Agenda packet — Palm Springs City Council, May 9, 2024 (part 2 of 3)

Recording Requested By:

When Recorded Mail To:

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VERIFICATION
I, _______________________________________________, state: I am the ________________________________ __ (“Owner∫, “President”, “Authorized Agent”, “Partner”, etc.) of the O
wner identified
in the foregoing Notice of Completion. I have read said Notice of Completion and know the contents thereof; the same is true of my own knowledge.

I declare und
er penalty of perjury under the laws of the State of California that the foregoing is true and correct.

Executed on _______________________, _______ (date), at ____ ___________________________________________ ______ (City), ________ (State). ______________________________________________________
Signature of Owner or Owner’s Authorized Agent
Joel Montalvo/City Engineer
City of Palm Springs

STATE OF CALIFORNIA
COUNTY OF ______________________________________
On _____________________________ ____________, ________ (date), before me, ________________________________ ____________, Notary Public (name and title of officer) 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 authorize d 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 PURJURY under the laws of the State of California that the foregoing paragraph is true and correct.

Witness my hand and official seal.
_____________________________________________
Signature
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.

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Attachment B
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CITY OF PALM SPRINGS
CONTRACT CHANGE ORDER No. 1
HAWK SIGNAL INSTALLATION, E RACQUET CLUB ROAD AND VIA MIRALESTE CITY PROJECT NO. 21‐12

Contractor: Elecnor Belco Electric, Inc. Date: May 9, 2024

CONTRACT CHANGE ORDER SUMMARY
Final balancing change order assessing project credits.

CONTRACT CHANGE ORDER COST
ID Description Qty Unit Cost
01 Credit for unused field allowance 1 LS ($14,729.26)

CHANGES TO CONTRACT TIME:

Due to various delays outline below, 208 Calendar days will be added to the contract time:
 Southern California Edison ‐ additional infrastructure needed (no cost to City).  Various rain delays, including Hurricane Hillary.
 Speed feedback sign equipment delays.

Summary of Costs:

Original Contract Amount: $363,789.00 Construction Start Date: 06/12/2023 Previous Contract Change Orders: $0.00 Previous Agreed Completion Date: 09/11/2023 This Change Order Amount: ($14,729.26) Calendar Days Added: 208 Revised Contract Amount: $349,059.74 Revised Completion: 04/15/2024

I have received a copy of this Change Order and the above AGREED PRICES are acceptable to Contractor.

Elecnor Belco Electric, Inc.

Alberto Garcia, President/CEO Date
City of Palm Springs

Approved By:

Joel Montalvo, City Engineer Date
Attest By:

Brenda Pree, City Clerk Date

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CITY COUNCIL STAFF REPORT

DATE: MAY 9, 2024 CONSENT CALENDAR

SUBJECT: A DOPT THE CITY OF PALM SPRINGS FY 2024- 25 INVESTMENT

POLICY GOVERNING THE INVESTMENT OF CITY FUNDS

FROM: Scott C. Stiles, City Manager

BY: Department of Finance and Treasury

SUMMARY:

Government Code 53646 (1)(2) provides for the City Council’s annual consideration of the City’s Investment Policy at a public meeting. Additionally, the City Council may elect to delegate its authority to invest and reinvest City funds to the City Treasurer for up to one year pursuant to California Code section 53607. The proposed Investment Policy and delegation of authority will be effective upon adoption by the City Council.

RECOMMENDATION:

Adopt Resolution No. _____, “ A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF PALM SPRINGS, CALIFORNIA, ADOPTING AN INVESTMENT POLICY

GOVERNING THE INVESTMENT OF CITY FUNDS AND SUPERCEEDING RESOLUTION NO. 25123” and delegating the City Council’s authority to invest and reinvest public funds, and to sell or exchange securities so purchased, to the City Treasurer for one year or until earlier revoked by the City Council.

BACKGROUND:

The City of Palm Springs has had an investment policy since 1985. The Treasurer and Finance Department Staff ensure that all investments are consistent with the Investment Policy and provide oversight with appropriate checks and balances over the investment process. The Policy requires annual adoption by City Council. On January 28, 2021, the City Council approved the appointment of Chandler Asset Management, LLC to provide investment advisory services to the City. Although Chandler Asset Management works with Staff to actively manage the portion of the City’s cash portfolio not needed to meet near-term obligations, fiduciary responsibility for investments remains with the City.

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City Council Staff Report
May 9, 2024-- Page 2
FY24-25 Investment Policy Governing the Investment of City Funds

STAFF ANALYSIS:

In collaboration with the City of Palm Springs’ investment advisor, Chandler Asset Management, the Finance Subcommittee recently reviewed the City’s investment policy.

The team from Chandler Asset Management recommended changes that incorporated industry best practices and two updates to align with California State Code. Those changes are listed in the document, with comments, in Attachment A.

The unchanged language in the policy is consistent with updated State statues and enables the portfolio to transition from passive management (hold all securities until maturity) to active management (responsive to changing market conditions). The Investment Portfolio will continue to be managed with the policy prioritization of Safety first, Liquidity second, and Return on Investment third.

Additionally, attached for the City Council’s consideration is the current Management Directive (Attachment C) and the Staff report from October 2021 which reviews the City’s directive to Chandler Asset Management on Socially Responsible Investing (SRI) and Environmental, Social, Governance (ESG) strategies (Attachment D).

Pursuant to the delegation of authority authorized by Government Code section 53607, the City Treasurer is required to make a monthly report of investment transactions to the City Council. Each monthly Cash and Investments Report (“Treasurer’s Report”) describes the portfolio’s composition and recent performance and reports the month’s investment transactions. Within each Treasurer’s Report, the Treasurer certifies that all investments were made in compliance with the Investment Policy and that there are adequate funds to pay City obligations for at least six months.

ALIGNMENT WITH STRATEGIC PLANNING:

This item aligns with the City Council priorities of Forward-Thinking Governance and Quality of Life.

FISCAL IMPACT:

None.

REVIEWED BY:

Department Director: Kristopher J. Mooney
City Manager: Scott Stiles

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City Council Staff Report
May 9, 2024-- Page 3
FY24-25 Investment Policy Governing the Investment of City Funds

ATTACHMENTS:

A. City of Palm Springs Investment Policy (Redlined showing updates) B. City of Palm Springs Investment Policy Final
C. City of Palm Springs Management Directive
D. October 2021 Staff Report with SRI/ESG strategies
E. Resolution

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ATTACHMENT A

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In collaboration with the City of Palm Spring’s investment advisor, Chandler Asset Management, ﬁnance staff recently reviewed and updated the City’s investment policy to capture recent changes to California Government Code (Code) sections that govern the investment of public funds. Staff also reviewed to policy to ensure inclusion of the latest best practices from recognized industry groups such as Government Finance Officers Association (GFOA), California Society of Municipal Finance Officers (CSMFO), and the California Municipal Treasurers Association (CMTA).

Below is a summary of those changes:
• Section 9 Cash and Investment Instruments
o Updated the language on Pass Thru Securities to be in line with the Passing of SB 882. o Updated the maximum percentage investment for Mutual Funds and Money Market Funds to add clarity on speciﬁc limitations.
o Removed Local Government Investment Pools(LGIP) from Mutual Funds and Money Market Funds and creating a separate LGIP section.
o Added clarity to the types of Certiﬁcates of Deposit by creating new sections for Negotiable Certiﬁcates of Deposit, Placement Service Deposits, Collateralized Bank Deposits, and Repurchase Agreements. This is to bring the policy inline with industry best practices and add risk management language for each new section. o Removed Repurchase Agreements from the list of Prohibited Securities (section

9.3) and enhanced the risk management language.
• Section 10 Collateralization
o Updated the language for collateralization requirements to be in line with the recommendations for inclusion of other types of CDs and Repurchase Agreements. • Section 11 Safekeeping and Custody:
o Included best practices language related to exceptions of policy. • Section 12 Investment Pools/ Mutual Funds (NEW SECTION) o Added a new section on Investment Pools and Funds to be updated with best practices.
• Section 18 Reporting
o Included language to be in alignment with CGC 53607 and 53646.

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CITY OF PALM SPRINGS
2023-2024

INVESTMENT POLICY

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INVESTMENT POLICY AND GUIDELINES

2 1.0 Purpose:

The purpose of this Investment Policy (Policy) is to set forth the investment and operational guidelines for the management and investment of the public funds of the City of Palm Springs, California. The Policy requires adoption by, and can only be changed by, a majority vote of the City Council.

The Policy is designed to ensure the prudent management of public funds, the availability of operating and capital funds when needed, and an investment total return that is comparable to established benchmarks, as appropriate.

A copy of this statement will be provided to all investment dealers and investment managers doing business with the City of Palm Springs, and will be provided to other interested parties on request. Receipt of this policy, including confirmation that it has been reviewed by individuals working directly with the City’s investment account will be received prior to any organization providing investment services to the City of Palm Springs.

2.0 Policy:

The investment Policy and practices of the City of Palm Springs are based upon state law and prudent money management consistent with City policies. The primary goals of these practices are:

A. To ensure compliance with all Federal, State, and local laws governing the investment of public funds under the control of the Director of Finance/Treasurer.

B. To protect the principal of monies entrusted to the City’s Finance Department.

C. Achieve a reasonable rate of return within the parameters of prudent risk management while minimizing the potential for capital losses arising from market changes or issuer default.

3.0 Scope:

This Investment Policy applies to all financial assets of the City of Palm Springs. These funds are accounted for in the City’s Comprehensive Annual Financial Report.

The Director of Finance/Treasurer is responsible for investing the unexpended cash in the City Treasury for all funds, except for the employee’s retirement funds or deferred compensation accounts, which are administered separately, and those funds which ar e managed separately by trustees appointed under indenture agreements.

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3 These funds include, but are not limited to:
• General Fund
• Special Revenue Funds
• Capital Project Funds
• Debt Service Fund
• Enterprise Funds
• Internal Service Funds
• Trust and Agency Funds
• Bond Proceeds
• Any new fund created by the legislative body, unless specifically exempted This Investment Policy applies to all transactions involving the financial assets and related activity of the foregoing funds.

4.0 Prudence:

The standard of prudence to be used by the Director of Finance/Treasurer shall be the “prudent investor standard.” This shall be applied in the context of managing an overall portfolio. The “prudent investor standard” shall be applied to the City, pursuant to California Government Code Section 53600.3 which provides, in pertinent part:
“ … all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the genera l economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the agency.…”

4.1 Personal Responsibility:

The Director of Finance/Treasurer, as the investment officer acting in accordance with written procedures and the Investment Policy and exercising due diligence, shall be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported to the City Council in a timely fashion and appropriate action is taken to control adverse developments.

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INVESTMENT POLICY AND GUIDELINES

4 5.0 Objective:

Consistent with this aim, investments are made under the terms and conditions of California Government Code Section 53600, et seq. Criteria for selecting investments and the absolute order of priority are:

Safety
Safety of principal is the foremost objective of the investment program. Investments of the City of Palm Springs shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. To attain this objective, diversification is required in order that potential losses on individual securities do not exceed the income generated from the remainder of the portfolio.

Liquidity
The City of Palm Springs’s investment portfolio will remain sufficiently liquid to enable the City to meet all operating requirements which might be reasonably anticipated and to maintain compliance with any indenture agreement, as applicable. Liquidity is essential to the safety of principal.

Return on Investments
The City of Palm Springs’s investment portfolio shall be designed with the objective of attaining a market -average rate of return throughout budgetary and economic cycles (market interest rates), within the City’s Investment Policy’s risk parameters and the City’s cash flow needs. See also Section 1516.1.

6.0 Delegation of Authority:

The Director of Finance/Treasurer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials. The responsibility for the day-to-day investment of City funds may be delegated to other Department of Finance staff members as determined by the Director of Finance/Treasurer.

Procedures should include references to: ACH/wire transfer agreements, and collateral/depository agreements, as appropriate. Such procedures shall include explicit delegation of authority to persons responsible for investment transactions. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the Director of Finance/Treasurer. The Director of Finance/Treasurer shall be responsible for all transactions undertaken and shall establish a system of controls to regulate the activities of subordinate officials. Under the provisions of California Government Code 53600.3, the Director of Finance/Treasurer is a trustee Item 1G - Page 9

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INVESTMENT POLICY AND GUIDELINES

5 and a fiduciary subject to the prudent investor standard.

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

7.0 Ethics and Conflicts of Interest:

Consistent with state statutes and regulations and the City’s local policies relating to conflicts of interest, all persons involved in the investment process shall refrain from personal business activity that could conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions.

Employees and investment officers are required to file annual disclosure statements as required for “public officials who manage public investments” [as defined and required by the Political Reform Act and related regulations, including Government Code Sections 81000, et seq., and the rules, regulations and guidelines promulgated by California’s Fair Political Practices Commission (FPPC)].

8.0 Authorized Financial Dealers and Institutions:

The City’s Director of Finance/Treasurer will maintain a list of the financial institutions and brokers/dealers authorized to provide investment and depository services and will perform an annual review of the financial condition and registrations of qualified bidders and require annual audited financial statements to be on file for each company. The City shall annually send a copy of the current Investment Policy to all financial institutions and brokers/dealers approved to do business with the City.

If the City uses an external investment adviser, the adviser is authorized to enter into transactions with its own approved Broker -Dealer list on behalf of the City. The adviser shall perform all due diligence for all brokers/dealers on its approved list. The external investment adviser shall annually provide the City its approved Broker-Dealer list so that the Director of Finance/Treasurer may conduct their own review.

As far as possible, all money belonging to, or in the custody of, a local agency, including money paid to the City’s Director of Finance/Treasurer or other official to pay the principal, interest, or penalties of bonds, shall be deposited for safekeeping in state or national banks, savings associations, federal associations, credit unions, or federally insured industrial loan companies in this state selected by the City’s Director of Finance/Treasurer; or may be invested in the investments set forth in Section 9.0. To be eligible to receive local agency money, a bank, savings association, federal association, or federally insured industrial loan company shall have received an overall rating of not Item 1G - Page 10

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6 less than “satisfactory” in its most recent evaluation by the appropriate federal financial supervisory agency of its record of meeting the credit needs of California’s communities, including low- and moderate-income neighborhoods.

To provide for the optimum yield in the investment of City funds, the City’s investment procedures shall encourage competitive bidding on transactions from approved brokers/dealers. In order to be approved by the City, the dealer must meet the following criteria: (i) the dealer must be a “primary” dealer or regional dealer that qualifies under Securities and Exchange Commission Rule 15C3- 1 (Uniform Net Capital Rule); (ii) the dealer’s institution must have an office in California; (iii) the dealer must be experienced in institutional trading practices and familiar with the California Government Code as related to investments appropriate for the City; and (iv) all other applicable criteria, as may be established in the investment procedures. All brokers/dealers and financial institutions who desire to become qualified bidders for investment transactions must submit a “Broker/Dealer Application” and related documents relative to eligibility including a current audited annual financial statement, U4 form for the broker, proof of state registration and proof of National Association of Securities Dealers certification. The City’s Director of Finance/Treasurer shall have also have received a signed Certification from the firm of having read and understood the City’s Investment Policy and agreeing to comply with the Investment Policy. The City’s Director of Finance/Treasurer shall determine if they are adequately capitalized (i.e. qualifies under SEC Rule 15C3- 1, Uniform Net Capital Rule and five years of operation). If the City uses an external investment advisor, the investment adviser will use the firm’s best execution procedures, and must retain documentation of competitive pricing execution on each transaction and provide such documentation to the Director of Finance/Treasurer upon request.

9.0 Cash and Investment Instruments:

City active and inactive deposits may be kept in checking accounts and savings accounts at financial institutions as identified in California State Government Code Section 53648 provided that they are adequately secured with proper collateral as prescribed by Government Code Sections 53656 and/or 53658. Funds may be automatically swept from the above accounts into investment instruments provided those investment instruments are allowable investments as listed in this section, and limited to the percentage of the portfolio prescribed for each investment instrument.

Allowable investments for the portfolio of the City of Palm Springs are limited by California State Government Code Sections 53601 et seq.; and Section 53635. They are further restricted by the Director of Finance/Treasurer’s investment strategy. Limitations on percentage of portfolio, single issue or issuer, credit quality, diversification, and maturity apply at the time of purchase. Purchased securities may not exceed five-year maturities.

Exceptions can only be approved by the City Council. The investment instruments and Item 1G - Page 11

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7 percentage of the portfolio permitted by this policy are described below. Investments not specifically listed below are deemed inappropriate and prohibited.

OBLIGATIONS OF THE UNITED STATES TREASURY
United States Treasury notes, bonds, bills, or certificates of indebtedness, or those for which the faith and credit of the United States are pledged for the payment of principal and interest.
• Maximum Maturity: 5 Years
• Maximum Percentage of Portfolio: 100%

BONDS ISSUED BY THE CITY OR ANY LOCAL AGENCY WITHIN THE STATE OF

CALIFORNIA OR THE STATE OF CALIFORNIA
Registered California warrants, 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.

Bonds, notes, warrants or other evidences of indebtedness of any local agency within California including bonds payable 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. Investments under this section must be rated in a rating category “A” or better by a nationally recognized rating service. • Maximum Percentage of Portfolio: 15%
• Maximum Exposure: 5% per Issuer.

FEDERAL AGENCIES
Obligations issued by banks for cooperatives, federal land banks, federal intermediate credit banks, federal home loan banks, the Federal Home Loan Bank Board, Federal Home Loan Mortgage Corporation, Federal Home Loan Bank, Federal Farm Credit Bank, the Tennessee Valley Authority, or in obligations, participations, or other instruments of, or issued by, or fully guaranteed as to principal and interest by, the Federal National Mortgage Association; or in guaranteed portions of Small Business Administration notes; or in obligations, participations, or other instruments of, or issued by, a federal agency or United States government-sponsored enterprise.
• Maximum Maturity: 5 Years
• Maximum Percentage of Portfolio: 60%
• M aximum percent of callable agency securities in the portfolio will be 20%.

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8 BANKERS’ ACCEPTANCES
Bills of exchange or time drafts drawn on and accepted by a commercial bank, typically created from a letter of credit issued in a foreign trade transaction. Eligibility is limited to U.S. banking corporations.
• Maximum Maturity: 180 Days
• Maximum Percentage of Portfolio: 20%
• Maximum Exposure: 5% per bank
• Credit Requirement: A-1, P-1, F-1 (Per S&P/ Moody’s /Fitch)

COMMERCIAL PAPER
Commercial Paper ranked A-1, P-1, F-1 by one of the major rating agencies and issued by a domestic corporation having assets in excess of $500,000,000 and in a rating category of “A” or better rating on its long term debentures, if any, as determined by a recognized national rating agency.
• Maximum Maturity: 270 Days
• Maximum Percentage of Portfolio: 15% Under a provision sunsetting on January 1, 2026, no more than 40% of the portfolio may be invested in Commercial Paper if the Agency’s investment assets under management are greater than $100,000,000.
• Maximum Exposure: 5% per Issuer
• Credit Requirement A-1, P-1, F-1 (Per S&P/ Moody’s / Fitch)

NEGOTIABLE CERTIFICATES OF DEPOSIT
Negotiable certificates of deposit issued by a nationally or state-chartered bank, a savings association or a federal association, a state or federal credit union, or by a state-licensed branch of a foreign bank. Securities in this category exceeding federal deposit insurance limits shall be rated or issued by institutions which have long-term debt obligations rated in rating category of “A” (or the equivalent) or better and short -term debt obligations, if any, rated “A -1” (or the equivalent) or better by at least two nationally recognized statistical rating agencies.
• Maximum Maturity: 5 Years
• Maximum Percentage of Portfolio: 30%
• Maximum Exposure: 5% per Issuer
• FDIC-insured up to $250,000
• Credit Requirement if over $250,000: Rating of “A” or the equivalent (Per S&P/ Moody’s / Fitch)
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9 MEDIUM-TERM CORPORATE NOTES
Medium term notes, defined as all corporate and depository institution debt securities with a maximum remaining maturity of five years or less, issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States. Notes eligible for investment under this subsection must be rated in a rating category “A” or better by a nationally recognized rating service at the time of purchase.
• Maximum Maturity: 5 Years
• Maximum Percentage of Portfolio: 30%
• Maximum Exposure: 5% per Issuer

PASS-THROUGH SECURITIES
Asset-Backed, Mortgage-Backed, Mortgage Pass-Through Securities, and Collateralized Mortgage Obligations from issuers not defined as Obligations of the United States Treasury or Federal Agencieslimited to mortgage-backed pass-through securities issued by a US government agency or consumer receivable pass-through certificates or bonds with a final maturity not exceeding five years. The securities are rated in a rating category of “AA” or its equivalent or higher by a NRSRO with a final maturity not exceeding five years. The aggregate investment in mortgage-backed and asset-backed securities described in this section shall not exceed 20% of the portfolio with no more than 5% held in any one issuer that is not a US government agency.

• Maximum Maturity: 5 Years
• Maximum Percentage of Portfolio: 20%
• Maximum Exposure: 5% per Issuer

SUPRANATIONAL SECURITIES
Medium United States dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank, with a maximum remaining maturity of five years or less, and eligible for purchase and sale within the United States. Investments under this subdivision shall be rated in a rating category of “AA” or its equivalent or higher by a NRSRO and shall not exceed 30% of the portfolio with no more than 10% invested in any one issuer. • Maximum Maturity: 5 Years
• Maximum Percentage of Portfolio: 30%
• Maximum Exposure: 10% per Issuer

Commented [AS1]: Updated language to be in line with
SB 882 (which clarified the limitations on Pass Thru
Securities)
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10 MUTUAL FUNDS AND MONEY MARKET MUTUAL FUNDS
California Government Code Sections 53601 (k) permits public agencies to invest 20% of their portfolio in mutual funds or money market. Money market funds are limited to a maximum dollar-weighted average maturity of 90 days; each investment must have a remaining maturity of thirteen months or less at time of purchase; and the fund must strive to maintain a constant net asset value of $1.00. These restrictions are designed to protect assets from a loss in value that can result from substantial increases in interest rates.

The California Government Code Section 53601 (k) (2) permits public agencies to invest in “shares of beneficial interest issued by diversified management companies that are money market funds registered with the Securities and Exchange Commission under the Investment Company Act of 1940 (15 U.S.C. Sec. 80a- 1, et seq.) as long as the company shall have met either of the following criteria: (A) Attained the highest ranking or the highest letter and numerical rating provided by not les s than two nationally recognized statistical rating organizations or (B) Retained an investment advisor registered or exempt from registration with the Securities and Exchange Commission with no less than five years’ experience investing in the securities and obligations authorized by subdivisions (a) to (j), inclusive, or subdivisions (m) or (n) and with assets under management in excess of five hundred million dollars ($500,000,000).” • Maximum Percentage of Portfolio invested in shares of any one mutual fund: 10 % • Maximum Percentage of Portfolio invested in shares of any one Money Market Mutual Fund: 20%

LOCAL GOVERNMENT INVESTMENT POOLS
The California Government Code Section 53601 (p) permits public agencies to invest in “shares of beneficial interest issued by a joint powers authority organized pursuant to Section 6509.7 that invests in the securities and obligations authorized in subdivisions (a) to (o), inclusive. Each share shall represent an equal proportional interest in the underlying pool of securities owned by the joint powers authority. To be eligible under this section, the joint powers authority issuing the shares shall have retained an investment adviser that meets all of the following criteria: (1) The adviser is registered or exempt from registration with the Securities and Exchange Commission; (2) The adviser has not less than five years of experience investing in the securities and obligations authorized in subdivisions (a) to (o), inclusive; and (3) The adviser has assets under management in excess of five hundred million dollars ($500,000,000).” • Maximum Percentage of Portfolio in LGIPs: 20%
• Duration: Less than 1 year; Maximum Percentage of Portfolio: 50% • Duration: More than 1 year; Maximum Percentage of Portfolio: 25% Commented [AS2]: Recommend updating language to
add clarity on limitations to specific fund
Commented [CM3]: Recommend updating language to
add clarity on limitations to specific funds
Commented [CM4]: Recommend creating a separate
section for LGIPS and adjusting the limitation to them to be 20%
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11 TIME DEPOSITS-CERTIFICATES OF DEPOSIT (non-negotiable certificates of deposit.) Time deposits, non- negotiable and collateralized in accordance with the California Government Code, may be purchased through banks or savings and loan associations with a rating category of “A” or better rating.
• Maximum Maturity: 1 5 Year
• Maximum Percentage of Portfolio: 1020%
• Maximum Exposure: Limited to the maximum covered under federal insurance$500,000 per Issuer
NEGOTIABLE CERTIFICATES OF DEPOSIT (NCDs)
NCDs issued by a nationally or state-chartered bank, a savings association or a federal association, a state or federal credit union, or by a federally licensed or state-licensed branch of a foreign bank may be purchased. Investments under this subdivision shall be rated in a rating category of “A” or its equivalent or higher by a NRSRO and shall not exceed 30% of the portfolio with no more than 5% invested in any one issuer. • Maximum Maturity: 5 Year
• Maximum Percentage of Portfolio: 30%
• Maximum Exposure: 5% per issuer

PLACEMENT SERVICE DEPOSITS
Investment in this subdivision shall be no more than 30% of the total portfolio in combination with Certificates of Deposit, including CDARS. Under a provision sunsetting on January 1, 2026, no more than 50% of the portfolio may be invested in deposits through a placement service, including Certificates of Deposit, if the Agency is a city, district or local agency that does not pool money with other local agencies. • Maximum Maturity: 5 Year
• Maximum Percentage of Portfolio: 30%

COLLATERALIZED BANK DEPOSITS
City deposits with financial institutions will be collateralized with pledged securities per California Government Code, Section 53651. There are no limits on the dollar amount or percentage that the City may invest in collateralized bank deposits.

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12 City may invest, provided that the securities used as collateral for Repurchase Agreements will be delivered to an acceptable third- party custodian. Repurchase Agreements are subject to a Master Repurchase Agreement between the City and the provider of the repurchase agreement. The Master Repurchase Agreement will be substantially in the form developed by the Securities Industry and Financial Markets Association (SIFMA).
• Maximum Maturity: Does not exceed 1 Year

THE LOCAL AGENCY INVESTMENT FUND (LAIF)
A pooled investment fund managed by the State Treasurer’s Office, which operates like a money market fund for the exclusive benefit of governmental entities within California. • Maximum of Portfolio: Maximum set by LAIF

9.1 Bond Proceeds
In addition to the investment vehicles enumerated in Section 9.0, the proceeds of bond issues (including reserve funds) may be invested in long term Guaranteed Investment Contracts (GIC), Investment Agreements (IA), or other Structured Products (SP) that comply with the Permitted Investment restrictions of the particular bond issue.

Before soliciting bids from providers of GIC's, IA's, or SP’s, the Director of Finance/Treasurer shall obtain approval from the City Council to proceed.

9.2 Investment Pools:

The City’s Director of Finance/Treasurer or designee shall be required to investigate all local government investment pools and money market mutual funds prior to investing and performing an annual review thereafter while the City is invested in the pool or the money market fund. LAIF is authorized under provisions in Section 16429.1 of the California Government Code as an allowable investment for local agencies even though some of the individual investments of the pool are not allowed as a direct investment by a local agency.

9.3 Prohibited Investments:

Under the provisions of California Government Code Sections 53601.6 and 53631.5, the City of Palm Springs shall not invest any funds covered by this Investment Policy in inverse floaters, dual index, stepped inverse derivatives, repurchase agreements, reverse repurchase agreements, range notes, interest -only strips derived from mortgage pools, stock in any joint company, corporation or association; securities with a forward settlement date exceeding 45 days; or any investment that may result in a zero inter est accrual if held to maturity. Under a provision sunsetting on January 1, 2026, securities Commented [CM5]: Recommend adding clarity to CD and
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13 backed by the U.S. Government that could result in a zero- or negative-interest accrual if held to maturity are permitted. Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited.

9.4 Social Responsibility:

The City shall not knowingly make any investments in any institution, company, corporation, subsidiary, or affiliate that practices or supports directly or indirectly through its actions, discrimination on the basis of race, religion, color, creed, national or ethnic origin, age, sex, sexual orientation, or physical disability, as this is not in accordance with the City of Palm Springs policies regarding discrimination.

Investments are encouraged in entities that support community well -being through safe and environmentally sound practices and fair labor practices. Investments are encouraged in entities that support equality of rights regarding race, religion, color, creed, national or ethnic origin, age, sex, sexual orientation, or physical disability. Investments should be made to the extent reasonable under the circumstances that such socially responsible investments meet minimum permitted requirements by state law, and achieve substantially equivalent safety, liquidity, and yield when compared to similar investments permitted by state law.

Prior to making investments the City’s Director of Finance/Treasurer’s office will reasonably verify an entity’s support of the socially responsible goals listed above through direct contact or through the use of a third party resource.

10.0 Collateralization:

Certificates of Deposit (CDs)
The City shall require any commercial bank or savings and loan association to deposit eligible securities with an agency of a depository approved by the State Banking Department to secure any uninsured portion of a Non-Negotiable Certificate of Deposit.

The value of eligible securities as defined pursuant to California Government Code, Section 53651, pledged against a Certificate of Deposit shall be equal to 150% of the face value of the CD if the securities are classified as mortgages and 110% of the face value of the CD for all other classes of security.

Collateralization of Bank Deposits
This is the process by which a bank or financial institution pledges securities, or other deposits for the purpose of securing repayment of deposited funds. The City shall require any bank or financial institution to comply with the collateralization criteria defined in California Government Code, Section 53651.

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14 Repurchase Agreements
The City requires that Repurchase Agreements be collateralized only by securities authorized in accordance with California Government Code. The securities which collateralize the repurchase agreement shall be priced at Market Value, including any Accrued Interest plus a margin. The Market Value of the securities that underlie a repurchase agreement shall be valued at 102% or greater of the funds borrowed against those securities. Financial institutions shall mark the value of the collateral to market at least monthly and increase or decrease the collateral to satisfy the ratio requirement described above. The City shall receive monthly statements of collateral

10.0 Collateralization:

Under provisions of the California Government Code, California banks and savings and loan associations are required to secure the City’s deposits by pledging government securities with a value of 110 % of principal and accrued interest. California law als o allows financial institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the City’s total deposits. Collateral will always be held by an independent third party. The market value of securities that underlay a repurchase agreement shall be valued at 102% or greater of the funds borrowed against those securities and the value shall be adjusted no less than quarterly. Since the market value of the underlying securities is subject to daily market fluctuatio ns, the investments in repurchase agreements shall be in compliance if the value of the underlying securities is brought back up to 102% no later than the next business day. The Director of Finance/Treasurer, at his or her discretion, may waive the collateral requirement for deposits that are fully insured up to $250,000 by the Federal Deposit Insurance Corporation. The right of collateral substitution is granted.

11.0 Safekeeping and Custody:

All City investments shall identify the City of Palm Springs as the registered owner, and all interest and principal payments and withdrawals shall indicate the City of Palm Springs as the payee. All securities shall be safe kept with the City itself or with a qualified financial institution, contracted by the City as a third party. All agreements and statements will be subject to review annually by external auditors in conjunction with their audit. In the event that the City has a financial institution hold the securities, a separate custodial agreement shall be required. All securities shall be acquired by the safekeeping institution on a “Delivery-Vs-Payment” (DVP) basis.

The only exceptions to the foregoing shall be depository accounts and securities purchases made with: (i) local government investment pools; (ii) time certificates of deposit, and, (iii) mutual funds and money market mutual funds, since these securities Commented [CM6]: Recommend updating
Collateralization language to be in line with
recommendations for the inclusion of other authorized
investments.

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15 are not deliverable.

12.0 Investment Pools/Mutual Funds
The City shall conduct a thorough investigation of any pool or mutual fund prior to making an investment, and on a continual basis thereafter. Annually, the Director of Finance/Treasurer shall seek responses to the following questions from any investment pool or mutual fund in which the City invests:
• A description of eligible investment securities, and a written statement of investment policy and objectives.
• A description of interest calculations and how it is distributed, and how gains and losses are treated.
• A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited. • A description of who may invest in the program, how often, what size deposit and withdrawal are allowed.
• A schedule for receiving statements and portfolio listings. • Are reserves, retained earnings, etc. utilized by the pool/fund? • A fee schedule, and when and how it is assessed.
• Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds? 1213.0 Risk Management and Diversification

Mitigating Credit Risk in the Portfolio
Credit risk is the risk that a security or a portfolio will lose some or all its value due to a real or perceived change in the ability of the issuer to repay its debt. The City will mitigate credit risk by adopting the following strategies:
• The diversification requirements included in the “Authorized Investments” section of this policy are designed to mitigate credit risk in the portfolio.

• No more than 5% of the total portfolio may be deposited with or invested in securities issued by any single issuer unless otherwise specified in this policy.

• The City may elect to sell a security prior to its maturity and record a capital gain or loss in order to manage the quality, liquidity or yield of the portfolio in response to market conditions or City’s risk preferences.

• If a security owned by the City is downgraded to a level below the requirements of this policy, making the security ineligible for additional purchases, the Director of Finance/Treasurer will use discretion in determining whether to sell or hold the Commented [CM7]: Updating best practices language
Commented [CM8]: Adding risk management language
related to Pools and Mutual funds
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16 security based on its current maturity, the economic outlook for the issuer, and other relevant factors. If a decision is made to retain a downgraded security in the portfolio, its presence in the portfolio will be monitored and reported monthly to the City Council.

• If a security is downgraded by any NRSRO (Moody’s, S&P or Fitch) below the rating category of “BBB”, it must be sold and removed from the City’s Portfolio unless the City Council approves the Director of Finance/Treasurer’s recommendation that the security should be retained. Director of Finance/Treasurer will monitor and report status of such security to City Council on each quarterly report prepared pursuant to Section 18.0

Mitigating Market Risk in the Portfolio
Market risk is the risk that the portfolio value will fluctuate due to changes in the general level of interest rates. The City recognizes that, over time, longer-term portfolios have the potential to achieve higher returns. On the other hand, longer-term portfolios have higher volatility of return. The City will mitigate market risk by providing adequate liquidity for short-term cash needs, and by making longer-term investments only with funds that are not needed for current cash flow purposes.

The City further recognizes that certain types of securities, including variable rate securities, securities with principal paydowns prior to maturity, and securities with embedded options, will affect the market risk profile of the portfolio differently in different interest rate environments. The City, therefore, adopts the following strategies to control and mitigate its exposure to market risk:
• The City will maintain a minimum of six months of budgeted operating expenditures in short term investments to provide sufficient liquidity for expected disbursements.

• The maximum stated final maturity of individual securities in the portfolio will be five (5) years, except as otherwise stated in this policy.

• The duration of the portfolio will generally be approximately equal to the duration (typically, plus or minus 20%) of a Market Benchmark, an index selected by the City based on the City’s investment objectives, constraints and risk tolerances.

1314.0 Maximum Maturities:

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17 To the extent possible, the City will attempt to match its investments with anticipated cash flow requirements. Unless matched to a specific cash flow, the City will not directly invest in securities maturing more than five (5) years from settlement date, 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. I ndividual maturities are subject to the limitations described in Section 9.0.
1415.0 Internal Control:

The Director of Finance/Treasurer shall establish a system of internal controls designed to prevent loss of public funds due to fraud, employee error, and misrepresentation by third parties, or unanticipated market changes. No investment personnel may engage in an investment transaction except as provided for under the terms of this Investment Policy and the procedure established by the Director of Finance/Treasurer.

The external auditors shall annually review the investments with respect to the Investment Policy. This review will provide internal control by assuring compliance with policies and procedures for the investments that are selected for testing. Additional ly, account reconciliation and verification of general ledger balances relating to the purchasing or maturing of investments and allocation of investments to fund balances shall be performed by the Finance Department and approved by the Director of Finance/Treasurer.

To provide further protection of City funds, wiring of any City funds is prohibited without the authorization of one of the following designated City staff:

1. Director of Finance/Treasurer

2. Assistant Director of Finance

3. Assistant City Manager

4. City Manager
1516.0 Performance Standards:

This Investment Policy shall be reviewed at least annually by the Director of Finance/Treasurer to ensure its consistency with the overall objective of preservation of principal, liquidity, and return, and its relevance to current law and financial and economic trends. All financial assets of all other funds shall be administered in accordance with the provisions of this Investment Policy.
1516.1 Market Yield (Benchmark):

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18 constraints and cash flow. Investment return becomes a consideration only after the basic requirements of investment safety and liquidity have been met. The Finance Director/Treasurer shall establish an appropriate benchmark or benchmarks, as appropriate, for investment parameters that reflect the types and maturities of investments allowed under this policy. While the City will not make investments for the purpose of trading or speculation as the dominant criterion, the Director of Finance/Treasurer shall seek to enhance total portfolio return by means of ongoing portfolio and cash management. The prohibition of highly speculative investments precludes pursuit of gain or profit through unusual risk and precludes investments primarily directed at gains or profits from conjectural fluctuations in market prices. The Director of Finance/Treasurer will not directly pursue any investments that are leveraged or deemed derivative in nature. However, as long as the original investments can be justified by their ordinary earning power, trading in response to changes in market value can be used as part of on-going portfolio management.
1617.0 Oversight Committee:

A committee comprised of two Council members appointed by Council, the City Manager and the Director of Finance/Treasurer, shall provide oversight of the City's investments.

The Committee shall meet quarterly to review the City’s investment activity.

1718.0 Reporting:

MONTHLY REPORTS
Monthly transaction reports will be submitted by the Director of Finance/Treasury to the City Council in accordance with California Government Code Section 53607.

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19 • A one-page summary report that shows:
o Average maturity of the portfolio and modified duration of the portfolio;
o Maturity distribution of the portfolio;
o Percentage of the portfolio represented by each investment category;
o Average portfolio credit quality; and,
o Time-weighted total rate of return for the portfolio for the prior one month, three months, twelve months and since inception compared to the City’s market benchmark returns for the same periods described in Section 16.1;
• A statement of compliance with investment policy, including a schedule of any transactions or holdings which do not comply with this policy or with the California Government Code, including a justification for their presence in the portfolio and a timetable for resolution.
• A statement that the City has adequate funds to meet its cash flow requirements for the next six months.”
The Director of Finance/Treasurer shall submit a monthly investment report to the City Council following the end of each month. This report will include the following elements:
• Type of investment
• Institutional Issuer
• Purchase Date
• Date of maturity
• Amount of deposit or cost of the investment
• Face value of the investment
• Current market value of securities and source of valuation • List of transactions occurring during the reporting period • Rate of interest
• Percentage of Portfolio by Investment Type and by Maturity • Days to Maturity for all Investments
• Performance of the portfolio relative to benchmark(s), as appropriate • Comparative report on Quarterly Investment Balances and Yields • Statement relating the report to its compliance with the Statement of Investment Policy or the manner in which the portfolio is not in compliance • Statement on availability of funds to meet the next six month’s obligations This monthly investment report shall be an information item for the City Council. A commentary on capital markets and economic conditions may be included with the report but is not required. The Director of Finance/Treasurer shall include in the monthly reports for September, December, March and June a calculation of interest income for the quarter and the comparison of the portfolio yield to the benchmark described in Section 15.1.

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20 1819.0 Investment Policy Adoption:

This Investment Policy shall remain in full force and effect until such time as the City Council amends this policy. The City Manager will submit the Investment Policy to the City Council for review and adoption on an annual basis within 120 days of the end of the fiscal year.

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21 GLOSSARY

AGENCIES: Federal agency securities.

ASKED: The price at which securities are offered. (The price at which a firm will sell a security to an investor.)
ASSET BACKED SECURITIES. Securities supported by pools of installment loans or leases or by pools of revolving lines of credit.

BANKERS’ ACCEPTANCE (BA): A draft or bill or exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill, as well as the issuer.

The drafts are drawn on a bank by an exporter or importer to obtain funds to pay for specific merchandise. An acceptance is a high-grade negotiable instrument.

BASIS POINT: One one-hundredth of a percent (i.e., 0.01 %) BID: The price offered by a buyer of securities. (When you are selling securities, you ask for a bid.)
BROKER: A broker brings buyers and sellers together for a commission. He does not take a position.

CERTIFICATE OF DEPOSIT (CD): A time deposit with a specific maturity evidenced by a certificate. Large-denomination CDs are typically negotiable.

COLLATERAL: Securities, evidence of deposit or other property, which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies.

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

COMMERCIAL PAPER: Short term unsecured promissory note issued by a corporation to raise working capital. These negotiable instruments are purchased at a discount to par value or at par value with interest bearing. Commercial paper is issued by corporations such as General Motors Acceptance Corporation, IBM, Bank of America, etc.

COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR): The official annual financial report for the City. It includes combined statements and basic financial Item 1G - Page 26

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22 statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP).

COUPON: a) The annual rate of interest that a bond’s issuer promises to pay the bondholder on the bond’s face value. b) A certificate attached to a bond evidencing interest due on a payment date.

DEALER: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his own account.

DEBENTURE: A bond secured only by the general credit of the issuer.

DELIVERY VERSUS PAYMENT: There are two methods of delivery of securities:
delivery versus payment and delivery versus receipt. Delivery versus payment is delivery of securities with an exchange of money for the securities. Delivery versus receipt is delivery of securities with an exchange of a signed receipt for the securities.

DISCOUNT: The difference between the cost price of a security and its maturity when quoted at lower than face value. A security selling below original offering price shortly after sale also is considered to be at a discount.

DISCOUNT SECURITIES: Non -interest bearing money market instruments that are issued at a discount and redeemed at maturity for full face value (e.g., U.S. Treasury Bills).

DIVERSIFICATION: Dividing investment funds among a variety of securities offering independent returns.

DURATION: A measure of the sensitivity of the price (value of principal) of a fixed-income investment to a change in interest rates over a period of time. Duration is expressed by a number of years. Stagnant or falling interest rates may result in the duration of an investment being shorter than the stated maturity date.

FEDERAL CREDIT AGENCIES: Agencies of the Federal government set up to supply credit to various classes of institutions (e.g., S&Ls, small business firms, students, farmers, farm cooperatives, and exporters).

FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC): A Federal agency that insures bank deposits, currently up to $250,000 per deposit.

FEDERAL FUNDS RATE: The rate of interest at which Federal funds are traded. This rate is currently pegged by the Federal Reserve though open-market operations.

FEDERAL HOME LOAN BANKS (FHLB): The institutions that regulate and lend to savings and loan associations. The Federal Home Loan Banks play a role analogous to Item 1G - Page 27

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23 that played by the Federal Reserve Banks vis-a-vis member commercial banks.

FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC): Created to promote the development of a nationwide secondary market in mortgages. It does this by purchasing residential mortgages from financial institutions insured by an agency of the federal government and selling its interest in them through mortgage backed securities.

The interest and principal payments from the mortgages pass through to the investors either monthly, semiannually or annually.

FEDERAL LAND BANK (FLB): Long-term mortgage credit provided to farmers by Federal Land Banks. These bonds are issued at irregular times for various maturities ranging from a few months to ten years.

FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA): FNMA, like GNMA was chartered under the Federal National Mortgage Association Act in 1938. FNMA is a Federal corporation working under the auspices of the Department of Housing and Urban Development (HUD). It is the largest single provider of residential mortgage funds in the United States. Fannie Mae, as the corporation is called, is a private stockholder -owned corporation. The corporation’s purchases include a variety of adjustable mortgages and second loans, in addition to fixed-rate mortgages. FNMA’s securities are highly liquid and are widely accepted. FNMA assumes and guarantees that all security holders will receive timely payment of principal and interest.

FEDERAL OPEN MARKET COMMITTEE (FOMC): Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member, while the other presidents serve on a rotating basis. The committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money.

FEDERAL RESERVE SYSTEM: The central bank of the United States created by Congress and consisting of a seven- member Board of Governors in Washington, D.C.; 12 regional banks and about 5,700 commercial banks are members of the system.

GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA OR GINNIEMAE):

Securities influencing the volume of bank credit guaranteed by GNMA and issued by mortgage bankers, commercial banks, savings and loan associations and other institutions. Security holder is protected by full faith and credit of the U.S. Government.

Ginnie Mae securities are backed by the FHA or VA mortgages. The term “pass-through” is often used to describe Ginnie Mae securities.

LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash Item 1G - Page 28

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24 without a substantial loss of value. In the money market, a security is said to be liquid if the spread between bid and asked prices is narrow and reasonable size can be done at those quotes.

LOCAL GOVERNMENT INVESTMENT POOL (LGIP): The aggregate of all funds from political subdivisions that are placed in the custody of the State Treasurer for investment and reinvestment.

MARKET VALUE: The price at which a security is trading and could presumable be purchased or sold.

MARKET REPURCHASE AGREEMENT: A written contract covering all future transactions between the parties to repurchase- reverse agreements that establish each party’s rights in the transactions. A master agreement will often specify, among other things, the right of the buyer- lender to liquidate the underlying securities in the event of default by the seller- borrower.

MATURITY: The date upon which the principal or stated value of an investment becomes due and payable. The investment’s term or remaining maturity is measured from the settlement date to final maturity.

MORTGAGE PASS-THROUGH SECURITIES. A securitized participation in the interest and principal cash flows from a specified pool of mortgages. Principal and interest payments made on the mortgages are passed through to the holder of the security NEGOTIABLE CERTIFICATES OF DEPOSIT: Unsecured obligations of the financial institution, bank or savings and loan, bought at par value with the promise to pay face value plus accrued interest at maturity. They are high- grade negotiable instruments, paying a higher interest rate than regular certificates of deposit.

OFFER: The price asked by a seller of securities. (When you are buying securities, you ask for an offer).

OPEN MARKET OPERATIONS: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank as directed by the FOMC in order to influence the volume of money and credit in the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit: Sales have the opposite effect. Open market operations are the Federal Reserve’s most important and most flexible monetary Policy tool.

PORTFOLIO: Collection of securities held by an investor.

PRIMARY DEALER: A group of government securities dealers who submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Item 1G - Page 29

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25 Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC) registered securities broker/dealers, banks and a few unregulated firms.

PRUDENT PERSON RULE: An investment standard. In some states, the law requires that a fiduciary, such as a trustee, may invest money only in a list of securities selected by the custody state-the so - called “legal list”. In other states, the trustee may invest in a security if it is one that would be bought by a prudent person of discretion and intelligence who is seeking a reasonable income and preservation of capital.

RATE OF RETURN: The yield obtainable on a security based on its purchase price or its current market price.

REPURCHASE AGREEMENT (RP OR REPO): A holder of securities sells these securities to an investor with an agreement to repurchase them at a fixed date. The security “buyer” in effect lends the “seller” money for the period of the agreement, and the terms of the agreement are structured to compensate him for this. Dealers use RP extensively to finance their position. Exception: when the Fed is said to be doing RP, it is lending money that is, increasing bank reserves.

SAFEKEEPING: A service to customers rendered by banks for a fee whereby securities and valuables of all types and descriptions are held in the bank’s vaults for protection.

SUPRANATIONALS: Development banks that share the same goal of providing an improved standard of living in their member countries, but each having different mandates. There are three banks (Supranationals) in which California local agencies can invest their debt obligations; the International Bank for Reconstruction and Development (IBRD), International Finance Corporation (IFC) and Inter-American Development Bank.

STUDENT LOAN ASSOCIATION NOTES (SLMA or SALLIE MAE): A U.S. Corporation and instrumentality of the U.S. Government. Through its borrowings, funds are targeted for loans to students in higher education institutions. SLMA securities are highly liquid and are widely accepted.

SMALL BUSINESS ADMINISTRATION (SBA): The portion of these securities which are guaranteed by the Federal government to provide financial assistance through direct loans and loan guarantees to small businesses. Cash flows from these instruments may not be in equal installments because of prepayments.

SECONDARY MARKET: A market made for the purchase and sale of outstanding issues following the initial distribution.

SECURITIES & EXCHANGE COMMISSION: Agency created by Congress to protect Item 1G - Page 30

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26 investors in securities transactions by administering securities legislation.

SEC RULE 15C3-1: See “Uniform Net Capital Rule”.

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

TENNESSEE VALLEY AUTHORITIES (TVA): A U.S. Corporation created in the 1930s to electrify the Tennessee Valley area; currently a major utility headquartered in Knoxville, Tennessee. TVA securities are highly liquid and are widely accepted.

TREASURY BILLS: A non-interest bearing discount security issued by the U.S. Treasury to finance the national debt. Most bills are issued to mature in three months, six months, or one year.

TREASURY BOND: Long-term U.S. Treasury securities having initial maturities of more than10 years.

TREASURY NOTES: Intermediate-term coupon bearing U.S. Treasury having initial maturities of one year to ten years.

UNIFORM NET CAPITAL RULE: Securities and Exchange Commission requirement that member firms as well as nonmember broker/dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm, including margin loans and commitments to purchase securities, one reason new public issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash.

YIELD: The rate of annual income return on an investment, expressed as a percentage. (a) Income Yield is obtained by dividing the current dollar income by the current market price for the security. (b) Net Yield or Yield to Maturity is the current income yiel d minus any premium above par or plus any discount from par in purchase price, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond.

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2 1.0 Purpose:

2.0 Policy:

The investment Policy and practices of the City of Palm Springs are based upon state law and prudent money management consistent with City policies. The primary goals of these practices are:

A. To ensure compliance with all Federal, State, and local laws governing the investment of public funds under the control of the Director of Finance/Treasurer.

B. To protect the principal of monies entrusted to the City’s Finance Department.

C. Achieve a reasonable rate of return within the parameters of prudent risk management while minimizing the potential for capital losses arising from market changes or issuer default.

3.0 Scope:

This Investment Policy applies to all financial assets of the City of Palm Springs. These funds are accounted for in the City’s Comprehensive Annual Financial Report.

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4.0 Prudence:

4.1 Personal Responsibility:

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4 5.0 Objective:

6.0 Delegation of Authority:

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5 and a fiduciary subject to the prudent investor standard.

7.0 Ethics and Conflicts of Interest:

8.0 Authorized Financial Dealers and Institutions:

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9.0 Cash and Investment Instruments:

Exceptions can only be approved by the City Council. The investment instruments and Item 1G - Page 38

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7 percentage of the portfolio permitted by this policy are described below. Investments not specifically listed below are deemed inappropriate and prohibited.

BONDS ISSUED BY THE CITY OR ANY LOCAL AGENCY WITHIN THE STATE OF

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PASS-THROUGH SECURITIES
Asset-Backed, Mortgage-Backed, Mortgage Pass-Through Securities, and Collateralized Mortgage Obligations from issuers not defined as Obligations of the United States Treasury or Federal Agencies. The securities are rated in a rating category of “AA” or its equivalent or higher by a NRSRO with a final maturity not exceeding five years. The aggregate investment in mortgage-backed and asset-backed securities described in this section shall not exceed 20% of the portfolio with no more than 5% held in any one issuer that is not a US government agency.

• Maximum Maturity: 5 Years
• Maximum Percentage of Portfolio: 20%
• Maximum Exposure: 5% per Issuer

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INVESTMENT POLICY AND GUIDELINES

The California Government Code Section 53601 (k) (2) permits public agencies to invest in “shares of beneficial interest issued by diversified management companies that are money market funds registered with the Securities and Exchange Commission under the Investment Company Act of 1940 (15 U.S.C. Sec. 80a- 1, et seq.) as long as the company shall have met either of the following criteria: (A) Attained the highest ranking or the highest letter and numerical rating provided by not les s than two nationally recognized statistical rating organizations or (B) Retained an investment advisor registered or exempt from registration with the Securities and Exchange Commission with no less than five years’ experience investing in the securities and obligations authorized by subdivisions (a) to (j), inclusive, or subdivisions (m) or (n) and with assets under management in excess of five hundred million dollars ($500,000,000).” • Maximum Percentage of Portfolio invested in shares of any one mutual fund: 10% • Maximum Percentage of Portfolio invested in shares of any one Money Market Mutual Fund: 20%

LOCAL GOVERNMENT INVESTMENT POOLS
The California Government Code Section 53601 (p) permits public agencies to invest in “shares of beneficial interest issued by a joint powers authority organized pursuant to Section 6509.7 that invests in the securities and obligations authorized in subdivisions (a) to (o), inclusive. Each share shall represent an equal proportional interest in the underlying pool of securities owned by the joint powers authority. To be eligible under this section, the joint powers authority issuing the shares shall have retained an investment adviser that meets all of the following criteria: (1) The adviser is registered or exempt from registration with the Securities and Exchange Commission; (2) The adviser has not less than five years of experience investing in the securities and obligations authorized in subdivisions (a) to (o), inclusive; and (3) The adviser has assets under management in excess of five hundred million dollars ($500,000,000).” • Maximum Percentage of Portfolio in LGIPs: 20%
TIME DEPOSITS-CERTIFICATES OF DEPOSIT (non-negotiable certificates of deposit.) Item 1G - Page 42

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INVESTMENT POLICY AND GUIDELINES

11 Time deposits, non- negotiable and collateralized in accordance with the California Government Code, may be purchased through banks or savings and loan associations with a rating category of “A” or better rating.
• Maximum Maturity: 5 Year
• Maximum Percentage of Portfolio: 20%
• Maximum Exposure: Limited to the maximum covered under federal insurance NEGOTIABLE CERTIFICATES OF DEPOSIT (NCDs)
NCDs issued by a nationally or state-chartered bank, a savings association or a federal association, a state or federal credit union, or by a federally licensed or state-licensed branch of a foreign bank may be purchased. Investments under this subdivision shall be rated in a rating category of “A” or its equivalent or higher by a NRSRO and shall not exceed 30% of the portfolio with no more than 5% invested in any one issuer. • Maximum Maturity: 5 Year
• Maximum Percentage of Portfolio: 30%
• Maximum Exposure: 5% per issuer

REPURCHASE AGREEMENTS
Repurchase Agreements collateralized with securities authorized under California Government Code, maintained at a level of at least 102% of the market value of the Repurchase Agreement. There are no limits on the dollar amount or percentage that the City m ay invest, provided that the securities used as collateral for Repurchase Agreements will be delivered to an acceptable third- party custodian. Repurchase Item 1G - Page 43

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INVESTMENT POLICY AND GUIDELINES

12 Agreements are subject to a Master Repurchase Agreement between the City and the provider of the repurchase agreement. The Master Repurchase Agreement will be substantially in the form developed by the Securities Industry and Financial Markets Association (SIFMA).
• Maximum Maturity: Does not exceed 1 Year

Before soliciting bids from providers of GIC's, IA's, or SP’s, the Director of Finance/Treasurer shall obtain approval from the City Council to proceed.

9.2 Investment Pools:

9.3 Prohibited Investments:

Under the provisions of California Government Code Sections 53601.6 and 53631.5, the City of Palm Springs shall not invest any funds covered by this Investment Policy in inverse floaters, dual index, stepped inverse derivatives, reverse repurchase agreements, range notes, interest-only strips derived from mortgage pools, stock in any joint company, corporation or association; securities with a forward settlement date exceeding 45 days; or any investment that may result in a zero interest accrual if held to maturity. Under a provision sunsetting on January 1, 2026, securities backed by the U.S. Government that could result in a zero- or negative-interest accrual if held to maturity are permitted. Trading Item 1G - Page 44

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INVESTMENT POLICY AND GUIDELINES

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

9.4 Social Responsibility:

10.0 Collateralization:

Repurchase Agreements
Item 1G - Page 45

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14 The City requires that Repurchase Agreements be collateralized only by securities authorized in accordance with California Government Code. The securities which collateralize the repurchase agreement shall be priced at Market Value, including any Accrued Interest plus a margin. The Market Value of the securities that underlie a repurchase agreement shall be valued at 102% or greater of the funds borrowed against those securities. Financial institutions shall mark the value of the collateral to market at least monthly and increase or decrease the collateral to satisfy the ratio requirement described above. The City shall receive monthly statements of collateral

11.0 Safekeeping and Custody:

CITY OF PALM SPRINGS

INVESTMENT POLICY AND GUIDELINES

15 • A fee schedule, and when and how it is assessed.
• Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds?

13.0 Risk Management and Diversification

• No more than 5% of the total portfolio may be deposited with or invested in securities issued by any single issuer unless otherwise specified in this policy.

• If a security owned by the City is downgraded to a level below the requirements of this policy, making the security ineligible for additional purchases, the Director of Finance/Treasurer will use discretion in determining whether to sell or hold the security based on its current maturity, the economic outlook for the issuer, and other relevant factors. If a decision is made to retain a downgraded security in the portfolio, its presence in the portfolio will be monitored and reported monthly to the City Council.

CITY OF PALM SPRINGS

INVESTMENT POLICY AND GUIDELINES

16 funds that are not needed for current cash flow purposes.

• The maximum stated final maturity of individual securities in the portfolio will be five (5) years, except as otherwise stated in this policy.

14.0 Maximum Maturities:

To the extent possible, the City will attempt to match its investments with anticipated cash flow requirements. Unless matched to a specific cash flow, the City will not directly invest in securities maturing more than five (5) years from settlement date, 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. I ndividual maturities are subject to the limitations described in Section 9.0.

15.0 Internal Control:

CITY OF PALM SPRINGS

INVESTMENT POLICY AND GUIDELINES

17 maturing of investments and allocation of investments to fund balances shall be performed by the Finance Department and approved by the Director of Finance/Treasurer.

To provide further protection of City funds, wiring of any City funds is prohibited without the authorization of one of the following designated City staff:

1. Director of Finance/Treasurer

2. Assistant Director of Finance

3. Assistant City Manager

4. City Manager

16.0 Performance Standards:

16.1 Market Yield (Benchmark):

The investment portfolio shall be managed to attain a market -average rate of return throughout budgetary and economic cycles, taking into account the City’s investment risk constraints and cash flow. Investment return becomes a consideration only after t he basic requirements of investment safety and liquidity have been met. The Finance Director/Treasurer shall establish an appropriate benchmark or benchmarks, as appropriate, for investment parameters that reflect the types and maturities of investments allowed under this policy. While the City will not make investments for the purpose of trading or speculation as the dominant criterion, the Director of Finance/Treasurer shall seek to enhance total portfolio return by means of ongoing portfolio and cash management. The prohibition of highly speculative investments precludes pursuit of gain or profit through unusual risk and precludes investments primarily directed at gains or profits from conjectural fluctuations in market prices. The Director of Finance/Treasurer will not directly pursue any investments that are leveraged or deemed derivative in nature. However, as long as the original investments can be justified by their ordinary earning power, trading in response to changes in market value can be used as part of on-going portfolio management.

17.0 Oversight Committee:

A committee comprised of two Council members appointed by Council, the City Manager and the Director of Finance/Treasurer, shall provide oversight of the City's investments.

Item 1G - Page 49

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18 The Committee shall meet quarterly to review the City’s investment activity.

18.0 Reporting:

MONTHLY REPORTS
Monthly transaction reports will be submitted by the Director of Finance/Treasury to the City Council in accordance with California Government Code Section 53607.

QUARTERLY REPORTS
The Director of Finance/Treasury will submit a quarterly investment report to the City Council which provides full disclosure of the City’s investment activities within 45 days after the end of the quarter. These reports will disclose, at a minimum, the following information about the City’s portfolio:
• An asset listing showing par value, cost and independent third-party fair market value of each security as of the date of the report, the source of the valuation, type of investment, issuer, maturity date and interest rate. • Transactions for the period.
• A description of the funds, investments and programs (including lending programs) managed by contracted parties (i.e. LAIF; investment pools, outside money managers and securities lending agents)
• A one-page summary report that shows:
o Average maturity of the portfolio and modified duration of the portfolio;
o Maturity distribution of the portfolio;
o Percentage of the portfolio represented by each investment category;
o Average portfolio credit quality; and,
o Time-weighted total rate of return for the portfolio for the prior one month, three months, twelve months and since inception compared to the City’s market benchmark returns for the same periods described in Section 16.1;
• A statement of compliance with investment policy, including a schedule of any transactions or holdings which do not comply with this policy or with the California Government Code, including a justification for their presence in the portfolio and a timetable for resolution.
• A statement that the City has adequate funds to meet its cash flow requirements for the next six months.”

19.0 Investment Policy Adoption:

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19 Item 1G - Page 51

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20 GLOSSARY

AGENCIES: Federal agency securities.

BANKERS’ ACCEPTANCE (BA): A draft or bill or exchange accepted by a bank or trust company. The accepting institution guarantees payment of the bill, as well as the issuer.

The drafts are drawn on a bank by an exporter or importer to obtain funds to pay for specific merchandise. An acceptance is a high-grade negotiable instrument.

CERTIFICATE OF DEPOSIT (CD): A time deposit with a specific maturity evidenced by a certificate. Large-denomination CDs are typically negotiable.

COLLATERAL: Securities, evidence of deposit or other property, which a borrower pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposits of public monies.

COMPREHENSIVE ANNUAL FINANCIAL REPORT (CAFR): The official annual financial report for the City. It includes combined statements and basic financial Item 1G - Page 52

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INVESTMENT POLICY AND GUIDELINES

21 statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP).

COUPON: a) The annual rate of interest that a bond’s issuer promises to pay the bondholder on the bond’s face value. b) A certificate attached to a bond evidencing interest due on a payment date.

DEALER: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his own account.

DEBENTURE: A bond secured only by the general credit of the issuer.

DISCOUNT SECURITIES: Non -interest bearing money market instruments that are issued at a discount and redeemed at maturity for full face value (e.g., U.S. Treasury Bills).

DIVERSIFICATION: Dividing investment funds among a variety of securities offering independent returns.

FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC): A Federal agency that insures bank deposits, currently up to $250,000 per deposit.

FEDERAL FUNDS RATE: The rate of interest at which Federal funds are traded. This rate is currently pegged by the Federal Reserve though open-market operations.

FEDERAL HOME LOAN BANKS (FHLB): The institutions that regulate and lend to savings and loan associations. The Federal Home Loan Banks play a role analogous to Item 1G - Page 53

CITY OF PALM SPRINGS

INVESTMENT POLICY AND GUIDELINES

22 that played by the Federal Reserve Banks vis-a-vis member commercial banks.

The interest and principal payments from the mortgages pass through to the investors either monthly, semiannually or annually.

FEDERAL LAND BANK (FLB): Long-term mortgage credit provided to farmers by Federal Land Banks. These bonds are issued at irregular times for various maturities ranging from a few months to ten years.

GOVERNMENT NATIONAL MORTGAGE ASSOCIATION (GNMA OR GINNIEMAE):

Ginnie Mae securities are backed by the FHA or VA mortgages. The term “pass-through” is often used to describe Ginnie Mae securities.

LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash Item 1G - Page 54

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23 without a substantial loss of value. In the money market, a security is said to be liquid if the spread between bid and asked prices is narrow and reasonable size can be done at those quotes.

LOCAL GOVERNMENT INVESTMENT POOL (LGIP): The aggregate of all funds from political subdivisions that are placed in the custody of the State Treasurer for investment and reinvestment.

MARKET VALUE: The price at which a security is trading and could presumable be purchased or sold.

OFFER: The price asked by a seller of securities. (When you are buying securities, you ask for an offer).

PORTFOLIO: Collection of securities held by an investor.

PRIMARY DEALER: A group of government securities dealers who submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Item 1G - Page 55

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24 Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC) registered securities broker/dealers, banks and a few unregulated firms.

RATE OF RETURN: The yield obtainable on a security based on its purchase price or its current market price.

SAFEKEEPING: A service to customers rendered by banks for a fee whereby securities and valuables of all types and descriptions are held in the bank’s vaults for protection.

SECONDARY MARKET: A market made for the purchase and sale of outstanding issues following the initial distribution.

SECURITIES & EXCHANGE COMMISSION: Agency created by Congress to protect Item 1G - Page 56

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25 investors in securities transactions by administering securities legislation.

SEC RULE 15C3-1: See “Uniform Net Capital Rule”.

TREASURY BILLS: A non-interest bearing discount security issued by the U.S. Treasury to finance the national debt. Most bills are issued to mature in three months, six months, or one year.

TREASURY BOND: Long-term U.S. Treasury securities having initial maturities of more than10 years.

TREASURY NOTES: Intermediate-term coupon bearing U.S. Treasury having initial maturities of one year to ten years.

Item 1G - Page 57

ATTACHMENT C

Item 1G - Page 58
Item 1G - Page 59
City of Palm Springs
Department of Finance and Treasmy
Palm Springs City Hall - P .0. Box 2743, Palm Springs, California 92263-2743 Tel: (760) 323-8246 * Fax (760) 322-8320 * Web: www.palmspringsca.gov April 13, 2021
To: Jayson Schmitt, CFA
Deputy Chief Investment Officer
Chandler Asset Management
6225 Lusk Blvd
San Diego, CA 92121
RE: Client Directive on Management of the City of Palm Spring's Investments The City of Palm Springs, entered into a non-discretionary investment advisory agreement (Agreement) on March 2, 2021 with Chandler Asset Management, an SEC-registered investment advisor. In accordance with the scope of work included in the contract, Chandler will manage a portion of the City's portfolio in a disciplined, active manner that complies with the City's Investment Policy, approved on April 8'h, 2021.

Following detailed consultations with Chandler's investment team, the City selected Chandler to manage the reserve portion of its portfolio in the Short Term Bond investment strategy. The strategy invests in a well diversified portfolio of US dollar denominated fixed income securities. In addition, in accordance with the City's investment policy, Chandler will also integrate ESG/SRI preferences (nto the management of the City's portfolio by working with staff to develop, implement and overlay an approved issuer list over its permitted investments.

Performance for the Short-Term Bond investment strategy will be measured against the ICE BofA 1-5 Year US Treasury & Agency Index. Because this is a non-discretionary relationship, Chandler will seek written authorization from an authorized representative of the City defined by the "Authorized Representatives Form" prior to executing trades on the City's behalf. The City's Investment Staff will work with Chandler to maintain appropriate levels of liquidity utilizing an internally managed liquidity portfolio.

This directive will remain in effect until it is replaced by a revised directive.

Ms. ncy P uley
Director of Finance and Treasurer
City of Palm Springs
Post Office Box 2743, Palm Springs, CA 92263-2743

ATTACHMENT D

Item 1G - Page 60

CITY COUNCIL STAFF REPORT

DATE: OCTOBER 14, 2021 CONSENT CALENDAR

SUBJECT: SOCIALLY RESPONSIBLE INVESTING (SRI ) AND ENVIRONMENTAL, SOCIAL GOVERNANCE INVESTING (ESG).

FROM: Justin Clifton, City Manager

BY: Department of Finance and Treasury

SUMMARY:

The City Council adopted the City Investment Policy on April 8, 2021. At that time, City Council directed staff to incorporate Socially Responsible Investing (SRI) and Environmental, Social, Governance Investing (ESG) language into the FY21- 22 Investment Policy.

SRI and ESG both consider the broader social and environmental implications of an investment.

• SRI values aligned investing primarily uses an exclusionary screening process to align portfolios with investors moral and ethical values.

• ESG values (performance) based investing primarily uses an inclusive evaluation process. This includes factors into the decision process through targeting positive impact.

RECOMMENDATION:

Receive and File.

BACKGROUND:

A growing number of local agencies in California have received requests from their governing board members to invest in “sustainable,” socially conscious,” “green,” or “ethical” investments. This practice is commonly referred to as socially responsible investing (SRI). In addition, the consideration of environmental, social, and governance Item 1G - Page 61
City Council Staff Report
October 14, 2021 -- Page 2
Socially Responsible Investing

(ESG) criteria when investing public funds is becoming more common amoung local agencies in California. The mo re general terms investors now use are: “sustainable investing,” community investing,” “ethical investing,” “green investing,” impact investing,” “mission-related investing,” “responsible investing,” and “values-based investing”.

The City of Santa Monica’s investment policy has a section “Socially Responsible Investing, which the city is directed to invest city funds in “entities that support clean and healthy environments, including following safe and environmentally sound practices,” entities that support equal rights, and “in entities that promote community economic development.”

Socially responsible investment objectives are becoming increasingly popular and may be advocated for by the stakeholders of California local agencies to discourage or encourage corporate business practices or government activities seen as negative or positive under certain environmental, social and governance factors to the public at large.

The City’s current investment policy includes the following:

9.4 Social Responsibility:

Investments should be made to the extent reasonable under the circumstances that such socially responsible investments meet minimum permitted requirements by state law, and achieve substantially equivalent safety, liquidity, and yield when compared to similar investments permitted by state law.

Staff will update the FY21-22 Investment Policy to include best practices such as:

Sustainable, Socially Conscious, Green, and Ethical.

Negative S
creening of SRI & ESG Strategies will include prohibiting:

• Tobacco Products
• Fossil Fuel
• Alcohol
Item 1G - Page 62
City Council Staff Report
October 14, 2021 -- Page 3
Socially Responsible Investing

• Gun/Weapons Manufacturing and Distribution

Positive S creening of SRI & ESG Strategies will include:

• Entities that support clean and healthy environments
• Entities that promote economic development
• Invest in local community banks with ten or less branches for amounts of $250,000 or less.
• Purchasing Green Bonds

STAFF ANALYSIS:

Staff to include additional language to include SRI , ESG, Sustainable, Socially Conscious, Green, and Ethical in FY 21-22 City Investment Policy.

FISCAL IMPACT:

None

REVIEWED B
Y:

Department Director:

Assistant City Manager:

City Manager:

ATTACHMENTS:

None
Item 1G - Page 63

ATTACHMENT E

Item 1G - Page 64
RESOLUTION NO. _____

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

PALM SPRINGS , CALIFORNIA, ADOPTING AN

INVESTMENT POLICY GOVERNING THE INVESTMENT
OF CITY FUNDS FOR FISCAL YEAR 202 4-25 AND
SUPERCEEDING RESOLUTION NO. 25123.

WHEREAS, The City Council finds the Investment Policy is consistent with the City’s commitment to safeguarding public funds; and
WHEREAS, The City of Palm Springs Investment Policy, Attachment 2 and incorporated by reference, is hereby adopted; and
WHEREAS, Resolution No. 25123 is hereby superseded in its entirety.

PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council of the City of Palm Springs on this ____ day of ________________, 2024.

JEF FREY BERNSTEIN
MAYOR
ATTEST:

BRENDA PREE

CITY CLERK
CE

RTIFICATION

STATE OF CALIFORNIA )
COUNTY OF RIVERSIDE ) ss.

CITY OF PALM SPRINGS )
I, BRENDA PREE , C ity Clerk of the City of Palm Springs, h ereby certify that Resolution No. ____ is a full, true and correct copy, and was duly adopted at a regular meeting of the City Council of the City of Palm Springs on _______________________, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

Item 1G - Page 65
Resolution No. _____

Page 2 ends

IN WITNESS WHEREOF , I have hereunto set my hand and affixed the official seal of the City of Palm Springs, California, this ______ day of ______________, _________.

BRENDA PREE

CITY CLERK
Item 1G - Page 66

CITY COUNCIL STAFF REPORT

DATE: MAY 9, 2024 CONSENT CALENDAR

SUBJECT: APPROVE CONTRACT SERVICES AGREEMENT NO. 2 4B082 WITH ONYX PAVING COMPANY, INC. FOR ON-CALL ASPHALT REPAIR AND

REPLACEMENT SERVICES

FROM: Scott C. Stiles, City Manager

BY: David McAbee, Director of Public Works

SUMMARY:

This action will approve Agreement No. 24B082 with Onyx Paving Company, Inc., in an amount not to exceed $900,000 for on-call asphalt repair and replacement services.

RECOMMENDATION:

1. Approve Contract Services Agreement 24B082 (Attachment A) with Onyx Paving Company, Inc. to provide on- call asphalt repair and replacement services in an amount not to exceed $900,000 for the initial three- year term beginning May 13, 2024 through May 12, 2027, with two one-year extension options at the City’s sole discretion; and

2. Authorize the City Manager or designee to execute all necessary documents.

BUSINESS PRINCIPAL DISCLOSURE:

According to the Public Integrity Disclosure form ( Attachment B) submitted on April 11, 2024, Onyx Paving Company, Inc. is registered in the state of California.

BACKGROUND:

The City requires On -Call Asphalt Repair and Replacement Services for its 208- centerline-roadway miles, gutters, sidewalks, and parking lots.

As part of routine street maintenance services, the Street Maintenance division strives to make repairs by way of pothole filling as a short-term solution for City owned streets and parking lots citywide. During the Fiscal Year 2023-24 and 2024-25 budget process, Public Works requested and was approved an increased budget to retain on- call asphalt repair Item 1H - Page 1
City Council Staff Report
May 9, 2024 -- Page 2
Award On-Call Citywide Asphalt Repair and Replacement Services Contract

and replacement services to provide for the implementation of routine refreshing of City owned streets and parking lots.

STAFF ANALYSIS:

The contract with Onyx Paving Company, Inc. is an on-call, as-needed type contract. The bids were used to determine the lowest, responsive, responsible bidder and to set the unit rates for the contract; however, the actual amount of the contract is based on the budgeted amount set by the Department and will therefore not match the bid amounts.

An Invitation for Bids (IFB 24-03) was initiated by the City’s Procurement and Contracting Department on March 18, 2024, based on the Department of Public Works specifications.

Bids were solicited directly via the City’s procurement vendor portal, PlanetBi ds. In addition, the IFB was advertised in The Desert Sun. Three bids were received by the April 11, 2024, deadline as follows:

Vendor Bid
Onyx Paving Company, Inc. – Anaheim, CA $777,000.00
B-81 Paving Inc. – Yucaipa, CA $807,480.00
Granite Construction Company – Indio, CA $809,700.00

The unit pricing is fixed for the first year and subject to a CPI increase in the following years. Staff recommends approval of Contract Services Agreement No. 24B082 with Onyx Paving Company, Inc. for the initial three- year term in the amount not to exceed $900,000 effective May 13, 2024, through May 12, 2027, subject to two one-year optional renewals at the sole discretion of the City.

ENVIRONMENTAL ASSESSMENT
:

The requested City Council action is not a “Project” as defined by the California Environmental Quality Act (CEQA). Pursuant to Section 15378(a), a “Project” means the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. The requested action is to approve contracts for the above- mentioned services, and is exempt from CEQA pursuant to Section 15378(b), in that a “Project” does not include: (5) Organizational or administrative activities of governments that will not result in direct or indirect physical changes in the environment.

ALIGNMENT WITH STRATEGIC PLANNING:

Approval of this action supports City Council priority 2, Community Infrastructure.

Item 1H - Page 2
City Council Staff Report
May 9, 2024 -- Page 3
Award On-Call Citywide Asphalt Repair and Replacement Services Contract

FISCAL IMPACT:

Sufficient funds are budgeted and available in the Fiscal Year 2023- 24 and 2024- 25, Measure A 1343085-80000 and 1006515-40105.

REVIEWED BY:

Assistant Director of Maintenance and Facilities: Daniel Martinez Director of Public Works: David McAbee
Director of Procurement and Contracting: Kim Baker
Assistant City Manager: Teresa Gallavan
City Manager: Scott Stiles

ATTACHMENTS:

A. Contract Service Agreement No. 24B082
B. Public Integrity Disclosure Form

Item 1H - Page 3

ATTACHMENT A

Item 1H - Page 4

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CONTRACT SERVICES AGREEMENT 24B082

ON-CALL ASPHALT REPAIR AND REPLACMENT SERVICES

THIS AGREEMENT FOR CONTRACT SERVICES (“Agreement”) is made and entered into on May 13, 2024 , by and between the City of Palm Springs, a California charter city and municipal corporation (“City”), and Onyx Paving Company, Inc. , a California Corporation , (“Contractor”). City and Contractor are individually referred to as “Party” and are collectively referred to as the “Parties”.

RECITALS
A. City requires the services of a licensed and qualified firm to provide on- call asphalt repair and replacement services, (“Project”).

B. Contractor has submitted to City a Bid to provide on-call asphalt repair and replacement services, under the terms of this Agreement.

C. Based on its experience, education, training, and reputation, Contractor is qualified and desires to provide the necessary services to City for the Project.

D. City desires to retain the services of Contractor for the Project.

NOW, THEREFORE, in consideration of the promises and mutual obligations, covenants, and conditions contained herein, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

AGREEMENT

1. CONTRACTOR SERVICES

1.1 Scope of Services. In compliance with all terms and conditions of this Agreement, Contractor shall provide services to City as described in the Scope of Services/Work attached to this Agreement as Exhibit “A” and incorporated herein by reference (the “Services” or “Work”) . Exhibit "A" includes the agreed upon schedule of performance and the schedule of fees . Contractor warrants that the Services shall be performed in a competent, professional, and satisfactory manner consistent with the level of care and skill ordinarily exercised by high quality, experienced, and well qualified members of the profession currently practicing under similar conditions . In the event of any inconsistency between the terms contained in the Scope of Services/Work and the terms set forth in this Agreement, the terms set forth in this Agreement shall govern.

1.2 Compliance with Law. Contractor shall comply with all applicable federal, state, and local laws, statutes and ordinances and all lawful orders, rules, and regulations when performing the Services. Contractor shall be liable for all violations of such laws and regulations in connection with the Services and this Agreement.

1.3 Licenses and Permits. Contractor shall obtain at its sole cost and expense such licenses, permits, and approvals as may be required by law for the performance of the Services required by this Agreement.

1.4 Familiarity with Work. By executing this Agreement, Contractor warrants that it has carefully considered how the Work should be performed and fully understands the facilities, difficulties, and restrictions attending performance of the Work under this Agreement.

2. TIME FOR COMPLETION
Item 1H - Page 5

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The time for completion of the Services to be performed by Contractor is an essential condition of this Agreement . Contractor shall prosecute regularly and diligently the work of this Agreement according to the agreed upon schedule of performance set forth in Exhibit “A.” Neither Party shall be accountable for delays in performance caused by any condition beyond the reasonable control and without the fault or negligence of the non -performing Party. Delays shall not entitle Contractor to any additional compensation regardless of the Party responsible for the delay.

3. COMPENSATION OF CONTRACTOR

3.1 Compensation of Contractor . Contractor shall be compensated and reimbursed for the services rendered under this Agreement in accordance with the schedule of fees set forth in Exhibit “A”. The total amount of Compensation shall not exceed $900,000.00.

3.2 Method of Payment . In any month in which Contractor wishes to receive payment, Contractor shall submit to City an invoice for Services rendered prior to the date of the invoice, no later than the first working day of such month, in the form approved by City’s finance director. Payments shall be based on the hourly rates set forth in Exhibit “A” for authorized services performed. City shall pay Contractor for all expenses stated in the invoice that are approved by City and consistent with this Agreement, within thirty (30) days of receipt of Contractor’s invoice.

3.3 Changes. In the event any change or changes in the Services is requested by City, Parties shall execute a written amendment to this Agreement, specifying all proposed amendments, including, but not limited to, any additional fees . An amendment may be entered into:

A. To provide for revisions or modifications to documents, work product, or Work, when required by the enactment or revision of any subsequent law; or B. To provide for additional services not included in this Agreement or not customarily furnished in accordance with generally accepted practice in Contractor’s profession.

3.4 Appropriations. This Agreement is subject to, and contingent upon, funds being appropriated by the City Council of City for each fiscal year . If such appropriations are not made, this Agreement shall automatically terminate without penalty to City.

4. PERFORMANCE SCHEDULE

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

4.2 Schedule of Performance. All Services rendered under this Agreement shall be performed under the agreed upon schedule of performance set forth in Exhibit “A.” Any time period extension must be approved in writing by the Contract Officer.

4.3 Force Majeure. The time for performance of Services to be rendered under this Agreement may be extended because of any delays due to a Force Majeure Event if Contractor notifies the Contract Officer within ten (10) days of the commencement of the Force Majeure Event. A Force Majeure Event shall mean an event that materially affects the Contractor’s performance and is one or more of the following: (1) Acts of God or other natural disasters occurring at the project site; (2) terrorism or other acts of a public enemy; (3) orders of governmental authorities (including, without limitation, unreasonable and unforeseeable delay in the issuance of permits or approvals by governmental authorities that are required for the Work); and (4) pandemics, epidemics or quarantine restrictions. For purposes of this section, “orders of governmental authorities,” includes ordinances, emergency proclamations and orders, rules to protect the public health, welfare and safety, and other actions of the City in its capacity as a municipal authority . After Contractor notification, the Contract Officer shall investigate the facts and the extent of any necessary delay, and extend the time for performing the Services for the period of the enforced delay when and if, in the Contract Officer’s judgment, Item 1H - Page 6

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such delay is justified. The Contract Officer’s determination shall be final and conclusive upon the Parties to this Agreement . The Contractor will not receive an adjustment to the contract price or any other compensation. Notwithstanding the foregoing, the City may still terminate this Agreement in accordance with the termination provisions of this Agreement.

4.4 Term. Unless earlier terminated in accordance with Section 4.5 of this Agreement, this Agreement shall continue in full force and effect for a period of three years, commencing on May 13, 2024, and ending on May 12, 2027, unless extended by mutual written agreement of the Parties. In addition, the term may be extended at the sole discretion of the City upon written notice to the Contractor, for two (2) additional one (1) year terms.

4.5 Termination Prior to Expiration of Term. City may terminate this Agreement at any time, with or without cause, upon thirty (30) days written notice to Contractor . Where termination is due to the fault of Contractor and constitutes an immediate danger to health, safety, and general welfare, the period of notice shall be such shorter time as may be determined by the City . Upon receipt of the notice of termination, Contractor shall immediately cease all Services except such as may be specifically approved by the Contract Officer .

Contractor shall be entitled to compensation for all Services rendered prior to receipt of the notice of termination and for any Services authorized by the Contract Officer after such notice .

City shall not be liable for any costs other than the charges or portions thereof which are specified herein. Contractor shall not be entitled to payment for unperformed Services and shall not be entitled to damages or compensation for termination of Work . If the termination is for cause, the City shall have the right to take whatever steps it deems necessary to correct Contractor's deficiencies and charge the cost thereof to Contractor, who shall be liable for the full cost of the City's corrective action. Contractor may not terminate this Agreement except for cause, upon thirty (30) days written notice to City.

5. COORDINATION OF WORK

5.1 Representative of Contractor . The following principal of Contractor is designated as being the principal and representative of Contractor authorized to act and make all decisions in its behalf with respect to the specified Services: Corey R. Kirschner, CEO, President, Vice President, Secretary, Treasurer . It is expressly understood that the experience, knowledge, education, capability, and reputation of the foregoing principal is a substantial inducement for City to enter into this Agreement . Therefore, the foregoing principal shall be responsible during the term of this Agreement for directing all activities of Contractor and devoting sufficient time to personally supervise the Services under this Agreement . The foregoing principal may not be changed by Contractor without prior written approval of the Contract Officer.

5.2 Contract Officer . The Contract Officer shall be the City Manager or his/her designee ("Contract Officer") . Contractor shall be responsible for keeping the Contract Officer fully informed of the progress of the performance of the Services. Contractor shall refer any decisions that must be made by City to the Contract Officer . Unless otherwise specified, any approval of City shall mean the approval of the Contract Officer.

5.3 Prohibition Against Subcontracting or Assignment . The experience, knowledge, education, capability, and reputation of Contractor, its principals, and employees, were a substantial inducement for City to enter into this Agreement . Contractor shall not contract with any other individual or entity to perform any Services required under this Agreement without the City's express written approval . In addition, neither this Agreement nor any interest may be assigned or transferred, voluntarily or by operation of law, without the prior written approval of City. Subcontracts, if any, shall contain a provisions making them subject to all provisions stipulated in this Agreement including without limitation the insurance and indemnification requirements . If Contractor is permitted to subcontract any part of this Agreement by City, Contractor shall be responsible to City for the acts and omissions of its Item 1H - Page 7

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subcontractor(s) in the same manner as it is for persons directly employed. Nothing contained in this Agreement shall create any contractual relationships between any subcontractor and City.

5.4 Independent Contractor. Neither City nor any of its employees shall have any control over the manner, mode, or means by which Contractor, its agents, or employees, perform the Services required, except as otherwise specified. Contractor shall perform all required Services as an independent contractor of City and shall not be an employee of City and shall remain at all times as to City a wholly independent contractor with only such obligations as are consistent with that role; however, City shall have the right to review Contractor’s work product, result, and advice. Contractor shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of City . Contractor shall pay all wages, salaries, and other amounts due personnel in connection with their performance under this Agreement and as required by law . Contractor shall be responsible for all reports and obligations respecting such personnel, including, but not limited to: social security taxes, income tax withholding, unemployment insurance, and workers’ compensation insurance. Contractor shall not have any authority to bind City in any manner.

5.5 Personnel. Contractor agrees to assign the following individuals to perform the services in this Agreement. Contractor shall not alter the assignment of the following personnel without the prior written approval of the Contract Officer . Acting through the City Manager, the City shall have the unrestricted right to order the removal of any personnel assigned by Contractor by providing written notice to Contractor.

Name: Title:
(to be determined)

5.6 California Labor Code Requirements.

A. Contractor is aware of the requirements of California Labor Code Sections 1720 et seq. and 1770 et seq., which require the payment of prevailing wage rates and the performance of other requirements on certain “public works” and “maintenance” projects (“Prevailing Wage Laws”) . If the Services are being performed as part of an applicable “public works” or “maintenance” project, as defined by the Prevailing Wage Laws, and if the total compensation is $15,000 or more for maintenance or $25,000 or more for construction, alteration, demolition, installation, or repair, Contractor agrees to fully comply with such Prevailing Wage Laws . Contractor shall defend, indemnify, and hold the City, its officials, officers, employees, and agents free and harmless from any claims, liabilities, costs, penalties, or interest arising out of any failure or alleged failure to comply with the Prevailing Wage Laws .

It shall be mandatory upon the Contractor and all subcontractors to comply with all California Labor Code provisions, which include but are not limited to prevailing wages (Labor Code Sections 1771, 1774 and 1775), employment of apprentices (Labor Code Section 1777.5), certified payroll records (Labor Code Sections 1771.4 and 1776), hours of labor (Labor Code Sections 1813 and 1815) and debarment of contractors and subcontractors (Labor Code Section 1777.1).

B. If the Services are being performed as part of an applicable “public works” or “maintenance” project and if the total compensation is $15,000 or more for maintenance or $25,000 or more for construction, alteration, demolition, installation, or repair, then pursuant to Labor Code Sections 1725.5 and 1771.1, the Contractor and all subcontractors performing such Services must be registered with the Department of Industrial Relations . Contractor shall maintain registration for the duration of the Project and require the same of any subcontractors, as applicable. This Agreement may also be subject to compliance monitoring and enforcement by the Department of Industrial Relations . It shall be Contractor’s sole responsibility to comply with all applicable registration and labor compliance requirements.

6. INSURANCE
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Contractor shall procure and maintain, at its sole cost and expense, policies of insurance as set forth in the attached Exhibit "B", incorporated herein by reference.

7. INDEMNIFICATION.

7.1 Indemnification. To the fullest extent permitted by law, Contractor shall defend (at Contractor’s sole cost and expense), indemnify, protect, and hold harmless City, its elected officials, officers, employees, agents, and volunteers (collectively the “Indemnified Parties”), from and against any and all liabilities, actions, suits, claims, demands, losses, costs, judgments, arbitration awards, settlements, damages, demands, orders, penalties, and expenses including legal costs and attorney fees (collectively “Claims”), including but not limited to Claims arising from injuries to or death of persons (Contractor’s employees included), for damage to property, including property owned by City, for any violation of any federal, state, or local law or ordinance or in any manner arising out of, pertaining to, or incident to any acts, errors or omissions, or willful misconduct committed by Contractor, its officers, employees, representatives, and agents, that arise out of or relate to Contractor’s performance of Services or this Agreement. This indemnification clause excludes Claims arising from the sole negligence or willful misconduct of the Indemnified Parties . Under no circumstances shall the insurance requirements and limits set forth in this Agreement be construed to limit Contractor’s indemnification obligation or other liability under this Agreement . Contractor’s indemnification obligation shall survive the expiration or earlier termination of this Agreement until all actions against the Indemnified Parties for such matters indemnified are fully and finally barred by the applicable statute of limitations or, if an action is timely filed, until such action is final.

7.2 Design Professional Services Indemnification and Reimbursement. If Contractor’s obligation to defend, indemnify, and/or hold harmless arises out of Contractor’s performance as a “design professional” (as that term is defined under Civil Code section 2782.8), then, and only to the extent required by Civil Code section 2782.8, which is fully incorporated herein, Contractor’s indemnification obligation shall be limited to the extent which the Claims arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Contractor in the performance of the Services or this Agreement, and, upon Contractor obtaining a final adjudication by a court of competent jurisdiction, Contractor’s liability for such claim, including the cost to defend, shall not exceed the Contractor’s proportionate percentage of fault.

8. RECORDS AND REPORTS

8.1 Reports. Contractor shall periodically prepare and submit to the Contract Officer reports concerning the performance of the Services required by this Agreement, or as the Contract Officer shall require.

8.2 Records. Contractor shall keep complete, accurate, and detailed accounts of all time, costs, expenses, and expenditures pertaining in any way to this Agreement . Contractor shall keep such books and records as shall be necessary to properly perform the Services required by this Agreement and enable the Contract Officer to evaluate the performance of such Services. The Contract Officer shall have full and free access to such books and records at all reasonable times, including the right to inspect, copy, audit, and make records and transcripts from such records.

8.3 Ownership of Documents. All drawings, specifications, reports, records, documents, and other materials prepared by Contractor in the performance of this Agreement shall be the property of City . Contractor shall deliver all above- referenced documents to City upon request of the Contract Officer or upon the termination of this Agreement . Contractor shall have no claim for further employment or additional compensation as a result of the exercise by City of its full rights or ownership of the documents and materials . Contractor may retain copies of such documents for Contractor's own use. Contractor shall have an unrestricted right to use the concepts embodied in such documents.

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8.4 Release of Documents. All drawings, specifications, reports, records, documents, and other materials prepared by Contractor in the performance of Services under this Agreement shall not be released publicly without the prior written approval of the Contract Officer.

8.5 Audit and Inspection of Records. After receipt of reasonable notice and during the regular business hours of City, Contractor shall provide City, or other agents of City, such access to Contractor’s books, records, payroll documents, and facilities as City deems necessary to examine, copy, audit, and inspect all accounting books, records, work data, documents, and activities directly related to Contractor’s performance under this Agreement .

Contractor shall maintain such books, records, data, and documents in accordance with generally accepted accounting principles and shall clearly identify and make such items readily accessible to such parties during the term of this Agreement and for a period of three (3) years from the date of final payment by City hereunder.

9. ENFORCEMENT OF AGREEMENT

9.1 California Law. This Agreement shall be construed and interpreted both as to validity and to performance of the parties in accordance with the laws of the State of California .

Legal actions concerning any dispute, claim, or matter arising out of or in relation to this Agreement shall be instituted in the Superior Court of the County of Riverside, State of California, or any other appropriate court in such county, and Contractor covenants and agrees to submit to the personal jurisdiction of such court in the event of such action.

9.2 Interpretation. This Agreement shall be construed as a whole according to its fair language and common meaning to achieve the objectives and purposes of the Parties . The terms of this Agreement are contractual and the result of negotiation between the Parties.

Accordingly, any rule of construction of contracts (including, without limitation, California Civil Code Section 1654) that ambiguities are to be construed against the drafting party, shall not be employed in the interpretation of this Agreement . The caption headings of the various sections and paragraphs of this Agreement are for convenience and identification purposes only and shall not be deemed to limit, expand, or define the contents of the respective sections or paragraphs.

9.3 Waiver. No delay or omission in the exercise of any right or remedy of a non- defaulting Party on any default shall impair such right or remedy or be construed as a waiver .

No consent or approval of City shall be deemed to waive or render unnecessary City’s consent to or approval of any subsequent act of Contractor . Any waiver by either Party of any default must be in writing. No such waiver shall be a waiver of any other default concerning the same or any other provision of this Agreement.

9.4 Rights and Remedies are Cumulative . Except with respect to rights and remedies expressly declared to be exclusive in this Agreement, the rights and remedies of the parties are cumulative. The exercise by either Party of one or more of such rights or remedies shall not preclude the exercise by it, at the same or different times, of any other rights or remedies for the same default or any other default by the other Party.

9.5 Legal Action. In addition to any other rights or remedies, either Party may take legal action, in law or in equity, to cure, correct, or remedy any default, to recover damages for any default, to compel specific performance of this Agreement, to obtain injunctive relief, a declaratory judgment, or any other remedy consistent with the purposes of this Agreement.

9.6 Attorney Fees. In the event any dispute between the Parties with respect to this Agreement results in litigation or any non- judicial proceeding, the prevailing Party shall be entitled, in addition to such other relief as may be granted, to recover from the non- prevailing Party all reasonable costs and expenses . These include but are not limited to reasonable Item 1H - Page 10

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attorney fees, expert contractor fees, court costs and all fees, costs, and expenses incurred in any appeal or in collection of any judgment entered in such proceeding.

10. CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION

10.1 Non-Liability of City Officers and Employees . No officer or employee of City shall be personally liable to the Contractor, or any successor -in-interest, in the event of any default or breach by City or for any amount which may become due to the Contractor or its successor, or for breach of any obligation of the terms of this Agreement.

10.2 Conflict of Interest. Contractor acknowledges that no officer or employee of the City has or shall have any direct or indirect financial interest in this Agreement, nor shall Contractor enter into any agreement of any kind with any such officer or employee during the term of this Agreement and for one (1) year thereafter . Contractor warrants that Contractor has not paid or given, and will not pay or give, any third party any money or other consideration in exchange for obtaining this Agreement.

10.3 Covenant Against Discrimination. In connection with its performance under this Agreement, Contractor shall not discriminate against any employee or applicant for employment because of actual or perceived race, religion, color, sex, age, marital status, ancestry, national origin ( i.e., place of origin, immigration status, cultural or linguistic characteristics, or ethnicity), sexual orientation, gender identity, gender expression, physical or mental disability, or medical condition (each a “prohibited basis”). Contractor shall ensure that applicants are employed, and that employees are treated during their employment, without regard to any prohibited basis. As a condition precedent to City’s lawful capacity to enter this Agreement, and in executing this Agreement, Contractor certifies that its actions and omissions hereunder shall not incorporate any discrimination arising from or related to any prohibited basis in any Contractor activity, including but not limited to the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship; and further, that Contractor is in full compliance with the provisions of Palm Springs Municipal Code Section

7.09.040, including without limitation the provision of benefits, relating to non- discrimination in city contracting.

11. MISCELLANEOUS PROVISIONS

11.1 Notice. Any notice, demand, request, consent, approval, or communication that either Party desires, or is required to give to the other Party or any other person shall be in writing and either served personally or sent by pre- paid, first-class mail to the address set forth below. Notice shall be deemed communicated seventy-two (72) hours from the time of mailing if mailed as provided in this Section. Either Party may change its address by notifying the other Party of the change of address in writing.

To City: City of Palm Springs
Attention: City Manager/ City Clerk
3200 E. Tahquitz Canyon Way
Palm Springs, California 92262
To Contractor: Onyx Paving Company, Inc.

Attention: Corey R. Kirschner
2890 E. La Cresta Ave.

Anaheim, CA 92806

11.2 Integrated Agreement . This Agreement constitutes the entire understanding between the Parties and supersedes and cancels all prior negotiations, arrangements, agreements, representations, and understandings, if any, made by or among the Parties with respect to the subject matter in this Agreement.

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11.3 Amendment. No amendments or other modifications of this Agreement shall be binding unless through written agreement signed by all Parties.

11.4 Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law . In the event that any one or more of the phrases, sentences, clauses, paragraphs, or sections contained in this Agreement shall be declared invalid or unenforceable by valid judgment or decree of a court of competent jurisdiction, such invalidity or unenforceability shall not affect any of the remaining phrases, sentences, clauses, paragraphs, or sections of this Agreement, which shall be interpreted to carry out the intent of the Parties.

11.5 Successors in Interest. This Agreement shall be binding upon and inure to the benefit of the Parties’ successors and assignees.

11.6 Third Party Beneficiary. Except as may be expressly provided for in this Agreement, nothing contained in this Agreement is intended to confer, nor shall this Agreement be construed as conferring, any rights, including, without limitation, any rights as a third- party beneficiary or otherwise, upon any entity or person not a party to this Agreement.

11.7 Recitals. The above -referenced Recitals are hereby incorporated into the Agreement as though fully set forth in this Agreement and each Party acknowledges and agrees that such Party is bound, for purposes of this Agreement, by the same.

11.8 Authority. The persons executing this Agreement on behalf of the Parties warrant that they are duly authorized to execute this Agreement on behalf of Parties and that by so executing this Agreement the Parties are formally bound to the provisions of this Agreement.

11.9 Counterparts. This Agreement may be signed in counterparts, each of which shall constitute an original.

11.10 Compliance with Economic Sanctions in Response to Russia's Actions in Ukraine. When funding for the services is provided, in whole or in part, by an agency controlled of the State of California, Consultant shall fully and adequately comply with California Executive Order N -6-22 (“Russian Sanctions Program”). As part of this compliance process, Consultant shall also certify compliance with the Russian Sanctions Program by completing the form located in Exhibit “C” (Russian Sanctions Certification), attached hereto and incorporated herein by reference. Consultant shall also require any subconsultants to comply with the Russian Sanctions Program and certify compliance pursuant to this Section.

[SIGNATURES ON NEXT PAGE]
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SIGNATURE PAGE TO CONTRACT SERVICES AGREEMENT
BY AND BETWEEN THE CITY OF PALM SPRINGS AND ONYX PAVING COMPANY, INC.

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the dates stated below.

CONTRACTOR:

By: _____________________________ By: _____________________________ Signature Signature
(2nd signature required for Corporation)

Date: ___________________________ Date: ___________________________

CITY OF PALM SPRINGS:

APPROVED BY CITY COUNCIL:

Date: ________________ Item No. ________________

APPROVED AS TO FORM: ATTEST:

By: _____________________________ By: _____________________________ City Attorney City Clerk

APPROVED:

By: _____________________________ Date: ____________________________ City Manager – over $50,000
Deputy/Assistant City Manager – up to $50,000
Director – up to $25,000
Manager – up to $5,000

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EXHIBIT “A”

SCOPE OF SERVICES/WORK

Including,

Schedule of Fees

And

Schedule of Performance

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1.1 Background:

The City requires the services of a contractor to provide on- call asphalt repair and replacement services in various locations throughout the City of Palm Springs.

1.2 Scope:

A. Contractor shall furnish all parts, materials, tools, equipment, labor, and supervision to perform asphalt repair and replacement services (Work) on an as- requested basis throughout various locations in the City of Palm Springs.

B. All work must conform to the City of Palm Springs Standard Drawings and Specifications and Standards for Public Works Construction (Latest Edition), or as directed by the City’s Project Manager.

C. The repair and replacement work includes but is not limited to the following:
a. Streets
b. Sidewalks
c. Gutters
D. Traffic control shall be used at all locations and in conformance with City of Palm Springs Standards, WATCH Manual (Latest Edition), and State and Federal Regulations.

E. Contractor must give 48 -hour advance notice to the City’s Project Manager, prior to the start of pavement repair work.

F. All asphalt pavement repairs shall be completed within ten (10) working days after the Contractor receives written approval from the City’s Project Manager.

G. Required Process for Asphalt Pavement Repair/Replacement:
a. Saw cut a clean, straight, vertical edge approximately 12” beyond the edge of the repair section. All liquids generated by the saw cutting shall be vacuumed and legally disposed of in compliance with the Federal Clean Water Act (NPDES).

Saw cutting must be completed in advance of pavement repair, allowing moisture to evaporate before applying SS 1- H to edges. This task may be performed by City staff, contractor shall verify prior to beginning asphalt replacement. b. Remove and Dispose of the repair section to a depth of 1” greater than the existing pavement, but no less than 4”.
c. Compact sub-grade to a minimum of 95% relative compaction. d. Apply an even hot tack coat to dry and cleaned vertical edges. e. Apply base course using ¾” PG 64-10 hot mix asphalt and compact to maximum density. Base course and cap before moving to next patch. f. Apply seal coat to finish edges of finished pavement. g. Apply #30 silica-sand to edges of finished pavement. h. The finish surface shall exhibit a smooth, uniform appearance, free of voids and segregation.
i. Traffic control is to remain in place until the new pavement is allowed to cool to a point that it can sustain motor vehicles without scuffing or rutting. j. All finished repairs shall be within .125” of existing asphalt surfaces.

1.3 Bonding:

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A. For any Task Order authorized by City of over Twenty Five Thousand Dollars and 00/100 ($25,000.00), Contractor shall obtain, provide and maintain at its own expense during the term of this Agreement: (1) a Payment Bond in the amount of one hundred percent (100%) of the total amount to be paid Contractor as set forth in any Task Order authorized by City of over Twenty Five Thousand Dollars and 00/100 ($25,000.00), and in the form attached hereto as Exhibit D which is incorporated herein by this reference; and (2) a Performance Bond in the amount of one hundred percent (100%) of the total amount to be paid Contractor as set forth in any Task Order authorized by City of over Twenty Five Thousand Dollars and 00/100 ($25,000.00), and in the form attached hereto as Exhibit E which is incorporated herein by this reference.

B. The Payment Bond and Performance Bond shall be issued by an insurance organization or surety (1) currently authorized by the Insurance Commissioner to transact business of insurance in the State of California, (2) listed as an acceptable surety in the latest revision of the Federal Register Circular 570, and (3) assigned a Policyholders' Rating A (or higher) and Financial Size Category Class VII (or larger) in accordance with the latest edition of Best's Key Rating Guide: Property-Casualty.

C. Contractor shall deliver, concurrently with City’s approval of any Task Order over Twenty Five Thousand Dollars and 00/100 ($25,000.00), the Payment Bond and Performance Bond, a certified copy of the “Certificate of Authority” of the Insurer or Surety issued by the Insurance Commissioner, which authorizes the Insurer or Surety to transact surety insurance in the State of California.

1.4 Pricing:

1. The pricing included in this Contract shall be firm for the first year.

2. The unit prices may be adjusted (decreased or increased) once a year to correspond with the most recent annual change to the Consumer Price Index for All Urban Consumers as published by the U.S. Bureaus of Labor Statistics for the Riverside- San Bernardino-Ontario Areas.

3. Project work will be authorized on a Task Order basis. The City will request a scope of work and the Contractor will provide a proposal/quote that corresponds to the pricing detailed in the bid form. The City will authorize the work via a signed Task Order form and corresponding release purchase order.

4. The City will only pay for the items listed on the bid form, and permit and disposal fees. This does not include access to public utilities. Contractor must incorporate all of its costs in its unit bid prices, including but not limited to labor, supervision, project management, overhead, profit, onboarding training, travel, mileage, truck charges, fuel charges, service call charges, parking, delivery, portal -to-portal charges, environmental fees, shop supplies and consumable incidental materials. The City will not pay for subcontractors, rental of equipment/tools, and purchase of materials/supplies unless the City authorized payment of the applicable items.

1.5 Payment:

The resulting contract for these services is an on- call as needed contract. No specific amount of work is guaranteed. The contract value is an estimated value only. All work authorized under the contract will be compensated on a time and material basis as outlined in the Invoicing Section.

1.6 Invoicing:

Contractor will submit an itemized invoice monthly. Billings must reference a purchase order number and shall indicate the unit (contract) price. Contractor will be paid for the Item 1H - Page 16

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actual hours worked at the rates shown in the contract. Parts, materials, equipment, and subcontractor costs will be compensated at actual cost with receipts required with allowable markup as outline in the contract. Contractor shall break out the line items on the invoice in accordance with the line items on the bid form. Contractor must provide back-up documentation for materials, subcontractor, rented equipment, permits, disposal and recycling fees. Invoices that are submitted with incorrect prices may be returned for correction before any payments to the contractor are authorized. It shall be the contractor’s responsibility to submit a correct invoice. The City shall not be responsible for payment until a correct invoice is received. The invoice shall be accompanied by receipts, dated, and signed by a City Employee, verifying the work was done. Invoices and receipts will be submitted to the Contract Officer for approval. All invoices are to be sent as one document, per month to: [email protected] .

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ATTACHMENT G

BIO FORM
INVITATION FOR BIOS (IFB 24·03)
ON•CALL ASPHA LT REPAIR ANO REPLACEMENT SERVICES
Responding to this IFB for on-call asphalt repair and replacement services, the undersigned bidder proposes and agrees to provide the services and work in accordance with the ,specifications. Bidder proposes and agrees to furnish all labor. equipment, materials, supervision. and service necessary to complete said Work in accordance with the Specilications of the City of Palm Springs and will accept as full payment therefore, the following unit cost amounts. The City of Palm Springs will not accept any additional charges, fees, e,tc. that are not already included or incorporated in the below unit costs .

ITEM DESCRIPTION UNIT ESTIMATED UNIT PRICE SUBTOTAL QUANTITY 1 Remove and replace/repair 4" SF 24,000 t,., ~<f<,rt:t> thick 2 Remove and replace/repair 6" SF 12,000 1-bl,OOo thick '.2\.f'S' 3 Each additional 2" of aspha lt SF 3.000 bevond 6' '1 '.21,(X)O 4 Construct ion of P.C.C. 6" Curb LF 300 7? ,000 and 12" Gutter ".2.1.10 5 Construction of P.C.C. 8" Curb LF 300 '.?'SD and 24" Gutter 1~ ,cP:> 6 Saw Cutting (if required) up to 6" LF 300 -Z,OOD thick lD 7 Crushed Aggrega te Base (if CY
reauired\ 300 I Ot) '2>D,ooo
8 Traffic Control - Lane CIQ~Yre each 30 qOD ;;t".t-1COO TOTAL (Enter this amount i n Pla netBlds) r1't,ooo
• NOTE: This bid form Is to deterrmne the lowest bidder and vAIJ be used to establish the contract unij prices. The contract will be set at the City budget amount.

Firm Name: O NYX PAVING COMPA NY INC.

DIR Number: 1000004798
Signature of Authorized Person: _ /.µ._· ______ _____ _ _ Printed Name: COREY R. KIRSCHNER
Title: CEO PBl:S YP SEC JRfA
Date: 4/8/2024

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EXHIBIT “B”

INSURANCE PROVISIONS

Including

Verification of Coverage,

Sufficiency of Insurers,

Errors and Omissions Coverage,

Minimum Scope of Insurance,

Deductibles and Self-Insured Retentions, and

Severability of Interests (Separation of Insureds)
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INSURANCE

1. Procurement and Maintenance of Insurance. Contractor shall procure and maintain public liability and property damage insurance against all claims for injuries against persons or damages to property resulting from Contractor’s performance under this Agreement .

Contractor shall procure and maintain all insurance at its sole cost and expense, in a form and content satisfactory to the City, and submit concurrently with its execution of this Agreement .

Contractor shall also carry workers’ compensation insurance in accordance with California workers’ compensation laws . Such insurance shall be kept in full force and effect during the term of this Agreement, including any extensions . Such insurance shall not be cancelable without thirty (30) days advance written notice to City of any proposed cancellation. Certificates of insurance evidencing the foregoing and designating the City, its elected officials, officers, employees, agents, and volunteers as additional named insureds by original endorsement shall be delivered to and approved by City prior to commencement of services. The procuring of such insurance and the delivery of policies, certificates, and endorsements evidencing the same shall not be construed as a limitation of Contractor’s obligation to indemnify City, its elected officials, officers, agents, employees, and volunteers.

2. Minimum Scope of Insurance. The minimum amount of insurance required under this Agreement shall be as follows:

1. Comprehensive general liability and personal injury with limits of at least one million dollars ($1,000,000.00) combined single limit coverage per occurrence and two million dollars ($2,000,000) general aggregate;

2. Automobile liability insurance with limits of at least one million dollars ($1,000,000.00) per occurrence;

3. Professional liability (errors and omissions) insurance with limits of at least one million dollars ($1,000,000.00) per occurrence and two million dollars ($2,000,000) annual aggregate is:
_________ required
___x_____ is not required;

4. Workers’ Compensation insurance in the statutory amount as required by the State of California and Employer’s Liability Insurance with limits of at least one million dollars $1 million per occurrence. If Contractor has no employees, Contractor shall complete the City’s Invitation for Waiver of Workers’ Compensation Insurance Requirement form.

3. Primary Insurance. For any claims related to this Agreement, Contractor’s insurance coverage shall be primary with respect to the City and its respective elected officials, officers, employees, agents, and volunteers. Any insurance or self-insurance maintained by City and its respective elected officials, officers, employees, agents, and volunteers shall be in excess of Contractor’s insurance and shall not contribute with it . For Workers’ Compensation and Employer’s Liability Insurance only, the insurer shall waive all rights of subrogation and contribution it may have against City, its elected officials, officers, employees, agents, and volunteers.

4. Errors and Omissions Coverage. If Errors & Omissions Insurance is required, and if Contractor provides claims made professional liability insurance, Contractor shall also agree in writing either (1) to purchase tail insurance in the amount required by this Agreement to cover claims made within three years of the completion of Contractor’s services under this Agreement, or (2) to maintain professional liability insurance coverage with the same carrier in the amount required by this Agreement for at least three years after completion of Contractor’s services under this Agreement. Contractor shall also be required to provide evidence to City of the purchase of the required tail insurance or continuation of the professional liability policy.

Item 1H - Page 20

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5. Sufficiency of Insurers. Insurance required in this Agreement shall be provided by authorized insurers in good standing with the State of California. Coverage shall be provided by insurers admitted in the State of California with an A.M. Best’s Key Rating of B++, Class VII, or better, unless otherwise acceptable to the City.

6. Verification of Coverage. Contractor shall furnish City with both certificates of insurance and endorsements, including additional insured endorsements, effecting all of the coverages required by this Agreement. The certificates and endorsements are to be signed by a person authorized by that insurer to bind coverage on its behalf . All proof of insurance is to be received and approved by the City before work commences . City reserves the right to require Contractor’s insurers to provide complete, certified copies of all required insurance policies at any time . Additional insured endorsements are not required for Errors and Omissions and Workers’ Compensation policies.

Verification of Insurance coverage may be provided by: (1) an approved General and/or Auto Liability Endorsement Form for the City of Palm Springs or (2) an acceptable Certificate of Liability Insurance Coverage with an approved Additional Insured Endorsement with the following endorsements stated on the certificate:

A. "The City of Palm Springs, its officials, employees, and agents are named as an additional insured…” ("as respects City of Palm Springs Contract No.___" or "for any and all work performed with the City" may be included in this statement).

B. "This insurance is primary and non -contributory over any insurance or self - insurance the City may have..." ("as respects City of Palm Springs Contract No.___" or "for any and all work performed with the City" may be included in this statement).

C. "Should any of the above described policies be canceled before the expiration date thereof, the issuing company will mail 30 days written notice to the Certificate Holder named." Language such as, “endeavor to” mail and "but failure to mail such notice shall impose no obligation or liability of any kind upon the company, its agents or representative" is not acceptable and must be crossed out.

D. Both the Workers’ Compensation and Employers' Liability policies shall contain the insurer's waiver of subrogation in favor of City, its elected officials, officers, employees, agents, and volunteers.

In addition to the endorsements listed above, the City of Palm Springs shall be named the certificate holder on the policies.

All certificates of insurance and endorsements are to be received and approved by the City before work commences . All certificates of insurance must be authorized by a person with authority to bind coverage, whether that is the authorized agent/broker or insurance underwriter.

Failure to obtain the required documents prior to the commencement of work shall not waive the Contractor’s obligation to provide them.

7. Deductibles and Self -Insured Retentions . Any deductibles or self -insured retentions must be declared to and approved by the City prior to commencing any work or services under this Agreement . At the option of the City, either (1) the insurer shall reduce or eliminate such deductibles or self-insured retentions with respect to the City, its elected officials, officers, employees, agents, and volunteers; or (2) Contractor shall procure a bond guaranteeing payment of losses and related investigations, claim administration, and defense expenses. Certificates of Insurance must include evidence of the amount of any deductible or self-insured retention under the policy . Contractor guarantees payment of all deductibles and self-insured retentions.

Item 1H - Page 21

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8. Severability of Interests (Separation of Insureds) . This insurance applies separately to each insured against whom claim is made or suit is brought except with respect to the limits of the insurer’s liability.

Item 1H - Page 22

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EXHIBIT “C”

Item 1H - Page 23
ATTACHM ENT "F"
EXECUTIVE ORDER N-6-22 CERTIFICATION
INVITATION FOR BIDS (IFB 24-03)

ON-CALL ASPHALT REPAIR AND REPLACEMENT SERVICES
Executive Order N-6-22 Issued by Governor Gavin Newsom on March 4, 2022, directs all agencies and departments that are subject to the Governor's authority to (a) terminate any contracts with any individuals or entities that are determined to be a target of economic sanctions against Russia and Russian entijies and individuals; and (b) refrain from entering into any new contracts with such individuals or entities while the aforementioned sanctions are in effect.

Executive Order N-6-22 also requires that any contractor that: (1) currently has a contract with the C ity of Palm Springs funded through grant funds p rovided by the State of Callfornra; anaror (2) submits a 010 or proposal or ornerwise proposes 10 or enter Into or renew a contract with the City of Palm Springs with State of California grant funds, oertify that the person is not the target of any economic sanctions against Russia and Russian entnies and individuals.

The contractor hereby certifies, SUBJECT TO PENALTY FOR PERJURY, that a) the contractor Is not a target of any economic sanctions against Russian and Russian entities and individuals as discussed in Executive Order N-6-22 and b) the person sgning below is duly authorized lo legally bind the Contractor. This oertification is made under the laws of the State of California.

Signature:,.F'------------ --r
Printed Name: COREY R. KIRSCHNER
Title: CEO PRES VP SEc:-T REA-. -
Firm Name: ONYX PAVING COMPANY INC
Date: 4/8/2024

Page 20 of 27 ends

EXHIBIT “D”
PAYMENT BOND – PUBLIC WORKS

KNOW ALL MEN BY THESE PRESENTS,

WHEREAS, the City of Palm Springs, a charter city, organized and existing in the County of Riverside, California, as Obligee, (hereinafter referred to as the “City”), has awarded to the undersigned Contractor, (hereinafter referred to as the “Contractor”), an agreement for the work described as follows:

PROJECT NAME
CITY CONTRACT NO. 24B082

(hereinafter referred to as the “Public Work”); and
WHEREAS, the work to be performed by the Contractor is more particularly set forth in that certain Agreement (Construction Contract) for the said Public Work awarded to the Contractor and approved by the City for the Project hereinabove named, (hereinafter referred to as the “Contract”), which Contract is incorporated herein by this reference; and WHEREAS, said Contractor is required to furnish a bond in connection with said Contract and pursuant to Section 9550 of the California Civil Code.

NOW, THEREFORE, we, the undersigned Contractor, as Principal, and:
, a
corporation organized and existing under the laws of the State of ____________, and duly authorized to transact business under the laws of the State of California, as Surety, are held and firmly bound unto the City, and to any and all persons, companies, or corporations entitled to file stop payment notices under Section 9100 of the California Civil Code, in the sum of ________________________________________________________ Dollars ($_________________), said sum being not less than 100 percent of the total amount payable by the City under the terms to the said Contract, for which amount well and truly to be made, we bind ourselves, our heirs, executors, administrators, successors, and assigns, jointly and severally, firmly by these presents.

THE CONDITION OF THIS OBLIGATION IS SUCH , that, if said Contractor, his or its heirs, executors, administrators, successors, or assigns, or Subcontractors, shall fail to pay for any materials, provisions or other supplies, implements, machinery, or power used in, upon, for, or about the performance of the Public Work contracted to be done, or to pay any person for any work or labor of any kind, or for bestowing skills or other necessary services thereon, or for amounts due under the Unemployment Insurance Code with respect to such work or labor, or for any amounts required to be deducted, withheld, and paid over to the Employment Development Department from the wages of employees of paid Contractor and his Subcontractors pursuant to Section 13020 of the Unemployment Insurance Code with respect to such work and labor as required by the provisions of Sections 9550 through 9560 of the Civil Code, the Surety or Sureties hereon will pay for the same in an amount not exceeding the sum specified in this bond, otherwise the above obligation shall be void. In addition to the provisions herein above, it is agreed that this bond will inure to the benefit of any and all persons, companies, and corporations entitled to serve stop payment notices under Section 9100 of the Civil Code, so as to give a right of action to them or their assigns in any suit brought upon this bond.

Item 1H - Page 24

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PAYMENT BOND – PUBLIC WORKS
(CONTINUED)

The Surety, for value received, hereby stipulates and agrees that no change, extension of time, alteration, or additions to the terms of the said Contract or to the work to be performed thereunder or the Specifications accompanying the same shall in any way affect its obligations on this bond, and it does hereby waive notice of any such change, extension of time, alteration, or addition to the terms of the Contract or to the work or to the Specifications.

No final settlement between the City and the Contractor hereunder shall abridge the right of any beneficiary hereunder, whose claim may be unsatisfied.

Contractor and Surety, an admitted surety insurer, further agree that if the City or any entity or person entitled to file stop payment notices is required to engage the services of an attorney in connection with the enforcement of this bond, each shall be liable for the reasonable attorney's fees incurred, with or without suit, in addition to the above sum.

SIGNED AND SEALED, this ____ day of __________________, 20____.

CONTRACTOR:

Check one: ____ individual, ___ partnership, ___ corporation

(This Payment Bond must be signed by representatives and/or officers having appropriate authority to bind the Contractor and Surety to the terms of the Payment Bond.)

EXECUTED FOR THE CONTRACTOR: EXECUTED FOR THE SURETY:

By: By:

signature signature
(NOTARIZED) (NOTARIZED)

Print Name and Title: Print Name and Title:

signature
(NOTARIZED)

Print Name and Title:

Item 1H - Page 25

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PAYMENT BOND – PUBLIC WORKS
(CONTINUED)

The rate of premium on this bond is $________ per thousand.

The total amount of premium charged: $__________

(The above must be filled in by corporate surety).

IMPORTANT: Surety companies executing bonds must possess a certificate of authority from the California Insurance Commissioner authorizing them to write surety insurance defined in Section 105 of the California Insurance Code, and if the work or project is financed, in whole or in part, with Federal, grant, or loan funds, it must also appear on the Treasury Department’s most current list (Circular 570 as amended). THIS IS A REQUIRED FORM.

Any claims under this bond may be addressed to:

(Name and Address of Surety)

(Name and Address of Agent or
Representative for service of
process in California if
different from above)

(Telephone Number of Surety and
Agent or Representative for
service of process in California)

Item 1H - Page 26

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PAYMENT BOND – PUBLIC WORKS
(CONTINUED)

ALL-PURPOSE ACKNOWLEDGMENT

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

County of

On __ _ before me, , Date Name, Title of Officer personally appeared ,

NAME(S) OF SIGNER(S)

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 signatures(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 identified herein, that the foregoing paragraph is true and correct.

Witness my hand and official seal.

__________________________________
Signature of Notary

ATTENTION NOTARY: Although the information requested below is OPTIONAL, it could prevent fraudulent attachment of this certificate to unauthorized document.

THIS CERTIFICATE Title or Type of Document

MUST BE ATTACHED
TO THE DOCUMENT Number of Pages DATE of DOCUMENT DESCRIBED AT RIGHT:

Signer(s) Other Than Named Above_____________________________________________________

Item 1H - Page 27

Page 24 of 27 ends

EXHIBIT “E”
PERFORMANCE BOND – PUBLIC WORKS

KNOW ALL MEN BY THESE PRESENTS,

PROJECT NAME
CITY CONTRACT NO. 24B082

(hereinafter referred to as the “Public Work”); and

WHEREAS, the work to be performed by the Contractor is more particularly set forth in that certain Agreement (Construction Contract) for the said Public Work awarded to the Contractor and approved by the City for the Project hereinabove named, (hereinafter referred to as the "Contract"), which Contract is incorporated herein by this reference; and

WHEREAS, the Contractor is required by said Contract to perform the terms thereof, and to provide a bond both for the performance and guaranty thereof.

NOW, THEREFORE, we, the undersigned Contractor, as Principal, and:
,
a corporation organized and existing under the laws of the State of ____________, and duly authorized to transact business under the laws of the State of California, as Surety, are held and firmly bound unto the City in the sum of ______________________________________________ Dollars ($_________________), said sum being not less than 100 percent of the total amount payable by the City under the terms to the said Contract, for which amount well and truly to be made, we bind ourselves, our heirs, executors, administrators, successors, and assigns, jointly and severally, firmly by these presents.

THE CONDITION OF THIS OBLIGATION IS SUCH, that if the bounden Contractor, his or its heirs, executors, administrators, successors, or assigns, shall in all things stand to and abide by, and well and truly keep and perform the covenants, conditions and agreements in the said Contract and any alteration thereof made as therein provided, on his or its parts, to be kept and performed at the time and in the manner therein specified, and in all respects according to their intent and meaning; and shall faithfully fulfill the one year guarantee of all materials and workmanship; and indemnify and save harmless the City, its officers and agents, as stipulated in said Contract, then this obligation shall become null and void; otherwise it shall be and remain in full force and effect.

The said Surety, for value received, hereby stipulates and agrees that no change, extension of time, alteration, or addition to the terms of the Contract or to the work to be performed thereunder or the Specifications accompanying the same shall in any way affect its obligations on this bond, and it does hereby waive notice of any such change, extension of time, alteration of addition to the terms of the Contract, or to the Public Work or to the Specifications.

No final settlement between the City and the Contractor shall abridge the right of any beneficiary hereunder, whose claim may be unsatisfied.

Item 1H - Page 28

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PERFORMANCE BOND – PUBLIC WORKS
(CONTINUED)

Contractor and Surety agree that if the City is required to engage the services of an attorney in connection with enforcement of the bond, each shall pay City's reasonable attorney's fees incurred, with or without suit, in addition to the above sum.

SIGNED AND SEALED, this ____ day of ___________________, 20____.

CONTRACTOR:

Check one: ____ individual, ___ partnership, ___ corporation

(This Performance Bond must be signed by representatives and/or officers having appropriate authority to bind the Contractor and Surety to the terms of the Performance Bond.)

CONTRACTOR: SURETY:

By: By

signature signature
(NOTARIZED) (NOTARIZED)

Print Name and Title: Print Name and Title:

By:

signature
(NOTARIZED)

Print Name and Title:

By submitting this Performance Bond, the Contractor and Surety acknowledge the provisions of the Contract Documents with regard to Section 6-4 “Default by the Contractor”, as further amended by the Special Provisions.

Item 1H - Page 29

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PERFORMANCE BOND – PUBLIC WORKS
(CONTINUED)

The rate of premium on this bond is $________ per thousand.

The total amount of premium charged: $__________

(The above must be filled in by corporate surety).

Any claims under this bond may be addressed to:

(Name and Address of Surety)

(Name and Address of Agent or
Representative for service of
process in California if
different from above)

(Telephone Number of Surety and
Agent or Representative for
service of process in California)

Item 1H - Page 30

Page 27 of 27 ends

PERFORMANCE BOND – PUBLIC WORKS
(CONTINUED)

ALL-PURPOSE ACKNOWLEDGMENT

State of

County of

On __ _ before me,
Date Name, Title of Officer personally appeared ,

NAME(S) OF SIGNER(S)

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

Witness my hand and official seal.

__________________________________
Signature of Notary
ATTENTION NOTARY: Although the information requested below is OPTIONAL, it could prevent fraudulent attachment of this certificate to unauthorized document.

THIS CERTIFICATE Title or Type of Document

MUST BE ATTACHED
TO THE DOCUMENT Number of Pages DATE of DOCUMENT DESCRIBED AT RIGHT:

Signer(s) Other Than Named Above

Item 1H - Page 31

ATTACHMENT B

Item 1H - Page 32
Item 1H - Page 33

1. Name of Entity

PUBLIC INTEGRITY DISCLOSURE

APPLICANT DISCLOSURE FORM
ONYX PAVING COMPANY, INC.

2. Address of Entity (Principal Place of Business)
2890 E. LA CRESTA AVE. ANAHEIM, CA 92806

3. Local or California Address (if different than #2)
2890 E. LA CRESTA AVE . ANAHEIM , CA 92806

4. State where Entity is Registered with Secretary of State

CALIFORNIA
If other than California, is the Entity also registered in California? D Yes D No

5. Type of Entity
0 Corporation D Limited Liability Company D Partnership D Trust D Other (please specify)

6. Officers, Directors, Members, Managers, Trustees, Other Fiduciaries (please specify) Note: If any response is not a natural person, please identify all officers, directors, members, managers and other fiduciaries for the member, manager, trust, or other entity
COREY R. KIRSCHNER -
__ C_E_O~, P_R_E_S~1_V_P~, S_E_C~, T_R_E_A_. __ 0 Officer O Director O Member O Manager [name) D General Partner D Limited Partner
Other _________ _ _
----- --=========------======-- D Officer D Director D Member D Manager [name) D General Partner D Limited Partner
D Other __________ _
_______ _______ D Officer D Director D Member D Manager [name] D General Partner D Limited Partn er
D Other _____ ____ _ _
Item 1H - Page 34

7. Owners/Investors with a 5% beneficial interest in the Applicant Entity or a related entity

EXAMPLE
JANE DOE 50%, ABC COMPANY, Inc.
[name of owner/investor] [percentage of beneficial interest in entity and name of entity]
A.

COBEY: B. ~IBSCtH~EB 100%, ONYX PAVING COMPANY , INC
[name of owner/investor] [percentage of beneficial interest in entity and name of entity]
B.
[name of owner/investor] [percentage of beneficial interest in entity and name of entity]
C.
[name of owner/investor] [percentage of beneficial interest in entity and name of entity]
D.
[name of owner/investor] [percentage of beneficial interest in entity and name of entity]
E.
[name of owner/investor] [percentage of beneficial interest in entity and name of entity]

I DECLARE UNDER PENALTY OF PERJURY UNDER THE LAWS OF THE STATE OF -- CALIFORNIA THAT THE FOREGOING IS TRUE AND CORRECT.

Signature of Disclosing Party, Printed Name, Title Date ~
4/8/2024
COREY R. KIRSCHNER -
CEO, PRES.VP, SEC, TREA.

CITY COUNCIL STAFF REPORT

DATE: MAY 9, 2024 CONSENT CALENDAR

SUBJECT: APPROVE CONTRACT SERVICES AGREEMENT NO. 2 4B083 WITH HARDY & HARPER, INC. FOR ON -CALL CONCRETE REPAIR AND

REPLACEMENT SERVICES

FROM: Scott C. Stiles, City Manager

BY: David McAbee, Director of Public Works

SUMMARY:

This action will approve Agreement No. 24B083 with Hardy & Harper, Inc., in an amount not to exceed $1,500,000, for on-call concrete repair and replacement services.

RECOMMENDATION:

1. Approve Contract Services Agreement 24B0 83 ( Attachment A ) with Hardy & Harper, Inc. to provide on -call concrete repair and replacement services in an amount not to exceed $1,500,000 for the initial three-year term beginning May 13, 2024, through May 12, 2027, with two one-year extension options at the City’s sole discretion; and

2. Authorize the City Manager or designee to execute all necessary documents.

BUSINESS PRINCIPAL DISCLOSURE:

According to the Public Integrity Disclosure form ( Attachment B) submitted on April 11, 2024, Hardy & Harper, Inc. is registered in the state of California.

BACKGROUND:

The City requires the services of a contractor to provide on- call repair and replacement of sidewalks, curbs, ramps, and other related concrete work. The projects may include street improvements, curbs, various gutter work, spandrel, sidewalks, ADA Ramps, and other projects that require concrete flatwork based on square feet in various thickness with or without wire mesh.

Item 1I - Page 1
City Council Staff Report
May 9, 2024 -- Page 2
Award On-Call Citywide Concrete Repair and Replacement Services Contract

During the Fiscal Year 2023- 24 and 2024- 25 budget process, Public Works requested and was approved an increased budget to retain on-call concrete services to provide for the implementation of routine refreshing of City owned streets and parking lots.

STAFF ANALYSIS:

The contract with Hardy & Harper, Inc. is an on- call, as-needed type contract. The bids were used to determine the lowest, responsive, responsible bidder and to set the unit rates for the contract; however, the actual amount of the contract is based on the budgeted amount set by the Department and will therefore not match the bid amounts.

An Invitation for Bids (IFB 24-04) was initiated by the City’s Procurement and Contracting Department on March 18, 2024, based on the Department of Public Works specifications.

Vendor Bid
Hardy & Harper, Inc. – Lake Forest, CA $2,384,780.00
Granite Construction Company – Indio, CA $3,062,700.00
Tri-Star Contracting II, Inc. – Desert Hot Springs, CA $3,551,337.00

The unit pricing is fixed for the first year and subject to a CPI increase in the following years. Staff recommends approval of Contract Services Agreement No. 24B083 with Hardy & Harper, Inc. for the initial three-year term in the amount not to exceed $1,500,000 effective May 13, 2024, through May 12, 2027, subject to two one-year optional renewals at the sole discretion of the City.

ENVIRONMENTAL ASSESSMENT
:

ALIGNMENT WITH STRATEGIC PLANNING:

Approval of this action supports City Council priority 2, Community Infrastructure.

Item 1I - Page 2
City Council Staff Report
May 9, 2024 -- Page 3
Award On-Call Citywide Concrete Repair and Replacement Services Contract

FISCAL IMPACT:

Sufficient funds are budgeted and available in the Fiscal Year 2023- 24 and 2024- 25, Measure A 1343085-80000 and 1006515-40105.

REVIEWED BY:

ATTACHMENTS:

A. Contract Service Agreement No. 24B083
B. Public Integrity Disclosure Form

Item 1I - Page 3

ATTACHMENT A

Item 1I - Page 4

Page 1 of 27 ends

CONTRACT SERVICES AGREEMENT 24B083

ON-CALL CONCRETE REPAIR AND REPLACMENT SERVICES

City and Contractor are individually referred to as “Party” and are collectively referred to as the “Parties”.

RECITALS
A. City requires the services of a licensed and qualified firm to provide on- call concrete repair and replacement services, (“Project”).

B. Contractor has submitted to City a Bid to provide on-call asphalt repair and replacement services, under the terms of this Agreement.

C. Based on its experience, education, training, and reputation, Contractor is qualified and desires to provide the necessary services to City for the Project.

D. City desires to retain the services of Contractor for the Project.

AGREEMENT

1. CONTRACTOR SERVICES

2. TIME FOR COMPLETION
Item 1I - Page 5

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The tim
e for completion of the Services to be performed by Contractor is an essential condition of this Agreement . Contractor shall prosecute regularly and diligently the work of this Agreement according to the agreed upon schedule of performance set forth in Exhibit “A.” Neither Party shall be accountable for delays in performance caused by any condition beyond the reasonable control and without the fault or negligence of the non -performing Party. Delays shall not entitle Contractor to any additional compensation regardless of the Party responsible for the delay.

3. COMPENSATION OF CONTRACTOR

3. 1 Compensation of Contractor . Contractor shall be compensated and reimbursed for the services rendered under this Agreement in accordance with the schedule of fees set forth in Exhibit “A”. The total amount of Compensation shall not exceed $1,500,000.00.

A. To provide for revisions or modifications to documents, work product, or Work, when required by the enactment or
revision of any subsequent law ; or
B. To provide for addi tional services not included in this A greement or not customarily furnished in accordance with generally accepted practice in Contractor’s profession.

3.4 Appropriations . This Agreement is subject to, and contingent upon, funds being appropriated by the City Council of City for each fiscal year . If such appropriations are not made, this Agreement shall automatically terminate without penalty to City.

4. PERFORMANCE SCHEDULE

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

Page 3 of 27 ends

4.4 Term. Unless earlier terminated in accordance with Section 4.5 of this Agreement, this Agreement shall continue in full force and effect for a period of three years , commencing on May 13, 2024, and ending on May 12, 2027, unless extended by mutual written agreement of the Parties. In addition, the term may be extended at the sole discretion of the City upon written notice to the Contractor, for two (2) additional one (1) year terms.

Contractor shall be entitled to compensation for all Services rendered prior to receipt of the notice of termination and for any Services authorized by the Contract Officer after such notice .

5. COORDINATION OF WORK

It is expressly understood that the experience, knowledge, education, capability, and reputation of the foregoing principal is a substantial inducement for City to enter into this Agreement .

Therefore, the foregoing principal shall be responsible during the term of this Agreement for directing all activities of Contractor and devoting sufficient time to personally supervise the Services under this Agreement . The foregoing principal may not be changed by Contractor without prior written approval of the Contract Officer.

Page 4 of 27 ends

subcontractor(s) in the same manner as it is for persons directly employed. Nothing contained in this Agreement shall create any contractual relationships between any subcontractor and City.

Name: Title:
(to be determined)

5.6 California Labor Code Requirements.

6. INSURANCE
Item 1I - Page 8

Page 5 of 27 ends

Contractor shall procure and maintain, at its sole cost and expense, policies of insurance as set forth in the attached Exhibit "B", incorporated herein by reference.

7. INDEMNIFICATION.

8. RECORDS AND REPORTS

Item 1I - Page 9

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9. ENFORCEMENT OF AGREEMENT

9.1 California Law. This Agreement shall be construed and interpreted both as to validity and to performance of the parties in accordance with the laws of the State of California .

9.3 Waiver. No delay or omission in the exercise of any right or remedy of a non- defaulting Party on any default shall impair such right or remedy or be construed as a waiver .

Page 7 of 27 ends

attorney fees, expert contractor fees, court costs and all fees, costs, and expenses incurred in any appeal or in collection of any judgment entered in such proceeding.

10. CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION

7.09.040, including without limitation the provision of benefits, relating to non- discrimination in city contracting.

11. MISCELLANEOUS PROVISIONS

To City: City of Palm Springs
Attention: City Manager/ City Clerk
3200 E. Tahquitz Canyon Way
Palm Springs, California 92262
To Contractor: Hardy & Harper, Inc.

Attention: Mike Amundson
32 Rancho Circle
Lake Forest, CA 92630

Item 1I - Page 11

Page 8 of 27 ends

11.3 Amendment. No amendments or other modifications of this Agreement shall be binding unless through written agreement signed by all Parties.

11.5 Successors in Interest. This Agreement shall be binding upon and inure to the benefit of the Parties’ successors and assignees.

11.9 Counterparts. This Agreement may be signed in counterparts, each of which shall constitute an original.

[SIGNATURES ON NEXT PAGE]
Item 1I - Page 12

Page 9 of 27 ends

SIGNATURE PAGE TO CONTRACT SERVICES AGREEMENT
BY AND BETWEEN THE CITY OF PALM SPRINGS AND HARDY & HARPER, INC.

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the dates stated below.

CONTRACTOR:

By: _____________________________ By: _____________________________ Signature Signature
(2nd signature required for Corporation)

Date: ___________________________ Date: ___________________________

CITY OF PALM SPRINGS:

APPROVED BY CITY COUNCIL:

Date: ________________ Item No. ________________

APPROVED AS TO FORM: ATTEST:

By: _____________________________ By: _____________________________ City Attorney City Clerk

APPROVED:

By: _____________________________ Date: ____________________________ City Manager – over $50,000
Deputy/Assistant City Manager – up to $50,000
Director – up to $25,000
Manager – up to $5,000

Item 1I - Page 13

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EXHIBIT “A”

SCOPE OF SERVICES/WORK

Including,

Schedule of Fees

And

Schedule of Performance

Item 1I - Page 14

Page 11 of 27 ends

1.1 Background:

The City of Palm Springs requires the services of a contractor to provide on- call repair and replacement of sidewalks, curbs, ramps, and other related concrete work. The projects may include street improvements, A -6/A-8 curbs, various gutter work, spandrel, D curbing, sidewalks, ADA Ramps, and other projects that require concrete flatwork base on square feet in either 3”,4”, 6”, or 8” thickness with or without wire mesh.

1.2 Scope:

A. Contractor shall furnish all parts, materials, tools, equipment, labor, and supervision to perform concrete repair and replacement services (Work) on an as -requested basis throughout various locations in the City of Palm Springs.

B. All work must conform to the City of Palm Springs Standard Drawings and Specifications and Standards for Public Works Construction (Latest Edition), or as directed by the City’s Project Manager.

C. The scope of work includes but is not limited to the following: the removal, disposal, and placement of new concrete for sidewalks, curbs, ramps, etc.

D. Traffic control shall be used at all locations and in conformance with City of Palm Springs Standards, WATCH Manual (Latest Edition), and State and Federal Regulations.

E. Contractor must give 48 -hour advance notice to the City’s Project Manager, prior to the start of pavement repair work.

F. Concrete Class shall be 560 C 3250 white pigmentation or curing compound in sidewalks, driveways, cross gutters, spandrels and curb and gutter, etc.

G. Contractor shall provide all BMP’s as needed during construction at each site.

Following construction, sites must be left in neat, orderly, and clean condition.

H. All concrete pavement repairs shall be completed within ten (10) working days after the Contractor receives written approval from the City’s Project Manager.

1.3 Bonding:

Page 12 of 27 ends

Surety issued by the Insurance Commissioner, which authorizes the Insurer or Surety to transact surety insurance in the State of California.

1.4 Pricing:

1. The pricing included in this Contract shall be firm for the first year.

1.5 Payment:

1.6 Invoicing:

Contractor will submit an itemized invoice monthly. Billings must reference a purchase order number and shall indicate the unit (contract) price. Contractor will be paid for the actual hours worked at the rates shown in the contract. Parts, materials, equipment, and subcontractor costs will be compensated at actual cost with receipts required with allowable markup as outline in the contract. Contractor shall break out the line items on the invoice in accordance with the line items on the bid form. Contractor must provide back-up documentation for materials, subcontractor, rented equipment, permits, disposal and recycling fees. Invoices that are submitted with incorrect prices may be returned for correction before any payments to the contractor are authorized. It shall be the contractor’s responsibility to submit a correct invoice. The City shall not be responsible for payment until a correct invoice is received. The invoice shall be accompanied by receipts, dated, and signed by a City Employee, verifying the work was done. Invoices and receipts will be submitted to the Contract Officer for approval. All invoices are to be sent as one document, per month to: [email protected] .

Item 1I - Page 16

Page 13 of 27 ends

Item 1I - Page 17

ATTACH MENT G

BID FORM
INVITATION FOR BIDS {IFB 24-04)

ON-CAL L CONCRETE REPAIR AND REPLACEMENT SERVIC ES
Responding to this IFB for on-call concrete repair and replacement services. the undersign ed bidder proposes and agrees to provide the services and work in accor:tance with the specifications. Bidder proposes and agrees to furnish all labor, equipment. materials, supervision, and service necessary to comple te said Work in accordance with the Specifications of the City of Palm Springs and will accept as full payment therefore, the follow ing unit cost amounts. The City of Palm Springs will not accept any additional charges, lees, etc. that are not already included or incorporated in the below unit costs.

ITEM DESCRIPTION UNIT ESTIMATED UNIT PRICE SUBTOTAL QUANTITY Mobilization and demobilization.
1 Multiple relocations to various LS 1 locations within the City or Palm

19.rr.fY'"' :z ~ f\Q/'\ ~· Snrinns
Implement Traffic Control plan
2 per the WATCH Manual (multiple LS 1
nhases at various locations). I ,I I .IV\ oo 1,1 ,.,v, 00 3 SWPPPIBMP Implemen tation at LS 1 1\71,A'° 11 71 #\ •• mulliole locations.

Remove, dispose. and replace 4''
Thick PCC Sidewalk Per City
4 Standard #230. Concrete Class SF 60,000 560 C 3250 with white pigmentation er curing
l 9 .
0 • I I .Ltf\ (\ (\(\ 0 com'"""'und.

Remove, dispose, and replace 6"
Thick PCC Dri·,e Approach Per
5 City Standa rd #240. Concrete SF 2,400 Class 560 C 3250 with white pigmentation or curing
comnound . "JI•.•• I .1 ,<\N'\,oo
Remove, dispose, and replace 8"
Thick PCC Drive Approach Per
6 City Standard #255. Concrete SF 1,500 Class 560 C 3250 with white pigmentation ex curing
comnound. :2.4. bo c; I f\t\r'\ Oo
Remove, dispcse, and replace
Type A PCC Curb Per City
7 Standard #200. Concrete Class LF 2,100 560 C 3250 with white pigmentatio n or curing
Q,i.oO 17 U AJ'\r'\ . 00 com"""'und.

Remove, dispose, and replace
8 Type B PCC Curb & Gutter Per LF 900
t r\7 Ob Citv Standard #205. Concrete £l1. ?)N\_•o

Page 14 of 27 ends

Item 1I - Page 18
Class 560 C 3250 with white
pigmentation or curing
comoound.

Remove, dispose , and replace
Sidewalk Ramp. New ramp must
be ADA Compliant per City of
9 Palm Springs Policy for EA 48 Accessible Pedestrian Facilities.

Concrete Class 560 C 3250 with
white pigmentation or curing
comoound. ll'\7N\ ,00 Ir:::. 1-:Jr. I ..nr.. oo
Cross Gutter and Spandrel.
10 Concrete Class 560 C 3250 with SF 5,400 white pigmentation or curing comoound. ?,.<l._•o \ <i<:31 rf\f'\ O<)
11 Sidewalk Panel GrindinQ EA 12 .....;.t f) co 11'1 ,·1.11 ,"'0 12 Remove, dispose, and replace EA 15 :2, l ,l",f\ O' '5 4 ('£)(\,"" Curb Drain TOTA L (Enter this amount in PlanetBids)
73'il41ir 00
"NOTE: This bid form is to determine the lowest bidder and will be used to establish the contract unit prices. The contract will be set at the City budget amount.

Firm Name: Hardv & Har ,er Inc.

DIR Number: I 000000076
Printed Name: Michael Murra
Title: Vice President
Date: A ril 2 2024

Page 15 of 27 ends

EXHIBIT “B”

INSURANCE PROVISIONS

Including

Verification of Coverage,

Sufficiency of Insurers,

Errors and Omissions Coverage,

Minimum Scope of Insurance,

Deductibles and Self-Insured Retentions, and

Severability of Interests (Separation of Insureds)
Item 1I - Page 19

Page 16 of 27 ends

INSURANCE

Contractor shall procure and maintain all insurance at its sole cost and expense, in a form and content satisfactory to the City, and submit concurrently with its execution of this Agreement .

2. Minimum Scope of Insurance. The minimum amount of insurance required under this Agreement shall be as follows:

2. Automobile liability insurance with limits of at least one million dollars ($1,000,000.00) per occurrence;

Item 1I - Page 20

Page 17 of 27 ends

In addition to the endorsements listed above, the City of Palm Springs shall be named the certificate holder on the policies.

Failure to obtain the required documents prior to the commencement of work shall not waive the Contractor’s obligation to provide them.

Item 1I - Page 21

Page 18 of 27 ends

Item 1I - Page 22

Page 19 of 27 ends

EXHIBIT “C”

Item 1I - Page 23
ATTACHMENT "F"
EXECUTIVE ORDER N-6-22 CERTIFICATION
INVITATION FOR BIDS (IFB 24-04)
ON-CALL CONCRETE REPAIR AND REPLACEMENT SE.RVICES
Executive Order N-6-22 issued by Governor Gavin Newsom on March 4, 2022, directs all agencies and departments that are subject to the Governor's authority lo (a) terminate any contracts with any individuals or entities that are determined to be a target of economic sanctions against Russia and Russian entities and individuals; and (b) refrain from entering into any new contracts with such individuals or entities while the aforementioned sanctions are in effect.

Executive Order N-6-22 also requires that any contractor that: (1) currently has a contract with the City of Palm Springs funded through grant funds provided by the State of California; and/or (2) submit$ a bid or proposal or otheiwi&e p.-opo~ tu u, erlle1 iutu or renew a contract with the City of Palm Springs with State of California grant funds, certify that the person is not the target of any economic sanctions against Russia and Russian enttties and individuals.

The contractor hereby certifies, SUBJECT TO PENAL TY FOR PERJURY, that a) the contractor is not a target of any economic sanctions against Russian and Russian entities and individuals as discussed in Executive Order N-6-22 and b) the person signing below is duly authorized to legally bin/ the Contrac or. This certification is made under the laws of the State of Cal~ornia.

Signature: ~
Printed Name: M1chael ~~
Title: Vice President
Firm Name: l-lardv & I larpcr. Inc.

Date: April 2. 2024

Page 20 of 27 ends

EXHIBIT “D”
PAYMENT BOND – PUBLIC WORKS

KNOW ALL MEN BY THESE PRESENTS,

PROJECT NAME
CITY CONTRACT NO. 24B083

Item 1I - Page 24

Page 21 of 27 ends

PAYMENT BOND – PUBLIC WORKS
(CONTINUED)

No final settlement between the City and the Contractor hereunder shall abridge the right of any beneficiary hereunder, whose claim may be unsatisfied.

SIGNED AND SEALED, this ____ day of __________________, 20____.

CONTRACTOR:

Check one: ____ individual, ___ partnership, ___ corporation

(This Payment Bond must be signed by representatives and/or officers having appropriate authority to bind the Contractor and Surety to the terms of the Payment Bond.)

EXECUTED FOR THE CONTRACTOR: EXECUTED FOR THE SURETY:

By: By:

signature signature
(NOTARIZED) (NOTARIZED)

Print Name and Title: Print Name and Title:

signature
(NOTARIZED)

Print Name and Title:

Item 1I - Page 25

Page 22 of 27 ends

PAYMENT BOND – PUBLIC WORKS
(CONTINUED)

The rate of premium on this bond is $________ per thousand.

The total amount of premium charged: $__________

(The above must be filled in by corporate surety).

Any claims under this bond may be addressed to:

(Name and Address of Surety)

(Name and Address of Agent or
Representative for service of
process in California if
different from above)

(Telephone Number of Surety and
Agent or Representative for
service of process in California)

Item 1I - Page 26

Page 23 of 27 ends

PAYMENT BOND – PUBLIC WORKS
(CONTINUED)

ALL-PURPOSE ACKNOWLEDGMENT

State of

County of

On __ _ before me, , Date Name, Title of Officer personally appeared ,

NAME(S) OF SIGNER(S)

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

Witness my hand and official seal.

__________________________________
Signature of Notary

ATTENTION NOTARY: Although the information requested below is OPTIONAL, it could prevent fraudulent attachment of this certificate to unauthorized document.

THIS CERTIFICATE Title or Type of Document

MUST BE ATTACHED
TO THE DOCUMENT Number of Pages DATE of DOCUMENT DESCRIBED AT RIGHT:

Signer(s) Other Than Named Above_____________________________________________________

Item 1I - Page 27

Page 24 of 27 ends

EXHIBIT “E”
PERFORMANCE BOND – PUBLIC WORKS

KNOW ALL MEN BY THESE PRESENTS,

PROJECT NAME
CITY CONTRACT NO. 24B083

(hereinafter referred to as the “Public Work”); and

WHEREAS, the Contractor is required by said Contract to perform the terms thereof, and to provide a bond both for the performance and guaranty thereof.

NOW, THEREFORE, we, the undersigned Contractor, as Principal, and:
,
a corporation organized and existing under the laws of the State of ____________, and duly authorized to transact business under the laws of the State of California, as Surety, are held and firmly bound unto the City in the sum of ______________________________________________ Dollars ($_________________), said sum being not less than 100 percent of the total amount payable by the City under the terms to the said Contract, for which amount well and truly to be made, we bind ourselves, our heirs, executors, administrators, successors, and assigns, jointly and severally, firmly by these presents.

No final settlement between the City and the Contractor shall abridge the right of any beneficiary hereunder, whose claim may be unsatisfied.

Item 1I - Page 28

Page 25 of 27 ends

PERFORMANCE BOND – PUBLIC WORKS
(CONTINUED)

SIGNED AND SEALED, this ____ day of ___________________, 20____.

CONTRACTOR:

Check one: ____ individual, ___ partnership, ___ corporation

(This Performance Bond must be signed by representatives and/or officers having appropriate authority to bind the Contractor and Surety to the terms of the Performance Bond.)

CONTRACTOR: SURETY:

By: By

signature signature
(NOTARIZED) (NOTARIZED)

Print Name and Title: Print Name and Title:

By:

signature
(NOTARIZED)

Print Name and Title:

Item 1I - Page 29

Page 26 of 27 ends

PERFORMANCE BOND – PUBLIC WORKS
(CONTINUED)

The rate of premium on this bond is $________ per thousand.

The total amount of premium charged: $__________

(The above must be filled in by corporate surety).

Any claims under this bond may be addressed to:

(Name and Address of Surety)

(Name and Address of Agent or
Representative for service of
process in California if
different from above)

(Telephone Number of Surety and
Agent or Representative for
service of process in California)

Item 1I - Page 30

Page 27 of 27 ends

PERFORMANCE BOND – PUBLIC WORKS
(CONTINUED)

ALL-PURPOSE ACKNOWLEDGMENT

State of

County of

On __ _ before me,
Date Name, Title of Officer personally appeared ,

NAME(S) OF SIGNER(S)

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

Witness my hand and official seal.

THIS CERTIFICATE Title or Type of Document

MUST BE ATTACHED
TO THE DOCUMENT Number of Pages DATE of DOCUMENT DESCRIBED AT RIGHT:

Signer(s) Other Than Named Above

Item 1I - Page 31

ATTACHMENT B

Item 1I - Page 32
Item 1I - Page 33

1. 2.

3. 4.

5. Name of Entity
Hardy & Harper, Inc.

PUBLIC INTEGRITY DISCLOSURE

APPLICANT DISCLOSURE FORM
Address of Entity (Principal Place of Business)
32 Rancho Circle, Lake Forest, CA 92630
Local or California Address (if different than #2)
NIA
State where Entity is Registered with Secretary of State California
If other than California, is the Entity also registered in California? D Yes D No Type of Entity
IXl Corporation D Limited Liability Company D Partnership D Trust D Other (please specify)

6. Officers, Directors, Members, Managers, Trustees, Other Fiduciaries {please specify) Note: If any response is not a natural person, please identify all officers, directors, members, managers and other fiduciaries for the member, manager, trust, or other entity
Dan T. Maas IX! Officer D Director D Member D Manager
[name] D General Partner D Limited Partner
Other
Michael Murray ~ Officer D Director D Member D Manager
[name] D General Partner D Limited Partner
D Other
Kristen Paulino IX! Officer D Director D Member D Manager [name] D General Partner D Limited Partner
Other
Item 1I - Page 34

7. Owners/Investors with a 5 % beneficia l interest in the Applicant Entity or a related entity

EXAMPLE
JANE DOE 50%, ABC COMPANY, Inc.
(name of owner /investor] [percentage of beneficial inte rest in entity and name of entity]
A.

Dan T . Maas 100%, Hardy & Ham er, Inc .
[name of owner /investo r] [percentage of benefic ial inte rest in entity and name of entity ]
B.
(name of owner /investor] [percentage of bene ficial interest in entity and name of entity]
C.
[nam e of owner/investor] [percentage of beneficial interest in entity and name of entity]
D.
[name of owner/ investor] [percentage of beneficial interest in entity and name of entity]
E.
[name of owner /investo r]
I
[percentage of beneficia l inte rest in entity
/ and nam e of entity ]
I DECLARE UNDER PENAL~z PERJURY UNDER THE LAWS OF THE STATE OF CALIFORNIA THAT THE Fo.1/17 _ING IS TRUE AND CORRECT.

Sig~~ed Name, Title Date
April 2, 2024
Micha~ ~ V' resident
~

CITY COUNCIL STAFF REPORT

DATE: MAY 9, 2024 CONSENT CALENDAR

SUBJECT: A PPROVE OPENING THE COMMUNITY INITIATED PROJECT

APPLICATION PROCESS FOR MEASURE J WITH AVAILABLE FUNDS
OF $6 MILLION

FROM: Scott C. Stiles, City Manager

BY: Department of Finance and Treasury

SUMMARY:

The Measure J Commission is recommending to the City Council to open up the Community Initiated Project application process with available funds for projects to be $6 million with a $500,000 cap per project.

RECOMMENDATION:

Approve opening the application process for Community Initiated Projects with the timeline indicated in the application (beginning June 3, 2024) and available funds of $6 million with a $500,000 cap per project, and a set -aside for project overages of $1.2 million.

BACKGROUND:

The Measure J sales tax is a 1% local measure sales tax approved by the City’s registered voters in November 2011, and put in place in April 2012. The tax is currently set to expire in March 2037. Historically, the City Council has approved funds from this sales tax for Community Initiated Projects. These are projects that are initiated by residents of the City through an application process. A resident will fill out the application and submit it to the Measure J Commission. The Commission will review all of the projects submitted and make a recommendation to the City Council on projects to be funded.

STAFF ANALYSIS:

At the Measure J Commission meeting on April 18, 2024, the subcommittee reviewing the existing application submitted the improved application to the Commission for approval. The improvements were mostly to make the application more clear on the Item 1J - Page 1
City Council Staff Report
May 9, 2024 -- Page 2
Measure J Community Initiated Project Application

project submitted and to try and improve the project estimated cost to reduce project cost overages. The Commission approved the application and recommended it be taken to the City Council for final approval, with any adjustments that may be recommended by the City Attorney (Attachment A).

The proposed budget for Community Initiated Projects for fiscal year 2024 and 2025 is a combined $7.2 million. The Commission is recommending the use of $6 million directly for projects, with a $500,000 cap per project. The additional $1.2 million can be used for projects that come in over the estimate on the application. Any unused funds will continue to roll over to future years.

ALIGNMENT WITH STRATEGIC PLANNING:

This item aligns with the City Council priorities of Forward- Thinking Governance and Quality of Life.

FISCAL IMPACT:

Funds are sufficiently budgeted in 2603080-80000.

REVIEWED BY:

Department Director: Kristopher J. Mooney
City Attorney: Jeffrey Ballinger
City Manager: Scott Stiles

ATTACHMENTS:

A. Measure J Community Initiated Project Application

Item 1J - Page 2

ATTACHMENT A

Item 1J - Page 3
1 CITY OF PALM SPRINGS
Measure J Community Initiated Projects
2024-25 Project Application Form
Thank you for your interest in using Measure J funds for your project. To ensure the best outcome for your project, we suggest you read all the information provided in this packet and visit the Measure J website prior to completing the application form.

What is Measure J?
Measure J was enacted in 2012 by the voters of Palm Springs to support projects that enhance the livability and overall quality of life for people who live, work, and play in our City. The funding source is a 1% supplemental sales tax.

What does Measure J fund?
Measure J has funded hundreds of important citywide services and capital improvement projects, including the Downtown Revitalization Project, the new Downtown Park, hundreds of miles of city street paving, public park improvements, and the renovations of the Welwood Murray Memorial Library and the fire station on LaVerne Way. Currently, Measure J is helping fund the expansion of pickleball courts at Demuth Park, improvements to playground park equipment, and renovations to the Palm Springs Public Library and the historic Plaza Theatre.

What does Measure J not fund?
Measure J is a funding source for strategic and necessary capital improvements , enhancements, and major repairs within Palm Springs. Accordingly, the Commission does not fund proposals for events, wages, services, or programming.

What ar e Community Initiated Projects?
Community Initiated Projects are projects that are proposed by individual citizens, neighborhood organizations, and non-profit organizations in Palm Springs that are wholly or partially funded through Measure J. The Measure J Oversight Commission intends to fund projects totaling up to $6 million during this award process, with an intended maximum of $ 500,000 to any individual project.

There are two types of awards av ailable:
• Fully-Funded and City -Implemented Projects : These are project proposed by individual citizens and other groups that require full funding by Measure J and that are carried out by City staff.
• External Project Grants : These are projects proposed by local organizations who can implement their own project with little to no involvement from the City. Given the limited funding available, organizations seeking a grant for their project should supplement the cost with private or other forms of additional funding.

Item 1J - Page 4
2 How are Community Initiated Projects evaluated and selected for funding? Submitted applications will be reviewed and prioritized by the Measure J Oversight Commission based on the following factors:

• Thoroughness of the application
• Overall alignment with the goals of Measure J funding • Alignment with the City’s Strategic Plan and departmental plans • Does this project require little to no ongoing costs? • Does this project make Palm Springs a safe, desirable place to live, work, and visit? • Does this project benefit the majority of residents, guests, and/or tourists in our City? • Does this project improve the health and safety of our residents of Palm Springs? • Does this project promote the growth of tourism in the City? • Does this project provide a benefit to the community over a long period? • Does the City have the staff resources to complete the project in a reasonable timeframe.

Or can the applicant implement the project without City resources?

Application tips:

As you prepare your application, please consider the following guidance:

• The project must be within the City of Palm Springs and on property that is independent of County, State or Tribal restrictions. Street-related projects must be on City roadways and not on State, County, or Tribal roadways.
• Please vet the scope, expected project schedule, and estimated cost of your project as much as possible prior to submission. At a minimum, utilize the Project Cost Worksheet included with the application form. Y ou need to clarify who will manage the project if approved. Please include information regarding how you arrived at your estimated project costs. We encourage proposals that include thorough research including preliminary estimates by vendors/contractors. For projects that would be undertaken by the City, any necessary subsequent evaluation will be done by City staff. Proposals with greater clarity on expected costs and implementation will be prioritized. • Applicants are encouraged to seek input from City commissions, departments, or staff prior to making a submission. These are resources that may have considerable knowledge to help shape your proposal. This joint support or additional input can be extremely helpful to the Measure J Commission in the evaluation process.
• Keep in mind that the amount of Community Initiated Funds available is limited. Projects that are smaller and require minimal staff time to implement are desirable as are projects submitted by organizations that can be awarded in the form of a grant.

Item 1J - Page 5
3 Application Process and Timeline
June 3, 2024
Ap
plication forms will be available on the City’s website for Measure J at www.PSMeasureJ.com. Hard copies will also be made available for pick up at various City facilities, including but not limited to, City Hall, Palm Springs Main Library, Welwood Murray Library, Demuth Park Community Center, James O. Jessie Desert Highland Unity Center, and Leisure Center.

Contact information for City staff, departments and commissions are available using the following links:

Measure J Oversight Commission Secretary:

Melissa Sanchez, [email protected]
All oth
er additional departments are identified on web link below:
https://www.palmspringsca.gov/government/departments
September 30, 2024
Completed applications must be submitted, preferably via email to me
[email protected] , by mail or in-person at:

City
of Palm Springs
Attn: Melissa Sanchez – Finance Department
3200 E. Tahquitz Canyon Way Palm Springs, CA 92262
October 1, 2024 –
January 31, 2025
Applic
ations will be reviewed and prioritized by the Measure J Commission. Selected project applicants may be asked to provide additional information or a brief presentation to the Commission.

Applicants will be informed as to whether their application is being considered further.

City staff will evaluate the feasibility of submissions and how they might relate to other projects already in process or planned by the City. Staff will provide its feedback and recommendations to the Commission.

The Commission will make final recommendations to the Palm Springs City Council for approval. Applicants will be informed as to whether their project is being recommended to the Council.

Final applicants will be informed regarding City Council approval of their project and next steps for their project.

Item 1J - Page 6
4 Measure J Community Initiated Projects
Application Form

Name and Address of Project:

Name of Applicant:

Date Submitted: Name of Organization (if applicable):

Applicant’s Phone Number: _________________________ Email Address: ________________________ Applicant Type:
☐ Individual
☐ Non-Profit Organization
☐ Neighborhood

☐ Other Organization
☐ City Commission
If you are a non-profit organization, please provide your federal tax ID # Project Type:
☐ City implemented project ☐ Organizational – implemented project (grant) Tell us about your project:

1. Does this project improve…? (check all that apply)
☐ the economy
☐ health services
☐ business community
☐ educational services
☐ government services
☐ police/fire/emergency services
☐ public art
☐ park/recreation/hiking facilities
☐ historic preservation
☐ streets/roads
☐ downtown enhancements
☐ tourism
☐ sustainability/conservation
☐ technology
☐ other

2. What demographic(s) does this project serve? (check all that apply) ☐ seniors
☐ children/students
☐ entire Palm Springs community
☐ LGBTQ+
☐ animal welfare
☐ individuals with disabilities
☐ other

3. Complete the attached Project Overview and Cost Worksheet . This should provide a thorough description of your proposed project including why it is a need, who will benefit, what the project entails, where the project is located, etc. Further, d escribe any substantive discussions or endorsements you have developed with City staff, commissions, or active volunteer groups to shape your proposal and to identify any potential duplication of efforts. For example, if your project is an improvement to a park, have you explored your ideas with the Parks and Recreation Department or its Commission?

Signature: Date:

Item 1J - Page 7
5 Project Overview and Cost Worksheet

Project Name and Location:

Provide a detailed description of the concept and benefits of your proposal.

Describe and identify any substantive discussions or endorsements you have developed with City staff, commissions, or volunteer groups to shape your proposal and to identify any potential duplication of efforts.

Project Cost Worksheet

Design/Consulting Costs:

Equipment/Materials Costs:

Construction Costs (identify cost allocation for major trades, is available):

Insurance:

Other Fees:

Contingency:

Total:

Item 1J - Page 8
6 Project Duration, including lead time to order materials and mobilize contractors:

Des
ignated Project Manager:

For
organizational implemented grants, identify your other funding sources to complete the project and the percentage of total this represents.

Sign
ature: Date:

Item 1J - Page 9

CITY COUNCIL STAFF REPORT

DATE: MAY 9, 2024 CONSENT CALENDAR

SUBJECT: APPROVE AGREEMENT WITH FRONTIER COMMUNICATIONS

CORPORATION FOR FIVE YEARS OF TELECOMMUNICATIONS

SERVICES

FROM: Scott Stiles, City Manager

BY: Information Technology Department

SUMMARY:

This action will approve an agreement (Attachment A) with Frontier Communications for five years of telecommunications services at a cost not to exceed $1,323,080.

RECOMMENDATION:

1) Approve an agreement with Frontier Communications for five years of telecommunications services at a cost not to exceed $1,323,080.

2) Ratify past purchases of telecommunications services from Frontier Communications

3) Authorize the City Manager to execute all documents associated with this purchase.

BUSINESS PRINCIPAL DISCLOSURE:

Frontier Communications Corporation is a publicly traded company listed on the NASDAQ under the symbol FYBR.

Item 1K - Page 1
City Council Staff Report
May 9, 2024 - Page 2
Approve Agreement with Frontier Communications Corporation

BACKGROUND:

The City of Palm Springs currently utilizes both Frontier and Charter for Internet and telecommunication services. The services are provided at most if not every facility, and some critical facilities have connections from each provider to create redundancy and failover. The connections range from small Internet connections at remote buildings, to large multi gigabit connections at large facilities such as City Hall, the Police Department and Airport. The City also uses Charter to create virtual private connections between facilities for secure communications.

Staff has been purchasing services from Frontier for years. The payments that have been processed since the City has migrated to our new Tyler Munis financial system in July of 2019 total $1,114,945.

STAFF ANALYSIS:

The City currently spends $2 13,560 each year for telecommunication services with Frontier and expects to continue this spend level into the future. In addition to current spending, Council has also approved migrating to the Public Safety Enterprise Communications (PSEC) radio system circuit which will all require an additional circuit for backup connectivity. Staff received quotes from Frontier to order the new services , and the summary of the new Frontier annual service charges is below with a 10% contingency included for upgraded service or price increases over the five-year term.

12 Month Actuals $213,560
PSEC Circuit $27,000
$240,560
10% Contingency $24,056

$264,616

Approximate 5 yrs $1,323,080

Staff is recommending approval of an agreement with Frontier Communications for five years of telecommunications services for an amount not to exceed $1,323,080.

ENVIRONMENTAL ASSESSMENT
:

The requested City Council action is not a “Project” as defined by the California Environmental Quality Act (CEQA). Pursuant to Section 15378(a), a “Project” means the whole of an action, which has a potential for resulting in either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. The requested action is to approve contracts for t he above- mentioned services, and is exempt from CEQA pursuant to Section 15378(b), in that a “Project” does not include: (5) Organizational or administrative activities of governments that will not Item 1K - Page 2
City Council Staff Report
May 9, 2024 - Page 3
Approve Agreement with Frontier Communications Corporation

result in direct or indirect physical changes in the environment.

ALIGNMENT WITH STRATEGIC PLANNING:

Approval of this action supports City Council Principle optimize basic services and facilities.

FISCAL IMPACT:

Sufficient funds are budgeted and available in the current fiscal year in Information Technology Department Account 1001025 – 50031 and Airport Department Account 4157021 – 50031.

REVIEWED BY:

Department Director: Larry Klingaman
Procurement & Contracting Director: Kim Baker
Deputy City Manager: Jeremy Hammond
City Manager: Scott Stiles

ATTACHMENTS:

A. Agreement
Item 1K - Page 3

ATTACHMENT A

Item 1K - Page 4
Frontier Services Agreement
Terms and Conditions
Frontier Confidential
Ver. 04252022_082023 Page 1 of 5
This Fr
ontier Servi ces Agreement (“FSA”) is effective as of , 20 , by and between Frontier Communications of America, Inc. on behalf of itself and its affiliates which provide Equipment and Services identified in the Schedules (“Frontier”), and the City of Palm Springs, a California Municipal Corporation, whose primary address is 3200 E Tahquitz Canyon Way, Palm Springs, CA 92262 (“Customer”).

1. Provision of Services and Equipment
a. Frontier will provide and the Customer agrees to pay for the communications, installation and maintenance services (collectiv ely “Service”), and/or purchase or lease equipment (“Equipment”), described in this FSA and Schedules executed by Customer. b. Customer acknowledges that certain Services may be governed by tariff or price schedule filed with the Federal Communications Commission and/or the state public utilities commission. In the event of any inconsistencies between this FSA and an applicable tariff, the tariff shall control except with respect to pricing, early termination charges or cancellation charges for which this FSA shall control. c. Frontier will provide, maintain and repair the Frontier owned facilities and equipment used to provide the Services (“Frontier(‘s) Network”), up to and including the point at which Frontier’s Network is made available for interconnection to Customer’s premises equipment or inside wiring. Upon reasonable advance notice when possible given the timing of the event and its impact on Frontier, Customer shall provide Frontier reasonable access to Customer’s premises during normal business hours for the purpose of installing, inspecting, testing, rearranging, repairing or removing any Frontier Network components, including obtaining approvals, permits or licenses from third parties as necessary. Customer will cooperate in good faith and provide all reasonable information and authorizations required by Frontier for the purpose of installing Services and/or Equipment, performing routine network grooming, maintenance, upgrades, and addressing emergencies, including but not limited to design layout records of any Customer or third party network elements to be connected to the Services and Letters of Agency allowing Frontier to act on the Customer’s behal f related to the Services and auxiliary third party services.
d. Only authorized agents and representatives of Frontier may perform maintenance work with respect to Frontier’s Network. Any repair, alteration, configuration or servicing of Frontier’s Network, Services or Equipment by Customer or third parties without the written consent of Frontier is a material breach of this FSA and cause for termination at Frontier’s option. e. If Frontier is unable to commence performance hereunder due to circumstances within Customer’s control, any related costs incurred by Frontier, including but not limited to travel at normal rate and overtime labor rate expenses, will be reimbursed by Customer. Customer will reimburse Frontier for all costs incurred for installation, maintenance and repair if: (i) Frontier’s Network is altered, maintained or repaired by any party other than Frontier, without Frontier’ prior written consent, (ii) the malfunction of the Service or Equipment is the result of mishandling, abuse, misuse, improper operation, improper storage, or improper installation by anyone other than Frontier (including use in conjunction with equipment electrically or mechanically incompatible); or (iii) if the problem originated from a source unrelated to Frontier’s Network. f. Customer will provide (i) suitable building facilities (including but not limited to space, circuitry, power, backup power, and surge protectors) for the installation, operation, and maintenance of Frontier’s Network in accordance with manufacturer’s documentation and Frontier’s installation standards, more fully described in the applicable Schedule; and (ii) a well -lighted and safe working area that complies with all local safety standards and regulations.
g. The Services or Equipment may be connected with the services or facilities of other carriers. Frontier may, when authorized by Customer and as may be agreed to by Frontier, act as Customer’s agent for ordering facilities provided by other carriers to allow such connection of Customer’s locations to Frontier’s Network or to the network of an underlying carrier or service. h. Customer is responsible for all charges billed by other carriers or third parties. Frontier shall not be responsible for the installation, operation, repair or maintenance or performance of equipment, facilities, software or service not provided directly by Frontier. Customer is responsible to provide equipment compatible with the Service or Equipment and Frontier's Network, and any wiring required to extend a communications termination and/or demarcation at the Customer premises. Customer will provide suitable building facilities for the provision of Services in accordance with local codes, including but not limited to ducting, conduit, structural borings, etc. for cable and conductors in floors, ceilings and walls; electrical service with suitable terminals and power surge protection devices; and metallic grounds with sufficient slack in the equipment room, installed in conformity with the National Electrical Code and local codes, and Frontier’s installation standards. i. Customer is solely responsible for the selection, implementation and maintenance of security features for protection against unauthorized or fraudulent use of the Services and Equipment. Customer is solely responsible for (a) ensuring that all of Customer’s data is adequately secured, documented and backed- up at all times and (b) reimbursing Frontier for reasonable costs incurred by Frontier related thereto. Frontier and its contractors are not responsible or liable for data loss and/or unauthorized or fraudulent use of Customer Services or Equipment for any reason and Customer agrees to reimburse Frontier for costs incurred by Frontier related thereto. j. Frontier will manage the Frontier Network in Frontier’s sole discretion, and reserves the right to substitute, change or rearrange any equipment or facilities used in delivering Services or provisioning the Equipment. Frontier will endeavor to provide reasonable notice prior to any scheduled maintenance, planned enhancements or upgrades, which may result in a degradation or disruption in Service. Frontier reserves the right to suspend Service for emergency maintenance to Frontier's Network without notice to Customer. Customer shall designate a primary contact for receipt of such notice.
k. Customer represents and warrants that its use of the Service and Equipment will comply and conform with all applicable federal, state and local laws, administrative and regulatory requirements and any other authorities having jurisdiction over the subject matter of this FSA and Customer will be responsible for applying for, obtaining and maintaining all registrations and certifications which may be required by such authorities with respect to such use.

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l. Except as expressly identified in a Schedule, Customer and its employees shall be the only permitted end- user of the Services and leased Equipment. Customer shall not resell or bundle the Services or leased Equipment, nor permit any third party to access the Services or leased Equipment in exchange for compensation of any kind.

2. Term
The term of this FSA will commence as of the date identified in the introductory paragraph above or the date the FSA is executed by both Parties, whichever is later (the “Effective Date”) and will continue through the Service Term with respect to any Service or Equipment provided pursuant to this FSA. Customer will purchase the Services, or lease Equipment, identified in each Schedule for the period of time stated in the Schedule (the “Service Term”). Unless otherwise stated in the Schedule, the Service Term and billing for the Service, will begin upon the earlier of (i) Cus tomer’s use of the applicable Service(s) or Equipment or (ii) five (5) days following Frontier’s installation of such Service(s) or Equipment, and such date is deemed the commencement of the applicable Service Term. If neither party provides the other with written notice of its intent to terminate a Service at least sixty (60) days prior to expiration, at the conclusion of the Service Term, all products remaining in service will automatically renew on a month- to-month basis and be billed at the then applicable month- to-month rates. If the parties agree to negotiated renewal terms, such terms will not be effective unless and until documented in writing and executed by both parties.

3. Payment
a. Customer shall pay all charges set forth in the Schedules and in applicable tariffs during the Service Term. Frontier will invoice Customer any non-recurring charges (“NRC”), monthly recurring charges (“MRC”), and usage based charges. b. In addition to the applicable charges set forth in the tariffs and Schedules, Customer shall pay all applicable federal, stat e or local sales, use, privilege, gross receipts, utility, value added, excise or other taxes (excluding taxes based on Frontier’s net income), or any charges in lieu thereof, and any applicable surcharges or fees, whether government mandated or Frontier initiated including but not limited to Primary Interexchange Carrier Charge, Federal Pre-Subscribed Line Charge, Carrier Cost Recovery Surcharge, E -911, and Universal Service and Local Number Portability, in the amounts applicable at the time of billing. Customer shall also be responsible for third party charges and penalties incurred as a result of Customer’s use of the Services or Equipment and/or unauthorized or fraudulent use thereof due to Customer’s conduct. c. All payments shall be due within thirty (30) days of the invoice date and, in addition to and not in lieu of any other remedies Frontier may have hereunder or under the law as a result of Customer’s failure to pay, late payments shall be subject to a late payment fee of the lesser of one and one - half percent (1.5%) per month or the maximum allowed by law. In the event Customer disputes any invoiced amount, Customer will pay all charges not disputed, and notify Frontier of the dispute in writing, providing an explanation of the basis for the dispute. If Frontier does not receive notice of a payment dispute by Customer within ninety (90) calendar days after the date of an invoice, such invoice will be final and not subject to further challenge.

For the purpose of computing partial month charges, a month will consist of thirty (30) calendar days. Frontier reserves the right to immediately suspend or terminate any or all Services or the installation or lease of any or all Equipment if Customer is overdue more than thirty (30) days for payments that have not been disputed in good faith.

4. Cancellation and Early Termination Charges
a. If Customer cancels any Service or Equipment prior to delivery of any Equipment or installation of the Service or Equipment, Customer shall pay the reasonable total costs and expenditures of Frontier in connection with establishing the Service prior to Frontier’s receipt of notice of cancellation. b. Following installation, Customer may terminate a Service or Equipment by providing at least thirty (30) days prior written notice to Frontier. All unpaid amounts shall be due upon termination of any Service identified in a Schedule for any reason. In addition, and unless otherwise specifically provided in the applicable Schedule, if any Service or Equipment is terminated by Customer for any reason other than breach by Frontier or by Frontier due to Customer’s breach, then Customer shall pay Frontier a termination charge equal to the applicable MRC and all related t axes and surcharges multiplied by the number of months remaining in the Service Term. Partial months shall be prorated. c. Customer agrees that Frontier’s damages in the event of early termination will be difficult or impossible to ascertain, and t hat the charges identified in this Section are intended, therefore, to establish liquidated damages in the event of termination and are not intended as a penalty.

5. Limitation of Liability and Warranty Provisions
a. The liability of Frontier and its affiliates related to this FSA or the Service or Equipment provided under this FSA, shall in no event (a) exceed the limitations of liability set forth in the applicable tariffs, or regulatory rule or order, or (b) if there is no applicable tariff, regulatory rule or order, the total amount paid for the applicable Service or Equipment during the prior 12 months. In cases of an Outage, Frontier’s liability shall be limited to 1/720 of the MRC for each hour after Frontier is notified of the Outage. An “Outage” is an interruption in Service or use of the Equipment caused by a failure of Frontier’s Network, excluding degradation or disruption due to planned or emergency maintenance or an event outside Frontier’ s direct control.

Notwithstanding the above, Frontier will not be liable to Customer for interruptions in Services or Equipment caused by failure of hardware or software, failure of communications services, power outages, or other interruptions not within the complete control of Frontier. In addition, there will be no credits, reductions or set-offs against charges for Services or Equipment, or for interruptions of Services or Equipment, except as expressly set forth herein. b. IN NO EVENT WILL FRONTIER OR ITS AFFILIATES BE LIABLE FOR ANY LOST PROFITS OR BUSINESS OPPORTUNITIES, OR FOR

ANY OTHER SPECIAL, INCIDENTAL, INDIRECT, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES, EVEN IF ADVISED OF THE POSSIBILITY THEREOF. FRONTIER AND ITS AFFILIATES SHALL NOT BE LIABLE FOR ANY LOSS, LOSS OF USE, COST, CLAIM OR EXPENSE

EXPERIENCED OR INCURRED BY CUSTOMER OR THIRD PARTIES RESULTING FROM THE USE OF THE SERVICES OR EQUIPMENT

PROVIDED HEREUNDER, INCLUDING BUT NOT LIMITED TO DAMAGE, LOSS OR LOSS OF USE OF CUSTOMER DATA OR FRAUD BY THIRD PARTIES.

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c. Frontier warrants that Frontier’s Network will be maintained in good working order. If any Service does not function substantially in accordance with applicable Service specifications as a result of Frontier’s failure to maintain Frontier’s Network (excluding degradation related to the acts or omissions of Customer or anyone using the Services, a force majeure event, or scheduled maintenance), Frontier’s sole obligation is to repair the affected Service at Frontier’s expense. THE FOREGOING WARRANTY IS IN LIEU OF ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, AND FRONTIER DISCLAIMS ALL OTHER WARRANTIES WITH RESPECT TO FRONTIER’S NETWORK, SERVICES OR EQUIPMENT PROVIDED

PURSANT TO THESE TERMS INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF NON- INFRINGEMENT, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OR FUNCTION. FRONTIER DOES NOT WARRANT THAT THE SERVICES OR EQUIPMENT OR ACCESS OR OPERATION OF THE SERVICES OR EQUIPMENT WILL MEET CUSTOMER’S NEEDS, OR WILL BE UNINTERRUPTED, ERROR - FREE, OR SECURE.
d. This FSA shall not be construed as granting a license with respect to any patent, copyright, trade name, trademark, service mark, trade secret or any other intellectual property, now or hereafter owned, controlled or licensable by Frontier. Customer agrees that Frontier has not made, and that there does not exist, any warranty, express or implied, that the use by Customer of Frontier’s Services and/or the Equipment provided under this FSA will not give rise to a claim of infringement, misuse, or misappropriation of any intellectual property right. e. Customer agrees that the Services and Equipment, and Frontier’s performance hereunder are subject to the terms, conditions and restrictions contained in any applicable agreements (including software or other intellectual property license agreements) between Frontier and Frontier’s vendors. f. No action, regardless of form, arising out of this FSA or the Schedules may be brought more than three (3) years after the cause of action has arisen or charges have been billed whichever is earlier. The parties hereby waive the right to invoke any different limitation on the bringing of actions provided under applicable law.

6. Indemnification
Customer shall indemnify, defend and hold Frontier and its affiliates, and their respective directors, officers, employees, successors, assigns and agents, harmless from and against any and all claims, loss, damage, cost or expense (including reasonable attorneys’ fees) to the extent arising out or relating to any claim, action or proceeding brought by any third party based upon: (i) Customer’s breach of this FSA; (ii) Customer’s negligence or willful misconduct in the performance of its obligations under this FSA; (iii) use of the Equipment or Services, including but not li mited to the content of communications transmitted thereby; (iv) any infringement of intellectual property or misappropriation of any patent, copyright, trademark, trade secret or other proprietary right arising from Customer’s or any other person’s use of the Equipment or Services, any combination of the Equipment or Services with other products or services not provided by Frontier, or any modification of the Equipment or Services by anyone other than Frontier; (v) any bodily injury (including illness or death) or property damage caused by Customer or anyone within its control. The obligations under this Section 6 are independent of any other obligation under this FSA.

Frontier shall indemnify, defend and hold Customer and its affiliates, and their respective directors, officers, employees, successors, assigns and agents, harmless from and against any and all claims, loss, direct damage, cost or expense (including reasonable attorneys’ fees) to the extent arising out or relating to any claim, action or proceeding brought by any third party based upon: (i) Frontier’s breach of this FSA; (ii) Frontier’s negligence or willful misconduct in the performance of its obligations under this FSA; (iii) any bodily injury (including illness or death) or tangible property damage caused by Frontier or persons within Frontier's control. The obligations under this Section 6 are independent of any other obligation under this FSA.

7. Confidentiality
a. Both parties agree that all terms and conditions set forth in this FSA shall be considered confidential, and that details of the terms of this FSA, shall not be disclosed to third parties, other than affiliates, employees, agents or contractors who have a need to know such information in the scope of their employment or engagement, without the prior written consent of the other party, unless required by law. b. Customer and Frontier may disclose to each other information that is confidential in nature. In order to receive confidential treatment, all such information (hereafter “Information”) shall be either (i) clearly marked as confidential if written, or clearly identified as confidential if oral or (ii) reasonably understood by the recipient, based on the nature of the Information or the circumstances of disclosure, to be confidential or proprietary to the discloser.

Except as required by law or regulation, Customer and Frontier agree not to disclose any Information to any third party and to keep Information in a secure place available only to employees, affiliates, contractors or agents who are subject to obligations of confidentiality no less restrictive than those set forth herein, and who need to know the Information for purposes of the business dealing between Customer and Frontier, and to use Information only in connection with such business dealings. This Section is enforceable by injunction. c. Information will lose its confidential status if obtained legitimately from a third party without restriction or upon the expiration of five (5) years from delivery of each item of Information. Information shall remain the property of the disclosing party and shall be returned to such party on request or upon termination of the business dealing between Customer and Frontier. d. Notwithstanding anything herein to the contrary, Frontier shall have the right to include Customer’s name in a public list of current customers who use Frontier’s services, provided Frontier does not make any representation with respect to Customer and does not attribute any endorsements to Customer. In addition, Frontier may publicly identify Customer as a new customer of Frontier or an existing customer obtaining expanded or additional services from Frontier, as the case may be. Prior to taking any of the actions set forth herein, Frontier shall first obtain advance written consent by Customer, which shall not be unreasonably delayed or withheld.

8. Breach
a. Breach by Customer: If Customer fails to make any payment when due and such failure continues for five (5) days after notice, or Customer fails to comply with any other term or condition of this FSA or any Schedule and such failure continues for thirty (30) days after notice, then Frontier may either suspend the applicable Schedule (or any portion thereof) until the breach is remedied, terminate the applicable Schedule (or any portion thereof), or terminate this FSA and all Schedules. Notwithstanding the foregoing, Frontier may immediately suspend Services and, after giving written notice to Customer with an opportunity to respond appropriate to the circumstances and Customer’s subsequent failure to respond, Frontier may terminate any or Item 1K - Page 7
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all Services, retrieve Frontier Network elements from the service location and Equipment for which title has not transferred to Customer, in the following circumstances: (i) in the event of unauthorized, unlawful or improper use or abuse of the Frontier Network or Service; (ii) if, in the reasonable judgment of Frontier, Customer’s use of the Frontier Network or Service has or will damage or have an adverse effect on Frontier’s Network, its personnel, property or service; (iii) such action is necessary to meet the exigencies of an emergency; or (iv) a court or other governmental authority having jurisdiction issues an order prohibiting Frontier from furnishing the Equipment or Services to Customer. b. Breach by Frontier: If Frontier has not remedied any breach within thirty (30) days after Frontier’s receipt of written notice from Customer of such breach (providing reasonable detail), Customer may terminate the Service which is the subject of such breach. This is Cu stomer’s exclusive remedy for a breach by Frontier.

9. Force Majeure
In no event will either party or its affiliates be liable for any delay in performance directly or indirectly caused by events beyond their control, including, but not limited to: acts of God; acts of the public enemy; acts of the United States, a state or other political subdivision; fire, floods or other natural disasters; accidents; wars; terrorism; cyber security events; labor disputes or shortages; and inability to obtain material, power, equipment or transportation.

10. Assignment
This FSA may not be assigned by either party without the other party’s prior written consent, which consent shall not be unreasonably withheld or delayed, except that Frontier may assign this FSA to any successor to the business of Frontier by merger, consolidation or sale of assets or to any corporation controlling, controlled by or under common control with Frontier. Frontier may subcontract portions of the work to be performed hereunder to provision the Services or Equipment, and shall be liable for all actions performed by its subcontractors as if Frontier was performing the work.

11. Work Site Conditions
a. If asbestos, or material containing asbestos, or any other hazardous or toxic materials are discovered during work pursuant t o this FSA, Frontier will suspend its work for a reasonable period of time to permit Customer to engage a qualified firm to remove and dispose of the asbestos or other toxic or hazardous materials from the site. Such suspension may result in an equitable adjustment to the charges identified in the related Schedule, based on any increase in costs incurred by Frontier. b. Customer agrees to release, indemnify, defend and hold harmless Frontier from and against any damages, losses, claims, demands or lawsuits arising out of or relating to the presence, removal or disposal of asbestos or any other hazardous or toxic material from the Customer’s premises or location where Services or Equipment will be installed.

12. Title and Risk of Loss
a. Risk of loss or damage for Frontier Network elements installed at a Customer designated service location shall pass to Customer at time of delivery to Customer.
b. Any Frontier Network elements or Equipment installed at Customer’s premises or location where Services or Equipment will be i nstalled (which is leased or for which title has not transferred to Customer) remain the personal property of Frontier or Frontier’s assignee, notwithstanding that it may be or become attached to or embedded in realty, and upon termination of this FSA or any Schedule (in whole or in part), all Frontier property shall be returned to Frontier in the same condition as installed, normal wear and tear excepted. Customer will not tamper with, remove or conceal any Frontier identifying plates, tags or labels. In the event Frontier property is not returned to Frontier in accordance with this Section, Customer will be billed for and pay to Frontier an amount equal to the retail value of the Frontier property, except to the extent such failure is caused by the negligence or willful misconduct of Frontier or its agents.

13. Competition
Customer recognizes the availability of competitive alternatives for receiving the Services and Equipment provided under this FSA, and has freely elected to enter into this FSA in order to receive the benefits it offers.

14. Government Regulation
To the extent that any Service(s) provided hereunder are subject to the jurisdiction of the Federal Communications Commission (“FCC”) or any state public utilities commission or other regulatory agency, this FSA shall at all times be subject to changes, modifications, orders and rulings by the FCC and/or state public utilities commission or other regulatory agency. Frontier reserves the right to suspend, modify or terminate any Service without liability where any statute, regulation and/or ruling, including modifications thereto, by any regulatory agency (including the FCC), legislative body or court of competent jurisdiction, (i) prohibits, restricts or otherwise prevents Frontier from furnishing such Service, or (ii) has a material negative impact on Frontier’s performance hereunder or the benefits provided by this FSA. If provision of any Service pursuant to this FSA is subject to advance approval of the FCC and/or any state public utilities commission, this FSA shall not become effective with respect to such Service until after receipt by Frontier of written notice of such approval.

15. Governing Law
This FSA shall be governed by and construed according to the laws of the State of California, without regard to its conflicts of laws provisions. Any related litigation may be brought in any State or Federal courts of the State of California, with venue in the County of Riverside. Customer and Frontier consent to personal jurisdiction in such courts.

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16. No Waiver
If either party fails, at any time, to enforce any right or remedy available to it under this FSA, that failure shall not be construed to be a waiver of the right or remedy with respect to any other breach or failure by the other party.

17. Severability
A declaration by any court, or other binding legal source, that any provision of this FSA or any Schedule is illegal and void, will not affect the legality and enforceability of any other provisions of this FSA, unless the provisions are mutually dependent.

18. Notice
All notices provided pursuant to this FSA will be in writing and delivered by registered or certified US Mail, postage prepaid, or by commercial overnight delivery service, or by facsimile, or by regular mail and shall be deemed delivered either on the date of return receipt acknowledgment (in the case of certified US Mail), or on the next day after the sending of the notice if sent overnight mail, or three (3) days after mailing if by regular mail to the address of the party designated to receive such notice.

19. Independent Relationship
Each party understands and agrees that it and its personnel are not employees of the other party, and that each party is an independent contractor hereunder for all purposes and at all times.

20. Dispute Resolution
Except as otherwise specifically provided in or permitted by this FSA, all disputes arising in connection with this FSA shall first be resolved through good faith negotiation. If, after negotiating in good faith for a period of ninety (90) calendar days or any agreed further period, the parties are unable to resolve the dispute, then each party may seek resolution by exercising any rights or remedies available at law or in equity. Customer and Frontier agree that each may only bring claims against the other in an individual capacity and not as a plaintiff or class member in any purported class, representative, or private attorney general proceeding.

21. Authorization and Entire Agreement
Each party represents that the person executing this FSA is authorized to enter into this FSA on its behalf. This FSA and any Schedules executed by the parties constitute the entire agreement between the parties pertaining to the subject matter herein and supersedes all prior oral and written proposals, correspondence and memoranda with respect thereto. This FSA may not be modified, amended or supplemented except by written agreement signed by an authorized representative of each party. Notwithstanding anything otherwise stated, a Customer purchase order document (whether signed by one or both parties) shall be construed solely as evidence of Customer’s internal business processes, and the terms and conditions contained thereon shall be void and of no effect or application toward this FSA.

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FRONTIER

SIGNATURE PAGE TO AGREEMENT BY AND BETWEEN THE CITY OF PALM SPRINGS AND FRONTIER COMMUNICATIONS OF AMERICA, INC.

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the dates stated below.

CONTRACTOR:

By: ______________________________________ By: _________________________________________ Signature Signature
(2nd signature required for Corporations)

Date: Date:

CITY OF PALM SPRINGS:

APPROVED BY CITY COUNCIL:

Date: _______ Item No.

APPROVED AS TO FORM: ATTEST:

By: ___________________________ By: _______________________________ City Attorney City Clerk

APPROVED:

By: _______________________________ Date:

City Manager – over $50,000
Deputy/Assistant City Manager – up to $50,000
Director – up to $25,000
Manager – up to $5,000

Item 1K - Page 10

CITY COUNCIL STAFF REPORT

DATE: MAY 9, 2024 BUSINESS & LEGISLATIVE

SUBJECT: F ISCAL YEAR 2022-23 MEASURE J AND SINGLE AUDIT REPORTS OF

THE CITY OF PALM SPRINGS

FROM: Scott C. Stiles, City Manager

BY: Department of Finance and Treasury

SUMMARY:

The certified public accounting firm of The Pun Group, LLC , completed the Measure J and Single Audit financial report of the City as of June 30, 2023.

RECOMMENDATION:

Receive and file the following Financial Audit Reports for fiscal year June 30, 2023:

• Measure J Fund Report Annual Financial Report
• Single Audit

STAFF ANALYSIS:

Based on the results of their audit, which was competed on December 31, 2023, The Pun Group provided the City with an unqualified opinion on the financial statements for the Measure J fund which means that the City’s financial statements are free of material misstatements and are in accordance with generally Accepted Accounting Principles (GAAP). The FY 2022-23 audited Measure J Financial Report is available as Attachment A.

A Single Audit is conducted when an entity has over $750,000 of federal awards in a single fiscal year. Based on the results of the single audit, The Pun Group presented two findings.

• 2023-001 Internal Control and Compliance over Year -End Closing, Bank Reconciliation, and Investment Reports.

• 2023-002 Reporting – Internal Control and Compliance over Reporting.

Item 3A - Page 1
City Council Staff Report
May 9, 2024 -- Page 2
FY 2022-23 Measure J and Single Audit Financial Reports of the City of Palm Springs

A thorough description of the finding and the “View of Responsible Officials” (this is the City’s response to the finding and the associated corrective action the City has given) can be found on pages 10-16 of the Single Audit Report (Attachment B).

The Measure J fund and the Single Audit can also be found on the City’s website at the following link:
(palmspringsca.gov)

ALIGNMENT WITH STRATEGIC PLANNING:

This item aligns with the City Council priorities of Quality of Life and Community Infrastructure.

FISCAL IMPACT:

None.

REVIEWED BY:

Department Director: Kristopher J. Mooney
City Manager: Scott Stiles

ATTACHMENTS:

A. Measure J Fund Report Annual Financial Report
B. Single Audit Report

Item 3A - Page 2

ATTACHMENT A

Item 3A - Page 3
Item 3A - Page 4
Measure J Capital Projects Fund
of the City of Palm Springs
Palm Springs, California
Financial Statements and
Independent Auditors' Reports
For the Year Ended June 30, 2023
fHE II PUNGR.OUP
AlC0ll'JT\1'.TS& AD\ l~OR5
Item 3A - Page 5
Measure J Capital Projects Fund of the City of Palm Springs For the Year Ended Jnne 30, 2023
Table of Contents

FINANCIAL SECTION
Independent Auditors' Report:

Report on the Audit of the Financial Statements .................................................................................................. I Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Stundards .......................................................................................... 5 Fund Fiuaucial Statements:

Balance Sheet ............................................................................................................................................................. 9 Statement of Revenues, Expenditures, and Change in Fund Balance ...................................................................... 10 Notes to the Financial Statements ............................................................................................................................ 13 Supplementa~ Infrrmation:

Schedule of Revenues, Expenditures, and Change in Fund Balance-Budget and Actual ..................................... 19 Item 3A - Page 6

INDEPENDENT AUDITORS' REPORT
To the Honorable Mayor and Members of the City Co uncil of the C ity of Palm Springs
Palm Spri ngs, California
Repor t on the Audit of the Financial Sta tements
Opinion
200 E. Sandpointe Avenue, Suite 600
Santa Ana, California 92707
www.pungroup.cpa ~
We have audit ed the a ccompan ying financ ial statements of the Measure J Capita l Project s Fund (the " Fund ") of the City of Palm Sprin gs (the "City "), which compri se the balance shee t as of Jun e 3 0, 2023, and the related statement of reve nues, expenditu res, and changes in fund balance for the year t hen ended, and the related notes to the fina ncial state ments.

In o ur opi nion, the financial statem ents referred to a bove present fairly, in all material respects, the financial position of the Fund as of June 30, 202 3, and the c hange in financ ial position fo r the yea r then ended in acco rdance with acco untin g princip les generally accep ted i n the U nited States of A merica.

Basis for Opinion
We condu cted our audit in accordance with audit ing standard s generally accep ted in the U nited State s of Ame rica ("GAAS ") and the s tandards applicable to financia l audits contained in Government Auditing Standards, issued by the Comptro ller Gener al of the United State s ("Government Auditing Standards''). Our responsibilit ies under those standards are further described in the Auditors ' Responsibilitie s for the Audit of the Financial Statements section of our report.

Emphasis of Matter
As discussed in ote I, the financial state ments present only the balan ce sheet and the state ment of reve nues, expe nditur es and change s in fund balance of the F und and d o not purport to, and do not present fairly the financia l position of the C ity as of Jun e 30, 2023 , the c hanges in its financial position, or, where a pplicable, its cash flows for the year then ended in acco rdance w ith acco unting princip les genera lly acce pted in the U nited States of America. Our opinion is not modified with respect to this matter.

Responsibiliti es of Management for the Financial Statements Manage ment is responsible for the preparation and fair presenta tion of these financial statements in acco rdance with acco untin g principles generally acce pted in the U nited States of America, and for the design, imp lementation, and mainte nance of internal cont rol relevant to the preparation and fair presentatio n of financial statements that are free from m aterial misstatemen t, whether due to fraud or error.

ORANGE COUNTY • SAN DIEGO • SACRAMENTO • WALNUT CREEK • LAS VEGAS • PHOENIX ooe Item 3A - Page 7
To the Honorable Mayor and Members of the City Council
of the City of Palm Springs
Palm Springs, California

Page 2 ends

Palm Springs City CouncilMay 9, 2024

Palm Springs City Council
May 9, 2024