M – Page 503 of 1107
22 ORDER WQ 2019-0005-DWQ March 20, 2019
FACILITY NAME1 GEOTRACKER . w
(AIRPORT ID) ." PROPERTY ADDRESS ' "t~ OWNER1
' ~ GLOBAL ID
SANTA BARBARA MUNI T10000012769 601 FIRESTONE RD CITY OF SANTA BARBARA (SBA) GOLETA, CA 93117 CITY HALL
SANTA BARBARA, CA 93101
SANTA MARIA PUB/CAPT G ALLAN T10000012770 3217 TERMINAL DR SANTA MARIA PUBLIC ARPT DIST HANCOCK FLO SANTA MARIA, CA 93455 3217 TERMINAL DR
(SMX) SANTA MARIA, CA 93455
BOB HOPE T10000012771 2627 HOLLYWOOD WAY BURBANK-GLENDALE-PASADENA ARPT (BUR) BURBANK, CA 91505 2627 HOLLYWOOD WAY
BURBANK, CA 91505
LONG BEACH /DAUGHERTY FIELD/ T10000012772 4100 DONALD DOUGLAS DR CITY OF LONG BEACH (LGB) LONG BEACH, CA 90808 CITY HALL 333 W. OCEAN
LONG BEACH, CA 90802
LOS ANGELES INTL T10000012773 ONE WORLD WAY CITY OF LOS ANGELES (LAX) LOS ANGELES, CA 90009 1 WORLD WAY BOX 92216
LOS ANGELES, CA 90009-2216
OXNARD T10000012774 2889 W 5TH ST COUNTY OF VENTURA
(OXR) OXNARD, CA 93030 555 AIRPORT WAY
CAMARILLO, CA 93010
CHICO MUNI T10000012788 150 Airpark Blvd CITY OF CHICO
(CIC) CHICO, CA 95927 PO BOX 3420
CHICO, CA 95927
FRESNO YOSEMITE INTL T10000012775 4995 E CLINTON WAY CITY OF FRESNO (FAT) FRESNO, CA 93727 4995 E CLINTON WAY
FRESNO, CA 93727
MEADOWS FIELD T10000012776 3701 WINGS WAY, #300 COUNTY OF KERN (BFL) BAKERSFIELD, CA 93308 DEPT OF ARPTS, 3701 WINGS WAY, #300, 3701 WINGS WAY, SUITE 300
BAKERS Fl ELD, CA 93308
SACRAMENTO INTL T10000012777 6900 AIRPORT BLVD COUNTY OF SACRAMENTO (SMF) SACRAMENTO, CA 95837 6900 AIRPORT BLVD
SACRAMENTO, CA 95837
M – Page 504 of 1107
23 ORDER WQ 2019-0005-DWQ
REDDING MUNI
(RDD)
MAMMOTH YOSEMITE
(MMH)
SOUTHERN CALIFORNIA
LOGISTICS
(VCV)
IMPERIAL COUNTY
(IPL)
PALM SPRINGS INTL
(PSP)
MCCLELLAN-PALOMAR
(CRQ)
SAN DIEGO INTL
(SAN)
PROPERTY ADDRESS ,
5000 S. AIRPORT WAY
ROOM 202
STOCKTON, CA 95206
T10000012779 I REDDING MUNI AIRPORT,
6751 WOODRUM CIRCLE
SUITE 200
REDDING, CA 96002
T10000012789 I 1300 Airport Road
MAMMOTH LAKES, CA
93546
T10000012780 I 18374 PHANTOM WEST
VICTORVILLE, CA 92394
T10000012781 I 1099 AIRPORT ROAD
IMPERIAL, CA 92251
T10000012782 I 3400 E. TAHQUITZ-CANYON
WAY, SUITE OFC
PALM SPRINGS, CA 92262
T10000012786 I 2192 PALOMAR AIRPORT
ROAD
CARLSBAD, CA 92011-4409
T10000012787 I 3225 N HARBOR DRIVE
SAN DIEGO, CA 92101-1022
OWNER1
COUNTY OF SAN JOAQUIN
5000 S AIRPORT WAY
STOCKTON, CA 95206
CITY OF REDDING
AIRPORTS DIVISION,
6751 WOODRUM CIRCLE, #200
REDDING, CA 96002-6071
TOWN OF MAMMOTH LAKES
1300 AIRPORT ROAD
MAMMOTH LAKES, CA 93546
760-934-3813
SOUTHERN CA LOGISTICS ARPT AUTH
18374 PHANTOM
VICTORVILLE, CA 92394
IMPERIAL COUNTY
1099 AIRPORT ROAD
IMPERIAL, CA 92251
CITY OF PALM SPRINGS
3400 E. TAHQUITZ CANYON WAY
PALM SPRINGS, CA 92262
COUNTY OF SAN DIEGO
1960 JOE CROSSON DRIVE
EL CAJON, CA 92020-1235
SAN DIEGO CNTY REG ARPT AUTHORITY
3225 N HARBOR DRIVE
SAN DIEGO, CA 92101-1022
March 20, 2019
1 Facility name and owner are those listed on the U.S. Department of Transportation Federal Aviation Administration Airport Master Record (FAA FORM 5010-1) and were obtained from https://www.gcrl.com/S010WEB/.
M – Page 505 of 1107
24 ORDER WQ 2019-0005-DWQ March 20, 2019
ATTACHMENT 2
TECHNICAL REPORT REQUIREMENTS AND QUESTIONNAIRE
FOR
AIRPORTS
WATER CODE SECTION 13267 ORDER FOR THE DETERMINATION OF THE
PRESENCE OF PER- AND POL YFLUOROALKYL SUBSTANCES
Contents:
A. Justification for the Need for Technical Reports
B. Technical Report Requirements
C. Airport Operator Questionnaire
A. JUSTIFICATION FOR THE NEED FOR TECHNICAL REPORTS
As indicated by the Federal Aviation Administration (FAA) 1, all Title 14, Code of Federal Regulations, Part 139 certified airports are required to provide aircraft rescue and firefighting services. Your facility has been ·certified by the FAA to use AFFF compounds. If AFFF or other PFAS compounds were disposed of, discharged to, spilled, or released in any way to lands of your facility, a work plan is required for the preliminary investigation of soil and groundwater impacts (Section B). The State Water Board seeks to determine whether the groundwater and/or soil at your location is impacted by PFAS and obtain a preliminary understanding of PFAS concentrations in the soil and/or groundwater at your facility.
The State Water Board intends to direct other dischargers identified as potential PFAS sources in the state to perform PFAS testing. The State Water Board and the Regional Water Boards will evaluate the data collected to make informed decisions in implementing appropriate regulatory action, in anticipation of emerging regulatory standards for PFAS.
B. TECHNICAL REPORT REQUIREMENTS
Work Plan
You are required to submit a work plan for a one-time preliminary site investigation of PFAS impacts at your facility to the Regional Water Board specified in the Order cover letter no later than 60 days following the date of this Order. This attachment provides specific requirements to include in the technical report. 1 https://www. faa.qov/airports/airport safety/part139 certi - 1 -
M –
25 ORDER WQ 2019-0005-DWQ March 20, 2019
At a minimum, provide the following in your work plan:
1. A site map with sample locations, PFAS material storage and use areas, probable release areas including firefighting training areas, crash sites, and spills from handling.
2. Identify sensitive receptors such as municipal supply wells, domestic wells, and/or surface water bodies within a one-mile radius of a suspected source area.
3. Proposed surface and subsurface soil sampling locations to delineate surficial and vertical extent of impacts where PFAS were applied to land.
4. Proposed representative groundwater sample locations in proximity to a suspected source area. Existing monitoring wells for your facility may be used if located in proximity to PFAS source(s) and groundwater samples would be representative of groundwater conditions. If groundwater gradient is unknown, at a minimum, three groundwater samples must be collected around the source area.
5. Sampling and Analysis Plan for compounds and parameters specified in Tables 1 and 2 that includes quality assurance and quality control procedures necessary to ensure valid and representative data is obtained and reported. Specify the appropriate sampling procedures, including sampling equipment, sampling containers, the quality of water used for blank preparation and equipment decontamination, sample holding times, and quantities for sampling PFAS compounds. To minimize contamination, all sampling materials, equipment, blanks, containers, and equipment decontamination reagents must be PFASfree, to the maximum extent practicable. Additional guidance for preventing sample contamination can be found at:
https://www.waterboards.ca.gov/water_issues/programs/pfas/.
6. Reporting limits for PFAS.
7. Signature, stamp, and contact information for the California-licensed Professional Geologist or Professional Engineer acting in responsible charge for the content of the Work Plan.
Final Report
A final sampling and analysis report, including at least the following information, must be submitted no later than 90 days following the State or Regional Water Board acceptance of the Work Plan:
a) A description of the sampling activities;
b) A summary table of analytical results;
- 2 -
M –
26 ORDER WQ 2019-0005-DWQ March 20, 2019
c) A copy of the Chain of Custody;
d) A copy of the field sampling log;
e) A copy of boring logs and any temporary/permanent monitoring well construction details
f) A copy of the site map showing the sampling/monitoring locations; and g) A copy of laboratory analytical results of the monitored media.
Questionnaire
If you 1) have not discharged, disposed of, spilled, or released in any way, AFFF or other PFAS containing materials to land at your facility, or 2) have already conducted sampling for these constituents in compliance with the minimum work plan requirements listed-below, please complete the questionnaire (Section C) with relevant information supporting your response and return to the Regional Water Board specified in the Order cover letter no later than 30 days following the date of this Order.
Report Submittal
Reports must be submitted in a searchable electronic format, with transmittal letter, text, tables, figures, laboratory analytical data, and appendices in Portable Document Format (PDF) format (one PDF for the entire report) as well as in electronic data deliverable (EDD) format. The Questionnaire, Work Plan, Final Report, and Analytical Reports and EDD must be uploaded into Geo Tracker via the Electronic Submittal of Information (ESI) Portal, as stipulated by California State law. GeoTracker ESI guidance, general information and Help Desk assistance can be on the ESI homepage at:
https://www.waterboards.ca.gov/water_issues/programs/ust/electronic_submittal/ The analytical laboratory must be accredited by the California Environmental Laboratory Accreditation Program (ELAP) to perform the analytical method for PFAS compliant with Department of Defense (DoD) Table B-15 of Quality Systems Manual (QSM). dated 2017, version 5.1 or later. The laboratory must have the capacity to quantify the target PFAS analytes listed in Table 1, and must be capable of achieving the quality control/quality assurance requirements specified in Table B-15 of the DoD QSM, version 5.1 or later. DoD's QSM version 5.1 can be found at:
https://www.denix.osd.mil/edqw/documents/documents/qsm-version-5-1-final/ as well as on the State Water Board's PFAS informational website:
https://www.waterboards.ca.gov/water_issues/programs/pfas/. A list of laboratories that are accredited by ELAP can be found on the State Water Board ELAP webpage:
https://www.waterboards.ca.gov/drinking_water/certlic/labs/. For the general parameters listed in Table 2, the method of analysis shall be appropriate for the expected concentrations.
- 3 -
M –
27 ORDER WQ 2019-0005-DWQ March 20, 2019
TABLE 1. PFAS Analytes Subject to Analysis
Chemical Name Abbreviation Chemical Abstracts Service (CAS) No. 2,3, 3, 3-Tetrafluoro-2-(heotafluorooroooxv)orooanoic acid HFPO-DA 13252-13~* 10:2 Fluorotelomer sulfonic acid 10:2 FTS ,120226-60-0* ,
,.
2,3,3,3-tetrafluoro-2-(1, 1,2,2,3,3,3-heptafluoropropoxy) propanoic Acid HFPA-Dk 13252-13-6 * ,
'Perfluorooctadecanoic acid PFOcDA 16517-t1-6*
, N-Ethyl perfluorooctane sulfonamidoethanol ,·-:- EtFOSE •' 1691,;.9~-2* T' -;~ Perfluorooctane sulfonic acid PFOS 1763-23-1 Perfluoroundecanoic acid PFUnDA 2058-94-8 N-Methyl perfluorooctane sulfonamidoacetic acid NMeFOSAA 2355-31-9 N-Methyl per:fluorooctane sulfonamidoethanol MeFOSE 24448-09-7* Perfluoropentanoiic Acid PFPeA 2706-90-3
Perfluoropentane sulfonoic acid PFPeS 2706-91-4
6:2 Fluorotelomer sulfonic acid 6:2 FTS 27619-97-2
N-Ethyl perfluorooctane sulfonamidoacetic acid NEtFOSAA 2991-50-6 Perfluorohexano(c acid PFHxA 307-24-4
1.0Perfluorododecanoic acid PFDoDA 307-55-1
N-Methyl perfluorooctane sulfonamide MeFOSA 31506-32-8* ) Perfluorooctanoic acid PFOA 335-67-1
Perfluorodecanoic acid PFDA 335-76-2
Perfluorodecane sulfonic acid PFDS 335-77-3
4,4,5,5,6,6,6-Heptafluorohexanoic Acid 3:3 FTCA 356-02-5* .. ',,
Perfluorohexane sulfonic acid PFHxS 355-46-4
Perfluorobutanoic acid PFBA 375-22-4
Perfluorobutane sulfonic acid PFBS 375-73-5
Perfluoroheptanoic acid PFHpA 375-85-9 Perfluoroheptane sulfonic acid PFHpS 375-92-8 Perfluorononanoic acid PFNA 375-95-1
Perfluorotetradecanoic acid PFTeDA 376-06-7
2H,2H;3H,3H-Perfluorodecanoic acid 7:3 FTCA 812-70-4*
8:2 Fluorotelomer sulfonic acid 8:2 FTS 39108-34-4
N-Ethyf perfluorooctane su'lfonamide ' - EtFOSA 4151-50-2* " Perfluorononane sulfonic acid PFNS 47 45·11-07-4 *
«
Perfluorohexadecanoic acid PFHxDA 67905-19-5*
~ -
Perfluorotridecanoic acid PFTrDA 72629-94-8
Perfluorooctanesulfonamide FOSA 754-91-6
4:2 Fluorotelomer sulfonic acid 4:2 FTS 757124-72-4
Perfluoro(2-((6-chlorohexvl)oxvlethanesulfonic acid) 9CI-PF30NS 756426-58-1 * 2-[(8-Chloro~1,1,2,2,3,3,4,4,5,5,6,6,7,7,8,8-hexadecafluorooctyl)oxy]- 11CI- 763051-92-9* 1, 1,2,2-tetrafluoroethanesulfonic' acid PF3OUdS
.2H,2H,3H,3H-Perfluorooctanoic'Acid (CAS 914637-49-3)
' '-! 5:3 FTCA 914637-49-3*
l,8-Dioxa~3H-oerfluorononanoic acid Adona 919005-14-4*
Note: Only the 23 analytes without the asterisk (*) are required to be analyzed as part of this Order. The analytes with the asterisk(*) are included in some but not all lists provided by accredited laboratories and are encouraged to be analyzed as part of this effort.
-4-
M –
28 ORDER WQ 2019-0005-DWQ March 20, 2019
TABLE 2
Field Parameters and General Chemistry for Groundwater
Parameter Units
Field Parameters
Depth to Groundwater Feet, bgs
Temperature Degrees C
Electrical Conductivity µmhos/cm
pH units
Turbidity NTU
General Chemistry
Total Dissolved Solids mg/L
Chloride mg/L
Carbonate mg/L
Bicarbonate mg/L
Nitrate-Nitrogen mg/L
Sulfate mg/L
Calcium mg/L
Magnesium mg/L
Potassium mg/L
Sodium mg/L
Notes:
bgs - below ground surface
C - Celsius
mg/L - milligrams
NTU - nephelometric turbidity units
µmhos/cm - micromhos per centimeter
- 5 -
M –
29 ORDER WQ 2019-0005-DWQ March 20, 2019
C. AIRPORT OPERATOR QUESTIONNAIRE
Operator/Principal Name: I Title: I
Name of Facility:
Facility's Address:
City/County/State/Zip:
Phone Number: I Fax: I
Email Address:
PER-AND PO~ Y-FL,UOROA[KYL SUBSTANCES (PFAS) • CONSTITUENT SCREENING , '" ' ' ' ' ' ,,, ' ' ' t "'
1. Have PFAS, including fire-fighting foams (i.e. Aqueous Film-Forming Foam DYES • NO [AFFF]), or any other PFAS compounds been used or stored at your facility? If yes, please attach additional sheets to describe where they were/are stored, handling processes utilized, and how long you have used/stored those PFAS at your facility.
2. Have PFAS been discharged, spilled, disposed of, released in any way, or applied DYES • NO to land at your facility?
3. If PFAS were discharged, spilled, disposed of, released in any way, or applied to DYES • NO land at your facility, have any investigations to identify the impacts of PFAS to soil and groundwater been conducted at your facility?
If yes, please attach additional sheets to describe where and when PFAS were discharged, spilled, disposed of, released in any way, or applied to land, the quantity, the method of analysis, a summary table of analytical results, as well as the laboratorv analvtical reoort.
- CERTIFICATION
- - ,,_ -,_ .. ,, ,,, ""
,.
' >< ' t -.
This form is only required to be completed if your facility did not discharge, spill, dispose, release in any way, or apply PFAS compounds to land, or you have already conducted sampling for PFAS compounds. This form and supporting documentation must be provided to the appropriate Regional Water Board and uploaded to GeoTracker by the date specified in the Order.
I, , certify under penalty of law that this document and all attachments were prepared by me, or under my direction or supervision, and the information submitted is, to the best of my knowledge and belief, true, accurate, and complete. I am aware that there are significant civil penalties for submitting false information.
Signature:
Title:
Date:
- 6 -
M –
30 State Water Resources Control Board
ATTACHMENT 3
Fact Sheet - Requirements for Submitting Technical Reports Under Section 13267 of the Water Code
What does it mean when the Regional Water Board
or the State Water Board (jointly referred to as the
Water Boards) require a technical report?
Section 132671 of the Water Code provides that" ... the regional board may require that any person who has
discharged, discharges, or who is suspected of having
discharged or discharging, or who proposes to
discharge waste .. .that could affect the quality of
waters ... shall furnish, under penalty of perjury, technical or monitoring program reports which the regional board
requires." Additionally, the state water board may carry out the authority granted to a regional board pursuant to Section 13267 if, after consulting with the regional
board, the state board determines that it will not
duplicate the efforts of the regional board.
This requirement for a technical report seems to
mean that I am guilty of something, or at least
responsible for cleaning something up. What if that
is not so?
The requirement for a technical report is a tool the
Water Boards use to investigate water quality issues or problems. The information provided can be used by the
Regional Water Board to clarify whether a given party
has responsibility.
Are there limits to what the Water Boards can ask
for?
Yes. The information required must relate to an actual
or suspected or proposed discharge of waste (including
discharges of waste where the initial discharge
occurred many years ago), and the burden of
compliance must bear a reasonable relationship to the
need for the report and the benefits obtained. The
Water Boards are required to explain the reasons for its request.
What if I can provide the information, but not by the
date specified?
A time extension may be given for good cause. Your
request should be promptly submitted in writing, giving reasons.
Are there penalties if I don't comply?
Depending on the situation, the Water Boards can
impose a fine of up to $5,000 per day, and a court can
impose fines of up to $25,000 per day as well as
criminal penalties. A person who submits false
information or fails to comply with a requirement to
submit a technical report may be found guilty of a
misdemeanor. For some reports, submission of false
information may be a felony.
Do I have to use a consultant or attorney to
comply?
There is no legal requirement for this, but as a practical matter, in most cases the specialized nature of the
information required makes use of a consultant and/or
attorney advisable.
If I have more questions, whom do I ask?
Requirements for technical reports include the name,
telephone number, and email address of the Regional
Water Board staff contact.
1 All code sections referenced herein can be found by going to www.leginfo.legislature.ca.gov.
E. J OAOUIN E~JUIVEI. CHt..+; J E 1t.f.f N s m~EC,i<, EXf.CtJT!•f~. l)!l'H:: CfOfi 100 i StrMt SacramMtc CA 9Sa -t l M ai i1 ng Andress· P.O. Boi. 10n. S11crnmt1nt-o . CA (Vl:li:?.-0100 l www .w;it~rt,oards.ca.gov M –
ATTACHMENT D
REGIONAL BOARD APPROVAL OF
SUPPLEMENTAL WORK PLAN
M – Page 513 of 1107
Water Boards
Colorado River Basin Regional Water Quality Control Board December 27, 2024
Mr. Joel Montalvo, MPA, PE
City Engineer
City of Palm Springs
3200 East Tahquitz Canyon Way
Palm Springs, CA 92262
[email protected]
-R-E�C�E�IVfliiE�tJ
QEC Q 7 Lu:.)
By• /1, A: .. +•••••··••"•••·• •... ttf�
SUBJECT: REVIEW OF SUPPLEMENTAL SITE INVESTIGATION WORK PLAN -
PER- AND POL YFLUOROALKYL SUBSTANCES GROUNDWATER
MONITORING, TESTING AND ANALYSIS PURSUANT TO CALIFORNIA WATER CODE SECTION 13267, AMENDMENT TO INVESTIGATIVE
ORDER WQ 2019-005-DWQ; FOR PALM SPRINGS AIRPORT
SITE: PALM SPRINGS INTERNATIONAL AIRPORT, PALM SPRINGS,
RIVERSIDE COUNTY, CALIFORNIA
GEOTRACKER GLOBAL I.D. NO. 10000012782
Dear Mr. Montalvo,
The California Regional Water Quality Control Board, Colorado River Basin Region (Regional Water Board) has reviewed the Supplemental Site Investigation Work Plan (Work Plan) prepared by RS&H California, Inc. (RS&H) on behalf of the City of Palm Springs (City}.
The City owns and operates the Palm Springs International Airport (PSP) located at 3400 East Tahquitz Canyon Way, in Palm Springs, California (Site - Figure 1 }. The Work Plan was prepared to delineate the extent of per- and polyfluoroalkyl substances (PFAS) in soil and groundwater at the Site.
On May 18, 2022, the United States Environmental Protection Agency (EPA) added five PFAS chemicals to the Regional Screening Level (RSL) list to help determine if response or remediation activities are needed. These PFAS chemicals were perfluorooctanoic acid (PFOA), perfluorooctanesulfonic acid (PFOS), Perfluorononanoic acid (PFNA}, Perfluorohexanesulfonic acid (PFHxS), and hexafluoropropylene oxide dimer acid (HFPODA also known as "GenX Chemicals"). Since then, additional PFAS chemicals have been added to the RSL list.
PETER SATIN, CHAIR I MICHAEL PLACENCIA, EXECUTIVE OFFICER 73-720 Fred Waring Orin, Suite 100, Palm Desert, CA 92260 I www.waterboards.ca.gov/coloradorlver
M – Page 514 of 1107
M –
M –
M –
M –
M –
M –
M –
M –
M –
CITY COUNCIL STAFF REPORT
DATE: MAY 27, 2026 CONSENT CALENDAR
SUBJECT: PURCHASE OF PROPERTY LOCATED AT 550 PASEO DOROTEA TO
SERVE AS AN ADMINISTRATION BUILDING FOR THE PALM SPRINGS
INTERNATIONAL AIRPORT
FROM: Scott C. Stiles, City Manager
BY: Department of Aviation
SUMMARY:
This item is to report on the purchase of real property located at 550 Paseo Dorotea, Palm Springs, to serve as an administration building for the Palm Springs International Airport (Airport).
RECOMMENDATION:
Receive and file report on the April 9, 2026, acquisition of real property located at 550 Paseo Dorotea (Property) to serve as an administration building for the Palm Springs International Airport.
STAFF ANALYSIS:
As Airport operations continue to expand, the administrative team has outgrown the current 8,665 square feet of space on the second floor of the terminal building.
Additionally, utilizing prime terminal real estate for administrative functions limits opportunities for revenue-generation and providing for passenger service needs. To accommodate both travelers and Airport staff, the Airport determined that acquiring an office building of approximately 10,000 square feet would provide a solution to both needs while providing the Airport opportunity to generate additional revenue.
The property is a single-story Class B office building constructed in 2007. It consists of 9,444 square feet on a 1.26-acre lot within the Desert Springs Professional Office Park.
The property is zoned P (Professional), which permits the Airport to use the building for administrative office space. An independent appraisal of the property was completed on November 21, 2025. The appraised value was $1,950,000.
On September 16, 2025, the Airport Commission recommended utilizing Measure D
N – Page 524 of 1107
City Council Staff Report
May 27, 2026 -- Page 2
Purchase of 550 Paseo Dorotea for Airport Administrative Offices Aviation Fuel Tax funds ($1,338,188) and Airport Fund Balance ($411,812) for the acquisition of 550 Paseo Dorotea. Subsequently, the City Council authorized staff during closed session to negotiate and execute a Purchase and Sale Agreement (PSA) with Paseo Dorotea Management, LLC, for the property.
On October 22, 2025, Airport staff presented to City Council in closed session the price and terms of a potential acquisition of the real property at 550 Paseo Dorotea for the purpose of administration office space for Airport staff. On February 11, 2026, Airport staff presented price and terms of that acquisition to City Council in closed session in accordance with the Brown Act.
On April 9, 2026, the City of Palm Springs closed on the purchase of 550 Paseo Dorotea for a total purchase amount of $1,780,335.88, inclusive of closing costs and other considerations (Attachment A).
FISCAL IMPACT:
The purchase of 550 Paseo Dorotea included the approved purchase price of $1,750,000 and closing costs and other considerations of $30,335.88. The closing costs included an escrow fee of $1,350 and $25 electronic service fee. The purchase required the proration of county taxes of $5,990.13 for the period of April 9, 2026 through July 1, 2026 and HOA Association Dues of $3,410.32 for the period of April 9, 2026 through May 1, 2026.
Upon closing, additional disbursements included May HOA Association Dues of $4,650.43 to Desert Springs Professional Office Park, professional service fees to CBRE of $2,450, project management services fee to Turner & Townsend Heery, LLC of $5,110 and pro forma fees of $7,350 to Turner & Townsend Inc. Capital expenses posted to Airport Account 4167056-80000. Future operating expenses will be budgeted to Airport Contractual Services Account 4157056-40105.
REVIEWED BY:
Interim Executive Director of Aviation: Victoria Carpenter City Attorney: Geremy Holm
City Manager: Scott Stiles
ATTACHMENTS:
A. Buyer’s Final Settlement Statement
N – Page 525 of 1107
ATTACHMENT A
BUYER'S FINAL SETTLEMENT STATEMENT
N – Page 526 of 1107
First American Title Company
74770 US Highway 111, Suite 101 •Indian Wells, CA 92210 Office Phone:(760)469-8888 Office Fax:
Buyer’s Final Settlement Statement
Property Address: 550 South Paseo Dorotea,
Palm Springs, CA 92264
File No: RIW-7355874
Officer: Dusty Garza/PS
Settlement Date: 04/09/2026
Disbursement Date: 04/09/2026
Print Date: 04/09/2026, 2:24 PM
Buyer: City of Palm Springs
Address: Attn: City Clerk , 3200 E Tahquitz Canyon Way, Palm Springs, CA 92262 Seller: Paseo Dorotea Management, LLC
Address: 1001 S CAPITAL OF TEXAS HIGHWAY, BUILDING M STE 100, Austin, TX 78746 Charge Description Buyer Charge Buyer Credit
Consideration:
Total Consideration 1,750,000.00
Deposits in Escrow:
Receipt No. 1195824089 on 01/07/2026 by City of Palm Springs 52,500.00 Receipt No. 1195824459 on 04/06/2026 by City of Palm Springs 1,769,011.88 Adjustments:
Seller Credit 10,000.00
Prorations:
County Taxes 04/09/26 to 07/01/26 @$13,149.07/semi 5,990.13 Association Dues 04/09/26 to 05/01/26 @$4,650.43/mo 3,410.32 Title/Escrow Charges to:
Escrow Fee - One Half to First American Title Company 1,350.00 Electronic Service Fee 25.00
Disbursements Paid:
Association Dues - May to Desert Springs Professional Office Park 4,650.43 Professional Fees to CBRE, Inc - Valuation and Advisory 2,450.00 Project Management Services Fee to Turner & Townsend Heery, LLC 5,110.00 Pro Forma to Turner & Townsend Inc. 7,350.00
Cash ( From) (X To) Buyer 51,176.00
Totals 1,831,511.88 1,831,511.88
N – Page 527 of 1107
CITY COUNCIL STAFF REPORT
DATE: MAY 27, 2026 CONSENT CALENDAR
SUBJECT: AWARD CONTRACT SERVICES AGREEMENT NO. 26B072 WITH
UNIVERSAL GREEN LLC FOR LANDSCAPE AND GROUNDS
MAINTENANCE SERVICES FOR CITY FACILITIES
FROM: Scott C. Stiles, City Manager
BY: David McAbee, Director of Public Works
SUMMARY:
This action will award a contract services agreement with Universal Green LLC for landscape and grounds maintenance services of City facilities in an amount not to exceed $733,550 for an initial three-year term.
RECOMMENDATION:
1. Award Contract Services Agreement No. 26B072 with Universal Green LLC to provide landscape and grounds maintenance services of City facilities in an amount not to exceed $733,550 for an initial three-year term commencing on July 1, 2026, and continuing through June 30, 2029, 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 in April 2026, Universal Green LLC is registered in the state of California.
BACKGROUND:
The City currently maintains a contract services agreement with Universal Green for landscape and grounds maintenance services of seventeen (17) City facilities and nineteen (19) airport zones. The agreement was originally approved by the City Council on June 5, 2023, for a three-year term beginning on July 1, 2023, and continuing through June 30, 2026, for an amount not to exceed $1,406,256.40.
O – Page 528 of 1107
City Council Staff Report
May 27, 2026 -- Page 2
Agreement No. 26B072 for Landscape and Grounds Maintenance Services Recently, as each joint contract that services both facilities within the Airport and Public Works has approached its end, each department has been soliciting and awarding separate contracts for needed services, allowing for direct management by each department.
The nineteen (19) airport zones previously included under the current Public Works agreement are not included in this contract. The Aviation Department is conducting a separate competitive procurement, with award anticipated to align with the July 1, 2026, start of the new fiscal year.
As the agreement is reaching the end of its term, this action will replace the existing contract through a competitive procurement conducted under an Invitation for Bids to ensure continuity in landscape and grounds maintenance services specific to City facilities.
Universal Green has performed satisfactorily during the current contract term. Staff have noted a reduction in complaints compared to the previous contractor, and the contractor has been responsive and accessible in addressing issues and service requests.
STAFF ANALYSIS:
On March 16, 2026, the Procurement and Contracting Department issued Invitation for Bids 26-06 (IFB 26-06) for landscape and grounds maintenance services based on the specifications provided by the Public Works Department. IFB 26-06 was advertised in the local newspaper, published on PlanetBids website with notification to 155 registered vendors. This outreach resulted in the submission of 7 bids.
The following contractors submitted bids for consideration by the April 15, 2026, deadline.
Vendor Location Bids
Universal Green LLC Desert Hot Springs, CA $733,550.00
Southwest Landscape & Maintenance, Inc. Indio, CA $1,279,463.00 New Generation Landscape Management,
Inc.
San Bernardino, CA $1,344,864.49
Mariposa Landscapes, Inc. Irwindale, CA $1,390,478.20
Orozco Landscape and Tree Co. Poma, CA $1,734,859.97
Conserve LandCare Indio, CA $2,947,558.92
GF Landscaping Hacienda Heights, CA $2,749,375.00
Landscape and grounds maintenance services include twenty-one (21) City facilities consisting of approximately 58 acres of total area including roughly 24 acres of landscaped areas, 3 acres of turf grass and 1,006 trees (including turf, desert and native landscaped areas).
Agreement 26B072 is for an initial three-year term with two optional one-year renewal
O – Page 529 of 1107
City Council Staff Report
May 27, 2026 -- Page 3
Agreement No. 26B072 for Landscape and Grounds Maintenance Services extensions. The unit pricing is fixed for the first year and will be adjusted annually on July 1 by the percentage change in the United States Bureau of Labor Statistics Employment Cost Index, and a corresponding blended percentage increase to the applicable State prevailing wage rates for “Landscape Maintenance Laborer” as detailed by the schedule of compensation.
Therefore, staff recommends approval of Contract Services Agreement 26B072 with Universal Green LLC, for landscape and grounds maintenance services of City facilities in an amount not to exceed $733,550, for the initial three-year term, with two one-year extension options at the City’s sole discretion.
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:
This item aligns with the following City Council Strategic Plan Broad Goal: Infrastructure and Facilities.
FISCAL IMPACT:
Funding is available in Fiscal Year 2026-27 and will be budgeted in subsequent fiscal years.
Public Works:
• 1006535-40105
• 1006540-40105
• 5206570-40105 & 50119
REVIEWED BY:
Assistant Director of Public Works: Daniel Martinez
Director of Public Works: David McAbee
Procurement and Contracting Manager: Tabitha Richards
Assistant City Manager: Teresa Gallavan
City Manager: Scott Stiles
O – Page 530 of 1107
City Council Staff Report
May 27, 2026 -- Page 4
Agreement No. 26B072 for Landscape and Grounds Maintenance Services ATTACHMENTS:
A. Contract Services Agreement 26B072
B. Public Integrity Disclosure Form
O – Page 531 of 1107
ATTACHMENT “A”
Universal Green Landscape and Grounds
Agreement 26B072
O – Page 532 of 1107
(BB&K 2024) 1
CONTRACT SERVICES AGREEMENT 26B072
LANDSCAPE AND GROUNDS MAINTENANCE
SERVICES CITY FACILITIES
This Contract Services Agreement (“Agreement”) is made and entered into this 1st day of July 2026, (“Effective Date”), by and between the City of Palm Springs, a California charter city and municipal corporation (“City”), and Universal Green LLC, a California limited liability company, (“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 landscape and grounds maintenance services for city facilities, (“Project”).
B. Contractor has submitted to City a Bid to provide landscape and grounds maintenance services for city facilities, to City under the terms of this Agreement.
C. Contractor is qualified by virtue of its experience, training, education, reputation, and expertise to provide these services and has agreed to provide such services as provided in this Agreement.
D. City desires to retain Contractor to provide such contract services.
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. SERVICES OF CONTRACTOR
1.1 Scope of Services. In compliance with all terms and conditions of this Agreement, Contractor agrees to perform the contract services set forth in the Scope of Services described in Exhibit “A” (the “Services” or “Work”), which is attached and incorporated herein by this reference. As a material inducement to the City entering into this Agreement, Contractor represents and warrants that Contractor is a provider of first class work and contract services and that Contractor is experienced in performing the Work contemplated and, in light of such status and experience, Contractor covenants that it shall perform the the Work 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.
1.2 Contract Documents.
The Agreement between the Parties shall consist of the following: (1) this Agreement; (2) the Scope of Services; (3) the City’s Request for Proposals; and, (4) the Contractor’s signed, original proposal submitted to the City (“Contractor’s Proposal”), (collectively referred to as the “Contract Documents”). The City’s Invitation for Bids and the Contractor’s Bid, which are both attached as Exhibits “A” is incorporated herein by this reference and are made a part of this Agreement. The Scope of Services shall include the Contractor’s Bid. All provisions of the Scope of Services, the
O – Page 533 of 1107
(BB&K 2024) 2
City’s Invitation for Bids and the Contractor’s Bid shall be binding on the Parties. Should any conflict or inconsistency exist in the Contract Documents, the conflict or inconsistency shall be resolved by applying the provisions in the highest priority document, which shall be determined in the following order of priority: (1st) the provisions of the Scope of Services (Exhibit “A”); (2nd) the provisions of the City’s Invitation for Bids; (3rd) the terms of this Agreement; and, (4th) the provisions of the Contractor’s Bid.
1.3 Compliance with Law. Contractor warrants that all Services rendered shall be performed in accordance with all applicable federal, state, and local laws, statutes, ordinances lawful orders, rules, and regulations. Contractor shall be liable for all violations of such laws and regulations in connection with the Services and this Agreement.
1.4 Licenses, Permits, Fees, and Assessments. Contractor represents and warrants to City that it has obtained all licenses, permits, qualifications, and approvals of whatever nature that are legally required to practice its profession and perform the Work and Services required by this Agreement. Contractor represents and warrants to City that Contractor shall, at its sole cost and expense, keep in effect at all times during the term of this Agreement, any license, permit, qualification, or approval that is legally required for Contractor to perform the Work and Services under this Agreement.
1.5 Familiarity with Work. By executing this Agreement, Contractor warrants that Contractor (a) has thoroughly investigated and considered the Scope of Services to be performed, (b) has carefully considered how the Services should be performed, and (c) fully understands the facilities, difficulties, and restrictions attending performance of the Services under this Agreement.
If the Services involve work upon any site, Contractor warrants that Contractor has or will investigate the site and is or will be fully acquainted with the conditions there existing, prior to commencement of any Services. Should the Contractor discover any latent or unknown conditions that will materially affect the performance of the Services, Contractor shall immediately inform the City of such fact and shall not proceed except at Contractor's risk until written instructions are received from the City.
2. COMPENSATION
2.1 Maximum Contract Amount. For the Services rendered under this Agreement, Contractor shall be compensated by City in accordance with the Schedule of Compensation, which is attached as Exhibit “B” and incorporated in this Agreement by reference. Compensation shall not exceed the maximum contract amount of Seven Hundred Thirty-Three Thousand Five Hundred Fifty Dollars and Zero Cents ($733,550.00) ("Maximum Contract Amount"), except as may be provided under Section 2.3. The method of compensation shall be as set forth in Exhibit “B.” Compensation for necessary expenditures must be approved in advance by the Contract Officer designated under Section 4.2. The Maximum Contract Amount shall include the attendance of Contractor at all Project meetings reasonably deemed necessary by the City.
Contractor shall not be entitled to any increase in the Maximum Contract Amount for attending these meetings.
2.2. Method of Payment. Unless another method of payment is specified in the Schedule of Compensation (Exhibit “B”), in any month in which Contractor wishes to receive payment, Contractor shall submit to the City an invoice for services rendered prior to the date of the invoice. The invoice shall be in a form approved by the City’s Finance Director and must be submitted no later than the tenth (10) working day of such month. Such requests shall be based
O – Page 534 of 1107
(BB&K 2024) 3
upon the amount and value of the services performed by Contractor and accompanied by such reporting data including an itemized breakdown of all costs incurred and tasks performed during the period covered by the invoice, as may be required by the City. City shall use reasonable efforts to make payments to Contractor within forty-five (45) days after receipt of the invoice or as soon as is reasonably practical. There shall be a maximum of one payment per month.
2.3 Changes in Scope. In the event any change or changes in the Scope of 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.
2.4 Appropriations. This Agreement is subject to and contingent upon funds being appropriated by the City Council for each fiscal year covered by the Agreement. If such appropriations are not made, this Agreement shall automatically terminate without penalty to the City.
3. SCHEDULE OF PERFORMANCE
3.1 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 the July 1, 2026, and ending on June 30, 2029 The Parties may mutually extend the term of this Agreement for up to two additional one-year periods (“Option Period(s)”), provided, the Parties do so in writing prior to the expiration of the original term of the then-current Option Period.
3.2 Termination Prior to Expiration of Term. The 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. Contractor may not terminate this Agreement except for cause, upon thirty (30) days written notice to City.
3.3 Schedule of Performance. Contractor shall commence the Services under this Agreement upon receipt of a written notice to proceed and shall perform all Services within the time period(s) established in the Schedule of Performance. When requested by Contractor, extensions to the time period(s) specified in the Schedule of Performance may be approved in writing by the Contract Officer, but such extensions shall not exceed one hundred eighty (180) days cumulatively; however, the City shall not be obligated to grant such an extension.
O – Page 535 of 1107
(BB&K 2024) 4
3.4 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, 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. COORDINATION OF WORK
4.1 Representative of Contractor. The following principal of Contractor is designated as being the principal and representative of Contractor authorized to act in its behalf and make all decisions with respect to the Services to be performed under this Agreement:
Salvador Moreno-Ramos, Member. It is expressly understood that the experience, knowledge, education, capability, expertise, 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 performed hereunder. The foregoing principal may not be changed by Contractor without prior written approval of the Contract Officer.
4.2 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.
4.3 Prohibition Against Subcontracting or Assignments. 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 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. All persons engaged
O – Page 536 of 1107
(BB&K 2024) 5
in the Work will be considered employees of Contractor. City will deal directly with and will make all payments to Contractor. In addition, neither this Agreement nor any interest in this Agreement may be transferred, assigned, conveyed, hypothecated, or encumbered voluntarily or by operation of law, whether for the benefit of creditors or otherwise, without the prior written consent of City. In the event of any such unapproved transfer, including any bankruptcy proceeding, this Agreement shall be void. No approved transfer shall release Contractor or any surety of Contractor from any liability under this Agreement without the express written consent of City.
4.4 Independent Contractor. The legal relationship between the Parties is that of an independent contractor, and nothing shall be deemed to make Contractor a City employee.
A. During the performance of this Agreement, Contractor and its officers, employees, and agents shall act in an independent capacity and shall not act or represent themselves as City officers or employees. The personnel performing the Services under this Agreement on behalf of Contractor shall at all times be under Contractor’s exclusive direction and control. Neither City nor any of its officers, employees, or agents shall have control over the conduct of Contractor or any of its officers, employees, or agents, except as set forth in this Agreement. Contractor, its officers, employees, or agents shall not maintain an office or any other type of fixed business location at City’s offices. City shall have no voice in the selection, discharge, supervision, or control of Contractor’s employees, servants, representatives, or agents, or in fixing their number, compensation, or hours of service. Contractor shall pay all wages, salaries, and other amounts due its employees in connection with this Agreement and shall be responsible for all reports and obligations respecting them, including but not limited to social security income tax withholding, unemployment compensation, workers’ compensation, and other similar matters. City shall not in any way or for any purpose be deemed to be a partner of Contractor in its business or otherwise a joint venturer or a member of any joint enterprise with Contractor.
B. Contractor shall not have any authority to bind City in any manner. This includes the power to incur any debt, obligation, or liability against City.
C. No City benefits shall be available to Contractor, its officers, employees, or agents in connection with any performance under this Agreement. Except for contract fees paid to Contractor as provided for in this Agreement, City shall not pay salaries, wages, or other compensation to Contractor for the performance of Services under this Agreement. City shall not be liable for compensation or indemnification to Contractor, its officers, employees, or agents, for injury or sickness arising out of performing Services. If for any reason any court or governmental agency determines that the City has financial obligations, other than under Section 2 and Subsection 1.8 in this Agreement, of any nature relating to salary, taxes, or benefits of Contractor’s officers, employees, servants, representatives, subcontractors, or agents, Contractor shall indemnify City for all such financial obligations.
4.5 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
O – Page 537 of 1107
(BB&K 2024) 6
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.
5. INSURANCE
5.1 Types of Insurance. Contractor shall procure and maintain, at its sole cost and expense, the insurance described herein. The insurance shall be for the duration of this Agreement and includes any extensions, unless otherwise specified in this Agreement. The insurance shall be procured in a form and content satisfactory to City. The insurance shall apply against claims which may arise from the Contractor's performance of Work under this Agreement, including Contractor's agents, representatives, or employees. In the event the City Manager determines that the Work or Services to be performed under this Agreement creates an increased or decreased risk of loss to the City, the Contractor agrees that the minimum limits of the insurance policies may be changed accordingly upon receipt of written notice from the City Manager or his designee. Contractor shall immediately substitute any insurer whose A.M. Best rating drops below the levels specified in this Agreement. Except as otherwise authorized below for contract liability (errors and omissions) insurance, all insurance provided under this Agreement shall be on an occurrence basis. The minimum amount of insurance required shall be as follows:
A. Errors and Omissions Insurance. Contractor shall obtain and maintain in full force and effect throughout the term of this Agreement, standard industry form contract liability (errors and omissions) insurance coverage in an amount of not less than one million dollars ($1,000,000.00) per occurrence and two-million dollars ($2,000,000.00) annual aggregate, in accordance with the provisions of this section.
required
X is not required;
(1) Contractor shall either: (a) certify in writing to the City that Contractor is unaware of any contract liability claims made against Contractor and is unaware of any facts which may lead to such a claim against Contractor; or (b) if Contractor does not provide the certification under (a), Contractor shall procure from the contract liability insurer an endorsement providing that the required limits of the policy shall apply separately to claims arising from errors
O – Page 538 of 1107
(BB&K 2024) 7
and omissions in the rendition of services under this Agreement. (2) If the policy of insurance is written on a “claims made” basis, the policy shall be continued in full force and effect at all times during the term of this Agreement, and for a period of three (3) years from the date of the completion of the Services provided hereunder. In the event of termination of the policy during this period, Contractor shall obtain continuing insurance coverage for the prior acts or omissions of Contractor during the course of performing Services under the terms of this Agreement. The coverage shall be evidenced by either a new policy evidencing no gap in coverage, or by obtaining separate extended “tail” coverage with the present or new carrier or other insurance arrangements providing for complete coverage, either of which shall be subject to the written approval by the City Manager. (3) In the event the policy of insurance is written on an “occurrence” basis, the policy shall be continued in full force and effect during the term of this Agreement, or until completion of the Services provided for in this Agreement, whichever is later. In the event of termination of the policy during this period, new coverage shall immediately be obtained to ensure coverage during the entire course of performing the Services under the terms of this Agreement.
B. Workers’ Compensation Insurance. Contractor shall obtain and maintain, in full force and effect throughout the term of this Agreement, workers’ compensation insurance in at least the minimum statutory amounts, and in compliance with all other statutory requirements, as required by the State of California. Contractor agrees to waive and obtain endorsements from its workers’ compensation insurer waiving subrogation rights under its workers’ compensation insurance policy against the City and to require each of its subcontractors, if any, to do likewise under their workers’ compensation insurance policies. If Contractor has no employees, Contractor shall complete the City’s Request for Waiver of Workers’ Compensation Insurance Requirement form.
C. Commercial General Liability Insurance. Contractor shall obtain and maintain, in full force and effect throughout the term of this Agreement, a policy of commercial general liability insurance written on a per occurrence basis with a combined single limit of at least one million dollars ($1,000,000.00) and two million dollars ($2,000,000.00) general aggregate for bodily injury and property damage including coverages for contractual liability, personal injury, independent contractors, broad form property damage, products and completed operations.
D. Business Automobile Insurance. Contractor shall obtain and maintain, in full force and effect throughout the term of this Agreement, a policy of business automobile liability insurance written on a per occurrence basis with a single limit liability in the amount of one million dollars ($1,000,000.00) bodily injury and property damage. The policy shall include coverage for owned, non-owned, leased, and hired cars.
E. Employer Liability Insurance. Contractor shall obtain and maintain, in full force and effect throughout the term of this Agreement, a policy of employer liability insurance written on a per occurrence basis with a policy limit of at least one million dollars ($1,000,000.00) for bodily injury or disease.
5.2 Deductibles and Self-Insured Retentions. Any deductibles or self-insured retentions must be declared to and approved by the City Manager or his/her designee prior to commencing any work or services under this Agreement. Contractor guarantees payment of all deductibles and self-insured retentions. City reserves the right to reject deductibles or selfinsured retentions in excess of $10,000, and the City Manager or his/her designee may require
O – Page 539 of 1107
(BB&K 2024) 8
evidence of pending claims and claims history as well as evidence of Contractor’s ability to pay claims for all deductible amounts and self-insured retentions proposed in excess of $10,000.
5.3 Other Insurance Requirements. The following provisions shall apply to the insurance policies required of Contractor under this Agreement:
A. For any claims related to this Agreement, Contractor’s coverage shall be primary insurance with respect to the City and its officers, council members, officials, employees, agents, and volunteers. Any insurance or self-insurance maintained by the City and its officers, council members, officials, employees, agents, and volunteers shall be in excess of Contractor’s insurance and shall not contribute with it.
B. Any failure to comply with reporting or other provisions of the policies, including breaches of warranties, shall not affect coverage provided to City and its officers, council members, officials, employees, agents, and volunteers.
C. All insurance coverage and limits provided by Contractor and available or applicable to this Agreement are intended to apply to each insured, including additional insureds, against whom a claim is made or suit is brought to the full extent of the policies. Nothing contained in this Agreement or any other agreement relating to the City or its operations shall limit the application of such insurance coverage.
D. No required insurance coverages may include any limiting endorsement which substantially impairs the coverages set forth in this Agreement (e.g., elimination of contractual liability or reduction of discovery period), unless the endorsement has first been submitted to the City Manager and approved in writing.
E. Contractor agrees to require its insurer to modify insurance endorsements to delete any exculpatory wording stating that failure of the insurer to mail written notice of cancellation imposes no obligation, or that any party will "endeavor" (as opposed to being required) to comply with the requirements of the endorsements. Certificates of insurance will not be accepted in lieu of required endorsements, and submittal of certificates without required endorsements may delay commencement of the Project. It is Contractor’s obligation to ensure timely compliance with all insurance submittal requirements as provided in this Agreement.
F. Contractor agrees to ensure that subcontractors, and any other parties involved with the Project who are brought onto or involved in the Project by Contractor, provide the same minimum insurance coverage required of Contractor. Contractor agrees to monitor and review all such coverage and assumes all responsibility for ensuring that such coverage is provided in conformity with the requirements of this section. Contractor agrees that upon request, all agreements with subcontractors and others engaged in the Project will be submitted to the City for review.
G. Contractor acknowledges and agrees that any actual or alleged failure on the part of the City to inform Contractor of non-compliance with any insurance requirement in no way imposes any additional obligations on the City nor does it waive any rights in this or any other regard.
H. Contractor shall provide proof that policies of insurance required in this Agreement, expiring during the term of this Agreement, have been renewed or replaced with other policies providing at least the same coverage. Proof that such coverage has been ordered shall
O – Page 540 of 1107
(BB&K 2024) 9
be submitted prior to expiration. Endorsements as required in this Agreement applicable to the renewing or new coverage shall be provided to City no later than ten (10) days prior to expiration of the lapsing coverage.
I. Requirements of specific insurance coverage features or limits contained in this section are not intended as limitations on coverage, limits, or other requirements, or as a waiver of any coverage normally provided by any given policy. Specific reference to a given coverage feature is for purposes of clarification only as it pertains to a given issue, and is not intended by any party or insured to be limiting or all-inclusive.
J. The requirements in this section supersede all other sections and provisions of this Agreement to the extent that any other section or provision conflicts with or impair the provisions of this section.
K. Contractor agrees to provide immediate notice to City of any claim or loss against Contractor arising out of the Work performed under this Agreement and for any other claim or loss which may reduce the insurance available to pay claims arising out of this Agreement. City assumes no obligation or liability by such notice, but has the right (but not the duty) to monitor the handling of any such claim or claims if they are likely to involve City, or to reduce or dilute insurance available for payment of potential claims.
L. Contractor agrees that the provisions of this section shall not be construed as limiting in any way the extent to which the Contractor may be held responsible for the payment of damages resulting from the Contractor’s activities or the activities of any person or person for which the Contractor is otherwise responsible.
5.4 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 such requirements are waived in writing by the City Manager or his designee due to unique circumstances.
5.5 Verification of Coverage. Contractor shall furnish City with both certificates of insurance and endorsements, including additional insured endorsements, affecting 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).
O – Page 541 of 1107
(BB&K 2024) 10
B. "This insurance is primary and non-contributory over any insurance or selfinsurance 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.
6. INDEMNIFICATION
6.1 Indemnification and Reimbursement. 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.
6.2 Design Contract 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
O – Page 542 of 1107
(BB&K 2024) 11
claim, including the cost to defend, shall not exceed the Contractor’s proportionate percentage of fault.
7. REPORTS AND RECORDS
7.1 Accounting 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 to 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.
7.2 Reports. Contractor shall periodically prepare and submit to the Contract Officer such reports concerning the performance of the Services required by this Agreement, or as the Contract Officer shall require. Contractor acknowledges that the City is greatly concerned about the cost of the Work to be performed under this Agreement. For this reason, Contractor agrees that Contractor shall promptly notify the Contract Officer the estimated increased or decreased cost if Contractor becomes aware of any facts, circumstances, techniques, or events that may or will materially increase or decrease the cost of the Services. If Contractor is providing design services, Contractor shall promptly notify the Contract Officer the estimated increased or decreased cost for the project being designed if Contractor becomes aware of any facts, circumstances, techniques, or events that may or will materially increase or decrease the cost of the design services.
7.3 Ownership of Documents. All drawings, specifications, reports, records, documents, memoranda, correspondence, computations, and other materials prepared by Contractor, its employees, subcontractors, and agents in the performance of this Agreement shall be the property of City and shall be promptly delivered 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 of ownership of the documents and materials. Any use of such completed documents for other projects and/or use of incomplete documents without specific written authorization by the Contractor will be at the City's sole risk and without liability to Contractor, and the City shall indemnify the Contractor for all resulting damages. Contractor may retain copies of such documents for their own use.
Contractor shall have an unrestricted right to use the concepts embodied tin this Agreement.
Contractor shall ensure that all its subcontractors shall provide for assignment to City of any documents or materials prepared by them. In the event Contractor fails to secure such assignment, Contractor shall indemnify City for all resulting damages.
7.4 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.
All information gained by Contractor in the performance of this Agreement shall be considered confidential and shall not be released by Contractor without City’s prior written authorization.
7.5 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
O – Page 543 of 1107
(BB&K 2024) 12
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.
8. ENFORCEMENT OF AGREEMENT
8.1 California Law and Venue. This Agreement shall be construed and interpreted both as to validity and as 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.
8.2 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.
8.3 Default of Contractor. Contractor’s failure to comply with any provision of this Agreement shall constitute a default.
A. If the City Manager, or his designee, determines that Contractor is in default in the performance of any of the terms or conditions of this Agreement, he/she shall notify Contractor in writing of such default. Contractor shall have ten (10) days, or such longer period as City may designate, to cure the default by rendering satisfactory performance. In the event Contractor fails to cure its default within such period of time, City shall have the right, notwithstanding any other provision of this Agreement, to terminate this Agreement without further notice and without prejudice of any remedy to which City may be entitled at law, in equity, or under this Agreement. Contractor shall be liable for all reasonable costs incurred by City as a result of such default. Compliance with the provisions of this section shall not constitute a waiver of any City right to take legal action in the event that the dispute is not cured, provided that nothing shall limit City’s right to terminate this Agreement without cause under Section 3.2.
B. If termination is due to the failure of the Contractor to fulfill its obligations under this Agreement, City may, after compliance with the provisions of Section 8.3(A), take over the work and prosecute the same to completion by contract or otherwise. The Contractor shall be liable to the extent that the total cost for completion of the Services required hereunder exceeds the Maximum Contract Amount (provided that the City shall use reasonable efforts to mitigate such damages). The City may withhold any payments to the Contractor for the purpose of set-off or partial payment of the amounts owed the City as previously stated. The withholding or failure to withhold payments to Contractor shall not limit Contractor’s liability for completion of the Services as provided in this Agreement.
8.4 Waiver. No waiver of any provision of this Agreement shall be effective unless in writing and signed by a duly authorized representative of the Party against whom enforcement of a waiver is sought. Any waiver by the Parties of any default or breach of any covenant, condition,
O – Page 544 of 1107
(BB&K 2024) 13
or term contained in this Agreement, shall not be construed to be a waiver of any subsequent or other default or breach, nor shall failure by the Parties to require exact, full, and complete compliance with any of the covenants, conditions, or terms contained in this Agreement be construed as changing the terms of this Agreement in any manner or preventing the Parties from enforcing the full provisions.
8.5 Rights and Remedies 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 and 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.
8.6 Legal Action. In addition to any other rights or remedies, either Party may take legal action, in law or in equity, to cure, correct, remedy or recover damages for any default, to compel specific performance of this Agreement, to obtain declaratory or injunctive relief, or to obtain any other remedy consistent with the purposes of this Agreement.
8.7 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 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.
9. CITY OFFICERS AND EMPLOYEES: NON-DISCRIMINATION
9.1 Non-liability of City Officers and Employees. No officer or employee of the City shall be personally liable to the Contractor, or any successor-in-interest, in the event of any default or breach by the City or for any amount which may become due to the Contractor or to its successor, or for breach of any obligation of the terms of this Agreement.
9.2 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.
9.3 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
O – Page 545 of 1107
(BB&K 2024) 14
with the provisions of Palm Springs Municipal Code Section 7.05.02, including without limitation the provision of benefits, relating to non-discrimination in city contracting.
10. MISCELLANEOUS PROVISIONS
10.1 Patent and Copyright Infringement.
To the fullest extent permissible under law, and in lieu of any other warranty by City or Contractor against patent or copyright infringement, statutory or otherwise:
A. It is agreed that Contractor shall defend at its expense any claim or suit against City on account of any allegation that any item furnished under this Agreement, or the normal use or sale arising out of the performance of this Agreement, infringes upon any presently existing U.S. letters patent or copyright and Contractor shall pay all costs and damages finally awarded in any such suit or claim, provided that Contractor is promptly notified in writing of the suit or claim and given authority, information and assistance at Contractor’s expense for the defense of same, and provided such suit or claim arises out of, pertains to, or is related to the negligence, recklessness or willful misconduct of Contractor. However, Contractor will not indemnify City if the suit or claim results from: (1) City's alteration of a deliverable, such that City’s alteration of such deliverable created the infringement upon any presently existing U.S. letters patent or copyright; or (2) the use of a deliverable in combination with other material not provided by Contractor when it is such use in combination which infringes upon an existing U.S. letters patent or copyright.
B. Contractor shall have sole control of the defense of any such claim or suit and all negotiations for settlement in the event City fails to cooperate in the defense of any suit or claim, provided, however, that such defense shall be at Contractor’s expense. Contractor shall not be obligated to indemnify City under any settlement that is made without Contractor’s consent, which shall not be unreasonably withheld. If the use or sale of such item is enjoined as a result of the suit or claim, Contractor, at no expense to City, shall obtain for City the right to use and sell the item, or shall substitute an equivalent item acceptable to City and extend this patent and copyright indemnity thereto.
10.2 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.
All notices shall be personally delivered, sent by pre-paid First Class U.S. Mail, registered or certified mail, postage prepaid, return receipt requested, or delivered or sent by facsimile with attached evidence of completed transmission. All notices shall be deemed received upon the earlier of (i) the date of delivery to the address of the person to receive such notice if delivered personally or by messenger or overnight courier; (ii) five (5) business days after the date of posting by the United States Post Office if by mail; or (iii) when sent if given by facsimile. Any notice, request, demand, direction, or other communication sent by facsimile must be confirmed within forty-eight (48) hours by letter mailed or delivered. Other forms of electronic transmission such as e-mails, text messages, and instant messages are not acceptable manners of notice required hereunder. Notices or other communications shall be addressed as follows:
To City: City of Palm Springs
Attention: City Manager & City Clerk
3200 E. Tahquitz Canyon Way
Palm springs, California 92262
Telephone: (760) 323-8204
Facsimile: (760) 323-8332
O – Page 546 of 1107
(BB&K 2024) 15
To Contractor: Universal Green LLC
Attention: Salvador Moreno-Ramos
17989 Corkill Rd 63
Desert Hot Springs, CA 92241
10.3 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.
10.4 Amendment. No amendments or other modifications of this Agreement shall be binding unless through written agreement signed by all Parties.
10.5 Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law. If any provision of this Agreement shall be determined to be invalid by a final judgment or decree of a court of competent jurisdiction, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the reminder of that provision, or the remaining provisions of this Agreement unless the invalid provision is so material that its invalidity deprives either Party of the basic benefit of their bargain or renders this Agreement meaningless.
10.5 Successors in Interest. This Agreement shall be binding upon and inure to the benefit of the Parties’ successors and assignees.
10.6 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.
10.7 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.
10.8. Corporate Authority. Each of the undersigned represents and warrants that (i) the Party for which he or she is executing this Agreement is duly authorized and existing, (ii) he or she is duly authorized to execute and deliver this Agreement on behalf of the Party for which he or she is signing, (iii) by so executing this Agreement, the Party for which he or she is signing is formally bound to the provisions of this Agreement, and (iv) the entering into this Agreement does not violate any provision of any other Agreement to which the Party for which he or she is signing is bound.
10.9 Counterparts. This Agreement may be signed in counterparts, each of which shall constitute an original.
10.10 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
O – Page 547 of 1107
(BB&K 2024) 16
reference. Consultant shall also require any subconsultants to comply with the Russian Sanctions Program and certify compliance pursuant to this Section.
10.11. BOND REQUIREMENTS.
10.11.1 Payment Bond. If required by law or otherwise specifically requested by City in Exhibit “D” attached hereto and incorporated herein by reference, Contractor shall execute and provide to City concurrently with this Contract a Payment Bond in an amount required by the City and in a form provided or approved by the City. If such bond is required, no payment will be made to Contractor until the bond has been received and approved by the City.
10.11.2 Performance Bond. If specifically requested by City in Exhibit “D” attached hereto and incorporated herein by reference, Contractor shall execute and provide to City concurrently with this Contract a Performance Bond in an amount required by the City and in a form provided or approved by the City. If such bond is required, no payment will be made to Contractor until the bond has been received and approved by the City.
10.11.3 Bond Provisions. Should, in City’s sole opinion, any bond become insufficient or any surety be found to be unsatisfactory, Contractor shall renew or replace the effected bond within (ten) 10 days of receiving notice from City. In the event the surety or Contractor intends to reduce or cancel any required bond, at least thirty (30) days prior written notice shall be given to the City, and Contractor shall post acceptable replacement bonds at least ten (10) days prior to expiration of the original bonds. No further payments shall be deemed due or will be made under this Contract until any replacement bonds required by this Section are accepted by the City. To the extent, if any, that the Total Contract Price is increased in accordance with the Contract, Contractor shall, upon request of the City, cause the amount of the bond to be increased accordingly and shall promptly deliver satisfactory evidence of such increase to the City. If Contractor fails to furnish any required bond, the City may terminate the Contract for cause.
10.11.4 Surety Qualifications. Only bonds executed by an admitted surety insurer, as defined in California Code of Civil Procedure Section 995.120, shall be accepted. If a California-admitted surety insurer issuing bonds does not meet these requirements, the insurer will be considered qualified if it is in conformance with Section 995.660 of the California Code of Civil Procedure, and proof of such is provided to the City.
[SIGNATURES ON NEXT PAGE]
O – Page 548 of 1107
(BB&K 2024) 17
SIGNATURE PAGE TO CONTRACT SERVICES AGREEMENT BY AND BETWEEN THE CITY
OF PALM SPRINGS AND UNIVERSAL GREEN LLC
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 – up to $150,000
Deputy/Assistant City Manager – up to $50,000
Director – up to $25,000
Manager – up to $5,000
O – Page 549 of 1107
(BB&K 2024) 18
EXHIBIT “A”
SCOPE OF SERVICES
1.1 Scope:
A. Contractor shall furnish all labor, tools, materials, and equipment, except where otherwise specified, to provide landscape and grounds maintenance services (Work).
B. The scope of work includes providing daily (7 days per week) landscape and grounds maintenance services of 20 City Facilities consisting of approximately 53 acres of total area including 22.4 landscaped areas, 3.1 acres of turf grass, and 950 trees (inclusive of turf, desert and native landscaped areas), and annual winter rye grass re-seeding. Tree trimming services are excluded except to the extent dead or damaged tree limbs have broken and are hanging from a tree, or fallen onto the ground and require removal, which is expressly included in the scope of work.
C. All work shall be done in a thorough and workmanlike manner to the satisfaction of the City and shall comply with all legal construction and landscape maintenance practices. The premises shall be maintained at the level of service always provided for in the scope of work.
D. The City has prohibited the use of gasoline leaf blowers. The Contractor shall only use electric, and battery powered leaf blowers.
E. Contractor shall recycle green waste generated from their contract performance and submit a monthly report identifying the weight and/or volume of green waste recycled.
F. Contractor shall provide landscape maintenance of all work sites, including, but not limited to the following:
1. Fertilize, prune, shape and trim trees, shrubs, vines and ground cover plants.
2. Control weeds and plant diseases.
3. Mow, edge and fertilize turf grass and blow hardscape clean.
4. Maintain plant material in a healthy condition with horticultural acceptable growth and color.
5. Inspect, maintain and repair all irrigation systems in their entirety.
6. Removal of Damaged Plant Material. All dead, damaged, declining, hazardous or broken plant material (Trees, shrubs, vines, ground cover, turf), whether a result of the Contractor negligence or an Act of God shall be removed by the Contractor at no additional cost to the City. This scope of work includes removal of dead or damaged tree limbs that have broken and are hanging from a tree or have fallen onto the ground.
7. Perform general area clean-up, including the removal of leaves, trash, dog feces and other debris from the work sites.
8. Maintain all work sites in a safe, attractive and usable condition.
9. Maintain hardscape and drainage systems.
O – Page 550 of 1107
(BB&K 2024) 19
G. The Contractor must provide continuous inspections of its work areas.
H. The City Contract Administrator will schedule inspections to monitor the Contractor’s activities and ensure that the work performed is done to the quality level and prescribed methods and time schedules.
I. Discrepancies and deficiencies in the work will be brought to the attention of the Contractor and corrected in the manner and time frame specified by the City.
J. The Contractor shall meet daily with the City Contract Administrator at a time mutually agreed upon by the City and the Contractor. This daily contact is for the purpose of discussing areas to be maintained, Contractors’ work schedule for the day, areas that need to be inspected for approval, and Site Inspection Forms that need to be signed off. Failure to contact the Contract Administrator or designate on a daily basis will constitute a breach of contract.
K. Emergency Response:
1. Contractor shall be available twenty-four (24) hours a day, seven (7) days a week to respond to all emergencies within two (2) hours of notification. (Emergencies that involve maintenance work included in these general conditions shall not be compensated).
2. Calls of an emergency nature received by the City shall be referred to the Contractor for immediate disposition.
3. If the Contractor cannot be reached and is unresponsive within the two (2) hour timeframe the City will deduct from the monthly billing the cost of City forces, or other sources, used to repair the emergency.
4. The Contractor shall not receive additional compensation for responding to emergencies for work included within the scope.
5. In situations involving emergency repair work after normal work hours, the Contractor shall dispatch qualified personnel and equipment to reach the site within two (2) hours.
a. The Contractor’s vehicle shall carry sufficient equipment to effect safe control of traffic.
b. When the Contractor arrives at the site, the Contractor shall set up traffic warning and control devices, if deemed necessary, and proceed to repair on a temporary/permanent basis.
c. If a City Representative is still at the site when the worksite Contractor arrives, the Contractor shall quickly evaluate the situation and discuss it with that responsible person.
1. If the repair will take only a few minutes, the City Employee may stay to continue to direct traffic while the Contractor makes the repairs.
2. If the repair will take longer than the City Employee can wait, the Contractor shall immediately set up temporary traffic control devices and all other necessary warning devices and relieve the City Representative.
d. The Contractor shall notify the City, or his representative by telephone within 24 hours of any emergency work that is performed.
O – Page 551 of 1107
(BB&K 2024) 20
L. Special Events:
1. Contractor shall be available during special events to provide general cleanup and trash/debris removal, including the following regularly scheduled parades:
a. Tour de Palm Springs (January)
b. Black History Month Parade (late February)
c. Palm Springs High School Homecoming Parade (late
October/November)
d. Greater Palm Springs Pride Parade (early November)
e. Veteran’s Day Parade (November 11)
f. Festival of Lights Parade (early December), and/or holiday weekends
2. Contractor shall also provide additional general cleanup and trash / debris removal during holiday weekends.
M. Areas to be Maintained:
1. Work sites may include medians, parkways, facilities, slopes, greenbelt areas, or natural areas.
2. An identification of the areas to be maintained is provided in the Appendix “A”
3. Inventories supplied with this bid package are only approximate and may contain errors.
N. Contractor shall perform a maintenance inspection, during daylight hours, of all areas. Such inspection shall be both visual and operational. It shall include, but not be limited to, the operation of all irrigation and/or other mechanical systems to check for proper condition and reliability. Contractor shall post signs indicating the system is being checked for maintenance purposes.
O. Contractor shall attend a mandatory inspectors’ meeting each week in order to receive important information and resolve any problems.
P. Contractor shall complete and submit a monthly Site Inspection form and keep a monthly complaint log.
Q. Site Inspection Form: The Site Inspection Form will consist of a written list of specified monthly tasks landscape and grounds maintenance. The Site Inspection Form shall be considered complete when all work on the sheet has been inspected and approved by the City and has been signed by both the City and the Contractor indicating that agreement exists as to the information shown on the Site Inspection Form. Such information shall consist of specific worksite locations and the acceptability of the maintenance activities performed. The completed sheets dated, certified, and signed by the Contractor and the City will be submitted to the City monthly along with an invoice with the Contractor’s letterhead, and an affidavit for evaluation and pay. It shall be mandatory that all forms be completed at the end of each month before another Site Inspection Form may be issued. Failure to obtain a Site Inspection Form prior to beginning the next month’s maintenance services can result in nonpayment for work performed.
O – Page 552 of 1107
(BB&K 2024) 21
R. Contractor Staff:
1. The Contractor shall furnish sufficient supervisory and working personnel capable of promptly accomplishing on schedule, to the satisfaction of the City, all work required under this contract during the prescribed hours. During this Contract, Contractor shall provide the following minimum crew assignments and full-time staffing levels on-site at all times:
a. One (1) full-time project manager/superintendent
b. Two (2) full-time lead workers
c. Two (2) full-time landscape technicians turf, and landscape maintenance. d. Two (2) full-time irrigation technicians
2. Contractor shall also provide additional manpower as needed to adequately perform all tasks as specified in the Contract.
3. All of these people shall work Monday through Friday and be assigned to the various facilities in the city. Additionally, workers shall be assigned to work a full eight (8) hour shift on Saturdays, Sundays and holidays to provide the City with seven (7) day-per-week coverage, as required on each Task List.
4. At least four (4) full-time employees shall be allocated seven (7) days per week and assigned to provide services at City Hall and Police Department, The City reserves the right to require additional full-time employees to be assigned to City Hall and Police Department if the required landscape maintenance services are not being adequately provided at these two facilities. All other facilities shall be maintained on a crew basis where the crews report in the morning, pick up trash and inspect the facilities. All other landscape tasks, such as horticultural, irrigation and support services, shall be accomplished throughout the day and work week, as specified in the Contract.
5. The Contractor shall have competent supervisors, who may be working supervisors, on the job always work is being performed who are capable to communicate effectively both in written and oral English and discuss matters pertaining to this contract. Supervisors must be able to demonstrate to the satisfaction of the City that they possess adequate technical background.
Adequate and competent supervision shall be provided for all work done by the Contractor’s employees to ensure accomplishment of high-quality work which will be acceptable to the City. Any order or communication given to the supervisor shall be deemed as delivered to the Contractor.
6. The Contractor, and their employees, shall always conduct themselves in a proper and efficient manner and shall cause the least possible annoyance to the public. The City may require a Contractor to remove from the work site any employee(s) deemed careless, incompetent, or otherwise objectionable, whose continued employment on the job is considered to be contrary to the best interest of the City.
7. The Contractor shall require each of his employees to wear basic public works working attire. These are basically proper shoes, and other gear required by State Safety Regulations, and proper wearing of the clothing.
Shirts shall be worn and always buttoned; safety vests are required when indicated by the Work Area Traffic Control Handbook, or the City.
O – Page 553 of 1107
(BB&K 2024) 22
8. The Contractor shall establish an identification system for personnel assigned to service this Agreement which clearly indicates to the public the name of the Contractor responsible for the landscape maintenance services.
The identification system shall be furnished at the Contractor’s expense and includes appropriate attire and/or name badges.
9. The superintendent, lead worker, landscape technician, and irrigation technician shall each have a cell phone in their vehicles and be always available for telephone contact during normal working hours to respond to calls and settle problems that may occur throughout the workday.
S. Apprenticeship Standard: Where required under law, the Contractor shall assume full responsibility for compliance with apprenticeship standards as established by Section 1777.5 of the California State Labor Code.
T. Protection of Public / Safety:
1. The Contractor shall perform all work outlined in these specifications in such a manner as to provide maximum safety to the public, and meet all accepted standards for safe practices during the maintenance operation; to safely maintain equipment, machines, and materials or other hazards consequential or related to the work; furthermore, to accept the sole responsibility for complying with all local, County, State or other legal requirements including, but not limited to, OSHA and CAL-OSHA.
2. Adequate warning devices, barricades, guards, flagmen or other necessary precautions shall be taken by the Contractor to give advised and reasonable protection, safety and warning to persons and vehicular traffic concerned in the area. All construction signing, lighting and barricading shall be in accordance with Part 6 “Temporary Traffic Control” of the California Manual on Uniform Traffic Control Devices (CA-MUTCD) for Streets and Highways, or subsequent editions in force at the time of construction. Part 6 of the California MUTCD is available online at: https://dot.ca.gov/programs/safetyprograms/camutcd.
3. All signs, barricades and other temporary traffic control devices required for the work shall be the responsibility of the Contractor.
4. The City, or his representative, reserves the right to issue restraint, or cease and desist orders, to the Contractor when unsafe or harmful acts are observed or reported relative to the performance of work under this contract.
U. Hazardous Conditions:
1. It shall be the Contractor’s responsibility to identify, any condition(s) that renders any areas within this Agreement unsafe, as well as any unsafe practices occurring thereon. The City shall be notified immediately of any unsafe condition that requires major correction.
2. The Contractor shall be responsible for making minor corrections including, but not limited to, filling holes in landscaped areas and paving, diverting water sheet flow, using barricades or traffic cones to alert persons of the existence of hazards, replacing valve box covers, and securing exercise and/or play apparatus to protect all persons from injury.
3. The Contractor shall inspect all work sites for hazards, or potential hazards daily.
O – Page 554 of 1107
(BB&K 2024) 23
4. During the required inspection of all work sites for hazards, or potential hazards, the Contractor shall keep a log indicating the date the area was inspected, any unsafe conditions, and the action taken.
5. The Contractor shall cooperate fully with the City in the investigation of any accidental injury or death occurring on the premises, including the submission of a complete written report thereof to the City within five (5) days following the occurrence.
V. Non-Interference: The Contractor shall not interfere with the public use of the premises, nor disrupt the peace and quiet of the area within which the services are performed. Contractors shall conduct their operations to offer the least possible obstruction and inconvenience to the public.
W. Reporting Damage or Malfunction: Any damage to, or malfunction of, any facility not specifically stated in this Agreement shall be promptly reported to the Project Manager.
X. Wear & Tear, Vandalism / Theft:
1. The Contractor shall be responsible for reporting any vandalism/theft of existing landscaped areas which are maintained under this contract and damaged or altered in any way as a result of theft and/or mysterious damages that do not result from the performance of the Contractor.
2. The Contractor shall be responsible for performing maintenance, repairs, and replacement of existing landscaped areas which are maintained under this contract and damaged or altered in any way as a result of theft and/or mysterious damages that do not result from the performance of the Contractor
3. Compensation will be reimbursed only for the cost of parts which are directly related to the normal wear and tear, theft and/or vandalism; labor shall be provided by the Contractor at no additional cost to the City. The Contractor must receive the City’s prior approval and shall maintain a full accounting of any additional parts.
4. The following conditions shall be met prior to the Contractor identifying additional parts as being needed due to normal wear and tear, theft and/or vandalism, and for any proposal of Extra Work requiring additional payment over and above the monthly allowance:
a. Submit a written proposal for the replacement part(s) costs documenting with photos the condition of the part requiring replacement, or the theft or vandalism that has caused the damage requiring repair to the irrigation system.
b. Secure written authorization for the purchase of the replacement parts by the City, or his delegated representative.
c. Submit a photocopy of the original invoice(s) for the replacement parts. d. Submit a copy of a report filed with the City Police Department which relates to the specific incident if required by City.
Y. Utilities:
1. The City shall pay for the maintenance-related water and electrical utilities.
O – Page 555 of 1107
(BB&K 2024) 24
2. The Contractor may pay for all excessive utility usage due to the Contractor’s failure to repair irrigation systems or unauthorized increases in water usage.
3. The excess cost will be determined by comparing the current usage with historical usage for the same time period.
4. The excess cost factor may be deducted from payments to the Contractor; however, the Contractor will be allowed to explain the increase in utility usage prior to the actual deduction.
Z. Local Office:
1. The Contractor shall maintain an office with a telephone and always provide the following:
a. A responsible person(s), employed by the Contractor, which shall have the ability to take necessary action regarding all inquiries and/or complaints received from the City or the City.
b. This person(s) shall be reachable twenty-four (24) hours per day and seven (7) days per week.
c. An answering service shall be considered an acceptable substitute to fulltime coverage, outside of prescribed working hours, provided the Contractor is notified of any communication within one (1) hour after receipt of said communication.
d. The telephone number(s) of the Contractor or responsible person(s) of the Contractor shall be a toll-free number for the City.
2. During normal working hours, the Contractor’s Supervisors, who are responsible for providing maintenance services, shall be available for notification through cellular telephone communication.
AA.Storage Facilities: The City shall not provide any storage facilities for the Contractor. The City’s Corporate Yard is a secure facility and shall not be used by the Contractor. The Contractor shall be responsible for obtaining an appropriate administrative office, storage yard, and secure parking lot for its equipment and vehicles. The location of its facility shall be within the City of Palm Springs, subject to the approval of the City.
BB.Locks and Keys and Controller Remote Transmitters:
1. Where City locks and keys are required as part of this contract, the Contractor shall:
a. Not duplicate any coded City key furnished by the City. b. Surrender all keys furnished by the City at the end of the contract period, or at any time deemed necessary by the City to prevent loss to the City. c. Protect the security of City property by keeping controller cabinet and enclosure doors always locked.
d. Refrain from using premises behind locked doors for storage of materials, supplies or tools except as approved by the City.
e. Be required to pay a $100.00 deposit for each key issued to open controller cabinets. This deposit is refundable upon return of the key to
O – Page 556 of 1107
(BB&K 2024) 25
the City. Loss of a key will result in the forfeiture of the key deposit and may restrict the City from issuing any future keys.
f. Be required to pay a $450.00 deposit for each controller remote transmitter issued to the Contractor. This deposit is refundable upon return of the remote transmitter in good condition to the City. Loss of the remote transmitter or a return of a non-working remote transmitter will result in the forfeiture of the deposit and may restrict the City from issuing any future remote transmitters.
CC. Signs:
1. The Contractor shall not post signs or advertising matter upon the areas under maintenance or improvements thereon.
2. The Contractor shall, always, remove all unauthorized signs and advertising matter in the areas under maintenance.
DD. Parking:
1. During the Contractor’s daily operations and completion of the Work, the Contractor shall park their vehicles and equipment within designated public parking areas or approved locations, in accordance with local and state laws, maintaining clear travel lanes for vehicular traffic. Overnight parking of the Contractor’s vehicles and equipment shall be located within the Contractor’s own secured storage facility, and not within any City facilities or public parking lots.
2. The Contractor’s vehicles and equipment shall not be parked or set in such a manner that they block pedestrian access or vehicular right-of-way except as required to comply with all safety standards of OSHA or CAL-OSHA.
EE.Vehicles: The Contractor’s vehicles used in performance of the services required hereunder shall be maintained in first class condition. Upon commencement of the services, the Contractor shall furnish and apply an appropriate logo on all vehicles to be used within the City identifying the Contractor’s company and its capacity working on behalf of the City. The logo shall be prepared by the Contractor and submitted to the City for approval prior to use.
FF.Unknown Obstructions: Should any unknown obstruction be encountered during this contract the Contractor should immediately bring it to the attention of the City. The Contractor shall be responsible for the protection of all existing equipment, furniture, or utilities encountered within the work area.
GG. Removing Obstruction and Maintenance of Existing Improvements:
HH. Use of Chemicals:
1. The Contractor shall submit a list of all chemical herbicides and pesticides, proposed for use under this contract for approval by the City. Materials included on this list shall be limited to chemicals approved by the State of California Department of Pesticide Regulation and shall include the exact brand name and generic formulation. The use of any chemical on the list shall be based on the recommendations of a licensed pest control advisor where required by law.
2. The City has prohibited the use of any herbicide containing Glyphosate.
O – Page 557 of 1107
(BB&K 2024) 26
3. The use of chemicals shall conform to the current County of Riverside Agriculture Commissioner regulations. No chemical herbicide or pesticide shall be applied until its use is approved, in writing, by the City as appropriate for the purpose and area proposed.
1.2 Work Standards:
A. Method of Irrigation
1. Since water requirements by plants vary according to the season and a particular year, extremely close attention shall be paid to the demands of the plants as influenced by their exposure to sun, wind, shade and location in the individual planters. The variation in size of plants installed, as well as the varieties, shall be taken into consideration. All landscaped and turf areas shall be irrigated as required to maintain adequate growth and appearance with a schedule most conducive to plant growth for operational mode.
2. Contractor shall create an annual irrigation schedule, post within each controller and provide a copy to the Contract Administrator.
3. Adequate soil moisture shall be determined by programming the irrigation system as follows:
a. Adjusting and setting the automatic controller to establish frequency and length of watering period.
b. Consideration must be given to the soil conditions, humidity, minimizing runoff and the relationship of conditions which affect day and night watering. This may include daytime watering during freezing weather to prevent icy conditions and manual operation of the irrigation system and/or hand watering with portable sprinklers during periods of windy or inclement weather.
c. A soil probe shall be used to a depth of twelve inches (12”) to determine the water penetration by random testing of the root zones.
4. Watering shall be regulated to avoid interference with any use of the facility’s roadways, paving or walks.
5. In the areas where wind creates problems of spraying water onto private property or road rights-of-way, the controllers shall be set to operate during the period of lowest wind velocity, which would normally occur at night or during early morning hours.
6. Irrigation system shall be controlled in such a way as to not cause any excessively wet or “waterlogged” areas that could interfere with the ability to mow all turf. “In lawn” trees and other planting shall be protected from over watering and runoff drowning.
7. New turf [up through the sixth (6th) mowing] shall be watered immediately after mowing. Well-established turf shall not be watered for at least four (4) hours after mowing.
8. All ground cover areas shall be watered as needed to maintain a healthy condition, with appropriate care being taken to not over water in shady areas.
9. Contractor shall be responsible for the operation of the automatic controllers, valves and sprinkler heads in managing the overall irrigation water delivery
O – Page 558 of 1107
(BB&K 2024) 27
system of the area. All irrigation systems shall be regularly inspected and tested in accordance with the specifications set forth herein.
10. Contractor shall ensure that all personnel working on the irrigation system are fully trained in all phases of landscape irrigation systems and can easily identify and isolate problems and perform the proper testing and inspection of the irrigation system and the maintenance of the sprinkler heads. This knowledge of landscape irrigation systems shall include, but not be limited to, the operation, maintenance, adjustment and repair of said systems and their components.
11. Contractor shall be responsible for total maintenance of the irrigation system by performing the following tasks:
a. Setting, scheduling, and monitoring all irrigation controllers. b. Inspecting and reporting of irrigation system status. c. Adjusting and cleaning of sprinkler heads.
d. Repairing or replacing broken or damaged sprinkler heads with equal size and quality.
e. Providing all P.V.C. schedule 80 nipples, caps, plugs, elbows, couplings, fittings, etc.
f. Providing replacements of all risers and swing joints due to normal wear, vandalism and/or third-party negligence.
g. Flushing irrigation pipelines, as needed.
h. Replacing valve box covers due to normal wear, vandalism and/or thirdparty negligence with ones of equal size and quality. i. Replacing and/or relocating sprinkler heads. Contractor shall confer with the Contract Administrator regarding the need for replacement or relocation of sprinkler heads. City may require the Contractor, at no additional cost, to relocate the sprinkler heads to those areas within the facility identified by the Contract Administrator
j. Repairing and/or replacing the following items of the irrigation system with equal size and quality: quick couplers, automatic valves, gate valves, valves, automatic controllers, and back flow devices.
k. Annual inspection of the back flow devices.
12. Complete piping replacement of the irrigation system shall not be required by the Contractor. Contractor shall be responsible for the repair or replacement of leaking main and lateral irrigation lines.
13. Replacement of irrigation components shall be completed within twenty-four (24) hours of determining damage or inoperable irrigation components or as otherwise specified.
14. Replacement for the irrigation system shall be with originally specified equipment of the same size and quality or substitutes approved by the Contract Administrator prior to any installation thereof.
O – Page 559 of 1107
(BB&K 2024) 28
15. Maintenance of the water and irrigation systems is one of the most important functions of this Contract. The City expects the Contractor to properly staff, inspect and maintain these systems to the highest possible standard.
16. Water supplied by the City for irrigation may be Recycled Water, indicated by purple color-coded sprinklers, valves, valve boxes, tags and signs.
Contractor understands that recycled is not intended for human contact or consumption.
17. Contractor accepts full responsibility for educating and monitoring its employees regarding safety issues related to the presence and use of Recycled Water, and for having appropriate state licenses required for operation and maintenance of Recycled Water systems.
B. Initial Irrigation Inspection
1. Contractor shall initially inspect and familiarize themselves with the entire irrigation system at all work sites and identify all needed repairs.
2. Required repairs shall be submitted to the City in a written statement within two (2) weeks after the start date of the maintenance contract.
3. If a written statement which documents required repairs is not received by the City within the stated timeframe, the entire system shall be interpreted as fully operational, and deemed acceptable by the Contractor.
4. The City shall review and verify all submitted repairs from the initial inspection. Repairs may be completed by the following methods:
a. Authorize the Contractor to make appropriate repairs. b. Use City forces to make required repairs.
c. Use another source to make required repairs.
5. Upon completion of all repairs following the initial inspection, the Contractor shall sign-off each individual area as being fully operational C. Weekly Irrigation Inspections
1. To ensure the operability of the irrigation system, Contractor shall sequence controllers to each station manually to check the function of all facets of the irrigation system and report any damage or incorrect operation to the Contract Administrator. This shall be done weekly in all areas and immediately following the mowing operation in all turf areas.
2. During testing, Contractor shall:
a. Adjust all sprinkler heads for correct coverage to prevent excessive runoff and/or erosion and the spread of water onto roadways, sidewalks, hard surface areas, buildings and private property.
b. Unplug clogged heads and flush lines to free lines of rocks, mud and debris.
c. Replace or repair inoperable irrigation equipment.
d. All system malfunctions, damage and obstructions shall be recorded, reported to the Contract Administrator and corrective action taken.
O – Page 560 of 1107
(BB&K 2024) 29
3. In addition to regular testing, all irrigation systems shall be tested and inspected as necessary when damage is suspected, observed or reported.
4. Malfunctioning sprinkler heads shall be repaired or replaced within one (1) watering cycle.
5. Malfunctioning irrigation systems and equipment shall be corrected within two (2) hours of identification or following verbal notification.
6. The irrigation system shall be controlled during inclement weather conditions and the use of water limited concurrent with the weather situation to the satisfaction of the Contract Administrator.
7. The irrigation lines shall be flushed of grit and gravel by removing the last head on each lateral and operating the system until those materials are expelled.
8. A weekly report, indicating the time and date of each site inspection, shall be given to the City. This report shall be in a form acceptable to the Contract Administrator.
9. In addition to regular weekly testing, all irrigation systems shall be tested and inspected as necessary when damage is suspected, observed or reported.
10. All system malfunctions, damage and obstructions shall be recorded, reported to the City, and corrective action taken.
D. Irrigation Maintenance and Repairs – Irrigation system repairs is required for all areas to be maintained.
1. Contractor shall maintain all irrigation systems in such a way as to:
a. Guarantee proper coverage and full working capability. b. Make whatever adjustments may be necessary to prevent overspray or excessive runoff into street right-of-ways or other areas not meant to be irrigated.
2. All irrigation system repairs shall be provided by the Contractor at no additional cost to the City, except for any parts required for such repairs upon prior City approval pursuant to Part One, Section K of these specifications.
3. Contractor shall repair or replace inoperable irrigation equipment to maintain a fully operational system, including but not limited to, pressure pipes from the water meter to the control valves, all irrigation pipes, all manual and automatic valves, pumps used for the irrigation systems, backflow devices, filters, strainers, pressure regulators, sprinkler heads, irrigation clamps and stakes, anti-drain valves, quick couplers, electrical wiring from the controller to the solenoid valves, emitters, drippers, valve boxes, controllers, valve markers, batteries, fittings and risers.
4. Maintenance includes, but is not limited, tightening of loose fittings and packing nuts; flushing sprinkler heads, pipes, nozzles, valves, filters, strainers, and backflow devices; adjusting sprinkler heads, anti-drain valves and pressure regulators, adjusting and lubricating controllers; and cleaning drip emitters.
5. Irrigation repairs shall be made within the following time limits:
O – Page 561 of 1107
(BB&K 2024) 30
a. Mainline irrigation breaks shall be repaired within two (2) hours of identification or notification.
b. All other irrigation repairs shall be made within one (1) day of identification or notification.
c. Failure to complete irrigation repairs in the timeframes listed above will result in the City utilizing City forces, or an alternate source, to correct the deficiency and deduct from the Contractor’s payment the total cost, including City overhead.
6. Replacement of irrigation components shall be with originally installed materials of the same size and quality. Substitutions must be approved by the City in writing prior to installation.
7. Contractor shall implement repairs in accordance with all effective warranties, and no separate payment shall be made for repairs on equipment covered by warranty.
8. The Contractor shall keep all irrigation heads clean of flow impediments and adjusted properly at all times.
9. Contractor shall be responsible for adjusting height of sprinklers and risers as necessary to compensate for growth of plant material.
10. Contractor shall restore any landscape areas disturbed by irrigation repair work back to their preexisting condition.
11. Damages to plant material due to the Contractor’s lack of performance in accordance with these specifications shall be the responsibility of the Contractor; dead or damaged plant material shall be replaced at the Contractor’s expense.
12. Damage to the irrigation system caused by conditions under which the Contractor has no control, shall be repaired by the Contractor at the City’s expense, if approved in advance by the City.
13. At any time, the City may request a coverage test to evaluate proper settings, timing, usage, or maintenance of system.
14. The Contractor shall keep all controller enclosures free of debris and pests (slugs, ants, spiders, etc.) always. Any resultant damage due to the Contractor not meeting this specification will be the responsibility of the Contractor.
15. The Contractor shall be responsible for hand watering at no additional cost for any areas not provided with an automatic irrigation system. Contractor will also be required to hand water at no additional cost any landscape areas with a non-functioning irrigation system if it is the Contractor’s responsibility to maintain that system.
16. The Contractor may be required to hose off plant material monthly in areas where a drip system is used.
17. Contractor shall maintain an adequate inventory of medium to high usage stock items for repair of the irrigation system.
E. Water Conservation – The City utilizes a central irrigation system
O – Page 562 of 1107
(BB&K 2024) 31
1. Contractor shall monitor all irrigation systems during periods of rainfall and/or times when suspension of irrigation is desirable to conserve water while remaining within the guidelines of good horticulturally acceptable maintenance practices. Contractor shall notify the Contract Administrator any time irrigation systems are turned off.
2. Contractor shall comply with all City Ordinances and/or Resolutions which relate to water conservation.
F. Turf Grass Care
1. Turf Grass Mowing:
a. Contractors shall submit, in writing, a mowing schedule within ten (10) days after the start of the maintenance. This mowing schedule shall be approved by the City.
1. All turf areas shall be mowed once every week.
2. Any alteration of the approved mowing schedule shall be submitted in writing to the City for approval prior to implementation. b. Contractor shall mow all turf grass with adequately sharpened reel or rotary type mowers as to provide a smooth and even cut without tearing of turf grass blades.
c. Unless otherwise directed by the City, cut cool season turf grass at two (2) inches by using rotary type mowers.
d. Unless otherwise directed by the City, mowing height for regular Bermuda grass and ryegrass shall be not less than three-fourths inch (3/4”). Mowing height may be set as high as one and one-half inch (1- 1/2”), with one inch (1”) being considered normal. Mowing height for hybrid Bermuda grass shall be no less than one-half inch (1/2”). Mowing height may be set as high as three-fourths inch (3/4”), with five-eighths inch (5/8”) being considered the normal for hybrid Bermuda grass.
Mowing heights may vary for special events and conditions. e. Avoid removing more than one-third of the leaf area blade at any one time.
f. All mower blades shall be sharpened or replaced at least twice a week.
The blade adjustment shall provide a uniform, level cut without ridges, depressions, or scalping.
g. All debris must be removed daily and disposed of legally off-site. h. Care shall be exercised during the mowing operation to prevent damage to trees and other obstacles located within the turf areas such as electrical boxes or fixtures.
i. Do not mow areas that are saturated with water. Alternate mowing patterns shall be used whenever possible to prevent wheel ruts in turf areas. If ruts are made, Contractor shall make all necessary repairs at the Contractor’s expense.
j. The City shall approve of all mowing equipment used by the Contractor.
O – Page 563 of 1107
(BB&K 2024) 32
k. Small rotary push mowers will be required for parkways and other small areas.
2. Turf Grass Edging and Trimming:
a. Turf grass edging and trimming shall be performed once every week at the time of mowing.
b. Edging of turf grass shall be performed with a power edger containing a steel blade.
c. All turf grass adjacent to sidewalks, curbs, mowing strips, shrub beds, and where no improved surface exists, shall be edged in a neat uniform line.
d. Trimming of turf grass shall be performed along walls, and around valve boxes, water meter boxes, backflow devices, trees, shrubs, or any structures located within the turf grass area.
e. Tree trunk protectors shall be provided and installed, at no additional cost to the City, when string trimmers are utilized for trimming around the base of trees. The City may allow a sixteen (16) inch diameter mulch ring around trees to eliminate continual string trimming.
f. In areas where there is no mow curb, a six (6) inch barren strip shall be provided, and maintained, between turf grass and adjacent ground cover.
Edging of turf grass and ground cover shall provide uniform delineation adjacent to this barren strip.
g. Trimming of plant material may be required around sprinklers to provide maximum irrigation coverage.
h. All clippings and trimmings shall be removed from the work site the same day work is performed and prior to a Contractor vacating the work site.
At no time shall the Contractor blow clippings into the planter areas. i. After mowing and edging is completed, all adjacent walkways and gutters shall be swept clean. At no time shall the Contractor blow clippings from gutters into the turf grass. All clippings must be removed from site.
3. Turf Grass Fertilization:
a. The turf grass shall be fertilized monthly, or as directed by the Contract Administrator to provide a healthy and vigorously growing turf grass with horticulturally acceptable growth and color, as determined by the City. b. Fertilization shall be performed with a balanced fertilizer, consisting of a 4-1-2 ratio, at a rate of one (1) pound of actual Nitrogen per 1,000 square feet of area. Confirm type of fertilizer to be used in advance with the City Contract Administrator; the type of turf and time of year will determine the type of fertilizer used.
c. Fertilizer shall be applied as often as required to always maintain deep green color. The frequency of application will greatly depend on the amount of leaching caused by excess use of water.
d. Contractor shall notify the City, in writing, five (5) working days prior to any fertilizer application. This written document shall include the following:
O – Page 564 of 1107
(BB&K 2024) 33
1. Location and exact date the fertilizer application will be performed.
2. Type of fertilizer and method of application to be used. e. Contractor shall immediately irrigate after each fertilizer application. f. All fertilizer applications shall be performed with properly calibrated equipment to provide a uniform application.
4. Turf Grass Aeration:
a. All turf areas shall be aerated by using a device that removes cores to a depth of two inches (2”) at not more than six inches (6”) spacing. b. All turf areas shall be aerified twice annually during the growing season from April to August.
5. Turf Grass Irrigation:
a. All turf grass shall be adequately irrigated to maintain a healthy and attractive appearance.
b. Irrigation run-off and overspray shall be minimized. c. A regular, deep watering program shall be implemented to give the best results.
d. Allow turf to dry out before mowing.
G. Annual Winter Rye Grass Over-Seeding
1. All turf areas may be selected for annual winter rye grass over-seeding by the City. The approximate acreage of turf areas to be maintained are identified in the Appendix “A”. Contractor shall provide the quantity of Pure Live Seed necessary to over-seed all areas as specified. Over-seeding is usually done in the Fall beginning as early as September. The Contractor shall provide a schedule for annual over-seeding for City Facilities.
2. The Contractor shall provide additional staff and multiple crews, as may be necessary to ensure all regular landscape maintenance services continue concurrently with the annual over-seeding.
3. All schedule changes or modification must be pre-approved by the Contract Administrator.
4. All areas shall be scalped, vertically mowed and swept free of any loose grass clippings and debris. A maximum acceptable height of remaining turf after this operation is one-fourth inch (1/4”). Soil must be visible throughout the turf area to ensure positive soil contact with the seed.
5. Scalping hall be “smart scalping” and contractor shall provide proof of completing the online College of the Desert Landscaper course which covers this process. See www.collegeofthedesert.edu/pace
6. Debris generated or accumulated during the course of the renovation operations shall be removed from the landscape site and disposed of at an appropriate landfill or disposal site at Contractor’s expense. If stockpiling is necessary, pre-approval to do so must be obtained from the Contract Administrator and all material must be removed daily. Absolutely no debris shall be allowed to be left on site after scheduled daily work hours.
O – Page 565 of 1107
(BB&K 2024) 34
7. Irrigation in all areas that may have been damaged as a result of renovation practices must be repaired immediately prior to seeding with acceptable methods and materials at Contractor’s expense. Approval prior to seeding in any area shall be a consensus judgment between the Contractor and the City, if applicable.
8. Acceptable performance and turf renovation practices shall be at the sole judgment of the City. If adequate renovation is not performed within any turf area, Contractor may be required to redo any area, in whole or in part, to achieve the desired and intended result. This shall be done at the sole discretion of the City’s representative or authorized designee.
9. For overseeding purposes, all turf areas shall be fertilized with a “balanced” fertilizer blend with a minimum guaranteed analysis of fifteen percent (15%) nitrogen, fifteen percent (15%) phosphorus, and fifteen percent (15%) potassium at the time of overseeding. This fertilizer application shall be in addition to all other fertilization requirements as referred to in this document.
Fertilization must occur prior to the initial irrigation on the seed. Minimum rate: one (1) pound each of actual nitrogen, phosphorus and potassium per thousand square feet of area covered.
10. Seeding shall be done after renovation and prior to fertilization. Seeding must be done in two (2) perpendicular directions at half the recommended rate in each direction to ensure even coverage. After seeding and prior to fertilization, turf is to be mowed at one-fourth inch (1/4”), with grass stubble debris to remain in place for additional coverage.
11. Only Oregon-grown “Blue Tag Certified” seed shall be allowed. Seed must be a perennial ryegrass blend. A minimum of two (2) locally proven grass varieties and not more than three (3) varieties may be used in the blend. The maximum allowable percentage of any single variety within the blend shall not exceed fifty percent (50%) of the entire blend.
12. To compute seeding rates as required, the PLS method shall be used. This calculation is based upon determining viable seedlings by multiplying the germination percentage, as stated on the bag tag, by the percentage of pure seed, as stated on the bag tag, per individual seed lot.
13. Rates will vary depending upon the area of application. An approximate total acreage of each area shall be provided, although bids are to be based upon a per-acre basis.
14. General turf areas shall be seeded at twelve (12) pounds PLS per one thousand (1,000) square feet.
H. Weed Control
1. Weed control shall be provided at all sites, daily.
2. Chemical application may be used in and around certain sites, such as planters, areas adjacent to buildings, trees, fence lines, sprinkler heads, etc., as approved by the Contract Administrator. Prior to application of chemicals, all areas shall be trimmed to proper mowing height. Chemicals shall be applied in a manner to limit drift to four inches (4”). Precautionary measures shall be employed since all areas will be open for public access during application.
O – Page 566 of 1107
(BB&K 2024) 35
3. Spot treat with a portable sprayer or wick wand using a herbicide approved by the Contract Administrator and applied in accordance with the manufacturer’s recommendations. Water shall not be applied to treated areas for the length of time specified by the product manufacturer.
4. Where trees and shrubs occur in turf areas, all grass growth may be limited to at least eighteen inches (18”) from the trunks of trees and away from the drip line of shrubs by use of approved chemicals upon approval to do so by the Contract Administrator.
5. Linear chemical edging of turf boundaries may be performed in a manner that ensures a defined turf edge and limits its encroachment into beds or across boundaries where it is impractical to edge mechanically. A four-inch (4”) barrier width shall be considered normal.
6. Detailing of sprinkler heads to provide maximum water coverage, valve boxes, meter boxes, and similar obstacles in turf areas may be performed in a manner that ensures operability, ease of location and/or a clean appearance. A four-inch (4”-) clearance shall be considered normal.
7. All grass like-type weeds, morning glory or vine-weed types, ragweed or other underground spreading weeds shall be kept until strict control.
8. All weeds and grass shall be removed from the following areas: roadways, driveways, parking lots, patios, drainage areas, slopes, hillsides, and expansion joints in all hard-surface areas.
9. All weeds shall be mechanically removed from shrub beds, planters and other cultivated areas.
10. Weeds treated with a contact weed chemical shall be left in place for a minimum of seven (7) days. If kill is not complete, additional applications shall be made, at no additional cost to the City, until target species are eliminated.
All turf and landscape areas are to be treated annually with a systemic preemergent granular weed control agent for the control of both broadleaf and grassy weeds. This application shall be included in the base price for the Contract. The material to be used and the application method proposed shall be approved by the Contract Administrator prior to application.
11. Weeds treated using a systemic chemical shall be left in place in accordance with the manufacturer’s recommendation. The initial application of preemergent herbicides typically occurs in the early spring months from February to April each year. If kill is not complete by the time specified in the manufacturer’s recommendation, a second application, at no additional cost to the City, shall be made at the request of the Contract Administrator.
12. After complete kill, all dead weeds shall be removed from the area.
I. Shrub Care
1. Pruning of Shrubs:
a. Shrubs shall be pruned once per month, or as required for removal of broken, dead and diseased branches, general containment, and appearance.
O – Page 567 of 1107
(BB&K 2024) 36
b. All shrubbery shall be pruned, trimmed, thinned, and suckers removed to properly contain its size with respect to species, size of planters and the best health of the plant.
c. Prune shrubs to retain as much of the natural informal appearance as possible, consistent with intended use.
d. Shrubs used as formal hedges or screens shall be pruned as required to present a neat appearance.
e. Remove any spent blossoms or dead flower stalks as required to present a neat appearance.
f. Shrubs and mounding shall not exceed 2 feet in height within areas required for vehicle sight distance depending upon roadway topography (i.e. medians and street corners).
g. Shrubs shall be pruned and trimmed using sound horticultural techniques.
h. Shrubs shall be maintained within the limits of confined areas (i.e., narrow medians, walkways, etc.) so as not to encroach on same. i. Shrubs shall be trimmed to maintain horizontal clearance along all walkways and trails to prevent encroachment onto private property.
2. Shrub Fertilization:
a. Shrubs shall be fertilized once a year to maintain horticulturally acceptable health and color.
b. Foliar fertilization may be performed when appropriate. c. Fertilizing shall be performed with a balanced fertilizer, consisting of a 1- 1-1 ratio, at a rate of one (1) pound actual Nitrogen per 1,000 square feet.
Any change in the fertilizer ratio and/or rate shall be submitted in writing and approved by the City prior to usage.
3. Irrigation of Shrubs:
a. All shrubs shall be adequately irrigated to maintain a healthy and attractive appearance.
b. Irrigation run-off and overspray shall be minimized.
4. Shrub Replacement:
a. All damaged, diseased (untreatable) or dead shrubs shall be replaced with the exact same species of plant and size of plant will be determined by the Department. Contractor shall be responsible for the complete removal and replacement of shrubs lost due to the Contractor’s faulty maintenance or negligence, as determined by the City.
b. All dead Shrubs must be replaced within one month.
c. Substitutions for any plant materials must have prior written approval by the City.
d. Original plans and specifications shall be consulted to determine correct identification of species.
O – Page 568 of 1107
(BB&K 2024) 37
e. All shrubs shall be guaranteed to live and remain in a healthy condition for no less than six (6) months from the date of installation, inspection and verification by the City.
f. Care shall be taken to prevent soil build-up around the crown of shrubs.
J. Vine Care
1. Vines and espalier plants shall be checked and retied as required. Secure vines with appropriate ties to promote directional growth on supports.
2. Do not use nails to secure vines on masonry walls.
3. Pruning of vines will be in accordance with good horticulture practices.
4. Vines shall be trimmed as required for safety, disease, general containment or appearance, or as directed by the Contract Administrator.
5. All vines planted on walls shall be trimmed and maintained 18” from the top of the wall. This distance may be modified at the discretion of the Contract Administrator.
6. Vine Irrigation:
a. All vines shall be irrigated to maintain a healthy and attractive appearance.
b. Where possible the vine irrigation shall be on a separate program from turf grass.
c. Existing vines planted in pockets not provided with sprinklers shall be deep watered as needed to promote optimum growth.
K. Ground Cover Care
1. Ground covers are low growing plants that grow in colonies to form a solid mat over the surface of the ground. The plants give a flat or two-dimensional effect to the landscape, such as, but not limited to arctotheca, gazania, vinca, lonicera, ivy, trachelosperum, and varieties of iceplant.
2. Edging and Trimming of Ground Cover:
a. Edging of ground cover areas shall be performed every other month. b. All ground cover adjacent to sidewalks, curbs, mowing strips, or where no improved surface exists, shall be edged in a neat, uniform line. c. All ground cover shall be continually trimmed at the drip line of all shrubs. d. Keep ground cover trimmed back from all utility cabinets, irrigation controller units, valve boxes, quick couplers, or any other appurtenances or fixtures.
e. Do not allow ground cover to grow up the trunks of trees, into shrubs, on structures or walls unless directed by the Contract Administrator. f. Keep ground cover trimmed back approximately 4 inches from structures, walls, etc.
g. Coordinate trimming around base of shrubs/trees with the Contract Administrator.
O – Page 569 of 1107
(BB&K 2024) 38
h. Trimming of ground cover may be required around sprinklers to provide maximum irrigation coverage.
i. All clippings and trimmings shall be removed from the work site the same day work is performed and prior to the Contractor vacating the work site. j. After edging or trimming, the Contractor shall sweep clean all adjacent sidewalks or gutters.
k. Weeds hall be controlled and not allowed to reach two inches (2”) in height. Remove weeds by chemical or mechanical means as approved by the Contract Administrator.
3. Ground Cover Irrigation: All ground cover areas shall be adequately irrigated to maintain a healthy and attractive appearance. Irrigation run-off and overspray shall be minimized.
4. Ground Cover Fertilization:
a. The ground cover shall be fertilized one (1) time per year to provide a healthy and vigorously growing ground cover with horticulturally acceptable growth and appearance, as determined by the City. b. Fertilizing shall be performed with a balanced fertilizer, consisting of a 1- 1-1 ratio, at a rate of one (1) pound actual Nitrogen per 1,000 square feet. c. Contractor shall immediately irrigate after each fertilizer application. d. All fertilizer applications shall be performed with properly calibrated equipment to provide a uniform application.
e. Contractor shall notify the City, in writing, five (5) working days prior to any fertilizer application. This written document shall include the following:
1. Location and exact date the fertilizer application will be performed.
2. Type of fertilizer and method of application to be used.
L. Disease and Pest Control
1. Contractor shall monitor and provide disease and pest control on a weekly basis, as follows:
a. Contractor shall practice Integrated Pest Management. This shall involve common-sense practices that use environmentally acceptable methods of pest control with the least possible hazard to the public, City property, and the environment. Practices shall combine the use of current information on pest life cycles, exclusion, natural enemies, and host resistance.
b. Contractor shall provide complete control of all plant pests and/ or diseases.
c. The Contractor shall obtain all necessary licenses and permits to comply with City, County, State and Federal regulations or laws. d. Contractor will assume responsibility and liability for the use of all chemical controls.
O – Page 570 of 1107
(BB&K 2024) 39
e. Pest and disease shall include, but shall not be limited to all insects, mites, other vertebrates, and invertebrates including pocket gophers and squirrels, pathogens and nematodes.
f. All material use shall be in strict accordance and applied within the most current EPA regulations and the California Food and Agricultural Code. g. All areas of the landscape shall be inspected for infestations of pests such as ants, insects, mites, snails, and sow bugs. Plants shall be observed closely for leaves that may be blotched, blighted, deformed, mildewed, rusted, scorched, discolored, defoliated, or wilted.
h. Contractor shall identify the cause of plant injury and consult a Pest Control Advisor before application of chemical treatments. i. Cultural preventive methods shall begin before a pest is visible. At certain times of the year, and with certain environmental conditions, the presence of certain pests can be anticipated. New plant growth shall be monitored for the presence of aphids, leaf hoppers, scale, mealy bugs, and mites. A 10-power magnifying glass is helpful for identifying mites.
Evidence of ant activity may be seen in soil, along walks, and trunks of shrubs and trees.
j. Adult beetles shall be controlled before they lay eggs on bark in the spring. Ongoing inspections are necessary to determine if there is a summer brood.
k. Snails shall be controlled before becoming epidemic. They can be anticipated as a menace from spring until the advent of high temperatures.
l. Contractor shall prevent the spread of disease by keeping all cutting edges sterile by dipping in an alcohol or bleach solution after each cut. m. Weeds must be removed upon appearance. Selective post-emergent herbicides shall be used to kill weeds without permanent injury to other plants.
n. Broadleaf weeds in turf shall be removed selectively, without injury to the lawn grass other than slight, temporary discoloration.
o. Grass weeds in lawns shall be controlled with selective post-emergent herbicides.
p. Creeping grasses shall be kept out of shrubs and groundcovers. q. Weeds not killed with herbicides shall be removed manually. Turf and other desirable plants killed by weeds, chemicals, etc., shall be replaced at the Contractor’s expense. All replacements must be made within 7 calendar days after receiving notice from the City.
r. Contractor shall be responsible for controlling weeds in the cracks and expansion joints of hardscape areas that are contiguous to maintained areas. Weed control in hardscape includes, but is not limited to, curb and gutter areas, sidewalks, sport courts, trails, parking lots, etc.
2. Application
O – Page 571 of 1107
(BB&K 2024) 40
a. City shall be notified prior to the application of pesticides and other chemicals. Pesticide applications shall be recorded on the Maintenance Schedule and coordinated with the Contract Administrator. Material Use Reports for all pesticides shall be filed with the City no later than the 10th day of every month for the preceding month.
b. Pesticides shall be applied at times which limit the possibility of contamination from climatic or other factors. Early morning application shall be used when possible, to avoid contamination from drift. Applicator shall monitor forecast weather conditions to avoid applications prior to inclement weather, to eliminate potential runoff in treated areas. c. Irrigation water applied after treatment shall be reduced to eliminate runoff. When water is required to increase pesticide efficiency, it shall be applied only in quantities of which the area is capable of absorbing without excessive runoff.
d. Care shall be taken in transferring and mixing pesticides to prevent contaminating areas outside the target area. Application methods shall be used which ensure that materials are confined to the target area.
Spray tanks containing leftover materials shall not be drained on the site.
Disposal of pesticides and tank rinsing materials shall be within the guidelines established in the State of California Food and Agricultural Code or EPA regulations.
e. Spray equipment shall be in good operating condition, quality, and design to efficiently apply materials to the target area. Spray drift from pesticide applications shall be minimized.
f. Wherever a specific type of material is specified, no substitutions shall be allowed without the written consent of the Contract Administrator. g. There shall be no application of a pesticide without written permission from the City.
h. There shall be no pesticides sprayed in the Monarch Butterfly Waystation located at the Animal Shelter.
3. Certification of Materials:
a. All materials shall be transported to the site in original containers.
Materials shall be subject to inspection by the Contract Administrator. b. The State of California Agricultural Code requires that pesticides and/or chemicals may be used only after a written recommendation by a State of California Licensed Pest Control Advisor is obtained, with a copy forwarded to the Contract Administrator prior to chemical usage. These recommendations shall be updated on a yearly basis. A recommendation consists of all the information the applicator should know for accurate and safe usage. The recommendation must be time and site specific. c. If a Restricted Use Pesticide is recommended, a use permit issued by the County of San Bernardino Agricultural Commissioner must be provided to the City.
O – Page 572 of 1107
(BB&K 2024) 41
d. All pesticides shall be applied only by an operator possessing a California state issued Qualified Applicator’s License or a Qualified Applicator’s Certificate.
M. Green Waste Disposal
1. Green waste shall be defined as tree and shrubbery trimmings, grass, weeds, leaves, woodchips and other garden organic materials.
2. Contractor shall be responsible for recycling all green waste generated from their contract performance.
3. Contractor shall have the duty to keep all green waste from being contaminated to an extent it no longer can be recycled.
4. Contractor shall deliver all green waste to a city approved reclamation site, for the purposes of recycling. Approved reclamation sites are:
5. Contractor shall submit a monthly report identifying the weight and/or volume of green waste recycled during the preceding month. Payment of maintenance invoice will not be made until green waste monthly report is completed and received by the City.
6. All debris resulting from any of the Contractor’s operations shall be removed and disposed of legally at the Contractor’s expense. No debris will be allowed to remain at the end of the workday. (Failure to remove and dispose of debris shall result in a liquidated damages charge of $100 to be deducted from the Contractor’s payment.)
7. All debris must be separated into green waste, recyclables, and other waste to minimize contamination and be disposed of in the appropriate locations. (Failure to separate and dispose of debris appropriately shall result in a liquidated damages charge of $100 to be deducted from the Contractor’s payment.)
N. General Clean-up
1. Litter / Debris Removal. All areas in the work sites shall be kept free of, but not limited to, the following items: bottles, glass, cans, paper, cardboard, metallic items, and other debris. In addition, dog feces are also to be removed from the walkways, turf or ground cover areas. Contractor shall promptly remove from the work area, all debris generated by their performance.
2. Policing of Areas. The Contractor shall ensure the maintained areas of all City Facilities are policed and have trash removed by 9:00 AM daily.
3. Curb and Gutter Maintenance. The Contractor is responsible for removal of all weeds and grass growing in and around the curb and gutter area. The Contractor is responsible to ensure the roadway is cleared of all dirt and debris within four (4) feet of the curb and gutter in all areas adjacent to maintenance responsibilities.
4. Walkway Maintenance. Walkways shall be cleaned immediately following mowing and edging and cleaned by use of power sweeping or blower equipment as per the schedule. This includes removal of all foreign objects from surfaces such as gum, glass, dog feces, and grease. All walkway cracks and expansion joints shall be always maintained weed and grass free. NOTE:
THE CITY HAS PROHIBITED THE USE OF GASOLINE LEAF BLOWERS,
O – Page 573 of 1107
(BB&K 2024) 42
THE CONTRACTOR SHALL ONLY USE ELECTRIC AND BATTERY
POWERED LEAF BLOWERS.
5. Drain Maintenance. All drains and catch basins shall be always kept free of siltation and debris. All v-ditches and drainage areas shall be kept clean and edged regularly by the Contractor.
6. Removal of Leaves. Accumulation of leaves shall be removed as required.
7. Removal of Damaged Plant Material. All dead, damaged, declining, hazardous or broken plant material (Trees, shrubs, palm fronts, palm husks vines, ground cover, turf), whether a result of the Contractor negligence, or an Act of God shall be removed by the Contractor at no additional cost to the City.
8. All trash, litter and debris shall be removed and disposed of daily and as requested by the Contract Administrator. The City provides on-site dumpster enclosures at some, but not all of the City’s Facilities for this purpose.
9. Contractor shall be responsible for the upkeep and cleanliness of the City’s onsite trash enclosures. This includes removal and disposal of illegally dumped debris inside of and around the exterior of the enclosures whenever scheduled services are provided, and when requested by the Contract Administrator. Any hazardous materials found in the trash enclosures must be left in place and reported immediately to the Contract Administrator.
10. Trash cans shall be emptied, and liners replaced daily. Trash cans shall be cleaned inside and out at least twice per week. All lids and City logos must be wiped clean at time of services or as requested by the Contract Administrator. The City reserves the right to relocate, add or delete trash cans within the various City facilities, at its discretion, and the Contractor shall adjust its services accordingly.
11. Trash can liners shall be replaced at the time of service. Contractor shall provide liners at the Contractor’s expense. Liner size shall be no smaller than 36” by 58”. Liner thickness shall be no less than 1.5 mil.
12. All sidewalks, trails, pathways, and hardscape areas contiguous to City landscape areas shall be swept, cleaned or hosed down daily, if necessary, to remove glass, sand/dirt, leaves, pine needles or any other debris that is hazardous to foot traffic or the intended use of the area.
O. Lighting Inspection
1. All security lighting and monument lighting systems shall be inspected for vandalism, safety hazards, and serviceability on a monthly basis.
Deficiencies shall be reported in writing immediately to the Contract Administrator.
P. Drinking Fountain Maintenance
1. All drinking fountains shall be inspected weekly and always kept clean and operational.
2. Every instance of damage, leaks, non-operation, etc., shall be reported to the Contract Administrator.
O – Page 574 of 1107
(BB&K 2024) 43
Q. Graffiti Removal
1. Contractor shall monitor daily for graffiti and promptly remove all graffiti as directed by the City. Graffiti eradication and control shall include all surfaces within each designated maintenance area and may include, but not be limited to, the following areas:
2. All materials and processes used in graffiti eradication shall be not injure surfaces or adjacent property and be approved by CAL-OSHA.
3. Appropriate surface preparation shall be made on painted walls and paint applied shall be the exact shade of color as existing paint, unless otherwise specifically approved by the Contract Administrator.
4. Contractor shall use special care and attention when removing graffiti from treated or sealed surfaces. Such surfaces shall not be painted unless instructed to do so. Contractor shall use materials and methods of application as provided and approved by the Contract Administrator.
5. Contractor shall not be required to sandblast walls or walkways but may be required to pressure wash surfaces.
6. Contractor shall immediately always remove all graffiti during the days and hours of operation when observed or within 24 hours when notified by the Contract Administrator
R. Liquidated Damages
1. Time is of the essence in the completion of the scope of service and associated tasks required by the Contract Documents. Each maintenance task or maintenance services is associated with a frequency of occurrence. These frequencies identified are as follows:
FREQUENCY ALLOTTED COMPLETION TIME
“A” Completed Daily, before 9:00 a.m.
“B” Completed Daily, before the close of business
“C” Completed Daily, before the close of business –
Monday through Friday Only
“D” Completed Twice weekly
“E” Completed Weekly before close of business on
Friday
“F” Completed Bi-weekly or 2x a month
“G” Completed Monthly or 12 times a year
“H” Completed Bi-monthly or six times a year
“I” Completed Quarterly or four times a year
“J” Completed Bi-annually or two times a year
“K” Completed annually
“L” As required
O – Page 575 of 1107
(BB&K 2024) 44
a. Tasks A through E are considered “regular” maintenance services. b. Tasks F through H are considered “periodic” maintenance services. c. Tasks I though L are considered “occasional” maintenance services.
2. If an individual task is not performed correctly or within required timelines, Contractor shall be considered to be in default. Once considered in default, liquidated damages may be assessed against Contractor on a per-task, sitespecific location basis until the default is corrected. The assessment shall be:
a. Fifty Dollars ($50) per occurrence for regular tasks; b. Two Hundred Fifty Dollars ($250) per occurrence for periodic tasks; and
c. Two Thousand Five Hundred Dollars ($2,500) per occurrence for occasional tasks.
3. The City may withhold from any monies payable on account of services performed by the Contractor any accrued liquidated damages.
1.3 Schedule:
A. Contractor shall begin work and shall proceed with all reasonable dispatch to completion. The Contractor will be required to maintain all areas in accordance with the contract documents. Work must be completed in consecutive days.
Inclement weather may result in the cancellation of certain landscape maintenance services only if the City Contract Manager or designee determines that there was insufficient time available for the services described to be performed.
B. The Contractor shall accomplish all normal landscape maintenance required under this contract between the hours of 7:00 AM and 3:30 PM, daily (or as otherwise required), for the Fall/Spring months (November through April), and between the hours of 6:00 AM and 2:30 PM, daily (or as otherwise required), for the Summer/Fall months (May through October). Exceptions may be made to normal working hours, where incidences of use may be too great during the hours specified to allow for proper maintenance. The City may grant, on an individual basis, permission to perform contract maintenance at other hours. No maintenance functions that generate excess noise which would cause annoyance to residents of any area shall be commenced before 8:00 AM. The Contractor shall establish a schedule of routine work to be followed in the performance of this contract.
C. The Contractor shall submit a weekly detailed job schedule, time sheet, names and titles of all persons working on the project within ten (10) days after the start of the maintenance contract. Materials and/or chemicals to be used on any site shall be approved by the City or their representative. The City shall be notified within five (5) working days of any deviation from this schedule or material usage.
D. The Contractor shall maintain and keep current a report form that records all ongoing, seasonal, and additional work maintenance functions performed daily by the Contractor’s personnel. Said report shall be in a form and content acceptable to the City and shall be submitted to the City upon request.
O – Page 576 of 1107
(BB&K 2024) 45
E. The City has the authority to cancel scheduled mowing cycles on a week to week basis. The cancellation will be based upon need and prevailing weather conditions.
1.4 Compensation:
A. Work will be compensated on a monthly basis. Contract pricing includes all labor, expenses, and incidentals to complete the work outlined in the contract scope. The Contractor may request monthly payments based on the percentage of work completed for the previous month if a detailed progress report is provided to support the amount requested. No additional compensation will be due by the City unless the contract is modified for additional work requested by the City. 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 to: [email protected]
B. Annual Allowance Included in Contract Price: Included in the Contractor’s bid price and the Contract Price is an annual allowance of Twenty-Five Thousand Dollars ($25,000) (the “Irrigation Parts Allowance”) for the cost of additional irrigation system parts required due to Normal Wear and Tear, Theft, and/or Vandalism (collectively, “Covered Causes”).
O – Page 577 of 1107
(BB&K 2024) 46
Appendix “A”
City Facility Information
Animal Shelter
Location: 4575 E. Mesquite Avenue
Total Area: 3.2 acres
Landscaped Area: 1.6 acres (including turf)
Turf Area: 0.1 acres
Trees: 42
Note: The Animal Shelter is irrigated with reclaimed water – requires appropriately certified Recycled Water Supervisor and compliance with state regulations on use of reclaimed water.
O – Page 578 of 1107
(BB&K 2024) 47
City Corporate Yard
Location: 425 N. Civic Drive
Total Area: 12.3 acres
Landscaped Area: 1.9 acres
Includes:
Julian Dr. east parkway
Alejo Rd. south parkway
Civic Dr. west parkway
Turf Area: 0
Trees: 92
O – Page 579 of 1107
(BB&K 2024) 48
Civic Easement
Location: North Civic Drive
Total area: 2.19 acres (94143.10 sqft)
Trees: 117
O – Page 580 of 1107
(BB&K 2024) 49
City Hall
Location: 3200 E. Tahquitz Canyon Way
Total Area: 6.5 acres
Landscaped Area: 2.0 acres (including turf)
Turf Area: 1.1 acres
Trees: 154
O – Page 581 of 1107
(BB&K 2024) 50
Demuth Community Center
Location: 3601 E. Mesquite Avenue
Total Area: 1.8 acres
Landscaped Area: 1.4 acres (including turf)
Turf Area: 0.3 acres
Trees: 73
O – Page 582 of 1107
(BB&K 2024) 51
Coachella Valley Economic Partnership (CVEP) Building
Location: 3111 E. Tahquitz Canyon Way
Total Area: 2.6 acres
(Includes two landscape parkway areas on west side of Civic Dr. as identified) Landscaped Area: 0.9 acres (including turf)
Turf Area: 0.6 acres
Trees: unknown
O – Page 583 of 1107
(BB&K 2024) 52
Fire Station #1 & Henry Frank Arcade Parking Lot
Location: 277 N. Indian Canyon Drive
Total Area: 1.3 acres
Landscaped Area: 0.9 acres
Turf Area: 0
Trees: unknown
O – Page 584 of 1107
(BB&K 2024) 53
Fire Station #2
Location: 300 N. El Cielo Road
Total Area: 1.6 acres
Landscaped Area: 0.3 acres
Turf Area: 0 acres
Trees: 23
O – Page 585 of 1107
(BB&K 2024) 54
Fire Station #3
Location: 590 E. Racquet Club Road
Total Area: 0.4 acres
Landscaped Area: 0.1 acres
Turf Area: 0 acres
Trees: 14
O – Page 586 of 1107
(BB&K 2024) 55
Fire Station #4
Location: 1300 S. La Verne Way
Total Area: 0.8 acres
Landscaped Area: 0.5 acres
Turf Area: 0 acres
Trees: 18
O – Page 587 of 1107
(BB&K 2024) 56
Fire Station #5
Location: 5800 Bolero Road
Total Area: 0.7 acres
Landscaped Area: 0.5 acres (including turf)
Turf Area: 0.4 acres
Trees: 14
O – Page 588 of 1107
(BB&K 2024) 57
Fire Training Facility
Location: 3000 E. Alejo Road
Total Area: 0.5 acres
Landscaped Area: 0.3 acres
(Includes Alejo Road parkway)
Turf Area: 0 acres
Trees: 7
O – Page 589 of 1107
(BB&K 2024) 58
Francis Stevens Park
500 N Palm Canyon Dr, Palm Springs, CA 92262
Total Area: 0.51 acre
Trees: 105
O – Page 590 of 1107
(BB&K 2024) 59
Household Hazardous Waste Disposal Facility
Location: 1100 S. Vella Road
Total Area: 1.2 acres
Landscaped Area: 0.9 acres
Turf Area: 0 acres
Trees: 15
O – Page 591 of 1107
(BB&K 2024) 60
Solar Field
Location: 4375 E Mesquite Ave
Total Area: 7.3 acres
Landscaped Area: 7.3 acres
Turf Area: 0 acres
Trees: 0
O – Page 592 of 1107
Palm Springs Access Center
Location: 225 S. El Cielo Road
O – Page 593 of 1107
(BB&K 2024) 61
Palm Springs Train Station
Location: N. Indian Canyon Drive at UPRR
Total Area: 3.7 acres
Landscaped Area: 1.3 acres
Turf Area: 0 acres
Trees: Unknown
O – Page 594 of 1107
(BB&K 2024) 62
Palm Springs Visitor’s Center
Location: 2901 N. Palm Canyon Drive
Total Area: 2.1 acres (includes Palm Springs Entry Sign and Tram Way medians)
Landscaped Area: 1.5 acres (including turf)
Turf Area: 0.1 acres
Trees: 42
O – Page 595 of 1107
(BB&K 2024) 63
Palm Springs Visitor’s Center CV Link
Location: 2901 N. Palm Canyon Drive
Landscape area: 0.3 acres
Trees : 13
O – Page 596 of 1107
(BB&K 2024) 64
Police Department
Location: 200 S. Civic Drive
Total Area: 3.9 acres
Landscaped Area: 0.9 acres (including turf)
Turf Area: 0.5 acres
Trees: 174
O – Page 597 of 1107
(BB&K 2024) 65
Police Department Equestrian Center
Location: 490 N. Civic Drive
Total Area: 0.1 acres (includes only the Alejo Road and Civic Drive parkways) Landscaped Area: 0.1 acres
Turf Area: 0 acres
Trees: 21
O – Page 598 of 1107
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
EEEAABEGBBJDE I GKKEL I
EAABEGBB CE I G EL IEA EG B EE I G EL I
EEDAABEGBBJCE I GKKEL IEEDAABEGBBJCE I GKKEL IEEEAABEGBBJDE I GKKEL I
EAABEGBB DE I G EL IEAABEGBB DE I G EL IEAABEGBB DE I G EL IEAABEGBB DE I G EL I
EEEAABEGBBJDE I GKKEL I
EAADEGBB DE I G EL IEAABEGBB DE I G EL IEEABEGBB EE I G EL IEE I G EL I
EEEAABEGBBJDE I GK EL I
EEBBEGBB EE I G EL I
EEEAABEGBBJCE I GKKEL I
DAABEGBB DE I G EL I
EEDAABEGBBJCE I GKKEL I
EAABEGBB EE I G EL I
Task No. Task Description of Task
1 14 Fertilization (turf and shrubs) Completed daily before 9:00am 2 Mechanical Edging 15 Cultivation (planters) / Cultivation (sand areas) Completed daily before close of business 3 Weed Control 16 renovation/vertical mowing Completed daily before close of business M - F 4 litter control 17 turf re-seeding Completed twice Weekly 5 Trash containers 18 disease / pest control Completed weekly before close of business on Fri 6 Trash bin removal 19 plant materials Completed bi-weeklyor 2x a month 7 Raking 20 locks and keys Completed monthly or 12 times a year 8 Pruning, hedge trimming Completed bi-monthly or six times a year 9 sweeping walkways Completed quaterly or four times a year 10 Graffiti eradication Completed bi-annually or two times a year 11 Aerification Completed annually
12 watering and irrigation maint./programing As required 13 Irrigation system testing
Household Hazardous Waste Disposal Facility
Palm Springs Train Station
Palm Springs Visitor's Center
Fire Station #1 & Henry Frank Arcade Lot
Fire Station #2
Palm Springs Access Center
Solar Field
Francis Stevens Park - Buildings
J
H
I
K
LF
G
D
E
BC
LEGEND Frequency
Mowing A
Palm Springs Visitor’s Center CV Link
Appendix “B” - FREQUNCY SCHEDULE
CITY FACILITIES - LANDSCAPE & GROUNDS MAINT.
Description of Task
Animal Shelter
City Corporate Yard
City Hall
Demuth Community Center
CVEP Building
Fire Station #3Fire Station #4
Police Department Equestrian Center
Police Department
Fire Station #5
Fire Training Facility
Civic Easement
O – Page 599 of 1107
(BB&K 2024) 66
EXHIBIT “B”
SCHEDULE OF COMPENSATION
O – Page 600 of 1107
ATTACHMENT G
BID FORM
INVITATION FOR BIDS (IFB 26-06)
LANDSCAPE AND GROUND MAINTENANCE SERVICES – CITY FACILITIES Responding to this IFB for Landscape and ground maintenance 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 Specifications 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, etc. that are not already included or incorporated in the below unit costs.
The initial Bid Price shall apply to the first year of the initial Contract Term, and will be adjusted annually on July 1 by the percentage change in the United States Bureau of Labor Statistics Employment Cost Index – Total Compensation, Table 6, Census Region and Division, West (Pacific), December to December, and a corresponding blended percentage increase to the applicable state prevailing wage rates for “Landscape Maintenance Laborer” as reviewed and approved by the City.
ITEM DESCRIPTION UNIT ESTIMATED
QUANTITY UNIT PRICE SUBTOTAL
1 Animal Shelter Monthly 36 $400 $14,400
2 City Corporate Yard Monthly 36 $3,050 $109,800
3 Civic Easement Monthly 36 $350 $12,600
4 City Hall Monthly 36 $3,000 $108,000
5 Demuth Community Center Monthly 36 $600 $21,600
6 CVEP Building Monthly 36 $600 $21,600
7 Fire Station #1 and Henry Frank
Arcade Lot
Monthly 36 $600 $21,600
8 Fire Station #2 Monthly 36 $600 $21,600
9 Fire Station #3 Monthly 36 $600 $21,600
10 Fire Station #4 Monthly 36 $600 $21,600
11 Fire Station #5 Monthly 36 $500 $18,000
12 Fire Training Facility Monthly 36 $500 $18,000
13 Francis Steven Park Monthly 36 $200 $7,200
14 Household Hazardous Waste
Disposal Facility
Monthly 36 $600 $21,600
15 Solar Field Monthly 36 $600 $21,600
16 Palm Springs Access Center Monthly 36 $500 $18,000
17 Palm Springs Train Station Monthly 36 $350 $12,600
18 Palm Springs Visitor’s Center Monthly 36 $600 $21,600 19 Palm Springs Visitors Center CV Link Monthly 36 $500 $18,000 20 Police Department Monthly 36 $2,000 $72,000
O – Page 601 of 1107
21 Police Department Equestrian Center Monthly 36 $300 $10,800 22 Annual Turf (Winter Rye Grass) ReSeeding (Animal Shelter) Acres 0.3 $0 $0 23 Annual Turf (Winter Rye Grass)
Re-Seeding (City Hall) Acres 3.3 $0 $0
24 Annual Turf (Winter Rye Grass)
Re-Seeding (Demuth Community
Center)
Acres 0.9 $0 $0
25 Annual Turf (Winter Rye Grass)
Re-Seeding (CVEP Building) Acres 1.8 $0 $0
26 Annual Turf (Winter Rye Grass)
Re-Seeding (Fire Station #5) Acres 1.2 $0 $0
27 Annual Turf (Winter Rye Grass)
Re-Seeding (Palm Springs Visitor’s
Center)
Acres 0.3 $0 $0
28 Annual Turf (Winter Rye Grass)
Re-Seeding (Police Department) Acres 1.5 $0 $0
29 Hourly Rate for additional work as
needed. Hourly 5,250 $18/hr $94,500
30 Parts and Materials % mark-up (Enter
the percentage in the unit price column
as a decimal figure: Example, for a 5%
markup, enter 1.05)
% 25,000 0.01% $25,250
TOTAL $733,550
Firm Name: Universal Green LLC
DIR Number: DIR Number 2000013861
Signature of Authorized Person:
Printed Name: Salvador Moreno
Title: Member
Date: 4/14/26
O – Page 602 of 1107
EXHIBIT "C"
ATTACHMENT “F”
EXECUTIVE ORDER N-6-22 CERTIFICATION
INVITATION FOR BIDS (IFB 26-06)
LANDSCAPE AND GROUND MAINTENANCE SERVICES – CITY FACILITIES 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 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) submits a bid or proposal or otherwise proposes to or enter into 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 entities 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 signing below is duly authorized to legally bind the Contractor. This certification is made under the laws of the State of California.
Signature:
Printed Name:
Title:
Firm Name:
Date:
Salvador Moreno
Member
Universal Green LLC
4/14/26
O – Page 603 of 1107
(BB&K 2024) 68
EXHIBIT “D”
PAYMENT AND PERFORMANCE BONDS
O – Page 604 of 1107
(BB&K 2024) 69
PERFORMANCE BOND
KNOW ALL PERSONS BY THESE PRESENTS:
THAT WHEREAS, the City of Palm Springs (hereinafter referred to as “City”) has awarded to ____________________, (hereinafter referred to as the “Contractor”) _______________________ an agreement for ______________________________ (hereinafter referred to as the “Project”).
WHEREAS, the work to be performed by the Contractor is more particularly set forth in the Contract Documents for the Project dated ________________, (hereinafter referred to as “Contract Documents”), the terms and conditions of which are expressly incorporated herein by reference; and
WHEREAS, the Contractor is required by said Contract Documents to perform the terms thereof and to furnish a bond for the faithful performance of said Contract Documents.
NOW, THEREFORE, we, _______________, the undersigned Contractor and _____________________________________________ as Surety, a corporation organized and duly authorized to transact business under the laws of the State of California, are held and firmly bound unto the City in the sum of ___________________________ DOLLARS, ($____________), said sum being not less than one hundred percent (100%) of the total amount of the Contract, for which amount well and truly to be made, we bind ourselves, our heirs, executors and administrators, successors and assigns, jointly and severally, firmly by these presents.
THE CONDITION OF THIS OBLIGATION IS SUCH, that, if the 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 Contract Documents and any alteration thereof made as therein provided, on its part, 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 all obligations including the one-year guarantee of all materials and workmanship; and shall indemnify and save harmless the City, its officers and agents, as stipulated in said Contract Documents, then this obligation shall become null and void; otherwise it shall be and remain in full force and effect.
As a condition precedent to the satisfactory completion of the Contract Documents, unless otherwise provided for in the Contract Documents, the above obligation shall hold good for a period of one (1) year after the acceptance of the work by City, during which time if Contractor shall fail to make full, complete, and satisfactory repair and replacements and totally protect the City from loss or damage resulting from or caused by defective materials or faulty workmanship, Surety shall undertake and faithfully fulfill all such obligations. The obligations of Surety hereunder shall continue so long as any obligation of Contractor remains. Nothing herein shall limit the City’s rights or the Contractor or Surety’s obligations under the Contract, law or equity, including, but not limited to, California Code of Civil Procedure section 337.15.
Whenever Contractor shall be, and is declared by the City to be, in default under the Contract Documents, the Surety shall remedy the default pursuant to the Contract Documents, or shall promptly, at the City’s option:
(1) Take over and complete the Project in accordance with all terms and conditions in the Contract Documents; or
(2) Obtain a bid or bids for completing the Project in accordance with all terms and conditions in the Contract Documents and upon determination by Surety of the lowest responsive and responsible bidder, arrange for a Contract between such bidder, the Surety and the City, and make available as work progresses sufficient funds to pay the cost of completion of the Project, less the balance of the contract price, including other costs and damages for which Surety may be liable. The term “balance of the contract price” as used in this paragraph shall mean the total
O – Page 605 of 1107
(BB&K 2024) 70
amount payable to Contractor by the City under the Contract and any modification thereto, less any amount previously paid by the City to the Contractor and any other set offs pursuant to the Contract Documents.
(3) Permit the City to complete the Project in any manner consistent with local, California and federal law and make available as work progresses sufficient funds to pay the cost of completion of the Project, less the balance of the contract price, including other costs and damages for which Surety may be liable. The term “balance of the contract price” as used in this paragraph shall mean the total amount payable to Contractor by the City under the Contract and any modification thereto, less any amount previously paid by the City to the Contractor and any other set offs pursuant to the Contract Documents.
Surety expressly agrees that the City may reject any contractor or subcontractor which may be proposed by Surety in fulfillment of its obligations in the event of default by the Contractor.
Surety shall not utilize Contractor in completing the Project nor shall Surety accept a bid from Contractor for completion of the Project if the City, when declaring the Contractor in default, notifies Surety of the City’s objection to Contractor’s further participation in the completion of the Project.
The Surety, for value received, hereby stipulates and agrees that no change, extension of time, alteration or addition to the terms of the Contract Documents or to the Project to be performed thereunder 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 Documents or to the Project, including but not limited to the provisions of sections 2819 and 2845 of the California Civil Code.
IN WITNESS WHEREOF, we have hereunto set our hands and seals this _______ day of ______________, 20__).
(Corporate Seal)
Contractor/ Principal
By
Title
(Corporate Seal)
Surety
By
Attorney-in-Fact
Signatures of those signing for the Contractor and Surety must be notarized and evidence of corporate authority attached.
(Attach Attorney-in-Fact Certificate) Title
The rate of premium on this bond is ____________ per thousand. The total amount of premium charges, $_______________________________.
(The above must be filled in by corporate attorney.)
O – Page 606 of 1107
(BB&K 2024) 71
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)
NOTE: A copy of the Power-of-Attorney authorizing the person signing on behalf of the Surety to do so must be attached hereto.
O – Page 607 of 1107
(BB&K 2024) 72
Notary 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 CALIFORNIA
COUNTY OF ______________
On , 20___, before me, _______________________________, Notary Public, personally
appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature of Notary Public
OPTIONAL
Though the information below is not required by law, it may prove valuable to persons relying on the document
and could prevent fraudulent removal and reattachment of this form to another document.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
Title(s) Title or Type of Document
Partner(s) Limited
General Number of Pages
Attorney-In-Fact
Trustee(s)
Guardian/Conservator Date of Document
Other:
Signer is representing:
Name Of Person(s) Or Entity(ies)
Signer(s) Other Than Named Above
O – Page 608 of 1107
(BB&K 2024) 73
PAYMENT BOND
KNOW ALL MEN BY THESE PRESENTS That
WHEREAS, the City of Palm Springs (hereinafter designated as the “City”), by action taken or a resolution passed ___________ , 20____has awarded to ________________ hereinafter designated as the “Principal,” a contract for the work described as follows:
_____________________________________________________ (the “Project”); and WHEREAS, the work to be performed by the Principal is more particularly set forth in the Contract Documents for the Project dated __________________ (“Contract Documents”), the terms and conditions of which are expressly incorporated by reference; and WHEREAS, said Principal is required to furnish a bond in connection with said contract; providing that if said Principal or any of its Subcontractors shall fail to pay for any materials, provisions, provender, equipment, or other supplies used in, upon, for or about the performance of the work contracted to be done, or for any work or labor done thereon of any kind, or for amounts due under the Unemployment Insurance Code or for any amounts required to be deducted, withheld, and paid over to the Employment Development Department from the wages of employees of said Principal and its Subcontractors with respect to such work or labor the Surety on this bond will pay for the same to the extent hereinafter set forth.
NOW THEREFORE, we, the Principal and __________________________ as Surety, are held and firmly bound unto the City in the penal sum of ______________ Dollars ($___________) lawful money of the United States of America, for the payment of which sum 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 Principal, his or its subcontractors, heirs, executors, administrators, successors or assigns, shall fail to pay any of the persons named in Section 9100 of the Civil Code, fail to pay for any materials, provisions or other supplies, used in, upon, for or about the performance of the work contracted to be done, or for any work or labor thereon of any kind, or amounts due under the Unemployment Insurance Code with respect to work or labor performed under the contract, or for any amounts required to be deducted, withheld, and paid over to the Employment Development Department or Franchise Tax Board from the wages of employees of the contractor and his subcontractors pursuant to Section 18663 of the Revenue and Taxation Code, with respect to such work and labor the Surety or Sureties will pay for the same, in an amount not exceeding the sum herein above specified, and also, in case suit is brought upon this bond, all litigation expenses incurred by City in such suit, including reasonable attorneys’ fees, court costs, expert witness fees and investigation expenses.
This bond shall inure to the benefit of any of the persons named in Section 9100 of the Civil Code so as to give a right of action to such persons or their assigns in any suit brought upon this bond.
It is further stipulated and agreed that the Surety on this bond shall not be exonerated or released from the obligation of this bond by any change, extension of time for performance, addition, alteration or modification in, to, or of any contract, plans, specifications, or agreement pertaining or relating to any scheme or work of improvement herein above described, or pertaining or relating to the furnishing of labor, materials, or equipment therefore, nor by any change or modification of any terms of payment or extension of the time for any payment pertaining or relating to any scheme or work of improvement herein above described, nor by any rescission or attempted rescission of the contract, agreement or bond, nor by any conditions precedent or subsequent in the bond attempting to limit the right of recovery of claimants otherwise entitled to recover under any such contract or agreement or under the bond, nor by any fraud practiced by any person other than the claimant seeking to recover on the bond and that this bond be construed most strongly against the Surety and in favor of all persons for whose benefit such bond is given, and under no circumstances shall Surety be released from liability to those for whose benefit such bond has been given, by reason of any breach of contract between the owner or City and original
O – Page 609 of 1107
(BB&K 2024) 74
contractor or on the part of any obligee named in such bond, but the sole conditions of recovery shall be that claimant is a person described in Section 9100 of the Civil Code, and has not been paid the full amount of his claim and that Surety does hereby waive notice of any such change, extension of time, addition, alteration or modification herein mentioned and the provisions of sections 2819 and 2845 of the California Civil Code.
IN WITNESS WHEREOF, we have hereunto set our hands and seals this _______ day of ______________, 20__.
(Corporate Seal)
Contractor/ Principal
By
Title
(Corporate Seal) Surety
By
Attorney-in-Fact
Title
Signatures of those signing for the Contractor and Surety must be notarized and evidence of corporate authority attached. A Power-of-Attorney authorizing the person signing on behalf of the Surety to do so much be attached hereto.
NOTE: A copy of the Power-of-Attorney authorizing the person signing on behalf of the Surety to do so must be attached hereto.
O – Page 610 of 1107
(BB&K 2024) 75
Notary 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 CALIFORNIA
COUNTY OF ______________
On , 20___, before me, _______________________________, Notary Public, personally
appeared , who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature of Notary Public
OPTIONAL
Though the information below is not required by law, it may prove valuable to persons relying on the document
and could prevent fraudulent removal and reattachment of this form to another document.
CAPACITY CLAIMED BY SIGNER DESCRIPTION OF ATTACHED DOCUMENT Individual
Corporate Officer
Title(s) Title or Type of Document
Partner(s) Limited
General Number of Pages
Attorney-In-Fact
Trustee(s)
Guardian/Conservator Date of Document
Other:
Signer is representing:
Name Of Person(s) Or Entity(ies)
Signer(s) Other Than Named Above
O – Page 611 of 1107
ATTACHMENT “B”
Public Integrity Disclosure
O – Page 612 of 1107
PUBLIC INTEGRITY DISCLOSURE
APPLICANT DISCLOSURE FORM
1. Name of Entity
2. Address of Entity (Principal Place of Business)
3. Local or California Address (if different than #2)
4. State where Entity is Registered with Secretary of State If other than California, is the Entity also registered in California? Yes No
5. Type of Entity
Corporation Limited Liability Company Partnership Trust 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
________________________ Officer Director Member Manager
[name] General Partner Limited Partner
Other
___________________________
_______________________________ Officer Director Member Manager [name] General Partner Limited Partner
Other
__________________________
________________________________ Officer Director Member Manager Universal Green LLC
17989 Corkill Rd #63, Desert Hot Springs, CA 92241
California
Salvador Moreno
Sarita Y Ramos Rodriguez
Raymundo Vega
O – Page 613 of 1107
[name] General Partner Limited Partner
Other
__________________________
7. Owners/Investors with a 5% beneficial interest in the Applicant Entity or a related entity
EXAMPLE
JANE DOE
[name of owner/investor]
50%, ABC COMPANY, Inc.
[percentage of beneficial interest in entity
and name of entity]
A.
[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 Salvador Moreno
Sarita Y Ramos Rodriguez
Raymundo Vega
33.33%
33.33%
33.33%
Salvador Moreno, Member 4/14/26
O – Page 614 of 1107
CITY COUNCIL STAFF REPORT
DATE: MAY 27, 2026 CONSENT CALENDAR
SUBJECT: ESTABLISH A POLICY MANDATING AN INDEPENDENT AUDITING
FIRM TO CONDUCT AN AUDIT EVERY TWO FISCAL YEARS FOR CITY
GRANTS AND CONTRACTS
FROM: Scott C. Stiles, City Manager
BY: Department of Finance and Treasury
SUMMARY:
On June 23, 2025, the City of Palm Springs received a Riverside County Civil Grand Jury report with a recommendation (R7) that the Palm Springs City Council establish a policy by June 30, 2026, that mandates an independent auditing firm to conduct an internal operational audit (key processes, procedures, and internal controls) every two fiscal years (Attachment A).
RECOMMENDATION:
By motion, approve a policy mandating an independent auditing firm conduct an internal operational audit over City-funded grants and contracts (key processes, procedures, and internal controls) every two fiscal years.
BACKGROUND:
On June 23, 2025, the Riverside County Grand Jury issued its report entitled “City of Palm Springs Lacked Proper Procedures for Vetting and Monitoring of Grants” (“Report”). The Report focuses on the alleged lack of adequate policies and procedures for processing and monitoring grants and contracts to ensure public funds are used appropriately. This investigation was initiated at the request of the District Attorney after the indictment of the CEO of Queer Works. The City entered a Memorandum of Understanding with Queer Works and Desert AIDS Project to provide financial support for the purpose of conducting due diligence in pursuing a State grant for a possible guaranteed income pilot program targeting transgender and/or non-binary individuals.
On September 10, 2025, a staff report was brought before City Council to approve the response to the Riverside County Civil Grand Jury that accompanies this staff report as Attachment A.
P – Page 615 of 1107
City Council Staff Report
May 27, 2026 -- Page 2
Approval of an Audit of City Grants and Contracts Every Two Years ENVIRONMENTAL ASSESSMENT:
None.
ALIGNMENT WITH STRATEGIC PLANNING:
This item aligns with the City Council’s Strategic Plan Broad Goal of Public Safety and Community Services, and the Foundation of Financial and Organizational Well-Being.
FISCAL IMPACT:
The estimated annual cost associated with implementing an independent audit is $24,000.
REVIEWED BY:
Department Director: Kristopher J. Mooney
City Manager: Scott Stiles
ATTACHMENTS:
A. Staff Report Approving Response to Civil Grand Jury Report
P – Page 616 of 1107
ATTACHMENT A
Staff Report Approving
Response to Civil
Grand Jury Report
P – Page 617 of 1107
CITY COUNCIL STAFF REPORT
DATE: SEPTEMBER 10, 2025 CONSENT CALENDAR
SUBJECT: APPROVE RESPONSE TO CIVIL GRAND JURY REPORT
FROM: Scott C. Stiles, City Manager
BY: City Attorney’s Office
SUMMARY:
On June 23, 2025, the City of Palm Springs received a Riverside County Civil Grand Jury report. The report entitled “City of Palm Springs Lacked Proper Procedures for Vetting and Monitoring of Grants” accompanies this staff report as Attachment A. The report was made available to the public after the close of business on June 26, 2025.
This agenda item provides the City Council with an opportunity to review the report and provide the City’s response, as provided for under California law.
RECOMMENDATION:
It is recommended the City Council review the accompanying civil grand jury report, approve the response, and authorize the City Manager to deliver the City’s written response to the Grand Jury Report.
BACKGROUND:
Every year, a group of citizens agree to voluntarily serve as civil grand jurors. The civil grand jury is separate and apart from a criminal grand jury, which investigates potential crimes. This agenda item involves the civil grand jury; not a criminal grand jury. In California, civil grand juries are authorized to “investigate and report upon the operations, accounts, and records of the officers, departments, functions, and the method or system of performing the duties of any such city or joint powers agency and make such recommendations as it may deem proper and fit.” (Cal. Penal Code §925(a).) Each civil grand jury determines which officers, departments and agencies it will review.
Once a civil grand jury issues a report to a local public agency, a response is due from that agency within 90 days after issuance of the report. Most civil grand jury reports contain two sections: findings and recommendations. The City Council must address the findings (Cal. Penal Code § 933.05(a)) and recommendations (Cal. Penal Code § Item 1X - Page 1
P – Page 618 of 1107
933.05(b)) to the Presiding Judge of the Superior Court, the Riverside County Grand Jury office, and the Riverside County Clerk-Recorder.
As to each grand jury finding, the City must indicate one of the following:
• The City agrees with the finding; or
• The City disagrees wholly or partially with the finding, in which case the response must specify the portion of the finding that is disputed and must include an explanation of the reasons therefor.
As to each grand jury recommendation, the City must respond with one of the following actions:
• The recommendation has been implemented, with a summary regarding the implemented action; or
• The recommendation has not yet been implemented, but will be implemented in the future, with a timeframe for implementation; or • The recommendation requires further analysis, with an explanation and the scope and parameters of an analysis or study, and a timeframe for the matter to be prepared for discussion by the City Council. This timeframe must not exceed six (6) months from the date of publication of the grand jury report; or
• The recommendation will not be implemented because it is not warranted or is not reasonable, along with the City’s explanation.
STAFF ANALYSIS:
On June 23, 2025, the Riverside County Grand Jury issued its report entitled “City of Palm Springs Lacked Proper Procedures for Vetting and Monitoring of Grants” (“Report”). The Report focuses on the alleged lack of adequate policies and procedures for processing and monitoring grants and contracts to ensure public funds are used appropriately. This investigation was initiated at the request of the District Attorney after the indictment of the CEO of Queer Works. The City entered into a Memorandum of Understanding with Queer Works and Desert AIDS Project to provide financial support for the purpose of conducting due diligence in pursuing a State grant for a possible guaranteed income pilot program targeting transgender and/or non-binary individuals.
Below are the civil grand jury’s findings and recommendations, each of which is followed by City staff’s recommended responses. Per State statute, the City’s response is due no later than September 24, 2025.
FINDINGS
F1. The City of Palm Springs lacked comprehensive guidelines and procedures for processing and monitoring grants and contracts. This absence of clear rules or standards did lead to inefficiencies, mismanagement, and misuse of funds.
Item 1X - Page 2
P – Page 619 of 1107
F1 Response: The City agrees with this finding. In response to the Queer Works matter, City staff developed a set of grant management and fund disbursement processes and protocols, which was approved by the City Council at its meeting of November 21, 2024. The new processes serve to increase accountability and create fiscal safeguards around the distribution of City funds for grants and sponsorships.
F2. There is no formal training in fraud prevention or detection for those responsible for reviewing grant claims in the City of Palm Springs.
F2 Response: The City agrees with this finding; however, the City is currently working with the City Attorney’s office to schedule formal fraud prevention training to City staff, which will be implemented by December 31, 2025.
F3. The City Council of Palm Springs did not request the monthly reports and invoices as required by the Memorandum of Understanding contract with Queer Works and Desert Aids Project (DAP) Health of Palm Springs.
F3 Response: The City disagrees with this finding. The City requested invoices and progress reports and issued the first $200,000 in several payments with varying amounts.
F4. The Memorandum of Understanding contract allowed for two large lump sums payments.
F4 Response: The City disagrees with this finding. The City paid out the first $200,000 authorized by the City Council in several payments with varying amounts based on invoices and progress reports sent.
F5. The City of Palm Springs lacked proper auditing procedures, reviews, and monthly updates from a Non-Governmental Organization.
F5 Response: The City disagrees with this finding. The City did and does possess proper auditing procedures and reviews. In response to concerns raised about Queer Works in late 2023, the City requested the proper data to audit the program numerous times. However, despite repeated requests, Queer Works did not send the necessary data for the City to conduct an audit.
F6. The City of Palm Springs heavily relied upon the endorsement by Desert AIDS Project (DAP) Health of Palm Springs to approve the Queer Works grant.
F6 Response: The City agrees with this finding.
F7. A City Council Member informed the Palm Springs City Council of their suspicion regarding Queer Works’ possible wrongdoing.
Item 1X - Page 3
P – Page 620 of 1107
F7 Response: The City disagrees with this finding. A City Council member informed City Staff of their suspicion of Queer Works possible wrongdoing. This information led City Staff to seek an audit of the Queer Works program.
F8. The receipts submitted by Queer Works revealed inconsistencies in their financial statements to the City of Palm Springs.
F8 Response: The City disagrees with this finding. The City never received financial statements from Queer Works.
F9. The City of Palm Springs’ inadequate oversight resulted in a loss of over $700,000.
F9 Response: The City disagrees with this finding. DAP Health was able to complete the pilot program, and the City is unable to reconcile a specific amount of loss.
RECOMMENDATIONS
R1. The Riverside County Civil Grand Jury recommends that the Palm Springs City Council develop comprehensive guidelines and procedures for processing and monitoring grants and contracts, implemented no later than December 31, 2025.
R1 Response: This recommendation has been implemented. At the Palm Springs City Council meeting of November 21, 2024, the City Council approved a new set of grant management and fund disbursement processes and protocols to strengthen the City’s process related to grants and sponsorships, that would apply to any organization requesting funds directly from the City Council, either during the course of the budget process or raised at a City Council meeting. The new policy changes outlined seven areas of improvement and provided actionable recommendations to address them. See Attachment B.
R2. The Riverside County Civil Grand Jury recommends that the Palm Springs City Council mandate annual fraud detection training for city employees who monitor grants and contracts, implemented no later than December 31, 2025.
R2 Response: This recommendation is in the process of being implemented by the City. The City is currently working with the City Attorney’s office to schedule formal fraud prevention training to City staff, which will be implemented by December 31, 2025.
R3. The Riverside County Civil Grand Jury recommends that the Palm Springs City Council ensure all contract Non-Governmental Organizations receiving funding above $50,000 have the payments distributed in multiple installments, to be implemented no later than December 31, 2025.
R3 Response: This recommendation has been implemented. As outlined in the City’s Processes and Procedures for City Grant Management and Funds Item 1X - Page 4
P – Page 621 of 1107
Disbursement approved by City Council on November 21, 2024, the approved policy eliminates lump sum payments for any grant funding of $75,000 or greater.
The City used the threshold of $75,000 as that amount was the limit of the City Manager’s signature authority. Any payment of $75,000 or greater must be split into a minimum of two payments, with each payment distributed at least three months apart.
R4. The Riverside County Civil Grand Jury recommends that the Palm Springs City Council establish clearly defined written vetting processes for city employees to use when evaluating Non-Governmental Organization program proposals, to be implemented no later than December 31, 2025.
R4 Response: This recommendation has been implemented. As outlined in the City’s Processes and Procedures for City Grant Management and Funds Disbursement approved by City Council on November 21, 2024, there is a vetting process for organizations seeking City grant funding. Funding recipients must meet minimum eligibility requirements which includes:
1. Be located in the City of Palm Springs or provide services to Palm Springs residents.
2. Meet the definition of a Nonprofit Organization and provide the organization’s IRS 501(c) tax designation letter.
3. Provide a list of board members (required by the California Attorney General’s Registry of Charitable Trusts) to confirm legitimacy.
4. Have the ability to provide the organization’s 990 and 990-F federal tax returns and/or audited financial statements.
5. Include documentation on disbursement and check approval processes.
6. Possess a valid City of Palm Springs Business License, as applicable.
7. Be found in good financial standing with the City of Palm Springs.
8. Be found in good legal standing.
9. Provide a proposal that will benefit those living in the City of Palm Springs.
10.Meet all criteria outlined in the grant application.
11.Compliance with all applicable federal, state, and local laws, statutes and ordinances, and all lawful orders, rules and regulations when performing grant-funded services.
12.Grantee shall not discriminate against any employee or applicant per the provisions of the Palm Springs Municipal Code Section 7.09.040.
13.The City should not be the primary source of funding for the organization.
All nonprofit organizations, including those with whom the City has historically partnered, must meet minimum eligibility requirements, be in compliance with and in good standing with the following agencies:
• IRS Verified Nonprofit Status
• California Secretary of State
• California Department of Justice, Attorney General’s Registry of Charitable Trusts
• California Franchise Tax Board
Item 1X - Page 5
P – Page 622 of 1107
• City Department of Finance
• City Code Enforcement
R5. The Riverside County Civil Grand Jury recommends that the Palm Springs City Council review and redefine its policies and procedures related to making lump sum payments to the Non-Governmental Organization programs including assessing associated risks, to be implemented by December 31, 2025.
R5 Response: This recommendation has been implemented. As outlined in the City’s Processes and Procedures for City Grant Management and Funds Disbursement approved by City Council on November 21, 2024, the approved policy eliminates lump sum payments for any grant funding of $75,000 or greater.
The City used the threshold of $75,000 as that amount was the limit of the City Manager’s signature authority. Any payment of $75,000 or greater must be split into a minimum of two payments, with each payment distributed at least three months apart.
R6. The Riverside County Civil Grand Jury recommends that the Palm Springs City Council hire an independent auditing firm to conduct an internal operational audit (key processes, procedures, and internal controls) and provide improvement suggestions to the Palm Springs City Council by June 30, 2026.
R6 Response: The City agrees with this recommendation and will work to engage an auditing firm to initiate this engagement by the requested date.
R7. The Riverside County Civil Grand Jury recommends that the Palm Springs City Council establish a policy that mandates an independent auditing firm to conduct an internal operational audit (key processes, procedures, and internal controls) every two fiscal years by June 30, 2026.
R7 Response: The City agrees with this recommendation and will prepare a policy for City Council approval by the requested date.
R8. The Riverside County Civil Grand Jury recommends that the Palm Springs City Council review and update its policies, regulations, and procedures related to its fraud, waste, and misuse hotline (i.e., “Whistleblower Hotline”) by December 31, 2025.
R8 Response: The City agrees with this recommendation.
R9. The Riverside County Civil Grand Jury recommends that the Palm Springs City Council utilize various media channels to announce, at least quarterly, the purpose and availability of its city “Whistleblower Hotline” no later than December 31, 2025.
R9 Response: The City agrees with this recommendation.
Item 1X - Page 6
P – Page 623 of 1107
R10. The Riverside County Civil Grand Jury recommends that the Palm Springs City Council contract with an independent firm to conduct a forensic audit of all city departments vetting and monitoring contracts and grants no later than June 30, 2026.
R10 Response: The City will not implement this recommendation. The City feels this recommendation is not warranted or reasonable but instead is excessive due to the implementation of additional audits that will cover internal controls for the monitoring and vetting of grants. (See Responses R6 and R7).
ENVIRONMENTAL ASSESSMENT:
There is no potential for any environmental impact associated with this report.
ALIGNMENT WITH STRATEGIC PLANNING:
The response to the civil grand jury aligns with the City Council’s major themes/principles of optimizing basic services and facilities and focusing on issues that most impact quality of life.
FISCAL IMPACT:
There is no direct fiscal impact associated with responding to the Grand Jury Report.
REVIEWED BY:
Director of Finance & Treasurer: Kristopher J. Mooney
City Attorney: Jeffrey S. Ballinger
City Manager: Scott Stiles
ATTACHMENTS:
A. Riverside County Civil Grand Jury 2024-2025 report: “City of Palm Springs Lacked Proper Procedures for Vetting and Monitoring of Grants,” dated June 16, 2025.
B. City of Palm Springs Staff Report of November 21, 2024, Updating Processes and Procedures for City Grant Management and Funds Disbursement.
Item 1X - Page 7
P – Page 624 of 1107
ATTACHMENT A
Item 1X - Page 8
P – Page 625 of 1107
Riverside County Civil Grand Jury 2024-2025
June 16, 2025
City of Palm Springs
Lacked Proper Procedures for Vetting
and Monitoring of Grants
Item 1X - Page 9
P – Page 626 of 1107
1 SUMMARY
Following the indictment of the CEO of Queer Works (QW), a nonprofit organization, on 53 criminal counts, the District Attorney requested that the Riverside County Civil Grand Jury (RCCGJ) investigate potential government malfeasance or misconduct in the administration of these contracts. The RCCGJ found evidence that the City of Palm Springs lacked adequate policies and procedures to safeguard taxpayer funds from fraudulent use by nonprofits.1
BACKGROUND
Mayors for a Guaranteed Income (MGIP) was founded in June, 2020 by Stockton, California Mayor Michael Tubbs. It is, generally, an anti-poverty program. Its purpose is for City Mayors to come together in a network to advocate for a Guaranteed Income “To lift all the communities and build a resilient, just America”.2
On March 24, 2022, in the City Council of Palm Springs considered and approved a request by Desert Aids Project (DAP) Health, a non-profit organization and Queer Works (QW), a nonprofit corporation, to provide financial support for the purpose of pursuing a State grant for an income pilot program or Universal Basic Income (UBI) program.3 This UBI program was to support transgender and nonbinary individuals with support for employment, homelessness, assault and discrimination.4
The MGIP program provides a monthly cash payment given directly to individuals to help supplement their income or lack thereof. MGIP’s are a way to test the impact of these payments, while also providing a service to help financially stabilize community members and acquire information to help create future, evidence-based policies, and programs. The City Council of Palm Springs on March 24, 2022, initially approved $200,000 by signing a Memorandum of Understanding (MOU) between DAP and QW. It was also understood that an additional $500,000 would be issued if QW met the requirements of the initial MOU from the City.
In late 2023, a Palm Springs City Council member became concerned with the activities of QW and the lack of required financial information reporting to the City. 1 Grand jury indicts Queer Works CEO on multiple fraud charges ⋆ The Palm Springs Post 2 About — Mayors for a Guaranteed Income
3 City Council - Mar 24 2022 : City of Palm Springs, CA : Free Download, Borrow, and Streaming : Internet Archive
4 Guaranteed Income Pilot Program
Item 1X - Page 10
P – Page 627 of 1107
2 WHAT IS DAP HEALTH & MISSION?
“For four decades, DAP Health has remained committed to its founding principles based on equitable access to health care. Guided by the voices and needs of the diverse communities it serves, the nonprofit has protected and expanded access to quality programs and services for people of all ages, genders, ethnicities, orientations, and socioeconomic statuses”.
5 HISTORY OF QUEER WORKS AKA QUEERWORKS: MISSION STATEMENT “Queer Works was originally formed in 2018. Queer Works was founded and is led by Jacob Rostovsky, MA, LMFT. Jacob is a therapist and an out transgender man whose personal experiences facing rejection and discrimination in healthcare inspired the creation of the organization. We are based completely virtual throughout California.
In 2024, we have decided to move our mission completely towards mental health care and access for the TGI community.
Our primary focus is our free mental health program designed to promote health equity within the transgender and gender non-binary (TGI) community. We aim to provide accessible mental health services by connecting TGI individuals with licensed therapists who have expertise in working with the community's unique needs.
The therapy services we offer are available for free to those who are unable to afford them. Our program also includes support groups and workshops to promote mental wellness and community-building among TGI individuals.
At Queer Works, we understand the unique challenges that TGI individuals face when seeking mental health services. Our goal is to empower the community by providing the support and resources they need to take control of their mental health and advocate for their well-being”.
6 Definition for the acronym TGI:
Transgender, Transsexual, Gender-Diverse, and Intersex (TGI): This term encompasses a range of identities, including male-to-female (MtF), female-to-male (FtM), and others, indicating that the assigned sex at birth may not accurately describe one's gender identity1.7 5 About Us - DAP Health
6 About Queer Works — Queer Works & The TransPower Project 7 TGI Network of RI - What is TGI?
Item 1X - Page 11
P – Page 628 of 1107
3 METHODOLOGY
The Civil Grand Jury obtained information for this report through the review of documents, testimony of officials, site visitations and websites.
Interviews-The Riverside County Civil Grand Jury conducted 14 interviews • 2022 Palm Springs City Council Members
• 2022 Palm Springs City Manager
• 2024 Palm Springs City Council Members
• 2024 Palm Springs City Manager
• 2024 Palm Springs Director of Finance & Treasurer
• 2024 Palm Springs Chief Deputy Clerk
• 2024 Palm Springs City Attorney
• CEO of Desert Aids Project (DAP) Health Palm Springs
• Staff Members County of Riverside - Housing and Workforce Solutions • Forensic Accountant
Documents
• March 24, 2022, Palm Springs City Council Meeting approves $200,000 in funding to Desert Aids Project and Queer Works to submit a proposal for State Funding of a Universal Basic Income program.
• May 12, 2022, Memorandum of Understanding Between the City of Palm Springs, Desert Aids Project and Queer Works was signed.
• July 28, 2022, Palm Springs City Council board meeting approved an additional $500,000 in funding to Desert Aids Project and Queer Works. • October 5, 2022, the First Amendment to the Memorandum of Understanding between the City of Palm Springs and Queer Works was signed.
• July 11, 2024, Agreement of Separation between Queer Works and the City of Palm Springs.
• July 11, 2024, Agreement Desert Aids Project to assume all obligations of Queer Works under Universal Basic Income program.
• 2022-2024, City of Palm Springs Invoices received from Queer Works for payment. • 2022-2024, Palm Springs City Council Staff Reports.
• 2022-2024, Multiple Palm Springs City documents.
• County of Riverside Department of Housing, Homelessness Prevention and Workforce Solutions (HHPWS). Queer Works Trans Power Project-Street Outreach ESC-CV2, HHPWSCoC-ESGCV2-13.
• Mayors for a Guaranteed Income (MGIP).
• Form 990 Return of Organization Exempt from Income Tax 2022 Queer Works.
Item 1X - Page 12
P – Page 629 of 1107
4 • Form 990 Returns of Organization Exempt from Income Tax 2022 and 2023 Desert Aids Project.
Palm Springs City Council Online Meetings
• City Council Meeting: March 24, 2022
• City Council Meeting: May 12, 2022
• City Council Meeting: July 28, 2022
• City Council Meeting: November 9, 2023
Visits
• Palm Springs City Hall
• Desert Aids Project (DAP) Palm Springs
Subpoena
• Two issued
Websites
• City of Palm Springs:
o Government | City of Palm Springs
• City of Palm Springs City Council Meetings:
o https://www.palmspringsca.gov/Home/Components/Calendar/Event/23820/1 464?npage=5
o https://www.palmspringsca.gov/Home/Components/Calendar/Event/24258/1 464?npage=4
• The Palm Springs Post Press release February 27, 2023- Queer Works and Dap Health join forces with the City of Palm Springs to launch Universal Basic Income Program:
o Applications for basic income pilot project opening in mid-March; members of transgender, non-binary community especially encouraged to apply ⋆ The Palm Springs Post
• Palm Springs seeks to tighten nonprofit grant controls after pilot program issues:
o Palm Springs seeks to tighten nonprofit grant controls after pilot program issues ⋆ The Palm Springs Post
• Public Announcement by District Attorney Office:
o CRIMINAL GRAND JURY INDICTS NONPROFIT CEO ON 53 FELONY
COUNTS IN FRAUD SCHEME INVOLVING THEFT OF MORE THAN
$940,000 IN PUBLIC FUNDS | Riverside County District Attorney Item 1X - Page 13
P – Page 630 of 1107
5 • Queer Works 990 form for 2022:
o Queer Works - Form 990, Schedule A - Nonprofit Explorer - ProPublica • DESERT AIDS PROJECT, INC. DBA DAP HEALTH INC 990 forms for 2023 and 2024:
o Dap Health Inc - Nonprofit Explorer - ProPublica
DISCUSSION
In March 2022 the Palm Springs City Council approved a request to allocate $200,000 in financial support to pursue a State grant for a potential Universal Basic Income Project.8 The program aimed to secure state funding from the $35 million allocated in 2021 for guaranteed income programs across California, with an expected launch between October 2022 and February 2023.9 Palm Springs residents could apply for the city's Universal Basic Income pilot program, which would provide 30 residents with a monthly cash payment of $800 for 18 months.
Additionally, the program would offer some transgender and nonbinary residents a monthly payment as part of a guaranteed basic income pilot initiative.
In May 2022 all parties entered a Memorandum of Understanding (MOU) in which the City of Palm Springs agreed to provide up to $200,000 for operational costs necessary for the startup of the project, on a reimbursement basis.10 On July 28, 2022, the Palm Springs City Council approved a request for a First Amendment to the existing MOU, adding an additional $500,000.11 Interviews revealed that both MOU contracts were approved and signed by the Palm Springs City Attorneys.
In late 2023, a Palm Springs Council member raised concerns about the activities of Queer Works and the lack of required reporting documents to the City, as agreed upon in the MOU by QW and DAP. The agreement included the following commitments:
1. Exercise good faith to remain within the estimated budget
2. Keep the City apprised of changes made to the program, state grant opportunities, fundraising and other information pertinent to execution of the scope of work
3. Provide the City Manager with monthly updates, unless otherwise indicated in writing by the City Manager, outlining activities and progress.
8 City Council - Mar 24 2022 : City of Palm Springs, CA : Free Download, Borrow, and Streaming : Internet Archive
9 2021 toward guaranteed income programs across California with an expected launch between October and February 2023. - Search
10 Palm Springs funds universal basic income effort for trans residents 11 City Council Regular Meeting | City Council Agenda Archive | City of Palm Springs Item 1X - Page 14
P – Page 631 of 1107
6 The RCCGJ discovered through multiple interviews that the Palm Springs City Council ceased receiving financial updates or progress reports from either QW or DAP after the specified date, as per the MOU agreement. Online correspondence was sent to both QW and the CEO of DAP, expressing concerns about the handling of funds and requesting updates on the progress of the pilot program. The City of Palm Springs received a total of six progress reports starting from 2022, with the last report dated April 12, 2023.
The RCCGJ discovered that a call took place on May 23, 2022, between a Palm Springs Council Member and a DAP staff member, regarding concerns about QW operations. The DAP member informed the council member that no evidence of wrongdoing was found. Subsequently, the RCCGJ's investigation discovered that the City of Palm Springs lacked proper vetting procedures, including detailed background checks, training in fraud recognition, the review of IRS 990 forms (Return of Organization Exempt from Federal Tax), and the omission of monthly updated progress reports.
The RCCGJ investigation revealed through the interviews that councilmembers were basing their decisions on staff reports containing information by QW and DAP, who was a partner. Without DAP’s endorsement for QW, the City of Palm Springs indicated it would not have supported the funding for QW.
12 This case highlights the importance of stringent oversight and accountability when cities collaborate with nonprofits to ensure that public funds are used appropriately and effectively. In response the City of Palm Springs updated its current policy and procedures in September 2024, to include the following:13
• Requiring reimbursement-based payments or split payments for projects over $75,000 • Mandating regular progress reports and invoices
• Establishing minimum eligibility requirements for nonprofits • Requiring annual independent audit reports
• Designating specific city departments and staff to oversee each grant As a result of the alleged misappropriation of funds, by QW, DAP undertook full responsibility and control of the program on July 11, 2024.14
12 3662_3A_-_OCR.pdf
13 Palm Springs seeks to tighten nonprofit grant controls after pilot program issues ⋆ The Palm Springs Post 14 DAP Health: $30K of $700K meant for UBI program available when it assumed control this month ⋆ The Palm Springs Post
Item 1X - Page 15
P – Page 632 of 1107
7 It appeared the City didn’t receive any tangible results for its investment of $700,000 and the City could have their exercised right to review the accounts of QW and DAP as mandated by the MOU.
FINDINGS
F1. The City of Palm Springs lacked comprehensive guidelines and procedures for processing and monitoring grants and contracts. This absence of clear rules or standards did lead to inefficiencies, mismanagement, and misuse of funds.
F2. There is no formal training in fraud prevention or detection for those responsible for reviewing grant claims in the City of Palm Springs.
F3. The City Council of Palm Springs did not request the monthly reports and invoices as required by the Memorandum of Understanding contract with Queer Works and Desert Aids Project (DAP) Health of Palm Springs.
F4. The Memorandum of Understanding contract allowed for two large lump sums payments.
F5. The City of Palm Springs lacked proper auditing procedures, reviews, and monthly updates from a Non-Governmental Organization.
F6. The City of Palm Springs heavily relied upon the endorsement by Desert Aids Project (DAP) Health of Palm Springs to approve the Queer Works grant.
F7. A City Council Member informed the Palm Springs City Council of their suspicion regarding Queer Works' possible wrongdoing.
F8. The receipts submitted by Queer Works revealed inconsistencies in their financial statements to the City of Palm Springs.
F9. The City of Palm Springs' inadequate oversight resulted in a loss of over $700,000.
RECOMMENDATIONS
R1 The Riverside County Civil Grand Jury recommends that the Palm Springs City Council develop comprehensive guidelines and procedures for processing and monitoring grants and contracts, implemented no later than December 31, 2025.
Based on Findings: F1 through F9
Financial Impact: Minimal
Item 1X - Page 16
P – Page 633 of 1107
8 R2 The Riverside County Civil Grand Jury recommends that the Palm Springs City Council mandate annual fraud detection training for city employees who monitor grants and contracts, implemented no later than December 31, 2025.
Based on Findings: F2, F3, F4, and F8
Financial Impact: Minimal
R3 The Riverside County Civil Grand Jury recommends that the Palm Springs City Council ensure all contract Non-Governmental Organizations receiving funding above $50,000 have the payments distributed in multiple installments, to be implemented no later than December 31, 2025.
Based on Findings: F1. F2, F3. and F4
Financial Impact: Minimal
R4 The Riverside County Civil Grand Jury recommends that the Palm Springs City Council establish clearly defined written vetting processes for city employees to use when evaluating Non-Governmental Organization program proposals, to be implemented no later than December 31, 2025.
Based on Findings: F1, F3, F4 and F5
Financial Impact: Minimal
R5 The Riverside County Civil Grand Jury recommends that the Palm Springs City Council review and redefine its policies and procedures related to making lump sum payments to the Non-Governmental Organization programs including assessing associated risks, to be implemented by December 31, 2025.
Based on Findings: F1, F3, F4 and F5
Financial Impact: Minimal
R6 The Riverside County Civil Grand Jury recommends that the Palm Springs City Council hire an independent auditing firm to conduct an internal operational audit (key processes, procedures, and internal controls) and provide improvement suggestions to the Palm Springs City Council by June 30, 2026.
Based on Finding: F1 through F9
Financial Impact: Moderate-High
Item 1X - Page 17
P – Page 634 of 1107
9 R7 The Riverside County Civil Grand Jury recommends that the Palm Springs City Council establish a policy that mandates an independent auditing firm to conduct an internal operational audit (key processes, procedures, and internal controls) every two fiscal years by June 30, 2026.
Based on Finding: F1 through F9
Financial Impact: Moderate-High
R8 The Riverside County Civil Grand Jury recommends that the Palm Springs City Council review and update its policies, regulations, and procedures related to its fraud, waste, and misuse hotline (i.e., 'Whistleblower Hotline”) by December 31, 2025.
Based on Findings: F1 through F9
Financial Impact: Minimal
R9 The Riverside County Civil Grand Jury recommends that the Palm Springs City Council utilize various media channels to announce, at least quarterly, the purpose and availability of its city 'Whistleblower Hotline” no later than December 31, 2025.
Based on Findings: F1 through F9
Financial Impact: Minimal
R10 The Riverside County Civil Grand Jury recommends that the Palm Springs City Council contract with an independent firm to conduct a forensic audit of all city departments vetting and monitoring contracts and grants no later than June 30, 2026.
Based on Findings: F1 through F9
Financial Impact: Moderate-High
Item 1X - Page 18
P – Page 635 of 1107
10 REQUIRED AND INVITED RESPONSES
Under California Penal Code §933, governing bodies are required to respond to grand jury report findings and recommendations within 90 days. California Penal Code §933.05 specifies how these governing bodies must respond.
Required Responses-Due in 90 Days
Location Findings Recommendations
Palm Springs City Council F1 - F9 R1 - R10
Invited Responses
Location Findings Recommendations
Palm Springs City Manager F1 - F9 R1 - R10
CEO Desert AIDS Project (DAP)
Health
F1 - F9 R1 - R10
County Counsel, County of Riverside F1 - F9 R1 - R10
DISCLAIMER
The Riverside County Civil Grand Jury has made no attempt to determine the guilt or innocence of any parties in any impending criminal cases. Our investigation was based solely into the policies and actions of the City of Palm Springs in their processing of contracts of NonGovernmental Organizations. This report is solely limited to the City of Palm Springs.
Report Issued Date:
Report Public Date:
Response Due Date:
6/23/2025
6/26/2025
9/26/2025
Item 1X - Page 19
P – Page 636 of 1107
ATTACHMENT B
Item 1X - Page 20
P – Page 637 of 1107
CITY COUNCIL STAFF REPORT
DATE: NOVEMBER 21, 2024 CONSENT CALENDAR
SUBJECT: UPDATING PROCESSES AND PROCEDURES FOR CITY GRANT
MANAGEMENT AND FUNDS DISBURSEMENT
FROM: Scott C. Stiles, City Manager
SUMMARY:
In a continuing effort for the City to be more transparent in its use of City funds, the City Manager and staff have developed a set of grant management and fund disbursement processes and protocols. Staff wishes to share their ongoing recommendations for City Council consideration.
RECOMMENDATION:
Staff recommends Council approve the proposed updated procedures.
BACKGROUND:
Throughout its history, the City of Palm Springs has provided small grants to nonprofit organizations providing services for the betterment of the community and large grants for marquee events. Upon review of current practices and at the request of Council members, the City Manager initiated a review of City policies and has proposed adjustments to the policies to better manage and safeguard taxpayer dollars while continuing to serve Palm Springs residents through community grants and funding.
STAFF ANALYSIS:
The proposed policy changes (Attachment A) serve to increase accountability and create safeguards around the distribution of City funds. The changes do so without creating unnecessary burden on City Staff or applicant organizations. Changes include:
• Eliminating lump sum payments for any funding above $75,000, requiring contracts to either move to a reimbursement-based payment system or split payments up over time
• Requiring semi-annual submission of progress reports and invoices for funding above $75,000
• Strengthening the due diligence process for investigating organizations that have Item 1X - Page 21
P – Page 638 of 1107
not received funding from the City before
• Requiring organizations receiving over $75,000 to submit an annual independent audit
• Identifying a sponsoring City department and individual point person on City staff assigned to coordinate, oversee, and audit each program/contract. • Establishing training modules for City staff on policies and procedures for grant management and funds distribution
• Updating the City Council annually on how funds are spent and organizations’ impacts on the communities they serve.
These policy recommendations apply to organizations requesting funds directly from the City Council, either during the course of the budget process or raised at a City Council meeting. These policies do not apply to the Small Grants and Sponsorships program, which is administered by staff and has established its own rigorous policies.
ALIGNMENT WITH STRATEGIC PLANNING:
Updating City policies will empower the City Council to better serve residents through City-funded projects, while advancing Palm Springs’ mission to provide excellent, responsive public services that enhance the quality of life for current and future generations.
FISCAL IMPACT:
Policies will change fiscal processes but will not incur any additional expense.
REVIEWED BY:
Assistant City Manager: Teresa Gallavan
City Manager: Scott Stiles
ATTACHMENTS:
A. Processes and Procedures for City Grant Management and Funds Disbursement.
Item 1X - Page 22
P – Page 639 of 1107
ATTACHMENT A
Item 1X - Page 23
P – Page 640 of 1107
MEMORANDUM
To: Palm Springs City Council Members
From: Scott Stiles, Palm Springs City Manager
Date: November 18, 2024
Subject: Processes and Procedures for City Grant Management and Funds Disbursement
In an effort for the City of Palm Springs to be more transparent in its use of City funds, my staff has developed a new set of grant management and fund disbursement processes and protocols for the City Council to review. This policy memo identifies seven areas for improvement and provides actionable recommendations to address them.
These policy recommendations apply to any organization requesting funds directly from the City Council, either during the course of the budget process or raised at a City Council meeting.
These policies do not apply to the Small Grants and Sponsorships program, which is administered by staff and has established its own rigorous policies, nor does this policy apply to standard City contracts for goods and services.
I am presenting this proposal and asking that the Council approve these policy changes so that we can collectively agree to strengthen our processes.
Funding Large Projects in Lump Sum
Current Policy: Most funding from the City Council has been distributed in a lump sum.
Proposed Policy: Eliminate lump sum payments for any funding above $75,000. Grants and funding will be paid through reimbursement. The applicant organization is required to prepare an invoice and progress report showing work completed.
If reimbursement will not work for a particular project, the City Manager is authorized to instead split funds into a minimum of 2 payments, with each payment distributed at least 3 months apart. For funds totaling more than $200,000, funds will be split into a minimum of four payments, with each payment distributed at least 3 months apart with the receipt of progress reports and financial documentation.
If cases occur where organizations need emergency funding and they make a request to appeal to funding protocols, the request will be reviewed by the City Manager, Finance Director, and City Attorney.
Item 1X - Page 24
P – Page 641 of 1107
Achieved through: Approval by the City Council. The Staff Report template and Grant Agreement will be updated to reflect changes.
Regular Reports and Invoices
Current Policy: Most City contracts reserve the right to ask for financials or progress reports at any time in the contract. However, it does not mandate them or establish a timeline for when and how many reports should be received.
Proposed Policy: The City will require progress reports and invoices consistent with the proposed policy regarding Funding Large Projects in Lump Sum. For contracts within the reimbursement program, regular reports and invoices are necessary to receive funding. For contracts in which funds are split over time, the City will not release funds until receipt of required documentation. This will be outlined in the organization’s contract with the City.
Additionally, City staff should maintain documentation on the organization’s disbursement and check approval processes and verify that the disbursement of funds aligns with the reports and invoices received from the organization.
In the event that any internal changes occur within the organization seeking grant funds from the City of Palm Springs, the City must be notified. This includes changes in the organization personnel responsible for grant management; changes to policies or violations, along with corrective actions taken; or any other event affecting the organization’s operations.
Achieved through: Approval by the City Council.
Vetting Process for New Organizations
Current Policy: There is a vetting process for organizations seeking funding through the Small Grants and Sponsorships Program. Grant funding outside the Small Grants and Sponsorship Program, above $75,000, requires City Council approval.
Proposed Policy: Funding recipients must meet minimum eligibility requirements to receive City grant funding. This includes:
1. Be located in the City of Palm Springs or provide services to Palm Springs residents.
2. Meet the definition of a Nonprofit Organization and can provide the organization’s IRS 501(c) tax designation letter.
3. Provide a list of board members (required by the Secretary of State and charitable trust) to confirm legitimacy.
4. Have the ability to provide the organization’s 990 and 990-F federal tax returns, and/or audited financial statements.
5. Include documentation on disbursement and check approval processes.
6. Possess a valid City of Palm Springs Business License, as applicable.
7. Be found in good financial standing with the City of Palm Springs.
8. Be found in good standing from a legal perspective by the City Attorney.
Item 1X - Page 25
P – Page 642 of 1107
9. Provide a proposal that will benefit those living in the City of Palm Springs.
10. Meet all criteria outlined in the grant application.
11. Compliance with all applicable federal, state, and local laws, statutes, and ordinances, and all lawful orders, rules, and regulations when performing grant-funded services.
12. Grantee shall not discriminate against any employee or applicant per the provisions of the Palm Springs Municipal Code Section 7.09.040.
13. The City should not be the primary source of funding for the organization.
All nonprofit organizations, including those with whom the City has historically partnered, must meet minimum eligibility requirements, be in compliance and in good standing with the following agencies:
● IRS Verified Non-Profit Status
● California Secretary of State Good Standing
● DOJ Registry of Charitable Trusts
● Franchise Tax Board Status
● City Department of Finance
● City Code Enforcement
Achieved through: City Council approval of policy revision.
Independent Audit
Current Policy: The current policy does not require organizations to submit audit documentation to the City.
Proposed Policy: Require organizations receiving over $75,000 to submit an independent audit every year. Most organizations should already be performing an annual audit, so the burden of this requirement is low.
To assist smaller organizations in meeting proper auditing standards, organizations may request to conduct a scaled-down audit focused on internal controls, which will be approved at the Finance Director’s discretion.
Achieved through: City Council approval of policy revision, which is included in the minimum eligibility requirements.
Identifying the Responsible Party on Staff
Current Policy: There has been ambiguity about designating the staff person responsible for overseeing a program or contract.
Proposed Policy: A sponsoring City department and individual point person on City staff will be assigned to coordinate and provide oversight of the grantee and audit the program/project expenses upon receipt. The point person is responsible for writing the staff report, overseeing the program and contract, auditing supporting documentation, and raising any issues with appropriate staff and/or Council Members.
Item 1X - Page 26
P – Page 643 of 1107
Achieved through: Policy directive from the City Manager to staff.
Staff Training
Current Policy: Training on grants and contracts among City staff is limited and informal.
Proposed Policy: All City staff who, as part of their normal duties, may oversee a program or contract related to grants or sponsorships must be trained on policies and procedures for approving funding and overseeing a contract. This includes best practices, review of the staff report template, due diligence, documentation, disbursement procedures, finance, internal controls, and fraud risk. The City’s Finance Department will be responsible for conducting this training, in coordination with the City Attorney’s office.
Achieved through: Policy directive from City Manager and/or Department Director to staff.
Current Funding Programs over $75,000
Name Funding Program Staff Assigned
Palm Springs
International Film
Festival
$350,000; current
Agreement in place,
expiring June 2028
Annual Film Festival Cindy Cairns
City Manager’s Office
Palm Springs Art
Museum
$300,000 budgeted
this FY
Free Thursday
Evenings Program
Cindy Cairns
City Manager’s Office
Greater Palm Springs
Pride
$125,000 in-kind City
support; current
Agreement in place,
expiring June 2027
Annual Pride Festival
and Parade
Jasmine Waits
Special Events Manager
Desert X $75,000 budgeted this
FY
Desert X Art
Exhibitions in Palm
Springs
Jay Virata
Community Development
Director
# # #
Item 1X - Page 27
P – Page 644 of 1107
CITY COUNCIL STAFF REPORT
DATE: MAY 27, 2026 CONSENT CALENDAR
SUBJECT: ADOPT THE CITY’S FISCAL YEAR 2026-27 INVESTMENT POLICY
GOVERNING THE INVESTMENT OF CITY FUNDS
FROM: Scott C. Stiles, City Manager
BY: Department of Finance and Treasury
SUMMARY:
Government Code Section 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:
1) Adopt a Resolution entitled, “A RESOLUTION OF THE CITY COUNCIL OF THE
CITY OF PALM SPRINGS, CALIFORNIA, ADOPTING AN INVESTMENT POLICY
GOVERNING THE INVESTMENT OF CITY FUNDS AND SUPERSEDING
RESOLUTION NO. 25200”.
2) Delegate 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 (CAM) to provide investment advisory services to the City. Although Chandler Asset Management works with Staff to actively manage the portion of the City’s
Q – Page 645 of 1107
City Council Staff Report
May 27, 2026 -- Page 2
Fiscal Year 2026-27 Investment Policy
cash portfolio not needed to meet near-term obligations, fiduciary responsibility for investments remains with the City.
STAFF ANALYSIS:
The City of Palm Springs’ investment advisor, Chandler Asset Management, and the Finance Sub-Committee recently reviewed the City’s investment policy. The team from Chandler Asset Management recommended changes that incorporated industry best practices and updates to align with California State Code. Those changes are listed in the attached investment policy document, with comments (Attachment A). A memo summarizing the changes is included as Attachment B.
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 of October 2021 which reviews the City’s directive to Chandler Asset Management on Socially Responsible Investing (SRI) and Environmental, Social, and Governance (ESG) strategies (Attachment D).
The Finance Sub-Committee reviewed the Investment Policy and the recommended changes with Chandler Asset Management at the quarterly meeting on April 29, 2026.
The Finance Sub-Committee agrees with the changes. In addition to the Investment Policy changes, the Finance Sub-Committee also recommended making a change to the issuer’s list in Attachment E. The issuers list is comprised of large corporations the City can invest in the company’s corporate bond issuances. The list meets the City’s ESG strategy of not investing in companies that support firearm sales and/or manufacturing and companies that support the manufacturing of Alcohol and Tobacco. The Finance Sub-Committee is recommending moving forward with a sector approved list in Attachment E.
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 quarterly Cash and Investments Report (“Treasurer’s Report”) describes the portfolio’s composition and recent performance and reports each of the quarter’s monthly 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 following City Council Strategic Plan Foundation of Financial and Organizational Well-Being.
Q – Page 646 of 1107
City Council Staff Report
May 27, 2026 -- Page 3
Fiscal Year 2026-27 Investment Policy
FISCAL IMPACT:
None.
REVIEWED BY:
Department Director: Kristopher J. Mooney
City Manager: Scott Stiles
ATTACHMENTS:
A. City of Palm Springs Investment Policy (Redlined showing updates) B. Memo from Chandler Asset Management
C. City of Palm Springs Management Directive
D. October 2021 Staff Report with SRI/ESG Strategies
E. City of Palm Springs Issuer List
F. City of Palm Springs Investment Policy, Final
G. Resolution
Q – Page 647 of 1107
ATTACHMENT A
City of Palm Springs
Investment Policy
(Redlined showing updates)
Q – Page 648 of 1107
CITY OF PALM SPRINGS
2026-2027
INVESTMENT POLICY
Q – Page 649 of 1107
CITY OF PALM SPRINGS
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 are managed separately by trustees appointed under indenture agreements.
Q – Page 650 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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 general 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.
Q – Page 651 of 1107
CITY OF PALM SPRINGS
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 16.1.
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
Q – Page 652 of 1107
CITY OF PALM SPRINGS
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
Q – Page 653 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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
Q – Page 654 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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%
• Maximum percent of callable agency securities in the portfolio will be 20%.
Q – Page 655 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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: 270 397 Days
• Maximum Percentage of Portfolio: 15% Under a provision sunsetting on January 1, 20262031, 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)
Commented [AS1]: Senate Bill 595 extends the maximum
maturity date for CP investments from 270 to 397 days,
effective January 1, 2026.
Commented [AS2]: Senate Bill 595 extends this provision from 1/1/2031 to 1/1/2031, effective January 1, 2026.
Q – Page 656 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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 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
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
Q – Page 657 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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 less 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.)
Q – Page 658 of 1107
CITY OF PALM SPRINGS
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
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, 2031, 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: 50%
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.
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 may invest, provided that the securities used as collateral for Repurchase Agreements will be delivered to an acceptable third-party custodian. Repurchase
Q – Page 659 of 1107
CITY OF PALM SPRINGS
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
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
JOINT POWERS AUTHORITY (JPA)
A JPA is organized pursuant to California Government Code Section 6509.7 and invests in the securities and obligations authorized in subdivisions (a) to (r), inclusive. Each share shall represent an equal proportional interest in the underlying pool of securities owned by the JPA. The JPA shall retain an investment advisor who is registered with the SEC (or exempt from registration), has assets under management in excess of $500 million, and has at least five years’ experience investing in instruments authorized by Section 53601, subdivisions (a) to (q).
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:
Q – Page 660 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
13 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, 20262031, securities 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.
Commented [AS3]: Senate Bill 595 extends this provision from 1/1/26 to 1/1/31, effective January 1, 2026
Q – Page 661 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
14 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.
Repurchase Agreements
The City requires that Repurchase Agreements be collateralized only by securities authorized in accordance with California Government Code. and will be delivered to an acceptable third-party custodian. 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:
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 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 Commented [AS4]: Best Practice. CMTA Reviewers would
like to see the collateralization to THIRD PARTY
CUSTODIANS repeated in the collateralization section.
Q – Page 662 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
15 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?
13.0 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 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
Q – Page 663 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
16 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.
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. Individual maturities are subject to the limitations described in Section 9.0.
15.0 Internal Control:
The Director of Finance/Treasurer shall establish a system of internal controls designed
Q – Page 664 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
17 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. Additionally, 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
16.0 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.
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 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
Q – Page 665 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
18 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.
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
Q – Page 666 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
19 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:
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.
Q – Page 667 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
20 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 statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP).
Q – Page 668 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
21 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 that played by the Federal Reserve Banks vis-a-vis member commercial banks.
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC): Created to promote
Q – Page 669 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
22 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.
FIDUCIARY: A person or organization that acts on behalf of another person(s) or organization that puts their clients’ interest ahead of their own as they are bound both legally and ethically to act in the best interests of their clients.
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.
Q – Page 670 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
23 LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash 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.
PLACEMENT SERVICE DEPOSITS: A private service that allows local agencies to invest in FDIC-insured deposits with one or more banks, savings and loans, and credit
Q – Page 671 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
24 unions located in the United States. IntraFi (formerly known as CDARS) is an example of an entity that provides this service.
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 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
Q – Page 672 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
25 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 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 yield 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.
Q – Page 673 of 1107
ATTACHMENT B
Memo from Chandler
Asset Management
Q – Page 674 of 1107
SUMMARY OF CHANGES TO THE INVESTMENT POLICY PREPARED BY
CHANDLER ASSET MANAGEMENT
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) governance of the investment public The policy was also reviewed to ensure 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) were included.
Below is a summary of those changes:
• Updated based on the latest California Government Code, effective 01/01/2026, Senate Bill 595 o Extends the provision to allow up to 40% of a total portfolio in commercial paper through 2031.
o Allows investment in zero- or negative interest rate accrual of US Treasury securities through 2031.
o Extends the CP maximum maturity to increase from 270 days to 397 days. • Update glossary based on the latest market standards.
Q – Page 675 of 1107
ATTACHMENT C
City of Palm Springs
Management Directive
Q – Page 676 of 1107
Q – Page 677 of 1107
ATTACHMENT D
October 2021 Staff Report
with SRI/ESG Strategies
Q – Page 678 of 1107
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:
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.
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 1E - Page 35
Q – Page 679 of 1107
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 more 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:
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.
Staff will update the FY21-22 Investment Policy to include best practices such as:
Sustainable, Socially Conscious, Green, and Ethical.
Negative Screening of SRI & ESG Strategies will include prohibiting:
• Tobacco Products
• Fossil Fuel
• Alcohol
Item 1E - Page 36
Q – Page 680 of 1107
City Council Staff Report
October 14, 2021 -- Page 3
Socially Responsible Investing
• Gun/Weapons Manufacturing and Distribution
Positive Screening 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
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 using a third-party resource.
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 BY:
Department Director:
Assistant City Manager:
City Manager:
ATTACHMENTS:
None
Item 1E - Page 37
Q – Page 681 of 1107
ATTACHMENT E
City of Palm Springs
Issuer List
Q – Page 682 of 1107
Palm Springs - SRI 2026
Company Name Industry
APPLE INC Technology
ABBVIE INC Consumer, Non-cyclical
ABBOTT LABORATORIES Consumer, Non-cyclical
AUTOMATIC DATA PROCESSING Consumer, Non-cyclical
AMAZON.COM INC Communications
AIR PRODUCTS & CHEMICALS INC Basic Materials
AMERICAN EXPRESS CO Financial
BANK OF AMERICA CORP Financial
BANK OF NEW YORK MELLON CORP Financial
CATERPILLAR INC Industrial
COLGATE-PALMOLIVE CO Consumer, Non-cyclical
COMCAST CORP-CLASS A Communications
CME GROUP INC Financial
COSTCO WHOLESALE CORP Consumer, Cyclical
SALESFORCE INC Technology
CISCO SYSTEMS INC Communications
DEERE & CO Industrial
ALPHABET INC-CL A Communications
GOLDMAN SACHS GROUP INC Financial
HOME DEPOT INC Consumer, Cyclical
JPMORGAN CHASE & CO Financial
KIMBERLY-CLARK CORP Consumer, Non-cyclical
COCA-COLA CO/THE Consumer, Non-cyclical
LINDE PLC Basic Materials
ELI LILLY & CO Consumer, Non-cyclical
MASTERCARD INC - A Financial
MERCK & CO. INC. Consumer, Non-cyclical
MORGAN STANLEY Financial
MICROSOFT CORP Technology
NETFLIX INC Communications
PEPSICO INC Consumer, Non-cyclical
PFIZER INC Consumer, Non-cyclical
PROCTER & GAMBLE CO/THE Consumer, Non-cyclical
PROGRESSIVE CORP Financial
PROLOGIS INC Financial
PNC FINANCIAL SERVICES GROUP Financial
SCHWAB (CHARLES) CORP Financial
STATE STREET CORP Financial
TRUIST FINANCIAL CORP Financial
TARGET CORP Consumer, Cyclical
UNITEDHEALTH GROUP INC Consumer, Non-cyclical
UNION PACIFIC CORP Industrial
UNITED PARCEL SERVICE-CL B Industrial
US BANCORP Financial
VISA INC-CLASS A SHARES Financial
Q – Page 683 of 1107
ATTACHMENT F
City of Palm Springs
Investment Policy, Final
Q – Page 684 of 1107
CITY OF PALM SPRINGS
2026-2027
INVESTMENT POLICY
Q – Page 685 of 1107
CITY OF PALM SPRINGS
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 are managed separately by trustees appointed under indenture agreements.
Q – Page 686 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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 general 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.
Q – Page 687 of 1107
CITY OF PALM SPRINGS
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 16.1.
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
Q – Page 688 of 1107
CITY OF PALM SPRINGS
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
Q – Page 689 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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
Q – Page 690 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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%
• Maximum percent of callable agency securities in the portfolio will be 20%.
Q – Page 691 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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: 397 Day
• Maximum Percentage of Portfolio: 15% Under a provision sunsetting on January 1, 2031, 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)
Q – Page 692 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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 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
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
Q – Page 693 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
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 less 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.)
Q – Page 694 of 1107
CITY OF PALM SPRINGS
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
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, 2031, 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: 50%
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.
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 may invest, provided that the securities used as collateral for Repurchase Agreements will be delivered to an acceptable third-party custodian. Repurchase
Q – Page 695 of 1107
CITY OF PALM SPRINGS
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
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
JOINT POWERS AUTHORITY (JPA)
A JPA is organized pursuant to California Government Code Section 6509.7 and invests in the securities and obligations authorized in subdivisions (a) to (r), inclusive. Each share shall represent an equal proportional interest in the underlying pool of securities owned by the JPA. The JPA shall retain an investment advisor who is registered with the SEC (or exempt from registration), has assets under management in excess of $500 million, and has at least five years’ experience investing in instruments authorized by Section 53601, subdivisions (a) to (q).
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:
Q – Page 696 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
13 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, 2031, securities 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.
Q – Page 697 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
14 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.
Repurchase Agreements
The City requires that Repurchase Agreements be collateralized only by securities authorized in accordance with California Government Code and will be delivered to an acceptable third-party custodian. 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:
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 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
Q – Page 698 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
15 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?
13.0 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 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
Q – Page 699 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
16 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.
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. Individual maturities are subject to the limitations described in Section 9.0.
15.0 Internal Control:
The Director of Finance/Treasurer shall establish a system of internal controls designed
Q – Page 700 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
17 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. Additionally, 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
16.0 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.
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 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
Q – Page 701 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
18 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.
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
Q – Page 702 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
19 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:
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.
Q – Page 703 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
20 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 statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP).
Q – Page 704 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
21 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 that played by the Federal Reserve Banks vis-a-vis member commercial banks.
FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC): Created to promote
Q – Page 705 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
22 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.
FIDUCIARY: A person or organization that acts on behalf of another person(s) or organization that puts their clients’ interest ahead of their own as they are bound both legally and ethically to act in the best interests of their clients.
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.
Q – Page 706 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
23 LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash 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.
PLACEMENT SERVICE DEPOSITS: A private service that allows local agencies to invest in FDIC-insured deposits with one or more banks, savings and loans, and credit
Q – Page 707 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
24 unions located in the United States. IntraFi (formerly known as CDARS) is an example of an entity that provides this service.
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 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
Q – Page 708 of 1107
CITY OF PALM SPRINGS
INVESTMENT POLICY AND GUIDELINES
25 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 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 yield 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.
Q – Page 709 of 1107
ATTACHMENT G
Resolution
Q – Page 710 of 1107
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 2026-27
AND SUPERSEDING RESOLUTION NO. 25200.
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 F and incorporated by reference, is hereby adopted; and
WHEREAS, Resolution No. 25200 is hereby superseded in its entirety.
PASSED, APPROVED AND ADOPTED BY THE PALM SPRINGS CITY COUNCIL THIS 27 DAY OF MAY, 2026.
Scott C. Stiles, City Manager
ATTEST:
Brenda Pree, City Clerk
Q – Page 711 of 1107
Q – Page 712 of 1107
Resolution No.