Richmond City Council
June 21, 2022

Contract Amendment between the City of Richmond and

Amendment No. P.O./Contract No.

AMENDMENT PROVISIONS (AMENDMENT HISTORY)

The first Contract Amendment was approved by City Council of the City of Richmond or executed by the City Manager on for one or more of the following provisions (check those that apply):

Increa sed contract payment limit by $ ________________for a payment limit not to exceed $ _________________________.

Term Amendment (insert new termination date):________________________

Service Plan

The second Contract Amendment was approved by City Council of the City of Richmond or executed by the City Manager on for one or more of the following provisions (check those that apply):

Increa sed contract payment limit by $ ________________for a payment limit not to exceed $ _________________________.

Term Amendment (insert new termination date):________________________

Service Plan

The third Contract Amendment was approved by City Coun cil of the City of Richmond or executed by the City Manager on for one or more of the following provisions (check those that apply):

Increa
sed contract payment limit by $ ________________for a payment limit not to exceed $ _________________________.

Term Amendment (insert new termination date):________________________

Service Plan

The fourth Contract Amendment was approved by City Council of the City of Richmond or executed by the City Manager on for one or more of the following provisions (check those that apply):

Increa sed contract payment limit by $ ________________for a payment limit not to exceed $ _________________________.

Term Amendment (insert new termination date):________________________

Service Plan

The fifth Contract Amendment was approved by City Council of the City of Richmond or executed by the City Manager on for one or more of the following provisions (check those that apply):

Increa sed contract payment limit by $ ________________for a payment limit not to exceed $ _________________________.

Term Amendment (insert new termination date):________________________

Service Plan

___ Exhibit F
___ Section 8
City of Richmond - Insurance Requirements - Type 2:

Professional Services

Type 2 – Page 1 of 3

Revised: September 2011
In all instances where CONTRACTOR or its representatives will provide professional services (architects, engineers, construction management, counselors, medical professionals, hospitals, clinics, attorneys, consultants, accountants, etc.) to the City of Richmond (City), the City requires the following MINIMUM insurance requirements and limits.

CONTRACTOR shall procure and maintain for the duration of the contract, agreement, or other order for work, services or supplies, insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder and the results of that work by the CONTRACTOR, its agents, representatives, employees or subcontractors. Maintenance of proper insurance coverage is a material element of the contract. Failure to maintain or renew coverage or to provide evidence of renewal may be treated by the City as a material breach of contract.

CONTRACTOR agrees that in the event of loss due to any of the perils for which it has agreed to provide Commercial General Liability insurance, CONTRACTOR shall look solely to its insurance for recovery.

CONTRACTOR hereby grants to CITY, on behalf of any insurer providing Commercial General Liability insurance to either CONTRACTOR or CITY with respect to the services of CONSULTANT herein, a waiver of any right to subrogation which any such insurer of said CONTRACTOR may acquire against the CITY by virtue of the payment of any loss under such insurance.

Original, signed certificates and original, separate policy endorsements, naming the City as an additional insured for general liability coverage, as well as a waiver of subrogation for Workers’ Compensation insurance, shall be received and approved by the City before any work may begin. However, failure to do so shall not operate as a waiver of these insurance requirements.

City reserves the right to modify or require additional coverages for specific risk exposures depending on scope of CONTRACTORS work.

Minimum coverage is detailed below. The policy limits of coverage shall be made available to the full limits of the policy. The minimum limits stated herein shall not serve to reduce the policy limits of coverage of CONTRACTOR.

Minimum Scope of Insurance – the following forms shall be provided and coverage shall be at least as broad as the following:

1. Insurance Services Office Commercial General Liability coverage (ISO Occurrence Form CG 0001), and including coverage for bodily and personal injury, property damage, and products and completed operations (if applicable).

2. Insurance Services Office Automobile Liability coverage (ISO Form CA 0001, Code 1, Any Auto).

3. Original and Separate Additional Insured Endorsement for General Liability (ISO Form CG 20 10 11/85 or its equivalent) with primary and non-contributory language.

4. Workers’ Compensation Insurance as required by the State of California including Employer’s Liability coverage.

5. Original and Separate Waiver of Subrogation for Workers’ Compensation insurance.

6. Professional Liability or Errors & Omissions Liability Insurance appropriate to the CONTRACTOR’s profession (if required.)

Required Coverage Minimum Limits
Workers’ Compensation and
Employers’ Liability
Statutory limits as required by the State of California including $1 million Employers’ Liability per accident, per employee for bodily injury or disease.

If CONTRACTOR
is self-insured, provide a certificate of Permission to Self- Insure, signed by the California Department of Industrial Relations and Self- Insurance. If contractor is a sole proprietor (has no employees) than contractor must sign “Contractor Release of Liability” found at:
http://www.ci.richmond.ca.us/index.aspx?nid=61.

General Liability
(primary and excess limits
combined)
$2,000,000 per occurrence for bodily injury, personal injury and property damage. If the policy includes a general aggregate, either the general aggregate shall apply separately to this project, service or location or the minimum required aggregate limit shall be twice the per occurrence limit ($4 million aggregate limit).

Policy shall be endorsed to name the City of Richmond as an additional insured per the conditions detailed below.

___ Exhibit F
___ Section 8
City of Richmond - Insurance Requirements - Type 2:

Professional Services

Type 2 – Page 2 of 3

Revised: September 2011
Automobile Liability $1,000,000 per occurrence for bodily injury and property damage.

PROJECT COST R EQUIRED LIMIT
$0 - $1 million $1 million p/o
$1 million - $5 million $2 million p/o
Over $5 million $5 million p/o

Professional Liability or Errors &
Omissions Liability –
Required for all professionals
including architects, engineers,
consultants, construction
management, counselors, medical
professionals, hospitals, clinics,
attorneys and accountants, & other
consultants as may be required by
the City.

Required Policy Conditions
Additional Insured Endorsement

Applicable to General Liability coverage.

The City of Richmond, its officers, officials, employees, agents and volunteers are to be named as additional insureds for all liability arising out of the operations by or on behalf of the named insured including bodily injury, deaths and property damage or destruction arising in any respect directly or indirectly in the performance of this contract.

ISO form CG 20 10 (11/85) or its equivalent is required. If the Contractor is supplying their product or providing a service then the endorsement must not
exclude products and completed operations
coverage. If it does, then CG 20 37 (10/01) is also required.

SAMPLE Endorsements can be found at
http://www.ci.richmond.ca.us/index.aspx?nid=61
.

Primary and Noncontributory The contractor’s insurance coverage must be primary coverage as it pertains to the City, its officers, officials, employees, agents and volunteers. Any insurance or self insurance maintained by the City is wholly separate from the insurance of the contractor and in no way relieves the contractor from its responsibility to provide insurance.

Waiver of Subrogation
Endorsement Form
Contractor’s insurer will provide a Waiver of Subrogation in favor of the City for Workers’ Compensation Insurance during the life of this contract.

SAMPLE Endorsements can be found at
http://www.ci.richmond.ca.us/index.aspx?nid=61.

Deductibles and Self-Insured
Retentions
Any deductible or self-insured retention must be declared to and approved by the City. At the option of the City either the insurer shall reduce or eliminate such deductibles or self-insured retention as respects the City or the CONTRACTOR shall procure a financial guarantee in an amount equal to the deductible or self-insured retention guaranteeing payment of losses and related investigations, claims administration and defense expenses.

Contractor is responsible for satisfaction of the deductible and/or self-insured retention for each loss.

A. M. Best Rating A:VII or Better. If the A.M. Best Rating falls below the required rating, CONTRACTOR must replace coverage immediately and provide notice to City.

Umbrella/Excess Liability Policies
If an Umbrella or Excess Liability Policy is used to meet the liability limits, coverage shall be as broad as specified for underlying coverage’s and cover those insured in the underlying policies.

___ Exhibit F
___ Section 8
City of Richmond - Insurance Requirements - Type 2:

Professional Services

Type 2 – Page 3 of 3

Revised: September 2011
Claims-Made Policies
If any insurance policy is written on a claims-made form: 1) the retroactive date must be shown, and must be before the date of the contract or the beginning of contract work. 2) Insurance must be maintained and evidence of insurance must be provided for at least five (5) years after completion of the contract of work. 3) If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a retroactive date prior to the contract effective date, the Contractor must purchase an extended period coverage for a minimum of five (5) years after completion of contract work.

Subcontractors

CONTRACTOR
shall include all subcontractors as insured under its policies or shall furnish to the City for review and approval, separate certificates and endorsements for each subcontractor. All coverage for subcontractors shall be subject to all of the requirements stated herein.

CONTRACTOR agrees to defend and indemnify the City of Richmond for any damage resulting to it from failure of either CONTRACTOR or any subcontractor to take out or maintain the required insurance policies.

The fact that
insurance is obtained by CONTRACTOR, and/or CONTRACTOR’s subcontractors, will not be deemed to release or diminish the liability of CONTRACTOR, including, without limitation, liability under the indemnity provisions of this contract. Damages recoverable by CITY from CONTRACTOR or any third party will not be limited by the amount of the required insurance coverage.

Verification of Coverage
All original certificates and endorsements shall be received and approved by the City before work may begin .

The City of Richmond reserves the right to require complete, certified copies of all required insurance policies including endorsements affecting the coverage at any time.

Original insurance certificates and required policy endorsements shall be mailed or delivered to the Designated Project Manager for the City of Richmond.

Insurance certificates and endorsements may be faxed to the Designated Project Manger. However, CONTRACTOR must mail the original certificates and endorsements to Designated Project Manager once faxed.

Continuous Coverage
CONTRACTOR shall maintain the required insurance for the life of the contract. Should the CONTRACTOR cease to have insurance as required during this time, all work by the CONTRACTOR pursuant to this agreement shall cease until insurance acceptable to the City is provided. In the event that CONTRACTOR fails to comply with the City’s insurance requirements, the City may take such action as it deems necessary to protect the City’s interests. Such action may include but is not limited to termination of the contract, withholding of payments, or other actions as the City deems appropriate.

If services or the scope of work extend beyond the expiration dates of the required insurance policies initially approved by the City, CONTRACTOR must provide updated certificates and endorsements indicating that the required coverage, terms and conditions are still in place. Renewal certificates and updated endorsements shall be mailed to the Designated Project Manager.

Cancellation
CONTRACTOR shall ensure that coverage shall not be cancelled, reduced or otherwise materially changed except after thirty (30) days’ prior written notice has been given to the City.

Reporting Requirements

Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officers, officials, employees or volunteers.

Consistent with Public Policy
The insuring provisions, insofar as they may be judged to be against public policy shall be void and unenforceable only to the minimum extent necessary so that the remaining terms and provisions herein may be consistent with public policy and thus enforceable.

EXHIBIT I-1

BRYAN KERN, Principal
11121 Carmel Commons Blvd., Suite 375
Charlotte, NC 28226
Office: (980) 272-1904
Email: [email protected]

May 9, 2022

Anil Comelo
Interim Deputy City Manager
City of Richmond, California
450 Civic Center Plaza
Suite 300
Richmond, CA 94804

Via e-mail: [email protected]

Re: Swap Advisory Services for City of Richmond, California (the “Client”)

Dear Mr. Comelo:

On behalf of my colleagues at KPM Financial, LLC (“KPM”) I am pleased to provide this engagement letter to provide derivatives advisory services to Client. KPM is a full-service derivatives advisory firm focused on serving the needs of its clients with th e highest levels of integrity and in a fully transparent manner. As such, and based upon our understanding of the proposed assignment, the following outlines KPM’s proposed engagement by Client and the basis for compensation.

SCOPE OF SERVICES . KPM will provide derivatives advisory services to Client relating to the proposed termination of the interest rate swap associated with its Series 2005 Pension Obligation Bonds (the “Bonds”) on a task-by-task basis as requested by Client. We have listed below a number of major deliverables pertaining to the services we will provide. The engagement may include any or all of the services outlined below or similar services which might be requested by Client from time to time.

Interest Rate Swap Advisory

▪ Provide ongoing monitoring of Client’s existing swap to include periodic market valuations as needed. ▪ Participate in any strategic planning sessions as it relates to the refunding of the Bonds and the termination of the associated swap.
▪ Assist Client, in conjunction with its legal counsel, in the completion/updated of any regulatory or pre- trade disclosure statements, acknowledgments or agreements. ▪ Review the appropriate interest rate swap documentation including, but not limited to, authorizing resolution, hedge identification letter (if applicable), Schedule to the ISDA Master Agreement, Credit Support Annex (if applicable), and confirmation.
▪ Provide transactional education and analysis for Client’s staff and board, as required. ▪ In conjunction with any swap, KPM may create a bid package, abbreviated term sheet, or other oral or written summary (in each case, a “Bid Package”), which may outline the financial terms, credit, and documentation requirements of the existing swaps. KPM will seek Client’s authorization and approval prior to distributing any Bid Package.
▪ Facilitate the termination of Clients’ interest rate swap. Such process may include distributing a pre- approved Bid Package and conducting a competitive bid or a direct negotiation with a counterparty approved by the Client.
▪ Provide a Certificate of Hedge Advisor in conjunction with the execution of the interest rate derivative to be relied upon by tax counsel for making necessary identifications for tax purposes, if applicable. ▪ Provide a Price Verification Certificate in conjunction with the swap incorporating a verification of the reasonableness of the swap provider’s spread.

EDITED VERSION

▪ Maintain written policies and procedures reasonably designed to ensure that KPM has sufficient knowledge to evaluate proposed transactions and risks.

It is expressly understood that KPM is not acting as Client’s financial advisor in a more general manner and will not be reviewing financial documents (other than ISDA and other financing documents specifically related to the proposed swap) on Client’s behalf including, but not limited to, the Official Statement (if one exists). KPM will not be providing advice to Client regarding the most appropriate underlying debt instruments.

ENGAGEMENT DURATION. The term of this engagement shall commence on the execution date of this engagement letter and shall expire upon the completion of any swap transaction terminated in conjunction with this engagement. The engagement may be extended by mutual agreement, and with additional provisions, as necessary, for additional terms beyond the initial engagement expiration.

CLIENT’S DECISION. With respect to any matter described in this engagement letter, nothing herein shall limit Client’s unqualified right in Client’s discretion: (a) to reject in whole or in part any advice, suggestion, counsel or proposal made by KPM; or (b) to make any decision Client deems to be in the best interests of Client, including but not limited to any decision with respect to any swap transaction, issue or sale of notes, bonds or other obligations.

PERFORMANCE. In providing the services under this engagement, KPM will provide a duty of care and loyalty, make full and fair disclosure of all material facts and conflicts of interest and employ reasonable care to advance Client’s objectives. It is expressly understood that KPM in its regular course of business acts in an advisory capacity relating to transactions between unrelated clients and Client’s actual or proposed swap provider.

RELIANCE. In performing this engagement, KPM w
ill rely upon Client to provide requested or relevant financial, disclosure and other information pertaining to Client or the potential swap transaction(s) and, among other things, to comply with then-existing disclosure standards or requirements. KPM will not independently verify the accuracy or sufficiency thereof but in all such regards instead shall be entitled to, and will, rely upon Client and other agents of Client without further investigation by KPM. It is further understood that KPM will not provide advice to Client relating to any transactions or recommendations to which KPM is not made aware and Client has not requested the advice be provided.

COMPENSATION. In consideration of providing the above Interest Rate Swap Advisory Services at the direction of the Client, KPM will be paid a fixed fee of $10,000 as a retainer for services paid at the time of execution of this agreement. In addition, KPM will be paid a fixed fee of $40,000 at the time of the termination of the referenced transaction IF BONDS ARE ISSUED. Total contracted fee – ex clusive of expenses – shall be $50,000.

In addition to the compensation for professional services outlined above, KPM asks to be reimbursed for out- of- pocket expenses incurred in connection with providing financial advisory services. Customary out- of-pocket expenses include costs of travel, meals, lodging, printing/copying, etc. KPM will not receive reimbursement for indirect costs such as telephone, fax, and conference call services.

Such fee may vary if unusual or unforeseen circumstances arise which require a significant increase in the type or scope of our responsibilities. If at any time we believe circumstances require an adjustment of our fee as set forth above, we will consult with you and will promptly provide an updated Scope of Services through a separate writing.

In conjunction with this solicitation, Client will be directly responsible for:

1) Client attorneys’ fees and other attorneys’ fees that Client agrees to pay. 2) Fees and expenses of Bond Counsel.

CONFLICTS OF INTEREST. The duties, obligations, and responsibilities of the parties hereto only shall be those specified in this Agreement, and this Agreement shall in no way impair the right of KPM to act on behalf of any other party or parties unless doing so would create an i mpermissible and unavoidable conflict of interest. KPM represents that in connection with the completion of a transaction, KPM may receive compensation from the Client for services rendered, which compensation is contingent upon the successful closing of a transaction and/or is based on the size of a transaction. Consistent with the requirements of the Municipal Securities Rulemaking Board’s (“MSRB”) Rule G-42, KPM hereby discloses that such contingent and/or transactional compensation may present a poten tial conflict of interest regarding KPM’s ability to provide unbiased advice to enter into such transaction. This conflict of interest will not impair KPM’s ability to render unbiased and competent advice or to fulfill its fiduciary duty to Client.

If KPM becomes aware of any additional potential or actual conflict of interest after this disclosure, KPM will disclose the detailed information in writing to the Client in a timely manner.

LEGAL AND DISCIPLINARY EVENTS. Pursuant to Section 15B of the Exchange Act, KPM is registered as a Municipal Advisor with the SEC and the MSRB. This registration, among other things, serves to disclose legal and disciplinary actions against the municipal advisor. KPM does not have any legal events or disciplinary history on KPM’s Form MA and Form MA-I, which includes information about any criminal actions, regulatory actions, investigations, terminations, judgments, liens, civil judicial actions, customer complaints, arbitrations and civil litigation. The Issuer may electronically access KPM’s most recent Form MA and each most recent Form MA- I filed with the Commission at the following website: www.sec.gov/edgar/searchedgar/companysearch.html .

There have been no material changes to a legal or disciplinary event disclosure on any Form MA or Form MA- I filed with the SEC. If any material legal or regulatory action is brought against KPM, KPM will provide complete disclosure to the Issuer in detail allowing the Issuer to evaluate KPM, its management and personnel.

CUSTOMER COMPLAINTS. Pursuant to MSRB Rule G-10, on Investor and Municipal Advisory Client Education and Protection, Municipal Advisors are required to provide certain written information to their municipal entity and obligated person clients. As such, within the MSRB website at www.msrb.org , Client may obtain the Municipal
Advisory client brochure that is posted on the MSRB website. The brochure describes the protections that may be provided by the MSRB Rules along with how to file a complaint with financial regulatory authorities.

We look forward to working with you during this engagement. Please acknowledge acceptance of these terms by signing in the space provided below and returning an electronic copy to us.

Sincerely,

Bryan Kern
Managing Member

City of Richmond, California

__________________________________
By

__________________________________
Title

__________________________________
Date

June 21, 2022

Finance Department

DATE: June 21, 2022
TO: Mayor Butt and Members of the City Council
FROM:

Anil Comelo, Interim Deputy City Manager
Delmy Cuellar, Director of Finance

Subject:

Resolution Authorizing Issuance of Taxable Pension
Refunding Bonds, Series 2022 ("2022 Refunding Bonds")
FINANCIAL IMPACT: Potential increase in annual debt service required because of need to fund termination payment on an
interest rate swap.

PREVIOUS COUNCIL
ACTION:

April 6, 2021; October 5, 2021; December 7, 2021, June
7, 2022

STATEMENT OF THE
ISSUE:

On June 7th, the City Council heard a presentation on
the proposed refinancing of the 2005 Pension Obligation Bonds ("2005 POBs"). The Council is being asked to
consider authorizing the issuance of the refinancing of the 2005 POBs, as well as to approve a supplemental
indenture for the refinancing.

RECOMMENDED ACTION:

APPROVE resolution authorizing issuance of taxable
pension refunding bonds, series 2022, to refund certain outstanding taxable pension funding bonds of the City,
authorizing the execution of a first supplemental
indenture, and approving and directing of other matters related thereto.

DISCUSSION:

Background. The City currently has the following outstanding two series of 2005 POBs:
(i) an approximately $18 million principal amount series maturing in 2023 (the "B-1 AGENDA
REPORT

June 21, 2022
Bonds"), and (ii) an approximately $130 million principal amount series maturing in 2034 (the "B-2 Bonds"). The City needs to refinance the $130 million series. The City is also party to two interest rate swaps (the “Swaps”) associated with the 2005 POB's.

However, the swap for the B-2 Bonds (the “B-2 Swap”) is subject to mandatory early termination on August 1, 2023, before which time the City will need to either (a) arrange financing to pay the market value of the B-2 Swap upon such early termination or (b) amend the B-2 Swap to remove, reduce, or delay the mandatory early termination.

The Refinancing Plan. The City's finance team has made a preliminary determination that refinancing both the B-1 and B-2 series of the 2005 POB's is advisable. As was explained to City Council at the June 7th presentation, this will enable the City to (1) make debt service payments several business days in advance of their due date, as opposed to the current mandate to make such payments about one year in advance and (2) eliminate the mandate for the County to directly transfer the pension tax override and other property tax revenue necessary for debt service to the trustee on the 2005 POB's. The City's finance team has also made a preliminary determination that a defeasance of the remaining 1999 bonds may be advisable for similar reasons.

In addition, the City's finance team has made a preliminary determination that extending the amortization period for the 2022 Refunding Bonds beyond the current final maturity for the B-2 Bonds of August 1, 2034, may be advisable. Such an extension may optimize the allocation of the City's approximately $24 million per year in pension tax override revenues to reduce future need to pay CalPERS costs from regular General Fund revenues.

The Options Allowed Under the Resolution. The authorizing resolution gives the City the option to (1) refinance both the B-1 and B-2 series of 2005 POB's and (2) amortize the principal on the 2022 Refunding Bonds for a period of up to 30 years. The resolution, however, does not commit the City to either of these options. As is explained in the Finance Schedule section below, the City Council would make a final decision on these options at its July 19 or July 26th meeting.

Maximum Authorized Principal Amount. The resolution authorizes a maximum principal amount for the refinancing of $170 million. This is significantly more than the combined outstanding amount of the 2005 POB's, which is approximately $146 million.

The difference between these two numbers allows additional bonds to be sold to fund the termination payment under the Swaps.

The "Good Faith Estimates" in Appendix A. The City's municipal advisor, NHA Advisors, is required by state law to provide "Good Faith Estimates" of the cost of a bond issue at the time the City Council adopts the authorizing resolution for a bond issuance. These estimates are shown in Appendix A of the authorizing resolution. The estimated amount of 2022 Refunding Bonds is shown in Appendix A at $155,755,000.

The difference between this figure and the $170 million maximum authorized principal amount in the authorizing resolution is due to (1) a scheduled major payment of

June 21, 2022
principal on the B-1 Bonds on August 1, 2023, and (2) the finance team wanting to be conservative on the amount of the swap termination payment.

The Supplemental Indenture. The authorizing resolution also approves a form of a Supplemental Indenture for the 2022 Refunding Bonds. This legal document is called a "Supplemental Indenture" because it is a supplement to the original indenture for the 2005 POB's. The Supplemental Indenture sets forth how all cash flows related to the 2022 Refunding Bonds are to be managed by the City and the bond trustee.

The Financing Schedule. The City Council will be asked to consider approval of other legal documents required for the 2022 Refunding Bonds at its meeting of either July 19th or July 26th. The Supplemental Indenture is recommended for approval on June 21st because if the actual closing for the bond issuance takes place 60 or more days after City Council approval, additional legal protections for all the bond provisions, including the pension tax override, is provided under State law.

As noted earlier, no final decision on (1) refinancing the B-1 bonds, (2) defeasing the 1999 bonds or (3) extending the term of the 2022 Refunding Bonds will be made until the proposed City Council action on July 19th or 26th. At that time, the City's finance team will provide a final recommendation based on the now in process actuarial analysis of the eligibility of future pension tax override revenues to pay future CalPERS expenses.

Assuming City Council approval of the other legal documents required by the 2022 Refunding Bonds, as well as the final recommendations on the financing plan, as described above, at its meeting of either July 19th or July 26th, the 2022 Refunding Bonds will be sold in late August.

DOCUMENTS ATTACHED:

Attachment 1 - A Resolution of the City Council of the City of Richmond Authorizing the Issuance of its Taxable Pension Refunding Bonds, Series 2022, to Refund Certain Outstanding Taxable Pension Funding Bonds of the City, Approving the Form and Authorizing the Execution of a First Supplemental Indenture and Approving and Directing Other Matters Related Thereto

Attachment 2 - First Supplemental Indenture By and Between the City of Richmond US Bank Trust Company, National Association, as Trustee

RESOLUTION NO. ___

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF RICHMOND

AUTHORIZING THE ISSU ANCE OF ITS TAXABLE PENSION REFUNDING BONDS, SERIES 2022, TO REFUND CERTAIN OU TSTANDING TAXABLE

PENSION FUNDING BONDS OF THE CITY , APPROVING THE FORM AND

AUTHORIZING THE EXECUTION OF A FIRST SUPPLEMENTAL INDENTURE,

AND APPROVING AND DIRECTING OTHER MATTERS RELATED THERETO WHEREAS, the City of Richmond (the “City”) is a contracting member of the California Public Employees’ Retirement System (the “System”), and as such the City is obligated to make certain payments to the System (the “PERS Obligation”); and WHEREAS, pursuant to Resolution No. 35-05, adopted by the City Council of the City (the “City Council”) on March 29, 2005 (the “2005 Authorizing Resolution”) , the City Council authorized, among other things, the issuance by the City of pension funding bonds (the “Series 2005 Bonds”) for the purpose of refunding its PERS Obligation and additional pension funding bonds in the future from time to time for similar purposes (“Additional Bonds”), and interest rate swaps or swaptions (collectively, the “Swap Agreements”) in connection w ith any such bonds pursuant to Section 5922 of the California Government Code for the purpose of lowering the cost of borrowing; and
WHEREAS, pursuant to the 2005 Authorizing Resolution, the City Council also authorized the institution of a proceeding for judicial validation of the Series 2005 Bonds, the Additional Bonds, the Indenture and the Swap Agreements therefor in the Superior Court of Contra Costa County, under and pursuant to the provisions of Sections 860 et seq. of the California Code of Civil Procedure (the “Validation Proceeding”);
WHEREAS, a default judgment was entered in the Validation Proceeding on May 25, 2005, to the effect that, among other things, the Series 2005 Bonds, the Additional Bonds, the Indenture, and the Swap Agreements are valid and legal obligations of the City; and WHEREAS, for the purpose of refunding a portion of the City’s PERS Obligation, the City subsequently issued the Series 2005 Bonds in three separate series bonds as follows: (i) City of Richmond Taxable Pension Funding Bonds, Series 2005A (the “Series 2005A Bonds”), in the initial principal amount of $26,530,000, (ii) City of Richmond Taxable Pension Funding Bonds, Series 2005B-1 (the “Series 2005B-1 Bonds”), in the initial principal amount of $47,061,960, and (iii) City of Richmond Taxable Pension Funding Bonds, Series 2005B -2 (the “Series 2005B -2 Bonds”), in the initial principal amount of $47,061,960; and WHEREAS, the City issued the Series 2005 Bonds pursuant to an Indenture, dated as of November 1, 2005 (the “Original Indenture”), by and between the City and U.S. Bank Trust Company, National Association, as successor trustee (the “Trustee”) (capitalized terms used but not defined herein have the meanings given to such terms in the Original Indenture); and WHEREAS, the Series 2005A Bonds matured in full on August 1, 2013, and are no longer outstanding; and
WHEREAS, the Series 2005B -1 Bonds are outstanding in the principal amount of $17,899,000, have a final maturity date of August 1, 2023, and bear interest at a variable rate ; and

WHEREAS, the Series 2005B -2 Bonds were issued as Convertible A uction Rate Securities, are accreting interest (with a full accretion date of August 1, 2023, at which time the full accreted principal amount thereof will be $127,968,000), and have a final maturity date of August 1, 2034; and
WHEREAS, in an effort to lower the cost of borrowing of the Series 2005B-1 Bonds and the Series 2005B-2 Bonds (collectively, the “Series 2005B Bonds”) and in compliance with Section 5922 of the California Government Code, the City entered into an interest rate swap pursuant to an ISDA Master Agreement, together with the schedule and confirmations thereto (the “2016 Swap Agreement”), between the City and the Royal Bank of Canada (“RBC”), pursuant to which the variable rate of interest on the Series 2005B Bonds was exchanged for a fixed rate of interest; and
WHEREAS, the portion of the 2016 Swap Agreement relating to the Series 2005B -2 Bonds is subject to mandatory termination on August 1, 2023; and WHEREAS, the Original Indenture provides that the City may at any time issue Additional Bonds (in addition to the Series 2005 Bonds) on a parity with the Series 2005 Bonds for the purpose, among others, of refunding any outstanding Series 2005 Bonds, including pay ment of all costs incidental to or connected with such refunding, upon compliance with the procedure set forth in Article III of the Original Indenture; and
WHEREAS, the City is authorized under the provisions of Articles 10 and 11 of Chapter 3 of Part 1 o f Division 2 of Title 5 of the California Government Code, commencing with Section 53570 of said Code (the “Bond Law”), to issue its bonds for the purpose of refunding certain outstanding obligations of the City, including all or a portion of the outstandi ng Series 2005B Bonds and paying the Termination Fee; and
WHEREAS, the City has determined that it is in the best interest of the City and the public to refund all o r a portion of the outstanding Series 2005B Bonds, terminate the 2016 Swap Agreement with respect to all or a portion of the Series 2005B Bonds and pay the related termination fee (the “ Termination Fee ”) in connection with the termination of the 2016 Swap Agreement for such bonds (the “Termination”), and therefore the City Council desires to authorize the issuance of its Taxable Pension Refunding Bonds, Series 2022 (the “Series 2022 Bonds”) to (i) refund all or a portion of the outstanding Series 2005B Bonds , (ii) pay the Termination Fee, and (iii) pay all other related costs of issuing the Series 2022 Bonds; and WHEREAS, the City has levied and continues to levy an ad valorem property tax override at a rate of 0.14% of the assessed value of all taxable property within the City (the “Pension Tax Override”) to pay for pension obligations of the City approved by the voters prior to July 1, 1978 as permitted under Section 1(b)(1) of Article XIIIA of the California Constitution; and WHEREAS, pursuant to Section 5451 of the Government Code of the State of California, one or more of the Series 2022 Bonds may be secured by a pledge of, and lien and security interest in, all of the City’s rights, title and interest in all or a portion of the Pension Tax Override Revenues pursuant to the Original Indenture as amended and supplemented by the hereinafter defined First Supplemental Indenture, subject to the limitations set forth herein; and WHEREAS, to provide for the issuance and the terms of the Series 2022 Bonds, the City proposes to enter into a First Supplemental Indenture with the Trustee , supplementing and amending the Original Indenture (the “First Supplemental Indenture”); and

WHEREAS, the City Council desires to (i) authorize the issuance of the Series 2022 Bonds and the execution of such documents and the performance of such acts as may be necessary or desirable to effect the issuance of the Series 2022 Bonds, and (ii) direct City staff to return to the City Council for final approval of the Series 2022 Bonds and related documents at a future date; and
WHEREAS, pursuant to Section 5852.1 of the California Government Code, certain financial information relating to the Series 2022 Bonds is attached hereto as Appendix A, and such information has been disclosed and made public; and WHEREAS, the City Council previously approved a Debt Management Policy for the City that complies with Government Code Section 8855, and an Interest Rate Swap Policy (the “Swap Policy”); and
WHEREAS, the Series 2022 Bonds will be in compliance with the D ebt Management Policy and the Swap Policy.

NOW, THEREFORE, the City Council of the City of Richmond resolves as follows:

Section 1. The foregoing recitals are true and correct and this City Council hereby so finds and determines.

Section 2. The Series 2022 Bonds to refund all or a portion of the outstanding Series 2005B Bonds, pay the Termination Fee and pay all other related costs of issuing the Series 2022 Bonds on the terms and conditions set forth herein, and the other actions contemplated hereby, are in the best interests of the City.

Section 3. The City Council hereby authorizes the issuance of the Series 2022 Bonds by the City under the Bond Law in one or more series in the aggregate principal amount of not to exceed $170,000,000 to refund all or a portion of the outstanding Series 2005B Bonds, pay the Termination Fee and pay all other related costs of issuing the Series 2022 Bonds ; provided, however, that (a) the Series 2022 Bonds shall be issued as fixed rate bonds, (b) the Series 2022 Bonds shall mature not later than 30 years from the date of issuance thereof, (c) the portion of the Series 2022 Bonds allocable to the Termination Fee shall be payable solely from the General Fund of the City, and (d) upon consultation with the City Attorney and Jones Hall, A Professional Law Corporation, as Bond Counsel (“Bond Counsel”), the Series 2022 Bonds may be secured by a pledge of, and lien and security interest in, all of the City’s rights, title and interest in all or a portion of the Pension Tax Override Revenues pursuant to Section 5451 of the California Government Code to the extent set forth in the First Supplemental Indenture. Without limiting the foregoing, the Series 2022 Bonds shall be dated, shall bear interest at the rates set forth in the First Supplemental Indenture, shall mature on the date or dates, shall be issued in the form and shall be as otherwise provided in the First Supplemental Indenture. It is the intent of the City that the interest on each series of Series 2022 Bonds be subject to all applicable federal income taxation. In compliance with the City’s Debt Management Policy and Swap Policy, the City shall not enter into any interest rate swap agreements in connection with the execution and delivery of the Series 2022 Bonds.

The obligations of the City under the Series 2022 Bonds, including the obligation to make all payments of interest and principal when due, are obligations of the City imposed by law and are absolute and unconditional, without any right of set -off or counterclaim. The Series 2022 Bonds do not constitute an obligation of the City for which the City is obligated to levy or pledge

any form of taxation, except with respect to the Pension Tax Override to the extent set forth in the Original Indenture as amended by the First Supplemental Indenture . Neither the Series 2022 Bonds nor the obligation of the City to make payments on the Series 2022 Bonds constitutes an indebtedness of the City, the State of California, or any of its political subdivisions within the meaning of any constitutional or statutory debt limitation or restriction.

Section 4. The City Council hereb y approves the First Supplemental Indenture in substantially the form presented to this meeting, with such changes, insertions and omissions as the Mayor, the City Manager, the Assistant City Manager, the Finance Director, and such other officers of the Ci ty as the Mayor or the City Manager may designate (each, an “Authorized Officer”), each acting alone, executing the same may, upon consultation with City Attorney and Bond Counsel, require or approve, such requirement or approval to be conclusively evidenced by the execution of the First Supplemental Indenture by such Authorized Officer. The City Clerk is authorized and directed to attest to the First Supplemental Indenture.

Section 5. The City Council hereby authorizes the Authorized Officers: (i) to solicit bids for a municipal bond insurance policy and/or reserve insurance policy for any series of Series 2022 Bonds; (ii) to negotiate the terms of such policy or policies; (iii) to finalize, if appropriate, the form of such policy or policies with a municipal bond insurer; and (iv) if it is determined that the policy or policies will result in net debt service savings on any such series of Series of 2022 Bonds, to pay the insurance premi um of such policy or policies from the proceeds of the issuance and sale of such bonds.

Section 6. The Termination is hereby approved and the City Council hereby authorizes the payment of the Termination Fee from the proceeds of the Series 2022 Bonds.

Each Authori zed Officer, acting alone, is hereby authorized to negotiate the terms of the Termination and the Termination Payment with RBC.

Section 7. The City Council hereby direct s City staff to cause the following to be submitted to the City Council for final approval of the Series 2022 Bonds at a future date: (i) an agreement for the purchase of one or more series of Series 2022 Bonds by the underwriters or other purchasers thereof; (ii) if it is determined that the Series 2022 Bonds are to be sold through a public offering, a Preliminary Official Statement relating to the Series 2022 Bonds , to be prepared by Best, Best & Krieger LLP, the City’s disclosure counsel; (iii) the final form of the First Supplemental Indenture; (iv) a termination agreement with respect to the 2016 Swap Agreement; and (v) such other agreements and documents as are necessary or convenient to implement the issuance, sale and delivery of one or more series of the Series 2022 Bonds. All actions heretofore taken by Authorized Officers and by any other officers, employees or agents of City with respect to the issuance of the Series 2022 Bonds, or in connection with or related to any of the agreements or documents referenced herein, are hereby approved, confirmed and ratified.

Section 8. This Resolution shall take effect immediately upon its passage and adoption. Adoption of this Resolution is intended to start the 60 day period provided for in Section 863 of the California Code of Civil Procedure for an interested person to bring an action to determine the validity of the matters approved herein, including, but not limited to, the validity of the First Supplemental Indenture and the Series 2022 Bonds, and the legality and validity of this Resolution, the use of the proceeds of the Series 2022 Bonds, the pledge of all or a portion of the Pension Tax Override Revenues as security for the Series 2022 Bonds, and the payment of the principal of, and interest on, the Series 2022 Bonds.

I certify that that the foregoing Resolution passed and adopted by the City Council of the City of Richmond, at a regular meeting held on the June ___, 2022, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAIN:

Pamela Christian
City Clerk

Approved:

Thomas K. Butt
Mayor

Approved as to form:

Dave Aleshire
City Attorney

APPENDIX A

REQUIRED DISCLOSURES PURSUANT TO
GOVERNMENT CODE SECTION 5852.1

The good faith estimates set forth herein are provided with respect to the Series 2022 Bonds in accordance with California Government Code Section 5852.1. Such good faith estimates have been provided to the City by NHA Advisors, LLC, the City ’s Municipal Advisor , with the assistance of Loop Capital Markets LLC and Hilltop Securities Inc., as the underwriters of the Series 2022 Bonds.

Principal Amount . The Municipal Advisor has informed the City that, based on the financing plan an d current market conditions, it s good faith estimate of the aggregate principal amount of the Series 2022 Bonds to be sold is $155,755,000 (the “Estimated Principal Amount”).

True Interest Cost of the Series 2022 Bonds. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the Series 2022 Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the true interest cost of the Series 2022 Bonds, which means the rate necessary to discount the amounts payable on the respective principal a nd interest payment dates to the purchase price received for the Series 2022 Bonds, is 4.72%.

Finance Charge of the Series 2022 Bonds. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the Series 2022 Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the finance charge for the Series 2022 Bonds, which means the sum of all fees and charges paid to third parties (or costs associated with the Series 2022 Bonds ), is $1,165,902.

Such fees and charges include fees for bond and disclosure counsel, municipal advisor, printing, and underwriting.

Amount of Proceeds to be Received . The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the Series 2022 Bonds, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the amount of proceeds expected to be received from the sale of the Series 2022 Bonds , less the finance charge of the Series 2022 Bonds , as estimated above , and any reserves or capitalized interest paid or funded with proceeds of the Series 2022 Bonds, is $154,589,098.

Total Payment Amount. The Municipal Advisor has informed the City that, assuming that the Estimated Principal Amount of the Series 2022 Bonds is sold, and based on market interest rates prevailing at the time of preparation of such estimate, its good faith estimate of the total payment amount, which means th e sum total of all payments to pay debt service on the Series 2022 Bonds, plus the financ e charge for the Series 2022 Bonds , as described above, not paid with the proceeds of the Series 2022 Bonds , calculated to the final maturity of the Series 2022 Bonds, is $222,797,145.

The foregoing estimates constitute good faith estimates only. The actual principal amount of the Series 2022 Bonds issued and sold, the true interest cost thereof, the finance charges thereof, the amount of proceeds received therefrom and total payment amount with respect thereto may differ from such good faith estimates du e to (a) the actual date of the sale of the Series 2022 Bonds being different than the date assumed for purposes of such estimates, (b) the actual principal amount of Bonds sold being different from the Estimated Principal Amount, (c)

the actual amortization of the Series 2022 Bonds being different than the amortization assumed for purposes of such estimates, (d) the actual market interest rates at the time of sale of the Series 2022 Bonds being different than those estimated for purposes of such estimates, (e) other market conditions, or (f) alterations in the financing plan, delays in the financing, or a combination of such factors. The actual date of sale of the Series 2022 Bonds and the actual principal amount of Bonds sold will be determined by the City based on the timing of the need for proceeds of the Series 2022 Bonds and other factors. The actual interest rates borne by the Series 2022 Bonds will depend on market interest rates at the time of sale thereof. The actual amortization of the Series 2022 Bonds will also depend, in part, on market interest rates at the time of sale thereof. Market interest rates are affected by economic and other factors beyond the control of the City.

AGENDA DRAFT

FIRST SUPPLEMENTAL INDENTURE

by and between

CITY OF RICHMOND

and

U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,

AS TRUSTEE

Dated as of ______ 1, 2022

Relating to

City of Richmond
Taxable Pension Refunding Bonds,
Series 2022

i

TABLE OF CONTENTS

ARTICLE XI
SERIES 2022 BONDS
Section 11.01. Definitions ........................................................................................................ 3 Section 11.02. Authorization of Series 2022 Bonds ................................................................ 4 Section 11.03. Terms of Series 2022 Bonds ........................................................................... 4 Section 11.04. Form of Series 2022 Bonds ............................................................................. 5 Section 11.05. Procedure for the Issuance of Series 2022 Bonds; Application of Series 2022 Bond Proceeds ............................................................................ 6 Section 11.06. Book-Entry System for the Series 2022 Bonds ............................................... 6 Section 11.07. Redemption of Series 2022 Bonds.................................................................. 8 Section 11.08. Notice of Redemption for Series 2022 Bonds ................................................. 9 Section 11.09. Selection of Series 2022 Bonds for Redemption .......................................... 10 Section 11.11. Continuing Disclosure .................................................................................... 10 Section 11.12. Continuing Disclosure .................................................................................... 11 Section 11.13. Effect of First Supplemental Indenture .......................................................... 15 Section 11.14. Execution in Several Counterparts ................................................................ 15 Section 11.15. Effective Date ................................................................................................. 15

APPENDIX M – FORM OF SERIES 2022 BOND
APPENDIX N – SCHEDULE OF SERIES 2022 BOND APPLICABLE PERCENTAGE

1 FIRST SUPPLEMENTAL INDENTURE

THIS FIRST SUPPLEMENTAL INDENTURE (this “First Supplemental Indenture”), dated as of ______ 1, 2022, is by and between the CITY OF RICHMOND, a charter city and municipal corporation, duly organized and existing under and by virtue of the laws of the State of California (the “City”), and U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION, a national banking association organized and existing under the laws of the United States of America, as trustee (the “Trustee”), as successor to Union Bank of California, N.A., supplement ing and amending that certain Indenture, dated as of November 1, 2005 (the “Original Indenture”), by and between the City and the Trustee. Capitalized terms used but not defined herein have the meanings given to such terms in the Original Indenture.

W I T N E S S E T H:

WHEREAS, the City is a contracting member of the California Public Employees’ Retirement System (the “System”), and as such the City is obligated to make certain payments to the System (the “PERS Obligation”);
WHEREAS, pursuant to Resolution No. 35-05, adopted by the City Council of the City (the “City Council ”) on March 29, 2005 (the “2005 Authorizing Resolution ”), the City Council authorized, among other things, the issuance by the City of pension funding bonds (the “Series 2005 Bonds”) for the purpose of refunding its PERS Obligation and additional pension funding bonds in the future from time to time for similar purposes (“Additional Bonds”), and interest rate swaps or swaptions (the “Swap Agreements”) in connection with any such bonds pursuant to Section 5922 of the California Government Code for the purpose of lowering the cost of borrowing; WHEREAS, pursuant to the 2005 Authorizing Resolution, the City Council also authorized the institution of a proceeding for ju dicial validation of the Series 2005 Bonds, the Additional Bonds, the Indenture and the Swap Agreements therefor in the Superior Court of Contra Costa County, under and pursuant to the provisions of Sections 860 et seq. of the California Code of Civil Procedure (the “Validation Proceeding”);
WHEREAS, a default judgment was entered in the Validation Proceedi ng on May 25, 2005, to the effect that, among other things, the Series 2005 Bonds, the Additional Bonds, the Indenture, and the Swap Agreements are valid and legal obligations of the City; WHEREAS, for the purpose of refunding a portion of the City’s PERS Obligation, the City subsequently issued the Series 2005 Bonds in three separate series as follows pursuant to the Original Indenture: (i) City of Richmond Taxable Pension Funding Bonds, Series 2005A (the “Series 2005A Bonds ”); in the initial principal am ount of $26,530,000, (ii) City of Richmond Taxable Pension Funding Bonds, Series 2005B -1 (the “Series 2005B-1 Bonds”), in the initial principal amount of $47,061,960; and (iii) City of Richmond Taxable Pension Funding Bonds, Series 2005B-2 (the “Series 2005B-2 Bonds”), in the initial principal amount of $47,061,960; WHEREAS, the Series 2005A Bonds matured in full on August 1, 2013, and are no longer outstanding;
WHEREAS, the Series 2005B -1 Bonds are outstanding in the principal amount of $17,899,000, have a final maturity date of August 1, 2023, and bear interest at a variable rate;

2 WHEREAS, the Series 2005B -2 Bonds were issued as Convertible A uction Rate Securities, are accreting interest (with a full accretion date of August 1, 2023, at which time the full accreted principal amount thereof will be $127,968,000), and a final maturity date of August 1, 2034;
WHEREAS, in an effort to lower the cost of borrowing of the Series 2005B-1 Bonds and the Series 2005B-2 Bonds (collectively, the “Series 2005B Bonds”) and in compliance with Section 5922 of the California Government Code, the City entered into an interest rate swap pursuant to an ISDA Master Agreement, together with the schedule and confirmations thereto (the “2016 Swap Agreement”), between the City and the Royal Bank of Canada (“RBC”), pursuant to which the variable rate of interest on the Series 2005B Bonds was exchanged for a fixed rate of interest; WHEREAS, the portion of the 2016 Swap Agreement relating to the Series 2005B -2 Bonds is subject to mandatory termination on August 1, 2023; WHEREAS, the Original Indenture provides that the City may at any time issue Additional Bonds (in addition to the Series 2005 Bonds) on a parity with the Series 2005 Bonds for the purpose, among others, of refunding any outstanding Series 2005 Bonds, including payment of all costs incidental to or connected with such refunding, upon compliance with the procedures set forth in Article III of the Original Indenture;
WHEREAS, the City is authorized under the provisions of Articles 10 and 11 of Chapter 3 of Part 1 of Division 2 of Title 5 of the California Government Code, commencing with Section 53570 of said Code (the “Act”), to issue its bonds for the purpose of refunding certain outstanding obligations of the City, including all or a portion of the outstanding Series 2005B Bonds and paying the Termination Fee (as hereinafter defined);
WHEREAS, the City has determined that it is in the best interest of the City and the public to refund all of the outstanding Series 2005B Bonds, terminate the 2016 Swap Agreement with respect to all of the Series 2005B Bonds and pay the related termination fee (the “Termination Fee”) in connecti on with the termination of the 2016 Swap Agreement for such bonds (the “Termination”);
WHEREAS, to that end, the City desires to issue its Taxable Pension Refunding Bonds, Series 2022 (the “Series 2022 Bonds”) to refund all of the outstanding Series 2005B Bonds, pay the Termination Fee, and pay the costs of issuing the Series 2022 Bonds; WHEREAS, the City desires to provide for the issuance of the Series 2022 Bonds and to provide the terms of the Series 2022 Bonds by amending the Original Indenture pursuant to this First Supplemental Indenture;

WHEREAS, as of the date hereof, no Insurance Policies are in effect with respect to any Bonds;

WHEREAS, the City previously issued its City of Richmond Taxable Limited Obligation Pension Bonds, 1999 Series A (the “1999 Bonds”), pursuant to a Trust Agreement dated as of November 1, 1999 (the “1999 Indenture”), between the City and U.S. Bank Trust Company, National Association, as successor trustee to U.S. Bank Trust National Association; WHEREAS, contemporaneous with the execution and delivery of this First Supplemental Indenture, the City has caused certain funds to be irrevocably deposited in an escrow fund held

3 by U.S. Bank Trust Company, National Association, as escrow agent, for the purpose of paying principal and interest when due on the outstanding 1999 Bonds and, as a result, such 1999 Bonds are no longer outstanding within the meaning of the 1999 Indenture and the lien on the Pension Tax Override Revenues pledged therefor under the 1999 Indenture has been discharged; WHEREAS, pursuant to Section 5451 of the Government Code of the State, the Series 2022 Bonds shall be secured by a pledg e of, and lien and security interest in, all of the City’s rights, title and interest in the Pledged Pension Tax Override Revenues; WHEREAS, the City has authorized the execution and delivery of this First Supplemental Indenture and has determined that all acts and proceedings required by law necessary to make the Series 2022 Bonds, when executed by the City and authenticated and delivered by the Trustee hereunder, valid, binding and legal obligations of the City payable in accordance with their terms, and to constitute this First Supplemental Indenture a valid and binding agreement of the parties hereto for the uses and purposes herein set forth in accordance with its terms, have been done and taken, and the execution and delivery of this First Supplemental Indenture has been in all respects duly authorized;

NOW, THEREFORE, the City and the Trustee do hereby agree that the Original Indenture is hereby amended by adding thereto an additional Article, as follows:

ARTICLE XI

SERIES 2022 BONDS

Section 11.01. Definitions. Unless the context otherwise requires, the terms defined in this Section shall for all purp oses of this Indenture and of any certificate, opinion or other document herein or therein mentioned, have the meanings herein specified. Capitalized terms used but not defined in this Section shall have the meanings given thereto in Section 1.01 of this Indenture.

“Escrow Agreement” means the Escrow Deposit and Trust Agreement, dated as of _______ 1, 2022, between the City and the Escrow Bank.

“Escrow Bank” means U.S. Bank Trust Company, National Association, as Escrow Bank and trustee for the Series 2005B Bonds.

“First Supplemental Indenture” means this First Supplemental Indenture, dated as of ______ 1, 2022, by and between the City and U.S. Bank Trust Company, National Association, as Trustee.

“RBC” means the Royal Bank of Canada.

“Series 2022 Bonds” means the City of Richmond Taxable Pension Refunding Bonds, Series 2022 in the original aggregate principal amount of $_______.

“Series 2022 Bonds Actuarial Valuation” means the [Pension Override Tax Study for Fiscal years 2021/22 and 2022/23] dated ______, 2022, prepared by Bartel Associates, LLC.

4 “Series 2022 Bonds Applicable Percentage ” has the meaning given to such term in Section 11.03 of this First Supplemental Indenture.

“Series 2022 Closing Date” means the date upon which the Series 2022 Bonds are delivered to the Series 2022 Original Purchasers, being [Closing Date].

“Series 2022 Continuing Disclosure Certificate ” means the Continuing Disclosure Certificate, dated as of the date hereof, of the City, as originally executed and as it may be amended from time to time in accordance with the terms thereof.

“Series 2022 Original Purchasers” means, collectively, Loop Capital Markets LLC and Hilltop Securities Inc., as the original purchasers of the Series 2022 Bonds from the City.

“Series 2022 Participating Underwriters ” has the meaning ascribed to the term “Participating Underwriter” in the Series 2022 Continuing Disclosure Certificate.

“Series 2022 Refunding Fund” means the fund by that name established and maintained by the Trustee under Section 11.05(a) hereof.

“Termination Fee” means the termination fee in the amount of $_____ payable by the City on the Series 2022 Closing Date to RBC in connection with the termination of the 2016 Swap Agreement with respect to the Series 2005B Bonds.

“2016 Swap Agreement” means, collectively, the ISDA Master Agreement, together with the schedule and confirmations thereto, between the City and RBC.

Section 11.02. Authorization of Series 2022 Bonds. The City has reviewed all proceedings heretofore taken relative to the authorization of the Series 2022 Bonds and has found, as a result of such review, and hereby finds and determines that all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in the issuance of the Series 2022 Bonds do exist, have happened and have been performed in due time, form and manner as required by law, and that the City is now duly authorized, pursuant to each and every requirement of the Act, to issue the Series 2022 Bonds in the form and manner and for the purpose provided herein and that the Series 2022 Bonds shall be entitled to the benefit, protection and security of the provisions of the Indenture.

Section 11.03. Terms of Series 2022 Bonds. The Series 2022 Bonds shall be designated “City of Richmond Taxable Pension Refunding Bonds, Series 2022.” The aggregate principal amount of Series 2022 Bonds that may be issued and Outstanding under this Indenture shall not exceed _________ Dollars ($_________), except as may be otherwise provided in Section 2. 11. As set forth in the Series 2022 Bonds Actuar ial Valuation, the Applicable Percentage for the Series 2022 Bonds as of the Series 2022 Closing Date (the “Series 2022 Bonds Applicable Percentage”) is set forth on Appendix N hereto.

The Series 2022 Bonds shall be issued as Standard Bonds and in the aggregate principal amount of _________ Dollars ($_________). The Series 2022 Bonds shall be dated the Series 2022 Closing Date, shall be issued only in fully registered form in Authorized Denominations of $5,000 principal amount or any integral multiple thereof, and shall mature on the dates and in the amounts and bear interest at the rates as set forth in the following schedule as provided herein:

Maturity Date Principal Interest

5 ([January 15]) Amount Rate

T: Denotes Series 2022 Bonds that are Term Bonds.

(d) The Interest Payment Dates with respect to the Series 2022 Bonds shall be [January 15 and July 15] of each year, commencing [July 15, 2023].

(e) The Series 2022 Bonds shall bear interest at the rates (based on a 360-day year of twelve 30-day months) set forth above, payable on the Interest Payment Dates for the Series 2022 Bonds. The Series 2022 Bonds shall bear interest from the Interest Payment Date next preceding the date of authentication thereof, unless (i) a Series 2022 Bond is authenticated on or before an Interest Payment Date and after the close of business on the preceding Record Date, in which event it shall bear interest from such Interest Payment Date, or (ii) a Series 2022 Bond is authenticated on or before the first Record Date, in which event interest thereon shall be payable from the Series 2022 Closing Date; provided, however, that if at the time of authentication of any Series 2022 Bond interest is then in default on the Outstanding Series 2022 Bonds, such Series 2022 Bond shall bear interest from the Interest Payment Date to which interest has previously been paid or made available for payment on the Outstanding Series 2022 Bonds.

Payment of interest on the Series 2022 Bonds due on or before the maturity or prior redemption thereof shall be made to the person whose name appears in the registration books kept by the Trustee pursuant to Section 2.08 hereof as the Holder thereof as of the close of business on the Record Date for an Interest Payment Date, whether or not such day is a Business Day, such interest to be paid by check mailed on the Interest Payment Date by first-class mail to such Holder at the address as it appears in such books; provided that upon the written request of an Holder of $1,000,000 or more in aggregate Principal Amount of Series 2022 Bonds received by the Trustee prior to the applicable Record Date, interest shall be paid by wire transfer in immediately available funds. Any such written request shall remain in effect until rescinded in writing by the Holder.

(f) The principal of and premium, if any, on the Series 2022 Bonds shall be payable in lawful money of the United States of America at the Corporate Trust Office of the Trustee.

Payment of the principal of and premium, if any, on the Series 2022 Bonds shall be made upon the surrender thereof at maturity or on redemption prior to maturity at the Corporate Trust Office of the Trustee.

(g) The Series 2022 Bonds shall be subject to redemption as provided in Section

11.07. Section 11.04. Form of Series 2022 Bonds. The Series 2022 Bonds and the authentication endorsement and assignment to appear thereon shall be substantially in the form

6 set forth in Exhibit M attached hereto, with appropriate or necessary insertions, omissions and variations as permitted or required hereby. Each Series 2022 Bond shall bear the letter prefix “R- __” and be numbered consecutively upward.

Section 11.05. Procedure for the Issuance of Series 2022 Bonds; Application of Series 2022 Bond Proceeds. At any time after the sale of the Series 2022 Bonds in accordance with the Act, the City shall execute the Series 2022 Bonds for issuance under this Indenture and shall deliver them to the Trustee, and thereupon the Series 2022 Bonds shall be authenticated and delivered by the Trustee upon the Written Request of the City and upon receipt of payment therefor from the Series 2022 Original Purchasers. Upon receipt of payment for the Series 2022 Bonds from the Series 2022 Original Purchasers, the Trustee shall set aside and deposit the proceeds received from such sale in the amount $______ (representing the original principal amount thereof of $_______, less an underwriters’ discount of $______) as follows:

(a) The Trustee shall deposit $_______ from the proceeds of the Series 2022 Bonds in the Series 2022 Refunding Fund, which fund the Trustee is hereby directed to establish. On the Series 2022 Closing Date, the Trustee shall promptly transfer all amounts in the Series 2022 Refunding Fund to the Escrow Bank to be applied to the refunding of the outstanding Series 2005B Bonds as provided in the Escrow Agreement.

Once the Trustee has made such transfer, it shall close the Series 2022 Refunding Fund.

(b) The Trustee shall transfer $______ from the proceeds of the Series 2022 Bonds, to RBC, which shall constitute the Termination Fee associated with the termination of the 2016 Swap Agreement.

(c) The Trustee shall deposit $_______ in the 2022 Costs of Issuance Fund, which fund the Trustee is hereby directed to establish . All money in the 2022 Costs of Issuance Fund shall be used and withdrawn by the Trustee to pay or reimburse the Costs of Issuance of the Series 2022 Bonds upon receipt of a Written Request of the City filed with the Trustee, each of which shall be sequentially numbered and shall state the person to whom payment is to be made, the amount to be paid, the purpose for which the obligation was incurred and that such payment is a proper charge against said fund. On _______, 2022, or upon the earlier Written Request of the City, any remaining balance in the 2022 Costs of Issuance Fund shall be transferred to the Bond Fund and applied to the payment of interest on the Series 2022 Bonds next coming due and payable. Thereafter, the 2022 Costs of Issuance Fund shall be closed.

Section 11.06. Book-Entry System for the Series 2022 Bonds. (a) Except as otherwise provided in subsections (b) and (c) of this Section, the Series 2022 Bonds shall initially be issued in the form of a single authenticated fully registered bond for each Principal Payment Date of each Series of t he Series 2022 Bonds, and shall be registered in the name of Cede & Co., as nominee for DTC, or such other nominee as DTC shall request pursuant to the Representation Letter. Payment of the interest on any Series 2022 Bond registered in the name of Cede & Co. shall be made on each Interest Payment Date for such Series 2022 Bonds to the account, in the manner and at the address indicated in or pursuant to the Representation Letter.

(b) The Trustee and the City may treat DTC (or its nominee) as the sole and exclusive owner of the Series 2022 Bonds registered in its name for the purposes of payment of the principal or redemption price of and the interest on such Series 2022 Bonds, selecting the Series 2022 Bonds or portions thereof to be redeemed, giving any notice permitted or required to be given to Holders hereunder, registering the transfer of the Series 2022 Bonds, obtaining any consent or

7 other action to be taken by Holders of the Series 2022 Bonds and for a ll other purposes whatsoever, and neither the Trustee nor the City shall be affected by any notice to the contrary.

Neither the Trustee nor the City shall have any responsibility or obligation to any Participant (which shall mean, for purposes of this Section, securities brokers and dealers, banks, trust companies, clearing corporations and other entities, some of whom directly or indirectly own DTC), any person claiming a beneficial ownership interest in the Series 2022 Bonds under or through DTC or any Participant, or any other person which is not shown on the registration records as being a Holder, with respect to (i) the accuracy of any records maintained by DTC or any Participant, (ii) the payment by DTC or any Participant of any amount in respect of the principal or redemption price of or the interest on any of the Series 2022 Bonds, (iii) any notice which is permitted or required to be given to Holders of Series 2022 Bonds hereunder, or (iv) any consent given or other action taken by DTC as Holder of Series 2022 Bonds. The Trustee shall pay the principal or redemption price of and the interest on the Series 2022 Bonds only at the times, to the accounts, at the addresses and otherwise in accordance with the Representation Letter, and all such payments shall be valid and effective to satisfy fully and discharge the City's obligations with respect to the Series 2022 Bonds to the extent of the sum or sums so paid. Upon delivery by DTC to the Trustee of written notice to the effect that DTC has determined to substitute a new nominee in place of its then existing nominee, the Series 2022 Bonds will be transferable to such new nominee in accordance with subsection (f) of this Section.

(c) In the event that the City determines that it is in the best interests of the Beneficial Holders of the Series 2022 Bonds that they be able to obtain definitive Series 2022 Bonds, the Trustee shall, upon receipt of a Written Request of the City, so notify DTC, whereupon DTC shall notify the Participants of the availability through DTC of definitive Series 2022 Bonds, and in such event the Series 2022 Bonds shall be transferable in accordance with subsection (f) of this Section. DTC may determine to discontinue providing its services with respect to the Series 2022 Bonds at any time by giving written notice of such discontinuance to the Trustee or the City and discharging its responsibilities with respect thereto under applicable law, and in such event the Series 2022 Bonds shall be transferable in accordance with subsection (f) o f this Section.

Whenever DTC requests the Trustee or the City to do so, the Trustee and the City will cooperate with DTC in taking appropriate action after reasonable notice to arrange for another Securities Depository to maintain custody of all certificat es evidencing the Series 2022 Bonds then Outstanding, and in such event the Series 2022 Bonds shall be transferable to such Securities Depository in accordance with subsection (f) of this Section, and thereafter, all references in this Indenture to DTC or its nominee shall be deemed to refer to such successor Securities Depository and its nominee, as appropriate.

(d) Notwithstanding any other provision hereof to the contrary, so long as all Series 2022 Bonds Outstanding are registered in the name of any nominee of DTC, all payments with respect to the principal or redemption price of and the interest on each such Series 2022 Bond and all notices with respect to each such Series 2022 Bond shall be made and given, respectively, to DTC as provided in the Representation Letter.
(e) The Trustee and the City are each hereby authorized and requested to execute and deliver the Representation Letter and, in connection with any successor nominee for DTC or any successor depository, enter into comparable arrangements, and shall have the same rights with respect to its actions thereunder as it has with respect to its actions hereunder.

(f) In the event that any transfer or exchange of Series 2022 Bonds is authorized under subsection (b) or (c) of this Section, such transfer or exchange shall be accomplished upon receipt by the Trustee from the registered owner thereof of the Series 2022 Bonds to be transferred or exchanged and appropriate instruments of transfer to the permitted transferee, all

8 in accordance with the applicable provisions of Sections 2.08(a) and 2.09 hereof. In the event that definitive Series 2022 Bonds are issued to Holders other than Cede & Co., its successor as nominee for DTC as Holder of all the Series 2022 Bonds, another Securities Depository as holder of all the Series 2022 Bonds, or the nominee of such successor Securities Depository, the provisions of Sections 2.08(a), 2.09, and 2.10 hereof shall also apply to, among other things, the registration, exchange and transfer of the Series 2022 Bonds and the method of payment of the principal or redemption price of and the interest on the Series 2022 Bonds.

Section 11.07. Redemption of Series 2022 Bonds. (a) Make-Whole Optional Redemption. The Series 2022 Bonds are subject to optional redemption prior to their stated maturity dates at the option of the City, in whole or in part, in such order of maturity as may be designated by the City and on a pro rata pass -through distribution of principal basis within any maturity, on any date, prior to [January 15], 20__, at a redemption price (the ”Make-Whole Redemption Price”) equal to the greater of:

(i) the issue price of 100% of the principal amount of such Series 2021 Bonds to be redeemed; or

(ii) the sum of the present value of the remaining scheduled payments of principal and interest to the maturity date of the Series 2022 Bonds to be redeemed, not including any portion of those payments of interest accrued and unpaid as of the date on which the Series 2022 Bonds are to be redeemed, discounted to the date on which the Series 2022 Bonds are to be redeemed on a semi-annual basis, assuming a 360-day year consisting of twelve 30-day months, at the Treasury Rate, plus __ basis points;

plus, in each case, accrued interest on the Series 2022 Bonds to be redeemed to the redemption date.

“Treasury Rate” means, with respect to any redemption date for a particular Series 2022 Bond, the yield to maturity as of such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available on a date selected by the City that is at least 2 Business Days, but not more than 45 calendar days, prior to the redemption date (excluding inflation indexed securities) (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to the maturity date of the Series 2022 Bonds to be redeemed; provided, however, that if the period from the redemption date to such maturity date is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used.

The Make-Whole Redemption Price shall be determined by an independent accounting firm or financial advisor retained by the City and such accounting firm or financial advisor shall perform all actions and make all calculations required to determine the Make-Whole Redemption Price. The Trustee and the City may conclusively rely on such accounting firm’s or financial advisor’s calculations in connection with, and determination of, the Make -Whole Redemption Price, and shall bear no liability for such reliance.

(b) Par Call Optional Redemption. The Series 2022 Bonds maturing on and after January 15, 20__, will no longer be subject to redemption at the Make-Whole Redemption Price on and after such date, and shall be subject to optional redemption, in whole or in part (and if in part, as described in Section 11.09), on any date on or after [January 15], 20__, at the option of

9 the City, from any source of legally available funds, at a redemption price equal to the Principal Amount of the Series 2022 Bonds to be redeemed, plus accrued interest thereon to the date of redemption, without premium.

(c) Mandatory Sinking Fund Redemption . The Series 2022 Bonds maturing on [January 15], 20__ shall be subject to mandatory sinking fund redemption, in part (as described in Section 11.09), on [January 15] in each year, commencing [January 15], 20__, at a redemption price equal to the Principal Amount of such Series 2022 Bonds to be redeemed, without premium, plus accrued interest thereon to the date of redemption, in the aggregate respective Principal Amounts in the respective years as follows:

Sinking Fund
Redemption Date
([January 15])
Principal Amount
to be Redeemed

(Maturity)

If some but not all of the Series 2022 Bonds maturing on [January 15], 20__ are redeemed pursuant to Section 11.07(a), the Principal Amount of Series 2022 Bonds maturing on [January 15], 20__ to be subsequently redeemed pursuant to this subsection shall be reduced by the aggregate Principal Amount of the Series 2022 Bonds maturing on [January 15], 20 __ so redeemed pursuant to Section 11.07(a), such reduction to be allocated among redemption dates in Authorized Denominations, as designated by the City in a Written Certificate of the City filed with the Trustee.

Section 11.08. Notice of Redemption for Series 2022 Bonds. Notwithstanding Section

10.06, the Trustee shall mail notice of redemption of the Series 2022 Bonds by first class mail, postage prepaid, not less than 20 nor more than 60 days before any redemption date, to the respective Holders of any Series 2022 Bonds designated for redemption at their addresses appearing on the registration books maintained by the Trustee pursuant to Section 2.10 and to one or more Securities Depositories and to the Municipal Securities Rulemaking Board. Each notice of redemption shall state the date of the notice, the redemption date, the place or places of redemption, whether less than all of the Series 2022 Bonds (or all Series 2022 Bonds of a single maturity) are to be redeemed, the CUSIP numbers and (in the event that not all Series 2022 Bonds within a maturity are called for redemption) Bond numbers of the Series 2022 Bonds to be redeemed and the maturity or maturities of the Series 2022 Bonds to be redeemed, and in the case of Series 2022 Bonds to be redeemed in part only, the respective portions of the principal amount thereof to be redeemed. Each such notice shall also state that on the redemption date there will become due and payable on each of said Series 2022 Bonds the redemption price thereof, and that from and after such redemption date interest thereon shall cease to accrue, and shall require that such Series 2022 Bonds be then surrendered to the Trustee. Neither the failure to receive any notice nor any defect therein shall affect the sufficiency of the proceedings for such redemption or the cessation of accrual of interest from and after the redemption date. Notice of redemption of Series 2022 Bonds shall be given by the Trustee, at the expense of the City, for and on behalf of the City.

Redemption notices may be conditional. The City has the right to rescind any notice of the redemption of Series 2022 Bonds under Section 11.07 by written notice to the Trustee on or prior

10 to the dated fixed for redemption. Any notice of redemption shall be cancelled and annulled if for any reason funds will not be or are not available on the date fixed for redemption for the payment in full of the Series 2022 Bonds then called for redemption, and such cancellation shall not constitute an Event of Default. The City and the Trustee have no liability to the Holders of Series 2022 Bonds or any other party related to or arising from such rescission of redemption. The Trustee shall mail notice of such rescission of redemption in the same manner as the original notice of redemption was sent under this Section. In the event Series 2022 Bonds that are Term Bonds are redeemed in part, the City shall deliver a revised sinking fund schedule to the Trustee.

Section 11.09. Selection of Series 2022 Bonds for Redemption. If less than all of the Series 2022 Bonds of a maturity are to be redeemed prior to maturity, including by Mandatory Sinking Account Payments as described above, then:

(a) If the S eries 2022 Bonds are registered in book-entry only form and so long as DTC or a successor Securities Depository is the sole registered owner of the Series 2022 Bonds, the particular Series 2022 Bonds shall be redeemed on a “Pro Rata Pass-Through Distribution of Principal” basis in accordance with the process described below. The Trustee will send notice to DTC or a successor Securities Depository to effect a pro rata reduction of principal of all applicable Series 2022 Bonds to accomplish the optional and mandatory sinking fund redemptions pursuant to Section 11.07 through a pass-through distribution of principal. In connection with each such redemption, the Trustee will include in the written notice of redemption described above the dollar amount per $1,000 original principal amount payable on account of principal and accrued interest to effect a pro rata reduction through a pass -through distribution of principal on the related redemption date, as well as the pro rata method factors applicable to such redemption. DTC or a successor Securities Depository will be responsible for distributing the principal and accrued interest among its direct participants, as applicable, based upon the Series 2022 Bonds being redeemed to the beneficial interests of the direct participant that DTC or a successor Securities Depository records list as owned by each direct participant of DTC or a successor Securities Depository as of the record date for such payment. If less than all of the Series 2022 Bonds are called for redemption, the Trustee will direct that the accrued interest due on the portion of the Series 2022 Bonds being redeemed be calculated and paid based on the amount of principal being redeemed on such redemption date. After the date fixed for redemption no further interest will accrue on the principal amount being called for redemption.

(b) If the operational arrangements of DTC or a successor Securities Depository do not allow for allocation of such redemption on a pro rata pass -through distribution of principal basis, the portion of the Series 2022 Bonds to be redeemed on such dates will be selected in accordance with the Depository’s then existing rules and procedures and may be by lot.

(c) If the Series 2022 Bonds are not then in book -entry form at the t ime of such redemption, on each redemption date, the Trustee may select the Series 2022 Bonds for redemption pro rata within a maturity. The Trustee will select such portions of Series 2022 Bonds to be redeemed in such manner as the Trustee may deem to be fair and appropriate.

Section 11.10. Continuing Disclosure. The City shall comply with and carry out all of the provisions of the Series 2022 Continuing Disclosure Certificate. Notwithstanding any other provision of this Indenture, failure of the City to comply with the Series 2022 Continuing Disclosure Certificate shall not be considered an Event of Default; provided, however, that the Trustee may (and, at the written direction of any Series 2022 Participating Underwriter or the holders of at least 25% aggregate Principal Amount of Outstanding Series 2022 Bonds, and upon indemnification of the Trustee to its reasonable satisfaction, shall) or any Holder or Beneficial Owner of the Series

11 2022 Bonds may, take such actions as may be necessary and appropriate to compel performance, including seeking mandate or specific performance by court order.

Section 11.11. Amendments to Original Indenture. The Original Indenture is hereby amended as follows:

(a) The following defined terms set forth in Section 1.01 of the Original Indenture are hereby amended to read in their entirety as follows:

Applicable Percentage

The term “Applicable Percentage ” means, for each Series of Bonds, the percentage of the then outstanding unfunded accrued actuarial liability of the City to the System to be funded from such Series of Bonds relating to City pension benefits at the levels in existence on June 30, 1978 (the “Pre-1978 Benefits”), and, in the case of Additional Bonds issued to refund Bonds then Outstanding, the percentage of the Pre - 1978 Benefits allocable thereto as determined by the City. In accordance with the report of Bartel Associates, LLC, dated June 21, 2005 and entitled “CalPERS Actuarial Issues “Cost: of Benefit Improvements Subsequent to July 1, 1978,” the City has determined that the Applicable Percentage is 86.13% with respect to the Series 2005 Bonds. The Applicable Percentage for the Series 2022 Bonds shall be the Series 2022 Bonds Applicable Percentage as set forth in Section 11.03 of the First Supplemental Indenture, and the Applicable Percentage for any Additional Bonds issued in the future shall be set forth in the Supplemental Indenture for each such series of Additional Bonds. For the avoidance of doubt, the Applicable Percentage for any Series of Bonds may fluctuate from Bond Year to Bond Year.

Bond Year

The term “Bond Year” means the twelve-month period ending on January 15 of each year to which reference is made. The first Bond Year with respect to the Series 2022 Bonds shall commence on the date the Series 2022 Bonds are originally delivered and shall end on January 15, 2023.

Interest Payment Date

The term “Interest Payment Date” means each date upon which interest is due on the Bonds (excepting Capital Appreciation Bonds and Convertible Auction Rate Securities, prior to the Full Accretion Date, and Convertible Capital Appreciation Bonds, prior to the Conversion Date), as initially set forth in Appendix J hereto with respect to the Series 2005 Bonds, and as set forth in the Supplemental Indenture for each series of Additional Bonds. The Series 2022 Bonds are being issued as Standard Bonds and Fixed Rate Bonds with Interest Payment Dates of [January 15 and July 15] of each year, commencing [July 15, 2023]. As of the Series 2022 Closing Date, no Capital Appreciation Bonds or Convertible Auction Rate Securities will be Outstanding hereunder.

Principal Payment Date

The term “Principal Payment Date” means the date on which principal is due on the Bonds as set forth on Appendix J attached hereto with respect to the Series 2005 Bonds, and as set forth in the Supplemental Indenture for each series of Additional Bonds.

12 (b) Section 1.01 of the Original Indenture is hereby amended by adding the following new defined terms to appear in alphabetical order therein:

Pledged Pension Tax Override Revenues

The term “Pledged Pension Tax Override Revenues” means, with respect to each Series of Bonds, the portion of the Pension Tax Override Revenues pledged therefor under this Indenture determined by multiplying (x) the Pension Tax Override Revenues, by (y) the Applicable Percentage for such Series of Bonds. Pledged Pension Tax Override Revenues for the Series 2022 Bonds are set forth in Appendix N.

Tax Override Pension Fund

The term “Tax Override Pension Fund” means the fund by that name held by the City.

Secured Annual Debt Service

The term “Secured Annual Debt Service” means, for each Series of Bonds, with respect to any Bond Year, the product obtained by multiplying (x) the aggregate amount required to pay principal of and interest on and the redemption price of such Series of Bonds during such Bond Year, by (y) the Applicable Percentage for such Series of Bonds for such Bond Year, in each case as set forth in the Supplemental Indenture for such Series of Bonds. The Secured Annual Debt Service for the Series 2022 Bonds is set forth in Appendix N.

(d) Section 4.01 of the Original Indenture is hereby amended to read in its entirety as follows:

SECTION 4.01. Security for the Bonds.

(a) The obligations of the City under the Bonds, including the obligation to make all payments of principal of and interest on the Bonds when due and the obligation of the City to make the deposits required hereunder for the security of the Bonds, are obligations of the City imposed by law and are absolute and unconditional, without any right of set-off or counterclaim.

The City agrees to pay from any legally available source of revenues of the City, including amounts on deposit in the General Fund of the City, all amounts due and owing with respect to Bonds issued under this Indenture and all Supplemental Indentures executed pursuant to this Indenture according to the provisions for such agreements, including principal and interest thereon and the redemption price thereof.

In addition, subject to the provisions of Section 4.01(b) and (c) hereof regarding the application of Pledged Tax Override Revenues for the payment of debt service on the Bonds, for the security of the Series 2022 Bonds and any Additional Bonds issued in the future, the City hereby grants a first pledge of and lien on, and a security interest in, the Pledged Pension Tax Override Revenues; provided, however, that such pledge, lien and security interest for any Bond Year shall under no circumstances exceed the Secured

13 Annual Debt Service applicable to the Series 2022 Bonds and each series of Additional Bonds.

In addition, the Series 2022 Bonds and any Additional Bonds shall be secured by a first pledge of and lien on, and a security interest in, all of the moneys on deposit in the Bond Fund; provided, however, that such pledge, lien and security interest shall under no circumstances exceed the Secured Annual Debt Service applicable to the Series 2022 Bonds and each series of Additional Bonds.

In consideration of the acceptance of the Bonds by those who hold the same from time to time, this Indenture constitutes a contract between the City and the Holders from time to time of the Bonds, and the covenants and agreements herein set forth to be performed on behalf of the City are for the equal and proportionate benefit, security and protection of all Holders of the Bonds w ithout preference, priority or distinction as to security or otherwise of any of the Bonds over any of the others by reason of the number or date thereof or the time of sale, execution and delivery thereof, or otherwise for any cause whatsoever, except as expressly provided therein or herein.

The Bonds do not constitute an obligation of the City for which the City is obligated to levy or pledge any form of taxation, except the Pension Tax Override but only to the extent set forth in Section 5.10 hereof. Neither the Bonds nor the obligations of the City to make payments on the Bonds constitute an indebtedness of the City, the State of California, or any of its political subdivisions within the meaning of any constitutional or statutory debt limitation or restriction.

(b) The City has established the Tax Override Pension Fund, which is held by the City. The City shall deposit all of the Pension Tax Override Revenues received with respect to any Bond Year into the Tax Override Pension Fund promptly upon receipt thereof by the City.

All Pledged Pension Tax Override Revenues received by the City during any Bond Year in excess of the Annual Secured Debt Service shall be released from the pledge, security interest and lien under this Indenture for security of the Series 2022 Bonds and any Additional Bonds and may be applied by the City for any lawful purpose of the City.

(c) The Trustee shall establish and maintain a special fund designated as the “Bond Fund” and within the Bond Fund an account designated as the “Retirement Tax Special Revenue Account,” which fund and account are hereby created and shall be held in trust by the Trustee.

On or before the 5 th Business Day preceding each Payment Date, the City shall transfer to the Trustee for deposit in the Bond Fund (and, at the direction of the City, the Retirement Tax Special Revenue Account as described in the following sentence) an amount which, when added to the amount then on deposit in the Bond Fund (and the Retirement Tax Special Revenue Account), when added with amounts on deposit in the Interest Account and the Principal Account, equals the aggregate amount of the interest and principal coming due and payable on the Outstanding Bonds on the immediately following Payment Date. Without limiting the foregoing, the Trustee shall deposit all of the Pledged Pension Tax Override Revenues received from, and designated as such by, the City with respect to any Bond Year into the Retirement Tax Special Revenue Account promptly upon receipt thereof by the Trustee. All money in the Retirement Tax Special

14 Revenue Account shall be transferred by the Trustee to the Interest Account and the Principal Account pursuant to Sections 4.02(a) and 4.02(b) solely for the purpose of paying interest and principal as provided therein on the Series 2022 Bonds and any Additional Bonds in an amount not to exceed the applicable Annual Secured Debt Service for the Series 2022 Bonds and any Additional Bonds.

If, at any time, there is a deficiency in Pledged Tax Override Revenues available to pay debt service with respect to any Series of Bonds in any Bond Year , available Pledged Tax Override Revenues shall be applied on a pro rata basis to the payment thereof; provided, however, that under no circumstances shall the amount available therefor with respect each Series of Bonds exceed the Applicable Percentage therefor.

(d) The proviso in Section 5.02 of the Original Indenture is hereby amended to read as follows:

“:provided, that nothing in this section shall be deemed to limit the right of the City to issue bonds for the purpose of refunding any Outstanding Bonds and any bonds issued for such purpose, including Additional Bonds issued to refund any Outstanding Bonds or to satisfy any obligation of the City to make payments to the System pursuant to the Retirement Law as provided in Section 3.01(b) hereof, shall not be deemed to constitute an extension of maturity of any such Bonds , it being expressly acknowledged that any such refunding bonds, including Additional Bonds, may have a final maturity that is later in time than the bonds refunded or obligations of the City to make payments to the System satisfied thereby.”

(e) Section 5.08 of the Original Indenture is hereby amended to read in its entirety as follows:

SECTION 5.08. No Senior Pension Override Secured Debt; Issuance of Subordinated Debt. The City hereby covenants that, so long as the Series 2022 Bonds or any Additional Bonds are Outstanding, the City shall not issue any bonds, notes or other obligations, enter into any agreement or otherwise incur any indebtedness (collectively, “Indebtedness”), which is in any case payable from all or any part of the Pledged Pension Tax Override Revenues, except (i) the Series 2022 Bonds, (ii) Additional Bonds issued or incurred pursuant to Article III hereof, (iii) Indebtedness payable from, but not secured by a pledge of or lien upon Pledged Pension Tax Override Revenues, and (iv) Indebtedness secured by a pledge of or lien on any Pledged Pension Tax Override Revenues which is subordinate to the pledge and lien which secures the Series 2022 Bonds and any Additional Bonds.

(f) Article V of the Original Indenture is hereby amended by adding the following new Section 5.10:

SECTION 5.10. Pension Tax Override Levy. The City covenants that, so long as any Series 2022 Bonds or any Additional Bonds are Outstanding under this Indenture, the City shall levy the Pension Tax Override (in an amount not to exceed the maximum tax permitted by law) in each Fiscal Year, whether or not the accrued unfunded actuarial liability of the City to the System is amortized prior to the final maturity of any Series 2022 Bonds or any Additional Bonds issued pursuant to this Indenture, in amounts that the City expects will be sufficient, when aggregated with any Pension Tax Revenues available to the City and on hand, to pay principal of and interest on and redemption price, if any, of

15 the Series 2022 Bonds and Additional Bonds in an amount not to exceed the Series 2022 Bonds Applicable Percentage and the Applicable Percentage for each such Additional Bonds as set forth in the Supplemental Indenture for such Additional Bonds, respectively.

(g) Section 8.01 of the Original Indenture is hereby amended by adding the following new paragraph immediately after the existing last paragraph thereof:

Notwithstanding anything contained herein to the contrary, under no circumstances shall the amount of Pledged Tax Override Revenues available to pay debt service on any Series of Bonds pursuant to this Section 8.01 exceed the Applicable Percentage therefor. If, at any time, there is a deficiency in Pledged Tax Override Revenues available to pay debt service with respect to any Series of Bonds, available Pledged Tax Override Revenues shall be applied on a pro rata basis to the payment thereof; provided, however, that under no circumstances shall the amount available therefor with respect each Series of Bonds exceed the Applicable Percentage therefor.

(h) Section 10.06 of the Original Indenture is hereby amended by deleting “thirty (30) days” and inserting “twenty (20) days” in place thereof.

(i) The address for notices to the Trustee set forth in Section 10.09 is hereby amended to read as follows:

If to the Trustee:

U.S. Bank Trust Company, National Association
[To come]

Section 11.12. Effect of First Supplemental Indenture . This First Supplemental Indenture and all of the terms and provisions herein contained shall form part of the Indenture as fully and with the same effect as if all such terms and provisions had been set forth in the Indenture. The Indenture is hereby ratified and confirmed and shall continue in full force and effect in accordance with the terms and provisions thereof, as amended hereby. If there shall be any conflict between the terms of this First Supplemental Indenture and the terms of the Indenture (as in effect on the day prior to the effective date of this First Supplemental Indenture), the terms of this First Supplemental Indenture shall prevail.

Section 11.13. Execution in Several Counterparts. This First Supplemental Indenture may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.

Section 11.14. Effective Date. This First Supplemental Indenture shall take effect upon the Series 2022 Closing Date.

[Signature Page Follows on Next Page]

S-1
IN WITNESS WHEREOF, the City has caused this First Supplemental Indenture to be signed in its name by its representative thereunto duly authorized, and the Trustee has caused this First Supplemental Indenture to be signed in its corporate name by its officer thereunto duly authorized, all as of the day and year first above written.

CITY OF RICHMOND

By:

Shasa Curl
City Manager

ATTEST:

Pamela Christian
City Clerk

APPROVED AS TO FORM:

Anita Luck
City Attorney

U.S. BANK TRUST COMPANY, NATIONAL

ASSOCIATION,
as Trustee

By:

Authorized Officer

M-1

APPENDIX M

FORM OF SERIES 2022 BOND

CITY OF RICHMOND

TAXABLE PENSION REFUNDING BONDS,
SERIES 2022

No. R- ***$***

Interest Rate Maturity Date Dated Date CUSIP
January 15, 20__ [Closing Date]

REGISTERED OWNER: CEDE & CO.

PRINCIPAL AMOUNT: ____________________ DOLLARS

The City of Richmond , a charter city and municipal corporation, duly organized and existing under and by virtue of the laws of the State of California (the “City”), for value received, hereby promises to pay to the registered owner identified above or registered assigns, on the maturity date specified above (subject to any right of prior redemption hereinafter provided for) the principal amount specified above, together with interest on such principal amount from the Interest Payment Date (as hereinafter defined) next preceding the date of authentication of this Bond (unless this Bond is authenticated as of an Interest Payment Date or during the period from the first day of the month of an Interest Payment Date to such Interest Payment Date, in which event it shall bear interest from such Interest Payment Date, or unless this Bond is authenticated prior to the first Interest Payment Date, in which event it shall bear interest from the dated date specified above) until the principal hereof shall have been paid at the interest rate per annum specified above, payable on [July 15, 2023], and semiannually thereafter on each [January 15] and [July 15] (each an “Interest Payment Date”). Interest due on or before the maturity or prior redemption of this Bond shall be payable only by check mailed on the Interest Payment Date by first-class mail to the registered owner hereof; provided that upon the written request of a registered owner of $1,000,000 or more in aggregate Principal Amount of Series 2022 Bonds received by the Trustee (as hereinafter defined) prior to the applicable record date, interest shall be paid by wire transfer in immediately available funds. The principal hereof is payable in lawful money of the United States of America at the Corporate Trust Office of the Trustee.

This Bond is one of a duly authorized issue of bonds of the City designated as “City of Richmond Taxable Pension Refunding Bonds, Series 2022” (the “Series 2022 Bonds”), issued in the aggregate principal amount of __________ Dollars ($__________). The Series 2022 Bonds are being issued under and pursuant to the provisions of Articles 10 and 11 (commencing with Section 53570) of Chapter 3 of Division 2 of Title 5 of the California Government Code (the “Act”) and under and pursuant to the provisions of an Indenture, dated as of November 1, 2005, by and between the City and U.S. Bank Trust Company, National Association, as successor trustee (the “Trustee”), as amended by the First Supplemental Indenture, dated as of ______ 1, 2022, by and between the City and the Trustee (as amended, modified or supplemented from time to time, the “Indenture”). C opies of the Indenture are on file at the Corporate Trust Office of the Trustee.

Capitalized undefined terms used herein shall have the meanings ascribed thereto in the Indenture.

M-2
The Series 2022 Bonds are being issued as Standard Bonds and constitute Additional Bonds under the Indenture. The Series 2022 Bonds have been issued by the City to refund all of the outstanding Series 2005B Bonds, pay the Termination Fee, and pay the costs of issuing the Series 2022 Bonds. Under the Indenture, Additional Bonds may be issued on a parity with the Series 2022 Bonds, but subject to the conditions and upon compliance with the procedures set forth in the Indenture. The Series 2022 Bonds and any such Additional Bonds are collectively referred to herein as the “Bonds.”

Reference is hereby made to the Act and to the Indenture and any and all amendments thereof and supplements thereto for a description of the terms on which the Series 2022 Bonds are issued, the rights of the registered owners of the Series 2022 Bonds, security for payment of the Series 2022 Bonds, remedies upon default and limitations thereon, and amendment of the Indenture (with or without consent of the registered owners of the Bonds); and all the terms of the Indenture are hereby incorporated herein and constitute a contract between the City and the registered owner of this Bond, to all the provisions of which the registered owner of this Bond, by acceptance hereof, agrees and consents.

The obligations of the City under the Bonds, including the obligation to make all payments of interest and principal when due, are obligations of the City imposed by law and are absolute and unconditional, without any right of set-off or counterclaim.

This Bond and the interest hereon and all Additional Bonds and the interest thereon are payable from any source of legally available funds of the City, including amounts on deposit in the General Fund of the City . In addition, this Bond and the interest hereon and all Additional Bonds and the interest thereon are payable from, and are secured by a lien and security interest in all right, title and interest of the City in and to , the Pledged Pension Tax Override Revenues and the funds and accounts provided for in the Indenture; provided, however, that such pledge, lien and security interest for any Bond Year shall under no circumstances exceed the Secured Annual Debt Service applicable to the Series 2022 Bonds and each series of Additional Bonds.

The Bonds do not constitute an obligation of the City for which the City is obligated to levy or pledge any form of taxation, except with respect to the Pension Tax Override and solely to the extent provided in the Indenture . Neither the Bonds nor the obligation of the City to make payments on the Bonds constitute an indebtedness of the City, the State, or any of its political subdivisions within the meaning of any constitutional or statutory debt limitation or restriction.

The Series 2022 Bonds are subject to redemption on the dates, at the redemption prices and pursuant to the terms set forth in the Indenture. Notice of redemption of any Series 2022 Bonds or any portions thereof shall be given as set forth in the Indenture.

This Bond may be transferred or exchanged pursuant to the terms set forth in the Indenture. The City and the Trustee may deem and treat the registered owner of this Bond as the absolute owner of this Bond for the purpose of receiving payment hereof and for all other purposes, whether this Bond shall be overdue or not, and neither the City nor the Trustee shall be affected by any notice or knowledge to the contrary.

The rights and obligations of the City and of the owners of the Bonds may be amended by a Supplemental Indenture entered into by the City and the Trustee, as provided in the Indenture.

M-3
This Bond shall not be entitled to any benefit, protection or security under the Indenture or become valid or obligatory for any purpose until the certificate of authentication and registration hereon endorsed shall have been executed and dated by the Trustee.

It is hereby certified that all acts, conditions and things required by law to exist, to have happened and to have been performed precedent to and in the issuance of this Bond do exist, have happened and have been performed in due time, form and manner as required by law.

Unless this Bond is presented by an authorized representative of The Depository Trust Company to the Trustee for registration of transfer, exchange or payment, and any Bond issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY

TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.

IN WITNESS WHEREOF, the City of Richmond has caused this Bond to be executed in its name and on its behalf by the manual or facsimile signature of the City Manager of the City of Richmond and attested to by the manual or facsimile signature of its Secretary.

CITY OF RICHMOND

By:

City Manager

Attest:

City Clerk

M-4

CERTIFICATE OF AUTHENTICATION

This is one of the Bonds described in the within -mentioned Indenture which has been authenticated on _______.

U.S. BANK TRUST COMPANY, NATIONAL

ASSOCIATION,
as Trustee

By:

Authorized Officer

M-5

ASSIGNMENT

For value received the undersigned hereby sells, assigns and transfers unto __________________________________, whose address and social security or other tax identifying number is ____________________, the within -mentioned Bond and hereby irrevocably constitute(s) and appoint(s) ______________________________, attorney, to transfer the same on the registration books of the Trustee with full power of s ubstitution in the premises.

Dated:

Signature Guaranteed:

Note: Signature guarantee shall be made
by a guarantor institution participating in the
Securities Transfer Agents Medallion
Program or in such other guarantee
program acceptable to the Trustee.

Note: The signature(s) on this Assignment
must correspond with the name(s) as written
on the face of the within Bond in every
particular without alteration or enlargement or
any change whatsoever.

N-1

APPENDIX N

SCHEDULE OF PLEDGED PENSION TAX OVERRIDE REVENUES FOR SERIES 2022 BONDS

Debt Service Attributable to
Refunding B-1s / B-2s
Debt Service Attributable to
Swap Terminations
Total Debt
Service
Secured
Annual Debt
Service*
(Payable from
PTORs)
Payable from
General Fund
Payment
Date
Interest
(A)
Principal
(B)
Total
(C) =
(A) + (B)
Interest
(D)
Principal
(E)
Total
(F) =
(D) + (E)
(G) =
(C) + (F)
(H) = (C) *
Allocable % (I) = (G) - (H)
7/15/23
1/15/24
7/15/24
1/15/25
7/15/25
1/15/26
7/15/26
1/15/27
7/15/27
1/15/28
7/15/28
1/15/29
7/15/29
1/15/30
7/15/30
1/15/31
7/15/31
1/15/32
7/15/32
1/15/33
7/15/33
1/15/34
7/15/34
1/15/35
7/15/35
1/15/36
7/15/36
1/15/37
7/15/37
1/15/38
7/15/38
Total

June 21, 2022

Finance Department

DATE: June 21, 2022
TO: Mayor Butt and Members of the City Council
FROM:

Delmy Cuellar, Director of Finance
Jerry Chak, Accounting Manager

Subject:

City of Richmond Audited Reports for the Fiscal Year
Ended June 30, 2021
FINANCIAL IMPACT: None

PREVIOUS COUNCIL
ACTION:

N/A

STATEMENT OF THE
ISSUE:

The City is required by Charter Section 9d to have an
independent audit of its financial records performed
annually. For Fiscal Year 2020-2021, the City engaged
Badawi & Associates, an independent Certified Public
Accounting firm, to perform the Single Audit, Richmond
Joint Powers Financing Authority Report, and
Independent Accountant’s Report on Agreed-Upon
Procedures Applied to Appropriations Limit Schedule, for the fiscal year ended June 30, 2021.

RECOMMENDED ACTION:

RECEIVE Audited reports for Single Audit, Richmond
Joint Powers Financing Authority Report, and
Independent Accountant’s Report on Agreed-Upon
Procedures Applied to Appropriations Limit Schedule for Fiscal Year 2020-2021 – Finance Department (Delmy
Cuellar 510-620-6740).

AGENDA
REPORT

June 21, 2022
DISCUSSION:

Badawi and Associates, the City of Richmond’s external auditors have provided the reports mentioned below.

Single Audit Report:

The auditors’ responsibilities are to express an opinion on compliance for each of the City’s major federal programs. The auditors conducted an audit of compliance in accordance with financial audits contained in Government Auditing Standards, issued by Comptroller General of the United States and the audit requirements of Tile 2 U.S.

Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). An audit includes examining, on a test basis, evidence about City’s compliance with those requirements and performance such other procedures as auditors consider necessary in the circumstances. The auditors’ opinions on the schedule of expenditures of federal awards are fairly stated in all material respects in relation to the financial statements as a whole.

Richmond Joint Powers Financing Authority Report:

This report comprises the Authority’s basic component unit financial statement and Independent Auditor’s Report. The report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control over financial reporting and compliance.

Independent Accountant’s Report on Agreed-Upon Procedures Applied to Appropriations Limit Schedule:

The auditors performed a procedure in which the City agreed on the Appropriations Limit Worksheet for the year ended June 30, 2021. These procedures are suggested by the League of California Cities and presented in the Article XIII-B Appropriations Limitation Uniform Guidelines, where performed solely to assist in meeting the requirements of Section 1.5 of Article XIII-B of the California constitution.

DOCUMENTS ATTACHED:

Attachment 1 – Single Audit Report for the year ending June 30, 2021 Attachment 2 – Richmond Joint Powers Financing Authority Basic Financial Statements and Independent Auditor’s Report for the year ended June 30, 2021 Attachment 3 – Independent Accountants’ Report on Agreed-Upon Procedures Applied to Appropriations Limit Schedule For the year ending June 30, 2021

Richmond, California
Single Audit Report
For the year ended June 30, 2021

City of Richmond
Single Audit Report
Table of Contents
Page
Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ................................................................ 1 Report on Compliance for Each Major Federal Program and on Internal Control over Compliance in Accordance with the Uniform Guidance And on the Schedule of Expenditures of Federal Awards ............................................................................ 3 Schedule of Expenditures of Federal Awards .......................................................................................................... 7 Notes to Schedule of Expenditures of Federal Awards......................................................................................... 11 Schedule of Findings and Questioned Costs .......................................................................................................... 12

This page intentionally left blank.

REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND

OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN

ACCORDANCE WITH

GOVERNMENT AUDITING STANDARDS
INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and Members of City Council
of the City of Richmond
Richmond, California
We have audited, in accordance with the auditing st andards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of City of Richmond, California (City), as of and for the year ended June 30, 2021, and the related notes to the financial statements. We were engaged to audit the financial statements of the discretely presented component units as of and for the year ended June 30, 2021. These financial statements collectively comprise the City’s basic financial statements, and have issued our report thereon dated December 31, 2021.

Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (internal control) to determ ine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.

Our consideration of internal control over financial reporting was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies an d therefore, material weaknesses or significant deficiencies may exist that have not been identified . However, as described in the accompanying schedule of findings and questioned costs, we did identify certai n deficiencies in internal control that we consider to be material weaknesses and significant deficiencies.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable poss ibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. We consider the deficiencies described in the accompanying schedule of findings and questioned costs as items 2020-001 to be material weaknesses.

2 To the Honorable Mayor and Members of City Council
of the City of Richmond
Richmond, California

A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. We consider the deficiencies described in the accompanying schedule of findings and questioned costs as items 2020-002 to be significant deficiencies.

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City’s financial statements are free from material misstatement, we performed tests of its compli ance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinio n on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

City Response to Findings
The City’s response to the findings identified in our audit is described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on it.

Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integr al part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Badawi & Associates, CPAs
Berkeley, California
May 9, 2022

REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM AND REPORT ON

INTERNAL CONTROL OVER COMPLIANCE IN ACCORDANCE WITH THE UNIFORM

GUIDANCE AND ON THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS INDEPENDENT AUDITOR’S REPORT
To the Honorable Mayor and Members of City Council
of the City of Richmond
Richmond, California
Report on Compliance for Each Major Federal Program
We have audited the City of Richmond, California (City)’s compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have direct and material effect on each of the City’s major federal programs for the ye ar ended June 30, 2021. City’s major federal programs are identified in the summary of auditor’s results se ction of the accompanying sc hedule of findings and questioned costs.

The City’s basic financial statements include the operations of the Richmond Housing Authority, the federal awards expenses of which is not included in the City’s schedule of expenditures of federal awards during the year ended June 30, 2021. Our audit, described below, did not include the operations of Richmond Housing Authority because the federal awards expended by this entity are subject to a separate Single Audit.

Management’s Responsibility
Management is responsible for compliance with federal statutes, regulations, and the terms and conditions of its federal awards applicable to its federal programs.

Auditor’s Responsibility
Our responsibility is to express an opinion on compli ance for each of the City’s major federal programs based on our audit of the types of compliance requirements referred to above. We conducted our audit of compliance in accordance with auditing standards genera lly accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Pr inciples, and Audit Requirements for Federal Awards (Uniform Guidance). Those standards and the Uniform Guidance require that we plan and perform the audit to obtain reasonable assurance about whether noncompliance with the types of compliance requirements referred to above that could have a dire ct and material effect on a major federal program occurred. An audit includes examining, on a test basi s, evidence about the City’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances.

We believe that our audit provides a reasonable basis for our opinion on compliance for each major federal program. However, our audit does not provide a legal determination of the City’s compliance.

To the Honorable Mayor and Members of City Council
of the City of Richmond
Richmond, California

4 Basis for Qualified Opinion on ALN 97.036-Disaster Grants-Public Assistance As described in the accompanying schedule of findings and questioned costs, the City did not comply with requirements regarding ALN 97.036 Disaster Grants-P ublic Assistance as described in finding numbers SA2021-001 for Reporting. Compliance with such requirem ents is necessary, in our opinion, for the City to comply with the requirements applicable to that program.

Qualified Opinion on ALN 97.036-Disaster Grants-Public Assistance In our opinion, except for the noncompliance describe d in the Basis for Qualified Opinion paragraph, the City complied, in all material respects, with the ty pes of compliance requirements referred to above that could have a direct and material effect on ALN 97.036-Disaster Grants-Public Assistance for the year ended June 30, 2021.

Unmodified Opinion on Each of the Other Major Federal Programs In our opinion, the City complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its other major federal programs identified in the summary of auditor’s results section of the accompanying schedule of findings and questioned costs for the year ended June 30, 2021.

Report on Internal Control Over Compliance
Management of the City is responsible for establishing and maintaining effective internal control over compliance with the types of compliance requirements referred to above. In planning and performing our audit of compliance, we considered the City’s in ternal control over compliance with the types of requirements that could have a direct and material e ffect on each major federal program to determine the auditing procedures that are appropriate in the circum stances for the purpose of expressing an opinion on compliance for each major federal program and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control over compliance.

A deficiency in internal control over compliance exis ts when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a time ly basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of de ficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.

To the Honorable Mayor and Members of City Council
of the City of Richmond
Richmond, California

5 Our consideration of internal cont rol over compliance was for the limited purpose described in the first paragraph of this section and was not designed to id entify all deficiencies in internal control over compliance that might be material weaknesses or si gnificant deficiencies and therefore, material weaknesses or significant deficiencies may exist that have not been identified. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses. However, we did identify certain deficiencies in internal control over compliance, described in the accompanying schedule of findings and questioned costs as ite ms SA2021-001, that we consider to be significant deficiencies.

The City’s response to the internal control over complia nce findings identified in our audit is described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response.

Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance We have audited the financial statements of the govern mental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City, as of and for the year ended June 30, 2021, and the related notes to the financial statements. We were engaged to audit the financial statements of the discretely presented component units as of and for the year ended June 30, 2021. These financial statements collectively comprise the City’s basic financial statements. We issued our report thereon dated December 31, 2021, which contained unmodified opinions on the governmental activities, General Fund, Community Development and Loan Programs Special Revenue Fund, Port of Richmond Fund, Municipal Sewer Fund and aggregated remaining funds, and disc laimer opinions on the business-type activities, Richmond Housing Authority Enterprise Fund, and the aggregate discretely presented component units.

Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the basic financial statements. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as re quired by the Uniform Guidance and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying a ccounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting an d other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the schedule of expenditures of federal awards is fairly stated in al l material respects in relation to the basic financial statements as a whole.

To the Honorable Mayor and Members of City Council
of the City of Richmond
Richmond, California

6 The purpose of this report on internal control over co mpliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.

Badawi & Associates, CPAs
Berkeley, California
May 9, 2022, except for the schedule of expenditures
of federal awards on pages 7 to 9, which are as of December 31, 2021

City of Richmond
Schedule of Expenditures of Federal Awards
For the year ended June 30, 2021
Federal State/Other FY 2021
Catalog Pass-through Program
Grantor Agency and Grant Title Number Number Expenditures U.S. Department of Defense
Direct Program:

Community Base Reuse Plans, Project Grant/Cooperative Agreement Naval Fuel Depot Point Molate Pollution Remediation 12.612 211,836$ Total U.S. Department of Defense 211,836
U.S. Department of Housing and Urban Development:

CDBG Entitlement Grants Cluster
Direct Programs:

Community Development Block Grant 14.218 4,412
CDBG Entitlement Grants Cluster Total 4,412
Total U.S. Department of Housing and Urban Development 4,412 U.S. Department of Justice
Pass-through from CA-Office of Emergency Services:

Violence Against Women Formula Grants 16.588 ST20037830 128,323 Pass-through from CA-Department of Justice:

Public Safety Partnership and Community Policing Grants Community Policing Development Program 16.710 2016-CK-WX-K016 40,094 COPS Peer Support Enhancement 16.710 2019MHWXK001 30,000 Program Subtotal 70,094
Direct Program:

Coronavirus Emergency Supplemental Funding 16.034 2020-VD-BX-1694 158,780 Pass-through from Contra Costa County:

Edward Byrne Memorial Justice Assistance Grant 2016 16.738 47,778 Edward Byrne Memorial Justice Assistance Grant 2018 16.738 14,272 Program Subtotal 62,050
Total U.S. Department of Justice 419,247
See accompanying Notes to Schedule of Expenditures of Federal Awards 7Page 795 of 2511
City of Richmond
Schedule of Expenditures of Federal Awards
For the year ended June 30, 2021
Federal State/Other FY 2021
Catalog Pass-through Program
Grantor Agency and Grant Title Number Number Expenditures U.S. Department of Labor
Workforce Innovation and Opportunity Act (WIOA) Cluster Pass-through from California Employment & Training Administration:

WIOA - Adult program
Workforce Accelerator 8.0 17.258 AA011024 79,596
English Language Learners- 1153 17.258 ELL SFP PY 20-21 150,258 English Language Learners-1226 17.258 ELL SFP PY 21-23 3,267 Veterans Hire (VEAP) 17.258 VEAP SFP PY 2018-19 131,711 WIOA - Adult program 17.258 K491036-201/202 308,911
Program Subtotal 673,743
WIOA Youth 17.259 K9111039/ AA011024/
AA111024-301/302 380,824
WIOA Dislocated Worker Formula Grants
COVID-19 Project Hire 17.278 AA011024 493,932
COVID-19 Supportive Service English Language Learners 17.278 AA011024 133,492 WIOA Dislocated Worker 17.278 K491036-501/502 204,179
WIOA Rapid Response 17.278 K491036-540/541 118,027
Rapid Response Layoff Aversion 17.278 K594779-292/293 27,931 WIA/WIOA Dislocated Worker Rapid Reponse 17.278 1233 1,377 Program Subtotal 978,939
Workforce Innovation and Opportunity Act (WIOA) Cluster Total 2,033,506 Pass-through from California Employment & Training Administration COVID-19 Employment Recovery NDWG 17.277 AA011024-1194 168,349 Pass-through from California Employment & Training Administration Youth Build 2020 17.274 YB-34247-19-60-A-6 295,916
Total U.S. Department of Labor 2,497,771
U.S. Department of Transportation
Pass-through from CA-Department of Transportation
Highway Planning & Construction
Yellow Brick Road 20.205 ATPL-5137(049) 2,466
Bridge Preventive Maintenance 20.205 6,132
Castro Ranch Road Rehabilitation 20.205 STPLR-7500(235) 1,249,031 Program Subtotal 1,257,629
Pass-through from CA-Office of Traffic Safety
Selective Traffic Safety Program 608 20.608 PT20115 2,018 Selective Traffic Safety Program 608 20.608 PT21040 97,121 Program Subtotal 99,139See accompanying Notes to Schedule of Expenditures of Federal Awards 8Page 796 of 2511
City of Richmond
Schedule of Expenditures of Federal Awards
For the year ended June 30, 2021
Federal State/Other FY 2021
Catalog Pass-through Program
Grantor Agency and Grant Title Number Number Expenditures U.S. Department of Transportation, continued
Pass-through from CA-Office of Traffic Safety
Traffic Records Improvement 20.616 TR21018 6,534
Pass-through from CA-Office of Traffic Safety
Selective Traffic Enforcement Program 20.600 PT21040 10,357 Total U.S. Department of Transportation 1,373,659
U.S. Institute of Museum and Library Services
Direct Program:

CENIC Broadband 45.310 40-8622 15,463
Family Literacy Program for Families 45.310 5312 27,314 Total US. Institute of Museum and Library Services 42,777 U.S. Environmental Protection Agency
Direct Program
Brownfields Job Training Cooperative Agreements
Environmental Workforce Development and Job Training 66.815 80,068 Brownfield Assessment and Clean-up Cooperation Agreement Brownfield Assessment and Clean-up Cooperation Agreement 66.818 81,955 Brownfield Revolving Loan Fund 66.818 99,698
Program Subtotal 181,653
Total U.S. Environmental Protection Agency 261,721
U.S. Department of Education
Pass-through from California Department of Rehabilitation State Vocational Rehabilitation Services Program 84.126a STEPS 2020 75,024 Total U.S. Department of Education 75,024
U.S. Department of Treasury
Pass-through from State of California
Emergency OP/COVID-19 - CARES ACT 21.019 N/A 1,082,717
Total U.S. Department of Education 1,082,717
U.S. Department of Homeland Security
Pass-through for CA-Office of Emergency Services
Via Verde Emergency Repairs 97.036 FEMA-4308-DR-CA 1,085,871 Total U.S. Department of Education 1,085,871
Total Federal Expenditures 7,055,035$
See accompanying Notes to Schedule of Expenditures of Federal Awards 9Page 797 of 2511
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10Page 798 of 2511
City of Richmond
Single Audit Report
Notes to Schedule of Expenditures of Federal Awards
For the year ended June 30, 2021
11 1. REPORTING ENTITY
The financial reporting entity, as defined by Governmental Accounting Standards Board (GASB), consists of the primary government, which is the City of Rich mond (City), organizations for which the primary government is financially accountable, and other orga nizations for which the nature and significance of their relationship with the primary government are su ch that exclusion would cause the reporting entity’s financial statements to be misleadi ng or incomplete. The Schedule of Expenditure of Federal Awards (the Schedule) includes expenditures of federal awards for the City and its component units as disclosed in the notes to the Basic Financial Statements, except for federal awards of the Richmond Housing Authority.

Federal awards expended by this entity, if any, are excluded from the Schedule and are subject to a separate Single Audit.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
Funds received under the various grant programs have be en recorded within the general, special revenue, capital projects, and enterprise funds of the City. The City utilizes the mo dified accrual basis of accounting for the general, special revenue, and capital project fund s. The accrual basis of accounting is used for the enterprise fund. The accompanying Schedule of Expendit ures of Federal Awards (Schedule) is presented in accordance with the requirements of the U niform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).

Schedule of Expenditures of Federal Awards
The accompanying Schedule presents the activity of a ll Federal financial assistance programs of the City.

Federal financial assistance received directly from Fe deral agencies as well as Federal financial assistance passed through the State of California and other agenci es are included in the Schedule. The Schedule of Expenditures of Federal Awards was prepared from only the accounts of various grant programs and, therefore, does not present the financial position or results of operations of the City.

3. INDIRECT COSTS
The City did not elect to use the 10% de minimis indirect cost rate.

City of Richmond
Single Audit Report
Schedule of Findings and Questioned Costs
For the year ended June 30, 2021
12 Section I – Summary of Auditors’ Results
Financial Statements
Types of auditors’ report issued: Modified
Internal control over financial reporting:
x Material weakness(es) identified? Yes
x Significant deficiency(ies) identified? Yes
Any noncompliance material to the financial statements noted: No Federal Awards
Internal control over major programs:
x Material weakness(es) identified? No
x Significant deficiency(ies) identified? Yes
Types of auditors’ report issued on compliance for major programs: Modified Any audit findings disclosed that are required to be reported in accordance with section 200.516(a): Yes Identification of major programs:

Dollar threshold used to distinguish between type A and type B program: $750,000 Auditee qualified as low-risk auditee under
section 200.520? No

City of Richmond
Single Audit Report
Schedule of Findings and Questioned Costs, Continued
For the year ended June 30, 2021
13 Section II –Current Year Findings
A. Current Year Findings – Financial Statement Audit
2021-001 General Fund Financial Position (Material Weakness) Criteria:

The City’s general fund should maintain adequate fund balance reserve to meet required operating obligations. GFOA recommends that General purpose local governments, regardless of size, at a minimum should maintain unrestricted budgetary fund balance in their general fund of no less than two months of regular general fund operating expenditures.

Condition:

The City’s unrestricted fund balance in the General Fund was $34,714,304, which can only cover less than 3 months expenditures in General Fund that was very close to the recommended minimum level. The ability of the City to meet required operating obligations is dependent on the City’s ability to develop and implement a plan that will successfully increase cash flows.

Cause:

The City has either overspend its budget in the past or the budget was not balanced which depleted available fund balance.

Context and Effect:

Deficiency in fund balances may require significant cost cutting measures to reach a budget that will recoup the fund balance as well as provide the necessary re venues and financing for continued operations of the City.

Recommendation:

We recommend the City continue to analyze all potential cost cutting measures and revenue sources, and review options to establish a budget plan for the Ge neral Fund to recoup the fund balance as well as provide continued financing for City operations.

Management Response:

The City is constantly looking at measures to incr ease revenues. In November 2018, Richmond voters approved Measure H, which increased the real estate transfer tax for properties with a sales price of over $1 million from 0.7 percent to 1.25 percent for sales pr ices below $3 million, 2.5 percent for sales prices between $3 million and $10 million, and 3.0 percent for sales prices over $10 million. This tiered structure has generated for the City of Richmond additional new revenue of more than $20 million since it went into effect on December 28, 2018.

City of Richmond
Single Audit Report
Schedule of Findings and Questioned Costs, Continued
For the year ended June 30, 2021
14 Section II –Current Year Findings, Continued
A. Current Year Findings – Financial Statement Audit, Continued Additionally, Richmond voters approved Measure U, which changed the methodology for calculating business tax from that based on numb er of employees to gross receipts. This is expected to both bring in millions more per year and includes an inflation-linked escalator. As gross receipts are expected to increase with inflation, so are the taxes collected.

The City is making progress in achieving the goal of having the City’s reserve policy of 15% per policy by reducing or even eliminating various negative fund balances. 2021-002 Completeness of Accrued Liabilities (Significant Deficiency) Criteria:

Expenditures/expenses should be recognized in the accounting period in which the liability is incurred.

Condition:

During our review of the unprocessed invoices folder, we found the City had around $3.2M unprocessed invoices that were for goods or services provided during fy2021 and those invoices were not properly accrued back to fy2021.

Cause:

The City doesn’t have a proper process in place to ca pture all the accruals, especially when invoices are received later than the cutoff date. The delay in submission of the invoices from departments also contributes to the failure to capture the accruals timely.

Context and Effect:

Failure to capture all liabilities can lead the financial statements to be materially misstated.

Recommendation:

We recommend the City to implement internal controls to capture material accruals for which the invoices received after cutoff date and recognize the liabilities properly.

Management Response:

The Finance Department is working with all the depa rtments and vendors to ensure that invoices are submitted and processed in a timely manner. One step is reminding the departments that vendors are required to remit all invoices directly to Finance De partment, so the invoices are more easily tracked and processed more efficiently. Additionally, Accounts Payable staff is tracking any receivables received after the accrual cutoff date and analyzing to see if they are material for adjusting journal entry.

City of Richmond
Single Audit Report
Schedule of Findings and Questioned Costs, Continued
For the year ended June 30, 2021
15 B. Current Year Findings and Questioned Costs – Major Federal Award Program Audit SA2021-001: Failure to Maintain Proper Documentation
Assistance Listing Numbers: 97.036
Assistance Listing Title: Disaster Grants – Public Assistance Name of Federal Agency: U.S. Department of Homeland Security Federal Award Identification Number: FEMA-4308-DR-CA
Name of pass-through Entity:C a l i f o r n i a O f f i c e o f E m e r g e n c y S e r v i c e s Criteria:

The grant requires the filing of quarterly progress reports on all open large projects within 30 days after the end of each calendar quarter.

Condition:

The City was unable to show proof of the timely submission of the selected quarterly progress reports.

Cause:

The City doesn’t have internal control in place to en sure the timely submission of the reports. Since the project manager, who was the only person involved in the reporting process, left the City, the City was unable to locate any proof of the timely submission of the reports.

Context and Effect:

We can’t verify if the City is in compliance with the reporting requirements for the grant.

Recommendation:

The City should implement controls to ensure all required reports are submitted timely and maintain documentation of the submission.

Management Response:

All City departments are required to submit grant reim bursements requests to the Grant Helpdesk when it is completed. The Finance Department is in progress to hire an additional employee to support the budget division. This employee will be responsible for monitoring grant submissions, so timely reminders can be sent out and proper escalation steps can be taken if no response or information is submitted by deadlines.

City of Richmond
Single Audit Report
Schedule of Findings and Questioned Costs, Continued
For the year ended June 30, 2021
16 Section III- Prior Year Findings
A. Prior Year Findings – Financial Statement Audit
2020-001 General Fund Financial Position (Material Weakness) Criteria:

The City’s general fund should maintain adequate fund balance reserve to meet required operating obligations. GFOA recommends that General purpose local governments, regardless of size, at a minimum should maintain unrestricted budgetary fund balance in their general fund of no less than two months of regular general fund operating expenditures.

Condition:

The City’s unrestricted fund balance in the General Fund was $21,940,238, which can only cover less than 2 months expenditures in Ge neral Fund. The ability of the City to meet required operating obligations is dependent on the City’s ability to develop and implement a plan that will successfully increase cash flows.

Cause:

The City has either overspend its budget in the past or the budget was not balanced which depleted available fund balance.

Context and Effect:

Deficiency in fund balances may require significant cost cutting measures to reach a budget that will recoup the fund balance as well as provide the necessary re venues and financing for continued operations of the City.

Recommendation:

We recommend the City continue to analyze all potential cost cutting measures and revenue sources, and review options to establish a budget plan for the Ge neral Fund to recoup the fund balance as well as provide continued financing for City operations.

Current Status:

See current year finding.

City of Richmond
Single Audit Report
Schedule of Findings and Questioned Costs, Continued
For the year ended June 30, 2021
17 Section III- Prior Year Findings, Continued
A. Prior Year Findings – Financial Statement Audit, Continued 2020-002 Completeness of Accrued Liabilities (Significant Deficiency) Criteria:

Expenditures/expenses should be recognized in the accounting period in which the liability is incurred.

Condition:

During our expenditures testing for fiscal year 2 020, we noted around $6 million in invoices were for services or goods provided in fiscal year 2019 but were not captured and recognized appropriately in fiscal year 2019. Among the $6 million, $5.3 million were capitalized expenditures/expenses.

Cause:

The City doesn’t have a proper process in place to ca pture all the accruals, especially when invoices are received later than the cutoff date. The delay in submission of the invoices from departments also contributes to the failure to capture the accruals timely.

In addition, the misleading instruction on the AP approval email template, “All invoices received after August 16, 2019 will be paid from FY2019/2020”, might also cause the failure in capturing all accruals.

Context and Effect:

Failure to capture all liabilities can lead the financial statements to be materially misstated.

Recommendation:

We recommend the City to implement internal controls to capture material accruals for which the invoices received after cutoff date and recognize the liabilities properly.

Current Status:

See current year finding.

City of Richmond
Single Audit Report
Schedule of Findings and Questioned Costs, Continued
For the year ended June 30, 2021
18 Section III- Prior Year Findings, Continued
B. Prior Year Findings and Questioned Costs – Major Federal Award Program Audit No findings and questioned costs in the current year.

Richmond Joint
Powers Financing
Authority
Richmond, California
Basic Financial Statements
and Independent Auditor’s Report
For the year ended June 30, 2021

Component Unit Financial Statements
For the year ended June 30, 2021
Table of Contents
i
Independent Auditor’s Report ................................................................................................................................... 1 Basic Financial Statements:

Government-wide Financial Statements:

Statement of Net Position ................................................................................................... .................................... 8 Statement of Activities ..................................................................................................... ....................................... 9 Governmental Funds:

Balance Sheet ............................................................................................................... ........................................... 12 Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position ........................................................................... ......... 13 Statement of Revenues, Expenditures and Changes in Fund Balances ......................................................... 14 Reconciliation of the Statement of Revenues, Expendit ures and Changes in Fund Balances of Governmental Funds to the Government-Wide Statement of Activities .................................................... 15 Fiduciary Funds:

Statement of Fiduciary Net Position ......................................................................................... .......................... 18 Statement of Changes in Fiduciary Net Position .............................................................................................. 19 Notes to the Component Unit Basic Financial Statements ....................................................................... .......... 23 Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ................................................................ 39

ii Page 810 of 2511
INDEPENDENT AUDITOR’S REPORT
To the Board of Directors
of the City of Richmond Joint Powers Financing Authority Richmond, California
Report on the Financial Statements
We have audited the accompanying financial statements of the City of Richmond Joint Powers Financing Authority (Authority), a component unit of the City of Richmond, California, as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the Authority’s basic financial statements as listed in the table of contents.

Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards , issued by the Comptroller General of the United States. Those standa rds require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.

In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expres sing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position of the Authority, June 30, 2021, and the respective changes in financial position, and, where applicable, cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America.

2 Emphasis of a Matter
As discussed in Note 1, the financial statements present only the Authority and do not purport to, and do not, present fairly the financial position of the City of Richmond, California, as of June 30, 2021, and the changes in its financial position, or, where applicable, its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America. Our opinion is not modified with respect to this matter.

Other Matters
Required Supplementary Information
Management has omitted the management’s discussion and analysis that accounting principles generally accepted in the United States of America require to be presented to supple ment the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who co nsiders it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this missing information.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated May 6, 2022 on our consideration of the Authority’s internal contro l over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters.

The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Authority’s internal control over financial reporting and compliance.

Badawi and Associates
Berkeley, California
May 9, 2022

BASIC

FINANCIAL STATEMENTS
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4Page 814 of 2511

GOVERNMENT-WIDE

FINANCIAL STATEMENTS
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GOVERNMENT-WIDE FINANCIAL STATEMENTS
The Statement of Net Position reports the difference between the Authority's total assets and deferred outflows of resources and the Authority's total liabilities and deferred inflows of resources, including all the Authority's capital assets and all its long-term debt. The Statement of Net Position focuses the reader on the composition of the Authority's net position, by subtracting total liabilities and deferred inflows of resources from total assets and deferred outflows of resources. The Statement of Net Position summarizes the financial position of all the Authority's activities in a single column.

The Statement of Activities reports increases and decreases in the Authority's net position. It is prepared on the full accrual basis, which means it includes all the Authority's revenues and all its expenses, regardless of when cash changes hands. This differs from the "modified accrual" basis used in the Fund financial statements, which reflect only current assets and deferred outflows of resources, current liabilities and deferred inflows of resources, available revenues and measurable expenditures.

The Statement of Activities presents the Authority's expenses that are listed by program first. Program revenues that is, revenues which are generated directly by these programs, are then deducted from program expenses to arrive at the net expense of each program. The Authority's general revenues are then listed and the Change in Net Position is computed and reconciled with the Statement of Net Position.

These financial statements along with the fund financial statements and footnotes are called Basic Financial Statements .
7Page 817 of 2511
Richmond Joint Powers Financing Authority
Statement of Net Position
June 30, 2021
Governmental
Activities
ASSETS
Restricted cash and investments 3,882,544 $
Receivables:

Leases 112,572,601
Total assets 116,455,145

LIABILITIES
Interest payable 1,108,836
Long-term debt:

Due within one year 9,088,096
Due in more than one year 123,219,918
Total liabilities 133,416,850

NET POSITION
Unrestricted (16,961,705)
(16,961,705)$ Total net position
See accompanying Notes to Basic Financial Statements
8Page 818 of 2511
Richmond Joint Powers Financing Authority
Statement of Activities
For the year ended June 30, 2021
Governmental
Activities
Program expense:

Interest on long-term debt 4,800,066 $
Total program expense 4,800,066
Program revenue:

Lease revenue 6,114,849
Investment earnings 32,474
Total program revenue 6,147,323
Net program revenue (expense) 1,347,257
Changes in Net Position 1,347,257
(18,308,962)
(16,961,705)$ Net Position - Ending
Net Position - Beginning, as restated
See accompanying Notes to Basic Financial Statements
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10Page 820 of 2511

FUND FINANCIAL STATEMENTS
Major funds are defined as having significant activities or balances in the current year. All of the Authority's funds are major funds.
11Page 821 of 2511
Richmond Joint Powers Financing Authority
Balance Sheet
Governmental Funds
June 30, 2021
Redevelopment
Agency Total
Port (Successor Agency) City Governmental
Related Debt Related Debt Related Debt Funds
ASSETS
Restricted cash and investments 214$ 3,882,321$ 9$ 3,882,544$ Total assets 214 3,882,321 9 3,882,544

FUND BALANCES
Restricted 214 3,882,321 9 3,882,544 Total fund balances 214 3,882,321 9 3,882,544 Total deferred inflows of resources
and fund balances 214$ 3,882,321$ 9$ 3,882,544$ See accompanying Notes to Basic Financial Statements
12Page 822 of 2511
Total Fund Balances - Total Governmental Funds 3,882,544$ The assets and liabilities below are not due and payable in the current year period and therefore are not reported in the Funds:

Lease receivables 112,572,601
Long-term debt (132,308,014)
Interest payable (1,108,836)
Net Position of Governmental Activities (16,961,705)$
Richmond Joint Powers Financing Authority
Reconciliation of the Governmental Funds Balance Sheet
to the Government-Wide Statement of Net Position
June 30, 2021
See accompanying Notes to Basic Financial Statements
13Page 823 of 2511
Richmond Joint Powers Financing Authority
Statement of Revenues, Expenditures and Changes in Fund Balances Governmental Funds
For the year ended June 30, 2021
Redevelopment
Agency Total
Port (Successor Agency) City Governmental
Related Debt Related Debt Related Debt Funds
REVENUES:

Use of money and property -$ 32,409$ 65 $ 32,474$ Total revenues - 32,409 65 32,474
EXPENDITURES:

Debt service:

Principal 3,945,000 2,185,000 3,354,681 9,484,681 Interest and fiscal charges 742,106 935,227 4,470,757 6,148,090 Total expenditures 4,687,106 3,120,227 7,825,438 15,632,771

REVENUES OVER (UNDER)
EXPENDITURES (4,687,106) (3,087,818) (7,825,373) (15,600,297) OTHER FINANCING SOURCES (USES):

Transfer from the City 4,687,204 2,749,190 7,824,731 15,261,125 Total other financing sources (uses) 4,687,204 2,749,190 7,824,731 15,261,125 Net change in fund balances 98 (338,628) (642) (339,172) FUND BALANCES:

Beginning of year 116 4,220,949 651 4,221,716 End of year 214$ 3,882,32 1$ 9$ 3,882,544$ See accompanying Notes to Basic Financial Statements
14Page 824 of 2511
Richmond Joint Powers Financing Authority
Reconciliation of the Statement of Revenues, Expenditures, and Changes in Fund Balances of Governmental Funds to the Government-Wide Statement of Activities For the year ended June 30, 2021
Net Change in Fund Balances - Total Governmental Funds (339,172)$ Debt proceeds provide current financial resource s to governmental funds , but issuing debt increased long- term liabilities in the Government-Wide Statement of Net Position. Repayment of debt was an expenditure in governmental funds, but the repayment reduced long-term liabilities in the Government-Wide Statement of Net Position.

Long-term debt repayment
s 9,484,681
Amortization of bonds premium 1,254,911
Repayment of the lease receivable was recognized as transfers in governmental funds, but it reduced the lease receivable in the Government-Wide Statement of Net Position (9,146,276) Th
e amounts below included in th e Statement of Activitie s do not provid e (or require) the use of current financial resources and therefore are not reported as revenue or expenditures in the governmental funds (net change):

Bond interest payabl
e 93,113
Change in Net Position of Governmental Activities 1,347,257$ Amounts reported for governmental activities in the Government-Wide Statement of Activities were different because:

See accompanying Notes to Basic Financial Statements
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FIDUCIARY FUND FINANCIAL STATEMENTS
Fiduciary funds are presented separately from the Government-Wide and Fund financial statements.

Custodial funds are used to account for assets held by the Authority as an agent for individuals, private organizations, and other governments. The financial activities of these funds are excluded from the Authority-wide financial statements, but are presented in separate Fiduciary Fund financial statements. 17Page 827 of 2511
Richmond Joint Powers Financing Authority
Statement of Fiduciary Net Position
Custodial Funds
For the year ended June 30, 2021
2016 Reassessment
District
ASSETS
Cash and investments 1,845,567$
Interest receivable 576
Total assets 1,846,143

NET POSITION
Restricted for:

Individuals, organizations, and
other governments 1,846,143
Total net position 1,846,143$
See accompanying Notes to Basic Financial Statements
18Page 828 of 2511
Richmond Joint Powers Financing Authority
Statement of Changes in Fiduciary Net Position
Custodial Funds
For the year ended June 30, 2021
2016 Reassessment
District
ADDITIONS:

Interest income 7,912$
Total additions 7,912
Change in net position 7,912
NET POSITION:

Beginning of year -
Restatements 1,838,231
Beginning of year, as restated 1,838,231
End of year 1,846,143$
See accompanying Notes to Basic Financial Statements
19Page 829 of 2511
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NOTES TO BASIC

FINANCIAL STATEMENTS
21Page 831 of 2511
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Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
23 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The basic financial statements of the Richmond Joint Powers Financing Authority (Authority) have been prepared in conformity with generally accepted accoun ting principles (GAAP) as applied to governmental agencies. The Governmental Accounting Standards Boards (GASB) is the accepted standard setting body for establishing governmental accounting and financial reporting principles.

The more significant of the Authority policies are described below.

A. Financial Reporting Entity
The Authority is a joint exercise of powers authorit y formed on December 1, 1989, by and between the City of Richmond and the former Richmond Community Redevelopment Agency to assist the City, the Community Redevelopment Agency, and other local public agencies in financing and refinancing capital improvements and working capital pursuant to the Marks-Roos Local Bond Pooling Act of 1985.

The Authority is authorized to purchase obligatio ns of the City, Community Redevelopment Agency, and other local public agencies. The former Richmond Community Redevelopment Agency was dissolved and its assets turned over to and liabilit ies assumed by Successor Agencies effective January 31, 2012, including the liabilities payable to the Authority.

Although the Authority is a separate legal entity, it is an integral part of th e City. The City exercises significant financial and management control ov er the Authority and members of the Board of Directors are appointed by City Council. The operations of the Authority are included in the City’s basic financial statements as a debt service fund.

B. Basis of Accounting and Measurement Focus
The accounts of the Authority are organized on the basis of funds, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self- balancing accounts which comprise its assets, deferred outflows/inflows of resources, liabilities, fund equity, revenues and expenditures. Authority re sources are allocated to and accounted for in individual funds based upon the purpose for whic h they are to be spent and the means by which spending activities are controlled.

Authority-Wide Financial Statements – Authority-Wide Financial Statements include a Statement of Net Position and a Statement of Activities. These statem ents present summaries of Governmental Activities for the Authority. The Authority has no Business-Type Activities.

The Authority-wide financial statements are presented on an “economic resources” measurement focus and the accrual basis of accounting. Accordin gly, all of the Authority’s assets, deferred outflows/inflows of resources, and liabilities, includin g capital assets as well as infrastructure assets and long-term liabilities, are included in the Statem ent of Net Position. The Statement of Activities presents all the Authority’s revenues, expenses and other changes in Net Position. Under the accrual basis of accounting, revenues are recognized in the period in which they are earned while expenses are recognized in the period in which the liability is incurred.

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
24 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued B. Basis of Accounting and Measurement Focus, Continued Governmental Fund Financial Statements – Governmental Fund Financial Statements include a Balance Sheet and a Statement of Revenues, Expenditures and Changes in Fund Balances for all major governmental funds. An accompanying schedule is presented to reconcile and explain the differences in fund balances as presented in these statements to the net position presented in the Authority-Wide financial statements.

All governmental funds are accounted for on the “current financial resources” measurement focus and the modified accrual basis of accounting. Accordin gly, only current assets, deferred outflows of resources and current liabilities and deferred inflows of resources are included on the Balance Sheets.

The Statement of Revenues, Expenditures and Changes in Fund Balances presents increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets.

Under the modified accrual basis of accounting, reve nues are recognized in the accounting period in which they become both measurable and available to finance expenditures of the current period.

Accordingly, revenues are recorded when received in cash, except that revenues subject to accrual (generally ninety days after the fiscal year-end) are recognized when due. The primary revenue sources which have been treated as susceptible to accrual by the Authority are leases and earnings on investments. Expenditures are recorded in the accoun ting period in which the related fund liability is incurred also generally ninety days after the fiscal year end.

Reconciliations of the Fund Financial Statements to the Authority-Wide Financial Statements are provided to explain the differences between the two approaches.

Fiduciary Fund Financial Statements – The Authority’s Fiduciary Funds represent Custodial Funds.

Custodial Funds are custodial in nature (assets equal liabilities) and do not involve measurement of results of operations.

C. Cash and Investments
All investments are stated at fair value. Market value is used as fair value for all securities. Investments are carried at market value and investment income is generally allocated among funds on the basis of average cash and investment balances in these funds. Interest income on certain investments is allocated based on the source of the investment and legal requirements which apply.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market partic ipants at the measurement date. The Authority categorizes its fair value measurements within th e fair value hierarchy established by generally accepted accounting principles. The fair value hierarchy categorizes the inputs to valuation techniques used to measure fair value into three levels based on the extent to which inputs used in measuring fair value are observable in the market.

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
25 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued C. Cash and Investments, Continued
Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 inputs are inputs – other than quoted prices included within level 1 – that are observable for an asset or liability, either directly or indirectly.

Level 3 inputs are unobservable inputs for an asset or liability.

If the fair value of an asset or liability is measured using inputs from more than one level of the fair value hierarchy, the measurement is considered to be based on the lowest priority level input that is significant to the entire measurement.

D. Deferred Outflows/Inflows of Resources
In addition to assets, the statement of net position or balance sheet will sometimes report a separate section for deferred outflows of resources. This separate financial statement element, deferred outflows of resources, represents a consumption of net position that applies to a future period(s) and so will not be recognized as an outflow of resources (expense/expenditure) until then.

In addition to liabilities, the statement of net position or balance sheet report a separate section for deferred inflows of resources. This separate financia l statement element, deferred inflows of resources, represents an acquisition of net position or fund ba lance that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time.

E. Net Position and Fund Balance
In the Authority-Wide Financial Statements, net position is the excess of all the Authority’s assets and deferred outflows of resources, over all its liabilit ies and deferred inflows of resources, regardless of fund.

When an expense is incurred for purposes for which both restricted and unrestricted net position is available, the Authority’s policy is to apply restricted net position first.

In the Fund-Level Financial Statements, fund balance represents the net current assets of each fund.

Net current assets generally represent a fund’s cash and receivables, less its liabilities. The Authority’s fund balances are classified based on spending constraints imposed on the use of resources. For programs with multiple fu nding sources, the Authority prioritizes and expends funds in the following order: Restricted, Committed, Assigned, and Unassi gned. Each category is ranked according to the degree of spending constraint.

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
26 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, Continued E. Net Position and Fund Balance, Continued
Restricted fund balances have external restrictions impo sed by creditors, grantors, contributors, laws, regulations, or enabling legislation which requires th e resources to be used only for a specific purpose.

Encumbrances and nonspendable amounts subject to restrictions are included along with spendable resources. All of the Authority’s fund balance is rest ricted for debt service and is legally restricted for the payment of principal and interest on long-term liabilities.

F. Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

2. CASH AND INVESTMENTS
Cash and investments are classified in the financial statements as shown below, based on whether or not their use is restricted under the terms of debt instruments or Authority agreements:

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
27 2. CASH AND INVESTMENTS, Continued
A. Investments
Under the terms of the Authority’s debt issues and lease agreements, it is subject to various restrictions in the type, maturity and credit ratings of investments of the unspent proceeds of these issues. Under the provisions of the Authority’s bond indentures, and in accordance with California Government Code, the following investments are authorized:

B. Interest Rate Risk
Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. Normally, the longer the maturity of an investment, the greater the sensitivity of its fair value to changes in market interest rates. One of the ways the Authority manages its exposure to interest rate risk is by purchasing a combination of shorter term and longer term investments and by timing cash flows from maturities so that a portio n of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the cash flow and liquidity needed for operations.

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
28 2. CASH AND INVESTMENTS, Continued
B. Interest Rate Risk, Continued
Information about the sensitivity of the fair values of the Authority’s investments to market interest rate fluctuations is provided by the following table that shows the distribution of the Authority’s investments by maturity or earliest call date:

Money market mutual funds are available for withdrawal on demand and at June 30, 2021, matured in an average of 40 to 49 days.

C. Fair Value Hierarchy
The Authority categorizes its fair value measurements within the fair value hierarchy established by generally accepted accounting prin ciples. The hierarchy is based on the valuation inputs used to measure fair value of the assets. Level 1 inputs are quoted prices in an active market for identical assets; Level 2 inputs are significant other observable inpu ts; and Level 3 inputs are significant unobservable inputs.

Fair value is defined as the quoted market value on the last trading day of the period. These prices are obtained from various pricing sources by our cust odian bank. The Authority’s investments including money market mutual funds, guaranteed investment contracts and reassessment bonds are measured at amortized cost.

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
29 2. CASH AND INVESTMENTS, Continued
D. Credit Risk
Credit risk is the risk that an issuer of an investme nt will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. Presented below is the actual rating as of June 30, 2021 for each investment type:

E. Concentration of Credit Risk
Investments in the securities of any individual issuer, other than U.S. Treasury securities, mutual funds, and external investment pools that represent more than 5% or more of total Redevelopment Agency Related Fund investments were as follows at June 30, 2021:

3. NON-CANCELABLE LEASES RECEIVABLE
The Authority has entered into several non-cancelable lease agreements with the City and former Community Redevelopment Agency as part of its issuan ces of debt on their behalf. These Agreements call for the Authority to receive lease amounts that are struct ured to be sufficient in timing and amount to meet the Authority’s related debt service payments. Pursuant to ABx1 26 adopted by the State of California which was validated by the California Supreme Court on December 28, 2011, the Richmond Community Redevelopment Agency was dissolved and its assets tu rned over to and liabilities assumed by Successor Agencies effective January 31, 2012, including the leases payable to the Authority.

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
30 3. NON-CANCELABLE LEASES RECEIVABLE, Continued
At June 30, 2021, the balances of these receivables, less an adjustment factor for debt service reserve accounts held by the Authority, were as follows:

4. LONG-TERM DEBT
Authority-Wide Financial Statements - Long-term debt is reported as liabilities of the appropriate governmental activity.

Fund Financial Statements – Governmental fund financial statem ents do not present long-term debt.

Governmental funds report bond premiums, discounts and issuance costs in the ye ar the debt is issued.

Bond proceeds are reported as other financing sources, net of premium or discount. Issuance costs are reported as debt service expenditures.

Custodial Fund Financial Statements – These funds are used to account for assets held by the Authority as an agent for special assessment districts within the City. The financial activities of these funds are excluded from the Authority-Wide Financial Statements, but ar e presented in separate Fiduciary Fund Financial Statements.

The following is a summary of long-term debt transactions and balances during the fiscal year ended June 30, 2021:

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
31 4. LONG-TERM DEBT, Continued
2003 Tax Allocation Revenue Bonds Series A and Series B – Original Issue Series A $16,080,000, Series B $12,500,000
The Bonds were issued on August 27, 2003 by the Authority. The proceeds of the Series A Bonds were used to finance certain capital improvements for the Richmond Redevelopment Agency and pay $13,000,000 to the City in partial payment of Prior Obligations. The proceeds of the Series B Bonds were used to finance certain capital improvements for the Agency and pay $5 ,000,000 to the City in partial payment of Prior Obligations. Interest rates range from 3.00% to 6.30% and are payable semiannually on March 1 and September 1. The bonds are secured by a pledge of certain tax increment revenues derived from taxable property within certain Redevelopment Agency project areas.

On March 27, 2014, the Successor Agency issued the Successor Agency to the Richmond Community Redevelopment Agency Refunding Bonds 2014 Seri es A & B which resulted in the refunding and defeasance of the outstanding balance of the 2003 Series A Bonds in the amount of $13,290,000.

At issuance, the Bonds were insured by MBIA Insurance Corporation (which was reinsured by National Public Finance Guarantee Corporation (“NPFGC”)). On December 5, 2017, Kro ll Bond Rating Agency downgraded its insurance financial strength rating for NPFGC from ‘AA+’ to ‘AA’ and subsequently withdrew the rating citing business reasons. On Ja nuary 17, 2018, Moody’s Inve stors Service (“Moody’s”) downgraded its insurance financial strength rating on NPFGC from ‘A3’ to ‘Baa2’. As a result of the foregoing, Moody’s downgraded its Insured Rating on the Bonds from ‘A3’ to ‘Baa2’. On February 13, 2019, S&P Global Ratings (formerly Standard and Poor’s Ratings Services) upgraded its Local Currency Long- Term and Underlying Ratings on the Bonds from ‘A+’ to ‘AA-’.

The annual debt service requirements on the 2003 Series B Bonds are as follows:

For the Years
Ending June 30, Principal Interest Total
2022 835,000 349,493 1,184,493
2023 885,000 295,313 1,180,313
2024 940,000 237,825 1,177,825
2025 1,600,000 157,815 1,757,815
2026 1,705,000 53,708 1,758,708
Total 5,965,000$ 1,094,154 $ 7,059,154 $

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
32 4. LONG-TERM DEBT, Continued
2004 Tax Allocation Revenue Bonds Series A and Series B – Original Issue Series A $15,000,000, Series B $2,000,000
The Bonds were issued on October 28, 2004 by the Authority. The proceeds from the Series A Bonds were used to repay advances from the City and finance certain working capital requirements and low and moderate income housing activities of the Redevelopment Agency. The proceeds of the Series B Bonds were used to finance certain low and moderate income housing activities of the Redevelopment Agency. Interest rates range from 2.00% to 5.44% and payments are due semiannually on March 1 and September 1. The Bonds are secured by certain amounts payable by the Redevelopment Agency to the Authority and certain tax increment revenues derived from the taxable property within the Merged Project Area.

The annual debt service requirements on the bonds are as follows:

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
33 4. LONG-TERM DEBT, Continued
Lease Revenue Refunding Bonds, Series 2016 – Original Issue - $28,390,000 On February 1, 2016, the Authority issued Series 2016 Lease Revenue Refunding Bonds in the amount of $28,390,000. The proceeds from the Bonds were used to pay the obligations for the termination of the interest swap agreement and the option on swaption agreement (swaption) related to the Authority’s Series 2009 Lease Revenue Refunding Bonds and to pay the costs associated with the issuance of the Series 2016 Bonds. On February 3, 2016 the interest rate swap agreement and the swaption related to the Series 2009 Bonds were terminated with a swap termination payment of $28,554,000.

The Bonds bear interest rates of 4.00% to 5.50%. Principal payments are due annually on November 1 through 2037 and semi-annual interest payments are due May 1 and November 1 commencing on May 1, 2016.

At June 30, 2021 the 2016 Bonds consisted of the following:

The annual debt service requirements are as follows:

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
34 4. LONG-TERM DEBT, Continued
Richmond Joint Powers Financing Authority Lease Revenue Bonds, Series 2019A – Original Issue - $63,970,000
The Series 2019A Bonds are being issued to: redeem $77,315,000 outstanding principal amount of the Authority’s Lease Revenue Refunding Bonds (Civic Center Project) Series 2009, purchase a reserve facility for deposit into the reserve account established for the Series 2019A Bonds, fund a deposit into the Interest Account within the Revenue Fund to capitalize a portion of the interest due on May 1, 2020, and pay costs associated with the issuance of the Series 2019A Bo nds. The Bonds are payable solely from, and secured solely by, Revenues of the Authority, consisting primar ily of Base Rental Payments to be received by the Authority from the City of Richmond under a Facility Lease, dated as of August 1, 2019, by and between the City and the Authority, for the right to use and the occupancy of certain real property and facilities. The Series 2019A Bonds will mature on November 1 annually commencing November 1, 2020. Interest on the Series 2019A Bonds is payable at the rate of 5% on November 1 and May 1 of each year, commencing May 1, 2020. The refunding resulted in an overall debt service savings of $29,893,316. The net present value of the debt service savings is called an economic gain and amounted to $25,000,596.

At June 30, 2021 the 2019A Bonds consisted of the following:

The annual debt service requirements are as follows:

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
35 4. LONG-TERM DEBT, Continued
Richmond Joint Powers Financing Authority Point Potrero Lease Revenue Bonds, Series 2019B – Original Issue ($20,580,000)
The Series 2019B Bonds are being issued to: (i) defease and redeem on a current basis all of the Authority’s $26,830,000 outstanding Point Potrero Lease Revenue Bonds, Series 2009A and (ii) pay certain costs associated with the issuance of the Series 2019B Bonds. The Series 2019B Bonds are payable solely from, a n d s e c u r e d s o l e l y b y , R e v e n u e s o f t h e A u t h o r i t y , c o n s i s t i n g p r i m a r i l y o f B a s e R e n t a l P a y m e n t s t o b e received by the Authority from the City under a Facility Lease, dated as of August 1, 2019, by and between the City of Richmond and the Authority, for the right to use and the possession of certain real property and facilities, consisting of Wharves No. 7 and 8 at the Point Potrero Marine Terminal of the Port of Richmond.

The amount of the Base Rental Payments is calculated to be sufficient to pay principal of and interest on the Series 2019B Bonds when due. Interest on the Series 2019B Bonds is payable on May 1 and November 1 of each year, commencing November 1, 2019. The refundin g resulted in an overall debt service savings of $4,351,195. The net present value of the debt service savings is called an economic gain and amounted to $4,177,680.

At June 30, 2021 the 2019B Bonds consisted of the following:

The annual debt service requirements on the 2019B Bonds are as follows:

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
36 4. LONG-TERM DEBT, Continued
Recovery Zone Economic Development Lease – Original Amount $1,316,000 On December 1, 2010 the Authority entered into a capi tal lease with Bank of America in the amount of $1,316,000 to finance the improvements to three of the City’s fire stations and a senior center. The City agreed to lease the three fire stations to the Authority in exchange for lease payments in the amount of the debt. The Authority received the lease proceeds under an allocation of the National Recovery Zone Economic Development Bonds under the American Recovery and Reinvestment Act of 2009 which includes a direct subsidy from the United States Treasury for the interest payable on the bonds. The lease subsidy will be payable on or about the date that the Authority makes its debt service payments and is equal to 45% of the interest payable on the lease upon filing of a request by the Authority. The total subsidy received in fiscal year 2021 was $14,932. The lease bears interest at a rate of 6.50% and principal and interest payments on the lease are due semi-annually on June 15 and December 15 commencing on June 15, 2011 through 2026.

The annual debt service requirements on the capital lease are as follows:

For the Years
Ending June 30, Principal Interest Total
2022 98,096 28,979 127,075
2023 101,634 22,546 124,180
2024 105,300 15,881 121,181
2025 109,098 8,975 118,073
2026 56,017 1,821 57,838
Total 470,145 $ 78,202 $ 548,347 $

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
37 4. LONG-TERM DEBT, Continued
Events of Default, Termination Events and Subjective Acceleration Clauses Below is a summary of certain events of default and termination events with finance related consequences, along with the subjective acceleration clauses, as applicable, for all of the City’s outstanding long-term debt obligations. Each agreement may contain additional events of default, termination events or other subjective acceleration clauses.

A. If the Successor Agency fails to pay rental payable when due or the Authority fails to pay debt service when due, the delinquent principal and in terest is due and payable immediately. If the Successor Agency files for reorganization unde r bankruptcy laws, any court of competent jurisdiction shall assume custody or control of the Authority or of the whole or any substantial part of its property.

B. If the City fails to pay rental payable when due or the Authority fails to pay debt service when due, the delinquent principal and interest is due and pa yable immediately. In the event of default, the Authority has the option to exercise the right of entry and re-entry upon the leased property, including the right to re-lease the property if the City does not pay the delinquent rent.

C. If the City fails to pay lease payments when due or observe other covenants in the lease agreement within thirty days of the written notice of the failure, the outstanding balances are due and payable immediately. If the City files for reorganization under bankruptcy laws, the aggregate outstanding principal balance and accrued interest are immediately due and payable. In the event of default, the Authority has the option to exercise the right of entry and re-entry upon the leased property, including the right to re-lease the property if the City does not pay the delinquent lease payments.

Richmond Joint Powers Financing Authority
Notes to the Component Unit Basic Financial Statements
For the year ended June 30, 2021
38 4. LONG-TERM DEBT, Continued
Debt Without City or Authority Commitment
Special assessment districts have been established in various parts of the City to provide improvements to properties located in those districts. Properties in these districts are assessed for the cost of improvements; these assessments are payable solely by property owners over the term of the debt issued to finance these improvements. The City or Authority are not legally or morally obligated to pay these debts or be the purchaser of last resort of any foreclosed properties in these special assessment districts, nor are they obligated to advance City or Authority funds to repay these debts in the event of default by any of these districts. At June 30, 2021, the balances of these Districts’ outstanding debt were as follows:
2016 Reassessment Revenue Refunding Bonds
On August 8, 2016 the Authority issued $7,895,000 in Reassessment Revenue Refunding Bonds. The proceeds were used to refund the outstanding 2006 Reassessment Revenue Bonds Series A and B and pay c e r t a i n c o s t s o f i s s u a n c e o f t h e B o n d s . T h e b o n d s b e a r a n i n t e r e s t r a t e o f 2 . 5 6 % w h i c h i s p a y a b l e semiannually on March 2 and September 2. The interest on and principal of the Reassessment Bonds are payable from the annual Reassessment installments co llected on the regular property tax bills sent to owners of property within the District having unpaid special Reassessments levies against them.

5. PRIOR PERIOD ADJUSTMENT
During 2021, prior period adjustments were made to correct the premium amount of 2016 Lease Revenue Refunding Bonds:

REPORT ON INTERNAL CONTROL OVER FINANCIAL

REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF

FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT

AUDITING STANDARDS
Independent Auditor’s Report
To the Board of Directors
of the City of Richmond Joint Powers Financing Authority Richmond, California
We have audited, in accordance with the auditing st andards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the City of Richmond Joint Powers Financing Authority (Authority), a component unit of the City of Richmond, as of and for the year ended June 30, 2021, and the related notes to the financial statements, which collectively comprise the Authority’s basic financial statements, and have issued our report thereon dated May 9, 2022.

Internal Control Over Financial Reporting
In planning and performing our audit of the financia l statements, we considered the Authority’s internal control over financial reporting (internal control) to determine the audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Authority’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Authority’s internal control.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limi ted purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies. Given thes e limitations, during our audit we di d not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified.

40 To the Board of Directors
of the City of Richmond Joint Powers Financing Authority Richmond, California

Compliance and Other Matters
As part of obtaining reasonable assurance about whether the Authority’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statem ent amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards.

Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Badawi and Associates
Berkeley, California
May 9, 2022

Richmond, California
Independent Accountants’ Report on
Agreed-Upon Procedures Applied to
Appropriations Limit Schedule
For the fiscal year ending June 30, 2021

City of Richmond
Appropriations Limit Schedule
For the fiscal year ending June 30, 2021
Table of Contents
Page
Independent Accountant’s Report on Limited Procedures Review of Appropriations Limit under Article XIIIB of the California Constitution ................................................. 1 Appropriations Limit Schedule .............................................................................................................................. 3 Notes to Appropriations Limit Schedule .............................................................................................................. 4

INDEPENDENT ACCOUNTANTS’ REPORT ON LIMITED PROCEDURES

REVIEW OF APPROPRIATIONS LIMIT UNDER ARTICLE XIIIB

OF THE CALIFORNIA CONSTITUTION
To the Honorable Mayor and City Council
of the City of Richmond
Richmond, California
We have performed the procedures enumerated below to the accompanying Appropriations Limit Schedule of the City of Richmond (City) for the fiscal year ending June 30, 2021. These procedures, which were agreed to by the City and the League of California Cities (as presented in the publication entitled Agreed- upon Procedures Applied to the Appropriations Limita tion Prescribed by Article XIII-B of the California Constitution), were performed solely to assist you in meetin g the requirements of Section 1.5 of Article XIII- B of the California Constitution. The City management is responsible for the Appropriations Limit Schedule. The sufficiency of these procedures is solely the responsibility of those parties specified in this report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or any other purpose.

The procedures performed and our findings are described below:

1. We obtained the completed worksheets used by the City to calculate its appropriations limit for the fiscal year ending June 30, 2021, and determined that the limit and annual calculation factors were adopted by resolution of City Council. We al so determined that the population and inflation options were selected by a recorded vote of City Council.

Findings: No exceptions were noted as a result of our procedures.

2. For the accompanying Appropriations Limit Schedu le, we added the prior year’s limit to the total adjustments, and agreed the resulting amount to the current year’s limit.

Findings: No exceptions were noted as a result of our procedures.

3. We agreed the current year information presen ted in the accompanying Appropriations Limit Schedule to corresponding information in worksheets used by the City.

Findings: No exceptions were noted as a result of our procedures.

4. We agreed the prior year appropriations limit presented in the accompanying Appropriations Limit Schedule to the prior year appropriations limit adopted by the City Council during the prior year.

Findings: No exceptions were noted as a result of our procedures.

2 To the Honorable Mayor and Members of City Council
of the City of Richmond
Richmond, California

This agreed-upon procedures engagement was cond ucted in accordance with attestation standards established by the American Institute of Certified Public Accountants. We were not engaged to and did not conduct an examination or review, the objective of which would be the expression of an opinion on the accompanying Appropriation Limit Schedule. Accordingl y, we do not express such an opinion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. No procedures have been pe rformed with respect to the determination of the appropriation limit for the base year, as defined by Article XIII-B of the California Constitution.

This report is intended solely for the information and use of the City Council and management of the City and is not intended to be and should not be used by anyone other than these specified parties.

Badawi and Associates
Certified Public Accountants
Berkeley, California
April 23, 2021

City of Richmond
Appropriations Limit Schedule
Amount Source
A. Appropriations limit for the year ended June 30, 2020 408,345,523$ Prior Year Schedule B. Calculation Factors:

1. Population increase % 1.0026 State Department of Finance

2. Inflation increase % 1.0373 State Department of Finance

3. Total adjustment factor % 1.0400 B1*B2 C. Annual Adjustment Increase 16,332,588 [(B3-1)A)] D. Other Adjustments -
E. Total Adjustments 16,332,588 (C+D)
F. Appropriations limit for the year ending June 30, 2021 424,678,111$ (A+E) For the fiscal year ending June 30, 2021
3Page 855 of 2511
City of Richmond
Notes to Appropriations Limit Schedule
For the fiscal year ending June 30, 2021
4 1. PURPOSE OF LIMITED PROCEDURES REVIEW
Under Article XIIIB of the California Constitution (t he Gann Spending Limitation Initiative), California governmental agencies are restricted as to the amount o f a n n u a l a p p r o p r i a t i o n s f r o m p r o c e e d s o f t a x e s .

Effective for years beginning on or after July 1, 1990, under Section 1.5 of Article XIIIB, the annual calculation of the appropriations limit is subject to a limited procedures review in connection with the annual audit.

2. METHOD OF CALCULATION
Under Section 10.5 of Article XIIIB, for fiscal years be ginning on or after July 1990, the appropriations limit is required to be calculated based on the limit for th e fiscal year 1986-1987, adjusted for the inflation and population factors discussed in Notes 3 and 4 below.

3. INFLATION FACTORS
A California governmental agency may use as its inflation factor either the annual percentage change in the 4th quarter per capita personal income (which percenta ge is supplied by the State Department of Finance) or the percentage change in the local assessment roll from the preceding year due to the change of local nonresidential construction. The factor adopted by the City for the fiscal year 2021 represents the percentage change in the 4th quarter per capita personal income.

4. POPULATION FACTORS
A California governmental agency may adjust its appropriations limit by either the annual percentage change of the jurisdiction’s own population, or the an nual percentage change in population in the County where the jurisdiction is located. The factor adopted by the City of Richmond for fiscal year 2020-2021 represents the annual percentage change in population for the County.

5. OTHER ADJUSTMENTS
A California government agency may be required to adjust its appropriations limit when certain events occur, such as the transfer of responsibility for municipal services, to, or from, another government agency or private entity. There were no adjustments made for fiscal year ending June 30, 2021.

June 21, 2022

Human Resources

DATE: June 21, 2022
TO: Mayor Butt and Members of the City Council
FROM:

Laura Marquez, Risk Manager

Subject:

Approve a Two-Year Extension to Contract with Du-All
Safety, LLC to Continue to Provide Safety Program
Compliance Services
FINANCIAL IMPACT: The proposed expenditure is included within the approved fiscal year 2022/2023 budget, Human Resources
Department, Risk Management Division (50182316-
400201), and will be budgeted in future years at the
appropriate amount.

PREVIOUS COUNCIL
ACTION:

July 2, 2019, approved standard contract with an option for two-year extension.

STATEMENT OF THE
ISSUE:

The current contract between the City of Richmond and
Du-All Safety, LLC for safety compliance and loss
prevention services will expire on June 30, 2022. A
Request for Proposals was issued in April of 2019. Du-
All Safety, LLC was retained for three-years with an
option for two-year extension.

RECOMMENDED ACTION:

APPROVE a two-year contract amendment with Du-All
Safety LLC, increasing the amount of the contract by
$317,531, for a total amount not to exceed $760,206, to continue providing safety program compliance services,
with a term ending June 30, 2024 - Human Resources,
Risk Management (Laura Marquez 620-6974).

AGENDA
REPORT

June 21, 2022
DISCUSSION:

The City revitalized its safety program in 2005 in response to the City Manager’s assessment report identifying a need to establish a workplace safety program to reduce work-related injuries and avoid citations from CalOSHA. In 2007, Du-All Safety, LLC was selected to perform a comprehensive safety audit of City facilities and work practices and to implement a City-wide safety program. Since that time, Du-All Safety, LLC has been the safety administrator for the City of Richmond. The City’s current contract with Du-All Safety, LLC is set to expire June 30, 2022.

Services required for the safety program include coordinating and conducting the monthly City-wide Safety Committee meetings; conducting facility safety inspections on a quarterly, semi-annual, or yearly basis as specified for the identified facility; assisting departments with new safety issues and resolving concerns; and providing monthly safety training in a variety of topics including hazardous waste handling; confined space; lockout/tagout; hot work/welding; bloodborne pathogens; emergency evacuations; driver safety; fall protection; illness and injury prevention plan; first aid/CPR/AED; hearing conservation; respiratory protection; traffic control safety; powered personnel lifts; scaffold safety; as well as any other safety training need that arises.

The City is currently receiving approximately 70 hours of safety consulting services per month. The contracted fees have been increased three percent annually over the previous year’s rate. The hourly rates in the contract, as amended, continue increasing at three percent for year four (4) and year (5).

Du-All Safety,
LLC
Hourly Rate Hours per Month Annual Fee
Year 1 FY19/20 $149.26 80 $143,290
Year 2 FY20/21 $153.74 80 $147,590
Year 3 FY21/22 $158.35 80 $152,016
Year 4 FY22/23 $163.10 80 $156,261
Year 5 FY23/24 $167.99 80 $161,270

CONCLUSION:

The City has been satisfied with Du-All Safety, LLC and it is recommended that an amendment extending the contract with Du-All Safety, LLC be approved.

DOCUMENTS ATTACHED:

Attachment 1 – Original Contract
Attachment 2 – Amendment to the Contract

CITY OF RICHMOND

CONTRACT AMENDMENT
Department: Project Manager:

Project Manager E-mail:

Project Manager Phone No:

P.R. No: Vendor No: P.O./Contract No:

Description of Services:

Amendment No. ___ modifies the: (2nd or subsequent amendments attach Amendment History page)

Term, Payment Limit and Service Plan
Payment Limit and Service Plan

Term and Service Plan
Service Plan
The parties to this Contract Amendment do mutually agree and promise as follows:

1. Parties. The parties to this Contract Amendment are the City of Richmond, California, a municipal corporation (City), and the following named Contractor:

Company Name:

Street Address:

City, State, Zip Code:

Contact Person:

Telephone: Email:

Business License No: / Expiration Date:

A California [ ] corporation, [ ] limited liability corporation [ ] general partnership, [ ] limited partnership, [ ] individual, [ ] non-profit corporation, [ ] individual dba as [specify:]
[ ] other [specify:]

2. Purpose. This Contract Amendment is being entered into to amend the Contract between City and Contractor which was approved by the City Council of the City of Richmond or executed by the City Manager on , which original term commenced on and terminates with an original contract payment limit of $ . Said contract shall hereinafter be referred to as the "Original Contract" and is incorporated herein by reference.

3. Original Contract Provisions. The parties hereto agree to continue to abide by those terms and conditions of the Original Contract, and any amendments thereto, which are unaffected by this Contract Amendment.

Contract Amendment/EJ/TE 09-26-07

4. Amendment Provisions. This Contract Amendment is subject to the Amendment Provisions attached hereto, which are incorporated herein by reference, and which control over any conflicting provisions of the Original Contract, or any amendment thereto.

5. City of Richmond Business License Active Status Maintained. Pursuant to Municipal Code Section 7.04.030, the Contractor must maintain its City of Richmond business license for this Contract Amendment to be deemed to be in effect.

6. Insurance Coverage Updated and Maintained. Pursuant to the Original Contract, the Contractor shall provide the City with updated insurance certificates, and the Contractor shall maintain insurance coverage, for this Contract Amendment to be deemed to be in effect.

7. Signatures. These signatures attest the parties’ agreement hereto:

CITY OF RICHMOND, CALIFORNIA
a municipal corporation

By _______________________

Title:

I hereby certify that the Original Contract
and this Amendment have been approved
by the City Council or executed by the City
Manager.

By _______________________
City Clerk

Approved as to form:

By_______________________
City Attorney

List of Attachments:

1. Amendment Provisions

2. Updated Insurance Certificates

CONTRACTOR:

______________________________

(*The Corporation Chairperson of the Board, President or Vice-President should sign on the line below.)

By____________________________

Title:________________________

(*The Corporation Chief Financial Officer, Secretary or Assistant Secretary should sign on the line below.)

By:___________________________

Title:________________________

(NOTE: Pursuant to California Corporations
Code Section 313, if Contractor is a
corporation or nonprofit organization, this
Contract (1) should be signed by the
Chairperson of the Board, President or
Vice-President
and the Chief Financial
Officer, Secretary or Assistant Secretary; (2)
should have both signatures conform to
designated representative groups pursuant
to Corporations Code Section 313.

Contract Amendment between the City of Richmond and

Amendment No. P.O./Contract No.

AMENDMENT PROVISIONS (TERM, PAYMENT LIMIT AND SERVICE PLAN)

1. Paragraph 2 (Term) of the Original Contract is hereby amended to extend the Contract term. Paragraph 2 of the Original Contract is amended to read as follows:

"2. Term. The effective date of this Contract is

____________________________________________________________ (Insert original contract commencement date)

and it terminates

___________________________________________________.
(Insert new contract termination date)

unless sooner terminated as provided herein."

2. Paragraph 3 (Payment Limit) of the Original Contract is hereby amended to increase the payment limit by $ . Paragraph 3 of the Original Contract is amended to read as follows:

"3. Payment Limit. City's total payments to Contractor under this Contract shall not exceed $ including expenses."

“The City of Richmond shall not pay for services that exceed the Contract Payment Limit without the prior written approval of the City Manager if the total Contract amount does not exceed $10,000 or without the prior approval of the City Council if the total Contract amount is over $10,000.”

3. The Service Plan (Exhibit A) of the Original Contract is hereby amended to include the following tasks and/or services:

Contract Amendment/EJ/TE 9-26-07

Contract Amendment between the City of Richmond and

Amendment No. P.O./Contract No.

AMENDMENT PROVISIONS (SERVICE PLAN)
(CONTRACTOR’S OBLIGATION’S)

The Service Plan (Exhibit A) of the Original Contract is hereby amended to include the following tasks and/or services:

Contract Amendment/EJ/TE 9-26-07

Contract Amendment between the City of Richmond and

Amendment No. P.O./Contract No.

AMENDMENT PROVISIONS (AMENDMENT HISTORY)

The first Contract Amendment was approved by City Council of the City of Richmond or executed by the City Manager on for one or more of the following provisions (check those that apply):

Increased contract payment limit by $ ________________for a payment limit not to exceed $ _________________________.

Term Amendment (insert new termination date):________________________

Service Plan

The second Contract Amendment was approved by City Council of the City of Richmond or executed by the City Manager on for one or more of the following provisions (check those that apply):

Increased contract payment limit by $ ________________for a payment limit not to exceed $ _________________________.

Term Amendment (insert new termination date):________________________

Service Plan

The third Contract Amendment was approved by City Council of the City of Richmond or executed by the City Manager on for one or more of the following provisions (check those that apply):

Increased contract payment limit by $ ________________for a payment limit not to exceed $ _________________________.

Term Amendment (insert new termination date):________________________

Service Plan

The fourth Contract Amendment was approved by City Council of the City of Richmond or executed by the City Manager on for one or more of the following provisions (check those that apply):

Increased contract payment limit by $ ________________for a payment limit not to exceed $ _________________________.

Term Amendment (insert new termination date):________________________

Service Plan

The fifth Contract Amendment was approved by City Council of the City of Richmond or executed by the City Manager on for one or more of the following provisions (check those that apply):

Increased contract payment limit by $ ________________for a payment limit not to exceed $ _________________________.

Term Amendment (insert new termination date):________________________

Service Plan

___ Exhibit F
___ Section 8
City of Richmond - Insurance Requirements - Type 2:

Professional Services

Type 2 – Page 1 of 3

Revised: September 2011
In all instances where CONTRACTOR or its representatives will provide professional services (architects, engineers, construction management, counselors, medical professionals, hospitals, clinics, attorneys, consultants, accountants, etc.) to the City of Richmond (City), the City requires the following MINIMUM insurance requirements and limits.

CONTRACTOR shall procure and maintain for the duration of the contract, agreement, or other order for work, services or supplies, insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder and the results of that work by the CONTRACTOR, its agents, representatives, employees or subcontractors. Maintenance of proper insurance coverage is a material element of the contract. Failure to maintain or renew coverage or to provide evidence of renewal may be treated by the City as a material breach of contract.

CONTRACTOR agrees that in the event of loss due to any of the perils for which it has agreed to provide Commercial General Liability insurance, CONTRACTOR shall look solely to its insurance for recovery.

CONTRACTOR hereby grants to CITY, on behalf of any insurer providing Commercial General Liability insurance to either CONTRACTOR or CITY with respect to the services of CONSULTANT herein, a waiver of any right to subrogation which any such insurer of said CONTRACTOR may acquire against the CITY by virtue of the payment of any loss under such insurance.

Original, signed certificates and original, separate policy endorsements, naming the City as an additional insured for general liability coverage, as well as a waiver of subrogation for Workers’ Compensation insurance, shall be received and approved by the City before any work may begin. However, failure to do so shall not operate as a waiver of these insurance requirements.

City reserves the right to modify or require additional coverages for specific risk exposures depending on scope of CONTRACTORS work.

Minimum coverage is detailed below. The policy limits of coverage shall be made available to the full limits of the policy. The minimum limits stated herein shall not serve to reduce the policy limits of coverage of CONTRACTOR.

Minimum Scope of Insurance – the following forms shall be provided and coverage shall be at least as broad as the following:

1. Insurance Services Office Commercial General Liability coverage (ISO Occurrence Form CG 0001), and including coverage for bodily and personal injury, property damage, and products and completed operations (if applicable).

2. Insurance Services Office Automobile Liability coverage (ISO Form CA 0001, Code 1, Any Auto).

3. Original and Separate Additional Insured Endorsement for General Liability (ISO Form CG 20 10 11/85 or its equivalent) with primary and non-contributory language.

4. Workers’ Compensation Insurance as required by the State of California including Employer’s Liability coverage.

5. Original and Separate Waiver of Subrogation for Workers’ Compensation insurance.

6. Professional Liability or Errors & Omissions Liability Insurance appropriate to the CONTRACTOR’s profession (if required.)

Required Coverage Minimum Limits
Workers’ Compensation and
Employers’ Liability
Statutory limits as required by the State of California including $1 million Employers’ Liability per accident, per employee for bodily injury or disease.

If CONTRACTOR is self-insured, provide a certificate of Permission to Self- Insure, signed by the California Department of Industrial Relations and Self- Insurance. If contractor is a sole proprietor (has no employees) than contractor must sign “Contractor Release of Liability” found at:
http://www.ci.richmond.ca.us/index.aspx?nid=61.

General Liability
(primary and excess limits
combined)
$2,000,000 per occurrence for bodily injury, personal injury and property damage. If the policy includes a general aggregate, either the general aggregate shall apply separately to this project, service or location or the minimum required aggregate limit shall be twice the per occurrence limit ($4 million aggregate limit).

Policy shall be endorsed to name the City of Richmond as an additional insured per the conditions detailed below.

___ Exhibit F
___ Section 8
City of Richmond - Insurance Requirements - Type 2:

Professional Services

Type 2 – Page 2 of 3

Revised: September 2011
Automobile Liability $1,000,000 per occurrence for bodily injury and property damage.

PROJECT COST R EQUIRED LIMIT
$0 - $1 million $1 million p/o
$1 million - $5 million $2 million p/o
Over $5 million $5 million p/o

Professional Liability or Errors &
Omissions Liability –
Required for all professionals
including architects, engineers,
consultants, construction
management, counselors, medical
professionals, hospitals, clinics,
attorneys and accountants, & other
consultants as may be required by
the City.

Required Policy Conditions
Additional Insured Endorsement

Applicable to General Liability coverage.

The City of Richmond, its officers, officials, employees, agents and volunteers are to be named as additional insureds for all liability arising out of the operations by or on behalf of the named insured including bodily injury, deaths and property damage or destruction arising in any respect directly or indirectly in the performance of this contract.

ISO form CG 20 10 (11/85) or its equivalent is required. If the Contractor is supplying their product or providing a service then the endorsement must not
exclude products and completed operations
coverage. If it does, then CG 20 37 (10/01) is also required.

SAMPLE Endorsements can be found at
http://www.ci.richmond.ca.us/index.aspx?nid=61
.

Primary and Noncontributory The contractor’s insurance coverage must be primary coverage as it pertains to the City, its officers, officials, employees, agents and volunteers. Any insurance or self insurance maintained by the City is wholly separate from the insurance of the contractor and in no way relieves the contractor from its responsibility to provide insurance.

Waiver of Subrogation
Endorsement Form
Contractor’s insurer will provide a Waiver of Subrogation in favor of the City for Workers’ Compensation Insurance during the life of this contract.

SAMPLE Endorsements can be found at
http://www.ci.richmond.ca.us/index.aspx?nid=61.

Deductibles and Self-Insured
Retentions
Any deductible or self-insured retention must be declared to and approved by the City. At the option of the City either the insurer shall reduce or eliminate such deductibles or self-insured retention as respects the City or the CONTRACTOR shall procure a financial guarantee in an amount equal to the deductible or self-insured retention guaranteeing payment of losses and related investigations, claims administration and defense expenses.

Contractor is responsible for satisfaction of the deductible and/or self-insured retention for each loss.

A. M. Best Rating A:VII or Better. If the A.M. Best Rating falls below the required rating, CONTRACTOR must replace coverage immediately and provide notice to City.

Umbrella/Excess Liability Policies
If an Umbrella or Excess Liability Policy is used to meet the liability limits, coverage shall be as broad as specified for underlying coverage’s and cover those insured in the underlying policies.

___ Exhibit F
___ Section 8
City of Richmond - Insurance Requirements - Type 2:

Professional Services

Type 2 – Page 3 of 3

Revised: September 2011
Claims-Made Policies
If any insurance policy is written on a claims-made form: 1) the retroactive date must be shown, and must be before the date of the contract or the beginning of contract work. 2) Insurance must be maintained and evidence of insurance must be provided for at least five (5) years after completion of the contract of work. 3) If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a retroactive date prior to the contract effective date, the Contractor must purchase an extended period coverage for a minimum of five (5) years after completion of contract work.

Subcontractors

CONTRACTOR
shall include all subcontractors as insured under its policies or shall furnish to the City for review and approval, separate certificates and endorsements for each subcontractor. All coverage for subcontractors shall be subject to all of the requirements stated herein.

CONTRACTOR agrees to defend and indemnify the City of Richmond for any damage resulting to it from failure of either CONTRACTOR or any subcontractor to take out or maintain the required insurance policies.

The fact that
insurance is obtained by CONTRACTOR, and/or CONTRACTOR’s subcontractors, will not be deemed to release or diminish the liability of CONTRACTOR, including, without limitation, liability under the indemnity provisions of this contract. Damages recoverable by CITY from CONTRACTOR or any third party will not be limited by the amount of the required insurance coverage.

Verification of Coverage
All original certificates and endorsements shall be received and approved by the City before work may begin .

The City of Richmond reserves the right to require complete, certified copies of all required insurance policies including endorsements affecting the coverage at any time.

Original insurance certificates and required policy endorsements shall be mailed or delivered to the Designated Project Manager for the City of Richmond.

Insurance certificates and endorsements may be faxed to the Designated Project Manger. However, CONTRACTOR must mail the original certificates and endorsements to Designated Project Manager once faxed.

Continuous Coverage
CONTRACTOR shall maintain the required insurance for the life of the contract. Should the CONTRACTOR cease to have insurance as required during this time, all work by the CONTRACTOR pursuant to this agreement shall cease until insurance acceptable to the City is provided. In the event that CONTRACTOR fails to comply with the City’s insurance requirements, the City may take such action as it deems necessary to protect the City’s interests. Such action may include but is not limited to termination of the contract, withholding of payments, or other actions as the City deems appropriate.

If services or the scope of work extend beyond the expiration dates of the required insurance policies initially approved by the City, CONTRACTOR must provide updated certificates and endorsements indicating that the required coverage, terms and conditions are still in place. Renewal certificates and updated endorsements shall be mailed to the Designated Project Manager.

Cancellation
CONTRACTOR shall ensure that coverage shall not be cancelled, reduced or otherwise materially changed except after thirty (30) days’ prior written notice has been given to the City.

Reporting Requirements

Any failure to comply with reporting or other provisions of the policies including breaches of warranties shall not affect coverage provided to the City, its officers, officials, employees or volunteers.

Consistent with Public Policy
The insuring provisions, insofar as they may be judged to be against public policy shall be void and unenforceable only to the minimum extent necessary so that the remaining terms and provisions herein may be consistent with public policy and thus enforceable.

June 21, 2022

Information Technology

DATE: June 21, 2022
TO: Mayor Butt and Members of the City Council
FROM:

Sue Hartman, Director of Information Technology

Subject:

Approve the Purchase of a Tabbing Machine for use by
the City’s Duplicating Mail Division
FINANCIAL IMPACT: Funds are available in the Duplicating Mail Division of the Information Technology Department Fiscal Year 2021-
2022 – 01263090-400601

PREVIOUS COUNCIL
ACTION:

None.

STATEMENT OF THE
ISSUE:

The City’s Duplicating Mail room service is required by the United States Postal Service (USPS) to have sealing tabs placed on each folded newsletter processed through their bulk mail facility. An automated tabbing machine
has been identified as a solution to replace the current manual process.

RECOMMENDED ACTION:

APPROVE the purchase of a tabbing machine from
Saddle Point Systems in an amount not to exceed
$30,000 – Information Technology Department (Sue
Hartman 510-620-6874).

DISCUSSION:

The City of Richmond supports neighborhood councils by funding printing services and postage for neighborhood newsletters and flyers. Neighborhood councils are responsible for picking up print jobs, preparing each piece for mailing, and processing AGENDA
REPORT

June 21, 2022
the mail with a technician at the bulk mail facility. Mail preparation for folded pieces includes sealing each piece with two wafer seals.

The number of households in each neighborhood in Richmond varies widely, with some exceeding 4,000 households. Sealing can result in countless hours of manual labor for neighborhood volunteers. In 2021, neighborhood councils began advocating for a sealing machine to help automate this process.

The City’s Duplicating Mail room service is required by the United States Postal Service (USPS) to have sealing tabs placed on each folded newsletter processed through their bulk mail facility. An automated tabbing machine has been identified as a solution to replace the current manual process. City staff reviewed multiple quotes from potential vendors and have selected the lowest cost vendor, Saddle Point Systems. City staff recommends approval of the purchase of this tabbing machine in order to automate the current manual process.

DOCUMENTS ATTACHED:

Attachment 1 – Contract with Saddle Point Systems
Attachment 2 – Saddle Point Systems Quote

CITY OF RICHMOND

STANDARD CONTRACT

Department: Project Manager:

Project Manager E-mail:

Project Manager Phone No:

PR No: Vendor No: P.O./Contract No:

Description of Services:

The parties to this STANDARD CONTRACT do mutually agree and promise as follows:

1. Parties. The parties to this Contract are the City of Richmond (herein referred to as the “City”) and the following named Contractor:

Company Name:

Street Address:

City, State, Zip Code:

Contact Person:

Telephone: Email:

Business License No: / Expiration Date:

A California [ ] corporation, [ ] limited liability corporation [ ] general partnership, [ ] limited partnership, [ ] individual, [ ] non-profit corporation, [ ] individual dba as [specify:] , [ ] other [specify:]

2. Term. The effective date of this Contract is and it terminates unless terminated as provided herein.

3. Payment Limit. City’s total payments to Contractor under this Contract shall not exceed $ . City shall not pay for services that exceed the Contract Payment Limit unless a contract amendment has been approved by the City Council or City Manager.

4. Contractor’s Obligations. Contractor shall provide those services and carry out that work described in the Service Plan (Exhibit A) which is attached hereto and is incorporated herein by reference, subject to all the terms and conditions contained or incorporated herein.

5. City's Obligations. City shall make to the Contractor those payments described in the Payment Provisions (Exhibit B) which are attached hereto and are incorporated herein by reference, subject to all the terms and conditions contained or incorporated herein.

6. Authorized Representatives and Notices. This Contract is subject to the Authorized Representatives and Notices Provisions (Exhibit C) which are attached hereto and are incorporated herein by reference.

7. General Conditions. This Contract is subject to the General Conditions (Exhibit D) which are attached hereto and are incorporated herein by reference, subject to all the terms and conditions contained or incorporated herein.

8. Special Conditions. This Contract is subject to the Special Conditions (Exhibit E) (if any) which are attached hereto and are incorporated herein by reference, subject to all the terms and conditions contained or incorporated herein. (Note:
other than Public Works contracts, the City will agree to Special Conditions only in unusual circumstances.)

9. Insurance Provisions. This Contract is subject to the Insurance Provisions (Exhibit F) which are attached hereto and are incorporated herein by reference.

10. Signatures. These signatures attest the parties' Contract hereto:

CITY OF RICHMOND CONTRACTOR:
a municipal corporation

By:
(* The Corporation Chairperson of the Board,
President or Vice President should sign below)

Title: By:

I hereby certify that this Contract Title:
has been approved by City Council.

Date Signed:

B y :

City Clerk
(* The Corporation Chief Financial Officer,
Secretary or Assistant Secretary should sign below)
Approved as to form:

B y :

B y : T i t l e :

City Attorney
Date Signed:

(NOTE: Pursuant to California Corporations
Code Section 313, if Contractor is a corporation
or nonprofit organization, this Contract (1) must
be signed by (a) the Chairperson of the Board,
President or Vice-President
and (b) the
Secretary any Assistant Secretary, the Chief
Financial Officer or any Assistant Treasurer.

LIST OF ATTACHMENTS:

Service Plan Exhibit A
Payment Provisions Exhibit B
Authorized Representatives and Notices Exhibit C
General Conditions Exhibit D
Special Conditions Exhibit E
Insurance Provisions Exhibit F
Standard Contract/EJ/TE 9-26-07

For the Contract between the City of
Richmond and

EXHIBIT A

SERVICE PLAN

Contractor shall, to the satisfaction of the , perform the following services and be compensated as outlined below:

For the Contract between the City of
Richmond and

EXHIBIT B

PAYMENT PROVISIONS

{PLEASE NOTE THAT THE CITY OF RICHMOND SHALL NOT PAY FOR SERVICES

THAT EXCEED THE CONTRACT PA YMENT LIMIT UNLESS A CONTRACT

AMENDMENT HAS BEEN APPROVED BY THE CITY COUNCIL OR THE CITY MANAGER}

1. Provided Contractor is not in default under this Contract, Contractor shall be compensated as provided below.

2. Any and all payments made pursuant to this Contract shall be subject to the Contract Payment Limit. The Payment Limit includes expenses (phones, photo copying, meals and travel etc). Invoices, shall be adequately detailed, based on accurate records, and be in a form reasonably satisfactory to the City. Contractor may be required to provide back-up material upon request.

3. Contractor shall submit timely invoices to the following address:

Attention: City of Richmond, Finance Department - Accounts Payable Project Manager: Department:

PO Box 4046
Richmond, CA 94804-0046

4. All invoices that are submitted by Contra ctor shall be subject to the approval of the City’s Project Manager, before payments shall be authorized.

5. The City will pay invoice(s) within 45 days a fter completion of services to the City’s satisfaction. The City shall not pay late fees or interest.

6. A Richmond business license shall be obtained before any payment under this Contract shall be authorized and the business license must be kept current during the term of this Contract for payments to continue to be authorized.

7. All insurance coverage required by this Contract shall be provided by the Contractor before this Contract shall be executed by the City. The insurance coverage must be kept current during the term of this Contract for payments to continue to be authorized.

For the Contract between the City of
Richmond and

EXHIBIT C

AUTHORIZED REPRESENTATIVES AND NOTICES

1. Notices
. All notices, demands, statements, or communications provided for by this Contract shall be in writing and may be delivered by deposit in the United States mail, postage prepaid. Notices to the City shall be addressed to the Department Head and (as delineated below in section 1.1) to the project manager responsible for the administration of or the supervision of the scope of work under this Contract. Notices to the Contractor shall be addressed to the party designated by Contractor (as delineated below in section 1.2). Notice shall be deemed delivered (a) upon personal delivery; (b) as of the fifth business day after mailing by United States certified mail, postage prepaid, addressed to the proper party; or (c) as of 12:00 p.m. on the second business day immediately after the day it is deposited with and accepted by Federal Express, or a similar overnight courier service, addressed to the proper party and marked for next business day morning delivery. For the purposes of this Contract, a "business day" means any day Monday through Friday that is not a holiday recognized by the federal government or the State of California.

1. 1 CITY hereby designates as its Authorized Representative the Project Manager whose name and address are as follows:

City of Richmond

Richmond, CA 94804-0046

1. 2 CONTRACTOR hereby designates as its Authorized Representative the Project Manager whose name and address are as follows:

General Conditions/EJ/TE 01-19-11 1 of 13

EXHIBIT D

GENERAL CONDITIONS

1. Independent Contractor . Contractor acknowledges, represents and warrants that Contractor is not a regular or temporary employee, joint venturer or partner of the City, but rather an independent Contractor. This Contract shall not be construed to create an agency, servant, employee, partnership, or joint venture relationship. As an independent Contractor, Contractor shall have no authority to bind City to any obligation or to act as City's agent except as expressly provided herein. Due to the independent Contractor relationship created by this Contract, City shall not withhold state or federal income taxes, the reporting of which shall be Contractor's sole responsibility.

2. Brokers . Contractor acknowledges, represents and warrants that Contractor has not hired, retained or agreed to pay any entity or person any fee, commission, percentage, gift, or any other consideration, contingent upon or resulting from the award or making of this Contract.

3. City Property . The rights to applicable plans, drawings, reports, calculations, data, specifications, videos, graphics or other materials prepared for or obtained pursuant to this Contract, which, upon request, are to be delivered to City within a reasonable time, shall be deemed assigned to City. If applicable, Contractor shall prepare check prints upon request. Notwithstanding the foregoing, Contractor shall not be obligated to provide to City proprietary software or data which Contractor has developed or had developed for Contractor's own use; provided, however, that Contractor shall, pursuant to Section 15 below, indemnify, defend and hold harmless City from and against any discovery or Public Records Act request seeking the disclosure of such proprietary software or data.

4. Patents, Trademarks, C opyrights and Rights in Data
. Contractor shall not
publish or transfer any materials, discoveries, developments, concepts, designs, ideas, know how, improvements, inventions and/or original works of authorship resulting from activities supported by this Contract without the express prior written consent of the City Manager. If anything resulting from activities supported by this Contract is patentable, trademarkable, copyrightable or otherwise legally protectable, City reserves the exclusive right to seek such intellectual property rights. Notwithstanding the foregoing, Contractor may, after receiving City's prior written consent, seek patent, trademark, copyright or other intellectual property rights on anything resulting from activities supported by this Contract. However, City reserves, and Contractor irrevocably grants, a nonexclusive, fully paid-up, royalty-free, assumable, perpetual, worldwide license, with the right to transfer, sublicense, practice and exploit said license and the right to make, have made, copy, modify, make derivative works of, use, sell,

General Conditions/EJ/TE 01-19-11 2 of 13

import, and otherwise distribute under all applicable intellectual properties without restriction of any kind said license.

Contractor further agrees to assist City, at City's expense, in every proper way to secure the City’s rights in any patents, trademarks, copyrights or other intellectual property rights relating thereto, including the disclosure to City of all pertinent information and data with respect thereto. Contractor shall also assist City in the execution of all applications, specifications, oaths, assignments, recordations, and all other instruments which City shall deem necessary in order to apply for, obtain, maintain and transfer such rights, or if not transferable, to waive such rights. Contractor shall further assist City in the execution of all applications, specifications, oaths, assignments, recordations and all other instruments which City shall deem necessary in order to assign and convey to City, and any assigns and nominees the sole and exclusive right, title and interest in and to any patents, trademarks, copyrights or other intellectual property rights relating thereto. Contractor further agrees that its obligation to execute or cause to be executed, when it is in Contractor's power to do so, any such instruments or papers shall continue during and at all times after the end of Contractor's services and until the expiration of the last such intellectual property right. Contractor hereby irrevocably designates and appoints City, and its duly authorized officers, agents and servants, as its agent and attorney-in-fact, to act for and in its behalf and stead to execute and file any such applications and to do all other lawfully permitted acts to further the application for, prosecution, issuance, maintenance or transfer of letters of patents, copyright and other registrations. This power of attorney is coupled with an interest and shall not be affected by Contractor's subsequent incapacity.

5. Inspection
. Contractor's performance, place of business and records pertaining to this Contract are subject to monitoring, inspection, review and audit by authorized representatives of the CITY, the State of California, and the United States Government.

If the project or services set forth in Exhibit A shall be performed on City or other public property, City shall have the right to inspect such work without notice. If such project or services shall not be performed on City or other public property, City shall have the right to inspect such work upon reasonable notice.

6. Services
. The project or services set forth in Exhibit A shall be performed to the full satisfaction and approval of City. In the event that the project or services set forth in Exhibit A are also itemized by price, City, in its sole discretion, may, upon notice to Contractor, delete certain items or services set forth in Exhibit A, in which case there shall be a corresponding reduction in the amount of compensation paid to Contractor.

General Conditions/EJ/TE 01-19-11 3 of 13

Contractor shall, at its own cost and expense, furnish all facilities and equipment necessary for Contractor to complete the project or perform the services required herein, unless otherwise provided in Exhibit A.

7. Records
. Contractor shall keep and make available for inspection and copying by authorized representatives of the City, the State of California, and the United States Government, the Contractor's regular business records and such additional records pertaining to this Contract as may be required by the City.

Contractor shall retain all documents pertaining to this Contract for a period of five (5) years after this C ontract's termination (or for any further period that is required by law) and until all Fede ral or State audits are complete and exceptions resolved for this contract's funding period. Upon request, CONTRACTOR shall make thes e records available to authorized representatives of the CITY, the State of California, and the United States Government.

Contractor shall keep full and detailed accounts, maintain records, and exercise such controls as may be necessary for proper financial management under this Contract. The Contractor’s accounting and control systems shall be satisfactory to City. Contractor's accounting systems shall conform to generally accepted accounting principles and all records shall provide a breakdown of total costs charged under this Contract, including properly executed payrolls, time records, utility bills, invoices and vouchers. The City shall be afforded prompt access to Contractor's records, books, and Contractor shall preserve such project records for a period of at least five (5 years after the termination of this Contract , or for such longer period as may be required by law.

Contractor shall permit City and its authorized representatives and accountants to inspect, examine and copy Contractor's books, records, accounts, correspondence, instructions, drawings, receipts, subcontracts, purchase orders, vouchers, memoranda and other data relating to the project or services set forth in Exhibit A, and any and all data relevant to this Contract at any reasonable time for the purpose of auditing and verifying statements, invoices, or bills submitted by Contractor pursuant to this Contract and shall provide such assistance as may be reasonably required in the course of such inspection. Contractor shall also allow City access to the record keeping and accounting personnel of Contractor.

City further reserves the right to examine and re-examine said books, records, accounts, and data during the five (5 year period following the termination of this Contract; and Contractor shall in no event dispose of, destroy, alter, or mutilate said books, records, accounts, and data in any manner whatever for five (5 years after the termination of this Contract.

General Conditions/EJ/TE 01-19-11 4 of 13

Pursuant to California Government Code § 10527, the parties to this Contract shall be subject to the examination and audit of representatives of the Auditor General of the State of California for a period of three (3) years after final payment under this Contract. The examination and audit shall be confined to those matters connected with the performance of this Contract including, but not limited to, the cost of administering this Contract.

8. Changes and Extra Work . All changes and/or extra work under this Contract shall be performed and paid for in accordance with the following:

Only the City Council or the City Manager may authorize extra and/or changed work. Contractor expressly recognizes that other City personnel are without authorization to either order extra and/or changed work or waive contract requirements. Failure of Contractor to secure the authorization for such extra and/or changed work shall constitute a waiver of any and all right to adjustment in contract price due to such unauthorized work and Contractor thereafter shall be entitled to no compensation whatsoever for performance of such extra and/or changed work.

If Contractor is of the opinion that any work which Contractor has been directed to perform is beyond the scope of this Contract and constitutes extra work, Contractor shall promptly notify City of the fact. The City shall make a determination as to whether or not such work is, in fact, beyond the scope of this Contract and constitutes extra work. In the event that City determines that such work does constitute extra work, City shall provide extra compensation to Contractor on a fair and equitable basis. A change order or Contract Amendment providing for such compensation for extra work shall be negotiated between City and Contractor and executed by Contractor and the appropriate City official.

In the event City determines that such work does not constitute extra work, Contractor shall not be paid extra compensation above that provided herein and if such determination is made by City staff, said determination may be appealed to the City Council; provided, however, a written appeal must be submitted to the City Manager within five (5) days after the staff's determination is sent to Contractor. Said written appeal shall include a description of each and every ground upon which Contractor challenges the staff's determination.

9. Additional Assistance
. If this Contract requires Contractor to prepare
plans and specifications, Contractor shall provide assistance as necessary to resolve any questions regarding such plans and specifications that may arise during the period of advertising for bids, and Contractor shall issue

General Conditions/EJ/TE 01-19-11 5 of 13

any necessary addenda to the plans and specifications as requested. In the event Contractor is of the opinion that City's requests for addenda and assistance is outside the scope of normal services, the parties shall proceed in accordance with the changes and extra work provisions of Section 8 of these General Conditions.

10. Professional Ability. Contractor acknowledges, represents and warrants that Contractor and its employees are skilled and able to competently provide the services hereunder, and possess all professional licenses, certifications, and approvals necessary to engage in their occupations.

City has relied upon the professional ability and training of Contractor as a material inducement to enter into this Contract. Contractor shall perform in accordance with generally accepted professional practices and standards of Contractor's profession. In the event that City, in its sole discretion, desires the removal of any person employed or retained by Contractor to perform services hereunder, such person shall be removed immediately upon receiving notice from City.

11. Business License
. Contractor shall obtain a Richmond Business License
before performing any services required under this Contract. The failure to so obtain such license shall be a material breach of this Contract and grounds for immediate termination by City; provided, however, that City may waive the business license requirement in writing under unusual or extraordinary circumstances without necessitating any modification of this Contract to reflect such waiver.

12. Termination Without Default. Notwithstanding any provision herein to the contrary, City may, in its sole and absolute discretion and without cause, terminate this Contract at any time prior to completion by Contractor of the project or services hereunder, immediately upon written notice to Contractor. Contractor may terminate this Contract at any time in its sole and absolute discretion and without cause upon 30 days' written notice to City. In the event of termination by either party, Contractor shall be compensated for: (1) all authorized work satisfactorily performed prior to the effective date of termination; (2) necessary materials or services of others ordered by Contractor for this Contract, prior to receipt of notice of termination, irrespective of whether such materials or services of others have actually been delivered, provided that Contractor is not able to cancel such orders. Compensation for Contractor in such event shall be determined by City in accordance with the percentage of the project or services completed by Contractor; and all of Contractor's finished or unfinished work product through the time of the City's last payment shall be transferred and assigned to City. Additionally, in the event of such termination, the City may proceed with the work in any reasonable manner it chooses.

General Conditions/EJ/TE 01-19-11 6 of 13

13. Termination in the Event of Default. Should Contractor fail to perform any of its obligations hereunder, within the time and in the manner provided or otherwise violate any of the terms of this Contract, City may immediately terminate this Contract by giving written notice of such termination, stating the reasons for such termination. Contractor shall be compensated as provided in Section 12 of these General Conditions; provided, however, there shall be deducted from such amount the amount of damage, including attorney's fees, expert witness fees and costs, if any, sustained by City by virtue of Contractor's breach of this Contract. Additionally, in the event of such termination, the City may proceed with the work in any reasonable manner it chooses.

14. Conflict of Interest. Contractor acknowledges, represents and warrants that Contractor shall avoid all conflicts of interest (as defined under any federal, state or local statute, rule or regulation, or at common law) with respect to this Contract. Contractor further acknowledges, represents and warrants that no City official or employee has any economic interest, as defined in Title 2, California Code of Regulations §§ 18703.1 through 18703.5, with Contractor that would invalidate this Contract. Contractor acknowledges that in the event that Contractor shall be found by any judicial or administrative body to have any conflict of interest (as defined above) with respect to this Contract, all consideration received under this Contract shall be forfeited and returned to City forthwith. This provision shall survive the termination of this Contract for one (1) year.

15. Indemnification.

(a) If this Contract is a contract for design professional services subject to California Civil Code Section 2782.8(a) and Contractor is a design professional, as defined in California Civil Code Section 2782.8(b)(2), Contractor shall hold harmless, defend and indemnify the City, its officers, agents, employees, and volunteers from and against any and all claims, damages, losses, and expenses including attorneys’ fees arising out of, or pertaining to, or relating to the negligence, recklessness, or willful misconduct of the Contractor, except where caused by the active negligence, sole negligence, or willful misconduct of the City. To the fullest extent permitted by law, Contractor shall immediately defend and indemnify the City and its officers, agents, employees, and volunteers from and against any and all liabilities, regardless of nature or type, that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Contractor, or its employees, agents, or subcontractors.

Liabilities subject to the duties to defend and indemnify include, without limitation, any and all claims, losses, damages, penalties, fines, and judgments; associated investigation and administrative expenses; defense costs, including but not limited to reasonable attorneys’ fees; court costs; and costs of alternative dispute resolution. Contractor’s obligation to

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indemnify applies unless it is finally adjudicated that the liability was caused by the sole active negligence or sole willful misconduct of an indemnified party.
(b) If this Contract is not a contract for design professional services subject to California Civil Code Section 2782.8(a) or Contractor is not a design professional as defined in California Civil Code Section 2782.8(b)(2), Contractor shall indemnify, defend, and hold harmless the City, its officers, agents, employees and volunteers from any and all claims, suits, or actions of every name, kind and description, brought forth on account of injuries to or death of any person or damage to property arising from or connected with the willful misconduct, negligent acts, errors or omissions, ultra-hazardous activities, activities giving rise to strict liability, or defects in design by Contractor or any person directly or indirectly employed by, or acting as, the agent for Contractor in the performance of this Contract, including the concurrent or successive passive negligence of the City, its officers, agents, employees or volunteers.
(c) It is understood that the duty of Contractor to indemnify and hold harmless includes the duty to defend as set forth in Section 2778 of the California Civil Code. Contractor shall be obligated to defend, in all legal, equitable, administrative, or special proceedings, with counsel approved by the City, the City and its officers, agents, employees, and volunteers, immediately upon tender to Contractor of the claim in any form or at any stage of an action or proceeding, whether or not liability is established. An allegation or determination that persons other than Contractor are responsible for the claim does not relieve Contractor from its separate and distinct obligation to defend under this Section 15. The obligation to defend extends through final judgment, including exhaustion of any appeals. The defense obligation includes an obligation to provide independent counsel if Contractor asserts that liability is caused in whole, or in part, by the negligence or willful misconduct of an indemnified party. (d) The review, acceptance or approval of the Contractor’s work or work product by any indemnified party shall not affect, relieve or reduce the Contractor’s indemnification or defense obligations. This Section 15 survives completion of the services or the termination of this Contract.

The provisions of this Section 15 are not limited by, and do not affect, the provisions of this Contract relating to insurance.
(e) Acceptance of insurance certificates and endorsements required under this Contract does not relieve Contractor from liability under this Section

15. This Section 15 shall apply whether or not such insurance policies are determined to be applicable to any such damages or claims for damages.

16. Safety
. Contractor acknowledges that the City is committed to the highest standards of workplace safety. Contractor shall perform all work hereunder in full compliance with applicable local, state and federal safety requirements including but not limited to Occupational Safety and Health Administration requirements, and shall assume sole and complete

General Conditions/EJ/TE 01-19-11 8 of 13

responsibility for the safety of Contractor's employees and any subContractor's employees. If a death, serious personal injury or substantial property damage occurs in connection with the performance of this Contract, Contractor shall immediately notify the City by telephone.

17. Insurance. Insurance requirements are set forth in Exhibit F to this Contract. Contractor shall abide by the insurance requirements set forth in said Exhibit F.

18. Non-Liability of Officials and Employees of the City. No official or employee of the City shall be personally liable for any default or liability under this Contract.

19. Compliance with Laws. Contractor shall comply with all federal, state and local laws, statutes, ordinances, rules and regulations, and the orders and decrees of any courts or administrative bodies or tribunals, with respect to this Contract, including without limitation environmental laws, employment discrimination laws and prevailing wage laws. Compliance under this provision includes compliance with all provisions of the Richmond Municipal Code ("Municipal Code"), including Chapters 2.50, 2.52, 2.56, and 2.60, if applicable.

Contractor acknowledges that under § 2.60.070 of the Municipal Code ("Living Wage Ordinance"), Contractor shall promptly provide to City documents and information verifying its compliance with the Living Wage Ordinance. Also as prescribed in § 2.60.070, Contractor shall notify each of its affected employees with regards to the wages that are required to be paid pursuant to the Living Wage Ordinance.

Contractor shall comply with § 2.28.030 of the Municipal Code, obligating every Contractor or subcontractor under a contract or subcontract with the City for public work or for goods or for services to refrain from discriminatory employment or subcontracting practices on the basis of race, color, sex, sexual orientation, religious creed, national origin or ancestry of any employee, any applicant for employment or any potential subcontractor.

Contractor acknowledges that the City’s Drug Free Workplace Policy, Violence in the Workplace Policy and the Policy Against Workplace Harassment, are available on the City’s website at
http://www.ci.richmond.ca.us/workplacepolicies
. Contractor agrees to
abide by the terms and conditions of said policies.

20. Limitations upon Subcontracting and Assignment. This Contract binds the heirs, successors, assigns and representatives of Contractor. The Contractor shall not enter into subcontracts for any work contemplated

General Conditions/EJ/TE 01-19-11 9 of 13

under this Contract and shall not assign this Contract, nor any portion hereof or monies due or to become due, without the prior written consent of the City Council or its designee.

Contractor acknowledges that the services which Contractor shall provide under this Contract are unique, personal services which, except as otherwise provided herein, Contractor shall not assign or sublet to any other party without the prior written approval of City, which approval may be withheld in City's sole and absolute discretion. In the event that City, in writing, approves any assignment or subletting of this Contract or the retention of subcontractors by Contractor, Contractor shall provide to City upon request copies of each and every subcontract contract prior to the execution thereof by Contractor and subcontractor. Any assignment by Contractor of any or all of its rights under this Contract without first obtaining City's prior written consent shall be a default under this Contract.

The sale, assignment, transfer or other disposition of any of the issued and outstanding capital stock of Contractor (if applicable), or of the interest of any general partner or joint venturer or syndicate member if Contractor is a partnership or joint-venture or syndicate, which shall result in a change of control of Contractor, shall be deemed an assignment. For this purpose, control shall mean fifty percent or more of the voting power or twenty-five percent or more of the assets of the corporation, partnership or joint-venture.

21. Integration
. This Contract constitutes the entire agreement between the parties concerning the subject matter hereof and supersedes any previous oral or written agreement; provided, however, that correspondence or documents exchanged between Contractor and City may be used to assist in the interpretation of the Exhibits to this Contract.

22. Modifications and Amendments. This Contract may be modified or amended only by a change order or Contract Amendment executed by both parties and approved as to form by the City Attorney.

23. Conflicting Provisions. In the event of a conflict between these General Conditions and those of any Exhibit or attachment hereto, these General Conditions shall prevail; provided, however, that any Special Conditions as set forth in Exhibit E shall prevail over these General Conditions. In the event of a conflict between the terms and conditions of any two or more Exhibits or attachments hereto, those prepared by City shall prevail over those prepared by the Contractor, and the terms and conditions preferred by the City shall prevail over those preferred by the Contractor.

24. Non-exclusivity. Notwithstanding any provision herein to the contrary, the services provided by Contractor hereunder shall be non-exclusive, and

General Conditions/EJ/TE 01-19-11 10 of 13

City reserves the right to employ other Contractors in connection with the project.

25. Exhibits. All Exhibits hereto are made a part hereof and incorporated herein by reference; provided, however, that any language in Exhibit A which does not pertain to the project description, proposal, scope of services, or method of compensation (as applicable) , or any corresponding responsibilities of City, shall be deemed extraneous to, and not a part of, this Contract.

26. Force Majeure. Neither party hereto shall be considered in default in the performance of its obligations hereunder to the extent that the performance of such an obligation is prevented or delayed by reason of acts of God, strikes, boycotts, lock-outs, inability to procure materials not related to the price thereof, failure of power, restrictive governmental laws and regulations enacted after the date of this Contract, riots, civil unrest, acts of terrorism, insurrection, war, declaration of a state or national emergency or other reasons of a like nature not within the reasonable control of such party.

27. Time of the Essence. Time is of the essence of this Contract. Contractor and City agree that any time period set forth in Exhibit A represents their best estimates with respect to completion dates and both Contractor and City acknowledge that departures from the schedule may occur.

Therefore, both Contractor and City will use reasonable efforts to notify one another of changes to the schedule. Contractor shall not be responsible for performance delays caused by others, or delays beyond Contractor's control, and such delays shall extend the times for performance of Contractor's work.

28. Confidentiality. Contractor agrees to comply with, and to require its employees, agents and partners to comply with, all applicable State or Federal statutes or regulations respecting confidentially, including but not limited to, the identity of persons served under this Contract, their records, or services provided them, and assures that:

All applications and records concerning any individual made or kept by Contractor or any public officer or agency in connection with the administration of or relating to services provided under this Contract will be confidential, and will not be open to examination for any purposes not directly connected with the administration of such service.

No person will publish or disclose or permit or cause to be published or disclosed, any list of persons receiving services, except as may be required in the administration of such service.

General Conditions/EJ/TE 01-19-11 11 of 13

29. Third Parties. Nothing herein shall be interpreted as creating any rights or benefits in any third parties. For purposes hereof, transferees or assignees as permitted under this Contract shall not be considered "third parties."

30. Governing Law. This Contract shall be construed in accordance with the law of the State of California without regard to principles of conflicts of law.

This Contract is made in Contra Costa County, California, and any action relating to this Contract shall be instituted and prosecuted in the courts of Contra Costa County, California.

31. Nonrenewal. Contractor understands and agrees that there is no representation, implication, or understanding that the services provided by Contractor under this Contract will be purchased or renewed by the City under a new contract following expiration or termination of this Contract, and waives all rights or claims to notice or hearing respecting any failure by City to continue the purchase of all or any failure to continue purchase of all or any such services from Contractor.

32. Claims. Any claim by Contractor against City hereunder shall be subject to Government Code §§ 800 et seq. The claims presentation provisions of said Act are hereby modified such that the presentation of all claims hereunder to the City shall be waived if not made within six months after accrual of the cause of action.

33. Interpretation. This Contract shall be interpreted as if drafted by both parties.

34. Warranty. In the event that any product shall be provided to the City as part of this Contract, Contractor warrants as follows: Contractor possesses good title to the product and the right to transfer the product to City; the product shall be delivered to the City free from any security interest or other lien; the product meets any specifications contained herein; the product shall be free from material defects in materials and workmanship under normal use for a period of one (1) year from the date of delivery; and the product shall be fit for its intended purpose(s). Notwithstanding the foregoing, consumable and maintenance items (such as light bulbs and batteries) shall be warranted for a period of one hundred and eighty (180) days from the date of delivery. All repairs during the warranty period shall be promptly performed by Contractor, at Contractor's expense, including shipping.

35. Severability. In the event that any of the provisions or portions or applications thereof of this Contract are held to be unenforceable or invalid by any court of competent jurisdiction, City and Contractor shall negotiate an equitable adjustment in the provisions of the Contract with a view

General Conditions/EJ/TE 01-19-11 12 of 13

toward effecting the purpose of this Contract, and the validity and enforceability of the remaining provisions or portions or applications thereof, shall not be affected thereby.

36. Authority. City warrants and represents that the signatory hereto (the Mayor of the City of Richmond or the City Manager) is duly authorized to enter into and execute this Contract on behalf of City. The party signing on behalf of Contractor warrants and represents that he or she is duly authorized to enter into and execute this Contract on behalf of Contractor, and shall be personally liable to City if he or she is not duly authorized to enter into and execute this Contract on behalf of Contractor.

37. Waiver. The waiver by City of any breach of any term or provision of this Contract shall not be construed as a waiver of any subsequent breach.

Inspections or approvals, or statements by any officer, agent or employee of the City relating to the Contractor’s performance, or payments therefore, or any combination of these acts, shall not relieve the Contractor’s obligation to fulfill this Contract as prescribed; nor shall the City be thereby stopped from bringing any action for damages or enforcement arising from any failure to comply with any of the terms and conditions of this Contract.

38. Possessory Interest. If this Contract results in the Contractor having possession of, claim to or right to the possession of land or improvements, but does not vest ownership of the land or improvements in the same person, or if this Contract results in the placement of taxable improvements on tax exempt land (Revenue and Taxation Code 107), such interest or improvements may represent a possessory interest subject to property tax, and Contractor may be subject to the payment of property taxes levied on such interest.

39. Performance and Final Acceptance.

Contractor represents that it is experienced, qualified, registered, licensed, equipped, organized and financed to perform the services under this Contract.

Contractor shall perform the services under this Contract with that degree of skill and judgment normally exercised by professional firms performing services of a similar nature in the State of California, and shall be responsible for the professional quality, technical accuracy and coordination of the services it performs under this Contract. In addition to the other rights and remedies which City may have, Contractor shall, at its own expense, correct any services which fail to meet the above standard.

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City shall provide Contractor an opportunity to cure errors and omission which may be disclosed during the review of submittals, with no increase in the authorized Contract Payment Limit. Should Contractor fail to make necessary corrections in a timely manner, such corrections shall be made by the City and the cost thereof shall be charged to Contractor.

If warranted, City shall determine, and Contractor may request such determination, that Contractor has satisfactorily completed performance of this Contract. Upon such determination, City shall issue to Contractor a written Notice of Final Acceptance, after which Contractor shall not incur further costs under this Contract. Contractor shall respond to such Notice of Final Acceptance by executing and submitting to City a Release and Certificate of Final Payment.

40. Survival
. The rights and obligations of the parties which by their nature survive termination or completion of the services covered by this Contract shall remain in full force and effect after termination or completion.

For the Contract between the City of
Richmond and

EXHIBIT E

SPECIAL CONDITIONS

The General Conditions are hereby amended to include the following modifications and/or provisions (if applicable):

For the Contract between the City of
Richmond and

EXHIBIT F

INSURANCE PROVISIONS

During the entire term of this Contract and any extension or modification thereof, the CONTRACTOR shall keep in effect insurance policies meeting the insurance requirements specified in the insurance provisions which are attached hereto and incorporated herein by this reference.

The insurance requirements of Exhibit F are waived because this is just for the purchase of equipment.

April 11, 2012

Quotation for Formax HD 282HF Tabbing System

May 16, 2022

Mr. Adrian Vitangcol
City of Richmond
Information Technology Department
450 Civic Center Plaza
Richmond, CA 94804

Dear Mr. Vitangcol,

Here is a quotation for the Formax HD 282HF Tabbing System:

1 ea Formax HD 282HF Tabbing System with High Volume Heavy Duty Friction Feeder 28,095.00

Special Discount 1,500.00
==========
26,595.00

Tax @ 9.75% 2,593.01
============
Total $29,188.01

This price includes delivery, installation and training, as well as a 12-month full on-site warranty. The warranty includes on-site service, all parts, and labor. The City of Richmond would agree to have only trained employees operate this system under the warranty period.

Thank you very much for the opportunity to quote this equipment.

Jim Kelly

www.saddlepointsystems.com 2608 Ninth Street Berkeley, CA 94710 510/ 649-7500

June 21, 2022

Library and Community Services

DATE: June 21, 2022
TO: Mayor Butt and Members of the City Council
FROM:

LaShonda White, Interim Director of Library and
Community Services
Sam Vaughn, Deputy Director of Community Services –
Office of Neighborhood Safety

Subject:

Contract with Jason Corburn to Provide a New Online
Client Database, System Maintenance, and Support
FINANCIAL IMPACT: The total contract is for $40,000, for the two-year period; however, the annual fees/charges for the services are not anticipated to exceed $20,000 annually (01211013-
400201).

PREVIOUS COUNCIL
ACTION:

Click or tap here to enter text.

STATEMENT OF THE
ISSUE:

The Office of Neighborhood Safety (ONS) is requesting
approval to contract with Jason Corburn to support the
development of a data collection methodology and
outreach worker and client data system for gun violence intervention.

RECOMMENDED ACTION:

APPROVE a contract with Jason Corburn to develop a
client case-management database, that provides for data collection support, maintenance, training, analysis, and reporting for the Office of Neighborhood Safety. The
contract will be for two (2) years with a term from June 22, 2022, through June 30, 2024, and a payment limit not to exceed $40,000 – Community Services Department
(LaShonda White/Sam Vaughn 620-5422).

AGENDA
REPORT

June 21, 2022
DISCUSSION:

The Office of Neighborhood Safety (ONS) seeks to enter into a contract with Jason Corburn, a professor at the University of California at Berkeley (UC Berkeley), to support data collection, client tracking, staff reporting and monitoring, evaluation, database development, and training (Attachment 1). More specifically, this contract will provide a customized data collection methodology for programming related to gun violence intervention. Additionally, the database will allow for the design of crime data visualizations and mapping, improved reporting, and the creation of a web-based “app” or application, that can be installed and managed on mobile devices to streamline the ONS staff’s data capture and communication.

In accordance with Purchasing and Procurement Process requirements, the ONS Staff solicited quotes from four (4) vendors with the following outlined elements that detailed the scope of services, activities, and deliverables for the online secure client-data system:

Data Capture & Tracking: The consultant will design a data system that will provide at least 20 licenses for staff login. The data system will allow for the creation of profiles for clients and fellows, including programming related to Life Management Action Plans, goals, and accomplishments.

The consultant will ensure that the data system will enable staff to conduct general time tracking, location tracking, case/clients contact information, and notes related to work activities, including:

 street outreach
 conflict resolution and mediations
 service referrals
 gun incidents and interventions

Reporting and Analytics: The consultant will ensure the new data system will provide for report generation and data visualizations (e.g., graphs, charts), longitudinal analysis, data disaggregation, and the cross-referencing of client and staff activities.

Support and Maintenance: The consultant will maintain the database and provide technical support training and ensure all data entered in the system is confidential and receives the highest level of encryption.

Quotes were solicited from the four (4) vendors listed below and responses are provided in Attachment 2 – Quote Summary:

 Exponent Partners
 Five Points Solutions
 Jason Corburn
 Neon One