Porterville City Council
February 20, 2024

City Council Agenda February 20, 2024

CITY COUNCIL AGENDA
CITY HALL, 291 N. MAIN STREET

PORTERVILLE, CALIFORNIA
FEBRUARY 20, 2024, 5:30 PM
The City of Porterville is allowing for electronic viewing of City Council Meetings. Porterville City Council Meetings will be live streamed on YouTube at
https://www.youtube.com/channel/UC5KuhSrNMNL9nwHJVtnJvvA Alternatively, this meeting will also be available via Zoom as a courtesy using the following information
City of Porterville – City Council Meeting of February 20, 2024 Please use the following link below to join the webinar:
https://us06web.zoom.us/j/83045703020?pwd=UV1dWWhF5wJFjktxWHLV8X1AeTGO0A.QGiY BZFcV9xe5Fc_
Or via Telephone: 1-669-900-6833 Webinar ID: 830 4570 3020 Passcode: 552934 Call to Order
Roll Call

ORAL COMMUNICATIONS
This is the opportunity to address the City Council on any matter scheduled for Closed Session. Unless additional time is authorized by the Council, all commentary shall be limited to three minutes.

CITY COUNCIL CLOSED SESSION:

A. Closed Session Pursuant to:
1 - Government Code Section 54956.95 – Liability Claim: Claimant: Esmeralda Espinoza. Agency claimed against: City of Porterville.

2 - Government Code Section 54956.9(d)(3) – Conference with Legal Counsel – Anticipated Litigation – Significant Exposure to Litigation: Two (2) case in which facts are not yet known to potential plaintiff.
3 - Government Code Section 54956.9(d)(4) – Conference with Legal Counsel – Anticipated Litigation – Initiation of Litigation: Two (2) cases. 6:30 P.M. RECONVENE OPEN SESSION AND REPORT ON REPORTABLE ACTION

TAKEN IN CLOSED SESSION
Pledge of Allegiance Led by Council Member Beltran
Invocation
City Council Agenda February 20, 2024

ORAL COMMUNICATIONS
This is the opportunity to address the Council on any matter of interest, whether on the agenda or not. Please address all items not scheduled for public hearing at this time. Unless additional time is authorized by the Council, all commentary shall be limited to three minutes.

REPORTS
This is the time for all committee/commission/board reports; subcommittee reports; and staff informational items.

I. City Commission and Committee Meetings

1. Parks & Leisure Services Commission - February 1, 2024

2. Library & Literacy Commission - February 13, 2024

3. Arts Commission

4. Animal Control Commission

5. Youth Commission - February 14, 2024

6. Transactions and Use Tax Oversight Committee (TUTOC) II. Staff Informational Reports

1. Water Conservation Phase IV Status Update - January 2024

2. Wall of Fame

3. Youth Field Usage and Light Fees

CONSENT CALENDAR
All Consent Calendar Items are considered routine and will be enacted in one motion. There will be no separate discussion of these matters unless a request is made, in which event the item will be removed from the Consent Calendar. All items removed from the Consent Calendar for further discussion will be heard at the end of Scheduled Matters.

1. Approval of Draft Minutes of February 6, 2024
Re: Considering approval of the City Council draft Minutes of February 6, 2024.

2. Authorization to Purchase Relief Valves for the Compressed Natural Gas Fueling Station
Re: Consideration of purchase of relief valves for the CNG Fueling Station from Surface Pumps, Inc. at a cost not to exceed $19,461.

3. Authorization for Printer/Copier Replacement for the Administration Department Re: Council authorization to purchase a copy machine for the Administration Department from California Business Machines utilizing Department budgeted funds in the amount of $9,500.00, plus the applicable sales tax.

4. Authorization to Repair City Well No. 7
Re: Consideration of approval for the repair of City Well 7 located on the Northeast corner of Orange Avenue and South Western Street by S.A. Camp Pump And Drilling, for an amount not to exceed $10,330.

City Council Agenda February 20, 2024

5. Intent to Set a Public Hearing - Vacation of a Portion of College Avenue Re: Consideration to approve the draft resolution of intent to abandon a portion of College Avenue; and set the Council Meeting of March 19, 2024, as the time and place for the Public Hearing.

6. Permanent Local Housing Allocation (PLHA) – Request for Proposals (RFP) Funding Recommendations
Re: Considering approval to award PLHA funds totaling $174,048.27 to Central California Family Crisis Center ($54,973.53), Family Services of Tulare County ($12,894) and Kings View ($106,180.74) for Permanent Supportive Housing Operations, Navigation Center Operations and Emergency & Bridge Housing Operations.

7. Consideration of Updated Statement of Investment Policy Re: Consideration to adopt the draft resolution approving the updated Statement of Investment Policy.

8. Community Clean-Up Events
Re: Council Authorization to approve Community Clean-Up Events for Spring and Fall

9. Status and Review of Local Drought Emergency
Re: Considering approval of the continuance of the Declaration of Local Emergency.

SCHEDULED MATTERS

11. Consideration of Appointment of City Representative on Porterville Flag Day Committee
Re: Considering appointing Council Member Greg Meister to serve as a City Representative on the Porterville Flag Day Committee.

12. Animal Services Contracts with the Cities of Lindsay and Woodlake Re: Consideration to terminate the current Agreements for Animal Shelter Services between the City of Porterville and the Cities of Lindsay and Woodlake.

13. Status and Review of Declaration of Local Flood Emergency Re: Review of the Declaration of Local Emergency made on March 13, 2023, concerning the significant weather event and impacts or likely impacts relative to increased flow of the Tule River.

AB 1234 REPORTS
This is the time for all AB 1234 reports required pursuant to Government Code § 53232.3.

1. TCAG-California Association of Councils & Government Annual Conference - February 7-9, 2024

2. Porterville Area Development Authority (PADA) - February 16, 2024

ORAL COMMUNICATIONS

OTHER MATTERS

CLOSED SESSION
City Council Agenda February 20, 2024

Any Closed Session Items not completed prior to 6:30 p.m. will be considered at this time.

ADJOURNMENT - to the meeting of March 5, 2024, at 5:30 P.M.

In compliance with the Americans with Disabilities Act and the California Ralph M. Brown Act, if you need special assistance to participate in this meeting, or to be able to access this agenda and documents in the agenda packet, please contact the Office of City Clerk at (559) 782-7464.

Notification 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting and/or provision of an appropriate alternative format of the agenda and documents in the agenda packet.

Materials related to an item on this Agenda submitted to the City Council after distribution of the Agenda packet are available for public inspection during normal business hours at the Office of City Clerk, 291 North Main Street, Porterville, CA 93257, and on the City’s website at www.ci.porterville.ca.us.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: 1. Water Conservation Phase IV Status Update - January 2024 SOURCE: Public Works
COMMENT: The City has continued to implement an active water conservation approach, conserving and providing flexibility to the community. The City transitioned from Phase III to Phase IV of the City's Water Conservation Plan as of October 1, 2023. The Water Conservation Plan applies to all municipal water users within or outside the city limits.

The Phase IV plan reduces outdoor watering to one day per week, with "odd" addresses allowed to water on Saturday and "even" addresses allowed to water on Sunday. Outdoor watering is prohibited between the hours of 5 a.m. to 10 a.m. and 5 p.m. to 10 p.m., with no watering allowed on Monday, Tuesday, Wednesday, Thursday, or Friday. Watering outdoor landscaping is prohibited during and within forty-eight (48) hours after measurable rainfall, which is now defined as greater than 0.01 inch.

Violations of prohibited activities are considered infractions and are punishable by fines of up to $500 for each day the violation occurs. Any peace officer or employee of a public agency charged with enforcing laws and authorized to do so by ordinance may issue a citation to the violator. The City will respond to enforcement by issuing a Notice of Violation for all witnessed occurrences, and staff will process all reported issues. Enforcement statistics for January 2024 show that eight (8) notices of violations were issued for water wasting, and three (3) administrative citations were issued.

Water production for January 2024 reflects a four percent (4%) increase from the 5-year average. The monthly production for January was 213 million gallons, which is a six percent (6%) increase compared to January 2013 at 200 million gallons. Residential consumption for January 2023 was 79 gallons per capita per day (GPCD).

Compliance with individual water supplier conservation requirements is based on cumulative savings. Cumulative tracking means that conservation savings will be added together from one month to the next and compared to the amount of water used during the same months in 2013. City Staff will evaluate conservation totals in two formats: 1) Calculate the cumulative conservation totals for production as compared to production in 2013, and 2) Calculate cumulative conservation totals in relation to GPCD in efforts to evaluate population growth impacts on production as compared to 2013. The cumulative total production for the City of Porterville's conservation efforts will be reflected from January 2015 through January 2024. Porterville's cumulative total production conservation through January 2024 is twenty percent (20%).

The cumulative total of GPCD for the City of Porterville's conservation efforts will be reflected from January 2015 through January 2024. Porterville's cumulative total GPCD conservation through January 2024 is twenty-five percent (25%).

Under the February 2, 2016, emergency regulation, the City of Porterville received a revised conservation standard of twenty-eight percent (28%) with an additional two percent (2%) reduction for climate adjustment, making the City’s conservation standard twenty-six percent (26%). After reviewing the Water Board's Self-Certification criteria for drought impacts on water supplies, the City Council approved maintaining a self-imposed standard of twenty-six percent (26%). The continuation of the current conservation goal keeps a standardized message that the City has worked to develop in public outreach, provides resiliency and capacity to ensure three years of supply under drought conditions, and meets the minimum twenty percent (20%) conservation standard defined in the City's Urban Water Management Plan, and assists the City in meeting the requirements of the Sustainable Groundwater Management Act (SGMA).

The State Water Board requires monthly reporting to track what agencies are doing and how they perform throughout the year. Proposed permanent regulations will require agency reporting to continue to monitor the performance of urban water conservation with a preparedness to implement conservation standards as necessary. California Governor Gavin Newsom signed Executive Order N-10-21 on July 8, 2021, urging all Californians to voluntarily reduce their water use by fifteen percent (15%) compared to their prior-year levels due to excessive drought conditions. Water production for the City system shows a sixteen (16%) increase from January 2023 to January 2024. California Governor Gavin Newsom issued another Executive Order N-7- 22 on March 28, 2022, to address drought conditions after the driest first three months of a year in recorded history. EO N-7-22 requires that each water supplier implements, at a minimum, the shortage response actions adopted under section 10632 of the Water Code for a shortage level of up to twenty percent (20%). The City of Porterville's Water Conservation Plan Phase III meets the requirements for this shortage (Level 2). California Governor Gavin Newsom signed Executive Order N-3-23 on February 13, 2023, stating the state has experienced one of the wettest three-week periods on record. With this order, California Governor Gavin Newsom removed the need to voluntarily reduce water use by fifteen percent (15%), as stated in the previous Executive Order N-10-21.

RECOMMENDATION: Information Only
ATTACHMENTS: 1. Monthly Production Status January 2024

2. Monthly Production Status GPCD January 2024

3. Drought Response Phase IV Flyer
Appropriated/Funded:

Review By:

Department Director:

Michael Knight, Public Works Director
Final Approver: Patrice Hildreth, City Manager
0 100
200
300
400
500
600
1 2 3 4 5 6 7 8 9 10 11 12 Million Gallons/Month
Monthly Production Status & Cumulative Total June 2015 Through January 2024 Production Comparison to 2013 & 5 Year Average 2013
2020
2021
2022
2023
2024
5 Year AVG

0.00 25.00

50.00 75.00
100.00
125.00
150.00
175.00
200.00
225.00
1 2 3 4 5 6 7 8 9 10 11 12 Gallons Per Capita Day
Month
Monthly Production Status & Cumulative Total June 2015 Through January 2024 Gallon Per Capita Day Comparison to 2013 & 5 Year Average 2013
2020
2021
2022
2023
2024
5 Year AVG
The City of Porterville has adopted Phase IV of its Drought Response Plan.

As part of the Phase IV plan, the City has restricted watering days to one day per week, based on address.

Mandatory
Odd/Even Watering
Schedule
Excessive water
runoff prohibited
The washing of
sidewalks and driveways
is prohibited
Vehicles shall only be
washed on designated
watering days and with
hoses equipped with a
shut-off nozzle
Ornamental water
features are prohibited
unless the fountain uses
a recycling system

WATERING PROHIBITED

BETWEEN THE HOURS OF
5:00 – 10:00 AM
5:00 – 10:00 PM

NO WATERING

MONDAY THROUGH
FRIDAY.

ODD NUMBER ADDRESSES
If your address ends with an
“odd” number, 1, 3, 5, 7, or 9,
your watering day is Saturday only.

EVEN NUMBER ADDRESSES
If your address ends with an
“even” number, 0, 2, 4, 6, or 8,
your watering day is Sunday only.

OR
Item No.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: 2. Wall of Fame
SOURCE: Parks and Leisure Services
COMMENT: On an annual basis, the City of Porterville's Wall of Fame selections are announced. The Wall of Fame is a dedicated section of the east hallway in City Hall to honor and recognize individuals for their significant efforts and service to the Porterville community. On February 6, 2024, City Council authorized a one-time exception to the Wall of Fame criteria to allow for a Council Member to select more than one honoree, and for the honoree to not have lived in the Porterville area for a minimum of fifteen (15) years. The Wall of Fame honorees for 2024 are as follows:

Mayor Flores: John Lollis
Vice Mayor Carrillo: Stanley Jay Santos, Sr.

Council Member Beltran: Ramon Figueroa, Patrick Jones
Council Member Meister: Ed Flory
Council Member Weyhrauch: Brent Gill
The 2024 honorees will be inducted into the Wall of Fame at a ceremony on Friday, March 8, 2024, beginning at 12:00 PM at Centennial Park.

RECOMMENDATION: Informational only
ATTACHMENTS: 1. Wall of Fame Honorees through 2023
Appropriated/Funded:

Review By:

Department Director:

Donnie Moore, Parks and Leisure Services Director
Final Approver: Patrice Hildreth, City Manager
City of Porterville Wall of Fame Honorees
Carmen Martinez Eoff 2007 Michael R. Garcia 2017
Frank “Buck” Shaffer 2007 Bob Perez 2017
Edward B. “Ted” Cornell 2008 Jim Winton 2017
Jim Maples 2010 Richard B. Hatfield 2018
Roy Rockholt 2010 Todd ‘Hoss’ McNutt 2018
James Cone 2011 Teddy Wong 2018
Mona Gauger 2011 Denise Howell Marchant 2019
Brett Land 2011 Raymond Camarena 2019
Forrest ‘Doc’ Mock 2011 Doug Webb 2019
Alice Seal 2011 Grace Muñoz Rios 2019
Estha Mae Hinton 2012 James Kusserow 2019
Teresa Jackson 2012 Linda M. Camarena 2020
William Rogers 2012 Joe Carrillo, Jr. 2020
Orlin and Louise Shires 2012 Roberto da la Rosa, Sr. 2020 Waltraut Wilson 2012 Jim Holly 2020
Mary Hamner Baker 2013 Joe Ruiz, Jr. 2020
Robert Decker Christenson 2013 Janice Castle 2021
Cyrille Faure 2013 Teresa A. de la Rosa-Garcia 2021
Vivian Josten Lucey 2013 Jeff Edwards 2021
Emogene McCullar 2013 Virginia R. Gurrola 2021
George Overcash 2013 Gang Sue 2021
Clara Wilcox Rutherford 2013 Nicki Edwards 2022
Lester James Hamilton 2014 Cynthia Garcia Brown 2022
William ‘Bill’ Horst 2014 Daniel Hackey 2022
Guy Huffaker 2014 George Tanimoto 2022
Marlene Marquez 2014 Barbara Wong Sue 2022
Monte Moore 2014 Don Dowling 2023
Theodore Ensslin 2015 David Gong 2023
Pete V. McCracken 2015 Cameron James Hamilton 2023
Myron Wilcox 2015 Maria Christina Roman 2023
Gilbert Yniguez 2015 Milt Stowe 2023
Judith A. Gibbons 2016
James E. Howell 2016
Philip D. Hunter 2016
Judge Glade F. Roper 2016
Steven E. Tree 2016
Elva Beltran 2017
Joseph Faure, Jr. 2017
CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: 3. Youth Field Usage and Light Fees
SOURCE: Parks and Leisure Services
COMMENT: In 1995, the City of Porterville and Burton School District entered into a twenty-five (25) year agreement regarding the use of the two baseball fields at Burton Elementary School. The City constructed the two ballfields, installed lighting for both fields, constructed a parking lot, and added bleachers. Under the terms of the Agreement, except for Burton's use during normal school hours and scheduled after-school events, the City would solely be responsible for the scheduling of the fields.

The City of Porterville and Burton School District drafted two new Agreements in 2021. One agreement was between the Burton School District and the City of Porterville. The other agreement included Burton School District, the City of Porterville, and Porterville Little League (PLL). This five (5) year Agreement that included PLL authorizes PLL to utilize the Burton Ballfields with the City being the scheduling agent. In this agreement, the City is responsible for all costs associated with the maintenance and repair of lighting. PLL is responsible for maintaining the fields and surrounding areas during their scheduled playing period.

The City's current fee for youth athletic field usage, which has been in place since 2009, is $15 per field per day. The current fee for youth athletic field light usage is $10 per hour, which has been in place since 2014.

RECOMMENDATION: Informational only
ATTACHMENTS: 1. Regional Youth Field Usage and Light Fees

2. Burton Ballfields Agreement with Burton and City

3. Burton Ballfields Agreement with Burton City PLL
Appropriated/Funded:

Review By:

Department Director:

Donnie Moore, Parks and Leisure Services Director
Final Approver: Patrice Hildreth, City Manager
Youth Athletic Field Usage and Light Fees

CITY FIELD USAGE FEE LIGHT FEE
Porterville $15 per day $10 per hour
Corcoran $22 per hour $30 per hour
Dinuba $24 per hour $10 per hour
Exeter $20 per game $15 per hour
Kerman $85 per day $10 per hour
Lindsay $50 per game n/a
Madera $12.50 per hour $32.50 per hour
Tulare Little League owns its fields
Visalia $16 per hour $19 per hour

Item No. 1.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: Approval of Draft Minutes of February 6, 2024
SOURCE: Administrative Services
COMMENT: Presented for Council's approval are the draft Minutes of February 6, 2024.

RECOMMENDATION: That the Council approve the draft Minutes of February 6, 2024.

ATTACHMENTS: 1. Draft Minutes 02-06-2024
Appropriated/Funded:

Review By:

Department Director:

Yuliana Andrade, Acting Administrative Services Director Final Approver: Fernando Gabriel-Moraga, Acting Chief Deputy City Clerk

CITY COUNCIL MINUTES
CITY HALL, 291 N. MAIN STREET

PORTERVILLE, CALIFORNIA
FEBRUARY 6, 2024, 5:30 PM
Call to Order at 5:30 p.m.

Roll Call: Council Member Greg Meister, Council Member Raymond Beltran, Council Member Donald Weyhrauch, Vice Mayor Kellie Carrillo, Mayor Martha A. Flores

ORAL COMMUNICATIONS
None.

CITY COUNCIL CLOSED SESSION:

A. Closed Session Pursuant to:
1 - Government Code Section 54956.9(d)(1) – Conference with Legal Counsel – Existing Litigation: Rae Dean Strawn v. City of Porterville, United States District Court, Eastern District of California, Case No. 1:22-cv-1245 ADA-EPG.
2 - Government Code Section 54956.9(d)(1) – Conference with Legal Counsel – Existing Litigation: Eduardo Velasquez, Jr. v. City of Porterville, Tulare County Superior Court Case No. VCU304120.
3 - Government Code Section 54956.9(d)(1) – Conference with Legal Counsel – Existing Litigation: Yesenia Flores v. City of Porterville et al., Tulare County Superior Court Case No. PCU304121.
4 - Government Code Section 54956.9(d) (3) – Conference with Legal Counsel – Anticipated Litigation – Significant Exposure to Litigation: One (1) case in which facts are not yet known to potential plaintiff.
5 - Government Code Section 54956.9(d)(4) – Conference with Legal Counsel – Anticipated Litigation – Initiation of Litigation: Three (3) cases. 6:30 P.M. RECONVENE OPEN SESSION AND REPORT ON REPORTABLE ACTION

TAKEN IN CLOSED SESSION
City Attorney Lew reported that no action had taken place during Closed Session.

The Pledge of Allegiance was led by Council Member Meister Invocation – a member of the public came forward to give an invocation.

PRESENTATIONS

Swearing In Ceremony - Patrice Hildreth, City Manager
Strathmore Spartan Football State Championship
Focused General Plan Update
Southern California Edison Presentation - Brian Thoburn

ORAL COMMUNICATIONS
• Frank Rodriguez, Porterville Little League, spoke of the hardships of the Porterville Little League (PLL) and asked if the council would consider assisting the PLL with financial assistance.
• John Coffee, Porterville, spoke of the decorative lighting around Monache and commended the council on their progressive thinking on Item No. 13. • Brock Neeley, Porterville, stated the easiest way to fix Item No. 13, is to follow the 10th Amendment to the Constitution.
• Jean Vafeades, Porterville, expressed her opposition of Item No. 13. • Ed McKervey, Porterville, expressed his support of Item No. 13. • Ryan Leasure, Porterville Chamber of Commerce, provided council with recent and upcoming events.
• Korey Wells, Porterville, expressed his support for Item No. 13. • Josh Flowers, Strathmore, spoke of his past involvement with the Porterville Little League and expressed his support of Item No. 13.

REPORTS
I. Staff Informational Reports
Charitable Car Washes Quarterly Report Calendar Year 2023 Code Enforcement Quarterly Report
Building Permit Activity Quarterly Report FY 2023-2024 (October - December 2023) Street Performance Measure Quarterly Report FY 2023-2024 (October - December 2023) Golf Course Quarterly Report FY 2023-2024 (October-December 2023) City Commission And Committee Attendance Quarterly Report FY 2023-2024 (October - December 2023)
City Council Member Appointments Attendance Quarterly Report FY 2023-2024 (October - December 2023)

CONSENT CALENDAR
There were no items pulled from the Consent Calendar for discussion.

COUNCIL ACTION: MOVED by Council Member Beltran, SECONDED by Council Member Weyhrauch that the City Council approve Items Nos. 1-11. The motion carried unanimously.

1. AUTHORIZATION TO REPAIR CITY WELL NO. AP-2
Recommendation: That City Council:

1. Direct the Finance Director to initiate a Purchase Order to Mario Sagredo Electrical for an amount not to exceed $14,999 (inclusive of all parts, taxes, labor and contingency) for the repair of City Well No.AP-2; and

2. Direct the Finance Director to make payment to Mario Sagredo Electrical upon receipt of the invoice approved by the Public Works Director.

Documentation: M.O. 01-020624
Disposition: Approved.

2. AUTHORIZATION TO DISTRIBUTE A REQUEST FOR PROPOSALS FOR

ART COMPONENT OF SANTA FE BYWAY PROJECT
Recommendation: That City Council authorize staff to distribute a Request for Proposals for the public art component of the Santa Fe Byway Project in the general area on the Rails to Trails Parkway between Henderson Avenue (to the north) and E Walnut Avenue (to the south).

Documentation: M.O. 02-020624
Disposition: Approved.

3. THURMAN AVENUE & THIRD STREET STORM DRAIN PROJECT
Recommendation: That the City Council:

1. Authorize an appropriation in the amount of $418,000 from Local Transportation Fund (LTF); and

2. Authorize an appropriation in the amount of $121,000 from the Sewer Revolving Fund (SRF).

Documentation: M.O. 03-020624
Disposition: Approved.

4. AUTHORIZATION TO PROCURE LABOR AND MATERIALS THROUGH AN

OPEN MARKET PROCESS TO COMPLETE THE CITY POOL

IMPROVEMENTS PROJECT
Recommendation: That the City Council:

1. Adopt the Resolution Authorizing the Procurement of Bids through an Open Market Process for the City Pool Improvements Project; and

2. Authorize staff to make payments up to 100% upon satisfactory completion of all work.

Documentation: Resolution No. 03-2024
Disposition: Approved.

5. AUTHORIZATION TO USE GENERAL FUND - ANIMAL SHELTER
Recommendation: That the City Council approve the draft resolution authorizing an appropriation of $1,800,000 from the Capital Construction/Improvement

Designated Fund to fund the project with the proceeds from the land sale of the Animal Shelter in Lindsay and anticipated donations being planned for reimbursement to said fund.

Documentation: Resolution No. 04-2024
Disposition: Approved.

6. FINANCIAL STATUS REPORTS
Recommendation: That the City Council accept the Financial Status Reports as presented.

Documentation: M.O. 04-020624
Disposition: Approved.

7. QUARTERLY INVESTMENT PORTFOLIO
Recommendation: That the City Council accept the quarterly Investment Portfolio Summary Report.

Documentation: M.O. 05-020624
Disposition: Approved.

8. REQUEST FOR PROCLAMATION - RED CROSS MONTH - MARCH 2024 Recommendation: That the City Council consider approval of the request to proclaim the month of March 2024, as "Red Cross Month" in the City of Porterville.

Documentation: M.O. 06-020624
Disposition: Approved.

9. APPROVAL OF COMMUNITY CIVIC EVENT - PORTERVILLE CHAMBER OF COMMERCE - SPRING FESTIVAL - APRIL 13, 2024
Recommendation: That the City Council approve the Community Civic Event Application submitted by the Porterville Chamber of Commerce to hold the Porterville Chamber Spring Festival event on April 13, 2024, subject to the restrictions and requirements contained in the Application and Agreement, Exhibit A, Exhibit B, and Exhibit C.

Documentation: M.O. 07-020624
Disposition: Approved.

10. AUTHORIZATION OF TEMPORARY OVERFLOW PARKING AT THE

SPORTS COMPLEX FOR EAGLE MOUNTAIN CASINO SPECIAL EVENTS

Recommendation: That the City Council authorize City staff to approve Eagle Mountain Casino requests for temporary use of the Sports Complex parking lot during special events based on conditions set forth by the City.

Documentation: M.O. 08-020624
Disposition: Approved.

11. STATUS AND REVIEW OF LOCAL DROUGHT EMERGENCY
Recommendation: That the City Council receive the report of status and review of the Declaration of Local Emergency and determine the need exists to continue said Declaration.

Documentation: M.O. 09-020624
Disposition: Approved.

SCHEDULED MATTERS

12. CONSIDERATION OF APPOINTMENT TO THE PARKS & LEISURE

SERVICES COMMISSION
Recommendation: That the City Council consider the appointment of Blain Smothermon to the Parks & Leisure Services Commission to serve the remainder of a threeyear term to expire October 2027.

City Manager Hildreth introduced the item and Acting Administrative Services Director Yuliana Andrade presented the staff report.

COUNCIL ACTION: MOVED by Mayor Flores, SECONDED by Vice Mayor Carrillo that the City Council appoint Blain Smothermon to the Parks and Leisure Services Commission . The motion carried unanimously.

Documentation: M.O. 10-020624
Disposition: Approved.

13. CONSIDERATION OF ADOPTION OF DRAFT RESOLUTION OF THE CITY

COUNCIL OF THE CITY OF PORTERVILLE AFFIRMING ITS COMMITMENT

TO THE PRINCIPLES OF LIBERTY AND MEDICAL FREEDOM
Recommendation: That the City Council consider the draft Resolution of the City Council of the City of Porterville Affirming its Commitment to the Principles of Liberty and Medical Freedom.

City Manager Hildreth introduced the item and City Attorney Lew presented the staff report.

Council Member Meister commended City Attorney Lew for drafting the resolution and suggested amendments to the second paragraph.

Several council members voiced their concerns about the resolution, stating that it was irrelevant to city matters and that the Attorney time could have been more effectively utilized to tackle pressing city issues.

COUNCIL ACTION: MOVED by Council Member Meister, SECONDED by Council Member Beltran that the City Council approve the item with the added amendment noted by Council Member Meister.

AYES: Meister, Beltran
NOES: Weyhrauch, Carrillo, Flores
ABSTAIN: None
ABSENT: None
Documentation: M.O. 11-020624
Disposition: Motion Failed

14. CONSIDERATION OF THE WALL OF FAME POLICY
Recommendation: That the City Council consider the Wall of Fame Policy and provide direction to staff.

City Manager Hildreth introduced the item and Parks and Leisure Services Director Donnie Moore presented the staff report.

During their conversation, the Council members came to a consensus that a one-time exception would be voted on and that Fire Captain Raymond Figueroa and Firefighter Patrick Jones would be considered for the Wall of Fame. Furthermore, the policy would be revisited in a future meeting to explore the potential of incorporating a Public Safety section.

COUNCIL ACTION: MOVED by Mayor Flores, SECONDED by Council Member Beltran that the City Council approve the one-time exemption to allow for the inclusion of Fire Captain Raymond Figueroa and Firefighter Patrick Jones to the Wall of Fame. The motion carried unanimously.

Documentation: M.O. 12-020624
Disposition: Approved.

15. STATUS AND REVIEW OF DECLARATION OF LOCAL FLOOD

EMERGENCY
Recommendation: That the City Council receive the report of status and review of the Declaration of Local Emergency and determine the need exists to continue said Declaration.

City Manager Hildreth introduced the item and presented the staff report.

COUNCIL ACTION: MOVED by Vice Mayor Carrillo, SECONDED by Council Member Beltran that the City Council approve the continuance of the Declaration of Local Flood Emergency. The motion carried unanimously.

Documentation: M.O. 13-020624
Disposition: Approved.

AB 1234 REPORTS

1. Tulare County Task Force on Homelessness - January 17, 2024 Mayor Flores provided a report on the attendees, the approval of the Minutes, an update on the Task Force on Homelessness members, and updates from the community.

2. Tulare County Association of Governments (TCAG) - January 22, 2024 Mayor Flores provided a report on the attendees, the Transportation Consent Calendar, and the approval of various resolutions.

3. Tulare County Economic Development Corp. (TCEDC) - January 24, 2024 Mayor Flores reported on those in attendance, the approval of minutes and financials, and project and client services update.

4. The Mighty 190 Committee - January 24, 2024
Council Member Meister reported on those in attendance, the review of expenditures and funding, a discussion of marketing strategies, road closure updates, and a roundtable discussion related to saving the red woods.

5. Internal City Audit Committee - January 24, 2024
Mayor Flores reported on the approval of minutes, the review and update on the investment policy, and the review of the process by which community civic events are held within the city.

6. TCAG Sustainable Corridor Committee - January 25, 2024 Deputy City Manager Ridenour stated that the meeting was a roundtable discussion of updates about the sustainable corridor projects within the City of Porterville.

7. Tulare County Regional Transit Authority (TCRTA) - January 29, 2024 Council Member Weyhrauch stated there was discussion of Porterville's withdrawal from the TCRTA and several reports from the safety committee, as well as a presentation on organizational issues.

8. Eastern Tule Groundwater Sustainability Agency (ETGSA) – February 1, 2024 Council Member Weyhrauch reported on public comments, announcements, the approval of the Minutes, the ratification of pending bills, and various administrative action items and updates.

ORAL COMMUNICATIONS
None.

OTHER MATTERS
• Council Member Beltran expressed gratitude towards city staff for their efforts during the recent heavy rainstorm, spoke of his attendance to the Porterville Library's 115th Anniversary, and the Fire Department's Badge Pinning Ceremony. He also commented on the pleasure of seeing Strathmore High School earlier in the meeting, and indicated his desire to review the Porterville Little League's agreement.
• Council Member Weyhrauch expressed gratitude to all family members who offer support to City of Porterville employees. Additionally, he inquired whether the city's Facebook page shares chamber information and extended appreciation to the public for attending council meetings and voicing their concerns. Council Member Weyhrauch also reported that he had not observed a significant amount of debris on the roads following the storm, and suggested that the city should consider reviewing the charter and look to increasing the Mayor's salary to recognize the extensive business responsibilities she handles. • Council Member Meister indicated that he supported Council Member Weyhrauch's idea of reviewing the charter and added that the people should be able to vote in the mayor, stated he would also like to review the Porterville Little League agreement, and spoke of his attendance to a chamber Black Tie Event, Fire Department and Police Department Badge Pinning Ceremony, and a police ride along. In addition, Council Member Meister asked the council if they would appoint him to the Flag Day Committee and consider the appointment at a future meeting.

COUNCIL ACTION: MOVED by Mayor Flores, SECONDED by Council Member Beltran that the City Council approve Council Member Meister’s request to bring an item to a future meeting to consider his appointment to the Flag Day Committee. The motion carried unanimously.

Documentation: M.O. 14-020624
Disposition: Approved.
• Vice Mayor Carrillo expressed her appreciation for Mayor Flores for her involvement in city business, congratulated new City Manager Patrice Hildreth, spoke of her attendance to the Libraries 115th year celebration, and stated she would also like to review the current Porterville Little League fees.
• Mayor Flores congratulated the new Finance Director Janie Rodriguez, congratulated all Porterville Chamber Award recipients, and spoke of her attendance to the Fire & Police Department Badge Pinning Ceremonies, the Porterville College Facilities Master Plan meeting, the Tule River Tribe Council Swearing In Ceremony, a Special City Council Meeting, and the Library 115th year celebration.
• City Manager Patrice Hildreth expressed her gratitude towards the city council for their trust in her abilities and for their dedication to the city and its community. City Manager Hildreth also mentioned that she feels humbles and honored to work with such skilled individuals.

CLOSED SESSION
None.

ADJOURNMENT
The Council adjourned at 9:02 p.m. to the meeting of February 20, 2024, at 5:30 p.m.

Fernando Gabriel-Moraga,
Acting Chief Deputy City Clerk
SEAL
Martha A. Flores, Mayor
Item No. 2.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: Authorization to Purchase Relief Valves for the Compressed Natural Gas Fueling Station
SOURCE: Public Works
COMMENT: As a result of safety certification requirements, the high-pressure relief valves for the City's Compressed Natural Gas (CNG) fueling station must be replaced or recertified annually. Staff requests to purchase a set of the necessary relief valves in order to expedite the process. In the future, the secondary set of valves can be sent for recertification while the CNG station remains available to fuel our fleet as well as public vehicles.

Attempts were made to obtain quotes from local vendors, Archrock, Cal Valley Equipment, and Surface Pumps, Inc. However, Surface Pumps, Inc. was the only vendor to respond with an estimate and the ability to provide the valves in the required time frame. A full set of valves for the three storage vessels, as well as full sets for both compressors, is estimated to cost $19,461 (inclusive of all parts, taxes, freight, and a 10% contingency).

This is a high priority repair as the majority of the City Refuse fleet, part of the Transit fleet, and other outside agencies depend heavily on this CNG fueling station operating at peak capacity. Funding is available from the Shop Equipment Maintenance Fund.

RECOMMENDATION: That the City Council:

1. Authorize the purchase of relief valves for the CNG Fueling Station from Surface Pumps Inc. at a cost not to exceed $19,461 (inclusive of all parts, taxes, freight, and a 10% contingency); and

2. Authorize payment of said repair upon satisfactory receipt of parts.

ATTACHMENTS: 1. City Of Porterville Relief Valves Quote Appropriated/Funded:

Review By:

Department Director:

Michael Knight, Public Works Director
Final Approver: Patrice Hildreth, City Manager
Item No. 2.

SOLD TO: SHIP TO:

City of Porterville
291 N. Main St.
[email protected]
CNG/AnnualReliefValveChange/PM
Porterville, CA 93257
City of Porterville
291 N. Main St.
[email protected]
Porterville, CA 93257
Page: 1
ORDER NUMBER:

ORDER DATE:

SALESPERSON:

CUSTOMER NUMBER:
0106598
1/12/2024
01-CITYOFP
Surface Pumps, Inc.

PO BOX 5757
Bakersfield, CA 93388-5757
(661) 393-1545
01-ER

ESTIMATE
CONFIRM TO:

ITEM NUMBER AMOUNT U/M ORDERED SHIPPED BACK ORDER PRICE TBD Net 30 days
CUSTOMER PO ORDER TYPE F.C.A. TERMS /COMMENT
FCD/AnnualReliefValveChange/PM

SHIP VIA
11-91-12E51T58I1 EACH
Whse: 001

2.00 0.00 0.00 850.77 1,701.54

RELIEF VALVE
11-91-12D51T09I1 EACH
Whse: 001

2.00 0.00 0.00 686.15 1,372.30

RELIEF VALVE
11-91-12D51T09I1350 EACH
Whse: 001

2.00 0.00 0.00 686.00 1,372.00

RELIEF VALVE
11-91-12D51T09I1275 EACH
Whse: 001

2.00 0.00 0.00 686.15 1,372.30

RELIEF VALVE
11-91-12C61P60C1 EACH
Whse: 001

2.00 0.00 0.00 1,210.77 2,421.54

RELIEF VALVE
11-91-M2C61P6941 EACH
Whse: 001

2.00 0.00 0.00 1,590.77 3,181.54

RELIEF VALVE
11-91-M2C61P69415000 EACH
Whse: 001

3.00 0.00 0.00 1,590.77 4,772.31

RELIEF VALVE
/S&H 0.00

SHIPPING & HANDLING
NET ORDER: 16,193.53
DISCOUNT: 0.00
FREIGHT: 0.00
SALES TAX: 0.00
ORDER TOTAL: 16,193.53
ACCEPTED & APPROVED: DATE:

The signature authorizes Surface Pumps, Inc. to charge interest on outstanding balances, if not paid within the terms stated on the Invoice, at a rate of 1.5% per month (18% per annum) or to the extent permitted by law.

Item No. 3.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: Authorization for Printer/Copier Replacement for the Administration Department
SOURCE: Administrative Services
COMMENT: The Administration Department currently has a commercial-grade Kyocera printer/copier/scanner, which is a 55-page-per-minute black and white model.

This current printer has been in service for ten (10) years and due to its age, as well as ever-changing technology, servicing this item and obtaining parts to repair it is very expensive and difficult, if not in some cases impossible.

Therefore, staff is seeking to replace it with a printer also capable of color printing.

California Business Machines is an established City vendor and authorized seller of Kyocera and operates under OMNIA Contract Pricing. Staff received a quote from California Business Machines for a TA 6054ci Color MFP, which has the same features as the current model, with the exception that it operates in color and is a 60-page-per-minute model. Based on the Department’s past year's average monthly volume of 13,000 pages per month, this model is suitable for speed and durability. This 60-page-per-minute speed model is rated to perform well with this volume range and much more.

California Business Machines has a Cost Per Page for Full-Service Maintenance Prices. However, as long as the City continues to have its copiers serviced through California Business Machines, they will bill for the Department’s actual use each month - and not require the minimum base mentioned.

The City was provided Kyocera's OMNIA Cooperative Contract Pricing for the model that meets the Department’s needs. OMNIA Partners, Public Sector is an experienced cooperative purchasing organization for state and local governments. The Kyocera OMNIA Cooperative Contract has been competitively solicited and publicly awarded, providing the lowest pricing while eliminating the need for multiple pricing or bids. California Business Machines works in conjunction with OMNIA and is honoring the OMNIA Competitive Contract pricing. This allows California Business Machines to invoice, service, and support the printer directly.

Staff is requesting to purchase the Kyocera TA 6054ci from California Business Machines for the amount of $9,500.00, plus the applicable sales tax. Funds for this purchase are available in the Administration Department’s operating budget.

Item No. 3.

RECOMMENDATION: That the City Council approve the purchase of a copy machine for the Administration Department from California Business
Machines utilizing Department budgeted funds in the amount of $9,500.00, plus the applicable sales tax.

ATTACHMENTS: 1. Kyocera TA 6054ci - City of Porterville Quote Appropriated/Funded:

Review By:

Department Director:

Yuliana Andrade, Acting Administrative Services Director Final Approver: Patrice Hildreth, City Manager
PROPOSAL for Sarai Vargas, City of Porterville HR Division to replace CP05 Kyocera TA 5501i B/W February 12, 2024
KYOCERA TA 6054ci Color Copier/MFP
FEATURES:
• 60 PAGES PER MINUTE B/W and COLOR
• STANDARD NETWORK PRINT, COPY, SCAN AND NETWORK FAX
• NEW 10.1” COLOR TOUCH SCREEN PANEL
• USB HOST INTERFACE / PRINT FROM AND SCAN TO USB MEMORY DEVICES • APP WHICH ALLOWS YOU TO PRINT FROM AND SCAN TO APPLE & ANDROID DEVICES • KYOCERA’S HyPAS ALLOWS ACCESS TO MANY POWERFUL BUSINESS APPLICATIONS • APPLE AIRPRINT/GOOGLE CLOUD PRINT/KYOCERA MOBILE PRINT • 320 SHEET DUAL SCAN DOCUMENT PROCESSOR (Scans Up to Images Per Minute) • 1,000 SHEET ALL POSITION STAPLING FINISHER
• STACKLESS DUPLEX UNIT (Up to 999 2-Sided Copies Per Scan) • 5 WAY PAPER FEED (4,150 Sheets)
• 2-500 SHEET USER ADJUSTABLE DRAWERS (Up to 140 Lb. Index Stock) • 150 SHEET MULTI-PURPOSE ADJUSTABLE BYPASS (Up to 110 Lb. Cover Stock) • DUAL-1,500 SHT LETTER SIZE DRAWERS
• 1200 X 1200 DPI UNENHANCED PRINT RESOLUTION; 4800 X 1200 ENHANCED RESOLUTION • UP TO 12” X 18” PAPER SIZE / BANNER PRINTS UP TO 12” X 48” • POSTER MODE
KYOCERA TA 6054ci COLOR COPIER/MFP
CASH PURCHASE $9,500 + Tax
*INCLUDED:
• SET-UP, DELIVERY, NETWORK INSTALLATION, INSTRUCTION, AND CUSTOM SURGE AND NOISE PROTECTION.
• A COMPREHENSIVE MAINTENANCE AGREEMENT INCLUDING ALL PARTS, LABOR, AND SUPPLIES, (Except Paper and Staples), IS AVAILABLE FOR $0.0085 B&W AND $0.049 COLOR PAGES. RATES FIXED FOR 60 MONTHS.
4260 N . FRESNO STREET , FRESNO , CA 93726
TER I BRYMER / 225-557 1 D IRECT
Item No. 4.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: Authorization to Repair City Well No. 7
SOURCE: Public Works
COMMENT: The City of Porterville's Well No. 7, located on the Northeast corner of Orange Avenue and South Western Street, has experienced an operational failure to the submersible motor. The demand for the water system depends on all wells being operational, making it imperative that the operation of Well No. 7 be restored. Failure to correct this issue would affect the City’s overall water system pressure and production capabilities.

In an effort to secure the services of a pump repair company, three (3) bids were requested, and three (3) bids were received from these local pump repair companies:

Company Total
S. A. Camp Pump And
Drilling Company
$9,391
Zim Industries Inc. $10,319
Carver Pump Service $10,990
S. A. Camp Pump And Drilling was the lowest quote, and can immediately start correcting all the operational issues with City Well No. 7. Funding for the total cost of repair is available in the 2023/2024 Water Operating Fund at a cost not to exceed $10,330 (inclusive of all parts, taxes, labor, and contingencies).

RECOMMENDATION: That the City Council:

1. Direct the Finance Director to initiate a Purchase Order to S. A.

Camp Pump And Drilling for an amount not to exceed $10,330 (inclusive of all parts, taxes, labor, and contingency) for the repair of City Well No. 7; and

2. Direct the Finance Director to make payment to S.A. Camp Pump And Drilling upon receipt of the invoice approved by the Public Works Director.

ATTACHMENTS: 1. City well No. 7 Map

2. S.A. Camp Pump and Drilling Company Quote

3. Zim Industries Inc. Quote

4. Carver Pump Service Quote
Item No. 4.

Appropriated/Funded:

Review By:

Department Director:

Michael Knight, Public Works Director
Final Approver: Patrice Hildreth, City Manager
CITY WELL #7

ENGINEERING DIVISION

CITY OF PORTERVILLE
291 NORTH MAIN STREET PORTERVILLE, CA. 93257
(559) 782-7462 LOCATOR MAP S JAYE ST

W ORANGE AVE

PORTERVILLE

HIGH SCHOOL

UNION AVE S WESTERN ST

Item No. 5.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: Intent to Set a Public Hearing - Vacation of a Portion of College Avenue SOURCE: Engineering and Project Management
COMMENT: The City has received a request to vacate an improved segment of College Avenue at Main Street. Attached is a locator map and legal description that illustrates the location of the public street to be vacated. Porterville College is implementing their Facilities Master Plan for the campus and as part of that plan, the circulation on College Avenue will no longer extend onto Main Street as a new road (Triunfo Avenue) is planned to connect Main Street and Plano Street south of Jamison Stadium. The roads for College Avenue and Triunfo Avenue will be constructed by Porterville College to City Standards.

Staff has reviewed the request to vacate the portion of College Avenue and believes that there are no problems with any other reversionary rights. The street vacation is necessary for the proposed orderly development of the Porterville College Facilities Master Plan.

All fees have been paid, and if the Council takes action to vacate a portion of the public street, the utility companies will be notified of the intent to vacate the portion of College Avenue. An easement will be retained for utilities that exist within the boundaries of College Avenue that is to be vacated.

RECOMMENDATION: That the City Council:

1. Approve the resolution of intent to abandon a portion of College Avenue; and

2. Set the Council meeting of March 19, 2024, as the time and place for the Public Hearing.

ATTACHMENTS: 1. Draft Resolution

2. Locator Map

3. Legal Description

4. Porterville College Facilities Master Plan Exhibit
Appropriated/Funded:

Review By:

Department Director:

Javier Sanchez, Engineering & Project Management Director Final Approver: Patrice Hildreth, City Manager
Item No. 5.

RESOLUTION NO. _____ - 2024

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PORTERVILLE

OF INTENTION TO VACATE AND CLOSE TO PUBLIC USE AN IMPROVED

SEGMENT OF COLLEGE AVENUE AT MAIN STREET
SECTION 1: The Council of the City of Porterville, California, pursuant to Division 9, Part 3, Section 830, of Streets and Highways Code of the State of California, does hereby resolve as follows, to-wit:

That it is the intention of the Council of the City of Porterville to abandon and close to public use that certain right of way located in the City of Porterville, County of Tulare, State of California, and known generally as an improved portion of College Avenue at Main Street.

SECTION 2: A map or plan of said public rights of way intended to be vacated, abandoned and closed to public use is on file in the office of the City Clerk of the City of Porterville, reference to which is hereby made.

SECTION 3: The public convenience and necessity requires the reservation of easements and rights of way for public utility facilities enumerated in Section 8334.5 of the California Streets and Highways Code;
SECTION 4: The City of Porterville, in abandonment of said public rights of way to public use, reserves and excepts from the vacation the permanent easement and right at any time, or from time to time to construct, maintain, operate, replace, remove and renew sanitary sewers, water lines, and storm drains and appurtenant structures in, upon, over, and across said street or part thereof proposed to be vacated and pursuant to any existing franchises or renewals thereof, or otherwise, to construct, maintain, operate, replace, remove, renew and enlarge lines of pipes, conduits, cables, wires, poles and other convenient structures, equipment and fixtures for the operation of gas pipe lines, telegraph and telephone lines, railroad lines, and from the transportation or distribution of electric energy, petroleum and its products, ammonia, water and incidental purposes, including the access and the right to keep the property free from flammable Resolution No. ____-2024

materials and wood growth, and otherwise protect the same from all hazards in, upon and over the street or part thereof herein proposed to be vacated.

SECTION 5: Notice is further given that on Tuesday, the 19th day of March, 2024, at 6:30 p.m., or as soon thereafter as the matter can be heard, in the Council Chambers at City Hall in the City of Porterville, at 291 North Main Street, is hereby fixed for the time and place for hearing any objections to the vacation, abandonment and closing to public use of said public rights of way
PASSED, APPROVED, AND ADOPTED this 20th day of February, 2024.

Martha A. Flores, Mayor
ATTEST:

Patrice Hildreth, City Clerk
By:

Fernando Gabriel-Moraga,
Acting Chief Deputy City Clerk
© 2024 Microsoft Corporati

AREA TO BE VACATED

ENGINEERING DIVISION

CITY OF PORTERVILLE
291 NORTH MAIN STREET PORTERVILLE, CA. 93257
(559) 782-7462 PROPOSED COLLEGE AVE

VACATION
HIGHWAY 190

S MAIN ST

E COLLEGE AVE

N
Item No. 6.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: Permanent Local Housing Allocation (PLHA) – Request for Proposals (RFP) Funding Recommendations
SOURCE: Community Development
COMMENT: As presented to the City Council at its meeting on May 19, 2020, the California Department of Housing and Community Development (HCD) announced the availability of approximately $195 million in funding for the Permanent Local Housing Allocation (PLHA) program Notice of Funding Allocation (NOFA). In order to access the funds, the City had to adopt a Five-year PLHA Plan.

Since then, the City has received the allocation for the first three (3) years of the Five (5) year plan. As noted in the December 5, 2023, staff report, which is attached for reference, a change in operators for two (2) of the awarded projects and unsubscribed funds from the year 3 RFP, resulted in a need to re-issue an RFP for funds from all three years.

At its meeting on December 5, 2023, the Council authorized staff to distribute an RFP that includes year 1, year 2 and year 3, specifically for Navigation Center/Emergency/Bridge Housing and Permanent Supportive Housing operations, to include remaining Administrations (up to 5%) for a total of $292,545.48.

On January 19, 2024, RFP 22/23-SR1957 closed, with the City receiving an application from Central California Family Crisis Center (CCFCC), Family Services of Tulare County (FSTC), and Kings View. The review committee determined that there are sufficient funds available to fund all three proposals for the requested amounts. Staff is presenting a recommendation for funding (summary included as attachment) for Council’s consideration to award PLHA funds totaling $174,048.27 to CCFCC ($54,973.53), FSTC ($12,894) and Kings View ($106,180.74) for Permanent Supportive Housing Operations, Navigation Center Operations and Emergency & Bridge Housing Operations.

Additionally, a total of $118,497.21 in funds still available for Permanent Supportive Housing program operations, which will be brought back to City Council at a later date with recommendations to be considered, following a public hearing notice.

RECOMMENDATION: That the City Council:

1. Award Central California Family Crisis Center in the Item No. 6.
amount of $34,973.53 for Permanent Supportive Housing
(PSH) Operations and $20,000 for Emergency Shelter &
Bridge Housing Operations;

2. Award Family Services of Tulare County in the amount of $12,894 for Permanent Supportive Housing Operations;
and

3. Award Kings View in the amount of $87,963.98 for
Navigation Center Operations and $18,216.76 for
Emergency Shelter & Bridge Housing Operations.

ATTACHMENTS: 1. PLHA RFP Funding Recommendations

2. Staff Report from December 5, 2023
Appropriated/Funded:

Review By:

Department Director:

Claudia Calderon, Acting Community Development Director Final Approver: Patrice Hildreth, City Manager
RFP 22/23‐SR1957 Funding Recommendations
Kings View Year Program Admin Total
Navigation Center Operations 2 $83,565.78 $4,398.20 $87,963.98 Emergency & Bridge Housing Op 2 $17,305.92 $910.84 $18,216.76 $106,180.74
Total Awards
CCFCC Year Program Admin Total
PSH Operations 1 $9,973.53 $0.00 $9,973.53
PSH Operations 2 $20,000.00 $20,000.00
PSH Operations 3 $25,000.00 $25,000.00
$54,973.53
Total Awards
FSTC Year Program Admin Total
PSH Operations 3 $12,280.00 $614.00 $12,894.00
$12,894.00
Totals $168,125.23 $5,923.04 $174,048.27
Item No. 9.

CITY COUNCIL AGENDA – DECEMBER 5, 2023
SUBJECT: Permanent Local Housing Allocation Request for Proposals (RFP) – Additional Funds to be included in RFP No. 22/23-SR1957
SOURCE: Community Development
COMMENT: As presented to the City Council at its meeting on May 19, 2020, the California Department of Housing and Community Development (HCD) announced the availability of approximately $195 million in funding for the Permanent Local Housing Allocation (PLHA) program Notice of Funding Allocation (NOFA). In order to access the funds, the Council adopted a Five-Year PLHA plan on July 21, 2020. The plan allocates PLHA funding over the five-year term, which is estimated to be approximately $2,056,524.

On February 26, 2021, the City received the executed agreement for the FiveYear PLHA plan and Year 1 funding in the amount of $342,754. An amendment to the Five-Year Plan was submitted with the Year 2 application and on December 10, 2021, the City was notified by HCD that the City's amendment to the Five-Year Plan and application for second year funding was approved. The City received $532,745 for Year 2. Funding for the first two years has been awarded via the Request for Proposals (RFP) process and programs are underway.

On February 23, 2023, the City received an executed agreement for the 2021 (third year) PLHA funding in the amount of $586,270.00, totaling $1,461,769 for the first three years. At its meeting on May 16, 2023, the Council approved to reopen the RFP for 2021 PLHA, specifically for the activity of Permanent Supportive Housing Program Operating costs. This was for $55,475.26, the unsubscribed amount from RFP No.22/23-SR1944 issued on March 24, 2023.

On June 5, 2023, as staff prepared to publish the reopening of this RFP, Turning Point of Central California (TPOCC) notified staff that they were not going to accept the award from RFP No.22/23-SR1944, as they were ceasing operations of the Porterville Navigation Center on June 30, 2023. At its meeting on July 18, 2023, Council authorized staff to publish an RFP for the Operations of the Porterville Navigation Center and to incorporate the PLHA funding that was originally awarded to the Porterville Navigation Center (RFP No. 22/23- SR1944) as a result of this change in operators.

In June 2023, TPOCC notified staff that they were expecting to have remaining 2020 PLHA (Year 2) funds at the end of the fiscal year, June 30, 2023. Staff delayed the reopening of the 2021 RFP, to bring back the item to Council to request authorization to include Year 2 funds of $100,871.70 in the RFP No.

Item No. 9.
22/23-SR1957, specifically for Navigation Center/Emergency/Bridge Housing operations and to allow for up to five percent (5% or maximum of $5,309.04) in administrative costs from the Administration allocation totaling an additional $106,180.74.

On August 29, 2023, as staff was finalizing this staff report to be presented at the September 4, 2023, Council meeting, TPOCC informed City staff that as of October 31, 2023, they would no longer be administering the Permanent Supportive Housing (PSH) 12-bed program that was partially funded with PLHA funds. It was anticipated that they would have remaining funds that would need to be included in the RFP for PSH operations for both Year 1 (2019) and Year 2 (2020) of the PLHA Five-Year plan. TPOCC's final invoice was received on November 22, 2023, reflecting a balance of $9,973.53 for Year 1 and the full awarded amount of $53,274.50 for Year 2.

This addition would increase the available funding from $55,475.26 to $281,373.73. However, it would need to remain in each specific eligible use as to not exceed the percentages outlined in the adopted PLHA Five-Year plan approved by HCD. The following chart outlines the funding available in each category of eligible uses. Remaining Administration allocations were also received, totaling $11,171.75 as outlined in the chart below.

Plan Year Available Eligible Use Remaining
Admin
Allocation
Expenditure
Deadline
Year 1 $9,973.53 Permanent
Supportive
Housing
Operations
$0 June 30, 2024
Year 2 $83,565.78 Navigation
Center
Operations
$4398.20 June 30, 2025
Year 2 $17,305.92 Emergency &
Bridge
Housing
Operations
$910.84 June 30, 2025
Year 2 $53,274.50 Permanent
Supportive
Housing
Operations
$0 June 30, 2025
Year 3 $117,254.00 Permanent
Supportive
Housing
Operations
$5,862.71 June 30, 2026
Item No. 9.

Totals $281,373.73 $11,171.75
RECOMMENDATION: That the City Council authorize staff to issue an RFP that includes Year 1, Year 2 and Year 3 PLHA funds to the RFP No. 22/23 - SR1957, specifically for Navigation
Center/Emergency/Bridge Housing and Permanent Supportive Housing operations, to include remaining Administration (up to 5%) for a total of $292,545.48.

ATTACHMENTS: 1. Draft Request for Proposals
Appropriated/Funded:

Review By:

Department Director:

Jason Ridenour, Assistant City Manager
Final Approver: John Lollis, City Manager

CITY OF PORTERVILLE

REQUEST FOR PROPOSALS FOR PERMANENT LOCAL HOUSING
ALLOCATION (PLHA) THIRD YEAR FUNDING OF 2019-2023 FIVE YEAR

PLAN - REOPENED
RFP No. 22/23 - SR1957
The City of Porterville has reopened this RFP and is seeking qualified nonprofit organizations and affordable housing developers to propose use of PLHA funds for projects that benefit individuals or families that are experiencing homelessness as described in eligible activities in this RFP.

Submittal: One PDF file must be received by:

Friday, January 19, 2024, by 5:00 pm.

Via the Public Purchase Website:
www.publicpurchase.com, or
[email protected]
Document Title: RFP No. 22/23-SR1957 Permanent Local Housing Allocation (PHLA) Third Year Funding of 2019-2023 Five Year Plan
Late proposals will not be accepted and will be automatically disqualified from further consideration.

All proposals and any accompanying documentation become the property of the City of Porterville and will not be returned.

INQUIRIES:

Proposal forms may be inspected and electronically downloaded at no cost, at the Public Purchase website, www.publicpurchase.com. No copies of said documents will be provided by the City. All addenda and correspondence during the bid process will be handled electronically through the Public Purchase website. Questions regarding this project are due no later than Wednesday, January 17, 2024.

City of Porterville RFP For Use of PLHA Funds 2 | P a g e

REQUEST FOR PROPOSALS (RFP)

FOR FIVE YEAR PLHA PLAN
I. PROPOSED PROJECT
PROJECT TITLE: PLHA Five Year Plan (2019-2023) - Year 3 Funding GRANTOR: California Department of Housing and Community Development (HCD) PROPOSAL DUE DATE: January 19, 2024
AMOUNT AVAILABLE: Third year remaining balance is $52,701.50 for single or multiple projects, with the possibility of additional funds to be available estimated at $2,056,524 for the five-year plan. Additionally, up to $281,373.73 available for year 1, year 2 and year 3 funding. Additionally, $11,171.75 is available in Administration funding remaining from unused returned funds.

Plan
Year Available Eligible Use
Remaining Admin
Allocation
Expenditure
Deadline
Year 1 $9,973.53 PSH Operations 0 June 30, 2024
Year 2 $83,565.78 Navigation Center Operations $4,398.20 June 30, 2025 $17,305.92
Emergency & Bridge Housing
Operations $910.84 June 30, 2025
$53,274.50
Permanent Supportive Housing
Operations $0.00 June 30, 2025
Year 3 $117,254.00
Permanent Supportive Housing
Operations $5,862.71 June 30, 2026
$281,373.73 $11,171.75
ADMINISTRATIVE ALLOWANCE: As noted above up to 5% of request.

TIME PERIOD FOR CONTRACT: One-year grant term for operating expenses for a permanent supportive service project, (please note that Year 1 funding must be expended by June 30, 2024) Navigation Center, Emergency or Bridge Housing shelter. Funding in 5yr Plan will be announced when received.

IMPORTANT DOCUMENTS:

Please read the following document located at: https://www.hcd.ca.gov/grants-and-funding/programsactive/permanent-local-housing-allocation • Notice of Funding Announcement: Applicants must ensure that program design meets the 2022

HCD NOFA
• Permanent Local Housing Allocation Final Guidelines
• City of Porterville Permanent Local Housing Allocation Five-Year Plan (2019-2023):
https://www.ci.porterville.ca.us/departments/community_development/community_development_ block_grant_program_(cdbg)/index.php
City of Porterville RFP For Use of PLHA Funds 3 | P a g e OBJECTIVE: In 2017, Senate Bill 2 (the Building Homes and Jobs Act) created the Permanent Local Housing Allocation (PLHA) program. The California Department of Housing and Community Development (HCD) announced the availability of approximately $195 million in funding for the PLHA program Entitlement and Non-entitlement Local government formula component Notice of Funding Availability (NOFA). This is the 3rd year NOFA funded from moneys deposited in the Building Homes and Jobs Trust Fund (Fund) in calendar year 2021, pursuant to Senate Bill (SB) 2 (Chapter 364, Statutes of 2017). SB 2 established the Fund and authorizes the Department to allocate 70 percent of moneys collected and deposited in the Fund, beginning in calendar year 2019, to Local governments for eligible housing and homelessness activities. The intent of the bill is to provide a permanent, ongoing source of funding to Local governments for housing-related projects and programs that assist in addressing the unmet housing needs of their local communities.

The City of Porterville, as an Entitlement Local government, applied and received 2021 formula allocation of PLHA funds in the amount of $586,270. The approximate PLHA five-year formula allocation amount is $2,056,524. PLHA funds must be used to carry out one or more of the eligible activities. This RFP is being reopened to provide an opportunity to Permanent Supportive Housing program operators to apply for the remaining $52,701.50 plus up to 5% admin costs that were not requested in the first RFP period. This total plus other funds that have become available from other projects that changed operator to altogether total $281,373.73 plus $11,171.75 in administration funds for Permanent supportive housing, Navigation Center, Emergency or Bridge Housing shelter operating expenses for Year 1, Year 2 and Year 3 have also been added to this RFP. Please review chart above for details on how much is available in each category.

The City of Porterville plans to use PLHA funds for three (3) priorities, distributed over three (3) possible activities that assist persons who are experiencing homelessness or at risk of homelessness. §301(a)(6) Assisting persons who are experiencing or At-risk of homelessness, including, but not limited to, providing rapid re-housing, rental assistance, supportive/case management services that allow people to obtain and retain housing, operating and capital costs for navigation centers and emergency shelters, and the new construction, rehabilitation, and preservation of permanent and transitional housing.

The eligible activities in the City’s five-year plan include:

1. Provide operating costs for navigation centers

2. Provide operating costs for emergency shelters and/or bridge housing programs.

3. Support Permanent Housing Programs:
a. Provide operating costs for permanent supportive housing programs.

II. ELIGIBLE APPLICANTS
Affordable Housing Developers and Nonprofit organizations are eligible to apply that can demonstrate institutional, managerial and financial capability to plan, manage and complete the program as described.

III. LOCAL CRITERIA
The recipient or sub-recipient must participate with local priority systems that are in place to include the following; HMIS for data collection, Coordinated Entry System (CES), and project must be financially feasible. Additionally, the activities funded must take place in the city limits of Porterville.

IV. ELIGIBLE ACTIVITY
The applicant may apply for funding for one or more of the eligible activities.

OPERATING COSTS FOR NAVIGATION CENTERS
City of Porterville RFP For Use of PLHA Funds 4 | P a g e PLHA funds can be used for operation costs associated with a new or existing Navigation Center. The Navigation Center would serve as a central location for people who are experiencing homelessness to connect to services to help them obtain housing or overcome barriers in obtaining housing.

OPERATING COSTS FOR EMERGENCY SHELTERS AND/OR BRIDGE HOUSING PROGRAMS.

PLHA funds can be used for operating costs needed to run an emergency shelter and/or operating costs for a bridge housing beds, leading to permanent housing. This will assist in ensuring that low barrier beds for people who have been identified by the local Continuum of Care on Homelessness, the Kings/Tulare Homeless Alliance (KTHA) continue to be available.

PERMANENT HOUSING PROGRAMS: OPERATING COSTS FOR PERMANENT SUPPORTIVE HOUSING

PROGRAMS (PSH)
Permanent housing is community-based housing, the purpose of which is to provide housing without a designated length of stay. PLHA funds may be used for operating costs. PSH can only provide assistance to individuals with disabilities and families in which one adult or child has a disability. Supportive services designed to meet the needs of the program participants must be made available to the program participants.

Placement or retention in housing must not be conditional upon participation in such services.

PSH Targets Chronically Homeless Individuals
To be eligible, proposed PSH projects must target chronically homeless individuals, as defined by HUD.

PSH is Low-barrier and Follows HUD Housing First Approach To be eligible, proposed PSH projects must be low-barrier and follow the HUD Housing First Approach.

V. GENERAL ELIGIBILITY CRITERIA
Applicants must meet the minimum general eligibility criteria described below:
• Activities must take place in the City limits of Porterville • Organizations must not discriminate on the basis of ethnicity, race, color, creed, religion, gender, national origin, age, disability, marital status, sexual orientation, gender identity, or Veteran’s discharge status.
• Applicants must agree to use the CoC’s CES as the sole referral source for each program component. The CES is the central access and referral point for all homeless individuals seeking housing in City of Porterville. This system will identify the most appropriate housing options while also prioritizing the most vulnerable individuals for placement into permanent housing. The system will then maintain a steady flow of referrals to all available housing options. To ensure these individuals have appropriate access to the program components, a project may need to modify its entrance criteria or use reasonable accommodation to admit tenants who would otherwise not be able to apply. By agreeing to use the coordinated entry system as the sole referral source, applicants agree to make reasonable accommodation to accept the referrals. • Applicants must agree to operate projects under the “Housing First” model, meaning prospective tenants are not required to agree to participate in services prior to entering the housing nor can service participation be a requirement of tenancy. Tenants can be required to adhere to a standard market lease, and their tenancy should be supported by eviction prevention strategies, including the engagement of services as appropriate.
• Multiple organizations may apply as a collaborative or joint venture; however, a lead entity must be designated.

City of Porterville RFP For Use of PLHA Funds 5 | P a g e • Organizations must be able to demonstrate capacity to start operations within 90 days of contract award.
• Organizations must have adequate financial capacity to perform proposed operations on a reimbursement basis
• Organizations must submit reports and invoices in a timely manner.

VI. APPLICATION SUBMISSION REQUIREMENTS

APPLICATION PROCESS
Applications from this Request for Proposals (RFP) from Qualified Agencies will be accepted beginning Saturday, December 9, 2023 through Friday, January 19, 2024. Agencies funded as a result of this RFP are expected to execute contracts with the City of Porterville by December February 29, 2024 and begin program operations no later than 60 days from contract execution.

Respondents shall submit a complete RFP application, (including all attachments), to:

All proposals must be submitted in PDF format electronically to the City of Porterville, via the Public Purchase website, www.publicpurchase.com, or via email to [email protected] and titled “RFP No. 22/23-SR1957 Permanent Local Housing Allocation (PHLA) Third Year Funding of 2019-2023 Five Year Plan - Reopened”.

The City will review and evaluate each qualification and proposal submission. The City reserves the right to obtain clarification or request additional information, including an interview. If an interview is required, they will be scheduled for January 29, 2024 to February 3, 2024. Proposals will be evaluated and ranked according to the following criteria:

Criteria Points
Understanding of the project and scope of services 40
Experience in the disciples directly relevant to the
project and scope of services
30 Proposed budget and fee structure 30
Following an evaluation of the proposals, it is expected that the selected agency(ies) will be recommended to the City Council for approval. If approved by the City Council, a subrecipient agreement will be executed between the City of Porterville and the selected agency(ies).

The City of Porterville, as a unit of local government, reserves the right to reject any and/or all proposals, reserve the right to waive any formalities or irregularities in the proposal or evaluation process, and reserve the right to award contract(s) in the best interest of the City of Porterville. In addition, the City will not reimburse costs associated with the preparation or presentation of the proposals.

APPLICATION FORMAT
The submitted proposals should contain the following components:
• Applicant Information Form (Attachment A)
• Project Narrative
o Program Description and Design
o Management of Program
City of Porterville RFP For Use of PLHA Funds 6 | P a g e o Fiscal Management
o Diversity and Multicultural Competency
• Estimated Spending Plan and Revenue Summary Form (Attachment B)

APPLICANT INFORMATION FORM
See form in Attachment A.

PROJECT NARRATIVE

1. Program Description and Design (Limit your response to 3 pages) a. Program Description
i. Provide a short, one or two sentence explanation of the purpose of this program and what the funds will be used on.
ii. Explain why the program is needed.
b. Provide a detailed description of your entire proposal as below:
i. Describe the scope of the project, including the number of households that will be served annually, the program services and financial assistance that will be offered to address housing and supportive service needs. Detail the program activities under this service model and how each one will help to achieve one or more of the eligible activities listed in the City of Porterville’s PLHA Five-Year Plan. ii. Describe annual outcomes the project expects to accomplish throughout the grant period.
iii. Describe how program services and/or other resources within your agency will be used to quickly reduce housing barriers and quickly engage participants in successfully maintaining housing stability.
iv. Describe how your project will achieve geographic dispersion and client choice in offering housing placements throughout the City of Porterville. v. Describe the project timeline for program start-up, hiring staff, and achieving fully operational status.
vi. If the applicant is partnering with another organization to provide housing and/or services to project participants, list the names of the partners and provide information on the specific roles and responsibilities of each. vii. Describe how you intend to measure program effectiveness in terms of outcomes to be achieved.
c. Participants
Describe your agency’s experience in the past two years providing services to persons who are experiencing homelessness or at risk of homelessness. i. Describe how you determined the number of clients to be served with the funding requested in this application.
ii. Describe the population(s) you intend to serve. Explain how the target population is identified, qualified and monitored. How will the project link populations to units of non-time limited housing?
d. Personnel
i. Describe the overall staffing plan to accomplish activities in the proposed program, including project leadership, reporting responsibilities, and daily program operations.
e. Collaboration/Coordination
Describe any formal or informal coordination, partnerships, or collaborations with other organizations proposed in this application.

City of Porterville RFP For Use of PLHA Funds 7 | P a g e i. Will the proposed program use subrecipients and/or subcontractors? If yes, please list each partner agency, describe their role as either a subrecipient or contractor, describe what services and the frequency of services that will be offered by the partner agency, and provide a brief description of the partner agency’s experience providing homelessness services.
ii. Describe the organization’s ability to collect data electronically and your agency’s plan to participate in HMIS and/or Coordinated Entry.

2. Fiscal Management (Limit your response to one page)
a. Please outline the organization’s initial program budget, including the availability of other revenue sources. Complete the Estimated Spending Plan and Revenue Summary Form (Attachment B). If the sections do not apply to your program type or you are not requesting funds please enter $0 or N/A. Do not leave sections blank. b. As part of the organization’s initial program budget, please identify all personnel who will provide direct or indirect support of the organization’s proposed services. Include each position title, the number of staff positions within each position title, and the number of Full Time Equivalents (FTEs) within each position title category. Identify additional fund source(s) that pays for each staff member’s salary. These positions should be the same as those listed in the Personnel section of the proposal.
c. Describe how the organization will assure the proper use and safeguarding of public funds and experience using government funds. Does your organization have policies and procedures regarding the financial operations of the organization? Have recent reviews or audits of the organization by a certified public accountant or other financial professional identified any weaknesses in the organization’s financial internal controls? If so, please provide the written report identifying the weaknesses and describe how the organization has responded to correct weaknesses.
d. Describe the organizations overall financial condition and the applicant’s ability to fund potential cost overruns or other costs not anticipated in the project budget. e. Provide copies of the last single audit and 990 filed

3. Diversity and Multicultural Competency (Limit your response to one page) Cultural Competency is defined as:
• Having a defined set of values and principles, and demonstrating behaviors, attitudes, policies and structures that enable the organization to work effectively in cross-cultural situations; and
• Having the capacity to 1.) value diversity, 2.) conduct self-assessment, 3.) manage the dynamics of difference, 4.) acquire institutional knowledge, and 5.) adapt to diversity and the cultural contexts of the communities being served; and • Incorporating the above in all aspects of policy making, administration, practice, service delivery and involving consumers and key stakeholders.
a. Explain your agency’s philosophy and the specific efforts that are in place to assure that this project will be culturally competent and linguistically accessible for the population that will be served. Be sure to include the following information in your response:
i. Based on your understanding of the target population and subpopulation(s), describe how your project will be culturally relevant, sensitive, and linguistically accessible for the individuals or households that will be served, including efforts related to staffing, outreach and service design (i.e., how the project will help reduce barriers to housing and services for individuals of color and those households for whom English is not the primary language); ii. Describe how the ethno-cultural backgrounds of your project staff and agency board reflect that of the identified population to be served and/or how your agency City of Porterville RFP For Use of PLHA Funds 8 | P a g e is working to broaden staff and board diversity and knowledge around cultural competency; and
iii. Describe any means or efforts that are in place to assess the cultural competency of your organization and make changes accordingly.

ESTIMATED SPENDING PLAN AND REVENUE SUMMARY FORM
See Attachment B.

VII. RESPONSIVENESS
All proposals will be reviewed to determine compliance with administrative requirements and instructions specified in this RFP. The Applicant is specifically notified that failure to comply with any part of the RFP may result in rejection of the proposal as non-responsive. The City of Porterville also reserves the right at its sole discretion to waive minor administrative irregularities.

City of Porterville RFP For Use of PLHA Funds 9 | P a g e

ATTACHMENTS
A – Applicant Information Form

1. Project title:

2. Project location:

3. Number of households served on a given day: Number of households served annually:

4. Number of individuals served on a given day: Number of Individuals served annually:

5. a. This project is specifically designed to serve the following population:
(Please be very specific and check only those that apply) □ Homeless single adults
□ Homeless families with children
□ Homeless young adults (ages 18 - 25)

5. b. This project is specifically designed to serve the following subpopulation:
(Please check all that apply)
□ Homeless households living on the streets
□ Homeless households living in shelters
□ Homeless households living in transitional housing
□ Persons who are chronically homeless
□ Persons with serious mental illness
□ Persons with significant drug/alcohol addictions
□ Persons with chronic medical condition(s)
□ Persons exiting the foster care system
□ Persons exiting criminal justice facilities
□ Persons exiting mental health or psychiatric inpatient facilities □ Persons exiting residential chemical dependency treatment facilities

6. DUNS Number:

7. Federal Tax ID Number:

8. Contact Information for Project Applicant:

Lead Applicant Agency:
__________________________________________________________________________ Agency Mailing
Address:_________________________________________________________________________ City of Porterville RFP For Use of PLHA Funds 10 | P a g e Total Annual Agency Operating Budget (for all activities of the applicant agency from all sources):
______________
Executive Director Program Manager HMIS Data
Manager
Finance/Bookkeeper
Name
Title
Address (if
different mailing
then above)

Phone
FAX
Email

9. Applicant Type
Nonprofit organization
Affordable Housing Developer

10. Provide the caption, cause number, Court, Counsel, and general summary of any litigation pending or judgment rendered within the past three (3) years against the applicant, as applicable.

11. Indicate the extent, if any, to which the firm, association or corporation or any person in a controlling capacity or any position involving the administration of federal, state or local funds; is currently under suspension, debarment, voluntary exclusion, or determination of eligibility by any agency; has been suspended, debarred, voluntarily excluded or determined ineligible by any agency within the past three (3) years; does have a proposed debarment pending; has been indicted, convicted or has a civil judgment rendered against said person, firm, association or corporation by a court of competent jurisdiction in any matter involving fraud or misconduct with the past three (3) years.

City of Porterville RFP For Use of PLHA Funds 11 | P a g e Item No. 7.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: Consideration of Updated Statement of Investment Policy SOURCE: Finance
COMMENT: The City of Porterville's Statement of Investment Policy was last considered and approved by the City Council in July 2006. Staff has recently reviewed the investment policy and are proposing an updated version to clarify and strengthen the requirements for investing, safekeeping, and reporting of the City's investment portfolio. The revisions include additions to the list of authorized and acceptable investments. The updated policy continues to meet the statutory requirements governing the investment of public funds.

On January 24, 2024, the City's Audit Committee met to review the updated Statement of Investment Policy and recommended approval of the same.

RECOMMENDATION: That the City Council adopt the resolution approving the updated Statement of Investment Policy.

ATTACHMENTS: 1. Investment Policy 2006

2. Redline - Draft Updated Investment Policy

3. Draft Updated Investment Policy

4. Draft Resolution
Appropriated/Funded:

Review By:

Department Director:

Janie Rodriguez, Finance Director
Final Approver: Patrice Hildreth, City Manager
Attachment “A”
1 CITY OF PORTERVILLE
Statement of Investment Policy

INTRODUCTION
The City of Porterville has a fiduciary responsibility to maximize the productive use of its liquid assets entrusted to its care and to manage those public funds wisely and prudently. The purpose of this document is to identify various policies and procedures that enhance opportunities for a prudent and systematic investment policy and to organize and formalize investment-related activities. Related activities, which comprise good cash management, include accurate cash projections, the expeditious collection of revenue, the control of disbursements, cost-effective banking relations, and short-term borrowing programs which coordinate working capital requirements and investment opportunity. In concert with these requirements are the many facets of an appropriate and secure short-term investment program.

SCOPE
It is intended that this investment policy cover all funds and investment activities under the direct authority of the City of Porterville organization. This policy does not cover any funds held by the fiscal agent in connection with the issuance of any bonds by the City. Such funds shall be invested in accordance with the applicable trust indenture.

PHILOSOPHY
The basic premise underlying Porterville’s investment philosophy is to insure that money is always available when needed. An amount of not less than one month’s payables and one month’s payroll, about $2.5 million, is maintained in immediately available investments, such as the State Treasurer’s Local Agency Investment Fund or other cash equivalents. This may include commercial paper or banker’s acceptances.

Porterville takes an active investment posture in an attempt to earn a higher yield. This investment posture is best demonstrated by the City’s long-term investments. By taking advantage of the positive yield curve (i.e., longer term rates are higher than shorter maturities), in the long run, the City should average a higher yield.

The City’s investments will be limited to an average life of three years or less. When the market warrants purchase of longer maturities to capture a higher rate of return, purchases will be limited to United States Treasury Notes and Bonds and Mortgage Backed Securities. No investment will be made in securities that have a final maturity over five years.

The economy and various markets are monitored carefully to assess the probable course of interest rates. In a market with increasing interest rates, the City will attempt to invest in securities with shorter maturities. This makes funds available for other investments when the interest rates are higher. When interest rates appear to be near a relatively high rate, the City will attempt to purchase investments with medium to long-term maturities to lock in the higher rate of return.

When interest rates are falling, the City will invest in securities with longer maturities to hold the higher rate for a longer period of time.

The City will also take advantage of any new vehicle that becomes eligible for municipal investment only after a detailed study of the investment, its safety, liquidity, and yield.

Attachment “A”
2 PRUDENCE
The City adheres to the guidance provided by the “prudent person standard,” as set forth in Government Code section 53600.3, which specifically addresses public investing, as follows:
“Except as provided in subdivision (a) of Section 27000.3, 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 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. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired by law.”
The primary objective is to safeguard the principal of the funds under the City’s control. The secondary objective is to meet the liquidity needs of the City. The third objective is to achieve a return on the funds. Porterville strives to maintain the level of investment of all funds as near 100% as possible through daily and projected cash flow determinations. Investments are made so maturities match or precede the cash needs of the City. The City will maintain adequate cash availability and maximum yield on invested funds while insuring that principal invested is protected from loss.

INVESTMENT CRITERIA
Criteria for selecting investments are:

1. Safety;

2. Liquidity; and

3. Yield.

Porterville attempts to obtain the highest yield available when selecting investments, provided that criteria for safety and liquidity are met. Because ordinarily yield curves are positively sloped, (i.e., longer term rates are higher than shorter maturities), the City attempts to ladder its maturities.

This meets anticipated cash needs in such a way that new investment money can be placed in maturities that carry a higher rate than is available in the extremely short market of 90 days or under.

Government and agency paper are the highest quality investments available in terms of safety and liquidity. Certificates of deposit, savings accounts, and bankers acceptances are insured or collateralized. Only direct-issue commercial paper, with A-1 Moody’s and Standard and Poor’s ratings, will be purchased. These quality-rating criteria shall apply at the time of investment.

Should a particular issuer fall below these standards (“be downgraded”) while the investment is in the City’s portfolio, the prudent investor rule shall apply. Negotiable Certificates of Deposit are not insured or collateralized.

Most investments are highly liquid, with the exception of collateralized certificates of deposit held by banks, savings and loans, and Small Business Administration notes. Maturities are selected to anticipate cash needs, thereby avoiding the need for forced liquidation.

Attachment “A”
3 STATE AND CHARTER REGULATIONS
The City operates its investment pool with many State and self-imposed constraints. In accordance with SB 564 and SB 866, effective January 1, 1996, the City Treasurer will bring this Policy before City Council annually for its reaffirmation. Government Code Section 53601 restricts the City portfolio mix to:

1. 30% in Medium Term Notes;

2. 30% in Negotiable Certificates of Deposit;

3. 40% in Bankers Acceptance Notes, not to exceed 180 days in maturity; and

4. 25% in Commercial Paper, not to exceed 270 days in maturity.

These restrictions primarily apply to short-term investments and are interpreted to apply at the time of investment. If, as the portfolio mix changes over time, a particular segment exceeds these restrictions, the prudent investor rule shall apply. The City does not buy stocks and it does not speculate.

The City will be selective in purchasing long-term negotiable certificates of deposit and medium term notes, placing such an investment only with a large stable institution.

MATURITY OF INVESTMENTS
The City of Porterville will operate a portfolio with an average life of three years or less. This is to insure liquidity and the ability to move with changing markets and interest rate movements.

Accordingly, no investment will be made in securities that have a final maturity over five years.

The long-term securities shall only be Treasury Notes and Bonds and Mortgage Backed Securities.

SECURITIES DEALERS AND BROKERS
The City of Porterville will undertake a yearly review of its broker/dealer relationships. The City will deal generally with the major broker/dealer firms or major banks in the country and then with only their institutional investment divisions. Primary government securities dealers are preferred for conducting transactions of all eligible securities. Primary dealers must report daily to the Federal Reserve, are very tightly regulated, and must keep specified levels of working capital.

Secondary dealers are those dealers who buy and sell securities in the open market. Secondary and other security dealers who wish to engage in transactions with the City must meet the City’s requirements for reliability and safety and be approved prior to purchase. These relationships are formalized through a corporate statement. The City will deal with both after meeting the City’s requirements.

The City shall also be open to contracting investment management services for a portion of the portfolio. That portion shall be limited to longer-term investments of two years or longer. Any investment management firm contracted shall meet criteria established by the Finance Department. All investments made under contract will be purchased in the City’s name and in accordance with the guidelines established by the City’s investment policy.

PERIODIC REPORTING
Also in accordance with SB 564 and SB 866, each quarter, the City Treasurer will issue a report of the City’s current investment portfolio, detailing securities, purchase and maturity date, and Attachment “A”
4 face and market value. This report will also confirm that current portfolio holdings are in compliance with this policy and that the City’s cash needs will be met.

Each quarter some of the long-term investments will be reviewed in order to determine if it is advantageous to sell those securities and purchase others. The review will consider current market conditions and various spread relationships among security types. The monitoring of the conditions set forth in this policy statement is the responsibility of the City Treasurer or delegate.

TYPES OF INVESTMENTS
Cash management and investment transactions are the responsibility of the City Treasurer or delegated investment officer. The following City of Porterville employees are defined as authorized investment officers:

John Longley, City Manager
John Lollis, Administrative Services Manager
Maria Bemis, Acting Chief Financial Officer
Investments are made in the following:

1. Securities of the U.S. Government

Securities of the Government include U.S. Treasury bills, notes and bonds.

U. S. Treasury Bills - are issued by the U.S. Treasury and are available in maturities out to one year. They are non-interest bearing and sold on a discount basis. The face amount is paid at maturity.

Treasury Notes - are issued by the U.S. Treasury with maturities from two to ten years.

They are issued in coupon form and many issues are also available in registered form.

Interest is payable at six month intervals until maturity.

Treasury Bonds - are issued by the U.S. Treasury with maturities of ten years to thirty years. The City may purchase the interest and/or principal of a U.S. Treasury Bond. A principal only instrument is commonly called a “stripped” or “zero” coupon. Stripped coupons are sold at discount basis. The face amount is paid at maturity.

2. Securities of U.S. Government Agencies
The United States Treasury initially financed the capital of U.S. Government agencies.

But as they have grown and operated profitably over the years, the Treasury’s investment has been replaced in large measure by private capital. At the present time, obligations of only a few agencies are backed by the full faith and credit of the U.S.

Government. The obligations of all the federal agencies described in the following sections are not guaranteed by the U.S. Government with the exception of Government National Mortgage Association, but are considered to be investments of the highest quality.

Federal National Mortgage Association (Fannie Mae) is a quasi-public corporation created by an act of Congress to assist the home mortgage market by purchasing mortgages insured by the Federal Housing Administration and the Farmers Home Administration, as well as those guaranteed by the Veterans Administration. FNMA issues Notes and Bonds. Notes are issued with maturities of less than one year with interest paid at maturity. Bonds are issued for 15 and 30 year maturities with interest Attachment “A”
5 paid semi-annually. Interest is computed on a 30/360-day basis. There is a strong secondary market in these securities. A secondary market means these instruments are actively traded, they are bought and sold daily.

Government National Mortgage Association (Ginnie Mae) is a wholly owned corporate instrumentality of the United States within the Department of Housing and Urban Development. A certificate collateralized by FHA/VA residential mortgages represents a share in a pool of FHA or VA mortgages. Ginnie Maes are registered securities.

Principal and interest are paid monthly and sent directly from the issuer of the pool, usually a mortgage banker, to the City. Original maturities range from 12 to 30 years with a 7 to 12-year assumed average life (Assumed average life is due to prepayments of mortgages).

Federal Home Loan Banks provide credit to member lending institutions such as savings and loan associations, cooperative banks, insurance companies and savings banks. The agency offers bonds in the public market with maturities of one year to ten years. These bonds are usually offered on a quarterly basis depending on the current demands of the housing industry. Interest is paid semi-annually on a 30/360 day basis.

Federal Farm Credit Banks are debt instruments issued to meet the financial needs of farmers and the national agricultural industry. Discount notes are issued monthly with 6 and 9-month maturities. Discount notes pay interest at maturity. Longer-term debentures (2-5 years) are also issued. Debentures pay interest semi-annually on a 30/360-day basis. These issues enjoy an established secondary market.

Small Business Administration Loans (SBA). The Small Business Administration is an independent agency of the United States government that furnishes financial and management assistance to small businesses. The SBA guarantees the principal portion of the loans it approves. Porterville purchases the guaranteed portion of these loans.

Maturity can be for 1 year to 30 years. These loans can be either set at a fixed rate or variable rate that is usually tied to the prime rate. Principal and interest are paid monthly on a 30/360-day basis.

Federal Home Loan Mortgage Corporation (Freddie Macs) participation certificates are backed by 30-year conventional residential mortgages and are 100 percent guaranteed by the Federal Home Loan Mortgage Corporation. The Federal Home Loan Mortgage Corporation is wholly owned by the Federal Home Loan Banks. The Mortgage Corporation is a corporate instrumentality of the United States. Freddie Macs are registered securities. Principal and interest passed through the Mortgage Corporation and then to the City monthly. These instruments have an assumed life of approximately 12 years and pay on a 30/360-day basis.

Other U.S. government securities available to the City for investment purposes include:

Student Loan Marketing Association (SLMA or Sallie Mae), Aid for International Development (AID), and debentures of Tennessee Valley Authority (TVA). However, these instruments are not offered on a regular basis and do not offer the same liquidity as the before mentioned instruments.

3. Time Deposits or Certificates of Deposit
Time deposits are placed with commercial banks and savings and loan agencies. A time deposit is a receipt for funds deposited in a financial institution for a specified period of time at a specified rate of interest. Generally, the time is 3 months to 5 years.

Denominations can be any agreed upon amount and interest is normally calculated using Attachment “A”
6 actual number of days on a 360-day year and paid monthly. Deposits of $100,000 (commonly referred to as Jumbo C.D.’s) per institution are insured by the government and collateralized Certificates of Deposit can be supported by either 110% Government agency notes or 150% mortgages currently held by the bank or savings and loan. An institution must meet the following criteria to be considered by the City:

1. The institution must maintain a net worth to asset ratio of at least 3% and a positive earnings record;

2. The institution must be in compliance with the Financial Institution Reform Act (FIRREA) capital ratio requirements for risk-based, tangible, and core capital; and

3. The institution must make available a current FDIC call reports (banks) or FHLB report. A call report presents the financial condition of the institution to the agency with oversight responsibility of that institution.

4. Negotiable Certificates of Deposit
Negotiable Certificates of Deposit are a form of Certificate of Deposit that have been an important money market instrument since 1961 when commercial banks began issuing them and a secondary market developed to provide liquidity. Since these certificates of deposit can be traded in the secondary market, they are negotiable instruments, hence their name negotiable certificate of deposit. They are supported only by the strength of the institution from which they are purchased. This is a riskier investment that provides a higher yield than regular certificates of deposit. Some issues have quarterly floating rates that mean they will more closely approximate the market in yield. Interest is paid semiannually (quarterly on the floaters) computed on a 30/360-day basis. Maturities range from 3 months to 2 years. Negotiable Certificates of Deposit are generally issued in blocks of $1 million, $5 million, $10 million and so on.

The City will restrict its investments in Negotiable Certificates of Deposit to the 100 largest United States banks and 100 largest international banks according to asset size. The profitability of the financial institution as well as its financial stability is also taken into account prior to placing the investment. As a general rule, the City will not place more than 15% of its portfolio in Negotiable Certificates of Deposit with one institution or 20% of its portfolio with any one Commercial Bank or savings and loan association in any form of Certificate of Deposit.

5. Bankers Acceptance Notes
A banker’s acceptance (B.A.) is a unique credit instrument used to finance both domestic and international transactions. As a money market instrument, it is an attractive shortterm investment. When a bank “accepts” such a time draft, it becomes, in effect, a predated certified check payable to the bearer at some future, specified date. Little risk is involved because the commercial bank assumes primary liability once the draft is accepted. Banker’s acceptances are frequently in odd amounts. Maturities normally range from 30 up to 180 days. Banker’s acceptances are sold at a discount. This means, the face amount is received at maturity. The City will purchase B.A.’s only of the top 100 U.S. or Foreign Banks. The profitability of the financial institution as well as its financial stability is also taken into account prior to placing the investment.

6. Commercial Paper
Attachment “A”
7 Commercial paper is the trade name applied to unsecured promissory notes issued by finance and industrial companies to raise funds on a short-term basis. Commercial paper can be purchased on an interest bearing or discount basis. Interest bearing instruments pay interest semi-annually. Discounted instruments pay interest at maturity. The City will invest in commercial paper only if the yields are attractive, and if the paper is rated A-1 by Moody’s and by Standard & Poor’s rating services. Maturities range from 30 to 180 days with interest computed on a 30/360-day basis.

7. Medium Term Notes
In recent years, this financing mechanism has grown, providing capital to the private sector, and diminishing the Negotiable Certificate of Deposit market. The trend towards medium term notes related to buyer and seller flexibility and convenience. The notes are issued on any given date and maturing on a negotiated date. They generally range from 2 to 5 years in maturity. This market provides an excellent alternative to Negotiable C.D.’s.

The City will only purchase Medium Term Notes with ratings of A or better with maturities of 5 years or less. Their interest is calculated on a 30/360-day basis like Agency bonds.

Interest is paid semi-annually.

8. Local Agency Investment Fund demand deposit
The Local Agency Investment Fund (LAIF) was established by the state to enable treasurers to place funds in a pool for investments. The LAIF has been particularly beneficial to those jurisdictions with small portfolios. Each agency is limited to an investment of $15.0 million. Porterville uses this fund for short-term liquidity, investment, and yield when rates are declining. Funds are available on demand. At present, two accounts have been opened; one for the City and one for Porterville Redevelopment Agency. Interest is paid quarterly.

9. Central San Joaquin Valley Risk Management Authority (CSJVRMA) investment pool As a member city of the CSJVRMA, the City accepted the opportunity in July 2001 to participate in its sponsored investment pool. The pool is managed by Chandler Asset Management and invests in agency instruments such as Federal Home Loan Bank, treasuries and high-grade corporate stock. Funds are available on demand, with interest paid quarterly.

10. County of Tulare investment pool
Porterville participates in the County of Tulare’s investment pool that is managed by the County Treasurer, O. Gerald Fields. The County invests in the same type of Stateapproved instruments, as does the City. Funds are available on demand, and interest is paid quarterly.

Attachment “A”
1 CITY OF PORTERVILLE
Statement of Investment Policy

INTRODUCTION
The City of Porterville has a fiduciary responsibility to maximize the productive use of its liquid assets entrusted to its care and to manage those public funds wisely and prudently. The purpose of this document is to identify various policies and procedures that enhance opportunities for a prudent and systematic investment policy and to organize and formalize investment-related activities. Related activities, which comprise good cash management, include accurate cash projections, the expeditious collection of revenue, the control of disbursements, cost-effective banking relations, and short-term borrowing programs which coordinate working capital requirements and investment opportunity. In concert with these requirements are the many facets of an appropriate and secure short-term investment program.

SCOPE
It is intended that this investment policy cover all funds and investment activities under the direct authority of the City of Porterville organization. This policy does not cover any funds held by the fiscal agent in connection with the issuance of any bonds by the City. Such funds shall be invested in accordance with the applicable trust indenture.

PHILOSOPHY
The basic premise underlying Porterville’s investment philosophy is to insure ensure that money is always available when needed. An amount of not less than one month’s payables and one month’s payroll, about $2.5 million, A minimum amount of 6 percent of the adopted operating budget for all funds is maintained in immediately available investments, such as the State Treasurer’s Local Agency Investment Fund or other cash equivalents. This may include commercial paper or banker’s acceptances.

Porterville takes an active investment posture in an attempt to earn a higher yield. This investment posture is best demonstrated by the City’s long-term investments. By taking advantage of the positive yield curve (i.e., longer term rates are higher than shorter maturities), in the long run, the City should average a higher yield.

The City’s investments will be limited to an average life of three years or less. When the market warrants purchase of longer maturities to capture a higher rate of return, purchases will be limited to United States Treasury Notes and Bonds and Mortgage Backed Securities, Federal Agencies Notes and Bonds, Medium Term Notes, Time Deposits or Certificates of Deposit, and Negotiable Certificate of Deposit. No investment will be made in securities that have a final maturity over five years.

The economy and various markets are monitored carefully to assess the probable course of interest rates. In a market with increasing interest rates, the City will attempt to invest in securities with shorter maturities. This makes funds available for other investments when the interest rates are higher. When interest rates appear to be near a relatively high rate, the City will attempt to purchase investments with medium to long-term maturities to lock in the higher rate of return.

When interest rates are falling, the City will invest in securities with longer maturities to hold the higher rate for a longer period of time.

Attachment “A”
2 The City will also take advantage of any new vehicle that becomes eligible for municipal investment only after a detailed study of the investment, its safety, liquidity, and yield.

INVESTMENT OBJECTIVES
As per California Government Code Section 53600.5, the primary objectives, in priority order of the City of Porterville’s investment activities shall be:

1. Safety: Safety of principal is the foremost objective of the investment program.

Investments of the City shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio with the objective of mitigating credit risk and interest rate or market risk.

Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Investments will be limited to the types of securities authorized in this policy. The City will diversify its investment portfolio in order to minimize the impact of potential losses from any one type of security or from any one individual issuer.

Interest rate or market risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The investment portfolio will be structured so that securities mature to meet cash requirements for ongoing operations, thereby avoiding the need to sell securities prior to maturity. Securities shall generally be held until maturity.

2. Liquidity: The City’s investment portfolio will remain sufficiently liquid to enable the City to meet all payment requirements, including but not limited to payroll, accounts payable, capital projects, debt service, and other payments which might be reasonably anticipated.

3. Yield: The City’s investment portfolio shall be designed and managed with the objective of maximizing return throughout budgetary and economic cycles, commensurate with the City’s investment risk constraints and the cash flow characteristics of the portfolio.

The Treasurer/Finance Director and staff will avoid any transactions that might impair public confidence in the City.

PRUDENCE PRUDENT INVESTOR STANDARD
The City adheres to the guidance provided by the “prudent person standard,” as set forth in Government Code section 53600.3, which specifically addresses public investing, as follows:. “Except as provided in subdivision (a) of Section 27000.3, 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 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. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired Attachment “A”
3 by law.”
The primary objective is to safeguard the principal of the funds under the City’s control. The secondary objective is to meet the liquidity needs of the City. The third objective is to achieve a return on the funds. Porterville strives to maintain the level of investment of all funds as near 100% as possible through daily and projected cash flow determinations. Investments are made so maturities match or precede the cash needs of the City. The City will maintain adequate cash availability and maximum yield on invested funds while insuring that principal invested is protected from loss.

The ” prudent person standard” shall be applied in the context of managing an overall portfolio.

Investments shall be made with judgement and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs; not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. Investment officers 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 the deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments.

INVESTMENT CRITERIA
Criteria for selecting investments are:

1. Safety;

2. Liquidity; and

3. Yield.

Porterville attempts to obtain the highest yield available when selecting investments, provided that criteria for safety and liquidity are met. Because ordinarily yield curves are positively sloped, (i.e., longer term rates are higher than shorter maturities), the City attempts to ladder its maturities.

This meets anticipated cash needs in such a way that new investment money can be placed in maturities that carry a higher rate than is available in the extremely short market of 90 days or under.

Government and agency paper are the highest quality investments available in terms of safety and liquidity. Certificates of deposit, savings accounts, and bankers acceptances are insured or collateralized. Only direct-issue commercial paper, with A-1 Moody’s and Standard and Poor’s ratings, will be purchased. These quality-rating criteria shall apply at the time of investment.

Should a particular issuer fall below these standards (“be downgraded”) while the investment is in the City’s portfolio, the prudent investor rule shall apply. Negotiable Certificates of Deposit are not insured or collateralized.

Most investments are highly liquid, with the exception of collateralized certificates of deposit held by banks, savings and loans, and Small Business Administration notes. Maturities are selected to anticipate cash needs, thereby avoiding the need for forced liquidation.

ETHICS AND CONFLICTS OF INTEREST
Investment officers shall disclose material interests in financial institutions with which they do business, disclose personal financial interests that could be related to the performance of the investment portfolio and refrain from undertaking personal investment transactions with the same individual with whom business is conducted on behalf of the City.

Attachment “A”
4 DELEGATION OF AUTHORITY
The City Council hereby delegates responsibility for the management of the investment program to the City Treasurer/Finance Director, who shall establish procedures for the operation of the investment program consistent with this investment policy. Under the provision of California Government Code 53603.3, the Treasurer/Finance Director is a trustee and a fiduciary subject to the prudent investor standard. The Treasurer/Finance Director will review the investment holdings monthly and ensure that they are in compliance with the City investment policy.

The Treasurer/Finance Director may delegate all or a portion of his/her investment authority. Prior to delegation, the Treasurer/Finance Director shall notify the City Council and request confirmation of the delegation. Delegation of investment authority will not remove or abridge the Treasurer/Finance Director’s investment responsibility.

SAFEKEEPING AND CUSTODY
Securities owned by the City shall be held in safekeeping by third-party custodians acting as agent for the City and shall be evidenced by safekeeping receipts. The purchase of securities shall be conducted on a standard delivery versus payment (DVP) basis that guarantees the transfer of securities only after payment is made. The DVP system eliminates principal risk, decreasing the probability of not meeting delivery and/or payment obligations and reducing the possibility of liquidity risk. The third-party custodians are required to provide monthly statements illustrating the balance of securities held by those custodians.

Investments in investment pools and some certificates of deposit are not subject to delivery or third-party safekeeping requirements.

INTERNAL CONTROLS
The Treasurer/Finance Director is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft or misuse.

The internal controls shall include separation of duties, safekeeping of securities and written confirmation of phone transactions and wire transfers.

STATE AND CHARTER REGULATIONS
The City operates its investment pool with many State and self-imposed constraints. In accordance with SB 564 and SB 866, effective January 1, 1996, the City Treasurer will bring this Policy before City Council annually for its reaffirmation. Government Code Section 53601 restricts the City portfolio mix to:

1. 30% in Medium Term Notes;

2. 30% in Negotiable Certificates of Deposit;

3. 40% in Bankers Acceptance Notes, not to exceed 180 days in maturity; and

4. 25% in Commercial Paper, not to exceed 270 days in maturity.

These restrictions primarily apply to short-term investments and are interpreted to apply at the time of investment. If, as the portfolio mix changes over time, a particular segment exceeds these restrictions, the prudent investor rule shall apply. The City does not buy stocks and it does not speculate.

The City will be selective in purchasing long-term negotiable certificates of deposit and medium term notes, placing such an investment only with a large stable institution.

Attachment “A”
5 MATURITY OF INVESTMENTS
The City of Porterville will operate a portfolio with an average life of three years or less. This is to insure liquidity and the ability to move with changing markets and interest rate movements.

Accordingly, no investment will be made in securities that have a final maturity over five years.

The long-term securities shall only be Treasury Notes and Bonds and Mortgage Backed Securities.

SECURITIES DEALERS AND BROKERS AUTHORIZED FINANCIAL DEALERS AND

INSTITUTIONS
The City of Porterville will undertake a yearly review of its broker/dealer relationships. The City will deal generally with the major broker/dealer firms or major banks in the country and then with only their institutional investment divisions. Primary government securities dealers are preferred for conducting transactions of all eligible securities. Primary dealers must report daily to the Federal Reserve, are very tightly regulated, and must keep specified levels of working capital.

Secondary dealers are those dealers who buy and sell securities in the open market. Secondary and other security dealers who wish to engage in transactions with the City must meet the City’s requirements for reliability and safety and be approved prior to purchase. These relationships are formalized through a corporate statement. The City will deal with both after meeting the City’s requirements.

The City shall also be open to contracting investment management services for a portion of the portfolio. That portion shall be limited to longer-term investments of two years or longer. Any investment management firm contracted shall meet criteria established by the Finance Department. All investments made under contract will be purchased in the City’s name and in accordance with the guidelines established by the City’s investment policy.

The City of Porterville will maintain a list of banks, savings and loans, credit unions, and securities dealers authorized to provide investment services. Approved broker/dealers and financial institutions should meet all requirements established by federal and state law. Criteria to be considered in the selection will include creditworthiness, expertise and the types of securities.

Qualifying financial dealers and institutions must provide the City with audited financial statements, proof of National Association of Securities Dealers (NASD) certification, and a certification of having read, understood and agreeing to comply with this investment policy.

PERIODIC REPORTING
Also in accordance with SB 564 and SB 866, each quarter, On a quarterly basis, the City Treasurer/Finance Director will issue a report of the City’s current investment portfolio, detailing securities, purchase and maturity date, and face and market value, weighted average rate of earnings, weighted average days to maturity, and the percentage of liquid holdings. This report will also confirm that current portfolio holdings are in compliance with this policy and that the City’s cash needs will be met.

Each quarter some of the long-term investments will be reviewed in order to determine if it is advantageous to sell those securities and purchase others. The review will consider current market conditions and various spread relationships among security types. The monitoring of the conditions set forth in this policy statement is the responsibility of the City Treasurer/Finance Director or delegate.

TYPES OF INVESTMENTS AUTHORIZED INVESTMENTS
Cash management and investment transactions are the responsibility of the City Treasurer or Attachment “A”
6 delegated investment officer. The following City of Porterville employees are defined as authorized investment officers:

John Longley, City Manager
John Lollis, Administrative Services Manager
Maria Bemis, Acting Chief Financial Officer
Investments are made in accordance with California State Code and include the following:

1. Securities of the U.S. Government
Securities of the Government include U.S. Treasury bills, notes and bonds.

U. S. Treasury Bills - are issued by the U.S. Treasury and are available in maturities out to one year. They are non-interest bearing and sold on a discount basis. The face amount is paid at maturity.

Treasury Notes - are issued by the U.S. Treasury with maturities from two to ten years.

They are issued in coupon form and many issues are also available in registered form.

Interest is payable at six-month intervals until maturity.

Treasury Bonds - are issued by the U.S. Treasury with maturities of ten years to thirty years. The City may purchase the interest and/or principal of a U.S. Treasury Bond. A principal only instrument is commonly called a “stripped” or “zero” coupon. Stripped coupons are sold at discount basis. The face amount is paid at maturity.

2. Securities of U.S. Government Agencies
The United States Treasury initially financed the capital of U.S. Government agencies.

But as they have grown and operated profitably over the years, the Treasury’s investment has been replaced in large measure by private capital. At the present time, obligations of only a few agencies are backed by the full faith and credit of the U.S.

Government. The obligations of all the federal agencies described in the following sections are not guaranteed by the U.S. Government with the exception of Government National Mortgage Association, but are considered to be investments of the highest quality.

Federal National Mortgage Association (Fannie Mae) is a quasi-public corporation created by an act of Congress to assist the home mortgage market by purchasing mortgages insured by the Federal Housing Administration and the Farmers Home Administration, as well as those guaranteed by the Veterans Administration. FNMA issues Notes and Bonds.

Notes are issued with maturities of less than one year with interest paid at maturity. Bonds are issued for 15 and 30 year maturities with interest paid semi-annually. Interest is computed publicly traded government-sponsored enterprise created to provide liquidity, stability and affordability to the mortgage market by purchasing mortgages from banks, savings and loans and mortgage companies. Fannie Mae issues both short-term debt with maturities of a year or less and long-term debt with maturities of over a year and can either be callable or noncallable with interest payments paid semi-annually on a 30/360- day basis. There is a strong secondary market in these securities. A secondary market means these instruments are actively traded, they are bought and sold daily.

Government National Mortgage Association (Ginnie Mae) is a wholly owned corporate instrumentality of the United States within the Department of Housing and Urban Attachment “A”
7 Development. A certificate collateralized by FHA/VA residential mortgages represents a share in a pool of FHA or VA mortgages. Ginnie Maes are registered securities.

Principal and interest are paid monthly and sent directly from the issuer of the pool, usually a mortgage banker, to the City. Original maturities range from 12 to 30 years with a 7 to 12-year assumed average life (Assumed average life is due to prepayments of mortgages).

Federal Home Loan Banks provide credit to member lending institutions such as savings and loan associations, cooperative banks, insurance companies and savings banks. The agency offers bonds in the public market with maturities of one year to ten years. These bonds are usually offered on a quarterly basis depending on the current demands of the housing industry. are cooperatively owned by member financial institutions and provide a steady supply of lendable funds to financial institutions such as community banks, credit unions, commercial and savings banks, insurance companies, and community development financial institutions. They provide liquidity to their members to support housing finance and community development through all economic cycles. The agency offers bonds in the public market with majority of issues between one and five years.

Interest is paid semi-annually on a 30/360 day basis.

Federal Farm Credit Banks (FFCB) Agency bonds are debt instruments issued to meet the financial needs of farmers and the national agricultural industry. Discount notes are issued monthly with 6 and 9-month maturities. Discount notes pay interest at maturity.

Longer-term debentures (2-5 years) are also issued. Debentures pay interest support rural communities and agriculture with reliable, consistent credit and financially related services. Fixed rate bonds which maybe callable or non-callable are regularly issued with typical maturities of one to five years. Designated bonds are non-callable securities with typical maturities of two to ten years. Interest payments are made semi-annually on a 30/360-day basis. These issues enjoy an established secondary market.

Small Business Administration Loans (SBA). The Small Business Administration is an independent agency of the United States government that furnishes financial and management assistance to small businesses. The SBA guarantees the principal portion of the loans it approves. Porterville purchases the guaranteed portion of these loans.

Maturity can be for 1 year to 30 years. These loans can be either set at a fixed rate or variable rate that is usually tied to the prime rate. Principal and interest are paid monthly on a 30/360-day basis.

Federal Home Loan Mortgage Corporation (Freddie Macs) participation certificates are backed by 30-year conventional residential mortgages and are 100 percent guaranteed by the Federal Home Loan Mortgage Corporation. The Federal Home Loan Mortgage Corporation is wholly owned by the Federal Home Loan Banks. The Mortgage Corporation is a corporate instrumentality of the United States. Freddie Macs are registered securities. Principal and interest passed through the Mortgage Corporation and then to the City monthly. These instruments have an assumed life of approximately 12 years and pay is a publicly traded, government-sponsored enterprise created to promote stability and affordability in the housing market by purchasing mortgages from banks and other loan makers. Freddie Mac’s term debt products offer investors both short-term notes (maturities of one year or less) or callable medium-term notes, typically one to fifteen years and pays interest semi-annually on a 30/360-day basis.

Other U.S. government securities available to the City for investment purposes include:

Student Loan Marketing Association (SLMA or Sallie Mae), Aid for International Development (AID), and debentures of Tennessee Valley Authority (TVA). However, Attachment “A”
8 these instruments are not offered on a regular basis and do not offer the same liquidity as the before mentioned instruments.

3. Time Deposits or Certificates of Deposit
Time deposits are placed with commercial banks and savings and loan agencies or state or federal credit unions. A time deposit is a receipt for funds deposited in a financial institution for a specified period of time at a specified rate of interest. Generally, the time is 3 months to 5 years. Denominations can be any agreed upon amount and interest is normally calculated using actual number of days on a 360-day 365-day year and paid monthly. Deposits of $100,000 up to $250,000 (commonly referred to as Jumbo C.D.’s) per institution are insured by the government Federal Deposit Insurance Corporation (FDIC) and collateralized Certificates of Deposit can be supported by either 110% U.S.

Government agency notes or 150% mortgages currently held by the bank, or savings and loan or credit union. An institution must meet the following criteria to be considered by the City: maintain a net worth to asset ratio of at least 3% and a positive earnings record.

1. The institution must maintain a net worth to asset ratio of at least 3% and a positive earnings record;

2. The institution must be in compliance with the Financial Institution Reform Act (FIRREA) capital ratio requirements for risk-based, tangible, and core capital; and

3. The institution must make available a current FDIC call reports (banks) or FHLB report. A call report presents the financial condition of the institution to the agency with oversight responsibility of that institution.

4. Negotiable Certificates of Deposit
Negotiable Certificates of Deposit are a form of Certificate of Deposit that have been an important money market instrument since 1961 when commercial banks began issuing them and a secondary market developed to provide liquidity. Since these certificates of deposit can be traded in the secondary market, they are negotiable instruments, hence their name negotiable certificate of deposit. They are supported only by the strength of the institution from which they are purchased. This is a riskier investment that provides a higher yield than regular certificates of deposit. Some issues have quarterly floating rates that mean they will more closely approximate the market in yield. Interest is paid semiannually (quarterly on the floaters) computed on a 30/360-day basis. Maturities range from 3 months to 2 years. Negotiable Certificates of Deposit are generally issued in blocks of $1 million, $5 million, $10 million and so on.

The City will restrict its investments in Negotiable Certificates of Deposit to the 100 largest United States banks and 100 largest international banks according to asset size. The profitability of the financial institution as well as its financial stability is also taken into account prior to placing the investment. As a general rule, the City will not place more than 15% of its portfolio in Negotiable Certificates of Deposit with one institution or 20% of its portfolio with any one Commercial Bank or savings and loan association in any form of Certificate of Deposit.

5. Bankers’ Acceptance Notes
A banker’s acceptance (B.A.) is a unique credit instrument used to finance both domestic and international transactions. As a money market instrument, it is an attractive shortterm investment. When a bank “accepts” such a time draft, it becomes, in effect, a Attachment “A”
9 predated certified check payable to the bearer at some future, specified date. Little risk is involved because the commercial bank assumes primary liability once the draft is accepted. Banker’s acceptances are frequently in odd amounts. Maturities normally range from 30 up to 180 days. Banker’s acceptances are sold at a discount. This means, the face amount is received at maturity. The City will purchase B.A.’s only of the top 100 U.S. or Foreign Banks. The profitability of the financial institution as well as its financial stability is also taken into account prior to placing the investment.

6. Commercial Paper
Commercial paper is the trade name applied to unsecured promissory notes issued by finance and industrial companies to raise funds on a short-term basis. Commercial paper can be purchased on an interest bearing or discount basis. Interest bearing instruments pay interest semi-annually. Discounted instruments pay interest at maturity. The City will invest in commercial paper only if the yields are attractive, and if the paper is rated A-1 by Moody’s and by Standard & Poor’s rating services attains the highest letter and number rating as provided for by national recognized statistical-rating organization (NRSRO).

Maturities range from 30 to 180 days with interest computed on a 30/360-day basis.

7. Medium-Term Notes
In recent years, this financing mechanism has grown, providing capital to the private sector, and diminishing the Negotiable Certificate of Deposit market. The trend towards medium term notes related to buyer and seller flexibility and convenience. The notes are issued on any given date and maturing on a negotiated date. They generally range from 2 to 5 years in maturity. This market provides an excellent alternative to Negotiable C.D.’s.

A Medium-term note is a form of privately placed debt in a bond format. It refers to any fixed-income security with a maturity longer than 1 year, typically issued by financial institutions, corporations and public finance borrowers. The City will only purchase Medium Term Notes with ratings of A or its equivalent or better with maturities of 5 years or less. Their interest is calculated on a 30/360-day basis like Agency bonds. Interest is paid semi-annually.

8. Capital Stock
The City will only invest on water shares from local water companies as they become available.

89. Local Agency Investment Fund demand deposit
The Local Agency Investment Fund (LAIF) was established by the state to enable treasurers to place funds in a pool for investments. The LAIF has been particularly beneficial to those jurisdictions with small portfolios. Each agency is limited to an investment of $15.0 $75.0 million. Porterville uses this fund for short-term liquidity, investment, and yield when rates are declining. Funds are available on demand. At present, two accounts have been opened; one for the City and one for Porterville Redevelopment Agency. Interest and interest is paid quarterly.

9.10. Central San Joaquin Valley Risk Management Authority (CSJVRMA) investment pool As a member city of the CSJVRMA, the City accepted the opportunity in July 2001 to participate in its sponsored investment pool. The pool is managed by Chandler Asset Management and invests in agency instruments such as Federal Home Loan Bank, treasuries and high-grade corporate stock. Funds are available on demand, with interest Attachment “A”
Attachment A
paid quarterly on a monthly basis.

10.11. County of Tulare investment pool
Porterville participates in the County of Tulare’s investment pool that is managed by the County Treasurer, O. Gerald Fields. The County invests in the same type of Stateapproved instruments, as does the City. Funds are available on demand, and interest is paid quarterly.

12. California Cooperative Liquid Assets Securities System (CLASS) California CLASS is a Joint Powers Authority investment pool that provides public agencies the opportunity to invest funds on a cooperative basis in rated pools that are managed in accordance with state law. Its primary objective is to offer participants safety, daily and next-day liquidity and optimized returns. The funds is an investment option and diversification tool for short-term and medium-term investments. Funds are available on demand with interest paid on a monthly basis.

Investments not specifically approved by this policy are prohibited.

STATE AND CHARTER REGULATIONS DIVERSIFICATION REQUIREMENTS The City of Porterville will diversify its investment portfolio in order to reduce exposure to risk by combining a variety of investments, limiting investment in securities with higher credit risks, investing in instruments with varying maturities, and continuously investing a portion of the portfolio in readily available funds to ensure that appropriate liquidity is maintained to meet ongoing obligations.

The City operates its investment pool with many State and self-imposed constraints. In accordance with SB 564 and SB 866, effective January 1, 1996, the City Treasurer will bring this Policy before City Council annually for its reaffirmation. Government Code Section 53601 (et seq) restricts the City portfolio mix to:

1. 30% in Medium Term Notes, not to exceed 5 years in maturity;

2. 30% in Negotiable Certificates of Deposit, not to exceed 5 years in maturity;

3. 40% in Banker’s Acceptance Notes, not to exceed 180 days in maturity;

4. 25% in Commercial Paper, not to exceed 270 days in maturity; and

5. 50% in Placement Service Certificates of Deposit, not to exceed 5 years in maturity (On January 1, 2026, reverts back to 30% maximum percentage of the portfolio.) These restrictions primarily apply to short-term investments and are interpreted to apply at the time of investment. If, as the portfolio mix changes over time, a particular segment exceeds these restrictions, the prudent investor rule shall apply. The City does not buy stocks and it does not speculate. The City will be selective in purchasing long-term negotiable certificates of deposit and medium-term notes, placing such an investment only with a large stable institution.

MATURITY OF INVESTMENTS
The City of Porterville will operate a portfolio with an average life of three years or less. This is to insure ensure liquidity and the ability to move with changing markets and interest rate movements.

Accordingly, no investment will be made in securities that have a final maturity over five years.

The long-term securities shall only be Treasury Notes and Bonds and Mortgage Backed Securities.

Attachment “A”
Attachment A

PERIODIC REPORTING
Also in accordance with SB 564 and SB 866, each quarter, On a quarterly basis, the City Treasurer/Finance Director will issue a report of the City’s current investment portfolio, detailing securities, purchase and maturity date, and face and market value, weighted average rate of earnings, weighted average days to maturity, and the percentage of liquid holdings. This report will also confirm that current portfolio holdings are in compliance with this policy and that the City’s cash needs will be met.

Each quarter some of the long-term investments will be reviewed in order to determine if it is advantageous to sell those securities and purchase others. The review will consider current market conditions and various spread relationships among security types. The monitoring of the conditions set forth in this policy statement is the responsibility of the City Treasurer/Finance Director or delegate.

INVESTMENT POLICY ADOPTION
The City’s investment policy shall be reviewed periodically by the City Council for consistency with the City’s overall investment objectives regarding preservation of principal, liquidity, return, and relevance to current law as well as to current financial and economic trends. Any modifications necessary must be approved by the City Council and the investment policy shall be adopted in its entirety by resolution of the City Council. 1 CITY OF PORTERVILLE
Statement of Investment Policy

INTRODUCTION
The City of Porterville has a fiduciary responsibility to maximize the productive use of its liquid assets entrusted to its care and to manage those public funds wisely and prudently. The purpose of this document is to identify various policies and procedures that enhance opportunities for a prudent and systematic investment policy and to organize and formalize investment-related activities. Related activities, which comprise good cash management, include accurate cash projections, the expeditious collection of revenue, the control of disbursements, cost-effective banking relations, and short-term borrowing programs which coordinate working capital requirements and investment opportunity. In concert with these requirements are the many facets of an appropriate and secure short-term investment program.

SCOPE
It is intended that this investment policy cover all funds and investment activities under the direct authority of the City of Porterville organization. This policy does not cover any funds held by the fiscal agent in connection with the issuance of any bonds by the City. Such funds shall be invested in accordance with the applicable trust indenture.

PHILOSOPHY
The basic premise underlying Porterville’s investment philosophy is to ensure that money is always available when needed. A minimum amount of 6 percent of the adopted operating budget for all funds is maintained in immediately available investments, such as the State Treasurer’s Local Agency Investment Fund or other cash equivalents.

Porterville takes an active investment posture in an attempt to earn a higher yield. This investment posture is best demonstrated by the City’s long-term investments. By taking advantage of the positive yield curve (i.e., longer term rates are higher than shorter maturities), in the long run, the City should average a higher yield.

The City’s investments will be limited to an average life of three years or less. When the market warrants purchase of longer maturities to capture a higher rate of return, purchases will be limited to United States Treasury Notes and Bonds, Federal Agencies Notes and Bonds, Medium Term Notes, Time Deposits or Certificates of Deposit, and Negotiable Certificates of Deposit. No investment will be made in securities that have a final maturity over five years.

The economy and various markets are monitored carefully to assess the probable course of interest rates. In a market with increasing interest rates, the City will attempt to invest in securities with shorter maturities. This makes funds available for other investments when the interest rates are higher. When interest rates appear to be near a relatively high rate, the City will attempt to purchase investments with medium to long-term maturities to lock in the higher rate of return.

When interest rates are falling, the City will invest in securities with longer maturities to hold the higher rate for a longer period of time.

The City will also take advantage of any new vehicle that becomes eligible for municipal investment only after a detailed study of the investment, its safety, liquidity, and yield. 2 INVESTMENT OBJECTIVES
As per California Government Code Section 53600.5, the primary objectives, in priority order of the City of Porterville’s investment activities shall be:

1. Safety: Safety of principal is the foremost objective of the investment program.

Investments of the City shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio with the objective of mitigating credit risk and interest rate or market risk.

Credit risk is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Investments will be limited to the types of securities authorized in this policy. The City will diversify its investment portfolio in order to minimize the impact of potential losses from any one type of security or from any one individual issuer.

Interest rate or market risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The investment portfolio will be structured so that securities mature to meet cash requirements for ongoing operations, thereby avoiding the need to sell securities prior to maturity. Securities shall generally be held until maturity.

2. Liquidity: The City’s investment portfolio will remain sufficiently liquid to enable the City to meet all payment requirements, including but not limited to payroll, accounts payable, capital projects, debt service, and other payments which might be reasonably anticipated.

3. Yield: The City’s investment portfolio shall be designed and managed with the objective of maximizing return throughout budgetary and economic cycles, commensurate with the City’s investment risk constraints and the cash flow characteristics of the portfolio.

The Treasurer/Finance Director and staff will avoid any transactions that might impair public confidence in the City.

PRUDENT INVESTOR STANDARD
The City adheres to the guidance provided by the “prudent person standard,” as set forth in California Government Code Section 53600.3.

The ” prudent person standard” shall be applied in the context of managing an overall portfolio.

Investments shall be made with judgement and care, under circumstances then prevailing, which persons of prudence, discretion and intelligence exercise in the management of their own affairs; not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived. Investment officers 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 the deviations from expectations are reported in a timely fashion and appropriate action is taken to control adverse developments.
3 ETHICS AND CONFLICTS OF INTEREST
Investment officers shall disclose material interests in financial institutions with which they do business, disclose personal financial interests that could be related to the performance of the investment portfolio and refrain from undertaking personal investment transactions with the same individual with whom business is conducted on behalf of the City.

DELEGATION OF AUTHORITY
The City Council hereby delegates responsibility for the management of the investment program to the City Treasurer/Finance Director, who shall establish procedures for the operation of the investment program consistent with this investment policy. Under the provision of California Government Code 53603.3, the Treasurer/Finance Director is a trustee and a fiduciary subject to the prudent investor standard. The Treasurer/Finance Director will review the investment holdings monthly and ensure that they are in compliance with the City investment policy.

The Treasurer/Finance Director may delegate all or a portion of his/her investment authority. Prior to delegation, the Treasurer/Finance Director shall notify the City Council and request confirmation of the delegation. Delegation of investment authority will not remove or abridge the Treasurer/Finance Director’s investment responsibility.

SAFEKEEPING AND CUSTODY
Securities owned by the City shall be held in safekeeping by third-party custodians acting as agent for the City and shall be evidenced by safekeeping receipts. The purchase of securities shall be conducted on a standard delivery versus payment (DVP) basis that guarantees the transfer of securities only after payment is made. The DVP system eliminates principal risk, decreasing the probability of not meeting delivery and/or payment obligations and reducing the possibility of liquidity risk. The third-party custodians are required to provide monthly statements illustrating the balance of securities held by those custodians.

Investments in investment pools and some certificates of deposit are not subject to delivery or third-party safekeeping requirements.

INTERNAL CONTROLS
The Treasurer/Finance Director is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the City are protected from loss, theft or misuse.

The internal controls shall include separation of duties, safekeeping of securities and written confirmation of phone transactions and wire transfers.

AUTHORIZED FINANCIAL DEALERS AND INSTITUTIONS
The City of Porterville will maintain a list of banks, savings and loans, credit unions, and securities dealers authorized to provide investment services. Approved broker/dealers and financial institutions should meet all requirements established by federal and state law. Criteria to be considered in the selection will include creditworthiness, expertise and the types of securities.

Qualifying financial dealers and institutions must provide the City with audited financial statements, proof of National Association of Securities Dealers (NASD) certification, and a certification of having read, understood and agreeing to comply with this investment policy. 4 AUTHORIZED INVESTMENTS
Investments are made in accordance with California State Code and include the following:

1. Securities of the U.S. Government

Securities of the Government include U.S. Treasury bills, notes and bonds.

U. S. Treasury Bills - are issued by the U.S. Treasury and are available in maturities out to one year. They are non-interest bearing and sold on a discount basis. The face amount is paid at maturity.

Treasury Notes - are issued by the U.S. Treasury with maturities from two to ten years.

They are issued in coupon form and many issues are also available in registered form.

Interest is payable at six-month intervals until maturity.

Treasury Bonds - are issued by the U.S. Treasury with maturities of ten years to thirty years. The City may purchase the interest and/or principal of a U.S. Treasury Bond. A principal only instrument is commonly called a “stripped” or “zero” coupon. Stripped coupons are sold at discount basis. The face amount is paid at maturity.

2. Securities of U.S. Government Agencies
The United States Treasury initially financed the capital of U.S. Government agencies.

But as they have grown and operated profitably over the years, the Treasury’s investment has been replaced in large measure by private capital. At the present time, obligations of only a few agencies are backed by the full faith and credit of the U.S. Government. The obligations of all the federal agencies described in the following sections are not guaranteed by the U.S. Government but are considered to be investments of the highest quality.

Federal National Mortgage Association (Fannie Mae) is a publicly traded governmentsponsored enterprise created to provide liquidity, stability and affordability to the mortgage market by purchasing mortgages from banks, savings and loans and mortgage companies. Fannie Mae issues both short-term debt with maturities of a year or less and long-term debt with maturities of over a year and can either be callable or noncallable with interest payments paid semi-annually on a 30/360-day basis.

Federal Home Loan Banks are cooperatively owned by member financial institutions and provide a steady supply of lendable funds to financial institutions such as community banks, credit unions, commercial and savings banks, insurance companies, and community development financial institutions. They provide liquidity to their members to support housing finance and community development through all economic cycles. The agency offers bonds in the public market with majority of issues between one and five years. Interest is paid semi-annually on a 30/360-day basis.

Federal Farm Credit Bank (FFCB) Agency bonds are debt instruments issued to support rural communities and agriculture with reliable, consistent credit and financially related services. Fixed rate bonds which maybe callable or non-callable are regularly issued with typical maturities of one to five years. Designated bonds are non-callable securities with typical maturities of two to ten years. Interest payments are made semi-annually on a 30/360-day basis.
5 Federal Home Loan Mortgage Corporation (Freddie Mac) is a publicly traded, government-sponsored enterprise created to promote stability and affordability in the housing market by purchasing mortgages from banks and other loan makers. Freddie Mac’s term debt products offer investors both short-term notes (maturities of one year or less) or callable medium-term notes, typically one to fifteen years and pays interest semiannually on a 30/360-day basis.

3. Time Deposits or Certificates of Deposit
Time deposits are placed with commercial banks, savings and loan agencies or state or federal credit unions. A time deposit is a receipt for funds deposited in a financial institution for a specified period of time at a specified rate of interest. Generally, the time is three months to five years. Denominations can be any agreed upon amount and interest is normally calculated using actual number of days on a 365-day year and paid monthly.

Deposits of up to $250,000 (commonly referred to as Jumbo C.D.’s) per institution are insured by the Federal Deposit Insurance Corporation (FDIC) and collateralized Certificates of Deposit can be supported by either 110% U.S. Government agency notes or 150% mortgages currently held by the bank, savings and loan or credit union. An institution must maintain a net worth to asset ratio of at least 3% and a positive earnings record;

4. Negotiable Certificates of Deposit
Negotiable Certificates of Deposit are a form of Certificate of Deposit that have been an important money market instrument since 1961 when commercial banks began issuing them and a secondary market developed to provide liquidity. Since these certificates of deposit can be traded in the secondary market, they are negotiable instruments, hence their name negotiable certificate of deposit. They are supported only by the strength of the institution from which they are purchased. This is a riskier investment that provides a higher yield than regular certificates of deposit.

The City will restrict its investments in Negotiable Certificates of Deposit to the 100 largest United States banks and 100 largest international banks according to asset size. The profitability of the financial institution as well as its financial stability is also taken into account prior to placing the investment. As a general rule, the City will not place more than 15% of its portfolio in Negotiable Certificates of Deposit with one institution or 20% of its portfolio with any one Commercial Bank or savings and loan association in any form of Certificate of Deposit.

5. Bankers’ Acceptance Notes
A banker’s acceptance (B.A.) is a unique credit instrument used to finance both domestic and international transactions. As a money market instrument, it is an attractive shortterm investment. When a bank “accepts” such a time draft, it becomes, in effect, a predated certified check payable to the bearer at some future, specified date. Little risk is involved because the commercial bank assumes primary liability once the draft is accepted. Banker’s acceptances are frequently in odd amounts. Maturities normally range from 30 up to 180 days. Banker’s acceptances are sold at a discount. This means, the face amount is received at maturity. The City will purchase B.A.’s only of the top 100 U.S. or Foreign Banks. The profitability of the financial institution as well as its financial stability is also taken into account prior to placing the investment. 6 6. Commercial Paper
Commercial paper is the trade name applied to unsecured promissory notes issued by finance and industrial companies to raise funds on a short-term basis. Commercial paper can be purchased on an interest bearing or discount basis. Interest bearing instruments pay interest semi-annually. Discounted instruments pay interest at maturity. The City will invest in commercial paper only if the yields are attractive, and if the paper attains the highest letter and number rating as provided for by a national recognized statistical-rating organization (NRSRO). Maturities range from 30 to 180 days with interest computed on a 30/360-day basis.

7. Medium-Term Notes
A Medium-term note is a form of privately placed debt in a bond format. It refers to any fixed-income security with a maturity longer than 1 year, typically issued by financial institutions, corporations and public finance borrowers. The City will only purchase Medium Term Notes with ratings of A or its equivalent or better, with maturities of five years or less. Their interest is calculated on a 30/360-day basis like Agency bonds.

Interest is paid semi-annually.

8. Capital Stock
The City will only invest on water shares from local water companies as they become available.

9. Local Agency Investment Fund
The Local Agency Investment Fund (LAIF) was established by the state to enable treasurers to place funds in a pool for investments. The LAIF has been particularly beneficial to those jurisdictions with small portfolios. Each agency is limited to an investment of $75.0 million. Porterville uses this fund for short-term liquidity, investment, and yield when rates are declining. Funds are available on demand and interest is paid quarterly.

10. Central San Joaquin Valley Risk Management Authority (CSJVRMA) Investment Pool As a member city of the CSJVRMA, the City accepted the opportunity in July 2001 to participate in its sponsored investment pool. The pool is managed by Chandler Asset Management and invests in agency instruments such as Federal Home Loan Bank, treasuries and high-grade corporate stock. Funds are available on demand, with interest paid on a monthly basis.

11. County of Tulare Investment Pool
Porterville participates in the County of Tulare’s investment pool that is managed by the County Treasurer. The County invests in the same type of State-approved instruments, as does the City. Funds are available on demand, and interest is paid quarterly. 7 12. California Cooperative Liquid Assets Securities System (CLASS) California CLASS is a Joint Powers Authority investment pool that provides public agencies the opportunity to invest funds on a cooperative basis in rated pools that are managed in accordance with state law. Its primary objective is to offer participants safety, daily and next-day liquidity and optimized returns. The fund is an investment option and diversification tool for short-term and medium-term investments. Funds are available on demand with interest paid on a monthly basis.

Investments not specifically approved by this policy are prohibited.

DIVERSIFICATION REQUIREMENTS
The City of Porterville will diversify its investment portfolio in order to reduce exposure to risk by combining a variety of investments, limiting investment in securities with higher credit risks, investing in instruments with varying maturities, and continuously investing a portion of the portfolio in readily available funds to ensure that appropriate liquidity is maintained to meet ongoing obligations.

The City operates its investment pool with many State and self-imposed constraints. Government Code Section 53601 (et seq) restricts the City portfolio to:

1. 30% in Medium Term Notes, not to exceed 5 years in maturity;

2. 30% in Negotiable Certificates of Deposit, not to exceed 5 years in maturity;

3. 40% in Banker’s Acceptance Notes, not to exceed 180 days in maturity;

4. 25% in Commercial Paper, not to exceed 270 days in maturity; and

5. 50% in Placement Service Certificates of Deposit, not to exceed 5 years in maturity (On January 1, 2026, reverts back to 30% maximum percentage of the portfolio.) These restrictions primarily apply to short-term investments and are interpreted to apply at the time of investment. If, as the portfolio mix changes over time, a particular segment exceeds these restrictions, the prudent investor rule shall apply. The City does not buy stocks and it does not speculate. The City will be selective in purchasing medium-term notes, placing such an investment only with a large stable institution.

MATURITY OF INVESTMENTS
The City of Porterville will operate a portfolio with an average life of three years or less. This is to ensure liquidity and the ability to move with changing markets and interest rate movements.

Accordingly, no investments will be made in securities that have a final maturity greater than five years.

PERIODIC REPORTING
On a quarterly basis, the City Treasurer/Finance Director will issue a report of the City’s current investment portfolio, detailing securities, purchase and maturity date, face and market value, weighted average rate of earnings, weighted average days to maturity, and the percentage of liquid holdings. This report will also confirm that current portfolio holdings are in compliance with this policy and that the City’s cash needs will be met.

The monitoring of the conditions set forth in this policy statement is the responsibility of the City Treasurer/Finance Director or delegate.
8 INVESTMENT POLICY ADOPTION
The City’s investment policy shall be reviewed periodically by the City Council for consistency with the City’s overall investment objectives regarding preservation of principal, liquidity, return, and relevance to current law as well as to current financial and economic trends. Any modifications necessary must be approved by the City Council and the investment policy shall be adopted in its entirety by resolution of the City Council.

RESOLUTION NO. ____ - 2024

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PORTERVILLE

APPROVING THE STATEMENT OF INVESTMENT POLICY
WHEREAS: An investment policy serves as the foundation of a local agency’s investment goals and priorities and describes the parameters for investing government funds and identifies the investment objectives, preferences or tolerance for risk, constraints on the investment portfolio, and how the investment program will be managed and monitored; and WHEREAS: The California Government Code contains specific provisions regarding the types of investments and practices permitted which are intended to promote the use of reliable, diverse and safe investment instruments to better ensure a prudently managed portfolio worthy of public trust; and
WHEREAS: The Statement of Investment Policy has been developed to provide guidance in the cash, treasury and investment management functions of the City, reducing the exposure to liability and protect the assets of the City with those specific provisions of the California Government Code having been incorporated into the updated Statement of Investment Policy; NOW, THEREFORE, BE IT RESOLVED: That the City Council of the City of Porterville does hereby approve the Statement of Investment Policy, in the form attached hereto as Exhibit A.

PASSED, APPROVED AND ADOPTED this 20th day of February, 2024.

Martha A Flores, Mayor
ATTEST:

Patrice Hildreth, City Clerk
By: ________________________
Fernando Gabriel-Moraga,
Acting Chief Deputy City Clerk
Item No. 8.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: Community Clean-Up Events
SOURCE: Public Works
COMMENT: To encourage local property maintenance and beautification, the City sponsors two clean-up events annually; one in Spring and one in Fall. These events offer city residential refuse customers free disposal of general trash, bulky items, wood waste, yard clippings, and E-waste at the City's Corporation Yard.

Based on the success of prior events, staff recommends the City host two Community Clean-Up Events in 2024. The proposed event dates are Saturday, April 20th, and Saturday, October 19th. Staff is not aware of any common city event conflicts with these dates. The clean-up events are open to all residents receiving City residential refuse service. Staff estimated City costs for both events to be approximately $20,000 and funded through the Solid Waste Operating Budget.

RECOMMENDATION: That City Council:

1. Declare April 20, 2024, "Spring Clean-Up Day" and October 19, 2024, "Fall Clean-Up Day;"

2. Encourage all residents to clean up their properties and take advantage of these special opportunities offered by the City;

3. Authorize the City to accept trash, litter, and yard clippings delivered by City residents receiving City residential refuse service to the Spring and Fall Clean-Up Events for free disposal; and

4. Authorize the cost of both events be funded from the Solid Waste Operating Budget.

ATTACHMENTS:

Appropriated/Funded:

Review By:

Department Director:

Michael Knight, Public Works Director
Final Approver: Patrice Hildreth, City Manager
Item No. 9.

CITY COUNCIL AGENDA – FEBRUARY 20, 2024
SUBJECT: Status and Review of Local Drought Emergency
SOURCE: City Manager's Office
COMMENT: At its meeting of May 5, 2015, the City Council took action to approve a Resolution Declaring a Drought Emergency in the City of Porterville. At its meeting of February 6, 2024, the Council reviewed the status of existence of local emergency, and acted to continue its Resolution of local emergency.

HISTORY:

Governor Brown issued Executive Order B-29-15 on Wednesday, April 1, 2015, which established drought-related mandates and restrictions in addition to those already stipulated in previous Executive Orders B-26-14 and B-28-14. Of significance, the Governor directed the State Water Resources Control Board to impose restrictions to achieve a statewide twenty-five percent (25%) reduction in potable urban water usage through February 28, 2016, in comparison to the amount used in 2013, and with consideration given to per capita usage as a basis. The Governor further directed the Board to impose additional restrictions on commercial, industrial, and institutional properties with significant landscaping (cemeteries, golf courses, parks, schools, etc.), to also achieve a twenty-five (25%) reduction in potable water usage. Also of significance, the Board was directed to prohibit irrigation with potable water outside of newly constructed homes and buildings that is not delivered by drip or micro-spray systems.

On November 13, 2015, Governor Brown issued Executive Order B-36-15, which extends emergency conservation regulations through October 2016, if drought conditions persist through January 2016. On February 2, 2016, the State Water Resources Control Board adopted extended emergency water conservation regulations, to be in effect March 1 through October 31, 2016.

The City of Porterville benefited somewhat from the extended regulations as the City's water conservation rate has been reduced from thirty-two percent (32%) to twenty-six percent (26%), due to new water connections that have been made and population served (4%), as well as a new climate adjustment factor that was considered (2%).

On May 9, 2016, Governor Brown issued Executive Order B-37-16 ("Making Water Conservation a California Way of Life"), which directs the State Water Resources Control Board to establish new regulations making permanent the emergency conservation regulations. On May 18, 2016, the State Water Resources Control Board adopted a statewide water conservation approach that replaces the percentage reduction-based water conservation standard with a Item No. 9.
localized "stress test" approach that mandates urban water suppliers act immediately to ensure at least a three-year supply of water to their customers under continued drought conditions.

On April 7, 2017, Governor Brown issued Executive Order B-40-17, which ended the drought state of emergency in most of California, with the exception of Fresno, Kings, Tulare and Tuolumne counties where emergency water supply and reliability projects are continuing toward addressing diminishing groundwater supplies. The Order maintains monthly reporting requirements and prohibitions on wasteful practices.

On May 31, 2018, Governor Brown signed both AB 1668 (Friedman) and SB 606 (Hertzberg), which set permanent overall targets for indoor and outdoor water consumption. The legislation sets an initial limit for indoor water use of fifty-five (55) gallons per-person per-day in 2022, reducing to 52.5 gallons perperson per-day in 2025, and finally to fifty (50) gallons per-person per-day in 2030. The amount of residential outdoor use is yet-to-be determined, but will allow for varying regional climates. In addition, a standard for water loss due to leak rates in water system pipes will be established. As an urban water provider, the City will need to submit its plan for compliance for approval by the State Water Resources Control Board.

On March 5, 2021, Secretary Vilsack of the United States Department of Agriculture federally-designated Tulare County as a primary natural disaster area due to ongoing drought conditions. On April 21, 2021, Governor Newsom issued a State of Emergency Proclamation due to drought conditions, including Tulare County. On April 27, 2021, the Tulare County Board of Supervisors adopted a Resolution Proclaiming a Local Emergency due to severe drought conditions. On January 4, 2022, the State Water Resources Control Board adopted emergency regulations to supplement voluntary water conservation.

On March 28, 2022, Governor Newsom issued Executive Order N-7-22, that requires the state's largest water providers (including the City of Porterville) to put in place "Level 2" of water shortage contingency plans, which the City is currently in "Level 4." On June 10, 2022, the State Water Resources Control Board adopted emergency regulations to prohibit the watering of nonfunctional or purely decorative grass in commercial, industrial or institutional properties with potable water. On March 24, 2023, due to atmospheric river storms during the month of March 2023, Governor Newsom issued Executive Order N-5-23 that ended the requirement that the state's largest water providers (including the City of Porterville) put in place "Level 2" of water storage contingency plans (the City of Porterville is currently in "Level 4"), as well as ended the voluntary fifteen percent (15%) water conservation target.

At its meeting on January 17, 2023, the Council considered an emergency request from the County of Tulare for assistance to Self-Help Enterprises, Inc. (SHE) in the provision of source water for the Emergency Tank Program that serves 389 residences across Tulare County where domestic wells have run dry due to continued drought. The County had been providing source water from its well at the Bob Wiley Detention Facility, north of Visalia, but the recent Item No. 9.
rainfall had caused damage and the temporary closure of the access road to the well. The Council acted to grant the County's request for emergency assistance and provide source water to SHE to continue the Emergency Tank Program, to be reviewed at its next regular meeting on February 7, 2023. On January 20, 2023, SHE began taking City water for delivery. The County later reported that the access road had been repaired and that the County source well was accessible again to SHE beginning on February 1, 2023. According to the City water meter report, approximately 111,500 gallons of water was accessed by SHE, with a corresponding cost of $350. At Council's direction, City staff has also been in contact and coordinating with the Eastern Tule Groundwater Sustainability Agency (ETGSA) in regard to source water from the ETGSA crossing over into other GSA territories and other Sub-basins (e.g. Kaweah) and addressing any potential impacts, although it is important to note that the same has been happening from the County well that is located in the Kaweah Subbasin.

On August 2, 2023, Council Member Meister was made aware of the lack of drinking water and apparent lack of occasional water availability in the Del Oro Water Company system in the Springville area. During the March 2023 floods, six of the twelve water systems wells were damaged, several of which were damaged beyond repair. City staff was contacted by the Office of State Senator Shannon Grove in regard to the City-County Well Agreement, which dictates that at the request of the State and County, the City shall provide 3,000,000 gallons of water per month for the purpose of meeting emergency water needs in County jurisdiction and shall not charge the State or County for the water.

Senator's Grove's Office has been coordinating with the State and Self-Help Enterprises in the potential placement of temporary tanks until Del Oro has completed its repair projects to sufficiently meet its customer demands.

Initially within the city of Porterville, twenty-six (26) residences within the city were determined to have dry wells, for which City staff submitted a Mutual Aid Request to Tulare County OES to initiate the household tank program for identified properties within the city where wells are dry and challenged for permanent connection. The State has committed funding for non-profit agencies to continue drought-related activities, which Self-Help Enterprises has continued the household tank program locally, through State Cleanup and Abatement Account (CAA) emergency funds.

Representatives for the City, County, State (CalOES, DDW, DWR, and SWB) and non-profit partners continued to meet in support of the long-term permanent water connection project for the entire East Porterville area and the estimated 1,800 expected future connections. DWR identified 423 residential units in the East Porterville area (381 of which are in the City's Urban Development Boundary), that were served by the County's Household Tank Program and desired by the State to be connected to the City's water distribution system as soon as possible. DWR has completed a significant City waterline extension project to permanently connect those 423 residential units to the City's water system (considered Phase I of the project). To provide initial source water for the DWR extension project, CalOES desired to expeditiously connect the new Item No. 9.
well on Olive Avenue to the City's water system instead of being first equipped as a filling station. Given the new well has an estimated water production value of 800 gallons per minute, as well as a SWB assumed 1.5 gallons per minute per residence, the new well could effectively serve up to five hundred (500) single-family residential units. The City indicated its significant interest that the E. Vandalia Avenue area and its eighty (80) residential units be included in the water connection project, to which the State was agreeable.

Given CalOES has paid for the development of the new well, and its connection to the City's water system, the City will be required under "Drought Redundancy and Resiliency Provisions" to make available to the State up to three million gallons of water per month without charge for emergency purposes. On May 7, 2022, Tulare County OES notified the City that due to deteriorating conditions across the county involving small water systems dependent upon the Friant-Kern Canal that may result in the complete lack of water or "Do Not Drink" orders, the State and County may have to invoke the provision of water from the well.

To proceed with the connection of the new well to the City's water system and the 500 East Porterville and E. Vandalia Avenue residential units, the City Council approved modifications to the Draft Agreement between the City and County at its meeting on April 5, 2016, which the County Board of Supervisors subsequently approved at their meeting on May 10, 2016.

A Memorandum of Understanding between the State, County, and City on the East Porterville permanent water connection project was approved by the Council during a Special Meeting on Tuesday, June 21, 2016, and approved by the Board of Supervisors on Tuesday, June 28, 2016. With the approval of the MOU, the State began the permanent connection of approximately forty (40) homes that are located along existing City water mains. Subsequently, the State officially requested that the City approve the connection of an additional thirty (30) residences as part of the first immediate connections, for up to a total of seventy (70), which the Council approved at its meeting on August 2, 2016.

In regards to the new well's development and connection to the City's water distribution system, the Board of Supervisors awarded the contract for equipping and connecting the new well at its meeting on Tuesday, August 16, 2016, and construction activities commenced the week of October 10, 2016.

County staff had previously indicated that the well would be in service and connected to the City's system no later than December 2016, however, the well was operational and connected to the City's water distribution as of Friday, February 17, 2017. Given the delay in the well's completion and connection, DWR requested that the Council consider allowing the connection of residences as they become prepared for connection, to which the Council was receptive, and a Draft MOU Amendment was approved by the Council at its meeting on December 6, 2016, and subsequently approved by the Board of Supervisors at is meeting on December 20, 2016. City staff continued to work with County staff toward the transfer of the well's ownership from the County to the City, which at its meeting on April 20, 2021, the Council approved the draft Transfer Item No. 9.

Agreement subject to the City Attorney's final form.

As of Friday, March 31, 2017, the date the State established as the final day for property owners to complete the registration process to participate in the Statefunded connection program opportunity, of the 1,017 eligible developed residential properties identified by the State for connection, 722 completed the required Extra-Territorial Services Agreement, leaving 295 developed residential properties non-responsive to this unique connection program, twenty-three (23) of which were reported as having either dry or diminishing capacity wells. On February 6, 2018, the final residential connection was made of the approximate eligible eight hundred (800) residences in East Porterville to the City's water system.

City staff continues to coordinate with Self-Help Enterprises and State representatives toward the extension of water mains to serve all residential properties within City limits and the city's periphery that are currently participating in the County's Household Tank Program. The two main areas of focus are N. Cobb Street (northwest of State Route 65 and Pioneer Avenue), and S. Cloverleaf Street (southeast of State Route 65 and Olive Avenue). The State has maintained its commitment to grant-fund the necessary infrastructure and connection fees, providing an official funding letter to the City on January 18, 2018, which commits up to $2.81 million in funding until December 31, 2019. The authorization to advertise for bids for the water connection project was approved by the Council at its July 17th meeting, after which DWR reviewed the bid package for compliance and approved in December the package for advertisement. Council authorized award of the construction contract for approximately $1.82 million at its meeting on January 15, 2019.

City staff conducted a pre-construction public outreach meeting with the affected residents on the status of the project on Thursday, April 4, 2019.

Council authorized the agreement with Self-Help Enterprises Inc. to provide the private residential connections at its meeting on July 2, 2019, and construction work began on the project. At its meeting on October 1, 2019, the Council accepted the public works segment of the project in the installation of water mains as complete, with Self-Help and CSET continuing to collaborate on the completion of the individual private connections and abandonment of private wells. City staff has recently been made aware that there may be a couple of additional residences whose wells are dry that are located along existing City water mains or may require further extension of water mains.

Staff is coordinating with State staff on addressing these new isolated needs.

County OES and the State Division of Drinking Water (DDW) have reported to the City that the Central Mutual Water Company, located south of the city and south of Gibbons Avenue, has had its well run dry and desires an immediate emergency connection to the City's water system to serve the forty-one (41) connections currently without water. DDW is wishing to support a financial application to upgrade the small water system to City standards (new water lines, meters ,etc.), and to sponsor an Urban Development Boundary (UDB) Amendment application to Tulare County Local Agency Formation Commission (LAFCO), given this area is currently outside the City's UDB but Item No. 9.
within the City's Urban Area Boundary (UAB). Given several private wells have run dry in this area, DDW is also attempting to sponsor their connection to the City's water system. For source water capacity for the connections, DWR will include these new connections within the East Porterville water connection capacity development projects. At its Special meeting on August 30, 2019, the City Council directed staff to proceed with the immediate emergency connection of the Central water system, with the permanent connection of the system contingent upon an Agreement with DDW to the sponsorship conditions they have offered. At its meeting on October 1, 2019, the Council directed staff to proceed with the amendment of the UDB to facilitate annexation, which a public meeting with the affected residents was conducted on Wednesday, October 9, 2019. At its meeting on April 21, 2020, the Council conducted a Public Hearing and approved Resolutions of approval of the environmental determination and amendment to the UDB to facilitate annexation. At its meeting on June 1, 2021, the Council approved the State Water Board funding agreement for the development of a City-owned production well, distribution mains and water meters to serve each customer, as well as fire hydrants. On July 20, 2021, the City received notification from the State Water Board that the Akin/Central Water Consolidation Project funding agreement had been formally approved and executed. At its meeting on August 2, 2022, the Council authorized $1,074,948 for the drilling phase of Well 34 (Akin). At its meeting on October 3, 2023, the Council accepted the drilling phase as complete, with the final construction cost of $865,402. The equipping phase is the next step in having this well online by the 2024 calendar year.

DDW has also reported to the City that the Del Oro East Plano water system, located on Paul Street (southeast of the intersection of Plano Street and Worth Avenue), is experiencing problems with its existing well and have implemented severe water restrictions. The East Plano water system serves fourteen (14) residences and approximately forty-five (45) people. DDW is wishing to provide financial support to upgrade the small water system to City standards (new water lines, meters ,etc.), and for source water capacity for the connections, DDW would need to either pay appropriate fees and/or develop a capacity development project. The Council is aware that the Del Oro Grandview Gardens water system (north of W. North Grand Avenue) is also experiencing significant issues, and DDW may seek their future consolidation with the City's water system as well.

DDW has further reported to the City that the Beverly Grand Mutual Water Company water system, located north of West North Grand Avenue, is experiencing problems with its existing well and water quality issues, and desires its connection to the City's system to serve the thirty-one (31) residences the system serves. DDW is wishing to provide financial support to upgrade the small water system to City standards (new water lines, meters ,etc.), and for source water capacity for the connections, DDW has agreed to pay appropriate fees toward developing a capacity development project, which at its meeting of October 3, 2017, the Council approved a purchase agreement with Smee Homes, Inc. for the acquisition of property along the Tule River for the development of a new municipal well. At its meeting of October 1, 2019, the Item No. 9.

Council approved proceeding with the consolidation of the Beverly Grand water system.

RECOMMENDATION: That the City Council receive and review the Declaration of Local Emergency, and determine the need exists to continue said Declaration.

ATTACHMENTS: 1. City of Porterville Resolution Declaring Local Drought Emergency: May 5, 2015

2. City-County Well Agreement - May 10, 2016

3. United States Department of Agriculture Drought Natural Disaster Area Designation: March 5, 2021

4. State of California State of Emergency Proclamation: April 21, 2021

5. County of Tulare Drought Local Emergency Resolution:

April 27, 2021

6. State Water Resources Control Board: Emergency
Regulation - Water Conservation; January 4, 2022

7. Governor Newsom Executive Order N-7-22: March 28,
2022

8. State Water Resources Control Board: Emergency
Regulation - Water Conservation; June 10, 2022

9. Governor Newsom Executive Order N-5-23: March 24,
2023

10. State Water Resources Control Board Funding Agreement:

Akin/Central Water Consolidation Project
Appropriated/Funded:

Review By:

Department Director:

Patrice Hildreth, City Manager
Final Approver: Patrice Hildreth, City Manager

EXECUTIVE DEPARTMENT

STATE OF CALIFORNIA
State of Emergency Proclamation
WHEREAS climate change is intensifying the impacts of droughts on our communities, environment and economy, and California must therefore improve drought resiliency and prepare to respond to more frequent, prolonged, and intense dry periods; and
WHEREAS much of the West is experiencing severe to exceptional drought and California is in a second consecutive year of dry conditions, resulting in drought or near-drought throughout many portions of the State; and WHEREAS these drought conditions can result in degraded water quality, fallowing of productive farmland, setbacks to vulnerable and rural communities through job losses and longer-lasting recoveries, significant impacts to tribal, commercial, and recreational salmon fisheries, constraints on access to traditional lifeways, loss of aquatic and terrestrial biodiversity, and ecosystem impacts; and
WHEREAS drought conditions vary across the State and some watersheds, including the Russian River and Klamath Basin, are extremely dry and are facing substantial water supply and ecosystem challenges; and
WHEREAS it is necessary to expeditiously mitigate the effects of the drought conditions within the Russian River Watershed, located within Mendocino and Sonoma counties, to ensure the protection of health, safety, and the environment; and
WHEREAS experience in the last drought has demonstrated the value of preparing earlier for potential sustained dry conditions, the need to improve our monitoring and forecasting capabilities, and many other lessons that are captured in the Administration1s Report to the Legislature on the 2012-2016 Drought; and
WHEREAS the State and its many partners have strengthened drought resilience since the last drought including state investments in water management systems, implementation of the Sustainable Groundwater Management Act, establishment of the Safe and Affordable Fund for Equity and Resilience Program, development of the Administration's Water Resilience Portfolio, and continued water conservation by Californians whose current statewide urban water use is 16% lower than at the beginning of the last drought; and
WHEREAS state agencies have been actively responding to current drought conditions and preparing for the possibility of a third dry year including through convenings of the interagency drought team, which was established at my direction, to organize, focus, and track changing conditions, coordinate state agency responses, and work closely with partners across the State; and WHEREAS under the provisions of Government Code section 8558(b), I find that the conditions caused by the drought conditions, by reason of their magnitude, are or are likely to be beyond the control of the services, personnel, equipment, and facilities of any single local government and require the combined forces of a mutual aid region or regions to appropriately respond; and
WHEREAS under the provisions of Government Code section 8625(c), I find that local authority is inadequate to cope with the drought conditions; and WHEREAS to protect public health and safety, it is critical the State take certain immediate actions without undue delay to prepare for and mitigate the effects of, the drought conditions within the Russian River Watershed, and under the provisions of Government Code section 8571, I find that strict compliance with various statutes and regulations specified in this Proclamation would prevent, hinder, or delay the mitigation of the effects of the drought conditions of the Russian River Watershed, located within Mendocino and Sonoma counties.

NOW THEREFORE, I, GAVIN NEWSOM, Governor of the State of California, in accordance with the authority vested in me by the State Constitution and statutes, including the California Emergency Services Act, and in particular, section 8625, HEREBY PROCLAIM A STATE OF EMERGENCY to exist in Mendocino and Sonoma counties due to drought conditions in the Russian River Watershed.

IT IS HEREBY ORDERED THAT:

1. To further the success of California's water conservation efforts and increase our drought preparedness, state agencies shall partner with local water districts and utilities to make all Californians aware of drought, and encourage actions to reduce water usage by promoting the Department of Water Resources' Save Our Water campaign
(https://saveourwater.com) and other water conservation programs.

2. To continue coordination with partners across the State for the potential of prolonged drought impacts, the Department of Water Resources, the State Water Resources Control Board (Water Board), the Department of Fish and Wildlife, and the Department of Food and Agriculture shall work with regional and local governments, including groundwater sustainability agencies, to identify watersheds, communities, public water systems, and ecosystems that may require coordinated state and local actions to address issues stemming from continued dry conditions, to ensure that we can respond to water shortages and protect people, natural resources and economic activity.

3. To continue partnership and coordination with Californian Native American tribes, state agencies shall engage in consultation, collaboration, and communication with California Native American tribes to assist them in necessary preparation and response to drought conditions on tribal lands and potential impacts to cultural and traditional resources within ancestral lands.

4. To prioritize drought response and preparedness resources, the Department of Water Resources, the Water Board, the Department of Fish and Wildlife and the Department of Food and Agriculture, in consultation with the Department of Finance, shall:
a. Accelerate funding for water supply enhancement, water conservation, or species conservation projects.
b. Identify unspent funds that can be repurposed to enable projects to address drought impacts to people, ecosystems, and economic activities.
c. Recommend additional financial support for water resilience infrastructure projects and actions for potential inclusion in the upcoming May Revision.

5. To increase resilience of our water supplies during drought conditions, the Department of Water Resources shall:
a. Work with counties to encourage reporting of household water shortages, such as dry residential wells, on the website the Department maintains for that purpose, to enable tracking of drought impacts.
b. Work with counties, and groundwater sustainability agencies as appropriate, to help ensure that well drillers submit required groundwater well logs for newly constructed and deepened wells in a timely manner.
c. Work with agricultural water suppliers and agricultural water users to provide technical assistance, including implementation of efficient water management practices and use of technology such as the California Irrigation Management Information System.
d. Work with urban and agricultural water suppliers to encourage timely submittal by water districts and public posting of urban water management and water shortage contingency plans and
agricultural water management and drought plans.
e. Accelerate updating the land subsidence data it is providing to support implementation of the Sustainable Groundwater
Management Act.

6. To increase resilience of our water systems during drought conditions, the Water Board shall:
a. Use its authority, provide technical assistance, and where feasible provide financial assistance, to support regular reporting of drinking water supply well levels and reservoir water levels where the Water Board determines that there is risk of supply failure because of lowering groundwater levels or reservoir levels that may fall below public water system intakes.
b. Prioritize the permitting of public water systems that anticipate the need to activate additional supply wells where water quality is a concern and treatment installation needs to proceed to relieve a system's potential supply concerns.
c. Provide annual water demand data, information on water right priority, and other communications on water availability on its website.
d. Identify watersheds where current diversion data is insufficient to evaluate supply impacts caused by dry conditions, and take actions to ensure prompt submittal of missing data in those watersheds.

7. To address the acutely dry conditions in the Russian River Watershed, the Water Board shall consider:
a. Modifying requirements for reservoir releases or diversion limitations in that watershed to ensure adequate, minimal water supplies for critical purposes.
b. Adopting emergency regulations to curtail water diversions when water is not available at water rights holders' priority of right or to protect releases of stored water.

For purposes of carrying out this directive, Public Resources Code, Division 13 (commencing with section 21000) and regulations adopted pursuant to that Division are suspended in the counties of Mendocino and Sonoma to the extent necessary to address the impacts of the drought in the Russian River Watershed. The Water Board shall identify the projects eligible for the suspensions pursuant to this paragraph and maintain on its websites a list of the activities or approvals for which these provisions are suspended.

8. To ensure that equipment and services necessary for drought response in the Russian River Watershed can be procured quickly, the provisions of the Government Code and the Public Contract Code applicable to procurement, state contracts, and fleet assets, including, but not limited to, advertising and competitive bidding requirements, are hereby suspended to the extent necessary to address the effects of the drought in the Russian River Watershed, located within Mendocino and Sonoma counties. Approval of the Department of Finance is required prior to the execution of any contract entered into pursuant to this provision.

9. To increase the resilience of our natural habitats to protect vulnerable species during drought conditions, the Department of Fish and Wildlife shall:
a. Evaluate and take actions to protect terrestrial and aquatic species and, wherever possible, work with water users and other parties on voluntary measures to protect species.
b. Work to improve State hatcheries and increase water use efficiency on State wildlife areas and ecological reserves to maintain habitat for vulnerable species.
c. Respond to human-wildlife interactions related to ongoing dry conditions and increase public messaging and awareness. d. Work with commercial and recreational salmon fishing and tribal representatives to anticipate and develop strategies to mitigate and respond to salmon fishery impacts, with particular emphasis on addressing impacts to salmon fisheries in the Klamath Basin.

10.To support our agricultural economy and food security during drought conditions, the Department of Food and Agriculture shall:
a. Provide technical assistance to support conservation planning, onfarm water and energy conservation practices and technologies, including augmenting the State Water Efficiency and Enhancement Program.
b. Conduct an economic analysis of drought impacts to agriculture, including land use, jobs, and rural food economies, expanding on existing research done in the last drought to include thorough regional analysis especially in the Central Valley, and in the implementation of the Sustainable Groundwater Management Act and alternative land uses for fallowed land.
c. Maintain a web page with drought resources for farmers and ranchers, including the United States Department of Agriculture and other federal and state resources.
d. Work with federal agencies to assist Klamath Basin farmers and ranchers contending with reduced water supplies.

11.To ensure the potential impacts of drought on communities are anticipated and proactively addressed, the Department of Water Resources, in coordination with the Water Board, shall develop groundwater management principles and strategies to monitor, analyze, and minimize impacts to drinking water wells.

12.To provide critical information on the different drought conditions across the State, the Department of Water Resources, in consultation with the Department of Fish and Wildlife, the Department of Food and Agriculture, and the Water Board, shall develop a California Drought Monitor by December 31, 2021, as recommended in the Administration's Report to the Legislature on the 2012-2016 Drought.

13.To prepare for potential salinity issues in the Delta, the Department of Water Resources, in consultation with the Water Board, the Department of Fish and Wildlife, the Delta Stewardship Council, and the Central Valley Flood Protection Board, shall initiate actions necessary to prepare for and address potential Delta salinity issues during prolonged drought conditions.

14.To prepare for potential impacts of drought conditions on species, the Water Board and the Department of Fish and Wildlife shall work with federal agency partners to manage temperature conditions for the preservation of fish in the Sacramento River downstream of Shasta Dam while balancing water supply needs.

This Proclamation is not intended to, and does not, create any rights or benefits, substantive or procedural, enforceable at law or in equity, against the State of California, its agencies, departments, entities, officers, employees, or any other person.

I FURTHER DIRECT that as soon as hereafter possible, this Proclamation be filed in the Office of the Secretary of State and that widespread publicity and notice be given of this Proclamation.

IN WITNESS WHEREOF I have hereunto set
my hand and caused the Great Seal of the
State of alifornia t be affixed this 21st
day of ril 2021
ATTEST:

RESOLUTION PROCLAIMING A LOCAL EMERGENCY

BY THE BOARD OF SUPERVISORS

COUNTY OF TULARE, STATE OF CALIFORNIA

IN THE MATTER OF A

LOCAL EMERGENCY DUE TO )

SEVERE DROUGHT CONDITIONS)
RESOLUTION NO. 2021-0290
WHEREAS, California's most recent drought spanning from approximately 2012 to 2018 required the proclamation of a Local Emergency by the County of Tulare from February 2014 to November 2019, as well as a Governor's State of Emergency and the combined resources of multiple local, state, and federal agencies, commercial entities, and non-profit organizations to mitigate; and
WHEREAS, over 3,000 failed or dry wells - including private domestic, community, and agricultural wells - were reported to Tulare County from 2014 to 2017 as a result of the prior drought, causing significant health, safety, and economic issues for Tulare County residents and businesses; and
WHEREAS, well over $100 million in emergency relief and permanent infrastructure projects were expended to mitigate the effects of the prior drought; and WHEREAS, a hydrological year ("water year") runs from October 1 to September 30 of the following year; and
WHEREAS, the current water year beginning October 1, 2020 is, to date, the third-driest on record, with potential to become the driest on record without significant additional precipitation which is unlikely to occur during the traditionally dry months; and WHEREAS, the United States Drought Monitor shows that 94.51 % of Tulare County is currently experiencing "Extreme Drought" (D3) conditions and the remaining 5.49% is in "Severe Drought" (D2) conditions, and the County of Tulare anticipates that these conditions will progress to "Exceptional Drought" (D4) conditions as occurred in the prior drought based on the current Southern Sierra snowpack measured at only 15% of historical average for April 1st, drastically reduced surface water allocations on the State Water Project and Central Valley Project, and correspondingly low water levels in local reservoirs ; and WHEREAS, surface water supply constraints create a demonstrable and unsustainable increase in demand for groundwater which is likely to cause additional dry wells for community water systems, private domestic wells, and agricultural wells, creating economic hardships and conditions of extreme peril to the health and safety of individuals within Tulare County requiring the combined forces of all levels of government to mitigate; and WHEREAS, California Government Code section 8630 empowers the Board of Supervisors to proclaim the existence or threatened existence of a local emergency; and WHEREAS, Section 1-15-1005 of the Tulare County Ordinance Code defines "emergency" to include "the actual or threatened existence of conditions of disaster or of extreme peril to the safety of persons and property within [Tulare] County caused by such conditions as air pollution, fire, flood , storm , epidemic, riot, earthquake, or other conditions, ... which conditions are or are likely to be beyond the control of the services, personnel, equipment, and facilities of [Tulare] County, requiring the combined forces of other political subdivisions to combat"; and
NOW, THEREFORE, IT IS HEREBY PROCLAIMED that a local emergency now exists throughout said Tulare County due to drought which has created conditions of disaster and extreme peril to the safety of persons and property within the County, and that such conditions are or are likely to be beyond the control of the services, personnel , equipment, and/or facilities of this County, thus requiring the combined forces of other political subdivisions to combat; and IT IS FURTHER PROCLAIMED that this local emergency is proclaimed pursuant to the California Emergency Services Act, California Government Code §8550 et seq.; and IT IS REQUESTED that the Governor of the State of California find and proclaim Tulare County to be in a State of Emergency, and make available any and all material and financial support and resources necessary to combat the conditions of disaster, including but not limited to California Disaster Assistance Act funding for emergency protective measures and increased funding to relevant programs of the State Water Resources Control Board and Department of Water Resources ; and
IT IS FURTHER REQUESTED that the Governor waive and all regulations and statutes that may hinder response to this emergency; and
IT IS PROCLAIMED AND ORDERED that during the existence of said local emergency, the powers, functions, and duties of the emergency organization of Tulare County shall be those prescribed by State law, by ordinances and resolutions of Tulare County, and by the Tulare County Operational Area Emergency Operations Plan, as approved by the Board of Supervisors.

UPON MOTION OF SUPERVISOR MICARI, SECONDED BY SUPERVISOR

TOWNSEND, THE FOLLOWING WAS ADOPTED BY THE BOARD OF
SUPERVISORS, AT AN OFFICIAL MEETING HELD APRIL 27, 2021 , BY THE FOLLOWING VOTE:

AYES: SUPERVISORS MICARI , VANDERPOEL, SHUKLIAN, VALERO AND

TOWNSEND
NOES: NONE
ABSTAIN : NONE
ABSENT: NONE
~~~smia~rp__e:w. "fl
ATTEST:

BY:

JASON T. BRITT

COUNTY ADMINISTRATIVE OFFICER/

CLERK, BOARD OF SUPERVISORS

STATE WATER RESOURCES CONTROL BOARD
RESOLUTION NO. 2022-0002

TO ADOPT AN EMERGENCY REGULATION

TO SUPPLEMENT VOLUNTARY WATER CONSERVATION
WHEREAS:

1. On April 21, May 10, and July 8, 2021, Governor Newsom issued proclamations that a state of emergency exists in a total of 50 counties due to severe drought conditions and directed state agencies to take immediate action to preserve critical water supplies and mitigate the effects of drought and ensure the protection of health, safety, and the environment.

2. On October 19, 2021, Governor Newsom signed a proclamation extending the drought emergency statewide and further urging Californians to reduce their water use.

3. There is no guarantee that winter precipitation will alleviate the current drought conditions.

4. Many Californians have taken bold steps over the years to reduce water use; nevertheless, the severity of the current drought and uncertainty about Water Year 2022 require additional conservation actions from residents and businesses.

5. Water conservation is the easiest, most efficient, and most cost-effective way to quickly reduce water demand and extend supplies into the next year, providing flexibility for all California communities. Water saved is water available next year, giving water suppliers the flexibility to manage their systems efficiently. The more water that is conserved now, the less likely it is that a community will experience such dire circumstances or that water rationing will be required.

6. Most Californians use more water outdoors than indoors. In many areas, 50 percent or more of daily water use is for lawns and outdoor landscaping. Outdoor water use is generally discretionary, and many irrigated landscapes would not suffer greatly from receiving a decreased amount of water.
2 7. Public information and awareness are critical to achieving conservation goals, and the Save Our Water campaign (SaveOurWater.com), run jointly by the Department of Water Resources (DWR) and the Association of California Water Agencies, is an excellent resource for conservation information and messaging that is integral to effective drought response.

8. SaveWater.CA.Gov is an online tool designed to help save water in communities. This website lets anyone easily report water waste from their phone, tablet, or computer by simply selecting the type of water waste they see, typing in the address where the waste is occurring, and clicking send.

These reports are filed directly with the State Water Resources Control Board (State Water Board or Board) and relevant local water supplier.

9. Enforcement against water waste is a key tool in conservation programs.

When conservation becomes a social norm in a community, the need for enforcement is reduced or eliminated.

10. On October 19, 2021, the Governor suspended the environmental review required by the California Environmental Quality Act to allow State Water Board-adopted drought conservation emergency regulations and other actions to take place quickly to respond to emergency conditions.

11. Water Code section 1058.5 grants the State Water Board the authority to adopt emergency regulations in certain drought years in order to: “prevent the waste, unreasonable use, unreasonable method of use, or unreasonable method of diversion, of water, to promote water recycling or water conservation, to require curtailment of diversions when water is not available under the diverter’s priority of right, or in furtherance of any of the foregoing, to require reporting of diversion or use or the preparation of monitoring reports.”

12. On November 30, 2021, the State Water Board issued public notice that the State Water Board would consider the adoption of the regulation at the Board’s regularly scheduled January 4, 2022 public meeting, in accordance with applicable State laws and regulations. The State Water Board also distributed for public review and comment a Finding of Emergency that complies with State laws and regulations.

13. The emergency regulation sets a minimum standard that many communities are already doing more but not everyone is taking these lowcost, easy to implement actions that can save significant amounts of water during a drought emergency.
3 14. Disadvantaged communities may require assistance in increasing water conservation, and state and local agencies should look for opportunities to provide assistance in promoting water conservation, including but not limited to translation of regulation text and dissemination of water conservation announcements into languages spoken by at least 10 percent of the people who reside in a water supplier’s service area, such as in newspaper advertisements, bill inserts, website homepage, social media, and notices in public libraries.

15. The Board directs staff to consider the following in pursuing any enforcement of section 995, subdivision (b)(1)(A)-(F): before imposing monetary penalties, staff shall provide one or more warnings; monetary penalties must be based on an ability to pay determination, consider allowing a payment plan of at least 12 months, and shall not result in a tax lien; and Board enforcement shall not result in shutoff.

16. The Board encourages entities other than Board staff that consider any enforcement of this regulation to apply these same factors identified in resolved paragraph 15. Nothing in the regulation or in the enforcement provisions of the regulation precludes a local agency from exercising its authority to adopt more stringent conservation measures. Moreover, the Water Code does not impose a mandatory penalty for violations of the regulation adopted by this resolution, and local agencies retain their enforcement discretion in enforcing the regulation, to the extent authorized, and may develop their own progressive enforcement practices to encourage conservation.

THEREFORE BE IT RESOLVED THAT:

1. The State Water Board adopts California Code of Regulations, title 23, section 995, as appended to this resolution as an emergency regulation.

2. State Water Board staff will submit the regulation to the Office of Administrative Law (OAL) for final approval.

3. If, during the approval process, State Water Board staff, the State Water Board, or OAL determines that minor corrections to the language of the regulation or supporting documentation are needed for clarity or consistency, the State Water Board Executive Director or designee may make such changes.
4 4. This regulation shall remain in effect for one year after filing with the Secretary of State unless the State Water Board determines that it is no longer necessary due to changed conditions or unless the State Water Board renews the regulation due to continued drought conditions, as described in Water Code section 1058.5.

5. The State Water Board directs State Water Board staff to work with the Department of Water Resources and the Save Our Water campaign to disseminate information regarding the emergency regulations.

6. Nothing in the regulation or in the enforcement provisions of the regulation precludes a local agency from exercising its authority to adopt more stringent conservation measures. Local agencies are encouraged to develop their own progressive enforcement practices to promote conservation.

CERTIFICATION
The undersigned Clerk to the Board does hereby certify that the foregoing is a full, true, and correct copy of a resolution duly and regularly adopted at a meeting of the State Water Resources Control Board held on January 4, 2022.

AYE: Vice Chair Dorene D’Adamo
Board Member Sean Maguire
Board Member Laurel Firestone
Board Member Nichole Morgan
NAY: None
ABSENT: Chair E. Joaquin Esquivel
ABSTAIN: None
Jeanine Townsend
Clerk to the Board
5 ADOPTED TEXT OF EMERGENCY REGULATION
Title 23. Waters
Division 3. State Water Resources Control Board and Regional Water Quality Control Boards
Chapter 3.5. Urban Water Use Efficiency and Conservation Article 2. Prevention of Drought Wasteful Water Uses
§ 995. Wasteful and Unreasonable Water Uses.
(a) As used in this section:
(1) “Turf” has the same meaning as in section 491.
(2) “Incidental runoff” means unintended amounts (volume) of runoff, such as unintended, minimal overspray from sprinklers that escapes the area of intended use.

Water leaving an intended use area is not considered incidental if it is part of the facility or system design, if it is due to excessive application, if it is due to intentional overflow or application, or if it is due to negligence.
(b)(1) To prevent the unreasonable use of water and to promote water conservation, the use of water is prohibited as identified in this subdivision for the following actions:
(A) The application of potable water to outdoor landscapes in a manner that causes more than incidental runoff such that water flows onto adjacent property, non-irrigated areas, private and public walkways, roadways, parking lots, or structures;
(B) The use of a hose that dispenses water to wash a motor vehicle, except where the hose is fitted with a shut-off nozzle or device attached to it that causes it to cease dispensing water immediately when not in use; (C) The use of potable water for washing sidewalks, driveways, buildings, structures, patios, parking lots, or other hard surfaced areas, except in cases where health and safety are at risk;
(D) The use of potable water for street cleaning or construction site preparation purposes, unless no other method can be used or as needed to protect the health and safety of the public;
(E) The use of potable water for decorative fountains or the filling or topping-off of decorative lakes or ponds, with exceptions for those decorative fountains, lakes, or ponds that use pumps to recirculate water and only require refilling to replace evaporative losses;
(F) The application of water to irrigate turf and ornamental landscapes during and within 48 hours after measurable rainfall of at least one fourth of one inch of rain.

In determining whether measurable rainfall of at least fourth of one inch of rain occurred in a given area, enforcement may be based on records of the National Weather Service, the closest CIMIS station to the parcel, or any other reliable source of rainfall data available to the entity undertaking enforcement of this subdivision; and
(G) The use of potable water for irrigation of ornamental turf on public street medians.
6 (2) Notwithstanding subdivision (b)(1), the use of water is not prohibited by this section to the extent necessary to address an immediate health and safety need. This may include, but is not limited to, the use of potable water in a fountain or water feature when required to be potable because human contact is expected to occur. (c)(1) To prevent the unreasonable use of water and to promote water conservation, any homeowners’ association or community service organization or similar entity is prohibited from:
(A) Taking or threatening to take any action to enforce any provision of the governing documents or architectural or landscaping guidelines or policies of a common interest development where that provision is void or unenforceable under section 4735, subdivisions (a) and (b) of the Civil Code; (B) Imposing or threatening to impose a fine, assessment, or other monetary penalty against any owner of a separate interest for reducing or eliminating the watering of vegetation or lawns during a declared drought emergency, as described in section 4735, subdivision (c) of the Civil Code; or (C) Requiring an owner of a separate interest upon which water-efficient landscaping measures have been installed in response to a declared drought emergency, as described in section 4735, subdivisions (c) and (d) of the Civil Code, to reverse or remove the water-efficient landscaping measures upon the conclusion of the state of emergency.
(2) As used in this subdivision:
(A) “Architectural or landscaping guidelines or policies” includes any formal or informal rules other than the governing documents of a common interest development.
(B) “Homeowners’ association” means an “association” as defined in section 4080 of the Civil Code.
(C) “Common interest development” has the same meaning as in section 4100 of the Civil Code.
(D) “Community service organization or similar entity” has the same meaning as in section 4110 of the Civil Code.
(E) “Governing documents” has the same meaning as in section 4150 of the Civil Code.
(F) “Separate interest” has the same meaning as in section 4185 of the Civil Code.
(3) If a disciplinary proceeding or other proceeding to enforce a rule in violation of subdivision (c)(1) is initiated, each day the proceeding remains pending shall constitute a separate violation of this regulation.
(d) To prevent the unreasonable use of water and to promote water conservation, any city, county, or city and county is prohibited from imposing a fine under any local maintenance ordinance or other relevant ordinance as prohibited by section 8627.7 of the Government Code.
7 (e) The taking of any action prohibited in subdivision (b), (c) or (d) is an infraction punishable by a fine of up to five hundred dollars ($500) for each day in which the violation occurs. The fine for the infraction is in addition to, and does not supersede or limit, any other remedies, civil or criminal.
(f) A decision or order issued under this section by the Board or an officer or employee of the Board is subject to reconsideration under article 2 (commencing with section 1122) of chapter 4 of part 1 of division 2 of the Water Code.

Authority: Section 1058.5, Water Code.

References: Article X, Section 2, California Constitution; Sections 4080, 4100, 4110, 4150, 4185, and 4735, Civil Code; Section 8627.7, Government Code; Sections 102, 104, 105, 275, 350, 491, and 1122, Water Code; Light v. State Water Resources Control Board (2014) 226 Cal.App.4th 1463; Stanford Vina Ranch Irrigation Co. v. State of California (2020) 50 Cal.App.5th 976.

EXECUTIVE DEPARTMENT

STATE OF CALIFORNIA
EXECUTIVE ORDER N-7-22
WHEREAS on April 12, 202 l, May l 0, 2021, July 8, 202 l, and October 19, 2021, I proclaimed states of emergency that continue today and exist across all the counties of California, due to extreme and expanding drought conditions; and
WHEREAS climate change continues to intensify the impacts of droughts on our communities, environment, and economy, and California is in a third consecutive year of dry conditions, resulting in continuing drought in all parts of the State; and
WHEREAS the 21st century to date has been characterized by record warmth and predominantly dry conditions, and the 2021 meteorological summer in California and the rest of the western United States was the hottest on record; and
WHEREAS since my October 19, 2021 Proclamation, early rains in October and December 2021 gave way to the driest January and February in recorded history for the watersheds that provide much of California's water supply; and WHEREAS the ongoing drought will have significant, immediate impacts on communities with vulnerable water supplies, farms that rely on irrigation to grow food and fiber, and fish and wildlife that rely on stream flows and cool water; and
WHEREAS the two largest reservoirs of the Central Valley Project, which supplies water to farms and communities in the Central Valley and the Santa Clara Valley and provides critical cold-water habitat for salmon and other anadromous fish, have water storage levels that are approximately l .1 million acre-feet below last year's low levels on this date; and WHEREAS the record-breaking dry period in January and February and the absence of significant rains in March have required the Department of Water Resources to reduce anticipated deliveries from the State Water Project to 5 percent of requested supplies; and
WHEREAS delivery of water by bottle or truck is necessary to protect human safety and public health in those places where water supplies are disrupted; and
WHEREAS groundwater use accounts for 41 percent of the State's total water supply on an average annual basis but as much as 58 percent in a critically dry year, and approximately 85 percent of public water systems rely on groundwater as their primary supply; and
WHEREAS coordination between local entities that approve permits for new groundwater wells and local groundwater sustainability agencies is important to achieving sustainable levels of groundwater in critically overdrafted basins; and
WHEREAS the duration of the drought, especially following a multiyear drought that abated only five years ago, underscores the need for California to redouble near-, medium-, and long-term efforts to adapt its water management and delivery systems to a changing climate, shifting precipitation patterns, and water scarcity; and
WHEREAS the most consequential, immediate action Californians can take to extend available supplies is to voluntarily reduce their water use by 15 percent from their 2020 levels by implementing the commonsense measures identified in operative paragraph 1 of Executive Order N-10-21 (July 8, 2021 ); and
WHEREAS to protect public health and safety, it is critical the State take certain immediate actions without undue delay to prepare for and mitigate the effects of the drought conditions, and under Government Code section 8571, I find that strict compliance with various statutes and regulations specified in this Proclamation would prevent, hinder, or delay the mitigation of the effects of the drought conditions.

NOW, THEREFORE, I, GAVIN NEWSOM, Governor of the State of California, in accordance with the authority vested in me by the State Constitution and statutes, including the California Emergency Services Act, and in particular, Government Code sections 8567, 8571, and 8627, do hereby issue the following Order to become effective immediately:

IT IS HEREBY ORDERED THAT:

1. The orders and provisions contained in my April 21, 2021, May 10, 2021, July 8, 2021, and October 19, 2021 Proclamations remain in fu ll force and effect, except as modified by those Proclamations and herein.

State agencies shall continue to implement all directions from those Proclamations and accelerate implementation where feasible.

2. To help the State achieve its conservation goals and ensure sufficient water for essential indoor and outdoor use, I call on all Californians to strive to limit summertime water use and to use water more efficiently indoors and out. The statewide Save Our Water conservation campaign at SaveOurWater.com provides simple ways for Californians to reduce water use in their everyday lives. Furthermore, I encourage Californians to understand and track the amount of water they use and measure their progress toward their conservation goals.

3. By May 25, .2022, the State Water Resources Control Board (Water Board) shall consider adopting emergency regulations that include all of the following:
a. A requirement that each urban water supplier, as defined in section 10617 of the Water Code, shall submit to the Department of Water Resources a preliminary annual water supply and demand assessment consistent with section 10632.1 of the Water Code no later than June 1, 2022, and submit a final annual water supply and demand assessment to the Department of Water Resources no later than the deadline set by section 10632.1 of the Water Code;
b. A requirement that each urban water supplier that has submitted a water shortage contingency plan to the
Department of Water Resources implement, at a minimum, the shortage response actions adopted under section 10632 of the Water Code for a shortage level of up to twenty percent (Level 2), by a date to be set by the Water Board; and
c. A requirement that each urban water supplier that has not submitted a water shortage contingency plan to the
Department of Water Resources implement, at a minimum,
shortage response actions established by the Water Board, which shall take into consideration model actions that the Department of Water Resources shall develop for urban water supplier water shortage contingency planning for Level 2, by a date to be set by the Water Board.

To further conserve water and improve drought resiliency if the drought lasts beyond this year, I encourage urban water suppliers to conserve more than required by the emergency regulations described in this paragraph and to voluntarily activate more stringent local requirements based on a shortage level of up to thirty percent (Level 3).

4. To promote water conservation, the Department of Water Resources shall consult with leaders in the commercial, industrial, and institutional sectors to develop strategies for improving water conservation, including direct technical assistance, financial assistance, and other approaches. By May 25, 2022, the Water Board shall consider adopting emergency regulations defining "non-functional turf" (that is, a definition of turf that is ornamental and not otherwise used for human recreation purposes such as school fields, sports fields, and parks) and banning irrigation of non-functional turf in the commercial, industrial, and institutional sectors except as it may be required to ensure the health of trees and other perennial non-turf plantings.

5. In order to maximize the efficient use of water and to preserve water supplies critical to human health and safety and the environment, Public Resources Code, Division 13 (commencing with section 21000) and regulations adopted pursuant to that Division are hereby suspended, with respect to the directives in paragraphs 3 and 4 of this Order and any other projects and activities for the purpose of water conservation to the extent necessary to address the impacts of the drought, and any permits necessary to carry out such projects or activities. Entities that desire to conduct activities under this suspension, other than the directives in paragraphs 3 and 4 of this Order, shall first request that the Secretary of the Natural Resources Agency make a determination that the proposed activities are eligible to be conducted under this suspension. The Secretary shall use sound discretion in applying this Executive Order to ensure that the suspension serves the purpose of accelerating conservation projects that are necessary to address impacts of the drought, while at the same time protecting public health and the environment. The entities implementing these directives or conducting activities under this suspension shall maintain on their websites a list of all activities or approvals for which these provisions are suspended.

6. To support voluntary approaches to improve fish habitat that would require change petitions under Water Code section 1707 and either Water Code sections 1425 through 1432 or Water Code sections 1725 through 1732, and where the primary purpose is to improve conditions for fish, the Water Board shall expeditiously consider petitions that add a fish and wildlife beneficial use or point of diversion and place of storage to improve conditions for anadromous fish. California Code of Regulations, title 23, section 1064, subdivisions ( a) ( 1) (A) (i)-(ii) are suspended with respect to any petition that is subject to this paragraph.

7. To facilitate the hauling of water for domestic use by local communities and domestic water users threatened with the loss of water supply or degraded water quality resulting from drought, any ordinance, regulation, prohibition, policy, or requirement of any kind adopted by a public agency that prohibits the hauling of water out of the water's basin of origin or a public agency's jurisdiction is hereby suspended. The suspension authorized pursuant to this paragraph shall be limited to the hauling of water by truck or bottle to be used for human consumption, cooking, or sanitation in communities or residences threatened with the loss of affordable safe drinking water.

Nothing in this paragraph limits any public health or safety requirement to ensure the safety of hauled water.

8. The Water Board shall expand inspections to determine whether illegal diversions or wasteful or unreasonable use of water are occurring and bring enforcement actions against illegal diverters and those engaging in the wasteful and unreasonable use of water. When access is not granted by a property owner, the Water Board may obtain an inspection warrant pursuant to the procedures set forth in Title 13 (commencing with section 1822.50) of Part 3 of the Code of Civil Procedure for the purposes of conducting an inspection pursuant to this directive.

9. To protect health, safety, and the environment during this drought emergency, a county, city, or other public agency shall not:
a. Approve a permit for a new groundwater well or for alteration of an existing well in a basin subject to the Sustainable
Groundwater Management Act and classified as medium- or high-priority without first obtaining written verification from a Groundwater Sustainability Agency managing the basin or area of the basin where the well is proposed to be located that groundwater extraction by the proposed well would not be inconsistent with any sustainable groundwater management program established in any applicable Groundwater
Sustainability Plan adopted by that Groundwater Sustainability Agency and would not decrease the likelihood of achieving a sustainability goal for the basin covered by such a plan; or b. Issue a permit for a new groundwater well or for alteration of an existing well without first determining that extraction of groundwater from the proposed well is (1) not likely to interfere with the production and functioning of existing nearby wells, and (2) not likely to cause subsidence that would adversely impact or damage nearby infrastructure.

This paragraph shall not apply to permits for wells that will provide less than two acre-feet per year of groundwater for individual domestic users, or that will exclusively provide groundwater to public water supply systems as defined in section 116275 of the Health and Safety Code.

10. To address household or small community drinking water shortages dependent upon groundwater wells that have failed due to drought conditions, the Department of Water Resources shall work with other state agencies to investigate expedited regulatory pathways to modify, repair, or reconstruct failed household or small community or public supply wells, while recognizing the need to ensure the sustainability of such wells as provided for in paragraph 9.

11. State agencies shall collaborate with tribes and federal, regional, and local agencies on actions related to promoting groundwater recharge and increasing storage.

12. To help advance groundwater recharge projects, and to demonstrate the feasibility of projects that can use available high water flows to recharge local groundwater while minimizing flood risks, the Water Board and Regional Water Quality Control Boards shall prioritize water right permits, water quality certifications, waste discharge requirements, and conditional waivers of waste discharge requirements to accelerate approvals for projects that enhance the ability of a local or state agency to capture high precipitation events for local storage or recharge, consistent with water right priorities and protections for fish and wildlife. For the purposes of carrying out this paragraph, Division 13 (commencing with section 21000) of the Public Resources Code and regulations adopted pursuant to that Division, and Chapter 3 ( commencing with section 85225) of Part 3 of Division 35 of the Water Code and regulations adopted pursuant thereto are hereby suspended to the extent necessary to address the impacts of the drought. This suspension applies to (a) any actions taken by state agencies, (b) any actions taken by local agencies where the state agency with primary responsibility for the implementation of the directives concurs that local action is required, and (c) permits necessary to carry out actions under (a) or (b). The entities implementing these directives shall maintain on their websites a list of all activities or approvals for which these provisions are suspended.

13. With respect to recharge projects under either Flood-Managed Aquifer Recharge or the Department of Water Resources Sustainable Groundwater Management Grant Program occurring on open and working lands to replenish and store water in groundwater basins that will help mitigate groundwater conditions impacted by drought, for any (a) actions taken by state agencies, (b) actions taken by a local agency where the Department of Water Resources concurs that local action is required, and (c) permits necessary to carry out actions under (a) or (b), Public Resources Code, Division 13 (commencing with section 21000) and regulations adopted pursuant to that Division are hereby suspended to the extent necessary to address the impacts of the drought. The entities implementing these directives shall maintain on their websites a list of all activities or approvals for which these provisions are suspended.

14. To increase resilience of.state water supplies during prolonged drought conditions, the Department of Water Resources shall prepare for the potential creation and implementation of a multi-year transfer program pilot project for the purpose of acquiring water from willing partners and storing and conveying water to areas of need.

15. By April 15, 2022, state agencies shall submit to the Department of Finance for my consideration proposals to mitigate the worsening effects of severe drought, including emergency assistance to communities and households and others facing water shortages as a result of the drought, facilitation of groundwater recharge and wastewater recycling, improvements in water use efficiency, protection of fish and wildlife, mitigation of drought-related economic or water-supply disruption, and other potential investments to support short- and long-term drought response.

IT IS FURTHER ORDERED that as soon as hereafter possible, this Order be filed in the Office of the Secretary of State and that widespread publicity and notice be given of this Order.

This Order is not intended to, and does not, create any rights or benefits, substantive or procedural, enforceable at law or in equity, against the State of California, its agencies, departments, entities, officers, employees, or any other person.

IN WITNESS WHEREOF I have hereunto set
my hand and caused the Great Seal of the
State of California to be affixed this 28th
day of March 2022.

I I
,:, .
l · I'
t (.1 I
l~~-~-- GAVIN NEWSOM
Governor of California
ATTEST:

SHIRLEY N. WEBER, PH.D.

Secretary of State
State of California
Office of Administrative Law
In re:

State Water Resources Control Board

NOTICE OF APPROVAL OF EMERGENCY

REGULATORY ACTION
Regulatory Action:

Title 23, California Code of Regulations
Adopt sections: 996
Amend sections:

Repeal sections:

Government Code Sections 11346.1 and
11349.6
OAL Matter Number: 2022-0606-03
OAS Makter Type: Emergency (E)
This emergency action by the State Water Resources Control Board adopts a new regulation which .requires urban water suppliers to submit preliminary supply and demand assessments to the Department of Water Resources and to implement Level 2 demand reduction actions (actions intended to result in a 10 to 20 percent savings).

The regulation bans the irrigation of non-functional turf with potable water in commercial, industrial, and institutional. sectors and establishes that such irrigation is an infraction punishable by a fine of up to five hundred dollars for each day in which. the violation occurs pursuant to Water Code section 1058.5(d).

OAL approves this emergency regulatory action pursuant to sections 11346.1 and 11349.6 of the Government Gode. Pursuant to Water Code section 1058.5(b}, the Finding of Emergency in this matter was exempt from Office of Administrative Law Review.

This emergency regulatory action is effective on 6/10/2022 and, pursuant to Water Cade section 1058.5(c), will expire on 6/1 Q/2023. The Certificate of Compliance far this action is due no later than 6/9/2023.

Date: June 10, 2022 ~ ~~„~, ~~-,
Dale Mentink`
Assistant Chief Counsel
For: Kenneth J. Pogue
Director
Original: Eileen Sobeck, Executive
Director
Copy: Garrett Lenahan
STATE OF CALIFORNIA—OPfICEOFADMINiSTRA E~nw
NOTICE PUBLIC/~TIOIV For use by Secretary of State only ~n,
sr~.aootRev.ionor9l ~
~f1L FILE N07ICE FILE NUMBER REGULATORY ACTION NUMBEgR~ g~ ~g EMER~GEi NyC~Y NUMBER N1Jt~/I$~f~'a" ~~ e~
For use by Once of Administrative law (OAL)
~X ~ ~d ~ S7 ll ~ '~ ~ r ,~ ~ ~~~li~ ~~i" °• _ «<-~ only ~,'.;?~ bffi~e c u ~ ~.e~ ,'~;1 ~,° ~;,;. _ ~(fhv S~.~ of ~~~nmi~
~~~~ s~,~, jm~ rti r ~a-s~

NOTICE REGULATIONS

AGENCY WITH RULEMAKING AUTHORITY
State Water AGENCY FILE NUMBER (if any) Resources Control Board A. PUBLICATION OF NOTICE (Complete for publication in Notice Register)

1. SUBJECT OF NOTICE TITLES) FIRST SECTION AFFECTED 2. REQUESTED PUBLICATION DATE

3. NOTICE TYPE - 4. AGENCY CONTACT PERSON TELEPHONE NUMBER FAX NUMBER (Optional) ❑ Notice re Proposed ("—►
Re ulato tither `Action L_~
OAL USE ACTION ON PRppgSFD NOTICE
~~~Y HPP~oveaas
NOTICE. R_FGISTER NUMBER '. Pl!BUCATlpN bATE APp~cvyas t" DisapProvh~+~ S~bnnroea ~ MorliheU ~ Witharawn B. SUBMISSION OF REGULATIONS (Complete when submitting regulations) 1a. SUBJECT OF REGULATION{S) ib. ALL PREVIOUS RELATED OAL REGULATORY ACTION NUMBERS) Water Demand Reduction Emergency Regulation

2. SPECIFY CALIFORNIA CODE Of REGULATIONS TITLES) AND SECTIONS) (including title 26, if toxics related) SECTIONS} AFFECTED A°oPT
{List all section number{s) 996
`individually. Attach aMeNo
_~cidi~a~al:_sF~eeh_6f~reeded.} __~_._ _--- ____ _._ ----_ ____ -- TITLE(S) REPEAL 23 3. TYPE OF FILING
Code
Regular
§11346)
Rulemaking {Gov. ❑Certificate of Compliance: The agency officer named ~ Emergency Readopt ~ Changes Without below certifies that this agency complied with the (Gov. Code, §11346.1 (h}) Regulatory Effect {CaL Resubmittal of disapproved provisions of Gov. Code §§11346.2-11347.3 either Code Regs., title 1, §100} or withdrawn nonemergency before the emergency regulation was adopted or filing (Gov. Code §§11349.3, within the time period required by statute. 11349.4) ❑File &Print ~ Print Oniy
§11346.1(b))
Emergency (Gov. Code, ~
emergency
Resubmittal
filing
of disapproved
(Gov. Code,
or
§11346.1)
withdrawn o ocher {sPe~~~> Wafer Code Section 1058.5

4. ALL BEGINNING AND ENDING DATES OF AVAILABILITY OF MODIFIED REGULATIONS AND/OR MATERIAL ADDED TO THE RULEMAKING FILE (Cal. Code Regs. line 1, §44 and Gov. Code §11347.1)

5. EFFECTIVE DATE OF CHANGES (Gov. Code, §§ 11343.4, 11346.1(d}; Cai. Code Regs., title 1, §100 ) Effective January 1, April 1, July 1, or x Effective on filing with §100 Changes Without Effective other October 1 (Gov. Code §11343.4(a)) ❑Secretary of State ❑Regulatory Effect ❑(Specify)

6. CHECK IF THESE REGULATIONS REQUIRE NOTICE T0, OR REVIEW, CONSULTATION, APPROVAL OR CONCURRENCE BY, ANOTHER AGENCY OR ENTITY Department of Fnance (Form STD. 399) {SAM §6660) ~ Fair Political Practices Commission ~ State Fire Marshal Other {Specify)

7. CONTACT PERSON TELEPHONE NUMBER FAX NUMBER {Optional) E-MAIL ADdRESS (Optional) Garrett Lenahan 916 341-5179

8. (certify
of the regulation{s)
that the attached
identified
copy
on
of the regulations) is a true and correct copy For use by Office of Administrative Law (OAL) only this form, that the information specified on this form is true and correct, and #hat I am the head of the agency taking this action, or a designee of the head of the agency, and am authori2ed to make this certification.

SIGNATURE OF AGENCY HEAD OR DESIGNEE PATE
Eric Oppenheimer °'g J.~te:20]IA6➢614:24:44 7a1ySgnedbyEncOp°~ibe -0]'00'1nef 6/612022

TYPED NAME AND TITLE OF SIGNATORY
Eric Oppenheimer, Chief Deputy Director, State Water Resources Control Board

ADOPTED EMERGENCY REGULATION TEXT
Title 23. Waters
Division 3. State Water Resources Control Board and Regional Water Quality Control Boards
Chapter 3.5. Urban Water Use Efficiency and Conservation Article. 2. Prevention of Drought Wasteful Water Uses
996. Urban Drought Response Actions
~a) As used in this section:
(1) "Commercial, industrial and institutionaP' refers to commercial water users, industrial water users, and .institutional water users as respectively defined in Water Code, section 10608:12. subdivisions (e), {i ,and (j), and includes homeowners' associations, common interest developments, community service organizations, and other similar entities but does not include the residences of these entities' members or separate interests. ~2) "Common interest development' has the same meaning as in section 4100 of the Civil Code.
~3) "Community service organization or similar entity" has the same meaning as in :section 4110 of the Civi( Code.
~4) "Homeowners' association" means an "association" as defined in section 4080 of the Civil Code.
(5} "Non-functional turf" means turf that is solely ornamental and not rec~ularly used for human recreational purposes or for civic or community events. Non-functional turf does not include sports fields and turF that is regularly used for human recreational purposes or for civic or community events.
(6} "Plant factor" has the same meaninct as in section 491. ~7) "Separate interest" has the same meaning as in section 4185 of the Civil Code. (8) "Turf" has the same meaning as in section 491.
(9} "Urban water supplier" has the same meaning as Water Code section 10617. (10) "Water shortage contingenc rLplan" means the plan required by Water Cade section 10632.
(b) Each urban water supplier shall submit to the Department of Water Resources a preliminary annual water su~ply and demand assessment consistent with section 10632.1 of the Water Cade no later than June 1 2022 or the effective date of this section whichever comes later, and submit a final annual water supply and demand assessment to the Department of Water Resources no later than the deadline set by section 10632.1 of the Water Code.
(i) The supplier's annual water supply and demand assessment submitted to the Department of Water`Resources demonstrates an ability to maintain reliable suppix until September 30, 2023.

Department of Water Resources.
(iii) The supplier's average number of gallons of water used per person per day by to twenty (20) gercent (Level ~, implement at a minimum the following actions:
(1) Initiate a public information and outreach campaign for water conservation and promptly and effectively reach the supplier's customers, using efforts such as ema papermail, bill inserts, customer app notifications, news articles, websites, comma events radio and television billboards and social media. potable water befinreen the hours of 10:00 a.m. and 6:00 p.m.

Level 2~
(2 Notwithstanding subdivision (c)(1), urban water suppliers shall not be required to implement new residential connection moratoria pursuant to this section. residential customers for the year 2020 is below 55 gallons, as reported to the Board in the :Electronic Annual Report.
has authority to enforce, as infractions, the prohibitions in section 995 and takes enforcement against violations.
(e) t1) To prevent the unreasonable use of water and to promote water conservation, the use: of potable water is prohibited for the irrigation of non-functional turf at commercial, industrial and institutional sites.
(2~ Notwithstanding subdivision (e)(1~, the use of water is not prohibited by this section to the extent necessary to ensure the health of trees and other perennial non-turf plantings or to the extent necessary to address an immediate health and safety need. (3) Notwithstanding subdivision (e)(1 ~, an urban water supplier may approve a request for continued irrigation of non-functional turFwhere the user certifies that the turf is a low water use plant with a plant factor of 0.3 or less, and demonstrates the actual use is less than 40% of reference evapotranspiration.
criminal
(g) A decision or order issued under this section ~ the Board, or an officer or employee the Board, is subject to reconsideration under article 2 (commencing with section 1122) c chapter 4 of part 1 of division 2 of the Water Code.

Authority: Section 105$.5, Water Code.

References: Article X Section 2 California Constitution' Sections 4080 4100 4110 and 4185 Civil Gode~ Section 8627.7 Government Code' Sections 102 104 105 275 350

3.77, 491, 1058.5, 1122. 10608.12, 10617, 10632, and 10632.1, Water Code; Lic~hf v. Sf~ Water Resources Control Board (2Q14) 226 Cal.App.4th 1463; Stanford Vina Ranch lrrigation Co. v. State of California (20201 50 Cal.App.5th 976

EXECUTIVE DEPARTMENT

STATE OF CALIFORNIA
EXECUTIVE ORDER N-5-23
WHEREAS on April 21, 2021, May 10, 2021, July 8, 2021, and October 19, 2021, I proclaimed States of Emergency to exist due to drought conditions; and WHEREAS the multi-year nature of the current drought, which began three years after the record-setting drought of 2012-2016, continues to have significant, immediate impacts on communities across California with vulnerable water supplies, farms that rely on irrigation to grow food and fiber, and fish and wildlife that rely on stream flows and cool water; and
WHEREAS the March 3, 2023, snow survey conducted by the Department of Water Resources and partner agencies found that most regions of the Sierra Nevada are above average for snow water content, and some regions are nearing record amounts of snow, and snow and rain has fallen across many regions of the state since then, with more precipitation forecasted; and WHEREAS improved conditions have helped rehabilitate surface water supplies, but have not abated the severe drought conditions that remain in some parts of the State, including the Klamath River basin and the Colorado River basin, and many groundwater basins throughout the State remain depleted from overreliance and successive multi-year droughts; and WHEREAS continued action by the State is needed to address ongoing consequences of the drought emergency, including groundwater supply shortages, domestic well failures, and drought-related harm to native fishes in the Klamath River and Clear Lake watersheds; and
WHEREAS the drought emergency has required a dynamic and flexible response from the State, and several provisions in my prior Proclamations and Orders have been terminated or superseded already, specifically Paragraphs 4 and 8 of my State of Emergency Proclamation dated April 21, 202 l, Paragraphs 2, 4, and 7 of my State of Emergency Proclamation dated May 10, 2021, Paragraphs 3, 4, 5, 6, and 10 of my State of Emergency Proclamation dated July 8, 2021, and Paragraph 9 of Executive Order N-7-22; and WHEREAS improved conditions warrant an even more targeted State response to the ongoing drought emergency and certain provisions in my State of Emergency Proclamations dated April 21, 202 l, May 10, 2021, July 8, 2021, and October 19, 2021, and in Executive Orders N-10-21, N-7-22, and N-3-23 provide authority that is no longer needed to mitigate the effects of the drought conditions or direct actions by state agencies, departments, and boards that have already been completed; and
WHEREAS notwithstanding the rescission of certain emergency authorities for emergency drinking water action, state agencies have existing legal authority and funding to continue expedited work to advance the human right to water, and state agencies will continue all ongoing drought resilience planning work, including through coordination with local agencies and tribes; and
WHEREAS next winter's hydrology is uncertain and the most efficient way to preserve the State's improved surface water supplies is for Californians to continue their ongoing efforts to make conservation a way of life; and WHEREAS to protect public health and safety, it is critical the State take certain immediate actions without undue delay to prepare for and mitigate the effects of the drought conditions, and under Government Code section 8571, I find that strict compliance with various statutes and regulations specified in this Order would prevent, hinder, or delay the mitigation of the effects of the drought conditions.

NOW, THEREFORE, I, GAVIN NEWSOM, Governor of the State of California, in accordance with the authority vested in me by the State Constitution and statutes, including the California Emergency Services Act, and in particular, Government Code sections 8567, 8571, and 8627, do hereby issue the following Order to become effective immediately:

IT IS HEREBY ORDERED THAT:
l . The orders and provisions contained in my State of Emergency Proclamations dated April 21, 2021, May 10, 2021, July 8, 2021, and October 19, 2021, and Executive Orders N-7-22 (March 28, 2022), N-3- 23 (February 13, 2023), and N-4-23 (March l 0, 2023), remain in full force and effect, except as modified by those Proclamations and Orders and herein. State agencies shall continue to implement all directions from those Proclamations and Orders and accelerate implementation where feasible.

2. The following provisions of my State of Emergency Proclamation dated April 21, 2021, are terminated:
a. Paragraph 2;
b. Paragraphs 5-7; and
c. Paragraphs 9-14.

3. The following provisions of my State of Emergency Proclamation dated May l 0, 2021, are terminated:
a. Paragraph 1;
b. Paragraph 3;
c. Paragraph 5; and
d. Paragraphs 9-10.

4. The following provisions of my State of Emergency Proclamation dated July 8, 2021, are terminated:
a. Paragraph 2;
b. Paragraphs 7-8, except those portions of paragraph 7 withdrawing provisions of prior orders;
c. Paragraphs 11-12.

5. The following provisions of my State of Emergency Proclamation dated October 19, 2021, are terminated:
a. Paragraph 2;
b. Paragraphs 4-5;
c. Paragraph 8; and
d. Paragraph 10.

6. The following provisions of Executive Order N-10-21 are terminated:
a. Paragraph 1; and
b. Paragraph 3

7. The following provisions of Executive Order N-7-22 are terminated:
a. Paragraphs 1-3;
b. Paragraph 6; and
c. Paragraphs 14-15.

8. The following provisions of Executive Order N-3-23 are terminated:
a. Paragraph 1; and
b. Paragraph 3, except those portions of the paragraph
withdrawing provisions of prior orders.

9. Paragraph 6 of my State of Emergency Proclamation dated May 10, 2021, and Paragraph 9 of my State of Emergency Proclamation dated July 8, 2021, are withdrawn and replaced with the following text:

To ensure critical instream flows for species protection in the Klamath River and Clear Lake watersheds, the State Water Resources Control Board (Water Board) and Department of Fish and Wildlife shall evaluate the minimum instream flows and other actions needed to protect salmon, steelhead, the Clear Lake Hitch, and other native fishes in critical streams systems in these watersheds and work with water users, tribes, and other parties on voluntary measures to implement those actions. To the extent voluntary actions are not sufficient, the Water Board, in coordination with the Department of Fish and Wildlife, shall consider emergency regulations to establish minimum instream flows to mitigate the effects of the drought conditions. For purposes of state agencies carrying out or approving any actions contemplated by this paragraph, Public Resources Code, Division 13 (commencing with Section 21000) and regulations adopted pursuant to that Division are suspended. Nothing in this Paragraph affects or limits the validity of actions already taken in the Klamath and Clear Lake watersheds or ongoing under Paragraph 6 of my State of Emergency Proclamation dated May 10, 2021, or Paragraph 9 of my State of Emergency Proclamation dated July 8, 2021 .

IT IS FURTHER ORDERED that as soon as hereafter possible, this Order be filed in the Office of the Secretary of State and that widespread publicity and notice be given of this Order.

This Order is not intended to, and does not, create any rights or benefits, substantive or procedural, enforceable at law or in equity, against the State of California, its agencies, departments, entities, officers, employees, or any other person.

IN WITNESS WHEREOF I have hereunto set
my hand and caused the Great Seal of the
State of California to be affixed this 24th
day of March 2023.
overnor of California
ATTEST:

SHIRLEY N. WEBER, PH.D.

Secretary of State

DRINKING WATER CONSTRUCTION
LOAN
AGREEMENT NO. SWRCB0000000000D2002017
by and between
CITY OF PORTERVILLE (“Recipient”)
and
CALIFORNIA STATE WATER RESOURCES CONTROL BOARD (“State Water Board”) for the purpose of the

AKIN/CENTRAL WATER CONSOLIDATION PROJECT
5410010-018C AND 5400655-001C (“Project”)
• Section 116760 et seq. of the Health and Safety Code and Resolution Nos. 2019-0065 and 2020- 0022.

PROJECT FUNDING AMOUNT: $4,787,664
PRINCIPAL FORGIVENESS COMPONENT: $4,787,664
ESTIMATED REASONABLE PROJECT COST: $4,787,664
ELIGIBLE WORK START DATE: JULY 1, 2016
ELIGIBLE CONSTRUCTION START DATE: SEPTEMBER 22, 2020
CONSTRUCTION COMPLETION DATE: OCTOBER 1, 2023
FINAL REIMBURSEMENT REQUEST DATE: APRIL 1, 2024
RECORDS RETENTION END DATE: OCTOBER 1, 2059
City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

3pg18xi20

1. The State Water Board and the Recipient mutually promise, covenant, and agree to the terms, provisions, and conditions of this Agreement, including the following Exhibits, which are attached hereto or are incorporated by reference:
• Exhibit A – Scope of Work and Schedule
• Exhibit B – Specific Funding Provisions
• Exhibit C – GENERAL TERMS AND CONDITIONS 2019-NOV
• Exhibit D – Special Conditions

2. The following documents are also incorporated by reference:
• the Drinking Water System Permit No. 03-12-06P-004;
• the Davis-Bacon requirements found at:
https://www.waterboards.ca.gov/water_issues/programs/grants_loans/srf/docs/davisbacon/2020_ dwsrf_governmental_entities.pdf

3. Party Contacts during the term of this Agreement are:

State Water Board City of Porterville
Section: Division of Financial Assistance
Name: Pete Stamas, Project Manager Name: Monte Reyes, Mayor Address: 1001 I Street, 16th Floor Address: 291 North Main Street City, State,
Zip:

Sacramento, CA 95814 City, State, Zip: Porterville, CA 93257 Phone: (916) 552-9983 Phone: (559) 782-7499
Fax: Fax:

Email: [email protected] Email: [email protected] Each party may change its contact upon written notice to the other party. While Party Contacts are contacts for day-to-day communications regarding Project work, the Recipient must provide official communications and notices to the Division’s Deputy Director.

4. Conditions precedent to this Agreement are set forth as follows:
(a) The Recipient must deliver an opinion of general counsel satisfactory to the State Water Board’s counsel dated on or after the date that the Recipient signs this Agreement. (b) The Recipient must deliver to the Division a resolution authorizing this Agreement and identifying its authorized representative by title.
(c) The Recipient must deliver to the Division a resolution certifying that its decision-making body reviewed and considered the Mitigated Negative Declaration filed by the State Water Board for the Akin Water Company Water Supply Project together with the Mitigation Monitoring and Reporting Program and reached its own conclusions on whether and how to approve the Project, pursuant to Section 15050 (b) of the CEQA Guidelines.

5. The Recipient represents, warrants, and commits to the following as of the Eligible Work Start Date and continuing thereafter for the term of this Agreement, which shall be at least until the Records Retention End Date:
(a) The Recipient agrees to comply with all terms, provisions, conditions, and commitments of this Agreement, including all incorporated documents.
(b) The execution and delivery of this Agreement, including all incorporated documents, has been duly authorized by the Recipient. Upon execution by both parties, this Agreement constitutes a valid and binding obligation of the Recipient, enforceable in accordance with its terms, except as such enforcement may be limited by law.

City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

3pg18xi20
(c) None of the transactions contemplated by this Agreement will be or have been made with an actual intent to hinder, delay, or defraud any present or future creditors of Recipient. The Recipient is solvent and will not be rendered insolvent by the transactions contemplated by this Agreement. The Recipient is able to pay its debts as they become due. The Recipient maintains sufficient insurance coverage considering the scope of this Agreement, including, for example but not necessarily limited to, general liability, automobile liability, workers compensation and employer liability, professional liability. (d) The Recipient is in compliance with all State Water Board funding agreements to which it is a party.

City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit A
EXHIBIT A – SCOPE OF WORK AND SCHEDULE
A.1. PROJECT PURPOSE AND DESCRIPTION.

The Project is for the benefit of the Recipient and has a Useful Life of at least 40 years. The funding under this Agreement shall be used to provide the residents of two small disadvantaged communities currently served by Akin Water Company (Akin WC) and Central Mutual Water Company (Central MWC) with a sustainable source of safe drinking water.

A.2. SCOPE OF WORK.

The Recipient agrees to do the following: consolidate with Akin WC and Central MWC. Recipient also agrees to construct a new production well, estimated to produce between 1,300 and 1,800 gallons per minute, to provide the needed source capacity for the consolidation of Akin WC, the consolidation of Central MWC, as well as satisfy the remainder of East Porterville residents’ capacity needs.

The Recipient agrees to do the following for the Akin WC service area: construct approximately 1,500 feet of 8-inch waterline to provide water service to each customer currently served by Akin WC; install approximately three new fire hydrants and twenty-six new service laterals and meters; and destroy Akin WC’s two existing wells.

The Recipient agrees to do the following for the Central MWC service area: construct approximately 1,400 feet of 6-inch waterline to provide water service to each customer currently served by Central MWC; install approximately four new fire hydrants and thirty-four new service laterals and meters; and destroy Central MWC’s existing well.

Upon Completion of Construction, the Recipient must expeditiously initiate Project operations.

A.3 SIGNAGE
The Recipient must place a professionally prepared sign at least four feet tall by eight feet wide made of ¾ inch thick exterior grade plywood or other approved material in a prominent location on the Project site and must maintain the sign in good condition for the duration of Project implementation. The sign may include another agency’s required information and must include, prominently displayed, the following disclosure statement and color logos (available from the Division):

“Funding for this project has been provided in full or in part under the Drinking Water State Revolving Fund, which may include capitalization funding from the United States Environmental Protection Agency through an agreement with the State Water Resources Control Board.” A.4 SCHEDULE.

Failure to provide items by the due dates indicated in the table below may constitute a material violation of this Agreement. The Project Manager may adjust the dates in the “Estimated Due Date” column of this table, but Critical Due Date adjustments will require an amendment to this Agreement. The Recipient City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit A
must complete and submit all work in time to be approved by the Division prior to the Project Completion Date. As applicable for specific submittals, the Recipient must plan adequate time to solicit, receive, and address comments prior to submitting the final submittal. The Recipient must submit the final Reimbursement Request prior to the Final Reimbursement Request Date set forth on the Cover Page.

ITEM DESCRIPTION OF SUBMITTAL CRITICAL DUE
DATE

ESTIMATED DUE
DATE
EXHIBIT A – SCOPE OF WORK
A. ADDITIONAL SUBMITTAL(S) TO DIVISION

1. Final Plans and Specifications September 1, 2021

2. Final Budget Approval Package February 1, 2022

3. Completion of Construction October 1, 2023
B. REPORTS

1. Progress Reports Quarterly

2. Final Inspection and Certification October 1, 2023

3. Project Completion Report December 1, 2023
4 As Needed Reports TBD
EXHIBIT B – REIMBURSEMENTS, BUDGET DETAIL, AND REPORTING PROVISIONS A. REIMBURSEMENTS

1. Reimbursement Requests Quarterly

2. Final Reimbursement Request April 1, 2024
The Recipient must award the prime construction contract and begin construction timely. The Recipient must deliver any request for extension of the Completion of Construction Date no less than 90 days prior to the Completion of Construction Date.

A.5 PROGRESS REPORTS.

The Recipient must provide a progress report to the Division each quarter, beginning no later than 90 days after execution of this Agreement. The Recipient must provide a progress report with each Reimbursement Request. Failure to provide a complete and accurate progress report may result in the withholding of Project Funds, as set forth in Exhibit B. A progress report must contain the following information:
1) A summary of progress to date including a description of progress since the last report, percent construction complete, percent contractor invoiced, and percent schedule elapsed;
2) A description of compliance with environmental requirements; 3) A listing of change orders including amount, description of work, and change in contract amount and schedule; and
4) Any problems encountered, proposed resolution, schedule for resolution, and status of previous problem resolutions.

City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit A
A.6 SPECIAL REPORTS.
(a) The Recipient must submit a Project Completion Report to the Division with a copy to the appropriate District Office on or before the due date established by the Division and the Recipient at the time of final project inspection. The Project Completion Report must include the following:
i. Description of the Project,
ii. Description of the water quality problem the Project sought to address, iii. Discussion of the Project’s likelihood of successfully addressing that water quality problem in the future, and
iv. Summary of compliance with applicable environmental conditions. (b) If the Recipient fails to submit a timely Project Completion Report, the State Water Board may stop processing pending or future applications for new financial assistance, withhold reimbursements under this Agreement or other agreements, and begin administrative proceedings.
(c) The Recipient must report Disadvantaged Business Enterprise (DBE) utilization to the Division on the DBE Utilization Report, State Water Board Form DBE UR334. The Recipient must submit such reports to the Division annually within ten (10) calendar days following October 1 until such time as the "Notice of Completion" is issued. The Recipient must comply with 40 CFR § 33.301 and require its contractors and subcontractors on the Project to comply.

A.7 FINAL PROJECT INSPECTION AND CERTIFICATION.

Upon completion of the Project, the Recipient must provide for a final inspection and must certify that the Project has been completed in accordance with this Agreement, any final plans and specifications submitted to the State Water Board, and any amendments or modifications thereto. If the Project involves the planning, investigation, evaluation, design, or other work requiring interpretation and proper application of engineering, or other professionals, the final inspection and certification must be conducted by a California Registered Civil Engineer or other appropriate California registered professional. The results of the final inspection and certification must be submitted to the Project Manager.

City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit B
EXHIBIT B – FUNDING AMOUNTS
B.1 ESTIMATED REASONABLE COST AND PROJECT FUNDS.

The estimated reasonable cost of the total Project is set forth on the Cover Page of this Agreement and is greater than or equal to the funding anticipated to be provided by the State Water Board under this Agreement. Subject to the terms of this Agreement, the State Water Board agrees to provide Project Funds not to exceed the amount of the Project Funding Amount set forth on the Cover Page of this Agreement.

B.2 RECIPIENT CONTRIBUTIONS.
(a) The loan component of this Agreement is forgiven. The estimated amount of principal that will be due to the State Water Board from the Recipient under this Agreement is Zero dollars and no cents ($0.00). (b) The Recipient must pay any and all costs connected with the Project including, without limitation, any and all Project Costs. If the Project Funds are not sufficient to pay the Project Costs in full, the Recipient must nonetheless complete the Project and pay that portion of the Project Costs in excess of available Project Funds, and shall not be entitled to any reimbursement therefor from the State Water Board. (c) If the Recipient recovers funds from any responsible parties, the Recipient shall immediately notify the Division. The amount of this Agreement may be reduced to reflect the recovered funds.

B.3 VERIFIABLE DATA.

Upon request by the Division, the Recipient must submit verifiable data to support deliverables specified in the Scope of Work. The Recipient’s failure to comply with this requirement may be construed as a material breach of this Agreement.

B.4 BUDGET COSTS
Budget costs are contained in the Summary Project Cost Table below:

LINE ITEM TOTAL ESTIMATED COST PROJECT FUNDING AMOUNT
Construction $3,194,720 $3,194,720
Pre-Purchased Material/Equipment $0 $0
Purchase of Land $0 $0
Contingency $638,944 $638,944
Allowances (Soft Costs) $954,000 $954,000
TOTAL $4,787,664 $4,787,664

The Division’s Final Budget Approval and related Form 259 and Form 260 will document a more detailed budget of eligible Project Costs and Project funding amounts.

The Recipient is prohibited from requesting disbursement amounts that represent Recipient’s mark-ups to costs invoiced or otherwise requested by consultants or contractors.

Reasonable indirect costs may be allowable upon approval by the Division.

B.5 LINE ITEM ADJUSTMENTS.

Upon written request by the Recipient, the Division may adjust the line items of the Summary Project Cost Table at the time of Division’s Final Budget Approval. Upon written request by the Recipient, the Division may also adjust the line items of the Summary Project Cost Table as well as the detailed budget at the time of Recipient’s submittal of its final claim. Any line item adjustments to the Summary Project Cost Table that are due to a change in scope of work will require an Agreement amendment. The sum of adjusted line items in both the Summary City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit B
Project Cost Table and the detailed budget must not exceed the Project Funding Amount. The Division may also propose budget adjustments.

Under no circumstances may the sum of line items in the budget approved through the Final Budget Approval process exceed the Project Funding Amount. Any increase in the Project Funding Amount will require an Agreement amendment.

B.6 REIMBURSEMENT PROCEDURE.
(a) Except as may be otherwise provided in this Agreement, reimbursements will be made as follows:

1. Upon execution and delivery of this Agreement by both parties, the Recipient may request immediate reimbursement of any eligible incurred costs as specified below through submission to the State Water Board of the Reimbursement Request Form 260 and Form 261, or any amendment thereto, duly completed and executed.

2. The Recipient must submit a Reimbursement Request for costs incurred prior to the date this Agreement is executed by the State Water Board no later than ninety (90) days after this Agreement is executed by the State Water Board. Late Reimbursement Requests may not be honored.

3. Additional Project Funds will be promptly disbursed to the Recipient upon receipt of Reimbursement Request Form 260 and Form 261, or any amendment thereto, duly completed and executed by the Recipient for incurred costs consistent with this Agreement, along with receipt of progress reports due under Exhibit A.

4. The Recipient must not request reimbursement for any Project Cost until such cost has been incurred and is currently due and payable by the Recipient, although the actual payment of such cost by the Recipient is not required as a condition of reimbursement. Supporting documentation (e.g., receipts) must be submitted with each Reimbursement Request. The amount requested for Recipient’s administration costs must include a calculation formula (i.e., hours or days worked times the hourly or daily rate = total amount claimed). Reimbursement of Project Funds will be made only after receipt of a complete, adequately supported, properly documented, and accurately addressed Reimbursement Request. Upon request by the Division, supporting documents for professional and administrative services must include the employees’ names, classifications, labor rates, hours worked, and descriptions of the tasks performed.

Reimbursement Requests submitted without supporting documents may be wholly or partially withheld at the discretion of the Division.

5. The Recipient must spend Project Funds within 30 days of receipt. If the Recipient earns interest earned on Project Funds, it must report that interest immediately to the State Water Board. The State Water Board may deduct earned interest from future reimbursements.

6. The Recipient shall not request a reimbursement unless that Project Cost is allowable, reasonable, and allocable.

7. Notwithstanding any other provision of this Agreement, no reimbursement shall be required at any time or in any manner which is in violation of or in conflict with federal or state laws, policies, or regulations. (b) Notwithstanding any other provision of this Agreement, the Recipient agrees that the State Water Board may retain an amount equal to ten percent (10%) of the Project Funding Amount until Project Completion. Any retained amounts due to the Recipient will be promptly disbursed to the Recipient, without interest, upon Project Completion.
(c) Except as follows, construction costs and disbursements are not available until after the Division has approved the final budget form submitted by the Recipient. The Deputy Director of the Division may authorize the disbursement of up to ten percent (10%) of Project Funds for the reimbursement of eligible construction costs and pre-purchased materials prior to Division approval of the final budget form submitted by the Recipient. All other construction costs are not eligible for reimbursement until after this the Division has approved the final budget form submitted by the Recipient. Construction costs incurred prior to the Eligible Construction Start Date are not eligible for reimbursement.

B.7 REVERTING FUNDS AND DISENCUMBRANCE.

City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit B
In the event the Recipient does not submit Reimbursement Requests for all funds encumbered under this Agreement by the Final Reimbursement Request Date, any remaining funds revert to the State. The State Water Board may notify the Recipient that the project file is closed, and any remaining balance will be disencumbered and unavailable for further use under the Agreement.

City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit C
EXHIBIT C – GENERAL TERMS AND CONDITIONS 2019-NOV
GENERAL TERMS AND CONDITIONS 2019-NOV is incorporated by reference and is posted at https://www.waterboards.ca.gov/water_issues/programs/grants_loans/general_terms.html City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit D
EXHIBIT D – SPECIAL CONDITIONS

1. Notwithstanding Exhibit C, the following terms have no meaning for the purposes of this Agreement:
• Work Completion
• Work Completion Date

2. Each capitalized term used in this Agreement has the following meaning:
• "Allowance" means an amount based on a percentage of the accepted bid for an eligible project to help defray the planning, design, and construction engineering and administration costs of the Project. • "Authorized Representative" means the duly appointed representative of the Recipient as set forth in the certified original of the Recipient’s authorizing resolution that designates the authorized representative by title.
• "Completion of Construction" means the date, as determined by the Division after consultation with the Recipient, that the work of building and erection of the Project is substantially complete, and is established on the Cover Page of this Agreement.
• “District Office” means District Office of the Division of Drinking Water of the State Water Board. • “Division of Drinking Water” means the Division of Drinking Water of the State Water Board. • “Eligible Construction Start Date” means the date set forth on the Cover Page of this Agreement, establishing the date on or after which construction costs may be incurred and eligible for reimbursement hereunder.
• “Eligible Work Start Date” means the date set forth on the Cover Page of this Agreement, establishing the date on or after which any non-construction costs may be incurred and eligible for reimbursement hereunder.
• “Enterprise Fund” means the enterprise fund of the Recipient in which Revenues are deposited. • “Event of Default” means, in addition to the meanings set forth in Exhibit C, the occurrence of any of the following events:
a) A material adverse change in the condition of the Recipient, the Revenues, or the System, which the Division reasonably determines would materially impair the Recipient’s ability to satisfy its obligations under this Agreement.
b) Failure to operate the System or the Project without the Division’s approval; • “Final Budget Approval” means the Division-approved final budget for the Project, as set forth in Exhibit B. • “Indirect Costs” means those costs that are incurred for a common or joint purpose benefiting more than one cost objective and are not readily assignable to the Project (i.e., costs that are not directly related to the Project). Examples of Indirect Costs include, but are not limited to: central service costs; general administration of the Recipient; non-project-specific accounting and personnel services performed within the Recipient organization; depreciation or use allowances on buildings and equipment; the costs of operating and maintaining non-project-specific facilities; tuition and conference fees; generic overhead or markup; and taxes.
• "Initiation of Construction" means the date that notice to proceed with work is issued for the Project, or, if notice to proceed is not required, the date of commencement of building and erection of the Project. • “Net Revenues" means, for any Fiscal Year, all Revenues received by the Recipient less the Operations and Maintenance Costs for such Fiscal Year.
• "Operations and Maintenance Costs" means the reasonable and necessary costs paid or incurred by the Recipient for maintaining and operating the System, determined in accordance with GAAP, including all City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit D
reasonable expenses of management and repair and all other expenses necessary to maintain and preserve the System in good repair and working order, and including all reasonable and necessary administrative costs of the Recipient that are charged directly or apportioned to the operation of the System, such as salaries and wages of employees, overhead, taxes (if any), the cost of permits, licenses, and charges to operate the System and insurance premiums; but excluding, in all cases depreciation, replacement, and obsolescence charges or reserves therefor and amortization of intangibles. • “Reimbursement Request” means the Recipient’s request for Project Funds from the State Water Board as set forth in Exhibit B.
• "Revenues" means, for each Fiscal Year, all gross income and revenue received or receivable by the Recipient from the ownership or operation of the System, determined in accordance with GAAP, including all rates, fees, and charges (including connection fees and charges) as received by the Recipient for the services of the System, and all other income and revenue howsoever derived by the Recipient from the ownership or operation of the System or arising from the System, including all income from the deposit or investment of any money in the Enterprise Fund or any rate stabilization fund of the Recipient or held on the Recipient’s behalf, and any refundable deposits made to establish credit, and advances or contributions in aid of construction.
• “System” means all drinking water collection, transport, treatment, storage, and delivery facilities, including land and easements thereof, owned by the City of Porterville, or its successor agency, and all other properties, structures, or works hereafter acquired and constructed by the Recipient and determined to be a part of the System, together with all additions, betterments, extensions, or improvements to such facilities, properties, structures, or works, or any part thereof hereafter acquired and constructed. • “Useful Life” means the economically useful life of the Project beginning at Project Completion and is set forth in Exhibit A.

3. Acknowledgements.

The Recipient must include the following acknowledgement in any document, written report, or brochure to be shared with the general public prepared in whole or in part pursuant to this Agreement:
“Funding for this project has been provided in full or in part under the Drinking Water State Revolving Fund, which may include capitalization funding from the United States Environmental Protection Agency through an agreement with the State Water Resources Control Board. The contents of this document do not necessarily reflect the views and policies of the foregoing, nor does mention of trade names or commercial products constitute endorsement or recommendation for use.”

4. Rates and Charges. The Recipient must, to the extent permitted by law, fix, prescribe and collect rates, fees and charges for the System during each Fiscal Year which are reasonable, fair, and nondiscriminatory and which will be sufficient to generate Revenues in the amounts necessary to cover Operations and Maintenance Costs, and must ensure that Net Revenues are in an amount necessary to meet its obligations under this Agreement. The Recipient may make adjustments from time to time in such fees and charges and may make such classification thereof as it deems necessary, but shall not reduce the rates, fees and charges then in effect unless the Net Revenues from such reduced rates, fees, and charges will at all times be sufficient to meet the requirements of this section.

5. [RESERVED]

6. [RESERVED].

City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit D

7. Environmental/Technical Special Conditions
Technical:

1. The Recipient shall submit its professional engineering services contract to the Division prior to disbursement of funds for costs incurred under such contract.

2. The Recipient shall not solicit bids, award a contract, or commence construction activities until final plans and specifications are approved by the Division of Drinking Water Tulare District Office Engineer and the Project Manager.

3. The Recipient must submit final consolidation agreements with Akin WC and Central MWC, in a form satisfactory to the Division, and receive written approval from the Project Manager to proceed before Project Funds may be disbursed for any Project Costs under the Agreement.

4. Upon completion of the Project the Recipient shall submit a water supply permit amendment request for review to the Division of Drinking Water Tulare District Office.

Environmental:

1. The documents identified below are incorporated by reference and the Recipient shall comply with the conditions and recommendations therein:
a. The Mitigation Monitoring and Reporting Program adopted by the State Water Board on June 16, 2016 for the Project. The Recipient shall implement all mitigation measures therein. b. The letter dated February 12, 2020, from Patricia Cole of the United States Fish and Wildlife Service, San Joaquin Valley Division to Douglas E. Eberhardt of the United States Environmental Protection Agency, including, but not limited to, the following:
i. Implement Avoidance and Minimization Measures and Best Management Practices prior to and during construction activities to minimize and avoid effects to the San Joaquin kit fox.
c. The Mitigation Monitoring and Reporting Program adopted by the City of Porterville on April 21, 2020 for the Central Mutual Water Company Consolidation Project. The Recipient shall implement all mitigation measures therein.

2. In the Recipient’s Quarterly Reports submitted pursuant to this Agreement, the Recipient shall include a discussion of the status of its compliance with environmental measures identified in this Exhibit D, with separate sections clearly labeled and titled, discussing the status of Recipient’s compliance.

3. In the Recipient’s Project Completion Report submitted pursuant to this Agreement, the Recipient shall include a discussion of its compliance with environmental measures identified in this Exhibit D, with separate sections clearly labeled and titled, discussing the status of Recipient’s compliance.

8. [RESERVED].

9. Appointment of Receiver/Custodian. Upon the filing of a suit or other commencement of judicial proceedings to enforce the rights of the State Water Board under this Agreement, the State Water Board may make application for the appointment of a receiver or custodian of the Revenues, pending such proceeding, with such power as the court making such appointment may confer.

10. [RESERVED].

11. Damages for Breach of Federal Conditions. In the event that any breach of any of the provisions of this Agreement by the Recipient results in the failure of Project Funds to be used pursuant to the provisions of this Agreement, or if such breach results in an obligation on the part of the State or any subdivision or agency thereof to reimburse the federal government, the Recipient must immediately reimburse the State or any subdivision or agency thereof in an amount equal to any damages paid by or loss incurred by the State or any subdivision or agency thereof due to such breach.

City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit D

12. [RESERVED].

13. Operation and Maintenance. The Recipient shall sufficiently and properly staff, operate, and maintain the facility and structures constructed or improved as part of the project throughout the term of this Agreement, consistent with the purposes of this Agreement. The Recipient assumes all operations and maintenance costs of the facilities and structures; the State Water Board shall not be liable for any cost of such maintenance, management or operation.

14. Insurance. The Recipient will procure and maintain or cause to be maintained insurance on the System and Project with responsible insurers, or as part of a reasonable system of self-insurance, in such amounts and against such risks (including damage to or destruction of the System or Project) as are usually covered in connection with systems similar to the System or Project. Such insurance may be maintained by a self-insurance plan so long as such plan provides for (i) the establishment by the Recipient of a separate segregated self-insurance fund in an amount determined (initially and on at least an annual basis) by an independent insurance consultant experienced in the field of risk management employing accepted actuarial techniques and (ii) the establishment and maintenance of a claims processing and risk management program. In the event of any damage to or destruction of the System or Project caused by the perils covered by such insurance, the net proceeds thereof shall be applied to the reconstruction, repair or replacement of the damaged or destroyed portion of the System or Project. The Recipient must begin such reconstruction, repair or replacement as expeditiously as possible, and must pay out of such net proceeds all costs and expenses in connection with such reconstruction, repair or replacement so that the same must be completed and the System and Project must be free and clear of all claims and liens. Recipient agrees that for any policy of insurance concerning or covering the construction of the Project, it will cause, and will require its contractors and subcontractors to cause, a certificate of insurance to be issued showing the State Water Board, its officers, agents, employees, and servants as additional insured; and must provide the Division with a copy of all such certificates prior to the commencement of construction of the Project.

15. Notice Events. Upon the occurrence of any of the following events, the Recipient must notify the Division’s Deputy Director and Party Contacts by phone and email within the time specified below:
a. The Recipient must notify the Division within 24 hours by phone at (916) 327-9978 and by email to [email protected] of any discovery of any potential tribal cultural resource and/or archaeological or historical resource. Should a potential tribal cultural resource and/or archaeological or historical resource be discovered during construction or Project implementation, the Recipient must ensure that all work in the area of the find will cease until a qualified archaeologist has evaluated the situation and made recommendations regarding preservation of the resource, and the Division has determined what actions should be taken to protect and preserve the resource. The Recipient must implement appropriate actions as directed by the Division.
b. The Recipient must notify the Division promptly of the occurrence of any of the following events:
i. Bankruptcy, insolvency, receivership or similar event of the Recipient, or actions taken in anticipation of any of the foregoing;
ii. Change of ownership of the Project (no change of ownership may occur without written consent of the Division);
iii. Loss, theft, damage, or impairment to Project;
iv. Events of Default, except as otherwise set forth in this section; City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017

Exhibit D
v. A proceeding or action by a public entity to acquire the Project by power of eminent domain.
vi. Any litigation pending or threatened with respect to the Project or the Recipient’s technical, managerial or financial capacity or the Recipient’s continued existence; vii. Consideration of dissolution, or disincorporation; viii. Enforcement actions by or brought on behalf of the State Water Board or Regional Water Board.
ix. The discovery of a false statement of fact or representation made in this Agreement or in the application to the Division for this funding, or in any certification, report, or request for reimbursement made pursuant to this Agreement, by the Recipient, its employees, agents, or contractors;
x. Any substantial change in scope of the Project. The Recipient must undertake no substantial change in the scope of the Project until prompt written notice of the proposed change has been provided to the Division and the Division has given written approval for the change;
xi. Any circumstance, combination of circumstances, or condition, which is expected to or does delay Completion of Construction for a period of ninety (90) days or more; xii. Any Project monitoring, demonstration, or other implementation activities required in this Agreement;
xiii. Any public or media event publicizing the accomplishments and/or results of this Agreement and provide the opportunity for attendance and participation by state representatives with at least ten (10) working days’ notice to the Division; xiv. Any event requiring notice to the Division pursuant to any other provision of this Agreement.
xv. Completion of work on the Project.
xvi. The Recipient must promptly notify the Division and Party Contacts of cessation of all major construction work on the Project where such cessation of work is expected to or does extend for a period of thirty (30) days or more;
xvii. The Recipient must promptly notify the Division and Party Contacts of the discovery of any unexpected endangered or threatened species, as defined in the federal Endangered Species Act. Should a federally protected species be unexpectedly encountered during implementation of the Project, the Recipient agrees to promptly notify the Division. This notification is in addition to the Recipient’s obligations under the federal Endangered Species Act;
xviii. The Recipient must promptly notify the Division and Party Contacts of Completion of Construction, and Project Completion;
xix. The Recipient must promptly notify the Division and Party Contacts of the award of the prime construction contract for the Project; and the Recipient must promptly notify the Division and Party Contacts of Initiation of construction of the Project.

City of Porterville
Project No.: 5410010-018C/ 5400655-001C
Agreement No.: SWRCB0000000000D2002017