Agenda packet, regular meeting — Palm Desert City Council, December 14, 2023 (part 2 of 5)

Investment Policy FIN-002
Effective January 1, 2024

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Reports of Condition and Income for A Bank with Domestic and Foreign Offices -- FFIEC 031.

The Treasurer’s Office will investigate all broker-dealer applicants in order to determine if they: (1) are adequately capitalized; (2) are subject to pending legal action (either the firm or the trader); (3) make markets in securities that are appropriate for the City’s needs; (4) are licensed as a broker by the State of California Department of Corporations; and (5) are a member of the Financial Industry Regulatory Authority. Broker-dealer applicants will be required to provide California state or local government references.

Any broker-dealer that has made a political contribution to any member of or candidate for the City Council, the RDA Successor Agency – Palm Desert Board, the Housing Authority Commission, or the Palm Desert Finance Committee in an amount that exceeds the limits in Municipal Securities Rulemaking Board (“MSRB”) Rule G-37, within any consecutive four-year period following January 1, 1996, will be ineligible to transact business with the City.

The City Council will consider the submitted documents, along with the treasury officers’ recommendations, and decide if any new broker-dealers should be added to the authorized list. If, in the City’s opinion, a broker-dealers RFI is missing, incomplete, or late (submitted after the specified deadline), contains false or misleading information, or if the broker has not submitted all of the documents that the City requires, then the City will automatically reject the broker-dealers RFI and that broker-dealer will not be eligible to submit another RFI to the City for three years.

The city treasurer may terminate a broker-dealer for trade fails, trade errors, excessive staff turnover, failure to provide notice of a significant event, inflated pricing, adverse change in financial condition, failure to comply with solicitation instructions, pending litigation against broker-dealer by City, violation of City’s gift ban policy, selling inappropriate investments, unethical behavior, collusion on pricing, tardiness in submitting offers, yield burning, lack of business due to a mismatch between city needs and broker-dealer inventory, or an insufficient volume of City business to justify broker-dealer retention.

The City Council must review and approve all commercial banks, savings associations, federal associations (as defined by Cal. Fin. Code, section 5102), and trust companies that are authorized as public depositories of City monies in the form of checking, savings, and money market accounts and certificates of deposit. The city shall have a signed agreement per Cal. Govt. Code, section 53649 with any depository accepting city deposits. Authorized financial institutions are listed in Appendix A of this policy.

The City will only deposit public monies in financial institutions that have:

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8.0.12 At least $50 billion in total assets. The only exception to the foregoing is that, under special circumstances, the City may procure limited services from a financial institution that has at least $5 billion in total assets. Such services may include those that a larger financial institution does not provide, are more expensive if a larger financial institution does provide them, or are offered by a smaller financial institution on more flexible terms that better suit the City’s needs. Under this exception, deposits made will not exceed one-tenth of one percent (0.1%) of the City investment portfolio.

8.0.13 A core capital-to-total assets ratio of at least five percent.

8.0.14 Favorable statistical ratings from a nationally recognized statistical rating organization (“NRSRO”), as determined by the city treasurer.

8.0.15 A federal or state charter.

8.0.16 A branch office within Riverside County.

8.0.17 A “satisfactory” overall rating in their most recent evaluation by the appropriate federal financial supervisory agency in terms of meeting the credit needs of California communities, pursuant to federal law.

The City cannot deposit funds into a financial institution if the sum of the City’s deposits would exceed the total shareholders’ equity of the institution.

9.0 Authorized Investments
The City Council has authorized the Treasurer’s Office to invest in the following financial instruments under the terms and conditions stated below (Cal. Govt.

Code, section 53600, et seq.). Percentage holding limits listed in this Policy apply at the time the security is purchased.

No. Type of Investment
% of Portfolio
Authorized Other Restrictions

1. United States Treasury bills,
notes, bonds, or certificates
of indebtedness, or those for
which the full faith and credit
of the United States are
pledged for the payment of
principal and interest.
100%

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No. Type of Investment
% of Portfolio
Authorized Other Restrictions

2. Federal Agency or United
States governmentsponsored enterprise (“GSE”)
obligations, participations, or
other instruments, including
those issued by or fully
guaranteed as to principal
and interest by federal
agencies or United States
government-sponsored
enterprises.
100%
No more than 30% of the portfolio
may be invested in any single issuer
(excluding the proceeds of taxexempt bonds).

3. Municipal Debt Registered
state warrants or treasury
notes or bonds of this state,
including bonds payable
solely out of the revenues
from a revenue-producing
property owned, controlled,
or operated by the state or by
a department, board, agency,
or authority of the state.

Registered treasury notes or
bonds of any of the other 49
states in addition to
California, including bonds
payable solely out of the
revenues from a revenueproducing property owned,
controlled, or operated by a
state or by a department,
board, agency, or authority of
any of the other 49 states, in
addition to California.

Bonds, notes, warrants, or
other evidences of
indebtedness of a local
agency within this state,
including bonds payable
30% Maximum maturity: 5 Years
Rated in a rating category of “A”
(long-term) or “A-1” (short-term) or
their equivalents or higher by an
NRSRO.

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No. Type of Investment
% of Portfolio
Authorized Other Restrictions
solely out of the revenues
from a revenue-producing
property owned, controlled,
or operated by the local
agency, or by a department,
board, agency, or authority of
the local agency.

4. Commercial Paper (“CP”)
(Non-Pooled Fund) that
general corporations
organized and operating in
the United States with assets
exceeding $500 million issue.
40% Maximum maturity: 270 days
Rated “A-1” by S&P or “P-1” by
Moody’s.

Asset-backed CP is ineligible for
purchase.

5. Negotiable Certificates of
Deposit (“NCD”) issued by a
nationally- or state-chartered
bank, a savings association,
a federal association, or a
federally licensed or
state-licensed branch of a
foreign bank.
30%
Maximum maturity: 5 years
Rated in a rating category of “A”
(long-term) or “A-1” (short-term) or
their equivalents or higher by an
NRSRO
.

6. Time Certificates of
Deposit (“TCD”) that
qualified public depositories
issue.
5%
Maximum maturity: 1 year
TCDs must be collateralized. The
city treasurer may waive the
collateralization requirements for any
portion that is covered by federal
deposit insurance.

TCDs must be centralized at one
location for each bank or S&L.

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No. Type of Investment
% of Portfolio
Authorized Other Restrictions
Issuing public depository must meet
qualifying criteria on Pages 5 and 6
of this policy.

7. Placement Service
Deposits Bank deposits
placed with a private sector
entity that assists in the
placement of deposits with
eligible financial institutions
located in the United States.
10% Maximum maturity: 1 year
The full amount of the principal and
the interest that may be accrued
during the maximum term of each
deposit shall at all times be insured
by federal deposit insurance.

8. Repurchase Agreement
(“RP”) that authorized
brokers sell.
10% Maximum maturity: 30 days
Collateral must be United States
Treasury, Federal, Agency, or GSE
obligations.

Zero coupon and stripped coupon
instruments are not acceptable as
collateral.

Collateral must be valued at
102% of cost and adjusted weekly.

City must have first lien and security
interest in all collateral.

City’s custodian must hold collateral.

An authorized broker must file a
Securities Industry and Financial
Markets Association (“SIFMA”)
Master Repurchase Agreement with
the city treasurer, and the city
attorney must review the agreement,
prior to the transaction of RP
business with that broker.

9. Medium-Term Notes
(“MTNs”) that corporations
30% Maximum maturity: 5 years

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No. Type of Investment
% of Portfolio
Authorized Other Restrictions
organized and operating in
the United States, or
depository institutions
operating in the United
States and licensed by the
United States or by any state
and operating within the
United States
.

Rated in a rating category of “A” or
higher by an NRSRO.

10. Money Market Mutual
Funds (“MMF”) that are
registered with the SEC
under the Investment Act of
1940.
20%
(excluding bond
proceeds)
Purchases are restricted to
Government Money Market Funds.

Either rated “AAA” or its equivalent
by an NRSRO or retains an
investment advisor registered or
exempt from registration with SEC,
with at
least 5 years of experience
managing a MMF with $500 million
or more in assets.

No commission may be charged.

11. State of California Local
Agency Investment Fund
(“LAIF”) that the State
Treasurer’s Office manages.

Up to maximum
(currently
$75,000,000
per account)
City Council and Redevelopment
Agency approved participation in
LAIF on 12/12/81 in Resolution No.
81-161.
(Bond trustee accounts have no
deposit limit)

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No. Type of Investment
% of Portfolio
Authorized Other Restrictions

12. Riverside County
Treasurer’s Pooled
Investment Fund (TPIF) The
TPIC was established by the
County Board of Supervisors.
75%
(excluding bond
proceeds)
As provided under the Cal. Govt.

Code section 53684.

13. Local Government
Investment Pools, Shares
of beneficial interest issued
by a local Government
investment pool joint
powers authority.
75%
(excluding bond
proceeds)
As required by law under the Cal.

Govt. Code section 53601(p).

10.0 Diversification
The City shall diversify the investments within the portfolio to avoid incurring unreasonable risks inherent in over investing in specific instruments, individual financial institutions or maturities. To promote diversification, no more than 5% of the portfolio may be invested in the securities of any one issuer, regardless of security type; excluding U.S. Treasuries, federal agencies, and pooled investments such as LAIF, money market funds, or local government investment pools.

11.0 Maximum Maturities
The city treasurer and/or their designee(s) shall maintain a system to monitor and forecast revenues and expenditures so that City funds can be invested to the fullest extent possible while providing sufficient liquidity to meet City’s reasonably anticipated cash flow requirements. Maturities of investments will be selected to provide necessary liquidity, manage interest rate risk, and optimize earnings.

Because of inherent difficulties in accurately forecasting cash flow requirements, a portion of the portfolio should be continuously invested in readily available funds.

For those investment types for which this Policy does not specify a maturity limit, no individual investment shall exceed a maturity of five years from the date of purchase unless the City Council has granted express authority to make that investment either specifically or as a part of an investment program approved by the City Council no less than three months prior to the investment.

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This Policy authorizes investing bond project and reserve funds beyond five years if the maturities of such investments do not exceed the expected use of the funds, the investments are deemed prudent in the opinion of the city treasurer, and the investments are not prohibited by the applicable bond documents.

12.0 Prohibited Investments and Strategies
The purchase of inverse floaters, range notes, mortgage-derived, interest-only strips, and securities that result in zero-interest accrual if held to maturity are prohibited (Cal. Govt. Code, section 53601.6). The purchase of asset-backed securities, bond mutual funds, non-federal agency mortgage-backed securities, reverse-repurchase agreements, and derivative contracts (forwards, futures, options, and swaps) are also prohibited.

Securities lending, short selling, and other hedging strategies are also prohibited.

Local government investment pools and money market mutual funds will be exempt from the prohibitions on derivative contracts, derivative securities, reverse repurchase agreements, securities lending, short selling, and other hedging strategies.

13.0 Investment Pools/Money Market Funds
The Treasurer’s Office must conduct a thorough investigation of an investment pool or money market fund prior to purchasing its shares. The Treasurer’s Office will develop a questionnaire that addresses the following issues with respect to the pool or fund:

13.0.1 A description of eligible investment securities and a written statement of investment policy and objectives.

13.0.2 A description of interest calculations, how interest is distributed, and how gains and losses are treated.

13.0.3 A description of how the securities are safeguarded (including the settlement process), how often they are priced, and how often the pool or fund is audited.

13.0.4 A description of who may invest in the pool or fund, how often, and the size of deposits and withdrawals that are allowed.

13.0.5 A schedule for receiving statements and portfolio listings.

13.0.6 Verification of whether the pool or fund uses reserves or retained earnings.

13.0.7 A fee schedule and when and how it is assessed.

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13.0.8 The eligibility of the pool or fund for bond proceeds, and whether the pool or fund will accept them.

14.0 Portfolio Management Strategy
The Treasurer’s Office will invest public funds using a passive strategy of buying and holding fixed-income securities. Whenever possible, a bond ladder will be constructed with laddered maturities that match anticipated cash flow dates. Securities may be sold prior to maturity only to: 1) address an actual or potential deterioration in credit quality; 2) rebalance the portfolio; or 3) meet unanticipated financial obligations.

The Treasurer’s Office, however, may actively manage the City’s holdings in local government investment pools that seek to maintain a constant net asset value of $1.00 per share, in order to maximize income, so long as there is no risk of principal loss.

If the City has contracted with an investment advisor to provide investment services, the investment advisor may invest those city funds under their management using an active management approach.

15.0 Portfolio Rebalancing
If portfolio percentage constraints are violated, then treasury officers should evaluate whether to hold or sell the affected securities. No additional securities of that investment type may be purchased until compliance with policy limits is restored.

Portfolio percentage limits are in place in order to ensure diversification of the City investment portfolio. A small, temporary imbalance will not significantly impair that strategy.

16.0 Credit Downgrading
This policy sets forth minimum credit-risk criteria for each security. This criteria applies to the initial purchase of a security. It does not automatically force the sale of a security if the security’s credit-risk ratings fall below policy limits.

If a security is downgraded below the minimum credit-risk criteria specified in this policy, then treasury officers should evaluate the downgrade on a case-by-case basis in order to determine whether the security should be held or sold.

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The city treasurer will inform the city manager and the Finance Committee at its next meeting of the credit downgrade and the treasury officers’ decision to hold or sell the downgraded security.

Treasury officers should review the credit standing of all securities in the City’s investment portfolios annually, at a minimum.

17.0Safekeeping and Custody
All securities transactions will be done on a delivery-versus-payment (“DVP”) or a receipt-versus-payment (“RVP”) basis. A third-party bank trust department (“Custodian”) that acts as an agent for the City, under the terms of a custody agreement executed between both parties, will hold the securities. The custodial bank must be one of the 20 largest commercial banks in the world, as measured by total assets. The City’s Custodian is listed in Appendix A of this policy.

The only exception to the foregoing will be securities purchases made with:

17.0.1 LAIF, TPIF, and local government investment pools.

17.0.2 Money market mutual funds.

17.0.3 Time Certificates of Deposit and Placement Service Deposits.

17.0.4 Federal Reserve Banks (“Treasury Direct Program”) since the purchased securities are not deliverable.

No securities broker should have access to City monies, accounts, or investments. The city treasurer’s prior approval, in writing, is required for any transfer of monies to or through a securities broker. If the city treasurer is unavailable, then the assistant finance director must authorize the transfer, in writing.

Broker trade confirmations are required for all trades. These confirmations must be reviewed immediately upon receipt, for conformity with the terms of the City’s trade sheets.

18.0 Collateralization
All demand deposits and time deposits must be fully collateralized in accordance with Cal. Govt. Code, section 53630 et seq. The city treasurer may waive the collateralization requirements for any portion that is covered by federal deposit insurance.

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19.0 Bond Proceeds
The city treasurer must segregate the gross proceeds of tax-exempt bonds from the City general pool and keep them in a separate pool. They must be invested in accordance with the instructions in their respective bond indentures of trust.

The City’s bond trustee (“Trustee”) will hold all tax-exempt securities in third-party safekeeping. DVP and RVP rules will apply. The City’s Trustee is listed in Appendix A of this policy.

Under the Tax Reform Act of 1986, the City is required to perform annual arbitrage calculations and to rebate excess earnings from the investment of the gross proceeds of tax-exempt bonds that were sold after the effective date of this law, to the United States Treasury. The city treasurer may contract with qualified outside financial consultants to provide the necessary technical expertise that is required in order to comply with this law.

20.0 Internal Controls
The city treasurer should ensure that all investment transactions comply with City policy. The Treasurer’s Office should establish internal controls that are designed to prevent losses due to fraud, negligence, and third-party misrepresentation.

Internal controls deemed most important would include avoidance of collusion, separation of duties and administrative controls, separating transaction authority from accounting and recordkeeping, custodial safekeeping, clear delegation of authority, management approval and review of investment transactions, specific limitations regarding securities losses and remedial action, written confirmation of telephone transactions, documentation of investment transactions and strategies, and monitoring of results.

The city treasurer must also establish a process of independent review by an audit firm of the City’s investment program every three years. The audit firm must review the program’s management in terms of compliance with the internal controls that City policy specifies.

A Finance Committee consisting of City officials and community representatives will be responsible for reviewing the City investment reports, transactions, policies and procedures, and strategies on at least a quarterly basis. The City Council will establish bylaws for the Finance Committee.

21.0 Reporting
The city treasurer must provide the City Council with a monthly investment report within 45 days after Finance Committee review of that report.

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In accordance with the provisions of Governmental Accounting Standards Board (“GASB”) Statement Number 40, as amended March 2003, the monthly investment report must:

21.0.1 Organize individual securities, such as U.S. Treasuries, corporate bonds, and commercial paper, by investment type. Dissimilar investments, such as U.S. Treasury bills and Treasury strips, should not be aggregated.

21.0.2 List the credit-risk ratings of at least two NRSROs for each security, mutual fund, or investment pool. If the security, mutual fund, or investment pool has no rating, then it should be shown as “unrated”.

21.0.3 Disclose the amount of individual securities and corresponding issuers that exceed five percent of net plan assets, except for securities that the U.S. Government guarantees, money market mutual funds, and external investment pools.

21.0.4 Use the specific identification method to reflect interest-rate risk by investment type and amount.

The monthly investment report must include a complete portfolio inventory with details on issue, par value, book value, coupon/rate, original settlement date of purchase, final maturity date, CUSIP number, average-weighted yield, average days-to-maturity, market value (including source of market valuation), and a list of investment transactions. The report must also include a statement on compliance or noncompliance with the City investment policy, and a statement on whether there are sufficient funds to meet the City’s anticipated cash requirements for the next six months.

22.0 Investment Policy Adoption
This policy will be updated, as needed, and will remain in effect until a new policy is adopted, at least once every five years. Any proposed revisions to the policy must first be submitted to the Finance Committee for review and then to the City Council for review and adoption.

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Appendix A: List of Authorized Financial Institutions
The Treasurer’s Office is authorized to transact investment and depository business with the following financial institutions.

UNITED STATES GOVERNMENT

1. Federal Reserve Bank

PRIMARY DEALERS

1. J.P. Morgan Securities LLC

2. Wells Fargo Securities LLC

SECONDARY BROKERS

1. Piper Sandler & Company

2. Stifel, Nicolaus & Company
PUBLIC DEPOSITORIES*

1. Citibank, N.A.

2. JP Morgan Chase & Co.

3. MUFG Union Bank, N.A.

CUSTODIAN

1. Union Bank Global Custody Services

TRUSTEE

1. U.S. Bank Global Corporate Trust Services
*Exceptions are limited to those financial institutions defined in section 8.0.12

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CITY OF PALM DESERT

ADMINISTRATIVE PROCEDURES
Subject Investment Policy
Policy No. FIN - 002
Date Issued: April 11, 2019
Revised: November 19, 2020
Approved by
Resolution Nos. 2020-79, SARDA-080, FA-70,
HA-99.
(prev. 2019-15, SARDA 076, HA-91, FA-69)
Authored by Finance Department

1.0 Policy
The policy of the City of Palm Desert, the Successor Agency to the Palm Desert Redevelopment Agency, the Palm Desert Housing Authority, the Palm Desert Financing Authority, and the Palm Desert Recreational Facilities Corporation (hereafter referred to collectively as the “City”) is to invest public funds with the goals of preserving capital, meeting the City’s daily cash needs, and achieving a market rate of return, while complying with all federal, state, and local laws.

2.0 Scope
This investment policy will apply to all funds over which the Treasurer’s Office has fiduciary responsibility and direct management control.

3.0 Prudence
The Treasurer’s Office follows the “Prudent Investor Standard”, which requires treasury officers to manage the City investment portfolio with the care, skill, prudence, and diligence that a prudent investor who is similarly situated would use, based upon general economic conditions and the City’s anticipated needs, in order to safeguard principal and to maintain liquidity (Cal. Govt. Code, section 53600.3).

Treasury officers, who follow the provisions of this policy and who exercise due diligence, will be relieved of personal responsibility for a security’s credit risk or market price risk if they report substantial deviations from expectations to the city manager and to the Finance Committee in a timely manner, and if they take appropriate action to control adverse developments.

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“Substantial deviations” is defined as either a decline of 10 percent or more in the market value of a security due to issuer default, a credit risk downgrade, or the sale of a security prior to maturity at 10 percent or more below its acquisition cost.

4.0 Objectives
The City’s investment objectives, in order of priority, are:

4.0.1 Safety
Safety of principal is foremost. Investments should be made with the aim of avoiding capital losses due to credit risk and to market price risk. Credit risk can be mitigated by investing in high-quality securities, diversifying investments, and pre-qualifying securities brokers and public depositories. Market price risk can be mitigated by matching debt maturities with anticipated cash requirements so that a premature sale of securities will not be necessary. It is recognized, however, that in a diversified portfolio, occasional measured losses are inevitable and must be considered within the context of overall investment return.

4.0.2 Liquidity
The City investment portfolio should be kept sufficiently liquid so that all operating requirements, which might be reasonably anticipated, can be met. The portfolio should consist largely of relatively low-duration securities with active secondary markets. An amount equal to the City’s annual budget must be held in cash or invested in laddered securities that mature in less than one year.

4.0.3 Yield
Yield should be considered only after the basic requirements of safety and liquidity have been met. The City investment portfolio should be structured to achieve a market rate of return, without compromising safety and liquidity. The average monthly yield of the State of California Local Agency Investment Pool (“LAIF”) will represent the market rate of return and will serve as the portfolio performance benchmark.

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5.0 Delegation of Authority
The Palm Desert City Council is authorized to invest, to deposit, and to provide for the safekeeping of the City’s funds, or to delegate those responsibilities to a city treasurer (Cal. Govt. Code, sections 53607 and 53608). The City Council has delegated those responsibilities to the city treasurer (Palm Desert, California, Municipal Code, section 3.08.010). The director of finance serves ex officio as city treasurer (Palm Desert, California, Municipal Code, section 2.16.010). The city treasurer, or their designee, has exclusive authority to buy and sell securities on the City’s behalf. The city treasurer must authorize all investment transactions, in writing, prior to initiation. If the city treasurer is unavailable, then the assistant finance director must perform that task.

6.0 Investment Procedures
The city treasurer will develop written procedures for the City’s investment program that are consistent with the provisions of this policy. These procedures will include safekeeping, repurchase agreements, banking service contracts, and collateral/depository agreements. They will also address the explicit delegation of authority to individuals who are responsible for investment transactions. No person may engage in an investment transaction except as provided for under the terms of this policy and under the procedures that the city treasurer establishes.

7.0 Conflicts of Interest
Treasury officers must refrain from personal business activity that could conflict with the proper execution of the City’s investment program, or impair their ability to make impartial investment decisions. They must disclose to the City Council any material financial interest in financial institutions that do business in the City of Palm Desert.

8.0 Authorized Broker-Dealers and Financial Institutions The City Council will review and approve the securities broker-dealers that are authorized to do business with the City. Authorized broker-dealers are listed in Appendix A of this policy.

Only primary government securities dealers (“primary dealers”) that regularly report to the Federal Reserve Bank of New York will be eligible for inclusion on the City’s authorized list.

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The only exception to the foregoing will be that the City Council may, at its discretion, accept, review, and approve Requests for Information (“RFI”) from secondary securities brokers that: (1) have been in existence for more than five years; (2) have a net capital position in excess of $100 million; (3) are licensed as brokers by the State of California; and (4) are headquartered or have a branch office in California.

The total number of authorized broker-dealers must not exceed four. The City will accept and review new broker-dealer applications only when there is an immediate need to fill a vacancy on the authorized list. The Treasurer’s Office will only accept RFIs from and transact business with the institutional securities sales departments of broker-dealers. The Treasurer’s Office must not transact business with an authorized brokerdealer until all of the documentation that both parties require has been executed and delivered.

All broker-dealers who wish to apply for inclusion on the authorized list must, at a minimum, provide the Treasurer’s Office with a copy of the following documents unless otherwise noted:

8.0.1 Completed “Broker-Dealer Request for Information” (signed original only).

8.0.2 The firm’s most recent Annual Report and Securities and Exchange Commission (“SEC”) Form 10-K or 20-F.

8.0.3 The firm’s National Association of Securities Dealers (“NASD”) Form BD -- Uniform Application for Broker-Dealer Registration or, in the case of an investment department within a commercial bank, SEC Form MSD.

8.0.4 The firm’s current NASD Form BD Status Report.

8.0.5 NASD Form U-4 -- Uniform Application for Securities Industry Registration or Transfer for each employee would who might be trading with the City.

8.0.6 Current NASD Form U-4 Status Report on each employee who might be trading with the City.

8.0.7 A resume from each of the firm’s employees who might be trading with the City.

8.0.8 The firm’s delivery and wiring instructions.

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8.0.9 An executed corporate resolution that identifies employees who are authorized to trade with the City.

8.0.10 The firm’s current investment policy.

In addition to the above documents, secondary brokers must also submit:

8.0.11 The firm’s most recent SEC Form X-17 A-5 or, in the case of an investment department within a commercial bank, SEC
Consolidated Reports of Condition and Income for A Bank with Domestic and Foreign Offices -- FFIEC 031.

The Treasurer’s Office will investigate all broker-dealer applicants in order to determine if they: (1) are adequately capitalized; (2) are subject to pending legal action (either the firm or the trader); (3) make markets in securities that are appropriate for the City’s needs; (4) are licensed as a broker by the State of California Department of Corporations; and (5) are a member of the National Association of Securities Dealers. Broker-dealer applicants will be required to provide California state or local government references.

The City Council will consider the submitted documents, along with the treasury officers’ recommendations, and decide if any new broker-dealers should be added to the authorized list. If, in the City’s opinion, a brokerdealers RFI is missing, incomplete, or late (submitted after the specified deadline), contains false or misleading information, or if the broker has not submitted all of the documents that the City requires, then the City will automatically reject the broker-dealers RFI and that broker-dealer will not be eligible to submit another RFI to the City for three years.

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unethical behavior, collusion on pricing, tardiness in submitting offers, yield burning, lack of business due to a mismatch between city needs and brokerdealer inventory, or an insufficient volume of City business to justify brokerdealer retention.

The City Council must review and approve all commercial banks, savings associations, federal associations (as defined by Cal. Fin. Code, section 5102), and trust companies that are authorized as public depositories of City monies in the form of checking, savings, and money market accounts and certificates of deposit. Authorized financial institutions are listed in Appendix A of this policy.

The City will only deposit public monies in financial institutions that have:

8.0.13 A core capital-to-total assets ratio of at least five percent.

8.0.14 Favorable statistical ratings from a nationally recognized statistical rating organization (“NRSRO”), as determined by the city treasurer.

8.0.15 A federal or state charter.

8.0.16 A branch office within Riverside County.

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The City cannot deposit funds into a financial institution if the sum of the City’s deposits would exceed the total shareholders’ equity of the institution.

9.0 Authorized Investments
The City Council has authorized the Treasurer’s Office to invest in the following financial instruments under the terms and conditions stated below (Cal. Govt. Code, section 53600, et seq.). All non-pooled securities must mature within five years unless the City Council has approved longer maturities for the investment of bond reserve, bond escrow, and other funds.

No. Type of Investment
% of Portfolio
Authorized Other Restrictions

1. United States Treasury
bills,
notes, bonds, or certificates
of indebtedness, or those
for
which the full faith and
credit of the United States
are pledged for the
payment of principal and
interest.
100% Maximum maturity: 5 Years

2. Federal Agency or United
States governmentsponsored enterprise
(“GSE”) obligations,
participations, or other
instruments, including
those that Federal Agencies
or GSEs have either issued
or fully guaranteed as to
principal and interest.
100% Maximum maturity: 5 years
No more than 30% of the portfolio
may be invested in any single
issuer (excluding the proceeds of
tax-exempt bonds).

3. California State and Local 25% Maximum maturity: 5 Years

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No. Type of Investment
% of Portfolio
Authorized Other Restrictions
Agency debt obligations
that a state or local agency,
or a department, board,
agency, or authority of a
state or local agency has
issued as general
obligation bonds or
revenue bonds.

Rated “A” or higher by S&P or by
Moody’s.

4. Commercial Paper (“CP”)
(Non-Pooled Fund) that
general corporations
organized and operating in
the United States with
assets exceeding $500
million issue.
25% Maximum maturity: 270 days
Rated “A-1” by S&P or “P-1” by
Moody’s.

No more than 10% of the portfolio
may be invested in the CP and
MTNs of any single issuer.

Asset-backed CP is ineligible for
purchase.

5. Negotiable Certificates of
Deposit (“NCD”) that a
nationally- or statechartered
bank, a savings
association, a federal
association, or a
state-licensed branch of a
foreign bank issue.
5%
Maximum maturity: 5 years
Long-term debt rated “AA-“
higher by S&P or by Moody’s.

6. Time Certificates of
Deposit (“TCD”) that
qualified public
depositories issue.
5%
Maximum maturity: 1 year
TCDs exceeding the FDIC limit
must be collateralized.

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No. Type of Investment
% of Portfolio
Authorized Other Restrictions
TCDs must be centralized at one
location for each bank or S&L.

If TCD is uncollateralized, then no
more than 90 percent of the FDIC
limit may be invested per TCD.

Issuing public depository must
meet qualifying criteria on Pages 5
and 6 of this policy.

7. Repurchase Agreement
(“RP”) that authorized
brokers sell.
10% Maximum maturity: 30 days
Collateral must be United States
Treasury, Federal, Agency, or GSE
obligations.

Zero coupon and stripped coupon
instruments are not acceptable as
collateral.

Collateral must be valued at
102% of cost and adjusted weekly.

City must have first lien and
security interest in all collateral.

City’s custodian must hold
collateral.

An authorized broker must file a
Public Securities Association
(“PSA”) Master Repurchase
Agreement with the city treasurer,
and the city attorney must review
the agreement, prior to the
transaction of RP business with
that broker.

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No. Type of Investment
% of Portfolio
Authorized Other Restrictions

8. Medium-Term Notes
(“MTNs”) that corporations
organized and operating in
the United States, or
depository institutions
operating in the United
States and licensed by the
United States or by any
state,
issue.
25% Maximum maturity: 5 years
Rated “A” or higher by S&P or by
Moody’s.

No more than 10% of the portfolio
may be invested in the CP and
MTNs of any single issuer.

9. Money Market Mutual
Funds (“MMF”) that are
registered with the SEC
under the Investment Act
of 1940.
20%
(excluding bond
proceeds)

Either rated “AAA” by S&P, “Aaa”
by Moody’s, or “AAA-V-1+” by
Fitch (2 of 3), or retains an
investment advisor registered or
exempt from registration with
SEC, with at
least 5 years of experience
managing a MMF with $500
million or more in assets.

MMF must have dollar-weighted
average maturity of 90 days or
less.

MMF must buy securities that
mature in 13 months or less.

No commission may be charged.

10. State of California Local
Agency Investment Fund
(“LAIF”) that the State
Treasurer’s Office
manages.

Up to maximum
(currently
$75,000,000
per account)

City Council and Redevelopment
Agency approved participation in
LAIF on 12/12/81 in Resolution No.
81-161.
(Bond trustee accounts have no
deposit limit)

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No. Type of Investment
% of Portfolio
Authorized Other Restrictions

11. Structured Notes in the
form of callable securities
or “STRIPS” that the
United States Treasury,
Federal Agencies, or
governmentsponsored enterprises
(“GSEs”) issue.
20% Maximum maturity: 5 years

12. Local Government
Investment Pools, such as
LAIF, CAMP, or California
county investment pools.
75%
(excluding bond
proceeds)
As required by law under the Cal.

Govt. Code.

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10.0 Prohibited Investments and Strategies
The purchase of inverse floaters, range notes, mortgage-derived, interestonly strips, and securities that result in zero-interest accrual if held to maturity are prohibited (Cal. Govt. Code, section 53601.6). The purchase of asset-backed securities, bond mutual funds, mortgage-backed securities, reverse-repurchase agreements, and derivative contracts (forwards, futures, options, and swaps) are also prohibited.

Active investment strategies, such as market timing, sector rotation, or benchmark indexing are prohibited. Securities lending, short selling, and other hedging strategies are also prohibited.

11.0 Investment Pools/Mutual Funds
The Treasurer’s Office must conduct a thorough investigation of an investment pool or mutual fund prior to purchasing its shares. The Treasurer’s Office will develop a questionnaire that addresses the following issues with respect to the pool or fund:

11.0.1 A description of eligible investment securities and a written statement of investment policy and objectives.

11.0.2 A description of interest calculations, how interest is distributed, and how gains and losses are treated.

11.0.3 A description of how the securities are safeguarded (including the settlement process), how often they are priced, and how often the pool or fund is audited.

11.0.4 A description of who may invest in the pool or fund, how often, and the size of deposits and withdrawals that are allowed.

11.0.5 A schedule for receiving statements and portfolio listings.

11.0.6 Verification of whether the pool or fund uses reserves or retained earnings.

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11.0.7 A fee schedule and when and how it is assessed.

11.0.8 The eligibility of the pool or fund for bond proceeds, and whether the pool or fund will accept them.

12.0 Portfolio Management Strategy
The Treasurer’s Office will invest public funds using a passive strategy of buying and holding fixed-income securities. Whenever possible, a bond ladder will be constructed with laddered maturities that match anticipated cash flow dates. Securities may be sold prior to maturity only to: 1) address an actual or potential deterioration in credit quality; 2) rebalance the portfolio; or 3) meet unanticipated financial obligations.

13.0 Portfolio Rebalancing
If portfolio percentage constraints are violated due to a temporary imbalance in the portfolio, then treasury officers should hold the affected securities to maturity in order to avoid capital losses.

If no capital losses would be realized upon sale, however, then treasury officers should consider rebalancing the portfolio after evaluating the expected length of time that it will be imbalanced.

Portfolio percentage limits are in place in order to ensure diversification of the City investment portfolio. A small, temporary imbalance will not significantly impair that strategy.

14.0 Credit Downgrading
This policy sets forth minimum credit-risk criteria for each security. This criteria applies to the initial purchase of a security. It does not automatically force the sale of a security if the security’s credit-risk ratings fall below policy limits.

If a security is downgraded below the minimum credit-risk criteria specified in this policy, then treasury officers should evaluate the downgrade on a

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case-by-case basis in order to determine whether the security should be held or sold.

The city treasurer will inform the city manager and the Finance Committee at its next meeting of the credit downgrade and the treasury officers’ decision to hold or sell the downgraded security.

Treasury officers should review the credit standing of all securities in the City’s investment portfolios annually, at a minimum.

15.0 Safekeeping and Custody
All securities transactions will be done on a delivery-versus-payment (“DVP”) or a receipt-versus-payment (“RVP”) basis. A third-party bank trust department (“Custodian”) that acts as an agent for the City, under the terms of a custody agreement executed between both parties, will hold the securities. The custodial bank must be one of the 20 largest commercial banks in the world, as measured by total assets. The City’s Custodian is listed in Appendix A of this policy.

The only exception to the foregoing will be securities purchases made with:

15.0.1 Local government investment pools.

15.0.2 Money market mutual funds.

15.0.3 Federal Reserve Banks (“Treasury Direct Program”) since the purchased securities are not deliverable.

No securities broker or investment advisor should have access to City monies, accounts, or investments. The city treasurer’s prior approval, in writing, is required for any transfer of monies to or through a securities broker. If the city treasurer is unavailable, then the assistant finance director must authorize the transfer, in writing.

Broker trade confirmations are required for all trades. These confirmations must be reviewed immediately upon receipt, for conformity with the terms of the City’s trade sheets.

16.0 Collateralization

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All demand deposits and time deposits that are not insured by the Federal Deposit Insurance Corporation (“FDIC”), the Federal Savings and Loan Insurance Corporation (“FSLIC”), or the National Credit Union Administration (“NCUA”) must fully collateralized in accordance with Cal.

Govt. Code, section 53652. An independent third party must hold the collateral.

Collateralized investments and demand deposits may require substitution of collateral. The city treasurer must approve all requests from financial institutions for substitution of collateral that involves interchanging classes of securities.

17.0 Bond Proceeds
The city treasurer must segregate the gross proceeds of tax-exempt bonds from the City general pool and keep them in a separate pool. They must be invested in accordance with the instructions in their respective bond indentures of trust. The city’s bond trustee (“Trustee”) will hold all taxexempt securities in third-party safekeeping. DVP and RVP rules will apply.

The City’s Trustee is listed in Appendix A of this policy.

18.0 Internal Controls
The city treasurer should ensure that all investment transactions comply with City policy. The Treasurer’s Office should establish internal controls that are designed to prevent losses due to fraud, negligence, and third-party misrepresentation.

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documentation of investment transactions and strategies, and monitoring of results.

19.0 Reporting
The city treasurer must provide the City Council with a monthly investment report within 30 days after Finance Committee review of that report.

In accordance with the provisions of Governmental Accounting Standards Board (“GASB”) Statement Number 40, as amended March 2003, the monthly investment report must:

19.0.1 Organize individual securities, such as U.S. Treasuries, corporate bonds, and commercial paper, by investment type. Dissimilar investments, such as U.S. Treasury bills and Treasury strips, should not be aggregated.

19.0.2 List the credit-risk ratings of at least two NRSROs for each security, mutual fund, or investment pool. If the security, mutual fund, or investment pool has no rating, then it should be shown as “unrated”.

19.0.3 Disclose the amount of individual securities and corresponding issuers that exceed five percent of net plan assets, except for securities that the U.S. Government guarantees, money market mutual funds, and external investment pools.

19.0.4 Use the specific identification method to reflect interest-rate risk by investment type and amount.

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The monthly investment report must include a complete portfolio inventory with details on issue, par value, book value, coupon/rate, original settlement date of purchase, final maturity date, CUSIP number, averageweighted yield, average days-to-maturity, and market value (including source of market valuation). The report must also include a statement on compliance or noncompliance with the City investment policy, and a statement on whether there are sufficient funds to meet the City’s anticipated cash requirements for the next six months.

20.0 Investment Policy Adoption
This policy will be updated, as needed, and will remain in effect until a new policy is adopted, at least once every five years. Any proposed revisions to the policy must first be submitted to the Finance Committee for review and then to the City Council for review and adoption.

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Appendix A: List of Authorized Financial Institutions
The Treasurer’s Office is authorized to transact investment and depository business with the following financial institutions.

UNITED STATES GOVERNMENT

1. Federal Reserve Bank

PRIMARY DEALERS

1. J.P. Morgan Securities LLC

2. Wells Fargo Securities LLC

SECONDARY BROKERS

1. Piper Sandler & Company

2. Stifel, Nicolaus & Company
PUBLIC DEPOSITORIES*

1. Citibank, N.A.

2. JP Morgan Chase & Co.

3. MUFG Union Bank, N.A.

CUSTODIAN

1. Union Bank Global Custody Services

TRUSTEE

1. U.S. Bank Global Corporate Trust Services
*Exceptions are limited to those financial institutions defined in section 8.0.12.

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CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: December 14, 2023
PREPARED BY: Erica Powell, Management Analyst
REQUEST: RECOMMEND DEACCESSION OF RECREATION LIBERATES BY JOS

GOMOLKA
RECOMMENDATION:

Authorize deaccession of Recreation Liberates by Jos Gomolka.

BACKGROUND/ANALYSIS:

In May 1993, Palm Desert’s Civic Arts Committee recommended approval of Recreation Liberates by Jos Gomolka, for installation at the Palm Desert Community Center, which was subsequently approved by the City Council. The glass sculpture, which was dedicated along with the building on September 19, 1993, was created specifically for the lobby at a total cost of $12,000.

The Palm Desert Community Center has planned renovations scheduled to begin in January 2024 and the new design does not incorporate the sculpture due to its large size and outdated design.

In accordance with the Public Art Deaccession Policy adopted by the City Council on July 13, 2023, given the age of the installation and size and sight specific nature of the artwork, staff recommends that Recreation Liberates by Jos Gomolka be permanently deaccessioned from the City’s permanent collection based on the following criteria:

1. The sculpture has been in place for more than fifteen (15) years.

2. The cost of relocating the artwork exceeds the value of the artwork.

3. Loss of Site - No alternative site for the artwork is available.

Given that the framed housing of the sculpture would need to be reconstructed once removed, the cost exceeds the value of the artwork and thereby it would not be cost effective to relocate or sell. As such, the only feasible deaccession method would be to properly dispose of the artwork.

Staff has followed the sequence of actions/procedures outlined in the City’s Public Art Deaccessioning Policy. After the artist and artist’s estate were unable to be reached, upon staff’s recommendation for deaccession, at its regular meeting of September 13, 2023, the Cultural Arts Committee requested that a press release be sent out to the community offering the sculpture as a donation, which was done on October 5, 2023. Subsequently, on October 12, 2023, staff received a call from the artist’s daughter, Silva deJong, who is requesting to take possession of two (2) of the smaller pieces of the sculpture - one end piece and one in the wall.

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City of Palm Desert
Deaccession of Recreation Liberates by Jos Gomolka

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Given that the artist’s estate is requesting to take possession of a portion of the artwork and there was no response to the City’s press release offering it as a donation, at its regular meeting of November 8, 2023, the Cultural Arts Committee unanimously recommended the deaccession of Recreation Liberates by Jos Gomolka. Upon final approval by City Council the two pieces will be returned to the artists’ estate and the remain portions will be disposed of.

Final approval of this item is timely as the Desert Recreation District intends to proceed with construction at the Palm Desert Community Center in early 2024.

Legal Review:

This report has been reviewed by the City Attorney’s office.

Appointed Body Recommendation:

At its meeting on November 8, 2023, the Cultural Arts Committee voted to approve the deaccession of Recreation Liberates by Jos Gomolka sculpture by a 6-0 vote with Adney, Boren, Flint, Hauer, Mitze and Simley voting AYE.

FINANCIAL IMPACT:

The cost of the artwork was $12,000 in May 1993. Staff has no record of current fair market value of this site-specific work. There is no cost to the General Fund related to deaccessioning the artwork.

ATTACHMENTS:

1. Deaccession Policy

2. Deaccessioning Worksheet

3. Current artwork photographs

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City of Palm Desert’s Public Art Deaccessioning Policy

DEFINITION
Deaccession means the formal process to permanently remove a City-owned public artwork by selling, donating, or destroying it.

POLICY
A. The purpose of the Public Art Deaccessioning Policy (“Policy”) is to maintain a deaccession program that results in high-quality, City-owned public artwork; eliminate artworks that are unsafe, not repairable, or no longer meet the needs of the City, and respect the creative rights of artists.

B. Although the City of Palm Desert would like each public artwork to remain in situ for a minimum of 15 years (although 15 years is not a limit on the life of an artwork), it recognizes that public artwork is not necessarily going to remain in place in perpetuity.

C. Any proposal for removal, destruction, or relocation of an artwork shall be submitted to the Cultural Arts Committee by City staff and reviewed according to the policies and procedures contained herein and shall be deliberate and independent of political pressures, fluctuations in artistic taste, popularity, and public opinion.

D. At regular intervals, the City’s public artwork collection shall be evaluated by the Cultural Arts Committee to determine the condition of each artwork and determine whether any artwork should be deaccessioned.

APPLICABLE ARTWORK
This Policy applies to all City-owned artwork acquired through the Public Art program or through donation. In the case of donated artwork, all legal documents surrounding the donation must be reviewed and a legal opinion rendered by the City Attorney before proceeding with the deaccessioning process.

CRITERIA FOR DEACCESSIONING
One or more of the following criteria must apply prior to an artwork being deaccessed:

1. Damage Beyond Repair - The artwork has been damaged and repair is unfeasible or repair costs would exceed the value of the artwork.

2. Safety - The artwork is deemed hazardous and a threat to public safety.

3. Deterioration - The artwork has deteriorated to the point that the restoration cost is greater than its monetary value or the artwork has deteriorated beyond the original design and restoration would prove impractical or would render the work essentially false.

4. Security - The condition or security of the artwork cannot be reasonably guaranteed or the City of Palm Desert cannot properly care for or store the artwork.

5. Site Alteration - In the case of site-specific artwork, the artwork has become inappropriate, is no longer accessible to the public, it is unsafe, or it is due to be destroyed and would severely alter its relationship to the site.

Item 1D-5

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6. Excessive Maintenance - The artwork requires excessive or unreasonable maintenance.

7. Loss of Site – The current site is no longer available and no suitable alternate site for the artwork is available.

8. Aesthetic Value - The artwork is of poor quality or is judged to have little aesthetic and/or historical or cultural value.

9. Failure to Comply - If the approved terms of the contract pursuant to which the artwork was installed have not been fulfilled.

10. Inauthentic - The artwork is a forgery or in violation of existing copyright laws.

11. Theft – The artwork has been stolen. Any stolen artwork will be documented through an official police report and a report prepared by the entity that owns or is responsible for the site of loss.

SEQUENCE OF ACTION / PROCEDURES

1. Deaccession requests may be submitted by a neighborhood organization, City department, independent City board or commission, or a City Council member.

The Cultural Arts Committee will review each preliminary request. City staff will work with the applicant to bring a full proposal to the Cultural Arts Committee.

2. Staff will provide the applicant with a Deaccessioning Form that will serve as the applicant’s formal request for consideration by the Cultural Arts Committee.

3. Staff (with assistance from the property owner, if applicable) will make reasonable effort to notify and consult with any living artist(s) whose work is being considered for deaccession as to the best procedure for artwork removal.

The City will allow the artist(s) 30 days to respond.

4. If the artist(s) is/are deceased, the City will make reasonable efforts to contact artist(s) estate.

5. After an attempt to contact the artist(s) is made, staff will consult with the City Attorney on how to proceed with the deaccessioning.

6. Once the request is reviewed by the City Attorney, the applicant will complete and return the Deaccessioning Form.

7. City staff will use the information from the Deaccessioning Form to complete a staff report addressing the proposed removal of the artwork. The staff report will provide all available relevant information and materials to the Cultural Arts Committee, including, but not limited to:
a. Artist, Title, and Location of artwork.
b. Name of property owner and contact information.
c. Property owner at the time of commission or installation. d. Year commissioned/purchased, original cost of artwork, and applicable Art in Public Places (AIPP) fee.
e. Dimensions and removal/re-installation instructions. f. Appraisal of the artwork provided by a qualified art appraiser and current condition of artwork. If appropriate, current fair market value of the artwork.
g. Detailed reason for deaccessioning/relocating artwork. h. Proposed deaccession method or new location for artwork (relocation, sale, donation, demolition, etc.).

Item 1D-6

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[Type here]
i. Maintenance evaluation.
j. Any relevant images.

8. The staff report will then be placed on the Cultural Arts Committee agenda at a regularly scheduled public meeting, where it will be reviewed and voted on.

9. If the Cultural Arts Committee approves the deaccession, City staff will bring the staff report before the City Council for review and final action.

10. If deaccession is approved by the City Council, all documents will be updated to reflect the deaccessioning of the artwork. Staff will review property records from the County Recorder’s Office and if an artwork covenant is recorded against the property, the City will cause a release covenant to be filed.

11. The deaccessioning process should be documented in both written and visual form.

12. If an artwork is sold, proceeds should be deposited into the Art in Public Places fund.

13. The City’s Risk Manager must be notified so that the work can be removed from the City’s insurance policy.

DEACCESSIONING METHOD OPTIONS

1. If appropriate, reasonable efforts will be made to move the work to a new location within the City. If the artwork was designed for a specific site, City will consider the artist’s intent when deciding where to relocate the artwork.

2. The artist(s) will be given the first option to purchase or exchange the artwork. If the artist(s) decides to purchase the work, they will be responsible for the cost of the removal of the artwork from the current site. If the artist(s) is/are deceased, the legal heir(s) will have first rights of purchase. The artist(s) can purchase the artwork at fair market value according to the appraisals obtained by a qualified appraiser.

3. Put the work in storage until a new, appropriate location can be found.

4. Donate work to a school, an educational or non-profit organization.

5. Dispose of work in an appropriate manner.

PROVISIONS FOR EMERGENCY REMOVAL
In the event that the structural integrity or condition of an artwork is such that, in the opinion of the Public Art staff, the artwork presents an imminent threat to public safety, the City Manager may authorize its immediate removal without Cultural Arts Committee action or the artist’s consent and have the work placed in temporary storage. The artist and the Cultural Arts Committee will be notified of this action within 30 days. The Committee will then consider options for disposition: repair, reinstallation, maintenance or deaccessioning. If the artwork cannot be removed without being altered, modified, or destroyed, and if the Artist’s Agreement with the City and County has not waived his/her rights under the California Art Preservation Act and the Visual Artists Rights Act, City staff will attempt to gain such written permission before proceeding. In the event that this cannot be accomplished before action is required in order to protect the public health and safety, the City Manager shall proceed with the advice of the City Attorney.

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COMPLIANCE WITH APPLICABLE POLICIES AND REGULATIONS
Deaccession and removal of artwork will be done in a manner that complies with all other applicable city, state, and federal procedures, policies and regulations. For example, deaccession and removal actions must comply with applicable procedures and laws relating to the disposition of city property and with laws protecting artists’ rights.

Item 1D-8

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City of Palm Desert Public Art Deaccessioning/Relocating Worksheet Artist: Gomolka, Jos
Title: Recreation Liberates
Location of work: Entry Lobby
Name of property: Desert Recreation District, Palm Desert Community Center Contact name: Troy Strange
Phone: 760-347-3484 Extension: FAX:

Property owner at the time of commission: Coachella Valley Recreation and Park District
Year commissioned/purchased: 1993 ______
Purchase Price / Art in Public Places fee / Value at time of install: $12,000______ Dimensions: 7 glass pieces

1. 3’ x 3’

2. 3’ x 4’

3. 3’ x 5’

4. 4’ x 6’

5. 3’ x 5’

6. 3’ x 4’

7. 3’ x 3’
Estimated current fair market value: unknown
Source of estimation: unknown
Proposed deaccession reviewed by City Attorney: Yes: No:

Detailed reason for deaccessioning artwork:

DRD is undergoing renovation work and will be demolishing lobby. Artwork is outdated.

The artwork was commissioned thirty (30) years ago for this site-specific location and now is not current or fitting for updated renovation work.

Proposed deaccessioning method: Two pieces will go to the artist’s daughter and the remaining pieces will be demolished with the rest of the lobby.

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City of Palm Desert Public Art Deaccessioning/Relocating Worksheet New location for work (if it is being moved): DNA
Condition: Excellent Good X Fair Poor
Maintenance evaluation and instructions:

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December 14,2023 – Staff Report
Deaccessioning of Recreation Liberates
Current artwork photographs

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CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: December 14, 2023
PREPARED BY: Deborah Glickman, Management Analyst
REQUEST: APPROVE CENTRAL INVENTORY OF SURPLUS LAND OWNED BY THE

CITY OF PALM DESERT AND SUCCESSOR AGENCY TO THE PALM

DESERT REDEVELOPMENT AGENCY AND DIRECT THE REPORTING

OF INFORMATION TO THE CALIFORNIA DEPARTMENT OF HOUSING

AND COMMUNITY DEVELOPMENT
RECOMMENDATION:

1. Approve the City of Palm Desert Central Inventory of surplus land and land in excess of foreseeable need in connection with properties owned by the City of Palm Desert and Successor Agency to the Palm Desert Redevelopment Agency (SARDA), as outlined in the staff report, pursuant to Government Code Section 54230(a)(1).

2. Authorize staff to report to the California State Department of Housing and Community Development (HCD) information about such properties pursuant to Government Code 54230(a)(2).

BACKGROUND/ANALYSIS:

The Surplus Land Act, as amended, (Government Code § 54220 et seq.) (the “Act”), requires pursuant to Government Code Section 54230(a)(1), that on or before December 31 of each year, each county and city in the state must “make a central inventory of all surplus land, as defined in Government Code Section 54221(b), and all lands in excess of its foreseeable needs, if any, identified pursuant to Government Code Section 50569, located in all urbanized areas and urban clusters within the jurisdiction of the county or city that the county or city or any of its departments, agencies, or authorities owns or controls” (the Central Inventory).

Government Code Section 54221(b) defines “surplus land” to mean land that is owned in fee simple by a local agency for which the local agency’s governing board takes formal action in a regular public meeting declaring that the land is surplus and not necessary for the agency’s use.

Land shall be declared either “surplus land” or “exempt surplus land,” as supported by written findings, before a local agency may take any action to dispose of it consistent with an agency’s policies or procedures. Surplus land must be made publicly available for purchase or lease through an HCD prescribed process, which includes distribution of a Notice of Availability (NOA) to a list of housing developers prepared and updated regularly by HCD and designated public entities. The disposition of exempt surplus land is not subject to the HCD prescribed process under the Act.

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City of Palm Desert
December 2023 – Central Inventory

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The Central Inventory does not provide for the disposition of any property, and staff will return to the City Council or Successor Agency, as appliable, at future meetings to address the disposition of individual properties as appropriate.

Pursuant to Government Code Section 54230(a)(2), each county and city shall make a description of each parcel described in Government Code Section 54230(a)(1) a matter of public record and shall report this information to HCD no later than April 1st of each year in a form prescribed by HCD (Table H), as part of its annual progress report submitted pursuant to Government Code Section 65400(a)(2). Each county and city shall provide the Central Inventory without charge, to those who request it.

According to the Act, the City of Palm Desert (City) Central Inventory shall provide a description of each property that includes the following:
• Street address or similar location information
• Assessor’s parcel number
• Existing use
• Number of units
• Whether the property is surplus land, exempt surplus land, or in excess of Palm Desert’s foreseeable need
• Size in acres
The information in the Central Inventory is to be used to complete Table H, which is the form prescribed by HCD for inclusion in the City’s annual progress report submitted pursuant to Government Code Section 65400(a)(2). The purpose of this request is to provide the City Council with the current Central Inventory, included hereto as Exhibit A, “City of Palm Desert Central Inventory”, pursuant to Government Code 54230(a)(1), for approval in accordance with the Act. The Central Inventory will serve as the central inventory for the City, and SARDA properties. Concurrently, staff is seeking authorization to report this information to HCD in Table H pursuant to Government Code 54230(a)(2).

Properties remain on the Central Inventory until disposed of or deemed to be exempt for public purposes. Since the City Council’s approval of the last Central Inventory on December 15, 2022, six (6) properties are in the process of being sold. These properties remain on the Central Inventory until sold.
 Desert Willow Lots C-D-E
 Desert Willow Lot A
 Alessandro Alley
 Wallaroo
 Joslyn Center (adjacent parcels)
 Mountain View (house)
The City Council has also already approved staff to release an NOA for the following properties:
 Fred Waring Drive and San Pablo Avenue
 Portola Avenue and El Cortez Way
 Entrada del Paseo

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City of Palm Desert
December 2023 – Central Inventory

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NOAs for the above referenced properties will be released in early to mid-2024.

Legal Review:

This report has been reviewed by the City Attorney’s office.

FINANCIAL IMPACT:

There is no fiscal impact associated with approval of the Central Inventory. When the sale of these properties occurs, professional real estate transaction services including a title review, appraisal, and escrow will be required. Funds are available for these purposes and are allocated to the Economic Development Department’s professional services account.

ATTACHMENTS:

1. December 2023 Central Inventory

2. Map of December 2023 Central Inventory Properties

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PALM DESERT CENTRAL INVENTORY - December 2023
Common Name Designation Address (Apprximate or Actual) APN Owner Acre Sf Current Use Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694190005 SARDA

5.00 217,800
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694190006 SARDA

0.02 871
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694190007 SARDA

8.54 372,002
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694190013 SARDA

2.55 111,078
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694190014 SARDA

5.03 219,107
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694190016 SARDA

0.21 9,148
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694200003 SARDA

4.89 213,008
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694200004 SARDA

7.90 344,124
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694200006 SARDA

0.05 2,178
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694200007 SARDA

8.81 383,764
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694200011 SARDA

81.50 3,550,140
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694200012 SARDA

2.20 95,832
Vacant
Excess of foreseeable needs NEC of Portola and Frank Sinatra Dr 694200022 SARDA

42.85 1,866,546
Vacant
Total
169.55 7,385,598
Alesandro Alley (non-contiguous)
Excess of foreseeable needs 44870 San Antonio Circle, Palm Desert, CA 92260 627071067 SARDA

0.25 10,890
Vacant
Excess of foreseeable needs 44850 San Antonio Circle, Palm Desert, CA 92260 627071068 SARDA

0.38 16,553
Vacant
Excess of foreseeable needs Alessandro Alley 627071065 City of Palm Desert

0.16 6,970
Vacant
Excess of foreseeable needs 44887 San Antonio Circle, Palm Desert, CA 92260 627071069 SARDA

0.14 6,098
Vacant
Excess of foreseeable needs 44845 San Clemente Circle, Palm Desert, CA 92260 627071070 City of Palm Desert

0.38 16,553
Vacant House
Excess of foreseeable needs 44889 San Clemente Circle, Palm Desert, CA 92260 627071071 City of Palm Desert

0.14 6,098
Vacant
Excess of foreseeable needs San Clemente Circle, Palm Desert, CA 92260 627074014 SARDA

0.42 18,295
Vacant
"170 Acre Site"

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PALM DESERT CENTRAL INVENTORY - December 2023
Common Name Designation Address (Apprximate or Actual) APN Owner Acre Sf Current Use Total

1.87 81,457
Excess of foreseeable needs East side of Desert Willow Drive, North of Country Club 620-400-025 SARDA

14.46 629,877
Vacant
Total

14.46 629,877
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-450-012 SARDA

16.91 736,600
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-450-013 SARDA

1.37 59,677
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-450-014 SARDA

0.45 19,602
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-450-016 SARDA

0.85 37,026
Vacant
Total

19.58 852,905
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-450-017 SARDA

0.19 8,276
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-450-018 SARDA

0.67 29,185
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-450-020 SARDA

13.67 595,465
Vacant
Total

14.53 632,926
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-370-002 City of Palm Desert

0.20 8,712
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-370-003 City of Palm Desert

0.20 8,712
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-370-004 City of Palm Desert

1.56 67,954
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-370-017 City of Palm Desert

0.69 30,056
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-370-018 City of Palm Desert

1.02 444,431
Vacant
Desert Willow Lot Pad C
Desert Willow Lot Pad D
Desert Willow Lot Pad E
Desert Willow Lot Pad A

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PALM DESERT CENTRAL INVENTORY - December 2023
Common Name Designation Address (Apprximate or Actual) APN Owner Acre Sf Current Use Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-370-020 City of Palm Desert

3.61 157,251
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-370-033 City of Palm Desert

0.94 40,946
Vacant
Excess of foreseeable needs NEC of Desert Willow Dr and Country Club Dr 620-370-043 City of Palm Desert

2.92 127,195
Vacant
Total

11.14 885,257
Entrada Del Paseo
Excess of foreseeable needs Next to 72599 CA-111 640370018 City of Palm Desert

2.01 85,365
Vacant
Excess of foreseeable needs Next to 72559 CA-111, Palm Desert, CA 92260 640370016 City of Palm Desert

0.68 23,823
Vacant
Total

2.69 109,188
Excess of foreseeable needs Haystack Drive 630250022 SARDA

1.9 82,764
Vacant
Total

1.9 82,764
Excess of foreseeable needs 45656 Mountain View, Palm Desert, CA 92260 627-351-024 City of Palm Desert

0.17 7,405
Vacant House
Total

0.17 7,405
Ocotillo Site
Excess of foreseeable needs 45330 Ocotillo Drive, Palm Desert, CA 92260 627232005 City of Palm Desert

0.53 23,156
Vacant
Total

0.53 23,156
Excess of foreseeable needs 45653 Portola Ave 627-351-010 City of Palm Desert

0.23 10,019
Vacant House
Total

0.23 10,019
Excess of foreseeable needs 44911 Cabrillo Avenue, Palm Desert, CA 92260 625-082-022 City of Palm Desert

0.27 11,761
Vacant Building
Excess of foreseeable needs 44911 Cabrillo Avenue, Palm Desert, CA 92260 625-082-023 City of Palm Desert

0.22 9,583
Vacant Building
Haystack
Wallaroo Center
Mountain View
Portola

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PALM DESERT CENTRAL INVENTORY - December 2023
Common Name Designation Address (Apprximate or Actual) APN Owner Acre Sf Current Use Total

0.49 21,344
Total City

15.93 1,085,990
Total SARDA
221.21 9,635,906
Total
237.14 10,721,896

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CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: December 14, 2023
PREPARED BY: Rosie Lua, Deputy Director of Development Services REQUEST: ADOPT A RESOLUTION EXTENDING THE CITY’S DEADLINE TO ESTABLISH AN ONLINE PERMITTING SYSTEM FOR POSTENTITLEMENT PHASE PERMITS UNDER CALIFORNIA GOVERNMENT CODE SECTION 65913.3.5 (AB 2234)
RECOMMENDATION:

Adopt a resolution entitled, “EXTENDING THE DEADLINE TO ESTABLISH AN ONLINE

PERMITTING SYSTEM FOR POST-ENTITLEMENT PHASE PERMITS UNDER CALIFORNIA GOVERNMENT CODE SECTION 65913.3.5 (AB 2234).”
BACKGROUND/ANALYSIS:

California Assembly Bill 2234 (“AB 2234”) took effect on January 1, 2023. AB 2234 added sections 65913.3 and 65913.3.5 to the Government Code and, most notably, extends elements similar to those of the Permit Streamlining Act to a local agency’s review of ministerial “postentitlement phase permit” applications for housing development project.

Under AB 2234, post-entitlement phase permits are all nondiscretionary permits and reviews filed after the entitlement process has been completed that are required or issued by the local agency to begin construction of a development that will be at least two-thirds residential.

Examples of post-entitlement phase permits include, but are not limited to: (i) building permits; (ii) permits of minor or standard off-site improvements; (iii) permits for demolition; or (iv) permits for minor or standard excavation and grading.

AB 2234 imposes numerous requirements on a local agency’s review and processing of a postentitlement phase permit application, including: (1) posting application checklists and examples online; (2) time limits to determine whether an application is complete; (3) time limits to approve or deny an application; (4) providing an applicant with the right to appeal the local agency’s decision; and (5) implementing an online permitting system.

This item before the City Council this evening concerns item (5) above, AB 2234’s online permitting system requirement.

DISCUSSION:

Among other things, AB 2234 requires local agencies that are located in counties with a population of 250,000 or greater to implement an online permitting system that allows applicants to apply for, check the status of, complete and retrieve post-entitlement phase permits. Local agencies in counties with a population of less than 250,000 are exempt from this online permitting system requirement.

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City of Palm Desert
(Extending the Deadline to Establish an Online Permitting System under State Law (AB 2234)

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For local agencies in counties with a population or 250,000 or greater, the deadline to comply with AB 2234’s online permitting system requirement is: (i) January 1, 2024 if the local agency has a population of 75,000 or greater or is located in a county with a population of 1.1 million or greater; or (ii) January 1, 2028 for all local agencies not covered by (1). The City of Palm Desert is subject to the January 1, 2024 deadline because the city is located within a county with a population greater than 1.1 million.

AB 2234 authorizes any local agency subject to the January 1, 2024 deadline to give itself an extension of up to two years (i.e., to January 1, 2026) if its legislative body does both of the following before January 1, 2024: (1) makes a written finding that adopting an online permitting system by January 1, 2024, would require substantial increases in permitting fees; and (2) has initiated a procurement process for the purpose of complying with the online permitting system requirement.

Implementing an online permitting system by the January 1, 2024 deadline would present several financial and logistical burdens for the City that, in turn, would require a substantial increase in permitting fees. The city is already transitioning from TRAKit, a Central Square permitting software to a new software system compliant with AB 2234. On November 16, 2023, the City Council awarded a contract to purchase and implement Clariti Permitting and Land Management System. The implementation of the new permitting software will not occur by January 1, 2024, therefore, an extension is requested to allow staff to implement the new software system by January 1, 2026.

The resolution attached as Attachment 1 makes the requisite findings and, if adopted by the City Council, will extend the City’s deadline to comply with AB 2234’s online permitting system requirement to January 1, 2026. As required by AB 2234, the resolution also includes directions to staff to procure and implement the new software system necessary to comply with this requirement. This process will be conducted in accordance with state law.

For the reasons provided above, staff recommends that the City Council adopt the attached resolution.

Legal Review:

This report has been reviewed by the City Attorney’s office.

Environment Review:

In accordance with the California Environmental Quality Act (“CEQA”) Guidelines, adopting the resolution is not subject to the California Environmental Quality Act (“CEQA”) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly.

FINANCIAL IMPACT:

There is no fiscal impact associated with this action.

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City of Palm Desert
(Extending the Deadline to Establish an Online Permitting System under State Law (AB 2234)

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ATTACHMENT:

1. Draft Resolution

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RESOLUTION NO. 2023- _____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY PALM DESERT,

CALIFORNIA EXTENDING THE DEADLINE TO ESTABLISH AN ONLINE

PERMITTING SYSTEM FOR POST-ENTITLEMENT PHASE PERMITS
UNDER CALIFORNIA GOVERNMENT CODE SECTION 65913.3.5 (AB
2234)
WHEREAS, California Assembly Bill 2234 (“AB 2234”) added sections 65913.3 and 65913.3.5 to the Government Code and took effect on January 1, 2023; and WHEREAS, AB 2234 extends elements similar to those of the Permit Streamlining Act to a local agency’s review of ministerial “post-entitlement phase permit” applications for housing development projects; and
WHEREAS, under AB 2234, a “post-entitlement phase permit” includes all nondiscretionary permits and reviews that are required or issued by the local agency after the entitlement process has been completed to begin construction of a development that is intended to be at least two-thirds residential. Examples include, among other things, building permits, demolition permits, and permits for minor or standard excavation and grading; and
WHEREAS, in addition to above, AB 2234 requires local agencies that are located in counties with a population of 250,000 or greater to implement an online permitting system that allows applicants to apply for, check the status of, complete and retrieve postentitlement phase permits (local agencies in counties with a population of less than 250,000 are exempt from this online permitting system requirement); and WHEREAS, for local agencies in counties with a population or 250,000 or greater, the deadline to comply with AB 2234’s online permitting system requirement is: (1) January 1, 2024 if the local agency has a population of 75,000 or greater or is located in a county with a population of 1.1 million or greater; or (2) January 1, 2028 for all local agencies not covered by (1); and
WHEREAS, the City of Palm Desert (“City”) is subject to the January 1, 2024 deadline because the county has a population greater than 1.1 million; and WHEREAS, any local agency subject to the January 1, 2024 deadline may give itself an extension of up to two years (i.e., to January 1, 2026) if its legislative body does both of the following before January 1, 2024: (1) makes a written finding that adopting an online permitting system by January 1, 2024, would require substantial increases in permitting fees; and (2) has initiated a procurement process for the purpose of complying with the online permitting system requirement; and
WHEREAS, the City desires to extend its deadline to comply with AB 2234’s online permitting system requirement to January 1, 2026; and

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Resolution No. 2023- ______
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Palm Desert, as follows:

SECTION 1. Recitals. The City Council hereby finds and determines that the recitals above are true and correct and are each incorporated by reference and adopted as findings by the City Council.

SECTION 2. CEQA. The City Council hereby finds that the adoption of this resolution is not subject to the California Environmental Quality Act (“CEQA”) pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly
SECTION 3. AB 2234 Findings; Direction to Staff. In accordance with Government Code section 65913.3.5(a)(2)(A)-(B):

1. Substantial Increase in Permitting Fees. The City Council hereby finds that implementing an online permitting system by January 1, 2024 would require substantial increases in the City’s permitting fees. The city is already transitioning from TRAKit, a Central Square permitting software to a new software system compliant with AB 2234.

On November 16, 2023, the City Council awarded a contract to purchase and implement Clariti Permitting and Land Management System. The implementation of the new permitting software will not occur by January 1, 2024, therefore, an extension is requested to allow staff to implement the new software system by January 1, 2026.

2. Initiation of Procurement Process. The City Council hereby directs staff to initiate the procurement and implementation process necessary to comply with AB 2234’s online permitting system requirements. Such process shall be in accordance with state law and the City’s applicable procurement policies.

SECTION 4. Extension. The City Council hereby elects to extend its deadline to implement an online permitting system to January 1, 2026.

SECTION 5. Effective Date. This resolution shall become effective immediately upon its adoption.

SECTION 6. Certification. The City Clerk shall certify to the passage and adoption of this resolution and enter it into the book of original resolutions.

ADOPTED On ______, 2023.
_______________________________

KATHLEEN KELLY

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Resolution No. 2023- ______
MAYOR
ATTEST:
_________________________________
ANTHONY J. MEJIA

CITY CLERK

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Resolution No. 2023- ______
I, Anthony J. Mejia, City Clerk of the City of Palm Desert, hereby certify that Resolution No. 2023- ___ is a full, true, and correct copy, and was duly adopted at a regular meeting of City Council of the City of Palm Desert on ________, by the following vote:

AYES:

NOES:

ABSENT:

ABTAIN:

RECUSED:

IN WITNESS WHEREOF, I have hereunto set my and affixed the official seal of the City of Palm Desert, California, on December ____, 2023

_________________________________
ANTHONY J. MEJIA

CITY CLERK

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CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: December 14, 2023
PREPARED BY: Liberty Urban, Deputy Director of Finance
REQUEST: ADOPT RESOLUTION MAKING CERTAIN FINDINGS PURSUANT TO CALIFORNIA GOVERNMENT CODE SECTIONS 66000-66008

RELATING TO THE DEVELOPMENT IMPACT FEES ANNUAL REPORT
FOR THE FISCAL YEAR ENDED JUNE 30, 2023
RECOMMENDATION:

Adopt a resolution entitled, “A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM

DESERT, CALIFORNIA, REVIEWING AND ACCEPTING THE ANNUAL DEVELOPMENT IMPACT FEE DISCLOSURE REPORT FOR THE CITY’S VARIOUS DEVELOPMENT IMPACT

FEES AND MAKING FIVE-YEAR FINDINGS REGARDING THE CONTINUING NEED FOR UNEXPENDED BALANCES OF IMPACT FEES AS OF JUNE 30, 2023, PURSUANT TO CALIFORNIA GOVERNMENT CODE SECTION 66001.”
BACKGROUND/ANALYSIS:

AB 1600 (Statutes of 1998, Mitigation Fee Act), codified as Section 66000 et seq. of the California Government Code (Code), regulates how public agencies collect, maintain, and spend impact fees imposed on developers for the purpose of defraying costs of public facilities. It includes requirements for accounting, spending, and annually reporting the fees and related interest earnings, and for findings or refunds if fees remain unspent five years after receipt.

Section 66006(b)(1) includes specific reporting requirements for each separate account or fund established pursuant to the Code, and the local agency shall, within 180 days after the last day of each fiscal year, make certain information available to the public. The attached resolution and report (Exhibit A to the resolution) prepared for the fiscal year ending June 30, 2023, provides the information required by the Code including the beginning and ending balances by fund as well as any changes during the year. The report also provides the amount of fees, interest, other income, expenditures, loans and proposed projects. Based on the findings, there were no required refunds made during the reported fiscal year.

The annual report also contains the required findings pursuant to Section 66001(d)(1), related to any funds that remain unexpended after five years. Also attached to this staff report is the City’s Capital Improvement Program report that contains related reporting information which has been incorporated therein by reference.

The City Council must review the annual report and make findings at a publicly held meeting.

The report must be made publicly available at least fifteen (15) days prior to the date of the public meeting. This report was filed with the City Clerk’s office and available for public review on November 29, 2023. A draft of the report, as well as notice of the time and place of this meeting, including the address where the report may be reviewed, was also mailed at least fifteen (15)

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City of Palm Desert
Development Impact Fees Annual Report

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days prior to the date of the meeting to any interested party that has on file with the City a written request for notice of such meetings.

All substantive and procedural requirements related to development impact fee reporting pursuant to the Mitigation Fee Act have been fulfilled at this time.

Legal Review:

This report has been reviewed by the City Attorney’s office.

FINANCIAL IMPACT:

There is no fiscal impact from filing the report and its findings.

ATTACHMENTS:

1. Resolution

2. FY 2022-23 Development Impact Fees Annual Report (Exhibit A to the Resolution)

3. Capital Improvement Program Budget for FY 2023-24 to FY 2027-28

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RESOLUTION NO. 2023-_____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT,

CALIFORNIA, REVIEWING AND ACCEPTING THE ANNUAL DEVELOPMENT IMPACT FEE DISCLOSURE REPORT FOR THE CITY’S VARIOUS

DEVELOPMENT IMPACT FEES AND MAKING FIVE-YEAR FINDINGS

REGARDING THE CONTINUING NEED FOR UNEXPENDED BALANCES OF IMPACT FEES AS OF JUNE 30, 2023, PURSUANT TO CALIFORNIA GOVERNMENT CODE SECTION 66001
WHEREAS, Government Code Sections 66000 through 66008 (known as and referenced to herein as “AB1600”) regulate the imposition, collections, maintenance, expenditure and reporting of impact fees imposed on developers for the purpose of defraying costs of public facilities; and
WHEREAS, the City of Palm Desert (“City”) has established, adopted, and imposed Housing Mitigation Fees, Child Care Facility Fees, New Construction Fees, Drainage Facility Fees, Park & Recreation Fees, Traffic Signalization Fees, and Fire Facility Fees (collectively the “Fees”); and
WHEREAS, in accordance with the provisions of AB1600, the City has set up separate special revenue funds for each type of Fee the City imposes (each a “Fund” and collectively the “Funds”), crediting earned interest to those Funds, and spending the accumulated Fees and related interest on appropriate expenditures; and
WHEREAS, the City has made available to the public within one hundred eighty (180) days following the last day of the fiscal year the annual development impact fee disclosure report (“Annual Report”) required by AB1600 related to each of the Fees which also includes the FiveYear Reports with respect to each of the Fees; and WHEREAS, the City has mailed notice at least fifteen (15) days prior to this meeting to all interested parties who have requested notice of any meeting relative to the City’s imposition of the Fees and has held a duly noticed, regularly scheduled public meeting at which oral and written testimony was received regarding the Annual Report and the Five-Year Reports at least fifteen (15) days after the City made this information publicly available; and WHEREAS, the City Council desires to accept the Annual Report, including the Five-Year Reports and to make the necessary findings required by law, with respect to the unexpended Fees.

NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF PALM DESERT RESOLVES, FINDS, DECLARES AND DETERMINES AS FOLLOWS:

Section 1. The City finds that all of the foregoing recitals are true and correct and are hereby incorporated and adopted as findings and determinations by the City Council as if fully set forth herein.

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Resolution No. 2023-_____

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Section 2. In accordance with Government Code Section 66006(b), the City Council has reviewed and approves the Annual Report regarding each of the Fees, which is attached to this Resolution and is incorporated herein by this reference, and is also placed on file with the City Clerk. The City Council, based upon the information contained in the Annual Report and the remaining need for the unexpended Fees, finds as follows:
a. The Annual Report describes the types of Fees contained in each Fund, including the amount of the Fees, the beginning and ending balances of each Fund that has been established for each Fee, as well as the amount of Fees collected, and the interest earned thereon; and
b. The Annual Report identifies each public improvement on which the Fees were expended, the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with the Fees; and c. Sufficient Fees have not been collected to complete the financing of the various incomplete public improvements; and
d. There have been no interfund transfers or loans made from any of the Funds; and
e. There have been no refunds made from the Funds.

Section 3. The City has identified Fees collected from developers that are subject to AB1600’s requirements. Those funds are:
 Housing Mitigation Fee (Fund 214)
 Child Care Facility Fee (Fund 228)
 New Construction Fee (Fund 231)
 Drainage Facility Fee (Fund 232)
 Park & Recreation Fee (Fund 233)
 Traffic Signalization Fee (Fund 234)
 Fire Facility Fee (Fund 235)
Section 4. In accordance with Government Code Section 66001(d), the City Council has reviewed the Five-Year Report sections included in the Annual Report for each of the Funds. The City Council finds, based on the information in the Five-Year Report sections, as follows:
a. Pursuant to Government Code Subsection 66001(d)(1)(A), the Five-Year Report identifies the purpose to which all unexpended Fees, whether committed or uncommitted, will be put; and
b. Pursuant to Government Code Subsection 66001(d)(1)(B), the Five-Year Report demonstrates, for each Fee, a reasonable relationship between the unexpended fees contained in each Fund and the purposes to which such Fees will be put; and c. Pursuant to Government Code Subsection 66001(d)(1)(C), the Five-Year Report identifies all sources and amounts of funding anticipated to complete financing of incomplete improvements or projects for each Fund; and

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Resolution No. 2023-_____

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d. Pursuant to Government Code Subsection 66001(d)(1)(D), the Five-Year Report identifies the approximate dates upon which the funding for such incomplete improvements or projects will be deposited in to each Fund; and e. There remains unexpended Fees in each Fund which are still necessary to complete the purposes for which the Fees were collected.

Section 5. These findings are based on the information provided in the City’s Annual Report, the City’s annual operating budget, and the Capital Improvement Program for Fiscal Year 2023-2024 to 2027-2028, which each are incorporated herein by this reference.

Section 6. Pursuant to these findings, and at this time, there shall not be a refund of any unexpended Fees.

Section 7. If any section, subsection, subdivision, sentence, clause, or phrase in this Resolution or any part thereof is for any reason held to be unconstitutional, invalid, or ineffective by any court of competent jurisdiction, such decision shall not affect the validity or effectiveness of the remaining portions of this Resolution or any part thereof. The City Council declares that it would have adopted each section irrespective of the fact that any one or more subsections, subdivisions, sentences, clauses, or phrases be declared unconstitutional, invalid, or ineffective.

Section 8. This Resolution shall be effective immediately upon its adoption.

PASSED, APPROVED AND ADOPTED at the regular meeting of the Palm Desert City Council held on this 14th day of December 2023, by the following vote, to wit:

AYES:

NOES:

ABSENT:

ABSTAIN:

KATHLEEN KELLY
MAYOR
ATTEST:

ANTHONY J. MEJIA, MMC, CITY CLERK

CITY OF PALM DESERT, CALIFORNIA

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EXHIBIT A
1) A brief description of the type of fee in the account or fund. 2) The amount of the fee.
3) The beginning and ending balance of each account or fund. 4) The amount of the fees collected and the interest earned.

The Development fee programs included in this report are the following:

Section A – Housing Mitigation Fee (Fund 214)
Section B – Child Care Facility Fund (Fund 228)
Section C – New Construction Tax Fee (Fund 231)
Section D – Drainage Facility Fee (Fund 232)
Section E – Park & Recreation Fee (Fund 233)
Section F – Traffic Signalization Fee (Fund 234)
Section G – Fire Facility Fund (Fund 235)
6) An identification of an approximate date by which the construction of the public improvement(s) will commence if the County determines that sufficient funds have been collected to complete financing of an incomplete public improvement(s), and the public improvement(s) remains incomplete.
7) A description of each interfund transfer or loan made from the account or fund, if any, including the public improvement on which the transferred or loaned fees will be expended, and, in the case of an interfund loan, the date on which the loan will be repaid, and the interest rate that the account or fund will receive on the loan. 8) The amount of refunds made due to sufficient funds being collected to complete financing on incomplete public improvements, and the amount of reallocation of funds made due to administrative costs of refunding unexpended revenues exceeding the amount to be refunded.

The City's Five Year Capital Improvement Program Budget is attached as a reference to future projects using existing cash balances for FY 2023-2024 through 2027-2028

CITY OF PALM DESERT

DEVELOPMENT IMPACT FEE ANNUAL REPORT
FISCAL YEAR 2022-2023
This report contains certain information required to be filed annually by the City of Palm Desert (the “City”) in accordance with the Mitigation Fee Act, commencing with Section 66000 of the California Government Code. The reporting requirements set forth in the Mitigation Fee Act (the “Act”) are applicable to the impact fees imposed on new development in the City. The Act requires that a public agency, on an annual basis, make available to the public within 180 days after the last day of each fiscal year the following information for the past fiscal year:
5) An identification of each public improvement on which fees were expended and the amount of the expenditures on each improvement, including the total percentage of the cost of the public improvement that was funded with fees.

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Section A– Housing Mitigation Fee (Fund 214)
Brief description of the type of fee in the fund:

Part I – Fund Balance, Revenue, Interest, Expenditures, Ending Balance 2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Beginning Balance 2,858,798 $ 3,026,646 $ 3,489,660 $ 3,575,892 $ 3,547,149 $ Developer Fees 113,651 $ $ 85,098 309,046 $ 27,247 $ 55,521 $ Interest Income 66,427 $ $ 25,560 65,569 $ 18,355 $ 89,967 $ Gain (Loss) on Fair Value-GASB 31 16,181 $ 11,002 $ (17,336) $ (68,100) $ 27,622 $ $ 385,617 196,258 $ 93,322 $ (22,498) $ 173,109 $
HCD Grant
Loan Proceeds - $ 90,000 $ - $ 30,000 $ 30,000 $
Interest on Loan - $ 22,387 $ - $ 12,802 $ 8,467 $
Expenditures (28,411) $ $ (7,090) (34,989) $ (49,048) $ (602,802) $ (a) Transfers out - $ - $ - $ - $ - $
Ending Fund Balance $ 3,489,66 3,026,646 $ 3,575,89 0 $ 3,547,14 2 $ 3,155,92 9 $ 4 (a) FY22-23 Expenditure Details: AMOUNT
HOMEBUYER SUBSIDIES 60,825 $
RICHARDS WATSON CVHC LGL SERVICE 31,274 $
BEST BEST & KRIEGER LLP 103 $
LAWYERS TITLE COMPANY 510,600 $
Total : 602,802 $
Transfers or Loans:

There have been no interfund transfers or loans made from the fund for this reporting period.

Refunds:

There have been no refunds made during this reporting period.

Part II – Compliance with expending funds within 5 years Five Year Revenue Test Using First In First Out
2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Current 196,258 $ 385,617 $ 93,322 $ (22,498) $ 173,109 $ Prior Year (2-Yrs Old) 65,574 $ 196,258 $ 385,617 $ 93,322 $ (22,498) $ Prior Year (3-Yrs Old) 258,212 $ 65,574 $ 196,258 $ 385,617 $ 93,322 $ Prior Year (4-Yrs Old) 273,417 $ 258,212 $ 65,574 $ 196,258 $ 385,617 $ Prior Year (5-Yrs Old) 57,767 $ 273,417 $ 258,212 $ 65,574 $ 196,258 $ Greater Than 5 Prior FY $ 1,512,378 1,489,600 $ 1,778,705 $ 1,987,870 $ 1,450,642 $ Ending Balance $ 2,691,45 2,340,829 $ 2,777,68 7 $ 2,706,14 9 $ 2,276,451 3 $ Exclude Loan Proceeds 626,699 $ 716,699 $ 716,699 $ 746,699 $ 776,699 $ (1) Exclude Interest on Loan 59,118 $ 81,505 $ 81,505 $ 94,307 $ 102,774 $ (1) Exclude HCD grant - $ - $ - $ - $
Ending Balance $ 3,489,66 3,026,646 $ 3,575,89 0 $ 3,547,14 2 $ 3,155,92 9 $ 4 Public Improvements to be Constructed:

FY 2023-2024
Budgeted
Expenditure
Future Years
Commitments
Total
Commitments
Funding
Available Date
Sands Apartments 200,000 $ - $ 200,000 $ July 2023
ARC Village Development (1.84 Acre Affordable Dev) $ - 600,000 $ 600,000 $ July 2023 45653 Portola (2-Single Family Homes Afford. Dev) $ - 600,000 $ 600,000 $ July 2023 Portola Palms MH Park (2-Single Family Homes Afford. Dev) $ - 550,000 $ 550,000 $ July 2023 170 Acre Affordable Dev - $ 600,000 $ 600,000 $ July 2024 Homebuyer Subsidies (Begin Prog.) $ 636,540 249,500 $ 886,040 $ July 2023 $ 1,236,54 2,199,500 $ 3,436,04 0 $ 0
Affordable Housing Projects
The Housing Mitigation Fee is used to mitigate the low-income housing impacts caused by commercial and industrial development. The fee is used to help construct or provide low-income housing assistance to employees, working within the juridictional boundaries of the city, with affordable housing. The fee is based on: $1/sq. ft. – Commercial; $0.33/sq. ft. – Industrial; $0.40/sq. ft. – Professional; $1,000/room – Resort Hotel; $620/Room Non-Resort.

The City's Five Year Capital Improvement Program Budget is attached as a reference to future projects using existing cash balances for FY 2023-2024 through 2027-2028
(1) Loan proceeds and interest from loans are program funds and are used to fund Homebuyer subsidies for programs meeting the requirements.

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Section A– Housing Mitigation Fee (Fund 214) - continued Five Year Findings
Purpose of the Fee:

The Relationship Between the Fee and Purpose:

Sources, Amounts, and Dates of Funding Anticipated to Complete Financing:

This fee is being collected for the purpose of subsidizing housing costs as part of the City's program to provide affordable housing for low and very low income households that have at least one employee working within the jurisdictional boundaries of the City.

Non-residential development within the City boundaries creates employment opportunities. The jobs created also create the need for additional residential development to locally house the employees that will fill these roles. Affordable housing is a known issue throughout the nation and the State of California. Therefore, new non-residential development pays a housing mitigation fee to help provide affordable housing to eligible low income families.

For the FY 2023-24 fiscal year, the city has budgeted for contributions from the Housing Mitigation Fund to fund multiple affordable housing projects. Included in these projects are the Sands Apartments, the ARC Village Development, homes at 45653 Portola, the Portola Palms Mobile Home Park, and a collection of subsidies provided through the BEGIN program. Additionally, in future years, the city intends to utilize these funds in a contribution to a 170-acre affordable housing development.

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2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Beginning Balance $ 1,332,828 $ 1,396,599 $ 1,479,283 $ 1,549,239 $ 673,863 Developer Fees $ 25,499 $ 50,309 $ 66,213 $ 32,945 $ 71,412 Interest Income $ 31,126 $ 27,992 $ 10,992 $ 6,823 $ 19,416 Gain (Loss) on Fair Value-GASB 31 $ 7,146 $ 4,384 $ (7,249) $ (15,143) $ 4,377 $ 63,771 $ 82,685 $ 69,956 $ 24,624 $ 95,204
Expenditures $ - $ - $ (900,000) - $ $
Transfers out $ - $ - $ - $ $ -
-
-
Ending Fund Balance $ 1,396,599 $ 1,479,283 $ 1,549,239 $ 673,863 $ 769,068 Transfers or Loans:

There have been no interfund transfers or loans made from the fund for this reporting period.

Refunds:

There have been no refunds made during this reporting period.

Part II – Compliance with expending funds within 5 years Five Year Revenue Test Using First In First Out
2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Current $ 63,771 $ 82,685 $ 69,956 $ 24,624 $ 95,204
Prior Year (2-Yrs Old) $ 59,452 $ 63,771 $ 82,685 $ 69,956 $ 24,624 Prior Year (3-Yrs Old) $ 76,387 $ 59,452 $ 63,771 $ 82,685 $ 69,956 Prior Year (4-Yrs Old) $ 175,924 $ 76,387 $ 59,452 $ 63,771 $ 82,685 Prior Year (5-Yrs Old) $ 29,520 $ 175,924 $ 76,387 $ 59,452 $ 63,771 Greater Than 5 Prior FY $ 991,545 $ 1,021,065 $ 1,196,989 $ $ 373,376 432,828 Ending Balance $ 1,396,599 $ 1,479,283 $ 1,549,239 $ 673,863 $ 769,068 Public Improvements to be Constructed:

FY 2022-23
Carryover
Projects
Future Years
Commitments
Total
Commitments
% Funded with
Dev. Fee
Funding
Available Date
Child Care Facilities (Hope Lutheran) 684,000 $ - $ 684,000 100% June 2024 $ 684,000 $ - $ 684,000
Five Year Findings
Purpose of the Fee:

The Relationship Between the Fee and Purpose:

The City's Five Year Capital Improvement Program Budget is attached as a reference to future projects using existing cash balances for FY 2023-2024 through 2027-2028
Section B – Child Care Facility Fee (Fund 228)
Brief description of the type of fee in the fund:

The City of Palm Desert is interested in providing funding, through impact fees for new child care homes and centers, in order to meet some of the child care demand generated by employees and commercial uses in the City. A nexus study was prepared and approved by the City Council in August 2005. Annually, the City considers projects and any applicable budget requests to use these funds to create new facilities and equipment.

Part I – Fund Balance, Revenue, Interest, Expenditures, Ending Balance In FY 2021-22, the City entered into an operating covenant with Bermuda Dunes Learning Center to use $900,000 to make improvements to accomodate 150 spaces for toddlers, preschoolers, and elementary-age children at 47549 Highway 74, south of St. Margaret's Episcopal Church.

This fee is being collected for the purpose of funding new child care homes and centers in order to meet growing demand for child care generated by employees and commercial uses within the city. It is envisioned that the City will partner with local child care providers and nonprofits to provide funding to increase the supply of child care spaces in the City.

Non-residential development within the City boundaries creates employment opportunities. In order to attract and retain highly skilled workers and their families, the City must have a variety of quality and affordable child care options. The quality and affordability of child care is a known issue in the Coachella Valley, as desirable facilities have long wait lists and there are no corporate child care centers in the entire Coachella Valley. Therefore, new non-residential development pays a child care impact fee to help support the City's effort to provide local providers and non-profits with funds to help increase the supply of child care spaces in Palm Desert.

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Section B – Child Care Facility Fee (Fund 228) - continued Sources, Amounts, and Dates of Funding Anticipated to Complete Financing:

The City is retaining developer fees currently held in the Child Care Facility Fund in anticipation of another request for funding by the end of 2024. The City also anticipates a contribution toward the funding of a Child Care Facility for Eisenhower Hospital in FY 2023-24, which will not be funded through developer fees due to its location, however, because of the hospital's close proximity to Palm Desert and the Palm Desert residents it serves, it was determined that a contribution toward this facility would be in the City's ongoing effort to enhance child care options.

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2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Beginning Balance $ 1,656,520 $ 1,342,716 $ 1,530,265 $ 1,078,653 $ 1,452,348 Developer Fees $ 174,981 $ 163,899 $ 121,565 $ 326,092 $ 518,442 Interest Income $ 27,570 $ 28,575 $ 5,444 $ 2,094 $ 43,369 Gain (Loss) on Fair Value-GASB 31 $ 6,845 $ 5,099 -$ (35,864) $ $ 9,116 $ 209,396 $ 197,573 $ 127,009 $ 292,321 $ 570,927
CVAG-Reimbursed CV Link Project $ 12,083 $ 5,141,123 $ 1,681,840 -$ Expenditures $ - $ (22,107) $ (5,719,744) $ (1,600,466) $ (a) (444,430) Write-off Advance to RDA $ (523,200) $ - -$ -$ -$
Ending Fund Balance $ 1,342,716 $ 1,530,265 $ 1,078,653 $ 1,452,348 $ 1,578,845 Exclude Advance to RDA write-off: $ (130,800) $ (130,800) $ (130,800) $ (130,800) -$ Ending Balance of available Revenue: $ 1,211,916 $ 1,399,465 $ 947,853 $ 1,321,548 $ 1,578,845 (a) FY22-23 Expenditure Details: AMOUNT
KOA CORPORATION-PD LINK DESIGN $ 207,045
CHRISP COMPANY - PD LINK CONSTRUCTION $ 237,385
Total : 444,430 $
Transfers or Loans:

There have been no interfund transfers or loans made from the fund for this reporting period.

Refunds:

There have been no refunds made during this reporting period.

Part II – Compliance with expending funds within 5 years Five Year Revenue Test Using First In First Out
2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Current $ 209,396 $ 197,573 $ (4,193,270) $ (360,292) $ (1) 570,927 Prior Year (2-Yrs Old) $ 170,421 $ 209,396 -$ -$ 292,321 $ Prior Year (3-Yrs Old) $ 204,788 $ 170,421 -$ -$ 127,009 $ Prior Year (4-Yrs Old) $ 228,499 $ 204,788 -$ -$ 197,573 $ Prior Year (5-Yrs Old) $ 208,723 $ 228,499 -$ -$ 209,396 $ Greater Than 5 Prior FY $ 190,089 $ 376,706 -$ -$ 181,619 $ Ending Balance $ 1,211,916 $ 1,387,383 $ (4,193,270) $ (360,292) $ 1,578,845 CVAG- Reimburse CV Link $ - $ 12,083 $ 5,141,123 $ 1,681,840 -$ Tie to ending balance on Fund Balance $ 1,211,916 $ 1,399,465 $ 947,853 $ 1,321,548 $ 1,578,845 Note: Not including interest on Advance
Section C – New Construction Fee (Fund 231)
Brief description of the type of fee in the fund:

The New Construction Fee is used for acquisition and development of public facilities like playgrounds, public structures, and street improvements. Annually, the City Council approves a five-year Capital Improvement Program budget that reflects current projects along with future committed projects utilizing these fees. The fee is based on: Industrial Buildings $0.05/sq. ft.; Residential units $0.40/sq. ft.; all other development $0.40/sq. ft.

Part I – Fund Balance, Revenue, Interest, Expenditures, Ending Balance (1) CVAG reimburses 100% of the CV Link project cost, excluding project design. The negative amount shown in FY 20- 21 and FY21-22 is before the CVAG reimbursement received.

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Section C – New Construction Fee (Fund 231) - continued Public Improvements to be Constructed:

FY 2022-23
Carryover
Projects
Future Years
Commitments
Total
Commitments
Funding
Available
Date
Cooperative
Agreement
$ 3,500,000 - $ 3,500,000 $ July 2024
CVAG to
reimburse
100% of cost
CV Link Enhancements - $ 500,000 $ 500,000 $ Sept. 2023 CVAG to
reimburse
95% of cost.
$ 4,000,000 - $ 4,000,000 $
Five Year Findings
Purpose of the Fee:

The Relationship Between the Fee and Purpose:

Sources, Amounts, and Dates of Funding Anticipated to Complete Financing:

Funds in the New Construction Tax Fund are expected to be fully expended through the completion of the CV Link Hovley Connectors and CV Link enhancements by the end of FY 2023-24. CV Link Hovley Connectors and CV Link enhancements also tie into the project known as "PD Link," which is designed to connect the CV Link with restaurants and attractions specific to the City of Palm Desert.

The City's Five Year Capital Improvement Program Budget is attached as a reference to future projects using existing cash balances for FY 2023-2024 through 2027-2028
This fee is being collected for the acquisition and development of public facilities like playgrounds, public structures, and street improvements.

New construction in the City creates a need for additional public facilities, structures, and street improvements. When new construction occurs, a new construction fee is paid to provide the city with funding to accommodate the addition of more homes and residents through more public facilities and streets.

CV Link Hovley Connectors

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2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Beginning Balance $ 1,592,857 $ 1,617,655 $ 664,009 $ 707,674 $ 740,536 Developer Fees $ 38,855 $ 18,020 $ 61,455 43,295$ $ 132,022 Interest $ 36,315 $ 5,247 22,881 $ 3,800$ $ 22,836
Gain (Loss) on Fair Value-GASB 31 $ 8,290 $ (2,466) $ (3,563) $ (14,233) $ 4,352 $ 83,460 $ 38,435 $ 63,139 $ 32,862 $ 159,211
Reimbursed from CVAG $ - $ - $ - $ - -$
Reimbursed from RDA $ - $ - $ - $ - -$
Expenditures $ (58,663) $ (992,081) $ (19,474) -$ $ (2,400) Transfers out $ - $ - $ - $ - -$
Ending Fund Balance $ 1,617,655 $ 664,009 $ 707,674 $ 740,536 $ 897,347 Transfers or Loans:

There have been no interfund transfers or loans made from the fund for this reporting period.

Refunds:

There have been no refunds made during this reporting period.

Part II – Compliance with expending funds within 5 years Five Year Revenue Test Using First In First Out
2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Current $ 83,460 $ 38,435 $ 63,139 $ 32,862 $ 159,211
Prior Year (2-Yrs Old) $ 29,182 $ 83,460 $ 38,435 $ 63,139 $ 32,862 Prior Year (3-Yrs Old) $ 48,726 $ 29,182 $ 83,460 $ 38,435 $ 63,139 Prior Year (4-Yrs Old) $ 155,837 $ 48,726 $ 29,182 $ 83,460 $ 38,435 Prior Year (5-Yrs Old) $ 13,372 $ 155,837 $ 48,726 $ 29,182 $ 83,460 Greater Than 5 Prior FY $ 1,081,608 $ 102,898 $ 239,262 $ $ 287,988 317,170 Ending Balance $ 1,412,185 $ 458,539 $ 502,204 $ 535,066 $ 694,276 Exclude Reimbursement:

Reimbursed from CVAG $ 105,235 $ 105,235 $ 105,235 $ 105,235 -$ Reimbursed from RDA $ 100,235 $ 100,235 $ 100,235 $ 100,235 -$ Tie to ending balance on Fund Balance $ 1,617,655 $ 664,009 $ 707,674 $ 740,536 $ 694,276 Public Improvements to be Constructed:

FY 2022-2023
Carryover
Future Years
Commitments
Total
Commitments
% Funded
with Dev.

Fee
Funding
Available
Date
$ 236,862 $ 263,138 $ 500,000 23% Nov. 2023
$ 236,862 $ 263,138 $ 500,000
Section 29 and Gerald Ford Drive Regional
Detention Basin
Section D – Drainage Facility Fee (Fund 232)
Brief description of the type of fee in the fund:

The Drainage Facility Fee is used for the drainage needs created by the development and adjoining streets to a project. The City has adopted a master drainage plan which gets modified as new development occurs. In addition, the City's Capital Improvement Program budget includes both current and future projects planned for use of the fees connected to the various development projects. Fees are based on which drainage map zone they reside within: Zone 1 fee is $4,000; Zone 2 is $1,000; Zone 3 is $1,000; Zone 4 is $1,000. The map is available in the Public Works Department upon request.

Part I – Fund Balance, Revenue, Interest, Expenditures, Ending Balance The City's Five Year Capital Improvement Program Budget is attached as a reference to future projects using existing cash balances for FY 2023-2024 through 2027-2028

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Section D – Drainage Facility Fee (Fund 232) - continued Five Year Findings
Purpose of the Fee:

The Relationship Between the Fee and Purpose:

Sources, Amounts, and Dates of Funding Anticipated to Complete Financing:

Project Funding Sources Funding %
Section 29 and Gerald Ford Drive Regional Detention Basin Drainage Fees 23% BAD Fees 77%
Expected Funding
June 2024
This fee is being collected for the purpose of ensuring developments within the city are properly connected to drainage and in compliance with the City's drainage master plan. The cost of drainage installation projects requires fund balances to be accumulated prior to implementing the capital budget and must also be timed with other improvements occurring around these capital projects.

To protect homes and businesses from potential flooding, the City has established a master drainage plan that is updated for new development. Additional non-residential development within the City boundaries creates employment opportunities, which in turn creates a need for additional housing and businesses in the City. When new homes or businesses are created, the City must adjust its master drainage plan and add in new areas that may not have been a drainage concern in the past. Therefore, new non-residential development pays a drainage facility fee to support the additional drainage needs caused by added employment, housing and business.

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2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Beginning Balance $ 1,662,454 1,416,407 $ 1,588,447 $ 1,599,06 $ 5 $ 1,708,631 Developer Fees $ 247,187 $ 4,453 $ 10,443 $ 133,411 $ 70,597 Refund Developer Fees $ - $ - $ - $ - $ -
Interest $ 36,237 $ 32,590 $ 11,526 $ 8,620 $ 48,195
Gain (Loss) on Fair Value-GASB 31 $ 8,485 $ 4,058 $ (8,102) $ (32,465) $ 11,599 $ 291,909 $ 41,101 $ 13,867 $ 109,566 $ 130,391
Expenditures $ (45,862) $ (115,108) $ (3,249) $ (208,754) - $ Transfers out $ - $ - $ - $ - $ -
Ending Fund Balance $ 1,588,447 1,662,454 $ 1,599,06 $ 5 $ 1,708,631 $ 1,630,268 Exclude Insurance reimb:

Insurance reimb. playground $ (33,570) $ (33,570) $ (33,570) $ (33,570) $ (33,570) Reimburse playground equipment $ (164,713) $ (164,713) $ (164,713) $ (164,713) $ (164,713) Insurance reimb. damage $ (159,113) $ (159,113) $ (159,113) $ (159,113) $ (159,113) SARDA reimb shade structure $ (15,896) $ (15,896) $ (15,896) $ (15,896) $ (15,896) Ending Balance $ 1,215,15 1,289,162 $ 5 $ 1,225,773 $ 1,335,339 $ 1,256,976 Transfers or Loans:

There have been no interfund transfers or loans made from the fund for this reporting period.

Refunds:

There have been no refunds made during this reporting period.

Part II – Compliance with expending funds within 5 years Five Year Revenue Test Using First In First Out
2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Current $ 291,909 $ 41,101 $ 13,867 $ 109,566 $ 130,391 Prior Year (2-Yrs Old) $ 34,936 $ 291,909 $ 41,101 $ 13,867 $ 109,566 Prior Year (3-Yrs Old) $ 322,198 $ 34,936 $ 291,909 $ 41,101 $ 13,867 Prior Year (4-Yrs Old) $ 309,926 $ 322,198 $ 34,936 $ 291,909 $ 41,101 Prior Year (5-Yrs Old) $ 84,574 $ 309,926 $ 322,198 $ 34,936 $ 291,909 Greater Than 5 Prior FY $ 245,618 $ 215,084 $ 521,761 $ $ 843,959 670,141 Ending Balance $ 1,215,15 1,289,162 $ 5 $ 1,225,773 $ 1,335,339 $ 1,256,975 Public Improvements to be Constructed:
% Funded with
Dev. Fee
Funding
Available Date
North Sphere Community Park 5% July 2025
North Sphere Regional Sports Park 2% April 2026
Section E– Park & Recreation Fee (Fund 233)
Brief description of the type of fee in the fund:

The fee is used to acquire land, construct parks, recreational areas, open space, and other public facilities for the city residents. Annually, the City Council adopts a Capital Improvement Program Budget detailing the current and future projects necessary for use of the fee. The fee is charged to residential properties based on the following formula: Number of units x

2.292 (people per household) x 5 acres divided by 1,000 population x land market value per acre.

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Section E– Park & Recreation Fee (Fund 233) - continued Five Year Findings
Purpose of the Fee:

The Relationship Between the Fee and Purpose:

Sources, Amounts, and Dates of Funding Anticipated to Complete Financing:

When new development occurs within the City boundaries, there becomes a need to support new homes and residents with additional park and recreational activities. Therefore, new residential developments must pay a Park & Recreation Fee, which may be used to create new areas for playgrounds, playfields, gardens, pedestrian or bicycle paths or areas of particular natural beauty, including canyons, hilltops and wooded areas to be developed in their natural state.

Funding sources for the North Sphere Community Park and the North Sphere Regional Sports Park are still being researched and determined while both parks are in the design phase. The current 5-year CIP anticipates the Community Park will cost approximately $10,150,000 and the Regional Park will cost approximately $30,000,000. The City expects to fully expend the accumulation of Park & Recreation Fees to supplement the completion of these parks.

This fee is being collected for the purpose of developing new parks or recreational facilities to serve the community. With the expansion of the North Sphere of the city over the last five years, funds are being accumulated to help support the building of both a North Palm Desert Community Park and a Regional Sports Park.

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2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Beginning Balance $ 410,318 $ 496,178 $ 417,052 $ 436,491 $ 438,750 Developer Fees 91,274 $ $ 18,467 29,677 $ 8,400 $ 70,931 $ Interest Income 9,965 $ $ 3,062 9,682 $ 2,259 $ 13,140 $ Gain (Loss) on Fair Value-GASB 31 2,537 $ $ 765 $ (2,090) $ (8,400) $ 2,713 $ 103,775 $ 40,124 $ 19,439 $ 2,259 $ 86,784
Expenditures $ (17,915) $ (119,250) $ - $ - $ -
Transfers out $ - $ - $ - $ - $ -
Ending Fund Balance $ 496,178 $ 417,052 $ 436,491 $ 438,750 $ 525,534 Transfers or Loans:

There have been no interfund transfers or loans made from the fund for this reporting period.

Refunds:

There have been no refunds made during this reporting period.

Part II – Compliance with expending funds within 5 years Five Year Revenue Test Using First In First Out
2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Current $ 103,775 $ 40,124 $ 19,439 $ 2,259 $ 86,784
Prior Year (2-Yrs Old) $ 21,424 $ 103,775 $ 40,124 $ 19,439 $ 2,259 Prior Year (3-Yrs Old) $ 38,654 $ 21,424 $ 103,775 $ 40,124 $ 19,439 Prior Year (4-Yrs Old) $ 103,710 $ 38,654 $ 21,424 $ 103,775 $ 40,124 Prior Year (5-Yrs Old) $ 17,722 $ 103,710 $ 38,654 $ 21,424 $ 103,775 Greater Than 5 Prior FY $ 210,893 $ 109,365 $ 213,075 $ $ 251,729 273,153 Ending Balance $ 496,178 $ 417,052 $ 436,491 $ 438,750 $ 525,534 Public Improvements to be Constructed:

FY 2022-2023
Carryover
Projects
Future Years
Commitments
Total
Commitments
% Funded with
Dev. Fee
Funding
Available Date
$ 225,000 $ 235,075 $ 460,075 47% June 2024
$ 225,000 $ 235,075 $ 460,075
Section F – Traffic Signalization Fee (Fund 234)
Brief description of the type of fee in the fund:

The fee is used for acquisition and development of the regional traffic signals within the City created by increased traffic load added by the development. Yearly, the City Council adopts a five-year Capital Improvement Plan detailing the current and future projects necessary for use of the fee. The fee is charged based on the type of building constructed, which is:

Residential $ 50 per unit; Commercial $500 per 1,000 sq. ft.; Industrial $500 per acre.

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Section F – Traffic Signalization Fee (Fund 234) - continued Five Year Findings
Purpose of the Fee:

The Relationship Between the Fee and Purpose:

Sources, Amounts, and Dates of Funding Anticipated to Complete Financing:

Project Funding Sources Funding %
Market Place Drive and Cook Street Signal Traffic Signal Fees 47% Measure A 53%
As development in the city expands, more people drive on City streets, which can lead to traffic congestion or necessitate changes in traffic signaling and patterns. As a result, developers are required to pay a traffic signalization fee. This fee is used to add new traffic signals or intersection projects to accomodate the increased traffic flow caused by development.

This fee is being collected for the purpose of the construction or reimbursement of intersection of signalization projects within the City. Funds have accumulated in this fund over the last five years in order to pay for projects of significant cost.

The process for addition of a new traffic signal at Market Place Drive and Cook Street began in May 2023 and is expected to expend the majority of accumulated fund balance during FY 2023-24.

Expected Funding
June 2024

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2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Beginning Balance $ 1,108,171 $ 1,153,479 $ 1,212,787 $ 1,261,388 $ 1,368,086 Developer Fees $ 13,655 $ 32,713 $ 45,624 $ 125,925 $ 297,648 Interest Income $ 25,750 $ 23,043 $ 8,943 $ 6,708 $ 40,590 Gain (Loss) on Fair Value-GASB 31 $ 5,903 $ 3,552 $ (5,966) $ (25,936) $ 8,599 $ 45,308 $ 59,308 $ 48,601 $ 106,698 $ 346,837
Expenditures $ - $ - $ - $ - $ (134,222)
Transfers out $ - $ - $ - $ - $ -
Ending Fund Balance $ 1,153,479 $ 1,212,787 $ 1,261,388 $ 1,368,086 $ 1,580,701 Transfers or Loans:

There have been no interfund transfers or loans made from the fund for this reporting period.

Refunds:

There have been no refunds made during this reporting period.

Part II – Compliance with expending funds within 5 years Five Year Revenue Test Using First In First Out
2018-2019 2019-2020 2020-2021 2021-2022 2022-2023
Current $ 45,308 $ 59,308 $ 48,601 $ 106,698 $ 346,837
Prior Year (2-Yrs Old) $ 35,084 $ 45,308 $ 59,308 $ 48,601 $ 106,698 Prior Year (3-Yrs Old) $ 41,063 $ 35,084 $ 45,308 $ 59,308 $ 48,601 Prior Year (4-Yrs Old) $ 53,168 $ 41,063 $ 35,084 $ 45,308 $ 59,308 Prior Year (5-Yrs Old) $ 43,193 $ 53,168 $ 41,063 $ 35,084 $ 45,308 Greater Than 5 Prior FY $ 935,663 $ 978,856 $ 1,032,023 $ 1,073,086 $ 1,108,170 Ending Balance $ 1,153,479 $ 1,212,787 $ 1,261,388 $ 1,368,086 $ 1,714,922 Public Improvements to be Constructed:

FY 2022-23
Carryover
Projects
Future Years
Commitments
Total
Commitments
% Funded with
Dev. Fee
Funding
Available Date
North Sphere Fire Station $ 1,151,512 $ 645,600 $ 1,797,112 10% Late 2026 Five Year Findings
Purpose of the Fee:

The Relationship Between the Fee and Purpose:

Section G – Fire Facility Fee (235)
Brief description of the type of fee in the fund:

The City of Palm Desert is interested in providing funding, through impact fees for a new Fire Station and equipment, in order to meet some of the new commercial and residential development in the northern half of the City. A Nexus study was prepared and approved by City Council in June 2006. The fee is calculated as follows: Commercial development rate is $0.22 per square foot, industrial/office rate is $0.20 per square foot, and residential development would be based on a $2,262 per acre depending on density of units built or $709 per single residence. Annually, the City will adopt a budget to use these funds to create new facilities and equipment.

Part I – Fund Balance, Revenue, Interest, Expenditures, Ending Balance This fee is being collected for the development of a new Fire Station and equipment in order to meet some of the new commercial and residential development in the North Sphere of the City. The North Sphere Fire Station is currently going through the study and design phase through March 2024, and is expected to go into construction in late 2026.

Residential and commercial development in the Northern Sphere of the city has necessitated the addition of a new fire station to support emergency response for the City. When additional development expands the population of an area or changes the distribution of the population, emergency responders must cover a wider variety of territory and responses. The addition of a new fire station allows for fast response times and adequate emergency coverage in all areas of the City.

The City's Five Year Capital Improvement Program Budget is attached as a reference to future projects using existing cash balances for FY 2023-2024 through 2027-2028

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Section G – Fire Facility Fee (235) - continued
Sources, Amounts, and Dates of Funding Anticipated to Complete Financing:

Funding sources for the North Sphere Fire Station are still being explored while the project is in the study and design phase. It is expected that the existing accumulation of developer fees will be fully utilized upon station construction, along with other funding sources that have yet to be determined. The total cost of the fire station is currently approximately $18.6 million.

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Project Name Account No. 2022/23
Carryover*
2023/24
Year 1
2024/25
Year 2
2025/26
Year 3
2026/27
Year 4
2027/28
Year 5 Total
Catch Basin &Inlet Modifications 2114311-4332000 105,000 105,000 105,000 105,000 105,000 525,000 Clubhouse Equipment Various 4414195-4809200 85,000 75,000 - 135,000 - - 295,000 Golf Cart Paths 4414195-4809200 16,500 50,000 10,000 20,600 71,218 21,854 190,172 Corporation Yard Building Improv 4004330-4400100 350,000 100,000 100,000 75,000 75,000 700,000 Historical Society Building Improv 4504164-4400100 125,000 100,000 100,000 100,000 100,000 525,000 Clubhouse Improve-Roofing &Others 4414195-4809200 70,000 192,000 105,000 55,000 120,000 150,000 692,000 Golf Course Pump & Motor Upgrades 4414195-4809200 30,000 33,000 - 300,000 40,000 - 403,000 Perimeter Landscaping 4414195-4332000 250,000 260,000 270,400 281,216 292,465 292,465 1,646,546 Parks & Medians Cal Sense /Smart Controller Irrigation Upgrades 4004388-4400100 50,000 50,000 50,000 - - 150,000 Walk n Roll PD 2134633-5000103 2,150,000 500,000 500,000 500,000 500,000 4,150,000 Neighborhood Traffic Calming Program 2134565-5000903 150,000 150,000 150,000 150,000 150,000 750,000 Sidewalk Replacement Program 2134310-5000205 275,000 100,000 100,000 100,000 100,000 675,000 Motorcycle Replacement 2294210-4391400 34,000 35,000 36,000 - - 105,000 Public Buildings Furnishings 4504161-4400100 75,000 75,000 75,000 75,000 75,000 375,000 Vehicle Leases Maintenance 1104331-4334000 40,000 - - - - 40,000 AD Annual R/M 3034311-4332000 24,511 - 24,511
AD Annual R/M 3044311-4332000 188,669 - - 188,669
AD Annual R/M 3064311-4332000 121,231 - - - - 121,231
AD Annual R/M 3074311-4332000 - 324,833 - 324,833
AD Annual R/M 3084311-4332000 101,978 - - 101,978
AD Annual R/M 3514311-4332000 1,173,458 - - - - 1,173,458 Parking Lot Rehab&Maint 1104313-4332000 200,000 150,000 150,000 150,000 150,000 800,000 Citywide Pavement Condition Evaluation 2114311-4391505 100,000 250,000 105,000 110,000 110,000 675,000 Bridge Inspection & Repair Program 2134359-4400100 320,000 1,000,000 700,000 2,000,000 300,000 300,000 4,620,000 Civic Center Complex Improve 4504161-4400100 350,000 350,000 250,000 250,000 250,000 1,450,000 iHUB Rent & Operating Cost 1104199-4501000 - 31,000 387,000 324,000 324,000 1,066,000 iHUB Rent & Operating Cost 4254430-4345000 207,484 213,709 104,116 104,780 104,780 734,869 iHUB Rent & Operating Cost 4254430-4395000 260,468 232,103 - - - 492,571 Fire Station 33 Building Improv 2304220-4400100 165,000 290,000 150,000 150,000 150,000 905,000 Fire Station 67 Building Improv 2304220-4400100 465,000 75,000 75,000 - - 615,000 Fire Station 71 Building Improv 2304220-4400100 130,000 195,000 150,000 150,000 150,000 775,000 Median Landscape Rehabilitation 1104614-4337001 150,000 150,000 150,000 150,000 150,000 750,000 Park Playground Improv 1104618-4400100 75,000 75,000 75,000 75,000 75,000 375,000 Pickleball, Tennis, &Basketball Court Resurfacing 1104618-4400100 45,000 75,000 75,000 75,000 75,000 345,000 Pickleball, Tennis, &Basketball Court Resurfacing 1104674-4400100 30,000 - - - - 30,000 Citywide Street Striping &Lane Improv 2134315-4332000 300,000 200,000 200,000 200,000 200,000 1,100,000 Bike Lane Striping 2134633-5000204 - 150,000 - 150,000 150,000 450,000 Street Resurfacing Program 2114311-4332000 1,000,000 2,000,000 2,000,000 2,000,000 2,000,000 9,000,000 Street Resurfacing Program 2114311-4391505 1,000,000 - - - - 1,000,000 Street Resurfacing Program 2134311-4332000 1,900,000 1,750,000 1,895,000 1,890,000 1,890,000 9,325,000 ADA Curb Ramp Modifications 1104312-4332000 25,000 25,000 25,000 25,000 25,000 125,000 ADA Curb Ramp Modifications 2134312-4400100 50,000 50,000 50,000 50,000 50,000 250,000 Traffic Operations &Capacity Improv 2134250-5000907 750,000 750,000 750,000 750,000 750,000 3,750,000 Traffic Signal & Interconnect Equipment Upgrade &Replacement 2134250-5000906 750,000 1,120,000 560,000 560,000 560,000 3,550,000 Traffic Signal & Interconnect Equipment Upgrade &Replacement 2344250-4400100 - - - 75,000 75,000 150,000 Desktop-Laptops 5304190-4404000 81,578 318,562 286,783 325,655 460,072 340,183 1,812,833 Eisenhower Health Child Care Center Contribution 4514800-4388300 500,000 1,000,000 1,000,000 - - 2,500,000 Homebuyer Subsidies - BEGIN Program 2144494-4390102 95,000 154,500 159,135 159,135 159,135 159,135 886,040 Housing Mitigation 2144490-4390101 - 250,000 250,000 250,000 250,000 250,000 1,250,000 Vehicle Leases 5304331-4344000 92,505 96,000 - - - - 188,505 Catch Basin &Inlet Modifications 4204314-4332000 80,000 - - - - - 80,000 Catch Basin &Inlet Modifications 4204370-4400100 25,000 - - - - - 25,000 Golf Cart Leases - Principal Only 5200000-2341001 112,568 470,392 482,287 494,483 251,911 - 1,811,641 Fire Station 71 Tenant Improve 2304220-4400100 300,000 300,000 300,000 300,000 300,000 300,000 1,800,000 Course & Ground Leases - Principal Only 5200000-2341001 74,859 396,691 406,722 417,008 427,553 144,907 1,867,740 TOTALS 1,633,010 16,988,433 13,666,483 14,105,213 11,016,134 10,302,324 67,711,597

CAPITAL IMPROVEMENT FUNDS PROGRAM
CIP List
Nonrecurring Projects
233

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Project Name Account No. 2022-23
Carryover*
2023-24
Year 1
2024-25
Year 2
2025-26
Year 3
2026-27
Year 4
2027-28
Year 5 Total
Haystack Channel Rehab 4204370-5000454 3,200,000 - - - - 3,200,000 Section 29 &Gerald Ford Drive Improv on Detention Basins & Storm Dra 2324370-5000455 236,862 263,138 - - - - 500,000 Section 29 &Gerald Ford Drive Improv on Detention Basins & Storm Dra 2894374-5000455 2,200,000 - - - - 2,200,000 Civic Center Irrigation Pump Replacement 4004674-4400100 750,000 750,000 Clubhouse Equipment Various 5204195-4809200 94,000 128,500 80,683 117,937 94,104 111,191 626,415 Artwork for New Visitor Center (Discover Palm Desert) 4364650-4400100 25,000 - - - - 25,000 New Visitor Center - Discover Palm Desert 4004419-4400100 - New Visitor Center - Discover Palm Desert 4514419-4400100 1,071,300 - - - - - 1,071,300 Civic Center Photovoltaic 4504161-4400100 250,000 250,000 Fire Station 102 2304220-4400100 3,400,000 3,400,000
Fire Station 102 2354270-4400100 1,151,512 645,600 - - - - 1,797,112 Fire Station 102 PA2 4514270-4400100 3,000,000 3,000,000 Fire Station 102 PA4 4514270-4400100 15,677,730 15,677,730 Civic Center Park Dog Park Improv 4004674-4400100 450,000 450,000 Desert Recreation District Building Improv 4514164-4400100 12,500,000 - - - - 12,500,000 Artists Center at Galen Improv 4504164-4388500 450,000 75,000 - - - 525,000 DS Office Space Improv- Phase 1 4504164-4400100 - - - - - - DS Office Space Improv- Phase 2 N/A 5,000,000 - - - 5,000,000 DSOffice Space Improv- Phase 3 N/A 4,000,000 4,000,000
Facilities Maint Master Plan 4504164-4309000 100,000 - - - - 100,000 City Childcare Facility 2284800-4400100 684,000 - - - - - 684,000 Henderson Building improv 4504164-4400100 250,000 270,000 - - - 520,000 Golf Course Pump & Motor Upgrades 5204195-4809200 37,000 37,000 DW Perimeter Landscape &Lighting Rehabilitation 4414195-4809200 300,000 1,200,000 - - - - 1,500,000 Community Gardens Box Renovation 4004618-4400100 100,000 - - - - 100,000 North Sphere Community Park - Future Improv 4514618-5000913 150,000 150,000 North Sphere Community Park - Future Improv N/A 5,000,000 5,000,000 - - 10,000,000 Hovley Soccer Park Improv 4004618-4400100 450,000 450,000 Homme Adams Park New Prefabricated Restroom 4004618-4400100 150,000 - - - - 150,000 University Dog Park Fence Replacement 4004618-4400100 200,000 - - - - 200,000 North Sphere Regional Park - Future Improv N/A 15,000,000 15,000,000 30,000,000 Market Place Drive &Cook Street Traffic Signal improv 2134385-5000911 150,000 364,925 - - - - 514,925 Market Place Drive &Cook Street Traffic Signal improv 2344250-4400100 225,000 235,075 - - - - 460,075 Artwork for Phase 2 of the PD Link Project 4364650-4400100 50,000 50,000 50,000 - - 150,000 PD Link 2134670-5000202 4,050,000 3,460,000 250,000 250,000 250,000 8,260,000 Artwork for Phase 2 of the Haystack Road Traffic Calming Project 4364650-4400100 50,000 - - - - 50,000 Haystack Road Traffic Calming Improve 2134565-5000909 1,000,000 - - - - - 1,000,000 CV Link Hovley Connector 2314670-5000202 - 3,500,000 - - - 3,500,000 President's Plaza East & West Parking Lot Rehabilitation 4004692-4400100 150,423 - - - - 150,423 El Paseo Mid-Block Crossing 2134311-4332000 750,000 1,000,000 - - - 1,750,000 El Paseo Mid-Block Crossing 4514679-5000102 250,000 250,000 - - - - 500,000 Lupine Plaza 4004430-5000912 3,000,000 3,000,000
Geodetic Survey Control Network 4004300-4309000 - - 80,000 - - 80,000 Safe Routes to Schools Plan 2134300-5000910 250,000 670,000 - - - - 920,000 Technology Drive Extension to Gerald Ford Drive 1104311-4332000 300,000 - - - - 300,000 Artwork for Phase 1 of the San Pablo Corridor Project 4364650-4400100 266,714 - - - 266,714 Artwork for Phase 2 of the San Pablo Corridor Project 4364650-4400100 200,000 - - - - 200,000 CV Link Enhancements 2314670-5000202 500,000 - - - - 500,000 Vitalia Way &Gerald Ford Drive Traffic Signal improv 2134385-5000911 750,000 - - - - 750,000 Undergrounding Utilities 4004256-4400100 75,155 - - - - 75,155 Undergrounding Utilities 4514256-4400100 - 750,000 - - - 750,000 Course &Ground Equipment 5204195-4809200 79,500 - - - - - 79,500 City Hall Roof Improve 4504161-4400100 250,000 150,000 150,000 550,000 Parkview Office Complex - Facility Improve 5104361-4400100 1,388,624 2,250,000 - - - 1,500,000 5,138,624 Parking Lot rehab&Maintenance 4414195-4809200 40,000 - - - - 40,000

CAPITAL IMPROVEMENT FUNDS PROGRAM
CIP List
Annual Projects
234

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Project Name Account No. 2022-23
Carryover*
2023-24
Year 1
2024-25
Year 2
2025-26
Year 3
2026-27
Year 4
2027-28
Year 5 Total
Parking Lot rehab&Maintenance 5104195-4332000 20,000 - - - - 20,000 Portola Community Center Renovations 4004439-4391503 - 50,000 - - - 50,000 Portola Community Center Renovations 4504439-4400100 100,000 - - - - 100,000 Mountain View - Golf Course Improve 4414195-4809200 20,000 - - - 250,000 3,500,000 3,770,000 Palm Desert Aquatic Center 2424549-4400100 1,250,000 2,750,000 1,040,000 170,000 - 5,210,000 Fire Cliff - Golf Course Improve 4414195-4809200 20,000 2,760,000 - 50,000 40,000 2,870,000 Fire Station 33 Fuel Tank Shade Structure 2304220-4400100 100,000 - - - - - 100,000 Freedom Park Sculpture Repairs 4364650-4400100 188,390 - - - - - 188,390 Freedom Park Shade Replacements 4004618-4400100 100,000 100,000 Cahuilla Hills Park Shade Structure 1104618-4400100 - 900,000 - - - 900,000 Bump n Grind Trailhead New Prefabricated Restroom 4004618-4400100 223,982 - - - - - 223,982 Palma Village Park Improve 2204649-4400100 212,000 100,000 - - - - 312,000 Palma Village Park Improve 4004618-4400100 220,000 220,000 Citywide Wayfinding Signage 2134300-5000910 - 250,000 250,000 500,000 Roadway Safety Improve 2134317-5000908 1,180,954 - - - - - 1,180,954 Ambulance Purchase/Remounts 5304220-4403000 208,000 - 235,000 - - 443,000 City Hall Charging Stations 5304310-4404500 75,000 350,000 425,000 Concrete Truck 5304310-4403000 100,000 100,000
Corporate Yard Generator 5304310-4404500 125,000 - - - - - 125,000 Desert Surf 4514430-5000203 - - - - -
Dump Trailer 5304310-4403000 20,000 20,000
EV Carpools 5304310-4403000 150,000 150,000
Graffiti Truck 5304310-4403000 110,000 110,000
Ladder Truck 33 Equipment 5304220-4403000 500,000 - - - - - 500,000 Living Desert Program Contribution 4004800-4389800 - - - - McCallum Theater Program Contribution 4004800-4389800 200,000 - - - - 200,000 Mini Excavator 5304310-4403000 60,000 60,000
Paramedic Squad 5304220-4403000 - - - - - -
Stryker Gurneys 5304220-4403000 126,000 - - - - 126,000 Utility Golf Cart 5304310-4403000 40,000 40,000
Economic Development Business Enhancements 4254430-4387500 650,000 - - - - - 650,000 Invest- Palm Desert 4254430-4393000 31,475 - - - - - 31,475 PDHA Replacement Expenditures 8714195-4331100 2,852,840 - - - 2,852,840 TOTALS 13,252,153 61,891,546 27,145,683 25,922,937 15,814,104 5,401,191 149,427,614

CAPITAL IMPROVEMENT FUNDS PROGRAM
CIP List
Annual Projects Continued

235

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Page 1 of 2 ends

CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: December 14, 2023
Nd
PREPARED BY: Martin Alvarez, Director of Public Works
REQUEST: AUTHORIZE THE REMOUNT AND REFURBISHMENT OF TWO ALS

PARAMEDIC UNITS FROM FRAZER, LTD, FOR A TOTAL AMOUNT OF $551,410.64
RECOMMENDATION:

1. Authorize the remount and refurbishment of two ALS Paramedic Units from Frazer, LTD, of Houston, Texas, for the amount of $551,410.64.

2. Authorize the Director of Finance to appropriate and transfer out a total of $25,248.00 from Unobligated Fire Facilities Fund Balance to Equipment Replacement Fire Vehicles Account No. 5304220-4403000.

BACKGROUND/ANALYSIS:

The ALS Paramedic Unit for Station 33 has been in service for 11 years. This unit has 118,980 miles and reached its recommended lifespan without refurbishment. In 2019, Medic Unit 233 was scheduled to be remounted on a new chassis, and the medic box was scheduled to be refurbished. Due to the pandemic and the unavailability of equipment, the unit refurbishment was postponed.

The ALS Paramedic Unit for Station 71 has been in service for 11 years. This unit has 91,464 miles and reached its recommended lifespan without refurbishment. This unit also needs a new chassis, and the medic box also requires refurbishment. In 2019, Medic Unit 271 was also scheduled to be remounted on a new chassis, and the medic box was scheduled to be refurbished. Due to the pandemic and the unavailability of equipment, the unit refurbishment was also postponed.

The Fire Department requests authorization to remount two ALS Paramedic Units (Medic 233 and Medic 271) onto two 2024 Ford F-450 Gas 4 X 2 Super Cab Chassis and refurbish the two individual medic boxes. If this request is authorized, staff will work with our Fire Department to order the chassis and start ordering materials to refurbish the medic boxes. The lead time for the equipment is approximately one year. Once the equipment is secured, Frazer Ambulance Company will transport the units to Houston, TX to begin the refurbishment process. While the units are out of service, the Fire Department will utilize their backup Medic units to supplement their current level of service.

Legal Review:

This report has been reviewed by the City Attorney’s office.

Strategic Plan:

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City of Palm Desert
(Authorize the Remount of two ALS Paramedic Units)

Page 2 of 2 ends

Public Safety and Emergency Services section of the Palm Desert Strategic Plan, specifically under Priority 1: Enhance the Delivery of Public Safety Services. The priority's strategy is to expand the existing superlative services provided by the fire and police departments to address future growth and safety concerns. One of the action steps is to identify public safety needs including new equipment.

FINANCIAL IMPACT:

A total of $834,000 for Fire Services/Cap-Autos/Vehicles is included in the approved Capital Improvement Project (CIP) list of Fiscal Year 2023/24 under Account No. 5304220-4403000.

After a review of the equipment needed, Staff and fire services have determined an additional appropriation is necessary to cover all costs as follows:

FY 2023-24 Account # Budget Cost Balance
5304220-4403000
Ladder Truck 33 Equipment* $500,000 $0
Stryker Gurneys $126,000 $107,448.94
Ambulance/remounts (2)** $208,000 $551,410.64
10' Paramedic Squad Unit PY Order $0.00 $200,388.42
Total $834,000 $859,248.00
Required Appropriation ($25,248.00)
*Purchase postponed till 2024/25 where funds will be requested **Current request – Initially only one ambulance was budgeted for replacement/refurbishment in 2023/24 FY.

ATTACHMENTS:

1. Quote for Truck 233

2. Quote for Truck 271

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Customer Quote
10/31/2023 1:30:47 PM
Estimate No: Q3785-0001
Quote Date: 10/10/2023
Expiration Date: 12/15/2023
Salesperson: HB
Payment Terms: Net 30
Invoice To: 10216 Deliver To:

Matthew Kotz
City of Palm Desert
73510 Fred Waring Dr.

Palm Desert CA 92260
US
Matthew Kotz
City of Palm Desert
73510 Fred Waring Dr.

Palm Desert CA 92260
US
No. Item Qty U/M: Unit Price Net Amount
1 MODULE-EMS-X 1.00 EA $ 164,225.00 $ 164,225.00
Configurable EMS Module, Remount
2 CHASSIS 1.00 EA $ 70,250.00 $ 70,250.00
2024 Ford F-450 Gas 4x2 Super Cab
3 DELIVERY 2,850.00 M $ 4.00 $ 11,400.00
Flatbed Round Trip
5 TRADE-IN 1.00 EA $ 0.00 $ 0.00
Trade In Allowance
6 CONTINGENCY 1.00 EA $ 10,000.00 $ 10,000.00
Customer Contingency Fund
10 SpecDoc 1.00 EA $ 0.00 $ 0.00
Configurable item to create the SpecDoc
Frazer will accept returns on parts up to 180 days after shipment. No restocking fee will be charged if the item is returned within 90 days of the original invoice date. All parts returns should be shipped back freight prepaid and require prior approval with a “Returns Material Authorization” (RMA) clearly displayed on the exterior of the shipping package. A credit will be issued towards the customer's account within approximately 7 business days of receipt of the item. If a part is returned after 90 days of the original invoice date a 15% restocking fee will be applied. Frazer Ltd reserves the right to accept returned items at its sole discretion based upon the condition of the item to be placed back into stock. :

Prod
knewberry
Frazer, Ltd. Page 1 of 2

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Customer Quote
10/31/2023 1:30:47 PM
Estimate No: Q3785-0001
Quote Date: 10/10/2023
Expiration Date: 12/15/2023
Salesperson: HB
Payment Terms: Net 30
No. Item Qty U/M: Unit Price Net Amount
Remit To:

Frazer, Ltd.
7219 Rampart Street
Houston TX 77081
Sale Amount:

Order Disc( 0.0000%):

Surcharge:

Sales Tax:

Misc Charges:

Total Amount:
255,875.00

0.00 N/A
19,830.32

0.00 275,705.32
Frazer will accept returns on parts up to 180 days after shipment. No restocking fee will be charged if the item is returned within 90 days of the original invoice date. All parts returns should be shipped back freight prepaid and require prior approval with a “Returns Material Authorization” (RMA) clearly displayed on the exterior of the shipping package. A credit will be issued towards the customer's account within approximately 7 business days of receipt of the item. If a part is returned after 90 days of the original invoice date a 15% restocking fee will be applied. Frazer Ltd reserves the right to accept returned items at its sole discretion based upon the condition of the item to be placed back into stock. :

Prod
knewberry
Frazer, Ltd. Page 2 of 2

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Page 1 of 11 ends

For your convenience, all module pricing has been itemized below per quote Q3785-0001 for City of Palm Desert :

Base Module $ 28,125.00
Chassis Exterior $ 23,775.00
Module Exterior $ 82,725.00
Chassis Interior $ 9,400.00
Module Interior $ 20,200.00
Module Total $ 164,225.00
Items included in above totals:

1. Old Chassis: Make Driveable $ incl

2. Type I 12' Module $ incl

3. This is a CAAS GVS v3.0 Unit $ incl
Chassis Exterior:

4. Chassis Paint Layout: Keep Factory Paint Color - Red $ incl

5. Chassis : 2024 Ford F-450, Gas, 4x2, Super Cab, 84" Cab to Axle, PQ - Race Red $ incl

6. Suspension: LiquidSpring $ 15,550.00

7. Wheel type: Factory Aluminum $ incl

8. Dual Dynamics Valve Stem Extender with Equalization and Pressure Indicator $ 375.00

9. Road Force Elite tire and wheel balancing $ incl

10. Chassis Steps: ArcRite with Sure Grip $ 1,350.00

11. Grille Guard: Grille Guard with Wraparounds $ incl

12. 10" and 12" Air Horns $ 1,450.00

13. Compressor Type: Standard $ 850.00

14. Air Horn Switching Options: Momentary $ 125.00

15. Siren Amplifier: Howler $ 1,700.00

16. New Module Disconnect Switch $ 850.00

17. Window Tint (35% VLT) on Chassis Doors $ 375.00

18. Passenger's side Grille Light: Whelen M4 Red Light $ incl

19. Driver's side Grille Light: Whelen M4 Red Light $ incl

20. Passenger's side Intersect Light: Whelen M4 Red Light $ incl

21. Driver's side Intersect Light: Whelen M4 Red Light $ incl

22. Driver Fender Light: Whelen M4 Clear/Red Light $ 450.00

23. Passenger Fender Light: Whelen M4 Clear/Red Light $ 450.00

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Page 2 of 11 ends

24. UNOC #925 - Furnish and install (1) extra Whelen M4 Red steady burn LED on the grille guard (ON with PRIMARY)
$ 250.00
Chassis Exterior Subtotal $ 23,775.00
Module Exterior:

25. New Power Source: MEPS $ 18,950.00

26. New Corner Trim $ incl

27. New Corner Caps $ incl

28. 20 hour(s) of Body Work $ 2,500.00

29. Module Paint Layout: Non-White One Tone - PQ - Race Red $ 21,900.00

30. Remove Conspicuity on Rear Wall $ 850.00

31. Rear Wall 3M Conspicuity Layout - Chevron : Fluorescent Yellow/Green Base Color and Red - Translucent Overlay
$ 2,025.00

32. Entry Door Conspicuity Layout - Squares : White Base Color $ 450.00

33. Compartment Conspicuity Layout - Strips : White Base Color $ 250.00

34. Frazer Provided Graphics $ 3,500.00

35. Dri-Deck in Applicable Exterior Compartments $ 375.00

36. Existing GTT Opticom $ incl

37. Opticom Switching: On with Primary and Cut-off with park $ incl

38. Shore Power: Single 30 Amp $ 1,050.00

39. Pigtail/Plug Option: Pigtail $ incl

40. Reconnect Ignition Kill Switch $ 175.00

41. Front Wall Light Layout: Lower 5 Lights $ incl

42. Front Wall Light #1: Whelen M6 Red Light $ 275.00

43. Front Wall Light #2: Whelen M6 Red Light $ 275.00

44. Front Wall Light #3: Whelen M6 Clear Light $ 275.00

45. Front Wall Light #4: Whelen M6 Red Light $ 275.00

46. Front Wall Light #5: Whelen M6 Red Light $ 275.00

47. Front Wall Driver Side Box Light: Whelen M6 Red Light $ 275.00

48. Front Wall Passenger Box Light: Whelen M6 Red Light $ 275.00

49. UNOC #1040 - Furnish and install extra piece of treadbrite on the driver's side wall, level with the top of the wheel well treadbrite, between the rear storage compartment insert and the rear trim piece
$ 75.00

50. UNOC 2571 Furnish and install 46" Black FireTech HiViz brow light (P/N FT-B-46-B) $ $ 2,850.00

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on front wall of module in HIGH position, wired to console switch position <#>

51. Driver Wall Front Box Light: Whelen M6 Red Light $ 275.00

52. Driver Wall Rear Box Light: Whelen M6 Red Light $ 275.00

53. Driver Wheel Well Light: Whelen M6 Clear/Red Light $ 300.00

54. Converter Flanges For Wheel Well Lights $ 200.00

55. Side Scene Lights: Frazer Standard Whelen M9 Chrome Housing $ 2,050.00

56. New 2 high D Cylinder Holder $ 250.00

57. New O2 Rollers for an H Cylinder $ 775.00

58. O2 Regulator - Ship Loose $ 250.00

59. New Battery Charger $ 550.00

60. Compartment Light in the Electrical Compartment $ 375.00

61. New Dometic A/C with Exhaust Fan $ 8,000.00

62. All Cladding/Treadbrite: New $ 1,225.00

63. Driver Side Blind Spot Camera $ 750.00

64. UNOC Reconfigure driver's side rear storage compartment:

Flat bars in the back corners. remove and reinstall existing SCBA Brackets on the flat bars.
$ 1,000.00

65. UNOC1045 Furnish and install coat hooks in rear storage compartment in following locations:
- (1) double coat hook on front wall, centered between SCBA flat bar and compartment opening
- (1) double coat hook on rear wall, centered between SCBA bracket and compartment opening
- (2) double coat hooks on rear storage compartment door $ 250.00

66. UNOC 1047 Furnish and install stainless steel threshold on rear storage compartment insert
$ 100.00

67. UNOC #1040 - Furnish and install extra piece of treadbrite on the driver's side wall, level with the top of the wheel well treadbrite, between the rear storage compartment insert and the rear trim piece
$ 75.00

68. UNOC Furnish and Install stainless steel threshold on O2 Compartment threshold. $ 75.00

69. Module Window Option: Sliding Window $ incl

70. Upper Rear Wall Light Layout: 3 Across $ incl

71. Upper Light #1: Whelen M6 Load Light $ 450.00

72. Upper Light #2: Whelen M6 Amber Light $ 275.00

73. Upper Light #3: Whelen M6 Load Light $ 450.00

74. Lower Light #1: Whelen M6 Brake/Tail/Turn Red Light $ 225.00

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75. Lower Light #2: Whelen M6 Brake/Tail/Turn Red Light $ 225.00

76. Lower Light #3: Whelen M6 Amber Light $ 275.00

77. Lower Light #4: Whelen M6 Amber Light $ 275.00

78. Rear Wall Driver Box Light: Whelen M6 Red Light $ 275.00

79. Rear Wall Passenger Box Light: Whelen M6 Red Light $ 275.00

80. Converter Flanges For Box Lights $ 800.00

81. Converter Flanges For Emergency Lights $ 1,200.00

82. Compartment Light in the Rear Backboard Compartment $ 375.00

83. Lower BTTs: 2 Grote Lights on each side $ incl

84. New Rear Bumper $ 950.00

85. New Door Grabbers $ incl

86. New Cast License Plate Light $ incl

87. UNOC 2841 Furnish and install (2) Whelen M6 back-up lights and (2) Whelen M6 BTT lights, in lieu of Grote lights on the treadbrite
$ 850.00

88. Passenger Wall Front Box Light: Whelen M6 Red Light $ 275.00

89. Passenger Wall Rear Box Light: Whelen M6 Red Light $ 275.00

90. Passenger Wheel Well Light: Whelen M6 Clear/Red Light $ 300.00

91. Replace Gas Hold-Open at Side Entry $ incl

92. Compartment Light in the Front I/O Compartment $ 375.00

93. Passenger Side Blind Spot Camera $ 750.00

94. UNOC 1376 Furnish and install stainless steel threshold on bottom of front I/O compartment door insert
$ 100.00

95. UNOC 1048 Furnish and install stainless steel threshold on bottom of side entry door insert
$ 100.00
Module Exterior Subtotal $ 82,725.00
Chassis Interior:

96. Siren Speakers: Whelen SA 315 Speakers $ incl

97. Tap-2 on Primary Siren $ incl

98. Siren Option: Whelen C9 Siren in Console $ incl

99. Mic 1 on passenger's side slot 1 $ incl
100. HAAS Alert System: HAAS Alert Responder to Vehicle - 3 Year Sub $ incl 101. Slot 1: Extended MDT plate - no swivel, no fuel gauge $ 125.00 102. Slot 2: Single Slot Switch Panel $ incl

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103. Slot 3: Radio Plate: 7.5 L X 2.5 W opening dims $ incl 104. Slot 4: Siren 1 $ incl
105. Slot 5: Single Blank $ incl
106. Slot 6: Single Blank $ incl
107. COMP OPEN / DOOR OPEN Warning Buzzer $ 325.00
108. COMP OPEN / DOOR OPEN Amber Warning Light on Top driver side corner of the console
$ 475.00
109. Kussmaul USB/USB-C at Console $ 300.00
110. Console Switch Layout : Primary - Secondary - Howler - Air Horn - Side Scene (Driver's Side) - Side Scene (Passenger's Side) - Rear Load - Interior Lights - Kussmaul USB/USB-C -
$ incl
111. New Armrest $ 300.00
112. Console Layout: 6-Slot Console $ incl
113. Floor in Front of Console: (2) Survivor Flashlights wired Failsafe $ 900.00 114. Rear of Console: Double Mapholder $ 500.00
115. Camera System: Voyager 7" Monitor with Back-Up Camera $ 2,175.00 116. Voyager Monitor Behind Overhead Console on Headliner $ incl 117. Black Back-up Camera $ incl
118. Secure-Idle Anti-Theft System $ 850.00
119. UNOC #518 - Furnish and install Federal Signal EQ2B with control head in console slot 5; no additional switches; wired to (2) additional Whelen 315P speakers $ 3,450.00
Chassis Interior Subtotal $ 9,400.00
Module Interior:
120. New Lexan for Front Wall and Action Wall Cabinets $ 1,150.00 121. New Desert Rose Red Interior Trim $ 500.00
122. Stainless Steel Side and Rear Entry Door Grab Rails (price covered under new Module Paint)
$ incl
123. Powder Coated Plate on Front Wall in Front I/O $ 175.00 124. New Stainless Steel Countertops $ 1,050.00
125. New Action Wall with SSCOR Suction $ 1,500.00
126. Location 1: 4 Switch w/Thermostat $ incl
127. Location 2: Existing Double O2 Outlet $ incl
128. Location 3: Electric O2 panel with monitor $ 2,300.00

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129. Location 4: Dual USB receptacles $ 300.00
130. Location 6: Blank $ incl
131. Location 7: Blank $ incl
132. Location 8: Quad 120 VAC $ incl
133. Location 9: Suction $ incl
134. Action Wall Switch Layout : Interior Lights; Front Interior Light; Ventilation Fan; Electric O2;
$ incl
135. Acrylic Holder at the Action Wall Cabinet $ 375.00 136. Acrylic Holder Aft CPR Seat $ 500.00
137. Rear Door Switch Layout : Blank; Blank; Dump/Bypass (Suspension); Existing Rear Load;
$ incl
138. Frazer cushions at the Squad Bench $ incl
139. Harness Type for Seat Position 1: No Harness $ incl 140. 22 Pocket Acrylic Holder $ 850.00
141. New Glove Box & Handrail at the Head of the Squad Bench $ 450.00 142. In-Module Camera at the Rear Headknocker Position $ 775.00 143. Stryker cot tower only ( no antler and bar ) $ incl 144. Floor Options: Customer Provided Stryker Power-LOAD - Gen 2 $ 2,225.00 145. New Lonplate II Gunmetal Floor $ 4,500.00
146. New Laydown O2 $ 550.00
147. Captain's Chair Type: Captain's Chair with Child Safety Seat and 4pt. Harness $ 2,675.00 148. Customer Provided Items Processing Fee $ 325.00
Module Interior Subtotal $ 20,200.00

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Email this quote along with your PO
to Herbert Brady at [email protected]
Remit To:

Frazer, LTD
7219 Rampart St.

Houston, Texas 77081
USA
Standard Terms and Conditions
INVOICING AND PAYMENT TERMS: Vendor shall submit one (1) original invoice per payment due. The invoice(s) shall include the items listed in accordance with the quote mentioned in the Sale Agreement with reference to the Customer’s Purchase Order Number.

If the Sale Agreement provides for any progress (or advance) payments based on specific milestones or activities, Vendor’s invoice shall certify to the accomplishment or performance by Vendor of said milestone or activity, and that Customer has obtained a security interest in such Products to the extent of such payment.

Payment shall be due upon receipt of the invoice and delivery of the unit to the Customer unless previously negotiated.

CANCELLATION POLICY: Cancellation of orders must be received 120 days prior to the agreed upon delivery date. If the order is cancelled within the 120 day window, a fee of 25% of the total purchase order price will apply.

DELIVERY TERMS: The products listed in the estimate are to be delivered Free On Board (FOB) Destination to Houston,TX. Customer representative(s) will pick up the unit at upfitter location, 7219 Rampart St., Houston, TX 77081 and transport it to their final destination at customer expense unless otherwise specified in the Vendor quote.

TERMINATION FOR CAUSE: Customer may terminate this Sale Agreement and any corresponding Purchase Order, or any part thereof, for cause including, but not limited to the following Vendor actions: (1)

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any default or breach of any of the terms and conditions of the Sale Agreement, (2) failure to provide Customer, upon request, a reasonable assurance of future performance, or (3) bankruptcy, dissolution, or suspension of payments by judicial decree. If Vendor does not cure such failure within a period of five (5) days or such a longer period as Customer may authorize in writing after the date such notice is sent to Vendor, then termination may proceed.

Vendor may also terminate this Sale Agreement and any corresponding Purchase Order for cause, and Vendor will not be in breach of same, in the event any supplier to Vendor fails to deliver Products and/or component parts in a timely fashion and Vendor cannot make alternate accommodations in order to comply with the Parties’ agreed upon completion and delivery dates.

CHANGE ORDERS: Vendor has the right to modify the Purchase Order requirements and conditions as needed and will advise Customer in writing of such requested changes. Vendor shall not proceed with any changes without Customer’s written authorization. Any request by Customer to change the terms or conditions of the Purchase Order, including product specifications, options, and price, must be made in advance of the production job order release. Any changes made after the release of the production job order will incur a $350 fee per change order made in a 24 hour period and will be included on a secondary invoice. Vendor reserves the right to refuse changes requested by the Customer.

PROPRIETARY INFORMATION, CONFIDENTIALITY AND ADVERTISING: All commercial, financial or technical information in any form that Vendor provides to Customer shall be deemed proprietary and confidential and Customer shall not disclose such information to third parties without Vendor’s written consent. Termination of the Sale Agreement shall not relieve Customer of this confidentiality obligation. Upon Vendor’s request, Customer shall return all confidential information to Vendor along with any reproductions, in whole or in part. The confidentiality obligation does not apply to information that is in the public domain through no fault of Customer or to information lawfully within Customer’s possession prior to the date of the Purchase Order, as evidenced by Customer’s written records.

INDEMNIFICATION: Customer shall fully release, indemnify, defend and hold harmless Vendor, its coventurers, its contractors, and their respective affiliates, and Vendor’s and their respective directors, officers and employees (including agency personnel) (“Vendor Group”) from and against any and all claims arising out of the Customer’s purchase, use, sale or incorporation of any Products purchased from Vendor into Customer’s products or equipment wherein it is claimed or alleged that Vendor’s Products are defective or violate any warranty, standard of care, industry standard or governmental regulation or term or condition of any Purchase Order without regard to any allegation of negligence on the part of the Vendor Group as it pertains to Vendor’s Products.

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Vendor shall fully release, indemnify, defend and hold harmless Customer, its co-venturers, its contractors, and their respective affiliates, and the Customer’s and their respective directors, officers and employees (including agency personnel) (“Customer Group”) from and against any and all claims arising out of the Customer’s purchase, use, sale or incorporation of any Products purchased from Vendor into Customer’s products or equipment wherein it is claimed or alleged that Vendor’s Products are defective or violate any warranty, standard of care, industry standard or governmental regulation or term or condition of any Purchase Order without regard to any allegation of negligence on the part of the Customer Group as it pertains to Vendor’s Products.

Customer Initials: _________
LIMITATIONS ON DAMAGES: In the event of any dispute, disagreement or breach alleged by Customer on the part of Vendor, Customer’s exclusive and sole remedy shall be repair or replacement, if practical, of the module, or component part, by Vendor. If Vendor is not able to effectuate a repair, replacement, or cure that brings the module, or component part, into compliance with the Parties’ agreement, then Vendor shall refund the sale price to Customer. In no event shall Vendor be liable to Customer, or to any third-party acting through Customer, for any additional, consequential or punitive damages, or damages for lost sales, revenue or profits claimed by Customer or any third-party acting through Customer.

FORCE MAJEURE: A force majeure delay shall mean any delay or other unforeseeable causes beyond the reasonable control of the party affected, provided that any such delay is not caused, in whole or in part, by the acts or omissions of the party so delayed and further provided that such party is unable to make up for such delay with reasonable diligence and speed. If any such cause delays Vendor’s performance, the delivery date or time for completion may be extended by a period of time reasonably necessary to overcome the effect of such delay; however, Vendor shall take all reasonable measures to mitigate the effects of the force majeure event and to minimize such delay. A party affected by a force majeure event shall notify the other party of such force majeure event within forty-eight (48) hours of its knowledge of such event for the event to be considered a bona fide force majeure event.

TITLE AND RISK OF LOSS: Title to the Products shall transfer to Customer upon receipt of Products by Customer or its agent unless otherwise stated in the Sale Agreement. Notwithstanding the above, risk of loss of the Products shall remain with Vendor until delivered to Customer.

WAIVER: Vendor’s failure to exercise or enforce any right in the Purchase Order, or any other right or privilege under law, or Vendor’s waiver of any breach by Customer shall not constitute a waiver or

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modification of any terms, conditions, privileges or rights whether of the same or similar type, unless Vendor gives such waiver in writing.

LIENS: Vendor waives and relinquishes all existing and future liens and claims (statutory or otherwise) for the Products specified in the Purchase Order, and warrants that the Products will be free and clear of all liens, claims or encumbrances of any kind.

INSPECTION, REVIEW AND WITNESSING: Customer and/or the ultimate owner of the Products have the right to inspect and attend testing of the Products at Vendor’s premises (or its supplier’s or subcontractor’s premises) with reasonable advance notice. If any inspection is made on the premises of Vendor or its supplier, Vendor, without additional charge, shall provide all reasonable facilities and assistance for the safety and convenience of the inspectors in the performance of their duties.

APPLICABLE LAW AND VENUE: The Sale Agreement shall be governed and interpreted in accordance with the laws of the State of Texas, without reference to any principle of conflict of laws. Customer and Vendor expressly exclude the application of the Convention on International Sale of Goods to the Sale Agreement.

Venue for all judicial, administrative, or regulatory proceedings shall be Houston, Harris County, Texas.

OWNERSHIP OF DOCUMENTS: Title to all drawings, specifications, calculations, technical data and other documents that Customer submits in accordance with the Purchase Order shall vest with Vendor. Vendor shall have the right to use such documents for any purpose pertaining to the manufacture, assembly, and delivery of the Products.

Title to all drawings, specifications, calculations, technical data, and other documents that Vendor submits to the Customer shall vest with the Customer. Customer shall have the right to use such documents for any purpose pertaining to the installation, operation, and maintenance of the Products.

INSURANCE: Vendor shall comply with the project insurance requirements for which the Products are being provided. Customer shall provide specific reasonable levels required as soon as such levels are available, which shall not exceed $1,000,000 for any non-statutory category other than excess liability umbrella, which shall not exceed $4,000,000. When requested by Customer, Vendor shall provide certificates of insurance as proof of same.

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SURVIVAL: The provisions of the following Paragraphs of these Terms and Conditions shall survive any cancellation or termination of the Purchase Order: (Proprietary Information, Confidentiality and Advertising), (Indemnification), (Liens), and (Applicable Law and Venue).

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Customer Quote
10/31/2023 10:53:48 AM
Estimate No: Q3829-0001
Quote Date: 10/12/2023
Expiration Date: 12/15/2023
Salesperson: HB
Payment Terms: Net 30
Invoice To: 10216 Deliver To:

Matthew Kotz
City of Palm Desert
73510 Fred Waring Dr.

Palm Desert CA 92260
US
Matthew Kotz
City of Palm Desert
73510 Fred Waring Dr.

Palm Desert CA 92260
US
No. Item Qty U/M: Unit Price Net Amount
1 MODULE-EMS-X 1.00 EA $ 164,225.00 $ 164,225.00
Configurable EMS Module, Remount
2 CHASSIS 1.00 EA $ 70,250.00 $ 70,250.00
2024 Ford F-450 Gas 4x2 Super Cab
3 DELIVERY 2,850.00 M $ 4.00 $ 11,400.00
Flatbed Round Trip
5 TRADE-IN 1.00 EA $ 0.00 $ 0.00
Trade In Allowance
6 CONTINGENCY 1.00 EA $ 10,000.00 $ 10,000.00
Customer Contingency Fund
7 SpecDoc 1.00 EA $ 0.00 $ 0.00
Configurable item to create the SpecDoc
Frazer will accept returns on parts up to 180 days after shipment. No restocking fee will be charged if the item is returned within 90 days of the original invoice date. All parts returns should be shipped back freight prepaid and require prior approval with a “Returns Material Authorization” (RMA) clearly displayed on the exterior of the shipping package. A credit will be issued towards the customer's account within approximately 7 business days of receipt of the item. If a part is returned after 90 days of the original invoice date a 15% restocking fee will be applied. Frazer Ltd reserves the right to accept returned items at its sole discretion based upon the condition of the item to be placed back into stock. :

Prod
knewberry
Frazer, Ltd. Page 1 of 2

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Customer Quote
10/31/2023 10:53:48 AM
Estimate No: Q3829-0001
Quote Date: 10/12/2023
Expiration Date: 12/15/2023
Salesperson: HB
Payment Terms: Net 30
No. Item Qty U/M: Unit Price Net Amount
Remit To:

Frazer, Ltd.
7219 Rampart Street
Houston TX 77081
Sale Amount:

Order Disc( 0.0000%):

Surcharge:

Sales Tax:

Misc Charges:

Total Amount:
255,875.00

0.00 N/A
19,830.32

Prod
knewberry
Frazer, Ltd. Page 2 of 2

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For your convenience, all module pricing has been itemized below per quote Q3829-0001 for City of Palm Desert :

Base Module $ 28,125.00
Chassis Exterior $ 23,775.00
Module Exterior $ 82,725.00
Chassis Interior $ 9,400.00
Module Interior $ 20,200.00
Module Total $ 164,225.00
Items included in above totals:

1. Old Chassis: Make Driveable $ incl

2. Type I 12' Module $ incl

3. This is a CAAS GVS v3.0 Unit $ incl
Chassis Exterior:

4. Chassis Paint Layout: Keep Factory Paint Color - Red $ incl

5. Chassis : 2024 Ford F-450, Gas, 4x2, Super Cab, 84" Cab to Axle, PQ - Race Red $ incl

6. Suspension: LiquidSpring $ 15,550.00

7. Wheel type: Factory Aluminum $ incl

8. Dual Dynamics Valve Stem Extender with Equalization and Pressure Indicator $ 375.00

9. Road Force Elite tire and wheel balancing $ incl

10. Chassis Steps: ArcRite with Sure Grip $ 1,350.00

11. Grille Guard: Grille Guard with Wraparounds $ incl

12. 10" and 12" Air Horns $ 1,450.00

13. Compressor Type: Standard $ 850.00

14. Air Horn Switching Options: Momentary $ 125.00

15. Siren Amplifier: Howler $ 1,700.00

16. New Module Disconnect Switch $ 850.00

17. Window Tint (35% VLT) on Chassis Doors $ 375.00

18. Passenger's side Grille Light: Whelen M4 Red Light $ incl

19. Driver's side Grille Light: Whelen M4 Red Light $ incl

20. Passenger's side Intersect Light: Whelen M4 Red Light $ incl

21. Driver's side Intersect Light: Whelen M4 Red Light $ incl

22. Driver Fender Light: Whelen M4 Clear/Red Light $ 450.00

23. Passenger Fender Light: Whelen M4 Clear/Red Light $ 450.00

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24. UNOC #925 - Furnish and install (1) extra Whelen M4 Red steady burn LED on the grille guard (ON with PRIMARY)
$ 250.00
Chassis Exterior Subtotal $ 23,775.00
Module Exterior:

25. New Power Source: MEPS $ 18,950.00

26. New Corner Trim $ incl

27. New Corner Caps $ incl

28. 20 hour(s) of Body Work $ 2,500.00

29. Module Paint Layout: Non-White One Tone - PQ - Race Red $ 21,900.00

30. Remove Conspicuity on Rear Wall $ 850.00

31. Rear Wall 3M Conspicuity Layout - Chevron : Fluorescent Yellow/Green Base Color and Red - Translucent Overlay
$ 2,025.00

32. Entry Door Conspicuity Layout - Squares : White Base Color $ 450.00

33. Compartment Conspicuity Layout - Strips : White Base Color $ 250.00

34. Frazer Provided Graphics $ 3,500.00

35. Dri-Deck in Applicable Exterior Compartments $ 375.00

36. Existing GTT Opticom $ incl

37. Opticom Switching: On with Primary and Cut-off with park $ incl

38. Shore Power: Single 30 Amp $ 1,050.00

39. Pigtail/Plug Option: Pigtail $ incl

40. Reconnect Ignition Kill Switch $ 175.00

41. Front Wall Light Layout: Lower 5 Lights $ incl

42. Front Wall Light #1: Whelen M6 Red Light $ 275.00

43. Front Wall Light #2: Whelen M6 Red Light $ 275.00

44. Front Wall Light #3: Whelen M6 Clear Light $ 275.00

45. Front Wall Light #4: Whelen M6 Red Light $ 275.00

46. Front Wall Light #5: Whelen M6 Red Light $ 275.00

47. Front Wall Driver Side Box Light: Whelen M6 Red Light $ 275.00

48. Front Wall Passenger Box Light: Whelen M6 Red Light $ 275.00

50. UNOC 2571 Furnish and install 46" Black FireTech HiViz brow light (P/N FT-B-46-B) $ $ 2,850.00

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on front wall of module in HIGH position, wired to console switch position <#>

51. Driver Wall Front Box Light: Whelen M6 Red Light $ 275.00

52. Driver Wall Rear Box Light: Whelen M6 Red Light $ 275.00

53. Driver Wheel Well Light: Whelen M6 Clear/Red Light $ 300.00

54. Converter Flanges For Wheel Well Lights $ 200.00

55. Side Scene Lights: Frazer Standard Whelen M9 Chrome Housing $ 2,050.00

56. New 2 high D Cylinder Holder $ 250.00

57. New O2 Rollers for an H Cylinder $ 775.00

58. O2 Regulator - Ship Loose $ 250.00

59. New Battery Charger $ 550.00

60. Compartment Light in the Electrical Compartment $ 375.00

61. New Dometic A/C with Exhaust Fan $ 8,000.00

62. All Cladding/Treadbrite: New $ 1,225.00

63. Driver Side Blind Spot Camera $ 750.00

64. UNOC Reconfigure driver's side rear storage compartment:

Flat bars in the back corners. remove and reinstall existing SCBA Brackets on the flat bars.
$ 1,000.00

66. UNOC 1047 Furnish and install stainless steel threshold on rear storage compartment insert
$ 100.00

68. UNOC Furnish and Install stainless steel threshold on O2 Compartment threshold. $ 75.00

69. Module Window Option: Sliding Window $ incl

70. Upper Rear Wall Light Layout: 3 Across $ incl

71. Upper Light #1: Whelen M6 Load Light $ 450.00

72. Upper Light #2: Whelen M6 Amber Light $ 275.00

73. Upper Light #3: Whelen M6 Load Light $ 450.00

74. Lower Light #1: Whelen M6 Brake/Tail/Turn Red Light $ 225.00

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75. Lower Light #2: Whelen M6 Brake/Tail/Turn Red Light $ 225.00

76. Lower Light #3: Whelen M6 Amber Light $ 275.00

77. Lower Light #4: Whelen M6 Amber Light $ 275.00

78. Rear Wall Driver Box Light: Whelen M6 Red Light $ 275.00

79. Rear Wall Passenger Box Light: Whelen M6 Red Light $ 275.00

80. Converter Flanges For Box Lights $ 800.00

81. Converter Flanges For Emergency Lights $ 1,200.00

82. Compartment Light in the Rear Backboard Compartment $ 375.00

83. Lower BTTs: 2 Grote Lights on each side $ incl

84. New Rear Bumper $ 950.00

85. New Door Grabbers $ incl

86. New Cast License Plate Light $ incl

87. UNOC 2841 Furnish and install (2) Whelen M6 back-up lights and (2) Whelen M6 BTT lights, in lieu of Grote lights on the treadbrite
$ 850.00

88. Passenger Wall Front Box Light: Whelen M6 Red Light $ 275.00

89. Passenger Wall Rear Box Light: Whelen M6 Red Light $ 275.00

90. Passenger Wheel Well Light: Whelen M6 Clear/Red Light $ 300.00

91. Replace Gas Hold-Open at Side Entry $ incl

92. Compartment Light in the Front I/O Compartment $ 375.00

93. Passenger Side Blind Spot Camera $ 750.00

94. UNOC 1376 Furnish and install stainless steel threshold on bottom of front I/O compartment door insert
$ 100.00

95. UNOC 1048 Furnish and install stainless steel threshold on bottom of side entry door insert
$ 100.00
Module Exterior Subtotal $ 82,725.00
Chassis Interior:

96. Siren Speakers: Whelen SA 315 Speakers $ incl

97. Tap-2 on Primary Siren $ incl

98. Siren Option: Whelen C9 Siren in Console $ incl

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Email this quote along with your PO
to Herbert Brady at [email protected]
Remit To:

Frazer, LTD
7219 Rampart St.

Payment shall be due upon receipt of the invoice and delivery of the unit to the Customer unless previously negotiated.

TERMINATION FOR CAUSE: Customer may terminate this Sale Agreement and any corresponding Purchase Order, or any part thereof, for cause including, but not limited to the following Vendor actions: (1)

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modification of any terms, conditions, privileges or rights whether of the same or similar type, unless Vendor gives such waiver in writing.

Venue for all judicial, administrative, or regulatory proceedings shall be Houston, Harris County, Texas.

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CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: December 14, 2023
PREPARED BY: Deborah Glickman, Management Analyst
REQUEST: APPROVE A LICENSE AGREEMENT BETWEEN THE CITY OF PALM

DESERT AND DESERT WAVE VENTURES FOR USE OF A PORTION OF ASSESSOR’S PARCEL NUMBERS 620-450-002, 620-370-003, 620-370- 004, 620-370-020, 620-370-033, AND A PORTION OF 620-370-043 RECOMMENDATION:

1. Approve a License Agreement between the City of Palm Desert and Desert Wave Ventures (DWV) for the use of Accessor’s Parcel Nos. (APNs) 620-370-002, 620-370-003, 620-370- 004, 620-370-020, 620-370-033, and a portion of 620-370-043.

2. Authorize City Attorney to make non-monetary changes to the License Agreement.

3. Authorize City Manager to execute any and all documents related to the License Agreement.

BACKGROUND/ANALYSIS:

In December 2022, DWV acquired parcels adjacent to the Desert Willow Golf Resort for the future development of DSRT Surf; a 5.5-acre surf lagoon, surf center, and villlas. Construction of the surf lagoon is set to begin in January 2024, and DWV anticipates pre-construction activity to begin in December 2023. In order to provide construction parking, construction trailers, and material staging nearby to the DSRT Surf construction site, DWV has requested to license APNs 620-370-002, 620-370-003, 620-370-004, 620-370-020, 620-370-033, and a portion of 620-370- 043 (see attached) from the City from December 2023 through December 31, 2025. If approved, vehicles will enter the site from Marketplace Drive, and the developer will provide chain link fencing and security cameras around the area.

In order to do so, DWV must enter into a License Agreement with the City. The City may charge a fee for use of the site. Since this is a temporary use intended to support a new development in the immediate area, staff is recommending a lease rate of $1 per year. This rate is consistent with previous leases between the City and the JW Marriott for use of the same property.

Since the City is currently in the negotiation phase of the Surplus Land Act requirements to sell the parcel, the License Agreement includes a thirty (30) day cancellation provision that will allow the City to terminate the License Agreement with DWV if the City enters into an agreement to sell the property to a prospective buyer prior to December 31, 2025.

Legal Review:

This report has been reviewed by Robert Messinger, BW&S Law, special counsel to the City and the City Attorney’s office.

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City of Palm Desert
City - License Agreement

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FINANCIAL IMPACT:

If the License Agreement is approved, the City will receive $1 per year.

ATTACHMENTS:

1. License Agreement

2. Site Utilization Plan

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LICENSE AGREEMENT

BETWEEN

THE CITY OF PALM DESERT
AND

DESERT WAVE VENTURES, LLC,
(FOR TEMPORARY STORAGE OF CONSTRUCTION EQUIPMENT AND MATERIALS) This LICENSE AGREEMENT (“Agreement”) is made and entered into as of December ___, 2023, by and between the City of Palm Desert, a California charter city (“City”), and Desert Wave Ventures, LLC, a Delaware limited liability company (“Licensee”). City and Licensee are sometimes individually referred to as a “Party” and collectively as the “Parties.” All references to City include its elected officials, officers, directors, employees, agents, and volunteers. All references to Licensee include its personnel, employees, agents, and subcontractors.

RECITALS
WHEREAS, the City is the owner of land designated as APN ___-___-___ and APN ___-___-___ located in the City of Palm Desert, County of Riverside, State of California (“Property”), as described in Exhibit “A” attached hereto and incorporated herein by this reference, and depicted in Exhibit “B” attached hereto and incorporated herein by this reference; and
WHEREAS, Licensee wishes to seek approval from City to utilize the City’s Property for the temporary storage of construction equipment and materials; and WHEREAS, City is amenable to permit Licensee to utilize the City’s Property for said purposes subject to the terms and conditions of this Agreement.

NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto agree as follows:

1. GRANT OF LICENSE. City does hereby grant to Licensee, and Licensee does hereby accept from City, a nonexclusive license to use the City Property for the purpose of storing construction materials and equipment to be used for the development and construction of a surf lagoon, surf center, and residential units project, as described in that certain First Amendment to Second Revised and Restated Disposition and Development Agreement, dated May 25, 2023 (the “DDA”), by and between the City and Licensee.

2. COMPENSATION. In consideration of the City entering into this Agreement, within three (3) business days of the full execution of this Agreement, Licensee shall pay to City the sum of _______________ Dollars ($________). In the event of any extension of this Agreement, within three (3) business days of the effective date of such extension, Licensee shall pay to City the sum of _______________ Dollars ($________).

3. TERM. This Agreement shall expire on December __, 2025, unless earlier terminated pursuant to Section 4, hereof.

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2 4. TERMINATION WITHOUT CAUSE: City in its sole and absolute discretion may terminate this Agreement at any time without cause by notifying the Licensee in writing at least thirty (30) days prior to the termination date.

5. AS-IS CONDITION AND ASSUMPTION OF RISK. Licensee accepts the condition of the Property in an as-is condition and acknowledges that: (i) City is under no obligation to provide any preparations or improvements to the Property prior to use by Licensee, (ii) Licensee’s use of the Property is entirely at its own risk, and (iii) City is actively marketing the Property for sale and Licensee may be compelled to vacate the Property upon such sale.

6. RELEASE AND WAIVER. Licensee waives and releases City and its officers, employees and agents from any and all liability to Licensee, its officers, employees or agents for any loss, damage, liability, or liability for damages, whether for loss of or damage to property, or injury to or death of persons, which may arise out of use of the Property by Licensee, its officers, employees or agents, except such loss or damage as is caused by or arises out of the gross negligence or willful misconduct of City, its officers, employees or agents. The foregoing shall include any loss, damage, claim, or liability for damages or injury caused by or resulting from Licensee’s introduction or generation of Hazardous Materials, as defined in Exhibit C, on the Property, or the creation of increased hazard to the public from existing and construction materials or equipment arising from the use of the Property by Licensee, its officers, employees, agents or contractors. However, Licensee shall not be responsible for any cleanup of Hazardous Materials not caused, generated or disturbed by Licensee, its officers, employees, agents or contractors.

7. INDEMNIFICATION. Licensee shall indemnify, protect, defend and hold harmless City, and its elected and appointed officials, officers, agents and employees (collectively, the "Indemnified Parties"), from and against any and all claims, actions, liabilities, damages, losses, judgments, costs and expenses (including reasonable attorneys' fees and costs), (collectively "Claims") which the Indemnified Parties, or any of them, may suffer or incur arising from Licensee's use of the City’s Property, and shall further indemnify, protect, defend and hold harmless the Indemnified Parties, and each of them, from and against any Claims arising from any negligence of Licensee, its agents, contractors, servants, employees, or licensees. The foregoing indemnity shall not extend to any Claims to the extent arising from the grossly negligent, willful or intentional acts or omissions of the Indemnified Parties, or any of them, as to all of which Claims City shall indemnify, protect, defend and hold harmless Licensee.

8. INSURANCE. During the term of this Agreement, Licensee shall have and maintain the same insurance requirements with respect to this Agreement as Licensee maintains pursuant to the DDA.

9. MAINTENANCE. At all times during the term of this Agreement, Licensee shall maintain the Property in a safe, clean, and orderly condition. Licensee agrees to take all prudent action to protect the Property from any damage or injury caused by the exercise of this License.

Licensee shall pay to City all costs incurred by City for the repair of such damage or injury.

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3 10. RESTORATION OF EASEMENT AREA. Upon termination of this Agreement, Licensee shall fully restore the Property to its original or better pre-existing condition.

11. SURVIVAL. The provisions of Sections 5, 6, 7, and 10 above shall survive the expiration of earlier termination of this Agreement.

12. NO INTEREST IN REAL PROPERTY. This Agreement does not grant Licensee, its successors, assigns or transferees any interest, legal or equitable, in the Property, and this Agreement shall become null and void and without legal effect if it is recorded in the official records of the County of Riverside.

13. SEVERABILITY. If any term, provision, covenant or condition of this License should be held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of this Agreement shall continue in full force and effect, and shall in no way be affected, impaired or invalidated thereby.

14. INTERPRETATION. The laws of the State of California shall govern the validity, construction and effect of this Agreement.

15. AMENDMENTS. No amendment to or modification of this Agreement shall be valid unless made in writing and approved by the City and Licensee. The parties agree that this requirement for written modifications cannot be waived and that any attempted waiver shall be void.

16. ENTIRE AGREEMENT. This License, including Exhibits "A", “B”, and “C”, is the entire, complete, final and exclusive expression of the parties with respect to the matters addressed therein and supersedes all other Agreements or understandings, whether oral or written, or entered into between City or Licensee prior to the execution of this License. No statements, representations or other agreements, whether oral or written, made by any party which are not embodied herein shall be valid and binding.

17. NOTICES. All notices hereunder must be in writing and shall be deemed validly given if sent by certified mail, return receipt requested, or by commercial courier, provided the courier’s regular business is delivery service and provided further that it guarantees delivery to the addressee by the end of the next business day following the courier’s receipt from the sender, addressed as follows (or any other address that the party to be notified may have designed to the sender by like notice):

TO CITY: City of Palm Desert
Attention: City Manager
73510 Fred Waring Dr.

Palm Desert, California 92260
With a copy to:

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4 City Attorney
City of Palm Desert
73510 Fred Waring Dr.

Palm Desert, California 92260
TO LICENSEE: Desert Wave Ventures, LLC
Attn: Don Rady
1555 Camino Del Mar, Suite 315C
Del Mar, CA 92014
With a copy to:

Don Rady
Value Real Estate
1919 Grand Ave
San Diego, CA 92109
With copy to:

Coast Law Group, LLP
1140 S. Coast Hwy 101
Encinitas, CA 92024
Attention: Marco Gonzalez
Notice shall be effective upon actual receipt or refusal as shown on the receipt obtained pursuant to the foregoing.

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5 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed the day and year first above written.

CITY:

Date: _____________, 2023
CITY OF PALM DESERT, a charter city
and municipal corporation
By:

KATHLEEN KELLY, Mayor
ATTEST:

By:________________________

ANTHONY MEJIA, MMC
City Clerk
APPROVED AS TO FORM:

By:________________________

ROBERT HARGREAVES
City Attorney

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6 Date: ___________2023
OWNER:

DESERT WAVE VENTURES, LLC, a
Delaware limited liability company
By: FS VENTURES, LLC, a Delaware
corporation, Its Manager
By:_________________________
Don Rady
Its: Managing Member
APPROVED AS TO FORM:

By:_____________________
Marco A. Gonzalez, Counsel

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7 CALIFORNIA ALL PURPOSE ACKNOWLEDGMENT
State of California )
) SS.

County of )
On , 20 , before me, , a Notary Public,
personally appeared ___________________ , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature _____________________________

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8 CALIFORNIA ALL PURPOSE ACKNOWLEDGMENT
State of California )
) SS.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature _____________________________

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EXHIBIT “A”
Property

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EXHIBIT B
Property Depiction

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EXHIBIT C
Definition of Hazardous Materials
For the purpose of this Agreement, “Hazardous Materials” shall mean any and all: (a) substances, products, by-products, waste, or other materials of any nature or kind whatsoever which is or becomes listed, regulated or addressed under any Environmental Laws; (b) materials, substances, products, by-products, waste, or other materials of any nature or kind whatsoever whose presence in and of itself or in combination with other materials, substances, products, byproducts, or waste may give rise to liability under any Environmental Law or any statutory or common law theory based on negligence, trespass, intentional tort, nuisance, strict or absolute liability or under any reported decisions of any state or federal court; and, (c) substances, products, by-products, wastes or other materials which may be hazardous or harmful to the air, water, soil, environment or affect industrial hygiene, occupational, health, safety and/or general welfare conditions, including without limitation, petroleum and/or asbestos materials, products, byproducts, or waste.

For the purposes of this Agreement, “Environmental Laws” shall mean and include all federal, state, and local laws, statutes, ordinances, regulations, resolutions, decrees, and/or rules now or hereinafter in effect, as may be amended from time to time, and all implementing regulations, directives, orders, guidelines, and federal or state court decisions, interpreting, relating to, regulating or imposing liability (including, but not limited to, response, removal, remediation and damage costs) or standards of conduct or performance relating to industrial hygiene, occupational, health, and/or safety conditions, environmental conditions, or exposure to, contamination by, or clean-up of, any and all Hazardous Materials, including without limitation, all federal or state super-lien or environmental cleanup.

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122,000 SF200,00 SF
December 2023 - December 2025
Construction Sub Contractor Parking
Primary Material Staging
Wave Machine Equipment Storage(will include
shade structure over equipment)
Chain Link Fence around area w/ Security Cameras
Entrance aligned with south lot entrance off of
Marketplace Drive
December 2023 - December 2025
Construction Trailers
GC Parking
Material Staging
Chain Link fence at perimeter with Security
Cameras
Entrance off Market Place Drive Owner:

John Luff
12250 Camino Real, Suite
315C
San Diego, CA 92130
(443)235-0803
[email protected]
Representative:

Ulrich Sauerbrey
74-948 Live Oak Street
Indian Wells, CA 92210
(760)610-9410
[email protected] 100,000 SF

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CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: December 14, 2023
PREPARED BY: Nick Melloni, AICP, Principal Planner
REQUEST: APPROVAL OF MILLS ACT CONTRACTS BETWEEN THE CITY AND

THE PROPERTY OWNER OF THREE INDIVIDUAL HISTORICAL

PROPERTIES
RECOMMENDATION:

1. Adopt a resolution entitled, “A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

PALM DESERT, CALIFORNIA, APPROVING A MILLS ACT AGREEMENT BETWEEN THE CITY AND THE OWNER OF THE PROPERTY LOCATED AT 373 SANDPIPER STREET, CASE NOS. MILLS23-0003.”

2. Adopt a resolution entitled, “A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

PALM DESERT, CALIFORNIA, APPROVING A MILLS ACT AGREEMENT BETWEEN THE CITY AND THE OWNER OF THE PROPERTY LOCATED AT 382 SANDPIPER STREET, CASE NOS. MILLS23-0004.”

3. Adopt a resolution entitled, “A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

PALM DESERT, CALIFORNIA, APPROVING A MILLS ACT AGREEMENT BETWEEN THE CITY AND THE OWNER OF THE PROPERTY LOCATED AT 381 SANDPIPER STREET, CASE NO. MILLS23-0008.”
BACKGROUND/ANALYSIS:

The Mills Act Program enables California cities to enter contracts with owners of historical properties (as designated by the City Council) to provide them with tax relief in exchange for a contract to actively participate in the restoration and maintenance of historical resources. A Mills Act contract is effective for an initial 10-year period and then is automatically extended annually for an additional year, unless, after the initial term, either the City or the owner, by written notice, decides not to renew the contract. During the effective term of the contract, the property owner must improve, rehabilitate, or maintain the property consistent with the United State Secretary of the Interior’s Standards for Rehabilitation, and provide visibility of the historical resource from the public right-of-way and/or other accessible areas.

The Environmental Resources Element (ERE) of the General Plan describes the City’s goals and policies for the protection of cultural resources. Goals 6.9.4 and 6.9.5 state that the City will require sites with significant cultural resources and structures to be preserved. A property must be designated as a local Historic Landmark or be a contributing property to a Historic District to be enrolled in the program. Currently, there are 33 properties participating in the program, with the last requests approved by the Council in November 2022. An additional 8 properties are pending recordation of the agreements approved by City Council on November 16, 2023 The items presented include three separate requests for Mills Act contracts. These requests include three contributors to the Sandpiper Circle #3 Historic District:

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City of Palm Desert
Mills Act Contract Approval

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Table 1 – Proposed Mills Act Contract Properties
Environment Review:

Entering into a “Mills Act Contract” with the owners of historical property is not subject to the provisions of the California Environmental Quality Act (CEQA) because it is not a project as defined in CEQA Guidelines § 15378 (Definitions – Project). Implementation of the Mills Act is a government fiscal activity which does not involve commitment to any specific project resulting in a potentially significant physical impact on the environment (CEQA Guidelines § 15378 (b) (4)).

Legal Review:

This report has been reviewed by the City Attorney’s office.

FINANCIAL IMPACT:

After the Mills Act Contracts are recorded, the County Assessor values the property by an income capitalization method, following guidelines provided by the State Board of Equalization.

Because of the timing and the method of valuing the restricted property, it is difficult to accurately estimate the tax savings and resulting fiscal impacts to the City under a particular historical property contract. However, the Office of Historic Preservation (California Department of Parks and Recreation) estimates that property owners participating in the program may realize property tax savings of between 40% and 60% each year for newly improved or purchased older properties. The City’s property tax revenue will be reduced accordingly.

ATTACHMENTS:

1. Draft Resolution and Mills Act Contract for 373 Sandpiper Street (MILLS23-0003)

2. Draft Resolution and Mills Act Contract for 382 Sandpiper Street (MILLS23-0004)

3. Draft Resolution and Mills Act Contract for 381 Sandpiper Street (MILLS23-0008) Case No. Address Landmark / District Name Date of Council Designation
1 MILLS23-0003 373 Sandpiper Street Sandpiper Circle #3 2/10/2022 2 MILLS23-0004 382 Sandpiper Street Sandpiper Circle #3 2/10/2022 3 MILLS23-0008 381 Sandpiper Street Sandpiper Circle #3 2/10/2022

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RESOLUTION NO. 2023-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT,

CALIFORNIA, APPROVING A MILLS ACT AGREEMENT BETWEEN THE CITY AND THE OWNER OF THE PROPERTY LOCATED AT 373
SANDPIPER STREET, CASE NOS. MILLS23-0003
WHEREAS, the City Council of the City of Palm Desert is authorized by California Government Code § 50280 et seq. (known as “the Mills Act”) to enter into contracts with the owners of qualified historical properties to provide for appropriate use, maintenance, and rehabilitation such that these historic properties retain their historic characteristics; and WHEREAS, the City Council of the City of Palm Desert has adopted Resolution No. 9136 (2000 Series), establishing the Mills Act Historic Property Tax Incentive Program as an ongoing historic preservation program to promote the preservation, maintenance, and rehabilitation of historic resources through financial incentives; and WHEREAS, the City Council of the Palm Desert has designated this property as a historic resource of the City of Palm Desert pursuant to the policies in the Title 29 of the Palm Desert Municipal Code; and
WHEREAS, George Lynn Lashbrook and Elizabeth Ann Lashbrook are the owners of that certain qualified real property, together with associated structures and improvement thereon, located on Assessor’s Parcel Number 640-260-014, located at 373 Sandpiper Street, in the City of Palm Desert, California; and
WHEREAS, the City and the Owners, for their mutual benefit, now desire to enter into an agreement to limit the use of the property to prevent inappropriate alterations and to ensure that character-defining features are preserved and maintained in an exemplary manner, and repairs and improvements are completed as necessary to carry out the purposes of California Government Code, Chapter 1, Part 5 of Division 1 of Title 5, Article 12, Sec. 50280 et seq., and to qualify for an assessment of valuation pursuant to Article 1.9, Sec. 439 et. seq. of the Revenue and Taxation Code; and
WHEREAS, the City Council conducted a public hearing in the Council Chamber of City Hall, 73510 Fred Waring Drive, Palm Desert, California, on December 14, 2023, for the purpose of considering approval of the historic property preservation agreement, and has duly considered all evidence and testimony of the applicant and interested parties, and the evaluation and recommendation by staff, present at said hearing; and WHEREAS, notices of said public hearings were made at the time and in the manner required by law.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Palm Desert, California, as follows:

SECTION 1. Findings. Based upon all the evidence, the City Council makes the following findings:

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a) Environmental Resources Element Program 6.9.4 and 6.9.5 states that the City will require sites with significant cultural resources and structures to be preserved.
b) The subject property, located at 373 Sandpiper Street, has been recognized as a historic asset in the community by its designation as a Contributing Assess to a Historic District by the City Council by Resolution No. 2022-08 on February 10, 2022. As such, maintaining the structure will meet the City’s goals for historic preservation listed in policies 6.9.4 and 6.9.5 of the Environmental Resources Element.

SECTION 2. Environmental Determination. The City Council has determined that the above actions do not constitute a project, as defined in California Environmental Quality Act Guidelines § 15378 and are not subject to environmental review.

SECTION 3. Historic Property Preservation Agreement Approved. The City Council hereby approves the Mills Act Agreement between the City of Palm Desert and the Owner of the Historic Property Located at 373 Sandpiper Street, to be entered into by the City and the property owners, George Lynn Lashbrook and Elizabeth Ann Lashbrook.

SECTION 4. City Manager Authorized to Sign Agreement for City. The City Council hereby authorizes the Community Development Director to execute said agreement on behalf of the Council of the City of Palm Desert.

SECTION 4. Custodian of Records. The documents and materials that constitute the record of proceedings on which these findings are based are located at the City’s office at 73510 Fred Waring Drive, Palm Desert, CA 92260. Anthony J. Mejia, MMC, the City Clerk of the City of Palm Desert is the custodian of the record of proceedings.

SECTION 6. Effective Date. This Resolution shall become effective immediately upon its adoption.

ADOPTED ON December 14, 2023.

KATHLEEN KELLY
MAYOR
ATTEST:

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ANTHONY J. MEJIA

CITY CLERK

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STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.

CITY OF PALM DESERT )
I, Anthony J. Mejia, City Clerk of the City of Palm Desert, California, DO HEREBY CERTIFY that the foregoing Resolution No. 23-__ was duly adopted by the City Council of the City of Palm Desert at a regular meeting held on the ___ day of November, 2023 by the following vote of the Council:

AYES:

NOES:

ABSENT:
(SEAL)
_________________________
ANTHONY J. MEJIA

CITY CLERK

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RECORDING REQUESTED BY, AND
WHEN RECORDED, MAIL TO:

City Clerk’s Office
City of Palm Desert
73-510 Fred Waring Drive
Palm Desert, CA 92260-2578

FOR THE BENEFIT OF THE

CITY OF PALM DESERT
- NO FEE -
6103 OF THE GOVT. CODE
(This Space for Recorder’s Use Only)

Historic Property Preservation Agreement
(“Mills Act Contract”)
Between
City of Palm Desert, California
a Municipal Corporation “City”
and

LASHBROOK TRUST / GEORGE & ELIZABETH ANN LASHBROOK
“Owner”
Legal Description of Property
APN (640-260-0014)
373 SANDPIPER ST, PALM DESERT, CA 92260-3420
Dated: December 14, 2023
(Resolution No. 2022-08 – Case No. CRPC22-01
Approved at the Palm Desert City Council Meeting of February 10, 2022) ____________________________________________________________________________________________________________ MILLS ACT CONTRACT APPROVED BY RESOLUTION NO. 2023-
(Title of Document)

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2 HISTORIC PROPERTY PRESERVATION AGREEMENT
(“MILLS ACT CONTRACT or Agreement”)
This agreement is made this December 14, 2023, by and between the City of Palm Desert, a municipal corporation (“City”) and LASHBROOK TRUST / GEORGE & ELIZABETH

ANN LASHBROOK
(“Owner”).

RECITALS

1. California Government Code section 50280, et. seq. allows cities the discretion to enter into contracts with the owners of qualified historic properties, as that term is defined in Government Code section 50280.1, for the purpose of providing for the use, maintenance, protection, and restoration of such historic property so as to retain its characteristics as property of historic significance.

2. Owner holds fee title in and to that certain real property, together with associated structures and improvements thereon, generally located at the street address 373 SANDPIPER ST Palm Desert, California (“Historic Property”). A legal description of the Historic Property is attached hereto as Exhibit “A,” and incorporated herein by this reference.

3. On February 10, 2022, the Cultural Resources Preservation Committee and/or the City Council designated the Historic Property as an historic resource pursuant to the terms and provisions of Title 29 of the Palm Desert Municipal Code.

4. City and Owner desire to enter into this Agreement for the purpose of protecting and preserving the characteristics of historical significance of the Historic Property that help provide the community with its own unique civic identity and character.

5. Owner, in consideration for abiding by the terms of this Agreement, shall be entitled to qualify for a reassessment of valuation of the Historic Property, pursuant to the provisions of Chapter 3, Part 2, of Division 1 of the California Revenue and Taxation Code, and any corresponding adjustment in property taxes resulting therefrom.

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3 TERMS NOW, THEREFORE, the City and Owner in consideration of mutual covenants and conditions set forth herein, do hereby agree as follows:

1. Effective Date and Term of Agreement. This Agreement shall be effective and commence on December 14, 2023, (“Effective Date”) and shall remain in effect for a term of ten (10) years thereafter.

2. Yearly Renewal. Each year upon the anniversary of the Effective Date (“Renewal Date”), an additional one (1) year shall automatically be added to the remaining term of the Agreement unless a notice of nonrenewal is delivered as provided in Section 3 of this Agreement.

3. Nonrenewal. If either the Owner or City desires in any year not to renew this Agreement, Owner or City shall serve a written notice of nonrenewal upon the party in advance of the Renewal Date (“Notice of Nonrenewal”). The Notice of Nonrenewal shall be effective only if served by Owner upon City at least ninety (90) days prior to the Renewal Date, or if served by City upon Owner, the Notice of Nonrenewal shall be effective only if served upon Owner at least sixty (60) days prior to the Renewal Date. If either City or Owner serves a Notice of Nonrenewal in any year, this Agreement shall remain in effect for the balance of the term then remaining.

4. Owner Protest of City Nonrenewal. Within fifteen (15) days of Owner’s receipt of the Notice of Nonrenewal from City, Owner may file with City a written protest of the Notice of Nonrenewal. Upon receipt of the written protect, the City Council shall set a hearing prior to the expiration of the Renewal Date of this Agreement. Owner may furnish the City Council with any information which Owner deems relevant and shall furnish the City Council with any information it may require.

The City Council may, at any time prior to the annual Renewal Date, withdraw its Notice of Nonrenewal.

5. Standards for Historical Property. During the term of this Agreement, the Historic Property shall be subject to the following conditions, requirements, and restrictions:

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4 A. Owner shall preserve and maintain the characteristics of the cultural and historical significance of the Historic Property. Attached hereto as Exhibit “B,” and incorporated herein by this reference, is a list of the minimum standards and conditions for maintenance, use, protection, and preservation of the Historic Property, which shall apply to the Historic Property and be complied with by Owner throughout the term of this Agreement. In addition, Owner shall comply with the terms of the City’s Cultural Resources Ordinance 1168 (Title 29 of the Palm Desert Municipal Code), and shall obtain any applicable permits necessary to protect, preserve, restore, and rehabilitate the Historic Property so as to maintain its historical and cultural significance.

B. Owner shall, where necessary, repair, maintain, restore, and rehabilitate the Historic Property according to the rules and regulations of the Office of Historic Preservation of the State Department of Parks and Recreation and the City of Palm Desert. The condition of the exterior of the Historic Property on the effective date of this Agreement is documented in photographs attached as Exhibit “C” and incorporated herein by this reference. At a minimum, Owner shall continually maintain the exterior of the Historic Property in the same condition as documented in Exhibit “C.”
C. Owner shall carry out specific restoration, repair, maintenance, and/or rehabilitation projects on the Historic Property, as outlined in the attached Exhibit “D,” which is incorporated herein by this reference. All such projects shall be undertaken and completed in accordance with the Secretary of Interior Standards for Rehabilitation and the City of Palm Desert design guidelines.

D. Owner shall not be permitted to block the view corridor with any new structure, such as walls, fences, or shrubbery, so as to prevent the viewing of the Historic Property from the public right-of-way.

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5 6. Periodic Examinations. Upon reasonable advance notice, Owner shall allow reasonable periodic examinations of the interior and exterior of the Historic Property by representatives of the County Assessor, the State Department of Parks and Recreation, the State Board of Equalization and/or City, as may be necessary to determine Owner’s compliance with the terms and provisions of this Agreement. City shall inspect Historic Property prior to entering into this Agreement and at least every five years thereafter to determine Owner’s continued compliance with Agreement.

7. Provision of Information of Compliance. Owner hereby agrees to furnish City with any and all information requested by City, which City deems necessary or advisable to determine eligibility of the Historic Property and compliance with the terms and provisions of this Agreement.

8. Breach of Agreement; Remedies.

A. Notice of Breach; Opportunity to Cure. If Owner breaches any provision of this Agreement, City may give written notice to Owner by registered or certified mail detailing Owner’s violations. If such violation is not corrected to the reasonable satisfaction of City within thirty (30) days after the date of notice of violation, or within such a reasonable time as may be required to cure the violation (provided the acts to cure the violation are commenced within thirty (30) days and thereafter diligently pursued to completion), the City may, without further notice, declare Owner to be in breach of this Agreement. Upon City’s declaration of Owner’s breach, City may pursue any remedy available under local, state, or federal law, including those specifically provided for in this section.

B. Remedy - Cancellation. City may cancel this Agreement if City determines, following a duly noticed public hearing in accordance with Government Code section 50286, that Owner breached any of the conditions of the Agreement, Owner allowed the Historic Property to deteriorate to the point that it no longer meets the standards for a

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6 qualified historic property, or Owner failed to maintain and preserve the Historic Property in accordance with the terms of this Agreement. If this Agreement is cancelled, under this paragraph, Owner shall pay a cancellation fee to the Office of the Auditor for the County of Riverside as required by Government Code section 50286.

C. Alternative Remedies. As an alternative to cancellation of this Agreement for Owner’s breach of any condition, City may bring an action in court necessary to enforce this Agreement including, but not limited to, an action to enforce this Agreement by specific performance, injunction, or receivership.

9. Destruction of Property; Eminent Domain; Cancellation. If the Historic Property is destroyed by earthquake, fire, flood, or other natural disaster such that in the opinion of the City Building Official more than sixty percent (60%) of the original fabric of the structure must be replaced, this Agreement shall be cancelled because the historic value of the structure will have been destroyed. If the Historic Property is acquired in whole or in part by eminent domain or other acquisition by any entity authorized to exercise the power of eminent domain, and the acquisition is determined by the City Council to frustrate the purpose of this Agreement, this Agreement shall be cancelled. No cancellation fee pursuant to Government Code section 50286 shall be imposed if the Agreement is cancelled pursuant to this Section.

10. Waiver. City does not waive any claim of default by Owner if City does not enforce or cancel this Agreement. All other remedies at law or in equity which are not otherwise provided for in this Agreement or in City’s regulations governing historic properties are available to the City to pursue in the event that there is a reach of this Agreement. No waiver by City of any breach or default under this Agreement shall be deemed to be a waiver of any other subsequent breach thereof or default hereunder.

11. Binding Effect of Agreement. Owner hereby subjects the Historic Property to the covenants, conditions, and restrictions set forth in this Agreement. City and Owner hereby declare their specific intent that the covenants, conditions, and

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7 restrictions set forth herein shall be deemed covenants running with the land and shall inure to and be binding upon Owner’s successors and assigns in title or interest to the Historic Property. Each and every contract, deed or other instrument herein after executed, covering or conveying the Historic Property, or any portion thereof, shall conclusively be held to have been executed, delivered and accepted subject to the covenants, reservations and restrictions are set forth in such contract, deed or other instrument.

12. Covenants Run with the Land. City and Owner hereby declare their understanding and intent that the burden of the covenants, reservations and restrictions set forth herein touch and concern the land in that it restricts development of the Historic Property. City and Owner hereby further declare their understanding and intent that the benefit of such covenants, reservations and restrictions touch and concern the land by enhancing and maintaining the cultural and historical characteristics and significance of the Historic Property for the benefit of the public and the Owner.

13. Notice. Any notice required to be given by the terms of this Agreement shall be provided at the address of the respective parties as specified below or at any other address as may be later specified by the parties hereto:

City: City of Palm Desert
Planning Division
73-510 Fred Waring Drive
Palm Desert, CA 92260
Owner: LASHBROOK TRUST / GEORGE & ELIZABETH ANN

LASHBROOK
1796 NW 17th CT.,
GRESHAM, OR 97030

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8 14. Effect of Agreement. None of the terms, provisions or conditions of this Agreement shall be deemed to create a partnership between the parties hereto and any of their heirs, successors or assigns, nor shall such terms, provisions or conditions cause the parties to be considered joint venturers or members of any joint enterprise.

15. Indemnity of City. Owner shall defend, indemnify, and hold harmless City and its elected officials, officers, agents and employees from any actual or alleged claims, demands, causes of action, liability, loss, damage, or injury to property or persons, including wrongful death, whether imposed by a court of law or by administrative action of any federal, state or local governmental agency, arising out of or incident to (i) the direct or indirect use operation, or maintenance of the Historic Property by Owner or any contractor, subcontractor, employee, agent, lessee, licensee, invitee, or any other person; (ii) Owner’s activities in connection with the Historic Property; and (iii) any restrictions on the use or development of the Historic Property, from application or enforcement of Title 29 of the City’s Municipal Code, or from the enforcement of this Agreement. This indemnification includes, without limitation, the payment of all penalties, fines, judgments, awards, decrees, attorneys’ fees, and related costs or expenses, and the reimbursement of City, its elected officials, employees, and/or agents for all legal expenses and costs incurred by each of them.

Owner’s obligation to indemnify shall survive the termination, cancellation, or expiration of this Agreement and shall not be restricted to insurance proceeds, if any, received by City, its elected officials, employees, or agents.

16. Binding Upon Successors. All of the agreements, rights, covenants, reservations and restrictions contained in this Agreement shall be binding upon and shall inure to the benefit of the parties herein, their heirs, successors, legal representatives, assigns and all persons acquiring any part or portion of the Historic Property, whether by operation of law or in any manner whatsoever.

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9 17. Legal Costs. In the event legal proceedings are brought by any party or parties to enforce or restrain a violation of any of the covenants, conditions or restrictions contained herein, or to determine the rights and duties of any party hereunder, the prevailing party in such proceeding may recover all reasonable attorneys’ fees to be fixed by the court, in addition to court costs and other relief ordered by the court.

18. Severability. In the event that any of the provisions of this Agreement are held to be unenforceable or invalid by any court of competent jurisdiction, or by subsequent preemptive legislation, the validity and enforceability of the remaining provisions, or portions thereof, shall not be affected thereby.

19. Recordation. No later than twenty (20) days after the Effective Date, City shall cause this Agreement to be recorded in the office of the County Recorder of the County of Riverside.

20. Amendments. This Agreement may be amended, in whole or in part, only by written recorded instrument executed by the parties hereto.

21. Governing Law and Venue. This Agreement shall be construed and governed in accordance with the laws of the State of California. Any action at law or in equity brought by either of the parties hereto for the purpose of enforcing a right or rights provided for by this Agreement shall be tried in a court of competent jurisdiction in the County of Riverside, State of California, and the parties hereby waive all provisions of law providing for a change of venue in such proceedings to any other county.

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10 IN WITNESS WHEREOF, City and Owner have executed this Agreement on the day and year first above written.

Dated: _______________ CITY OF PALM DESERT
By ______________________

KATHLEEN KELLY, MAYOR
ATTEST:

By ________________________________
ANTHONY J. MEJIA, CITY CLERK

CITY OF PALM DESERT, CALIFORNIA

APPROVED AS TO FORM
___

ISRA SHAH

CITY ATTORNEY
Dated: ________________ OWNER

By: ___________________________

GEORGE LYNN LASHBROOK,
OWNER
By: ___________________________

ELIZABETH ANN LASHBROOK,
OWNER

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11 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

State of ___________________ }
} SS.

County of __________________ }
On , 2023 , before me,____________________, a Notary Public, personally appeared__________________________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.

Signature

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12 Exhibit “A”

LEGAL DESCRIPTION OF HISTORIC PROPERTY
The following described property in the City of Palm Desert, County of Riverside, State of California:

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13 Exhibit “B”
Property Maintenance Minimum Standards

1. The Historic District Property shall comply with all regulations of Title 8 and Title 9 of the Palm Desert Municipal Code, including the definition of “Good Repair” as outlined in Section 29.20 and 29.60.160;

2. The Historic Property shall continue to be maintained in a manner consistent with the level of maintenance that has customarily been employed at the property and consistent with the typical condominium development in the Palm Desert Area.

3. The Historic Property shall not have non-operational vehicles or portions of them in public view.

4. The Historic Property Shall not have stagnant or standing water.

5. The Historic Property Shall not have overgrown or decaying landscaping. All landscape features should be maintained including, but not limited to, grass, trees, and any plantings.

6. The Historic Property shall prominently display and properly maintain its City Landmark plaque.

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14 Exhibit “C”
Exterior Photographs of Historic Property

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16 Exhibit “D”
10-Year Improvement Plan
10 Year Project Improvement Plan 373 Sandpiper St. Palm Desert, CA 92260 Year Projects/Areas
HOA
Per
Homeowner
1 (2023- 1.1 HOA Annual Maintenance/Repairs Pro-rata share of HOA budget/homeowner (1 of 24 homeowners)

1.11 Operating Expenditures
GL Acct Code
7080 Landscape Contract 43,200.00 1,800.00 ● Maintain and improve current landscape incl. ad hoc irrigation repairs 7091 Seed, Fertlizer, Plants 4,320.01 180.00 ● Replace and care for turf and plants 7100 Landscape Repairs & Maint 3,235.03 134.79 ● Repairs and replacement to landscape elements 7120 Irrigation Repairs 2,940.43 122.52 ● Repairs to 60 year old Irrigation system which covers 3 acres 7121 Lighting Repairs & Maint 1,973.76 82.24 ● Maintain historic lighting infrastructure 7130 Pool Contract 3,900.00 162.50 ● Cleaning & upkeep to ensure proper chemical levels to preserve pool 7140 Pool & Spa Repairs 1,450.00 60.42 ● Specific pool and pool equipment related repairs 7150 Pest Control 1,985.98 82.75 ● Prevent pest infestation/damage to buildings, structures and fixtures 7190 Tree Trimming 3,585.00 149.38 ● Palm tree trimming to ensure healthand appearnance of plants 7210 Common Area Repairs 1,452.63 60.53 ● Ad hoc repairs to cabana, fence, sidewalks, electrical and lighting Subtotal 68,042.84 2,835.12

1.12 Reserve Expenditures
Asphalt - Seal Coat 2,296.79 95.70 ● Seal coat all asphalt (13,117 SF), incl. Pitahaya St. parking area.

Grounds - Common Area 3,605.00 150.21 ● Misc. reserve expenditures (fans, trash recepticles and gates, carports) Grounds - Mailboxes 3,605.00 150.21 ● Replace two (2) mailboxes Irrigation - System Renovation, Phase 2 19,570.00 815.42 ● Major renovation to irrigation system in four (4) phases Painting - Wrought Iron 4,635.00 193.13 ● Paint the perimeter fencing and (13) light poles.

Pool Area - Extras 515.00 21.46 ● Misc pool/pool area related repair (eg. pool mastic) Subtotal 34,226.79 1,426.12
Subtotal (HOA) 68,042.84 4,261.23

1.2 Specific Homeowner Projects
Install patio breezeblock wall between #373 & 372 N/A 2,000.00 ● Construct privacy breezeblock screen based on Krisel designs HVAC maintenance N/A 150.00 ● HVAC servicing
Subtotal (Homeowner) N/A 2,150.00
Total 6,411.23
Address 373 Sandpiper St. Palm Desert, CA 92260
Est. Annual Cost Notes/Comments
The amounts show are from 2021 Sandpiper 3 on El Paseo HOA ("Circle 3") GL transaction records for areas specific to Mills Act; will be updated with GL actuals over City 2023-24 fiscal year (07/01- Forecasted reserve expenditures by year from April 2022 Reserve Analysis Report - select categories specific to Mills Act; will be updated with actual expenditures over City 2023-24 fiscal year 10 Year Project Improvement Plan 373 Sandpiper St. Palm Desert, CA 92260 Year Projects/Areas
HOA
Per
Homeowner
2 2.1 HOA Annual Maintenance/Repairs Pro-rata share of HOA budget/homeowner (1 of 24 homeowners)

2.11 Operating Expenditures
GL Acct Code
7080 Landscape Contract 43,200.00 1,800.00 ● Maintain and improve current landscape incl. ad hoc irrigation repairs 7091 Seed, Fertlizer, Plants 4,320.01 180.00 ● Replace and care for turf and plants 7100 Landscape Repairs & Maint 3,235.03 134.79 ● Repairs and replacement to landscape elements 7120 Irrigation Repairs 2,940.43 122.52 ● Repairs to 60 year old Irrigation system which covers 3 acres 7121 Lighting Repairs & Maint 1,973.76 82.24 ● Maintain historic lighting infrastructure 7130 Pool Contract 3,900.00 162.50 ● Cleaning & upkeep to ensure proper chemical levels to preserve pool 7140 Pool & Spa Repairs 1,450.00 60.42 ● Specific pool and pool equipment related repairs 7150 Pest Control 1,985.98 82.75 ● Prevent pest infestation/damage to buildings, structures and fixtures 7190 Tree Trimming 3,585.00 149.38 ● Palm tree trimming to ensure healthand appearnance of plants 7210 Common Area Repairs 1,452.63 60.53 ● Ad hoc repairs to cabana, fence, sidewalks, electrical and lighting Subtotal 68,042.84 2,835.12

2.12 Reserve Expenditures
Grounds - Common Area 3,713.15 154.71 ● Misc. reserve expenditures (fans, trash recepticles and gates, carports) Irrigation - System Renovation, Phase 3 21,218.00 884.08 ● Major renovation to irrigation system in four (4) phases Pool Area - Extras 530.45 22.10 ● Misc pool/pool area related repair (eg. pool mastic) Pool Area - Pool, Replaster 27,695.86 1153.99 ● Replaster the pool and replace the tile.

Subtotal 53,157.46 2,214.89
Subtotal (HOA) 121,200.30 5,050.01

2.2 Specific Homeowner Projects
Remove storage units (not original) on
courtyard and restore original design N/A 2,000.00 ● Replace bathroom cabinet/faucet HVAC Maintenance 150.00 ● HVAC servicing
Replace concrete pad on courtyard N/A 3,000.00 ● Concrete pad AC/heater replacement and relocation N/A 10,000.00 ● Replace AC and move outside courtyard (construct new pad) Subtotal (Homeowner) N/A 15,150.00
Total 20,200.01
Est. Annual Cost Notes/Comments
The amounts show are from 2021 Sandpiper 3 on El Paseo HOA ("Circle 3") GL transaction records for areas specific to Mills Act; will be updated with GL actuals over City 2024-25 fiscal year (07/01- 06/30)
Forecasted reserve expenditures by year from April 2022 Reserve Analysis Report - select categories specific to Mills Act; will be updated with actual expenditures over City 2024-25 fiscal year Page 336 of 1057 17 10 Year Project Improvement Plan 373 Sandpiper St. Palm Desert, CA 92260 Year Projects/Areas
HOA
Per
Homeowner 3 3.1 HOA Annual Maintenance/Repairs Pro-rata share of HOA budget/homeowner (1 of 24 homeowners)

3.11 Operating Expenditures
GL Acct Code
7080 Landscape Contract 43,200.00 1,800.00 ● Maintain and improve current landscape incl. ad hoc irrigation repairs 7091 Seed, Fertlizer, Plants 4,320.01 180.00 ● Replace and care for turf and plants 7100 Landscape Repairs & Maint 3,235.03 134.79 ● Repairs and replacement to landscape elements 7120 Irrigation Repairs 2,940.43 122.52 ● Repairs to 60 year old Irrigation system which covers 3 acres 7121 Lighting Repairs & Maint 1,973.76 82.24 ● Maintain historic lighting infrastructure 7130 Pool Contract 3,900.00 162.50 ● Cleaning & upkeep to ensure proper chemical levels to preserve pool 7140 Pool & Spa Repairs 1,450.00 60.42 ● Specific pool and pool equipment related repairs 7150 Pest Control 1,985.98 82.75 ● Prevent pest infestation/damage to buildings, structures and fixtures 7190 Tree Trimming 3,585.00 149.38 ● Palm tree trimming to ensure healthand appearnance of plants 7210 Common Area Repairs 1,452.63 60.53 ● Ad hoc repairs to cabana, fence, sidewalks, electrical and lighting Subtotal 68,042.84 2,835.12

3.12 Reserve Expenditures
Grounds - Common Area 3,824.54 159.36 ● Misc. reserve expenditures (fans, trash recepticles and gates, carports) Grounds - Entry Gates, Wrought Iron 7,430.54 309.61 ● Replace the wrought iron entry gates and locks Irrigation - System Renovation, Phase 4 21,854.54 910.61 ● Major renovation to irrigation system in four (4) phases Pool Area - Extras 546.36 22.77 ● Misc pool/pool area related repair (eg. pool mastic) Subtotal 33,655.98 1,402.33
Subtotal (HOA) 101,698.82 4,237.45

3.2 Specific Homeowner Projects
HVAC maintenance N/A 150.00 ● HVAC servicing
Subtotal (Homeowner) N/A 150.00
Total 4,387.45
Est. Annual Cost Notes/Comments
The amounts show are from 2021 Sandpiper 3 on El Paseo HOA ("Circle 3") GL transaction records for areas specific to Mills Act; will be updated with GL actuals over City 2025-26 fiscal year (07/01- Forecasted reserve expenditures by year from April 2022 Reserve Analysis Report - select categories specific to Mills Act; will be updated with actual expenditures over City 2025-26 fiscal year (07/01-06/30)
10 Year Project Improvement Plan 373 Sandpiper St. Palm Desert, CA 92260 Year Projects/Areas
HOA
Per
Homeowner 4 4.1 HOA Annual Maintenance/Repairs Pro-rata share of HOA budget/homeowner (1 of 24 homeowners)

4.11 Operating Expenditures
GL Acct Code
7080 Landscape Contract 43,200.00 1,800.00 ● Maintain and improve current landscape incl. ad hoc irrigation repairs 7091 Seed, Fertlizer, Plants 4,320.01 180.00 ● Replace and care for turf and plants 7100 Landscape Repairs & Maint 3,235.03 134.79 ● Repairs and replacement to landscape elements 7120 Irrigation Repairs 2,940.43 122.52 ● Repairs to 60 year old Irrigation system which covers 3 acres 7121 Lighting Repairs & Maint 1,973.76 82.24 ● Maintain historic lighting infrastructure 7130 Pool Contract 3,900.00 162.50 ● Cleaning & upkeep to ensure proper chemical levels to preserve pool 7140 Pool & Spa Repairs 1,450.00 60.42 ● Specific pool and pool equipment related repairs 7150 Pest Control 1,985.98 82.75 ● Prevent pest infestation/damage to buildings, structures and fixtures 7190 Tree Trimming 3,585.00 149.38 ● Palm tree trimming to ensure healthand appearnance of plants 7210 Common Area Repairs 1,452.63 60.53 ● Ad hoc repairs to cabana, fence, sidewalks, electrical and lighting Subtotal 68,042.84 2,835.12

4.12 Reserve Expenditures
Grounds - Common Area 3,939.28 164.14 ● Misc. reserve expenditures (fans, trash recepticles and gates, carports) Grounds - Shuffleboard 1,575.71 65.65 ● Resurface the shuffleboard court.

Grounds - Surveillance System 7,315.81 304.83 ● Replace surveillance system (four dome cameras and one DVR) Pool Area - Extras 562.75 23.45 ● Misc pool/pool area related repair (eg. pool mastic) Subtotal 13,393.55 558.06
Subtotal (HOA) 81,436.39 3,393.18

4.2 Specific Homeowner Projects
HVAC Maintenance 150.00 ● HVAC servicing
Subtotal (Homeowner) N/A 150.00
Total 3,543.18
Est. Annual Cost Notes/Comments
The amounts show are from 2021 Sandpiper 3 on El Paseo HOA ("Circle 3") GL transaction records for areas specific to Mills Act; will be updated with GL actuals over City 2026-27 fiscal year (07/01- Forecasted reserve expenditures by year from April 2022 Reserve Analysis Report - select categories specific to Mills Act; will be updated with actual expenditures over City 2026-27 fiscal year Page 337 of 1057 18 10 Year Project Improvement Plan 373 Sandpiper St. Palm Desert, CA 92260 Year Projects/Areas
HOA
Per
Homeowner 5 5.1 HOA Annual Maintenance/Repairs Pro-rata share of HOA budget/homeowner (1 of 24 homeowners)

5.11 Operating Expenditures
GL Acct Code
7080 Landscape Contract 43,200.00 1,800.00 ● Maintain and improve current landscape incl. ad hoc irrigation repairs 7091 Seed, Fertlizer, Plants 4,320.01 180.00 ● Replace and care for turf and plants 7100 Landscape Repairs & Maint 3,235.03 134.79 ● Repairs and replacement to landscape elements 7120 Irrigation Repairs 2,940.43 122.52 ● Repairs to 60 year old Irrigation system which covers 3 acres 7121 Lighting Repairs & Maint 1,973.76 82.24 ● Maintain historic lighting infrastructure 7130 Pool Contract 3,900.00 162.50 ● Cleaning & upkeep to ensure proper chemical levels to preserve pool 7140 Pool & Spa Repairs 1,450.00 60.42 ● Specific pool and pool equipment related repairs 7150 Pest Control 1,985.98 82.75 ● Prevent pest infestation/damage to buildings, structures and fixtures 7190 Tree Trimming 3,585.00 149.38 ● Palm tree trimming to ensure healthand appearnance of plants 7210 Common Area Repairs 1,452.63 60.53 ● Ad hoc repairs to cabana, fence, sidewalks, electrical and lighting Subtotal 68,042.84 2,835.12

5.12 Reserve Expenditures
Grounds - Common Area 4,057.46 169.06 ● Misc. reserve expenditures (fans, trash recepticles and gates, carports) Painting - Trim 11,685.48 486.90 ● Paint the wood and metal trim of the units Painting - Wrought Iron 5,216.73 217.36 ● Paint the perimeter fencing and (13) light poles.

Pool Area - Extras 579.64 24.15 ● Misc pool/pool area related repair (eg. pool mastic) Pool Area - Pool, Heater 4,173.39 173.89 ● Replace the Raypack pool heater Subtotal 25,712.70 1,071.36
Subtotal (HOA) 93,755.54 3,906.48

5.2 Specific Homeowner Projects
New electrical service box N/A 3,000.00 ● Electrical
HVAC maintenance N/A 150.00 ● HVAC servicing
Subtotal (Homeowner) N/A 3,150.00
Total 7,056.48
Est. Annual Cost Notes/Comments
The amounts show are from 2021 Sandpiper 3 on El Paseo HOA ("Circle 3") GL transaction records for areas specific to Mills Act; will be updated with GL actuals over City 2027-28 fiscal year (07/01- Forecasted reserve expenditures by year from April 2022 Reserve Analysis Report - select categories specific to Mills Act; will be updated with actual expenditures over City 2027-28 fiscal year 10 Year Project Improvement Plan 373 Sandpiper St. Palm Desert, CA 92260 Year Projects/Areas
HOA
Per
Homeowner 6 6.1 HOA Annual Maintenance/Repairs Pro-rata share of HOA budget/homeowner (1 of 24 homeowners)

6.11 Operating Expenditures
GL Acct Code
7080 Landscape Contract 43,200.00 1,800.00 ● Maintain and improve current landscape incl. ad hoc irrigation repairs 7091 Seed, Fertlizer, Plants 4,320.01 180.00 ● Replace and care for turf and plants 7100 Landscape Repairs & Maint 3,235.03 134.79 ● Repairs and replacement to landscape elements 7120 Irrigation Repairs 2,940.43 122.52 ● Repairs to 60 year old Irrigation system which covers 3 acres 7121 Lighting Repairs & Maint 1,973.76 82.24 ● Maintain historic lighting infrastructure 7130 Pool Contract 3,900.00 162.50 ● Cleaning & upkeep to ensure proper chemical levels to preserve pool 7140 Pool & Spa Repairs 1,450.00 60.42 ● Specific pool and pool equipment related repairs 7150 Pest Control 1,985.98 82.75 ● Prevent pest infestation/damage to buildings, structures and fixtures 7190 Tree Trimming 3,585.00 149.38 ● Palm tree trimming to ensure healthand appearnance of plants 7210 Common Area Repairs 1,452.63 60.53 ● Ad hoc repairs to cabana, fence, sidewalks, electrical and lighting Subtotal 68,042.84 2,835.12

6.12 Reserve Expenditures
Asphalt - Seal Coat 2,662.61 110.94 ● Seal coat all asphalt (13,117 SF), incl. Pitahaya St. parking area.

Grounds - Common Area 4,179.18 174.13 ● Misc. reserve expenditures (fans, trash recepticles and gates, carports) Irrigation - Controllers (2017) 1,910.48 79.60 ● Replace the five (2) controllers installed in 2017 Pool Area - Extras 597.03 24.88 ● Misc pool/pool area related repair (eg. pool mastic) Subtotal 9,349.30 389.55
Subtotal (HOA) 77,392.14 3,224.67

6.2 Specific Homeowner Projects
HVAC Maintenance 150 ● HVAC servicing
Replace foam roof N/A 7,500.00 ● Roof
Subtotal (Homeowner) N/A 7,650.00
Total 10,874.67
Est. Annual Cost Notes/Comments
The amounts show are from 2021 Sandpiper 3 on El Paseo HOA ("Circle 3") GL transaction records for areas specific to Mills Act; will be updated with GL actuals over City 2028-29 fiscal year (07/01- Forecasted reserve expenditures by year from April 2022 Reserve Analysis Report - select categories specific to Mills Act; will be updated with actual expenditures over City 2028-29 fiscal year Page 338 of 1057 19 10 Year Project Improvement Plan 373 Sandpiper St. Palm Desert, CA 92260 Year Projects/Areas
HOA
Per
Homeowner 7 7.1 HOA Annual Maintenance/Repairs Pro-rata share of HOA budget/homeowner (1 of 24 homeowners)

7.11 Operating Expenditures
GL Acct Code
7080 Landscape Contract 43,200.00 1,800.00 ● Maintain and improve current landscape incl. ad hoc irrigation repairs 7091 Seed, Fertlizer, Plants 4,320.01 180.00 ● Replace and care for turf and plants 7100 Landscape Repairs & Maint 3,235.03 134.79 ● Repairs and replacement to landscape elements 7120 Irrigation Repairs 2,940.43 122.52 ● Repairs to 60 year old Irrigation system which covers 3 acres 7121 Lighting Repairs & Maint 1,973.76 82.24 ● Maintain historic lighting infrastructure 7130 Pool Contract 3,900.00 162.50 ● Cleaning & upkeep to ensure proper chemical levels to preserve pool 7140 Pool & Spa Repairs 1,450.00 60.42 ● Specific pool and pool equipment related repairs 7150 Pest Control 1,985.98 82.75 ● Prevent pest infestation/damage to buildings, structures and fixtures 7190 Tree Trimming 3,585.00 149.38 ● Palm tree trimming to ensure healthand appearnance of plants 7210 Common Area Repairs 1,452.63 60.53 ● Ad hoc repairs to cabana, fence, sidewalks, electrical and lighting Subtotal 68,042.84 2,835.12

7.12 Reserve Expenditures
Grounds - Common Area 4,304.56 179.36 ● Misc. reserve expenditures (fans, trash recepticles and gates, carports) Pool Area - Extras 614.94 25.62 ● Misc pool/pool area related repair (eg. pool mastic) Subtotal 4,919.50 204.98
Subtotal (HOA) 72,962.34 3,040.10

7.2 Specific Homeowner Projects
Replace light switches and electrical outlets N/A 2,000.00 ● Electrical HVAC maintenance N/A 150.00 ● HVAC servicing
Subtotal (Homeowner) N/A 2,000.00
Total 5,040.10
Est. Annual Cost Notes/Comments
The amounts show are from 2021 Sandpiper 3 on El Paseo HOA ("Circle 3") GL transaction records for areas specific to Mills Act; will be updated with GL actuals over City 2029-30 fiscal year (07/01- Forecasted reserve expenditures by year from April 2022 Reserve Analysis Report - select categories specific to Mills Act; will be updated with actual expenditures over City 2029-30 fiscal year 10 Year Project Improvement Plan 373 Sandpiper St. Palm Desert, CA 92260 Year Projects/Areas
HOA
Per
Homeowner 8 8.1 HOA Annual Maintenance/Repairs Pro-rata share of HOA budget/homeowner (1 of 24 homeowners)

8.11 Operating Expenditures
GL Acct Code
7080 Landscape Contract 43,200.00 1,800.00 ● Maintain and improve current landscape incl. ad hoc irrigation repairs 7091 Seed, Fertlizer, Plants 4,320.01 180.00 ● Replace and care for turf and plants 7100 Landscape Repairs & Maint 3,235.03 134.79 ● Repairs and replacement to landscape elements 7120 Irrigation Repairs 2,940.43 122.52 ● Repairs to 60 year old Irrigation system which covers 3 acres 7121 Lighting Repairs & Maint 1,973.76 82.24 ● Maintain historic lighting infrastructure 7130 Pool Contract 3,900.00 162.50 ● Cleaning & upkeep to ensure proper chemical levels to preserve pool 7140 Pool & Spa Repairs 1,450.00 60.42 ● Specific pool and pool equipment related repairs 7150 Pest Control 1,985.98 82.75 ● Prevent pest infestation/damage to buildings, structures and fixtures 7190 Tree Trimming 3,585.00 149.38 ● Palm tree trimming to ensure healthand appearnance of plants 7210 Common Area Repairs 1,452.63 60.53 ● Ad hoc repairs to cabana, fence, sidewalks, electrical and lighting Subtotal 68,042.84 2,835.12

8.12 Reserve Expenditures
Grounds - Common Area 4,433.70 184.74 ● Misc. reserve expenditures (fans, trash recepticles and gates, carports) Painting - Pool Cabana 3,800.31 158.35 ● Painting
Pool Area - Extras 633.39 26.39 ● Misc pool/pool area related repair (eg. pool mastic) Subtotal 8,867.40 369.48
Subtotal (HOA) 76,910.24 3,204.59

8.2 Specific Homeowner Projects
HVAC Maintenance N/A 150.00 ● HVAC servicing
Subtotal (Homeowner) N/A 150.00
Total 3,354.59
Est. Annual Cost Notes/Comments
The amounts show are from 2021 Sandpiper 3 on El Paseo HOA ("Circle 3") GL transaction records for areas specific to Mills Act; will be updated with GL actuals over City 2030-31 fiscal year (07/01- Forecasted reserve expenditures by year from April 2022 Reserve Analysis Report - select categories specific to Mills Act; will be updated with actual expenditures over City 2030-31 fiscal year Page 339 of 1057 20 10 Year Project Improvement Plan 373 Sandpiper St. Palm Desert, CA 92260 Year Projects/Areas
HOA
Per
Homeowner 9

9.1 HOA Annual Maintenance/Repairs Pro-rata share of HOA budget/homeowner (1 of 24 homeowners)

9.11 Operating Expenditures
GL Acct Code
7080 Landscape Contract 43,200.00 1,800.00 ● Maintain and improve current landscape incl. ad hoc irrigation repairs 7091 Seed, Fertlizer, Plants 4,320.01 180.00 ● Replace and care for turf and plants 7100 Landscape Repairs & Maint 3,235.03 134.79 ● Repairs and replacement to landscape elements 7120 Irrigation Repairs 2,940.43 122.52 ● Repairs to 60 year old Irrigation system which covers 3 acres 7121 Lighting Repairs & Maint 1,973.76 82.24 ● Maintain historic lighting infrastructure 7130 Pool Contract 3,900.00 162.50 ● Cleaning & upkeep to ensure proper chemical levels to preserve pool 7140 Pool & Spa Repairs 1,450.00 60.42 ● Specific pool and pool equipment related repairs 7150 Pest Control 1,985.98 82.75 ● Prevent pest infestation/damage to buildings, structures and fixtures 7190 Tree Trimming 3,585.00 149.38 ● Palm tree trimming to ensure healthand appearnance of plants 7210 Common Area Repairs 1,452.63 60.53 ● Ad hoc repairs to cabana, fence, sidewalks, electrical and lighting Subtotal 68,042.84 2,835.12

9.12 Reserve Expenditures
Grounds - Common Area 4,566.71 190.28 ● Misc. reserve expenditures (fans, trash recepticles and gates, carports) Painting - Wrought Iron 5,871.48 244.65 ● Paint the perimeter fencing and (13) light poles.

Pool Area - Extras 652.39 27.18 ● Misc pool/pool area related repair (eg. pool mastic) Subtotal 11,090.58 462.11
Subtotal (HOA) 79,133.42 3,297.23

9.2 Specific Homeowner Projects
HVAC maintenance N/A 150.00 ● HVAC servicing
Subtotal (Homeowner) N/A 150.00
Total 3,447.23
Est. Annual Cost Notes/Comments
The amounts show are from 2021 Sandpiper 3 on El Paseo HOA ("Circle 3") GL transaction records for areas specific to Mills Act; will be updated with GL actuals over City 2031-32 fiscal year (07/01- Forecasted reserve expenditures by year from April 2022 Reserve Analysis Report - select categories specific to Mills Act; will be updated with actual expenditures over City 2031-32 fiscal year 10 Year Project Improvement Plan 373 Sandpiper St. Palm Desert, CA 92260 Year Projects/Areas
HOA
Per
Homeowner
10 10.1 HOA Annual Maintenance/Repairs Pro-rata share of HOA budget/homeowner (1 of 24 homeowners)

10.11 Operating Expenditures
GL Acct Code
7080 Landscape Contract 43,200.00 1,800.00 ● Maintain and improve current landscape incl. ad hoc irrigation repairs 7091 Seed, Fertlizer, Plants 4,320.01 180.00 ● Replace and care for turf and plants 7100 Landscape Repairs & Maint 3,235.03 134.79 ● Repairs and replacement to landscape elements 7120 Irrigation Repairs 2,940.43 122.52 ● Repairs to 60 year old Irrigation system which covers 3 acres 7121 Lighting Repairs & Maint 1,973.76 82.24 ● Maintain historic lighting infrastructure 7130 Pool Contract 3,900.00 162.50 ● Cleaning & upkeep to ensure proper chemical levels to preserve pool 7140 Pool & Spa Repairs 1,450.00 60.42 ● Specific pool and pool equipment related repairs 7150 Pest Control 1,985.98 82.75 ● Prevent pest infestation/damage to buildings, structures and fixtures 7190 Tree Trimming 3,585.00 149.38 ● Palm tree trimming to ensure healthand appearnance of plants 7210 Common Area Repairs 1,452.63 60.53 ● Ad hoc repairs to cabana, fence, sidewalks, electrical and lighting Subtotal 68,042.84 2,835.12

10.12 Reserve Expenditures
Grounds - Common Area 4,703.71 195.99 ● Misc. reserve expenditures (fans, trash recepticles and gates, carports) Painting - Trim 13,546.68 564.45 ● Paint the wood and metal trim of the units Painting - Units, Stucco & Trim 54,159.83 2256.66 ● Paint residential units exteriors Pool Area - Extras 671.96 28.00 ● Misc pool/pool area related repair (eg. pool mastic) Pool Area - Pool, Pump 2,217.46 92.39 ● Replace the Pentair Intelle-Flo variable speed pool pump Subtotal 75,299.64 3,137.49
Subtotal (HOA) 143,342.48 5,972.60

10.2 Specific Homeowner Projects
HVAC maintenance 150 ● HVAC serving
Flashing repair/replacement N/A 1,500.00 ● Roof flashing on sunflaps Subtotal (Homeowner) N/A 1,650.00
Total 7,622.60
Est. Annual Cost Notes/Comments
The amounts show are from 2021 Sandpiper 3 on El Paseo HOA ("Circle 3") GL transaction records for areas specific to Mills Act; will be updated with GL actuals over City 2032-33 fiscal year (07/01- Forecasted reserve expenditures by year from April 2022 Reserve Analysis Report - select categories specific to Mills Act; will be updated with actual expenditures over City 2032-33 fiscal year Page 340 of 1057 RESOLUTION NO. 2023-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT,

CALIFORNIA, APPROVING A MILLS ACT AGREEMENT BETWEEN THE CITY AND THE OWNER OF THE PROPERTY LOCATED AT 382
SANDPIPER STREET, CASE NOS. MILLS23-0004
WHEREAS, the City Council of the City of Palm Desert is authorized by California Government Code § 50280 et seq. (known as “the Mills Act”) to enter into contracts with the owners of qualified historical properties to provide for appropriate use, maintenance, and rehabilitation such that these historic properties retain their historic characteristics; and WHEREAS, the City Council of the City of Palm Desert has adopted Resolution No. 9136 (2000 Series), establishing the Mills Act Historic Property Tax Incentive Program as an ongoing historic preservation program to promote the preservation, maintenance, and rehabilitation of historic resources through financial incentives; and WHEREAS, the City Council of the Palm Desert has designated this property as a historic resource of the City of Palm Desert pursuant to the policies in the Title 29 of the Palm Desert Municipal Code; and
WHEREAS, George Lynn Lashbrook and Elizabeth Ann Lashbrook are the owners of that certain qualified real property, together with associated structures and improvement thereon, located on Assessor’s Parcel Number 640-260-020, located at 382 Sandpiper Street, in the City of Palm Desert, California; and
WHEREAS, the City and the Owners, for their mutual benefit, now desire to enter into an agreement to limit the use of the property to prevent inappropriate alterations and to ensure that character-defining features are preserved and maintained in an exemplary manner, and repairs and improvements are completed as necessary to carry out the purposes of California Government Code, Chapter 1, Part 5 of Division 1 of Title 5, Article 12, Sec. 50280 et seq., and to qualify for an assessment of valuation pursuant to Article 1.9, Sec. 439 et. seq. of the Revenue and Taxation Code; and
WHEREAS, the City Council conducted a public hearing in the Council Chamber of City Hall, 73510 Fred Waring Drive, Palm Desert, California, on December 14, 2023, for the purpose of considering approval of the historic property preservation agreement, and has duly considered all evidence and testimony of the applicant and interested parties, and the evaluation and recommendation by staff, present at said hearing; and WHEREAS, notices of said public hearings were made at the time and in the manner required by law.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Palm Desert, California, as follows:

SECTION 1. Findings. Based upon all the evidence, the City Council makes the following findings:

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a) Environmental Resources Element Program 6.9.4 and 6.9.5 states that the City will require sites with significant cultural resources and structures to be preserved.
b) The subject property, located at 382 Sandpiper Street, has been recognized as a historic asset in the community by its designation as a Contributing Assess to a Historic District by the City Council by Resolution No. 2022-08 on February 10, 2022. As such, maintaining the structure will meet the City’s goals for historic preservation listed in policies 6.9.4 and 6.9.5 of the Environmental Resources Element.

SECTION 3. Historic Property Preservation Agreement Approved. The City Council hereby approves the Mills Act Agreement between the City of Palm Desert and the Owner of the Historic Property Located at 382 Sandpiper Street, to be entered into by the City and the property owners, George Lynn Lashbrook and Elizabeth Ann Lashbrook.

SECTION 6. Effective Date. This Resolution shall become effective immediately upon its adoption.

ADOPTED ON December 14, 2023.

KATHLEEN KELLY
MAYOR
ATTEST:

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ANTHONY J. MEJIA

CITY CLERK

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STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.

AYES:

NOES:

ABSENT:
(SEAL)
_________________________
ANTHONY J. MEJIA

CITY CLERK

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RECORDING REQUESTED BY, AND
WHEN RECORDED, MAIL TO:

City Clerk’s Office
City of Palm Desert
73-510 Fred Waring Drive
Palm Desert, CA 92260-2578

FOR THE BENEFIT OF THE

CITY OF PALM DESERT
- NO FEE -
6103 OF THE GOVT. CODE
(This Space for Recorder’s Use Only)

Historic Property Preservation Agreement
(“Mills Act Contract”)
Between
City of Palm Desert, California
a Municipal Corporation “City”
and

GEORGE LYNN LASHBROOK AND ELIZABETH ANN LASHBROOK
“Owner”
Legal Description of Property
APN (640-260-0020)
382 SANDPIPER ST, PALM DESERT, CA 92260-3420
Dated: December 14, 2023
(Resolution No. 2022-08 – Case No. CRPC22-01
Approved at the Palm Desert City Council Meeting of February 10, 2022) ____________________________________________________________________________________________________________ MILLS ACT CONTRACT APPROVED BY RESOLUTION NO. 2023-
(Title of Document)

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ANN LASHBROOK
(“Owner”).

RECITALS

2. Owner holds fee title in and to that certain real property, together with associated structures and improvements thereon, generally located at the street address 382 SANDPIPER ST Palm Desert, California (“Historic Property”). A legal description of the Historic Property is attached hereto as Exhibit “A,” and incorporated herein by this reference.

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3 TERMS NOW, THEREFORE, the City and Owner in consideration of mutual covenants and conditions set forth herein, do hereby agree as follows:

The City Council may, at any time prior to the annual Renewal Date, withdraw its Notice of Nonrenewal.

5. Standards for Historical Property. During the term of this Agreement, the Historic Property shall be subject to the following conditions, requirements, and restrictions:

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8. Breach of Agreement; Remedies.

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Palm Desert City CouncilDecember 14, 2023

Palm Desert City Council
December 14, 2023