Palm Desert City Council
August 22, 2024

CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: August 22, 2024
PREPARED BY: Amy Lawrence, Deputy Director of Economic Development SUBJECT: CONSIDERATION OF A SPONSORSHIP REQUEST FOR THE TOUR DE

PALM SPRINGS IN COACHELLA VALLEY
RECOMMENDATION:

1. Consider approval of a community event sponsorship in the amount of $30,000 payable to CVSPIN, Inc., for the 2025 Tour de Palm Springs in Coachella Valley charity bicycle ride and walk.

2. Approve waiver of permit fees associated with event in an amount not to exceed $800.

3. Appropriate $30,000 from the Unobligated General Fund Reserve for this purpose to Account No. 1104800-4306201.

BACKGROUND/ANALYSIS:

CVSPIN, Inc., approached the City earlier this year to discuss using the Palm Desert Civic Center Park as a secondary overflow start for excess cyclists and a Standard and Support Gear (SAG) location for the 27th annual Tour de Palm Springs in Coachella Valley charity bicycle ride and walk, scheduled for Sunday, February 9, 2025. With an anticipated attendance of 5,000- 10,000 cyclists and 25,000-30,000 spectators, the organizers believe that a secondary start and additional SAG location would be beneficial to the overall event.

It is expected that a majority of cyclists from the Palm Springs start would stop by the Civic Center Park as a SAG location. Specifically, Palm Desert’s location would serve as a start for excess cyclists in the 24-mile, 36-mile, 56-mile, 85-mile, and 102-mile categories. As part of the event, CVSPIN anticipates having a balloon arch for the start/finish, possible vendors, music, cheerleading, and volunteer groups to oversee food and water stations and to hand out medals.

CVSPIN foresees roughly 85 percent of local participants in the Tour de Palm Springs using the Civic Center Park as either a start/finish or a SAG location. Subsequently, significant traffic control measures and public safety will be required. As such, CVSPIN is requesting a $30,000 sponsorship to help cover these costs, along with a waiver of associated permit fees.

As noted in the attached “2024 Tour de Palm Springs in Coachella Valley Economic Impact Survey,” 18 percent of respondents reported overnight stays in Palm Desert. With Palm Desert serving as a secondary location for cyclists with start times ranging from 6:30 a.m. to 9 a.m., those starting at the Civic Center Park may choose to book overnight stays in Palm Desert and patronize area restaurants and shops while attending the event. If the City Council approves sponsorship of this event, staff will request that the organizer submit an after-event summary with information on overnight stays to determine if the percentage increased due to the secondary start.

Regardless of whether the sponsorship is approved or not, if CVSPIN chooses to proceed with the secondary location at the Civic Center Park, staff will continue working with the organizers 991
City of Palm Desert
Consideration of Tour de Palm Springs in Coachella Valley Sponsorship Request

on event planning. This will include traffic control, public safety, and plans for overflow parking.

Staff will return to the City Council at a future date if any additional approvals are needed.

FINANCIAL IMPACT:

Community event sponsorship applications were due by April 30, 2024, for review by the Outside Agency Funding Committee to be included as part of the FY 2024-25 Annual Budget. Staff did inform the organizer of the application process and deadline; however, the application was not received in time. Therefore, CVSPIN’s sponsorship request was verbally presented to the Outside Agency Funding Committee who recommended that staff bring the request forward for City Council review upon receipt.

If this sponsorship is approved, an appropriation would be necessary from Unobligated General Fund Reserves to Account No. 1104800-4306201. Additionally, waiver of permit fees such as encroachment permit and park use fees are typically approved for City-sponsored events. This amount is anticipated not to exceed $800.

ATTACHMENTS:

1. Sponsorship Request

2. 2024-25 Community Event Sponsorship Application

3. Special Events Application

4. 2024 Economic Impact Survey
992
City of Palm Desert 2025
Good afternoon,
On behalf of CVSPIN, we are requesting sponsorship and funding for the 2025 Tour de Palm Springs in Coachella Valley for our second overflow start which we are wanting to have in the city of Palm Desert. The funds that we are requesting are both in kind and monetary.

In Kind Sponsorship:
- Permit
- Application fees
- Park fees
Monetary: $30,000
- Law enforcement
- Tops N Barricades
- Road Closures
- Traffic Control Plans
We are attaching our economic impact report and budget with this request. Our event is coming up on its 27th year being a part of the Coachella Valley. We are growing and looking to expand and have our overflow start located in Palm Desert to continue our mission of donating to local nonprofit organizations throughout the entire Coachella Valley. The event brings together 2,500 volunteers from throughout the Coachella Valley, 5,000 to 10,000 cyclists, and 25,000 to 30,000 spectators annually. Thank you again for your time and we look forward to working with your city for many years to come.

Cody Shelton Timothy Esser
Executive Director Founder/Owner/Volunteer
993
994
2023-OA-230
2024-25 COMMUNITY EVENT SPONSORSHIP REQUEST
City of Palm Desert
73-510 Fred Waring Drive
Palm Desert, CA 92260
RELEASE DATE: March 15, 2024
RESPONSE DEADLINE: April 30, 2024, 5:00 pm
RESPONSES MUST BE SUBMITTED ELECTRONICALLY TO:
https://secure.procurenow.com/portal/cityofpalmdesert
995
City of Palm Desert
2024-25 Community Event Sponsorship Request
I. Notice Inviting Applications for Community Event Sponsorships II. Organization & Event Information.........................................................................................

III. Evaluation Criteria..............................................................................................................................

Attachments:

A - Res 2024-001 - Community Event Sponsorship Policy
996
undefined #2023-OA-230
Title: 2024-25 Community Event Sponsorship Request
3 1. Notice Inviting Applications for Community Event Sponsorships

1.1. Purpose
The City of Palm Desert aims to foster a vibrant community by supporting events that encourage civic engagement, celebrate cultural diversity, stimulate tourism, drive economic vitality, and uphold public health and sustainability.

1.2. General Requirements
Applicants for community event sponsorships must meet all the following requirements:

A. Applicants must independently conduct the community event or collaborate with another organization to be eligible to receive a sponsorship.

B. The community event must take place within Palm Desert city limits, with limited exceptions. Reason(s) for not holding the proposed event within Palm Desert city limits must be stated on the application. Exemption from this requirement will be provided on a case-by-case basis and will favor activity promoting the City of Palm Desert as a desirable place to live, visit, and do business.

C. If applicable, applicants agree to submit a Special Events Application/Agreement a minimum of 120 days prior to the event, or a Temporary Use Permit (TUP).

D. Applicants agree to use sponsorship funds exclusively for the community event represented in the application.

E. Recipients shall provide the City recognition as a sponsor in exchange for the sponsorship in a method consistent with other sponsors at the community event. In no event shall the recognition for the City's sponsorship be less than that provided to other sponsors who have contributed the same total financial or in-kind support.

F. If applicable, applicants are required to enter a sponsorship agreement with the City and provide a certificate of liability insurance or proof of self-insurance.

G. Community event sponsorship applications are limited to one per year, per taxpayer identification number.

H. Sponsorships will be approved on a competitive basis and are not guaranteed. Applicants should be aware that they may not receive the full amount of sponsorship requested.

I. Sponsorship approvals are made on an annual basis and shall be considered as a one-time approval. Approval for sponsorship in one year does not imply or guarantee that the City will approve sponsorship for the same event or organization in subsequent years.

J. An official post-community event evaluation must be submitted to City staff within ninety (90) days following the conclusion of a sponsored community event. 997
undefined #2023-OA-230
Title: 2024-25 Community Event Sponsorship Request
4 Due to limited resources, not all community event sponsorship requests are funded. The number of community events that the City sponsors varies annually. The City will evaluate each request based upon available funds, satisfaction of the eligibility criteria, and compliance with the Community Event Sponsorship Policy.

1.3. Ineligible Organizations and Activities
Examples of ineligible organizations or activities include, but are not limited to:

A. Any non-community event request, such as on -going programming or structured activities.

B. Private events or events that re not open to the general public.

C. Discriminatory activities such as those restricted based on a person's race, religion, ethnicity, age, sex, gender, gender identity, gender expression, disability, sexual orientation, or economic status.

D. A political, politically affiliated, or political action organization or event that promotes any political viewpoint, provides for a political purpose or causes participants to engage in otherwise affiliate or express an endorsement of partisan political functions or activities.

E. An event or activity that promotes a religious purpose (as opposed to a secular purpose, such as promoting cultural heritage or community understanding).

F. A private individual for his/her own use.

G. Funds may not be used for cash prizes, cash awards, salaries, salary reimbursement, or general budget subsidy.

H. Funds cannot be directly provided to specific individuals, nor may funds be constructively provided to specific individuals (e.g. using funds to pay for certain individuals to go to an event is not permitted). By contract, using funds to reduce the overall costs of an event is permitted.

I. An organization receiving Outside Agency funding concurrently (during the same fiscal year).

J. A K-12 school or school-related groups, as funding requests for schools and school-related groups shall be processed by the Outside Agency/Charitable Contributions Committee.

1.4. Additional Assessment Criteria
A. An applicant's first sponsorship request may total no more than 50% of the community event budget (if sponsorship includes in-kind, value of the in-kind items may not equal more than 50% of the event budget).
998
undefined #2023-OA-230
Title: 2024-25 Community Event Sponsorship Request
5 B. An applicant's second or subsequent sponsorship request may total no more than 35% of the community event budget (if sponsorship includes in-kind, value of the in-kind items may not equal more than 35% of the event budget).

C. Sponsorship requests for a 5K walk/run shall be eligible for a maximum sponsorship of $2,500.

D. Special consideration will be given to registered local non-profit corporations or local 501(c) organizations with tax-exempt status.
999
undefined #2023-OA-230
Title: 2024-25 Community Event Sponsorship Request
6 2. Organization & Event Information

2.1. General Information

2.1.1. Cody Shelton
Please provide the name of the primary contact associated with this funding request. *Response required

2.1.2. Executive Director
*Response required

2.1.3. 77971 Wildcat Dr. Suite E, Palm Desert, CA, 92260 *Response required

2.1.4. Physical Address If Different from Above

2.1.5. 760-574-1305
*Response required

2.1.6. [email protected]
*Response required

2.1.7. 33-0836672
*Response required

2.1.8. Non-Profit Tax Status Verification
Required for non-profit organizations. Please upload your organization's tax status verification letter from the Internal Revenue Service (IRS).

2.1.9. IRS Form W-9*
Please upload your updated IRS Form W-9.
*Response required

2.1.10. Palm Desert Business License Number
Required for any work or service performed within Palm Desert city limits.

2.1.11. Certification*
By clicking the confirmation box below, the submitter certifies that they are an authorized official of the applying organization. The applicant does hereby confirm that the information herein is true and correct; that the applicant organization meets the guidelines set forth in the Community Events Sponsorship policy published on the City’s website; and that the applicant’s organization will make these events available to all eligible participants, without regard to race, religion, ethnicity, age, sex, gender, gender identity, gender expression, disability, sexual orientation, or economic status. ☒ Please confirm
*Response required
1000
undefined #2023-OA-230
Title: 2024-25 Community Event Sponsorship Request
7 2.2. Event Details

2.2.1. Event Title
- Tour de Palm Springs in Coachella Valley

2.2.2. Event Date
- 2/7/25 - 2/8/25

2.2.3. Amount of Funding Request
- $30,000
I

2.2.4. Brief Description of Event
- Charity bicycle ride and walk earning funds for non-profit groups in the Coachella Valley

2.2.5. Will the event(s) take place within Palm Desert city limits? * ☒ Yes
☐ No
*Response required
When equals "No"

2.2.6. If no, where will it take place and why?*

2.2.7. Number of years the event has been held*
- 27 years
I

2.2.8. Expected Attendance*
- 5,000-10,000

2.2.9. Estimated Residents & Non-Residents*
- 20% Resident, 80% Non-Resident

2.2.10. Will there be a charge to those attending?*
☒ Yes
☐ No
*Response required
When equals "Yes"
1001
undefined #2023-OA-230
Title: 2024-25 Community Event Sponsorship Request
8 2.2.11. How much are attendees charged?*
- Attendees are being based on category entered. Cyclists will be charged up to $120 based on distance and walkers up to $25 based on distance.

2.2.12. How will the event(s) be publicized?*
- media, social media, nationally, digitally, hard copies with magazines and cycling shops

2.2.13. Event Budget*
Please upload a full budget, including revenue and expenses for each event you are requesting funding for. Please be as specific as possible, with detailed line items. *Response required

2.2.14. Intended use of City funds *
- To pay for the traffic control plans for street closures, permits and application fees, Law enforcement for traffic control to ensure safety

2.2.15. Other Funding Sources*
List all funding requested from other community partners for this event, including type of request (grant, sponsorship, donation, fundraiser, etc.), the amount your agency requested, and the actual amount received, and a description of the funding requested. - City of Palm Springs 23/24, requested $65,000 received $65,000 - City of Palm Springs 24/25, requested $100,000
- PS Resorts 23/24, requested $40,000 received $40,000
- PS Resorts 24/25. Not Requested yet but will be asking for $40,000

2.2.16. If applicable, attach a sponsorship benefit packet (e.g., name/logo listing, banner, ad, etc.)

2.2.17. List sponsorship benefits associated with the funding request* - Name/Logo listing on our website, on media with promotion of the second overflow start
1002
Budget 2023 Event
Tour de Palm Springs In Coachella Valley x
Event Costs
Advertising & Marketing 9,000
Apparel (Jerseys & T-Shirts) 27,000
Banners & Signs 2,000
Donations to Charities 300,000
Fees/Yearly Use of name 2,000
Insurance- Liability - USA Cycling 18,000
Meetings 2,000
Permits/Police Services 80,000
Registration Costs (fees/gifts) 7,000
Rentals 25,000
Route Costs (arrows/Ride with GPS) 2,000
SAG Costs (gatoraide/gas card) 2,000
Security 2,500
Supplies 7,000
Temporary Labor 1,000
Administrative Expenses
Accounting Fees 2,400
Credit Card Services/Fees/quick Book Fees 1,500
Dues & Subscriptions 2,500
Insurance 18,000
Internet/Phone 2,400
Office Supplies & Postage 2,500
Payroll Expenses (Wages/Taxes/Service/WC Ins) 30,000
Professional Fees 10,000
Rent 12,000
Taxes (Fed & State) 2,000
Total 560,800
1003
Budget 2024 Event
Tour de Palm Springs In Coachella Valley Committee cost 22924
Administration Yearly
Donations to charities 300000
Accounting fees
Event agreement 120
Insurance- Liability - USA Cycling insurance 23,552.68
Labor- Ex Dir 65,000
Labor- Misc (Deb) 2,900.00
Meeting- Kick off 750
Meeting- Post event wrap up 750
Meetings- Monthly
Party- Appreciation
Rent 12,000.00
Taxes
Credit Card Services/Fees/quick Book Fees x
Dues & Subscriptions
Insurance - USLI 653.2
Internet/Phone
Office Supplies & Postage
Payroll Expenses (Wages/Taxes/Service/WC Ins)
Professional Fees (CPA)
Network - CV Network 2,800.00
Network - Norton AntiVirus 417.49
Sub Total 408943.37
Advertising / Marketing
KESQ 10,990
KPSP 1695
Cycling West/Cycling Utah 1100
Banners & Signs
Apparel
Primal 35,557.00
Primal sold
T- shirts 19,913.00
T-shirts sold
Beer Garden/Pasta Dinner
Rentals 2,589.50 1004
Beer
Logistics
Rentals
RACES
Raffle
Rentals
Registration
Gifts
Rentals
Helmet stickers
Wristbands 345.8
Route Management
Walk & ride
Permits/Police Services
Rentals
Arrows
Ride with GPS
Permit - Riverside County 1521.93
Permit - City of Indio 922.31
Permit - City of Palm Springs 113000
Permit - City of Palm Springs Sponsorship -65,000
Permit - City of Palm Springs PS Resorts Sponsorship -40,000 1005 SAG
Rentals
Gas card
Food misc 0
Port-A-potties
Vendor Expo
Bike valet
Rental
Security 4,220.00
Diamond Porta Potties 5,716.40
Vol. Services / L&F/Info
Rentals
Sub total
Total of all committees
Cody and Tim Board budget (temp)
1006
CHP (2024) 20,457.52
Tim Funds 20,000.00
Advertising (2025) 50,000.00
Mistakes (2024) 20,000.00
USA cycling (2024) 20,000.00
Temp labor (3 months) 15,000.00
Admin (in case of event cancelation) 65,000.00
Appreciation party 2,000.00
City of Palm Springs 8,000.00
Bank Balanace Currently 030624
Total 220457.52
1007
1008
1009
1010
1011
1012
1013
1014
1015
1016
1017
1018
1019
1020
2024 Tour de Palm Springs in Coachella Valley
Economic Impact Survey
Background
5,173* surveys were sent out to all pre-registered event participants 911 surveys were returned (18%)
83% of the responders were visiting the CV
70% visiting the CV stayed overnight one or more nights *102/1,802;85/260;64/53;50/1,121;34/768;25/221;7/251;w/596 (miles/riders, w=walkers) Assumptions
The 18% of the registered participants who returned their surveys are proportionately representative of the remaining 82%.

Those responding to the survey who stayed overnight were predominately 34-102 mile riders.

Half of those reporting stays of 4+ days were TOT-exempt (30+ days).

Data

1. Number of nights stayed
1 - 19%
2 - 43%
3 - 15%
4+ 23%

2. Where stayed
61% Palm Springs
18% Palm Desert
5% Cathedral City
4% Indio
1021
3% Desert Hot Springs, La Quinta & “Other” (each)
2% Rancho Mirage

3. In what
43% Hotel
17% Private Home (non-TOT)
14% Air B&B
10% Motel
8% Vacation Rental
4% RV Park
4% Other

4. Total number in group
1 – 111 (15%) registered participant
2 – 349 (49%) registered participant plus one
3 – 56 (8%) registered participant plus two
4+ 201 (28%) registered participant plus three or more
Computations

1. Transient Occupancy Tax: 5,488 room nights in TOT-generating lodging averaging a daily room rate of $350 taxed @ 11% = $211,288 x 18% (PD) = $38,032.

2. Sales Tax: GPSCVB reported that the economic impact of visitors to the CV averages $509 per person per day. Subtracting $350 for the lodging component leaves $159 for dining, shopping, and attractions taxed at the PD rate of 7.75% = $12.32 per visitor per day. The estimated numbers of event participants and their parties staying over for 1, 2, 3, and 4+ nights was 420, 1372, 224, and 784. This equates to 420, 2,744, 672, and 3,136 days per visitor generating estimated sales tax totals = $102,488 x 18% (PD) = $7,645.

3. Total estimated PD TOT & sales tax generated by the 2024 Tour = $45,677. 1022

CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: August 22, 2024
PREPARED BY: Gary Shaffer, Director of Library Services SUBJECT: ESTABLISH THE PALM DESERT CITY FOUNDATION, A 501(C)(3)

NONPROFIT PUBLIC BENEFIT CORPORATION, DETERMINE BOARD

STRUCTURE, AND APPROVE DRAFT DOCUMENTS
RECOMMENDATION:

1. Authorize the City Manager to form a 501(c)(3) organization, named “Palm Desert City Foundation”, to support fundraising, initially for the library, with the ability to expand for other civic needs as they arise.

2. Provide direction on the Board’s membership and composition.

3. Authorize the City Manager to execute all necessary documents and make any nonsubstantive changes necessary to effectuate this action.

BACKGROUND:

The City has assumed local library services from the County of Riverside and its library operator LSS. Operations began on July 1, 2024. Many libraries have affiliated 501(c)(3) organizations that help with the funding of library programs and capital campaigns. Section 501(c)(3) is the portion of the US Internal Revenue Code that allows for federal tax exemption of nonprofit organizations that meet the code's requirements.

The proposed Palm Desert City Foundation (Foundation) will be specific to Palm Desert, focusing initially on major fundraising for the new library. The Foundation’s scope can later expand to include other City operations with fundraising or capital needs (e.g., public art, aquatic centers, fire stations, parks, and police stations) as they arise. Forming a 501(c)(3) organization will enable the City to seek donations and apply for foundation grants due to its tax-exempt status. While donations to the City are tax-deductible, if made exclusively for public purposes, the City is not classified as a 501(c)(3) tax-exempt organization, a requirement for many foundation grants.

Forming a 501(c)(3) would require specific legal and financial steps for incorporation, along with on-going reporting requirements. By approving this action, the City Manager will be authorized to proceed and implement this initiative promptly.

ANALYSIS:

City staff seeks City Council direction on the proposed Foundation Board’s membership and composition. To provide context, below is the board structures of two neighboring library foundations:

Rancho Mirage Library & Observatory Foundations:
 9 members consisting of 8 members of the public and the current Mayor.

Palm Springs Public Library Foundation:
 19 public members consisting of 4 executive members and 15 members at large. 1023
City of Palm Desert
Establish the Palm Desert City Foundation

Proposed Board Structure:

Although it is permissible for City Council members to serve on the Foundation Board, after consultation with the City Attorney’s Office, City staff does not recommend this approach because it does not provide enough separation between the two entities. Instead, City staff recommends the following Board structure:
 Five public members and two alternates, appointed by the City Council.  Two members of the City Council serve as liaisons to the Board.

In both options, the Foundation would be subject to the Brown Act since it is an entity created by the City. Draft bylaws and articles of incorporation are attached and will be modified based on the City Council’s direction.

Legal Review:

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

FINANCIAL IMPACT:

The costs associated with the formation are estimated not to exceed $10,000. These funds have been included in the approved FY 2024-25 Annual Budget in Library Services Account No. 2524662-4309000. There is no impact to the General Fund with this action.

ATTACHMENTS:

1. Palm Desert City Foundation Draft Bylaws

2. Palm Desert City Foundation Draft Articles of Incorporation 1024

BYLAWS OF

PALM DESERT CITY FOUNDATION
(A California Nonprofit Public Benefit Foundation)
ARTICLE I – Organization
Section 1. Name.

The name of this Foundation is Palm Desert City Foundation (“Foundation”).

Section 2. Objectives.

The Foundation has been formed to raise funds for and otherwise conduct or support programs and activities that benefit the shared public assets and amenities owned by the City of Palm Desert (“City”). These are, but not limited to, the City’s libraries, public art, aquatic centers, fire stations, parks, and police stations.

Section 3. Principal Office.

The principal office of the Foundation shall be fixed and located at the Palm Desert City Hall, located at 73-510 Fred Waring Drive, Palm Desert, California, 92260. The Board of Directors (“Board”) is hereby granted full power and authority to establish additional offices in other City-owned facilities. The Foundation shall be charged reasonable rent for said facilities.

Section 4. Members
The Foundation shall be maintained in accordance with Title 1, Division 2 of the California Foundations Code, otherwise known as the California Nonprofit Foundations Law (the “Law”).

The Foundation has elected not to have members as defined in section 5056 of the Law.

Section 5. Ralph M. Brown, Public Records and Political Reform Acts The Foundation is committed to ensuring that the deliberations of the Board are conducted openly, the actions of the Board are taken openly and all records of the Foundation are made available for public inspection in accordance with the Ralph M. Brown Act (“Brown Act”), California Government Code sections 54950 through 54963, as amended from time to time, the California Public Records Act (“'Public Records Act”), California Government Code sections 6250 through 6276.48, as amended from time to time, and the Political Reform Act of 1974 (the “Political Reform Act”), California Government Code sections 81600 through 9105, as amended from time to time. Accordingly, in the event of a conflict between a provision of these Bylaws and a section of the Brown Act, the Public Records Act or the Political Reform Act, the Brown Act or, as applicable, the Public Records Act or the Political Reform Act, shall control. 1025
BYLAWS – PAGE 2
ARTICLE II - Board of Directors
Section 1. Powers.

Subject to the limitations of the Articles of Incorporation and other provisions of these Bylaws, and the laws of the State of California, all corporate powers shall be exercised by, or under the authority of, and the business and affairs of the Foundation, shall be controlled by the Board.

Section 2. Number, Selection, and Terms of Office of Directors.

The Board shall consist of five (5) directors appointed by the City Council (“Directors”). The term of each Director shall be three (3) years or until a successor has been elected and qualified provided that two (2) of the initial Directors shall have an initial term of four (4) years. The initial distribution of terms may be accomplished voluntarily or by lot. Thereafter, the term of office shall be three (3) years. There shall be no limitation upon the number of consecutive terms to which a Director may be re-elected. Each Director, including a Director elected to fill a vacancy, shall hold office until the expiration of the term for which elected and until a successor has been elected and qualified. All vacancies on the Board including, without limitation, vacancies caused by expiration of a term, resignation or removal, including a demand resignation for failing to attend meetings, shall be appointed by the City Council.

Section 3. Vacancies.
(a) A vacancy or vacancies on the Board shall be deemed to exist (i) in case of the death, resignation, or removal of any director or (ii) if the authorized number of directors is increased. The Board may declare vacant the office of a Director who has been declared of unsound mind by a final order of court, or convicted of a felony, or found by a final order of judgment of any court to have breached any duty arising under section 5230 of the Law. A Director shall be deemed to have resigned if they accumulate unexcused absences amounting to at least one-half of the Board's regularly scheduled meetings during any fiscal year.
(b) Subject to the limitations of provision of section 5226 of the Law, any director may resign effective upon giving written notice to the Chair or the Secretary, of the Foundation and the Mayor or City Manager, unless the notice specifies a later time for the effectiveness of such resignation. If a director resigns by giving notice specifying that such resignation shall be effective at a future time, a successor may be designated by the City Council before such time to take office when the resignation becomes effective. (c) No reduction in the number of Directors shall have the effect of removing any Director prior to the expiration of their term of office.

Section 4. Removal of Directors.

Any Director may be removed from office, with or without cause, by the City Council, in accordance with sections 5222 and 5223, as applicable.
1026
BYLAWS – PAGE 3
ARTICLE III - Meetings of the Board
Section 1. Place of and Public Access to Meetings.

All meetings of the Board shall be held at the principal business office of the Foundation or at such other place within Palm Desert as may be designated from time to time by resolution of the Board, or in the notice of said meeting. All meetings of the Board shall be open and public and any member of the public shall be permitted to attend any meeting of the Board, except as otherwise provided in the Brown Act.

Section 2. Annual Meeting.

The annual meeting of the Board shall be the regular meeting of the Board held in May or June of each year. The officers of the Board shall be elected at this meeting for terms commencing July 1.

Section 3. Regular Meetings.

The Board shall hold regular meetings on the date(s) established by Board by resolution.

Notice of regular meetings shall be given in accordance with the Brown Act. The Board shall hold at least six (6) regular meetings during each fiscal year.

Section 4. Special Meetings.

Special meetings of the Board may be called at any time in accordance to the Brown Act.

Section 5. Agendas.

All agendas shall be prepared and posted as required by the Brown Act.

Section 6. Action at a Meeting; Quorum; Required Vote.

Presence of a majority of the Directors at a meeting of the Board constitutes a quorum for the transaction of business. Directors may participate in a meeting through use of a conference telephone, video conference or similar communications equipment pursuant to section 54953 of the Brown Act. Participation in a meeting as permitted in the preceding sentence constitutes presence in person at such meeting. Every act or decision done or made by a majority of the Directors present at a meeting duly held at which a quorum is present shall be regarded as the act of the Board unless a greater number, is required by law, or by these Bylaws. All votes taken during a meeting involving the expenditures of funds or an amendment to the Bylaws or Articles of Incorporation shall be by roll call and shall be reported in the minutes of the meeting. All other votes may be by voice vote unless otherwise required by these Bylaws or the Chair.

Section 7. Adjourned Meetings.

A quorum of the Directors may adjourn any Board meeting to meet again at a stated day and hour; provided, however, that in the absence of a quorum, a majority of the directors present at any Board meeting, either regular or special, may adjourn from time to time until the time fixed for the next regular meeting of the Board. Notice of an adjourned meeting shall be provided pursuant to the Brown Act.
1027
BYLAWS – PAGE 4
Section 8. Rights of Inspection.

The City Manager of the City, every Director, and every City Councilmember shall have the absolute right at any reasonable time to inspect and copy all books, records and documents of every kind, and to inspect the physical properties of the Foundation.

Section 9. Fees and Compensation.

The Directors shall receive no compensation for their service on the Board. However, Directors may be reimbursed for, or advanced funds for, any expenses actually incurred or reasonably expected to be incurred in connection with the performance of their duties as Directors.

ARTICLE IV - Officers
Section 1. Officers.

The officers of the Board shall be a Chair, a Vice Chair, a Secretary and a Treasurer. Two or more offices may be held by the same person except that neither the Secretary nor the Treasurer may serve concurrently as the Chair. The Chair and Vice Chair must also be Directors. The removal or resignation of a Director who is an officer of the Foundation shall be deemed a resignation by such person from all offices held.

Section 2. Nomination and Election.

The officers of the Foundation, shall be elected annually by the Board, at its annual meeting, and each officer so elected shall hold office until re-elected unless such officer shall resign, removed with or without cause, or otherwise becomes disqualified to serve, or until a successor shall be elected and qualified. At any regular or special meeting of the Board, the Board may fill a vacancy caused by the death, resignation, removal or disqualification of any officer.

Section 3. Removal and Resignation.

Any officer may be removed, either with or without cause, by the Board on a 2/3 vote or by the City Council on a majority vote, at any regular or special meeting of the respective bodies. Any officer may resign at any time by giving written notice to the Chair or Secretary of the Board and the Mayor or City Manager. Any such resignation shall take effect at the date of the receipt of such notice or at any later date specified therein; and unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.

Section 4. Chair of the Board.

The Chair of the Board shall preside at all meetings of the Board and exercise and perform such other powers and duties as may be from time to time assigned to the Chair by the Board or prescribed by these Bylaws. The duties of the Chair shall include the following:
(a) Scheduling meetings when necessary and conducting them in accordance with Robert's Rules of Order (or other such procedures duly adopted by the Board) and the requirements of the Brown Act.
(b) Setting meeting agendas in conjunction with the City Manager (or their designee) 1028
BYLAWS – PAGE 5
and ensuring adequate discussion of items;
(c) Keeping the Vice Chair and members of the Board, City Council, and City Manager informed on issues affecting the Foundation; and (d) On behalf of the Board and in conjunction with the City Manager, responding to issues from the Palm Desert community, private and public sectors, the City Council, and the media, or designating another member of the Board to represent the Foundation.

Section 5. Vice Chair.

In the absence of the Chair, the Vice Chair will exercise the duties of the Chair and shall perform such other duties as may be from time to time required by the Chair or by the Board.

Section 6. Secretary.

The Secretary shall record or cause to be recorded, and shall keep or cause to be kept, at the principal business office or such other place as the Board may order, a Minute Book of actions taken at all meetings of the Board, which must include, but is not limited to:
a) The time and place where each meeting was held;
b) Whether regular or special, and if special, how authorized, the notice thereof given, and the names of those present at Board meetings. The Secretary shall give, or cause to be given, notice of all the meetings of the Board required by the Bylaws or by law to be given, and shall have such other powers to perform such other duties as may be prescribed by the Board or by the Bylaws.

Section 7. Treasurer.

The Treasurer shall act as the Foundation’s chief financial officer, and shall keep and maintain, or cause to be maintained, adequate and correct accounts of the properties and business transactions of the Foundation, including accounts of its liabilities, receipts, disbursements, gains and losses. The Treasurer shall submit a statement of accounts at each regular meeting of the Board and shall make such reports as the Board may require, and shall make, an annual report prior to the annual meeting of the Board. The Treasurer shall cause to be deposited or shall cause to be disbursed in accordance with procedures approved by the Board all monies and other valuables in the name and to the credit of the Foundation with such depositories as may be designated by the Board. The Treasurer shall disburse funds of the Foundation as may be ordered by the Board, shall render to the Chair of the Board, the City Manager, the City Council, and the Board, whenever they request, an account of all transactions as Treasurer and of the financial condition of the Foundation, and shall have such other powers and perform such other duties as may be prescribed by the Board or these Bylaws. 1029
BYLAWS – PAGE 6
ARTICLE V - Committees
Section 1. Committees.
a) The Board may, by resolution adopted by a majority of the Directors then in office, provided that a quorum is present, establish one or more committees consisting of at least a majority of directors of the Board plus any other person or persons. Members of all committees shall be appointed by the Board. Members of all committees shall serve at the pleasure of the Board.
b) The Board shall have the power to prescribe the manner in which proceedings of any committee shall be conducted. In the absence of any such prescription, such committee shall have the power to prescribe the manner in which its proceedings shall be conducted.

Unless these Bylaws, the Board or such committee shall otherwise provide, the regular and special meetings and other actions of any committee shall be governed by the provisions of this Article applicable to meetings and actions of the Board which shall be subject to the Brown Act. Each committee shall keep regular minutes of its proceedings and shall report the same to the Board from time to time, as the Board may require.

Section 2. Alternates.

The Board may designate one or more Directors as alternate members of any such committee, who may replace any absent member at any meeting of the committee.

Section 3. Standing Committees.

The Board may create standing committees consisting of two or more directors of the Board that have continuing subject matter jurisdiction over a particular issue. Each such standing committee shall establish its rules for the conduct of its affairs, shall establish its duties and purposes, and shall perform such other duties as the Board may prescribe from time to time.

Section 4. Special Advisory Committees.

From time to time, the Chair of the Board may appoint one or more special advisory committees consisting of less than a majority of the Board for purposes of considering specific matters of concerns of the Board for a temporary period of time.

Section 5. Term of Office.

Each member of a committee shall serve until their successor is appointed, or until such committee is sooner terminated, or until they are removed, resigns, or otherwise ceases to qualify as a member of the committee.

Section 6. Quorum; Meetings.

Each committee, standing committee and special advisory committee shall meet as often as necessary to perform its duties, at such times and places as directed by the committee chair, the Chair of the Board or the Board and, if applicable, in compliance with the Brown Act. A majority of the members of any of the above committees (except special advisory committees) shall constitute a quorum of such committee and the act of a majority of the members present at a meeting at which a quorum is present shall be the act of the committee. Each of the above 1030
BYLAWS – PAGE 7
committee (excepting special advisory committees) shall keep accurate minutes of its meetings, the chair designating a secretary of the committee for this purpose, and shall make periodic reports and recommendations to the Board.

Section 7. Vacancies.

Vacancies on any committee may be filled for the unexpired portion of the term in the same manner as provided in the case of original appointments.

Section 8. Conflict of Interest.

The Board shall adopt a Conflict of Interest Policy as required by Article VII, Section 5 of these Bylaws which shall be enforced by a committee designated for that purpose. Each Director shall, not less frequently than once a year, submit a statement setting forth all business and other affiliations which relate in any way to the business of the Foundation. Each director shall be responsible for disclosing to the Foundation any matter which would make such director an ''interested director” within the meaning of section 5233 of the Law. In addition, each director shall disclose to the Foundation any relationship or other factor which would cause that director to be considered to be an “interested person” within the meaning of section 5227 of the Law.

Section 9. Limitation on Delegation.

The Board may not delegate to its committees any legal authority that under the Law can only be exercised by the full Board.

ARTICLE VI - Indemnification and Insurance
Section 1. Right of Indemnity.

To the fullest extent permitted by law, this Foundation shall indemnify its directors, officers, employees, and other persons described in section 5238(a) of the Law, including persons formerly occupying any such position, against all expenses, judgments, fines, settlements and other amounts actually and reasonably incurred by them in connection with any ''proceeding,” as that term is used in that section, including an action by or in the right of the Foundation, by reason of the fact that the person is or was a person described in that section. “Expenses,” as used in this Bylaw, shall have the same meaning as in section 5238(a) of the Law.

Section 2. Approval of Indemnity.

On written request to the Board by any person seeking indemnification under section 5238 (b) or section 5238 (c) of the Law, the Board shall promptly determine under section 5238(e) of the Law whether the applicable standard of conduct set forth in section 5238(b) has been met and, if so, the Board shall authorize indemnification.

Section 3. Advancing Expenses.

To the fullest extent permitted by law and except as otherwise determined by the Board in a specific instance, expenses incurred by a person seeking indemnification under Sections 1 and 2 of these Bylaws in defending any proceeding covered by those sections shall be advanced by the Foundation before final disposition of the proceeding, on receipt by the Foundation of an 1031
BYLAWS – PAGE 8
undertaking by or on behalf of that person that the advance will be repaid unless it is ultimately determined by the Board, that the person is entitled to indemnification by the Foundation for those expenses, and on receipt by the Foundation of such security as the Board may deem appropriate.

Section 4. Insurance.

The Board may adopt a resolution authorizing the purchase and maintenance of insurance on behalf of any agent of the Foundation against any liability asserted against or incurred by the agent in such capacity or arising out of the agent's status as such, whether or not the Foundation would have the power to indemnify the agent against that liability under the provisions of this Article.

ARTICLE VII - General Provisions
Section 1. Checks, Drafts, Etc.

All checks, drafts or other orders for payment of money, notes or other evidences of indebtedness, issued in the name of or payable to the Foundation, and any and all securities owned or held by the Foundation requiring signature for transfer, shall be signed or endorsed by such person or persons and in such manner as, from time to time, shall be determined by the Board.

Section 2. Inspection of Corporate Records.

The Foundation shall keep at its principal business office, the originals or copies of its Articles of Incorporation and Bylaws, as amended or otherwise altered to date, certified by its Secretary; written minutes of the meetings of its Board, and any committees of the Board; its books and records of account; and all other books, records and documents of the Foundation.

Section 3. Endorsement of Documents; Contracts.

Any note, mortgage, evidence of indebtedness, contract, conveyance or other instrument in writing, and any assignment or endorsement thereof executed or entered into between the Foundation and any other person, when signed by the Chair, the Secretary, or the Treasurer, shall be valid and binding on the Foundation in the absence of actual knowledge on the part of the other person that the signing officer(s) had no authority to execute the same. Any such instrument may be signed by any other officers, agents or employees and in such manner as shall from time to time be determined by the Board and, unless so authorized by the Board no officer, agent or employee shall have any power or authority to bind the Foundation by any contract or engagement or to pledge its credit or to render it liable for any purpose or amount.

Section 4. Annual Report.

The Foundation shall furnish annually to the City Council, the City Manager, and each Director within a reasonable period of time not to exceed 210 days after the close of its fiscal year, a written report containing the following information in reasonable detail:
a) The assets and liabilities, including the trust funds, of the Foundation as of the end 1032
BYLAWS – PAGE 9
of the fiscal year.
b) The principal changes in the assets and liabilities, including trust funds, during the fiscal year.
c) The revenue or receipts of the Foundation, both unrestricted and restricted to particular purposes, for the fiscal year.
d) The expenses or disbursements of the Foundation, for both general and restricted purposes, during the fiscal year.
e) Any information required by section 6322 of the Law, as from time to time amended.

Section 5. Conflict of Interest.

The Foundation. through the Board, shall promulgate, from time to time. a written conflict of interest policy, according to the current law then in effect, including section 87100 of the California Government Code, to be adhered to by its officer and directors, and which includes guidelines for the resolution of actual or potential conflicts of interest.

Section 6. Fiscal Year.

The fiscal or business year of the Foundation shall be July 1 of the current year through June 30 of the subsequent year.

Section 7. Construction and Definitions.

Unless the context otherwise requires, the general provisions, rules of construction and definitions contained in the general provisions of the Law shall govern the construction of these Bylaws.

ARTICLE VIII - Amendments and Dissolution
Section 1. Amendment.

New bylaws may be adopted, or these Bylaws may be amended, modified or repealed by the Board provided, however, that any proposed amendment shall require the prior approval of the City Council before it shall become effective.

Section 2. Record of Amendments.

Any amendment or alteration in these Bylaws shall be forthwith filed with the original Bylaws of the Foundation.

Section 3. Dissolution.

The Corporation shall not be voluntarily dissolved, except by approval of the Board subject to approval by the City Council. In the event of dissolution of the Corporation in any manner and for any cause, after the payment or adequate provision for the payment of all of its debts and liabilities, all of the remaining funds, assets and properties of the Corporation shall be paid or distributed as provided for in the Articles of Incorporation. 1033
BYLAWS – PAGE 10

CERTIFICATE OF SECRETARY

BYLAWS OF

PALM DESERT PUBLIC TRUST
I, the undersigned, do hereby certify:
1) That I am the duly elected and acting secretary of the Palm Desert Public Trust. a California nonprofit public benefit corporation; and
2) That the foregoing Bylaws, consisting of nine (9) pages, exclusive of cover sheet and table of contents, constitute the Bylaws of said corporation as duly adopted by the Incorporator on _______, 2024.

IN WITNESS WHEREOF, I have executed this Certificate as of this __ day of ______, 2024. _____________________ , Secretary
1034

ARTICLES OF INCORPORATION
OF

PALM DESERT CITY FOUNDATION

ARTICLE I
NAME
The name of this corporation is Palm Desert City Foundation (“Corporation”).

ARTICLE II

PURPOSES
A. This Corporation is a nonprofit public benefit organization and is not organized for the private gain of any person. It is organized under the Nonprofit Public Benefit Corporation Law exclusively ford charitable purposes.

B. The specific charitable purpose of the Corporation are to: (1) to aid, sponsor, promote, advance and assist in the provision, development and maintenance of facilities, public parks, recreation, and community programs and services in the City of Palm Desert (“City”) for the benefit of its residents; (2) to engage in any other activities in furtherance of the purposes for which the Corporation is formed; and (3) to receive, invest and utilize funds, property and in-kind materials or services acquired through the solicitation of contributions, donations, grants, gifts, bequests and the like for the purposes for which the Corporation is formed.

ARTICLE III

INITIAL AGENT FOR SERVICE OF PROCESS
The name and address in the State of California of this Corporation's initial agent for service of process is:

Isabel C. Safie
Best Best & Krieger LLP
2855 E. Guasti Road, Ste 400
Ontario, California 91761

ARTICLE IV

INITIAL STREET AND MAILING ADDRESS
The initial street and mailing address of the corporation is:
73510 Fred Waring Drive
Palm Desert, CA 92260
1035

ARTICLE V

LIMITATION OF CORPORATE ACTIVITIES
A. This corporation is organized and operated exclusively for charitable purposes within the meaning of Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (“Code”).

B. Notwithstanding any other provision of these Articles of Incorporation, the Corporation shall not, except to an insubstantial degree, engage in any activities or exercise any powers that do not further the purposes of the corporation, and the corporation shall not carry on any other activities not permitted to be carried on by (a) a corporation exempt from federal income tax under Section 501(c)(3) of the Code or (b) a corporation, contributions to which are deductible under Section 170(c)(2) of the Code.

C. No substantial part of the activities of this Corporation shall consist of lobbying or carrying on propaganda, or otherwise attempting to influence legislation, and the Corporation shall not participate or intervene in (including the publication or distribution of statements) any political campaign on behalf of, or in opposition to, any candidate for public office.

ARTICLE VI

DEDICATION AND DISSOLUTION
A. The property of this Corporation is irrevocably dedicated to charitable purposes and no part of the net income or assets of this Corporation shall ever inure to the benefit of any director, officer or member thereof, or to the benefit of any private persons.

B. Upon the dissolution or winding up of the corporation, and after paying or adequately providing for its debts and obligations, the remaining assets of the corporation shall be distributed to the City, and be used exclusively for the purposes for which the Corporation was established. If the City waives receipt of such assets, then remaining assets of the Corporation shall be distributed to a nonprofit fund, foundation or corporation which is organized and operated exclusively for charitable purposes and which has established and maintained its tax-exempt status under Section 501(c)(3) of the Code, provided such assets are used for the purposes for which the Corporation was established.

C. If the Corporation holds any assets in trust then such assets shall be disposed of on dissolution in conformity with these Articles of Incorporation or the bylaws for the Corporation subject to complying with the provisions of any trust under which such assets are held. The disposition shall be in such manner as may be directed by decree of the Superior Court of the county in which the Corporation has its principal offices, on petition therefor by the Attorney General or by any person concerned in the liquidation, in a proceeding to which the Attorney General is as party. Such decree of the Superior Court may be waived if the Attorney General makes a written waiver of objections to the disposition. 1036

ARTICLE VII

AMENDMENT
Any amendment, modification, or repeal of these articles may become effective only upon ratification by the City Council of the City of Palm Desert.

Date: June ____, 2024.
______________________________
ISABEL C. SAFIE
Incorporator
1037
1038

CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: August 22, 2024
PREPARED BY: Eric Ceja, Director of Economic Development SUBJECT: THIRD AMENDMENT TO THE SECOND REVISED AND RESTATED

DISPOSITION AND DEVELOPMENT AGREEMENT BETWEEN THE CITY

OF PALM DESERT AND DESERT WAVE VENTURES, LLC
RECOMMENDATION:

1. Approve the Third Amendment to the Second Revised and Restated Disposition and Development Agreement between the City of Palm Desert and Desert Wave Ventures, LLC.

2. Authorize the City Attorney to make any necessary nonmonetary changes to the agreement.

3. Authorize the City Manager to execute the agreement.

BACKGROUND/ANALYSIS:

Originally approved in 2019, the DSRT Surf project includes the construction of a 5.5-acre surf lagoon, up to 88 villa units, and associated amenities at the Desert Willow Golf Resort. In May 2024, the project broke ground with an anticipated construction schedule of 24 months. As the project timelines have evolved, it has become necessary to revise the conditions set forth in the original Disposition and Development Agreement (DDA). To date, the City has approved the following revisions:
 Revised and Restated DDA (2022): Acknowledged changes in the project scope.  First Amendment to the Second Revised and Restated DDA (2023): Removed the requirement to construct a hotel, included an annual payment of $500,000 with 3% annual increases for the life of the project to the City, and removed all City-provided financial assistance.
 Second Amendment to the Second Revised and Restated DDA (2024): Added provisions for the developer to remedy non-performance in construction activities at the site.

Desert Wave Ventures, LLC, has expressed a desire to replace the City’s requirement to submit bonds for site remediation in the unlikely event that the development stalls. To remove the bond requirement the developers have agreed to supply the City with a $3,000,000 security instrument, which may include a bond, letter of credit, or cash deposit, for the same purpose.

The $3,000,000 security instrument is valued at the same amount as the City’s bond requirement and the $3,000,000 remediation costs are based on an engineering assessment for site remediation. Whether it is a bond or another security instrument, the City is protected and will have sufficient funds available to remediate the site.

Additionally, due to ongoing construction activities and impacts to the surrounding road network, the City is requesting that the developer provide $100,000 by January 15, 2025, for a future slurry seal and repair project for both Desert Willow Drive and Market Place Drive. The amount 1039
City of Palm Desert
Third Amendment to the Second Revised and Restated DDA

requested is based on an engineering estimate to repair the streets to pre-construction conditions.

Legal Review:

This report has been reviewed by Robert Messinger with Burke, Williams and Sorensen (BWS), special counsel to the City for the DSRT Surf project.

FINANCIAL IMPACT:

With approval of this DDA, the City will receive a $3,000,000 security instrument in lieu of a Faithful Performance Bond and $100,000 for repair to Desert Willow Drive and Market Place Drive, from Desert Wave Ventures, LLC. There are no direct impacts to the City’s General Fund as a result of this approval.

ATTACHMENT:

Third Amendment to the Second Revised and Restated Disposition and Development Agreement 1040

THIRD AMENDMENT TO SECOND REVISED AND RESTATED

DISPOSITION AND DEVELOPMENT AGREEMENT
Surf Lagoon, Surf Center, and Residential Units Project This Third Amendment to Second Revised and Restated Disposition and Development Agreement (this “Third Amendment”) is entered into as of August 22, 2024, by and between the CITY OF PALM DESERT, a chartered municipal corporation (the “City”), and DESERT WAVE VENTURES, LLC, a Delaware limited liability company (the “Developer”). The City and Developer are the sole parties (each, a “Party” and, collectively, the “Parties”) to this Agreement.

RECITALS
This Agreement is based upon the following recitals, facts and understandings of the Parties:

A. The City and Developer entered into that certain Disposition and Development Agreement, dated December 30, 2019 (the “Original DDA”). The City and Developer subsequently entered into that certain Revised and Restated Disposition and Development Agreement, dated April 22, 2022 (the “First Revised DDA”). The Parties subsequently entered into that certain Second Revised and Restated Disposition and Development Agreement, dated November 17, 2022 (the “Second Revised DDA”), which completely superseded both the Original DDA and the First Revised DDA. The Parties subsequently entered into that certain First Amendment to the Second Revised and Restated Disposition and Development Agreement, dated May 25, 2023 (the “First Amendment”) and that certain Second Amendment to the Second Revised and Restated Disposition and Development Agreement, dated January 11, 2024 (the “Second Amendment”). The Second Revised DDA, as amended by the First Amendment and the Second Amendment is referred to herein as the “DDA.” The Parties now intend to further amend the DDA with this Third Amendment.

B. The City has previously conveyed 3.03 acres of real property (APNs 620- 400-008 & 620-420-024) (the “City Property”) to Developer by a grant deed (“City Grant Deed”) pursuant to that certain Purchase Option Agreement dated August 15, 2018, and the Successor Agency to the Redevelopment Agency of the City of Palm Desert (“SARDA”) previously conveyed 14.65 acres of real property (APN 620-420-023) (the “SARDA Property”) to Developer by a grant deed (“SARDA Grant Deed”) pursuant to that certain Purchase Option Agreement dated August 15, 2018, as amended by the First Amendment to Real Estate Option and Purchase and Sale Agreement dated May 22, 2021. The City Grant Deed and the SARDA Grant Deed are referred to herein, collectively, as the “Deed of Sale.” Collectively, the City Property and the SARDA Property make up the project site (“Project Site”).

C. Pursuant to the DDA, Developer will construct improvements on the Project Site in two phases as set forth in the “Scope of Development” (Attachment No. 1 to the DDA). In the first phase, Developer will construct an approximately 5.5-acre Surf Lagoon; 1041
-2-
an approximately 6,200 square foot Surf Center, inclusive of a food and beverage component, on-site parking, and 57 residential lots with all utilities stubbed to the site; the second phase will include 57 private residential units (the “Residential Units”) and associated amenities. (Together all improvements at the Project Site are referred to as the “Project”.)
D. The Parties now desire to amend the DDA provisions relating to the security for the construction of the Project. All capitalized terms not defined within this Agreement shall have the meanings ascribed to such terms in the DDA.

AGREEMENTS
For valuable consideration, receipt of which is hereby acknowledged, and the mutual obligations of and benefits to the Parties set forth herein, the City and Developer agree as follows:

1. Incorporation of Recitals. The parties agree that the Recitals constitute the factual basis upon which the City and the Developer have entered into this Third Amendment. The City and the Developer each acknowledge the accuracy of the Recitals and agree that the Recitals are incorporated into this Agreement as though fully set forth at length.

2. Security Amendment. Section 4.10 of the DDA is hereby amended to read as follows:

4.10 Security.
(a) Required Security. At the time Developer executes the Third Amendment, Developer shall furnish to City the following bonds, letters of credit, instruments of credit (assignment of deposit account) or other security acceptable to City in its sole and absolute discretion and satisfying the requirements of the applicable provisions of this Section 4.10 below (hereinafter “Security Instrument”):
(i) A Security Instrument securing Developer’s faithful performance of all of the Works of Improvement (“Faithful Performance Security Instrument”), in the amount of $3,000,000 equal to 100% of the estimated Project Site restoration costs.

This Agreement shall not be effective for any purpose until such Security Instruments are supplied to and approved by City in accordance herewith. (b) Form of Security Instrument. The Security Instrument shall be in the amount required under Section 4.10 (a) shall meet the following minimum requirements and otherwise shall be in a form provided by City or otherwise approved by the City Attorney:
(i) Bond. For a Security Instrument provided in the form of a bond, any such bond must be issued and executed by an insurance company or bank authorized to transact surety business in the State of California. Any insurance company 1042
-3-
acting as surety shall have a minimum rating of A-IX, as rated by the current edition of Best’s Key Rating Guide published by A.M. Best’s Company, Oldwick, New Jersey, 08858. Any bank acting as surety shall have a minimum rating of AA, as rated by Moody’s or Standard & Poor’s.
(ii) Letters of Credit. For a Security Instrument which is a letter of credit, any letter of credit shall be an original separate unconditional, irrevocable, negotiable and transferable commercial letter of credit issued by a financial institution with offices in the State of California acceptable to City. Any such letter of credit shall specifically permit City to draw on same by unilateral certification of the City Engineer of the City that Developer is in default under its performance obligations hereunder or in the event Developer fails to deliver a replacement letter of credit not less than thirty (30) days prior to the date of expiration of any such letter of credit. (iii) Instrument of Credit. For Security Instruments which are Instruments of Credit, any Instrument of Credit shall be an assignment of deposit account assigning as security to City all of Developer’s interest in funds on deposit in one or more bank accounts with financial institutions acceptable to City. (c) General Requirements for all Security Instruments.
(i) Payments under any Security Instrument shall be required to be made (and, with respect to bonds, litigation shall be required to be instituted and maintained) in the County of Riverside, State of California (and the Security Instrument shall so provide).
(ii) The Security Instrument shall have a minimum term of one (1) year after the deadline for Developer’s completing the Project (other than Instruments of Credit, which shall have no defined term or expiration date). (iii) The Security Instrument shall provide that changes may be made in the Project pursuant to the terms of this Agreement without notice to any issuer or surety and without affecting the obligations under such Security Instrument. (iv) If the Developer seeks to replace any security with another security, the replacement shall: (1) comply with all the requirements for security in this Agreement; (2) be provided by the Developer to the City Engineer; and (3) upon its written acceptance by the City Engineer, be deemed a part of this Agreement. Upon the City Engineer’s acceptance of a replacement security, the former security may be released by the City.
(d) Developer’s Liability. While no action of Developer shall be required in order for City to realize on its security under any Security Instrument, Developer agrees to cooperate with City to facilitate City’s realization under any Security Instrument, and to take no action to prevent City from such realization of any Security Instrument.

Notwithstanding the giving of any Security Instrument or the subsequent expiration of any Security Instrument or any failure by any surety or financial institution to perform its obligations with respect thereto, Developer shall be personally liable for performance 1043
-4-
under this Agreement and for payment of the cost of the labor and materials for the Project to be constructed or installed hereby and shall, within ten (10) days after written demand therefor, deliver to City such substitute security as City shall require satisfying the requirements in this Section 4.10.
(e) Letters of Credit.
(i) In the event a letter of credit is given pursuant to Section

4.10(b)(ii), City shall be entitled to draw on any such letter of credit if a replacement letter of credit (expiring in not less than one (1) year, unless City agrees to a lesser term in City’s sole and absolute discretion) is not delivered not less than thirty (30) days prior to the expiration of the original letter of credit, such substitute letter of credit being in the same amount and having the terms and conditions as the initial letter of credit delivered hereunder, issued by a financial institution acceptable to City as of the date of delivery of the replacement letter of credit.
(ii) In the event of draw by the City on a letter of credit, the City may elect, in its sole and absolute discretion, to apply any such funds drawn to the obligations secured by such letter of credit or to hold such funds in an account under the control of the City, with no interest accruing thereon for the benefit of the Developer. If the City elects to hold the funds in an account pursuant to the foregoing, City may thereafter at any time elect instead to apply such funds as provided in the foregoing.

Developer agrees and hereby grants City a security interest in such account to the extent required for City to realize on its interests therein, and agrees to execute and deliver to City any other documents requested by City in order to evidence the creation and perfection of City’s security interest in such account. (f) Release of Security Instrument. The City shall release the Security Instrument as follows:
(i) City shall release the Faithful Performance Security Instrument and Labor and Materials Security Instrument when all of the following have occurred:

A. Developer has made written request for release and
provided evidence of satisfaction of all other requirements in this Agreement; B. The City may retain from any security released, an
amount sufficient to cover costs and reasonable expenses and fees, including reasonable attorney’s fees.

3. Payment for Street Repair. A new Subsection 5.3(c) to the DDA is added to read as follows:
(c) On or before January 15, 2025, Developer shall make a cash payment to City in the amount of One Hundred Thousand and 00/100 Dollars ($100,000.00) for the purpose of paying for repairs to Desert Willow Drive and Market 1044
-5-
Place Drive arising in part from the construction activities associated with the Project.

Such repairs will be made by the City upon completion of the Project.

4. Counterparts. This Third Amendment may be executed in counterparts which taken together shall constitute one agreement.

5. Incorporation by Reference of Recitals. The Recitals are hereby incorporated into this Agreement by reference as if set forth herein in full. (SIGNATURES ON FOLLOWING PAGE)
1045
-6-

THIRD AMENDMENT TO SECOND REVISED AND RESTATED

DISPOSITION AND DEVELOPMENT AGREEMENT
DSRT Surf Lagoon and Surf Center, and Residential Units Project Signatory Page
CITY:

Date: August 22, 2024
CITY OF PALM DESERT, a charter city
and municipal corporation
By:_____________________________
L. TODD HILEMAN

CITY MANAGER
APPROVED AS TO FORM:

By:___________________________

ISRA SHAH

CITY ATTORNEY
1046
-7-

THIRD AMENDMENT TO SECOND REVISED AND RESTATED

DISPOSITION AND DEVELOPMENT AGREEMENT
DSRT Surf Lagoon, Surf Center, and Residential Units Project Signatory Page
DEVELOPER:

Date: _________________ 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: ____________________________

JUSTIN WHITE

COUNSEL
1047

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 _____________________________
1048

CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: August 22, 2024
PREPARED BY: Nick Melloni, AICP, Principal Planner
SUBJECT: ESTABLISHMENT OF ANNUAL LEASE RATE FOR DINING DECKS AND

LICENSING REQUIREMENTS FOR USE OF PUBLIC RIGHT-OF-WAY

FOR OUTDOOR DINING DECKS
RECOMMENDATION:

Continue the Public Hearing to a date uncertain.

BACKGROUND/ANALYSIS:

A public hearing notice was posted for this item. City staff is requesting the City Council continue this item to a future meeting. A new public hearing notice will be posted prior to the request returning to the City Council for consideration.

ATTACHMENTS:

1. Public Hearing Notice
1049
1050

C I T Y O F P A L M D E S E R T
73-510 FRED WARING DRIVE
PALM DESERT, CALIFORNIA 92260-2578
TEL: 760-346-0611
[email protected]

CITY OF PALM DESERT

PUBLIC HEARING NOTICE

NOTICE IS HEREBY GIVEN THAT A PUBLIC HEARING WILL BE HELD BEFORE THE CITY

COUNCIL OF THE CITY OF PALM DESERT, CALIFORNIA, TO CONSIDER ADOPTING AN

ANNUAL LEASE RATE FOR DINING DECKS AND LICENSING REQUIREMENTS FOR USE

OF PUBLIC RIGHT-OF-WAY FOR OUTDOOR DINING DECKS
The City of Palm Desert (City), in its capacity as the Lead Agency for this project and pursuant to the California Environmental Quality Act (CEQA), has determined the action is not a “Project” as defined by CEQA Guidelines Section 15378(b)(4).

PROJECT LOCATION: Citywide
PROJECT DESCRIPTION: The item is to be considered is an action to adopt an annual lease rate and license agreement requirements for existing temporary outdoor dining decks to use the public-right-of-way.

PUBLIC HEARING: NOTICE IS HEREBY GIVEN that the City Council of the City of Palm Desert, California, will hold a Public Hearing on Thursday, August 22, 2024. The City Council meeting begins at 4:00 p.m. in the Council Chamber at 73510 Fred Waring Drive, Palm Desert, California.

Pursuant to Assembly Bill 2449, this meeting may be conducted as a hybrid meeting, allowing public access via teleconference or in person. Options for remote participation will be listed on the Posted Agenda for the meeting at: https://www.palmdesert.gov/our-city/mayor-and-citycouncil-/city-council-meeting-information-center REVIEW OF PROJECT INFORMATION: Information concerning the proposed lease rate and licensing requires is available for review in the Office of the City Clerk at 73510 Fred Waring Drive, Palm Desert, California during regular business hours and on the City’s website at https://www.palmdesert.gov/our-city/mayor-and-city-council-/city-council-meeting-informationcenter COMMENT ON THIS APPLICATION: Response to this notice may be made as follows:

Written comments may be submitted to the City Council by letter to the address below or email at [email protected]. Transmittal prior to the start of the meeting is required. Any correspondence received during or after the meeting will be distributed to the City Council as soon as practicable and retained for the official record.

Any challenge of the proposed project in court may be limited to raising only those issues raised at the public hearing described in this notice, or in written correspondence delivered to the City Clerk at, or prior, to the public hearing. (Government Code Section 65009[b][2]).

Si necesita ayuda con esta notificación, por favor llame a la Ciudad de Palm Desert y comuníquese con Gloria Sanchez (760) 346-0611 ext. 354
PUBLISH: THE DESERT SUN ANTHONY J. MEJIA, MMC, CITY CLERK August 9, 2024 and CITY OF PALM DESERT, CALIFORNIA
August 16, 2024
1051
1052

CITY OF PALM DESERT

STAFF REPORT
MEETING DATE: August 22, 2024
PREPARED BY: Richard D. Cannone, AICP, Director of Development Services SUBJECT: RESOLUTION UPDATING THE FEES FOR DOG LICENSES
RECOMMENDATION:

Adopt a resolution entitled, “A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM DESERT, CALIFORNIA, UPDATING THE FEES FOR DOG LICENSES.” BACKGROUND/ANALYSIS:

At the March 28, 2024, City Council Study Session, staff provided an overview of the Animal Services Contract with Riverside County Department of Animal Services (RCDAS). One key consideration discussed was increasing the fee for dog licensing. Palm Desert Municipal Code (PDMC) Section 6.08.040 establishes that if a fee is not adopted, it should be the same amount for similar dog licensing in the unincorporated areas of Riverside County. The current fee, established in 1998, has not been updated since then and includes the following:

License type 1 Year 2 Year 3 Year
Altered Dog $8 $15 $19
Unaltered Dog $50 $100 $150
Altered Dog, Senior Citizen 60+ $6 $7 $8
RCDAS issues dog licenses and collects fees on behalf of the City, and retains a processing fee of $11.92 per license for this fiscal year. Any remainder is credited back to the City on the monthly invoice. City staff recommends increasing dog licensing fees to cover the $11.92 processing fee retained by RCDAS. Please refer to the table below for the proposed fees.

License Type 1 Year 2 Year 3 Year(1)
Altered Dog
Palm Desert
Unc. Riverside County
$15
$25
$20
$50
$22
$75
Unaltered Dog
Palm Desert
Unc. Riverside County
$120
$120
$240
$240
$360
$360
Altered Dog, Senior Citizen 60+
Palm Desert
Unc. Riverside County
$12
$12
$13
$24
$14
$36
(1) A three-year license is only available for dogs that have attained the age of 12 months or older and have been vaccinated. In any event no license period may extend beyond the remaining period of validity for the current rabies vaccination. (Gov’t. Code, § 38792(b).)
1053
City of Palm Desert
Dog License Fee

For comparison, the current dog licensing fees for unincorporated areas of Riverside County are provided. With the exception of Unaltered Dogs and the one-year license for Altered Dogs owned by Senior Citizens aged 60 and over (where the fees align with unincorporated Riverside County rates), our proposed fees will remain at least 40% lower than the RCDAS fees. Additionally, as provided at the March 28, 2024 Study Session the proposed licensing fees are one of the lowest among the Coachella Vally municipalities that contract with RCDAS, as shown below. With the exception of Rancho Mirage (1998 RCDAS fees), Palm Desert will have the lowest license rates for multi-year licenses.

License Type 1 Year 2 Year 3 Year
Altered Dog
Palm Desert
Cathedral City
Coachella
Indian Wells
Indio
La Quinta
Rancho Mirage
$15
$25
$17
$21
$17
$17
$8
$20
$50
$34
$38
$26
$34
$15
$22
$75
$49
$53
$36
$49
$19
Unaltered Dog
Palm Desert
Cathedral City
Coachella
Indian Wells
Indio
La Quinta
Rancho Mirage
$120
$120
$100
$104
$100
$100
$50
$240
$240
$200
$204
$175
$200
$100
$360
$360
$300
$304
$225
$300
$150
Altered Dog, Senior Citizen 60+
Palm Desert
Cathedral City
Coachella
Indian Wells
Indio
La Quinta (55+)
Rancho Mirage
$12
$12
$12
$16
$10
$12
$6
$13
$24
$24
$28
$15
$24
$7
$14
$36
$36
$40
$20
$36
$8
Legal Review:

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

FINANCIAL IMPACT:

The proposed increase in fees will help further reduce the monthly charges of the Animal Services Contract with RCDAS. For Fiscal Year 2023-24, the average monthly credit the City received was approximately $950.

ATTACHMENTS:
1054
City of Palm Desert
Dog License Fee

1. Draft Resolution
1055
1056
RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALM

DESERT, CALIFORNIA, UPDATING THE FEES FOR DOG LICENSES
WHEREAS, the City of Palm Desert (the “City”) contracts with the Riverside County Department of Animal Services (“RCDAS”) for animal control services (the “Contract”). The most recent Contract with RCDAS was approved on July 11, 2024, and will terminate on June 30, 2025. Under the Contract, RCDAS provides the following services for the City: kennel services, dog license processing, dead animal disposal, field enforcement, and other services related to animal control; and WHEREAS, the City Council has determined providing animal control services is a necessary and vital service required for the preservation of public health, safety, and welfare of City residents; and
WHEREAS, the City incurs certain costs associated with providing the administration of animal control services and the RCDAS Contract, which is on file in the City Clerk’s office available for inspection during normal business hours of the City, and is incorporated herein by this reference; and
WHEREAS, pursuant to Government Code Section 38792, the City Council has the authority to collect a license fee for dogs; and
WHEREAS, pursuant to Section 6.08.040 of the Palm Desert Municipal Code (“Code”), the City’s dog licensing fee schedule (“License Fees”) has not been updated since 1998, and the City has determined that the current License Fee is insufficient to cover the costs associated with the RCDAS Contract and related administration costs; and WHEREAS, the City Council desires to update the License Fees to allow the City to recover a portion of the costs incurred related to the Contract and in administering services related to dogs, including animal sheltering and control; and WHEREAS, prior to increasing the License Fees the City is required to hold a noticed public hearing at which oral and written presentations can be made and heard; and WHEREAS, notices of said public hearing were made at the time and in the manner required by law; and
WHEREAS, the City Council now desires to approve the proposed License Fees.

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

SECTION 1. That the foregoing recitals are true and correct and are incorporated herein as substantive findings of this Resolution.
1057
Resolution No. 2024- ____
SECTION 2. The City Council finds that the costs associated with the Contract and administration of animal control services within the City imposes certain costs upon the City and the proposed License Fees recover only a portion of such costs and in no event does such Licensing Fees exceed the costs incurred by the City.

SECTION 3. Effective immediately following the approval of this Resolution, the City Council hereby establishes the following annual License Fees:

License Type 1 Year 2 Year 3 Year(1)
Altered dog $15 $20 $22
Unaltered Dog $120 $240 $360
Altered Dog, owned by Senior Citizen 60+ $12 $13 $14
(1) A three-year license is only available for dogs that have attained the age of 12 months or older and have been vaccinated. In any event no license period may extend beyond the remaining period of validity for the current rabies vaccination. (Gov’t. Code, § 38792(b).) SECTION 4. This Resolution shall become effective immediately upon its adoption.

ADOPTED ON this 22nd day of August, 2024.

KARINA QUINTANILLA
MAYOR
ATTEST:

ANTHONY J. MEJIA

CITY CLERK
I, Anthony J. Mejia, City Clerk of the City of Palm Desert, hereby certify that Resolution No. 2024-____ is a full, true, and correct copy, and was duly adopted at a regular meeting of the City Council of the City of Palm Desert on ____________, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

RECUSED:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of Palm Desert, California, on ___________________, 2024.

ANTHONY J. MEJIA

CITY CLERK
1058