a. Terrestrial Survey - BKF will provide the field work to prepare a Topographic Map for the subject property. The limits of the topographic survey will be the subject property and the improved width of roadways along the property frontage. The topographic survey will be comprised of identified visible site features such as roadways, pavements, evidence of significant traveled ways, walls, fences, trees 6- inches and larger in diameter and visual utility infrastructure. We will obtain a succession of spot elevations to define the general terrain of the site and immediately adjacent improvements to produce mapping at a 1-foot contour interval.
b. Utilities - Utility infrastructure within the mapping limits, including sewer, water valves, hydrants, meter boxes, storm drain and marked utilities, if encountered during the course of our field survey, will also be identified. The basic routing, inverts and orientation of the on-site gravity utilities will be identified based on field evidence and any available plans provided if to BKF prior to commencement of the survey. If as-built drawings are not provided or are inconclusive when compared to the field evidence, only data at the dipped structures will be provided. c. Utility Locating - BKF’s in-house utility locators will perform utility investigation services using standard industry acceptable methods as per California Government Code section 4216 to determine the approximate horizontal position and depth of detectable subsurface utilities within the designated area (see attached Limits of Work). BKF’s field crews will use a combination of water-based paint and pin flags to mark the results of our investigation on the ground surface. BKF crews may opt to use the Ground Penetrating Radar (GPR), if the soil conditions will return a good signal to attempt to locate water lines and other utility lines with no tracer wires. Individual field conditions will dictate the thoroughness of our subsurface utility investigation. BKF will perform a reasonable effort to determine the location of the existing underground utility lines; however, due to technical limitations of today’s most modern equipment, no guarantee (expressed or implied) can be made. Irrigation lines, empty conduits, and abandoned utilities will not be located. Potholing and excavation are specifically excluded on this proposal. This scope of work does not include clearing areas for geotechnical boring, soil sampling, and drilling operations.
d. Mapping - BKF will produce the mapping in a reproducible hard copy and electronic format. The signed hardcopy Topographic Map will be an instrument of service. Electronic mapping will be completed in an AutoCAD format and can be transferred and used by other team consultants for their work, as a courtesy.
1) The mapping is anticipated to be compiled at 1" = 20', and will also indicate individual spot elevations at various locations throughout the site. BKF will take a series of photographs for future reference and documentation of current field conditions encountered during the time of our survey.
2) The vertical control for the survey will be tied to the North American Vertical Datum of 1988 (NAVD88), unless otherwise agreed upon in writing prior to commencement of the survey. 3) T h e h o r i z o n t a l l o c a t i o n a n d r o t a t i o n o f t h e m a p p i n g i s a n t i c i p a t e d t o b e o n a n " a s s u m e d " coordinate system otherwise agreed upon in writing prior to commencement of the survey.
Note: Record of Survey
State law requires that the Surveyor of record performing the boundary resolution file a record of survey with the County if a map is not prepared as part of the project. As this project may anticipate pursuing a Tentative Parcel and Final Parcel Map for Condominium Purposes, we have currently excluded fee for this task in our scope of services. If a determination is made to eliminate pursuing filing of a map as part of the final permitting process BKF will be required to prepare and file a record of survey with the County at the expense of the owner. Recordation fees are not included in our proposal.
Docusign Envelope ID: 8FC79C5B-22E9-486D-B4BE-E4D2DCA9E299 310590
SCOPE QUALIFICATIONS AND ASSUMPTIONS
BKF Engineers' services are limited to those expressly set forth in the scope. We understand that BKF will have no other obligations or responsibilities for the project except as provided in this proposal letter, or as otherwise agreed to in writing. BKF will provide the scope of services consistent with, and limited to, the standard of care applicable to such services. For the scope of work identified, we have assumed the following:
1) Basis of Design and Site Information
a) Topographic Survey: Proposal assumes field survey will be completed for 37 and 45 Soledad Street sites concurrently. Separate mobilizations to survey each site independently will be an additional service. b) Title Report: A current title report for the property will be provided by the owner. c) Potholing: Potholing services are not included in this proposal unless specifically identified.
COMPENSATION
1. BASE SCOPE OF WORK:
BKF proposes to provide the services on a lump sum basis. We will invoice for our services on a percent complete basis per task summarized as follows:
Task Description Fee
1 Site Meeting $500
2 Topographic and Boundary Survey (37 Soledad) $7,500
Total Labor Fee $8,000
In addition, please budget $250 for reimbursable expenses. Reimbursable expenses are anticipated for reproduction, mileage, express and messenger deliveries, and computer deliverable plots. Reimbursable expenses will be billed on a cost plus 10-percent markup basis.
For tasks requested by the owner or Architect not defined in this scope of services, BKF will identify them as potential extra work. We can provide a scope and fee for these items or they may be tracked separately as extra work and billed on a time and materials per our attached rate schedule.
Thank you for the opportunity to present this proposal. We look forward to assisting in developing this project.
Please contact me at 650-482-6306 if you have any questions regarding our scope of services.
Respectfully,
BKF Engineers
Jonathan Tang, PE
Associate Principal
Docusign Envelope ID: 8FC79C5B-22E9-486D-B4BE-E4D2DCA9E299 311591
BKF ENGINEERS PROFESSIONAL SERVICES RATE SCHEDULE
EFFECTIVE JANUARY 1, 2024
CLASSIFICATION HOURLY RATE
PROJECTMANAGEMENT
Principal $302.00
Senior Associate Principal $280.00
Associate Principal $273.00
Senior Project Manager | Senior TechnicalManager $265.00 Project Manager | Technical Manager $260.00
Engineering Manager | Surveying Manager | Planning Manager $239.00
TECHNICAL STAFF
Senior Project Engineer | Senior Project Surveyor | Senior Project Planner $222.00 Project Engineer | Project Surveyor | Project Planner $195.00 Design Engineer | Staff Surveyor | Staff Planner $170.00 BIM SpecialistI, II, III $170.00 - $195.00 - $222.00
Technician I, II, III, IV $162.00 - $172.00 - $189.00 - $203.00 Drafter I, II, III, IV $127.00 - $139.00 - $150.00 - $167.00 Engineering Assistant | Surveying Assistant | Planning Assistant $106.00
FIELD SURVEYING
Survey Party Chief $222.00
Instrument Person $190.00
Survey Chainperson $143.00
Utility Locator I, II, III, IV $116.00 - $164.00 - $197.00 - $224.00 Apprentice I, II, III, IV $88.00 - $118.00 - $130.00 - $138.00
CONSTRUCTION ADMINISTRATION
Senior Consultant $290.00
Senior Construction Administrator $253.00
Resident Engineer $188.00
Field Engineer I, II, III $170.00 - $195.00 - $222.00
FUNDING & GRANT MANAGEMENT
Director of Funding Strategies $208.00
Funding StrategiesManager $190.00
Funding/Research Analyst I, II, III, IV $130.00 - $150.00 - $160.00 - $176.00
PROJECT ADMINISTRATION
Project Coordinator $142.00
Senior Project Assistant $122.00
Project Assistant $108.00
Clerical | Administrative Assistant $90.00
Expert witness rates are available upon request. Subject to the terms of a services agreement:
Charges for outside services, equipment, materials, and facilities not furnished directly by BKF Engineers will be billed as reimbursable expenses at cost plus 10%. Such charges may include, but shall not be limited to: printing and reproduction services; shipping, delivery, and courier charges; subconsultant fees and expenses; agency fees; insurance; transportation on public carriers; meals and lodging; and consumable materials. Allowable mileage will be charged at the prevailing IRS rate per mile. Monthly invoices are due within 30 days from invoice date. Interest will be charged at 1.5% per month on past due accounts.
The rates shown are subject to periodic increases, including January 1st of each year.
Docusign Envelope ID: 8FC79C5B-22E9-486D-B4BE-E4D2DCA9E299 312592
Project Management | Construction Cost Management
Our ref.: DB
October 28th, 2024
Maryam Rostami
TEF Design
1420 Sutter Street, 2nd Floor
San Francisco, CA 94109
Re: Fee Proposal – Cost Estimating Services
37 Soledad Street Café Building
2063 Grant Rd.
Los Altos, CA, 94024
Tel: 415.981.9430
Dear Maryam,
Further to your email, we are pleased to offer Cost Estimating services for the above project.
Scope of Services
We understand the scope of our services is to prepare an opinion of probable cost for the City of Salinas Soledad Street Café Building; we understand this project involves structural upgrades to the historic, two-story, reinforced concrete building The opinion of probable cost will be at the Schematic and Construction Documents of design.
The estimate will be based on the measurements of quantities from the drawings with composite unit rates reflecting the scope of work and the current market conditions. We will not obtain any bids or opinions of cost from subcontractors unless the work is of such a unique nature that no other cost information is available. No bids or third-party opinions will be obtained without prior approval from the client.
We have included time required to review and discuss our cost estimate with the Design Team and for incorporating any requested revision to the estimate as a result of the Design Team review. We have excluded any time required to reconcile our estimate with another cost estimate prepared by others. We have also excluded time required to attend any meetings or any Value Engineering cost services from this proposal. Should additional work be required, our standard hourly rate of $235 per hour will apply.
EXHIBIT F
Docusign Envelope ID: 8FC79C5B-22E9-486D-B4BE-E4D2DCA9E299 313593
Project Management | Construction Cost Management
Fees
We propose to provide the above services based on the following budget NTE Fees –
90% SD Cost Estimate (80 hrs @ $235/hr.) $ 18,800
100% CD Cost Estimate (96 hrs @235/hr.) $ 22,560
Total Not to Exceed Fees $41,360
We assume no alternates or options.
Expenses such as drawing reproduction, courier services,
special mailing services
(Federal Express, Express Mail etc.), and other abnormal costs are excluded and will be charged at cost plus 0% administration.
Our fees exclude travel costs outside the San Francisco Bay Area, any such travel costs as incurred will be billed separately.
Payment and Terms
We will issue a monthly invoice. Payment will be due thirty (30) calendar days.
Our proposal remains open for a period of ninety (90) days. After this time, we will be pleased to review the proposal, make any required amendments, and re -submit for your review and approval.
Work will be completed under the direction of Deo Bhalotia.
We trust that we have interpreted your requirements correctly, if you have any questions or suggested amendments, please do not hesitate to contact the undersigned. If you would like to proceed with the above services, please complete and return the authorization below.
We look forward to working with you on this project.
On behalf of TBD Consultants On behalf of TEF Design
Accepted by:
Deo Bhalotia
Associate Principal Date:
Title:
Docusign Envelope ID: 8FC79C5B-22E9-486D-B4BE-E4D2DCA9E299 314594
Project Management | Construction Cost Management
Docusign Envelope ID: 8FC79C5B-22E9-486D-B4BE-E4D2DCA9E299 315595
ESTIMATESpaur Group
988 Easton Ave
San Bruno, CA 94066
[email protected]
+1 (510) 559-0856
www.spaurgroup.com
Bill to
TEF Design
1420 Sutter St, 2nd Floor
San Francisco, CA 94109
Estimate details
Estimate no.: 1008
Estimate date: 10/29/2024
#Date Product or service Description Qty Rate Amount
1. Aerial Photography Aerial photography and imagery processing:
nadir, oblique, and/or 360 imaging.
2.25 $200.00 $450.00
2. Travel 192 $0.65 $124.80
Note to customer
Aerial photography of buildings at 37 Salinas st Salinas, CA. Imagery to show current conditions of building roof and will consist of 10-15 photos from mostly top down perspective, and including 360 panoramic images from corners of building. Images will include metadata of GPS location and orientation of images.
Price includes introductory discount.
Thank you for your business!
Subtotal $574.80
Discount 15% -$86.22
Total $488.58
Accepted date Accepted by
EXHIBIT G
Docusign Envelope ID: 8FC79C5B-22E9-486D-B4BE-E4D2DCA9E299 316596
Version: July 2024
AGREEMENT —AMENDMENT NO. [3] TO
AGREEMENT FOR PROFESSIONAL SERVICES
BETWEEN
TEF ARCHITECTURE AND INTERIOR DESIGN, INC. AND CITY OF SALINAS
This Amendment No. [3] to the Professional Service s Agreement (the “Amendment”) is entered into this 28th day of October 2025, by and between the City of Salinas (the “City”) and TEF Architecture and Interior Design, Inc., (the “Consultant”). City and Contractor may be individually referred to herein as a “Party” and collectively the City and Contractor may be referred to as the “Parties.”
RECITALS
WHEREAS, the City and Contractor first entered int o a/an Professional Services Agreement effective July 1, 2024, pursuant to which Contractor agreed to act as and provide certain services to the City for compensation (the “Agreement”); and
WHEREAS, on November 19, 2024, the Council approved Amendment No. 1 to the TEF Architecture and Interior Design, Inc. agreement to refine the design concepts further and select a preferred concept for 34-38 Soledad Street, to include additional design and pre-development work for the City-owned property at 45 Soledad Street, extend the term of the contract to December 31, 2025, and increase the not to exceed amount to $252,290.00; and
WHEREAS, On July 1, 2025, the Council approved Amendment No. 2 to develop the design concepts for 34-38 37-39, and 45 Soledad Street into schematic designs for entitlement prior to the preparation of a Request for Proposals for development of the sites, extend the term of the contract to December 31, 2026, and increase the not to exceed amount to $736,560.00; and
WHEREAS, the City and Contractor desire to further amend the Agreement to reflect the additional scope provided by consultant and reflect the revised compensation to be paid to consultant.
NOW, THEREFORE, in mutual consideration of the terms and conditions set forth below, the Parties agree as follows:
TERMS
1. The Agreement, Scope of Services section, is amended to add the additional services outlined in the Consultant proposal, attached and incorporated by reference.
2. The Agreement, Compensation section, is amended to increase the not to exceed amount to $840,889.00.
3. All other covenants, terms, and conditions set forth in the Agreement and not amended by this Amendment shall remain in full force and effect as if fully set forth herein.
IN WITNESS WHEREOF, the undersigned, as authorized representatives of the City and Contractor have entered into this Agreement as of the date first written above.
CITY OF SALINAS
___________________________________
René Mendez, City Manager
Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 317533
Version: July 2024
APPROVED AS TO FORM:
___________________________________
□ Christopher A. Callihan, City Attorney
□ Rhonda Combs, Assistant City Attorney
TEF ARCHITECTURE AND INTERIOR DESIGN, INC.
____________________________________
Printed name: Maryam Rostami__________
Title: Principal________________________
Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 318534
Additional Services Request #3: 37-39 Soledad Street, Additional Research & As-Built Services From: Maryam Rostami TEF Architecture & Interior Design, Inc 1420 Sutter Street, 2nd Floor San Francisco, CA 94109 ASR No.: Project No.:
03 22377.03
Project: Date:
37-39 Soledad Street HSR & Emergency Stabilization September 02, 2025 Revised September 04, 2025 Client: Grant Leonard City of Salinas
DESCRIPTION of ADDITIONAL SCOPE of SERVICES & FEES TEF Design is requesting additional fees pursuant to extended scope items not anticipated by our proposal, including
the
items
listed
below,
completed
by
both
TEF
and
Groundwork
Preservation. Scope of Work The scope of services included in this proposal includes: 1. Additional Research to evaluate 39 Soledad Street for Historical Significance (by Groundwork Preservation) a. Targeted Archival Research b. Development of Additional site history and context c. Update CPHR/HRHP evaluation 2. As-Built Documentation of 39 Soledad Street (by TEF Design) a. Additional site visit to building to document existing conditions measurements b. Update of existing Revit model of the building. A detailed breakdown of each discipline’s services scope are included in attached fee documents. PROPOSED FEE: Fees will be invoiced monthly based on the percentage of work completed in that month. Groundwork Preservation $6,000.00 TEF $1,960.00 TOTAL $ 7,960.00 Estimated Reimbursables: $293 Upon your agreement, please sign this Additional Services Proposal and/or please provide a Contract Modification.
We
will
commence
design
services
based
on
completion
of
a
contract
modification.
1420 Sutter Street, Floor 2, San Francisco, CA 94109 | TEFarch.com Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 319535
Agreed by: Client: Architect: _____________________________ Agreed by Maryam Rostami, AIA, NOMA, LEED AP, LFA Principal TEF Architecture & Interior Design, Inc. 4 Sep 2025 Date Date 1420 Sutter Street, Floor 2, San Francisco, CA 94109 | TEFarch.com Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 City Manager
10/30/2025 | 2:03 PM PDT
320536
TEF Design 09/02/25 Revised 09/04/2537 Soledad Street HSR and Structural UpgradesAdditional Services Request 3City of SalinasTASK & HOURS SUMMARY: Design Team Summary SCOPE of SERVICES
HSR HOURS & FEES
PrincipalRateProjectRateProject Rate Arch Rate ClericalRate Total TASKS $350Manager$250Arch.$170 Staff $140 Staff $110 Fee
1.0 Update Revit Model 0 $0 2 $5002 $3408 $1,1200 $0 $1,960 Sub-Total 0 $0 2 $5002 $3408 $1,1200 $0 $1,960
Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 321537
Project Name:
Date:
Prepared By:
Prepared For:
Notes
Task 4 includes targeted
archival research,
development of additional
site history and context,
and updated CRHR/NRHP
evaluation to include 39
Soledad and Criterion C/3
significance.
Rate Unit Qty Cost Qty Cost
$190.00 Hour 24 $4,560.00 24 4,560.00$
Associate Cultural Resources Historian $90.00 Hour 16 $1,440.00 16 1,440.00$ Total 6,000.00$
Expense Description Rate Unit Qty Cost Qty Cost
Mileage (1 site visit, round
trip to site from Colfax, CA =
500 miles)
Federal Rate $0.670 Mile 0 $0.00
Per Diem (meals)
Daily Rate
(Monterey
County)
$74.00 Day 0 $0.00
Research Fees $50.00 Flat rate 0 $0.00
10% Markup $0.00 0 $0.00
Total $0.00
Total Direct
Labor
Total
Expenses
Total Project
Cost
$0.00
$6,000.00 $6,000.00
$0.00
$6,000.00
Task 4: Research and
Significance
Evaluation for 39
Soledad
$6,000.00
Expenses
Totals
August 27, 2025
Totals
Labor
Lindsey Moder, TEF Architects
Task 4: Research and
Significance
Evaluation for 39
Soledad
3 Site visits are inclusive of travel time.
1 Electronic deliverables only, no printing.
2 No rounds of review and comment from client.
Gretchen Hilyard Boyce, Groundwork
Preservation, LLC
Historic Structure Report, 37-39 Soledad
Street, Salinas, CA - Addendum 1
Title
Principal
Assumptions
Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 322538
Additional Services Request #4: 37-39 Soledad Street, Concept Design for 39 Soledad Street From: Maryam Rostami TEF Architecture & Interior Design, Inc 1420 Sutter Street, 2nd Floor San Francisco, CA 94109 ASR No.: Project No.:
04 22377.05
Project: Date:
37-39 Soledad Street Concept Design and Entitlements Package September 19, 2025 Client: Grant Leonard City of Salinas
DESCRIPTION of ADDITIONAL SCOPE of SERVICES & FEES TEF Design is requesting additional fees pursuant to extended scope items not anticipated by our proposal, including
the
items
listed
below,
completed
by
both
TEF
and
Groundwork
Preservation. Scope of Work The scope of services included in this proposal includes: Task 1: Additional work to develop a conceptual design and stakeholder engagement for 39 Soledad Street a. Deliverables: Concept Design Presentation w/ 2 Renderings, Slidedecks and Notes from stakeholder
engagement
meetings
b. Meetings: Three (3) stakeholder engagement meetings, 1 Concept Design Review Meeting c. Duration: 8 weeks (3 weeks Concept Design + 5 weeks Stakeholder Engagement) Task 2: Additional work to proceed through Schematic Design (SD) for 39 Soledad Street - Deliverables: 90SD Drawings (2 sets) - Meetings: 1 client review meeting, 1 pre-app meeting with Planning - Duration: 6 weeks Task 3: Additional work to prepare Entitlements Packages for 39 Soledad and respond to comments, revise drawings
- Deliverables: Entitlements Package (2 packages) - Duration: 6 weeks PROPOSED FEE: Fees will be invoiced monthly based on the percentage of work completed in that month. TEF $34,073.00 Estimated Reimbursables: $613 Upon your agreement, please sign this Additional Services Proposal and/or please provide a Contract Modification.
We
will
commence
design
services
based
on
completion
of
a
contract
modification.
1420 Sutter Street, Floor 2, San Francisco, CA 94109 | TEFarch.com Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 323539
Agreed by: Client: Architect: _____________________________ Agreed by Maryam Rostami, AIA, NOMA, LEED AP, LFA Principal TEF Architecture & Interior Design, Inc. 19 Sep 2025 Date Date 1420 Sutter Street, Floor 2, San Francisco, CA 94109 | TEFarch.com Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 City Manager
10/30/2025 | 2:03 PM PDT
324540
Additional Services Request #5: 37-39 Soledad Street Structural Stabilization, Structural effort for Construction
Documents
and
Construction
Administration
From: Maryam Rostami TEF Architecture & Interior Design, Inc 1420 Sutter Street, 2nd Floor San Francisco, CA 94109 ASR No.: Project No.:
05 22377.03
Project: Date:
37-39 Soledad Street HSR and Emergency Stabilization September 19, 2025 Client: Grant Leonard City of Salinas
DESCRIPTION of ADDITIONAL SCOPE of SERVICES & FEES TEF Design and their consultant, Tipping Engineers, is requesting additional fees pursuant to additional work required
to
complete
this
project,
including
the
items
listed
below,
completed
by
both
TEF
and
Tipping
Engineers.
Scope of Work The scope of services included in this proposal includes: 90% Construction Document for Building Permit and Pricing 1. Advance design documentation to 90% Construction Documents and Technical Specifications for
Building
Permit
Submittal
for
City's
approval
and
as
bid
documents.
a. Construction Drawings, Specifications, and structural calculations shall be sufficient for construction
of
the
project.
b. Client and team will choose one schematic structural upgrade scheme to progress to Construction
Documents.
2. Update project construction cost estimate and review with the City. Phase 4: Conformed Set (100% Construction Documents) 1. Meet with City permit review staff as needed to refine plans for resubmittal. Obtain final permit. 2. After receipt of City's approval of Working Drawings, Technical Specifications, and results/changes
based
on
external
cost
estimate
and
constructability
review,
assemble
100
%
Final
specifications
and
drawings.
Phase 5: Construction Administration and Project Closeout 1. Support the City and the Contractor in the construction of the project in accordance to the contract
documents,
schedule
and
budget;
and
in
the
turnover
of
a
complete
project.
PROPOSED FEE: Fees will be invoiced monthly based on the percentage of work completed in that month. Tipping Engineers $58,000.00 TEF $2,640.00 TOTAL $60,640.00 1420 Sutter Street, Floor 2, San Francisco, CA 94109 | TEFarch.com Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 325541
Estimated Reimbursables: $750 Upon your agreement, please sign this Additional Services Proposal and/or please provide a Contract Modification.
We
will
commence
design
services
based
on
completion
of
a
contract
modification.
Agreed by: Client: Architect: _____________________________ Agreed by Maryam Rostami, AIA, NOMA, LEED AP, LFA Principal TEF Architecture & Interior Design, Inc. 19 Sep 2025 Date Date 1420 Sutter Street, Floor 2, San Francisco, CA 94109 | TEFarch.com Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 10/30/2025 | 2:03 PM PDT
City Manager
326542
September 10, 2025
Maryam Rostami
TEF Design
1420 Sutter Street
San Francisco, CA 94109
Re: 37-39 Soledad Street Stabilization – ASR#1 - CD-CA
Salinas, CA
Job No. 2024.294.00
Dear Maryam,
We are pleased to provide this proposal for additional services for the 37-39 Soledad Street Stabilization project. This proposal covers tasks and deliverables that are outside the scope of structural engineering services included in our original work agreement, dated August 18, 2025.
This additional services request is necessary to incorporate the design drawings, approvals and construction administration services associated with the implementation of structural stabilization measures identified as part of base scope of work in the August 18, 2025 agreement.
After visiting the site, reviewing relevant documents, drawings, and reports, and discussing the project goals with you and the client, we have identified a scope of recommended structural stabilization measures. We understand that due to funding requirements, the client now intends to complete the construction of the stabilization scope by March of 2026. As such, the design of this work is now proceeding on a faster track than originally anticipated.
The structural scope of stabilization work will include the following:
• Addition of wall to floor out-of-plane anchors at the second floor of both 37 and 39 Soledad (these were previously added at the roof level of 37 Soledad) • Addition of new plywood roof sheathing at 39 Soledad and plywood floor sheathing at the second floor of both 37 and 39 Soledad (not that plywood roof sheathing was previously added to 37 Soledad).
• Addition of a new steel moment frame and footing to provide seismic strength in the building’s transverse direction at the front facade
• Repair of damaged, rotated and detached framing at the front facade • Repair of fire damaged wood framing at the roof and front elevation Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 327543
37-39 Soledad Street Stabilization – ASR#1 - CD-CA September 10, 2025 • Coordination to ensure the preservation and/ or temporary removal of historic elements at the entry facade that require rehabilitation.
As part of our work, we will provide a set of structural drawings for permit and construction. We will also provide substantiating calculations. We will respond to plan check comments and incorporate changes as required. We will provide typical construction administration services such as responding to contractor requests for information, making site observations, reviewing submittals, etc.
We propose to provide basic structural engineering services for the work described above for the fixed sums indicated below. Please note that this work is being done in accordance with the Additional Services Section of our original agreement referenced above, except the fee is fixed rather than hourly.
Our fee shall be broken down by phase as follows:
Phase T otal Fee
Construction Documents $37,000
Approvals and Bidding 3,000
Construction Services 18,000
T otal $58,000
If this proposal meets with your approval, please return a signed copy as our authorization to proceed.
We appreciate this opportunity to be of service to you. Please reach out directly if you have any questions or concerns about this additional services request.
Sincerely, Accepted:
______________________________________________
Signature
______________________________________________
Marc Steyer, SE, LEED AP Printed Name and Title
Principal
______________________________________________
Date
2 of 2
Docusign Envelope ID: 8D648451-9740-4FC8-ACAC-F244B0649467 328544
City of Salinas
Legislation Text
200 Lincoln Ave., Salinas,
CA 93901
www.cityofsalinas.org
File #: ID#26-021, Version: 1
Amendment No. 2 to Agreement for Services with California Premier Restoration for Emergency Clean- Up and Stabilization of 37 and 39 Soledad Street
Approve a Resolution authorizing the City Manager to execute Amendment No. 2 to Agreement for Services with California Premier Restoration for emergency clean-up and stabilization of 37 and 39 Soledad Street to increase the total compensation amount by $135,000 for a maximum compensation amount not to exceed $382,150.
City of Salinas Printed on 1/29/2026Page 1 of 1
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CITY OF SALINAS
COUNCIL STAFF REPORT
DATE: FEBRUARY 3, 2026
DEPARTMENT: COMMUNITY DEVELOPMENT
FROM: LISA BRINTON, DIRECTOR
THROUGH: GRANT LEONARD, PLANNING MANAGER
TITLE: AMENDMENT NO. 2 TO AGREEMENT FOR SERVICES WITH
CALIFORNIA PREMIER RESTORATION FOR EMERGENCY
CLEAN-UP AND STABILIZATION OF 37 AND 39 SOLEDAD
STREET
RECOMMENDED MOTION:
A motion to approve a Resolution authorizing the City Manager to execute Amendment No. 2 to Agreement for Services with California Premier Restoration for emergency clean -up and stabilization of 37 and 39 Soledad Street to increase the total compensation amount by $ 135,000 for a maximum compensation amount not to exceed $382,150.
EXECUTIVE SUMMARY:
The City currently has a n Agreement for Services with California Premier Restoration for emergency clean-up and stabilization of 37 and 39 Soledad Street . This Amendment expands the scope of services provided and increases the total compensation amount by $135,000 for a maximum compensation amount not to exceed $382,150. There is no change to the term of June 30,2026.
BACKGROUND:
In 2023 the City applied for and received $1,555,000 in Regional Early Action Planning Grant (REAP 2.0) funding from the Association of Monterey Bay Area Governments (AMBAG) to complete predevelopment activities for the development of mixed -use affordable housing to be located in the Chinatown neighborhood.
As part of the on -going efforts to implement the Chinatown Rev italization Plan (2019), the City purchased the Republic Café and Lotus Inn ( 37 and 39 Soledad Street ) in December 202 4. The buildings were damaged due to a fire in 2022 and are currently boarded up. In November of 2025, the City entered into an Agreement for Services with California Premier Restoration for emergency clean-up and stabilization of 37 and 39 Soledad Street for a not to exceed amount of $247,150.
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The scope of work for California Premier Restoration included an optional task to complete removal of interior finishe s and fixtures to bring the interior to bare stud condition following testing for lead and asbestos. The City completed lead and asbestos testing for the buildings in December 2025, and California Premier Restoration is now prepa red to move forward with the removal of the interior finishes, as outlined in the attached Change Order (Exhibit A).
In January 2026, the City administratively executed Amendment No. 1 to the Agreement for Services with California Premier Restoration to extend the term to June 30, 2026. Amendment No. 2 allows the City and California Premier Restoration to complete the additional clean-up work and get the building interiors prepared for future rehabilitation and restoration work.
CEQA CONSIDERATION:
Not a Project. The City of Salinas has determined that the proposed action is not a project as defined by the California Environmental Quality Act (CEQA) (CEQA Guidelines Section 15378).
In addition, CEQA Guidelines Section 15061 includes the general rule that CEQA applies only to activities which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. Because the proposed action and this matter have no potential to cause any effect on the environment, or because it falls within a category of activities excluded as projects pursuant to CEQA Guidelines section 1537 8, this matter is not a project. Because the matter does not cause a direct or foreseeable indirect physical change on or in the environment, this matter is not a project. Any subsequent discretionary projects resulting from this action will be assessed for CEQA applicability.
CALIFORNIA GOVERNMENT CODE §84308 APPLIES:
Yes.
STRATEGIC PLAN INITIATIVE:
Development of the City-owned properties in Chinatown advances the City Council’s 2025-2028 Housing and Economic Development initiatives by supporting the development of mixed-use affordable housing and the revitalization of the Chinatown neighborhood.
DEPARTMENTAL COORDINATION:
The Community Development Department is leading this effort with close coordination with Public Works and Finance Departments.
FISCAL AND SUSTAINABILITY IMPACT:
The Regional Early Action Planning Grant (REAP 2.0) from the Association of Monterey Bay Area Governments (AMBAG) funds this project . REAP 2.0 funding has a March 31, 2026 , expenditure deadline and to meet that deadline, $135,000 in REAP 2.0 funds previously allocated 331
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to a separate contract with TEF Design for architectural services for Chinatown are being reallocated to fund Amendment No. 2.
Fund
General Ledger Number
(Operating/CIP)
General Ledger Account
Name
Remaining Budget
Appropriation
Amount Requested
2953 30.3111-63.6010 Outside Professional
Services
$0 $135,000
ATTACHMENTS:
1. Resolution
2. Amendment No. 2
a. Exhibit “A” California Premier Restoration Change Order
3. Agreement for Services
4. Amendment 1
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RESOLUTION NO. _____ (N.C.S.)
A RESOLUTION APPROVING AMENDMENT NO. 2 TO THE AGREEMENT FOR
SERVICES BETWEEN THE CITY OF SALINAS AND CALIFORNIA PREMIER
RESTORATION
WHEREAS, the City applied for and received $1,555,000 in Regional Early Action Planning Grant (REAP 2.0) funding from the Association of Monterey Bay Area Governments (AMBAG) to complete predevelopment activities for the development of mixed -use affordable housing to be located in the Chinatown neighborhood; and
WHEREAS, as part of the on -going efforts to implement the Chinatown Revitalization Plan, the City purchased 37 and 39 Soledad Street in December 2024; and
WHEREAS, 37 and 39 Soledad Street are currently boarded up and were damaged due to a fire in 2022; and
WHEREAS, in November of 2025, the City entered into an Agreement for Services with California Premier Restoration for emergency clean-up and stabilization of 37 and 39 Soledad Street with a not to exceed amount of $247,150; and
WHEREAS, the scope of work for California Premier Restoration included an optional task to complete removal of interior finishes and fixtures to bring the interior to bare stud condition following testing for lead and asbestos; and
WHEREAS, the City administratively amended the Agreement for Services with California Premier Restoration in January 2026, to extend the term to June 30, 2026; and
WHEREAS, the City completed lead and asbestos testing for the buildings in December 2025, and California Premier Restoration is now prepared to move forward with the removal of the interior finishes, as outlines in the attached Change Order (Exhibit A); and
WHEREAS, the Regional Early Action Planning Grant (REAP 2.0) from the Association of Monterey Bay Area Governments (AMBAG) funds this project; and
WHEREAS, to meet the March 31, 2026 , expenditure deadline, $135,000 in REAP 2.0 funds previously allocated to a separate contract with TEF Design for architectural services for Chinatown are being reallocated to fund Amendment No. 2; and
WHEREAS, the City of Salinas has determined that the proposed action is not a project as defined by the California Environmental Quality Act (CEQA) (CEQA Guidelines Section 15378). Any subsequent discretionary projects resulting from this action will be assessed f or CEQA applicability.
NOW, THEREFORE, BE IT RESOLVED that the Salinas City Council authorizes the City Manager to execute Amendment No. 2 to the Agreement for Services between the City of 333
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Salinas and California Premier Restoration to expand the scope of services provided in Exhibit A, increase the total compensation amount by 135,000 for a maximum not to exceed compensation amount of $382,150.00. REAP 2.0 Grant funds are the funding source.
PASSED AND APPROVED this 3rd day of February 2026, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
_______________________
Dennis Donohue, Mayor
ATTEST:
_________________________
Patricia M. Soratos, City Clerk
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Docusign Envelope ID: FF828B62-9320-46F4-B59F-9D61940B3A 1 A AGREEMENT -AMENDMENT NO. [2] TO
37 AND 39 SOLEDAD STREET EMERGENCY CLEAN-UP AND STABILIZATION
BETWEEN CITY OF SALINAS AND CALIFORNIA PREMIER RESTORATION This Amendment No. 2 to the Agreement for Services for 37 And 39 Soledad Street Emergency Clean-Up And Stabilization (the "Amendment") is entered into this 3rd day of Fedruary 2026, by and between the City of Salinas (the "City") and California Premier Restoration, a California Corporation, (the "Contractor"). City and Contractor may be individually referred to herein as a "Party" and collectively the City and Contractor may be referred to as the "Parties."
RECITALS
WHEREAS, the City and Contractor first entered into an Agreement for Services for 37 And 39 Soledad Street Emergency Clean-Up And Stabilization effective November 14th, 2025, pursuant to which Contractor agreed to act as and provide certain services to the City for compensation (the "Agreement"); and WHEREAS, the City amended the Agreement for Services with California Premier Restoration in January, 2026, to extend the term to June 30, 2026; and
WHEREAS, the City and Contractor desire to further amend the Agreement to reflect the additional scope of services provided by contractor and reflect the revised compensation to be paid to contractor.
NOW, TH ERE FORE, in mutual consideration of the terms and conditions set forth below, the Parties agree as follows:
TERMS
1. The Agreement, Scope section, is amended to add the following:
Additional services as described in the Contractor's Change Order 1 (Exhibit A).
2. The Agreement, Payment section, is amended to increase the following:
City agrees to pay and the Contractor agrees to accept as full and fair consideration for the performance of this agreement, Three Hundred Eighty Two Thousand One Hundred and Fifty Dollars ($382,150).
3. All other covenants, terms, and conditions set forth in the Agreement and not amended by this Amendment shall remain in full force and effect as if fully set forth herein.
IN WITNESS WHEREOF, the undersigned, as authorized representatives of the City and Contractor have entered into this Agreement as of the date first written above.
CITY OF SALINAS
Rene Mendez, City Manager
APPROVED AS TO FORM:
Form: Agreement Amendment
Version: July 2025
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C:\Documents and Settings\Anne\Desktop\Change Order Form.doc:11926
EXTRA WORK CHANGE ORDER
License # 1013305
Date of Change Order: January 19, 2026 Document #1 of 1 – Change Order #1
Date of Original Agreement: November 14, 2025
Owner: City of Salinas
Address: 39 Soledad Street
Salinas, CA 93901
This form needs to be signed by the Contractor before the Contractor is obligated to perform any work other than that described in the original contract.
1. Description and Scope of Work Encompassed by this Change Order:
Drywall removal and disposal and other deconstruction of wall finishes and fixtures to bring interior as close as possible to “stud bare” condition.
Remove and dispose (Interior of 39 Soledad Street):
o Drywall
o Sheer wall
o Plumbing fixtures (urinals, sinks, toilets, etc.)
o Any wall structure inhibiting access to finished walls.
2. Amount to Be Added/Subtracted from Original Contract Price:
$135,000.00 to be added.
3. Effect the Change Order Will Make in the Progress Payment Schedule Set Forth in the Original Contract: Payment schedule will be amended as follows:
Application and certificate for payment will be processed and submitted as required.
4. Effect the Change Order Will Have on the Completion Date: Allow three weeks for completion.
This change order shall be incorporated as part of the original contract and shall become part of the contract when signed by both parties.
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C:\Documents and Settings\Anne\Desktop\Change Order Form.doc:11926 Owner
______________________
California Premier Restoration
By: _________________________
Date: ________________________ Date: ________________________
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Form: Agreement Amendment
Version: July 2025
AGREEMENT —AMENDMENT NO. [1] TO
37 AND 39 SOLEDAD STREET EMERGENCY CLEAN-UP AND STABILIZATION
BETWEEN CITY OF SALINAS AND CALIFORNIA PREMIER RESTORATION
This Amendment No. 1 to the Agreement for Services for 37 And 39 Soledad Street Emergency Clean-Up And Stabilization (the “Amendment”) is entered into this 30th day of January 2026, by and between the City of Salinas (the “City”) and California Premier Restoration, a California Corporation, (the “Contractor”). City and Contractor may be individually referred to herein as a “Party” and collectively the City and Contractor may be referred to as the “Parties.”
RECITALS
WHEREAS, the City and Contractor first entered into a/an Agreement for Services for 37 And 39 Soledad Street Emergency Clean-Up And Stabilization effective November 14th, 2025, pursuant to which Contractor agreed to act as and provide certain services to the City for compensation (the “Agreement”); and
WHEREAS, the City and Contractor desire to amend the Agreement to reflect the additional scope of services provided by contractor, to reflect the revised compensation to be paid to contractor, and to extend the term of the agreement.
NOW, THEREFORE, in mutual consideration of the terms and conditions set forth below, the Parties agree as follows:
TERMS
1. The Agreement, Term section, is amended to extend the following:
Work under this agreement shall be completed by 06/30/2026 unless City grants a written extension of time as set forth in Section 2.
2. All other covenants, terms, and conditions set forth in the Agreement and not amended by this Amendment shall remain in full force and effect as if fully set forth herein.
IN WITNESS WHEREOF, the undersigned, as authorized representatives of the City and Contractor have entered into this Agreement as of the date first written above.
CITY OF SALINAS
___________________________________
René Mendez, City Manager
APPROVED AS TO FORM:
___________________________________
□ Christopher A. Callihan, City Attorney
□ Rhonda Combs, Assistant City Attorney
California Premier Restoration, a California Corporation
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365505
Form: Agreement Amendment
Version: July 2025
____________________________________
Printed name: Michael Mosebach_________
Title: President________________________
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City of Salinas
Legislation Text
200 Lincoln Ave., Salinas,
CA 93901
www.cityofsalinas.org
File #: ID#26-024, Version: 1
Monterey-Salinas Transit (MST) Grant Local Match Increase Approve a Resolution approving an increase of $8,000 to Monterey-Salinas Transit for the Sustainable Communities Planning Grant local match commitment for a total of $28,000.
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CITY OF SALINAS
COUNCIL STAFF REPORT
DATE: FEBRUARY 3, 2026
DEPARTMENT: PUBLIC WORKS
FROM: ADRIANA ROBLES, PE, CFM, CITY ENGINEER
TITLE: MST GRANT LOCAL MATCH INCREASE
RECOMMENDED MOTION:
A motion to approve an increase of $8,000 to Monterey -Salinas Transit for the Sustainable Communities Planning Grant local match commitment for a total of $28,000.
EXECUTIVE SUMMARY:
In February 2021, the City Council approved a resolution supporting a local match commitment of $20,000 for Monterey-Salinas Transit’s (MST) application for a Caltrans planning grant to fund the East Alisal Bus Rapid Transit and Salinas Transit Center Reloca tion Feasibility Study. MST informed the City that additional funds were needed and is requesting an additional $8,000 of local match commitment from the City.
BACKGROUND:
On February 2, 2021, the City Council approved Resolution No. 22046 supporting a local match commitment of $20,000 for MST’s application to Caltrans’ Sustainable Communities Planning Grant program. The planning grant was to fund the East Alisal Bus Rapid Transit (BRT) and Salinas Transit Center Relocation Feasibility Study (“Study”). The Study will assess the feasibility of establishing a bus rapid transit corridor along East Alisal and potential locations for relocating the Salinas Transit Center.
MST received a total of $463,100 from Caltrans for this effort . Matching funds of $20,000 were to be provided by MST, City of Salinas and Taylor Farms. MST requested additional community engagement which exceeded the anticipated budget. As a result, continuing the partnership and sharing ratio, an additional $8,000 was requested from the City of Salinas , Taylor Farms, along with MST also providing the higher amount to account for the expanded scope of services from the consultant.
CEQA CONSIDERATION:
Not a Project . The City of Salinas has determined that the proposed action is not a project as defined by the California Environmental Quality Act (CEQA) (CEQA Guidelines Section 15378). 394
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In addition, CEQA Guidelines Section 15061 includes the general rule that CEQA applies only to activities which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. Because the proposed action and this matter have no potential to cause any effect on the environment, or because it falls within a category of activities excluded as projects pursuant to CEQA Guidelines section 15378, this matter is not a project. Because the matter does not cause a direct or foreseeable indirect physical change on or in the environment, this matter is not a project. Any subsequent discretionary projects resulting from this action will be assessed for CEQA applicability.
CALIFORNIA GOVERNMENT CODE §84308 APPLIES:
No.
STRATEGIC PLAN INITIATIVE:
Providing the additional funding for the grant local match, allows for MST to complete their planning study. The Study may identify strategies to enhance transit in the Alisal, therefore impacting Economic Development, Infrastructure, Public Safety, and Youth and Seniors.
DEPARTMENTAL COORDINATION:
The City Engineer and Advanced Planning Manager participate in the Technical Advisory Committee for this project. Review of the Study will be coordinated by MST with the Public Works and Community Development Departments.
FISCAL AND SUSTAINABILITY IMPACT:
Fund
General Ledger Number
(Operating/CIP)
General Ledger Account
Name
Remaining Budget
Appropriation
Amount Requested
1200 30.9136-63.5900 Outside services-Other
professional services
$166,973 $8,000
ATTACHMENTS:
Resolution
MST Request Letter, August 1, 2025
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RESOLUTION NO. ________ (N.C.S.)
MST GRANT LOCAL MATCH INCREASE
WHEREAS, Monterey-Salinas Transit (MST) has requested an increase to the City’s local match provided for the Caltrans Sustainable Communities Planning Grant; and
WHEREAS, on February 2, 2021, the City Council approved Resolution No. 22046 supporting a local match of $20,000 for MST’s application to the Caltrans’ Sustainable Communities Planning Grant program.; and
WHEREAS, the planning grant was to fund the East Alisal Bus Rapid Transit and Salinas Transit Center Relocation Feasibility Study (“Study”); and
WHEREAS, MST received a total of $463,100 from Caltrans for the Study. Matching funds of $20,000 were provided by MST, City of Salinas and Taylor Farms as local match.; and
WHEREAS, the proposed action is not a project as defined by the California Environmental Quality Act (CEQA), CEQA Guidelines section 15378.
NOW, THEREFORE, BE IT RESOLVED that the Salinas City Council approves an increase of $8,000 to the Monterey -Salinas Transit for the Sustainable Communities Planning Grant local match commitment for a total of $28,000.
PASSED AND APPROVED this 3rd day of February, 2026, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
_______________________
Dennis Donohue, Mayor
ATTEST:
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_________________________
Patricia M. Soratos, City Clerk
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City of Salinas
Legislation Text
200 Lincoln Ave., Salinas,
CA 93901
www.cityofsalinas.org
File #: ID#26-023, Version: 1
Acceptance of Regional Surface Transportation Program Grant and appropriation of additional funds for the Boronda Road Congestion Relief Project, Phase 1, CIP 9510 Approve a Resolution accepting $1,721,723.75 of fair share and $1,000,000 of mid-cycle competitive grant funds from the Regional Surface Transportation Program (RSTP); and increasing the expenditure appropriation by $2,721,723.75 of total RSTP funds for the Boronda Road Congestion Relief Project, Phase 1 contingencies, CIP No. 9510 for a total construction contingency of $4,598,263.75.
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CITY OF SALINAS
COUNCIL STAFF REPORT
DATE: FEBRUARY 3, 2026
DEPARTMENT: PUBLIC WORKS
FROM: DAVID JACOBS, PE, LS, DIRECTOR
BY: JOSIE LANTACA, ASSISTANT ENGINEER
TITLE: ACCEPTANCE OF REGIONAL SURFACE TRANSPORTATION
PROGRAM GRANT AND APPROPRIATION OF ADDITIONAL
FUNDS FOR THE BORONDA ROAD CONGESTION RELIEF
PROJECT, PHASE 1, CIP 9510
RECOMMENDED MOTION:
A motion to approve a Resolution:
1. Accepting $1,721,723.75 of fair share and $1,000,000 of mid-cycle competitive grant funds from the Regional Surface Transportation Program (RSTP); and
2. Increasing the expenditure appropriation by $2,721,723.75 of total RSTP funds for the Boronda Road Congestion Relief Project , Phase 1 contingencies, CIP No. 9510 for a total construction contingency of $4,598,263.75.
EXECUTIVE SUMMARY:
The Boronda Road Congestion Relief Project (Project) proposes to widen East Boronda Road into a four -lane roadway (two -lanes at each direction) between Dartmouth Way and Independence Boulevard, and to construct roundabouts at McKinnon Street, El Dorado Drive, Natividad Road, and Independence Boulevard. The Project will be constructed in phases to accommodate funding availability.
Phase 1 of the Project will construct the McKinnon roundabout with the associated improvements and was awarded to Granite Construction Company on August 6, 2024 (Resolution No. 23053).
Construction started on November 12, 2024, and is currently scheduled to be completed in fall 2026.
On August 27, 2025, the Transportation Agency for Monterey County (TAMC) approved the allocation of $1,721,723.75 of fair share funds and $1,000,000 of competitive grant funds from the Regional Surface Transportation Program (RSTP) for the Project. Staff is requesting approval to appropriate the total of these funds, $2,721,723.75 to the Phase 1 Project construction contingencies.
BACKGROUND:
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The Boronda Road Congestion Relief Project (Project) proposes to widen East Boronda Road into a four -lane roadway (two -lanes at each direction) between Dartmouth Way and Independence Boulevard, and to construct roundabouts at McKinnon Street, El Dorado Drive, Natividad Road, and Independence Boulevard. In May 2017, City Council approved the roundabout concept at the intersections identified above along with Hemingway Drive (Resolution No. 21169). The project includes the construction of bioretention facilities, buffered bike lanes, bus pullouts, sidewalks, ADA-compliant access ramps, storm drain lines, sanitary sewer lines, street lighting, landscaping, and other improvements. Project limits are from just east of Dartmouth Way to a point east of Independence Boulevard. Future phases are contingent on funding availability and obtaining all the necessary environmental permits.
Phase 1 of the Project was awarded to Granite Construction Company (Granite) on August 6, 2024 (Resolution No. 23053) with a total bid award of $15,637,796.93. Approximately 12%, $1,876,540.00 was allocated to construction contingencies.
At its August 27, 2025, meeting the Transportation Agency for Monterey County (TAMC) board of directors approved the allocation of $1, 721,723.75 of fair share funds and $1,000,000 of mid - cycle competitive grant funds from the Regional Surface Transportation Program (RSTP) for the Project. Fair share RSTP funds distributed by TAMC based on member agency population. Mid - cycle competitive g rants were allocated to projects that can use the funds in timely manner (construction to begin before July 2026).
Construction of Phase 1 of the Project began on November 12, 2024 , and is scheduled to be completed in fall 2026 . Several issues have been encountered after the start of construction that resulted in Contract Change Orders (CCOs), including: Changed the type of temporary fencing as specified by the California Department of Fish and Wildlife, and US Fish and Wildlife Service ; Project acceleration to accommodate the Regional Water Quality Control Board (RWQCB) Permit during winter work restriction ; Animal trench protection for California red -legged frog and California tiger salamander ; Temporary diversion measures; Additional traffic control; Unanticipated and unidentified b uried man-made objects; Demobilization due to the winter weather suspension; Remobilization and additional clearing and grubbing; Time-relates overhead costs; Storage of p recast concrete structures; Potholing; Sewer stub-outs; Waterstop for 60-inch pipe; Drainage system changes due to conflicts ; Underground utility conflicts, and other unforeseen underground work. To date, 24 CCOs ha ve been approved for a total cost of $1,853,590.24.
Staff is requesting a ppropriation of the total $2,721,723.75 of RSTP funds to the project contingencies for the Boronda Road Congestion Relief Project, Phase 1, CIP No. 9510 for a total construction contingency of $4,598,263.75.
CEQA CONSIDERATION:
The environmental impacts of the Project have been analyzed in accordance with CEQA guidelines. An Initial Study (IS) was prepared to evaluate the potential impacts associated with the project. Based upon review of the IS, the proposed project will not have a significant effect on the environment because the mitigation measures outlined in the Mitigation Monitoring and Reporting 401
Page | 3
Program (MMRP) have been included in the Project.
A Mitigated Negative Declaration (MND) was prepared for the Project pursuant to the provisions of CEQA, and on November 3, 2020, the Salinas City Council adopted and approved the MND and MMRP for the Project.
In addition, the following Environmental Permits have been received for Phases 1 & 2 of the Project:
A. Central Coast Regional Water Quality Control Board (Water Board):
Section 401 Permit/Water Quality Certification was issued by the Water Board last October 2021.
B. US Army Corps of Engineers (USACE):
USACE Nationwide Permit (NWP) (for Phases 1 & 2) was received on May 9, 2023. a. On April 24, 2023, a reinitiated Biological Opinion was issued by the US Fish and Wildlife Service, through the USACE consultation process. The reinitiated BO contains environmental measures to minimize effects to California red-legged frogs and California tiger salamanders.
b. A Consistency Determination dated September 22, 2023, was issued by the California Department of Fish and Wildlife. The Determination states that the Service’s incidental take statement and accompanying revised BO are consistent with the California Endangered Species Act (CESA).
CALIFORNIA GOVERNMENT CODE §84308 APPLIES:
No.
STRATEGIC PLAN INITIATIVE:
The project addresses the City Council’s Strategic Goals of Infrastructure, Public Safety, and Economic Development by improving an important corridor that allows residents to access primarily commerce centers and improves an intersection that directly impacts children safety.
DEPARTMENTAL COORDINATION:
The planning phase of this Project involved Public Works, Community Development, Finance, and Legal Departments. Public Works Department as the lead on the Project, coordinated closely with Community Development and Legal Departments in the review of the CEQA Documents , and there has been an extensive and iterative coordination effort between West Area Specific Plan, Central Area Specific Plan , including the developers, and the Boronda Road Congestion Relief Project to ensure consistency with the projects.
The design and permitting of the Project, included coordination with other City departments, including Fire and Community Development, and numerous outside agencies, including MST, the Water Board, USACE and the US Fish and Wildlife Service to receive final approval of the Project.
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Construction has required continued coordination with the permitting agencies, the Water Board and the USACE. Funding requests and reporting are coordinated through TAMC and internally with the Finance Department.
FISCAL AND SUSTAINABILITY IMPACT:
The approval of this appropriation has no impact on the General Fund. The requested funds were allocated to the Project by TAMC through the use of RSTP funds.
Fund
General Ledger Number
(Operating/CIP)
General Ledger Account
Name
*Remaining Budget
Appropriation
Amount Requested
5201 50.9510-66.4000 Capital Outlay
Improvements
$1,083,465.61 $2,721,723.75
*New RSTP Grant funds are not included in this amount.
ATTACHMENT:
Resolution
2025 TAMC Master Funding Agreement Exhibit A
403
RESOLUTION NO. (N.C.S.)
ACCEPTANCE OF REGIONAL SURFACE TRANSPORTATION PROGRAM GRANT
AND APPROPRIATION OF ADDITIONAL FUNDS FOR THE BORONDA ROAD CONGESTION RELIEF PROJECT, PHASE 1, CIP 9510
WHEREAS, on August 6, 2024, the Boronda Road Congestion Relief Project, Phase 1, CIP No. 9510, (Project) was awarded to Granite Construction Company through Resolution No. 23053; and
WHEREAS, at its board meeting on August 27, 2025, the Transportation Agency for Monterey County (TAMC) awarded a 2025 Mid-cycle Regional Surface Transportation Program (RSTP) Grant in the amount of $1,000,000 and approve d the programming of RSTP Fair Share funds in the amount of $1,721,723.75 for the Project subject to the terms and conditions of the 2023 Master Funding Agreement between TAMC and the City of Salinas executed on September 1, 2023; and
WHEREAS, staff is requesting increase in the construction contingencies appropriated for the Project by a total of $2,721,723.75 of RSTP funds.
NOW, THEREFORE, BE IT RESOLVED that the Salinas City Council accepts $1,721,723.75 of fair share funds and $1,000,000 of mid-cycle competitive grant funds from the Regional Surface Transportation Program (RSTP); and
BE IT FURTHER RESOLVED that the Salinas City Council approves an increase to the expenditure appropriation by $2,721,723.75 of total RSTP funds for project contingencies of the Boronda Road Congestion Relief Project, Phase 1, CIP No. 9510 for a total construction contingency of $4,598,263.75.
PASSED AND APPROVED this 3rd day of February 2026, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
________________________
Dennis Donohue, Mayor
ATTEST:
__________________________
Patricia M. Soratos, City Clerk
404
Transportation Agency for Monterey County
Master State and Federal Funding Agreement
Exhibit A
Citv of Salinas
Agency Board Approval Date Fund Expiration Date Type Active Projects Budget Paid Balance Outstanding Salinas
Salinas
Salinas
Sal inas
Salinas
Salinas
Salinas
8/2312017
812312023
8/23/2023
8/27 /202s
8/27 /202s
8/27 /202s
8/2sl2o2s
8/2r/202s
8122/2026
8122/2026
8/26/2028
8/26/2028
4,000,000.00
2,970,000.00
1,ss6,000.00
326,000.00
1,000,000.00
7,727,723.75
500,000.00
2,76t,316.45
4,000,000.00
208,683.5s
1,s56,000.00
91,985.40
1,000,000.00
r,72r,723.75
s00,000.00
RSTP
RSTP Competitive
RSTP Competitive
RSTP Quick-build
RSTP Mid-Cycle 2025
RSTP Fair Share
RSTP Fair Share
Project (Phase 1)
Downtown Salinas Complete Streets lmprovements
Harden Parkway Path and SRTS Project
East Market Street Cycle Track Quick Build
Boronda Road Con8estion Relief Project (Phase 1)
Boronda Road Congestion Relief Project (Phase 1)
Garner Avenue Bus Bulb Out
234,0r4.60
5 5
5 s
s
5 5
Agency Board Approval Date Fund Expiration Date Type Completed Proiects Budget Paid Balance Outstanding Salinas
5a lin as
Salinas
Salinas
Salinas
Salinas
Salinas
5alinas
Sa I inas
Salinas
Salinas
Salinas
3126/20t4
3/26/2014
3/2612074
8127 /2014
8/27/2Ot4
8/27 120L4
8/27 /2074
70/2312079
12/4/2019
8/2612020
Completed
Completed
Completed
Completed
Completed
Completed
Completed
Completed
Completed
Completed
Completed
RSTP Fair Share East Market St. Phase 3 5
s
s
s
s
s
5 s
s
s
s
)
1s6,000.00 s
50,000.00 s
1,000,000.00 s
47,548.84 5
310,000.00 s
25,099.00 s
910,532.58 S
147,551.36 5
613,850.60 5
109,551.28 s
1,800,000.00 s
531,592.49 s
1s6,000.00 s
50,000.00 s
1,000,000.00 s
47,548.84 5
310,000.00 s
2s,099.00 s
910,532.58 5
147,551.36 5
613,8s0.60 s
109,551.28 s
1,800,000.00 s
531,592.49 s
RSTP Fair Share
RSTP Fair Share
RSTP Fair Share
RSTP Competitive
RSTP Fair Share
RSTP Fair Share
RSTP Fair Share
RSTP Falr Share
RSTP Safe Streets
RSTP Competitive
Sidewalk Repairs Program
Sanborn Road / US 101 / Elvee Drive
Sanborn Rd. - John St. lnteresection lmprovement
Downtown Salinas Complete Streets lmprovements
Salinas vibrancy Plan
Alisal - Skyway Roundabout
Sanborn Road Highway Safety lmprovement Program (HSIP) Local Match East Laurel Pedestrian lmprovement Project
East Rossi Street Safe Street Project
Bardin Road Safe Routes to School Enhancement Project
RSTP Com Pedestrian Enhancement Project
Last Revised: 7;/Z )r/,428127/ZOzs Approved by:
Todd Muck, Executive Director
https.//tamcmonterey.sharepoint.com/Shared Documents/TAMC NEWFunding/01_Master Agreements & Exhibit A/Exhibit A/TAMC Master State - Fed Funding Agreement Exhibit A s
5 s
s
s
s
s
s
5 s
s
s
405
City of Salinas
Legislation Text
200 Lincoln Ave., Salinas,
CA 93901
www.cityofsalinas.org
File #: ID#26-025, Version: 1
Approval of 2026 Fire Equipment Lease and Direct Purchase Approve a Resolution approving an Equipment Lease/Purchase Agreement and an Escrow and Account Control Agreement and authorizing certain actions in connection therewith relating to the financing of certain equipment for the City; and approve the appropriation of $1,477,678 to the Vehicle Replacement Fund (7121) with a corresponding transfer in from the General Fund for direct purchase of two apparatuses.
City of Salinas Printed on 1/29/2026Page 1 of 1
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CITY OF SALINAS
COUNCIL STAFF REPORT
DATE: FEBRUARY 3, 2026
DEPARTMENT: FINANCE
FROM: SELINA ANDREWS, FINANCE DIRECTOR
TITLE: APPROVAL OF 2026 FIRE EQUIPMENT LEASE AND DIRECT
PURCHASE
RECOMMENDED MOTION:
It is recommended that Council approve a Resolution to:
1. Approve an Equipment Lease/Purchase Agreement and an Escrow and Account Control Agreement and authorizing certain actions in connection therewith relating to the financing of certain equipment for the City; and
2. Approve the appropriation of $1,477,678 to the Vehicle Replacement Fund (7121) with a corresponding transfer in from the General Fund for direct purchase of two apparatuses.
EXECUTIVE SUMMARY:
The Salinas Fire Department is requesting approval to purchase two Pierce Enforcer Type 1 fire engines, one Pierce 100’ Enforcer Tractor Drawn Aerial , and one BME Type 6 Wildland engine from Golden State Fire Apparatus. The purchases will be made through cooperative contract agreements with Sourcewell and HGAC Buy, in compliance with Salinas City Code Section 12 -
27. Staff recommends a combination of lease equipment financing and direct purchase, utilizing $1,477,678 in cash and reserves from the sale of City surplus property as approved on December 9, 2025 to purchase one Pierce Enforcer Type 1 fire engine and the BME Type 6 Wildland engine and financing $3, 232,406 to purchase the Pierce 100’ Enforcer Tractor Drawn Aerial and one Enforcer Type 1 engine (the “Financed Equipment”) . The table below summarizes the cost and funding sources of these four vehicles:
Vehicle Type Purchase Amount Funding Source
Pierce Enforcer Type 1 1,043,425.32 Cash & Reserves
Pierce Enforcer Type 1 1,043,425.32 2026 Lease
Pierce 100' Enforcer Tractor Drawn Aerial 2,188,980.63 2026 Lease BME Type 6 Wildland Engine 434,251.94 Cash & Reserves
Total Vehicle Cost 4,710,083.21
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The Financed Equipment will be purchased using a tax -exempt equipment lease purchase agreement and requested interest rates from banks for a 7-year and 10-year tax-exempt equipment lease (“2026 Lease”). The 7-year proposal from Banc of America Public Capital Corp (“BAPCC”) was the most advantageous to the City . City staff propose s to enter into a n Equipment Lease/Purchase Agreement with BAPCC and an Escrow and Account Control Agreement with Argent Institutional Trust Company (collectively, the “Financing Agreements”) . City Council approval of the resolution and the Financing Agreements will authorize City staff to sign the documents and take other necessary action s. Staff expect to execute the Financing Agreements and close the 2026 Lease by mid-February.
BACKGROUND:
The Fire Department has been working diligently to bring its fleet into a state of good repair and maintain a fire apparatus and vehicle replacement program consistent with best practices. To achieve this goal, the department requires the replacement of two fire engines and one tiller ladder truck, as well as replacing the existing Type 3 wildland vehicle with two Type 6 models to improve access to hard -to-reach wildland areas. One Type 6 unit has already been ordered. The Fire Department’s replacement program calls for rotating front -line engines every 8 – 10 years and aerial trucks every 15 years, consistent with use and in line with National Fire Protection Association standards (NFPA).
On September 23, 2025, Council approved the sale of City surplus property located at 342 Front Street and 323 California Street to the Monterey County Office of Education in the amount of $2,500,000. As approved on December 9, 2025, a portion of these proceeds will be used to purchase one Type 1 Fire Engine and the BME Type 6 Wildland Engine thereby reducing the amount financed by the City. The Financed Equipment will be acquired through lease equipment financing and at an equipment cost of $3,232,406.
The City engaged NHA Advisors LLC (“NHA”) as municipal financial advisor to assist with the financing process. Due to the relatively small size of the equipment lease, NHA and City staff decided to utilize a private placement process (direct loan with a bank), rather than a public offering (bond issued to investors). NHA solicited bids from 10 active regional and national banks for this type of financing structure and requested interest rates for a 7-year and 10-year tax-exempt equipment lease. Six banks responded with interest rates ranging from 3.49% to 4.20% on the 7- year structure and 3.78 % to 4.76% on the 10 -year structure. The 7-year proposal from Bank of America Public Capital Corp (“ BAPCC”) was the most advantageous to the City due to the following reasons:
Lowest interest rate (3.49%)
BAPCC will provide all the lease documents – the City will not need to engage special counsel to prepare the documents
A tax opinion is not required
City already has 2012 Master Agreement in place that governs how this 2026 Lease will be structured
No bank fees are associated with the loan
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City will not need to pay for escrow agent services using Argent Institutional Trust Company as escrow agent (BAPCC will pay this cost)
The 2026 Lease will have a 7-year term, maturing December 1, 2032. The interest rate is fixed at
3.49% and is also locked through the anticipated closing of the 2026 Lease, mitigating the risk that interest rates rise in the next few weeks before the 2026 Lease closes and funds. The 2026 Lease is expected to be sized to $3,261,000, which will cover the equipment purchase cost and the costs of issuing the 2026 Lease. The resolution requests authorization for staff to enter into the agreement subject to the final lease amount being less than a not-to-exceed amount of $3,265,000 and the interest rate being less than a not -to-exceed amount of 3.55%. These amounts are intentionally set slightly higher than the actual expected amounts to provide a little contingency in case of any unforeseen delays.
The 2026 Lease has level annual debt service at approximately $529,955 per year over the next 7 years. The first payment is due December 1, 2026 (fiscal year 2026 -27). The Lease becomes pre- payable in full after half of the term at par on any regularly scheduled payment date.
In order for the City to enter into the 2026 Lease, City Council will need to adopt a resolution approving the Financing Agreements and authorizing City staff to execute the Financing Agreements and take other necessary actions.
Discussion of Lease Documents:
2012 Master Agreement : The Master Equipment Lease/Purchase Agreement (“ MELPA”) outlines the terms governing the 2026 Lease. The City originally entered into this MELPA with BAPCC in June 2012 and has used it several times over the years to finance vehicles (Schedules of Property No. 1, No. 2, and No. 3). The MELPA identifies the overall structure of the financing, details that the security for the financing is a lien on the equipment, and describes the terms and covenants between the City and BAPCC.
Schedule of Property No. 4 (also referred to herein as “2026 Lease”): Schedule of Property No. 4 identifies the vehicles being purchased that will provide the security for the 2026 Lease through a lien on the equipment. This lien will be in place until the 2026 Lease matures on $0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
2027 2028 2029 2030 2031 2032 2033
Fiscal Year
2026 Lease - Proposed Debt Service
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December 1, 2032, or is otherwise prepaid in accordance with the lease terms. This document also contains the payment details, prepayment provisions, and other covenants of the City. A detailed payment schedule for the 2026 Lease can be found in Exhibit A-1 of Schedule of Property No. 4.
Escrow and Account Control Agreement: The Escrow and Account Control Agreement (“Escrow Agreement”) is among BAPCC, the City of Salinas, and Argent Institutional Trust Company as Escrow Agent. The Escrow Agreement identifies the various covenants between the City and the Escrow Agent. The Escrow Agent will hold the proceeds of the 2026 Lease starting on the closing/funding day and will distribute them to pay debt service on the 2026 Lease.
CEQA CONSIDERATION:
Not a Project . The City of Salinas has determined that the proposed action is not a project as defined by the California Environmental Quality Act (CEQA) (CEQA Guidelines Section 15378).
In addition, CEQA Guidelines Section 15061 includes the general rule that CEQA applies only to activities which have the potential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibilit y that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. Because the proposed action and this matter have no potential to cause any effect on the environment, or because it falls within a category of activities excluded as projects pursuant to CEQA Guidelines section 15378, this matter is not a project. Because the matter does not cause a direct or foreseeable indirect physical change on or in the environment, this matter is not a project. Any subsequent discretionary projects resulting from this action will be assessed for CEQA applicability.
CALIFORNIA GOVERNMENT CODE §84308 APPLIES:
Yes.
STRATEGIC PLAN INITIATIVE:
This agenda item supports City Council’s goal of Public Safety by ensuring the City maintains a reliable fire apparatus and vehicle replacement program consistent with best practices.
DEPARTMENTAL COORDINATION:
This staff report was coordinated by the Finance and Fire departments.
FISCAL AND SUSTAINABILITY IMPACT:
The 2026 Lease will have no financial impact on the FY 202 5-26 budget cycle. The 2026 Lease has level annual debt service payments, with just over $ 527,000 due in fiscal year 202 6-27, and approximately $529,000 due annually thereafter through fiscal year 2032-33 (final maturity of the 2026 Lease).
The costs associated with issuing the 2026 Lease will be paid out of the proceeds of the 2026 Lease (no direct budgetary impact).
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As mentioned, the direct purchase for two of the apparatuses total $ 1,477,678. Staff is recommending an appropriation to the Vehicle Replacement Fund (7121) with a corresponding transfer out from the General Fund.
Fund
General Ledger Number
(Operating/CIP)
General Ledger Account
Name
Remaining Budget
Appropriation
Amount Requested
7121 45.4510-66.5500 Capital Outlays Vehicles $201,000 $1,477,678 7121 00.0000-90.1000 Transfer In $0 $1,477,678
1000 00.0000-95.7121 Transfer Out $0 $1,477,678
ATTACHMENTS:
1. Resolution
2. 2012 MELPA
3. Schedule of Property No. 4
4. Escrow and Account Control Agreement
5. BAPCC’s Term Sheet
6. Presentation
411
RESOLUTION NO. ________(N.C.S.)
A RESOLUTION AUTHORIZING THE EXECUTION OF A FINANCING
AGREEMENT WITH BANC OF AMERICA PUBLIC CAPITAL CORP TO
PROVIDE FINANCING FOR PURCHASE OF FIRE ENGINES AND
AUTHORIZING RELATED ACTIONS
WHEREAS, the City of Salinas, California ("City") is a charter city organized pursuant to the California Constitution and with authority derived directly from Article XI of the California Constitution;
WHEREAS, the City of Salinas Fire Department has been working diligently to bring our fleet into a state of good repair and maintain a fire apparatus and vehicle replacement program consistent with best practices. To achieve this goal, the department requires the replacement of two fire engines and one tiller ladder truck, along with the addition of a Type 6 wildland vehicle to improve access to hard-to-reach wildland areas; and WHEREAS, Golden State Fire Apparatus, Inc. has provided proposals for the purchase of two Pierce Enforcer Type 1 engines, one Pierce 100’ Enforcer Tractor Drawn Aerial truck, and one BME Type 6 Wildland engine; and
WHEREAS, the purchase of the vehicles through Golden State Fire Apparatus, Inc. was duly authorized at December 9, 2025, City Council meeting; and WHEREAS, the City of Salinas intends to finance the purchase of one Pierce Enforcer Type 1 engine and one Pierce tiller ladder truck (the “Financed Equipment”) through a lease- purchase agreement and such financing may include prepayment and contingency provisions; and
WHEREAS, the City solicited proposals from banks to provide the lease -purchase agreement and in response to that solicitation the City received six proposals, of which the proposal from Banc of America Public Capital Corp (“BAPCC”) was determined to be the most economically beneficial to the City; and
WHEREAS, the City had previously entered into a Master Equipment Lease/Purchase Agreement, dated June 1, 2012, with Banc of America Public Capital Corp (2012 MELPA) to provide for the financing for vehicles and other equipment, and the City has us ed that 2012 MELPA as the basis for several subsequent financings in the past , including Schedule of Property No. 1, Schedule of Property No. 2, and Schedule of Property No. 3; and WHEREAS, pursuant to a proposed Summary of Terms and Conditions, dated January 6, 2026, Banc of America Public Capital Corp has offered to enter into an Schedule of Property No. 4 under the 2012 MELPA between the City as Lessee, and Banc of America Public Capital Corp or its affiliate as Lessor;
WHEREAS, pursuant to a proposed Summary of Terms and Conditions, dated January 6, 2026, Banc of America Public Capital Corp or its affiliate has offered to enter into an Escrow 412
and Account Control Agreement ("Escrow Agreement" ) with City and Argent Institutional Trust Company , as escrow agent, under terms that are beneficial to the City, the Escrow Agreement and Schedule of Property No. 4, incorporating the terms of the 2012 MELPA, with related documents hereinafter referred to as “Financing Agreement”; WHEREAS, in accordance with Government Code Section 5852.1, the City Council has obtained and disclosed the information set forth in Exhibit A hereto; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL, AS FOLLOWS:
Section 1. Recitals. All of the recitals herein contained are true and correct and are fully incorporated herein by this reference.
Section 2. Authorization to Purchase Vehicles and Appropriate Funds. City staff are hereby authorized to purchase two Pierce Enforcer Type 1 engines, one Pierce tiller ladder truck, and one BME Type 6 Wildland Engine. Additionally, City staff are authorized to appropriate $1,477,678 to the Vehicle Replacement Fund with a corresponding transfer in the General Fund for direct purchase of one Pierce Enforcer Type 1 engine and the BME Type 6 Wildland Engine.
The remaining two tucks are the Financed Equipment.
Section 3. Financing Agreement Approval. The forms of the Financing Agreement, in the forms on file with the City Clerk, are hereby approved, with such changes thereto, deletions therefrom and additions or modifications thereto as may be approved pursuant to Section 4 hereof; provided that the par amount of the Financing Agreement shall not exceed $ 3,265,000 and the initial, tax exempt interest rate shall not exceed 3.50% (exclusive of adjustments to the rate upon an event of default or event of taxability).
Section 4. Execution and Delivery. Any one of the City Manager, the Finance Director, or any deputy thereof, or person duly appointed in writing to act in the stead of such officer (collectively, the “Responsible Officers”), is hereby authorized and directed for and in the name of and on behalf of the City to execute and deliver the Financing Agreement, in substantially the form presented to and considered at this meeting, with such changes therein, deletions therefrom and additions thereto as may be approved (i) by any Responsible Officer, in such person’s discretion, as being in the best i nterests of the City, (ii) as to form, by City Attorney; such approval to be conclusively evidenced by the execution and delivery thereof by the person executing the same on behalf of the City.
Section 5. Further Actions. The Responsible Officers are, an d each of them acting alone is, hereby authorized and directed to take such actions and to execute such documents and certificates as may be necessary to effectuate the purposes of this resolution, including the execution and delivery of the Financing Agreement, and execution and delivery of any and all memorandums of agreement or understanding, assignments, certificates, requisitions, agreements, notices, consents, instruments of conveyance, warrants and other documents, which they, or any of them, deem necessary or advisable in order to consummate the transactions and requirements as described herein.
Section 6. No General Liability. Nothing contained in this Resolution, the Financing Agreement nor any other instrument shall be construed with respect to the Lessee as incurring a pecuniary 413
liability or charge upon the general credit of the Lessee or against its taxing power, nor shall the breach of any agreement contained in this Resolution, the Financing Agreement, or any other instrument or document executed in connection therewith impose any pecuniary liability upon the Lessee or any charge upon its general credit or against its taxing power, except to the extent that the Rental Payments payable under the Financing Agreement are limited obligations of the Lessee, subject to annual appropriation, as provided in the Financing Agreement.
Section 7. Ratification. All actions heretofore taken by any officer of the City with respect to the execution and delivery of the Financing Agreement, and the financing of the equipment and projects described therein are hereby approved, confirmed and ratified.
Section 8. Effective Date. This Resolution shall take effect upon approval. 414
PASSED AND APPROVED this 3rd day of February, 2026, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
________________________________
Dennis Donohue, Mayor
ATTEST:
_________________________________
Patricia M. Soratos, City Clerk
Attachment: Exhibit A (Government Code section 5852.1 Disclosure)
The City Clerk of the City of Salinas, California does hereby certify that the foregoing Resolution was introduced and duly passed and adopted by the City Council at a regularly scheduled meeting thereof held on this date, by the forgoing vote.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City, California on this date.
___________________________________
Patricia M. Soratos, City Clerk
415
EXHIBIT A
GOVERNMENT CODE SECTION 5852.1
DISCLOSURE
The following information consists of estimates that have been provided by NHA Advisors, the City’s Municipal Advisor, as required by Section 5821.1 of the California Government Code, which has been provided to the City in good faith:
(A) True interest cost of the Equipment Lease/Purchase Agreement (“Lease”):
3.46%
(B) Finance charge of the Lease (sum of all costs of issuance and fees/charges paid to third parties): $28,594
(C) Net proceeds to be received (net of finance charges, reserves and capitalized interest, if any): $3,232,406
(D) Total payment amount through maturity: $3,707,475
416
MASTER EQUIPMENT LEASE/PURCHASE AGREEMENT
This Master Equipment Lease/Purchase Agreement (the "Agreement") dated as of June 1, 2012 and entered into between Banc of America Public Capital Corp, a Kansas corporation ("Lessor"), and City of Salinas, a charter city and municipal corporation existing under the laws of the State of California ("Lessee ").
WITNESSETH:
WHEREAS, Lessee desires to lease and acquire from Lessor certain Equipment described in each Schedule (as each such term is defined herein), subject to the terms and conditions of and for the purposes set forth in each Lease; and in the event of a conflict the terms of a Schedule prevail; and
WHEREAS, the relationship between the parties shall be a continuing one and items of equipment may be added to the Equipment from time to time by execution of additional Schedules by the parties hereto and as otherwise provided herein; and WHEREAS, Lessee is authorized under the constitution and laws of the State to enter into this Agreement and the Schedules hereto for the purposes set forth herein; Now, THEREFORE, for good and valuable consideration, receipt of which is hereby acknowledged, and in consideration of the premises hereinafter contained, the parties hereby agree as follows:
ARTICLE I
Section 1.01. Definitions. The following terms will have the meanings indicated below unless the context clearly requires otherwise:
"Acquisition Amount" means the amount specified in each Lease and represented by Lessee to be sufficient to acquire the Equipment listed in such Lease, which amount shall be not less than $100,000 for each Lease.
"Acquisition Fund" means, with respect to any Lease, the fund established and held by the Acquisition Fund Custodian pursuant to the related Acquisition Fund Agreement, if any. "Acquisition Fund Agreement" means, with respect to any Lease, an Acquisition Fund and Account Control Agreement in form and substance acceptable to and executed by Lessee, Lessor and the Acquisition Fund Custodian, pursuant to which an Acquisition Fund is established and administered.
"Acquisition Fund Custodian" means the Acquisition Fund Custodian identified in any Acquisition Fund Agreement, and its successors and assigns. #7 6567 4 v l (BAPCC/CA Abatement Lease Template) CA Abatement 417
"Acquisition Period" means, with respect to each Lease, that period stated in the Schedule to such Lease during which the Lease Proceeds attributable to such Lease may be expended on Equipment Costs.
"Agreement" means this Master Equipment Lease/Purchase Agreement, including the exhibits hereto, together with any amendments and modifications to the Agreement pursuant to Section 13.05.
"Code" means the Internal Revenue Code of 1986, as amended. Each reference to a Section of the Code herein shall be deemed to include the United States Treasury Regulations proposed or in effect thereunder.
"Commencement Date" means, for each Lease, the date when Lessee's obligation to pay rent commences under such Lease, which date shall be the earlier of (i) the date on which the Equipment listed in such Lease is accepted by Lessee in the manner described in Section 5.01, and (ii) the date on which sufficient moneys to purchase the Equipment listed in such Lease are deposited for that purpose with an Acquisition Fund Custodian. "Equipment " means the property listed in each of the Leases and all replacements, repairs, restorations, modifications and improvements thereof or thereto made pursuant to Section 8.01 or Article V. Whenever reference is made in this Agreement to Equipment listed in a Lease, such reference shall be deemed to include all such replacements, repairs, restorations, modifications and improvements of or to such Equipment. "Equipment Costs" means the total cost of the Equipment listed in each Lease, including all delivery charges, installation charges, capitalizable consulting and training fees approved by Lessor, legal fees, financing costs, and other costs necessary to vest full, clear legal title to the Equipment in Lessor, and otherwise incurred in connection with the financing provided by the lease-purchase of the Equipment as provided in each Lease; provided that in no event shall approved consulting and training fees or other non-capitalizable "soft" costs relating to the Equipment listed in any Lease which are to be financed by Lessor hereunder exceed 2% of the total cost of such Equipment as determined by Lessor; and provided further, that in no event shall capitalizable delivery charges, installation charges, taxes and similar capitalizable "soft costs" relating to such Equipment be included without Lessor's prior consent. "Expense Fund" means, with respect to any Lease, the fund established and held by the Acquisition Fund Custodian pursuant to the related Acquisition Fund Agreement , if any. "Event of Default " means an Event of Default described in Section 12.01. "Lease " means a Schedule and the terms of this Agreement which are incorporated by reference into such Schedule. Each Schedule shall constitute a separate and independent Lease. "Lease Proceeds " means, with respect to each Lease, the total amount of money to be paid by Lessor to the Acquisition Fund Custodian for deposit and application in accordance with such Lease and the Acquisition Fund Agreement.
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"Lease Term" for each Lease shall begin on the Commencement Date thereof and continue as specified in the Schedule applicable thereto. "Lessee" means the entity referred to as Lessee in the first paragraph of this Agreement. "Lessor" means (a) the entity referred to as Lessor in the first paragraph of this Agree ment or (b) any assignee or transferee of any right, title or interest of Lessor in and to the Equipment under a Lease or any Lease (including Rental Payments thereunder) pursuant to Section 11.01, but does not include any entity solely by reason of that entity retaining or assuming any obligation of Lessor to perform under a Lease. "Maximum Equipment Cost" means $3,000,000.00.
"Purchase Price" means, with respect to the Equipment listed on a Lease, the amount that Lessee may pay to Lessor to purchase such Equipment as provided in such Lease. "Rental Payments" means the basic rental payments payable by Lessee under each Lease pursuant to Section 4.01, in each case consisting of a principal component and an interest component.
"Schedule " means each separately numbered Schedule of Property substantially in the form of Exhibit A hereto together with a Rental Payment Schedule attached thereto substantially in the form of Exhibit A- 1 hereto.
"State " means the State of California.
"Utilization Period" means the date by which Lessee must deliver an Acceptance Certificate for the Equipment under such Lease as indicated in Section 3.05(b). "Vendor" means the manufacturer or supplier of the Equipment or any other person as well as the agents or dealers of the manufacturer or supplier from whom Lessor arranged Lessee's acquisition and financing of the Equipment pursuant to the applicable Lease.
ARTICLE II
Section 2.01. Representations and Covenants of Lessee. Lessee represents, covenants and warrants for the benefit of Lessor on the date hereof and as of the Commencement Date of each Lease as follows:
(a) Lessee is a state or a political subdivision thereof within the meaning of Section 103( c) of the Code, duly organized and existing under the constitution and laws of the State with full power and authority to enter into this Agreement and each Lease and the transactions contemplated hereby and to perform all of its obligations hereunder and under each Lease.
(b) Lessee has duly authorized the execution and delivery of this Agreement and each Lease by proper action of its governing body at a meeting duly called, regularly convened and attended throughout by the requisite quorum of the members thereof, or by other appropriate #765674vl (BAPCC/CA Abatement Lease Template) 3
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official approval , and all requirements have been met and procedures have occurred in order to ensure the validity and enforceability of this Agreement and each Lease. ( c) No event or condition that constitutes, or with the giving of notice or the lapse of time or both would constitute, an Event of Default exists at the date hereof. ( d) Lessee will do or cause to be done all things necessary to preserve and keep in full force and effect its existence as a body corporate and politic. ( e) Lessee has complied with such public bidding requirements as may be applicable to this Agreement and each Lease and the acquisition by Lessee of the Equipment as provided in each Lease.
(f) During the Lease Term, the Equipment will be used by Lessee only for the purpose of performing essential governmental or proprietary functions of Lessee consistent with the permissible scope of Lessee's authority. Lessee does not intend to sell or otherwise dispose of the Equipment or any interest therein prior to the last Rental Payment (including all Renewal Terms) scheduled to be paid under each Lease.
(g) Lessee shall keep its books and records in accordance with generally accepted accounting principles and practices consistently applied and shall deliver to Lessor (i) annual audited financial statements (including (1) a balance sheet, (2) statement of revenues, expense s and changes in fund balances for budget and actual, (3) statement of cash flows and notes , and ( 4) schedules and attachments to the financial statements) within 210 days of its fiscal year end, (ii) such other financial statements and information as Lessor may reasonably request , and (iii) its annual budget for the following fiscal year within 90 days of the current fiscal year end. Such annual audited financial statements shall be accompanied by an unqualified opinion of Lessee ' s auditor. Credit information relating to Lessee may be disseminated among Lessor and any of its affiliates and any of their respective successors and assigns. (h) Lessee has kept, and throughout the Lease Term of this Agreement will keep, its books and records in accordance with generally accepted accounting principles. (i) Lessee has an immediate need for the Equipment listed on each Schedule and expects to make immediate use of the Equipment listed on each Schedule. Lessee 's need for the Equipment is not temporary and Lessee does not expect the need for any item of the Equipment to diminish during the Lease Term to such item.
G) The payment of the Rental Payments or any portion thereof is not (under the terms of any Lease or any underlying arrangement) directly or indirectly (x) secured by any interest in property used or to be used in any activity carried on by any person other than a state or local governmental unit or payments in respect of such property; or (y) on a present value basis, derived from payments (whether or not to Lessee) in respect of property, or borrowed money, used or to be used in any activity carried on by any person other than a state or local governmental unit. The Equipment will not be used, directly or indirectly, in any activity carried on by any person other than a state or local governmental unit. No portion of the Equipment Costs for the Equipment will be used, directly or indirectly , to make or finance loans to any #765674v l (BAPCC/CA Abatement Lease Template) 4
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person other than Lessee. Lessee has not entered into any management or other service contract with respect to the use and operation of the Equipment. (k) There is no pending litigation, tax claim, proceeding or dispute that may adversely affect Lessee's financial condition or impairs its ability to perform its obligations hereunder.
Lessee will, at its expense, maintain its legal existence in good standing and do any further act and execute, acknowledge, deliver, file, register and record any further documents Lessor may reasonably request in order to protect Lessor's interest in the Equipment and Lessor's rights and benefits under this Lease.
ARTICLE Ill
Section 3.01. Lease of Equipment. Subject to the terms of this Master Lease, Lessor agrees to provide the funds specified in each Lease to be provided by it to acquire the Equipment, up to an amount equal to the Maximum Equipment Cost. Upon the execution of each Lease, Lessor demises, leases, transfers and lets to Lessee, and Lessee acquires, rents and leases from Lessor, the Equipment as set forth in such Lease and in accordance with the terms thereof.
Section 3. 02. Continuation of Lease Term. Lessee intends, subject to Section 3.03, to continue the Lease Term of each Lease and to pay the Rental Payments thereunder. Lessee affirms that sufficient funds are available for the current fiscal year, and Lessee reasonably believes that an amount sufficient to make all Rental Payments during the entire Lease Term of each Lease can be obtained from legally available funds of Lessee. Lessee further intends to do all things lawfully within its power to obtain and maintain funds sufficient and available to discharge its obligation to make Rental Payments due hereunder, including making provision for such payments to the extent necessary in each budget or appropriation request submitted and adopted in accordance with applicable provisions of law, to have such portion of the budget or appropriation request approved and to exhaust all available reviews and appeals in the event such portion of the budget or appropriation request is not approved.
Section 3. 03. Abatement. During any period in which, by reason of material damage or destruction or taking under the power of eminent domain ( or sale to any entity threatening the use of such power) or material title defect with respect to any Equipment, there is substantial interference with the use and possession by Lessee of such Equipment, the rent applicable to such Equipment shall be abated proportionately in whole or in part. Lessee shall immediately notify Lessor upon the occurrence of any event causing substantial interference with Lessee's use and possession of any Equipment, and such notice shall be provided prior to the abatement of any rent. The amount of abatement shall be such that the remaining rental obligation for each rental period represents fair consideration for the use and possession of the portions of the Equipment that are not affected by such interference. Such abatement shall commence on the date that Lessee's use and possession of the affected Equipment is restricted because of such interference and end on the earlier of (i) the date on which the use and possession thereof are restored to Lessee, or (ii) the date on which Lessee either (x) replaces the affected Equipment or (y) uses the proceeds of insurance or condemnation award to pay the applicable Purchase Price therefor.
Notwithstanding any such interference with Lessee's use and possession of a portion of the Equipment, this Lease shall continue in full force and effect with respect to any remaining #765674vl (BAPCC /CA Abatement Lease Template) 5
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Equipment. Lessee waives the benefits of Civil Code Sections 1932 and any and all other rights to terminate this Lease by virtue of any interference with the use and possession of any Equipment.
Section 3. 04. Conditions to Lessor's Performance.
(a) As a prerequisite to the performance by Lessor of any of its obligations pursuan t to any Lease, Lessee shall deliver to Lessor the following:
(i) A fully completed Schedule, executed by Lessee;
(ii) An Acquisition Fund Agreement, executed by Lessee and the Acquisition Fund Custodian, unless Lessor pays 100% of the Acquisition Amount directly to the Vendor upon execution of the Lease;
(iii) A Certificate executed by the Clerk or Secretary or other comparable officer of Lessee, in substantially the form attached hereto as Exhibit C, completed to the satisfaction of Lessor;
(iv) A certified copy of a resolution or other official action of Lessee's governing body authorizing the execution and delivery of this Lease and performance by Lessee of its obligations hereunder;
(v) An opinion of counsel to Lessee in substantially the form attached hereto as Exhibit D respecting such Lease and otherwise satisfactory to Lessor; (vi) Evidence of insurance as required by Section 7 .02 hereof; (vii) All documents, including financing statements, affidavits, notices and similar instruments, in form satisfactory to Lessor, which Lessor deems necessary or appropriate at that time pursuant to Section 6.01 and 6.02; (viii) A copy of a fully completed and executed Form 8038; (ix) An Essential Use/Source of Funds Certificate in substantially the fom1 attached as Exhibit E; and
(x) Such other items, if any, as are set forth in such Lease or are reasonably required by Lessor.
(b) In addition, the performance by Lessor of any of its obligations pursuant to any Lease shall be subject to: (i) no material adverse change in the financial condition of Lessee since the date of this Lease, (ii) no Event of Default having occurred, and (iii) if no Acquisition Fund has been established, the Equipment must be accepted by Lessee no later than December 31, 2013 (the "Utilization Period").
(c) Subject to satisfaction of the foregoing, Lessor will pay the Acquisition Amount for Equipment described in a Schedule to the Vendor upon receipt of the documents described in Sections 5.0l(a) and (b); or if an Acquisition Fund has been established pursuant to an #765674vl (BAPCC/CA Abatement Lease Template) 6
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Acquisition Fund Agreement, Lessor will deposit the Acquisition Amount for Equipment described in the Schedule with the Acquisition Fund Custodian. ( d) This Agreement is not a commitment by Lessor to enter into any Lease not currently in existence, and nothing in this Agreement shall be construed to impose any obligation upon Lessor to enter into any proposed Lease, it being understood that whether Lessor enters into any proposed Lease shall be a decision solely within Lessor's discretion. (e) Lessee will cooperate with Lessor in Lessor's review of any proposed Lease.
Without limiting the foregoing, Lessee will provide Lessor with any documentation or information Lessor may request in connection with Lessor's review of any proposed Lease. Such documentation may include, without limitation, documentation concerning the Equipment and its contemplated use and location and documentation or information concerning the financial status of Lessee and other matters related to Lessee.
ARTICLE IV
Section 4.01. Rental Payments. Lessee shall promptly pay Rental Payments, in lawful money of the United States of America, to Lessor on the dates and in such amounts as provided in each Lease. Lessee shall pay Lessor a charge on any Rental Payment not paid on the date such payment is due at the rate of 12% per annum or the maximum amount permitted by law, whichever is less, from such date. Lessee shall not permit the federal government to guarantee any Rental Payments under any Lease. Rental Payments consist of principal and interest payments as more fully detailed on each Schedule, the interest on which begins to accrue as of the Commencement Date for each such Schedule.
Section 4. 02. Interest and Principal Components. A portion of each Rental Payment is paid as, and represents payment of, interest, and the balance of each Rental Payment is paid as, and represents payment of, principal. Each Lease shall set forth the principal and interest components of each Rental Payment payable thereunder during the Lease Term.
Section 4.03. Rental Payments to Constitute a Current Expense of Lessee. Lessor and Lessee understand and intend that the obligation of Lessee to pay Rental Payments under each Lease shall constitute a current expense of Lessee payable solely from its general fund or other funds that are legally available for that purpose and shall not in any way be construed to be a debt of Lessee in contravention of any applicable constitutional or statutory limitation or requirement concerning the creation of indebtedness by Lessee, nor shall anything contained herein or in a Lease constitute a pledge of the general tax revenues, funds or moneys of Lessee.
Section 4.04. Rental Payments to be Unconditional. Except as provided in Section 3.03, the obligations of Lessee to make Rental Payments and to perform and observe the other covenants and agreements contained in each Lease shall be absolute and unconditional in all events without abatement, diminution, deduction, set-off or defense, for any reason, including without limitation any failure of the Equipment, after it has been accepted by lessee, any defects, malfunctions, breakdowns or infirmities in the equipment or any accident, condemnation or unforeseen circumstances . Lessee' s obligations to make Rental Payments or pay other amounts #765674vl (BAPCC/CA Abatement Lease Template) 7
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hereunder shall not be abated on account of obsolescence or failure of the Equipment to perform as desired.
Section 4. 05. Tax Covenant. Lessee agrees that it will not take any action that would cause the interest component of Rental Payments to be or to become ineligible for the exclusion from gross income of the owner or owners thereof for federal income tax purposes, nor will it omit to take or cause to be taken, in timely manner, any action, which omission would cause the interest component of Rental Payments to be or to become ineligible for the exclusion from gross income of the owner or owners thereof for federal income tax purposes.
Section 4. 06. Event of Taxability. Upon the occurrence of an Event of Taxability, the interest component shall be at a Taxable Rate retroactive to the date as of which the interest component is determined by the Internal Revenue Service to be includible in the gross income of the owner or owners thereof for federal income tax purposes, and Lessee will pay such additional amount as will result in the owner receiving the interest component at the Taxable Rate identified in the related Lease.
For purposes of this Section, "Event of Taxability " means a determination that the interest component is includible for federal income tax purposes in the gross income of the owner thereof due to Lessee ' s action or failure to take any action.
Section 4. 07. Mandatory Prepayment. If the Lease Proceeds are deposited into an Acquisition Fund, any funds remaining in the Acquisition Fund on or after the Acquisition Period and not applied to Equipment Costs, shall be applied by Lessor on the next Rental Payment date, pro rata to the prepayment of the principal component of the outstanding Rental Payments due under the applicable Schedule.
ARTICLE V
Section 5. OJ. Delivery, Installation and Acceptance of Equipment. (a) Lessee shall order the Equipment, cause the Equipment to be delivered and installed at the location specified in the Leases and pay any and all delivery and installation costs and other Equipment Costs in connection therewith. When the Equipment listed in any Lease has been delivered and installed, Lessee shall promptly accept such Equipment and evidence said acceptance by executing and delivering to Lessor an acceptance certificate in the form attached hereto as Exhibit B.
(b) Lessee shall deliver to Lessor original invoices and bills of sale (if title to such Equipment has passed to Lessee) relating to each item of Equipment accepted by Lessee. With respect to Equipment not purchased through an Acquisition Fund, Lessor shall, upon receipt of an Acceptance Certificate from Lessee, prepare a Schedule of Property and Rental Payment Schedule. Lessee shall execute and deliver such Schedules to Lessor within 5 business days of receipt.
Section 5. 02. Enjoyment of Equipment. Lessor shall provide Lessee with quiet use and enjoyment of the Equipment during the Lease Term, and Lessee shall peaceably and quietly have, #765674vl (BAPCC/CA Abatement Lease Template) 8
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hold and enjoy the Equipment during the Lease Term, without suit, trouble or hindrance from Lessor, except as otherwise expressly set forth in the related Lease. Lessor shall not interfere with such quiet use and enjoyment during the Lease Term so long as Lessee is not in default under the related Lease.
Section 5. 03. Location; Inspection. Once installed, no item of the Equipment will be moved (or, in the case of moveable equipment, the base location of the Equipment will not be changed) from the location specified for it in the Lease on which such item is listed without Lessor's consent, which consent shall not be unreasonably withheld. Lessor shall have the right at all reasonable times during regular business hours to enter into and upon the property of Lessee for the purpose of inspecting the Equipment.
Section 5. 04. Use and Maintenance of the Equipment. Lessee will not install, use, operate, or maintain the Equipment improperly, carelessly, in violation of any applicable law or in a manner contrary to that contemplated by the related Lease. Lessee shall provide all permits and licenses, if any, necessary for the installation and operation of the Equipment. In addition, Lessee agrees to comply in all respects with all applicable laws, regulations and rulings of any legislative, executive, administrative, or judicial body; provided that Lessee may contest in good faith the validity or application of any such law, regulation or ruling in any reasonable manner that does not, in the opinion of Lessor, adversely affect the interest (including the reversionary interest) of Lessor in and to the Equipment or its interest or rights under the Lease.
Lessee agrees that it will maintain, preserve, and keep the Equipment in good repair and working order, in accordance with manufacturer's recommendations. Lessor shall have no responsibility to maintain, repair or make improvements or additions to the Equipment. If commercially available, Lessee will maintain in force a standard maintenance contract with the manufacturer of the Equipment, and upon request will provide Lessor with a copy of that contract. Upon the prior written consent of Lessor, which consent shall not be unreasonably withheld, Lessee may use another third party maintenance provider provided the maintenance contract between Lessee and such third party requires the third party to maintain the Equipment at the manufacturer's then current release, revision and engineering change levels, including hardware, software enhancements and microcode levels. In all cases, Lessee agrees to pay any costs necessary for the manufacturer to re-certify the Equipment as eligible for manufacturer's maintenance upon the return of the Equipment to Lessor as provided for herein.
Lessee shall not alter any item of Equipment or install any accessory, equipment or device on an item of Equipment if that would impair any applicable warranty, the originally intended function or the value of that Equipment. All repairs, parts, accessories, equipment and devices furnished, affixed to or installed on any Equipment, excluding temporary replacements, shall thereupon become subject to the interest of Lessor therein.
ARTICLE VI
Section 6.01. Title to the Equipment. During each Lease Term, and so long as Lessee is not in default under Article XII hereof, all right, title and interest in and to each item of the Equipment shall be vested in Lessor as security for the obligations of Lessee hereunder. Lessee shall at all times protect and defend, at its own cost and expense, Lessor's title in and to the #765674vl (BAPCC/CA Abatement Lease Template) 9
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Equipment from and against all claims, liens and legal processes of its creditors, and keep all Equipment free and clear of all such claims, liens and processes. Upon purchase of the Equipment under a Lease by Lessee pursuant to Section 10.01, Lessor shall transfer to Lessee title to the Equipment, as-is, without warranty of any kind other than as to the absence of liens created by or through Lessor, and shall execute and deliver to Lessee such documents as Lessee may reasonably request to evidence the transfer of Lessor's title and interest in the Equipment subject to the related Lease.
Section 6. 02. Security Interest. As additional security for the payment of all of Lessee's obligations under each Lease, upon the execution of such Lease, Lessee grants to Lessor a security interest constituting a first lien on (a) the Equipment applicable to such Lease, (b) moneys and investments held from time to time in the Acquisition Fund and ( c) any and all proceeds of any of the foregoing. Lessee agrees to execute and authorizes Lessor to file such notices of assignment, chattel mortgages, financing statements and other documents, in form satisfactory to Lessor, which Lessor deems necessary or appropriate to establish and maintain Lessor's security interest in the Equipment, the Acquisition Fund and the proceeds thereof.
Section 6. 03. Personal Property. The Equipment is and will remain personal property and will not be deemed to be affixed to or a part of the real estate on which it may be situated, notwithstanding that the Equipment or any part thereof may be or hereafter become in any manner physically affixed or attached to real estate or any building thereon. Upon the request of Lessor, Lessee will, at Lessee's expense, furnish a waiver of any interest in the Equipment from any party having an interest in any such real estate or building.
ARTICLE VII
Section 7.01. Liens, Taxes, Other Governmental Charges and Utility Charges. Lessee shall keep the Equipment free of all levies, liens, and encumbrances except those created by each Lease. The parties to this Agreement contemplate that the Equipment will be used for a governmental or proprietary purpose of Lessee and that the Equipment will therefore be exempt from all property taxes. If the use, possession or acquisition of any Equipment is nevertheless determined to be subject to taxation, Lessee shall pay when due all taxes and governmental charges lawfully assessed or levied against or with respect to such Equipment. Lessee shall pay all utility and other charges incurred in the use and maintenance of the Equipment. Lessee shall pay such taxes or charges as the same may become due; provided that, with respect to any such taxes or charges that may lawfully be paid in installments over a period of years, Lessee shall be obligated to pay only such installments as accrue during each Lease Term.
Section 7.02. Insurance . Lessee shall during each Lease Term maintain or cause to be maintained (a) casualty insurance naming Lessor and its assigns as additional insured and loss payee and insuring the Equipment against loss or damage by fire and all other risks covered by the standard extended coverage endorsement then in use in the State, and any other risks reasonably required by Lessor, in an amount at least equal to the then applicable Purchase Price of the Equipment; (b) liability insurance that protects Lessor from liability in all events in form and amount satisfactory to Lessor; ( c) worker's compensation coverage as required by the laws of the State, and ( d) rental interruption insurance in an amount which shall cover Rental Payments for no less than 24 months; provided that, with Lessor's prior written consent, Lessee may self- #765674vl (BAPCC/CA Abatement Lease Template) 10
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insure against the risks described in clause (a). Lessee shall furnish to Lessor evidence of such insurance or self-insurance coverage throughout each Lease Term. Lessee shall not cancel or modify such insurance or self-insurance coverage in any way that would affect the interests of Lessor without first giving written notice thereof to Lessor at least 30 days in advance of such cancellation or modification.
Section 7.03. Advances. In the event Lessee shall fail to keep the Equipment in good repair and working order, Lessor may, but shall be under no obligation to, maintain and repair the Equipment and pay the cost thereof. All amounts so advanced by Lessor shall constitute additional rent for the Lease Term and Lessee covenants and agrees to pay such amounts so advanced by Lessor with interest thereon from the due date until paid at the rate of 12% per annum or the maximum amount permitted by law, whichever is less.
ARTICLE VIII
Section 8.01. Damage, Destruction and Condemnation. Unless Lessee shall have exercised its option to purchase the Equipment by making payment of the Purchase Price as provided in the related Lease, if, prior to the termination of the applicable Lease Term, (a) the Equipment or any portion thereof is destroyed, in whole or in part, or is damaged by fire or other casualty or (b) title to, or the temporary use of, the Equipment or any part thereof shall be taken under the exercise or threat of the power of eminent domain by any governmental body or by any person, firm or corporation acting pursuant to governmental authority, Lessee and Lessor will cause the Net Proceeds of any insurance claim or condemnation award or sale under threat of condemnation to be applied to the prompt replacement, repair, restoration, modification or improvement of the Equipment. Any balance of the Net Proceeds remaining after such work has been completed shall be paid to Lessee.
If Lessee elects to replace any item of the Equipment (the "Replaced Equipment ") pursuant to this Section, the replacement equipment (the "Replacement Equipment ") shall be of similar type, utility and condition to the Replaced Equipment and shall be of equal or greater value than the Replaced Equipment. Lessee shall represent, warrant and covenant to Lessor that each item of Replacement Equipment is free and clear of all claims, liens, security interests and encumbrances, excepting only those liens created by or through Lessor, and shall provide to Lessor any and all documents as Lessor may reasonably request in connection with the replacement, including, but not limited to, documentation in form and substance satisfactory to Lessor evidencing Lessor's title in the Replacement Equipment. Lessor and Lessee hereby acknowledge and agree that any Replacement Equipment acquired pursuant to this paragraph shall constitute "Equipment" for purposes of this Master Equipment Lease and the related Lease.
Lessee shall complete the documentation of Replacement Equipment on or before the next Rent Payment date after the occurrence of a casualty event, or be required to exercise the Purchase Option with respect to the damaged equipment.
For purposes of this Article, the term "Net Proceeds" shall mean the amount remaining from the gross proceeds of any insurance claim or condemnation award or sale under threat of condemnation after deducting all expenses, including attorneys' fees, incurred in the collection thereof.
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Section 8. 02. Insufficiency of Net Proceeds. If the Net Proceeds are insufficient to pay in full the cost of any repair, restoration, modification or improvement referred to in Section 8.01, Lessee shall either (a) complete such replacement, repair, restoration, modification or improvement and pay any costs thereof in excess of the amount of the Net Proceeds, or (b) pay or cause to be paid to Lessor the amount of the then applicable Purchase Price for the Equipment, and, upon such payment, the applicable Lease Term shall terminate and Lessor's interest in the Equipment shall terminate as provided in Article VI hereof. The amount of the Net Proceeds, if any, remaining after completing such repair, restoration, modification or improvement or after purchasing such Equipment and such other Equipment shall be retained by Lessee. If Lessee shall make any payments pursuant to this Section, Lessee shall not be entitled to any reimbursement therefor from Lessor nor shall Lessee be entitled to any diminution of the amounts payable under Article IV.
Notwithstanding anything to the contrary herein, Lessee's obligations under Article VIIl shall be limited to the Net Proceeds of insurance or condemnation and other legally available funds and is subject in all respects to the provisions of Section 3.03 hereof. If Lessee's obligations under Section 7.02 to maintain property insurance is covered by self insurance, then Lessee hereby certifies that its self insurance program guarantees payment of the interest of Lessor for any loss or damage to the Equipment leased hereunder.
ARTICLE IX
Section 9.01. Disclaimer of Warranties. Lessor makes no warranty or representation, either express or implied, as to the value, design, condition, merchantability or fitness for particular purpose or fitness for use of the Equipment, or any other warranty or representation, express or implied, with respect thereto and, as to Lessor, Lessee's acquisition of the Equipment shall be on an "as is" basis. In no event shall Lessor be liable for any incidental, indirect, special or consequential damage in connection with or arising out of this Master Equipment Lease, any Lease, the Equipment or the existence, furnishing, functioning or Lessee's use of any item, product or service provided for in this Agreement or any Lease.
Section 9. 02. Vendor's Warranties. Lessor hereby irrevocably appoints Lessee its agent and attorney-in-fact during each Lease Term, so long as Lessee shall not be in default under the related Lease, to assert from time to time whatever claims and rights (including without limitation warranties) relating to the Equipment that Lessor may have against Vendor. Lessee's sole remedy for the breach of such warranty, indemnification or representation shall be against Vendor of the Equipment, and not against Lessor. Any such matter shall not have any effect whatsoever on the rights of Lessor with respect to any Lease, including the right to receive full and timely payments under a Lease. Lessee expressly acknowledges that Lessor makes, and has made, no representations or warranties whatsoever as to the existence or the availability of such warranties by Lessor of the Equipment.
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ARTICLEX
Section I 0. O 1. Purchase Option. Lessee shall have the option to purchase all of the Equipment listed in a Lease, upon giving written notice to Lessor at least 30, but not more than 120, days before the date of purchase , at the following times and upon the following terms:
(a) After 50% of the Lease Term has transpired (such date is referred to as the "Purchase Option Commencement Date"), on any Rental Payment dates subsequent thereto , upon payment in full to Lessor of the Rental Payments then due under such Lease, subject to a prepayment premium of 2% of the then outstanding principal balance of the Lease, any and all accrued interest; or
(b) In the event of substantial damage to or destruction or condemnation of substantially all of the Equipment listed in a Lease, on the day specified in Lessee's notice to Lessor of its exercise of the purchase option upon payment in full to Lessor of the Rental Payments then due under such Lease plus the then applicable Purchase Price; or (c) Upon the expiration of the Lease Term, upon payment in full of all Rental Payments then due and all other amounts then owing under the Lease, and the payment of $1.00 to Lessor.
After payment of the applicable Purchase Price, Lessee will own the related Equipment, and Lessor's right, title and interests in and to such Equipment will be transferred and terminated in accordance with Section 6.01.
ARTICLE XI
Section JI.OJ. Assignment by Lessor. Lessor's right, title and interest in and to Rental Payments and any other amounts payable by Lessee under any and all of the Leases , its interest in the Equipment subject to each such Lease, and all proceeds therefrom may be assigned and reassigned in whole or in part to one or more assignees or subassignees by Lessor, without the necessity of obtaining the consent of Lessee; provided, however, that any such assignmen t, transfer or conveyance whether to a trustee for the benefit of owners of certificates of participation or otherwise shall be made in a manner that conforms to any applicable State or federal law. Nothing in this Section 11.01 shall be construed, however, to prevent Lessor from executing any such assignment, transfer or conveyance that does not involve funding through the use of certificates of participation within the meaning of applicable State law, including any such assignment, transfer or conveyance as part of a multiple asset pool to a partnership or trust, interests in which are offered and sold in a private placement or limited offering only to investors whom Lessor reasonably believes are qualified institutional buyers or accredited investors within the meaning of the applicable federal securities law; provided further , however, that in any event, Lessee shall not be required to make Rental Payments , to send notices or to otherwise deal with respect to matters arising under a Lease with or to more than one individual or entity. No assignment, transfer or conveyance permitted by this Section 11.01 shall be effective until Lessee shall have received a written notice of assignment that discloses the name and address of each such assignee; provided, however, that if such assignment is made to a bank or trust company as trustee or paying agent for owners of certificates of participation , trust certificates or partnership #765674vl (BAPCC/CA Abatement Lease Template) 13
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interests with respect to the Rental Payments payable under a Lease, it shall thereafter be sufficient that Lessee receives notice of the name and address of the bank or trust company as trustee or paying agent. During the term of each Lease, Lessee shall keep, or cause to be kept, a complete and accurate record of all such assignments in form necessary to comply with Section 149 of the Code. Lessee shall retain all such notices as a register of all assignees and shall make all payments to the assignee or assignees designated in such register. Lessee shall not have the right to and shall not assert against any assignee any claim, counterclaim or other right Lessee may have against Lessor or the Vendor. Assignments in part may include without limitation assignment of all of Lessor's interest in and to the Equipment listed in a particular Lease and all rights in, to and under the Lease related to such Equipment. The option granted in this Section may be separately exercised from time to time with respect to the Equipment listed in each Lease, but such option does not permit the assignment of less than all of Lessor's interests in the Equipment listed in a single Lease.
Section 11.02. Assignment and Subleasing by Lessee. None of Lessee's right, title, and interest in, to and under any Lease or any portion of the Equipment may be assigned or encum bered by Lessee for any reason.
ARTICLE XII
Section 12. 0 I. Events of Default Defined. Any of the following events shall constitute an "Event of Default" under a Lease:
(a) Failure by Lessee to pay any Rental Payment or other payment required to be paid under any Lease at the time specified herein;
(b) Failure by Lessee to observe and perform any covenant, condition or agreement on its part to be observed or performed, other than as referred to in subparagraph (a) above, for a period of 30 days after written notice specifying such failure and requesting that it be remedied is given to Lessee by Lessor, unless Lessor shall agree in writing to an extension of such time prior to its expiration; provided that, if the failure stated in the notice cannot be corrected within the applicable period, Lessor will not unreasonably withhold its consent to an extension of such time if corrective action is instituted by Lessee within the applicable period and diligently pursued until the default is corrected;
( c) Any statement, representation or warranty made by Lessee in or pursuant to any Lease or its execution, delivery or performance shall prove to have been false, incorrect, misleading, or breached in any material respect on the date when made; (d) Any default occurs under any other agreement for borrowing money or receiving credit equal to or greater than $500,000.00 under which Lessee may be obligated as borrower, if such default consists of (i) the failure to pay any indebtedness when due or (ii) the failure to perform any other obligation thereunder and gives the holder of the indebtedness the right to accelerate the indebtedness;
(e) Lessee shall (i) apply for or consent to the appointment of a receiver, trustee, custodian or liquidator of Lessee, or of all or a substantial part of the assets of Lessee, (ii) be #765674vl (BAPCC/CA Abatement Lease Template) 14
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unable, fail or admit in writing its inability generally to pay its debts as they become due, (iii) make a general assignment for the benefit of creditors, (iv) have an order for relief entere d against it under applicable federal bankruptcy law, or (v) file a voluntary petition in bankruptcy or a petition or an answer seeking reorganization or an arrangement with creditors or taking advantag e of any insolvency law or any answer admitting the material allegations of a petition filed against Lessee in any bankruptcy, reorganization or insolvency proceeding; or (f) An order, judgment or decree shall be entered by any court of competen t jurisdiction, approving a petition or appointing a receiver, trustee, custodian or liquidator or Lessee or of all or a substantial part of the assets of Lessee, in each case without its application , approval or consent, and such order, judgment or decree shall continue unstayed and in effect for any period of 30 consecutive days.
Section I 2. 02. Remedies on Default. Whenever any Event of Default exists, Lessor shall have the right, at its sole option without any further demand or notice, to take one or any combination of the following remedial steps:
(a) By written notice to Lessee, Lessor may without terminating such Lease, collect each Rental Payment payable by Lessee pursuant to such Lease and other amounts payable by Lessee under such Lease as they become due and payable; (b) With or without terminating the Lease Term under such Lease, Lessor may enter the premises where the Equipment listed in such Lease is located and retake possession of such Equipment or require Lessee at Lessee's expense to promptly return any or all of such Equipment to the possession of Lessor at such place within the United States as Lessor shall specify, and sell or lease such Equipment or, for the account of Lessee, sublease such Equipment, continuing to hold Lessee liable, but solely from legally available funds, for the difference between (i) the Rental Payments payable by Lessee pursuant to such Lease and other amounts related to such Lease or the Equipment listed therein that are payable by Lessee to the end of the Lease Term, and (ii) the net proceeds of any such sale, leasing or subleasing (after deducting all expenses of Lessor in exercising its remedies under such Lease, including without limitation all expenses of taking possession, storing, reconditioning and selling or leasing such Equipment and all brokerage, auctioneer's and attorney's fees), subject, however, to the provisions of Section 3.03.
The exercise of any such remedies respecting any such Event of Default shall not relieve Lessee of any other liabilities under any other Lease or the Equipment listed therein ; ( c) Lessor may take whatever action at law or in equity may appear neces sary or desirable to enforce its rights under such Lease or as a secured party in any or all of the Equipment subject to such Lease; and
(d) by action pursuant to the California Code of Civil Procedure, or as otherwise provided by law, obtain the issuance of a writ of mandamus enforcing, for the entire balance of the remaining Lease Term, the duty of Lessee to appropriate and take all other administrative steps necessary for the payment of rents, and other amounts due hereunder.
Section 12.03. No Remedy Exclusive. No remedy herein conferred upon or reserved to Lessor is intended to be exclusive and every such remedy shall be cumulative and shall be in addition to every other remedy given under a Lease now or hereafter existing at law or in equity, #765674vl (BAPCC/CA Abatement Lease Template) 15
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provided that Lessor shall have no right to accelerate any Rental Payment or otherwise declare any Rental Payment or other amount payable not then in default to be immediately due and payable. No delay or omission to exercise any right or power accruing upon any default shall impair any such right or power or shall be construed to be a waiver thereof, but any such right or power may be exercised from time to time and as often as may be deemed expedient. In order to entitle Lessor to exercise any remedy reserved to it in this Article it shall not be necessary to give any notice other than such notice as may be required in this Article.
Section 12. 04. Application of Moneys. Any net proceeds from the exercise of any remedy under this Agreement, including the application specified in Section 12.02(b)(ii) (after deducting all expenses of Lessor in exercising such remedies including without limitation all expenses of taking possession, storing, reconditioning and selling or leasing Equipment and all brokerage, auctioneer's or attorney's fees), shall be applied as follows:
(a) If such remedy is exercised solely with respect to a single Lease, Equipment listed in such Lease or rights thereunder, then to amounts due pursuant to such Lease and other amounts related to such Lease or such Equipment.
(b) If such remedy is exercised with respect to more than one Lease, Equipment listed in more than one Lease or rights under more than one Lease, then to amounts due pursuant to such Leases pro rata.
ARTICLE XIII
Section 13.01. Notices. All notices, certificates or other communications under any Lease shall be sufficiently given and shall be deemed given when delivered or mailed by registered mail, postage prepaid, or delivered by overnight courier, or sent by facsimile transmission (with electronic confirmation) to the parties hereto at the addresses immediately after the signatures to this Agreement ( or at such other address as either party hereto shall designate in writing to the other for notices to such party) and to any assignee at its address as it appears on the registration books maintained by Lessee.
Section 13. 02. Release and Indemnification. To the extent permitted by law, but only from legally available funds, Lessee shall indemnify, protect, hold harmless, save and keep harmless Lessor from and against any and all liability, obligation, loss, claim, tax and damage whatsoever, regardless of cause thereof, and all expenses in connection therewith (including, without limitation, counsel fees and expenses, penalties connected therewith imposed on interest received) arising out of or as a result of (a) the entering into of this Agreement or any Lease, (b) the ownership of any item of the Equipment, ( c) the ordering, acquisition, use, operation, condition, purchase, delivery, rejection, storage or return of any item of the Equipment, (d) any accident in connection with the operation, use, condition, possession, storage or return of any item of the Equipment resulting in damage to property or injury to or death to any person, and/or ( e) the breach of any covenant in a Lease or any material misrepresentation contained in a Lease.
The indemnification arising under this paragraph shall continue in full force and effect notwithstanding the full payment of all obligations under all Leases or the termination of the Lease Term under all Leases for any reason.
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Section 13. 03. Binding Effect. Each Lease shall inure to the benefit of and shall be binding upon Lessor and Lessee and their respective successors and assigns.
Section 13. 04. Severability. In the event any provision of any Lease shall be held invalid or unenforceable by any court of competent jurisdiction, such holding shall not invalidate or render unenforceable any other provision hereof.
Section 13.05. Amendments, Changes and Modifications. Each Lease may only be amended by Lessor and Lessee in writing.
Section 13. 06. Execution in Counterparts. Each Lease may be simultaneously executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.
Section 13. 07. Applicable Law. Each Lease shall be governed by and construed m accordance with the laws of the State.
Section 13.08. Captions. The captions or headings in this Agreement and in each Lease are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Agreement or any Lease.
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IN WITNESS WHEREOF, Lessor and Lessee have caused this Agreement to be executed in their names by their duly authorized representatives as of the date first above written .
LESSOR:
Banc of America Public Capital Corp
555 California Street, 4th Floor
San Francisco, California 94104
By ______________ _
Title _ ___________ _ _
#76 5674vl (BAPCC/CA Abatement Lease Template) 18
LESSEE:
City of Salinas
200 Lincoln A venue
Salinas, California 93901
~itle ~
(Seal)
Attest:
By _ ~ ~~~---r--+-,r-------~
Title 6, ---='-F-'~'---' =,.L-,'--'-....<--1.--------
434
ARBITRAGE AND TAX CERTIFICATE
(Non Escrow Transaction)
We, the undersigned of the City of Salinas (the "Issuer") do hereby certify that this Certificate is issued pursuant to Sections 1.141-1 through 1.141-16, 1.148-0 through 1.148-11,
1.150-1 and 1.150-2 of the Treasury Regulations (the "Regulations") promulgated pursuant to the Internal Revenue Code of 1986, as amended (the "Code"), to set forth the Issuer's reasonable expectations on the date of issue of the obligations of the Issuer under that certain Lease/Purchase Agreement (as hereinafter defined) and as to future events regarding the amount and use of the proceeds thereof.
The Lease/Purchase Agreement
1. Each of the undersigned is charged, together with other officials and officers, with the responsibility for entering into the $969,759.00 Schedule of Property No. 1, dated as of August 15, 2012 (the "Schedule") between the Issuer and Banc of America Public Capital Corp, (the "Lessor"), which Schedule incorporates by reference the terms of that certain Master Equipment Lease/Purchase Agreement, dated as of June 1, 2012 (the "Master Lease") by and between the Issuer and Banc of America Public Capital Corp (the Schedule and the Master Lease are collectively referred to herein as the "Lease/Purchase Agreement"). The Lease/Purchase Agreement is authorized pursuant to the laws of the State of California and a resolution adopted · by the Issuer on a~, /~, r2:0I ;2. (the "Resolution"). This certificate shall constitute a / I
document related to the Lease/Purchase Agreement.
2. The Lease/Purchase Agreement is being entered into to finance the cost of certain Equipment described in the Lease/Purchase Agreement. As contemplated by the Lease/Purchase Agreement, the Lessor will fund the Equipment Cost to the vendors thereof and will lease the Equipment back to the Issuer, and the Issuer will agree to make rental payments under the Lease/Purchase Agreement (the "Rental Payments") to the Lessor. The Equipment will be used for a corporate and public purpose of the Issuer.
Proceeds
3. The Issuer will receive from the Lessor as a result of the financing of the Equipment as contemplated by the Lease/Purchase Agreement $969,759.00 (the "Equipment Proceeds"). The Equipment Proceeds shall be immediately used for the acquisition of the Equipment or to reimburse the Issuer for the cost of purchasing the Equipment, which purchase did not occur more than sixty (60) days prior to the adoption of the Resolution by Issuer. No investment of the Equipment Proceeds is expected.
4. The total cost of the Equipment is anticipated to be equal to the Equipment Proceeds. It is not anticipated that any proceeds from the issue will be used to pay the expenses of issuing the Lease/Purchase Agreement obligations.
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Equipment
5. The Equipment Proceeds and anticipated investment earnings on such proceeds do not exceed the amount necessary to complete the acquisition of the Equipment.
6. The Issuer represents that the Equipment will not be used in such a manner so as to cause the Lease/Purchase Agreement to constitute "private activity bonds" as defined in Section 141 ( a) of the Code and Sections 1.141-0 through 1.141-16 of the Regulations.
7. All Equipment financed by the Lease/Purchase Agreement will be owned by the Issuer in accordance with Section 141 of the Code. The Issuer represents and covenants that while the Lease/Purchase Agreement is in effect, it will not sell, lease or otherwise dispose of any portion of the Equipment, except that a portion of the Equipment may be disposed of in the normal course such as by reason of obsolescence and normal wear and tear; without providing to the Lessor an opinion of bond counsel that such sale, lease or other disposition will not adversely affect the exclusion of the interest portion of the Rental Payments made under the Lease/Purchase Agreement from the gross income of the Lessor for federal income tax purposes.
8. The Issuer represents that no other obligations of the Issuer (1) were or will be sold within 15 days of the lease of the Equipment as contemplated by the Lease/Purchase Agreement; (2) are being sold pursuant to a plan of financing common with the sales contemplated by the Lease/Purchase Agreement; and (3) are payable from substantially the same source of funds as the Lease/Purchase Agreement.
9. For purposes of this Certificate, "yield" means yield computed by the actuarial method using a 360-day year and semi-annual compounding, resulting in a discount rate which, when used in computing the present worth of all payments of principal and interest to be paid on an obligation, produces an amount equal to the issue price, fair market value, present value or purchase price thereof, as applicable, and is determined in all respects in accordance with Section 148 of the Code and the Regulations.
10. As of the Closing Date, the Issuer expects that the purchase price of $960,000.00 is the issue price of the obligations under the Lease/Purchase Agreement to the public (excluding bond houses, brokers and other intermediaries). Based upon such price, the Issuer expects the yield on the Lease/Purchase Agreement to be computed as 3.00%.
Arbitrage Certifications
11. There are no funds or accounts established with respect to the Lease/Purchase Agreement or the Equipment. No sinking fund has been established in connection with the payment of the principal of and interest under the Lease/Purchase Agreement, and no other similar fund or reserve or replacement fund has or will be created or established, nor does the Issuer expect to create or establish such a fund. The Issuer will pay Rental Payments directly to the Lessor on the due dates thereof.
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12. The Lease/Purchase Agreement has a weighted average maturity of __ years.
As of the Closing Date, the Issuer expects that the term of the Lease/Purchase Agreement is not longer than reasonably necessary for the governmental purpose of the Lease/Purchase Agreement. As of the Closing Date, the Issuer does not expect to have available amounts (within the meaning of Section 1.148-1 ( c )( 4) of the Regulations) during the period in which the Lease/Purchase Agreement is in effect.
13. The Issuer acknowledges its rebate obligations under Section 148 of the Code.
The Issuer will maintain such records as to the investments and earnings on the Equipment Proceeds as may be necessary and appropriate to determine the amount, if any, that it is required to rebate to the U.S. Treasury because the earnings on such investments exceed the amount that would have been earned if such proceeds had been invested at the yield payable as the interest portion of the Rental Payments on the Lease/Purchase Agreement. In the event that the Issuer invests any of the Equipment Proceeds or any investment proceeds in investments that have a yield in excess of 3.00%, the Issuer agrees to retain a rebate advisor to assist the Issuer in complying with Section 148 of the Code. The Issuer will make the calculations of its liability, file such reports and make any required payments at the time or times as are now or may hereafter be prescribed under Section 148 ( or a successor provision) of the Code.
14. Except as expressly permitted hereunder, the Issuer will not use any gross proceeds of the Lease/Purchase Agreement to acquire investments with a yield considered as a class higher than the yield payable as the interest portion of the Rental Payments on the Lease/Purchase Agreement or to replace funds which are used to directly or indirectly acquire investments with a yield higher than the yield payable as the interest portion of the Rental Payments on the Lease/Purchase Agreement.
15. The Lease/Purchase Agreement is not and will not be part of a transaction or series of transactions that attempts to circumvent the provisions of Section 148 of the Code or the Regulations (a) enabling the Issuer to exploit the difference between tax-exempt and taxable interest rates to gain a material financial advantage; or (b) overburdening the market for tax exempt obligations.
Miscellaneous
16. The Lease/Purchase Agreement will not be federally guaranteed within the meaning of Section l 49(b) of the Code.
17. The Issuer shall file or cause to be filed, the requisite Form 8038-G on or before the 15th day of the second month after the calendar quarter in which the Lease/Purchase Agreement is executed. The Issuer has reviewed the Form 8038-G prepared for the Lease/Purchase Agreement and all of the information contained therein is, to the best of the Issuer's knowledge, true and complete.
18. At least 85% of the net Equipment Proceeds of the Lease/Purchase Agreement will be allocated to expenditures for the Project no later than three years from the date hereof and therefore not more than 50% of the proceeds of the Lease/Purchase Agreement will be invested #765412v l (BAPCC) 3
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in nonpurpose investments (as defined in Section 148(t)(6)(A) of the Code) having a substantially guaranteed yield for four years or more.
19. The Issuer has not received notice of deficiency or other notice from the Interna l Revenue Service, the Department of Treasury or any other governmental agency or departmen t challenging or questioning in any way the status of the interest portion of the Rental Payments as being excludable from gross income for federal income tax purposes, nor has the Issuer been notified of any listing or proposed listing of it by the Internal Revenue Service as an issuer that may not enter into the type of lease/purchase transaction as contemplated here.
On the basis of the foregoing facts, estimates and circumstances in existence on the date hereof it is not expected that the proceeds of the Lease/Purchase Agreement will be used in a manner that would cause the Lease/Purchase Agreement to be "arbitrage bonds" under Section 148 of the Code and the Regulations. To the best of our knowledge and belief there are no other facts, estimates or circumstances which would materially change such expectations.
Dated this 15th day of August, 2012 the same being the date of delivery of and payment for the Lease/Purchase Agreement.
IN WITNESS WHEREOF, we have hereunto set our hands.
Name: _..:..~...:...u'!L4r ----==::::...._~LJ.-J.=...e.~:::..,;.....~J~r~ --- Title: (:1 ''3 a/lt!y,
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SCHEDULE OF PROPERTY No. 1
Re: Master Equipment Lease/Purchase Agreement, dated as of June 1, 2012, between Banc of America Public Capital Corp, as Lessor, and City of Salinas, as Lessee
1. Defined Terms. All terms used herein have the meanings ascribed to them in the above-referenced Master Equipment Lease/Purchase Agreement (the "Master Equipment Lease") .
2. Equipment. The following items of Equipment are hereby included under this Schedule of the Master Equipment Lease.
Quantity Description Location
210 Portable, XG-1 OOP, 136-870MHz, 1590 Moffett Street Immersible Radios Salinas , CA 93905
210 Featur e Package , P25 Trunk, P25 1590 Moffett Street Conv Salinas , CA 93905
210 Feature Package , P25 Encryption 1590 Moffett Street Salinas, CA 93905
210 Feature, Conv Vote Scan 1590 Moffett Street
Salinas, CA 93905
3. Payment Schedule.
(a) Rental Payments. The Rental Payments shall be in such amounts and payable on such dates as set forth in the Rental Payment Schedule attached to this Schedule as Exhibit A-1. Rental Payments shall commence on the date on which the Equipment listed in this Schedule is accepted by Lessee, as indicated in an Acceptance Certificate substantially in the form of Exhibit B to the Master Equipment Lease or the date on which sufficient moneys to purchase the Equipment are deposited for that purpose with an Acquisition Fund Custodian, whichever is earlier.
(b) Purchase Price Schedule . The Purchase Price on each Rental Payment date for the Term Estate in the Equipment listed in this Schedule shall be the amount set forth for such Rental Payment date in the "Purchase Price" column of the Rental Payment Schedule attached to this Schedule. The Purchase Price is in addition to all Rental Paym ents then due under this Schedule (including the Rental Payment shown on the same line in the Rental Payment Schedule).
4. Representations, Warranties and Covenants. Lessee hereby represents , warrants and covenants that its representations, warranties and covenants set forth in the Master Equipment Lease are true and correct as though made on the date of commencement of Rental Payments on this Schedule . Lessee further represents and warrants that no material adverse #765674vl (BAPCC/CA Abatement Lease Template) A- 1
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change in Lessee's financial condition has occurred since the date of the Master Equipment Lease.
5. The Lease. The terms and provisions of the Master Equipment Lease (other than to the extent that they relate solely to other Schedules or Equipment listed on other Schedules) are hereby incorporated into this Schedule by reference and made a part hereof
6. Acquisition Amount. The Acquisition Amount for the Equipment described in this Schedule to be paid to the Vendor or reimbursed to the Lessee is $969,759.00.
7. Lease Term. The Lease Term shall consist of sixty (60) months, ending on August 15, 2017.
8. Purchase Option Commencement Date. For purposes of Section 10.01 of the Lease, the Purchase Option Commencement Date is August 15, 2012.
Dated: August 15, 2012
LESSOR:
Banc of America Public Capital Corp
555 California Street, 4th Floor
San Francisco, California 94104
Title - -------------
LESSEE:
City of Salinas
200 Lincoln A venue
Salinas, California 93901
By ___ -+-----=---"~ 9',.,------~
Title C 1
(Seal)
Attest:
Counterpart No. __ of _ _ manually executed and serially numbered counterparts.
To the extent that this Lease constitutes chattel paper (as defined in the Uniform Commercial Code), no security interest herein may be created through the transfer or possession of any Counterpart other than Counterpart No. 1.
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EXHIBIT A-1
RENT ALP A YMENT SCHEDULE
Rental Rental Rental Interest
Payment Payment Payment Portion Principal
Number Date Amount 3.00% Portion Balance
0 8/15/2012 969,759.00
1 2/15/2013 105,155.02 14,546.39 90,608 .63 879,150.37
2 8/15/2013 105,155.02 13,187.26 91,967.76 787,182.60
3 2/15/2014 105,155.02 11,807.74 93,347.28 693,835.32
4 8/15/2014 105,155.02 10,407.53 94,747.49 599,087.83
5 2/15/2015 105,155.02 8,986.32 96,168.70 502,919 .13
6 8/15/2015 105,155.02 7,543.79 97,611.23 405,307.89
7 2/15/2016 105,155.02 6,079.62 99,075.40 306,232.49
8 8/15/2016 105,155.02 4,593.49 100,561.53 205,670.96
9 2/15/2017 105,155.02 3,085.06 102,069.96 103,601.00
10 8/15/2017 105,155.02 1,554.02 103,601.00 0.00
TOTAL 1,051,550.20 81,791.20 969,759.00
Prepayment Premium for purposes of Section 10.0l(a) is 2%.
For purposes of this Lease, "Taxable Rate, " with respect to the interest component of Rental Payments, means an annual rate of interest equal to 4.344 %.
LESSEE:
City of Salinas
~:,e~~~r
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ACCEPTANCE CERTI FICATE
Banc of America Public Capital Corp
555 California Street, 4th Floor
San Francisco, California 94104
Re: Schedule of Property No. 1, dated August 15, 2012, to Master Equipment Lease/Purchase Agreement, dated as of June 1, 2012, between Banc of America Public Capital Corp, as Lessor, and City of Salinas, as Lessee.
Ladies and Gentlemen:
In accordance with the Master Equipment Lease/Purchase Agreement (the "Agreement" ), the undersigned Lessee hereby certifies and represents to, and agrees with Lessor as follows:
1. All of the Equipment (as such term is defined in the Agreement) listed in the above-referenced Schedule of Property (the "Schedule ") has been delivered, installed and accepted on the date hereof.
2. Lessee has conducted such inspection and/or testing of the Equipment listed in the Schedule as it deems necessary and appropriate and hereby acknowledges that it accepts the Equipment for all purposes.
3. Lessee is currently maintaining the insurance coverage required by Section 7.02 of the Agreement.
4. No event or condition that constitutes, or with notice or lapse of time, or both, would constitute, an Event of Default (as defined in the Agreement) exists at the date hereof.
Date: August 15, 2012
L ESSEE:
City of Salinas
By /
Title C~
(Seal)
442
CERTIF ICATE
The undersigned, the duly elected and acting _ _____ _ _ City Clerk or Deputy of City Clerk of City of Salinas ( "Lessee ") certifies as follows:
A. The following listed persons are duly elected and acting officials of Lessee (the "Officials ") in the capacity set forth opposite their respective names below and that the facsimile signatures are true and correct as of the date hereof;
B. The Officials are duly authorized, on behalf of Lessee, to negotiate, execute and deliver the Master Equipment Lease/Purchase Agreement dated as of June 1, 2012 and the Schedule(s) thereunder and all future Schedule(s) (the "Agreements ") by and between Lessee and Banc of America Public Capital Corp and these Agreements are binding and authorized Agreements of Lessee, enforceable in all respects in accordance with their terms.
Name of Official
~ & £ lrlJ'!IA k;JC
//l;~;f/ /J.17ffc'~
~
Dated August 15, 2012
Title Signamr
( dJ /:Zary /--'l ~-4+-1--M-- -'--~
E:i«/?C~ l(a,;fr
4 (The signer of this Certificate
Agreements.)
authorized to execute the
443
City of Salinas
Office ofthe City Attorney - 200 Lincoln Avenue, Salinas, California 93901 - (831) 758-7256 - Fax (831) 758-7257 Vanessa W. Vallarta, City Attorney
Christopher A. Callihan, Asst. City Attorney
August 14, 2012
OPINION OF COUNSEL TO LESSEE
Banc of America Public Capital Corp
555 California Street, 4th Floor
San Francisco , California 94104
Re: Schedule of Property No. 1, dated August 15, 2012, to Master Equipment Lease/Purchase Agreement, dated as of June 1, 2012, between Banc of America Public Capital Corp, as Lessor, and City of Salinas, as Lessee
Ladies and Gentlemen:
As City Attorney and legal counsel to City of Salinas ( "Lessee"), I have examined (a) an executed counterpart of a certain Master Equipment Lease/Purchase Agreement, dated as of June 1, 2012, and Exhibits thereto by and between Banc of America Public Capital Corp ("Lessor") and Lessee (the "Agreement "), and an executed counterpart of Schedule of Property No. 1, dated August 15, 2012, by and between Lessor and Lessee (the "Schedule "), which, among other things, provides for the lease of certain property listed in the Schedule (the "Equipment"), (b) an executed counterpart of the resolution of Lessee which , among other things, authorize Lessee to execute the Agreement and the Schedule and ( c) such other opinions, documents and matters of law as I have deemed necessary in connection with the following opinions. The Schedule and the terms and provisions of the Agreement incorporated therein by reference together with the Rental Payment Schedule attached to the Schedule are herein referred to collectively as the "Lease". Based on the foregoing, I am of the following opinion s:
1. Lessee is a charter city and municipal corporation, duly organized and existing under the laws of the State, and is a political subdivision of a state within the meaning of Section 103( c) of the Internal Revenue Code of 1986, as amended (the "Code ") and the obligations of Lessee under the Agreement will constitute an obligation of Lessee within the meaning of Section 103( a) of the Code, notwithstanding Section 103(b) of the Code;
2. Lessee has the requisite power and authority to lease and acquire the Equipment and to execute and deliver the Lease and to perform its obligations under the Lease;
3. The Lease has been duly authorized , approved, executed and delivered by and on behalf of Lessee and the Lease is a valid and binding obligation of Lessee enforceable in accordance with its terms;
444
Banc of America Public Capital Corp
OPINION OF COUNSEL TO LESSEE
August 14, 2012
4. The authorization, approval, execution and delivery of the Lease and all other proceedings of Lessee relating to the transactions contemplated thereby have been performed in accordance with all open meeting laws, public bidding laws and all other applicable state or federal laws; and
5. There is no proceeding pending or threatened in any court or before any governmental authority or arbitration board or tribunal that, if adversely determined, would adversely affect the transactions contemplated by the Lease or the interest of Lessor or its assigns, as the case may be, in the Equipment thereunder.
All capitalized terms herein shall have the same meanings as in the Lease unless otherwise provided herein. Lessor and its successors and assigns, and any counsel rendering an opinion on the tax-exempt status of the interest components of the Rental Payments, are entitled to rely on this opinion .
Sincerely,
U.il~
VANESSA W. VALLARTA
City Attorney
\\salsvr38\DeptPvt\Legal\chrissc\Documents\LETTERS\DEPT LETTERHEADS\L-Opinion of Counsel to Lessee.Banc of America Public Capitol Corp.Master Equip. Lease-Purchase Agmt.08.13.12.doc 445
ESSENTIAL USE/SOURCE OF FUNDS CERTIFICATE
Banc of America Public Capital Corp
555 California Street, 4th Floor
San Francisco, California 94104
Re: Master Equipment Lease/Purchase Agreement dated June 1, 2012, between Banc of America Public Capital Corp ("Lessor") and City of Salinas ("Lessee ") and Schedule of Property No. 1 dated August 15, 2012 This certificate confirms and affirms that the Equipment described in the Agreement referenced above is essential to the functions of Lessee or to the services Lessee provides its citizens. Further, Lessee has an immediate need for, and expects to make immediate use of, substantially all such Equipment, which need is not temporary or expected to diminish in the foreseeable future. Such Equipment will be used by Lessee only for the purpose of performing one or more of Lessee's governmental or proprietary functions consistent with the permissible scope of its authority.
Lessee expects and anticipates adequate funds to be available for all future payments or rent due after the current budgetary period.
#765674vl (BAPCC/CA Abatement Lease Template) E-1
446
BILLING INFORMATION FORM
You will help us provide a more efficient service to you by completing the information requested below:
1. Billing Address (the location where you want Lessor to send your invoice for rent installments):
Name: CITY OF SALINAS
Attn: -""g ..c...,.c'~ /;.L..!...«--'---'-~....:.......!..a'"'--'l".---'-/~a.c....Lvz..l.<C.o _______ ____ _ Address (a): ,;200 L /l@/;v;
Address (b ):
City:
State: C l! 7
Zip Code (9 digits) : - -'-c;-=, ~c......_9t_ t?""""· .-=G'------- --- - --- Phone: (&-:~/) 75,g>-?t/~3 Fax: (g3r ) 7~8- 7~?0
(a) Use for street ~dd.ress, Post Office Box, division, attention of, e?c. (b) Use only if (a) is not sufficient.
2. Accounts Payable Supervisor:
Name: /0:; w~ / 67-ulc?r('('° 2
Telephone : ( ~5/ ) 7~r/- 7?/7
3. Sales Tax:
__ Exempt X Non-exempt (if exempt, provide exemption certificate)
4. Property Tax:
_X_ Exempt __ Non-exempt
5. Lessee's Rental Payment Method:
By Check X.
By Wire Transfer _ __ (if you elect this, we will provide you with wire transfer instruction)
By Automatic Debit (ACH) _ __ (if you elect this, please complete the attached form) -1- 447
Form8038•G Information Return for Tax-Exempt Governmental Obligations (Rev. September 2011) II>- Under Internal Revenue Code section 149(e) 0MB No. 1545-0720 ~ See separate instructions.
Department of the Treasury
Internal Revenue Service Caution : If the issue price is under $100,000, use Form 8038-GC. . . Reporting Authority If Amended Return, check here ..,.. D 1 Issuer's name 2 Issuer's employer identification number (EIN) City of Salinas 94·6000412
3a Name of person (other than issuer) with whom the IRS may communicate about this return (see instruct ions) 3b Telephone number of other person shown on 3a Matt N. Pressey 831•758-7420
4 Number and street (or P.O. box if mail is not delivered to street address) I Room/suite 5 Report number (For IRS Use Only) 200 Lincoln Avenue 131~
6 City, town, or post office, state, and ZIP code 7 Date of issue Salinas, CA 93901 8/13/2012
8 Name of issue 9 CUSIP number
2012 Salinas Equipment Lease/Purchase
10a Name and title of officer or other employee of the issuer whom the IRS may call for more information (see 10b Telephone number of officer or other instructions) employee shown on 10a
Matt N. Pressey, Finance Director
• "'s:l•••• Type of Issue {enter the issue price). See the instructions and attach schedule . 11 Education. 11
12 Health and hospital 12
13 Transportation 13
14 Public safety . 14 969,759
15 Environment (including sewage bonds) 15
16 Housing 16
17 Utilities 17
18 Other. Describe ..,.. 18
19 If obligations are TANs or RANs, check only box 19a .... D If obligations are BANs, check only box 19b .... D
20 If obligations are in the form of a lease or installment sale, check box .... D 1::r.1 •• II Description of Obligations. Complete for the entire issue for which this form is being filed . (a) Final maturity date (b) Issue price (c) Stated redempt ion (d) Weighted (e) Yield price at maturity average maturity 21 8/15/2017 $ 969,759 $ 5 vears 3 %
·~1•• 1•.1 Uses of Proceeds of Bond Issue (including underwriter s' discount) 22 Proceeds used for accrued interest 22
23 Issue price of entire issue (enter amount from line 21, column (bl) 23 969,759 24 Proceeds used for bond issuance costs (including underwriters' discount) . 24 25 Proceeds used for credit enhancement 25
26 Proceeds allocated to reasonably required reserve or replacement fund 26 27 Proceeds used to currently refund prior issues 27
28 Proceeds used to advance refund prior issues 28
29 Total (add lines 24 through 28) . 29
30 Nonrefunding proceeds of the issue (subtract line 29 from line 23 and enter amount here) 30 • :r._, ...... ,. Description of Refunded Bonds. Comolete this oart only for refundinQ bonds . 31 Enter the remaining weighted average maturity of the bonds to be currently refunded . ..,.. 5 years 32 Enter the remaining weighted average maturity of the bonds to be advance refunded . ..,.. years 33 Enter the last date on which the refunded bonds will be called (MM/DD/YYYY) ..,.. 34 Enter the date(s) the refunded bonds were issued ..,.. (MM/DDNYYY) For Paperwork Reduction Act Notice, see separate instructions. cat. No. 63773S Form 8038-G (Rev. 9-2011) 448
Form 8038-G (Rev. 9-2011) Page2
I ::r.r,; •" I Miscellaneous
35 Enter the amount of the state volume cap allocated to the issue under section 141 (b)(5) 35 36a Enter the amount of gross proceeds invested or to be invested in a guaranteed investment contract (GIC) (see instructions) 36a
b Enter the final maturity date of the GIC.,..
C Enter the name of the GIC provider.,..
37 Pooled financings : Enter the amount of the proceeds of this issue that are to be used to make loans to other governmental units . 37
38a If this issue is a loan made from the proceeds of another tax-exempt issue, check box.,.. D and enter the following information:
b Enter the date of the master pool obligation.,.. - - - ----- --------- - -- c Enter the EIN of the issuer of the master pool obligation.,._ - - - --- --- - --- - -- d Enter the name of the issuer of the master pool obligation.,._ - ------- ----- - - 39 If the issuer has designated the issue under section 265{b){3)(B)(i)(III) (small issuer exception), check box 40 If the issuer has elected to pay a penalty in lieu of arbitrage rebate, check box . . . . 41a If the issuer has identified a hedge , check here.,.. D and enter the following information :
b Name of hedge provider.,._
c Type of hedge.,.. - ----- - - ----- --- - -
d Term of hedge.,..-- - --- -------- - - - --
....
D
D
D 42 If the issuer has superint egrated the hedge, check box . . . . . . . 43 If the issuer has established written procedu res to ensure that all nonqualified bonds of this issue are remediated according to the requirements under the Code and Regulations (see instructions), check box . .,.. D 44 If the issuer has established written procedures to monitor the requirements of section 148, check box . . . 45a If some portion of the proceeds was used to reimburse expenditures, check here .,._ D and enter the amount of reimbursement . . . .,..
b Enter the date the official intent was adopted .,..
Signature
and
Consent
Paid
Preparer
Use Only
Preparer's signature
Firm's name .,.
Firm's address .,.
Date Check D if PTIN
self-emp loyed
Firm's EIN ...
Phone no.
.,.. D
Form 8038-G (Rev. 9-2011)
449
RESOLUTION NO. 20194 (N.C.S.)
A RESOLUTION OF THE SALINAS CITY COUNCIL APPROVING THE
FORM OF AND AUTHORIZING THE EXECUTION OF A MASTER
EQUIPMENTLEASE~URCHASEAGREEMENTWITHBANCOF
AMERICA PUBLIC CAPITAL CORPORATION, AND AUTHORIZING
PURSUANT THERETO THE ACQUISITION OF PUBLIC SAFETY
RADIOS AND RELATED EQUIPMENT AND APPROVING CERTAIN
ACTIONS IN CONNECTION THEREWITH
WHEREAS, the City of Salinas (the "City") is a chartered city (a public body, corporate and politic) duly created, established and authorized to transact business and exercise its powers, all under and pursuant to the City Charter and the Constitution and laws of the State of California; and
\YHEREAS, the City of Salinas has worked in partnersl-.ii.p witi1i the County of Monterey, and other local governmental agencies in Monterey County to establish a state of the art public safety, and first responder radio communications network; and WHEREAS, a funding agreement with the participating entities was approved by City Council on March 24, 2009 and signed by the Mayor; and
WHEREAS, during a competitive bid process the negotiations team has worked with the selected vendor, Harris Corporation, to deliver substantial discounts including a discount for a minimum aggregate purchase of subscriber radios; and
WHEREAS, a funding addendum was approved by City Council on November 9, 2010 that committed to the purchase of subscirber radios by June 30, 2012; and WHEREAS, in order to acquire and finance the equipment, the City Council desires to enter into a Master Equipment Lease/Purchase Agreement (the "Master Lease") with Banc of America Public Capital Corporation (the "Lessor"), pursuant to which the City will be enabled to enter into individual leases of equipment ("Leases") which will allow the City to acquire , lease, and ultimately obtain full legal title to the equipment in exchange for the City's rental payments to the Lessor (the "Rental Payment"); and
WHEREAS, there has been prepared and submitted to this meeting a draft form of the Master Lease, which draft form sets forth the terms and conditions of the Leases; and WHEREAS, the City is authorized to undertake all of the above pursuant to applicable laws of the State of California; and
WHEREAS, the City now desires to authorize the execution of such Master Lease, and any and all ancillary documents relating thereto and to the performance of such acts as may be necessary or desirable to effect the execution of the Master Lease and any Leases, and the acquisition of the Equipment;
450
NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF SALINAS, as follows:
Section 1. The City hereby determines the above findings are true and correct.
Section 2. The form of Master Lease, a copy of which is on file with the City Clerk, is hereby approved, together with its exhibits. The City Manager or his written designee are each hereby authorized and directed to execute and deliver the Master Lease in the form presented at this meeting with such changes insertions and omissions as may be approved by the City Manager and City Attorney , said execution being conclusive evidence of such approva l.
Section 3. The City Manager (or his written designee) and Finance Director are hereby authorized and directed to acquire the equipment and to finance such acquisit ion pursuant to the Master Lease and to the Leases to be executed thereunder. The City Manager and Finance Director are authorized to execute such Leases from time to time as necessary , and take any and all steps necessary to obtain full legal title to the equipment as soon as practicable and in accordance with the terms of the Master Lease . The maximum cost of the equipment so financed by and leased pursuant to the Master Lease shall not exceed Three Million Dollars ($3,000,000) , the maximum applicable interest rate attributable to the interest component of lease payment shall not exceed 3% and the maximum term of any lease shall not exceed 7 years from the date of acquisition.
Section 4. The City Manager and the Finance Director of the City, acting singly, are hereby authorized and directed to execute and deliver any and all documents and instruments relating to the Master Lease and the acquisition of the Equipment, and to do and cause to be done any and all acts and things necessary or proper for carrying out the transactions conte mplated by the Master Lease and this Resolution and any related agreements, including but not limited to executio n of agreements and certificates , obtaining opinions and reports, and purchase of insurance relating to the Equipment.
Section 5. This Resolution shall take effect immediately upon its adoption.
PASSED AND ADOPTED this 15th day of May 2012 , by the following vote:
A YES:Councilmembers: Barrera , Craig , De La Rosa , Lutes , McShane, Sanchez and Mayor Donohue NOES:None
ABSENT: None
ABSTAINED:None
AITEST:
. -.,-~ .... ....,. ~ .... -.,... '
This is to certify that the foregoing is a
f ult, true, and correct co~ of
Resolution No. 2D I Y: (N.C.S.) as
- ~
regu
51r ;rred by the Salinas City Council
on • as appears of record in my
office. .-.. .- ~ .· ·
Dated ~ City ·C;erk ----w...._~
·- --~----- --~ -~ · 451
Matt Pressey
From: Matt Pressey
Sent:
To:
Wednesday, September 28, 2011 11 :45 AM
Matt Pressey
Subject: Rabobank Wire Instructions
Here are the City of Salinas wire instructions:
Bank:
Rabobank, N.A.
301 Ma in Street
Salinas, CA 93901
Account Name: City of Salinas - General Checking
Routing Number: 122238420
Account Number : 066001132
Matt N. Pressey , CPA
Finance Director
City of Salinas
831-758-7420
[email protected] .ca.us
1 452
* City of Salinas r:,
u
F1nMce DepaMtment • 200 Uncoln Avenue • Salinas, Callfomla 93901 • (831) 758-7212 August 14, 2012
Ms. Eileen Harwell
Banc of America Public Capital Corp
555 California Street, 4th Floor
San Francisco, California 94104
Subject: Master Equipment Lease/Purchase Agreement- Schedule of Property No. 1 Invoice Dear Ms. Harwell:
Please accept this letter as confirmation that the City of Salinas is not able to send Banc of America Public Capital Corp the original invoice, documenting the equipment property listed in Schedule of Property No. 1 dated June 1, 2012, reflecting the $969,759 of specific equipment purchased and financed under the Master Equipment Lease/Purchase Agreement. The original invoice must stay in the City's position as support of this purchase.
However, a copy of the original invoice is attached.
Thank you for bring this issue to my attention.
Sincerely,
~~,~~r
Matt N. Pressey, fu
Finance Director
City of Salinas
Attached: Copy of original invoice
\\salsvr38\DeptPvt\Finance\mattp\Documents\Templates\Letter-.docx.8/14/2012/12:16 PM. 453
Harris Corporation
221 Jefferson Ridge Parkway
Lynchburg, VA 24501
Federal ID#:34-0276860
Customer Pwchaiie Order
Monterey CA I
Ow Contrad NO l Cu,<omc, NO
0000000591 34316 r
aymenlT Offlls
Net 30
Bil To Adaress
Monterey County Telecommunications
1322 Natividad Road
Salinas CA 93906
United States
Notes:
Reference PO 120530-057
Item No. Description
Invoice S0#375820 (Shipment 1)
Please see attached document with itemized list
.,. r ,~ . .• ( .•. , t1··, ' .. . - ~ 1 : ~
•. -·t..1··. i . ,, ·1 \ '
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. . I
·: \ ') ) ,~r,_r . "' :
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This is a liS1 of gooo, and/or ~es rendered as of this date which were furnished e~ssty eonctittonill upon you .Js~n1 to the cOf'ltmd 10l'm$ and conditions and your receipt and acceptance of the gooos shipped °' seMCeS hereunder eonstllutH yovr as.sent to such tenns. Cl.alms for goods in van.sit shOukt be flied immedi2101y wan the delivering carrier by the Pun::h.:scr, You must Obt.Jin our authortzat.on before retuming any merehandise.
Remit Payment To: (include Invoice No., Customer No. & Our Contract No.) Mail To:
Harris Corporation
Dept 1013
PO Box 121013
Dallas TX 75312·1013
United States
Electronic Funds Transfer To:
Harris Corporation
Mellon Bank
Account# : 001-7128
Routing #: 043000261
SWIFT Code: MELNUS3P
GO GREEN I Make payments online at PAYMENTS.HARRIS.COM
Ha.rris Billing Oepl Contact
Biller.
Biller Phone Number:
A c.:wp. or 1 1~ per month of the inwice
totill wi)I be leviieO O no( paid within lne
payment term, ~ ed.
Shll> To Adclres.s (tfO:herthan Bill To)
1590 Moffett Street
Salinas. CA 93905
USA
Tucker Hoskins
434-455-9266
lnVOICe Number
S000000128
Quantity Unit Price
1.00 2,587 ,940.90
Total Amount
l
in-.oate
6/29/2012
Extended Amount
2,587 ,940.90
2,587,940.90 USO
454
POI I SOI I Part Number I 0esct1etlon I Quanti~ I Unit Price I EJttended Amount I { 4,t/6~7~(1 120530-057 375820 XP·lOOF Portable, XG-100P,136-870MHz,lmmerslble 210 2,507.40 526,554.00 120530·057 375820 XPPL48 Feature Package,P25 Trun k, P25 Conv 210 1,456 .00 305,760.00 120530-057 375820 XPPL4C Feature Package,P25 Encryption 210 486.50 102,165.00 120530-057 375820 XPPL4E Feature Conv Vote Scan 210 168.00 35,280.00 120530-057 375820 XPPL5K Feature,P25 OTAP Profile 210 185.50 38,955.00 120530-057 375820 XPPA3A Battery,LI-Polymer 210 98.00 20,580.00 120530-057 375820 XPNCSC 6" Antenna,Unlty,160-870 MHz,Heilcal 210 70.00 14,700.00 120530-057 375820 XPAE9N Speaker Mlcrophone,15 210 112.00 23,520.00 120530-057 375820 XPHC30 Case,Leather ,Full,31n Loop 222 42.00 9,324 .00 120530-0 57 375820 XPHC3L Belt Clip,Me tal 50 17.50 875.00 120530-057 375820 XPAE6G Mlcrophone,Palm,2 Wlre,Black 25 150.50 3,762.50 120530-057 375820 XPAE3Z Earphone.Lapel Microphone 222 45.50 10,101.00 120530-057 375820 XPNC8C 6" Antenna,Unity,160-870 MHz,Helical 20 70.00 1,400.00 120530-057 375820 XPPA3A Battery,LI-Polymer 30 98.00 2,940 .00 120530-057 375820 XPCH4A Charger,1-Bay,Unity Portable 230 98.00 22,540.00 120530-057 375820 XPCH48 Charger, 6-Bay 16 525.00 8,400.00 120530-057 375820 XPCH4J Charger, VC4000,Unity 6 122.50 735.00 120530-0 57 375820 XPPA2H BATTERY,AA CLAMSHELL 105 35.00 3,675.00 120530-057 375820 XPHC3A Case,Leather ,Full, T ·Strap 5 42.00 210.00 120530 ·057 375820 XPHC3L Belt Clip,Metal 12 17.50 210.00 12053 0-057 375820 XPAE9N Speaker Mlcrophone,15 5 112.00 560.00 120530-057 375820 XPNC8C 6" Antenna,Unity,160 -870 MHz,Heilcal 5 70.00 350.00 120530-057 375820 XPPA3A Battery,li-Polymer 80 98.00 7,840 .00 120530-057 375820 XPCH4A Charger,1-Bay,Unlty Portable 5 98.00 490.00 120530-057 375820 XPCH4B Charger, 6-Bay 9 525.00 4,725.00 120530 ·057 375820 XPCH4J Charger,VC4000,Unlty 25 122.50 3,062.50 120530-057 375820 XPCJ3A Cable,USB,Programming 3 119.00 357.00 120530·057 375820 XP-lOOF Portabie,XG-100P,136-870MHz,lmmersib le 75 2,507.40 188,055.00 120530-057 375820 XPPL48 Feature Package,P25 Trunk, P25 Conv 75 1,456.00 109,200.00 120530-057 375820 XPPL4E Feature,Conv Vote Scan 75 168.00 12,600.00 120530-057 375820 XPPL5K Feature,P25 OTAP Profile 75 185.50 13,912.50 120530·057 375820 XPNCBC 6" Antenna,Unity,160-870 MHz.Helical 75 70.00 5,250.00 120530·057 375820 XPAE9N Speaker Mlcropho ne,IS 75 112.00 8,400.00 120530-057 375820 XPHC3A Case,Leather, Fu! I, T -Strap 75 42.00 3,150.00 120530-057 375820 XP-lOOF Portable,XG-100P,136-870MHz,lmmersible 30 2,507.40 75,222.00 120530-057 375820 XPPL4B Feature Package,P25 Trunk, P25 Conv 30 1,456.00 43,6 80.00 120530-057 375820 XPPL4C Feature Package, P25 Encryption 30 486.50 14,595 .00 120530-057 375820 XPPL4E Feature ,Conv Vote Scan 30 168.00 5,040 .00 120530-057 375820 XPPL5K Feature,P25 OTAP Profil e 30 185.50 5,565.00 120530-057 375820 XPNC8C 6' Antenna ,Unlty,160 -870 MHz.Helical 30 70.00 2,100 .00 120530-057 375820 XPAE9N Spea ker Microphone, IS 30 112 .00 3,360.00 120530-057 375820 XPHC3A Case,Leather,Full, T -Stra p 30 42.00 1,260.00 120530-057 375820 XM-100F Mobile,XG· 100M, 136-870MHz, Unencrypted 4 2,367.40 9,469.60 120530-057 375820 XMPL48 Feature Packa8e,P25 Trunk, P2S Conv 4 1,456.00 5,824.00 120530-057 375820 XMPL5K Feature,P2S OTAP Profile 4 185.50 742.00 120530-05 7 375820 XMPL4E Feature,Conv Vote Scan 4 168.00 672.00 120530-057 375820 XMPL4C Feature Packag e,P25 Encryption 4 486.50 1,946.00 120530-057 375820 XMZN8K Desktop Station ,C5-7000,Local Control 4 1,396.50 5,586.00 120530-057 375820 XMCP9H Control Unlt,CH721,System,Front Mount 4 553.00 2,212.00 120530-057 375820 XMMA6P Bracket Kit.Rack Mount,CS7000 4 112.00 448.00 120530·057 375820 XMMC7Y Microphone,Desktop 4 91.00 364.00 120530-057 375820 XMANGJ Antenna,Flex,Muiti-Band,136-870MHz OdB 4 157.50 630.00 120530-057 37582 0 XM-lOOF Mobile,XG-100M, 136-870M Hz,Unencrypted 81 2,367.40 191,759 .40 455
120530·057 375820 XMPL4B Feature Package,P25 Trunk, P25 Conv 81 1,456.00 117,936 .00 120530-057 375820 XMPL5K Featu re, P25 OTAP Profile 81 185.50 15,025 .50 120530-057 375820 XMPL4E Feature,Conv Vote Scan 81 168.00 13,608 .00 120530-057 375820 XMPL4C Feature Package ,P25 Encryption 81 486.50 39,406.50 120530·057 3758 20 XMCP9R Control Unit,CHlOO,Touch Screen,Remote 81 1,048 .60 84,936.60 120530-057 375820 XMZN9A Accessories,Unlty,CH100,Remote Mount 81 252.00 20,412.00 120530 -057 375820 XMMC72 MICROPHONE,STANDARD,CH721 CONTROL UNIT 81 56.00 4,536.00 120530-057 375820 XMCP9R Control Unlt,CHlOO,Touch Screen,Remote 6 1,048 .60 6,291.60 120530 -057 375820 XMZN9A Accessories,Unity,CHlOO,Remote Mount 6 252.00 1,512.00 120530-057 375820 XMCP9R Contr ol Unlt,CH100,Touch Screen,Remote 15 1,048 .60 15,729.00 120530-057 375820 XMZN9A Accessorles ,Unlty,CH100,Remote Mount 15 252.00 3,780.00 120530-057 375820 XM-lOOF Mobile,XG·lOOM,136-870MHz,Unencrypted 8 2,367.40 18,939.20 120530-057 375820 XMPL4B Feature Package,P25 Trunk, P25 Conv 8 1,456.00 11,648.00 120530-057 375820 XMPL5K Feature ,P25 OTAP Profile 8 185.50 1,484.00 120530-057 375820 XMPL4E Feature,Conv Vote Scan 8 168 .00 1,344.00 120530-057 375820 XMPL4C Feature Package,P25 Encryption B 486.50 3,892.00 120530-057 375820 XMCP9F Control Unit,CH721,System,Remote Mount 8 577.50 4,620.00 120530-057 375820 XMZN7R Accessories,Unlty,Remote Mount 8 252.00 2,016.00 120530-057 375820 XMMC72 MICROPHONE,STANDARD,CH721 CONTROL UNIT 8 56.00 448.00 120530-057 375820 XMAN6J Antenna ,Flex,Multl-Band ,136-870MHz OdB 8 157.50 1,260 .00 120530 -057 375820 XM-100F Mobile,XG-100M,136-870MHz ,Unencrypted 15 2,367.40 35,511.00 120530-057 375820 XMPL4B Feature Package,P25 Trunk, P25 Conv 15 1,456.00 21,840.00 120530-057 375820 XMPL5K Feature ,P25 OTAP Profile 15 185.50 2,782.50 120530-057 375820 XMPL4E Feature,Corw Vote Scan 15 168.00 2,520. 00 120530-057 375820 XMCP9R Control Unit,CH100,Touch 5creen,Remote 15 1,048.60 15,729 .00 120530-057 375820 XMZN9A Accessorles,Unlty,CHlOO,Remote Mount 15 252.00 3,780.00 120530-057 375820 XMMC9C Mlcrophone ,DTMF,CH· 721 Control Unit 15 143.50 2,152 .50 120530-057 375820 XM-lOOF Moblle,XG-lOOM,136-870MHz, Unencrypted 32 2,367.40 75,756.80 120530-057 375820 XMPL4B Feature Package,P25 Trunk, P25 Conv 32 1,456.00 46,592.00 120530-057 375820 XMPLSK Feature,P25 OTAP Profile 32 185.50 5,936.00 120530-057 375820 XMPl4E Feature,Conv Vote Scan 32 168.00 5,376.00 120530-057 375820 XMPL4C Feature Package,P25 Encryption 32 486.50 15,568.00 120530-057 375820 XMCP9R Control Unit,CHlOO,Touch Screen,Remote 32 1,048.60 33,555.20 120530-057 375820 XMZN9A Accessories,Unlty,CH100,Remote Mount 32 252.00 8,064.00 120530-057 375820 XMMC9C Microphone,DTMF,CH-721 Control Unit 32 143.50 4,592.00 120530-057 375820 XM·lOOF Mobile,XG-100M,136-870MHz,Unencrypted 10 2,367.40 23,674.00 120530-057 375820 XMPL4B Featu re Package,P25 Trunk, P25 Conv 10 1,456.00 14,560.00 120530-057 375820 XMPL5K Feature ,P25 OTAP Profile 10 185 .50 1,855.00 120530-057 3758 20 XMPL4E Feature ,Conv Vote Scan 10 168 .00 1,68 0.00 120530-057 375820 XMPL4C Feature Package,P25 Encryption 10 486.50 4,865 .00 120530-057 375820 XMCP9H Control Unit,CH721,System,Front Mount 10 553.00 5,530 .00 120530-057 375820 CA-009562-030 Cable Assembly,CAN,30 ft Straight-Right 13 80.50 1,046.50 120530-057 375820 FM-017262 -001 D-Sw1vel,P5300/PS400/P7300 6 7.00 42.00 120530·057 375820 19A703965P2 Fllter,RF Interference 8 168.00 1,344 .00 120530-057 375820 198802554P24 Cable,Mcycle Ace 8 119.00 952.00 120530-057 375820 CA-012349-002 Cable,Motorcyc le Accessory,M7300 8 73.50 588.00 120530-057 375820 l88D6556G1 Klt,Microphone Hanger 8 42.00 336.00 120530 -057 375820 CM-022218·AE5102 Software,VIP App w/AES Encry 2 7,704.00 15,408.00 120530-057 375820 CA-009562-030 Cable Assembly,CAN,30 ft Straight-Right 4 80.50 322.00 120530-057 375820 CA-012349-001 Cable,Options,M7300/5300 11 133.00 1,463.00 120530-057 375820 XMMC7Y Mlcrophone,Desktop 3 91.00 273.00 120530-057 375820 XMZNBK Desktop Station,CS-7000,Local Control 3 1,396 .50 4,189.50 120530-057 375820 XMMA6P Bracket Kit,Rack Mount,CS7000 10 112.00 1,120.00 TOTAL 2,587,940.9 0
456
Harris Corporation PSPC
221 Jefferson Ridge Parkway
Lynchburg, VA 24501
Federa l ID#:34-0276860
Monterey CA I
Our Con*JaQ N<J I Cu.stom.r No
000000059 1 34396
CustOffle,;' Purcnase Order
Bill To Address
Monterey County Telecommunications
1322 Natividad Road
Salinas. CA 93906
Notes:
ttemNo. Description
Trade in Allowance Credit (SO# 375820)
r
oymen\ 1 erms
Net30
Remit Payment To: 0nclude Invoice No., Customer No. & Our Contract No.) Mail To:
Harris Corporation PSPC
8058
PO Box7247
Philadelphia PA 19170-8058
United States
Electronic Funds Transfer To:
Harris Corporation PSPC
CitiBank - PSPC
Account# : 30886623
SWIFT Code: CITIUS33
GO GREEN! Make payments on line at PAYMENTS.HARRIS.COM
Harris Billing Dept. Contact
Biller:
Bille r Phone Numbe r:
A charge of 1 112% per month of the invoice
total win be k:vied if not paid withtn the
payment terms indic..lted.
Ship To Address (11 other than BieTo)
1590 Moffett Street
Salinas, CA 93905
USA
Tucker Hoskins
43+455-9266
Invoice NIJfflbef
S000000158
Quantity UnN: Price
1.00 -186.000.00
I
1nvo1ce O.rte
7/26/2012
Extended Amount
-186.000 .00
PLEASE REVIEW THE REMIT TO ADDRESS LISTED ON THIS INVOICE
PLEASE ENSURE YOUR RECORDS AGREE TO AVOID PAYMENT DELAY Taxes (SO# 375820)
This is a llSt of goods atld/ot s@r'Vices rendered ai of lhi.5 date which were furnished express~ conditional upon y01J assen! to the contract terms and condltlons a.tld your receipt and acceptance of the goods shipped or services be re under constitutes your assent to such term,. Claims for goods lntran.sil: .should be filed immediatetywith the delivering carrier by the Purchaser. You must obtain our authorization before returning any merchandise. 186,150.52
Total Amount 150.52 USD
457
SCHEDULE OF PROPERTY NO. 4
Re: Master Equipment Lease/Purchase Agreement, dated as of June 1, 2012, between Banc of America Public Capital Corp, as Lessor, and City of Salinas, as Lessee
1. Subject to Appropriation Schedule of Property. The parties intend this Schedule to be structured as an annual appropriation lease obligation, rather than an abatement lease obligation.
To accomplish this, the above -referenced Master Equipment Lease/Purchase Agreement (the “Master Equipment Lease”), shall be deemed amended solely for the purposes of this Schedule, as follows:
A. The following changes are hereby made to Section 1.01 of the Master Equipment Lease:
(i) The following shall be inserted in lieu of the definition for “Lease Term:” “Lease Term” means the Scheduled Term upon its expiration or as terminated as provided in Section 3.03.
(ii) The dollar amount in the definition of “Maximum Equipment Cost” shall be changed from $3,000,000.00 to $9,500,000.00.
(iii) The following shall be inserted in lieu of the definition for “Acquisition Fund” and all references in the Master Equipment Lease to “Acquisition Fund” shall be replaced with “Escrow Account:”
“Escrow Account” means the fund established and held by the Escrow Agent pursuant to the Escrow Agreement.
(iv) The following shall be inserted in lieu of the definition for “Acquisition Fund Agreement” and all references in the Master Equipment Lease to “Acquisition Fund Agreement” shall be replaced with “Escrow Agreement:”
“Escrow Agreement” means the Escrow and Account Control Agreement in form and substance acceptable to and executed by Lessee, Lessor and the Escrow Agent, pursuant to which an Escrow Account is established and administered.
(v) The following shall be inserted in lieu of the definition for “Acquisition Fund Custodian” and all references in the Master Equipment Lease to “Acquisition Fund Custodian” shall be replaced with “Escrow Agent:”
“Escrow Agent” means the Escrow Agent identified in the Escrow Agreement, and its successors and assigns.
(vi) The following definitions shall be inserted alphabetically in Section 1.01:
458
“Acquisition Period” means, with respect to each Lease for which an Escrow Account is established, that period identified in the related Schedule during which the Lease Proceeds attributable to such Lease may be expended on Equipment Costs pursuant to the related Escrow Agreement.
“Original Term” means the period from the Commencement Date u ntil the end of the fiscal year of Lessee in effect at such Commencement Date “Renewal Terms” means the consecutive renewal terms of this Agreement, the first of which commences immediately after the end of the Original Term and each having a duration and term coextensive with each successive fiscal year of Lessee; provided that the final such renewal term shall commence on the first day of the last such fiscal year and end on the first business day after the last scheduled Rental Payment Date.
“Scheduled Term” means the Original Term and all Renewal Terms, with a final Renewal Term ending on December 2, 2032.
(vii) The following definition shall be deleted from Section 1.01:
“Utilization Period” means the date by which Lessee must deliver an Acceptance Certificate for the Equipment under such Lease as indicated in Section 3.05(b). “Vendor Agreement” means any contract entered into by Lessee and any Vendor for the acquisition, installation, maintenance and/or servicing of the Equipment under a Lease.
B. The following shall be added to the end of Section 3.01 of the Master Equipment Lease:
The Lease Term may be continued, solely at the option of Lessee, at the end of the Original Term or any Renewal Term for the next succeeding Renewal Term up to the maxi mum Lease Term as set forth in the Rental Payment Schedule. At the end of the Original Term and at the end of each Renewal Term until the maximum Lease Term has been completed, Lessee shall be deemed to have exercised its option to continue this Agreement for the next Renewal Term unless Lessee shall have terminated this Agreement pursuant to Section 3.03 or Section 10.01. The terms and conditions during any Renewal Term shall be the same as the terms and conditions during the Original Term, except that t he Rental Payments shall be as provided in the Rental Payment Schedule.
C. The following shall be inserted in lieu of Section 3.02 of the Master Equipment Lease:
Section 3.02. Continuation of Lease Term . Lessee intends, subject to Section 3.03, to continue t he Lease Term through the Original Term and all Renewal Terms.
Lessee affirms that sufficient funds are legally available for the current fiscal year, and Lessee reasonably believes that an amount sufficient to make all Rental Payments during th e entire Scheduled Term can be obtained from legally available funds of Lessee. Lessee further intends to do all things lawfully within its power to obtain and maintain funds sufficient and available to discharge its obligation to make Rental Payments due hereunder, including making provision for 459
such payments to the extent necessary in each budget or appropriation request submitted and adopted in accordance with applicable provisions of law. Notwithstanding the foregoing, the decision whether or not to b udget and appropriate funds or to extend the Lease Term for any Renewal Term is within the sole discretion of the governing body of Lessee.
D. The following shall be inserted in lieu of Section 3.03 of the Master Equipment Lease:
Section 3.03. Nonappropriation. Lessee is obligated only to pay such Rental Payments as may lawfully be made during Lessee’s then current fiscal year from funds budgeted and appropriated for that purpose. Should Lessee fail to budget, appropriate or otherwise make available funds to pay Rental Payments following the then current Original Term or Renewal Term, this Agreement shall be deemed terminated at the end of the then current Original Term or Renewal Term. Lessee agrees to deliver notice to Lessor of such termination promp tly after any decision to non-appropriate is made, but failure to give such notice shall not extend the Scheduled Term beyond such Original Term or Renewal Term. If this Agreement is terminated in accordance with this Section, Lessee agrees to cease use of the Equipment and peaceably remove and deliver at Lessee’s sole expense the Equipment to Lessor at the location(s) to be specified by Lessor within the State; provided, that Lessee shall pay month-to-month rent at the Contract Rate (or the Taxable Rate if then in effect) for each month or part thereof that Lessee fails to return the Equipment pursuant to this Section 3.03.
E. “Subject to Section 3.03,” shall be inserted at the beginning of the first sentence of Section 4.01 of the Master Equipment Lease.
F. In Section 6.01 of the Master Equipment Lease, first paragraph, the following shall be inserted after the second sentence:
Upon the occurrence of an Event of Default or upon termination of this Agreement pursuant to Section 3.03, full and unencumbered legal title to the Equipment shall, at Lessor’s option, pass to Lessor, and Lessee shall have no further interest therein. In addition, upon the occurrence of such an Event of Default or such termination, Lessee shall execute and deliver to Lessor such documents as Lessor may request to evidence the passage of such legal title to Lessor and the termination of Lessee’s interest therein, and upon request by Lessor shall deliver possession of the Equipment to Lessor in accordance with Section 3.03 or Section 12.02, as applicable.
G. In Section 7.02 of the Master Equipment Lease, the following shall be deleted:
(d) rental interruption insurance in an amount which shall cover Rental Payments for no less than 24 months;
H. In Section 12.02 of the Master Equipme nt Lease, the following paragraphs (a) through (d) shall be inserted in lieu of the existing paragraphs (a) through (d):
(a) By written notice to Lessee, Lessor may declare all Rental Payments payable by Lessee and other amounts payable by Lessee hereunder to the end of the then current Original Term or Renewal Term to be due;
460
(b) With or without terminating the Lease Term, Lessor may enter the premises where the Equipment is located and retake possession of such Equipment or require Lessee at Lessee’s expense to promptly return any or all of such Equipment to the possession of Lessor at such place within the United States as Lessor shall specify, and sell or lease such Equipment or, for the account of Lessee, sublease such Equipment, continuing to hold Les see liable, but solely from legally available funds, for the difference between (i) the Rental Payments payable by Lessee and other amounts hereunder or the Equipment that are payable by Lessee to the end of the then current Original Term or Renewal Term, as the case may be, and (ii) the net proceeds of any such sale, leasing or subleasing (after deducting all expenses of Lessor in exercising its remedies hereunder, including without limitation all expenses of taking possession, storing, reconditioning and selling or leasing such Equipment and all brokerage, auctioneer’s and attorney’s fees). The exercise of any such remedies respecting any such Event of Default shall not relieve Lessee of any other liabilities hereunder or with respect to the Equipment; (c) Lessor may terminate the Escrow Agreement and apply any proceeds in the Escrow Account to the Rental Payments scheduled to be paid hereunder; and (d) Lessor may take whatever action at law or in equity may appear necessary or desirable to enforce its rights under this Agreement or the Escrow Agreement or as a secured party in any or all of the Equipment or the Escrow Account.
All capitalized terms used herein, other than those amended or added, above, shall have the meanings ascribed to them in the Master Equipment Lease.
2. Equipment. For purposes of the Lease created hereby, the Equipment shall as comprise the property acquired with the proceeds of this Schedule of Property No. 4, together with all substitutions, renewals, repairs, or replacements, for or as additions, improvements, accessions and accumulation of such Equipment, and any accessories, equipment or other personal property, parts and appurtenances appertaining or attached to any of such equipment and other personal property or from time to time incorporated therein and installed thereon, including, but not limited to the following:
a. fire apparatus and vehicles to be more fully described on vendor invoices submitted with requisitions from the Escrow Account.
3. Payment Schedule.
(a) Rental Payments . The Rental Payments shall be in such amounts and payable on such dates as set forth in the Rental Payment Schedule attached to this Schedule as Exhibit A-1. Rental Payments shall commence on the date on which the Equipment listed in this Schedule is accepted by Lessee, as indicated in an Acceptance Certificate substantially in the form of Exhibit B to the Master Equipment Lease or the date on which sufficient money s to purchase the Equipment are deposited for that purpose with an Escrow Agent, whichever is earlier. (b) Purchase Price Schedule. The Purchase Price on each Rental Payment date for the Equipment listed in this Schedule shall be the amount set forth for such Rental Payment 461
date in the “Purchase Price” column of the Rental Payment Schedule attached to this Schedule.
The Purchase Price is in addition to all Rental Payments then due under this Schedule (including the Rental Payment shown on the same line in the Rental Payment Schedule).
4. Representations, Warranties and Covenants . Lessee hereby represents, warrants and covenants that its representations, warranties and covenants set forth in the Master Equipment Lease are true and correct as though made on the date of commencement of Rental Payments on this Schedule. Lessee further represents and warrants that no material adverse change in Lessee’s financial condition has occurred since the date of the Master Equipment Lease.
5. The Lease. The terms and p rovisions of the Master Equipment Lease (other than to the extent that they relate solely to other Schedules or Equipment listed on other Schedules) are hereby incorporated into this Schedule by reference and made a part hereof.
6. Lease Proceeds. The Lease Proceeds which Lessor shall pay to the Escrow Agent for deposit to the Escrow Account in connection with this Schedule is $3,261,000.
7. Acquisition Period. The Acquisition Period applicable to this Schedule shall end at the conclusion of the 36th month following the date hereof.
8. Surety Bonds; Lessee to Pursue Remedies Against Contractors and Sub -Contractors and Their Sureties. Lessee shall secure from each Vendor directly employed by Lessee in connection with the acquisition, construction, installation, improvement or equipping of the Equipment listed in this Schedule, a payment and performance bond (“Surety Bond”) executed by a surety company authorized to do business in the State, having a financial strength rating by A.M.
Best Company of “A-” or better, and otherwise satisfactory to Lessor and naming Lessor as a co - obligee in a sum equal to the entire amount to become payable under each Vendor Agreement.
Each bond shall be conditioned on the completion of the work in accordance with the plans and specifications for the Equipment listed in this Schedule and upon payment of all claims of subcontractors and suppliers. Lessee shall cause the surety company to add Lessor as a co-obligee on each Surety Bond and shall deliver a certified copy of each Surety Bond to Lessor promptly upon receipt thereof by Lessee. Any proceeds from a Surety Bond shall be applied in accordance with such Surety Bond to the payment and performance of the Vendor’s obligations in accordance with the related Vendor Agreement and, if for whatever reason such proceeds are not so applied, first to amounts due Lessor under this Schedule, and any remaining amounts shall be payable to Lessee.
In the event of a material default of any Vendor under any Vendor Agreement in connection with the acquisition, construction, maintenance and/or servicing of the Equipment listed in this Schedule or in the event of a material breach of warranty with respect to any material workmanship or performance guaranty with respect to such Equipment, Lessee will promptly proceed to exhaust its remedies against the Vendor in default. Lessee shall advise Lessor of the steps it intends to take in connection with any such default. Any amounts received by Lessee in respect of damages, refunds, adjustments or otherwise in connection with the foregoing shall be paid to Lessor and applied against Lessee’s obligations under this Schedule. 462
As a prerequisite to the performance by Lessor of any of its obligations under this Schedule, Lessee shall deliver to Lessor, in form and substance satisfactory to Lessor, a certified copy of each Surety Bond satisfying the conditions set forth in this Section 8, or, at Lessor’s sole discretion, such Surety Bonds may be provided after the Commencement Date of this Schedule, provided however, that no “Disbursement Request” pursuant to the Escrow Agreement for this Schedule shall be authorized by Lessor until such Suret y Bonds satisfying the conditions set forth in this Section 8 have been delivered to Lessor.
9. Lease Term. The Lease Term shall consist of 84 months, ending on December 1, 2032.
10. Purchase Option Commencement Date. For purposes of Section 10.01(a) of the Lease, the Purchase Option Commencement Date is December 1, 2029. 11 Registration. Motor vehicles are to be registered and titled as follows:
Registered Owner: City of Salinas
Lienholder: Banc of America Public Capital Corp
Bank of America Plaza
600 Peachtree Street NE, 11th Floor
Atlanta, GA 30308-2265
Lessee shall be responsible for the correct titling of all Equipment leased hereunder. Lessee will cause the original Certificates of Title to be delivered to Lessor for retention in Lessor’s file throughout the term of the Lease.
All costs associated with the registration and licensing of the Equipment will be for the account of the Lessee.
463
Dated: February 12, 2026
LESSOR: LESSEE:
Banc of America Public Capital Corp City of Salinas
555 California Street, 6th Floor 200 Lincoln Avenue
San Francisco, California 94104 Salinas, California 93901
By By
Title Title
(Seal)
Attest:
By
Title
Counterpart No. _____ of _____ manually executed and serially numbered counterparts.
To the extent that this Lease constitutes chattel paper (as defined in the Uniform Commercial Code), no security interest herein may be created through the transfer or possession of any Counterpart other than Counterpart No. 1.
464
EXHIBIT A-1
RENTAL PAYMENT SCHEDULE
Rental Rental Rental Interest
Payment Payment Payment Portion Principal Payment
Number Date Amount @ 3.4917 Portion Balance Price
1 12/1/2026 $527,741.76 $91,407.76 $436,334.00 $2,824,666.00 N/A 2 12/1/2027 $529,955.86 $98,628.86 $431,327.00 $2,393,339.00 N/A 3 12/1/2028 $529,955.22 $83,568.22 $446,387.00 $1,946,952.00 N/A 4 12/1/2029 $529,955.72 $67,981.72 $461,974.00 $1,484,978.00 $1,484,978.00 5 12/1/2030 $529,955.98 $51,850.98 $478,105.00 $1,006,873.00 $1,006,873.00 6 12/1/2031 $529,954.98 $35,156.98 $494,798.00 $512,075.00 $512,075.00 7 12/1/2032 $529,955.12 $17,880.12 $512,075.00 -
----------- ----------- -----------
$3,707,474.64 $446,474.64 $3,261,000.00
Prepayment Premium for purposes of Section 10.01(a) is 0%.
For purposes of this Lease, “Taxable Rate,” with respect to the interest component of Rental Payments, means an annual rate of interest equal to 4.4565%.
LESSEE:
City of Salinas
By
Title
465
4855-6991-3093.2
ESCROW AND ACCOUNT CONTROL AGREEMENT
This ESCROW AND ACCOUNT CONTROL AGREEMENT (this “Agreement”), dated as of February 12, 2026, by and among Ban c of America Public Capital Corp , a Kansas corporation (together with its successors and assigns, hereinafter referred to as “Lessor”), City of Salinas, a charter city and municipal corporation existing under the laws of the State of California (hereinafter referred to as “Lessee”) and Argent Institutional Trust Company , a Florida trust company (hereinafter referred to as “Escrow Agent”).
Reference is made to that certain Schedule of Property No. 4, dated February 12, 2026 to Master Equipment Lease/Purchase Agreement dated as of June 1, 2012 , between Lessor and Lessee (hereinafter referred to as the “Lease”), covering the acquisition and lease of certain Equipment described therein (the “Equipment”). It is a requirement of the Lease that the Acquisition Amount in the amount of $3,261,000.00 be deposited into a segregated escrow account under terms satisfactory to Lessor, for the purpose of fully funding the Lease, and providing a mechanism for the application of such amounts to the purchase of and payment for the Equipment.
NOW, THEREFORE, in consideration of the mutual promises contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Creation of Escrow Account.
(a) There is hereby created an escrow fund to be known as the “City of Salinas Schedule of Property No. 4 Escrow Account ” (the “Escrow Account”) to be held by the Escrow Agent for the purposes stated herein, for the benefit of Lessor and Lessee, to be held, disbursed and returned in accordance with the terms hereof.
(b) Lessee may, from time to time, provide written instructions for Escrow Agent to use any available cash in the Escrow Account to purchase any money market fund or liquid deposit investment vehicle that E scrow Agent from time to time makes available to the parties hereto. Such written instructions shall be provided via delivery to Escrow Agent of a signed and completed Escrow Account Investment Selection Form (such form available from Escrow Agent upon request). All funds invested by Escrow Agent at the direction of Lessee in such short- term investments (as more particularly described in Escrow Agent ’s Escrow Account Investment Selection Form) shall be deemed to be part of the Escrow Account and subject to all the terms and conditions of this Agreement. If any cash is received for the Escrow Account after the cut-off time for the designated short -term investment vehicle, the Escrow Agent shall hold such cash uninvested until the next Business Day. In the absence of written instructions from Lessee (on Escrow Agent’s Escrow Account Investment Selection Form) designating a short-term investment of cash in the Escrow Account, cash in the Esc row Account shall remain uninvested and it shall not be collateralized. Escrow Agent shall have no obligation to pay interest on cash in respect of any period during which it remains uninvested. Lessee shall be solely responsible for ascertaining that all proposed investments and reinvestments are Qualified Investments and that they comply with federal, state and local laws, regulations and ordinances governing investment of such funds and for pro viding appropriate notice to the Escrow Agent for the reinvestment of any maturing investment. Accordingly, neither the Escrow Agent nor Lessor shall be responsible for any 466
2 liability, cost, expense, loss or claim of any kind, directly or indirectly arising out of or related to the investment or reinvestment of all or any portion of the moneys on deposit in the Escrow Account, and Lessee agrees to and does hereby release the Escrow Agent and Lessor from any such liability, cost, expenses, loss or claim. Inte rest on the Escrow Account shall become part of the Escrow Account, and gains and losses on the investment of the moneys on deposit in the Escrow Account shall be borne by the Lessee. The Escrow Agent shall have no discretion whatsoever with respect to the management, disposition or investment of the Escrow Account.
The Escrow Agent shall not be responsible for any market decline in the value of the Escrow Account and has no obligation to notify Lessor and Lessee of any such decline or take any action with respect to the Escrow Account, except upon specific written instructions stated herein. For purposes of this Agreement, “Qualified Investments” means any investments which meet the requirements of California Government Code Sections 53600-53610. (c) Unless the Escrow Account is earlier terminated in accordance with the provisions of paragraph (d) below, amounts in the Escrow Account shall be disbursed by the Escrow Agent in payment of amounts described in Section 2 hereof upon receipt of written instruction(s) from Lessor, as is more fully described in Section 2 hereof. If the amounts in the Escrow Account are insufficient to pay such amounts, Lessee shall provide any balance of the funds needed to complete the acquisition of the Equipment. Any moneys remaining in the Escrow Account on or after the earlier of (i) the expiration of the Acquisition Period or (ii) the date on which Lessee executes an Acceptance Certificate shall be applied as provided in Section 4 hereof. (d) The Escrow Account shall be term inated at the earliest of (i) the final distribution of amounts in the Escrow Account, (ii) the date on which Lessee executes a Final Acceptance Certificate or (iii) written notice given by Lessor of the occurrence of an Event of Default under the Lease or termination of the Lease due to an Event of Non -appropriation.
Notwithstanding the foregoing, this Agreement shall not terminate nor shall the Escrow Account be closed until all funds deposited hereunder have been disbursed. (e) The Escro w Agent may act in reliance upon any writing or instrument or signature which it, in good faith, believes to be genuine and may assume the validity and accuracy of any statement or assertion contained in such a writing or instrument. The Escrow Agent shal l not be liable in any manner for the sufficiency or correctness as to form, manner of execution, or validity of any instrument nor as to the identity, authority, or right of any person executing the same; and its duties hereunder shall be limited to the receipt of such moneys, instruments or other documents received by it as the Escrow Agent, and for the disposition of the same in accordance herewith. Notwithstanding and without limiting the generality of the foregoing, concurrent with the execution of this Agreement, Lessee and Lessor, respectively, shall deliver to the Escrow Agent an authorized signers form in the form of Exhibit A-1 (Lessee) and Exhibit A-2 (Lessor) attached hereto. Notwithstanding the foregoing sentence, the Escrow Agent is authorized to comply with and rely upon any notices, instructions or other communications believed by it to have been sent or given by the parties or by a person or persons authorized by the parties. The Escrow Agent specifically allows for receiving direction by written or electronic transmission from an authorized representative with the following caveat, Lessee and Lessor agree to indemnify and hold harmless the Escrow Agent against any and all claims, losses, damages, liabilities, judgments, costs and expenses (including reasonable attorneys’ fees) (collectively, “Losses”) incurred or sustained by the Escrow Agent as a result of or in connection with the Escrow Agent ’s reliance upon and 467
3 compliance with instructions or directions given by written or electronic tra nsmission given by each, respectively, provided, however, that such Losses have not arisen from the gross negligence or willful misconduct of the Escrow Agent, it being understood that forbearance on the part of the Escrow Agent to verify or confirm that the person giving the instructions or directions, is, in fact, an authorized person shall not be deemed to constitute gross negligence or willful misconduct.
In the event conflicting instructions as to the disposition of all or any portion of the Escrow Account are at any time given by Lessor and Lessee, the Escrow Agent shall abide by the instructions or entitlement orders given by Lessor without consent of the Lessee. (f) Unless the Escrow Agent is guilty of gross negligence or willful misconduct with regard to its duties hereunder, Lessee agrees to and does hereby release and indemnify the Escrow Agent and hold it harmless from any and all claims, liabilities, losses, actions, suits or proceedings at law or in equity, or any other expenses, fees or charges of any character or nature, which it may incur or with which it may be threatened by reason of its acting as Escrow Agent under this Agreement; and in connection therewith, does to the extent permitted by law, indemnify the Escrow Agent against any and a ll expenses, including reasonable attorneys’ fees and the cost of defending any action, suit or proceeding or resisting any claim. (g) If Lessee and Lessor shall be in disagreement about the interpretation of the Lease, or about the rights and obligations, or the propriety of any action contemplated by the Escrow Agent hereunder, the Escrow Agent may, but shall not be required to, file an appropriate civil action including an interpleader action to resolve the disagreement. The Escrow Agent shall be reimbursed by Lessee for all costs, including reasonable attorneys ’ fees, in connection with such civil action, and shall be fully protected in suspending all or part of its activities under the Lease until a final judgment in such action is received. (h) The Escrow Agent may consult with counsel of its own choice and shall have full and complete authorization and protection with the opinion of such counsel. The Escrow Agent shall otherwise not be liable for any mistakes of fact or errors of judgment, or for a ny acts or omissions of any kind unless caused by its willful misconduct. (i) Lessee shall reimburse the Escrow Agent for all reasonable costs and expenses, including those of the Escrow Agent ’s attorneys, agents and employees incurred for non-routine administration of the Escrow Account and the performance of the Escrow Agent ’s powers and duties hereunder in connection with any Event of Default under the Lease, any termination of the Lease due to an Event of Non -appropriation or in connection with any disp ute between Lessor and Lessee concerning the Escrow Account. (j) The Escrow Agent or any successor may at any time resign by giving mailed notice to Lessee and Lessor of its intention to resign and of the proposed date of resignation (the “Effective Date”), which shall be a date not less than 60 days after such notice is delivered to an express carrier, charges prepaid, unless an earlier resignation date and the appointment of a successor shall have been approved by the Lessee and Lessor. After the Effective Date, the Escrow Agent shall be under no further obligation except to hold the Escrow Account in accordance with the terms of this Agreement, pending receipt of written instructions from Lessor regarding further disposition of the Escrow Account.
468
4 (k) The Escrow Agent shall have no responsibilities, obligations or duties other than those expressly set forth in this Agreement and no implied duties, responsibilities or obligations shall be read into this Agreement.
2. Acquisition of Property.
(a) Acquisition Contracts. Lessee will arrange for, supervise and provide for, or cause to be supervised and provided for, the acquisition of the Equipment, with moneys available in the Escrow Account. Lessee represents the estimated costs of the Equipment a re within the funds estimated to be available therefor, and Lessor makes no warranty or representation with respect thereto. Lessor shall have no liability under any of the acquisition or construction contracts. Lessee shall obtain all necessary permits and approvals, if any, for the acquisition, equipping and installation of the Equipment, and the operation and maintenance thereof. Escrow Agent shall have no duty to monitor or enforce Lessee’s compliance with the foregoing covenant. (b) Authorized Escrow Account Disbursements. It is agreed as between Lessee and Lessor that disbursements from the Escrow Account shall be made for the purpose of paying (including the reimbursement to Lessee for advances from its own funds to accomplish the purposes hereinafter described) the cost of acquiring the Equipment. (c) Requisition Procedure. No disbursement from the Escrow Account shall be made unless and until Lessor has approved such requisition. Prior to disbursement from the Escrow Account there shall be filed with the Escrow Agent a requisition for such payment in the form of Disbursement Request attached hereto as Schedule 1, stating each amount to be paid and the name of the person, firm or corporation to whom payment thereof is due. All disburs ements shall be made by wire transfer. The Escrow Agent is authorized to obtain and rely on confirmation of such Disbursement Request and payment instructions by telephone call -back to the person or persons designated for verifying such requests on Exhibit A-2 (such person verifying the request shall be different than the person initiating the request). The Lessor and Lessee hereby confirm that any call-back performed by Escrow Agent to verify a disbursement instruction pursuant to a Disbursement Request s ubmitted pursuant to this Section 2(c) before release, shall be made to Lessor only and Escrow Agent shall have no obligation to call-back Lessee.
Each such Disbursement Request shall be signed by an authorized representative of Lessee (an “Authorized Representative”) and by Lessor, and shall be subject to the following conditions, which Escrow Agent shall conclusively presume have been satisfied at such time as a requisition executed by Lessee and Lessor is delivered to it:
1. Delivery to Lessor of an exe cuted Disbursement Request in the form attached hereto as Schedule 1; and
2. Delivery to Lessor of copies of invoices (and proofs of payment of such invoices, if Lessee seeks reimbursement) and bills of sale (if title to such Equipment has passed to Lessee) therefor as required by Section 3.04 of the Lease and any additional documentation reasonably requested by Lessor. 469
5 Lessee and Lessor agree that their execution of the form attached hereto as Schedule 1 and delivery of the executed form to Escrow Agent confirms that all of the requirements and conditions with respect to disbursements set forth in this Section 2 have been satisfied.
3. Deposit to Escrow Account . Upon satisfaction of the conditions specified in Section 3.04 of the Lease, Lessor will cause the Acquisition Amount to be deposited in the Escrow Account. Lessee agrees to pay any costs with respect to the Equipment in excess of amounts available therefor in the Escrow Account.
4. Excessive Escrow Account . Upon receipt of written instructions fr om Lessor including a representation that one of the following conditions has been satisfied (upon which representation Escrow Agent shall conclusively rely), any funds remaining in the Escrow Account on or after the earlier of (a) the expiration of the Acquisition Period or (b) the date on which Lessee executes an Acceptance Certificate, or upon a termination of the Escrow Account as otherwise provided herein, shall be distributed by the Escrow Agent to the Lessor in order for the Lessor to apply such funds to amounts owed by Lessee under the Lease in accordance with Section 4.07 of the Lease.
5. Security Interest. The Escrow Agent and Lessee acknowledge and agree that the Escrow Account and all proceeds thereof are being held by Escrow Agent for disbursem ent or return as set forth herein. Lessee hereby grants to Lessor a first priority perfected security interest in the Escrow Account, and all proceeds thereof, and all investments made with any amounts in the Escrow Account. If the Escrow Account, or any part thereof, is converted to investments as set forth in this Agreement, such investments shall be made in the name of Escrow Agent and the Escrow Agent hereby agrees to hold such investments as bailee for Lessor so that Lessor is deemed to have possession of such investments for the purpose of perfecting its security interest.
6. Control of Escrow Account. In order to perfect Lessor’s security interest by means of control in (i) the Escrow Account established hereunder, (ii) all securities entitlements, investment property and other financial assets now or hereafter credited to the Escrow Account, (iii) all of Lessee ’s rights in respect of the Escrow Account, such securities entitlements, investment property and other financial assets, and (iv) all products, proceeds and revenues of and from any of the foregoing personal property (collectively, the “Collateral”), Lessor, Lessee and Escrow Agent further agree as follows:
(a) All terms used in this Section 6 which are defined in the Commercial Code of the State of California (“Commercial Code”) but are not otherwise defined herein shall have the meanings assigned to such terms in the Commercial Code, as in effect on the date of this Agreement.
(b) Escrow Agent will comply with all entitlement orders originated by Lessor with respect to the Collateral, or any portion of the Collateral, without further consent by Lessee. (c) Provided that account investments shall be held in the name of the Escrow Agent, Escrow Agent hereby represents and warrants (i) t hat the records of Escrow Agent show that Lessee is the sole owner of the Collateral, (ii) that Escrow Agent has not been served with any notice of levy or received any notice of any security interest in or other claim to the Collateral, or 470
6 any portion of the Collateral, other than Lessor ’s claim pursuant to this Agreement, and (iii) that Escrow Agent is not presently obligated to accept any entitlement order from any person with respect to the Collateral, except for entitlement orders that Escrow Agent is obligated to accept from Lessor under this Agreement and entitlement orders that Escrow Agent, subject to the provisions of paragraph (e) below, is obligated to accept from Lessee. (d) Without the prior written consent of Lessor, Escrow Agent will not ente r into any agreement by which Escrow Agent agrees to comply with any entitlement order of any person other than Lessor or, subject to the provisions of paragraph (e) below, Lessee, with respect to any portion or all of the Collateral. Escrow Agent shall p romptly notify Lessor if any person requests Escrow Agent to enter into any such agreement or otherwise asserts or seeks to assert a lien, encumbrance or adverse claim against any portion or all of the Collateral. (e) Except as otherwise provided in this p aragraph (e) and subject to Section 1(b) hereof, Lessee may effect sales, trades, transfers and exchanges of Collateral within the Escrow Account, but will not, without the prior written consent of Lessor, withdraw any Collateral from the Escrow Account. Escrow Agent acknowledges that Lessor reserves the right, by delivery of written notice to Escrow Agent, to prohibit Lessee from effecting any withdrawals (including withdrawals of ordinary cash dividends and interest income), sales, trades, transfers or exchanges of any Collateral held in the Escrow Account. Further, Escrow Agent hereby agrees to comply with any and all written instructions delivered by Lessor to Escrow Agent (once it has had a reasonable opportunity to comply therewith) and has no obliga tion to, and will not, investigate the reason for any action taken by Lessor, the amount of any obligations of Lessee to Lessor, the validity of any of Lessor’s claims against or agreements with Lessee, the existence of any defaults under such agreements, or any other matter.
(f) Lessee hereby irrevocably authorizes Escrow Agent to comply with all instructions and entitlement orders delivered by Lessor to Escrow Agent. (g) Escrow Agent will not attempt to assert control and does not claim and will not accept any security or other interest in, any part of the Collateral, and Escrow Agent will not exercise, enforce or attempt to enforce any right of setoff against the Collater al, or otherwise charge or deduct from the Collateral any amount whatsoever. (h) Escrow Agent and Lessee hereby agree that any property held in the Escrow Account shall be treated as a financial asset under such section of the Commercial Code as corresponds with Section 8-102 of the Uniform Commercial Code, notwithstanding any contrary provision of any other agreement to which Escrow Agent may be a party. (i) Escrow Agent is hereby authorized and instructed, and hereby agrees, to send to Lessor at its address set forth in Section 8 below, concurrently with the sending thereof to Lessee, duplicate copies of any and all monthly Escrow Account statements or reports issued or sent to Lessee with respect to the Escrow Account.
7. Information Required Under USA PATRIOT ACT. The parties acknowledge that in order to help the United States government fight the funding of terrorism and money laundering activities, pursuant to Federal regulations that became effective on October 1, 2003 (Section 326 471
7 of the USA PATRIOT Act) all financial institutions are required to obtain, verify, record and update information that identifies each person establishing a relationship or opening an account.
The parties to this Agreement agree that they will provide to the Escrow Agent such information as it may request, from time to time, in order for the Escrow Agent to satisfy the requirements of the USA PATRIOT Act, including but not limited to the name, address, tax identification number and other information that will allow it to identify the individual or entity who is establishing the relationship or opening the account and may also ask for formation documents such as articles of incorporation or other identifying documents to be provided.
8. Miscellaneous. Capitalized ter ms not otherwise defined herein shall have the meanings assigned to them in the Lease. This Agreement may not be amended except in writing signed by all parties hereto. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original instrument and each shall have the force and effect of an original and all of which together constitute, and shall be deemed to constitute, one and the same instrument. Notices hereunder shall be made in writing and shall be deemed to have been duly given when personally delivered or when deposited in the mail, first class postage prepaid, or delivered to an express carrier, charges prepaid, or sent by facsimile with electronic confirmation, addressed to each party at its address below.
Notices and other communications hereunder may be delivered or furnished by electronic mail provided that any formal notice be attached to an email message in PDF format and provided further that any notice or other communication sent to an e-mail address shall be deemed received upon and only upon the sender ’s receipt of affirmative acknowledgement or receipt from the intended recipient. For purposes hereof no acknowledgement of receipt generated on an automated basis shall be deemed sufficient for an y purpose hereunder or admissible as evidence of receipt.
It is understood and agreed that for no purpose shall notice to Argent Institutional Trust Company in its capacity hereunder constitute notice to Banc of America Public Capital Corp in its capacity hereunder.
If to Lessor:
Banc of America Public Capital Corp
11333 McCormick Road
Hunt Valley II
M/C MD5-032-07-05
Hunt Valley, MD 21031
Attn: Contract Administration
Fax: (443) 541-3057
If to Lessee:
City of Salinas
200 Lincoln Avenue
Salinas, CA 93901
Attn:
If to Escrow Agent:
Argent Institutional Trust Company
472
8 Attn: Alice M. Wolan
1715 N. Westshore Boulevard, Suite 750
Tampa, FL 33607
Telephone: 312-405-5393
E-Mail: [email protected]
9. Lessee and Lessor understand and agree that they are required to provide the Escrow Agent with a properly completed and signed Tax Certification (as defined below) and that the Escrow Agent may not perform its duties hereunder without having been provided with such Tax Certification. As used herein “Tax Certification” shall mean an IRS form W -9 or W -8 as described above. The Escrow Agent will comply with any U.S. tax withholding or backup withholding and reporting requirements that are required by law. With respect to earnings allocable to a foreign person, the Escrow Agent will withhold U.S. tax as required by law and report such earnings and taxes withheld, if any, for the benefit of such foreign person on IRS Form 1042-S (or any other required form), unless such earnings and withheld taxes are exempt from reporting under Treasury Regulation Section 1.1461-1I(2)(ii) or under other applicable law. With respect to earnings allocable to a United States person, the Escrow Agent will report such income, if required, on IRS Form 1099 or any other form required by law. The IRS Forms 1099 and/or 1042-S shall show the Escrow Agent as payor and Lessee as payee. Escrow Agent shall recognize Lessee as the designated party for regulatory reporting purposes.
Lessee and Lessor agree that they are not relieved of their respective obligations, if any, to prepare and file information reports under Code Section 6041, and the Treasury regulations thereunder, with respect to amounts of imputed interest income, as determined pursuant to Code Sections 483 or 1272. The Escrow Agent shall not be responsible for determining or reporting such imputed interest.
10. This Agreement shall be governed by and construed in accordance with the laws of the State of California and the parties hereto consent to jurisdiction in the State of California and venue in any state or federal court located in the City of Los Angeles.
11. Any bank or corporation into which the Escrow Agent may be merged or with which it may be consolidated, or any bank or corporation to whom the Escrow Agent may transfer a substantial amount of its escrow business, shall be the successor to the Escrow Agent without the execution or filing of any paper or any further act on the part of any of the parties, anything herein to the contrary notwithstanding. Any bank or corporation into which the Lessor may be merged or with which it may be consolidated, or any bank or corporation to whom the Lessor may transfer a substantial amount of its business, shall be the successor to the Lessor without the execution or filing of any paper or any further act on the part of any of the parties, anything herein to the contrary notwithstanding.
12. This Agreement may be amended, modified, and/or supplemented only by an instrument in writing executed by all parties hereto.
13. No party hereto shall assign its rights hereunder until its assignee has submitted to the Escrow Agent (i) Patriot Act disclosure materials and the Escrow Agent has determined that on the basis of such materials it may accept such assignee as a customer and (ii) assignee has 473
9 delivered an IRS Form W-8 or W-9, as appropriate, to the Escrow Agent which the Escrow Agent has determined to have been properly signed and completed.
14. Escrow Agent will treat information related to this Agreement as confidential but, unless prohibited by law, Lessee and Lessor authorize the transfer or disclosure of any information relating to this Agre ement to and between the subsidiaries, officers, affiliates and other representatives and advisors of Escrow Agent and third parties selected by any of them, wherever situated, for confidential use in the ordinary course of business, and further acknowledg e that Escrow Agent and any such subsidiary, officer, affiliate or third party may transfer or disclose any such information as required by any law, court, regulator or legal process.
Lessor will treat information related to this Agreement as confidential but, unless prohibited by law, Escrow Agent and Lessee authorize the transfer or disclosure of any information relating to this Agreement to and between the subsidiaries, officers, affiliates, other representatives and advisors of Lessor and debt and equity sources and third parties selected by any of them, and to their prospective assignees wherever situated, for confidential use in the ordinary course of business, and further acknowledge that Lessor and any such subsidiary, officer, affiliate, debt and equity source or third party or prospective assignee may transfer or disclose any such information as required by any law, court, regulator or legal process.
Lessee will treat the terms of this Agreement as confidential except on a “need to know” basis to persons within or outside Lessee ’s organization (including affiliates of such party), such as attorneys, accountants, bankers, financial advisors, auditors and other consultants of such party and its affiliates, except as required by any law, court, regula tor or legal process and except pursuant to the express prior written consent of the other parties, which consent shall not be unreasonably withheld.
For the avoidance of doubt, nothing herein prohibits any individual from communicating or disclosing infor mation regarding suspected violations of laws, rules, or regulations to a governmental, regulatory, or self-regulatory authority.
[Remainder of page intentionally left blank; signature page follows] 474
[Signature page to Escrow Agreement – Schedule of Property No. 4] IN WITNESS WHEREOF, the parties have executed this Escrow and Account Control Agreement as of the date first above written.
BANC OF AMERICA PUBLIC CAPITAL CORP CITY OF SALINAS
as Lessor as Lessee
By: By:
Name: Name: ______________________________
Title: Title: ______________________________
ARGENT INSTITUTIONAL TRUST COMPANY
as Escrow Agent
By:
Name:
Title:
475
Schedule 1-1
SCHEDULE 1
to the Escrow and Account Control Agreement
FORM OF DISBURSEMENT REQUEST
Re: Schedule of Property No. 4 dated February 12, 2026 to Master Equipment Lease/Purchase Agreement dated as of June 1, 2012, by and between Banc of America Public Capital Corp , as Lessor, and the City of Salinas , as Lessee (the “Lease”) (Capitalized terms not otherwise defined herein shall have the meanings assigned to them in the Lease.)
In accordance with the te rms of the Escrow and Account Control Agreement, dated as of February 12, 2026 (the “Escrow and Account Control Agreement” ) by and among Ban c of America Public Capital Corp (“Lessor”), the City of Salinas (“Lessee”) and Argent Institutional Trust Company , as escrow agent (the “Escrow Agent” ), the undersigned hereby requests the Escrow Agent pay the following persons the following amounts from the Escrow Account created under the Escrow and Account Control Agreement for the following purposes:
Disbursement Amounts:
Payee’s Name and Address Invoice Number Dollar Amount Purpose <Payee’s Name>
<Payee Address 1>
<Payee Address 2>
<Payee Address 3>
<Payee Bank Name*>
<Payee Bank ABA/Routing*>
<Payee Bank Account No*>
<Payee Account Name*>
<*Payee Address and Payee Bank
information is required.>
<invoice list OR “see
attached” with a
spreadsheet>
< invoice amount> <general description of
equipment; ex “police cruiser”>
<Payee’s Name>
<Payee Address 1>
<Payee Address 2>
<Payee Address 3>
<Payee Bank Name*>
<Payee Bank ABA/Routing*>
<Payee Bank Account No*>
<Payee Account Name*>
<*Payee Address and Payee Bank
information is required.>
<invoice list OR “see
attached” with a
spreadsheet>
<invoice amount> <general description of
equipment; ex “police cruiser”>
Lessee hereby represents, covenants and warrants for the benefit of Lessor on the date hereof as follows:
476
Schedule 1-2
(i) (a) Each obligation specified in the table herein titled as “Disbursement Amounts” has been incurred by Lessee in the stated amount, (b) the same is a proper charge against the Escrow Account for costs relating to the Equipment identified in the Lease, and (c) has not been paid (or has been paid by Lessee and Lessee requests reimbursement thereof).
(ii) Each item of Equipment relating to an obl igation specified in the table herein titled as “Disbursement Amounts” has been delivered, installed and accepted by Lessee. Attached hereto is a copy of the invoice with respect to such obligation.
(iii) The undersigned, as Authorized Representative, has no notice of any vendor’s, mechanic’s or other liens or rights to liens, chattel mortgages, conditional sales contracts or security interest which should be satisfied or discharged before such payment is made. (iv) This requisition contains no item repre senting payment on account, or any retained percentages which Lessee is, at the date hereof, entitled to retain (except to the extent such amounts represent a reimbursement to Lessee).
(v) The Equipment is insured in accordance with the Lease. (vi) No Event of Default, and no event which with notice or lapse of time, or both, would become an Event of Default, under the Lease has occurred and is continuing at the date hereof. No Event of Non-appropriation has occurred or is threatened with respect to the Lease. (vii) The disbursement shall occur during the Acquisition Period. (viii) The representations, warranties and covenants of Lessee set forth in the Lease are true and correct as of the date hereof.
(ix) No Material Adverse Change has occurred since the date of the execution and delivery of the Lease.
(x) The information in this Disbursement Request regarding each Payee, including their respective name, address and wiring instructions, (collectively, the “Payee Information”) is true and correct, such Payee Information has been verified and confirmed by Lessee and the Lessor can rely on Lessee’s verification and confirmation of the accuracy of such Payee Information.
Lessee hereby acknowledges and agrees that any call -back performed by Lessor to verify the disbursement instructions pursuant to this Disbursement Request shall be made to Lessee only and Lessor shall have no obligation to call-back any Payee listed above. [Remainder of page intentionally left blank]
477
Schedule 1-3
Dated: City of Salinas
By:
Name:
Title:
Disbursement of funds from the Escrow
Account in accordance with the foregoing
Disbursement Request hereby is authorized
BANC OF AMERICA PUBLIC CAPITAL CORP
as Lessor under the Lease
By:
Name:
Title:
478
A-1-1
[AN “EXHIBIT A-1” MUST BE COMPLETED AND EXECUTED AT TIME OF EXECUTION OF THE AGREEMENT] EXHIBIT A-1
FORM OF INCUMBENCY AND AUTHORIZATION CERTIFICATE
The undersigned, a duly elected or appointed and acting City Clerk of the City of Salinas (“Lessee”) certifies as follows:
A. The following listed persons are duly elected or appointed and acting officials of Lessee (the “Officials”) in the capacity set forth opposite their respective names below and the facsimile signatures below are true and correct as of the date hereof; and B. The Officials are duly authorized, on behalf of Lessee, to negotiate, execute and deliver Schedule of Property No. 4 dated February 12, 2026 (the “Schedule”) to that certain Master Equipment Lease/Purchase Agreement, dated as of June 1, 2012 (the “Agreement”) and separate Schedules relating thereto from time to time as provided in the Agreement (collectively, the “Schedules”), each by and between Lessee and Banc of America Public Capital Corp (“Lessor”), the Escrow and Account Control Agreement dated as of February 12, 2026, by and among Lessor, Lessee and Argent Institutional Trust Company as Escrow Agent, all documents related thereto and delivered in connection therewith, and any future modification(s) or amendments thereof (collectively, the “Operative Agreements ”), and the Operative Agreements are binding and authorized agreements of Lessee, enforceable in all res pects in ac cordance with their r espective terms.
Name of Official Title Signature
__________________ _________________ _____________________ __________________ _________________ _____________________ __________________ _________________ _____________________
Dated: February 12, 2026 By: _____________________________ Name: _____________________________
Title: _____________________________
(The signer of this Certificate cannot be listed above as authorized to execute the Operative Agreements.) 479
A-2-1
[AN “EXHIBIT A-2” MUST BE COMPLETED AND EXECUTED AT TIME OF EXECUTION OF THE AGREEMENT] EXHIBIT A-2
TO BE PROVIDED
480
Jill M. Forsyth
Senior Vice President
Global Leasing
14636 N. Scottsdale Road, Suite #200
Scottsdale, AZ 85254
T 480.624.0369 F 415.796.1301
[email protected]
“Bank of America” is the marketing name used by certain Global Banking and Global Markets businesses of Bank of America Corporation. Lending, leasing, equipment finance and other commercial banking activities, and trading in certain financial instruments are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Banc of America Public Capital Corp, a wholly-owned subsidiary of Bank of America, National Association, is not a municipal advisor and is not subject to the fiduciary duty established in Section 15B(c)(1) of the Securities Exchange Act of 1934, as amended, with respect to any municipal financial product or issuance of municipal securities. The information provided in this document is not intended to be and should not be construed as “advice” with the meaning Section 15B of the Securities Exchange Act of 1934 and the municipal advisor rules of the SEC.© 2019 Bank of America Corporation. All rights reserved.
SUMMARY OF TERMS AND CONDITIONS
Date: January 6, 2026
Lessee: City of Salinas, CA (“Lessee”)
Lessor: Banc of America Public Capital Corp or Designee (“Lessor”)
Structure: Privately-Placed Lease Purchase with appropriation
Amount: Approximately $3.2MM
Security: Assets being financed
Interest Rate: A) 7 years: 3.4917% B) 10 years: 3.7832%
The rates indicated above are for a funding on or before March 6th, Subject to Council action, this rate must be locked within 8 days via an email that indicates that Lessor is being recommended for an award. If the rate is not locked, it is subject to change based on market conditions.
Prepayment: Pre-payable in full after half of the term at par (without penalty) on any regularly scheduled payment date.
Governmental
Entity Lease: The Base Rent installments are calculated on the assumptions, and Lessee will represent, that Lessee is a state or political subdivision of a state within the meaning of Section 103(c) of the Internal Revenue Code (the “Code”), and that this transaction will constitute an obligation of Lessee within the meaning of Section 103(a) of the Code, notwithstanding Section 103(b) of the Code. Lessee shall provide Lessor with such evidence as Lessor may request to substantiate and maintain such tax status. Lessee shall comply with the filing requirements of Section 149(e) of the Code.
End of Term: At the expiration of the Lease Term, Lessee will own the equipment.
481
Opinion of Counsel: Lessee’s counsel shall deliver a validity opinion to Lessor at closing in form and substance satisfactory to Lessor. The opinion of counsel will cover that counsel has reviewed the documents and examined, approved and attached the text of the enabling resolution of Lessee’s governing body authorizing Lessee to enter into the Lease.
Documentation: Subject to legal and credit review; however, the City and BAPCC already have a negotiated master lease in place. This transaction would merely be a schedule to that master lease document. A performance bond will be required if payment is made to the vender/dealer prior to the assets being delivered.
Credit: Subject to credit and documentation approvals but the City already has a relationship with BAPCC and therefore, this review and closing can be done timely.
Market
Disruption: Notwithstanding anything contained herein to the contrary, in the event any material change shall occur in the financial markets after the date of this Proposal Letter, including but not limited to any governmental action or other event which materially adversely affects the extension of credit by banks, leasing companies or other lending institutions, the Lessor may modify the indicative pricing described above.
USA Patriot Act
Compliance: Lessee acknowledges that pursuant to the requirements of the USA Patriot Act, as amended from time to time (including as amended by the USA Freedom Act of 2015) (the "Patriot Act"), Lessor is required to obtain, verify and record information that identifies Lessee, which information includes the name and address of Lessee and other information that will allow Lessor to identify Lessee in accordance with the Patriot Act.
Proposal Expiration: This proposal will expire on March 30, 2026, and may be re-issued at Lessor’s discretion.
482
This proposal is submitted in response to your Request for Proposals for Lease Purchase Financing of equipment, due January 6, 2026..
The contents of this proposal and any subsequent discussions between us, including any and all information, recommendations, opinions, indicative pricing, quotations and analysis with respect to any municipal financial product or issuance of municipal securities, are provided to you in reliance upon the exemption provided for responses to requests for proposals or qualifications under the municipal advisor rules (the “Rules”) of the Securities and Exchange Commission (240 CFR 15Ba1-1 et seq.).
The Staff of the SEC’s Office of Municipal Securities has issued guidance which provides that, in order for a request for proposals to be consistent with this exemption, it must (a) identify a particular objective, (b) be open for not more than a reasonable period of time (up to six months being generally considered as reasonable), and (c) involve a competitive process (such as by being provided to at least three reasonably competitive market participants) or by being publicly posted to your official website. In submitting this proposal, we have relied upon your compliance with this guidance.
In submitting this proposal, we are not undertaking to act as a “municipal advisor” to you or any other person within the meaning of the Rules. In connection with this proposal and the transactions described herein, we are not subject to, and we hereby disclaim, any fiduciary duty to you or to any other person. We understand that you will consult with and rely on the advice of your own municipal, financial, tax, legal and other advisors as and to the extent you deem necessary in connection with your evaluation of this proposal and the transactions described herein.
483
Equipment Lease / Schedule of
Property No. 4
(Ladder Truck and Enforcer Type 1)
February 3, 2026
City Council
484
2 Background and Vehicle Needs
•Salinas Fire Department needs two new Pierce Enforcer Type 1 engines, one new Pierce 100’ Enforcer Tractor Drawn Aerial, and a new BME Type 6 engine
•Total financing expected to be about $3.261 million, including financing costs
•City staff utilizing strategies to minimize purchase price of vehicles Example of a Pierce 100’ Enforcer Tractor Drawn Aerial
Example of a Pierce Enforcer Type 1 engine
Vehicle Type Purchase Amount Funding Source
Pierce Enforcer Type 1 1,043,425.32 Cash & Reserves
Pierce Enforcer Type 1 1,043,425.32 2026 Lease
Pierce 100' Enforcer Tractor Drawn Aerial 2,188,980.63 2026 Lease BME Type 6 Wildland Engine 434,251.94 Cash & Reserves
Total Vehicle Cost 4,710,083.21
485
Financing Overview
•City plans to utilize a tax-exempt equipment
lease with Banc of America Public Capital Corp
(BAPCC) to purchase the Tractor Drawn Aerial
and Enforcer Type 1 engine
•Locked, fixed 7-year interest rate of 3.49%
◦ Annual debt service payments of $530K
◦ First payment due December 1, 2026
3 0
100,000
200,000
300,000
400,000
500,000
600,000
Salinas Schedule of Property No. 4
Anticipated Lease Payment Schedule
486
Summary of Legal Documents
4 Authorizing Resolution 2012 MELPA
Schedule of Property
No. 4
Escrow Agreement
487
Anticipated Timing for Equipment Lease
5 Mid December
2025:
Send Bank RFP
Early January
2026:
Bank Bids Due
and Lender
Selected
Mid January
2026:
Finalize
Structure and
Terms
February 3,
2026:
City Council
Considers
Equipment
Lease
Mid February
2026:
Closing and
Funding of
Equipment
Lease
488
Questions?
489
City of Salinas
Legislation Text
200 Lincoln Ave., Salinas,
CA 93901
www.cityofsalinas.org
File #: ID#25-592, Version: 1
Amendment No. 3 to Services Agreement with Smith & Enright Landscaping, Inc. for City-Wide Landscape Services
Approve a Resolution delegating authority to the City Manager to execute Amendment No.3 to the services agreements with Smith & Enright Landscaping, Inc., for City-Wide Landscape Services to increase the annual amount for unscheduled/extra work to $724,180.00 for fiscal year 2025-2026 and $731,452.00 for Fiscal Year 2026-2027, subject to the appropriation of funds.
City of Salinas Printed on 1/29/2026Page 1 of 1
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CITY OF SALINAS
COUNCIL STAFF REPORT
DATE: FEBRUARY 3, 2026
DEPARTMENT: PUBLIC WORKS DEPARTMENT
FROM: DAVID JACOBS, PUBLIC WORKS DIRECTOR
BY: VICTOR BAEZ, DISTRICT/FORESTRY MANAGER
TITLE: AMENDMENT NO. 3 TO SERVICES AGEMENT WITH SMITH
& ENRIGHT LANDSCAPING, INC. FOR CITY-WIDE
LANDSCAPE SERVICES
RECOMMENDED MOTION:
A motion to approve a Resolution delegating authority to the City Manager to execute Amendment No.3 to the services agreements with Smith & Enright Landscaping, Inc., for city-Wide Landscape Services to increase the annual amount for unscheduled/extra work to $724,180.00 for fiscal year 2025-2026 and $731,452.00 for Fiscal Year 2026-2027, subject to the appropriation of funds.
EXECUTIVE SUMMARY:
Amendment No. 3 would increase the amount for unscheduled/extra work under the City -Wide Landscape Services for Greenbelts, Medians & Roundabouts services agreement. This increase is necessary to accommodate current operational needs and would support additional unforeseen projects and interdepartmental landscape services consistent with the Agreement’s scope of work.
BACKGROUND:
The City utilizes a professional landscape service to perform the daily maintenance of greenbelts, medians, and roundabouts, and other miscellaneous landscaping needs.
On June 14, 2022, City Council approved an agreement with Smith & Enright Landscaping, Inc. for City-Wide Landscape Services for Greenbelts, Medians, and Roundabouts in an amount not to exceed $640,251 per year, or $1,920,753 for a three -year term with the option to extend two additional years (Resolution 22387).
On October 8, 2024, the City entered into a First Amendment to the agreement with Smith & Enright to increase the compensation by $204,820 for a revised not to exceed amount of $449,524. 491
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On May 6, 2025, the City entered into a Second Amendment to the agreement with Smith & Enright to extend the term for an additional 2-year period commending on June 14, 2025 through June 14, 2027 and increase the annual not to exceed amounts for FY 2025-26 to $324,180 and FY 2026-27 to $331,452. The existing agreement includes provisions for unscheduled and extra work.
The amount under this contract authorized adjustments as necessary t o address unplanned operational landscape needs and to support additional unforeseen projects and assist with request from interdepartmental landscape service requests, provided such work remains consistent with the scope work defined in the City -Wide Land scape Services for Greenbelts, Medians, and Roundabouts agreement.
Staff recommends that the City Council further amend the Agreement to increase the annual not to exceed amount for unscheduled and extra work from $120,400.00 to $400,000.00. This reflects an increase of $279,600.00 and results in a total not -to-exceed amount of $724,180.00 for Fiscal Year 2025–2026 and not-to-exceed amount of $731,452 for Fiscal Year 2026-2027, subject to the appropriation of funds.
This revised amount provides sufficient capacity to address unplanned and additional work and ensures that any new or unforeseen landscape service requests from other departments may be accommodated under this contract.
CEQA CONSIDERATION:
Not a Project . The City of Salinas has determined that the proposed action is not a project as defined by the California Environmental Quality Act (CEQA) (CEQA Guidelines Section 15378).
In addition, CEQA Guidelines Section 15061 includes the general rule that CEQA applies only to activities which have the po tential for causing a significant effect on the environment. Where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment, the activity is not subject to CEQA. Because the proposed action and this matter have no potential to cause any effect on the environment, or because it falls within a category of activities excluded as projects pursuant to CEQA Guidelines section 15378, this matter is not a project. Because the matter does not cause a direct or foreseeable indirect physical change on or in the environment, this matter is not a project. Any subsequent discretionary projects resulting from this action will be assessed for CEQA applicability.
CALIFORNIA GOVERNMENT CODE §84308 APPLIES:
“Yes”.
STRATEGIC PLAN INITIATIVE:
The City Council’s approval of the proposed amendment to the City-Wide Landscape Services for Greenbelts, Medians, and Roundabouts service agreement unscheduled/extra work relates to City Council’s goal of Improve the condition of the City’s streets and sidewalks through proactive and creative maintenance and strategic infrastructure investments and provide high quality customer service (City of Salinas Strategic Plan 2025-2028).
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DEPARTMENTAL COORDINATION:
This work is coordinated by the Public Work Maintenance Services Department.
FISCAL AND SUSTAINABILITY IMPACT:
The requested amounts below total $201,360.00 and represent additional funding for City departments receiving landscape services. There is currently sufficient budget in each line. These funds are required to pay for services currently being performed and those scheduled for the remainder of the fiscal year. Increasing the unscheduled/extra work authorization to $400,000.00 will provide a contingency of $ $198,640.00 to accommodate future requests for related landscape services from City internal departments.
Fund
General Ledger Number
(Operating/CIP)
General Ledger Account
Name
Remaining Budget
Appropriation
Amount Requested
1200 50.5239-63.6010 Outside Services Other
Outside Services
$54,868.98 $50,000.00
1200 50.5239-63.4900 Outside services-
Maintenance & Repair-
Others
$
$71,939.82
$25,140.00
2401 50.9775-63.6010 Outside services-Other
Outside Service
$50,369.87 $50,000.00
1000 80.8003-63.4100 Outside services-
Maintenance & Repair-
Building & Grounds
$34,194.11 $3,060.00
2107 50.5565-63.4900 Outside services-
Maintenance & Repair-
Others
$6,500.00 $4,000.00
1200 30.9246-63.6010 Outside services-Other
Outside Service
$41,160.00 $41,160.00
6500 50.5443-63.6010 Outside services-Other
Outside Service
$25,000.00 $25,000.00
6200 50.5441-63.6010 Outside services-Other
Outside Service
$3,649.09
$3,000.00
ATTACHMENTS:
Resolution
Amendment No. 3
Amendment No. 2
Amendment No. 1
493
1 RESOLUTION NO. (N.C.S.)
A RESOLUTION OF THE SALINAS CITY COUNCIL AUTHORIZING THE CITY COUNCIL TO ENTER INTO AMENDMENT NO 3 TO AN AGREEMENT FOR SERVICES WITH SMITH & ENRIGHT LANDSCAPING, INC. AND APPROVING AN INCREASE IN UNSCHEDULED/EXTRA WORK COMPENSATION IN THE AMOUNT OF $400,000.00
WHEREAS, the City and Contractor first entered into an agreement for City-Wide Landscape Services for Greenbelts, Medians, and Roundabouts effective June 14, 2022, pursuant to which Contractor agreed to act as and provide certain services to the City for compensation for unscheduled/extra work (the “Agreement”); and
WHEREAS, pursuant to Resolution No. 23121, the City Council approved an increase of $120,400.00 for unscheduled/extra work under the agreement, the reby increasing the not -to- exceed amount to $365,104.00; and
WHEREAS, The Parties now desire to amend the Agreement to increase the amount for unscheduled and extra work by $279,600.00, from $120,400.00 to a total of $400,000.00, thereby increasing the overall Agreement not-to-exceed amount to $724,180.00 for Fiscal Year 2025 –26 and to $731,452.00 for Fiscal Year 2026–27subject to the appropriation of funds; and
WHEREAS, the City and Contractor desire to amend the Agreement to accommodate current operational needs and may support additional unforeseen projects and interdepartmental landscape services requests consistent with the scope of work set forth in the City-Wide Landscape Services for Greenbelts, Medians & Roundabouts Services Agreement.; and
NOW, THEREFORE, BE IT RESOLVED that the City Council authorizes the City Manager to execute Amendment No. 3 to the services a greement with Smith & Enright Landscaping, Inc., for city-wide landscape services to increase the annual amount for unscheduled/ extra work to $724,180.00 for Fiscal Year 2025–2026 and $731,452.00 for Fiscal Year 2026-2027, subject to the appropriation of funds.
PASSED AND APPROVED this 3rd day of February, 2026, by the following vote:
AYES:
NOES:
ABSENT:
ABSTAIN:
APPROVED:
494
2 ______________________________
Dennis Donohue, Mayor
ATTEST:
_________________________
Patricia M. Soratos, City Clerk
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