Santa Cruz City Council
January 13, 2026

CITY COUNCIL AGENDA
Regular Meeting - January 13, 2026
Council Chambers
809 Center Street
Santa Cruz
1:00 P.M. CLOSED SESSION
2:30 P.M. ORAL COMMUNICATIONS, CONSENT, GENERAL BUSINESS AND PUBLIC

HEARINGS
Council meetings are hybrid, and may be viewed remotely, using any of the following sources:
 Click on Zoom link (no time delay): https://zoom.us/j/94684401344  Online at http://www.cityofsantacruz.com/government/city-council/council-meetings  Online at Watch – Community Television of Santa Cruz County  Comcast Channel 25
Or: Call any of the numbers below. If one is busy, try the next one.  1-833-548-0276 (Toll Free)
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 1-669-900-9128
 Enter the meeting ID number: 946 8440 1344
 When prompted for a Participant ID, press #.
 Press *9 on your phone to “raise your hand” when the Mayor calls for public comment.  It will be your turn to speak when the Mayor calls on you. Press *6 to unmute yourself. The timer will then be set.

Correspondence to be included in the agenda packet must be received by 5:00 pm on Monday, January 12th
PLEASE NOTE:
 Council may take a break(s) as needed.
 Requests for extra speaking time on items other than Oral Communications must be made by 5:00 p.m. on Sunday, January 11th by emailing the Mayor and the City Clerk.

Approval will be confirmed via email.
[email protected] [email protected]
January 13, 2026 City Council 2
The City of Santa Cruz does not discriminate against persons with disabilities. Out of consideration for people with chemical sensitivities we ask that you attend fragrance free. Upon request, the agenda can be provided in a format to accommodate special needs. Additionally, if you wish to attend this public meeting and will require assistance such as an interpreter for American Sign Language, Spanish, or other special equipment, please call the City Clerk’s Department at 420-5030 at least five days in advance so that we can arrange for such special assistance, or email [email protected]. The CalRelay system number: 1-800-735-2922.

Si desea asistir a esta reunión pública y necesita ayuda - como un intérprete de lenguaje de señas americano, español u otro equipo especial - favor de llamar al Departamento de la Secretaría de la Ciudad al 420-5030 al menos cinco días antes para que podamos coordinar dicha asistencia especial o envié un correo electrónico a [email protected]. El número del sistema Cal-Relay es: 1-800-735-2922.

Agenda and Agenda Packet Materials: The City Council agenda and the complete agenda packet containing public records, which are not exempt from disclosure pursuant to the California Public Records Act, are available for review on the City’s website:
www.cityofsantacruz.com/government/city-council-meetings and at the Office of the City Clerk located at 809 Center Street, Room 8, Santa Cruz, California, during normal business hours.

Agenda Materials Submitted after Publication of the Agenda Packet: Pursuant to Government Code §54957.5, public records related to an open session agenda item submitted after distribution of the agenda packet are available at the same time they are distributed or made available to the legislative body on the City’s website at: www.cityofsantacruz.com/government/city-councilmeetings and are also available for public inspection at the Office of the City Clerk, 809 Center Street Room 8, Santa Cruz, California, during normal business hours, and at the Council meeting.

Need more information? Contact the City Clerk’s office at 831-420-5030. 1:00 PM
Swearing-in of City Attorney Cassie Bronson
Statements of Disqualification
Public Comment on Closed Session items
Closed Session

1. Conference With Legal Counsel – Liability Claims (Government Code §54956.95)
1) Claimant: Jeffrey Marshall Paine
2) Claimant: Ann Sisco
3) Claimant: Curron Michael-Edward Clark
4) Claimant: Curron Michael-Edward Clark
5) Claimant: Curron Michael-Edward Clark
6) Claimant: Curron Michael-Edward Clark
Claims against the City of Santa Cruz
January 13, 2026 City Council 3
Closed Session (continued)

2. Real Property Negotiations (Government Code §54956.8) 1) Property: 1305 E. Cliff Drive
APN: 010-282-01
Owner: City of Santa Cruz
City Negotiators: Tony Elliot
Negotiating Parties: City of Santa Cruz and Felicia Van Stolk Under Negotiation: Price, Terms of payment, or both
2) Property: 1330 and 1344 Pacific Avenue
APN: 005-081-35 and 005-081-37
Owner: Palomar Associates
City Negotiator: Bonnie Lipscomb
Negotiating Parties: City of Santa Cruz and Palomar Associates Under Negotiation: Price, Terms of payment, or both
3) Property: 121 Soquel Avenue
APN: 005-081-51 (Portion)
Owner: Oswald, LLC dba Oswald
City Negotiator: Bonnie Lipscomb
Negotiating Parties: City of Santa Cruz and Damani Thomas Under Negotiation: Price, Terms of payment, or both

3. Conference with Legal Counsel - Existing Litigation (Government Code §54956.9(d)(1))
Townsend, Dominique v. City of Santa Cruz, et al.
(Santa Cruz County Superior Court Case No. 23CV02872)

4. Conference with Labor Negotiators (Government Code §54957.6) Fire Management
Police Officers Association
Supervisors, OE3
City Negotiator - Sara De Leon

5. Public Employee Performance Evaluation/Conference with Labor Negotiators (Government Code §54957, §54957.6)
Unrepresented employee: City Manager
Agency designated representative: City Attorney
January 13, 2026 City Council 4
City Council
2:30 PM
Call to Order
Roll Call
Oral Communications - Members of the public may address Council on matters not on the agenda, but within the jurisdiction of the Council. 30 minutes is allocated for Oral Communications. No extra time for groups will be granted.

Presentation

6. Mayoral Proclamation Declaring January 2026 as Human Trafficking Awareness and Prevention Month
Presiding Officer's Announcements
Statements of Disqualification
Additions and Deletions
City Attorney Report on Closed Session
Council Meeting Calendar

7. The City Council will review the meeting calendar attached to the agenda and revise it as necessary.

January 13, 2026 City Council 5
Consent Agenda

8. Resolution Extending the Emergency Declarations in Connection with the 2022/2023 Winter Storms and 2023/2024 Winter Storms (CA) LOCATION: Citywide
Motion to adopt a resolution extending by sixty days the Local Emergency Declarations in connection with the 2022/2023 and 2023/2024 Winter Storms.

9. Resolution Extending the Emergency Declaration in Connection with the December 2024 Municipal Wharf Emergency (CA/CM)
LOCATION: District 4
Motion to adopt a resolution extending by sixty days the Local Emergency Declaration in connection with the December 2024 Municipal Wharf emergency.

10. Minutes of the December 9, 2025 City Council Meeting (CC) LOCATION: None
Motion to approve as submitted.

11. Resolution Ordering an Election for Three Council Seats, Districts 4 and 6, and Mayor, for the June 2, 2026 Primary Election (CC) LOCATION: Citywide
Motion to adopt a resolution ordering an election, requesting the County Elections Department to conduct the election, and requesting consolidation of the election with the June 2, 2026 Primary Election.

12. Appointment of Representatives to External Agencies, Groups, Council Committees and Task Forces (CC)
LOCATION: Citywide
Motion to approve Mayor Keeley’s nominations to external agencies, groups, and City Council committees and task forces for the 2026 calendar year.

January 13, 2026 City Council 6
Consent Agenda (continued)

13. Adoption of Policy Framework for the Sugar-Sweetened Beverage Tax Oversight Committee (SSBTOC) (CM/CN)
LOCATION: Citywide
Motion to adopt a policy framework, as described in this agenda report, establishing the Sugar-Sweetened Beverage Tax Oversight Committee (SSBTOC), consistent with Santa Cruz Municipal Code §3.38.015, to ensure community oversight, transparency, and equitable allocation of revenues generated by the Sugar-Sweetened Beverage (SSB) Tax.

14. FY25 Strategic Plan Annual Report (CM)
LOCATION: Citywide
Motion to approve the Fiscal Year (FY) 25 Strategic Plan Annual Report.

15. Distribution of Coast Pump Station Battery Storage Tax Credit (CM/PW/WT)
LOCATION: Citywide
Motion to:
1) Approve the distribution of revenue from the Coast Pump Station Battery Storage federal investment tax credit; and
2) Adopt a resolution amending the revenues and expenditures in the FY 2026 Budget by $1,766,641 and $1,736,641, respectively, for the General Fund ($1,589,977), the Photovoltaic Systems Improvements project (c702602, $73,332), the Solar PV Expansion at Corp Yard project (c101901, $73,332), and the Carbon Fund ($30,000).

January 13, 2026 City Council 7
Consent Agenda (continued)

16. Navigation Center Funding Agreement (EDH)
LOCATION: District 5
Motion to:
1) Reauthorize the City Manager, or designee, to execute the California Department of Health Care Services (DHCS) Behavioral Health Infrastructure Bond Program Funding Agreement (PFA) and any documents, amendments or extensions of a non-substantive nature, in a form approved by the City Attorney;
2) Adopt a resolution amending the Fiscal Year 2026 budget to appropriate $30,100,000 to grant funding and match; and 3) Adopt a finding of Categorical Exemption pursuant to CEQA Guidelines Section 15332 (In-Fill Development Projects); and Statutory Exemptions pursuant to Cal. Welfare & Institutions Code §5960.3(b) and Government Code §65662 (Low Barrier Navigation Centers).

17. Palomar Inn Affordable Housing Preservation (EDH)
LOCATION: District 4
Motion to:
1) Authorize the City Manager, or designee, to execute an affordable housing preservation loan agreement, and any related documents, amendments or extensions, in a form to be approved by the City Attorney;
2) Adopt a resolution amending the Fiscal Year 2026 budget to appropriate $1,000,000 in the Affordable Housing Trust Fund (AHTF), transferred from the Housing Successor Agency, as a loan to the Palomar Inn Project; and
3) Adopt a finding of Categorical Exemption pursuant to CEQA Guideline Section 15301 (Existing Facilities).

January 13, 2026 City Council 8
Consent Agenda (continued)

18. Living Wage Rate Annual Prescription for Fiscal Year 2027 (FN) LOCATION: Citywide
Motion to adopt a resolution upwardly indexing the prescribed minimum living wage rate by 2.7%, the amount which corresponds to San Francisco-Oakland-Hayward Area Consumer Price Index (CPI) for Urban Wage Earners and Clerical Workers, for the period ending August 31, 2025, to become effective July 1, 2026; and rescinding Resolution No. NS-30,433.

19. Liability Claims Filed Against the City of Santa Cruz (FN) Motion to reject the liability claims of 1) Jeffrey Marshall Paine, 2) Ann Sisco, and 3) Curron Michael-Edward Clark, and to return as late, the claims of 4) Curron Michael-Edward Clark, 5) Curron Michael-Edward Clark, and 6) Curron Michael-Edward Clark; based on staff recommendation.

20. Outside Legal Services – Budget Adjustment (HR)
LOCATION: Citywide
Motion to adopt a resolution to amend the Fiscal Year (FY) 2026 budget to appropriate funds in the amount of $363,394 to the Human Resources Department for outside legal services.

21. 2025-2028 City of Santa Cruz Fire Management Association Agreement for Successor Memorandum of Understanding (HR)
LOCATION: Citywide
Motion to adopt a resolution adopting a Total Tentative Agreement between the City of Santa Cruz and the Fire Management Association effective October 11, 2025 through July 3, 2028.

January 13, 2026 City Council 9
Consent Agenda (continued)

22. 2025-2028 City of Santa Cruz Supervisors Operating Engineers, Local 3 Agreement for Successor Memorandum of Understanding (HR) LOCATION: Citywide
Motion to adopt a resolution approving the Total Tentative Agreement between the City of Santa Cruz and the Supervisors Operating Engineers, Local 3, dated December 6, 2025 through December 8, 2028.

23. Neary Lagoon Tule & Sediment Removal Project 2025 (m409668) – Notice of Completion (PW)
LOCATION: District 3
Motion to accept the work of McNabb Construction, Inc. (Lafayette, CA) as completed per plans and specifications and authorize the filing of the Notice of Completion for the Neary Lagoon Tule & Sediment Removal Project 2025 (m409668) and authorizing the Public Works Director to sign the Notice of Completion as the Owner’s Authorized Agent.

24. Soquel Avenue Minor Striping Improvements 2025 (PW) LOCATION: Districts 1 and 2
Motion to:
1) Approve the Soquel Avenue Minor Striping Improvements 2025 Plan; 2) Adopt a resolution to approve the Soquel Avenue Minor Striping Improvements 2025 Plan pursuant to Government Code Section 830.6; and
3) Adopt a finding of Categorical Exemption under CEQA Guidelines 14 CCR section 15301(c) (existing facilities).

January 13, 2026 City Council 10
Consent Agenda (continued)

25. Purchase of Vac Con Vactor Truck (WT)
LOCATION: None
Motion to purchase a hydro-excavator truck from Vac-con (Green Cove Springs, FL) in the amount of $742,564.02 under the existing cooperative contract with Sourcewell.

End Consent Agenda
General Business

26. Introduce for Publication an Ordinance Amending Chapter 16.02 of the Santa Cruz Municipal Code Restricting the Irrigation of Nonfunctional Turf (WT)
LOCATION: County (Water Service Area)
Motion to:
1) Introduce for publication an ordinance amending Chapter 16.02 of the Santa Cruz Municipal Code restricting the irrigation of nonfunctional turf; and
2) Adopt a finding of categorical exemption pursuant to California Environmental Quality Act (CEQA) Guidelines Section 15307 (Actions by Regulatory Agencies for Protection of Natural Resources) and Section 15308 (Actions by Regulatory Agencies for Protection of the Environment).

January 13, 2026 City Council 11
General Business (continued)

27. Climate Action Plan 2030 – 2022-2025 Citywide Implementation Workplan Progress Report and Proposed 2026-2029 Citywide Implementation Workplan (CM)
LOCATION: Citywide
Motion to:
1) Accept Climate Action Plan 2030 (CAP 2030) - 2022-2025 Citywide Implementation Workplan Progress Report; and
2) Approve CAP 2030 – Proposed 2026-2029 Citywide Implementation Workplan.

28. Terminate Flock Safety Automated License Plate Reader (ALPR) Contract; Cease ALPR Use; Direct Conditional Return Only if a FullyVetted, Values-Aligned ALPR Alternative is Identified (CN) LOCATION: Citywide
Motion to:
1) Terminate the City’s contract with, and discontinue use of, Flock Safety ALPR services effective immediately and direct the City Manager/City Attorney to provide the necessary notice; and 2) Direct staff to return to City Council with a recommended approach for reinstituting ALPRs, only if and when a viable option is identified, including:
a. Recommended vendor/system that provide stronger local controls; and
b. Recommended contract and policy safeguards to ensure system transparency, protect civil liberties, and reduce cybersecurity risks, including strict controls on data access/sharing and independent auditability.

Adjournment
January 13, 2026 City Council 12

INFORMATION ITEMS PREVIOUSLY DISTRIBUTED TO CITY COUNCILMEMBERS ADDENDUM TO CITY COUNCIL AGENDA – JANUARY 13, 2026

29. City Clerk - 2025 Advisory Body Absence Reports 1/7/26 (CCFYI 224)

30. Economic Development and Housing Department: Sixth Amendment with Santa Cruz County Symphony Association, Inc. 12/5/25 (EDHFYI 008)

31. Economic Development and Housing Department: Downtown Library Affordable Housing Project Update 12/18/25 (EDHFYI 001)

32. Economic Development and Housing Department: Amendment to the License Agreement with Humble Sea Brewing 12/8/25 (EDHFYI 009)

MAYOR'S PROCLAMATIONS
ADDENDUM TO CITY COUNCIL AGENDA – JANUARY 13, 2026

33. Proclaiming Thursday, December 18, 2025 as “Bob Nelson Day” and urging all citizens and his coworkers to join in thanking him for his nearly thirty-five years of dedicated and exemplary service and recognizing his exceptional leadership and substantial contributions to the Public Works Department and the community.

34. Proclaiming December 13, 2025 as “The 418 Project Transgender Celebration Day” and encouraging all residents to visit, engage, and participate in the enriching activities and community-building endeavors offered by The 418 Project on this day and throughout the year.

35. Proclaiming November 30, 2025 as “Santa Cruz Roller Palladium Day” and encouraging all residents to recognize this roller-skating rink’s historic significance, celebrate its enduring cultural contribution, and join in commemorating this remarkable 75th anniversary.

January 13, 2026 City Council 13
MAYOR'S PROCLAMATIONS (continued)

36. Proclaiming January 3, 2026 as “I.A.T.S.E. Local 611 Stagehands Day” and urging all residents to join in recognizing this monumental milestone; celebrating the contributions of local stagehands to our community as well as the communities of our neighbors in San Benito and Monterey counties; and reflecting on Local 611’s rich history, honoring its present achievements, and looking forward to a future of continued excellence in entertainment and the success of I.A.T.S.E.

Local 611 and its members.

37. Proclaiming December 18, 2025 as “Tony Condotti Day” and encouraging all citizens and his coworkers to join in recognizing and commending him for his ten years as City Attorney and more than thirty years of dedicated and exemplary legal service to the City of Santa Cruz and expressing heartfelt appreciation for his faithful service, leadership, and lasting contributions to good governance and the public trust.

Advisory Body Appointments
The following positions are either currently vacant or the terms are due to expire.

Council will make appointments at a future meeting.

Arts Commission One opening – to be appointed by
Councilmember O’Hara.

Board of Building and Fire
Appeals
One opening – at-large nomination.

Children’s Fund Oversight
Committee
Two openings – at-large nominations.

County Latino Affairs Commission One opening - at-large nomination.

Downtown Commission One opening – to be appointed by
Councilmember Trigueiro.

Historic Preservation Commission Two openings – to be appointed by Councilmembers Brunner and
Newsome.

Parks and Recreation Commission Two openings - to be appointed by Vice Mayor Kalantari-Johnson and
Councilmember Brunner.

January 13, 2026 City Council 14
Planning Commission Three openings – to be appointed by Vice Mayor Kalantari-Johnson and
Councilmembers O’Hara and Newsome.

Sister Cities Committee One opening – at-large nomination.

Transportation and Public Works
Commission
One opening – to be appointed by
Councilmember Brunner.

Water Commission One opening – to be appointed by
Councilmember Brunner
Public Hearing
If, in the future, you wish to challenge in court any of the matters on this agenda for which a public hearing is to be conducted, you may be limited to raising only those issues which you (or someone else) raised orally at the public hearing or in written correspondence received by the City at or before the hearing.

Any person seeking to challenge a City Council decision made as a result of a proceeding in which, by law, a hearing is required to be given, evidence is required to be taken, and the discretion in the determination of facts is vested in the City Council, shall be required to commence that action either 60 days or 90 days following the date on which the decision becomes final as provided in Code of Civil Procedure Section 1094.6 Please refer to code of Civil Procedure 1094.6 to determine how to calculate when a decision becomes “final.” The 60-day rule applies to all public hearings conducted pursuant to the City’s Zoning Ordinance, Title 24, Santa Cruz Municipal Code. The 90-day rule applies to all other public hearings.
2026 City Council Meeting Calendar
December 25, 2025 - City Hall Closure - Christmas Day
January 1 - City Hall Closure - New Years Day
January 13 - Regular Meeting
January 19 - City Hall Closure - Martin Luther King Jr. Day January 27 - Regular Meeting
February 10 - Regular Meeting
February 16 - City Hall Closure - Presidents' Day
February 24 - Regular Meeting
March 10 - Regular Meeting
March 24 - Regular Meeting
March 31 - City Hall Closure - Cesar Chavez Day
April 1/2 - Passover (City observed sundown to sundown) April 14 - Regular Meeting
April 28 - Regular Meeting
May 12 - Regular Meeting
May 25 - City Hall Closure - Memorial Day
May 26 - Regular Meeting/Budget Hearings
May 27 - Special Meeting - Budget Hearings
June 9 - Regular Meeting
June 19 - City Hall Closure - Juneteenth
June 23 - Regular Meeting
July 3 - City Hall Closure - Independence Day
July 14 and 28 Meetings Cancelled
August 11 - Regular Meeting
August 25 - Regular Meeting
September 7 - City Hall Closure - Labor Day
September 8 - Regular Meeting
September 11/12 - Rosh Hashanah (City observed -  sundown to sundown) October 20/21 - Yom Kippur (City observed -  sundown to sundown) September 22 - Regular Meeting
October 13 - Regular Meeting
October 27 - Regular Meeting
November 11 - City Hall Closure - Veteran's Day (observed) November 17 - Regular Meeting
November 26 - City Hall Closure - Thanksgiving Day
November 27 - City Hall Closure - Day After Thanksgiving Day December 4/5 - Hanukkah (City observed -  sundown to sundown) December 8 - Regular Meeting
December 22 Meeting Cancelled
December 25

7.1 City Council

AGENDA REPORT
DATE: 12/24/2025
AGENDA OF: 01/13/2026
DEPARTMENT: City Attorney
SUBJECT: Resolution Extending the Emergency Declarations in Connection with the 2022/2023 Winter Storms and 2023/2024 Winter Storms (CA) LOCATION: Citywide
RECOMMENDATION: Motion to adopt a resolution extending by sixty days the Local Emergency Declarations in connection with the 2022/2023 and 2023/2024 Winter Storms.

BACKGROUND: On January 4, 2023, the City Manager declared the existence of a local emergency following storms in December 2022 and January 2023 (“2022/2023 Winter Storms”) that caused significant flooding, infrastructure damage, and other storm impacts, including downed trees and impacts to persons experiencing homelessness.

A year later, and while responses to the 2022/2023 Winter Storms remained ongoing, the City of Santa Cruz (“City”) experienced another significant storm event that resulted in flooding and significant damage to City infrastructure (“2023/2024 Winter Storms”). The City Manager again declared the existence of a local emergency as a result of the 2023/2024 Winter Storms on February 6, 2024.

DISCUSSION: Government Code section 8630 authorizes a governing body of a city or an official designated by ordinance to proclaim the existence of a local emergency. Santa Cruz Municipal Code section 2.20.030 empowers the Director of Emergency Services to proclaim the existence or threatened existence of a local emergency when the City is affected or likely to be affected by a public calamity or disaster, subject to confirmation by the City Council at the “earliest practicable time.” During the existence of such emergency, the Director of Emergency Services is also authorized, pursuant to Section 2.20.040(1), to “[m]ake and issue rules and regulations on matters reasonably related to the protection of life and property as affected by such emergency,” also subject to confirmation by the City Council “at the earliest practicable time.”
In view of the facts and circumstances described above and damage caused by the 2022/2023 and 2023/2024 Winter Storms, the City Council ratified the City Manager’s January 4, 2023 emergency declaration by Resolution No. NS-30,085 at its January 10, 2023 regular meeting, and ratified the City Manager’s February 6, 2024 emergency declaration by Resolution No. NS30,286 at its February 13, 2024 regular meeting.

8.1 At its September 10, 2024 regular meeting the City Council received an update from the Director of Public Works on the City’s response to the 2022/2023 and 2023/2024 Winter Storms. The City’s emergency response and recovery efforts remain ongoing and could continue into Summer 2026.

The attached resolution, if adopted by the City Council, would extend the 2022/2023 Winter Storms emergency declaration and 2023/2024 Winter Storms emergency declaration by an additional 60 days, to March 14, 2026.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed Council action is not a “project” under CEQA because it will not “cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment[.]” (Pub. Resources Code, § 21065.)
HEALTH IN ALL POLICIES (HiAP): This action is consistent with the three pillars of HiAP.

Specifically, the action has a nexus with public health in that the resolution is intended to help the City obtain reimbursement for recovery efforts along West Cliff Drive. Recovery efforts in this area will ensure accessible and safe biking, pedestrian, and recreational access for future public use and enjoyment.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: Actions taken by the City during a declared emergency are potentially recoverable from Cal OES (California Governor’s Office of Emergency Services) and FEMA (Federal Emergency Management Agency).

Prepared By:

Kaylen Anderson
Deputy City Attorney
Submitted By:

Cassie Bronson
City Attorney
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

8.2 RESOLUTION NO. NS-XX,XXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ EXTENDING THE LOCAL EMERGENCY DECLARATIONS IN CONNECTION WITH THE 2022/2023 WINTER STORMS AND 2023/2024 WINTER STORMS
WHEREAS, Government Code section 8630 authorizes the City Council or an official designated by ordinance to proclaim the existence of a local emergency; and WHEREAS, Santa Cruz Municipal Code section 2.20.030 empowers the City Manager, as the director of emergency services, to proclaim the existence or threatened existence of a local emergency when the City of Santa Cruz (“City”) is affected or likely to be affected by a public calamity, subject to confirmation by the City Council at the earliest practicable time; and
WHEREAS, on December 30 and 31st, 2022, the City experienced an atmospheric river storm rain event, followed by another powerful storm event on January 4 and 5th, 2023 (the “2022/2023 Winter Storms”). As a result of the 2022/2023 Winter Storms, flooding, debris from trees, and mud impacted the San Lorenzo River and adjacent areas, including the Tannery area, San Lorenzo Park, and the beach. The San Lorenzo River reached 22.1 feet.

Rainfall amounts exceeded 7 inches in the mountains over a 24-hour period. The 2022/2023 Winter Storms resulted in flooding, downed trees, major infrastructure damage, and impacts to persons experiencing homelessness; and
WHEREAS, the County of Santa Cruz proclaimed the existence of a local emergency in the County on January 3, 2023 in response to the 2022/2023 Winter Storms; and WHEREAS, in light of the 2022/2023 Winter Storms and pursuant to his authority as Emergency Services Director, on January 4, 2023, the City Manager declared the existence of a local emergency (the “2022/2023 Emergency Proclamation”). At its January 10, 2023 meeting, the City Council adopted Resolution No. NS-30,085 declaring the existence of a State of Emergency in connection with the 2022/2023 Winter Storms, confirming the 2022/2023 Emergency Proclamation; and
WHEREAS, the City Council has continued to review the need for the 2022/2023 Winter Storms emergency declaration and most recently adopted Resolution No. NS-30,569 at its November 18, 2025 regular meeting, further extending the declaration of emergency by 60 days; and

8.3 RESOLUTION NO. NS-XX,XXX
2 WHEREAS, a year after the 2022/2023 Winter Storms, on December 28 and 30th, 2023, the City of Santa Cruz experienced a large winter swell event involving significant rain and hazardous ocean conditions, causing an estimate of $2.5 million in damage along West Cliff Drive and the Santa Cruz Wharf, followed by atmospheric river storms throughout January and February 2024 (the “2023/2024 Winter Storms”). The 2023/2024 Winter Storms included significant rainfall on January 22, 2024 that contributed to flooding within the City and specifically to Cypress Point Apartments; and
WHEREAS, on January 30, 2024, the County of Santa Cruz Board of Supervisors ratified the existence of a Local Emergency for the December 2023 Coastal Storms, as proclaimed by the County Administrative Officer as the Director of Emergency Services on January 3, 2024; and WHEREAS, in light of the 2023/2024 Winter Storms and pursuant to his authority as Emergency Services Director, on February 6, 2024, the City Manager declared the existence of a local emergency (the “2023/2024 Emergency Proclamation”). At its February 13, 2024 meeting, the City Council adopted Resolution No. NS-30,286 declaring the existence of a State of Emergency in connection with the 2023/2024 Winter Storms, confirming the 2023/2024 Winter Storms Emergency Proclamation; and
WHEREAS, the City Council has continued to review the need for the 2023/2024 Winter Storms emergency declaration and most recently adopted Resolution No. NS-30,569 at its November 18, 2025 regular meeting, further extending the declaration of emergency by 60 days; and
WHEREAS, at its September 10, 2024 regular meeting the City Council received an update from the Director of Public Works on the City’s response to the 2022/2023 and 2023/2024 Winter Storms. The City’s emergency response and recovery efforts remain ongoing and could continue into Summer 2026.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Cruz (City Council) as follows:

A. That the City Council hereby declares that the local emergency declaration adopted at its January 10, 2023 regular meeting by Resolution No. NS-30,085, and extended on January 24, 2023 by Resolution NS-30,095, on March 14, 2023 by Resolution NS-30,116, on May 9, 2023 by Resolution NS-30,145, on June 27, 2023 by Resolution NS-30,166, on August 22, 2023 by Resolution NS-30,187, on October 10, 2023 by Resolution NS-30,208, on November 28, 2023 by Resolution NS-30,239, on January 23, 2024 by Resolution NS-30,274, on March 12, 2024 by Resolution NS-30,296, on April 30, 2024 by Resolution NS-30,315, on June 25, 2024 by Resolution NS-30,349, on August 13, 2024 by Resolution NS-30,362, on October 8, 2024 by Resolution NS30,393, on December 10, 2024 by Resolution NS-30,414, on January 28, 2025 by Resolution NS-30,428, on March 25, 2025 by Resolution NS-30,452, on May 13, 2025 by Resolution NS-30,479, on June 24, 2025 by Resolution NS-30,517, on August 12, 2025 by Resolution NS-30,533, on September 30, 2025 by Resolution NS-30,552, and on November 18, 2025 by Resolution NS-30,569, shall be extended

8.4 RESOLUTION NO. NS-XX,XXX
3 an additional sixty (60) days from the date of this resolution pursuant to California Government Code Section 8630, et seq.; and
B. That the City Council hereby declares that the local emergency declaration adopted at its February 13, 2024 regular meeting by Resolution NS-30,286, and extended on April 9, 2024 by Resolution NS-30,311, on April 30, 2024 by Resolution NS-30,315, on June 25, 2024 by Resolution NS-30,349, on August 13, 2024 by Resolution NS30,362, on October 8, 2024 by Resolution NS-30,393, on December 10, 2024 by Resolution NS-30,414, on January 28, 2025 by Resolution NS-30,428, on March 25, 2025 by Resolution NS-30,452, on May 13, 2025 by Resolution NS-30,479, on June 24, 2025 by Resolution NS-30,517, on August 12, 2025 by Resolution NS30,533, on September 30, 2025 by Resolution NS-30,552, and on November 18, 2025 by Resolution NS-30,569, shall be extended an additional sixty (60) days from the date of this resolution pursuant to California Government Code Section 8630, et seq.; and
C. This Resolution shall remain in full force and effect and shall thereafter terminate on the sixtieth (60th) day after its adoption, unless earlier terminated or further extended by subsequent City Council action.

PASSED AND ADOPTED this 13th day of January 2026 by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED: ______________________________
Fred Keeley, Mayor
ATTEST: ________________________________
Bonnie Bush, City Clerk Administrator

8.5 City Council

AGENDA REPORT
DATE: 12/24/2025
AGENDA OF: 01/13/2026
DEPARTMENT: City Attorney/City Manager
SUBJECT: Resolution Extending the Emergency Declaration in Connection with the December 2024 Municipal Wharf Emergency (CA/CM)
LOCATION: District 4
RECOMMENDATION: Motion to adopt a resolution extending by sixty days the Local Emergency Declaration in connection with the December 2024 Municipal Wharf emergency.

BACKGROUND: On December 23, 2024, at approximately 12:45 p.m., approximately 180 ft. at the southernmost end of the Santa Cruz Municipal Wharf collapsed into the ocean following a historic wave event. The collapsed section, which had been damaged in the 2023/2024 Winter Storms, was under construction for repairs at the time of the collapse. As a result of the damage, the Wharf, Cowell Beach, and Main Beach were temporarily closed out of an abundance of caution for public safety. On December 24, 2024, the City Manager issued a “Proclamation of Existence of Local Emergency.” The City Manager re-issued the Proclamation of Existence of Local Emergency on December 31, 2024, and January 7, 2025.

On June 6 - 8, 2025, the City, in coordination with the United States Coast Guard and Power Engineering Construction Company, conducted operations to remove heavy equipment and debris from the sea floor adjacent to the Wharf. The City’s debris cleanup efforts continued through Summer 2025. While initial repairs to the Wharf have been completed, conditions resulting from the December 2024 storm event continue to require additional repair and stabilization efforts, including implementation of the Wharf End Interim Repairs Project, which commenced in November 2025 to repair the southern end of the Wharf’s storm-damaged infrastructure, reduce vulnerability to additional storm impacts, and protect public health and safety. The Wharf Interim Repairs Project is anticipated to continue into February 2026.

DISCUSSION: Government Code section 8630 authorizes a governing body of a city or an official designated by ordinance to proclaim the existence of a local emergency. Santa Cruz Municipal Code section 2.20.030 empowers the Director of Emergency Services to proclaim the existence or threatened existence of a local emergency when the City is affected or likely to be affected by a public calamity or disaster, subject to confirmation by the City Council at the “earliest practicable time.” During the existence of such emergency, the Director of Emergency Services is also authorized, pursuant to Section 2.20.040(1), to “[m]ake and issue rules and regulations on matters reasonably related to the protection of life and property as affected by

9.1 such emergency,” also subject to confirmation by the City Council “at the earliest practicable time.”
Due to the circumstances described above, the City Manager declared the existence of a local emergency in the City of Santa Cruz on December 24, 2024, and declared the continued existence of a local emergency on December 31, 2024, and January 7, 2025. The City Council ratified the emergency declaration by Resolution No. NS-30,423 at its January 14, 2025 regular meeting.

The attached resolution, if adopted by the City Council, would extend the emergency declaration related to the December 2024 Wharf emergency by an additional 60 days, to March 14, 2026.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed Council action is not a “project” under CEQA because it will not “cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment.” (Pub. Resources Code, § 21065.)
HEALTH IN ALL POLICIES (HiAP): This action is consistent with the three pillars of HiAP.

Specifically, the pillars of public health and sustainability in that the resolution is intended to aid the City in clean up and recovery efforts to protect the environment and public health and safety along the Wharf and City beaches.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: None.

Prepared By:

Kaylen Anderson
Deputy City Attorney
Submitted By:

Cassie Bronson
City Attorney
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

9.2 RESOLUTION NO. NS-XX,XXX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ EXTENDING

THE LOCAL EMERGENCY DECLARATION IN CONNECTION WITH THE DECEMBER 2024 WHARF EMERGENCY
WHEREAS, Government Code section 8630 authorizes the City Council or an official designated by ordinance to proclaim the existence of a local emergency; and WHEREAS, Santa Cruz Municipal Code section 2.20.030 empowers the City Manager, as the director of emergency services, to proclaim the existence or threatened existence of a local emergency when the City of Santa Cruz (“City”) is affected or likely to be affected by a public calamity, subject to confirmation by the City Council at the earliest practicable time; and WHEREAS, on December 23, 2024, at approximately 12:45 p.m., the City experienced a high surf event causing approximately 180 feet of a section of the Santa Cruz Municipal Wharf (the “Wharf”) to collapse into the ocean; and
WHEREAS, the City temporarily closed the remaining portions of the Wharf, Cowell Beach, and Main Beach to ensure the safety of the public. The Wharf remained closed for nearly two weeks, significantly impacting small businesses; and WHEREAS, damage to the Wharf is significant and is estimated at over $18 million. While initial repairs have been completed to restore the Wharf’s structural integrity and functionality, the City’s emergency response to the December 2024 Wharf Emergency is ongoing as City staff continues to address the damage to the Wharf; and
WHEREAS, on June 6, 7, and 8, 2025, the City coordinated with the United States Coast Guard and Power Engineering Construction Company to remove heavy equipment and debris from the sea floor adjacent to the Wharf, which remained in the ocean and posed a potential threat to the shoreline and vessels on the water until their removal; and WHEREAS, debris from the Wharf remained along the California coastline, requiring continued cleanup efforts at impacted sites through Summer 2025, including the Santa Cruz Harbor and Corcoran Lagoon; and
WHEREAS, in response to damage caused by the December 2024 storm event, the City initiated the Wharf End Interim Repairs Project in November 2025 to repair and stabilize the southern end of the Wharf and reduce the risk of further storm-related damage, and the project is anticipated to continue into February 2026; and
WHEREAS, as a result of the incident at the Wharf, the City Manager, as the director of emergency services, declared the existence of a local emergency on December 24, 2024, and declared the continued existence of a local emergency on December 31, 2024, and January 7, 2025; and

9.3 RESOLUTION NO. NS-XX,XXX
2 WHEREAS, at its January 14, 2025 meeting, the City Council adopted Resolution No.

NS-30,423 declaring the existence of a State of Emergency in connection with the December 2024 Wharf Emergency, confirming the December 24, 2024, December 31, 2024, and January 7, 2025 Emergency Proclamations by the City Manager, as the director of emergency services; and
WHEREAS, on February 14, 2025, Gavin Newsom, Governor of the State of California, proclaimed the existence of a state of emergency in the County of Santa Cruz due to the December 2024 winter storm that resulted in damage to the Wharf, further highlighting the significant impact of the storm and resulting damage.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Santa Cruz (City Council) as follows:

A. That the City Council hereby declares that the local emergency declaration adopted at its January 14, 2025 regular meeting by Resolution No. NS-30,423, and extended on March 11, 2025 by Resolution NS-30,447, on April 22, 2025 by Resolution NS30,460, on June 10, 2025 by Resolution NS-30,504, on June 24, 2025 by Resolution NS-30,518, on August 12, 2025 by Resolution NS-30,532, on September 30, 2025 by Resolution NS-30,553, and on November 18, 2025 by Resolution NS-30,570, shall be extended an additional sixty (60) days from the date of this resolution pursuant to California Government Code Section 8630, et seq.; and
B. This Resolution shall remain in full force and effect and shall thereafter terminate on the sixtieth (60th) day after its adoption, unless earlier terminated or further extended by subsequent City Council action.

PASSED AND ADOPTED this 13th day of January 2026 by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED: ______________________________
Fred Keeley, Mayor
ATTEST: ___________________________________
Bonnie Bush, City Clerk Administrator

9.4 MINUTES ARE UNOFFICIAL UNTIL APPROVED BY COUNCIL
City of Santa Cruz
809 Center Street
Santa Cruz, California 95060

MINUTES OF A CITY COUNCIL MEETING
December 9, 2025
11:30 AM
Mayor Keeley opened the City Council Closed Session at 11:32 a.m. in a public meeting via Zoom and in Council Chambers, for the purpose of announcing the agenda, and receiving public testimony.

Roll Call

Present: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

Absent: None.

Staff: City Manager M. Huffaker, City Attorney T. Condotti, Deputy City Clerk Administrator J. Wood, City Clerk Administrator B. Bush.

Statements of Disqualification – Mayor Keeley announced he will be recusing himself from item 34 as he lives near the project.

Public Comment
Mayor Keeley opened the public comment period at 11:34 a.m. There were no speakers. Mayor Keeley closed the public comment period at 11:35 a.m., at which time the meeting was closed to the public and Council adjourned to the Courtyard Conference Room.

10.1 December 9, 2025 CITY COUNCIL MINUTES 8113
Closed Session

1. Conference With Legal Counsel – Liability Claims (Government Code §54956.95) 1) Claimant: Leonardo J. Morelli
2) Claimant: Subroclaims, Inc. – Geico Insurance
Claims against the City of Santa Cruz
Council received a status report, took up under agenda item 20, and no reportable action was taken.

2. Conference With Legal Counsel – Anticipated Litigation (Gov’t. Code §54956.9(d)(2))
Significant exposure to litigation (one potential case to be discussed) Council received a status report, and no reportable action was taken.

3. Conference with Labor Negotiators (Government Code §54957.6) Supervisors, OE3
Police Officers Association
City Negotiator - Sara De Leon
Council received a status report from the City Negotiator, and no reportable action was taken.

4. Public Employee Performance Evaluation/Conference with Labor Negotiators (Government Code §54957, §54957.6)
Unrepresented employee: City Manager
Agency designated representative: City Attorney
No reportable action was taken.

10.2 December 9, 2025 CITY COUNCIL MINUTES 8114
City of Santa Cruz
809 Center Street
Santa Cruz, California 95060

MINUTES OF A CITY COUNCIL MEETING
December 9, 2025
1:30 PM
Call to Order – Mayor Keeley called the meeting to order at 1:34 p.m. in Council Chambers.

Roll Call

Present: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

Absent: None.

Staff: City Manager M. Huffaker, City Attorney T. Condotti, Deputy City Manager and Director of Economic Development and Housing B.

Lipscomb, Director of Public Works N. Nguyen, Director of Planning and Community Development L. Butler, Director of Parks and Recreation T.

Elliot, Chief of Fire R. Oatey (via Zoom), Director of Water H.

Luckenbach (via Zoom), Superintendent of Resource Recovery B. Nelson, Director of Homelessness Response and Community Programs L.

Imwalle, Associate Planner II E. Dhakni, Senior Planner T. Maier, Urban Forester L. Keedy, Deputy City Clerk Administrator J. Wood, City Clerk Administrator B. Bush.

Oral Communications - The Mayor provided a brief announcement about Oral Communications.

At 1:35 p.m. Mayor Keeley opened Oral Communications for members of the public who wished to speak regarding items not listed on the City Council agenda.

Unidentified person spoke regarding the data insecurity of the cameras utilized by FLOCK.

Julia Monahan spoke regarding FLOCK, stating the system is not one that can be made safe.

Angelee Dion spoke regarding FLOCK cameras, pointing out they are funded by Department of Homeland Security and does not feel they make our community more safe or secure.

10.3 December 9, 2025 CITY COUNCIL MINUTES 8115
Oral Communications (continued)
Darius Mohsenin spoke regarding a letter of authority that needs to be notarized annually and provided to the Police Department as the owner of apartment building in order for apartment owners to allow Police to enter the premises.

Sean Dougherty spoke regarding the FLOCK cameras, and explained he does not feel any safer with them in the community.

Sage spoke regarding the FLOCK cameras and asked for answers from Council about why action was not being taken at today’s meeting.

Unidentified person spoke regarding the FLOCK cameras, thanked Council for receiving and reviewing the data, and requested they cover the cameras in the meantime.

Andrew Davis spoke regarding FLOCK cameras, stating the data is unnecessary and there is no real justification for them now.

Unidentified person spoke regarding FLOCK cameras, in opposition to surveillance in the community, and stated the people of Santa Cruz are relying on Council to protect its citizens.

Keith spoke regarding films he will be showing at London Nelson, and in opposition to the use of FLOCK cameras.

Unidentified person spoke regarding homelessness and asked where all the homeless people have gone.

Catherine Hedges spoke regarding FLOCK, asking Council to cancel their contract and cover the cameras in the meantime.

Michael Spadafora spoke regarding the construction on the Murray Street Bridge.

Unidentified person spoke regarding a list of items not on the agenda that he thinks should have been agendized, including emergency local shelter.

Unidentified person spoke regarding FLOCK cameras, and the difference of making a choice and not making a choice.

Troy Mason spoke regarding wanting to be happy and wanting people around him to be happy.

Greg Bengston spoke regarding waking up indoors, being able to swim in the ocean, and loving Santa Cruz.

10.4 December 9, 2025 CITY COUNCIL MINUTES 8116
Oral Communications (continued)
Garrett spoke regarding government surveillance and expressed he is not a fan of government surveillance, but he wants Council to consider if we were to ever need the support of the Department of Homeland Security.

Unidentified person spoke regarding “sweeps” happening on the main homelessness encampments right before point-and-time counts, ruining their accuracy.

At 2:05 p.m. Mayor Keeley closed Oral Communications.

Presentations

5. Mayoral Proclamation Declaring December 18, 2025, as Bob Nelson Day Vice Mayor Kalantari-Johnson read from a proclamation declaring December 18, 2025, as Bob Nelson Day. Superintendent of Resource Recovery B. Nelson accepted the proclamation and spoke.

6. Mayoral Proclamation Declaring November 30, 2025, as Santa Cruz Roller Palladium Day
Councilmember Brunner read from a proclamation declaring November 30, 2025, as Santa Cruz Roller Palladium Day. Diane Ethrington accepted the proclamation and spoke.

Mayoral Proclamation Declaring December 18, 2025, as Tony Condotti Day Mayor Keeley read from a proclamation declaring December 18, 2025, as Tony Condotti Day. City Attorney T. Condotti accepted the proclamation and spoke.

Presiding Officer's Announcements
Statements of Disqualification – Mayor Keeley announced at the beginning of Closed Session that he will be recusing himself from item 34 as he lives next door to the project.

Additions and Deletions – None.

City Attorney Report on Closed Session – See page 8113 for the report.

10.5 December 9, 2025 CITY COUNCIL MINUTES 8117
Council Meeting Calendar

7. The City Council reviewed and did not revise the meeting calendar attached to the agenda.

Consent Agenda
Director of Homelessness Response and Community Programs L. Imwalle responded to Council questions regarding items 11 and 13.

Councilmember Brunner made a comment on items 13 and 23.

Vice Mayor Kalantari-Johnson made a comment on items 11, 13, and 25.

Councilmember O’Hara made a comment on items 10, 11, 13, 17, 25, and 27.

Councilmember Golder echoed Vice Mayor Kalantari-Johnson’s comments on items 11, 13, and 25.

Mayor Keeley made a comment on items 11 and 17.

Mayor Keeley opened the public comment period. The following people spoke:

Karen Warren spoke regarding item 11.

Unidentified person spoke regarding item 11.

Athena spoke regarding item 11.

Marilyn Patton spoke regarding item 11.

Unidentified person spoke regarding item 11.

Unidentified person spoke regarding item 8.

Unidentified person spoke regarding item 11.

Rick Longinotti spoke regarding item 19.

Mayor Keeley closed the public comment period.

10.6 December 9, 2025 CITY COUNCIL MINUTES 8118
Consent Agenda (continued)
MOTION: Councilmember O’Hara moved, seconded by Councilmember Golder, to approve the Consent Agenda with the following amendments to items 10 and 11:

Amend item 10 to add the following section to the agreement:
“15. Annual Performance Review. The Law Firm acknowledges that the City will endeavor to conduct an annual performance review of contracted services as part of its broader management practices. The Law Firm agrees to participate in this review process. The results of the City’s annual performance may be considered by the City, in its discretion, when determining whether to renew this Agreement.”
Amend #1 of the motion for item 11:
1) Direct staff to collaborate with the County to form a working group comprised of City and County staff, with participation of the Mayor and 3rd District County Supervisor or their designee, to be tasked with exploring and evaluating options for providing and funding basic hygiene access and other day services to support those experiencing homelessness in our community; Deputy City Manager and Director of Economic Development B. Lipscomb responded to Council questions regarding item 19.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

8. Minutes of the November 18, 2025 City Council Meeting (CC) LOCATION: None
Motion carried to approve as submitted.

Consent Agenda (continued)

9. Certification of the November 4, 2025 Election (CC)
LOCATION: Citywide

10.7 December 9, 2025 CITY COUNCIL MINUTES 8119
Resolution No. NS-30,582 was adopted confirming and approving the canvass of ballots and returns for the City of Santa Cruz election held on November 4, 2025, and declaring that Measure C (Workforce Housing Affordability Act of 2025) passed by a majority vote of the electorate of the City.

10. Contract for City Attorney Services (CM)
LOCATION: Citywide
Motion carried to approve the agreement for City Attorney legal services commencing January 1, 2026 with the following addition:
“15. Annual Performance Review. The Law Firm acknowledges that the City will endeavor to conduct an annual performance review of contracted services as part of its broader management practices. The Law Firm agrees to participate in this review process. The results of the City’s annual performance may be considered by the City, in its discretion, when determining whether to renew this Agreement.”

11. Day Services (CM)
LOCATION: Citywide
Motion carried to:
1) Direct staff to collaborate with the County to form a working group comprised of City and County staff, with participation of the Mayor and 3rd District County Supervisor or their designee, to be tasked with exploring and evaluating options for providing and funding basic hygiene access and other day services to support those experiencing homelessness in our community;
2) Authorize staff to solicit proposals for day services from qualified vendors through an open procurement process in collaboration with the County; and 3) Direct staff to return to the City Council with an update and recommended actions on or before February 28, 2026.

10.8 December 9, 2025 CITY COUNCIL MINUTES 8120
Consent Agenda (continued)

12. Approve Memorandums of Understanding with Haven Energy to Submit Applications to the California Self Generation Incentive Program with the Intent to Install and Operate Battery Storage Infrastructure at City Facilities (CM)
LOCATION: Districts 4 and 5
Motion carried to authorize the City Manager to execute Memorandums of Understanding with Haven Energy, proceed with submitting applications to the California Self Generation Incentive Program and, if accepted, develop agreements with Haven Energy to install and operate battery storage at City facilities, returning to City Council for authorization to execute such agreements.

13. Amend Contract to Encompass Community Services for Downtown Outreach Worker (DOW) Program - Budget Adjustment (CM)
LOCATION: District 4
Motion carried to:
 Amend the existing agreement with Encompass Community Services (Encompass) for the Downtown Outreach Worker (DOW) Program by extending the term through June 30, 2026, and increasing the amount of the contract by $202,948, for a total not to exceed $378,876, and to authorize the City Manager to execute an agreement in a form approved by the City Attorney. The Director of Homelessness Response and Community Programs is authorized to execute change orders within the approved budget; and
 Adopt Resolution No. NS-30,583 amending the FY 2026 budget to appropriate $202,948 to extend the DOW Program contract with Encompass from January 1, 2026 - June 30, 2026.

10.9 December 9, 2025 CITY COUNCIL MINUTES 8121
Consent Agenda (continued)

14. Authorization to Submit a Grant Application to the California State Coastal Conservancy (SCC) for Construction of the Jessie Street Marsh Restoration and Access Project (CM)
LOCATION: Districts 2 and 4
Resolution No. NS-30,584 was adopted authorizing the City Manager to apply for, accept, appropriate, and execute all necessary applications, contracts, agreements, and amendments for a grant of up to $2 million from the California State Coastal Conservancy (SCC) to support construction of the Jessie Street Marsh Restoration and Access Project.

15. California Volunteers Youth Service Corps Grant (CM) LOCATION: Citywide
Motion carried to:
 Adopt Resolution No. NS-30,585 authorizing the City Manager to apply for, accept, appropriate, and execute agreements for the California Volunteers Youth Service Corps grant.
 Adopt a finding of Categorical Exemption pursuant California Environmental Quality Act (CEQA) Guidelines: Section 15307 (maintenance, restoration, or enhancement of a natural resource), Section 15308 (maintenance, restoration, or enhancement of the environment), and Section 15061(b)(3) (“common sense” exemption).

16. Fifth Amendment to the Professional Services Agreement with OIR Group for Independent Police Auditor Services (CM/PD)
LOCATION: Citywide
Motion carried to approve the Fifth Amendment to the Professional Services Agreement with OIR Group, LLC for Independent Police Auditor (IPA) services, extending the term through June 30, 2027, updating the Scope of Work and Fee Schedule, and authorizing the City Manager to execute the amendment.

10.10 December 9, 2025 CITY COUNCIL MINUTES 8122
Consent Agenda (continued)

17. Request for Evaluation and Streamlining of City Advisory Bodies and Committees (CN)
LOCATION: Citywide
Motion carried to direct staff to develop a recommended approach for evaluating and streamlining the City’s system of advisory bodies, commissions, standing committees, and ad hoc Council committees. This approach should include:
 A proposed scope of work;
 A recommended methodology and timeline;
 Consideration of consultant support;
 Estimated cost of the evaluation effort; and
 5) A plan for returning to Council for approval prior to initiating the evaluation and streamlining review.

18. Award Contract for the Purchase of Vehicle Barriers and Related Materials (EDH)
LOCATION: Citywide
Motion carried to:
 Award a contract for the purchase of vehicle barriers and related materials from Meridian Rapid Defense Group LLC, in an amount not to exceed $178,654.69, via “piggybacking” the General Services Administration Schedule 84 Contract #47QSWA19D001F; and
 Adopt a finding of Categorical Exemption pursuant to CEQA Guidelines Sections: 15301 (Minor Alteration to Existing Structures and Facilities); 15302 (Replacement or Reconstruction of Existing Structures or Facilities); 15303 (New Construction, Installation, or Conversion of Limited Number of Small Structures, Facilities, Equipment); § 15304 (Minor Alteration to Land, Water, or Vegetation); and the Common Sense Exemption (§ 15061(b)(3)).

10.11 December 9, 2025 CITY COUNCIL MINUTES 8123
Consent Agenda (continued)

19. Resolution Approving the Infrastructure Financing Plan (IFP) for the Santa Cruz Enhanced Infrastructure Financing District (EIFD) and the Allocation of Property Tax Increment within the Santa Cruz EIFD (EDH) LOCATION: Citywide
Resolution No. NS-30,586 was adopted approving the Infrastructure Financing Plan (IFP) for the Santa Cruz Enhanced Infrastructure Financing District (EIFD) and the allocation of property tax increment within the Santa Cruz EIFD.

20. Liability Claims Filed Against the City of Santa Cruz (FN) Motion carried to reject the liability claims of 1) Leonardo J. Morelli and 2) Subroclaims, Inc. – Geico Insurance, based on staff recommendation.

21. FY 2025 Traffic Impact Fee Annual Report (FN/PW)
LOCATION: Citywide
Motion carried to accept and approve the attached FY 2025 Traffic Impact Fee Annual Report.

22. FY 2025 Parking In-Lieu Impact Fee Annual Report (FN/PW) LOCATION: Citywide
Motion carried to accept and approve the attached FY 2025 Parking In-Lieu Impact Fee Annual Report.

10.12 December 9, 2025 CITY COUNCIL MINUTES 8124
Consent Agenda (continued)

23. Resolution Directing Staff to Submit the Local Coastal Program Amendments Approved by City Council on November 18, 2025, Related to the Previously Approved General Plan 2030 Sensitive Habitat and Vegetation Maps and the Added Beaches and Bluffs Hazards Adaptation Chapter, to the California Coastal Commission (PL)
LOCATION: District 2, 3, 4, and 6
Motion carried to:
 Adopt Resolution No. NS-30,587 authorizing the City Manager or his designee to submit the amendments to the Local Coastal Program approved by City Council on November 18, 2025, to the California Coastal Commission for final certification; and
 Direct staff to submit the above resolution to the California Coastal Commission for certification, together with the amendments to the Local Coastal Program approved on November 18, 2025.

24. Murray Street Bridge Seismic Retrofit Construction Phase (c402519) – Contract Amendment 12 (PW)
LOCATION: District 2
Motion carried to approve Contract Amendment 12 to an agreement with TRC Engineers, Inc. (Rancho Cordova, CA) to provide design completion, final coordination and construction support services for the Murray Street Bridge Seismic Retrofit Project. The Public Works Director is authorized to approve future Contract Amendments within the approved project budget.

25. West Cliff Drive Stabilization Project - Notice of Completion (PW) LOCATION: District 6
Motion carried to accept the work of Granite Construction (Watsonville, CA), authorize the filing of the Notice of Completion for the West Cliff Stabilization Project (c401501), and authorize the Public Works Director to sign the Notice of Completion as the Owner’s Authorized Agent.

10.13 December 9, 2025 CITY COUNCIL MINUTES 8125
Consent Agenda (continued)

26. Adjustment of the City of Santa Cruz Water Department Miscellaneous Fees (WT)
LOCATION: County
Resolution No. NS-30,588 was adopted adjusting the City of Santa Cruz Water Department’s miscellaneous fees for services due to labor cost increases and rescinding Resolution No. NS-30,337.

27. Water Supply Augmentation, Beltz Well 10 Aquifer Storage and Recovery Pilot Test and Beltz 11 Injection Pilot Test, Pueblo Water Resources Professional Services Contract for Pilot Test Work Plan and Hydrogeology Support to Perform the Pilot Test (WT)
LOCATION: County
Motion carried to:
 Authorize the City Manager to execute an agreement in a form to be approved by the City Attorney with Pueblo Water Resources (PWR) of Ventura, CA in the amount of $455,910 to conduct pilot testing of Aquifer Storage and Recovery (ASR) at Beltz Well 10 and Beltz Well 11;  Authorize the Water Director, or designee, to execute amendments that are within the approved budget; and
 Adopt a finding of Categorical Exemption pursuant to Section 14 Cal Code Regs §15301 (Existing Facilities) and §15306 (Information Collection) of the California Environmental Quality Act (CEQA) Guidelines.

End Consent Agenda

10.14 December 9, 2025 CITY COUNCIL MINUTES 8126
At this time Mayor Keeley left the dais.

Consent Public Hearing
Vice Mayor Kalantari-Johnson opened the public comment period. The following person spoke:

Garrett
Vice Mayor Kalantari-Johnson closed the public comment period.

MOTION: Councilmember Golder moved, seconded by Councilmember O’Hara, to approve the Consent Public Hearing Agenda.

ACTION: The motion carried with the following vote.

AYES: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson.

NOES: None.

ABSENT: Mayor Keeley (items 28 - 33).

DISQUALIFIED: Mayor Keeley (item 34).

28. 2nd Reading and Final Adoption of Ordinance No. 2025-23 and Ordinance No. 2025-24 Amending the Municipal Code Title 21, Chapter 21.03 – Relocation Assistance for Displaced Tenants and Title 24, Chapter 24.08, Part 14 - Residential Demolition/Conversion Authorization Permits Related to Displacement of Tenants Due to Enforcement of Unsafe Living Conditions and Demolition of Housing (PL)
LOCATION: Citywide
Motion carried to:
 Adopt Ordinance No. 2025-23 amending Titles 21 and 24 of the Santa Cruz Municipal Code (SCMC) related to relocation assistance associated with substandard housing cases and right of first refusal and other minor changes related to demolition of housing;
 Adopt Ordinance No. 2025-24 amending the Local Coastal Program (LCP) Implementation Plan (IP) and Title 24 of the Municipal Code related to the approving body for demolition of three or more dwellings; and  Adopt Resolution No. NS-30,589 directing staff to submit Ordinance No. 2025-24 to the California Coastal Commission.

10.15 December 9, 2025 CITY COUNCIL MINUTES 8127
Consent Public Hearings (continued)

29. 2nd Reading and Final Adoption of Ordinance No. 2025-25 Adopting the 2025 Edition of the California Fire Code and Fire Code Standards, including Annual Supplements and State Amendments and Errata (FD)
LOCATION: Citywide
Ordinance No. 2025-25 was adopted amending the Santa Cruz Municipal Code Chapter 19.05 to adopt and incorporate by reference the 2025 edition of the California Fire Code and make other amendments and amend Santa Cruz Municipal Code Chapter 19.10.

30. 2nd Reading and Final Adoption of Ordinance No. 2025-26 Adopting the 2025 California Wildland-Urban Interface Code, including Annual Supplements and State Amendments and Errata (FD)
LOCATION: Citywide
Ordinance No. 2025-26 was adopted adding Santa Cruz Municipal Code Chapter

19.30 to adopt and incorporate by reference the 2025 California WildlandUrban Interface Code and make other amendments.

31. 2nd Reading and Final Adoption of Ordinance No. 2025-27 Amending Santa Cruz Municipal Code § 10.36.040 Pertaining to Medians (CN)
LOCATION: Citywide
Ordinance No. 2025-27 was adopted amending Santa Cruz Municipal Code (SCMC) § 10.36.040 pertaining to medians.

32. 2nd Reading and Final Adoption of Ordinance No. 2025-28 Amending Santa Cruz Municipal Code 5.82.120 Pertaining to Sidewalk Vending (CA) LOCATION: Citywide
Ordinance No. 2025-28 was adopted amending Santa Cruz Municipal Code (SCMC) 5.82.120 pertaining to sidewalk vending.

10.16 December 9, 2025 CITY COUNCIL MINUTES 8128
Consent Public Hearings (continued)

33. Tax and Equity Fiscal Responsibility Act (TEFRA) Hearing and Resolution regarding Conduit Financing for the 136 River Street Project (EDH) LOCATION: District 5
Conduct the public hearing under the requirements of Tax and Equity Fiscal Responsibility Act (“TEFRA”) and the Internal Revenue Code of 1986, as amended (the “Code”) and adopt Resolution No. NS-30,590 approving the issuance of tax-exempt multi-family rental housing revenue bonds in an amount not to exceed $30,000,000 (the “Bonds”), by the California Municipal Finance Authority (“CMFA”) for the benefit of 136 River Apartments Investors, L.P. (the “Borrower”), to provide for the financing of the multi-family rental housing project.

34. Tax and Equity Fiscal Responsibility Act (TEFRA) Hearing and Resolution regarding Conduit Financing for the 525 Water Street Project (EDH) LOCATION: District 1
Conduct the public hearing under the requirements of Tax and Equity Fiscal Responsibility Act (“TEFRA”) and the Internal Revenue Code of 1986, as amended (the “Code”) and adopt Resolution No. NS-30,591 approving the issuance of tax-exempt multi-family rental housing revenue bonds in an amount not to exceed $32,000,000 (the “Bonds”), by the California Municipal Finance Authority (“CMFA”) for the benefit of 525 Water Street LP (the “Borrower”), to provide for the financing of the multi-family rental housing project.

10.17 December 9, 2025 CITY COUNCIL MINUTES 8129
Public Hearings

35. No-Parking Street Sweeping Program and Street Sweeping Coastal Permit Project Number: CP25-0132 Coastal Permit for Continuation, in Perpetuity, of Limitation of Hours of Public Parking in Support of Ongoing Sweeping of City Streets in the Public Right-of-Way on Land Within the Shoreline Protection Overlay/Coastal Zone on Public Rights-of-Way Within the Coastal Zone, Including Potential Future Expansions of the Locations and Time of Parking Restrictions. Environmental Review: Not a Project Pursuant to CEQA Section 15378; Statutory Exemption: CEQA Guidelines Section 15282(j) (14 CCR Section 15282(j)). Categorical Exemption: CEQA Guidelines Sections 15301(c) and (g), 15307, 15308, and 15061(b) (14 CCR Sections 15301(c) and (g), 15307, 15308, and 15061(b).); Filed: 10/15/2025 by Applicant: City of Santa Cruz. This Coastal Permit is Appealable to the California Coastal Commission (PW/PL) LOCATION: Districts 1, 2, 5, and 6
Associate Planner II E. Dhakni and Senior Planner T. Maier gave a presentation.

Mayor Keeley opened the public comment period. There were no speakers.

Mayor Keeley closed the public comment period.

MOTION: Councilmember Golder moved, seconded by Vice Mayor Kalantari-Johnson, to:
 Adopt Resolution No. NS-30,592 formalizing and making permanent the NoParking Street Sweeping Pilot Program, allowing for continuation, in perpetuity, and future expansion of limitations on hours of public parking on lands in various locations throughout the City; and
 Adopt Resolution No. NS-30,593 acknowledging the environmental determination and approving a Coastal Permit (further to Application CP23- 0144) for continuation, in perpetuity, and future expansion of limitations on hours of public parking in support of ongoing sweeping of City streets in the public right-of-way on land within the Shoreline Protection Overlay/Coastal Zone, based on the attached Findings and Conditions of Approval.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

10.18 December 9, 2025 CITY COUNCIL MINUTES 8130
Council recessed at 3:08 p.m. and returned at 3:23 p.m.

Public Hearings (continued)

36. Tree Appeal – 401 Ingalls Street (Tree Removal Permit #TR25-0087) (PR) LOCATION: District 6
Urban Forester L. Keedy gave a presentation.

Appellant Gillian Greensite gave a presentation.

Applicant James Allen spoke.

Mayor Keeley opened the public comment period. The following people spoke.

Keith McHenry
Marv Lewis
Garrett
Mayor Keeley closed the public comment period.

Appellant Gillian Greensite gave a rebuttal.

MOTION: Councilmember O’Hara moved, seconded by Councilmember Golder, to adopt Resolution No. NS-30,594 to deny the appeal and uphold the Parks and Recreation Commission’s approval of heritage tree removal permit application TR25-0087 submitted by property owner James Allen to remove two Coast Redwood trees (Sequoia sempervirens) located at 401 Ingalls Street.

ACTION: The motion carried unanimously with the following vote.

AYES: Councilmembers Trigueiro, Brunner, Newsome, Golder, O’Hara; Vice Mayor Kalantari-Johnson; Mayor Keeley.

NOES: None.

ABSENT: None.

DISQUALIFIED: None.

10.19 December 9, 2025 CITY COUNCIL MINUTES 8131
Presentation

37. Election of Vice Mayor for 2026
Councilmember Golder nominated Vice Mayor Kalantari-Johnson to another term as Vice Mayor. By consensus, the City Council elected Vice Mayor Kalantari-Johnson to serve as Vice Mayor for 2026.

Adjournment – Councilmember Golder moved, seconded by Councilmember Trigueiro, to adjourn. By consensus City Council adjourned at 4:39 p.m.

Respectfully Submitted:

Julia Wood, Deputy City Clerk Administrator
Attest:

Bonnie Bush, City Clerk Administrator
Approved:

Fred Keeley, Mayor

10.20 City Council

AGENDA REPORT
DATE: 11/26/2025
AGENDA OF: 01/13/2026
DEPARTMENT: City Clerk
SUBJECT: Resolution Ordering an Election for Three Council Seats, Districts 4 and 6, and Mayor, for the June 2, 2026 Primary Election (CC)
LOCATION: Citywide
RECOMMENDATION: Motion to adopt a resolution ordering an election, requesting the County Elections Department to conduct the election, and requesting consolidation of the election with the June 2, 2026 Primary Election.

BACKGROUND: The terms for District 4 Councilmember, District 6 Councilmember, and Mayor will all be ending on December 31, 2026. Council elections are now held in a two round process, also known as runoff voting. Per the City Charter if, after the first round of elections, any one candidate receiving a majority of votes cast (50% +1) for the office they ran for shall be declared elected. If no one candidate receives a 50% +1 majority, the two candidates receiving the highest number of votes shall face each other in a runoff for that seat at the November General Election.

DISCUSSION: This resolution orders the City of Santa Cruz election for Districts 4 and 6, and Mayor, and requests that it be consolidated with the Primary Election on June 2, 2026.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed Council action is not a "project" under CEQA.

HEALTH IN ALL POLICIES (HiAP): This aligns with the HiAP Equity pillar as elections provide an opportunity for broad community engagement in local initiatives and policy decision.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: The total cost of the election is estimated to be in the range of $197,163 to $267,205 ($5 - $6 per voter), based on figures provided by the County Elections Department. This cost has already been accounted for in the FY 2026 budget.

11.1 Prepared By:

Bonnie Bush
City Clerk
Submitted By:

Michelle Templeton
Assistant City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESOLUTION.DOCX

11.2 RESOLUTION NO. NS-30,XXX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SANTA CRUZ ORDERING AN

ELECTION, REQUESTING COUNTY ELECTIONS TO CONDUCT THE ELECTION, AND

REQUESTING CONSOLIDATION WITH THE PRIMARY ELECTION IN THE CITY OF SANTA CRUZ ON JUNE 2, 2026
WHEREAS, pursuant to Elections Code Section 10002, the governing body of any city or district may by resolution request the Board of Supervisors of the county to permit the county elections official to render specified services to the city or district relating to the conduct of an election; and
WHEREAS, the resolution of the City Council of the city of Santa Cruz shall specify the services requested; and
WHEREAS, pursuant to Elections Code Section 10002, the city shall reimburse the county in full for the services performed upon presentation of a bill to the city; and WHEREAS, pursuant to Elections Code Section 10400, whenever two or more elections of any legislative or congressional district, public district, city, county, or other political subdivision are called to be held on the same day, in the same territory, or in territory that is in part the same, they may be consolidated upon the order of the governing body or bodies or officer or officers calling the elections; and
WHEREAS, pursuant to Elections Code Section 10400, such election for cities and special districts may be either completely or partially consolidated; and WHEREAS, pursuant to Elections Code Section 10403, whenever an election called by a district, city or other political subdivision for the submission of any question, proposition, or office to be filled is to be consolidated with a statewide election, and the question, proposition, or office to be filled is to appear upon the same ballot as that provided for that statewide election, the district, city or other political subdivision shall, at least 88 days prior to the date of the election, file with the board of supervisors, and a copy with the elections official, a resolution of its governing board requesting the consolidation, and setting forth the exact form of any question, proposition, or office to be voted upon at the election, as it is to appear on the ballot, acknowledging that the consolidation election will be held and conducted in the manner prescribed in Section 10418. Upon such request, the Board of Supervisors may order the consolidation; and
WHEREAS, pursuant to Elections Code Section 10418, if consolidated, the consolidated election shall be held and conducted, election boards appointed, voting precincts designated, candidates nominated, ballots printed, polls opened and closed, voter challenges determined, ballots counted and returned, returns canvassed, results declared, certificates of election issued, recounts conducted, election contests presented, and all other proceedings incidental to and connected with the election shall be regulated and done in accordance with the provisions of law regulating the statewide or special election, or the election held pursuant to Section 1302 or 1303, as applicable.

11.3 RESOLUTION NO. NS-30,
WHEREAS, the resolution requesting the consolidation shall be adopted and filed at the same time as the adoption of the ordinance, resolution, or order calling the election; and WHEREAS, various district, county, state and other political subdivision elections may be or have been called to be held on June 2, 2026;
NOW, THEREFORE, BE IT RESOLVED AND ORDERED that the City Council of the City of Santa Cruz hereby orders an election be called and consolidated with any and all elections also called to be held on June 2, 2026 insofar as said elections are to be held in the same territory or in territory that is in part the same as the territory of the City of Santa Cruz and requests the Board of Supervisors of the County of Santa Cruz to order such consolidation under Elections Code Sections 10401, 10403 and 10418.

BE IT FURTHER RESOLVED AND ORDERED that the City Council requests the Board of Supervisors to permit the Santa Cruz County Elections Department to provide any and all services necessary for conducting the election and agrees to pay for said services, and BE IT FURTHER RESOLVED AND ORDERED that the Santa Cruz County Elections Department conduct the election for the following offices on the June 2, 2026 ballot:

Seats open Office Term District/Division
1 Councilmember 4 years 4
1 Councilmember 4 years 6
1 Mayor 4 years At-large
PASSED AND ADOPTED this 13th day of January, by the following vote:

AYES:

NOES:

ABSENT:

DISQUALIFIED:

APPROVED: ________________________
Fred Keeley, Mayor
ATTEST: _______________________
Bonnie Bush, City Clerk Administrator

11.4 City Council

AGENDA REPORT
DATE: 11/26/2025
AGENDA OF: 01/13/2026
DEPARTMENT: City Clerk
SUBJECT: Appointment of Representatives to External Agencies, Groups, Council Committees and Task Forces (CC)
LOCATION: Citywide
RECOMMENDATION: Motion to approve Mayor Keeley’s nominations to external agencies, groups, and City Council committees and task forces for the 2026 calendar year.

BACKGROUND: Each year, the Mayor presents a list of proposed appointments to represent the City of Santa Cruz (City) on a variety of boards, committees and groups both internally and externally. The nominations are presented for City Council review and official appointment.

DISCUSSION: Council must review Mayor Keeley's nominations and, by motion, approve official appointments.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed Council action is not a "project" under CEQA.

HEALTH IN ALL POLICIES (HiAP): Not applicable.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: No impacts.

Prepared and Submitted By:

Bonnie Bush
City Clerk
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. DRAFT 2026 COUNCIL MEMBERSHIP IN CITY GROUPS AND OUTSIDE AGENCIES – TRACK CHANGES.PDF

2. DRAFT 2026 COUNCIL MEMBERSHIP IN CITY GROUPS AND OUTSIDE AGENCIES - CLEAN.DOCX

12.1 Council Membership in City Groups and Outside Agencies (2026) ***Draft*** Councilmembers may provide direction, request additional information or that a topic raised be agendized for future Council action. The Presiding Officer may request oral updates from Council Ad Hoc Committees.

City Council Standing Committees Assigned Staff
Public Safety Golder, Brunner, O’Hara Emeline Nguyen
Health in All Policies Committee Brunner, Kalantari-Johnson, Trigueiro Tiffany Wise-West Council Appointment to Advisory Body Assigned Staff
City of Santa Cruz Children’s Fund
Oversight Committee
Kalantari-Johnson Gina Liebig
City Council Ad Hoc Committees Assigned Staff
Sugar-sweetened Beverage Tax Trigueiro, Brunner, Kalantari-Johnson Michelle Templeton Council Ad Hoc Budget and Revenue
Committee
Mayor Keeley, Newsome, Golder Elizabeth Cabell
Michelle Templeton
Council Ad Hoc Housing Subcommittee Mayor KeeleyO’Hara, Kalantari-Johnson, Newsome
Lee Butler, Bonnie Lipscomb
Comprehensive Wildfire Preparedness and
Safety Program Committee
O’Hara, Trigueiro, Golder Meredith Albert, Tim Shields
Enhanced Infrastructure Financing District
Public Finance Authority
Mayor Keeley, Vice Mayor Kalantari-Johnson,
Newsome. Alternate: O’Hara
Brian Borguno
Murray Street Bridge Ad-Hoc Committee Brunner, Trigueiro, Kalantari-JohnsonMayor Keeley
Nathan Nguyen, Bonnie Lipscomb, Kevin
Crossley, Rebecca Unitt, Ashley Hussey
CORE O’Hara, Trigueiro, Kalantari-Johnson Larry Imwalle External Governmental Agencies/Intergovernmental Coordinating Committees Assigned Staff Association of Monterey Bay Area
Governments (AMBAG)
Newsome, O’Hara (Alternate) Lee Butler
City Select Committee Mayor Keeley Matt Huffaker
Library Financing Authority Brunner, O’Hara (alternate) Matt Huffaker Santa Cruz County Housing for Health
Partnership (H4HP) Policy Board
Kalantari-Johnson, O’Hara Larry Imwalle
Monterey Bay Air Resources District (City
Nominee)
O’Hara nominated. County Select Committee
did not appoint.

Tiffany Wise-West
Central Coast Community Energy Policy
Board
Central Coast Community Energy
Operations Board
Mayor Keeley, Golder (Alternate)
Matt Huffaker, Tiffany Wise-West (alternate)
Matt Huffaker
Santa Cruz County Integrated Waste
Management Local Task Force
Newsome, Golder (Alternate) Bob Nelson, Leslie O’Malley (staff alternate) Santa Cruz Metropolitan Transit District
Board (METRO)
Kalantari-Johnson, Newsome Claire Gallogly
Santa Cruz County Regional Transportation
Commission (RTC)
Mayor Keeley, Newsome (Alternate) Nathan Nguyen , Claire Gallogly (alternate)

12.2 External Governmental Agencies/ Intergovernmental Coordinating Committees (cont) Assigned Staff Santa Cruz Mid-County Groundwater
Agency
O’Hara, Former Water Commissioner David
Baskin, Water Commissioner Doug Engfer
(alternate)
Heidi Luckenbach
Santa Margarita Groundwater Agency Water Commissioner Doug Engfer, O’Hara (alternate)
Heidi Luckenbach
Local Agency Formation Commission
(LAFCO) (alternate until May 2027)
Mayor Keeley Matt Huffaker
Joint Powers Authorities/City Groups Staff Appointments Agency Contact Information Santa Cruz County Animal Services
Authority
Michelle Templeton, Jon BushTBD Santa Cruz County Animal Services Authority 2200 7th Avenue
Santa Cruz, CA 95062
https://www.scanimalshelter.org/
Santa Cruz Public Libraries Matt Huffaker Santa Cruz Public Libraries 117 Union Street
Santa Cruz, CA 95060
https://www.santacruzpl.org/
Santa Cruz Regional 9-1-1 Matt Huffaker Santa Cruz Regional 9-1-1 495 Upper Park Rd.

Santa Cruz, CA 95065
(831) 471-1000
External Community Organizations Councilmember/Staff Agency Contact Information Area Agency on Aging (AAA) Advisory
Council
Trigueiro, O’Hara (Council alternate), Rita
Hester (citizen alternate)
Seniors Council, Clay Kempf
234 Santa Cruz Ave.

Aptos, CA 95003
Phone: (831) 688-0400
Arts Council of Santa Cruz County Brunner Jim Brown, Executive Director 1070 River Street
Santa Cruz, CA 95060
[email protected]
831-475-9600 X 25
Climate Action Task Force Mayor Keeley Tiffany Wise-West [email protected]
Community Action Board (CAB) Newsome, Eve Bertram, UCSC Professor (alternate)
Community Action Board of Santa Cruz
County, Inc.
406 Main St. STE 207
Watsonville, CA 95076
831-763-2147
Cowell Working Group Golder, Tony Elliot (staff) CWG Facilitated by Save the Waves Downtown Management Corporation Kalantari-Johnson, Newsome, Bonnie Lipscomb (staff)
Downtown Management Corporation
[email protected]
337 Locust Street,
Santa Cruz, CA 95060
Santa Cruz County Youth Action Network Trigueiro [email protected] United Way of Santa Cruz County
4450 Capitola Rd, Ste 106
Capitola, CA 95010
Santa Cruz Community Farmers’ Market Kalantari-Johnson, Trigueiro (Alternate) Bonnie Lipscomb (staff)
Nesh Dillon Executive Director SCCFM
P.O. Box 8189
Santa Cruz, CA 95061
Thrive by 5 Advisory Committee Trigueiro David Brody [email protected] Executive Director, First 5 Santa Cruz County
4450 Capitola Road, Suite 106, Capitola, CA
95010
Visit Santa Cruz County O’HaraTrigueiro, Brunner, Bonnie Lipscomb (staff)
Visit Santa Cruz County
303 Water Street, Suite 100
Santa Cruz, CA 95060
800-833-3494 or 831-425-1234

12.3 Council Membership in City Groups and Outside Agencies (2026) ***Draft*** Councilmembers may provide direction, request additional information or that a topic raised be agendized for future Council action. The Presiding Officer may request oral updates from Council Ad Hoc Committees.

City Council Standing Committees

Assigned Staff
Public Safety Golder, Brunner, O’Hara Emeline Nguyen
Health in All Policies Committee Brunner, Kalantari-Johnson, Trigueiro Tiffany Wise-West Council Appointment to Advisory Body

Assigned Staff
City of Santa Cruz Children’s Fund
Oversight Committee
Kalantari-Johnson Gina Liebig
City Council Ad Hoc Committees Assigned Staff
Sugar-sweetened Beverage Tax Trigueiro, Brunner, Kalantari-Johnson Michelle Templeton Council Ad Hoc Budget and Revenue
Committee
Mayor Keeley, Newsome, Golder Elizabeth Cabell
Michelle Templeton
Council Ad Hoc Housing Subcommittee O’Hara, Kalantari-Johnson, Newsome Lee Butler, Bonnie Lipscomb Comprehensive Wildfire Preparedness and
Safety Program Committee
O’Hara, Trigueiro, Golder Meredith Albert, Tim Shields
Enhanced Infrastructure Financing District
Public Finance Authority
Mayor Keeley, Vice Mayor Kalantari-Johnson,
Newsome. Alternate: O’Hara
Brian Borguno
Murray Street Bridge Ad-Hoc Committee Brunner, Trigueiro, Mayor Keeley Nathan Nguyen, Bonnie Lipscomb, Kevin Crossley, Rebecca Unitt, Ashley Hussey
CORE O’Hara, Trigueiro, Kalantari-Johnson Larry Imwalle External Governmental Agencies/Intergovernmental Coordinating Committees Assigned Staff Association of Monterey Bay Area
Governments (AMBAG)
Newsome, O’Hara (Alternate) Lee Butler
City Select Committee Mayor Keeley Matt Huffaker
Library Financing Authority Brunner, O’Hara (alternate) Matt Huffaker Santa Cruz County Housing for Health
Partnership (H4HP) Policy Board
Kalantari-Johnson, O’Hara Larry Imwalle
Monterey Bay Air Resources District (City
Nominee)
O’Hara nominated. County Select Committee
did not appoint.

Tiffany Wise-West
Central Coast Community Energy Policy
Board
Central Coast Community Energy
Operations Board
Mayor Keeley, Golder (Alternate)
Matt Huffaker, Tiffany Wise-West (alternate)
Matt Huffaker
Santa Cruz County Integrated Waste
Management Local Task Force
Newsome, Golder (Alternate) Bob Nelson, Leslie O’Malley (staff alternate) Santa Cruz Metropolitan Transit District
Board (METRO)
Kalantari-Johnson, Newsome Claire Gallogly
Santa Cruz County Regional Transportation
Commission (RTC)
Mayor Keeley, Newsome (Alternate) Nathan Nguyen , Claire Gallogly (alternate)

12.4 External Governmental Agencies/ Intergovernmental Coordinating Committees (cont) Assigned Staff Santa Cruz Mid-County Groundwater
Agency
O’Hara, Former Water Commissioner David
Baskin, Water Commissioner Doug Engfer
(alternate)
Heidi Luckenbach
Santa Margarita Groundwater Agency Water Commissioner Doug Engfer, O’Hara (alternate)
Heidi Luckenbach
Local Agency Formation Commission
(LAFCO) (alternate until May 2027)
Mayor Keeley Matt Huffaker
Joint Powers Authorities/City Groups Staff Appointments Agency Contact Information Santa Cruz County Animal Services
Authority
Michelle Templeton, TBD Santa Cruz County Animal Services Authority 2200 7th Avenue
Santa Cruz, CA 95062
https://www.scanimalshelter.org/
Santa Cruz Public Libraries Matt Huffaker Santa Cruz Public Libraries 117 Union Street
Santa Cruz, CA 95060
https://www.santacruzpl.org/
Santa Cruz Regional 9-1-1 Matt Huffaker Santa Cruz Regional 9-1-1 495 Upper Park Rd.

Santa Cruz, CA 95065
(831) 471-1000
External Community Organizations Councilmember/Staff Agency Contact Information Area Agency on Aging (AAA) Advisory
Council
Trigueiro, O’Hara (Council alternate), Rita
Hester (citizen alternate)
Seniors Council, Clay Kempf
234 Santa Cruz Ave.

Aptos, CA 95003
Phone: (831) 688-0400
Arts Council of Santa Cruz County Brunner Jim Brown, Executive Director 1070 River Street
Santa Cruz, CA 95060
[email protected]
831-475-9600 X 25
Climate Action Task Force Mayor Keeley Tiffany Wise-West [email protected]
Community Action Board (CAB) Newsome, Eve Bertram, UCSC Professor (alternate)
Community Action Board of Santa Cruz
County, Inc.
406 Main St. STE 207
Watsonville, CA 95076
831-763-2147
Cowell Working Group Golder, Tony Elliot (staff) CWG Facilitated by Save the Waves Downtown Management Corporation Kalantari-Johnson, Newsome, Bonnie Lipscomb (staff)
Downtown Management Corporation
[email protected]
337 Locust Street,
Santa Cruz, CA 95060
Santa Cruz County Youth Action Network Trigueiro [email protected] United Way of Santa Cruz County
4450 Capitola Rd, Ste 106
Capitola, CA 95010
Santa Cruz Community Farmers’ Market Kalantari-Johnson, Trigueiro (Alternate) Bonnie Lipscomb (staff)
Nesh Dillon Executive Director SCCFM
P.O. Box 8189
Santa Cruz, CA 95061
Thrive by 5 Advisory Committee Trigueiro David Brody [email protected] Executive Director, First 5 Santa Cruz County
4450 Capitola Road, Suite 106, Capitola, CA
95010
Visit Santa Cruz County Trigueiro, Brunner, Bonnie Lipscomb (staff) Visit Santa Cruz County 303 Water Street, Suite 100
Santa Cruz, CA 95060
800-833-3494 or 831-425-1234

12.5 City Council

AGENDA REPORT
DATE: 12/22/2025
AGENDA OF: 01/13/2026
DEPARTMENT: City Manager/City Council
SUBJECT: Adoption of Policy Framework for the Sugar-Sweetened Beverage Tax Oversight Committee (SSBTOC) (CM/CN)
LOCATION: Citywide
RECOMMENDATION: Motion to adopt a policy framework, as described in this agenda report, establishing the Sugar-Sweetened Beverage Tax Oversight Committee (SSBTOC), consistent with Santa Cruz Municipal Code § 3.38.015, to ensure community oversight, transparency, and equitable allocation of revenues generated by the Sugar-Sweetened Beverage (SSB) Tax.

BACKGROUND: In November 2024, Santa Cruz voters approved a local tax on sugarsweetened beverages (SSB) to promote community health, reduce consumption of sugary drinks, and address inequities related to diet-related diseases. The voter-approved ordinance directed the creation of a community oversight body to ensure transparency, accountability, and equitable use of SSB tax revenues.

Per Santa Cruz Municipal Code § 3.38.015, the Sugar-Sweetened Beverage Tax Oversight Committee (SSBTOC) will review expenditures, assess impact, and recommend funding priorities consistent with the ordinance’s intent to benefit the residents of the City of Santa Cruz.

The SSBTOC will advise the City Council on effectiveness of the tax including strategies to improve health outcomes and expand access to healthy environment and wellness initiatives, and reduce SSB consumption, especially for children, low-income families, and communities disproportionately affected by sugary drink consumption.

DISCUSSION: The SSBTOC will function as an advisory body to the City Council, charged with:

1. Providing recommendations to the City Council on the use of the funds and

2. Overseeing and monitoring use and implementation of the funds including via an annual public report
The SSBTOC will consist of seven members: one Parks and Recreation Commissioner appointed by the Parks and Recreation Commission; one member of the City Council appointed directly by the City Council; and five members recommended by the City Manager’s Office and ratified by City Council. City staff will provide administrative support.

13.1 The sponsoring Councilmembers recommend that the City Council adopt the following framework for the SSBTOC:

1. New and Expanded Programs and Services: The SSBTOC should recommend prioritization of new and expanded City and community services and health and wellness programs, which can be provided by City and outside community-based organizations.

These recommendations will be made prior to the City’s next fiscal year budget review process. The SSBTOC will review and advise on all proposed allocations and reallocations of the Tax including any changes to departmental appropriations supported by the Tax. The SSBTOC should limit recommendations that would utilize the revenues to fund existing General Fund programs.

2. Diverse Membership: SSBTOC members should represent diverse sectors, including healthcare, dental, and/or wellness professional(s); representative(s) from the education industry; and representative(s) from youth organization(s).

3. Regular Meetings: The SSBTOC should meet regularly (at least four times per year) and submit an annual report to the City Council. Meetings will be open to the public and noticed in advance.

4. Reporting and Evaluation: The SSBTOC will annually assess and report on the alignment between Sweetened Beverage Tax fund allocations and the intent of the ordinance, including identifying trends, risks, and opportunities to strengthen the strategic use of tax revenues. The annual report will include program-level expenditure details and clearly demonstrate how each funded activity advances the ordinance’s purpose. The report will be based on SSBTOC review and recommendations and will be prepared and submitted by the SSBTOC with the support of City staff. This annual report will highlight progress on the implementation and outcomes of services funded by the SSB Tax and will be publicly provided prior to the following year’s fiscal year budget reviews.

5. HiAP as Core Values: The SSBTOC’s recommendations will integrate the three pillars of Health in All Policies:
a) Health: Prioritize reducing health disparities caused by diet-related disease and inequitable access to nutrition and wellness.
b) Equity: Apply an equity lens to all decisions, ensuring that communities of color, immigrants, and low-income residents are centered in funding and program design. c) Sustainability: Promote environmental health by reducing the consumption of single use containers —which contribute significantly to watershed and ocean pollution— and by investing in initiatives that support long-term environmental health.

6. Community Voice: The SSBTOC should elevate the lived experience and leadership of those most affected by sugary drink marketing and health inequities.

7. Transparency and Accountability: The SSBTOC should maintain open communication with the public and provide annual public reports to the City Council on recommended expenditures and outcomes.

8. Trust and Collaboration: The SSBTOC should foster partnership among City staff, community organizations, and residents to strengthen collective impact.

9. Community Driven: The SSBTOC should recommend funding for programs and services designed or implemented in partnership with or by organizations with authentic relationships in impacted communities.

10. Culturally Responsive: The SSBTOC’s recommendation should support initiatives that honor linguistic, cultural, and contextual needs of the focus populations.

11. Evidence Informed: The SSBTOC’s recommendations should balance scientific evidence with community knowledge and innovation.

13.2 12. Systems Change and Direct Service: The SSBTOC should recommend investing in both immediate interventions and long-term structural solutions addressing root causes of inequity.

Lessons from Peer Cities
Peer jurisdictions such as Berkeley, San Francisco, Seattle, and Boulder have demonstrated the effectiveness of community-led oversight in ensuring SSB tax revenues achieve measurable impact. Berkeley’s expert panel has directed funds to school nutrition and community gardens; San Francisco’s committee embeds equity through grants to culturally responsive wellness programs; Seattle’s Community Advisory Board uses a values-based budgeting approach that integrates racial equity and accountability; Boulder’s transparent grantmaking prioritizes BIPOC youth health outcomes. These models inform Santa Cruz’s proposed SSBTOC structure and reinforce the importance of sustained public engagement, data-driven evaluation, and protection of restricted health funds.

Implementation
Following City Council approval of this framework, City staff will finalize the public recruitment, bring recommendations for SSBTOC members before the City Council, and the City Council will provide final committee membership approval. Once the committee is established, SSBTOC members will review and approve draft bylaws. The bylaws will outline the meeting schedule, procedures for electing chairs and officers, terms of office, and the process for developing evaluation metrics, spending recommendations, and expenditure reviews-aligned with the intent of the measure. City staff will also provide the SSBTOC with funding estimates and baselines for existing City-funded health and wellness programs to support effective oversight and alignment.

All recommendations will be presented to the City Council in an annual public report for approval. (SCMC 3.38.015.) The City Council is ultimately tasked with determining how the funds will be spent, consistent with the Municipal Code Chapter 3.38, which established “a general excise tax on the distribution of sugar-sweetened beverage products to raise funds for unrestricted general revenue purposes, including, but not limited to, promoting community health and wellness, and sustaining vital city services.” (SCMC 3.38.010.) CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: This action does not constitute a project under CEQA because it involves administrative and policy direction only and does not result in any direct or reasonably foreseeable physical change to the environment.

HEALTH IN ALL POLICIES (HiAP): The proposed SSBTOC framework advances all three pillars of the City’s Health in All Policies approach—Public Health, Equity, and Sustainability. It promotes health by targeting a major contributor to diet-related disease and expanding access to wellness programs; advances equity by centering investments in communities disproportionately impacted by sugary drink consumption and health inequities; and supports sustainability by reducing the consumption and waste associated with single-use beverage containers, thereby mitigating ocean and coastal pollution. Together, these actions strengthen community wellbeing, environmental stewardship, and intergenerational health for all Santa Cruz residents.

13.3 FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: Yes

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: The SSBTOC will review and make recommendations regarding the allocation of General Fund revenues generated by the SSB tax.

Submitted By:

Shebreh Kalantari-Johnson
Vice Mayor
Sonja Brunner
District 2 Councilmember
Gabriela Triguero
District 1 Councilmember
ATTACHMENTS:

None.

13.4 City Council

AGENDA REPORT
DATE: 12/18/2025
AGENDA OF: 01/13/2026
DEPARTMENT: City Manager
SUBJECT: FY25 Strategic Plan Annual Report (CM)
LOCATION: Citywide
RECOMMENDATION: Motion to approve the Fiscal Year (FY) 25 Strategic Plan Annual Report.

BACKGROUND: In late summer 2022, the City of Santa Cruz (City) initiated the development of its Citywide Strategic Plan (Plan), which was adopted and launched in August of 2023, covering FY24 through FY29. This Plan provides a focused roadmap for addressing community priorities and challenges. Baker Tilly was selected through a competitive process and partnered with the City to lead this effort.

The creation of the Plan involved a comprehensive and inclusive process. This included an environmental scan to analyze local trends and challenges, community engagement through surveys and workshops, and strategic discussions with the City Council and staff. The Plan was informed by over 275 community survey responses, input from departments, historical research, and City Council feedback.

The Plan outlines seven focus areas:
1) Fiscal Sustainability and Transparency
2) Strong Business Communities and a Vibrant Downtown
3) Housing
4) Homelessness Response
5) Public Safety and Community Well-Being
6) Natural and Built Infrastructure
7) Thriving Organization
These priorities reflect the City’s ongoing efforts to ensure a healthy and vibrant future for the community.

Since its adoption, significant progress has been made in implementing the Plan. In the first year, a Strategic Plan Subcommittee was established to oversee this implementation and ensure alignment among the various departments. The subcommittee facilitated workshops with City

14.1 departments to identify projects, goals, and performance metrics that are directly linked to the Plan’s focus areas.

As a result of these efforts, staff have developed a citywide process to identify priority projects and initiatives for tracking progress and ensuring accountability year-over-year. The projects and initiatives highlighted in the Strategic Plan Annual Report include infrastructure investments, housing initiatives, improvements in public safety, and enhancements in economic vitality and overall operations. This collaborative process has strengthened alignment between departmental activities and the City’s strategic vision, ensuring the effective, targeted use of resources and efforts.

DISCUSSION: City staff have continued to advance initiatives launched since the adoption of the Plan, some of which have been completed, and others that are complex, multi-year efforts.

TheFY25 Strategic Plan Annual Report provides the City Council and the community with progress updates on priority initiatives, highlights milestones and key accomplishments, and provides a look ahead at initiatives the community can anticipate in the year to come.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: The proposed action is not a “project” under CEQA because approval of the FY25 Strategic Plan Annual Report does not have the potential to cause a physical change in the environment either directly or indirectly, because it is an update on implementation of the Strategic Plan, some components of which may require separate CEQA review.

HEALTH IN ALL POLICIES (HiAP): The Strategic Plan aligns directly with the City’s Health in All Policies (HiAP) framework by incorporating equity, public health, and sustainability into its focus areas and implementation strategies. HiAP principles are embedded into decision-making so that the City works towards a just and equitable community where all residents can thrive. The identified projects outlined in the FY25 Strategic Plan Annual Report align with the three pillars (equity, public health, and sustainability) and include equitable access and affordable housing, economic opportunities and fiscal sustainability, infrastructure investments, homelessness response, and accessible green spaces.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: No

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: There is no direct fiscal impact. However, the cost associated with implementation of the programs and projects outlined in the Strategic Plan are, and will continue to be, incorporated into the City’s annual and long-term budget priorities.

Prepared By:

Emeline Nguyen
Principal Management
Analyst
Submitted By:

Michelle Templeton
Assistant City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. STRATEGIC PLAN ANNUAL REPORT FY2025.PDF

14.2 Strategic Plan
Annual Report
Fiscal Year 2025

14.3 3 MESSAGE FROM THE CITY MANAGER
4 SANTA CRUZ CITY COUNCIL
5 WHAT THE COMMUNITY THINKS OF SANTA CRUZ
6 FOCUS AREA #1: FISCAL SUSTAINABILITY & TRANSPARENCY
9 FOCUS AREA #2: STRONG BUSINESS COMMUNITIES & A VIBRANT DOWNTOWN 13 FOCUS AREA #3: HOUSING
16 FOCUS AREA #4: HOMELESSNESS RESPONSE
18 FOCUS AREA #5: PUBLIC SAFETY & COMMUNITY WELL-BEING
22 FOCUS AREA #6: NATURAL & BUILT INFRASTRUCTURE
25 FOCUS AREA #7: THRIVING ORGANIZATION
28 APPENDIX A: STRATEGIC GOALS & FOCUS AREAS

TABLE OF CONTENTS

TRIPLE CROWN FROM THE GOVERNMENT FINANCE OFFICERS ASSOCIATION (GFOA) In Process

NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION (NOAA)
Fisheries award for outstanding partnership in anadromous salmonid conservation efforts

AMERICAN PLANNING ASSOCIATION (APA) OF NORTHERN CA AWARD OF EXCELLENCE Resilience and Sustainability award – 50-year Community Vision for West Cliff

AWARD RECOGNITIONS

14.4 In 2024/25, teams across every department worked to improve how we serve our community. We advanced key projects that expand housing, strengthen homelessness response, activate our downtown, expand recreation and wellness initiatives, and support deeper community engagement.

This year also brought major infrastructure investments from reliable water and wastewater systems, to protecting our coastline and natural resources, and transportation and public safety improvements.

Several multi-year projects reached key milestones, new programs and organizational improvements were launched to transform how we do business and serve the community, and foundational planning laid the groundwork to support the next phase of investments in FY 26 and beyond.

These accomplishments reflect our team’s continued work to bring the City Council’s strategic vision to life and demonstrate the strength of the partnerships we’ve built with residents, businesses, and community organizations.

Through the holistic lens of equity, public health, and sustainability, we remain focused on ensuring that progress benefits everyone who calls Santa Cruz home. Together, we’re shaping a city that honors the fabric of what makes Santa Cruz special while meeting the changing needs of our community.

Matt Huffaker, City Manager
This year, the City made meaningful progress in translating our Strategic Plan vision into action. The Strategic Plan Annual Report for Fiscal Year 2025 (FY25) outlines how we’ve advanced the City Council adopted FY24–FY29 Strategic Plan across seven focus areas, and provides an update on major projects, service improvements, capital investments, and a sneak peek at initiatives to come.

MESSAGE FROM THE CITY MANAGER

14.5 SANTA CRUZ CITY COUNCIL
Mayor
Fred Keeley
Councilmember
Gabriela Triguero
District 1
Councilmember
Sonja Brunner
District 2
Vice Mayor
Shebreh KalantariJohnson
District 3
Councilmember
Scott Newsome
District 4
Councilmember
Susie O’Hara
District 5
Councilmember
Renee Golder
District 6

14.6 WHAT THE COMMUNITY THINKS OF SANTA CRUZ
ACCORDING TO THE 2024 NATIONAL COMMUNITY SURVEY
73%
RATED SANTA CRUZ AS AN “EXCELLENT”
OR “GOOD” PLACE TO LIVE
89%

WOULD RECOMMEND SANTA

CRUZ TO SOMEONE WHO ASKED
80%

RATED DOWTOWN AREA VIBRANCY
AS “EXCELLENT OR GOOD”
91%

RATED QUALITY OF NATURAL
ENVIRONMENT AS “EXCELLENT”
OR “GOOD”
92%

RATED CLEANLINESS OF SANTA
CRUZ’S NATURAL SPACES AS
“EXCELLENT OR GOOD”
85%

RATED PARKS AND RECREATION

OPPORTUNITIES AS
“EXCELLENT” OR “GOOD”

14.7 Improved City Cost Recovery
Updated a variety of fees, such as permits, business licenses, and other transactions and services, to more accurately reflect the resources required to serve the community. One example is the citywide 3% credit card service fee being rolled out to all online tax and parking payments to recoup credit card transaction costs previously absorbed by the City, saving over $1M annually.

FOCUS AREA 1 | FISCAL SUSTAINABILITY & TRANSPARENCY
FOCUS AREA 1 | PROGRESS & ACCOMPLISHMENTS
Advanced Water Infrastructure While Maintaining Affordability To minimize how much water rates rise, the City funded
capital improvements through grants and low-interest loans:

Executed a $32.2 million low-interest loan, for the Newell Creek Pipeline Project.

Received over $600,000 in grant reimbursements for
ongoing water supply projects.

Passed New Wastewater 5-Year Rates
The City passed a wastewater rate adjustment to fund the replacement of aging infrastructure, such as the Wastewater Treatment Facility Electrical System ($90M), the Headworks Project ($20M), and to offset rising operational costs. The new rates ensure responsible fiscal management by maintaining adequate reserves for operations, debt service, and emergencies.

Ensure the City is on a strong financial trajectory, through planful investments and revenue development.

Rolled Out an Online, Interactive Budget Tool to the Public The City provided an interactive platform for the community and staff to explore the budget, increasing transparency and understanding of citywide revenues and expenditures.

Maintaining Public Safety in a Growing Community
The City completed a Public Safety Impact Fee (PSIF) Nexus Study to accurately reflect the impact of new development on public safety services. This ensures that new development contributes to the infrastructure needed to sustain reliable emergency response and protect the communitys safety.

14.8 FOCUS AREA 1 | SPOTLIGHT
FOCUS AREA 1 | FY26 SNEAK PEEK
Launched New Utility Customer Assistance Program (UCAP) In 2025 the City launched the first monthly bill credit program providing assistance to qualifying low-income
single-family household water customers. The City will
explore expanding this program to multi-family residential customers 2026.

Sugar-Sweetened Beverage Tax (SSBT)
Santa Cruz joins four California cities—Berkeley, Oakland, San Francisco, and Albany in implementing SSBT. The tax, approved by City voters in 2024, took effect on May 1, 2025 taxing distributors two cents ($0.02) per fluid ounce. In the first two months, the tax brought in approximately $400,000 in General Fund revenue, currently being set aside to fund efforts that support community health and wellness.

Measure Q Funding Implementation
Beginning in FY26, Measure Q funding, approved by voters in November 2024, will be implemented through a per-capita allocation that will support wildfire prevention, habitat restoration, forestry, watershed protection, and resource management across City open space.

14.9 Description FY25
Friends of Parks and Recreation (FOPAR) Scholarships Up 62% First FOPAR Community Fundraiser – Live at the Lane Raised $20,000 Clam Chowder Cookoff in Partnership with Santa Cruz Beach Boardwalk
New Record Raised $142,000
New UCAP Water Enrollees 259
Additional Grant Funding from Downtown Library Project for City Infrastructure Improvements and Metro Buses Downtown $11M Amount Invested in Water System Capital Improvements $27.4M Grants Supporting Water Investments $600K
FOCUS AREA 1 | BY THE NUMBERS

14.10 FOCUS AREA 2 | STRONG BUSINESS COMMUNITIES & A VIBRANT

DOWNTOWN
FOCUS AREA 2 | PROGRESS & ACCOMPLISHMENTS
Cultivate a thriving downtown and local businesses citywide to support economic health and vitality.

Downtown Play & Paseos Project
Construction planning is underway for the Downtown Play and Paseos Project. With interactive play features, upgraded lighting, pet-friendly amenities, wayfinding, and redesigned service lanes, the project will create a safer, more engaging downtown, revitalizing the Downtown core and strengthening the local community and economy. Grant funded work is anticipated for Winter FY27.

Expanding Downtown (DT) Pops! Program
Since launching, DT Pops! has supported 10 businesses, including the recent activation of three new locations that have been vacant for up to seven years.

Santa Cruz Gear Exchange began a six-month pop-up lease in October 2025 at 1306 Pacific Ave.

Collective Santa Cruz will produce three two-day holiday-themed events in November, December, and February, in the former Logos building.

Santa Cruz Mountain Makers Market and First Friday Santa Cruz were selected to produce a November - December holiday makers market and a First Friday event series and partnership with the Ripple Effect Arts Festival from January through April in the former Palace Arts space.

Enhanced Infrastructure Financing District (EIFD)
The City completed an analysis of potential financial options and is now working to establish an EIFD, capturing property tax revenue growth that will aid in financing important infrastructure projects and incentivize investments in the City and Downtown Plan Expansion area.

Ocean Street Beautification
The community selected artists for the public art elements of the Ocean Street Beautification project. This effort will revitalize the City’s main entry corridor with new public art, welcome signage, and sustainable landscaping. Serving over 45,000 daily commuters, this will create an inviting first impression while supporting Ocean Street businesses. Completion is targeted for Summer of 2026. Downtown Design Standards & Improvements The City completed the Downtown Design Standards and
Improvements project supporting the overall vibrancy of Santa Cruz’s downtown through new park benches, wayfinding
signage, newly painted light posts and business kiosks, new plantings, and a well-maintained tree canopy.

14.11 FOCUS AREA 2 | SPOTLIGHT
FOCUS AREA 2 | FY26 SNEAK PEEK
Relocation and Expansion of Farmers Market
The City partnered with the Farmers’ Market in FY25 to
successfully relocate to the City lot next to the Library and onto portions of Church and Cedar Streets. Multiple
departments worked to ensure a smooth transition from an off-street market to the expanded on- and off-street
operation. The new location has exceeded expectations, and the City and Farmers’ Market board are planning future
expansion once the Library moves to its new downtown site.

Seabright & Harbor Business Support
In FY26, the City will continue to support Seabright and Harbor businesses during the Murray Street Bridge Seismic Retrofit project through radio and news advertising, social media, business outreach, event sponsorships, a Construction Impact Mitigation Loan program, and a potential grant program.

A marketing professional will assist alongside City staff in providing ongoing business support and construction updates.

Strengthening Infrastructure on the Iconic Wharf
The Wharf Resilience Project, primarily funded through an $8.6M California Coastal Conservancy grant, will strengthen key areas of the Wharf, advancing the Wharf Master Plan, including design of new boat landings, the East Promenade, and relocated entrance gates with updated signage.

Planning is underway with improvements expected to begin in Fall of 2026. Additionally, the City conducted extensive public outreach for design alternatives supporting the Wharf Resilience Project and interim repairs to the end of the Wharf damaged in the 2024/25 storm events.

Streamlining Approvals for Commercial Tenant Improvements A new tenant improvement program will provide a one-stop, same-day plan review process that involves all key development review departments, including Planning, Building, Fire, Public Works, Water, and Green Building. This coordinated approach aims to streamline the approval of tenant improvements, reduce delays, and offer unified feedback, for an enhanced customer experience.

14.12 FOCUS AREA 2 | FY26 SNEAK PEEK: NEW BUSINESS INVESTMENTS IN

DOWNTOWN
Anthropologie is coming to Downtown!
Downtown Santa Cruz welcomes a new retail
anchor to the corner of Pacific Avenue and
Soquel Avenue - taking over the historic Bank
of Italy building, most recently home to New
Leaf Market. Estimated to open in Winter 2026.

Insomnia Cookies, at 1010 Pacific Avenue, is the
newest addition to the late-night excitement,
offering a variety of fresh desserts for both
pick-up and delivery until 1 AM on weeknights
and 3 AM on weekends.

Ashby Confections will bring highly prized
artisan. chocolates to Downtown at 1207 Pacific
Avenue, the former Joe’s Pizza and Subs
location.

The Alley Oop! A new cocktail bar and
speakeasy-style lounge, coming into the former
Poet & Patriot bar at 320 Cedar Street, which
will be an exciting addition to enhance the
downtown nightlife.

Switch Bakery, known for its artisan gluten-free
baked. goods at the Santa Cruz Farmers’
Market, is expanding its offerings and opening a
brick-and mortar location at 1016 Cedar St. in
Fall 2025.

14.13 Description FY25
Number of Businesses Contacted for Assistance 447
Number of Businesses Receiving Assistance to Start or Grow 240 Public Art Projects Completed 5
Number of New Businesses That Were Added to the City 146 (14% Increase) EV Charging Stations/Ports 17
Downtown Pops! Program Businesses Supported Since
Inception 10
Valuation of Building Permit Activity and New Construction $94,436,979 (FY24) FOCUS AREA 2 | BY THE NUMBERS

14.14 Completed The Downtown Expansion Plan
Following over four years of work, the City certified the Environmental Impact Report and approved the Downtown Plan Expansion specific plan and area plan updates, with final approval from the Coastal Commission in August of 2025. This effort will bring critically needed housing to our community, and the first formal development application in the area has been submitted.

Construction Underway on Pacific Station North
With completion anticipated for Fall of 2026, Pacific Station North will create 128 affordable housing units, a new transit center with expanded service, commercial retail, public safety improvements, and a new Maple Alley Paseo providing bike and pedestrian connections to the San Lorenzo Riverwalk Trail.

St. George Settlement Agreement – Preservation of Affordability The City Council and staff successfully negotiated a settlement agreement with the owners of the St. George Apartments located on Pacific Avenue in Downtown Santa Cruz to help preserve the affordability of 53 affordable housing units whose affordability restrictions had expired.

Regional Housing Needs Assessment (RHNA) Progress
Calendar year 2024 was the first year of the City’s 6th Cycle Housing Element reporting, including progress towards meeting RHNA targets. While the City’s RHNA targets increased by five times compared to the 5th Cycle, it was on track to meet its RHNA goals for very low and low-income categories, which are the hardest to meet, based on achieving its prorated share in the first year of the cycle. The City is doing its part to meet its goals for preserving affordability for the community.

FOCUS AREA 3 | HOUSING
100 Laurel (Anton Pacific) 428 Front Street (RiverRow) 530 Front Street FOCUS AREA 3 | PROGRESS & ACCOMPLISHMENTS
Create and preserve housing for all with a focus on affordable and workforce housing.

14.15 FOCUS AREA 3 | SPOTLIGHT
Downtown Library Affordable Housing Project Groundbreaking 2025 The Downtown Library and Affordable Housing Project has begun the first of two construction phases, with completion estimated for the end of 2027. This project will create 124 affordable housing units along with a modern library, childcare facility, 200+ bicycle parking spaces, 240 parking spaces of which 25 will be level 2 EV charging.

FOCUS AREA 3 | FY26 SNEAK PEEK
River Street Affordable Housing
The 136 River Street project, formerly Outdoor World, will deliver 50 affordable apartments for households earning 60% of Area Median Income (AMI) and below. Supported by an $1.8M grant match from the State’s Local Housing Trust Fund, this 100% affordable development will expand access to housing near downtown. Construction is slated to begin in early 2026, with completion expected in 2028.

Housing Element Workplan Implementation
The Housing Element has over 120 required objectives that aim to increase housing production, promote affordable housing, protect tenants, and affirmatively further fair housing, among other goals. Some of the notable objectives coming in FY26 include allowing additional units in singlefamily areas and updating and streamlining the affordable housing ordinance.

14.16 Description Calendar Year 2024
Prorated Progress Towards RHNA Targets in Every Income
Level
603
Number of Affordable Housing Units that Began Construction 480 Number of ADUs that Began Construction 106
Affordable Housing, Local, State & Federal Monitoring 1,900+ Units 130 Center Street Center Street, 524, 532, 538 - Center/Cedar Project, Calvary Church
119 Coral Street
120 Permanent Supportive Housing Units
126 Eucalyptus Avenue
76 Unit Senior Housing Facility
FOCUS AREA 3 | BY THE NUMBERS

14.17 Encampment Resolution Fund (ERF) Grant – Funding & Workplan The City received a $4.03M Encampment Resolution Fund Grant in FY25 to support the resolution of encampment challenges in the Harvey West Neighborhood.

Santa Cruz Inn Permanent Shelter Program
The City granted $3.89M in ERF funding to Housing Matters to acquire the Santa Cruz Inn. This funding, along with County Measure K and Housing Matters' private capital, will create 20 interim housing units with City assistance.

Reduction in Homelessness Over Time
The City’s Homelessness Response Strategic Plan aims to reduce homelessness, and despite an uptick in the latest Point-in-Time count, homelessness in the City has decreased by 40% over the past three years (from 1,439 to 862).

Extreme/Severe Weather Shelter
Over the past two years, Santa Cruz has partnered with the County and the City of Watsonville to expand temporary shelters for severe weather. These shelters activate during extreme cold or flood risk. In FY25, more than 300 individuals accessed shelter across 18 activation nights.

FOCUS AREA 4 | HOMELESSNESS RESPONSE
FOCUS AREA 4 | PROGRESS & ACCOMPLISHMENTS
Working with the County and community partners, move toward positive outcomes in homelessness response, safety and health, balancing the interests of persons who are unhoused and housed, and the business community.

Extreme Weather Shelter RV Safe Parking 1220 River Street Photos from Partner People First of Santa Cruz County Page 16

14.18 FOCUS AREA 4 | SPOTLIGHT
Shelter & Safe-Parking Programs
The City supports 180 shelter and safe-sleeping spaces. In FY25, these programs served 357 people, including 78 who moved into stable housing. Management of the City Overlook Shelter transitioned to People First of Santa Cruz County, whose integrated case management and healthcare
approach strengthens long-term housing stability.

FOCUS AREA 4 | FY26 SNEAK PEEK
Support for Maintaining Day Services
The City, County, and community partners are working to identify new providers, locations, and funding to keep essential Day Services available, as the closure of Housing Matters’ planned dropin services in March 2026 will create a critical gap for the unhoused community.

Expand Homelessness Response Outreach Team (HRT)
The City is exploring expanding the HRT next year, increasing capacity to cover more areas citywide and better meet the growing needs of the community.

Addressing Substance Use in Our Community
The City received a $30M Behavioral Health Continuum Infrastructure Project (BHCIP) Grant from the State Department of Health Care Services to construct a 50-bed adult residential substance abuse treatment center at the City-owned property at 125 Coral St., which will be the future Coral Street Navigation Center.

Supporting City Shelter & Safe Sleeping Programs
The City received a $2M grant from the State Department of Housing and Community Development that was used to provide operational support for the City sponsored shelter and safe-sleeping programs serving 135 participants at the Santa Cruz Armory facility.

FOCUS AREA 4 | BY THE NUMBERS
Description FY25
Number of People Served in City-Sponsored Shelter, Safe Sleeping, & Safe Parking Programs 357
Number of People Served that Exit into More Stable Housing 78 Number of People Experiencing Homelessness from Point-inTime Count 862

14.19 Type 6 Wildland Fire Engine
A new Type 6 Wildland Fire Engine was added to the fleet, increasing the City’s ability to respond to local wildland fire threats while also supporting major incidents across California through the statewide Master Mutual Aid system.

Expanding Marine Safety
Two additional full-time Marine Safety Officers were added to the City’s Marine Safety Division, enhancing the City’s ability to protect residents and visitors along our coastline year-round.

Street Sweeping Pilot Program
The Street Sweeping Pilot Program improves environmental protection and stormwater compliance by reducing contaminants in local waterways. This program includes a new parking enforcement and towing initiative in high-impact areas, which allows for complete curbside cleaning. This effort helps meet the State Water Board's permit requirements and promotes cleaner streets and storm drains.

FOCUS AREA 5 | PUBLIC SAFETY & COMMUNITY WELL-BEING
FOCUS AREA 5 | PROGRESS & ACCOMPLISHMENTS
Provide public safety services that support well-being and healthy communities.

Police Staffing Study
The study will analyze staffing models and explore innovative approaches to responding to service calls and improving retention.

Expansion of Community & Recreation Programming
In FY25, the City expanded its Parks and Recreation community programming to support HiAP, the Master Plan on Aging, and the Children and Youth Bill of Rights. New offerings, including free lunchtime yoga and Pilates classes, as well as events like Retro Rainbow and Pride Prom, have increased access for diverse groups.

Technology-Driven Policing
Technology-driven policing tools were introduced to improve response, accountability, and investigative efficiency. New automated license plate readers, upgraded body-worn and in-car cameras, tasers, and unmanned aircraft systems support faster data-driven decisions and safer, more efficient operations.

14.20 FOCUS AREA 5 | SPOTLIGHT
Protecting UCSC through Fire Services
A one-year extension of the Fire Service and Firehouse
Lease Agreement between the City and UCSC was approved
to allow the results of the Community Risk Assessment and Standards of Cover and Deployment Analysis to be
incorporated into the next agreement. The renewed
partnership supports cost recovery, generates revenue, and further strengthens the City’s collaboration with UCSC.

Additionally, a countywide youth initiative, Project ASCEND (Achieving Success through Community, Education, and Nurturing Development), launched in 2025, offers alternatives to traditional juvenile justice for youth ages 12-17 facing nonviolent misdemeanor charges. Through restorative justice, counseling, and community service, the program helps participants address underlying issues and build positive life skills. Focused on prevention and rehabilitation, the project aims to reduce juvenile recidivism, strengthen families, and improve community safety.

Youth-Centered Grants & Programs
Two youth-focused public safety grants are being renewed to support citywide education and prevention.

The Office of Traffic Safety Grant funds bike and
pedestrian safety programs with Ecology Action.

The California Department of Justice Tobacco Grant
supports enforcement and retailer education to prevent
illegal tobacco sales to minors.

14.21 Implement Fire Department Drone Program
The Fire Department will launch a drone program to enhance emergency response and training and support search and rescue, wildfire monitoring, and event safety operations.

Fire Explorer Program
A new Fire Explorer Program will offer local youth hands-on exposure to fire and emergency medical services through structured training, mentorship, and community engagement, creating pathways into public safety careers – particularly for students from underserved communities.

City Wildfire Resiliency Plan (CWRP)
A CWRP will identify and prioritize critical infrastructure, improve forest health, and strengthen protection for neighborhoods in Wildland Urban Interface (WUI) areas. The Wildfire Ad-Hoc Committee will bring a communications strategy to Council in FY26 to support community wildfire preparedness.

Emotional Support K-9 Program
This program will introduce specially trained dogs to support officers and civilian staff coping with stress or trauma, comfort victims, and participate in outreach and public safety education events.

Spanish & English-Speaking Citizen Academy
In FY26, a Spanish and English Citizen Academy will be offered to strengthen relationships between law enforcement and residents by removing barriers to engagement. Each eight-week program will provide a firsthand look at police operations, community policing, and public safety practices.

FOCUS AREA 5 | FY26 SNEAK PEEK

14.22 Description FY25
FD Calls for Service 9,500
Lifeguard Contacts with the Public 232,400
CruzAware Registrations 3,870
Average Response Time to City Emergency Calls 6:11
PD Calls for Service 63,725
Number of Citations 4,181
Number of Arrests 2,934
Number of Participants in City Programs & Classes 115,552 Number of Residents within a 10-Minute Walk of a Park 96% FOCUS AREA 5 | BY THE NUMBERS

14.23 Parks and Recreation Park & Facility Planning and Modernization Key projects include redesigns of San Lorenzo Park and Harvey West Park, restoration of Jessie Street Marsh, safety upgrades to the Civic Auditorium, and improvements to DeLaveaga Golf Course. Notably, Cowell Beach became Santa Cruz County's first ADA-accessible beach, with Mobi-Mats and ramps for
wheelchairs and strollers.

Coastal Rail Trail Segments 8 and 9
The Rail Trail Segments 8 and 9 Project will create a 2.2-mile, 10 to 120-foot-wide multi-use path from the Wharf Roundabout to 17th Avenue. This off-road facility will provide a low-stress route for cyclists and pedestrians, connecting nearby residents to key commercial and recreational areas.

Water Supply Augmentation Implementation Plan (WSAIP)
The WSAIP is a roadmap for the City's long-term water supply goals, targeting an additional 500M gallons per year by 2027 and closing the supply gap by 2032. Key projects include ASR upgrades at Beltz Well 12, the Concrete Tanks Replacement Project at Graham Hill Water Treatment Plant, and the Regional Drought Resiliency Project Intertie 1 with Scotts Valley Water District.

FOCUS AREA 6 | NATURAL & BUILT INFRASTRUCTURE
Murray Street Bridge Seismic Retrofit & Barrier Rail Project The City began construction on the Murray Street Bridge Improvement Project to improve safety, and accessibility along one of Santa Cruz’s key coastal corridors. Upgrades will include new support piles for seismic resilience, wider bike lanes, a broader pedestrian sidewalk to improve comfort and mobility and constructing a larger County sewer main to support long-term infrastructure reliability.

FOCUS AREA 6 | PROGRESS & ACCOMPLISHMENTS
Invest in sustainable, climate-adapted infrastructure and community assets in both the natural and built environment.

Local Hazard Mitigation and Climate Adaptation Plan
In 2025, FEMA and the City Council approved Santa Cruz’s 2025-2030 Local Hazard Mitigation and Climate Adaptation Plan, the first combined plan of its kind in the nation, outlining 27 projects to address natural and climate-related hazards over the next five years. It strengthens the City's resilience to disasters and unlocks eligibility for federal hazard mitigation funding.

14.24 FOCUS AREA 6 | SPOTLIGHT
Urban Forest & Biodiversity Enhancements
Reinforcing Santa Cruz’s standing as a “Tree City USA,” the City expanded citywide tree planting and vegetation management with 75 new trees planted and tree canopies pruned for safety and health. Restoration work continued in Moore Creek Preserve and Pogonip Open Space, supported by $150,000 in donor funding, while over 1,000 Santa Cruz tar plants were planted at Arana Gulch in partnership with UCSC.

FOCUS AREA 6 | FY26 SNEAK PEEK
5-Year Roadmap for West Cliff
Adopted in Spring 2025 in response to 2023 and 2024
storm events, the West Cliff 5-Year Roadmap transforms the community’s long-term 50-Year Vision into actionable steps for improving resilience and coastal adaptation along one of Santa Cruz’s most iconic coastlines. Developed with
extensive public engagement and guidance from the West
Cliff Implementation Committee, the Roadmap identifies five priority projects for the next five years: Revetment Repair, Lighthouse Field Roadway Relocation, Coastal Change
Monitoring, Infrastructure Financing Feasibility, and a Corridor-wide Mater Signage Plan.

Building Resilient Coast Santa Cruz 2.0
Nature-Based Solutions & Sand Management Study - Coastal Conservancy funded study on sustainable shoreline protection.

NOAA-Funded Coastal Restoration Designs - for Main Beach, Jessie Street Marsh, and the San Lorenzo Park Riverlands, developed with tribal and community partners.

Three Shoreline Adaptation Blueprints - West Cliff, Main/Cowell, and East Cliff/Seabright will outline 20-year strategies, meet regulations, and guide the Local Coastal Program.

California Coastal Accelerator Participation - Santa Cruz is one of five cities selected statewide, strengthening local leadership in coastal adaptation and innovative infrastructure financing.

Implementing the Climate Action Plan 2030 Work Plan
Staff are developing the 2026-2029 Climate Action Plan
2023 Work Plan, which incorporates community feedback,
particularly from Spanish-speaking residents, and will be presented to the City Council for adoption in January 2026.

These updated plans will provide strategic direction to advance sustainability, climate resilience, and equity across all City operations.

14.25 Bethany Curve Culvert Bridge Mosaics
Community members are coming together to design and create mosaic murals on the new Bethany Curve Culvert Bridge, transforming vital infrastructure into a shared work of art. Residents participate directly in the artist selection, design, and fabrication process – building civic pride and ownership in a lasting public asset. Beyond beautification, integrating art into infrastructure also helps reduce graffiti and fosters a stronger sense of community identity.

Description FY25
Number of Work Orders Received & Completed in CRSP 500
Tons of Debris Removed from the Roadway 410
Water System CIP Projects Completed Since 2018 22
Amount Invested in Water System Capital Improvements $27.4M Advancing a Unified Water Reliability Strategy
Three interconnected initiatives will continue advancing Santa Cruz’s long-term water reliability and environmental stewardship goals.

The Anadromous Salmonid Habitat Conservation Plan will improve San Vicente Creek habitat.

Modification to City surface water rights to be incorporated into Water Department operations.

Design for Aquifer Storage and Recovery (ASR) at Beltz Wells 8 and 9, groundwater modeling to confirm water quality and available supply through ASR, recycled water, and regional transfers.

FOCUS AREA 6 | FY26 SNEAK PEEK
FOCUS AREA 6 | BY THE NUMBERS
Harvey West Pool Open to the Public
Harvey West Pool reopened to the public in Fall 2025 after a long period of closure. In FY26, the facility will expand program offerings to include lap and recreational
swimming, classes, and rentals.

Investing in Community Space & Accessibility
Several long-awaited parks and recreation improvements are slated for completion in FY26, including the Grant Street Park playground renovation, the City’s first dedicated
pickleball courts in collaboration with UCSC at the Westside Research Park, major NOAA-funded projects at San Lorenzo Park Riverlands and Jessie Street Marsh, and the Civic
Auditorium handrail and ADA accessibility upgrades.

14.26 FOCUS AREA 7 | THRIVING ORGANIZATION
FOCUS AREA 7 | PROGRESS & ACCOMPLISHMENTS
Advance a high-performing organization where employees are empowered to deliver outstanding services to the community.

Supervisor/Manager Academy Pilot
The City launched a 12-Week Supervisor and Manager Academy, providing 40 participants with practical training on recruitment, performance management, and everyday HR practices. The pilot focused on building strong, confident leaders who foster accountability, respect, and care across the organization. Participant feedback will help refine the program for citywide rollout, ensuring consistent, high-quality leadership development for current and future supervisors.

Project NATE – Modernizing the City’s Core Business Systems Project NATE is the City’s multi-year initiative to replace the 20-year-old legacy Eden system with three modern platforms:

Workday for Finance and HR, SpryPoint for Utility Billing, and Cam/Am Teller for cashiering.

Phase 1 — People and Pay is on track to go live by April 2025, marking a major step toward improving payroll, HR processes, and employee self-service tools.

Phase 2 — Financials, Projects, Grants, Utility Billing, and Cashiering is scheduled for implementation in Summer 2026, completing the full transition to a streamlined, efficient, and integrated suite of systems that will support smarter workflows and better service to the community.

Supporting Workforce Development
The City supported regional workforce development through the annual Trades Day and Skilled Trades Job Fair, which together reached over 1,000 participants. These initiatives foster a stronger workplace culture and build the future-skilled workforce needed to sustain various City operations.

14.27 Improving Permitting & Licensing
The City is implementing Tyler’s Enterprise Permitting and Licensing (EPL) system, a modern platform that will replace outdated permitting tools across multiple departments. It will enable residents, contractors, and businesses to apply for permits, track progress, schedule inspections, and make payments online 24/7. Full deployment is anticipated in late FY26.

Strengthening Employee Safety
The City updated and streamlined its Injury and Illness Prevention Program (IIPP) to strengthen workplace safety and compliance across all departments. The refreshed policy ensures alignment with CalOSHA standards and emphasizes proactive safety training, clear reporting procedures, and accountability at every level.
2025 Compensation Study
The 2025 Compensation Study updated its 2021 market analysis to reflect current labor market conditions and workforce expectations. The study reviewed benchmark agencies, total compensation data, and increased mapped classifications to ensure more positions have a defined market reference.

Launched Youth Liaisons Program
The City hosted the inaugural Youth Liaisons Program
bringing high school youth into civic service. Youth were paired with City Council and staff mentors as they
experienced a variety of City initiatives and conducted individual projects over the course of the school year
culminating in a presentation to City Council.

FOCUS AREA 7 | PROGRESS & ACCOMPLISHMENTS
FOCUS AREA 7 | SPOTLIGHT
City Website Refresh
Santa Cruz launched a major Website Refresh Project to modernize its primary digital hub for residents, businesses, and visitors. The redesign introduced a cleaner, more accessible layout, streamlined navigation, and full mobile responsiveness—all aligned with the City’s new brand identity.

Investing Youth Service Corps
The City’s was awarded $2M to launch the Monterey Bay Green Youth Service Corps from the California Volunteers Youth Service Corps Grant Competition. In partnership with Central Coast Energy Services, Ecology Action, FoodWhat, and Watsonville Wetlands Watch, this 18-month City led program will employ 107 local youth. The City’s Climate Action Program will hire a youth fellow focused on community resilience and Parks and Recreation will host a youth fellow to support community garden management, sustainability, and community engagement.

14.28 FOCUS AREA 7 | FY26 SNEAK PEEK
Citywide Equitable Engagement Policy/Engage Santa Cruz
Engage Santa Cruz will introduce a citywide framework and toolkit to make public engagement more inclusive and consistent across departments. Centered on equity, accessibility, and transparency, the plan will guide how the City involves residents—especially historically underrepresented communities—in shaping local decisions and policies.

Citywide Labor Negotiations
The City engaged with all employee associations to update wages, benefits, and working conditions across eight bargaining groups that represent the City’s full-service workforce. These negotiations are central to maintaining workforce stability, supporting employee well-being, and ensuring fiscal responsibility. By early 2026, the eight labor agreements will be finalized. This effort strengthens organizational continuity and reinforces Santa Cruz’s dedication to being a supportive, equitable, and forward-looking employer.

FOCUS AREA 7 | BY THE NUMBERS
Description FY25
New Committees & Commissions and Ad Hocs 5
Number of Employees Who Attend Required Training 1,684
Average Vacancy Rate (Citywide) 7.13%
Number of Employees Who Attended Citywide Safety
Trainings 480
Participants in Annual Trades Day and Skilled Trades Job Fair Events Over 1,000

14.29 APPENDIX A | STRATEGIC GOALS & FOCUS AREAS
Strategy 1A: Identify creative and expanded revenue approaches that provide sufficient resources and facilities to deliver services and programs that reflect the uniqueness of Santa Cruz.

Strategy 1B: Identify and adopt short- and long-term services priorities and fund them within available resources.

Strategy 1C: Develop financing strategies for capital investments and deferred infrastructure needs as identified in the long-range financial plan.

Strategy 1D: Evaluate cost recovery levels and identify fees that need to be updated.

Strategy 1E: Create community participation opportunities and training to increase understanding of the City’s financial standing and transparent fiscal decision making.

Strategy 1F: Modernize financial management software to streamline and automate the Citys processes, help identify patterns and data trends, and improve accuracy.

Strategy 1G: Leverage grant funding and advocate for resources at the state and federal levels.

FOCUS AREA #1: FISCAL SUSTAINABILITY AND TRANSPARENCY Strategy 2A: Support and expand Santa Cruz s diverse and robust businesses.

Strategy 2B: Promote Downtown as a safe, youth and family-friendly center for commerce, housing, and transportation.

Strategy 2C: Implement the Downtown Plan Expansion, including a permanent arena for the Santa Cruz Warriors.

Strategy 2D: Grow events and cultural activities in the downtown, wharf and other commercial areas (i.e., midtown, westside, lower Seabright, Harvey West industrial area) to attract residents and visitors.

Strategy 2E: Activate City programs and other efforts to enhance and enliven Downtown, including along the river, and other commercial areas (for example, placemaking attractions like pop-ups, outdoor dining, public art, beautification programs).

Strategy 2F: Invest in public and green spaces to create a welcoming, safe and attractive place to spend time.

FOCUS AREA #2: STRONG BUSINESS COMMUNITIES AND A VIBRANT DOWNTOWN Strategy 3A: Support diversity in housing types and affordability levels to accommodate present and future housing needs of Santa Cruz residents.

Strategy 3B: Implement policies and programs that promote fair housing and equitable access to housing opportunities.

Strategy 3C: Certify and implement the Housing Element to increase housing production and enable increased funding eligibility.

Strategy 3D: Leverage partnerships, government resources and private financing to create affordable and transitional housing projects in the community.

Strategy 3E: Support housing production for permanent supportive housing and low-, very low-, and extremely-low income housing.

Strategy 3F: Ensure development is adequately balanced with increasing demand on City services.

FOCUS AREA #3: HOUSING Page 28

14.30 APPENDIX A | STRATEGIC GOALS & FOCUS AREAS
Strategy 4A: Reduce the presence and social and environmental impacts of encampments in the City.

Strategy 4B: Seek funding for capital investment for homelessness response.

Strategy 4C: Support efforts that increase personal responsibility as an element of program outcomes.

Strategy 4D: Contribute to the development of temporary shelter and interim housing in a manner that supports rehousing people.

Strategy 4E: Collaborate with our community partners to create a regional approach to homelessness.

Strategy 4F: Identify and leverage existing county resources and funding to connect individuals with resources.

Strategy 4G: Provide services for people at risk of eviction to prevent homelessness.

Strategy 4H: Maintain and update the Homelessness Response Action Plan, with specific focus on developing services delivery and accountability metrics.

Strategy 4I: Provide outreach services for people living outdoors and in vehicles so they can be connected to housing and support services.

Strategy 4J: Advocate with the state and federal government for improved mental health and substance use disorder support.

FOCUS AREA #4: HOMELESSNESS RESPONSE Strategy 5A: Ensure opportunities for people of all ages to stay active, keep connected, and contribute to the communitys economic, social, and cultural life.

Strategy 5B: Collaborate with stakeholders and allied agencies to find areas for increased alignment and accountability.

Strategy 5C: Evaluate and potentially establish an Integrated Health Response Team for the City.

Strategy 5D: Conduct a standards of coverage study for Fire to identify issues and needs.

Strategy 5E: Determine feasibility and funding of a regional public safety training center.

Strategy 5F: Identify opportunities for fire shared services and facilities with neighboring agencies.

Strategy 5G: Evaluate opportunities to utilize new technology, including replacement of aging radio/communication infrastructure, to enhance public safety effectiveness and efficiency.

Strategy 5H: Seek community input to better define an updated view of public safety.

Strategy 5I: Create opportunities for pro-social youth activities.

Strategy 5J: Identify and create opportunities to support and expand childcare.

FOCUS AREA #5: PUBLIC SAFETY AND COMMUNITY WELL-BEING Page 29

14.31 APPENDIX A | STRATEGIC GOALS & FOCUS AREAS
Strategy 6A: Address deferred maintenance of critical infrastructure (i.e., water facilities and resources, wharf, streets, parks and open space).

Strategy 6B: Maintain the quality of parks and other natural amenities for enjoyment of residents and visitors.

Strategy 6C: Invest in technologies to preserve, protect, and enhance current and future infrastructure.

Strategy 6D: Maintain and further develop a skilled and trained workforce that can plan, develop, implement and operate climate adapted infrastructure projects, facilities and community assets.

Strategy 6E: Improve public transportation infrastructure to increase equitable access to sustainable travel options.

Strategy 6F: Identify and prioritize needed capital investments to support climate adaptation and achieve sustainability goals.

Strategy 6G: Continue aggressively identifying and pursuing grant, public-private, and low-interest loan financing programs, including becoming educated on how to best plan and structure projects to be grant-eligible.

FOCUS AREA #6: NATURAL AND BUILT INFRASTRUCTURE Strategy 7A: Foster a positive workplace culture where all employees are valued, included, listened to, and supported.

Strategy 7B: Increase employee engagement and recognition to ensure employees are productive and feel connected.

Strategy 7C: Address recruitment and retention challenges.

Strategy 7D: Drive diversity, equity and inclusion efforts to strengthen sense of belonging among City staff.

Strategy 7E: Create opportunities for training and professional growth for employees at all levels.

Strategy 7F: Work with regional agencies (Cabrillo College, Santa Cruz City Schools, etc.) and employers to develop a more direct workforce development and recruitment pipeline for the City.

Strategy 7G: Invest in tools, policies, and training to prioritize staff safety.

Strategy 7H: Continuously improve and modernize City service delivery.

FOCUS AREA #7: THRIVING ORGANIZATION Page 30

14.32 City Council

AGENDA REPORT
DATE: 12/24/2025
AGENDA OF: 01/13/2026
DEPARTMENT: City Manager/Public Works/Water
SUBJECT: Distribution of Coast Pump Station Battery Storage Tax Credit – Budget Adjustment (CM/PW/WT)
LOCATION: Citywide
RECOMMENDATION: Motion to:
1) Approve the distribution of revenue from the Coast Pump Station Battery Storage federal investment tax credit; and
2) Adopt a resolution amending the revenues and expenditures in the FY 2026 Budget by $1,766,641 and $1,736,641, respectively, for the General Fund ($1,589,977), the Photovoltaic Systems Improvements project (c702602, $73,332), the Solar PV Expansion at Corp Yard project (c101901, $73,332), and the Carbon Fund ($30,000).

BACKGROUND: The California Public Utilities Commission's (CPUC) Self-Generation Incentive Program (SGIP) provides funds for distributed energy resources in the form of rebates.

The Equity Resiliency category of this program, funded with over $1 billion through 2024, prioritizes critical facilities in high-fire-threat areas that have experienced Public Safety Power Shut-off (PSPS) events and covers 100% of project costs.

The Water Department's Coast Pump Station (CPS), a critical facility that supplies a large portion of the City's daily water demand, qualified for the SGIP Equity Resiliency category in 2020. The City entered into initial agreements with Tesla in late 2020 for Tesla to manage the design, procurement and installation of a 1 MW battery storage system within the program rules and operate the system, all free of charge to the City. This arrangement allowed the City to benefit from resilience by providing up to 11 hours of full-capacity backup power during electrical outages, serving as the first line of defense before existing diesel generators. The other major benefit is reduced electricity costs by using the battery to charge from the grid during cheaper times of the day and for the pump station to use electricity from the battery during peak pricing periods, saving the City over $100,000 per year. The battery was operational before the 2021 fire season.

DISCUSSION: Tesla applied for and leveraged the SGIP, a federal investment tax credit enabled by the Inflation Reduction Act, and private financing to deploy the battery storage at no

15.1 cost to the City, and income generated through the rebates, credits and some small portion of operational savings makes this arrangement possible. The investment tax credit provides a 30% tax credit applied to the purchase price of the battery system. In this case, the 30% tax credit equates to $1.7 million. Tesla assigned ownership of this battery storage facility to the private financier who is eligible to receive the investment tax. However, the investment tax credit check was issued as a direct payment to the City. This arrangement is described in more detail in agenda report and the Addendum to the Agreement
As part of an addendum to the original agreement (Attachment: Agreement Addendum) with the private financier, Participant Energy, the City will issue a check to the financier’s representative, Corporate Credit Inc., for the investment tax credit minus 10% of the recovered investment tax credit, or $170k that the City will retain. Also note that the revenue received by the City also accounts for a slight difference between the amount the Agreement Addendum identified and the actual amount distributed via the check to the City.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION:

Distribution of the tax credit revenue does not constitute a project and is not subject to CEQA.

HEALTH IN ALL POLICIES (HiAP): The battery storage facility’s installation and operation aligns with the City’s Climate Action Plan 2030 and 2025-2030 Local Hazard Mitigation and Climate Adaptation Plan as an action specified in each plan. Moreover, this battery storage facility also advances equity in that it ensures that the City is able to deliver potable water to all its customers and helps reduce the cost of water service through the operational cost savings the battery generates.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: No

2. This recommendation requires a budget adjustment: Yes

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: The City received a direct payment from the Internal Revenue Service in the amount of $1,766,641, which is being held in suspense account 101-00- 0000-46921. Upon approval of the attached budget adjustment, the City will issue a check and pay on an invoice to Corporate Credit Inc. for $1,589,977. City staff identified that the City’s portion of the investment tax credit, $176,664, could provide substantial benefit to the City if distributed in multiple ways as outlined in the Budget Adjustment:
 $30,000 to be added to the internal Carbon Fund (revenue account 133-00-00-0000- 49191) for distribution to staff proposed and recommended carbon reducing projects approved annually by the City Manager, consistent with Administrative Procedural Order.
 $73,332k to be added to the Corporation Yard’s Solar project (c101901-100-2020) to expand the solar system at the Corporation Yard, which will also serve as part of the City’s cash match for the California Air Resources Board Greenzones grant, enabling cost effective and low carbon operation of fleet electric vehicle charging at the facility.  $73,332 to be added to the Bay Street Reservoir’s solar project (c702602-100-2020) to expand the solar system at Bay Street Reservoir, which offsets significant electricity demand at the U2 Pump Station, enhancing the substantial operational cost savings the existing solar system provides to the City.

15.2 Prepared By:

Tiffany Wise-West, P.E.

Sustainability and Resiliency
Officer
Submitted By:

Michelle Templeton
Assistant City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. ADDENDUM TESLA ENERGY PRODUCTS PURCHASE AGREEMENT.PDF

2. BUDGET ADJUSTMENT.PDF

15.3 Addendum
to
Tesla Energy Products Purchase Agreement
California Self-Generation Incentive Program (SGIP)
This “Addendum” is between Tesla, Inc. (“Tesla”), and the entity represented by you, as the signatory to this Agreement (“Buyer”). The Addendum consists of (1) the below Price Sheet and (2) the attached terms & conditions, and is effective on the date that you agree to this Addendum (by electronic acceptance, signature or e-mail). Buyer and Tesla may be referred to hereinafter as a “Party” or as the “Parties.”
This Addendum amends the Tesla Energy Products Purchase Agreement between Buyer and Tesla dated September 16th 2020 (“Agreement”). Buyer and Tesla agree that the Agreement, as amended by this Addendum, is in full force and effect in accordance with its terms and is hereby ratified and confirmed, and except as modified by this Addendum, all other terms and conditions of the Agreement remain unchanged.

1. Revised Price Sheet
The Price Sheet set forth in the Agreement is hereby amended and restated as follows:

Price Sheet
Buyer information
Buyer Name: City of Santa Cruz
Buyer Business Address: 1214 River S, Santa Cruz, CA 95060 Signatory Name:

Signatory Phone Number:

Tesla entity
Tesla, Inc. of 3500 Deer Creek Road, Palo Alto, CA, 94304 888-765-2489
CA CSLB 949283
Energy Products and Contract Price
Energy Storage System: 928 kW/ 3,712 kWh
Assigned SGIP Incentive: $2,847,881.00
Assigned Federal Incentive: $1,601,933.06
Contract Price: $4,449,814.06
Expected 40% Federal Incentive: $1,779,925.63 100.0%
Assigned Federal Incentive: $1,601,933.06 90.0%
Retained Portion of Federal Incentive* $ 177,992.56 10.0% Remaining Contract Balance due after Assignment: $0.00
Job No JB-95014041-00 (Coast Pump)
*retained portion of Federal Incentive to be utilized for Buyer expense reimbursement.

15.4 2. Amendment of Section 2. Section 2 of the Agreement is amended by inserting the following:
(a) The following provision is added as new Section 2.(c):
(c) In addition to qualification for the SGIP Incentive, the Parties anticipate that the Products will qualify for a “Investment Tax Credit” under Section 48 of the Internal Revenue Code of 1986, as amended, which will either be in form of a transferable credit against income taxes (“Transferable ITC”), if Buyer is a taxable entity, or in form of a direct payment (“Direct Payment,” and collectively with the “Transferable ITC,” or each, separately referred to herein as the ”Federal Incentive”), if Buyer is a non-taxable entity. The Parties agree that, due to increased Product costs based on supply chain issues and inflation, Buyer will apply for and assign to Tesla the portion of the Federal Incentive ("Assigned Federal Incentive") set forth above in the Price Sheet, which assignment enables Tesla to sell to Buyer the Product at the Contract Price set forth in the Price Sheet and Buyer shall retain the balance of the Federal Incentive set forth above in the Price Sheet ("Retained Incentive"). Buyer hereby irrevocably assigns to Tesla all of its rights to and interests in the Assigned Federal Incentive described in the Price Sheet and agrees that the Assigned Federal Incentive shall be paid on behalf of Buyer to an account determined by Tesla.

Buyer to select one of the following:
☒ Agency. Buyer hereby appoints Tesla and its assignee as Buyer's irrevocable attorney-infact for the sole purpose of applying for the Federal Incentive, including, without limitation the right to execute any documents, agreements and instruments, and to perform all acts necessary to obtain the Federal Incentive in Buyer’s name, payable directly to (a) Tesla or its assignee or (b) if the Internal Revenue Code of 1986 or regulations thereunder require payment of the Federal Incentive directly to Buyer, to Buyer for the benefit of Tesla or its assignee. If Buyer receives payment of the Federal Incentive, it shall pay Tesla or Tesla’s assignee an amount equal to the Assigned Federal Incentive within 30 days after Buyer’s receipt of the Federal Incentive.
☐ Collaboration. Buyer hereby agrees to collaborate with Tesla for the sole purpose of applying for the Federal Incentive, including, preparing and executing any documents, agreements and instruments, and to perform all acts necessary to obtain the Federal Incentive in Buyer’s name, payable directly to (a) Tesla or its assignee or (b) if the Internal Revenue Code of 1986 or regulations thereunder require payment of the Federal Incentive directly to Buyer, to Buyer for the benefit of Tesla or its assignee. If Buyer receives payment of the Federal Incentive, it shall pay Tesla or Tesla’s assignee an amount equal to the Assigned Federal Incentive within 30 days after Buyer’s receipt of the Federal Incentive.
(b) Section 2.(c) becomes Section 2.(d) and is amended as follows:
i. The words “and the Federal Incentive” are inserted in the first line of Section2.(d) after the words “SGIP Incentive.
ii. The words “or such other email address that Tesla or its assignee may provide from time to time” are inserted at the end of Section 2.(d) before the period. (c) Section 2.(d) becomes Section 2.(e).
(d) The following provision is inserted as new Section 2.(f):
(f) Buyer agrees to execute, acknowledge and deliver, and cooperate with Tesla or its assignee in executing, any and all such further assurances and other documents agreements or instruments, and take or cause to be taken all such other action, as may be reasonably necessary or requested by Tesla or its assignee from time to time to obtain and

15.5 achieve the SGIP Incentive and the Federal Incentive payments to Tesla or its assignee as set forth in this Section 2.
(e) The following provision is inserted as new Section 2.(g):
(g) Should Buyer comply with all reasonable requests by Tesla or its assignee under Section 2(f) above, Buyer shall not be liable if Tesla or its assignee do not receive the Assigned Federal Incentive or any portion thereof. Notwithstanding the foregoing, should any actively negligent or willful act by Buyer prevent Tesla or its assignee from receiving all or any part of either the Assigned SGIP Incentive or the Assigned Federal Incentive in the full amount set forth in the Price Sheet, or result in a full or partial recapture of the Assigned SGIP Incentive or Assigned Federal Incentive, Buyer will pay that portion of the Contract Price to Tesla or its assignee, which payment shall be an amount equal to the amount of Assigned SGIP Incentive or Assigned Federal Incentive not received by, or recaptured from, Tesla or its assignee. If Tesla or its assignee fails to receive, or will be obligated to repay, any amount of Assigned SGIP Incentive or Assigned Federal Incentive for reasons resulting from any actively negligent or willful act by Buyer, Tesla or its assignee will invoice Buyer and Buyer will pay such invoice within 30 days after receipt.

Signed by
Buyer:

Name:

Signature:

Title:

Date:

Tesla, Inc. (on behalf of itself and financing party
Corporate Credit, Inc):

Name:

Signature:

Title:

Date:

15.6 15.7
City of Santa Cruz

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 Clear Form
FY2026
11/25/2025
Funds currently held in a temporary suspense account will be distributed to (1) Participate Energy, the primary recipient of the battery tax credit as specified by council approved contracts and (2) across 3 separate accounts. Two projects will fund the installation or improvement of photovoltaic energy systems in Public Works and Water Department operated facilities. The remainder of the funds will be received in the City's Carbon Fund to finance employee-led decarbonization projects throughout the City. 711-70-91-7159-46927 c702602-151-1829-0 Photovoltaic Systems Improvements/Energy rebates/incentives 73,332 133-10-03-1216-46927 Energy rebates/incentives 30,000
311-10-00-9410-46927 c101901-151-1829-0 Solar PV Expansion at Corp Yard/Energy rebates/incentives 73,332 101-10-03-1217-46927 Energy rebates/incentives 1,589,977 1,766,641
711-70-91-7159-57302 c702602-100-2020-0 Photovoltaic Systems Improvements 73,332 311-10-00-9410-57290 c101901-100-2020-0 Solar PV Expansion at Corp Yard 73,332 101-10-03-1217-52199 Other professional and technical services 1,589,977 1,736,641
30,000
Tiffany
Wise-West
Digitally signed by
Tiffany Wise-West
Date: 2025.12.19
16:26:00 -08'00'
Michelle
Templeton
Digitally signed by
Michelle Templeton
Date: 2025.12.22
13:50:21 -08'00'
Digitally signed
by Emily Burton
Date: 2025.12.24
'11:23:23 -08'00
Elizabet
h Cabell
Digitally signed by
Elizabeth Cabell
Date: 2025.12.24
11:29:09 -08'00' 15.8
City Council

AGENDA REPORT
DATE: 12/22/2025
AGENDA OF: 01/13/2026
DEPARTMENT: Economic Development and Housing
SUBJECT: Navigation Center Funding Agreement – Budget Adjustment (EDH) LOCATION: District 5
RECOMMENDATION: Motion to:
1) Reauthorize the City Manager, or designee, to execute the California Department of Health Care Services (DHCS) Behavioral Health Infrastructure Bond Program Funding Agreement (PFA) and any documents, amendments or extensions of a non-substantive nature, in a form approved by the City Attorney;
2) Adopt a resolution amending the Fiscal Year 2026 budget to appropriate $30,100,000 to grant funding and match; and
3) Adopt a finding of Categorical Exemption pursuant to CEQA Guidelines Section 15332 (InFill Development Projects); and Statutory Exemptions pursuant to Cal. Welfare & Institutions Code § 5960.3(b) and Government Code § 65662 (Low Barrier Navigation Centers).

BACKGROUND: In 2022, the City purchased the site at 125 Coral Street for $3,000,000 with the intention of using it to increase the supply of emergency shelter beds within the City. The City conducted an extensive outreach campaign, the Coral Street Visioning Process, to set goals and priorities for the Coral Street Homeless Services Campus (Coral Street Campus).

The California Department of Health Care Services (DHCS) launched the Behavioral Health Continuum Infrastructure Program (BHCIP), a bond funded program, to address historic gaps in the behavioral health care continuum and meet the growing demand for services and support across the lifespan of vulnerable individuals in need. Proposition 1, the Behavioral Health Infrastructure Bond Act of 2024, created a new source of infrastructure funding in the State of California (State). All bond BHCIP projects must support people with health insurance through Medi-Cal.

The State priorities for the BHCIP, Round 1: Launch Ready Request for Applications aligned closely with the City’s goals of program development for the Navigation Center, such as:

16.1  Address urgent needs in the care continuum for people with mental health or substance use conditions, including unhoused people, veterans, older adults, and adults with disabilities.
 Invest in behavioral health and community care options that advance health equity.  Meet the needs of vulnerable populations with the greatest barriers to access, including people experiencing unsheltered homelessness and justice involvement.  Leverage County and Medi-Cal investments to support ongoing sustainability.

On November 19, 2024 the City Council passed Resolution Number NS-30,407 authorizing (1) submission of a BHCIP grant application for an amount not to exceed $30,000,000, (2) the execution of a Program Funding Agreement (PFA) and (3) the appropriation of the grant funds.

DISCUSSION: On May 6, 2025 the City received notification that the grant funding was conditionally awarded. Since this time, staff have been working with the grant administrators to prepare the PFA. On October 27, 2025 the City received the PFA which must be executed within 90 days. Although the State has been clear that no changes will be allowed to the PFA, it is being brought back to Council at this time for final review, with conditions specific to Santa Cruz. It has already been reviewed by the City Risk Manager and the City Attorney.

From the grant eligible behavioral health facilities list, the City application focused on the Adult Residential Substance Use Disorder (SUD) Treatment facility defined as a residential alcoholism or drug abuse recovery or treatment facility which is designed to serve adults and provide 24- hour, residential, non-medical, alcoholism or drug abuse recovery or treatment services. The Adult Residential SUD facility will provide services for some of the most vulnerable who are unhoused or in temporary emergency shelters. At the current time, there is a shortage of residential treatment beds within the County Continuum of Care. As a result, there are long waits, often on the street, for people to access treatment.

To be eligible for the BHCIP bond funding, a project must demonstrate “project readiness” with the threshold requirements. These requirements are site control, a sustainable business plan, a conceptual/schematic site plan, stakeholder support, demonstration of County and Medi-Cal investments to support sustainability, and a 10% match. The City was able to show site control and $2,900,000 of the required 10% match through the purchase of the property at 125 Coral Street. The remaining $100,000 match will be provided by the licensing revenue currently being collected for temporary use of the site. The City has met the other program requirements through the application submittal.

CALIFORNIA ENVIRONMENTAL QUALITY ACT (CEQA) DETERMINATION: On June 26, 2012, City Council certified the CEQA Environmental Impact Report for the City’s General Plan 2030 (“General Plan EIR”). The facility that will be constructed on the site will likely qualify for exemption under 1 or more categories, including the class 32 Categorical Exemption, which applies to infill projects that are consistent with all applicable general plan policies and zoning criteria under 14 CCR Section 15332. In addition, there is a statutory exemption from CEQA under Welfare and Institutions Code section 5960.3(b): Projects funded by Behavioral Health Continuum Infrastructure Program grants. Finally, Government Code Section 65662 states that CEQA does not apply to the approval of a “low barrier navigation center” to provide transitional housing for the homeless. Such centers are allowed by right in mixed use and nonresidential zones permitting multifamily uses.

16.2 HEALTH IN ALL POLICIES (HiAP): A navigation center is a place where people experiencing homelessness can find immediate shelter and, by entry, be provided with services that will help them connect with long-term housing options and any other services they may need. California Assembly Bill 101 defines a navigation center as a “housing first, low-barrier, temporary, service enriched shelter focused on helping homeless individuals and families to quickly obtain permanent housing. Low barrier includes best practices to reduce barriers to entry, such as allowing partners, pets, storage of personal items, and privacy. (Gov. Code Sec. 65660)” A facility for the delivery of behavioral health services, particularly substance use disorders, will fill a critical care gap for the permanent housing placement of unhoused members of our community.

FISCAL IMPACT:

1. The recommendation in this report impacts the General Fund: Yes

2. This recommendation requires a budget adjustment: Yes

3. The recommendation creates an on-going expenditure commitment: No FISCAL IMPACT DESCRIPTION: The grant application requires a 10% match. The City demonstrated $2,900,000 of the required 10% match through the purchase of the property at 125 Coral Street. The remaining $100,000 match will be provided by the licensing revenue currently being collected in the General Fund for temporary use of the site. City Council directed that the General Fund’s licensing revenue be dedicated to the development of the site for a Navigation Center.

Prepared By:

Kathryn Mintz
Development Manager
Submitted By:

Bonnie Lipscomb
Deputy City Manager
Approved By:

Matt Huffaker
City Manager
ATTACHMENTS:

1. RESO NO. NS-30,407.PDF

2. BOND BHCIP PFA.PDF

3. BUDGET ADJUSTMENT.PDF

16.3 16.4

16.5

PROGRAM FUNDING AGREEMENT
**********

SUMMARY COVER SHEET
Program Funding
Agreement ID 7690-CA BHCIP-BOND_1021_SantaCruzCoralS-01 Program Agreement
Effective Date:
[companySignerDateField_9OR6OQw]
Program Funding
Agreement Manager:

ADVOCATES FOR HUMAN POTENTIAL, INC., a Massachusetts
corporation (AHP)
490-B Boston Post Road, Sudbury, MA 01776-3365
Tel: +1 (978) 443-0055 ♦ Fax: (978) 261-1467
AHP Contracting Officer:

General Counsel
Tel: +1 (978) 443-0055 (o) | [email protected]
AHP Designated Representatives:

Steve Thronson, Senior Program Director
Tel: +1 (323) 545-6627 (o) | [email protected] Nichole Rupp, Program Director
Tel: +1 (626) 757-0009 (o) | [email protected] Sponsor: City of Santa Cruz, a California municipal corporation 809 Center Street
Santa Cruz, CA 95060
Sponsor Designated Representative:

Bonnie Lipscomb
Tel:(831) 420-5150 | [email protected]
Prime Contract
Identification:

State Department of Health Care Services
Agreement No.: 24-40117
Contract Title: California Bond Behavioral Health Continuum Infrastructure Program (Bond BHCIP)
Contract Type: Deliverable Based Program Funding Agreement Period of Performance: [Effective Date] through June 30, 2030 Consideration/Budget: Bond BHCIP Round 1 Launch Ready Program Funding Not to Exceed $30,000,000.00
Billing Terms: See Attachment E-Payment Schedule
This Program Funding Agreement (the “Agreement”) is entered into as of

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[companySignerDateField_B0y07To] (the “Effective Date”), by and between ADVOCATES FOR HUMAN POTENTIAL, INC., a Massachusetts corporation, with offices located at 490-B Boston Post Road, Sudbury, MA 01776 (“AHP”), and CITY OF SANTA CRUZ, a California municipal corporation, with offices located at 809 Center Street, Santa Cruz, CA 95060 (“City of Santa Cruz” or the “Sponsor”). AHP and the Sponsor may be referred to separately as a “Party” or collectively as “Parties.”

RECITALS
A. The State of California (the “State”), through the Department of Health Care Services (“DHCS”), has entered into an agreement with AHP, a private consulting and research firm focused on improving health and human services systems, to assist with management of the Behavioral Health Infrastructure Bond Act of 2024 funds (“Bond BHCIP Funds”) and to administer the Behavioral Health Continuum Infrastructure Program (“BHCIP” or “Program”), as amended. The agreement between DHCS and AHP shall hereinafter be referred to as the “Prime Contract;”
B. Pursuant to the requirements of BHCIP and DHCS guidelines, qualified grantees or entities shall use an award of Bond BHCIP Funds to expand the community capacity for serving persons with behavioral health disorders by the acquisition, construction, renovation, or other physical improvement of real property, infrastructure, or facilities; C. DHCS oversees BHCIP to award Bond BHCIP Funds to qualified entities to construct, acquire, and rehabilitate real estate assets to address significant crisis care gaps in California’s behavioral health (mental health and substance use disorder) infrastructure; D. In response to that certain Request for Applications for Bond BHCIP Round 1:

Launch Ready issued by DHCS on or about July 17, 2024 (the “RFA”), for the Bond BHCIP Funds, the Sponsor submitted an application (“Application”) to construct the project described in the Statement of Work, Attachment D (“SOW”), located at 125 Coral Street, Santa Cruz, CA 95060 (the “Project”); and the Sponsor has been awarded Bond BHCIP Funds for the Project in an amount not to exceed Thirty Million Dollars and Zero Cents ($30,000,000.00) (“Program Funds”); and
E. This Agreement sets forth the terms and conditions of AHP’s management and administration of the Program Funds and the Sponsor’s duties and obligations related to its receipt of Program Funds. Capitalized terms not defined herein shall have the meanings ascribed thereto in the California Welfare and Institutions Code sections 5960–5960.4.

NOW, THEREFORE, based upon the foregoing, and in consideration of the mutual covenants and agreements herein set forth, the Parties agree as follows:

ARTICLE 1.

AUTHORITY
California Assembly Bill 133 (Chapter 143, Statutes of 2021) (“AB 133”) added sections 5960–5960.45 to the California Welfare and Institutions Code, providing the statutory basis for the Program.

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The Behavioral Health Infrastructure Bond Act of 2024 (section 4, Chapter 4 of California Assembly Bill 531 (“AB 531”)), that provided, in part, for the: (a) addition of section 5965.04 to the California Welfare and Institutions Code allocating additional funding to the Program; and (b) repealed section 5960.45 from the California Welfare and Institutions Code.

DHCS, as part of the California Health and Human Services Agency, issued the RFA for the Bond BHCIP Funds, and AHP provides pre-application consultation, technical assistance, general training, and support on individual BHCIP projects, as well as management and administration of the Bond BHCIP Funds.

This Agreement is entered under the authority of and in furtherance of the Program. This Agreement is the result of the Application by the Sponsor for funding under BHCIP.

This Agreement hereby incorporates by reference the Sponsor’s approved Application, as well as any report prepared by AHP in reliance on the representations and descriptions included in that Application. This Agreement is governed by the following (collectively, the “Program Requirements”), and each of the following, as amended and in effect from time to time, is hereby incorporated by this reference as if set forth herein in full:

1.1 AB 133, including any subsequent amendments to the statutes contained therein;

1.2 AB 531, including any subsequent amendment to the statutes contained therein;

1.3 California Welfare and Institutions Code Division 5, Part 7, Chapter 1, including any subsequent amendment to the statutes contained therein;

1.4 The Behavioral Health Infrastructure Bond Act of 2024 (California Welfare and Institutions Code Division 5, Part 7, Chapter 4) including any subsequent amendment to the statutes contained therein;

1.5 The State General Obligation Bond Law (Chapter 4 (commencing with section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), including any subsequent amendments to the statutes contained therein, with the exception of subdivisions (a) and (b) of section 16727 of the Government Code;

1.6 All California State Treasurer’s Office, California Department of Finance, and Internal Revenue Service statutes, regulations, and sub-regulatory guidance applicable to bond funded programs;

1.7 The RFA, in the form attached to this Agreement as Attachment J; Notwithstanding any incorporation of the RFA into this Agreement, the parties expressly agree that the portion of Section 2.8 of the RFA providing, ‘if an applicant has a current Negotiated Indirect Cost Rate Agreement (NICRA) established with a federal cognizant agency responsible for reviewing, negotiating, and approving cost allocation plans or indirect cost proposals, then the applicant may use its current NICRA as the basis for indirect costs,’ shall not apply and is hereby excluded from this Agreement. The parties expressly agree that the applicable indirect cost rate for indirect costs shall be determined by DHCS in its sole discretion

1.8 Guidance issued by DHCS regarding the Program;

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1.9 Program Guidelines, or Program Manuals, as adopted by DHCS, and as may be amended from time to time;

1.10 The Notice of Conditional Grant Award letter issued by DHCS to the Sponsor (the “Notice of Conditional Award Letter”) attached to this Agreement as Attachment K; State Requirements attached to this Agreement as Attachment A; Certification Regarding Lobbying attached to this Agreement as Attachment B; the Sponsor Public Works Certification attached to this Agreement as Attachment C; Statement of Work attached to this Agreement as Attachment D; Payment Schedule attached to this Agreement as Attachment E; the Sponsor Compliance Certifications attached to this Agreement as Attachment F; Performance Milestones attached to this Agreement as Attachment G; Regulatory Agreement and Declaration of Restrictions (“Declaration of Restrictions”) attached to this Agreement as Attachment H; Construction Contract Addendum attached to this Agreement as Attachment I; and Facility Access Agreement attached to this Agreement as Attachment L; and

1.11 All other applicable law, including, but not limited to, California Labor Code statutes applicable to public works projects.

The Sponsor is solely responsible and liable for the Sponsor’s and the Sponsor’s subcontractors’ performance and compliance with this Agreement, the above-referenced Program Requirements, and all other local, state, and federal laws applicable to the Project.

ARTICLE 2.

TERM

2.1 This Agreement shall commence on the Effective Date and shall automatically expire concurrently with the expiration of the Prime Contract, on June 30, 2030 (the “Expiration Date”); unless, prior to the date of expiration of the Prime Contract, AHP shall assign, and DHCS shall accept, an assignment of AHP’s duties and obligations pursuant to this Agreement (the period from the Effective Date through the Expiration Date shall be referred to herein as the “Term”), unless earlier terminated by AHP or DHCS.

2.2 Upon the expiration of the Term, there shall be no extension or renewal of the Term of this Agreement, unless the Parties and DHCS otherwise agree in writing.

2.3 Notwithstanding the foregoing or anything to the contrary contained herein, AHP and/or DHCS shall have the termination rights as set forth in Article 9 and Article 10 of this Agreement.

ARTICLE 3.

PROGRAM FUNDS
The Sponsor has been awarded the Program Funds in the amount set forth in this Agreement to be used solely for the purposes set forth in this Agreement and as detailed in the SOW and for no other purposes. The Sponsor shall be responsible for any costs to complete the Project in excess of the Program Funds award amount. The Sponsor shall return any excess or remaining Program Funds to the State upon completion of the Project.

16.9

This Agreement is entered into, and the obligation to fund is made, based upon the appropriation and availability of funds from the Behavioral Health Infrastructure Fund as defined in and created pursuant to California Welfare and Institutions Code section 5965.03. In the event that this appropriation is reduced subsequent to the Effective Date of this Agreement, AHP may, with written approval from DHCS, reduce the amount of Program Funds awarded to the Sponsor or cease to provide funding and pursuant to Section 10.1 of this Agreement, terminate the Agreement.

ARTICLE 4.

CONDITIONS OF DISBURSEMENT
AHP shall disburse the Program Funds to the Sponsor for the amount of any allowable, reasonable, actual and documented Project specific fees and expenses incurred by the Sponsor on or after May 6, 2025, the date of the Notice of Conditional Award Letter, issued by DHCS to the Sponsor, upon DHCS’s determination, in its sole discretion, that the requirements described in Section 4.1 below have been satisfied.

Program Funds disbursed for real property acquisition shall be disbursed only upon satisfaction of the requirements in Section 4.1 and the additional requirements of Section 4.2 below.

Program Funds to be disbursed for construction costs, including for costs of demolition, shall be disbursed only upon satisfaction of the requirements of Section 4.1 and the additional requirements described in Section 4.3 below. Under this Agreement, “demolition” shall include, but not be limited to, the dismantling, razing, destroying, or wrecking of any building or structure, or any part thereof.

Program Funds shall be disbursed to the Sponsor for costs incurred for the Project, contingent upon the availability of Bond BHCIP Funds. The Sponsor shall submit requests for Program Funds monthly, no later than the 15th of each month. Funding requests for reimbursement shall include incurred costs no later than forty-five (45) days from the date the Sponsor incurs the expense. Such request for Program Funds must be approved and all requirements set forth in this Article 4 must be satisfied in the sole discretion of AHP and DHCS, as applicable.

Notwithstanding the foregoing, or any provisions in this Agreement to the contrary, any request for disbursement of Program Funds submitted after April 30th of any State fiscal year ending June 30th may be subject to delayed review, processing, and disbursement, without liability to AHP or DHCS.

4.1 Requirements for Disbursement of Program Funds. No Program Funds shall be released to the Sponsor for any Project costs until the Sponsor submits, and AHP and DHCS approves, the documents described below, and any additional supporting information, as may be required:

4.1.1 a fully executed copy of this Agreement, including all Attachments;

4.1.2 the Sponsor’s request for Program Funds, with all required supporting documents appended thereto;

4.1.3 an executed copy of Certification No. 2, “Related Party & Related Party Transaction Disclosure”;

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4.1.4 a completed Government Agency Taxpayer ID Form;

4.1.5 a projection model on the approved template provided to the Sponsor by AHP or DHCS presenting expected expenditures of Program Funds (“Funding Projection Survey”);

4.1.6 an authorizing resolution or set of authorizing resolutions that, in AHP’s reasonable determination, materially comports with the Program Requirements (if the Sponsor has not already submitted the same);

4.1.7 evidence in the form of account statements or other auditable financial record that the Sponsor has received Program Funds and paying fees and expenses directly related to the Project, as detailed in the Project budget attached as Schedule 1 to the SOW;

4.1.8 evidence in the form of account statements or other auditable financial record that any funds required to match the Program Funds pursuant to the RFA (“Match Funds”); or, in the event the Match Funds are an in-kind contribution, in lieu of cash, including real property upon which the Project is to be constructed or operated and/or the amount of any allowable, reasonable, actual, and documented, as determined by AHP and DHCS in their sole discretion, Project specific fees and expenses incurred by the Sponsor no more than one (1) year prior to May 6, 2025, the date of the Notice of Conditional Award (“Sunk Costs”), the value of such in-kind contribution has been approved by AHP and DHCS in their sole discretion, as may be required;

4.1.8.1 AHP and DHCS reserve the right to withhold up to twenty-five percent (25%) of total Program Funds (“Withheld Funds”) until such time as the Sponsor provides documents, in the form and substance acceptable to AHP and DHCS, verifying that the Sponsor expended its Match Funds or that the value of its in-kind contribution and/or Sunk Costs has been reviewed and approved by AHP and DHCS. If AHP and DHCS elects to exercise this right, AHP and DHCS shall inform the Sponsor of that election in writing. AHP and DHCS shall release the Withheld Funds only after the Sponsor provides documentation that adequately, as determined by DHCS, verifies that the Sponsor has expended its Match Funds or that the value of its in-kind contribution and/or Sunk Costs has been reviewed and approved by AHP and DHCS.

Withheld Funds are entirely separate and distinct from Retention Funds, as described in Section 4.3.7.1 below;

4.1.9 unless the Sponsor is acquiring real property for the construction or operation of the Project, in which event the Sponsor shall be subject to the requirements as described in Section 4.2.5.1, a copy of a recorded Declaration of Restrictions that demonstrates that the Sponsor has recorded the Declaration of Restrictions against the real property upon which the Project is to be constructed or operated shall be provided to AHP; provided that, in the event that the Project is being constructed or operated

16.11

on a leasehold interest, which lease must be for a term of not less than thirty (30) years, the Sponsor shall record the Declaration of Restrictions against the leasehold and the fee interest to the real property upon which the Project is to be constructed or operated;

4.1.10 intentionally omitted;

4.1.11 Evidence of insurance or self-insurance in the amounts and types sufficient to satisfy the requirements of Article 11 of this Agreement, subject to AHP approval, in its sole discretion;

4.1.12 certifications in the form attached as Attachment F required for the disbursements of Program Funds, which shall be submitted within sixty (60) days of the completion of each Performance Milestone set forth in Attachment G;

4.1.13 a current title report reflecting all existing liens, encumbrances, taxes owed, easements, covenants, or any other restrictions for the real property upon which the Project is to be constructed or operated. If the Sponsor’s interest in the real property upon which the Project is to be constructed or operated is a leasehold, then the Sponsor shall provide a current title report for the leasehold interest and the fee interest;

4.1.14 a signed opinion letter from the Sponsor’s legal counsel certifying that this Agreement, the Declaration of Restrictions, and the Program Requirements do not conflict with any existing contract, agreement, or other requirement applicable to the Sponsor, the property upon which the Project is to be constructed or operated, or the Project, and are otherwise enforceable against the Sponsor; and such opinion letter shall be in the form and substance acceptable to AHP, subject to DHCS’s approval in its sole discretion; or a written confirmation letter certifying that the Sponsor has reviewed a current title report reflecting all existing liens, encumbrances, taxes owed, easements, covenants, or any other restrictions for the real property upon which the Project is to be constructed or operated; has received delegated authority from the city council for the City of Santa Cruz to accept Program Funds; comply with Program Requirements; and has determined there are no other deed restrictions, including restrictions of use of the Project; and such confirmation letter shall be in the form and substance acceptable to AHP, subject to DHCS’s approval in its sole discretion; and

4.1.15 the Sponsor and DHCS have executed a Facility Access Agreement substantially in the form attached as Attachment L.

4.2 Requirements for Disbursement of Program Funds for Acquisition Costs. Program Funds granted in advance of the Sponsor expending the funds for acquisition of real property will be deposited directly into an escrow account opened by the Sponsor for the transfer of title of the real property with First American Title Insurance Company, unless another title company is approved by AHP and DHCS. No Program Funds shall be released to the Sponsor for any Project costs related to the acquisition of real property until the Sponsor satisfies the requirements

16.12

described in Section 4.1 above and the Sponsor submits, and AHP and DHCS approve, all documents described in this Section 4.2, and any additional information as may be required.

4.2.1 a fully executed purchase and sale agreement or other agreement evidencing the Sponsor’s right to acquire the property upon which the Project is to be constructed or operated;

4.2.2 a written appraisal report setting forth an opinion of fair market value of the real property upon which the Project is to be constructed or operated prepared by a certified general appraiser licensed in the State of California (“Certified Appraisal Report”), which shall be in the form and substance acceptable to AHP and DHCS;

4.2.3 intentionally omitted;

4.2.4 evidence of any additional funds necessary for the Sponsor to acquire the property upon which the Project is to be constructed if the Program Funds are not providing the full amount of the acquisition costs;

4.2.5 signed escrow instructions, approved by AHP or DHCS, providing for the following:

4.2.5.1 a Declaration of Restrictions in the form attached to this Agreement as Attachment H shall be recorded at the close of escrow against the real property upon which the Project is to be constructed or operated; and

4.2.5.2 intentionally omitted.

4.2.6 completing and signing Certification No. 8 included as part of Attachment F shall be submitted to evidence the Sponsor’s performance of required due diligence; and

4.2.7 certifications in the form of Attachment F required for the disbursements of Program Funds, which shall be submitted within sixty (60) days of the completion of each Performance Milestone set forth in Attachment G.

4.3 Requirements for Disbursement of Program Funds for Construction Costs. No Program Funds shall be released to the Sponsor for Project costs related to construction or demolition on the Project until the Sponsor satisfies the requirements described in Section 4.1 above and the Sponsor submits, and AHP and DHCS approve, all documents described below, and any additional information, as may be required:

4.3.1 the Sponsor Certification No. 1, in the form attached as Attachment F, and the Sponsor’s General Contractor’s Certification No. 12, certifying compliance with requirements related to public works projects pursuant to California Labor Code section 1720 et seq., as well as all applicable federal labor and wage laws;

16.13

4.3.2 plans and specifications for the construction work approved by AHP, as identified by the completion of Certifications Nos. 9 and 10 no later than six (6) months from the Effective Date;

4.3.3 a construction contract, as identified by the completion of Certification No. 11, based on a permitted set of construction plans with a licensed general contractor for an amount consistent with the construction costs in the approved Project budget incorporated into the SOW as Schedule 1 that incorporates the requirements of this Agreement, including, but not limited to, the prevailing wage requirements, and contains the Construction Contract Addendum in the form attached as Attachment I;

4.3.4 a copy of the Notice of Exemption for the Project filed with the county clerk of each county in which the Project is located, pursuant to the California Environmental Quality Act (“CEQA”) Guidelines section 15062 (14 CCR Section 15062);

4.3.5 copies of labor and material bonds and performance bonds for the construction work in an amount equal to one hundred percent (100%) of the cost of construction, naming AHP and DHCS as co-obligees on the bonds;

4.3.6 a written request for Program Funds on a form approved by AHP and DHCS, providing sufficient detail and with sufficient supporting documentation to permit AHP and DHCS to confirm that the request is consistent with the terms of this Agreement and the Project budget;

4.3.7 when a disbursement is requested by a Sponsor to pay any contractor in connection with the construction work, the written request must be accompanied by (a) certification by the Sponsor’s architect or project manager that the work for which disbursement is requested has been completed (although AHP reserves the right to inspect the Project and make an independent evaluation) and (b) lien releases and/or mechanics lien title insurance endorsements reasonably acceptable to AHP;

4.3.7.1 AHP and DHCS shall retain ten percent (10%) of total Program Funds to the Sponsor (“Retention Funds”) until the Sponsor submits an executed copy of Certification No. 17, “Notice of Completion and Receipt of Conditional/Unconditional Final Releases of Liens,” as set forth in Attachment F. AHP and DHCS shall release Retention Funds to the Sponsor only upon the Sponsor’s satisfaction of all applicable requirements in this Section

4.3.7.1 and the submission of Certification No. 17 in a form and substance acceptable to AHP and DHCS, and any additional supporting documentation, as may be required, subject to approval by AHP or DHCS. Retention Funds are entirely separate and distinct from Withheld Funds, as described in Section 4.1.8.1 above; and

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4.3.8 certifications in the form of Attachment F required for the disbursements of Program Funds, which shall be submitted within sixty (60) days of the completion of each Performance Milestone set forth in Attachment G.

4.4 Disbursements for Pre-construction Expenses. Notwithstanding anything to the contrary stated in this Article 4, or otherwise in this Agreement, Program Funds may be released to the Sponsor for certain pre-construction Project costs, subject to approval by AHP or DHCS in its sole discretion, provided that the Sponsor has: (i) satisfied the requirements set forth in subsections 4.1.1, 4.1.2, 4.1.3, 4.1.4, 4.1.5, 4.1.6, 4.1.7, 4.1.8, 4.1.11, 4.1.12, 4.1.14, and 4.1.15; (ii) the Project budget includes pre-construction expenses; and (iii) the planning and preconstruction phase of Project development shall be completed within ninety (90) days of the Effective Date.

4.5 Monthly Submittal of Funding Projection Survey. The Sponsor shall continue to review, update, and resubmit to AHP no later than the 15th day of each month, its Funding Projection Survey forecasting anticipated Project expenses.

ARTICLE 5.

CONSTRUCTION PROJECTS/NOTICE TO PROCEED
In the event that Program Funds are used for the performance of construction or demolition on the Project, the Sponsor shall submit an updated budget and schedule to AHP and DHCS for its approval prior to the Sponsor’s issuance of a notice to proceed to its general contractor. The updated budget and schedule shall be consistent with the final plans and specifications for the Project. The Sponsor shall not issue a notice to proceed to its general contractor until AHP and DHCS have approved the updated budget and schedule. AHP or DHCS shall use reasonable efforts to review and provide feedback on the updated budget within seven (7) business days.

Notwithstanding the foregoing, AHP or DHCS may extend the period of review and feedback, with notice to the Sponsor, for an additional thirty (30) days without any liability to the Sponsor, AHP, or DHCS.

ARTICLE 6.

PERFORMANCE
The Sponsor shall comply with the schedule set forth in the Performance Milestones in Attachment G and shall provide each certification contained in Attachment F within sixty (60) days of the completion of each Performance Milestone. The Sponsor shall provide regular progress reports to AHP but in all events at least once every thirty (30) days, including its progress toward meeting the Performance Milestones. The Project shall not be considered complete until the submission of either Certification No. 16 or Certification No. 17, as applicable, and Certification No. 18. The Sponsor may apply to AHP for an extension of any Performance Milestones or an extension to submit any required certification, which AHP may approve, provided that the Sponsor has made a showing of good cause for such an extension and provided acceptable assurances for timely completion of the remaining Performance Milestones as determined by AHP. Any extension granted by AHP shall not be effective unless granted in writing, and such writing shall be considered an amendment to this Agreement and incorporated herein. In all events, all Program Funds must be obligated and expended by June 30, 2030.

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FAILURE TO SATISFY ANY ONE OF THE CERTIFICATIONS AND/OR PERFORMANCE

MILESTONES (UNLESS SUCH PERFORMANCE MILESTONE IS EXTENDED OR

WAIVED IN WRITING BY DHCS) SHALL CONSTITUTE A BREACH OF THIS

AGREEMENT AND ENTITLE AHP TO MANDATE THE SPONSOR TO RETURN TO THE STATE OF CALIFORNIA ANY PROGRAM FUNDS DISBURSED; IN ANY SUCH

INSTANCE, AHP MAY, ONLY WITH DHCS APPROVAL, ALSO CANCEL THIS

AGREEMENT WITHOUT OWING ANY DAMAGES OR OTHER PAYMENT TO THE SPONSOR.

ARTICLE 7.

FISCAL ADMINISTRATION

7.1 Disbursements of Program Funds to the Sponsor by AHP shall be deposited in the Sponsor’s account unless such funds are to be used for acquisition of the property upon which the Project is to be constructed or operated, in which event the Program Funds shall be deposited directly into an escrow account established with a title company for the purposes of acquisition of the property upon which the Project is to be constructed or operated. All interest earned from the deposit of Program Funds shall be used by the Sponsor for eligible Program administrative activities; however, any such use shall not exceed Five Hundred Dollars ($500.00) per year.

Program Funds shall be segregated from the Sponsor’s other funds and shall only be disbursed from the Sponsor’s account for eligible Program Funds costs.

7.2 AHP has approved the Sponsor’s budget for the Project incorporated in the SOW at Attachment D, as such budget may be updated prior to issuance of a notice to proceed to the general contractor in accordance with Article 5. The Sponsor may adjust line items in the budget, including drawing upon any contingency amounts listed in the budget, only with the prior written approval from AHP and DHCS, provided that such adjustments do not increase the overall budget amount. If, upon completion of a particular phase or segment of the Project, the Program Funds allocated to that segment or phase have not been fully expended, the Program Funds allocated to the Sponsor for such segment of the Project shall remain available to the Sponsor for disbursement for subsequent segments of the Project; provided, however, in no event shall the total amount of the Program Funds available to the Sponsor exceed the amount set forth in this Agreement without a written amendment to this Agreement signed by both Parties and approved by DHCS.

7.3 The Sponsor shall notify AHP and DHCS within thirty (30) days of any changes in the work required to be performed under this Agreement, including any additions, changes, or deletions to the plans and specifications approved by AHP and DHCS. The Sponsor shall provide prior notice to AHP of any written change order before any of the following changes, additions, or deletions in work for the Project may be performed: (1) any change in the work the cost of which exceeds One Hundred Thousand Dollars ($100,000); (2) any set of changes in the work the cost of which cumulatively exceeds One Hundred Thousand Dollars ($100,000); (3) any material change in building materials or equipment, specifications, or the structural or architectural design or appearance of the Project as provided for in the plans and specifications approved by AHP; or (4) any changes in the schedule that will extend the completion date. Notice of any additions, changes, or deletions to the work shall not relieve or release the Sponsor from any other obligations under this Agreement or relieve or release the Sponsor or its surety from any surety bond.

7.4 The Sponsor shall provide AHP with an updated budget and schedule for the Project when fifty percent (50%) completion of construction work is achieved that shows all changes in

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costs and schedule from the budget and schedule provided to AHP prior to issuance of the Notice to Proceed.

7.5 Any Program Funds that were granted but have not been expended by the expiration of the Period of Performance set forth in the Summary Cover Sheet and the Attached Performance Milestones must be returned to DHCS with any accrued interest in excess of Five Hundred Dollars ($500.00) per year, which may be used pursuant to Section 7.1 for administrative activities.

Returned Program Funds shall be paid as directed by AHP or DHCS, no later than thirty (30) calendar days after the expiration of the applicable Period of Performance.

ARTICLE 8.

CHANGES TO STATEMENT OF WORK

8.1 The Sponsor shall not, without the prior written approval of DHCS, change either of the following: (i) the behavioral health purpose of the Project; or (ii) the population to be served by the Project, the foregoing, each, as described in (x) the Sponsor’s Application, and (y) the SOW.

The Sponsor shall ensure, and change as necessary, the purpose of the Project or the population to be served by the Project is tailored to provide behavioral health treatment that will meet community needs identified by local stakeholders, including the county board of supervisors, the county behavioral health director, providers of behavioral health services, and individuals who have or have had a mental health disorder or substance use disorder. As part of its review of the Sponsor’s change request, DHCS shall ensure that any requested change aligns with these community needs.

DHCS shall approve or deny the Sponsor’s request for change within thirty (30) days of DHCS’ receipt of the request. DHCS’s decision to disapprove a request to change the Sponsor’s SOW is fact-specific, and the decision shall be final and not subject to further review. The Sponsor shall submit to AHP, with a copy to DHCS, its written request to change either (i) the behavioral health purpose of the Project; or (ii) the population to be served by the Project, which shall include a detailed description of the following criteria:

8.1.1 the changes to the services or the Project that the Sponsor is requesting to make;

8.1.2 a detailed explanation of why the change is necessary and justification for how the change in the Project meets the changing behavioral health needs of the county or geographic area that the Project serves;

8.1.3 the behavioral health population, services, and needs that the Sponsor’s change will meet;

8.1.4 an attestation that the Sponsor will serve the same percentage (or more) of Medi-Cal beneficiaries as originally stated in the Sponsor’s Application;

8.1.5 anticipated additional costs of changes to the Project, including a financial plan for meeting additional costs; and

8.1.6 any other information requested by AHP or DHCS to evaluate the Sponsor’s request.

Any changes to the SOW approved by DHCS shall be provided to AHP and set forth as an amendment to this Agreement as required by Section 20.10 of this Agreement.

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8.2 The Sponsor is solely liable and responsible for any increases in costs that exceed the Program Funds. In no event shall AHP or DHCS be responsible for any costs that exceed the Program Funds amount awarded for the Project. In the event that Project costs exceed the funds that the Sponsor has available to pay such costs, the Sponsor shall within thirty (30) days of such occurrence provide for notice to AHP of the financial plan, for AHP’s approval, for meeting such additional costs, which may be approved or disapproved by DHCS, in its sole discretion. A financial plan for meeting additional costs may include the Sponsor providing additional funds for the Project or the Sponsor incurring additional debt. The Sponsor shall not incur any additional debt without the prior written approval of AHP and DHCS. A preliminary financial plan may be submitted to AHP in the form of a written confirmation that the Sponsor or designee shall request approval from the Board of Supervisors regarding the use of additional funds necessary to complete the Project. The Sponsor shall provide to AHP written confirmation of such Board of Supervisor approval within thirty (30) days of its submittal to AHP of its preliminary financial plan.

ARTICLE 9.

DEFAULT AND REMEDIES

9.1 Event of Default. Any of the following shall, after written notice by AHP or DHCS and expiration of any applicable cure period, constitute an “Event of Default” under this Agreement:

9.1.1 The Sponsor’s failure to satisfy the conditions precedent to disbursement of Program Funds, as set forth in Article 4 above, or to expend Program Funds pursuant to the terms of this Agreement;

9.1.2 The Sponsor’s failure to timely satisfy each or any of the conditions set forth in this Agreement or the Notice of Conditional Award Letter;

9.1.3 The Sponsor’s violation of any of the Program Requirements; and

9.1.4 AHP’s or DHCS’s determination of the following:

9.1.4.1 the Sponsor has concealed any material fact from AHP or DHCS related to the Sponsor, the Application, the property upon which the Project is to be constructed or operated, or the Project;

9.1.4.2 any material fact or representation, made or furnished to AHP or DHCS by the Sponsor in connection with the Application, the Notice of Conditional Award Letter, or this Agreement which shall have been untrue or misleading at the time that such fact or representation was made known to AHP, or subsequently becomes untrue or misleading at the Sponsor’s fault;

9.1.4.3 any certification provided by the Sponsor is determined to be untrue or misleading; or

9.1.4.4 any objectives or requirements of the Program cannot be met in accordance with this Agreement or within applicable timeframes, as memorialized by this Agreement.

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9.2 Right to Cure. If the breach, violation, or default pursuant to Section 9.1 is not cured to AHP’s and DHCS’s satisfaction, as determined by AHP and DHCS, subject to DHCS’s approval in its sole and absolute discretion, within thirty (30) days of notice to the Sponsor, provided in accordance with the notice requirements of this Agreement, then AHP, subject to DHCS’s approval, may declare an Event of Default under this Agreement.

9.2.1 Notwithstanding the foregoing, the Sponsor may request additional time to cure any Event of Default. AHP may, but shall not be required to, grant any such request, which request shall be subject to DHCS’s approval. AHP’s approval of the Sponsor’s request for additional time to cure shall be subject to the Sponsor’s continuing and diligent efforts to cure, and any additional cure period provided to the Sponsor shall be reasonable, as determined by AHP, subject to DHCS’s approval in its sole discretion. In no event shall any extension of the cure period exceed thirty (30) days. For the avoidance of doubt, any extension of the cure period shall be granted in writing by AHP, subject to DHCS’s approval in its sole discretion.

9.3 AHP/State/DHCS Remedies. Upon the occurrence of an Event of Default or termination, AHP and/or DHCS may take any and all actions or remedies that are available under this Agreement, in law, or in equity, including, but not limited to, the following:

9.3.1 temporarily withhold disbursement of Program Funds pending correction of the noncompliance, breach, violation, or default;

9.3.2 disallow use of Program Funds for all or part of the costs resulting from the noncompliance, breach, violation, or default;

9.3.3 wholly or partly suspend or terminate this Agreement and the Sponsor’s award of Program Funds, or disbursements thereof (any such suspension or termination of this Agreement or the Sponsor’s award of Program Funds shall be effective upon the Sponsor’s receipt of AHP or DHCS notice of termination or suspension);

9.3.4 withhold or deny further Program Funds or awards to the Sponsor;

9.3.5 require the Sponsor to return all or part of any Program Funds, including any interest earned thereon;

9.3.6 intentionally omitted;

9.3.7 any and all remedies under the Declaration of Restrictions;

9.3.8 specific performance;

9.3.9 injunctive relief;

9.3.10 recovery and completion of the Project pursuant to the payment and performance bonds; and

9.3.11 any and all other remedies allowed by law or available in equity.

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ARTICLE 10.

TERMINATION

10.1 AHP and/or DHCS shall have the right, each in its sole discretion and without prejudice to any other rights and remedies it may have under applicable law, to terminate this Agreement effective immediately upon written notice of such termination to the Sponsor if (i) an Event of Default is declared by AHP or DHCS; (ii) three (3) breaches, violations, or defaults by the Sponsor of the terms and conditions of this Agreement (whether the same or different) occur within any twelve-month period, so long as such breaches, violations, or defaults are caused by the Sponsor’s negligence or willful misconduct, and regardless of whether any or all such breaches, violations, or defaults are timely corrected; (iii) the Sponsor files a petition in bankruptcy or is adjudicated by a court of competent jurisdiction to be bankrupt or insolvent, or makes an assignment for the benefit of creditors or an arrangement pursuant to any bankruptcy law, or the Sponsor discontinues or dissolves its business, or a receiver is appointed for the Sponsor or the Sponsor’s business; (iv) any lender to the Sponsor declares a default under its loan agreement, or funds available to the Sponsor from any lender become unavailable such that the Sponsor is unable to timely satisfy obligations under this Agreement; (v) the Sponsor’s failure to provide AHP or DHCS with adequate assurances within a reasonable time that the Sponsor is financially solvent, or AHP or DHCS determines that the Sponsor is financially insecure; or (vi) Bond BHCIP Funds necessary to complete the Project are no longer available based upon a reduction in the appropriation or availability of funds from the Behavioral Health Infrastructure Fund as defined in and created pursuant to California Welfare and Institutions Code section 5965.03.

10.2 Notwithstanding the foregoing, or anything to the contrary stated herein, AHP may terminate this Agreement upon thirty (30) days’ written notice if the Prime Contract is terminated by DHCS, or if AHP is directed by DHCS to terminate this Agreement.

10.2.1 For Cause
DHCS may terminate this Agreement, in whole or in part, and be relieved of any payments should the Sponsor or Owner fail to perform the requirements of this Agreement at the time and in the manner herein provided. In the event of such termination, DHCS may proceed with the work in any manner deemed proper by DHCS. If this Agreement is terminated, in whole or in part, DHCS may require the Sponsor or Owner to transfer title to any real or personal property acquired, developed, or purchased with funds under this Agreement to DHCS, or in the case of licensed software, license, and deliver to DHCS any completed deliverables, partially completed deliverables, and any other materials, related to the terminated portion of this Agreement, including but not limited to, computer programs, data files, user and operations manuals, system and program documentation, training programs related to the operation and maintenance of the system, and all information necessary for the reimbursement of any outstanding claims subject to DHCS review and approval.

10.2.2 For Convenience
DHCS retains the option to terminate this Agreement, in whole or in part, without cause, in DHCS’s sole discretion, without penalty, provided that written notice has been delivered to the Sponsor or Owner at least fifteen (15) calendar days prior to such termination date. In the event of termination, in whole or in part, under this

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paragraph, DHCS may require the Sponsor or Owner to transfer title to any real or personal property acquired, developed, or purchased with funds under this Agreement to DHCS, or in the case of licensed software, license, and deliver to DHCS any completed deliverables, partially completed deliverables, and any other materials related to the terminated portion of this Agreement including but not limited to, computer programs, data files, user and operations manuals, system and program documentation, training programs related to the operation and maintenance of the system, and all information necessary for the reimbursement of any outstanding claims. Payment is limited to expenses necessarily incurred and approved by DHCS pursuant to this Agreement up to the date of termination.

10.3 Upon termination of this Agreement for any reason, neither AHP nor DHCS shall be liable for any work that is not performed in accordance with the Agreement. Neither AHP nor DHCS shall be responsible for any disbursement of Program Funds after the effective date of termination of this Agreement unless: (1) the Sponsor submitted to AHP a complete draw request for disbursement of a specific amount of Program Funds prior to the effective date of termination of this Agreement; and (2) AHP determines that the request is for expenses consistent with the terms of this Agreement and the Project budget. Notwithstanding the foregoing, neither AHP nor DHCS shall be responsible for any disbursement of Program Funds requested by the Sponsor after the effective date of termination of this Agreement based upon the occurrence of an Event of Default. Upon any termination, neither AHP nor DHCS shall be responsible for any damages to the Sponsor as a result of such termination.

ARTICLE 11.

INSURANCE

11.1 Insurance Requirements. The Sponsor shall continuously maintain for the duration of this Agreement, and so long as the Declaration of Restrictions is in place, the following insurance or self-insurance at, or in excess of, the limits detailed below:

11.1.1 Builder’s risk insurance, including a permission to occupy endorsement during the course of construction, and upon completion of construction, if the Project is new construction, property insurance, covering all risks of loss, excluding earthquake, flood, or other risks customarily excluded from “All-Risks” coverage, in an amount equal to full replacement cost of the Project, including all improvements, fixtures, furnishings, and equipment thereon at the time of loss.

11.1.2 If the Project is rehabilitation of an existing facility, property insurance covering all risks of loss, excluding earthquake, flood, or other risks customarily excluded from “All-Risks” coverage, in an amount equal to the full replacement costs of all improvements located on the property upon which the Project is to be constructed, including all improvements, fixtures, furnishings, and equipment thereon at the time of loss. Upon completion of the rehabilitation, any property insurance policy shall be updated to reflect the increased replacement costs resulting from the rehabilitation.

11.1.3 Workers’ compensation insurance as required by the State.

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11.1.4 Comprehensive automobile and vehicle liability insurance covering claims for injuries to members of the public and/or damages to property of others arising from use of motor vehicles, including on-site and off-site operations and owned, non-owned, or hired vehicles, with One Million Dollars ($1,000,000) combined single limits.

11.1.5 Commercial general liability insurance of not less than One Million Dollars ($1,000,000) per occurrence with an annual aggregate limit of Five Million Dollars ($5,000,000) for bodily injury and property damage liability combined. The Sponsor’s required limits may be satisfied through a combination of general liability and umbrella or excess liability policies of coverage. The commercial general liability insurance policy shall cover liabilities arising out of premises, independent contractors, products, completed operations, ongoing operations, personal and advertising injury, and liability assumed under an insured agreement. The commercial general liability insurance shall apply to each insured against whom claim is made or suit is brought subject to the Sponsor’s limit of liability. If the scope of services involves one on one activities with minors, such policy shall include or not exclude sexual assault and misconduct coverage.

11.2 Third-Party Insurance Policy Requirements. If the Sponsor elects to obtain thirdparty insurance, with the exception of Workers’ Compensation, all policies, including their Lender Loss Payable clauses, shall be endorsed to name AHP and the “State Department of Health Care Services on behalf of the State (Agreement No.: 24-40117)” as additional insureds on such thirdparty insurance with respect to the work to be performed by the Sponsor. The endorsements and policies will provide that the insurer waives its rights of subrogation, and the insurer will provide notice to AHP in writing at least thirty (30) days prior to any cancellation, material change in coverage, or intent not to renew such insurance coverage. All such insurance must be primary and non-contributory and required to respond and pay prior to any other insurance or self-insurance available.

11.3 Contractor Insurance Requirements. The Sponsor shall require its general contractor and its subcontractors to provide insurance in the amounts and form set forth above during the course of construction (except the general contractor shall not be required to maintain Builder’s Risk insurance or property insurance) and to name AHP and the “State Department of Health Care Services on behalf of the State (Agreement No.: 24-40117)” as additional insureds on all such insurance during the course of construction.

11.4 Evidence of Self-Insurance. If the Sponsor elects to maintain self-insurance, upon the request of AHP or DHCS, the Sponsor shall immediately deposit with AHP a letter, signed by an authorized Sponsor representative, certifying that the Sponsor maintains self-insurance consistent with the above requirements. The Sponsor shall certify its self-insurance maximum coverage amounts for each of the items above and whether they have individually self-insured or if they pooled self-insurance with other public entities through a joint powers agreement. Selfinsurance maximum coverage amounts shall meet or exceed the minimum coverage amounts listed for each item above. Upon AHP’s request, the Sponsor shall also provide to AHP the Department of Industrial Relations’ certificate of consent for the county to self-insure against workers’ compensation claims. The Sponsor shall maintain self-insurance consistent with the requirements set forth above at all times during the term of the Agreement and the term of the Declaration of Restrictions. Notwithstanding the expiration of this Agreement, the Sponsor shall provide to

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DHCS a new certificate of insurance evidencing its third-party insurance, or a new letter certifying its compliance with the self-insurance coverage, as provided herein, for a period not less than thirty (30) years from the date of either of the following: (i) the date of issuance of a Certificate of Occupancy, or (ii) the date of recordation of a Notice of Completion, in the official records of the county where the Project is located.

11.5 Insurance Indemnification. The Sponsor shall indemnify, defend, and hold harmless AHP and DHCS against any and all liabilities to third persons and other losses (not compensated by insurance or otherwise) and for any other costs and expenses incurred, including reasonable attorneys’ fees, judgments, settlements, or penalties, as a result of any claim or liability resulting from the failure of the Sponsor (or its lower-tier subcontractors or consultants) to maintain the insurance policies required by this Article.

11.6 Insurance Premiums. Neither AHP nor DHCS shall be responsible for any premiums, deductibles, or assessments on any insurance policy referred to in this Agreement.

11.7 Survival. The requirements to provide insurance in this Article 11 shall survive termination of this Agreement.

ARTICLE 12.

OPERATIONS
The Sponsor agrees that, in consideration of the receipt of Program Funds pursuant to the terms of this Agreement, the Sponsor shall enter into, as required by this Agreement, the Declaration of Restrictions, to be recorded against the property upon which the Project is to be constructed or operated, in a form substantially similar as attached hereto and incorporated herein by this reference as Attachment H. The Declaration of Restrictions shall by its terms restrict the development, use, and occupancy of the Project for the term of thirty (30) years, from either the date of the issuance of a Certificate of Occupancy or the recordation of a Notice of Completion in the official records of the county in which the Project is located. In addition to any requirements in the Declaration of Restrictions, the Sponsor shall comply with all applicable state, federal, and local health and safety laws and ordinances with respect to the operation and maintenance of the Project. The facility or facilities financed pursuant to this Agreement shall accept and provide services to Medi-Cal beneficiaries as patients. If the Sponsor transfers title to the Project, the Sponsor shall ensure and guarantee that the requirements of this provision transfer and bind the Sponsor’s successor in title. These rights and obligations shall survive the expiration or early termination of this Agreement and are covenants running with the Project pursuant to the Declaration of Restrictions in the form of Attachment H to be recorded against the Project. During the Term of this Agreement and the term of the Declaration of Restrictions, the Sponsor shall execute such other documents as required by DHCS to comply with the Program Requirements, including deed restrictions, covenants, and conditions recorded against the Project.

ARTICLE 13.

POLICIES AND LEGAL AUTHORITIES

13.1 The Sponsor shall comply with:

13.1.1 All California and federal law, regulations, and published guidelines, to the extent that these authorities contain requirements applicable to the

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Sponsor’s performance under this Agreement, including any applicable licensing and health and safety requirements;

13.1.2 AB 133, including any subsequent amendments to the statutes contained therein;

13.1.3 AB 531, including any subsequent amendment to the statutes contained therein;

13.1.4 California Welfare and Institutions Code Division 5, Part 7, Chapter 1, including any subsequent amendment to the statutes contained therein and any related DHCS guidance, regulations, and/or subsequent additions or amendments thereto;

13.1.5 The State Behavioral Health Infrastructure Bond Act of 2024 (California Welfare and Institutions Code Division 5, Part 7, Chapter 4) including any subsequent amendment to the statutes contained therein;

13.1.6 The State General Obligation Bond Law (Chapter 4 (commencing with section 16720) of Part 3 of Division 4 of Title 2 of the Government Code), including any subsequent amendments to the statutes contained therein, with the exception of subdivisions (a) and (b) of section 16727 of the Government Code; and

13.1.7 All California State Treasurer’s Office, California Department of Finance, and Internal Revenue Service statutes, regulations, and sub-regulatory guidance applicable to bond funded programs.

13.2 In the event the Sponsor does not comply with the terms of this Article 13, AHP shall give notice in accordance with Section 20.7 and shall have all rights set forth in Article 9 and Article 10.

ARTICLE 14.

INDEMNIFICATION

14.1 The Sponsor shall indemnify, defend, and hold harmless AHP, its directors, officers, employees, consultants, and agents, and DHCS, and its respective officers, members, supervisors, directors, officials, and employees, counsel, attorneys, and agents against liabilities to third persons and other losses (not compensated by insurance or otherwise) and for any costs and expenses incurred by AHP and DHCS, including judgments, settlements, or penalties, against all liabilities, claims, suits, demands, or liens for damages to persons or property (“Claims”) (unless such Claims arise from the gross negligence or willful misconduct of AHP or DHCS) arising out of, resulting from, or relating to, the Sponsor’s performance under this Agreement, and including, but not limited to, the following:

14.1.1 any act, omission, or statement of the Sponsor, or any person employed by or engaged under contract with the Sponsor, that results in injury (including death), loss, or damage to any person or property;

14.1.2 any failure on the part of the Sponsor to comply with applicable Program Requirements and requirements of law;

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14.1.3 any failure to maintain the insurance policies required by this Agreement or the work performed, inclusive of intellectual property infringement, if applicable, under this Agreement. Insurance coverage that may be required shall in no way lessen or limit the liability of the Sponsor under the terms of this obligation;

14.1.4 any failure on the part of the Sponsor to satisfy all claims for labor, equipment, materials, and other obligations relating to the performance of the work hereunder;

14.1.5 any injury to property or person occurring on or about the Project or the property of the Sponsor; or

14.1.6 any claims related to the use, generation, storage, release, threatened release, discharge, disposal, or presence of hazardous materials on, under, or about the property upon which the Project is to be constructed or located.

14.2 The Sponsor shall indemnify AHP and DHCS under this clause for any of the above acts attributable to its employees, consultants, agents, and/or lower-tier subcontractors engaged in performance of the work under this Agreement. AHP or DHCS shall provide timely notice of any Claim, describing in reasonable detail such facts and circumstances with respect to such Claim.

The Sponsor shall defend AHP and DHCS with counsel reasonably acceptable to AHP and DHCS.

AHP and DHCS, each, may, at its option and own expense, engage separate counsel to advise them regarding the Claim and its defense. Such counsel may attend all proceedings. The Sponsor shall not settle any Claim without the consent of AHP and DHCS, if the settlement impacts either of their interests. If the settlement does not impact either AHP’s or DHCS’ interests, the Sponsor shall provide AHP and DHCS with notice of the settlement within seven (7) days.

14.3 The Sponsor agrees to indemnify, defend, and save harmless AHP and its directors, officers, employees, consultants, and agents, and DHCS and its officers, employees, consultants, and agents from any and all claims, costs (including, but not limited to, all expenses incurred in investigating, preparing, serving as a witness in, or defending against any such claim, action, or proceeding, commenced or threatened), and losses 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 the Sponsor in the performance of this Agreement.

14.4 This indemnification shall survive the expiration or termination of the Agreement.

ARTICLE 15.

PREVAILING WAGE
Any construction work that is part of the Project is subject to state and federal prevailing wage law, including California Labor Code section 1720 et seq. The Sponsor is urged to seek professional legal advice about prevailing wage law requirements and the Sponsor’s obligations thereunder. Prior to disbursing the Program Funds, the Sponsor must sign Certification No. 1 and the Sponsor’s general contractor must sign Certification No. 12, certifying compliance with California’s prevailing wage law and all applicable wage and hours laws. The Sponsor shall also

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comply with any other labor requirements applicable to the Project as a result of other funding sources or regulatory requirements.

ARTICLE 16.

ENVIRONMENTAL CONDITIONS
The Sponsor shall provide a Phase I Environmental Site Assessment (“ESA”) for the Project, in conformance with Advancing Standards Transforming Markets (ASTM) Standard Practice E 1527, evaluating whether the Project is affected by any recognized environmental conditions. If the Phase I ESA discloses evidence of recognized environmental conditions and the Sponsor desires to proceed with the Project, the Sponsor shall provide AHP with a Phase II report and any additional reports as required by AHP and in a form acceptable to AHP. The Sponsor shall also provide an asbestos assessment and a lead-based paint report for AHP’s approval if the Project involves rehabilitation or demolition of existing improvements. Prior to disbursement of Program Funds for real property acquisition, AHP shall require the Sponsor to complete and sign Certification No. 8, certifying that all recommendations of the Phase I or Phase II ESA have been complied with or shall be complied with prior to commencement of construction. Prior to disbursement of Program Funds for any rehabilitation work, AHP shall require the Sponsor to complete and sign Certification No. 8, certifying that all asbestos and/or lead-based paint has been abated or shall be abated prior to or during the performance of any such rehabilitation work.

ARTICLE 17.

RELOCATION
The Sponsor must comply with the California Relocation Assistance Law (California Government Code section 7260 et seq.), and their implementing regulations (collectively, the “Relocation Laws”) if the Project will result in the displacement, as that term is defined in the Relocation Laws, of any persons, businesses, or farm operations. Pursuant to the Relocation Laws, the Sponsor must have a relocation plan prior to proceeding with any phase of a Project or other activity that will result in the displacement of persons, businesses, or farm operations. The Sponsor shall provide any required notices and relocation benefits in accordance with the Relocation Laws.

AHP shall require the Sponsor to complete and sign Certification No. 8, certifying that all applicable Relocation Laws have been complied with.

ARTICLE 18.

INSPECTIONS, AUDITS, AND RECORD RETENTION

18.1 AHP or any of its authorized representatives shall have the right to access any documents, papers, or other records of the Sponsor which are pertinent to the Program Funds, in the format requested by AHP and DHCS, for the purpose of performing audits, examinations, and/or review regarding compliance with the provisions of this Agreement and the Program Requirements. Such monitoring activities shall include, but are not limited to, inspection of the Sponsor’s books and records, in addition to site inspections, as AHP or DHCS deems appropriate.

18.2 AHP or DHCS may perform compliance reviews, review procedures and documents pertaining to the SOW and other elements of this Agreement, perform on-site visits, and desk reviews in order to ensure the Sponsor’s compliance with this Agreement, as well as to protect against fraud, waste, and abuse.

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18.3 The right to access records, in the format requested by AHP and DHCS, also includes timely and reasonable access, no longer than thirty (30) days, to the Sponsor’s personnel for the purpose of interview and discussion related to the requested documents and/or information.

Notwithstanding the foregoing, AHP shall use reasonable efforts to not disrupt the Sponsor’s business operations when accessing records or personnel

18.4 The right to access records, in the format requested by AHP and DHCS, is not limited to the required retention period but lasts as long as the records are retained by the Sponsor.

18.5 The Sponsor shall retain all financial records, supporting documents, statistical records, and all other records pertinent to the Project and the Program Funds for a minimum of thirty-five (35) years from the date of final payment under this Agreement, and in compliance with the July 2, 2008 General Obligation Bond Record Retention Memorandum from the California State Treasury Office, 26 C.F.R. §1.148-5(d)(6)(iii)(E), Section 7 of Attachment A of this Agreement, and all applicable Internal Revenue Service statutes, regulations, and guidance.

18.5.1 The Sponsor shall maintain the list of documents as listed in Appendix V of the Department of Finance’s “Bond Accountability and Audits” guide document. The list of documents is not exhaustive and additional documents may be requested by AHP or DHCS.

View this publication at the following:
https://dof.ca.gov/wp-content/uploads/sites/352/Programs/OSAE/Bond_Accountability_and_Audits.pdf

18.6 The Parties recognize and acknowledge that DHCS and the Sponsor are public entities subject to the Public Records Act and information exchanged between the Parties and DHCS may be subject to public disclosure and the Parties have no right to assume that such information shall be kept confidential.

18.7 Any review or inspection undertaken by AHP with reference to the Project is solely for the purpose of determining whether the Sponsor is properly discharging its obligations to DHCS and should not be relied upon by the Sponsor or by any third parties as a warranty or representation by AHP or DHCS as to the quality of the design or construction of the Project.

18.8 The Sponsor agrees that claims based upon an audit finding, that is appealed and upheld, shall be recovered by AHP and made payable to the State Department of Health Care Services by one of the following options:

18.8.1 the Sponsor’s remittance to AHP of the full amount of the audit exception within thirty (30) days of the date the audit finding is upheld; or

18.8.2 a repayment schedule which is agreeable to AHP, DHCS, and the Sponsor.

18.9 AHP reserves the right to select which option described in Sections 18.8.1 and

18.8.2 shall be employed, and AHP shall notify the Sponsor in writing of the claim procedure to be utilized. Interest on the unpaid balance of the audit finding or debt shall accrue at a rate equal to the maximum allowed by applicable law in the State of California for any such other audit findings.

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ARTICLE 19.

THIRD-PARTY BENEFICIARIES
The State, represented by DHCS in this Agreement, is a third-party beneficiary of this Agreement. The Agreement shall not be construed so as to give any other person or entity, other than the Parties and DHCS, any legal or equitable claim or right. DHCS or another authorized department or agency representing the State may enforce any provision of this Agreement to the full extent permitted in law or equity as a third-party beneficiary of this Agreement. The State may take any and all remedies available in law or equity. In the event of litigation, the State may choose to seek any type of damages available in law or equity, up to the full amount of Program Funds awarded to the Sponsor.

ARTICLE 20.

MISCELLANEOUS

20.1 Dispute Resolution.

20.1.1 In the event of a dispute, the Parties shall first try to resolve the dispute by escalating it to higher levels of management to negotiate in good faith. If negotiations are unsuccessful, any controversy, dispute, or disagreement arising out of or relating to this Agreement, its breach, or its subject matter shall be conducted in a court of competent jurisdiction in Santa Cruz County, California. Any Party bringing an action must comply with all applicable laws relating to claims against public entities, including the time limitations and manner of claim presentation prescribed by Chapter 2, commencing with section 910 of Part 3 (Claims Against Public Entities) of Division 3.6 of Title 1 of the California Government Claims Act.

20.1.2 The Sponsor shall be obligated to continue to perform pursuant to this Agreement while any dispute is pending.

20.1.3 Dispute Resolution provisions do not apply to the State.

20.2 Intentionally Omitted.

20.3 Waiver. AHP’s failure to notify the Sponsor of a breach or to insist on strict performance of any provision of this Agreement shall not constitute waiver of such breach or provision.

20.4 Remedies. No remedy in this Agreement is exclusive of any other remedy available under this Agreement, in law or equity. AHP or DHCS may seek equitable relief, including an injunction, against the Sponsor in connection with any breach or threatened breach of this Agreement.

20.5 Limitation of Liability. Except as otherwise provided in this Agreement, or by applicable law, the Sponsor waives any right to seek, and AHP and DHCS shall not be liable for, any special, consequential, or punitive damages; indirect or incidental damages; or for any loss of goodwill, profits, data, or loss of use arising out of, resulting from, or in any way connected with the performance or breach of this Agreement, even if the Sponsor advises AHP or DHCS of the possibility of any such damages.

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20.6 Relationship. The Sponsor is an independent contractor with respect to AHP and DHCS. This Agreement is not intended to create a partnership, joint venture, employment, agency, or fiduciary relationship between the Parties or between any Party and DHCS.

20.7 Notices. Unless otherwise provided in this Agreement, each Party shall deliver all notices, requests, consents, Claims, demands, waivers, and other communications required or permitted under this Agreement (each, a “Notice”) (i) in writing; (ii) exclusively by electronic mail (“email”); and (iii) sent to the other Party’s Designated Representatives at the email address(es) set forth in Section 20.7.1.1 or to such other email address(es) as a Party may designate from time to time in accordance with the requirements of this Section. Counsel for a Party may send or receive a Notice on behalf of such Party.

20.7.1 The Parties acknowledge that Notices delivered by email shall be valid and binding and shall satisfy any requirement that a Notice must be in writing under applicable law, including the California Uniform Electronic Transactions Act (Cal. Civ. Code § 1633.1 et seq.), subject to the following:

20.7.1.1 For purposes of this Agreement, “Designated Representative” means initially (i) for AHP, [email protected], and (ii) for the Sponsor, Bonnie Lipscomb at
[email protected] and Matt Huffaker at
[email protected]. A Party may change a Designated Representative only upon delivery of a Notice to the receiving Party, in accordance with the requirements of Section 20.7 -

20.7.1.3. 20.7.1.2 A Notice shall be deemed effective only upon the sending Party’s receipt of an acknowledgement of receipt from the receiving Party, which shall be established by a reply email from the receiving Party expressly confirming receipt of the Notice.

20.7.1.3 If the sending Party does not receive an acknowledgement of receipt from the other Party, receives a bounce-back, out-of-office message, or other automated response indicating non-receipt, the sending Party shall (i) re-attempt delivery to the same designated email address(es) until the other Party acknowledges receipt, or (ii) if no acknowledgement is received within a reasonable time, in the sole discretion of DHCS, deliver a Notice to the other Party by a nationally recognized overnight courier service to the address(es) set forth on the Summary Cover Sheet as an alternative. The Notice shall be deemed valid and effective on the first business day following its timely deposit with the courier service, with delivery fees prepaid for next business day delivery. The internal records of the courier service shall serve as sufficient evidence of the date of the deposit of the Notice with the courier service.

20.8 Governing Law. The place of performance of this Agreement is California and the laws of the State of California shall govern the validity, performance, enforcement, and interpretation of this Agreement. Any litigation or enforcement of an award must be brought in the appropriate federal or state court in the State of California, County of Sacramento. Each Party

16.29

consents to personal and subject matter jurisdiction and venue in such courts and waives the right to change venue with respect to any such proceeding. The Parties acknowledge that all directions issued by the forum court, including injunctions and other decrees, shall be binding and enforceable in all jurisdictions and countries.

20.9 Assignment. The Sponsor shall not assign, delegate, or otherwise transfer this Agreement or its duties or obligations in connection therewith, in whole or in part, without the prior approval of AHP and DHCS. AHP’s obligations under this Agreement shall be assignable to DHCS or DHCS’s designee upon DHCS’s request without the Sponsor’s consent. In the event that AHP assigns its obligations under this Agreement to DHCS, AHP shall make commercially reasonable efforts to transition any reasonably necessary documentation related to this Agreement to DHCS or its designee; provided, however, that AHP shall have no obligation to incur any liability nor pay fees, charges, or reimbursement in connection with any assignment, wind-down, or transition of its services hereunder.

20.10 Entire Agreement; Amendments. This Agreement constitutes the entire agreement of the Parties with respect to its subject matter. It supersedes all oral or written agreements or communications between the Parties. No understanding, agreement, modification, change order, or other matter affecting this Agreement shall be binding, unless in writing, signed by both Parties.

No handwritten changes shall be effective unless initialed by each Party.

20.11 Independent Legal and Tax Advice. AHP and the Sponsor, each, have reviewed and negotiated this Agreement using such independent legal and tax counsel as each has deemed appropriate. The Sponsor further acknowledges that it has been afforded the opportunity to obtain legal and tax advice concerning its legal and financial duties and obligations, including its state and federal tax liabilities related to its receipt of Program Funds, and hereby confirms by the execution and delivery of this Agreement that it has either done so or waived its right to do so in connection with entering into this Agreement. For the avoidance of doubt, the Sponsor shall be solely responsible for its tax liabilities related to its receipt of Program Funds.

20.12 Exhibits. The attachments, schedules, and addenda attached to this Agreement are a part of this Agreement and incorporated into this Agreement by reference.

20.13 Partial Invalidity. If any part of this Agreement is unenforceable, the remainder of this Agreement and, if applicable, the application of the affected provision to any other circumstance, shall be fully enforceable.

20.14 Captions. The headings contained herein are for convenience only and are not intended to define, limit, or describe the scope or intent of any provision of this Agreement.

20.15 Force Majeure. Neither Party shall be liable to the other for loss or damages due to failure or delay in rendering performance caused by circumstances beyond its reasonable control, if such failure could not have been overcome by the exercise of due diligence, due care, or foresight. Such circumstances may include, but are not limited to, acts of God or a public enemy; wars; acts of terrorism; riots; fires; floods; epidemics; quarantine restrictions; labor disputes; strikes; defaults of subcontractors/vendors; failure/delays in transportation; unforeseen freight embargoes; unusually severe weather; or any law/order/regulation/request of a state or local government entity, the U.S. Government, or any agency, court, commission, or other instrumentality of any such governments. Times of performance under this Agreement may be

16.30

appropriately extended for excused delays if the Party whose performance is affected promptly notifies the other of the existence and nature of such delay.

20.16 Publicity. Without prior written approval of the other, neither Party shall use the other’s name or make reference to the other Party or any of its directors, officers, employees, consultants, or agents in publications, news releases, advertising, speeches, technical papers, photographs, sales promotions, or publicity purposes of any form related to this work or data developed hereunder, unless disclosure of such materials is required by legal, accounting, or regulatory requirements beyond the disclosing Party’s reasonable control. Use of either Party’s name may be made in internal documents, annual reports, and proposals. This Section shall survive expiration/termination of this Agreement. Notwithstanding the foregoing, the Sponsor agrees that the State may use and refer to the Sponsor and the Project in any publication, news release, advertising, speech, technical paper, or for any other purposes.

20.17 Notice of Litigation. Promptly, and in any event within five (5) business days after an officer or other authorized representative of the Sponsor obtains knowledge thereof, the Sponsor shall provide written notice to AHP of (i) any litigation or governmental proceeding pending against the Sponsor which could materially adversely affect the business, operations, property, assets, condition (financial or otherwise), or prospects of the Sponsor and (ii) any other event which is likely to materially adversely affect the business, operations, property, assets, condition (financial or otherwise), or prospects of the Sponsor.

20.18 Survival. Except as otherwise stated, sections that by their terms impose continuing obligations or establish continuing rights shall be deemed to survive the expiration or termination of this Agreement.

20.19 Successors. This Agreement shall be binding upon the Parties, their successors, and assigns.

20.20 Approvals. Whenever this Agreement calls for approval by either (i) a Party or (ii) DHCS, approval shall mean prior written approval (including via email), not to be unreasonably conditioned, delayed, or withheld, unless sole discretion is expressly noted.

20.21 Timeliness. Time is of the essence in this Agreement.

20.22 Counterparts; Electronic Signatures. The Parties may sign this Agreement in several counterparts, each of which constitutes an original, but all of which together constitute one instrument. Electronic signatures are valid and shall bind the Party delivering such signature.

SIGNATURES ON THE FOLLOWING PAGE

16.31

IN WITNESS THEREOF, the Parties hereto have executed this Agreement by their duly authorized respective officers as of the day and year last written below.

AHP:

ADVOCATES FOR HUMAN
POTENTIAL, INC., a Massachusetts
corporation
SPONSOR:

CITY OF SANTA CRUZ, a California
municipal corporation
By: [companySignerSignature_i1X14Ke] By:
[counterpartySignerSignature_99wrCXV]
Name: [companySignerName_htcioAT] Name: Matt Huffaker
Title: [companySignerTitle_tNfgZcE] Title: City Manager Date: [companySignerDateField_tPrqKic] Date:
[counterpartySignerDateField_9oHoNvC]

16.32 List of Attachments

LIST OF ATTACHMENTS
Title
Attachment A – State Requirements
Attachment B – Certification Regarding Lobbying
Attachment C – The Sponsor Public Works Certification
Attachment D – Statement of Work
Attachment E – Payment Schedule
Attachment F – The Sponsor Compliance Certifications
Attachment G – Performance Milestones
Attachment H – Regulatory Agreement and Declaration of Restrictions Attachment I – Construction Contract Addendum
Attachment J – RFA
Attachment K – Notice of Conditional Award Letter
Attachment L – Facility Access Agreement

16.33 ATTACHMENT A STATE REQUIREMENTS
A-1

ATTACHMENT A

STATE REQUIREMENTS
Only the State Requirements applicable to the Sponsor’s Program Funding are included in this Attachment and inapplicable provisions have been intentionally omitted.

1. Federal Equal Opportunity Requirements.
a. The Sponsor will not discriminate against any employee or applicant for employment because of race, color, religion, sex, national origin, physical or mental handicap, disability, age or status as a disabled veteran or veteran of the Vietnam era. The Sponsor will take affirmative action to ensure that qualified applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, national origin, physical or mental handicap, disability, age or status as a disabled veteran or veteran of the Vietnam era. Such action shall include, but not be limited to the following: employment, upgrading, demotion or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and career development opportunities and selection for training, including apprenticeship. The Sponsor agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided by the Federal Government or AHP, setting forth the provisions of the Equal Opportunity clause, section 503 of the Rehabilitation Act of 1973 and the affirmative action clause required by the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (38 U.S.C. § 4212). Such notices shall state the Sponsor’s obligation under the law to take affirmative action to employ and advance in employment qualified applicants without discrimination based on their race, color, religion, sex, national origin physical or mental handicap, disability, age or status as a disabled veteran or veteran of the Vietnam era and the rights of applicants and employees.
b. The Sponsor will, in all solicitations or advancements for employees placed by or on behalf of the Sponsor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, national origin physical or mental handicap, disability, age or status as a disabled veteran or veteran of the Vietnam era.
c. The Sponsor will send to each labor union or representative of workers with which it has a collective bargaining agreement or other contract or understanding a notice, to be provided by the Federal Government or the State, advising the labor union or workers’ representative of the Sponsor’s commitments under the provisions herein and shall post copies of the notice in conspicuous places available to employees and applicants for employment.
d. The Sponsor will comply with all provisions of and furnish all information and reports required by section 503 of the Rehabilitation Act of 1973, as amended, the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (38 U.S.C. § 4212) and of the Federal Executive Order No. 11246 as amended, including by Executive

16.34 ATTACHMENT A STATE REQUIREMENTS
A-2
Order 11375, ‘Amending Executive Order 11246 Relating to Equal Employment Opportunity,’ and as supplemented by regulation at 41 C.F.R. part 60, “Office of the Federal Contract Compliance Programs, Equal Employment Opportunity, Department of Labor,” and of the rules, regulations, and relevant orders of the Secretary of Labor.
e. The Sponsor will furnish all information and reports required by Federal Executive Order No. 11246 as amended, including by Executive Order 11375, ‘Amending Executive Order 11246 Relating to Equal Employment Opportunity,’ and as supplemented by regulation at 41 C.F.R. part 60, “Office of Federal Contract Compliance Programs, Equal Employment Opportunity, Department of Labor,” and the Rehabilitation Act of 1973, and by the rules, regulations, and orders of the Secretary of Labor, or pursuant thereto, and will permit access to its books, records, and accounts by the State and its designated representatives and the Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations, and orders.
f. In the event of the Sponsor’s noncompliance with the requirements of the provisions herein or with any federal rules, regulations, or orders which are referenced herein, this Agreement may be cancelled, terminated, or suspended in whole or in part and the Sponsor may be declared ineligible for further federal and state contracts in accordance with procedures authorized in Federal Executive Order No. 11246 as amended and such other sanctions may be imposed and remedies invoked as provided in Federal Executive Order No. 11246 as amended, including by Executive Order 11375, ‘Amending Executive Order 11246 Relating to Equal Employment Opportunity,’ and as supplemented by regulation at 41 C.F.R. part 60, “Office of Federal Contract Compliance Programs, Equal Employment Opportunity, Department of Labor,” or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law. g. The Sponsor will include the provisions of Paragraphs a through g in every subcontract or purchase order unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to Federal Executive Order No. 11246 as amended, including by Executive Order 11375, ‘Amending Executive Order 11246 Relating to Equal Employment Opportunity,’ and as supplemented by regulation at 41 C.F.R. part 60, “Office of Federal Contract Compliance Programs, Equal Employment Opportunity, Department of Labor,” or section 503 of the Rehabilitation Act of 1973 or (38 U.S.C. § 4212) of the Vietnam Era Veteran’s Readjustment Assistance Act, so that such provisions will be binding upon each Sponsor or vendor. The Sponsor will take such action with respect to any subcontract or purchase order as the Director of the Office of Federal Contract Compliance Programs or AHP may direct as a means of enforcing such provisions including sanctions for noncompliance provided, however, that in the event the Sponsor becomes involved in, or is threatened with litigation by a subcontractor or vendor as a result of such direction by AHP, the Sponsor may request in writing to AHP, who, in turn, may request the United States to enter into such litigation to protect the interests of the State and of the United States.

16.35 ATTACHMENT A STATE REQUIREMENTS
A-3

2. Travel and Per Diem Reimbursement.
(Applicable if travel and/or per diem expenses are authorized to be reimbursed with Agreement funds.)
Reimbursement for travel and/or per diem expenses from AHP under this Agreement shall, unless otherwise specified in this Agreement, be at the rates currently in effect, as established by the California Department of Human Resources (CalHR), for nonrepresented state employees as stipulated in DHCS’s Travel Reimbursement Information Exhibit in Attachment A-State Requirements. If the CalHR rates change during the term of the Agreement, the new rates shall apply upon their effective date and no amendment to this Agreement shall be necessary.

Exceptions to California Department of Human Resources (CalHR) lodging rates may be approved by AHP upon the submission of a statement by the Sponsor indicating that such rates are not available to the Sponsor. No travel outside the State of California shall be reimbursed without prior authorization from DHCS. Verbal authorization should be confirmed in writing. Written authorization may be in a form including fax or email confirmation.

3. Procurement Rules.

Applicable to agreements in which equipment/property, commodities and/or supplies are furnished by AHP or DHCS or expenses for said items are reimbursed by funds with state or federal funds provided under this Agreement.
a. Equipment/Property Definitions.

Wherever the term equipment and/or property is used, the following definitions shall apply:

Major equipment/property: A tangible or intangible item having a base unit cost of Five Thousand Dollars ($5,000) or more with a life expectancy of one (1) year or more and is either furnished by DHCS or the cost is reimbursed through this Agreement. Software and videos are examples of intangible items that meet this definition.

Minor equipment/property: A tangible item having a base unit cost of less than Five Thousand Dollars ($5,000) with a life expectancy of one (1) year or more and is either furnished by DHCS or the cost is reimbursed through this Agreement. b. Government and public entities (including state colleges/universities and auxiliary organizations), whether acting as a contractor and/or subcontractor, may secure all commodities, supplies, equipment and services related to such purchases that are required in performance of this Agreement. Said procurements are subject to Paragraphs d through h of Provision 3. Paragraph c of Provision 3 shall also apply, if equipment/property purchases are delegated to subcontractors that are nonprofit organizations or commercial businesses.
c. Intentionally Omitted.
d. Intentionally Omitted.

16.36 ATTACHMENT A STATE REQUIREMENTS
A-4
e. In AHP’s sole discretion (e.g., when AHP has a need to monitor certain purchases, etc.), AHP, with DHCS approval, may require prior written authorization and/or the submission of paid vendor receipts for any purchase, regardless of dollar amount. AHP or DHCS reserves the right to either deny claims for reimbursement or to request repayment for any Sponsor purchase that AHP or DHCS determines to be unnecessary in carrying out performance under this Agreement. f. The Sponsor must maintain a copy or narrative description of the procurement system, guidelines, rules, or regulations that will be used to make purchases under this Agreement. AHP and the State reserves the right to request a copy of these documents and to inspect the purchasing practices of the Sponsor at any time. g. For all purchases, the Sponsor must maintain copies of all paid vendor invoices, documents, bids and other information used in vendor selection, for inspection or audit. Justifications supporting the absence of bidding (i.e., sole source purchases) shall also be maintained on file by the Sponsor for inspection or audit. h. AHP may, with cause (e.g., with reasonable suspicion of unnecessary purchases or use of inappropriate purchase practices, etc.), and DHCS approval, withhold, cancel, modify, or retract the delegated purchase authority granted under Paragraphs b and/or c of Provision 3 by giving the Sponsor no less than thirty (30) calendar days written notice.

4. Equipment/Property Ownership/Inventory/Disposition.
(Applicable to agreements in which equipment/property is furnished by DHCS and/or AHP when said items are purchased or reimbursed by DHCS with state or federal funds provided under this Agreement.)
a. Wherever the term equipment and/or property is used in Provision 4, the definitions in Paragraph a of Provision 3 shall apply.

Unless otherwise stipulated in this Agreement, all equipment and/or property that is purchased/reimbursed with Agreement funds or furnished by AHP under the terms of this Agreement shall be considered state equipment and the property of DHCS, unless a waiver is granted.
(1) Reporting of Equipment/Property Receipt - DHCS requires the reporting, tagging and annual inventorying of all equipment and/or property that is furnished by AHP or DHCS, or purchased or reimbursed with funds provided through this Agreement.

Upon receipt of equipment and/or property, the Sponsor shall report the receipt to the AHP.

To report the receipt of said items and to receive property tags, the Sponsor shall use a form or format designated by AHP. If the appropriate form does not accompany this Agreement, the Sponsor shall request a copy from AHP.
(2) Annual Equipment/Property Inventory - If the Sponsor enters into an agreement with a term of more than twelve months, the Sponsor shall

16.37 ATTACHMENT A STATE REQUIREMENTS
A-5
submit an annual inventory of state equipment and/or property to the AHP using a form or format designated by AHP. If an inventory report form does not accompany this Agreement, the Sponsor shall request a copy from AHP.

The Sponsor shall:
(a) Include in the inventory report, equipment and/or property in the Sponsor’s possession and/or in the possession of a subcontractor (including independent consultants).
(b) Submit the inventory report to AHP according to the instructions appearing on the inventory form or issued by AHP.
(c) Contact AHP to learn how to remove, trade-in, sell, transfer or survey off, from the inventory report, expired equipment and/or property that is no longer wanted, usable or has passed its life expectancy. Instructions will be supplied by AHP.
b. Title to state equipment and/or property shall not be affected by its incorporation or attachment to any property not owned by the State.
c. Unless otherwise stipulated, AHP or DHCS shall be under no obligation to pay the cost of restoration, or rehabilitation of the Sponsor’s facility which may be affected by the removal of any state equipment and/or property.
d. The Sponsor shall maintain and administer a sound business program for ensuring the proper use, maintenance, repair, protection, insurance and preservation of state equipment and/or property.
(1) In administering this provision, AHP may require the Sponsor to repair or replace, to AHP’s satisfaction, any damaged, lost or stolen state equipment and/or property. In the event of state equipment and/or miscellaneous property theft, the Sponsor shall immediately file a theft report with the appropriate police agency or the California Highway Patrol and the Sponsor shall promptly submit one copy of the theft report to AHP. e. Unless otherwise stipulated by the Program funding this Agreement, equipment and/or property purchased/reimbursed with agreement funds or furnished by AHP under the terms of this Agreement, shall only be used for performance of this Agreement or another DHCS agreement, with prior approval only. f. Within sixty (60) calendar days prior to the termination or end of this Agreement, the Sponsor shall provide a final inventory report of equipment and/or property to AHP and shall, at that time, query DHCS as to the requirements, including the manner and method, of returning state equipment and/or property to AHP. Final disposition of equipment and/or property shall be at AHP’s expense and according to AHP’s instructions. Equipment and/or property disposition instructions shall be issued by AHP immediately after receipt of the final inventory report. At the termination or conclusion of this Agreement, AHP OR DHCS may at its discretion,

16.38 ATTACHMENT A STATE REQUIREMENTS
A-6
authorize the continued use of state equipment and/or property for performance of work under a different DHCS agreement.

5. Subcontract Requirements.
a. Intentionally Omitted.
b. DHCS reserves the right to (i) approve or disapprove the selection of subcontractors, where any such DHCS approval or disapproval may be communicated to the Sponsor by AHP, and (ii) with advance written notice, require the substitution of subcontractors and require the Sponsor to terminate subcontracts entered into in support of this Agreement. DHCS shall consult with the Sponsor prior to issuing a final disapproval of a subcontractor. (1) Upon receipt of a written notice from AHP requiring the substitution and/or termination of a subcontract, the Sponsor shall take steps to ensure the completion of any work in progress and select a replacement, if applicable, within sixty (60) calendar days, unless a longer period is agreed to by DHCS. DHCS shall consult with the Sponsor prior to issuing a final disapproval of a subcontractor.
c. DHCS in its sole discretion, may elect to require that all actual subcontracts (i.e., written agreement between the Sponsor and a subcontractor) of Fifty Thousand Dollars ($50,000) or more shall be subject to DHCS prior review and written approval. Any such DHCS election shall be confirmed in writing by DHCS. d. The Sponsor shall maintain a copy of each subcontract entered into in support of this Agreement and shall, upon request by AHP or DHCS, make copies available for approval, inspection, or audit.
e. AHP assumes no responsibility for the payment of subcontractors used in the performance of this Agreement. The Sponsor accepts sole responsibility for the payment of subcontractors used in the performance of this Agreement. f. The Sponsor is responsible for all performance requirements under this Agreement even though performance may be carried out through a subcontract. g. The Sponsor shall ensure that all subcontracts for services include provision(s) requiring compliance with applicable terms and conditions specified in this Agreement.
h. The Sponsor agrees to include the following clause, relevant to record retention, in all subcontracts for services:

The Sponsor agrees to maintain and preserve, until three years after termination of this Agreement and final payment from AHP, to permit AHP or DHCS or any duly authorized representative, to have access to, examine

16.39 ATTACHMENT A STATE REQUIREMENTS
A-7
or audit any pertinent books, documents, papers and records related to this subcontract and to allow interviews of any employees who might reasonably have information related to such records.
i. Unless otherwise stipulated in writing by AHP, AHP shall be the Sponsor’s sole point of contact for all matters related to performance and payment under this Agreement.
j. The Sponsor shall, as applicable, advise all subcontractors of their obligations to comply with this Attachment A.

6. Intentionally Omitted.

7. Audit and Record Retention.
a. The Sponsor shall maintain books, records, documents, and other evidence, accounting procedures and practices, sufficient to properly reflect all direct and indirect costs of whatever nature claimed to have been incurred in the performance of this Agreement, including any matching costs and expenses. The foregoing constitutes “records” for the purpose of this provision. b. The Sponsor shall maintain records in a data storage medium that is accessible to AHP and DHCS. DHCS, at its sole discretion, shall determine whether the Sponsor’s type of data storage medium meets this accessibility requirement. c. The Sponsor shall maintain the list of documents as listed in Appendix V of the “Bond Accountability and Audits” guide document. View this publication at the following:
https://dof.ca.gov/wpcontent/uploads/sites/352/Programs/OSAE/Bond_Accountability_and_Audits.pdf d. The Sponsor’s facility or office or such part thereof as may be engaged in the performance of this Agreement and his/her records shall be subject at all reasonable times to inspection, audit, and reproduction.
e. The Sponsor agrees that AHP, DHCS, the Department of General Services, the Bureau of State Audits, or their designated representatives including the Comptroller General of the United States shall have the right to review and to copy any records and supporting documentation pertaining to the performance of this Agreement. The Sponsor 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 Sponsor agrees to include a similar right of the State to audit records and interview staff in any subcontract related to performance of this Agreement. (Cal. Gov. Code, § 8546.7; Cal. Code Regs., tit. 2, § 1896.77.)
f. The Sponsor shall preserve and make available his/her records (1) for a period of thirty-five (35) years from the date of final payment under this Agreement, and (2)

16.40 ATTACHMENT A STATE REQUIREMENTS
A-8
for such longer period, if any, as is required by applicable statute, by any other provision of this Agreement, or by subparagraphs (1) or (2) below. (1) If this Agreement is completely or partially terminated, the records relating to the work terminated shall be preserved and made available for a period of thirty-five (35) years from the date of any resulting final settlement. (2) If any litigation, claim, negotiation, audit, or other action involving the records has been started before the expiration of the thirty-five (35) year period, the records shall be retained until completion of the action and resolution of all issues which arise from it, or until the end of the regular thirty-five (35) year period, whichever is later.
g. The Sponsor may, following receipt of final payment under this Agreement, submit a request to AHP and DHCS to reduce its accounts, books and records related to this Agreement to CD ROM, DVD, or other data storage medium accessible to AHP and DHCS. DHCS, at its sole discretion, may approve or deny this request.

Upon request by an authorized representative to inspect, audit or obtain copies of said records, the Sponsor must supply or make available applicable devices, hardware, and/or software necessary to view, copy and/or print said records. h. The Sponsor shall, if applicable, comply with the Single Audit Act and the audit requirements set forth in 2 C.F.R. § 200.501 (2014).

8. Site Inspection.

The State has the right at all reasonable times to inspect or otherwise evaluate the work performed or being performed hereunder including subcontract supported activities and the premises in which it is being performed. If any inspection or evaluation is made of the premises of the Sponsor, the Sponsor shall provide and shall require Sponsors to provide all reasonable facilities and assistance for the safety and convenience of the authorized representatives in the performance of their duties. All inspections and evaluations shall be performed in such a manner as will not unduly delay the work.

9. Intentionally Omitted.

10. Intentionally Omitted.

11. Warranties.

The Sponsor represents and warrants that:
a. It is free to enter into and fully perform this Agreement. b. It has secured and will secure all rights and licenses necessary for its performance of this Agreement.

16.41 ATTACHMENT A STATE REQUIREMENTS
A-9
c. It has not granted and shall not grant to any person or entity any right that would or might derogate, encumber, or interfere with any of the rights granted to AHP or DHCS in this Agreement.
d. It has appropriate systems and controls in place to ensure that State funds will not be used in the performance of this Agreement for the acquisition, operation or maintenance of computer software in violation of copyright laws. e. It has no knowledge of any outstanding claims, licenses or other charges, liens, or encumbrances of any kind or nature whatsoever that could affect in any way the Sponsor’s performance of this Agreement.
f. All materials and equipment furnished with respect to the Project and all work performed by the Sponsor will be of good and workmanlike quality, free from faults and defects, and in conformance with the Agreement.
g. It shall comply with all applicable laws in connection with its performance of its obligations under this Agreement.
h. Intentionally Omitted.
i. It shall disclose to AHP and/or DHCS, during the Term of this Agreement, promptly upon the existence or discovery of the existence of an actual or potential transaction, agreement, or settlement with any entity, member, manager, partner, or person that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control with the Sponsor (“Related Party” or “Related Parties”) in connection with the Project (“Related Party Transaction”). j. It shall disclose to AHP and/or DHCS, during the Term of this Agreement, promptly upon the existence or discovery of the existence of a Related Party or a Related Party Transaction: (1) the nature of the relationship, (2) the nature of the potential or actual transaction, agreement, or settlement, (3) the dollar amounts of any such transaction, agreement, or settlement, (4) the dollar amounts due to or from a Related Party, and (5) documents and any additional information, as may be required by AHP and/or DHCS in their sole discretion.
k. The provisions set forth herein shall survive any termination or expiration of this Agreement or any Project schedule.

12. Intentionally Omitted.

13. Prior Approval of Training Seminars, Workshops or Conferences.

The Sponsor shall obtain prior AHP approval of the location, costs, dates, agenda, instructors, instructional materials, and attendees at any reimbursable training seminar, workshop, or conference conducted pursuant to this Agreement and of any reimbursable publicity or educational materials to be made available for distribution. The Sponsor shall acknowledge the support of the State whenever publicizing the work under this Agreement in any media. This

16.42 ATTACHMENT A STATE REQUIREMENTS
A-10
provision does not apply to necessary staff meetings or training sessions held for the staff of the Sponsor to conduct routine business matters.

14. Confidentiality of Information.
a. The Sponsor and its employees, agents, or subcontractors shall protect from unauthorized disclosure names and other identifying information concerning persons either receiving services pursuant to this Agreement or persons whose names or identifying information become available or are disclosed to the subcontractors as a result of services performed under this Agreement, except for statistical information not identifying any such person. b. The Sponsor and its employees, agents shall not use such identifying information for any purpose other than carrying out the Sponsor’s obligations under this Agreement.
c. The Sponsor and its employees, agents shall promptly transmit to the AHP Contract Office or Project Manager all requests for disclosure of such identifying information not emanating from the client or person.
d. The Sponsor shall not disclose, except as otherwise specifically permitted by this Agreement or authorized by the client, any such identifying information to anyone other than AHP without prior written authorization from the AHP Contract Office or Project Manager, except if disclosure is required by State or Federal law. e. For purposes of this provision, “identity” shall include, but not be limited to name, identifying number, symbol, or other identifying particular assigned to the individual, such as finger or voice print or a photograph. f. As deemed applicable by AHP or DHCS, this provision may be supplemented by additional terms and conditions covering personal health information (PHI) or personal, sensitive, and/or confidential information (PSCI). Said terms and conditions will be outlined in one or more exhibits that will either be attached to this Agreement or incorporated into this Agreement by reference.

15. Intentionally Omitted.

16. Intentionally Omitted.

17. Intentionally Omitted.

18. Intentionally Omitted.

19. Novation.

If the Contractor proposes any novation agreement, DHCS shall act upon the proposal within sixty (60) days after receipt of the written proposal. DHCS may review and consider the proposal, consult and negotiate with the Contractor, and accept or reject all or part of the proposal.

Acceptance or rejection of the proposal may be made orally within the sixty (60)-day period and

16.43 ATTACHMENT A STATE REQUIREMENTS
A-11
confirmed in writing within five (5) days of said decision. Upon written acceptance of the proposal, DHCS will initiate an amendment to this Agreement to formally implement the approved proposal.

20. Intentionally Omitted.

21. Intentionally Omitted.

22. Intentionally Omitted.

23. Intentionally Omitted.

24. Intentionally Omitted.

25. Officials Not to Benefit.

No members of or delegate of Congress or the State Legislature shall be admitted to any share or part of this Agreement or to any benefit that may arise therefrom. This provision shall not be construed to extend to this Agreement if made with a corporation for its general benefits.

26. Intentionally Omitted.

27. Intentionally Omitted.

28. Intentionally Omitted.

29. Intentionally Omitted.

30. Intentionally Omitted.

31. Intentionally Omitted.

32. Suspension or Stop Work Notification.
a. AHP, only with the approval from DHCS, may, at any time, issue a notice to suspend performance or stop work under this Agreement. The initial notification may be a verbal or written directive issued by the funding Program’s Contract Manager. Upon receipt of said notice, the Sponsor is to suspend and/or stop all, or any part, of the work called for by this Agreement.
b. Written confirmation of the suspension or stop work notification with directions as to what work (if not all) is to be suspended and how to proceed will be provided within thirty (30) working days of the verbal notification. The suspension or stop work notification shall remain in effect until further written notice is received from AHP or DHCS. The resumption of work (in whole or part) will be at AHP’s or DHCS’ discretion and upon receipt of written confirmation. (1) Upon receipt of a suspension or stop work notification, the Sponsor shall immediately comply with its terms and take all reasonable steps to minimize or halt the incurrence of costs allocable to the performance covered by the notification during the period of work suspension or stoppage.

16.44 ATTACHMENT A STATE REQUIREMENTS
A-12
(2) Within ninety (90) days of the issuance of a suspension or stop work notification, AHP or DHCS shall either:
(a) Cancel, extend, or modify the suspension or stop work notification; or
(b) Terminate the Agreement as provided for in the Cancellation / Termination clause of the Agreement.
c. If a suspension or stop work notification issued under this clause is canceled or the period of suspension or any extension thereof is modified or expires, the Sponsor may resume work only upon written concurrence of AHP or DHCS. d. If the suspension or stop work notification is cancelled and the Agreement resumes, changes to the services, deliverables, performance dates, and/or agreement terms resulting from the suspension or stop work notification shall require an amendment to the Agreement.
e. If a suspension or stop work notification is not canceled and the Agreement is cancelled or terminated pursuant to the provision entitled Cancellation/ Termination, AHP or DHCS shall allow reasonable costs resulting from the suspension or stop work notification in arriving at the settlement costs. f. AHP and DHCS, each individually, and collectively, shall not be liable to the Sponsor for loss of profits because of any suspension or stop work notification issued under this clause.

33. Intentionally Omitted.

34. Compliance with Statutes and Regulations.
a. The Sponsor shall comply with all California and federal law, regulations, and published guidelines, to the extent that these authorities contain requirements applicable to the Sponsor’s performance under the Agreement. b. These authorities include, but are not limited to, Title 2, Code of Federal Regulations (CFR) Part 200, subparts D, E, and F, Appendix II; Title 42 CFR Part 431, subpart F; Title 42 CFR Part 433, subpart D; Title 42 CFR Part 434; Title 45 CFR Part 75, subpart D; and Title 45 CFR Part 95, subpart F. To the extent applicable under federal law, this Agreement shall incorporate the contractual provisions in these federal regulations and they shall supersede any conflicting provisions in this Agreement.

35. Intentionally Omitted.

16.45 ATTACHMENT B CERTIFICATION REGARDING LOBBYING
B-1

ATTACHMENT B
STATE of California
Department of Health Care Services

CERTIFICATION REGARDING LOBBYING
The undersigned certifies, to the best of his or her knowledge and belief, that:

1. No Federal appropriated funds have been paid or will be paid, by or on behalf of the undersigned, to any person for influencing or attempting to influence an officer or employee of an agency, a Member of Congress, an officer of employee of Congress, or an employee of a Member of Congress in connection with the making, awarding, or entering into of this Federal contract, Federal grant, or cooperative agreement, and the extension, continuation, renewal, amendment, or modification of this Federal contract, grant or cooperative agreement.

2. If any funds other than Federal appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency of the United States Government, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with this Federal contract, grant or cooperative agreement, the undersigned shall complete and submit Standard Form LLL, “Disclosure of Lobbying Activities” in accordance with its instructions.

3. The undersigned shall require that the language of this certification be included in the award documents for all subawards at all tiers (including subcontractors, subgrants, and contracts under grants and cooperative agreements) of One Hundred Thousand Dollars ($100,000) or more, and that all subrecipients shall certify and disclose accordingly.

This certification is a material representation of fact upon which reliance was placed when this transaction was made or entered into. Submission of this certification is a prerequisite for making or entering into this transaction imposed by § 1352, Title 31, U.S.C., any person who fails to file the required certification shall be subject to a civil penalty of not less than Ten Thousand Dollars ($10,000) and not more than One Hundred Thousand Dollars ($100,000) for each such failure.

City of Santa Cruz, a California municipal
corporation
Matt Huffaker
Name of the Sponsor Printed Name of Person Signing for Sponsor BR1-25-4401 [counterpartySignerSignature_g5A0ktu]
Contract Number Signature of Person Signing for Sponsor [counterpartySignerDateField_kYISVje] City Manager
Date Title

16.46 ATTACHMENT B CERTIFICATION REGARDING LOBBYING
B-2
After execution by or on behalf of the Sponsor, please return to: California Department of Health Care Services

CERTIFICATION REGARDING LOBBYING
Complete this form to disclose lobbying activities pursuant to 31 U.S.C. 1352 [counterpartySignerCheckbox_zsFT3Nj||13] Check this box if not applicable

1. Type of Federal Action:
[counterpartySignerCheckbox_wc
45fIE||14] Contract
[counterpartySignerCheckbox_xu
0OhAu||15] Grant
[counterpartySignerCheckbox_Jc
20WYC||16] Cooperative
Agreement
[counterpartySignerCheckbox_5T
dehah||17] Loan
[counterpartySignerCheckbox_dr
vhlHy||18] Loan guarantee
[counterpartySignerCheckbox_Sh
Ir6te||19] Loan insurance

2. Status of Federal Action:
[counterpartySignerCheckbox_u5LCJ7Q||2
0] bid/offer/application
[counterpartySignerCheckbox_VuzvI0Z||2
1] initial award
[counterpartySignerCheckbox_loyVQ5Q||2
2] post-award
a.

3. Report Type:
[counterpartySignerCheckb
ox_24A1pjs||23] Initial
filing
[counterpartySignerCheckb
ox_GERmaWz||24]
Material change
For Material Change Only:

Year
[counterpartySignerTextFiel
d_sef5I19||1] Quarter
[counterpartySignerTextFiel
d_eZIGHlP||2]
Date of Last Report
[counterpartySignerTextFiel
d_nJgKdGy||3]

4. Name and Address of
Reporting Entity:
[counterpartySignerCheckbox_A
dvgiZa||25]Prime
[counterpartySignerCheckbox_rC
n2QeT||26]Subawardee
Tier[counterpartySignerTextField
_EZTuDmB||6], if known
Congressional District, if known:
[counterpartySignerTextField_c6
KJ9te||7]

5. If Reporting Entity in No. 4 is a Subawardee, Enter Name and Address of Prime:
[counterpartySignerTextField_oNJBP11||5]
Congressional District, if known:
[counterpartySignerTextField_6m60mns||4]

6. Federal
Department/Agency:[counterpa
rtySignerTextField_GyvwQ26||
8]

2. 7. Federal Program
Name/Description:[counterpartySignerTextField_wIJkxHD||9]

16.47 ATTACHMENT B CERTIFICATION REGARDING LOBBYING
B-3
CFDA Number, if applicable:
[counterpartySignerTextField_0ocUtMC||10]

8. Federal Action Number, if
known:
[counterpartySignerTextField_
eWvQASH||14]

3. 9. Award Amount, if known:

4. $[counterpartySignerTextField_emgAqdi||11]
10a. Name and Address of
Lobbying Registrant
(If individual, last name, first
name, MI):
[counterpartySignerTextField_Jzj
BTig||12]
10b. Individuals Performing Services (including address if different from 10a.) (last name, first name,
MI):[counterpartySignerTextField_MboMvXa||13]

11. Information requested
through this form is authorized
by title 31 U.S.C. section 1352.

This disclosure of lobbying
activities is a material
representation of fact upon
which reliance was placed by
the tier above when this
transaction was made or
entered into. This disclosure is
required pursuant to 31 U.S.C.
1352. This information will be
available for public inspection.

Any person that fails to file the
required disclosure shall be
subject to a fine not to exceed
$100,000 for each such failure.

Signature: [counterpartySignerSignature_K0YRYfU]
Print Name: Matt Huffaker
Title: City Manager
Telephone No. (831) 420-5150
Date: [counterpartySignerDateField_2QedCeM]

INSTRUCTIONS FOR COMPLETION OF SF-LLL,

DISCLOSURE OF LOBBYING ACTIVITIES
This disclosure form shall be completed by the reporting entity, whether subawardee or prime Federal recipient, at the initiation or receipt of a covered Federal action, or a material change to a previous filing, pursuant to U.S.C. §1352. The filing of a form is required for each payment or agreement to make payment to any lobbying entity for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with a covered Federal action. Complete all items that apply for both the initial filing and material change report. Refer to the implementing guidance published by the Office of Management and Budget for additional information.

16.48 ATTACHMENT B CERTIFICATION REGARDING LOBBYING
B-4

1. Identify the type of covered Federal action for which lobbying activity is and/or has been secured to influence the outcome of a covered Federal action.

2. Identify the status of the covered Federal action.

3. Identify the appropriate classification of this report. If this is a follow-up report caused by a material change to the information previously reported, enter the year and quarter in which the change occurred. Enter the date and of the last previously submitted report by this reporting entity for this covered Federal action.

4. Enter the full name, address, city, state and zip code of the reporting entity. Include Congressional District, if known. Check the appropriate classification of the reporting entity that designates if it is, or expects to be a prime or subaward recipient. Identify the tier of the subawardee, e.g., the first subawardee of the prime is the first tier. Subawards include but are not limited to subcontracts, subgrants and contract awards under grants.

5. If the organization filing the report in item 4 checks “Subawardee”, then enter the full name, address, city, state and zip code of the prime Federal recipient. Include Congressional District, if known.

6. Enter the name of the Federal agency making the award or loan commitment. Include at least one organizational level below agency name, in known. For example, Department of Transportation, United States Coast Guard.

7. Enter the Federal program name or description for the covered Federal action (item 1). If known, enter the full Catalog of Federal Domestic Assistance (CFDA) number for grants, cooperative agreements, loans, and loan commitments.

8. Enter the most appropriate Federal identifying number available for the Federal action identified in Item 1 (e.g., Request for Proposal (RFP) number; Invitation for Bid (IFB); grant announcement number; the contract, grant or loan award number; the application/proposal control number assigned by the Federal agency). Include prefixes, e.g., “RFP-DE-90-001.”

9. For a covered Federal action where there has been an award or loan commitment by the Federal agency, enter the Federal amount of the award/loan commitment for the prime entity identified in item 4 or 5.

10. (a) Enter the full name, address, city, state and zip code of the lobbying registrant under the Lobbying Disclosure Act of 1995 engaged by the reporting entity identified in item 4 to influence the covered Federal action.
(b) Enter the full names of the individual(s) performing services, and include full address if different from 10(a). Enter Last Name, First Name, and Middle Initial (MI).

11. The certifying official shall sign and date the form, print his/her name, title and telephone number.

According to the Paperwork Reduction Act, as amended, no persons are required to respond to a collection of information unless it displays a valid OMB Control Number. The valid OMB control number for this information collection is OMN No. 0348-0046. Public reporting burden

16.49 ATTACHMENT B CERTIFICATION REGARDING LOBBYING
B-5
for this collection of information is estimated to average 10 minutes per response, including time for reviewing instructions, searching existing data sources, gathering and maintaining the data needed, and completing and reviewing the collection of information. Send comments regarding the burden estimate or any other aspect of this collection of information, including suggestions for reducing this burden, to the Office of Management and Budget, Paperwork Reduction Project (0348-0046), Washington, DC 20503.

16.50 ATTACHMENT C THE SPONSOR PUBLIC WORKS CERTIFICATION C-1

ATTACHMENT C

THE SPONSOR PUBLIC WORKS CERTIFICATION
The Sponsor Certification Clause
CCC 04/2017

CERTIFICATION
I, the official named below, CERTIFY UNDER PENALTY OF PERJURY that I am duly authorized to legally bind the prospective Sponsor to the clause(s) listed below. This certification is made under the laws of the State of California.

Sponsor/Bidder Firm Name (Printed) Federal ID Number
City of Santa Cruz, a California municipal
corporation
94-6000427
By (Authorized Signature)
[counterpartySignerSignature_zvIHo4p]
Matt Huffaker, City Manager
Printed Name and Title of Person Signing
Date Executed
[counterpartySignerDateField_XRB
1r01]
Executed in the County of

SPONSOR CERTIFICATION CLAUSES
ARTICLE 1. STATEMENT OF COMPLIANCE
The Sponsor has, unless exempted, complied with the nondiscrimination program requirements. (Cal. Gov. Code, § 12990, subds. (a)-(f); Cal. Code Regs., tit. 2, § 11102) (Not applicable to public entities.)
ARTICLE 2. DRUG-FREE WORKPLACE REQUIREMENTS
The Sponsor will comply with the requirements of the Drug-Free Workplace Act of 1990 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

16.51 ATTACHMENT C THE SPONSOR PUBLIC WORKS CERTIFICATION C-2
prohibited and specifying actions to be taken against employees for violations.
b) Establish a Drug-Free Awareness Program to inform employees about:

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 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 the Sponsor may be ineligible for award of any future State agreements if the department determines that any of the following has occurred:
(1) the Sponsor has made false certification, or (2) violated the certification by failing to carry out the requirements as noted above. (Cal. Gov. Code, § 8350 et seq.) ARTICLE 3. NATIONAL LABOR RELATIONS BOARD CERTIFICATION The Sponsor certifies that no more than one (1) final unappealable finding of contempt of court by a Federal court has been issued against the Sponsor within the immediately preceding two-year period because of the Sponsor’s failure to comply with an order of a Federal court which orders the Sponsor to comply with an order of the National Labor Relations Board. (Cal. Pub.

Contract Code, § 10296) (Not applicable to public entities.) ARTICLE 4. INTENTIONALLY OMITTED.

ARTICLE 5. SWEATFREE CODE OF CONDUCT
a) All Sponsors contracting for the procurement or laundering of apparel, garments or corresponding accessories, or the procurement of equipment, materials, or supplies, other than procurement related to a public works Agreement, declare under penalty of perjury that no apparel, garments or corresponding accessories, equipment, materials, or supplies furnished to the state pursuant to the Agreement have been laundered or produced in

16.52 ATTACHMENT C THE SPONSOR PUBLIC WORKS CERTIFICATION C-3
whole or in part by sweatshop labor, forced labor, convict labor, indentured labor under penal sanction, abusive forms of child labor or exploitation of children in sweatshop labor, or with the benefit of sweatshop labor, forced labor, convict labor, indentured labor under penal sanction, abusive forms of child labor or exploitation of children in sweatshop labor. The Sponsor further declares under penalty of perjury that they adhere to the Sweatfree Code of Conduct as set forth on the California Department of Industrial Relations website located at www.dir.ca.gov and California Public Contract Code section 6108.
b) The Sponsor agrees to cooperate fully in providing reasonable access to the Sponsor’s records, documents, agents or employees, or premises if reasonably required by authorized officials of the contracting agency, the Department of Industrial Relations, or the Department of Justice to determine the Sponsor’s compliance with the requirements under paragraph (a).

ARTICLE 6. DOING BUSINESS WITH THE STATE OF CALIFORNIA
The following laws apply to persons or entities doing business with the State of California.

6.1 LABOR CODE/WORKERS’ COMPENSATION:

The Sponsor needs to be aware of the provisions which require every employer to be insured against liability for Workers’ Compensation or to undertake self-insurance in accordance with the provisions, and the Sponsor affirms to comply with such provisions before commencing the performance of the work of this Agreement. (Cal. Lab. Code, § 3700.) It is hereby mutually agreed that the Sponsor shall forfeit to the State a monetary penalty as determined in California Labor Code section 1775 for each calendar day, or portion thereof, for each worker paid by him or her, or subcontractor under him or her, less than the prevailing wage so stipulated and in addition the contractor further agrees to pay to each worker the difference between the actual amount paid for each calendar day, or portion thereof, and the stipulated prevailing wage rate for the same. This provision shall not apply to properly, registered apprentices.

It is further agreed that the maximum hours a worker is to be employed is limited to eight hours a day and forty (40) hours a week and the contractor shall forfeit, as a penalty to the State, twenty-five dollars ($25.00) for each worker employed in the execution of the contract for each calendar day during which a worker is required or permitted to labor more than eight hours in any calendar day or more than forty (40) hours in any calendar week, in violation of California Labor Code sections 1810-1815, inclusive.

Properly registered apprentices may be employed in the prosecution of the work. Every such apprentice shall be paid the standard wage paid to apprentices under the regulations of the craft or trade at which he or she is employed, and shall be employed only at the work of the craft or trade to which he or she is registered. The contractor and each subcontractor must comply with

16.53 ATTACHMENT C THE SPONSOR PUBLIC WORKS CERTIFICATION C-4
the requirements of California Labor Code section 1777.5 and any related regulations regarding the employment of registered apprentices.

Each contractor and subcontractor shall comply with California Labor Code section 1776 regarding record keeping.

6.2 AMERICANS WITH DISABILITIES ACT:

The Sponsor 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.)

6.3 THE SPONSOR’S NAME CHANGE:

An amendment is required to change the Sponsor’s name as listed on this Agreement. Upon receipt of legal documentation of the name change the State will process the amendment. Payment of invoices presented with a new name cannot be paid prior to approval of said amendment.

6.4 CORPORATE QUALIFICATION TO DO BUSINESS IN CALIFORNIA:
a) When agreements are to be performed in the state by corporations, the contracting agencies will be verifying that the Sponsor is currently qualified to do business in California in order to ensure that all obligations due to the state are fulfilled.
b) “Doing business” is defined in California Revenue and Taxation Code section 23101 as actively engaging in any transaction for the purpose of financial or pecuniary gain or profit. Although there are some statutory exceptions to taxation, rarely will a corporate Sponsor performing within the state not be subject to the franchise tax.
c) Both domestic and foreign corporations (those incorporated outside of California) must be in good standing in order to be qualified to do business in California. Agencies will determine whether a corporation is in good standing by calling the Office of the Secretary of State.

6.5 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.

6.6 AIR OR WATER POLLUTION VIOLATION:

Under the State laws, the Sponsor shall not be: (1) in violation of any order or resolution not subject to review promulgated by the State Air Resources Board or an air pollution control district; (2) subject to cease and desist order not subject to review issued pursuant to section 13301 of the California Water Code for violation of waste discharge requirements or discharge

16.54 ATTACHMENT C THE SPONSOR PUBLIC WORKS CERTIFICATION C-5
prohibitions; or (3) finally determined to be in violation of provisions of federal law relating to air or water pollution.

6.7 PAYEE DATA RECORD FORM STD. 204:

This form must be completed by all Sponsors that are not another state agency or other government entity.

6.8 CALIFORNIA CIVIL RIGHTS LAWS:

For Agreement executed or renewed after January 1, 2017, the Sponsor certifies compliance with the Unruh Civil Rights Act (section 51 of the California Civil Code) and the Fair Employment and Housing Act (section 12960 of the California Government Code).

6.9 EMPLOYER DISCRIMINATION POLICIES:

For Agreements executed or renewed after January 1, 2017, if the Sponsor has an internal policy against a sovereign nation or peoples recognized by the United States government, the Sponsor certifies that such policies are not used in violation of the Unruh Civil Rights Act (section 51 of the California Civil Code) and the Fair Employment and Housing Act (section 12960 of the California Government Code).

6.10 ANTITRUST CLAIMS:

The Sponsor offers and agrees and will require all of its contractors and subcontractors and suppliers to agree to assign to the awarding body all rights, title, and interest in and to all causes of action they may have under section 4 of the Clayton Act (Title 15, U.S.C. § 15) or under the Cartwright Act (Chapter 2 [commencing with section 16700] of Part 2 of Division 7 of the Business and Professions Code) arising from purchases of goods, services, or materials pursuant to the public works contract or subcontract. The assignment made by the contractor and all additional assignments made by the subcontractors and suppliers shall be deemed to have been made and will become effective at the time the awarding body tenders final payment to the contractor without further acknowledgment or the necessity of tendering to the awarding body any written assignments.

If an awarding body receives, either through judgment or settlement, a monetary recovery for a cause of action assigned under California Government Code sections 4550 to 4554, the assignor shall be entitled to receive reimbursement for actual legal costs incurred and may, on demand, recover from the public body any portion of the recovery, including treble damages, and attributable overcharges that were paid by the assignor but were not paid by the public body as a part of the bid price, less the expenses incurred in obtaining that portion of the recovery. On demand in writing by the assignor, the assignee shall, within one year from such demand, reassign the cause of action assigned under California Government Code sections 4550 to 4554 if the assignor has been or may have been injured by the violation of law for which the cause of action arose and (a) the assignee has not been injured thereby, or (b) the assignee declines to file a court action for the cause of action.

16.55 ATTACHMENT D STATEMENT OF WORK
D-1

ATTACHMENT D
STATEMENT OF WORK (“SOW”)
A: PROJECT AND SPONSOR INFORMATION
Sponsor Name: City of Santa Cruz, a California municipal corporation Entity type: City
Project UUID: BOND_1021_SantaCruzCoralS
Project Name: Santa Cruz Coral Street SUD Campus
Project Address: 125 Coral Street, Santa Cruz, CA 95060 B: PROGRAM FUNDS
Program Funds: $30,000,000.00
Acquisition with Grant Funds: No
C: PROJECT NARRATIVE (as described in the RFA)
The City of Santa Cruz is requesting $30 Million for its Coral Street SUD Campus, a new construction facility that will contain 50 beds of adult residential SUD treatment at ASAM levels 3.1, 3.2-WM, and 3.5. This project is in the design development phase, with expected completion by mid-2027. The project will attach to the Coral Street Campus, an existing facility that contains transitional housing, permanent supportive housing, and homeless services that include medical/dental clinic and workforce training. This colocation of different levels of care along the behavioral health continuum in one campus is a unique opportunity to provide a step up or down in treatment in a single location. The target population for the facility is the large unhoused population in the City, as well as individuals with SUD that are exiting the judicial system. According to recent Santa Cruz County research, 55% of the Santa Cruz County homeless population has a SUD diagnosis. In the most recent Point in Time (PIT) survey, 22% of respondents listed SUD as their primary condition that led to their homelessness. 46% of homeless respondents self-reported SUD, while 37% self-reported having a psychiatric or emotional condition. This facility will treat co-occurring SUD and mental illness, allowing the City to continue its progress in reducing the impact of homelessness on the downtown area.

D: PROJECT EXPANSION SCOPE REQUIREMENTS
Facility Type 1: Adult
Residential SUD
Treatment Facility
# New Beds: 50 # New Slots:

Facility Type 2: # New Beds: # New Slots:

Facility Type 3: # New Beds: # New Slots:

Facility Type 4: # New Beds: # New Slots:

16.56 ATTACHMENT D STATEMENT OF WORK
D-2
Facility Type 5: # New Beds: # New Slots:

Facility Type 6: # New Beds: # New Slots:

Facility Type 7: # New Beds: # New Slots:

Facility Type 8: # New Beds: # New Slots:

Facility Type 9: # New Beds: # New Slots:

Facility Type 10: # New Beds: # New Slots:

Total # New Beds: 50 Total # New Slots: 0
E: PROJECT MILESTONES AND DELIVERABLES
Milestone documentation and certifications must be submitted within sixty (60) days of meeting each milestone. Future Bond BHCIP Round 1: Launch Ready funding for this Project is dependent on successful completion of the minimum requirements and match minimum requirements at this Project Milestone and the terms and conditions of the Program Funding Agreement.

E.1 Minimum Requirements

1. Executed Program Funding Agreement

2. Board Authorizing Resolutions (BAR), if applicable

3. Completed Government Agency Taxpayer ID Form (W-9)

4. Opinion Letter by Legal Counsel

5. Certificates of Insurance: Commercial General Liability, Builders’ Risk, Workers’ Compensation, and Property

6. Current Title Report issued within the last thirty (30) days, if applicable

7. Recorded Declaration of Restrictions (DoR)

8. Certification #5 - Declaration of Restrictions

9. Execution of Facility Access Agreement (FAA) with State of California, Department of Health Care Services

10. Certification #1 - Budget Prevailing Wage Compliance

11. Certification #2 - Related Party and Related Party Transaction Disclosure

12. Certification #3 – Execution of Program Funding Agreement

13. Certification #6 - Legal Review of CA Welfare and Institution Code §5960.31

16.57 ATTACHMENT D STATEMENT OF WORK
D-3

14. Certification #19 – Execution of a Facility Access Agreement with State of California, Department of Health Care Services

15. Program Funding Projection Survey
E.2 Match Minimum Requirements

1. Documentation to satisfy that Sponsor has an In-Kind Match, if applicable:
a. Property Value Documentation (Tax Assessor’s Value or Certified Appraisal) b. Sunk Costs Value Documentation (paid receipts, invoices, payment validation)

2. Documentation to satisfy evidence of Cash Match Funds as approved by DHCS. Entire cash match must be expended prior to disbursement of the final up to twenty-five percent (25%) of Program Funds (“Withheld Funds”) to Sponsor.

3. Certification # 4 - Match Funds, Property Equity, or In-Kind Match E.3 Acquisition
In addition to the deliverables listed in Minimum Requirements, all projects acquired with Bond BHCIP funds will be required to submit:

1. Purchase and Sale Agreement (mutually executed by buyer and seller)

2. Certified Appraisal Report of Target Acquisition Property

3. Estimate of Escrow Closing Costs

4. Phase 1 Environmental Report

5. Phase 2 Environmental Report, if necessary

6. Asbestos Assessment and Lead-Based Paint Report

7. Certification #8 - Due Diligence Completed

8. Evidence of Any Additional Funds Necessary to Acquire Real Property, if necessary

9. Signed Escrow Instructions including Final Settlement Statement

10. Planning Agency Review Narrative

11. Certification #7 - Planning Agency Review
E.4 Pre-Construction (Planning and Permitting)

1. Phase 1 environmental report

2. Phase 2 environmental report, if necessary

3. Asbestos assessment and lead-based paint report (only required for rehabilitations)

4. Evidence of remediation or abatement, if necessary

5. Certification # 8 - Due Diligence Completed, if not previously provided

6. Planning Agency Review Narrative, if not previously provided

7. Certification # 7 - Planning Agency Review, if not previously provided

16.58 ATTACHMENT D STATEMENT OF WORK
D-4

8. Certification # 9 - Design Development Drawings Are 100% Complete

9. Certification # 10 – Construction Drawings for First Submittal To Building Department E.5 Start of Construction (Notice to Proceed and Executed Construction Contract)

1. Complete set of approved/stamped construction drawings

2. Executed construction contract with Construction Contract Addendum (Attachment I within PFA)

3. Certification # 11 – Construction Contract with Construction Contract Addendum

4. Confirmation the project has been registered with the California Department of Industrial Relations (DIR)

5. Evidence of Payment and Performance Bond by general contractor

6. Certification # 12 – Prevailing Wage Compliance

7. Copy of building permits

8. Approvals and Written Utility Service Commitments (will serve letters) from all Local Agencies, as required

9. Copy of Notice of Exemption filed for California Environmental Quality Act

10. Certification # 13 – Utility Service Commitments, Building Permit Receipt, and Notice Of Exemption Filed

11. Updated construction contract budget & schedule prior to issuance of Notice to Proceed

12. Evidence of Builder’s Risk (new construction and rehabilitation when there is a GC contract)

13. Evidence of Property Insurance (rehabilitation) – review to ensure coverage is “equal to the full replacement costs of all improvements” per the PFA

14. Evidence of Workers’ Compensation Insurance, Automobile Insurance, and General Liability Insurance

15. Copy of Notice to Proceed with issue date

16. Certification # 14 – Required Insurance and Notice to Proceed E.6 Project Construction 50% Complete

1. Certification #15 – Project Construction is 50% Complete

2. Updated construction budget and schedule from general contractor at expenditure of 50% of the costs of construction
E.7 Construction Complete, Licensing, and Operations

1. Temporary Certificate of Occupancy, if necessary

2. Certification #16 – Receipt of Certificate of Occupancy (CoO)

3. Certification #17 – Notice of Completion and Receipt of Conditional/Unconditional Final Release of Liens

4. Copy of Notice of Completion

16.59 ATTACHMENT D STATEMENT OF WORK
D-5

5. Certification #18 – Receipt of Business License and Operational

6. Certification #20 –Project Close-Out, Retention Funds, Excess Funds, And Continued Compliance
F. FUNDING REQUIREMENTS
Minimum Requirements for all requests:

1. Complete Draw Request for Program Funds inclusive of signed sponsor draw request form, invoice index, all proof of payment (including preliminary lien notices, conditional lien waivers, and lien release), if applicable

2. Site inspections reports, as necessary

3. Budget reallocation request, if applicable

4. Requirements associated with project milestone (Section E), dependent on project type

5. Updated Program Funding Projection Survey

6. DHCS Forms 1203 and 1204, as needed for purchases of Furniture, Fixtures, and Equipment (FF&E), if applicable

7. Regular progress reports to AHP but in all events at least once every thirty (30) days

8. Additional documentation as required at the sole discretion of AHP or DHCS.

Release of Retention Funds

9. Retention Funds, equal to ten percent (10%) of total Program Funds, are withheld as financial security until the contractor satisfactorily completes the construction work in accordance with contract requirements.

10. Retention Funds shall be released only upon the Sponsor’s submission of Certification No. 17, “Notice of Completion and Receipt of Conditional/Unconditional Final Releases of Liens,” in a form and substance acceptable to AHP or DHCS, and any additional supporting documentation, as may be required, subject to approval by AHP or DHCS.

16.60 ATTACHMENT D STATEMENT OF WORK
D-6
SCHEDULE 1
BOND BHCIP ROUND 1 FORM 2: LAUNCH READY BUDGET
Applicant Name City of Santa Cruz, a California municipal corporation Primary Applicant’s legal entity type City
BOND BHCIP ROUND 1 BUDGET: GRANT REQUEST

FEASIBILITY/DUE DILIGENCE
USE OF FUNDS To be funded by grant
Owner Administration (10% autofill) $10,130.00
Legal $10,000.00
Architect (schematic drawings/fit study) $54,000.00
Consultants (specify) $0.00
Engineering $0.00
Construction Manager/Owner's
Representative $25,000.00
Preliminary Title Report (submitted with
application) $0.00
Phase 1 Environmental Report $2,300.00
Phase 2 Environmental Report, if necessary $0.00
Site Surveys (soils and environmental) $10,000.00
Other Feasibility / Due Diligence Costs $0.00
Other Feasibility / Due Diligence
Costs $0.00
Contingency (10% autofill) $11,143.00
Total Feasibility Costs $122,573.00

DEVELOPMENT PLANNING
USE OF FUNDS To be funded by grant
Owner Administration (10% autofill) $226,075.00
Legal $10,000.00
Architecture (design drawings and
construction drawings) $1,432,000.00
Construction Manager/Owner's
Representative $50,000.00
Civil Engineer $97,750.00
Mechanical, Electrical, and Plumbing
(MEP) Engineer $160,000.00
Structural Engineer $193,000.00
Certified Appraisal Fee (for Property
Match) $6,000.00
Consultants (specify) $0.00
Consultants (specify) $273,000.00

16.61 ATTACHMENT D STATEMENT OF WORK
D-7
Consultants (specify) $39,000.00
Other Developmental Planning Costs
(specify) $0.00
Other Developmental Planning Costs
(specify) $0.00
Other Developmental Planning Costs
(specify) $0.00
ALTA Lender's Policy (estimate 0.01% of
total grant award) $0.00
Contingency (20% autofill) $497,365.00
Total Development Planning Costs $2,984,190.00

LAND COSTS/ACQUISITION
USE OF FUNDS To be funded by grant
Owner Administration (2% autofill) $0.00
Land Cost or Purchase Price $0.00
Closing Costs $0.00
Legal Fees $0.00
Broker's Fee $0.00
Appraisal Fee $0.00
Property Insurance at Closing $0.00
Construction Manager $0.00
Demolition Involved in Acquisition $0.00
Other Acquisition Costs (specify) $0.00
Contingency (5% autofill) $0.00
Total Land Costs $0.00
Off-Site Improvements (if needed) $0.00
Total Acquisition Costs $0.00

REHABILITATION OF EXISTING

FACILITY
USE OF FUNDS To be funded by grant
Owner Administration (5% autofill) $0.00
Legal $0.00
Construction Manager/Owner's
Representative $0.00
Physical Needs Assessment (PNA) $0.00
Asbestos and Lead Paint Survey (required
for all rehabs) $0.00
Site Work/Grading (materials and labor) $0.00
Hard Costs (materials and labor); labor must
include prevailing wages
$0.00
Furniture/Fixtures/Equipment (FFE; 10%
cap) $0.00
Demolition $0.00
Contractor Overhead $0.00

16.62 ATTACHMENT D STATEMENT OF WORK
D-8
Contractor Profit $0.00
Prevailing Wages Administration $0.00
Builder's Risk Insurance $0.00
General Liability Insurance $0.00
Project Inspection $0.00
Urban Greening $0.00
Other Rehabilitation (specify) $0.00
Other Rehabilitation (specify) $0.00
Other Rehabilitation (specify) $0.00
Owner's Contingency (20% autofill) $0.00
Total Rehabilitation Costs $0.00

GROUND-UP NEW CONSTRUCTION
USE OF FUNDS To be funded by grant
Owner Administration (5% autofill) $1,011,200.00
Legal $10,000.00
Construction Manager/Owner's
Representative $100,000.00
Site Work (materials and labor) $1,068,000.00
Hard Costs (materials and labor); labor must
include prevailing wages
$15,281,000.00
Furniture/Fixtures/Equipment (FFE; 10%
cap) $450,000.00
Demolition $174,000.00
General Conditions/Requirements $1,940,000.00
Contractor Profit $791,000.00
Prevailing Wages Administration $100,000.00
Builder's Risk Insurance $90,000.00
General Liability Insurance $200,000.00
Project Inspection $20,000.00
Urban Greening $0.00
Other New Construction (specify) $0.00
Other New Construction (specify) $0.00
Other New Construction (specify) $0.00
Other New Construction (specify) $0.00
Other New Construction (specify) $0.00
Owner's Contingency (20% autofill) $4,247,040.00
Total New Construction Costs $25,482,240.00

CONSTRUCTION PERMITS AND
FEES
USE OF FUNDS To be funded by grant
Owner Administration (10% autofill) $18,800.00
Payment and Performance Bonds by
General Contractor $118,000.00

16.63 ATTACHMENT D STATEMENT OF WORK
D-9
Building Permit Fees $50,000.00
Local Development Impact Fees $20,000.00
DIR Employment Reporting $0.00
Other Construction Permits and Fees
(specify) $0.00
Other Construction Permits and Fees
(specify) $0.00
Other Construction Permits and Fees
(specify) $0.00
Owner's Contingency (10% autofill) $20,680.00
Total Construction Permits and Fees $227,480.00

RESERVES
USE OF FUNDS To be funded by grant
Operating Reserves (rehabilitation) $0.00
Additional Cash Match (in excess of the
required match percentage) $0.00
Total Reserves Amount $0.00

OTHER PROJECT COSTS
USE OF FUNDS To be funded by grant
Post-Construction Commissioning $0.00
Accounting/Reimbursable $0.00
Other Costs (specify) $0.00
Other Costs (specify) $0.00
Other Costs (specify) $0.00
Other Costs (specify) $0.00
Owner's Contingency (10% autofill) $0.00
Total Other Project Costs $0.00

DEVELOPER COSTS
USE OF FUNDS To be funded by grant
Developer Overhead $1,090,517.00
Consultants/Processing Agents $93,000.00
Project Administration $0.00
Other Developer Costs (specify) $0.00
Total Developer Costs $1,183,517.00
TOTAL BOND BHCIP ROUND 1
FUNDING: $30,000,000.00

16.64 ATTACHMENT E PAYMENT SCHEDULE
E-1

ATTACHMENT E

PAYMENT SCHEDULE
Payment Schedule
Payment schedule: The Sponsor shall submit a complete request for Program Funds monthly no later than the 15th of each month to AHP and DHCS in a form acceptable to AHP and DHCS, for a specific amount of funds confirmed by specific invoices and supporting documents for actual work completed.

The Sponsor shall submit a draw request for any expenditure no later than forty-five (45) days from the date the Sponsor incurs the expense. AHP shall disburse Program Funds to the Sponsor’s account upon written approval of the Sponsor’s complete draw request, contingent upon the availability of Bond BHCIP Funds.

16.65 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-1

ATTACHMENT F

THE SPONSOR COMPLIANCE CERTIFICATIONS
CERTIFICATION NO. 1 BUDGET PREVAILING WAGE COMPLIANCE
CERTIFICATION NO. 2 RELATED PARTY & RELATED PARTY TRANSACTION

DISCLOSURE
CERTIFICATION NO. 3 EXECUTION OF PROGRAM FUNDING AGREEMENT CERTIFICATION NO. 4 MATCH FUNDS, PROPERTY EQUITY, OR IN-KIND MATCH
CERTIFICATION NO. 5 DECLARATION OF RESTRICTIONS
CERTIFICATION NO. 6 LEGAL REVIEW OF CA WELFARE AND INSTITUTIONS CODE §5960.31
CERTIFICATION NO. 7 PLANNING AGENCY REVIEW
CERTIFICATION NO. 8 DUE DILIGENCE COMPLETED
CERTIFICATION NO. 9 DESIGN DEVELOPMENT DRAWINGS 100% COMPLETE CERTIFICATION NO. 10 CONSTRUCTION DRAWINGS FOR FIRST SUBMITTAL

TO BUILDING DEPARTMENT
CERTIFICATION NO. 11 CONSTRUCTION CONTRACT WITH CONSTRUCTION

CONTRACT ADDENDUM
CERTIFICATION NO. 12 PREVAILING WAGE COMPLIANCE
CERTIFICATION NO. 13 UTILITY SERVICE COMMITMENTS, BUILDING

PERMIT RECEIPT AND NOTICE OF EXEMPTION FILED
CERTIFICATION NO. 14 REQUIRED INSURANCE AND NOTICE TO PROCEED CERTIFICATION NO. 15 PROJECT CONSTRUCTION IS 50% COMPLETE CERTIFICATION NO. 16 RECEIPT OF CERTIFICATE OF OCCUPANCY CERTIFICATION NO. 17 NOTICE OF COMPLETION AND RECEIPT OF

CONDITIONAL/UNCONDITIONAL FINAL RELEASES OF
LIENS
CERTIFICATION NO. 18 RECEIPT OF BUSINESS LICENSE AND OPERATIONAL CERTIFICATION NO. 19 EXECUTION OF A FACILITY ACCESS AGREEMENT

WITH STATE OF CALIFORNIA, DEPARTMENT OF

HEALTH CARE SERVICES
CERTIFICATION NO. 20 PROJECT CLOSE-OUT, RETENTION FUNDS, EXCESS

FUNDS, AND CONTINUED COMPLIANCE

16.66 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-2
SPONSOR’S CERTIFICATION NO. 1

BUDGET PREVAILING WAGE COMPLIANCE
I, Matt Huffaker, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (the “State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. As part of the application, the Sponsor has submitted a construction budget for the Project. The construction budget was prepared with the assistance and/or consultation of a licensed contractor, architect, or experienced construction manager; the licensed contractor, architect, or construction manager was informed that the Project is a Public Works project as that term is defined in the California Labor Code section 1720 et. seq.; and was prepared using the applicable prevailing wages for all construction work to be performed as part of the Project in accordance with California Labor Code section 1720 et seq.

4. The Sponsor further certifies that the Sponsor (i) has been provided with copies of California Labor Code sections 1771, 1775, 1776, 1777.5, 1813 and 1815, attached hereto as Schedule 1; (ii) has included, or shall include, those California Labor Code provisions in the construction contract with the licensed contractor; and (iii) has notified, or shall notify, the licensed contractor that such California Labor Code provisions must be included in any subcontracts.

5. The Sponsor acknowledges and agrees to periodically review the licensed contractors’ payroll records to monitor compliance with California prevailing wage requirements and to take diligent action if the Sponsor discovers any failure by the licensed contractor or any of its subcontractors to pay prevailing wages or to otherwise comply with the requirements of the California Labor Code.

6. The Sponsor agrees, in accordance with California Labor Code section 1773.3, to provide notice to the California Department of Industrial Relations (“DIR”) of the construction contract within thirty (30) days of the award of such construction contract.

7. The Sponsor shall require the licensed contractor to keep accurate payroll records in compliance with California Labor Code section 1776 and shall require the licensed contractor to make such records available to the DIR in accordance with California Labor Code section 1771.4(a)(3).

8. The Sponsor shall comply with, and shall require its licensed contractor to comply with, any and all other requirements of the California Labor Code related to prevailing wages, all California wage and hours laws, and any applicable federal labor and wage and hour requirements for the duration of the Project.

16.67 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-3
I certify under penalty of perjury that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 1, Budget Prevailing Wage Compliance, as a condition of receiving the Program Funds. [counterpartySignerSignature_VuPHfd3]
Authorized Signature
Matt Huffaker
Typed Name of Signatory
City Manager
Title of Signatory
[counterpartySignerDateField_YghUlfe]
Date

16.68 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-4
Schedule 1
Copies of California Labor Code Sections 1771, 1775, 1776, 1777.5, 1813, and 1815 Attached

STATE PREVAILING WAGES STATUTES
The provisions of California Labor Code sections 1771, 1775, 1776, 1777.5, 1813, and 1815, as set out below and as may be amended, must be incorporated into all construction contracts. All references to sections are to sections of the California Labor Code. (i) Section 1771:
“Except for public works projects of one thousand dollars ($1,000) or less, not less than the general prevailing rate of per diem wages for work of a similar character in the locality in which the public work is performed, and not less than the general prevailing rate of per diem wages for holiday and overtime work fixed as provided in this chapter, shall be paid to all workers employed on public works.

This section is applicable only to work performed under contract, and is not applicable to work carried out by a public agency with its own forces. This section is applicable to contracts let for maintenance work.”
(ii) Section 1775:
“(a) (1) The contractor and any subcontractor under the contractor shall, as a penalty to the state or political subdivision on whose behalf the contract is made or awarded, forfeit not more than two hundred dollars ($200) for each calendar day, or portion thereof, for each worker paid less than the prevailing wage rates as determined by the director for the work or craft in which the worker is employed for any public work done under the contract by the contractor or, except as provided in subdivision (b), by any subcontractor under the contractor.
(2) (A) The amount of the penalty shall be determined by the Labor Commissioner based on consideration of both of the following:
(i) Whether the failure of the contractor or subcontractor to pay the correct rate of per diem wages was a good faith mistake and, if so, the error was promptly and voluntarily corrected when brought to the attention of the contractor or subcontractor. (ii) Whether the contractor or subcontractor has a prior record of failing to meet its prevailing wage obligations.
(B) (i) The penalty may not be less than forty dollars ($40) for each calendar day, or portion thereof, for each worker paid less than the prevailing wage rate, unless the failure of the contractor or subcontractor to pay the correct rate of per diem wages was a good faith mistake and, if so, the error was promptly and voluntarily corrected when brought to the attention of the contractor or subcontractor.

16.69 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-5
(ii) The penalty may not be less than eighty dollars ($80) for each calendar day, or portion thereof, for each worker paid less than the prevailing wage rate, if the contractor or subcontractor has been assessed penalties within the previous three years for failing to meet its prevailing wage obligations on a separate contract, unless those penalties were subsequently withdrawn or overturned.
(iii) The penalty may not be less than one hundred twenty dollars ($120) for each calendar day, or portion thereof, for each worker paid less than the prevailing wage rate, if the Labor Commissioner determines that the violation was willful, as defined in subdivision (c) of Section 1777.1.
(C) If the amount due under this section is collected from the contractor or subcontractor, any outstanding wage claim under Chapter 1 (commencing with Section 1720) of Part 7 of Division 2 against that contractor or subcontractor shall be satisfied before applying that amount to the penalty imposed on that contractor or subcontractor pursuant to this section. (D) The determination of the Labor Commissioner as to the amount of the penalty shall be reviewable only for abuse of discretion.
(E) The difference between the prevailing wage rates and the amount paid to each worker for each calendar day or portion thereof for which each worker was paid less than the prevailing wage rate shall be paid to each worker by the contractor or subcontractor, and the body awarding the contract shall cause to be inserted in the contract a stipulation that this section will be complied with.
(b) If a worker employed by a subcontractor on a public works project is not paid the general prevailing rate of per diem wages by the subcontractor, the prime contractor of the project is not liable for any penalties under subdivision (a) unless the prime contractor had knowledge of that failure of the subcontractor to pay the specified prevailing rate of wages to those workers or unless the prime contractor fails to comply with all of the following requirements:
(1) The contract executed between the contractor and the subcontractor for the performance of work on the public works project shall include a copy of the provisions of this section and Sections 1771, 1776, 1777.5, 1813, and 1815.
(2) The contractor shall monitor the payment of the specified general prevailing rate of per diem wages by the subcontractor to the employees, by periodic review of the certified payroll records of the subcontractor.
(3) Upon becoming aware of the failure of the subcontractor to pay his or her workers the specified prevailing rate of wages, the contractor shall diligently take corrective action to halt or rectify the failure, including, but not limited to, retaining sufficient funds due the subcontractor for work performed on the public works project. (4) Prior to making final payment to the subcontractor for work performed on the public works project, the contractor shall obtain an affidavit signed under penalty of perjury from the subcontractor that the subcontractor has paid the specified general prevailing rate of

16.70 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-6
per diem wages to his or her employees on the public works project and any amounts due pursuant to Section 1813.
(c) The Division of Labor Standards Enforcement shall notify the contractor on a public works project within 15 days of the receipt by the Division of Labor Standards Enforcement of a complaint of the failure of a subcontractor on that public works project to pay workers the general prevailing rate of per diem wages.” (iii) Section 1776:
“(a) Each contractor and subcontractor shall keep accurate payroll records, showing the name, address, social security number, work classification, straight time and overtime hours worked each day and week, and the actual per diem wages paid to each journeyman, apprentice, worker, or other employee employed by the contractor of subcontractor in connection with the public work. Each payroll record shall contain or be verified by a written declaration that it is made under penalty of perjury, stating both of the following:
(1) The information contained in the payroll record is true and correct. (2) The employer has complied with the requirements of Sections 1771, 1811, and 1815 for any work performed by that person on the public works project. (b) The payroll records enumerated under subdivision (a) shall be certified and shall be available for inspection at all reasonable hours at the principal office of the contractor on the following basis:
(1) A certified copy of an employee’s payroll record shall be made available for inspection or furnished to the employee or the employee’s authorized representative on request. (2) A certified copy of all payroll records enumerated in subdivision (a) shall be made available for inspection or furnished upon request to a representative of the body awarding the contract and the Division of Labor Standards Enforcement of the Department of Industrial Relations.
(3) A certified copy of all payroll records enumerated in subdivision (a) shall be made available upon request by the public for inspection or for copies thereof. However, a request by the public shall be made through either the body awarding the contract or the Division of Labor Standards Enforcement. If the requested payroll records have not been provided pursuant to paragraph (2), the requesting party shall, prior to being provided the records, reimburse the costs of preparation by the contractor, subcontractors, and the entity through which the request was made. The public may not be given access to the records at the principal office of the contractor.
(c) Unless required to be furnished directly to the Labor Commissioner in accordance with paragraph (3) of subdivision (a) of Section 1771.4, the certified payroll records shall be on forms provided by the Division of Labor Standards Enforcement or shall contain the same information as the forms provided by the division. The payroll records may consist of printouts of payroll data that are maintained as computer records, if the printouts contain

16.71 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-7
the same information as the forms provided by the division and the printouts are verified in the manner specified in subdivision (a).
(d) A contractor or subcontractor shall file a certified copy of the records enumerated in subdivision (a) with the entity that requested the records within 10 days after receipt of a written request.
(e) Except as provided in subdivision (f), any copy of records made available for inspection as copies and furnished upon request to the public or any public agency by the awarding body or the Division of Labor Standards Enforcement shall be marked or obliterated to prevent disclosure of an individual’s name, address, and social security number. The name and address of the contractor awarded the contract or the subcontractor performing the contract shall not be marked or obliterated. Any copy of records made available for inspection by, or furnished to, a multiemployer Taft-Hartley trust fund (29 U.S.C. Sec. 186(c)(5)) that requests the records for the purposes of allocating contributions to participants shall be marked or obliterated only to prevent disclosure of an individual’s full social security number, but shall provide the last four digits of the social security number.

Any copy of records made available for inspection by, or furnished to, a joint labormanagement committee established pursuant to the federal Labor Management Cooperation Act of 1978 (29 U.S.C. Sec. 175a) shall be marked or obliterated only to prevent disclosure of an individual’s social security number. (f) (1) Notwithstanding any other provision of law, agencies that are included in the Joint Enforcement Strike Force on the Underground Economy established pursuant to Section 329 of the Unemployment Insurance Code and other law enforcement agencies investigating violations of law shall, upon request, be provided nonredacted copies of certified payroll records. Any copies of records or certified payroll made available for inspection and furnished upon request to the public by an agency included in the Joint Enforcement Strike Force on the Underground Economy or to a law enforcement agency investigating a violation of law shall be marked or redacted to prevent disclosure of an individual’s name, address, and social security number. (2) An employer shall not be liable for damages in a civil action for any reasonable act or omission taken in good faith in compliance with this subdivision. (g) The contractor shall inform the body awarding the contract of the location of the records enumerated under subdivision (a), including the street address, city, and county, and shall, within five working days, provide a notice of a change of location and address. (h) The contractor or subcontractor has 10 days in which to comply subsequent to receipt of a written notice requesting the records enumerated in subdivision (a). In the event that the contractor or subcontractor fails to comply within the 10-day period, the contractor or subcontractor shall, as a penalty to the state or political subdivision on whose behalf the contract is made or awarded, forfeit one hundred dollars ($100) for each calendar day, or portion thereof, for each worker, until strict compliance is effectuated. Upon the request of the Division of Labor Standards Enforcement, these penalties shall be withheld from progress payments then due. A contractor is not subject to a penalty assessment pursuant to this section due to the failure of a subcontractor to comply with this section.

16.72 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-8
(i) The body awarding the contract shall cause to be inserted in the contract stipulations to effectuate this section.
(j) The director shall adopt rules consistent with the California Public Records Act (Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code) and the Information Practices Act of 1977 (Title 1.8 (commencing with Section 1798) of Part 4 of Division 3 of the Civil Code) governing the release of these records, including the establishment of reasonable fees to be charged for reproducing copies of records required by this section.”
(iv) Section 1777.5:
“(a) (1) This chapter does not prevent the employment upon public works of properly registered apprentices who are active participants in an approved apprenticeship program. (2) For purposes of this chapter, “apprenticeship program” means a program under the jurisdiction of the California Apprenticeship Council established pursuant to Section 3070. (b) (1) Every apprentice employed upon public works shall be paid the prevailing rate of per diem wages for apprentices in the trade to which he or she is registered and shall be employed only at the work of the craft or trade to which he or she is registered. (2) Unless otherwise provided by a collective bargaining agreement, when a contractor requests the dispatch of an apprentice pursuant to this section to perform work on a public works project and requires the apprentice to fill out an application or undergo testing, training, an examination, or other preemployment process as a condition of employment, the apprentice shall be paid for the time spent on the required preemployment activity, including travel time to and from the required activity, if any, at the prevailing rate of per diem wages for apprentices in the trade to which he or she is registered. Unless otherwise provided by a collective bargaining agreement, a contractor is not required to compensate an apprentice for the time spent on preemployment activities if the apprentice is required to take a preemployment drug or alcohol test and he or she fails to pass that test. (c) Only apprentices, as defined in Section 3077, who are in training under apprenticeship standards that have been approved by the Chief of the Division of Apprenticeship Standards and who are parties to written apprentice agreements under Chapter 4 (commencing with Section 3070) of Division 3 are eligible to be employed at the apprentice wage rate on public works. The employment and training of each apprentice shall be in accordance with either of the following:
(1) The apprenticeship standards and apprentice agreements under which he or she is training.
(2) The rules and regulations of the California Apprenticeship Council. (d) If the contractor to whom the contract is awarded by the state or any political subdivision, in performing any of the work under the contract, employs workers in any apprenticeable craft or trade, the contractor shall employ apprentices in at least the ratio set forth in this section and may apply to any apprenticeship program in the craft or trade that

16.73 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-9
can provide apprentices to the site of the public work for a certificate approving the contractor under the apprenticeship standards for the employment and training of apprentices in the area or industry affected. However, the decision of the apprenticeship program to approve or deny a certificate shall be subject to review by the Administrator of Apprenticeship. The apprenticeship program or programs, upon approving the contractor, shall arrange for the dispatch of apprentices to the contractor. A contractor covered by an apprenticeship program’s standards shall not be required to submit any additional application in order to include additional public works contracts under that program. “Apprenticeable craft or trade,” as used in this section, means a craft or trade determined as an apprenticeable occupation in accordance with rules and regulations prescribed by the California Apprenticeship Council. As used in this section, “contractor” includes any subcontractor under a contractor who performs any public works not excluded by subdivision (o).
(e) Before commencing work on a contract for public works, every contractor shall submit contract award information to an applicable apprenticeship program that can supply apprentices to the site of the public work. The information submitted shall include an estimate of journeyman hours to be performed under the contract, the number of apprentices proposed to be employed, and the approximate dates the apprentices would be employed. A copy of this information shall also be submitted to the awarding body, if requested by the awarding body. Within 60 days after concluding work on the contract, each contractor and subcontractor shall submit to the awarding body, if requested, and to the apprenticeship program a verified statement of the journeyman and apprentice hours performed on the contract. The information under this subdivision shall be public. The apprenticeship programs shall retain this information for 12 months. (f) The apprenticeship program supplying apprentices to the area of the site of the public work shall ensure equal employment and affirmative action in apprenticeship for women and minorities.
(g) The ratio of work performed by apprentices to journeymen employed in a particular craft or trade on the public work may be no higher than the ratio stipulated in the apprenticeship standards under which the apprenticeship program operates if the contractor agrees to be bound by those standards. However, except as otherwise provided in this section, in no case shall the ratio be less than one hour of apprentice work for every five hours of journeyman work.
(h) This ratio of apprentice work to journeyman work shall apply during any day or portion of a day when any journeyman is employed at the jobsite and shall be computed on the basis of the hours worked during the day by journeymen so employed. Any work performed by a journeyman in excess of eight hours per day or 40 hours per week shall not be used to calculate the ratio. The contractor shall employ apprentices for the number of hours computed as above before the end of the contract or, in the case of a subcontractor, before the end of the subcontract. However, the contractor shall endeavor, to the greatest extent possible, to employ apprentices during the same time period that the journeymen in the same craft or trade are employed at the jobsite. When an hourly apprenticeship ratio is not feasible for a particular craft or trade, the Administrator of Apprenticeship, upon

16.74 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-10
application of an apprenticeship program, may order a minimum ratio of not less than one apprentice for each five journeymen in a craft or trade classification. (i) A contractor covered by this section who has agreed to be covered by an apprenticeship program’s standards upon the issuance of the approval certificate, or who has been previously approved for an apprenticeship program in the craft or trade, shall employ the number of apprentices or the ratio of apprentices to journeymen stipulated in the applicable apprenticeship standards, but in no event less than the 1-to-5 ratio required by subdivision (g).
(j) Upon proper showing by a contractor that he or she employs apprentices in a particular craft or trade in the state on all of his or her contracts on an annual average of not less than one hour of apprentice work for every five hours of labor performed by journeymen, the Administrator of Apprenticeship may grant a certificate exempting the contractor from the 1-to-5 hourly ratio, as set forth in this section for that craft or trade. (k) An apprenticeship program has the discretion to grant to a participating contractor or contractor association a certificate, which shall be subject to the approval of the Administrator of Apprenticeship, exempting the contractor from the 1-to-5 ratio set forth in this section when it finds that any one of the following conditions is met:
(1) Unemployment for the previous three-month period in the area exceeds an average of 15 percent.
(2) The number of apprentices in training in the area exceeds a ratio of 1 to 5. (3) There is a showing that the apprenticeable craft or trade is replacing at least one-thirtieth of its journeymen annually through apprenticeship training, either on a statewide basis or on a local basis.
(4) Assignment of an apprentice to any work performed under a public works contract would create a condition that would jeopardize his or her life or the life, safety, or property of fellow employees or the public at large, or the specific task to which the apprentice is to be assigned is of a nature that training cannot be provided by a journeyman. (l) If an exemption is granted pursuant to subdivision (k) to an organization that represents contractors in a specific trade from the 1-to-5 ratio on a local or statewide basis, the member contractors shall not be required to submit individual applications for approval to local joint apprenticeship committees, if they are already covered by the local apprenticeship standards.
(m) (1) A contractor to whom a contract is awarded, who, in performing any of the work under the contract, employs journeymen or apprentices in any apprenticeable craft or trade shall contribute to the California Apprenticeship Council the same amount that the director determines is the prevailing amount of apprenticeship training contributions in the area of the public works site. A contractor may take as a credit for payments to the council any amounts paid by the contractor to an approved apprenticeship program that can supply apprentices to the site of the public works project. The contractor may add the amount of the contributions in computing his or her bid for the contract.

16.75 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-11
(2) (A) At the conclusion of the 2002–03 fiscal year and each fiscal year thereafter, the California Apprenticeship Council shall distribute training contributions received by the council under this subdivision, less the expenses of the Department of Industrial Relations for administering this subdivision, by making grants to approved apprenticeship programs for the purpose of training apprentices. The grant funds shall be distributed as follows:
(i) If there is an approved multiemployer apprenticeship program serving the same craft or trade and geographic area for which the training contributions were made to the council, a grant to that program shall be made.
(ii) If there are two or more approved multiemployer apprenticeship programs serving the same craft or trade and county for which the training contributions were made to the council, the grant shall be divided among those programs based on the number of apprentices from that county registered in each program. (iii) All training contributions not distributed under clauses (i) and (ii) shall be used to defray the future expenses of the Department of Industrial Relations for the administration and enforcement of apprenticeship and preapprenticeship standards and requirements under this code.
(B) An apprenticeship program shall only be eligible to receive grant funds pursuant to this subdivision if the apprenticeship program agrees, prior to the receipt of any grant funds, to keep adequate records that document the expenditure of grant funds and to make all records available to the Department of Industrial Relations so that the Department of Industrial Relations is able to verify that grant funds were used solely for training apprentices. For purposes of this subparagraph, adequate records include, but are not limited to, invoices, receipts, and canceled checks that account for the expenditure of grant funds. This subparagraph shall not be deemed to require an apprenticeship program to provide the Department of Industrial Relations with more documentation than is necessary to verify the appropriate expenditure of grant funds made pursuant to this subdivision. (C) The Department of Industrial Relations shall verify that grants made pursuant to this subdivision are used solely to fund training apprentices. If an apprenticeship program is unable to demonstrate how grant funds are expended or if an apprenticeship program is found to be using grant funds for purposes other than training apprentices, then the apprenticeship program shall not be eligible to receive any future grant pursuant to this subdivision and the Department of Industrial Relations may initiate the process to rescind the registration of the apprenticeship program.
(3) All training contributions received pursuant to this subdivision shall be deposited in the Apprenticeship Training Contribution Fund, which is hereby created in the State Treasury.

Upon appropriation by the Legislature, all moneys in the Apprenticeship Training Contribution Fund shall be used for the purpose of carrying out this subdivision and to pay the expenses of the Department of Industrial Relations. (n) The body awarding the contract shall cause to be inserted in the contract stipulations to effectuate this section. The stipulations shall fix the responsibility of compliance with this section for all apprenticeable occupations with the prime contractor.

16.76 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-12
(o) This section does not apply to contracts of general contractors or to contracts of specialty contractors not bidding for work through a general or prime contractor when the contracts of general contractors or those specialty contractors involve less than thirty thousand dollars ($30,000).
(p) An awarding body that implements an approved labor compliance program in accordance with subdivision (b) of Section 1771.5 may, with the approval of the director, assist in the enforcement of this section under the terms and conditions prescribed by the director.”
(v) Section 1813:
“The contractor or subcontractor shall, as a penalty to the state or political subdivision on whose behalf the contract is made or awarded, forfeit twenty-five dollars ($25) for each worker employed in the execution of the contract by the respective contractor or subcontractor for each calendar day during which the worker is required or permitted to work more than 8 hours in any one calendar day and 40 hours in any one calendar week in violation of the provisions of this article. In awarding any contract for public work, the awarding body shall cause to be inserted in the contract a stipulation to this effect. The awarding body shall take cognizance of all violations of this article committed in the course of the execution of the contract, and shall report them to the Division of Labor Standards Enforcement.”
(vi) Section 1815:
“Notwithstanding the provisions of Sections 1810 to 1814, inclusive, of this code, and notwithstanding any stipulation inserted in any contract pursuant to the requirements of said sections, work performed by employees of contractors in excess of 8 hours per day, and 40 hours during any one week, shall be permitted upon public work upon compensation for all hours worked in excess of 8 hours per day at not less than 1 ½ times the basic rate of pay.”

16.77 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-13
SPONSOR’S CERTIFICATION NO. 2

RELATED PARTY & RELATED PARTY TRANSACTION DISCLOSURE
I, Matt Huffaker, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that it has disclosed to AHP and/or the State the composition of the Sponsor including any entity, member, manager, partner, or person that directly or indirectly owns or controls, is owned or controlled by, or is under common ownership or common control with the Sponsor (“Related Party” or “Related Parties”).

4. The Sponsor certifies that it shall disclose to AHP and/or the State, promptly, any change in ownership or control of the Sponsor or any merger or acquisition that changes the control of the Sponsor. For purposes of this Agreement, “ownership” shall mean any entity, member, manager, partner, or person that has an ownership interest of greater than ten percent (10%) in the Sponsor, and “control” shall mean possession of the authority to direct or cause the direction of the affairs or management of the Sponsor.

5. The Sponsor certifies that it shall disclose to AHP and/or the State, promptly, upon the existence or discovery of an actual or potential transaction, agreement, or settlement with a Related Party in connection with the Project (“Related Party Transaction”).

6. The Sponsor certifies that it shall disclose to AHP and/or the State: (1) the nature of the relationship, (2) the nature of the potential or actual transaction, agreement, or settlement, (3) the dollar amounts of any such transaction, agreement, or settlement, (4) the dollar amounts due to or from any Related Party, and (5) documents and any additional information, as may be required by AHP and/or the State in their sole discretion.

SIGNATURE ON THE FOLLOWING PAGE

16.78 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-14
I certify that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 2, Related Party & Related Party Transaction Disclosure, as a condition of receiving the Program Funds. [counterpartySignerSignature_we0bWR7]
Authorized Signature
Matt Huffaker
Typed Name of Signatory
City Manager
Title of Signatory
[counterpartySignerDateField_3FoIpso]
Date

16.79 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-15
SPONSOR’S CERTIFICATION NO. 3

EXECUTION OF PROGRAM FUNDING AGREEMENT
I, Matt Huffaker, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (the “State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that it has executed a contract with AHP entitled “Program Funding Agreement” and that it has provided a true and correct copy of such executed AHP-Sponsor Program Funding Agreement, including all attachments, to AHP.

I certify that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 3, Execution of Program Funding Agreement, as a condition of receiving the Program Funds. [counterpartySignerSignature_sPhupvj]
Authorized Signature
Matt Huffaker
Typed Name of Signatory
City Manager
Title of Signatory
[counterpartySignerDateField_Qzc5c2i]
Date

16.80 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-16
SPONSOR’S CERTIFICATION NO. 4

MATCH FUNDS, PROPERTY EQUITY, OR IN-KIND MATCH
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing the Program Funds.

3. The Sponsor certifies that, if, and as required by the terms of the Program, the Sponsor is required to provide a match for the Program Funds, and the Sponsor’s match is in the form of cash, the Sponsor has provided to AHP, as required by the terms of the Program Funding Agreement, evidence in the form of account statements or other auditable financial record to the amount of ______________________________ (____________) (“Match Funds”).

4. The Sponsor certifies that, if, and as required by the terms of the Program, the Sponsor is required to provide a match for the Program Funds, and the Sponsor’s match is in the form of equity in real property upon which the Project is to be constructed, located at 125 Coral Street, Santa Cruz, CA 95060 (the “Project Property”), the Sponsor has provided to AHP (i) the assessed value of the Project Property on the property tax assessment rolls or a written appraisal report setting forth an opinion of fair market value prepared by a certified general appraiser licensed in the State of California, and (ii) all current loan statements reflecting any outstanding loan balances secured by the Project Property, or a statement of outstanding bond debt.

5. The Sponsor certifies that, if, and as required by the terms of the Program, the Sponsor is required to provide an in-kind match for the Program Funds, and the Sponsor’s match is in the form of the amount of any reasonable, actual, and documented, as determined by DHCS in their sole discretion, Project specific fees and expenses incurred by the Sponsor directly for the improvement of the Project Property no more than one (1) year prior to May 6, 2025, the date of the Notice of Conditional Award (“Sunk Costs”), such expenditures incurred were in the amount of not less than ______________________ (___________), as evidenced by Project specific documents, including, but not limited to, invoices with attached proof of payment for work completed, materials purchased, professional, design-build, or other services rendered and paid for by the Sponsor in connection with the Project.

6. The Sponsor further certifies that its match for the Program Funds, as required by the terms of the Program, is in the form of ______________________________________ described as follows:
______________________________________________________________________________

16.81 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-17
______________________________________________________________________________ ___________________________________________________________________________.

7. At AHP’s request, the Sponsor agrees to submit to AHP, promptly, documentation that verifies the Sponsor’s statements contained in Sections 3, 4, 5, or 6 of this Certification prior to disbursement of any Program Funds, including, but not limited to, bank account statements or other auditable financial record and title documents.

I certify under penalty of perjury that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 4, Match Funds, Property Equity, or In-Kind Match, as a condition of receiving the Program Funds. ____________________________
Authorized Signature
____________________________
Typed Name of Signatory
____________________________
Title of Signatory
____________________________
Date

16.82 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-18
SPONSOR’S CERTIFICATION NO. 5

DECLARATION OF RESTRICTIONS
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that the Project is subject to a Regulatory Agreement and Declaration of Restrictions, substantially in the form attached to the Program Funding Agreement as Attachment H (the “Declaration of Restrictions”), which has been recorded in the official records in the county in which the Project is located, and which, in addition to other matters, restricts the use of the Project. The Sponsor further certifies that it shall provide to AHP, concurrently with this Certification, a copy of such recorded Declaration of Restrictions, which shall evidence recordation in the official records in the county in which the Project is located.

I certify under penalty of perjury that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 5, Declaration of Restrictions, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.83 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-19
SPONSOR’S CERTIFICATION NO. 6
LEGAL REVIEW OF CA WELFARE AND INSTITUTIONS CODE §5960.31 I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that it has had the opportunity to seek advice from legal counsel as to its rights and responsibilities regarding California Welfare and Institutions Code section 5960.31, set forth below:
(a) Notwithstanding any other law, projects funded pursuant to paragraph (3) or (4) of subdivision (b) of Section 5965.04 shall be a use by right and shall be subject to the streamlined, ministerial review process and filing requirement, pursuant to subdivisions (b) and (d) of Section 50675.1.5 of the Health and Safety Code, and not subject to a conditional use permit, discretionary permit, or to any other discretionary reviews or approvals, if it meets the criteria of paragraph (1) or (2) and complies with subdivisions (b) and (c). (1) The project is a behavioral health treatment and residential setting, including, but not limited to, children’s residential crisis programs, peer respite, children’s and adult substance use disorder residential programs, recovery housing, short-term residential therapeutic program, and social rehabilitation program, and shall be located in a zone where residential, office, retail, or parking are a principally permitted use. (2) (A) The project is a real estate asset, as described in Section 5960.05, except for those described in paragraph (1), or in subparagraph (A) of paragraph (1) of subdivision (a) of Section 5831, that is funded pursuant to Section 5967.01, and shall be located in a zone where office, retail, or parking are a principally permitted use.
(B) This paragraph shall not be construed to limit the discretion of local jurisdictions to permit real estate assets in a zone not expressly provided in this paragraph.

16.84 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-20
(b) Projects, as applicable, pursuant to this section shall comply with the core components of Housing First, as defined under subdivision (b) of Section 8255, and may include recovery housing, as defined by the United States Department of Housing and Urban Development.
(c) Projects pursuant to this section shall meet the labor standards contained in Sections 65912.130 and 65912.131 of the Government Code. (d) For purposes of this section, “use by right” means a development project that satisfies both of the following conditions:
(1) The development project does not require a conditional use permit, planned unit development permit, or other discretionary local government review.
(2) The development project is not a “project” for purposes of Division 13 (commencing with Section 21000) of the Public Resources Code.

I certify under penalty of perjury that the above information is true and correct and that the Sponsor has read and understands the terms of this certification and shall comply with all requirements set forth above, in Sponsor’s Certification No. 6, Legal Review of CA Welfare and Institutions Code §5960.31, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.85 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-21
SPONSOR’S CERTIFICATION NO. 7

PLANNING AGENCY REVIEW
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that, if constructing a new facility or expanding an existing facility, it shall provide to AHP contemporaneously with this Certification a one-to-two-page narrative report summarizing the results of any preliminary planning meeting with the planning department, or equivalent, in the jurisdiction where the Project is located, including any written documentation and comments received.

I certify under penalty of perjury that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 7, Planning Agency Review, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.86 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-22
SPONSOR’S CERTIFICATION NO. 8

DUE DILIGENCE COMPLETED
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. In the event that the Project involves the acquisition of real property with Program Funds, the Sponsor certifies that it has obtained a Certified Appraisal Report, setting forth an opinion of fair market value of the real property upon which the Project is to be constructed or operated, prepared by a certified appraiser licensed in the State of California, in a form acceptable to AHP; and the Sponsor has provided copies of the Certified Appraisal Report to AHP.

4. The Sponsor certifies that it has obtained a Phase I environmental site assessment of the Project in conformance with ASTM Standard Practice E-1527 and, if necessary, a Phase II environmental site assessment and that the Sponsor has or shall comply with all recommendations in those assessments as part of the Project. The Sponsor shall provide AHP with copies of all environmental reports and, to the extent applicable, evidence of completion of any recommended environmental remediation.

5. In the event that the Project involves rehabilitation or renovation of an existing structure, the Sponsor certifies that it has obtained an asbestos assessment and lead-based paint report for the Project and has complied or shall comply with all abatement requirements identified therein. The Sponsor certifies that it has provided AHP with copies of all asbestos and lead-based paint reports and, to the extent applicable, evidence of completion of any recommended asbestos or lead-based paint abatement.

6. The Sponsor certifies that it has complied with all applicable federal, state, and local relocation requirements related to the Project, including under the California Relocation Assistance Law (California Government Code section 7260 et seq.); and that the Sponsor has complied with all applicable state laws and corresponding regulations for the safe transfer and relocation of residents in residential care facilities licensed by the State and agrees to obtain a State-approved relocation plan for each resident in care.

7. The Sponsor’s above certifications are solely for the purpose of confirming that the Sponsor has properly discharged their obligations under the Program Funding Agreement, and AHP’s

16.87 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-23
receipt of these certifications should not be relied upon by the Sponsor or any third parties as a warranty or representation by AHP or DHCS as to the quality of the design or construction of the Project.

8. The Sponsor agrees that it is solely responsible and liable for compliance with requirements and recommendations pertaining to asbestos, lead, environmental assessment, local planning, and relocation requirements for the Project and shall indemnify AHP and the State consistent with the terms of the Sponsor’s Agreement with AHP and the State.

I certify under penalty of perjury that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 8, Due Diligence Completed, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.88 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-24
SPONSOR’S CERTIFICATION NO. 9
DESIGN DEVELOPMENT DRAWINGS 100% COMPLETE
(to be completed by the Sponsor’s Architect)
I, ___________________________, as an authorized representative of ___________________________ (the “Architect”), on behalf of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Architect, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with the Sponsor’s application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. I am the lead architect on behalf of the Sponsor for the Project, duly licensed to practice architecture in the State of California pursuant to Chapter 3 of Division 3 of the Business and Professions Code, and have been hired by the Sponsor to provide architectural services for the Project.

4. I hereby certify that design development drawings, including architectural and mechanical, electrical, and plumbing (MEP) drawings for the Project, are one hundred percent (100%) complete.

5. I hereby certify that the Sponsor is ready to commence preparation of construction drawings for the purpose of submittal to the building department, or equivalent, in the jurisdiction where the Project is located.

SIGNATURE ON THE FOLLOWING PAGE

16.89 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-25
I certify under penalty of perjury that the above information is true and correct in Sponsor’s Certification No. 9, Design Development Drawings 100% Complete, as a condition of the Sponsor receiving the Program Funds.
_________________________________
Authorized Signature
(Licensed Architect on plan set)
_________________________________
Typed Name of Signatory
_________________________________
Title of Signatory
(Licensed Architect on plan set)
_________________________________
Date

16.90 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-26
SPONSOR’S AND ARCHITECT’S CERTIFICATION NO. 10

CONSTRUCTION DRAWINGS FOR

FIRST SUBMITTAL TO BUILDING DEPARTMENT
(to be completed by the Sponsor and the Sponsor’s Architect) I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), and I, __________________, as an authorized representative of ________________________________ (the “Architect”), each hereby certify that:

1. The Sponsor and Architect each certify that they possess the legal authority to submit this certification on behalf of the Sponsor and the Architect, respectively, and the information and statements set forth below are, to the best of their knowledge and belief, true and correct.

2. The Sponsor and Architect each certify that they are providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that it has obtained updated estimates of all applicable fees and charges due to the local jurisdiction with permitting authority over the Project, including, but not limited to, fees for plan checks, building permits, schools, special assessments, impact fees, and fire permits, among others, as may be applicable to the Project, depending on the jurisdiction, and the Sponsor has sent copies of all such fee estimates to AHP.

4. The Sponsor and Architect each certify that they have construction drawings for the Project that are ready for first submittal to the building department, or its equivalent, in the jurisdiction where the Project is located. The Sponsor shall provide AHP with copies of all such drawings upon request.

5. The Sponsor certifies that it is prepared to submit complete applications and pay required fees to the applicable government authorities for building permits and approvals necessary to construct the Project.

6. The Sponsor and Architect shall attest by their signatures below that the construction drawings for the Project are ready for first submittal to the building department, or its equivalent, in the jurisdiction where the Project is located, within thirty (30) days of the date of execution of this Certification No. 10.

SIGNATURES ON THE FOLLOWING PAGE

16.91 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-27
I certify under penalty of perjury that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s and Architect’s Certification No. 10, Construction Drawings for First Submittal to Building Department, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date
______________________________________________________________________________ _________________________________
Authorized Signature
(Licensed Architect on plan set)
_________________________________
Typed Name of Signatory
_________________________________
Title of Signatory
(Licensed Architect on plan set)
_________________________________
Date

16.92 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-28
SPONSOR’S CERTIFICATION NO. 11

CONSTRUCTION CONTRACT WITH

CONSTRUCTION CONTRACT ADDENDUM
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that it has negotiated and attached to this Certification a construction contract for the Project as mutually agreed upon by the Sponsor and the general contractor (“Construction Contract”) which includes a total cost of construction that does not exceed the amount set forth in the application for Program Funds for construction costs of the Project, unless otherwise approved by AHP or the State, in their sole discretion.

4. The Sponsor further certifies that the Construction Contract includes an attachment thereto, in the form attached to the Program Funding Agreement as Attachment I (the “Construction Contract Addendum”), which shall contain certain required additional details, conditions, or terms to be agreed upon by and between the Sponsor and the general contractor.

5. Upon full execution of the Construction Contract or any amendment thereof, the Sponsor promptly shall provide AHP a copy of the fully executed Construction Contract, with the Construction Contract Addendum attached thereto and incorporated by reference.

6. The Sponsor certifies that the Construction Contract Addendum, as incorporated into the Construction Contract, shall not be amended or modified in any manner, at any time, without prior approval by AHP or the State, in their sole discretion.

7. The Sponsor certifies that the final Construction Contract for the full course of construction of the Project is based on the fully permitted set of construction drawings, which constitute the full scope of the construction for the Project.

8. The Sponsor certifies that the General Contractor is registered with the California Department of Industrial Relations (“DIR”) as required by California Labor Code section 1725.5. The Sponsor further certifies that the Construction Contract and any subcontracts entered into by the general contractor shall require the general contractor and all subcontractors to comply with California Labor Code section 1720 et seq. for all work performed for the Project, including, but not limited to, the payment of prevailing wages for all work performed on the Project.

16.93 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-29
I certify under penalty of perjury that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 11, Construction Contract with Construction Contract Addendum, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.94 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-30
GENERAL CONTRACTOR’S CERTIFICATION NO. 12

PREVAILING WAGE COMPLIANCE
(to be completed by the Sponsor’s General Contractor)
I, _____________________________________, as an authorized representative of [insert name of General Contractor] (“General Contractor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the General Contractor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) submitted by City of Santa Cruz, a California municipal corporation (the “Sponsor”) and acknowledge that the State, and its contract manager, Advocates for Human Potential, Inc. (“AHP”), and the Sponsor are relying on this information in awarding and disbursing Program Funds to the Sponsor.

3. General Contractor certifies that all construction work performed on the Project shall comply with California Labor Code section 1720 et seq. and require the payment of prevailing wages.

4. General Contractor certifies that the Sponsor has provided General Contractor with copies of California Labor Code sections 1771, 1775, 1776, 1777.5, 1813, and 1815; that the construction contract includes those California Labor Code provisions; and that such California Labor Code provisions shall be included in all subcontracts entered into by General Contractor for the Project.

5. General Contractor agrees to periodically review its subcontractors’ payroll records to monitor compliance with California prevailing wage requirements and to take diligent action if General Contractor discovers any failure by a subcontractor to pay prevailing wages and to otherwise comply with the requirements of the California Labor Code.

6. General Contractor shall not release final payment to any subcontractors for work performed on the Project until General Contractor has obtained an affidavit signed under penalty of perjury from the subcontractor that the subcontractor has paid the specified general prevailing wage for all work performed on the Project as well as any other amounts due under the California Labor Code.

7. General Contractor agrees to keep accurate payroll records in compliance with California Labor Code section 1776 and shall require all of its subcontractors to keep such records and to make such records available to the California Department of Industrial Relations (“DIR”) in accordance with California Labor Code section 1771.4(a)(3).

8. General Contractor agrees to comply with any and all other requirements of the California Labor Code related to prevailing wages, all California wage and hours laws, and any applicable federal labor and wage and hours requirements for the duration of the Project.

16.95 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-31

9. General Contractor acknowledges that neither the State nor AHP shall be liable for any penalties or damages resulting from General Contractor’s failure to comply with all requirements related to public works projects applicable to the Project.

I certify that the above information is true and correct and that General Contractor shall comply with all requirements set forth above, in General Contractor’s Certification No. 12, Prevailing Wage Compliance, as a condition of the Sponsor receiving the Program Funds. _________________________________
Authorized Signature
(General Contractor)
_________________________________
Typed Name of Signatory
(General Contractor)
_________________________________
Title of Signatory
_________________________________
Date

16.96 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-32
SPONSOR’S CERTIFICATION NO. 13

UTILITY SERVICE COMMITMENTS, BUILDING PERMIT RECEIPT AND NOTICE

OF EXEMPTION FILED
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that it has obtained and provided to AHP copies of any written utility service commitments (commonly referred to as “will serve letters”), as may be required by the local jurisdiction with permitting authority over the Project.

4. The Sponsor certifies that it has obtained and provided to AHP copies of the building permits required to commence construction on the Project issued by the local jurisdiction with permitting authority over the Project. The building permits approve a total building area for the Project of [insert number in words (Number) and delete this note] square feet.

5. The Sponsor certifies that, upon receipt of the building permits from the jurisdiction where the Project is located, a Notice of Exemption for the Project has been filed with the county clerk of each county in which the Project is located pursuant to the California Environmental Quality Act (“CEQA”) Guidelines section 15062.

6. The Sponsor further certifies that it has provided to DHCS a copy of the Notice of Exemption for the Project filed with the county clerk of each county in which the Project is located pursuant to the CEQA Guidelines section 15062.

SIGNATURE ON THE FOLLOWING PAGE

16.97 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-33
I certify under penalty of perjury that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 13, Building Permit Receipt and Notice of Exemption Filed, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.98 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-34
SPONSOR’S CERTIFICATION NO. 14

REQUIRED INSURANCE AND NOTICE TO PROCEED
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that it has acquired all general liability and any applicable builder’s risk and property insurance pursuant to the requirements of Article 11 of the Program Funding Agreement.

4. The Sponsor certifies that it has provided to AHP copies of its certificates of insurance in accordance with the requirements of Article 11 of the Program Funding Agreement.

5. The Sponsor certifies that it has provided to AHP an updated budget and schedule for the Project prior to the Sponsor’s issuance of a notice to proceed to its general contractor.

6. The Sponsor certifies that on or about ______________________, 202__, [insert date and delete this note] a notice to proceed was issued to its general contractor to commence construction on the Project.

SIGNATURE ON THE FOLLOWING PAGE

16.99 ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS F-35
I certify that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 14, Required Insurance and Notice to Proceed, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.100

ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS
F-36
SPONSOR’S CERTIFICATION NO. 15
PROJECT CONSTRUCTION IS 50% COMPLETE
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that on or about ______________________, 202__, [insert date and delete this note] Project construction is fifty percent (50%) complete; and further certifies that it has provided to AHP an updated budget and schedule for the completion of the Project.

4. The Sponsor further certifies that it has the additional funds or funding necessary to complete the Project in the event that the remaining Program Funds are insufficient to satisfy the remaining fifty percent (50%) of construction costs.

I certify that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 15, Project Construction Is 50% Complete, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.101

ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS
F-37
SPONSOR’S CERTIFICATION NO. 16

RECEIPT OF CERTIFICATE OF OCCUPANCY
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that the Project has received its Certificate of Occupancy or equivalent from the jurisdiction where the Project is located.

4. The Sponsor further certifies that it has provided to AHP a copy of the Certificate of Occupancy.

I certify that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 16, Receipt of Certificate of Occupancy, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.102

ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS
F-38
SPONSOR’S CERTIFICATION NO. 17

NOTICE OF COMPLETION AND

RECEIPT OF CONDITIONAL/UNCONDITIONAL FINAL RELEASES OF LIENS I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that, pursuant to California Civil Code section 8182 et seq., it has recorded with the county clerk in the jurisdiction where the Property is located a Notice of Completion; and that the Sponsor has provided to AHP a copy of the Notice of Completion.

4. The Sponsor certifies that it has obtained from its general contractor conditional/unconditional final releases of all liens for all labor or services provided, or equipment and material delivered, to or on behalf of the Sponsor, for construction or rehabilitation at the Project.

5. The Sponsor further certifies that it has provided to AHP copies of all conditional/unconditional final releases of all liens, which the Sponsor received from its general contractor, and that the Sponsor shall provide to AHP any additional release of lien documentation or information, as may be required by AHP and/or the State in their sole discretion.

SIGNATURE ON THE FOLLOWING PAGE

16.103

ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS
F-39
I certify that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 17, Notice of Completion and Receipt of Conditional/Unconditional Final Releases of Liens, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.104

ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS
F-40
SPONSOR’S CERTIFICATION NO. 18

RECEIPT OF BUSINESS LICENSE AND OPERATIONAL
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that the Sponsor and the Project, each, as may be required, individually and collectively, has received, renewed, or maintained all licenses, designations, and certifications, including a business license, as may be required, by the jurisdiction where the Project is located and by the State, to operate the Project pursuant to the requirements of the Program Funding Agreement.

I certify that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 18, Receipt of Business License and Operational, as a condition of receiving the Program Funds.

Authorized Signature
Typed Name of Signatory
Title of Signatory
Date

16.105

ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS
F-41
SPONSOR’S CERTIFICATION NO. 19

EXECUTION OF A FACILITY ACCESS AGREEMENT WITH STATE OF

CALIFORNIA,

DEPARTMENT OF HEALTH CARE SERVICES
I, Matt Huffaker, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor, and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”), are relying on this information in awarding and disbursing Program Funds.

3. The Sponsor certifies that it has executed a contract with the State Department of Health Care Services (“DHCS”) entitled Facility Access Agreement (“Facility Access Agreement”).

4. The Sponsor certifies that it has provided a true and correct copy of the executed Facility Access Agreement, including all attachments, to AHP.

I certify that the above information is true and correct and that the Sponsor shall comply with all requirements set forth above, in Sponsor’s Facility Certification No. 19, Execution of a Facility Access Agreement with State of California, Department of Health Care Services, as a condition of receiving the Program Funds.
[counterpartySignerSignature_Jb4IGyk]
Authorized Signature
Matt Huffaker
Typed Name of Signatory
City Manager
Title of Signatory
[counterpartySignerDateField_i1G9PNy]
Date

16.106

ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS
F-42
SPONSOR’S CERTIFICATION NO. 20

PROJECT CLOSE-OUT, RETENTION FUNDS, EXCESS FUNDS, AND CONTINUED

COMPLIANCE
I, ___________________________, as an authorized representative of City of Santa Cruz, a California municipal corporation (the “Sponsor”), hereby certify that:

1. I possess the legal authority to submit this certification on behalf of the Sponsor and the information and statements set forth below are, to the best of my knowledge and belief, true and correct.

2. I am providing this information in connection with an application for funding from the State of California (“State”) pursuant to the Behavioral Health Continuum Infrastructure Program (“BHCIP”) for the Santa Cruz Coral Street SUD Campus (“Project”) and acknowledge that the State and its contract manager, Advocates for Human Potential, Inc. (“AHP”) are relying on this information in connection with the management of BHCIP and Program Funds.

3. The Sponsor certifies that it received an award of Program Funds pursuant to that certain Notice of Conditional Award Letter issued by DHCS to the Sponsor, attached as Attachment K to that certain Program Funding Agreement, dated [companySignerDateField_rMRH9gJ] (the “Program Funding Agreement”) by and between AHP and the Sponsor.

4. The Sponsor certifies that AHP has released and the Sponsor has received Retention Funds pursuant to Section 4.3.7.1 of the Program Funding Agreement.

5. The Sponsor certifies that the Project is complete, operational, and serving patients/persons in compliance with all applicable state, federal, and local health and safety laws and ordinances.

6. The Sponsor certifies that it will not request, declines to use, and releases a portion of its awarded Program Funds in the amount of ________________________ Dollars ($________________________) (“Excess Funds”). The Sponsor further certifies that the Excess Funds are not required for Project completion or reimbursement for its Project expenses.

7. The Sponsor acknowledges that pursuant to Article 2 of the Program Funding Agreement, the terms of the Program Funding Agreement are in full force and effect.

8. The Sponsor further certifies that it has satisfied all applicable requirements of the Program Funding Agreement, is not in default, and shall continue to comply with the requirements of the Program Funding Agreement, the Facility Access Agreement, and the Declaration of Restrictions, each as defined in the Program Funding Agreement.

SIGNATURES ON THE FOLLOWING PAGE

16.107

ATTACHMENT F THE SPONSOR COMPLIANCE CERTIFICATIONS
F-43
I certify under penalty of perjury that the above information is true and correct and that Sponsor shall comply with all requirements set forth above, in Sponsor’s Certification No. 20, Project Close-Out, Retention Funds, Excess Funds, and Continued Compliance. ________________________________
Authorized Signature
_________________________________
Typed Name of Signatory
_________________________________
Title of Signatory
_________________________________
Date
ACKNOWLEDGED:

DHCS:

DEPARTMENT OF HEALTH CARE SERVICES,
a public agency of the State of California
By: ________________________________
Laurice Artap, Section Chief
Community Services Division / Behavioral Health Continuum Infrastructure Program Section
Date: _________________________________

16.108

ATTACHMENT G PERFORMANCE MILESTONES
G-1

ATTACHMENT G

PERFORMANCE MILESTONES
PHASE Milestone Certification or Documents
Certification # 1
Certification # 2
Certification # 3
Certification # 5
Certification # 6
Certification #19
E.2 Match Minimum
Requirements
Certification # 4
Recorded Deed
Certification # 7
Certification # 8
Certification # 7
Certification # 8
Certification # 9
Certification # 10
Certification # 11
Certification # 12
Certification # 13
Certification # 14
E.6
Project Construction
50% Complete
Certification # 15
Certification # 16
Certification # 17
Certification # 18
Certification # 20
These Performance Milestones are the basis for your Project's Payment Schedule so that in all events, all Program Funds must be obligated and expended by June 30, 2030.

ATTACHMENT G - PERFORMANCE MILESTONES
BOND BHCIP Round 1: Launch Ready
DESIGN DEVELOPMENT DRAWINGS 100% COMPLETE

CLOSE OF ESCROW/RECORDED DECLARATION OF RESTRICTIONS
& PERFORMANCE DEED OF TRUST

EXECUTION OF A FACILITY ACCESS AGREEMENT WITH STATE OF

CALIFORNIA, DEPARTMENT OF HEALTH CARE SERVICES

MATCH FUNDS, PROPERTY EQUITY, OR IN-KIND MATCH

PLANNING AGENCY REVIEW

DUE DILIGENCE COMPLETED FOR ACQUISTION
E.1 Minimum Requirements

BUDGET PREVAILING WAGE COMPLIANCE

RELATED PARTY AND RELATED PARTY TRANSACTION DISCLOSURE
Projectspecific, N/A

LEGAL REVIEW OF CA WELFARE AND INSTITUTIONS CODE
§5960.3(a)

EXECUTION OF PROGRAM FUNDING AGREEMENT

NOTICE OF COMPLETION AND RECEIPT OF UNCONDITIONAL

FINAL RELEASES OF LIENS
COMPLETION DATE: Not To Exceed

RECEIPT OF BUSINESS LICENSE AND OPERATIONAL

CONSTRUCTION DRAWINGS FOR FIRST SUBMITTAL TO BUILDING DEPT

PROJECT CLOSE-OUT, RETENTION FUNDS, EXCESS FUNDS, AND

CONTINUED COMPLIANCE

REQUIRED INSURANCE AND NOTICE TO PROCEED
PROJECT CONSTRUCTION IS 50% COMPLETE

RECEIPT OF CERTIFICATE OF OCCUPANCY

CONSTRUCTION CONTRACT WITH CONSTRUCTION CONTRACT RIDER

PREVAILING WAGE COMPLIANCE (GC)

UTILITY SERVICE COMMITMENTS, BUILDING PERMIT RECEIPT,

AND NOTICE OF EXEMPTION FILED
Preconstruction/Acquisition, Construction, Move-in

ESTIMATED MILESTONES
E.3
Acquisition
PLANNING AGENCY REVIEW, if not previously provided

ANTICIPATED EXPIRATION DATE OF THE AGREEMENT &

TRANSFER TO STATE OVERSIGHT

MILESTONE

RECORDED DECLARATION OF RESTRICTIONS
E.4
Preconstruction
(Planning and
Permitting)
E.5
Start of Construction
(Notice to Proceed and
Executed Construction
Contract)
E.7
Construction Complete,
Licensing, and
Operation
Projectspecific, N/A
6/30/2030
6/30/2030
DUE DILIGENCE COMPLETED, if not previously provided

16.109

ATTACHMENT H DECLARATION OF RESTRICTIONS
H-1

ATTACHMENT H

REGULATORY AGREEMENT AND

DECLARATION OF RESTRICTIONS
This Regulatory Agreement and Declaration of Restrictions (the “Declaration”), dated ____________ for reference purposes, is by and between CITY OF SANTA CRUZ, a California municipal corporation (the “Owner”) and the State of California (the “State”), represented by the DEPARTMENT OF HEALTH CARE SERVICES, a public agency of the State of California (“DHCS”).

RECITALS
A. DHCS oversees the Behavioral Health Continuum Infrastructure Program (“BHCIP” or “Program”), which was established by California Assembly Bill No. 133 (Chapter 143, Statutes of 2021), and which is governed by California Welfare and Institutions Code sections 5960-5960.4, as amended by the State Behavioral Health Infrastructure Bond Act of 2024 (section 4, Chapter 4 of California Assembly Bill 531 (“AB 531”)) which provided, in part, for the: (a) addition of section 5965.04 to the California Welfare and Institutions Code allocating additional funding to the Program; and (b) repealed section 5960.45 from the California Welfare and Institutions Code.

B. Under BHCIP, DHCS awards State Behavioral Health Infrastructure Bond Act of 2024 funds (“Bond BHCIP Funds”) to qualified entities, through competitive grants, to construct, acquire, and rehabilitate real estate assets to build new capacity or expand existing capacity for facilities that will operate for a minimum of thirty (30) years to provide short-term crisis stabilization, acute and subacute care, crisis residential, community-based mental health residential, substance use disorder residential, peer respite, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly settings; C. On July 17, 2024, DHCS issued a Request for Applications (“RFA”) for Bond BHCIP Funds and selected Owner’s Project (as defined below) as a recipient of Bond BHCIP Funds. Advocates for Human Potential, Inc., a Massachusetts corporation (“AHP”), acting as the initial program administrator for the initial five (5) year building phase of BHCIP, entered into a Program Funding Agreement with an Effective Date of [companySignerDateField_AM1UVKs]

RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:

Advocates for Human Potential, Inc.
490-B Boston Post Road
Sudbury, MA 01776-3365
Attention: Legal Department

NO FEE FOR RECORDING PURSUANT TO
GOVERNMENT CODE SECTION 27383
SPACE ABOVE THIS LINE FOR RECORDER’S USE

16.110

ATTACHMENT H DECLARATION OF RESTRICTIONS
H-2
(the “Program Funding Agreement”), with Owner for the distribution of Bond BHCIP Funds in an amount not to exceed Thirty Million Dollars and Zero Cents ($30,000,000.00) (the “Program Funds”) over the above-mentioned five (5) year building phase for Owner to acquire, expand, or construct certain improvements more particularly described in the RFA (“Owner’s Project”) on that certain real property commonly known as 125 Coral Street, located in the City of Santa Cruz (“City”), County of Santa Cruz (“County”), State of California, and the improvements thereon (the “Property”), as more particularly described and shown on Exhibit A, attached hereto and incorporated herein by this reference;
D. As an award recipient, in consideration for the Program Funds, and in order to comply with the policies, programs, and applicable legislation, including the RFA, the Program Funding Agreement, the Facility Access Agreement between DHCS and the Owner, and BHCIP, the Property and the owner thereof are subject to certain requirements and restrictions, including, without limitation, the obligation to ensure that the Property shall be used for residential services in the portion of the Property depicted in the Site Plan, as set forth in Schedule 1(a), attached hereto and incorporated herein by this reference, and the Floor Plan, as set forth in Schedule 1(b), attached hereto and incorporated herein by this reference (the “Permitted Use”) for the Restriction Period (defined below), subject to change or modification to another use set forth in Exhibit B, attached hereto, and incorporated herein by this reference, with DHCS approval, which must accept and provide services to Medi-Cal beneficiaries as patients; E. The Property shall be owned, held, used, maintained, and transferred pursuant to the covenants, conditions, restrictions, and limitations as further described herein; and F. Owner and DHCS have agreed to enter into this Declaration to memorialize some of the aforementioned requirements and restrictions in the public record that will survive the expiration of the Program Funding Agreement to ensure compliance with the same.

NOW, THEREFORE, in consideration of the Program Funds paid to the Owner under the Program Funding Agreement and for other valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Owner hereby enters into this Declaration and hereby covenants, agrees, and declares the following:

AGREEMENT

1. Use of Property. Owner, for itself and for its successors and assigns, hereby declares and covenants that, for the Restriction Period, the use of the Property, or in the event only a portion thereof has been improved with the use of Program Funds, then only that portion that has been so improved shall be restricted to the Permitted Use. Any change to another use described in Exhibit B, attached hereto and incorporated herein by this reference, shall require the express prior written approval of DHCS in its sole and absolute discretion, which modification and consent may be recorded in the official records of the County.

2. Use, Maintenance, Repair, and Improvement of the Property. Owner agrees:

2.1 To use the Property, or that portion of the Property constructed or improved with Program Funds, continuously for the Permitted Use;

16.111

ATTACHMENT H DECLARATION OF RESTRICTIONS
H-3

2.2 To maintain the Property in conformity with the habitability and fire codes of the City or County where the Property is located in decent, safe, and sanitary condition and repair, and to permit no waste thereof;

2.3 Not to commit or suffer to be done or exist on or about the Property any condition causing the Property to become less valuable, except in accordance with this Declaration;

2.4 Not to apply for any permits or construct any buildings or improvements on the Property, other than the permits, buildings, and improvements contemplated as part of this Declaration, that would detrimentally affect the Property, including, without limitation, the value of the Property, the structural integrity of the Property, or the contemplated uses of the Property set forth in Exhibit B; or add to, remove, demolish, or structurally alter any buildings or improvements included as part of the Property purchased or improved with Program Funds, without DHCS’s consent;

2.5 To comply with all applicable laws affecting the Property, including, but not limited to, Behavioral Health Continuum Infrastructure Program, authorized by California Welfare and Institutions Code sections 5960-5960.4, and not to suffer or permit any violations of any such applicable law, nor of any covenant, condition, or restriction affecting the Property. To the extent an amendment to the foregoing imposes requirements upon the ownership or operation of the Project more restrictive than those imposed by this Declaration, this Declaration shall be deemed automatically amended, without consent or approval of any other person, to impose such additional or more restrictive requirements; however, Owner hereby agrees to execute such amendment upon request by DHCS;

2.6 To construct and maintain the deliverables developed and produced pursuant to the Program Funding Agreement in compliance with the accessibility requirements of sections 7405 and 11135 of the California Government Code, section 508 of the Rehabilitation Act of 1973 as amended (29 U.S.C. § 794d), regulations implementing the Rehabilitation Act of 1973 as set forth in Part 1194 of Title 36 of the Code of Federal Regulations, and the Americans with Disabilities Act of 1990 (42 U.S.C. § 12101 et seq.);

2.7 Not to initiate or acquiesce in any change in any zoning or other land use or legal classification which affects any of the Property without DHCS’s prior written consent, which may be granted or withheld at DHCS’s sole discretion;

2.8 Not to alter the use of all or any part of the Property constructed or improved with Program Funds without DHCS’s prior written consent;

2.9 To maintain all licenses, certifications, or designations required to continue operating for the use specified in the Program Funding Agreement, or other use approved in writing by DHCS;

2.10 To pay to DHCS its then-current fees in connection with any consent, approval, transfer, amendment, or waiver requested by Owner, together with any expenses incurred by DHCS in connection therewith;

16.112

ATTACHMENT H DECLARATION OF RESTRICTIONS
H-4

2.11 To submit to DHCS such periodic reports, updates, and information deemed necessary by DHCS to monitor compliance and/or perform program evaluation. Any requested data or information shall be submitted in electronic format in a manner specified by DHCS;

2.12 To pay all taxes, assessments, and other charges, liens, fines, and impositions attributable to or encumbering the Property, by making payment, prior to delinquency, directly to the payee thereof. Owner shall, upon request by DHCS or its agent, promptly furnish to DHCS or its agent all notices of amounts due under this subsection and receipts evidencing such payments. Owner shall have the right to contest in good faith any claim or lien, or payment due thereunder, so long as Owner does so diligently, without prejudice to DHCS, and provided that Owner has established on Owner’s books adequate reserves with respect to such contested assessment, tax, charge, lien, or claim; and

2.13 To defend (with counsel satisfactory to DHCS, in DHCS’s sole discretion), indemnify, and hold harmless DHCS and its respective officers, members, supervisors, directors, officials, and employees, counsel, attorneys, and agents, past, present, and future of each of them (collectively, the “Indemnified Parties”) against all loss, costs, damages, expenses, suits, judgments, actions, and liabilities of whatever nature (including, without limitation, reasonable attorneys’ fees, litigation and court costs, and amounts paid in settlement) directly or indirectly resulting from or arising out of or related to (a) the operation, use, occupancy, maintenance, financing or ownership of the Owner’s Project, and (b) any breach of the foregoing obligations.

Owner shall pay, upon demand, all of the reasonable fees and expenses paid or incurred by DHCS in enforcing the provisions of this Declaration against Owner.

3. Restrictions On Sale, Encumbrance, And Other Acts.

3.1 Owner shall not voluntarily (which term shall not be interpreted to include a foreclosure of any security for a loan or deed-in lieu) sell, encumber (including recordation of deeds of trust), hypothecate, assign, pledge, convey, or transfer the Property, or any portion thereof, or any of its interests therein, equity interest in Owner, or any general partner interest in the Owner without obtaining DHCS’s prior written consent, which shall not be unreasonably withheld by DHCS, in DHCS’s sole discretion, if (a) the Owner is not in default hereunder or under the Program Funding Agreement and delivers a certificate to DHCS certifying to the same; (b) the purchaser or assignee is not in default under any obligations it may have to DHCS and is not the subject of any legal or enforcement actions by DHCS; (c) evidence reasonably satisfactory to DHCS is presented to establish that the purchaser or assignee has prior experience in the successful development, ownership, and/or operation of a facility described in Exhibit B for individuals who qualify as members of the target population, or has a partner with said relevant experience; (d) DHCS shall have received reasonable evidence satisfactory to DHCS that the Owner’s purchaser or transferee has assumed, in writing, the restrictions on the Property and Owner’s duties and obligations under this Declaration and the Program Funding Agreement; (e) evidence satisfactory to DHCS that the purchaser or assignee does not have pending against it, nor does it have a history of, building or fire code violations as identified by any department of DHCS; and (f) such other conditions as the State may reasonably impose to ensure compliance by the assignee or purchaser and Property with the requirements of this Declaration and Program Funding Agreement. It is expressly stipulated and agreed that, except for any such sale, transfer or disposition agreed to by DHCS in a separate writing, any sale, transfer, or other disposition of the

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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Property in violation of this Section 3 shall be null and void, and shall not relieve the Owner of its obligations under this Declaration. Upon any sale or transfer which complies with this Declaration, the Owner shall be fully released from any obligations arising after said sale or transfer, but only to the extent such obligations have been assumed by the transferee of the Property. Any transfer of the Property to any entity, whether or not affiliated with the Owner, shall be subject to the provisions of this Section 3.

3.2 If DHCS determines, in its reasonable discretion, to grant its prior written consent for a sale, assignment, transfer, or conveyance of the Property, such consent may impose additional terms and conditions, as necessary, to preserve or establish the fiscal integrity of the Property or to ensure compliance with this Declaration.

3.3 If a trustee under a loan acquires title to the Property by foreclosure or deed in lieu of foreclosure, no consent of the State shall be required to such transfer under this Declaration; however, the consent of DHCS and delivery of items (a) through (f) in Section 3.1 above shall be required for any transfer of the Property subsequent to the trustee’s acquisition of the Property by foreclosure or deed in lieu of foreclosure.

4. Insurance, Casualty, and Condemnation.

4.1 During the Restriction Period, Owner shall obtain and maintain (i) property insurance insuring against, among other things, loss of the Property, or any portion thereof, and Owner’s personal property and fixtures by fire and such other hazards and casualties; (ii) commercial liability insurance insuring against liabilities arising out of the ownership, use, occupancy, condition, or maintenance of or the operations, use, and activities in, on, or about the Property; and (iii) other such insurance required by DHCS, and in such amounts as required by DHCS, which policies shall include DHCS as an additional insured upon request by DHCS. All insurance policies and renewals thereof shall be issued by a carrier and in a form acceptable to DHCS. Owner may choose to self-insure to comply with these requirements and agrees to provide written evidence of such insurance coverage within five (5) days of such request by DHCS or AHP.

4.2 In the event of any fire or other casualty to the Property or any part thereof, Owner shall immediately notify DHCS and seek direction from DHCS on how to proceed. DHCS, in its sole and absolute discretion, shall determine whether to instruct the Owner to apply the insurance proceeds to repayment to DHCS of the unamortized Program Funds. DHCS has the right but not the obligation to approve the plans and specifications for any repair and restoration, as well as the right but not the obligation to approve disbursements of insurance proceeds for repair and restoration under a construction escrow or similar arrangement.

5. Covenants Run with the Land. The Property is held and hereafter shall be held, conveyed, hypothecated, encumbered, leased, rented, used, and occupied subject to this Declaration. Notwithstanding section 1460, et seq., of the California Civil Code, the provisions hereof shall run with the land and may be enforced either in law or equity by any State agency.

DHCS and Owner hereby declare their express intent that the covenants, reservations, and restrictions contained herein shall be deemed both equitable servitudes and covenants running with the land and shall pass to and be binding upon the Owner’s successors in title to the Property;

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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provided, however, that upon the expiration of the Restriction Period said covenants, reservations, and restrictions shall expire. Owner expressly acknowledges and agrees that the Declaration is a reasonable restraint on Owner’s right to own, use, maintain, and transfer the Property and any estate or interest therein and is not and shall not be construed to be an unreasonable restraint on alienation. Each and every contract, deed, or other instrument hereafter executed covering or conveying the Property, or any portion thereof, shall be held conclusively to have been executed, delivered, and accepted subject to this Declaration, regardless of whether this Declaration is set forth in such contract, deed, or other instrument.

6. Term of Declaration. The covenants in this Declaration shall be binding, effective, and enforceable commencing upon the recordation of this Declaration on the fee estate in land in the official records of the County, and they shall continue in full force and effect for a period of at least thirty (30) years after the date of either of the following: (i) the date of issuance of a Certificate of Occupancy, if the Owner’s Project is for construction of a new facility, or (ii) the date of recordation of a Notice of Completion, in the official records of the County, if the Project is for the rehabilitation or expansion of an existing facility on the Property (the “Restriction Period”), regardless of any sale, assignment, transfer, or conveyance (including, without limitation, by foreclosure sale) of the Property or any portion thereof to any other person or entity.

7. Default, Remedies. If Owner defaults in the performance or observance of any covenant, agreement, restriction, or obligation of Owner set forth in this Declaration, and if such default remains uncured for a period of thirty (30) days after notice therefore shall have been given by DHCS to the Owner, then DHCS shall declare an “Event of Default” to have occurred hereunder. An Event of Default under this Declaration shall entitle DHCS to any rights, remedies, or damages available in law or equity, including, but not limited to, those that are specified in Section 7.1-7.4 below. DHCS’s failure to exercise any specific right or remedy shall not be construed as a waiver of that or any other right or remedy. An Event of Default under this Declaration shall also constitute a default under the Program Funding Agreement, in the event the same has not expired by its terms.

7.1 Specific Performance. The use, repair, and maintenance of the Property is of a special and unique kind and character, so that a breach of any material provision of this Declaration by Owner would not have an adequate remedy in law. Therefore, DHCS’s rights may be enforced by an action for specific performance and such other equitable relief as is provided by the laws of the State of California.

7.2 Injunctive Relief. In pursuing specific performance of the Declaration, DHCS shall be entitled to petition the court for injunctive relief to enjoin any acts or things which may be in violation of this Declaration or the Program Funding Agreement. Such injunctive relief may include a court order restraining any development of the Property that is inconsistent with the foregoing Declaration.

7.3 Appointment of Receiver. In addition to or in conjunction with any other remedy available in law or equity, DHCS may apply to a court of competent jurisdiction for the appointment of a receiver to take over and operate the Property in accordance with the requirements of the Program Funding Agreement and this Declaration. The receiver shall have all

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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powers which shall be necessary or are usual in such cases for the protection, possession, control, management, and operation of the Property.

7.4 Right to Cure Defaults. Upon the occurrence and during the continuance of any Event of Default, the State may, but without any obligation to do so and without notice to or demand on Owner and without releasing Owner from any obligation hereunder, take such actions to cure the Event of Default in such manner and to such extent as the State may deem necessary to protect the security hereof. The cost and expense of any cure hereunder (including reasonable attorneys’ fees to the extent permitted by law) shall be due and payable to the State upon demand, plus an administration fee of ten percent (10%).

7.5 Intentionally omitted.

8. DHCS Review and Inspection.

8.1 At any time during the term of this Declaration and upon reasonable notice, DHCS or its designee may, but is not obligated to, enter and inspect the Property and inspect all records pertaining to the operation, repair, and maintenance of the Property. Upon request by DHCS, Owner shall notify occupants of upcoming inspections in accordance with state law.

8.2 DHCS or its designee may, but is not obligated to, request any other information that it deems necessary to confirm compliance with this Declaration. Owner shall provide such requested information within fourteen (14) calendar days of DHCS’s or its designee’s written request for the information.

8.3 DHCS or its designee shall not, by the fact of making or not making any entries or inspections, or by taking or failing to take any action in response thereto: (i) incur or undertake, or be deemed to incur or undertake, any obligation, duty, or liability whatsoever, whether to Owner or to any other person or entity; (ii) be deemed as approving or disapproving any matter, action, incident, or condition related to the Property; or (iii) be deemed as approving or disapproving any matter related to the compliance of the Property with this Declaration or other applicable laws. In no event or circumstance shall DHCS’s or its designee’s exercise or nonexercise of its discretion under this subsection constitute, or be deemed or interpreted as constituting, any termination, limitation, alteration, or waiver by DHCS or its designee of any right, benefit, or remedies under or with respect to this Declaration.

9. Owner Representations. Owner represents and warrants to DHCS that: (1) Owner has sufficient interest in the Property to support the operation of the Property in accordance with this Declaration; (2) to Owner’s actual knowledge and belief, there are no agreements, contracts, covenants, conditions, or exclusions to which Owner (or its predecessor in interest) is a party which would, if enforced, prohibit or restrict the use of the Property in accordance with the terms of this Declaration; (3) Owner has the full right and authority to enter into this Declaration; (4) this Declaration constitutes a valid and legally binding obligation on Owner, enforceable in accordance with its terms; and (5) Owner is duly organized, validly existing, and authorized to do business in the State of California.

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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10. Amendment, Modification. This Declaration shall be amended only by a written instrument executed by the parties hereto or their successors in title, and duly recorded in the official records of the County.

11. Severability. Every provision of this Declaration is intended to be severable. If any provision of this Declaration is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired.

12. Governing Law. This Declaration shall be governed by and interpreted under the laws of the State of California and applicable federal laws.

13. Recordation of Agreement. This Declaration shall be recorded on the fee estate in land in the official records of the County no later than December 31, 2025. The Declaration shall be recorded, and shall remain, as a lien against the Property for the Restriction Period. After the expiration of the Restriction Period, and, after the State’s receipt of a written request from Owner, the State shall execute a termination of this Declaration.

SIGNATURES ON THE FOLLOWING PAGES

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ATTACHMENT H DECLARATION OF RESTRICTIONS
H-9
IN WITNESS WHEREOF, Owner and State have caused this Declaration to be signed by their duly authorized representatives, as of the day and year first written above.

OWNER:

CITY OF SANTA CRUZ,
a California municipal corporation
By: _______________________________
Title: ______________________________
Date: ______________________________

ALL SIGNATURES MUST BE ACKNOWLEDGED

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ATTACHMENT H DECLARATION OF RESTRICTIONS
H-10

STATE OF CALIFORNIA )
)
COUNTY OF __________________ )
On ____________________, before me, ___________________________, Notary Public, personally appeared ______________________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

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

WITNESS my hand and official seal.
______________________________________
Printed Name: _________________________
Notary Public: _________________________
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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IN WITNESS WHEREOF, Owner and State have caused this Declaration to be signed by their duly authorized representatives, as of the day and year first written above.

DHCS:

DEPARTMENT OF HEALTH CARE SERVICES,
a public agency of the State of California
By:

Laurice Artap, Section Chief
Community Services Division / Behavioral Health
Continuum Infrastructure Program Section
Date: __________________________

ALL SIGNATURES MUST BE ACKNOWLEDGED

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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STATE OF CALIFORNIA )
)
COUNTY OF __________________ )
On ____________________, before me, ___________________________, Notary Public, personally appeared ______________________________________, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

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

WITNESS my hand and official seal.
______________________________________
Printed Name: ________________________,
Notary Public: ________________________
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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EXHIBIT A

LEGAL DESCRIPTION OF THE PROPERTY
Real property in the City of Santa Cruz, County of Santa Cruz, State of California, described as follows:

Parcel One:

Being Lot 3, in Block 1, as the same is shown upon that certain map entitled "HIHN'S SUBDIVISION of the Eastern part of the KING TRACT", filed for record in the office of the County Recorder of Santa Cruz County on June 14, 1894 in Map Book 12 at Page 8, Santa Cruz county records, and more particularly described as follows:

Beginning at a point on the Southerly side of Coral Street 100.34 feet distant Westerly from the Westerly boundary of lot formerly of H. Beal; thence Westerly along the Southerly side of Coral Street 50.00 feet; thence at right angles Southerly 154.52 feet to the line of the fence which is the Southern boundary of said KING TRACT; thence Easterly along said last mentioned boundary

50.33 feet; thence Northerly at right angles with coral street 148.68 feet to the Place of Beginning.

Parcel Two:

Being Lot 4, in Block 1, as the same is shown upon that certain map entitled "HIHN'S SUBDIVISION of the Eastern part of the KING TRACT", filed for record in the office of the County Recorder of Santa Cruz County on June 14, 1894 in Map Book 12 at Page 8, Santa Cruz county records, and more particularly described as follows:

Beginning at a point on the Southerly side of Coral Street 150.34 feet distant Westerly from the Westerly boundary of the lot formerly of H. Beal; thence Westerly along the Southerly side of Coral Street 50.00 feet; thence at right angles Southerly 160.35 feet to the line of the fence which is the Southern boundary of said KING TRACT;
Thence Easterly along said last mentioned boundary 50.33 feet; thence Northerly at right angles with coral street 154.32 feet to the Place of Beginning.

Parcel Three:

Being a portion of the lands conveyed to Elizabeth M. Marini, by deed recorded February 20, 1940 in volume 389, Page 234, official records of Santa Cruz County and being further described as follows:

Beginning at a 1/2 inch iron pipe R. C. E 11192 in the Easterly line of the right of way of the Southern Pacific Railroad (formerly the South Pacific Coast railroad company) at the most Westerly corner of the above described parcel of lands of Marini;

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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Thence from said Point of Beginning along the Northwesterly line of said lands North 78° 17' 10" East 159.49 feet to a 1/2 inch iron pipe R. c. E. 11192 at the Southeasterly corner of Lot 3, Block 1 of HIHN'S SUBDIVISION above mentioned; thence leaving said line South 5° 02' 20" East 81.99 feet to a 1/2 inch iron pipe R. C. E. 11192 in the Southerly line of said lands of Marini and the Northwesterly line of the lands of the regents of the University of California by deed recorded March 12, 1963 in volume 1527, Page 426, official records of Santa Cruz County; thence along the last mentioned line South 78° 42' 27" West 142.11 feet to a 1/2 inch iron pipe R. c. E. 11192 in the Easterly line of the Southern pacific railroad right of way; thence along the last mentioned line North 17° 17' 33" West 80.7.8 feet to the Point of Beginning.

APN: 008-171-24 (Parcels One and Two) and 008-171-25 (Parcel Three)

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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EXHIBIT B

PROPERTY AND OPERATIONS
The portion of the Property as shown in the Site Plan, as set forth in Schedule 1(a), attached to the Declaration, and the Floor Plan, as set forth in Schedule 1(b), attached to the Declaration (Schedule 1(a) and Schedule 1(b) are hereinafter, collectively, the “Schedules”), that provides one or more of the following behavioral health (mental health and substance use disorder) services to address significant crisis care and behavioral health gaps in California’s infrastructure, including: outpatient clinical support services, including urgent care, short-term crisis, crisis stabilization, substance use disorder, partial hospitalization; or residential clinical services that provide shelter and support, including psychiatric acute care, psychiatric health, psychiatric treatment, substance use disorder, community treatment, general acute care, acute care, mental health rehabilitation, peer respite, short-term therapeutic, skilled nursing with special treatment, or social rehabilitation. The portion of the Property as shown in Schedules shall accept and provide services to Medi-Cal beneficiaries as patients.

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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SCHEDULE 1(a)

SITE PLAN
(ATTACHED)

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ATTACHMENT H DECLARATION OF RESTRICTIONS
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SCHEDULE 1(b)

FLOOR PLAN
(ATTACHED)

16.126

ATTACHMENT I CONSTRUCTION CONTRACT ADDENDUM
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ATTACHMENT I

CONSTRUCTION CONTRACT ADDENDUM
This Construction Contract Addendum (this “Addendum”) is made this _________ day of ________________, ____, by and between City of Santa Cruz, a California municipal corporation (the “Owner”), and __________________ (the “Contractor”).

RECITALS
A. The Owner and Advocates for Human Potential, Inc., a Massachusetts corporation (“AHP”), acting as program administrator for the State of California (“State”) Department of Health Care Services, a public agency of the State of California (“DHCS”), have entered into that certain Program Funding Agreement dated [companySignerDateField_yjgNvlL] (the “Agreement”), pursuant to which Owner was allocated funds (“Program Funds”) pursuant to the Behavioral Health Continuum Infrastructure Program (“BHCIP”) for the purposes of developing the project located at 125 Coral Street, Santa Cruz, CA 95060 (the “Project”).

B. Owner and Contractor have entered into a construction agreement dated ______________, under which Contractor has agreed to undertake construction work on the Project (the “Contract”).

C. Owner and Contractor wish to modify and add to the terms of the Contract as set forth in this Addendum, and Contractor agrees to be bound by the following provisions in the construction of said Project, in order to provide for certain terms required by AHP as a condition of providing the Program Funds for the Project. It is a condition to AHP providing the Program Funds that the Contractor agrees to be bound by the terms hereof.

NOW, THEREFORE, Owner and Contractor hereby agree as follows:

1. OWNER’S OBLIGATIONS. Owner agrees that any obligation imposed on Contractor by this Addendum does not waive, diminish, or alter any of Owner’s obligations to AHP under the Agreement, and that the obligations of Contractor to AHP contained herein are in addition to those obligations of Owner to AHP or DHCS contained in the Agreement. Owner shall be solely responsible for satisfying its obligations to Contractor under the Contract.

2. CONSENT TO ASSIGNMENT OF DEVELOPMENT RIGHTS. Contractor consents to the assignment of its Contract with Owner to AHP, upon demand by AHP and written approval from DHCS, and to any subsequent assignment of the Contract by AHP at the election of AHP. Contractor agrees that if there is a breach of the Agreement or any other Event of Default (as the term may be defined in the Agreement), AHP may elect to enforce the assignment and take over the Contract. Contractor agrees to continue to perform its obligations under the Contract and this Addendum for the benefit and account of AHP in the same manner as if performed for the benefit and account of Owner in the absence of the assignment at no additional cost to AHP, as long as Contractor has received and continues to receive the compensation called for under the Contract. Contractor agrees that AHP shall not have any obligation under the Contract until AHP notifies it in writing of AHP’s election to accept the assignment. DHCS shall not provide its written approval to AHP without first consulting with the Sponsor about AHP’s request.

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3. ASSIGNMENT OF SUBCONTRACTS. Contractor hereby consents to the assignment to AHP of all its interest in all subcontracts and agreements now or hereafter entered into by Contractor for performance of any part of the construction work required to be performed under the Contract. The assignment will be effective upon acceptance by AHP in writing and only as to those subcontracts and agreements which AHP designates in writing. After obtaining DHCS written approval, AHP may accept said assignment at any time during the course of the construction work required to be performed under the Contract and prior to final completion of construction work required to be performed under the Contract in the event of a suspension or termination of Contractor’s rights under the Contract. Such assignment is part of the consideration to Owner for entering into the Contract with Contractor and may not be withdrawn prior to final completion of construction work required to be performed under the Contract. Contractor agrees that any subcontract entered by and between Contractor and a subcontractor in connection with the Contract or performance of the construction work required to be performed under the Contract shall expressly provide that such subcontract shall be assignable to AHP and that AHP subsequently may assign such subcontract. DHCS shall not provide its written approval to AHP without first consulting with the Sponsor about AHP’s request.

4. COMMENCEMENT AND COMPLETION OF CONSTRUCTION. Contractor must begin construction of the Project by the date set for the commencement of construction in the Contract.

Contractor must diligently prosecute construction of the Project to completion and must complete construction of the Project by the completion date set forth in the Contract. Incorporated herein are the Scope of Work, Performance Milestones, and Payment Schedule from the Agreement.

5. CONSTRUCTION BONDS. Upon execution of the Contract and prior to commencement of construction, unless otherwise approved by AHP or DHCS each in their sole discretion, Contractor must obtain a labor and material (payment) bond and a performance bond, or a dual bond which covers both payment and performance obligations, with respect to the construction of the Project in a penal sum each of not less than one hundred percent (100%) of the scheduled cost of construction. Such bonds must be issued by a company which is authorized to transact surety insurance in California and which has assets exceeding its liabilities in an amount equal to or in excess of the bond amount. The bonds must name AHP and DHCS as co-obligees. Owner shall provide to AHP a copy of any and all such payment and performance bonds prior to commencement of the construction work required to be performed under the Contract.

6. CONTRACT WORK. Contractor warrants and represents that it is licensed or otherwise authorized to perform the construction work specified in the Contract in the State of California. All construction work must be performed by persons or entities licensed or otherwise authorized to perform the applicable construction work in the State of California. Contractor shall insert similar provisions in all subcontracts for work for the Project.

7. QUALITY OF WORK. Contractor must construct the Project in conformance with the plans and specifications and any modifications thereto approved by AHP. Contractor must construct the Project according to general industry standards and shall employ building materials of a quality suitable for the requirements of the Project and conforming to general industry standards. Contractor must construct the Project in full conformance with applicable local, state, and federal statutes, regulations, and building and housing codes.

The parties acknowledge that AHP and DHCS are under no duty to review the Plans and Specifications or to inspect construction of the Project. Any review or inspection undertaken by AHP or

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DHCS of the Project is solely for the purpose of determining whether Owner and Contractor are properly discharging their obligations, and should not be relied upon by Owner, Contractor, or any third parties as a warranty or representation by AHP or DHCS as to the quality of the design or construction of the Project.

8. ADDITIONS OR CHANGES IN WORK. AHP must be notified, no later than thirty (30) days after the execution of a change order by and between Owner and Contractor, of any changes in the work required to be performed under the Contract or this Addendum, including any substantial additions, changes, or deletions to the approved plans and specifications, which exceeds One Hundred Thousand Dollars ($100,000). Contractor shall not allow subcontractors to mark-up any change order by more than fifteen percent (15%). Contractor shall provide AHP and Owner with an updated budget and schedule prior to the commencement of construction at the Project and at fifty percent (50%) completion of the Project showing all changes from the budget and schedule prepared prior to the issuance of the notice to proceed to Contractor.

9. SITE INSPECTIONS. Contractor shall permit and facilitate in person and remote observation and inspection of work at the job site by AHP and DHCS and their agents and by public authorities during reasonable business hours.

10. AUDITS. Contractor must make available for examination at reasonable intervals and during normal business hours to AHP and DHCS’s representatives all books, accounts, reports, files, and other papers or property with respect to all matters covered by the Contract and this Addendum, and must permit these representatives to audit, examine, and make copies, excerpts, or transcripts from such records.

11. NONDISCRIMINATION. Contractor may not discriminate against any employee or applicant for employment on the basis of race, color, religion, sex, sexual preference, national origin, AIDS or AIDS-related conditions, or disability in any phase of employment during construction.

Contractor agrees to post in conspicuous places, available to all employees and applicants for employment, notices to be provided setting forth the provisions of this nondiscrimination clause.

12. PREVAILING WAGES. All workers performing construction work for the Project employed by Contractor and by any of its subcontractors must be compensated in an amount no less than the general prevailing rate of per diem wages as determined by the California Department of Industrial Relations under California Labor Code section 1770 et seq. and implementing rules and regulations.

Contractor must comply with, and must ensure that its subcontractors comply with, all reporting and recordkeeping requirements of the applicable prevailing wage statutes and regulations.

In the event of underpayment of wages by Contractor or by any subcontractor employed on the Project, AHP, in addition to other rights and remedies afforded by this Agreement, may: (1) demand that any underpaying employer comply with these requirements; (2) demand that the underpaying employer pay the difference between the prevailing wage rate and the amount actually paid to workers; (3) withhold and/or pay any Program Funds as necessary to compensate workers the full wages required under this Agreement; and/or (4) pursue any lawful administrative or court remedy to enforce these requirements against the underpaying employer. Any underpaying employer shall comply with a demand to pay any amounts due under this section within ten (10) calendar days of the demand.

Contractor must include the prevailing wage requirement in all subcontracts for work on this Project and must specify that AHP and DHCS are intended third-party beneficiaries of such provisions.

Contractor must take reasonable measures to monitor and enforce the prevailing wage requirements

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imposed on its subcontractors, including withholding payments to those subcontractors who violate these requirements. In the event that Contractor fails to take the above measures, Contractor shall be liable for the full amount of any underpayment of wages, plus costs and attorneys’ fees, as if Contractor was the actual employer.

13. INSURANCE COVERAGE. Contractor must have in full force and effect during the complete course of construction of the Project, insurance, providing coverage in the types and amounts set forth below:

13.1 Workers’ compensation insurance as required by the State of California.

13.2 Comprehensive automobile and vehicle liability insurance covering claims for injuries to members of the public and/or damages to property of others arising from use of motor vehicles, including on-site and off-site operations, and owned, non-owned, or hired vehicles, with One Million Dollars ($1,000,000) combined single limits.

13.3 Commercial general liability insurance of not less than One Million Dollars ($1,000,000) per occurrence with an annual aggregate limit of Five Million Dollars ($5,000,000) for bodily injury and property damage liability combined. Such insurance can be provided pursuant to a combination of a commercial general liability insurance policy and an umbrella policy. The commercial general liability insurance policy shall cover liabilities arising out of premises, operations, independent contractors, products, completed operations, personal and advertising injury, and liability assumed under an insured agreement. The commercial general liability insurance shall apply to each insured against whom claim is made or suit is brought subject to the Sponsor’s limit of liability.

14. NON-LIABILITY OF OFFICIALS, EMPLOYEES, AND AGENTS. No director, officer, official, employee, consultant, or agent of AHP or DHCS shall be personally liable to Contractor for any obligation created under the terms of the Contract or this Addendum except in the case of actual fraud or willful misconduct by such person.

15. INDEMNITY. Notwithstanding the insurance requirements herein, Contractor hereby indemnifies, defends, and holds AHP, DHCS, and their respective directors, officers, officials, employees, consultants, and agents (collectively, the “Indemnified Parties”), harmless against any losses, damages, liabilities, claims, demands, judgments, actions, court costs, and legal or other expenses (including reasonable attorneys’ fees) which an Indemnified Party may incur as consequence of Contractor’s failure to perform any obligations as and when required by the Contract or this Addendum, any act or omission by Contractor or its subcontractors with respect to the Project, or any failure of any of Contractor’s representations or warranties to be true and complete, except to the extent such losses are caused by the negligence or willful misconduct of the Indemnified Party. Contractor shall pay immediately upon the Indemnified Party’s demand any amounts owing under this indemnity. The duty of Contractor to indemnify includes the duty to defend the Indemnified Party in any court action, administrative action, or other proceeding brought by any third party arising from the Project or the Contract or this Addendum.

Contractor’s duty to indemnify the Indemnified Party shall survive the term of the Contract.

16. HAZARDOUS MATERIALS. Neither Contractor nor any of its subcontractors may use the real property upon which the Project is to be constructed (the “Project Property”) or allow the Project Property to be used for the generation, manufacture, storage, disposal, or release of Hazardous Materials.

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Contractor shall immediately notify AHP and Owner in writing of: (a) the discovery of any concentration or amount of Hazardous Materials on or under the Project Property requiring notice to be given to any governmental agency under Hazardous Materials Laws; (b) any knowledge by Contractor that the Project Property does not comply with any Hazardous Materials Laws; (c) the receipt by Contractor of written notice of any Hazardous Materials claims; and (d) the discovery by Contractor of any occurrence or condition on the Project Property or on any real property located within 2,000 feet of the Project Property that could cause the Project Property to be designated as a “hazardous waste property.”

17. NOTICES; NOTICE OF DEFAULT TO AHP. If at any time after the execution of the Contract it shall become necessary or convenient for Contractor to serve any notice, demand, or communication upon AHP, such notice, demand or communication shall be in writing provided in accordance with the notice requirements of the Agreement. Contractor shall give AHP prior or concurrent written notice of any default or breach claimed by Contractor against Owner or any other party under the Contract. The notice shall describe the default and give AHP the option to cure said default within thirty (30) calendar days. No termination of the Contract by Contractor shall be binding unless AHP has been given the required notice and has not cured the default within thirty (30) calendar days.

18. REMEDIES. The parties hereto agree that AHP, while not a party to the Contract, is an intended third-party beneficiary of the obligations imposed on Contractor in this Addendum. In the event of any breach or violation of any agreement or obligation of Contractor under the Contract or this Addendum, AHP may proceed with any of the following remedies:

18.1 Bring an action in equitable relief seeking the specific performance by Contractor of the terms and conditions of the Contract or this Addendum and/or enjoining, abating, or preventing any violation of said terms and conditions;

18.2 Order immediate stoppage of construction and demand that any condition leading to the default be corrected before construction may continue;

18.3 Enter the Project Property and take any actions necessary in its judgment to complete construction of the Project as permitted under the assignment of development rights;

18.4 Suspend disbursement of Program Funds for the Project until the breach or violation is corrected, or, if Owner had any concurrent obligation to perform on or ensure performance on the breached obligation, cancel the Program Funds commitment made to Owner and terminate AHP’s obligation to disburse Program Funds to Owner;

18.5 Terminate the Contract; or

18.6 Pursue any other remedy allowed in law or equity.

19. GOVERNING LAW. This Addendum shall be interpreted under and be governed by the laws of the State of California, except for those provisions relating to choice of law and those provisions preempted by federal law.

20. DEFINITIONS. Capitalized terms not defined in this Addendum shall have the same meaning as defined in the Agreement.

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21. ATTORNEYS’ FEES AND COSTS. In the event any legal action is commenced to interpret or to enforce the terms of this Addendum, the prevailing party in any such action shall be entitled to recover all reasonable attorneys’ fees and costs incurred in such action.

22. TIME. Time is of the essence in the performance of this Addendum by Contractor.

23. CONSENTS AND APPROVALS. Any consent or approval required under this Addendum shall not be unreasonably withheld, delayed, or conditioned.

24. BINDING UPON SUCCESSORS. All provisions of this Addendum shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors-in-interest, transferees, and assigns of each of the parties; provided, however, that this section does not waive the prohibition on assignment of this Addendum by Contractor without AHP’s consent.

25. RELATIONSHIP OF CONTRACTOR AND AHP. Contractor understands that neither AHP nor DHCS undertakes or assumes any responsibility or duty to Contractor or to any third party. The relationship of Contractor and AHP and DHCS for this Project shall not be construed as a joint venture, equity venture, or partnership. AHP shall have no obligation to any party under the Contract but is an intended third-party beneficiary of the obligations under this Addendum. Contractor shall have no authority to act as an agent of AHP or DHCS or to bind AHP or DHCS to any obligation.

26. ASSIGNMENT. Contractor may not assign any of its interests under the Contract or the Addendum to any other party, except with the prior written consent of AHP. Any unauthorized assignment shall be void.

27. AMENDMENTS AND MODIFICATIONS. Any amendments or modifications to this Addendum must be in writing and shall be made only if executed by Owner and Contractor and consented to in writing by AHP.

28. SEVERABILITY. Every provision of this Addendum is intended to be severable. If any provision of this Addendum is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be affected or impaired.

29. ADDENDUM CONTROLS. In the event that any provisions of this Addendum and the Contract conflict, the terms of this Addendum shall control.

SIGNATURES ON THE FOLLOWING PAGE

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IN WITNESS WHEREOF, Owner and Contractor have executed this Construction Contract Addendum as of the date first written above.

OWNER:

By:

Name:

Title:

Date:

CONTRACTOR:

By:

Name:

Title:

Date:

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California Department of Health Care
Services Proposition 1:

Behavioral Health Infrastructure
Bond Act of 2024:

Behavioral Health Continuum
Infrastructure Program
Round 1 (2024): Launch Ready
Request for Applications

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PART ONE: OVERVIEW ...............................................................................................................................................3

1.1. INTRODUCTION TO THE GRANT OPPORTUNITY AND STATE PRIORITIES.......................................................................................3

1.2. PURPOSE .....................................................................................................................................................................3

1.3. BHCIP TO DATE ..................................................................................................................................................................................................4

1.4. TIMELINE .....................................................................................................................................................................5

1.5. TOTALGRANT AMOUNTS................................................................................................................................................5 PART TWO: PROJECT REQUIREMENTS ........................................................................................................................5

2.1. ELIGIBILITY REQUIREMENTS .............................................................................................................................................5

2.2. ELIGIBILITY CONSIDERATIONS ...........................................................................................................................................9

2.3. SITE IDENTIFICATION AND FEASIBILITY ANALYSIS.................................................................................................................10

2.4. ELIGIBLE FACILITY TYPES................................................................................................................................................11

2.5. POST-AWARD EXPECTATIONS.........................................................................................................................................12

2.6. ENCUMBRANCE AND USE RESTRICTIONS...........................................................................................................................12

2.7. MATCH REQUIREMENTS................................................................................................................................................13

2.8.DEVELOPMENT BUDGET................................................................................................................................................15

2.9. ACCESSIBILITY AND NONDISCRIMINATION .........................................................................................................................16

2.10. STATE PREVAILING WAGE ...........................................................................................................................................17

2.11. STREAMLINED, MINISTERIAL REVIEW PROCESS ................................................................................................................17

2.12. CALIFORNIA ENVIRONMENTALQUALITY ACT (CEQA).......................................................................................................18

2.13. LOW-RENTHOUSING PROJECT EXEMPTION ....................................................................................................................18 PART THREE: APPLICATION PROCESS AND SUBMISSION ...........................................................................................19

3.1. APPLICATION PROCESS .................................................................................................................................................19

3.2. PRE-APPLICATION CONSULTATIONS AND TECHNICAL ASSISTANCE ..........................................................................................22 PART FOUR: AWARD SCORING AND PROCESS...........................................................................................................22

4.1. APPLICATION SCORING CRITERIA.....................................................................................................................................22

4.2. AWARD PROCESS.........................................................................................................................................................23

4.3. APPEALS ....................................................................................................................................................................24 PART FIVE: PROJECT OPERATIONS ............................................................................................................................24

5.1. PROJECT OVERSIGHT AND REPORTING .............................................................................................................................24

5.2.DISBURSEMENT OF GRANT FUNDS ..................................................................................................................................25

5.3. FUNDING PROMOTION .................................................................................................................................................26 PART SIX: FORMS/ATTACHMENTS (TOTAL OF 15) .....................................................................................................26

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Part One: Overview

1.1. Introduction to the Grant Opportunity and State
Priorities
The California Department of Health Care Services (DHCS) launched the Behavioral Health Continuum Infrastructure Program (BHCIP) to address historic gaps in the behavioral health care continuum and meet the growing demand for services and support across the life span of vulnerable individuals in need. This Request for Applications (RFA) reflects the addition of the Behavioral Health Infrastructure Bond Act of 2024 (BHIBA).

The State priorities for BHCIP are:
• Address urgent needs in the care continuum for people with mental health or substance use conditions, including unhoused people, veterans, older adults, adults with disabilities, and children and youth.
• Invest in behavioral health and community care options that advance health equity of behavioral health care and community options.
• Increase options across the life span that serve as an alternative to incarceration, hospitalization, homelessness, and institutionalization. • Meet the needs of vulnerable populations with the greatest barriers to access, including people experiencing unsheltered homelessness and justice involvement. • Ensure care can be provided in the least restrictive settings to support community integration, choice, and autonomy.
• Leverage county and Medi-Cal investments to support ongoing sustainability. • Leverage the historic state investments in housing and homelessness.

In addition, DHCS is prioritizing regional models or collaborative partnerships, including publicprivate partnerships, aimed at constructing, renovating, and/or expanding community-based services, as well as projects using a campus-type model that collocate multiple levels of care on the continuum, with a focus on residential treatment facilities.

1.2. Purpose
In March 2024, California voters passed Proposition 1, which includes the Behavioral Health Services Act (Senate Bill 326) and the Behavioral Health Infrastructure Bond Act (BHIBA) of 2024 (Assembly Bill 531), authorizing DHCS to make additional BHCIP grant funding available to eligible entities. The BHIBA is a $6.38 billion general obligation bond to develop a wide range of behavioral health treatment, residential care settings, and supportive housing to help provide appropriate care facilities for Californians experiencing mental health conditions and substance use disorders. Of the total bond amount, DHCS is authorized to award up to $4.4 billion “to construct, acquire, and rehabilitate real estate assets or to invest in needed infrastructure to expand the continuum of behavioral health treatment resources to build new capacity or expand existing capacity for shortterm crisis stabilization, acute and subacute care, crisis residential, community-based mental

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health residential, substance use disorder residential, peer respite, community and outpatient behavioral health services, and other clinically enriched longer term treatment and rehabilitation options for persons with behavioral health disorders in the least restrictive and least costly setting.”1 Of these funds, $1.5 billion of competitive grant funding will be exclusively available to cities, counties, city and counties, and tribal entities and $30 million will be specifically designated to tribal entities. The balance of the funds, up to $2.893 billion, is available to cities, counties, tribal entities, and nonprofit and for-profit organizations. The BHCIP portion of the bond is estimated to fund 6,800 residential treatment beds and provide behavioral health outpatient treatment for 26,700 slots and will build on other major behavioral health initiatives in California. The Department of Housing and Community Development (HCD) will oversee the remaining BHIBA available funding—up to $2 billion in total. There will be a separate Notice of Funding Availability for that portion of the BHIBA.

1.3. BHCIP to Date
DHCS was authorized through 2021 legislation to establish BHCIP and award grant funding to construct, acquire, and expand properties and invest in mobile crisis infrastructure related to behavioral health. DHCS has been releasing these funds through multiple grant rounds targeting various gaps in the state’s behavioral health facility infrastructure. Forty-nine counties have been awarded BHCIP funding through Round 1 to Round 5.

BHCIP funding rounds:
• Round 1: Crisis Care Mobile Units, $205 million ($55 million Substance Abuse and Mental Health Services Administration grant funding)
• Round 2: County and Tribal Planning Grants, $16 million • Round 3: Launch Ready, $518.5 million
• Round 4: Children and Youth, $480.5 million
• Round 5: Crisis and Behavioral Health Continuum, $430 million BHCIP funding has allowed eligible entities in all regions of the state to develop an unparalleled array of new and expanded behavioral health treatment facilities for residential/inpatient and outpatient care. However, inequities across the health care system remain seen in California.

Statewide, a 6,000-plus behavioral health bed shortfall is contributing to the unmet need among people experiencing homelessness who have mental illness and/or substance use disorders.2 1 AB-531. The Behavioral Health Infrastructure Bond Act of 2023. 2 BHSA Fact Sheet (ca.gov).

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1.4. Timeline
Table 1. Timeline for Bond BHCIP Round 1: Launch Ready
Request for Applications (RFA) release July 17, 2024
Pre-recorded enhanced technical assistance
presentations
Available beginning May 2024 BHCIP website
Application portal opens August 9, 2024
Informational webinar—please register here August 7, 2024; 1–2 p.m. Pacific Time (PT) Tribal informational webinar— please register here August 8, 2024; 2–3 p.m. PT Pre-Application Consultation (PAC) registration
opens (accessible here)
Deadline to schedule a required PAC
PAC window period
July 18, 2024
October 15, 2024
August 9, 2024, through November 14, 2024
Office Hours (Recommend PAC to be completed)
Wednesdays and Thursdays, 10-11 a.m. PT
(ends December 13, 2024)
Application due date December 13, 2024, at 5 p.m. PT (no exceptions) Award announcements May 2025 (anticipated)

1.5. Total Grant Amounts
Bond BHCIP Round 1: Launch Ready: Up to of $3.3 billion will be available to construct, acquire, and rehabilitate real estate assets to expand the continuum of behavioral health treatment and service resources for Californians (see section 2.4) in this round of Bond BHCIP funding. Of that amount, $1.47 billion is designated for cities and counties; another $30 million is designated for tribal entities. The remaining $1.8 billion is available to all eligible entities, including cities, counties, and tribal entities. Bond BHCIP Round 1: Launch Ready funds are not intended to preserve existing service capacity. Bond BHCIP Round 1: Launch Ready grantees must commit to serving Medi-Cal beneficiaries.

For purposes of Bond BHCIP Round 1: Launch Ready funding, a project is defined as “launch ready” when some essential predevelopment design, planning, site control, and budgeting details have been professionally formalized; the project meets the minimum threshold requirements as listed in section 2.1 (“Project Readiness”); and construction for the requested project is not currently underway.

Part Two: Project Requirements

2.1. Eligibility Requirements

1. Pre-Application Consultation

2. Eligible Applicants

3. Medi-Cal Services

4. Licensing, Certification, and Accreditation

5. Project Readiness

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6. Building Use Restriction

7. Community Needs and Support
Pre-Application Consultation
All prospective applicants will be required to engage in a pre-application consultation (PAC) with Advocates for Human Potential, Inc. (AHP), the BHCIP administrative entity, to discuss their potential project and application (see section 3.2).

Eligible Applicants
Counties, cities, tribal entities (“tribal entity” shall mean a federally recognized Indian tribe, tribal organization, or urban Indian organization, as defined in Section 1603 of Title 25 of the United States Code), nonprofit organizations, and for-profit organizations whose projects reflect the State priorities and align with facility types listed in Table 2 are eligible to apply for this funding, noting the following stipulations:
• Projects must make a commitment to serve Medi-Cal beneficiaries. • Recipients of BHCIP awards in prior rounds are eligible to apply. Any additional Bond BHCIP funding awarded must be used to further expand or create new facility capacity. To be considered, applications must clearly explain the funding request for additional behavioral health project expansion and how it meets the statewide continuum of care.

Bond BHCIP funding will not fund budget shortfalls or cost overruns for any previously awarded BHCIP projects.
• For joint applications, all co-applicants must be named in the grant application and must submit letters of commitment that are included with the application. • For-profit organizations with no prior behavioral health experience must apply with a partner, such as a nonprofit organization, tribal entity, city, or county, with the requirement that the partner organization have relevant experience with the target population reflected in the successful development, ownership, or operation of a comparable project. A memorandum of understanding (MOU) or other agreement with the nonprofit organization, tribal entity, city, or county to confirm the organization’s role in the project, including that they are working on behalf of the service provider, is also required.

Medi-Cal Services
Applicants must describe the payor mix that will pay for and sustain behavioral health services once project construction is complete. Examples of payors include private health insurance, MediCal, private pay, grants, and county funds. Applicants must provide a description of their contingency plan for funding any potential cost coverage beyond the grant award.

Awarded applicants that offer Medi-Cal behavioral health services will be expected to have a contract in place with their county to ensure the provision of Medi-Cal services once the funded facility’s expansion or construction is complete. Community wellness centers and youth behavioral

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health prevention centers, which are only eligible facility types for tribal entities, do not provide Medi-Cal reimbursable behavioral health treatment services and thus are not required to have a contract to provide Medi-Cal behavioral health services; however, they must provide services to Medi-Cal beneficiaries and describe how their services will be sustainably funded.

Licensing, Certification, and Accreditation
Applicants must also indicate the applicable behavioral health licensing, certifications, and accreditations required to operate their Bond BHCIP-funded program by the State and/or at the local level. Applicants with facilities that do not require licenses or certifications, such as community wellness centers, need to indicate this in their application. Tribal entities that are exempt from state licensing and/or requirements must describe the basis for their exemption and their plan for meeting programmatic requirements. As part of the technical assistance (TA) that will be made available, applicants may receive information and guidance about the licensure and certification process and timelines for application submission.

Project Readiness
To be eligible for Bond BHCIP Round 1: Launch Ready funding, a project must demonstrate “project readiness.” At a minimum, the fundamental threshold requirements for “project readiness” are as follows (items noted with an asterisk must be submitted with the application):
• Site control.* Any one of the following must be used to prove site control (other documentation demonstrating site control may be submitted for DHCS consideration):
o Title vested to applicant demonstrated with current title report (ownership). o Executed purchase and sale agreement (PSA).
o Mutually executed Letter of Intent (LOI).
o Preexisting long-term lease (acceptance of a Bond BHCIP award will require a lease extension of no fewer than 30 years).
o Executed exclusive negotiation agreement (ENA).
o Note: An MOU does not constitute site control. Please be sure to discuss any other proposed site control documentation during your required pre-application consultation (PAC).
• A preliminary title report.*
• A sustainable business plan* (pro forma) with five-year projections (Form 9) within existing available funding (income and expenses) of future objectives and strategies for achieving them.
• A conceptual/schematic site plan* with a forecast of the developmental potential of the property. The closer the construction drawings are toward “permit ready,” the higher the application will be scored, all other items being equal.

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• Stakeholder support* as demonstrated by letters of support from internal boards of directors, tribal councils or advisory boards, and professional/community partners, as relevant. City, nonprofit, or for-profit applicants must also include a letter of support from their county behavioral health agency.
• Demonstration of county and Medi-Cal investments to support ongoing sustainability. • Match amount and source identified in Budget (Form 2). • Board Authorizing Resolution (BAR)* to confirm signing authority for the contract.

Eligible entities may use the BAR template provided (Form 10). Local government entities can use their specific authorizing resolution document.

Building Use Restriction
A commitment to the provision of behavioral health services and building use restriction for a 30- year period through a deed restriction placed on the property title is required (see section 2.6).

After a conditional award is issued to an applicant, the 30-year encumbrance period must officially be approved by the applicant’s board (and property owner, if applicant is a lessee), as indicated through the submission of an official BAR.

Community Needs and Support
All applicants must describe the local needs based on the “Assessing the Continuum of Care for Behavioral Health Services in California” report and any local needs assessments used to justify the proposed expansion. All applicants will be required to demonstrate how the proposed project will advance equity. Projects will be required to certify that they will not exclude certain populations outside their mission or scope, such as those who are justice-involved or children and youth in foster care.

Organizational support and community engagement, including the active involvement of applicable stakeholders in the project design, are required. Insights from the community must be included in project planning, design, implementation, and evaluation. All applicants must complete application Form 7: Community Engagement and provide any relevant letters of support for the project. All letters must be signed and dated no more than six months before the date of application submission.

At the time of application, city, nonprofit, or for-profit applicants must also include a letter of support from their county behavioral health agency or, if a tribal entity, the tribal board. The letter must indicate that applicants providing Medi-Cal behavioral health services will have in place a contract with their county to ensure the provision of Medi-Cal services once the financed facility’s expansion or construction is complete. Bond BHCIP grant awards do not guarantee county contracts.

All applicants governed by a CEO or board must submit a letter of support from the CEO or board.

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2.2. Eligibility Considerations
All applicants must demonstrate how their infrastructure project will expand community-based facility capacity exclusively for behavioral health services in the continuum of care. Regional models or collaborative partnerships aimed at construction, renovation, and/or expansion of community-based services are eligible, as are projects using a campus-type model that collocates multiple levels of care on the continuum are strongly encouraged. Regional model is defined as two or more entities partnering to create established networks of organized systems of care. In addition, scoring will take into consideration a focus on the State’s priorities, including efforts to advance equity and to expand services in regions and counties that currently do not have an adequate number of treatment options for behavioral health facilities. In an effort to be consistent with the bond proposal to expand 6,800 residential treatment beds, applicants proposing residential facilities will be prioritized for funding award. Expanded residential treatment beds will also assist counties with the implementation of the Community Assistance, Recovery and Empowerment (CARE) Act.

All applicants must describe the local needs based on the statewide needs assessment report and any local needs assessment used to justify the proposed expansion. All applicants will be required to demonstrate how the proposed project will advance equity. Projects will be required to certify that they will not exclude certain populations outside their mission or scope, such as those who are justice-involved or children and youth in foster care. Grantees with behavioral health facilities that offer Medi-Cal behavioral health services will be required to have a contract in place with their county to ensure the provision of Medi-Cal services once the funded facility’s expansion or construction is complete.

In addition, inclusion of a professionally bid development budget, including all local prevailing wage rates, one for each phase, and a total budget for acquisition and construction, will increase an applicant’s score. However, it will not guarantee an award.

Three phases of project development will be considered during the evaluation of each application.

Applicants must be in one of the three phases; applicants in later phases will be scored higher. All projects must meet the minimum threshold of project readiness to be awarded grant funds.

Applicant projects are considered to be in a given phase of development only after they have met all of the requirements in the previous phase. Required documentation will be reviewed with each applicant during the PAC process and must be submitted as part of the application.

Funding is intended for planning, preconstruction, permitting, and construction; allowable costs include those activities identified in the development phases below. • Phase 1: Planning and predevelopment
o Development team established; includes attorney, architect, and/or design-build team.

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o Site control, defined as ownership, an executed PSA, an executed LOI, a long-term lease, or an executed ENA (see section 2.1).
o Basic schematic design site plan, with basis of design; includes architectural and engineering narratives.
o Property-specific site investigation report and due diligence. o Budget with cost estimates based on site plan/drawings. • Phase 2: Design development
o Site control, defined as ownership, an executed PSA, an executed LOI, a long-term lease, or an executed ENA (see section 2.1).
o Site plan established with a schematic plan with architectural and engineering specifications, including architectural design drawings. o Stakeholder support established as demonstrated by a letter from city/county/board of directors/tribal entity.
o Able to gain building permits within six months of funding. o Able to close on land and gain building permits within six months of funding. o Able to start construction within nine months of funding. • Phase 3: Shovel ready
o Ownership of real estate site.
o Preliminary plan check completed, with comments received. o Construction drawings completed or near completion.
o General contractor (builder) selected and ready for hire. o Ninety percent of construction drawings ready for submission for building permit. o Building permit ready for issue.
o Able to start construction within 60 days or less.
• Final Phase: Construction
o Projects that rehabilitate or renovate an existing facility are allowable as long as they result in an expansion of behavioral health services for the target population.

Full funding of a proposed development project will be contingent on completion of all three phases of development planning. The planning and predevelopment phase, which includes the submission of construction documents for building permit review, must be completed within six months of grant funding award.

2.3. Site Identification and Feasibility Analysis
Applicants will be expected to develop a competitive and itemized professional budget for all development costs, including legal, insurance, permits and fees, and performance and payment bonds, which will be scored alongside applications for projects of similar setting types and sizes.

DHCS, AHP, and AHP’s subcontractors will conduct a financial viability assessment (as demonstrated through a five-year pro forma business plan) (Form 9), considering continued fluctuations in construction and other costs. Through various TA activities, such as the PAC and

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financial document review, the State will assess long-term operational sustainability once the capital project is complete and in use for its intended purpose.

2.4. Eligible Facility Types
The following facility types may be considered for project funding only if they are expanding behavioral health infrastructure.

Table 2. Eligible Facility Types
Bond BHCIP Round 1: Launch Ready Eligible Facility Types Acute Psychiatric Hospital
Adolescent Residential Substance Use Disorder (SUD) Treatment Facility Adult Residential SUD Treatment Facility
Behavioral Health Urgent Care (BHUC)/Mental Health Urgent Care (MHUC)* Chemical Dependency Recovery Hospital
Children’s Crisis Residential Program (CCRP)
Community Mental Health Clinic (outpatient)
Community Residential Treatment System (CRTS)/Social Rehabilitation Program (SRP) Community Treatment Facility (CTF)
Community Wellness/Prevention Center (tribal entities only) Crisis Stabilization Unit (CSU)
General Acute Care Hospital (GACH) for behavioral health services only Hospital-Based Outpatient Treatment (outpatient detoxification/withdrawal management) Mental Health Rehabilitation Center (MHRC)
Narcotic Treatment Program (NTP)
NTP Medication Unit
Office-Based Opioid Treatment (OBOT)
Outpatient Treatment for SUD
Partial Hospitalization Program
Peer Respite
Perinatal Residential SUD Facility
Psychiatric Health Facility (PHF)
Psychiatric Residential Treatment Facility (PRTF)
Short-Term Residential Therapeutic Program (STRTP)
Skilled Nursing Facility with Special Treatment Program (SNF/STP) Sobering Center (funded under the Drug Medi-Cal Organized Delivery System [DMC-ODS] and/or Community Supports)
Social Rehabilitation Facility (SRF)
*For purposes of this funding, a BHUC facility, also known as MHUC, is a walk-in center with voluntary stabilization-oriented services specific to individuals experiencing behavioral health or mental health crisis for less than 24 hours. This community-based option is typically designed to

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provide an alternative to emergency department visits for urgent medical needs. BHUCs/MHUCs must focus on serving individuals in need of crisis services, commit to serving Medi-Cal beneficiaries, and offer some or all of the following:
• Multidisciplinary health assessment
• Psychiatric evaluation, diagnosis, and treatment
• Crisis stabilization and intervention, mental health counseling, and medication evaluation • Direct referrals for treatment of care
• Linkage to community-based solutions
• Peer support
Facility types that are not eligible for funding:
• Correctional settings
• Schools
Applicants will be expected to define the types of facilities they will operate and explain how they will expand service capacity exclusively for community-based behavioral health facilities. Regional models, collaborative partnerships, and public-private partnerships are strongly encouraged.

2.5. Post-Award Expectations
Grantees must commit to executing Bond BHCIP contracts within 90 days of receipt of conditional award notice. Failure to fully execute contracts within the required time frame may result in the rescinding of Bond BHCIP funding awards. DHCS will not accept any changes to Bond BHCIP contracts.

Grantees must have a financial management system to track and project funding usage and perform any required data reporting. Bond payment processes and funding cycle will be subject to bond funding requirements. Additional guidance and TA will be provided to grantees in order to comply with bond requirements.

Awarded grant funding for Bond BHCIP Round 1: Launch Ready must be fully expended within five years of receipt of conditional award notice.

2.6. Encumbrance and Use Restrictions
In accordance with section 5960.15 of the California Welfare and Institutions Code (WIC), applicants will be required to commit to operating services in the financed facility for the intended purpose for a minimum of 30 years within existing funding for behavioral health services. Bond BHCIP funding may not be used to fund services. The approved building use restriction will be detailed in the Bond BHCIP contract.

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2.7. Match Requirements
Mandatory match guidelines are required by statute and will be set according to applicant type.

Cash match must be deposited into the project bank account (see section 5.2).

Project Funding Awarded Local Government and
Nonprofit Organization
For-Profit Organization
under $150 million 10 percent 25 percent
10 percent 25 percent
above $150 million Higher priority for applicants that include a higher local match Tribal entities (regardless of funding awarded) = 5 percent match.

For-profit organizations that have no prior behavioral health experience are required to partner and apply with an experienced service provider in order to leverage their partner’s behavioral health experience. The partner’s entity type will determine the percentage that will be used to calculate the match requirement. The match requirement will be based on the partner with the lowest match amount.

For-profit applicants with prior experience and no partnerships will be required to pledge a 25 percent match.

The match amount will be calculated using the following formula:
(total project award request - total calculated budget contingencies) x required match percentage Types of Eligible Match Sources
Applicants must document the match source being pledged for the project. Three types of sources are eligible to satisfy the match requirement: (1) cash, (2) in-kind property, and (3) sunk costs (i.e., capital expenses already incurred on the project). All match sources must be approved by DHCS. a. Cash
Cash is the strongest form of match and can come from a variety of sources, depending on the applicant. Applicants must document their ability to pledge the required match in cash, including providing bank statements and investment statements showing available cash on hand. Applicants seeking to pledge public or private grant funds must document the funds are eligible for use on the proposed project. Cash sources for the delivery of services are not an eligible source of cash match. The list below provides additional examples of eligible cash sources:

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• Local funding
• Mental Health Services Act (MHSA) funds from Community Services and Supports and Capital Facilities and Technological Needs (CFTN) components • Behavioral Health Services Act (BHSA) funds from the Behavioral Health Services and Supports
• Foundation/philanthropic support
• Opioid settlement funds for SUD facilities
• Loans or investments
• Incentive payments from managed care plans; or
• Another source.
b. In-Kind Property Equity
Applicants may pledge the in-kind equity value of property if the property being pledged is the actual property where the facility will be located and the entire assessor’s parcel number (APN) of the property being pledged for match is dedicated to the new development project. Only the equity value of the APNs that will be encumbered by the 30-year encumbrance restriction can count as an in-kind property match source and must be validated by a certified appraisal of the specific APN.

In order to document the equity value of the pledged property, applicants must submit a certified appraisal dated within five years of the date of application. The certified appraisal must only give a value for the specific APN to be encumbered. The equity value of the property will be used to determine if the applicant can meet the match requirement.

If the applicant has an outstanding mortgage on the property that it pays on a regular basis, it must submit a copy of the most recent mortgage statement, including the outstanding mortgage value.

The outstanding mortgage amount will be subtracted from the certified appraisal to determine the equity value:
certified appraisal value − outstanding loan amount = equity value If an applicant has purchased the property outright and has clear title in hand, the applicant must submit either the grant deed or the payoff letter to indicate there is nothing outstanding that would reduce the equity value. Property valuations will be approved at the discretion of DHCS. c. Sunk Costs
To satisfy the match requirement, DHCS may approve on a case-by-case basis sunk costs directly related to the development project. Sunk costs may be established with documentation of paid invoices including date and address of service and proof of payment (e.g., cancelled checks, online bank records, invoices) for professional services related to predevelopment of the proposed Bond BHCIP project. Eligible sunk costs may include the purchase of real property and

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construction or renovation/rehabilitation costs, including project planning or project management; appraisals; inspections; preconstruction costs such as permitting, surveying, architectural, and engineering fees; hardscaping and/or landscaping costs essential to the completion of the project (may not exceed 5 percent of the total grant award); and furniture, fixtures, and equipment (FFE).

A property that has been purchased at any time before execution of the Program Funding Agreement (PFA, or contract) can be contributed as a sunk cost, so long as it has undergone an appraisal within the past five years.

No sunk costs exceeding one year prior to the date of the Bond BHCIP Notice of Award may be claimed. Sunk costs must be claimed no later than seven calendar days after the date of the conditional award letter.

All match amounts must be well-documented. Both the amounts and sources will undergo a thorough review by DHCS and AHP prior to the awarding of funds. Cash is the preferred form of match. Services, Behavioral Health Subaccount funding, and State general funds are not permitted sources for match.

2.8. Development Budget
Applicants will be expected to submit a competitive and itemized professional development budget (see application attachment Form 2: Budget Template) with their Bond BHCIP Round 1: Launch Ready application. All development budgets must contain the requested amounts for each phase of funding. Bond BHCIP awards will be based on the application budget; therefore, special attention and care should be made to include all development costs associated with planning, permitting, and construction of a “public works” prevailing wage job. Applicants that have a current Negotiated Indirect Cost Rate Agreement (NICRA) established with a federal cognizant agency responsible for reviewing, negotiating, and approving cost allocation plans or indirect cost proposals may use the current NICRA as the basis for indirect costs. Alternatively, if the applicant does not have a current NICRA, the applicant may elect to use a rate of 10 percent of the modified total direct costs pursuant to 2 CFR 200.414(f).

Applicants should include all anticipated costs for the planning, permitting, and construction of their project, including prevailing wage rates for all onsite work, for an anticipated construction start in 2025-2026. Budgets should include all costs for insurance (including builder’s risk, workers’ compensation, commercial auto, general liability, and property), along with costs for payment and performance bonds, legal fees, specialty consultants, permits and fees associated with building permits, and potential additional fees, depending on the project and jurisdiction. The PFA details insurance requirements.

Applicants must comply with all Department of Industrial Relations (DIR) regulations related to completing a “public works” project and should only accept qualified construction bids from general

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contractors who are currently registered with the DIR (see section 2.10) and preferably have past public works experience.

Essential FFEs may be allowable costs for permanent property that is attached to the building and/or required for license/certification of the facility, as per the DHCS allowable expense list (Attachment B), with a maximum of 10 percent of the total budget.

Project grantees are responsible for ensuring that their project is on schedule and on budget.

Project grantees that are awarded Bond BHCIP funds will be solely responsible for any costs to complete the project in excess of the Bond BHCIP award amount. Neither DHCS nor AHP will be responsible for any cost overruns.

Applicants must provide a description of their contingency plan for funding any potential cost overages beyond the Bond BHCIP grant award.

2.9. Accessibility and Nondiscrimination
All developments must adhere to the accessibility requirements set forth in California Building Code Chapters 11A and 11B and the Americans with Disabilities Act, Title II. In addition, developments must adhere to either the Uniform Federal Accessibility Standards (UFAS), 24 CFR Part 8, or the U.S. Department of Housing and Urban Development’s (HUD) modified version of the 2010 ADA Standards for Accessible Design (Alternative 2010 ADAS), HUD-2014-0042-0001, 79 FR 29671 (5/27/14) (commonly referred to as “the Alternative Standards” or “HUD Deeming Memo”). Accessible units should, to the maximum extent feasible and subject to reasonable health and safety requirements, be distributed throughout the project and be available in a sufficient range of sizes and amenities consistent with 24 CFR Part 8.26.

Grantees must adopt a written nondiscrimination policy requiring that no person will, on the grounds of race, color, religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national origin, ancestry, familial status, source of income, disability, age, medical condition, genetic information, citizenship, primary language, immigration status (except where explicitly prohibited by federal law), justice system involvement (except where explicitly required by law), or arbitrary characteristics, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under, any project or activity funded in whole or in part with funds made available pursuant to this RFA. Nor will all other classes of individuals protected from discrimination under federal or state fair housing laws, individuals perceived to be a member of any of the preceding classes, or any individual or person associated with any of the preceding classes be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any project or activity funded in whole or in part with funds made available pursuant to this RFA.

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Grantees must comply with the requirements of the Americans with Disabilities Act of 1990, the Fair Housing Amendments Act, the California Fair Employment and Housing Act, the Unruh Civil Rights Act, Government Code section 11135, section 504 of the Rehabilitation Act of 1973, and all regulations promulgated pursuant to those statutes, including 24 CFR Part 100, 24 CFR Part 8, and 28 CFR Part 35.

2.10. State Prevailing Wage
A project funded by a Bond BHCIP grant is a “public works” project if the applicant intends to use the Bond BHCIP funds for the “construction, alteration, demolition, installation, or repair” of a building or structure (Cal. Lab. Code section 1720(a); Cal. Lab. Code section 1750(b)(1)).

Applicants using Bond BHCIP grants to fund public works are subject to California’s prevailing wage and working hours laws (Division 2, Part 7, Chapter 1 of the California Labor Code), and the applicant’s project is subject to compliance monitoring and enforcement by the DIR (Cal. Lab.

Code section 1771.4(a)(1)). Bond BHCIP award recipients must register as the “awarding body” with the DIR within 30 days of execution of the PFA. Further, as detailed in the Bond BHCIP PFA, proof that the general contractor is registered with the DIR will be required before Bond BHCIP funds are disbursed.

Applicants must complete Form 5: Applicant’s Certification of Prevailing Wage as a part of the application process. If DHCS selects an applicant to receive a Bond BHCIP grant and the applicant is using the grant to fund a public works project, then the applicant must submit a Certification of Compliance that includes an attestation from the general contractor certifying that the general contractor will comply with California’s prevailing wage and working hours laws (including posting job notices, as required by Labor Code section 1771(a)(2)). The Certification of Compliance must also state that the general contractor will maintain its labor records in compliance with all applicable state laws (Cal. Lab. Code section 1776) and should make all labor records available to the DIR and any other applicable enforcement agencies upon request (Cal. Lab. Code section 1771.4(a)(3)). The Certification of Compliance must be signed by the general contractor(s) and the applicant.

If DHCS selects an applicant to receive a Bond BHCIP grant and the applicant is not using the grant to fund a public work, then the applicant must submit a Certification of Inapplicability to DHCS explaining why the project is not a public work as defined by California Labor Code section 1720. The Certification of Inapplicability must be signed by the general contractor(s) and the applicant.

2.11. Streamlined, Ministerial Review Process
In accordance with California WIC section 5960.31, if a Bond BHCIP-funded project meets the criteria set forth in paragraph (1) or (2) and complies with subdivisions (b) and (c) of that section,

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then it “shall be a use by right and shall be subject to the streamlined, ministerial review process and filing requirement, pursuant to subdivisions (b) and (d) of Section 50675.1.5 of the Health and Safety Code, and not subject to a conditional use permit, discretionary permit, or to any other discretionary reviews or approvals.”
Applicants must determine if they are subject to the streamlined, ministerial review process due to meeting the requirements set forth in section 5960.31. DHCS nor AHP is responsible for making this determination.

2.12. California Environmental Quality Act (CEQA)
In the event the applicant determines that its Bond BHCIP-funded project is exempt from CEQA, due to being subject to ministerial review (14 C.C.R. §15268(a)) or any other reason, the applicant must file a Notice of Exemption with the appropriate local agency. Additionally, the applicant must provide DHCS, through AHP, with a copy of the filed Notice of Exemption.

If the applicant determines that CEQA applies to its project, the applicant must provide DHCS, through AHP, with copies of all appropriate documentation demonstrating the project’s compliance with CEQA once the applicant has received project approval.

DHCS nor AHP is not responsible for determining whether Bond BHCIP-funded projects are exempt from CEQA. Furthermore, DHCS nor AHP is responsible for filing the Notice of Exemption on behalf of an applicant.

2.13. Low-Rent Housing Project Exemption
In accordance with California WIC section 5960.35(b)(1), a project funded with a BHCIP grant will not be considered a “low-rent housing project,” as defined in section 1 of article XXXIV of the California Constitution, if the project meets any one of the following criteria:

1. The project is privately owned housing, receiving no ad valorem property tax exemption, other than exemptions granted pursuant to subdivision (f) or (g) of section 214 of the Revenue and Taxation Code, not fully reimbursed to all taxing entities, and not more than 49 percent of the dwellings, apartments, or other living accommodations of the project may be occupied by persons of low income.

2. The project is privately owned housing, is not exempt from ad valorem taxation by reason of any public ownership and is not financed with direct long-term financing from a public body.

3. The project is intended for owner-occupancy, which may include a limited-equity housing cooperative as defined in section 50076.5 of the Health and Safety Code, or cooperative or condominium ownership, rather than for rental-occupancy.

4. The project consists of newly constructed, privately owned, one- to four-family dwellings not located on adjoining sites.

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5. The project consists of existing dwelling units leased by the state public body from the private owner of these dwelling units.

6. The project consists of the rehabilitation, reconstruction, improvement or addition to, or replacement of, dwelling units of a previously existing low-rent housing project, or a project previously or currently occupied by lower-income households, as defined in section 50079.5 of the Health and Safety Code.

7. The project consists of the acquisition, rehabilitation, reconstruction, improvement, or any combination thereof, of a project which, prior to the date of the transaction to acquire, rehabilitate, reconstruct, improve, or any combination thereof, was subject to a contract for federal or state public body assistance for the purpose of providing affordable housing for lowincome households and maintains, or enters into, a contract for federal or state public body assistance for the purpose of providing affordable housing for low-income households.

If a project funded with a Bond BHCIP grant is a “low-income housing project” as defined by section 1 of article XXXIV of the California Constitution but does not meet any of the criteria listed above, then the applicant must comply with the requirements set forth in that section of the California Constitution.

Part Three: Application Process and Submission

3.1. Application Process
Applications will be accepted electronically only. Applications may not be hand delivered or mailed.

The application and attachments, along with instructions for submission of the online application, can be found on the BHCIP website. No modified formats will be accepted. The deadline for applications will be December 13, 2024, at 5 p.m. PT. It is the applicant’s responsibility to ensure that the submitted application is complete and accurate and includes all required supporting forms.

Reviewers may request additional clarifying information from the applicant. An application will not be reviewed in the following instances:
• The applicant does not request a PAC by the specified deadline (see section 1.4). • The application is received after the application submission deadline. • The application is incomplete or missing required information or forms, and/or does not include a complete development budget (see section 2.8). • The facility type is ineligible.
• The project fails to meet minimum threshold requirements (see section 2.2).

Reasonable Accommodations for Bond BHCIP Application
For individuals with disabilities, DHCS will provide assistive services such as reading or writing assistance and conversion of the RFA, questions/answers, RFA addenda, or other Administrative Notices in braille, large print, audiocassette, or computer disk. To request copies of written

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materials in an alternate format, please send an email to [email protected] or call (323) 545- 6202.

Regional Funding Reserve Methodology
DHCS will prioritize completed applications by geographic distribution (see Table 3). Bond BHCIP Round 1: Launch Ready will adopt a regional funding approach, similar to models used in other state-funded capital programs. Counties are assigned to one of seven geographic regions, each with a specific funding amount reserved. The funding amounts for each region, along with the tribal set-aside and discretionary reserve, are listed below. Applicants within each region will compete against other applicants in that same region, thereby supporting geographic equity and funding disbursement across the state. If an insufficient number of competitive applications is submitted from within a region, the remaining funding will be awarded at the discretion of DHCS.

Regional funding caps will be established and the amounts available per region will be determined based on the Behavioral Health Subaccount. In Bond BHCIP Round 1: Launch Ready, the $1.5 billion available exclusively for county, city, and tribal entities will not be subject to a regional funding cap.

In addition, for the Bond BHCIP Round 1: Launch Ready, up to $1.8 billion and Bond BHCIP Round 2: Unmet Needs up to $1.1 billion will be available for all eligible entities, 20 percent of funds available for Bond BHCIP will be set aside for use in regions at the State’s discretion to ensure funding is effectively aligned with need. (For example, this reserve money may be used to fund high-scoring projects in oversubscribed regions).

Following an initial round of regional funding allocations, DHCS will conduct periodic reviews of the number of completed applications from each region. If an insufficient number of competitive applications is received and awarded within a region, the remaining funding will be awarded at the discretion of DHCS or shifted to Bond BHCIP Round 2: Unmet Needs.

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Table 3. Bond BHCIP Round 1: Launch Ready—Regional and Statewide Funding

1. Regions for All Eligible Entity Funds
Subtotal Available to
Regions for All Eligible
Entities:
$1.8 billion
Los Angeles County
$479,190,226
Bay Area: Alameda, Contra Costa, Marin, Napa, San Francisco, San Mateo, Santa Clara, Solano, Sonoma
$278,108,183
Southern California: Imperial, Orange, Riverside, San Bernardino, San Diego, Ventura
$263,680,311
San Joaquin Valley: Fresno, Kern, Kings, Madera, Merced, San Joaquin, Stanislaus, Tulare
$154,666,275
Sacramento Area: El Dorado, Placer, Sacramento, Sutter, Yolo, Yuba $81,768,565
Central Coast: Monterey, San Benito, San Luis Obispo, Santa Barbara, Santa Cruz
$51,771,065
Balance of State: Alpine, Amador, Butte, Calaveras, Colusa, Del Norte, Glenn, Humboldt, Inyo, Lake, Lassen, Mariposa, Mendocino, Modoc, Mono, Nevada, Plumas, Shasta, Sierra, Siskiyou, Tehama, Trinity, Tuolumne
$58,815,375
Tribal
$90,000,000
Discretionary: The discretionary set-aside may also be used to fund highscoring projects in regions that have met their funding reserve.$342,000,000

2. No Regional Caps for County, City, and Tribal (only) Funds Subtotal Available
Statewide for County, City,
and Tribal*: $1.5 billion
Total for Bond BHCIP Round 1: Launch Ready Up to $3.3 billion * Of the $1.5 billion, a minimum of $30 million will be designated to tribal entities, as required by statute.

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3.2. Pre-Application Consultations and Technical Assistance As consistent with previous BHCIP rounds of funding, AHP, a consulting and research firm focused on improving health and human services systems, is serving as the administrative entity for BHCIP and will be assisting in the provision of TA.

Starting in August 2024, and concluding in November 2024, and as part of the RFA process, all prospective applicants will be required to engage in a PAC, which will provide an opportunity to discuss the proposed project, match requirements and potential sources of local match, statutory and regulatory requirements, how the project addresses local need/gaps and the State’s priorities, and other related considerations. AHP will provide PACs in coordination with experts in real estate, finance, tribal relations, and behavioral health, as needed. Applicants will submit a request for a PAC and complete a PAC request form to indicate their understanding of the project requirements.

The deadline to request a PAC will be October 15, 2024.

AHP will be holding office hours and offering bond funding application learning modules to potential applicants to assist in application preparation. These TA offerings will review various project-related topics. TA will help applicants understand the minimum project requirements and budgeting practices. Minimum project requirements will be discussed in the TA offerings, including match requirements, a sustainable business plan, a conceptual site plan, architectural and engineering narratives, roles and responsibilities of development teams, and initial budgeting based on conceptual site plans.

Upon receipt of an award and execution of the PFA, the eligible applicant and any co-applicants will be referred to as the project “sponsor,” both individually and collectively. Following award announcements, specialized TA will be provided to all Bond BHCIP grantees. In addition, AHP will offer ongoing general training and TA, including learning collaboratives and other opportunities, for grantees throughout the life of the project.

Additional information and TA related to the RFA will be available on the BHCIP website. AHP will also develop and update on an ongoing basis a list of Frequently Asked Questions (FAQs) that will be accessible to all prospective applicants and grantees. See the timeline in section 1.4 for important dates and times.

Part Four: Award Scoring and Process

4.1. Application Scoring Criteria
Eligible Bond BHCIP grant applications undergo a competitive review process. DHCS will only award and fund projects from applicants that are in good standing with all local, county, state, and federal laws and requirements.

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At a minimum, applicants must provide a full, complete application and meet the following criteria to be considered for award:
• Demonstrate expansion of services for individuals in need of crisis and/or behavioral health services.
• Demonstrate match.
• Schedule a PAC by the deadline of October 15, 2024, and complete it no later than November 14, 2024.
• Attest that the project will meet federal, state, and local laws. • Demonstrate the capacity to complete project development and expend funds on time and on budget.
• Align with the State priorities listed in section 1.1. • Align with needs and gaps outlined in the statewide assessment, “Assessing the Continuum of Care for Behavioral Health Services in California.” • Budget reasonable proposed costs for the facility type and scope of rehabilitation or renovations proposed.
• Demonstrate long-term sustainability for the proposed project. • Identify a service capacity increase in the total number of bed and/or slot count based on each proposed facility type and the individuals to be served.

Application scoring will also take into consideration the following factors:
• Later phases of development (see section 2.2) at the time of application • Expansion of residential/inpatient facilities
• Regional models or collaborative partnerships, including public-private partnerships, aimed at constructing, renovating, and/or expanding community-based services are eligible and encouraged, as are projects using a campus-type model that collocates multiple levels of care on the continuum, with a focus on residential treatment centers.

4.2. Award Process
Awarded applicants will receive a conditional award letter by email from DHCS/AHP. Access to awarded funds is contingent upon verification of grantee’s eligibility, completion of award certification steps, and final, digital execution of the PFA. Conditional grantees are expected to clear title to the subject property to be improved with Bond BHCIP funds and complete PFA execution within 90 days of receipt of the PFA. DHCS reserves the right to rescind conditional award funding and redirect it to alternate applicants in instances where extended delays in PFA execution occur.

As part of the PFA execution process, conditional grantees must execute a Facility Access Agreement (FAA) that states that DHCS will have access to the Bond BHCIP-funded facility throughout the 30-year encumbrance period. They must also provide a signed opinion letter from their legal counsel stating that the PFA, including real estate instruments, along with the program

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requirements, is not in conflict with any existing contract or agreement related to the property, project, or conditional grantee.

The PFA must be signed, returned, and fully executed with AHP before initial funding will be awarded. DHCS will not accept any changes, negotiations, or redlining to the PFA. Depending on the applications received, their project locations, allowable expenditures, amounts of funds requested, and funding available, DHCS may choose to fund only part of an application. In that case, DHCS would reach out to the potential grantee to determine their interest in receiving a smaller amount than originally requested.

Funds awarded pursuant to the project must be used to supplement, and not supplant, other funding available from existing local, state, or federal programs or from grants with similar purposes. Funding may not be used for “reimbursement.” Only those costs that can be associated with completing the project would be eligible costs, as noted in section 5.2.

Applicants that are not funded during Bond BHCIP Round 1: Launch Ready may be eligible to apply for Bond BHCIP Round 2: Unmet Needs funding. TA will be available on an ongoing basis.

4.3. Appeals
California law does not provide a protest or appeal process against award decisions made through an informal selection method. Applicants submitting a response to this RFA may not protest or appeal the award. All award decisions made by DHCS will be final.

Part Five: Project Operations

5.1. Project Oversight and Reporting
As specified by DHCS and upon request, grantees must provide progress reports in connection with the approved timeline, statement of work (SOW), and budget, as well as any updates to the timeline for completion of the project. The progress reports should include the project’s completion milestones and any updates or substantial changes. Grantees must promptly notify DHCS of any changes regarding organization, authorization, or capacity. This information will be outlined in the PFA.

Grantees are required to meet state financial and administrative reporting requirements and submit data through an online portal. Reporting requirements will include regular reports (at least once every 30 days) indicating progress toward meeting performance milestones, and a final report. The annual report will be due no later than January 31 for the prior calendar year of January 1 to December 31. Funding will be contingent upon provision of the timely submission of data and reporting. These requirements will be fully detailed upon award.

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In addition to the foregoing, each grantee must submit to DHCS periodic reports, updates, and information as deemed necessary by DHCS to monitor compliance and/or perform project evaluation. Any requested data or information must be submitted electronically in a format provided by DHCS.

Additional reporting requirements may be required by DHCS for up to 30 years after completion of project construction.

5.2. Disbursement of Grant Funds
The PFA will set forth the general conditions for disbursement. All grantees will be able to commence work and invoice for Bond BHCIP Round 1: Launch Ready project-specific expenses incurred back to the date of their conditional award, provided the expenses align with the project identified in the grant application and the final executed PFA and detailed SOW, and dated receipts/supporting documentation are available to verify project expenses. Eligible sunk costs may include the purchase of real property and construction or renovation/rehabilitation costs, including project planning or project management; appraisals; inspections; preconstruction costs such as permitting, surveying, architectural, and engineering fees; hardscaping and/or landscaping costs essential to the completion of the project (may not exceed 5 percent of the total grant award); and FFE (see section 2.7.) The project funding will become available upon final execution of the Bond BHCIP Round 1: Launch Ready PFA with AHP, at which point, the grantee may begin submitting invoices.

Disbursement of funds will follow bond payment processes and funding cycle. The grantee will submit relevant invoices to the draw authority for work completed. The draw authority will review the draw request, approve the invoices for work completed, and issue approval for disbursement of funds to the grantee. The grantee will then be responsible for paying invoices in a timely manner.

Subsequent funding for construction will be released following site inspections and once draw requests are submitted for work completed in alignment with the bond payment processes and funding cycle.

AHP will closely monitor progress on construction and will track and review all schedules, change orders, and contingency expenses. Grantees will be responsible for submitting invoices, revised budgets, and schedules to AHP for approval. Grantees must ensure that expenses are allowable under the PFA and will be expected to provide sufficient backup documentation. Grantees are responsible for ensuring that their project is on schedule and on budget. Grantees who are awarded Bond BHCIP funds will be solely responsible for any costs to complete the project in excess of the program funds award amount. Neither DHCS nor AHP will be responsible for any cost overruns. Additional details regarding the funding and disbursement process will be provided upon award.

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5.3. Funding Promotion
Grantees must collaborate with DHCS on requests to promote the award opportunity and services funded through the award. Requests for which the grantee will be responsible may include, but are not limited to, conducting media interviews; submitting letters to the editor of local or statewide publications; providing comments for related media activities; and/or submitting informational videos discussing the grantee’s organization, services provided, and resulting impacts of the Bond BHCIP funding on communities.

Part Six: Forms/Attachments (Total of 15)
Applicants must include all of the following attachments with the application. All required forms and supporting documents must be completed and uploaded in the application portal.

Form 1: Application Questions Guide (Note: additional questions may be included on the application portal)
Description: Application questions and related documents for Bond BHCIP Round 1:

Launch Ready
• Letter(s) of support
• Any preliminary site plans, design drawings, or construction drawings for the proposed project—these may include schematic designs, architectural drawings, construction blueprints, and/or other renderings (Please limit each file size to less than 20 MB). • Resumes of the development team that developed the design/construction plans. • A copy of all executed contracts for hire related to the project’s development team (lawyer, construction manager, development manager, architect, consultants, general contractor, etc.).
• Organization chart (for corporations, LLCs, and general partnerships owned by individuals or natural persons).
• A certified appraisal and a bank loan document, if identifying a real property contribution for match.
• A valid rough order of magnitude cost estimate if no construction plan is in place. • A preliminary title report.

Form 2: Budget Template
Description: Pre-formatted template for all costs related to the proposed project, including match
Form 3: Development Team Information
Description: Information about development team, including contact information and experience
Form 4: Design, Acquisition, and Construction Milestone Schedule Description: Schedule for achieving design, acquisition, and construction milestones

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Bond BHCIP Round 1: Launch Ready RFA

ATTACHMENT J RFA
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Form 5: Applicant’s Certification of Prevailing Wage (inclusion in estimated budget) Description: Certification with an attestation from the general contractor that the general contractor will comply with California’s prevailing wage and working hours laws Form 6: Applicant’s Certification of Funding Terms
Description: Certification that the applicant will receive, expend, and administer all funds received under this initiative pursuant to the terms outlined Form 7: Community Engagement
Description: Table to detail applicant outreach efforts related to the proposed project Form 8: Schematic Design Checklist
Description: Checklist of start and completion dates for schematic design drawings, including architectural and engineering technical information Form 9: Facility Financial Operating Pro Forma Template Description: Table of revenue and expenses to show annual net operating income Form 10: Board Authorizing Resolution (BAR) Template
Description: Template for eligible entities to confirm signing authority for the PFA. Local government entities are allowed to use their own authorizing resolution.

Attachment A: Pre-Application Consultation Process
Description: Outline of the PAC process, including a link to the required survey Attachment B: DHCS Allowable Expense List
Description: List of allowable expenses for Bond BHCIP-funded projects Attachment C: Letter of Support Guidelines
Description: Requirements related to all letters of support submitted as part of a Bond BHCIP Round 1: Launch Ready application
Attachment D: Budget Glossary of Terms
Description: Glossary of terms related to the budget for Bond BHCIP Round 1: Launch Ready applications
Attachment E: Glossary of Terms
Description: Glossary of terms for Bond BHCIP Round 1: Launch Ready

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ATTACHMENT K NOTICE OF CONDITIONAL AWARD LETTER
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ATTACHMENT K

NOTICE OF CONDITIONAL AWARD LETTER

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California Department of Health Care Services
Community Services Division
P.O. Box 997413 | Sacramento, CA | 95899-7413
MS Code 2635 | Phone (916) 440-7800 | www.dhcs.ca.gov
State of California
Gavin Newsom, Governor
California Health and Human Services Agency
May 6, 2025

THIS LETTER SENT VIA EMAIL
Ms. Bonnie Lipscomb, Director Economic Development & Housing City of Santa Cruz
809 Center Street
Santa Cruz, California 95060

BOND BEHAVIORAL HEALTH CONTINUUM INFRASTRUCTURE PROGRAM (BHCIP) ROUND 1: LAUNCH READY – NOTICE OF CONDITIONAL AWARD Dear Ms. Bonnie Lipscomb:

Congratulations! The Department of Health Care Services (DHCS) is pleased to announce that City of Santa Cruz has been selected to receive a conditional Bond BHCIP Round 1: Launch Ready grant funding award. At this time, DHCS will coordinate regional public award announcements on a rolling basis for Bond BHCIP Round 1. Please note this award information is under embargo and you should not share outside of your organization until you receive an email notification of the embargo lift from DHCS.

Awarded Project
• Project Name: Santa Cruz Coral Street SUD Campus
• Project Address(es): 125 Coral Street, Santa Cruz, California 95060 • Award amount: $30,000,000.00
• Match Source(s) and Amount: Equity Value from Property and Sunk Costs; $3,000,000.00
• Facility Type(s) and Behavioral Health Capacity Expansion:
o Adult Residential SUD Treatment Facility with 50 beds Your conditional award is being granted based on the project information identified above. Any project modifications will result in DHCS rescinding your grant funding.

The following outlines the expectations and next steps for conditional awardees that are required to finalize all Bond BHCIP Round 1: Launch Ready grant awards.

Please read all information carefully.

1. Award Acceptance and Attestation
Conditional awardee must acknowledge acceptance of the Bond BHCIP Round 1: Launch Ready conditional grant award by 5:00pm (PT) on May 13, Docusign Envelope ID: 3E26CE3E-3E86-4E88-9507-EABAD9456B66

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Notice of Conditional Bond BHCIP Round 1 Award