Cities Index.
Agenda packet

Mayor and City Council
September 17, 2025

Document
Agenda packet
Meeting
September 17, 2025
Body
Mayor and City Council
Pages
14
Original file
147.6 MB
Text extracted from the city's file for reading and search. Open the original on sanbernardino.primegov.com. That file is the official record.

bench of licensed and technical experts consists of specialists in municipal engineering, civil engineering, construction management, construction observation, water resources, highway and roadway engineering, drainage and flood control, structural engineering, traffic and transportation engineering, geotechnical engineering and materials testing/inspection, landscape architecture, environmental planning, building safety, urban and regional planning, and other technical fields. The breadth and diversity of the firm's expertise means our engineering experts can draw upon the considerable experience of the firm - maximizing efficiency, productivity, and quality in meeting project schedules and budgets.
▪ Knowledge of Government Agencies – Willdan’s knowledge of and familiarity with the requirements of Caltrans, County’s Department of Public Works, Department of Housing and Urban Development (HUD), and San Bernardino County Transportation Authority are unmatched. In addition, Willdan is highly experienced in implementing the requirements of the National Pollutant Discharge Elimination System (NPDES) Permit, the Americans with Disabilities Act (ADA), and the Statewide General Waste Discharge Requirements for Sanitary Sewer Systems (WDR).

SCOPE OF WORK
We propose to provide the following general development review services:

1. Attend public meetings such as City Council and Planning Commission, and meetings with City staff, public officials, community leaders, developers, contractors, and the general public.

2. Review and comment on planning programs and land development projects.

3. Review subdivision tentative and final tract maps, parcel maps, boundary adjustments, and legal descriptions for conformance with local and state requirements.

4. Review, check, and approve grading, drainage, and improvement plans for private development.

5. Recommend conditions of approval for development projects.

6. Check improvement plans prepared by private developers for facilities under the jurisdiction of the City.

7. Assist in requesting performance bonds and labor and material bonds for land development projects.

8. Conduct field inspection during construction of improvements by private developers and recommend notices of completion and acceptance of work.

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Willdan will provide the development review services at a fee equal to 60% of the City’s fee collected from the developer. Any additional services will be billed in accordance with the attached Schedule of Hourly Rates.

Please indicate the City’s approval and authorization to proceed by either printing out and signing two originals and returning one hard copy original to our office, or by scanning one signed original and returning it by e-mail.

Thank you for giving us the opportunity to be of service to the City of San Bernardino. If you have any questions, please contact Mr. Adel Freij at (562) 760-7752 or [email protected].

Respectfully submitted, Approval and Authorization to Proceed by:

WILLDAN ENGINEERING CITY OF SAN BERNARDINO
Adel M. Freij, PE
Director - Engineering Signature

Date
Enclosure
910005/WW.00.30/P25-396_27749
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1 EXHIBIT B

TASK ORDER
Task Order No. 2026-002
Agreement: On-Call Professional Services Agreement Between the City of San Bernardino and WILLDAN ENGINEERING
Consultant: WILLDAN ENGINEERING
The Consultant is hereby authorized to perform the following services subject to the provisions of the Agreement identified above:
• Staff Augmentation for Land Development
List of any attachments:

1. Scope of Services

2. On-call Professional Services Agreement between the City of San Bernardino Public Works Department and Wildan Engineering
Dollar Amount of Task Order: Not to exceed $200,000
Completion Date: June 30, 2026
The undersigned Consultant hereby agrees that it will provide all equipment, furnish all materials, except as may be otherwise noted above, and perform all services for the work above specified in accordance with the Agreement identified above and will accept as full payment therefore the amount shown above.

CITY OF SAN BERNARDINO WILLDAN ENGINEERING
Dated: Dated:

By: By:

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September 5, 2025
Ms. Susan Pan, P.E., QSD/QSP
Land Development Manager
City of San Bernardino
201 North E Street, 2nd Floor
San Bernardino, CA 92401
Subject: Proposal to Provide Staff Augmentation Services Dear Ms. Pan:

Willdan Engineering (Willdan) is pleased to submit this proposal to provide the City of San Bernardino with supplemental staffing for land development services. Willdan brings to the City of Bernardino more than 61 years of experience and a record of unmatched service to over 500 public agencies.

Willdan has more than six decades of experience providing a wide range of professional engineering services to local government agencies throughout Southern California and the Western United States. Municipal engineering services include staff augmentation, city engineering, civil and traffic engineering design, water/wastewater engineering, structural design, project management, project approval/environmental design (PA/PE), environmental documentation, right-of-way engineering, utility coordination and relocation design, survey, geotechnical engineering, materials testing, and construction management/inspection. Additional services include State and Federal labor compliance, plan check, encroachment permit issuance/inspection, stormwater/NPDES compliance and implementation, and landscape architectural design. Willdan’s sole focus is on the needs of the public sector, providing us with a thorough understanding of public agency issues and placing Willdan at the top of the list of private consulting firms.

Willdan is uniquely qualified to undertake this important task order assignment for the City of San Bernardino:
▪ Knowledge of the City – Willdan’s familiarity with the City of San Bernardino, combined with our proven experience in staff augmentation, land development plan check and inspection, civil and traffic engineering, construction management and inspection, and building and safety services, positions us to quickly initiate work and effectively address issues as they arise throughout the contract. ▪ Extensive Resources. Willdan has over 350 staff members located in 14 California offices -- over 1,700 employees in 50+ offices nationwide. Our deep bench of licensed and technical experts consists of specialists in municipal engineering, civil engineering, construction management, construction Packet Page. 1240
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observation, water resources, highway and roadway engineering, drainage and flood control, structural engineering, traffic and transportation engineering, geotechnical engineering and materials testing/inspection, landscape architecture, environmental planning, building safety, urban and regional planning, and other technical fields. The breadth and diversity of the firm's expertise means our engineering experts can draw upon the considerable experience of the firm - maximizing efficiency, productivity, and quality in meeting project schedules and budgets.
▪ Grant Writing and Management – Willdan has assisted in obtaining outside funding totaling over $1/2 billion for our clients over the past 2 years. ▪ Knowledge of Government Agencies – Willdan’s knowledge of and familiarity with the requirements of Caltrans, County’s Department of Public Works, Department of Housing and Urban Development (HUD), and San Bernardino County Transportation Authority are unmatched. In addition, Willdan is highly experienced in implementing the requirements of the National Pollutant Discharge Elimination System (NPDES) Permit, the Americans with Disabilities Act (ADA), and the Statewide General Waste Discharge Requirements for Sanitary Sewer Systems (WDR).

SCOPE OF WORK
We propose to provide the following general staff augmentation services:

1. Review and comment on land development projects.

2. Monitor project budgets and schedules.

3. Coordinate with utility companies/agencies and act as City’s representative to facilitate timely construction/relocation of facilities.

4. Review tentative and final tract and parcel maps, site plans, and other submittals for developments and make recommendations.

5. Attend meetings with City staff to provide updates.

6. Review, check, and approve land divisions.

7. Prepare the necessary staff reports and budget document.

8. Provide timely reviews of plans, specifications, and estimates (PS&E).

9. Check contract documents for compliance with Local, State and Federal requirements, as required.

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10. Review insurance, bonds, and other required documents.

11. Provide inspection during construction of the proposed improvements.

Willdan will provide the staff augmentation services per the attached Schedule of Hourly Rates.

Please indicate the City’s approval and authorization to proceed by either printing out and signing two originals and returning one hard copy original to our office, or by scanning one signed original and returning it by e-mail.

Thank you for giving us the opportunity to be of service to the City of San Bernardino. If you have any questions, please contact Mr. Adel Freij at (562) 760-7752 or [email protected].

Respectfully submitted, Approval and Authorization to Proceed by:

WILLDAN ENGINEERING CITY OF SAN BERNARDINO
Adel M. Freij, PE
Director - Engineering Signature

Date
Enclosure
910005/WW.00.30/P25-392R1_27746
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CONSENT CALENDAR
City of San Bernardino
Request for Council Action
Date: September 17, 2025
To: Honorable Mayor and City Council Members
From: Lynn Merrill, Director of Public Works
Department: Public Works
Subject: Approve the Memorandum of Understanding with the San Bernardino Municipal Water Department for the Total Lease Amount Not to Exceed $354,098 for Water Department
Property (Ward 3)
Recommendation:

It is recommended that the Mayor and City Council of the City of San Bernardino, California adopt Resolution 2025-371:

1. Authorizing the City Manager to Execute the Memorandum of Understanding (MOU) with the San Bernardino Municipal Water Department (SBMWD) for the lease of Water Department Property at 333 Chandler Place; and

2. Authorizing the Director of Finance and Management Services to amend the FY 2025/26 Animal Shelter operating budget in the amount of $66,696.00 for the lease of Water Department Property at 333 Chandler Place.

Executive Summary
The City of San Bernardino seeks approval to enter into an agreement with the San Bernardino Municipal Water Department to lease land located directly south of the existing animal shelter at 333 Chandler Place. The lease will provide additional employee parking to accommodate the expansion of animal services and the increase in staff resulting from the City’s Regional Partnership for Animal Services with surrounding cities. The proposed lease area will ensure the animal shelter can continue to serve the public effectively while meeting the operational needs of its growing workforce. For FY 2025/26, the budget will be amended by $66,696 using the General Fund balance. Beginning in FY 2026/27, the annual rent will be budgeted in the Animal Services Fund and transferred to the Sewer Fund. The lease is triple-net with utilities, insurance, and routine maintenance covered by the Animal Services Fund.

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Background
In 2023, Riverside County Animal Services notified the cities that it would no longer provide shelter services after June 30, 2024. In response, the City of San Bernardino worked to establish a regional partnership agreement to provide shelter services to Colton, Fontana, Rialto, Grand Terrace, and Loma Linda, which is now in effect as of July 1, 2024.

On December 6, 2023, The Mayor and City Council adopted Resolution No. 2023-188 Authorizing the City Manager to take the steps necessary to establish a California Nonprofit Public Benefit Corporation to support the Department of Animal Services Programs and Initiatives Regional Partnership for Animal Services.

On April 17, 2024, the Mayor and City Council adopted Resolution No. 2024-067, approving the allocation of $4,000,000 from the General Fund to support necessary improvements and upgrades to the Animal Shelter facility. Following this adoption, the Cities of Colton, Fontana, Grand Terrace, Loma Linda, and Rialto approved the participation agreements with the City of San Bernardino under the regional partnership agreement with an effective date of July 1, 2024.

As outlined in the Partnership Agreement between the City of San Bernardino and the participating cities, the responsibility for the remaining portion of the Maximum Construction Costs, beyond the $4 million paid by the City, is distributed among the partner cities based on a predetermined percentage formula. The City of San Bernardino is responsible for 53.50% of the Participants’ Share, followed by the City of Fontana at 24.00%, the City of Rialto at 14.00%, the City of Colton at 7.00%, the City of Grand Terrace at 1.00%, and the City of Loma Linda at 0.50%. Together, these contributions total 100% of the Participants’ Share of Maximum Construction Costs.

Per the agreement, each city will remain responsible for any increase in costs, in accordance with the percentage they have already agreed to.

On August 7, 2024, the Mayor and City Council adopted Resolution No. 2024-170, authorizing the City Manager to execute a Good Purchase Agreement with Horizon Structures in the amount of $2,096,324 for the acquisition of modular buildings for the Animal Shelter facility. The City of San Bernardino's share of the cost is $1,111,052, with the remaining $985,272 funded through the regional partnership agreement.

The Mayor and City Council also adopted Resolution No. 2024-151 on August 7, 2024, authorizing the City Manager to execute a Good Purchase Agreement with William Scotsman Inc. in the amount of $406,492 for the purchase of a modular office for the Animal Shelter. The City of San Bernardino's share of this cost is $217,745, with $188,747 covered by the regional partnership.

On October 2, 2024, the Mayor and City Council adopted Resolution No. 2024-209, approving the Lease Agreement with Casa Ramona Inc. For 1543 W 8th Street, San Bernardino California, For an Animal Shelter Supportive Services Center with a total yearly lease expense of $216,656.00.

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Currently construction at the San Bernardino Animal Shelter is centered around the installation of twelve (12) modular buildings that will significantly increase the facility’s operational capabilities. The use of modular construction allows for faster deployment, cost efficiency, and flexibility to adapt to future needs as demand for services continues to grow. The modular buildings will significantly increase the total number of kennels and are intended to support the expanded range of services now required due to the recently established Regional Partnership for Animal Services with the Cities of Colton, Fontana, Grand Terrace, Loma Linda, and Rialto.

The City owns and operates the existing animal shelter located at 333 Chandler Place, San Bernardino, CA 92408. With recent proposed expansions to the shelter’s facilities, combined with the hiring of additional staff, all available land within the shelter property has now been fully utilized. This growth has created the need for additional parking spaces to accommodate employees.

In May 2024, City staff met with the Water Department to explore the potential use of a portion of the Water Department’s Water Reclamation Plant (WRP) property as a temporary staff parking facility until a permanent solution could be identified. After a joint evaluation, City and SBMWD staff identified an approximately twenty-seven thousand, seven hundred ninety (27,790) square foot area within the WRP (the “Property”). The site is located directly south of the existing animal shelter, north of West Century Avenue, and east of the Durham School Services bus yard, and was determined to be suitable for temporary parking use.

The intended Property is part of an operational wastewater treatment facility permitted under National Pollutant Discharge Elimination System (NPDES) Permit No.

CA0105392, as well as other regulatory permits. As a result, Water Department staff developed a list of requirements to ensure compliance and operational safety. These requirements have been incorporated into the body and exhibits of the attached Memorandum of Understanding (MOU) that governs the City’s lease of the Property.

Discussion
To facilitate the proposed lease agreement, the Water Department obtained an appraisal of the Property, which was completed on July 29, 2025, by an independent appraiser under contract with the Water Department. The appraisal established the fair market rental value at $0.20 per square foot per month on a triple net (“NNN”) basis.

The Water Department has determined that the Property is not needed for its immediate operational use.

On August 25, 2025, the SBMWD accepted an engineered drawing from the Public Works identifying the planned improvements to be constructed on the Property. The City intends to temporarily develop, construct, and operate an employee parking and dry goods storage area to support the expansion of the animal shelter. The planned improvements include parking, dry goods storage, security fencing, and solarpowered lighting. The City will lease twenty-seven thousand seven hundred and ninety Packet Page. 1307
(27,790) square foot from the SBMWD at $0.20 a square foot for a total amount of $5,558.00 per month and an annual lease amount of $66,696.00.

For FY2025/26, the budget will be amended by $66,696 using the General Fund balance. Beginning in FY 2026/27, the annual rent will be budgeted in the Animal Services Fund and transferred to the Sewer Fund. The lease is triple-net with utilities, insurance, and routine maintenance covered by the Animal Services Fund.

The annual lease will be prorated for any partial year. Beginning on the first anniversary of the Commencement Date, and each year thereafter, the lease rate will increase by three percent (3%) annually. Over the five-year term, this results in a total projected rent obligation of $354,098.12. The table below provides a breakdown of the annual rent amounts, reflecting the scheduled 3% increases.

The City shall have one option to extend the Initial Term for an additional five (5) years.

Unless the City provides written notice to SBMWD of its intent not to exercise the option at least one hundred eighty (180) days before the expiration of the then-current Term, the extension will automatically take effect without further action by either party. 2021-2025 Strategic Targets and Goals
Authorizing the execution of this agreement aligns with the Key Target No. 3: Improved Quality of Life. The lease and parking lot improvements will enable the City to serve the needs of both our residents and their pets while engaging the community to assist the Animal Services Department by volunteering, fostering, and adopting pets from the shelter.

Fiscal Impact
Approval of the MOU with SBMWD establishes a five-year lease (with 3% annual escalation) for 27,790 square feet at the Water Reclamation Plant. Year 1 rent is $66,696, with a total obligation of approximately $354,098 over the full term. For FY Packet Page. 1308
2025/26, the budget will be amended by $66,696 using General Fund balance.

Beginning in FY 2026/27, annual rent will be budgeted in the Animal Services Fund and transferred to the Sewer Fund. The lease is triple-net with utilities, insurance, and routine maintenance covered by the Animal Services Fund.

Conclusion
It is recommended that the Mayor and City Council of the City of San Bernardino, California adopt Resolution 2025-371:

1. Authorizing the City Manager to Execute the Memorandum of Understanding (MOU) with the San Bernardino Municipal Water Department (SBMWD) for the lease of Water Department Property at 333 Chandler Place; and

2. Authorizing the Director of Finance and Management Services to amend the FY 2025/26 Animal Shelter operating budget in the amount of $66,696.00 for the lease of Water Department Property at 333 Chandler Place.

Attachments
Attachment 1 Resolution No. 2025-371
Attachment 2 SBMWD MOU Lease Agreement
Attachment 3 Appraisal Report
Ward:

Third Ward
Synopsis of Previous Council Actions:

December 6, 2023 Mayor and City Council adopted Resolution No. 2023-188 to establish a California Nonprofit Public Benefit Corporation named “The Friends of San Bernardino Animal Services
Foundation” for the Regional Partnership for Animal Services April 17, 2024 Mayor and City Council adopted Resolution No. 2024-067 to Authorize and Appropriate Funding for Animal Services for the preparation of the Regional Partnership Agreements
June 5, 2024 Mayor and City Council adopted Resolution No. 2024-096 to Authorize and Appropriate Funding for Animal Services for the preparation of the Regional Partnership Agreements
August 7, 2024 Mayor and City Council adopted Resolution No. 2024-170 for the Regional Partnership Purchase of Modular Kennel
Buildings for Animal Services with Horizon Structures
August 7, 2024 Mayor and City Council adopted Resolution No. 2024-151 for the Regional Partnership Office Building Purchase for Animal Services with William Scotsman, Inc.

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October 2, 2024 Mayor and City Council adopted Resolution No. 2024-209 approving the Lease Agreement with Casa Ramona, Inc,
regarding 1543 W. 8th Street, for an Interim Animal Shelter Supportive Services Center (Ward 1)
CC: Eric Levitt, City Manager
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Resolution No. 2025-371
Resolution No. 2025-371
September 17, 2025

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RESOLUTION NO. 2025-371

RESOLUTION OF THE MAYOR AND CITY COUNCIL OF

THE CITY OF SAN BERNARDINO, CALIFORNIA,

AUTHORIZING THE CITY MANAGER TO EXECUTE THE

MEMORANDUM OF UNDERSTANDING WITH THE SAN

BERNARDINO MUNICIPAL WATER DEPARTMENT FOR

THE LEASE OF WATER DEPARTMENT PROPERTY AT
333 CHANDLER PLACE; AND AUTHORIZING THE
DIRECTOR OF FINANCE TO AMEND THE FY 2025/26

ANIMAL SHELTER OPERATING BUDGET IN THE
AMOUNT OF $66,696.00 FOR THE LEASE OF WATER
DEPARTMENT PROPERTY AT 333 CHANDLER PLACE.

WHEREAS, by the Charter of the City of San Bernardino, the Council is the highest governing body of the City of San Bernardino with respect to general tax revenues, expenditures, assets, and liabilities, collectively accounted for in the General Fund; and WHEREAS, by the Charter of the City of San Bernardino, the Water Board is the highest governing body of the City of San Bernardino with respect to water utility and sewer utility revenues, expenditures, assets, and liabilities, collectively accounted for in the Water Fund and Sewer Fund, respectively; and
WHEREAS, on April 17, 2024, the Mayor and the City Council adopted Resolution No. 2024-067, approving the allocation of $4,000,000 from the General Fund to support necessary improvements and upgrades to the Animal Shelter facility; and WHEREAS, on August 7, 2024, the Mayor and City Council adopted Resolution No. 2024-170, authorizing the City Manager to execute a Good Purchase Agreement with Horizon Structures in the amount of $2,096,324 for the acquisition of modular buildings for the Animal Shelter facility. The City of San Bernardino's share of the cost is $1,111,052, with the remaining $985,272 funded through the regional partnership agreement; and WHEREAS, on the same date, the Mayor and City Council also adopted Resolution No. 2024-151, authorizing the City Manager to execute a Good Purchase Agreement with William Scotsman Inc. in the amount of $406,492 for the purchase of an additional building for the Animal Shelter. The City of San Bernardino's share of this cost is $217,745, with $188,747 covered by the regional partnership; and
WHEREAS, the Water Board Commissioners of the City of San Bernardino have determined that approximately 27,790 square feet of real property located between Chandler Place and West Century Avenue in the City of San Bernardino, defined hereinafter as the Parking Lot Property with a fair market rental value of Twenty Cents ($0.20) per square foot per month on a triple net (“NNN”) basis as determined by an independent appraisal, is not necessary for use in the immediate future by the San Bernardino Municipal Water Department; and Packet Page. 1311
Resolution No. 2025-371
Resolution No. 2025-371
September 17, 2025

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WHEREAS, the Property is a portion of the Water Reclamation Plant, an operational wastewater treatment facility permitted to treat and dispose of wastewater in compliance with National Pollutant Discharge Elimination System (NPDES) Permit No. CA0105392, among other regulatory permits; and
WHEREAS, the City intends to temporarily use the Parking Lot Property for the development, construction and operation of an employee parking and dry goods storage area serving the existing animal shelter, including but not limited to parking, dry goods storage, security fencing, and solar-powered lighting (“Parking Facilities”); and WHEREAS, the City’s use of the Property for such purpose will necessitate transfers between the General Fund to the Sewer Fund; and
WHEREAS, it has been the practice of the City of San Bernardino to document transfers between the General Fund and Sewer Fund with Memorandums of Understanding between the Council and the Water Board to demonstrate compliance with Proposition 218 (Article XIII D, Section 6 of the Constitution of the State of California).

WHEREAS, the FY 2025/26 Animal Shelter Operating budget requires a supplementation appropriation in the amount of $66,696.00 to fully fund the San Bernardino Animal Shelter lease agreement for the first year.

BE IT RESOLVED BY THE MAYOR AND CITY COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS:

SECTION 1. The above recitals are true and correct and are incorporated herein by this reference.

SECTION 2. The Mayor and City Council hereby authorize the City Manager to execute the Memorandum of Understanding (MOU) with the San Bernardino Municipal Water Department (SBMWD) for the Lease of Water Department Property located at 333 Chandler Place.

SECTION 3. Director of Finance and Management Services to amend the FY 2025/26 Animal Shelter Operating budget with an additional supplementation appropriation in the amount $66,696.00 for the Lease of Water Department Property located at 333 Chandler Place.

SECTION 4. As the decision-making body for the project, the City Council has reviewed and considered the information contained in the administrative record for the proposed project.

Based upon the facts and information contained in the administrative record, including all written and oral evidence presented to the City Council, the City Council finds, as follows:
(1) The administrative record has been completed in compliance with CEQA, the State CEQA Guidelines, and the City's Local CEQA Guidelines.
(2) The proposed project is exempt from the requirements of the California Environmental Quality Act pursuant to Section 15302 (Class II – Replacement or Reconstruction) Packet Page. 1312
Resolution No. 2025-371
Resolution No. 2025-371
September 17, 2025

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of the CEQA Guidelines because it involves the development, construction, and operation of a temporary employee parking lot and dry goods storage area. Additionally, the City Council finds this Resolution is not subject to the California Environmental Quality Act (CEQA) in that the activity is covered by the general rule that CEQA applies only to projects which have the potential for causing a significant effect on the environment. Where it can be seen with certainty, as in this case, 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.
(3) The application of the Class 2 categorical exemption is not barred by one of the exceptions set forth in the CEQA Guidelines Section 15300.2 because this is for the development, construction, and operation of a temporary employee parking lot and dry goods storage area. This does not present any unusual circumstances; would not damage scenic resources, including any resources in the area of a Scenic Highway; would not be utilized on a hazardous waste site; and would not impact historic resources of any kind; and
(4) The determination of CEQA exemption reflects the independent judgment of the City Council.

SECTION 5. Severability. If any provision of this Resolution or the application thereof to any person or circumstance is held invalid, such invalidity shall not affect other provisions or applications, and to this end the provisions of this Resolution are declared to be severable.

SECTION 6. Effective Date. This Resolution shall become effective immediately.

APPROVED and ADOPTED by the City Council and signed by the Mayor and attested by the City Clerk this 17th day of September 2025.

Helen Tran, Mayor
City of San Bernardino
Attest:

Telicia Lopez, Acting City Clerk
Approved as to form:

Sonia Carvalho, City Attorney
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Resolution No. 2025-371
Resolution No. 2025-371
September 17, 2025

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CERTIFICATION

STATE OF CALIFORNIA )
COUNTY OF SAN BERNARDINO) ss

CITY OF SAN BERNARDINO )
I, Telicia Lopez, CMC, Acting City Clerk, hereby certify that the attached is a true copy of Resolution No. 2025-371, adopted at a regular meeting held on the 17th day of September 2025, by the following vote:

Council Members: AYES NAYS ABSTAIN ABSENT
SANCHEZ _____ _____ _______ _______
IBARRA _____ _____ _______ _______
FIGUEROA _____ _____ _______ _______
SHORETT _____ _____ _______ _______
KNAUS _____ _____ _______ _______
FLORES _____ _____ _______ _______
ORTIZ _____ _____ _______ _______
WITNESS my hand and official seal of the City of San Bernardino this ____ day of September 2025.

Telicia Lopez, Acting City Clerk
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MEMORANDUM OF UNDERSTANDING BETWEEN THE COUNCIL AND WATER BOARD REGARDING LEASE OF CERTAIN

PROPERTY
PAGE 1 OF 13

MEMORANDUM OF UNDERSTANDING

REGARDING LEASE OF CERTAIN PROPERTY
This Memorandum of Understanding (“MOU”) is made and entered into this 17th day of September 2025, By and Between:
the Mayor and City Council of the City of San Bernardino (“Council”), acting as the highest governing body of the City of San Bernardino, a charter city, with regards to general government services (the “City”).
and,
the Water Board Commissioners of the City of San Bernardino (“Water Board”), acting as the highest governing body of the San Bernardino Municipal Water Department, a department of the City of San Bernardino created by the Charter of the City of San Bernardino (the “Water Department”, “Lessor”) (individually the City and Water Department may be referred to as a “Party” and collectively the City and Water Department may be referred to as the “Parties”).

RECITALS:

WHEREAS, by the Charter of the City of San Bernardino, the Council is the highest governing body of the City of San Bernardino with respect to general tax revenues, expenditures, assets, and liabilities, collectively accounted for in the General Fund; and,
WHEREAS, by the Charter of the City of San Bernardino, the Water Board is the highest governing body of the City of San Bernardino with respect to water utility and sewer utility revenues, expenditures, assets, and liabilities, collectively accounted for in the Sewer Fund, respectively; and WHEREAS, the Water Board Commissioners of the City of San Bernardino have determined that approximately 27,790 square feet of real property located between Chandler Place and West Century Avenue in the City of San Bernardino, defined hereinafter as the Parking Lot Property with a fair market rental value of Twenty Cents ($0.20) per square foot per month on a triple net (“NNN”) basis as determined by an independent appraisal, is not necessary for use in the immediate future by the San Bernardino Municipal Water Department; and
WHEREAS, the Property is a portion of the Water Reclamation Plant, an operational wastewater treatment facility permitted to treat and dispose of wastewater in compliance with National Pollutant Discharge Elimination System (NPDES) Permit No. CA0105392, among other regulatory permits; and WHEREAS, the City intends to temporarily use the Parking Lot Property for the development, construction and operation of an employee parking and dry goods storage area serving the existing animal shelter, including but not limited to parking, dry goods storage, security fencing, and solar-powered lighting (“Parking Facilities”); and
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MEMORANDUM OF UNDERSTANDING BETWEEN THE COUNCIL AND WATER BOARD REGARDING LEASE OF CERTAIN

PROPERTY
PAGE 2 OF 13
WHEREAS, the City’s use of the Property for such purpose will necessitate transfers between the General Fund to the Sewer Fund; and,
WHEREAS, it has been the practice of the City of San Bernardino to document transfers between the General Fund and Sewer Fund with Memorandums of Understanding between the Council and the Water Board to demonstrate compliance with Proposition 218 (Article XIII D, Section 6 of the Constitution of the State of California).

NOW, THEREFORE, the Parties agree as follows:

1. RECITALS. The recitals set forth in “RECITALS” are, by this reference, incorporated into and deemed a part of this MOU.

2. RESOLUTION. The Parties shall execute resolutions memorializing the following:
a. The Water Board shall, by resolution, temporarily allow the use of certain real property and improvements comprising approximately 27,790 square feet of public facilities land that is a portion of the larger parcel known as APN 0141-291-23, more particularly described in Exhibit “A” attached hereto and incorporated herein by this reference as though set forth in full (the “Parking Lot Property”).
b. The Council shall, by resolution, approve annual transfers from the General Fund to the Sewer Fund in the amount of $66,696.00 (the “Annual Rent”), subject to annual escalation as provided for in Section 5 below.
c. The Water Board accepts the Annual Rent from the General Fund to the Sewer Fund. d. Subcontracts, if any, shall contain a provision making them subject to all of the provisions stipulated in this MOU. With respect to any conflict between such federal requirements and the terms of this MOU and/or the provisions of state law and except as otherwise required under federal law or regulation, the more stringent requirement shall control.

3. TERM. The initial term of this MOU (the “Initial Term”) shall commence on the date the Resolution is approved by the Parties respective governing boards (“Commencement Date”) and shall expire on the fifth (5th) anniversary of the Commencement Date (“Expiration Date”), unless sooner terminated as provided herein.

4. EXTENDED TERM. The City shall have one option to extend the Initial Term for an additional five (5) year period (an “Extended Term”). The Initial Term and the exercised Extended Term may be collectively referred to herein as the “Term.” The option to extend will be deemed to be exercised immediately prior to the expiration of the then current Term without any action by Water Department or City, unless City provides prior written notice to Water Department of City’s intention not to extend the Term no later than one hundred eighty (180) days prior to the expiration of the then current Term.

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5. ANNUAL RENT. Commencing on the Commencement Date, City transfer to Water Department, on the first business day of each year during the Term, the Annual Rent. Annual Rent shall be prorated for any partial year. Commencing on the first anniversary of the Commencement Date and continuing annually, the Annual Rent shall increase by three percent (3%).

6. USE AND OCCUPANCY.
a. Use. Subject to the terms of this MOU and all matters of public record, City may use and occupy the Parking Lot Property for the design, planning, development, construction, installation, ownership, operation, maintenance, repair, inspection, security, and replacement of the Parking Facilities. The Parking Facilities shall be used by City solely as motor vehicle parking and dry goods storage for the City’s existing animal shelter and purpose(s) incidental thereto. Animals, whether living or deceased, shall not be permitted to be kept, held, or stored on the Parking Facility for any duration. Generators powered by internal combustion engine and greater than 49 horsepower are not permitted to be operated or stored on the Property.
b. Design and Construction. City will have control over the planning, configuration, design, engineering, development, commissioning, construction, ownership, management, operation and maintenance of the Parking Facilities, with the assistance of such contractors, subcontractors and consultants as City may designate, all in its sole discretion; but subject to Lessor’s rights to review and approve (which approval shall not be unreasonably withheld, conditioned or delayed) as set forth herein. City and Lessor agree that the Parking Facilities shall be a surface parking lot, a security gate for access, and solarpowered lighting. Upon completion of City’s work, City shall provide to Lessor a complete set of construction drawings and “as built” plans for the Parking Facilities. c. The Parties acknowledge and agree that prior to execution of the resolutions and this MOU, the Water Department has permitted City to begin construction activities on the Property.

In connection with those activities, City has agreed to certain covenants regarding construction standards and obligations and provided certain deliverables to Water Department as set forth in Exhibit B attached hereto (the “City Construction Covenants”). d. Maintenance. Throughout the term of this MOU, City shall maintain the Property in a clean and sanitary condition with Parking Facilities in good working order and repair. The Parking Facilities shall be kept free of weeds and wind-blown dust or debris at all times.

City shall take reasonable measures to prevent and minimize fugitive dust emissions and trackout that may arise from the construction, use or maintenance of the Parking Facilities.

7. COMPLIANCE WITH LAWS. During the Term, City shall comply with Applicable Law (including, without limitation, Environmental Laws) (“Requirements”) applicable to the Premises in all material respects. City may, after prior written notice to Lessor, contest by appropriate legal proceedings (which must be conducted by City diligently and in good faith without cost or expense to Lessor) the validity or applicability of any Requirement affecting the Premises and Lessor shall reasonably cooperate with City in connection therewith. City shall immediately notify Lessor of any notice it receives respecting any violation of any Applicable Law regarding the Premises, and shall require its subtenants to notify City of the same. City shall not conduct or permit to be conducted any private or public nuisance on or about the Premises, nor commit any physical waste thereon. “Applicable Law” means any federal, state, or local statute, law, municipal charter Packet Page. 1317

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provision, regulation, ordinance, rule, mandate, judgment, order, decree, permit, code, or license requirement or other governmental requirement, standard, or restriction, or any interpretation or administration of any of the foregoing by any agency, court, or other Governmental Entity, that applies to the rights or obligations of either Party under this MOU. “Governmental Entity” means any court, arbitrator, federal, state or local government agency, regulatory body, or other governmental authority or other entity granted authority by a governmental authority to enact, enforce or interpret laws, rules and/or regulations.

8. UTILITIES. Commencing on the Commencement Date, City shall timely pay prior to delinquency for all water, gas, heat, light, power, telephone and other utilities and services supplied to the Premises together with any taxes thereon. Throughout the term of this MOU, City shall promptly execute and deliver to Lessor after Lessor’s request therefore, and shall require in any sublease that any sublessee execute and deliver, any utility or other authorization or document reasonably necessary for Lessor to comply with California’s Energy Use Program or any other energy efficiency or similar program required by any governmental agency.

9. INSURANCE. During the Term, City shall obtain and maintain the following policies of insurance or self-insurance:
a. all-risk property insurance against fire, theft, vandalism, malicious mischief, sprinkler leakage and such additional perils as now are or hereafter may be included in Special Form (All Risk) Coverage in general use in the State of California, insuring the Premises in an amount equal to one hundred percent (100%) of the replacement cost thereof; b. a commercial general liability policy, including insurance naming Lessor, as an additional insured, protecting against any and all claims for injury to persons or property occurring in or about the Premises and protecting against assumed or contractual liability under this MOU with respect to the Premises and the operations of City, and anyone holding through City, in, on or about the Premises, with such policy to be on an “occurrence basis” in the minimum amount of One Million Dollars ($1,000,000.00) combined single limit coverage with a general aggregate of such coverage not less than Three Million Dollars ($3,000,000.00);
c. With respect to the City’s or any subleases business operations on the Premises, worker’s compensation insurance as required by law and employer’s liability insurance with limits no less than One Million Dollars ($1,000,000.00);
d. Prior to commencing any construction activities within the Property whose work costs greater than $10,000.00, City shall obtain or require its contractor to obtain and thereafter maintain so long as such construction activity is occurring, at least the minimum insurance coverages set forth below:

1. Workers’ Compensation at statutory limits;

2. Employers’ Liability $1,000,000;

3. Builder’s Risk in the amount equal to the contract cost for the work;

4. Commercial General Liability and Business Auto Liability as follows:
a. Bodily Injury - $1,000,000 per occurrence;
b. Property Damage - $1,000,000 per occurrence;
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e. Certificates of insurance evidencing all such insurance and acceptable to the Lessor shall be filed with Lessor prior to occupancy of the Premises. Such certificates of insurance must specifically show all the special policy conditions required in this paragraph, including “additional insured,” “waiver of subrogation,” “notice of cancellation,” and “primary insurance” wording applicable to each policy. Alternatively, a certified, true and complete copy of each properly endorsed policy may be submitted. All policies shall contain an undertaking by the insurers to notify Lessor in writing not less than thirty (30) days prior to any material change, reduction in coverage, cancellation, or other termination thereof.

City shall furnish Lessor with proof of renewal or binders for new insurance at least thirty (30) days before the expiration date of each policy.

10. INDEMNIFICATION.
a. Indemnification of Water Department. Except to the extent arising or resulting from the negligence or willful misconduct of Lessor or any of its agents, employees, vendors, or contractors, City shall indemnify, defend and hold harmless Lessor from and against all claims, costs, including reasonable attorney’s fees and costs, expenses and liabilities (collectively, “Losses”) to the extent arising or resulting in any manner whatsoever from (a) City’s (and anyone holding or acting through City’s) use and enjoyment of and interest in the Premises, (b) any breach or default in the performance of any obligation on City’s part to be performed under the terms of this MOU, or (c) any negligence or willful misconduct of City (and anyone holding or acting through City) resulting in any damage or harm to Lessor or the Property.
b. Indemnification of City. Except to the extent arising or resulting from the negligence or willful misconduct of City or any of its agents, employees, vendors, or contractors, Lessor shall indemnify, defend and hold harmless City from and against all Losses to the extent arising or resulting in any manner whatsoever from (a) Lessor’s (and anyone holding or acting through Lessor’s) use and enjoyment of and interest in the Property, (b) any breach or default of the representations and warranties contained herein or in the performance of any obligation on Lessor’s part to be performed under the terms of this MOU, or (c) any negligence or willful misconduct of Lessor (and anyone holding or acting through Lessor) resulting in any damage or harm to City or the Premises. c. Survival and Insurance. All obligations of the Parties hereto to indemnify and defend the other as set forth in this MOU, shall survive termination of this MOU. The provisions of this Section shall not be construed so as to relieve any insurer of its obligations to pay any insurance claims in accordance with the provisions of any valid insurance policy.

11. SURVIVAL. Upon the expiration or earlier termination of this MOU, City shall quit and surrender the Premises in its “as-is” condition, broom clean with all personal property removed. City shall have no right to hold over following the expiration of the Term except with the prior written consent of Lessor. City’s improvements which remain on the Premises following the expiration or the earlier termination of this MOU shall, at Lessor’s election, be deemed to have been surrendered to Lessor.

12. DEFAULTS AND REMEDIES.

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a. Defaults. Each of the following events shall be a default by City and a breach of this MOU, and shall constitute an “Event of Default” hereunder: (i) abandonment of the Premises, the Parking Facilities or any other improvements hereafter constructed thereon, where such abandonment continues for a period of thirty (30) consecutive days after notice thereof by Lessor to City; (ii) the subjection of any right or interest of City in the Premises to attachment, execution or other levy, or to seizure under legal process, if not released within ninety (90) days; (iii) City’s violation of the use restrictions set forth herein; (iv) failure of City to observe or perform any of its covenants, conditions or agreements under this MOU; or (v) such other events of default as are set forth under the terms this MOU. b. Notice and Right to Cure. If the alleged default is monetary in nature, Lessor shall deliver written notice to City of the default and City will have ten (10) days after the receipt of such written notice to cure the default. As to any other non-monetary defaults, except as otherwise provided herein, City shall have thirty (30) days after written notice is given by Lessor specifying the nature of the default to cure the default; provided, however, that if after exercise of due diligence and its best efforts to cure such non-monetary default City is unable to do so within the thirty (30) day period, then the curing period shall be extended for such reasonable time as may be necessary for curing such default, so long as City continues to diligently prosecute to completion the curing of the default. As used herein, non-monetary defaults shall include, without limitation, a breach of any covenant of City hereunder, City’s failure to perform as required hereunder, and a breach of any warranty, representation or other agreement of City under this MOU. c. Remedies. If any Event of Default by City shall continue uncured upon expiration of the applicable curing period, Lessor may, at Lessor’s election, terminate this MOU upon notice to City. All of City’s rights in the Premises, the Parking Facilities and all other improvements thereon shall terminate upon termination of this MOU. Promptly after any such termination, City shall surrender and vacate the Premises and Lessor may re-enter and take possession of the Premises and all such improvements. Termination under this Section shall not relieve City from the payment of any rent then due, or from any claim for damages previously accrued, or then accruing, against City.

13. ASSIGNMENT. Without Water Department’s written consent, which shall not be unreasonably withheld, City shall not assign or hypothecate this MOU or any interest herein or sublet the Premises or any part thereof, or permit the use of the Premises by any party other than for the use permitted herein.

14. CASUALTY. If the Premises, or any part thereof shall be destroyed or damaged at any time during the Term, to the extent that, in City’s reasonable opinion, it would take more than nine (9) months to complete the necessary repairs or rebuilding to the Parking Facilities after the date of damage, or the continued construction or operation of the Parking Facilities has been rendered impractical in the opinion of City, then City shall have the right to terminate this MOU upon written notice to Lessor within sixty (60) days after the date of such damage or destruction. If City decides to repair or rebuild the Parking Facilities or fails to give notice of termination within such sixty (60) day period then (a) City shall repair, alter, restore, replace or rebuild the Parking Facilities to the condition existing prior to such damage or destruction (or with such changes thereto as may be elected by City (and subject to the terms of this MOU)), provided that all such restoration work shall be performed in accordance with the terms and conditions of this MOU, and (b) if the cost to so rebuild or reconstruct shall exceed the proceeds of any insurance, City shall be liable for any Packet Page. 1320

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such deficit. If, however, the proceeds of any insurance covering such damage or destruction exceed the cost of repair or reconstruction, such excess shall belong to City. All such repair, restoration or rebuilding required under this Section shall be commenced within six (6) months after the occurrence of the casualty and receipt of all permits and approvals (which City shall diligently pursue obtaining) and performed with due diligence in a good and workmanlike manner and in accordance with all applicable Laws.

15. ENVIRONMENTAL CONDITIONS.
a. Prohibited Uses. No adverse environmental condition in violation of Environmental Laws shall be permitted to exist on any portion of the Premises, nor shall any Hazardous Substance (as defined below) be permitted to be disposed of, or otherwise deposited in or on or allowed to emanate from the Premises, including, without limitation, into the surface of any waters and subsurface waters thereof, by City or its agents or employees in violation of Environmental Laws (defined below). Throughout the term of this MOU, City shall be obligated to comply with all Environmental Laws with respect to (a) the use, enjoyment or occupancy of the Premises, or (b) the presence of any Hazardous Substance on the Premises, except with respect to: (i) any Hazardous Substances present on or under the Premises prior to the Commencement Date; (ii) any Hazardous Substances brought onto the Premises by Water Department or any of Water Department’s agents, employees, or contractors; and (iii) any Hazardous Substances that migrate onto the Premises during the Term. Hazardous Substances may be transported to and from the Premises, and stored, generated, used and disposed of at the Premises by City and its agents and employees, so long as such transport, storage, generation, use and disposal is (i) ancillary to the ordinary course of business of an otherwise permitted use hereunder with the intent that such substances will be used in the ordinary course of business, and (ii) conducted in full compliance with all Environmental Laws. City covenants that it shall use the Property for the Parking Facilities only.
b. Definitions.
i. “Environmental Laws” means any and all applicable laws and authorizations issued, promulgated or entered into by any Governmental Entity relating to the environment, preservation or reclamation of natural resources, or to the management, handling, use, generation, treatment, storage, transportation, disposal, manufacture, distribution, formulation, packaging, labeling, release or threatened Release of or exposure to Hazardous Substances, whether now existing or subsequently amended or enacted, including but not limited to: the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. Section 9601 et seq. (“CERCLA”); the Federal Water Pollution Control Act, 33 U.S.C. Section 1251 et seq.; the Clean Air Act, 42 U.S.C. Section 7401 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Emergency Planning and Community Right to Know Act of 1986, 42 U.S.C.

Section 11001 et seq.; the Safe Drinking Water Act, 42 U.S.C. Section 300(f) et seq.; the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801 et seq.; the Federal Insecticide, Fungicide and Rodenticide Act 7 U.S.C. Section 136 et seq.; the Resource Conservation and Recovery Act of 1976 (“RCRA”), 42 U.S.C.

Section 6901 et seq.; the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq.; the Oil Pollution Act of 1990, 33 U.S.C. Section 2701 et seq.; and any similar Packet Page. 1321

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or implementing federal, state or local law, and all amendments or regulations promulgated thereunder; and any common law doctrine, including but not limited to, negligence, nuisance, trespass, personal injury, or property damage related to or arising out of the presence, release, or exposure to Hazardous Substances.
ii. “Hazardous Substances” means all explosive or regulated radioactive materials or substances, hazardous or toxic materials, wastes or chemicals, petroleum and petroleum products (including crude oil or any fraction thereof), asbestos or asbestos containing materials, and all other materials, chemicals or substances which are regulated by, form the basis of liability or are defined as hazardous, extremely hazardous, toxic or words of similar import, under any Environmental Law.

16. MISCELLANEOUS.
a. Entire Agreement; Construction. All understandings and agreements between the Parties regarding the Premises, whether oral or written, are merged into this MOU and the Exhibits and Schedules hereto, which alone fully and completely expresses their understanding and supersedes all prior understandings, agreements, arrangements and representations between the Parties with respect to the Premises.
b. Further Assurances. If either Lessor or City reasonably determines that any further instruments or any other acts are necessary or desirable to carry out the terms of this MOU, including any documents necessary for City to construct the Parking Facilities, the other Party will promptly execute and deliver all such instruments and assurances and do all things reasonably necessary and proper to carry out the terms of this MOU. c. Waiver. The failure of either Party hereto to enforce at any time any of the provisions of this MOU or to exercise any right which is herein provided will in no way be construed to be a waiver of such provision nor in any way to affect the validity of this MOU or any part thereof or the right of either Party to enforce thereafter each and every such provision and to exercise any such right. No waiver of any breach of this MOU will be held to be a waiver of any other or subsequent breach. Nothing will constitute, or have the effect of, a waiver except an instrument in writing signed by a duly authorized officer or representative of the Party against whom such waiver is sought to be enforced which expressly, and not impliedly, waives a right or rights under this MOU.
d. Notices. Except as otherwise provided herein, all notices required or permitted to be given under this MOU must be in writing and addressed to the Party to whom it was sent at the address of such Party set forth below or at such other address as the Party may subsequently designate to the other by notice given in accordance with this Section, provided, Lessor and City may only change to a street address that allows for personal delivery. Notices shall be delivered by hand delivery or electronic mail or letter. Notice by hand delivery or electronic mail shall be deemed to have been received by the close of the business day on which it was hand delivered (unless hand delivered or emailed after close of business in which case it shall be deemed received at the close of the next business day). Notice by overnight mail or courier shall be deemed to have been received one (1) business day after it was sent.

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If to Water Department:

San Bernardino Municipal Water Department
1350 South E Street
San Bernardino, CA 92408
Attn: Miguel Guerrero, General Manager
Email: [email protected]
If to City:

City of San Bernardino
290 North D Street
San Bernardino, CA 92401
Attn: Eric Levitt, City Manager
Email: [email protected]
[Signature Page Follows]
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MEMORANDUM OF UNDERSTANDING BETWEEN THE COUNCIL AND WATER BOARD REGARDING LEASE OF CERTAIN

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MEMORANDUM OF UNDERSTANDING

REGARDING LEASE OF CERTAIN PROPERTY
By and between the Mayor and Council of the City of San Bernardino and the Water Board of the City of San Bernardino for the lease of certain property.

Date: ______________________
Date: ______________________
APPROVED AS TO FORM:

By: ________________________________
City Attorney

MAYOR AND COUNCIL OF THE
CITY OF SAN BERNARDINO:

By: ________________________________
Eric Levitt, City Manager

WATER BOARD OF THE
CITY OF SAN BERNARDINO:

By: ________________________________
Miguel J. Guerrero, General Manager
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Exhibit “A”
Parking Lot Property
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Exhibit “B”
City Construction Covenants

1. Drawings / Plans
a. City to provide a copy of its construction-quality drawings and/or plans that adequately identify proposed installations.
b. City to provide proof of contractor insurance documents for this project. c. City to provide draft, final, and list of pending environmental/regulatory documents.

2. Stormwater requirements
a. City to be responsible for meeting any stormwater quality requirements for runoff from the Property.
b. City shall extend the existing concrete curb on the east side of the proposed parking area to the asphalt curb on the west side of the proposed parking area, with the fifteen (15) foot clear distance to the water system on the south side such that any water runoff from the parking area does not flow to the SBMWD Sampling Point S-001. c. City shall perform routine maintenance on the existing drainage area on the westernmost edge of the Property that transmits runoff from 333 Chandler Place and 397 Chandler Place to West Century Ave.

3. Buried Perimeter Intrusion Detection System (PIDS)
a. City to follow the specific requirements for protecting the shallow, expensive, sensitive buried PIDS.
b. City to submit any changed plans to Water Department for approval. c. Both crossings of the PIDS line will be covered with a traffic-rated trench plate that is secured from sliding or concrete slab with appropriate reinforcement to prevent loading on the uncompactable sand layer surrounding the buried PIDS. d. K-rail or other form of barrier that is not easily moved to be placed at least 3 feet from the PIDS line. PIDS line will be located with a minimum of two (2) business days’ notice for City upon request by SBMWD staff. K-rail, if used, does not need to be CalTrans rated.

4. Fencing
a. North/South fence line on the east side of the parking lot to be aligned parallel to and west of the existing curb face.
b. East/West fence line on the south side of the parking lot to be aligned such that a minimum of fifteen (15) foot clear distance exists from the potable water connection piping near the Century Gate.
c. Double-panel gate adjacent to the bus yards may be used by City, so long as a continuous fence line blocks access into the WRP.
d. The asphalt curb near the double-panel gate may be cut and removed, so long as the nearby PIDS line is not disturbed.
e. Temporary and final fencing shall be of a secure type equal to or exceeding the 6' chain link with razor wire (top and bottom) that surrounds the animal shelter and WRP.

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f. A stop sign shall be placed at the Century Ave gate to reduce vehicle conflicts with vehicles exiting the WRP.
g. Fencing shall be kept in place in a continuous perimeter at all times. At no point shall the fence be allowed to remain unclosed and the WRP unsecure.

5. Security Access List for WRP
a. Adhere to Water Department’s security specifications.

6. WRP Liaison
a. City to include Kevin Stewart (Water Reclamation Director) and Travis Mendenhall (Water Reclamation Superintendent) on all project communications. b. City to include WRP liaison in construction meetings with its contractor.

7. Clean Stone
a. If City intends to pave the Property with an aggregate, City to ensure use of a clean, fresh, natural stone that is not recycled, nor does it contain unnatural metals. These materials warrant a problem with stormwater runoff.

8. Palm Tree
a. Base of palm tree shall not be excavated.
b. Any disturbance of the tree shall be approved by E&RC Director in compliance with any biological needs (bird nests).

9. Grading
a. City shall be aware that the County Fire Department performed trench rescue training in the applicable area over many years. This involved multiple excavations of up to 10 feet in depth with uncompacted backfill. These areas were pointed out during previous meetings. The holes have been backfilled for over a year and may be sufficiently compacted to support a gravel parking lot.

10. Area Restoration
a. The area shall be restored to its current condition or better at the completion of the lease.

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1 Appraisal Report Prepared on
40,716 SF of PF (Public Facilities) Zoned Land That Is A Portion Of Larger 32.08-Acre Parcel APN 0141-291-23, in San Bernardino, California 92408
Prepared for:

Sydney Morrison – Contracts Administrator
City of San Bernardino Municipal Water Department
Effective Date of Value: July 21, 2025
Date of Report: July 29, 2025
Prepared by:

Steven R. Smith, MSREA, MAI, SRA
And Benjamin Castro
[email protected]
909 856 6841
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2 Steven R. Smith, MSREA, MAI, SRA
• Real Estate Consultants • Market Studies • Risk Analysis • Appraisals • 800 Community College #114, San Jacinto, CA 92583
909-856-6841, [email protected]
7/20/25
Purpose: The purpose of the appraisal is to estimate the as-is value of the fee simple estate in the subject property and it rental potential.

Intended Use/Client and Intended Users: The intended use of this appraisal report is to provide asset value to our clients for the purpose of a land exchange transaction, as it relates to the subject property. Our client, the intended user of this report, is the City of San Bernardino Municipal Water Department. This report may not be used for any other purpose than expressed above, nor by any other party, than to whom it is addressed, and the appraisers specifically disclaim any liability to such unauthorized third parties.

Scope of Work:The scope of work included a full inspection of the subject property; research into the market conditions and market data using CoStar, Loopnet, the Multiple Listing Services (MLS), and broker and market participant interviews; and analysis of the data and preparation of the report.

Client: The City of San Bernardino Municipal Water Department Property Rights Appraised: The unencumbered fee simple ownership interest.

As-Is Effective Date of Value: July 18, 2025
Concluded As-Is Market Value-Fee Simple Estate $1,060,000 Concluded Market Rental Value: $0.20 per square foot per month, on a NNN basis or $97,700 per year.

Respectfully submitted,

Steven R. Smith, MSREA, MAI, SRA,
AG 2123, expires 7/20/25
Benjamin Castro, Certified General Appraiser
AG 040398, expires 8/30/2027

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3 Table of Contents
THE INTRODUCTION.......................................................................................................................................4 THE LOCATION.............................................................................................................................................11 LAND DESCRIPTION......................................................................................................................................12 HIGHEST AND BEST USE ...............................................................................................................................15 THE SALES COMPARISON APPROACH ...........................................................................................................18 COMMENTS ON INDUSTRIAL LAND COMPARABLES.......................................................................................22 RECONCILIATION .........................................................................................................................................23 SUPPLEMENTAL MARKET RENT AND NET OPERATING INCOME .....................................................................24 DEFINITIONS / ASSUMPTIONS / LIMITING CONDITIONS ................................................................................26 ASSUMPTIONS AND LIMITING CONDITIONS..................................................................................................28 APPRAISER’S CERTIFICATIONS ......................................................................................................................29 Packet Page. 1330
4 THE INTRODUCTION

SUBJECT OCCUPANCY
The 0.93-acre portion of the subject’s larger 32.08-Acre property being appraised (see hypothetical condition section) is currently vacant, unimproved land.

CURRENT OWNERSHIP / PROPERTY HISTORY
According to our review of public records, title to the subject parcel is currently vested in the City of San Bernardino. Per the property contact interview, the subject is not currently listed for sale or lease, and is not in escrow to be purchased. No additional transfers of the subject title are known to have occurred during the past three years.

PROPERTY DESCRIPTION
The subject
property is a
40,716 SF
unimproved,
rectangular
shaped portion
of a larger 32.08-
Acre parcel
centrally located
along the west
elevation of the
lot line.

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6 Packet Page. 1333
7 MARKET AND EXPOSURE TIME
Typically, exposure period is the amount of time the real property interest being appraised would have been offered on the market prior to the hypothetical consummation of a sale at market value on the effective date of the appraisal. Marketing period is an opinion of the amount of time it might take to sell the real property interest after the effective date of the appraisal.

Sales of similar type properties, including the sale comparables used in this report, were analyzed and had a wide range of exposure periods. According to knowledgeable professionals, the marketing time for properties like the subject varies considerably. According to interviews with brokers and market participants involved in these transactions, an adequate exposure for the subject would be approximately six to nine months - if properly priced and marketed.

Based on our findings, we believe an exposure and marketing time of six to nine months for the subject property is considered reasonable and appropriate.

MARKET TRENDS AND BROKER INTERVIEWS
Market trends for the industrial land market are based on recorded industrial zoned land sales in the city of San Bernardino from July 2023 to the present, excluding all non-arm’s length transactions. Our search uncovered 18 closed sales that are summarized in the tables that follow.

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8 Packet Page. 1335
9 ASSESSED VALUATION AND TAXES:

In California, government-owned property is generally not subject to property taxes. The general exemption from local, state, and federal taxes for government owned property is based on the idea that the sovereign shouldn’t tax itself.

In general, the assessment of market value is limited to a maximum increase of two percent per year, unless the property is transferred or there is substantial new construction.

Proposition 13 typically requires reassessment of real property upon a change of ownership. In either event, the property is re-appraised to current market value, usually as evidenced by the sale price or the construction costs.

Assessed value is generally not considered an accurate reflection of market value, as it is not particularly sensitive to economic fluctuations affecting the property. If the estimate of market value is higher than the sale price, then Proposition 8 provides for the reassessment of real property due to a decline in market value. A property owner must petition for a reassessment in order to lower property taxes or receive a tax refund. If the owner disputes the reassessed value, an appeals procedure is in place for a more detailed reassessment of market value in accordance with Proposition 8.

Broker Interviews
Brokers were interviewed and/or information furnished from firms active in the subject’s market area. The interviews are as follows:

Michael Rademaker, MGR Realty. Mr. Rademaker is the founder of MGR Realty and has over 30 years of experience buying and leasing commercial properties throughout Southern California. He stated land sales have slowed and redevelopment projects have been delayed as investors wait and see where interest rates are headed. High borrowing and construction costs, combined with higher vacancy rates and lower demand, have made it financially unfeasible to develop a parcel to satisfy an investor’s return expectations. Additionally, he states the most likely buyer for the subject parcel would be an owner-user whose motivation would be the location and utility of the site, rather than any type of cap rate consideration.

Robert Kirkpatrick, SVN. Mr. Kirkpatrick has over 50 years of experience in the Southern California real estate market. He remains optimistic that the market will rebound in the next two or three quarters if interest rates remain where they are at or decrease. Still, marketing times have increased, and concessions, including free rent and significant tenant improvement allowances, remain prevalent in order to close leases in the submarket.

Art Sanchez, Sanchez Realty: Mr. Sanchez specializes in commercial and industrial properties throughout the Inland Empire. He has seen both investors and owner-users attracted to the Inland Empire as an alternative to the pricier Los Angeles and Orange County industrial markets, as owner-operators continue moving further from more established markets due to Packet Page. 1336
10 newer restrictions and development moratoriums placed in those cities for certain businesses.

He remains optimistic about the long term prospects for the industrial and commercial markets in this area, based on the number of planned industrial projects that have been approved for future development in the area.

Mark Kegans, SIOR, Executive Managing Director, Newmark. Mr. Kegans is familiar with the subject property and has exclusively worked the Industrial/Development segment of the Inland Empire for over 35 years. He believes the subject has an ideal location and size for an entrepreneur rather than an institutional investor due to its smaller size and location. The type of use and development that would result in the highest value would be industrial or lightindustrial, in his opinion. The market is currently bearish, with marketing times increasing for all property types, he explained. Additionally, he notes the reluctance of city planning departments to approve any new industrial projects.

Hector Benavidez, Keller Williams: Mr. Benavidez is the listing broker for Sale No. 6, which is currently in escrow. He has seen tremendous price appreciation for industrial zoned vacant land within the past several years, from both owner-users and investors. The recent trend has been for owner-users to acquire adjoining lots for plottage value, as premiums are being paid for larger lots that have more gated yard space for storage and truck/service vehicle parking.

The consensus opinion of other brokers and market participants we have interviewed for this assignment and previous assignments, is that there are many factors affecting the price both investors and owner-users are willing to pay for a parcel of land, with factors such as submarket location and surrounding development; lot shape/size/utility; egress/ingress (corner or interior parcel); topography; freeway proximity and exposure along primary arterials; and approvals or entitlements.

HYPOTHETICAL CONDITION / EXTRAORDINARY ASSUMPTIONS
This report utilizes the following two hypothetical conditions to reach our supportable opinion of the subject property’s market value. Our client has engaged us to value the fee simple rights of a +/- 0.93-acre (40,716 SF) portion of a larger 32.08-acre parcel, for which we must utilize the hypothetical condition that the portion of the subject property being appraised has already been subdivided and can be marketed and sold off individually, containing its own fee simple rights. This report utilizes no extraordinary assumptions.

INSPECTION DATE: The subject property was inspected on July 21, 2025.

Packet Page. 1337
11 THE LOCATION
San Bernardino County / Inland Empire
The subject property is located in the city of San Bernardino, the seat of San Bernardino County, which together with Riverside County, makes up the region known as the “Inland Empire”, one of the fastest growing regions in the country.

As land prices in Orange County and parts of Los Angeles County have historically moved upward, the industrial and warehousing base has moved outward - resulting in a vast new marketplace for developers/builders to create industrial parks in areas with comparatively affordable housing. As a whole, the Inland Empire to the east of Los Angeles has become a positive growth area for both employment and construction.

The Inland Empire - combined counties of Riverside and San Bernardino - is one of the fastest growing regions in the country. Primary reasons for this growth were lower housing costs and lower land costs for commercial and industrial development. The two county area of Riverside-San Bernardino forms the largest Metropolitan Statistical Area (MSA) in the nation with over 27,308 square miles. A population exceeding 4.5 million in January 2023 ranks the Inland Empire as the 14th most populous MSA in the United States.

San Bernardino is geographically the largest county in the nation. Riverside County stretches from Orange County to the Arizona Border. In both counties, most of the population resides in the county’s western portion.

The Inland Empire is still the fastest growing metropolitan area in Southern California and the second largest behind Los Angeles – having surpassed Orange and San Diego in population.

For the Month of June 2025, the unemployment rate for San Bernardino County was 5.9%, while the city of San Bernardino had an unemployment rate of 6.6 percent.

Neighborhood Surroundings
The subject’s neighborhood consists primarily of industrial light zoning and includes some commercial general, commercial heavy, office industrial park, and public facilities/recreation zoning, as well. The neighborhood may be described as E Street to the west, Mill Street to the north, Waterman Avenue to the east, and the Santa Ana River to the south.

The subject property is located midblock along the south side of Chandler place, approximately 270 yards east of E Street. There are restaurants, retail buildings, major medical facilities, religious buildings, schools, public parks, and access to the I-10 & 215 Freeways – all within 2.6 miles of the subject.

Packet Page. 1338
12 Land Description
Reference Drawings/Documents
Soils Report: None Provided
Environmental
Site Assessment: None Provided
Hazardous Waste /
Toxic Studies: None Provided
Preliminary Title Report: None Provided
Site Details
Address: S/O 333 Chandler Place, San Bernardino, California 92408 (No Recorded Address)
TG# 606-H5 (San Bernardino County)
APN: 0141-291-23 (Larger Parcel)
County: San Bernardino
Land Size: 1,397,271 SF (32.08 Acres, Larger Parcel)
Shape: Irregular (see plat map)
Zone: The subject larger parcel is located within a pocket Public Facilities (PF) zoned district.

Per Chapter 19.10 of the City of San Bernardino’s Development Code, The purpose of the PF zone is to provide for the continuation of existing and development of new schools, government
administrative, police, fire, libraries, social service, and other public facilities.

See Zoning map on the following page.

Packet Page. 1339
13 Flood Zone: The subject site is located within Flood Zone X500, community Panel No.060281-06071C-8683J; dated September 2, 2016. Zone X500 is not located within the 100-year flood zone. Flood insurance is generally not required. Please refer to the Flood Zone Map below.

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14 Soils Condition: A geo-technical investigation report was not submitted for review.

This appraisal report assumes that all recommendations (for grading; compaction; and foundation design, construction, and maintenance of) provided by the soils engineer have been implemented, and that construction designs provided for adequate load-bearing capacity and structural engineering to support the existing subject structure(s).

Hazardous Waste/
Toxic Conditions: None Provided
Title, Easements and
Encroachments: A preliminary title report was not provided for review. No adverse conditions, easements or encroachments were observed during the inspection of the site. Identification of these items is of a legal nature and an attorney specializing in this field should be consulted for their opinion concerning these items.

This report is not intended to render any opinion whatsoever regarding any adverse title conditions, easements or
encroachments that may affect the subject property. The value estimate is, however, predicated upon there being no adverse title conditions, easements or encroachments that would cause a loss in value or prohibit development. No responsibility is assumed for any such conditions, or for any expertise or knowledge required to discover them.

Utilities: All public utilities are available and assumed adequate for industrial oriented use(s).

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15 HIGHEST AND BEST USE
Highest and best use is defined as:

The reasonably, probable legal use of vacant land or an improved property, which is physically possible, appropriately supported, financially feasible and that results in the highest value. The four criteria the highest and best use must meet are legal permissibility, physical possibility, financial feasibility and maximum productivity.1
The above definition of the “Highest and Best Use” is in reference to land that is unimproved.

In cases of improved land a determination of the contributory value of the improvements to the land must be made. The improvements on a site may be of inappropriate use but will usually continue until the land value in its highest and best use exceeds the total value of the property in its existing use.

It should be noted that a highest and best use determination represents an appraiser's opinion based upon his or her judgment and the application of several forms of analyses. Like value, it is not a fact that can be found.

It is also important to note that the highest and best use of a site as if unimproved and available to put to its highest and best use may be different from the highest and best use of the property as improved. This is especially true when the property improvements are not the most appropriate use but still add value to the site. In such cases, unless additional improvements are possible and feasible, the existing improvements will probably remain in use until the value of the land exceeds the total value of the property with the improvements.

Appraisal practice therefore dictates that highest and best use be analyzed from two standpoints: (1) the property as if unimproved and available for development; and (2) the property as improved.

The highest and best use of both land as though vacant and as improved must meet four basic tests:

1. Is the use legally permissible or reasonably possible?

2. Is the use physically possible on the site?

3. Is the use economically and financially feasible under proposed and projected market conditions?

4. Is the use estimated to be the most productive among the alternatives that are legally permissible, physically possible, and economically feasible? 1 Source: The Dictionary of Real Estate Appraisal, Appraisal Institute.

Packet Page. 1342
16 Highest and Best Use - As Vacant
Highest and Best Use of a site as vacant assumes that a parcel of land is vacant or could be vacant by demolishing the improvements. Given this assumption, this analysis determines the size, quality, and function that would provide the highest return to the land. The four criteria of the Highest and Best Use (see above) provide a basis for analysis.

To form an opinion as to the Highest and Best Use as vacant, we considered the physical attributes of the subject property, its zoning, location and known governmental influences, and the uses of surrounding properties.

Legally Permissible
Legal permissibility depends on public restrictions such as zoning, building codes, as well as the private or contractual restrictions found in deeds and long-term leases.

No information regarding private restrictions has been provided. It appears that there are no deed or easement restrictions on the property that could negatively impact development. No long-term ground lease encumbers the land. Therefore, legal restrictions as they apply to the subject property are primarily the public restrictions of zoning.

The subject is zoned PF (Public Facilities). The legal allowed uses are compatible with the adjacent and surrounding neighborhood improved properties.

Physically Possible
The size, shape, terrain, soil conditions, accessibility, and availability of utilities for a parcel of land affect its utility and adaptability. The physical characteristics of the subject site appear to be adequate in terms of shape, size, topography, available utilities and accessibility.

Although the exact soil composition is unknown, it appears that the soil is also adequate to support building improvements. Therefore, it appears that the physical characteristics would allow for the legally permissible uses.

Financially Feasible and Maximally Productive
According to the Real Estate Terminology Handbook, a real estate project is feasible when the analysis indicates that there is a likelihood of satisfying the explicit objectives and when a selected course of action is tested in the context of specific constraints and limited resources.

The feasibility of a real estate project is normally related to its economic potential.

An in-depth feasibility analysis on the possible alternative uses of the site is beyond the scope of this appraisal assignment. However, the regional, city, and neighborhood characteristics impacting the subject property, as well as overall market conditions have been investigated.

Details regarding each category are presented in respective sections of this appraisal report.

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17 Conclusion
After reviewing overall market conditions, the subject’s location characteristics and competing developments, it is our opinion that the highest and best use of the subject site, as vacant and available for development, would likely be subsequent construction of light industrial zoned development dependent on feasibility study.

Highest and Best Use – As Improved
The subject is unimproved, vacant Public Facilities (PF) zoned land.

VALUATION METHODOLOGY
Typically, the process of appraising real property consists of compiling and analyzing data from three different perspectives; these approaches to value are:
• In the Cost Approach, the value of a property is derived by adding the estimated value of the land to the current cost of constructing a reproduction or replacement for the improvements and then subtracting the amount of depreciation (i.e., deterioration and obsolescence) in the structures from all causes. • The Income Approach is based upon the principle that the value of an income producing property is the present worth of anticipated future benefits, which are comprised of The Annual Income Stream (Cash Flow or Net Income) and the Reversion Benefits (Resale Value).
• The Sales Comparison Approach is a method of comparing recent sales of similar properties to the subject property. This approach is based on the principle of substitution in that a prudent investor would pay no more for the real property than the cost of acquiring a satisfactory alternative property that possesses physical, economic and financial comparability. The value of a particular property tends to coincide to the value indicated by the actions of informed buyers and sellers in the marketplace for similar properties.

In this report, the subject is unimproved vacant land, and the Cost Approach to value is excluded.

The Income Approach is also excluded, as the property is vacant land with no leases encumbering it.

In the case of the subject appraisal, we have utilized the Sales Comparison Approach in estimating the Market Value As Is.

The valuation of the subject property follows.

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18 THE SALES COMPARISON APPROACH
An investigation was undertaken to locate sales of similar commercial zoned land in the market area that could be used to provide direct market indications of the subject’s value. This survey focused primarily on the most comparable facilities/use to the subject property, which were deemed useful indicators of value for the subject property. Each comparable was visited and we attempted to verify the sales information with one or more of the parties to the transaction.

In this section, we contrast each sale comparable to the subject in terms of previously defined elements of comparison. The relative similarity of a comparable to the subject is expressed through a percentage adjustment or a dollar adjustment. The adjustments involve the appraiser’s judgment. Percentages are intended to reflect the magnitude and direction of the adjustment and should not be construed as a precise mathematical calculation based on quantifiable market evidence. In most instances, the large numbers of elements (or variables) that influence value in a real property transaction make it mathematically impossible to isolate and quantify a particular element’s impact on the final price.

In the case of the subject, the most appropriate unit of comparison is the price per square foot of land area, which reflects the primary value in the property. The following table summarizes the most relevant comparables in the valuation analysis. Photographs of each improved sales comparable as well as a map denoting their location relative to the subject are located in the Addenda of this report.

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19 Item Subject
Location / Address: S/O 333 Chandler Place
San Bernardino Assessor Parcel Number Portion of 0141-291-23 Proximity to Subject 606-H5 (San Bernardino)
Land SF 40,716
Sale Date N/A
Document Number N/A
Source Inspection
Interest Appraised Fee Simple
Sale Price N/A
$/Land SF: N/A
Property Rights Conveyed - Adjusted Price -
Financing Terms - Adjusted Price - Conditions of Sale / Listing - Adjusted Price - Time (Market Conditions) - Adjusted Price -
Expenditures Adjusted - Adjusted Price - Adjusted $/SF N/A Financing: Terms N/A

COMPARABILITY/ADJUS TMENTS
Property:

Site Accessibility Average E E E
Zoning PF (Public Facilities) CH / Inferior 20% IH (Industrial Heavy) E Land Area (SF) 40,716 37,209 102,366 7% 43,200
Shape / Utility Rectangular E E E
Topography Level E E E
Site / Building Improvements Vacant Land Vacant Land Vacant Land Vacant Land Overall Property Adjustment:
-
Location: Market Identity San Bernardino E E E
Transportation Linkages Conforming E E E
Street Location / Exposure Minor-Terminus of Minor Cul
de sac Street
Minor-Interior Primary-Interior -3% Minor-Interior
Neighborhood Surroundings Conforming E E E Overall Location Adjustment:
-
TOTAL ADJUSTMENT: -

INDICATED SUBJECT
$/LAND SF:
-
E = Equal; SI = Slightly Inferior; I = Inferior; SS = Slightly Superior; and S = Superior. $26.04
0%
$20.96 $28.45
0%
0%
45% Cash-Conv. TD
$26.04
$26.04

0.0%
$26.04

0.0%
$26.04

0.0%
$26.04

0.0%
$26.04

0.0%
$26.04
$1,125,000
Fee Simple
CoStar / Broker
23868
4-Feb-25
43,200

0.87 MI NE
0136-321-19
San Bernardino
776 S. Lugo Avenue
3 Land Sale Comparables 1 Through 3
2 19800 Cajon Boulevard
San Bernardino
0266-011-18

9.6 Miles NW
102,366
9-Jun-25
132274
CoStar / Broker
Fee Simple
$2,800,000
$27.35

0.0%
$27.35

0.0%
$27.35

0.0%
$27.35

0.0%
$27.35

0.0%
$27.35
$27.35
63% Cash - Private Party 1st TD
7%
-3%
4%
1 393 S. Sierra Way
San Bernardino
0136-221-10

1.3 Miles NE
37,209
7-Jul-25
148816
CoStar / Broker
Fee Simple
$650,000
$17.47

0.0%
$17.47

0.0%
$17.47

0.0%
$17.47

0.0%
$17.47

0.0%
$17.47
$17.47 All Cash Sale
20%
0%
20%
Packet Page. 1346
20 Item Subject
Location / Address: S/O 333 Chandler Place
San Bernardino
Assessor Parcel Number Portion of 0141-291-23
Proximity to Subject 606-H5 (San Bernardino)
Land SF 40,716
Sale Date N/A
Document Number N/A
Source Inspection
Interest Appraised Fee Simple
Sale Price N/A
$/Land SF: N/A
Property Rights Conveyed -
Adjusted Price -
Financing Terms -
Adjusted Price -
Conditions of Sale / Listing -
Adjusted Price -
Time (Market Conditions) -
Adjusted Price -
Expenditures Adjusted -
Adjusted Price -
Adjusted $/SF N/A
Financing: Terms N/A

COMPARABILITY/ADJUS
TMENTS
Property:

Site Accessibility Average E E E
Zoning PF (Public Facilities) E E E
Land Area (SF) 40,716 76,666 3% 73,181 3% 27,181 -3%
Shape / Utility Rectangular E E E
Topography Level E E E
Site / Building Improvements Vacant Land Vacant Land Vacant Land Vacant Land Overall Property Adjustment:
-
Location: Market Identity San Bernardino E E E
Transportation Linkages Conforming E E E
Street Location / Exposure Minor-Terminus of Minor Cul
de sac Street
Minor-Cul de sac Primary-CornerExposure to E/B
210 Freeway
-5% Primary-Interior -3%
Neighborhood Surroundings Conforming E E E Overall Location Adjustment:
-
TOTAL ADJUSTMENT: -

INDICATED SUBJECT
$/LAND SF:
-
E = Equal; SI = Slightly Inferior; I = Inferior; SS = Slightly Superior; and S = Superior. $33.59 $25.44 $24.21
3% -2% -6%
0% -5% -3%
3% 3% -3%
Conv. 1st TD All Cash Sale 50% Cash-Seller Financing
$32.61 $25.96 $25.75
$32.61 $25.96 $25.75

0.0% 0.0% 0.0%
$32.61 $25.96 $25.75

0.0% 0.0% 0.0%
$32.61 $25.96 $25.75

0.0% 0.0% 0.0%
$32.61 $25.96 $25.75

0.0% 0.0% 0.0%
$32.61 $25.96 $25.75

0.0% 0.0% 0.0%
$32.61 $25.96 $25.75
$2,500,000 $1,900,000 $700,000
Fee Simple Fee Simple Fee Simple
CoStar / Broker CoStar / Broker CoStar / Broker
6310 258499 233192
9-Jan-25 29-Oct-24 16-Oct-24
76,666 73,181 27,181

1.6 Miles SE 4.5 Miles NW 0.7 MI NE
0283-032-39, 45, 46 0268-453-12, 14 0136-431-33
San Bernardino San Bernardino San Bernardino
10799 S. Artesia Street 0 Medical Center Drive 247 E. Ennis Street 4 5 6
Land Sale Comparables 4 Through 6
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21 Item Subject
Location / Address: S/O 333 Chandler Place
San Bernardino
Assessor Parcel Number Portion of 0141-291-23
Proximity to Subject 606-H5 (San Bernardino)
Land SF 40,716
Sale Date N/A
Document Number N/A
Source Inspection
Interest Appraised Fee Simple
Sale Price N/A
$/Land SF: N/A
Property Rights Conveyed -
Adjusted Price -
Financing Terms -
Adjusted Price -
Conditions of Sale / Listing -
Adjusted Price -
Time (Market Conditions) -
Adjusted Price -
Expenditures Adjusted -
Adjusted Price -
Adjusted $/SF N/A
Financing: Terms N/A

COMPARABILITY/ADJUS
TMENTS
Property:

Site Accessibility Average E E
Zoning PF (Public Facilities) E E
Land Area (SF) 40,716 56,192 67,082 3%
Shape / Utility Rectangular E Triangular / SI 3%
Topography Level E E
Site / Building Improvements Vacant Land Vacant Land Vacant Land Overall Property
Adjustment:
-
Location: Market Identity San Bernardino E E
Transportation Linkages Conforming E E
Street Location / Exposure Minor-Terminus of Minor Cul
de sac Street
Cul-de-sac street Primary-Interior -3%
Neighborhood Surroundings Conforming E E
Overall Location
Adjustment:
-
TOTAL ADJUSTMENT: -

INDICATED SUBJECT
$/LAND SF:
-
E = Equal; SI = Slightly Inferior; I = Inferior; SS = Slightly Superior; and S = Superior. $21.36 $27.41
0% 3%
0% -3%
0% 6%
All Cash Sale Negotiable
$21.36 $26.61
$21.36 $26.61

0.0% 0.0%
$21.36 $26.61

0.0% 0.0%
$21.36 $26.61

0.0% -25.0%
$21.36 $35.48

0.0% 0.0%
$21.36 $35.48

0.0% 0.0%
$21.36 $35.48
$1,200,000 $2,380,000
Fee Simple Fee Simple
CoStar / Broker CoStar / Broker
233575 List Date: 5-23-25
30-Sep-24 Listing
56,192 67,082

1.8 Miles NE 1.3 Miles E
0280-082-10, 11, 09 0281-031-39
San Bernardino San Bernardino
8 892 E. Santa Fe Street 787 Orange Show Road
7 Land Sale Comparables 7 And 8
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22 Comments on Industrial Land Comparables
Our eight land sale comparables (seven closed, one active listing) are all located within a 10- mile radius submarket within the city of San Bernardino, and range in size from 27,181 to 102,366 SF, bracketing the subject at 40,716 square feet. Unadjusted sale rates range from $17.47 to $32.61 per land square foot, with sale dates raging from September of 2024 to as recently as July of 2025.

A downward listing adjustment was applied to Land sale comparable No. 8 to reflect the likelihood of a lower negotiated selling price.

Additional comments on some of the comparables follow.

Sale No. 1 ($17.47/Land SF) sold recently in July 2025 for $650,000. The listing broker, Robert Bagley of KW Commercial, stated it was a straightforward deal with no conditions of sale. He also stated the CH (Heavy Commercial) zoning designation limited its marketability, since the city does not allow any type of industrial development within this zoning classification. If it was zoned industrial, he believes it would have sold at least in the low-to-mid $20’s per land square foot (Source of Zoning Adjustment). Opinion of lease rates: $0.20-$0.25/Land SF.

Sale 2 ($27.35/Land SF) was also a straightforward sale to an owner-user who will utilize the yard for his transportation business, according to listing agent Ethan Flor of Macleod & Co. He believes lease rates on industrial land range from $0.25 to $0.27/Land SF asking, depending on the location (closer to on-and-off ramps is more desirable).

Sale No. 3 ($26.04/Land SF) was sold to an owner-user who plans on utilizing the fenced and secured yard area for his trucking business. There were no entitlements or approvals at the time of sale, and the price paid was for the raw land only.

Sale No. 5 ($25.96/Land SF) was sold to an owner-user who purchased the raw land without entitlements or conditions of sale, per listing broker Abraham Mendoza of DAUM Commercial.

The buyer owns a trucking company and will utilize the property as a truck yard and contractor yard. A small upward adjustment was applied for its larger parcel size. After adjustments, this comparable indicates a subject value of $25.44/Land SF.

Sale No. 6 ($25.75/Land SF) sold as raw land to an owner-user and was partially seller financed (no impact on sale price, per broker Javier Castillo of RE Advisers). The owner will relocate his pallet business to the site. An upward adjustment for its larger parcel size was more than offset by downward adjustment for its superior street location/exposure to the 210-Freeway eastbound lanes. After adjustments, this comparable indicates a subject value of $25.44/Land SF.

Sale No. 8 ($26.61/Land SF, Listing Status Adjusted) is our active listing, which is currently being offered at $2,380,000, or $35.48/Land SF. We spoke directly with the listing agent, Jag Singh of KW Commercial, who stated there has been very little interest at the offering price, and that it will soon be lowered to $2,100,000 ($31.30/Land SF). He thinks the market will Packet Page. 1349
23 remain soft for the foreseeable future, as tenants and owner-users watch worry about tariffs and high construction/borrowing costs.

Indicated Value - Sales Comparison Approach
After adjustments, the sales indicate a value range from $20.96 to $33.59/Land SF, and average $25.72 per land square foot (closed sales).

Based on the valuation analysis, the indicated subject value at $26.00/Land SF (Rounded) is considered reasonable and well supported by the comparable sales, and the market derived research.

Reconciliation
Our concluded price per land square foot at $26.00 is applied to the entire parcel is considered reasonable and well supported by the market data and accepted appraisal methodology. $26.00/Land SF x 40,716 SF $1,058,616
Rounded To: $1,060,000
Concluded Market Value
Packet Page. 1350
24 Supplemental Market Rent and Net Operating Income
At the request of the client, additional information on the subject property will be provided.

This will include an estimate of projected market rent for industrial zoned land; and the subject potential net operating income.

The first step in this approach is to estimate the market rental rate for the property. The estimate of building market rent is based primarily on broker interviews. As previously mentioned, we interviewed several listing brokers active in the submarket to get their opinion about lease and sale prices for industrial building and land. This includes Robert Bagley of KW Commercial; Shawn O’Gorman of O’Gorman Pacific Realty; Ethan Flor and Chase MacLeod of MacLeod & Co.; Wes Klein of Keller Williams; and Kyle Williams of Ashwill Associates.

All agreed that leasing activity has decreased significantly since its peak in 2021, and that tariffs have also negatively impacted the market as tenants anticipate lower warehouse and truck parking space requirements.

The aforementioned leasing agents believe the subject yard would reasonably lease from $0.20 to $0.25/Land SF.

Based on the market data and research as well as the consensus of brokers interviewed and prior land appraisal assignments near the subject location, the concluded building market rental of $0.20/Land SF (Net Basis) is considered reasonable and well supported by the market data and research.

Vacancy and Collection Loss Estimate
Based on CoStar Analytics and giving consideration to the Federal Reserve interest rate cycle, inflationary pressures, and opinions of brokers and other market participants in the submarket, the concluded vacancy-collection allowance of 10.0% over a stabilized operation (5 to 10-year holding period) is considered to be reasonable.

Operating Expenses
The subject has been owner occupied and no historical expenses were provided. Market evidence and interviews with brokers and professionals within the subject market area indicates that most properties with similar characteristics reflect a passive, net income expense basis, with the tenant paying any property taxes, insurance, management, and long-term capital items, including utilities and general property maintenance.

Management: We have estimated non-reimbursable management expenses at 1.5% of effective gross income, which considers the size of the project and responsibilities of the management and is typical of other similar sized properties.

Maintenance/reserves: In practice, most landlords do not include this as an operating expense; however, prudent management would set aside some amount for replacement of Packet Page. 1351
25 long-lived items. For this analysis, we will apply maintenance/reserve expense at $2,000 per year.

Projected gross income and operating expenses for the subject property are as shown in the table on the following page.

Based on the market data and research, the concluded potential net operating income for the subject property is $84,627
Capitalization Rate estimate
The consensus opinion of market participants interviewed, including the aforementioned listing agents as well as developers, is that investors would likely require a rate of return between 7.5% to 8.0% based on the subject risk profile. The table below shows the value based on overall rates from 7.00% to 8.25%.

SF Rental ($/Land SF) Total
40,716 $0.20 $97,718
40,716 $97,718
-$9,772
$87,947
Management - % of EGI 1.50% $1,319
$0.05 $2,000
Total Expenses ($3,319)
$0.08 3.8%
$84,627
Description Months Rental Basis
Land Market Rent x 12 Market (Net)
Base Rental Income
Less Vacancy & Collection Loss 10.0%
Effective Gross Income
Reserves
$/PSF Year / % EGI
Net Operating Income
Less: Operating Expenses
Cap Rate: Value: $/SF

7.00% $1,208,962 $29.69

7.25% $1,167,274 $28.67

7.50% $1,128,365 $27.71

7.75% $1,091,966 $26.82

8.00% $1,057,842 $25.98

8.25% $1,025,786 $25.19
Packet Page. 1352
26 Definitions / Assumptions / Limiting Conditions
Packet Page. 1353
27 Definition of Market Value:
"The most probable price which a property should bring in a competitive and open market under all conditions requisite to a fair sale, the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus. Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions whereby: Buyer and seller are typically motivated; Both parties are well informed or well advised, and acting in what they consider their own best interests; A reasonable time is allowed for exposure in the open market; Payment is made in terms of cash in U.S. dollars or in terms of financial arrangements comparable thereto; and The price represents the normal consideration for the property sold unaffected by special or creative financing or sales concessions granted by anyone associated with the sale." (Source: Code of Federal Regulations, Title 12, Chapter I, Part 34.42(g]; also Interagency Appraisal and Evaluation Guidelines, Federal Register, 75 FR 77449, December 10, 2010, page 77472)
Definition of As Is Market Value As is:
"The estimate of the market value of real property in its current physical condition, use, and zoning as of the appraisal date." (Source: Appraisal Institute, The Dictionary of Real Estate Appraisal, 6th ed. (Chicago:

Appraisal Institute, 2015); also Interagency Appraisal and Evaluation Guidelines, Federal Register, 75 FR 77449, December 10, 2010, page 77471)
Definition of Hypothetical Condition:

A condition, directly related to a specific assignment, which is contrary to what is known by the appraiser to exist on the effective date of the assignment results, but is used for the purpose of analysis. Comment:

Hypothetical conditions are contrary to known facts about physical, legal, or economic characteristics of the subject property; or about conditions external to the property, such as market conditions or trends; or about the integrity of data used in an analysis.

Packet Page. 1354
28 ASSUMPTIONS AND LIMITING CONDITIONS
This appraisal is subject to the following assumptions and limiting conditions:

No responsibility is assumed for matters legal in character or nature. No opinion is rendered as to title, which is assumed to be good and marketable. All existing liens, encumbrances, and assessments have been disregarded, unless otherwise noted, and the property is appraised as though free and clear, having responsible ownership and competent management.

We have examined the property described herein exclusively for the purposes of identification and description of the real property. The objective of our data collection is to develop an opinion of the highest and best use of the subject property and make meaningful comparisons in the valuation of the property.

The appraiser's observations and reporting of the subject improvements are for the appraisal process and valuation purposes only and should not be considered as a warranty of any component of the property. This appraisal assumes (unless otherwise specifically stated) that the subject is structurally sound, and all components are in working condition.

We will not be required to give testimony or appear in court because of having made an appraisal of the property in question, unless specific arrangements to do so have been made in advance, or as otherwise required by law.

We have noted in this appraisal report any significant adverse conditions (such as needed repairs, depreciation, the presence of hazardous wastes, toxic substances, etc.) discovered during the data collection process in performing the appraisal.

Unless otherwise stated in this appraisal report, we have no knowledge of any hidden or unapparent physical deficiencies or adverse conditions of the property (such as, but not limited to, needed repairs, deterioration, the presence of hazardous wastes, toxic substances, adverse environmental conditions, etc.) that would make the property less valuable, and have assumed that there are no such conditions and make no guarantees or warranties, express or implied. We will not be responsible for any such conditions that do exist or for any engineering or testing that might be required to discover whether such conditions exist. Because we are not experts in the field of environmental hazards, this appraisal report must not be considered as an environmental assessment of the property. We obtained the information, estimates, and opinions furnished by other parties and expressed in this appraisal report from reliable public and/or private sources that we believe to be true and correct.

We will not disclose the contents of this appraisal report except as provided for in the Uniform Standards of Professional Appraisal Practice, and/or applicable federal, state or local laws.

Packet Page. 1355
29 APPRAISER’S CERTIFICATIONS
We do hereby certify that, except as otherwise noted in this report:

We have made a personal inspection of the property that is the subject of this report.

We have no past, present or prospective interest or bias in the property that is the subject of this report and no personal interest or bias with respect to the parties involved.

To the best of our knowledge and belief, the statements of fact contained in this report, upon which the analysis, opinions, and conclusions expressed herein are based, are true and correct.

The analysis, opinions, and conclusions contained in this report are limited only by the reported assumptions and limiting conditions imposed by the terms of our assignment or by the undersigned and are our personal, impartial, and unbiased professional analysis, opinions, and conclusions.

The reported analysis, opinions, and conclusions were developed, and this report has been prepared, in conformity with the Uniform Standards of Professional Appraisal Practice and in conformity conforms to the requirements of the code of professional ethics and standards of professional appraisal practice of the Appraisal Institute.

The use of this report is subject to the requirements of the Appraisal Institute relating to review by its duly authorized representatives.

The Appraisal Institute has a voluntary program of continuing education requirements. Steven R. Smith is certified through 2025 with his education requirement.

In accordance with the Competency Provision of the Uniform Standards of Professional Appraisal Practice (USPAP), We have verified that our knowledge and experience is sufficient to allow us to competently complete this appraisal unless stated otherwise within this report.

The appraisers further certify and agree that:

Our compensation is not contingent upon the reporting of a predetermined value or direction in value that favors the cause of the client, the amount of value opinion, the attainment of a stipulated result, or the occurrence of a subsequent event directly related to the intended use of this appraisal.

This appraisal assignment was not based on a requested minimum valuation, a specific valuation, or the approval of a loan.

We previously appraised the subject’s larger parcel, with an effective date of value of November 5, 2024.

Any person who receives a copy of this appraisal report as a consequence of disclosure requirements that apply to an appraiser's client, does not become an intended user of this report unless the client specifically identified them at the time of the assignment. The appraiser's written consent and approval must be obtained before this appraisal report can be conveyed by anyone to the public through advertising, public relations, news, sales, or other media.

Packet Page. 1356
30 Respectfully submitted,
Steven R. Smith, MSREA, MAI, SRA,
AG 2123, expires 7/20/25
Benjamin Castro, Certified General Appraiser
AG 040398, expires 8/30/2025
Packet Page. 1357
31 APPRAISER QUALIFICATIONS
STEVEN R. SMITH, MSREA, MAI, SRA, AG 2123

MS IN REAL ESTATE APPRAISAL, BA IN REAL ESTATE FINANCE
FULL TIME APPRAISER SINCE 1976. PART TIME UNIVERSITY INSTRUCTOR IN REAL ESTATE AT CAL STATE UNIVERSITY 2005-2015.

PRIOR WORK EXPERIENCE INCLUDED LOAN SERVICING, LOAN ORIGINATION, LOAN ADMINISTRATION, TITLE INSURANCE SALES, REAL ESTATE SALE, MORTGAGE LENDING, AND REAL ESTATE SALES MANAGEMENT.

APPRAISAL EXPERIENCE INCLUDES PERFORMING APPRAISALS AND MARKET STUDIES ON EXISTING, PROPOSED AND DISTRESSED PROPERTIES, NON-PERFORMING OR DESTABILIZED PROJECT.

COURT TESTIMONY EXPERIENCE INCLUDES A RANGE OF CIVIL AND CRIMINAL CASES, PROFESSIONAL LIABILITY CASES, MORTGAGE FRAUD AND REAL ESTATE FRAUD CASES; AS BOTH AN EXPERT WITNESS OR AS A REBUTTAL WITNESS. DEPOSITION TESTIMONY HAS ALSO INCLUDED IRS AND EMINENT DOMAIN CASES.

NO COURT TESTIMONY HAS BEEN PROVIDED IN EITHER OF THESE TYPES OF CASES AS EVERYONE HAS SETTLED.

SEMINARS CREATED AND DELIVERED INCLUDE:

MORTGAGE FRAUD AND THE APPRAISERS ROLE- AI-2005,
BUILDING TRANSFERABLE SKILL-SETS, AI – 2005,
PREDATOR LENDING, CLIENT PRESSURES & APPRAISAL FRAUD, 2004, MORTGAGE FRAUD, CASES & CONSEQUENCES, 2002,
REAL ESTATE FRAUD, APPRAISERS LIABILITIES & RESPONSIBILITIES, 2000, REAL ESTATE FRAUD & THE APPRAISERS ROLE, 2000, APPRAISAL REVIEW- SREA - 1989.

APPRAISER LIABILITY SEMINAR- SREA - 1988.

CAL LEAGUE OF SAVINGS INSTITUTIONS - APPRAISAL QUALITY CONTROL - 1988.

RESIDENTIAL APPRAISAL SEMINAR - AIREA - 1987.

BOSTON SAFE GUIDELINES - 1985-1988.

MORTGAGE BANKERS OF AMERICA-APPRAISAL REVIEW - 1984-86.

NARAMU-APPRAISAL REVIEW & FRAUD PREVENTION - 1984-1985.

UNIFORM APPRAISAL GUIDELINES - 1984-88.
99 POINT APPRAISAL REVIEW WORKSHOP - 1984-1986.

EXPERIENCE CREDIT WORKSHOP-USPAP COMPLIANCE, APPRAISAL INSTITUTE 1991.

USPAP COMPLIANCE, APMW, 1991.

ESTATE AND LUXURY HOME APPRAISAL REVIEW – APPRAISAL INSTITUTE - 1997.

SPECIALTIES INCLUDE: LUXURY HOMES, AND FORENSIC APPRAISAL REVIEW CONTACT: 909-856-6841, WEB PAGE: HTTP://SRSREA.COM, EMAIL: [email protected] Packet Page. 1358
32 PROFESSIONAL QUALIFICATIONS – BENJAMIN CASTRO
Have accumulated extensive experience in valuing all types of real property, including residential, commercial, retail, office, industrial, and vacant land. Clients include local lenders, law and CPA firms, insurance companies, state and local agencies, as well as private individuals.

EMPLOYMENT HISTORY
Certified General Appraiser
2017-2023
The Miller Company (Corona, CA.)
Worked with staff of experienced appraisers valuing real property throughout Southern California. Duties included identification of the appraisal problem; scope of work determination; data collection and property description, including broker interviews; developing highest and best use analysis; and reconciliation of value. Properties appraised primarily included retail, commercial, mixed-use, industrial, office, and vacant land, among others. Interests valued include fee simple and leased fee which include perspective and assignment conditions as well as discounting.

Staff Appraiser
2016-2017
The Doré Group (San Diego, CA.)
Prepared summary appraisal and lease analysis reports for various clients, including CPA’s, banks, law firms, investors, developers, owner-users, credit retail tenants, and counties and agencies throughout the State of California, including eminent domain via condemnation and easement acquisition. Duties included the typical valuation process that resulted in credible, supportable value conclusions. Properties appraised included retail, commercial, industrial, office, agricultural, institutional, and vacant land, among others. Interests valued included fee simple, leased fee, leasehold, as well as partial interests.

Certified General Appraiser / Valuation Analyst
2015-2016
CBRE Valuation Services (San Diego, CA.)
As part of the Small Lending Solutions program at CBRE, worked with a team of salaried appraisers valuing a variety of retail, industrial, and small office properties.

Valuation Associate
2007-2014
Appraisal Pacific (San Marcos, CA.)
Responsibilities included field inspections and participating in all aspects of the appraisal process, including research, broker interviews, comparable selections and adjustments, Packet Page. 1359
33 and reconciliation of values, among others.

EDUCATION
University of California, Los Angeles
Bachelor of Arts, Psychology

CERTIFICATION
Certified General Real Estate Appraiser
BREA Appraiser Identification No.: AG040398 (Expiration Date: August 30, 2027) Packet Page. 1360

ITEMS TO BE CONSIDERED FOR FUTURE MEETINGS
City of San Bernardino
Request for Council Action
Date: September 17, 2025
To: Honorable Mayor and City Council Members
From: Dr. Treasure Ortiz, Council Member, 7th Ward
Department: Council Office
Subject: Discuss a Potential for a One-Year Moratorium on the Sale and Use of Fireworks Within the City of San Bernardino
and/or Restriction on Permitting and/or Increasing Fines and Enforcement; to be Brought Back to the City Council Within the Next 60 Days (All Wards) –(Council Member
Ortiz)
CC: Eric Levitt, City Manager
Packet Page. 1361

ITEMS TO BE CONSIDERED FOR FUTURE MEETINGS
City of San Bernardino
Request for Council Action
Date:

To:

From:

Department:

Subject:

September 17, 2025
Honorable Mayor and City Council Members
Kim Knaus, Council Member, 5th Ward
Council Office
Direct Staff to Research and Bring Back a Policy Proposal Within 45 Days Evaluating the Feasibility of Requiring All Public and Private Homeless Shelters, Interim Housing
Facilities, Homeless Recuperative Care Centers and
Similar Facilities Operating Within the City of San
Bernardino to Allocate of Minimum of 40% of Beds, Rooms and Service to the City of San Bernardino to Effectively Address the City’s Unhoused Population, Demonstrate the Ability to Provide Shareable Data (As the Law Permits) and Track Participant Outcomes for No Less Than Six months, Submit a 12 Month Security Plan Annually for Approval,
Reimbursement Requirement for Any Nuisance
Complaints and Increased Service Demands as a Result of the Project, and Complete Interior and Exterior Facility Upgrades that Enhance Neighborhood Aesthetics and
Align with Current City Standards. (All Wards) -
Council Member Knaus
CC: Eric Levitt, City Manager
Packet Page. 1362

ITEMS TO BE CONSIDERED FOR FUTURE MEETINGS
City of San Bernardino
Request for Council Action
Date: September 17, 2025
To: Honorable Mayor and City Council Members
From: Fred Shorett, Council Member, 4th Ward
Department: City Manager's Office
Subject: Direct the City Manager to Convene a Special Meeting or Workshop of the Mayor and City Council Within 30 to 60
Days to Provide a Comprehensive Update on the
Navigation Center and City-Funded Homeless Service
Contractors, Including Project Status, timeline, Budget, Funding, and Performance Outcomes from 2022 to
Present. (All Wards) - (Council Member Shorett)
Packet Page. 1364
CC: Eric Levitt, City Manager

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