San Clemente City Council
August 19, 2025

POLICY AND PROCEDURE
Subject: City Section 115 Pension
Investment Policy
Index: Finance & Administrative
Services
Number: 202-3
Effective Date: Prepared By: Finance & Administrative
Services
Supersedes: 202-3 Approved By:

1.0 PURPOSE:

1.1 115 Trust Purpose
The purpose of the City of San Clemente’s Section 115 Pension Investment Policy is to establish: (1) a plan and a process for funding current and future costs associated with the City of San Clemente’s Section 115 Pension Plan (hereafter referred to as the Pension Trust Fund) and its contractual obligations for pension related programs; and (2) create an appropriate set of objectives and goals regarding the investment of the assets of the City of San Clemente’s Pension Trust Fund.

Funds set aside in tThe City of San Clemente is allocating assets to a Section 115 Trust (the “Pension Trust Fund”, or the “Trust”). The Pension Trust Fund assets are safe guarded from diversion to other budgetary uses and generally may be invested in a broader range of securities than would typically be permitted for public agency operating funds, potentially increasing earnings. Therefore, higher returns can improve the City’s ability to meet future pension obligations. Retaining control of the funds in the Trust provides the flexibility to meet current or accrued pension liabilities based on the financial circumstances at that time. The City also controls the timing of contributions to the Trust.

The main investment objective of the Trust is to achieve long-term growth of Trust assets by maximizing long-term rate of return on investments and minimizing risk of loss.

1.2 Policy Purpose
The purpose of this Policy Statement is to achieve the following:
• Document investment objectives, performance expectations, and investment guidelines for Fund assets.

Attachment 1
738

• Establish an appropriate investment strategy for managing all Trust assets, including an investment time horizon, risk tolerance ranges, and asset allocation to provide sufficient diversification and overall return over the long-term time horizon of the Trust.
• Establish investment guidelines to control overall risk and liquidity. • Establish periodic performance reporting requirements to monitor investment results and confirm that the investment policy is being followed. • Comply with fiduciary standards, prudence, due diligence, and legal requirements for Trust assets.

2.0 ORGANIZATIONS AFFECTED:

All City departments/divisions

3.0 REFERENCES:
• Investment Advisory Act of 1940
• Civil Code Section 2261, et seq.
• Government Code Section 53600, et seq.
• Code of Ethics Policy, Administrative Policy #102-1

4.0 POLICY:

4.1 Thise policy seeks to (a) establish a framework for achieving an appropriate risk adjusted rate of return for the City of the City of San Clemente’s (“the City”) Pension Trust Fund assets and (b) is to invest in a Pension Trust Fund in a manner which will provide a market rate of return while meeting the financial obligations of the fund and conforming to all applicable State and City laws governing the investment of public funds.

4.1.1 Scope: This pension investment policy applies to all financial assets of the City of San Clemente’s Pension Trust Fund. These funds are accounted for monthly in the investment report presented to the Investment Advisory Committee.

4.1.2 Statement of Responsibilities: The following parties associated with the Pension Trust Fund shall discharge their respective responsibilities in accordance with all applicable fiduciary standards as follows: (1) in the sole interest of the Pension Trust Fund participants and beneficiaries; (2) with the care, skill, prudence and diligence under the circumstances then prevailing that a prudent individual acting in like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and of like aims; and (3) by diversifying the investments so as to minimize the risk of large losses.

4.1.2.1 City Investment Advisory Committee: The members of the City Investment Advisory Committee will review and propose a Section 739

115 Pension Investment Policy for the approval of the City Council and provide direction as to the investment strategy and for the Pension Trust Fund assets.

4.1.2.2 Investment Management Manager(s): The investment manager(s) are delegated the responsibility of investing theand managing the Pension Trust Fund’s assets in accordance with this Section 115 Pension Investment Policy and all applicable laws. Investment Managers are selected by the Investment Advisory Committee Consultant while PARS is the Investment Consultant and
Administrator. Each investment manager must either be; (1) registered under the Investment Company Act of 1940; (2) registered under Investment Advisors Act of 1940; (3) a bank, as defined in that Act; (4) an insurance company qualified under the laws of more than one state to perform the services of managing, acquiring or disposing of Fund assets; or, (5) such other person or organization authorized by applicable law or regulation to function as an investment manager.

4.1.2.3 Investment Consultant/Advisor: The investment
Consultant/Advisor (“Advisor”) is charged with advising the City Investment Advisory Committee on the selection of appropriate investments asset allocation, and providing performance analysis, and monitoring services.

The investment advisor (“Advisor”) shall assist advise the Board in Investment Advisory Committee in the investment process and to maintain compliance with this Policy Statement. The Advisor may assist the Board Investment Advisory Committee in establishing investment policy objectives and guidelines. The Advisor will adjust asset allocation for the Trust subject to the guidelines and limitations set forth in this Policy Statement. The Advisor will also select investment managers (“Managers”) and strategies consistent with its role as a fiduciary for the Trust. The investment vehicles allowed may include mutual funds, commingled trusts, separate accounts, limited partnerships and other investment vehicles deemed to be appropriate by the Advisor. The Advisor is also responsible for monitoring and reviewing investment managers; measuring and evaluating performance; and other tasks as deemed appropriate in its role as Advisor for Trust assets. The Advisor may also select investments with discretion to purchase, sell, or hold specific securities, such as Exchange Traded Funds, that will be used to meet the Trust’s investment objectives. The Advisor shall never take possession of securities, cash or other assets of the Trust, all of which shall be held by the custodian. The Advisor must be registered with the Securities and Exchange Commission

4.1.2.4 Investment Custodian: The investment custodian is the company holding Pension Trust Fund assets. The custodian selected by the Trust 740

will maintain possession of physical securities and records of street name securities owned by the Trust, collect dividend and interest payments, redeem maturing securities, and effect receipt and delivery following purchases and sales. The custodian may also perform regular accounting of all assets owned, purchased, or sold, as well as movement of assets into and out of the Trust. The custodian will generally report on a monthly and quarterly basis the various assets and assist with the rebalancing of the asset classes.

4.1.2.5. A Trustee shall be appointed by the Trust. , such as a bank trust department, if the Trust does not have its own Trustees, to assume fiduciary responsibility for the administration of Trust assets; provided, however, that if the City shall have appointed an investment advisor, then any The trustee appointed under this paragraph shall have no authority with respect to selection of investments.

4.1.2.6 Fund Administrator. The Fund Administrator shall provide the Investment Advisory Committee with reports for the Committee to evaluate: (a) investment risk, (b) investment returns, and (c) investments returns of comparable benchmarks per investment sleeve.

4.2 Statement of Investment Philosophy & Process:

4.2.1 City Investment Advisory Committee: The City Investment Advisory Committee is committed to: (1) protecting the corpus of the Pension Trust Fund; (2) obtaining adequate investment returns in order to protect and pay the benefits promised to the participants; (3) complying with applicable law; and (4) controlling administrative costs.

4.2.2 Pension Trust Fund: The Fund shall be managed in a prudent manner recognizing risk and return trade-offs, while concerned with avoiding undue risk. Accordingly, investments shall be chosen to maximize the return on invested assets and overall safety of funds over the long term. Sufficient liquidity shall also be maintained to fund expenses and benefit payments.

4.3 Investment Objectives: The Investment Objectives for the Pension Trust Fund will be for the asset value, is growth, exclusive of contributions or withdrawals., to grow over the long run and earn, Expected growth will be achieved through a combination of investment income and capital appreciation., The a rate of return (time-weighted total return gross of fees for periods under evaluation) tracking the will be tracked against designated benchmarks at a minimal cost utilizing a passive income strategy.

The investment objectives of the Trust are as follows:
• To invest assets of the Trust in a manner consistent with the following fiduciary standards: (a) all transactions undertaken must be for the sole interest of Trust beneficiaries, and (b) assets are to be diversified in order to minimize the impact of large losses from individual investments. 741

• To provide for funding for (a) contributions to CalPERs and CSCERP (see section 6.2), and anticipated withdrawals on a continuing basis for payment of benefits and (b) reasonable expenses of for operationg of the Trust. • To enhance the value of Trust assets in real terms over the long-term time horizon through asset appreciation and income generation, while maintaining a reasonable investment risk profile.
• Subject to performance expectations over the long-term, to mMinimize principal fluctuations over the Time Horizon (as defined below). • To achieve a long-term level of return commensurate with contemporary economic conditions and equal to or exceeding the investment objective set forth in this Policy Statement under the section labeled “Performance Expectations”.

4.3.1 Performance Objectives:

4.3.1.1 Total Fund Objective: The objective of the Pension Trust Fund is: (a) to invest in assets and achieve returns comparable to other similarly allocated Pension Trust Funds; (b)and exceeding the returns of the Pooled City Investments; and (c) maintaining adequate liquidity needs of the fund sufficient to meet requirements.

4.3.1.2 Total Fund Relative-Return Expectation – Pension standard: The total fund rReturn goal is to meet or exceed the actuarial assumption rate or discount rate over an appropriate time horizon multiple year period.

4.3.1.3 Rate of Relative Return Expectation – Benchmark standard: The objective of the total fund is to earn a rate of return of the indices weighted in accordance with the current target asset allocation. Return goal is to meet or exceed applicable indices on individual investments and portfolio basis, while controlling risk.

4.3.1.4 Investment RiskDiversification: The objective of the investment policy is to mManage portfolio risk through a diversified pool of assets while ensuring proper liquidity. dDiversification of assets.

Diversification can be achieved by asset class, maturities, credit quality, structure, public/private, and other dimensions.

4.4 Investment GuidelinesGeneral Investing Terms: The Pension Trust assets will be invested with a variety of diversification to minimize the risk of any one asset class and improve overall long-term performance, while comparing individual returns to benchmarks or indexes. The following asset classes may be participated in through mutual fund, exchange traded funds, or other investment options to minimize costs. 742

Within this section of the Policy Statement, several terms will be used to articulate various investment concepts. The descriptions are meant to be general and may share investments otherwise considered to be in the same asset class. They are:
"Growth Assets" -
aA collection of investments and/or asset classes whose primary risk and return characteristics are focused on capital appreciation. Investments within the Growth Assets category can include income and risk mitigating characteristics, so long as the predominant investment risk and return characteristic is capital appreciation.

Examples of such investments or asset classes are: domestic and international equities or equity funds, private or leveraged equity, and certain real estate investments. "Income Assets" -
aA collection of investments and/or asset classes whose primary risk and return characteristics are focused on income generation. Investments within the Income Assets category can include capital appreciation and risk mitigating characteristics, so long as the primary investment risk and return characteristic is income generation.

Examples of such investments or asset classes are: fixed income securities, guaranteed investment contracts, and certain real estate investments. "Real Return Assets" -
aA collection of investments and/or asset classes whose primary risk and return characteristics are focused on real returns, net of inflation. Investments within the Real Return category may include, but are not limited to, inflation protected securities, commodities, certain real estate investments, natural resources, and liquid alternatives.

4.4.1 “Time Horizon”:

The Trust’s investment objectives are based on a long-term investment horizon (“Time Horizon”) of five years or longer. Interim fluctuations should be viewed with appropriate perspective. The City has adopted a long-term investment horizon such that the risks and duration of investment losses are carefully weighed against the longterm potential for appreciation of assets. However, this portfolio of assets is viewed by the City as the first pool of assets that would be utilized to support pension expenses. As such, the time horizon for this portfolio could be less than five years based on budget conditions, or any increase in expenses arising from CalPERS.

4.4.2 “Liquidity and Diversification”:

In general, the Trust may hold some cash, cash equivalent, and/or money market funds for near-term Trust benefits and expenses (the “Trust Distributions”).

Remaining assets will be invested in longer-term investments and shall be diversified with the intent to minimize the risk of long-term investment losses. Consequently, the total portfolio will be constructed and maintained to provide diversification with regard to the concentration of holdings in individual issues, issuers, countries, 743

governments or industries.

4.4.3 “Rebalancing Philosophy”:

The asset allocation range established by this Policy Statement represents a long-term perspective. As such, rapid unanticipated market shifts or changes in economic conditions may cause the asset mix to fall outside Policy Statement ranges. When allocations breach the specified ranges, the Advisor will rebalance the assets within the specified ranges. The Advisor may also rebalance based on market conditions.

4.4.4 “Risk Tolerance”:

Subject to investment objectives and performance expectations, the Trust will be managed in a style that seeks to minimize principal fluctuations over the established Time Horizon.

4.4.5 “Performance Expectations”:

The performance objective for the Trust over the long-term, five years or longer, is expected to have an annual rate of return on Trust assets that will be commensurate with the then prevailing investment environment. Measurement of this return expectation will be judged by reviewing returns in the context of industry standard benchmarks, peer universe comparisons for individual Trust investments and blended benchmark comparisons for the Trust in its entirety.

4.5 Asset Allocation: The City believes that to achieve the greatest likelihood of meeting the Trust’s investment objectives and the best balance between risk and return for optimal diversification, assets will be invested in accordance with the targets for each asset class as follows to achieve an average total annual rate of return that is equal to or greater than the Trust’s target rate of return over the long-term, as described in the section titled “Performance Expectations”.

Asset Weightings
Asset Classes Range Target
Growth Assets
Domestic Equity 25% - 65% 45.0%
International Equity 12% - 40% 22.5%
Other 0% - 20% 7.5%
Income Assets
Fixed Income
Other
10% - 30%
0% - 10%
23%
0%
Real Return Assets 0% - 10% 0%
Cash Equivalents 0% - 20% 2%
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4.6 Selection of Investment Managers
The Advisor shall prudently select appropriate Managers to invest the assets of the Trust.

Managers must meet the following criteria:
• The Manager must provide historical quarterly performance data compliant with Global Investment Performance Standards (GIPS®), Securities & Exchange Commission (“SEC”), Financial Industry Regulatory Agency (“FINRA”) or industry recognized standards, as appropriate.
• The Manager must provide detailed information on the history of the firm, key personnel, support personnel, key clients, and fee schedule (including most-favorednation clauses). This information can be a copy of a recent Request for Proposal (“RFP”) completed by the Manager or regulatory disclosure. • The Manager must clearly articulate the investment strategy that will be followed and document that the strategy has been successfully adhered to over time. • The investment professionals making the investment decisions must have a minimum of three (3) years of experience managing similar strategies either at their current firm or at previous firms.
• Where other than common funds such as mutual funds or commingled trusts are utilized, the Manager must confirm receipt, understanding and adherence to this Policy Statement and any investment specific policies by signing a consent form provided to the Manager prior to investment of Trust assets.

4.7 Guidelines for Portfolio Holdings

4.7.1 Direct Investments by Advisor: Every effort shall be made, to the extent practical, prudent and appropriate, to select investments that have investment objectives and policies that are consistent with this Policy Statement (as outlined in the following sub-sections of the “Guidelines for Portfolio Holdings”). However, given the nature of the investments, it is recognized that there may be deviations between this Policy Statement and the objectives of these investments.

4.7.2 Limitations on Portfolio Holdings Guidelines:

4.7.2.1 EQUITIES
No more than 5% of the total equity portfolio valued at market may be invested in the common equity of any one corporation; ownership of the shares of one company shall not exceed 5% of those outstanding; and not more than 40% of equity valued at market may be held in any one sector, as defined by Bloomberg (BB) Sector standards.

Domestic Equities. Other than the above constraints, there are no quantitative guidelines as to issues, industry or individual security diversification. 745

However, prudent diversification standards should be developed and maintained by the Manager.

International Equities. The overall non-U.S. equity allocation should include a diverse global mix that is comprised of the equity of companies from multiple countries, regions and sectors.

4.7.2.2 FIXED INCOME
Fixed income securities of any one issuer shall not exceed 5% of the total bond portfolio at time of purchase. The 5% limitation does not apply to issues of the U.S. Treasury or other Federal Agencies. The overall rating of the fixed income assets as calculated by the Advisor shall be investment grade, based on the rating of one Nationally Recognized Statistical Rating Organization (“NRSRO”).

Eligible Investments
• Debt obligations of the U.S. Government, its agencies, and Government Sponsored Enterprises
• Mortgage-Backed Securities (MBS)
• Asset Backed Securities (ABS)
• Collateralized Mortgage Obligations (CMO)
• Commercial Mortgage-Backed Securities (CMBS)
• Corporate debt securities issued by U.S. or foreign entities including, but not limited to, limited partnerships, equipment trust certificates and enhanced equipment trust certificates
• Municipal Bonds
• Fixed income mutual funds.
• Eligible instruments issued pursuant to SEC Rule 144a (only if the Client is a documented Qualified Institutional Buyer; QIB) Quality
The individual securities portfolio will maintain a minimum weighted average effective quality of A- at all times. At the time of purchase, individual securities shall have a minimum effective quality rating of BBB-.

For purposes of determining an effective rating, when three agencies rate a security (S&P, Moodys, Fitch) the middle rating will be used. When only two of the three agencies rate a security the lower of the two ratings will be used.

When only one agency rates a security that rating will be used.

Duration
The manager will maintain the portfolio duration within +/- 25% of the Bloomberg US Aggregate Bond Index duration at all times for the individual securities portfolio.

Diversification
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No more than 30% of the portfolio may be invested in securities issued under Rule 144A* without registration rights (no limit on Rule 144a securities with registration rights).
* Note: Rule 144A is an administrative rule under the SEC allowing, under certain circumstances, for qualified institutional investors to trade certain securities with other institutional investors without registering the trade with the SEC. Specifically, the rule allows private companies, both domestic and international, to sell unregistered securities, also known as Rule 144 securities, to qualified institution buyers (QIBs) through a broker-dealer.

4.7.2.3 OTHER ASSETS (ALTERNATIVES)
Diversifying Liquid Alternatives
Primary objective shall be to enhance the risk-return profile of the overall portfolio. This can be accomplished by using liquid alternative strategies that may enhance returns at a reasonable level of risk or reduce volatility while providing a reasonable level of return. These asset classes may differ from traditional public market asset classes due to the use of certain strategies including short-selling, leverage, and derivatives. Liquid alternatives may also invest across asset classes. For purposes of asset allocation targets and limitations, liquid alternatives funds will be categorized under the specific asset class of the fund. For example, a long/short U.S. equity fund will be categorized as “Other” in the Growth Assets category while a long/short credit fund will be categorized as “Other” in the Income Assets category. Multistrategy liquid alternatives funds that cannot be easily categorized under one asset class will be included in “Other” under either the Growth Assets or Income Assets category depending on the risk-return profile of the strategy.

Real Assets
Real assets are typically physical assets that have intrinsic worth due to their substance and properties. Real assets are primarily used for their lower correlation to traditional assets (i.e., stocks and bonds) and their inflation hedging properties. Categories of real asset investments include, but are not limited to, real estate, infrastructure, land, farmland, timberland, precious metals, and commodities. Public real assets are publicly traded and liquid. The benefit of lower correlation investments is that, when implemented correctly, these investments can potentially improve a portfolio’s expected risk-adjusted return over the long-term. The real assets category can be extended to include other forms of assets that offer similar inflation hedging properties such as pooled vehicles holding: commodities contracts, Treasury Inflation Protected Securities (“TIPS”), index-linked derivative contracts, certain forms of intellectual property, and the equity of companies in businesses thought to hedge inflation. For purposes of asset allocation targets and limitations, real assets may be categorized as “Other” under either the Growth Assets or Income Assets category or in the Real Return Assets category, depending on the nature and risk/return profile of the investment.
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4.7.2.4 CASH EQUIVALENTS
Cash equivalents shall be held in funds complying with Rule 2(a)-7 of the Investment Company Act of 1940.

Prohibited Investments
Except for purchase within authorized investments, securities having the following characteristics are not authorized and shall not be purchased: letter stock and other unregistered securities, direct commodities or commodity contracts, or private placements (with the exception of Rule 144A securities).

Further, derivatives, options, or futures for the sole purpose of direct portfolio leveraging are prohibited. Direct/physical ownership of real estate, natural resource properties such as oil, gas or timber and the purchase of collectibles is also prohibited.

Safekeeping
All assets of the Trust shall be held by a custodian approved by the Board Investment Advisory Committee for safekeeping of Trust assets. The custodian shall produce statements on a monthly basis, listing the name and value of all assets held, and the dates and nature of all transactions in accordance with the terms in the Trust Agreement. Investments of the Trust not held as liquidity or investment reserves shall, at all times, be invested in interest-bearing accounts. Investments and portfolio securities may not be loaned.

4.8 Control Procedures

4.8.1 Review of Investment Objectives: The Advisor shall review annually and report to the Board the appropriateness of this Policy Statement for achieving the Trust’s stated objectives. It is not expected that this Policy Statement will change frequently. In particular, short-term changes in the financial markets should not require an adjustment in this Policy Statement.

4.8.2 Review of Investment Performance: The Advisor shall report on a quarterly basis to the Quarterly Trust performance detail will be provided to the Board Investment Advisory Committee to review the investment performance of the Trust. In addition, the Advisor will be responsible for keeping the Board Investment Advisory Committee advised of any material change in investment strategy, Managers, and other pertinent information potentially affecting performance of the Trust.

The Advisor shall compare the investment results on a quarterly basis to appropriate peer universe benchmarks, as well as market indices in both equity and fixed income markets. Examples of benchmarks and indexes that will be used include the Russell 3000 Index for broad U.S. equity strategies; S&P 500 Index for large cap U.S. equities, Russell 2000 Index for small cap U.S. equities, 748

MSCI ACWI ex-U.S. Index for broad based non-U.S. equity strategies, MSCI Europe, Australasia, and Far East (EAFE) Index for developed markets international equities, Bloomberg US Aggregate Bond Index for fixed income securities, and the U.S. 91 Day T-bill for cash equivalents. The Russell 3000 Index will be used to benchmark the U.S. equities portfolio; the MSCI ACWI exU.S. Index will be used to benchmark the non-U.S. equities portfolio; the Bloomberg US Aggregate Bond Index will be used to benchmark the fixed income portfolio. The categories “Other” will be benchmarked against appropriate indices depending on the specific characteristics of the strategies and funds used.

4.8.3 Voting of Proxies: The Board Investment Advisory Committee recognizes that proxies are a significant and valuable tool in corporate governance. The voting rights of individual stocks held in separate accounts or collective, common, or pooled funds will be exercised by the investment managers in accordance with their own proxy voting policies. The voting rights of funds will be exercised by the Advisor.

5.0 DEFINITIONS:

None

6.0 PROCEDURE:

6.1 Investment Performance Review, Reporting and Evaluation:

6.1.1 Investment Advisory Committee: The City Investment Advisory Committee will review the investment results of the investment managers at least semiannually quarterly. Performance comparisons will be made against a representative performance universe and the performance objectives set forth in this policy statement appropriate benchmarks.

6.1.2 Review of Strategy: The City Investment Advisory Committee, with the assistance of the Iinvestment consultant Advisor shall periodically review the qualitative developments of each Iinvestment Manager. This evaluation should include: Changes in ownership, personnel turnover, adherence to investment style and philosophy, and any other qualities the City Investment Advisory Committee deem appropriate. This review should also include an assessment as to each investment manager operated within the Investment Policy scope.

6.1.3 Reporting: The quarterly investment report will include the assets held in the Pension Trust, the allocation percentages, and the quarterly returns, cash flows, and risk metrics. Information as to the quarterly disbursements will be included in the report and whether minimum liquidity requirements are met. 749

6.2 Use of Pension Trust Fund: Withdrawals will be recommended by the City Manager or designee and reviewed by the Investment Advisory Committee. Once approval from the Investment Advisory Committee has been received, it will be added as a City Council Agenda Item for approval. Funds as allowed by the Trust may be used for any of the following purposes:
• City’s annual UAL payment to CalPERS
• City’s annual normal cost payment to CalPERS
• Reimbursement to the City for CalPERS pension costs
• Additional Discretionary Payments to CalPERS
• City’s annual UAL payment to City of San Clemente Employee Retirement Plan (CSCERP)

6.3 Internal Control: In conjunction with the City’s independent annual financial audit, a review of actual and documented internal controls of the City’s investment program will be coordinated by the Investment Advisory Committee annually. The review will assure that internal controls are adequate and assure compliance with policies and procedures.

Any deviations resulting from this review will be reported to the Investment Advisory Committee.

6.4 Policy Changes: The investment consultant shall advise the City Investment Advisory Committee of any restrictions within this Investment Policy which may prevent the investment manager(s)/consultant from achieving the objectives and goals set forth herein. Any violation of the investment guidelines or other sections of this Investment Policy discovered by the investment consultant in the preparation of its regular performance review shall be reported immediately to the City Investment Advisory Committee and discussed at their next regularly scheduled meeting.

6.5 Review and Revisions: The City Investment Advisory Committee has the ability to amend the Section 115 Pension Investment Policy as necessary to comply with changes in federal and/or state law as these changes affect the investment of the Fund’s assets and such changes shall be reported to the City Council. This policy will be reviewed on an annual basis by the City Investment Advisory Committee and any revisions or modifications made thereto recommended by the Committee and approved by the City Council. Invested funds in should have ample liquidity to meet any operational needs as determined by the Investment Advisory Committee.
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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 19, 2025 Agenda Item: 11N.

Submitted By: Public Works
Prepared By: Amir K. Ilkhanipour, P.E., Principal Civil Engineer Subject:
..titl e

CONSIDERATION OF A RESOLUTION APPROVING AND AUTHORIZING THE CITY

MANAGER TO EXECUTE A MAINTENANCE AGREEMENT WITH THE ORANGE COUNTY

FLOOD CONTROL DISTRICT (OCFCD) AND COUNTY OF ORANGE REGARDING

MAINTENANCE AND OPERATIONAL RESPONSIBILITIES, INCLUDING COSTS, OF THE SEGUNDA DESHECHA CANADA CHANNEL (OCFCD FACILITY NO. M02), A REGIONAL

FLOOD CONTROL FACILITY/CULVERT UNDER CALLE DE LOS MOLINOS, AND FINDING

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

No additional expenses beyond current budgeted amounts. Upon execution of the Maintenance Agreement (Attachment 1) between the City, Orange County Flood Control District (OCFCD), and the County of Orange, maintenance and operational responsibilities, including costs that will be accordingly appropriated amongst the parties, with the County and OCFCD being responsible for operating and maintaining Bridge Number 55C0399 (Culvert) at Calle de Los Molinos and the Segunda Deshecha Canada Channel (OCFCD Facility No. M02), with the City maintaining responsibility for road and other facilities within Calle de Los Molinos.

Summary:

Staff, in collaboration with the OCFCD and
County of Orange, has negotiated the
attached Maintenance Agreement for
transfer of maintenance responsibilities of
the Segunda Deshecha Canada Channel
(OCFCD Facility No. M02) concrete box
under Calle de Los Molinos (the “Culvert”)
to OCFCD and County of Orange.

The City Council is being asked to consider
a resolution to approve the Maintenance
Agreement with the Orange County Flood
Control District and the County of Orange
for the Culvert.
751
Meeting Date: August 19, 2025 Agenda Item: 11N.

CITY OF SAN CLEMENTE 2
Background:

The Segunda Deshecha
Canada Channel
watershed’s tributary area
is approximately 2,652
acres. The Channel
generally transverses the
City in a northeasterly to
southwesterly direction,
starting from Avenida La
Pata, downstream along
Avenida Pico and finally
draining into the Pacific
Ocean just west of El
Camino Real in the North
Beach area. The adjacent areas of the Channel are considered a regional flood control facility that is owned and maintained by the City and OCFCD. Regional flood control facilities are generally owned and maintained by OCFCD only.

OCFCD owns and maintains certain reaches of the Channel west of the freeway, including upstream and downstream of the Culvert at Calle de Los Molinos. Currently, the Culvert at Calle de Los Molinos is within the City’s right-of-way and also maintained by the City. The Maintenance Agreement transfers the maintenance obligation and responsibilities of the Culvert to OCFCD.

The City will continue to maintain and operate the roadway on the surface.

Council Options:
 Adopt Resolution No. 25-128 (Attachment 2), approving and authorizing the City Manager to execute the Maintenance Agreement with the Orange County Flood Control District and County of Orange to transfer maintenance responsibilities of the Segunda Deshecha Canada Channel (OCFCD Facility No. M02) culvert at Calle de Los Molinos to Orange County Flood Control District and County of Orange and finding the project categorically exempt from the California Environmental Quality Act (CEQA).
 Modify and adopt Resolution No. 25-128.
 Continue the item and direct staff to provide additional information.  Do not adopt Resolution No. 25-128 and put the Project on hold.

Environmental Review/Analysis:

The 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 operation, maintenance and repairs to existing public facilities. 752
Meeting Date: August 19, 2025 Agenda Item: 11N.

CITY OF SAN CLEMENTE 3
Recommended Actions:

STAFF RECOMMENDS the City Council adopt Resolution No. 25-128, which will:
..recommendation

1. Find the project categorically exempt from CEQA under Class 1 (Existing Facilities, 14 CCR section 15301) of the State CEQA Guidelines; and

2. Approve and authorize the City Manager to execute the Maintenance Agreement with the Orange County Flood Control District and County of Orange for maintenance and operational responsibilities, including costs, of the Segunda Deshecha Canada Channel (OCFCD Facility No. M02) Culvert under Calle de Los Molinos.
..end
Attachments:

1. Maintenance Agreement

2. Resolution No. 25-128
Notification:

None.
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SEGUNDA DESHECHA CANADA CHANNEL (M02)
CALLE DE LOS MOLINOS BRIDGE 55C0399 MA#-080-______
CITY OF SAN CLEMENTE - 1 - 2.1.2021

MAINTENANCE AGREEMENT
This AGREEMENT (“Agreement”) is made as of _________, 2024 (“Effective Date”) by and between ORANGE COUNTY FLOOD CONTROL DISTRICT, a body corporate and politic, (“DISTRICT)”, the COUNTY OF ORANGE, a political subdivision of the state of California (“COUNTY”), and the CITY OF SAN CLEMENTE (“CITY”), a municipal corporation.

DISTRICT, COUNTY and CITY may sometimes hereinafter individually be referred to as “Party” or jointly as “Parties.”

RECITALS
A. Bridge Number 55C0399 is located within the local jurisdiction of the CITY and serves as a portion of the public roadway Calle de Los Molinos as it traverses over a subsurface segment of the Segunda Deshecha Canada Channel (OCFCD Facility No. M02) as illustrated on “Exhibit A,” attached hereto and by this reference made a part hereof (“Subject Property”).

B. DISTRICT and COUNTY do not have a vested property interest or right-of-way at the Subject Property. The CITY intends this Agreement to serve as the CITY’s written permission and authorization for the DISTRICT and/or COUNTY to enter upon the Subject Property and to perform work in accordance with the terms herein.

C. The Parties intend this Agreement to set forth the Parties’ understanding with respect to their respective responsibilities to operate and maintain infrastructure and facilities at the Subject Property and to ensure their joint use will not impede their respective operations. The Parties intend this Agreement to enable the DISTRICT to perform flood protection, flood control and channel/subsurface structural maintenance activities at the Subject Property in accordance with the Orange County Flood Control Act, California Water Code Appendix, section 36-1, et seq.

D. The Agreement further reflects the Parties’ shared objective that their respective work within the Subject Property will not unreasonably interfere with each other’s exercise of their respective rights and that each will endeavor to minimize the need in the future to impact the other’s facilities. Therefore, the Parties intend this Agreement to enable them to work collaboratively toward mitigating such impacts and to establish a mechanism by which they may cost share and reimburse each other for related costs incurred in accordance with the terms herein.

NOW, THEREFORE, the Parties agree:

The above Recitals are fully incorporated by this reference as though set forth in full.

1. DEFINITIONS
For the purposes of this Agreement, the following words are defined as follows, unless otherwise apparent from context:
a. “Bridge” means that certain bridge referenced by as Bridge Number 55C0399 located Attachment 1
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within the local jurisdiction of the CITY that serves as a portion of the public roadway Calle de Los Molinos as it traverses over a subsurface segment of the Segunda Deshecha Canada Channel.
b. “Channel” means that subsurface reinforced concrete box segment of DISTRICT’s Segunda Deshecha Canada Channel Facility No. M02 on the Subject Property located beneath the Bridge.
c. “CITY Representative” means the City’s Public Works Director / City Engineer, or their success or designee, who has the authority to perform actions on behalf of the CITY to carry out the terms in this Agreement.
d. “Days” means calendar days, unless otherwise specified. e. “Director” means Orange County’s Director of OC Public Works, or any successor agency thereto, or Director’s designee, who has the authority to perform actions on behalf of the COUNTY and/or DISTRICT to carry out the terms in this Agreement. f. “Installation” means any aerial, surface or subsurface utility or facility, other than the Channel, that has been or will be installed in, on or about the public road right-of-way, Road (as defined below) or Bridge.
g. “Road” means a portion of the public roadway Calle de Los Molinos on the Subject Property located above the Channel, including the fill over the Channel and beneath the Road surface and its appurtenances such as sidewalk, curb, gutter, signage and local drainage (including but not limited to any chutes or v-ditches and slopes).

2. TERM
The initial term of this Agreement shall be for twenty-five (25) years, commencing on the Effective Date, unless terminated earlier as provided herein. This Agreement will automatically renew annually for an additional one (1) year term with all the same covenants, terms and conditions provided herein unless either Party notifies the other in writing of its intention to terminate this Agreement at least one hundred eighty (180) days prior to the expiration of the then current initial or extended term.

3. DEFAULT AND TERMINATION
In the event of a Party’s breach of an obligation in this Agreement, the other Party may provide written notification to the offending Party of such breach. The offending Party shall have twenty (20) days after receipt of written notification to begin work to cure the breach identified in the written notification. If the offending Party fails to cure such breach within that 20-day period or if the Parties do not otherwise resolve the matter, the Party that sent the written notification may, at its sole discretion, take any of the following actions or combination thereof:
a. Waive the breach of the Agreement in writing. Any waiver under this provision shall not 755
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function as a waiver of any future breaches of this Agreement. b. Terminate this Agreement, as provided in Section 2, and in such circumstance all respective Parties shall complete and record a quitclaim of rights and interests created herein. c. Remedy the breach and charge the offending Party the cost of that remedial action as set forth herein.
d. Take legal action, in law or in equity, to remedy any default, to recover damages for any breach of this Agreement; to compel specific performance of this Agreement; or to obtain injunctive relief, a declaratory judgment or any other equitable remedy consistent with the purposes of this Agreement.

4. DISTRICT AND/OR COUNTY RIGHTS
CITY hereby grants to the DISTRICT and the COUNTY, and their respective successors and assigns, the right to enter the Subject Property for the purpose of maintaining, operating, repairing, improving, modifying, reconstructing and replacing the Channel and Bridge and those rights necessary for the proper maintenance and operation of the Channel and to permit any steps to be taken which the Director deems necessary or desirable to maintain, repair, improve, modify or reconstruct the Bridge, Channel or said facilities or such operations. The rights in this section, or any other section of this Agreement, shall be exercised by the Director, at the Director’s sole discretion. The Parties agree to record as an encumbrance on the Subject Property, a Memorandum of Agreement in a form substantially similar to that attached as Exhibit B to this Agreement, for the purpose of acknowledgment of this Agreement and to provide notice to the public of the appropriate Party to notify for matters concerning the Road, Bridge and Channel on the Subject Property.

5. DISTRICT AND/OR COUNTY USE
Each of DISTRICT and COUNTY (“DISTRICT/COUNTY”) agrees not to create, or permit to be created, any public or private nuisance with the Subject Property. In addition, DISTRICT/COUNTY agree to comply with all government laws and regulations in connection with their respective use of the Subject Property and agree that said use of the Subject Property shall be subject to all terms, conditions set forth in this Agreement, in addition to any other agreements between the CITY, and DISTRICT/COUNTY regarding use of the Subject Property.

Neither DISTRICT or COUNTY nor any agent, employee, contractor, operator or any other person or entity acting for or on behalf thereof shall incur any liability, including, but not limited to, loss of business, damage, destruction or relocation costs of the Road, Installations or impaired utility of the Subject Property for any action undertaken in the maintenance, repair, operation, improvement, modification or reconstruction of said flood control facilities. CITY agrees that should DISTRICT take any reasonable action in connection with the maintenance, repair, operation, improvement, modification or reconstruction of said Channel flood control facilities that requires the relocation, removal and/or replacement of any Installations either on a temporary or permanent basis, CITY shall incur all reasonable costs and expenses associated therewith. Except in an emergency situation, Director agrees to provide CITY with a minimum of one hundred eighty (180) days’ 756
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written notice prior to the commencement of any maintenance, repair, operation, improvement, modification or reconstruction of said Channel flood control or Bridge facilities that may require the relocation or removal of any of any Installations.

6. CITY USE
CITY promises and covenants to refrain from conducting, or permitting to be conducted, all activities within the Subject Property, of any sort, that might have the potential to, or would, interfere with the DISTRICT/COUNTY flood control operations and maintenance activities relating to, bordering or within the Channel.

CITY agrees to refrain from using the Subject Property in ways that would interfere with the use of the Subject Property by DISTRICT/COUNTY for the purposes set forth herein, and to prohibit third parties from engaging in all such activities within the Subject Property.

CITY agrees to require third parties use of the Subject Property to comply with all government laws and regulations in connection with said use and for any such use to be subject to all terms, conditions set forth in this Agreement.

CITY or third party construction or work for the installation of any systems within Channel, facilities or equipment within the Subject Property shall be subject to approval in writing by the Director (“Permit”) through Orange County Public Works’ Property Permit department in accordance with the Orange County Flood Control Act, California uncodified Water Code Act 5682, section 2, later codified as Water Code Appendix, section 36-2, which approval shall not unreasonably be withheld or delayed provided that such activities do not have the potential to, or would, interfere with the DISTRICT/COUNTY’s flood control operations and maintenance activities relating to, bordering or within the Channel. The Permit applicant shall render all normal processing with no fees therefor, prior to commencement of any work in, on, over, under, across or about the Subject Property; and upon completion of any such work, CITY shall immediately notify Director in writing of such completion. Routine road surface maintenance and road rehabilitation work including, but not limited to, pavement repairs and replacements, sidewalk repairs and replacements, curb and gutter repairs and replacements, and any other related road work is exempt from requiring a Permit. This routine surface and road maintenance work is referred to herein as “Routine Road Maintenance”.

No Permit, approval or consent given by DISTRICT/COUNTY shall affect or limit CITY obligations hereunder nor shall any such approvals or consents given by DISTRICT or COUNTY, be deemed approval as to compliance or conformance with applicable, governmental codes, laws, ordinances, rules, or regulations.

Director’s approval of construction and/or work plans in a Permit shall not be deemed approval from the standpoint of structural safety, suitability for purpose or conformance with building or other codes or other governmental requirements. DISTRICT/COUNTY are not responsible for permitting of any construction and/or maintenance, design, assumptions or accuracy of other parties’ submitted construction and/or maintenance plans. Director will rely on the professional expertise of the Engineer of Record when approving such construction and/or maintenance plans.

CITY acknowledges that built structures that induce loading on DISTRICT/COUNTY flood control 757
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structures pose a potential structural and safety problem for DISTRICT/COUNTY flood control structures. Notwithstanding the above, Calle de Los Molinos is a public street and other vehicles with heavy loading could use the roadway without CITY’s knowledge and that are not part of any CITY projects and therefore, are not a part of CITY’s responsibilities.

Should it be necessary for CITY to conduct any construction within Channel other than Routine Road Maintenance, inspection or maintenance activities requiring the disturbance of the subsurface of the Subject Property or requiring the use of any specialized vehicles or equipment, including but not limited to cranes, within, over, under or about the Subject Property, CITY agrees to notify Director in writing no fewer than sixty (60) days in advance of such planned activities, and obtain Director’s written approval of all plans by obtaining a permit through Orange County Public Works’ Property Permit department in accordance with the Orange County Flood Control Act, California Water Code Appendix, sections 36-1, et seq., with normal processing with no fees therefor, prior to commencement of any such activities. Said approval shall not be withheld or delayed unreasonably, nor shall said approval be necessary in any emergency situation or in conducting routine maintenance activities that do not involve use of DISTRICT/COUNTY property outside of the Subject Property. However, other than Routine Road Maintenance, CITY shall notify Director within ten (10) days following commencement of any emergency repair work, and if requested by Director, CITY shall secure a Permit for the purpose of documenting the emergency work.

7. CITY MAINTENANCE/OPERATIONS
CITY shall, at no cost to DISTRICT/COUNTY, keep and maintain the Subject Property (other than the Channel and DISTRICT/COUNTY-owned facilities, if any, within the Subject Property) in good and safe condition and in substantial repair, and shall at all times conduct all operations thereon in a safe and responsible manner. It shall be CITY’s responsibility to take all necessary actions to maintain the Subject Property in such condition to not interfere with the operation and flood control purposes of DISTRICT’s Channel. CITY, at no cost to DISTRICT/COUNTY, shall perform all installation operation and maintenance responsibilities, which shall include but is not limited to:
a. Maintaining the plantings and landscaping at a minimum of 18” from the Channel for a visual observation space at the top of the Channel with all trees a minimum of 10’ from the Channel wall, with root pruning and root barriers on the portion of root adjacent to the Channel;
b. Maintaining the Road and ensuring operation of Installations are in good and safe condition and in substantial repair, and shall at all times conduct all operations thereon in a safe and responsible manner;
c. Performing its operations within the Subject Property in ways to reduce leaf litter and debris from entering the Channel and to address other related water quality issues when notified in writing by the Director of a matter to address; d. Performing graffiti clean-up within the Subject Property and removal of any abandoned property or encampments from the Subject Property; and
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e. Accommodate drainage, run-off from adjacent parcels to the Channel.

Except for flood control operations and maintenance of the Channel and DISTRICT-owned facilities, DISTRICT/COUNTY shall have no obligation to maintain or make any repairs or replacements to any area in, on over under or about the Subject Property. DISTRICT/COUNTY shall also have no obligation to secure the Subject Property or to provide law enforcement oversight for the Subject Property. In the event CITY fails to maintain, make repairs, remove and/ or replace Installations that affect DISTRICT's ability to maintain the Channel or provide flood control, Director may notify the CITY in writing of the needed correction(s). Unless otherwise agreed upon in writing, within five (5) days of receipt, CITY shall correct the identified deficiencies or provide the Director evidence of CITY’s having commenced the necessary corrective measure(s). Should, in the Director's sole discretion, the CITY fails to correct the identified deficiency within a reasonable time, Director may notify the CITY that the DISTRICT/COUNTY will undertake and complete the necessary work. In such a case, the CITY shall remain fully responsible and liable for the repair, replacement and corrective measures; and, shall pay DISTRICT within thirty (30) days of receipt of an invoice to reimburse DISTRICT’s associated cost, including but not limited to, the cost of labor (overtime, overhead and burden), materials, and equipment, with a fifteen percent (15%) administration fee, and any collections costs. CITY agrees to indemnify, hold harmless, protect and defend DISTRICT/COUNTY pursuant to the terms in Section 10, from claims arising from DISTRICT/COUNTY performing any of CITY’s obligations under this AGREEMENT.

DISTRICT’s election to self-perform corrective work under this provision shall not bar DISTRICT/COUNTY from availing itself of other remedies available under law, equity or contract, including other remedies made available by this Agreement.

CITY shall also promptly, at its sole cost and expense, repair or replace to their condition prior to damage or destruction, any facilities, equipment or improvements on DISTRICT’S property located under, over, within or adjacent to the Subject Property that are damaged or destroyed by CITY directed, conducted or sponsored activities under this Agreement. If CITY fails to perform any such repair or restoration within thirty (30) days following written notice from Director to CITY, or as such repair or restoration period may be extended in writing by Director. DISTRICT/COUNTY may opt to make the necessary repair or restoration and the cost thereof, including but not limited to the cost of labor, materials, and equipment and a fifteen percent (15%) administration fee of such costs, shall be paid by CITY within thirty (30) days of invoice by the DISTRICT. DISTRICT’s election to self-perform corrective work under this provision shall not bar DISTRICT/COUNTY from availing itself of other remedies available under law, equity or contract, including other remedies made available by this Agreement.

The Parties agree to cooperate in the maintenance and operation of their respective facilities within the Subject Property by coordinating such activities. CITY shall designate in writing a representative (“Site Representative”) to Director. The Site Representative shall be responsible for the day-to-day operation and level of maintenance and general order of the Subject Property and any of Installations thereon. The Site Representative shall contact OC Public Works’/Operations & Maintenance by calling 714-955-0200 for any CITY activities that may affect DISTRICT/COUNTY use of the Subject Property, other than Routine Road Maintenance, at least 72 hours in advance of the commencement of such activities or as otherwise mutually agreed upon 759
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in writing. Likewise, DISTRICT/COUNTY shall contact CITY’s Site Representative for any DISTRICT activities that may affect CITY’s use of the Subject Property at least 72 hours in advance of the commencement of such activities or as otherwise mutually agreed upon in writing.

8. BRIDGE AND CHANNEL MAINTENANCE/OPERATIONS
DISTRICT/COUNTY shall, at no cost to CITY, keep and maintain the Subject Property (other than the Road, Installations and CITY-owned facilities) in good and safe condition and in substantial repair, and shall at all times conduct all operations thereon in a safe and responsible manner. It shall be DISTRICT/COUNTY’s responsibility to take all necessary actions to maintain the Subject Property in such condition so as to not unreasonably interfere with the CITY operations on the Subject Property.

In the event DISTRICT/COUNTY fail to maintain or make ordinary repairs to the Bridge or Channel within the Subject Property which affect CITY’s use in accordance with the terms herein, the CITY Site Representative may notify the Director in writing of the needed correction(s). Unless otherwise agreed upon in writing, within five (5) days of receipt of such notice, DISTRICT/COUNTY shall correct the identified deficiencies or provided the CITY Site Representative evidence of DISTRICT/COUNTY having commenced the necessary corrective measure(s). Should the DISTRICT/COUNTY fail to correct the situation within a reasonable time, CITY may notify the DISTRICT/COUNTY that CITY will undertake and complete the necessary work. In such case, DISTRICT/COUNTY shall remain fully responsible and liable for the repair, replacement and corrective measures; and, shall pay CITY within thirty (30) days of receipt of an invoice to reimburse CITY’s associated cost, including but not limited to, the cost of labor (overtime, overhead and burden), materials, and equipment, with a fifteen percent (15%) administration fee, and any collections costs. CITY’s election to self-perform corrective work under this provision shall not bar CITY from availing itself of other remedies available under law, equity or contract, including other remedies made available by this Agreement.

9. RELOCATION OF INSTALLATIONS
CITY agrees that in the event Director determines that any future Installation interfere with the operation, maintenance, replacement, or improvement of the Channel, flood control facilities or property, the CITY shall, within ninety (90) days of receipt of written notice from Director, and at CITY’s sole cost and expense arrange for the removal of the Installation from the Subject Property and any reinstallation within the Subject Property, if applicable and appropriate. For reinstallations within the Subject Property, if appropriate and applicable, DISTRICT agrees to affirm in writing that the relocation will not interfere with DISTRICT’s ability to implement its duties and responsibilities under the Orange County Flood Control Act and will not be a material imposition on DISTRICT. The costs and expenses of removal and, if applicable, relocation of CITY’s Installations shall be borne by CITY. However, in the event that expansion or reconstruction of the channel necessitates impacts to the road, City and District shall enter into a separate agreement delineating the responsibilities for each party with respect to cost and remediation of any impacts to the road.

10. HOLD HARMLESS
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CITY acknowledges the Subject Property is over, upon and about the Channel and may be subject to all hazards associated with flood conditions. CITY agrees to assume all risks, financial or otherwise, associated with CITY’s decisions to engage in activities over, on and about the Subject Property caused by or associated with DISTRICT’s flood control operations and the Channel.

CITY hereby releases and waives all claims and recourse against DISTRICT/COUNTY including the right of contribution for loss of or damage to property, or injury to or death of any person arising from, growing out of or in any way connected with or related to this Agreement, including any damage to or interruption of use of any of CITY’s equipment or facilities placed in, on, or about the Subject Property, caused by erosion, flood, or flood overflow conditions of the Channel, or caused by the operation, maintenance, repair, reconstruction, replacement, enlargement or improvement of the Channel, or caused by DISTRICT’S flood control operations, except claims arising from the concurrent active or sole negligence of DISTRICT/COUNTY, their officers, agents, employees and contractors.

CITY agrees to indemnify, defend with counsel reasonably approved in writing by DISTRICT/COUNTY’s Board of Supervisors, and hold harmless DISTRICT/COUNTY and their elected and appointed officials, employees, and agents (“DISTRICT/COUNTY INDEMNITEES”) and their property from all loss, injury, liability, damages, claims, costs and expenses, whether incurred by or made against DISTRICT, COUNTY or any of the DISTRICT/COUNTY INDEMNITEES (including attorney’s fees and court costs) in connection with (i) breach of this Agreement by the CITY or its elected and appointed officials, employees, representatives, member agencies, agents, contractors, operators, invitees, or any person authorized by CITY to conduct activities on the Subject Property (individually and collectively “CITY INDEMNITEES”); (ii) the willful misconduct or negligent acts or omissions of CITY, CITY INDEMNITEES or any of them relating to or connected with and/or implementation of the CITY operations on the subject property; and (iii) the accuracy of any materials, methodology and/or other documentation provided by CITY to DISTRICT/COUNTY, DISTRICT/COUNTY INDEMNITEES or any of them in furtherance of the implementation of the CITY operations on the Subject Property or in performance of this Agreement; provided, however, that (a) DISTRICT/COUNTY timely provides notice to the CITY upon becoming aware of any fact, condition or event which may reasonably give rise to CITY’s obligation to defend and indemnify DISTRICT/COUNTY under this section and, (b) nothing in this subparagraph shall operate to relieve DISTRICT/COUNTY or any DISTRICT/COUNTY INDEMNITEES from responsibility for, or to require their indemnification with respect to, any loss, injury, liability, damages, claims, costs or expenses to the extent determined by a court of competent jurisdiction to have been proximately caused by the willful misconduct or negligent acts or omissions of DISTRICT/COUNTY, the DISTRICT/COUNTY INDEMNITEES, any party acting on their behalf or under their direction.

DISTRICT/COUNTY jointly and severally agree to indemnify, defend with counsel reasonably approved in writing by the CITY, and hold harmless the CITY and its elected and appointed officials, employees, and agents (“CITY INDEMNITEES”) and their property from all loss, injury, liability, damages, claims, costs and expenses, whether incurred by or made against CITY or any of the CITY INDEMNITEES (including attorney’s fees and court costs) in connection with (i) breach of this Agreement by the DISTRICT/COUNTY or DISTRICT/COUNTY INDEMNITEES; 761
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(ii) the willful misconduct or negligent acts or omissions of DISTRICT/COUNTY or DISTRICT/COUNTY INDEMNITEES or any of them relating to or connected with and/or implementation of the rights granted herein or in performance of this Agreement; provided, however, that (a) CITY timely provides notice to the DISTRICT/COUNTY upon becoming aware of any fact, condition or event which may reasonably give rise to the DISTRICT/COUNTY obligation to defend and indemnify CITY under this section and, (b) nothing in this subparagraph shall operate to relieve CITY or any CITY INDEMNITEES from responsibility for, or to require their indemnification with respect to, any loss, injury, liability, damages, claims, costs or expenses to the extent determined by a court of competent jurisdiction to have been proximately caused by the willful misconduct or negligent acts or omissions of CITY, the CITY INDEMNITEES, any party acting on their behalf or under their direction.

If judgment is entered against DISTRICT/COUNTY and CITY by a court of competent jurisdiction because of the concurrent active negligence of DISTRICT/COUNTY and CITY, DISTRICT/COUNTY and CITY agree that liability will be apportioned as determined by the court.

No Party shall request a jury apportionment.

11. HAZARDOUS MATERIALS
A. Definition of Hazardous Materials
For purposes of this Agreement, the term “Hazardous Material(s)” shall mean any hazardous or toxic substance, material, product, byproduct, or waste which is or shall become regulated by any governmental entity, including, without limitation, COUNTY, the State of California, or the United States government.

B. Use of Hazardous Materials
CITY or CITY INDEMNITEES shall not cause or permit any Hazardous Materials to be brought upon, stored, kept, used, generated, released into the environment or disposed of on, under, from or about the Subject Property (which for purposes of this clause shall include the subsurface soil and ground water).

C. CITY Obligations
If the presence of any Hazardous Materials on, under or about the Subject Property caused or permitted by CITY or CITY INDEMNITEES results in (i) injury to any person, (ii) injury to or contamination of the Subject Property (or a portion thereof), or (iii) injury to or contamination of any real or personal property wherever situated, CITY, at its sole cost and expense, shall promptly take all actions necessary or appropriate to return the Subject Property and/or other property to the condition existing prior to the introduction of such Hazardous Materials in, on, or about the Subject Property and to remedy or repair any such injury or contamination. Without limiting any other rights or remedies of DISTRICT/COUNTY under this Agreement, CITY shall pay the cost of any cleanup or remedial work performed on, under, or about the Subject Property as required by this Agreement or by applicable laws in connection with the removal, disposal, neutralization or other treatment of such Hazardous Materials caused or permitted by CITY or CITY INDEMNITEES. Notwithstanding the foregoing, CITY shall not take any remedial action 762
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in response to the presence, discharge or release, of any Hazardous Materials on, under or about the Subject Property caused or permitted by CITY or CITY INDEMNITEES, or enter into any settlement agreement, consent decree or other compromise with any governmental or quasi-governmental entity without first obtaining the prior written consent of Director on behalf of DISTRICT/COUNTY, which shall not be unreasonably withheld or delayed. All work performed or caused to be performed by CITY as provided for above shall be done in good and workmanlike manner and in compliance with plans, specifications, permits, and other requirements for such work approved by Director.

12. BEST MANAGEMENT PRACTICES
The Parties shall conduct operations under this Agreement so as to assure that pollutants do not enter municipal storm drain systems which systems are comprised of, but are not limited to curbs and gutters that are part of the street systems (“Stormwater Drainage System”), and to ensure that pollutants do not directly impact “Receiving Waters” (as used herein, Receiving Waters include, but are not limited to, rivers, creeks, streams, estuaries, lakes, harbors, bays and oceans).

The Santa Ana and San Diego Regional Water Quality Control Boards have issued National Pollutant Discharge Elimination System (NPDES) permits (“Stormwater Permits”) to the DISTRICT/COUNTY and cities within Orange County, including CITY, as co-permittees (hereinafter collectively referred to as “County Parties”) which regulate the discharge of urban runoff from areas within the COUNTY, including the Subject Property. DISTRICT/COUNTY have enacted water quality ordinances that prohibit conditions and activities that may result in polluted runoff being discharged into the Stormwater Drainage System.

To assure compliance with the Stormwater Permits and water quality ordinances, DISTRICT/COUNTY have developed a Drainage Area Management Plan (“DAMP”) which includes a Local Implementation Plan (“LIP”) for each jurisdiction that contains Best Management Practices (“BMPs”) that parties using properties within Orange County must abide. As used herein, a BMP is defined as a technique, measure, or structural control that is used for a given set of conditions to manage the quantity and improve the quality of stormwater runoff in a cost-effective manner. These BMPs are found within the COUNTY’s LIP in the form of Model Maintenance Procedures and BMP Fact Sheets (the Model Maintenance Procedures and BMP Fact Sheets contained in the DAMP/LIP shall be referred to hereinafter collectively as “BMP Fact Sheets”) and contain pollution prevention and source control techniques to eliminate non-stormwater discharges and minimize the impact of pollutants on stormwater runoff.

The Parties shall, throughout the term of this Agreement, comply with the BMP Fact Sheets, as they exist now or are modified, and shall comply with all other requirements of the Stormwater Permits, as they exist at the time this Agreement commences or as the Stormwater Permits may be modified.

The Parties agree to maintain current copies of the BMP Fact Sheets in a location readily accessible to any or all Parties throughout the term of this Agreement.

A Party may propose alternative BMPs that meet or exceed the pollution prevention performance of the measures set forth in the BMP Fact Sheets. Any such alternative BMPs shall be submitted to 763
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the Director for review and approval prior to implementation.

Director may access the Subject Property and/or review the records of a Party or their respective contractor at any time to assure that activities conducted within the Subject Property comply with the requirements of this section. A Party may be required to implement a self-evaluation program to demonstrate compliance with the requirements of this section.

13. NOTICES
All notices, documents, correspondence and communications concerning this Agreement shall be addressed as set forth in this Section, or as the Parties may hereafter designate by written notice and shall be sent through the United States mail with postage prepaid. Any such mailing shall be deemed served or delivered forty-eight (48) hours after mailing. Either Party may change the address for notices by giving the other Party at least ten (10) days’ prior written notice of the new address.

Notwithstanding the above, either Party may also provide notices, documents, correspondence, or such other communications to the other by personal delivery or by Federal Express or similar courier service and so given shall be deemed to have been given upon receipt.

To DISTRICT/COUNTY:

Mr. Kevin Onuma
County Engineer
County of Orange
P.O. Box 4048
Santa Ana, CA 92702-4048
RE: Maintenance Agreement MA #__
To CITY:

Mr. David Rebensdorf
Public Works Director / City Engineer
City of San Clemente
910 Calle Negocio
San Clemente, CA 92673
RE: Maintenance Agreement MA #__

14. AUTHORITY
The Parties to this Agreement represent and warrant that this Agreement has been duly authorized and executed and constitutes a legally binding obligation of their respective organization or entity, enforceable in accordance with the terms herein.

15. LABOR CODE COMPLIANCE
The Parties acknowledge and agree that all improvements or modifications required to be performed as a condition precedent to the commencement of the term of this Agreement or any such future improvements or modifications performed by or at the request of a Party shall be governed by, and performed in accordance with, the provisions of Article 2 of Chapter 1, Part 7, Division 2 of the Labor Code of the State of California (Sections 1770, et seq.). These provisions are applicable to improvements or modifications costing more than $1,000.

Pursuant to the provisions of Section 1773 of the Labor Code of the State of California, the Orange County Board of Supervisors has obtained the general prevailing rate of per diem wages and the general prevailing rate for holiday and overtime work in the locality applicable to this Agreement 764
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for each craft, classification, or type of workman needed to execute the aforesaid improvements or modifications from the Director of the State Department of Industrial Relations. Copies of said prevailing wage rates may be obtained from the State of California, Department of Industrial Relations.

The Parties hereby agree to pay or cause its contractors and/or subcontractors to pay said prevailing wage rates at all times for all improvements or modifications to be completed within the Subject Property, and the Parties herein agree to post, or cause to be posted, a copy of the most current, applicable prevailing wage rates at the site where the improvements or modifications are performed.

Prior to commencement of any improvements or modifications, the Party performing the work shall provide Director with the applicable certified payroll records for all workers that will be assigned to the improvements or modifications. Said payroll records shall contain, but not be limited to, the complete name, address, telephone number, social security number, job classification, and prevailing wage rate for each worker. Said Party shall also provide, Director bi-weekly updated, certified payroll records for all workers that include, but not be limited to, the weekly hours worked, prevailing hourly wage rates, and total wages paid.

If a Party neglects, fails, or refuses to provide said payroll records to Director, such occurrence shall constitute a default under this Agreement and the other Parties, notwithstanding any other termination provisions contained herein, may terminate this Agreement following notice and an opportunity to cure the default in accordance with Section 3 of this Agreement. A Party’s failure to provide payroll records to the Director will result in withholding of payment until such payroll records are provided. Withholding of payment in accordance with this provision shall not constitute a default under this Agreement.

16. RIGHT TO WORK AND MINIMUM WAGE LAWS
In accordance with the United States Immigration Reform and Control Act of 1986, the Parties shall require their respective employees that directly or indirectly service or conduct activities on the Subject Property pursuant to the terms and conditions of this Agreement, in any manner whatsoever, to verify their identity and eligibility for employment in the United States. Each Party shall also require and verify that its contractors or any other persons servicing or conducting construction activities on the Subject Property pursuant to the terms and conditions of this Agreement, in any manner whatsoever, verify the identity of their employees and their eligibility for employment in the United States.

Pursuant to the United States of America Fair Labor Standard Act of 1938, as amended, and State of California Labor Code, Section 1178.5, each Party shall pay no less than the greater of the Federal or California Minimum Wage to all its employees that directly or indirectly service the Subject Property, in any manner whatsoever. Each Party shall require and verify that all its contractors or other persons servicing the Subject Property on behalf of a Party also pay their employees no less than the greater of the Federal or California Minimum Wage.

Each Party shall comply and verify that its contractors comply with all other Federal and State of California laws for minimum wage, overtime pay, record keeping, and child labor standards pursuant to the servicing of the Subject Property or terms and conditions of this Agreement. 765
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CALLE DE LOS MOLINOS BRIDGE 55C0399 MA#-080-______
CITY OF SAN CLEMENTE - 13 - 2.1.2021
Notwithstanding the minimum wage requirements provided for in this section, each Party where applicable, shall comply with the prevailing wage and related requirements, as provided for in Section 6 (Labor Code Compliance) of this Agreement.

17. PARTIAL INVALIDITY AND SURVIVAL
If any term, covenant, condition, or provision of this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remainder of the provisions hereof shall remain in full force and effect and shall in no way be affected, impaired, or invalidated thereby.

18. WAIVER OF RIGHTS
The failure of either Party to insist upon strict performance of any of the terms, covenants, or conditions of this Agreement shall not be deemed a waiver of any right or remedy that Party may have, and shall not be deemed a waiver of the right to require strict performance of all the terms, covenants, and conditions of the Agreement thereafter, nor a waiver of any remedy for subsequent breach or default under term, covenant, or condition of the Agreement. Any waiver, in order to be effective, must be signed by the Party whose right or remedy is being waived.

19. ATTORNEYS’ FEES
In the event of a dispute between the Parties concerning claims arising out of this Agreement, or in any action or proceeding brought to enforce or interpret any provision of this Agreement or where any provision hereof is validly asserted as a defense, each Party shall bear its own attorneys’ fees and costs.

20. COST SHARING
CITY and Director may mutually agree in writing to collaborate on activities within the Subject Property in order to fulfill their respective obligations as contemplated herein or perform their operations jointly, by sharing related costs and paying or reimbursing the other accordingly.

Notwithstanding the above, the mere act of cost sharing shall not result or be construed to be a Party assuming the other’s responsibilities or changing its liability from what is set forth in this Agreement. Written cost-sharing documents between the CITY Site Representative and the Director as contemplated within this Section shall not constitute an amendment to this Agreement.

A Party seeking a cost-share payment from the other Parties must satisfy the requirements set forth in Section 21 below.

21. PAYMENT TERMS
Invoices, reconciliations and the final statement to the other Parties shall include the following, as applicable, for a Party to receive payment from the other Parties for allowable costs in accordance with the terms herein:
a. Agreement Number MA#;
b. Itemization of expenditures; specifying the percent and amount to be reimbursed with 766
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CALLE DE LOS MOLINOS BRIDGE 55C0399 MA#-080-______
CITY OF SAN CLEMENTE - 14 - 2.1.2021
supporting documentation with documentation of the Director and CITY Site Representative written approval of an engineer’s estimate prior to commencement of work; c. Adequate detail describing all work completed with documentation of the Director and CITY Site Representative written approval prior to commencement of work; and d. Signature by an authorized agent certifying the accuracy of the included information.

The Parties agree to pay requests for payment received in accordance with the terms herein within thirty (30) days of receipt thereof, unless otherwise extended by the Director and CITY Representative in writing.

22. COUNTERPARTS/ELECTRONIC SIGNATURES
This Agreement may be executed in any number of counterparts, which together shall constitute one instrument. This Agreement may be executed electronically with the same force and effect as original, ink signatures.
[SIGNATURES ON FOLLOWING PAGE]
767
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CALLE DE LOS MOLINOS BRIDGE 55C0399 MA#-080-______
CITY OF SAN CLEMENTE - 15 - 2.1.2021
IN WITNESS WHEREOF, the Parties have executed this Agreement the day and year first above written.

Approved as to Form
Office of the County Counsel
Orange County, California
By: ____________________________
Deputy
Date: _________________________

DISTRICT
Orange County Flood Control District,
a body corporate and politic
By: _____________________________
Chairman of the Board of Supervisors
Orange County, California
Signed and certified that a copy of this
document has been delivered to the Chair
of the Board per G.C. Sec. 25103,
Reso 79-1535
ATTEST:
__________________________________
Robin Stieler
Clerk of the Board of Supervisors
Orange County Flood Control District
Orange County, California
Approved As to Form
By: ____________________________
Elizabeth A. Mitchell, City Attorney
ATTEST:

By: __________________________________
Laura Campagnolo, City Clerk
COUNTY
County of Orange,
a subdivision of the State of California
By: _____________________________
Chairman of the Board of Supervisors
Orange County, California
CITY
City of San Clemente,
a municipal corporation
By:
_____________________________
Andy Hall, City Manager
Date: _______________________
768
SEGUNDA DESHECHA CANADA CHANNEL (M02)
CALLE DE LOS MOLINOS BRIDGE 55C0399 MA#-080-______

EXHIBIT A

SUBJECT PROPERTY
769
SEGUNDA DESHECHA CANADA CHANNEL (M02)
CALLE DE LOS MOLINOS BRIDGE 55C0399 MA#-080-______
770
SEGUNDA DESHECHA CANADA CHANNEL (M02)
CALLE DE LOS MOLINOS BRIDGE 55C0399 MA#-080-______

EXHIBIT B

MEMORANDUM OF AGREEMENT
771

RECORDED AT THE REQUEST OF,
WHEN RECORDED MAIL TO:

County of Orange
OC Public Works
Real Estate Services
601 N. Ross Street
Santa Ana, California 92701
Attn: Flood Program Support
Mail Tax Statements as shown above THIS SPACE FOR RECORDER’S USE ONLY This is to certify that this document is exempt
from recording fees per Govt. Code Sec. 27383
and is exempt from Documentary Transfer Tax per Unincorporated Area Rev. & Taxation Code Sec. 11922. Incorporated, City of San Clemente By:

OC Public Works/Real Estate Services Project: Calle De Los Molinos Bridge 55C0399 Project Name: Segunda Deshecha Channel (M02)

MEMORANDUM OF AGREEMENT
THIS MEMORANDUM OF AGREEMENT ("Memorandum") is made as of __________, 2025, by and among the Orange County Flood Control District, a body corporate and politic (“District”), the County of Orange, a political subdivision of the State of California (“County”), and the City of San Clemente, a municipal corporation (“City”). District, County and City are each referred to herein as a “Party” and collectively as the “Parties.”

RECITALS
A. Reference is hereby made to that certain Master Agreement MA#080-#### (the “Agreement”), dated _____________, 2025, by and among the Parties, pursuant to Bridge Number 55C0399 located within the local jurisdiction of the City and serves as a portion of the public roadway Calle de Los Molinos as it traverses over a subsurface segment of the Segunda Deshecha Canada Channel (OCFCD Facility No. M02) as illustrated on “Exhibit A,” attached hereto and by this reference made a part hereof (“Subject Property”).

B. District and County do not have a vested property interest or right-of-way at the Subject Property. The CITY intends this Agreement to serve as the CITY’s written permission and authorization for the DISTRICT and/or COUNTY to enter upon the Subject Property and to perform work in accordance with the terms herein.

C. The Parties intend the Agreement to set forth the Parties’ understanding with respect to their respective responsibilities to operate and maintain infrastructure and facilities at the Subject Property and to ensure their joint use will not impede their respective operations. The Parties intend the Agreement to enable the DISTRICT to perform flood protection, flood control and channel/subsurface structural maintenance activities at the Subject Property in accordance with the Orange County Flood Control Act, California Water Code Appendix, section 36-1, et seq.

D. The Agreement further reflects the Parties’ shared objective that their respective work within the Subject Property will not unreasonably interfere with each other’s exercise of their respective rights and that each will endeavor to minimize the need in the future to impact the other’s facilities. Therefore, the Parties 772
intend the Agreement to enable them to work collaboratively toward mitigating such impacts and to establish a mechanism by which they may cost share and reimburse each other for related costs incurred in accordance with the terms herein.

E. The Parties desire to record this Memorandum so that third parties may have notice of the existence of the Agreement, and the obligation of the Parties to convey property rights as further set forth therein.

For good and valuable consideration, the receipt and sufficiency of which are acknowledged, the Parties hereby agree as follows:

1. Notice. The purpose of this Memorandum is to give notice of the existence of the Agreement and the need for all interested parties to inquire further about the terms and conditions of the Agreement. If there is any inconsistency between any provisions of this Memorandum and any provisions of the Agreement, the provisions of the Agreement shall control.

2. Cancellation of Memorandum. Upon the recordation of a quitclaim deed which is executed and acknowledged by the Parties hereto, this Memorandum shall no longer serve any purpose and it will no longer be necessary for third parties to have notice of the existence of the Agreement and/or this Memorandum. Upon recordation of a quitclaim, this Memorandum shall be nullified and of no further force or effect and this Memorandum and the Agreement shall not be matters of record with respect to the Subject Property. The Parties hereby authorize and direct any and all issuers of title insurance with respect to all or any portion of the Subject Property not to indicate the Memorandum or the Agreement as matters affecting the condition of title to all or any portion of the Subject Property following the recordation of the quitclaim deed described above.

3. Counterparts. This Memorandum may be executed in any number of counterparts. //
//
Signatures follow
773
Approved as to Form
Office of the County Counsel
Orange County, California
By: ________________________________
Deputy
Date: ______________________
DISTRICT:

ORANGE COUNTY FLOOD CONTROL DISTRICT
a body corporate and politic
By: __________________________________
Kevin Onuma, Director
OC Public Works

774

ACKNOWLEDGMENT
State of California
County of Orange
On __________________, 20___, before me, ______________________________, a notary public, personally appeared ________________________________________________________, who proved to me on the basis of satisfactory evidence to be the persons(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.
________________________________
Signature of Notary Public
775
Approved as to Form
Office of the County Counsel
Orange County, California
___________________________
Deputy
Date: _______________________
COUNTY:

COUNTY OF ORANGE
a political subdivision of the state of California
By: __________________________________
Kevin Onuma, Director
OC Public Works

776

ACKNOWLEDGMENT
State of California
County of Orange
On __________________, 20___, before me, ______________________________, a notary public, personally appeared ________________________________________________________, who proved to me on the basis of satisfactory evidence to be the persons(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.
________________________________
Signature of Notary Public
777
CITY:

CITY OF SAN CLEMENTE,
a municipal corporation
By: ______________________________
Andy Hall, City Manager
ATTEST:
________________________________
Laura Campagnolo, City Clerk
Approved as to Form
City of San Clemente
City Attorney
By: ______________________________
Elizabeth A. Mitchell, City Attorney
Date: ___________________________
778

ACKNOWLEDGMENT
State of California
County of Orange
On __________________, 20___, before me, ______________________________, a notary public, personally appeared ________________________________________________________, who proved to me on the basis of satisfactory evidence to be the persons(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.

WITNESS my hand and official seal.
________________________________
Signature of Notary Public
779
EXHIBIT "A" TO MEMORANDUM OF AGREEMENT

DEPICTION OF THE SUBJECT PROPERTY
780
781
Attachment 2
RESOLUTION NO. 25-128

A RESOLUTION AUTHORIZING THE CITY MANAGER TO

EXECUTE THE MAINTENANCE AGREEMENT WITH THE

ORANGE COUNTY FLOOD CONTROL DISTRICT
(OCFCD) AND COUNTY OF ORANGE FOR

MAINTENANCE AND OPERATIONAL RESPONSIBILITIES,

INCLUDING COSTS, OF THE SEGUNDA DESHECHA
CANADA CHANNEL (OCFCD FACILITY NO. M02), A

REGIONAL FLOOD CONTROL FACILITY, CULVERT

UNDER CALLE DE LOS MOLINOS 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 Segunda Deshecha Canada Channel (Channel), a reginal Orange County Flood Control District (OCFCD) Facility No. M02, traverses the City in a northeasterly to southwesterly direction, starting generally from Avenida La Pata, continuing downstream along Avenida Pico and finally draining into the Ocean just west of El Camino Real in the North Beach area; and
WHEREAS, the Segunda Deshecha Canada Channel watershed’s tributary area is approximately 2,652 acres; and
WHEREAS, throughout the City, the Channel is owned and maintained by the City and OCFCD, in different reaches of the Channel; and
WHEREAS, OCFCD owns and maintains the Channel in the downstream and upstream of the culvert at Calle de Los Molinos (Culvert); and WHEREAS, currently, the Culvert at Calle de Los Molinos is within the City’s right-of-way and also maintained by the City; and
WHEREAS, City staff has negotiated a Maintenance Agreement with the Orange County and Flood Control District and County of Orange to transfer the Culvert maintenance responsibilities to OCFCD and County of Orange, and City to continue the maintenance of the roadway on the surface.

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

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

SECTION 2. That based on a review of the record as a whole, the project is exempt from the California Environmental Quality Act (CEQA) under Class 1 (Existing Facilities, 14 782
Resolution No. 25-128 Page 2
CCR section 15301) of the State CEQA Guidelines because it would consist of operation, maintenance and repairs to existing public facilities and there is no possibility of a direct or foreseeable indirect significant impact on the environment.

SECTION 3. That Maintenance Agreement with the Orange County Flood Control District and County of Orange for maintenance and operational responsibilities, including costs, of the Segunda Deshecha Canada Channel (OCFCD Facility No.

M02) Culvert under Calle de Los Molinos is hereby approved.

SECTION 4. That the City of San Clemente City Manager, or his/her designee, is hereby authorized and directed to execute such Maintenance Agreement in a form substantially similar to that presented to the City Council on August 19, 2025.

SECTION 5. That the City of San Clemente City Manager, or his/her designee, is hereby authorized and directed to execute such other documents and take such other and further actions as are necessary and proper to accomplish the purposes of this resolution.

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, 2025.

ATTEST:
___________________________ __________________________
City Clerk of the City of Steve Knoblock, Mayor of the City San Clemente, California of San Clemente, California
783
Resolution No. 25-128 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. 25-128 was adopted at a regular meeting of the City Council of the City of San Clemente held on the 19th day of August, 2025, by the following vote:

AYES:

NOES:

ABSENT:

IN WITNESS WHEREOF, I have hereunto set my hand and affixed the official seal of the City of San Clemente, California, this _____ day of _________________, 2024. __________________________
CITY CLERK of the City of
San Clemente, California
Approved as to form:
___________________________
Elizabeth A. Mitchell, City Attorney
784