Santa Ana City Council
December 6, 2022

Submitted By: Michael L. Garcia, Executive Director of Community Development Approved By: Kristine Ridge, City Manager
City Council 10 – 4 12/6/2022
U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
WASHINGTON, DC 20410-5000

OFFICE OF PUBLIC AND INDIAN HOUSING

HOUSING AUTHORITY OF THE CITY OF SANTA ANA
20 CIVIC CENTER PLAZA
SANTA ANA, CA 92701
Dear Executive Director:

September 23, 2022
This is your final award notification for Housing Choice Voucher (HCV) Program vouchers under the Consolidated Appropriations Act 2022 (P.L. 117-103). Based on vouchers that were declined by other housing agencies, the number of vouchers may have increased minimally. Please contact us at [email protected] no later than seven calendar days following the date of this letter if you do not want to accept the additional vouchers.

Judson Brown
Executive Director
The Consolidated Appropriations Act 2022 (P.L. 117-103) appropriated $200 million for new incremental vouchers pursuant to a method, as determined by HUD, which may include a formula that may include such factors as severe cost burden, overcrowding, substandard housing for very lowincome renters, homelessness, and administrative capacity. The allocation method is required to include rural and urban areas. These vouchers will increase the authorized vouchers for your PHA, and fees can be used to expedite the leasing of these vouchers. PHAs seeking to use administrative fees to encourage owner participation and leasing of these vouchers, are encouraged to consult PIH Notice 2022-18.

These vouchers will provide housing assistance to approximately 19,300 individuals and/or families eligible under the HCV Program; however, the Act further provides HUD with the discretion to specify additional terms and conditions for the use of these vouchers to ensure that PHAs provide vouchers for use by survivors of domestic violence, or individuals and families who are homeless, as defined in section 103(a) of the McKinney-Vento Homeless Assistance Act (42 U.S.C. 11302(a)), or at risk of homelessness, as defined in section 401(1) of such Act (42 U.S.C. 11360(1)).

The following table provides the details for your agency’s Housing Choice Vouchers award:

HCV Award --> 38
Housing Assistance Payments Special Fees
$623,708 $28,500
Effective: October 1st, 2022 Effective: October 1st, 2022 Purpose and Main Activities:
https://www.hud.gov/sites/dfiles/PIH/documents/PIH2022-18.pdf.

Expected Outcomes, Beneficiaries and Subrecipients:

These funds cannot be sub-awarded
www.hud.gov espanol.hud.gov
EXHIBIT 1
City Council 10 – 5 12/6/2022
Danielle Bastarache
Deputy Assistant Secretary for
Public Housing and Voucher Programs
Sincerely
HUD will obligate 12 months (October 2022 – September 2023) of Housing Assistance Payments (HAP) but will only advance three months of monthly HAP beginning in October 2022. Subsequently, monthly HAP and ongoing administrative fee disbursements will be based on actual HAP expenses and leasing reported in the Voucher Management System (VMS), respectively. If your PHA requires additional HAP funds beyond this schedule, please contact your Financial Management Center (FMC) Financial Analyst.

Should you have questions about this award, please do not hesitate to contact us at [email protected].

Schedule of Obligations and Disbursements:

In addition, the Department will obligate Special Fees for each individual voucher, from which will advance 100% in a lump sum during the first week in October 2022.

Finally, the FMC will provide your agency with an amended Consolidated Annual Contributions Contract (CACC) that reflects the new incremental vouchers and funding. Your agency must follow applicable Housing Choice Voucher (HCV) program requirements, when administering these vouchers, including the regulations at 24 CFR part 982, and operating requirements set forth in PIH Notices 2022-29. For reporting requirement in VMS and FDS, please follow PIH Notice 2021-08 and corresponding REAC Accounting Briefs. These vouchers financial activity will be reported under Assistance Listing 14.871.

Enclosure
EXHIBIT 1
City Council 10 – 6 12/6/2022

CITY OF SANTA ANA HSG AUTH
20 CIVIC CENTER PLAZA
P.O. BOX 22030
SANTA ANA, CA 92701-2701
CA093
Dear Executive Director:

U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Financial Management Center
2380 McGee Street, Suite 400
Kansas City, MO 64108-2605

OFFICE OF PUBLIC AND INDIAN HOUSING
September 28, 2022
SUBJECT: Foster Youth to Independence – Obligation of Assistance FYI Initiative
This letter is to notify you that funds have been obligated to provide Foster Youth to Independence (FYI) vouchers to assistance eligible youth identified in the request for assistance submitted to HUD under the requirements of Notice PIH 2020-28, amended by Notice PIH 2021-26.

As with other new special purpose voucher funding, only three months of funding will be automatically scheduled for disbursement to your agency. Subsequent disbursements will be calculated and scheduled based on expenses reported in the Voucher Management System (VMS) as part of the regular monthly HAP disbursement. The terms of the funding, including the approximate amount of the initial monthly payment, are reflected in the enclosed table.

FYI vouchers do not “sunset” like the FYI Tenant Protection Vouchers (TPV) awarded under Notice 2019-18. Public housing agencies (PHAs) should continue to use FYI vouchers awarded under Notice PIH 2020-28/2021-26 for eligible youth upon turnover. If another eligible youth is not available and the PHA does not anticipate future eligible applicants, the PHA must provide notification to [email protected] and the PHA’s respective Financial Management Center (FMC) Financial Analyst. HUD will reduce the PHA’s HCV baseline to account for the return of FYI assistance. Individual participants are still subject to the 36-month limit in receiving assistance with the FYI voucher.

PHAs must maintain a special program code for FYI participants in line 2n of the Family Report (form HUD-50058) or line 2p of the MTW Family Report (form HUD-50058), as applicable. The special program code is “FYI.” As a reminder, PHAs should be responding to the homeless at admission field (line 4C), of the form as well. PHAs should also report the leasing and expense information for these vouchers in the VMS, Form HUD-52681B. The “Family Unification 2008/Forward – MTW” or “Family Unification – Non MTW” category, as appropriate for your PHA, must be used. Additional program-specific requirements are outlined and clarified in Notice PIH 2021-26.
www.hud.gov espanol.hud.gov
EXHIBIT 2
City Council 10 – 7 12/6/2022
2 Public housing agencies receiving an increment in excess of $100,000 in Budget Authority (BA) are required to submit Form HUD-50071, Certification of Payments to Influence Federal Transactions, and if applicable, Form SF-LLL, Disclosure of Lobbying Activities. If this letter notifies you of a renewal in excess of $100,000, and your PHA has not submitted the Form(s) HUD-50071 (and SF-LLL where applicable) for your current fiscal year; the documents must be submitted to your local field office and Financial Analyst at the Financial Management Center (FMC) within 30 days of the date of this letter.

Enclosed is your executed copy of the notice to amend the Consolidated Annual Contributions Contract (CACC) with revised funding exhibits reflecting the changes described above. The amendment notice and revised funding exhibits should be filed with your most recent executed CACC.

Form HUD-50071
https://www.hud.gov/sites/documents/50071.pdf
Form SF-LLL
https://www.hud.gov/sites/documents/19161_SF-LLL.PDF
If you have any questions, please contact your Financial Analyst [email protected].

Sincerely,
Enclosures
Jennifer Marshall
Division Director
These forms are located on the Internet at the following addresses:

EXHIBIT 2
City Council 10 – 8 12/6/2022
U. S. Department of Housing and Urban Development
Office of Public and Indian Housing
Section 8
Increment Number Table
Housing Choice Voucher Program
Budget
Authority
Assigned
Approximate
Monthly
Disbursement
Increment
Number
Program Effective Date Term
Funding
No. of Units
CA093VO0255 VO 25 $376,512 10/1/2022 12 $31,376
(The terms of the funding, including the approximate amount of the monthly payment, are reflected in the table above)
EXHIBIT 2
City Council 10 – 9 12/6/2022
Consolidated
Annual Contributions Contract
U.S. Department of Housing and Urban Development
Office of Public and Indian Housing
Housing Choice Voucher Program Section 8

HUD NOTICE TO HOUSING AGENCY AMENDING

CONSOLIDATED ANNUAL CONTRIBUTIONS CONTRACT
Housing Agency:

In accordance with Paragraph 2.c. of the Consolidated Annual Contributions Contract between HUD and the HA, you are notified that the funding exhibits of the Consolidated Annual Contributions Contract is hereby revised to add a new funding increment as provided in the attached revised funding exhibit. (This notice adds one or more funding increments listed on the attached funding exhibit.)
The revised funding exhibit is attached to this HUD notice. This revised funding exhibit replaces and revises the prior funding exhibit.

In accordance with Paragraph 2.d. of the Consolidated Annual Contributions Contract, this HUD notice and the attached funding exhibit constitutes an amendment to the Consolidated Annual Contributions Contract.

United States of America Secretary of Housing and Urban Development Date of Document:

Authorized Representative
Robert H. Boepple, Director
Financial Management Center
Form HUD-52520A (12/97)
CA093

CITY OF SANTA ANA HSG AUTH
9/28/2022
EXHIBIT 2
City Council 10 – 10 12/6/2022
ACC NUMBER: CA093
FIELD OFFICE: 9DPH

CITY OF SANTA ANA HSG AUTH
20 CIVIC CENTER PLAZA
HA FISCAL YEAR-END: 06/30 PROGRAM TYPE:

CA093
U. S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
PIH SECTION 8 - FUNDING EXHIBIT

PROGRAM-BASED
P.O. BOX 22030
SANTA ANA, CA 92701
HAP-Voucher Program
UNITS
BUDGET

AUTHORITY

CONTRACT
TERM

FIRST DAY OF
TERM

LAST DAY OF
TERM

FUNDING

INCREMENT NUMBER
CA093AF0133 6/1/2020 9/30/2020 4 989,648 N/A
CA093AFR220 9/1/2020 9/30/2020 1 36,391 N/A
CA093VO0217 6/1/2020 9/30/2020 4 12,160,415 2699
CA093AF0134 10/1/2020 10/31/2020 1 247,412 N/A
CA093VO0206 11/1/2019 10/31/2020 12 301,811 25
CA093VO0218 10/1/2020 10/31/2020 1 2,984,940 2699
CA093VO0220 11/1/2020 11/30/2020 1 1,127,700 N/A
CA093AF0137 11/1/2020 12/31/2020 2 498,894 N/A
CA093AF0139 12/1/2020 12/31/2020 1 28,443 N/A
CA093AFR320 12/1/2020 12/31/2020 1 1,849 N/A
CA093VO0212 3/1/2020 12/31/2020 10 1 100
CA093VO0213 3/1/2020 12/31/2020 10 1 100
CA093VO0214 3/1/2020 12/31/2020 10 1 5
CA093VO0219 11/1/2020 12/31/2020 2 5,969,153 2699
CA093VO0221 12/1/2020 12/31/2020 1 726 N/A
CA093VO0225 11/1/2020 12/31/2020 2 1 22
CA093VOPB01 1/1/2020 12/31/2020 12 802,467 75
CA093AF0138 1/1/2021 2/28/2021 2 498,894 N/A
CA093VO0226 1/1/2021 2/28/2021 2 6,376,136 2699
CA093AF0140 3/1/2021 3/31/2021 1 376,879 N/A
CA093VO0231 3/1/2021 3/31/2021 1 3,196,190 2699
CA093AFR420 4/1/2021 4/30/2021 1 64,570 N/A
CA093AF0141 4/1/2021 5/31/2021 2 515,068 N/A
CA093VO0232 4/1/2021 5/31/2021 2 6,416,114 2699
CA093AF0142 6/1/2021 9/30/2021 4 1,036,092 N/A
CA093AF0144 9/1/2021 9/30/2021 1 84,017 N/A
CA093AF0145 9/1/2021 9/30/2021 1 84,017 N/A
CA093AFR221 9/1/2021 9/30/2021 1 47,351 N/A
CA093VO0234 6/1/2021 9/30/2021 4 13,066,437 2699
EXHIBIT 2
City Council 10 – 11 12/6/2022

UNITS
BUDGET

AUTHORITY

CONTRACT
TERM

FIRST DAY OF
TERM

LAST DAY OF
TERM

FUNDING

INCREMENT NUMBER
CA093VOPR20 9/1/2021 9/30/2021 1 80,388 N/A
CA093AF0143 10/1/2021 10/31/2021 1 259,023 N/A
CA093VO0235 10/1/2021 10/31/2021 1 3,228,320 2699
CA093AF0147 11/1/2021 11/30/2021 1 217,884 N/A
CA093VO0236 11/1/2021 11/30/2021 1 3,228,323 2699
CA093AF0148 12/1/2021 12/31/2021 1 217,884 N/A
CA093VO0227 1/1/2021 12/31/2021 12 1 100
CA093VO0228 1/1/2021 12/31/2021 12 1 100
CA093VO0229 1/1/2021 12/31/2021 12 1 5
CA093VO0230 1/1/2021 12/31/2021 12 1 75
CA093VO0233 1/1/2021 12/31/2021 12 1 22
CA093VO0237 12/1/2021 12/31/2021 1 3,228,323 2699
CA093VO0247 12/1/2021 12/31/2021 1 47,248 N/A
CA093VO0238 1/1/2022 1/31/2022 1 3,349,016 2699
CA093AF0149 1/1/2022 2/28/2022 2 601,494 N/A
CA093VO0239 2/1/2022 2/28/2022 1 2,561,064 2699
CA093VO0240 2/1/2022 2/28/2022 1 787,952 N/A
CA093AF0150 3/1/2022 3/31/2022 1 300,747 N/A
CA093AFR321 3/1/2022 3/31/2022 1 69,531 N/A
CA093VO0222 4/1/2021 3/31/2022 12 344,259 25
CA093VO0245 3/1/2022 3/31/2022 1 3,349,016 2699
CA093AF0151 4/1/2022 4/30/2022 1 293,659 N/A
CA093VO0246 4/1/2022 4/30/2022 1 2,981,408 2699
CA093VO0248 4/1/2022 4/30/2022 1 435,684 N/A
CA093VOPR21 4/1/2022 4/30/2022 1 110,162 N/A
CA093AF0152 5/1/2022 5/31/2022 1 293,659 N/A
CA093AFR421 5/1/2022 5/31/2022 1 213,399 N/A
CA093VO0251 5/1/2022 5/31/2022 1 3,451,783 2699
CA093AF0153 6/1/2022 9/30/2022 4 1,220,404 N/A
CA093AFR122 9/1/2022 9/30/2022 1 78,583 N/A
CA093VO0252 6/1/2022 9/30/2022 4 13,347,397 2699
CA093AF0154 10/1/2022 10/31/2022 1 305,101 N/A
CA093AF0155 10/1/2022 10/31/2022 1 28,500 N/A
CA093VO0253 10/1/2022 10/31/2022 1 3,374,832 2699
CA093VO0241 1/1/2022 12/31/2022 12 1 100
CA093VO0242 1/1/2022 12/31/2022 12 1 100
CA093VO0243 1/1/2022 12/31/2022 12 1 5
CA093VO0244 1/1/2022 12/31/2022 12 1 75
CA093VO0249 4/1/2022 12/31/2022 9 1 25
CA093VO0250 1/1/2022 12/31/2022 12 1 21
EXHIBIT 2
City Council 10 – 12 12/6/2022

UNITS
BUDGET

AUTHORITY

CONTRACT
TERM

FIRST DAY OF
TERM

LAST DAY OF
TERM

FUNDING

INCREMENT NUMBER
CA093VO0254 10/1/2022 9/30/2023 12 623,708 38
CA093VO0255 10/1/2022 9/30/2023 12 376,512 25
EXHIBIT 2
City Council 10 – 13 12/6/2022
U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
WASHINGTON, DC 20410-5000

OFFICE OF PUBLIC AND INDIAN HOUSING
Dear Executive Director:

July 29 , 2022
I am pleased to notify you that your public housing agency (PHA) is eligible for new Mainstream vouchers and funding as authorized by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) (Public Law 116-136). The CARES Act provided that the Department of Housing and Urban Development (HUD) allocate additional vouchers to PHAs non-competitively to help them prevent, prepare for, and respond to coronavirus in their communities. Your PHA submitted an application requesting Mainstream vouchers using the criteria identified in PIH Notice 2022-07: “Mainstream Vouchers – Non-Competitive Opportunity for Additional Vouchers Authorized by the CARES Act and Extraordinary Administrative Funding.

HOUSING AUTHORITY OF THE CITY OF SANTA ANA
20 CIVIC CENTER PLAZA
P.O. BOX 22030
SANTA ANA, CA 92701
CA093
The enclosed table (see last page) shows the number of units and the budget authority awarded. The default effective date of your award will be September 1, 2022, unless you contact your Financial Analyst at the Financial Management Center (FMC) by August 12, 2022, to request an alternative effective date.

Your effective date may be the first of any month beginning July 2022 through November 2022.

Please remember, as with the regular voucher program, the awarded budget authority and number of units both serve as a cap. Your agency may only lease until you have reached the lower of your budget authority or number of units allocated. If you have money left but you have leased all the awarded units, this extra funding will go into your agency’s Mainstream Housing Assistance Payment (HAP) reserves. If you are on track to spend all of the awarded funding but still have units left, you must manage your funds in a responsible manner that will not result in a shortfall.

The FMC will provide your agency with an amended Annual Contributions Contract that reflects the obligation of funds and monthly disbursements amount to be scheduled. Initially, the first three months of disbursements will be automatically scheduled. Each disbursement will equal 1/12th of your award amount.

Thereafter, monthly disbursements will be scheduled based on monthly Mainstream expenses reported in the Voucher Management System (VMS). If you have not leased any vouchers by month three, you will not receive additional disbursements until VMS data shows you are incurring HAP expenses. If at any time such disbursements are not sufficient to cover your monthly expenses, your agency should contact your Financial Analyst at the FMC.

U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
WASHINGTON, DC 20410-5000

OFFICE OF PUBLIC AND INDIAN HOUSING
July 29 , 2022
https://www.hud.gov/sites/dfiles/PIH/documents/PIH2022-07.pdf www.hud.gov espanol.hud.gov
EXHIBIT 3
City Council 10 – 14 12/6/2022
To ensure that Mainstream families are recorded properly, you must record MS5 on line 2n of the form HUD-50058 (Family Report). Remember to accurately record families who are homeless at admission on line 4c of the HUD-50058. Mainstream vouchers and corresponding HAP expenses must also be accurately reported in VMS. The Mainstream Voucher Program is reported separately in FASS-PH under the CFDA code 14.879.

Danielle Bastarache
Deputy Assistant Secretary for
Public Housing and Voucher Programs
Sincerely
Please contact [email protected] if you have any questions. https://www.hud.gov/program_offices/public_indian_housing/programs/hcv/mainstream.

Your agency must follow all HCV program requirements when administering the Mainstream Voucher Program, including the regulations at 24 CFR part 982, and the requirements in PIH Notice 2022-07 and PIH Notice 2020-01:Revised Policies and Procedures for the Mainstream Voucher Program. Your PHA is required to follow relevant statutes, regulations, and HUD guidance.

Additional information regarding the Mainstream Voucher Program can be found at:
https://www.hud.gov/sites/dfiles/PIH/documents/PIH-2020-01.pdf EXHIBIT 3
City Council 10 – 15 12/6/2022
U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
WASHINGTON, DC 20410-5000

OFFICE OF PUBLIC AND INDIAN HOUSING
Number of Vouchers Voucher Funding Extraordinary Administrative Fee Funding
0 $0 $115,500
EXHIBIT 3
City Council 10 – 16 12/6/2022
Library
www.santa-ana.org/library
Item # 11
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
December 6, 2022
TOPIC: FY 22-23 Zip Books Program Grant
AGENDA TITLE:

Approve an Agreement and Appropriation Adjustment Recognizing Grant Revenue in an amount not to exceed $9,928 for the California State Library for the Zip Books Program

RECOMMENDED ACTION

1. Authorize the Library Services Director to execute a Grant Agreement via DocuSign, accepting grant funds in the amount of $9,928 for the Zip Books Program, subject to non-substantive changes approved by the City Manager and City Attorney.

2. Approve an appropriation adjustment to recognize $9,928 in grant revenue from the California State Library and appropriate $9,928 into the corresponding expenditure account to implement the program. (Requires five affirmative votes)

DISCUSSION
The Santa Ana Public Library was awarded a grant in the amount of $9,928 by the California State Library for its Zip Books Program.

The Zip Books Program is an alternative model for a interlibrary loan service that bridges the gap between a library’s regular collection development practice and a home delivery service. The purpose of the program is to 1) provide patrons with speedy access to books they might not otherwise be able to access through the library; and 2) offer a patron-driven collection development approach to a library’s usual process, resulting in a collection more closely matched to local community needs.

Under the program, Santa Ana Public Library patrons can request books and audiobooks that the Library does not currently have in its collection. The Library will orders the books from Amazon, the grant’s preferred vendor, and the books will then be shipped directly to the patron. Patrons return the books to the Library at the end of the loan period and the books are added to the Library’s collection.

City Council 11 – 1 12/6/2022
FY 22-23 Zip Books Program Grant
December 6, 2022

The grant funds must be fully expended by June 30, 2023. There is no match requirement for the grant.

The California State Library has requested the City submit the application via the online signature and agreement platform, DocuSign.

ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.

FISCAL IMPACT
An appropriation adjustment to recognize revenue and appropriate funds to the respective accounts is shown below:

Fiscal Year Accounting Unit
– Account Number
Fund
Description
Accounting Unit,
Account
Description
Amount
FY 22-23 15211002-52025 State
Grant-Direct
Public Library
Grant Revenue –
State Grants-Direct
$9,928.00
FY 22-23 15211150-63001 Public Library
Grant Fund
Public Library Grant
Miscellaneous
Operating
Expenses
$9,928.00

EXHIBIT(S)

1. Grant Agreement (for reference only)
Submitted By: Brian Sternberg, Executive Director of Library Services Approved By: Kristine Ridge, City Manager
City Council 11 – 2 12/6/2022
Library – Courts Building 916-323-9759
P.O. Box 942837 [email protected]
Sacramento, CA 94237-0001 www.library.ca.gov
10/03/2022
Brian Sternberg, Library Services Director
Santa Ana Public Library
26 Civic Center Plaza
Santa Ana, CA 92701
Subject: Zip Books Project (ZIP22-68)
Dear Mr. Sternberg:

We are pleased to approve the grant application for the Zip Books Project for a total of $9,928 in California Library Services Act funds to purchase books and prime membership.

Hard copies of this correspondence will not follow. Keep the entirety of the correspondence for your files and consider these award materials your original documents. For more information, please refer to the Zip Book Guidelines located on the State Library website.

Upon receipt of a completed claim form that is free of errors or inaccurate information, the State Library processes it for routing to the Office of the State Controller which ultimately issues the check. The total time for the claim form to be processed, routed, payment issued, and mailed can be up to eight weeks, but is often a shorter timeframe. If you still have not received payment after eight weeks, please contact your grant monitor.

The Grant Monitor assigned to your project is Monica Rivas. She is available to assist you throughout the year and she can be reached via email at [email protected].

Please stay in touch with your Grant Monitor throughout the award period. Read the enclosed award packet thoroughly and contact your Grant Monitor if you have any questions.

Best wishes for a successful project.

Respectfully yours,
Greg Lucas
California State Librarian
CC: Monica Rivas, [email protected]
Lena Pham, [email protected]
Cathryn Ramirez, [email protected]
DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 3 12/6/2022

STATE FUNDED GRANTS

AWARD AGREEMENT AND

CERTIFICATE OF COMPLIANCE
DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 4 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

TABLE OF CONTENTS
PROJECT SUMMARY 2

PROCEDURES AND REQUIRMENTS
A. Term of the Agreement 3
B. Scope of Work 3
C. Budget Detail 3
D. Narrative and Financial Reports 4
E. Claim Form and Payment 5
EXHIBIT A: TERMS AND CONDITIONS 7
EXHIBIT B: CERTIFICATION AND COMPLIANCE FORM 22
Certification 25
EXHIBIT C: STATE REIMBURSABLE TRAVEL EXPENSES 27
DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 5 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

PROJECT SUMMARY
AWARD AGREEMENT BETWEEN THE STATE LIBRARY and Santa Ana Public Library for the Zip Book Project.

AWARD AGREEMENT NUMBER ZIP22-68
This Award Agreement (“Agreement”) is entered into upon execution of this agreement by and between the California State Library (“State Library”) and Santa Ana Public Library, (“Grantee”).

This Award Agreement pertains to Grantee’s State-funded Zip Book Project.

The Library Development Services Bureau (“LDS”) of the State Library administers state and federal funds in the form of awards.

The Grantee was selected by the State Library to receive state grant funds in the amount of $9,928 through the process adopted by the State Library in administering such grants.

The State Library and the Grantee, for the consideration and under the conditions hereinafter set forth in the Grant Agreement, agree as follows:

DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 6 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

PROCEDURES and REQUIREMENTS
A. Term of the Agreement
The Grant term begins on the date of execution of the Agreement by both parties, until June 30, 2023. If completion of the project occurs prior to the end of the grant period, this will be the end date of the term of this agreement. Grant eligible program expenditures may begin no earlier than the start date. The project period ends on June 30, 2023, and all eligible program costs must be incurred by this date.

B. Scope of Work

1. Grantee agrees to perform all activities specifically identified in the Grantee’s application and submitted to the State Library in response to the Zip Book Project.

2. The following activities and deliverables to be performed by the Grantee include, but are not limited to the following:
 Maintain and keep records of expenditures related to the grant that are consistent with Generally Acceptable Accounting Practices (GAAP).  Make financial records available to the State Library upon request.  Work with the State Library staff to assure that funds are disbursed in compliance with the purpose of the grant.
 Prepare and submit required narrative and financial reports.  Procure equipment, and other supplies as needed for the project.  Issue contracts for services, personnel, and consultants as needed for the project.
 If applicable, make payments for services, including for hours worked and travel reimbursements, to consultants and contractors.
 Oversee the implementation of project activities.

C. Budget Detail
The State Library shall provide the Grantee funding for the expenses incurred in performing the Scope of Work and activities specified in the Grantee’s application. The Grantee shall request the distribution of grant funding consistent with its proposal and the budget worksheet that was included with the application. Under no circumstances shall payments exceed the total grant amount identified in this Agreement.

DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 7 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

D. Narrative and Financial Reports

1. The Grantee shall be responsible for submission of interim and final narrative and financial reports on the progress and activities of the project, to the California State Library, using the sample report documents provided by the California State Library.

2. All the reports must be current, include all required sections and documents, and must be approved by the Grant Monitor before any payment request can be processed. Failure to comply with the specified reporting requirements may be considered a breach of this Agreement and result in the termination of the Agreement or rejection of the payment request and/or forfeiture by the Grantee of claims for costs incurred that might otherwise have been eligible for grant funding. Any problems or delays must be reported immediately to the Grant Monitor. The financial reports shall reflect the expenditures made by the Grantee under the Agreement and may be incorporated into the same reporting structure as the narrative reports.

3. The reports shall be submitted by the following dates:

Reporting Period Report Due Date
July – March 1st Financial and Mid Project Program
Narrative Report Due
April 30, 2023
April – June Final Financial Report, Expenditure Detail Report and Final Program Narrative Report
Due
July 31, 2023

4. Failure to submit timely reports with the appropriate documentation by the due date may result in rejection of the payment request and/or forfeiture by the Grantee of claims for costs incurred that might otherwise have been eligible for grant funding.

5. The Grantee agrees to maintain records and supporting documentation pertaining to the performance of this grant, subject to possible audit for a minimum of five (5) years after final payment date or grant term end date, whichever is later. Please refer to Exhibit A, Terms and Conditions for more information.

E. Claim Form and Payment

1. The California State Library shall provide the Grantee payment as outlined in the payment schedule only if all requirements for claiming the funds as outline in this document have been met, and only for those activities and costs specified in the approved award application.

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2. The Grantee shall complete, sign, and submit Certification of Compliance form (Exhibit B) and the Financial Claim form (included in your award packet), to the California State Library within 14 days of receiving this award packet. These forms will be issued, signed, and submitted using the online signature and agreement platform, DocuSign, unless DocuSign is unallowable or inconsistent with practices and policies of the local jurisdiction. If the use of DocuSign is not acceptable to your organization, please contact your grant monitor regarding alternate options.

3. Any of the sums appearing under the categories in the approved budget may be adjusted with prior authorization from the California State Library Grant Monitor. This would be to increase the allotment with the understanding that there will be corresponding decreases in the other allotments so that the total amount paid by the California State Library to the Grantee under this Agreement shall not exceed the awarded amount, which shall be expended/encumbered during the grant period.

4. If the payment amount made by the California State Library exceeds the actual expenses incurred during the term of this Agreement, as reflected in the financial reports to be filed by the Grantee, the Grantee shall immediately refund the excess payment amount to the California State Library.

5. The Award payments will only be made to the Grantee. It is the Grantee’s responsibility to pay all contractors and subcontractors for purchased goods and services.

6. The Final Payment of 10% will be withheld and retained by the California State Library until all conditions agreed upon in this Agreement, including submission and grant monitor approval of the interim and final narrative and financial reports, have been satisfied. (If applicable)

7. Prompt Payment Clause
The California State Library will make payments to the Grantee in accordance with the Prompt Payment Clause under Government Code, section 927, et. seq.

The Grantee may typically expect payment within 45 days from the date a grant payment request is properly submitted and approved by the Grant Monitor.

8. Budget Contingency Clause
a. It is mutually agreed that if the Budget Act of the current fiscal year or any subsequent years covered under this Agreement does not appropriate sufficient funds for the program, this Agreement shall no longer be in full force and effect. In this event, the California State Library shall have no liability to pay any funds whatsoever to the Grantee or to furnish any other considerations under this Agreement and the Grantee shall not be obligated to perform any provisions of this Agreement.

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b. If funding for any fiscal year is reduced or deleted by the Budget Act for purposes of this Program, the California State Library shall have the option to either cancel this Agreement with no liability occurring to itself or offer an Agreement amendment to the Grantee to reflect the reduced amount.

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Santa Ana Public Library
Zip Book Project
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EXHIBIT A: TERMS and CONDITIONS

1. Accessibility: The State is responsible for ensuring that public websites are accessible to both the general public and state employees, including persons with disabilities. Grantee shall assist the State in meeting its responsibility. Therefore, all project materials generated by state funded programs must meet the California Accessibility Standards. Additionally, all project materials designed, developed, and maintained shall be in compliance with the California Government Code, sections 7405 and 11135, and the Web Content Accessibility Guidelines 2.0, or a subsequent version, as published by the Web Accessibility Initiative of the World Wide Web Consortium at a minimum Level AA success criteria.

However, if for some reason project material is not generated to be in compliance to meet these standards, please still submit it to the State Library. When submitting the material make sure to note that the material is not accessible by including “NOT ACCESSIBLE” in the file name.

The California State Library reserves the right to post project materials to its website that are in compliance with these standards.

2. Acknowledgment: The State of California and the California State Library shall be acknowledged in all promotional materials and publications related to the Statewide Broadband Services Program.
a. Grant award recipients must ensure that the State of California receives full credit as the source of funds and that the California State Library, likewise, is acknowledged as the administrator.
b. Publications and information releases about the project must credit the State of California. An appropriate statement for a publication or project press release is:
“This [publication/project] was supported in whole or in part by funding provided by the State of California, administered by the California State Library.”
Grantees must include the above statement in any publications, vehicle wraps, and promotional materials, including websites. If space is limited the State Library logo and the following shortened acknowledgement statement is acceptable:
“Funding provided by the State of California.”
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c. This credit line on products of a project, such as materials, is important to foster support from the public, and state funding sources. d. California State Library Logo: Use of the California State Library logo, which can be downloaded on the California State Library website, is required on any publication, vehicle wrap, or promotional material along with the above statement(s).
e. Photo Documentation: Digital photos are a great way to document the happenings of your project. It is recommended that you use a photo release form when taking photos of the public. You may use your library’s photo release form or contact your grant monitor for the State Library’s form.

3. Agency: In the performance of this Agreement the Grantee and its agents and employees shall act in an independent capacity and not as officers, employees, or agents of the California State Library. The Grantee is solely responsible for all activities supported by the grant. Nothing in this Agreement creates a partnership, agency, joint venture, employment, or any other type of relationship between the parties. The Grantee shall not represent itself as an agent of the California State Library for any purpose and has no authority to bind the State Library in any manner whatsoever.

4. Amendment: No amendment or variation of the terms of this Agreement shall be valid unless made in writing, signed by the parties, and approved as required.

No oral understanding or agreement not incorporated into this Agreement is binding on any of the parties. This Agreement may be amended, modified, or augmented by mutual consent of the parties, subject to the requirements and restrictions of this paragraph.

5. Applicable law: The laws of the State of California shall govern all proceedings concerning the validity and operation of this Agreement and the performance of the obligations imposed upon the parties hereunder. The parties hereby waive any right to any other venue. The place where the Agreement is entered into and place where the obligation is incurred is Sacramento County, California.

6. Assignment, Successors, and Assigns: The Grantee may not assign this Agreement or delegate its performance to any third-party person or entity, either in whole or in part, without the California State Library’s prior written consent. The provisions of this Agreement shall be binding upon and inure to the benefit of the California State Library, the Grantee, and their respective successors and assigns.

7. Audit and Records Access: The Grantee agrees that the California State Library, the Department of General Services, the State Auditor, or their designated representatives shall have the right to review, audit, inspect and copy any records and supporting documentation pertaining to the performance of this Agreement. The Grantee agrees to maintain such records for possible audit for a minimum of five (5) years after the final payment, or grant term end date, whichever is later, unless a longer period of records retention is stipulated, or until DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
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completion of any action and resolution of all issues which may arise as a result of any litigation, dispute, or audit, whichever is later. The Grantee agrees to allow the auditor(s) access to such records during normal business hours and to allow interviews of any employees who might reasonably have information related to such records. Further, the Grantee agrees to include a similar right of the State to audit records and interview staff in any subcontract related to performance of this Agreement.

Examples of audit documentation may include, but not limited to, competitive bids, grant amendments, if any, relating to the budget or work plan, copies of any agreements with contractors or subcontractors if utilized, expenditure ledger, payroll register entries, time sheets, personnel expenditure summary form, travel expense log, paid warrants, contracts and change orders, samples of items and materials developed with grant funds, invoices and/or cancelled checks.

8. Authorized Representative: Grantee and the California State Library mutually represent that their authorized representatives have the requisite legal authority to sign on their organization’s behalf.

9. Communication: All communications from either party, including an interim check-in at any time during the grant term, shall be directed to the respective grant manager or representative of the California State Library or Grantee. For this purpose, the following contact information is provided below:

Santa Ana Public Library
Brian Sternberg
26 Civic Center Plaza
Santa Ana, CA 92701
[email protected]
714-647-5296
California State Library
Monica Rivas
900 N Street
Sacramento, CA 95814
[email protected]
916-603-7159

10. Confidentiality: Grantee will maintain as confidential any material it receives or produces that is marked Confidential or is inherently confidential or is protected by privilege. Grantee agrees to alert the State Library to this status in advance, and State Library agrees to maintain this status in conformity with the Public Records Act.

11. Contractor and Subcontractors: Nothing contained in this Grant Agreement or otherwise shall create any contractual relation between the State and any contractor or subcontractors, and no contract or subcontract shall relieve the Grantee of his or her responsibilities and obligations hereunder. The Grantee agrees to be as fully responsible to the State for the acts and omissions of its contractors, subcontractors, volunteers, student interns and of persons either directly or indirectly employed by any of them as it is for the acts and omissions of persons directly employed by the Grantee. The Grantee’s obligation to pay its DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
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contractors and subcontractors is an independent obligation from the State’s obligation to make payments to the Grantee. As a result, the State shall have no obligation to pay or to enforce the payment of any monies to any contractor or subcontractor.

12. Copyright: Grantee owns and retains titles to any copyrights or copyrightable material from any original works that it creates within the scope of this Agreement in accordance with the federal Copyright Act. (17 U.S.C. 101, et seq.) Grantee is responsible for obtaining any necessary licenses, permissions, releases, or authorizations to use text, images, or other materials owned, copyrighted, or trademarked by third parties and for extending such licenses, permissions, releases, or authorizations to the California State Library pursuant to this section. Also, the California State Library may upload, post or transmit copyrighted material produced or purchased with grant funds on a California State Library website for public access and viewing.

13. Discharge of Grant Obligations: The Grantee's obligations under this Agreement shall be deemed discharged only upon acceptance of the final report by California State Library. If the Grantee is a non-profit entity, the Grantee’s Board of Directors shall accept and certify as accurate the final report prior to its submission to California State Library.

14. Dispute Resolution: In the event of a dispute, Grantee will discuss the problem informally with the Grant Monitor. If unresolved, the Grantee shall file a written “Notice of Dispute” with the State Library Grant Monitor within ten (10) days of discovery of the problem. Within ten (10) days of receipt, the Grant Monitor shall meet with the Grantee for purposes of resolving the dispute. Any dispute arising under the terms of this Agreement which is not disposed of within a reasonable period of time, the Grantee may bring it to the attention of the State Librarian or the designated representative. The decision of the State Librarian or designated representative shall be final. Unless otherwise instructed by the Grant Monitor, the Grantee shall continue with its responsibilities under this Agreement during any dispute.

15. Drug-free Workplace: The Grantee certifies under penalty of perjury under the laws of California, that the Grantee will comply with the requirements of the Drug-Free Workplace Act of 1990 (Gov. Code, § 8350 et. seq.) and will provide a drug-free workplace by taking the following actions:
a. Publish a statement notifying employees that unlawful manufacture, distribution, dispensation, possession, or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations.
b. Establish a Drug-Free Awareness Program to inform employees about all of the following:
1) The dangers of drug abuse in the workplace.

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2) The Grantee’s policy of maintaining a drug-free workplace; 3) Any available counseling, rehabilitation, and employee assistance programs.
4) Penalties that may be imposed upon employees for drug abuse violations.
c. Require that every employee who works on the Agreement will:
1) Receive a copy of the Grantee’s drug-free workplace policy statement.
2) Agrees to abide by the terms of the Grantee’s statement as a condition of employment on the Agreement.

Failure to comply with these requirements may result in suspension of payments under the Agreement or termination of the Agreement or both and grantee may be ineligible for award of any future state agreements if the California State Library determines that the grantee has made a false certification or violated the certification by failing to carry out the requirements as noted above.

16. Effectiveness of Agreement: This Agreement is of no force or effect until signed by both parties.

17. Entire Agreement: This Agreement supersedes all prior agreements, oral or written, made with respect to the subject hereof and, together with all attachments hereto, contains the entire agreement of the parties.

18. Exclusive Agreement: This is the entire Agreement between the California State Library and Grantee.

19. Executive Order N-6-22-Russia Sanctions: The Grantee shall comply with Executive Order N-6-22 (the EO) regarding Economic Sanctions against Russia and Russian entities and individuals. “Economic Sanctions” refers to sanctions imposed by the U.S. government in response to Russia’s actions in Ukraine, as well as any sanctions imposed under state law. The EO directs state agencies to terminate grant agreements with, and to refrain from entering any new grant agreements with, individuals or entities that are determined to be a target of Economic Sanctions. Accordingly, should the State determine Grantee is a target of Economic Sanctions or is conducting prohibited transactions with sanctioned individuals or entities, that shall be grounds for termination of this agreement. The State shall provide Grantee advance written notice of such termination, allowing Grantee at least 30 calendar days to provide a written response. Termination shall be at the sole discretion of the State.

20. Extension: The State Librarian or designee may extend the final deadline for good cause. The Grantee’s request for an extension of the grant period must be made in writing and received by the California State Library at least 30 days prior to the final deadline.

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21. Failure to Perform: The grant being utilized by the Grantee is to benefit the Zip Books Project. If the Grant Monitor determines the Grantee has not complied with this Agreement, the Grantee may forfeit the right to reimbursement of any grant funds not already paid by the California State Library, including, but not limited to, the ten percent (10%) withhold.

22. Federal and State Taxes: The State Library shall not:
a. Withhold Federal Insurance Contributions Act (FICA) payments from Grantee’s payments or make FICA payments on the Grantee’s behalf; or
b. Make Federal or State unemployment insurance contributions on Grantee’s behalf; or
c. Withhold Federal or State income taxes from Grantee’s payments Grantee shall pay all taxes required on payments made under this Agreement including applicable income taxes and FICA.

23. Force Majeure: Neither the California State Library nor the Grantee, its contractors, vendors, or subcontractors, if any, shall be responsible hereunder for any delay, default, or nonperformance of this Agreement, to the extent that such delay, default, or nonperformance is caused by an act of God, weather, accident, labor strike, fire, explosion, riot, war, rebellion, sabotage, flood, or other contingencies unforeseen by the California State Library or the Grantee, its contractors, vendors, or subcontractors, and beyond the reasonable control of such party.

24. Forfeit of Grant Funds and Repayment of Funds Improperly Expended: If grant funds are not expended, or have not been expended, in accordance with this Agreement, the State Librarian or designee, at his or her sole discretion, may take appropriate action under this Agreement, at law or in equity, including requiring the Grantee to forfeit the unexpended portion of the grant funds, including, but not limited to, the ten percent (10%) withhold, and/or to repay to the California State Library any funds improperly expended.

25. Fringe Benefit Ineligibility: Grantee agrees that neither the Grantee nor its employees and contract personnel are eligible to participate in any employee pension, health benefit, vacation pay, sick pay or other fringe benefit plan of the State of California or the State Library.

26. Generally Accepted Accounting Principles: The Grantee is required to use Generally Accepted Accounting Principles in documenting all grant expenditures.

27. Grant Monitor: The Grant Monitor’s responsibilities include monitoring grant progress and reviewing and approving Grant Payment Requests and other documents delivered to the California State Library pursuant to this Agreement.

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The Grant Monitor may monitor Grantee performance to ensure Grantee expends grant funds appropriately and, in a manner, consistent with the terms and conditions contained herein. The Grant Monitor does not have the authority to approve any deviation from or revision to the Terms and Conditions (Exhibit A) or the Procedures and Requirements unless such authority is expressly stated in the Procedures and Requirements.

28. Grantee: the government or legal entity to which a grant is awarded, and which is accountable to the California State Library for the use of the funds provided. a. The grantee will make reports to the State Librarian in such form and containing such information as may be required to ensure the proper used of funds consistent with the grantee’s application and award agreement. The grantee will keep such records and afford such access as the California State Library may find necessary to assure the correctness and verification of such reports.

29. Grantee Accountability: The Grantee is ultimately responsible and accountable for the manner in which the grant funds are utilized and accounted for and the way the grant is administered, even if the Grantee has contracted with another organization, public or private, to administer or operate its grant program. In the event an audit should determine that grant funds are owed to the California State Library, the Grantee is responsible for repayment of the funds to the California State Library.

30. Grantee Funds: It is mutually agreed that the Grantee is responsible for furnishing funds beyond the grant award that may be necessary to complete the project.

31. Independent Action: Grantee reserves the right to fulfill its obligations under this Agreement in an independent manner, at any location and at any time within the agreed-upon timeline. Grantee’s employees or contract personnel shall perform all services required by this Agreement, but their time need not be devoted solely to fulfilling obligations under this Agreement. Grantee shall furnish all equipment and materials used to meet its obligations and complete the Project. The State Library shall not provide any personnel or other resources beyond the grant award and is not required to provide training in connection with this Agreement.

32. Indemnification: Grantee agrees to indemnify, defend and save harmless the State of California, the California State Library and its officers, employees, and agents, from any and all claims, losses, and liabilities accruing or resulting to any and all contractors, subcontractors, suppliers, laborers and any other person, firm or corporation furnishing or supplying work services, materials, or supplies in connection with the performance of this Agreement, and from any and all claims and losses accruing or resulting to any person, firm or corporation who may be injured or damaged by Grantee in the performance of this Agreement.

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33. License to Use: The California State Library reserves a fully paid-up, royalty-free, nonexclusive, sub-licensable and irrevocable license to reproduce, publish, prepare derivative works, distribute, or otherwise use, and to authorize third parties to use, any material received or maintained by Grantee in connection with this Agreement. This includes intellectual property, with or without thirdparty rights. All such usages will be for public library and State governmental purposes:
a. The copyright in any work developed under this grant, sub-grant, or contract under this grant or sub-grant; and
b. Any rights of copyright to which a Grantee, sub-grantee, or a contractor purchases ownership with grant support.

34. Limitation of Expenditure: Expenditure for all projects must conform to the grantee’s approved budget and with applicable State laws and regulations. The total amount paid by the California State Library to the Grantee under this agreement shall not exceed $9,928 and shall be expended/encumbered in the designated award period.

During the award period, the grantee may find that the awarded budget may need to be modified. Budget changes, requests for additional funds, or requests for reductions in award funding must be discussed with the assigned State Library Grant Monitor and a Grant Award Modification may be required to be submitted according to the instructions. Approval is by the State Librarian or their designee. Adjustments should be reported on the next financial report. Any adjustments in approved budgets must be documented and documentation retained in project accounts.

35. Lobbying: Grantee confirms that the grant funds will not be used for the purposes of lobbying or otherwise attempting to influence legislation, as those purposes are defined by the U.S. Internal Revenue Code of 1986.

36. Non-Discrimination Clause: During this grant period, the Grantee and the Grantee’s contractors, and subcontractors shall not unlawfully discriminate, harass, or allow harassment against any employee or applicant for employment because of race, religious creed, color, national origin, ancestry, physical disability, mental disability, medical condition, genetic information, marital status, sex, age, sexual orientation, or military and veteran status. Grantee shall insure that the evaluation and treatment of contractors, employees and applicants for employment are free from such discrimination and harassment.

Additionally, Grantee, contractors, and subcontractors, if applicable, shall comply with the provisions of the Fair Employment and Housing Act (Gov. Code §12900 et seq.), the regulations promulgated thereunder (Cal. Code Regs., tit. 2, DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
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§11000 et seq.), the provisions of Article 9.5, Chapter 1, Part 1, Division 3, Title 2 of the Government Code (Gov. Code §§ 11135-11139.5), and the regulations or standards adopted by the California State Library to implement such article.

Grantee shall permit access by representatives of the Department of Civil Rights and the California State Library upon reasonable notice at any time during the normal business hours, but in no case less than 24 hours’ notice, to such of its books, records, accounts, and all other sources of information and its facilities as said Department or the California State Library shall require ascertaining compliance with this clause. Grantee, and its contractors, and subcontractors shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement. (See Cal. Code Regs., tit. 2, §11105.) Grantee shall include the nondiscrimination and compliance provisions of this clause in all contracts and subcontracts to perform work under the Agreement.

37. Notices: All notices and other communications in connection with this Agreement shall be in writing, and shall be considered delivered as follows:
a. Electronic Mail (E-mail): When sent by e-mail to the last e-mail address of the recipient known to the party giving notice. Notice is effective upon transmission.
b. DocuSign (e-signature platform): When sent via DocuSign a notification will be sent to the last e-mail address of the recipient known to the party giving notice. Notice is effective upon transmission.
c. Grants Management System: When sent via / uploaded to the California State Library’s Grants Management System a notification will be sent to the last e-mail address of the recipient known to the party giving notice.

Notice is effective upon transmission.
d. Personally: When delivered personally to the recipient’s physical address as stated in this Agreement.
e. U.S. Mail: Five days after being deposited in the U.S. Mail, postage prepaid, and addressed to recipient’s address as stated in this Agreement.

38. Order of Precedence: The performance of this Agreement shall be conducted in accordance with the Terms and Conditions, Procedures and Requirements, Certificate of Compliance, Project Summary, Activities Timeline, and Budget, of this Agreement, or other combination of exhibits specified on the Grant Agreement Coversheet attached hereto (collectively referred to as “Terms”).

Grantee’s California State Library-approved Application (Grantee’s Application) is hereby incorporated herein by this reference. In the event of conflict or inconsistency between the articles, exhibits, attachments, specifications, or DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
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provisions that constitute this Agreement, the following order of precedence shall apply:
a. Grant Agreement Coversheet and any Amendments thereto b. Terms and Conditions
c. Procedures and Requirements
d. Certificate of Compliance
e. Project Summary
f. Grantee’s Application (including Budget and Activities Timeline) g. All other attachments hereto, including any that are incorporated by reference.

39. Payment:
a. The approved Budget, if applicable, is attached hereto and incorporated herein by this reference and states the maximum amount of allowable costs for each of the tasks identified in the Project Summary and Activity Timeline included in the project application. California State Library shall provide funding to the Grantee for only the work and tasks specified in the Grantee’s Application at only those costs specified in the Budget and incurred in the term of the Agreement.
b. The Grantee shall carry out the work described in the Work Plan or in the Grantee’s Application in accordance with the approved Budget and shall obtain the Grant Monitor’s written approval of any changes or modifications to the Work Plan, approved project as described in the Grantee’s Application, or the approved Budget prior to performing the changed work or incurring the changed cost. If the Grantee fails to obtain such prior written approval, the State Librarian or designee, at his or her sole discretion, may refuse to provide funds to pay for such work or costs. c. The Grantee shall request funds in accordance with the funding schedule included in this agreement.
d. Ten percent (10%) will be withheld from the Payment Request (if applicable) and paid at the end of the grant term, when all reports and conditions stipulated in this Agreement have been satisfactorily completed. Failure by the grantee to satisfactorily complete all reports and conditions stipulated in this Agreement may result in forfeiture of any such funds withheld.
e. Lodgings, Meals and Incidentals: Grantee’s eligible costs are limited to the amounts authorized in the California State Administrative Manual (see Exhibit C or contact the Grant Monitor for more information). f. Payment will be made only to the Grantee.

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g. Reimbursable expenses shall not be incurred unless and until the grantee receives a Notice to Proceed as described in the Procedures and Requirements.

40. Personal Jurisdiction: The Grantee consents to personal jurisdiction in the State of California for all proceedings concerning the validity and operation of this Agreement and the performance of the obligations imposed upon the parties.

Native American Tribal grantees expressly waive tribal sovereign immunity as a defense to any and all proceedings concerning the validity and operation of this Agreement and the performance of the obligations imposed upon the parties.

41. Personnel Costs: Any personnel expenditures to be paid for with grant funds must be computed based on actual time spent on grant-related activities and on the actual salary or equivalent hourly wage the employee is paid for their regular job duties, including a proportionate share of any benefits to which the employee is entitled.

42. Pledge: This Agreement shall not be interpreted to create any pledge or any commitment by the State Library to make any other or further grants or contributions to Grantee, or any other person or entity in connection with the Project. It is mutually agreed that Grantee is responsible for furnishing funds beyond the grant award that may be necessary to complete outcomes or deliverables.

43. Privacy Protection: Both parties agree to protect the confidentiality of any nonpublic, personal information that may be contained in materials received or produced in connection with this Agreement, as required by Civil Code, section 1798, et. seq.

44. Prohibited Use: The expenditure under this program shall not be used to supplant Grantee efforts in other grant programs provided by the California State Library.

45. Public Records Act: Material maintained or used by the California State Library is considered “public record” under the Public Records Act (PRA) at Government Code, sections 6250, et. seq. This includes the Interim and Final reports, and any other written communications between the parties. Grantee agrees to ensure that all content contained in its written reports are appropriate for publication.

Said material, along with all other reports, documentation and data collected during the term of the Agreement, will be subject to disclosure unless it qualifies for exemption under the PRA in whole or in part. Grantee agrees to alert the State Library as to a basis for exemption if any exists.

46. Publicity Obligations: Grantee will notify the State Library of any promotional materials or publications resulting from the grant no later than five (5) days in DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
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advance of distribution, whether they are print, film, electronic, or in any other format or medium. Copies of all promotional materials will be provided to the State Library. Grantee will acknowledge the State Library’s support as noted above. Grantee agrees that the State Library may include information about this grant and its outcomes in its own annual reports, with specific reference to Grantee, and may distribute such information to third parties.

47. Records: Communications, grant related documents, data, original receipts, and invoices must be maintained by Grantee and shall be made available to the State Library upon request. Grantee agrees to maintain adequate grant program records and adequate financial records consistent with generally accepted accounting practices, and to retain all records for at least five (5) years after the end-of-term. The State Library may monitor or conduct an onsite evaluation of Grantee’s operation to ensure compliance with this Agreement, with reasonable advance notice.

48. Reduction of Waste: In the performance of this Agreement, Grantee shall take all reasonable steps to ensure that materials purchased or utilized in the course of the project are not wasted. Steps should include, but not be limited to the use of used, reusable, or recyclable products; discretion in the amount of materials used; alternatives to disposal of materials consumed; and the practice of other waste reduction measures where feasible and appropriate.

49. Reimbursement Limitations: Under no circumstances shall the Grantee seek reimbursement pursuant to this Agreement for a cost or activity that has been or will be paid for through another funding source. The Grantee shall not seek reimbursement for any costs used to meet cost sharing or matching requirements of any other California State Library funded program.

50. Reports and Claims: It is the responsibility of the grantee make the required reports and claims to the California State Library.
a. The grantee shall be responsible for submitting to the State Library Narrative Reports detailing progress and activities. The reports are due on the dates specified in the reporting schedule detailed in the Procedures and Requirements section.
b. The grantee shall be responsible for submitting to the State Library Financial Reports reflecting grantee expenditure activity. The reports are due on the dates specified in the reporting schedule detailed in the Procedures and Requirements section.
c. To obtain payment hereunder the grantee shall submit authorized claims provided by the State Library for that purpose, on each of the following mentioned dates for payment, and the California State Library agrees to DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 22 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

reimburse the Library as soon thereafter as State fiscal procedures will permit.
d. The final 10% of the grant award (if applicable) is payable only upon approval of all final reports and receipt of claim form. Failure to provide timely reports is a serious breach of an award recipient’s administrative duty under the award.
e. Payment will be provided to cover the expenditures incurred by the grantee for the project in the following manner:
o $9,928 upon execution of the agreement and submission of claim by the grantee organization.

51. Self-Dealing and Arm’s Length Transactions: All expenditures for which reimbursement pursuant to this Agreement is sought shall be the result of arm’slength transactions and not the result of, or motivated by, self-dealing on the part of the Grantee or any employee or agent of the Grantee. For purposes of this provision, “arm’s-length transactions” are those in which both parties are on equal footing and fair market forces are at play, such as when multiple vendors are invited to compete for an entity’s business and the entity chooses the lowest of the resulting bids. “Self-dealing” is involved where an individual or entity is obligated to act as a trustee or fiduciary, as when handling public funds, and chooses to act in a manner that will benefit the individual or entity, directly or indirectly, to the detriment of, and in conflict with, the public purpose for which all grant monies are to be expended.

52. Severability: If any part of this Agreement is found to be unlawful or unenforceable, such provisions will be voided and severed from this Agreement, but the remainder of the provisions in the Agreement will remain in full force and effect.

53. Site Visits: The Grantee shall allow the California State Library to access and conduct site visits, with reasonable notice, at which grant funds are expended and related work being performed at any time during the performance of the work and for up to ninety (90) days after completion of the work, or until all issues related to the grant project have been resolved. A site visit may include, but not be limited to, monitoring the use of grant funds, provide technical assistance when needed, and to visit the State funded project.

54. Termination: The Agreement shall be subject to termination by the State Librarian or designee upon notice to the Grantee at least thirty (30) days prior to the effective date of termination. In the event this agreement is terminated, the Grantee shall deliver to the State Librarian copies of all reports, accounting, data, and materials prepared up to the date of termination. The State Librarian shall determine and pay the Grantee for necessary and appropriate DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 23 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

expenditures and obligations up to the date of termination which have not been covered by prior installments previously paid to the Grantee. Upon such termination, the unused portion of the grant award must be returned to the California State Library within 45 days. If funding has been advanced to the Grantee, any unobligated balances, as determined by the State Librarian, shall be returned to the State Library within 45 days of the notice of termination.

55. Timeline: Time is of the essence to this Agreement. It is mutually agreed between the parties that the grant application and the timeline included therein are part of the Agreement.

56. Unused Funds: At the end-of-term Grantee agrees to return any unexpended or unaccounted for funds to the State Library, or to submit a written request for an extension of the grant period. Funds will be considered unexpended or unaccounted if they were: (1) not used for their intended purpose, or (2) used inconsistent with the terms of this Agreement.

Funds will also be considered unaccounted for, and must be returned, if the proposal outcomes or deliverables are materially incomplete by the end-of-term or earlier termination, as determined by the State Library in its sole discretion.

57. Waiver of Rights: California State Library shall not be deemed to have waived any rights under this Agreement unless such waiver is given in writing and signed by California State Library. No delay or omission on the part of California State Library in exercising any rights shall operate as a waiver of such right or any other right. A waiver by California State Library of a provision of this Agreement shall not prejudice or constitute a waiver of California State Library’s right otherwise to demand strict compliance with that provision or any other provision of this Agreement. No prior waiver by California State Library, nor any course of dealing between California State Library and Grantee, shall constitute a waiver of any of California State Library’s rights or of any of grantee’s obligations as to any future transactions. Whenever the consent of California State Library is required under this Agreement, the granting of such consent by California State Library in any instance shall not constitute continuing consent to subsequent instances where such consent is required and in all cases such consent may be granted or withheld in the sole discretion of California State Library.

58. Work Products: Grantee shall provide California State Library with copies of all final products identified in the Work Plan and Application. Grantee shall also provide the State Library with copies of all public education and advertising material produced pursuant to this Agreement.

DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 24 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

59. Worker’s Compensation: The State of California will not provide Workers’ Compensation insurance for Grantee or Grantee’s employees or contract personnel. If Grantee hires employees to perform services required by this Agreement, Grantee shall provide Workers’ Compensation insurance for them.

The Grantee is aware of Labor Code Section 3700, which requires every employer to be insured against liability for Workers’ Compensation or to undertake self-insurance in accordance with the Labor Code, and the Grantee agrees to comply with such provisions before commencing the performance of the work of this Agreement.

DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 25 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

EXHIBIT B: CERTIFICATION of COMPLIANCE FORM

1. AUTHORIZED REPRESENTATIVE: I certify that the authorized representative named below is the legally designated representative of the Grantee for this Grant Agreement and project and is authorized to receive and expend funds in order to administer this grant program.

2. I certify that all information provided to the California State Library for review in association with this award is correct and complete to the best of my knowledge, and as the authorized representative of the Grantee, I commit to the conditions of this award, and I have the legal authority to do so.

3. I certify that any or all other participants or contractors in the grant program have agreed to the terms of the application/grant award and have entered into an agreement(s) concerning the final disposition of equipment, facilities, and materials purchased for this program from the funds awarded for the activities and services described in the attached, as approved and/or as amended in the application by the California State Librarian.

4. The authorized representative, on behalf of the Grantee, certifies that the Grantee will comply with all applicable requirements of State and Federal laws, regulations, and policies governing this program, to include the requirements listed below in this Certification of Compliance Form.

5. The authorized representative, on behalf of the Grantee, hereby certifies to the California State Library, for an award of funds in the amount $9,928. This award will provide library services as set forth in the Project Application as approved and/or as amended by the California State Librarian.

6. STATEMENT OF COMPLIANCE: Grantee has, unless exempted, complied with the non-discrimination program requirements. (Gov. Code §12990 (a-f) and CCR, Title 2, Section 11102).

7. DRUG-FREE WORKPLACE REQUIREMENTS: Grantee will comply with the requirements of the Drug-Free Workplace Act of 1990 and will provide a drugfree workplace by taking the following actions:
a. Publish a statement notifying employees that unlawful manufacture, distribution, dispensation, possession, or use of a controlled substance is prohibited and specifying actions to be taken against employees for violations.
b. Establish a Drug-Free Awareness Program to inform employees about:

DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 26 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

1) the dangers of drug abuse in the workplace;
2) the person's or organization's policy of maintaining a drug-free workplace;
3) any available counseling, rehabilitation, and employee assistance programs; and,
4) penalties that may be imposed upon employees for drug abuse violations.
c. Every employee who works on the proposed Agreement will:
1) receive a copy of the company's drug-free workplace policy statement; and,
2) agree to abide by the terms of the company's statement as a condition of employment on the Agreement.

Failure to comply with these requirements may result in suspension of payments under the Agreement or termination of the Agreement or both and Grantee may be ineligible for award of any future State agreements if the department determines that any of the following has occurred: the Grantee has made false certification or violated the certification by failing to carry out the requirements as noted above. (Gov. Code § 8350 et. seq.)

8. CONFLICT OF INTEREST: Grantee needs to be aware of the following provisions regarding current or former state employees. If Grantee has any questions on the status of any person rendering services or involved with the Agreement, the California State Library must be contacted immediately for clarification.

Current State Employees (Pub. Contract Code § 10410):
a. No officer or employee shall engage in any employment, activity, or enterprise from which the officer or employee receives compensation or has a financial interest, and which is sponsored or funded by any state agency, unless the employment, activity or enterprise is required as a condition of regular state employment.
b. No officer or employee shall contract on his or her own behalf as an independent contractor with any state agency to provide goods or services.

Former State Employees (Pub. Contract Code § 10411):
a. For the two-year period from the date, he or she left state employment, no former state officer or employee may enter into a contract in which he or she engaged in any of the negotiations, transactions, planning, arrangements or any part of the decision-making process relevant to the contract while employed in any capacity by any state agency. b. For the twelve-month period from the date, he or she left state employment, no former state officer or employee may enter into a contract with any state agency if he or she was employed by that state agency in a policy-making position in the same general subject area as the proposed contract within the 12-month period prior to his or her leaving state service.

DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 27 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

If Grantee violates any provisions of above paragraphs, such action by Grantee shall render this Agreement void. (Pub. Contract Code § 10420).

Members of boards and commissions are exempt from this section if they do not receive payment other than payment of each meeting of the board or commission, payment for preparatory time and payment for per diem. (Pub.

Contract Code § 10430 (e)).

9. LABOR CODE/WORKERS' COMPENSATION: Grantee needs to be aware of the provisions which require every employer to be insured against liability for Worker's Compensation or to undertake self-insurance in accordance with the provisions, and Grantee affirms to comply with such provisions before commencing the performance of the work of this Agreement. (Labor Code § 3700).

10. AMERICANS WITH DISABILITIES ACT: Grantee assures the State that it complies with the Americans with Disabilities Act (ADA) of 1990, which prohibits discrimination on the basis of disability, as well as all applicable regulations and guidelines issued pursuant to the ADA. (42 U.S.C. 12101 et. seq.)

11. RESOLUTION: A county, city, district, or other local public body must provide the State with a copy of a resolution, order, motion, or ordinance of the local governing body which by law has authority to enter into an agreement, authorizing execution of the agreement.

12. PAYEE DATA RECORD FORM STD. 204: This form must be completed by all Grantees that are not another state agency or other governmental entity.

13. DRUG FREE WORKPLACE:
a. Continue to provide a drug-free workplace by complying with the requirements in 2 C.F.R. part 3186 (Requirements for Drug-Free Workplace (Financial Assistance)). In particular, the recipient must comply with drugfree workplace requirements in subpart B of 2 C.F.R. part 3186, which adopts the Government-wide implementation (2 C.F.R. part 182) of sections 5152-5158 of the Drug-Free Workplace Act of 1988 (P. L. 100-690, Title V, Subtitle D; 41 U.S.C. §§ 701-707).
b. This includes but is not limited to making a good faith effort, on a continuing basis, to maintain a drug-free workplace; publishing a drugfree workplace statement; establishing a drug-free awareness program for the employees; taking actions concerning employees who are convicted of violating drug statutes in the workplace.

14. ACCESSIBILITY: The organization receiving this award, as listed in the certification section below, and all program staff, will ensure all project materials will meet California accessibility standards.

15. NON-DISCRIMINATION: The organization receiving this award, as listed in the certification section below, and all program staff, agree to comply with all California non-discrimination laws.

DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 28 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

16. ACKNOWLEDGEMENT: The organization receiving this award, as listed in the certification section below, and all program staff, agree to comply with California State Library acknowledgement requirements.

Certification

ORGANIZATION
Name: Address (official and complete):

PROJECT COORDINATOR
Name:

Email: Phone:

GRANTTEE AUTHORIZED REPRESENTATIVE
Name: Title:

Email: Phone:

Signature: Date:

DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 [email protected]
Brian Sternberg
In Process
City Council 11 – 29 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

Authorized Representative Signature

ORGANIZATION
Name: Address (official and complete):

AUTHORIZED REPRESENTATIVE
Signature: Date:

Printed Name of Person Signing: Title:

STATE OF CALIFORNIA
Agency Name: California State Library Address: 900 N Street, Sacramento, CA 95814 Signature: Date:

Printed Name of Person Signing: Title: California State Librarian DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 Greg Lucas
10/12/2022
Brian Sternberg
In Process
ATTEST:
_________________________
Clerk of the Council

APPROVED AS TO FORM
SONIA R. CARVALHO
City Attorney
By: _________________________
Brandon Salvatierra
Deputy City Attorney
City Council 11 – 30 12/6/2022
Santa Ana Public Library
Zip Book Project
2022-2023 ZIP22-68

EXHIBIT B: STATE REIMBURSABLE TRAVEL EXPENSES
Rates are subject to change per State of California, Department of Human Resources Please Check State of California, Department of Human Resources Website for updated expenses:
http://www.calhr.ca.gov/employees/pages/travel-reimbursements.aspx Mileage:

Rate subject to change
$0.56 per mile – approved business/travel expense
Meals:

Receipts are required
$7.00 – Breakfast
$11.00 – Lunch
$23.00 – Dinner
$5.00 - Incidentals
Meals Note: Lunch can only be claimed if travel is more than 24 hours. Incidental charge may be claimed once for every 24-hour period and should cover incidental expenses, such as but not limited to, tip, baggage handling, etc.

Hotel:

Receipts are required
and MUST have a zero
balance.
$ 90.00 plus tax for all counties/cities not listed below $ 95.00 plus tax for Napa, Riverside, and Sacramento
Counties
$ 110.00 plus tax for Marin County
$ 120.00 plus tax for Los Angeles, Orange, and Ventura
Counties, and Edwards AFB. Excluding the city of Santa
Monica
$ 125.00 plus tax for Monterey and San Diego Counties
$ 140.00 plus tax for Alameda, San Mateo and Santa
Clara Counties
$ 150.00 plus tax for the City of Santa Monica
$ 250.00 plus tax for San Francisco County
Out of State: Prior authorization must be obtained, as well as three print-out hotel quotes. Actual receipt must be included with authorization and additional quotes.

Hotel Note: If the above approved reimbursable hotel rates cannot be secured, please contact your grant monitor to obtain an excess lodging form. This form must be approved prior to actual travel.

AIRLINE TICKETS:

Itinerary and receipts are
required
Actual reasonable fees pertaining to airline travel will be reimbursed. Business, First Class, or Early Bird Check-in fee is not an approved reimbursable expense.

DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 31 12/6/2022
September 19, 2022
RE: Contractor and Grantee Compliance with Economic Sanctions Imposed in Response to Russia’s Actions in Ukraine
Dear Grantee,
You are receiving this notification because you currently have an active grant through the California State Library.

On March 4, 2022, Governor Gavin Newsom issued Executive Order N-6-22 (EO) regarding sanctions in response to Russian aggression in Ukraine. The EO is located at https://www.gov.ca.gov/wp-content/uploads/2022/03/3.4.22-Russia-Ukraine-Executive-Order.pdf.

The EO directs all agencies and departments that are subject to the Governor’s authority to take certain immediate steps, including notifying all contractors and grantees of their obligations to comply with existing economic sanctions imposed by the U.S. government in response to Russia's actions in Ukraine, as well as any sanctions imposed under state law.

This correspondence serves as a notice under the EO that as a contractor or grantee, compliance with the economic sanctions imposed in response to Russia’s actions in Ukraine is required, including with respect to, but not limited to, the federal executive orders identified in the EO and the sanctions identified on the U.S. Department of the Treasury website (https://home.treasury.gov/policy-issues/financial-sanctions/sanctions-programs-and-countryinformation/ukraine-russia-related-sanctions). Failure to comply may result in the termination of contracts or grants, as applicable.

Please note that for any agreements or grants valued at $5 million or more, a separate notification will be sent outlining additional requirements specified under the EO.

Annly Roman
California State Library
900 N Street
Sacramento, CA 95814
DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 32 12/6/2022

CALIFORNIA STATE LIBRARY FINANCIAL CLAIM
California Library Services Act PAYMENT IN FULL

CERTIFICATION
I hereby certify under penalty of perjury: that I am the duly authorized representative of the claimant herein; that this claim is in all respects true, correct and in accordance with law and the terms of the agreement; and that payment has not previously been received for the amount claimed herein.

By
(Signature of the Authorized Representative)
(Print Name) (Title)
*Legal payee name must match the payee’s federal tax return. Warrant will be made payable to payee name. Payee discrepancies in name and/or address may cause delay in payment. If you need to change payee name and/or address, please contact Fiscal Services at [email protected].

If you are not using DocuSign electronic signature to submit your claim, please complete the following:

EMAIL A SCANNED COPY:
[email protected]
MAIL ONE ORIGINAL SIGNATURE TO:

California State Library
Fiscal Office –State Grants
PO Box 942837
Sacramento, CA 94237-0001
State of California, State Library Fiscal Office
ENY: 2022 ITEM NO: 6120-211-0001, Chapter 43, Statutes of 2022 PURCHASING AUTHORITY NUMBER: CSL-6120 REPORTING STRUCTURE: 61202000 COA: 5432000 PROGRAM #: 5312
By Date
(State Library Representative)
Grant Award #: ZIP22-68 Date:

Invoice #: ZIP22-68-01 PO #:

Payee Name: Santa Ana Public Library
(Legal name of authorized agency to receive, disburse and account for funds*) Complete Address:

Street Address, City, State, Zip Code (Warrant will be mailed to this address) Amount Claimed: $9,928.00 Type of Payment:

Payable Upon Execution of Agreement ☐ PROGRESS
Grantee Name: Santa Ana Public Library ☐ FINAL
(Name on Award Letter and Agreement) ☒ IN FULL
Project Title: Zip Books Project ☐ AUGMENT
For Period From: upon execution to end of grant period
DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 Brian Sternberg
In Process
City Council 11 – 33 12/6/2022
STATE OF CALIFORNIA – DEPARTMENT OF FINANCE

PAYEE DATA RECORD
(Required when receiving payment from the State of California in lieu of IRS W-9 or W-7) STD 204 (Rev. 03/2021)
Section 1 – Payee Information
NAME (This is required. Do not leave this line blank. Must match the payee’s federal tax return) BUSINESS NAME, DBA NAME or DISREGARDED SINGLE MEMBER LLC NAME (If different from above) MAILING ADDRESS (number, street, apt. or suite no.) (See instructions on Page 2)

CITY, STATE, ZIP CODE E-MAIL ADDRESS
Section 2 – Entity Type
Check one (1) box only that matches the entity type of the Payee listed in Section 1 above. (See instructions on page 2) ☐ SOLE PROPRIETOR / INDIVIDUAL CORPORATION (see instructions on page 2) ☐ ☐ MEDICAL (e.g., dentistry, chiropractic, etc.) SINGLE MEMBER LLC Disregarded Entity owned by an individual ☐ PARTNERSHIP
☐ ESTATE OR TRUST
☐ LEGAL (e.g., attorney services)
☐ EXEMPT (e.g., nonprofit)
☐ ALL OTHERS
Section 3 – Tax Identification Number
Enter your Tax Identification Number (TIN) in the appropriate box. The TIN must match the name given in Section 1 of this form. Do not provide more than one (1) TIN.

The TIN is a 9-digit number. Note: Payment will not be processed without a TIN. •
•
•
•
•
•
For Individuals, enter SSN.

If you are a Resident Alien, and you do not have and are not eligible to get an SSN, enter your ITIN.

Grantor Trusts (such as a Revocable Living Trust while the grantors are alive) may not have a separate FEIN. Those trusts must enter the individual grantor’s SSN.

For Sole Proprietor or Single Member LLC (disregarded entity), in which the sole member is an individual, enter SSN (ITIN if applicable) or FEIN (FTB prefers SSN).

For Single Member LLC (disregarded entity), in which the sole member is a business entity, enter the owner entity’s FEIN. Do not use the disregarded entity’s FEIN.

For all other entities including LLC that is taxed as a corporation or partnership, estates/trusts (with FEINs), enter the entity’s FEIN.

Social Security Number (SSN) or
Individual Tax Identification Number (ITIN)
___ ___ ___ -___ ___ - ___ ___ ___ ___
OR
Federal Employer Identification Number
(FEIN)
___ ___ - ___ ___ ___ ___ ___ ___ ___
Section 4 – Payee Residency Status (See instructions)

☐ CALIFORNIA RESIDENT – Qualified to do business in California or maintains a permanent place of business in California. ☐ CALIFORNIA NONRESIDENT – Payments to nonresidents for services may be subject to state income tax withholding. ☐No services performed in California
☐Copy of Franchise Tax Board waiver of state withholding is attached.

Section 5 – Certification
I hereby certify under penalty of perjury that the information provided on this document is true and correct.

Should my residency status change, I will promptly notify the state agency below.

NAME OF AUTHORIZED PAYEE REPRESENTATIVE TITLE E-MAIL ADDRESS SIGNATURE DATE TELEPHONE (include area code)
Section 6 – Paying State Agency
Please return completed form to:

STATE AGENCY/DEPARTMENT OFFICE UNIT/SECTION
MAILING ADDRESS FAX TELEPHONE (include area code)

CITY STATE ZIP CODE E-MAIL ADDRESS
Print Form Reset Form
DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 Ca. State Library
Sacramento
900 N Street 916-603-7157
Admin/Accoutning
CA 95814 [email protected]
In Process
City Council 11 – 34 12/6/2022

STATE OF CALIFORNIA – DEPARTMENT OF FINANCE

PAYEE DATA RECORD
(Required when receiving payment from the State of California in lieu of IRS W-9 or W-7) STD 204 (Rev. 03/2021)

GENERAL INSTRUCTIONS
Type or print the information on the Payee Data Record, STD 204 form. Sign, date, and return to the state agency/department office address shown in Section 6.

Prompt return of this fully completed form will prevent delays when processing payments.

Information provided in this form will be used by California state agencies/departments to prepare Information Returns (Form1099).

NOTE: Completion of this form is optional for Government entities, i.e. federal, state, local, and special districts.

A completed Payee Data Record, STD 204 form, is required for all payees (non-governmental entities or individuals) entering into a transaction that may lead to a payment from the state. Each state agency requires a completed, signed, and dated STD 204 on file; therefore, it is possible for you to receive this form from multiple state agencies with which you do business.

Payees who do not wish to complete the STD 204 may elect not to do business with the state. If the payee does not complete the STD 204 and the required payee data is not otherwise provided, payment may be reduced for federal and state backup withholding. Amounts reported on Information Returns (Form 1099) are in accordance with the Internal Revenue Code (IRC) and the California Revenue and Taxation Code (R&TC).

Section 1 – Payee Information
Name – Enter the name that appears on the payee's federal tax return. The name provided shall be the tax liable party and is subject to IRS TIN matching (when applicable).
• Sole Proprietor/Individual/Revocable Trusts – enter the name shown on your federal tax return. • Single Member Limited Liability Companies (LLCs) that is disregarded as an entity separate from its owner for federal tax purposes - enter the name of the individual or business entity that is tax liable for the business in section 1. Enter the DBA, LLC name, trade, or fictitious name under Business Name. • Note: for the State of California tax purposes, a Single Member LLC is not disregarded from its owner, even if they may be disregarded at the Federal level. • Partnerships, Estates/Trusts, or Corporations – enter the entity name as shown on the entity’s federal tax return. The name provided in Section 1 must match to the TIN provided in section 3. Enter any DBA, trade, or fictitious business names under Business Name.

Business Name – Enter the business name, DBA name, trade or fictitious name, or disregarded LLC name.

Mailing Address – The mailing address is the address where the payee will receive information returns. Use form STD 205, Payee Data Record Supplement to provide a remittance address if different from the mailing address for information returns, or make subsequent changes to the remittance address.

Section 2 – Entity Type
If the Payee in Section 1 is a(n)… THEN Select the Box for… Individual ● Sole Proprietorship ● Grantor (Revocable Living) Trust disregarded for federal tax purposes Sole Proprietor/Individual Limited Liability Company (LLC) owned by an individual and is disregarded for federal tax purposes Single Member LLC-owned by an individual Partnerships ● Limited Liability Partnerships (LLP) ● and, LLC treated as a Partnership Partnerships Estate ● Trust (other than disregarded Grantor Trust) Estate or Trust Corporation that is medical in nature (e.g., medical and healthcare services, physician care, nursery care, dentistry, etc. ● LLC that is to be taxed like a Corporation and is medical in nature Corporation-Medical
Corporation that is legal in nature (e.g., services of attorneys, arbitrators, notary publics involving legal or law related matters, etc.) ● LLC that is to be taxed like a Corporation and is legal in nature Corporation-Legal
Corporation that qualifies for an Exempt status, including 501(c) 3 and domestic non-profit corporations. Corporation-Exempt Corporation that does not meet the qualifications of any of the other corporation types listed above ● LLC that is to be taxed as a Corporation and does not meet any of the other corporation types listed above Corporation-All Other
Section 3 – Tax Identification Number
The State of California requires that all parties entering into business transactions that may lead to payment(s) from the state provide their Taxpayer Identification Number (TIN). The TIN is required by R&TC sections 18646 and 18661 to facilitate tax compliance enforcement activities and preparation of Form 1099 and other information returns as required by the IRC section 6109(a) and R&TC section 18662 and its regulations.

Section 4 – Payee Residency Status
Are you a California resident or nonresident?
• A corporation will be defined as a "resident" if it has a permanent place of business in California or is qualified through the Secretary of State to do business in California.
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DocuSign Envelope ID: 39D3416E-E2CB-4407-9A82-A0F316B701C9 In Process
City Council 11 – 35 12/6/2022
Library
www.santa-ana.org/departments/library/
Item # 12
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
December 6, 2022
TOPIC: Delhi Center Lease - New Library Branch
AGENDA TITLE:

Agreement with the Delhi Center to Lease Space for a New Library Branch (General Fund)

RECOMMENDED ACTION
Authorize the City Manager to execute a lease agreement with the Delhi Center for 2,465 square feet of leased space and adjacent exterior space for a new Library Branch, for a ten-year term beginning March 1, 2023, with an option for two five-year renewals, monthly rent rate of $3,550.00 with an annual 3% increase, subject to non-substantive changes approved by the City Manager and City Attorney.

DISCUSSION
The Santa Ana Public Library currently has two locations that provide services to residents, the Main Library and Newhope Library. Both locations are slated to be renovated, with design services under way. Design for the Main Library is anticipated to be complete in early 2024, with construction to begin in summer 2024.

To ensure continuity of services during the Main Library closure, the Library Services Agency has negotiated a lease agreement with the Delhi Center for the construction of a new public library branch within their existing building. Currently, residents in the Delhi neighborhood and surrounding communities have minimal access to library services, as there are no physical library locations in the southern part of the City. Therefore, in an effort to enhance equity and quality of life in an underserved area, approximately 2,500 square feet of space at the Delhi Center will be re-imagined as a new, innovative public library experience. A new outdoor activity patio will also be constructed to support library services and programs.

Residents will have access to technology, tools and services that will improve adult literacy, support positive educational outcomes for youth, and prepare our community’s present and future workforce for a technology-driven world. Throughout the newlycreated library space and outdoor activity patio, children, teens, and families will be City Council 12 – 1 12/6/2022
Delhi Center Lease - New Library Branch
December 6, 2022

provided opportunities to learn and connect with their community in positive ways.

Services may include STEM and robotics programs geared to neuro-divergent youth, special events and author hours for adults, homework help and tutoring for students, and a wide variety of cutting-edge technology and computers for use in the library or at home. These new educational spaces and the accompanying programs and services will bring a much needed community amenity to an area of the City that lacks library services.

A summary of the lease terms is as follows:
• Term: 10 years commencing March 1, 2023
• Renewals: Two 5-year options to renew
• Square Footage: 2,465 sq ft plus adjacent exterior patio space • Monthly Rent: $3,550/month with a 3 percent annual escalator. Rate also includes common area maintenance costs.
• Utilities: City’s pro rata share of utility costs is 11.36% to be paid monthly • Early Termination: Early termination provision upon 90-day written notice • Improvements: City to improve the space at its expense for use as a modern library
Funding for library branch improvements was included in the Revive Santa Ana Spending Plan - Critical Infrastructure category as approved by City Council on August 2, 2022. The Library was allocated $6 Million for New Library Branch/Expansion of Library Accessibility projects. The appropriations will fund both the Jerome Park Outdoor Public Library and Delhi Center Library Branch improvements.

It is important to note that the City currently has a Ground Lease Agreement with the Delhi Center, which allowed for the construction and subsequent operation of the Delhi Center during the duration of the lease. The Ground Lease is in effect through September 2040, subject to an option to extend through 2050.

ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.

FISCAL IMPACT
Funds are available for expenditure in the current Fiscal Year 2022-23 (March-June) as follows:

Fiscal Year Accounting Unit
– Account
Number
Fund
Description
Accounting Unit
– Account Number
Description
Amount
2022-23 01111110-62500 General
Fund
Library Administration
– Rent Payments
$14,200.00
2022-23 01111110-62000 General
Fund
Library Administration
– Utilities
$2,400.00
City Council 12 – 2 12/6/2022
Delhi Center Lease - New Library Branch
December 6, 2022

TOTAL $16,600.00
Future fiscal year rental and utility costs will be requested in the Library Services Agency’s annual budget.

EXHIBIT(S)

1. Lease Agreement
Submitted By: Brian Sternberg, Executive Director of Library Services Approved By: Kristine Ridge, City Manager
City Council 12 – 3 12/6/2022

LEASE AGREEMENT BETWEEN THE CITY OF SANTA ANA AND THE

DELHI CENTER
THIS LEASE AGREEMENT (the "Lease") is made and entered into by The Delhi Center, a California nonprofit benefit corporation ("Lessor" or “Delhi”), and the City of Santa Ana, a charter city and municipal corporation organized and existing under the Constitution and laws of the State of California ("Tenant" or “City”) (collectively referred to as the “Parties”), under the following terms and conditions:

RECITALS
A. The Parties entered into a Ground Lease Agreement (“Ground Lease”) dated September 5, 2000, as amended, by which the City leased real property to the Delhi Center for construction of a Community Center to be operated by Delhi for the duration of the Ground Lease. This facility is known as The Delhi Center.

B. The Ground Lease remains in effect through September 5, 2040, subject to further extension through 2050.

C. The Parties intend to enter an agreement wherein the Lessor would agree to lease approximately 2,465 square feet of space at the Delhi Center to the City of Santa Ana for purposes of providing public library services.

1. Description of the Leased Premises. Delhi hereby leases to City the premises at the Delhi Center encompassing rooms 101, 102, and 103 for a total of approximately 2,465 square feet, plus the immediately adjacent exterior space for an outdoor patio, all as referred to herein as the "Premises" and shown on Exhibit A (the "Property").

2. Term, Occupancy, Termination.
(a) Term. The term of this Lease shall be ten (10) years, commencing with the City taking possession on March 1, 2023 (the "Commencement Date") with the option for up to two (2) five-year renewals, exercisable by mutual agreement of the Parties and in writing by the City Manager and the City Attorney, unless earlier terminated as provided herein. (b) Occupancy. City may, upon execution of this Lease by Delhi and City, occupy the Premises on the Commencement Date subject to all terms and conditions of this Lease.

Upon delivery of first month's rent, Delhi shall deliver the keys and possession of the Premises to City.
(c) Termination. This Lease may be terminated by the City upon ninety (90) days written notice of termination. At the termination of this Lease, City shall surrender the Premises to Delhi in the condition required by this Lease.

3. Rent. The initial rent for the first twelve (12) months of this Lease including a prorata share of common area maintenance (“CAM”), as described below in Section 6, shall be a City Council 12 – 4 12/6/2022

monthly rent of Three Thousand, Five Hundred Fifty Dollars and Zero Cents ($3,550.00). City shall, commencing on the Commencement Date and continuing thereafter on the first (1st) day of each and every month during the term of this Lease, pay to Delhi in advance, such minimum monthly rent, without setoff, deduction or demand. Every year after the initial year, on the anniversary of the Commencement Date, the rent payable by City shall be increased by 3% each year.

Year Base Rent
I March 1, 2023 – February 29, 2024 $3,550
2 March 1, 2024 – February 28, 2025 $3,657
3 March 1, 2025 – February 28, 2026 $3,766
4 March 1, 2026 – February 28, 2027 $3,879
5 March 1, 2027 – February 29, 2028 $3,996
6 March 1, 2028 – February 28, 2029 $4,116
7 March 1, 2029 – February 28, 2030 $4,239
8 March 1, 2030 – February 28, 2031 $4,366
9 March 1, 2031 – February 29, 2032 $4,497
10 March 1, 2032 – February 28, 2033 $4,632

4. Place of Payment of Rent. Rent and all other sums which shall become due under this Lease, including but not limited to late charges and additional rent, shall be payable by hand delivery or mail at the office of the Delhi located at 505 E Central Ave, Santa Ana, CA 92707, or at such other place as Delhi may designate from time to time in writing. Parties may agree to change to electronic payment, subject to City’s accounting procedures.

5. Condition of, and Improvements to, Premises.
(a) Improvements.
(i) Delhi shall have the obligation to clear out rooms of furniture and non-fixed items that are located within the Premises to another location prior to the Commencement Date of this Lease.
(ii) Under this Lease, City, at City’s expense, shall have the right to improve the Premises and/or the exterior of the building housing the subject Premises (the “Building”)such that it is appropriate for use as a modern public library space. Any improvements shall be made only in accordance with applicable federal, state, or local codes, ordinances, or regulations, having due regard to the type of construction of the Building. Such improvements, if removable, shall remain the property of City at the termination of this Lease. City is not required to return the Premises to a pre-Lease state upon termination of the Lease. In consideration of this provision, City shall pay to Delhi a one-time, non-refundable sum equal to the monthly rent at the time of the termination. City shall share plans of design and improvements with Delhi for coordination purposes so as not to hinder Delhi’s operations, however, Delhi’s permission shall City Council 12 – 5 12/6/2022

not be required for such improvements. A non-exhaustive list of possible City improvements is attached as Exhibit B. The City shall inform Delhi of any additional improvements that materially change the original concept.
(b) Condition Upon Surrender. Upon termination of this Lease, City shall surrender the Premises as improved to Delhi in good condition and repair, ordinary wear and tear and damage by fire, storm, lightning, earthquake, act of God or other casualty excepted.

6. Use. The Premises shall be used in a manner consistent with that of a modern public library, exclusively. The library will not be open Saturdays after 2:00 p.m., Sundays, and holidays. City shall not use any portion of the Premises for purposes other than those specified without first obtaining the written consent of Delhi, which consent shall not be unreasonably withheld. City shall not do, bring, or keep anything in, on, or about the Premises which will in any way increase the premium rate or cause the cancellation of any fire or other insurance upon the Premises, the building in which the Premises are located, or any of its contents. City shall have the non-exclusive right to use the parking area and driveways, sidewalks, hallways, restrooms (to the extent not entirely contained in the Premises), common area pathways to and from the parking area and Premises in common with the other tenants or users of the Building as well as the main lobby and central hallway. City agrees to a proportional share of the common area maintenance amounting to 398 square feet, such CAM fees are included in the Rent described in Section 3, above.

7. Compliance with Laws/Hazardous Materials. City, at City's expense, shall comply with and cause all of City's agents to comply with all applicable laws, ordinances, rules and regulations of governmental authorities applicable to the Premises or the use or occupancy thereof, including, without limitation, the law commonly known as the Americans With Disabilities Act and California Code of Regulations Title 8, Sections 3281 through 3299 (collectively, "Laws").

Further, City, at City's expense, shall ensure that any activities conducted in, on, from, or about the Premises shall comply with all applicable laws, ordinances, rules and regulations of governmental authorities.

8. Waste; Nuisance; Quiet Enjoyment; Rules and Regulations. City shall not suffer or commit any waste or nuisance on the Premises, nor shall City interfere with or obstruct the rights of or disturb the quiet enjoyment of any other tenant or occupant of the Building or injure or annoy them. City will comply, and cause its employees, patrons, and agents to comply, with all rules and regulations adopted by Delhi in connection with the use of the Premises, the parking areas, and common areas, which rules and regulations may be adopted or amended by Delhi at any time so long as such rules and regulations are provided to City in writing and within a reasonable time after promulgation by Delhi. City shall provide security services within its leased premises.

9. Repair and Maintenance.
(a) Except as noted under Section 9(b), below, Delhi shall repair and maintain the roof, structural foundations, and exterior walls of the Building as well as all interior portions of the Building that are not within the Premises.

City Council 12 – 6 12/6/2022

(b) City shall, at City's sole cost and expense, maintain the Premises, including the indoor and outdoor routine maintenance and repairs of the Premises and surrounding area, in good condition and repair. Said maintenance shall include, the interior of the Premises, exterior doors and windows, all fixtures and equipment, including without limitation, plate glass, lighting fixtures, and plumbing fixtures. Delhi shall maintain the heating and air conditioning system in good working order at Delhi's sole expense and cost.

10. Janitorial. All cleaning and janitorial services for the Premises shall be provided, at City’s sole cost and expense, exclusively by or through City or City’s janitorial contractors in accordance with the provisions of this Lease. City shall notify Delhi of the company, person or persons providing this service. Janitor service shall include ordinary cleaning and occur regularly. Scheduling and access will be coordinated by both parties.

11. Utilities. City shall pay City’s portion of utilities, including gas service, trash, electrical service, water, real estate taxes and all connection charges furnished to or used by City upon the Premises. The Parties agree that City’s share shall be 11.36% of the utilities. Delhi will invoice City once a month with a copy of the utility bills, and City will submit payment to Delhi within 60 days of receipt, subject to City accounting procedures. City shall provide itself or contract directly with the following utilities/service providers and pay for such services directly:
janitorial, security, cable service, telephone services, broadband internet services, and all connection charges. City shall deposit all trash only in designated areas.

12. Rules. City shall before and during the Term faithfully observe and comply with, and shall cause all occupants of the Premises to observe and comply with, the rules and regulations, if any, attached to this Lease as Exhibit C and all reasonable modifications thereof and additions thereto from time to time put into effect by Delhi (the "Rules and Regulations").

13. Entry by Delhi. Except for emergencies such as fire, water intrusion and the like, which may be at any time, Delhi and its agents shall have the right to enter the Premises during normal hours of operation to inspect and examine the same and to make mutually agreed upon repairs to the Premises.

14. Hold Harmless. Delhi shall assume no liability for any use of the Premises by the City.

Except from Delhi’s negligence, City shall waive, release and hold harmless Delhi, its employees, and agents from all claims against Delhi, including but not limited to claims for death, injuries, exposure to COVID-19, or other illness, or damage to property sustained by City, its agents, employees, contractors, and invitees in, upon, or about said Premises, or for any action or liability of injury arising out of the use of the Premises by City, due to any act or omission by the City, its employees, agents, invitees, and contractors, including failure of Tenant to keep the Premises in good condition and repair as provided in this Lease. City shall adhere to all CDC guidelines to help minimize the spread of COVID-19 or other illness.

15. Insurance. Throughout the Term or any renewal period, City shall maintain insurance as described below:
(a) Combined Single Limit Bodily Injury and Property Damage Insurance.

Policy naming Delhi as an additional insured with the City against any liability arising out of the improvements, use, occupancy, or maintenance of the Premises in the conduct of the City’s City Council 12 – 7 12/6/2022

programs. Such insurance shall be a Combined Single Limit policy in the amount not less than Two Million Dollars ($2,000,000). The limits of such insurance shall not, however, limit the liability of the City.
(b) Workers’ Compensation Insurance. For all employees working on the Premises and shall furnish Delhi with a Certificate of Insurance indicating the extent of coverage.

16. Destruction of Premises.
(a) Destruction Due to Risk Covered by Insurance. If, during the term of this Lease, including any renewal term, the Premises or the Building and other improvements in which the Premises are located are totally or partially destroyed from a risk covered by insurance carried by either City or Delhi for the Building, rendering the Premises totally or partially inaccessible or unusable, the responsible party shall work with their respective insurance carrier(s) to restore the Premises or the Building, and other improvements in which the Premises are located, to substantially the same condition as they were immediately before destruction, if they can be repaired within 120 days from date of destruction, such destruction shall not terminate this Lease.

In the event that damage was caused due to the actions of both parties, the shared damage would be repaired or replaced through a cooperative action by both parties and their respective insurance carriers. However, if such destruction cannot be repaired within 120 days from date of destruction, City shall have the right to terminate this Lease upon 30 days written notice. If the existing laws do not permit the restoration, either party can terminate this Lease immediately by giving notice to the other party.
(b) Abatement or Reduction of Rent. In case of destruction where Delhi is at fault, there shall be an abatement or reduction of rent between the date of destruction and the date of substantial completion of restoration based on the extent to which the destruction interferes with City's use of the Premises. In the event that a governmental authority with jurisdiction over the Premises recognizes a pandemic and issues an order requiring businesses to be closed, rent shall not be abated.

17. Default.
(a) Default by City. The occurrence of any of the following shall constitute a default by City:
(i) City shall fail to pay when due any rent or any other monetary sum payable under this Lease.
(ii) City shall fail to observe, keep or perform any of the other terms, covenants, agreements or conditions contained in this Lease and such default continues for a period of thirty (30) days after written notice by Delhi specifying the nature of the default with reasonable particularity, unless the nature of the default is such that more than thirty (30) days is required to cure it and City commences to cure it within such thirty (30)-day period and thereafter diligently pursues it to completion.
(iii) City shall become bankrupt or insolvent or make a transfer in fraud of creditors, or make an assignment for the benefit of creditors, or take or have taken against City City Council 12 – 8 12/6/2022

any proceedings of any kind under any provision of the Federal Bankruptcy Act or under any other insolvency, bankruptcy or reorganization act and, in the event any such proceedings are involuntary, City is not discharged from the same within thirty (30) days thereafter. (iv) A receiver is appointed for a substantial part of the assets of City, and such receivership is not released within thirty (30) days. (v) The abandonment of the Premises by City, or the vacation (hereby defined to be thirty (30) or more consecutive days of continual absence from the Premises) of the Premises by City.

Notices given under this section shall be in writing and specify the alleged default and the applicable Lease provisions, and shall demand that City perform the provisions of this Lease or pay the rent that is in arrears, as the case may be, within the applicable period of time, or quit the Premises.
(b) Delhi's Remedies. If any default by City shall occur, and following notice of default as required by this Lease (for the period applicable to the default under the applicable provision of this Lease), Delhi shall have the following remedies in addition to all other rights and remedies provided by law or equity, to which Delhi may resort cumulatively or in the alternative. (i) Delhi shall have the immediate option to terminate this Lease and all rights of City hereunder by giving written notice of such intention to terminate. (ii) No reentry or taking possession of the Premises by Delhi pursuant to this section shall be construed as an election to terminate this Lease. (c) Default by Delhi. The occurrence of any of the following shall constitute a default by Delhi:
(i) Delhi shall fail to observe, keep or perform any of the other terms, covenants, agreements or conditions contained in this Lease and such default continues for a period of thirty (30) days after written notice by City specifying the nature of the default with reasonable particularity, unless the nature of the default is such that more than thirty (30) days is required to cure it and Delhi commences to cure it within such thirty (30)-day period and thereafter diligently pursues it to completion.
(ii) Delhi shall become bankrupt or insolvent or make a transfer in fraud of creditors, or make an assignment for the benefit of creditors, or take or have taken against Delhi any proceedings of any kind under any provision of the Federal Bankruptcy Act or under any other insolvency, bankruptcy or reorganization act and, in the event any such proceedings are involuntary, Delhi is not discharged from the same within thirty (30) days thereafter. (iii) A receiver is appointed for a substantial part of the assets of Delhi, and such receivership is not released within thirty (30) days.

Notices given under this section shall be in writing and specify the alleged default and the applicable Lease provisions.

City Council 12 – 9 12/6/2022

(d) City's Remedies. If any default by Delhi shall occur, and following notice of default as required by this Lease (for the period applicable to the default under the applicable provision of this Lease), City, in addition to all other rights and remedies provided by law or equity, to which City may resort cumulatively or in the alternative, shall have the immediate option to terminate this Lease and all rights of Delhi hereunder by giving written notice of such intention to terminate.

18. Assignment and Subletting. City shall not either voluntarily or by operation of law, assign, transfer, mortgage, pledge, hypothecate or encumber this Lease or any interest therein, and shall not sublet the said Premises or any part thereof, or any right or privilege appurtenant thereto, or allow any other person (the employees, agents, servants, and invitees of City excepted) to occupy or use the said Premises, or any portion thereof, without first obtaining the written consent of Delhi which shall not be unreasonably withheld.

19. Signs. Delhi agrees that City may provide signs on the Building, and throughout the Premises, provided, at termination of its occupancy, City shall remove such signage.

20. Parking. City shall have the nonexclusive use of the parking area controlled by Delhi at and around the Premises; provided; however, that no invitee may park in an area designated, identified, and/or reserved for parking by any other tenant or tenants, if any. It is expressly understood and agreed that City’s right to the use of said parking area shall be nonexclusive and subject to the Rules and Regulations, and that Delhi reserves the right to establish and enforce other rules with respect to the use thereof, and City agrees to abide by and conform to the same, as revised from time-to-time.

21. Attorneys' Fees. If either party commences an action against the other party arising out of or in connection with this Lease, the prevailing party shall be entitled to have and recover from the losing party reasonable attorney's fees and costs of suit.

22. Notices. Any notice required or permitted to be given hereunder may be given by personal delivery or by United States certified mail, postage prepaid, addressed to City at the Premises and to Delhi at 505 E Central Ave, Santa Ana, CA 92707, or at such other address as the Delhi shall designate in writing.

23. Waiver. Each and every waiver of any covenant, representation, warranty or any other provision hereof must be in writing and signed by each party whose interests are adversely affected by such waiver. No waiver granted in any one instance shall be construed as a continuing waiver applicable in any other instance.

24. Time is of the Essence. Time is of the essence of this Lease as to the performance of all terms, covenants, and conditions stated herein.

25. Successors and Assigns. Except as otherwise provided herein, all of the terms and conditions hereof shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

26. Titles and Definitions. The titles of paragraphs herein are for identification only.

They shall not be considered to be a part of this Lease and shall have no effect upon the City Council 12 – 10 12/6/2022
City Council 12 – 11 12/6/2022
City Council 12 – 12 12/6/2022

EXHIBIT A
City Council 12 – 13 12/6/2022
60 Sq. Ft.

Water Heater
Closet
Class #3
805 Sq. Ft.

Class #2
756 Sq. Ft.
6 Full Ballroom: 4460 Sq. Ft. 5
Front Ballroom: 2370 Sq. Ft.

Back Ballroom: 2070 Sq. Ft.

Accordion Divider Class Room
956 Sq. Ft.

Electrical
Room
H.S.

Office
H.S.

Closet
& Roof Access
145 Sq. Ft.

Staff
Restroom
Kids
7 Ballroom
Ballroom Height ‐ 17ft
3 Middle Section Height ‐ 15ft
103
1038 Sq. Ft.
2 1
Class
Restroom
Hallway leading to
Head Start Playground
Class #1
1582 Sq. Ft.

Courtyard
Computer
540 Sq. Ft.
8 Restroom Restroom
Room
574 Sq. Ft.

Class Room
101
325 Sq. Ft.

Class
Room
101
435 Sq. Ft.
1804 Sq. Ft. Office Office Lunch
Room
H.S.

Main Office
Office
298 Sq. Ft.
9 Conference
Room
315 Sq. Ft.
2,149 Sq. Ft.

Lobby/Reception
Front
Desk
123 Sq. Ft.

Office
Room 101– Total
760Sq. Ft.

Storage Square
Feet
10 Dance
Room
1620 Sq. Ft.

Exercise
Room
1323 Sq. Ft.
11 1491 Sq. Ft.

Staff
Area
12 13
Office
122 Sq. Ft.
122 Sq. Ft.

Office
Office
129 Sq. Ft.

1. 2.

3. 4.

5. 6.

7. 8.

9. 10.

11. 12.

13. 50 sf
48 sf
225 sf
42 sf
263 sf
101 sf
37 sf
13 sf
27 sf
245 sf
58 sf
126 sf
52 sf
Total 1287 sf

EXHIBIT A
Delhi Center Plot Plan
STAGE
Trash
Area
4 Green Container
Delhi Playground
H.S.

Closet
Restroom Supplies Restroom
71 Sq. Ft.

Kitchen
H.S. Closet
Library Patio
Area
City Council 12 – 14 12/6/2022

EXHIBIT B
City Council 12 – 15 12/6/2022

EXHIBIT B
Delhi Community Center Library Possible Improvements:
 Interior Library space – glass storefront-style entrance with marque signage overhead o Include interior and exterior displays (digital and display cases)  Reconfigure interior floorplan so conducive to public library space  Book Collection
o Utilize mobile double-face shelving units for collection (72’Wx24”Dx52”H) o Collection
 20% YA
 50% Youth
 30% Adult
 Laptop Kiosks for public computer desktops
o No public desktop computers
 Signage Plan Needed
o Marque Library Exterior and Interior signage
o Monument Sign @ entrance to parking lot (not internally lighted)  Book drop in parking lot as part of traffic flow
 Public Printer/Copier/Scanner area – only one multi-use machine with computer screen  Furniture Plan Needed
o Indoor furniture (flexible)
o Outdoor reading/laptop use seating areas (secured)
o Circ/Reference Mobile Desk (6-ft desk)
o Inside Reader Tables
 Staff
o 1 Office
o Circ/Reference Desk Service Point
 Lighting Plan Needed (Interior and Exterior Patio)
 Electrical Plan Needed (Interior and Exterior Patio)
 Potential new exterior patio access through Library space  Small decorative patio fence
 Shade Structure for Patio
 Exterior Patio playground equipment – interactive, learn through playing  Outdoor area combination of soft-scape and hard-scape; drought tolerant landscaping  Children’s programming seating (30 people)
 Mobile book shelving/carts to the outdoor patio
Infrastructure:
 Internal/Exterior Patio Wifi Access Points - for Delhi and Library patrons  Network connectivity via IT (City private network)
City Council 12 – 16 12/6/2022

EXHIBIT C
City Council 12 – 17 12/6/2022

EXHIBIT C

DELHI CENTER RULES AND REGULATIONS
11/10/2022

RULES AND REGULATIONS
The following Rules and Regulations shall be in effect at the Premises. Delhi reserves the right to adopt reasonable modifications and additions hereto. In the case of any conflict between these Rules and Regulations and the Lease, the Lease shall be controlling.

1. The City employees, agents, guests, and invitees shall comply with all applicable laws and government rules and regulations.

2. No live animals are to be brought onto the Center without the prior written authorization of Delhi, except for service animals.

3. The Center is a non-smoking facility. No smoking, including vaping, is permitted inside the facility or in its courtyard at any time. Designated smoking areas are located outside at least 100 feet away from the front door of the Center.

4. Illegal drugs are not permitted in or on the Center’s property, including parking areas.

5. Upon substantial completion of the improvements, tentatively January 2024, the Library shall not be open to the public Saturdays after 2:00 pm, Sundays and legal holidays. Special events and functions will be coordinated by Parties.

6. Parties shall meet regularly to coordinate improvements, transitions, programming, and events.

Meetings will occur more frequently during improvements and six months after commencement of public operations. Frequency, dates, and times are to be agreed upon at the initial meeting after the execution of the lease and shall not exceed one regularly scheduled meeting per month, or as necessary.

7. City will receive one annual rental of the Delhi ballroom space free of charge during regular Delhi hours, and based on availability with thirty (30) days written notice.

8. City will have access to the Premises (as identified in Exhibit A) and common areas. Minors in fifth (5th) grade or below must be accompanied by a parent, guardian, or family member in ninth (9th) grade or above.

9. City shall not allow the number of employees, agents, guests, and invitees to exceed the maximum number allowed for such Area as set forth by the number permitted under government regulations.

10. Parking is only allowed in designated areas. The Center driveway is to be used for loading and unloading only.

11. The lobby, hallways and courtyard shall not be obstructed by the City or used by it for any purpose other than for ingress to and egress from their respective Premises. City will request in writing approval to place objects in common areas.

12. The City will abide by all rules set forth by waste collection provider, Republic Services when disposing of waste. City will be responsible for reimbursing Delhi for penalty charges assessed by waste collection provider for overflowing trash bins, or other violation when caused by City.

City Council 12 – 18 12/6/2022

EXHIBIT C

DELHI CENTER RULES AND REGULATIONS
11/10/2022

13. City, shall deliver to Delhi a set of keys for the Premises to be used for emergency purposes.

Delhi shall deliver to the City a key for the Premise and restrooms. Upon the termination of its tenancy, parties shall return keys that have been furnished.

14. City shall see that the windows and doors of the Premises are closed and securely locked before leaving the Premises and City shall exercise care that all utilities are shut off before City or City employees leave the Premise, and that all other items are shut off, so as to prevent waste or damage.

15. City shall not erect any aerial or antenna on the roof or exterior walls of the Premises, the Building, or the Premises, without prior consent.

16. Delhi reserves the right to make such other and further rules and regulations as in its reasonable judgment may be for the safety, care and cleanliness of the Premises and for the preservation of good order therein. Such additional Rules and Regulations shall be noticed 45 days in advance of implementation and mutually agreed upon by both parties. City agrees to abide by these Rules and Regulations herein above stated and any additional rules and regulations which are adopted hereafter.

City Council 12 – 19 12/6/2022
Parks, Recreation, and Community Services
www.santa-ana.org/parks
Item # 13
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
December 6, 2022
TOPIC: Agreement Amendment with Community SeniorServ, Inc. dba Meals On Wheels Orange County for the Senior Meals Program
AGENDA TITLE:

Agreement Amendment with Community SeniorServ, Inc. dba Meals On Wheels Orange County for Senior Meal Programs to Increase the Total Agreement Amount by $50,000 for a New Agreement Total Not to Exceed $100,000 and Extend the Agreement Term by Six Months through June 30, 2023 (General Fund)

RECOMMENDED ACTION
Authorize the City Manager to execute an agreement amendment with Community SeniorServ, Inc. dba Meals On Wheels Orange County for Senior Meal Programs to increase the total agreement amount by $50,000, for a new agreement total not to exceed $100,000, and extend the agreement term by six months through June 30, 2023 to be funded by the General Fund, subject to non-substantive changes approved by the City Manager and City Attorney.

DISCUSSION
Community SeniorServ, Inc. dba Meals on Wheels (MOW) Orange County provides the Home Delivered Meals (HDM) and Senior Lunch Cafe programs to the City of Santa Ana. MOW prepares and delivers three meals, five days per week, directly to the homes of HDM program participants. A registered dietician plans the meals to assure 100% of the U.S. Nutritional Recommended Daily Allowance - consisting of a breakfast, a cold lunch, and a frozen dinner. In addition to meals, clients benefit from daily contact with delivery staff as well as the calls and/or visits from caseworkers who regularly check on their well-being.

The Senior Lunch Cafe Program helps alleviate poor nutrition among the elderly population, especially prevalent among those who live alone and/or on a limited income. This nutrition program is normally available at two sites in Santa Ana (Santa Ana Senior Center and Southwest Senior Center) and seeks to enhance the physical and mental well-being of the elderly population by:
• Encouraging a sense of dignity;
• Providing stimulating activities and volunteer opportunities; and • Augmenting participants’ financial resources by providing donation-based meals.

City Council 13 – 1 12/6/2022
Agreement Amendment with Community SeniorServ, Inc. dba Meals On Wheels Orange County for the Senior Meals Program
December 6, 2022

The agreement also provides $9,700 for as-needed meals/services during the term of the contract for special senior programs that may occur.

The Parks, Recreation and Community Services Agency (PRCSA) entered into a sixmonth agreement with MOW for the term of July 1, 2022 to December 31, 2022, with a total agreement amount not to exceed $50,000. PRCSA is now requesting to extend the term of the agreement for an additional six months, for a new termination date of June 30, 2023, and to increase the total agreement amount by an additional $50,000, for a new total agreement amount not to exceed $100,000.

ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.

FISCAL IMPACT
Funds for the additional amount are budgeted and available in the following account for the specified year:

Fiscal
Year
Accounting
Unit-Account #
Fund
Description
Accounting Unit, Account
Description
Amount
FY 22-23 01113230-
62300
General
Fund
PRCSA-Recreation & Comm. Svc,
Contractual Services-Professional
$50,000

EXHIBIT(S)

1. Amendment
Submitted By: Hawk Scott, Executive Dir. of Parks, Recreation and Community Services
Approved By: Kristine Ridge, City Manager
City Council 13 – 2 12/6/2022

FIRST AMENDMENT TO AGREEMENT WITH COMMUNITY SENIORSERV, INC., DBA

MEALS ON WHEELS ORANGE COUNTY FOR A SENIOR MEAL PROGRAM THIS FIRST AMENDMENT to the above-referenced agreement is entered into December 6, 2022, by and between Community SeniorServ, Inc., a California nonprofit corporation dba Meals on Wheels Orange County (“Contractor”), and the City of Santa Ana, a charter city and municipal corporation organized and existing under the Constitution and laws of the State of California (“City”).

RECITALS
A. The parties entered into Agreement No. N-2022-206 (“Agreement”) dated July 1, 2022, to retain Contractor to deliver meals to homebound senior residents and provide meals for senior residents at City senior centers.

B. The Agreement is current and in-effect through January 31, 2023.

C. The parties now wish to amend the Agreement to increase the compensation and extend the term of the Agreement.

The Parties therefore agree:

1. Section 2(a), Compensation, is hereby amended to increase the total sum to be expended under the term of the Agreement, including any extension periods, by $50,000 for a total amount not to exceed $100,000, as further detailed in Exhibit A-1 attached hereto and which shall replace Exhibit A in the Agreement. This sum is comprised of (1) the base amount of $90,300 and (2) a contingency in the amount of $9,700 for additional services at the City’s sole discretion.

2. Section 3, Term, is hereby extended until June 30, 2023, unless terminated earlier in accordance with Section 15 of the Agreement.

3. Except as modified by this First Amendment, all terms and conditions of the Agreement, shall remain in full force and effect.

IN WITNESS WHEREOF, the parties hereto have executed this First Amendment to the Agreement on the date and year first written above.

ATTEST CITY OF SANTA ANA
_______________________________ ______________________________

KRISTINE RIDGE
Clerk of the Council City Manager
[signatures continued on next page]
City Council 13 – 3 12/6/2022

APPROVED AS TO FORM CONTRACTOR
SONIA R. CARVALHO
City Attorney
By: ___________________________ _______________________________ Brandon Salvatierra Holly Hagler
Deputy City Attorney President & CEO

RECOMMENDED FOR APPROVAL
____________________________
Hawk Scott
Executive Director
Parks, Recreation and Community Services Agency
City Council 13 – 4 12/6/2022
EXHIBIT A-1
City Council 13 – 5 12/6/2022
Name of Organization
Name of Funded Program
Annual Accomplishment Goal
4,000 Participants
315 Participants
Program and Funding Description
Schedule of Performance
Quarter 1: July 1 - September 30 200 Participants
Quarter 2: October 1 - December 31 185 Participants
Quarter 3: January 1 - March 31 165 Participants
Quarter 4: April 1 -June 30 150 Participants
700 Total unduplicated Santa Ana Participants to be served.

Schedule of Invoicing
Quarter 1: July 1 - September 30 $25,000
Quarter 2: October 1 - December 31 $25,000
Quarter 3: January 1 - March 31 $25,000
Quarter 4: April 1 -June 30 $25,000
$ 100,000.00 Total including contingeny

City of Santa Ana
Scope of Work
Meals on Wheels Orange Coungy
Home Delivered and Lunch Cafe Programs
I. Total number of unduplicated Participants (Santa Ana and Non-Santa Ana participants) anticipated to be served by the funded program, named above, during the second 6-month contract period, from Jan. 1, 2023 - June 30, 2023.

II. Number of ONLY unduplicated Santa Ana Participants to be served by the funded program, named above, during the second 6-month contract period, from Jan. 1, 2023 - June 30, 2023.

III. Description of Work - In the space below, describe the program to be funded during the 12-month contract period.

What specific activities will be undertaken during the contract period. Please be concise in your response. Only the viewable space will print.

Estimate the number of ONLY unduplicated Santa Ana participants to be served by the funded program during the 12- month contract period per quarter. (Enter number of new Santa Ana Participants served each quarter. If they were served in quarter 1 do not count them again in quarter 2) Exhibit A-1
For FY 22-23, Santa Ana discretionary funds not to exceed $100,000 ($90,300 for base services [Home Delivered Meals and Lunch Cafe Programs] and $9700 for additional as needed services) will be utilized to help fund the raw food costs of home delivered and Lunch Cafe meals to Santa Ana older adult participants from July 1, 2022 - June 30, 2023.

Home Delivered Meal Program:

Participants in the HDM Program will receive a total of 3 nutritious meals, 5 days a week delivered to their home along with case management services. Meals will be delivered by paid and volunteer drivers. Eligibility and case management services will be provided by Meals on Wheels Orange County Case Managers. Participants will also have access to other services at no charge including in-home services, respite services, home safety equipment, and other resources.

Lunch Cafe Program:

Participants in this Program will be provided with nutritional lunches at 2 sites in Santa Ana - Southwest Senior Center and Santa Ana Senior Center.

Additional As-Needed Services:

During the course of the year, the City conducts programs/services that may require additional meals to be provided that are beyond the scope of the programs listed above. In such instances, the City will request a quote from Community SeniorServ (dba Meals on Wheels Orange County) for additional cost and use contingency funds included in the total agreement amount.

City Council 13 – 6 12/6/2022
Information Technology
www.santa-ana.org/information-technology
Item # 14
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
December 6, 2022
TOPIC: Agreement With SDI Presence For Enterprise Resource Planning (ERP) System Selection Professional Services
AGENDA TITLE:

Approve Agreement with SDI Presence, LLP for Enterprise Resource Planning (ERP) System Selection Professional Services in an annual amount not to exceed $128,344 (Non-General Fund)

RECOMMENDED ACTION
Authorize the City Manager to execute an agreement for Enterprise Resource Planning (ERP) System Selection Professional Services with SDI Presence, LLP (SDI), for a term beginning January 1, 2023, and expiring June 30, 2024, for a total amount not to exceed $128,344, which includes a contingency in the amount of $25,669 subject to non-substantive changes approved by the City Manager and City Attorney.

DISCUSSION
The two primary applications that make up the City of Santa Ana’s Enterprise Resource Planning (ERP) system are the Infor Lawson Financial and Procurement system (Lawson) and the NeoGov High Line (High Line) Human Resources and Payroll system (HRMS). The City has been utilizing the existing Lawson financial system since September of 2009, and it has approximately 300 users citywide. The City uses the Lawson financial system to process, account for, maintain, track, and report on the City’s financial information and transactions. This includes functions for general ledger, accounts payable, billing, accounts receivable, cash management, procurement, inventory, asset management, grant management, projects and activities, budgeting control, business intelligence, and financial reporting. The system is used to produce the annual financial statements required by California state law and the City charter.

The City has been utilizing the High Line HRMS since December of 1999. This system is used to maintain personnel information, record time and attendance, process payroll, administer benefits, control positions, and forecast personnel costs. The system's employee and manager self-service portal is used by approximately 1,500 City employees to access their pay stubs, benefits, leave accrual balances, salary information, training, and other employee information.

City Council 14 – 1 12/6/2022
Agreement With SDI Presence For System Selection Professional Services December 6, 2022

The City owns perpetual software licenses for these systems and has regularly performed upgrades as the vendors have issued new releases. We are currently on the latest release of each system that each vendor offers that is not a cloud-based, Software-as-a-Service (SaaS) version. The software industry is trending towards the SaaS subscription licensing model, and most vendors no longer offer perpetual (onpremise) licensing or will not provide future upgrades to the legacy versions. In fact, the City has been told that there will not be any additional upgrades to the versions of our systems and we would be required to transition to the vendors’ SaaS versions in order to obtain any new enhancements.

Since the City will have to expend a large effort to migrate to a new software version, this is an ideal time to evaluate vendor solutions to see which systems would best meet the City’s current and future needs. As the City has not evaluated the marketplace for ERP systems for nearly 20 years, it is prudent to utilize a professional service consultant that has extensive, niche knowledge of current vendor offerings to assist us with our selection process.

Staff researched the City’s options to engage a firm for system selection professional services and subsequently received a proposal from SDI for ERP Consulting Services to assist with conducting a comprehensive needs assessment, developing an RFP, assisting with vendor evaluations, performing business process mapping, and assisting with vendor contract negotiations. SDI is uniquely qualified to perform this work, as they have more than 25 years of hands-on experience with ERP software procurement and implementations. They have worked with more than 200 West Coast clients and completed well over 50 ERP software selection projects for similarly-sized public sector agencies for both on-premise and SaaS (Cloud) ERP solutions. They have local Southern California staff that are able to be onsite as needed for the duration of the project and have hourly rates consistent with the industry marketplace. Contracting with SDI would reduce the administrative costs and time required to commence the project.

The proposal is for $102,675 and includes an option for additional services. The City has identified several financial business processes that we would like them to analyze for potential improvement prior to the implementation of a new system. Because the proposal cost is based on an estimate of hours required to perform the work and because the City may wish to add additional process areas to be analyzed, we are including a 25-percent contingency of $25,669 for a total not-to-exceed amount of $128,344.

ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.

City Council 14 – 2 12/6/2022
Agreement With SDI Presence For System Selection Professional Services December 6, 2022

FISCAL IMPACT
Funds in the amount of $128,344 are budgeted and available in the current fiscal year’s contract professional services account 62300, and remaining funds will be rolled over to the future fiscal year, if necessary, for a total aggregate amount not to exceed $128,344 over the life of the agreement. Estimated amounts expended per fiscal year are shown in the table below.

Fiscal
Year
Accounting Unit -
Account No.

Fund
Description
Accounting Unit
– Account No.

Description
Amount
2022-23 10920149-62300 Information
Technology
Projects –
Professional
Services
$70,000
2023-24 10920149-62300 Information
Technology
Projects –
Professional
Services
$58,344
Total: $128,344

EXHIBIT(S)

1. Agreement with SDI Presence, LLP
Submitted By: Jack Ciulla, Chief Technology Innovations Officer Approved By: Kristine Ridge, City Manager
City Council 14 – 3 12/6/2022
City Council 14 – 4 12/6/2022
City Council 14 – 5 12/6/2022
City Council 14 – 6 12/6/2022
City Council 14 – 7 12/6/2022
City Council 14 – 8 12/6/2022
City Council 14 – 9 12/6/2022
City Council 14 – 10 12/6/2022
City Council 14 – 11 12/6/2022
City Council 14 – 12 12/6/2022
City Council 14 – 13 12/6/2022
City Council 14 – 14 12/6/2022
City Council 14 – 15 12/6/2022
City Council 14 – 16 12/6/2022
City Council 14 – 17 12/6/2022
City Council 14 – 18 12/6/2022
City Council 14 – 19 12/6/2022
City Council 14 – 20 12/6/2022
City Council 14 – 21 12/6/2022
City Council 14 – 22 12/6/2022
City Council 14 – 23 12/6/2022
City Council 14 – 24 12/6/2022
City Council 14 – 25 12/6/2022
City Council 14 – 26 12/6/2022
City Council 14 – 27 12/6/2022
City Council 14 – 28 12/6/2022
City Council 14 – 29 12/6/2022
City Council 14 – 30 12/6/2022
City Council 14 – 31 12/6/2022
City Council 14 – 32 12/6/2022
City Council 14 – 33 12/6/2022
City Council 14 – 34 12/6/2022
City Council 14 – 35 12/6/2022
City Council 14 – 36 12/6/2022
City Council 14 – 37 12/6/2022
City Council 14 – 38 12/6/2022
City Council 14 – 39 12/6/2022
City Council 14 – 40 12/6/2022
City Council 14 – 41 12/6/2022
Finance and Management Services
www.santa-ana.org/finance
Item # 15
City of Santa Ana
20 Civic Center Plaza, Santa Ana, CA 92701
Staff Report
December 6, 2022
TOPIC: Debit and Credit Card Merchant Payment Processing Services AGENDA TITLE:

Approve a Renewal Agreement with TSYS Merchant Solutions, LLC, DBA Global Payments, for Debit and Credit Card Merchant Payment Processing Services, including Europay, MasterCard, and Visa (“EMV”) CHIP & Pin and e-Commerce Gateway Transaction Integration and Support and Maintenance in the Amount not to Exceed $1,898,400, which includes a General Contingency of $242,400

RECOMMENDED ACTION
Authorize the City Manager to execute a renewal agreement with TSYS Merchant Solutions, LLC, DBA Global Payments, for debit and credit card payment processing services, including Europay, MasterCard, and Visa (“EMV”) CHIP & Pin and e-Commerce gateway transaction integration and support and maintenance in an amount not to exceed $1,898,400, which includes a general contingency of $242,400 over the maximum sevenyear life of the agreement. The renewal agreement includes a base term commencing from December 6, 2022 and expiring December 31, 2025, with a provision for two renewal options of three years and one year, respectively, ending December 31, 2029, subject to non-substantive changes approved by the City Manager and City Attorney.

DISCUSSION
The Treasury & Customer Service Division (“Treasury”) of the Finance & Management Services Agency is responsible for maintaining all banking related services for the City.

A component of banking is debit and credit card merchant payment processing services.

Since 1997, City of Santa Ana residents have been able to use debit and credit cards to pay City of Santa Ana taxes, permits, fees, fines, and other charges due for City services.

Acceptance of a debit and/or credit card payment requires using a merchant service company such as TSYS Merchant Solutions, LLC, DBA Global Payments (“TSYS”).

MasterCard and Visa payment transactions are presented by TSYS on behalf of the City for all walk-in credit card payments made at City facilities, including, but not limited to, the following: City Hall Cashiering Counters, Police Department Traffic and Records Divisions, and the Santa Ana Zoo.

In March 2013, Treasury negotiated a significant reduction of the TSYS discount fee from

1.5% to 0%, which has helped the City offset City expenditures. TSYS has agreed to City Council 15 – 1 12/6/2022
Renewal Agreement with TSYS, DBA Global Payments
December 6, 2022

maintain the reduced rate for the term and optional extensions of their prior agreement and for the full term of the proposed renewal agreement. Year-after-year, Treasury has been able to track the rapid growth and popularity of debit and credit card payments made by Santa Ana residents and businesses.

In Fiscal Year 2021-22, there were approximately a total of 55,000 debit and credit card payment transactions at City facilities, which totaled $5,600,000 in collections for City taxes, permits, fees, fines, and other charges due for City services. Per City Council approval on June 21, 2016, the City currently does not pass on merchant processing fees to Santa Ana residents or businesses making debit/credit card payments for day-to-day City services as this widely encourages Santa Ana residents and businesses to submit timely, electronic payments. The City incurs a variety of charges covering the cost of these debit/credit card transactions. The amount of these charges vary from card type to card type, based on criteria established by the card issuer. In FY Year 2021-22, the City incurred a total of approximately $110,000 in expenditures with TSYS for debit/credit merchant processing fees.

To improve the security of debit and credit card payment transactions for Santa Ana residents, and to minimize the risk of a credit card information data breach, the City Council will be presented (at a future City Council Meeting) with a recommendation to approve a citywide upgrade of iNovah cashiering software and payment terminal hardware to EMV Chip & PIN contactless payment terminals and Payment Card Industry Data Security Standard (“PCI DSS”) compliance to protect credit card payment data.

Because of TSYS’ unique institutional knowledge of the City’s payment processing systems, they have created a System Integration Design, that includes an integration solution and support for the City’s new EMV Chip & Pin contactless payment terminals and software. Additionally, as part of the proposed upgrade to the City’s cashiering software and payment terminal hardware, American Express payment transactions will be introduced and presented (in addition to MasterCard and Visa) by TSYS on behalf of the City for all walk-in credit card payments made at City facilities.

TSYS’ merchant payment processing services are fully integrated into all City payment systems, including but not limited to enQuesta, the City’s water utility billing system.

Beginning in Fiscal Year 2019-20, the Finance & Management Services Agency (“FMSA”), Public Works Agency (“PWA”), and Information Technology Department (“IT”) undertook development of a program for the implementation of Advanced Metering Infrastructure (“AMI”) to provide modern smart metering services to the City’s water utility operation and for Municipal Utility Services (“MUS”) customers (to which TSYS’ services are tied). In March 2020, Treasury began an upgrade to the City’s existing water, sewer, sanitation, and refuse customer information service/utility billing system, enQuesta, to ensure the City is keeping up with best practices as they relate to utility customer service and billing technology, and to ensure compatibility with the City’s AMI program systems.

City Council 15 – 2 12/6/2022
Renewal Agreement with TSYS, DBA Global Payments
December 6, 2022

The AMI program is dependent on expanded use of the City’s upgraded MUS enQuesta system with which TSYS’ merchant payment processing services are integrated. TSYS’ services directly support and are bilaterally integrated with the MUS enQuesta upgrade.

Furthermore, the iNovah cashiering software is also scheduled to be integrated into the City’s new Land Management System, which will mostly require a software integration into TSYS’ merchant payment processing services as well. The cost to implement an equivalent merchant payment processing service is unknown, but would require new software and substantial additional integration expenses to the City as iNovah is fully integrated into all Treasury programs that require revenue processing services.

In addition to merchant payment processing services for the City’s walk-in cashiering stations, there are other related critical payment processing agreements like the City’s online cloud-based electronic billing and payment presentation/bill print services, 24- 7/365 walk-up payment kiosk services, and over-the-phone interactive voice response and payment services. Based on the synchronization of all of these payment-processing services, the City will achieve full PCI-DSS compliance, thereby transferring future credit card fraud liability from the City to the payment card providers. Moreover, renewal agreements for the City’s integrated Interactive Voice Response (“IVR”) contract and data processing, printing and mailing, and e-business services contracts have been constructed to be co-extensive with the underlying Systems & Software enQuesta MUS billing system software agreement. Because they are integrated with that agreement, they are effectively sole-source providers due to their extensive custom software systems integrations, which would be costly to replicate with another provider.

The enQuesta agreement with which this TSYS renewal agreement is synchronized runs through December 31, 2025, with optional extensions through December 31, 2029. Along with this recommendation for approval of the TSYS renewal agreement, at a future City Council Meeting date, the City Council will be presented with a recommendation to approve a City-wide upgrade to integrate the City’s iNovah cashiering software and payment hardware to EMV Chip & PIN contactless payment terminals with full PCI-DSS compliance. Therefore, staff recommends the approval of a renewal agreement with TSYS to assure annual merchant payment processing services for the City’s walk-in cashiering stations. By approving the TSYS renewal agreement, the City Council will be harmonizing agreements with other critical payment processing contracts, such as the enQuesta/AMI integrated project agreements.

ENVIRONMENTAL IMPACT
There is no environmental impact associated with this action.

FISCAL IMPACT
Funds for this renewal agreement and services are budgeted and available in various departmental Contract Services Professional accounts (No. Various-62300). Funds will be budgeted for expenditure as follows:

City Council 15 – 3 12/6/2022
Renewal Agreement with TSYS, DBA Global Payments
December 6, 2022

FY
Accounting
Unit -
Account
No.

Fund
Description
Accounting
Unit -
Accounting
No.

Description
Support
& Maint.

Contracted
Amount
Annual
Rate
Increase
(Contg.)
Maximum
Amount
2022
-23
Various62300 Various
Contract
Services
Professional
$5,000 $195,500 $29,325 $229,825
2023
-24
Various62300 Various
Contract
Services
Professional
$5,000 $195,500 $29,325 $229,825
2024
-25
Various62300 Various
Contract
Services
Professional
$5,000 $200,000 $30,000 $235,000
2025
-26
Various62300 Various
Contract
Services
Professional
$5,000 $210,000 $31,500 $246,500
2026
-27
Various62300 Various
Contract
Services
Professional
$5,000 $220,000 $33,000 $258,000
2027
-28
Various62300 Various
Contract
Services
Professional
$5,000 $230,000 $34,500 $269,500
2028
-29
Various62300 Various
Contract
Services
Professional
$5,000 $240,000 $36,000 $281,000
2029
-30
Various62300 Various
Contract
Services
Professional
$5,000 $125,000 $18,750 $148,750
Subtotal: Subtotal: Subtotal: Grand
Total:
$40,000 $1,616,000 $242,400 $1,898,400

EXHIBIT(S)

1. TSYS Merchant Solutions, LLC, DBA Global Payments, Agreement Submitted By: Kathryn Downs, FMSA Executive Director
Approved By: Kristine Ridge, City Manager
City Council 15 – 4 12/6/2022

RENEWAL AGREEMENT

CITY OF SANTA ANA
THIS RENEWAL AGREEMENT (“Agreement”) is made and entered into on this 6th day of December 2022, by and between TSYS Merchant Solutions, LLC, dba Global Payments, Inc. & Its Subsidiaries, a Georgia corporation (“Consultant”), and the City of Santa Ana, a charter city and municipal corporation organized and existing under the Constitution and laws of the State of California (“City”).

RECITALS
A. The City desires to retain a consultant having special skill and knowledge in the field of debit and credit card merchant payment processing services, including gateway transaction integration and support services.

B. Consultant represents that Consultant is able and willing to provide such services to the City.

C. The parties entered into an original agreement (A-2021-225) for debit and credit card merchant payment processing services, including gateway transaction integration and support services and now wish to renew said agreement for a multi-year term.

D. In undertaking the performance of this Agreement, Consultant represents that it is knowledgeable in its field and that any services performed by Consultant under this Agreement will be performed in compliance with such standards as may reasonably be expected from a professional consulting firm in the field.

NOW THEREFORE, in consideration of the mutual and respective promises, and subject to the terms and conditions hereinafter set forth, the parties agree as follows:

1. SCOPE OF SERVICES
Consultant shall perform during the term of this Agreement, the tasks and obligations including all labor, materials, tools, equipment, and incidental customary work required to fully and adequately complete the services described and set forth in the Merchant Card Processing Agreement attached hereto as Exhibit A. 2. COMPENSATION City agrees to pay, and Consultant agrees to accept as total payment for its services for City, the rates and charges identified in the Client Satisfaction Offer, which shall be deemed inclusive of all fees and charges payable by City, attached hereto as Exhibit B. For the full Term of this Agreement as covered under the provisions as set out herein below, funds to be expended shall not exceed a base contracted amount of $1,616,000, together with an annual $5,000 support and maintenance amount and a general annual contingency amount of 15%, for a combined maximum amount of $1,898,400, which sum shall constitute the Maximum Contract Compensation Cap.

EXHIBIT 1
City Council 15 – 5 12/6/2022

a. The breakdown of these expendable funds by fiscal year shall be as set forth in the Contract Expenditure Table shown below:

Contract Expenditure Table
Fiscal Year
Support &
Maintenance
Amount
Base
Contract
Amount
Percent
Contingency
Contingency
Amount
Maximum
Expenditure
Amount
FY 2022-23 $5,000 $195,500 15% $29,325 $229,825
FY 2023-24 $5,000 $195,500 15% $29,325 $229,825
FY 2024-25 $5,000 $200,000 15% $30,000 $235,000
FY 2025-26 $5,000 $210,000 15% $31,500 $246,500
FY 2026-27 $5,000 $220,000 15% $33,000 $258,000
FY 2027-28 $5,000 $230,000 15% $34,500 $269,500
FY 2028-29 $5,000 $240,000 15% $36,000 $281,000
FY 2029-30 $5,000 $125,000 15% $18,750 $148,750
$40,000 $1,616,000 $242,400 $1,898,400
b. Payment by City shall be made within forty-five (45) days following receipt of proper invoice evidencing work performed, subject to City accounting procedures. Payment need not be made for work which fails to meet the standards of performance set forth in the Recitals which may reasonably be expected by City. Billing or invoice statements shall be presumed to have been received three (3) days after they are mailed or twenty- four (24) hours after being electronically transmitted in accordance with the provisions of Section 13 of this Agreement (“NOTICE”).
c. Change Order Contingency: During the term of this Agreement, City may request optional services of Consultant at mutually agreed upon scope and fees.

1. Change Order
No extra work may be undertaken unless a written "Change Order" is first given by the Contract Officer or his/her designee, to Consultant, incorporating therein any material change in the scope, fees and/or administration of this Agreement proposed by City.

2. Additional Work or Services
(a) Extra Work or Services
City shall have the right at any time during the performance of the work or services set forth in this Agreement, without invalidating said Agreement or any amendments thereto, to elect to exercise any existing option specified in the Scope of Services for extra work or services or to order extra work or services pursuant to a duly executed Change Order or to expend previously appropriated, but unspent contingency funds authorized to be carried forward by the Executive Director of Finance and Management Services to cover expenses for work or services agreed to by the parties but exceeding any annual City City Council 15 – 6 12/6/2022

fiscal year compensation amount cap initially specified under the Compensation provisions of this Agreement or thereby make changes by altering, adding to or deducting from said work or services.
(b) Maximum Contract Compensation Cap
Net total compensation to Consultant shall not, as the result of any Change Order, exceed the maximum contract compensation amount set forth under Section 2 (“COMPENSATION”), subsection a. of this Agreement, unless an increase in maximum contract compensation is agreed to by the parties pursuant to a duly executed amendment of this Agreement.
d. Coordination of Work or Services

1. Representative of Consultant
The following officer of Consultant is hereby designated as being the representative of Consultant authorized to act in its behalf with respect to the work specified herein and make all decisions in connection therewith:

Global Payments Integrated Carl Van Laethem
Representative Client Success Advisor/National Accounts It is expressly understood that the experience, knowledge, capability and reputation of the foregoing officer & representative is a substantial inducement for City to enter into this Agreement. Therefore, the foregoing representative shall be responsible during the term of this Agreement for directing all activities of Consultant and devoting sufficient time to personally supervise the services hereunder. For purposes of this Agreement, the foregoing officer & representative may not be replaced nor may their responsibilities be substantially reduced by Consultant without the express written approval of City.

2. Contract Officer
The Contract Officer shall be the person designated hereunder by City. It shall be Consultant's responsibility to assure that City's Contract Officer is kept informed of the progress of the performance of the consulting services set forth in this Agreement and Consultant shall refer any decisions which must be made by City to the Contract Officer.

The Contract Officer shall have authority to enter into Change Orders with Consultant pursuant to this Agreement. The Contract Officer shall have authority to sign all documents on behalf of City required hereunder to carry out the terms of this Agreement. Unless otherwise specified herein, any approval of City required hereunder shall mean the approval of the Contract Officer.

City of Santa Ana
Contract Officer
Kristine Ridge, City Manager
or designee

3. TERM
City Council 15 – 7 12/6/2022

The base term of this Agreement shall commence on the date first written above and shall expire on December 31, 2025, with provision for two extension options of three years, and one year; respectively, ending December 31, 2029, unless terminated earlier in accordance with Section 9, below. This Agreement shall cover all services provided by Consultant since July 1, 2022.

4. INDEPENDENT CONTRACTOR
Consultant shall, during the entire term of this Agreement, be construed to be an independent contractor and not an employee of the City. This Agreement is not intended nor shall it be construed to create an employer-employee relationship, a joint venture relationship, or to allow the City to exercise discretion or control over the professional manner in which Consultant performs the services which are the subject matter of this Agreement; however, the services to be provided by Consultant shall be provided in a manner consistent with all applicable standards and regulations governing such services. Consultant shall pay all salaries and wages, employer's social security taxes, unemployment insurance and similar taxes relating to employees and shall be responsible for all applicable withholding taxes.

5. INSURANCE
Prior to undertaking performance of work under this Agreement, Consultant shall produce and maintain for the duration of the Agreement claims for security breaches, system failures, injuries to persons, damages to software, or damages to property (including computer equipment) which may arise from or in connection with the performance of the work hereunder by the Consultant and shall require its subcontractors, agents, representatives, or employees, if any, to obtain and maintain insurance as described below. Consultant shall procure and maintain for the duration of the contract insurance claims arising out of their services and including, but not limited to loss, damage, theft or other misuse of data, invasion of privacy and breach of data. a. Minimum Scope and Limit of Insurance

1. Commercial General Liability (CGL): Insurance Services Office Form CG 00 01 covering CGL on an “occurrence” basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than $2,000,000 per occurrence, $4,000,000 aggregate. Limits can be obtained with a combination of primary and excess/umbrella coverages.

2. Automobile Liability: Insurance Services Office Form Number CA 0001 covering, Code 1 (any auto), or if Consultant has no owned autos, Code 8 (hired) and 9 (non- owned), with limit no less than $2,000,000 per accident for bodily injury and property damage. Limits can be obtained with a combination of primary and excess/umbrella coverages.

3. Workers’ Compensation insurance as required by the State of California, with Statutory Limits, and Employer’s Liability Insurance with limit of no less than $1,000,000 per accident for bodily injury or disease.

4. Cyber Liability Insurance, with limits not less than $2,000,000 per occurrence City Council 15 – 8 12/6/2022

or claim, $2,000,000 aggregate. Coverage shall be sufficiently broad to respond to the duties and obligations as is undertaken by Consultant in this agreement and shall include, but not be limited to, claims involving security breach, system failure, data recovery, business interruption, cyber extortion, social engineering, infringement of intellectual property, including but not limited to infringement of copyright, trademark, trade dress, invasion of privacy violations, information theft, damage to or destruction of electronic information, release of private information, and alteration of electronic information. The policy shall provide coverage for breach response costs, regulatory fines and penalties as well as credit monitoring expenses.

5. Technology Professional Liability Errors and Omissions Insurance appropriate to the Consultant’s profession and work hereunder, with limits not less than $2,000,000 per occurrence, $2,000,000 aggregate. Coverage shall be sufficiently broad to respond to the duties and obligations as is undertaken by the Consultant in this agreement and shall include, but not be limited to, claims involving security breach, system failure, data recovery, business interruption, cyber extortion, social engineering, invasion of privacy violations, information theft, damage to or destruction of electronic information, release of private information, and alteration of electronic information. The policy shall provide coverage for breach response costs, regulatory fines and penalties as well as credit monitoring expenses.
i. The Policy shall include, or be endorsed to include, property damage liability coverage for damage to, alteration of, loss of, or destruction of electronic data and/or information “property” of the Agency in the care, custody, or control of the Consultant. If not covered under the Consultant’s liability policy, such “property” coverage of the Agency may be endorsed onto the Consultant’s Cyber Liability Policy.

6. Crime liability insurance with a limit of not less than $1,000,000 per claim with $2,000,000 in the aggregate. The following requirements apply to the insurance to be provided by Consultant pursuant to this section:
i. Consultant shall maintain all insurance required above in full force and effect for the entire period covered by this Agreement. ii. Certificates of insurance shall be furnished to the City upon execution of this Agreement and shall be approved by the City.
iii. City of Santa Ana, its officers, employees, agents and representatives shall be Additional Insureds with respect to General Liability Insurance and Auto Liability Insurance is Primary and Non-Contributory. iv. Certificates and policies shall state that the policies shall not be canceled without thirty (30) days prior written notice to the City of cancellation with ten (10) days prior notice for non-payment of premium in accordance with policy provisions. Similar notice of reduction or City Council 15 – 9 12/6/2022

material change shall be given if coverage falls below or is not in compliance with the contract requirements.
v. Consultant shall supply City with a fully executed additional insured endorsement.
vi. Certificates of insurance endorsements shall show the City as a certificate holder as follows:

City of Santa Ana
Risk Management Division, 4th Floor 20 Civic Center Plaza Santa Ana, CA 92701
vii. Where the amounts or coverage provided by the certificates of insurance provides coverage greater than those listed by this Agreement, the amounts provided by the certificates of insurance shall be incorporated by reference into the Agreement.

7. Broader Coverage: If the Consultant maintains broader coverage and/or higher limits than the minimums shown above, the Entity requires and shall be entitled to the broader coverage and/or the higher limits maintained by the contractor.

Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the Entity.

8. If Consultant fails or refuses to produce or maintain the insurance required by this section or fails or refuses to furnish the City with required proof that insurance has been procured and is in force and paid for, the City shall have the right, at the City’s election, to forthwith terminate this Agreement. Such termination shall not affect Consultant’s right to be paid for its time and materials expended prior to notification of termination. Consultant waives the right to receive compensation and agrees to indemnify the City for any work performed prior to approval of insurance by the City.
a. Other Insurance Provisions

1. Additional Insured Status: The Entity, its officers, officials, employees, and volunteers are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of the Consultant including materials, parts, or equipment furnished in connection with such work or operations. General liability coverage can be provided in the form of an endorsement to the Consultant’s insurance (at least as broad as ISO Form CG 20 10 11 85 or both CG 20 10, CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 forms if later revisions used). Please note, if there is an insured vs. insured exclusion on the Consultant’s policy, carefully review with the Consultant and their insurance carrier on whether being added as an additional insured onto the Consultant’s policy removes your organization’s ability to file suit against the Consultant and draw upon the policy should final adjudication in a lawsuit state that the Consultant shall pay damages to your organization.

City Council 15 – 10 12/6/2022

2. Primary Coverage: For any claims related to this contract, the Consultant’s insurance coverage shall be primary. Coverage for commercial liability shall be at least as broad as ISO CG 20 01 04 13 as respects the Entity, its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the Entity, its officers, officials, employees, or volunteers shall be excess of the Consultant’s insurance and shall not contribute with it.

3. Notice of Cancellation: Each insurance policy required above shall state that coverage shall not be canceled, except with notice to the Entity.

4. Waiver of Subrogation: Consultant hereby grants to Entity a waiver of any right to subrogation which any insurer of said Consultant may acquire against the Entity by virtue of the payment of any loss under such insurance. Consultant agrees to obtain any endorsement that may be necessary to affect this waiver of subrogation, but this provision applies regardless of whether or not the Entity has received a waiver of subrogation endorsement from the insurer.

5. Self-Insured Retentions: Self-insured retentions must be declared to the Entity.

The Entity may require the Consultant to provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention.

6. Acceptability of Insurers: Insurance is to be placed with insurers authorized to conduct business in the state with a current A.M. Best’s rating of no less than A- :VII, unless otherwise acceptable to the Entity.

7. Claims Made Policies: If any of the required policies provide coverage on a claims-made basis:
i. The Retroactive Date must be shown and must be before the date of the contract or the beginning of contract work.
ii. Insurance must be maintained and evidence of insurance must be provided for at least three (3) years after completion of the contract of work. iii. If coverage is canceled or non-renewed, and not replaced with another claimsmade policy form with a Retroactive Date prior to the contract effective date, the Consultant must purchase “extended reporting” coverage for a minimum of three (3) years after completion of contract work.

8. Verification of Coverage: Consultant shall furnish the Entity with original Certificates of Insurance including all required amendatory endorsements (or copies of the applicable policy language effecting coverage required by this clause) and a copy of the Declarations and Endorsement Page of the CGL policy listing all policy endorsements to the Entity before work begins. However, failure to obtain the required documents prior to the work beginning shall not waive the Consultant’s obligation to provide them. The Entity reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time.

City Council 15 – 11 12/6/2022

9. Subcontractors: Consultant shall require and verify that all subcontractors maintain insurance meeting all the requirements stated herein, and Consultant shall ensure that Entity is an additional insured on insurance required from subcontractors.
10 Special Risks or Circumstances: Entity reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.

6. NON-DISCRIMINATION
Consultant shall not discriminate because of race, color, creed, religion, sex, marital status, sexual orientation, age, national origin, ancestry, or disability, as defined and prohibited by applicable law, in the recruitment, selection, training, utilization, promotion, termination or other employment related activities. Consultant affirms that it is an equal opportunity employer and shall comply with all applicable federal, state and local laws and regulations.

7. EXCLUSIVITY AND AMENDMENT
This Agreement represents the complete and exclusive statement between the City and Consultant, and supersedes any and all other agreements, oral or written, between the parties. In the event of a conflict between the terms of this Agreement and any attachments hereto, the terms of this Agreement shall prevail. This Agreement may not be modified except by written instrument signed by the City and by an authorized representative of Consultant. The parties agree that any terms or conditions of any purchase order or other instrument that are inconsistent with, or in addition to, the terms and conditions hereof, shall not bind or obligate Consultant or the City.

Each party to this Agreement acknowledges that no representations, inducements, promises or agreements, orally or otherwise, have been made by any party, or anyone acting on behalf of any party, which is not embodied herein.

8. ASSIGNMENT
Inasmuch as this Agreement is intended to secure the specialized services of Consultant, Consultant may not assign, transfer, delegate, or subcontract any interest herein without the prior written consent of the City and any such assignment, transfer, delegation or subcontract without the City's prior written consent shall be considered null and void. Nothing in this Agreement shall be construed to limit the City’s ability to have any of the services which are the subject to this Agreement performed by City personnel or by other consultants retained by City.

9. TERMINATION
This Agreement may be terminated by the City upon thirty (30) days written notice of termination. In such event, Consultant shall be entitled to receive and the City shall pay Consultant compensation for all services performed by Consultant prior to receipt of such notice of termination, subject to the following conditions:

1. As a condition of such payment, the Executive Director of Finance and Management Services may require Consultant to deliver to the City all work product(s) completed City Council 15 – 12 12/6/2022

as of such date, and in such case such work product shall be the property of the City unless prohibited by law, and Consultant consents to the City's use thereof for such purposes as the City deems appropriate.

2. Payment need not be made for work which fails to meet the standard of performance specified in the Recitals of this Agreement.

10. WAIVER
No waiver of breach, failure of any condition, or any right or remedy contained in or granted by the provisions of this Agreement shall be effective unless it is in writing and signed by the party waiving the breach, failure, right or remedy. No waiver of any breach, failure or right, or remedy shall be deemed a waiver of any other breach, failure, right or remedy, whether or not similar, nor shall any waiver constitute a continuing waiver unless the writing so specifies.

11. JURISDICTION - VENUE
This Agreement has been executed and delivered in the State of California and the validity, interpretation, performance, and enforcement of any of the clauses of this Agreement shall be determined and governed by the laws of the State of California. Both parties further agree that Orange County, California, shall be the venue for any action or proceeding that may be brought or arise out of, in connection with or by reason of this Agreement.

12. PROFESSIONAL LICENSES
Consultant shall, throughout the term of this Agreement, maintain all necessary licenses, permits, approvals, waivers, and exemptions necessary for the provision of the services hereunder and required by the laws and regulations of the United States, the State of California, the City of Santa Ana and all other governmental agencies. Consultant shall notify the City immediately and in writing of its inability to obtain or maintain such permits, licenses, approvals, waivers, and exemptions. Said inability shall be cause for termination of this Agreement.

13. NOTICE
Any notice, tender, demand, delivery, or other communication required or made pursuant to this Agreement shall be in writing and shall be deemed to be properly given if delivered in person or mailed by first class or certified mail, postage prepaid, or by express mail courier (i.e.

FedEx, UPS, etc.), or sent by fax or email communication in the manner provided in this section.

Any such notice shall be addressed to the other party at the address set forth below. Consultant invoice/billing statement notices to City shall be sent to City’s Primary Representative/Project Manager or designees. All notices, including invoice/billing statement notices and notices of address changes, provided under this Agreement are deemed received on the third day after mailing if sent by regular mail, or the next day if sent by overnight delivery. If sent by fax, communication shall be effective or deemed to have been given twenty-four (24) hours after the time set forth on the transmission report issued by the transmitting facsimile machine, addressed as set forth above. If sent by email, communication shall be effective or deemed to have been given twenty-four (24) hours after the time set forth on the delivery time stamp notated by the internet service provider, addressed as set forth above. For purposes of calculating these time frames, City Council 15 – 13 12/6/2022

weekends, City Hall closure dates, federal, state, County or City holidays shall be excluded.

If to City:

Clerk of the City Council
City of Santa Ana
20 Civic Center Plaza (M-30)
P.O. Box 1988
Santa Ana, CA 92702-1988
Fax: (714) 647-6956
With courtesy copies to:

Executive Director
Finance and Management Services Agency
City of Santa Ana
20 Civic Center Plaza (M- 17)
Santa Ana, CA 92702
Phone: (714) 647-6960
Fax: (714) 647-5414
If to Consultant:

TSYS Merchant Solutions, LLC, dba Global Payments
Attn: David Green
Corporate Secretary
One Heartland Way
Jefferson, IL 47130
Fax: (480) 333-7979
Representative or designees
Consultant Primary Representative/Project Manager shall be:

Carl Van Laethem
Client Success Advisor/National Accounts
Global Payments Integrated
Phone: (801) 772-1671
Email: [email protected]
City Primary Representative/Project Manager shall be:

Willard Holt, Treasury and Customer Services Manager
20 Civic Center Plaza (M-15), Room 1105
Santa Ana, CA 92701
Phone: (714) 647-5456
Fax: (714) 647-5304
Email: [email protected]
City Council 15 – 14 12/6/2022

City Alternate Representative/Project Manager shall be:

Alex Gutierrez, Senior Analyst
Treasury and Customer Service Division
20 Civic Center Plaza (M-15), Room 1103
Santa Ana, CA 92701
Phone: (714) 647-5497
Fax: 714-647-5304
Email: agutierrez @santa-ana.org
A party may change its address or representative or designees by giving notice in writing to the other party. Thereafter, any communication shall be addressed and transmitted to the new address and/or new representative or designees.

14. COUNTERPART SIGNATURE AND DELIVERY
This Agreement must be signed below and may be signed in separate counterparts including facsimile copies and delivered by fax, email as a PDF (Portable Document Format) file attachment, or by other means that displays the original or a copy of the signatures. Each counterpart (including facsimile copies) is deemed an original and all counterparts are deemed on and the same instrument and legally binding on the parties. Any subsequent amendments to this Agreement may be signed and delivered in the same manner.

15. MISCELLANEOUS PROVISIONS

1. Each undersigned represents and warrants that its signature herein below has the power, authority and right to bind their respective parties to each of the terms of this Agreement, and shall indemnify City fully, including reasonable costs and attorney’s fees, for any injuries or damages to City in the event that such authority or power is not, in fact, held by the signatory or is withdrawn.

2. All Exhibits referenced herein and attached hereto shall be incorporated as if fully set forth in the body of this Agreement. Provided however, that in the event that any provision of any exhibit is in direct conflict with the provisions of this Agreement then the terms of this Agreement will prevail solely with respect to any such directly conflicting provisions, or portions thereof. //
//
{Signatures on following page}
City Council 15 – 15 12/6/2022

IN WITNESS WHEREOF, the patties hereto have executed this Agreement the date and year first above written.

ATTEST: CITY OF SANTA ANA
Clerk of the Council Kristine Ridge
City Manager
APPROVED AS TO FORM:

Sonia R. Carvalho
City Attorney
_____________________________ By: Ryan O. Hodge
Assistant City Attorney
RECOMMENDED FOR APPROVAL:

CONSULTANT: _____________________________ David Green
Corporate Secretary
____________________________ Kathryn Downs
Executive Director
Finance and Management Services Agency
City Council 15 – 16 12/6/2022

EXHIBIT A

MERCHANT CARD PROCESSING AGREEMENT
City Council 15 – 17 12/6/2022

MERCHANT CARD PROCESSING AGREEMENT
PLEASE READ SECTION 20 (“ATTORNEY FEES; ARBITRATION; CLASS ACTION WAIVER”) CAREFULLY AS IT RELATES TO ARBITRATION AND

CLASS ACTIONS
While all terms in this Merchant Agreement are important, here is a summary of some sections on which we occasionally receive questions. These are common clauses in merchant processing agreements throughout our industry.

The introductory paragraphs explain that the Merchant Agreement consists of other documents in addition to this Merchant Agreement.

We can amend your Merchant Agreement by providing you with 15 days’ notice or, under certain circumstances, with less than 15 days’ notice (see section 10).

Unless confirmed otherwise on your application, the initial term of this Merchant Agreement is three years. If you terminate early without cause, you may be required to pay an early termination fee (see section 11).

The proceeds you receive from transactions are provisional credits. We can charge or debit your settlement account to recover these provisional credits. We can also debit your Settlement Account to recover other amounts that you may owe us (see Section 12).

If you dispute any charge or funding, you must notify us within 30 days of the date of the statement (see section 12.5).

In some circumstances, we may require the establishment of a reserve account with us so we can mitigate risks. Section 13 explains how that reserve account will be funded and how we may use money in that account.

Our processing fees are set out in detail in the Merchant Application. We may change these fees, but must ordinarily notify you before doing so (see Section 16).

This agreement contains an arbitration clause (see Section 20.2) and a class action waiver (see Section 20.3).

This agreement is a complete and final agreement between us. It supersedes any previous negotiations we may have had on the services and products. (Section 21).

This Merchant Card Processing Agreement (“MPA”) is for merchant card payment processing services among the merchant (“Merchant”) that signed the Application for Merchant Card Processing (“Merchant Application”), Member Bank, and Processor. The Merchant Application and the MPA are part of the “Merchant Agreement” as defined below.

Subject to the requirements of the Operating Rules, Processor and Member Bank reserve the right to allocate duties and obligations amongst themselves as they agree appropriate in their sole discretion, and Member Bank or Processor may jointly or individually assert or exercise any rights or remedies provided hereunder. If Merchant wishes to address any act or omission by, or make or bring any claim or action against, Merchant Bank or Processor relating to this Merchant Agreement, it shall first discuss such issue with Processor prior to making or bringing any claim or action against Member Bank (in which case Processor shall address the issue as agreed with Member Bank). Member Bank is responsible for sponsoring Merchant with Visa and Mastercard, and for settlement of Merchant sales funds. Unless otherwise noted, all other products, services and obligations to Merchant are the sole responsibility of Processor.

VISA®, Inc. (“Visa”) and Mastercard® International, Inc. (“Mastercard”), the Discover® Network (“Discover”), and the American Express® Network (“American Express”) are collectively known herein as the “Card Associations.” If elected by Merchant on the Merchant Application, Processor will settle American Express® Card and Discover® Network transactions in accordance with the terms set forth in the Merchant Application and in doing so, Processor does not represent or indicate in any way that Member Bank sponsors Processor into the American Express Network and Discover Network. If Merchant elects and is approved to participate in the American Express OptBlue Program, Merchant agrees to comply with the American Express OptBlue Merchant Operating Guide, which may be accessed at www.americanexpress.com/merchantopguide. Member Bank does not sponsor Processor into the American Express Network and Discover Network, is not providing or agreeing to provide Merchant any services hereunder with respect to American Express Card and Discover Network Card transactions, does not determine or approve or agree upon any fees, charges, pricing, or any other terms and conditions, relating to American Express Card and Discover Network Card transactions, and has no responsibility or liability to Merchant for American Express Card and Discover Network Card transactions. Nor does Member Bank provide or agree to provide Merchant any services hereunder or have any responsibility or liability to Merchant with respect to any PIN-based debit or stored value or electronic benefit transfer transactions (except only to the extent, if any, required under Visa’s or Mastercard’s Operating Rules or mandatory provisions of applicable law), or any PayPal transactions, JCB, Carte Blanche, or other Card type transactions (other than Visa and Mastercard Credit and non-PIN based debit/stored value /electronic benefit transactions, including any such transactions made with Diner’s International Cards which also carry the Mastercard Mark and are processed as Mastercard transactions), any CrossCheck or other Check Services transactions, merchant gift or loyalty card transactions, or any other services specified in the Merchant Application as covered in whole or in part by this Agreement but as not being provided by Member Bank. No reference to Member Bank herein shall be deemed to create any obligations or liability of Member Bank with respect to American Express Card or American Express Network transactions or Discover Network Cards or Discover Network Card transactions, or to any of the other types of Cards, transactions or services referred to above or in the Merchant Application as not being provided by Member Bank.

The appendices, addenda (including but not limited to the ACH Addendum, and Petro Addendum if applicable), schedules, Fee Schedule, applicable product or services terms as indicated on the Merchant Application, and ACH Terms and Conditions that accompany this MPA, as amended from time to time as provided herein, are part of the terms and conditions of this MPA, as are the Merchant Application and the Operating Rules, and are hereinafter individually and collectively referred to as the “Merchant Agreement.” The Operating Rules for Visa are located at https://usa.visa.com/support/consumer/visa-rules.html, and the Operating Rules for Mastercard are located at https://www.mastercard.us/enus/business/overview/support/rules.html.

Capitalized terms used in this Merchant Agreement which are not defined herein shall have the meaning given to them in the Merchant Application, which is incorporated by reference into this Agreement and may be amended from time to time by Merchant Bank or Processor upon notice to Merchant.

According to the processing services selected by Merchant on the Merchant Application and, in accordance with the terms of this Merchant Agreement and applicable Operating Rules, Merchant agrees to participate in Processor’s Card processing program by honoring Cards in accordance with this Merchant Agreement; and to submit Transaction Receipts, Credit Transaction Receipts and other electronic data to Processor for the Card Program services provided by Processor.

With respect to Visa and Mastercard Transactions:

Member Bank is responsible for providing settlement funds directly to Merchant, and Processor shall not have access to or hold settlement funds.

1. MERCHANT’S APPLICATION AND INFORMATION. By completing the Merchant Application, Merchant applies for the Card Program services covered by the Merchant Application and the Merchant Agreement. In their sole and absolute discretion, Processor and/or Member Bank may accept or reject Merchant’s Merchant Application.

Merchant may present Transactions to Processor only for the activities and in the volumes described on the Merchant Application, including the percentage of Mail/Phone Order and Electronic Commerce Transactions. The earlier date of the presentation of the first Transaction, including any test Transaction, by Merchant to Processor or the date Processor approves the Merchant Application signifies the effective date of the Merchant Agreement (the “Effective Date”). By either Merchant’s signature on the Merchant Application or Merchant’s processing a Transaction (including a test Transaction) with Processor, Merchant affirmatively accepts and agrees to be bound by the Merchant Agreement.

2. MERCHANT’S GENERAL DUTIES.

2.1 General. Merchant will comply with the Merchant Agreement for submitting and processing Transactions with Processor. Processor is responsible to Merchant for processing Transactions under the Operating Rules for the Card Program services to which Merchant subscribes, which may vary among Card types.

2.2 Merchant’s Responsibility for Acts of Others. Merchant, and not Member Bank or Processor, is responsible for any advice from, acts of, as well as omissions, acts of fraud or acts of misconduct by, Merchant’s employees, processors, consultants, advisors, contractors, Merchant Servicers, Agents, officers and directors. Merchant, and not Member Bank or Processor, is responsible for the use, unauthorized use or misuse of Merchant’s equipment, POS Equipment, or software.

2.3 Electronic and Paperless Notices and Disclosures. Merchant consents to receiving electronically rather than in paper form all written notices, disclosures and other documents (“Documents”) which are to be provided by Processor to Merchant under the Merchant Agreement. Processor will notify Merchant that a Document is available at Processor’s web site with a link to that specific page of the web site containing the Document.

Merchant agrees that such notification may be sent to Merchant at the e-mail address provided as part of the Merchant Application.

By Merchant affirmatively checking the box to consent to receive paperless delivery of IRS Notices on the Merchant Application, if applicable, Merchant acknowledges that it has reviewed and received the Consent to Paperless Delivery of IRS Notices, located at http://www.tsys.com/documents.html and that Merchant consents and agrees to receive IRS notifications by paperless delivery.

Merchant understands and acknowledges that access to the Internet and e-mail are required for Merchant to access Documents electronically or by paperless delivery and Merchant confirms that Merchant has such access. Merchant understands that there are costs related to accessing Documents electronically or by paperless delivery and Merchant agrees that Merchant is responsible for these related access costs.

At any time, and without giving Merchant advance notice, Member Bank and/or Processor may elect not to send a Document electronically or by paperless delivery, in which case a paper copy of the Document will be sent to Merchant at Merchant’s last known address, as provided by Merchant, or such Document shall otherwise be provided as provided for herein.

3. PROCEDURES FOR CARD TRANSACTIONS.

3.1 Honoring Cards.
(a) Limited Acceptance. If appropriately indicated herein, Merchant shall be a Limited Acceptance Merchant, which means that Merchant has elected to accept only certain Visa and Mastercard card types as indicated on the Merchant Application, or via later notification. The Visa or Mastercard Credit acceptance option on the Merchant Application refers to Visa Credit and Business transactions, and is what Mastercard refers to as “Other Card” transactions. Notwithstanding anything to the contrary in the Application, Merchant can elect (i) to accept only Visa or Mastercard non-PIN based debit/stored value/electronic benefit transactions (sometimes referred to as “signature debit” transactions, whether or not an actual signature is required), or (ii) to accept only Visa or Mastercard Credit transactions, or (iii) to accept all Visa or Mastercard Credit and signature debit transactions; provided, however, that a Merchant who accepts any Visa or Mastercard Card types must accept all City Council valid Visa or Mastercard Card types issued by a non-U.S. issuer. Merchant is not required 15 – 18 12/6/2022

to accept Card brands other than Visa or Mastercard in order to accept Visa or Mastercard Cards (except that transactions using Diner’s International Cards which also carry the Mastercard Mark must be accepted if Merchant accepts Mastercard Card transactions of the same type). Merchant Bank and Processor have no obligation other than those expressly provided under the Operating Rules and applicable law as they may relate to Limited Acceptance. Member Bank’s and Processor’s obligations do not include policing card types at the point of sale. Merchant will be solely responsible for the implementation of its decision for limited acceptance including but not limited to policing the card type(s) of transactions at the point of sale submitted for processing by Processor. Should Merchant submit a transaction for processing for a card type it has indicated it does not wish to accept, Processor may process that transaction and Merchant will pay the applicable fees, charges, and assessments associated with that transaction. Merchant will comply with any applicable laws and Operating Rules for the card type processed.
(b) Discover. If Merchant has chosen to accept Discover Card Transactions in the Merchant Application, Merchant must accept Discover Cards at all Merchant establishments, including in payment for purchases of goods and services, for charitable contributions and for Cash Over Transactions, when properly presented for payment by a Cardholder. Subject to this Section, a Merchant must create a Transaction Receipt for each Discover Card Transaction and deliver at least one copy of the Transaction Receipt to the Cardholder. A Merchant may issue a Cash Over in connection with a Discover Card Transaction. Merchant must deliver a single Authorization Request for the aggregate total of the goods/services purchase amount and the Cash Over amount. In addition, the Transaction Receipt must include both the purchase amount and the Cash Over amount. (c) PayPal™. If Merchant has chosen to accept PayPal Payment Card Transactions in the Merchant Application, Merchant must accept PayPal Payment Cards at all Merchant establishments, including in payment for purchases of goods and services and for charitable contributions when properly presented for payment by a Cardholder. Subject to this Section, a Merchant must create a Transaction Receipt for each PayPal Card Transaction and deliver at least one copy of the Transaction Receipt to the Cardholder. (d) American Express. If Merchant has chosen to accept American Express® Cards in the Merchant Application, Merchant must accept American Express Cards as payment for goods and services sold, or (if applicable) for charitable contributions made, at all of its establishments, except as expressly permitted by state statute. Merchant is jointly and severally liable for the obligations of Merchant’s establishments under the Merchant Agreement. In the event Merchant’s American Express annual charge volume exceeds $1,000,000 in a rolling twelve month period or is greater than $100,000 in any three consecutive months, Merchant will be considered a High CV Merchant by American Express and will be required to enter into a direct merchant card acceptance agreement with American Express. Upon any conversion to a direct agreement with American Express, Merchant will be bound by American Express’ then current Card Acceptance Agreement and to any pricing and fees set by American Express. Merchant has the right to opt-out of acceptance of American Express Cards at any time without affecting Merchant’s rights to accept other card types. If Merchant elects to receive messages from American Express regarding products, services and resources available to it, as indicated on the Merchant Application, Merchant agrees messages maybe sent by American Express to the phone numbers, fax numbers or email addresses provided by Merchant. If a wireless number is provided, Merchant agrees communications may be sent via SMS or text in addition to automated calls. Merchant may opt out of receiving messages by contacting Processor.
(e) EBT Transactions. If Merchant has chosen to accept Electronic Benefits Transfer (“EBT”) transactions, Merchant agrees to issue United States Department of Agriculture, Food and Nutrition Services (“FNS”) food stamp benefits (“FS Benefits”) and/or government delivered cash assistance benefits (“Cash Benefits,” and with FS Benefits, “Benefits”) to recipients (“Recipients”) in in accordance with the procedures specified herein, and in all documentation and user guides provided to Merchant by Processor, as amended from time-to-time; and pursuant to the Quest Operating Rules (the "Quest Rules"), as amended from time-to-time, issued by the National Automated Clearing House Association as approved by the Financial Management Service of the U.S. Treasury Department. Unless otherwise defined herein, all capitalized terms shall have the meanings ascribed them in the Quest Rules. Merchant will provide each recipient a receipt of each Benefit issuance. Merchant will be solely responsible for Merchant’s issuance of Benefits other than in accordance with authorizations. Merchant agrees to comply with all the requirements, laws, rules and regulations pertaining to the delivery of services to Benefit Recipients and Benefit Recipient confidentiality. If Merchant issues FS Benefits under this Merchant Agreement, Merchant represents and warrants to Processor that Merchant is an FNS-authorized "Merchant" (as such term is defined in the Rules) and is not currently suspended or disqualified by FNS. Merchant agrees to secure and maintain at its own expense all necessary licenses, permits, franchises, or other authorities required to lawfully effect the issuance and distribution of Benefits under this Merchant Agreement, including without limitation, any applicable franchise tax certificate and non-governmental contractor’s certificate, and covenants that Merchant will not issue Benefits at any time during which Merchant is not in compliance with the requirements of any applicable law. Merchant agrees to hold Processor harmless from any costs of compliance or failure to comply with any such obligation by Merchant. Processor may terminate or modify the provision of services to Merchant if any of Processor’s agreements with government EBT agencies are terminated for any reason or if any party threatens to terminate services to Processor due to some action or inaction on the part of Merchant. Nothing contained herein shall preclude the State from commencing appropriate administrative or legal action against Merchant or for making any referral for such action to any appropriate Federal, State, or local agency. Any references to "State" herein shall mean the State in which Merchant issues Benefits pursuant hereto. If Merchant issues Benefits in more than one State pursuant hereto, then the reference shall mean each such State severally, not jointly.

3.2 Operating Procedures for Transactions. In accepting Cards for the purchase of Merchant’s goods and services, Merchant shall comply with the requirements of the Merchant Agreement, including but not limited to the Operating Rules, as the same are revised from time to time.

3.3 Submission of Valid Transactions. (a) Merchant will submit to Processor a Transaction only if the Transaction is made or approved by the Cardholder who is issued the Card used for the Transaction. The burden of verifying the identity of the Cardholder and the Cardholder’s authority to initiate a Transaction rests solely with Merchant. Merchant will not submit directly or indirectly: (i) any Transaction that Merchant knows or should have known to be fraudulent or not authorized by the Cardholder; (ii) any Transaction that results from a transaction outside of Merchant’s normal course of business, as described on the Merchant Application; or (iii) any Transaction containing the account of a Card issued to Merchant or any account numbers issued to Merchant’s business owners, family members, principals or employees for Transactions that do not represent a purchase of goods or services from Merchant or a credit transaction related to a purchase of goods or services from Merchant . (b) If at any time the volume of Transactions substantially exceeds or decreases from the projected annual volume stated on the Application, or if at any time Processor suspects fraud, money laundering or violations of the Operating Rules, Processor may, in its sole and absolute discretion and in addition to other remedies that the Processor may have:
(i) refuse to process the excessive or suspect Transactions; (ii) process the Transactions and retain the funds received from processing until such time as the excess or suspect Transactions are found to be valid or invalid and processed in accordance with the Operating Rules; (iii) suspend processing and/or terminate the Agreement; or (iv) amend the Merchant Agreement to protect the interests of Processor.

3.4 Payments to Merchant for Valid Transactions. (a) Member Bank and Processor will provide provisional credit to Merchant for each undisputed and valid Transaction that Merchant submits to Processor by crediting Merchant’s Settlement Account, provided Member Bank and Processor have received settlement for the valid Transaction through the Interchange procedures specified by the Card Association applicable to the Card used for the Transaction (Member Bank and Processor do not provide payment for all Card types for which Authorization services are provided).

Member Bank and Processor are not obligated to provide provisional credit to Merchant for Transactions submitted that are not valid Transactions, and may suspend or discontinue any provisional credit in Member Bank’s and/or Processor’s sole and absolute discretion, including for any reason that would justify termination of this Merchant Agreement. Each provisional credit from Member Bank and Processor to Merchant will be subject to adjustment, including revocation, upon Processor’s further review and verification.

Provisional credit to Merchant for a Transaction disputed by a Cardholder for any reason is not final.
(b) Member Bank and Processor may deduct from any payment to Merchant the amount of any Credit Transaction Receipt processed for Merchant, any Chargeback to Merchant, any amount to be deposited in the Reserve Account and any Processing Fees and amounts sufficient to reimburse Member Bank and Processor for the amount of any Card Association assessments (sometimes referred to as “fines” or “penalties”) or charges due from Merchant or for any current or future obligation of the Merchant that arises under the Merchant Agreement. Merchant must immediately pay Member Bank and Processor the amount by which a Credit Transaction Receipt processed on any day exceeds valid Transactions submitted on that day. Without limiting Member Bank’s and Processor’s remedies, Member Bank and Processor may obtain the amount due by deducting it from the Settlement Account, Reserve Account or other accounts of or funds due Merchant. (c) Merchant acknowledges that all payments and credits provided to Merchant are provisional and subject to suspension, to Chargebacks and to adjustments in accordance with the Merchant Agreement, including, but not limited to the Operating Rules.

3.5 Retrieval Requests. If Merchant deposits Transactions with Processor through magnetic tape, electronic transmission, or electronic data capture terminal, upon the request of a Card Association, Processor or Member Bank, Merchant shall respond to all Retrieval Requests within the time frames specified in the applicable Operating Rules. If Merchant does not respond or responds late to a Retrieval Request, Merchant may be without recourse as Chargebacks for “non receipt of requested item” in most cases, cannot be reversed.

Member Bank and Processor are not obligated to provide provisional credit to Merchant for any Retrieval Request and may suspend or discontinue any provisional credit in their sole and absolute discretion.

3.6 Equipment; Supplies; Displays.

Important Note: Merchant acknowledges and agrees that Member Bank and its affiliates have no duty, obligation or liability whatsoever for: (1) the POS Equipment, herein; (2) any actions or omissions of Processor with respect to the POS Equipment; (3) failure of merchant to perform routine maintenance and updates to the POS Equipment; (4) any failure of merchant to adhere to standard security requirements as it relates to the POS Equipment; or (5) any claims or disputes arising out of the foregoing. (a) At Merchant’s request, Processor will supply Merchant with point-of-sale equipment, including a terminal, router or other compatible or ancillary equipment, hardware or device (collectively “POS Equipment”). Processor will use good faith efforts to program or configure the POS Equipment to operate at the Merchant Outlets in compliance with the Operating Rules; however, Processor makes no representations or warranties that Processor’s programming of the POS Equipment furnished by Processor will operate in compliance with the Operating Rules and applicable law. If Processor supplies Merchant with POS Equipment or other equipment, then Merchant must return such equipment upon termination of this Agreement.
(b) The individual providing the terminal to Merchant is an employee of City Council Processor, unless otherwise identified as an independent sales contractor. Merchant 15 – 19 12/6/2022

acknowledges and understands that POS Equipment may be supplied to Merchant that is the property of Processor and is being provided to Merchant for free use subject to the following conditions and requirements:
(i) Merchant shall be liable for a $495 fee for non-return of Processor supplied POS Equipment if Merchant terminates or ceases processing under the terms of this Agreement before the expiration of the initial or renewal term of this Merchant Agreement and fails to return the POS Equipment within ten days of termination or of ceasing processing.
(ii) Merchant shall be liable for a $450 fee for non-return of Encryption Exchange POS Equipment if applicable;
(iii) Merchant will be liable for any damages to the POS Equipment from the misuse or negligent use or handling of the POS Equipment; (iv) Merchant will be liable for any reasonable monthly fee as determined by Processor for paper or other supplies provided by Processor for use with the POS Equipment; and
(v) Processor, at its absolute and sole discretion, may allow for one terminal exchange at no charge, but may charge additional fees for subsequent exchanges. (c) All Processor and third party POS Equipment and services provided or procured by Processor under this Merchant Agreement are provided “AS-IS.” Processor makes no warranty as to this POS Equipment’s fitness for any particular purpose (or any other Warranty) and disclaims any liability resulting from the POS Equipment or Merchant’s use of the POS Equipment.
(d) Merchant acknowledges that Processor or a third party is supplying the POS Equipment and that Member Bank shall have no responsibility or liability for the POS Equipment supplied to Merchant.
(e) Merchant will use only the forms for Transactions and electronic processing formats provided or approved in advance by Processor. Processor may change the forms from time to time, and, upon notification, Merchant will comply with any changes. Merchant will use Transaction forms or materials provided by Processor only for Transactions which Merchant submits to Processor.
(f) Merchant may not (i) indicate or imply that the Card Associations, Processor or Member Bank endorses any Merchant goods or services, (ii) refer to a Card Association, Processor or Member Bank in stating eligibility for Merchant’s products, services or membership, or (iii) use any marks, symbols or logos owned by any Card Association, Processor or Member Bank for any purpose other than those permitted in the Operating Rules, provided that any use of Processor’s or Member Bank’s marks, symbols or logos shall be in accordance with and subject to any branding guidelines provided by Processor and Member Bank. Merchant acknowledges that Member Bank and Processor shall remain the sole and exclusive owners of their respective intellectual property and Confidential Information (defined below). Except to the extent expressly provided herein, no rights to Processor’s or Member Bank’s intellectual property or Confidential Information are granted hereunder, and all rights therein are expressly reserved.

3.7 Europay/Mastercard/Visa (“EMV”) Chip Card Compliance. Merchant agrees that if Merchant does not use POS Equipment that has been certified EMV chip card compliant and enabled or when a lost or stolen chip and PIN card is used at an EMV enabled terminal capable of processing chip and signature only, Merchant may be liable for payment of any transactions submitted for chargeback by the applicable EMV chip card issuer(s).

4. MERCHANT’S WARRANTIES. Upon signing the Merchant Application, and each time Merchant submits a Transaction, Merchant represents and warrants that:

4.1 Merchant has abided by the Merchant Agreement, and all applicable laws , the Operating Rules;

4.2 Each statement made on the Merchant Application was true as of the date Merchant signed the Merchant Application agreeing to be bound by the Merchant Agreement;

4.3 There have been no materially adverse changes in information provided in the Merchant Application or in Merchant’s financial condition, or management;

4.4 Merchant does not do business under a trade name or style not previously disclosed in writing, and there has been no change in the nature of Merchant’s business or the product lines that Merchant sells not previously disclosed;

4.5 The Transaction is genuine and arises from a bona fide sale of merchandise or services by Merchant, represents a valid obligation for the amount shown on the Transaction Receipt and does not involve the use of the Card for any other purpose;

4.6 Merchant has title to the Transaction and Transaction Receipt, there are no liens or other encumbrances on it, and Merchant has the authority to convey the Transaction for processing;

4.7 The Transaction is not subject to any dispute, set-off or counterclaim;

4.8 The Transaction has not been previously presented for processing unless allowed by the Operating Rules;

4.9 Each statement on the Transaction Receipt is true, and Merchant has no knowledge of facts that would impair the validity or collectability of the amount of the Transaction;

4.10 The person who executes the Merchant Application on behalf of Merchant has the full power and authority to execute the Merchant Application and to enter into the Merchant Agreement;

4.11 The Merchant Agreement is the legal, valid, and binding obligation of Merchant enforceable against Merchant in accordance with its terms;

4.12 Merchant shall submit Transactions only in accordance with the information contained in the Merchant Application and the Merchant Agreement;

4.13 Merchant has the power and authority to authorize the automatic funds transfer provided for in the Merchant Agreement;

4.14 The Settlement Account is owned and controlled by Merchant and is a valid account for processing debit and credit transactions under the Merchant Agreement;

4.15 Merchant is not (i) a Sanctioned Person, (ii) located in or operating under a license issued by a jurisdiction whose government has been identified by the U.S. Department of State as a sponsor of international terrorism under 22 U.S.C. 2371 or 50 U.S.C. App. 2405(j), (iii) located in or operating under a license issued by a jurisdiction that has been designated as non-cooperative with international anti-money laundering principles or procedures by an intergovernmental group or organization of which the U.S. is a member, or (iv) located in or operating under a license issued by a jurisdiction that has been designated by the U.S.

Secretary of Treasury pursuant to 31 U.S.C. 5318A as warranting special measures due to money laundering concerns; and

4.16 Merchant will immediately notify Member Bank and Processor in writing of any material changes to any information provided herein including but not limited to a change in Merchant’s legal entity, location, business type, or the types of goods and services offered for sale by Merchant.

5. CONFIDENTIALITY; DATA SECURITY.

5.1 Confidentiality. Merchant will treat as confidential: (i) the terms of the Merchant Agreement; (ii) all information or data, of whatever nature, relating to Processor (including its operations, policies, procedures, accounts and personnel) accessed or used by or disclosed to Merchant in connection with the Merchant Agreement; (iii) Processor’s IRS W-9 form; and (iv) all information or data that is proprietary to a third party (including Processor’s customers and contractors) and that Processor is obligated to treat as confidential, accessed or used by or disclosed to Merchant in connection with the Merchant Agreement (individually and collectively, “Confidential Information”). Merchant shall not use or disclose Confidential Information without Processor’s prior written consent. Merchant may only disclose Confidential Information to Merchant employees who have a need to know such information in connection with Merchant’s performance hereunder and who are bound to confidentiality restrictions no less restrictive than those herein. Merchant shall exercise at least the same degree of care to maintain the confidentiality of Confidential Information that it uses for its own similar information, but in no event less than a reasonable degree of care. The foregoing obligations shall not apply to any information that (x) is received from any third party source that is properly authorized to disclose it without restriction, (y) is or becomes generally known to the public by publication or some other means other than a breach by Merchant or its employees of any agreement or confidentiality obligations, or (z) is required by law to be divulged, provided that the request is proper and the disclosure does not exceed that which is required. In the case of (z), Merchant will provide prior notice thereof and cooperate with Processor to limit disclosure. Upon Processor’s request, and upon termination or expiration of the Merchant Agreement, Merchant shall return or, only if requested by Processor, destroy all Confidential Information in its possession or control.

Merchant acknowledges that a breach of this Section 5 may cause Processor irreparable injury and that Processor may have no adequate remedy at law. Accordingly, Processor may seek provisional or injunctive relief in addition to any other rights or remedies.

5.2 Transaction Receipts. Merchant will retain in a secure and confidential manner original or complete and legible copies of each Transaction Receipt, and each Credit Transaction Receipt required to be provided to Cardholders, for such period as required by law or the Operating Rules. Merchant shall render all materials containing Cardholder Account Numbers unreadable prior to discarding. Merchant is responsible for ascertaining whether applicable law requires copies retained by Merchant to truncate card numbers and suppress expiration dates, and for complying with all such laws.

5.3 Storage. Merchant will store Transaction Receipts and Credit Transaction Receipts in an area limited to selected and authorized personnel, and when record-retention requirements have been met, Merchant will destroy the records so that the same are rendered unreadable.

5.4 Merchant Servicers and Agents. Merchant must notify Processor and receive Processor’s approval prior to engaging any Merchant Servicer or Agent in connection with Merchant’s acceptance of Cards or the submission of Transactions to Processor. Merchant shall provide Member Bank and Processor at least sixty days advance written notice of Merchant’s election to use a Merchant Servicer or Agent. Member Bank and/or Processor may individually approve or deny the use of a Merchant Servicer or Agent in their sole and absolute discretion and at any time. If a Merchant Servicer or Agent is required to certify, register, or act in any fashion pursuant to the Operating Rules, Merchant shall cause such Merchant Servicer or Agent to cooperate with Processor in completing any steps required for registration and/or certification and/or action. Merchant is solely responsible for any and all applicable fees, costs, expenses and liabilities associated with such registration and/or certification and/or action. Processor and Member Bank shall in no event be liable to Merchant or any third party for any actions or inactions of any Merchant Servicer or Agent used by Merchant, and Merchant hereby expressly assumes all such liability.

Merchant will immediately notify Processor if Merchant decides to use electronic authorization or data capture terminals provided by any entity other than Processor or its authorized designee (“Third Party Terminals”) to process Transactions, including leasing a terminal from a third party. If Merchant elects to use Third Party Terminals: (a) the third party providing the terminals will be Merchant’s Merchant Servicer in the delivery of Transactions to Processor; and (b) Merchant assumes full responsibility and liability for any failure of that third party to comply with the Operating Rules, applicable laws, rules or regulations or the Merchant Agreement. Processor and Member Bank will not be responsible for any losses or additional fees incurred by Merchant as a result of any error by a third party agent or a malfunction in a Third Party Terminal.

City Council 15 – 20 12/6/2022

The use of a Merchant Servicer or Agent or software or systems provided by a Merchant Servicer or Agent that has connectivity to the Internet poses an increased risk, and Merchant assumes all liability for such increased risks. If Merchant utilizes software or hardware with a connection to the Internet such hardware or software interacts in any capacity with the provision of services contemplated pursuant to this Merchant Agreement, Merchant is solely liable without limitation for any and all consequences of such interaction.

5.5 Security. Merchant agrees and shall ensure that Merchant Servicers and Agents utilized by Merchant provide the same levels of security as those required of Merchant, and that such Merchant Servicers and Agents transmit data in accordance with: (a) the required format(s) of the Card Associations; (b) the Operating Rules; and (c) the requirements of Processor and Member Bank. Merchant must have a written contract between Merchant and its Agent or between Merchant and the Merchant Servicer that stipulates adherence to the provisions of such information security requirements. Merchant’s written contract with any such third party must contain provisions obligating the third party to comply with applicable law, with CISP and SDP and DISC and PCIDSS, PA-DSS, PIN and PED security requirements if applicable, and all other Card Association requirements pertaining to confidentiality and security and integrity of Cardholder and Card transaction data, with all rules prohibiting storage of certain Card transaction data, and with all other applicable Operating Rules and the requirements of Processor and Member Bank. Merchant will only allow Merchant Servicers or Agents to have access to cardholder data for the purposes that are authorized by the Operating Rules. Any fees or liability assessments from actual or alleged noncompliance will be the sole liability of the Merchant. Merchants processing less than 1 million annual Visa transactions and using third parties for POS application, terminal installation and integration must engage Payment Card Industry (PCI) Qualified Integrator Reseller (QIR) professionals to install, integrate, and support point-of-sale applications and terminal installation and integration. Merchant shall indemnify and hold Member Bank and Processor harmless against losses or damages arising from the acts or omissions of Merchant Servicers or Agents engaged by Merchant.

5.6 Loss or Theft. Merchant must immediately notify Member Bank and Processor of any suspected or confirmed loss or theft of materials or records that contain Cardholder Account Numbers or Card Transaction information. In the event of a suspected or confirmed loss or theft Merchant shall provide immediate access to all facilities, systems, procedures, equipment, and documents as may be deemed appropriate by Processor and Member Bank or their designated representatives, regulators or auditors for inspection, audit, and copying as deemed appropriate by both Member Bank and Processor in their individual sole discretion. Merchant shall be responsible for all costs associated with such inspection, audit, and copying however such costs may occur.

5.7 Merchant authorizes Processor to release its name and address to any third party whom the Processor determines needs to know such information in order for Processor to perform the Card Program services under this Merchant Agreement and who has requested such information.

5.8 Merchant will not: (a) provide Cardholder Account Numbers, personal Cardholder information or Transaction information to anyone except Processor, the Card Associations, or Merchant’s Merchant Servicers or Agents for the purpose of assisting Merchant in completing Card Transactions, or as specifically required by law; (b) retain or store Card Magnetic Stripe, CVV, CVV2, CVC2 or CID data (including Track Data) subsequent to Authorization for a Transaction; (c) sell, purchase, provide or exchange Card Account Number information to any third party without the Cardholder’s consent, or to any entity other than Merchant’s Merchant Servicers or Agents, Processor, the Card Associations, or in response to valid legal process or subpoena; or (d) release any Cardholder information over the telephone under any circumstances.

5.9 Merchant may not in any event, including its failure, including bankruptcy, insolvency, or other suspension of business operations, sell, transfer, or disclose any materials that contain Cardholder Account Numbers, personal information or Transaction information to third parties. In the event that Merchant’s business fails or ceases to exist, Merchant is required to return to Processor all such information or provide proof of destruction of this information to Processor.

5.10 Merchant agrees to establish security procedures to protect Cardholder information and comply with the Visa Cardholder Information Security Program (CISP), Mastercard’s Site Data Protection (SDP) Program, Discover Information Security Compliance (DISC), American Express Data Security Requirements, the Payment Card Industry (PCI) Data Security Standards, and applicable laws pertaining to the privacy and security of personal information (including, without limitation, and to the extent applicable, those of non-U.S. governmental authorities). Detailed information about PCI DSS can be found at the PCI DSS Council’s Website: www.pcisecuritystandards.org. The Card Associations, Processor or Member Bank, and their respective representatives, may inspect the premises of Merchant or any Merchant Servicer or Agent engaged by Merchant for compliance with security requirements. Merchant acknowledges that any failure to comply with security requirements may result in the imposition of restrictions on Merchant or the permanent prohibition of Merchant’s participation in Card acceptance programs by the Card Associations. Merchant shall indemnify and hold Processor and Member Bank harmless against any losses or damages arising from Merchant's actual or alleged failure to comply with security procedures and any losses or damages arising from or related to Merchant's acts or omissions that result in an actual or alleged breach of data security, including but not limited to Merchant's nonparticipation in any breach security program Processor may offer.

5.11 Processor acknowledges that it will maintain compliance with all applicable PCI DSS requirements.

5.12 Federal regulations enacted pursuant to the USA PATRIOT Act and other applicable laws require financial institutions with which Processor has relationships to verify the identity of every person who seeks to open an account with a financial institution. As a result of Merchant’s status as an account holder with Member Bank, Merchant shall provide documentary verification of Merchant’s identity, such as a driver’s license or passport for an individual and certified copy of organization documents for an entity in manner acceptable to Processor and Member Bank. Processor and Member Bank reserve the right to verify Merchant’s identity through other non-documentary methods as Processor and Member Bank deems appropriate in its sole discretion. Processor and Member Bank may retain a copy of any document it obtains to verify Merchant’s identity with the financial institution.

6. OPERATING RULES.

6.1 Merchant must comply with the Operating Rules, as the same may be amended from time to time. The Operating Rules may change with little or no advance notice to Merchant and Merchant will be bound by all such changes. If Merchant objects to any change in the Operating Rules, it must immediately stop accepting new Transactions for Cards governed by the change. The Operating Rules will govern in the event that there is any inconsistency between the Merchant Agreement and the Operating Rules. However, nothing in the Merchant Agreement shall be construed to impose on Merchant a requirement (including a requirement under the Operating Rules) which is prohibited by mandatory provisions of applicable law (i.e., where the applicability of such provisions of law to the Merchant Agreement, and of the law’s prohibition to the particular requirement which otherwise would be imposed on Merchant hereunder, cannot lawfully be waived by agreement), but the requirement hereunder shall be construed to continue in effect and to be imposed on Merchant in all respects and at all times to the fullest extent possible without violating the law’s prohibition, with only those particular applications of the requirement which would violate the law’s prohibition deemed severed from the provisions hereof.

6.2 Operating Rules of the Debit Networks may differ among them with respect to the Transactions they allow. Processor, at its discretion, may require that the most restrictive requirements of one Debit Network apply to all of Merchant’s On-line Debit Card Transactions, regardless of Card type.

7. MERCHANT’S BUSINESS; OTHER PROCESSORS.

7.1 Compliance With Laws. Merchant will comply with all applicable federal, state, and local laws and regulations (“Requirements of Law”), including but not limited to laws and regulations regarding anti-money laundering compliance, in completing Transactions, submitting them to Processor, performing its obligations under the Merchant Agreement, and otherwise conducting its business.

7.2 Change in Name or Business. Merchant will give Member Bank and Processor at least thirty days’ prior written notice before any change in Merchant’s name or location, any change in ownership or management of Merchant’s business, any sale, assignment, rental, lease or transfer of ownership of any location that accepts Cards, or any material change in information concerning Merchant in the Merchant Application, and material change in the type or nature of the business carried out by Merchant or otherwise required to be provided to Processor.

7.3 Other Processors. To the extent permitted by applicable law, Merchant agrees that it will not participate in a Card Program with another financial institution or processor without Processor’s written approval.

8. CREDIT REPORTS AND OTHER INFORMATION.

8.1 Reports About Merchant. From time to time, Processor may obtain credit and other information on Merchant, owners and officers of Merchant, any and all personal guarantors of Merchant, and any signatory to the Merchant Application, from others (such as customers and suppliers of Merchant, lenders and credit reporting agencies), and furnish information on Merchant’s relationship with Processor and Processor’s experience with Merchant to others seeking the information.

8.2 Reports from Merchant. Merchant will provide Processor with updated business and financial information concerning Merchant, including financial statements, tax returns, evidence of required licenses and other information and documents Processor may reasonably request from time to time. Merchant shall further provide Processor such information as it may request for the making of insurance claim, regulatory or other filings related to Merchant’s activity pursuant to this Agreement. All material marked “confidential” which Processor receives from Merchant will be used only by Processor, Member Bank or Card Association in performing the Card Program services under this Merchant Agreement or related services and reporting. Processor, Member Bank and any Card Association, regulator, auditor or any other entity having authority may audit Merchant’s records relating to this Merchant Agreement. Merchant shall provide all documentation, information or other inspection rights requested by Processor’s or Member Bank’s regulators or auditors or otherwise to enable Processor and Member Bank to meet Requirements of Law. Without limiting the generality of the foregoing, Merchant understands and agrees that if, at the time of signing this Merchant Agreement Merchant is undergoing a forensic investigation, Merchant must notify Processor and fully cooperate with the investigation until it is completed.

8.3 Information. Merchant authorizes Processor to release and use information collected in connection with Processor’s provision of services to the Merchant contemplated in the Merchant Agreement, to third parties that provide services to Processor or Merchant, for marketing purposes with third parties with whom Processor has a relationship to offer products and/or services to merchants, or to any third party that requests and has a reason to know such information, including but not limited to the Card Associations, and any third party having regulatory control over any party.

9. ASSIGNMENT; BANKRUPTCY.

9.1 Assignment. The Merchant Agreement is binding upon the successors and assigns of Processor, Member Bank and Merchant. Merchant will not assign or transfer (including by merger, change of control or operation of law) the Merchant Agreement (in whole or in part) to another person or entity without Processor and Member Bank’s prior written consent City Council 15 – 21 12/6/2022

and any purported assignment made without Processor’s and Member Bank’s consent will be void.

9.2 Bankruptcy.
(a) Merchant will notify Processor immediately if any bankruptcy, insolvency or similar petition is filed by or against Merchant. Merchant acknowledges that this Merchant Agreement constitutes an executory contract to extend financial accommodations as defined in 11 U.S.C. §365(c)(2) and that the Merchant Agreement cannot be assumed or assigned in the event of bankruptcy. Merchant and Processor agree that in the event of Merchant’s bankruptcy, Processor shall be entitled to suspend further performance under this Merchant Agreement.
(b) Merchant acknowledges and agrees that in the event of a bankruptcy proceeding, Merchant must establish a Reserve Account or maintain a previously established and then current Reserve Account in amounts required by Processor and in accordance with any Reserve Account provision specified in this Merchant Agreement. Processor will have the right to setoff against the Reserve Account for any and all obligations which Merchant may owe Processor, without regard as to whether the obligations relate to Transactions initiated or created before or after the filing of the bankruptcy petition.

10. AMENDMENTS; WAIVERS.

10.1 Amendments. Bank shall have the right to modify or amend the terms and conditions of this Merchant Agreement, including, without limitation, the right to modify, amend, or supplement applicable fees, charges, and/or discounts. Modifications and amendments related to changes to the Operating Rules, changes to the fees charged by the Card Associations, Member Bank, or third parties, or in response to changes in Requirements of Law (collectively, a “Third Party Change”) may be made effective immediately, with or without notice. Modifications or amendments unrelated to a Third Party Change shall be effective upon the date specified in a notice to the Merchant (the “Change Notice”), provided that the date shall not be fewer than five business days after the date of such Change Notice.

A Change Notice may be reflected as a message attached to Merchant’s monthly billing statements. Following the Effective Date, in the event of any modification or amendment not related to a Third Party Change, Merchant shall have the right to terminate this Merchant Agreement, without liability for premature termination pursuant to Section 11.2(d), by providing written notice thereof to Processor, provided that such notice must be given within five business days following the date of the Change Notice. Other than the amendments set forth above, this Merchant Agreement may be amended only in writing signed by Merchant, Member Bank, and Processor.

10.2 Waivers. Bank’s failure to enforce this Merchant Agreement will not waive Bank’s rights under this Merchant Agreement. Waivers of any provision of this Merchant Agreement must be in writing and signed by Bank. A waiver in one instance will not apply to other occasions unless that intent is clear from the signed waiver. 11. TERM; TERMINATION.

11.1 Term/Renewal. The initial term of this Merchant Agreement shall be for the term of three years (the “Initial Term”) commencing on the earlier date of the presentation of the first Transaction, including any test Transaction, by Merchant to Bank or the date Bank approves the Merchant Application; provided, however, that if Merchant is receiving these terms and conditions as an amendment to an existing Merchant Agreement, the amendment shall not affect the then-existing term. By either Merchant’s signature on the Merchant Application or Merchant’s processing a Transaction with Bank, Merchant confirms acceptance of the Merchant Agreement. At the expiration of the Initial Term, this Merchant Agreement will automatically renew for successive one year periods (each a “Renewal Term” and collectively with the Initial Term the “Term”) unless a party provides the other parties with notice of its intent not to renew the Merchant Agreement at least ninety days prior to the expiration of the then current term.

11.2 Termination.
(a) Termination without Cause. Member Bank or Processor or Member Bank’s or Processor’s designated representative may terminate the Merchant Agreement as to all Card types or individually specified Card types, without cause, upon thirty days advance written notice.
(b) Termination for Cause by Processor or Member Bank. Member Bank or Processor or Member Bank’s or Processor’s designated representative may terminate the Merchant Agreement in its sole and absolute discretion, effective immediately, upon written, electronic or oral notice, to Merchant if Member Bank or Processor reasonably determines that any of the following conditions exists:
(i) Merchant has violated any provision of the Merchant Agreement. (ii) There is a material adverse change in Merchant’s financial condition, material change in Merchant’s processing activity, processing activity inconsistent with the Merchant Application, or Member Bank or Processor determines in its sole discretion that Merchant’s processing activity could result in a loss to Processor or Merchant Bank. (iii) A petition in bankruptcy has been filed by or against Merchant, Merchant is generally unable to pay its debts as they become due, a receiver, custodian, trustee, liquidator or similar official is appointed for a substantial portion of Merchant’s business, there is a general assignment for the benefit creditors, or the business terminates. (iv) Any information which Merchant provided to Processor or Merchant Bank, including Merchant Application information, was false, incomplete or misleading when received, or has materially changed since Merchant provided such information. (v) At any time during the term of the Merchant Agreement, Merchant has had a monthly ratio of Chargebacks to Transactions that Processor or Member Bank, in their sole and absolute discretion, deems excessive.
(vi) There is an overdraft for three days or more in the Settlement Account, or overdrafts in the Settlement Account are otherwise excessive. (vii) Merchant or any of Merchant’s officers or employees has been involved in processing Transactions with Processor or Member Bank or other parties arising from fraudulent or otherwise unauthorized transactions. (viii) Merchant is or will be unable or unwilling to perform its obligations under the Merchant Agreement or any applicable laws.
(ix) Merchant has failed to pay Processor or Member Bank any amount when due.
(x) Merchant has failed to promptly perform or discharge any obligation under the Merchant Agreement, the Settlement Account or the Reserve Account. (xi) Any of Merchant’s representations or warranties made in connection with the Merchant Agreement was not true or accurate when given. (xii) Merchant has defaulted on any agreement it has with Processor or Member Bank.
(xiii) Processor or Member Bank is served with legal demand, order or process seeking to attach or garnish any of the provisional credits arising out of or relating to the Merchant Agreement, Merchant’s funds or property in Processor’s or Member Bank’s possession,
(xiv) The Operating Rules are amended in any way such that Processor or Member Bank determines that the continued existence of the Merchant Agreement would cause Processor or Member Bank to be in breach of such Operating Rules. (xv) Any Guaranty supporting Merchant’s obligations is revoked, withdrawn or terminated or altered in any way.
(xvi) Any governmental entity initiates proceedings against, or an investigation regarding, Merchant, or Processor or Member Bank reasonably believes that a governmental entity may do so.
(xvii) If any circumstances arise regarding Merchant or its business that, in Processor’s or Member Bank’s discretion, make harm or loss of goodwill to Processor, Member Bank or any Card Association likely.
(c) Termination for Cause by Merchant. Merchant may terminate the Merchant Agreement in the event of a material breach of the terms of the Merchant Agreement by Processor, provided Merchant gives Processor written notice of any alleged breach and such breach remains uncured for a period of thirty days following receipt of written notice by the Processor.
(d) Damages for Early Termination.
(i) Processor and Merchant acknowledge and agree that in addition to all other remedies available to Processor under the Merchant Agreement or as otherwise available in law or equity, if the Merchant Agreement is terminated prior to the expiration of the applicable Term of the Merchant Agreement for any reason other than for a material, uncured breach by Processor, Merchant agrees to pay Processor damages (the “Damages”) determined by adding an account closure fee as follows (unless a different amount is disclosed on the Merchant Application): (1) $250 for Merchants with less than twelve months remaining from the date of termination to the end of the then current Term, or; (2) $500 for Merchants with more than twelve months remaining, or such portion of the foregoing as may be permitted by applicable law.
(ii) Merchant agrees that such Damages shall also be due to Processor if Merchant discontinues submitting Transactions for processing during the Term for a period of ninety (90) consecutive days, and is not designated on the Merchant Application, or by notice to Processor, as a seasonal merchant or as otherwise agreed to by Processor. (iii) Merchant acknowledges and agrees that the Damages are not a penalty but rather are a reasonable computation of the financial harm caused by the termination of the Merchant Agreement or the cessation of processing activity by Merchant. (e) Member Bank’s or Processor’s rights of termination under the Merchant Agreement are cumulative. A specific right of termination shall not limit any other right of Processor or Member Bank to terminate the Merchant Agreement expressed elsewhere in the Merchant Agreement. Notice of termination may be given orally or in writing, if given orally, shall be confirmed in writing, except as otherwise stated in the Merchant Agreement. (f) Upon termination, Merchant’s rights to complete Transactions and submit them to Processor, and to use Transaction form or formats, promotional material and any other items provided by Processor, will cease. Termination of the Merchant Agreement will not terminate the rights and obligations of Merchant, Processor and Member Bank relating to acts or omissions occurring before termination, including for example, any Processing Fees or other service fees owed to Processor, any Transactions processed for Merchant by Processor (whether before or after termination), Merchant’s Chargeback and indemnity obligations, and the Security Interest granted to Processor and Member Bank in the Merchant Agreement.
(g) It is understood that a file for terminated merchants referred to as Member Alert to Control High-Risk Merchants (“MATCH”), formerly known as the Terminated Merchant File (“TMF”), is managed and maintained by Mastercard and utilized by the Card Associations and acquiring banks to identify the names of any business (and its principals) that have been terminated for certain reasons, including fraud, depositing excessive counterfeit paper, excessive unauthorized transactions, excessive chargebacks, depositing paper for others (laundering), bankruptcy or breach of a Merchant Agreement. Merchant acknowledges that Member Bank or Processor is required to report Merchant to the MATCH (and/or on the Consortium Merchant Negative File (the CMNF) published by Discover® Network) if the Merchant Agreement is terminated for any of the foregoing reasons or other reasons as may be modified by the Card Associations. Merchant agrees and consents to such reporting in the event of the termination of the Merchant Agreement for any of the foregoing reasons, and Processor and Member Bank shall have no liability for such reporting, even in City Council 15 – 22 12/6/2022

instances where Merchant contends that the foregoing bases for termination do not, in fact, exist.
(h) Sections 2.3, 3, 4, 5, 6, 7, 8.1, 9.1, 10.2, 11, 12, 13, 14, 15, 16.3, 16.4 17, 18, 19, 20, 22, 23, 24, and 25 will survive termination of the Merchant Agreement.

12. SETTLEMENT ACCOUNT.

12.1 Settlement Account Required. Merchant must maintain a Settlement Account in Merchant’s name in satisfactory condition at a depository institution under arrangements acceptable to Processor. The Settlement Account will be subject to the provisions of Section 14 of this Merchant Agreement.

12.2 Minimum Balance. Merchant agrees to maintain a minimum balance of funds in the Settlement Account as Processor may specify to Merchant in writing from time to time.

12.3 Provisional Credits. Subject to the terms and conditions of the Merchant Agreement, Processor and Member Bank agree to provisionally credit Merchant for each Transaction that Processor accepts from Merchant. Merchant acknowledges that Processor and Member Bank may reverse or revoke such credit, including in response to any Chargeback. Furthermore, Merchant agrees that Processor and Member Bank may charge or debit the Settlement Account for the amount of any Transaction processed under the Merchant Agreement, or any agreement Processor or Member Bank may have with any Merchant Affiliate, that results in a Chargeback, or for any Credit Transaction Receipt or other reimbursement or Processing Fees or other Merchant obligation to which Processor or Member Bank may be entitled under the Merchant Agreement.

12.4 Audits and Adjustments. Merchant agrees that Processor and Member Bank may audit all Transaction calculations and that Processor and Member Bank shall have the right, without notice, to make withdrawals, deposits, or other adjustments to or from the Settlement Account for any deficiencies or overages.

12.5 Errors and Disputes. Processor and Member Bank shall be entitled to presume that any amounts the Processor and Member Bank pays to or debits from Merchant are correct unless Merchant disputes these by sending Processor written notice within thirty days of the date of the applicable statement containing any disputed payments or debits.

PROCESSOR AND MEMBER BANK SHALL NOT BE LIABLE FOR ANY DISPUTED

PAYMENTS OR DEBITS, INCLUDING ANY ALLEGEDLY IMPROPER FEE(S),

UNDERPAYMENTS, OR BILLING ERRORS, WHICH ARE NOT REPORTED TO PROCESSOR IN WRITING WITHIN SUCH THIRTY-DAY PERIOD.

12.6 POS Equipment. If Merchant chooses to rent or lease POS Equipment from Processor or utilizes software provided by Processor for use in processing Transactions, Merchant agrees to pay Processor: (a) a pre-determined monthly rental fee; (b) any initial upfront costs as required; and (c) all applicable taxes for such POS Equipment or software utilization.

12.7 Settlement Account Closure. If the Settlement Account is closed, Processor or its designated representative may terminate the Merchant Agreement, effective immediately, upon written or oral notice (with written confirmation in the event of oral notice) unless Merchant opens another Settlement Account acceptable to Processor. Merchant may change the Settlement Account upon prior written approval by Processor, which approval will not be unreasonably withheld.

12.8 ACH Authorization. Merchant authorizes Processor and Member Bank or their agents or designated representatives to initiate debit and credit entries and adjustments to the Settlement Account or the Reserve Account (described in Section 13 of the MPA) through the ACH settlement process for amounts due under the Merchant Agreement. This authorization will remain in full force and effect until termination of the Merchant Agreement and the full and final payment of all obligations of Merchant due under the Merchant Agreement. Merchant acknowledges and agrees that Processor and Member Bank will not be liable for any delays in receipt of funds, any failure by Merchant to receive funds, or errors in debit or credit entries caused by Merchant, or third parties, including but not limited to any Card Association or any financial institution.

13. ADDITIONAL COLLATERAL SECURITY; RESERVE ACCOUNT.

As a condition for providing Card Program services, Merchant may, at Processor’s discretion, be required to provide additional collateral security for Merchant’s obligations hereunder, which additional collateral security shall be of a kind, and in amounts, satisfactory to Processor in Processor’s sole discretion, and which shall be in addition to all other collateral provided for in Section 14 hereof. Processor may require that all or any part of the additional collateral be deposited in a Reserve Account, in which case the following provisions of this Section 13 shall apply:

13.1 Reserve During Term of Merchant Agreement.
(a) Merchant may be required to deposit, or Processor or Member Bank may deposit by deducting from any provisional credit or payment otherwise due to Merchant or from any funds in the Settlement Account or any other deposit account of Merchant, into an account maintained by Member Bank (or at another approved depository institution) (the “Reserve Account”), initially or at any time in the future as requested by Processor, sums sufficient to satisfy Merchant’s current and/or future obligations as determined by Processor in its sole and absolute discretion. In lieu of establishing a Reserve Account, Processor may, at its election, demand and receive other forms of additional collateral security, including, without limitation, letters of credit or certificates of deposit. Failure to supply such additional collateral security shall constitute a material breach of this Merchant Agreement. (b) The Reserve Account will be separate from the Settlement Account.

Notwithstanding anything else in this Merchant Agreement to the contrary, Merchant shall have no ownership interest or property rights in the Reserve Account or the funds therein, no right of withdrawal from the Reserve Account, and no right to receive interest on funds held in the Reserve Account. Rather, the Reserve Account shall be under the sole control of Member Bank. Any and all earnings from deposits of Merchant to the Reserve Account shall be the sole property of the Processor.

13.2 Reserve Account Deposits.
(a) At any time in Processor’s sole and absolute discretion, Processor may (i) designate the minimum balance required to be deposited in the Reserve Account, (ii) require that the amount on deposit in the Reserve Account be increased, (iii) require that Merchant deposit, or Processor or Member Bank may deposit for Merchant into the Reserve Account a percentage of, or a fixed amount from each Transaction processed, or (iv) otherwise determine the amount to be deposited in the Reserve Account. Processor at its sole and absolute discretion may require that each month Merchant deposit, or Processor or Member Bank may deposit by deducting from any provisional credit or payment due to Merchant or from any funds in the Settlement Account or any other deposit account of Merchant sums into the Reserve Account no later than the twentieth day of the month. Processor shall notify Merchant as to the amount of the funds to be deposited each month. (b) Merchant acknowledges and agrees that the Reserve Account may contain both funds deposited by Merchant and funds of other merchants of the Processor.

13.3 Deductions from Reserve Account. If funds are not available in the Settlement Account, Processor or Member Bank without prior notice to Merchant may deduct from any provisional credits or payment due to Merchant that are maintained in the Reserve Account any current or future obligation of Merchant to Processor or Member Bank under the Merchant Agreement, including all Processing Fees, Chargebacks, Credit Transaction Receipts, Damages, and any and all additional fees and obligations under the terms of the Merchant Agreement, and sums sufficient to reimburse Processor and Member Bank for the amount of any liability assessments and charges due the Card Associations.

13.4 Replenishment of Reserve Account Deficiencies. Whenever the balance in the Reserve Account is less than the minimum balance required, or is otherwise deficient, Processor or Member Bank may, without prior notice, deposit the deficiency into the Reserve Account by reducing any payment to Merchant required by the Merchant Agreement or deduct the deficiency from the Merchant’s or Merchant’s Affiliate’s Settlement Account or any other deposit account of Merchant or Merchant Affiliate with another depository institution (including accounts of general partners if Merchant is a partnership) and deposit it into the Reserve Account. Merchant authorizes deductions from its accounts by ACH entry, sight draft, preauthorized check, reverse wire, or otherwise as Processor and Member Bank deem appropriate under the circumstances. In addition, Merchant will deposit any deficiency into the Reserve Account within one Business Day after receiving Processor’s oral or written request. Without limiting Processor’s remedies, Merchant’s failure to deposit any deficiency on time will permit Processor, without advance notice, to suspend or cease processing additional Transaction Receipts and Credit Transaction Receipts. Processor will give Merchant written notice of any suspension or cessation of processing.

13.5 Additions to Reserve Account. If Processor has reason to believe that Merchant may be liable to customers or to Processor for Chargebacks exceeding the balance in the Reserve Account, Processor or Member Bank may: (a) immediately place in the Reserve Account provisional credits or payments otherwise due to Merchant and/or stop processing transactions for Merchant until such time as the extent of Merchant’s obligations to Processor and Member Bank, or Merchant’s liability for Chargebacks, or Merchant’s liability to customers are known, and Processor no longer deems itself insecure, and/or (b) demand from Merchant an amount that in Processor’s judgment is needed to ensure payment of Merchant’s obligations and liabilities. Merchant’s failure to pay any amount will permit Member Bank or Processor or its designated representative to terminate the Merchant Agreement immediately without advance notice.

13.6 Reserve Account After Merchant Agreement Terminates. Processor or Member Bank may continue to hold or deposit funds in the Reserve Account after termination of the Merchant Agreement, regardless of whether termination is by Merchant, Processor or Member Bank. Upon termination of the Merchant Agreement by Merchant, Processor or Member Bank, Processor and Member Bank may retain sufficient funds to satisfy any and all Processing Fees, Chargebacks, Credit Transaction Receipts, Damages, and any and all additional fees, and sums sufficient to reimburse Processor and Member Bank for the amount of any liability assessments and charges due the Card Associations or other obligations or liabilities arising or, in Processor’s or Member Bank’s discretion, likely to arise under the terms of the Merchant Agreement. If no funds have been deposited into the Reserve Account before termination, Processor, at Processor’s option, may notify Merchant to deposit funds into the Reserve Account upon termination of the Merchant Agreement. All provisions which apply to a pre-termination Reserve Account will apply after termination, including replenishment of deficiencies. The funds will be held by Processor and Member Bank or its designated agent for a period of not less than one hundred eighty days from the date of the last Transaction, including, but not limited to a Chargeback, processed under the Merchant Agreement, plus the period of any warranty, guarantee, and/or return policy on goods and/or services sold. Processor and Member Bank will turn over the balance in the Reserve Account to Merchant after Processor reasonably determines that the risk of Chargebacks, Processing Fees or Merchant’s liabilities or obligations under the Merchant Agreement has ended and after deducting all amounts that Merchant owes to Processor and Member Bank under the Merchant Agreement or any other agreement.

14. SECURITY INTEREST.

14.1 Merchant’s Grant of Security Interest.
(a) To secure Merchant’s performance of its obligations under this Merchant Agreement, and any other agreement with Processor or Member Bank, Merchant grants Processor and Member Bank a security interest in each Transaction and its proceeds, provisional credits, the Settlement Account, the Reserve Account (without in any way suggesting that Merchant has ownership interest or property rights in the Reserve Account), and any other deposit account of Merchant with a financial institution, whether now existing City Council or established in the future, and in the proceeds of all those accounts, any funds due to 15 – 23 12/6/2022

Merchant from Processor or Member Bank and any of Merchant’s property held by Processor or Member Bank. Processor and Member Bank may enforce these security interests without notice or demand. The security interests granted under this Merchant Agreement will continue after the Merchant Agreement terminates, until Merchant satisfies all its obligations to Processor and Member Bank.
(b) Furthermore, and with respect to any security interests granted herein, Processor and Member Bank will have all rights afforded under the Uniform Commercial Code, as the same may, from time to time, be in effect in the State of Georgia; provided, however, in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of the security interests granted herein is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of Georgia, then Processor and Member Bank will have all rights afforded under the Uniform Commercial Code as in effect from time to time in such other jurisdiction for purposes of the provisions relating to such attachment, perfection or priority of the security interests, as well as any other applicable law.

14.2 Perfection of Security Interest. Upon request of Processor, Merchant will execute one or more financing statements or other documents to evidence the security interests granted to Processor and Member Bank under this Section 14. Merchant shall cooperate with Processor in obtaining any control agreement or similar agreement with a depository bank necessary to perfect the security interests granted herein. In addition, Merchant agrees that its signature on the Merchant Application will be considered Merchant’s signature agreeing to any control agreement as defined in Article 9 of the Uniform Commercial Code among Merchant, Processor, Member Bank and any other financial institution under which Processor, Member Bank, Merchant and any other financial institution agree to the disposition of funds in the Settlement Account, the Reserve Account or any other deposit account without further consent by Merchant.

15. CUSTOMER CLAIMS. To the extent that Processor or Member Bank has paid or may become liable for a Chargeback or Credit Transaction Receipt, Merchant will be obligated to reimburse Processor and Member Bank for any sums Processor or Member Bank pays or for which Processor or Member Bank is liable. If Merchant does not reimburse Processor or Member Bank, Processor and Member Bank will have all of the rights and remedies of Cardholders, including the Cardholders’ rights under 11 U.S.C. §507(a)(6). Processor and Member Bank may assert any claim on behalf of a Cardholder individually or on behalf of all Cardholders as a class.

16. PROCESSING FEES.

16.1 Fee Schedule. Merchant will pay Processing Fees in the amount specified in the Fee Schedule attached to the Merchant Application or as otherwise provided for in this Merchant Agreement or an Addendum thereto. Monthly recurring Processing Fees will be assessed upon approval of the Merchant Application. Processor may amend, supplement, modify, or increase the Processing Fees, including, without limitation, introducing new products or services, pursuant to Section 10.1 of this Merchant Agreement.

16.2 Card Association Actions. Processor will not be required to provide Merchant with fifteen days’ notice of an increase in Processing Fees in the event that any Card Association, or any other entity having such authority takes any action that increases the Processing Fees.

16.3 Government and Regulatory Actions. Processor will not be required to provide Merchant with fifteen days’ notice for any increase in Processing Fees resulting from any fine, charge, fee or cost incurred in connection with any state, federal or other regulatory action, change in laws or regulations or escheatment of Merchant’s funds.

16.4 Payment. Processing Fees and other service charges, obligations or liabilities owed by Merchant to Processor or Member Bank under the Merchant Agreement may be deducted by Processor or Member Bank from amounts due Merchant, or from the Settlement Account or from the Reserve Account. Merchant will pay the amounts due by the next Business Day if sufficient funds are not available in the Settlement Account.

17. INDEMNIFICATION; LIMITATION OF LIABILITY; WARRANTY.

17.1 Indemnification. Merchant shall indemnify each of Processor and Member Bank, including their respective officers, directors, employees, independent sales organizations (“ISOs”), and agents, against and hold them harmless from any and all claims, demands, settlements, losses, damages, liabilities, costs and expenses of any kind (including reasonable attorney’s fees) of any party arising from or based upon any actual or alleged act or omission of Merchant, Merchant’s employees, Merchant’s designated representatives or agents, Merchant Servicers or Merchant’s Agent(s) in connection with or arising out of this Merchant Agreement, the duties to be performed by Merchant pursuant to the Merchant Agreement, any Transactions which Merchant submits to Processor (including Chargebacks), or Merchant’s actual or alleged violation of the Operating Rules or any Requirements of Law. In the event that Processor or Member Bank is made a party to any litigation, proceeding, arbitration, bankruptcy proceeding, or other legal process (collectively “Actions”) commenced by any third party, Merchant shall protect and hold each of Processor and Member Bank harmless from and with respect to the Actions and shall indemnify such party from and against all costs, expenses, and attorney’s fees, including in-house legal fees, incurred or paid in connection with the Action, together with any judgments, settlements, losses, damages or other liabilities. Merchant shall indemnify, defend, and hold harmless each of Processor and Member Bank from and against any actual or alleged hacking, infiltration, or compromise of Merchant’s systems or the systems of Merchant, Merchant Servicers or Merchant’s Agent(s), designated representatives, or other agents.

17.2 Limitation of Liability. Each of Processor and Member Bank will not accept responsibility for errors, acts, or failure to act by others, including but not limited to, Merchant Servicers, Agents, third party suppliers of software, equipment or services; or, banks, communication common carriers, data processors or clearinghouses through which transactions may be passed, originated and/or authorized. Each of Processor and Member Bank will not be responsible for any loss, liability or delay caused by fires, earthquakes, war, civil disturbances, power surges or failures, acts of governments, acts of terrorism, labor disputes, failures in communication networks, legal constraints or other events beyond the control of Bank. Each of Processor and Member Bank undertakes no duties to Merchant other than the duties expressly provided for in the Merchant Agreement, and any and all other or additional duties that may be imposed upon Processor or Member Bank in law or equity are hereby irrevocably waived and released to the maximum extent permitted by law.

IN ANY EVENT, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE

LAW, THE CUMULATIVE LIABILITY OF EACH OF PROCESSOR AND

MEMBER BANK, AS WELL AS THEIR RESPECTIVE OFFICERS, DIRECTORS,

EMPLOYEES, AND AGENTS, TO MERCHANT, WHETHER ARISING IN

CONTRACT, TORT (INCLUDING, WITHOUT LIMITATION, NEGLIGENCE

AND STRICT LIABILITY) OR OTHERWISE, SHALL NOT EXCEED THE LESSER OF $10,000 OR, THE AMOUNT EQUAL TO THE AGGREGATE OF

MONTHLY NET PROCESSING FEES PAID BY MERCHANT IN THE THREE

MONTH PERIOD PRIOR TO THE MONTH THAT THE INCIDENT GIVING RISE TO LIABILITY OCCURRED.

TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, IN NO

EVENT SHALL EITHER PROCESSOR OR MEMBER BANK OR THEIR

RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES, AND AGENTS BE

LIABLE FOR SPECIAL, INCIDENTAL, INDIRECT, CONSEQUENTIAL OR

EXEMPLARY DAMAGES OR FOR ANY INTERRUPTION OR LOSS OF USE,

DATA, BUSINESS OR PROFITS, WHETHER OR NOT SUCH LOSS OR

DAMAGES WERE FORESEEABLE OR PROCESSOR OR MEMBER BANK WAS

ADVISED OF THE POSSIBILITY THEREOF AND REGARDLESS OF WHETHER ANY LIMITED REMEDY HEREIN FAILS OF ITS ESSENTIAL PURPOSE.

TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW,

PROCESSOR AND MEMBER BANK SPECIFICALLY DISCLAIM ALL

WARRANTIES OF ANY KIND, EXPRESSED OR IMPLIED, INCLUDING,

WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTABILITY OR

FITNESS FOR A PARTICULAR PURPOSE OR NON-INFRINGEMENT OF ANY

INTELLECTUAL PROPERTY RIGHT WITH RESPECT TO THE SERVICES PROVIDED HEREUNDER. WITHOUT LIMITING THE GENERALITY OF THE

FOREGOING, PROCESSOR AND MEMBER BANK DO NOT GUARANTEE OR WARRANT THAT THE SERVICES WILL BE UNINTERRUPTED OR ERRORFREE.

18. NOTICES. Each notice required by the Merchant Agreement will be in writing (hard copy or electronic), except as otherwise stated in the Merchant Agreement, and will be effective when delivered, (a) to Member Bank at the address designated on the Merchant Application, and the return address on Merchant’s Card processing statements, (b) to Processor at the address designated on the Merchant Application and (c) to Merchant at Merchant’s address to which Processor mails Merchant’s statements or at the electronic mail address provided by Merchant in the Merchant Application, or at such other address as any party may provide by written notice to the other parties. Any address Merchant designates may also be the address to which Processor mails Merchant’s statements. Where applicable, delivery by facsimile transmission or electronic mail will be considered effective when the sender receives electronic confirmation of the transmission.

19. GEORGIA LAW; JURISDICTION; VENUE. Merchant’s offer to enter into this Merchant Agreement is made in Muscogee County, Georgia; this Merchant Agreement shall be performed by Merchant in Muscogee County, Georgia and governed by Georgia law, excluding its conflict of laws rules. Merchant and Guarantor agree to bring any claim or action relating to the Merchant Agreement in binding arbitration as set forth in Section 20.2 below. Any matters not otherwise subject to arbitration (such as, by way of example only, injunctive relief, action to recover any monetary losses or damages from unpaid obligations of the Merchant under the Merchant Agreement, or claims to enforce an arbitration award), shall be brought in the state or federal courts located in Muscogee County, Georgia. All parties irrevocably and unconditionally submit to the jurisdiction of such courts with respect to any such action. In the event that Processor or Member Bank is required to resolve a dispute with Merchant that requires any action under this provision, Merchant hereby agrees and consents to receive service of process by certified mail.

20. ATTORNEY FEES; ARBITRATION; CLASS ACTION WAIVER.

20.1 Attorney Fees. Merchant and/or Guarantor will be liable for and will indemnify and reimburse Processor and Member Bank for all attorneys’ fees, including in-house legal fees, and other costs and expenses paid or incurred by Processor and Member Bank in the enforcement of this Merchant Agreement or in matters relating to this Merchant Agreement, or arising from any breach by Merchant of this Merchant Agreement, or any other wrongdoing by Merchant or Guarantor. In the event Processor or Member Bank must engage in any recovery or collection efforts to collect any amounts due from Merchant to Processor or Member Bank, Merchant will reimburse Processor and Member Bank for all fees and expenses incurred in such collection, plus reasonable administrative fees and expenses.

20.2 Arbitration. NOTE: PLEASE READ THIS SECTION CAREFULLY AS IT AFFECTS YOUR

RIGHTS AND THE RESOLUTION OF DISPUTES

ANY DISPUTE OR CLAIM ARISING OUT OF, RELATING TO, OR IN CONNECTION

WITH THIS AGREEMENT OR THE RELATIONSHIPS WHICH RESULT FROM THIS

AGREEMENT SHALL BE RESOLVED BY BINDING ARBITRATION, RATHER City Council THAN IN COURT; HOWEVER, MERCHANT MAY ASSERT CLAIMS IN SMALL 15 – 24 12/6/2022

CLAIMS COURT IF (1) THE CLAIMS QUALIFY FOR SMALL CLAIMS COURT; (2) THE MATTER REMAINS IN SMALL CLAIMS COURT AT ALL TIMES; AND (3) THE

MATTER PROCEEDS ONLY ON AN INDIVIDUAL (NOT A CLASS OR
REPRESENTATIVE BASIS). ARBITRATION DOES NOT PROCEED BEFORE A JURY

AND MAY INVOLVE MORE LIMITED DISCOVERY THAN A COURT
PROCEEDING. ANY ARBITRATION UNDER THIS AGREEMENT WILL ONLY BE ON AN INDIVIDUAL BASIS. CLASS ARBITRATIONS, CLASS ACTIONS, PRIVATE

ATTORNEY GENERAL ACTIONS, AND CONSOLIDATION WITH OTHER
ARBITRATIONS ARE NOT PERMITTED.

The arbitrator's award or decision will not affect issues or claims involved in any proceeding between Processor or Member Bank and any person or entity who is not a party to the arbitration. The arbitrator may award monetary, declaratory or injunctive relief only in favor of the individual party seeking relief and only to the extent necessary to provide relief warranted by that party's individual claim. The arbitrator's award, if any, will not apply to any person or entity that is not a party to the arbitration. However, nothing in this Section or Merchant Agreement shall preclude any party from bringing issues to the attention of federal, state or local agencies. Such agencies can, if the law allows, seek relief on your behalf.

Further, notwithstanding the foregoing, nothing in this Section or this Merchant Agreement prohibits a party from applying to a court of competent jurisdiction for a temporary restraining order, preliminary injunction, or other equitable relief.

The Federal Arbitration Act (9 U.S.C. § 1 et seq.) governs the interpretation and enforcement of the arbitration provisions of this section. Arbitration will be administered by JAMS (www.jamsadr.com). For claims greater than $250,000, the JAMS Comprehensive Arbitration Rules and Procedures in effect at the time the arbitration is commenced will apply (if no such rules are in effect, JAMS default arbitration rules shall apply). For claims equal to or less than $250,000, the JAMS Streamlined Arbitration Rules and Procedures in effect at the time the arbitration is commenced will apply (if no such rules are in effect, JAMS default arbitration rules shall apply). Unless the arbitrator(s) determine that justice or fairness require otherwise: (i) any arbitration will proceed in Muscogee County, Georgia (although, for the convenience of the Merchant or Guarantor (as applicable), any party or its counsel may participate telephonically); and (ii) the arbitrator(s) will oversee limited discovery, taking into account the amount in controversy and the parties’ desire to keep proceedings cost-effective and efficient. Any decision rendered in any arbitration proceeding shall be final and binding on each of the parties to the arbitration and judgment may be entered thereon in any court of competent jurisdiction. The parties will maintain the confidential nature of the arbitration proceeding except as may be necessary to enforce any award or to comply with applicable law.

If the total damage claims in an arbitration are $10,000 or less, not including Merchant’s attorney fees (“Small Arbitration Claim"), the arbitrator may, if the MERCHANT, prevails, award the Merchant reasonable attorney fees, expert fees and costs (separate from Arbitration Costs as defined below), but may not grant Processor its attorney fees, expert fees or costs (separate from Arbitration Costs) unless the arbitrator determines that the Merchant’s claim was frivolous or brought in bad faith. In a Small Arbitration Claim case, ISO will pay all arbitration filing, administrative and arbitrator costs (together, “Arbitration Costs"). The Merchant must submit any request for payment of Arbitration Costs to JAMS at the same time the Merchant submits its Demand for Arbitration. However, if the Merchant wants Processor to advance the Arbitration Costs for a Small Arbitration Claim before filing, Processor will do so at the Merchant’s written request which must be sent to Processor at the address in Section 18 above.

If the Merchant’s total damage claims in an arbitration exceed $10,000, not including the Merchant’s attorney fees (“Large Arbitration Claim"), the arbitrator may award the prevailing party its reasonable attorneys' fees and costs, or it may apportion attorneys' fees and costs between the Merchant and Processor (such fees and costs being separate from Arbitration Costs). In a Large Arbitration Claim case, if the Merchant is able to demonstrate that the Arbitration Costs will be prohibitive as compared to the costs of litigation, ISO will pay as much of the Arbitration Costs as the arbitrator deems necessary to prevent the arbitration from being cost-prohibitive.

Merchant hereby agrees that claims applicable to American Express may be resolved through arbitration as further described in the American Express Merchant Requirements Guide (the “American Express Guide”).

A court, not the arbitrator, will decide any questions regarding the validity, scope and/or enforceability of this Section

20.3 Class Action Waiver. NOTE: PLEASE READ THIS SECTION CAREFULLY AS IT AFFECTS YOUR

RIGHTS AND THE RESOLUTION OF DISPUTES

MERCHANT AND GUARANTOR (IF APPLICABLE) ACKNOWLEDGE AND AGREE

THAT ALL DISPUTES ARISING OUT OF OR RELATED TO THIS MERCHANT

AGREEMENT SHALL BE RESOLVED ON AN INDIVIDUAL BASIS WITHOUT

RESORT TO ANY FORM OF CLASS ACTION AND SHALL NOT BE
CONSOLIDATED WITH THE CLAIMS OF ANY OTHER PARTIES.

21. FINAL AGREEMENT. This Merchant Agreement and all applicable Addenda attached hereto, is the complete and final agreement between Merchant, Processor and Member Bank for the Card Program services covered by this Merchant Agreement and supersedes all prior or contemporaneous negotiations, stipulations or agreements between them with respect thereto. In the event of any conflict or inconsistency between this Merchant Agreement and any other agreement between Processor or any of its affiliates and Member Bank or any of its affiliates (but not Merchant), such other agreement shall control with respect to such conflict or inconsistency. If any provision of this Merchant Agreement is invalid or unenforceable, the other provisions remain effective.

22. SEVERABILITY. If any term or provision of this Merchant Agreement is found to be invalid, illegal or otherwise unenforceable, the same shall not affect the other terms or provisions hereof or the whole of this Merchant Agreement, but such terms or provisions shall be deemed modified to the extent necessary to render such term or provision enforceable, and the rights and obligations of the parties shall be construed and enforced accordingly, preserving to the fullest permissible extent the intent and agreements of the parties herein set forth. No part or portion of 20.2 (Arbitration) or Section 20.3 (Class Action Waiver) shall be deemed so integral to either this Agreement as a whole, or to the remaining parts or portions of Sections 20.2 or 20.3 hereof, that the unenforceability of that part or portion should have any impact on or render the remainder unenforceable.

23. CONTINUING GUARANTY.

23.1 As a primary inducement to Processor to enter into the Merchant Agreement, and to approve the Merchant Application of Merchant, the Guarantor(s), individually and severally, who signed on the Guarantor signature line(s) on the Merchant Application, agree to be bound by all terms and provisions of the Merchant Agreement to the same extent and in the same manner as Merchant, and unconditionally and irrevocably, personally guarantee the continuing full and faithful performance and payment by Merchant of each and all of Merchant’s duties and obligations to Processor and Member Bank under the Merchant Agreement or any other agreement currently in effect or in the future entered into between Merchant or its principals and Processor or Member Bank, as such agreements now exist or are amended from time to time, with or without notice to Guarantor(s).

23.2 Merchant and Guarantor(s) further agree to be bound by the terms and provisions of any Merchant Agreement between Processor or Member Bank and any Merchant Affiliate, regardless of whether such agreement currently exists or is executed, amended or supplement at some future date. Merchant and Guarantor(s) unconditionally and irrevocably guarantee the full payment and performance of each and all duties and obligations owed to Processor or Member Bank by Merchant Affiliate pursuant to any Merchant Agreement. The provisions of Section 23.3 apply to the guarantee by Merchant and Guarantor(s) of the Merchant Affiliate’s obligations to Processor or Member Bank under any Merchant Card Processing Agreement.

23.3 Guarantor(s) understands that Processor, without notice to Guarantor(s), may from time to time renew or extend the Merchant Agreement, modify rates, limits, charges and fees, or modify the amount or type of services provided to Merchant all of which may increase the Guarantor’s obligations under this Guaranty. Guarantor(s) further understands that Processor may proceed directly against Guarantor(s) without first exhausting Processor’s remedies against Merchant, any other person or entity responsible to Processor or any security held by Processor. This Guaranty is a continuing guaranty and will not be discharged or affected by the release or discharge of Merchant or the death of the Guarantor(s). This Guaranty will bind all heirs, administrators, and representatives of the Guarantor(s) and may be enforced by or for the benefit of any successor of Processor. To the fullest extent permissible under applicable law, Guarantor(s) waives any and all rights of subrogation, reimbursement or indemnity derived from Merchant, all other rights and defenses available to Merchant, and all other rights and defenses available to Guarantor(s). This Guaranty may not be otherwise revoked, suspended, withdrawn or terminated without the express written consent of Processor.

24. AUTHORIZED USERS. To the extent Merchant is granted electronic access to any systems or portals of Processor, Merchant shall be responsible for (i) ensuring that only authorized users of such systems or portals access the same; (ii) keeping all logins, user names, and passwords confidential; and (iii) promptly notifying Processor of any unauthorized access of such logins, user names, or passwords; and (iv) all actions taken by anyone using such access, logins, user names, or passwords, even if such actions were not authorized by Merchant.

25. TAXES. Merchant shall be solely responsible for the calculation, collection, and remittance of any sales tax imposed by any government authority in connection with the provision of Merchant’s goods or services. Unless Merchant is otherwise exempt (and can prove such exemption to Processor’s satisfaction), Merchant agrees to pay all taxes imposed on the services, equipment, or other property provided to Merchant pursuant to this Agreement.

26. RELATIONSHIP OF THE PARTIES. Merchant designates Processor as its agent to receive payments for transactions processed pursuant to this Card Services Agreement.

Processor, however, shall not be considered a partner or fiduciary to Merchant, and nothing in this Merchant Agreement or the rendition of services related to this Merchant Agreement shall be deemed to create a joint venture, partnership, or fiduciary relationship between or among the parties. Rather, the relationships between Member Bank and Merchant, and between Processor and Merchant, are arm’s length commercial relationships.

27. PRODUCTS AND SERVICES.

Important Note: Merchant acknowledges and agrees that Member Bank and its affiliates have no obligation or liability whatsoever for: (1) the Products and Services described City Council 15 – 25 12/6/2022