Agenda packet, regular meeting, second session — San Clemente City Council, February 6, 2024 (part 2 of 3)

City of San Clemente - Liability
Funding Options for Program Year 2023-2024 (SIR = $400,000) Dollar Payroll
Amount Rate
(A) Estimated Ultimate Losses Incurred in
Accident Year 2023-2024: $1,672,000 $8.823
(Based on Exhibit 4, Page 1, (K))
(B) Estimated Claims Administration Fees
Incurred in Accident Year 2023-2024: 0 0.000
(From Exhibit 4, Page 1, (L))
(C) Total Claims Costs
Incurred in Accident Year 2023-2024: $1,672,000 $8.823
((A) + (B))
(D) Loss Discount Factor (Based on a Discount Rate of 2.00%.): 0.947 (Based on Appendix G, Page 2, (G))
(E) Discounted Total Claims Costs
Incurred in Accident Year 2023-2024: $1,584,000 $8.358
((C) x (D))
Marginally
Acceptable Recommended Conservative
70% 75% 80% 85% 90%
(F) Confidence Level Factor:
(Based on Appendix H) 1.181 1.269 1.373 1.504 1.678
(G) Margin for Adverse Experience: 287,000 426,000 591,000 798,000 1,074,000 ((E) x [(F) - 1])
(H) Recommended Funding in 2023-2024
for Claims Costs and Other Expenses: $1,871,000 $2,010,000 $2,175,000 $2,382,000 $2,658,000 ((E) + (G))
(I) Rate per $100 of Payroll: $9.873 $10.606 $11.477 $12.569 $14.025 ((H) / $189,515)
Payroll rates are per hundred dollars of 2023-2024 payroll of $18,951,500. 34 38
Exhibit 1
Page
City of San Clemente - Liability
Funding Options for Program Year 2022-2023 (SIR = $500,000) Dollar Payroll
Amount Rate
(A) Estimated Ultimate Losses Incurred in
Accident Year 2022-2023: $1,596,000 $8.632
(Based on Exhibit 4, Page 1, (K))
(B) Estimated Claims Administration Fees
Incurred in Accident Year 2022-2023: 0 0.000
(From Exhibit 4, Page 1, (L))
(C) Total Claims Costs
Incurred in Accident Year 2022-2023: $1,596,000 $8.632
((A) + (B))
(D) Loss Discount Factor (Based on a Discount Rate of 2.00%.): 0.946 (Based on Appendix G, Page 2, (G))
(E) Discounted Total Claims Costs
Incurred in Accident Year 2022-2023: $1,510,000 $8.167
((C) x (D))
Marginally
Acceptable Recommended Conservative
70% 75% 80% 85% 90%
(F) Confidence Level Factor:
(Based on Appendix H) 1.182 1.270 1.375 1.507 1.682
(G) Margin for Adverse Experience: 275,000 408,000 566,000 766,000 1,030,000 ((E) x [(F) - 1])
(H) Recommended Funding in 2022-2023
for Claims Costs and Other Expenses: $1,785,000 $1,918,000 $2,076,000 $2,276,000 $2,540,000 ((E) + (G))
(I) Rate per $100 of Payroll: $9.654 $10.374 $11.228 $12.310 $13.738 ((H) / $184,893)
Payroll rates are per hundred dollars of 2022-2023 payroll of $18,489,300. 35 39
Exhibit 1
Page
City of San Clemente - Liability
Funding Options for Program Year 2023-2024 (SIR = $500,000) Dollar Payroll
Amount Rate
(A) Estimated Ultimate Losses Incurred in
Accident Year 2023-2024: $1,878,000 $9.910
(Based on Exhibit 4, Page 1, (K))
(B) Estimated Claims Administration Fees
Incurred in Accident Year 2023-2024: 0 0.000
(From Exhibit 4, Page 1, (L))
(C) Total Claims Costs
Incurred in Accident Year 2023-2024: $1,878,000 $9.910
((A) + (B))
(D) Loss Discount Factor (Based on a Discount Rate of 2.00%.): 0.946 (Based on Appendix G, Page 2, (G))
(E) Discounted Total Claims Costs
Incurred in Accident Year 2023-2024: $1,777,000 $9.377
((C) x (D))
Marginally
Acceptable Recommended Conservative
70% 75% 80% 85% 90%
(F) Confidence Level Factor:
(Based on Appendix H) 1.182 1.270 1.375 1.507 1.682
(G) Margin for Adverse Experience: 323,000 480,000 666,000 901,000 1,212,000 ((E) x [(F) - 1])
(H) Recommended Funding in 2023-2024
for Claims Costs and Other Expenses: $2,100,000 $2,257,000 $2,443,000 $2,678,000 $2,989,000 ((E) + (G))
(I) Rate per $100 of Payroll: $11.081 $11.909 $12.891 $14.131 $15.772 ((H) / $189,515)
Payroll rates are per hundred dollars of 2023-2024 payroll of $18,951,500. 36 40
Exhibit 1
Page
City of San Clemente - Liability
Funding Options for Program Year 2022-2023 (SIR = $750,000) Dollar Payroll
Amount Rate
(A) Estimated Ultimate Losses Incurred in
Accident Year 2022-2023: $1,782,000 $9.638
(Based on Exhibit 4, Page 1, (K))
(B) Estimated Claims Administration Fees
Incurred in Accident Year 2022-2023: 0 0.000
(From Exhibit 4, Page 1, (L))
(C) Total Claims Costs
Incurred in Accident Year 2022-2023: $1,782,000 $9.638
((A) + (B))
(D) Loss Discount Factor (Based on a Discount Rate of 2.00%.): 0.945 (Based on Appendix G, Page 2, (G))
(E) Discounted Total Claims Costs
Incurred in Accident Year 2022-2023: $1,684,000 $9.108
((C) x (D))
Marginally
Acceptable Recommended Conservative
70% 75% 80% 85% 90%
(F) Confidence Level Factor:
(Based on Appendix H) 1.183 1.273 1.381 1.515 1.695
(G) Margin for Adverse Experience: 308,000 460,000 642,000 867,000 1,170,000 ((E) x [(F) - 1])
(H) Recommended Funding in 2022-2023
for Claims Costs and Other Expenses: $1,992,000 $2,144,000 $2,326,000 $2,551,000 $2,854,000 ((E) + (G))
(I) Rate per $100 of Payroll: $10.774 $11.596 $12.580 $13.797 $15.436 ((H) / $184,893)
Payroll rates are per hundred dollars of 2022-2023 payroll of $18,489,300. 37 41
Exhibit 1
Page
City of San Clemente - Liability
Funding Options for Program Year 2023-2024 (SIR = $750,000) Dollar Payroll
Amount Rate
(A) Estimated Ultimate Losses Incurred in
Accident Year 2023-2024: $2,248,000 $11.862
(Based on Exhibit 4, Page 1, (K))
(B) Estimated Claims Administration Fees
Incurred in Accident Year 2023-2024: 0 0.000
(From Exhibit 4, Page 1, (L))
(C) Total Claims Costs
Incurred in Accident Year 2023-2024: $2,248,000 $11.862 ((A) + (B))
(D) Loss Discount Factor (Based on a Discount Rate of 2.00%.): 0.945 (Based on Appendix G, Page 2, (G))
(E) Discounted Total Claims Costs
Incurred in Accident Year 2023-2024: $2,124,000 $11.208 ((C) x (D))
Marginally
Acceptable Recommended Conservative
70% 75% 80% 85% 90%
(F) Confidence Level Factor:
(Based on Appendix H) 1.183 1.273 1.381 1.515 1.695
(G) Margin for Adverse Experience: 389,000 580,000 809,000 1,094,000 1,476,000 ((E) x [(F) - 1])
(H) Recommended Funding in 2023-2024
for Claims Costs and Other Expenses: $2,513,000 $2,704,000 $2,933,000 $3,218,000 $3,600,000 ((E) + (G))
(I) Rate per $100 of Payroll: $13.260 $14.268 $15.476 $16.980 $18.996 ((H) / $189,515)
Payroll rates are per hundred dollars of 2023-2024 payroll of $18,951,500. 38 42
Exhibit 1
Page
City of San Clemente - Liability
Funding Options for Program Year 2022-2023 (SIR = $1,000,000) Dollar Payroll
Amount Rate
(A) Estimated Ultimate Losses Incurred in
Accident Year 2022-2023: $1,932,000 $10.449
(Based on Exhibit 4, Page 1, (K))
(B) Estimated Claims Administration Fees
Incurred in Accident Year 2022-2023: 0 0.000
(From Exhibit 4, Page 1, (L))
(C) Total Claims Costs
Incurred in Accident Year 2022-2023: $1,932,000 $10.449 ((A) + (B))
(D) Loss Discount Factor (Based on a Discount Rate of 2.00%.): 0.944 (Based on Appendix G, Page 2, (G))
(E) Discounted Total Claims Costs
Incurred in Accident Year 2022-2023: $1,824,000 $9.865
((C) x (D))
Marginally
Acceptable Recommended Conservative
70% 75% 80% 85% 90%
(F) Confidence Level Factor:
(Based on Appendix H) 1.182 1.274 1.383 1.519 1.702
(G) Margin for Adverse Experience: 332,000 500,000 699,000 947,000 1,280,000 ((E) x [(F) - 1])
(H) Recommended Funding in 2022-2023
for Claims Costs and Other Expenses: $2,156,000 $2,324,000 $2,523,000 $2,771,000 $3,104,000 ((E) + (G))
(I) Rate per $100 of Payroll: $11.661 $12.569 $13.646 $14.987 $16.788 ((H) / $184,893)
Payroll rates are per hundred dollars of 2022-2023 payroll of $18,489,300. 39 43
Exhibit 1
Page
City of San Clemente - Liability
Funding Options for Program Year 2023-2024 (SIR = $1,000,000) Dollar Payroll
Amount Rate
(A) Estimated Ultimate Losses Incurred in
Accident Year 2023-2024: $2,538,000 $13.392
(Based on Exhibit 4, Page 1, (K))
(B) Estimated Claims Administration Fees
Incurred in Accident Year 2023-2024: 0 0.000
(From Exhibit 4, Page 1, (L))
(C) Total Claims Costs
Incurred in Accident Year 2023-2024: $2,538,000 $13.392 ((A) + (B))
(D) Loss Discount Factor (Based on a Discount Rate of 2.00%.): 0.944 (Based on Appendix G, Page 2, (G))
(E) Discounted Total Claims Costs
Incurred in Accident Year 2023-2024: $2,396,000 $12.643 ((C) x (D))
Marginally
Acceptable Recommended Conservative
70% 75% 80% 85% 90%
(F) Confidence Level Factor:
(Based on Appendix H) 1.182 1.274 1.383 1.519 1.702
(G) Margin for Adverse Experience: 436,000 657,000 918,000 1,244,000 1,682,000 ((E) x [(F) - 1])
(H) Recommended Funding in 2023-2024
for Claims Costs and Other Expenses: $2,832,000 $3,053,000 $3,314,000 $3,640,000 $4,078,000 ((E) + (G))
(I) Rate per $100 of Payroll: $14.943 $16.110 $17.487 $19.207 $21.518 ((H) / $189,515)
Payroll rates are per hundred dollars of 2023-2024 payroll of $18,951,500. 40 44
Exhibit 2
City of San Clemente - Liability
IBNR as of 6/30/23 at Expected Claims Level
Estimated
Percent of
IBNR
Estimated Reported Estimated
Reported IBNR Between Estimated IBNR
Accident Estimated as of as of 1/1/23 and IBNR as of
Year Ultimate 12/31/22 12/31/22 6/30/23 Reported 6/30/23 (A) (B) (C) (D) (E) (F)
2005-2006 38,028 38,028 0 100.0% 0 0
2006-2007 738,196 738,196 0 100.0% 0 0
2007-2008 337,085 337,085 0 100.0% 0 0
2008-2009 1,361,721 1,361,721 0 100.0% 0 0
2009-2010 844,729 844,729 0 100.0% 0 0
2010-2011 572,478 572,478 0 100.0% 0 0
2011-2012 427,370 427,370 0 100.0% 0 0
2012-2013 572,990 572,990 0 100.0% 0 0
2013-2014 327,158 327,158 0 100.0% 0 0
2014-2015 1,427,034 1,427,034 0 100.0% 0 0
2015-2016 420,423 420,423 0 100.0% 0 0
2016-2017 440,266 440,266 0 66.6% 0 0
2017-2018 158,998 158,998 0 37.3% 0 0
2018-2019 548,608 548,608 0 36.0% 0 0
2019-2020 686,000 629,833 56,167 32.2% 18,000 38,167
2020-2021 1,576,000 1,421,309 154,691 29.9% 46,000 108,691 2021-2022 1,256,000 767,677 488,323 27.7% 135,000 353,323 2022-2023 1,173,000 54,491 532,509 22.8% 255,000 863,509 Totals $12,906,084 $11,088,394 $1,231,690 $454,000 $1,363,690 Notes:

$
From Exhibit 3, Page 1.

%
Provided by the City. These losses exclude amounts
incurred above for each year.

&
(A) - (B).

'
Percentage of incurred but not reported (IBNR) expected to be reported between 1/1/23 and 6/30/23. The percentage is based on the development pattern selected in Appendix A.

(
((A) - (B)) x (D).

)
(A) - (B) - (E).

This exhibit shows the calculation of the amount of incurred but not reported losses we expect as of 6/30/23. This amount is dependent on both the strength of the case reserves and the average frequency and severity of the losses incurred.
41 45
Exhibit 3

Page 1 ends

City of San Clemente - Liability
Estimated Ultimate Program Losses
Selected
Exposure Exposure Estimate of
Reported Paid Method Method Selected Ultimate
Loss Loss Based on Based on Frequency- Estimate of Losses Accident Development Development Reported Paid Severity Ultimate Limited to Year Method Method Losses Losses Method Losses Aggregate (A) (B) (C) (D) (E) (F) (G)
2005-2006 38,028 38,028 38,028 38,028 62,123 38,028 38,028 2006-2007 738,196 738,196 738,196 738,196 614,075 738,196 738,196 2007-2008 337,085 337,085 337,085 337,085 314,500 337,085 337,085 2008-2009 1,361,721 1,361,721 1,361,721 1,361,721 1,298,757 1,361,721 1,361,721 2009-2010 844,729 844,729 844,729 844,729 897,501 844,729 844,729 2010-2011 572,478 572,478 572,478 572,478 477,652 572,478 572,478 2011-2012 427,370 427,370 427,370 427,370 594,983 427,370 427,370 2012-2013 572,990 572,990 572,990 572,990 490,840 572,990 572,990 2013-2014 327,158 328,139 327,158 328,127 322,785 327,158 327,158 2014-2015 1,427,034 1,437,023 1,427,034 1,436,525 1,355,970 1,427,034 1,427,034 2015-2016 420,423 426,309 420,423 427,409 499,170 420,423 420,423 2016-2017 441,587 453,034 441,806 454,642 513,415 440,266 440,266 2017-2018 160,270 172,513 167,913 245,917 877,640 158,998 158,998 2018-2019 565,066 661,073 582,982 750,112 1,229,400 548,608 548,608 2019-2020 685,258 817,545 732,446 971,320 893,095 686,000 686,000 2020-2021 1,780,900 2,068,715 1,648,019 1,503,631 899,946 1,576,000 1,576,000 2021-2022 1,404,081 1,676,898 1,284,790 1,226,589 1,153,656 1,256,000 1,256,000 2022-2023 325,093 55,757 1,020,242 1,143,077 1,082,620 1,173,000 1,173,000 Totals $12,906,084 $12,906,084
Projected Losses for the Year 2022-2023 (H) $1,173,000 $1,173,000 Projected Losses for the Year 2023-2024 (I) 1,294,000 1,294,000 Notes:
(A) From Appendix A, Page 1, Column (G).
(B) From Appendix B, Page 1, Column (G).
(C) From Appendix C, Page 1, Column (G).
(D) From Appendix C, Page 2, Column (G).
(E) From Appendix D, Page 1, Column (C).
(F) Selected averages of (A), (B), (C), (D), and (E).
(G) (F) limited to applicable aggregate.
(H) From Exhibit 4, Page 1, Line (K).
(I) From Exhibit 4, Page 1, Line (K).

This exhibit summarizes the results of the actuarial methods we have applied to estimate ultimate losses for each year. It is important to apply a number of estimation methods because each one relies on specific assumptions about the claims process that tend to hold generally true, but that may be violated in specific situations. Thus, the more estimation methods that can be applied, the better. 42 46
Exhibit 3

Page 2 ends

City of San Clemente - Liability
Estimated Ultimate Limited Losses Capped at $100,000 per Claim Exposure Exposure
Reported Paid Method Method Selected
Loss Loss Based on Based on Frequency- Ultimate
Accident Development Development Reported Paid Severity Limited Year Method Method Losses Losses Method Losses
(A) (B) (C) (D) (E) (F)
2005-2006 38,028 38,028 38,028 38,028 38,036 38,028
2006-2007 370,580 370,580 370,580 370,580 370,591 370,580 2007-2008 187,085 187,085 187,085 187,085 187,100 187,085 2008-2009 761,721 761,721 761,721 761,721 761,739 761,721 2009-2010 519,101 519,101 519,101 519,101 519,090 519,101 2010-2011 272,478 272,478 272,478 272,478 272,489 272,478 2011-2012 335,387 335,387 335,387 335,387 335,389 335,387 2012-2013 272,990 272,990 272,990 272,990 273,000 272,990 2013-2014 177,158 177,158 177,158 177,158 177,165 177,158 2014-2015 734,563 734,563 734,563 734,563 734,547 734,563 2015-2016 266,931 266,931 266,931 266,931 266,945 266,931 2016-2017 271,070 272,425 271,070 272,425 271,075 271,070 2017-2018 158,998 161,383 158,998 167,713 457,579 158,998 2018-2019 249,851 263,524 251,665 283,455 634,050 248,608 2019-2020 425,505 444,631 427,973 479,827 454,965 426,000 2020-2021 726,996 743,317 719,490 669,968 452,914 727,000 2021-2022 626,220 599,332 611,285 576,069 573,678 627,000 2022-2023 218,890 28,495 482,858 553,604 532,000 593,000 Totals $6,987,698
Projected Losses for the Year 2022-2023 (G) $593,000
Projected Losses for the Year 2023-2024 (H) 628,000
Notes:
(A) From Appendix A, Page 1, Column (D).
(B) From Appendix B, Page 1, Column (D).
(C) Based on results in Appendix C, Page 1.
(D) Based on results in Appendix C, Page 2.
(E) Based on results in Appendix D, Page 1.
(F) Selected averages of (A), (B), (C), (D), and (E).
(G) From Exhibit 4, Page 1, Line (K) / Line (G).
(H) From Exhibit 4, Page 1, Line (K) / Line (G).

This exhibit summarizes the results of the actuarial methods we have applied to estimate limited losses for each year. These results are used to select a limited loss rate for future years. 43 47
Exhibit 4

Page 1 ends

City of San Clemente - Liability
Selection of Projected Limited Loss Rate
and Projection of Program Losses and ALAE
Ultimate Trended Trended Trended
Accident Limited Trend Limited Payroll Limited
Year Losses Factor Losses ($00) Loss Rate
(A) (B) (C) (D) (E)
2005-2006 38,028 1.084 41,222 198,386 0.208
2006-2007 370,580 1.079 399,856 200,199 1.997
2007-2008 187,085 1.074 200,929 205,491 0.978
2008-2009 761,721 1.069 814,280 215,752 3.774
2009-2010 519,101 1.064 552,323 208,696 2.647
2010-2011 272,478 1.059 288,554 196,436 1.469
2011-2012 335,387 1.054 353,498 198,618 1.780
2012-2013 272,990 1.049 286,367 197,878 1.447
2013-2014 177,158 1.044 184,953 195,422 0.946
2014-2015 734,563 1.039 763,211 191,245 3.991
2015-2016 266,931 1.034 276,007 185,721 1.486
2016-2017 271,070 1.030 279,202 187,312 1.491
2017-2018 158,998 1.025 162,973 193,028 0.844
2018-2019 248,608 1.020 253,580 202,100 1.255
2019-2020 426,000 1.015 432,390 212,341 2.036
2020-2021 727,000 1.010 734,270 184,958 3.970
2021-2022 627,000 1.005 630,135 184,893 3.408
2022-2023 593,000 1.000 593,000 184,893 3.207
Totals $6,987,698 $7,246,750 3,543,369 $2.045
16/17-20/21 1,831,676 1,862,415 979,739 1.901
19/20-21/22 1,780,000 1,796,795 582,192 3.086
20/21-22/23 1,947,000 1,957,405 554,744 3.528
(F) Selected Limited Rate: $3.300
Prior:

Program Year: 2022-2023 2023-2024

1.978 2.059

1.000 1.005
$6.344 $6.829
184,893 189,515
1,173,000 1,294,000
00 *
Factor to N:

+
Trend Factor:

,
Program Rate:

-
Trended Payroll ($00):

Projected Program Losses:

/
Projected ULAE:

0 Projected Loss and ULAE: $1,173,000 $1,294,000
Notes appear on the next page.
44 48
Exhibit 4

Page 2 ends

City of San Clemente - Liability
Selection of Projected Limited Loss Rate
and Projection of Program Losses and ALAE
Notes:
(A) From Exhibit 3, Page 2, Column (F).

For purposes of projecting future losses, losses
are capped at $100,000 per occurrence.
(B) From Appendix E, Page 1, Column (B).
(C) (A) x (B).
(D) Appendix K, Column (C).
(E) (C) / (D).
(F) Selected based on (E).
(G) Based on a Burr distribution, a mathematical model
of claims sizes. 2022-2023 is (K) / (A).
(H) From Appendix E.
(I) (F) x (G) x (H). 2022-2023 is (K) / (J).
(J) Appendix K, Column (C).
(K) (I) x (J). 2022-2023 is from Exhibit 3, Page 1.
(L) Based on an estimated claim closing pattern and the City's historical claims administration expenses.
(M) (K) + (L).

This exhibit shows the calculation of future loss costs based on the past loss rates. The projections will be accurate only to the extent that what has happened in the past is representative of what will happen in the future. 45 49
Appendix A

Page 1 ends

City of San Clemente - Liability
Reported Loss Development
Limited Reported Program Reported
Reported Loss Ultimate Reported Loss Ultimate
Accident Losses as Development Limited Losses as Development Program Year of 12/31/22 Factor Losses of 12/31/22 Factor Losses (A) (B) (C) (D) (E) (F) (G)
2005-2006 38,028 1.000 38,028 38,028 1.000 38,028
2006-2007 370,580 1.000 370,580 738,196 1.000 738,196
2007-2008 187,085 1.000 187,085 337,085 1.000 337,085
2008-2009 761,721 1.000 761,721 1,361,721 1.000 1,361,721 2009-2010 519,101 1.000 519,101 844,729 1.000 844,729
2010-2011 272,478 1.000 272,478 572,478 1.000 572,478
2011-2012 335,387 1.000 335,387 427,370 1.000 427,370
2012-2013 272,990 1.000 272,990 572,990 1.000 572,990
2013-2014 177,158 1.000 177,158 327,158 1.000 327,158
2014-2015 734,563 1.000 734,563 1,427,034 1.000 1,427,034 2015-2016 266,931 1.000 266,931 420,423 1.000 420,423
2016-2017 271,070 1.000 271,070 440,266 1.003 441,587
2017-2018 158,998 1.000 158,998 158,998 1.008 160,270
2018-2019 248,608 1.005 249,851 548,608 1.030 565,066
2019-2020 420,875 1.011 425,505 629,833 1.088 685,258
2020-2021 692,377 1.050 726,996 1,421,309 1.253 1,780,900 2021-2022 467,677 1.339 626,220 767,677 1.829 1,404,081 2022-2023 54,491 4.017 218,890 54,491 5.966 325,093
Totals $6,250,118 $6,613,551 $11,088,394 $12,429,468
Notes:

$
Years are 7/1 to 6/30.

%
Provided by the City. These losses exclude
amounts over $100,000 per occurrence.

&
From Appendix A, Page 2.

'
(B) x (C). These estimated losses exclude
amounts over $100,000 per occurrence.

(
Losses capped at . Amounts are provided by the City.

)
Derived from factors on Appendix A, Page 4.

*
(E) x (F).

This method tends to understate ultimate losses for the most recent several years because the large losses for those years generally have not yet emerged at the time of our review.

This exhibit shows the calculation of estimated ultimate losses for each year based on paid losses and case reserves as reported by the claims administrator. These losses tend to "develop" or change from period to period as more information becomes available about the cases. This development tends to follow quantifiable patterns over time.
46 50
Appendix A

Page 2 ends

City of San Clemente - Liability
Reported Loss Development
Limited Losses Reported as of:

Accident 6 18 30 42 54 66 78 90 102 114 126
Year Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009 761,721
2009-2010 519,101 519,101
2010-2011 272,478 272,478 272,478
2011-2012 335,387 335,387 335,387 335,387
2012-2013 272,990 272,990 272,990 272,990 272,990
2013-2014 177,158 177,158 177,158 177,158 177,158
2014-2015 684,563 734,563 734,563 734,563 734,563
2015-2016 266,931 266,931 266,931 266,931 266,931
2016-2017 240,460 271,070 271,070 271,070 271,070
2017-2018 345,991 161,009 158,998 158,998 158,998
2018-2019 125,128 456,111 329,083 248,608 248,608
2019-2020 264,423 273,133 385,437 420,875
2020-2021 302,758 660,571 692,377
2021-2022 118,780 467,677
2022-2023 54,491
Reported Loss Development Factors:
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009 1.000
2009-2010 1.000 1.000
2010-2011 1.000 1.000 1.000
2011-2012 1.000 1.000 1.000 1.000
2012-2013 1.000 1.000 1.000 1.000
2013-2014 1.000 1.000 1.000 1.000
2014-2015 1.073 1.000 1.000 1.000
2015-2016 1.000 1.000 1.000 1.000
2016-2017 1.127 1.000 1.000 1.000
2017-2018 0.465 0.988 1.000 1.000
2018-2019 3.645 0.721 0.755 1.000
2019-2020 1.033 1.411 1.092
2020-2021 2.182 1.048
2021-2022 3.937
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 Months Months Months Months Months Months Months Months Months Months Months Average 2.699 0.911 0.991 1.000 1.018 1.000 1.000 1.000 1.000 1.000 1.000 Dollar-Wtd. Avgs.

Total 2.290 0.903 0.985 1.000 1.036 1.000 1.000 1.000 1.000 1.000 1.000 3-yr 2.043 1.012 0.946 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 4-yr 2.290 0.903 0.985 1.000 1.036 1.000 1.000 1.000 1.000 1.000 1.000 Comparative
Factors 3.155 1.344 1.039 1.006 1.001 1.002 1.003 1.005 1.005 1.003 1.002 Prior 0.000 1.470 1.120 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Selected 3.000 1.275 1.039 1.006 1.005 1.000 1.000 1.000 1.000 1.000 1.000 Cumulated 4.017 1.339 1.050 1.011 1.005 1.000 1.000 1.000 1.000 1.000 1.000 47 51
Accident
Year
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
2021-2022
2022-2023
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
2021-2022
Average
Dollar-Wtd. Avgs
Total
3-yr
4-yr
Comparative
Factors
Prior
Selected
Cumulated
Appendix A

Page 3 ends

City of San Clemente - Liability
Reported Loss Development
Limited Losses Reported as of:
138 150 162 174 186 198 210
Months Months Months Months Months Months Months
38,028 38,028 38,028 38,028 38,028
370,580 370,580 370,580 370,580 370,580
187,085 187,085 187,085 187,085 187,085
761,721 761,721 761,721 761,721
519,101 519,101 519,101
272,478 272,478
335,387
Reported Loss Development Factors:
138-150 150-162 162-174 174-186 186-198 198-210 210-Ult.

Months Months Months Months Months Months Months

1.000 1.000 1.000 1.000

1.000 1.000 1.000

1.000 1.000

1.000
138-150 150-162 162-174 174-186 186-198 198-210 210-Ult.

Months Months Months Months Months Months Months

1.000 1.000 1.000 1.000 1.000 1.000

1.000 1.000 1.000 1.000

1.000 1.000 1.000

1.003 1.003 1.002 1.002 1.002 1.002 1.006

1.000 1.000 1.000 1.000 1.000 1.000 1.000

1.000 1.000 1.000 1.000 1.000 1.000 1.000
48 52
Appendix A

Page 4 ends

City of San Clemente - Liability
Reported between $100,000 and $500,000 Loss Development Losses Reported as of:

Accident 6 18 30 42 54 66 78 90 102 114 126
Year Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009 956,868
2009-2010 575,629 575,629
2010-2011 800,000 800,000 800,000
2011-2012 91,983 91,983 91,983 91,983
2012-2013 556,314 556,314 556,314 556,314 556,314
2013-2014 295,000 294,212 294,212 294,212 294,212
2014-2015 1,065,595 1,443,612 1,442,470 1,442,470 1,442,470 2015-2016 403,492 384,194 384,194 384,194 384,194
2016-2017 276,635 685,872 419,196 419,196 419,196
2017-2018 288,153
2018-2019 200,002 750,000 1,042,656 493,053 493,053
2019-2020 281,323 280,318 491,872 208,958
2020-2021 601,536 801,535 1,510,591
2021-2022 50,000 350,000
2022-2023
Reported Loss Development Factors:
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009 1.000
2009-2010 1.000 1.000
2010-2011 1.000 1.000 1.000
2011-2012 1.000 1.000 1.000 1.000
2012-2013 1.000 1.000 1.000 1.000
2013-2014 0.997 1.000 1.000 1.000
2014-2015 1.355 0.999 1.000 1.000
2015-2016 0.952 1.000 1.000 1.000
2016-2017 2.479 0.611 1.000 1.000
2017-2018
2018-2019 3.750 1.390 0.473 1.000
2019-2020 0.996 1.755 0.425
2020-2021 1.332 1.885
2021-2022 7.000
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 Months Months Months Months Months Months Months Months Months Months Months Average 3.270 1.677 1.126 0.854 1.118 0.999 1.000 1.000 1.000 1.000 1.000 Dollar-Wtd. Avgs.

Total 1.926 1.662 0.766 0.819 1.202 0.999 1.000 1.000 1.000 1.000 1.000 3-yr 1.535 1.662 0.999 1.000 1.000 1.000 1.000 1.000
4-yr 1.926 0.999 1.000 1.000 1.000 1.000 1.000
Comparative
Factors 3.914 1.840 1.319 1.118 1.040 1.020 1.015 1.014 1.009 1.003 1.003 Prior 0.000 2.750 1.900 1.380 1.270 1.130 1.100 1.080 1.070 1.055 1.050 Selected 3.914 1.840 1.319 1.118 1.040 1.010 1.005 1.001 1.000 1.000 1.000 Cumulated 11.229 2.869 1.559 1.182 1.057 1.016 1.006 1.001 1.000 1.000 1.000 49 53
Accident
Year
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
2021-2022
2022-2023
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
2021-2022
Average
Dollar-Wtd. Avgs
Total
3-yr
4-yr
Comparative
Factors
Prior
Selected
Cumulated
Appendix A

Page 5 ends

City of San Clemente - Liability
Reported between $100,000 and $500,000 Loss Development Losses Reported as of:
138 150 162 174 186 198
Months Months Months Months Months Months
867,616 867,616 867,616 867,616 867,616
400,000 400,000 400,000 400,000 400,000
956,868 956,868 956,868 956,868
575,629 575,629 575,629
800,000 800,000
91,983
Reported Loss Development Factors:
138-150 150-162 162-174 174-186 186-198 198-Ult.

Months Months Months Months Months Months

1.000 1.000 1.000 1.000

1.000 1.000 1.000

1.000 1.000

1.000
138-150 150-162 162-174 174-186 186-198 198-Ult.

Months Months Months Months Months Months

1.000 1.000 1.000 1.000 1.000

1.000 1.000 1.000

1.000 1.000

1.004 1.003 1.005 1.004 1.002 1.013

1.040 1.030 1.030 1.025 1.025 1.020

1.000 1.000 1.000 1.000 1.000 1.000

1.000 1.000 1.000 1.000 1.000 1.000
50 54
Appendix B

Page 1 ends

City of San Clemente - Liability
Paid Loss Development
Limited Paid Program Paid
Paid Loss Ultimate Paid Loss Ultimate
Accident Losses as Development Limited Losses as Development Program Year of 12/31/22 Factor Losses of 12/31/22 Factor Losses (A) (B) (C) (D) (E) (F) (G)
2005-2006 38,028 1.000 38,028 38,028 1.000 38,028
2006-2007 370,580 1.000 370,580 738,196 1.000 738,196
2007-2008 187,085 1.000 187,085 337,085 1.000 337,085
2008-2009 761,721 1.000 761,721 1,361,721 1.000 1,361,721 2009-2010 519,101 1.000 519,101 844,729 1.000 844,729
2010-2011 272,478 1.000 272,478 572,478 1.000 572,478
2011-2012 335,387 1.000 335,387 427,370 1.000 427,370
2012-2013 272,990 1.000 272,990 572,990 1.000 572,990
2013-2014 177,158 1.000 177,158 327,158 1.003 328,139
2014-2015 734,563 1.000 734,563 1,427,034 1.007 1,437,023 2015-2016 266,931 1.000 266,931 420,423 1.014 426,309
2016-2017 271,070 1.005 272,425 440,266 1.029 453,034
2017-2018 158,998 1.015 161,383 158,998 1.085 172,513
2018-2019 248,608 1.060 263,524 548,608 1.205 661,073
2019-2020 366,253 1.214 444,631 536,799 1.523 817,545
2020-2021 437,245 1.700 743,317 832,481 2.485 2,068,715 2021-2022 163,976 3.655 599,332 267,704 6.264 1,676,898 2022-2023 891 31.981 28,495 891 62.578 55,757
Totals $5,583,063 $6,449,130 $9,852,959 $12,989,603
Notes:

$
Years are 7/1 to 6/30.

%
Provided by the City. These losses exclude
amounts over $100,000 per occurrence.

&
From Appendix B, Page 2.

'
(B) x (C). These estimated losses exclude
amounts over $100,000 per occurrence.

(
Losses capped at . Amounts are provided by the City.

)
Derived from factors on Appendix B, Page 4.

*
(E) x (F).

This method tends to understate ultimate losses for the most recent several years because the large losses for those years generally have not yet emerged at the time of our review.

This exhibit shows the calculation of estimated ultimate losses for each year based on paid losses as reported by the claims administrator. These losses tend to "develop" or change from period to period as more information becomes available about the cases. This development tends to follow quantifiable patterns over time. 51 55
Appendix B

Page 2 ends

City of San Clemente - Liability
Paid Loss Development
Limited Losses Paid as of:

Accident 6 18 30 42 54 66 78 90 102 114 126
Year Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009 761,721
2009-2010 519,101 519,101
2010-2011 272,478 272,478 272,478
2011-2012 335,387 335,387 335,387 335,387
2012-2013 272,990 272,990 272,990 272,990 272,990
2013-2014 177,158 177,158 177,158 177,158 177,158
2014-2015 634,563 734,563 734,563 734,563 734,563
2015-2016 266,931 266,931 266,931 266,931 266,931
2016-2017 61,730 147,225 260,931 271,070 271,070
2017-2018 46,119 158,998 158,998 158,998 158,998
2018-2019 8,481 114,777 247,419 248,608 248,608
2019-2020 46,233 153,191 317,845 366,253
2020-2021 20,750 306,840 437,245
2021-2022 9,642 163,976
2022-2023 891
Paid Loss Development Factors:
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009 1.000
2009-2010 1.000 1.000
2010-2011 1.000 1.000 1.000
2011-2012 1.000 1.000 1.000 1.000
2012-2013 1.000 1.000 1.000 1.000
2013-2014 1.000 1.000 1.000 1.000
2014-2015 1.158 1.000 1.000 1.000
2015-2016 1.000 1.000 1.000 1.000
2016-2017 2.385 1.772 1.039 1.000
2017-2018 3.448 1.000 1.000 1.000
2018-2019 13.534 2.156 1.005 1.000
2019-2020 3.313 2.075 1.152
2020-2021 14.787 1.425
2021-2022 17.006
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 Months Months Months Months Months Months Months Months Months Months Months Average 12.160 2.276 1.386 1.193 1.049 1.000 1.000 1.000 1.000 1.000 1.000 Dollar-Wtd. Avgs.

Total 8.681 1.871 1.172 1.138 1.083 1.000 1.000 1.000 1.000 1.000 1.000 3-yr 8.144 1.744 1.068 1.205 1.015 1.000 1.000 1.000 1.000 1.000 1.000 4-yr 8.681 1.871 1.172 1.138 1.083 1.000 1.000 1.000 1.000 1.000 1.000 Comparative
Factors 4.760 2.200 1.444 1.145 1.044 1.019 1.015 1.011 1.009 1.008 1.006 Prior 0.000 2.500 1.400 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Selected 8.750 2.150 1.400 1.145 1.044 1.010 1.005 1.000 1.000 1.000 1.000 Cumulated 31.981 3.655 1.700 1.214 1.060 1.015 1.005 1.000 1.000 1.000 1.000 52 56
Accident
Year
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
2021-2022
2022-2023
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
2021-2022
Average
Dollar-Wtd. Avgs
Total
3-yr
4-yr
Comparative
Factors
Prior
Selected
Cumulated
Appendix B

Page 3 ends

City of San Clemente - Liability
Paid Loss Development
Limited Losses Paid as of:
138 150 162 174 186 198 210
Months Months Months Months Months Months Months
38,028 38,028 38,028 38,028 38,028
370,580 370,580 370,580 370,580 370,580
187,085 187,085 187,085 187,085 187,085
761,721 761,721 761,721 761,721
519,101 519,101 519,101
272,478 272,478
335,387
Paid Loss Development Factors:
138-150 150-162 162-174 174-186 186-198 198-210 210-Ult.

Months Months Months Months Months Months Months

1.000 1.000 1.000 1.000

1.000 1.000 1.000

1.000 1.000

1.000
138-150 150-162 162-174 174-186 186-198 198-210 210-Ult.

Months Months Months Months Months Months Months

1.000 1.000 1.000 1.000 1.000 1.000

1.000 1.000 1.000 1.000

1.000 1.000 1.000

1.006 1.004 1.004 1.004 1.002 1.002 1.009

1.000 1.000 1.000 1.000 1.000 1.000 1.000

1.000 1.000 1.000 1.000 1.000 1.000 1.000
53 57
Appendix B

Page 4 ends

City of San Clemente - Liability
Paid between $100,000 and $500,000 Loss Development
Losses Paid as of:

Accident 6 18 30 42 54 66 78 90 102 114 126
Year Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009 956,868
2009-2010 575,629 575,629
2010-2011 800,000 800,000 800,000
2011-2012 91,983 91,983 91,983 91,983
2012-2013 556,314 556,314 556,314 556,314 556,314
2013-2014 293,026 294,212 294,212 294,212 294,212
2014-2015 762,209 1,178,861 1,442,470 1,442,470 1,442,470 2015-2016 251,148 384,194 384,194 384,194 384,194
2016-2017 19,196 69,089 419,196
2017-2018
2018-2019 402,312 493,053 493,053
2019-2020 257,543 406,851 170,546
2020-2021 448,128 729,030
2021-2022 103,728
2022-2023
Paid Loss Development Factors:
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009 1.000
2009-2010 1.000 1.000
2010-2011 1.000 1.000 1.000
2011-2012 1.000 1.000 1.000 1.000
2012-2013 1.000 1.000 1.000 1.000
2013-2014 1.004 1.000 1.000 1.000
2014-2015 1.547 1.224 1.000 1.000
2015-2016 1.530 1.000 1.000 1.000
2016-2017 3.599 6.067
2017-2018
2018-2019 1.226 1.000
2019-2020 1.580 0.419
2020-2021 1.627
2021-2022
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 Months Months Months Months Months Months Months Months Months Months Months Average 1.604 0.823 1.265 2.049 2.324 1.000 1.000 1.000 1.000 1.000 Dollar-Wtd. Avgs.

Total 1.610 0.820 1.179 1.400 1.319 1.000 1.000 1.000 1.000 1.000 3-yr 1.376 1.000 1.000 1.000 1.000 1.000
4-yr 1.319 1.000 1.000 1.000 1.000 1.000
Comparative
Factors 38.826 4.564 2.255 1.469 1.201 1.111 1.051 1.032 1.027 1.017 1.008 Prior 0.000 4.000 3.100 2.400 1.750 1.500 1.300 1.250 1.175 1.100 1.080 Selected 38.826 4.564 2.255 1.469 1.201 1.111 1.025 1.015 1.010 1.005 1.001 Cumulated 827.537 21.314 4.670 2.071 1.410 1.174 1.057 1.031 1.016 1.006 1.001 54 58
Accident
Year
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
2021-2022
2022-2023
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
2021-2022
Average
Dollar-Wtd. Avgs
Total
3-yr
4-yr
Comparative
Factors
Prior
Selected
Cumulated
Appendix B

Page 5 ends

City of San Clemente - Liability
Paid between $100,000 and $500,000 Loss Development
Losses Paid as of:
138 150 162 174 186 198
Months Months Months Months Months Months
867,616 867,616 867,616 867,616 867,616
400,000 400,000 400,000 400,000 400,000
956,868 956,868 956,868 956,868
575,629 575,629 575,629
800,000 800,000
91,983
Paid Loss Development Factors:
138-150 150-162 162-174 174-186 186-198 198-Ult.

Months Months Months Months Months Months

1.000 1.000 1.000 1.000

1.000 1.000 1.000

1.000 1.000

1.000
138-150 150-162 162-174 174-186 186-198 198-Ult.

Months Months Months Months Months Months

1.000 1.000 1.000 1.000 1.000

1.000 1.000 1.000

1.000 1.000

1.007 1.007 1.009 1.009 1.007 1.037

1.070 1.055 1.045 1.035 1.035 1.030

1.000 1.000 1.000 1.000 1.000 1.000

1.000 1.000 1.000 1.000 1.000 1.000
55 59
Appendix C

Page 1 ends

City of San Clemente - Liability
Exposure and Development Method
Based on Reported Losses
Reported Percentage Incurred
Trended Reported Loss of Losses but not Ultimate
Accident Payroll Losses as Development Yet to Be Program Reported Program Year ($00) of 12/31/22 Factor Reported Rate (IBNR) Losses (A) (B) (C) (D) (E) (F) (G)
2005-2006 198,386 38,028 1.000 0.000 0.314 0 38,028
2006-2007 200,199 738,196 1.000 0.000 3.067 0 738,196
2007-2008 205,491 337,085 1.000 0.000 1.530 0 337,085
2008-2009 215,752 1,361,721 1.000 0.000 6.020 0 1,361,721 2009-2010 208,696 844,729 1.000 0.000 4.300 0 844,729
2010-2011 196,436 572,478 1.000 0.000 2.431 0 572,478
2011-2012 198,618 427,370 1.000 0.000 2.996 0 427,370
2012-2013 197,878 572,990 1.000 0.000 2.481 0 572,990
2013-2014 195,422 327,158 1.000 0.000 1.653 0 327,158
2014-2015 191,245 1,427,034 1.000 0.000 7.090 0 1,427,034 2015-2016 185,721 420,423 1.000 0.000 2.687 0 420,423
2016-2017 187,312 440,266 1.003 0.003 2.741 1,540 441,806 2017-2018 193,028 158,998 1.008 0.008 5.773 8,915 167,913 2018-2019 202,100 548,608 1.030 0.029 5.865 34,374 582,982 2019-2020 212,341 629,833 1.088 0.081 5.966 102,613 732,446 2020-2021 184,958 1,421,309 1.253 0.202 6.068 226,710 1,648,019 2021-2022 184,893 767,677 1.829 0.453 6.174 517,113 1,284,790 2022-2023 184,893 54,491 5.966 0.832 6.278 965,751 1,020,242 Totals 3,543,369 $11,088,394 $1,857,016 $12,945,410
Notes:

$
Appendix K, Column (C).

%
Provided by the City. These losses exclude amounts
incurred above for each year.

&
From Appendix A, Page 1, Column (F).

'
1 - 1 / (C).

(
From Appendix C, Page 3, Column (H).

)
(A) x (D) x (E).

*
(B) + (F).

This exhibit shows the calculation of ultimate losses based on the assumption that there is an underlying relationship between losses and exposure that changes in regular ways over time. The method relies on the premise that the losses that are currently unreported will cost what this relationship would suggest. 56 60
Appendix C

Page 2 ends

City of San Clemente - Liability
Exposure and Development Method
Based on Paid Losses
Paid Percentage
Trended Paid Loss of Losses Incurred Ultimate
Accident Payroll Losses as Development Yet to Be Program but not Program Year ($00) of 12/31/22 Factor Paid Rate Paid Losses
(A) (B) (C) (D) (E) (F) (G)
2005-2006 198,386 38,028 1.000 0.000 0.314 0 38,028
2006-2007 200,199 738,196 1.000 0.000 3.067 0 738,196
2007-2008 205,491 337,085 1.000 0.000 1.530 0 337,085
2008-2009 215,752 1,361,721 1.000 0.000 6.020 0 1,361,721 2009-2010 208,696 844,729 1.000 0.000 4.300 0 844,729
2010-2011 196,436 572,478 1.000 0.000 2.431 0 572,478
2011-2012 198,618 427,370 1.000 0.000 2.996 0 427,370
2012-2013 197,878 572,990 1.000 0.000 2.481 0 572,990
2013-2014 195,422 327,158 1.003 0.003 1.653 969 328,127 2014-2015 191,245 1,427,034 1.007 0.007 7.090 9,491 1,436,525 2015-2016 185,721 420,423 1.014 0.014 2.687 6,986 427,409 2016-2017 187,312 440,266 1.029 0.028 2.741 14,376 454,642 2017-2018 193,028 158,998 1.085 0.078 5.773 86,919 245,917 2018-2019 202,100 548,608 1.205 0.170 5.865 201,504 750,112 2019-2020 212,341 536,799 1.523 0.343 5.966 434,521 971,320 2020-2021 184,958 832,481 2.485 0.598 6.068 671,150 1,503,631 2021-2022 184,893 267,704 6.264 0.840 6.174 958,885 1,226,589 2022-2023 184,893 891 62.578 0.984 6.278 1,142,186 1,143,077 Totals 3,543,369 $9,852,959 $3,526,989 $13,379,948
Notes:

$
Appendix K, Column (C).

%
Provided by the City. These losses exclude
amounts paid above for each year.

&
From Appendix B, Page 1, Column (F).

'
1 - 1 / (C).

(
From Appendix C, Page 3, Column (H).

)
(A) x (D) x (E).

*
(B) + (F).

This exhibit shows the calculation of ultimate losses based on the assumption that there is an underlying relationship between losses and exposure that changes in regular ways over time. The method relies on the premise that the losses that are currently unpaid will cost what this relationship would suggest. 57 61
Appendix C

Page 3 ends

City of San Clemente - Liability
Exposure and Development Method
Trended Ultimate Trended Trended
Accident Payroll Limited Trend Limited Limited Limited Factor to Program Year ($00) Losses Factor Losses Loss Rate Loss Rate Loss Rate (A) (B) (C) (D) (E) (F) (G) (H)
2005-2006 198,386 38,028 1.084 41,222 0.208 0.192 1.633 0.314 2006-2007 200,199 370,580 1.079 399,856 1.997 1.851 1.657 3.067 2007-2008 205,491 187,085 1.074 200,929 0.978 0.910 1.681 1.530 2008-2009 215,752 761,721 1.069 814,280 3.774 3.531 1.705 6.020 2009-2010 208,696 519,101 1.064 552,323 2.647 2.487 1.729 4.300 2010-2011 196,436 272,478 1.059 288,554 1.469 1.387 1.753 2.431 2011-2012 198,618 335,387 1.054 353,498 1.780 1.689 1.774 2.996 2012-2013 197,878 272,990 1.049 286,367 1.447 1.380 1.798 2.481 2013-2014 195,422 177,158 1.044 184,953 0.946 0.907 1.822 1.653 2014-2015 191,245 734,563 1.039 763,211 3.991 3.841 1.846 7.090 2015-2016 185,721 266,931 1.034 276,007 1.486 1.437 1.870 2.687 2016-2017 187,312 271,070 1.030 279,202 1.491 1.447 1.894 2.741 2017-2018 193,028 158,998 1.025 162,973 0.844 3.010 1.918 5.773 2018-2019 202,100 248,608 1.020 253,580 1.255 3.025 1.939 5.865 2019-2020 212,341 426,000 1.015 432,390 2.036 3.039 1.963 5.966 2020-2021 184,958 727,000 1.010 734,270 3.970 3.054 1.987 6.068 2021-2022 184,893 627,000 1.005 630,135 3.408 3.070 2.011 6.174 2022-2023 184,893 219,000 1.000 219,000 1.184 3.085 2.035 6.278 Total/Avg 3,543,369 $6,613,698 $6,872,750 $1.940
16/17-20/21 979,739 1,831,676 1,862,415 1.901
19/20-21/22 582,192 1,780,000 1,796,795 3.086
Selected Limited Rate: $3.085
Prior:

Notes:
(A) Appendix K, Column (C).
(B) Selected average of results from Appendices A and B. (C) From Appendix E, Page 1, Column (B).
(D) (B) x (C).
(E) (D) / (A).
(F) Selected Limited Rate / (C). For 2016-2017 and prior (B) / (A). (G) Based on a Burr distribution, a mathematical model
of claim sizes.
(H) (F) x (G).

This exhibit shows the calculation of the underlying historical relationship between losses and exposure that is needed to apply the estimation methods shown on pages 1 and 2 of this Appendix. 58 62
Appendix D

Page 1 ends

City of San Clemente - Liability
Frequency and Severity Method
Ultimate Adjusted Ultimate
Accident Program Ultimate Program
Year Severity Claims Losses
(A) (B) (C)
2005-2006 1,679 37 62,123
2006-2007 21,175 29 614,075
2007-2008 6,290 50 314,500
2008-2009 31,677 41 1,298,757
2009-2010 27,197 33 897,501
2010-2011 9,748 49 477,652
2011-2012 19,193 31 594,983
2012-2013 12,271 40 490,840
2013-2014 7,173 45 322,785
2014-2015 41,090 33 1,355,970
2015-2016 14,262 35 499,170
2016-2017 14,669 35 513,415
2017-2018 23,720 37 877,640
2018-2019 24,588 50 1,229,400
2019-2020 25,517 35 893,095
2020-2021 26,469 34 899,946
2021-2022 27,468 42 1,153,656
2022-2023 28,490 38 1,082,620
Total 694 $13,578,128
Notes:
(A) From Appendix D, Page 2, Column (H).
(B) From Appendix D, Page 2, Column (B).
(C) (A) x (B).

This exhibit shows the calculation of the estimated
ultimate losses for each year based on the
observed average frequency and severity of
claims.
59 63
Appendix D

Page 2 ends

City of San Clemente - Liability
Frequency and Severity Method
Ultimate Adjusted Ultimate Trended
Accident Limited Ultimate Limited Trend Limited Limited Factor to Program Year Losses Claims Severity Factor Severity Severity Severity (A) (B) (C) (D) (E) (F) (G) (H)
2005-2006 38,028 37 1,028 1.521 1,564 1,028 1.633 1,679 2006-2007 370,580 29 12,779 1.484 18,964 12,779 1.657 21,175 2007-2008 187,085 50 3,742 1.448 5,418 3,742 1.681 6,290 2008-2009 761,721 41 18,579 1.412 26,234 18,579 1.705 31,677 2009-2010 519,101 33 15,730 1.378 21,676 15,730 1.729 27,197 2010-2011 272,478 49 5,561 1.344 7,474 5,561 1.753 9,748 2011-2012 335,387 31 10,819 1.312 14,195 10,819 1.774 19,193 2012-2013 272,990 40 6,825 1.280 8,736 6,825 1.798 12,271 2013-2014 177,158 45 3,937 1.249 4,917 3,937 1.822 7,173 2014-2015 734,563 33 22,259 1.218 27,111 22,259 1.846 41,090 2015-2016 266,931 35 7,627 1.188 9,061 7,627 1.870 14,262 2016-2017 271,070 35 7,745 1.160 8,984 7,745 1.894 14,669 2017-2018 158,998 37 4,297 1.132 4,864 12,367 1.918 23,720 2018-2019 248,608 50 4,972 1.104 5,489 12,681 1.939 24,588 2019-2020 426,000 35 12,171 1.077 13,108 12,999 1.963 25,517 2020-2021 727,000 34 21,382 1.051 22,472 13,321 1.987 26,469 2021-2022 627,000 42 14,929 1.025 15,302 13,659 2.011 27,468 2022-2023 519,000 38 13,658 1.000 13,658 14,000 2.035 28,490 Average Limited Severity: $12,735
Average 16/17-20/21 Limited Severity: 10,983
Average 17/18-21/22 Limited Severity: 12,247
Selected Limited Severity: $14,000
Prior:

Notes:
(A) Selected average of results from Appendices A, B, and C. (B) Appendix D, Page 3, Column (C).
(C) (A) / (B).
(D) From Appendix E, Page 1, Column (J).
(E) (C) x (D).
(F) Selected Limited Severity / (D).
(G) Based on a Burr distribution, a mathematical model
of claim sizes.
(H) (F) x (G).

This exhibit shows the calculation of the historical average cost per claim, or severity. The observed average severity is used in the method shown on page 1 of this Appendix. 60 64
Appendix D

Page 3 ends

City of San Clemente - Liability
Frequency and Severity Method
Projection of Ultimate Claims
Reported Closed Selected Trended Trended
Accident Claim Claim Ultimate Payroll Claim Trend Claim Year Development Development Claims ($000,000) Frequency Factor Frequency (A) (B) (C) (D) (E) (F) (G)
2005-2006 37 37 37 19.8 1.865 0.710 1.324
2006-2007 29 29 29 20.0 1.449 0.725 1.051
2007-2008 50 50 50 20.5 2.433 0.740 1.800
2008-2009 41 41 41 21.6 1.900 0.755 1.435
2009-2010 33 33 33 20.9 1.581 0.769 1.216
2010-2011 49 48 49 19.6 2.494 0.785 1.958
2011-2012 31 31 31 19.9 1.561 0.801 1.250
2012-2013 40 40 40 19.8 2.021 0.817 1.651
2013-2014 45 45 45 19.5 2.303 0.834 1.921
2014-2015 33 33 33 19.1 1.726 0.851 1.469
2015-2016 35 35 35 18.6 1.885 0.868 1.636
2016-2017 35 35 35 18.7 1.869 0.886 1.656
2017-2018 37 38 37 19.3 1.917 0.904 1.733
2018-2019 50 52 50 20.2 2.474 0.922 2.281
2019-2020 35 34 35 21.2 1.648 0.942 1.552
2020-2021 34 30 34 18.5 1.838 0.961 1.766
2021-2022 41 43 42 18.5 2.272 0.980 2.227
2022-2023 26 28 38 18.5 2.055 1.000 2.055
Total 681 682 694 354.3 1.659
17/18-21/22 197 197 198 97.7 1.907
(H) Selected Frequency: 2.025
Prior:

Program Year: 2022-2023 2023-2024
(I) Trend Factor: 1.000 0.980
(J) Selected Frequency: 2.055 1.985
(K) Est. Payroll ($000,000): 18.5 19.0
(L) Ultimate Claims: 38 38
Notes:
(A) Appendix D, Page 4, (C). (G) (E) x (F).
(B) Appendix D, Page 5, (C). (H) The selected frequency of 2.025 is based on (G). (C) Selected from (A) and (B). (I) Appendix E, Page 1, Column (F). (D) Appendix K, Column (C) / 10,000. (J) (H) x (I). 2022-2023 is (L) / (K). (E) (C) / (D). (K) Appendix K, Column (C) / 10,000.
(F) Appendix E, Page 1, Column (F). (L) (J) x (K). 2022-2023 is (C).

This exhibit summarizes the estimated numbers of claims and shows the estimated frequencies per $1,000,000 of trended payroll. 61 65
Appendix D

Page 4 ends

City of San Clemente - Liability
Frequency and Severity Method
Reported Claim Count Development
Claims Reported
Reported Claim Trended
Accident as of Development Ultimate Claim
Year 12/31/2022 Factor Claims Frequency
(A) (B) (C) (D)
2005-2006 37 1.000 37 1.324
2006-2007 29 1.000 29 1.050
2007-2008 50 1.000 50 1.801
2008-2009 41 1.000 41 1.435
2009-2010 33 1.000 33 1.216
2010-2011 49 1.000 49 1.958
2011-2012 31 1.000 31 1.250
2012-2013 40 1.000 40 1.652
2013-2014 45 1.000 45 1.920
2014-2015 33 1.000 33 1.468
2015-2016 35 1.000 35 1.636
2016-2017 35 1.000 35 1.656
2017-2018 37 1.002 37 1.733
2018-2019 50 1.008 50 2.281
2019-2020 34 1.021 35 1.553
2020-2021 33 1.036 34 1.767
2021-2022 38 1.083 41 2.173
2022-2023 8 3.249 26 1.406
Total 658 681 1.623
Notes:
(A) Provided by the City.
(B) From Appendix D, Page 6.
(C) (A) x (B).
(D) (C) / [Appendix D, Page 3, (D)] x
[Appendix D, Page 3, (F)].

This exhibit shows the calculation of estimated ultimate claims for each year based on reported claims as provided by the City. These numbers of claims tend to "develop" or change from period to period as more claims are filed. This development tends to follow quantifiable patterns over time. 62 66
Appendix D

Page 5 ends

City of San Clemente - Liability
Frequency and Severity Method
Closed Claim Count Development
Claims Closed
Closed Claim Trended
Accident as of Development Ultimate Claim
Year 12/31/2022 Factor Claims Frequency
(A) (B) (C) (D)
2005-2006 37 1.000 37 1.324
2006-2007 29 1.000 29 1.050
2007-2008 50 1.000 50 1.801
2008-2009 41 1.000 41 1.435
2009-2010 33 1.000 33 1.216
2010-2011 48 1.000 48 1.918
2011-2012 31 1.000 31 1.250
2012-2013 40 1.000 40 1.652
2013-2014 45 1.000 45 1.920
2014-2015 33 1.002 33 1.468
2015-2016 35 1.006 35 1.636
2016-2017 34 1.015 35 1.656
2017-2018 37 1.026 38 1.780
2018-2019 50 1.041 52 2.372
2019-2020 32 1.069 34 1.508
2020-2021 27 1.128 30 1.559
2021-2022 32 1.337 43 2.279
2022-2023 3 9.426 28 1.514
Total 637 682 1.626
Notes:
(A) Provided by the City.
(B) From Appendix D, Page 7.
(C) (A) x (B).
(D) (C) / [Appendix D, Page 3, (D)] x
[Appendix D, Page 3, (F)].

This exhibit shows the calculation of estimated ultimate claims for each year based on closed claims as provided by the City. These numbers of closed claims tend to "develop" or change from period to period as more claims are closed. This development tends to follow quantifiable patterns over time. 63 67
Appendix D

Page 6 ends

City of San Clemente - Liability
Reported Claim Count Development
Claims Reported as of:

Accident 6 18 30 42 54 66 78 90 102 114 126 138 150 162 Year Months Months Months Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006 37
2006-2007 29 29
2007-2008 50 50 50
2008-2009 41 41 41 41
2009-2010 33 33 33 33 33
2010-2011 49 49 49 49 49
2011-2012 31 31 31 31 31
2012-2013 40 40 40 40 40
2013-2014 45 45 45 45 45
2014-2015 32 33 33 33 33
2015-2016 35 35 35 35 35
2016-2017 34 35 35 35 35
2017-2018 35 36 36 37 37
2018-2019 15 48 49 49 50
2019-2020 12 32 33 34
2020-2021 6 30 33
2021-2022 16 38
2022-2023 8
Reported Claim Count Development Factors:
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 138-150 150-162 162-174 Months Months Months Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006 1.000
2006-2007 1.000 1.000
2007-2008 1.000 1.000 1.000
2008-2009 1.000 1.000 1.000 1.000
2009-2010 1.000 1.000 1.000 1.000
2010-2011 1.000 1.000 1.000 1.000
2011-2012 1.000 1.000 1.000 1.000
2012-2013 1.000 1.000 1.000 1.000
2013-2014 1.000 1.000 1.000 1.000
2014-2015 1.031 1.000 1.000 1.000
2015-2016 1.000 1.000 1.000 1.000
2016-2017 1.029 1.000 1.000 1.000
2017-2018 1.029 1.000 1.028 1.000
2018-2019 3.200 1.021 1.000 1.020
2019-2020 2.667 1.031 1.030
2020-2021 5.000 1.100
2021-2022 2.375
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 138-150 150-162 162-174 Months Months Months Months Months Months Months Months Months Months Months Months Months Months Average 3.311 1.045 1.015 1.012 1.008 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Claim-Wtd. Avgs.

Total 3.020 1.041 1.013 1.013 1.007 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 3-yr 2.941 1.045 1.008 1.017 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 4-yr 3.020 1.041 1.013 1.013 1.007 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Comparative
Factors 2.653 1.144 1.017 1.010 1.006 1.004 1.005 1.004 1.003 1.003 1.003 1.002 1.003 1.002 Prior 0.000 1.100 1.007 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Selected 3.000 1.045 1.015 1.013 1.006 1.002 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Cumulated 3.249 1.083 1.036 1.021 1.008 1.002 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 64 68
Appendix D

Page 7 ends

City of San Clemente - Liability
Closed Claim Development
Claims Closed as of:

Accident 6 18 30 42 54 66 78 90 102 114 126 138 150 162 Year Months Months Months Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006 37
2006-2007 29 29
2007-2008 50 50 50
2008-2009 41 41 41 41
2009-2010 33 33 33 33 33
2010-2011 48 48 48 48 48
2011-2012 31 31 31 31 31
2012-2013 40 40 40 40 40
2013-2014 44 45 45 45 45
2014-2015 28 30 33 33 33
2015-2016 34 35 35 35 35
2016-2017 32 33 34 34 34
2017-2018 31 35 36 37 37
2018-2019 5 42 46 49 50
2019-2020 2 26 30 32
2020-2021 2 20 27
2021-2022 8 32
2022-2023 3
Closed Claim Count Development Factors:
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 138-150 150-162 162-174 Months Months Months Months Months Months Months Months Months Months Months Months Months Months 2001-2002
2002-2003
2003-2004
2004-2005
2005-2006 1.000
2006-2007 1.000 1.000
2007-2008 1.000 1.000 1.000
2008-2009 1.000 1.000 1.000 1.000
2009-2010 1.000 1.000 1.000 1.000
2010-2011 1.000 1.000 1.000 1.000
2011-2012 1.000 1.000 1.000 1.000
2012-2013 1.000 1.000 1.000 1.000
2013-2014 1.023 1.000 1.000 1.000
2014-2015 1.071 1.100 1.000 1.000
2015-2016 1.029 1.000 1.000 1.000
2016-2017 1.031 1.030 1.000 1.000
2017-2018 1.129 1.029 1.028 1.000
2018-2019 8.400 1.095 1.065 1.020
2019-2020 13.000 1.154 1.067
2020-2021 10.000 1.350
2021-2022 4.000
6-18 18-30 30-42 42-54 54-66 66-78 78-90 90-102 102-114 114-126 126-138 138-150 150-162 162-174 Months Months Months Months Months Months Months Months Months Months Months Months Months Months Average 8.850 1.182 1.048 1.027 1.018 1.031 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Claim-Wtd. Avgs.

Total 7.059 1.160 1.049 1.026 1.015 1.028 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 3-yr 6.500 1.170 1.054 1.025 1.000 1.030 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 4-yr 7.059 1.160 1.049 1.026 1.015 1.028 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Comparative
Factors 3.720 1.528 1.096 1.038 1.019 1.011 1.009 1.008 1.008 1.006 1.004 1.005 1.004 1.004 Prior 0.000 1.600 1.080 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Selected 7.050 1.185 1.055 1.027 1.015 1.011 1.009 1.004 1.002 1.000 1.000 1.000 1.000 1.000 Cumulated 9.426 1.337 1.128 1.069 1.041 1.026 1.015 1.006 1.002 1.000 1.000 1.000 1.000 1.000 65 69
Appendix E

Page 1 ends

City of San Clemente - Liability
Loss Trend Factors
Factor to Factor to Factor to Factor to Factor to Factor to Factor to Factor to Factor to Benefit 2022-2023 2023-2024 2024-2025 2025-2026 2022-2023 2023-2024 2024-2025 2025-2026 2022-2023 Accident Level Loss Rate Loss Rate Loss Rate Loss Rate Frequency Frequency Frequency Frequency Severity Year Factor Level Level Level Level Level Level Level Level Level (A) (B) (C) (D) (E) (F) (G) (H) (I) (J)
2001-2002 1.000 1.107 1.113 1.118 1.124 0.655 0.642 0.629 0.616 1.679 2002-2003 1.000 1.101 1.107 1.112 1.118 0.668 0.655 0.642 0.629 1.638 2003-2004 1.000 1.096 1.101 1.106 1.112 0.682 0.669 0.655 0.642 1.598 2004-2005 1.000 1.090 1.095 1.100 1.106 0.696 0.682 0.668 0.655 1.559 2005-2006 1.000 1.084 1.089 1.095 1.100 0.710 0.696 0.682 0.668 1.521 2006-2007 1.000 1.079 1.084 1.090 1.095 0.725 0.710 0.696 0.682 1.484 2007-2008 1.000 1.074 1.079 1.085 1.090 0.740 0.725 0.710 0.696 1.448 2008-2009 1.000 1.069 1.074 1.080 1.085 0.755 0.740 0.724 0.710 1.412 2009-2010 1.000 1.064 1.069 1.075 1.080 0.769 0.754 0.739 0.724 1.378 2010-2011 1.000 1.059 1.064 1.070 1.075 0.785 0.770 0.754 0.739 1.344 2011-2012 1.000 1.054 1.059 1.065 1.070 0.801 0.785 0.769 0.754 1.312 2012-2013 1.000 1.049 1.054 1.060 1.065 0.817 0.801 0.785 0.769 1.280 2013-2014 1.000 1.044 1.050 1.055 1.060 0.834 0.818 0.801 0.785 1.249 2014-2015 1.000 1.039 1.045 1.050 1.055 0.851 0.834 0.817 0.801 1.218 2015-2016 1.000 1.034 1.040 1.045 1.050 0.868 0.851 0.834 0.817 1.188 2016-2017 1.000 1.030 1.035 1.040 1.045 0.886 0.869 0.851 0.834 1.160 2017-2018 1.000 1.025 1.030 1.035 1.040 0.904 0.886 0.868 0.851 1.132 2018-2019 1.000 1.020 1.025 1.030 1.035 0.922 0.904 0.886 0.868 1.104 2019-2020 1.000 1.015 1.020 1.025 1.030 0.942 0.923 0.904 0.886 1.077 2020-2021 1.000 1.010 1.015 1.020 1.025 0.961 0.942 0.922 0.904 1.051 2021-2022 1.000 1.005 1.010 1.015 1.020 0.980 0.960 0.941 0.922 1.025 2022-2023 1.000 1.000 1.005 1.010 1.015 1.000 0.980 0.960 0.941 1.000 2023-2024 1.000 -- 1.000 1.005 1.010 -- 1.000 0.980 0.960 -- 2024-2025 1.000 -- -- 1.000 1.005 -- -- 1.000 0.980 --
2025-2026 1.000 -- -- -- 1.000 -- -- -- 1.000 --
Notes:
(A) No benefit level adjustment applied.
(B) - (E) (A) adjusted for a 0.5% annual loss rate trend. (F) - (I) (A) adjusted for a -2.0% annual frequency trend. (J) (A) adjusted for a 2.5% annual severity trend.

This exhibit shows the calculation of the ways in which we expect claims costs to have changed over the past twenty years due to changes in inflation.
66 70
Appendix E

Page 2 ends

City of San Clemente - Liability
Residual Trend Factors
Initial
Estimate of
Ultimate Ultimate Adjusted Trended
Accident Limited Reported Limited Payroll Ultimate
Year Losses Claims BLF Severity ($00) Frequency
(A) (B) (C) (D) (E) (F)
2001-2002 0 1.000
2002-2003 0 1.000
2003-2004 0 1.000
2004-2005 0 1.000
2005-2006 38,028 37 1.000 1,028 198,386 1.865
2006-2007 370,580 29 1.000 12,779 200,199 1.449
2007-2008 187,085 50 1.000 3,742 205,491 2.433
2008-2009 761,721 41 1.000 18,579 215,752 1.900
2009-2010 519,101 33 1.000 15,730 208,696 1.581
2010-2011 272,478 49 1.000 5,561 196,436 2.494
2011-2012 335,387 31 1.000 10,819 198,618 1.561
2012-2013 272,990 40 1.000 6,825 197,878 2.021
2013-2014 177,158 45 1.000 3,937 195,422 2.303
2014-2015 734,563 33 1.000 22,259 191,245 1.726
2015-2016 266,931 35 1.000 7,627 185,721 1.885
2016-2017 271,070 35 1.000 7,745 187,312 1.869
2017-2018 158,998 37 1.000 4,297 193,028 1.917
2018-2019 248,608 50 1.000 4,972 202,100 2.474
2019-2020 426,000 35 1.000 12,171 212,341 1.648
2020-2021 727,000 34 1.000 21,382 184,958 1.838
2021-2022 627,000 42 1.000 14,929 184,893 2.272
Severity Trend Factors Frequency Trend Factors
Latest 10 x 2021-2022 1.040 1.004
Mvg 5-Yr Wtd Latest 10 x 2021-2022 0.980 0.999
Latest 5 x 2021-2022 1.360 0.982
Mvg 5-Yr Wtd Latest 5 x 2021-2022 0.989 0.999
Prior 1.025 0.980
Default 1.030 0.975
Selected Residual Trend 1.025 0.980
Notes:
(A) Selected average of results from Appendices A and B. (B) Appendix D, Page 3, Column (C).
(C) Appendix E, Page 1, Column (A).
(D) (A) x (C) / (B).
(E) Appendix K, Column (C).
(F) (B) / (E) x 10,000.
67 71
Appendix F

Page 1 ends

City of San Clemente - Liability
Payment and Reserve Forecast
Calendar Period
1/1/2023 7/1/2023
As of to to
Accident Year 12/31/2022 6/30/2023 6/30/2024
Prior
Ultimate Loss $38,028 $38,028 $38,028
Paid in Calendar Period -
Paid to Date 38,028 38,028 38,028
Outstanding Liability
2006-2007
Ultimate Loss $738,196 $738,196 $738,196
Paid in Calendar Period -
Paid to Date 738,196 738,196 738,196
Outstanding Liability
2007-2008
Ultimate Loss $337,085 $337,085 $337,085
Paid in Calendar Period -
Paid to Date 337,085 337,085 337,085
Outstanding Liability
2008-2009
Ultimate Loss $1,361,721 $1,361,721 $1,361,721
Paid in Calendar Period -
Paid to Date 1,361,721 1,361,721 1,361,721
Outstanding Liability
2009-2010
Ultimate Loss $844,729 $844,729 $844,729
Paid in Calendar Period -
Paid to Date 844,729 844,729 844,729
Outstanding Liability
2010-2011
Ultimate Loss $572,478 $572,478 $572,478
Paid in Calendar Period -
Paid to Date 572,478 572,478 572,478
Outstanding Liability
2011-2012
Ultimate Loss $427,370 $427,370 $427,370
Paid in Calendar Period -
Paid to Date 427,370 427,370 427,370
Outstanding Liability
2012-2013
Ultimate Loss $572,990 $572,990 $572,990
Paid in Calendar Period -
Paid to Date 572,990 572,990 572,990
Outstanding Liability
68 72
Appendix F

Page 2 ends

City of San Clemente - Liability
Payment and Reserve Forecast
Calendar Period
1/1/2023 7/1/2023
As of to to
Accident Year 12/31/2022 6/30/2023 6/30/2024
2013-2014
Ultimate Loss $327,158 $327,158 $327,158
Paid in Calendar Period -
Paid to Date 327,158 327,158 327,158
Outstanding Liability
2014-2015
Ultimate Loss $1,427,034 $1,427,034 $1,427,034
Paid in Calendar Period -
Paid to Date 1,427,034 1,427,034 1,427,034
Outstanding Liability
2015-2016
Ultimate Loss $420,423 $420,423 $420,423
Paid in Calendar Period -
Paid to Date 420,423 420,423 420,423
Outstanding Liability
2016-2017
Ultimate Loss $440,266 $440,266 $440,266
Paid in Calendar Period -
Paid to Date 440,266 440,266 440,266
Outstanding Liability
2017-2018
Ultimate Loss $158,998 $158,998 $158,998
Paid in Calendar Period -
Paid to Date 158,998 158,998 158,998
Outstanding Liability
2018-2019
Ultimate Loss $548,608 $548,608 $548,608
Paid in Calendar Period -
Paid to Date 548,608 548,608 548,608
Outstanding Liability
2019-2020
Ultimate Loss $686,000 $686,000 $686,000
Paid in Calendar Period - 37,748 57,398
Paid to Date 536,799 574,547 631,945
Outstanding Liability 149,201 111,453 54,055
2020-2021
Ultimate Loss $1,576,000 $1,576,000 $1,576,000
Paid in Calendar Period - 157,626 266,581
Paid to Date 832,481 990,107 1,256,688
Outstanding Liability 743,519 585,893 319,312
69 73
Appendix F

Page 3 ends

City of San Clemente - Liability
Payment and Reserve Forecast
Calendar Period
1/1/2023 7/1/2023
As of to to
Accident Year 12/31/2022 6/30/2023 6/30/2024
2021-2022
Ultimate Loss $1,256,000 $1,256,000 $1,256,000
Paid in Calendar Period - 142,315 291,863
Paid to Date 267,704 410,019 701,882
Outstanding Liability 988,296 845,981 554,118
2022-2023
Ultimate Loss $587,000 $1,173,000 $1,173,000
Paid in Calendar Period - 85,564 230,348
Paid to Date 891 86,455 316,803
Outstanding Liability 586,109 1,086,545 856,197
2023-2024
Ultimate Loss - - $1,294,000
Paid in Calendar Period - - 113,872
Paid to Date - - 113,872
Outstanding Liability - - 1,180,128
Totals
Ultimate Loss $12,320,084 $12,906,084 $14,200,084
Paid in Calendar Period - 423,253 960,062
Paid to Date 9,852,959 10,276,212 11,236,274
Outstanding Liability 2,467,125 2,629,872 2,963,810
Total Outstanding ULAE 0 0 0
Outstanding Liability
plus ULAE 2,467,125 2,629,872 2,963,810
Notes appear on the next page.
70 74
Appendix F

Page 4 ends

City of San Clemente - Liability
Payment and Reserve Forecast
Notes to previous page:
· Accident Year is associated with date of loss. Calendar Period is associated with date of transaction. For example, for the losses which occurred during 2020-2021, $157,626 is expected to be paid between 1/1/23 and 6/30/23, $990,107 will have been paid by 6/30/23, and the reserve for remaining payments on these claims should be $585,893. · Ultimate Losses for each accident year are from Exhibit 3, Page 1. · Paid in Calendar Period is a proportion of the Outstanding Liability from the previous calendar period. These proportions are derived from the paid loss development pattern selected in Appendix B. For example, $266,581 = $585,893 x 45.5%. · Paid to Date is Paid in Calendar Period plus Paid to Date from previous calendar period. For example, $1,256,688 = $266,581 + $990,107. · Outstanding Liability is Ultimate Loss minus Paid to Date. For example, $585,893 = $1,576,000 - $990,107.

This exhibit shows the calculation of the liability for outstanding claims as of the date of evaluation, the end of the current fiscal year, and the end of the coming fiscal year. It also shows the expected claims payout during the remainder of the current fiscal year and the coming fiscal year. Refer to the Totals at the end of the exhibit for the balance sheet information. The top parts of the exhibit show information for each program year. 71 75
Appendix G

Page 1 ends

City of San Clemente - Liability
Discount Factors to be Applied to Overall Reserves
Full Value Discounted Full Value Discounted
Accident of Reserve Discount Reserve of Reserve Discount Reserve Year at 12/31/22 Factor at 12/31/22 at 6/30/23 Factor at 6/30/23 (A) (B) (C) (D) (E) (F)
2019-2020 149,201 0.973 145,114 111,453 0.974 108,576
2020-2021 743,519 0.968 719,804 585,893 0.971 568,922
2021-2022 988,296 0.960 949,120 845,981 0.965 816,518
2022-2023 586,109 0.949 555,937 1,086,545 0.956 1,038,246 Totals $2,467,125 $2,369,975 $2,629,872 $2,532,262
(G) Discount Factor at 12/31/22 for Overall Reserve: 0.961 (H) Discount Factor at 6/30/23 for Overall Reserve: 0.963 Notes:
(A) From Appendix F, Outstanding Liability at 12/31/22. (B) Based on Appendix G, Page 2, Column (F).
(C) (A) x (B).
(D) From Appendix F, Outstanding Liability at 6/30/23.
(E) Based on Appendix G, Page 2, Column (F).
(F) (D) x (E).
(G) Total of (C) / Total of (A).
(H) Total of (F) / Total of (D).

This exhibit shows the expected impact of anticipated investment income on the liability for outstanding claims at the date of evaluation and the end of the current fiscal year. For example, if the discount factor in item (G) is 0.961, the discounted liability for outstanding claims is 96.1% of the full value.
72 76
Appendix G

Page 2 ends

City of San Clemente - Liability
Calculation of Discount Factors
Payment Payment Return on Discounted Undiscounted Discount Year Pattern Investment Reserves Reserves Factor
(A) (B) (C) (D) (E) (F)
22 0.0% 2.00% 0.000 0.000 1.000
21 0.0% 2.00% 0.000 0.000 1.000
20 0.0% 2.00% 0.000 0.000 1.000
19 0.0% 2.00% 0.000 0.000 1.000
18 0.0% 2.00% 0.000 0.000 1.000
17 0.0% 2.00% 0.000 0.000 1.000
16 0.0% 2.00% 0.000 0.000 1.000
15 0.0% 2.00% 0.000 0.000 1.000
14 0.0% 2.00% 0.000 0.000 1.000
13 0.0% 2.00% 0.000 0.000 1.000
12 0.0% 2.00% 0.000 0.000 1.000
11 0.2% 2.00% 0.002 0.002 0.990
10 0.3% 2.00% 0.005 0.005 0.982
9 0.7% 2.00% 0.012 0.012 0.979
8 1.1% 2.00% 0.022 0.022 0.974
7 3.4% 2.00% 0.055 0.057 0.976
6 7.4% 2.00% 0.127 0.130 0.976
5 13.4% 2.00% 0.257 0.264 0.974
4 21.4% 2.00% 0.464 0.478 0.970
3 24.6% 2.00% 0.698 0.724 0.965
2 19.0% 2.00% 0.872 0.914 0.955
1 8.6% 2.00% 0.941 1.000 0.941
(G) Discount Factor for Future Funding: 2022-2023 0.950 2023-2024 0.950
Notes:
(A) This is the year of payment relative to the accident year. For example, year 7 refers to payments made in the seventh year after the inception of the accident year. We assume that payments are made at midyear.
(B) Percent of ultimate loss paid this year. This payment pattern is based on the paid loss development pattern selected in Appendix B, Page 2.
(C) Assumed Investment Income Rates.
(D) Discounted Reserves at the beginning of this year is next year's Discounted Reserves discounted one year plus this year's payments discounted six months. For example, in year 2,

87.2% = [69.8% / 1.020] + [19.0% / (1.010)].
(E) Summation of future (B) values. This is the percent of ultimate loss unpaid at the beginning of the year. (F) (D) / (E).
(G) (F) at year 1, with interest accumulated for six months. We assume that the required funding is deposited at the middle of the first year.

This exhibit shows the calculation of the effect of anticipated investment income on future claims costs. Thus, if the discount factor in item (F) is 0.95, on a discounted basis, $0.95 must be budgeted for every $1 that will actually be paid on claims that will be incurred in the next fiscal year. 73 77
Appendix H
City of San Clemente - Liability
Confidence Level Table
Probability Projected Losses Outstanding Losses
95% 1.951 1.593
90% 1.667 1.421
85% 1.496 1.317
80% 1.368 1.239
75% 1.266 1.176
70% 1.180 1.122
65% 1.104 1.075
60% 1.035 1.031
55% 0.972 0.991
50% 0.913 0.953
45% 0.856 0.917
40% 0.801 0.881
35% 0.747 0.846
30% 0.692 0.810
25% 0.637 0.772
To read table: For the above retention, there is a 90% chance that final loss settlements will be less than

1.667 times the average expected amount of losses.

This exhibit shows the loads that must be applied to bring estimated losses at the expected level to the various indicated confidence levels. 74 78
Appendix I
City of San Clemente - Liability
Program History
Policy Policy Self-Insured Retention
Year Year Policy Per
Start Date End Date Year Occurrence Aggregate
7/1/2005 6/30/2006 2005-2006 250,000 (none)
7/1/2006 6/30/2007 2006-2007 250,000 (none)
7/1/2007 6/30/2008 2007-2008 250,000 (none)
7/1/2008 6/30/2009 2008-2009 250,000 (none)
7/1/2009 6/30/2010 2009-2010 250,000 (none)
7/1/2010 6/30/2011 2010-2011 250,000 (none)
7/1/2011 6/30/2012 2011-2012 250,000 (none)
7/1/2012 6/30/2013 2012-2013 250,000 (none)
7/1/2013 6/30/2014 2013-2014 250,000 (none)
7/1/2014 6/30/2015 2014-2015 250,000 (none)
7/1/2015 6/30/2016 2015-2016 250,000 (none)
7/1/2016 6/30/2017 2016-2017 250,000 (none)
7/1/2017 6/30/2018 2017-2018 250,000 (none)
7/1/2018 6/30/2019 2018-2019 250,000 (none)
7/1/2019 6/30/2020 2019-2020 250,000 (none)
7/1/2020 6/30/2021 2020-2021 250,000 (none)
7/1/2021 6/30/2022 2021-2022 250,000 (none)
7/1/2022 6/30/2023 2022-2023 250,000 (none)
7/1/2023 6/30/2024 2023-2024 250,000 (none)
Third Party
Claims Begin End
Administrator Date Date
Current
This exhibit summarizes some of the key facts about the history of the program. 75 79
Appendix J

Page 1 ends

City of San Clemente - Liability
Incurred Losses as of 12/31/22
Incurred Incurred
Additions Subtractions Incurred Incurred $100,000 Incurred Capped at Accident Unlimited to from Adjusted Incurred Over Capped at to $250,000 Capped at $250,000 & Year Incurred Losses Losses Incurred Over $250,000 $100,000 $100,000 Layer $250,000 Aggregate (A) (B) (C) (D) (E) (F) (G) (H) (I) (J) (K)
2005-2006 38,028 0 0 38,028 0 0 38,028 0 38,028 38,028
2006-2007 2,695,012 0 9,243 2,685,769 1,947,573 2,315,189 370,580 367,616 738,196 738,196 2007-2008 1,579,956 0 2,000 1,577,956 1,240,871 1,390,871 187,085 150,000 337,085 337,085 2008-2009 1,751,679 0 33,090 1,718,589 356,868 956,868 761,721 600,000 1,361,721 1,361,721 2009-2010 3,222,282 0 0 3,222,282 2,377,552 2,703,181 519,101 325,629 844,729 844,729 2010-2011 17,116,245 0 294 17,115,951 16,543,472 16,843,472 272,478 300,000 572,478 572,478 2011-2012 435,808 0 8,439 427,370 0 91,983 335,387 91,983 427,370 427,370 2012-2013 2,111,804 0 0 2,111,804 1,538,813 1,838,813 272,990 300,000 572,990 572,990 2013-2014 498,870 0 27,500 471,370 144,212 294,212 177,158 150,000 327,158 327,158 2014-2015 2,950,737 0 132,279 2,818,458 1,391,424 2,083,895 734,563 692,470 1,427,034 1,427,034 2015-2016 651,125 0 0 651,125 230,703 384,194 266,931 153,492 420,423 420,423 2016-2017 940,978 0 0 940,978 500,712 669,908 271,070 169,196 440,266 440,266 2017-2018 158,998 0 0 158,998 0 0 158,998 0 158,998 158,998 2018-2019 741,661 0 0 741,661 193,053 493,053 248,608 300,000 548,608 548,608 2019-2020 904,833 0 275,000 629,833 0 208,958 420,875 208,958 629,833 629,833 2020-2021 3,428,186 0 14,695 3,413,492 1,992,182 2,721,115 692,377 728,933 1,421,309 1,421,309 2021-2022 817,677 0 0 817,677 50,000 350,000 467,677 300,000 767,677 767,677 2022-2023 54,491 0 0 54,491 0 0 54,491 0 54,491 54,491
Total $40,098,371 $0 $502,540 $39,595,831 $28,507,436 $33,345,712 $6,250,119 $4,838,276 $11,088,394 $11,088,394 Notes:
(A) Years are 7/1 to 6/30.
(B) Provided by the City.
(C)
(D) Subrogation recoveries.
(E) (B) + (C) - (D).
(F) Sum of incurred losses in excess of $250,000.
(G) Sum of incurred losses in excess of $100,000.
(H) (E) - (G).
(I) (G) - (F).
(J) (E) - (F).
(K) Minimum of (J) and the aggregate stop loss. See Appendix I. 76 80
Appendix J

Page 2 ends

City of San Clemente - Liability
Paid Losses as of 12/31/22
Paid Paid
Additions Subtractions Paid Paid $100,000 Paid Capped at Accident Unlimited to from Adjusted Paid Over Capped at to $250,000 Capped at $250,000 & Year Paid Losses Losses Paid Over $250,000 $100,000 $100,000 Layer $250,000 Aggregate (A) (B) (C) (D) (E) (F) (G) (H) (I) (J) (K)
2005-2006 38,028 0 0 38,028 0 0 38,028 0 38,028 38,028
2006-2007 2,695,012 0 9,243 2,685,769 1,947,573 2,315,189 370,580 367,616 738,196 738,196 2007-2008 1,579,956 0 2,000 1,577,956 1,240,871 1,390,871 187,085 150,000 337,085 337,085 2008-2009 1,751,679 0 33,090 1,718,589 356,868 956,868 761,721 600,000 1,361,721 1,361,721 2009-2010 3,222,282 0 0 3,222,282 2,377,552 2,703,181 519,101 325,629 844,729 844,729 2010-2011 13,660,949 0 294 13,660,655 13,088,177 13,388,177 272,478 300,000 572,478 572,478 2011-2012 435,808 0 8,439 427,370 0 91,983 335,387 91,983 427,370 427,370 2012-2013 2,111,804 0 0 2,111,804 1,538,813 1,838,813 272,990 300,000 572,990 572,990 2013-2014 498,870 0 27,500 471,370 144,212 294,212 177,158 150,000 327,158 327,158 2014-2015 2,950,737 0 132,279 2,818,458 1,391,424 2,083,895 734,563 692,470 1,427,034 1,427,034 2015-2016 651,125 0 0 651,125 230,703 384,194 266,931 153,492 420,423 420,423 2016-2017 900,613 0 0 900,613 460,347 629,543 271,070 169,196 440,266 440,266 2017-2018 158,998 0 0 158,998 0 0 158,998 0 158,998 158,998 2018-2019 741,661 0 0 741,661 193,053 493,053 248,608 300,000 548,608 548,608 2019-2020 811,799 0 275,000 536,799 0 170,546 366,253 170,546 536,799 536,799 2020-2021 1,189,269 0 14,695 1,174,574 342,093 737,329 437,245 395,236 832,481 832,481 2021-2022 267,704 0 0 267,704 0 103,728 163,976 103,728 267,704 267,704 2022-2023 891 0 0 891 0 0 891 0 891 891
Total $33,667,186 $0 $502,540 $33,164,646 $23,311,687 $27,581,583 $5,583,063 $4,269,896 $9,852,959 $9,852,959 Notes:
(A) Years are 7/1 to 6/30.
(B) Provided by the City.
(C)
(D) Subrogation recoveries.
(E) (B) + (C) - (D).
(F) Sum of paid losses in excess of $250,000.
(G) Sum of paid losses in excess of $100,000.
(H) (E) - (G).
(I) (G) - (F).
(J) (E) - (F).
(K) Minimum of (J) and the aggregate stop loss. See Appendix I. 77 81
Appendix J

Page 3 ends

City of San Clemente - Liability
Case Reserves as of 12/31/22
Reserves Reserves
Additions Subtractions Reserves Reserves $100,000 Reserves Capped at Accident Unlimited to from Adjusted Reserves Over Capped at to $250,000 Capped at $250,000 & Year Reserves Losses Losses Reserves Over $250,000 $100,000 $100,000 Layer $250,000 Aggregate (A) (B) (C) (D) (E) (F) (G) (H) (I) (J) (K)
2005-2006 0 0 0 0 0 0 0 0 0 0
2006-2007 0 0 0 0 0 0 0 0 0 0
2007-2008 0 0 0 0 0 0 0 0 0 0
2008-2009 0 0 0 0 0 0 0 0 0 0
2009-2010 0 0 0 0 0 0 0 0 0 0
2010-2011 3,455,296 0 0 3,455,296 3,455,296 3,455,296 0 0 0 0 2011-2012 0 0 0 0 0 0 0 0 0 0
2012-2013 0 0 0 0 0 0 0 0 0 0
2013-2014 0 0 0 0 0 0 0 0 0 0
2014-2015 0 0 0 0 0 0 0 0 0 0
2015-2016 0 0 0 0 0 0 0 0 0 0
2016-2017 40,365 0 0 40,365 40,365 40,365 0 0 0 0
2017-2018 0 0 0 0 0 0 0 0 0 0
2018-2019 0 0 0 0 0 0 0 0 0 0
2019-2020 93,034 0 0 93,034 0 38,412 54,622 38,412 93,034 93,034 2020-2021 2,238,917 0 0 2,238,917 1,650,089 1,983,785 255,132 333,696 588,828 588,828 2021-2022 549,973 0 0 549,973 50,000 246,272 303,702 196,272 499,973 499,973 2022-2023 53,600 0 0 53,600 0 0 53,600 0 53,600 53,600
Total $6,431,185 $0 $0 $6,431,185 $5,195,750 $5,764,129 $667,056 $568,380 $1,235,435 $1,235,435 Notes:
(A) Years are 7/1 to 6/30.
(B) Appendix J, Page 1, Column (B) - Appendix J, Page 2, Column (B). (C) Appendix J, Page 1, Column (C) - Appendix J, Page 2, Column (C). (D) Appendix J, Page 1, Column (D) - Appendix J, Page 2, Column (D). (E) (B) + (C) - (D).
(F) Sum of case reserves in excess of $250,000.
(G) Sum of case reserves in excess of $100,000.
(H) (E) - (G).
(I) (G) - (F).
(J) (E) - (F).
(K) Minimum of (J) and the aggregate stop loss. See Appendix I. 78 82
Appendix J

Page 4 ends

City of San Clemente - Liability
Claim Counts as of 12/31/22
Additions Subtractions Additions Subtractions
to from Adjusted to from Adjusted Adjusted
Accident Reported Reported Reported Reported Closed Closed Closed Closed Open Open Year Claims Claims Claims Claims Claims Claims Claims Claims Claims Claims (A) (B) (C) (D) (E) (F) (G) (H) (I) (J) (K)
2005-2006 37 0 0 37 37 0 0 37 0 0
2006-2007 29 0 0 29 29 0 0 29 0 0
2007-2008 50 0 0 50 50 0 0 50 0 0
2008-2009 41 0 0 41 41 0 0 41 0 0
2009-2010 33 0 0 33 33 0 0 33 0 0
2010-2011 49 0 0 49 48 0 0 48 1 1
2011-2012 31 0 0 31 31 0 0 31 0 0
2012-2013 40 0 0 40 40 0 0 40 0 0
2013-2014 45 0 0 45 45 0 0 45 0 0
2014-2015 33 0 0 33 33 0 0 33 0 0
2015-2016 35 0 0 35 35 0 0 35 0 0
2016-2017 35 0 0 35 34 0 0 34 1 1
2017-2018 37 0 0 37 37 0 0 37 0 0
2018-2019 50 0 0 50 50 0 0 50 0 0
2019-2020 34 0 0 34 32 0 0 32 2 2
2020-2021 33 0 0 33 27 0 0 27 6 6
2021-2022 38 0 0 38 32 0 0 32 6 6
2022-2023 8 0 0 8 3 0 0 3 5 5
Total 658 0 0 658 637 0 0 637 21 21
Notes:
(A) Years are 7/1 to 6/30.
(B) Provided by the City.
(C)
(D)
(E) (B) + (C) - (D).
(F) Provided by the City.
(G)
(H)
(I) (F) + (G) - (H).
(J) (B) - (F).
(K) (E) - (I).
79 83
Appendix K
City of San Clemente - Liability
Exposure Measures
Total Inflation Trended
Accident Payroll Trend Payroll
Year ($00) Factor ($00)
(A) (B) (C)
2001-2002 91,633 1.679 153,852
2002-2003 98,524 1.638 161,382
2003-2004 114,716 1.598 183,316
2004-2005 116,362 1.559 181,408
2005-2006 130,431 1.521 198,386
2006-2007 134,905 1.484 200,199
2007-2008 141,914 1.448 205,491
2008-2009 152,691 1.413 215,752
2009-2010 151,339 1.379 208,696
2010-2011 146,049 1.345 196,436
2011-2012 151,386 1.312 198,618
2012-2013 154,592 1.280 197,878
2013-2014 156,463 1.249 195,422
2014-2015 156,887 1.219 191,245
2015-2016 156,199 1.189 185,721
2016-2017 161,476 1.160 187,312
2017-2018 170,519 1.132 193,028
2018-2019 183,062 1.104 202,100
2019-2020 197,160 1.077 212,341
2020-2021 175,983 1.051 184,958
2021-2022 180,383 1.025 184,893
2022-2023 184,893 1.000 184,893
2023-2024 189,515 1.000 189,515
Notes:
(A) Provided by the City.
(B) Based on industry factors.
(C) (A) x (B).
80 84
910 Calle Negocio
2nd Floor
San Clemente, California
www.san-clemente.org

AGENDA REPORT

CITY OF SAN CLEMENTE

CITY COUNCIL MEETING

CITY OF SAN CLEMENTE
Meeting Date: February 6, 2024 Agenda Item: 9B
Subject:
..titl e
CONSIDERATION OF AFFIRMING PREVIOUS AMENDMENTS TO POLICY 1201-11 (CITY

COUNCIL MEETING AND OPERATING PROCEDURES) CONCERNING ALLOWING PUBLIC

COMMENTS ON THE CONSENT CALENDAR PRIOR TO CITY COUNCIL VOTING ON THE CONSENT CALENDAR ..body AND CONSIDERATION OF MOVING THE CONSENT CALENDAR Fiscal Impact:

None.

Summary:

At the January 16, 2024 City Council meeting, the City Council approved amendments to Policy 1201-11 (City Council Meeting and Operating Procedures). This agenda item will clarify and ratify the decisions of the City Council as well as making some technical corrections. Affirming Resolution 24-13 would affirm the votes taken at the January 16, 2024 City Council meeting with respect to the Policy.

While Policy 1201-11 is before the City Council, the City Council may wish to consider directing staff to make other changes to the Policy to improve City Council meeting efficiency. For example, the City Council routinely moves items before the Consent Calendar to address public hearings or regular business items to allow residents to return to their homes at a more reasonable hour. The City Council may wish to direct staff to change the format of the agenda so that the Consent Calendar, intended to be routine and uncontested items, being heard near the end of the meeting instead of the beginning.

Background:

At its meeting of January 16, 2024, the City Council had two items on its agenda that would amend Policy 1201-11. In consideration of Item 7K, the City Council voted unanimously to reject Resolution No. 24-07 and not modify Section 4.2.1 of Policy 1201-11 with respect to amending the Mayor and Mayor Pro Tempore terms. This vote was opposite of what the City Council had decided to enact on December 5, 2023. The net result was that Section 4.2.1 of Policy 1201-11 remains the same as it was before December 5, 2023: the Mayor and Mayor Pro Tempore terms are effective immediately after they are voted on. Because of the different direction given, staff recommends ratification of that decision through this agenda item.

A second item on the January 16, 2024 agenda was consideration (and then reconsideration) of item 10C, the City Council voted 3-2 (Councilmember Loeffler and Councilmember Knoblock voting no) to adopt Resolution No. 24-13 amending Policy 1201-11:

1. To exercise its sole authority to set its own agenda; and 1 Meeting Date: February 6, 2024 Agenda Item: 9B

CITY OF SAN CLEMENTE

2. To allow the public one opportunity to comment (for up to three minutes) on the entirety of the Consent Calendar prior to the City Council voting on the Consent Calendar.

Under this adopted Policy, if a member of the City Council or staff pulls a matter from the Consent Calendar to have it separately agendized, the public would have the opportunity to speak for up to three minutes on each of the items that were pulled. The public could also request (during their comment period) to have a member of the City Council pull matters from the Consent Calendar and separately agendize them for further discussion; but the public would not have the ability to exercise control over the agenda by pulling items.

This item is being brought to the City Council as a clean-up item because the previous administrative report and Resolution 24-13 on item 10C on January 16, 2023 included the change to Section 4.2.1 of the Policy that the City Council decided not to adopt on item 7K with respect to the effective time of the Mayor and Mayor Pro Tempore terms. Attachment 1 to this report is Resolution 24-13 and the corrected Policy for the City Council to consider to affirm the Policy changes with respect to public comments on the Consent Calendar (and to affirm that no changes were made to Section 4.2.1 of Policy on term effectiveness).

Public Comment on the Consent Calendar:

Pursuant to Section 4.5.1 of Policy 1201-11, with the exception of items added to a City Council agenda pursuant to Section 4.5.4 of the Policy (i.e., by at least two Councilmembers at a prior meeting), the City Manager and Mayor in conference shall be responsible for determining items to appear on City Council meeting agendas. Courts have recognized that a public agency must have “authority to set its agenda or it would be unable to conduct its business.” Leventhal v. Vista Unified Sch. Dist., 973 F.Supp. 951, 962 (S.D. Cal. 1997).

The Consent Calendar is one item on the City Council agenda. Government Code section 54954.3(a) (which is part of the Ralph M. Brown Act) requires the City to allow members of the public to address it before or during consideration of an agenda item. “The subdivision does not, however, require the [City] to allow members of the public to address it on whether to place an item on the agenda. There is simply nothing in the Brown Act that requires such public comment.” Coal. of Lab., Agric. & Bus. v. Cnty. of Santa Barbara Bd. of Supervisors (2005) 129 Cal.App.4th 205, 209.

Allowing members of the public to pull matters off the Consent Calendar and place them as separate items on the agenda is inconsistent with Section 4.5.1 of Policy 1201-11, which only allows two Councilmembers or the City Manager and Mayor in conference to determine the items to appear on City Council meeting agendas. Furthermore, a public agency can deny requests from the public to place an item on the agenda. See Leventhal, 973 F.Supp. at 961-62 (noting that “even if the Plaintiffs were unable to place a given issue on the [Public Agency’s] agenda, they could still raise their concerns during the public comment period”).

On January 16, 2023, a majority of the City Council clarified Policy 1201-11 with respect to public comments related to the Consent Calendar and adopted Resolution 24-13. Section 4.4.4 of the Policy allows members of the public to speak one time for a total of three (3) minutes on all Consent Calendar matters as one item prior to the City Council voting on the Consent Calendar as required by the Brown Act. Section 4.5.8 of the Policy makes that section consistent with 2 Meeting Date: February 6, 2024 Agenda Item: 9B

CITY OF SAN CLEMENTE
Section 4.5.1 by specifying that only members of the City Council or staff can pull matters off the Consent Calendar and set them as separate items for discussion. Speakers are still be allowed to request that matters be pulled as part of their three (3) minutes of public comment under the Policy as adopted on January 16, 2023, which staff is recommending be affirmed in the form included as Attachment 1.

When the Consent Calendar is Heard:

In recent times, large audiences have appeared at City Council meetings to comment on nonconsent items. This has resulted in the City Council routinely moving items on the agenda up before the Consent Calendar. If the City Council wants to continue this practice, it may want to consider directing staff to change Policy 1201-11 administratively so that the Consent Calendar, intended to be routine and uncontested items, is heard at the end of the meeting, instead of at the beginning. Or the City Council may want to continue the current practice and not make any other changes to Policy 1201-11.

Council Options:
 Affirm and Re-Adopt Resolution No. 24-13 (Attachment 1), which would affirm modifications to Sections 4.4.4 and 4.5.1 of City Council Meeting and Operating Procedures Policy 1201-11 and affirm that no changes were made to Section 4.2.1.
 Modify and adopt Resolution No. 24-13.
 Direct Staff to return with additional information.
 Direct Staff to change Policy 1201-11 regarding when the Consent Calendar is heard or to make other changes.
 Take no action.

Environmental Review/Analysis
This is not a “project” under the California Environmental Quality Act.

Recommended Actions:

Staff Recommendation ..recommendation

1. Adopt Resolution No. 24-13, which would affirm modifications to Sections 4.4.4 and 4.5.1 of City Council Meeting and Operating Procedures Policy 1201-11 to clarify that the public shall be allowed a total of three (3) minutes to comment on the Consent Calendar as one agenda item prior to the City Council voting on the Consent Calendar as a whole and that if a member of the City Council or staff pulls a matter off the Consent Calendar, the matter would be treated as a separate agenda item with additional public comment.

And

2. Authorize and direct staff to administratively change Policy 1201-11 so that the Consent Calendar is heard at the end of the meeting, instead of the beginning, and to publish the updated Policy on the City’s website without the need for staff to return to City Council with a formal resolution.
3 Meeting Date: February 6, 2024 Agenda Item: 9B

CITY OF SAN CLEMENTE
..endAttachment:

1. Resolution No. 24-13
Notification:

None.
4 RESOLUTION NO. 24-13

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN

CLEMENTE, CALIFORNIA, AMENDING POLICY AND PROCEDURE
1201-11 (CITY COUNCIL MEETING AND OPERATING PROCEDURES)

RELATED TO PUBLIC COMMENT ON CONSENT CALENDAR
WHEREAS, the City Council follows Policy and Procedure 1201-11 of the City Council Meeting and Operating Procedures (Parliamentary Procedures, Due Process, Mayor/Mayor Pro Tempore, Council Correspondence, Meetings, Agendas, and Minutes); and
WHEREAS, the Ralph M. Brown Act (Government Code section 54954.3(a)), requires the City to allow members of the public to address it before or during consideration of an agenda item; and
WHEREAS, the Consent Calendar is one single item on the City Council’s agenda; and
WHEREAS, the City Council desires to amend Policy and Procedure 1201-11 to clarify public comment on the Consent Calendar consistent with the Ralph M. Brown Act and case law;
NOW, THEREFORE, the City Council of the City of San Clemente does hereby find, determine and resolve as follows:

Section 1. That the above recitals and true and correct and incorporated herein as findings.

Section 2. That Policy and Procedure 1201-11 of the City Council Meeting and Operating Procedures (Parliamentary Procedures, Due Process, Mayor/Mayor Pro Tempore, Council Correspondence, Meetings, Agendas, and Minutes) is hereby amended as indicated in Exhibit 1 to this resolution, which is hereby incorporated fully by this reference (underlines indicate additions and strikeouts indicate deletions).

Section 3. That this resolution updates and replaces Resolution No. 24-07.

Section 4. The City Clerk shall certify to the passage and adoption of this resolution and enter it into the book of original resolutions.

PASSED AND ADOPTED this ____ day of January 16, 2024.

ATTEST:
___________________________ __________________________
City Clerk of the City of Mayor of the City of San
ATTACHMENT 1
5 Resolution No. Page 2
San Clemente, California Clemente, California

STATE OF CALIFORNIA )
COUNTY OF ORANGE ) §

CITY OF SAN CLEMENTE )
I, LAURA CAMPAGNOLO, City Clerk of the City of San Clemente, California, do hereby certify that Resolution No. 24-13 was adopted at a regular meeting of the City Council of the City of San Clemente held on the _______ day of January 2024, by the following vote:

AYES:

NOES:

ABSENT:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Clemente, California, this _____ day of ________________, ________.

CITY CLERK of the City of
San Clemente, California
Approved as to form:
_________________________
Elizabeth A. Mitchell, City Attorney
6

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EXHIBIT 1

POLICY AND PROCEDURE
Subject: City Council Meeting
and Operating
Procedures
(Parliamentary Procedures,
Due Process, Mayor/Mayor
Pro Tempore, Council
Correspondence, Meetings,
Agendas, and Minutes)
Index: City Council
Number: 1201-11
Effective
Date:

February 7, 2023
January 16, 2024
Prepared City Clerk
By:

Supersedes: Policy and Procedures 1201-
1 (Mayor and Mayor Pro
Tempore); 1201-2 (Meetings
of the City Council); 1201-3
(Order of Business and
Preparation of Minutes);
1201-4 (Council
Approved
By:

City Council
Correspondence and
Agenda); 1201-5 (Rules of
Debate, Decorum, Voting
Requirements & Procedures);
1202-2 Management/
Streamlining of City Council
Meetings); and 1201-11 (City
Council Meeting and
Operating Procedures)

1.0 PURPOSE:

To establish policies for City Council meetings and operations, including parliamentary procedures, due process, election/roles of Mayor and Mayor Pro Tern, agendas, and the preparation of minutes.

2.0 ORGANIZAT/ONS AFFECTED:

City Council
City Commissions and Committees*
*Note: Except as otherwise noted throughout this Policy, this Policy shall a/so apply to the City's Commissions and Committees. In applying this Policy to City Commissions and Committees, the term "Council" shall be interpreted to mean the name of the City Commission or Committee, the term "Mayor" shall be interpreted to mean "Chairperson", the term "Mayor Pro Tempore shall be interpreted to mean "Vice Chair': the term "Manager" shall be interpreted to mean "Director", and the 7

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term "City Clerk" shall be interpreted to mean the staff member responsible for providing support to the Commission/Committee.

3.0 REFERENCES:

The Ralph M. Brown Act, GC Section 54950, et seq.

4.0 POLICY:

4.1 Parliamentary Procedures and Due Process

4.1.1 The proceedings of the City Council shall be guided under the latest revised edition of "Rosenberg's Rules of Order," on all matters pertaining to parliamentary procedure, but no ordinance, resolution, proceeding or other action of the City Council shall be invalidated or the legality thereof otherwise affected by the failure or omission to observe or follow such rules. In the event of a discrepancy between Rosenberg's Rules of Order and this Policy and Procedure, this Policy and Procedure shall prevail.

4.1.2 The Mayor, with assistance from the City Attorney, is designated as the parliamentarian for City Council meetings. The City Clerk shall assist in the City Attorney's absence. Any member of the City Council or the public (pursuant to process below) may raise a point of order and/or seek the City Attorney's input on parliamentary issues, which shall then be considered by the Mayor. The City Council may override any parliamentary decision of the Mayor with a majority vote. The Mayor may interpret and apply but not amend these policies.

Points of order may be raised at any time by City Councilmembers.

Points of order may be raised by members of the public in connection with their opportunity to speak on agenda items pursuant to Section

4.4.6. The Mayor (or chair) shall rule on the point of order and/or request clarification of the law from the City Attorney and then decide and rule. If the point of order is denied by the Mayor or chair, the person making the point of order may seek a vote of the entire Council or body, which decision shall be final.

Members of the public wishing to raise points of order after their opportunity to speak may submit those points of order in writing prior to the adjournment of the meeting. Items so submitted shall be presented for consideration by the City Council in connection with its approval of the minutes of that meeting pursuant to Section

4.6 hereof. At that time the Mayor and City Council will review and decide the point of order raised and determine whether it warrants scheduling and noticing of that item for reconsideration. 8

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4.1.3 It shall be understood that a member of the City Council or prospective member of the City Council may, in the course of seeking elective office, be asked to state positions on general issues that may eventually come before the Council at a later date. This policy shall in no way impair that Councilmember's right to consider the issue and vote as he/she determines is appropriate.

4.1.4 Ex parte communications are communications received outside of Council meetings or hearings. When the Council acts in a legislative role (for example, to adopt general plan or zoning amendments or to adopt ordinances), Councilmembers are permitted to draw upon nearly all observations and considerations they receive inside and outside the Council meeting. On the other hand, when acting in a quasi-adjudicatory role (hearing permits, revocations, and similar non-legislative decisions), the Council, as fact-finder, should limit its consideration of facts to those presented at the hearing, where all sides have the opportunity to hear and rebut testimony given by all participants. To this end, Councilmembers should avoid receiving or gathering information that might otherwise influence its consideration of the written record and any other testimony it hears through the formal hearing process, or at least disclose their receipt of that information.

4.2 Election of Mayor and Mayor Pro Tempore and Roles of Those Offices

4.2.1 At the first Regular City Council meeting in December of each year, the Council shall elect from its members a Mayor and Mayor Pro Tempore. The new Mayor and Mayor Pro Tempore shall assume office immediately. (Note: Commissions and Committees shall elect from its members a Chairperson and Vice Chair at its first regular meeting occurring after Council completes its annual appointment process for Commission and Committee members and those members assume office.) The process for electing Mayor and Mayor Pro Tempore and for electing Commission and Committee Chairs and Vice-Chairs shall be as follows:

4.2.1.1 The nomination/election of the Mayor or Chair is conducted by the City Clerk or staff. Once the new Mayor or Chair is elected, that member of the Council or body immediately presides and conducts the vote on Mayor Pro Tempore or Vice-Chair.

4.2.1.2 The method of nomination in this respect is an "open nomination" solely by and from within the membership of the presently-seated City Council or City body. Nomination cannot be accepted from members of the public.

4.2.1.3 No "second" is required for nomination, although sometimes one or more members will "second" a nomination to indicate endorsement. 9

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4.2.1.4 In no event may any one member nominate more persons than there are offices to fill in the respective selection.

4.2.1.5 When it appears that no one else wishes to make a nomination, the chair of the meeting asks one (1) final time if there are additional nominations. If there is a no response, the chair then declares..."the nomination for Mayor or Mayor Pro Tempore, Chair or Vice-Chair as applicable is closed."

4.2.1.6 It is unnecessary to have a motion to officially close the nomination; yet, if such a motion is made, that motion then requires an affirmative 213rd vote of the members present [4 or 5]. After nominations are closed, a majority vote is required to re-open it.

4.2.1.7 Nominees are voted on in the order in which they are nominated.

As soon as one of the nominees receives a majority vote of those members present in the voting, the Mayor or Chair then declares that person elected to that respective office, and no vote is taken on the remaining nominee(s).

4.2.1.8 Rounds of voting shall continue in succession until one nominee is elected.

4.2.2 The Mayor and Mayor Pro Tempore shall serve a one-year term at the pleasure of the Council majority.

4.2.3 The Mayor shall act as the primary spokesperson and official representative of the City Council, unless such responsibility is delegated by the Mayor, or otherwise assigned by a majority of the City Council.

4.2.4 The Mayor shall preside at all regular, adjourned regular, special and emergency meetings of the City Council, including joint meetings with commissions and committees and closed sessions.

4.2.5 The Mayor shall execute all official City documents, warrants and correspondence approved by the City Council.

4.2.6 The Mayor is authorized to issue proclamations, commendations and certificates of recognition, which may be presented at Council meetings under Special Presentations. The total time allotted to Special Presentations should, if possible, be limited to 15 minutes per meeting. (This section does not apply to Commissions or Committees.)
10

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4.2.7 Nothing in this section is intended to suggest that the office of Mayor possesses formal powers or authority in excess of other members of the City Council; rather, the person serving as Mayor is to be recognized as the chairperson of the Council.

4.2.8 The Mayor Pro Tempore shall serve and perform the functions of the Mayor in the absence of the Mayor. If both the Mayor and Mayor Pro Tempore are absent from a City Council meeting, the Council members present shall select a Councilmember from those members present to perform the functions of Mayor at that particular meeting.

4.3 City Council Correspondence

4.3.1 The City Manager, or his/her designee, is authorized to open and examine all mail or other written communications addressed to the City Council as a body, but shall not open correspondence addressed to an individual Councilmember without their express authorization.

4.3.2 The City Manager may take action, or direct that action be taken, on issues or requests that do not require Council action. The City Manager shall inform Council when actions are taken on matters of significance or that are likely to be of interest to the City Council.

4.4 City Council Meetings

4.4.1 The date, time and location of Regular Meetings of the City Council shall be established by resolution. At 11:00 p.m. at each meeting, the City Council, by majority vote, will determine whether to continue the meeting or adjourn.

4.4.2 At all meetings of the City Council, a majority of the Council members shall constitute a quorum for the transaction of business. In the event less than a quorum of the City Council is present, the City Clerk shall adjourn the meeting (which may include adjourning to an Adjourned Regular Meeting), post a Notice of Adjournment, and prepare minutes that reflect that the meeting was adjourned due to lack of a quorum.

4.4.3 The City Clerk, or Mayor, shall announce an agenda item before discussion on that item commences.

4.4.4 Each person desiring to address the Council is requested to submit to the City Clerk a speaker form. After being called upon by the Mayor, the speaker may proceed to the podium. The speaker may 11

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state for the record his/her name and city of residence, but shall not be required to do so.

Members of the public may speak for three (3) minutes and project applicants and appellants (including members of an applicant's or appellant's project presentation team, when applicable) may speak for a combined total of ten (10) minutes on agenda items. At Council's request where Council is acting in a fact-finding or hearing capacity, the Mayor may grant additional time (unless overruled by a majority of Councilmembers present) to speakers on agenda items.

Speakers will be called to the podium once Staff concludes its presentation of an item and before Council begins its deliberations.

Speaker cards will not be accepted once deliberations have commenced.

Speakers on non-agenda items may speak for three (3) minutes during the oral communications - public forum portion of the meeting.

At the beginning of the Consent Calendar, the City Clerk will notify the Mayor or meeting Chair of any public comments related to the Consent Calendar. Speakers will be allotted 3 minutes to speak on the Consent Calendar in its entirety. After public comments, if any, are heard, the City Council will vote on the Consent Calendar as one agenda item.

The time that a speaker devotes to responding to Council inquiries shall not be deducted from their allotted speaker time.

4.4.5 Members of the public may not assign their speaker time to another person.

4.4.6 The purpose of addressing the City Council is to communicate formally with the City Council regarding matters that relate to City Council business or citizen concerns within the subject matter jurisdiction of the City Council. Persons addressing the City Council on an agenda item shall confine their remarks to the matter under consideration by the City Council. Speakers may be asked to clarify how their comments relate to the matter at hand. Speakers may address the entire Council or individual Councilmembers, and, if allowed by the Mayor or chair, City staff.

4.4.7 Once recognized, members of the public shall not be interrupted when speaking unless to be called to order by the Mayor to: (i) curtail extraordinary repetition, (ii) curtail speech that is irrelevant to the City Council's subject matter jurisdiction, (iii) explain how his or her speech relates to the City's subject matter jurisdiction, or (iv) address some other point of order. If a speaker is interrupted to be called to order, the speaker shall cease speaking until the question of order is determined, and if in order, he or she shall be permitted to proceed, 12

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with additional time allotted for the time taken to determine the question of order.

4.4.8 In order to avoid repetitious presentations, whenever any group of persons wishes to address the Council with the same message, it shall be proper for the Mayor to request that a spokesperson be chosen by the group to represent the group's position. Speakers shall not, however, be required to abide by such a request.

4.4.9 To expedite Council meetings, Councilmembers are encouraged to contact Staff prior to Council meetings to obtain answers to questions and to obtain clarifications as needed.

4.4.10Staff shall compose Administrative Reports in a clear and concise manner. Staff shall strive to write reports in a manner that can be easily understood by persons that do not have training in the report's subject matter.

4.4.11Staff presentations at Council meetings are to be condensed to the briefest extent possible, while still providing a basic overview of the issue under consideration. Staff is encouraged to refrain from reiterating issues previously addressed in the Administrative Report.

However, Staff engaged in such communications shall not use these opportunities to communicate with the members of the City Council the comments or position of any other member of the City Council on City Council business.

4.4.12 Members of the public shall not engage in conduct that disrupts, disturbs, or otherwise impedes the orderly conduct of the City Council meeting. Any person who so disrupts the meeting is subject to removal from the meeting.

Prior to removing anyone from a City meeting, the Mayor (or other designated chair) shall: (i) notify the person that he/she is in violation of this Section 4.4.12, (ii) specify the specific behavior giving rise to that conclusion; (iii) explain all grounds for the belief that the person's conduct is in violation of law/policy and why such conduct subjects the person to expulsion; and (iv) notify the person that if the conduct continues he/she will be removed. The person receiving such notification shall be asked if he/she understands the conclusion but shall not be required to accept it.

Members of the public receiving notice of disruption pursuant to this section shall have the right, prior to being removed from the meeting, to ask the Mayor to consult with the City Attorney on the grounds for expulsion, and to submit a point of order on the grounds for expulsion. The City Council may override this decision pursuant to Section 4.1.2. The City Attorney shall have a duty to inform the Mayor (or other designated chair) and the public if the City Attorney believes that the Mayor's action is in violation of applicable law. 13

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4.4.13 Motions must be seconded in order to proceed to a vote.

4.5 City Council Agendas

4.5.1 With the exception of items added to a City Council agenda pursuant to Section 4.5.4 of this Policy, the City Manager and Mayor in conference shall be responsible for determining items to appear on City Council meeting agendas.

4.5.2 The standard template for City Council agendas shall be established by Council by majority vote. The City Manager shall have the authority to reorganize the template on a case-by-case basis if he/she believes that a variation in the normal order of business is appropriate.

4.5.3 Councilmembers may agendize items to enable them to "report out" on matters relating to their own activities, including activities pertinent to their Council-appointed positions on regional commissions, committees and boards, provided the report is informational only. If Council action is being sought, the process defined in Section 4.5.4 of this Policy shall be followed.

4.5.4 Two members of the City Council may propose at a Council meeting that an item be agendized for future Council discussion, consideration, and/or action. Subject to notice and hearing requirements, the item shall be agendized for a future meeting and noticed as required by law. Items agendized pursuant to this section shall appear on an agenda under the New Business portion of the agenda and the names of the Councilmembers who agendized the item shall be included with the item description. Staff Reports will only be prepared if a minimum of three members of the City Council vote affirmatively at a Council meeting to direct Staff to prepare a report.

4.5.5 Notwithstanding Sections 4.5.1 and 4.5.4 of this Policy, the process to review, appeal, or otherwise "call up" decisions by the Planning Commission or other subordinate City bodies shall be subject to the requirements of the San Clemente Municipal Code.

4.5.6 Notwithstanding Section 4.5.4, a proposal to reconsider any action taken by the City Council may be raised only at the same meeting or the next regularly scheduled meeting of the City Council after the action is taken and may be raised only by one of the
Councilmembers who voted with the prevailing side. Additionally, the motion to reconsider may only be made by one of the
Councilmembers who voted with the prevailing side.

4.5.7 The City Clerk shall be responsible for the preparation of Council meeting agendas and shall cause copies to be posted on the City Hall bulletin board(s) and City website. Regular and Adjourned Regular Meeting agendas shall be posted within the posting time 14

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requirements as set forth in State law. In the case of special meetings, agendas shall be posted as soon as practical, but in no event less than the posting time requirements as set forth in State law.

4.5.8 Consent Calendar items shall be comprised of items that are expected to be noncontroversial. Unless an item is removed from the Consent Calendar by a member of the Council or staff, or the public for separate discussion and action, the Consent Calendar may be acted upon by one motion as one item.

4.5.9 The City Council may waive the reading in full of all Resolutions and Ordinances. The reading of Resolution titles shall be optional. The reading of Ordinance titles shall not be waived.

4.5.10 Members of the public may address Council concerning matters within the jurisdiction of the City of San Clemente, but not separately listed on the agenda, during the Oral Communications portion of the agenda. Speakers may address Council once during either Oral Communications Part 1 or Part 2. Speakers shall be allotted 3 minutes in which to give his or her presentation.

4.6 City Council Minutes

4.6.1 The City Clerk shall have exclusive responsibility for the preparation of the minutes.

4.6.2 The minutes of City Council meetings shall be submitted to Council for approval/modification at a City Council meeting. Any direction for modifications to the City Council minutes shall only be made upon a majority vote of the City Council.

4.6.3 Minutes shall be prepared in brief concise form, in what are commonly referred to as "action minutes". Action minutes memorialize what was done at a meeting, as opposed to what was said at a meeting. An exception to this guideline is that a brief summarization of comments provided to Council by the public are to be included in the minutes. Additionally, the identity of Councilmembers who make motions, second motions, and cast votes on motions are to be included in the minutes.

4.6.4 Unless the reading of the minutes of a City Council meeting is ordered by a majority of the Council, such minutes may be 15

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approved without reading if the City Clerk has previously furnished each Councilmember with a copy thereof.

4.6.5 The approved minutes shall be executed by the Mayor and City Clerk upon approval by the City Council and shall constitute the official record of the City Council meeting.

4.6.6 The City Clerk shall enter the original executed minutes into the official records of the City as a permanent document.

4.7 Closed Sessions

4.7.1 The City Council may hold closed sessions during duly-noticed Council meetings on issues authorized by State law.

4.7.2 A City Commission or Committee may hold closed sessions during duly-noticed meetings of its body on issues authorized by State law, the City Council, and the City Attorney.

4.7.3 No member of the City Council, employee of the City, or any person present during a closed session shall disclose to any other person the content or substance of discussion or action which took place during the session, unless a majority vote of the Council authorizes such disclosure.

4.7.4 Closed sessions shall be limited to members of the City Council, City Manager, City Attorney and/or City legal counsel, as well as staff members and experts designated by the City Manager or City Attorney to attend portions of Closed Sessions relating to specific issues, as permitted by law.

4.7.5 To the extent possible, the public will be notified prior to the time that the City Council recesses to closed session as to whether or not a public announcement of action is anticipated following the Closed Session.

4.7.6 Where potential plaintiffs and defendants have manifested or communicated their awareness of facts and circumstances and a legal theory connecting those facts and circumstances to potential litigation involving the City, those facts and circumstances, together with (i) the identity of potential parties or (ii) related documentation, shall be disclosed prior to a closed session to discuss anticipated litigation, in accordance with GC 54956.9.

4.8 Nomination and Vote on City Council Appointments to City Commissions and Committees
16

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4.8.1 Council votes on appointments to City Commission and Committees shall be according to the procedure for election of Mayor and Mayor Pro Tempore set forth in Section 4.2 above.
17 910 Calle Negocio
2nd Floor
San Clemente, California
www.san-clemente.org

AGENDA REPORT

CITY OF SAN CLEMENTE

CITY COUNCIL MEETING

CITY OF SAN CLEMENTE
Meeting Date: February 6, 2024 Agenda Item: 10A
Submitted By: Public Works
Subject:
..titl e

CONSIDERATION OF A RESOLUTION AWARDING A CONSTRUCTION CONTRACT TO

HARBOR COATING AND RESTORATION FOR THE MONTALVO AND RIVIERA PEDESTRIAN BRIDGES COATING REPLACEMENT, CIP PROJECT NO. 23802, AND AUTHORIZING THE CITY ..body MANAGER TO EXECUTE THE CONSTRUCTION CONTRACT Fiscal Impact:

The estimated construction cost of $751,890 is within the available approved project budget of $752,476, from the General Fund, Montalvo and Riviera Beach Trail Bridges, Account No. 001- 636-45700-000-23802.

Summary:

The City Council is being asked to consider the approval of a construction contract with Harbor Coating & Restoration for the Coating Replacement, in an amount of $539,890, and approval of a 15% project contingency of $81,000, for the needed coating replacement and the corroded steel repairs for Montalvo and Riviera Pedestrian Bridges (Attachment 1).

Background:

The Montalvo and Riviera Pedestrian Bridges were fabricated in September 2006.

Due to exposure to the highly corrosive marine environment, the existing coating on these bridges has reached the end of its service life and will continue to corrode without any corrective action. Michael Baker International, Inc. (MBI), structural engineering consultant, was retained to conduct a bridge inspection on December 3, 2021. They provided recommendations for treatment and coating of both pedestrian bridges to extend the service life of each of the bridges for several decades. The City conducted formal competitive bidding for the Montalvo and Riviera Pedestrian Bridges Coating Replacement, CIP Project No. 24802 (Project) and received six bids on July 27, 2023. Subsequent to the bid opening on July 27, 2023, additional corroded steel surfaces below the bridge and some additional plank replacements were identified. Therefore, City staff recommended rejecting all bids, expanding the scope of work, and re-biding the project. On October 3, 2023, City Council approved rejecting the bids received on July 27, 2023.

Upon rejection of the bids, MBI further re-assessed the bridges and provided additional areas that need repairs. Based on MBI’s repair recommendations, staff prepared a bid package, notified local contractors, and advertised the project for competitive bidding on the PlanetBids website and in the SC Times. Four bids were received on January 4, 2024, ranging from $458,390 to $875,498. The results are presented on the attached Bidders’ Listing (Attachment 3). The lowest responsive and responsible bidder was Harbor Coating & Restoration of Orange, California, at 1 Meeting Date: February 6, 2024 Agenda Item: 10A

CITY OF SAN CLEMENTE
$458,390. While local contractors were notified of the bid advertising, no local contractors submitted a bid.

Generally, the construction management and inspection costs are approximately under 10% of the construction cost. However, since welding and coating Inspection (NACE), and full-time monitoring for 60 working days may be required to ensure coating and preparation of the material is completed properly, the construction management and inspection cost exceeds the typical 10% and will be 25%. The contract for these services will be competed separately and will be recommended to the City Council at a future meeting prior to the start of construction.

Based on the lowest base bid and alternate bid items (i.e. additional corroded steel replacement in the amount of $81,500), the estimated construction cost for this project is as follows:

Construction Administration, Management &
Welding and Coating Inspection $131,000
Construction Contract 539.890
Contingency (15%) 81,000
Total Estimated Construction Cost $751,890
As required by state law and City policy, the Contractor will be required to provide performance and payment bonds simultaneously with execution of the construction contract (Attachment 4).

Project plans and specifications are on file in the City Clerk’s office.

Council Options:
 Adopt Resolution No. 24-19 (Attachment 2), awarding the contract for the Montalvo and Riviera Pedestrian Bridges Coating Replacement to Harbor Coating & Restoration, and authorizing the City Manager to execute a construction contract in the amount of $539,890, plus a 15% project contingency of $81,000.
 Modify and adopt Resolution No. 24-19.
 Continue the item and direct staff to provide additional information.  Do not adopt Resolution No. 24-19 and put the project on hold.

Environmental Review/Analysis
This Project was previously determined to be exempt from the California Environmental Quality Act (CEQA) under Class 1 (Existing Facilities, 14 CCR 15301), Section 15301 of the state CEQA Guidelines. A Notice of Exemption was filed with the County of Orange Recorder’s Office on November 08, 2022 for this Project. (See Attachment 5.) With the expanded scope of work, the Project is still exempt under Class 1.
2 Meeting Date: February 6, 2024 Agenda Item: 10A

CITY OF SAN CLEMENTE
Recommended Actions:

Staff Recommendation ..recommendation
..recommendation
Staff recommends that the City Council adopt Resolution No. 24-19, which will:

1. Award the Montalvo and Riviera Pedestrian Bridges Coating Replacement, CIP Project No. 23802, construction contract to Harbor Coating & Restoration, as the lowest responsible and responsive bidder;

2. Authorize the City Manager to execute a construction contract with Harbor Coating & Restoration in an amount of $539,890, and approve a 15% project contingency of $81,000, in a form substantially similar to Contract No. C24-07 (Attachment 4); and

3. Approve a 15% project contingency of $81,000.
..end
Attachment:

1. Location Map

2. Resolution No. 24-19

3. Bidders’ Listing

4. Contract No. C24-07

5. Notice of Exemption
Notification:

All Bidders.
3 CLE LASUEN AVE ALESSANDRO

CLE DE LOS ALAMOS AVE LA COSTA

AVE LOBEIRO

AVE MONTALVO

PLAZA A LA PLAYA CLE CAPRI

AVE DE LA RIVIERA
A. T. & S. F. R. R.

AVE SAN ANTO

CLE ROCA VIS

CLE MONTE CRISTO CLE MONACO

CLE LAS PALMAS

CLE MONTE CARLO CLE MADIERA

CLE MAJORCA

PACIFIC OCEAN

SAN CLEMENTE

STATE BEACH

AT&SF RR
Montalvo and Riviera Pedestrian
Coating Replacement Project

NOT TO SCALE
PN 23802

PROJECT

LOCATIONS
ATTACHMENT 1
4 910 Calle Negocio, Suite 100
San Clemente, CA 92673
Tel (949) 361-6100
Fax (949) 361-8316
ATTACHMENT 2
4882-9904-3949 v1
RESOLUTION NO. 24-19

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SAN CLEMENTE, CALIFORNIA, AWARDING A

CONSTRUCTION CONTRACT TO HARBOR COATING &

RESTORATION FOR THE MONTALVO AND RIVIERA

PEDESTRIAN BRIDGES COATING REPLACEMENT
PROJECT, CIP PROJECT NO. 23802, AND AUTHORIZING

THE CITY MANAGER TO EXECUTE THE CONTRACT
WHEREAS, on December 3, 2021, Michael Baker International (MBI), Inc., structural engineering consultant, conducted a bridge inspection for both Montalvo and Riviera pedestrian bridges; and
WHEREAS, the existing coating on these bridges has reached the end of its service life and will continue to corrode without any corrective action and the proposed treatment and coating will extend the service life of the bridges for several decades; and WHEREAS, based on the MBI’s recommendations as to the scope of work needed, the City conducted formal competitive bidding for the Montalvo and Riviera Pedestrian Bridges Coating Replacement Project, CIP Project No. 23802 (Project) and received six bids in July 27, 2023; and
WHEREAS, subsequent to the bid opening on July 27, 2023, further repairs were identified that should be included in the bid package, such as additional corroded steel surfaces below the bridge and some additional plank replacements. Therefore, City staff recommended rejecting all bids, expanding the scope of work, and re-biding the project; and
WHEREAS, on October 3, 2023, the City Council approved rejecting all bids received on July 27, 2023; and
WHEREAS, the City conducted formal competitive bidding for the Montalvo and Riviera Pedestrian Bridges Coating Replacement, Project No. 23802 (Project), with the expanded scope of work; and
WHEREAS, on January 4, 2024, the City received four (4) bids ranging from $458,390 to $875,498 for the Project; and
WHEREAS, the lowest responsive and responsible bidder was Harbor Coating & Restoration of Orange, California, in the amount of $539,890, based on the low base bid and the alternate bid item; and
WHEREAS, this project was previously determined to be categorically exempt from the California Environmental Quality Act (CEQA) under Section 15301 of the state CEQA Guidelines, Class 1 (Existing Facilities, 14 CCR 15301) and a Notice of Exemption was filed with the County of Orange Recorder’s Office on November 08, 2022 for this project. Staff determined that with the expanded scope of work, the project is still 5 Resolution No. 24-19 Page 2
4882-9904-3949 v1
categorically exempt under Class 1.

NOW, THEREFORE, the City Council of the City of San Clemente does hereby finds, determines and resolves as follows:

SECTION 1. That the above recitations are true and correct and incorporated herein.

SECTION 2. That the Construction Contract Agreement for the Montalvo and Riviera Pedestrian Bridges Coating Replacement, Project No. 23802, is awarded to Harbor Coating & Restoration.

SECTION 3. That the City Manager is authorized and directed to execute a construction contract for the Montalvo and Riviera Pedestrian Bridges Coating Replacement, CIP Project No. 23802 with Harbor Coating & Restoration, in an amount of $539,890, in a form substantially similar to that presented to City Council on February 6, 2024.

SECTION 4. That a 15% project contingency of $81,000 for CIP Project No. 23802 is hereby approved. The City Manager is authorized to utilize the project contingency to the extent necessary and proper.

SECTION 5. That the City Clerk shall certify to the passage and adoption of this resolution and enter it into the book of original resolutions.

PASSED AND ADOPTED this 6th day of February, 2024.

ATTEST:
___________________________ __________________________
City Clerk of the City of Mayor of the City of San
San Clemente, California Clemente, California
6 Resolution No. 24-19 Page 3
4882-9904-3949 v1

STATE OF CALIFORNIA )
COUNTY OF ORANGE ) §

CITY OF SAN CLEMENTE )
I, LAURA CAMPAGNOLO, City Clerk of the City of San Clemente, California, do hereby certify that Resolution No. 24-19 was adopted at a regular meeting of the City Council of the City of San Clemente held on the 6th day of February, 2024, by the following vote:

AYES:

NOES:

ABSENT:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Clemente, California, this _____ day of _________________, 2024. __________________________
CITY CLERK of the City of
San Clemente, California
Approved as to form:
___________________________
Elizabeth A. Mitchell, City Attorney
7 ATTACHMENT 3
City of San Clemente
Bid Results for Project MONTALVO AND RIVIERA PEDESTRIAN BRIDGES COATING REPLACEMENT PROJECT (PN-23802) Issued on 11/30/2023 Bid Due on January 04, 2024 2:00 PM (PST) Exported on 01/04/2024 Vendor Name City State Base Bid Total Bid Amount Format Bid Submit Date
Harbor Coating and Restoration Orange CA 458,390 $539,890.00 Electronic 01/04/2024 6:45:21 AM Stencil Blast US Inc Sunset Beach CA 645,000 $656,125.00 Electronic 01/04/2024 1:10:34 PM MC Painting Oceanside CA 596,485 $669,760.00 Electronic 01/04/2024 1:57:26 PM Abhe & Svoboda, Inc. Jordan MN 875,498 $957,748.00 Electronic 01/04/2024 9:07:14 AM 8 ATTACHMENT 4
1 SECTION 00500

CONTRACT
THIS CONTRACT is made this _____ day of _________, 2024, in the County of Orange, State of California, by and between the City of San Clemente hereinafter called City, and Mahmoud Merzi dba Harbor Coating & Restoration, a sole proprietorship located at 625 W. Katella Avenue #5, Orange, CA 92867, hereinafter called Contractor. City and the Contractor for the considerations stated herein agree as follows:

ARTICLE 1. SCOPE OF WORK. The Contractor shall perform all Work within the time stipulated the contract and shall provide all labor, materials, equipment, tools, utility services, and transportation to complete all of the Work required in strict compliance with the Contract Documents as specified in Article 5 below for the following Project:

MONTALVO AND RIVIERA PEDESTRIAN BRIDGES COATING REPLACEMENT, PROJECT NO. 23802.

The Contractor and its surety shall be liable to City for any damages arising as a result of the Contractor’s failure to comply with this obligation.

ARTICLE 2. TIME FOR COMPLETION. The Work shall be commenced on the date stated in City’s Notice to Proceed. The Contractor shall complete all Work required by the Contract Documents within sixty (60) working days from the commencement date stated in the Notice to Proceed. By its signature hereunder, Contractor agrees the time for completion set forth above is adequate and reasonable to complete the Work.

ARTICLE 3. CONTRACT PRICE. City shall pay to the Contractor as full compensation for the performance of the Contract, subject to any additions or deductions as provided in the Contract Documents, and including all applicable taxes and costs, the sum of Five Hundred Thirty Nine Thousand and Eight Hundred Ninety dollars ($539,890). Payment shall be made as set forth in the General Conditions.

At any time during the term of the Contract, City may, pursuant to the terms and provisions of the Contract Documents, request that the Contractor perform additional work. Contractor shall not perform, nor be compensated for, additional work without written authorization from the City pursuant to the terms and provisions of the Contract Documents. This project includes an 19% contingency in the amount of One Hundred Two Thousand and Five Hundred Eighty dollars ($102,580) for unforeseen conditions. In no event shall approved additional work exceed such project contingency, nor shall the total amount of compensation for work performed under this Contract, including approved additional work, exceed 642,470 dollars ($642,470).

ARTICLE 4. LIQUIDATED DAMAGES/EARLY COMPLETION INCENTIVE. In accordance with Government Code section 53069.85, it is agreed that the Contractor will pay City the sum of $800 for each and every calendar day of delay beyond the time prescribed in the Contract Documents for finishing the Work, as Liquidated Damages and not as a penalty or forfeiture. In the event that Liquidated Damages are not paid, the Contractor agrees City may deduct that 9 ATTACHMENT 4
2 amount from any money due or that may become due the Contractor under the Contract. This Article does not exclude recovery of other damages specified in the Contract Documents.

ARTICLE 5. COMPONENT PARTS OF THE CONTRACT. The “Contract Documents” include the following:

Contract
Bid Bond
Designation of Subcontractors
Information Required of Bidders
Non-Collusion Declaration form
Iran Contracting Act Certification
Public Works Contractor Registration Certification
Performance Bond
Payment Bond
General Conditions
Special Conditions
Technical Specifications
Addenda
Plans and Drawings
Approved and fully executed change orders
Any other documents contained in or incorporated into the Contract The Contactor shall complete the Work in strict accordance with all of the Contract Documents.

All of the Contract Documents are intended to be complementary. Work required by one of the Contract Documents and not by others shall be done as if required by all. This Contract shall supersede any prior agreement of the parties.

ARTICLE 6. PROVISIONS REQUIRED BY LAW. Each and every provision of law required to be included in these Contract Documents shall be deemed to be included in these Contract Documents. The Contractor shall comply with all requirements of applicable federal, state and local laws, rules and regulations, including, but not limited to, the provisions of the California Labor Code and California Public Contract Code which are applicable to this Project.

ARTICLE 7. INDEMNIFICATION. Contractor shall provide indemnification as set forth in the General Conditions.

ARTICLE 8. PREVAILING WAGES. Contractor shall be required to pay the prevailing rate of wages in accordance with the Labor Code which such rates shall be made available at at City of San Clemente Public Works Department or may be obtained online at http//www.dir.ca.gov/dlsr. and which must be posted at the job site.

IN WITNESS WHEREOF, this Contract has been duly executed by the above-named parties, on the day and year above written.
10 ATTACHMENT 4
3 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed on the respective dates set forth opposite of their signatures.

CITY OF SAN CLEMENTE
By:________________________________
ATTEST: Andy Hall, City Manager
______________________________ Dated: ____________________, 2024 CITY CLERK of the City of
San Clemente, California
APPROVED AS TO FORM:
____________________________
Elizabeth A. Mitchell, City Attorney

APPROVED AS TO AVAILABILITY
OF FUNDING:
________________________________
Finance Authorization

Mahmoud Merzi dba Harbor Coating &
Restoration, a sole proprietorship
(“CONTRACTOR”)
_____________________________
Mahmoud Merzi
Dated: __________________, 2024

END OF CONTRACT
11 ---
Notice of Exemption F I L E D Form D
To: NOV 0 8 2022 From: (Public Agency) City of San Clemente Engineering Division, 910 Calle Negocio, Suite 100
OftANGE COUNTY CLER,!S;lj,� DEPARTMENT
County Clerk BY: � DEPUTY
San Clemente, CA. 92673; Attn: Belgin Cuhadaroglu
(Address)
County of _o_
ra_
ng"-e _________ _
12 Civic Center Plaza, P.O. Box 238
Santa Ana, CA 92701
Project Ti
l
l
e: Montalvo and Riviera Pedestrian Bridges Coating Replacement Project.

Project Location - Specific:

The Montalvo bridge spans 96'-8' and Riviera Bridge spans 30', and both bridges are prefabricated steel with timber decking. The Bridges located at 200-ft west of the intersection of Ave Montalvo and Ave Lobeiro, and are in close proximity and parallel to OCTA Metrolink railroad. rrojoct Location -City: San ---------- Clemoote
Description of Nature, Purpose and Beneficiaries of Project:

Project Location - County: Orange
Currently the both bridges coating has become visibly deteriorated and is showing signs of rust, corrosion, and pitting.

Maintenance will include a complete removal and repair of the existing coating system. Coaling system will include applying a rust inhibitor, primer, and paint.

Nnmc of Puhlic: Aecncy Apprnving Pmject: City of San Clemente POSl=-E-0 Name of Person or Agency Carrying Out P
roject:

Exempt Status: (check one)
0 Ministerial (Sec. 21080(b)(I); 15268);
Ctty of San Clemente
0 Declared Emer&ency (Sec. 21080(b)(3); 15269(a)):
0 Emergency Project (Soc. 21080(b)(4): 15269(b)(c));
NOVO 8 2022
DfPARTMEN7
IKJ Categorical Bxemption. State type and section number: _S_e_c _tio_n_1_5_3 _01....:
,_C_la_s_s _1 ___________ _
0 S1atut0ry Exemptions. State code number: ____ ________________ _ Reasons why project is exe.mpt:

Consistent with Section 15301, Class 1, the project consists of general maintenance of components of the existing steel Montalvo and Riviera bridges.

Lead Agency
Contact Person: ----''---------- Kiel Koger Area CodefTelephone/Extension: {949) 361-6187 If filed by applicant:

I. Attach certified document of exemption finding.

2. Has a Notice of Exemption been filed by the public agency approving the project'/ I&:] Yes 0No Signature:
28 � ,?-""� Date: 11/03/2022 Title: Public Works Director Recorded in Official Records, Orange county
: ::::::: :: �:�
i:�ncy Date received for filing at
OP� llf 1
1 1
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1mn�rni1
1�rn ii11� 11111111111 1
1 * $ R O O 1 4 0 5 2 6 6 3 $ * 1 NO FEE
202285000983 1 : 12 pm 11 /08/22
383 Vltlndx Z01

0.00 50.00 0.00 0.00 0.00 0.00 0.00 0.00
ATTACHMENT 5
12 Wildlife and Fish of Department - California of State FEE FILING DOCUMENT ENVIRONMENTAL 2022

RECEIPT CASH
753.5a DFG Previously 101/22) 7_53.5a (REV. 01 DFW '
CLEARLY. PRINT OR TYPE REVERSE. ON INSTRUCTIONS SEE

EMAIL LEADAGENCY AGENCY LEAD

CLEMENTE SAN OF CITY

FILING OF AGENCY COUNTY/STATE
ITI !Orange

TITLE ECT PROJ
I Save 1 _ , Print
NUMBER: RECEIPT
-0972 1110812022 -30
appticat,le) (II NUMBER STATE CLEARINGHOUSE
DATE
11/08/2022

DOCUMENT NUMBER
202285000983

PROJECT REPLACEMENT COATING BRIDGES PEDESTRIAN RIVIERA AND MONTALVO

NAME APPLICANT PROJECT

CLEMENTE SAN OF CITY

ADDRESS APPLICANT PROJECT
100 STE NEGOCIO CALLE 910
{Check appropriote box) APPLICANT PROJECT
Dislrtcl School O Agency Public local 0
FEES: APPLICABLE CHECK
(EIR) Report Impact Environmental D
(MND)(ND) Declaration Mitigate<l/Negative D
L EMA APPLICANT PRO.ECT

STATE CITY

CA CLEMENTE SAN

NUMBER PHONE
(949)361-6187

CODE ZIP
92673
Entity Pnvate 0 Agency S1ate 0 District Special Other 0 $

0.00 ----------
__; ____ ___ $
o
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CDFW to directly due p.,ymenl - (CRP) document Program Regulatory COl1ified O $3,539.25
$2,548.00
--------� $ $1,203.25
o�.o =o
fee trom Exempt 0
(attach) Exemplioo of E'.I Nolice
(attach) Dolennination Effect No CDFW D
ccpy) receipt cash Issued previously (a1tach paid previously Fee 0 ontyJ Board Cootrol Resources Water (State Fee Petition or Application D Water Right fee handling documentary County 0
$ $850.00
$
$ Other 0
METHOD: PAYMENT
Credi! O Cash D

SIGNATURE
X
• PROJECl APPLtCANT OIUGIHAl
Other 0 Chec:l< 0
COFW/ASO · COPY

S RECEIVED AL TOT

TITLE AND NAME PRINTED FILING OF AGENCY

FRANCO CLAUDIA CLERK, DEPUTY
COPY-COVNfYCLERK AOENCY lEAO · COPY

0.00 0.00

0.00 (Rrdl10t2022) 7$.J,!lii OFVI
13 __,..
l
RESOLUTION NO. 24-20

A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF SAN CLEMENTE, CALIFORNIA, OPPOSING
ASSEMBLY CONSTITUTIONAL AMENDMENT 13
(VOTING THRESHOLDS)
WHEREAS, since the adoption of the California Constitution in 1849, there has never been different thresholds for the approval of constitutional amendments based on the content of the amendment; and
WHEREAS, Assembly Constitutional Amendment 13 ("ACA 13") proposes an unprecedented and alarming change in the California Constitution to impose a higher vote threshold ONLY for certain types of amendments to the California Constitution proposed by citizens via a ballot initiative; and
WHEREAS, ACA 13 selectively raises the voter approval requirement for those citizenproposed ballot initiatives making it more difficult for ordinary citizens to pass amendments to the California Constitution that would limit the ability of the State Legislature to increase (impose) taxes upon its already overburdened residents; and WHEREAS, ACA 13 is unfairly lopsided because it places more stringent requirements for amendments to the California Constitution that have the effect of limiting the ability to raise taxes without imposing the same requirements on the legislature, preventing citizens from effectively utilizing the initiative process to limit tax increases; and WHEREAS, in 1978, California voters said "enough!" and wisely adopted Proposition 13 to provide checks and balances on local governments' taxing authority and to ensure a greater representative voice for all Californians who would be taxed; and WHEREAS, the City Council of the City of San Clemente, CA has been historically dedicated to limiting the cost and overreach of government on the taxpayers of San Clemente, as well as protecting San Clemente residents and businesses from onerous fiscal actions by other levels of government which may impair our ability to protect our quality of life and provide for our families; now, therefore be it, NOW, THEREFORE, The City Council of the City of San Clemente does hereby resolve as follows:

Section 1. The City Council of the City of San Clemente, CA stands in firm opposition to ACA13 and any action(s) that would change or weaken the Taxpayer Rights and protections enshrined by the historic, citizen-driven and passed, Proposition 13. 1 Agenda Item: 10B
Resolution No. 24-20 Page 2
The City Council of the City of San Clemente believes ACA 13 defrauds California taxpayers by cunningly increasing the voter approval requirement for those citizen-proposed ballot initiatives that have the effect of limiting the ability to raise taxes. It is in the very best interests of San Clemente voters to VOTE NO on this proposed power-grab amendment put forth by the California Legislature.

Section 2. The City Clerk shall certify to the passage and adoption of this resolution and enter it into the book of original resolutions.

PASSED AND ADOPTED this _____ day of ____________________, _______.

ATTEST:
___________________________ __________________________
City Clerk of the City of Mayor of the City of San
San Clemente, California Clemente, California
2 Resolution No. 24-20 Page 3

STATE OF CALIFORNIA )
COUNTY OF ORANGE ) §

CITY OF SAN CLEMENTE )
I, LAURA CAMPAGNOLO, City Clerk of the City of San Clemente, California, do hereby certify that Resolution No. 24-20 was adopted at a regular meeting of the City Council of the City of San Clemente held on the _______ day of _______________________, _________, by the following vote:

AYES:

NOES:

ABSENT:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Clemente, California, this _____ day of _________________, ________. __________________________
CITY CLERK of the City of
San Clemente, California
Approved as to form:
___________________________
Elizabeth A. Mitchell, City Attorney
3 RESOLUTION NO. 24-21

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SAN CLEMENTE, CALIFORNIA, OPPOSING ASSEMBLY
CONSTITUTIONAL AMENDMENT 1
WHEREAS, in 1978, California voters amended the California Constitution by passing the landmark Proposition 13 ("Proposition 13"), an initiative prohibiting the ad valorem tax rate on real property from exceeding one percent (1%) of the full cash value of the property, subject to certain exceptions; and
WHEREAS, Proposition 13 greatly protects taxpayers and their families by additionally prohibiting any city, county, or special district from imposing a special tax unless imposed by a two thirds (2/3) supermajority vote of the voters in that jurisdiction, subject to certain exceptions; and
WHEREAS, proposed Assembly Constitutional Amendment 1 ("ACA 1") would amend the California Constitution to create additional, dangerous-to-taxpayers, exceptions to Proposition 13 by lowering the two- thirds (66%) supermajority voter threshold to only fifty-five percent (55%) for local jurisdictions to levy an ad valorem tax on real property to pay for bonds issued by the local jurisdiction to fund public infrastructure, affordable housing, down payment assistance, and permanent supportive housing for persons at risk of chronic homelessness, or the acquisition or lease of real property for such purposes; and
WHEREAS, the constant attempts by the State Legislature to erode the important taxpayer protections of Proposition 13 results in overall higher taxes and increases the already onerous tax burden on ALL Californians, and runs counter to conserving economic opportunity in California; and
WHEREAS, the City Council of San Clemente, CA strongly opposes ACA 1 due to the horrible exceptions it would create to the taxpayer protections enshrined in the California Constitution by Proposition 13, and encourages voters to vote a resounding NO on ACA1; now, therefore be it
NOW, THEREFORE, The City Council of the City of San Clemente does hereby resolve as follows:

Section 1. The City Council of San Clemente, CA hereby recommits its staunch support of Taxpayer Rights afforded by Proposition 13, while staunchly opposing the destructive, money-grab attempts of ACA1.
1 Agenda Item: 10C
Resolution No. 24-21 Page 2
Section 2. The City Clerk shall certify to the passage and adoption of this resolution and enter it into the book of original resolutions.

PASSED AND ADOPTED this _____ day of ____________________, _______.

ATTEST:
___________________________ __________________________
City Clerk of the City of Mayor of the City of San
San Clemente, California Clemente, California

STATE OF CALIFORNIA )
COUNTY OF ORANGE ) §

CITY OF SAN CLEMENTE )
I, LAURA CAMPAGNOLO, City Clerk of the City of San Clemente, California, do hereby certify that Resolution No. 24-21 was adopted at a regular meeting of the City Council of the City of San Clemente held on the _______ day of _______________________, _________, by the following vote:

AYES:

NOES:

ABSENT:

AGENDA REPORT

CITY OF SAN CLEMENTE

CITY COUNCIL MEETING

CITY OF SAN CLEMENTE
Meeting Date: February 6, 2024 Agenda Item: 10D
Submitted By: City Clerk’s Department
Subject: Ca..title
CAMPAIGN ..body CONTRIBUTION LIMITS
Fiscal Impact:

If the City Council chooses to establish limits on local campaign contributions, the City would assume the enforcement responsibilities for violations of the regulations. It is challenging to predict the costs associated with these enforcement responsibilities.

Background:

At its meeting of January 16, 2024, the City Council directed Staff to conduct research and return with a report indicating the current campaign contribution limits that other Orange County cities have established in their communities. At present, the City of San Clemente does not have a campaign contribution limit and therefore defaults to the state limit. At the current time, the state campaign contribution limit is $5,500.

The San Clemente City Council has previously considered the issue of campaign contributions on September 1, 2020 (Attachment 1), July 19, 2022 (Attachment 2) and August 16, 2022 (Attachment 3), and each time determined to take no action. In addition to the more recent discussions, the City Council also considered this issue on January 5, 2010 (Attachment 4) and determined to take no action at that time.

Related to this issue and in an effort to maintain transparency related to campaign contributions for elective candidates, the City Clerk staff places all FPPC forms on the City website so that the information is easily accessible to interested parties, without having to submit a public records request.

The City Council requested that as part of this administrative report, information be included on what other Orange County cities do in terms of campaign contribution limits. Below is a summary of the information received:

City Contribution Limit
General Law City/
Charter City
Aliso Viejo $1,000 General Law
Brea Defers to State General Law
Buena Park $4,000 Charter City
Costa Mesa Defers to State General Law
Cypress Defers to State Charter City
Dana Point $880.00 General Law
Fullerton Defers to State General Law
1 Meeting Date: February 6, 2024 Agenda Item: 10D

CITY OF SAN CLEMENTE
Garden Grove Defers to State Charter City
Huntington Beach Defers to State Charter City
Irvine $620.00 Charter City
La Palma Defers to State General Law
Laguna Beach $440.00 General Law
Laguna Hills $1,000 General Law
Laguna Woods $250.00 General Law
Lake Forest Defers to State General Law
Los Alamitos Defers to State Charter City
Mission Viejo Defers to State General Law
Newport Beach $1,400 Charter City
Orange $1,000 General Law
San Juan Capistrano $700.00 General Law
Santa Ana $1,000 Charter City
Stanton Defers to State General Law
Villa Park Defers to State General Law
Westminster Defers to State General Law
Yorba Linda Defers to State General Law
The decision to defer to the state limits or establish other limits, is a decision of the City Council. It should be noted that this report, prepared by staff, does not make a recommendation as to whether the City Council should choose campaign contribution limits or continue to defer to the state.

The City Council may wish to set no city campaign contribution and continue to default to the state limit. Or, the City Council may determine to set a contribution limit either higher or lower than the state limit. However, if the City Council determines to set campaign contribution limits, it is recommended that the City Council take action as soon as possible so that candidates for the 2024 General Municipal Election can be made aware of any changes to the City’s current policy prior to their fundraising.

Council Options:
 Take no action and continue to defer to state contribution limits.  Direct Staff to return with an ordinance setting a campaign contribution limit lower than the state.
 Direct Staff to return with an ordinance setting a campaign contribution limit higher than the state.
 Direct Staff to return to a future City Council meeting with additional information.

Environmental Review/Analysis
This is not a “project” under the California Environmental Quality Act. 2 Meeting Date: February 6, 2024 Agenda Item: 10D

CITY OF SAN CLEMENTE
Recommended Actions:

Staff Recommendation ..recommendation
No later than February 20, 2024 determine a course of action with regard to local campaign contribution limits for elective City office candidates – i.e., either take no action and continue to rely on the state default restrictions or give direction to staff to return with an ordinance to establish limitations that are higher or lower than the state default amounts. ..end
Attachment:

1. Agenda Report dated September 1, 2020

2. Agenda Report dated July 19, 2022

3. Agenda Report dated August 16, 2022

4. Excerpt of Meeting Minutes and Memo from City Attorney dated January 5, 2010.

Notification:

None.
3 Attachment 1
4 AGENDA REPORT

SAN CLEMENTE CITY COUNCIL MEETING
Meeting Date: September 1, 2020
Agenda Item Q (__
Approvals:

City Manager f}}
--- Dept. Head --- Attorney --- Finance 9J::

Department City Clerk/Legislative Administrator (} e,
City Attorney
Subject: AB 571 LOCAL CAMPAIGN CONTRIBUTION LIMITS
Fiscal Impact: No. There would be no direct fiscal impact to the City in selecting one of the options below with regard to establishment of limits on local campaign contributions in City elections.

Summary: This is a report providing background and information about AB 571, which amended the 1974 Political Reform Act to create a default campaign contribution limit for elective city or county office candidates (i.e. the same as the limit for certain elective state office candidates), but does not affect a city or county's ability to set its own limits higher or lower than the default limit. This report does not make a recommendation as to which option the City should choose or at what level a limit should be established {if the City decides to establish a limit), but rather merely sets forth the three (3) options and the legal and administrative ramifications of each option:

1. Set no city campaign contribution limit and default to the state limit;

2. Set a city campaign contribution limit that is lower than the state limit; or

3. Set a city campaign contribution limit that is higher than the state limit.

Background: AB 571 was promulgated based on several findings, including (1) most cities and counties in California do not have independently imposed limitations on contributions to candidates for elective office in those jurisdictions; (2) in cities and counties without campaign contribution limitations, candidates for elective office receive 40 percent or more of their total campaign funds from a single contributor; (3) where people can make unlimited contributions to a candidate for elective city or county office, there is a "risk and the perception that elected officials in those jurisdictions are beholden to their contributors and will act in the best interest of those contributors at the expense of the people"1; and finally, the state has a statewide interest in "preventing actual corruption and the appearance of corruption at all levels of government "2 AB 571 was approved by the Governor on October 8, 2019 and becomes effective on January 1, 2021. AB 571 accomplishes its above salutary goals by allowing cities and counties with no independently imposed local campaign contribution limits the discretion to either set limits or default to the state's limitations. The current state limit 1 See Attachment (AB 571), § 1(e}.

L/d. at 1 f). •
City Attorney/ City Manager Agenda Report
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5 Agenda Report Page2
and counties with no independently imposed local campaign contribution limits the ( discretion to either set limits or default to the state's limitations. The current state\ limit on contributions from an individual per calendar year is $4,700. This amount is subject to change by the Fair Political Practices Commission (FPPC) in 2021.3 Such contribution limits become the default in counties or cities that do not have their own codified contribution limits for local elective office. These limits are separate and apart from the restrictions placed on small contributor or political party committees. Under AB 571, the FPPC will have expanded administration and enforcement authority regarding the default contribution limits for cities and counties without their own local contribution limits, and makes violations of default contribution limits within the FPPC's purview punishable as a misdemeanor. Cities and counties that wish to adopt local contribution limits in light of AB 571 must consider how their own agency will enforce such restrictions, as AB 571 does not provide the FPPC with authority to administer or enforce locally set contribution limits.

Other characteristics of AB 571:
• Extends contribution restrictions for elective county or city office regarding personal loans and for committees created to oppose recall measures; • Allows a candidate for county or city office to carry over campaign expenditures ih connection with a subsequent election for that same office, except in instances where a city and county has barred that practice in light of its own local contribution restrictions; and
• Does not impact how much a local candidate may lend to their own campaign • from their personal funds.

Discussion: As noted in the Summary above, the City Council may decide to go in one of three directions:

1. Do Nothing. Under this scenario, as of January 1, 2021, assuming the City has not established its own local limitations, the statewide campaign contribution restriction of $4,700 from one inc;lividual per calendar year shall be imposed, by default, on those running for elective City office. The FPPC will take responsibility for enforcing the restriction.

2. Set Its Own Limit - Whether Higher or Lower. As noted above, if the City follows this route, it will need to determine the cost of enforcement and how it will pay such an expenditure within the budget. AB 571 does not permit the FPPC jurisdiction to enforce locally established campaign contribution limitations. The following is just a sample of public agencies and what limits or other restrictions they have, which pre-dated AB 571:

3. a. Orange County-$2, 100 limit. See Orange Co. Muni. Code§ 1-6-5. b. City of Irvine - $530 limit. See Irvine Muni. Code § 1-2-404. c. [other examples]
3 Contribution limits may be adjusted by the FPPC in January of odd-numbered years to reflect increases or decreases in ( the Consumer Price Index, rounded to the nearest $100.
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6 Agenda Report Page 3
Recommended
Action: STAFF RECOMMENDS THAT, by no later than December 31, 2020, the City Council determine a course of action with regard to local campaign contribution limits for elective City office candidates - i.e., either do nothing and rely on the State default restrictions or establish limitations that are higher or lower than the State default amounts .
.. _ Attachment: AB 571.

Notification: None.
55452,01100\33216750.3
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7 (j) STATEOFCAL!FORNIA
LEGISLITM AUTHENTICATED 'i{iW11.fl ELECTRONIC LEGAL MATERIAL Assembly Bill No. 571
CHAPTER556
An act to amend and repeal Sections 10003 and 10202 of the Elections Code, and to amend Section 85301 of, to amend, repeal, and add Sections 85305, 85306, 85307, 85315, 85316, 85317, and 85318 of, and to add Section 85702.5 to, the Government Code, relating to the Political Reform Act of 1974.
[Approved by Governor October 8, 2019. Filed with Secretary of State October 8, 2019.]

LEGISLATIVE COUNSEL'S DIGEST
AB 571, Mullin. Political Reform Act of 1974: contribution limits.

The Political Reform Act of 1974 prohibits a person, other than a small contributor committee or political party committee, from making to a candidate for elective state office, for statewide elective office, or for the office of Governor, and prohibits those candidates from accepting from a person, a contribution totaling more than a specified amount per election.

For a candidate for elective state office other than a candidate for statewide elective office, the limitation on contributions is $3,000 per election, as that amount is adjusted by the Fair Political Practices Commission in January of every odd-numbered year.

Existing law authorizes a county, city, or district to limit campaign contributions in local elections. Existing law authorizes the governing board of a school district or of a community college district to limit campaign expenditures or contributions in elections to district offices. The act specifies that it does not prevent the Legislature or any other state or local agency from imposing additional requirements on a person if the requirements do not prevent the person from complying with the act, and that the act does not nullify contribution limitations or prohibitions by any local jurisdiction that apply to elections for local elective office, as specified.

This bill, commencing January 1, 2021, instead would prohibit a person from making to a candidate for elective county or city office, and would prohibit a candidate for elective county or city office from accepting from a person, a contribution totaling more than the amount set forth in the act for limitations on contributions to a candidate for elective state office. This bill would also authorize a county or city to impose a limitation that is different from the limitation imposed by this bill. This bill would make specified provisions of the act relating to contribution limitations applicable to a candidate for a elective county or city office, except as specified.

The act makes a violation of its provisions punishable as a misdemeanor and subject to specified penalties.
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This bill would add the contribution limitation imposed by the bill to the act's provisions, thereby making a violation of the limitation punishable as a misdemeanor and subject to specified penalties. However, the bill would specify that a violation of a limitation imposed by a local government is not subject to the act's enforcement provisions. The bill would authorize a local government that imposes a limitation that is different from the limitation imposed by this bill to adopt enforcement standards for a violation of the limitation imposed by the local government agency, including administrative, civil, or criminal penalties. By expanding the scope of an existing crime with regard to a violation of a contribution limitation imposed by the bill, the bill would impose a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

The Political Reform Act of 1974, an initiative measure, provides that the Legislature may amend the act to further the act's purposes upon a ½ vote of each house of the Legislature and compliance with specified procedural requirements.

This bill would declare that it furthers the purposes of the act.

The people of the State of California do enact as follows:

SECTION 1. The Legislature finds and declares all of the following:
(a) Most states impose limitations on contributions to candidates for elective county and city offices. California is among the minority of states without these contribution limitations.
(b) Most counties and cities in this state have not independently imposed limitations on contributions to candidates for elective offices in those jurisdictions.
( c) In counties and cities in this state that have not imposed limitations on contributions, candidates for elective offices in those jurisdictions often receive contributions that would exceed the limitations for a state Senate campaign, even though most counties and cities contain far fewer people than the average state Senate district.
( d) In counties and cities in this state that have not imposed limitations on contributions, candidates for elective office in those jurisdictions sometimes raise 40 percent or more of their total campaign funds from a single contributor.
( e) A system allowing unlimited contributions to a candidate for elective county or city office creates the risk and the perception that elected officials in those jurisdictions are beholden to their contributors and will act in the best interest of those contributors at the expense of the people. (f) This state has a statewide interest in preventing actual corruption and the appearance of corruption at all levels of government. 95 9-1-20 I 9C-5
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(g) This act establishes a limitation on contributions to a candidate for elective office in a city or county in which the local government has not established a limitation. However, a local government may establish a different limitation that is more precisely tailored to the needs of its communities.

SEC. 2. Section 10003 of the Elections Code is amended to read:
10003. (a) A county may by ordinance or resolution limit campaign contributions in county elections.
(b) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1·, 2021, deletes or extends that date.

SEC. 3. Section 10202 of the Elections Code is amended to read:
10202. (a) A city may, by ordinance or resolution, limit campaign contributions in municipal elections.
(b) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.

SEC, 4. Section 85301 of the Government Code is amended to read:
85301. (a) A person, other than a small contributor committee or political party committee, shall not make to a candidate for elective state office other than a candidate for statewide elective office, and a candidate for elective state office other than a candidate for statewide elective office shall not accept from a person, a contribution totaling more than three thousand dollars ($3,000) per election.
(b) Except to a candidate for Governor, a person, other than a small contributor committee or political party committee, shall not make to a candidate for statewide elective office, and except a candidate for Governor, a candidate for statewide elective office shall not accept from a person other than a small contributor committee or a political party committee, a contribution totaling more than five thousand dollars ($5,000) per election. (c) A person, other than a small contributor committee or political party committee, shall not make to a candidate for Governor, and a candidate for Governor shall not accept from any person other than a small contributor committee or political party committee, a contribution totaling more than twenty thousand dollars ($20,000) per election.
(d) (1) A person shall not make to a candidate for elective county or city office, and a candidate for elective county or city office shall not accept from a person, a contribution totaling more than the amount set forth in subdivision (a) per election, as that amount is adjusted by the Commission pursuant to Section 83124. This subdivision does not apply in a jurisdiction in which the county or city imposes a limit on contributions pursuant to Section 85702.5.
(2) This subdivision shall become operative on January 1, 2021. (e) The provisions of this section do not apply to a candidate's contributions of the candidate's personal funds to the candidates own campaign.

SEC. 5. Section 85305 of the Government Code is amended to read:
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85305. (a) A candidate for elective state office or committee controlled by that candidate shall not make any contribution to any other candidate for elective state office in excess of the limits set forth in subdivision (a) of Section 85301.
(b) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.

SEC. 6. Section 85305 is added to the Government Code, to read:
85305. (a) A candidate for elective state, county, or city office or committee controlled by that candidate shall not make a contribution to any other candidate for elective state, county, or city office in excess of the limits set forth in subdivision (a) of Section 85301. This section does not apply in a jurisdiction in which the county or city imposes a limit on contributions pursuant to Section 85702.5.
(b) This section shall become operative on January 1, 2021.

SEC. 7. Section 85306 of the Government Code is amended to read:
85306. (a) A candidate may transfer campaign funds from one controlled committee to a controlled committee for elective state office of the same candidate. Contributions transferred shall be attributed to specific contributors using a "last in, first out" or ''first in, first out" accounting method, and these attributed contributions when aggregated with all other contributions from the same contributor may not exceed the limits set forth in Section 85301 or 85302. . (b) Notwithstanding subdivision ( a), a candidate for elective-state office, other than a candidate for statewide elective office, who possesses campaign funds on January I, 2001, may use those funds to seek elective office without attributing the funds to specific contributors.
(c) Notwithstanding subdivision (a), a candidate for statewide elective office who possesses campaign funds on November 6, 2002, may use those funds to seek elective office without attributing the funds to specific contributors.
(d) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.

SEC. 8. Section 85306 is added to the Government Code, to read:
85306. (a) A candidate may transfer campaign funds from one controlled committee to a controlled committee for elective state, county, or city office of the same candidate. Contributions transferred shall be attributed to specific contributors using a "last in, first out" or "first in, first out" accounting method, and these attributed contributions when aggregated with all other contributions from the same contributor shall not exceed the limits set forth in Section 85301 or 85302.
(b) Notwithstanding subdivision (a), a candidate for elective state office, other than a candidate for statewide elective office, who possesses campaign funds on January 1, 2001, may use those funds to seek elective office without attributing the funds to specific contributors.
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(c) Notwithstanding subdivision (a), a candidate for statewide elective office who possesses campaign funds on November 6, 2002, may use those funds to seek elective office without attributing the funds to specific contributors.
(d) This section does not apply in a jurisdiction in which the county or city imposes a limit on contributions pursuant to Section 85702.5. (e) This section shall become operative on January 1, 2021.

SEC. 9. Section 85307 of the Government Code is amended to read:
85307. (a) The provisions of this article regarding loans apply to extensions of credit, but do not apply to loans made to a candidate by a commercial lending institution in the lender's regular course ofbusiness on terms available to members of the general public for which the candidate is personally liable.
(b) Notwithstanding subdivision (a), a candidate for elective state office shall not personally loan to the candidate's campaign, including the proceeds of a loan obtained by the candidate from a commercial lending institution, an amount, the outstanding balance of which exceeds one hundred thousand dollars ($100,000). A candidate shall not charge interest on any loan the candidate made to the candidate's campaign.
(c) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.

SEC. 10. Section 85307 is added to the Government Code, to read:
85307. (a) The provisions of this article regarding loans apply to extensions of credit, but do not apply to loans made to a candidate by a commercial lending institution in the lender's regular course of business on terms available to members of the general public for which the candidate is personally liable.
(b) Notwithstanding subdivision (a), a candidate for elective state, county, or city office shall not personally loan to the candidate's campaign, including the proceeds of a loan obtained by the candidate from a commercial lending institution, an amount, the outstanding balance of which exceeds one hmdred thousand dollars ($100,000). A candidate shall not charge interest on any loan the candidate made to the candidate's campaign. This subdivision does not apply to a jurisdiction in which the county or city imposes a limit on contributions pursuant to Section 85702.5.
(c) This section shall become operative on January 1, 2021.

SEC. 11. Section 85315 of the Government Code is amended to read:
85315. (a) Notwithstanding any other provision of this chapter, an elected state officer may establish a committee to oppose the qualification of a recall measure, and the recall election. This committee may be established when the elected state officer receives a notice of intent to recall pursuant to Section 11021 of the Elections Code. An elected state officer may accept campaign contributions to oppose the qualification of a recall measure, and if qualification is successful; the recall election, without regard to the campaign contributions limits set forth in this chapter. The voluntary 95 9-1-20 I 9C-8
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expenditure limits do not apply to expenditures made to oppose the qualification of a recall measure or to oppose the recall election. (b) After the failure of a recall petition or after the recall election, the committee formed by the elected state officer shall wind down its activities and dissolve. Any remaining funds shall be treated as surplus funds and shall be expended within 30 days after the failure of the recall petition or after the recall election for a purpose specified in subdivision (b) of Section 89519.
( c) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or. extends that date.

SEC. 12. Section 85315 is added to the Government Code, to read:
85315. (a) Notwithstanding any other provision of this chapter, an elected state, county, or city officer may establish a committee to oppose the qualification of a recall measure, and the recall election. This committee may be established when the elected state, county, or city officer receives a notice of intent to recall pursuant to Section 11021 of the Elections Code.

An elected state, county, or city officer may accept campaign contributions to oppose the qualification of a recall measure, and if qualification is successful, the recall election, without regard to the campaign contribution limits set forth in this chapter. The voluntary expenditure limits do not apply to expenditures made to oppose the qualification of a recall measure or to oppose the recall election.
(b) After the failure of a recall petition or after the recall election, the committee formed by the .elected state, county, or city officer shall wind down its activities and dissolve. Any remaining funds shall be treated as surplus funds and shall be expended within 30 days after the failure of the recall petition or after the recall election for a purpose specified in subdivision (b) of Section 89519.
(c) This section does not apply in a jurisdiction in which the county or city imposes a limit on contributions pursuant to Section 85702.5. (d) This section shall become operative on January 1, 2021.

SEC. 13. Section 85316 of the Government Code is amended to read:
85316. (a) Except as provided in subdivision (b), a contribution for an election may be accepted by a candidate for elective state office after the date of the election only to the extent that the contribution does not exceed net debts outstanding from the election, and the contribution does not otherwise exceed the applicable contribution limit for that election. (b) Notwithstanding subdivision (a), an elected state officer may accept contributions after the date of the election for the purpose of paying expenses associated with holding the office provided that the contributions are not expended for any contribution to any state or local committee. Contributions received pursuant to this subdivision shall be deposited into a bank account established solely for the purposes specified in this subdivision. (1) A person shall not make, and an elected state officer shall not receive from a person, a contribution pursuant to this subdivision totaling more than the following amounts per calendar year:
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(A) Three thousand dollars ($3,000) in the case of an elected state officer oftheAssembly or Senate.
(B) Five thousand dollars ($5,000) in the case of a statewide elected state officer other than the Governor.
(C) Twenty thousand dollars ($20,000) in the case of the Governor. (2) An elected state officer shall not receive contributions pursuant to paragraph (1) that, in the aggregate, total more than the following amounts per calendar year:
(A) Fifty thousand dollars ($50,000) in the case of an elected state officer of the Assembly or Senate.
(B) One hundred thousand dollars ($ I 00,000) in the case of a statewide elected state officer other than the Governor.
(C) Two hundred thousand dollars ($200,000) in the case of the Governor. (3) Any contribution received pursuant to this subdivision shall be deemed to be a contribution to that candidate for election to any state office that the candidate may seek during the term of office to which the candidate is currently elected, including, but not limited to, reelection to the office the candidate currently holds, and shall be subject to any applicable contribution limit provided in this title. If a contribution received pursuant to this subdivision exceeds the allowable contribution limit for the office sought, the candidate shall return the amount exceeding the limit to the contributor . on a basis to be determined by the Commission. None of the expenditures made by elected state officers pursuant to this subdivision shall be subject to the voluntary expenditure limitations in Section 85400. ( 4) The Commission shall adjust the calendar year contribution limitations and aggregate contribution limitations set forth in this subdivision in January of every odd-numbered year to reflect any increase or decrease in the Consumer Price Index. Those adjustments shall be rounded to the nearest one hundred dollars ($100).
(c) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.

SEC. 14. Section 85316 is added to the Government Code, to read:
85316. (a) Except as provided in subdivision (b), a contribution for an election may be accepted by a candidate for elective state, county, or city office after the date of the election only to the extent that the contribution does not exceed net debts outstanding from the election, and the contribution does not otherwise exceed the applicable contribution limit for that election. (b) Notwithstanding subdivision (a), an elected state officer may accept contributions after the date of the election for the purpose of paying expenses associated with holding the office provided that the contributions are not expended for any contribution to any state or local committee. Contributions received pursuant to this subdivision shall be deposited into a bank account established solely for the purposes specified in this subdivision. (1) A person shall not make, and an elected state officer shall not receive from a person, a contribution pursuant to this subdivision totaling more than the following amounts per calendar year:
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(A) Three thousand dollars ($3,000) in the case of an elected state officer of the Assembly or Senate.
(B) Five thousand dollars ($5,000) in the case of a statewide elected state officer other than the Governor.
(C) Twenty thousand dollars ($20,000) in the case of the Governor. (2) An elected state officer shall not receive contributions pursuant to paragraph (1) that, in the aggregate, total more than the following amounts per calendar year:
(A) Fifty thousand dollars ($50,000) in ~e case of an elected state officer of the Assembly or Senate. '
(B) One hundred thousand dollars ($100,000) in the case ofa statewide elected state officer other than the Governor.
(C) Two hundred thousand dollars ($200,000) in the case of the Governor. (3) Acy contribution received pursuant to this subdivision shall be deemed to be a contribution to that candidate for election to any state office that the candidate may seek during the tenn of office to which the candidate is currently elected, including, but not limited to, reelection to the office the candidate currently holds, and shall be subject to any applicable contribution limit provided in this title. If a contribution received pursuant to this subdivision exceeds the allowable contribution limit for the office sought, the candidate shall return the amount exceeding the limit to the contributor on a basis to be determined by the Commission. The expenditures made by elected state officers pursuant to this subdivision shall not be subject to the voluntary expenditure limitations in Section 85400.
( 4) The Commission shall adjust the calendar year contnbution limitations and aggregate contribution limitations set forth in this subdivision in January of every odd-numbered year to reflect .any increase or decrease in the Consumer Price Index. Those adjustments shall be rounded to the nearest one hundred dollars ($100). •
(c) This section does not apply in a jurisdiction in which the county or city imposes a limit on contributions pursuant to Section 85702.5. (d) This section shall become operative on January 1, 2021.

SEC. 15. Section 85317 of the Government Code is amended to read:
85317 .. (a) Notwithstanding subdivision (a) of Section 85306, a candidate for elective state office may carry over contributions raised in connection with one election for elective state office to pay campaign expenditures incurred in connection with a subsequent election for the same elective state office.
(b) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.

SEC. 16. Section 85317 is added to the Government Code, to read:
85317. (a) Notwithstanding subdivision (a) of Section 85306, a candidate for elective state, county, or city office may carry over contributions raised in connection with one election for elective state, county, or city office to pay campaign expenditures incurred in connection with a subsequent election for the same elective state, county, or city office. This section does not apply 9S
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in a jurisdiction in which the county or city imposes a limit on contributions pursuant to Section 85702.5.
(b) This section shall become operative on January 1, 2021.

SEC. 17. Section 85318 of the Government Code is amended to read:
85318. (a) A candidate for elective state office may raise contributions for a general election before the primary election, and for a special general election before a special primary election, for the same elective state office if the candidate sets aside these contributions and uses these contributions for the general election or special general election. If the candidate for elective state office is defeated in the primary election or special primary election, or otherwise withdraws from the general election or special general election, the general election or special general election funds shall be refunded to the contributors on a pro rata basis less any expenses associated with the raising and administration of general election or special general election contributions. Notwithstanding Section 85201, candidates for elective state office may establish separate campaign contribution accounts for the primary and general elections or special primary and special general elections.
(b) This section shall remain in effect only until January 1, 2021, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2021, deletes or extends that date.

SEC. 18. Section 85318 is added to the Government Code, to read:
85318. (a) A candidate for elective state, county, or city office may raise contributions for a general election before the primary election, and for a special general election before a special primary election, for the same elective state, county, or city office if the candidate sets aside these contributions and uses these contributions for the general election or special · general election. If the candidate for elective state, county, or city office is defeated in the primary election or special primary election, or otherwise withdraws from the general election or special general election, the general election or special general election funds shall be refunded to the contributors on a pro rata basis less any expenses associated with the raising and administration of general election or special general election contributions.

Notwithstanding Section 85201, candidates for elective state, county, or city office may establish separate campaign contribution accounts for the primary and general elections or special primary and special general elections.
(b) This section does not apply in a jurisdiction in which the county or city imposes a limit on contributions pursuant to Section 85702.5. (c) This section shall become operative on January 1, 2021.

SEC. 19. Section 85702.5 is added to the Government Code, to read:
85702.5. (a) A county or city may, by ordinance or resolution, impose a limit on contributions to a candidate for elective county or city office that is different from the limit set forth in subdivision (d) of Section 85301. The limitation may also be imposed by means of a county or city initiative measure.
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(b) A county or city that establishes a contribution limit pursuant to subdivision (a) may adopt enforcement standards for a violation of that limit, which may include administrative, civil, or criminal penalties. (c) The Commission is not responsible for the administration or enforcement of a contribution limit adopted pursuant to subdivision (a). . ( d) This section shall become operative on January 1, 2021. A county or city's limit on contributions to a candidate for elective county or city office that is in effect on the operative date of this section shall be deemed to be a limit imposed pursuant to subdivision (a).

SEC. 20. No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 175 5 6 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

SEC. 21. The Legislature finds and declares that this bill furthers the purposes of the Political Reform Act of 1974 within the meaning of subdivision (a) of Section 81012 of the Government Code. 0 95
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...:5�
Department:

Prepared By:

Subject:

Fiscal Impact:

Summary:

AGENDA REPORT

SAN CLEMENTE CITY COUNCIL MEETING
Meeting Date: Jul5119, 2022
City Clerk . � Joanne Baade, City Cler'e?'"'
Scott Smith, City Attorney
Agenda Item \ O (,,
Approvals:

City Manager $
Dept. Head
Attorne
Finance
��

URGENCY ORDINANCE ENACTING LOCAL CAMPAIGN CONTRIBUTION LIMITS AND POLICY

Local Contribution Limit Ordinance
AB 57 1 (Local Campaign Contribution Limits) was approved by the Governor on October 8, 2019 and became operative on January 1, 2021. AB 571 gave cities the discretion to either set contribution limits of their own choosing (including unlimited contribution limits). or default to the State's contribution limit. At the Council meeting of September 1, 2020, Council determined to not set a local campaign contribution limit, thereby defaulting to the State limit. The current default limit is $4,900 per election per source, but increases every two years to account for inflation.

At its meeting of May 25, 2022, Council directed that the possibility of amending San Clemente's contribution limit be agendized for its meeting of June 7, 2022 to enable Council to consider establishing a contribution limit of $500 per source per election.

At its meeting of June 7, 2022, Council directed Staff to include a provision allowing the contribution limit to be adjusted according to the Consumer Price Index (CPI).

Additionally, Council requested that contribution limits of both $500 and $1,000 be included in brackets in both the draft urgency ordinance and conventional ordinance to enable Council to easily choose between the two amounts.

In accordance with Council's directions, a draft urgency ordinance is attached to this report which, if adopted, would amend the City's contribution limits, allow for CPI increases in the limit and provide definitions and other technical terms to implement these limits. Adoption of this urgency ordinance would enable the campaign regulations to be in place before the November 8, 2022 General Municipal Election season begins in earnest. A back-up conventional ordinance is also recommended to stand in the event the urgency ordinance is challenged or set aside for any reason.

City Clerk Agenda Report
7-19-22 I 1 0C-1
Attachment 2
17 18
Agenda Report Page 2
Below are factors that Council may wish to include in its consideration of whether or not to modify the City of San Clemente's contribution limit threshold :

1. The City would assume responsibility for enforcing contribution limits that vary from the State's default contribution limits. The California Fair Political Practices Commission (FPPC) enforces contribution limits that align with the State's contribution limit. Because the City Council previously voted to default to the State's contribution limit, enforcement is currently the responsibility of the F PPC. If the City were to now adopt contribution limits that are either higher or lower than the State default limit, then the City would be responsible for enforcing its self-imposed limits. As outlined in the attached draft ordinances, enforcement would involve the retainer of a third-party attorney/investigator and could result in litigation when merited.

2. Campaign contribution limits would not apply to Independent Expenditures, Ballot Measure Committees or Committees Seeking an Officer's Recall. A local campaign contribution limit can only apply to direct contributions made to the candidate or to the candidate's controlled committee. The United States Supreme Court, in its 201 O decision in Citizens United v. Federal Election Commission, held that the risk of actual or perceived "pay to play" corruption is a compelling enough governmental concern to reduce First Amendment freedoms and allow limits on direct contributions to a candidate or their controlled committee. The court further determined, however, that the risk of "pay to play" corruption is not the same for independent expenditure committees (IEC) and, hence, limiting their ability to collect and spend money for campaign purposes would violate their First Amendment rights to free speech. In sum, as long as an IEC (i) doesn't give any money directly to a candidate or the candidate's controlled committee, (ii) isn't coordinating with, or acting at the behest of, a candidate or the candidate's controlled committee, and (iii) files the required disclosure paperwork, the amounts that it collects and spends for campaign purposes cannot be limited. Likewise, such limitations may not apply to ballot measure committees or committees seeking an officer's recall because the Court found that there is not enough risk of "pay to play" corruption to justify restricting the First Amendment freedoms of these committees. The attached draft ordinances recognize these Constitutional exceptions.

The City Attorney was able to follow up on the Council's question from the last meeting about any legal constraints on the City's ability to apply different contribution limits to corporate or controlled committees, as opposed to individual contributors. The City Attorney recognized that although some agencies may so differentiate, Citizens United requires the City to make some factual determination about some particular, dis ti net need to regulate corporate or committee contributions more harshly. That case-which is really a series of plurality opinions - held that laws that burden political speech are subject to strict scrutiny under the First Amendment, which level of scrutiny requires the City to show that contribution limits further a compelling interest and are narrowly tailored to achieve that interest.

Any differentiation among individual, corporate, and/or committee contributions would require similar justification. The Citizens United decision and many· subsequent decisions upholding campaign contribution limits have recognized 7-19-22 / 10C-2
19 Agenda Repo1t

Page 3 ends

elimination of political corruption (also known as "pay-to-play") as a compelling interest. However, the Citizens United Court criticized bans on corporate contributions because they discriminated based on the type of "speaker." This reasoning also suggests that federal law would disfavor a differentiation in contribution limits based on the "speaker's" identity (individual, corporate, or committee) without some particular basis for those distinctions. Specifically, the "narrowly tailored" prong would require that the City enactment be based on some factual determination that corporate or committee contributions - as opposed to individual contributions of the same amount - are more likely to create "pay-toplay" corruption . The record for this enactment does not contain this level of substantiation for distinct limits.

Contractor Disclosure of Political Contributions
At
Policy
its May 25, 2022 meeting, the Council also asked that staff prepare a report and City requiring that contracts disclose, independent of state reporting requirements, political contributions
bid
to City Council candidates made during the 12 months preceding a making
or proposal. Receipt of political contributions does not disqualify local officials from decisions relating to the source of those contributions. However, State and local campaign reporting laws require that political candidates and contributors file certain public disclosure documents in accordance with statutory timelines. These reporting deadlines may pre-date the award of contracts for public works and professional services, so it cannot be guaranteed that the public will be made aware of contractors' contributions to Council candidates before those awards.

This Policy requires that contractors submitting bids or proposals to the City include with their bid or proposal a current disclosure of any contributions made to Councilmembers in the 12 months preceding their submittal. This will ensure that those disclosures are available to the public at the time of contract award, whether or not statutorily required material
disclosures have been made during that period. Staff will need to revise the City's contract to include this disclosure form .

Recommended
Actions:

State's
If Council desires to establish Local Campaign Contribution Limits that vary from the default limits, the City Clerk recommends that Council do so through adoption of the below ordinances . If Council wishes to require disclosure of contractor political contributions, the City Clerk recommends that Council adopt Policy and Procedure No. 201-15.

1. Adopt AN URGENCY ORDINANCE OF THE CITY OF SAN CLEMENTE ADDING SECTION 2.04.100 TO CHAPTER 2.04 (CITY COUNCIL) OF TITLE 2 (ADMINISTRATION AND PERSONNEL) OF THE SAN CLEMENTE MUNICIPAL

CODE RELATING TO LOCAL ELECTION CAMPAIGN CONTRIBUTION LIMITS AND REGULATIONS, with the incorporation of campaign contribution limits of either $500 or $1,000 per source per election and allowing for CPI increases . 7-19-22 / 10C-3
20 Age1ula Report Page 4

2. Introduce AN ORDINANCE OF THE CITY OF SAN CLEMENTE ADDING SECTION

2.04.100 TO CHAPTER 2.04 (CITY COUNCIL) OF TITLE 2 (ADMIN ISTRATION AND

PERSONNEL) OF THE SAN CLEMENTE MUNICIPAL CODE RELATING TO LOCAL ELECTION CAMPAIGN CONTRIBUTION LIMITS AND REGULATIONS, with the incorporation of campaign contribution limits of either $500 or $1,000 per source per election and allowing for CPI increases.

3. Adopt Policy and Procedure No. 201-15 (Disclosure of Political Contributions}, effective July 19, 2022.

Attachments: 1. Draft Urgency Ordinance

2. Draft Conventional Ordinance

3. Draft Campaign Contribution Disclosure Policy
Notification: None.
\\cf\data\ch\cilyclerl1\secure\my word\adniinreport-contributionlir.iits.do_cx 7 -19-22 I 10C-4
21 ATTACHMENT 1
URGENCY ORDINANCE NO. __

AN URGENCY ORDINANCE OF THE CITY OF SAN CLEMENTE ADDING SECTION 2.04.100 TO CHAPTER 2.04 (CITY COUNCIL) OF TITLE 2 (ADMINISTRATION AND PERSONNEL) OF THE SAN CLEMENTE

MUNICIPAL CODE RELATING TO LOCAL ELECTION CAMPAIGN

CONTRIBUTION LIMITS AND REGULATIONS
WHEREAS, Assembly Bill No. 571 ("AB 571") imposed a default campaign contribution limit upon cities and counties effective January 1, 2021; and WHEREAS, California Government Code Section 85702.5 permits the City of San Clemente to act by either ordinance or resolution to establish its own campaign contribution limits that differ from those described in Government Code Sections 85301 and 83124; and
WHEREAS, transparency in local elections regarding financial contributions and influence are important to promoting the election process and to ensure a fair Council election process for all candidates; and
WHEREAS, with the beginning of the 2022 election cycle there is now an urgent need to take immediate action to enact the campaign finance provisions herein so that they may be effective to govern the November 8, 2022 General Municipal Election; WHEREAS, to protect the public safety, health, and welfare, the City Council may adopt this Urgency Ordinance to set local campaign contribution limitations and require reasonable campaign finance disclosure for City Council elections as an urgency measure in accordance with Government Code section 36937, subdivision (b) by a fourfifths vote of the City Council.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN CLEMENTE DOES ORDAIN AS FOLLOWS:

SECTION 1. Incorporation of Recitals. The recitals above containing a declaration of the facts constituting the need to take immediate action by urgency measure are each incorporated by reference and adopted as findings by the City Council.

SECTION 2. CEQA. The City Council finds that the proposed amendments to the San Clemente Municipal Code are exempt from the requirements of the California Environmental Quality Act (CEQA) pursuant to Title 14 of the California Code of Regulations, Section 15061 (b )(3) because it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.

SECTION 3. Code Amendment. Section2.04.100 is hereby added to the San Clemente Municipal Code to read in full as follows:
7-19-22 I 10C-5
22 CHAPTER 2.04 - CITY COUNCIL

2.04.010 - City Council Campaign Finance Limitations and Regulations.

A Intent.

It is the intent of the City Council of the City of San Clemente in enacting this section to place realistic and Constitutionally enforceable limits on the amount which may be contributed to candidates' political campaigns in City elections, for the purpose of preventing potential improper or undue influence over elected officials by campaign contributions, to develop a broader base of political efficacy within the community, to provide full and fair enforcement of all the provisions of this Section, and to encourage the public to participate as candidates in elections by simplifying the local regulations as much as possible in matters adequately regulated by State law. This Section is intended to supplement the Political Reform Act of 1974, as amended and in the event of a conflict between that Act and this Section, that Act shall prevail. This Section is enacted pursuant to Article XI, Section 7 of the Constitution of the State of California, and Section 81013 of the California Government Code.

B. Definitions.

1. "Candidate" means an individual who:
a. is listed on the ballot;
b. who has qualified to have write-in votes on that individual's behalf counted by election officials; or
c. who has begun to circulate nominating petitions or authorized others to circulate nominating petitions on the individual's behalf for nomination for or election to any elective City office; or d. who receives a contribution or makes an expenditure or gives consent for any other person to receive a contribution or make an expenditure with a view to bringing about the individual's nomination or election to any elective City office, whether or not the specific elective office for which the candidate will seek nomination or election is known at the time the contribution is received or the expenditure is made and whether or not the candidate has announced the candidacy or filed a declaration of candidacy at such time.
"Candidate" includes any individual running to replace an incumbent City officer who is the subject of a recall election but does not include any person within the meaning of Section 301(b) of the Federal Election Campaign Act of 1971. An individual who becomes a candidate retains status as a 6 7-19-22 / 1 0C-6
23 candidate until such time as that status is terminated pursuant to the Political Reform Act of 197 4 (Government Code Section 84214, or successor statute.

2. "City election" means any general or special election, including a vacancy or recall election held within the City for elective City office or on a City measure.

Each general or special election is a separate election for purposes of this Section.

3. "City measure" means any proposition for the issuance of funding or refunding of bonds of the City, voter approval of local taxes or other revenue matters, or any other question or proposition submitted to the voters of the City at any election held throughout the entire City. "City measure'' includes any measure which is submitted to a popular vote at an election by action of the City Council or which is submitted or is intended to be submitted to a popular vote at an election by initiative, referendum, or recall procedure, whether or not it has qualified for the ballot.

4. "Enforcement authority" under this Section, means that special counsel appointed by the City Manager in consultation with the City Attorney pursuant to Subsection (G).

5. "Person" means any individual or entity, .including without limitation a firm, partnership, joint venture, syndicate, business trust, company, corporation, association, committee, or any other organization or group of persons acting in concert.

Except as otherwise stated herein, the terms of this Section shall have those definitions provided in the Political Reform Act of 1974 ((Government code Section 81000, et. seq . or in the regulations adopted by the California Fair Political Practices Commission to implement the Act.

C. Campaign Finance Disclosure/Electronic Filing.

1. Each candidate and committee must file campaign statements, statements of economic interest, reports, or other documents in the time and manner required by the Political Reform Act of 197 4, as amended (Government Code Section 84100, et seq.). Except as set forth herein, compliance with the requirements of the Act are deemed to be in compliance with this Section.

2. Reportable contributions shall include, without limitation, money paid, loaned, contributed, or otherwise furnished to the candidate or any committee for the use of such candidate or such committee in aid of the candidate's election, or for the qualification, passage, or defeat of any city measure. Said disclosure shall include the name of the contributing person or entity and all other information required to be disclosed by the Political Reform Act of 1974, as amended . 7-19-22 / 10C-7
24 3. All candidates and committees required to file campaign statements, reports, or other documents as referenced herein shall do so for all campaign expenditures made, to aid or oppose, either directly or indirectly, a cand idate's election or the qualification and/or passage of any city measure. Reportable expenditures shall include, without limitation, expenditures made by a candidate, candidate-controlled committee, political party or independent expenditure committee.

4. Any elected officer, candidate, committee or other person required to file campaign statements, reports or other documents required by the Political Reform Act of 1974, as amended, shall file those statements, reports or other documents in person, online or electronically with the city clerk.

6. If the city clerk's electronic system is not capable of accepting a particular type of statement, report or other document, an elected officer, cand idate, committee or other person shall file that document with the city clerk in an alternative format.

D. Limits on Campaign Contributions

1. No person, other than the candidate, is permitted to make to a candidate or candidate-controlled committee, and no candidate-controlled committee treasurer may solicit or accept, any campaign contribution which will cause the total amount contributed by such person with respect to a single city election to exceed [Insert either Five Hundred Dollars ($500.00) or One Thousand Dollars ($1 ,000.00).] • This contribution limit shall be reviewed and, if necessary, adjusted in January at two (2) year intervals beginning in 2024 by the City Clerk to reflect annual changes in the Consumer Price Index (CPI) over the previous two (2) year period . The City Clerk shall use the annual percent change in the Consumer Price Index for All Urban Consumers (CPI-U) in the selected local area of Los Angeles - Riverside - Orange County, CA, to determine the appropriate rate of increase, if any . The City Clerk shall compute the adjustment for each year separately, adding the adjustment for each year to the prior year's limit and then rounding the total adjusted amount to the nearest ten dollar ($10.00) increment for the two (2) year period.

2. A candidate for elective office shall have no more than one candidatecontrolled committee and one checking account into which all campaign contributions shal l be deposited and out of which all expenditures shall be made. 7-19-22 I 10C-8
25 This paragraph shall not prohibit the establishment of savings accounts, but no qualified campaign expenditures shall be made out of these accounts.

3. A person may not make a contribution for any other person under an assumed name or under the name of any other person.

4. The limit in paragraph (1) shall not be deemed to prohibit contributions or loans from a candidate to his/her own candidate-controlled committee in accordance with State law or to limit the amount of his/her own money or property a candidate may contribute, loan to, or expend on behalf of the candidate's own campaign. Contributions by the spouse of a candidate from such spouse's separate property shall be subject to the limit set forth in paragraph (1).

5. The limit in paragraph ( 1) shall not apply to contributions made to a committee which is organized solely for the purpose of supporting or opposing the qualification and/or passage of one or more city measures. However, the disclosure requiremen ts for all committees set forth in Subsection (C) shall apply.

6. The limit in paragraph (1) shall not apply to contributions made to a committee which is organized solely for the purpose of supporting or opposing the recall of an incumbent City officer, but shall apply to all candidates and their controlled committees seeking election to replace the incumbent City officer. The disclosure requirements for all committees set forth in Subsection (C) shall apply.

7. The limit in paragraph (1) shall not apply to political contributions made to and expenditures made by an independent expenditure committee in support of or in opposition to a city measure, or in support of or opposition to the election of a candidate for city office, if the contributions and expenditures were not made at the direction or control of the candidate or his or her controlled committee. However, the disclosure requirements for all committees set forth in Subsection (C) shall apply.

8. The limit in paragraph ( 1) shall not apply to political contributions made prior to the effective date of this Section.

9. If a candidate or the treasurer of a candidate-controlled committee is offered a contribution which would violate this limitation, the candidate or treasurer must refuse the contribution. If, however, a contribution which is in violation of this section is deposited into the campaign trust account, the candidate or treasurer must report in writing within five days of the receipt of the contribution to the City Clerk the facts surrounding such payment or contribution and, to the extent permitted by applicable law, return the contribution.

E. Suppliers of goods and services - Disclosure of records required 7-19-22 I 10C-9
26 No person who supplies goods or services or both goods and services to a candidate or any committee for use in connection with the campaign of a candidate or for or against a city measure may refuse to divulge or disclose to the enforcement authority that person's record of any expenditures made by the cand idate or committee in payment fo r such goods or services or both.

F. Duties of the City Clerk
In addition to other duties required of the City Clerk under the terms of this Section, the City Clerk must:

1. Supply appropriate forms and manuals prescribed by the California Fair Political Practices Commission to implement the Political Reform Act of 1974, as amended. These forms and manuals must be furnished to all candidates and committees, and to all other persons required to report;

2. Determine whether required documents have been filed and, if so, whether· they conform on their face with the requirements of State law and this Section;

3. Notify promptly all persons and known committees who have failed to file a document in the form and at the time required by State law and this Section;

4. Report apparent violations of this Section and applicable State law to the enforcement authority;

5. Compile and maintain a current list of all statements or parts of statements filed with the city clerk's office pertaining to each candidate and each city measure;

6. Cooperate with the City Attorney and enforcement authority in the performance of the duties of the enforcement authority as prescribed in this Section and applicable State laws and to determine the appropriate enforcement.

G. Enforcement authority - Duties, complaints, legal actions, investigatory powers.

1. The City Attorney must not investigate or prosecute any alleged violation of this Section, but will defend the constitutionality and legality of this Section in any civil proceeding in which the City or the City Council is a party.

2. Review of complaints of violation of this Section and criminal prosecution thereof may be commenced only by the enforcement authority appointed by the City Manager. The enforcement authority is authorized to commence and prosecute civil litigation to compel compliance with this Section or to 7-19-22 / 10C-10
27 enjoin conduct in violation of this Section. Prior to each election, the City Manager, in consultation with the City Attorney, will appoint an enforcement authority for that election. If the appointment of an additional enforcement authority becomes necessary or appropriate, the City Manager, in consultation with the City Attorney, will appoint such additional enforcement authority as may be required. No enforcement or prosecution or action of the enforcement authority is subject to the review or control of the City Council or the City Attorney. The City Council shall appropriate sufficient funds from the City's treasury to retain the services of the enforcement authority and to permit him/her to fully investigate any alleged violations of this Section and, if necessary, to take action to enforce this Section.

3. Any resident of the City who believes that a violation of this Section has occurred may file a written complaint requesting investigation of such violation by the enforcement authority. The complainant shall file the complaint with the City Clerk under penalty of perjury and include proof that the complainant is a resident of the City. Anonymous or non-resident complaints will not be reviewed and/or investigated. The complaint shall state a full recitation of all facts that are alleged to constitute a violation of this Section . If a complaint does not comply with these requirements, the City Clerk shall return the complaint to the complainant, with an explanation as to why it is insufficient for filing . Within five working days after accepting the complaint for filing, the City Clerk shall forward it to the enforcement authority.

4. The enforcement authority shall, within thirty (30) calendar days of receiving the complaint, make a determination of whether there is probable cause to believe that a violation occurred. If no probable cause is determined to exist, the complaint shall be dismissed summarily and interested parties shall be notified of the dismissal in writing .

5. If the enforcement authority determines there is probable cause to believe that a violation of this Section has occurred, the enforcement authority may refer the matter to the District Attorney for criminal prosecution or may conduct an investigation and commence such administrative, civil or criminal legal action as it deems necessary for the enforcement of this Section. No enforcement, prosecution or legal action by the enforcement authority shall be subject to the review or control of the City Council or City Attorney.

6. The enforcement authority shall not investigate or take any further action regarding any alleged violation which has been referred to the District Attorney or which is already the subject of a complaint filed with the Fair Political Practices Commission, until the investigation of that complaint is complete.
7-19-22 I 1 0C-11
28 7. The enforcement authority has such investigative powers as are necessary for the performance of duties described in this Section and may demand and be furnished records of campaign contributions and expenditures of any person or committee at any time. In the event that production of such records is refused, the enforcement authority may commence litigation to complete such production.

8. The enforcement authority is immune to liability for its enforcement of this Section.

9. Any action alleging violation of this Section must be commenced within two years of the time the alleged violation occurred.

H. Penalties

1. Any person who knowingly or willfully violates any provisions of this Section is guilty of a misdemeanor.

2. If any person is found to have violated Subsection (D), whether by civil, criminal or administrative enforcement action, the amount of funds received constituting such violation shall be paid by the candidate or committee that received such funds to the City Manager for deposit into the City's general fund. If any person is found to have violated any other sub-chapter of this Section, the fine imposed in connection with such violation shall be in the amount of $250.00 for the first 30 days after said violation, $500.00 for the next 30 days after said violation and $1,000.00 for any period in excess of 60 days following said violation, and shall be paid to the City Manager for deposit into the City's general fund .

3. If any candid ate is convicted of a violation of any provision of this Section by a court of competent jurisdiction, the court shall be authorized, to the maximum extent allowed by State law, to declare the candidate's election void or, if the candidate has already assumed office, to remove the candidate from office and declare such office vacant, to be filled in accordance with applicable State law. The Court shall also be authorized to declare the candidate/officer ineligible to hold any City office, up to the maximum amount of time allowed by State law for the offense.

I. Rules of Construction
This Section will be construed liberally in order to effectuate its purposes. No error, irregularity, informality, neglect or omission of any person in any procedure taken under this Section which does not directly affect the jurisdiction of the City to control campaign contributions and expenditures voids the effect of this Section." SECTION 4. Publication. The City Clerk shall certify to the adoption of this Urgency Ordinance and cause it, or a summary of it, to be published once within 15 days of 7-19-22 / 10C-12
29 adoption in a newspaper of general circulation printed and published within the City of San Clemente, and shall post a certified copy of this Urgency Ordinance, including the vote for and against the same, in the Office of the City Clerk in accordance with California Government Code, section 36933.

SECTION 5. Records. The documents and materials associated with this Urgency Ordinance that constitute the record of proceedings on which the City Council's findings and determinations are based are located at City Hall, 910 Calle Negocio, San Clemente, CA 92673.

SECTION 6. Severability. If any provision of this Urgency Ordinance or its application to any person or circumstance is held invalid, such invalidity has no effect on the other provisions or applications of the Urgency Ordinance that can be given effect without the invalid provision or application, and to this extent, the provisions of this ordinance are severable. The City Council declares that it would have adopted this Urgency Ordinance irrespective of the invalidity of any portion thereof.

SECTION 7. Effective Date. This Urgency Ordinance shall become effective immediately upon its adoption.

APPROVED AND ADOPTED this __ day of __ , 2022.

Gene James, Mayor
ATTEST:

Laura Campagnolo, Legislative Administrator

STATE OF CALIFORNIA

COUNTY OF ORANGE

C ITV OF SAN CLEMENTE
)
) ss.
)
I, Laura Campagnolo, Legislative Administrator of the City of San Clemente, California, hereby certify that Urgency Ordinance No. ___ , the reading in full thereof unanimously waived, was duly passed and adopted at a regular meeting of the City Council held on the __ day of __________ , by the following vote:

AYES:

NOES:

ABSENT:
7-19-22 / 10C-13
30 IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Clemente, California, this __ day of
APPROVED AS TO FORM:

CITY ATTORNEY

LEGISLATIVE ADMINISTRATOR
of the City of San Clemente,
California
\lcf\data\chlcilyclerklsecure\my word\campaigncontribulionordinance-urgency.docx 7-19-22 I 10C-14
31 ATTACHMENT 2
ORDINANCE NO. __

AN ORDINANCE OF THE CITY OF SAN CLEMENTE ADDING SECTION

2.04.100 TO CHAPTER 2.04 (CITY COUNCIL) OF TITLE 2
(ADMINISTRATION AND PERSONNEL) OF THE SAN CLEMENTE

MUNICIPAL CODE RELATING TO LOCAL ELECTION CAMPAIGN

CONTRIBUTION LIMITS AND REGULATIONS
WHEREAS, Assembly Bill No. 571 ("AB 571") imposed a default campaign contribution limit upon cities and counties effective January 1, 2021; and WHEREAS, California Government Code Section 85702.5 permits the City of San Clemente to act by either ordinance or resolution to establish its own campaign contribution limits that differ from those described in Government Code Sections 85301 and 83124; and
WHEREAS, transparency in local elections regarding financial contributions and influence are important to promoting the election process and to ensure a fair Council election process for all candidates; and
WHEREAS, with the beginning of the 2022 election cycle it is necessary to enact the campaign finance provisions herein so that they may be effective to govern the November 8, 2022 General Municipal Election; and
WHEREAS, in adopting this Ordinance, is the City Council's intention to promote transparency and ensure a fair election process by setting local campaign contribution limitations and requiring reasonable campaign finance disclosure for City Council elections; and
WHEREAS, any and all other legal prerequisites relating to the adoption of this Ordinance have occurred.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN CLEMENTE DOES ORDAIN AS FOLLOWS:

SECTION 1. Incorporation of Recitals. The recitals above are each incorporated by reference and adopted as findings by the City Council as if fully set forth herein.

SECTION 2. CEQA. The City Council finds that the proposed amendments to the San Clemente Municipal Code are exempt from the requirements of the California Environmental Quality Act (CEQA) pursuant to Title 14 of the California Code of Regulations, Section 15061 (b)(3) because it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.

SECTION 3. Code Amendment. Section 2.04.100 is hereby added to the San Clemente Municipal Code to read in full as follows:
7 -19-22 I 1 OC-15
32 CHAPTER 2.04 - CITY COUNCIL

2.04.010 - City Council Campaign Finance Limitations and Regulations.

A. Intent.

It is the intent of the City Council of the City of San Clemente in enacting this section to place realistic and Constitutionally enforceable limits on the amount which may be contributed to candidates' political campaigns in City elections, for the purpose of preventing potential improper or undue influence over elected officials by campaign contributions , to develop a broader base of political efficacy within the community, to provide full and fair enforcement of all the provisions of this Section, and to encourage the public to participate as candidates in elections by simplifying the local regulations as much as possible in matters adequately regulated by State law. This Section is intended to supplement the Political Reform Act of 1974, as amended and in the event of a conflict between that Act and this Section, that Act shall prevail. This Section is enacted pursuant to Article XI, Section 7 of the Constitution of the State of California, and Section 81013 of the California Government Code.

B. Definitions .

1. "Candidate" means an individual who:
a. is listed on the ballot;
b. who has qualified to have write-in votes on that individual's behalf counted by election officials ; or
c. who has begun to circulate nominating petitions or authorized others to circulate nominating petitions on the individual's behalf for nomination for or election to any elective City office; or d. who receives a contribution or makes an expenditure or gives consent for any other person to receive a contribution or make an expenditure with a view to bringing about the individual's nomination or election to any elective City office, whether or not the specific elective office for which the candidate will seek nomination or election is known at the time the contribution is received or the expenditure is made and whether or not the candidate has announced the candidacy or filed a declaration of candidacy at such time.
"Candidate" includes any individual running to replace an incumbent City officer who is the subject of a recall election but does not include any person within the meaning of Section 301(b) of the Federal Election Campaign Act of 1971 . An individual who becomes a candidate retains status as a 7-19-22 / 1 0C-16
33 candidate until such time as that status is terminated pursuant to the Political Reform Act of 1974 (Government Code Section 84214, or successor statute.

2. "City election" means any general or special election, including a vacancy or recall election held within the City for elective City office or on a City measure.

Each general or special election is a separate election for purposes of this Section.

3. "City measure" means any proposition for the issuance of funding or refunding of bonds of the City, v0ter approval of local taxes or other revenue matters, or any other question or proposition submitted to the voters of the City at any election held throughout the entire City. "City measure" includes any measure which is submitted to a popular vote at an election by action of the City Council or which is submitted or is intended to be submitted to a popular vote at an election by initiative, referendum, or recall procedure, whether or not it has qualified for the ballot.

4. "Enforcement authority" under this Section, means that special counsel appointed by the City Manager in consultation with the City Attorney pursuant to Subsection (G).

5. "Person" means any individual or entity, including without limitation a firm, partnership, joint venture, syndicate, business trust, company, corporation, association, committee, or any other organization or group of persons acting in concert.

Except as otherwise stated herein, the terms of this Section shall have those definitions provided in the Political Reform Act of 1974 ((Government code Section 81000, et. seq. or in the regulations adopted by the California Fair Political Practices Commission to implement the Act.

C. Campaign Finance Disclosure/Electronic Filing.

2. Reportable contributions shall include, without limitation, money paid, loaned , contributed, or otherwise furnished to the candidate or any committee for the use of such candidate or such committee in aid of the candidate's election, or for the qualification, passage, or defeat of any city measure. Said disclosure shall include the name of the contributing person or entity and all other information required to be disclosed by the Political Reform Act of 1974, as amended . 7-19-22 / 10C-17
34 3. All candidates and committees required to file campaign statements, reports, or other documents as referenced herein shall do so for al l campaign expenditures made, to aid or oppose, either directly or indirectly, a candidate's election or the qualification and/or passage of any city measure. Reportable expenditures shall include, without limitation, expenditures made by a candidate, candidate-controlled committee, political party or independent expenditure committee.

6. If the city clerk's electronic system is not capable of accepting a particular type of statement, report or other document, an elected officer, candidate, committee or other person shall file that document with the city clerk in an alternative format.

D. Limits on Campaign Contributions

1. No person, other than the candidate, is permitted to make to a candidate or candidate-controlled committee, and no candidate-controlled committee treasurer may solicit or accept, any campaign contribution which will cause the total amount contributed by such person with respect to a single city election to exceed [Insert either Five Hundred Dollars ($500.00) or One Thousand Dollars ($1,000.00).] This contribution limit shall be reviewed and, if necessary, adjusted in January at two (2) year inteNals beginning in 2024 by the City Clerk to reflect annual changes in the Consumer Price Index (CPI) over the previous two (2) year period. The City Clerk shall use the annual percent change in the Consumer Price Index for All Urban Consumers (CPI-U) in the selected local area of Los Angeles - Riverside - Orange County, CA, to determine the appropriate rate of increase, if any. The City Clerk shal l compute the adjustment for each year separately, adding the adjustment for each year to the prior year's limit and then rounding the total adjusted amount to the nearest ten dollar ($10.00) increment for the two (2) year period.

2. A candidate for elective office shall have no more than one candidatecontrolled committee and one checking account into which all campa ig n contributions shall be deposited and out of which all expenditures shall be made. 7-19-22 / 10C-18
35 This paragraph shall not prohibit the establishment of savings accounts, but no qualified campaign expenditures shall be made out of these accounts.

3. A person may not make a contribution for any other person under an assumed name or under the name of any other person.

5. The limit in paragraph (1) shall not apply to contributions made to a committee which is organized solely for the purpose of supporting or opposing the qualification and/or passage of one or more city measures. However, the disclosure requirements for all committees set forth in Subsection (C) shall apply.

8. The limit in paragraph (1) shall not apply to political contributions made prior to the effective date of this Section.

E. Suppliers of goods and services - Disclosure of records required 7-19-22 / 10C-19
36 No person who supplies goods or services or both goods and services to a candidate or any committee for use in connection with the campaign of a candidate or for or against a city measure may refuse to divulge or disclose to the enforcement authority that person's record of any expenditures made by the candidate or committee in payment for such goods or services or both.

F. Duties of the City Clerk
In addition to other duties required of the City Clerk under the terms of this Section, the City Clerk must:

2. Determine whether required documents have been filed and, if so, whether they conform on their face with the requirements of State law and this Section;

3. Notify promptly all persons and known committees who have failed to file a document in the form and at the time required by State law and this Section;

4. Report apparent violations of this Section and applicable State law to the enforcement authority;

5. Compile and maintain a current list of all statements or parts of statements filed with the city clerk's office pertaining to each candidate and each city measure;

G. Enforcement authority - Duties, complaints, legal actions, investigatory powers.

1. The City Attorney must not investigate or prosecute any alleged violation of this Section,· but will defend the constitutionality and legality of this Section in any civil proceeding in which the City or th e City Council is a party.

2. Review of complaints of violation of this Section and criminal prosecution thereof may be commenced only by the enforcement authority appointed by the City Manager. The enforcement authority is authorized to commence and prosecute civil litigation to compel compliat1ce with this Section or to 7-19-22 I 10C-20
37 enjoin conduct in violation of this Section. Prior to each election, the City Manager, in consultation with the City Attorney, will appoint an enforcement authority for that election. If the appointment of an additional enforcement authority becomes necessary or appropriate, the City Manager, in consultation with the City Attorney, will appoint such additional enforcement authority as may be required . No enforcement or prosecution or action of the enforcement authority is subject to the review or control of the City Council or the City Attorney. The City Council shall appropriate sufficient funds from the City's treasury to reta_in the services of the enforcement authority and to permit him/her to fully investigate any alleged violations of this Section and, if necessary, to take action to enforce this Section.

3. Any resident of the City who believes that a violation of this Section has occurred may file a written complaint requesting investigation of such violation by the enforcement authority. The complainant shall file the complaint with the City Clerk under penalty of perjury and include proof that the complainant is a resident of the City. Anonymous or non-resident complaints will not be reviewed and/or investigated. The complaint shall state a full recitation of all facts that are alleged to constitute a violation of this Section. • If a complaint does not comply with these requirements, the City Clerk shall return the complaint to the complainant, with an explanation as to why it is insufficient for filing. Within five working days after accepting the complaint for filing, the City Clerk shall forward it to the enforcement authority.

6. The enforcement authority shall not investigate or take any further action regarding any alleged violation which has been referred to the District Attorney or which is already the subject of a complaint filed with the Fair Political Practices Commission, until the investigation of that complaint is complete.
7-19-22 / 10C-21
38 7. The enforcement authority has such investigative powers as are necessary for the performance of duties described in this Section and may demand and be furnished records of campaign contributions and expenditures of any person or committee at any time. In the event that production of such records is refused , the enforcement authority may commence litigation to complete such production.

8. The enforcement authority is immune to liability for its enforcement of this Section.

9. Any action alleging violation of this Section must be commenced within two years of the time the alleged violation occurred.

H. Penalties

1. Any person who knowingly or willfully violates any provisions of this Section is guilty of a misdemeanor.

2. If any person is found to have violated Subsection (D), whether by civil , criminal or administrative enforcement action, the amount of funds received constituting such violation shall be paid by the candidate or committee that received such funds to the City Manager for deposit into the City's general fund . If any person is found to have violated any other sub-chapter of this Section, the fine imposed in connection with such violation shall be in the amount of $250.00 for the first 30 days after said violation, $500.00 for the · next 30 days after said violation and $1 ,000.00 for any period in excess of 60 days following said violation, and shall be paid to the City Manager for deposit into the City's general fund.

3. If any candidate is convicted of a violation of any provision of this Section by a court of competent jurisdiction, the court shall be authorized, to the maximum extent allowed by State law, to declare the candidate's election void or, if the candidate has already assumed office, to remove the candidate from office and declare such office vacant, to be filled in accordance with applicable State law. The Court shall also be authorized to declare the candidate/officer ineligible to hold any City office, up to the maximum amount of time allowed by State law for the offense.

I. Rules of Construction
This Section will be construed liberally in order to effectuate its purposes. No error, irregularity, informality, neglect or omission of any person in any procedure taken under this Section which does not directly affect the jurisdiction of the City to control campaign contributions and expenditures voids the effect of this Section." SECTION 4. Publication. The City Clerk shall certify to the adoption of this Ordinance and cause it, or a summary of it, to be published once within 15 days of adoption in a 7-19-22 / 10C-22
39 newspaper of general circulation printed and published within the City of San Clemente, same,
and shall post a certified copy of this Ordinance, including the vote for and against the section
in the Office of the City Clerk in accordance with California Government Code, 36933 .

SECTION 5. Records. The documents and materials associated with this Ordinance that
determinations
constitute the record of proceedings on which the City Council's findings and CA
are based are located at City Hall, 910 Calle Negocio, San Clemente, 92673.

SECTION 6. Severability.
person or
If any provision of this Ordinance or its application to any circumstance
provisions
is held invalid, such invalidity has no effect on the other provision
or applications of the Ordinance that can be given effect without the invalid severable.
or application, and to this extent, the provisions of this ordinance are The City Council declares that it would have adopted this Ordinance irrespective of the invalidity of any portion thereof.

SECTION 7. Effective Date. This Ordinance shall become effective 30 days after its adoption.

APPROVED AND ADOPTED this __ day of __ , 2022.

Gene James , Mayor

STA TE OF CALIFORNIA
COUNTY OF ORANGE ss.

CITY OF SAN CLEMENTE
California,
I, Laura Campagnolo, Legislative Administrator of the City of San Clemente, hereby certify that Ordinance No. ___ having been regularly introduced at the meeting of ___________ , was again introduced, the reading in full City
thereof
Council
unanimously waived, and duly passed and adopted at a regular meeting of the held on the __ day of __________ , and said ordinance was adopted by the following vote:

AYES:

NOES:

ABSENT:

City
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the of San Clemente, California, this __ day of
7 -19-22 / 1 0C-23
40 APPROVED AS TO FORM:

CITY ATTORNEY
\\cf\datalchlcityclerklsecure\my word\campa ignordinance.docx

LEGISLATIVE ADMINISTRATOR
of the City of San Clemente,
California
7-19-22 I 10C-24
41 ATTACHMENT 3

POLICY AND PROCEDURE
-~ - .~ --··- ·- -,._,,__,__~ Subject: Disclosure of Political Contributions Index: City Council Number: 201-15
Effective Date: July 19, 2022 Prepared by: City Attorney Approved by.
--~--=---·- #,:_ .. ....... , .. I ~ · - ~#

1.0 PURPOSE:

Receipt of political contributions does not disqualify local officials from making decisions relating to the source of those contributions. However, State and local campaign reporting laws require that political candidates and contributors file certain public disclosure documents in accordance with statutory timelines. These reporting deadlines may pre-date the award of contracts for public works and professional services , so it cannot be guaranteed that the public will be made aware of contractors' contributions to Council candidates before those awards.

This Policy requires that contractors submitting bids or proposals to the City include with that bid or proposal a current disclosure of any contributions made to Councilmembers in the 12 months preceding that submittal. This will ensure that those disclosures are available to the public at the time of contract award, whether or not statutorily required disclosures have been made during that period.

2.0 ORGANIZATIONS AFFECTED:

All departments and contractors

3.0 POLICY:

All bids or proposals for services submitted to the City shall include a written disclosure to the City declaring any political contributions of money, in-kind services, or loans made to any member of the City Council within the 12 months preceding the submittal. Contractors shall submit the disclosure prior to the contract being approved, renewed or extended by the City.

4.0 PROCEDURE:

It shall be the responsibility of staff drafting requests for bids or proposals to include in said request a disclosure statement form in substantially the form attached hereto. Said disclosure form shall be available for public inspection prior to contract award, renewal or extension of the contract or shall be contained in the 55452.02200',],1~ 8)j 66.'.l
7-19-22 / 10C-25
42 recommendation for such action when presented to the City Council. Bids or proposals lacking said disclosure shall be deemed incomplete.

CITY OF SAN CLEMENTE

DECLARATION OF POLITICAL CONTRIBUTIONS
Using the space provided below, please list any political contributions of money, in-kind services, or loans made to any member of the City Council within the last twelve (12) months by Contractor and all of Contractor's employees, including any employee(s) that applicant intends to assign to perform the work or seNices described in this Agreement:

To the best of my knowledge, I declare under penalty of perjury that the foregoing is true and was executed at:

City/County/State Date
Name of Contractor Print Name
Signature
NOTE: THIS DECLARATION IS INCLUDED AS PART OF THE AGREEMENT AND MUST BE SIGNED AND ATTACHED HERETO.
2 554 52.02200\H•I SJ 56G .2
7-19-22 / 10C-26
Attachment 3
43 .. ;
i:

NC
,
~' .,,
IFO~
Department:

Prepared By:

Subject:

Fiscal Impact:

AGENDA REPORT

SAN CLEMENTE CITY COUNCIL MEETING
Meeting Date: August 16, 2022
City Clerk
Joanne Baade, City Clerk
Scott Smith, City Attorney
Agenda Item \QB
Approvals:

City Manager (if2. 2J>
Dept. Head --- Attorney Q
Finance :n,~
URGENCY ORDINANCE ENACTING LOCAL CAMPAIGN C0NTRIBUTIG°N LIMITS AND POLICY

REGARDING CONTRACTOR DISCLOSURE OF POLITICAL CONTRIBUTIONS Yes. If Council adopts campaign contribution limits for elective City office candidates that vary from the State's default limit (that is currently set at $4,900 per source per election) then the City, as opposed to the Fair Political Practices Commission, would be required to enforce its contribution limits. Adding the Contractor Disclosure Form to City contracts, RFPs, and bid processes would require minimal additional staff time . ------------------------ Summary: Local Contribution Limit Ordinance
AB 571 (Local Campaign Contribution Limits) was approved by the Governor on October 8, 2019 and became operative on January 1, 2021. AB 571 gave cities the discretion to either set contribution limits of their own choosing (including unlimited contribution limits) or default to the State's contribution limit. At the Council meeting of September 1, 2020, Council determined to not set a local campaign contribution limit, thereby defaulting to the State limit. The current default limit is $4,900 per election per source, but increases every two years to account for inflation.

At its meeting of June 7, 2022, Council directed Staff to include a provision allowing the contribution limit to be adjusted according to the Consumer Price Index (CPI).

Additionally, Council requested that contribution limits of both ·$500 and $1 ,000 be included in brackets in both the draft urgency ordinance and conventional ordinance to enable Council to easily choose between the two amounts.

In accordance with Council's directions, a draft urgency ordinance is attached to this report which, if adopted, would amend the City's contribution · limits, allow for CPI increases in the limit and provide definitions and other technical terms to implement these limits. Adoption of this urgency ordinance would enable the campaign regulations to be in place before the November 8, 2022 General Municipal Election season begins in earnest. A back-up conventional ordinance is also recommended to stand in the event the urgency ordinance is challenged or set aside for any reason.

City Clerk Agenda Report
·s-16-22 / 10B-1
44 Agenda Report Page 2
Below are factors that Council may wish to include in its consideration of whether or not to modify the City of San Clemente's contribution limit threshold:

1. The City would assume responsibility for enforcing contribution limits that vary from the State's default contribution limits. The California Fair Political Practices Commission (FPPC) enforces contribution limits that align with the State's contribution limit. Because the City Council previously voted to default to the State's contribution limit, enforcement is currently the responsibility of the FPPC. If the City were to now adopt contribution limits that are either higher or lower than the State default limit, then the City would be responsible for enforcing its self-imposed limits. As outlined in the attached draft ordinances, enforcement would involve the retainer of a third-party attorney/investigator and could result in litigation when merited.

2. Campaign contribution limits would not apply to Independent Expenditures, Ballot Measure Committees or Committees Seeking an Officer's Recall. A local campaign contribution limit can only apply to direct contributions made to the candidate or to the candidate's controlled committee. The United States Supreme Court, in its 2010 decision in Citizens United v. Federal Election Commission, held ---1-h-atthe .. riskof-actual··orperceived···'ipayto·plai'--corruption·· is-:acompelling ·enough----· governmental concern to reduce First Amendment freedoms and allow limits on direct contributions to a candidate or their controlled committee. The court further determined, however, that the risk of "pay to play" corruption is not the same for independent expenditure committees (IEC) and, hence, limiting their ability to collect and spend money for campaign purposes would violate their First Amendment rights to free speech. In sum, as long as an IEC (i) doesn't give any money directly to a candidate or the candidate's controlled committee, (ii) isn't coordinating with, or acting at the behest of, a candidate or the candidate's controlled committee, and (iii) files the required disclosure paperwork, the amounts that it collects and spends for campaign purposes cannot -be limited. Likewise, such limitations may not apply to ballot measure committees or committees seeking an officer's recall because the Court found that there is not enough risk of "pay to play" corruption to justify restricting the First Amendment freedoms of these committees. The attached draft ordinances recognize these Constitutional exceptions.

The City Attorney was able to follow up on the Council's question about any legal constraints on the City's ability to apply different contribution limits to corporate or controlled committees, as opposed to individual contributors. The City Attorney recognized that although some agencies may so differentiate, Citizens United requires the City to make some factual determination about some particular, distinct need to regulate corporate or committee contributions more harshly. That case - which is really a series of plurality opinions - held that laws that burden political speech are subject to strict scrutiny under the First Amendment, which level of scrutiny requires the City to show that contribution limits further a compelling interest and are narrowly tailored to achieve that interest. Any differentiation among individual, corporate, and/or committee contributions would require similar justification . The Citizens United decision and many subsequent decisions upholding campaign contribution limits have reco_gnized elimination of 8-16-22 I 10B-2
45 Agenda Report
Recommended
Action:

Page 3 ends

political corruption (also known as "pay-to-play") as a compelling interest.

However, the Citizens United Court criticized bans on corporate contributions because they discriminated based on the type of "speaker." This reasoning also suggests that federal law would disfavor a differentiation in contribution limits based on the "speaker's" identity (individual, corporate, or committee) without some particular basis for those distinctions. Specifically, the "narrowly tailored" prong would require that the City enactment be based on some factual determination that corporate or committee contributions - as opposed to individual contributions of the same amount - are more likely to create "pay-to-play" corruption. The record for this enactment does not contain this level of substantiation for distinct limits.

Contractor Disclosure of Political Contributions
At
City
its May 25, 2022 meeting, the Council also asked that staff prepare a report and Policy requiring that contracts disclose, independent of State reporting requirements, political contributions
months
to City Council candidates made during the 12
preceding a bid or proposal. Receipt of political contributions does not disqualify local officials from making decisions relating to the source of those ····· contrib utions:--However;-State-- andtocal·· -c-ampalgn --reporting -1 aws require lhat political candidates and contributors file certain public disclosure documents in accordance with statutory timelines. These reporting deadlines may pre-date the award of contracts for public works and professional services, so it cannot be guaranteed that the public will be made aware of contractors' contributions Council
to
candidates before those awards.

This Policy requires that contractors submitting bids or proposals to the City include
Councilmembers
with their bid or proposal a current disclosure of any contributions made to in the 12 months preceding their submittal. This will ensure that those disclosures are available to the public at the time of contract award, whether or not statutorily required disclosures have been made during that period. Staff will need to revise the City's contract material to include this disclosure form .

Newspaper Publication of Monetary Contributions
At its meeting of May 25, 2022, Council discussed consideration of the City Clerk preparing a synopsis of Form 460's (Recipient Committee Campaign Statement) Clemente
and Form 496's (Independent Expenditure Report) for publication in the San Times, to notify the public of monetary contributions to each individual candidate.

If Council desires to establish Local Campaign Contribution Limits that vary from the State's default limits, the City Clerk recommends that Council do so through adoption of the below ordinances. If Council wishes to require disclosure of contractor political contributions, the City Clerk recommends that Council adopt Policy and Procedure No. 201-15.
8-16-22 I 1 0B-3
46 Agenda Repo1t Page 4

1. Adopt AN URGENCY ORDINANCE OF THE CITY OF SAN CLEMENTE ADDING SECTION 2.04.100 TO CHAPTER 2.04 (CITY COUNCIL) OF TITLE 2 (ADMINISTRATION AND PERSONNEL) OF THE SAN CLEMENTE

MUNICIPAL CODE RELATING TO LOCAL ELECTION CAMPAIGN
CONTRIBUTION LIMITS AND REGULATIONS, with the incorporation of campaign contribution limits of either $500 or $1,000 per source per election and allowing the CPI increases.

2. Introduce AN ORDINANCE OF THE CITY OF SAN CLEMENTE ADDING SECTION 2.04.100 TO CHAPTER 2.04 (CITY COUNCIL) OF TITLE 2 (ADMINISTRATION AND PERSONNEL) OF THE SAN CLEMENTE

3. Adopt Policy and Procedure No. 201-15 (Disclosure of Political Contributions), effective August 16, 2022.
--- 4·:·· Heterminewnetherornottodirectthe·CityClerkto-publish-a-summary of Form 460's and Form 497's in the San Clemente Times.

Attachments: 1) Draft Urgency Ordinance
2) Draft Conventional Ordinance
3) Draft Campaign Contribution Disclosure Policy
Notification: None.
i:\ch\cityclerk\securelmy word\adminreport-contributionlimits(final).docx 8-16-22 I 1 0B-4
47 ATTACHMENT 1
URGENCY ORDINANCE NO. ---

AN URGENCY ORDINANCE OF THE CITY OF SAN CLEMENTE ADDING SECTION 2.04.100 TO CHAPTER 2.04 (CITY COUNCIL) OF TITLE 2 (ADMINISTRATION AND PERSONNEL) OF THE SAN CLEMENTE

MUNICIPAL CODE RELATING TO LOCAL ELECTION CAMPAIGN

CONTRIBUTION LIMITS AND REGULATIONS
WHEREAS, Assembly Bill No. 571 ("AB 571") imposed a default campaign contribution limit upon cities and counties effective January 1, 2021; and Clemente
WHEREAS, California Government Code Section 85702.5 permits the City of San to act by either ordinance or resolution to establish its own campaign contribution limits that differ from those described in Government Code Sections 85301 and 83124; and
WHEREAS, transparency in local elections regarding financial contributions and influence are important to promoting the election process and to ensure a fair Council election process for all candidates; and
= -· -- --~--- ---- --- ---- --------,- - ... _______ • WHEREAS, with the beginning of the 2022 election cycle there is now an urgent need to take immediate action to enact the campaign finance provisions herein so that they may be effective to govern the November 8, 2022 General Municipal Election; WHEREAS, to protect the public safety, health, and welfare, the City Council may adopt this Urgency Ordinance to set local campaign contribution limitations and require measure
reasonable campaign finance disclosure for City Council elections as an urgency in accordance with Government Code section 3693 7, subdivision (b) by a fourfifths vote of the City Council.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN CLEMENTE DOES ORDAIN AS FOLLOWS:

SECTION 2. CEQA. The City Council finds that the proposed amendments Clemente
to the San
Municipal Code are exempt from the requirements of the California Regulations,
Environmental Quality Act (CEOA) pursuant to Tille 14 of the California Code of Section 15061(b)(3) because it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.

Municipal
SECTION 3. Code Amendment. Section2.04.100 is hereby added to the San Clemente Code to read in full as follows :
8-16-22 / 108-5
48 CHAPTER 2.04 - CITY COUNCIL

2.04.010 - City Council Campaign Finance Limitations and Regulations.

A Intent.

1. "Candidate" means an individual who:
a. is listed on the ballot;
b. who has qualified to have write-in votes on that individual's behalf coLmted by election officials; or
c. who has begun to circulate nominating petitions or authorized others to circulate nominating petitions on the individual's behalf for nomination for or election to any elective City office; or d. who receives a contribution or makes an expenditure or gives consent for any other person to receive a contribution or make an expenditure with a view to bringing about the individual's nomination or election to any elective City office, whether or not the specific elective office for which the candidate will seek nomination or election is known at the time the contribution is received or the expenditure is made and whether or not the candidate has announced the candidacy or filed a declaration of candidacy at such time.
"Candidate" includes any individual running to replace an incumbent City officer who is the subject of a recall election but does not include any person within the meaning of Section 30'1,(b) of the Federal Election Campaign Act of 1971 . An individual who becomes a candidate retains status as a 6 8-16-22 / 108-6
(
(
49 (
candidate until such time as that status is terminated pursuant to the Political Reform Act of 1974 (Government Code Section 84214, or successor statute.

2. "City election" means any general or special election, including a vacancy er recall election held within the City for elective City office or on a City measure.

Each general or special election is a separate election for purposes of this Section.

3. "City measure" means any proposition for the issuance of funding or refunding of bonds of the City, voter approval of loca I taxes or other revenue matters, or any other question or proposition submitted to the voters of the City at any election held throughout the entire City. "City measure'' includes any measure which is submitted to a popular vote at an election by action of the City Council or which is submitted or is intended to be submitted to a popular vote at an election by initiative , referendum, or recall procedure, whether or not it has qualified for the ballot.

4. "Enforcement authority" under this Section, means that special counsel appointed by the City Manager in consultation with the _Ci!y Attorney purn_uant lo ·······--·-•-=-" -... So·b·se•ctio-rr-tlJ,· . · ····---::: ...... _ ......... ______ ······ ... ··---- --------·· .. ·--·•-•--······-·--·-........... -................................ ----···"···-

5. "Person" means any individual or entity, .including without limitation a firm, partnership, joint venture, syndicate, business tru st, company, corporation, association, committee, or any other organization or group of persons acting in concert.

Except as otherwise stated herein, the terms of this Section shall have those definitions provided in the Political Reform Act of 1974 ((Government code Section B100O, et. seq . or in the regulations adopted by the California Fair Political Practices Commission to implement the Act.

C. Campaign Finance Disclosure/Electronic Filing.

1. Each candidate and committee must file campaign statements, statements of economic interest, reports, or other documents in the time and manner required by the Political Reform Act of 1974, as amended (Government Code Section 84100, et seq.). Except as set forth herein, compliance with the requirements of the Act are deemed to be in compliance with this Section.

2. Reportable contributions shall include, without limitation, money paid, loaned, contributed, or otherwise furnished to the candidate or any committee for the use of such candidate or such committee in aid of the candidate's election, or for the qualification, passage, or defeat of any city measure. Said disclosure shall include the name of the contributing person or entity and all other information required to be disclosed by the Political Reform Act of 1974, as amended. 8-16-22 I 10B-7
50 3 All candidates and committees required to file campaign statements, reports, or other documents as referenced herein shall do so for all campaign expenditures made, to aid or oppose, either directly or indirectly, a candidate's election or the qualification and/or passage of any city measure. Reportable expenditures shall include, without limitation, expenditures made by a candidate, candidate-controlled committee, political party or independent expenditure committee.

5. In any instance in which an original campaign statement, report or other document must be filed with the California Secretary of State or Fair Political Practices Commission and a copy of that statement, report or other document is required to be filed with the city clerk, the filer may, but is not required to, fi le the copy electronically,
- ---······•-··----•·············· • • ----- --
6, If the city clerk's electronic system is not capable of accepting a particular type of statement, report or other document, an elected officer, candidate, committee or other person shall file that document with the city clerk in an alternative format
D. Limits on Campaign Contributions

1. No person, other than the candidate, is permitted to make to a candidate or candidate-controlled committee, and no candidate-controlled committee treasurer may solicit or accept, any campaign contribution which will cause the total amount contributed by such person with respect to a single city election to exceed [Insert either Five Hundred Dollars ($500.00) or One Thousand Dollars ($1,000.00).) • This contribution limit shall be reviewed and, if necessary, adjusted in January at two (2) year intervals beginning in 2024 by the City Clerk to reflect annual changes in the Consumer Price Index (CPI) over the previous two (2) year period. The City Clerk shall use the annual percent change in the Consumer Price Index for All Urban Consumers (CPI-U) in the selected local area of Los Angeles - Riverside - Orange County, CA, to determine the appropriate rate of increase, if any. The City Clerk shall compute the adjustment for each year separately, adding the adjustment for each year to the prior year's limit and then rounding the total adjusted amount to the nearest ten dollar ($10.00) increment for the two (2) year period.

2. A candidate for elective office shall have no more than one candidatecontrolled committee and one checking account into which all campaign contributions shall be deposited and out of which all expenditures shall be made. 8-16-22 / 108-8
(
t
51 This paragraph shall not prohibit the establishment of savings accounts, but no qualified campaign expenditures shall be made out of these accounts.

3. A person may not make a contribution for any other person under an assumed name or under the name of any other person.

5. The limit in paragraph (1) shall not apply to contributions made to a committee which is organized solely for the purpose of supporting or opposing the qualification and/or passage of one or more city measures. However, the disclosure requirements for all committees set forth in Subsection (C) shall apply.

6. The limit in paragraph ( 1) shall not apply to contributions made to a ",.,·-committee-whtchis-urgantze-d-·sotelyforthe·pm\Joseof·supportTii"go(Op°fJosi"ff(ftfie ······ •••• recall of an incumbent City officer, but shall apply to all candidates and their controlled committees seeking election to replace the incumbent City officer. The disclosure requirements for all committees set forth in Subsection (C) shall apply.

7. The limit in paragraph (1) shall not apply to political contributions made to and expen.ditures made by an independent expenditure.committee in support of or in opposition to a city measure, or in support of or opposition to the election of a candidate for city office, if the contributions and expenditures were not made at the direction or control of the candidate or his or her controlled committee. However, the disclosure requirements for all committees set forth in Subsection (C) shall apply.

8. The limit in paragraph ( 1) shall not apply to political contributions made prior to the effective date of this Section.

E. Suppliers of goods and services - Disclosure of records required 8-16-22 / 1 0B-9
52 No person who supplies goods or services or both goods and services to a candidate or any committee for use in connection with the campaign of a candidate or for or against a city measure may refuse to divulge or disclose to the enforcement authority that person's record of any expenditures made by the candidate or committee in payment for such goods or services or both.

F. Duties of the City Clerk
In addition to other duties required of the City Clerk under the terms of this Section, the City Clerk must:

2. Determine whether required documents have been filed and, if so, whether· they conform on their face with the requirements of State law and this Section; ········--···-----------

3. Notify promptly all persons and known committees who have failed to file a document in the form and at the time required by State law and this Section;

4. Report apparent violations of this Section and applicable State law to the enforcement authority;

5. Compile and maintain a current list of all statements or parts of statements filed with the city clerk's office pertaining to each candidate and each city measure;

G. Enforcement authority - Duties, complaints, legal actions, investigatory powers.

2. Review of complaints of violation of this Section and crimlnal prosecution thereof may be commenced only by the enforcement authority appointed by the City Man ager. The enforcement authority is authorized to commence and prosecute civil litigation to compel compliance with this Section or to 8-16-22 / 10B-10
f
(
53 3.
enjoin conduct in violation of this Section. Prior to each election, the City Manager, in consultation with the City Attorney, will appoint an enforcement authority for that election. If the appointment of an additional enforcement authority becomes necessary or appropriate, the City Manager, in consultation with the City Attorney, will appoint such additional enforcement authority as may be required . No enforcement or prosecution or action of the enforcement authority is subject to the review or control of the City Council or the City Attorney. The City Council shall appropriate sufficient funds from the City's treasury to retain the services of the enforcement authority and to permit him/her to fully investigate any alleged violations of this Section and, if necessary, to take action to enforce this Section.

Any resident of the City who believes that a violation of this Section has occurred may file a written complaint requesting investigation of such violation by the enforcement authority. The complainant shall file the complaint with the City Clerk under penalty of perjury and include proof that the complainant is a resident of the City. Anonymous or non-resident complaints will not be reviewed and/or investigated. The complaint shall ---
state a full recitation of all facts that are alleged to constitute a violation.__of - - ----t··his···-S1:ction--:--··lf-a'·co mplainFcl oes-notcomplywith·thesenequlremenls:·the··· City Clerk shall return the oo mplaint to the complainant, with an explanation as to why it is insufficient for filing . Within five working days after accepting the complaint for filing, the City Clerk shall forward it to the enforcement authority.

4. The enforcement authority shal I, within thirty (30) calendar days of receiving the complaint, make a determination of whether there is probable cause to believe that a violation occurred. If no probable cause is determined to exist, the complaint shall be dismissed summarily and interestec! parties shall be notified of the dismissal in writing.

5. If the enforcement authority determines there is probable cause to believe that a violation of this Section has occurred, the enforcement authority may refer the matter to the District Attorney for criminal prosecution or may conduct an investigation and commence such administrative, civil or criminal legal action as it deems necessary for the enforcement of this Section . No enforcement, prosecution or legal action by the enforcement authority shall be subject to the review or control of the City Council or City Attorney.

6. The enforcement authority shall not investigate or take any further action regarding any alleged violation which has been referred to the District Attorney or which is already the subject of a complaint filed with the Fair Political Practices Commission. until the investigation of that complaint is complete .
8-16-22 / 1 0B-11
54 7. The enforcement authority has such investigative powers as are necessary for the performance of duties described in this Section and may demand and be furnished records of campaign contributions and expenditures of any person or committee at any time. In the event that production of such records is refused, the enforcement authority may commence litigation to complete such production.

8. The enforcement authority is immune to liability for its enforcement of this Section.

9. Any action alleging violation of this Section must be commenced within two years of the time the alleged violation occurred.

H. Penalties

1. Any person who knowingly or willfully violates any provisions of this Section is guilty of a misdemeanor.

2. If any person is found to have violated Subsection (0), whether by civil, ···············-·· ·-··· . cnmmal or administrative enforcement action, the amount of funds received constituting such violation shall be paid by the candidate or committee that received such funds to the City Manager for deposit into the City's general fund. If any person is found to have violated any other sub-chapter of this Section, the fine imposed in connection with such violation shall be in the amount of $250.00 for the first 30 days after said violation, $500.00 for the next 30 days after said violation and $1,000.00 for any period in excess of 60 days following said violation, and shall be paid to the City Manager for deposit into the City's general fund.

3. If any candidate is convicted of a violation of any provision of this Section by a court of competent jurisdiction, the court shall be authorized, to the maximum extent allowed by State law, to declare the candidate's election void or, if the candidate has already assumed office, to remove the candidate from office and declare such office vacant, to be filled in accordance with applicable State law. The Court shall also be authorized to declare the candidate/officer ineligible to hold any City office, up to the maximum amount of time allowed by State law for the offense.

I. Rules of Construction
This Section will be construed liberally in order to effectuate its purposes. No error, irregularity, informality, neglect or omission of any person in any procedure taken under this Section which does not directly affect the jurisdiction of the City to control campaign contributions and expenditures voids the effect of this Section." SECTION 4. Publication. The City Clerk shall certify to the adoption of this Urgency Ordinance and cause it, or a summary of ii, to be published once within 15 days of 8-16-22 I 10B-12
55 adoption in a newspaper of general circulation printed and published within the City of San Clemente, and shall post a certified copy of this Urgency Ordinance, including the vote for and against the same, in the Office of the City Clerk in accordance with California Government Code, section 36933.

SECTION 7. Effective Date. This Urgency Ordinance shall become effective immediately upon its adoption.

Gene James, Mayor
ATTEST:

Laura Campagnolo, Legislative Administrator

STATE OF CALIFORNIA

COLJNTY OF ORANGE

CITY OF SAN CLEMENTE
)
) ss.
)
I, Laura Campagnolo, Legislative Administrator of the City of San Clemente, California, hereby certify that Urgency Ordinance No. ___ , the reading in full thereof unanimously waived, was duly passed and adopted at a regular meeting of the City Council held on the __ day of _________ , by the following vote:

AYES:

NOES:

ABSENT:
8-16-22 / 10B-13
56 IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Clemente, California, this __ day of ----------~ APPROVED AS TO FORM:

CITY ATTORNEY

LEGISLATIVE ADMINISTRATOR
of the City of San Clemente,
California
\lcMalalchlcltyc•erk lsecure\m y wa rdlcampa igncontribulionordin a nee-urgency .doer. -----···············-······ ... -------- ----------
8-16-22 / 10B-14
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57 ATTACHMENT 2
ORDINANCE NO. __

AN ORDINANCE OF THE CITY OF SAN CLEMENTE ADDING SECTION

2.04.100 TO CHAPTER 2.04 (CITY COUNCIL) OF TITLE 2
(ADMINISTRATION AND PERSONNEL) OF THE SAN CLEMENTE

MUNICIPAL CODE RELATING TO LOCAL ELECTION CAMPAIGN

CONTRIBUTION LIMITS AND REGULATIONS
WHEREAS, Assembly Bill No. 571 ("AB 571") imposed a default campaign contribution limit upon cities and coun ties effective January 1, 2021; and WHEREAS, California Government Code Section 85702.5 permits the City of San Clemente to act by either ordinance or resolution to establish its own campaign contribution limits that differ from those described in Government Code Sections 85301 and 83124; and
WHEREAS, transparency in local elections regarding financial contributions and influence are important to promoting the election process and to ensure a fair Council election process for all candidates; and ----------- --·"······ ········= · - - - - ... -....... •• .... • •. ·····•·•••• ............... . ·······-··-··· ........ --.. --.. --- WHEREAS, with the beginning of the 2022 election cycle it is necessary to enact the campaign finance provisions herein so that they may be effective to govern the November 8, 2022 General Municipal Election; and
WHEREAS, in adopting this Ordinance, is the City Council's intention to promote transparency and ensure a fair election process by setting local campaign contribution limitations and requiring reasonable campaign finance disclosure for City Council elections; and
WHEREAS, any and all other legal prerequisites relating to the adoption of this Ordinance have occurred.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN CLEMENTE DOES ORDAIN AS FOLLOWS:

SECTION 1. Incorporation of Recitals. The recitals above are each incorporated by reference and adopted as findings by the City Council as if fully set forth herein .

SECTION 2. CEQA. The City Council finds that the proposed amendments to the San Clemente Municipal Code are exempt from the requirements of the California Environmental Quality Act (CEQA) pursuant to Title 14 of the California Code of Regulations, Section 15061(b)(3} because it can be seen with certainty that there is no , possibility that the activity in question may have a significant effect on the environment.

SECTION 3. Code Amendment. Section 2.04.100 is hereby added to the San Clemente Municipal Code to read in full as follows:
8·16-22 / 10B·15
58 CHAPTER 2.04 - CITY COUNCIL

2.04.010 - City Council Campaign Finance Limitations and Regulations .

A. Intent
It is the intent of the City Council of the City of San Clemente in enacting this section to place realistic and Constitutionally enforceable limits on the amount which may be contributed to candidates' political campaigns in City elections, for the purpose of preventing potential improper or undue influence over elected officials by campaign contributions, to develop a broader base of political efficacy within the community, to provide full and fair enforcement of all the provisions of this Section, and to encourage the public to participate as candidates in elections by simplifying the local regulations as much as possible in matters adequately regulated by State law. This Sectbn is intended to supplement the Political Reform Act of 1974, as amended and in the event of a conflict between that Act and this Section, that Act shall prevail. This Section is enacted pursuant to Article XI, Section 7 of the Constitution of the State of California, and Section 81013 of the California Government Code.
- --········-·-············---- Definitions.

1. "Candidate" means an individual who:
a. is listed on the ballot;
b. who has qualified to have write-in votes on that individual's behalf counted by election officials; or
c. who has begun to circulate nominating petitions or authorized others to circulate nominating petitions on the individual's behalf for nomination for or election to any elective City office ; or d. who receives a contribution or makes an expend iture or gives consent for any other person to receive a contribution or make an expenditure with a view to bringing about the individual's nomination or election to any elective City office, whether or not the specific elective office for which the candidate will seek nomination or election is known at the time the contribution is received or the expenditure is made and whether or not the candidate has announced the candidacy or filed a declaration of candidacy at such time.
"Candidate" includes any individual running to replace an incumbent City officer who is the subject of a recall election but does not include any person within the meaning of Section 301 (b) of the Federal Election Campaign Act of 1971 . An individual who becomes a candidate retains status as a 8-16-22 I 10B-16
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59 candidate until such time as that status is terminated pursuant to the Political Reform Act of 1974 (Government Code Section 84214, or successor statute.

2. "City election" means any general or special election, including a vacancy or recall election held within the City for elective City office or on a City measure.

Each general or special ele~tion is a separate election for purposes of this Section.

3. "City measure" means any proposition for the issuance of funding or refunding of bonds of the City, \Oter approval of local taxes or other revenue matters, or any other question or proposition submitted to the voters of the City at any election held throughout the entire City. "City measure" includes any measure which is submitted to a popular vote at an election by action of the City Council or which is submitted or is intended to be submitted to a popular vote at an election by initiative, referendum, or recall procedure, whether or not it has qualified for the ballot.

4. "Enforcement authority" under this Section, means that special counsel appointed by the City Manager in consultation with the City Attorney pursuant to ·-subse·ction-(G): ----······· --···

5. "Person" means any individual or entity, including without limitation a firm, partnership, joint venture , syndicate, business trust, company, corporation, association, committee, or any other organization or group of persons acting in concert.

Except as otherwise stated herein, the terms of this Section shall have those definitions provided in the Political Reform Act of 1974 ((Government code Section 81000, et. seq. or in the regulations adopted by the California Fair Political Practices Commission to implement the Act.

C. Campaign Finance Disclosure/Electronic Filing.

1. Each candidate and committee must file campaign statements, statements of economic interest, reports, or other documents in the time and manner required by the Political Reform Act of 1974, as amended (Government Code Section 84100, et seq.). Except as set forth herein, compliance with the requirements of the Act are deemed to be in compliance with this Section.

2. Reportable contributions shall Include, without limitation, money paid, loaned, contributed, or otherwise furnished to the candidate or any committee for the use of such candidate or such committee in aid of the candidate's election, or for the qualification, passage, or defeat of any city measure. Said disclosure shall include the name of the contributing person or entity and all other information required to be disclosed by the Political Reform Act of 197 4, as amended. 8-16-22 / 108-17
60 3. All candidates and committees required to file campaign statements, reports. or other documents as referenced herein shall do so for all campaign expenditures made, to aid or oppose, either directly or indirectly, a candidate's election or the qualification and/or passage of any city measure. Reportable expenditures shall include, without limitation, expenditures made by a candidate, candidate-controlled committee. political party or independent expenditure committee .

6. If the city clerk's electronic system is not capable of accepting a particular type of statement, report or other document, an elected officer, candidate, committee or other person shall file that document with the city clerk in an alternative format.

D. Limits on Campaign Contributions

1. No person, other than the candidate, is permitted to make to a candidate or candidate-controlled committee, and no candidate-controlled committee treasurer may solicit or accept, any campaign contribution which will cause the total amount contributed by such person with respect to a single city election to exceed [Insert either Five Hundred Dollars ($500.00) or One Thousand Dollars ($1,000.00).] This contribution limit shall be reviewed and, if necessary, adjusted in January at two (2) year intervals beginning in 2024 by the City Clerk to reflect annual changes in the Consumer Price Index (CPI) over the previous two (2) year period. The City Clerk shall use the annual percent change in the Consumer Price Index for All Urban Consumers (CPI-U) in the selected local area of Los Angeles - Riverside - Orange County, CA, to determine the appropriate rate of increase, if any. The City Clerk shall compute the adjustment for each year separately, adding the adjustment for each year to the prior year's limit and then rounding the total adjusted amount to the nearest ten dollar ($10.00) increment for the two (2) year period.

2. A candidate for elective office shall have no more than one candidatecontrolled committee and one checking account into which all campaign contributions shall be deposited and out of which all expenditures shall be made. 8-16-22 I 10B-18
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61 This paragraph shall not prohibit the establishment of savings accounts, but no qualified campaign expenditures shall be made out of these accounts .

3. A person may not make a contribution for any other person under an assumed name or under the name of any other person.

4. The limit in paragraph (1) shall not be deemed to prohibit contributions or loans from a candidate to his/her own candidate-controlled committee in accordance with State law or to limit the amount of his/her own money or property a candidate may contribute, loan to, or expend on behalf of the candidate's own campaign . Contributions by the spouse of a candidate from such spouse's separate property shall be subject to the limit set forth in paragraph (1) .

5. The limit in paragraph (1) shall not apply to contributions made to a committee which is organized solely for the purpose of supporting or opposing the qualification and/or passage of one or more city measures. However, the disclosure requirements for all committees set forth in Subsection (C) shall apply.

6. The limit in paragraph (1) shall not apply to contributions made to a ····committeewhich·is organized ·solely-for··the purpose of supporting·or·opposing·the • recall of an incumbent City officer, but shall apply to all candidates and their controlled committees seeking election to replace the incumbent City officer. The disclosure requirements for all committees set forth in Subsection (C) shall apply.

8. The limit in paragraph { 1) shall not apply to political contributions made prior to the effective date of this Section.

9. If a candidate or the treasurer of a candidate-controlled committee is offered a contribution which would violate this limitation, the candidate or treasurer must refuse the contribution . If, however, a contribution which is in violation of this section is deposited into the campaign trust account, the candidate or treasurer must report in writing within five days of the receipt of the contribution to the City Clerk the facts surrounding such payment or contribution and, to the extent permitted by applicable law, return the contribution.

E. Suppliers of goods and services - Disclosure of records required 8-16-22 I 10B-19
62 No person who supplies goods or services or both goods and services to a candidate or any committee for use in connection with the campaign of a candidate or for or against a city measure may refuse to divulge or disclose to the enforcement authority that person's record of any expenditures made by the candidate or committee in payment for such goods or services or both.

F. Duties of the City Clerk
In addition to other duties required of the City Clerk under the terms of this Section, the City Clerk must:

2. Determine whether required documents have been filed and, if so, whether they conform on their face with the requirements of State law and this Section;

3. Notify promptly all persons and known committees who have failed to file a document in the form and at the time required by State law and this Section;

4. Report apparent violations of this Section and applicab le State law to the enforcement aythority;

5. Compile and maintain a current list of all statements or parts of statements filed with the city clerk's office pertaining to each candidate and each city measure;

G. Enforcement authority - Duties, complaints, legal actions, investigatory powers.

1. The City Attorney must not investigate or prosecute any alleged violation of this Section; but will defend the constitutionality and legality of this Section in any civil proceeding in which the City or the City Council is a party.

2. Review of complaints of violation of this Section and criminal prosecution thereof may be commenced only by the enforcement authority appointed by the City Manager. The enforcement authority is authorized to commence and prosecute civil litigation to compel compliaoce with this Section or to 8-16-22 I 1 0B-20
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63 enjoin conduct
Manager,
in violation of this Section. Prior to each election, the City in consultation with the City Attorney, will appoint an enforcement authority for that election. If the appointment of an additional enforcement authority becomes necessary or appropriate, the City Manager, in consultation with the City Attorney, will appoint such additional enforcement authority as may be required. No enforcement or prosecution or action of the enforcement authority is subject to the review or control of the City Council or the City Attorney. The City Council shall appropriate sufficient funds from the City's treasury to reta.in the services of the enforcement authority and to permit him/her to fully investigate any alleged violations of this Section and, if necessary, to take action to enforce this Section .

3. Any resident of the City who believes that a violation of this Section has occurred may file a written complaint requesting investigation of such violation by the enforcement authority. The complainant shall file the complaint with the City Clerk under penalty of perjury and include proof that the complainant is a resident of the City. Anonymous or non-resident complaints will not be reviewed and /or investigated. The complaint shall -----·········-··-···
state a full recitation of all facts that are alleged to constitute a violation of - -······ •--···--this·Secti0FL :'=-·lf-a··eomplaint00e-s-n0t-·ccmply-with1heseTequirements; the City Clerk shall return the complaint to the complainant, with an explanation as to why it is insufficient for filing. Within five working days after accepting the complaint for filing, th e City Clerk shall forward it to the enforcement authority.

4. Thl;l enforcement authority shall, within thirty (30) calendar days of receiving the complaint. make a determination of whether there is probable cause to believe that a violation occurred. If no probable cause is determined to exist, th e complaint shall be dismissed summari ly and interested parties shall be notified of the dismissal in writing .

6. The enforcement authority shall not investigate or take any further action regarding any alleged violation which has been referred to the District Attorney or which is already the subject of a complaint filed with the Fair Political Practices Commission , until the investigation of that complaint is complete.
8-16-22 I 108-21
64 7. The enforcement authority has such investigative powers as are necessary for the performance of duties described in this Section and may demand and be furnished records of campaign contributions and expenditures of any person or committee at any time. In the event that production of such records is refused, the enforcement authority may commence litigation to complete such production.

8. The enforcement authority is immune to liability for its enforcement of this Section.

9. Any action alleging violation of this Section must be commenced within two years of the time the alleged violation occurred.

H. Penalties

1. Any person who knowingly or willfully violates any provisions of this Section is guilty of a misdemeanor.

2. If any person is found to have violated Subsection (D), whether by civil, • c'f'iminanrr"·admih1sli'a!ive enforcemenf action, the amount of funds received constituting such violation shall be paid by the candidate or committee that received such funds to the City Manager for deposit into the City's general fund . If any person is found to have violated any other sub-chapter of this Section, the fine imposed in connection with such violation shall be in the amount of $250.00 for the first 30 days after said violation, $500.00 for the · next 3 0 days after said violation and $1,000.00 for any period in excess of 60 days following said violation, and shall be paid to the City Manager for deposit into the City's general fund.

3. If any candidate is convicted of a violation of any provision of this Section by a court of competent jurisdiction, the court shall be authorized, to the maximum extent allowed by State law, to declare the candidate's election void or, if the candidate has already assumed office, to remove the candidate from ornce and declare such office vacant, to be filled in accordance with applicable State law. The Court shall also be authorized to declare the candidate/officer ineligible to hold any City office, up to the maximum amount of time allowed by State law for the offense.

I. Rules of Construction
This Section will be construed liberally in order to effectuate its purposes . No error, irregularity, informality, neglect or omission of any person in any procedure taken under this Sedan which does not directly affect the jurisdiction of the City to control campaign contributions and expenditures voids the effect of this Section." SECTION 4. Publication. The City Clerk shall certify to the adoption of this Ordinance and cause it, or a summary of it, to be published once within 15 days of adoption in a 8-16-22 / 108-22
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65 (
newspaper of general circulation printed and published within the City of San Clemente, and shall post a certified copy of this Ordinance, including the vote for and against the same, in the Office of the City Clerk in accordance with California Government Code, section 36933.

SECTION 5. Records. The documents and materials associated with this Ordinance that constitute the record of proceedings on which the City Council's findings and determinations are based are located at City Hall, 910 Calle Negocio, San Clemente, CA 92673.

SECTION
person

6. Severability. If any provision of this Ordinance or its application to any or circumstance is held invalid, such invalidity has no effect on the other provisions or applications of the Ordinance that can be given effect without the invalid provision or application, and to this extent, the provisions of this ordinance are severable. The City Council declares that it would have adopted this Ordinance irrespective of the invalidity of any portion thereof.

SECTION 7. Effective Date. This Ordinance shall become effective 30 days after its adoption.

APPRQVEO AND ADGPTE8 this·==day·of ==::=, 2022:-·
Gene James, Mayor

STATE OF CALIFORNIA
COUNTY OF ORANGE ss.

CITY OF SAN CLEMENTE
California
I, Laura Campagnolo, Legislative Administrator of the City of San Clemente, , hereby certify that Ordinance No. ___ having been regularly introduced at the meeting of __________ , was again introduced, the reading in full thereof unanimously waived, and duly passed and adopted at a regular meeting of the City Council held on the __ day of __________ , and said ordinance was adopted by the following vote:

AYES:

NOES:

ABSENT:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Clemente, California, this __ day of
8-16-22 I 108-23
66 APPROVED AS TO FORM:

CITY ATTORNEY
\\c~dala\chlcilyclerlllsecure\my v,ord\campaignordinance.docx

LEGISLATIVE ADMIN ISTRATOR
of the City of San Clemente,
California
---------------------------- -- -- __________ ,., ____ ., ------------ . -------------- ---------------- 8-16-22 / 1 0B-24
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67 ATTACHMHl1 3

POLICY AND PROCEDURE
Disclosure of Political Co~. Index: Subject:
-···-· ... ,. ~--'- ...... , ... ---=
cTiy'council
Number: 201-15
Effective Date: August 16, 2022 Prepared by: City Attorney Approved by.

I - - -- - -~. - . - -

1.0 PURPOSE:

Receipt of political contributions does not disqualify local officials from ma king decisions relating to the source of those contributions. However, State and local campaign reporting laws require that political candidates and contributors certain
file
public disclosure documents in accordance with statutory timelines. These ---professional
reporting deadlines
services,
may
so
pre-date the award of contracts for _public works .... and ......... __ ... . .. ----- --· ·- _ it cannot be guaranteed
aware
that the public will be made
of contractors' contributions to Council candidates before those awards.

This Policy requires that contractors submitting bids or proposals to the City include
Councilmembers
with that bid or proposal a current disclosure of any contributions made to in the 12 m onths preceding that submittal. This will ensure that those disclosures are available to the public at the time of contract award, whether or not statutorily required disclosures have been made during that period.

2.0 ORGANIZATIONS AFFECTED:

All departments and con tractors

3.0 POLICY:
disclosure
All bids or proposals for services submitted to the City shall include a written to the City declaring any political contributions of money, in-kind preceding
services, or loans made lo any member of the City Council within the 12 months the submittal. Contractors shall submit the disclosure prior to the contract being approved, renewed or extended by the City. 4,0 PROCEDURE:

It shall be the responsibility of staff drafting requests for bids or proposals to include in said request a disclosure statement form in substantially the form attached hereto. Said disclosure form shall be available for public inspection prior to contract award, renewal or extension of the contract or shall be contained in the rn;1.02100.,1,1,ei ;60.2
8-16-22 / 108-25
68 recommendation for such action when presented to the City Council. Bids or proposals lacking said disclosure shall be deemed incomplete.

CITY OF SAN CLEMENTE

To the best of my knowledge, I declare under penalty of perjury that the foregoing is true and was executed at:

City/County/State Date
Name of Contractor Print Name
Signature
NOTE: THIS DECLARATION rs INCLUDED AS PART OF THE AGREEMENT AND MUST BE SIGNED AND ATTACHED HERETO.
1 554'2.0~2C0\J~•ISJ566.1
8-16-22 I 10B-26
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_C_it_y_C_o_u_n_ci_l _M_i_n_ut_e_s_-_S_p_e_ci_a_l _M_e_e_t_in_g_o_f_J_an_u_a_r..;_y_S_, _2_01_o _________ P_a-=g~e_2_s (~)

10. NEW BUSINESS
A. Campaign Contribution Limitations
Report from the City Attorney concerning the issue of potential campaign contribution limitations.

City Attorney Oderman reviewed the Administrative Report and responded to Council inquiries.

Larry Culbertson, San Clemente, opined that campaign contribution limits should be implemented in San Clemente; asserted that excessive campaign contributions may have the appearance of impropriety; opined that only individual persons should be permitted to contribute to campaigns.

John Alpay, San Clemente, speaking as a private citizen, spoke in support of campaign contribution limits; suggested that Council limit campaign contributions to $2,400 per contributor; opined that excessive campaign donations may lead to political corruption. In response to Council inquiries, Mr.

Alpay related that during his review of the 2008 campaign contribution reports, he did not observe any abnormalities or excessive contributions; advised that the proposal would not limit the amount that a candidate could contribute to his/her own campaign.

Bill Hart. San Clemente, speaking as a private citizen, voiced support for campaign contribution limits; opined that campaign contribution limits should be based on an election cycle; asserted that large campaign contributions provide for the impression of impropriety.

In response to Council inquiry, City Clerk Baade explained that candidates and Political Action Committees must submit campaign disclosure reports twice per year and must also file pre-election reports if they are involved in election activity; related that the subject reports identify contribution sources as well as information related to campaign expenditures; stated that campaign disclosure reports are available for public inspection and duplication.

MOTION BY COUNCILMEMBER EGGLESTON, SECOND BY COUNCILMEMBER ANDERSON, CARRIED 5-0, to not pursue a limitation on campaign contributions. 70 r
'
' ,RUTAN Rutan & Tucker, LLP 611 Anton Blvd .. Suite 1400 PO Box 1950

ORANGE COUNTY

PALO ALTO
Costa Mesa, CA 92628-1950 (650) 320-1500
(714) 641-5100 Fax(714)546-9035
www rulan com A PARTNERSHIP INCLUDING PROFESSIONAL CORPORATIONS

MEMORANDUM
TO: Mayor Donchak and Members of the San Clemente City Council FROM: City Attorney Jeffrey M. Oderman
Michael R.W. Houston, Esq.

DATE: December 15, 2009
FILE NO.: 062266-0134
RE: Proposed Model Ordinance Imposing Campaign Contributions Limitations I. Introduction
This memorandum reviews a proposed campaign finance ordinance prepared by Mr. John Al pay that would limit the amount of campaign contributions to candidates for the San Clemente City Council. (Mr. Alpay's proposed ordinance also addresses term limits, which subject the City Council has already addressed and is not further discussed in this memorandum.) II. Recommendation
If the City Council desires to further consider a campaign finance ordinance, then the Council should direct the City Attorney to re-draft Mr. Alpay's proposed ordinance consistent with the recommendations noted below, along with any other items directed by the City Council.

III. Analysis
A. Legal Overview
• Campaign Contributions are Protected by the First Amendment: Campaign contributions are a type of "core" First Amendment speech and are therefore subject to significant protection. Restrictions on campaign contributions are subject to a "rigorous" standard of judicial review. (Nixon v. Shrink Missouri Gov 't PAC (2000) 528 U.S. 377, 87-88.) • Standard for Upholding Restrictions on Contributions: Campaign contribution restrictions are constitutional only if the government agency demonstrates a sufficiently important interest and employs means closely drawn to avoid unnecessary abridgement of associational freedoms. (Buckley v. Valeo (1976) 424 U.S. l , 25.) 2156/062266·0134
1050091.01 al 1/ 12/09
71 Mayor Donchak and Members of the San
Clemente City Council
December 15, 2009

Page 2 ends

San Clemente City CouncilFebruary 6, 2024

San Clemente City Council
February 6, 2024