San Clemente City Council
August 20, 2024

Attachment 2
280
Date:

Quotation # San Clemente, City of 06122024
6/12/2024
11909 Tech Center Ct.

Poway, CA 92064
Phone: 949.467.4758
Fax: 858.391.5958
Prices quoted are for this project only and do not include sales or use taxes, if any. Quoted prices are based upon receipt of the total quantity for immediate shipment or shipments within thirty (30) days of a bid opening only, and are offered contingent upon the Buyer's acceptance of Seller's terms and conditions. Seller objects to all terms and conditions. Future shipments subject to price changes. Seller not responsible for delays caused beyond our control. Purchaser's sole warranties, if any, are those provided by the manufacturer. SELLER DISCLAIMS ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING ALL IMPLIED WARRANTIES OF MERCHANT ABILITY OR FITNESS OR FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT WILL

SELLER BE LIABLE FOR ANY INCIDENTAL, PUNITIVE, SPECIAL OR CONSEQUENTIAL DAMAGES ARISING DIRECTLY OR INDIRECTLY FROM THE OPERATION OR USE OF THE PRODUCT. SELLER'S LIABILITY, IF ANY, SHALL BE LIMITED TO THE NET SALES PRICE RECEIVED BY SELLER. All returns are subject to Ferguson and/or Manufacutures return policy and maybe subject to a restocking fee. Complete terms and conditions are available upon request or can be view at www.ferguson.com/sales-terms.html

Company 5665 Airport Blvd Purchase Order
#:

Address: Boulder, Colorado 80301 Quote Number: Q-01918
United States Created Date: 06/12/2024
Expiration Date: 07/01/2025
Prepared By: Dustin Rivas
Email: [email protected]
Bill To
Name: San Clemente Ship To Name: San Clemente
Bill To: 390 E Avenida Pico Ship To: 390 E Avenida Pico BLDG N San Clemente, California 92672 San Clemente, California 92672 United States United States
Quote To: Additional To:
,
Quantity Product Line Item Description Sales Price Total Price 1 Altair 5/8x3/4 7.5"
LL
This package contains the following
products:

Altair 5/8x3/4 7.5" LL
Innov8 Basic
3W leads
$195.00}
$195.00
1 Spectrum 30DB
5/8x3/4 Brass
This package contains the following
products:

Spectrum 30DB 5/8x3/4 Brass
Innov8 Basic
3W leads
$205.00}
$205.00
1 Spectrum 50DL 1"

10.75" LL
This package contains the following
products:

Spectrum 50DL 1" 10.75" LL
Innov8 Basic
3W leads
$335.00}
$335.00
1 Spectrum 88DL

1.5" 13" LL
This package contains the following
products:

Spectrum 88DL 1.5" 13" LL
$575.00}
$575.00
Attachment 3
282
Innov8 Basic
3W leads
1 Spectrum 130D 2"
10" LL
This package contains the following
products:

Spectrum 130D 2" 10" LL
Innov8 Basic
3W leads
$950.00}
$950.00
1 Spectrum 175D 3"
12" LL
This package contains the following
products:

Spectrum 175D 3" 12" LL
Innov8 Basic
3W leads
$1,675.00}
$1,675.00
1 Spectrum 500D 3"
This package contains the following
products:

Spectrum 500D 3"
Innov8 Basic
3W leads
$2,095.00}
$2,095.00
1 Spectrum 500D 4"
This package contains the following
products:

Spectrum 500D 4"
Innov8 Basic
3W leads
$2,595.00}
$2,595.00
1 Spectrum 1000D
4"
This package contains the following
products:

Spectrum 1000D 4"
Innov8 Basic
3W leads
$3,295.00}
$3,295.00
1 Spectrum 1000D
6"
This package contains the following
products:

Spectrum 1000D 6"
Innov8 Basic
3W leads
$3,995.00}
$3,995.00
1 Enduro 2800D 6"
This package contains the following
products:

Enduro 2800D 6"
Innov8 Basic
$5,500.00}
$5,500.00
283
3W leads
1 Enduro 2800D 8"
This package contains the following
products:

Enduro 2800D 8"
Innov8 Basic
3W leads
$5,895.00}
$5,895.00
1 Voyager Hydrant
Meter 3"
This package contains the following
products:

Voyager Hydrant Meter 3"
Innov8-VN
Antenna Stubby 4G
$1,650.00}
$1,650.00
1 Cellular
Connectivity
Hydrant
3 Year Verizon Annual Service Plan
Hydrant $0.00}
$0.00
Residential Programming: 100 Cubic Feet
Commercial Programming: 100 Cubic Feet
Description:

Terms and Conditions:
• FOB Boulder, CO
• Payment net 30 days from date of shipment
• All Non-Stock/Custom product sales are non-returnable and non-refundable 284

Statutory Exemptions. State code number:

_______________________________________________
Notice of Exemption Appendix E
To: Office of Planning and Research From: (Public Agency): ____________________________ P.O. Box 3044, Room 113 _______________________________________________ Sacramento, CA 95812-3044 County Clerk
(Address)
___________________________
___________________________
County of: __________________
Project Title: ____________________________________________________________________________ Project Applicant: ________________________________________________________________________ Project Location - Specific:

Project Location - City: ______________________ Project Location - County:

Description of Nature, Purpose and Beneficiaries of Project:
_____________________
Name of Public Agency Approving Project: _____________________________________________________ Name of Person or Agency Carrying Out Project: ________________________________________________ Exempt Status: (check one):

Ministerial (Sec. 21080(b)(1); 15268);
Declared Emergency (Sec. 21080(b)(3); 15269(a));
Emergency Project (Sec. 21080(b)(4); 15269(b)(c));
Reasons why project is exempt:

Lead Agency
Contact Person: ____________________________ Area Code/Telephone/Extension: _______________ If filed by applicant:

1. Attach certified document of exemption finding.

2. Has a Notice of Exemption been filed by the public agency approving the project? Yes No Signature: ____________________________ Date:

Signed by Lead Agency Signed by Applicant
Authority cited: Sections 21083 and 21110, Public Resources Code. Date Received for filing at OPR:

Reference: Sections 21108, 21152, and 21152.1, Public Resources Code. _______________
Categorical Exemption. State type and section number: ____________________________________ ______________________________________________
______________ Title: _______________________
Revised 2011
Attachment 4
285
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 1
Meeting Date: August 20, 2024 Agenda Item: 11G.

Submitted By: Public Works
Prepared By: Fatana Temory, Management Analyst
Subject:
..titl e
CONSIDERATION OF A RESOLUTION AWARDING A CONTRACT TO CABCO YELLOW, INC.

FOR SENIOR MOBILITY PROGRAM TRANSPORTATION SERVICES, AUTHORIZING THE

CITY MANAGER TO EXECUTE THE CONTRACT, AND FINDING THE PROJECT CATEGORICALLY ..body EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL QUALITY ACT Fiscal Impact:

The services for the Senior Mobility Program (SMP) will be funded from the City’s Senior Mobility Fund. The fund balance is approximately $402,000 and OCTA funds 80% of this program. The estimated cost is $100,000 a year, which is in the current budget.

The proposed contract with Cabco Yellow, Inc. dba California Yellow Cab (CYC) is for three years in an amount not to exceed $300,000 ($100,000 per year) for the Senior Mobility Program transportation services with two optional one-year extensions not to exceed $100,000 per year, exercisable at the City Manager’s discretion.

Summary:

Before the City Council is Resolution No. 24-132 awarding a Professional Services Agreement to CYC for Senior Mobility Program Transportation Services, authorizing the City Manager to execute a three-year contract in an amount not to exceed City expenditures of $300,000, with two optional one-year extensions not to exceed City expenditures of $100,000 per year, exercisable in the City Manager’s discretion, and finding the project categorically exempt from the California Environmental Quality Act (CEQA) under Class 1. As noted, OCTA provides the remaining funding, equal to 80% of the total cost.

Background:

The purpose of the Senior Mobility Program is to provide a safe fixed-route transportation option to help senior residents lead independent lives while encouraging accessibility and enhancing their connection with our community. Orange County Transportation Authority’s (OCTA’s) mission is to fill the gap between local fixed-route buses and ADA paratransit by providing local transportation services to seniors in participating cities in Orange County. Under the program, participating cities are eligible to receive funds from OCTA to help operate a transit program that fits the needs of seniors in their communities.

Since 2002, the City of San Clemente has provided senior transportation services through the Senior Mobility Program. The City’s program is a no-cost transportation system that provides seniors, age 60 and over, who reside in the City with transportation to a list of pre-approved locations. Senior Mobility Program services are currently provided by CYC. The funding for the 286
Meeting Date: August 20, 2024 Agenda Item: 11G.

CITY OF SAN CLEMENTE 2
program is made available through OCTA’s Senior Mobility Program. OCTA funds 80% of the program expenses and the City of San Clemente funds the remaining 20% balance.

The current contract with CYC is set to expire on August 18, 2024. Pursuant to City Policy 201-2- 3, Staff conducted a Request For Proposals (RFP) for Senior Mobility Program Transportation Services on July 25, 2024 through PlanetBids and attempt to find local vendors who may be interested in performing the services. The RFP sought qualified transportation service contractors to provide senior mobility transportation services for a period of three years commencing August 20, 2024, with the option, at the City's sole discretion, to award two additional years upon successful demonstration of exemplary contract performance.

On August 7, 2024, the City received a proposal from one (1) vendor: California Yellow Cab (CYC). After careful evaluation, Staff found CYC demonstrated superior knowledge in the program and working alongside OCTA to provide accurate data analysis required for Senior Mobility Program reporting. In addition, CYC is currently the provider for the surrounding Orange County senior mobility programs including Mission Viejo, Aliso Viejo, Laguna Hills, Laguna Woods, Laguna Niguel, Orange, Garden Grove and more. Staff’s recommendation is based on a combination of various factors including technical expertise, methodology and work plan, project experience, CYC staff qualifications, delivery schedule, quality control, local knowledge and cost.

Staff recommends that the contract be awarded to CYC.

Council Options:
 Adopt Resolution No. 24-132, which would award a Professional Services Agreement to California Yellow Cab Senior Mobility Program Transportation Services, authorize the City Manager to execute a three-year contract in an amount not to exceed $300,000, with two optional one-year extensions not to exceed $100,000 per year, exercisable in the City Manager’s discretion, and find the project categorically exempt from CEQA under Class 1.  Modify and adopt Resolution No. 24-132.
 Continue the Item and provide Staff with alternative direction.  Do not approve the Professional Services Agreements with CYC for the Senior Mobility Program Transportation Services. Note: The current contract expires August 18, 2024. This would result in the City disrupting the Senior Mobility Program.

Environmental Review/Analysis:

Staff recommends that the City Council determine this project to be categorically exempt from the California Environmental Quality Act (CEQA) under Class 1 (Existing Facilities, 14 CCR Section 15301).

Recommended Actions:

Staff Recommendation ..recommendation
Staff recommends that the City Council adopt Resolution No. 24-132, which would:
..recommendation
287
Meeting Date: August 20, 2024 Agenda Item: 11G.

CITY OF SAN CLEMENTE 3

1. Award a Professional Services Agreement to Cabco Yellow, Inc. dba California Yellow Cab (CYC);

2. Authorize the City Manager to execute a three-year contract in an amount not to exceed $300,000, with two optional one-year extensions not to exceed $100,000 per year, exercisable in the City Manager’s discretion; and

3. Find the project categorically exempt from CEQA under Class 1 of the state CEQA Guidelines (Existing Facilities, 14 CCR Section 15301).
..end
Attachment:

1. Resolution No. 24-132

2. CYC Professional Services Agreement

3. CYC Proposal
Notification:

Cabco Yellow, Inc. dba California Yellow Cab
288
ATTACHMENT 1
4860-5047-5367 v1
RESOLUTION NO. 24-132

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SAN CLEMENTE, CALIFORNIA, AWARDING A

PROFESSIONAL SERVICES AGREEMENT TO CABCO
YELLOW, INC. FOR SENIOR MOBILITY PROGRAM
TRANSPORTATION SERVICES; AUTHORIZING THE CITY
MANAGER TO EXECUTE THE CONTRACT; AND FINDING

THE PROJECT CATEGORICALLY EXEMPT FROM THE

CALIFORNIA ENVIRONMENTAL QUALITY ACT UNDER
CLASS 1 (EXISTING FACILITIES, 14 CCR 15301)
WHEREAS, the City wishes to continue providing senior transportation services to help fill the gap between local fixed-route buses and ADA paratransit; and WHEREAS, the professional on-demand transportation services under contract with Cabco Yellow, Inc. expired on August 18, 2024; and WHEREAS, the City of San Clemente released a Request For Proposals for Senior Mobility Program Transportation Services and Cabco Yellow, Inc. was the only proposer; and
WHEREAS, Cabco Yellow, Inc. is qualified to perform the services and its prices are fair and reasonable.

NOW, THEREFORE, the City Council of the City of San Clemente does hereby find, determine and resolve as follows:

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

SECTION 2. That based on a review of substantial evidence in the record as a whole, this project is determined to be categorically exempt from the California Environmental Quality Act (CEQA) under Class 1 of the state CEQA Guidelines section 15301 (Existing Facilities, 14 CCR 15301) because it continues an existing program and consists of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or former use, and there is no possibility of a direct or foreseeable indirect substantial impact on the environment.

SECTION 3. That a Professional Services Agreement is awarded to Cabco Yellow, Inc. for Senior Mobility Program Transportation Services. 289
Resolution No. 24-132 Page 2
SECTION 4. That the City Manager is authorized to execute a three-year contract with Cabco Yellow, Inc. in a form substantially similar to that present to City Council on August 20, 2024, in an amount not to exceed $300,000, with two optional one-year extensions not to exceed $100,000 per year, exercisable in the City Manager’s discretion.

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 _____ day of August, 2024.
_______________________
Mayor of the City of
San Clemente, California
ATTEST:
__________________________
CITY CLERK of the City of
San Clemente, California
290
Resolution No. 24-132 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. 24-132 was adopted at a regular meeting of the City Council of the City of San Clemente held on _______ day of August, 2024, by the following vote:

AYES:

NOES:

ABSENT:
_______________________
CITY CLERK of the City of
San Clemente, California
Approved as to form:
____________________________
Elizabeth A. Mitchell, City Attorney
291
Attachment 2

CITY OF SAN CLEMENTE

PROFESSIONAL CONSULTANT SERVICES AGREEMENT

1. PARTIES AND DATE.

This Agreement is made and entered into this _____ day of ________, 20___, by and between the City of San Clemente, a municipal corporation, organized under the laws of the State of California, with its principal place of business at 910 Calle Negocio , San Clemente, California, 92673 ("City") and Cabco Yellow Inc. dba California Yellow Cab (CYC) with its principal place of business at 520 West Dyer Road, Santa Ana, California 92707 ("Consultant"). City and Consultant are sometimes individually referred to herein as "Party" and collectively as "Parties."

2. RECITALS.

2.1 Consultant.

Consultant desires to perform and assume responsibility for the provision of certain professional senior mobility program transportation services required by the City on the terms and conditions set forth in this Agreement. Consultant represents that it is experienced in providing professional senior mobility program transportation services to public clients, is licensed in the State of California, if applicable, and is familiar with the plans of City.

2.2 Project.

City desires to engage Consultant to render such professional senior mobility program transportation services for the Senior Mobility Program project ("Project") as set forth in this Agreement.

3. TERMS.

3.1 Scope of Services and Term.

3.1.1 General Scope of Services. Consultant promises and agrees to furnish to the City all labor, materials, tools, equipment, services, and incidental and customary work necessary to fully and adequately supply the professional senior mobility program transportation services necessary for the Project ("Services"). The Services are more particularly described in Exhibit "A" attached hereto and incorporated herein by reference. All Services shall be subject to, and performed in accordance with, this Agreement, the exhibits attached hereto and incorporated herein by reference, and all applicable local, state and federal laws, rules and regulations.

3.1.2 Term. The term of this Agreement shall be from August 19, 2024 to August 18, 2027, unless earlier terminated as provided herein. The City Manager shall have the unilateral option, at his/her sole discretion, to renew this Agreement automatically for no more than two additional one-year terms. Consultant shall complete the Services within the term of this Agreement, and shall meet any other established schedules and deadlines.

3.2 Responsibilities of Consultant.

3.2.1 Independent Contractor; Control and Payment of Subordinates. The Services shall be performed by Consultant or under its supervision. Consultant will determine the means, methods and details of performing the Services subject to the requirements of this 292
2 55452.01100\31193624.5
Agreement. City retains Consultant on an independent contractor basis and not as an employee.

Consultant retains the right to perform similar or different services for others during the term of this Agreement. Any additional personnel performing the Services under this Agreement on behalf of Consultant shall also not be employees of City and shall at all times be under Consultant's exclusive direction and control, the City being only concerned with the finished results of the work being performed. Neither City, nor any of its officials, officers, directors, employees or agents shall have control over the conduct of Consultant or any of Consultant's officers, employees, or agents, except as set forth in this Agreement. Consultant shall pay all wages, salaries, and other amounts due such personnel in connection with their performance of Services under this Agreement and as required by law. Consultant shall be solely responsible for all reports and obligations respecting such additional personnel, including, but not limited to: social security taxes, income tax withholding, unemployment insurance, disability insurance, and workers' compensation insurance. Neither Consultant nor Consultant's employees shall in any event be entitled to any benefits to which City employees are entitled, including, but not limited to, overtime, retirement benefits, workers’ compensation benefits, injury leave or other leave benefits. Consultant is solely responsible for all such matters, as well as compliance with social security and income tax withholding and all other regulations and laws governing such matters.

3.2.2 PERS Eligibility and Employee Payments Indemnification. In the event that Consultant's employee providing services under this Agreement claims or is determined by a court of competent jurisdiction or the California Public Employees Retirement System (PERS) to be eligible for enrollment in PERS of the City, Consultant shall indemnify, defend, and hold harmless City for the payment of any employer and employee contributions for PERS benefits on behalf of the employee as well as for payment of any penalties and interest on such contributions that would otherwise be the responsibility of the City. Notwithstanding any other agency, state or federal policy, rule, regulation, law or ordinance to the contrary, Consultant's employees providing service under this Agreement shall not qualify for or become entitled to, and hereby agree to waive any claims to, any compensation and benefit including but not limited to eligibility to enroll in PERS as an employee of City and entitlement to any contributions to be paid by City for employer contributions and/or employee contributions for PERS benefits. Consultant agrees to defend and indemnify the City for any obligation, claim, suit or demand for tax, retirement contribution including any contribution to the PERS, social security, salary or wages, overtime payment, or workers’ compensation payment that the City may be required to make for work done under this Agreement. The provisions of this section 3.2.2 are continuing obligations that shall survive expiration or termination of this Agreement.

3.2.3 Schedule of Services. Consultant shall perform the Services expeditiously, within the term of this Agreement, and in accordance with the Schedule of Services set forth in Exhibit "B" attached hereto and incorporated herein by reference. Consultant represents that it has the professional and technical personnel required to perform the Services in conformance with such conditions. In order to facilitate Consultant's conformance with the Schedule, City shall respond to Consultant's submittals in a timely manner. Upon request of City, Consultant shall provide a more detailed schedule of anticipated performance to meet the Schedule of Services.

3.2.4 Endorsement on PS&E/ Other Data. Consultant shall sign all plans, specifications, estimates (PS&E) and engineering data furnished by Consultant, and where appropriate will indicate Consultant’s authorized signature and professional registration number.

3.2.5 Conformance to Applicable Requirements. All work prepared by Consultant shall be subject to the approval of City.

3.2.6 Substitution of Key Personnel. Consultant has represented to City that 293
3 55452.01100\31193624.5
certain key personnel will perform and coordinate the Services under this Agreement. Should one or more of such personnel become unavailable, Consultant may substitute other personnel of at least equal competence upon written approval of City. In the event that City and Consultant cannot agree as to the substitution of key personnel, City shall be entitled to terminate this Agreement for cause. As discussed below, any personnel who fail or refuse to perform the Services in a manner acceptable to the City, or who are determined by the City to be uncooperative, incompetent, a threat to the adequate or timely completion of the Project or a threat to the safety of persons or property, shall be promptly removed from the Project by the Consultant at the request of the City. The key personnel for performance of this Agreement are as follows: Akbar Majid, President.

3.2.7 City's Representative. The City hereby designates David Rebensdorf, or his/her designee, to act as its representative in all matters pertaining to the administration and performance of this Agreement ("City's Representative"). City's Representative shall have the power to act on behalf of the City for review and approval of all products submitted by Consultant but not the authority to enlarge the Scope of Work or change the total compensation due to Consultant under this Agreement. The City Manager shall be authorized to act on City's behalf and to execute all necessary documents which enlarge the Scope of Work or change the Consultant's total compensation subject to the provisions contained in Section 3.3 of this Agreement. Consultant shall not accept direction or orders from any person other than the City Manager, City's Representative or his/her designee.

3.2.8 Consultant's Representative. Consultant hereby designates Akbar Majid, President, or his/her designee, to act as its representative for the performance of this Agreement ("Consultant's Representative"). Consultant's Representative shall have full authority to represent and act on behalf of the Consultant for all purposes under this Agreement. The Consultant's Representative shall supervise and direct the Services, using his/her best skill and attention, and shall be responsible for all means, methods, techniques, sequences, and procedures and for the satisfactory coordination of all portions of the Services under this Agreement.

3.2.9 Coordination of Services. Consultant agrees to work closely with City staff in the performance of Services and shall be available to City's staff, consultants and other staff at all reasonable times.

3.2.10 Standard of Care; Performance of Employees. Consultant shall perform all Services under this Agreement in a skillful and competent manner, consistent with the standards generally recognized as being employed by professionals in the same discipline in the State of California. Consultant represents and maintains that it is skilled in the professional calling necessary to perform the Services. Consultant warrants that all employees and subconsultants shall have sufficient skill and experience to perform the Services assigned to them. Finally, Consultant represents that it, its employees and subconsultants have all licenses, permits, qualifications and approvals of whatever nature that are legally required to perform the Services, and that such licenses and approvals shall be maintained throughout the term of this Agreement.

As provided for in the indemnification provisions of this Agreement, Consultant shall perform, at its own cost and expense and without reimbursement from the City, any services necessary to correct errors or omissions which are caused by the Consultant's failure to comply with the standard of care provided for herein. Any employee of the Consultant or its sub-consultants who is determined by the City to be uncooperative, incompetent, a threat to the adequate or timely completion of the Project, a threat to the safety of persons or property, or any employee who fails or refuses to perform the Services in a manner acceptable to the City, shall be promptly removed from the Project by the Consultant and shall not be re-employed to perform any of the Services or to work on the Project.
294
4 55452.01100\31193624.5

3.2.11 Laws and Regulations. Consultant shall keep itself fully informed of and in compliance with all local, state and federal laws, rules and regulations in any manner affecting the performance of the Project or the Services, including all Cal/OSHA requirements, and shall give all notices required by law. Consultant shall be liable for all violations of such laws and regulations in connection with Services. If Consultant performs any work knowing it to be contrary to such laws, rules and regulations, Consultant shall be solely responsible for all costs arising therefrom. Consultant shall defend, indemnify and hold City, its officials, directors, officers, employees, agents, and volunteers free and harmless, pursuant to the indemnification provisions of this Agreement, from any claim or liability arising out of any failure or alleged failure to comply with such laws, rules or regulations.

3.2.12 Safety. Consultant shall execute and maintain its work so as to avoid injury or damage to any person or property. In carrying out its Services, the Consultant shall at all times be in compliance with all applicable local, state and federal laws, rules and regulations, and shall exercise all necessary precautions for the safety of employees appropriate to the nature of the work and the conditions under which the work is to be performed. Safety precautions, where applicable, shall include, but shall not be limited to: (A) adequate life protection and lifesaving equipment and procedures; (B) instructions in accident prevention for all employees and subconsultants, such as safe walkways, scaffolds, fall protection ladders, bridges, gang planks, confined space procedures, trenching and shoring, equipment and other safety devices, equipment and wearing apparel as are necessary or lawfully required to prevent accidents or injuries; and (C) adequate facilities for the proper inspection and maintenance of all safety measures.

3.2.13 Insurance. Consultant agrees to procure and maintain, at Consultant’s expense all insurance specified in Exhibit “C” attached hereto and by this reference incorporated herein. Consultant shall require all subconsultants to carry the same policies and limits of insurance that the Consultant is required to maintain, unless otherwise approved in writing by the City.

3.3 Fees and Payments.

3.3.1 Compensation. Consultant shall receive compensation, including authorized reimbursements, for all Services rendered under this Agreement at the rates set forth in Exhibit "D" attached hereto and incorporated herein by reference. The total compensation shall not exceed THREE HUNDRED THOUSAND DOLLARS ($300,000) for the initial three-year term and shall not exceed ONE HUNDRED THOUSAND DOLLARS ($100,000) per year for any optional extended term without prior written approval of the City Council or City Manager as applicable. Extra Work may be authorized, as described below, and if authorized, will be compensated at the rates and manner set forth in this Agreement.

3.3.2 Payment of Compensation. Consultant shall submit to City a monthly invoice which indicates work completed and hours of Services rendered by Consultant. The invoice shall describe the amount of Services provided since the initial commencement date, or since the start of the subsequent billing periods, as appropriate, through the date of the invoice.

City shall, within 30 days of receiving such invoice, review the invoice and pay all non-disputed and approved charges thereon. If the City disputes any of Consultant's fees, the City shall give written notice to Consultant within thirty (30) days of receipt of an invoice of any disputed fees set forth therein.

3.3.3 Reimbursement for Expenses. Consultant shall not be reimbursed for any expenses unless authorized in writing by City, or included in Exhibit "D" of this Agreement. 295
5 55452.01100\31193624.5

3.3.4 Extra Work. At any time during the term of this Agreement, City may request that Consultant perform Extra Work. As used herein, "Extra Work" means any work which is determined by City to be necessary for the proper completion of the Project, but which the Parties did not reasonably anticipate would be necessary at the execution of this Agreement.

Consultant shall not perform, nor be compensated for, Extra Work without written authorization from the City.

3.3.5 Rate Increases. In the event that this Agreement is renewed pursuant to Section 3.1.2, the rate set forth in Exhibit “D” may be adjusted each year at the time of renewal as set forth in Exhibit “D.”

3.3.6 Labor Code Requirements.

3.3.6.1 Prevailing Wages. Consultant is aware of the requirements of California Labor Code Section 1720, et seq., and 1770, et seq., as well as California Code of Regulations, Title 8, Section 16000, et seq., ("Prevailing Wage Laws"), which require the payment of prevailing wage rates and the performance of other requirements on "public works" and "maintenance" projects. If the Services are being performed as part of an applicable "public works" or "maintenance" project, as defined by the Prevailing Wage Laws, and if the total compensation is $1,000 or more, Consultant agrees to fully comply with such Prevailing Wage Laws. Consultant shall make copies of the prevailing rates of per diem wages for each craft, classification or type of worker needed to execute the Services available to interested parties upon request, and shall post copies at the Consultant's principal place of business and at the project site. Consultant shall defend, indemnify and hold the City, its officials, officers, employees, agents, and volunteers free and harmless from any claim or liability arising out of any failure or alleged failure to comply with the Prevailing Wage Laws.

3.3.6.2 Registration. If the Services are being performed as part of an applicable “public works” or “maintenance” project, in addition to the foregoing, then pursuant to Labor Code sections 1725.5 and 1771.1, the Consultant and all subconsultants must be registered with the Department of Industrial Relations (“DIR”). Consultant shall maintain registration for the duration of the project and require the same of any subconsultants. This project may also be subject to compliance monitoring and enforcement by the DIR. It shall be Consultant’s sole responsibility to comply with all applicable registration and labor compliance requirements, including the submission of payroll records directly to the DIR. Notwithstanding the foregoing, the contractor registration requirements mandated by Labor Code sections 1725.5 and 1771.1 shall not apply to Services performed on a public works project that is exempt pursuant to the small project exemption specified in Labor Code sections 1725.5 and 1771.1.

3.4 Accounting Records.

3.4.1 Maintenance and Inspection. Consultant shall maintain complete and accurate records with respect to all costs and expenses incurred under this Agreement. All such records shall be clearly identifiable. Consultant shall allow a representative of City during normal business hours to examine, audit, and make transcripts or copies of such records and any other documents created pursuant to this Agreement. Consultant shall allow inspection of all work, data, documents, proceedings, and activities related to the Agreement for a period of four (4) years from the date of final payment under this Agreement.

3.5 General Provisions.

3.5.1 Termination of Agreement.
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3.5.1.1 Grounds for Termination. City may, by written notice to Consultant, terminate the whole or any part of this Agreement at any time, with or without cause, by giving written notice to Consultant of such termination, and specifying the effective date thereof, at least seven (7) days before the effective date of such termination. Upon termination, Consultant shall be compensated only for those services which have been adequately rendered to City, and Consultant shall be entitled to no further compensation. Consultant may not terminate this Agreement except for cause.

3.5.1.2 Effect of Termination. If this Agreement is terminated as provided herein, City may require Consultant to provide all finished or unfinished Documents and Data and other information of any kind prepared by Consultant in connection with the performance of Services under this Agreement. Consultant shall be required to provide such document and other information within fifteen (15) days of the request.

3.5.1.3 Additional Services. In the event this Agreement is terminated in whole or in part as provided herein, City may procure, upon such terms and in such manner as it may determine appropriate, services similar to those terminated.

3.5.2 Delivery of Notices. All notices permitted or required under this Agreement shall be given to the respective parties at the following address, or at such other address as the respective parties may provide in writing for this purpose:

Consultant: California Yellow Cab
520 West Dyer Road
Santa Ana, CA 92707
ATTN: Akbar Majid
City: City of San Clemente
910 Calle Negocio
San Clemente, CA 92673
ATTN: Laura Campagnolo, City Clerk
Such notice shall be deemed made when personally delivered or when mailed, forty-eight (48) hours after deposit in the U.S. Mail, first class postage prepaid and addressed to the party at its applicable address. Actual notice shall be deemed adequate notice on the date actual notice occurred, regardless of the method of service.

3.5.3 Ownership of Materials and Confidentiality.

3.5.3.1 Documents & Data; Licensing of Intellectual Property. This Agreement creates a non-exclusive and perpetual license for City to copy, use, modify, reuse, or sublicense any and all copyrights, designs, and other intellectual property embodied in plans, specifications, studies, drawings, estimates, and other documents or works of authorship fixed in any tangible medium of expression, including but not limited to, physical drawings or data magnetically or otherwise recorded on computer diskettes, which are prepared or caused to be prepared by Consultant under this Agreement ("Documents & Data"). Consultant shall require all subconsultants to agree in writing that City is granted a non-exclusive and perpetual license for any Documents & Data the subconsultant prepares under this Agreement. Consultant represents and warrants that Consultant has the legal right to license any and all Documents & Data.

Consultant makes no such representation and warranty in regard to Documents & Data which were prepared by design professionals other than Consultant or provided to Consultant by the City. City shall not be limited in any way in its use of the Documents & Data at any time, provided 297
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that any such use not within the purposes intended by this Agreement shall be at City's sole risk.

3.5.3.2 Confidentiality. All ideas, memoranda, specifications, plans, procedures, drawings, descriptions, computer program data, input record data, written information, and other Documents & Data either created by or provided to Consultant in connection with the performance of this Agreement shall be held confidential by Consultant. Such materials shall not, without the prior written consent of City, be used by Consultant for any purposes other than the performance of the Services. Nor shall such materials be disclosed to any person or entity not connected with the performance of the Services or the Project. Nothing furnished to Consultant which is otherwise known to Consultant or is generally known, or has become known, to the related industry shall be deemed confidential. Consultant shall not use City's name or insignia, photographs of the Project, or any publicity pertaining to the Services or the Project in any magazine, trade paper, newspaper, television or radio production or other similar medium without the prior written consent of City.

3.5.3.3 Confidential Information. The City shall refrain from releasing Consultant’s proprietary information ("Proprietary Information") unless the City's legal counsel determines that the release of the Proprietary Information is required by the California Public Records Act or other applicable state or federal law, or order of a court of competent jurisdiction, in which case the City shall notify Consultant of its intention to release Proprietary Information.

Consultant shall have five (5) working days after receipt of the Release Notice to give City written notice of Consultant's objection to the City's release of Proprietary Information. Consultant shall indemnify, defend and hold harmless the City, and its officers, directors, employees, and agents from and against all liability, loss, cost or expense (including attorney’s fees) arising out of a legal action brought to compel the release of Proprietary Information. City shall not release the Proprietary Information after receipt of the Objection Notice unless either: (1) Consultant fails to fully indemnify, defend (with City's choice of legal counsel), and hold City harmless from any legal action brought to compel such release; and/or (2) a final and non-appealable order by a court of competent jurisdiction requires that City release such information.

3.5.4 Cooperation; Further Acts. The Parties shall fully cooperate with one another, and shall take any additional acts or sign any additional documents as may be necessary, appropriate or convenient to attain the purposes of this Agreement.

3.5.5 Attorney's Fees. If either party commences an action against the other party, either legal, administrative or otherwise, arising out of or in connection with this Agreement, the prevailing party in such litigation shall be entitled to have and recover from the losing party reasonable attorney's fees and all other costs of such action.

3.5.6 Indemnification.

3.5.6.1 To the fullest extent permitted by law, Consultant shall defend (with counsel of City’s choosing), indemnify and hold the City, its directors, officials, officers, employees, volunteers and agents free and harmless from any and all claims, demands, causes of action, costs, expenses, liability, loss, damage or injury of any kind, in law or equity, to property or persons, including wrongful death, in any manner arising out of, pertaining to, or incident to any alleged acts, errors or omissions, or willful misconduct of Consultant, its officials, officers, employees, subcontractors, consultants or agents in connection with the performance of the Consultant's Services, the Project or this Agreement, including without limitation the payment of all damages, expert witness fees and attorney’s fees and other related costs and expenses. Consultant’s obligation to indemnify shall not be restricted to insurance proceeds, if any, received by Consultant, the City, its officials, officers, employees, agents, or volunteers. 298
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3.5.6.2 If Consultant’s obligation to defend, indemnify, and/or hold harmless arises out of Consultant’s performance as a “design professional” (as that term is defined under Civil Code section 2782.8), then, and only to the extent required by Civil Code section 2782.8, which is fully incorporated herein, Consultant’s indemnification obligation shall be limited to claims that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Consultant, and, upon Consultant obtaining a final adjudication by a court of competent jurisdiction, Consultant’s liability for such claim, including the cost to defend, shall not exceed the Consultant’s proportionate percentage of fault.

3.5.7 Entire Agreement. This Agreement contains the entire Agreement of the parties with respect to the subject matter hereof, and supersedes all prior negotiations, understandings or agreements. This Agreement may only be modified by a writing signed by both parties.

3.5.8 Governing Law. This Agreement shall be governed by the laws of the State of California. Venue shall be in Orange County.

3.5.9 Time of Essence. Time is of the essence for each and every provision of this Agreement.

3.5.10 City's Right to Employ Other Consultants. City reserves right to employ other consultants in connection with this Project.

3.5.11 Successors and Assigns. This Agreement shall be binding on the successors and assigns of the parties.

3.5.12 Assignment or Transfer. Consultant shall not assign, hypothecate, or transfer, either directly or by operation of law, this Agreement or any interest herein without the prior written consent of the City. Any attempt to do so shall be null and void, and any assignees, hypothecates or transferees shall acquire no right or interest by reason of such attempted assignment, hypothecation or transfer.

3.5.13 Construction; References; Captions. Since the Parties or their agents have participated fully in the preparation of this Agreement, the language of this Agreement shall be construed simply, according to its fair meaning, and not strictly for or against any Party. Any term referencing time, days or period for performance shall be deemed calendar days and not work days. All references to Consultant include all personnel, employees, agents, and subconsultants of Consultant, except as otherwise specified in this Agreement. All references to City include its elected officials, officers, employees, agents, and volunteers except as otherwise specified in this Agreement. The captions of the various articles and paragraphs are for convenience and ease of reference only, and do not define, limit, augment, or describe the scope, content, or intent of this Agreement.

3.5.14 Amendment; Modification. No supplement, modification, or amendment of this Agreement shall be binding unless executed in writing and signed by both Parties.

3.5.15 Waiver. No waiver of any default shall constitute a waiver of any other default or breach, whether of the same or other covenant or condition. No waiver, benefit, privilege, or service voluntarily given or performed by a Party shall give the other Party any contractual rights by custom, estoppel, or otherwise.

3.5.16 No Third-Party Beneficiaries. There are no intended third party 299
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beneficiaries of any right or obligation assumed by the Parties.

3.5.17 Invalidity; Severability. If any portion of this Agreement is declared invalid, illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining provisions shall continue in full force and effect.

3.5.18 Prohibited Interests. Consultant maintains and warrants that it has not employed nor retained any company or person, other than a bona fide employee working solely for Consultant, to solicit or secure this Agreement. Further, Consultant warrants that it has not paid nor has it agreed to pay any company or person, other than a bona fide employee working solely for Consultant, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement. For breach or violation of this warranty, City shall have the right to rescind this Agreement without liability. For the term of this Agreement, no member, officer or employee of City, during the term of his or her service with City, shall have any direct interest in this Agreement, or obtain any present or anticipated material benefit arising therefrom.

3.5.19 Equal Opportunity Employment. Consultant represents that it is an equal opportunity employer and it shall not discriminate against any subconsultant, employee or applicant for employment because of race, religion, color, national origin, handicap, ancestry, sex or age. Such non-discrimination shall include, but not be limited to, all activities related to initial employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination. Consultant shall also comply with all relevant provisions of City's Minority Business Enterprise program, Affirmative Action Plan or other related programs or guidelines currently in effect or hereinafter enacted.

3.5.20 Labor Certification. By its signature hereunder, Consultant certifies that it is aware of the provisions of Section 3700 of the California Labor Code which require every employer to be insured against liability for Worker's Compensation or to undertake self-insurance in accordance with the provisions of that Code, and agrees to comply with such provisions before commencing the performance of the Services.

3.5.21 Authority to Enter Agreement. Consultant has all requisite power and authority to conduct its business and to execute, deliver, and perform the Agreement. Each Party warrants that the individuals who have signed this Agreement have the legal power, right, and authority to make this Agreement and bind each respective Party.

3.5.22 Counterparts/Electronic Signatures. This Agreement may be signed in counterparts, each of which shall constitute an original. This Agreement may be signed with the same force and effect as original ink signatures.

3.6 Subcontracting.

3.6.1 Prior Approval Required. Consultant shall not subcontract any portion of the work required by this Agreement, except as expressly stated herein, without prior written approval of City. Subcontracts, if any, shall contain a provision making them subject to all provisions stipulated in this Agreement.
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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:________________________________
Andy Hall, City Manager
ATTEST: Dated: __________________, 20____
_____________________________
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

Cabco Yellow Inc. dba California
Yellow Cab (“CONSULTANT”)
By:_____________________________
Akbar Majid, Secretary
Dated: __________________, 20____
By:_____________________________
William Rouse, CEO
Dated: __________________, 20____
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EXHIBIT "A"

SCOPE OF SERVICES
Consultant shall perform the following services for the City (collectively, the “Services”):

A. GENERAL

1. Services
Consultant shall successfully operate a transportation service between the residences of San Clemente senior citizens and select locations in San Clemente, providing all necessary vehicles, drivers and other labor, equipment, fuel, and maintenance.

Additionally, Consultant shall provide for all management, personnel, reservations and scheduling, dispatching, operations, computer software, licenses, cyber security, hardware, insurance, record keeping and reporting, telecommunications equipment, and service.

2. OCTA Senior Mobility Program Guidelines
The Orange County Transportation Authority (OCTA) Project U Funding and Policy Guidelines, which are provided in Exhibit B to the Request for Proposal (RFP), are part of this Agreement and are hereby incorporated fully herein. The Consultant must operate the program in compliance with the requirements set forth in the OCTA program guidelines provided in Exhibit B to the RFP.

B. DEFINITIONS

1. Advanced Reservation. Describes the process of requesting trips and receiving trip confirmation prior to the day service is requested.

2. City. The City of San Clemente.

3. Consultant. Paratransit Consultant hired to provide senior transportation services in the City.

4. Curb-to-Curb Service. A type of service where, on both the origin and destination end of the trip, the driver gets out of the vehicle and assists the passenger between the vehicle and a sidewalk.

5. Deadhead. Refers to either miles or hours when a vehicle is not in revenue service, including travel from Consultant’s base to first pick up, time from last drop off back to the Consultant’s base, and travel time during driver breaks and other "out of service" times.

The travel time between scheduled pick-ups and drop offs, regardless of whether a passenger is on board, is not considered deadhead.

6. Door-to-Door Service. A type of service where, on either the origin and destination end of the trip, the driver gets out of the vehicle and meets/escorts the passenger to the door of the main lobby, residence, or building. The driver is responsible for assisting the passenger throughout the trip. Drivers are not allowed to enter a residence or business and must keep the vehicle in their sight at all times.

7. Dwell Time. The amount of time at each pick up or drop off including time which is built into the schedule and time otherwise required for boarding or alighting passengers.

8. Missed Trip. Any scheduled trip in which the vehicle arrives more than 20 minutes after the scheduled pick-up time, or does not arrive at all.
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9. No-Show. A scheduled passenger who does not appear at the designated location for vehicle boarding within 5 minutes of an on-time vehicle arrival, or who calls the Consultant to cancel the trip after 5:30 p.m. the day before a scheduled trip.

10. On-Time Pickup. A vehicle shall be on-time if it arrives at the designated pickup location no more than 5 minutes prior to the scheduled pickup time and no more than 5 minutes after that time.

11. Revenue Service. The time a vehicle is available for passenger transport within the Consultant's established hours of service. A vehicle is available for passenger transport from the time it arrives at the first passenger pickup location and ends at the last passenger drop off, excluding any meal breaks, service breaks, mechanical problems, and time a vehicle is unusable due to an accident.

12. Seniors. Individuals age 60 and older who live within the City.

13. Service Area. The geographic area within the jurisdictional limits of the City of San Clemente for which transportation services are to be provided to seniors.

14. Vehicle Service Hour. Any 60-minute increment of time during which a vehicle is available for passenger transport within the Consultant's established hours of service, also known as revenue service hours. The 60-minute increment of time need not be continuous.

15. Vehicle Service Mile. Mileage reading on the driver trip sheet for each travel day. The "starting odometer" on the trip sheet shall be taken at the location of the first passenger pickup and the "ending odometer" shall be taken at the location of the last passenger drop off, excluding meal breaks, service breaks, and mechanical problems. If mileage readings need to be taken more than once during the day to accommodate breaks, then additional odometer readings shall be recorded on the trip sheet.

C. SAN CLEMENTE SENIOR MOBILITY PROGRAM (SMP) SERVICES
The City’s SMP shall consist of the following service offerings to be provided by the Consultant:

1. Senior Center Transportation
Consultant shall provide transportation for seniors in the service area between their residences and the Dorothy Visser Senior Center located at 117 Avenida Victoria. This service will be provided five (5) days per week on Monday through Friday. There will be no service on weekends or holidays. Seniors residing in San Clemente can be picked up and dropped off to and from their homes from the hours of 8:00 am to 4:00 pm. This service shall be curb-to-curb, however for frail seniors, seniors in wheelchairs, elderly or by request the service shall be door-to-door. Hours of service will be subject to change in the City’s sole discretion based on demand or to improve productivity.

2. Consultant shall provide transportation for seniors in the geographic area between their residences and within the City of San Clemente for the following:
 Grocery Stores
 Medical Appointments (Non-Emergency)
 Personal Care
 Amusement Park
 Aquarium/zoo
 Beach/Park
 Charity/Social Group event
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 Community Cultural Event
 Education/Employment
 Family/Friends
 Funeral/Memorial Service
 Government office/Services
 Library/Museum/Historical Site
 Movies/Theater/concert
 Religious institutions
 Restaurant
 Sporting/Fitness
 Transit Center/Hub
This service will be provided seven (7) days a week from 7:00 am to 7:00 pm, excluding holidays.

The City reserves the right to order a decrease or increase in the level of service such as removing or adding locations at any given time. If the service levels are revised resulting in a change of unit cost provided by Consultant, the City will negotiate with the Consultant to adjust the contract rates or terminate the Agreement, at the City’s discretion.

D. SERVICE OPERATION

1. Reservations. The Consultant shall provide a toll-free telephone number for use by Senior Mobility Program (SMP) patrons. The Consultant shall accept telephone reservations from San Clemente residents from SMP patrons and dispatch a vehicle to the requested pick-up location within the City. Reservations shall be both demand responsive and allow for advanced pre-scheduled one-way or round-trip transportation services. Please provide in your proposal the minimum notice needed for to schedule transportation services.

2. Dwell Time. Maximum dwell time shall not exceed five minutes, except in those cases where drivers must wait before loading/unloading passengers.

3. Travel Time. Under normal conditions, a passenger will not travel on a vehicle for more than 45 minutes from pickup to drop off. The Consultant will ensure that no pattern of excessive passenger travel time develops.

4. On-Time Arrival. The SMP vehicle shall arrive on-time at the scheduled pick-up location, but in no event more than ten (10) minutes after the scheduled pick-up time.

5. SMP Participant Identification. Seniors using the City’s SMP must provide their client ID number when entering the SMP vehicle. Consultant is responsible for administering and implementing a system for enrolling senior citizen participants, verifying eligibility for the City SMP, and issuing photo identification cards to eligible participants.

E. VEHICLES, MAINTENANCE, APPEARANCE/INSPECTIONS.

The Consultant shall be responsible for all operations and maintenance of all participating vehicles, equipment and supplies at its sole cost and expense, including insurance, fuel, taxes, fringe benefits, licensing, dispatching, radio equipment, training, supervision, management, service monitoring and vehicular accident reporting. All such liability shall be 304
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the sole responsibility of the Consultant. Vehicles shall have a mileage fee meter with a current approval and inspection by the Department of Weights and Measures. The Consultant shall assure that participating vehicles meet all applicable codes, laws, and regulations.

At a minimum, Consultant shall perform:
 Daily pre-operation inspections that meet or exceed the guidelines provided by the SMP.
 Scheduled preventative maintenance that meets or exceeds the guidelines provided by the SMP.
 Maintain all maintenance records for each vehicle for five (5) years and shall cooperate fully in annual motor coach carrier terminal inspections conducted by the California Highway Patrol.
 All vehicles shall be uniformed in appearance and include the Consultant’s logo and color scheme.
 All vehicles shall be cleaned daily prior to each vehicle service day and shall be kept clean throughout the day. Vehicle exteriors shall be washed not less than once per week, and after any rain or other circumstances that compromise the vehicles’ clean appearance. Floors shall be free of stains, paper or other debris, gum, or other sticky substances. Windows shall be free of dirt, dust, smudges, hands, or fingerprints, exterior or interior. Dashboards, wheel wells, rails and ledges shall be kept clean, dirt and grease free. Seating areas shall be kept clean and in good repair with attention paid to cleaning upholstery on a regular basis. Wheelchair lifts shall be kept clean and in good repair.

The City reserves the right to remove from service any vehicle that does not meet its appearance and cleanliness standards. Wheelchair accessible vehicles must be available for SMP service.

F. REPORTING REQUIREMENTS

1. Daily Records. The Consultant shall keep daily records of customer service reservations taken. Reservations shall include the client's name, telephone number, pick-up and dropoff address, time the call was received and time the call was dispatched.

2. Monthly Reports. The Consultant shall prepare and submit monthly reports as part of the billing invoice meeting City and OCTA SMP requirements and shall include at minimum the following: Date, Passenger ID #, Passenger Name, Pick-up address, Drop-off address, Pick-up time, Drop-off time, Trip Miles, Co Pay or voucher received, Trip type (trip category or purpose), Number of trips per client, No shows, and Cancellations.

3. Incident Reports. Drivers shall be required to complete “incident reports” after any out of the ordinary occurrence during service including but not limited to vehicle accidents, disputes with or between passengers, passenger injury or accidents (during boarding or on-vehicle), passenger misconduct. Such reports must be submitted to City for review within twenty-four (24) hours after incident.

4. Vehicle Accidents. The Consultant shall have sole responsibility, at its own cost and expense, for repair of any vehicle damaged in a vehicular accident or by any passenger.

The City retains the right to investigate any vehicular accident involving the Consultant, and may request drug/alcohol screening of a driver found to be at fault under specific circumstances.

5. Patron Complaints. The City and Consultant shall investigate and document all complaints or citizen concerns as a part of program administration by collecting as much pertinent information regarding the complaint as possible from the complaining party. The 305
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Consultant shall provide the City with the name and contact information of person to call for reporting customer complaints. Within twenty-four (24) hours of a reported complaint, the Consultant’s assigned representative shall contact the client to resolve the problem and report client complaint to the City. Within forty-eight (48) hours of the reported complaint, the Consultant’s representative shall e-mail to the City the steps they are taking to address the client’s problem. The City reserves the right to exclude any of Consultant’s employees or drivers from participating in the program due to findings relating to a complaint or service issue.

6. Retention/Review of Records. The Consultant shall maintain all records pertaining to the services as required by OCTA Project U Funding and Policy Guidelines. The Consultant shall make its records available to the City upon request during regular business hours either for inspection or audit.

G. PERSONNEL OPERATIONS
Consultant shall be responsible for:

1. Implementing a dress code policy requiring that all Consultant employees driving vehicle(s) pursuant to the Agreement are in a clean, neat, and identifiable uniform.

2. Assigning licensed drivers with a Class B valid California Driver’s license.

3. Training staff involved in the Senior Mobility Program to proficiency so they perform their duties timely, properly, professionally, and safely. Training should include, but is not limited to, disability awareness, passenger assistance and compliance with applicable laws.

4. Ensuring that a properly trained and licensed driver(s) is available during the established SMP operating hours.

5. Ensuring that no Consultant employee performs any services under the Agreement if they have been convicted (or pleads guilty or nolo contendere), regardless of the time elapsed, in any state, of any of the following or their equivalent: murder; a violation of California Vehicle Code Section 2800.2 (pertaining to disregard for safety of persons or property), Section 2800.3 (pertaining to flight from peace officer causing death or bodily injury) or Section 20001 (pertaining to duty to stop at scene of accident); robbery; pandering; pimping; crimes related to the use, sale, possession, or transportation of controlled substances; crimes involving weapons; any crime for which registration would be required under California Penal Code Section 290; or any other offense involving moral turpitude or any crime that is substantially related to the qualifications, functions or responsibilities of a transit operator.

6. Ensuring that no Consultant employee performs any services under the Agreement if they have been convicted of any felony in any state (or pleads guilty or nolo contendere), other than those felonies listed above, within the last eight (8) years.

7. Ensuring that no Consultant employee performs any services under the Agreement if they have been convicted (or pleads guilty or nolo contendere) of any of the following regardless of the time elapsed, in any state, or their equivalent: reckless driving; driving under the influence of intoxicating liquors or drugs (DUI); a violation of California Vehicle Code Section 2800.1 (pertaining to flight from peace officer); Section 20002 (pertaining to duty where property is damaged), Section 20003 (pertaining to duty upon injury or death) or any corresponding substitute sections; vehicular manslaughter; and Penal Code Sections 240, 241, 242, and 243 or any corresponding substitute sections pertaining to assault and battery.

8. Training all Consultant vehicle operators performing services under the Agreement to properly operate all vehicles, including those provided by the City via OCTA, if applicable, and to demonstrate knowledge on proper use of wheelchair lifts, ramps, and other 306
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equipment associated with this service.

9. Consultant shall have in effect personnel policies that conform to all state and federal laws including, but not limited to, all regulations concerning Equal Employment Opportunities, FTA Drug and Alcohol Regulations, Compensation, Workers’ Compensation, and other regulations as appropriate.

10. The City has a zero-tolerance policy for inappropriate behavior between passengers or between passengers and driver. Consultant’s personnel policies must clearly address how inappropriate situations and passenger altercations will be handled. At a minimum, this could include the proper handling of situations in which allegations of sexual misconduct, lewd behavior, or sexual harassment have been made. Consultant must also adopt a zerotolerance policy and shall describe their procedure for training employees with respect to such policy.

11. The purchasing, consumption, and/or possession of illegal substances or alcoholic beverages by Consultant employees performing services under the Agreement are prohibited. Consultant shall immediately remove any employee observed engaging in such conduct from further performance of services under the Agreement. The policies for addressing such incidents should be included in the Consultant's Drug and Alcohol Policies as required by the FTA and in compliance with the FTA Drug and Alcohol Regulations.

12. Conducting pre-employment DMV checks of all personnel hired to provide service under the Agreement. Any operator exceeding the California DMV point system or with a revoked or suspended license will not be allowed to operate the City’s SMP service. Consultant shall comply with the DMV’s Pull Notice Program and shall pay for all applicable license fees for drivers, other personnel, and vehicles. The results of those inspections shall be transmitted to the City.

13. Requiring all vehicle operators to promptly report any in-service mechanical failure, including wheelchair, ramp, or other lifts, to Consultant’s supervisor. Consultant shall promptly ascertain the problem and report any in-service vehicle or other mechanical failure to the City immediately, and not later than the start of the next business day.

H. ADMINISTRATION
Consultant shall be responsible for:

1. Identifying a Project Manager who will oversee the proper operation and administration of all transportation services provided to the City under the Agreement. The designated Project Manager must be available to the City at all times. An organizational chart of Consultant’s management personnel shall be included in the proposal.

2. Consultant shall adhere to the performance standards set by the City, and shall meet periodically with the City to evaluate its performance under the Agreement. Transportation services and passenger demand will be assessed regularly by the City to ensure that the mobility needs of the City’s seniors are met and the SMP is operating reliably and efficiently.

3. Providing on a monthly basis a written summary of service and expenditures and maintaining daily attendance. In addition to SMP mandated reports, a City monthly report must accompany each invoice including dates of service, names and addresses of individuals served, pick-up location, destination location, trip category, vehicle service hours, destinations, and any other coordinate transportation services.

4. Entering into an approved professional services agreement with the City (refer to Exhibit D for standard agreement).

5. Attending preliminary meetings with City staff to finalize the logistics and paperwork to properly implement, coordinate, and administer the SMP program to the satisfaction of the 307
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City and OCTA.

6. Hiring capable and courteous personnel who are responsible for taking requests for transportation service and responding to telephone inquiries regarding the transportation service. Consultant telephones shall be answered by the 4th ring. Two telephone lines must be dedicated to this service. Consultant shall be responsible for paying for the service charges for installation and all toll calls.

7. Providing and maintaining appropriate vehicle storage and maintenance facilities for the garaging of the vehicle(s). If storage facilities are to be acquired, Consultant shall indicate in the proposal what actions will be taken to acquire such facility prior to the Effective Date.

8. Notifying the City of all automobile accidents and passenger injuries, both by telephone immediately and in writing by the close of the next business day.

9. Enforcing all established policies with regard to operational emergencies, driver training, passenger safety, quality control, and professional service performance.

10. In the event of a mechanical malfunction, especially a passenger lift malfunction, Consultant shall provide a wheelchair accessible spare vehicle to ensure continuity of service.

11. Developing and recording in writing procedures, which will be submitted to the City, that a vehicle operator uses related to wheelchair lift failure, passenger disturbances, medical assistance to passengers, accidents, inoperable vehicle with passengers on board, fares, and accountability for funds collected, and customer service standards.

12. Referring all media inquiries to the City for response.

13. Submitting with the proposal, certified financial statements reflecting the financial condition of Consultant for the past two year.

14. Implementing an advance reservation process.

I. FARE COLLECTION AND ACCOUNTABILITY
Consultant shall be responsible for:

1. Adhering to any cash fare that may be established by the City. Currently the City of San Clemente’s SMP is free to eligible seniors, however the City reserves the right to implement a fare at any given time.

2. Having the vehicle operator collect fares daily (if the City establishes a fare) and Consultant will deduct fares from the invoices submitted to the City.

3. Submitting monthly reports that include daily totals of passengers.

4. Keeping all data and records for this project for a minimum of five (5) years after the termination of the Agreement. Consultant shall cooperate fully with the City, OCTA, and/or State agencies in the event an audit of the SMP under the Agreement is conducted.

5. Accepting advanced passenger reservations.
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EXHIBIT "B"

SCHEDULE OF SERVICES
Consultant shall diligently perform the Services to the City’s satisfaction according to the timeframe requested by the City.
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EXHIBIT “C”

INSURANCE REQUIREMENTS

3.2.12 Insurance.

3.2.12.1 Time for Compliance. Consultant shall not commence work under this Agreement until it has provided evidence satisfactory to the City that it has secured all insurance required under this section. In addition, Consultant shall not allow any subconsultant to commence work on any subcontract until it has provided evidence satisfactory to the City that the subconsultant has secured all insurance required under this section.

3.2.12.2 Types of Insurance Required. As a condition precedent to the effectiveness of this Agreement for work to be performed hereunder, and without limiting the indemnity provisions of the Agreement, the Consultant, in partial performance of its obligations under such Agreement, shall procure and maintain in full force and effect during the term of the Agreement the following policies of insurance. If the existing policies do not meet the insurance requirements set forth herein, Consultant agrees to amend, supplement or endorse the policies to do so.
(A) Commercial General Liability: Commercial General Liability Insurance which affords coverage at least as broad as Insurance Services Office "occurrence" form CG 0001, or the exact equivalent, with limits of not less than $1,000,000 per occurrence and no less than $2,000,000 in the general aggregate. Defense costs shall be paid in addition to the limits. The policy shall contain no endorsements or provisions (1) limiting coverage for contractual liability; (2) excluding coverage for claims or suits by one insured against another (cross-liability); or (3) containing any other exclusion(s) contrary to the terms or purposes of this Agreement. (B) Automobile Liability Insurance: Automobile Liability Insurance with coverage at least as broad as Insurance Services Office Form CA 0001 covering "Any Auto" (Symbol 1), or the exact equivalent, covering bodily injury and property damage for all activities with limits of not less than $1,000,000 combined limit for each occurrence. (C) Workers' Compensation: Workers' Compensation
Insurance, as required by the State of California and Employer's Liability Insurance with a limit of not less than $1,000,000 per accident for bodily injury and disease. (D) Professional Liability (Errors & Omissions): Professional Liability insurance or Errors & Omissions insurance appropriate to Consultant’s profession with limits of not less than $1,000,000 per claim. Covered professional services shall specifically include all work to be performed under the Agreement and delete any exclusions that may potentially affect the work to be performed (for example, any exclusions relating to lead, asbestos, pollution, testing, underground storage tanks, laboratory analysis, soil work, etc.). If coverage is written on a claims-made basis, the retroactive date shall precede the effective date of the initial Agreement and continuous coverage will be maintained or an extended reporting period will be exercised for a period of at least three (3) years from termination or expiration of this Agreement. (E) Cyber Liability Insurance with limits not less than $2,000,000 per occurrence or claim, $2,000,000 aggregate. Coverage shall be sufficiently broad to respond to the duties and obligations as is undertaken by Consultant in this agreement and shall include, but not be limited to, claims involving security breach, system failure, data recovery, 310
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business interruption, cyber extortion, social engineering, infringement of intellectual property, including but not limited to infringement of copyright, trademark, trade dress, invasion of privacy violations, information theft, damage to or destruction of electronic information, release of private information, and alteration of electronic information. The policy shall provide coverage for breach response costs, regulatory fines and penalties as well as credit monitoring expenses.

3.2.12.3 Insurance Endorsements. Required insurance policies shall contain the following provisions, or Consultant shall provide endorsements on forms approved by the City to add the following provisions to the insurance policies:
(A) Commercial General Liability:
(1) Additional Insured: The City, its officials, officers, employees, agents, and volunteers shall be additional insureds with regard to liability and defense of suits or claims arising out of the performance of the Agreement.

Additional Insured Endorsements shall not (1) be
restricted to "ongoing operations"; (2) exclude "contractual liability"; (3) restrict coverage to "sole" liability of Consultant; or (4) contain any other exclusions contrary to the terms or purposes of this Agreement. For all policies of Commercial General Liability insurance, Consultant shall provide endorsements in the form of ISO CG 20 10 10 01 (or endorsements providing the exact same coverage) to effectuate this requirement.
(2) Cancellation: Required insurance policies shall not be canceled or the coverage reduced until a thirty (30) day written notice of cancellation has been served upon the City except ten (10) days shall be allowed for non-payment of premium. (B) Automobile Liability:
(1) Cancellation: Required insurance policies shall not be canceled or the coverage reduced until a thirty (30) day written notice of cancellation has been served upon the City except ten (10) days shall be allowed for non-payment of premium.

3.2.12.4 Professional Liability (Errors & Omissions):
(A) Cancellation: Required insurance policies shall not be canceled or the coverage reduced until a thirty (30) day written notice of cancellation has been served upon the City except ten (10) days shall be allowed for non-payment of premium. (B) Contractual Liability Exclusion Deleted: This insurance shall include contractual liability applicable to this Agreement. The policy must “pay on behalf of” the insured and include a provision establishing the insurer’s duty to defend.

3.2.12.5 Workers' Compensation:
(A) Cancellation: Required insurance policies shall not be canceled or the coverage reduced until a thirty (30) day written notice of cancellation has been served upon the City except ten (10) days shall be allowed for non-payment of premium.

3.2.12.6 Primary and Non-Contributing Insurance. All policies of Commercial General Liability and Automobile Liability insurance shall be primary and any other 311
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insurance, deductible, or self-insurance maintained by the City, its officials, officers, employees, agents, or volunteers shall not contribute with this primary insurance. Policies shall contain or be endorsed to contain such provisions.

3.2.12.7 Waiver of Subrogation. All policies of Commercial General Liability and Automobile Liability insurance shall specifically allow Consultant or others providing insurance evidence in compliance with these specifications to waive their right of recovery prior to a loss. Consultant hereby waives its own right of recovery against the City, its officials, officers, employees, agents, and volunteers, and shall require similar written express waivers and insurance clauses from each of its subconsultants.

3.2.12.8 Deductibles and Self-Insured Retentions. Any deductible or selfinsured retention greater than $5,000 must be approved in writing by the City and shall protect the City, its officials, officers, employees, agents, and volunteers in the same manner and to the same extent as they would have been protected had the policy or policies not contained a deductible or self-insured retention.

3.2.12.9 Evidence of Insurance. The Consultant, concurrently with the execution of the Agreement, and as a condition precedent to the effectiveness thereof, shall deliver either certified copies of the required policies, or original certificates on forms approved by the City, together with all endorsements affecting each policy. Required insurance policies shall not be in compliance if they include any limiting provision or endorsement that has not been submitted to the City for approval. The certificates and endorsements for each insurance policy shall be signed by a person authorized by that insurer to bind coverage on its behalf. At least fifteen (15 days) prior to the expiration of any such policy, evidence of insurance showing that such insurance coverage has been renewed or extended shall be filed with the City. If such coverage is cancelled or reduced and not replaced immediately so as to avoid a lapse in the required coverage, Consultant shall, within ten (10) days after receipt of written notice of such cancellation or reduction of coverage, file with the City evidence of insurance showing that the required insurance has been reinstated or has been provided through another insurance company or companies.

3.2.12.10 Failure to Maintain Coverage. In the event any policy of insurance required under this Agreement does not comply with these specifications or is canceled and not replaced immediately so as to avoid a lapse in the required coverage, City has the right but not the duty to obtain the insurance it deems necessary and any premium paid by City will be promptly reimbursed by Consultant or City will withhold amounts sufficient to pay premium from Consultant payments. In the alternative, City may cancel this Agreement effective upon notice.

3.2.12.11 Acceptability of Insurers. Each such policy shall be from a company or companies with a current A.M. Best's rating of no less than A- VII and authorized to transact business of insurance in the State of California, or otherwise allowed to place insurance through surplus line brokers under applicable provisions of the California Insurance Code or any federal law.

3.2.12.12 Enforcement of Agreement Provisions (non estoppel).

Consultant acknowledges and agrees that actual or alleged failure on the part of the City to inform Consultant of non-compliance with any requirement imposes no additional obligation on the City nor does it waive any rights hereunder.
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3.2.12.13 Requirements Not Limiting. Requirement of specific coverage or minimum limits contained in this Appendix are not intended as a limitation on coverage, limits, or other requirement, or a waiver of any coverage normally provided by any insurance.

3.2.12.14 Insurance for Subconsultants. Consultant shall include all subconsultants engaged in any work for Consultant relating to this Agreement as additional insureds under the Consultant's policies, or the Consultant shall be responsible for causing subconsultants to purchase the appropriate insurance in compliance with the terms of these Insurance Requirements, including adding the City, its officials, officers, employees, agents, and volunteers as additional insureds to the subconsultant's policies. All policies of Commercial General Liability insurance provided by Consultant’s subconsultants performing work relating to this Agreement shall be endorsed to name the City, its officials, officers, employees, agents and volunteers as additional insureds using endorsement form ISO CG 20 38 04 13 or an endorsement providing equivalent coverage. Consultant shall not allow any subconsultant to commence work on any subcontract relating to this Agreement until it has received satisfactory evidence of subconsultant’s compliance with all insurance requirements under this Agreement, to the extent applicable. The Consultant shall provide satisfactory evidence of compliance with this section upon request of the City.
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EXHIBIT “D”

COMPENSATION
In complete compensation for the Services provided under this Agreement, the City shall pay the Consultant for actual work performed based on the following fee schedule:

Total compensation under this Agreement shall not exceed $300,000 for the initial three-year term and shall not exceed $100,000 per year for any optional years exercised by the City.

There are no reimbursable expenses under this Agreement. 314
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WORKER’S COMPENSATION INSURANCE CERTIFICATION

WORKERS' COMPENSATION DECLARATION
I hereby affirm under penalty of perjury one of the following declarations:
(ONE OF THE BOXES BELOW MUST BE CHECKED)
I have and will maintain a certificate of consent from the California Labor Commission to self-insure for workers' compensation, as provided for by Section 3700 of the Labor Code, for the performance of the work to be performed under this contract.

I have and will maintain workers' compensation insurance, as required by Section 3700 of the Labor Code, for the performance of the work to be performed under this contract. My workers' compensation insurance carrier and policy number are:

Carrier____________________________________________________ Policy Number______________________________________________ I certify that, in the performance of the work under this Agreement, I shall not employ any person in any manner so as to become subject to the workers' compensation laws of California, and I hereby agree to indemnify, defend, and hold harmless the City of San Clemente and all of its officials, employees, and agents from and against any and all claims, liabilities, and losses relating to personal injury or death, economic losses, and property damage arising out of my failure to provide such worker’s compensation insurance. I further agree that, if I should become subject to the workers' compensation provisions of Section 3700 of the Labor Code, I shall forthwith comply with those provisions.

WARNING: FAILURE TO SECURE WORKERS’ COMPENSATION

COVERAGE IS UNLAWFUL, AND SHALL SUBJECT AN EMPLOYER TO

CRIMINAL PENALTIES AND CIVIL FINES UP TO ONE HUNDRED THOUSAND DOLLARS ($100,000), IN ADDITION TO THE COST OF COMPENSATION, DAMAGES AS PROVIDED FOR IN SECTION 3706 OF THE LABOR CODE, INTEREST, AND ATTORNEY’S FEES.
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Dated: ________________________, 20____
________________________________
(“CONSULTANT”)
By: ________________________________
________________________________
Title
________________________________
Address
________________________________
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1 Senior Mobility Program
City of San Clemente
August 5, 2024
Attachment 3
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318
3 Company Summary
Legal Name of Company:

Cabco Yellow, Inc.

Doing Business As:

California Yellow Cab
520 W. Dyer Road
Santa Ana, Ca 92707
www.CaliforniaYellowCab.com
Dispatch Phone Numbers:
(714)444-4444
(949)444-4444
(657)444-4444
(877)951-8294
Name and Title of Person Authorized to Submit Proposal:

Akbar Majid, President
Ph. (714)427-2555 Ext. 112 Email: [email protected]
Employer Identification Number:
33-0723354
Statement of Ownership:

Cabco Yellow, Inc. is a California S-Corp,
Wholly owned by William Rouse
Years in Business:

Since 1995; 29 years
Failures or Refusals to Complete Any Contracts:

None
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4 Arbitrations, lawsuits, settlements, etc. in the last 5 years There is no pending litigation or arbitration for Cabco Yellow Inc., other than that related to normal operational vehicle accident activity which has resulted in routine litigation, which is being addressed by our company’s insurance carrier. Additionally, there are no other conditions – including those identified above – that Cabco Yellow believes would impede the company’s ability to service the program.

Financial Interests in Other Lines of Business:

SDY Management, LLC Yellow Cab of San Diego
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5 Scope of Work & Proposed Operational System for
City of San Clemente
California Yellow Cab - CYC - proposes to establish a toll-free telephone number for use by the Senior Mobility Program (SMP) patrons in the City of San Clemente. By using this number, program participants may call for on-demand service with the expectation of a cab arriving at the pick-up address within sixty (60) minutes, during program service hours. The phone number will automatically identify the caller as a program participant, and the participant would then only need to provide basic trip information along with their SMP I.D. number. As the current transportation provider for the City of San Clemente, we may keep the current toll-free telephone number or establish a new toll-free number upon request.

In addition to routine on-demand service, program participants may use the same tollfree phone number with the same identifying protocols to reserve services up to two weeks in advance. This can provide CYC dispatch and routers with the ability to preroute these trips to selected drivers.

Reporting and Billing
Documentation and reporting on the part of CYC is managed via our proprietary digitaldispatch system. In addition to monthly trip data and invoicing, highly detailed electronic records are kept in our archiving, and can be accessed and placed into a report in as little as twenty-four hours. Information submitted, stored and readily available for any reporting purposes include rudimentary dispatch data like passengers’ names, pick-up locations, destinations, dates and times of travel, passenger ID number, and additional contact information. Additionally, this data includes GPS “ping” information from the cabs themselves that provide accurate data on the route taken during a trip, vehicle speed, performance standards data, records of customer contact including audio recordings of every call to or from a customer, and event records for each trip like times of pickups and drop offs.
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6 Complaints and Incidents
All complaints will be reviewed by the Project Manager within 24 hours. From there, a remedy for the issue would be offered in addition to the City being contacted as to the status of the issue within 48 hours. Appropriate action will be taken to ensure the complaint does not arise again in any area of our operations.

We view incidents between drivers and passengers as among the most serious problems that can occur in a program like this. CYC is a service business, and therefore any incident that may occur is not acceptable. Once a report of an incident is received, the Program Manager will be charged with obtaining the details of the incident and following up. A detailed report of any accident, injury, or any dispute will be completed and provided to the city.

Per our routine day-to-day operations, all accidents receive the immediate attention of CYC accident investigators. These individuals are charged with rapidly responding to an accident scene if applicable. They use the appropriate reporting protocols to complete a formal investigation report that includes interviews of affected parties, and photographs of the incident and the surroundings.

CYC was one of the first taxicab companies in the U.S. to electronically archive all trip data and continues to do so as a matter of routine.

Detailed itemization of trip data is included in the monthly invoicing. An accounting of ridership, in a line-by-line format, is provided to aid in auditing and oversight of the program.

Experience
CYC has been in the Seniors and Paratransit transportation business since its inception some twenty plus years ago (1995) and is the current service contractor for senior programs in the cities of San Clemente, Brea, Fullerton, Cypress, Laguna Hills, Laguna Woods, Mission Viejo, Orange, Garden Grove, Rancho Santa Margarita and others.

Additionally, we are the exclusive contractor for John Wayne Airport, a franchise in the 322
7 City of Anaheim and have several independent private care organizations, all requiring ADA compliance and driver Sensitivity Orientation programs. CYC is also the transportation provider for OCTA’s Same Day Taxi program and subcontractor in the ACCESS contract.

Of note are the 15+ years’ experience servicing the 25,000 seniors residing in Laguna Woods with a consistent sub 1% complaint record.

As the exclusive John Wayne Airport (JWA) contractor, we are continually challenged to innovate and update our fleet and methods for accommodating the traveling public.

What we learn from our operations at JWA are modern fleet protocols, advanced customer service methods, situational awareness orientation for our staff and drivers, and skills is handling seniors, developmentally disadvantaged and varying cultural expectations. These advances are incorporated into our street-fleet driver orientation programs and help ensure consistency throughout our fleet.

Fleet and Maintenance
CYC has a diverse fleet consisting of conventional sedans, 6-passenger minivans, and ADA compliant wheelchair-access vans.
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8 All taxicabs undergo a rigorous maintenance program, designed to ensure safe and dependable transportation for passengers. Records of inspections and maintenance logs are kept by our company as a permanent record for the vehicles.

The heart of our vehicle maintenance program is called Preventive Safety and Maintenance Inspection (PSMI). This program is designed to identify and correct any potential vehicle issues before they become a more serious problem.

Safety Inspections
Every cab in our fleet is inspected by the driver daily prior to conducting any trip. This helps prevent any vehicle malfunction or unsafe condition including, but not limited to:
• Headlights, taillights, brake lights, interior lights, and turn signals • Steering
• Windshield wipers
• Tires
• Oil, transmission fluid, etc.
• Warning lights on display
• Body, windshield, or interior damage
• Leakage of any fluids
• Horn
• Mirrors
• Double-check the hood to ensure both latches are fastened securely • Wheelchair Vehicles: handrails, wheelchair tie-downs (manual or power), internal and exterior lighting, operation of ramp/lift, etc.

If any malfunction or damage is observed, the vehicle is not driven. 324
9 Interval PMSI Inspections
PMSI inspections are conducted approximately 5,500-mile intervals. The vehicle’s engine oil and filter are changed at each inspection, and the brakes are inspected and adjusted, if necessary.

Automated Maintenance Tracking System
Our company uses an automated driver and vehicle maintenance tracking system which proactively monitors every driver and vehicle in the fleet and records the mileage of each vehicle weekly. Critical driver data tracked by our system includes:
• Driver license and expiration
• Norton Medical expiration (drug screening)
• City driver permit and expiration (if applicable)
• DMV Pull Notice Program
Critical vehicle data tracked includes:
• Vehicle registration and expiration
• Vehicle mileage and preventative maintenance required The program also contains a history of the vehicles’ previous inspections. Based upon all this information, the program will sort the entire fleet and will identify the vehicles that will be coming due for an inspection within the next week, as well as identifying which inspection is due. This information is then conveyed to the Fleet Manager to ensure that the required vehicles are available for the Maintenance Department on the day that they are requested.

All CYC cabs are professionally washed on a weekly basis and drivers are encouraged to always maintain a clean and tidy vehicle. All cabs are randomly inspected in the field.

Any dirty or foul-smelling vehicles are removed from service right away and reinspected for corrections before being returned to service. 325
10 Most CYC cabs are distinct and identical in appearance with a black lower 1/3rd panel, a yellow upper body, and identifying decals in black. As of 2020 some vehicles have been changed to one solid color; yet the decals are arranged in the same position on all vehicles with the California Yellow Cab logo on the front.

Insurance Requirements
Since our vehicles can hold a maximum of 6 riders our automobile liability insurance coverage is with a limit of not less than $1,000,000 for each accident.

Business License
AB1069 states “A city or county shall not require a taxicab company or driver to obtain a business license, service permit, car inspection certification, or driver permit, or to comply with any requirement under this section or Section 53075.52, unless the company or driver is substantially located within the jurisdiction of that city or county”.

Under AB 1069, regulatory fees will be paid to the jurisdiction where taxicabs are “substantially located,” which is defined as both where the taxicab driver or taxicab business is located and where the taxicab provided the largest number of trips in the year prior.

Operations Base in Santa Ana
Our base has approximately 2600 sq. feet of office space and more than 5000 sq. feet of logistics and maintenance facilities, we employ ten full-time staff members in our administrative offices and contract with a dozen more on-site fleet-maintenance technicians and specialists in our facility.

All scheduled and unscheduled maintenance, except for certain bodywork and machine shop work, is performed here. Our maintenance facility is fully equipped to easily perform maintenance ranging from routine oil changes to complete driveline and chassis rebuilds. The shop meets all local zoning requirements and possesses the equipment and is staffed by highly trained and certified technicians. 326
11 Driver Orientation Program
All drivers with California Yellow Cab (CYC) are independent contractors, as is the case with all cab companies in the County.

All applicants must be able to produce the following:
• An Excellent Driving Record
o Current, valid California Driver’s License
o DMV Pull Notice with no more than two moving violations within the previous three years, and ZERO serious violations such as reckless driving, or driving while under the influence of drugs or alcohol • Pass a drug screening initially, and enroll in a random and annually drug and alcohol program
• Live Scan fingerprints
• Successfully pass a background check
• Provide proof of legal residency
• Be placed on the DMV Pull-Notice program
Only after successfully producing the above will a prospective driver be considered for a Lease under the CYC livery.

CYC uses a driver orientation program comprised of four-module platforms called Operations, Safety, Service and Review (OSSR). OSSR focuses much more in-depth on customer service, fare collection policies and sensitivity orientation for providing rides to seniors and individuals with disabilities. Encompassing some 30 hours of classroom and on-the-road orientation and typically presented over a 3–5-day orientation period.

Orientation occurs before the driver is leased a vehicle, annually, and as needed. If there is an update or changes to program guidelines drivers are notified via their tablet and program guidelines are made available to drivers right away. 327
12 All the senior programs we service have asked that our drivers wear a white shirt with dark trousers and dark-colored shoes. Drivers have the option of participating or not, but if they elect to participate, they need to adhere to the programs’ requirements.

Drug and Alcohol Policy
CYC provides safe, dependable, and efficient transportation services to our customers.

Our safety-sensitive employees’ and affiliate’s use of illegal drugs and misuse of alcohol poses a significant risk to public safety, as well as the employee’s and affiliate’s health and wellbeing, and can cause loss of efficiency, productivity, or a disruptive work environment. CYC’s drug and alcohol policy is intended to comply with all applicable State and Federal regulations governing workplace anti-drug use and alcohol misuse programs in the transportation industry. They include DOT 49 CFR Part 40 as amended, (“Procedures for Transportation Workplace Drug and Alcohol Testing Programs”); FTA 49 CFR Part 655 (“Prevention of Alcohol Misuse and Prohibited Drug Use in Transit Operations”); DOT 49 CFR Part 29 (“Drug-Free Workplace Act of 1988”); and CA Govt. Code Section 8350 et. Seq. (“Drug-Free Workplace Act of 1990”). The policy incorporates the requirements of the above regulations for safety-sensitive employees and others when so noted (this policy is available at any time). Drivers undergo an FTA Drug test initially (pre-employment) and must be enrolled in a random pool.
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13 Experience
California Yellow Cab (CYC) is aware of the scope of work and all the tasks that the City of San Clemente requires. The following information includes references and current clients:
2004-Present
City of Laguna Woods
Yolie Trippy, Deputy City Clerk
24264 El Toro Road, Laguna Woods, CA 98263
T949-639-0561 [email protected]
Senior Mobility Program for Laguna Woods’ residents. Non-emergency Medical Transportation is available for any non-emergency medical trips beginning or ending in Laguna Woods (within Orange County and Long Beach VA). Seniors may use the services in Laguna Woods for social, personal care, and shopping transportation. 2012-Present
City of Orange
Katherine Connaghan, Executive Director
170 S Olive St, Orange, CA 92866
T714-538-9633 [email protected]
SMP for residents of Orange. Transportation is provided for non-emergency medical appointments, pharmacy, grocery store, and senior center trips. 2012-Present
City of Mission Viejo
Melanie McGrane, Recreation & Community Services
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14 24932 Veterans Way, Mission Viejo, CA 92692
T949-470-8441 [email protected]
SMP for residents of Mission Viejo. Transportation is provided for non-emergency medical appointments, John Wayne Airport, pharmacy, grocery store, and senior center trips.
2012-Present
City of Laguna Hills
Jessica Cardenas, Administrative Assistant
T949-707-2681 [email protected]
24035 El Toro Road, Laguna Hills, CA 92653
SMP for residents of Laguna Hills. Transportation is provided for non-emergency medical appointments, John Wayne Airport, pharmacy, grocery store, and senior center trips.
2017-Present
City of Lake Forest
Vicky Blethen, Recreational Manager
T949-461-3453 [email protected]
100 Civic Center Dr, Lake Forest, CA 92630
SMP for residents of Lake Forest. Transportation is provided for non-emergency medical appointments, shopping, social, personal care, and senior center trips. 330
15 Key Personnel
Akbar Majid- Mr. Majid has served as the General Manager responsible for the day-today operations of SDY Management, LLC since 2019 and oversee California Yellow Cab as the President. Mr. Majid is responsible and directly involved in all aspects of the business and decision making. Mr. Majid will work with Melissa Gomez, Program Manager, throughout the duration of this contract and ensure we are compliant.

Melissa Gomez- As the Director of Marketing and Program Manager since January 2017, Ms. Gomez is responsible for ensuring our company meets program guidelines and outcome objectives according to the highest standards of service. Ms. Gomez manages existing relationships and leads in handling service issues and/or complaint resolutions relevant to the programs in Orange County. Ms. Gomez has a long history in the transportation sector and now as a Project Manager ensures seniors receive the best service possible and are transported in a safe and timely manner. Ms. Gomez received a bachelor’s degree from California State University San Bernardino and a master’s degree in communications from California Baptist University. 331
16 California Yellow Cab Key Personnel
William Rouse
CEO
Akbar Majid
President
Robert Bowsher CFO
Reyna Chavez
Accounting
Clerk
Melissa Gomez Program
Manager/ Director of
Marketing
Bobbing Nguyen Office
Manager
Matthew Rouse
Fleet Manager Jonatan Martin Driver Manager

Key Personnel Statement: President Akbar Majid and Program Manager Melissa Gomez will be the primary contacts through the duration of the project and acknowledge that if a person designated as “key” shall be removed or replaced the City will receive written notice right away. 332
17 Akbar Majid
[email protected]
619-398-2333
Work Experience
2019-present
Vice President and General Manager
SDY Management, LLC
Yellow Cab of San Diego
• Oversee daily operations of the largest taxicab company in San Diego County • Responsible and directly involved in all aspect of the business and decision makings • Represent the company with all applicable regulatory agencies including Metropolitan Transit Systems, San Diego County Sheriff and San Diego County Regional Airport Authority
• Oversee Transdev/ MTS Access contract
• Working closely with legal counsel in drafting agreements, litigation, depositions and other legal matters
Vice President of Operations
2004-2019 Administrative Services SD, LLC
Yellow Cab of San Diego
• Responsible for forming the largest taxicab Cooperative in San Diego County • Overseeing the agreements, accounting and all other business matters related to over 1000 independent contractor taxicab drivers and permit holders • Overseeing all marketing, sales and public relation related to the business • Oversaw customer complaints and related resolutions
• Responsible and directly involved in union negotiations and administration of the union contract related to all union employees
• Negotiations, review and purchase of all commercial insurance policies such as commercial auto, D&O, EPLI
• Participation in various government meetings such San Diego International Airport Board of Directors, Metropolitan Transit Systems Board of Directors, and MTS Taxicab Advisory Committee
Operations Manager
2001-2004 Transit Capital Corporation
Yellow Cab of San Diego
• Responsible for hiring, discipline, promotion and termination of employees within operations department
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18 • Operated and responsible for all aspects of Direct Access Route Transportation contract with Metropolitan Transit Systems
• Oversaw all employees, scheduling and contract compliance related to the Direct Access Route
• Oversaw the operations of the mechanical repair shop and its employees • Oversaw the mechanical parts shop and its employees
• Oversaw the operations of the limousine and sedan fleet • Responsible for all aspects of the operations department President and General Manager
1993-2004 San Diego Cab and San Diego Dispatch
• Established the company
• Organized independent taxi permit holders and fleets under one organized management team
• Directly responsible for all aspect of the business and decision makings • Established the dispatch service for the company
• Developed company policies and procedures
• Hired employees and entered into agreements with vendors • Developed customers service and driver orientation programs Affiliations
Metropolitan Transit System Taxicab Advisory Committee
Member of The Transportation Alliance
Member of Taxicab and Paratransit Association of California Member of San Diego County Lodging Association
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19 MELISSA GOMEZ
Riverside, CA  714-559-8300 [email protected]
EDUCATION Riverside City College, 2009
California State University San Bernardino, 2014
California Baptist University, 2016
PROFESSIONAL California Yellow Cab, January 2017 to Present Director of Marketing who drives the company through innovative strategic planning, interactive marketing, and sales promotion. In addition to being Marketing Director also the Program Manager that ensures all program guidelines are being met, passengers are transported at a timely and safely manner and ensures there are high levels of customer service being emphasized. Skilled at analyzing customer needs to develop high standard customer service and problem solver who adapts to change and exceeds expectations under any circumstances.

Mission Inn Foundation, August 2016- December 2016
Intern: Oversaw the planning and execution of logistics and operations for events through private meetings and conferences. Worked with event sponsors and vendors on all aspects of planning events. Assisted in achieving business objectives with demanding timeframes and negotiated contracts with vendors and service providers.

Happy Taxi, February 2012- January 2017
Supervising Dispatcher and Paratransit Driver
When starting with Happy Taxi answered routine employee and recruitment related questions such as appropriate documentation submission and application status. Assisted in scheduling interviews and training times/dates for candidates. Provided orientation programs for new staff and routed customer orders in a timely manner. When needed would transport seniors or paratransit members to and from their residence to senior centers, medical, shopping, and/or personal appointments. Also, generated invoices and responded to customers with inquiries and/or complaints.
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20 Statement of Compliance
This proposal is in compliance with the Request for Proposal and the City’s Standard Professional Services Agreement and no exceptions to either are proposed. 336

EXHIBIT C

PROPOSAL COST SUMMARY FORM
Enter below the proposed price for the services described in the Scope of Work, Exhibit A. Prices shall include direct costs, indirect costs, tax, and profits. The quantities provided below are for RFP evaluation purposes only, and could be adjusted up or down. The City’s intention is to award a fixed unit-price type contract. Pricing shall remain firm for a minimum of three (3) years. Any and all requests for pricing adjustments for optional contract renewal periods shall be provided no later than sixty (60) days prior to the end of the initial term. Any such proposed price adjustments shall not exceed the Bureau of Labor Statistics Consumer Price Index (CPI) data for Los Angles-Riverside-Orange County, CA, All Items, Not Seasonally Adjusted, “annualized change comparing the original proposal month and the same month in the subsequent year. This information may be found on the U.S. Department of Labor’s website at www.bls.gov.

Should the City of San Clemente and Cabco Yellow Inc., dba California Yellow Cab come to an agreement, Cabco will provide services to eligible participants using the rates below:
**Rates are based on a one-way basis, per eligible participant **Any rider contribution also known as a Co-pay will be determined by the City 337
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 1
Meeting Date: August 20, 2024 Agenda Item: 11H.

Submitted By: Public Works
Prepared By: David Rebensdorf, Public Works Director/City Engineer Zak Ponsen, Assistant City Engineer
Ryan Kim, Senior Civil Engineer – Traffic
Subject:
..titl e

CONSIDERATION OF A RESOLUTION AWARDING A CONSTRUCTION CONTRACT TO BEAR ELECTRICAL SOLUTIONS, INC. FOR CAMINO CAPISTRANO CROSSWALK IMPROVEMENTS, CIP PROJECT NO. 15321, IN AN AMOUNT NOT TO EXCEED $74,338,

AUTHORIZING THE CITY MANAGER TO EXECUTE THE CONSTRUCTION CONTRACT, AND

FINDING THE PROJECT CATEGORICALLY EXEMPT FROM THE CALIFORNIA ENVIRONMENTAL ..body QUALITY ACT
Fiscal Impact:

The estimated total construction cost of $74,338 is within the total approved budget amount of $100,000 from Account No. 011-864-45300-000-15321 the Road Maintenance/Rehab.

Summary:

Before the City Council is the award of a construction contract to Bear Electrical Solutions, Inc. in an amount not to exceed $74,338, and approval of a 15% project contingency, for the Camino Capistrano Crosswalk Improvements.

Background:

The Camino Capistrano Crosswalk Improvements includes flashing signs at the crosswalk, advance flashing warning signs, in-roadway markings, speed feedback signs, and a red curb as shown on Attachment 2. The project will improve pedestrian crossing to an existing trolley stop.

Eastbound Camino Capistrano Approach to Via Breve
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Meeting Date: August 20, 2024 Agenda Item: 11H.

CITY OF SAN CLEMENTE 2
Westbound Camino Capistrano Approach to Via Breve
Project Plan
On July 2, 2024, staff reached out to local contractors, published a notice inviting bids for this project in the SC Times, and published a bid solicitation on PlanetBids. Bids were opened on August 9, 2024, and the results are presented in the table below. Bids ranged from $74,338 to $295,632. There were no bidders from any businesses based in San Clemente. The lowest responsive and responsible bidder is Bear Electrical Solutions, Inc. of Alviso, California with a total bid amount of $74,338.

Table 1. Bid Summary
Company Name Company Location Amount
Bear Electrical Solutions, Inc Alviso, CA $ 74,338.00
Pelagic Engineering Oxnard, CA $ 78,821.00
California Professional Engineering, Inc. La Puente, CA $ 81,210.28 339
Meeting Date: August 20, 2024 Agenda Item: 11H.

CITY OF SAN CLEMENTE 3
ISSA ELECTRIC INC Riverside, CA $ 89,995.00
Asad Holdings LLC Laguna Hills, CA $119,849.00
Sterndahl Enterprises LLC Sun Valley, CA $129,870.00
Pacific Pavers and Masonry Inc. Anaheim, CA $295,632.00 Based on the lowest bid, the total estimated project construction cost is $92,922 as summarized below:

Table 2. Cost Summary
Construction Management and Inspection $ 7,433.30
Construction $74,338.00
Contingency (15%) $11,150.70
Total Estimated Construction Cost $92,922.00
As required by state law and City policy, Bear Electrical Solutions, Inc. will be required to provide performance and payment bonds simultaneously with execution of the construction contract (Attachment 3). Project plans and specifications are on file in the City Clerk’s office.

Council Options:
 Adopt Resolution No. 24-133 (Attachment 1), awarding the Camino Capistrano Crosswalk Improvements contract to Bear Electrical Solutions, Inc., authorizing the City Manager to execute a construction contract an amount not to exceed $74,338, approving a 15% project contingency of $11,150.70, and finding the project categorically exempt from CEQA under Class 1 (Existing Facilities, 14 CCR section 15301) of the State CEQA Guidelines.  Modify and adopt Resolution No. 24-133.
 Continue the item and direct staff to provide additional information.  Do not award the contract or construct the improvements.

Environmental Review/Analysis:

This project is exempt from the California Environmental Quality Act (CEQA) under Class 1 (Existing Facilities, 14 CCR section 15301) of the State CEQA Guidelines because it consists of repairs to existing City facilities, involves negligible or no expansion of existing or former use and there is no possibility of a direct or reasonably foreseeable indirect effect on the environment.

Recommended Actions:

Staff Recommendation
Staff recommends that the City Council adopt Resolution No. 24-133, which will:
..recommendation

1. Find the Camino Capistrano Crosswalk Improvements, CIP Project No. 15321, categorically exempt from the CEQA under Class 1 (Existing Facilities, 14 CCR section 15301) of the State CEQA Guidelines;
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CITY OF SAN CLEMENTE 4

2. Award the Camino Capistrano Crosswalk Improvements, CIP Project No. 15321, contract to Bear Electrical Solutions, Inc.;

3. Authorize the City Manager to execute a contract with Bear Electrical Solutions, Inc. in an amount not to exceed $74,338, in a form substantially similar to Contract No. 24-47 (Attachment 3) for the Camino Capistrano Crosswalk Improvements, CIP Project No. 15321; and

4. Approve a 15% construction contingency of $11,150.70 for this project. ..end
Attachment:

1. Resolution No. 24-133

2. Improvements

3. Contract No. C24-47
Notification:

All bidders
341
Attachment 1
RESOLUTION NO. 24-133

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SAN CLEMENTE, CALIFORNIA, AWARDING A

CONSTRUCTION CONTRACT TO BEAR ELECTRICAL
SOLUTIONS, INC. FOR CAMINO CAPISTRANO
CROSSWALK IMPROVEMENTS, CIP PROJECT NO. 15321
IN AN AMOUNT NOT TO EXCEED $74,338, PLUS A 15%

PROJECT CONTINGENCY, AUTHORIZING THE CITY

MANAGER TO EXECUTE THE CONTRACT AND FINDING

THE PROJECT CATEGORICALLY EXEMPT FROM THE

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA)
UNDER CLASS 1 (EXISTING FACILITIES, 14 CCR
SECTION 15301) OF THE STATE CEQA GUIDELINES
WHEREAS, the City conducted formal competitive bidding for Camino Capistrano Crosswalk Improvements, CIP Project No. 15321 (Project); and WHEREAS, on August 9, 2024, the City received seven (7) responsive bids ranging from $74,338 to $295,632 for the Project; and
WHEREAS, Bear Electrical Solutions, Inc. was the lowest responsive and responsible bidder with a bid of $74,338.

NOW, THEREFORE, the City Council of the City of San Clemente does hereby find, determine and resolve as follows:

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

SECTION 2. That based upon substantial evidence in the record as a whole, the Project is categorically exempt from the California Environmental Quality Act (CEQA) under Class 1 (Existing Facilities, 14 CCR section 15301) of the State CEQA Guidelines because it consists of repairs to existing City facilities, involves negligible or no expansion of existing or former use and there is no possibility of a direct or reasonably foreseeable indirect effect on the environment.

SECTION 3. That the Construction Contract Agreement for Camino Capistrano Crosswalk Improvements, CIP Project No. 15321, is hereby awarded to Bear Electrical Solutions, Inc.

SECTION 4. That the City Manager is authorized and directed to execute a construction contract for the Camino Capistrano Crosswalk Improvements, CIP Project No. 15321 with Bear Electrical Solutions, Inc. in an amount not to exceed $74,338, in a form substantially similar to that presented to City Council on August 20, 2024.
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Resolution No. 24-133 Page 2
SECTION 5. That a 15% project contingency of $11,150.70 is hereby approved.

SECTION 6. 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 _____ day of August, 2024.

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. 24-133 was adopted at a regular meeting of the City Council of the City of San Clemente held on the _______ day of August, 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 August, 2024. __________________________
CITY CLERK of the City of
San Clemente, California
Approved as to form:
___________________________
Elizabeth A. Mitchell, City Attorney
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Attachment 3
4868-6848-4561 v1
SECTION 00500

CONTRACT

THIS CONSTRUCTION CONTRACT CAMINO CAPISTRANO CROSSWALK IMPROVEMENTS, PROJECT NO. 15321 (“Contract”) is made this _____ day of _________, 2024, in the County of Orange, State of California, by and between the City of San Clemente, a municipal corporation (“City”), and Bear Electrical Solutions, Inc., a California corporation, with its principal place of business at 1252 State Street, Alviso, California, 95002, (“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:

CAMINO CAPISTRANO CROSSWALK IMPROVEMENTS, Project No. 15321 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 30 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 Seventy-Four Thousand Three Hundred and Thirty-Eight Dollars ($74,338). 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 prior written authorization from the City pursuant to the terms and provisions of the Contract Documents.

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 $250 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 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:

Notice Inviting Bids
Instructions to Bidders
Bid Form
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Attachment 3
4868-6848-4561 v1
Contractor’s Certificate Regarding Workers’ Compensation Bid Bond
Designation of Subcontractors
Information Required of Bidders
Non-Collusion Declaration form
Iran Contracting Act Certification
Public Works Contractor Registration Certification
Contract
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 CITY CLERK, CITY OF SAN CLEMENTE or may be obtained online at http//www.dir.ca.gov/dlsr. and which must be posted at the job site.
[SIGNATURES ON FOLLOWING PAGE]
346
Attachment 3
4868-6848-4561 v1
IN WITNESS WHEREOF, this Contract has been duly executed by the above-named parties, on the date first indicated above.

CITY OF SAN CLEMENTE
By:________________________________
Andy Hall, City Manager
ATTEST:
______________________________ Dated: ____________________, 20____ 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

Bear Electrical Solutions, Inc.,
a California corporation
(“CONTRACTOR”)
By:_____________________________
Andrew Bader, Chief Executive Officer,
Secretary, Chief Financial Officer
Dated: __________________, 20____

END OF CONTRACT
347
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 1
Meeting Date: August 20, 2024 Agenda Item: 11I.

Submitted By: Public Works
Prepared By: David Rebensdorf, Public Works Director/City Engineer Subject:
..titl e
RESPONSE TO 2023-2024 ORANGE COUNTY GRAND JURY REPORT “TALKING TRASH:

RECYCLABLES AND ORGANIC WASTE” ..body
Fiscal Impact:

None at this time.

Summary:

On June 11, 2024, the 2023-2024 Orange County Grand Jury report, “Talking Trash: Recyclables and Organic Waste” was published. The report focuses on requirements established by Senate Bill (SB) 1383 and challenges cities have in meeting established goals for diversion and procurement. The Grand Jury requires a response from the City on ten Findings and seven Recommendations in the report, and the responses must be submitted to the Presiding Judge of the Superior Court by September 8, 2024.

Background:

The 2023-2024 Orange County Grand Jury report, “Talking Trash: Recyclables and Organic Waste”, is provided as Attachment 1. The report identifies challenges related to Orange County cities in meeting SB 1383 diversion of organics from the landfill. Organic waste, which is primarily comprised of green waste, wood, food waste, and fibers, such as paper and cardboard release methane gas as they decompose in landfills, which is harmful to the environment. SB 1383 requires a reduction in methane gas caused by decomposing organics in landfills by requiring agencies to divert organics by 50% in 2020 and 75% in 2025.

The report outlines limited sources for organic diversion within Orange County, investigation, analysis, findings and recommendations. The report identifies ten Findings (p. 18 of 33 of the report) and seven Recommendations (p. 19 of 33 of the report). California Penal Code Section 933 requires the City to provide a response to each of the Findings and Recommendations in the report. California Penal Code Section 933.05 specifies the exact manner in which the responses and comments on the Findings and Recommendations are to be made.

The responses must be submitted to the Presiding Judge of the Superior Court by September 8, 2024. Staff has prepared draft responses below for the City Council’s consideration. The proposed responses are based on staff’s knowledge and experience of solid waste and recycling.

Grand Jury Findings
In accordance with California Penal Code Sections 933 and 933.05, the 2023-2024 Grand Jury requires responses from each agency affected by the findings. Based on its investigation titled 348
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CITY OF SAN CLEMENTE 2
"Talking Trash: Recyclables and Organic Waste," the 2023-2024 Orange County Grand Jury has arrived at ten principal findings. Below are the Findings and proposed responses:

Container Standardization
F1 The majority of Orange County jurisdictions have not yet required their haulers to distribute residential containers that meet the CalRecycle standardized colors, leaving legacy and often incorrect or illegible labeling and embossing in place.

Staff Recommended Response:

Agree based on the grand jury report, but the City of San Clemente has limited knowledge of other cities solid waste and recycling contracts. In addition, it may be challenging for compliance since there have there have been supply chain issues with obtaining new containers according to the City’s hauler.

Funding and Enforcement
F2 While a jurisdiction may not delegate its overall responsibility for compliance with State requirements to a hauler, some jurisdictions have designated the task of imposing and collecting fines from residents to the hauler in accordance with State law. However, not all jurisdictions are clear on who ultimately receives and retains the collected fines.

Staff Recommended Response:

Agree based on the grand jury report, but the City of San Clemente has limited knowledge of other cities solid waste and recycling contracts. However, the City of San Clemente collects and retains any fines imposed on customers related to compliance.

F3 All jurisdictions will eventually start collecting fines from residents for non-compliance, but some have not yet determined whether the revenues will go into a waste and recycling enterprise fund or into the jurisdiction’s general fund.

Staff Recommended Response:

Agree based on the grand jury report, but the City of San Clemente has limited knowledge of what other cities are doing with collected fines or their intentions. However, the City of San Clemente fines go directly into the City’s solid waste and recycling enterprise fund.

Education and Outreach
F4 In most jurisdictions, education and outreach is a joint effort between jurisdiction, hauler, and sometimes consultants, with the jurisdiction reviewing the materials before publication. The methods of dissemination vary by jurisdiction and hauler but frequently rely on a resident actively seeking the information, which requires the resident to have some awareness of the new mandates in the first place. Most efforts primarily revolve around intermittent hard-copy paper mailings.

Staff Recommended Response:

Agree; however, the City of San Clemente has not conducted an independent survey to confirm this finding.
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F5 Most jurisdictions currently have no way to accurately determine the effectiveness of their respective education and outreach efforts other than the eventual inspections or audits that will take place.

Staff Recommended Response:

Agree; however, the City of San Clemente has not conducted an independent survey to confirm this finding for jurisdictions.

Procurement of Recovered Organic Waste Products
F6 There is some concern that there are not enough composting facilities in Orange County to process all organic waste, forcing some jurisdictions/haulers to transport it long distances for processing.

Staff Recommended Response:

Agree; the City of San Clemente’s organic waste is transported to Perris, CA for processing.

F7 There is currently no infrastructure in the county that is a State-approved source of Renewable Natural Gas (RNG) and energy from organic waste. Jurisdictions that use vehicles running on RNG procured from non-approved sources cannot count that RNG towards fulfillment of their procurement requirement.

Staff Recommended Response:

Disagrees Partially because the City of San Clemente has limited knowledge or RNG infrastructure. However, the City of San Clemente’s hauler is producing RNG from the City’s organic waste in Perris, CA and diverting the RNG to Edison. In return, the hauler receives credits toward RNG fueling stations throughout the state.

F8 The formula used by the State to calculate a jurisdiction's procurement target does not account for a jurisdiction’s population density or geographic size (square miles). As such, meeting the annual procurement target presents a significant challenge for most jurisdictions.

Staff Recommended Response:

Agree.

F9 Many Orange County jurisdictions were unable to meet the requirement in SB 1383 to reduce organic waste sent to landfills by the 2020 deadline. It is unlikely the required seventy-five percent reduction will be achieved by the 2025 deadline.

Staff Recommended Response:

Agree; however, the City of San Clemente is currently diverting seventy one percent and believes seventy five percent is achievable with the addition of multifamily organic waste diversions.

F10 The current procurement requirements mandated by SB 1383 are unrealistic and likely unachievable by most jurisdictions.
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CITY OF SAN CLEMENTE 4
Staff Recommended Response:

Agree; however, the City of San Clemente has not conducted an independent survey to confirm this finding.

Grand Jury Recommendations
In accordance with California Penal Code Sections 933 and 933.05, the 2023-2024 Grand Jury requires responses from each agency affected by the recommendations presented in this section.

Below are the Recommendations and proposed responses:

Container Standardization
R1 All jurisdictions should expedite the acquisition and distribution of residential containers that meet the CalRecycle standardized colors. Additionally, until the compliant containers can be distributed, all jurisdictions should ensure the distribution of labeling for non-compliant containers that explain the current SB1383 requirements applicable to their jurisdictions by June 30, 2025.

Staff Recommended Response:

The recommendation has been partially implemented and will be fully implemented prior to the SB 1383 regulations by 2036. The City of San Clemente has implemented the threecart system with co-collected organics over a decade ago. The City’s hauler provided standardized color-coded carts with labeling at the time and continue to see positive participation. If a customer requests an exchange of bins, they will be delivered with the new SB 1383 compliant carts. In addition to the carts, the City and hauler provide quarterly outreach and educational material to residents regarding how to properly sort their material and details regarding available and mandated programs.

Funding and Enforcement
R2 By December 31, 2024, all jurisdictions should ensure their waste hauling agreements are in compliance with State statute so that haulers may be designated to perform certain required tasks but are not improperly delegated overall responsibility for compliance. Additionally, all jurisdictions should ensure that any fines collected by a hauler are forwarded to the jurisdiction.

Staff Recommended Response:

The recommendation has been partially implemented and will be fully implemented prior to December 31, 2024. The City is in process of revising its Solid Waste and Recycling Contract, however, the City of San Clemente currently has the responsibility for enforcement.

R3 The OCGJ recommends that all jurisdictions utilize a dedicated waste and recycling enterprise fund for collection of fines for non-compliance with SB 1383 by December 31, 2024.

Staff Recommended Response:

The recommendation has been implemented; the City of San Clemente has a dedicated enterprise fund for Solid Waste and Recycling that includes a revenue source for fines.

Education and Outreach
R4 By December 31, 2024, all jurisdictions should diversify the methods and media used for education and outreach to include, among others, various social media platforms, emails to 351
Meeting Date: August 20, 2024 Agenda Item: 11I.

CITY OF SAN CLEMENTE 5
residents, newspaper, television, flyer mailings, community events, and appearances at other public gatherings.

Staff Recommended Response:

The recommendation has been implemented; the City of San Clemente and its Solid Waste and Recycling Contractor utilize a variety of formats to provide education and outreach, including, quarterly mailings, community events and appearances at social gatherings. In addition, the City of San Clemente recently received training and is improving its use of social media platforms to provide more information through short video formats.

R5 By December 31, 2024, and in order to gauge the effectiveness of their education and outreach efforts, all jurisdictions should develop new methods to engage residents directly to help determine their awareness of the requirements associated with SB 1383, such as surveys, online quizzes, and door-to-door polling.

Staff Recommended Response:

The recommendation has been implemented, the City of San Clemente and its Solid Waste and Recycling Contractor utilize a variety of formats to provide feedback at special events and through surveys. The City will continue to make improvements to its education and outreach efforts and to gauge customer awareness.

R6 By June 30, 2025, the OCGJ recommends that all jurisdictions participate in the OCW&R-led efforts to develop a coordinated county-wide approach to the organics recycling infrastructure and programs as well as procurement requirements associated with SB 1383, working towards creating circular economy as a long-term goal.

Staff Recommended Response:

The recommendation has not yet been implemented, but will be implemented based on the time frame determined by OCW&R. The city will participate in supporting the recommendation with OCW&R.

R7 By December 31, 2024, the Orange County Board of Supervisors and all Orange County cities should lobby appropriate members of the State Legislature and/or CalRecycle to revise the organic waste diversion targets to better reflect Orange County’s waste amounts, revise the jurisdictions’ procurement requirements to better represent the limited options currently available for procurement, the jurisdictions’ varying populations, population densities, and geographic size, and to delay associated enforcement actions by the State.

Staff Recommended Response:

The recommendation has not yet been implemented, but will be implemented with coordination between the Orange County Board of Supervisors and agreement between the Orange County Cities. The city will support the recommendation to the extent the coordinated effort is acceptable to the Orange County Board of Supervisors and cities by June 30, 2025.
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CITY OF SAN CLEMENTE 6
Council Options:
 Adopt Resolution No. 24-134, approving the staff-recommended responses to the 2023-2024 Orange County Grand Jury report, “Talking Trash: Recyclables and Organic Waste.”  Modify and adopt Resolution No. 24-134 by making modifications to the staff-recommended responses to the 2023-2024 Orange County Grand Jury report, “Talking Trash: Recyclables and Organic Waste” and approve such responses as modified.  Continue the item and provide staff with alternative direction.

Environmental Review/Analysis:

The proposed action is not a “project” pursuant to California Environmental Quality Act Guidelines Sections 15378. (14 CCR § 15378.)
Recommended Actions:

Staff Recommendation ..recommendation
Adopt Resolution No. 24-134, entitled: “A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF SAN CLEMENTE, CALIFORNIA, APPROVING RESPONSE TO FINDINGS AND RECOMMENDATIONS IN THE REPORT OF THE ORANGE COUNTY GRAND JURY – ‘Talking Trash: Recyclables and Organic Waste’”, and authorizing and directing the Mayor to respond to the findings and recommendations noted in the report by submitting a letter to the Presiding Judge of the Superior Court by September 8, 2024 in substantially the same form as attached to the Resolution as Exhibit A.
..end
Attachment:

1. 2023-2024 Orange County Grand Jury report, “Talking Trash: Recyclables and Organic Waste”

2. Proposed Resolution No. 24-134, with Exhibit A - City of San Clemente’s Response to Findings and Recommendations of the 2023-2024 Orange County Grand Jury report, “Talking Trash:

Recyclables and Organic Waste”
Notification:

None.
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Attachment 1
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2023-2024 Orange County Grand Jury Page ii

TABLE OF CONTENTS
SUMMARY...................................................................................................................... 3 BACKGROUND.............................................................................................................. 3 REASON FOR THE STUDY........................................................................................... 4 METHOD OF STUDY...................................................................................................... 5 INVESTIGATION AND ANALYSIS................................................................................. 6 Overview of SB 1383.................................................................................................. 6 How Are Jurisdictions Impacted by SB 1383? ........................................................ 7 Orange County Jurisdictions’ SB 1383 Implementation Status............................. 8 How do jurisdictions assess their own progress? ..................................................... 8 Main Implementation Issues ..................................................................................... 8 COMMENDATIONS...................................................................................................... 18 FINDINGS..................................................................................................................... 18 RECOMMENDATIONS................................................................................................. 19 RESPONSES................................................................................................................ 21 Responses Required ............................................................................................... 22 Findings – 90 Day Response Required .................................................................. 22 Recommendations – 90 Day Response Required.................................................. 24 REFERENCES.............................................................................................................. 25 GLOSSARY.................................................................................................................. 26 APPENDICES............................................................................................................... 28 APPENDIX A – SURVEY RESULTS......................................................................... 28 APPENDIX B – CIRCULAR ECONOMY STARTS IN YOUR KITCHEN................... 33 355
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2023-2024 Orange County Grand Jury Page 3

SUMMARY
In 2016, the State of California enacted Senate Bill (SB) 1383, requiring counties, cities, and other organizations responsible for waste collection to coordinate with their residents to divert organic waste, including food scraps, from the landfill waste disposal stream. Another provision makes jurisdictions responsible for procuring a quantity of the recovered organic waste products resulting from the diversion. The 2023-2024 Orange County Grand Jury (OCGJ) investigated how Orange County jurisdictions are complying with the requirements and goals of SB 1383 that impact single-family residential units.

The investigation revealed that the approaches to meeting SB 1383’s requirements vary greatly from jurisdiction to jurisdiction. The majority of Orange County jurisdictions have not yet distributed residential waste containers that meet the SB 1383 standardization requirements, leaving outdated labeling/embossing in place. Education and outreach have not yet taken place at all in some jurisdictions. Even when information has been disseminated in other jurisdictions, the methods disproportionately favor intermittent paper mailings. Also, the State’s unrealistic targets for the procurement of recycled organic waste products do not account for a jurisdiction’s population density or geographic size, which frequently makes them extremely difficult to meet.

The local enforcement stage of SB 1383 started on January 1, 2024. However, the majority of Orange County jurisdictions are unlikely to meet the SB 1383 targeted seventy-five percent reduction in the amount of organic waste sent to landfills by January 2025.

The OCGJ concludes there is a clear need to improve education and outreach efforts, develop enforcement mechanisms and processes, and to coordinate and collaborate among all jurisdictions to collectively address the challenges and to achieve the goals and targets of SB 1383.

BACKGROUND
Organic waste comprises more than a third of the waste stream in California and includes green waste, wood, food waste, and fibers such as paper and cardboard.

When left to decompose in landfills, organic waste releases large amounts of methane gas which is harmful to the environment (CalRecycle, 2024). In September 2016, SB 1383 set reduction targets in a statewide effort to reduce emissions of Short-Lived Climate Pollutants (SLCP) including methane. Simply put, this required all statewide jurisdictions to implement mandatory organic waste collection and recycling to divert organic waste from landfills. Another key benefit of the diversion of organic and other recyclable material from landfills is the preservation of overall landfill capacity.

In 2014, the State conducted random sampling of twenty-six landfills, Material Recovery Facilities (MRF), and Transfer Stations located in twenty-one of California’s fifty-eight counties (none in Orange County). The results were used to establish the baseline for 356
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2023-2024 Orange County Grand Jury Page 4
the required reduction in organic waste destined for landfills. SB 1383 then set goals to reduce organic waste sent to landfills below the 2014 baseline by fifty percent no later than January 1, 2020, and seventy-five percent by January 1, 2025. However, despite the law’s requirements, the amount of organic waste sent to landfills statewide actually increased by twenty-three percent above the 2014 baseline (Little Hoover Commission, 2023).

SB 1383 requires all jurisdictions to memorialize the bill’s requirements in their municipal codes and ordinances no later than January 1, 2022. One of the results of these changes is that each jurisdiction had to amend or renegotiate their waste haulers’ franchise agreements to incorporate the new requirements.

In accordance with SB 1383, as of January 1, 2024, all jurisdictions (and therefore all waste producers) will be subject to enforcement, including monetary fines. While SB 1383 has a myriad of requirements for commercial as well as residential waste producers, the OCGJ narrowed its investigation to the impacts associated with local jurisdiction compliance with SB 1383 on Orange County residents. This report focuses on the specific requirements associated with SB 1383, the local actions taken so far to meet those requirements, the success of those actions and how they are measured, local agency outreach and education efforts, and the challenges that remain for the County of Orange and the county’s thirty-four cities.

REASON FOR THE STUDY
The organics diversion mandate under SB 1383 began to take effect in California on January 1, 2022. This means that jurisdictions in California were required to implement programs for the separation and diversion of organic waste, including food scraps, from landfill disposal. The actual enforcement of this requirement started on January 1, 2024.

The OCGJ’s intent was to take a closer look at how Orange County jurisdictions are responding to this mandate, their successes and challenges, and the impact of this new requirement on the Orange County residents.

The OCGJ initially focused on two questions:
• What actions have Orange County jurisdictions taken to implement organics collection for their residential customers, and how do they measure the success of these actions?
• Given that one key to the success of SB 1383 is public participation, have local jurisdictions conducted sufficient outreach and education? While investigating the answers to these questions, the OCGJ discovered additional information about Orange County recycling and waste management that is notably relevant to this topic and is included in this report.
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METHOD OF STUDY
The OCGJ toured several local waste facilities, including:
• The Frank R. Bowerman landfill in Irvine, owned by the County of Orange and managed and operated by OC Waste & Recycling (OCW&R). This enabled the OCGJ to gain a better understanding of the refuse collection and disposal process.
• The MRF operated by Rainbow Environmental Services, located at 17121 Nichols Lane in the city of Huntington Beach. This facility was previously decommissioned then reopened on short notice when the newer Anaheim MRF was destroyed by fire in February 2022.
• The MRF operated by Waste Management, located at 2050 North Glassell Street in the city of Orange. This tour allowed the OCGJ to gain information on the operation of a newer, larger MRF.

The OCGJ reviewed SB 1383 and related documents, training videos, public meeting recordings, and presentations available on the CalRecycle website.

The OCGJ reviewed online publications from various organizational and media sources related to trash hauling and general operations of the waste and recycling industry and conducted fourteen interviews with representatives from the waste industry, local jurisdictions, and the State’s enforcement agency.

The OCGJ also disseminated a nine-question survey to each of the thirty-four Orange County cities and the County to obtain their perspectives on local implementation of SB 1383. Follow-up interviews were conducted with representatives of the same ten cities included in the 2019-2020 OCGJ report “OC Recycling: Doing it the Right Way” and the County for additional insight into each jurisdiction’s implementation of, and compliance with, SB 1383’s requirements.

The OCGJ utilized the same sampling of ten cities as well as the County of Orange (for its unincorporated areas) because they represent different geographical areas of the county (from Brea in the north to Dana Point in the south) and reflect a variety of larger cities by population and/or land area (e.g., Santa Ana, Irvine) and some that are smaller (e.g., Buena Park, Mission Viejo).

Individual members of the OCGJ also observed the types and colors of carts, their labeling, and their contents at various locations throughout the county. These observations were documented via photographs to illustrate dissimilar details and nuances among jurisdictions and haulers.
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INVESTIGATION AND ANALYSIS
Overview of SB 1383
SB 1383 set ambitious targets for reducing organic waste disposal in landfills from the 2014 baseline: fifty percent by January 2020 (which was not met), and seventy-five percent by January 2025. Organic waste comprises more than half the waste stream in California and includes green waste, wood, food waste, and fibers such as paper and cardboard. When left to decompose in landfills, organic waste releases large amounts of methane gas. The overall goal of the bill is to reduce greenhouse gas emissions by at least four million metric tons per year by 2030 by requiring that “organics” going to the landfill be reduced to 5.7 million metric tons by 2025.

This groundbreaking legislation is a statewide effort to reduce Short-Lived Climate Pollutants (SLCPs). SLCPs such as methane, black carbon, tropospheric (ground level) ozone, and hydrofluorocarbons remain in the atmosphere for a shorter time than carbon dioxide but have a much stronger warming effect. Therefore, reducing SLCPs has the potential to significantly slow global climate change in the near term (California Air Resources Board, 2024). The State’s efforts and policies are intended to substantially increase the rate of organic material diversion away from landfills. This diversion goal is meant to move the State towards the desired “circular economy” where organic waste is collected, converted into new materials or products, and reused for other purposes.

Figure 1 Source: CalRecycle
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How Are Jurisdictions Impacted by SB 1383?
In this context, a jurisdiction may be a city, county, city and county, or special district that collects solid waste.

The jurisdictions’ responsibilities specified by SB 1383 relating to residential units include (CalRecycle, 2024):
• Providing organics collection services to all residents • Conducting education and outreach to community
• Procuring recyclable and recovered organic products
• Securing access to recycling capacity
• Monitoring compliance and conducting enforcement
SB 1383 contains a significant amount of detail regarding the types of allowable collection programs. Critical requirements are listed below:
• Each resident must subscribe to an organic waste collection service that either “source-separates” the waste by using separate bins or transports all unsegregated waste to a facility that recovers seventy-five percent of the organic content collected.
• SB 1383 requires one of the following collection options:

A one-can system – all contents are transported to a facility that recovers seventy-five percent of the organic content.

A two-can system – at least one of the containers (whichever includes organic waste and garbage) must be transported to a facility that recovers seventyfive percent of the organic content.

A three-can system – organic waste is required to be source separated (recyclables in blue, food and yard waste in green).

Jurisdictions must also conduct education and outreach to all residents regarding collection service requirements, contamination standards, self-haul requirements, and overall compliance with SB 1383. Educational material must be linguistically accessible to non-English speaking residents.
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Figure 2 Source: CalRecycle
Orange County Jurisdictions’ SB 1383 Implementation Status How do jurisdictions assess their own progress?
The OCGJ sent a ten-question survey to thirty-four cities and OC Waste & Recycling (OCW&R) and received thirty-one responses. The purpose of the survey was to verify how these agencies measure their progress on the implementation of various aspects of SB 1383. Survey participants were asked to mark their progress on the scale from 1 (significant challenges) to 5 (excellent) for each of the questions. The survey questions as well as more detailed information on responses and follow-up comments and explanations is included in Appendix A.

Main Implementation Issues
To follow-up on the survey, the OCGJ conducted a series of interviews with jurisdictions to learn more about their specific challenges in implementing SB 1383, successes, concerns, and solutions to common issues. The eleven jurisdictions interviewed were the same included in the 2019-2020 OCGJ report “OC Recycling: Doing it the Right Way” representing different geographical areas of the county and a variety of populations and/or land areas. Several themes emerged from the interviews:
• Container Standardization
SB 1383 requires standardized colors for residential and business curbside containers (green for organics, blue for recyclables, and grey for trash). It also requires container

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labels on new containers. The color scheme for collection containers must meet either of these requirements:
o The lid of the container is the correct designated color o The body of the container is the correct designated color, and the lid is also the same specified color or may be gray or black
Out of the eleven jurisdictions interviewed, only two have distributed containers that meet the State requirements. However, jurisdictions are not required to replace containers prior to January 1, 2036. Most are replacing their containers gradually over time. The variety of colors used by various jurisdictions contributes to the confusion and potentially increases contamination rates. In many cases, existing containers include embossed information that is no longer accurate or labels with outdated information (see examples below).

Figure 3. The embossed information wrongly directs residents to put plastic grocery bags in the recycling container. Photo: OCGJ 362
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Figure 4. The old sticker incorrectly directs residents to put shoes, clothes, and other textiles in the recycling container. Photo: OCGJ Figure 5. Outside label on the ‘green waste’ container contains no information regarding food scraps. Photo: OCGJ
The following two images of the “Food Scrap” container (outside and inside) were taken by an OCGJ member in a public park. The contents of the container, which contains unallowable items, such as plastic packaging, further underscores the need for clear signage and more public education.
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Figure 6. Lid of the “Food Scraps” container in a public park from November 2023 showing correct information. Photo: OCGJ
Figure 7. Contents of the same “Food Scraps” container in the public park from November 2023. Photo: OCGJ
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Another standardization issue is that what is accepted for recycling varies among the jurisdictions and haulers.

For example, some allow palm fronds into organics bins while others do not, and some allow food scraps to be deposited in compostable bags while others do not, further adding to the confusion.
• Funding and Enforcement
While conducting interviews with the Orange County jurisdictions, the OCGJ learned that there are two approaches to funding their solid waste management programs (including SB 1383 implementation activities): (1) using an enterprise fund; and (2) using the general fund. Using an enterprise fund ensures that all revenues generated by the solid waste management program are reinvested in that program rather than being diverted into other needs of the jurisdiction.

Even though enforcement activities were effective starting January 1, 2024, jurisdictions only conduct inspections and spot-checks of residential customers’ organic and trash containers using either “lid flipping” or smart trucks that record the contents of the containers as they are being emptied. Haulers (via contracts) have been designated to perform these functions. If residents are found to be in violation, the first step is to provide them with additional educational materials and information. If the violation persists, warning notices are issued. The final step is issuing fines. The penalties imposed by a jurisdiction are based on Government Code Sections 53069.4, 25132, and 36900, and are as follows:
• First violation: $50-$100 per violation;
• Second violation: $100-$200 per violation;
• Third or subsequent violation: $250-$500 per violation Penalties increase when an entity violates the same requirement within a one-year period (CalRecycle, 2024).

While jurisdictions have yet to collect fines, some have not even established the collection protocol or the account where collected fines will be deposited. • Education and Outreach
Clearly, there is a need for more education and outreach. The success of SB 1383 implementation and the ability to reach the CalRecycle goal of a seventy-five percent diversion rate depend largely on residents’ compliance and behavior change. Education and outreach is the first and most critical component of that change. “The accuracy of consumer disposal decisions directly influences the performance of the recycling system.” (Christian Blanco C. S., 2023) 365
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Most interviewed jurisdictions collaborate with haulers to create and distribute educational materials. Others also use consulting services for that purpose. Outreach strategies, the number of outreach events and communications, as well as participation rates vary greatly from jurisdiction to jurisdiction, but most rely heavily on paper mailings, which may not be the most effective way of reaching the public. If combined with junk mail, the educational material may go unread into a recycling bin, if not the trash. Frequently, the information flyers are mailed together with hard-copy utility bills, which may overlook those who subscribe to electronic billing.

As part of their outreach/education campaigns, some of the interviewed jurisdictions purchased kitchen pails for recycling food scraps to distribute to some or all households.

These purchases were funded through SB 1383 assistance grants from CalRecycle, which most of the Orange County jurisdictions applied for and received.

The OCGJ reviewed a sampling of educational materials being distributed by several cities and concluded that the quality of these materials can range from highly informative publications with accessible and attractive designs to flimsy “newsletters” issued by haulers for their respective jurisdictions with graphics and instructions that are barely legible.

Paper mailings have their role but represent only one of many possible outreach methods. The recycling industry itself is embracing technological advancements, including the use of Artificial Intelligence (AI), in waste sorting, predicting trends, the use of smart hauler trucks and smart bins, as well as in outreach and education (Recycling Inside, 2023).

According to Recycling Inside, “AI can play a pivotal role in educating the public about recycling practices. Chatbots and virtual assistants powered by AI can provide real-time guidance on waste disposal, recycling guidelines, and collection schedules. By engaging with individuals through personalized interactions, AI-driven platforms can raise awareness, promote recycling behavior, and facilitate proper waste management at the consumer level.”
According to research by the Recycling Partnership, “People have a misconception that what is recyclable doesn’t change. They are recycling incorrectly in some cases because they are basing decisions on past guidelines and recycling knowledge such as believing milk cartons are wax coated and should not be recycled, or envelopes with windows should not be recycled. They think they know what they need to know about recycling because that’s what they’ve always known.” (Center for Sustainable Behavior & Impact, 2022)
More than seventy percent of people surveyed wish there was an easier way to get information on what can and can’t be recycled in their community. (Center for Sustainable Behavior & Impact, 2022)
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Determining the success of their outreach efforts is another challenge that Orange County jurisdictions are facing in the near future. Most jurisdictions need to determine how to measure outreach efforts, as the enforcement started January 1, 2024. Having common standards and methods to measure the success of public education and compliance, and regularly posting this information on the jurisdiction’s website related to SB 1383 goals, will give the public an incentive to comply with SB 1383. However, in the interim, there is a significant amount of visual evidence regarding the level of residents’ confusion as evidenced by the photo below. The photo is the amount of waste in the first five hours of a workday that was improperly included in residential recyclable containers and delivered to a MRF, where it had to be hand sorted out.

Figure 8: Waste improperly included in recyclable containers Photo: OCGJ • Procurement of Recovered Organic Waste Products
Representatives from most of the jurisdictions the OCGJ interviewed indicated that meeting the procurement requirements of SB 1383 is challenging. This is due to their jurisdictions’ State-calculated procurement targets far exceeding the quantity of recovered organic waste products that they can utilize.

To comply with SB 1383, jurisdictions must procure recovered organic waste products to meet an annual procurement target. Recovered organic waste products include:
o Compost
o Mulch
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o Renewable energy (transportation fuel, electricity, and gas for heating) from anaerobic digestion
o Electricity from biomass conversion
Each jurisdiction’s procurement target is calculated by multiplying its population, as reported by the California Department of Finance, by the per capita procurement target (0.08 tons of organic waste per California resident per year).

The resulting procurement target can then be multiplied by product conversion factors (as established by the regulations) to determine the annual procurement requirements for recovered organic waste products.

Source: CalRecycle
As one of the survey respondents stated:
“Meeting the annual procurement target presents a significant challenge. In addition, the formula used to calculate a jurisdiction’s procurement target does not account for density or square miles. Denser areas equal less space to distribute mulch or compost.

More people equals higher procurement target.”
As a result, a number of jurisdictions with high procurement targets had to use grant funding to purchase the required amounts of compost/mulch. Because the required target procurement amounts exceeded what they can utilize in their communities, they had to distribute the compost/mulch (via hauler) to agricultural communities outside Orange County. They also admitted that without grant funding, meeting the targets will be even more difficult and will require diverting resources from their own communities or raising rates.

The regulations limit procurement to “use or giveaway, and do not include the sale of products [14CCR Section 18993.1(e)(1)] so jurisdictions cannot sell the procured recovered organic waste products, such as compost, via a third party.” (CalRecycle, 2022)
Renewable Natural Gas (RNG) is one of the products that can be counted towards meeting a jurisdiction’s procurement goal. Haulers operating in Orange County, including Republic, CR&R, and Waste Management, utilize trucks powered by RNG.

However, in most cases the RNG they use is not purchased from an approved facility so it cannot be counted towards the required procurement goal. CalRecycle maintains a list of anaerobic digestion facilities in California to help jurisdictions find renewable gas that may be eligible towards their SB 1383 procurement obligations.

Currently, this list contains only six facilities that produce Compressed Natural Gas (CNG), which in this case is presumably compressed RNG. None of these facilities is located in Orange County. The closest are located in Riverside County (Perris), San Bernardino County (Victorville and Rialto), and San Diego County (Escondido).

The issue of RNG is further complicated by the fact that some sewage treatment plants also produce RNG, which (according to CalRecycle) is mostly ineligible. Below is the 368
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information included in “Frequently Asked Questions” on RNG on the CalRecycle website (CalRecycle, 2022):

Renewable gas derived solely from sewage is ineligible for meeting the procurement target because a Publicly Owned Treatment Work (POTW) is not a solid waste facility and therefore not in the scope of the legislative intent of SB 1383. Sewage is also not typically destined for a landfill, so its use does not help achieve the landfill diversion goals.

However, Title 14 explicitly authorizes POTWs to accept food waste without a solid waste facility permit, making it functionally similar to incentivizing biomethane from a solid waste facility. Therefore, it is justifiable to allow the portion of renewable gas resulting from the digestion of food waste at POTWs to count toward the procurement targets, provided the POTW accepts food waste from specified facilities or operations [see 14 CCR Section 18993.1(h)(1)] and meets all other applicable regulatory requirements. For more information, please see the Final Statement of Purpose and Necessity (pages 178-180).

The issue of procurement difficulties encountered by California jurisdictions is mentioned in the Little Hoover Commission 2023 report on the implementation of SB 1383. The Commission recommended that “the state should expand the list of compliance pathways and products eligible to count toward a jurisdiction’s procurement requirements.” (Little Hoover Commission, 2023)
• Coordination and Vision for the Future
In a county with thirty-four cities and several other jurisdictions, coordination, collaboration, and sharing resources and best practices can be a challenge. The OCGJ learned that county-wide groups meet on a regular basis, including a waste management coordinators’ group, a haulers’ group, and a market development group.

Additionally, the OCGJ learned that OCW&R has assumed a leadership role in positioning Orange County for a greener, more sustainable future.

OCW&R has a clear vision for a regional, county-wide approach to the implementation of SB 1383, which includes not only organics and edible food strategies, but also market creation and development, procurement and compliance, and regional standardization and collaboration.

The details of their vision are outlined in the 2024 presentation to the legislative group, which is available on the OCW&R website (OC Waste & Recycling, 2024).

The following slide has been taken from this presentation. 369
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Figure 9. Circular economy concept for Orange County Source: OCW&R • Other Issues
Multi-family housing units: While not within the scope of this report, it should be noted that services to multi-family units still pose a significant challenge. Jurisdictions are required to provide organic waste collection to multi-family units. Many find it difficult to provide a three-bin source-separated service to these units due to limited space.

Creative solutions, such as providing smaller organics containers or containers that are placed in a common area to serve multiple units, have been utilized by Orange County cities, but full compliance is difficult to achieve.

The cost of SB 1383 implementation: The Little Hoover Commission Report states that the gross cost of implementation was determined to be $40 billion between 2019 and 2030. (CalRecycle, 2019) “About 5 percent of this figure represents soft costs (i.e. the work local jurisdictions must do to create organic waste programs, educate the public, and ensure health, safety, and quality control measures are met). The other 95 percent represents the cost of disposing of organic waste, including constructing infrastructure” (Little Hoover Commission, 2023). Most Orange County jurisdictions interviewed by the OCGJ indicated that they had to increase their residential and/or business waste collection rates to cover the cost of expanded services mandated by SB 1383. 370
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COMMENDATIONS
• County of Orange, OC Waste & Recycling is commended for having successfully met SB 1383 mandates, developing new composting infrastructure, a model education and outreach program, moving towards robust and repurposing recycling programs, and developing gas-to-energy facilities to produce renewable energy.
• City of Mission Viejo, Solid Waste Program is commended for their proactive implementation of SB 1383 mandates, distributing compliant waste containers to all residents, and producing a robust outreach and education program using numerous delivery methods.

• City of Santa Ana Public Works, Trash and Recycling Program is commended for proactively revising their hauler contract to meet SB 1383 requirements, producing a notable and ongoing outreach and education program, distributing compliant waste containers to all residents, and fostering a highly collaborative relationship with their hauler.

FINDINGS
In accordance with California Penal Code Sections 933 and 933.05, the 2023-2024 Grand Jury requires responses from each agency affected by the findings presented in this section. The responses are to be submitted to the Presiding Judge of the Superior Court.

Based on its investigation titled “Talking Trash: Recyclables and Organic Waste,” the 2023-2024 Orange County Grand Jury has arrived at the following principal findings:

Container Standardization
F1. The majority of Orange County jurisdictions have not yet required their haulers to distribute residential containers that meet the CalRecycle standardized colors, leaving legacy and often incorrect or illegible labeling and embossing in place.

Funding and Enforcement
F2. While a jurisdiction may not delegate its overall responsibility for compliance with State requirements to a hauler, some jurisdictions have designated the task of imposing and collecting fines from residents to the hauler in accordance with State law. However, not all jurisdictions are clear on who ultimately receives and retains the collected fines.

F3. All jurisdictions will eventually start collecting fines from residents for noncompliance, but some have not yet determined whether the revenues will go into a waste and recycling enterprise fund or into the jurisdiction’s general fund. 371
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Education and Outreach
F4. In most jurisdictions, education and outreach is a joint effort between jurisdiction, hauler, and sometimes consultants, with the jurisdiction reviewing the materials before publication. The methods of dissemination vary by jurisdiction and hauler but frequently rely on a resident actively seeking the information, which requires the resident to have some awareness of the new mandates in the first place.

Most efforts primarily revolve around intermittent hard-copy paper mailings.

F5. Most jurisdictions currently have no way to accurately determine the effectiveness of their respective education and outreach efforts other than the eventual inspections or audits that will take place.

Procurement of Recovered Organic Waste Products
F6. There is some concern that there are not enough composting facilities in Orange County to process all organic waste, forcing some jurisdictions/haulers to transport it long distances for processing.

F7. There is currently no infrastructure in the county that is a State-approved source of Renewable Natural Gas (RNG) and energy from organic waste. Jurisdictions that use vehicles running on RNG procured from non-approved sources cannot count that RNG towards fulfillment of their procurement requirement.

F8. The formula used by the State to calculate a jurisdiction's procurement target does not account for a jurisdiction’s population density or geographic size (square miles). As such, meeting the annual procurement target presents a significant challenge for most jurisdictions.

F9. Many Orange County jurisdictions were unable to meet the requirement in SB 1383 to reduce organic waste sent to landfills by the 2020 deadline. It is unlikely the required seventy-five percent reduction will be achieved by the 2025 deadline.

F10. The current procurement requirements mandated by SB 1383 are unrealistic and likely unachievable by most jurisdictions.

RECOMMENDATIONS
In accordance with California Penal Code Sections 933 and 933.05, the 2023-2024 Grand Jury requires responses from each agency affected by the recommendations presented in this section. The responses are to be submitted to the Presiding Judge of the Superior Court.
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Based on its investigation titled “Talking Trash: Recyclables and Organic Waste,” the 2023-2024 Orange County Grand Jury makes the following recommendations:

Container Standardization
R1. All jurisdictions should expedite the acquisition and distribution of residential containers that meet the CalRecycle standardized colors. Additionally, until the compliant containers can be distributed, all jurisdictions should ensure the distribution of labeling for non-compliant containers that explain the current SB 1383 requirements applicable to their jurisdiction by June 30, 2025.

Funding and Enforcement
R2. By December 31, 2024, all jurisdictions should ensure their waste hauling agreements are in compliance with State statute so that haulers may be designated to perform certain required tasks but are not improperly delegated overall responsibility for compliance. Additionally, all jurisdictions should ensure that any fines collected by a hauler are forwarded to the jurisdiction.

R3. The OCGJ recommends that all jurisdictions utilize a dedicated waste and recycling enterprise fund for collection of fines for non-compliance with SB 1383 by December 31, 2024.

Education and Outreach
R4. By December 31, 2024, all jurisdictions should diversify the methods and media used for education and outreach to include, among others, various social media platforms, emails to residents, newspaper, television, flyer mailings, community events, and appearances at other public gatherings.

R5. By December 31, 2024, and in order to gauge the effectiveness of their education and outreach efforts, all jurisdictions should develop new methods to engage residents directly to help determine their awareness of the requirements associated with SB 1383, such as surveys, online quizzes, and door-to-door polling.

Procurement of Recovered Organic Waste Products
R6. By June 30, 2025, the OCGJ recommends that all jurisdictions participate in the OCW&R-led efforts to develop a coordinated county-wide approach to the organics recycling infrastructure and programs as well as procurement requirements associated with SB 1383, working towards creating circular economy as a long-term goal.
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R7. By December 31, 2024, the Orange County Board of Supervisors and all Orange County cities should lobby appropriate members of the State Legislature and/or CalRecycle to revise the organic waste diversion targets to better reflect Orange County’s waste amounts, revise the jurisdictions’ procurement requirements to better represent the limited options currently available for procurement, the jurisdictions’ varying populations, population densities, and geographic size, and to delay associated enforcement actions by the State.

RESPONSES
The following excerpts from the California Penal Code provide the requirements for public agencies to respond to the Findings and Recommendations of this Grand Jury report:

Section 933
(c) No later than 90 days after the grand jury submits a final report on the operations of any public agency subject to its reviewing authority, the governing body of the public agency shall comment to the presiding judge of the superior court on the findings and recommendations pertaining to matters under the control of the governing body, and every elected county officer or agency head for which the grand jury has responsibility pursuant to Section 914.1 shall comment within 60 days to the presiding judge of the superior court, with an information copy sent to the board of supervisors, on the findings and recommendations pertaining to matters under the control of that county officer or agency head and any agency or agencies which that officer or agency head supervises or controls. In any city and county, the mayor shall also comment on the findings and recommendations. All of these comments and reports shall forthwith be submitted to the presiding judge of the superior court who impaneled the grand jury. A copy of all responses to grand jury reports shall be placed on file with the clerk of the public agency and the office of the county clerk, or the mayor when applicable, and shall remain on file in those offices. One copy shall be placed on file with the applicable grand jury final report by, and in the control of the currently impaneled grand jury, where it shall be maintained for a minimum of five years.

Section 933.05.
(a) For purposes of subdivision (b) of Section 933, as to each grand jury finding, the responding person or entity shall indicate one of the following:
(1) The respondent agrees with the finding.
(2) The respondent disagrees wholly or partially with the finding, in which case the response shall specify the portion of the finding that is disputed and shall include an explanation of the reasons thereof.
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(b) For purposes of subdivision (b) of Section 933, as to each grand jury recommendation, the responding person or entity shall report one of the following actions:
(1) The recommendation has been implemented, with a summary regarding the implemented action.
(2) The recommendation has not yet been implemented, but will be implemented in the future, with a timeframe for implementation.
(3) The recommendation requires further analysis, with an explanation and the scope and parameters of an analysis or study, and a timeframe for the matter to be prepared for discussion by the officer or head of the agency or department being investigated or reviewed, including the governing body of the public agency when applicable. This timeframe shall not exceed six months from the date of publication of the grand jury report.
(4) The recommendation will not be implemented because it is not warranted or is not reasonable, with an explanation, thereof.

Responses Required
Comments to the Presiding Judge of the Superior Court in compliance with Penal Code Section 933.05 are required from:

Findings – 90 Day Response Required
OC Board of Supervisors: F1, F2, F3, F4, F5, F6, F7, F8, F9, F10 City Councils of:

Aliso Viejo F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Anaheim F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Brea F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Buena Park F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Costa Mesa F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Cypress F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Dana Point F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Fountain Valley F1, F2, F3, F4, F5, F6, F7, F8, F9, F10 Fullerton F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
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Garden Grove F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Huntington Beach F1, F2, F3, F4, F5, F6, F7, F8, F9, F10 Irvine F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
La Habra F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
La Palma F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Laguna Beach F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Laguna Hills F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Laguna Niguel F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Laguna Woods F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Lake Forest F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Los Alamitos F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Mission Viejo F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Newport Beach F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Orange F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Placentia F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Rancho Santa Margarita F1, F2, F3, F4, F5, F6, F7, F8, F9, F10 San Clemente F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
San Juan Capistrano F1, F2, F3, F4, F5, F6, F7, F8, F9, F10 Seal Beach F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Stanton F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Tustin F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Villa Park F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Westminster F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
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Yorba Linda F1, F2, F3, F4, F5, F6, F7, F8, F9, F10
Recommendations – 90 Day Response Required
OC Board of Supervisors: R1, R2, R3, R4, R5, R6, R7
City Councils of:

Aliso Viejo R1, R2, R3, R4, R5, R6, R7
Anaheim R1, R2, R3, R4, R5, R6, R7
Brea R1, R2, R3, R4, R5, R6, R7
Buena Park R1, R2, R3, R4, R5, R6, R7
Costa Mesa R1, R2, R3, R4, R5, R6, R7
Cypress R1, R2, R3, R4, R5, R6, R7
Dana Point R1, R2, R3, R4, R5, R6, R7
Fountain Valley R1, R2, R3, R4, R5, R6, R7
Fullerton R1, R2, R3, R4, R5, R6, R7
Garden Grove R1, R2, R3, R4, R5, R6, R7
Huntington Beach R1, R2, R3, R4, R5, R6, R7
Irvine R1, R2, R3, R4, R5, R6, R7
La Habra R1, R2, R3, R4, R5, R6, R7
La Palma R1, R2, R3, R4, R5, R6, R7
Laguna Beach R1, R2, R3, R4, R5, R6, R7
Laguna Hills R1, R2, R3, R4, R5, R6, R7
Laguna Niguel R1, R2, R3, R4, R5, R6, R7
Laguna Woods R1, R2, R3, R4, R5, R6, R7
Lake Forest R1, R2, R3, R4, R5, R6, R7
Los Alamitos R1, R2, R3, R4, R5, R6, R7
Mission Viejo R1, R2, R3, R4, R5, R6, R7
Newport Beach R1, R2, R3, R4, R5, R6, R7
Orange R1, R2, R3, R4, R5, R6, R7
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Placentia R1, R2, R3, R4, R5, R6, R7
Rancho Santa Margarita R1, R2, R3, R4, R5, R6, R7
San Clemente R1, R2, R3, R4, R5, R6, R7
San Juan Capistrano R1, R2, R3, R4, R5, R6, R7
Seal Beach R1, R2, R3, R4, R5, R6, R7
Stanton R1, R2, R3, R4, R5, R6, R7
Tustin R1, R2, R3, R4, R5, R6, R7
Villa Park R1, R2, R3, R4, R5, R6, R7
Westminster R1, R2, R3, R4, R5, R6, R7
Yorba Linda R1, R2, R3, R4, R5, R6, R7

REFERENCES
California Air Resources Board. (2024). Short-Lived Climate Pollutants. Retrieved from https://ww2.arb.ca.gov/our-work/programs/slcp/about
CalRecycle. (2019, October 2). Initial Statement of Reasons Appendix A: Cost Update.

Retrieved from CalRecycle: https://www2.calrecycle.ca.gov/Docs/Web/115980 CalRecycle. (2022, December 5). Procurement Questions and Answers. Retrieved from CalRecycle: https://calrecycle.ca.gov/organics/slcp/faq/recycledproducts / CalRecycle. (2023). SB1383 Education and Outreach Resources. Retrieved from CalRecicle: https://calrecycle.ca.gov/organics/slcp/education/ CalRecycle. (2024). 2022 State of Disposal and Recycling Report. Sacramento:

Department of Resources Recycling and Recovery (CalRecycle). Retrieved from https://www2.calrecycle.ca.gov/Publications/Details/1732 CalRecycle. (2024). Enforcement Questions and Answers. Retrieved from https://calrecycle.ca.gov/organics/slcp/faq/enforcement/ CalRecycle. (2024). SB 1383 Education and Outreach Resources. Retrieved from https://calrecycle.ca.gov/organics/slcp/education/
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Center for Sustainable Behavior & Impact. (2022). Consumer Insights on Packaging, Labels, and Claims for Recycling. The Recycling Partnership. Retrieved from https://recyclingpartnership.org/wpcontent/uploads/dlm_uploads/2023/06/Consumer_Labeling_Research_Final.pdf Christian Blanco, C. S. (2023, May 30). America's Broken Recycling System. Retrieved from California Management Review : https://cmr.berkeley.edu/2023/05/americas-broken-recycling-system/ Christian Blanco, C. S. (2023, May 30). Is it Time to Consider a National Recycling Standard? California Management Review. Retrieved from
https://cmr.berkeley.edu/2023/05/is-it-time-to-consider-a-national-recyclingstandard / Little Hoover Commission. (2023). Reducing California's Landfill Methane Emissions:

SB1383 Implementation. Sacramento: Little Hoover Commission.

Mouchard, A. (2024, May 4). Tech meets trash in Orange County’s landfill future.

Orange County Register. Retrieved from
https://www.ocregister.com/2024/05/04/tech-meets-trash-in-orange-countyslandfill-future/ OC Waste & Recycling. (2024). OCW&R. Retrieved from OCW&R:
https://oclandfills.com/sites/ocwr/files/2024-
03/1383%20IMAGINE%20WHAT%20CAN%20BE%20Presentaiton.pdf
Recycling Inside. (2023, June 2). Revolutionizing Recycling: The Relevance of Artificial Intelligence in the Recycling Industry. Retrieved from
https://recyclinginside.com/the-relevance-of-artificial-intelligence-in-the-recyclingindustry/ Savage, S. (2023, February 16). Forbes. Retrieved from
https://www.forbes.com/sites/stevensavage/2023/02/16/the-golden-statescircular-economy-goals-is-that-just-california-dreamin-or-thefuture/?sh=95c357338e58

GLOSSARY
AB Assembly Bill
CalRecycle California Department of Resources Recycling and Recovery 379
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2023-2024 Orange County Grand Jury Page 27
Circular Economy Current economic models consist of acquiring materials, making them into products, and then those products become waste. A circular economy reduces material use, redesigns materials and products to be less resource intensive, and recaptures “waste” as a resource to manufacture new materials and products.

Compost Compost is made from a variety of organic materials and is used to add nutrients and improve soil structure by mixing it into the soil.

Mulch Mulch is typically made from a single material like straw, grass clippings, or wood chips and is spread on top of the soil to suppress weeds, retain moisture, regulate soil temperature, and protect plant roots.

MRF Material Recovery Facility
OCGJ Orange County Grand Jury
OCW&R OC Waste & Recycling, a department of the County of Orange Organic Waste Solid wastes originated from living organisms and their metabolic waste products, and from petroleum, which contain naturally produced organic compounds, and which are biologically
decomposable by microbial and fungal action into the constituent compounds of water, carbon dioxide, and other simpler organic compounds. Sometimes called biodegradable waste.

ORNGE Organics to Natural Gas and Energy
POTW Publicly Owned Treatment Work
Recycling Using waste as material to manufacture a new product. Recycling involves altering the physical form of an object or material and making a new object from the altered material.

RNG Renewable Natural Gas
SB Senate Bill
SLCP Short-Lived Climate Pollutants
Solid Waste Discarded or abandoned materials. Solid wastes can be solid, liquid, semi-solid or containerized gaseous material.

Waste Objects or materials for which no use or reuse is intended. 380
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APPENDICES
APPENDIX A – SURVEY RESULTS
Survey participants were asked to mark their progress on a scale from 1 (significant challenges) to 5 (excellent progress) for each of the nine questions. On the following bar graphs, the ‘x’ axis (horizontal) depicts the rating scale from 1 to 5. The ‘y’ axis (vertical) represents the number of respondents that gave themselves a particular rating.

Was your city successful in meeting the goal of reducing organic waste disposal 50% by 2020?
Are you confident that your city will meet the goal of reducing organic waste 75% by 2025?
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How would you rate your city's success in providing organic waste collection services to all residents?
How successful is your city in recycling these organic materials? How would you rate your confidence that city residents have been educated to have sufficient knowledge of the composting requirements (and associated restrictions) with the proper disposal of yard trimmings and food scraps?
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How successful was your city in procuring a quantity of recovered organic waste products annually?
How would you rate your city's success in meeting the record-keeping requirements associated with SB1383, including but not limited to, inspection and enforcement, compliance reviews, investigation of complaints, and alleged violations? How satisfied are you that your current agreements(s) with the hauler(s) that service your city are adequate to comply with all provisions of residential services required by SB1383?
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Are your city's current staffing levels that are, or will become, responsible for all aspects of full SB1383 compliance adequate to meet the tasks at hand? The following examples of additional comments or explanations for their answers to the questions above were provided by survey respondents:
“Comprehensive implementation and effective management of SB 1383 would require additional resources and financial support. Despite our [jurisdiction’s] proactive approach, including securing a new hauler/franchise agreement . . . that aligns with SB 1383's requirements and achieving near-complete adoption of these guidelines, there remains a widespread reluctance towards organic recycling. Ongoing educational efforts are in place and will continue; however, achieving significant behavioral change and compliance will require additional resources.”
“[Our jurisdiction has] been working on compliance regarding SB 1383 with new franchise agreements, building out local infrastructure, meeting the SB 619 procurement targets, providing education and outreach, programs are being implemented to incrementally improve participation and increase diversion. We are increasing staffing levels to help with continued support for compliance as it requires increased effort for more inspections, waste characterizations, more education and outreach, further program development, market creation and development for compost and mulch, inspections, education, and enforcement support. Although meeting the 75% goal requires more heavy lifting, I anticipate we will see incremental improvements from our efforts.”
“SB 1383 has proven to challenge the recycling habits of many throughout the [jurisdiction]. Through updated franchise agreements . . . and CalRecycle grant funding, we have been able to educate and encourage change in disposal habits as required via SB 1383. Additional outreach outlining the requirements and benefits of recycling organic material will be key in successfully transitioning residents and business owners to recycle organic material.”
“[We] started a new franchise agreement after an RFP process . . . . This allowed us to incorporate all hauler-related SB 1383 compliance activities and select an innovative 384
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organic waste collection program. We are facing procurement challenges as energy related products are not readily available (particularly) RNG for collection vehicles.

Staffing may prove to be a challenge, depending upon the amount of complaints, inspections, and enforcement actions we are required to address.” “Procurement [is our] biggest challenge.”
“Our agreement with [the hauler] required that they implement 1383 compliant programming immediately for residential. It also includes education/outreach, contamination monitoring, purchase or compost/mulch on our behalf. Residential 3-cart was implemented on day one of the agreement. However, even with education, residents are hesitant to participate with food in the organics container due to not being allowed to use compostable bags and therefore attracting bugs and vermin.” “Meeting the annual procurement target presents a significant challenge. [The hauler’s] collection trucks are fueled with RNG. The RNG purchased is California produced, though not SB 1383 qualified. In addition, the formula used to calculate a jurisdiction’s procurement target does not count for density or square miles. Denser areas equal less space to distribute mulch or compost. More people equals higher procurement target.” “As with any new program where you need to change habits and behavior, it is going to a long-term project to get adults in the habit of separating their food scraps. State of CA should implement a statewide outreach campaign, and not just rely on local jurisdictions to provide all the outreach.”
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APPENDIX B – CIRCULAR ECONOMY STARTS IN YOUR KITCHEN

Circular conomy at or
386
Attachment 2
RESOLUTION NO. 24-134

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SAN CLEMENTE, CALIFORNIA, APPROVING RESPONSE

TO FINDINGS AND RECOMMENDATIONS IN THE
REPORT OF THE ORANGE COUNTY GRAND JURY –
“TALKING TRASH: RECYCLABLES AND ORGANIC
WASTE”
WHEREAS, on June 11, 2024, the 2023-2024 Orange County Grand Jury report, “Talking Trash: Recyclables and Organic Waste” was published; and WHEREAS, the report focused on requirements established by Senate Bill (SB) 1383 and challenges cities have in meeting established goals for diversion and procurement; and
WHEREAS, California Penal Code Section 933 requires the City to provide a response to each of the findings and recommendations in the report; and WHEREAS, California Penal Code Section 933.05 specifies the manner in which the responses and comments on the findings and recommendations are to be made; and WHEREAS, the City values the opportunity to respond to the report, share our perspective, and provide firsthand knowledge to each of the issues requested by the Grand Jury; and
WHEREAS, the responses must be submitted to the Presiding Judge of the Superior Court by September 8, 2024; and
WHEREAS, the City Council has reviewed the report.

NOW, THEREFORE, the City Council of the City of San Clemente does hereby find, determine and resolve as follows:

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

SECTION 2. That the Mayor is authorized and directed to respond to the findings and recommendations noted in the report by submitting a letter to the Presiding Judge of the Superior Court by September 8, 2024 in substantially the same form as attached to this Resolution as Exhibit A, which is incorporated fully herein by this reference, and which response is approved.

SECTION 3. 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 _____ day of August, 2024.
387
Resolution No. 24-134 Page 2
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. 24-134 was adopted at a regular meeting of the City Council of the City of San Clemente held on the _______ day of August, 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 August, 2024. __________________________
CITY CLERK of the City of
San Clemente, California
Approved as to form:
___________________________
Elizabeth A. Mitchell, City Attorney
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City Council 910 Calle Negocio, San Clemente, CA 92673
http://san-clemente.org
Exhibit A
August 21, 2024
The Honorable Michael J. Verrengia,
Presiding Judge of the Superior Court
Orange County Grand Jury
700 Civic Center Drive West
Santa Ana, CA 92701
Subject: Report of the Orange County Grand Jury - “Talking Trash: Recyclables and Organic Waste”
Dear Presiding Judge Verrengia,
The City of San Clemente (City) appreciates the time and effort the Grand Jury spent on the development of their report, “Talking Trash: Recyclables and Organic Waste.” The City Council has reviewed the report and authorized the attached response to the findings and recommendations noted in the report. The City values the opportunity to respond to the report, share our perspective, and provide firsthand knowledge to each of the issues requested by the Grand Jury.

If the City of San Clemente can provide additional information or clarification of our response, please do not hesitate to contact City Manager Andy Hall at HallA@sanclemente.org.

Sincerely,
Victor Cabral,
Mayor, City of San Clemente
Enclosure: City of San Clemente’s Response to Findings and Recommendations CC: City of San Clemente Council Members
Andy Hall, City Manager

CITY OF SAN CLEMENTE

OFFICE OF THE MAYOR

Victor Cabral
Mayor
(949) 361-8322
[email protected] THE SPANISH VILLAGE BY THE SEA 389
City Council 910 Calle Negocio, San Clemente, CA 92673
http://san-clemente.org
Exhibit A
The City of San Clemente’s responses to findings and recommendations in the 2023- 2024 Orange County Grand Jury " Talking Trash: Recyclables and Organic Waste" Report are as follows:

Findings and Responses
Container Standardization
F1 The majority of Orange County jurisdictions have not yet required their haulers to distribute residential containers that meet the CalRecycle standardized colors, leaving legacy and often incorrect or illegible labeling and embossing in place.

City Response:

Agree based on the grand jury report, but the City of San Clemente has limited knowledge of other cities solid waste and recycling contracts. In addition, it may be challenging for compliance since there have there have been supply chain issues with obtaining new containers according to the City’s hauler.

Funding and Enforcement
F2 While a jurisdiction may not delegate its overall responsibility for compliance with State requirements to a hauler, some jurisdictions have designated the task of imposing and collecting fines from residents to the hauler in accordance with State law. However, not all jurisdictions are clear on who ultimately receives and retains the collected fines.

City Response:

Agree based on the grand jury report, but the City of San Clemente has limited knowledge of other cities solid waste and recycling contracts. However, the City of San Clemente collects and retains any fines imposed on customers related to compliance.

F3 All jurisdictions will eventually start collecting fines from residents for noncompliance, but some have not yet determined whether the revenues will go into a waste and recycling enterprise fund or into the jurisdiction’s general fund.

City Response:

Agree based on the grand jury report, but the City of San Clemente has limited knowledge of what other cities are doing with collected fines or their intentions.

However, the City of San Clemente fines go directly into the City’s solid waste and recycling enterprise fund.

Education and Outreach
F4 In most jurisdictions, education and outreach is a joint effort between jurisdiction, hauler, and sometimes consultants, with the jurisdiction reviewing the materials before publication. The methods of dissemination vary by jurisdiction and hauler but frequently rely on a resident actively seeking the information, which requires the resident to have some awareness of the new mandates in the first place. Most efforts primarily revolve around intermittent hard-copy paper mailings.
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City Council 910 Calle Negocio, San Clemente, CA 92673
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Exhibit A
City Response:

Agree; however, the City of San Clemente has not conducted an independent survey to confirm this finding.

F5 Most jurisdictions currently have no way to accurately determine the effectiveness of their respective education and outreach efforts other than the eventual inspections or audits that will take place.

City Response:

Agree; however, the City of San Clemente has not conducted an independent survey to confirm this finding for jurisdictions.

Procurement of Recovered Organic Waste Products
F6 There is some concern that there are not enough composting facilities in Orange County to process all organic waste, forcing some jurisdictions/haulers to transport it long distances for processing.

City Response:

Agree; the City of San Clemente’s organic waste is transported to Perris, CA for processing.

F7 There is currently no infrastructure in the county that is a State-approved source of Renewable Natural Gas (RNG) and energy from organic waste. Jurisdictions that use vehicles running on RNG procured from non-approved sources cannot count that RNG towards fulfillment of their procurement requirement.

City Response:

Disagrees Partially because the City of San Clemente has limited knowledge or RNG infrastructure. However, the City of San Clemente’s hauler is producing RNG from the City’s organic waste in Perris, CA and diverting the RNG to Edison. In return, the hauler receives credits toward RNG fueling stations throughout the state.

F8 The formula used by the State to calculate a jurisdiction's procurement target does not account for a jurisdiction’s population density or geographic size (square miles). As such, meeting the annual procurement target presents a significant challenge for most jurisdictions.

City Response:

Agree.
391
City Council 910 Calle Negocio, San Clemente, CA 92673
http://san-clemente.org
Exhibit A
F9 Many Orange County jurisdictions were unable to meet the requirement in SB 1383 to reduce organic waste sent to landfills by the 2020 deadline. It is unlikely the required seventy-five percent reduction will be achieved by the 2025 deadline.

City Response:

Agree; however, the City of San Clemente is currently diverting seventy one percent and believes seventy five percent is achievable with the addition of multifamily organic waste diversions.

F10 The current procurement requirements mandated by SB 1383 are unrealistic and likely unachievable by most jurisdictions.

City Response:

Agree; however, the City of San Clemente has not conducted an independent survey to confirm this finding.

Recommendations and Responses
Container Standardization
R1 All jurisdictions should expedite the acquisition and distribution of residential containers that meet the CalRecycle standardized colors. Additionally, until the compliant containers can be distributed, all jurisdictions should ensure the distribution of labeling for non-compliant containers that explain the current SB1383 requirements applicable to their jurisdictions by June 30, 2025.

City Response:

The recommendation has been partially implemented and will be fully implemented prior to the SB 1383 regulations by 2036. The City of San Clemente has implemented the three-cart system with co-collected organics over a decade ago. The City’s hauler provided standardized color-coded carts with labeling at the time and continue to see positive participation. If a customer requests an exchange of bins, they will be delivered with the new SB 1383 compliant carts. In addition to the carts, the City and hauler provide quarterly outreach and educational material to residents regarding how to properly sort their material and details regarding available and mandated programs.

Funding and Enforcement
R2 By December 31, 2024, all jurisdictions should ensure their waste hauling agreements are in compliance with State statute so that haulers may be designated to perform certain required tasks but are not improperly delegated overall responsibility for compliance. Additionally, all jurisdictions should ensure that any fines collected by a hauler are forwarded to the jurisdiction. 392
City Council 910 Calle Negocio, San Clemente, CA 92673
http://san-clemente.org
Exhibit A
City Response:

The recommendation has been partially implemented and will be fully implemented prior to December 31, 2024. The City is in process of revising its Solid Waste and Recycling Contract, however, the City of San Clemente currently has the responsibility for enforcement.

R3 The OCGJ recommends that all jurisdictions utilize a dedicated waste and recycling enterprise fund for collection of fines for non-compliance with SB 1383 by December 31, 2024.

City Response:

The recommendation has been implemented; the City of San Clemente has a dedicated enterprise fund for Solid Waste and Recycling that includes a revenue source for fines.

Education and Outreach
R4 By December 31, 2024, all jurisdictions should diversify the methods and media used for education and outreach to include, among others, various social media platforms, emails to residents, newspaper, television, flyer mailings, community events, and appearances at other public gatherings.

City Response:

The recommendation has been implemented; the City of San Clemente and its Solid Waste and Recycling Contractor utilize a variety of formats to provide education and outreach, including, quarterly mailings, community events and appearances at social gatherings. In addition, the City of San Clemente recently received training and is improving its use of social media platforms to provide more information through short video formats.

R5 By December 31, 2024, and in order to gauge the effectiveness of their education and outreach efforts, all jurisdictions should develop new methods to engage residents directly to help determine their awareness of the requirements associated with SB 1383, such as surveys, online quizzes, and door-to-door polling.

City Response:

The recommendation has been implemented, the City of San Clemente and its Solid Waste and Recycling Contractor utilize a variety of formats to provide feedback at special events and through surveys. The City will continue to make improvements to its education and outreach efforts and to gauge customer awareness.

R6 By June 30, 2025, the OCGJ recommends that all jurisdictions participate in the OCW&R-led efforts to develop a coordinated county-wide approach to the organics recycling infrastructure and programs as well as procurement requirements 393
City Council 910 Calle Negocio, San Clemente, CA 92673
http://san-clemente.org
Exhibit A
associated with SB 1383, working towards creating circular economy as a long-term goal.

City Response:

The recommendation has not yet been implemented, but will be implemented based on the time frame determined by OCW&R. The city will participate in supporting the recommendation with OCW&R.

R7 By December 31, 2024, the Orange County Board of Supervisors and all Orange County cities should lobby appropriate members of the State Legislature and/or CalRecycle to revise the organic waste diversion targets to better reflect Orange County’s waste amounts, revise the jurisdictions’ procurement requirements to better represent the limited options currently available for procurement, the jurisdictions’ varying populations, population densities, and geographic size, and to delay associated enforcement actions by the State.

City Response:

The recommendation has not yet been implemented, but will be implemented with coordination between the Orange County Board of Supervisors and agreement between the Orange County Cities. The city will support the recommendation to the extent the coordinated effort is acceptable to the Orange County Board of Supervisors and cities by June 30, 2025. 394
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 1
Meeting Date: August 20, 2024 Agenda Item: 11J.

Submitted By: Public Works
Prepared By: David Rebensdorf, Public Works Director/City Engineer Subject:
..titl e
RESPONSE TO 2023-2024 ORANGE COUNTY GRAND JURY REPORT “EMERGING OPPORTUNITIES IN SOUTH COUNTY WATER/WASTEWATER SYSTEMS” ..body Fiscal Impact:

None at this time.

Summary:

On June 21, 2024, the 2023-2024 Orange County Grand Jury report, “Emerging Opportunities in South County Water/Wastewater Systems” was published. The report focuses on the 2021 consolidation of the City of San Juan Capistrano’s (SJC) water and wastewater utilities with Santa Margarita Water District (SMWD) and how rate structure changes affected rate payers (lessons learned for future consolidations), and challenges associated with differing interests amongst South Orange County Wastewater Authority’s (SOCWA) member agencies related to the future operation of the agency as agreements expire. The Grand Jury requires a response from the City on two Findings and one Recommendation in the report, and the responses must be submitted to the Presiding Judge of the Superior Court by September 19, 2024.

Background:

The 2023-2024 Orange County Grand Jury report, “Emerging Opportunities in South County Water/Wastewater Systems” is provided as Attachment 1. The report studies the consolidation of SJC into SMWD and challenges with varying interests in the future operation, maintenance and repurposing of SOCWA wastewater as existing agreements expire. In addition, the report studies benefits and challenges from consolidation of agencies along with suggested improvements, such as, evaluating rate structure and potential impacts to customer rates.

The report identifies four Findings and two Recommendations (p. 22 of 33 of the report).

California Penal Code Section 933 requires the City to provide a response to two Findings and one Recommendation in the report. California Penal Code Section 933.05 specifies the exact manner in which the responses and comments on the Findings and Recommendations are to be made.

The responses must be submitted to the Presiding Judge of the Superior Court by September 19, 2024. Staff has prepared draft responses below for the City Council’s consideration. The proposed responses are based on staff’s knowledge and experience in water and wastewater. 395
Meeting Date: August 20, 2024 Agenda Item: 11J.

CITY OF SAN CLEMENTE 2
Findings
In accordance with California Penal Code Sections 933 and 933.05, the 2023-2024 Grand Jury requires responses from each agency affected by the findings. Based on its investigation titled "Emerging Opportunities in South County Water/Wastewater Systems," the 2023-2024 Orange County Grand Jury has arrived at four principal findings. Below are the Findings and proposed responses:

F1 San Juan Capistrano’s deferred maintenance of the water/wastewater utility resulted in the need to transition the facility to a larger water provider to all more efficient management and maintenance of the infrastructure.

Staff Recommended Response:

No response is required from the City of San Clemente.

F2 The SMWD proposed rate increase severely impacted San Juan Capistrano’s non-residential customers and led to protests of unfairness and negative attention from the local media.

Staff Recommended Response:

No response is required from the City of San Clemente.

F3 SOCWA’s member agencies have widely diverse populations, requirements, and revenues.

This has led to conflicts over governance, facility operation, and control, affecting the evolving potential for wastewater reuse.

Staff Recommended Response:

Agree.

F4 There is currently no unified strategy for the future of water/wastewater provision in South Orange County.

Staff Recommended Response:

The City of San Clemente disagrees partially with this finding. In general, most agencies are planning to have supply reliability in the event of a 60-day water outage as recommended by Metropolitan Water District. South Orange County is highly reliant on imported water and historically agencies have worked collaboratively to make regional improvements to supply reliability through participation in projects, such as, Irvine Water District Interconnection to the Joint Regional Water Supply System for emergency use, Baker Treatment Plant, and Upper Chiquita Reservoir to name a few. There are other regional projects currently being planned to lower south county demand for imported water, such as, addition recycled water system expansion, interconnection/supply of recycled water to neighboring agencies, Cadiz, Doheny Desalination, and direct and indirect potable water reuse. While there is no one size fits all approach for the region, each agency evaluates its needs, resources, impacts to operating costs to implement and maintain projects, and future rate impacts to its customers.

With regard to wastewater, there are differing opinions and needs amongst the agencies regarding governance, operation, and reuse of wastewater. There is one common goal 396
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CITY OF SAN CLEMENTE 3
related to the continued operation and maintenance of the Aliso Creek and San Juan Creek Ocean Outfalls since they are needed by all south county agencies. Some agencies will have minimal to possibly no discharge to the ocean outfalls when their systems are functioning properly and during dry weather. There will continue to be a need for maintenance and use of the outfalls during plant outages, maintenance of the reuse systems, and during periods of wet weather.

Recommendations
In accordance with California Penal Code Sections 933 and 933.05, the 2023-2024 Grand Jury requires responses from each agency affected by the recommendations presented in this section.

The Grand Jury recommendations and proposed responses are set forth below.

R1 The OCGJ recommends that by January 1, 2025, LAFCO studies a policy of conducting a post-consolidation agency review to be held within 24 months of agency reorganizations to determine their overall impact to the Public.

Staff Recommended Response:

No response is required by the City of San Clemente.

R2 The OCGJ recommends that by January 1, 2025, LAFCO form a task force comprising representatives of affected water agencies to study the transformation of SOCWA and prepare a report on the future of the water/wastewater in South Orange County.

Staff Recommended Response:

The recommendation will not be implemented by the City of San Clemente because the recommendation is for another agency (LAFCO) to perform a study and prepare a report. If a task force is formed with representatives of affected water agencies regarding the transformation of SOCWA, the City of San Clemente will participate in the process.

Council Options:
 Adopt Resolution No. 24-135, approving the staff-recommended responses to the 2023-2024 Orange County Grand Jury report, “Emerging Opportunities in South County Water/Wastewater Systems.”
 Modify and adopt Resolution No. 24-135 by making modifications to the staff-recommended responses to the 2023-2024 Orange County Grand Jury report, “Emerging Opportunities in South County Water/Wastewater Systems” and approve such responses as modified.  Continue the item and provide staff with alternative direction.

Environmental Review/Analysis:

The proposed action is not a “project” pursuant to California Environmental Quality Act Guidelines Sections 15378. (14 CCR § 15378.)
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Recommended Actions:

Staff Recommendation
..recommendation
Adopt Resolution No. 24-135, entitled: “A RESOLUTION OF THE CITY COUNCIL OF THE CITY

OF SAN CLEMENTE, CALIFORNIA, APPROVING RESPONSE TO FINDINGS AND RECOMMENDATIONS IN THE REPORT OF THE ORANGE COUNTY GRAND JURY – ‘EMERGING OPPORTUNITIES IN SOUTH COUNTY WATER/WASTEWATER SYSTEMS’”, and authorizing and directing the Mayor to respond to the findings and recommendations noted in the report by submitting a letter to the Presiding Judge of the Superior Court by September 19, 2024 in substantially the same form as that attached to the Resolution as Exhibit A. ..end
Attachment:

1. 2023-2024 Orange County Grand Jury report, “Emerging Opportunities in South County Water/Wastewater Systems”

2. Proposed Resolution No. 24-135, with Exhibit A - City of San Clemente’s Response to Findings and Recommendations of the 2023-2024 Orange County Grand Jury report, “Emerging Opportunities in South County Water/Wastewater Systems” Notification:

None.
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Attachment 1
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TABLE OF CONTENTS
SUMMARY...................................................................................................................... 3 BACKGROUND.............................................................................................................. 3 REASON FOR THE STUDY........................................................................................... 7 METHOD OF STUDY...................................................................................................... 7 INVESTIGATION AND ANALYSIS................................................................................. 9 WATER SYSTEMS – THE CONSOLIDATION PROCESS......................................... 9 Case Study: City of San Juan Capistrano and Santa Margarita Water District......... 9 LAFCO’s Regulatory Role: Municipal Service Reviews ............................................ 9 Summation ............................................................................................................. 13 WASTEWATER SYSTEMS - REGIONAL COLLABORATION ................................ 13 Case Study: South Orange County Wastewater Authority (SOCWA)..................... 13 Joint Power Authority: Governing Structure............................................................ 15 SOCWA: Disputes and Succession........................................................................ 16 Summation ............................................................................................................. 18 THE PATH FORWARD ............................................................................................. 19 COMMENDATIONS...................................................................................................... 21 FINDINGS..................................................................................................................... 22 RECOMMENDATIONS................................................................................................. 22 RESPONSES................................................................................................................ 23 Responses Required ............................................................................................... 24 REFERENCES.............................................................................................................. 25 GLOSSARY.................................................................................................................. 29 APPENDICES............................................................................................................... 31 APPENDIX 1.............................................................................................................. 31 South Orange County Water Resource Agencies................................................... 31 APPENDIX 2.............................................................................................................. 32 South Orange County Water Resource Agencies Summary Data.......................... 32 APPENDIX 3.............................................................................................................. 33 South Orange County Water Districts/Providers..................................................... 33 400
Emerging Opportunities in South County Water/Wastewater Systems 2023-2024 Orange County Grand Jury Page 3

SUMMARY
This Orange County Grand Jury (OCGJ) report examines the 2021 consolidation of the City of San Juan Capistrano’s (SJC) water and wastewater utilities with the Santa Margarita Water District (SMWD). It sheds light on the challenges encountered and benefits achieved through consolidation. The reorganization revealed unforeseen infrastructure costs. Also, different rate structures between the combined systems resulted in a dramatic fire line service rate increase for non-residential customers that prompted protest from some of the affected ratepayers. Going forward, the lessons learned from the SMWD experience are relevant for future consolidations. Based on the findings presented in this report, the OCGJ recommends that the Orange County Local Agency Formation Commission (LAFCO) develop an ongoing practice of evaluating post-consolidation outcomes and public impacts.

Further, this OCGJ report delves into the interrelationship of water and wastewater in South Orange County. The OCGJ studied the South Orange County Wastewater Authority (SOCWA), one of the largest collaborations of wastewater service providers in the region. Disputes among its member agencies, including litigation, have strained relations causing a bureaucratic entanglement that hinders operational effectiveness.

Proposals and negotiations are underway that could ultimately affect the status of its members and the realignment of treatment plants serving South Orange County.

SOCWA is a long-standing joint powers authority (JPA) that shares several wastewater facilities managed through agreements that are due to expire in 2030. Its continuance as a JPA is tenuous yet its regulatory function remains relevant. As such, the OCGJ recommends LAFCO form a task force comprising representatives from affected water agencies to study the transformation of SOCWA and prepare a report identifying the optimal future of water and wastewater systems in South Orange County.

Technologies, innovation, and increased State and federal funding are on the horizon for the water and resource recovery industry. The OCGJ finds an urgent need to unite the South Orange County water and wastewater agencies so that South Orange County is in a better position to seize the opportunities that lie ahead.

BACKGROUND
Providing water and processing wastewater in Orange County has consistently captured the public’s attention. Over the past 25 years, Grand Juries have issued 15 reports addressing various water-related challenges. Many of these reports emphasize the importance of consolidating water and wastewater agencies. Orange County is home to numerous governmental entities, including special districts and JPAs that oversee an array of countywide functions, particularly those related to water and wastewater service 401
Emerging Opportunities in South County Water/Wastewater Systems 2023-2024 Orange County Grand Jury Page 4
providers. Specifically, there are 29 retail water suppliers1in Orange County with their own independent governing boards and associated bureaucracies.

Previous OCGJs have raised concerns about the redundancy, laden costs, and complexity of public agencies for decades. Reports investigated the intricate web of independent special districts. Consolidating the large number of public agencies overseeing water and wastewater systems is a matter of significant concern. 2 Over the past six decades, Orange County’s history reflects a transformation from an agricultural hub to a thriving residential and commercial community. Rapid growth during this period caused a proliferation of water districts throughout the county. This resulted in an overabundance of water retailers operating within one of the geographically smallest counties in California.

In more recent times, water districts have found it necessary and advantageous to consolidate with other compatible public agencies. The Irvine Ranch Water District (IRWD) successfully acquired 5 water agencies in the last 27 years, with the most recent consolidation occurring in 2008.
3 The latest annexation within Orange County
occurred in 2021 when the Santa Margarita Water District (SMWD) acquired the water and wastewater systems of the City of San Juan Capistrano (SJC) through annexation.

Additionally, the potential consolidation of Orange County Water District (OCWD) and Municipal Water District of Orange County (MWDOC)—the county’s two major water wholesalers—is currently under review by the Orange County LAFCO. This is highlighted in the 2021-2022 OCGJ report titled “Water in Orange County Needs One Voice.”4
Advancing technology has made wastewater a sought-after commodity essentially adding to the water supply. In the realm of Orange County wastewater, there are two main wastewater service providers: the Orange County Sanitation District (OCSAN) and SOCWA. Both handle regional wastewater collection and treatment within their respective areas. Despite providing similar services, they operate under different governance structures. OCSAN is a special district, while SOCWA operates as a JPA.

OCSAN serves 25 agencies covering north and central Orange County, totaling 2.5 million residents, while SOCWA currently represents 7 water and sewer agencies in South Orange County, serving approximately 600,000 residents. (See figures 1 and 2) 1 Retail water suppliers provide potable municipal water to more than 3,000 end users or supply more than 3,000 acre-feet of potable water annually at retail for municipal purposes. (Cal. Water Code § 10608.12.)
2 2011-2012 Orange County Grand Jury report titled “Dragging Special Districts from The Shadows” 3 Consolidations (irwd.com)
4 2021-2022 Orange County Grand Jury report titled “Water in Orange County Needs One Voice” https://www.ocgrandjury.org/sites/jury/files/2023-06/2022-06- 22_Water_in_Orange_County_Needs_One_Voice.pdf
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Orange County Wastewater Agencies
Figure 1-Wastewater Agencies

OCSAN SOCWA
Services Regional wastewater
collection and treatment
Regional wastewater
collection and treatment
Governing Structure Special District JPA
Agencies Served 25 agencies covering North
and Central Orange County
7 water and wastewater
agencies covering South
Orange County
Funding Property taxes, utility bills,
grants and loans
Directly from member
agencies. (no taxing
authority)
# Residents Served ~2.5 million ~600,000
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Water Agencies in South Orange County
Figure 2 Courtesy of SOCWA
Note: Santa Margarita Water District annexed the City of San Juan Capistrano Utilities in 2021. Laguna Beach County Water District serves the City of Laguna Beach and the Emerald Bay Service District.
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REASON FOR THE STUDY
The public is generally unaware of the intricate processes and unseen operators who control the flow of their household water and sewage. However, the public has recently become keenly aware of rising utility bills. Media coverage has highlighted various water agencies raising rates to address escalating water costs, aging infrastructure, lack of upgrades, and deferred maintenance. The condition of water and wastewater infrastructure must be regularly assessed for an effective capital improvement program to maintain optimum performance.5 A recent example is the proactive April 16, 2024 “Huntington Beach Water/Wastewater Rate Report” proposal needed to ensure reliable water and wastewater systems through 2040.
6 Over the past few years, several water
agencies across Orange County have faced backlash from ratepayers for massive hikes to cover such expenses.

In 2023, public attention was drawn to the aftermath of the SMWD’s 2021 annexation of the SJC water systems. Media reports cited SMWD officials claiming neglect under prior SJC management. News coverage also focused on proposed rate increases so excessive that they generated protests from some of the most severely impacted customers. This being the most recent water systems consolidation, OCGJ was curious about the overall process, pre-existing condition of city’s water systems, and reasons underlying these major rate differences.

Additionally, with an interest in regional water matters, the OCGJ decided to extend its scope and examine the broader network of water and wastewater entities in South Orange County. The OCGJ identified a group of major water/wastewater providers that, through a long-standing JPA, manage and provide regional collection and treatment of wastewater to support their respective service areas. The OCGJ then undertook an investigation to assess the governance structure and operational effectiveness of this collaborative legal network. The OCGJ was particularly interested in the interrelationship of these water and wastewater providers and the prospect of future consolidations in South Orange County.

METHOD OF STUDY
The OCGJ conducted interviews with key personnel, attended tours, observed meetings, and reviewed documents relevant to the topic. Research focused primarily on public agencies serving South Orange County.
5 Capital Improvement Program,https://efc.sog.unc.edu/resource/capital-planning-resources-for-waterand-wastewater-utilities/ 6 Huntington Beach Water / Wastewater Rate Report.
https://huntingtonbeach.legistar.com/View.ashx?M=F&ID=12846347&GUID=CF0B144A-8C49-4FFEBC0F-EADFC70C317C 405
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Interviews:
• Shea Therapeutic Riding Center
• City of Laguna Beach
• ATS Financial Services
• City of San Clemente
• City of San Juan Capistrano
• South Coast Water District
• Santa Margarita Water District
• Moulton-Niguel Water District
• Irvine Ranch Water District
• Laguna Beach County Water
District
• Municipal Water District of Orange
County
• Trabuco Canyon Water District
• El Toro Water District
• South Orange County Wastewater
Authority
• Orange County Water District
• Orange County LAFCO
• Berkson Associates Consulting
• Emerald Bay Service District
Site Visits:
• Orange County Emergency Operating
Center at Loma Ridge
• Municipal Water District of Orange
County
• Orange County Sanitation District • Orange County Water District • Santa Margarita Water District • Moulton Niguel Water District • Irvine Ranch Water District • Laguna Beach County Water District • San Clemente Public Works
Department
• South Coast Water District
• JB Latham Treatment Plant
• City of Laguna Beach Public Works
• El Toro Water District
• South Orange County Wastewater
Authority
• Robert B. Diemer Treatment Plant
• Coastal Treatment Plant
Meetings:
• LAFCO
• Municipal Water District of Southern
California
• OCWD Water Summit
• Water Advisory Committee of Orange
County (WACO)
Documents and Websites Reviewed:
• Previous Grand Jury reports
• M1 Manual-Association of California Water Agencies the Manual of Standard Practices by the American Water Works Association
• Websites, staff reports, agendas, and meeting recordings for water agencies in South Orange County
• Review of applicable State and local laws and regulations • Local news articles and reports
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INVESTIGATION AND ANALYSIS
WATER SYSTEMS – THE CONSOLIDATION PROCESS
Case Study: City of San Juan Capistrano and Santa Margarita Water District The City of San Juan Capistrano’s (SJC) water utilities transfer offers an insightful case study highlighting the challenges and benefits with consolidating its municipal water systems with the Santa Margarita Water District (SMWD). Records dating back to 2000 reveal a decades-long struggle marked by local political tensions, financial strain from ratepayer lawsuits, deferred maintenance, and insufficient capital reinvestment in the water system. These factors, compounded by a reluctance to adjust rates to cover ongoing water costs, culminated in a critical junction where the city eventually found itself seeking a more capable water provider to assume control of its water systems.

In the pivotal year of 2011, the financial hardships plaguing SJC intensified. A series of multimillion dollar lawsuits led to a substantial decrease in the city’s bond rating, creating an additional $7.5 million deficit in the city’s budget. Faced with this fiscal crisis, the city resorted to extreme budgetary measures with city-wide cutbacks affecting the utility sector.

This financial rollercoaster persisted through Fiscal Years 2012 to 2014, until 2015 delivered yet another major economic hit. There was an unfavorable Court of Appeal’s decision in a lawsuit concerning the City’s billing rate system that impacted affluent and high-water users. It mandated an additional $4.1 million refund, exacerbating the City’s already precarious financial state.7It was at this point, in 2015, that the City began to explore divesting its water and wastewater utilities. By August 2016, the City took a decisive step by filing an application with Orange County LAFCO to conduct a focused Municipal Service Review (MSR). The purpose was to explore the potential transfer of its water and wastewater operations and facilities to a public successor agency.

LAFCO’s Regulatory Role: Municipal Service Reviews
LAFCOs are independent regulatory commissions throughout California that were created by the legislature in 1959 and are charged with controlling and adjusting the boundaries of cities and most special districts in all 58 counties. (See Cal. Gov. Code §§ 56001, 56325.) Besides regulating local government boundaries, LAFCOs play an important role in evaluating municipal services within their counties and making recommendations for improvements. LAFCOs review and update the designated sphere of influence for each city and special district under their jurisdiction. Prior to establishing or updating a sphere of influence, LAFCO must perform a special MSR. MSRs are comprehensive studies to determine the adequacy of governmental services being provided by the local agencies under LAFCO jurisdiction. MSRs can be conducted 7 Meghann M Cuniff, “San Juan Capistrano to pay $4.1 million to refund customers for illegal water rates” Orange County Register, June 18, 2015.
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individually for specific cities or districts, covering all services, or on a county-wide or regional basis focused on specific services.

As the local regulatory agency, Orange County’s LAFCO was tasked with reviewing the annexation proposal submitted by SJC and analyzing the financial suitability and operational capability of potential public successor agencies. On October 10, 2018, LAFCO issued its Focused MSR,
8 which assessed the SJC’s utilities and identified
potential successor public agencies to assume their operations.9 This report held significant weight in the City’s search for a solution to off-loading its distressed assets.

The MSR identified three interested special water districts for further consideration:

South Coast Water District (SCWD), Santa Margarita Water District (SMWD), and Moulton Niguel Water District (MNWD). Notably, the report underscored that all three potential agencies were generally better positioned than the city to provide water and sewer services to the community,
10 thus marking a turning point in SJC’s search for a
viable solution to its long-standing water system challenges.

Following presentations from three qualified special districts and input from the public, SJC selected SMWD on February 19, 2019, for further discussion on the transfer of the City’s water and sewer utility systems. The City Council’s rationale for this decision was based on the potential for an economy of scale, enhanced operations, infrastructure improvements, and stabilized utility rates for its ratepayers. 11 Subsequently, on January
21, 2020, the City unanimously approved the annexation agreement with SMWD12 and in late winter of 2020, SMWD filed an annexation application with LAFCO.13 As part of the process, SMWD submitted a Plan of Service proposing enhanced efficiency and cost-effective delivery of services to the affected ratepayers.14 On August 19, 2021, LAFCO approved the SMWD annexation of SJC’s water and wastewater utilities, citing such benefits as stabilization of rates and immediate, longterm improvements of both utilities. 15 SMWD assumed operational control of the City’s
water systems on November 15, 202116, designating the area formerly serviced by the 8 FOCUSED MUNICIPAL SERVICE REVIEW (oclafco.org)
9 Orange County Local Agency Formation Commission Agenda Report Proposed “Santa Margarita Water District Annexation of the City of San Juan Capistrano Water and Wastewater Utilities” August 19, 2021, p. 1.
10 Ibid. pp. 1-2.
11 Ibid.
12 San Juan Capistrano City Council Meeting Minutes dated January 21,2020, p. 4. 13 Santa Margarita Water District Letter to Local Agency Formation Commission, Orange County Subject:

City of San Juan Capistrano Potable Water, Recycled Water, and Wastewater Utilities – Santa Margarita Water District’s Plan of Service and Application Form, December 23, 2020, pp. 1-2. 14 Ibid.
15 Orange County Local Agency Formation Commission Agenda Report Proposed “Santa Margarita Water District Annexation of the City of San Juan Capistrano Water and Wastewater Utilities” August 19, 2021, pp. 21-22.
16 FAQs • Why does SMWD want to take over San Juan Capistrano’s Water and Wastewater service from the City? https://www.smwd.com/faq.aspx?qid=180
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SJC as Improvement District 9 (ID 9), distinct from SMWD’s Improvement Districts 1 through 8.17
In May 2023, SMWD issued a Cost of Service and Rate Study concerning ID 9 that focused on determining rates necessary to cover water service costs as required by the California Constitution under Proposition 218.18 The study found 135 prominent ratepayers, including shopping centers, industrial buildings, schools, churches, and a major non-profit, that would be significantly impacted by the proposed monthly rate increases,
19 specifically for their fire service lines. For instance, businesses faced increases from nearly $9,700 to over $14,000 annually for fire service lines, a result of SMWD’s new rate methodology based on capacity. In contrast, residential lines saw more modest increases of no more than $30 a month.20
SMWD responded to the rate increase concerns by sending out required notices to new ID 9 ratepayers and met with those severely impacted. The proposed rate increases were publicized by local media, leading to protests from some affected ratepayers. At a July 12, 2023, public hearing on proposed rates, SMWD staff highlighted the City’s deferred maintenance of infrastructure, and the lack of rate increases since July 2018.

They argued that the increases were necessary to align ID 9 with the rest of the district.

Protesting ratepayers claimed the proposed rate hikes were unjust. One ratepayer hired a consultant to evaluate the SMWD rate study. Thirteen water districts in Orange and Riverside Counties were included in the investigation. The rate methodology employed in the SMWD Cost of Service and Rate Study was not used in any of the 13 districts that were studied.
21 In response to this feedback, SMWD’s Board of Directors voted to continue the meeting to August 2, 2023. On that date, the Board approved ID 9 water rate increases proposed by staff, except for the capital charge component for fire meter owners.

Additionally, the Board ordered a new Cost of Service and Rate Study for all districts within SMWD to be completed by June 30, 2024.
17 https://www.smwd.com/DocumentCenter/View/4247/SMWD-ID-9-Cost-of-Service-and-Rate-Study p.3. 18 Ibid.
19 Santa Margarita Water District Memorandum to: Board of Directors From Daniel Ferons, Erica Castillo Subject: Public Hearing on Proposition 218 Rate Structure; and Consideration and Action on Adoption of Resolution No. 2023-07-01 Adopting Adjustments in its Potable Water, Recycled Water, and Wastewater Service Charges and Water Shortage Contingency Rates for Improvement District No. 9 (San Juan Capistrano) Agenda Packet July 12, 2023, p.7.
20 Brandon Pho, Noah Biesiada, San Juan Capistrano Businesses Shocked over Staggering Proposed Water Bill Hike, Voice of OC, June 22, 2023.
21 Findings Report, ATS Financial Services, July 6, 2023 “Analysis of ID 9 (SJC) of the SMWD Cost of Service and Rate Study and Proposed Rate Adjustments.”
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SJC/SMWD Consolidation Timeline
Figure 3
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Summation
Although initial rate increases drew some criticism from the community, after the consolidation, the average monthly residential rate went up $30. Overall, the SMWD consolidation signaled a positive direction for SJC’s water future. Since the transfer, new SMWD customers have generally expressed satisfaction with their new provider’s service and water quality, as reflected in polls and customer surveys. 22 Additionally,
SMWD is actively addressing deferred maintenance needs and making necessary infrastructure capital improvements neglected over time. Also, customer rates for ID 9 are on schedule to be consistent with the entire district by 2030. 23 The case of the SJC’s water systems having undetected deficiencies underscores the need for an extensive assessment of the utilities in advance of such reorganizations.

Transparency and more due diligence would have mitigated some consolidation concerns and helped smooth the transition of service providers. Research also suggests the need for a more extensive analysis of rate increases for non-residential customers.

WASTEWATER SYSTEMS - REGIONAL COLLABORATION
Case Study: South Orange County Wastewater Authority (SOCWA) SOCWA was formed in 2001 when the South East Regional Reclamation Authority, Aliso Water Management Agency, and South Orange County Reclamation Authority consolidated to meet the wastewater needs of more than 500,000 homes.

The mission of SOCWA is to collect, treat, beneficially reuse, and dispose of wastewater in a manner that protects and respects the environment; maintains the public’s health; and meets local, state, and federal regulations. 24 (See figure 4)
SOCWA exists to handle the wastewater needs of homes and businesses throughout South Orange County. It oversees the entire process from collection to disposal, ensuring water is treated properly. Additionally, SOCWA plays an important role in producing recycled water for irrigation and commercial purposes, saving a substantial amount of domestic water annually. This translates to preserving around 1.6 billion gallons of water, equivalent to 16,259 acre-feet.

SOCWA operates in collaboration with member agencies, including local water providers and local cities. It manages various programs to fulfill the Clean Water Act and National Pollutant Discharge Elimination System (NPDES) 25 permit requirements. It
also operates two ocean outfalls and three wastewater treatment plants. The facilities 22 One Year Later: A Look at Santa Margarita Water District’s Acquisition of San Juan Capistrano’s Water Utilities | Eye on SJC | picketfencemedia.com.
23 Ibid.
24 Ibid.
25 National Pollutant Discharge Elimination System (NPDES) | US EPA 411
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owned and/or operated by SOCWA include the Coastal Treatment Plant located in the City of Laguna Beach, the JB Latham Treatment Plant located in the City of Dana Point, and the Regional Treatment Plant located in the City of Laguna Niguel. Together these three plants provide regional collection and treatment to approximately one third of the County’s population.

Wastewater Purification and Recycling
Figure 4 Source: sdcwa.org waternewsnetwork.com

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Joint Power Authority: Governing Structure
SOCWA is a JPA originally founded by 10 member agencies consisting of local water and service districts and cities. A JPA is a membership between two or more public agencies to jointly exercise common powers.26 SOCWA currently has 7 member agencies which include two cities, four water districts, and a community services district.

The four water districts in SOCWA provide sewer and water service to their customers. (See Appendices 1 and 2).

SOCWA’s Board of Directors is made up of one representative from each of SOCWA’s members. Each director has one vote regardless of their individual levels of contribution to SOCWA’s revenues or the size of the population or territory they serve. Among other functions, the Board is responsible for approving SOCWA’s budget, appointing its general manager, and taking other administrative actions. While SOCWA’s Board governs matters that affect SOCWA as a whole, members enter into agreements with each other to establish project committees to serve their specific needs.27 A project committee forms when members enter into agreements to share the cost of an existing SOCWA wastewater processing facility or to construct a new facility in exchange for their use of the facility for processing their wastewater products or for other purposes. By entering into these agreements, members establish a right to a certain amount of capacity in a SOCWA facility. Capacity here refers to the member’s right to use the facility to process wastewater liquids and solids or to perform advanced water treatment. Project committee agreements and budgets express these capacities as a percentage of the total capacity of the facility for its different functions.28 Voting at the project committee level also follows a one-member, one-vote structure.

Members of a project committee vote on matters directly related to that project committee, including budgets to maintain or expand the facility. Members of project committees are bound by the terms of their agreements to pay their share of project costs. Members may only be relieved of this obligation by mutual consent of all participating members of the particular project committee.29 SOCWA has no direct taxing authority, and nearly all funding for its operations comes directly from the contribution of members. SOCWA bills project committee members for their share of SOCWA’s costs to construct, operate, and maintain the facilities the project committees utilize. Project committee agreements establish each participating 26 https://www.auditor.ca.gov/reports/2017-113/introduction. 27 Ibid.
28 Ibid.
29 Ibid.
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member’s share of operation and maintenance costs and capital costs generally based on the member’s level of usage or capacity rights.30
SOCWA: Disputes and Succession
In May 2017, SOCWA, along with three of its members, filed a lawsuit alleging that one of its members – Moulton Niguel Water District (MNWD) had failed to pay its contractual share of project costs for the Coastal Treatment Plant (CTP).31 MNWD entered into a project committee with the City of Laguna Beach, SCWD, and Emerald Bay Service District (EBSD) in 1999 to use CTP’s capacity to process up to 1.96 million gallons per day (MGD) of its wastewater products. In response, MNWD stated it no longer used any of its contractual capacity to CTP and filed an answer and cross-complaint in August 2017 alleging fiscal mismanagement, fiscal improprieties, and poor retention of financial records on the part of SOCWA.32
In March 2018, the California State Auditor released its audit report (SOCWA State Audit Report)
33 concerning the financial management practices and governance structure of SOCWA. It found that the elements of SOCWA’s governance structure were generally similar to that of other wastewater and water JPAs in California. The report found evidence of financial mismanagement and inadequate record keeping but indicated that SOCWA had taken steps to correct its fiscal and record keeping practices. In response to the audit SOCWA agreed to the recommendations contained in the report.34
In February 2019, the Riverside Superior Court issued its tentative ruling holding that MNWD was legally obligated to pay its proportional share of all costs, including capital costs and items necessary to maintain and operate the Coastal Treatment Plant until February 19, 2030 when the CTP project agreement ended.35 In May 2019, SOCWA, MNWD, SCWD, EBSD, and the City of Laguna Beach issued a public statement regarding the litigation on the coastal treatment plant, and that the parties had agreed to resolve their differences on mutually agreeable terms.36 On August 9, 2023, LAFCO issued its MSR Sphere of Influence Reviews covering the Southwest Region (OCLAFCO SW MSR).
37 It identified all agencies in the region that
receive wastewater services in some capacity from SOCWA. Services provided by SOCWA generally fit into two areas:
30 https://www.auditor.ca.gov/reports/2017-113/introduction. 31 Ibid
32 Ibid.
33 https://www.auditor.ca.gov/reports/2017-113/summary.html 34 https://www.auditor.ca.gov/reports/2017-113/response.html 35 https://www.ocregister.com/2019/02/27/judge-rules-on-2-million-dispute-over-orange-county-sewageplant/ 36 https://www.ocregister.com/2019/05/20/moulton-niguel-water-district-agrees-to-pay-4-8-million-inwastewater-dispute/ 37https://oclafco.org/wp-content/uploads/2024/01/OCLAFCO_Southwest_MSR_-_Final_8.28.23.pdf 414
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1. Permitting and regulatory support for the operation of all wastewater treatment plants in south Orange County

2. Operation of three wastewater treatment plants
The MSR also noted the SOCWA’s JPA agreement previously included ten agencies but had recently been reduced to seven voting members including the El Toro Water District (ETWD), MNWD, SCWD, EBSD, the City of Laguna Beach, SMWD, and the City of San Clemente. As of July 1, 2023, the following three agencies were no longer members of SOCWA: Irvine Ranch Water District (IRWD), Trabuco Canyon Water District (TCWD), and SJC. San Juan Capistrano’s wastewater services and infrastructure were assumed by SMWD through an annexation to the district in 2021 and TCWD and IRWD had arranged for former SOCWA services to be provided through other means.38
The MSR stated SOCWA staff were aware of the evolving issues regarding SOCWA’s management, purpose, and structure, and had hired a facilitator at the request of SCWD to assist in moving the discussion forward. Additionally, SOCWA staff noted that the agencies have full authority to make any changes they desire to the JPA agreement, provided they get the appropriate majority.

The MSR further noted within SOCWA there are numerous shared facilities for wastewater collection and treatment. These are managed by SOCWA through separate project agreements or committees among various member agencies. Many of these agreements predate SOCWA and are due to expire in 2030. MNWD had expressed strong interest in assuming the operational responsibility of one of SOCWA’s regional facilities, the Regional Treatment Plant. In its justification, MNWD saw a potential benefit if several of SOCWA’s assets were operated by each member agency. In their view, which was shared by SMWD, SOCWA is not structured to meet the wastewater service needs of some member agencies and should focus on providing enhanced permitting and regulatory compliance support for the SOCWA member agencies.

The MSR found that SCWD had expressed a strong interest in preserving the existing structure of SOCWA while also expressing openness to evaluating the agreements for efficiency and improvement. The other agencies reviewed in the MSR did not express similar interest in a reexamination of the SOCWA arrangements, nor did they share any complaints or concerns about SOCWA’s service level. While they did not express a desire to advance these ideas during the MSR process, they stressed their openness to reevaluating the project agreements as they approach their respective expiration dates.

After the MSR, SOCWA members conducted facilitator directed meetings to address member concerns.

At the Board of Directors meeting on March 7, 2024, SOCWA presented a $20 million buyout proposal to transition the Regional Treatment Plant to MNWD and other 38 Ibid
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considerations to facilitate MNWD’s withdrawal from SOCWA.39 The proposed agreement will become effective on June 30, 2024, and is contingent on several conditions including the required unanimous vote of all SOCWA members to authorize MNWD’s withdrawal from SOCWA.40
On May 1, 2024, a special meeting was held to address the March 7, 2024, proposal to transition the Regional Treatment Plant to MNWD and to facilitate MNWD’s withdrawal from SOCWA. There was unanimous approval of the proposal in principle with members set to return to their respective boards for official approval by June 1, 2024.

The steps ahead are to continue negotiations and require MNWD to provide its official response. If consensus is reached, then terms and conditions would be laid out to adopt the necessary amendments to various JPA agreements and Project Committee agreements. MNWD would need to develop and adopt an agreement with SCWD, EBSD, City of Laguna Beach, and ETWD for handling solid waste. Treatment, conveyance, and outfall agreements would need to be developed and adopted between SOCWA and MNWD.

Lastly, upon MNWD’s withdrawal from SOCWA, and after the buyout payment, the transfer of the Regional Treatment Plant and its operation to MNWD would be complete.

Summation
The history of SOCWA shows the divergent approaches of its member agencies. While some agencies embraced long-range regional collaboration, it could be argued that smaller districts with overweighted voting authority hindered them. Past litigation among JPA members has created a legacy of distrust, and Balkanized decision-making among its governing directors. Water officials interviewed by the OCGJ clearly indicated tension among rival SOCWA members. It appears some members are entrenched in transactional approaches aimed solely at addressing ownership, operation, and modernization of treatment plants within their own boundaries.

Water and wastewater agencies, like SOCWA, have worked together through legal agreements in the past. However, SOCWA’s collaborative efforts have not always been successful which may be reflective of its JPA governing structure. 41 Over time, changes
in local support, leadership, and financial pressures have led member agencies to reconsider their involvement in the JPA.
39 https://www.socwa.com/event/board-of-directors-meeting-3-7-2024/?instance_id=716 40 https://www.socwa.com/wp-content/uploads/2023/12/7f-2024-03-06-SOCWA-Proposal-to-TransitionRTP-to-MNWD.pdf 41 Trish Cypher and Colin Grinnell, “Governments Working Together: Citizen’s Guide to JPAs” (California State Legislature, 2007).
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It was evident from the SOCWA special meeting of May 1, 2024, that leaving a JPA can be complicated.42 SOCWA started with 10 members but is now down to 7, and negotiations are ongoing for yet another member to leave. Now, SOCWA needs new agreements to govern its operations going forward. This leaves uncertainty about SOCWA’s future beyond the expiration of its original contracts in 2030. However, with California’s ocean discharge regulations being so extensive, JPA members have expressed support for SOCWA to continue in some form to handle permitting as well as other regulatory support functions within its purview.

THE PATH FORWARD
Water System - Consolidations
Consolidating, restructuring, or merging agencies is a function of assessing the costs and benefits regarding safety, security,
43 reliability, financial and operational efficiencies, and economies of scale, versus the attraction of local control. A thorough assessment of this “balancing act” will benefit future generations of Orange County residents.

South Orange County is served by ten water providers in jurisdictions ranging in size from 540 customers in EBSD to 116,000 customers in IRWD (Appendices 1 and 2). To advance consolidations, over the past decade the State of California has developed financial incentives for larger water systems to absorb small systems, introduced new authorities to mandate consolidation under specific circumstances, and invested significantly in technical assistance resulting in over 200 completed projects throughout the State with more underway.44 Interviews identified the benefit of having a single entity to discuss the optimal management/structure of water, wastewater, and reuse operations with a common vision for the future of Southern Orange County.

In recent years, water districts have experienced the benefits of consolidation with one another, as evidenced by IRWD. It has successfully acquired five other agencies over the past twenty-seven years, including the Santa Ana Heights Mutual Water Company in 1997, Carpenter Irrigation District in 2000, Los Alisos Water District in 2001, Santiago County Water District in 2006, and the Orange Park Acres Mutual Water Company in 2008.45
Irvine Ranch Water District’s process involves a selective approach, emphasizing efficiencies and mutual benefits. It begins with a consolidation request to IRWD from the prospective water agency, followed by mutual agreement on terms, and then an application to LAFCO for their evaluation. Irvine Ranch Water District has a proven track 42 https://www.socwa.com/wp-content/uploads/2023/12/7f-2024-03-06-SOCWA-Proposal-to-TransitionRTP-to-MNWD.pdf 43 EPA warns of increasing cyberattacks on water systems | AP News 44 Luskin Center for Innovation, Trends in California Water Systems Consolidation (December 2023) Policy-Brief-Trends-in-California-Water-Systems-Consolidation.pdf (ucla.edu) 45 Consolidations (irwd.com) https://www.irwd.com/about-us/consolidations 417
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record since 1997 of having successfully unified five providers benefitting 57,000 residents with improved water reliability and standardized rates. With extensive cash reserves, IRWD is poised to maintain and enhance its water systems over the next fifty years.

It is evident that past consolidations among water agencies have yielded positive outcomes by enhancing efficiencies and fostering mutual benefits through shared expertise and resources. With the multitude of water districts and the risk of financial strain comparable to SJC, future consolidations are not just probable but beneficial.

Hence, it is imperative to draw lessons from past experiences. By reviewing the issues and concerns encountered by SMWD and by adopting the strategies employed by IRWD, there is an opportunity to improve the process for future consolidations (Appendices 1 and 2).

Wastewater Systems - Collaboration
In South Orange County, collaboration among water and wastewater providers can drive positive changes for the region’s future. Despite past challenges posed by differing governing boards and environmental perspectives across separate jurisdictions, officials have shown the willingness to unify and address shared concerns. The future of SOCWA involves reorganizing the structure so that it can resolve the operational issues of treatment plants. This allows major water agencies to focus on maximizing wastewater reuse and to minimize ocean discharge, with the aspirational goal of zero discharge. Collaboration among all agencies operating treatment plants is paramount, to adopt a more integrated management approach.

The Moulton Niguel Water District, one of the leading service providers, has embraced a transformative drive to water management. Since 2019, MNWD has pursued federal funds to strengthen its infrastructure against seismic and severe storm damage. In 2024 the district was awarded $10.3 million in federal grants to strengthen and improve its wastewater infrastructure. The grant is administered by the California Office of Emergency Services and funded by the Federal Emergency Management Agency (FEMA) to replace sewer lines that move more than half of all district wastewater.46 Advocating for funding as a region to address aging infrastructure is vital to ensure the long-term sustainability of water management efforts. By working collectively towards these goals, South Orange County can lead the way in sustainable water management practices for the benefit of current and future generations.

The Mouton Niguel Water District is also working on a reverse osmosis project called OASIS (Optimal, Adaptive, Sustainable, Integrated, Supply) to receive wastewater from homes and businesses, and treat it for potable reuse. The OASIS project emerges as a beacon of innovation and sustainability, offering not only reliable water reuse but also an opportunity for education and public engagement. By demonstrating the safety and effectiveness of direct potable reuse, South Orange County can pave the way for similar 46 https://www.mnwd.com/moulton-niguel-water-district-awarded-federal-grant/ 418
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projects across California. Building partnerships with neighboring regions, environmental organizations, and governmental bodies will be crucial to securing state, federal, and private funding dedicated to advancing water reuse in South Orange County, with OASIS as the flagship project, being a top priority.

Another transformative advancement is the Doheny Ocean Desalination Project, planned by the South Coast Water District as part of the Joint Regional Water Supply System. This project would create a new, local, drought-proof water supply that would provide emergency water supplies.47 Benefits would provide a water source at a reasonable cost, up to 5 million gallons per day of drinking water and the potential for long-term regional benefits. The proposed facility would be located near Doheny State Beach in the City of Dana Point and is planned to be on-line in 2028.

Looking ahead, the integration of treatment plant operations and the advancement of technologies like direct potable use and desalination are key focal points. As such, the OCGJ recommends LAFCO form a task force comprising representatives of affected water districts to study the transformation of SOCWA and prepare a report identifying the optimal future of water and wastewater systems in South Orange County.

In an era of emerging opportunities, a comprehensive regional plan developed in conjunction with all stakeholders is needed for guiding future projects and addressing evolving needs. As the task force facilitator, LAFCO can also play a pivotal role in studying future consolidations and a unified regional approach to water and wastewater management and service delivery. By planning and working together, South Orange County is poised to lead the way in securing a better future for generations to come.

COMMENDATIONS
Irvine Ranch Water District (IRWD) - The Irvine Ranch Water District successfully acquired 5 water providers serving 57,000 residents since 1999. These consolidations provide reliable water supply at equitable rates, which are mutually beneficial to all customers.

City of San Clemente – Based on interviews and a comprehensive site visit, the OCGJ found the City of San Clemente does an excellent job in maintaining and operating its water and wastewater utility systems. This integrated system augments the City’s local recycled water sources and is beneficial in reusing urban runoff and reducing biosolids. 47 South Coast Water District, CA (scwd.org)
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FINDINGS
In accordance with California Penal Code Sections 933 and 933.05, the 2023-2024 Grand Jury requires responses from each agency affected by the findings presented in this section. The responses are to be submitted to the Presiding Judge of the Superior Court.

Based on its investigation described here, the 2023-2024 OCGJ has arrived at the following principal findings:

F1. San Juan Capistrano’s deferred maintenance of the water/wastewater utility resulted in the need to transition the facility to a larger water provider to allow more efficient management and maintenance of the infrastructure.

F2. The SMWD proposed rate increase severely impacted San Juan Capistrano’s non-residential customers and led to protests of unfairness and negative attention from the local media.

F3. SOCWA’s member agencies have widely diverse populations, requirements, and revenues. This has led to conflicts over governance, facility operation, and control, affecting the evolving potential for wastewater reuse.

F4. There is currently no unified strategy for the future of water/wastewater provision in South Orange County

RECOMMENDATIONS
In accordance with California Penal Code Sections 933 and 933.05, the 2023–2024 Grand Jury requires responses from each agency affected by the recommendations presented in this section. The responses are to be submitted to the Presiding Judge of the Superior Court.

Based on its investigation titled “Emerging Opportunities in South County Water/ Wastewater Systems,” the 2023-2024 OCGJ makes the following two recommendations:

R1. The OCGJ recommends that by January 1, 2025, LAFCO studies a policy of conducting a post-consolidation agency review to be held within 24 months of agency reorganizations to determine their overall impact on the public. (F1, F2) R2. The OCGJ recommends that by January 1, 2025, LAFCO form a task force comprising representatives of affected water agencies to study the transformation of SOCWA and prepare a report on the future of water/wastewater in South Orange County. (F3, F4)
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RESPONSES
California Penal Code Section 933 requires the governing body of any public agency which the Grand Jury has reviewed, and about which it has issued a final report, to comment to the Presiding Judge of the Superior Court on the findings and recommendations pertaining to matters under the control of the governing body. Such comment shall be made no later than 90 days after the Grand Jury publishes its report (filed with the Clerk of the Court). Additionally, in the case of a report containing findings and recommendations pertaining to a department or agency headed by an elected county official shall comment on the findings and recommendations pertaining to the matters under that elected official’s control within 60 days to the Presiding Judge with an information copy sent to the Board of Supervisors.

Furthermore, California Penal Code Section 933.05 specifies the manner in which such comment(s) are to be made as follows:
(a) As to each Grand Jury finding, the responding person or entity shall indicate one of the following:
(1) The respondent agrees with the finding.
(2) The respondent disagrees wholly or partially with the finding, in which case the response shall specify the portion of the finding that is disputed and shall include an explanation of the reasons therefore. (b) As to each Grand Jury recommendation, the responding person or entity shall report one of the following actions:
(1) The recommendation has been implemented, with a summary regarding the implemented action.
(2) The recommendation has not yet been implemented, but will be implemented in the future, with a timeframe for implementation. (3) The recommendation requires further analysis, with an explanation and the scope and parameters of an analysis or study, and a timeframe for the matter to be prepared for discussion by the officer or head of the agency or department being investigated or reviewed, including the governing body of the public agency when applicable. This timeframe shall not exceed six months from the date of publication of the Grand Jury report. (4) The recommendation will not be implemented because it is not warranted or is not reasonable, with an explanation, thereof.
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(c) If a finding or recommendation of the Grand Jury addresses budgetary or personnel matters of a county agency or department headed by an elected officer, both the agency or department head and the Board of Supervisors shall respond if requested by the Grand Jury, but the response of the Board of Supervisors shall address only those budgetary or personnel matters over which it has some decision-making authority. The response of the elected agency or department head shall address all aspects of the findings or recommendations affecting his or her agency or department.

Responses Required
Comments to the Presiding Judge of the Superior Court in compliance with Penal Code Section 933.05 are required from:

Findings – 90 Day Response Required
Recommendations – 90 Day Response Required
Orange County LAFCO Board of
Commissioners
R1, R2
City of Laguna Beach R2
City of San Clemente R2
City of Laguna Beach F3, F4
City of San Clemente F3, F4
City of San Juan Capistrano F1, F2
El Toro Water District F3, F4
Emerald Bay Service District F3, F4
Irvine Ranch Water District F4
Laguna Beach County Water District F4
Moulton Niguel Water District F3, F4
Santa Margarita Water District F1, F2, F3, F4
SOCWA Board of Directors F3, F4
South Coast Water District F3, F4
Trabuco Canyon Water District F4
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El Toro Water District
Emerald Bay Service District
R2
R2
Irvine Ranch Water District R2
Laguna Beach County Water R2
Moulton Niguel Water District R2
Santa Margarita Water District
SOCWA Board of Directors
R2
R2
South Coast Water District R2
Trabuco Canyon Water District R2

REFERENCES
American. 2000. Principles of Water Rates, Fees, and Charges. American Water Works Association.

Berkeley Water Systems Consolidation: Policy-Brief-Trends-in-California-WaterSystems-Consolidation.pdf (ucla.edu) CALAFCO - Calif Assn of Local Agency Formation Commissions - About LAFCOs (calafco.org)
California Department of Water Resources All Programs (ca.gov) “Capital Planning Resources for Water and Wastewater Utilities | UNC Environmental Finance Center.” n.d. Efc.sog.unc.edu. Accessed May 27, 2024. https://efc.sog.unc.edu/resource/capital-planning-resources-for-water-and-wastewaterutilities/.

City of San Juan Capistrano Agenda Report Resolution Approving Annexation Agreement Pertaining to Transfer of the City's Water and Sewer Utility Systems to the Santa Margarita Water District, January 21,2020:
https://sjc.granicus.com/MetaViewer.php?view_id=3&clip_id=2066&meta_id=122976 “Consolidations.” Irvine Ranch Water District. Accessed May 27, 2024. https://www.irwd.com/about-us/consolidations.
423
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Cypher, Trish and Grinnell, Colin, “Governments Working Together: Citizen’s Guide to JPAs” (California State Legislature, (2007). GWTFinalversion2 (ca.gov) Dispatch, Capo. 2022. “One Year Later: A Look at Santa Margarita Water District’s Acquisition of San Juan Capistrano’s Water Utilities.” Picket Fence Media. November 23, 2022. https://www.picketfencemedia.com/thecapistranodispatch/eye-on-sjc/oneyear-later-a-look-at-santa-margarita-water-district-s-acquisition-of-sanjuan/article_c7c7baee-a4df-588d-b826-65e81622c1a7.html.

EPA Warns of Increasing Cyberattacks on Water Systems | AP News.” AP News, May 21, 2024. https://apnews.com/article/water-utilities-cyberattack-epa-russia1435b3e6a569aa046e05c7947f0a0f3d.

FAQs • Why Does SMWD Want to Take over San Juan Capistrano’s.” n.d.

Www.smwd.com. Accessed May 27, 2024. https://www.smwd.com/faq.aspx?qid=180.

Final Report Cost of Service and Rate Study for Improvement District 9 of the Santa Margarita Water District May 2023:
https://www.smwd.com/DocumentCenter/View/4247/SMWD-ID-9-Cost-of-Service-andRate-Study Findings Report, ATS Financial Services, July 6, 2023 “Analysis of ID 9 (SJC) of the SMWD Cost of Service and Rate Study and Proposed Rate Adjustments.” “Governance | Santa Margarita Water District, CA.” n.d. Smwd.com. Accessed May 27, 2024. https://smwd.com/224/Governance.

Hirsh, Danita. n.d. “Board of Directors Meeting 3-7-2024 (2024-03-07).” https://www.socwa.com/event/board-of-directors-meeting-3-7-2024/?instance_id=716 Joint Regional Water Supply System (JRWSS) - A water transmission pipeline was constructed in 1961 to convey potable water from a Metropolitan Water District connection in Irvine, to water agencies serving communities from Irvine to San Clemente, including the California State Parks, San Onofre Nuclear Generating Station, and USMC Camp Pendleton in northern San Diego County.

Luskin Center for Innovation, Trends in California Water Systems Consolidation (December 2023) Policy-Brief-Trends-in-California-Water-Systems-Consolidation.pdf (ucla.edu)
“Municipal Service Review and Sphere of Influence Reviews Southwest Region.” Orange County Local Agency Formation Commission 2023. https://oclafco.org/wpcontent/uploads/2024/01/OCLAFCO_Southwest_MSR_-_Final_8.28.23.pdf. 424
Emerging Opportunities in South County Water/Wastewater Systems 2023-2024 Orange County Grand Jury Page 27
Orange County Local Agency Formation Commission (LAFCO) - County’s 34 cities and 34 Special Districts (BoundaryAnnexationReport_2022-23_20230608.pdf (oclafco.org)) … Quilt of Overlapping Governments
Orange County Local Agency Formation Commission. “Focused Municipal Service Review City of San Juan Capistrano Water and Wastewater Utilities,” October 10, 2018. https://oclafco.org/wp-content/uploads/2024/01/Final-SJC-MSR-Report-WithoutAttachment-Reference-2.pdf.

Orange County Local Agency Formation Commission. Proposed “Santa Margarita Water District Annexation of the City of San Juan Capistrano Water and Wastewater Utilities” August 19, 2021. https://oclafco.org/wp-content/uploads/2021/08/7a_SMWDAnnexation_Revised.pdf Orange County Register and Meghann M. Cuniff, “San Juan Capistrano to Pay $4.1 Million to Refund Customers for Illegal Water Rates,” Orange County Register, June 18, 2015:San Jua n Capistrano to pay $4.1 million to refund customers for illegal water rates – Orange County Register (ocregister.com)
Pho, Noah Biesiada, Brandon. 2023. “San Juan Capistrano Businesses Shocked over Staggering Proposed Water Bill Hike.” Voice of OC. June 22, 2023. https://voiceofoc.org/2023/06/san-juan-capistrano-businesses-shocked-over-staggeringproposed-water-bill-hike/ rbhatt. 2024. “Moulton Niguel Water District Awarded $10.3 Million Federal Grant.” MNWD. January 3, 2024. https://www.mnwd.com/moulton-niguel-water-districtawarded-federal-grant/.

Register, Martin Wisckol | Orange County. 2019. “Moulton Niguel Water District Agrees to Pay $4.8 Million in Wastewater Dispute.” Orange County Register. May 20, 2019. https://www.ocregister.com/2019/05/20/moulton-niguel-water-district-agrees-to-pay-4-8- million-in-wastewater-dispute/
Register, Orange County, and Meghann M. Cuniff. “Court: San Juan Capistrano’s Tiered Water Rates Are Illegal, May Hinder Conservation.” Orange County Register, April 21, 2015. https://www.ocregister.com/2015/04/21/court-san-juan-capistranostiered-water-rates-are-illegal-may-hinder-conservation/. “Report 2017-113.” n.d. Information.auditor.ca.gov. Accessed May 27, 2024. https://www.auditor.ca.gov/reports/2017-113/introduction. “Report 2017-117.” n.d. Information.auditor.ca.gov.
https://www.auditor.ca.gov/reports/2017-113/response.html. 425
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“Report 2017-113.” n.d. Information.auditor.ca.gov.
https://www.auditor.ca.gov/reports/2017-113/summary.html. “Ruling on San Juan Capistrano’s Water Rates May Mean Higher Prices for Some.” Orange County Register, April 22, 2015. https://www.ocregister.com/2015/04/22/rulingon-san-juan-capistranos-water-rates-may-mean-higher-prices-for-some/ San Juan Basin Authority (SJBA), a Joint Powers Authority (JPA) that manages the local groundwater and desalinization plant. The JPA is managed by SMWD and SCWD.

See: AMENDED AND RESTATED PROJECT IMPLEMENTATION AGREEMENT Santa Margarita Water District Letter to Local Agency Formation Commission, Orange County Subject: City of San Juan Capistrano Potable Water, Recycled Water, and Wastewater Utilities – Santa Margarita Water District’s Plan of Service and Application Form, December 23, 2020
Santa Margarita Water District Memorandum to: Board of Directors From Daniel Ferons, Erica Castillo Subject: Public Hearing on Proposition 218 Rate Structure; and Consideration and Action on Adoption of Resolution No. 2023-07-01 Adopting Adjustments in its Potable Water, Recycled Water, and Wastewater Service Charges and Water Shortage Contingency Rates for Improvement District No. 9 (San Juan Capistrano) Agenda Packet July 12, 2023:
https://santamargaritawaterdistrictca.iqm2.com/Citizens/FileOpen.aspx?Type=1&ID=16 03&Inline=True
“South Coast Water District, CA.” n.d. www.scwd.org.
https://www.scwd.org/about/district_projects/doheny_ocean_desalination_project/index. php.
“South Orange County Wastewater Authority (SOCWA) Proposal to Transition the Regional Treatment Plant (RTP) to Moulton Niguel Water District (MNWD) & Facilitate MNWD’S Withdrawal from SOCWA.” n.d. https://www.socwa.com/wpcontent/uploads/2023/12/7f-2024-03-06-SOCWA-Proposal-to-Transition-RTP-toMNWD.pdf State Water Resources Control Board Consolidation Steps (SWRC) SWRCB Consolidation Steps
US EPA. 2019. “National Pollutant Discharge Elimination System (NPDES) | US EPA.” US EPA. August 27, 2019. https://www.epa.gov/npdes
Water Advisory Committee of Orange County WACO
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“Water & Sewer Rate Adjustment.” n.d. Accessed May 27, 2024. https://huntingtonbeach.legistar.com/View.ashx?M=F&ID=12846347&GUID=CF0B144A -8C49-4FFE-BC0F-EADFC70C317C.

GLOSSARY
Acre-foot - A unit of measure used to calculate volumes of water. One acre-foot equals the volume of water that would cover an acre of land at a depth of one foot.

AWWA - American Water Works Association is a non-profit organization. Its mission is to improve water quality and supply.

Desalination - A process that removes salt and other minerals from water.

ISDOC - Independent Special Districts of Orange County is an association that advocates for Orange County’s independent special districts.

JPA - Joint Powers Authority is a membership between two or more public agencies to jointly exercise common powers.

LAFCO - Local Agency Formation Commission is a countywide commission, required in each California county. LAFCO’s powers include approving, establishing, expanding, reorganizing, and, in limited circumstances, dissolving cities and special districts.

MSR - Municipal Service Review is a comprehensive analysis conducted by LAFCO to assess the performance of municipal services within a specific geographic area.

NPDES - National Pollutant Discharge Elimination System OASIS - A initiative for advanced integrated water management started by MNWD. (Optimal, Adaptive, Sustainable, Integrated, Supply)
OCSAN - Orange County Sanitation District provides wastewater collection, treatment, and recycling North and Central Orange County.

Potable Water - Water that is suitable for human consumption.

Recycled Water - Wasterwater that has been treated (filtered and disinfected). It is used as irrigation for golf courses and parks.

Special District - A local government entity that was created to provide a specific public service. Examples are water service, cemetaries and fire protection.

SOCWA - South Orange County Wastewater Authority is a Joint Powers Authority with seven member agencies, consisting of local retail water agencies and cities that provide 427
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water to their residents. SOCWA manages the collection, transmission, treatment, and disposal of wastewater across South Orange County.

WACO - Water Advisory Committee of Orange County
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APPENDICES
APPENDIX 1
South Orange County Water Resource Agencies
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APPENDIX 2
South Orange County Water Resource Agencies Summary Data Notes
Data obtained from agency websites and interviews.

South Orange County imports approximately 90% of Water from Metropolitan Water District of Southern California TCWD operates the only potable water treatment facility in South Orange County IRWD Listed Separately as Majority of Customers in Central Orange County SOCWA operates the two ocean outfalls: Aliso Creek and San Juan Creek * Water system operated and maintained by LBCWD
** LBCWD is a Subsidiary (Dependent) District of the City whose Council serves as the Board. *** 7 Appointed by Member Agencies
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APPENDIX 3
South Orange County Water Districts/Providers
El Toro Water District (ETWD) - Provides water and wastewater service in the cities of Laguna Hills, Laguna Woods, Lake Forest, Aliso Viejo, and Mission Viejo.

Emerald Bay Service District (EBSD) - Provides fresh water supply under contract with the Laguna Beach County Water District. Collects wastewater and transmits to Laguna Beach.

Irvine Ranch Water District (IRWD) - Serves Central Orange County, including the following cities: Irvine, Newport Beach, Tustin, Orange, Lake Forest, and Costa Mesa.

Laguna Beach County Water District (LBCWD) - Provides water service to portions of the city of Laguna Beach, a portion of Crystal Cove State Park, and the unincorporated community of Emerald Bay.

City of Laguna Beach - Provides wastewater collection and/or transmission services to the city of Laguna Beach, a portion of Crystal Cove State Park, and the unincorporated community of Emerald Bay.

Moulton Niguel Water District (MNWD) - Provides water and wastewater services to customers in Laguna Niguel, Aliso Viejo, Mission Viejo, Laguna Hills, and Dana Point.

Municipal Water District of Orange County (MWDOC) is a wholesale water provider. It purchases imported water through the Metropolitan Water District of Southern California (MET) and delivers this water to its 27 member agencies, who in turn, provide retail water services to the public. It is the only agency with members from all water providers in South Orange County.

Orange County Water District (OCWD) - Manages the ground water supply for Orange County. It is a wholesale agency.

City of San Clemente - Provides water/wastewater services to the residents of San Clemente
Santa Margarita Water District (SMWD) - Serves the cities of Mission Viejo, San Juan Capistrano, Rancho Santa Margarita, and the communities of Coto de Caza, Las Flores, Ladera Ranch, Rancho Mission Viejo, and Talega in San Clemente.

South Coast Water District (SCWD) - Serves the communities of Dana Point, South Laguna Beach, and areas of San Clemente and San Juan Capistrano.

Trabuco Canyon Water District (TCWD) - Serves the Communities of Trabuco Canyon, Robinson Ranch, Trabuco Highlands, Walden, Rancho Cielo, Portola Hills, Santiago Canyon Estates, and Dove Canyon.
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Attachment 2
RESOLUTION NO. 24-135

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SAN CLEMENTE, CALIFORNIA, APPROVING RESPONSE

TO FINDINGS AND RECOMMENDATIONS IN THE
REPORT OF THE ORANGE COUNTY GRAND JURY –
“EMERGING OPPORTUNITIES IN SOUTH COUNTY
WATER/WASTEWATER SYSTEMS”
WHEREAS, on June 21, 2024, the 2023-2024 Orange County Grand Jury report, “Emerging Opportunities in South County Water/Wastewater Systems” was published; and
WHEREAS, the report focused on the 2021 consolidation of the City of San Juan Capistrano’s water and wastewater utilities with Santa Margarita Water District and how rate structure changes affected rate payers (lessons learned for future consolidations), and challenges associated with differing interests amongst South Orange County Wastewater Authority’s member agencies related to the future operation of the agency as agreement begin to expire; and
WHEREAS, California Penal Code Section 933 requires the City to provide a response to each of the findings and recommendations in the report; and WHEREAS, California Penal Code Section 933.05 specifies the manner in which the responses and comments on the findings and recommendations are to be made; and WHEREAS, the City values the opportunity to respond to the report, share our perspective, and provide firsthand knowledge to each of the issues requested by the Grand Jury; and
WHEREAS, the responses must be submitted to the Presiding Judge of the Superior Court by September 19, 2024; and
WHEREAS, the City Council has reviewed the report.

NOW, THEREFORE, the City Council of the City of San Clemente does hereby find, determine and resolve as follows:

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

SECTION 2. That the Mayor is authorized and directed to respond to the findings and recommendations noted in the report by submitting a letter to the Presiding Judge of the Superior Court by September 19, 2024 in substantially the same form as attached to this Resolution as Exhibit A, which is incorporated fully herein by this reference, and that such responses are approved.

SECTION 3. That the City Clerk shall certify to the passage and adoption of this 432
Resolution No. 24-132 Page 2
resolution and enter it into the book of original resolutions.

PASSED AND ADOPTED this _____ day of August, 2024.

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. 24-132 was adopted at a regular meeting of the City Council of the City of San Clemente held on the _______ day of August, 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 August, 2024. __________________________
CITY CLERK of the City of
San Clemente, California
Approved as to form:
___________________________
Elizabeth A. Mitchell, City Attorney
433
City Council 910 Calle Negocio, San Clemente, CA 92673
http://san-clemente.org
Exhibit A
August 21, 2024
The Honorable Michael J. Verrengia,
Presiding Judge of the Superior Court
Orange County Grand Jury
700 Civic Center Drive West
Santa Ana, CA 92701
Subject: Report of the Orange County Grand Jury - “Emerging Opportunities in South County Water/Wastewater Systems”
Dear Presiding Judge Verrengia,
The City of San Clemente (City) appreciates the time and effort the Grand Jury spent on the development of their report, “Emerging Opportunities in South County Water/Wastewater Systems.”
The City Council has reviewed the report and authorized the attached response to the findings and recommendations noted in the report. The City values the opportunity to respond to the report, share our perspective, and provide firsthand knowledge to each of the issues requested by the Grand Jury.

If the City of San Clemente can provide additional information or clarification of our response, please do not hesitate to contact City Manager Andy Hall at HallA@sanclemente.org.

Sincerely,
Victor Cabral,
Mayor, City of San Clemente
Enclosure: City of San Clemente’s Response to Findings and Recommendations CC: City of San Clemente Council Members
Andy Hall, City Manager

CITY OF SAN CLEMENTE

OFFICE OF THE MAYOR

Victor Cabral
Mayor
(949) 361-8322
[email protected] THE SPANISH VILLAGE BY THE SEA 434
City Council 910 Calle Negocio, San Clemente, CA 92673
http://san-clemente.org
Exhibit A
The City of San Clemente’s responses to findings and recommendations in the 2023- 2024 Orange County Grand Jury " Emerging Opportunities in South County Water/Wastewater Systems " Report are as follows:

Findings and Responses
F3 SOCWA’s member agencies have widely diverse populations, requirements, and revenues. This has led to conflicts over governance, facility operation, and control, affecting the evolving potential for wastewater reuse.

Staff Recommended Response:

Agree.

F4 There is currently no unified strategy for the future of water/wastewater provision in South Orange County.

Staff Recommended Response:

The City of San Clemente disagrees partially with this finding. In general, most agencies are planning to have supply reliability in the event of a 60-day water outage as recommended by Metropolitan Water District. South Orange County is highly reliant on imported water and historically agencies have worked collaboratively to make regional improvements to supply reliability through participation in projects, such as, Irvine Water District Interconnection to the Joint Regional Water Supply System for emergency use, Baker Treatment Plant, and Upper Chiquita Reservoir to name a few. There are other regional projects currently being planned to lower south county demand for imported water, such as, addition recycled water system expansion, interconnection/supply of recycled water to neighboring agencies, Cadiz, Doheny Desalination, and direct and indirect potable water reuse. While there is no one size fits all approach for the region, each agency evaluates its needs, resources, impacts to operating costs to implement and maintain projects, and future rate impacts to its customers.

With regard to wastewater, there are differing opinions and needs amongst the agencies regarding governance, operation, and reuse of wastewater. There is one common goal related to the continued operation and maintenance of the Aliso Creek and San Juan Creek Ocean Outfalls since they are needed by all south county agencies. Some agencies will have minimal to possibly no discharge to the ocean outfalls when their systems are functioning properly and during dry weather. There will continue to be a need for maintenance and use of the outfalls during plant outages, maintenance of the reuse systems, and during periods of wet weather.

Recommendations and Responses
R2 The OCGJ recommends that by January 1, 2025, LAFCO form a task force comprising representatives of affected water agencies to study the transformation of 435
City Council 910 Calle Negocio, San Clemente, CA 92673
http://san-clemente.org
Exhibit A
SOCWA and prepare a report on the future of the water/wastewater in South Orange County.

Staff Recommended Response:

The recommendation will not be implemented by the City of San Clemente because the recommendation is for another agency (LAFCO) to perform a study and prepare a report. If a task force is formed with representatives of affected water agencies regarding the transformation of SOCWA, the City of San Clemente will participate in the process.
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