1 SANTA CLARA VALLEY TRANSPORTATION AUTHORITY
CONGESTION MANAGEMENT PROGRAM
TRANSPORTATION FUND FOR CLEAN AIR
AGREEMENT
FY 2025/26
This agreement (“Agreement”) is entered into between the Santa Clara Valley Transportation Authority (“VTA”) and the City of Palo Alto (“Sponsor”) and sha ll be effective beginning on July 1, 2025 (“Effective Date”). Hereinafter, Sponsor and VTA may be individua lly referred to as a “PARTY” or collectively referred to as the “PARTIES”.
RECITALS
This Agreement is made with reference to the following facts:
A. VTA has been designated, by reso lutions of the County of Santa Clara and most of the cities therein, as the Program Manage r for Santa Clara County’s Tran sportation Fund for Clean Air (“TFCA”) funds under the State of California Health and Safety Code Section 44241.
B. Pursuant to that designation, VTA is responsible for allocating and administering the County of Santa Clara’s TFCA County Progr am Manager (“CPM”) Fund to e ligible project sponsors in accordance with the State of California Heal th and Safety Code Sections 44241 and 44242 and VTA’s current agreement with the Bay Area Air Quality Management District (“Air District”).
C. On October 2, 2025, the VTA Board approved the programming of Fiscal Year (“FY”) 2025/26 TFCA CPM funds for the Palo Alto Link project (“Project(s)”).
D. This Agreement specifies the conditions und er which VTA will allocate and administer a grant(s) from the TFCA CPM Fund to Sponsor for FY 2025/26.
Now, therefore the Parties agree as follows:
AGREEMENT
Section 1. Grant of TFCA Funds; Description of Projects A. Subject to appropriation and rece ipt of TFCA funds (as further set forth in Section 10, below), VTA hereby agrees to allocate to Sponsor a TFCA grant in an amount not to exceed $456,500 (the “Grant Funds”) in consid eration for Sponsor’s agreement to implement and complete the Project(s), as further set forth in the Pr oject Summary(ies) attached hereto as Attachment A, in accordance with the terms and conditions set forth in this Agreement.
B. In consideration of VTA providi ng Sponsor with the Grant Funds , Sponsor hereby agrees to implement and complete the Project(s) in conformance with the terms of this Agreement. In implementing the Project(s), Spons or shall comply with reporting requirement s as described in Section 13.
2 Section 2. Proper Expenditure; Return of Funds
A. Sponsor must assure that all Grant Funds received under this Agreement are expended only in accordance with all applicable provisions of fede ral, state, and local laws, and Sponsor shall require any other sub-recipients of Grant Funds for the Project(s) to do the same.
B. Sponsor must comply with all TFCA program requi rements, as set forth in the Air District’s County Program Manager Fund Expenditure Plan Guidance Fiscal Year Ending (FYE) 2026 (“Guidance”) and the 26-SC Funding Agreemen t between VTA and the Air District. These documents, including appendices an d revisions, are incorporated he rein and made a part hereof by this reference as if fully set forth here in and will be provided by VTA to Sponsor upon written request.
C. Since the Air District mandates th at all TFCA Funds that are not expended in accordance with applicable provisions of law must be returne d, Sponsor must reimburse VTA all Grant Funds that are not expended in accordance with the te rms and conditions of this Agreement and/or applicable provisions of law upon VTA's written notification to Sponsor.
D. Sponsor must also return the Gr ant Funds to VTA if the Project( s) are not maintained and/or operated throughout and until the conclusion of the years of effectiveness (“Years of Effectiveness”). This is the default value stated in the Air District’s Guidance for the applicable project type, unless a different value was approved by the Air Di strict and shown to yield a project that meets the cost-effectiveness requirement specified in the TFCA Guidance document cited above. The amount of Grant Funds returned to the Program Manage r must be calculated on a prorated basis based on the length of a project’s Years of Effectiveness.
Section 3. Administrative project costs
Grant Funds may not be expended on Administrative Project Costs. As explained in the Guidance, these are costs associated with the administration of a TFCA project and include the costs to prepare proposals and/or grant applications.
Section 4. Term
A. The term of this Agreement is retroactiv e beginning on July 1, 2025, through December 31, 2031, or terminated in accordance with Section 17 (Termination).
B. The Grant Funds must be expended within two (2) y ears of receipt of the first transfer of funds from the Air District to the VTA in the applic able fiscal year, unless one of the following applies:
a. Multi-Year Funded Project: If VTA requests multi-year fund ing in compliance with the Guidance; and the Air District approves the request for multi-year funding. b. Extensions of Expenditure Deadline: If VTA finds that a project will take a longer period to implement or that significant pr ogress has been made on a project, then
3 VTA can approve no more than two one ‐year schedule extensions for a project, as memorialized in writing by VTA. Any subsequent schedule extensions for projects may be given on a case ‐by‐case basis only by written amendment to this Agreement, if the Air District finds that significant progress has been made on a project, and the Funding Agreement is amended to reflect the revised schedule.
C. In addition to the specific term of this Agreem ent, Sponsor must maintain each Project for the Years of Effectiveness prescribed in Section 2D herein.
Section 5. Work Product
Sponsor must place in the public domain any so ftware, written document, or other product developed with funds received through this Agreem ent, to the extent no t otherwise prohibited by law, and to the extent required by the California Public Records Act (California Government Code Sections 7920.000 et seq.).
Section 6. Acknowledgement of Funding Sources
A. Sponsor must acknowledge both VTA and Ai r District as funding sources during the implementation of the Project(s) and must use the VTA and the Air District approved logos as specified below:
(1) The logos must be used on signs posted at the site of any project construction; (2) The logos must be displayed on any vehicles or equipment operated with or obtained as part of the Project(s);
(3) The logos must be used on any material inte nded for public consumption associated with the Project(s), such as websites and printed mate rials, including transit schedules, brochures, handbooks, maps created for public distribution, and promotional material; and (4) Sponsor will demonstrate to VTA, through evidence such as photographs of vehicles, equipment, construction signs, a nd copies of press releases, that the logos are used and displayed as required by this Section.
B. VTA will provide a copy of Air District and VTA logos to Sponsor for use in fulfilling Sponsor’s obligations under this Section.
C. Sponsor must acknowledge VTA and Air District as a funding sour ce in any related articles, news releases, or other publicity materials for th e Project(s) that are produced or caused to be produced by Sponsor.
Section 7. Indemnity a nd Insurance Requirements
A. Sponsor must indemnify, defend, and hold harmless VTA, the Air District, their respective directors, officers, officials, agents, employees, representatives, and successors-in-interest from any claim, liability, loss, expense, including reasonable attorneys’ fees, and/ or claims for injury or damage arising out of, or in connection with, performance of this Agreement by Sponsor
4 and/or its agents, employees, representatives, an d subcontractors, excepting only loss, injury or damage caused by the gross negligence or willful misconduct of personnel employed by VTA.
B. Sponsor must adhere, throughout the term of this Agreement, to th e insurance requirements specified in Attachment B “Insurance Requirements”, whic h are hereby incorporated by reference. In any agreement be tween Sponsor and a third party for purposes related in any way to the subject matter of this Agreement (“Third Party Contract”), Sponsor must require that VTA and Air District be named as (i) additional insured on all policies of insurance required by Sponsor in the Third-Party Contract and (ii) indemnified party in any indemnity provision contained in the Third-Party Contract. Such Th ird-Party Contracts must contain requirements for General Liability, Automobile Liability, Wo rkers’ Compensation and Employer’s Liability, and Pollution Liability. The Insurance Requireme nts may be satisfied by self-insurance or pooled risk plans that provide comparable coverage.
Section 8. Invoicing
Sponsor must submit invoices at qu arterly intervals to VTA for reimb ursement of costs incurred to implement the Project(s). Sponsor must email requests for reimbursement to VTA Accounts Payable at [email protected]. Sponsor must include relevant, auditable back-up documentation (time sheets, bills, etc.) with each invoice.
Section 9. Reimbursement
A. All funds allocated by VTA to Sponsor will be paid on a cost-reimbur sement basis only. VTA will pay no funds in advance.
B. Upon review and approval of invoices and documentation, VTA will, within fifteen (15) days of receipt of an invoice that confor ms to the requirements set fort h in this Agreem ent, reimburse Sponsor for all eligible expend itures up to the maximu m amount described in Section 1 of this Agreement. Only those expenses incurred by Sponsor on or after July 1, 2025, will be considered reimbursable expenditures.
C. Funds for the Projects described in this Agreement, which are not spent by prior to June 30, 2028 and submitted for reimbursement within four months, will not be available to reimburse Project costs unless a Project schedule, which extends the Project completion date beyond June 30, 2028, has been approved by either VTA or the Air District.
Section 10. Funds Subject to Appropriatio n/Allocation of Funds Contingent on Appropriation
VTA’s obligations under the terms of this Ag reement are contingent upon and subject to the allocation of TFCA funds to VTA by the Air Dist rict under VTA’s “26-SC” agreement with the Air District for approved projects during Fiscal Year 2025/26.
5 Section 11. Audit
This Agreement is subject to the examination and audit of the California St ate Auditor pursuant to California Government Code Section 8546.7 for a pe riod of five (5) years after each Project(s) Years of Effectiveness. Audits ma y also be conducted by an audito r chosen by the Air District or VTA.
Section 12. Sponsor’s Record Keeping
Sponsor must:
A. Allow VTA and Air District staff, authorized re presentatives, and inde pendent auditors, during the term of this Agreement and for five (5) y ears from the end of each Project(s) Years of Effectiveness, to conduct performance and financial audits and to inspect the Project(s). During audits, Sponsor must make available to the audito r, in a timely manner, all records relating to Sponsor’s implementation of the Project(s). Du ring inspections, Sponsor will provide, at the request of VTA or the Air District, access to inspect the Project(s) and related records.
B. Maintain employee time sheets documenting those hourly labor costs incurred in the implementation of the Project(s) , including both administrative and implementation costs, or to establish an alternative method to document staff costs charged to the Project(s). Sponsor must keep such documents in a central location for a period of five (5) ye ars from the end of each Project’s Years of Effectiveness.
C. Keep all financial and implemen tation records necessary to demonstrate compliance with this Agreement and the TFCA Program. Such records must include documentation that demonstrates significant progress made for those Project(s) seeking extensions to the completion date.
Sponsor must keep such documents in a central locati on for a period of five (5) years from the end of each Project’s Years of Effectiveness.
6 Section 13. Reporting Requirements.
A. Sponsor must submit an interim project repo rt to VTA in each May and October until the Project(s) is/are completed, and all closeout requirements have been fulfilled. The interim report must utilize Air District-approve d report forms. One form should be submitted for each Project listed in Attachment A. VTA will supply the Inte rim Project Report form to Sponsor for this requirement.
B. Sponsor must submit a Final Report for each co mpleted Project on the Air District-approved report form appropriate for th e specific project type. Sponsor must also submit a post ‐project Cost-Effectiveness spreadsheet. Post‐project evaluations should be completed using the version of the Cost‐Effectiveness worksheet for the year the purchased, insta lled, or constructed project became available for use by the public. VTA will provide the Final Report Forms and spreadsheets for this requirement.
Section 14. Review
VTA will review Sponsor’s progress in implementing the Project(s) at the end of the sixth (6 th) quarter following execution of this Ag reement. If progress at the sixth (6 th) quarter review is insufficient to implement any Project or to expend the funds within the period described in Section 4, VTA will develop an action plan with S ponsor to ensure that the Grant Funds are not required to be repaid to VT A and/or the Air District. The action plan may include reprogramming funds to other proj ects within Santa Clara County to ensure their expenditure prior to the term expiration date described in Section 4.
Section 15. Non-Performance
If Sponsor causes all or part of these Grant F unds to be subject to repayment to the CPM Fund because of failure to complete the Project(s ) according to the work scope described in Attachment A, Sponsor’s next grant allocation of any kind that is from or passes through VTA may be reduced by the amount that VTA repaid to the CPM Fund.
Section 16. General Terms and Conditions
A. Notices. Any notice required to be given by either Party, or whic h either Party may wish to give, must be in writing and serv ed either by personal delivery or sent by certified or registered mail, postage prepaid, addressed as follows:
To VTA: Santa Clara Valle y Transportation Authority
Chief Planning & Programming Officer
3331 North 1st Street
San José, CA 95134-1906
To SPONSOR: City of Palo Alto
Office of Transportation
250 Hamilton Avenue
Palo Alto, CA 94301
7 B. Program Liaison. Within thirty (30) days from the Effective Date of this Agreement, Sponsor must notify VTA of Sponsor’s “Program Liaison” and provide the Program Liaison’s address, telephone number, and email address. The Progr am Liaison must be the contact to VTA pertaining to implementation of this Agreemen t and for information about the Project(s).
Sponsor must notify VTA of the change of Program Liaison or of the Program Liaison’s contact information in writing no later than thirty (30) days from the date of any change.
C. Non-Waiver. The failure of either part y to insist upon the strict performance of any of the terms, covenants, and conditions of this Agreemen t will not be deemed a waiver of any right or remedy that either party may have and will not be deemed a waiver of their right to require strict performance of all of the terms, covenants, and conditions thereafter.
D. Assignment: Sponsor must not assign, se ll, license, or otherwise transfer any rights or obligations under this Agreement without the prior written consent of VTA.
E. Integration. This Agreement, including all attachments and references, constitutes the entire Agreement between the Parties pertaining to the subject matter contained herein and supersedes all prior or contemporaneous agreements, repr esentations, and understandings of the Parties relative thereto.
F. Amendments. Future amendments and modifications to this Agreement must be made in writing and signed by both parties.
G. Independent Contractor : Sponsor is an independent contr actor and shall no t be considered employees or agents of VTA or the Air District.
H. Governing Law: Any dispute that arises under or relate s to this Agreement shall be governed by California law, excluding any laws that direct the application of anothe r jurisdiction’s laws.
Venue for resolution of any disput e that arises under or relates to this Agreement shall be San Jose, California.
I. Attachments. Each attachment hereto is incorporated into this Agreement as if fully set forth herein.
J. Severability. If any term, covenant, condition, or provision of this Agreement, or the application thereof to any person or circumstance, shall to any extent be held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of the terms, covenants, conditions, and provisi ons of this Agreement, or the application thereof to any person or circumstance, must remain in full for ce and effect and shall in no way be affected, impaired or invalidated thereby.
K. Warranty of Authority to Execute Agreement. Each Party to this Agreement represents and warrants that each person whose signature appear s hereon has been duly authorized and has the full authority to execute this Agreement on behalf of the entity that is a Party to this Agreement.
L. Survival. Any provision that, by its nature, extends beyond the term or termination of this Agreement, including but not limited to Sections 2D and Section 7, will survive the expiration or termination of this Agreement.
8 Section 17. Termination.
A. Voluntary. Either Party may terminate this Agreemen t and/or a Project at any time by giving written notice of termination to the other Party which must specify the effective date thereof.
Notice of termination under this paragraph must be given at leas t ninety (90) days before the effective date of such termination unless the Pa rties mutually agree to an earlier termination date. This Agreement will also terminate at the end of the fiscal year during which VTA loses its designation as County Program Manager for Santa Clara County.
If VTA terminates this Agreement and/or a Project pursuant to this provision, the Sponsor must cease all work under this Agreement and cease fu rther expenditures of Grant Funds received under this Agreement for the terminated Proj ect immediately upon rece ipt of the notice of termination, excepting any work permitted to continue that is specified in the notice of termination. VTA will review the project to deter mine if it will still reduce emissions, and if it does, VTA may reimburse Sponsor for eligible funds and no further Grant Funds will be provided for that Project.
If Sponsor terminates this Agreement and/or a Project pursuant to this provision, the Sponsor must return all Grant Funds pr ovided by VTA for the specific Pr oject up to and including the date of termination.
B. After Breach. VTA may terminate this Agreement and/or a Project for breach. Upon any breach, VTA will deliver a written notice of termination for breach to Sponsor that specifies the date of termination, which will be no less than ten (10) business days from delivery of such notice and will provide the Sponsor an opportunity to contest such breach within that period of time. If Sponsor contests the notice of terminat ion for breach, VTA will provide written notice of VTA’s determination of Sponsor’s contestation. If VTA upholds the te rmination for breach, the written notice will specify the effective date of termination and Sponsor will have ten (10) business days to cure. If the breach is not cure d within the allotted time, the Agreement will automatically terminate. The no tice of termination will specify the Total Grant Funds VTA has paid to the Sponsor, which Sponsor must reimburse to the VTA within thirty (30) days of the effective date of termination.
9 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date shown below.
City of Palo Alto Santa Clar a Valley Transportation Authority (Sponsor) (VTA)
Dated: ____________________________ Dated: _____________________________
__________________________________ ___________________________________ Ed Shikada Carolyn Gonot
City Manager General Manager and CEO
City of Palo Alto
VTA
Approved as to Form: Approved as to Form:
_________________________________ _________________________________ Tim Shimizu Judith Propp
Assistant City Attorney VTA Counsel
1 ATTACHMENT A – PROJECT INFORMATION SHEET
A. Project Number: 26SC04
B. Project Title: Palo Alto Link
C. Project Category (project will be evaluated under this category): 5e D. TFCA County Program Manager Funds Allocated: $456,500 E. TFCA Regional Funds Awarded (if applicable): $0
F. Total TFCA Funds Allocated (sum of C and D): $456,500 G. Total Project Cost: $1,800,000
H. Project Description:
With $456,500 in support from the BAAQMD Transportation Fund for Clean Air (TFCA), the City of Palo Alto seeks to continue operating its microtransit program (Palo Alto Link or PAL) through June 2026. This project is aligned with TFCA’s directive to reduce greenhouse gas emissions, improve transportation options for riders, reduce traffic congestion in the region, and reduce air pollution. The service will address multiple high-priority needs for the community including:
1. Reduce reliance on the single-occupancy vehicle and decrease overall greenhouse gas emissions
2. Facilitate east-west service and connections across the city
3. Increase accessibility for Palo Alto’s priority populations including low-income individuals and older adults
Project History and Need
Beginning in December 1999, the City of Palo Alto ran two free shuttle bus services on weekdays between the Palo Alto Caltrain station and destinations throughout the city limits. In addition, on both routes, the City ran a special school commute shuttle service on school days. The shuttle programs serviced numerous vulnerable and transit-dependent populations including students and seniors, with an estimated 550 riders per day and 140,000 riders per year.1 On July 1, 2020, both shuttle bus services were discontinued due to a temporary lack of riders during the COVID-19 pandemic and constraints on the City budget. Additionally in 2019, VTA implemented reductions in bus service in Palo Alto, making it much more difficult for those who work and live in Palo Alto to reach medical appointments, run errands, and get to work and school. VTA has rejected the idea of providing funds to backfill bus service reductions with local shuttle service.
Additionally, the Caltrain rail corridor and State Highway 82/El Camino Real bifurcate the City from north to south creating a lack of east-west transit connections. This makes it extremely difficult for residents to live a car-lite (or car-free lifestyle). If an individual is without access to a car entirely, their long-distance commute will require local bus service on both ends and local services are often infrequent and slow.
To remedy these critical transportation cuts and address the lack of east-west connections, the City of Palo Alto applied for the Innovative Transit Service Models Competitive Grant from the Measure B Program to implement an on-demand transit service. The City received funds to begin and run the microtransit service for 18 months and is now requesting funds through TFCA to fund continuation of the service. PAL is a dynamically routed on-demand microtransit service that is designed to reduce single-occupancy vehicle trips, improve mobility, and enable multimodal connections. PAL
2 serves the entire city of Palo Alto and currently provides an average of 1,000 trips per week. The service allows riders to request trips anywhere within the zone; riders are picked up shortly after their trip is requested, and trips are grouped with others going in the same direction. There are 10 vehicles in the fleet, 3 of which are hybrid-electric and 7 that are electric. Funds through TFCA will support operating costs for the service and facilitate the transition to electric vehicles.
1 ATTACHMENT B – INSURANCE REQUIREMENTS
SPONSOR’S ATTENTION IS DIRECTED TO THE INSURANCE REQUIREMENTS BELOW. IT IS HIGHLY RECOMMENDED TH AT SPONSOR CONFER WITH THEIR
INSURANCE CARRIERS OR BROKERS IN ADVANCE OF PROPOSAL SUBMISSION
TO DETERMINE THE AVAI LABILITY OF INSURANCE CERTIFICATES AND ENDORSEMENTS REQUIRED BY THIS CONTRACT.
INSURANCE
Without limiting Sponsor’s oblig ation to indemnify and hold harmless VTA, Sponsor must procure and maintain for the durat ion of the Contract insurance ag ainst claims for injuries to persons or damages to property which may arise from or in conn ection with the performance of the Work hereunder by Sponsor, its agents, representatives, or employees, or subcontractors. The cost of such insurance must be included in Contr act price. In the event of any material change in the Contract Scope of Services, VTA reserves the right to change the insurance requirements set forth herein. Sponsor must furnis h complete copies of all insura nce policies, within three (3) business days of any request for such by VTA.
A. Liability and Workers’ Compensation Insurance
1. Minimum Scope of Coverage
Coverage must be at least as broad as:
a. Insurance Services Offi ce General Liability coverage (“occurrence” form CG 0001).
General Liability insurance written on a “claims made” basis is not acceptable.
b. Insurance Services Office Business Auto Coverage, Insurance Services Office form number CA 0001, covering Automobile Liability , code 1 “any auto.” Auto Liability written on a “claims-made” basis is not acceptable.
c. Workers’ Compensation insurance as re quired by the Labor Code of the State of California and Employer’s Liability insurance.
d. Professional Liability, including limited contractual liability coverage, covering liability arising out of any negligent ac t, error, mistake or omission in the performance of Sponsor’s services under this Agreement. This coverage must be continuously maintained for a minimum of two (2) years following completion of this Agreement. This coverage may be written on a claims made basis, if so, see special provisions in Section B.
e. Sponsor’s Pollution/Environmental Impair ment Liability: covering liability arising out of the treatment, handling, storage, tran sportation, or accident al release of any hazardous material.
2 2. Minimum Limits of Insurance
Sponsor must maintain limits no less than:
a. General Liability (including umbr ella/excess liabil ity): $4,000,000 limit per occurrence for bodily injur y, personal injury, and pr operty damage. If General Liability Insurance or other form with a ge neral aggregate limit is used either the general aggregate limit must apply separately to this project/location or the general aggregate limit must be twice the required o ccurrence limit. This requirement may be satisfied by a combination of General Liabili ty with Excess or Umbrella, but in no event may the General Liability primary policy limit per occurrence be less than $2,000,000, unless Umbrella/Excess policies fe ature inception and expiration dates concurrent with the underlying General Liability policy, “Follow Form” coverage, and a “Drop Down”.
b. Automobile Liability (including umbr ella/excess liabi lity): $4,000,000 limit per accident for bodily injury and property damage . This requirement may be satisfied by a combination of Auto Liability with Excess or Umbrella, but in no event may the Automobile Liability primary policy limit per occurrence be less than $2,000,000, unless Umbrella/Excess policies feature in ception and expiration dates concurrent with the underlying auto liability polic y, “Follow Form” coverage, and a “Drop Down”.
c. Workers’ Compensation and Employer’s Liability: Statutory Workers’ Compensation limits and Employer’s Liability limits of $1,000,000 per accident.
d. Professional Liability: $2,000,000 each occurrence/aggregate minimum limit per claim. This requirement may be satisfied by a combination of Pr ofessional Liability insurance with Excess or Umbrella policies, but in no event may the Professional Liability primary policy limit per occurrence be less than $2,000,000, unless Umbrella/Excess policies feature inception a nd expiration dates concurrent with the underlying policy, “Follow Form”, and a “Drop Down” provision.
e. Sponsor’s Pollution/Environmental Im pairment Liability: $3,000,000 per occurrence.
This requirement may be satisfied by a combination of Pollution Liability insurance with Excess or Umbrella policies, but in no event may the Pollution Liability primary policy limit per occurren ce be less than $2,000,000, unless Umbrella/Excess policies feature inception and expiration dates conc urrent with the underlying policy, “Follow Form” coverage, and a “Drop Down” provision.
3. Self-Insured Retention
The certificate of insurance must disclose the actual amount of a ny deductible or self- insured retention, or lack thereof, for all coverages required here in. Any self-insured retention or deductible in excess of $50,000 ($100,000 if Sponsor is a publicly-traded
3 company) must be declared to and appr oved by VTA. If Sponsor is a governmental authority such as a state, municipality or speci al district, self-insuran ce is permitted. To apply for approval for a level of retenti on or deductible in excess of $50,000, Sponsor must provide a current financial report incl uding balance sheets and income statements for the past three years, so that VTA can as sess Sponsor’s ability to pay claims falling within the self-insured retention or deductib le. Upon review of the financial report, if deemed necessary by VTA in its sole discretion, VTA may elect one of the following options: to accept the existing self-insured re tention or deductible; require the insurer to reduce or eliminate the self-insured retention or deductible as respects VTA, its directors, officers, officials, employees and volunteers; or to requ ire Sponsor to procure a bond guaranteeing payment of loss es and related investigations, claim administration and defense expenses. Applicable costs resulting therefrom will be bor ne solely by Sponsor.
Sponsor may request execution of a nondisclo sure agreement prior to submission of financial reports.
B. Claims Made Provisions (not applicable to General Liability or Auto Liability) Claims-made coverage is never acceptable for General Liability or Auto Liability. Claims- made may be considered for Professional, Environmental/Pollution, or Cyber Liability. If coverage is written on a claims-made basis, the Certificate of Insurance must clearly state so.
In addition to all other coverage requirements, such policy must provide that:
1. The policy must be in effect as of the date of this Agr eement and the retroactive date must be no later than the date of this Agreement.
2. If any policy is not renewed or the retroactive date of such policy is to be changed, the Sponsor must obtain or cause to be obtai ned the broadest ex tended reporting period coverage available in the commercial in surance market. This extended reporting provision must cover at least two (2) years.
3. No prior acts exclusion may be added to the policy during the contract period.
4. The policy allows for reporting of circumstan ces or incidents that might give rise to future claims.
C. Other Provisions
The policies must contain, or be endorsed to contain, the following provisions:
1. General Liability, Automobile Liabilit y, and Sponsor’s Pollution Liability
a. VTA, its directors, officers, officials, employees and volunteers are to be named as additional insureds as respects: liability arising out of activities performed by or on behalf of the Sponsor, including VTA’s general supervision of the Sponsor; products
4 and completed operations of the Sponsor and its subcontractors; premises owned, occupied or used by the Sponsor; or automobiles owned, leased, hired or borrowed by the Sponsor. The coverage must contain no special limitations on the scope of protection afforded to VTA, its directors, officers, officials, employees, or volunteers.
Additional Insured endorsements must provide coverage at least as broad as afforded by the combination of ISO CG 20 10 10 01 and CG 20 37 10 01.
b. Any failure to comply with reporting pr ovisions of the polic ies may not affect coverage provided to VTA, its directors, officers, officials, employees, or volunteers.
c. Sponsor’s insurance must apply separate ly to each insured ag ainst whom claim is made or suit is brought, except with respect to the limits of the insurer’s liability.
a. The General Liability General Aggregate limit must apply per project, not per policy.
b. The General Liability policy mu st be endorsed to remove the exclusion for railroad liabilities, with coverage at least as broad as afforded by ISO CG 24 17.
2. All Coverages
a. Sponsor’s insurance coverage must be primary insurance as respects VTA, its directors, officers, officials, employees, and volunteers. Self-insurance or insurance that may be maintained by VTA, its direct ors, officers, offici als, employees, or volunteers may apply only as excess to the Sponsor’s insurance. Sponsor’s insurance must not seek contribution from VTA’s insurance program.
b. The insurer must agree to waive all rights of subrogation against VTA, its directors, officers, officials, employees, and voluntee rs for losses arising from work performed by the Sponsor and its subcontractors for VTA
3. Other Insurance Provisions
a. The Certificate must disclose the actual amounts of all deductib les or self-insured retentions.
b. If any coverage forms or endor sements required by this Cont ract are updated by their publishers, whether they be the insurance carrier(s), the Insurance Services office, or the American Association of Insurance Serv ices, during the duration of this Contract, VTA reserves the rights to require the Spons or to procure said coverage forms or endorsements using the updated versions upon the next renewal cycle.
D. Acceptability of Insurers
Insurance and bonds must be placed with insurers with an A.M. Best’s rating of no less than A VII (financial strength rating of no less than A and financial size category of no less than VII), unless specific prior written approval has been granted by VTA.
5 E. Certificates of Insurance
Sponsor must furnish VTA with a Certificat e of Insurance. The certificates for each insurance policy are to be signed by an author ized representative of that insurer. The certificates must be issued on a standard ACORD Form. The Sponsor must instruct their insurance broker/agent to submit all insurance certificates and required notices electronically in PDF format to [email protected] g. All endorsements must be attached to the ACORD certificate in a single PDF document.
The certificates must (1) identify the insurers, the types of insurance, the insurance limits, the deductibles, and the policy term , (2) include copies of all the actual policy endorsements required above, and (3) in the “Certificate Holder” box include:
Santa Clara Valley Transportation Authority (“VTA”)
3331 North First Street
San Jose, CA 95134-1906
In the Description of Operations/Locations/V ehicles/Special Items Box, the VTA Contract number must appear, the list of policies sche duled as underlying on the Umbrella/Excess policy must be listed, Certificate Holder must be named as additional insured, and Waiver of Subrogation must be indicated as endorsed to all policies as stated in the Contract Documents.
It is a condition precedent to award of this Contract that all insu rance certificates and endorsements be received and approved by VTA before Contract execution. No work may be performed until insurance is in full compliance. VTA reserves the rights to require complete, certified copies of all required insurance policies, at any time.
If the Sponsor receives notice th at any of the insurance policie s required by this Exhibit may be cancelled or coverage reduced for any reason whatsoever, Spons or must immediately provide written notice to VTA that such insuranc e policy required by this Exhibit is canceled or coverage is reduced.
F. Maintenance of Insurance
If Sponsor fails to main tain insurance as required herei n, VTA, at its option, may suspend payment for work performed and/or may order the Sponsor to suspend work at Sponsor’s expense until a new policy of insurance is in effect.
Ed. Rev. 10-1-19