Santa Monica City Council
January 13, 2026

UNITED XYZ LLC
c/o XYZ.Rent – 1202 Third
2800 Olympic Blvd, Floor 1
Santa Monica, CA 90404

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Packet Pg. 657 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) 40 With a copy to:

Grant Carpenter
2800 Olympic Blvd, Floor 1
Santa Monica, CA 90404
Notice given in any other manner shall be effective when received by the addressee. Any Party may change the addresses for delivery of notices to such Party by delivering notice to the other Party in accordance with this provision.

15.2 Entire Agreement; Conflicts. This Agreement represents the entire agreement of the Parties. This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the Parties or their predecessors in interest with respect to all or any part of the subject matter hereof. Should any or all of the provisions of this Agreement be found to be in conflict with any other provision or provisions found in the Existing Regulations, then the provisions of this Agreement shall prevail.

15.3 Binding Effect. The Parties intend that the provisions of this Agreement shall constitute covenants which shall run with the land comprising the Property during the Term for the benefit thereof and that the burdens and benefits thereof shall bind and inure to the benefit of all successors-in-interest to the Parties hereto in accordance with Article 13. Every Party who now or hereafter owns or acquires any right, title, or interest in or to any portion of the Digital Display during the Term is and shall be conclusively deemed to have consented and agreed to every provision contained herein, to the extent relevant to said right, title or interest, whether or not any reference to this Agreement is contained in the instrument by which such person acquired an interest in the Digital Display.

15.4 Agreement Not for Benefit of Third Parties. This Agreement is made and entered into for the sole protection and benefit of Owner and the City and their respective successors and assigns. No other person shall have any right of action based upon any provision of this Agreement.

15.5 No Partnership or Joint Venture. Nothing in this Agreement shall be deemed to create a partnership or joint venture between the City and Owner or to render either Party liable in any manner for the debts or obligations of the other.

15.6 Estoppel Certificates. Either Party and any Secured Lender may, at any time, and from time to time, deliver written notice to the other Party requesting such Party to certify in writing (each, an “Estoppel Certificate”): (a) that this Agreement is in full force and effect, (b) that this Agreement has not been amended or modified either orally or in writing, or if so amended, identifying the amendments, (c) whether or not, to the knowledge of the responding Party, the requesting Party is in Breach or claimed Breach in the performance of its obligations under this Agreement, and, if so, describing the nature and amount of any such Breach or claimed Breach, and (d) whether or not, to the knowledge of the responding Party, any event has occurred or failed to occur which, with the passage of time or the giving of notice, or both, would constitute an Event of Monetary Default or an Event of Non-Monetary Default and, if so,

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Packet Pg. 658 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) 41 specifying each such event. A Party receiving a request for an Estoppel Certificate shall execute and return such Certificate within thirty (30) Days following the receipt of the request therefor.

If the party receiving the request hereunder does not execute and return the certificate in such 30- day period and if circumstances are such that the Party requesting the notice requires such notice as a matter of reasonable business necessity, the Party requesting the notice may seek a second request which conspicuously states “FAILURE TO EXECUTE THE REQUESTED ESTOPPEL CERTIFICATE WITHIN FIFTEEN (15) DAYS SHALL BE DEEMED WAIVER PURSUANT TO SECTIONS 15.6 AND 15.13 OF THE DEVELOPMENT AGREEMENT” and which sets forth the business necessity for a timely response to the estoppel request. If the Party receiving the second request fails to execute the Estoppel Certificate within such 15-day period, it shall be conclusively deemed that the Agreement is in full force and effect and has not been amended or modified orally or in writing, and that there are no uncured defaults under this Agreement or any events which, with passage of time of giving of notice, of both, would constitute a default under the Agreement. The City Manager shall have the right to execute any Estoppel Certificate requested by Owner under this Agreement. The City acknowledges that an Estoppel Certificate may be relied upon by any Property Transferee, Secured Lender or other party. The Estoppel Certificate shall be provided in lieu of zoning compliance letters authorized pursuant to SMMC Section 9.38.020(E), or any successor thereto.

15.7 Time. Time is of the essence for each provision of this Agreement of which time is an element.

15.8 Excusable Delays.

15.8.1 In addition to any specific provisions of this Agreement, nonperformance by Owner of its obligations under this Agreement shall be excused when it has been prevented or delayed in such performance by reason of any act, event or condition beyond the reasonable control of Owner (collectively, “Excusable Delays”) for any of the following reasons:
(a) War, insurrection, walk-outs, riots, acts of terrorism, floods, pandemic, earthquakes, fires, casualties, acts of God, or similar grounds for excused performances;
(b) Governmental restrictions or moratoria imposed by the City or by other governmental entities or the enactment of conflicting State or Federal laws or regulations; (c) The imposition of injunctive relief, restraining orders, restrictions or moratoria by judicial decisions or by litigation, contesting the validity, or seeking the enforcement or clarification of, this Agreement, whether instituted by Owner, the City or any other person or entity, or the filing of a lawsuit by any Party arising out of this Agreement or any permit or approval Owner deems necessary or desirable for the implementation of the Digital Display;
(d) The institution of a referendum pursuant to Government Code Section 65867.5 or a similar public action seeking to in any way invalidate, alter, modify or amend the ordinance adopted by the City Council approving and implementing this Agreement;

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Packet Pg. 659 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) 42 (e) Inability to secure necessary labor, materials or tools, due to strikes, lockouts, or similar labor disputes or due to a global pandemic; and/or (f) Failure of the City to timely perform its obligations hereunder, including its obligations under Section 7.2 above.

15.8.2 Under no circumstances shall the inability of Owner to secure financing be an Excusable Delay to the obligations of Owner except to the extent the inability to secure financing is directly associated with war, insurrection, walk-outs, riots, acts of terrorism, floods, pandemic, earthquakes, fires, casualties, acts of God or similar grounds beyond the control of Owner.

15.8.3 In order for an extension of time to be granted for any Excusable Delay, Owner must deliver to the City written notice of the commencement of the Excusable Delay within sixty (60) Days after the date on which Owner becomes aware of the existence of the Excusable Delay. The extension of time for an Excusable Delay shall be for the actual period of the delay.

15.8.4 Nothing contained in this Section 15.8 is intended to modify the terms of either Section 5.1.2 or Section 5.5 of this Agreement.

15.9 Governing Law. This Agreement shall be governed exclusively by the provisions hereof and by the laws of the State of California, without regard to any choice of law provisions thereof.

15.10 Cooperation in Event of Legal Challenge to Agreement. If there is any court action or other proceeding initiated by a third-party that includes any challenge to the validity, enforceability or any term or provision of this Agreement, the City’s CEQA determination for the Digital Display, and/or any other City approvals contemplated by this Agreement, then Owner shall indemnify, hold harmless, pay all costs actually incurred, and provide defense in said action or proceeding, with counsel reasonably satisfactory to both the City and Owner. The City shall cooperate with Owner in any such defense as Owner may reasonably request.

15.11 Attorneys’ Fees. If any Party commences any action for the interpretation, enforcement, termination, cancellation or rescission of this Agreement or for specific performance for the Breach of this Agreement, the prevailing Party shall be entitled to its reasonable attorneys’ fees, litigation expenses and costs. Attorneys’ fees shall include attorneys’ fees on any appeal as well as any attorneys’ fees incurred in any post-judgment proceedings to collect or enforce the judgment. Such attorneys’ fees shall be paid whether or not such action is prosecuted to judgment. In any case where this Agreement provides that the City or Owner is entitled to recover attorneys’ fees from the other, the Party so entitled to recover shall be entitled to an amount equal to the fair market value of services provided by attorneys employed by it as well as any attorneys’ fees actually paid by it to third Parties. The fair market value of the legal services for public attorneys shall be determined by utilizing the prevailing billing rates of comparable private attorneys.

15.12 Recordation. Parties shall cause this Agreement to be recorded against title to the Property in the Official Records of the County of Los Angeles in accordance with California

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Packet Pg. 660 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) 43 Government Code Section 65868.5. The cost, if any, of recording this Agreement shall be borne by Owner.

15.13 No Waiver. No waiver of any provision of this Agreement shall be effective unless in writing and signed by a duly authorized representative of the Party against whom enforcement of a waiver is sought and referring expressly to this Section 15.13. No delay or omission by either Party in exercising any right or power accruing upon non-compliance or failure to perform by the other Party under any of the provisions of this Agreement shall impair any such right or power or be construed to be a waiver thereof, except as expressly provided herein. No waiver by either Party of any of the covenants or conditions to be performed by the other Party shall be construed or deemed a waiver of any succeeding breach or nonperformance of the same or other covenants and conditions hereof of this Agreement.

15.14 Construction of this Agreement. The Parties agree that each Party and its legal counsel have reviewed and revised this Agreement and that any rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not apply in the interpretation of this Agreement or any amendments or exhibits thereto.

15.15 Other Governmental Approvals. Owner may apply for such other permits and approvals as may be required for development of the Digital Display in accordance with this Agreement from other governmental or quasi-governmental agencies having jurisdiction over the Property including, without limitation, applying for approval by the California Coastal Commission. The City shall reasonably cooperate with Owner in its endeavors to obtain such permits and approvals.

15.15.1 Further Assurances; Covenant to Sign Documents. Each Party shall take all actions and do all things, and execute, with acknowledgment or affidavit, if required, any and all documents and writings, which may be necessary or proper to achieve the purposes and objectives of this Agreement.

15.15.2 Processing. Upon satisfactory completion by Owner of all required preliminary actions and payments of appropriate processing fees, if any, the City shall, subject to all legal requirements, promptly initiate, diligently process, and complete at the earliest possible time all required steps, and expeditiously act upon any approvals and permits necessary for the development by Owner of the Digital Display in accordance with this Agreement, including, but not limited to, the following:
(a) the processing of applications for and issuing of all Discretionary Approvals requiring the exercise of judgment and deliberation by City; (b) the holding of any required public hearings; and
(c) the processing of applications for and issuing of all City Technical Permits requiring the determination of conformance with the Existing Regulations.

15.15.3 No Revocation. The City shall not revoke or subsequently disapprove any approval or future approval for the Digital Display once issued by the City provided that the Digital Display is in accordance with such approval. Any revocation or subsequent disapproval

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Packet Pg. 661 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) 44 by the City shall state in writing the reasons why the development of the Digital Display is not deemed to be in accordance with such approval and the suggested actions to be taken in order for approval to be granted.

15.15.4 Processing During Third Party Litigation. If any third party lawsuit is filed against the City or Owner relating to this Agreement, the City shall not delay or stop the development, processing or construction of the Digital Display, or issuance of the City Technical Permits, unless the third party obtains a court order preventing the activity. The City shall not stipulate to or fail to oppose the issuance of any such order. Notwithstanding the foregoing and without prejudice to the provisions of Section 15.8.1(c), after service on the City or Owner of the initial petition or complaint challenging this Agreement or the Digital Display, the Owner may apply to the Community Development Director for a tolling of the applicable deadlines for Owner to otherwise comply with this Agreement. The Community Development Director shall approve such tolling, consistent with the standard in Section 15.27, for up to five years during the pendency of the litigation and shall provide Owner with notice of his or her decision on the tolling request within forty (40) Days of receiving Owner’s request.

15.15.5 State, Federal or Case Law. Where any state, federal or case law allows the City to exercise any discretion or take any act with respect to that law, the City shall, in an expeditious and timely manner, at the earliest possible time, (i) exercise its discretion in such a way as to be consistent with, and carry out the terms of, this Agreement and (ii) take such other actions as may be necessary to carry out in reasonable good faith the terms of this Agreement.

15.16 Jurisdiction and Venue. Any legal action or proceeding among the Parties arising out of this Agreement shall be instituted in the Superior Court of the County of Los Angeles, State of California, in any other appropriate court in that County, or in the Federal District Court in the Central District of California. The parties agree that venue exists in either court, and each party expressly waives any right to transfer to another venue. The parties further agree that either court will have personal jurisdiction over the parties to this Agreement.

15.17 Exhibits. The following exhibits which are part of this Agreement are attached hereto and each of which is incorporated herein by this reference as though set forth in full:

Exhibit “A” Legal Description of the Property
Exhibit “B” Digital Display Plans
Exhibit “C” SMMC Article 9 (Planning and Zoning)
Exhibit “D” Conditions of Approval
Exhibit “E” Permitted Fees and Exactions
Exhibit “F” Form of Assignment and Assumption Agreement Exhibit “G” Digital Display District Ordinance
Exhibit “H” Advertising Content Standards
Except as to the Digital Display Plans, which shall be treated in accordance with Section

2.1 above, the text of this Agreement shall prevail in the event that any inconsistencies exist between the Exhibits and the text of this Agreement.

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Packet Pg. 662 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) 45 15.18 Counterpart Signatures. The Parties may execute this Agreement on separate signature pages which, when attached hereto, shall constitute one complete Agreement.

15.19 Certificate of Performance. Upon the completion of the Digital Display or upon performance of this Agreement or its earlier revocation and termination, the City shall provide Owner, upon Owner’s request, with a statement (“Certificate of Performance”) evidencing said completion, termination or revocation and the release of Owner from further obligations hereunder, except for any further obligations which survive such completion, termination or revocation. The Certificate of Performance shall be signed by the appropriate agents of Owner and the City and shall be recorded against title to the Property in the official records of Los Angeles County, California. Such Certificate of Performance is not a notice of completion as referred to in California Civil Code Section 3093.

15.20 Interests of Owner. Owner represents to the City that, as of the Effective Date, it is the owner of the entire Property, subject to encumbrances, easements, covenants, conditions, restrictions, and other matters of record.

15.21 Operating Memoranda. The provisions of this Agreement require a close degree of cooperation between the City and Owner. During the Term of this Agreement, clarifications to this Agreement and the Existing Regulations may be appropriate with respect to the details of performance of the City and Owner. If and when, from time to time, during the term of this Agreement, the City and Owner agree that such clarifications are necessary or appropriate, they shall effectuate such clarification through operating memoranda approved in writing by the City and Owner, which, after execution, shall be attached hereto and become part of this Agreement and the same may be further clarified from time to time as necessary with future written approval by the City and Owner. Operating memoranda are not intended to and cannot constitute an amendment to this Agreement but mere ministerial clarifications, therefore public notices and hearings shall not be required for any operating memorandum. The City Attorney shall be authorized, upon consultation with, and approval of, Owner, to determine whether a requested clarification may be effectuated pursuant to the execution and delivery of an operating memorandum or whether the requested clarification is of such character to constitute an amendment of this Agreement which requires compliance with the provisions of Section 8.1 above. The authority to enter into such operating memoranda is hereby delegated to the City Manager and the City Manager is hereby authorized to execute any operating memoranda hereunder without further action by the City Council.

15.22 Acknowledgments, Agreements and Assurance on the Part of Owner.

15.22.1 Owner’s Faithful Performance. The Parties acknowledge and agree that Owner’s faithful performance in developing the Digital Display on the Property and in constructing and installing certain public improvements pursuant to this Agreement and complying with the Existing Regulations will fulfill substantial public needs. The City acknowledges and agrees that there is good and valuable consideration to the City resulting from Owner’s assurances and faithful performance thereof and that same is in balance with the benefits conferred by the City on the Digital Display. The Parties further acknowledge and agree that the exchanged consideration hereunder is fair, just and reasonable. Owner acknowledges that the consideration is reasonably related to the type and extent of the impacts of the Digital

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Packet Pg. 663 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) 46 Display on the community and the Property, and further acknowledges that the consideration is necessary to mitigate the direct and indirect impacts caused by Owner on the Property.

15.22.2 Obligations to be Non-Recourse. As a material element of this Agreement, and in partial consideration for Owner’s execution of this Agreement, the Parties each understand and agree that the City’s remedies for breach of the obligations of Owner under this Agreement shall be limited as described in Sections 11.2 through 11.4 above.

15.23 Waiver of Protest. Owner acknowledges and agrees that by executing this Agreement, Owner waives any and all claims and rights, if any, under Government Code Section 66020 to protest fees, dedications, reservations, or exactions required by this Agreement (hereinafter “exactions”), including the City’s right to request and receive the exaction pursuant to this Agreement, the total exaction amount if specified by the Agreement, and the formula for subsequently calculating exactions if the formula is established by the Existing Regulations.

Notwithstanding the above, if the amount of any exaction is not expressly set forth in this Agreement, Owner reserves the right to protest the subsequent calculation of this amount.

15.24 Not a Public Dedication. Nothing in this Agreement shall be deemed to be a gift or dedication of the Property, or of the Digital Display, or any portion thereof, to the general public, for the general public, or for any public use or purpose whatsoever, it being the intention and understanding of the Parties that this Agreement be strictly limited to and for the purposes herein expressed for the installation, maintenance, and operation of the Digital Display as private property. Owner shall have the right to prevent or prohibit the use of the Property, or the Digital Display, or any portion thereof, including common areas and building and improvements located thereon, by any person for any purpose inimical to the development of the Digital Display, including without limitation to prevent any person or entity from obtaining or accruing any prescriptive or other right to use the Property or the Digital Display.

15.25 Other Agreements. The City acknowledges that certain additional agreements may be necessary to effectuate the intent of this Agreement and facilitate development of the Digital Display. The City Manager is hereby authorized to prepare, execute, and record those additional agreements.

15.26 Severability and Termination. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid or unenforceable, or if any provision of this Agreement is superseded or rendered unenforceable according to any law which becomes effective after the Effective Date, the remainder of this Agreement shall be effective to the extent the remaining provisions are not rendered impractical to perform, taking into consideration the purposes of this Agreement.

15.27 Community Development Director Approval. Whenever this Agreement requires Community Development Director review and approval, such review and approval shall be undertaken in reasonable good faith and with due diligence and shall not be unreasonably withheld, conditioned or delayed.

15.28 City Manager Approval. Whenever this Agreement requires City Manager review and approval, such review and approval shall not preclude the City Manager from consulting with the City Council before rendering an approval.

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Packet Pg. 664 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) 47 This Agreement is executed by the Parties on the date first set forth above and is made effective on and as of the Effective Date.

OWNER:

UNITED XYZ LLC,
a California limited liability company
By: ________DRAFT_______________
Name: __________________________
Title: ___________________________
CITY:

CITY OF SANTA MONICA,
a municipal corporation
By: ________DRAFT_______________
Name: ___________________________
Title: _____________________________
ATTEST:

By: ________DRAFT_______________
Name: ______________________________
City Clerk
APPROVED AS TO FORM:

By: ________DRAFT_______________
Name: ______________________________
City Attorney

ACKNOWLEDGEMENT AND CONSENT BY OPERATOR
As of the Effective Date of this Agreement, Orange Barrel Media, LLC, a Delaware limited liability company is the Operator as defined in Section 1.26 of this Agreement. Operator

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Packet Pg. 665 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) 48 confirms its understanding of this Agreement, including but not limited to, Section 2.5 (Project and Community Benefits) and 2.11 (Operator Not a Third-Party Beneficiary to this Agreement).

OPERATOR:

ORANGE BARREL MEDIA, LLC,
a Delaware limited liability company
By: ________DRAFT_______________
Name: __________________________

Title: ___________________________

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Packet Pg. 666 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) Exhibit “A”
EXHIBIT “A”

LEGAL DESCRIPTION OF PROPERTY

THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF SANTA

MONICA, IN THE COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:

LOTS “A”, “B” AND “Y”, IN BLOCK 122 OF SANTA MONICA, IN THE CITY OF SANTA

MONICA, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 3, PAGES 80 AND 81, AND IN BOOK 39, PAGES 45 THROUGH 51,

INCLUSIVE, BOTH OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

APN: 4291-002-001

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Packet Pg. 667 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) Exhibit “B”
EXHIBIT “B”

DIGITAL DISPLAY PLANS
[Behind this Page.]

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Packet Pg. 668 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading)

PROPERTY LINE

PROPERTY LINE
18’-6” 17’-6” 7’-0”

NEW MEDIA OPERATOR IDENTIFICATION SIGNAGE,
INTERNALLY ILLUMINATED LETTERS 7” H x 10’-0” W
NEW 1000 SF TOTAL LED SIGNAGE,

WRAPS AROUND TO WILSHIRE ELEVATION

EXISTING FLUTED TOWER

EXISTING FLUTED TOWER

NEW ARCHITECTURAL TRIM

REACTIVATE EXISTING BLADE SIGN,
SEE ELEVATION 47”
17” 13 5/8”
233”
1/8” THICK ALUMINUM CUTOUT

PAINTED BLACK AND FLUSH MO

TO EXISTING BLADE, BOTH SID

BLADE SIGN ELEVATION EAST ELEVATION
3RD STREET PROMENADE

ELEVATIONS
36'-0"

GRADE TO TOP OF SIGN

NEW ARCHITECTURAL TRIM, PAINTED

FINISH TO MATCH BRUSHED ALUMINUM

ADJUSTABLE WALL WASH FIXTURES

MOUNTED TO REAR OF SIGN FRAME

ILLUMINATE THE FLUTED TOWER ABOVE

AND BELOW THE SIGN
5'-0"
2'-3"
1202 3RD ST - NOVEMBER 18, 2025 © 2025 ORANGE BARREL MEDIA

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Packet Pg. 669 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading)

PROPERTY LINE

PROPERTY LINE
18’-6” 17’-6” 7’-0”
NEW 1000 SF TOTAL LED SIGNAGE,
WRAPS AROUND TO 3RD ST ELEVATION

EXISTING FLUTED TOWER

NEW ARCHITECTURAL TRIM

EXISTING FLUTED TOWER

NORTH ELEVATION
WILSHIRE BOULEVARD 36'-0" GRADE TO TOP OF SIGN

ELEVATIONS

ADJUSTABLE WALL WASH FIXTURES

MOUNTED TO REAR OF SIGN FRAME

ILLUMINATE THE FLUTED TOWER ABOVE

AND BELOW THE SIGN

NEW ARCHITECTURAL TRIM, PAINTED

FINISH TO MATCH BRUSHED ALUMINUM
1'-6" 18'-8"
1'-6"
3'-0"
1202 3RD ST - NOVEMBER 18, 2025 © 2025 ORANGE BARREL MEDIA

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Packet Pg. 670 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading)

PROPERTY LINE
10’-0” 7’-8”
54’-10” LENGTH LED SCREEN
31’-6” 10’-0”
R = 10’-0”

NEW ARCHITECTURAL TRIM

EXISTING
AWNING

PLOT PLAN
5'- 0"
5'-0"
1'-10"

NEW ARCHITECTURAL TRIM ON BOTH

ENDS OF SIGN FACE

EXISTING TRIM PIECES TO REMAIN

EXISTING LIGHT WASH TO BE

REACTIVATED

LED MODULES &

SUB-FRAME
1202 3RD ST - NOVEMBER 18, 2025 © 2025 ORANGE BARREL MEDIA

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Packet Pg. 671 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) 18’-6” 17’-6” 7’-0”
3’-11”
17” 13 5/8”
19’-5”
1/8” THICK ALUMINUM CUTOUT LETTERS

PAINTED BLACK AND FLUSH MOUNTED

TO EXISTING BLADE, BOTH SIDES

BLADE SIGN ELEVATION

BLADE SIGN REACTIVATION
1202 3RD ST - NOVEMBER 18, 2025 © 2025 ORANGE BARREL MEDIA

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Packet Pg. 672 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) Exhibit “C”
EXHIBIT “C”
SMMC ARTICLE 9 (PLANNING AND ZONING)
[To be inserted.]

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Packet Pg. 673 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) Exhibit “D”
EXHIBIT “D”

CONDITIONS OF APPROVAL
Project Specific Conditions

1. The Digital Display shall provide the project and community benefits as established in Section 2.5 of this Agreement.

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Packet Pg. 674 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) Exhibit “E”
EXHIBIT “E”

PERMITTED FEES AND EXACTIONS

1. Owner shall pay the following fees and charges that are within the City’s jurisdiction and at the rate in effect at the time payments are made:
(a) Upon submittal for plan check, Owner shall pay City plan check fees; (b) Prior to issuance of construction permits, Owner shall pay the following City fees and all other standard fees imposed on similar development projects, which may include:
 Building, Plumbing, Mechanical, Electrical, Grading, Seismic Mapping, Landscape, Excavation and Shoring Permit fees (collected by Building & Safety)
 Construction and Demolition (C&D) Waste Management performance security fee (SMMC Chapter 8.108) (collected by the Public Works Department)
(c) Upon inspection of the project during the course of construction, City inspection fees.

These fees shall be reimbursed to Owner in accordance with the City's standard practice should Owner not proceed with development of the project.

2. Prior to issuance of permits for any construction work in the public right-of-way, or use of public property, Owner shall pay the following City fees:
 Use of Public Property Permit fees (SMMC 7.04.670) (Public Works Department)
 Utility Excavation Permit fee (SMMC 7.06.070) (Public Works Department)  Street Permit fee (SMMC 7.04.790) (Public Works Department)

3. Owner shall reimburse the City for its ongoing actual costs to monitor the project’s compliance with this Development Agreement. The City shall bill Owner for staff time and any material used pursuant to the hourly fees in effect at the time monitoring is performed. Owner shall submit payment to the City within 30 days after receipt of an invoice for same from the City.

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Packet Pg. 675 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) Exhibit “F”, Page 1
EXHIBIT “F”

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
Recording Requested By and
When Recorded Mail To:

UNITED XYZ LLC
c/o XYZ.Rent – 1202 Third
2800 Olympic Blvd, Floor 1
Santa Monica, CA 90404
________________________________________________________________________

ASSIGNMENT AND ASSUMPTION AGREEMENT
This ASSIGNMENT AND ASSUMPTION AGREEMENT (“Agreement”) is made and entered into by and between ___________________________, a _____________________________ (“Assignor”), and ________________________, a __________________ (“Assignee”).

R E C I T A L S
[NOTE TO DRAFTER: This form Assignment and Assumption Agreement is drafted for a purchase and sale of the full Project Site. If the transfer is other than a purchase and sale and/or less than the entire Project Site is being transferred, this form needs to be revised. Notably, if less than the entire Project Site is being transferred and/or the Project Site or any portion therefore is being transferred to more than one owner, this form needs to be revised to add joint and several liability for all owners of the Project Site.] A. The City of Santa Monica (“City”) and Assignor entered into that certain Development Agreement dated _______________, ____ (the “Development Agreement”), with respect to the real property located in the City of Santa Monica, State of California more particularly described in Exhibit “A” attached hereto (the “Project Site”).

B. Assignor has obtained from the City certain development approvals and permits with respect to the development of the Project Site, including without limitation, approval of the Development Agreement for the Project Site (collectively, the “Digital Display Approvals”).

C. Assignor intends to sell, and Assignee intends to purchase, the Project Site.

D. In connection with such purchase and sale, Assignor desires to transfer all of the Assignor’s right, title, and interest in and to the Development Agreement and the Digital Display Approvals with respect to the Project Site. Assignee desires to accept such assignment from Assignor and assume the obligations of Assignor under the Development Agreement and the Digital Display Approvals with respect to the Project Site.

THEREFORE, the parties agree as follows:

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Packet Pg. 676 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) Exhibit “F”, Page 2

1. Assignment. Assignor hereby assigns and transfers to Assignee all of Assignor’s right, title, and interest in and to the Development Agreement and the Digital Display Approvals with respect to the Project Site. Assignee hereby accepts such assignment from Assignor.

2. Assumption. Assignee expressly assumes and agrees to keep, perform, and fulfill all the terms, conditions, covenants, and obligations required to be kept, performed, and fulfilled by Assignor under the Development Agreement and the Digital Display Approvals with respect to the Project Site.

3. Effective Date. The execution by City of the attached receipt for this Agreement shall be considered as conclusive proof of (a) delivery of this Agreement (b) the assignment and assumption contained herein, and (c) the release of Assignor in accordance with Section 13.2 of the Development Agreement. This Agreement shall be effective upon its recordation in the Official Records of Los Angeles County, California, provided that Assignee has closed the purchase and sale transaction and acquired legal title to the Project Site.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the dates set forth next to their signatures below.
“ASSIGNOR”
_________________________________
“ASSIGNEE”
_____________________________

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Packet Pg. 677 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) Exhibit “F”, Page 3

RECEIPT BY CITY
The attached ASSIGNMENT AND ASSUMPTION AGREEMENT is received by the City of Santa Monica on this ___ day of ________________, ________.

CITY OF SANTA MONICA
___________________________________
By: _______________________________
Community Development Director

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Packet Pg. 678 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) Exhibit “G”
EXHIBIT “G”
Digital Display District Ordinance
[To be inserted.]

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Packet Pg. 679 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) Exhibit “H”
EXHIBIT “H”

ADVERTISING CONTENT STANDARDS
The City allows exterior advertising without regard to content and viewpoint, except advertising that contains material falling within one or more of the following categories:

1. Obscene Matter or Harmful Matter as those terms are defined by the California Penal Code Sections 311 or 313.

2. False, misleading or deceptive material. Any material that is, or the sponsor reasonably should have known is, false, fraudulent, misleading, deceptive, or would constitute a tort of defamation or invasion of privacy.

3. Material that infringes on any copyright, trade or service mark, title, or slogan.

4. Illegal activity and hate speech. Material that promotes or encourages unlawful or illegal behavior or activities under local, state, or federal laws.

5. Profanity and violence. Advertising that contains any profane language, or portrays images or descriptions of graphic violence, or intentional infliction of pain or violent action towards or upon a person or animal, or that depicts weapons or devices that appear to be aimed or pointed at the viewer or observer in a menacing manner.

6. Effects likely to cause driver distraction, including but not limited to flashing lights, copy that simulates any traffic sign in a manner which confuses the public, or anything that may interfere with the safe operation of traffic, pedestrians, or the public at large.

7. Material that conflicts with any applicable federal, state, or local law, statute, or ordinance, including but not limited to laws and regulations regarding advertising of tobacco, alcohol, and cannabis products.

8. Political advertisements designed to promote views of particular political groups or influence opinions of others on public policy issues.

9. Predatory lending services, predatory solicitation, and/or displays false, misleading or deceptive content.”

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Packet Pg. 680 Attachment: ORD-ord-Second Reading 1202 3RD DA (7476 : Digital Display DA - 1202 Third Street Promenade - Second Reading) City Council
Report
City Council Meeting: January 13, 2026
Agenda Item: 4.J
1 of 1
To: Mayor and City Council
From: Heidi Von Tongeln, Interim City Attorney, City Attorney's Office, Administration
Subject: Second Reading and Adoption of an Ordinance to Approve a Development Agreement for a Digital Display Located at 301 Arizona Avenue/1253 Third Street Promenade
Recommended Action
Staff recommends that the City Council adopt the attached Ordinance.

Executive Summary
At its meeting on December 16, 2025, the City Council introduced for first reading an Ordinance to approve a Development Agreement for a Digital Display located at 301 Arizona Avenue/1253 Third Street Promenade. The ordinance is now presented to the City Council for adoption.

Prepared By: Bradley Michaud, Legal Administrative Services Officer Approved Forwarded to Council
Attachments:

A. ORD-ord-Second Reading 301 AZ DA

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Packet Pg. 681
1 City Council Meeting: January 13, 2026 Santa Monica, California ORDINANCE NUMBER __________ (CCS)
(City Council Series)

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF

SANTA MONICA APPROVING THE DEVELOPMENT AGREEMENT

BETWEEN THE CITY OF SANTA MONICA, A MUNICIPAL CORPORATION, AND UNITED XYZ LLC, A CALIFORNIA LIMITED LIABILITY COMPANY (“OWNER”) TO ALLOW A DIGITAL DISPLAY AT 301 ARIZONA /1253 THIRD STREET

PROMENADE
WHEREAS, pursuant to California Government Code Section 65864 et seq. and Chapter 9.60 of the Santa Monica Municipal Code (collectively, the “Development Agreement Statutes”), the City is authorized to enter into binding development agreements with persons or entities having a legal or equitable interest in real property for the development of such real property; and
WHEREAS, Owner is the owner of approximately 14,998 square feet of land located in the City of Santa Monica, State of California, commonly known as 301 Arizona and 1253 Third Street Promenade, as more particularly described in Exhibit “A” attached to the Development Agreement (the “Property”); and WHEREAS, the Property is developed with an existing approximately 31,560 square foot commercial building that is occupied with commercial (retail and office) uses (the “Existing Building”); and
WHEREAS, the City has included the Property within the Downtown Core land use designation under the City’s Land Use and Circulation Element of its General Plan (the “LUCE”). The Property is in the Bayside Conservation “BC” (Promenade) District under the Downtown Community Plan (“DCP”) and is located within the Bayside Conservation “BC” (Third Street Promenade Area) designation under the City’s Zoning

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Packet Pg. 682 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 2 Ordinance, and is located within the boundaries of the Digital Display District. The Property is also located in the California Coastal Zone; and WHEREAS, the City and Owner desire to allow Owner to install, operate, maintain, and repair a high-quality LED digital display and associated sign structure (the “Digital Display”) on the Existing Building for displaying paid static or full motion onpremises and/or off-premises advertising, artistic creations, civic announcements of public interest or importance and content promoting the City and/or its rich history, including Downtown Santa Monica and the Third Street Promenade. The operation of the Digital Display will generate revenues for the City through the Community Benefit Payment set forth in the Development Agreement; and
WHEREAS, Owner has advised the City of Owner’s intent to allow a third party billboard operator to operate and own, lease, or license the Digital Display from Owner during the term of the Development Agreement; and
WHEREAS, on November 21, 2024, Owner filed an application for a Development Agreement (24ENT-0233), pursuant to Santa Monica Municipal Code (“SMMC”) Section 9.60.020 (the “Development Application”). The Development Application proposes an approximately one thousand (1,000) square foot full motion, animated Digital Display to be installed on the Existing Building; and WHEREAS, the design of the Digital Display is more particularly depicted on the Digital Display Plans dated November 18, 2025 and attached as Exhibit “B” to the Development Agreement (the “Digital Display Plans”); and WHEREAS, Owner has paid all necessary costs and fees associated with the City’s processing of the Development Application and the Development Agreement; and

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Packet Pg. 683 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 3 WHEREAS, the primary purpose is to allow for a Digital Display on the Property to (1) create a visually stimulating and informative experience at the corner of Arizona Avenue and the 1200 block of the Promenade; (2) promote the City, including the Third Street Promenade, and the arts, attract visitors and patrons to the Promenade; (3) complement the City’s Entertainment District; as well as (4) generate a new source of revenue for the City. The Parties desire to enter into the Development Agreement in conformance with the Development Agreement Statutes in order to achieve the development of the Digital Display on the Property; and WHEREAS, the Digital Display is also consistent with and implements numerous LUCE and DCP goals and policies including:
 LUCE Goal D1 - “Maintain Downtown’s competitive advantage as a premier local and regional shopping, dining, and entertainment destination, and support its evolution in order to respond to changing market conditions.”  LUCE Goal E1 - “Create an economic base that satisfies the commercial service needs of the City’s residents while providing employment opportunities and a strong fiscal infrastructure for the City.”  LUCE Goal E4 - “Support the retail sector in order to provide for the needs of local residents and visitors and augment sales tax revenues.”  LUCE Policy E1.1 – “Make land use decisions that respond to changing market conditions and meet the needs of City residents and visitors.”  LUCE Policy E4.6 - “Support Downtown as Santa Monica’s primary destination for comparison retail, including a mix of local, national and

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Packet Pg. 684 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 4 international shops and restaurants that serve residents, visitors and area employees.”
 DCP Goal CCP2 - “Downtown continues to be a thriving and diverse economic force that supports the city’s vitality, fiscal stability and high levels of community services.”
 Goal CCP5: The Third Street Promenade continues to anchor the Downtown’s retail and public space experience with updated features and activities.
 Policy CCP5.1 New public art should be encouraged and located to enhance the pedestrian experience and create an immersive arts experience.
 Action CCP5.1A Install Pathway Art, Banners and Urban Design Features to support the walking experience and to promote awareness of Downtown’s cultural offerings.
 Policy CCP5.2 Consider opportunity for negotiated development agreement art contributions to be aggregated in order to facilitate the acquisition of significant public art pieces.
 DCP Goal LU3 - “Santa Monica’s Downtown continues to be the economic center for the City, providing a diverse and flexible mix of uses that can meet future resident, business and visitor demand.”
 “The Bayside Conservation district is considered the pedestrian and economic heart of the City. Anchored by the Third Street Promenade, it is a vibrant urban atmosphere supported by a broad mix of building types, office

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Packet Pg. 685 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 5 space, entertainment, retail, restaurants, cafes, salons and exercise studios.

The DCP supports the continued expansion of the central retail district by increasing the energy and pedestrian traffic on streets around the Promenade.” (DCP p. 22-23.)
WHEREAS, the City Council has determined that a development agreement is appropriate for the proposed development of the Digital Display on the Property. The Development Agreement will (1) eliminate uncertainty in planning for the Digital Display and result in the orderly development of the Digital Display in accordance with the Digital Display District Ordinance, (2) assure installation of necessary improvements on the Property, (3) provide for public infrastructure and services appropriate to development of the Digital Display, (4) secure for the City improvements that benefit the public, (5) ensure the provision of community benefits as envisioned in the LUCE , DCP, and the Digital Display District Ordinance, and (6) otherwise achieve the goals and purposes for which the Development Agreement Statutes were enacted; and WHEREAS, the Development Agreement is consistent with the public health, safety, and welfare needs of the residents of the City and the surrounding region. The City has specifically considered and approved the impacts and benefits of the development of the Digital Display on the Property in accordance with the Development Agreement. The Digital Display will provide a number of significant project and community benefits as set forth in Section 2.5 of the Development Agreement; and WHEREAS, the City Council has found that the provisions of the Development Agreement are consistent with the relevant provisions of the City’s General Plan,

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Packet Pg. 686 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 6 including the LUCE, the DCP, the Digital Display District Ordinance, and the 1992 LUP; and
WHEREAS, on October 29, 2025, the City's Planning Commission held a duly noticed public hearing on the Development Application and the Development Agreement, and at such hearing, the Planning Commission recommended that the City Council approve the Digital Display including the Development Agreement; and WHEREAS, on December 16, 2025, the City Council held a duly noticed public hearing on the updated Development Application and the Development Agreement, and at such hearing the City determined the Digital Display is exempt from the California Environmental Quality Act (“CEQA”) pursuant to a Class 1 exemption (existing facilities) per CEQA Guidelines Section 15301, a Class 3 exemption (new construction or conversion of small structures) per CEQA Guidelines Section 15303, a Class 11 exemption (accessory structures) per CEQA Guidelines Section 15311, and a Class 32 categorial exemption (in-fill development) per CEQA Guidelines Section 15332; and WHEREAS, the proposed Development Agreement, which is attached hereto as Exhibit A to this ordinance, conforms to the requirements of Government Code sections 65450 et seq. as well as the requirement of Chapter 9.60 of the Santa Monica Municipal Code (Development Agreements); and
WHEREAS, the City Council, after consideration of all oral and written testimony presented at the duly noticed meeting of the City Council on December 16, 2025, made the following findings (collectively, “the Findings”):

Development Agreement Findings

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Packet Pg. 687 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 7 1. The Development Agreement is consistent with the objectives, policies, general land uses and programs specified in the general plan and any applicable specific plan. The 301 Arizona Avenue site is located in the LUCE’s Downtown District and has a Downtown Core General Plan Land Use Designation. Goals and policies in this District are geared primarily toward reinforcing the Downtown as the focus of the City, encouraging a broad mix of uses and new investment in the District that creates dynamic daytime and evening activity, and reinforces the Downtown as the place with the greatest concentration of activity in the City. The proposed Digital Display supports the City’s goals to encourage economic vitality, enhance placemaking, and promote creative, high-quality design within the Downtown. Goal LU2 establishes Downtown as a thriving creative and cultural center with a unique concentration of innovative businesses, performance spaces, museums and programmed events. The Development Agreement is consistent with Goal LU3, which imagines Santa Monica’s Downtown continues to be the economic center for the City, providing a diverse and flexible mix of uses that can meet future resident, business and visitor demand and also consistent with Goal CCP2 which calls for Downtown to be a thriving and diverse economic force that supports the city’s vitality, fiscal stability and high levels of community services. The Development Agreement is also aligned with Goal CCP5: The Third Street Promenade continues to anchor the Downtown’s retail and public space experience with updated features and activities. The 301 Arizona Avenue site is also located in the California Coastal Zone, and the Development Agreement is consistent with and implements various goals and policies of the 1992 Local Coastal Program Land Use Plan. The proposed digital display complements and supports the district’s

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Packet Pg. 688 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 8 retail and visitor-serving commercial uses consistent with LUP Policy 70. The Digital Display enhances the visual experience in the coastal zone including with public works of art consistent with LUP Policy 46.

2. The Development Agreement is compatible with the uses authorized in the district in which the real property is located, in that the project site is located within the Downtown – Bayside Conservation (BC) District, which permits a variety of active commercial and entertainment-oriented uses. The proposed Digital Display would complement the existing entertainment, retail, dining, and visitor activities. It will enhance the visual and economic activity of the Promenade while complying with operational and design standards established in the Digital Display District Ordinance, including limits on brightness, operating hours, and maintenance. These measures ensure the display complements the district’s entertainment character while minimizing effects on nearby light-sensitive residential uses. The Development Agreement is also consistent with Policy CCP5.1 that states new public art should be encouraged and located to enhance the pedestrian experience and create an immersive arts experience and Policy PPS4.3 calling for the Third Street Promenade to be regularly updated to remain consistent with the surrounding areas in terms of infrastructure, landscaping, signage and aesthetic upgrades.

3. The Development Agreement is in conformity with the public necessity, public convenience, general welfare, and good land use practices by establishing clear parameters for Digital Display design, operation, and maintenance, while providing substantial community benefits. These include revenue-sharing with the City, a minimum annual financial guarantee, and a 20% allocation of display time for civic and

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Packet Pg. 689 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 9 cultural content such as public safety messages, community event information, and local art. Consistent with the Digital Display District Ordinance, the Development Agreement also advances good land use practices by concentrating digital displays within a focused geographic area and ensuring high-quality design standards that reinforce the City’s goals for a safe, engaging, and economically vibrant urban environment.

4. The Development Agreement will not be detrimental to the health, safety and general welfare of City residents, based on factors including but not limited to such factors as distracted driving, pedestrian and driver safety, light and glare, or aesthetics.

The Development Agreement includes multiple safeguards to protect public health and safety. Illumination levels, transition speeds, and display operations are regulated to minimize glare, driver distraction, and light spillover onto nearby residences. The display incorporates automatic dimming technology and is required to power off between 1:00 a.m. and sunrise. The Digital Display will not show flashing or scrolling text and other visual effects that could compromise driver safety. Collectively, these measures ensure the display operates safely and responsibly without detrimental impacts to the public or surrounding community.

5. The Development Agreement will not adversely affect the orderly development of the property in that the Digital Display will be installed on an existing commercial building, designed to integrate architecturally with the structure. The Development Agreement includes building occupancy standards to promote active ground-floor use, thereby supporting economic activity and maintaining the vitality of the Promenade.

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Packet Pg. 690 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 10 6. The Development Agreement will have a positive fiscal impact on the City.

Through a negotiated revenue-sharing structure and minimum annual guarantee, the Development Agreement will provide an ongoing source of funding to support City programs, services, and public art initiatives. The Development Agreement will also include a one-time payment contribution to the City upon completion of the Digital Display. In addition, by activating a key intersection of the Promenade and attracting visitors, the DA will contribute to increased economic activity, benefiting nearby businesses and generating additional tax revenues for the City. These benefits would not otherwise accrue to the public in the absence of the installation of the Digital Display.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. The above recitals are true and correct, and incorporated herein by this reference.

SECTION 2. The City Council hereby adopts the Findings, and recommends approval of the Development Agreement, attached hereto as Exhibit “A” and incorporated herein by this reference.

SECTION 3. Based upon Findings 1-6, the Development Agreement is hereby approved.

SECTION 4. Each and every term and condition of the Development Agreement shall be and is made a part of the Santa Monica Municipal Code and any appendices thereto. The City Council of the City of Santa Monica finds that public necessity, public

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Packet Pg. 691 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 11 convenience, and general welfare require that any provision of the Santa Monica Municipal Code or appendices thereto inconsistent with the provisions of the Development Agreement, to the extent of such inconsistencies and no further, be repealed or modified to that extent necessary to make fully effective the provisions of the Development Agreement.

SECTION 5. Any provision of the Santa Monica Municipal Code or appendices thereto, inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, are hereby repealed or modified to that extent necessary to affect the provisions of this Ordinance.

SECTION 6. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of any competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance, and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the Ordinance would be subsequently declared invalid or unconstitutional.

SECTION 7. The Mayor shall sign and the City Clerk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Ordinance shall be effective 30 days from its adoption.

APPROVED AS TO FORM:
______________________________

HEIDI VON TONGELN
Interim City Attorney

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Packet Pg. 692 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 12 EXHIBIT A

DEVELOPMENT AGREEMENT

[behind this page]

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Packet Pg. 693 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Recording Requested By:

City of Santa Monica
When Recorded Mail To:

City of Santa Monica
Santa Monica City Attorney's Office
1685 Main Street, Third Floor
Santa Monica, CA 90401
Attention: City Attorney
_______________________________________________________________________ Space Above Line For Recorder's Use
No Recording Fee Required
California Government Code Section 27383

DEVELOPMENT AGREEMENT

BETWEEN

CITY OF SANTA MONICA,
AND

UNITED XYZ LLC

FOR A DIGITAL DISPLAY
AT 301 ARIZONA AVENUE & 1253 THIRD STREET PROMENADE
__________________, 2026

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Packet Pg. 694 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second i

TABLE OF CONTENTS
RECITALS ......................................................................................................................................1 ARTICLE 1 DEFINITIONS ............................................................................................................4 ARTICLE 2 DESCRIPTION OF THE DIGITAL DISPLAY .........................................................6

2.1 General Description ..........................................................................................................6

2.2 Principal Components of the Digital Display ...................................................................7

2.3 No Obligation to Develop .................................................................................................7

2.4 Vested Rights ....................................................................................................................7

2.5 Project and Community Benefits ......................................................................................9

2.5.1 One-Time Community Benefit Contribution ....................................................................9

2.5.2 Ongoing Community Benefit Contribution ......................................................................9

2.6 Maintenance and Upgrades .............................................................................................17

2.7 Removal of Digital Display ............................................................................................18

2.8 Projections, Design, and Operation Standards ................................................................18

2.9 Coastal Commission Review ..........................................................................................18

2.10 Owner Solely Responsible for Compliance with The Terms and Conditions of this Agreement ................................................................................................................18

2.11 Operator Not a Third-Party Beneficiary to this Agreement ............................................18

2.12 Relationship to Owner/Operator Agreements .................................................................19 ARTICLE 3 CONSTRUCTION ....................................................................................................19

3.1 [Reserved.] ......................................................................................................................19

3.2 Construction Hours .........................................................................................................19

3.3 Outside Building Permit Issuance Date ..........................................................................19

3.4 Construction Period ........................................................................................................20

3.5 Extended Vested Rights ..................................................................................................20

3.6 Existing Building Repairs, Remodeling, Reconstruction or Redevelopment and/or Digital Display Damage ......................................................................................20

3.7 City Termination Option .................................................................................................21 ARTICLE 4 FEES, EXACTIONS, AND CONDITIONS .............................................................21

4.1 Fees, Exactions, and Conditions .....................................................................................21

4.2 Conditions on Modifications...........................................................................................21

4.3 Implementation of Conditions of Approval ....................................................................21

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Packet Pg. 695 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second ii
ARTICLE 5 EFFECT OF AGREEMENT ON CITY LAWS AND REGULATIONS ................22

5.1 Development Standards for the Digital Display; Existing Regulations ..........................22

5.2 Permitted Subsequent Code Changes .............................................................................23

5.3 Common Set of Existing Regulations .............................................................................24

5.4 Conflicting Enactments ...................................................................................................24

5.5 Timing of Development ..................................................................................................24 ARTICLE 6 DESIGN APPROVAL ..............................................................................................25 ARTICLE 7 CITY TECHNICAL PERMITS ................................................................................25

7.1 Definitions.......................................................................................................................25

7.2 Diligent Action by City ...................................................................................................25

7.3 Conditions for Diligent Action by the City .....................................................................25

7.4 Duration of Technical City Permits ................................................................................27 ARTICLE 8 AMENDMENT AND MODIFICATION .................................................................27

8.1 Amendment and Modification of Development Agreement ..........................................27 ARTICLE 9 TERM ........................................................................................................................27

9.1 Effective Date .................................................................................................................27

9.2 Term. ...............................................................................................................................27 ARTICLE 10 PERIODIC REVIEW OF COMPLIANCE .............................................................28

10.1 City Review ....................................................................................................................28

10.2 Evidence of Reasonable Good Faith Compliance ..........................................................29

10.3 Information to be Provided to Owner .............................................................................29

10.4 Notice of Breach; Cure Rights ........................................................................................29

10.5 Failure of Periodic Review .............................................................................................29

10.6 Termination of Development Agreement .......................................................................29

10.7 City Cost Recovery .........................................................................................................29 ARTICLE 11 DEFAULT...............................................................................................................30

11.1 Notice and Cure ..............................................................................................................30

11.2 Remedies for Monetary Default ......................................................................................30

11.3 Remedies for Non-Monetary Default .............................................................................31

11.4 Modification or Termination of Agreement by City .......................................................33

11.5 Cessation of Rights and Obligations ...............................................................................33

11.6 Completion of Improvements .........................................................................................34 ARTICLE 12 MORTGAGEES .....................................................................................................34

12.1 Encumbrances on the Property .......................................................................................34

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Packet Pg. 696 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second iii
ARTICLE 13 TRANSFERS AND ASSIGNMENTS ...................................................................36

13.1 Transfers and Assignments .............................................................................................36

13.2 Release Upon Transfer ....................................................................................................36 ARTICLE 14 INDEMNITY TO CITY .........................................................................................36

14.1 Indemnity ........................................................................................................................36

14.2 City’s Right to Defense ...................................................................................................37 ARTICLE 15 GENERAL PROVISIONS......................................................................................37

15.1 Notices ............................................................................................................................37

15.2 Entire Agreement; Conflicts ...........................................................................................38

15.3 Binding Effect .................................................................................................................38

15.4 Agreement Not for Benefit of Third Parties ...................................................................38

15.5 No Partnership or Joint Venture .....................................................................................38

15.6 Estoppel Certificates .......................................................................................................38

15.7 Time ................................................................................................................................39

15.8 Excusable Delays ............................................................................................................39

15.9 Governing Law ...............................................................................................................40

15.10 Cooperation in Event of Legal Challenge to Agreement ................................................40

15.11 Attorneys’ Fees ...............................................................................................................40

15.12 Recordation .....................................................................................................................41

15.13 No Waiver .......................................................................................................................41

15.14 Construction of this Agreement ......................................................................................41

15.15 Other Governmental Approvals ......................................................................................41

15.16 Jurisdiction and Venue ....................................................................................................42

15.17 Exhibits ...........................................................................................................................42

15.18 Counterpart Signatures ....................................................................................................43

15.19 Certificate of Performance ..............................................................................................43

15.20 Interests of Owner ...........................................................................................................43

15.21 Operating Memoranda ....................................................................................................43

15.22 Acknowledgments, Agreements and Assurance on the Part of Owner ..........................43

15.23 Waiver of Protest ............................................................................................................44

15.24 Not a Public Dedication ..................................................................................................44

15.25 Other Agreements ...........................................................................................................44

15.26 Severability and Termination ..........................................................................................44

15.27 Community Development Director Approval ................................................................45

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Packet Pg. 697 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second iv

15.28 City Manager Approval ..................................................................................................45 Exhibit “A” Legal Description of Property
Exhibit “B” Digital Display Plans
Exhibit “C” SMMC Article 9 (Planning and Zoning)
Exhibit “D” Conditions of Approval
Exhibit “E” Permitted Fees and Exactions
Exhibit “F” Form of Assignment and Assumption Agreement Exhibit “G” Digital Display District Ordinance
Exhibit “H” Advertising Content Standards

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Packet Pg. 698 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 1 DEVELOPMENT AGREEMENT
This Development Agreement (“Agreement”), dated ____________, 2026, is entered into by and between UNITED XYZ LLC, a California limited liability company (the “Owner”) and the CITY OF SANTA MONICA, a municipal corporation organized and existing pursuant to the laws of the State of California and the Charter of the City of Santa Monica (the “City”), with reference to the following facts:

RECITALS
A. Pursuant to California Government Code Section 65864 et seq. and Chapter 9.60 of the Santa Monica Municipal Code (collectively, the “Development Agreement Statutes”), the City is authorized to enter into binding development agreements with persons or entities having a legal or equitable interest in real property for the development of such real property.

B. Owner is the owner of approximately 14,998 square feet of land located in the City of Santa Monica, State of California, commonly known as 301 Arizona and 1253 Third Street Promenade, as more particularly described in Exhibit “A” attached hereto and incorporated herein by this reference (the “Property”).

C. The Property is developed with an existing approximately 31,560 square foot commercial building that is occupied with commercial (retail and office) uses (the “Existing Building”).

D. The City has included the Property within the Downtown Core land use designation under the City’s 2010 Land Use and Circulation Element of its General Plan (the “LUCE”). The Property is in the Bayside Conservation “BC” (Promenade) District under the Downtown Community Plan (“DCP”) and is located within the Bayside Conservation “BC” (Third Street Promenade Area) designation under the City’s Zoning Ordinance, and is located within the boundaries of the Digital Display District. The Property is also located in the California Coastal Zone.

E. The City and Owner desire to allow Owner to install, operate, maintain, and repair a high-quality LED digital display and associated sign structure (the “Digital Display”) on the Existing Building for displaying paid static or full motion on-premises and/or off-premises advertising, artistic creations, civic announcements of public interest or importance and content promoting the City and/or its rich history, including Downtown Santa Monica and the Third Street Promenade. The operation of the Digital Display will generate revenues for the City through the Community Benefit Payment set forth in this Agreement.

F. Owner has advised the City of Owner’s intent to allow a third party billboard operator to operate and own, lease, or license the Digital Display from Owner during the term of this Agreement.

G. On November 21, 2024, Owner filed an application for a Development Agreement (24ENT-0233), pursuant to Santa Monica Municipal Code (“SMMC”) Section

9.60.020 (the “Development Application”). The Development Application proposes an

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Packet Pg. 699 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 2 approximately one thousand (1,000) square foot full motion, animated Digital Display to be installed on the Existing Building.

H. The design of the Digital Display is more particularly depicted on the Digital Display Plans dated November 18, 2025 and attached hereto as Exhibit “B” (the “Digital Display Plans”).

I. Owner has paid all necessary costs and fees associated with the City’s processing of the Development Application and this Agreement.

J. The primary purpose is to allow for a Digital Display on the Property to (1) create a visually stimulating and informative experience at the corner of Arizona Avenue and the 1200 block of the Promenade; (2) promote the City, including the Third Street Promenade, and the arts, attract visitors and patrons to the Promenade; (3) complement the City’s Entertainment District; as well as (4) generate a new source of revenue for the City. The Parties desire to enter into this Agreement in conformance with the Development Agreement Statutes in order to achieve the development of the Digital Display on the Property.

K. The Digital Display is also consistent with and implements numerous LUCE and DCP goals and policies including:
 LUCE Goal D1 - “Maintain Downtown’s competitive advantage as a premier local and regional shopping, dining, and entertainment destination, and support its evolution in order to respond to changing market conditions.”  LUCE Goal E1 - “Create an economic base that satisfies the commercial service needs of the City’s residents while providing employment opportunities and a strong fiscal infrastructure for the City.”
 LUCE Goal E4 - “Support the retail sector in order to provide for the needs of local residents and visitors and augment sales tax revenues.”  LUCE Policy E1.1 – “Make land use decisions that respond to changing market conditions and meet the needs of City residents and visitors.”  LUCE Policy E4.6 - “Support Downtown as Santa Monica’s primary destination for comparison retail, including a mix of local, national and international shops and restaurants that serve residents, visitors and area employees.”  DCP Goal CCP2 - “Downtown continues to be a thriving and diverse economic force that supports the city’s vitality, fiscal stability and high levels of community services.”
 Goal CCP5: The Third Street Promenade continues to anchor the Downtown’s retail and public space experience with updated features and activities.

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Packet Pg. 700 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 3  Policy CCP5.1 New public art should be encouraged and located to enhance the pedestrian experience and create an immersive arts experience.  Action CCP5.1A Install Pathway Art, Banners and Urban Design Features to support the walking experience and to promote awareness of Downtown’s cultural offerings.
 Policy CCP5.2 Consider opportunity for negotiated development agreement art contributions to be aggregated in order to facilitate the acquisition of significant public art pieces.
 DCP Goal LU3 - “Santa Monica’s Downtown continues to be the economic center for the City, providing a diverse and flexible mix of uses that can meet future resident, business and visitor demand.”
 “The Bayside Conservation district is considered the pedestrian and economic heart of the City. Anchored by the Third Street Promenade, it is a vibrant urban atmosphere supported by a broad mix of building types, office space, entertainment, retail, restaurants, cafes, salons and exercise studios. The DCP supports the continued expansion of the central retail district by increasing the energy and pedestrian traffic on streets around the Promenade.” (DCP p. 22-23.) L. The City Council has determined that a development agreement is appropriate for the proposed development of the Digital Display on the Property. This Agreement will (1) eliminate uncertainty in planning for the Digital Display and result in the orderly development of the Digital Display in accordance with the Digital Display District Ordinance, (2) assure installation of necessary improvements on the Property, (3) provide for public infrastructure and services appropriate to development of the Digital Display, (4) secure for the City improvements that benefit the public, (5) ensure the provision of community benefits as envisioned in the LUCE , DCP, and the Digital Display District Ordinance, and (6) otherwise achieve the goals and purposes for which the Development Agreement Statutes were enacted.

M. This Agreement is consistent with the public health, safety, and welfare needs of the residents of the City and the surrounding region. The City has specifically considered and approved the impacts and benefits of the development of the Digital Display on the Property in accordance with this Agreement. The Digital Display will provide a number of significant project and community benefits as set forth in Section 2.5 of this Agreement.

N. The City Council has found that the provisions of this Agreement are consistent with the relevant provisions of the City’s General Plan, including the LUCE, the DCP, the Digital Display District Ordinance, and the 1992 LUP.

O. On October 29, 2025, the City's Planning Commission held a duly noticed public hearing on the Development Application and this Agreement, and at such hearing, the Planning Commission recommended that the City Council approve the Digital Display including this Agreement.

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Packet Pg. 701 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 4 P. On December 16, 2025, the City Council held a duly noticed public hearing on the updated Development Application and this Agreement, and at such hearing the City determined the Digital Display is exempt from the California Environmental Quality Act (“CEQA”) pursuant to a Class 1 exemption (existing facilities) per CEQA Guidelines Section 15301, a Class 3 exemption (new construction or conversion of small structures) per CEQA Guidelines Section 15303, a Class 11 exemption (accessory structures) per CEQA Guidelines Section 15311, and a Class 32 categorial exemption (in-fill development) per CEQA Guidelines Section 15332 and introduced for first reading Ordinance No. _______________ approving this Agreement.

Q. On ___________, 2026, the City Council adopted Ordinance No. _______________ approving this Agreement.

NOW THEREFORE, in consideration for the covenants and conditions hereinafter set forth, the Parties hereto do hereby agree as follows:

ARTICLE 1

DEFINITIONS
Capitalized terms not defined below shall have the meanings set forth in the City’s Zoning Ordinance. The terms defined below, whether capitalized or not, have the meanings in this Agreement as set forth below unless the Agreement expressly requires otherwise:

1.1 “1992 LUP” means the Coastal Land Use Plan in effect as of the Effective Date unless otherwise indicated in this Agreement.

1.2 “Agreement” means this Development Agreement.

1.3 “Annual Gross Revenues” means Gross Revenues received in a calendar year.

1.4 “Building Permit” means any permit required by SMMC Section 8.08.050(a) and any successors thereto.

1.5 “Business Day” means a business working day for City Employees.

1.6 “Calendar Quarter” means the periods between and including (a) January 1st and March 31st, (b) April 1st and June 30th, (c) July 1st and September 30th, and (d) October 1st and December 31st of any calendar year.

1.7 “City Council” means the City Council of the City of Santa Monica, or its designee.

1.8 “City Manager” means the City Manager or his or her designee.

1.9 “Community Development Director” means the Community Development Department Director of the City of Santa Monica, or his or her designee.

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Packet Pg. 702 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 5 1.10 “Days” means calendar days.

1.11 “DCP” has the meaning set forth in Recital “D”.

1.12 “Digital” means of, relating to, or utilizing devices constructed or working by the methods or principles of electronics. “Digital” also means composed of data in the form of especially binary digits.

1.13 “Digital Display” means a display utilizing digital technology with a display face to broadcast a message containing static or animated content, for on and off-premises advertising, including without limitation the Digital Display referenced in Recital “E”.

1.14 “Digital Advertising Services” means advertisement services on the Digital Display, including advertisements in the form of banner advertising, search engine advertising, interstitial advertising, and other comparable advertising services.

1.15 “Digital Display District Ordinance” means Ordinance No. ___________, adopted by the City Council on _________, 2026 and included in Exhibit “G”.

1.16 “Digital Display District” means the Digital Display District identified in the Digital Billboard District Ordinance.

1.17 “Digital Display Commencement Date” means the date a Certificate of Occupancy or final building permit signoff, as applicable, for the Digital Display is/has been issued.

1.18 “Digital Display Plans” mean the plans for the Digital Display that are attached to this Agreement as Exhibit “B”.

1.19 “Discretionary Approvals” are actions which require the exercise of judgment or a discretionary decision, and which contemplate and authorize the imposition of revisions or additional conditions, by the City, including any board, commission, or department of the City and any officer or employee of the City. Discretionary Approvals do not include Ministerial Approvals.

1.20 “Effective Date” has the meaning set forth in Section 9.1 below.

1.21 “General Plan” or “City General Plan” means the General Plan of the City of Santa Monica, and all elements thereof including the LUCE, as of the Effective Date, unless otherwise indicated in this Agreement.

1.22 “Gross Revenues” means income or revenue generated by the Digital Display from all sources, before any expenses (including lease or license payments to Owner) or taxes, computed according to generally accepted accounting principles.

1.23 “Including” means “including but not limited to.”

1.24 “Legal Action” means any action in law or equity.

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Packet Pg. 703 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 6 1.25 “Ministerial Approvals” mean any action which merely requires the City (including any board, commission, or department of the City and any officer or employee of the City), in the process of approving or disapproving a permit or other entitlement, to determine whether there has been compliance with applicable statutes, ordinances, regulations, or conditions of approval. Without limiting the generality of the foregoing, the exercise of duties and/or professional judgment by any City official referenced in SMMC Article 7 (Public Works) and Article 8 (Building Regulations), as amended from time to time, shall be considered a Ministerial Approval.

1.26 “Operator” means the party responsible for operating the Digital Display.

1.27 “Owner” means UNITED XYZ LLC, a California limited liability company or any successor in interest to the Property.

1.28 “Parties” mean both the City and Owner, and “Party” means either the City or Owner, as applicable.

1.29 “Permitted Digital Display Area” means no more than one thousand (1,000) square feet.

1.30 “Person” means an individual, partnership, limited partnership, trust, estate, association, corporation, limited liability company, or other entity, domestic or foreign.

1.31 “SMMC” means the Santa Monica Municipal Code, including the Zoning Ordinance, in effect on the Effective Date unless specifically stated to refer to the Santa Monica Municipal Code as it may be in effect at some other time.

1.32 “Transfer” means the transfer of title to property by the execution of the deed or other instrument.

1.33 “Zoning Ordinance” means the City of Santa Monica Comprehensive Land Use and Zoning Ordinance (Chapters 9.01 to 9.68 of the SMMC) in effect on the Effective Date, set forth in its entirety as part of Exhibit “C” (Planning and Zoning).

ARTICLE 2

DESCRIPTION OF THE DIGITAL DISPLAY

2.1 General Description. The Digital Display includes the proposed improvement of the Property as more particularly described in this Agreement and on the Digital Display Plans, which present the Digital Display in concept. If there is a conflict or inconsistency between the text of this Agreement and the Digital Display Plans, the Digital Display Plans will prevail; provided, however, that omissions from the Digital Display Plans shall not constitute a conflict or inconsistency with the text of this Agreement. Detailed plans and specifications for the construction of the Digital Display (collectively, the “Construction Plans and Specifications”), including, without limitation, structural plans and working drawings, shall be prepared by Owner subsequent to the Effective Date based upon the Digital Display Plans, and nothing herein shall

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Packet Pg. 704 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 7 be interpreted by the Owner as a pre-approval of the Construction Plans and Specifications by the City Building Official or City Engineer.

2.2 Principal Components of the Digital Display. The Digital Display consists of the following principal components, as well as the other components delineated in the Digital Display Plans, all of which are hereby approved by the City subject to the other provisions of this Agreement: an approximately one thousand (1,000) square foot full motion, LED digital/animated display/billboard to be installed as shown on the Digital Display Plans to the façade of the Existing Building. For the avoidance of doubt, modifications to the Existing Building’s ornamental overhang at the top of the second floor to accommodate installation of the Digital Display as shown on the Digital Display Plans are part of the Digital Display being approved as part of this Agreement and shall not require further design approval. The Digital Display may display static or full motion animated illuminated/digital content seven Days per week including paid on-premises and/or off-premises advertising, public service content, artwork, civic announcements, charitable content and, as detailed in Section 2.5, content promoting the City, including Downtown Santa Monica and the Third Street Promenade, and other City content. The Digital Display may display such illuminated/digital content during the hours specified in the Digital Display District Ordinance.

2.3 No Obligation to Develop.

2.3.1 Except as specifically provided herein:
(a) Nothing in this Agreement shall be construed to require Owner to proceed with the construction of the Digital Display.
(b) The decision to proceed or to forbear or delay in proceeding with construction of the Digital Display shall be in Owner’s sole discretion. (c) Except as provided in this Agreement, the decision to proceed or to forbear or delay in proceeding with construction of the Digital Display shall be in Owner’s sole discretion.

2.3.2 Failure to Proceed. Failure by Owner to proceed with construction of the Digital Display shall not result in any loss or diminution of development rights for the Digital Display, except upon expiration of Owner’s Vested Rights pursuant to this Agreement, or the termination of this Agreement.

2.3.3 Conditions of Approval. Notwithstanding any provision of this Section 2.3 to the contrary, Owner shall be required to implement all conditions of approval required under this Agreement in accordance with and at the time specified in Exhibit “D” and may be subject to all remedies specified in this Agreement for the failure to implement these conditions of approval as and when so required.

2.4 Vested Rights.

2.4.1 Approval of Digital Display Plans. The City hereby approves the Digital Display Plans as the conceptual scope of the Digital Display. The City shall maintain a complete copy of the Digital Display Plans, stamped “Approved” by the City, in the Office of the City

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Packet Pg. 705 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 8 Clerk, and Owner shall maintain a complete copy of the Digital Display Plans, stamped “Approved” by the City, in its offices or at the Property. The Digital Display Plans to be maintained by the City and Owner shall be in a half-size set.

2.4.2 Minor Modifications to Digital Display. Owner, with the approval of the Community Development Director, may make minor changes to the Digital Display or Digital Display Plans (“Minor Modifications”) without amending this Agreement; provided that the Community Development Director makes the following specific findings that the Minor Modifications: (i) are generally consistent with the Digital Display’s overall qualities and characteristics as approved by the City Council; (ii) are consistent with the provisions, purposes and goals of this Agreement; (iii) are not detrimental to the public health, safety, convenience or general welfare; (iv) are consistent with the LUCE, DCP, and Digital Display District Ordinance; and (v) will not significantly and adversely affect the project and community benefits (Section

2.5) associated with the Digital Display, unless expressly authorized in Section 2.5. For the avoidance of doubt, any Minor Modification approving an increase or decrease in the square footage in a Digital Display shall document the proportionate increased or decreased One-Time Community Benefit and MAG Contribution in compliance with the Digital Display District Ordinance then in effect. The Community Development Director shall notify the Planning Commission and City Council in writing of any Minor Modifications approved pursuant to this Section 2.4.2. Any proposed change which the Community Development Director denies as not qualifying for a Minor Modification based on the above findings will only be processed as a Major Modification.

2.4.3 Modifications Requiring Amendment to this Agreement. Owner shall not make any “Major Modifications” (defined below) to the Digital Display without first amending this Agreement to permit such Major Modifications. A “Major Modification” means the following:
(a) Any increase in the square footage above the maximum display area allowed by the Digital Display District Ordinance, as it may be amended from time to time; (b) Any material variation in the design or location of the Digital Display (except as permitted as a Minor Modification pursuant to Section 2.4.2) that renders such aspects out of substantial compliance with the Digital Display Plans after Coastal Commission approval;
(c) Any deviation from the Digital Display District Ordinance, as it may be amended from time to time;
(d) Any other change that would reduce or materially alter the project and community benefits as set forth in Section 2.5, unless expressly authorized in Section 2.5; and
(e) Any extension of the Term beyond the extensions provided for in Section 9.2.5.

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Packet Pg. 706 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 9 If a proposed modification does not exceed the Major Modification thresholds established above, then the proposed modification may be reviewed as a Minor Modification in accordance with Section 2.4.2.

2.4.4 City Consent to Modification. The City may impose customary fees, exactions, and conditions, in connection with its approval of a Minor or Major Modification, subject to any applicable law. Notwithstanding anything to the contrary herein or in the Existing Regulations, if the Community Development Director approves a Minor Modification or if the City approves a Major Modification (and the corresponding amendment to this Agreement for such Major Modification), as the case may be, Owner shall not be required to obtain any other Discretionary Approvals for such modification in the case of certain Major Modifications.

2.4.5 Right to Develop. Subject to the provisions of Section 3.3 below, during the Term (as defined in Section 9.2 below) of this Agreement, Owner shall have the vested rights (the “Vested Rights”) to (a) develop and construct the Digital Display in accordance with the following: (i) the Digital Display Plans (as the same may be modified from time to time in accordance with this Agreement); (ii) any Minor Modifications approved in accordance with Section 2.4.2; (iii) any Major Modifications which are approved pursuant to Section 2.4.3; and (iv) the requirements and obligations of Owner related to the improvements which are specifically set forth in this Agreement, and (b) operate the Digital Display pursuant to the terms of this Agreement and through the Term of this Agreement. The City shall have no further discretion over the elements of the Digital Display which have been delineated in the Digital Display Plans (as the same may be modified from time to time in accordance with this Agreement).

2.5 Project and Community Benefits. Set forth below in this Section 2.5 are the project and community benefits that will be provided by the Digital Display.

2.5.1 One-Time Community Benefit Contribution. Within thirty (30) Days of issuance of the Digital Display Commencement Date, Owner shall pay a one-time community benefits contribution to the City in the amount of Five Hundred Thousand Dollars ($500,000) (the “One-Time Community Benefit Payment”). If the One-Time Community Benefit Payment is not made on or before June 30, 2027, then it shall escalate by three percent (3%) on June 30, 2027, and annually by three percent (3%) each June 30 thereafter until it is made.

2.5.2 Ongoing Community Benefit Contribution. Commencing on the Digital Display Commencement Date and continuing for each calendar year during the remainder of the Term, Owner shall pay to the City an amount (the “Ongoing Community Benefit Contribution”) equal to the greater of: (a) the Revenue Share Contribution (as set forth in subsection (a) below), and (b) the applicable MAG Contribution (as set forth in subsection (b) below).
(a) Revenue Share Contribution. Owner shall pay to the City (“Revenue Share Contribution”) an amount equal to twenty percent (20%) of the Annual Gross Revenues received for Digital Advertising Services. Such Revenue Share Contribution shall be

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Packet Pg. 707 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 10 paid annually to the City in accordance with Section 2.5.2(d) below.
(b) Minimum Annual Guaranteed Contribution. Beginning on the Digital Display Commencement Date and in accordance with the timing specified in Section 2.5.2(c) below, Owner shall pay to the City a minimum annual guaranteed payment (the “MAG
Contribution”) equal to Five Hundred Thousand Dollars
($500,000), which amount shall escalate by three percent (3%) commencing on June 30, 2027, and annually by three percent (3%) each June 30 thereafter.

Notwithstanding the foregoing, if the City approves more than nine (9) digital displays in the Digital Display District, as it may be amended from time to time, then commencing with the first quarterly MAG Contribution after such additional digital display’s Digital Display Commencement Date, the MAG Contribution otherwise due under this Agreement shall be reduced by three percent (3%) per digital display exceeding nine (9) (e.g., 3% reduction at the Digital Display Commencement Date for the 10th digital display, additional 3% reduction at the Digital Display Commencement Date for the 11th digital display, etc.).

Notwithstanding anything to the contrary herein, in no event will the City be required to pay or refund any sum to Owner as a result of the MAG Contribution reduction.
(c) Timing of MAG Contribution. Commencing with the Digital Display Commencement Date, the MAG Contribution shall be paid quarterly in arrears to City on or before the thirtieth (30th) day following the expiration of each Calendar Quarter during the Term and shall be prorated for any partial Calendar Quarter based on the number of Days within such time period. Concurrent with payment of the MAG Contribution, Owner shall submit confirmation in writing of the amount of the MAG Contribution paid and
documenting any increases/decreases in the MAG Contribution compared with the prior quarterly MAG Contribution payment including citations to the relevant section of this Agreement supporting any such increase/decrease (e.g. 2.5.2(g) late payment,

2.5.4 failure to meet occupancy threshold, 2.5.2(b) saturation,

2.5.2(h) abatement credit, 3.6 temporary removal) and any relevant documentation.
(d) Revenue Share Contribution Timing. The Revenue Share Contribution shall be paid annually in arrears no later than fortyfive (45) Days following the end of the year to which the Revenue Share is attributable (the “Reconciliation Payment Date”). No later than the Reconciliation Payment Date, Owner shall submit to

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Packet Pg. 708 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 11 the City a statement of the Revenue Share Contribution calculation for the immediately preceding year (January 1-December 31) along with a reconciliation statement (collectively, the “Reconciliation Statement”), reflecting the calculation of the Revenue Share Contribution due and owing for such calendar year (the “Annual Reconciliation”). If the amount of Revenue Share Contribution payable by Owner set forth in the Reconciliation Statement is more than the amount of MAG Contribution actually paid by Owner for such year (including any Supplemental MAG, if applicable), Owner shall pay the difference between the Revenue Share Contribution and the MAG Contribution (including any
Supplemental MAG, if applicable) paid to the City concurrently with the submission of the Reconciliation Statement for that year. (e) Statements of Annual Gross Receipts; Reconciliation Statement.

The Reconciliation Statement shall be accompanied by the signed certificate of the designated representative of the Owner, certifying specifically that (i) such report presents fairly and accurately reflects the Annual Gross Revenues of the calendar year, and (ii) the said Annual Gross Revenues conform with and are computed in compliance with the definition of Annual Gross Revenues. (f) Records. For the purpose of permitting verification by City of any amount due to City as Revenue Share Contribution, Owner shall keep and preserve, or cause to be kept and preserved by Operator, for at least three (3) years after each calendar year as to such calendar year, and during the Term shall keep at the Property or at Operator’s premises at a designated location in Los Angeles County, a general ledger, required receipts and disbursement journals, and such sales records and other supporting
documentation together with original or duplicate books and records which shall disclose in detail all information required to permit City to verify Gross Revenues and which shall conform to and be in accordance with generally accepted accounting principles consistently applied. Not more than two (2) times per calendar year, after five (5) Business Days advance written notice to Owner or Operator, City or its employees, agents and/or accountants, shall have the right during business hours to make an examination or audit and copy of such books and records relevant to the determination of Gross Revenues (which examination may be conducted physically at the Property or Operator’s premises in Los Angeles County or by Owner or Operator making available such books and records by electronic means). If such audit discloses that, in any calendar year, the Revenue Share Contribution owed to City is greater than the Revenue Share Contribution paid to City for such period, Owner shall pay to City, within ten (10) Days of notice thereof accompanied by reasonable documentary evidence

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Packet Pg. 709 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 12 thereof, such liability. In addition, if such audit shall disclose that Owner has underpaid by four percent (4%) or more any Revenue Share Contribution payable by Owner, then in such event, within ten (10) Days following written notice by City of the costs of such audit and amount due of the Revenue Share Contribution plus interest accompanied by reasonable documentary evidence thereof, Owner shall pay the cost of such audit, all Revenue Share Contribution then payable, plus interest as set forth in subparagraph (g), below, on such the amount of Revenue Share Contribution owed, calculated from the date such additional Revenue Share Contribution was originally due and payable. In the event Owner fails to pay the costs of audit, Revenue Share Contribution due and interest thereon, within the ten (10) calendar day period specified herein, then such failure shall constitute a Default, as that term is defined in Article 11.
(g) Late Payment. If any installment of the MAG Contribution (including any Supplemental MAG, if applicable) and/or Revenue Share Contribution is not received by City within five (5) Business Days after Owner’s receipt of written notice of such delinquency, then Owner shall pay to City a late charge equal to five percent (5%) of the overdue amount, plus interest on the unpaid amount at five percent (5%) per annum pro rated daily for the delinquency period until paid.
(h) Impairment of Use.
(1) Abatement Event. Subject to the provisions herein, Owner may receive a pro rated daily abatement credit (for the period described in Section 2.5.2(h)(5) below) against the MAG Contribution due to (i) any improvements, landscaping,
vegetation, signage or structures installed or placed by City in the public sidewalks or public right of way after the Effective Date of this Agreement, (ii) utility services necessary to operate the Digital Display being interrupted for a period exceeding two (2) Business Days and such interruption is not caused by the acts or omissions of Owner or any tenant on the Property, which utility services may include, but are not limited to, electric, data, and/or internet service, (iii) commencement of an eminent domain proceeding by City or (iv) the use of the Digital Display or the visibility of the Digital Display are materially impaired as a result of (x) the City’s failure to perform any of its obligations under this Agreement (y) any act, event or condition listed under Section 15.8.1 below, or (z) the acts or omissions of any third party but not

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Packet Pg. 710 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 13 those of Owner, Operator, or any other tenant on the Property (each individually or collectively constituting an “Abatement Event”).
(2) Abatement Harm. If an Abatement Event occurs, then
abatement shall only apply if the visibility of the Digital Display has been substantially and materially impaired, which results in material adverse impact on Owner’s or Operator’s ability to sell advertisements on the Digital Display or collect revenues from sold advertisements (“Abatement Harm”), as evidenced by any advertiser (whether subject to an advertising contract with Owner or a potential future advertiser or any Operator), rejecting the Owner or Operator’s proof of
performance in the form of photos, canceling such advertising contract or declining to renew or extend advertising time on the Digital Display, or an advertiser declining to purchase advertising time on the Digital Display in each case, directly as a result of the Abatement Event.
(3) Notice of Abatement Event. In the event of any claim by Owner for abatement due to an Abatement Event, Owner shall provide written notice to the City no later than ten (10) Days upon learning of the alleged commencement of the Abatement Event. Owner and City shall meet and confer within five (5) Business Days of City’s receipt of the notice from Owner. (4) Documentation of Abatement Event and Abatement Harm.

Prior to meeting and conferring with the City and as a precondition to receiving any abatement, Owner shall provide a certified claim statement (“Certified Claim”), signed by the designated representative of the Owner, certifying (i) the detailed nature of the claimed Abatement Event and Abatement Harm, (ii) that such claimed impairment will have a material and substantial impact on the revenue generation of the Digital Display and (iii) providing documentation of the Abatement Event and the Abatement Harm, including but not limited to photos and any advertiser communications evidencing a
rejection of the proof of performance, exercising a right of cancellation or refusal to renew, or an advertiser declining to purchase advertising time on the Digital Display due to the Abatement Event (“Claim Documentation”).
(5) Abatement Period. The abatement of the MAG Contribution as permitted by this Section shall commence upon the date Owner provides notice to the City as required by Section 2.5.2(h)(4) and continue so long as the Abatement Harm continues due to the Abatement Event (“Abatement Period”).

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Packet Pg. 711 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 14 (6) Abatement Credit Timing. Owner understands, acknowledges and agrees that Owner has no right to withhold the MAG
Contribution until and unless the meet and confer period has been completed, and the Owner has provided the Certified Claim and Claim Documentation to City, after which point the City reserves all rights to protest and/or dispute the Certified Claim, or any portion thereof, and exercise its rights under and in accordance with Article 11. The daily abatement credit in this Section 2.5.2(h) shall be applied to the next MAG
Contribution for the Abatement Period. For the avoidance of doubt, (i) the abatement of the MAG Contribution during the Abatement Period shall in no way reduce or abrogate Owner’s obligation to pay City the Revenue Share Contribution in accordance with Section 2.5.2, and (ii) the Abatement Credit shall be deducted from the applicable MAG Contribution and the Owner shall pay City an amount equal to the greater of the Revenue Share Contribution and the MAG Contribution as
adjusted.
(7) Parties’ Collaboration on Abatement Cure. During the meet and confer period provided in subparagraph (h)(3), the Parties shall discuss how to best mitigate and cure the Abatement Event to minimize scope and duration of the Abatement Harm and, if the Abatement Event is attributable to the City under subparagraphs (h)(1)(i), (h)(1)(iii), and (h)(1)(iv)(x), City shall use reasonable good faith efforts to assist with curing such Abatement Event.
(8) No Right to Abatement Attributable to Owner’s Actions.

Notwithstanding any provisions to the contrary, Owner shall have no right to abatement for impairment of use under
subparagraph (h) that are attributable to Owner, Operator, or any other tenant on the Property, including, without limitation, in the event of Owner’s Existing Building repairs, remodeling, reconstruction or redevelopment which is separately governed by Section 3.6.
(9) No City Obligation to Undertake Landscaping Above and Beyond Customary Level of Services. Notwithstanding
anything to the contrary in this Agreement, City has no obligation to provide any public services above and beyond the customary level of services provided by City in the vicinity of the Digital Display as of the Effective Date, including, without limitation, tree trimming.

(i) Breach or Default. Without limiting the generality of Article 11, events of Breach or Default shall include: (i) Owner’s failure to pay any amounts owed to City within fourteen (14) Days of when

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Packet Pg. 712 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 15 due; (ii) Owner’s failure to provide a Reconciliation Statement within fourteen (14) Days of when due; (iii) an audit by City disclosing an underpayment to City of more than four percent (4%); and (iv) City’s inability to perform an audit in accordance with generally accepted auditing standards because Owner has failed to maintain records and/or provide access in accordance with this Agreement. Nothing in this Section modifies the notice and cure provisions in Article 11 applicable to events of Breach or Default.
(j) Public Records Act Request. As the Reconciliation Statement and/or other information provided by Owner to the City pursuant to this Agreement may contain confidential and/or propriety financial information and/or trade secrets, City agrees it shall notify Owner upon receipt of a Public Records Act (Gov’t Code Sections 7920, et seq.) request pertaining to any Reconciliation or other financial documents provided by Owner pursuant to this Agreement and shall not provide access to any such documents to the requesting party or any members of the public unless and until the City has notified Owner in writing of the request and provided Owner with at least ten (10) Days to object to disclosure of such documents on the basis such information is exempt from disclosure under the Public Records Act. If Owner notifies the City in writing of such an objection within the ten (10) day period, then City shall not provide such documents to the requesting party or any other member of the public except in the event of a court order and provided Owner fully indemnifies and defends the City in any litigation related to the withholding of such documents. Nothing in this Agreement shall constitute a waiver or diminishment of any of the exemptions to disclosure provided in the California Public Records Act or other law.

2.5.3 City and Art Content Allocation. Owner shall provide for the display of “City Content Allocation” in accordance with Digital Display District Ordinance. (a) Flexible Use. Any of the City Content Allocation not used by the City may, in the City’s sole discretion, be relinquished back to Owner at no cost so that Owner may, at its sole discretion, either (1) make it available for paid advertising or (2) display non-City art and civic and/or charitable programming. If used for paid advertising, revenue generated shall be considered as part of the Annual Gross Revenues.
(b) Reporting and Recordkeeping. On an annual basis prior to or concurrent with delivery of the Reconciliation Statement, the Owner shall provide the City Manager with a report demonstrating compliance with the City Content Allocation as specified in this Section 2.5.3 for the prior calendar year. The annual City Content Allocation report will include playback logs sourced from the content management system used to operate the Digital Display. The playback logs will indicate times and durations of all the various paid advertising and all other non-commercial content that has been displayed over the past year, as well as a

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Packet Pg. 713 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 16 cumulative summary of all commercial and non-commercial content displayed over that timeframe. The playback logs shall be retained by Owner or its third-party advertising Operator for a minimum of three (3) years following the conclusion of the calendar year to which such records pertain.

2.5.4 Existing Building Occupancy.
(a) Occupancy Threshold. Beginning on the Digital Display Commencement Date, if either (i) more than fifty percent (50%) of the rentable floor area within the Existing Building or (ii) the entire ground floor level of the Existing Building ("Occupancy Threshold") remains unoccupied for more than twelve (12) consecutive months during the Term, then for the period commencing on the first (1st) day following such twelve (12) month period and ending on the first (1st) day thereafter that the occupancy level of the Existing Building satisfies the Occupancy Threshold (“Occupancy Threshold Period”), the MAG Contribution shall be increased by twenty-five percent (25%) (non-compounded) on a daily prorated basis during the Occupancy Threshold Period (“Supplemental MAG Contribution”).

Any late payments of the Supplemental MAG Contribution shall be subject to Section 2.5.2(g).

Except as provided in subparagraph (c) with respect to floor area leased to a tenant in effect as of the Effective Date, “occupied” for purposes of this Section 2.5.4 means rentable floor area in the Existing Building that is physically occupied by a tenant (not vacant) and open for business based upon the tenant’s occupancy classification.
(b) Payment of Supplemental MAG Contribution. The Supplemental MAG Contribution shall be applied to the next MAG Contribution following the commencement of the Occupancy Threshold Period. For the avoidance of doubt, the payment of the Supplemental MAG Contribution shall in no way reduce or abrogate Owner’s obligation to pay City the Revenue Share Contribution in accordance with Section 2.5.2. (c) Deferment of Commencement of Occupancy Threshold Period. In the event that the occupancy level of the Existing Building is beneath the Occupancy Threshold and the Owner is using reasonable good faith efforts to cause the occupancy level of the Existing Building to satisfy the Occupancy Threshold (and has provided City with reasonable supporting documentation of such commercially reasonable efforts), then the City Manager may provide up to one twelve (12) month extension before the Supplemental MAG Contribution is owed to City.

Moreover, rentable floor area in the Existing Building shall not be deemed unoccupied for the purposes of this paragraph if (A) such floor area is leased to a tenant under a lease that existed as of the Effective Date, (B) such lease prevents the tenant from being held in default solely for ceasing operations, provided other lease terms (e.g., rent payments) are fulfilled, and (C) such non-continuous operation provision (or similar) is the primary reason that Owner has not terminated such lease in order to place a new tenant into such floor area. (d) Major Repair, Remodeling or Reconstruction. During any period that any major repair, remodeling or reconstruction is being undertaken with respect to the Existing Building, which prevents occupancy of the building by one or more commercial tenants during the period of such major repair, remodeling or reconstruction, the occupancy level of the Existing Building shall be deemed to satisfy the Occupancy Threshold, regardless of the actual occupancy level of the Existing Building during such period, provided that the repair, remodeling or reconstruction is proceeding with due diligence under an active Building Permit

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Packet Pg. 714 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 17 and in no event for longer than a period of eighteen (18) months, which time can be extended by the City Manager based on substantial evidence that the failure to achieve the Occupancy Threshold is based on any of the events occurring under Section 15.8.1. The eighteen (18) month period shall begin to run from the date that the Owner obtains an active and valid building permit that has been issued by the City to undergo the applicable repair, remodeling or reconstruction.

The occupancy level of the Existing Building shall also be deemed to satisfy the Occupancy Threshold, regardless of the actual occupancy level of the Existing Building during such period that Owner has active and valid permits that have been issued by the City for the Existing Building to undergo mandatory seismic strengthening required under the City’s Seismic Retrofit Ordinance, or other work necessary to comply with any applicable laws or regulations implemented following the Effective Date, provided that the work is being diligently pursued, as determined by the City Manager or designee.
(e) The Supplemental MAG Contribution is the City's sole and exclusive remedy for the failure to meet the Occupancy Threshold and failure to satisfy the Occupancy Threshold shall not constitute a Default by Owner so long as Owner is paying the increased MAG Contribution required by subsection (a). Notwithstanding the foregoing remedy, (i) if the occupancy level of the Existing Building is beneath the Occupancy Threshold for more than (3) consecutive years during the Term, City may as an alternative sole and exclusive remedy, subject to the notice and cure provisions of Article 11, obligate Owner to shut off the Digital Display until such time as the Occupancy Threshold is met and (ii) if the occupancy level of the Existing Building is beneath the Occupancy Threshold for more than five (5) consecutive years during the Term and the Owner does not demonstrate good faith efforts to lease rentable floor area or entire ground floor area of the Existing Building, City may, subject to the notice and cure provisions of Article 11, terminate this Agreement. (f) On an annual basis concurrent with delivery of the Reconciliation Statement, Owner shall notify the City in writing whether the Occupancy Threshold is satisfied, and if it is not satisfied, the date the Existing Building first failed to satisfy the Occupancy Threshold. In addition, concurrent with delivery of the quarterly MAG Contribution required in Section 2.5.2, if any rentable floor area has become unoccupied since payment of the last quarterly MAG Contribution, Owner shall notify the City Manager of the date the floor area became unoccupied.

2.5.5 Content. Owner agrees that the Digital Display shall comply with the Advertising Content Standards in Exhibit “H”.”

2.6 Maintenance and Upgrades. After the Building Official’s final approval or signoff, as applicable, for the Digital Display and for as long as the Digital Display is in place, Owner shall maintain the Digital Display (including its support structure) in safe, attractive and good condition, clean and free of graffiti. In the event the Digital Display malfunctions or becomes damaged or otherwise requires repair, Owner shall complete the needed repair as soon as practicable and in any event respond within one (1) Business Day after receiving notice from the City of the need for maintenance. Provided that any such repair work is limited to the Digital Display itself or its entablature, no City approvals will be required. In addition, Owner may replace, update, or upgrade all or any portion of the Digital Display provided that (a) the size and orientation of the Digital Display are not altered and (b) the Digital Display complies with the Digital Display District Ordinance. Any modifications proposed as part of the replacement,

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Packet Pg. 715 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 18 update or upgrade of the Digital Display shall be reviewed under Sections 2.4.2-2.4.4 and/or Article 6, as applicable.

2.7 Removal of Digital Display. At the end of the Term of this Agreement (or if this Agreement is terminated earlier pursuant to this Agreement), Owner shall remove the Digital Display and patch/repair the façades of the Existing Building. Notwithstanding the foregoing, Owner shall not be required to remove the Digital Display if Owner and City have entered into an extension of this Agreement or a new agreement regarding the continued operation of the Digital Display on the Property. Further, Owner shall not be required to remove the Digital Display for up to six (6) months following such expiration or termination if Owner and the City are in reasonable good faith negotiations to enter into a new agreement regarding the operation of the Digital Display and the City Manager has approved such non-removal.

2.8 Projections, Design, and Operation Standards.
(a) Projections from the Existing Building, design, and operation of the Digital Display shall conform to the Digital Display District Ordinance. (b) Exemption From City Sign Code. For avoidance of doubt, the Digital Display shall be exempt from the City’s Sign Code (SMMC Chapter 9.61).

2.9 Coastal Commission Review. After the Effective Date of the Development Agreement, the Community Development Director, or his or her designee, shall provide Owner with a fully completed and executed Section 2 of the Local Agency Review Form (Appendix B of the Coastal Development Permit Application) and shall stamp and return to Owner two sets of Digital Display Plans within 15 Days after receiving such a written request and the associated processing fee from Owner.

2.10 Owner Solely Responsible for Compliance with The Terms and Conditions of this Agreement. Owner shall comply with any act or obligation to be performed by or on the part of Owner under the terms of this Agreement or cause Operator to comply with any act or obligation to be performed by or on the part of Owner under the terms of this Agreement, with the same force and effect as if performed by Owner. Operator’s failure to comply with the terms of this Agreement shall not be deemed to excuse Owner’s obligations under this Agreement and City shall have no obligation to seek any remedies against Operator for Operator’s violation of this Agreement, it being understood, acknowledged and agreed to by Owner that Owner is solely responsible for the obligations attributed to Owner under this Agreement.

2.11 Operator Not a Third-Party Beneficiary to this Agreement. Owner understands, acknowledges and agrees that Operator is not a third party beneficiary to this Agreement. As a condition precedent to the Effectiveness of this Agreement, Operator shall acknowledge and consent, on behalf of itself and its successors and assigns, that Operator has no right to claim third party beneficiary status under this Agreement.

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Packet Pg. 716 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 19 2.12 Relationship to Owner/Operator Agreements. Nothing in this Agreement modifies any agreements between Owner and Operator as between themselves, separate and apart from the obligations to the City.

ARTICLE 3

CONSTRUCTION

3.1 [Reserved.]

3.2 Construction Hours. Owner shall be permitted to perform construction related to the Digital Display between the hours of 8:00 a.m. to 6:00 p.m. Monday through Friday, and 9:00 a.m. to 5:00 p.m. Saturday; provided that interior construction work which does not generate noise of more than thirty (30) decibels beyond the Property’s property lines may also be performed between the hours of 7:00 a.m. to 8:00 a.m. and 6:00 p.m. to 7:00 p.m. Monday through Friday, and 8:00 a.m. to 9:00 a.m. and 5:00 p.m. to 6:00 p.m. Saturday. Notwithstanding the foregoing, pursuant to SMMC Section 4.12.110(e), Owner has the right to seek a permit from the City authorizing construction activity during the times otherwise prohibited by this Section.

3.3 Outside Building Permit Issuance Date.
i. Subject to Section 3.5, if Owner has not been issued a building permit for the Digital Display by the “Outside Building Permit Issuance Date” (defined below), then on the day after the Outside Building Permit Issuance Date, without any further action by either Party, this Agreement shall automatically terminate and be of no further force or effect. For purposes of clarity, if Owner has not been issued a building permit for the Digital Display by the Outside Building Permit Issuance Date, the City shall not be required to pursue its remedies under Section 11.4 of this Agreement, and this Agreement shall, instead, automatically terminate. “Outside Building Permit Issuance Date” means the date that is two (2) years after the Effective Date; provided that the Outside Building Permit Issuance Date shall automatically be extended by applicable Excusable Delays and otherwise in accordance with the remainder of this Article 3.
ii. If the approval by the California Coastal Commission of the Digital Display does not occur within six (6) months of the submittal by Owner to the Coastal Commission, then the Outside Building Permit Issuance Date shall automatically be extended one month for each additional month or partial month greater than six (6) that the Coastal Commission approval is delayed. If issuance of the building permit for the Digital Display does not occur within four (4) months of Owner’s submittal of a complete plan check application for the Digital Display and Owner is diligently processing such plan check application, including, without limitation, responding in a timely and responsive manner to City building official comments, then the Outside Building Permit Issuance Date shall automatically be extended one month for each additional month or partial month greater than four (4) that the building permit issuance is delayed.

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Packet Pg. 717 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 20 iii. At any time after the Effective Date but before the Outside Building Permit Issuance Date, Owner may deliver written notice to the Community Development Director, requesting an extension of the Outside Building Permit Issuance Date for an additional twelve (12) months. The Community Development Director shall grant such extension if Owner can demonstrate substantial progress has been made towards obtaining a building permit and show reasonable cause why Owner will not be able to obtain the building permit for the Digital Display by the Outside Building Permit Issuance Date and can demonstrate that: (a) the condition of the Property will not adversely affect public health or safety and (b) the continued delay will not create any unreasonable visual or physical detriment to the neighborhood.

3.4 Construction Period. Construction of the Digital Display shall be completed no later than eighteen (18) months from issuance of the building permit. If a building permit for all or part of the Digital Display expires (e.g., is not timely exercised) or lapses and the Outside Building Permit Issuance Date has not expired, Owner may file for renewal of such building permit or a new/replacement building permit prior to the Outside Building Permit Issuance Date, as it may be extended pursuant to Section 3.3 above.

3.5 Extended Vested Rights. Notwithstanding any other provision of this Agreement, if prior to the Outside Building Permit Issuance Date (as it may be extended) and/or end of the construction period in Section 3.4, Owner pays to the City twenty-five percent (25%) of the MAG Contribution specified in Section 2.5.2(b) prorated on a daily basis (“Partial MAG Payment”), then the Outside Building Permit Issuance Date and/or the construction period specified in Section 3.4, as applicable, shall automatically be extended so long as such Partial MAG Payment continues quarterly up to a maximum of five (5) years from the Effective Date; provided, however, that City shall have, as its exclusive remedy, the right to terminate this Agreement, subject to the notice and cure provisions under Article 11 if the Outside Building Permit Issuance Date extends beyond five (5) years from the Effective Date and/or the construction period specified in Section 3.4 extends beyond three (3) years.

3.6 Existing Building Repairs, Remodeling, Reconstruction or Redevelopment and/or Digital Display Damage. In the event that (a) the Existing Building undergoes a major repair, remodeling, reconstruction or redevelopment that results in or requires removal of the Digital Display or (b) the Digital Display is damaged or destroyed so as to be inoperable during the Term of this Agreement due to actions or events that are outside the reasonable control of the Owner, Operator, or any other tenant on the Property:
i. Owner shall be entitled to reinstall and/or reconstruct the Digital Display in accordance with this Agreement if: (a) the major repair, remodeling, reconstruction or redevelopment that results in or requires removal of any of the Digital Displays is proceeding with due diligence and (b) the Owner is not in Breach of this Agreement. ii. The Term of this Agreement shall toll during the period the Digital Display is removed and shall resume on the date of issuance of a certificate of occupancy (or final building permit signoff, as applicable) for the reconstructed Digital Display by the applicable City building authorities (the “Temporary Removal Period”). For the avoidance of doubt, the MAG Contribution shall continue to escalate in accordance with Section 2.5.2(b) during any Temporary Removal Period.

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Packet Pg. 718 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 21 iii. The MAG Contribution in Section 2.5 shall abate on a day-for-day basis during any Temporary Removal Period. Notwithstanding the foregoing, if at Owner’s election, in its sole discretion, and with City approval, Owner installs temporary scaffolding to allow a temporary substitute for the Digital Display to be installed on the Property during any Temporary Removal Period, Owner shall pay the City ten percent (10%) of Gross Revenues from the temporary substitute display no later than sixty (60) Days from the end of the Temporary Removal Period.

3.7 City Termination Option. Notwithstanding anything in the foregoing to the contrary, in the event the Temporary Removal Period (x) exceeds three (3) years under the circumstances described in Section 3.6(a) (the Existing Building undergoes a major repair, remodeling, reconstruction or redevelopment that requires removal of the Digital Display) and such circumstances are not caused by any act, event or condition listed under Section 15.8.1(a); (y) exceeds six (6) years under the circumstances described in Section 3.6(a) (the Existing Building undergoes a major repair, remodeling, reconstruction or redevelopment that requires removal of the Digital Display) and such circumstances are caused by any act, event or condition listed under Section 15.8.1; or (z) exceeds eighteen (18) months under the circumstances described in Section 3.6(b) (the Digital Display is damaged or destroyed during the Term of this Agreement), then the City may exercise, as its exclusive remedy, the right to terminate this Agreement, subject to the notice and cure provisions under Article 11. Alternatively, if the City does not exercise its right to terminate this Agreement, the Partial MAG Payment shall continue for so long as the City does not exercise the right to terminate.

ARTICLE 4

FEES, EXACTIONS, AND CONDITIONS

4.1 Fees, Exactions, and Conditions. Except as expressly set forth in Section 2.5 (relating to Community Benefits), Section 4.2 (relating to modifications), and Section 5.2 (relating to Subsequent Code Changes) below, the City shall charge and impose only those fees, exactions, conditions, and standards of construction set forth in this Agreement, including Exhibits “D” and “E”, respectively, attached hereto, and no others. If any of the conditions set forth on Exhibit “D” is satisfied by others, Owner shall be deemed to have satisfied such conditions. Notwithstanding the foregoing, except to the extent specifically provided otherwise, this Agreement does not require Owner to pay any exactions nor implement any conditions of approval if Owner does not obtain a building permit for the Digital Display prior to expiration of the Outside Building Permit Issuance Date including any extensions thereof or any tolling thereof in accordance with Section 3.3.

4.2 Conditions on Modifications. The City may impose fees, exactions, and conditions in connection with its approval of Minor or Major Modifications, provided that all fees, exactions, and conditions shall be in accordance with any applicable law.

4.3 Implementation of Conditions of Approval. Owner shall be responsible to adhere to the conditions of approval set forth in Exhibit “D” in accordance with the timelines established in Exhibit "D".

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Packet Pg. 719 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 22 ARTICLE 5

EFFECT OF AGREEMENT ON CITY LAWS AND REGULATIONS

5.1 Development Standards for the Digital Display; Existing Regulations. The following development standards and restrictions set forth in this Section 5.1 govern the use and development of the Digital Display and shall constitute the Existing Regulations, except as otherwise expressly required by this Agreement. Nothing herein shall be deemed to apply to the Existing Building, excluding the Digital Display.

5.1.1 Defined Terms. The following terms shall have the meanings set forth below:
(a) “Existing Regulations” collectively means all of the following which are in force and effect as of the Effective Date: (i) the General Plan (including, without limitation, the LUCE); (ii) the DCP, (iii) the Zoning Ordinance except as modified herein; (iv) the Digital Display District Ordinance; (v) any and all ordinances, rules, regulations, standards, specifications and official policies of the City governing, regulating or affecting the design, development, building, construction, occupancy or use of buildings, signs/billboards, and improvements or any exactions therefore, except as amended by this Agreement; (v) the City’s 1992 LUP; and (vi) the development standards and procedures in Article 2 of this Agreement. (b) “Subsequent Code Changes” collectively means all of the following which are adopted or approved subsequent to the Effective Date, whether such adoption or approval is by the City Council, any department, division, office, board, commission or other agency of the City, by the people of the City through charter amendment, referendum, initiative or other ballot measure, or by any other method or procedure: (i) any amendments, revisions, additions or deletions to the Existing Regulations; or (ii) new codes, ordinances, rules, regulations, standards, specifications and official policies of the City governing or affecting the design, development, construction, occupancy or use of building, signs/billboards, or improvements or any exactions therefor. “Subsequent Code Changes” includes, without limitation, any amendments, revisions or additions to the Existing Regulations imposing or requiring the payment of any fee, special assessment or tax.

5.1.2 Existing Regulations Govern the Digital Display. Except as provided in Section 5.2, development of the improvements that will comprise the Digital Display, including without limitation, the development standards for the design, development, construction, or use of such Digital Display, and any exactions therefore, shall be governed by the Existing Regulations. The City agrees that this Agreement is consistent with the Digital Display District Ordinance, General Plan, including the LUCE and the DCP, and the 1992 LUP. Any provisions of the Existing Regulations inconsistent with the provisions of this Agreement, to the extent of such inconsistencies and not further, are hereby deemed modified to that extent necessary to effectuate the provisions of this Agreement. The Digital Display shall be exempt from: (a) all Discretionary Approvals or review by the City or any agency or body thereof, other than review of modifications to the Digital Display as expressly set forth in Sections 2.4.2 and 2.4.3; (b) the application of any subsequent local sign, billboard, and/or digital display moratoria, sign, billboard, and/or digital display rationing systems or other restrictions on sign, billboard, and/or

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Packet Pg. 720 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 23 digital displays which would adversely affect the rate, timing, or phasing of construction of the Digital Display, and (c) Subsequent Code Changes which are inconsistent with this Agreement.

5.2 Permitted Subsequent Code Changes.
(a) Applicable Subsequent Code Changes. Notwithstanding the terms of Section 5.1, this Agreement shall not prevent the City from applying to the Digital Display the following Subsequent Code Changes set forth below in this Section 5.2(a). Processing fees and charges imposed by the City to cover the estimated actual costs to City of processing applications for development approvals including: (i) all application, permit, and processing fees incurred for the processing of this Agreement, any administrative approval of a Minor Modification, or any amendment of this Agreement in connection with a Major Modification; (ii) all building plan check and building inspection fees for work on the Digital Display in effect at the time an application for a grading permit or building permit is applied for; (iii) the public works plan check fee and public works inspection fee for public improvements constructed and installed by Owner; (iv) fees for monitoring compliance with any development approvals; (v) and utility charges.
(b) General or special taxes, including, but not limited to, property taxes, sales taxes, parcel taxes, transient occupancy taxes, business taxes, which may be applied to the Property or to businesses occupying the Property; provided that (i) the tax is of general applicability City-wide and does not burden the Property disproportionately to other similar developments within the City; and (ii) the tax is not a levy, assessment, fee or tax imposed for the purpose of funding public or private improvements on other property located within the Downtown Community Plan area as of the Effective Date.
(c) Procedural regulations relating to hearing bodies, petitions, applications, notices, documentation of findings, records, manner in which hearings are conducted, reports, recommendations, initiation of appeals, and any other matters of procedure; provided such regulations are uniformly imposed by the City on all matters, do not result in any unreasonable decision-making delays and do not affect the substantive findings by the City in approving this Agreement or as otherwise established in this Agreement. (d) Regulations governing construction standards and specifications which are of general application that establish standards for the construction and installation of structures and associated improvements, including, without limitation, the City’s Building Code, Plumbing Code, Mechanical Code, Electrical Code and Fire Code; provided that such construction standards and specifications are applied on a City-wide basis and do not otherwise limit or impair the Digital Display approvals granted in this Agreement unless adopted to meet (i) health and safety concerns or (ii) in the event of replacement of the Digital Display during the Term, City-wide green building or energy standards clearly applicable to electronic digital displays.
(e) Any City regulations to which Owner has consented in writing, which consent may be withheld by Owner in its sole discretion. (f) Collection of such fees or exactions as are imposed and set by governmental entities not controlled by City but which are required to be collected by City.

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Packet Pg. 721 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 24 (g) Wastewater/water connection fees, including capital facility and construction fees, which are adopted by the City Council from time to time and apply generally throughout the City.
(h) Regulations which do not impair the rights and approvals granted to Owner under this Agreement. For the purposes of this Section 5.2.1(h), regulations which impair Owner’s rights or approvals include, but are not limited to, regulations which (i) materially increase the cost of the Digital Display (except as provided in Section 5.2.1(a), (b), and (d) above), (ii) materially delay development of the Digital Display or would cause a material change in the uses of the Digital Display as provided in this Agreement, or (iii) materially impair the development, operation or use of the Digital Display. (i) Generally applicable codes or actions necessary to comply with a declaration of a Water Shortage Emergency pursuant to the California Water Code.

5.2.2 New Rules and Regulations. This Agreement shall not be construed to prevent the City from applying new rules, regulations and policies in those circumstances specified in Government Code Section 65866.

5.2.3 State or Federal Laws. In the event that state or federal laws or regulations, enacted after the Effective Date, prevent or preclude compliance with one or more of the provisions of this Agreement, such provisions of this Agreement shall be modified or suspended as may be necessary to comply with such state or federal laws or regulations; provided that this Agreement shall remain in full force and effect to the extent it is not inconsistent with such laws or regulations and to the extent such laws or regulations do not render such remaining provisions impractical to enforce.

5.3 Common Set of Existing Regulations. Prior to the Effective Date, the City and Owner shall use reasonable efforts to identify, assemble and copy three identical sets of the Existing Regulations, to be retained by the City and Owner, so that if it becomes necessary in the future to refer to any of the Existing Regulations, there will be a common set of the Existing Regulations available to all Parties.

5.4 Conflicting Enactments. Except as provided in Section 5.2 above, any Subsequent Code Change which would conflict in any way with or be more restrictive than the Existing Regulations shall not be applied by the City to any portion of the Digital Display.

Owner may, in its sole discretion, give the City written notice of its election to have any Subsequent Code Change applied to any portion of the Digital Display as it may have an interest in, in which case such Subsequent Code Change shall be deemed to be an Existing Regulation insofar as that portion of the Digital Display is concerned. If there is any conflict or inconsistency between the terms and conditions of this Agreement and the Existing Regulations, the terms and conditions of this Agreement shall control.

5.5 Timing of Development. The California Supreme Court held in Pardee Construction Co. v. City of Camarillo, 37 Cal.3d 465 (1984), that failure of the parties in that case to provide for the timing of development resulted in a later adopted initiative restricting the timing of development to prevail over the parties’ agreement. It is the intent of Owner and the

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Packet Pg. 722 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 25 City to cure that deficiency by expressly acknowledging and providing that any Subsequent Code Change that purports to limit the installation and/or operation of the Digital Display shall not prevail over this Agreement.

ARTICLE 6

DESIGN APPROVAL
Notwithstanding any provision of the SMMC or any interim zoning ordinance to the contrary, the Digital Display District Ordinance shall set forth the design approval required, if any, for the Digital Display’s design, colors, and/or materials.

ARTICLE 7

CITY TECHNICAL PERMITS

7.1 Definitions. For purposes of this Agreement, the following terms shall have the meanings set forth below:

7.1.1 “Technical City Permits” means any Ministerial Approvals, consents or permits from the City or any office, board, commission, department, division or agency of the City, which are necessary for the actual construction of the Digital Display or any portion thereof in accordance with the Digital Display Plans and this Agreement. Technical City Permits include, without limitation (a) building permits, (b) related mechanical, electrical, plumbing and other technical permits, (c) demolition, excavation and grading permits, (d) encroachment permits, (e) off-site improvement permits, and (f) temporary and final certificates of occupancy.

7.1.2 “Technical Permit Applications” means any applications required to be filed by Owner for any Technical City Permits.

7.2 Diligent Action by City.

7.2.1 Upon satisfaction of the conditions set forth in Section 7.3, the City shall accept the Technical Permit Applications filed by Owner with the City and shall diligently proceed to process such Technical Permit Applications to completion.

7.2.2 Upon satisfaction of the conditions set forth in Section 7.3, the City shall diligently issue the Technical City Permits which are the subject of the Technical Permit Applications.

7.3 Conditions for Diligent Action by the City.

7.3.1 Acceptance and Processing of Technical Permit Applications. The obligation of the City to accept and diligently process the Technical Permit Applications which are filed by Owner for the Digital Display, and then issue the Technical City Permits for the Digital Display, is subject to the satisfaction of the following conditions:

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Packet Pg. 723 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 26 (a) Owner shall have completed and filed all Technical Permit Applications which are required under the administrative procedures and policies of the City which are in effect on the date when the Technical Permit Application is filed; provided that such procedures and policies are uniformly in force and effect throughout the City; and (b) Owner shall have paid all processing and permit fees established by the City in connection with the filing and processing of any Technical Permit Application which are in effect on the date when the Technical Permit Application is filed; provided that such fees are uniformly in force and effect throughout the City.

7.3.2 Issuance of a Technical City Permit. The obligation of the City to issue a Technical City Permit for the Digital Display which is the subject of a Technical Permit Application filed by Owner is subject to the satisfaction of the following conditions (and only such conditions and no others):
(a) Owner shall have complied with all of its obligations under this Agreement, including those in Exhibit “D”, which are required to be performed prior to or concurrent with the issuance of the Technical City Permits for the proposed Digital Display; (b) Owner shall have received any permits or approvals from other governmental agencies which are required by law to be issued prior to or concurrent with the issuance of the Technical City Permits for the proposed Digital Display or offsite improvements, as applicable;
(c) The proposed Digital Display conforms to the development standards for such Digital Display established in this Agreement. In the event that a proposed Digital Display is not in conformance with the development standards, Owner shall have the right to seek any relief from such standards under the procedures then available in the City; and (d) The proposed Digital Display or offsite improvements, as applicable, conforms to the Administrative and Technical Construction Codes of the City (Article VIII of the SMMC) (the “Technical Codes”) in effect on the date that the Technical Permit Application is filed.

7.3.3 New Technical Requirements. From time to time, the City’s Technical Codes may be amended to meet new technical requirements related to techniques of building and construction/installation of digital displays. If the sole means of achieving compliance for the Digital Display with such revisions to the Technical Codes made after the Effective Date (“New Technical Requirements”) would require an increase from the allowable Projections from Buildings into Minimum Setbacks or Height Projections established in this Agreement for the Digital Display, then the Community Development Director is hereby authorized to grant Owner limited relief from the allowable Projections from Buildings into Minimum Setbacks or Height Projections without amending this Agreement if the requested relief is in compliance with the City’s General Plan. Any such approval shall be granted only after the Community Development Director’s receipt of a written request for such relief from Owner. Owner is required to supply the Community Development Director with written documentation of the fact that compliance with the New Technical Requirements cannot be achieved by some other

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Packet Pg. 724 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 27 method. Any such relief shall only be granted to the extent necessary in the Community Development Director’s determination for Owner to comply with the New Technical Requirements.

7.4 Duration of Technical City Permits. The duration of Technical City Permits issued by the City for the Digital Display, and any extensions of the time period during which such Technical City Permits remain valid, shall be established in accordance with the Technical Codes in effect at the time that the Technical City Permits are issued. Subject to Section 3.4, the lapse or expiration of a Technical City Permit shall not preclude or impair Owner from subsequently filing another Technical Permit Application for the same matter during the Term of this Agreement, which shall be processed by the City in accordance with the provisions of this Article 7. Notwithstanding anything to the contrary in this Agreement, if Owner obtains building permits for the Digital Display and, at any time after the Outside Building Permit Issuance Date, such building permits expire or are revoked pursuant to the applicable terms of the SMMC (as the same may be amended from time to time), then Owner may not subsequently apply for new building permits for the Digital Display without first obtaining the prior written consent of the Community Development Director, which may be granted or withheld in the Community Development Director’s sole discretion.

ARTICLE 8

AMENDMENT AND MODIFICATION

8.1 Amendment and Modification of Development Agreement. Except as provided in Section 2.4.2, subject to the notice and hearing requirements of the applicable Development Agreement Statutes, this Agreement may be modified or amended from time to time only with the written consent of Owner and the City or their successors and assigns in accordance with the provisions of the SMMC and Section 65868 of the California Government Code.

ARTICLE 9
TERM

9.1 Effective Date. This Agreement shall be dated, and the obligations of the Parties hereunder shall be effective as of the date upon which both (i) the Digital Display District Ordinance and (ii) the ordinance approving this Agreement becomes effective (the “Effective Date”). The Parties shall execute this Agreement within ten (10) Business Days of the Effective Date.

9.2 Term.

9.2.1 Term of Agreement. The term of this Agreement shall commence on the Effective Date and shall continue for thirty (30) years thereafter (the “Term”), unless the Term is otherwise terminated pursuant to Section 11.4, after the satisfaction of all applicable public hearing and related procedural requirements, or pursuant to Section 3.3 or Section 9.2.2.

Notwithstanding the foregoing, if the approval by the California Coastal Commission of the Digital Display does not occur within six (6) months of the submittal by Owner of the Digital

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Packet Pg. 725 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 28 Display to the Coastal Commission, then the Term shall automatically be extended one month for each additional month or partial month greater than six (6) months that the Coastal Commission approval is delayed; provided, however, that Owner is diligently pursuing Coastal Commission approval. Nothing in this Section 9.2.1 modifies any tolling of the Term provided for in other sections of this Agreement, including Section 3.6(ii).

9.2.2 Early Removal and Termination. At or after three (3) years after the Digital Display Commencement Date, Owner may, at its sole discretion, remove the Digital Display. Prior to removal of the Digital Display, Owner shall provide the City with at least one hundred twenty (120) Days notice of its election to remove the Digital Display and terminate this Agreement. Such notice shall specify the date Owner intends to remove the Digital Display (the “Early Termination Date”). Upon Owner’s removal of the Digital Display in accordance with Section 2.7 and payment of any outstanding Ongoing Community Benefit Contribution accrued through the Early Termination Date plus an early termination fee in the amount of Two Hundred and Fifty Thousand Dollars ($250,000) (the “Early Termination Fee”), this Agreement shall automatically terminate.

9.2.3 Termination Certificate. Upon termination of this Agreement, the Parties hereto shall execute an appropriate certificate of termination in recordable form (a “Termination Certificate”), which shall be recorded in the official records of Los Angeles County.

9.2.4 Effect of Termination. Except as expressly provided herein, none of the Parties' respective rights and obligations under this Agreement shall survive the Term.

9.2.5 Extensions Available. Prior to its expiration, the Term of this Agreement may be extended for up to two (2) – ten (10) year extensions without the necessity of filing and processing an application to amend this Agreement; provided, however, that (i) each such extension shall be subject to the mutual agreement the Owner and City Manager, each acting in their sole discretion, and shall, upon mutual agreement, be memorialized in the form of an amendment to this Agreement; and (ii) Owner provides documentation of a current leasing or licensing contract between Owner and a billboard operator to evidence continuing use of the Digital Display beyond the original Term, as extended by any authorized extension. Owner understands, acknowledges, and agrees that such amendment to be negotiated may include revisions to this Agreement, including, without limitation, Section 2.5.

ARTICLE 10

PERIODIC REVIEW OF COMPLIANCE

10.1 City Review. The City shall review compliance with this Agreement once each year, on or before March 31st (each, a “Periodic Review”), in accordance with this Article 10 in order to determine whether or not Owner is out-of-compliance with any specific term or provision of this Agreement.

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Packet Pg. 726 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 29 10.2 Evidence of Reasonable Good Faith Compliance. On or before October 1st of each year, Owner shall deliver to the City a written report demonstrating that Owner has been in reasonable good faith compliance with this Agreement during the twelve (12) month period prior to the anniversary of the Effective Date. The written report shall be provided in the form established by the City at the time of the first annual report, if any, which form shall not change materially thereafter without Owner’s consent. For purposes of this Agreement, the phrase “reasonable good faith compliance” shall mean the following: (a) compliance by Owner with the requirements of the Existing Regulations, except as otherwise modified by this Agreement; and (b) compliance by Owner with the terms and conditions of this Agreement, subject to the existence of any specified Excusable Delays (as defined in Section 15.8 below) which prevented or delayed the timely performance by Owner of any of its obligations under this Agreement.

Without limiting the generality of the foregoing, demonstration of reasonable good faith compliance shall mean Owner’s satisfaction of requirements under Section 2.5.2 at the time that the report is submitted.

10.3 Information to be Provided to Owner. Prior to any public hearing concerning the Periodic Review of this Agreement, the City shall deliver to Owner a copy of all staff reports prepared in connection with a Periodic Review, written comments from the public and, to the extent practical, all related exhibits concerning such Periodic Review. If the City delivers to Owner a Notice of Breach pursuant to Section 11.1 below, the City shall concurrently deliver to Owner a copy of all staff reports prepared in connection with such Notice of Breach, all written comments from the public, and all related exhibits concerning such Notice of Breach.

10.4 Notice of Breach; Cure Rights. If during any Periodic Review, the City reasonably concludes on the basis of substantial evidence that Owner has not demonstrated that it is in reasonable good faith compliance with this Agreement, then the City may issue and deliver to Owner a written Notice of Breach pursuant to Section 11.1 below, and Owner shall have the opportunity to cure the default identified in the Notice of Breach during the cure periods and in the manner provided by Section 11.2 and Section 11.3, as applicable.

10.5 Failure of Periodic Review. The City’s failure to review at least annually compliance by Owner with the terms and conditions of this Agreement shall not constitute or be asserted by any Party as a breach by any other Party of this Agreement.

10.6 Termination of Development Agreement. If Owner fails to timely cure any material item(s) of non-compliance set forth in a Notice of Breach, then the City shall have the right but not the obligation to initiate proceedings for the purpose of terminating this Agreement pursuant to Section 11.4 below.

10.7 City Cost Recovery. Following completion of each Periodic Review, Owner shall reimburse the City for its actual and reasonable costs incurred in connection with such review after provision of a reasonably detailed invoice by the City.

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Packet Pg. 727 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 30 ARTICLE 11

DEFAULT

11.1 Notice and Cure.

11.1.1 Breach. If either Party fails to substantially perform any term, covenant or condition of this Agreement which is required on its part to be performed (a “Breach” or “Default”), the non-defaulting Party shall have those rights and remedies provided in this Agreement; provided that such non-defaulting Party has first sent a written notice of Breach (a “Notice of Breach”), in the manner required by Section 15.1, specifying the precise nature of the alleged Breach (including references to pertinent Sections of this Agreement and the Existing Regulations or Subsequent Code Changes alleged to have been breached), and the manner in which the alleged Breach may satisfactorily be cured. If the City alleges a Breach by Owner, the City shall also deliver a copy of the Notice of Breach to any Secured Lender of Owner which has delivered a Request for Notice to the City in accordance with Article 12.

11.1.2 Monetary Breach. In the case of a monetary Breach by Owner, Owner shall promptly commence to cure the identified Breach and shall complete the cure of such Breach within sixty (60) Days after receipt by Owner of the Notice of Breach; provided that if such monetary Breach is the result of an Excusable Delay or the cure of the same is delayed as a result of an Excusable Delay, Owner shall deliver to the City reasonable evidence of the Excusable Delay.

11.1.3 Non-Monetary Breach. In the case of a non-monetary Breach by either Party, the alleged defaulting Party shall promptly commence to cure the identified Breach and shall diligently prosecute such cure to completion; provided that the defaulting Party shall complete such cure within thirty (30) Days after receipt of the Notice of Breach or provide evidence of Excusable Delay that prevents or delays the completion of such cure. The thirty (30) day cure period for a non-monetary Breach shall be extended as is reasonably necessary to remedy such Breach; provided that the alleged defaulting Party commences such cure promptly after receiving the Notice of Breach and continuously and diligently pursues such remedy at all times until such Breach is cured.

11.1.4 Excusable Delay. Notwithstanding anything to the contrary contained in this Agreement, the City’s exercise of any of its rights or remedies under this Article 11 shall be subject to the provisions regarding Excusable Delay in Section 15.8 below.

11.2 Remedies for Monetary Default. If there is a Breach by Owner in the performance of any of its monetary obligations under this Agreement which remains uncured (a) sixty (60) Days after receipt by Owner of a Notice of Breach from the City and (b) after expiration of Secured Lender’s Cure Period under Section 12.1 (if a Secured Lender of Owner has delivered a Request for Notice to the City in accordance with Section 12.1), then an “Event of Monetary Default” shall have occurred by Owner and the City shall have available any right or remedy provided in this Agreement, at law or in equity. All of said remedies shall be cumulative and not exclusive of one another, and the exercise of any one or more of said remedies shall not constitute a waiver or election in respect to any other available remedy.

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Packet Pg. 728 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 31 11.3 Remedies for Non-Monetary Default.

11.3.1 Remedies of Parties. If any Party receives a Notice of Breach from the other Party regarding a non-monetary Breach, and the non-monetary Breach remains uncured:
(a) after expiration of all applicable notice and cure periods, and (b) in the case of a Breach by Owner, after the expiration of Secured Lender’s Cure Period under Section 12.1 (if a Secured Lender of Owner has delivered a Request for Notice to the City in accordance with Section

12.1), then an “Event of Non-Monetary Default” shall have occurred and the non-defaulting Party shall have available any right or remedy provided in this Agreement, or provided at law or in equity except as prohibited by this Agreement. All of said remedies shall be cumulative and not exclusive of one another, and the exercise of any one or more of said remedies shall not constitute a waiver or election in respect to any other available remedy.

11.3.2 Specific Performance. The City and Owner acknowledge that monetary damages and remedies at law generally are inadequate and that specific performance is an appropriate remedy for the enforcement of this Agreement. Therefore, unless otherwise expressly provided herein, the remedy of specific performance shall be available to the nondefaulting party if the other Party causes an Event of Non-Monetary Default to occur.

11.3.3 Writ of Mandate. The City and Owner hereby stipulate that Owner shall be entitled to obtain relief in the form of a writ of mandate in accordance with Code of Civil Procedure Section 1085 or Section 1094.5, as appropriate, to remedy any Event of NonMonetary Default by the City of its obligations and duties under this Agreement. Nothing in this Section 11.3.3, however, is intended to alter the evidentiary standard or the standard of review applicable to any action of, or approval by, the City pursuant to this Agreement or with respect to the Digital Display.

11.3.4 No Damages Relief Against City. It is acknowledged by Owner that the City would not have entered into this Agreement if the City were to be liable in damages under or with respect to this Agreement or the application thereof. Consequently, and except for the payment of attorneys’ fees and court costs, the City shall not be liable in damages to Owner, and Owner covenants on behalf of itself and its successors in interest not to sue for or claim any damages:
(a) for any default under this Agreement;
(b) for the regulatory taking, impairment or restriction of any right or interest conveyed or provided hereunder or pursuant hereto; or (c) arising out of or connected with any dispute, controversy or issue regarding the application or interpretation or effect of the provisions of this Agreement.

The City and Owner agree that the provisions of this Section 11.3.4 do not apply for damages which:
(a) do not arise under this Agreement;

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Packet Pg. 729 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 32 (b) are not with respect to any right or interest conveyed or provided under this Agreement or pursuant to this Agreement; or
(c) do not arise out of or which are not connected to any dispute, controversy, or issue regarding the application, interpretation, or effect of the provisions of this Agreement or the application of any City rules, regulations, or official policies.

11.3.5 Enforcement by the City. The City, at its discretion, shall be entitled to apply the remedies set forth in Chapters 1.09 and 1.10 of the SMMC as the same may be amended from time to time and shall follow the notice procedures of Chapter 1.09 and 1.10 respectively in lieu of Section 11.1 of this Agreement if these remedies are applied.

11.3.6 No Damages Against Owner. It is acknowledged by the City that Owner would not have entered into this Agreement if Owner were to be liable in damages in connection with any non-monetary default hereunder. Consequently, and except for the payment of attorneys’ fees and court costs, Owner shall not be liable in damages to the City for any nonmonetary default, and the City covenants on behalf of itself not to sue for or claim any damages:
(a) for any non-monetary default hereunder or;
(b) arising out of or connected with any dispute, controversy or issue regarding the application or interpretation or effect of the provisions of this Agreement.

The City and Owner agree that the provisions of this Section 11.3.6 do not apply for damages which:
(a) are for a monetary default; or
(b) do not arise out of or which are not connected with any dispute, controversy or issue regarding the application, interpretation, or effect of the provisions of this Agreement to or the application of any City rules, regulations, or official policies; or (c) constitute Damages which arise under Section 14.1.

11.3.7 No Damages Against City. It is acknowledged by the Owner that City would not have entered into this Agreement if City were to be liable for damages in connection with any non-monetary default hereunder. Consequently, and except for the payment of attorneys’ fees and court costs, City shall not be liable in damages to the Owner for any nonmonetary default, and the Owner covenants on behalf of itself not to sue for or claim any damages.

11.3.8 No Other Limitations. Except as expressly set forth in this Section 11.3, the provisions of this Section 11.3 shall not otherwise limit any other rights, remedies, or causes of action that either the City or Owner may have at law or equity after the occurrence of any Event of Non-Monetary Default.

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Packet Pg. 730 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 33 11.4 Modification or Termination of Agreement by City.

11.4.1 Default by Owner. If Owner causes either an Event of Monetary Default or an Event of Non-Monetary Default, then the City may commence proceedings to modify or terminate this Agreement pursuant to this Section 11.4.

11.4.2 Procedure for Modification or Termination. The procedures for modification or termination of this Agreement by the City for the grounds set forth in Section

11.4.1 are as follows:
(a) The City shall provide a written notice to Owner (and to any Secured Lender of Owner which has delivered a Request for Notice to the City in accordance with Section 12.1) of its intention to modify or terminate this Agreement unless Owner (or the Secured Lender) cures or corrects the acts or omissions that constitute the basis of such determinations by the City (a “Hearing Notice”). The Hearing Notice shall be delivered by the City to Owner in accordance with Section 15.1 and shall contain the time and place of a public hearing to be held by the City Council on the determination of the City to proceed with modification or termination of this Agreement. The public hearing shall not be held earlier than:
(i) thirty-one (31) Days after delivery of the Hearing Notice to Owner or (ii) if a Secured Lender has delivered a Request for Notice in accordance with Section 12.1, the day following the expiration of the “Secured Lender Cure Period” (as defined in Section 12.1). (b) If, following the conclusion of the public hearing, the City Council: (i) determines that an Event of Non-Monetary Default has occurred or the Owner has not been in reasonable good faith compliance with this Agreement pursuant to Section 10.1, and (ii) further determines that Owner (or the Secured Lender, if applicable) has not cured (within the applicable cure periods) the acts or omissions that constitute the basis of the determination under clause (i) above or if those acts or omissions could not be reasonably remedied prior to the public hearing that Owner (or the Secured Lender) has not in reasonable good faith commenced to cure or correct such acts or omissions prior to the public hearing or is not diligently and continuously proceeding therewith to completion, then upon making such conclusions, the City Council may modify or terminate this Agreement. The City cannot unilaterally modify the provisions of this Agreement pursuant to this Section 11.4. Any such modification requires the written consent of Owner. If the City Council does not terminate this Agreement, but proposes a modification to this Agreement as a result of the public hearing and Owner does not (within five (5) Business Days of receipt) execute and deliver to the City the form of modification of this Agreement submitted to Owner by the City, then the City Council may elect to terminate this Agreement at any time after the sixth day after Owner’s receipt of such proposed modification.

11.5 Cessation of Rights and Obligations. If this Agreement is terminated by the City pursuant to and in accordance with Section 11.4, the rights, duties and obligations of the Parties under this Agreement shall cease as of the date of such termination, except only for those rights and obligations that expressly survive the termination of this Agreement. In such event, any and all benefits, including money received by the City prior to the date of termination, shall be retained by the City.

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Packet Pg. 731 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 34 11.6 Completion of Improvements. Notwithstanding the provisions of Sections 11.2,

11.3, 11.4, and 11.5, if prior to termination of this Agreement, Owner has performed substantial work and incurred substantial liabilities in reasonable good faith reliance upon a building permit issued by the City, then Owner shall have acquired a vested right to (a) complete construction of the Digital Display in accordance with the terms of the building permit and this Agreement, subject to its continuing obligations with respect to all outstanding project and community benefits (Section 2.5) and, (b) use and maintain such Digital Display upon completion for the purposes provided in this Agreement. Any Digital Display completed pursuant to this Section

11.6 shall be considered legal non-conforming subject to all City ordinances standards and policies as they then exist governing legal non-conforming signs/digital displays and associated structures unless the Digital Display otherwise complies with the development standards for signs/digital displays the district in which it is located and the signs/digital display is otherwise permitted or conditionally permitted in the district.

ARTICLE 12

MORTGAGEES

12.1 Encumbrances on the Property. This Agreement shall not prevent or limit Owner (in its sole discretion), from encumbering the Property (in any manner) or any portion thereof or any improvement thereon by any mortgage, deed of trust, assignment of rents or other security device securing financing with respect to the Property (a “Mortgage”). Each mortgagee of a mortgage or a beneficiary of a deed of trust (each, a “Secured Lender”) on the Property shall be entitled to the rights and privileges set forth in this Article 12. Any Secured Lender may require from the City certain interpretations of this Agreement. The City shall from time to time, upon request made by Owner, meet with Owner and representatives of each of its Secured Lenders to negotiate in reasonable good faith any Secured Lender’s request for interpretation of any part of this Agreement. The City will not unreasonably withhold, condition or delay the delivery to a Secured Lender of the City’s written response to any such requested interpretation.

12.1.1 Mortgage Not Rendered Invalid. Except as provided in Section 12.1.2, neither entering into this Agreement nor a Breach of this Agreement, nor any Event of Monetary Default nor any Event of Non-Monetary Default shall defeat, render invalid, diminish, or impair the lien of any Mortgage made in reasonable good faith and for value.

12.1.2 Priority of Agreement. This Agreement shall be superior and senior to the lien of any Mortgage. Any acquisition or acceptance of title or any right or interest in or with respect to the Property or any portion thereof by a Secured Lender or its successor in interest (whether pursuant to foreclosure, trustee’s sale, deed in lieu of foreclosure, lease termination or otherwise) shall be subject to all of the terms and conditions of this Agreement, including any monetary payments owed to City under this Agreement.

12.1.3 Right of Secured Lender to Cure Default.
(a) A Secured Lender may give notice to the City, specifying the name and address of such Secured Lender and attaching thereto a true and complete copy of the Mortgage held by such Secured Lender, specifying the portion of the Property that is

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Packet Pg. 732 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 35 encumbered by the Secured Lender’s lien (a “Request for Notice”). If the Request for Notice has been given, at the same time the City sends to Owner any Notice of Breach or Hearing Notice under this Agreement, then if such Notice of Breach or Hearing Notice affects the portion of the Property encumbered by the Secured Lender’s lien, the City shall send to such Secured Lender a copy of each such Notice of Breach and each such Hearing Notice from the City to Owner. The copy of the Notice of Breach or the Hearing Notice sent to the Secured Lender pursuant to this Section 12.1.3(a) shall be addressed to such Secured Lender at its address last furnished to the City. The period within which a Secured Lender may cure a particular Event of Monetary Default or Event of Non-Monetary Default shall not commence until three Business Days after the City has sent to the Secured Lender such copy of the applicable Notice of Breach or Hearing Notice.
(b) After a Secured Lender has received a copy of such Notice of Breach or Hearing Notice, such Secured Lender shall thereafter have a period of time (in addition to any notice and/or cure period afforded to Owner under this Agreement) equal to: (a) twenty (20) Days in the case of any Event of Monetary Default and (b) thirty (30) Days in the case of any Event of Non-Monetary Default, during which period the Secured Lender may provide a remedy or cure of the applicable Event of Monetary Default or may provide a remedy or cure of the applicable Event of Non-Monetary Default; provided that if the cure of the Event of Non-Monetary Default cannot reasonably be completed within thirty Days, Secured Lender may, within such 30-day period, commence to cure the same and thereafter diligently prosecute such cure to completion (a “Secured Lender’s Cure Period”). If Owner has caused an Event of Monetary Default or an Event of Non-Monetary Default, then each Secured Lender shall have the right to remedy such Event of Monetary Default or an Event of Non-Monetary Default, as applicable, or to cause the same to be remedied prior to the conclusion of the Secured Lender’s Cure Period and otherwise as herein provided. The City shall accept performance by any Secured Lender of any covenant, condition, or agreement on Owner’s part to be performed hereunder with the same force and effect as though performed by Owner. (c) The period of time given to the Secured Lender to cure any Event of Monetary Default or an Event of Non-Monetary Default by Owner which reasonably requires that said Secured Lender be in possession of the Property to do so, shall be deemed extended to include the period of time reasonably required by said Secured Lender to obtain such possession (by foreclosure, the appointment of a receiver or otherwise) promptly and with due diligence; provided that during such period all other obligations of Owner under this Agreement, including, without limitation, payment of all amounts due, are being duly and promptly performed.

12.1.4 Secured Lender Not Obligated Under this Agreement. (a) No Secured Lender shall have any obligation or duty under this Agreement to perform the obligations of Owner’s or the affirmative covenants of Owner’s hereunder or to guarantee such performance unless and until such time as a Secured Lender takes possession or becomes the owner of the estate covered by its Mortgage. If the Secured Lender takes possession or becomes the owner of any portion of the Property, then from and after that date, the Secured Lender shall be obligated to comply with all provisions of this Agreement, including payment of any outstanding monetary obligations of Owner owed to City prior to the date the Secured Lender became the fee owner of the Property.

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Packet Pg. 733 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 36 (b) Nothing in Section 12.1.4(a) is intended, nor should be construed or applied, to limit or restrict in any way the City’s authority to terminate this Agreement, as against any Secured Lender as well as against Owner if any curable Event of Monetary Default or an Event of Non-Monetary Default is not completely cured within the Secured Lender’s Cure Period.

ARTICLE 13

TRANSFERS AND ASSIGNMENTS

13.1 Transfers and Assignments.

13.1.1 Not Severable from Ownership Interest in Property. This Agreement shall not be severable from Owner’s interest in the Property and any transfer of the Property or any portion thereof, shall automatically operate to transfer the benefits and burdens of this Agreement with respect to the transferred Property or transferred portions, as applicable.

13.1.2 Transfer Rights. Owner may freely sell, ground lease, transfer, exchange, hypothecate, encumber or otherwise dispose of its interest in the Property (collectively referenced herein as “Transfer”), without the consent of the City. Owner shall, however, give written notice to the City, in accordance with Section 15.1, of any transfer of the Property, disclosing in such notice (a) the identity of the transferee of the Property (the “Property Transferee”) and (b) the address of the Property Transferee as applicable.

13.2 Release Upon Transfer. Upon Transfer of the rights and interests of Owner to the Property, Owner shall be released from its obligations under this Agreement to the extent of Transfer with respect to the Property if: (a) Owner has provided written notice of such Transfer to City; and (b) the Property Transferee executes and delivers to City a written agreement in which the Property Transferee expressly and unconditionally assumes all of the obligations of Owner under this Agreement with respect to the Property in the form of Exhibit “F” attached hereto (the “Assumption Agreement”). Upon such Transfer of the Property and the express assumption of Owner’s obligations under this Agreement by the Property Transferee, the City agrees to look solely to the Property Transferee for compliance with the provisions of this Agreement. Any such Property Transferee shall be entitled to the benefits of this Agreement as “Owner” hereunder and shall be subject to the obligations of this Agreement. Failure to deliver a written Assumption Agreement hereunder shall not affect the transfer of the benefits and burdens as provided in Section 13.1, provided that the transferor shall not be released from its obligations hereunder unless and until the executed Assumption Agreement is delivered to the City.

ARTICLE 14

INDEMNITY TO CITY

14.1 Indemnity. Owner agrees to and shall defend, indemnify and hold harmless the City, its City Council, boards and commissions, officers, agents, employees, volunteers and other representatives (collectively referred to as “City Indemnified Parties”) from and against any and all loss, liability, damages, cost, expense, claims, demands, suits, attorney’s fees and

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Packet Pg. 734 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 37 judgments (collectively referred to as “Damages”), including but not limited to claims for damage for personal injury (including death) and claims for property damage arising directly or indirectly from the following: (1) for any act or omission of Owner or of its officers, board members, agents, employees, volunteers, contractors, subcontractors or other persons acting on its behalf, including the Owner’s tenants and/or Operator (collectively referred to as the “Owner Parties”) which occurs during the Term and relates to this Agreement; and (2) for any act or omission related to the operations of Owner Parties. Owner’s obligation to defend, indemnify and hold harmless applies to all actions and omissions of Owner Parties as described above caused or alleged to have been caused in connection with the Digital Display or this Agreement, except to the extent any Damages are caused by the negligence or willful misconduct of any City Indemnified Parties or any content provided by the City for display on the Digital Display. This Section 14.1 applies to all Damages suffered or alleged to have been suffered by the City Indemnified Parties regardless of whether or not the City prepared, supplied or approved plans or specifications or both for the Digital Display. The provisions of this Section shall survive the termination of the Agreement.

14.2 City’s Right to Defense. The City shall have the right to approve legal counsel retained by Owner to defend any claim, action or proceeding which Owner is obligated to defend pursuant to Section 14.1, which approval shall not be unreasonably withheld, conditioned or delayed. If any conflict of interest results during the mutual representation of the City and Owner in defense of any such action, or if the City is reasonably dissatisfied with legal counsel retained by Owner, the City shall have the right, at Owner’s cost and expense, (a) to have the City Attorney undertake and continue the City’s defense, or (b) with Owner’s approval, which shall not be reasonably withheld or delayed, to select separate outside legal counsel to undertake and continue the City’s defense.

ARTICLE 15

GENERAL PROVISIONS

15.1 Notices. Formal notices, demands and communications between the Parties shall be deemed sufficiently given if delivered to the principal offices of the City or Owner, as applicable, by (i) personal service, or (ii) express mail, Federal Express, or other similar overnight mail or courier service, regularly providing proof of delivery, or (iii) certified mail, postage prepaid, return receipt requested. Such notice shall be addressed as follows:

To City:

City of Santa Monica
1685 Main Street, Room 204
Santa Monica, CA 90401
Attention: City Manager
With a copy to:

City of Santa Monica
1685 Main Street, Mail Stop 28
Santa Monica, CA 90401
Attn: Community Development Department Director

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Packet Pg. 735 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 38 To Owner:

UNITED XYZ LLC
c/o XYZ.Rent – 301 AZ
2800 Olympic Blvd, Floor 1
Santa Monica, CA 90404
With a copy to:

Grant Carpenter
2800 Olympic Blvd, Floor 1
Santa Monica, CA 90404
Notice given in any other manner shall be effective when received by the addressee. Any Party may change the addresses for delivery of notices to such Party by delivering notice to the other Party in accordance with this provision.

15.2 Entire Agreement; Conflicts. This Agreement represents the entire agreement of the Parties. This Agreement integrates all of the terms and conditions mentioned herein or incidental hereto, and supersedes all negotiations or previous agreements between the Parties or their predecessors in interest with respect to all or any part of the subject matter hereof. Should any or all of the provisions of this Agreement be found to be in conflict with any other provision or provisions found in the Existing Regulations, then the provisions of this Agreement shall prevail.

15.3 Binding Effect. The Parties intend that the provisions of this Agreement shall constitute covenants which shall run with the land comprising the Property during the Term for the benefit thereof and that the burdens and benefits thereof shall bind and inure to the benefit of all successors-in-interest to the Parties hereto in accordance with Article 13. Every Party who now or hereafter owns or acquires any right, title, or interest in or to any portion of the Digital Display during the Term is and shall be conclusively deemed to have consented and agreed to every provision contained herein, to the extent relevant to said right, title or interest, whether or not any reference to this Agreement is contained in the instrument by which such person acquired an interest in the Digital Display.

15.4 Agreement Not for Benefit of Third Parties. This Agreement is made and entered into for the sole protection and benefit of Owner and the City and their respective successors and assigns. No other person shall have any right of action based upon any provision of this Agreement.

15.5 No Partnership or Joint Venture. Nothing in this Agreement shall be deemed to create a partnership or joint venture between the City and Owner or to render either Party liable in any manner for the debts or obligations of the other.

15.6 Estoppel Certificates. Either Party and any Secured Lender may, at any time, and from time to time, deliver written notice to the other Party requesting such Party to certify in writing (each, an “Estoppel Certificate”): (a) that this Agreement is in full force and effect, (b) that this Agreement has not been amended or modified either orally or in writing, or if so

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Packet Pg. 736 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 39 amended, identifying the amendments, (c) whether or not, to the knowledge of the responding Party, the requesting Party is in Breach or claimed Breach in the performance of its obligations under this Agreement, and, if so, describing the nature and amount of any such Breach or claimed Breach, and (d) whether or not, to the knowledge of the responding Party, any event has occurred or failed to occur which, with the passage of time or the giving of notice, or both, would constitute an Event of Monetary Default or an Event of Non-Monetary Default and, if so, specifying each such event. A Party receiving a request for an Estoppel Certificate shall execute and return such Certificate within thirty (30) Days following the receipt of the request therefor.

If the party receiving the request hereunder does not execute and return the certificate in such 30- day period and if circumstances are such that the Party requesting the notice requires such notice as a matter of reasonable business necessity, the Party requesting the notice may seek a second request which conspicuously states “FAILURE TO EXECUTE THE REQUESTED ESTOPPEL CERTIFICATE WITHIN FIFTEEN (15) DAYS SHALL BE DEEMED WAIVER PURSUANT TO SECTIONS 15.6 AND 15.13 OF THE DEVELOPMENT AGREEMENT” and which sets forth the business necessity for a timely response to the estoppel request. If the Party receiving the second request fails to execute the Estoppel Certificate within such 15-day period, it shall be conclusively deemed that the Agreement is in full force and effect and has not been amended or modified orally or in writing, and that there are no uncured defaults under this Agreement or any events which, with passage of time of giving of notice, of both, would constitute a default under the Agreement. The City Manager shall have the right to execute any Estoppel Certificate requested by Owner under this Agreement. The City acknowledges that an Estoppel Certificate may be relied upon by any Property Transferee, Secured Lender or other party. The Estoppel Certificate shall be provided in lieu of zoning compliance letters authorized pursuant to SMMC Section 9.38.020(E), or any successor thereto.

15.7 Time. Time is of the essence for each provision of this Agreement of which time is an element.

15.8 Excusable Delays.

15.8.1 In addition to any specific provisions of this Agreement, nonperformance by Owner of its obligations under this Agreement shall be excused when it has been prevented or delayed in such performance by reason of any act, event or condition beyond the reasonable control of Owner (collectively, “Excusable Delays”) for any of the following reasons:
(a) War, insurrection, walk-outs, riots, acts of terrorism, floods, pandemic, earthquakes, fires, casualties, acts of God, or similar grounds for excused performances;
(b) Governmental restrictions or moratoria imposed by the City or by other governmental entities or the enactment of conflicting State or Federal laws or regulations; (c) The imposition of injunctive relief, restraining orders, restrictions or moratoria by judicial decisions or by litigation, contesting the validity, or seeking the enforcement or clarification of, this Agreement, whether instituted by Owner, the City or any other person or entity, or the filing of a lawsuit by any Party arising out of this Agreement or any

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Packet Pg. 737 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 40 permit or approval Owner deems necessary or desirable for the implementation of the Digital Display;
(d) The institution of a referendum pursuant to Government Code Section 65867.5 or a similar public action seeking to in any way invalidate, alter, modify or amend the ordinance adopted by the City Council approving and implementing this Agreement; (e) Inability to secure necessary labor, materials or tools, due to strikes, lockouts, or similar labor disputes or due to a global pandemic; and/or (f) Failure of the City to timely perform its obligations hereunder, including its obligations under Section 7.2 above.

15.8.2 Under no circumstances shall the inability of Owner to secure financing be an Excusable Delay to the obligations of Owner except to the extent the inability to secure financing is directly associated with war, insurrection, walk-outs, riots, acts of terrorism, floods, pandemic, earthquakes, fires, casualties, acts of God or similar grounds beyond the control of Owner.

15.8.3 In order for an extension of time to be granted for any Excusable Delay, Owner must deliver to the City written notice of the commencement of the Excusable Delay within sixty (60) Days after the date on which Owner becomes aware of the existence of the Excusable Delay. The extension of time for an Excusable Delay shall be for the actual period of the delay.

15.8.4 Nothing contained in this Section 15.8 is intended to modify the terms of either Section 5.1.2 or Section 5.5 of this Agreement.

15.9 Governing Law. This Agreement shall be governed exclusively by the provisions hereof and by the laws of the State of California, without regard to any choice of law provisions thereof.

15.10 Cooperation in Event of Legal Challenge to Agreement. If there is any court action or other proceeding initiated by a third-party that includes any challenge to the validity, enforceability or any term or provision of this Agreement, the City’s CEQA determination for the Digital Display, and/or any other City approvals contemplated by this Agreement, then Owner shall indemnify, hold harmless, pay all costs actually incurred, and provide defense in said action or proceeding, with counsel reasonably satisfactory to both the City and Owner. The City shall cooperate with Owner in any such defense as Owner may reasonably request.

15.11 Attorneys’ Fees. If any Party commences any action for the interpretation, enforcement, termination, cancellation or rescission of this Agreement or for specific performance for the Breach of this Agreement, the prevailing Party shall be entitled to its reasonable attorneys’ fees, litigation expenses and costs. Attorneys’ fees shall include attorneys’ fees on any appeal as well as any attorneys’ fees incurred in any post-judgment proceedings to collect or enforce the judgment. Such attorneys’ fees shall be paid whether or not such action is prosecuted to judgment. In any case where this Agreement provides that the City or Owner is entitled to recover attorneys’ fees from the other, the Party so entitled to recover shall be entitled

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Packet Pg. 738 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 41 to an amount equal to the fair market value of services provided by attorneys employed by it as well as any attorneys’ fees actually paid by it to third Parties. The fair market value of the legal services for public attorneys shall be determined by utilizing the prevailing billing rates of comparable private attorneys.

15.12 Recordation. Parties shall cause this Agreement to be recorded against title to the Property in the Official Records of the County of Los Angeles in accordance with California Government Code Section 65868.5. The cost, if any, of recording this Agreement shall be borne by Owner.

15.13 No Waiver. No waiver of any provision of this Agreement shall be effective unless in writing and signed by a duly authorized representative of the Party against whom enforcement of a waiver is sought and referring expressly to this Section 15.13. No delay or omission by either Party in exercising any right or power accruing upon non-compliance or failure to perform by the other Party under any of the provisions of this Agreement shall impair any such right or power or be construed to be a waiver thereof, except as expressly provided herein. No waiver by either Party of any of the covenants or conditions to be performed by the other Party shall be construed or deemed a waiver of any succeeding breach or nonperformance of the same or other covenants and conditions hereof of this Agreement.

15.14 Construction of this Agreement. The Parties agree that each Party and its legal counsel have reviewed and revised this Agreement and that any rule of construction to the effect that ambiguities are to be resolved against the drafting Party shall not apply in the interpretation of this Agreement or any amendments or exhibits thereto.

15.15 Other Governmental Approvals. Owner may apply for such other permits and approvals as may be required for development of the Digital Display in accordance with this Agreement from other governmental or quasi-governmental agencies having jurisdiction over the Property including, without limitation, applying for approval by the California Coastal Commission. The City shall reasonably cooperate with Owner in its endeavors to obtain such permits and approvals.

15.15.1 Further Assurances; Covenant to Sign Documents. Each Party shall take all actions and do all things, and execute, with acknowledgment or affidavit, if required, any and all documents and writings, which may be necessary or proper to achieve the purposes and objectives of this Agreement.

15.15.2 Processing. Upon satisfactory completion by Owner of all required preliminary actions and payments of appropriate processing fees, if any, the City shall, subject to all legal requirements, promptly initiate, diligently process, and complete at the earliest possible time all required steps, and expeditiously act upon any approvals and permits necessary for the development by Owner of the Digital Display in accordance with this Agreement, including, but not limited to, the following:
(a) the processing of applications for and issuing of all Discretionary Approvals requiring the exercise of judgment and deliberation by City; (b) the holding of any required public hearings; and

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Packet Pg. 739 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 42 (c) the processing of applications for and issuing of all City Technical Permits requiring the determination of conformance with the Existing Regulations.

15.15.3 No Revocation. The City shall not revoke or subsequently disapprove any approval or future approval for the Digital Display once issued by the City provided that the Digital Display is in accordance with such approval. Any revocation or subsequent disapproval by the City shall state in writing the reasons why the development of the Digital Display is not deemed to be in accordance with such approval and the suggested actions to be taken in order for approval to be granted.

15.15.4 Processing During Third Party Litigation. If any third party lawsuit is filed against the City or Owner relating to this Agreement, the City shall not delay or stop the development, processing or construction of the Digital Display, or issuance of the City Technical Permits, unless the third party obtains a court order preventing the activity. The City shall not stipulate to or fail to oppose the issuance of any such order. Notwithstanding the foregoing and without prejudice to the provisions of Section 15.8.1(c), after service on the City or Owner of the initial petition or complaint challenging this Agreement or the Digital Display, the Owner may apply to the Community Development Director for a tolling of the applicable deadlines for Owner to otherwise comply with this Agreement. The Community Development Director shall approve such tolling, consistent with the standard in Section 15.27, for up to five years during the pendency of the litigation and shall provide Owner with notice of his or her decision on the tolling request within forty (40) Days of receiving Owner’s request.

15.15.5 State, Federal or Case Law. Where any state, federal or case law allows the City to exercise any discretion or take any act with respect to that law, the City shall, in an expeditious and timely manner, at the earliest possible time, (i) exercise its discretion in such a way as to be consistent with, and carry out the terms of, this Agreement and (ii) take such other actions as may be necessary to carry out in reasonable good faith the terms of this Agreement.

15.16 Jurisdiction and Venue. Any legal action or proceeding among the Parties arising out of this Agreement shall be instituted in the Superior Court of the County of Los Angeles, State of California, in any other appropriate court in that County, or in the Federal District Court in the Central District of California. The parties agree that venue exists in either court, and each party expressly waives any right to transfer to another venue. The parties further agree that either court will have personal jurisdiction over the parties to this Agreement.

15.17 Exhibits. The following exhibits which are part of this Agreement are attached hereto and each of which is incorporated herein by this reference as though set forth in full:

Exhibit “A” Legal Description of the Property
Exhibit “B” Digital Display Plans
Exhibit “C” SMMC Article 9 (Planning and Zoning)
Exhibit “D” Conditions of Approval
Exhibit “E” Permitted Fees and Exactions
Exhibit “F” Form of Assignment and Assumption Agreement

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Packet Pg. 740 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 43 Exhibit “G” Digital Display District Ordinance
Exhibit “H” Advertising Content Standards
Except as to the Digital Display Plans, which shall be treated in accordance with Section

2.1 above, the text of this Agreement shall prevail in the event that any inconsistencies exist between the Exhibits and the text of this Agreement.

15.18 Counterpart Signatures. The Parties may execute this Agreement on separate signature pages which, when attached hereto, shall constitute one complete Agreement.

15.19 Certificate of Performance. Upon the completion of the Digital Display or upon performance of this Agreement or its earlier revocation and termination, the City shall provide Owner, upon Owner’s request, with a statement (“Certificate of Performance”) evidencing said completion, termination or revocation and the release of Owner from further obligations hereunder, except for any further obligations which survive such completion, termination or revocation. The Certificate of Performance shall be signed by the appropriate agents of Owner and the City and shall be recorded against title to the Property in the official records of Los Angeles County, California. Such Certificate of Performance is not a notice of completion as referred to in California Civil Code Section 3093.

15.20 Interests of Owner. Owner represents to the City that, as of the Effective Date, it is the owner of the entire Property, subject to encumbrances, easements, covenants, conditions, restrictions, and other matters of record.

15.21 Operating Memoranda. The provisions of this Agreement require a close degree of cooperation between the City and Owner. During the Term of this Agreement, clarifications to this Agreement and the Existing Regulations may be appropriate with respect to the details of performance of the City and Owner. If and when, from time to time, during the term of this Agreement, the City and Owner agree that such clarifications are necessary or appropriate, they shall effectuate such clarification through operating memoranda approved in writing by the City and Owner, which, after execution, shall be attached hereto and become part of this Agreement and the same may be further clarified from time to time as necessary with future written approval by the City and Owner. Operating memoranda are not intended to and cannot constitute an amendment to this Agreement but mere ministerial clarifications, therefore public notices and hearings shall not be required for any operating memorandum. The City Attorney shall be authorized, upon consultation with, and approval of, Owner, to determine whether a requested clarification may be effectuated pursuant to the execution and delivery of an operating memorandum or whether the requested clarification is of such character to constitute an amendment of this Agreement which requires compliance with the provisions of Section 8.1 above. The authority to enter into such operating memoranda is hereby delegated to the City Manager and the City Manager is hereby authorized to execute any operating memoranda hereunder without further action by the City Council.

15.22 Acknowledgments, Agreements and Assurance on the Part of Owner.

15.22.1 Owner’s Faithful Performance. The Parties acknowledge and agree that Owner’s faithful performance in developing the Digital Display on the Property and in

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Packet Pg. 741 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 44 constructing and installing certain public improvements pursuant to this Agreement and complying with the Existing Regulations will fulfill substantial public needs. The City acknowledges and agrees that there is good and valuable consideration to the City resulting from Owner’s assurances and faithful performance thereof and that same is in balance with the benefits conferred by the City on the Digital Display. The Parties further acknowledge and agree that the exchanged consideration hereunder is fair, just and reasonable. Owner acknowledges that the consideration is reasonably related to the type and extent of the impacts of the Digital Display on the community and the Property, and further acknowledges that the consideration is necessary to mitigate the direct and indirect impacts caused by Owner on the Property.

15.22.2 Obligations to be Non-Recourse. As a material element of this Agreement, and in partial consideration for Owner’s execution of this Agreement, the Parties each understand and agree that the City’s remedies for breach of the obligations of Owner under this Agreement shall be limited as described in Sections 11.2 through 11.4 above.

15.23 Waiver of Protest. Owner acknowledges and agrees that by executing this Agreement, Owner waives any and all claims and rights, if any, under Government Code Section 66020 to protest fees, dedications, reservations, or exactions required by this Agreement (hereinafter “exactions”), including the City’s right to request and receive the exaction pursuant to this Agreement, the total exaction amount if specified by the Agreement, and the formula for subsequently calculating exactions if the formula is established by the Existing Regulations.

Notwithstanding the above, if the amount of any exaction is not expressly set forth in this Agreement, Owner reserves the right to protest the subsequent calculation of this amount.

15.24 Not a Public Dedication. Nothing in this Agreement shall be deemed to be a gift or dedication of the Property, or of the Digital Display, or any portion thereof, to the general public, for the general public, or for any public use or purpose whatsoever, it being the intention and understanding of the Parties that this Agreement be strictly limited to and for the purposes herein expressed for the installation, maintenance, and operation of the Digital Display as private property. Owner shall have the right to prevent or prohibit the use of the Property, or the Digital Display, or any portion thereof, including common areas and building and improvements located thereon, by any person for any purpose inimical to the development of the Digital Display, including without limitation to prevent any person or entity from obtaining or accruing any prescriptive or other right to use the Property or the Digital Display.

15.25 Other Agreements. The City acknowledges that certain additional agreements may be necessary to effectuate the intent of this Agreement and facilitate development of the Digital Display. The City Manager is hereby authorized to prepare, execute, and record those additional agreements.

15.26 Severability and Termination. If any provision of this Agreement is determined by a court of competent jurisdiction to be invalid or unenforceable, or if any provision of this Agreement is superseded or rendered unenforceable according to any law which becomes effective after the Effective Date, the remainder of this Agreement shall be effective to the extent the remaining provisions are not rendered impractical to perform, taking into consideration the purposes of this Agreement.

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Packet Pg. 742 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 45 15.27 Community Development Director Approval. Whenever this Agreement requires Community Development Director review and approval, such review and approval shall be undertaken in reasonable good faith and with due diligence and shall not be unreasonably withheld, conditioned or delayed.

15.28 City Manager Approval. Whenever this Agreement requires City Manager review and approval, such review and approval shall not preclude the City Manager from consulting with the City Council before rendering an approval.

This Agreement is executed by the Parties on the date first set forth above and is made effective on and as of the Effective Date.

OWNER:

UNITED XYZ LLC,
a California limited liability company
By: ________DRAFT_______________
Name: __________________________
Title: ___________________________
CITY:

CITY OF SANTA MONICA,
a municipal corporation
By: ________DRAFT_______________
Name: ___________________________
Title: _____________________________
ATTEST:

By: ________DRAFT_______________
Name: ______________________________
City Clerk
APPROVED AS TO FORM:

By: ________DRAFT_______________
Name: ______________________________
City Attorney

ACKNOWLEDGEMENT AND CONSENT BY OPERATOR

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Packet Pg. 743 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second 46 As of the Effective Date of this Agreement, Orange Barrel Media, LLC, a Delaware limited liability company is the Operator as defined in Section 1.26 of this Agreement. Operator confirms its understanding of this Agreement, including but not limited to, Section 2.5 (Project and Community Benefits) and 2.11 (Operator Not a Third-Party Beneficiary to this Agreement).

OPERATOR:

ORANGE BARREL MEDIA, LLC,
a Delaware limited liability company
By: ________DRAFT_______________
Name: __________________________
Title: ___________________________

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Packet Pg. 744 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Exhibit “A”, Page 1
EXHIBIT “A”

LEGAL DESCRIPTION OF PROPERTY
LOT “M” AND “N”, IN BLOCK 121 OF SANTA MONICA, IN THE CITY OF SANTA

MONICA, COUNTY OF LOS ANGELES, STATE OF CALIFORNIA, AS PER MAP RECORDED IN BOOK 3, PAGES 80 AND 81, AND IN BOOK 39, PAGES 45 THROUGH 51,

INCLUSIVE, BOTH OF MISCELLANEOUS RECORDS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.

APN: 4291-003-009 & 010

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Packet Pg. 745 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Exhibit “B”, Page 1
EXHIBIT “B”

DIGITAL DISPLAY PLANS
[Behind this Page.]

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Packet Pg. 746 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second © 2025 ORANGE BARREL MEDIA
301 ARIZONA AVE - NOVEMBER 18, 2025

ELEVATIONS

BUILDING FOLDSBUILDING FOLDS

PROPERTY LINEPROPERTY LINEPROPERTY LINE
MAX. 14’-7”
MAX. 15’-2”
MAX. 15’-6”
18’-9” 30’-1”
22’-0” 19’-9” 24’-0”
(ANGLED)
17’-9”

WEST ELEVATION
3RD STREET PROMENADE

SOUTH ELEVATION

ARIZONA AVENUE
301 ARIZONA AVENUE
1000 SF TOTAL

LED SIGNAGE

MEDIA OPERATOR IDENTIFICATION

SIGNAGE, INTERNALLY ILLUMINATED
LETTERS 7” H x 10’-0” W

NEW ARCHITECTURAL
METAL TRIM. PAINTED

FINISH TO MATCH

SATIN ALUMINUM
FINISH.
1'-6"
2'-2" W TRIM
2'-4" W TRIM
16'-3" 18'-3"
2'-2" H TRIM
9" JOG 6" JOG

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Packet Pg. 747 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second © 2025 ORANGE BARREL MEDIA
301 ARIZONA AVE - NOVEMBER 18, 2025
PLAN

PROPERTY LINE
19’-9”
(ANGLED)
22’-0”
(ANGLED)
24’-0”
8’-0” MAX.

PROJECTION
10’-0” MAX.

PROJECTION

PLOT PLAN
301 ARIZONA AVENUE

ARCHITECTURAL TRIM BELOW

LED MODULES & SUBFRAME

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Packet Pg. 748 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Exhibit “C”, Page 1
EXHIBIT “C”
SMMC ARTICLE 9 (PLANNING AND ZONING)
[To be inserted.]

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Packet Pg. 749 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Exhibit “D”, Page 1
EXHIBIT “D”

CONDITIONS OF APPROVAL
Project Specific Conditions

1. The Digital Display shall provide the project and community benefits as established in Section 2.5 of this Agreement.

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Packet Pg. 750 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Exhibit “E”, Page 1
EXHIBIT “E”

PERMITTED FEES AND EXACTIONS

1. Owner shall pay the following fees and charges that are within the City’s jurisdiction and at the rate in effect at the time payments are made:
(a) Upon submittal for plan check, Owner shall pay City plan check fees; (b) Prior to issuance of construction permits, Owner shall pay the following City fees and all other standard fees imposed on similar development projects, which may include:
 Building, Plumbing, Mechanical, Electrical, Grading, Seismic Mapping, Landscape, Excavation and Shoring Permit fees (collected by Building & Safety)
 Construction and Demolition (C&D) Waste Management performance security fee (SMMC Chapter 8.108) (collected by the Public Works Department)
(c) Upon inspection of the project during the course of construction, City inspection fees.

These fees shall be reimbursed to Owner in accordance with the City's standard practice should Owner not proceed with development of the project.

2. Prior to issuance of permits for any construction work in the public right-of-way, or use of public property, Owner shall pay the following City fees:
 Use of Public Property Permit fees (SMMC 7.04.670) (Public Works Department)
 Utility Excavation Permit fee (SMMC 7.06.070) (Public Works Department)  Street Permit fee (SMMC 7.04.790) (Public Works Department)

3. Owner shall reimburse the City for its ongoing actual costs to monitor the project’s compliance with this Development Agreement. The City shall bill Owner for staff time and any material used pursuant to the hourly fees in effect at the time monitoring is performed. Owner shall submit payment to the City within 30 days after receipt of an invoice for same from the City.

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Packet Pg. 751 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Exhibit “F”, Page 1
EXHIBIT “F”

FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT
Recording Requested By and
When Recorded Mail To:

UNITED XYZ LLC
c/o XYZ.Rent – 301 AZ
2800 Olympic Blvd, Floor 1
Santa Monica, CA 90404
________________________________________________________________________

ASSIGNMENT AND ASSUMPTION AGREEMENT
This ASSIGNMENT AND ASSUMPTION AGREEMENT (“Agreement”) is made and entered into by and between ___________________________, a _____________________________ (“Assignor”), and ________________________, a __________________ (“Assignee”).

R E C I T A L S
[NOTE TO DRAFTER: This form Assignment and Assumption Agreement is drafted for a purchase and sale of the full Project Site. If the transfer is other than a purchase and sale and/or less than the entire Project Site is being transferred, this form needs to be revised. Notably, if less than the entire Project Site is being transferred and/or the Project Site or any portion therefore is being transferred to more than one owner, this form needs to be revised to add joint and several liability for all owners of the Project Site.] A. The City of Santa Monica (“City”) and Assignor entered into that certain Development Agreement dated _______________, ____ (the “Development Agreement”), with respect to the real property located in the City of Santa Monica, State of California more particularly described in Exhibit “A” attached hereto (the “Project Site”).

B. Assignor has obtained from the City certain development approvals and permits with respect to the development of the Project Site, including without limitation, approval of the Development Agreement for the Project Site (collectively, the “Digital Display Approvals”).

C. Assignor intends to sell, and Assignee intends to purchase, the Project Site.

D. In connection with such purchase and sale, Assignor desires to transfer all of the Assignor’s right, title, and interest in and to the Development Agreement and the Digital Display Approvals with respect to the Project Site. Assignee desires to accept such assignment from Assignor and assume the obligations of Assignor under the Development Agreement and the Digital Display Approvals with respect to the Project Site.

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Packet Pg. 752 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Exhibit “F”, Page 2
THEREFORE, the parties agree as follows:

1. Assignment. Assignor hereby assigns and transfers to Assignee all of Assignor’s right, title, and interest in and to the Development Agreement and the Digital Display Approvals with respect to the Project Site. Assignee hereby accepts such assignment from Assignor.

2. Assumption. Assignee expressly assumes and agrees to keep, perform, and fulfill all the terms, conditions, covenants, and obligations required to be kept, performed, and fulfilled by Assignor under the Development Agreement and the Digital Display Approvals with respect to the Project Site.

3. Effective Date. The execution by City of the attached receipt for this Agreement shall be considered as conclusive proof of (a) delivery of this Agreement (b) the assignment and assumption contained herein, and (c) the release of Assignor in accordance with Section 13.2 of the Development Agreement. This Agreement shall be effective upon its recordation in the Official Records of Los Angeles County, California, provided that Assignee has closed the purchase and sale transaction and acquired legal title to the Project Site.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the dates set forth next to their signatures below.
“ASSIGNOR”
_________________________________
“ASSIGNEE”
_____________________________

4.J.a
Packet Pg. 753 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Exhibit “F”, Page 3

RECEIPT BY CITY
The attached ASSIGNMENT AND ASSUMPTION AGREEMENT is received by the City of Santa Monica on this ___ day of ________________, ________.

CITY OF SANTA MONICA
___________________________________
By: _______________________________
Community Development Director

4.J.a
Packet Pg. 754 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Exhibit “G”,
EXHIBIT “G”
Digital Display District Ordinance
[To be inserted.]

4.J.a
Packet Pg. 755 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second Exhibit “H”
EXHIBIT “H”

ADVERTISING CONTENT STANDARDS
The City allows exterior advertising without regard to content and viewpoint, except advertising that contains material falling within one or more of the following categories:

1. Obscene Matter or Harmful Matter as those terms are defined by the California Penal Code Sections 311 or 313.

2. False, misleading or deceptive material. Any material that is, or the sponsor reasonably should have known is, false, fraudulent, misleading, deceptive, or would constitute a tort of defamation or invasion of privacy.

3. Material that infringes on any copyright, trade or service mark, title, or slogan.

4. Illegal activity and hate speech. Material that promotes or encourages unlawful or illegal behavior or activities under local, state, or federal laws.

5. Profanity and violence. Advertising that contains any profane language, or portrays images or descriptions of graphic violence, or intentional infliction of pain or violent action towards or upon a person or animal, or that depicts weapons or devices that appear to be aimed or pointed at the viewer or observer in a menacing manner.

6. Effects likely to cause driver distraction, including but not limited to flashing lights, copy that simulates any traffic sign in a manner which confuses the public, or anything that may interfere with the safe operation of traffic, pedestrians, or the public at large.

7. Material that conflicts with any applicable federal, state, or local law, statute, or ordinance, including but not limited to laws and regulations regarding advertising of tobacco, alcohol, and cannabis products.

8. Political advertisements designed to promote views of particular political groups or influence opinions of others on public policy issues.

9. Predatory lending services, predatory solicitation, and/or displays false, misleading or deceptive content.

4.J.a
Packet Pg. 756 Attachment: ORD-ord-Second Reading 301 AZ DA (7477 : Digital Display DA - 301 Arizona Avenue/1253 Third Street Promenade - Second City Council
Report
City Council Meeting: January 13, 2026
Agenda Item: 4.K
1 of 2
To: Mayor and City Council
From: Heidi Von Tongeln, Interim City Attorney, City Attorney's Office, Administration
Subject: Second Reading and Adoption of an Interim Zoning Ordinance Updating Applicability Thresholds and Standards for Resource and Recycling Room Dimensions Set Forth in Santa Monica Municipal Code Section 9.21.130 in Order to Further Economic Recovery Efforts by Facilitating a Self-Certification Building Permit Program
Recommended Action
Staff recommends that the City Council adopt the attached Ordinance.

Executive Summary
At its meeting on December 16, 2025, the City Council introduced for first reading an Interim Zoning Ordinance updating applicability thresholds and standards for resource and recycling room dimensions set forth in Santa Monica Municipal Code Section

9.21.130 in order to further economic recovery efforts by facilitating a self-certification building permit program. The ordinance is now presented to the City Council for adoption.

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Prepared By: Bradley Michaud, Legal Administrative Services Officer Approved Forwarded to Council
Attachments:

A. ORD-Self-Certification IZO_2d

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Packet Pg. 758
1 City Council Meeting: January 13, 2026 Santa Monica, California ORDINANCE NUMBER _________ (CCS)
(City Council Series)

AN INTERIM ZONING ORDINANCE OF THE CITY COUNCIL OF THE CITY OF

SANTA MONICA UPDATING APPLICABILITY THRESHOLDS AND STANDARDS FOR

RESOURCE AND RECYCLING ROOM DIMENSIONS SET FORTH IN SANTA MONICA MUNICIPAL CODE SECTION 9.21.130 IN ORDER TO FURTHER

ECONOMIC RECOVERY EFFORTS BY FACILITATING A SELF-CERTIFICATION

BUILDING PERMIT PROGRAM
WHEREAS, on March 13, 2020, the City Manager, as the Director of Emergency Services (“Director of Emergency Services”), proclaimed the existence of a local emergency pursuant to Chapter 2.16 of the Santa Monica Municipal Code to ensure the availability of mutual aid and effectuate the City’s response to the novel coronavirus (“COVID-19”), and this local emergency was restated on March 14, 2020, through a revised declaration of local emergency to ensure compliance with all digital signature requirements (the “Executive Order”); and
WHEREAS, on March 16, 2020, the Director of Emergency Services issued a Third Supplement to the Executive Order, requiring the closure of a wide range of businesses including bars, nightclubs, on-premises restaurant service, movie theatres, live performance venues, gyms, fitness centers, spas, hair salons, nail salons, and massage parlors; and
WHEREAS, on March 19, 2020, California Governor Gavin Newsom issued Executive Order N-33-20 directing all residents of the State of California to heed directives issued by the State Health Officer on the same date instructing all Californians to stay home except as needed to maintain continuity of operations of the federal critical infrastructure sectors; and

4.K.a
Packet Pg. 759 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) 2 WHEREAS, on March 19, 2020, the Los Angeles County Department of Public Health issued an enhanced Health Officer Order, the Safer at Home Order for Control of COVID-19, amending and superseding its earlier March 16, 2020 Order, closing all nonessential businesses, and limiting gatherings to 9 people or less; and WHERAS, after March 19, 2020, the Los Angeles Department of Public Health, on multiple occasions, amended and modified its Health Officer Order, recognizing the issues posed by community transmission of COVID-19 in Los Angeles County, and, in response, maintaining public health measures that have, at differing times, included strict limitations on public gatherings, required closures of certain businesses, and strict limitations and protocols for the operations of businesses permitted to remain open; and WHEREAS, as of March 31, 2023, the local, state, and federal COVID-19 emergency declarations have concluded; and
WHEREAS, although the emergency orders have been lifted, the economic impacts of the COVID-19 closures of, and limitations on, businesses have been and continue to be devastating to the local Santa Monica economy, and various locations are continuing to experience economic uncertainty; and
WHEREAS, as the commercial and economic landscape evolves, the City’s economic recovery and competitive advantage will depend on its ability to deliver on a diverse range of business uses; and
WHEREAS, the City has an important governmental interest in maintaining a thriving business community and protecting the health, safety, and economic welfare of its citizens and businesses; and

4.K.a
Packet Pg. 760 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) 3 WHEREAS, in connection with the City’s economic recovery efforts, on February 11, 2025, City Council directed staff to create a self-certification pilot program allowing building permits for “non-structural commercial tenant improvements, single-family home improvements, and accessory dwelling units” to bypass the normal plan review process and receive approval within one to five business days; and WHEREAS, the purpose of this direction is to facilitate the City’s economic recovery and reduce the workload on plan check professionals, allowing staff to focus on the more complex projects in the City that require their attention; and WHEREAS, the self-certification program will fully remove plan check review for certain identified project times and shift the responsibility for determining compliance with all codes to a pre-qualified licensed architect, who would certify that projects comply with requirements of the Building Code, Fire Code, Zoning Ordinance, and Public Works, including Resource Recovery and Recycling (RRR), Office of Sustainability and Environment, and Water Resources; and
WHEREAS, streamlining the review process for certain projects will facilitate business recovery and generate increased sales tax revenue for the City; and WHEREAS, the initial stages of the self-certification program will focus on commercial tenant improvements, which comprise approximately 36% of the building permits submitted to the City; and
WHEREAS, Santa Monica Municipal Code Section 9.21.130 provides RRR Standards in connection with General Site Regulations; and

4.K.a
Packet Pg. 761 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) 4 WHEREAS, the proposed amendments to the RRR standards simplify the thresholds for when trash enclosure updates and review are required and revise implementation of resources and recycling room dimensions; and WHEREAS, one of the current applicability thresholds is based on outdated permit valuation standards and cumulative alterations made over the course of a twelve-month period; and
WHEREAS, these thresholds have consistently presented constraints to new businesses, and amendments to these requirements are required to facilitate an effective self-certification program; and
WHEREAS, the amendments will also address long-standing issues that will benefit all permittees, facilitate the City’s economic recovery, streamline the building permit process for a variety of projects, and provide more transparency with respect to permit requirements; and
WHEREAS, the amendment will also eliminate the standard pertaining to “Large Residential, Nonresidential and Mixed-Use Development” that gives discretionary approval to the Director of Public Works to determine trash room dimensions, as this is not an objective standard or process; and
WHEREAS, removing this language provides greater transparency and objectivity to trash enclosure standards; and
WHEREAS, City Council finds and declares that there exists a current and immediate threat to public health, safety, and welfare continues to exist due to the devastating impact the COVID-19 mandated closures and limitations have had on the local business economy along with the City’s current usage of outdated permit valuation

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Packet Pg. 762 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) 5 thresholds for determining when trash enclosure dimensions review is required, such that requiring applicants to comply with these RRR requirements would result in a threat to public health, safety, and welfare.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. Santa Monica Municipal Code Section 9.21.130 is hereby amended as follows:

Section 9.21.130. Resource Recovery and Recycling Standards.

A. Applicability. All uses shall provide refuse and recycling storage and staging areas that comply with the standards of this Section. Refuse and recycling rooms meeting the standards of subsection (C) shall be provided in conjunction with:

1. New construction for which a building permit is required.

2. Improvements affecting refuse and recycling areas of publicly owned facilities.

3. Additions that add 30% or more to the existing floor area.

4. Eating and Drinking Establishments, as defined in Section 9.51.030(B)(8), and Food and Beverage Sales, as defined in Section 9.51.030(B)(10).

B. General Requirements. Each parcel containing a building or structure shall provide and maintain one or more refuse containers and recycling containers on the premises.

1. Containers shall be of sufficient capacity and number to accommodate the refuse and recyclable materials generated by the uses on the parcel, in compliance with guidelines established by the Public Works Department. An adequate number of bins or

4.K.a
Packet Pg. 763 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) 6 containers to allow for the collection and loading of refuse and recyclable materials shall be located within the refuse and recycling rooms or outdoor enclosures.

2. All outdoor storage of refuse, recyclable materials, and other items or material intended to be discarded or collected shall be screened from public view. On parcels where refuse and recyclable materials are both stored and collected adjacent to an alley or other public right-of-way, the refuse and recyclable materials shall be screened from public view on at least 3 sides by a solid opaque impact-resistant wall not less than 5 feet or more than 8 feet in height, and on the fourth side by a solid opaque impactresistant gate not less than 5 feet or more than 8 feet in height, or of other such material or design approved by the Architectural Review Board. The gate shall be maintained in working order and shall remain closed except during such times as refuse, recyclable materials and other such items are being discarded, placed for collection, or collected.

3. All refuse and recyclable materials which are stored and collected from the same location out of doors shall be stored not more than 10 feet from the parcel line which is closest to the refuse collection point. If the collection area is more than 20 feet from the collection point, a staging area within 10 feet of the collection point is necessary.

4. Refuse and recycling rooms or outdoor enclosures shall be secured to prevent the theft of recyclable materials by unauthorized persons, while allowing authorized persons access for disposal of materials, and must provide protection against adverse environmental conditions which may render the collected materials unmarketable.

4.K.a
Packet Pg. 764 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) 7 C. Refuse and Recycling Rooms. A refuse and recycling room or outdoor enclosure shall comply with all the requirements of the Zoning District in which it is located as well as the following minimum design standards:

1. Single Unit and Duplex Residences. Single Unit Residences and Duplexes shall include a designated area to store refuse, recycling, and organic materials screened from public view or a designated area in a garage or accessory structure.

2. Residential Multiple-Unit Development. Developments consisting of 3 or more dwelling units shall include a refuse and recycling room meeting the minimum dimensions stated in Table 9.21.130.A below, or shall provide an equivalent space within an outdoor enclosure that conforms to the same dimensions stated in the table.

TABLE 9.21.130.A: MINIMUM RESOURCE AND RECYCLING ROOM DIMENSIONS – RESIDENTIAL MULTI-UNIT DEVELOPMENT
Number of
Residential Units
Minimum Room Dimensions
Width (ft.) Length (ft.) Height (ft.)
3 – 10 units 22 ft. 10 ft. 10 ft. (1)
11 – 20 units 22 ft. 14 ft. 10 ft. (1)
21 or greater 28 ft. 20 ft. 10 ft. (1)
(1) An outdoor enclosure must have walls at least 6 ft. in height and an opening at least 8 ft. wide.

3. Nonresidential and Mixed-Use Development.
a. Nonresidential and mixed-use developments shall include a refuse and recycling room meeting the minimum dimensions stated in Table 9.21.130.B below, or shall provide an equivalent space available in a centralized area or an

4.K.a
Packet Pg. 765 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) 8 outdoor enclosure with the same width and length dimensions, and a minimum height of 6 feet, and an opening at least 8 feet wide.
b. Refuse and recycling rooms or outdoor enclosures shall be at the same grade as and adjacent to an existing alley, if the site is adjacent to an alley. c. The 3 interior walls of refuse and recycling indoor and outdoor enclosures shall include a 2 inch by 16 inch wall guard covering the length of all interior walls in existing properties, or a curb 6 inches in depth by 8 inches tall for remodels and new construction.
d. Nonresidential buildings and buildings that prepare process and/or sell any and all food products must have a fully-enclosed refuse, and recycling and food waste area with lighting, ventilation, and sanitary drains. Size and dimensions shall conform to the required design standards outlined in this Chapter.

TABLE 9.21.130.B: MINIMUM RESOURCE AND RECYCLING ROOM DIMENSIONS – NONRESIDENTIAL DEVELOPMENT AND MIXED-USE
Aggregate Floor
Area
Minimum Room Dimensions
Width (ft.) Length (ft.) Height (ft.)
Less than 5,000 sq.
ft.
22 ft. 10 ft. 10 ft.
5,001 – 20,000 sq.
ft.
22 ft. 14 ft. 10 ft.
20,001 sq. ft. or
greater
28 ft. 20 ft. 10 ft.

4.K.a
Packet Pg. 766 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) 9 4. Subterranean Storage. Buildings or structures in which refuse and recyclable materials are stored in otherwise locked and secured subterranean garages may be permitted to designate a fenced area for the storage of refuse and recyclable materials in compliance with specifications as to location and materials established by the Director of Public Works.

D. Modifications. The Director of Public Works, in consultation with the Director of Planning, shall have the authority to modify the requirements, as listed below, subject to the design standards of this Section when, upon a written application for a modification, the Director of Public Works determines that the applicant has demonstrated that imposition of the design standards is technically infeasible or creates an unreasonable hardship. Such authority shall be limited to the following:

1. Modify the dimensions of refuse and recycling rooms or outdoor enclosures, provided that the frequency of refuse collection is modified to adequately serve the uses on the parcel and protect the public health, safety and general welfare.

2. Permit more than one recycling room or outdoor enclosure, provided the aggregate area is in substantial compliance with the design standards of this Section as determined by the Director of Public Works, and provided that each room or outdoor enclosure furnishes convenient access for disposal and collection of both refuse and recyclable materials. Refuse containers located adjacent to alleys should remain open to the alley. Refuse enclosures in subterranean parking areas should have a door of equal size with door-stops attached or a follow-up door and provide adequate lighting, ventilation and sanitary drains. If the refuse enclosure is located in a subterranean parking area or remote locations, a City-approved staging area on private property at the alley or

4.K.a
Packet Pg. 767 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) 10 street level must be provided. In the event that the location of the refuse and recyclable room or outdoor enclosure is not convenient for collection, the Director of Public Works shall be authorized to require payment of a fee, established by resolution of the City Council, for collection of the refuse and recyclable materials. In no event shall a fee be authorized in lieu of providing a refuse and recycling room or outdoor enclosure.

SECTION 2. Any provision of the Santa Monica Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance.

SECTION 3. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional.

SECTION 4. The Mayor shall sign and the City Clerk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Ordinance shall become effective immediately upon adoption.

4.K.a
Packet Pg. 768 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) 11 SECTION 5. This Ordinance shall be of no further force and effect sixty days from its effective date, unless it is otherwise extended pursuant to Santa Monica Municipal Code Section 9.46.090(C).

APPROVED AS TO FORM:
______________________

HEIDI VON TONGELN
Interim City Attorney

4.K.a
Packet Pg. 769 Attachment: ORD-Self-Certification IZO_2d (7479 : Self-Certification IZO - Second Reading) City Council
Report
City Council Meeting: January 13, 2026
Agenda Item: 4.L
1 of 2
To: Mayor and City Council
From: Heidi Von Tongeln, Interim City Attorney, City Attorney's Office, Administration
Subject: Second Reading and Adoption of an Ordinance Amending Santa Monica Municipal Code Chapter 8.108, Subpart B, to Amend the Construction and Demolition Material Recycling Compliance Process and to Transition from a Deposit-Based System to a Fine-Based Enforcement Approach Recommended Action
Staff recommends that the City Council adopt the attached Ordinance.

Executive Summary
At its meeting on December 16, 2025, the City Council introduced for first reading an Ordinance amending Santa Monica Municipal Code Chapter 8.108, Subpart B, to amend the construction and demolition material recycling compliance process and to transition from a deposit-based system to a fine-based enforcement approach. The ordinance is now presented to the City Council for adoption.

Prepared By: Bradley Michaud, Legal Administrative Services Officer Approved Forwarded to Council

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Attachments:

A. ORD-RRR Article 8 Amendments_Self-Cert_2d

4.L
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1 City Council Meeting: January 13, 2026 Santa Monica, California ORDINANCE NUMBER _________ (CCS)
(City Council Series)

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF
SANTA MONICA AMENDING SANTA MONICA MUNICIPAL CODE CHAPTER 8.108,

SUBPART B, TO REVISE THE CONSTRUCTION AND DEMOLITION PROCESS AND

ESTABLISH FINES FOR NON-COMPLIANCE
WHEREAS, on February 11, 2025, City Council directed staff to create a selfcertification pilot program allowing building permits for “non-structural commercial tenant improvements, single-family home improvements, and accessory dwelling units” to bypass the normal plan review process and receive approval within one to five business days; and
WHEREAS, the purpose of this direction was to facilitate the City’s economic recovery and reduce the workload on plan check professionals, allowing them to focus on the more complex projects in the City that require their attention; and WHEREAS, streamlining the review process for certain projects will facilitate business recovery and generate increased sales tax revenue for the City; and WHEREAS, the initial stages of the Self-Certification Program will focus on commercial tenant improvements, which comprise approximately 36% of the building permits submitted to the City; and
WHEREAS, Santa Monica Municipal Code (SMMC) Chapter 8.108, Subpart B regulates construction and demolition material waste management plans for covered projects, which include all construction, demolition, and deconstruction projects that require a building permit; and

4.L.a
Packet Pg. 772 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 2 WHEREAS, Construction and Demolition (C&D) waste includes materials such as concrete, asphalt, wood, metal, and drywall generated from building, renovation, and demolition projects, which accounts for 25-40% of the world’s total waste stream but is highly reusable and recyclable; and
WHEREAS, the City’s C&D waste diversion program under SMMC Chapter 8.108, requires 70% of all C&D materials to be diverted from a landfill in accordance with CalGreen Building Code requirements; and
WHEREAS, the current code applies to projects that meet certain review thresholds – $50,000.00 or 1,000 square feet for construction projects, all demolition projects, and all City sponsored projects – and requires these project applicants pay a performance security deposit upfront and submit a waste management plan detailing how the contractor will divert a minimum of 70% of C&D waste materials from a landfill; and WHEREAS, deposits are calculated as either $1.00 per square foot for demolition only permits or 3% of the total project valuation for all other projects, with a required minimum of $1,000 and a maximum of $30,000; and
WHEREAS, deposits are held until project completion and are only fully refunded if all landfill diversion requirements are met; and
WHEREAS, this deposit-based system creates large upfront costs for small businesses and homeowners and causes delays in the permitting process as staff is required to calculate the individual required deposit amounts; and WHEREAS, this deposit-based system also prohibits the implementation of a selfcertification program, as it requires staff review during the building permit review process; and

4.L.a
Packet Pg. 773 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 3 WHEREAS, this Ordinance amends the deposit-based requirements to transition from an upfront deposit-based system to a fine-based enforcement approach; and WHEREAS, under the updated system, the 70% diversion requirement will remain, but staff will now assess fines at the end of the project for non-compliance; and WHEREAS, fines will mirror the existing penalty structure, calculated as 0.3% of the total project valuation (10% of 3% of the project valuation) with a maximum $30,000.00 fine; and
WHEREAS, this change will ease the burden of upfront deposits, while still holding contractors responsible for meeting City waste diversion requirements; and WHEREAS, while some jurisdictions are still requiring deposits, many are enforcing compliance through fines or citations, including, but not limited to other local jurisdictions, such as the City of West Hollywood, City of Los Angeles, and the County of Los Angeles; and
WHEREAS, the amendments in this Ordinance will allow regional alignment to help increase consistency for contractors who work across multiple municipalities; and WHEREAS, this change will also help streamline the process for all permits by reducing the first step of project review by requiring all projects to submit a waste management plan with their building permit application, removing the financial burden of a deposit, shifting accountability to the contractor instead of small businesses and homeowners, and avoiding unnecessary administrative steps by applying fines only if that applicant fails to comply with the City’s requirements; and

4.L.a
Packet Pg. 774 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 4 WHEREAS, the amendments will also support local business retention and promote new business opportunities within the City, addressing the needs of the business community by simplifying requirements and streamlining review processes; and WHEREAS, while the proposed amendments are necessary for the selfcertification program, the amendments will also address long-standing issues that will benefit all permittees, facilitate the City’s economic recovery, streamline the building permit process for a variety of projects, and provide more transparency with respect to permit requirements.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SANTA MONICA DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. Santa Monica Municipal Code Section is hereby amended to read as set forth in Exhibit A.

SECTION 2. Any provision of the Santa Monica Municipal Code or appendices thereto inconsistent with the provisions of this Ordinance, to the extent of such inconsistencies and no further, is hereby repealed or modified to that extent necessary to effect the provisions of this Ordinance.

SECTION 3. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid or unconstitutional by a decision of any court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this Ordinance. The City Council hereby declares that it would have passed this Ordinance and each and every section, subsection, sentence, clause, or phrase not declared invalid or unconstitutional without regard to whether any portion of the ordinance would be subsequently declared invalid or unconstitutional.

4.L.a
Packet Pg. 775 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 5 SECTION 4. The Mayor shall sign and the City Clerk shall attest to the passage of this Ordinance. The City Clerk shall cause the same to be published once in the official newspaper within 15 days after its adoption. This Ordinance shall become effective 30 days from its adoption.

APPROVED AS TO FORM:
______________________

HEIDI VON TONGELN
Interim City Attorney

4.L.a
Packet Pg. 776 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 6 EXHIBIT A

4.L.a
Packet Pg. 777 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 7 8.108.110. Definitions.

For the purposes of Subpart B of this Chapter, the following definitions shall apply:
(a) “Class III landfill” means a landfill that accepts non-hazardous resources such as household, commercial, and industrial waste, resulting from construction, remodeling, repair, and demolition operations. A Class III landfill must have a solid waste facilities permit from the State of California and be regulated by an Enforcement Agency. (b) “C&D recycling center” means a facility that receives only C&D material that has been separated for reuse prior to receipt, in which the residual (disposed) amount of waste in the material is less than ten percent of the average weight of material separated for reuse received by the facility over a one-month period. (c) “City approved facility” means any facility that has been approved by the City to accept C&D material, inert material, metal recycling, universal waste, or any other materials that may be generated during a covered project. (d) “City approved hauler” means a company that possesses a valid approval letter from the City to collect and transport solid waste from individuals or businesses for the purpose of recycling or disposal.
(e) “Construction and demolition material (C&D material)” means building materials and solid waste resulting from construction, remodeling, repair, cleanup, demolition, or deconstruction operations that are not hazardous as defined in California Code of Regulations, Title 22 Section 66261.3 et seq. This term includes, but is not limited to, asphalt, concrete, Portland cement concrete, brick, lumber, gypsum wallboard, cardboard, and other associated packaging, roofing material, ceramic tile, carpeting, plastic pipe, and steel. C&D material may not be commingled with inert or organic

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Packet Pg. 778 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 8 materials resulting from land clearing and landscaping for construction or land development projects.
(f) “City-sponsored project” means a project constructed by the City or a project receiving fifty percent or more of its financing from the City. (g) “Conversion rate” means the rate set forth in the standardized conversion rate table approved by the City pursuant to this Chapter for use in estimating the volume or weight of materials identified in the waste management plan. (h) “Covered project” shall have the meaning set forth in Section 8.108.120. (i) “Deconstruction” means the process of carefully dismantling a structure, piece-bypiece, prior to or instead of conventional demolition, to maximize the recovery of building materials for reuse.
(j) “Demolition” means the decimating, razing, ruining, tearing down, or wrecking of any facility, structure, pavement, or building (wall, fence) whether in whole or in part, whether interior or exterior as further defined in Section 9.25.030. (k) “Divert” means to use material for any purpose other than disposal in a landfill or transformation facility.
(l) “Diversion requirement” means the diversion of at least seventy percent of the total construction and demolition material generated by a project via reuse or recycling, unless the applicant has been granted an exemption pursuant to Section 8.108.170, in which case the diversion requirement shall be the maximum feasible diversion rate established by the waste management plan Compliance Official in relation to the project. (m) “Inert materials” means only rock, concrete, brick, sand, soil, ceramics, and cured asphalt.

4.L.a
Packet Pg. 779 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 9 (n) “Organic material” means any vegetative material resulting from land clearing or landscaping for construction or land development projects. (o) “Project” means any activity which requires an application for a building or demolition permit or any similar permit from the City.
(p) “Recycling” means the process of collecting, sorting, cleansing, treating, and reconstituting materials for the purpose of using the altered form in the manufacture of a new product. Recycling does not include burning, incinerating, or thermally destroying solid waste.
(q) “Reuse” means the use, in the same or similar form as it was produced, of a material which might otherwise be discarded.
(r) “Separated for reuse” means materials, including commingled recyclables, that have been separated or kept separate from the solid waste stream for the purpose of additional sorting or processing of those materials for reuse or recycling in order to return them to the economic mainstream in the form of raw material for new, reused,; or reconstituted products which meet the quality standards necessary to be used in the marketplace, and includes source separated materials.
(s) “Solid waste” as per Public Resources Code Section 40191 means all putrescible and non- putrescible solid, semisolid, and liquid wastes, including garbage, trash, refuse,; paper, rubbish, ashes, industrial wastes, demolition and construction wastes, abandoned vehicles and parts thereof, discarded home and industrial appliances, dewatered, treated, or chemically fixed sewage sludge which is not hazardous waste, manure, vegetable or animal solid and semisolid wastes, and other discarded solid and semisolid wastes. "Solid waste" does not include any of the following wastes:

4.L.a
Packet Pg. 780 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 10 (1) Hazardous waste, as defined in PRC Section 40141; (2) Radioactive waste regulated pursuant to the Radiation Control Law (Chapter 8 (commencing with Section 114960) of Part 9 of Division 104 of the Health and Safety Code);
(3) Medical waste regulated pursuant to the Medical Waste Management Act (Part 14 (commencing with Section 117600) of Division 104 of the Health and Safety Code).
(t) “Source separated materials" means materials that are sorted at the site of generation by individual material type including commingled recyclable materials for the purpose of recycling; i.e., loads of concrete that are source-separated for delivery to a recycling facility.
(u) “Universal waste” means hazardous waste that is identified as universal waste in section 66273.9 of Title 22 of the California Code of Regulations and is not fully regulated as hazardous waste in accordance with chapter 6.5 of Division 20 of the California Health and Safety Code. Examples of universal waste include, but are not limited to, electronic devices, batteries, fluorescent lamps, mercury thermostats, and other mercury containing equipment.
(v) “Waste management plan (WMP)” means a completed waste management plan, approved by the City for the purpose of compliance with this Chapter, submitted by the applicant for any project requiring a building permit.
(w) “Waste management plan compliance official” means the City staff tasked with enforcement of this Subpart.

8.108.120. Covered projects.

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Packet Pg. 781 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 11 (a) Private Projects. All construction, demolition, and deconstruction projects requiring a building permit shall be considered covered projects. (b) City-Sponsored Projects. All City-sponsored construction, demolition and renovation projects shall be subject to this Chapter, and consequently, shall be considered covered projects.

8.108.130. Submission of a waste management plan.
(a) WMP Forms. Applicants for construction or demolition permits involving a covered project shall complete and submit a waste management plan approved by the City for this purpose, as part of the application packet for the construction or demolition permit. The completed WMP shall indicate all of the following:
(1) The estimated volume or weight of the project C&D material, by material type, to be generated;
(2) The maximum volume or weight of such materials that can feasibly be diverted via reuse or recycling;
(3) The vendor or facility where the applicant proposes to use to collect or receive that material;
(4) The estimated volume or weight of C&D materials that will be landfilled in Class III landfills and inert disposal facilities; and
(5) A commitment that only City permitted waste haulers would be used. (b) Calculating Volume and Weight of Material. In estimating the volume or weight of materials identified in the WMP, the applicant shall use the conversion rates approved by the City for this purpose.

8.108.140. [Reserved].

4.L.a
Packet Pg. 782 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 12 § 8.108.150. Submission of a WMP.

Requirements. Notwithstanding any other provisions of this Code, no building or demolition permit shall be issued for any covered project unless and until the WMP has been submitted and approved. Approval shall not be required, however, where an emergency demolition is required to protect public health or safety. The WMP must contain the following elements:
(1) All of the information set forth in Section 8.108.130. (2) Explanation of how at least seventy percent of all C&D material, one hundred percent of inert materials, one hundred percent of organic materials, and all universal waste generated by the project will be diverted through source separation or an exemption has been approved pursuant to Section 8.108.170.

8.108.160. Compliance with WMP.
(a) Documentation. Prior to applying for final inspection on the project, the applicant shall submit to the WMP Compliance Official the following documentation showing that it has met the diversion requirement for the project:
(1) Weight tickets from the City approved facility which collected or received each material showing the actual weight or volume of that material; (2) Weight slips/count of material salvaged or reused in current project; and (3) Any additional information the applicant believes is relevant to determining its efforts to comply in good faith with this Chapter.
(b) Weighing of Wastes. Applicants shall ensure that all C&D material diverted or landfilled are measured and recorded using the most accurate method of measurement available. To the extent practical, all C&D material shall be weighed by measurement on

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Packet Pg. 783 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 13 scales. Such scales shall be in compliance with all State and County regulatory requirements for accuracy and maintenance. For C&D material for which weighing is not practical due to small size or other considerations, a volumetric measurement shall be used. For conversion of volumetric measurements by weight, the applicant shall use the standardized conversion rates in a format approved by the City. (c) Determination of Compliance and Penalties. The WMP Compliance Official shall review the information submitted under subsection (a) of this Section to determine whether the applicant has complied with the diversion requirement as follows:
(1) Full Compliance. If the WMP Compliance Official determines that the applicant has fully complied with the seventy percent diversion and all other sections or provisions of this Chapter applicable to the project, they shall remove the hold on the building permit’s final inspection with no penalty.
(2) Failure to Comply. If the WMP Compliance Official determines that the seventy percent diversion requirement, and/or any other applicable provision of this Chapter, has not been met, a fine not exceeding three percent of the total project valuation, with a minimum of five hundred dollars, and a maximum of thirty thousand dollars, shall be assessed pursuant to subdivisions (A) and (B) below, and in accordance with Chapter 1.09. Once the fine has been paid in full, the hold on the building permit’s final inspection shall be removed. (A). Fine Categories. Failure to comply with any of the following may result in a fine calculated as set forth in subdivision (B) of this section:
(i.) Any project completed without an approved WMP as defined in section 8.108.110

4.L.a
Packet Pg. 784 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 14 (ii) The use of a non-City approved hauler as defined in section

8.108.110
(iii) The use of a non-City approved facility as defined in section

8.108.110
(iv) Weight tickets dated prior to the WMP approval date (v) Failure to meet the required diversion rate as defined in section 8.108.110
(vi) Altered or fraudulent weight tickets as determined by the WMP Compliance Official
(B). Fine Amounts.
(i) Fines in subdivision (A)(i), (A)(ii), (A)(iii), and (A)(iv) of this section shall be assessed as ten percent of the maximum fine or five hundred dollars, whichever is greater.
(ii) Failure to meet the required diversion rate as noted in subsection (A)(v) shall result in a prorated fine based on the amount of waste diverted and is calculated as follows: (3% of project valuation) – ((Achieved diversion rate/Required diversion rate) * (3% of project valuation)).
(iii) Any projects that are found to have altered or fraudulent weight tickets as noted in subsection (A)(vi) are subject to the maximum fine not exceeding three percent of the total project valuation with a maximum of thirty thousand dollars.

4.L.a
Packet Pg. 785 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 15 Table 8.108.160: Range of Fines
Project Valuation Minimum penalty Maximum penalty
$10,000.00 $500.00 $500.00
$100,000.00 $500.00 $3,000.00
$1,000,000.00+ $3,000.00 $30,000.00

8.108.170. Exemption.
(a) Application. If an applicant believes it is infeasible to comply with the diversion requirements of this Chapter due to the circumstances delineated in this Section, the applicant may apply for an exemption at the time that they submits the required WMP.

Exemptions may be granted based on the following considerations:
(1) Lack of storage space on-site;
(2) Contamination by hazardous substances;
(3) Low recyclability of specific materials.

The applicant shall indicate on the WMP the maximum rate of diversion they believe is feasible for each material and the specific circumstances that they believes make it infeasible to comply with the diversion requirement.
(b) Granting of Exemption. If the WMP Compliance Official determines that it is infeasible for the applicant to meet the diversion requirement due to unique circumstances, they shall determine the maximum feasible diversion rate for each material and shall indicate this rate on the WMP submitted by the applicant. (c) Denial of Exemption. Upon a denial by the WMP Compliance Official, the applicant shall have thirty days to resubmit a WMP form in full compliance with Section

8.108.130. If the applicant fails to resubmit the WMP, or if the resubmitted WMP does not comply with Section 8.108.130, the WMP Compliance Official shall deny the WMP.

8.108.180. Appeal.

4.L.a
Packet Pg. 786 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) 16 The applicant or any interested person may appeal to a Hearing Officer from any ruling of the WMP Compliance Official made pursuant to this Chapter in accordance with Section 6.16.030. Notice of any appeal from the ruling of the WMP Compliance Official must be filed within ten days of the date that such ruling is made.

8.108.190. Enforcement.
(a) The City Attorney may enforce the provisions of this Subpart by means of a civil action.
(b) Any person who violates any provision of this Subpart shall be subject to administrative fines and administrative penalties pursuant to Chapters 1.09 and 1.10 of this Code.
(c) Nonexclusive Remedies and Penalties. The remedies provided in this Subpart are not exclusive, and nothing in this Subpart shall preclude any person from seeking any other remedies, penalties or procedures provided by law. (d) It shall not be a defense to the assessment of any penalty or to any other civil or administrative enforcement action provided for under this Section for a person to assert that any violation of this Subpart was caused by the actions of a person other than the person assessed except if the violation was caused by the criminal or negligent action of a person who was not an agent, servant, employee or family member of the person. (e) Any penalty collected hereunder shall be deposited in the Resource Recovery and Recycling Fund to be used as reimbursement for the Public Works Department's costs and expenses of administration and enforcement of this Chapter.

4.L.a
Packet Pg. 787 Attachment: ORD-RRR Article 8 Amendments_Self-Cert_2d (7480 : RRR Article Amendments - Second Reading) City Council
Report
City Council Meeting: January 13, 2026
Agenda Item: 4.M
1 of 5
To: Mayor and City Council
From: Anuj Gupta, Director of Transportation, Department of Transportation, Transit Maintenance
Subject: Award Bid # 4506 to A and A Fleet Painting, Inc. for Bus Body and Paint Repairs
Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of Categorical Exemption pursuant to Section 15301 (Existing Facilities) and a finding of no possibility of significant effects pursuant to Section 15061(b)(3) of the California Environmental Quality Act (CEQA) Guidelines;

2. Award Bid # 4506 to A and A Fleet Painting, Inc. for transit bus body repairs and painting services for the Department of Transportation; and

3. Authorize the City Manager to negotiate and execute an agreement with A and A Fleet Painting Inc., in an amount not to exceed $3,437,363, including a 10% contingency, for a five-year period, with future year funding contingency on Council budget approval.

Summary
Big Blue Bus, a division of the Santa Monica Department of Transportation (DOT), operates 195 transit buses across 69 square miles of greater Los Angeles, providing an average of 820,000 rides while traveling 390,000 miles each month. While in service, transit buses experience body damage resulting from normal wear, road damage, and accidents that necessitate repair and painting services. Bus body repair services are required to ensure that buses can be repaired and returned to service in a timely manner. Staff recommends Bid #4506 be awarded to A and A Fleet Painting, Inc., to provide body repair and painting services for transit buses in an amount not to exceed $3,437,363 for a five-year period.

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Discussion
Transit buses experience wear and damage to their body panels, structure, painted surfaces, and branding decals during normal operation from normal road damage and wear, contact with fixed structures and trees, and traffic collisions. This damage may result in repainting or replacement of body panels, replacement of branding decals, or major structural repair work in order to return the transit bus to good operating condition.

DOT staff perform minor body repairs; however, major repairs and paintwork exceed DOT’s capacity to repair in-house. Painting of transit buses must be completed in an enclosed paint booth that complies with applicable safety and environmental regulations. Additionally, repairing structural accident damage requires specialized facilities and tooling. Bid #4506 requires that the vendor provide all equipment, facilities, and materials necessary to paint, repair, and replace transit bus panels and structural components including a fully enclosed paint booth that complies with applicable Federal, State, and local rules and regulations.

The bid award would enable the City to repair transit bus body damage in a timely manner, minimizing vehicle down time. Staff recommends Bid #4506 be awarded to A and A Fleet Painting, Inc. for transit bus body repair and painting services.

Vendor Selection
Bidder Recommendation
Best Bidder A and A Fleet Painting, Inc.

Evaluation Criteria
Price, experience, capacity and skill of the bidder to perform the services; the capacity of the bidder to perform provide the service promptly, within the time specified, and without delay.

Municipal Code SMMC 2.24.180
Submittals Received
A and A Fleet Painting $3,437,363 Complete Coach Works NO BID CG, Inc. $3,988,600 Fleet Collision Center, Inc. $4,441,157 Bid Data
Date
Posted Posted On Advertise In
(City Charter & SMMC)
Vendors
Downloaded
Date Publicly
Opened

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10/10/2025
City's Online
Bidding Site
Santa Monica Daily
Press 18 11/3/2025
Best Bidder Justification
Bid #4506 was evaluated by the evaluation committee from the Department of Transportation, Transit Maintenance Division. A and A Fleet Painting Inc. is able to provide all services and comply with all specifications required under Bid #4506, and their references provided positive feedback regarding the quality and timeliness of their work, as well as their experience providing painting and bus body repairs for 40- foot and 60-foot transit buses. A and A Fleet Painting has experience performing bus body repairs for large transit agencies including Los Angeles County Metropolitan Transit Authority (LACMTA), OmniTrans, Foothill Transit, and Anaheim Regional Transportation. References interviewed by staff credited A and A with fast response times, good work quality, and clear, accurate estimates provided in a timely manner.

A and A Fleet Painting Inc. is evaluated to be equal to the incumbent vendor based on their experience, capacity and skill to perform the bid services, and capacity to provide prompt service without delay and is the lowest cost bidder and agreed to a firm-fixed contract for five years, offering cost savings to the City. Based on their equal performance on experience and ability to perform the work and their low cost, A and A Fleet Painting, Inc. is recommended as the best bidder.

Protest
On November 18, 2025, City staff notified bidders of staff’s intention to recommend A and A Fleet Painting, Inc. as the best bidder of bid #4506 for transit bus body repairs and painting services. On November 25, the Finance Director received a timely protest from CG, Inc. On December 4, after conducting a full investigation into the merits of the protest, the Finance Director determined the protest claims were unsubstantiated and denied the protest.

Based on the Finance Director’s final determination denying the protest, staff recommends Bid #4506 be awarded to A and A Fleet Painting, Inc. for transit bus body repairs and painting services.

Environmental Review
The contract for transit bus body repairs and painting services is categorially exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15301 (Existing Facilities) and Section 15061(b)(3) of the CEQA Guidelines. Section 15301

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exempts Class 1 (Existing Facilities) projects from CEQA, which includes the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or former use. The repair and painting of transit bus body components would not result in any modifications to existing maintenance facilities and would not expand or materially change existing maintenance operations or increase the City’s fleet of transit buses. Therefore, this is categorically exempt as set forth in Section 15301 of the CEQA guidelines. Additionally the contract is exempt from CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines, which states that CEQA does not apply, “where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.” The contract would provide for bus body repairs and services, and would not have a physical impact on the environment.

Financial Impacts and Budget Actions
Staff seeks authority to approve available funding from the Big Blue Bus fund to award a contract with A and A Fleet Painting, Inc. for repair and painting of transit bus body components.

Contract Request
FY 2025-26
Request
Amount
Future Years
Amount Department/CIP Account # Total Contract Amount
$206,242 $1,856,176 60600008.550012 $2,062,418
$137,495 $1,237,450 C6004750.689000 $1,374,945
Total $3,437,363
Future year funding is contingent on Council budget approval.

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Prepared By: David Nanjo, Administrative Analyst
Approved Forwarded to Council
Attachments:

A. A and A Fleet Painting OAKS
B. A and A Levine Act_Updated
C. Protest Letter - BID 4506 - CG Inc.

D. Protest City Response - BID 4506 - CG Inc.

4.M
Packet Pg. 792
















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Abel Bautista President
11-18-25
[email protected] (562)2540-0721
A and A Fleet Painting Inc
Abel Bautista
Abel Bautista - President; Veronica Bautista - CEO; Alexis K. Barajas - Treasurer; Cristian Barajas - COO

4.M.a
Packet Pg. 793 Attachment: A and A Fleet Painting OAKS (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica Levine Act Disclosure Form

CITY OF SANTA MONICA

CALIFORNIA LEVINE ACT DISCLOSURE
The Levine Act prohibits City Officers from participating in any action related to a contract, license, permit, or entitlement if such Officer received campaign contributions totaling more than $500 within the previous twelve months, and for twelve months following the date of a final decision, from a party or participant to the proceeding, or their agent.

Section 84308(a)(4) of the Levine Act defines an "Officer" as follows: “Officer” means any elected or appointed officer of an agency, any alternate to an elected or appointed officer of an agency, and any candidate for elective office in an agency. The term “Officer” is further defined 2 Cal.

Code Regs. Section 18438.1, which states:

An officer of an agency includes only those persons who make, participate in making, or in any way attempt to use their official position to influence a decision in the license, permit, or entitlement for use proceeding, or who exercise authority or budgetary control over the agency or officers who may do so, and:
(1) Serve in an elected position, including an official appointed to an elected position due to an interim vacancy or an election otherwise canceled because the official was the sole candidate for the position;
(2) Serve as a member of a board or commission;
(3) Serve as the chief executive of a state agency, or county, city or district of any kind; or (4) Have decision making authority with respect to the proceeding involving a license, permit, or other entitlement for use and is also a candidate for elected office or has been a candidate for elective office in the 12 months prior to the proceeding.

A list of Santa Monica Elected Officials and members of boards and commissions can be found at the following links. The party making this certification is responsible for determining whether a recipient of a political contribution is a City Officer prior to completing this form. https://www.smgov.net/departments/council/
https://www.santamonica.gov/departments/rent-control
https://www.smgov.net/boards/
Have you, your company, or any agent on behalf of you or your company, made any political contributions of more than $500 to any City Officer in the twelve months preceding the date of the submission of your application or proposal? ____YES ____ NO
Name of Councilmember or City Officer: _________________________________ Name of Contributor: _________________________________________________ Date(s) of Contribution(s): ____________________________________________ Amount(s) ________________________________________________________ Please specify below and/or add additional sheet(s) to identify additional Councilmembers or City Officers to whom you and/or your agents made campaign contributions.

4.M.b
Packet Pg. 794 Attachment: A and A Levine Act_Updated (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica Levine Act Disclosure Form
Answering YES does not preclude the City of Santa Monica from awarding a contract, license, permit, or entitlement or taking any subsequent action related to the item. It does, however, preclude the identified City Officer from participating in any actions related to such item.

By signing below, you certify you also agree to disclose to the City any future contributions made to Councilmembers or other City Officers by you or your agent(s) after the date of signing this disclosure form, and within 12 months following the approval, renewal, or extension of the requested contract, license, permit, or entitlement.

I HEREBY CERTIFY UNDER PENALTY OF PERJURY UNDER THE LAWS OF THE STATE OF CALIFORNIATHAT THE FOREGOING IS TRUEAND CORRECT.

Signed: ____________________________ Date: ____________________ Print Name: _________________________ Title: _____________________ Company: __________________________
Additional Disclosures:

Please note this form is a public record and subject to a California Public Records Act request.

4.M.b
Packet Pg. 795 Attachment: A and A Levine Act_Updated (7417 : Award Bid for Bus Body and Paint Repairs) 167490537.6
Notice of Protest of CG, Inc.
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LEWIS BRISBOIS BISGAARD & SMITH LLP
JOSHUA S. HODAS, SB# 250802
[email protected]
TAMARA McNULTY (Washington D.C. Bar No. 1022637)
[email protected]
GARRETT A. DEAN (Colorado Bar No. 41924)
[email protected]
MARIA K. SHOCKLEY (Tennessee Bar No. 40528)
[email protected]
2112 Pennsylvania Avenue NW, Suite 500
Washington, DC 20037
Telephone: 202.558.0655
Facsimile: 202.558.0654
Attorneys for Carlos Guzman, Inc.

BEFORE THE CITY OF SANTA MONICA

OFFICE OF THE CITY MANAGER
Carlos Guzman, Inc.,
Petitioner,
vs.

City of Santa Monica (Department of
Transportation0,
Respondent.

Bid ID: 4506
Project #194716
NOTICE OF BID PROTEST BY CARLOS GUZMAN. INC.

INTRODUCTION
On behalf of Carlos Guzman, Inc. (CGI), its attorneys, Lewis Brisbois Bisgaard and Smith, LLP, brings this bid protest pursuant to Santa Monica Municipal Code (“SMMC”) § 2.24.260. This protest arises from and challenges the arbitrary and capricious evaluation and scoring of proposals in response to the request for proposals on Bid ID: 4506 / Project #194716 (the “RFP”) (Exhibit A)—an important procurement to provide Transit Bus Body and Paint Repairs (the “Project”) to the City of Santa Monica Department of Transportation (“SMDOT”).

4.M.c
Packet Pg. 796 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) 167490537.6 2
Notice of Protest of CG, Inc.
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I. THE SOLICITATION AND BID CALENDAR
On Friday October 10, 2025, SMDOT posted its release of the Project. SMDOT sought bids to provide body repair and painting services to its fleet of transit buses including 30', 40', and 60' buses. Exhibit A § 2.1.

SMDOT set several deadlines associated with the RFP. It set the Question Submission Deadline for October 16, 2025, 3:00pm. SMDOT instructed that questions were to be submitted online in the “Q&A” tab. It stated that the City would only accept or respond to questions submitted through the online vendor portal. SMDOT also set the Question Response Deadline for October 27, 2025, 3:00pm. Finally, SMDOT set the Bid Submission Deadline for November 3, 2025, 3:00pm.

Id., § 2.3. SMDOT published its Notice of Award on November 18, 2025. See Results (Exhibit B).

The deadline to file a protest was seven calendar days. Exhibit A § 3.14 The RFP stated:

The award, if any, will be made to the best bidder(s). In evaluating whether a bidder(s) is (are) the best bidder(s) pursuant to the Santa Monica Municipal Code, City may utilize some or all of the following criteria:
(1) Price.
(2) The quality of the material or services offered.
(3) The ability, capacity, and skill of the bidder(s) to perform the contract or provide the materials or services.
(4) The capacity of the bidder(s) to perform the contract or provide the service promptly, within the time specified, and without delay or interference.
(5) The sufficiency of the bidder’s financial resources. (6) The character, integrity, reputation, judgment, training, experience, and efficiency of the bidder.
(7) The ability of the bidder(s) to provide such future maintenance or service as may be needed.
(8) Any other factor which will further the intent set forth in Section 608 of the City Charter.

The City of Santa Monica (the “City”) shall have absolute discretion in determining the applicability and weight or relative weight of some or all of the criteria listed above and is not required to select the lowest monetary bidder. Exhibit A, § 3.2 (Emphasis added).

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In the RFP, SMDOT stated that “Bids are awarded based on the best bidder and may be contingent upon City Council approval.” It went on to state that “Bids are evaluated based on pricing, availability, experience, and references.” Exhibit A, §11.5 (emphasis added). It is notable that the one thing SMDOT did not provide as part of the RFP was any discussion of what method it would use to score proposals and the weight the scores would be given (as seen in this table):1 Exhibit A § 15.

SMDOT clearly laid out the Scope of Work on the Project, in pertinent part, as follows:

Provide body and repair services for City of Santa Monica Department of Transportation (SMDOT) fleet of transit buses including, but not limited to, complete bus repainting, body repairs and interior painting and refinishing; fabrication of interior and exterior panels, stanchions and other related components and parts.

Provide bus pick-up and delivery service for all bus types.

Pick-up and delivery shall be from SMDOT (1620 6th Street Santa Monica CA, 90401) to bidder location and from bidder back to SMDOT.

Digital pictures of before and after body repairs must be available for a minimum of three years. Provide a report including pictures of vehicle initial condition, mid-repair, and finished repairs upon completion of work
Provide an estimate prior to beginning work on any SMDOT vehicles, estimate must be approved by the Transit Vehicle Maintenance Superintendent or designee prior to beginning work.

All body and paint repairs shall be preauthorized by the SMDOT.

Buses that are in the process of repair shall be made
available for inspection at any point during the repair process.

Proof of purchase documents, including packing slips and invoices shall be made available upon request from SMDOT Transit Maintenance Supervisor.

Subcontractors perform any part of bus body repair services.

The contractor must submit written request for approval of subcontractors indicating the scope of work to be performed by the proposed subcontractor.
***
1 This is highly unusual in public procurements.

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DESCRIPTION OF WORK EXPECTED
All areas with rust corrosion shall be stripped of paint, rustproofed, filled in or sectioned with new material, sanded, primed, and bus repainted to Santa Monica's bus colors. Roofs and anodized aluminum areas excluded.

Repair of accident and other body damage when requested by the Transit Vehicle Maintenance Superintendent or his designee.

All repairs and painting shall conform to OEM
specifications, including product specifications and bus builder specifications.

Santa Monica may provide some bus body parts. However,
the contractor may have to supply body panels and parts, decals and/or fabricate parts that are no longer available from bus manufactures. All miscellaneous supplies such as fasteners, paint, masking tape, and other commonly stocked items will be supplied by bidder.

All rusted areas shall be treated with a chemical treatment that bonds with the remaining traces of rust to stop further rusting from happening.

Body panels shall be installed in a uniform manner using OEM approved materials and methods.

Fit and finish shall meet or exceed OEM specification.

The use of double stick tape shall only be used in areas that are approved by the OEM.

All decals, interior and exterior shall be installed prior to delivery of the bus. Buses with decals out of place and/or missing will not be accepted and must be corrected by the contractor.

Buses shall be picked up and delivered back to Santa Monica Big Blue Bus located at 1620 6th Street, Santa Monica. Contractor will be required to show that they have staff with a current commercial driver’s license and the necessary licensing and insurance coverage to transport 30’, 40’ and 60’ transit buses as required by Federal, State and local Laws, Rules and Regulations.

Contractor must dispose of all hazardous waste in
accordance to Local, State and Federal rules, laws and regulations governing the disposal of hazardous waste. Id., § 4.1
Finally in the Vendor Requirements Section, SMDOT stated, in pertinent part that:

Bidder must have a fully enclosed paint booth in their
facility; all painting shall be performed in a paint booth. Bidder must have the ability to accommodate painting of 60’ buses in compliance with applicable Federal, State and local laws, rules and regulations.
***
Bidder must have a minimum of five (5) years of full-time experience repairing and painting transit coach body damage caused by collision, rust, aging, and/or any interior and exterior damage. Bidder must have experience performing body repairs and

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painting on transit buses.
***
Bidders must provide, as part of your bid, an experience statement including a list of clients and the size of the bidders [sic] contracts with those clients. Id., § 4.2 (Emphasis added).

In short, SMDOT wanted highly qualified and experienced vendors for the work.

With respect to costs the vendors were to fill out two tables where the first three columns were filled out by SMDOT and the Vendors were to provide the Unit Costs and total by multiplying the unit cost with the “estimated” quantity of the work to be performed. The tables were provided with the RFP and also as excel spreadsheets to be downloaded and filled out by the bidder.

The first table was titled “Bus Body Repair” and was provided as follows:

The second table was titled “Other Costs” and was provided as follows:

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II. THE BID AND THE NOTICE OF AWARD
CGI timely submitted its Proposal on November 3, 2025. Exhibit B. CGI’s paint samples were submitted timely for testing along with its proposal.

On November 18, 2025, SMDOT issued its Notice of Award. See Exhibit C. It provides that SMDOT intends to award the contract resulting from the RFP to A&A Fleet Painting, Inc. (A&A).

This intention arises from the offerors having received the following scores during the bid review:

See Exhibit C.

On the Results section of the RFP website, SMDOT also posted the pricing provided by A&A, CGI and Fleet Collision Center, Inc.’s (the third, and lowest-ranked bidder) but not the comments sections for any of the bidders. The pricing provided by each offeror in the Bus Body Repair and Other Costs spreadsheets was as follows (see Exhibit C):

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III. TIMELINESS AND STANDING
This protest is submitted by the November 25, 2025 filing deadline set by SMDOT, and is, therefore, timely. See SMMC § 2.24.260(a). CGI is an actual bidder with a direct economic interest in the procurement that would “potentially be in line for award if the protest were sustained” and as a result, CGI is an “interested supplier” with the right to protest pursuant to SMMC § 2.24.260(b).

IV. CGI’S BACKGROUND AND EXPERIENCE AND ABILITY TO PERFORM THIS CONTRACT VASTLY EXCEED A&A’S
As shown on the two pricing forms posted by SMDOT, CGI’s price was marginally higher than A&A’s price. As shown in the Results, A&A was ranked the same in experience as CGI at 50.

As discussed below, there are certain issues with the evaluation of A&A’s pricing. See Exhibit C The truly glaring issue here, however, is that the two offerors were assigned identical 50-point experience values in spite of CGI’s actual experience in the relevant areas being almost incomparably greater.

A. CGI’s Background and Experience
CGI is a Southern California Corporation established in 1984, providing accident estimations & assessments for nationwide Bus and Rail Transportation. It has been in business for 41 years, providing repaint, accident damage repair, and renovation services to transit agencies. CGI works with City, State, Federal and private transportation organizations throughout the United States. See Exhibit B, pg. 1. This is CGI’s only business.

CGI employs and contracts highly trained staff which includes structural, electrical, mechanical, air brake, hydraulic, powertrain, structural car body, specialty welding, and paint expertise. CGI works hard to assure its customers the highest level of consistency and timely completion of projects. Id.

CGI has nineteen artisans, technicians and engineers whose full-time jobs are the repair and refurbishment of buses and railcars. Combined, they have over 250 years of experience in such work.

CGI has a fully enclosed, AQMD-permitted paint booth in their facility that is capable of accommodating the painting of 60’ buses in compliance with applicable Federal, State and local laws, rules and regulations—as is required in the RFP.

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Significantly, CGI has had contracts with Santa Monica to do exactly the work covered by this contract for the past 25 years, and the city’s multiple renewals of its contracts for this work speaks volumes as to the city’s satisfaction with CGI’s work. CGI has 12-14 non-administrative employees assigned full-time to the Santa Monica work; all of whom are deeply familiar with the City’s requirements and needs because they have each been working for years on this project.

Indeed, a number of those artisans, technicians and engineers have worked exclusively on Santa Monica’s buses for over two decades, and none have been on the project for less than seven years.

It is also important to note that CGI is the premier painter of transit vehicles in the country.

It has been said that if you want your vehicle to look like it just rolled off the Ferrari assembly line, CGI is the company that provides that level of painting expertise. This is demonstrated by the fact that Axalta (formerly Dupont), the supplier of the paints and finishes used on the Santa Monica buses, has extended a ten-year warranty on its paints and finishes when they are applied by CGI.

CGI is the only company in the United States through which Axalta offers a ten-year warranty.

Because of the respect held for CGI in the industry, it has also been chosen as the exclusive distributor for Hubner vehicle-articulation-joint units and parts to the aftermarket in the United States. A large number of Santa Monica buses employ these joints and SMDOT regularly needs them to be refurbished or replaced. CGI has experience (as well as direct access to Hubner engineers) unequaled in the United States regarding such work.

Finally, as set forth in the bid exhibits, CGI has substantial experience with performing contracts of this size, and larger, for transit agencies all across the country. See CGI work history (Exhibit D).

B. A&A’s Background and Experience
A&A’s experience with projects of this type could not be more starkly different from CGI’s.

A&A has only been in business for 22 years and does not work exclusively in, or even specialize in, transit vehicle repair, refurbishment and painting, as CGI does. 2 2 While A&A apparently has done some limited work on behalf of local transit agencies, its own advertising describes it as primarily working on cars, trucks and recreational vehicles, as seen in the below paid Google advertising placement:

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Crucially, on information and belief (and as set forth in greater detail below), A&A does not have a fully enclosed paint booth at its facility of sufficient size to paint a 60’ bus as required by the RFP.

Upon information and belief, A&A is a much smaller company with few if any employees with anywhere near the experience in transit vehicle repair, refurbishment and painting as even the most junior of the CGI employees already working on Santa Monica buses.

And, of course, it has no experience at all with the specific needs and operations of the Santa Monica agency and facility. Nor can it provide the ten-year manufacturer-backed paint warranty from Axalta, or the benefits of CGI’s direct relationship with (and expertise in) Hubner articulation joints, both of which are central needs in connection with this contract.

Further, A&A does not appear to have experience with projects of this size, as required in the RFP (See Exhibit A §§ 4.2 and 13.15) and only has experience with smaller projects. See State of California work history of A&A (Exhibit E).

Finally, on information and belief, based on the short bid-review process, any paint samples that may have been submitted by A&A have not been formally tested by SMDOT to confirm that they meet the needs of the City of Santa Monica Big Blue Bus. SMDOT, in contrast, has twentyfive years of experience with the quality and longevity of CGI’s paint work.

Its Instagram page at https://www.instagram.com/thepaintdeparment/ depicts only cars and RVs.

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SUBSTANTIVE GROUNDS FOR PROTEST
I. STANDARD OF REVIEW
The review of a local entity’s legislative determination is through ordinary mandamus with the “ultimate questions” being “whether the agency’s decision was arbitrary, capricious or entirely lacking in evidentiary support, contrary to established public policy or unlawful or procedurally unfair.” Mike Moore’s 24-Hour Towing v. City of San Diego, 45 Cal. App. 4th 1294, 1303 (Cal. 4th D.C.A. 1996). Factual findings by the public entity are given deference “when they are supported by substantial evidence.” Eel River Disposal & Resource Recovery, Inc. v. County of Humboldt, 221 Cal. App. 4th 209, 224 (Cal. 1st D.C.A. 2013).

II. THE EVALUATION COMMITTEE’S ACTIONS WERE ARBITRARY AND CAPRICIOUS,

ENTIRELY LACKING IN EVIDENTIARY SUPPORT, AND PROCEDURALLY UNFAIR A. Because This Procurement Was Sought Under Santa Monica Municipal Code § 2.24.220 (Formal Procedures) the Failure to Provide the Scoring for Cost and Experience, or the Weight to Be Given These Two Scores, is Arbitrary, Capricious and Procedurally Unfair.
“Generally, a public entity’s failure to use correct and exclusive criteria to award a public contract may constitute an abuse of discretion.” Cypress Security, LLC v. City and County of San Francisco, 184 Cal. App. 4th 1003, 1011 (Cal. Ct. App. 2010). The failure of SMDOT to include the information for the evaluation criteria leave open the question of whether it used exclusive criteria. SMDOT’s failure to tell the bidders, in the RFP, how the two criteria of Experience and Cost were to be scored, as well as the failure to tell bidders how these scores would be rated, resulted in a process that was opaque and not in accordance with the City’s own Municipal Code that Procurements be competitive. See Santa Monica Public Charter Article VX § 1508 (2025). When contracting for contractual services over $250,000 the formal procurement procedures apply. See SMMC § 2.24.130(b)(3). The formal procurement procedures are as follows:
(a) The Purchasing Agent shall issue a formal notice inviting bids or request for proposals and shall solicit bids and proposals by:

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(1) Advertising in a newspaper of general circulation in the City of Santa Monica on at least two occasions, the first of which shall be at least ten days before the time for opening received bids; and (2) Posting on the City's online vendor portal website. The Purchasing Agent may require additional notice as the Purchasing Agent determines to be in the best interest of the City. (b) At the time specified in the notice inviting bids or request for proposals, all bids or proposals timely received shall be opened and declared publicly, either in person or through the City's online vendor portal website. (c) The Purchasing Agent shall compile and tabulate all bids or proposals timely received and refer them to the appropriate City Department for evaluation. For public works contracts or purchases of goods or contractual services, the City Department shall make a recommendation of best bidder by applying the criteria set forth in Section 2.24.180… SMMC § 2.24.220 (emphasis added).

While the City has the absolute right to set the applicability and weight of the criteria, it is anathema to a fair and competitive process to hide the points values and the weight of the state criteria. Thus, this procurement was procedurally unfair and non-competitive in its best-buyer selection.

B. Ranking Of CGI And A&A’s Experience Equally—Including the Capacity to Perform this Work in Compliance With the RFP, and all Relevant Laws— Was a Substantial Failure.

Given the vast disparity between CGI and A&A’s capabilities, skill and experience in this business generally, and with Santa Monica’s buses, operations and needs, in particular, it is, frankly, unfathomable that CGI and A&A were given the same ranking of 50 in the “experience” portion of the evaluation. If CGI is a 50, then A&A is stretching for 20.3

1. A&A Lacks Experience in the Field of this Contract as Compared to CGI As stated above CGI has decades more experience with bus repair projects of the size and scope that SMDOT expected when it said in the RFP that “Bidder must have a minimum of five (5) years of full-time experience repairing and painting transit coach body damage caused by collision, rust, aging, and/or any interior and exterior damage. Bidder must have experience performing body 3 Given the highly condensed schedule that SMDOT gave itself to review these proposals it is clear that the proposals were not reviewed in adequate depth.

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repairs and painting on transit buses.” Indeed, CGI has over a dozen employees dedicated to the Santa Monica contract that each of these employees have between seven and twenty-five-years’ experience working full-time on Santa Monica buses.

Based on CGI’s research, A&A does not have much experience performing body repairs and painting of “transit buses.” CGI, in contrast, has decades of extensive experience with such work, and performs this and similar work in long-term contracts for transit systems across the country. On information and belief, A&A has never had any projects, even remotely the size of this project. This should have been clear to the evaluation committee since SMDOT required an “Experience Statement” as part of the bid submission See Exhibit A § 3.12. 4 2. A&A Does Not Have a Fully Enclosed Paint Booth Capable of Accommodating a 60’ Bus as Required by the RFP
CGI is also superior to A&A because it has a fully enclosed paint booth of the size required in the RFP and A&A does not. In the exact wording of the RFP: the “Bidder must have a fully enclosed paint booth in their facility; all painting shall be performed in a paint booth. Bidder must have the ability to accommodate painting of 60’ buses in compliance with applicable Federal, State and local laws, rules and regulations.” CGI’s booth and painting permits meet these requirements.

A search of AQMD records show that A&A has permits for two paint booths. One is 43’ long by 14’ wide and 14’ tall. See AQMD Permit G249120 (Exhibit F). The other is 48’ long by

16.5’ wide and 12.25’ tall. See AQMD Permit G24919 (Exhibit G). Neither of these can accommodate the articulated buses that comprise a large fraction of Santa Monica’s fleet, and A&A simply cannot paint such buses in a fully enclosed booth in a manner compliant with Federal, State, and local laws and as required by the RFP.
5 4 While A&A’s website lists several transit agencies it claims to have worked on behalf of, it appears that most or all of these repairs were likely on behalf of MV Transportation, an operations service provider to several Southern California small-city transit agencies which in turn contracts out individual one-off repair projects. There is no record of A&A having ever been awarded any contract anywhere close to the scale of the one at issue here. See Exhibit E. 5 Further, at only 12.25’ high, the longer, 48’ booth is too short to enable painting of the roof of a bus. The buses in the Santa Monica fleet range from 9.7’ to 11.1’ high.

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In stark contrast, CGI can perform the work under this contract in compliance with all relevant federal and state laws and regulations including in connection with AQMD requirement and permits. A&A’ lack of a 60’ spray booth—as required by the RFP—should, on its face, have immediately disqualified A&A from consideration at all. The terms “must” and “shall” are clear.

3. A&A’s Facility is Sufficiently Far from Santa Monica to Be a Material Issue in Quality of Performance
Additionally, CGI should have been ranked higher than A&A because its facility is nearly 21 miles closer to the SMDOT’s facility in Santa Monic and therefore is far more able to “perform the contract or provide the service promptly, within the time specified, and without delay or interference.”
Specifically, CGI’s facility in Signal Hill is 30 miles from the Big Blue Bus Maintenance Facility (the “Bus Barn”). As demonstrated in years of performance of prior contracts with Santa Monica, the time to transport a bus between the facilities is typically 30 to 40 minutes. In contrast, A&A’s facility is 52 miles away and an expected 1.5 to 2.25 hours’ drive time. It is important to note that (again, as substantiated by decades of experience doing exactly this work for Santa Monica) many of the repairs to be done under this contract will be completed in two or three days.

Thus, an additional 3 to 4 hours of round-trip transportation time when a bus is out of revenuecollecting service, is a material difference in capability/performance.6

4. The Equal Ranking of A&A and CGI Experience was Arbitrary and Capricious
In short, the evaluation committee simply had to have ignored the facts and evidence in comparing CGI and A&A’s relative experience, and instead, acted in an arbitrary and capricious manner. These rankings are entirely lacking in evidentiary support and are procedurally unfair to CGI and must be overturned.
6 It is also worth noting that this disparity calls into question a part of A&A’s pricing proposal. A&A states that it will not charge Santa Monica anything for vehicle transport time. This is not realistic given the percentage of skilled man-hours of the entire contract that such transportation will absorb.

It is more realistic to believe that A&A will pad those hours into other tasks under the contract.

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C. Ranking A&A’s Cost Proposal Above CGI’s Did Not Take Into Account Factors that Will Affect the True Cost of the Work.

As mentioned above, CGI concedes that its price per unit is marginally higher than A&A’s, but this fact alone should not necessarily mean that A&A should have been ranked higher, let alone 11 points higher, garnering a perfect score. The evaluation committee seems to have failed to factor in how experience and proximity would affect the true cost to SMDOT of having a given vendor perform the work.

It is important to note that the RFP does not call for quoted prices to perform specific repairs or even a particular number of bus repairs overall. Rather it merely requests an hourly rate for a fixed number of hours, with no commitment of what will be accomplished in that time.

CGI’s hourly rates are higher because it has highly skilled employees who are vastly more experienced (generally, and for Santa Monica’s specific needs) than A&A’s staff, and, therefore, can be expected to be more efficient.

Moreover, the true cost of the work includes the time that SMDOT’s fleet buses are out of service. The fact that CGI can complete repairs more quickly and transport a vehicle round trip in one-quarter to one-third of the time it will take A&A to do so means that CGI can turn around the work and have the buses back in revenue-service substantially faster than A&A. (The likely scenario of that additional time for transportation by A&A also being hidden in other estimates and charges is a further issue.)
In light of these facts, the evaluation committee should not have given A&A a perfect cost score and they should have ranked CGI’s cost score higher.

RESERVATION OF RIGHTS
On November 20, 2025, Counsel for CGI submitted an open records request for documents and information related to the bid process and review. Because SMDOT has not yet produced the requested records related to this RFP, CGI respectfully reserves its right to supplement this protest after its receipt of the requested records.

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CONCLUSION
Because CGI was prejudiced by the evaluation committee’s arbitrary and capricious actions in evaluating both the experience of the bidders and the true costs of performance—and its rankings are entirely lacking in evidentiary support and procedurally unfair to CGI—the award decision must be overturned. CGI respectfully requests that (after appropriate investigation) SMDOT take voluntary corrective action and rescind the Notice of Intent to Award, and either: (1) disqualify A&A (due to its lack of experience and its inability to perform the necessary painting work in a manner required by the law and the RFP) and award the contract to CGI; or (2) re-evaluate the Proposals considering the effectiveness of the proposal as a whole, rather than simply by the bottomline cost, or (3) award two contracts, one to A&A and one to CGI.

CGI appreciates the opportunity it was given to submit a proposal in response to the RFP and looks forward to continuing its successful relationship with SMDOT.

DATED: November 25, 2025 TAMARA McNULTY
JOSHUA S. HODAS
GARRETT A. DEAN
MARIA K. SHOCKLEY

LEWIS BRISBOIS BISGAARD & SMITH LLP
By: /s/ Joshua Hodas
JOSHUA S. HODAS
Attorneys for Carlos Guzman, Inc.

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Packet Pg. 810 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Exhibit A
RFP Transit Bus Body and Paint Repairs

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Packet Pg. 811 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs)

CITY OF SANTA MONICA

TRANSIT BUS BODY AND PAINT REPAIRS

INVITATION TO BID
Project ID: 4506
SaMoDOT
RELEASE DATE: October 10, 2025
DEADLINE FOR QUESTIONS: October 16, 2025
RESPONSE DEADLINE: November 3, 2025, 3:00 pm
CITY CONTACT:

David Nanjo
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 1 of 42

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Packet Pg. 812 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
Invitation To Bid
Transit Bus Body and Paint Repairs
Table of Contents

1. Notice Inviting Bids

2. Introduction

3. Instructions to Bidders

4. Bid Specification/Scope of Work

5. General Terms

6. Terms and Conditions

7. Insurance Requirements

8. Non-Discrimination Policy

9. Oaks Initiative

10. Living Wage Ordinance

11. Bid Form

12. Certification Regarding Debarment

13. Vendor Submission

14. Pricing Proposal

15. Evaluation Phases
Attachments:

A - CSA Template
B - CSA Insurance Template
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 2 of 42

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Packet Pg. 813 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
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Request for Proposals
Transit Bus Body and Paint Repairs
1 Notice Inviting Bids

CITY OF SANTA MONICA ONLY ACCEPTS ELECTRONIC BID SUBMITTALS

1.1 NOTICE
Notice is hereby given that electronic proposals of Bid No.4506 shall be received to Transit Bus Body and Paint Repairs, per the attached terms, conditions and specifications. Bids will be electronically opened by the Procurement Office at 3:00 pm (Pacific Time) on Monday, November 3, 2025 viewable on the CITY’S ONLINE VENDOR PORTAL.

1.2 VENDOR QUERIES DUE
Questions must be submitted online in the “Q&A” tab. The City will only accept or respond to questions submitted through the online vendor portal. Questions regarding this bid are due Thursday, October 16, 2025 no later than 3:00 pm Pacific Time.

One question per submittal. (This does not mean one question per vendor.) Submittals containing multiple questions will not be answered.

1.3 ADDENDUM POSTED ONLINE
Responses to inquiries received will be posted online by Monday, October 27, 2025, 3:00 pm Pacific Time.

1.4 BID PACKAGE
Bid packages containing all forms, specifications, terms and conditions may be obtained on the CITY’S ONLINE VENDOR PORTAL. The website for this Notice Inviting Bids and related documents is: OpenGov.

All documents must be downloaded via the links within this bid document. Links or documents found outside the CITY'S ONLINE VENDOR PORTAL may not be accessible.

1.5 ELECTRONIC SUBMISSIONS
Submissions will only be accepted through the CITY'S ONLINE VENDOR PORTAL. They must be received by the specified date and bid opening time.

1.6 LIVING WAGE
Any contractual services agreement issued as a result of this Notice Inviting Bids may be subject to the City’s Living Wage Ordinance, Santa Monica Municipal Code Chapter 4.65 (LWO), and its implementing regulations. In the event the contractual services agreement issued as a result of this Notice Inviting Bids and is subject to the LWO, the Contractor shall pay its employees the Minimum Wage, as that term is defined by the City’s LWO.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 3 of 42

4.M.c
Packet Pg. 814 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

1.7 APPROVED FOR ADVERTISEMENT
Dated Friday, October 10, 2025.

Teresa Villa

PROCUREMENT MANAGER
Published: SMDP
BID#4506
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 4 of 42

4.M.c
Packet Pg. 815 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
2 Introduction

2.1 Summary
The Santa Monica Department of Transportation is seeking bids to provide body repair and painting services to its fleet of transit buses including 30', 40', and 60' buses.

2.2 Contact Information
Kellee Mac Donald
Sr. Buyer
1685 Main St. Mail Stop #9
Santa Monica, CA 90401
Email: [email protected]
Phone: (310) 458-8797
Department:

SaMoDOT
Department Head:

Anuj Gupta
Director SaMoDOT

2.3 Timeline
Release Project Date October 10, 2025
Question Submission Deadline October 16, 2025, 3:00pm
Question Response Deadline October 27, 2025, 3:00pm
Bid Submission Deadline November 3, 2025, 3:00pm
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 5 of 42

4.M.c
Packet Pg. 816 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
3 Instructions to Bidders

3.1 Bid Award
The City reserves the right to award the bid to separate bidders on any of the items as provided in and set forth in the bidder’s proposal form furnished by the City. It is further understood that if the bidder to whom any award is made fails to enter into a contract with the City, award may be made to the next best bidder, who shall be bound to perform as if she, he or it received the award in the first instance.

3.2 Best Bidder
The award, if any, will be made to the best bidder(s). In evaluating whether a bidder(s) is (are) the best bidder(s) pursuant to the Santa Monica Municipal Code, City may utilize some or all of the following criteria:
(1) Price.
(2) The quality of the material or services offered.
(3) The ability, capacity, and skill of the bidder(s) to perform the contract or provide the materials or services.
(4) The capacity of the bidder(s) to perform the contract or provide the service promptly, within the time specified, and without delay or interference.
(5) The sufficiency of the bidder’s financial resources. (6) The character, integrity, reputation, judgment, training, experience, and efficiency of the bidder.
(7) The ability of the bidder(s) to provide such future maintenance or service as may be needed. (8) Any other factor which will further the intent set forth in Section 608 of the City Charter.

The City of Santa Monica (the “City”) shall have absolute discretion in determining the applicability and weight or relative weight of some or all of the criteria listed above and is not required to select the lowest monetary bidder.

3.3 Bid Forms
Bids must be submitted on forms supplied by the City of Santa Monica and in accordance with the specifications, terms and conditions contained therein. Bid packages containing all forms, specifications, terms and conditions may be obtained on the CITY’S ONLINE VENDOR PORTAL.

The website for this Notice of Inviting Bids and related documents is OpenGov. . All project correspondence will be posted on the website. It is the responsibility of Bidders to check the website regularly for information updates and Bid clarifications, as well as any addenda. There is no charge for bid package and specifications.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 6 of 42

4.M.c
Packet Pg. 817 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
All documents must be downloaded via the OpenGov links.

3.4 Electronic Submissions
ELECTRONIC SUBMISSIONS will only be accepted through The CITY’S ONLINE VENDOR PORTAL. For instruction on how to submit an electronic bid please refer to the section titled #Vendor Submission.

3.5 Bid Results/Recommended Award
A tabulation of bids received and recommended award will be posted on the CITY’S ONLINE VENDOR PORTAL.

3.6 Bid Withdraw
Bids submitted may be withdrawn by written request received before the due date and time.

After that time, no bidder may withdraw a bid for a period of ninety (90) days from the date of opening. A successful bidder may not withdraw his, her or its bid at any time.

3.7 Informed Bidder
Before submitting bids, bidders shall fully inform themselves as to the conditions, requirements and specifications of the work or materials specified. Failure to do so will be at bidders’ own risk.

Bidders cannot secure relief on the plea of error or mistake.

3.8 Late Bids
It is the bidder’s responsibility to ensure that any bid submitted shall have sufficient time to be uploaded into the CITY’S ONLINE VENDOR PORTAL prior to bid opening time. They must be received by the specified date and bid opening time. Late bids will not be accepted.

3.9 No Bid
If unable to bid, please select the "No Bid" option button in the CITY’S ONLINE VENDOR PORTAL and provide a brief reason.

3.10 Number of Responses
Bidders may submit multiple bids, if desired. The City is not recommending or suggesting that bidders submit multiple bids. The City is merely stating an available option. If a bidder chooses to submit multiple bids, each must be entirely separate from the others. The City will not collate, merge, or otherwise manipulate the bidder’s bids.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 7 of 42

4.M.c
Packet Pg. 818 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

3.11 Oral Changes
Any material changes and addenda will be issued in writing. Do not rely upon oral explanations on the meaning of the specifications or interpretations of the terms.

3.12 REQUIRED BID DOCUMENTS (SERVICES)
Bidder shall complete and return the following documents in original page order and format:
• Addenda if issued
• Oaks Initiative Disclosure Form (if the award amount is >$25,000 annually; identifies recipients of public benefit in relation to political donation restrictions: click here for more information)
• Levine Act Disclosure Form
• Experience Statement
• List of Sub-Contractors
• Living Wage Certification (if the award amount is >$54,200) • Certificate of Compliance
• Certification Regarding Debarment
• Non-Discrimination Policy Acknowledgment
• Non-Collusion Declaration (this does not need to be notarized)

3.13 Successful Bidder Required Documents (Goods)
The following documents will only be required from successful bidder:
• Business License (if applicable)

3.14 Protest Deadline
All parties wishing to file a protest shall comply with the procedures set forth in Santa Monica Municipal Code section 2.24.260 found here. Bidder may file a written protest with the Purchasing Agent (mail or deliver to: 1685 Main Street, Santa Monica, CA 90401 ) no more than seven calendar days following the posting of award recommendation on the CITY’S ONLINE VENDOR PORTAL.

3.15 Receiving Time
The submit time and date will be the governing time for acceptance of bids. Bids will not be accepted by in person, telephone, email or facsimile machine. They must be received by the specified due date and time.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 8 of 42

4.M.c
Packet Pg. 819 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

3.16 Exceptions to Terms and Conditions
Bidders must submit any requested exceptions to the City of Santa Monica’s Terms and Conditions and/or Contractual Services Agreement with their bid. The City may, in its sole discretion, elect to allow for exceptions to the standard terms and conditions and/or Contractual Services Agreement before the award is recommended.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 9 of 42

4.M.c
Packet Pg. 820 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
4 Bid Specification/Scope of Work
Bidders shall review any plans/specifications prior to submitting a bid AND report any errors and omissions during the Q&A period.

4.1 Scope of Work

SCOPE OF WORK
A. Provide body and repair services for City of Santa Monica Department of Transportation (SMDOT) fleet of transit buses including, but not limited to, complete bus repainting, body repairs and interior painting and refinishing; fabrication of interior and exterior panels, stanchions and other related components and parts.

B. Provide bus pick-up and delivery service for all bus types. Pick-up and delivery shall be from SMDOT (1620 6th Street Santa Monica CA, 90401) to bidder location and from bidder back to SMDOT.

C. Digital pictures of before and after body repairs must be available for a minimum of three years. Provide a report including pictures of vehicle initial condition, midrepair, and finished repairs upon completion of work D. Provide an estimate prior to beginning work on any SMDOT vehicles, estimate must be approved by the Transit Vehicle Maintenance Superintendent or designee prior to beginning work.

E. All body and paint repairs shall be preauthorized by the SMDOT.

F. Buses that are in the process of repair shall be made available for inspection at any point during the repair process.

G. Proof of purchase documents, including packing slips and invoices shall be made available upon request from SMDOT Transit Maintenance Supervisor.

H. Subcontractors perform any part of bus body repair services. The contractor must submit written request for approval of subcontractors indicating the scope of work to be performed by the proposed subcontractor
o RUST AND BODY REPAIR SPECIFICATION

1. corrosion problems vary from bus to bus and in many cases are hidden from view. Contractor must make all reasonable efforts to find and advise the SMDOT staff of all corrosion found, proof of corrosion shall be provided to SMDOT prior to making the necessary repairs.

2. Contractor’s technicians must have training in proper corrosion control practices and procedures.

3. Contractor is expected to repair rusted and damaged areas on buses assigned to them in a timely fashion.
o DESCRIPTION OF WORK EXPECTED
A. All areas with rust corrosion shall be stripped of paint, rust-proofed, filled in or sectioned with new material, sanded, primed, and bus repainted to Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 10 of 42

4.M.c
Packet Pg. 821 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
Santa Monica's bus colors. Roofs and anodized aluminum areas excluded.

B. Repair of accident and other body damage when requested by the Transit Vehicle Maintenance Superintendent or his designee.

C. All repairs and painting shall conform to OEM specifications, including product specifications and bus builder specifications.

D. Santa Monica may provide some bus body parts. However, the contractor may have to supply body panels and parts, decals and/or fabricate parts that are no longer available from bus manufactures. All miscellaneous supplies such as fasteners, paint, masking tape, and other commonly stocked items will be supplied by bidder.

E. All rusted areas shall be treated with a chemical treatment that bonds with the remaining traces of rust to stop further rusting from happening.

F. Body panels shall be installed in a uniform manner using OEM approved materials and methods.

G. Fit and finish shall meet or exceed OEM specification.

H. The use of double stick tape shall only be used in areas that are approved by the OEM.

I. All decals, interior and exterior shall be installed prior to delivery of the bus. Buses with decals out of place and/or missing will not be accepted and must be corrected by the contractor.

J. Buses shall be picked up and delivered back to Santa Monica Big Blue Bus located at 1620 6th Street, Santa Monica. Contractor will be required to show that they have staff with a current commercial driver’s license and the necessary licensing and insurance coverage to transport 30’, 40’ and 60’ transit buses as required by Federal, State and local Laws, Rules and Regulations.

K. Contractor must dispose of all hazardous waste in accordance to Local, State and Federal rules, laws and regulations governing the disposal of hazardous waste.
o BODY PAINTING
A. Body panels that have been painted shall not have drips, fisheye marks, or dirt or other debris within painted surfaces.

B. All paint repairs must meet or exceed OEM paint specifications C. Contractor must comply with all application procedures as specified by the materials manufacturer
D. Contractor must provide a list of paint products that will be used in vehicle painting repairs
E. The entire painted surface shall be color sanded and buffed.

F. All bus paint applications including primer, base coat and clear coats shall be performed per paint manufacturer recommendations and applied in a fully enclosed paint booth.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 11 of 42

4.M.c
Packet Pg. 822 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
G. The use of body filler or other like products shall be kept to a minimum.

Contractor shall notify SMDOT Transit Vehicle Maintenance Superintendent when this product is needed and where it is needed. o COLOR CODES
A. OEM Paint codes include Axalta BS537EW and BS540EW
B. Color match all other painting surfaces as needed.

4.2 Vendor Requirements

VENDOR REQUIREMENTS/MINIMUM QUALIFICATIONS
• Bidder must have a fully enclosed paint booth in their facility; all painting shall be performed in a paint booth. Bidder must have the ability to accommodate painting of 60’ buses in compliance with applicable Federal, State and local laws, rules and regulations.
• All work shall be performed at bidder location.
• Bidder must have a minimum of five (5) years of full-time experience repairing and painting transit coach body damage caused by collision, rust, aging, and/or any interior and exterior damage. Bidder must have experience performing body repairs and painting on transit buses.
• Bidder technicians must have successfully completed the hands-on training and evaluation to meet the requirements of EPA rule 40 CFR part 63 Subpart HHHHHH National Emission Standards for Hazardous Air Pollutants. • Bidder painters shall be qualified to keep record of accurate coating usage records. • Bidders must provide, as part of your bid, an experience statement including a list of clients and the size of the bidders contracts with those clients. • Bidder must maintain a current copy of their delivery personnel’s (anyone who might be driving SMDOT coaches, as well as any drive-away companies) “Class B” Driver’s License.
• Successful bidders’ repair facilities must be licensed by all Federal, State, and Local (City) governments and must have these licenses posted in their offices. Provide a copy of license as part of this bid. • Bidder must allow SMDOT personnel to visit and approve its repair facility prior to award of bid.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 12 of 42

4.M.c
Packet Pg. 823 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
5 General Terms

5.1 AUTHORIZED DISTRIBUTOR
Any successful bidder must be an Authorized Distributor for the offered product/equipment or must submit documentation from an Authorized Distributor that the offered product/equipment was from that Authorized Distributor who will then honor all of the manufacturer’s warranties.

5.2 BRAND NAMES/DEVIATIONS/LATEST MODEL
Bidder must state brand name and/or manufacturer of each item proposed in this bid. All guarantees and/or warranties must also be stated. Parts and materials must be latest model or current date and meet specifications. This provision excludes surplus, remanufactured and used products, unless such material proposed is in lieu of items called for. The City reserves the right to approve equal equipment or material. Bids will be considered on equipment or material complying substantially with specifications provided each deviation is stated and substitution is described, including technical data when applicable, in a letter attached to bid.

Any manufacturer’s names, trade names, brand names, model or catalog numbers used in these specifications are for the purpose of describing and establishing general quality levels.

Such references are not intended to be restrictive. Bids will be considered for any brand which meets or exceeds the quality of the specifications listed for any item; such bids shall state brand name and number and include detailed specifications.

5.3 COMPLIANCE OR DEVIATION TO SPECIFICATIONS
It is understood that the material, equipment or service offered by the bidder will meet all requirements of the specifications in this Notice Inviting Bids, unless deviations therefrom are clearly indicated in the pages of this Notice Inviting Bids, or in an attachment entitled “Exceptions to Specifications”submitted and signed by bidder or bidder’s authorized representative. In order for the bid to be considered, bidder shall include an explanation for each item to which an exception is taken, giving in detail the extent of the exception and the reason for such exception. Although submittal of a brochure or other manufacturer literature is desirable as additional information, submittal of a brochure or other manufacturer literature as substitution for the compliance/deviation information described above shall not be deemed to be in compliance with this requirement, and may be grounds for rejection of a bid. Bidder shall submit with his, her or its bid full descriptive data, including make and model specifications, general drawings (if applicable), brochures and any other information on the material specified herein.

5.4 DETERMINATION OF SUBSTITUTIONS
The City reserves the right to determine as to whether any substitutions or deviations are within the intent of the bid specifications and will reasonably meet the service requirements of the City.

Furnishing catalog sheets with technical data will not be accepted as proper notice of a substitution or a deviation from the specifications.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 13 of 42

4.M.c
Packet Pg. 824 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
If the specification allows for “approved equal”, bidder must provide all information with their bid in order for the City to determine if the product offered is an equal to the brand specified and/or meets the technical specifications. The City reserves the right to determine whether the substitution is equal to the brand specified or the stated technical specifications. The decision of the City regarding equality shall be final.

5.5 DELIVERY TIME
Delivery time will be a factor in award of bid, where a maximum time for delivery is stipulated herein. Delivery time must be shown on the Bid Proposal.

5.6 ESCALATION & DE-ESCALATION OF BID PRICE
During the life of a contract awarded pursuant to this Notice Inviting Bids, including any extensions thereof, there may be a general published manufacturer’s price change OR a general market change, as evidenced by prices paid by other governmental entities or private organizations, in either the cost of materials or labor of the product or service specified herein.

Within thirty (30) calendar days of a DECREASE in price, a successful bidder shall have an AFFIRMATIVE DUTY to (1) notify the City of market, manufacturer or laborer decreases in prices; and (2) to extend the full decrease to the City. Failure of a successful bidder to notify the City and/or extend such decrease(s) may be considered a breach of contract.

In event of an INCREASE in price, the City may allow, upon presentation of suitable proof and thirty (30) calendar days’ advanced written notice, an increase over bid price. Increases will apply only to products or services affected by an increase in raw material, labor, or other like cost factors. No increase will be allowed earlier than sixty (60) calendar days from date of contract award, including thirty (30) calendar days’ advanced written notice.

5.7 MANUFACTURER’S WARRANTY
Bids shall be accompanied by a copy or description of the manufacturer’s warranty for the item(s) proposed. The description shall include the length and scope of the warranty, and will be evaluated as a factor in award of bid.

5.8 MEASUREMENTS
It is the responsibility of the bidder to make all measurements to determine contractor’s bid price. The City will not be responsible for determining the quantities of materials necessary to complete the work specified in this Notice Inviting Bids.

5.9 NEW AND UNUSED
Unless specifically provided to the contrary, all items and material specified are new and unused and have the current production year. Bids which are received for other than the current production year, or for items and materials which have been previously used, will be rejected.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 14 of 42

4.M.c
Packet Pg. 825 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

5.10 REJECTION OF WORK
Bidder agrees that the City has the right to make all final determinations as to whether the work contemplated under this Notice Inviting Bids has been satisfactorily completed.

5.11 SANTA MONICA NAME
Successful bidder is specifically denied the right of using in any form or medium the name of the City of Santa Monica for public advertising unless express permission is granted by the City.

5.12 VENDOR WARRANTY
Any successful bidder shall fully warrant all materials, equipment, including, without limitation, any optional equipment purchased by the City under the terms of this Notice Inviting Bids, against poor and inferior quality equipment and materials, for a period of not less than one (1) year from date of the final acceptance by the City. While under warranty, any successful bidder shall repair or replace inoperable equipment or material in a timely manner so as to minimize the possible disruption of City operations resulting from said inoperable equipment or material.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 15 of 42

4.M.c
Packet Pg. 826 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
6 Terms and Conditions

6.1 Adherence to All Local, State, and Federal Laws
Contractor must comply with all laws of the State of California and the United States, and all ordinances, rules and regulations enacted or issued by City.

6.2 Cancellation and Termination
The City reserves the right to cancel any portion of this Purchase at any time prior to the delivery of Goods. The City has the option, at its sole discretion and without cause, of terminating this Purchase by giving ten days’ written notice to Vendor.

6.3 Changes
The City has the right, by written notice, to change the quantity or specifications of the Goods ordered and the terms of, shipment or packaging of Goods.

6.4 Delivery & Completion Date
The Goods must be shipped and must arrive at the destination specified on the Purchase Order as “Ship/Bill To” by or before the request date specified therein (“Required Delivery Date”).

Work must be completed by the date specified.

6.5 Delivery Risk of Loss
All orders will be F.O.B. destination if not otherwise specified. Risk of loss or damage to the Goods shall remain with the Vendor until the Goods have been delivered to and accepted by the City. The City may reject any Goods that do not conform to the terms and conditions of the Bid Documents. Any Goods rejected may be returned to the Vendor at the Vendor’s risk and expense.

6.6 Discounts
The date used as the basis for discount calculation shall be computed from the date of receipt of invoice or Goods, whichever is later.

6.7 Discrimination
The Vendor may not discriminate in the provision of services hereunder because of race, color, religion, national origin, ancestry, sex, age, sexual orientation, marital status, AIDS or disability and must comply fully with City’s nondiscrimination policy as set forth in the City’s Bid Documents.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 16 of 42

4.M.c
Packet Pg. 827 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

6.8 Governing Law, Jurisdiciton
This Purchase shall be construed in accordance with and governed by the laws of the State of California. The purchase of Goods shall take place in Santa Monica, California.

6.9 Integration; Amendment
This Purchase represents the entire understanding of the City and the Vendor as to those matters contained herein. No prior oral or written understanding will be of any force or effect with respect to the terms of this Order. The Order may not be modified except in writing through an amended Order.

6.10 Invoices
An invoice must be mailed to the City at the address specified in the Request for Quotation as “Ship/Bill To” no later than the 5th day after shipment is made. Individual invoices must be issued for each shipment against each Purchase.

Invoices must contain the description of Goods, unit price, quantities billed, extended totals, and applicable taxes.

6.11 Nontransferability
The Vendor may not transfer or assign the PURCHASE ORDER, without the prior written approval of the Purchasing Agent, which may be withheld in his/her sole discretion.

6.12 Packing and Shipping
All deliveries must be shipped F.O.B. destination. Deliveries must be made as specified, without charge, for boxing, crating or storage unless otherwise specified. Shipments for two or more destinations when so directed by the City will be shipped in separate boxes or containers for each destination, at no charge.

6.13 Waiver
A waiver of any breach of this Purchase may not be deemed a waiver of any subsequent breach of the same or any other term, covenant, or condition of this Purchase.

6.14 Warranty
The Vendor warrants that all Goods will conform to applicable specifications, drawings, description, and samples, and will be merchantable, of good workmanship in material, and free from defect. Unless manufactured pursuant to detailed design furnished by the City, the Vendor assumes design responsibility and warrants the Goods to be free from design defect and suitable for the purposes intended by the City, and that such Goods shall conform to applicable specifications. The Vendor’s warranties, together with its service guarantees, must run to the City and its customers or users of the Goods and must not be deemed exclusive. The City’s Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 17 of 42

4.M.c
Packet Pg. 828 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
inspection, approval, acceptance, use of, and payment for all or any part of the Goods must in no way affect its warranty rights whether or not a breach of warranty had become evident in time.

6.15 Cooperation Between Contractors
When separate contracts are let within the limits of any one project, each contractor shall conduct his, her or its work so as not to interfere with or hinder the progress or completion of the work being performed by other contractors. Contractors working on the same project shall cooperate with each other. Each contractor involved shall assume all liability, financial or otherwise, in connection with his, her or its contract and shall protect and save harmless the City from any and all damages or claims that may arise because of inconvenience, delays, or loss experienced by him or her.

6.16 Damage
Contractor shall be held responsible for any breakage, loss of City’s equipment or supplies through negligence of the contractor or his, her or its employee while working on the City’s premises. Contractor shall be responsible for restoring/replacing any equipment, facilities, etc. so damaged. Contractor shall immediately report to the City any damages to the premises resulting from services performed under a contract awarded pursuant to this Notice Inviting Bids.

6.17 Force Majeure (Acts of God)
In the event performance under a contract is be delayed or suspended, and if such failure arises out of causes beyond the control of and without fault or negligence of the successful bidder, the successful bidder shall notify the City, in writing, within twenty-four (24) hours, after the commencement of the delay. Such causes may include, but are not limited to, Acts of God, war, or acts of public enemy, acts of any governmental entity in its sovereign or contractual capacity, fires, floods, epidemics, strikes and unusually severe weather.

6.18 Independent Parties
City and the Vendor will be acting in an independent capacity and not as agents, employees, partners, or joint ventures of one another. Neither the City nor its officers or employees will have any control over the conduct of Vendor or any of Vendor’s agents, employees, nor subcontractors.

6.19 Indemnity
Vendor agrees to defend, indemnify, protect, and hold harmless the City, its agents, officers, boards and commissions, and employees (collectively, “City”) from and against any and all liability, claims, demands, damages, or costs, including but not limited to attorney’s fees, or payments for injury to any person or property (collectively, “Losses”) caused or claimed to be caused by the act, errors, and/or omissions of Vendor, or Vendor’s employees, agents, officers, Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 18 of 42

4.M.c
Packet Pg. 829 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
and subcontractors. Vendor’s responsibilities under this section include liability arising from, connected with, caused by, or claimed to be caused by the active or passive negligent acts or omissions of the City, which may be in combination with the acts or omissions of Vendor, its employees, agents or officers, or subcontractors; provided, however, that Vendor’s duty to defend, indemnify, protect and hold harmless shall not include any Losses arising from the sole negligence or willful misconduct of the City. Notwithstanding Vendor’s obligation to defend City hereunder, City has the right to conduct its own defense and seek reimbursement for reasonable costs of defense from Vendor, if City chooses to do so. Vendor agrees to pay any and all costs the City incurs enforcing the indemnity, defense, and hold harmless provisions set forth this section.

6.20 Licenses, Permits and Certificates
The Vendor, at its sole expense, must obtain, and maintain all required business and professional permits, licenses and certificates.

6.21 Nuisance
The Vendor may not maintain, commit, or permit the maintenance or commission of any nuisance in connection with the performance of Services under the PURCHASE ORDER.

6.22 Protection of Public
Adequate warning devices, barricades, guards, flagmen or other necessary precautions shall be taken by contractor to give advised and reasonable protection, safety and warning to persons and vehicular traffic concerned in the area.

6.23 Purchase of Services
The City agrees to purchase from Vendor, and Vendor agrees to provide the services set forth in; (i) the City’s written solicitation of bids (“City’s Bid Documents”); and (ii) Vendor’s Bid in response thereto (“Vendor’s Bid”) (“Services”). The Services shall be provided in a manner consistent with that level of care and skill ordinarily exercised by members in the same profession, practicing in the same locality under similar conditions. In the event of any conflict, the order of precedence shall be as follows: (i) the City’s Bid Documents; and (ii) Vendor’s Bid.

There shall be no substitution

6.24 Safety
Items covered by a contractual services agreement issued in connection with this Notice Inviting Bids must conform to the Safety Orders of the State of California, Division of Industrial Safety.

6.25 Subcontractors
If the Vendor proposes to have any subcontractor perform any part of the Services other than those disclosed in Vendor’s Bid Documents, Vendor must submit a request to the Purchasing Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 19 of 42

4.M.c
Packet Pg. 830 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
Agent for approval in writing. The City, in its sole discretion, may grant or deny the request. The Vendor will be responsible for the quality of any subcontractor’s work. Every subcontract of any kind entered into between the Vendor and any subcontractor (or between any subcontractor and others) shall be consistent with the terms and conditions.

6.26 Taxes
The Vendor must separately state on all invoices any taxes imposed by the local, state or federal state government applicable to furnishing of Goods and Services; provided, however, where a tax exemption is available, the tax must be subtracted from the total price and identified.

6.27 Termination
The City reserves the right to cancel any portion of this Purchase Order at any time prior to the delivery of Services. The City has the option, at its sole discretion and without cause, of terminating this Purchase Order by giving ten days’ written notice to Vendor. If Vendor fails or refuses to perform any of the provisions of this Purchase Order, and if the default is not cured within a period of five days after the City’s written notice of default specifying the nature of the default, City may immediately terminate Purchase Order by written notice to Vendor. Upon termination of this Purchase Order, City will pay Vendor any compensations earned and unpaid up to the effective date of termination.

6.28 Work Product, Reports
Any work product prepared or caused to be prepared by the Vendor or any subcontractor will be the exclusive property of the City. No work product given to or prepared by the Vendor or any subcontractor may be made available to any individual or organization by the Vendor without prior written approval by the City.

6.29 Venue and Jurisdiction
The City and Vendor agree that the Services will take place in Los Angeles County. Any litigation arising out of this Purchase Order may only be brought in either the United States District Court, Central District of California, or the Superior Court of California, County of Los Angeles, West District, as appropriate. The parties agree that venue exists in either court, and each party expressly waives any right to transfer to another venue. The parties further agree that either court will have personal jurisdiction over the parties to this Purchase Order.

6.30 Unknown Obstructions
Should any unknown obstruction be encountered during the course of any contract, such obstruction(s) shall be immediately brought to the attention of the City. Contractor shall be responsible for the protection of all existing equipment, facilities, furniture or utilities encountered within the work area.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 20 of 42

4.M.c
Packet Pg. 831 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

6.31 Waiver
A waiver of any breach of this Purchase may not be deemed a waiver of any subsequent breach of the same or any other term, covenant, or condition of this Purchase Order.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 21 of 42

4.M.c
Packet Pg. 832 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
7 Insurance Requirements
The insurance documentation is only required from the successful bidder

7.1 Insurance Requirements for Vendors
Vendor shall procure and maintain for the duration of the Agreement insurance against claims for injuries to persons or damages to property that may arise from or in connection with the performance of the work hereunder by the Vendor, its agents, representatives, employees or subcontractors.

7.2 Minimum Scope and Limits of Insurance
Coverage shall be at least as broad as:

A. Commercial General Liability (CGL): Insurance Services Office Form CG 00 01 covering CGL on an “occurrence” basis, including products and completed operations, property damage, bodily injury and personal and advertising injury, with limits of no less than $1,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location (Insurance Services Office Form CG 25 04) or the general aggregate limit shall be twice the required occurrence limit.

B. Automobile Liability: Insurance Services Office Form CA 00 01 covering Code 1 (any auto), or if Vendor has no owned autos, Code 8 (hired) and Code 9 (non-owned), with limits of no less than $1,000,000 per accident for bodily injury and property damage.

C. Workers’ Compensation: Workers’ Compensation insurance as required by the State of California, with Statutory Limits and Employers’ Liability Insurance with limits of no less than $1,000,000 per accident for bodily injury or disease (see footnote #1).

If the Vendor maintains broader coverage or higher limits than the minimums shown above, the City of Santa Monica requires and shall be entitled to the broader coverage or higher limits maintained by the Vendor. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City of Santa Monica.

7.3 Other Insurance Provisions
The insurance policies are to contain, or be endorsed to contain, the following provisions:

A. Additional Insured Status: The City of Santa Monica, its officers, officials, employees and volunteers are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of Vendor including materials, parts, or equipment furnished in connection with such work or operations.

CGL coverage can be provided in the form of an endorsement to the Vendor’s insurance (at least as broad as Insurance Services Office Form CG 20 10 11 85, or if not available, through the addition of both CG 20 10, CG 20 26, CG 20 33, or CG 20 38 and CG 20 37).

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 22 of 42

4.M.c
Packet Pg. 833 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
B. Primary Coverage: For any claims related to this Agreement, the Vendor’s insurance shall be primary coverage at least as broad as Insurance Services Office Form CG 20 01 04 13 as respects the City of Santa Monica, its officers, officials, employees and volunteers. Any insurance or self-insurance maintained by the City of Santa Monica, its officers, officials, employees or volunteers shall be in excess of the Vendor’s insurance and shall not contribute with it.

C. Notice of Cancellation: Each insurance policy required herein shall state that coverage shall not be cancelled except after notice has been given to the City of Santa Monica.

D. Waiver of Subrogation: Vendor hereby grants to the City of Santa Monica a waiver of any right of subrogation which any insurer of said Vendor may acquire against the City of Santa Monica by virtue of payment of any loss. Vendor agrees to obtain any endorsement that may be necessary to affect this waiver of subrogation, but this provision applies regardless of whether or not the City of Santa Monica has received a waiver of subrogation endorsement from the insurer. The Workers’ Compensation policy shall be endorsed with a waiver of subrogation in favor of the City of Santa Monica for all work performed by the Contractor, its employees, agents and subcontractors.

7.4 Self-Insured Retentions
Self-insured retentions must be declared to and approved by the City of Santa Monica. The City of Santa Monica may require the Vendor to purchase coverage with a lower retention or provide satisfactory proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention. The policy language shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the name insured or the City of Santa Monica.

7.5 Acceptability of Insurers
Insurance is to be placed with insurers authorized to conduct business in California with a current A.M. Best rating of no less than A:VII, unless otherwise acceptable to the City of Santa Monica.

7.6 Verification of Coverage
Vendor shall furnish the City of Santa Monica with original certificates and amendatory endorsements (or copies of the applicable policy language effecting coverage provided by this clause). All certificates and endorsements are to be received and approved by the City of Santa Monica before work commences. However, failure to obtain required documents prior to the work beginning shall not waive the Vendor’s obligation to provide them. The City of Santa Monica reserves the right to require complete, certified copies of all required insurance policies, including the endorsements required herein, at any time.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 23 of 42

4.M.c
Packet Pg. 834 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

7.7 Failure to Maintain Insurance Coverage
If Vendor, for any reason, fails to maintain insurance coverage which is required pursuant to this Agreement, the same shall be deemed a material breach of contract. The City of Santa Monica, at its sole option, may terminate this Agreement and obtain damages from the Vendor resulting from said breach.

7.8 Subcontractors
Vendor shall require and verify that all subcontractors maintain insurance meeting all the requirements stated herein. All exceptions must be approved in writing by the Risk Manager.

7.9 Footnotes
# 1:Workers’ Compensation insurance coverage is not required if the Vendor does not have employees. The Vendor must, however, execute the City’s Workers’ Compensation Coverage Exemption Declaration Form.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 24 of 42

4.M.c
Packet Pg. 835 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
8 Non-Discrimination Policy

8.1 City of Santa Monica Non-Discrimination Policy
Acknowledgment
A. Discrimination.

Discrimination in the provision of services may include, but not be limited to the following:
(a) Denying any person any service, or benefit or the availability of a facility. (b) Providing any service, or benefit to any person which is not equivalent, or in a nonequivalent manner or at a non-equivalent time, from that provided to others. (c) Subjecting any persons to segregation or separate treatment in any manner related to the receipt of any service.
(d) Restricting any person in any way in the enjoyment of any advantage or privilege enjoyed by others receiving any service or benefit.
(e) Treating any person differently from others in determining admission, enrollment, quota, eligibility, membership, or any other requirement or condition which persons must meet in order to be provided any service or benefit.
(1) Contractor shall take affirmative action to ensure that intended beneficiaries of this Agreement are provided services without regard to race, color, religion, national origin, ancestry, sex, age, gender, gender identification, gender expression, sexual orientation, marital status, AIDS or disability.
(2) Contractor shall further establish and maintain written procedures under which any person applying for or receiving services hereunder, may seek resolution from Contractor of a complaint with respect to any alleged discrimination in the provision of services by Contractor's personnel.

At any time any person applies for services under this Agreement, he or she shall be advised by Contractor of these procedures. A copy of these procedures shall be posted by Contractor in a conspicuous place, available and open to the public, in each of Contractor's facilities where services are provided hereunder.

B. Non-discrimination in Employment
(1) Contractor certifies and agrees that it will not discriminate against any employee or applicant for employment because of race, color, religion, national origin, ancestry, sex, age, sexual orientation, gender, gender identification, gender expression, marital status, AIDS or disability in accordance with the requirements of City, State or Federal law. Contractor shall take affirmative action to ensure that qualified applicants are employed, and that employees are treated during employment, without regard to race, color, religion, national origin, ancestry, sex, age, sexual orientation, gender, gender identification, gender expression, marital status, AIDS or disability, in accordance with the requirements of City, State and Federal law. Such shall include, but not be limited to, the following:

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 25 of 42

4.M.c
Packet Pg. 836 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
(a) Employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation. (b) Selection for training, including apprenticeship.
(2) Contractor agrees to post in conspicuous places in each of Contractor's facilities providing services hereunder, available and open to employees and applicants for employment, notices setting forth the provisions of this non-discrimination policy. (3) Contractor shall, in all solicitations or advertisements for employees placed by or on behalf of Contractor, state that all qualified applicants will receive consideration for employment without regard to race, color, religion, national origin, ancestry, sex, age, sexual orientation, gender, gender identification, gender expression, marital status, AIDS or disability, in accordance with the requirements of City, State or Federal law.
(4) Contractor shall send to each labor union or representative coworkers with which it has a collective bargaining agreement or other contract or understanding a notice advising the labor union or workers' representative of Contractor's commitments under this non-discrimination policy.
(5) Contractor certifies and agrees that it will deal with its sub-Contractors, bidders, or vendors without regard to race, color, religion, national origin, ancestry, sex, age, sexual orientation, gender, gender identification, gender expression, marital status, AIDS or disability, in accordance with the requirements of City, State and Federal law. (6) In accordance with applicable State and Federal law, Contractor shall allow duly authorized representatives of the County, State, and Federal government access to its employment records during regular business hours in order to verify compliance with this non-discrimination policy.

Contractor shall provide other information and records as the representatives may require in order to verify compliance with this non-discrimination policy. (7) If City finds that any of the provisions of this non-discrimination policy have been violated, the same shall constitute a material breach of agreement upon which City may determine to cancel, terminate, or suspend this Agreement. While City reserves the right to determine independently that this nondiscrimination policy has been violated, in addition, a determination by the California Fair Employment and Housing Commission or the Federal Equal Employment Opportunity Commission that Contractor has violated State or Federal non-discrimination laws shall constitute a finding by City that Contractor has violated the provisions of this nondiscrimination policy. (8) The parties agree that in the event Contractor violates any of the non-discrimination policies set forth herein, City shall be entitled, at its option, to the sum of five hundred dollars ($500) pursuant to Civil Code Section 1671 as liquidated damages in lieu of canceling, terminating or suspending this Agreement.
(9) Contractor hereby agrees that it will comply with Section 504 of the Rehabilitation Act of 1973, as amended (29 U.S.C. 794), all requirements imposed by applicable Federal Regulations, and all guidelines and interpretations issued pursuant thereto, to the end that no qualified disabled person shall, on the basis of disability, be excluded from participation in, be denied the benefits of, or otherwise be subjected to discrimination under any program or activity of the Contractor receiving Federal Financial Assistance.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 26 of 42

4.M.c
Packet Pg. 837 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
9 Oaks Initiative

NOTICE TO APPLICANTS, BIDDERS, PROPOSERS AND OTHERS SEEKING

DISCRETIONARY PERMITS, CONTRACTS, OR OTHER BENEFITS FROM THE CITY OF

SANTA MONICA
Santa Monica’s voters adopted a City Charter amendment commonly known as the Oaks Initiative. The Oaks Initiative requires the City to provide this notice and information about the Initiative’s requirements. You may obtain a full copy of the Initiative’s text from the City Clerk.

This information is required by City Charter Article XXII—Taxpayer Protection. It prohibits a public official from receiving, and a person or entity from conferring, specified personal benefits or campaign advantages from a person or entity after the official votes, or otherwise takes official action, to award a “public benefit” to that person or entity. The prohibition applies within and outside of the geographical boundaries of Santa Monica.

All persons or entities applying or receiving public benefits from the City of Santa Monica shall provide the names of trustees, directors, partners, and officers, and names of persons with more than a 10% equity, participation or revenue interest. An exception exists for persons serving in those capacities as volunteers, without compensation, for organizations exempt from income taxes under Section 501(c)(3), (4), or (6), of the Internal Revenue Code. However, this exception does not apply if the organization is a political committee or controls political committees. Examples of a “public benefit” include public contracts to provide goods or services worth more than $25,000 or a land use approval worth more than $25,000 over a 12-month period.

In order to facilitate compliance with the requirements of the Oaks Initiative, the City compiles and maintains certain information. That information includes the name of any person or persons who is seeking a “public benefit.” If the “public benefit” is sought by an entity, rather than an individual person, the information includes the name of every person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent interest in the entity.

Therefore, if you are seeking a “public benefit” covered by the Oaks Initiative, you must supply that information on the Oaks Initiative Disclosure Form. This information must be updated and supplied every 12 months.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 27 of 42

4.M.c
Packet Pg. 838 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
10 Living Wage Ordinance

CITY OF SANTA MONICA LIVING WAGE ORDINANCE
Certification for Providers of Services to the City of Santa Monica (Fiscal Year 25/26 – July 1, 2025 through June 30, 2026)

TO BE COMPLETED ON THE VENDOR SUBMISSION SECTION BY ALL CONTRACTORS PROVIDING SERVICES TO THE CITY OF SANTA MONICA IN EXCESS OF $54,200.

The City of Santa Monica Municipal Code Chapter 4.65, Living Wage Ordinance (LWO), establishes a Minimum Wage of $21.01 per hour for certain employees of contractors providing services to the City where services exceed $54,200 or more and requires that contractors also provide the same health care and other benefits to employees’ same sex spouses and domestic partners as are provided to other employees’ spouses.

An employee covered by the LWO is any person who does not actually work as a manager, supervisor, or confidential employee, and who is not required to possess an occupational license.

The Living Wage Ordinance applies the services sought pursuant to this bid and bidders are required to prepare and return the Living Wage Certification Form. If the bidder is selected, the bidder must maintain payroll records that include, at minimum, the full name of each employee providing services under the contract, job classification and rate of pay. Bids that fail to include Certification Forms may be considered non-responsive and excluded from further consideration.

Please complete the Living Wage Ordinance Certification Section found in the Vendor Submission section if you are a contractor engaging in a contract for services with the City of Santa Monica in excess of $54,200.

Your confirmation of this certification grants the City permission to review any and all payroll books and records and any company documents pertaining to the benefits offered to employees to assure your compliance with the LWO during the term of the contract.

Please direct any questions and send the completed, signed Certification to:

City of Santa Monica Finance Department
Attention: Living Wage Compliance Section
1685 Main Street, Mail Stop #9
Santa Monica, CA 90401
You can also contact staff regarding living wage ordinance questions by e-mail at [email protected] or by phone 310-458-8281.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 28 of 42

4.M.c
Packet Pg. 839 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
11 Bid Form

11.1 GENERAL INFORMATION

BUSINESS LICENSE NUMBER
If the successful bidder is required to possess a City of Santa Monica Business License, the successful bidder must obtain the business license prior to performing any work or services, and the City may delay payment of any sums due until such license has been obtained.

CALIFORNIA SALES TAX
The City will pay all applicable taxes.

FEDERAL EXCISE TAX
The City is exempt from Federal Excise Tax and an exemption certificate if necessary will be furnished to the successful bidder(s).

11.2 BID AWARD
The City reserves the right to increase or decrease the quantity of any item or omit items as may be deemed necessary or to delete any items of work in the award of contract, and the same shall in no way affect or make void the contract, except that appropriate additions or deductions from the contract total price will be made at the stipulated unit price.

11.3 PAYMENT TERMS
Goods or services are paid within thirty (30) days of delivery and receipt of an appropriate invoice.

11.4 PRICING
Pricing must be submitted through the Online Vendor Portal. The City will not accept pricing submitted by any other means.

11.5 GENERAL CONDITIONS

BID ACCEPTANCE PERIOD
Unless otherwise specified in this Notice Inviting Bids, prices are firm for a period of one hundred eighty (180) days from the bid opening date.

BIDDER AGREEMENT
By submitting a signed bid, bidder shall have acknowledged and agreed to all the terms and conditions set forth in all documents which make up this Notice Inviting Bids.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 29 of 42

4.M.c
Packet Pg. 840 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

BID AWARD CRITERIA
Bids are awarded based on the best bidder and may be contingent upon City Council approval.

Bids are evaluated based on pricing, availability, experience, and references.

CORRECTION OF ERRORS OR DISCREPANCIES
The following rules shall apply to the correction of errors or discrepancies in bids:

In the event a discrepancy in a bid is discovered prior to the award of the contract, the following rules shall apply to the correction of the discrepancy:

A. In the case of a discrepancy between a unit price and an extended price, the unit price shall prevail and the extended price shall be corrected accordingly.

B. If the total bid price does not equal the sum of the extended prices, the extended prices shall prevail and the total bid price shall be adjusted accordingly.

C. Discrepancies between the unit price and the extended price shall be corrected prior to corrections or adjustments between the extended prices and the total bid price.

D. If the extended prices or the total bid price are adjusted according to these rules, the adjusted total bid price shall prevail over the written or numeric total bid price stated in the bid.

E. In the case of a discrepancy between the numerical bid price and the written bid price, the price that conforms to an accurate sum of the extended prices shall prevail.

F. If the total bid price of any bid is adjusted, the adjusted total bid price shall be used to determine the lowest bid.

If no discrepancies are discovered prior to the award of the contract, the contract shall be awarded on the basis of the total bid stated in writing.

11.6 F.O.B. POINT & SHIPPING CHARGES
All prices shall be quoted F.O.B. destination, Santa Monica, California and all shipping; handling and freight charges shall be shown separately on the Bid Proposal.

11.7 CONTRACTUAL SERVICES AGREEMENT (CSA)
The successful bidder will be required to enter into a Contractual Services Agreement with the City (“CSA”) prior to any work commencing. All terms and conditions of this Notice Inviting Bids and the successful bidder’s proposal shall be followed and are incorporated by reference

11.8 NOTICE TO PROCEED
The issuance of a contractual services agreement will act as a notice to proceed. Vendor is advised not to perform work or provide materials without first obtaining a Contractual Services Agreement. The City will not allow payment for any work performed or goods delivered prior to the execution date or issue date of the Contractual Services Agreement.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 30 of 42

4.M.c
Packet Pg. 841 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

11.9 RIGHTS RESERVED
The City reserves the right to award the bid to separate bidders on any of the items as provided in and set forth in the bidder’s proposal. It is further understood that if the bidder to whom any award is made fails to enter into a contract, award may be made to the next best bidder, who shall be bound to perform as if she, he or it received the award in the first instance.

Each bidder may bid on any or all of the above listed items, or any combination of such items, and the City reserves the right to award on the best bid as to each item whether such bid be by the same bidder or different bidders.

The City further reserves the right to reject any or all bids, to waive any informality or irregularity in any bid or the bidding procedure, and to delete any items of work in the award of contract.

AMERICANS WITH DISABILITIES ACT (ADA) REQUIREMENTS
If this Notice Inviting Bids contemplates the provision of services to the public, bidder shall, in addition to any other requirements under ADA, comply with the Title II requirements of the ADA regarding the accessibility of City services and programs, as an explicit requirement. Bidder assures that, at all times during the performance of any resulting contractual services agreement, no qualified individual with a disability shall, by reason of that disability, be excluded from participation in, or be denied benefits of, services, programs, or activities performed by vendor for the benefit of the City.

FAIR EMPLOYMENT AND HOUSING ACT
Bidder agrees in accordance with California Labor Code sections 1735 and 1777.6, and the California Fair Employment and Housing Act, California Government Code sections 12900 et seq. that in the hiring of common or skilled labor for the performance of any work contemplated under this Notice Inviting Bids, no contractor, material supplier or vendor shall, by reason of age (over 40), ancestry, color, mental or physical disability, sex, gender identity and expression, marital status, medical condition (cancer or genetic characteristics), national origin, race, religious belief, or sexual orientation, discriminate against any person who is qualified and available to perform the work to which such employment relates. Bidder further agrees to be in compliance with the City of Santa Monica’s Non-Discriminatory Policy.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 31 of 42

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Packet Pg. 842 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
12 Certification Regarding Debarment
This certification must be completed for your bid/proposal to be considered. Proposer will be asked to confirm this statement in your electronic response.

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

1.) The Bidder and/or any of its Principals, contractors, subcontractors and sub recipients are not presently debarred, suspended, proposed for debarment, or declared ineligible for the award of or voluntarily excluded from participating in contracts by any Federal agency and are not presently on the Excluded Parties List System (EPLS) or being considered for the EPLS OR ineligible to work on contracts for violations of California Labor Code Sections 1777.1 or 1777.7; and

2.) If awarded a contract, the Bidder shall provide immediate written notice to City of Santa Monica, Procurement if, at any time, the Bidder learns that the certification provided herein was erroneous when submitted or has become erroneous by reason of changed circumstances. “Principals”, for purposes of this certification, means officers, directors, owners, partners, and persons having primary management or supervisory responsibilities within a business entity (e.g., general manager, plant manager, head of a subsidiary, division, or business segment, and similar position).

A certification that any of the items listed herein exists will not necessarily result in withholding of an award under this solicitation. However, the certification will be considered in connection with a determination of the Bidder’s responsibility. Failure of the Bidder to furnish a certification or provide such additional information as requested by City of Santa Monica may render the Bidder non-responsive. Nothing contained in the foregoing shall be construed to require establishment of a system of records in order to render, in good faith, the certification required herein. The knowledge and information of the Bidder is not required to exceed that which is normally possessed by a prudent person in the ordinary course of business dealings. The certification required herein is a material representation of fact upon which reliance was placed when making award. If it is later determined that the Bidder knowingly rendered an erroneous certification, in addition to other remedies available to the City, the City of Santa Monica may terminate the contract resulting from this Request for Quotation for default and pursue any other available legal remedies.

By confirming in the Electronic Response Section, I, the undersigned, declare under penalties of perjury that the forgoing certifications and assurances, any other statements made by me are true and correct.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 32 of 42

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Packet Pg. 843 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
13 Vendor Submission

13.1 Offer Confirmation*
We hereby offer to sell the City of Santa Monica the material and/or service at the prices described herein and under the terms and conditions hereon or attached or referenced. ☐ Please confirm
*Response required

13.2 Insurance Requirements for Vendors Providing Services* The Minimum Scope of Limits of Insurance can be found in the section titled Insurance Requirements.

Vendor shall procure and maintain for the duration of the Agreementinsurance against claims for injuries to persons or damages to property that may arise from or in connection with the performance of the work hereunder by the Vendor, its agents, representatives, employees or subcontractors.
☐ Yes
☐ No
*Response required

13.3 Certification Regarding Debarment, Suspension, Proposed Debarment, and Other Responsibility Matters*
By confirming below, I declare under penalties of perjury that the forgoing certifications and assurances, any other statements made by me are true and correct. ☐ Yes
☐ No
*Response required

13.4 Non-Discrimination Policy Acknowledgment*
The undersigned has checked carefully all of the documents contained in this NonDiscrimination Policy Acknowledgment.

I agree that the representations herein are made under penalty of perjury. ☐ Please confirm
*Response required

13.5 Payment Terms
Please enter payment discount terms; otherwise net thirty (30) days will apply if left blank Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 33 of 42

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Packet Pg. 844 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

13.6 Certificate of Compliance*
Please download the below documents, complete, and upload. • Certification_of_Compliance...
*Response required

13.7 Non-Collusion Declaration *
Please download the below documents, complete, and upload. • Non-Collusion_Form_(17).pdf
*Response required

13.8 Can comply with all specifications.*
Failure to comply with Proposal Standards and Specifications will disqualify bid. ☐ Yes
☐ No
*Response required

13.9 Upload proof that staff hold a current commercial driver's license and the necessary licensing and insurance coverage to transport 30', 40' and 60' buses as required by Federal, State and local Laws, Rules and Regulations.*
*Response required

13.10Vendor has sent required samples.*
Bidders shall supply, as part of their bid the following to be sent to:

Santa Monica Department of Transportation Maintenance Div.

Attn: David Nanjo,1660 7th St, Santa Monica, CA 90401
• Paint coupon on 12” X 12” aluminum plate with Axalta BS537-EW or equivalent • Paint coupon on 12” X 12” aluminum plate with Axalta BS540-EW or equivalent ☐ Please confirm
*Response required

13.11Provide a description of your company, number of years in business, number of employees and list of current transit customers.*
*Response required
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 34 of 42

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Packet Pg. 845 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

13.12Upload MSDS of proposed paints, primers, pretreatment, additives, lacquer thinners and other related products that would be used to prepare and paint transit buses. *
*Response required

13.13Does vendor have a fully enclosed paint booth in their facility; all painting shall be performed in a paint booth. Bidder must have the ability to accommodate painting of 60’ buses in compliance with applicable Federal, State and local laws, rules and regulations. *
☐ Yes
☐ No
*Response required

13.14Will all work be performed at bidders/subcontractor's location?* ☐ Yes
☐ No
*Response required

13.15Provide references for a minimum of five (5) years of full-time experience repairing and painting transit coach body damage caused by collision, rust, aging, and/or any interior and exterior damage. Bidder must have experience performing body repairs and painting on transit buses. *
*Response required

13.16Bidders must provide, as part of your bid, an experience statement including a list of clients and the size of the bidders contracts with those clients.*
*Response required

13.17Provide proof bidder technicians have successfully completed the hands-on training and evaluation to meet the requirements of EPA rule 40 CFR part 63 Subpart HHHHHH National Emission Standards for Hazardous Air Pollutants. *
*Response required
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 35 of 42

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Packet Pg. 846 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

13.18Bidders’ repair facilities must be licensed by all Federal, State, and Local (City) governments and must have these licenses posted in their offices. Provide a copy of license as part of this bid.*
*Response required

13.19Oaks Initiative*

CITY OF SANTA MONICA OAKS INITIATIVE NOTICE

NOTICE TO APPLICANTS, BIDDERS, PROPOSERS AND OTHERS SEEKING

DISCRETIONARY PERMITS, CONTRACTS, OR OTHER BENEFITS FROM THE CITY OF

SANTA MONICA
Santa Monica’s voters adopted a City Charter amendment commonly known as the Oaks Initiative. The Oaks Initiative requires the City to provide this notice and information about the Initiative’s requirements. You may obtain a full copy of the Initiative’s text from the City Clerk.

This information is required by City Charter Article XXII—Taxpayer Protection. It prohibits a public official from receiving, and a person or entity from conferring, specified personal benefits or campaign advantages from a person or entity after the official votes, or otherwise takes official action, to award a “public benefit” to that person or entity. The prohibition applies within and outside of the geographical boundaries of Santa Monica.

All persons or entities applying or receiving public benefits from the City of Santa Monica shall provide the names of trustees, directors, partners, and officers, and names of persons with more than a 10% equity, participation or revenue interest. An exception exists for persons serving in those capacities as volunteers, without compensation, for organizations exempt from income taxes under Section 501(c)(3), (4), or (6), of the Internal Revenue Code. However, this exception does not apply if the organization is a political committee or controls political committees. Examples of a “public benefit” include public contracts to provide goods or services worth more than $25,000 or a land use approval worth more than $25,000 over a 12-month period.

In order to facilitate compliance with the requirements of the Oaks Initiative, the City compiles and maintains certain information. That information includes the name of any person or persons who is seeking a “public benefit.” If the “public benefit” is sought by an entity, rather than an individual person, the information includes the name of every person who is: (a) trustee, (b) director, (c) partner, (d) officer, or has (e) more than a ten percent interest in the entity.

Therefore, if you are seeking a “public benefit” covered by the Oaks Initiative, you must supply that information on the Oaks Initiative Disclosure Form. This information must be updated and supplied every 12 months.
• Oaks_Initiative_Disclosure_...
• OAKS_INITIATIVE_FORM_-_Exam...
*Response required
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 36 of 42

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Packet Pg. 847 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

13.20Levine Act Disclosure Form*
Please download the below documents, complete, and upload. • Levine_Act_Disclosure_Form.pdf
• Disclosure_Form_cover_memo.pdf
*Response required

13.21Living Wage Ordinance Certification*

CITY OF SANTA MONICA LIVING WAGE ORDINANCE
Certification for Providers of Services to the City of Santa Monica (Fiscal Year 25/26 – July 1, 2025 through June 30, 2026)

TO BE COMPLETED BY ALL CONTRACTORS PROVIDING SERVICES TO THE CITY OF SANTA MONICA IN EXCESS OF $54,200
The City of Santa Monica Municipal Code Chapter 4.65, Living Wage Ordinance (LWO), establishes a Minimum Wage of $22.50 per hour for certain employees of contractors providing services to the City where services exceed $54,200 or more and requires that contractors also provide the same health care and other benefits to employees’ same sex spouses and domestic partners as are provided to other employees’ spouses.

An employee covered by the LWO is any person who does not actually work as a manager, supervisor, or confidential employee, and who is not required to possess an occupational license.

The Living Wage Ordinance applies the services sought pursuant to this bid and bidders are required to prepare and return the Living Wage Certification Form. If the bidder is selected, the bidder must maintain payroll records that include, at minimum, the full name of each employee providing services under the contract, job classification and rate of pay. Bids that fail to include Certification Forms may be considered non-responsive and excluded from further consideration.

Please prepare the following certification if you are a contractor engaging in a contract for services with the City of Santa Monica in excess of $54,200.

Your signature on this certification grants the City permission to review any and all payroll books and records and any company documents pertaining to the benefits offered to employees to assure your compliance with the LWO during the term of the contract.

Please direct any questions to:

City of Santa Monica Finance Department
Attention: Living Wage Compliance Section
1685 Main Street, Mail Stop 09
Santa Monica, CA 90401
You can also contact staff regarding living wage ordinance questions by e-mail at [email protected] or by phone 310-458-8281.
• FY25-26_Living_Wage_Certifi...
*Response required
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 37 of 42

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Packet Pg. 848 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

13.22Business License
Proposers must answer these questions below. Note, the business license documentation is only required from the successful Proposer.

13.22.1 Is Vendor physically located in the City of Santa Monica?* If YES, Vendor must have a City of Santa Monica Business License. Contact the Business License unit for the appropriate forms.

If NO, continue to next question.
☐ Yes
☐ No
*Response required

13.22.2 Does this vendor physically come into the City of Santa Monica to conduct business and/or make deliveries?*
If YES, Vendor must have a City of Santa Monica Out-of City Business License. Contact the Business License unit for the appropriate forms.

If NO, no license is needed.
☐ Yes
☐ No
*Response required

13.22.3 Additional Requirements*
Is the vendor located in or will the vendor come into the City of Santa Monica to conduct business,
then answer YES, and in addition to having a CITY OF SANTA MONICA BUSINESS LICENSE, Vendor will be required to have insurance (see Insurance Requirements Section for descriptions).
☐ Yes
☐ No
*Response required

13.23Subcontractors

13.23.1 Proposed Subcontractors
Please download the below documents, complete, and upload. • Proposed_Subcontractor_Form...

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 38 of 42

4.M.c
Packet Pg. 849 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs

13.23.2 Certification of Subcontractor Insurance Compliance* This is to certify that all requirements for insurance of subcontractors as specified have been met.
☐ Please confirm
*Response required

13.23.3 For Consideration: Exceptions to Terms & Conditions and/or Contractual Services Agreement

13.24Term
The City is inviting bids for a firm-fixed contract for a term of Five (5) years

13.24.1 Period 2 (First Annual Renewal Option)

13.24.2 Period 3 (Second Annual Renewal Option)

13.24.3 Period 4 (Third Annual Renewal Option)

13.24.4 Period 5 (Fourth Annual Renewal Option)
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 39 of 42

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Packet Pg. 850 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
14 Pricing Proposal

BUS BODY REPAIRS
Line Item Description Quantity Unit of
Measure
Comments Unit Cost Total
1 Body Repair 3,000 $/hr.
2 Refinish and Painting
Labor
4,000 $/hr.
3 Mechanical Repair
Labor
400 $/hr.
4 Fabrication Labor 400 $/hr.
5 Body Repair Labor
Overtime
25 $/hr.
6 Refinish and Painting
Labor Overtime
25 $/hr.
7 Mechanical Repair
Labor Overtime
10 $/hr.
8 Fabrication Labor
Overtime
10 $/hr.

TOTAL

OTHER COSTS
Line Item Description Unit of
Measure
Comments Unit Cost
9 Pickup and Delivery (Round Trip -
Portal to Portal)
$/hr.
10 Mark-up on Parts (bus parts) %
11 Mark-up on Paint (Primer, additive,
paint & additive, acdtone, paint
thinner, reducer etc.)
%
12 Mark-up on Materials (Sand paper,
tape, masking paper etc.)
%
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
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Packet Pg. 851 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
Line Item Description Unit of
Measure
Comments Unit Cost
13 Miscellaneous Material (All other
materials & supplies)
%
14 Disposal Cost (Hazardous Waste
per EPA Standards) Manifest sent
Monthly
$ or %
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 41 of 42

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Packet Pg. 852 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) City of Santa Monica
SaMoDOT
Request for Proposals
Transit Bus Body and Paint Repairs
15 Evaluation Phases
No. Evaluation Criteria Scoring Method Weight (Points)

1. COST N/A N/A

2. EXPERIENCE N/A N/A
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. A - RFP Transit Bus Body and
Paint Repairs
Pg. 42 of 42

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Packet Pg. 853 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Exhibit B
Excerpts from CGI Response to SMDOT’s RFP

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Packet Pg. 854 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) 1619 E. Creston Ave
Signal Hill CA, 90755
CG Inc. is a Southern California Corporation established in 1984, providing accident estimations & assessments for nationwide Bus and Rail Transportation. We cover repaint, accident damage repair, and renovation services. We work with City, State, Federal and private transportation organizations throughout the U.S.

C.G. Inc. employs and contracts highly trained staff which includes structural, electrical, mechanical, air brake, hydraulic, power-train, structural car body, specialty welding, and paint expertise. We want to assure our customers the highest level of consistency and completion of timely projects.

Our customer-focused philosophy provides the premier service in the United States. Our renovation, overhaul, upgrade, accident structural repair and modification experiences are unequaled in the industry. Our technical expertise allows us to consistently deliver above the OEM standard, combined with the managerial experience and professional relationships that are essential to a successful project conclusion. All our employees undergo extensive management, technical, and safety training programs, which makes our staff some of the best in the bus and rail transportation renovation services.

Our core competency is Rolling Stock Repaint, Car body Accident Repair, Renovation, and retrofitting, reverse engineering of obsolescence materials of bus, Heavy/Light rail vehicle, EMU/DMU, locomotive, commuter and passenger vehicles, with technical and professional expertise that is the highest in the industry. These include many years of Transit Vehicle, railroad locomotive, passenger vehicle and bus carbody repairs.

C.G. Inc. staff understands the complexities of established business practices, techniques and methodologies that are accepted by and in compliance with policies, regulations and guidelines of the Federal Railroad Administration (FRA), American Public Transit Association (APTA), Association of American Railroads (AAR), Occupational Safety & Health Administration (OSHA) and CAL-OSHA, and all freight, Commuter, and passenger rail standards.

C.G. Inc. currently has 16 full-time employees.

Our current transit customers are: San Diego MTS, Siemens Mobility, Santa Monica DOT, Denver Transit Operators, Los Angeles DASH (MV Transportation), North County Transit District (MV Transportation), Tumbleweed, and Hitachi, among others.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 1 of 23

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Packet Pg. 855 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 2 of 23

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Packet Pg. 856 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) 1619 E. Creston Ave
Signal Hill CA, 90755
CG Inc. is a Southern California Corporation established in 1984, providing accident estimations & assessments for nationwide Bus and Rail Transportation. We cover repaint, accident damage repair, and renovation services. We work with City, State, Federal and private transportation organizations throughout the U.S.

C.G. Inc. employs and contracts highly trained staff which includes structural, electrical, mechanical, air brake, hydraulic, power-train, structural car body, specialty welding, and paint expertise. We want to assure our customers the highest level of consistency and completion of timely projects.

Our customer-focused philosophy provides the premier service in the United States. Our renovation, overhaul, upgrade, accident structural repair and modification experiences are unequaled in the industry. Our technical expertise allows us to consistently deliver above the OEM standard, combined with the managerial experience and professional relationships that are essential to a successful project conclusion. All our employees undergo extensive management, technical, and safety training programs, which makes our staff some of the best in the bus and rail transportation renovation services.

Our core competency is Rolling Stock Repaint, Car body Accident Repair, Renovation, and retrofitting, reverse engineering of obsolescence materials of bus, Heavy/Light rail vehicle, EMU/DMU, locomotive, commuter and passenger vehicles, with technical and professional expertise that is the highest in the industry. These include many years of Transit Vehicle, railroad locomotive, passenger vehicle and bus carbody repairs.

C.G. Inc. staff understands the complexities of established business practices, techniques and methodologies that are accepted by and in compliance with policies, regulations and guidelines of the Federal Railroad Administration (FRA), American Public Transit Association (APTA), Association of American Railroads (AAR), Occupational Safety & Health Administration (OSHA) and CAL-OSHA, and all freight, Commuter, and passenger rail standards.

C.G. Inc. currently has 16 full-time employees.

Our current transit customers are: San Diego MTS, Siemens Mobility, Santa Monica DOT, Denver Transit Operators, Los Angeles DASH (MV Transportation), North County Transit District (MV Transportation), Tumbleweed, and Hitachi, among others.

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 3 of 23

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Packet Pg. 857 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs)

CG INC EXPERIANCE
CG Inc. is a Southern California Corporation established in 1984, providing accident estimations & assessments for nationwide Bus and Rail Transportation. We cover repaint, accident damage repair, and renovation services. We work with City, State, Federal and private transportation organizations throughout the U.S.

C.G. Inc. employs and contracts highly trained staJ which includes structural, electrical, mechanical, air brake, hydraulic, power-train, structural car body, specialty welding, and paint expertise. We want to assure our customers the highest level of consistency and completion of timely projects.

Our core competency is Rolling Stock Repaint, Car body Accident Repair, Renovation, and retrofitting, reverse engineering of obsolescence materials of bus, Heavy/Light rail vehicle, EMU/DMU, locomotive, commuter and passenger vehicles, with technical and professional expertise that is the highest in the industry. These include many years of Transit Vehicle, railroad locomotive, passenger vehicle and bus carbody repairs.

C.G. Inc. currently has 16 full-time employees.

Our current transit customers are San Diego MTS, Siemens Mobility, Santa Monica DOT, Denver Transit Operators, Los Angeles DASH (MV Transportation), North County Transit District (MV Transportation), Tumbleweed, and Hitachi, among others.

CG INC CURRENT CONTRACTS
REFERENCE NO.1
Company Name: San Diego MTS
Point of Contact: Andy Goddard
Phone: 619-595-4904
Email: [email protected]
Project Award Date: May 2025
Original Contract Value: 28.8 Million
Status of Contract: Current
A. Terms and Scope of Contract: 5 Year Contract LRV Accident repair, Paint, and body work and part fabrication and administration. Consumable Supplier B. Identify Claims: NONE
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 4 of 23

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Packet Pg. 858 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) REFERENCE NO.2
Company Name: Santa Monica BBB
Point of Contact: Jesus OCampo
Phone: 310-633-1852
Email: [email protected]
Project Award Date: March 2023
Original Contract Value: 3.6 Million
Status of Contract: Current
A. Terms and Scope of Contract: 5 Year Contract. Accident repair, Paint, and body work and part fabrication and administration.

B. Identify Claims / Litigation or Settlements Associated with each Contract: NONE REFERENCE NO.3
Company Name: Denver RTD
Point of Contact: Dina Salama
Phone: 720-460-5830
Email: [email protected]
Project Award Date: January 2023
Original Contract Value: 1.79 Million
Status of Contract: Current
A. Terms and Scope of Contract: As Needed Basis. Accident repair, body work and part fabrication, welding and administration.

B. Identify Claims / Litigation or Settlements Associated with each Contract: NONE Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 5 of 23

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Packet Pg. 859 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 6 of 23

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Packet Pg. 860 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) The Standard of Excellence Since 1976
454 E Commercial St.

Los Angeles, CA 90012
Phone: (951) 201-4346

MV Transportation, Inc.

TO: Whom it may concern
RE: Letter of Recommendation
DATE: 3/10/2023
I am very please to recommend the services of Mr. Carlos Guzman, and his company, CG, INC. Mr. Guzman shows extreme, precise and thorough work in the repairs of the coaches that they complete for us. Mr. Carlos Guzman is a meticulous craftsman in the inspection of the work that his company performs.

On a particular note is the work that CG, Inc., has done is the collision repair on the Proterra Electric buses. The colors scheme always is matched perfect. They have OEM level of component fabrication, a true 5 to 10 years warranty on their workmanship and Axalta coating. If a damaged part is not available, they will fabricate it to OEM standards. We are very pleased with the work that Mr. Carlos Guzman and his company does, they do excellent repairs.

He also has an impeccable record with the Air Quality Management District.

They provide a safe environment for their staff and vehicles that they work on.

Sincerely,
Carroll White
Maintenance Manager
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 7 of 23

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Packet Pg. 861 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) March 12, 2023
Jesus Montes
Sr. Executive Officer, Vehicle Engineering & Acquisition Los Angeles Metro (LACMTA)
To Whom it May Concern,
As a senior transit executive officer with almost 30 years of experience supporting, executing, and overseeing transit capital projects, there are certain qualities that I look for in potential partners.

Those qualities include strong, hands-on leadership that cares about the quality of their product, values their relationship with the client, and is willing to take ownership of issues when they develop to quickly identify and implement mitigations.

I first met Mr. Carlos Guzman in 1997 when I was working for LTK Engineering Services as a consultant to SCRRA on the delivery of Metrolink’s commuter cars and locomotives. On this project Mr. Guzman’s company, CGI, supported the contractor addressing warranty items, primarily the significant paint failures and accident damage.

The paint work was challenging due to the size of the vehicle and that the exterior panels were secured with rivets, prone to paint runs. Further, the paint repairs were performed in a shop not originally intended for painting. Despite these challenges CGI consistently delivered show-room quality repairs to the agreed schedule. The accident repairs were also challenging as spare parts were not always available; however, CGI was somehow always able to either source the part, repair the damaged ones, or make their own. Further, Mr. Guzman was constantly on site ensuring that his team had the necessary information and resources to meet the client’s needs.

In the ensuing years I have witnessed and heard testimonials from my peers of Mr. Guzman and his company continuing to provide the same level of service and support.

I highly recommend Carlos and the entire CGI team to your agency. Please don’t hesitate to reach out to me with any further questions at 213.603.1976 or [email protected].

Jesus Montes
Sr. Executive Officer, Vehicle Acquisitions
Los Angeles Metro
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 8 of 23

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Packet Pg. 862 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 9 of 23

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Packet Pg. 863 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 10 of 23

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Packet Pg. 864 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Michael Cash
Dear Mr Guzman:

I wanted to congratulate you on the terrific unveiling of the renovation of the San Diego Trolley.

You did such an amazing job on this project – when I saw the trolley last summer, when it was a work in process, I never imagined how terrific it would ultimately turn out.

As Axalta, we are proud to be a part of this monumental project, and greatly appreciate including us in the special moment.

We greatly appreciate working with you and your team, Carlos, and look forward to the next projects together.

With kindest regards, Mike
Michael Cash
President – Industrial Coatings
Axalta Coating Systems
Two Commerce Square
2001 Market Street, 36 Floor
Philadelphia, PA 19103
(T) +1 215 255 4311
(M) +1 267 788 1998
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 11 of 23

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Packet Pg. 865 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Brendan Cotter
Letter of recommendation
To Whom It May Concern,
Over April and May of 2021, I had the pleasure of working with CG Inc. They were a subcontractor tasked with installing a Regional Transit Management System (RTMS) on nearly one-hundred (100) of North County Transit District’s (NCTD) buses. During this project I saw first-hand the effective labor management style, accurate inventory management, and thorough and effective communication that seemed to be part of their regular operation. With up to four (4) teams of installers working at a time, CG Inc. provided the necessary resources to ensure each benchmark deadline was met on time or early.

When issues arose, as are bound to happen in any project of this size of scope, CG Inc. was available, responsive, flexible, and solution-minded. They genuinely listened to any concerns I expressed, as was demonstrated by the product of their efforts.

Through this entire experience, everyone from CG Inc. exhibited professionalism, demonstrated proper and serious attention to safe practices, and provided an organized approach to the effort that I greatly appreciated. It is without reservation that I recommend CG Inc.

Thank you for your time and consideration,
Brendan Cotter
Bus Mechanical Officer
810 Mission Avenue | Oceanside, CA 92054 | 760.967.2877 | c: 760.994.2393 Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 12 of 23

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Packet Pg. 866 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) March 13, 2023
To Whom It May Concern:

It is with much enthusiasm that I recommend the services of Mr. Carlos Guzman, and his company, CGI Inc. for the mastery of their superior craftsmanship in the repair and refurbishment of public transit vehicles. Mr. Guzman has proven to be of the highest caliber in restoration, painting, coachwork, and a full range of structural and body repairs. His dedication to satisfying the customer, coordination of project to meet customer’s needs, and ability to work well with customer’s supervisory personnel makes for an efficient and effective partnership.

Above all, Mr. Guzman’s attention to detail is second to none which makes for a partner that you can trust.

I have witnessed firsthand of the incredible work done by CGI, Inc. Of note, is the work that CGI, Inc. had done to refurbish and rebuild trolley #162 at San Francisco Municipal. Mr. Carlos Guzman and CGI, Inc. used their expertise to perform a major retrofit. The finished work of CGI, Inc. was nothing less than perfection, transforming the car body into an appearance that we were proud to have represent San Francisco Municipal.

Feel free to contact me at (760) 239–1370 if you have any questions or would like me to further elaborate on the talents and achievements of Mr. Carlos Guzman and CGI, Inc.

Sincerely,
Lee Summerlott
Herzog General Manager OCTA Streetcar
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 13 of 23

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Packet Pg. 867 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs)

CG INC EXPERIANCE
CG Inc. is a Southern California Corporation established in 1984, providing accident estimations & assessments for nationwide Bus and Rail Transportation. We cover repaint, accident damage repair, and renovation services. We work with City, State, Federal and private transportation organizations throughout the U.S.

C.G. Inc. employs and contracts highly trained staJ which includes structural, electrical, mechanical, air brake, hydraulic, power-train, structural car body, specialty welding, and paint expertise. We want to assure our customers the highest level of consistency and completion of timely projects.

Our core competency is Rolling Stock Repaint, Car body Accident Repair, Renovation, and retrofitting, reverse engineering of obsolescence materials of bus, Heavy/Light rail vehicle, EMU/DMU, locomotive, commuter and passenger vehicles, with technical and professional expertise that is the highest in the industry. These include many years of Transit Vehicle, railroad locomotive, passenger vehicle and bus carbody repairs.

C.G. Inc. currently has 16 full-time employees.

Our current transit customers are San Diego MTS, Siemens Mobility, Santa Monica DOT, Denver Transit Operators, Los Angeles DASH (MV Transportation), North County Transit District (MV Transportation), Tumbleweed, and Hitachi, among others.

CG INC CURRENT CONTRACTS
REFERENCE NO.1
Company Name: San Diego MTS
Point of Contact: Andy Goddard
Phone: 619-595-4904
Email: [email protected]
Project Award Date: May 2025
Original Contract Value: 28.8 Million
Status of Contract: Current
A. Terms and Scope of Contract: 5 Year Contract LRV Accident repair, Paint, and body work and part fabrication and administration. Consumable Supplier B. Identify Claims: NONE
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 14 of 23

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Packet Pg. 868 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) REFERENCE NO.2
Company Name: Santa Monica BBB
Point of Contact: Jesus OCampo
Phone: 310-633-1852
Email: [email protected]
Project Award Date: March 2023
Original Contract Value: 3.6 Million
Status of Contract: Current
A. Terms and Scope of Contract: 5 Year Contract. Accident repair, Paint, and body work and part fabrication and administration.

B. Identify Claims / Litigation or Settlements Associated with each Contract: NONE REFERENCE NO.3
Company Name: Denver RTD
Point of Contact: Dina Salama
Phone: 720-460-5830
Email: [email protected]
Project Award Date: January 2023
Original Contract Value: 1.79 Million
Status of Contract: Current
A. Terms and Scope of Contract: As Needed Basis. Accident repair, body work and part fabrication, welding and administration.

B. Identify Claims / Litigation or Settlements Associated with each Contract: NONE Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 15 of 23

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Packet Pg. 869 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 16 of 23

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Packet Pg. 870 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) The Standard of Excellence Since 1976
454 E Commercial St.

Los Angeles, CA 90012
Phone: (951) 201-4346

MV Transportation, Inc.

TO: Whom it may concern
RE: Letter of Recommendation
DATE: 3/10/2023
I am very please to recommend the services of Mr. Carlos Guzman, and his company, CG, INC. Mr. Guzman shows extreme, precise and thorough work in the repairs of the coaches that they complete for us. Mr. Carlos Guzman is a meticulous craftsman in the inspection of the work that his company performs.

On a particular note is the work that CG, Inc., has done is the collision repair on the Proterra Electric buses. The colors scheme always is matched perfect. They have OEM level of component fabrication, a true 5 to 10 years warranty on their workmanship and Axalta coating. If a damaged part is not available, they will fabricate it to OEM standards. We are very pleased with the work that Mr. Carlos Guzman and his company does, they do excellent repairs.

He also has an impeccable record with the Air Quality Management District.

They provide a safe environment for their staff and vehicles that they work on.

Sincerely,
Carroll White
Maintenance Manager
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 17 of 23

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Packet Pg. 871 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) March 12, 2023
Jesus Montes
Sr. Executive Officer, Vehicle Engineering & Acquisition Los Angeles Metro (LACMTA)
To Whom it May Concern,
As a senior transit executive officer with almost 30 years of experience supporting, executing, and overseeing transit capital projects, there are certain qualities that I look for in potential partners.

Those qualities include strong, hands-on leadership that cares about the quality of their product, values their relationship with the client, and is willing to take ownership of issues when they develop to quickly identify and implement mitigations.

I first met Mr. Carlos Guzman in 1997 when I was working for LTK Engineering Services as a consultant to SCRRA on the delivery of Metrolink’s commuter cars and locomotives. On this project Mr. Guzman’s company, CGI, supported the contractor addressing warranty items, primarily the significant paint failures and accident damage.

The paint work was challenging due to the size of the vehicle and that the exterior panels were secured with rivets, prone to paint runs. Further, the paint repairs were performed in a shop not originally intended for painting. Despite these challenges CGI consistently delivered show-room quality repairs to the agreed schedule. The accident repairs were also challenging as spare parts were not always available; however, CGI was somehow always able to either source the part, repair the damaged ones, or make their own. Further, Mr. Guzman was constantly on site ensuring that his team had the necessary information and resources to meet the client’s needs.

In the ensuing years I have witnessed and heard testimonials from my peers of Mr. Guzman and his company continuing to provide the same level of service and support.

I highly recommend Carlos and the entire CGI team to your agency. Please don’t hesitate to reach out to me with any further questions at 213.603.1976 or [email protected].

Jesus Montes
Sr. Executive Officer, Vehicle Acquisitions
Los Angeles Metro
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 18 of 23

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Packet Pg. 872 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 19 of 23

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Packet Pg. 873 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 20 of 23

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Packet Pg. 874 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Michael Cash
Dear Mr Guzman:

I wanted to congratulate you on the terrific unveiling of the renovation of the San Diego Trolley.

You did such an amazing job on this project – when I saw the trolley last summer, when it was a work in process, I never imagined how terrific it would ultimately turn out.

As Axalta, we are proud to be a part of this monumental project, and greatly appreciate including us in the special moment.

We greatly appreciate working with you and your team, Carlos, and look forward to the next projects together.

With kindest regards, Mike
Michael Cash
President – Industrial Coatings
Axalta Coating Systems
Two Commerce Square
2001 Market Street, 36 Floor
Philadelphia, PA 19103
(T) +1 215 255 4311
(M) +1 267 788 1998
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 21 of 23

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Packet Pg. 875 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Brendan Cotter
Letter of recommendation
To Whom It May Concern,
Over April and May of 2021, I had the pleasure of working with CG Inc. They were a subcontractor tasked with installing a Regional Transit Management System (RTMS) on nearly one-hundred (100) of North County Transit District’s (NCTD) buses. During this project I saw first-hand the effective labor management style, accurate inventory management, and thorough and effective communication that seemed to be part of their regular operation. With up to four (4) teams of installers working at a time, CG Inc. provided the necessary resources to ensure each benchmark deadline was met on time or early.

When issues arose, as are bound to happen in any project of this size of scope, CG Inc. was available, responsive, flexible, and solution-minded. They genuinely listened to any concerns I expressed, as was demonstrated by the product of their efforts.

Through this entire experience, everyone from CG Inc. exhibited professionalism, demonstrated proper and serious attention to safe practices, and provided an organized approach to the effort that I greatly appreciated. It is without reservation that I recommend CG Inc.

Thank you for your time and consideration,
Brendan Cotter
Bus Mechanical Officer
810 Mission Avenue | Oceanside, CA 92054 | 760.967.2877 | c: 760.994.2393 Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 22 of 23

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Packet Pg. 876 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) March 13, 2023
To Whom It May Concern:

It is with much enthusiasm that I recommend the services of Mr. Carlos Guzman, and his company, CGI Inc. for the mastery of their superior craftsmanship in the repair and refurbishment of public transit vehicles. Mr. Guzman has proven to be of the highest caliber in restoration, painting, coachwork, and a full range of structural and body repairs. His dedication to satisfying the customer, coordination of project to meet customer’s needs, and ability to work well with customer’s supervisory personnel makes for an efficient and effective partnership.

Above all, Mr. Guzman’s attention to detail is second to none which makes for a partner that you can trust.

I have witnessed firsthand of the incredible work done by CGI, Inc. Of note, is the work that CGI, Inc. had done to refurbish and rebuild trolley #162 at San Francisco Municipal. Mr. Carlos Guzman and CGI, Inc. used their expertise to perform a major retrofit. The finished work of CGI, Inc. was nothing less than perfection, transforming the car body into an appearance that we were proud to have represent San Francisco Municipal.

Feel free to contact me at (760) 239–1370 if you have any questions or would like me to further elaborate on the talents and achievements of Mr. Carlos Guzman and CGI, Inc.

Sincerely,
Lee Summerlott
Herzog General Manager OCTA Streetcar
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. B - Excerpts from CGI
Response to SMDOT’s RFP
Pg. 23 of 23

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Packet Pg. 877 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Exhibit C
Notice of Award

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Packet Pg. 878 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) 3 Hi John D,
4506: Transit Bus Body and Paint Repairs has been recommended to:

A and A Fleet Painting Inc
A final notification will be sent once the award has been finalized.

View Project
Questions? We're happy to help! Please do NOT respond to this email and instead reach us at [email protected].

Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. C - Notice of Award
Pg. 1 of 4

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Packet Pg. 879 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs)

AWARD PENDING
Transit Bus Body and Paint Repairs
 Notice Inviting Bids
 SaMoDOT
 92800
Project ID: 4506
Release Date: Friday, October 10, 2025
Due Date: Monday, November 3, 2025 3:00pm
 Posted  Friday, October 10, 2025 11:24am
All dates & times in Pacific Time
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. C - Notice of Award
Pg. 2 of 4

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Packet Pg. 880 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Selected Vendor
Vendor recommended by the evaluation process
Consensus Scorecard
Pricing Results
Award Note:

None
A and A Fleet Painting Inc
aafleetpaintinginc.com
A and A Fleet Painting Inc 70 50 120
CG Inc. 59 50 109
FLEET COLLISION CENTER, INC. 44 10 54
Vendor COST
Points Based
70 Points (58.3%)

EXPERIENCE
Points Based
50 Points (41.7%)
Total Score
(Max Score 120)
Bus Body Repairs
Bus Body Repairs
Line Item Description Quantity Unit of Measure
A and A Fleet Painting Inc CG Inc.

Unit Cost Total Unit Cost
1 Body Repair 3000 $/hr.
2 Refinish and
Painting Labor
4000 $/hr.
3 Mechanical Repair
Labor
400 $/hr.
4 Fabrication Labor 400 $/hr.
5 Body Repair Labor
Overtime
25 $/hr.
6 Refinish and
Painting Labor
25 $/hr.
7 Mechanical Repair
Labor Overtime
10 $/hr.
8 Fabrication Labor
Overtime
10 $/hr.
 
$85.00 $255,000.00 $89.00
$70.00 $280,000.00 $89.00
$110.00 $44,000.00 $115.00
$100.00 $40,000.00 $115.00
$85.00 $2,125.00 $135.00
$70.00 $1,750.00 $135.00
$110.00 $1,100.00 $172.50
$100.00 $1,000.00 $172.50
Total $624,975.00
   
Columns
Other Costs
Other Costs
Line Item Description Unit of Measure
A and A Fleet Pain… CG Inc. FLEET COLLISION …
Unit Cost Unit Cost Unit Cost
9 Pickup and
Delivery (Round
$/hr.
10 Mark-up on Parts
(bus parts)
%
11 Mark-up on Paint %
$0.00 $75.00 $100.00
$25.00 $20.00 $25.00
$25.00 $20.00 $25.00
Columns
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. C - Notice of Award
Pg. 3 of 4

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Packet Pg. 881 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) 11 Mark up on Paint
(Primer, additive,
paint & additive,
%
12 Mark-up on
Materials (Sand
%
13 Miscellaneous
Material (All other
%
14 Disposal Cost
(Hazardous Waste
$ or %
$25.00 $20.00 $25.00
$25.00 $20.00 $25.00
$25.00 $20.00 $0.00
$45.00 $4.00 $8.00
Total $145.00 $159.00 $183.00
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. C - Notice of Award
Pg. 4 of 4

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Packet Pg. 882 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Exhibit D
CG Inc Experience and Current Contracts

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Packet Pg. 883 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs)

CG INC EXPERIANCE
CG Inc. is a Southern California Corporation established in 1984, providing accident estimations & assessments for nationwide Bus and Rail Transportation. We cover repaint, accident damage repair, and renovation services. We work with City, State, Federal and private transportation organizations throughout the U.S.

C.G. Inc. employs and contracts highly trained staJ which includes structural, electrical, mechanical, air brake, hydraulic, power-train, structural car body, specialty welding, and paint expertise. We want to assure our customers the highest level of consistency and completion of timely projects.

Our core competency is Rolling Stock Repaint, Car body Accident Repair, Renovation, and retrofitting, reverse engineering of obsolescence materials of bus, Heavy/Light rail vehicle, EMU/DMU, locomotive, commuter and passenger vehicles, with technical and professional expertise that is the highest in the industry. These include many years of Transit Vehicle, railroad locomotive, passenger vehicle and bus carbody repairs.

C.G. Inc. currently has 16 full-time employees.

Our current transit customers are San Diego MTS, Siemens Mobility, Santa Monica DOT, Denver Transit Operators, Los Angeles DASH (MV Transportation), North County Transit District (MV Transportation), Tumbleweed, and Hitachi, among others.

CG INC CURRENT CONTRACTS
REFERENCE NO.1
Company Name: San Diego MTS
Point of Contact: Andy Goddard
Phone: 619-595-4904
Email: [email protected]
Project Award Date: May 2025
Original Contract Value: 28.8 Million
Status of Contract: Current
A. Terms and Scope of Contract: 5 Year Contract LRV Accident repair, Paint, and body work and part fabrication and administration. Consumable Supplier B. Identify Claims: NONE
Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. D - CG Inc Experience and
Current Contracts
Pg. 1 of 2

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Packet Pg. 884 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) REFERENCE NO.2
Company Name: Santa Monica BBB
Point of Contact: Jesus OCampo
Phone: 310-633-1852
Email: [email protected]
Project Award Date: March 2023
Original Contract Value: 3.6 Million
Status of Contract: Current
A. Terms and Scope of Contract: 5 Year Contract. Accident repair, Paint, and body work and part fabrication and administration.

B. Identify Claims / Litigation or Settlements Associated with each Contract: NONE REFERENCE NO.3
Company Name: Denver RTD
Point of Contact: Dina Salama
Phone: 720-460-5830
Email: [email protected]
Project Award Date: January 2023
Original Contract Value: 1.79 Million
Status of Contract: Current
A. Terms and Scope of Contract: As Needed Basis. Accident repair, body work and part fabrication, welding and administration.

B. Identify Claims / Litigation or Settlements Associated with each Contract: NONE Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. D - CG Inc Experience and
Current Contracts
Pg. 2 of 2

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Packet Pg. 885 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Exhibit E
A &A Fleet Contracts Summary

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Packet Pg. 886 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) A & A Fleet Painting, Inc.
— California Contract Summary (2016
–2025)
The following summary provides an overview of known public agency contracts, task orders, and vendor listings for A & A Fleet Painting, Inc. of Chino, California, as identified in searches of agency records and board documents between 2016 and 2025.

Agency / Jurisdiction Contract or
PO #
Role Scope Summary Award
Amount (USD)
Dates Verification
Notes
North County Transit District (San Diego County)
Agreement No. 17048
Prime Replace carpet in up to
six COASTER 2500
-series
bi
-level cars
$142,290 May
–Sept 2017 Found in board
materials
San Diego Metropolitan Transit System (MTS)
— Proposer (not
award)
Listed as responsive & responsible proposer on an RFP
— April 2020 Found in agenda
packet
Victor Valley Transit Authority (VVTA, San Bernardino County) RFP 2024
-04
(Addendum No. 2)
Subcontractor (DBE)
Named among incumbent contractor’s active subcontractors — Jan
–Mar 2024 Found in
addendum
Omnitrans (San Bernardino County)
MNT23
-42;
multiple POs
Vendor / Prime for task orders
Bus paint & body repairs $149,000 +
$50,000
May & July 2023
Found in board/PO records
SunLine Transit Agency (Coachella Valley)
— Vendor Bus rehab painting &
decals
$35,395.38 May 22, 2024 Found in board
register
Metrolink / SCRRA (Southern California)
BPO PO521
-
13 Prime (Recommended)
Exterior cleaning of locomotives & passenger rail cars
$120,000 Jan 25, 2013
(historical)
Found in committee minutes
Note: These records represent publicly verifiable contracts, bids, and vendor listings for A & A Fleet Painting, Inc. Further verification may be obtained from individual agency procurement archives or court filings.

Carlos Guzman, Inc. v. City of Santa MonicaBid Protest - Project ID: 4506 Exh. E - A &A Fleet Contracts Summary
Pg. 1 of 1

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Packet Pg. 887 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Exhibit F
A&A Permit No 14120

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Packet Pg. 888 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. F - A&A Permit No 14120
Pg. 1 of 3

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Packet Pg. 889 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. F - A&A Permit No 14120
Pg. 2 of 3

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Packet Pg. 890 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. F - A&A Permit No 14120
Pg. 3 of 3

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Packet Pg. 891 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Exhibit G
A&A Permit No 14119

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Packet Pg. 892 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. G - A&A Permit No 14119
Pg. 1 of 3

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Packet Pg. 893 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. G - A&A Permit No 14119
Pg. 2 of 3

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Packet Pg. 894 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Carlos Guzman, Inc. v. City of Santa Monica
Bid Protest - Project ID: 4506
Exh. G - A&A Permit No 14119
Pg. 3 of 3

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Packet Pg. 895 Attachment: Protest Letter - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Department of Finance | 1685 Main Street, Mail Stop 09 | Santa Monica, CA 90401 [email protected] | santamonica.gov/departments/finance Tel: (310) 458-8281 Fax: (310) 394-0647
Sent Via: [email protected]
[email protected]
[email protected]
[email protected]
December 4, 2025
Lewis Brisbois Bisgaard & Smith LLP
Joshua S. Hodas, SB #250802
[email protected]
Tamara McNulty (Washington DC Bar No 1022637)
[email protected]
Garrett A Dean (Colorado Bar No 41924)
[email protected]
Maria K Shockley (Tennessee Bar No 40528)
[email protected]
2112 Pennsylvania Avenue NW, Suite 500
Washington, DC 20037
Attorneys for Carlos Guzman, Inc
Re: Response to Letter for Request for Proposal No. 4506 Parking Operations Management Dear Mr. Hodas, et al,
The City of Santa Monica (“City”) is in receipt of your November 25, 2025 bid protest (“Protest”) of the staff-recommended best bidder for Transit Bus Body and Paint Repairs/Bid ID #4506/Project #194716 (“Bid”). Upon reading the Protest, a review was conducted of the Request for Bid (“RFB”) and the Bid responses. Based on the review, the Protest is denied.

A summary of the Protest’s main points is as follows:

1. A bid determination is arbitrary, capricious and procedurally unfair if the posted RFB does not contain weighted scores.

2. The recommended best bidder does not comply with the vendor requirements in Section 4.2 of the RFB. Specifically, you argue that the recommended best bidder does not maintain required painting facilities. Additionally, you argue that the recommended best

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Packet Pg. 896 Attachment: Protest City Response - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Department of Finance | 1685 Main Street, Mail Stop 09 | Santa Monica, CA 90401 [email protected] | santamonica.gov/departments/finance Tel: (310) 458-8281 Fax: (310) 394-0647
bidder has not developed the minimum relevant full-time experience on similar sized projects.

3. The equal ranking in experience of both you and the recommended best bidder is arbitrary and capricious.

The Protestis denied for the following reasons:

1. The RFB includes evaluation factors and their relevant importance. In the Bid Award Criteria, the City is upfront that bids are evaluated based on pricing, availability, experience, and references. The Protest does not cite, nor does there appear to be, any statutory requirement or common law ruling requiring the numerical or percentage ratings or rates be specified in a bid.

2. The recommended best bidder submitted its bid response in acknowledgement of the vendor requirements in Section 4.2 and the compliance and deviation to specifications language in Section 5.3. The recommended best bidder did not submit an Exceptions to Specifications form describing any of the exceptions or noncompliance arguments listed in the Protest. Additionally, through follow up correspondence, the recommended best bidder confirmed its compliance to City staff.

3. In evaluating a bidder’s experience, the selectors reviewed the bidder’s response for compliance with the bid specifications. The selectors then called the references listed in bidders’ experience statements to validate bidders’ submittals. The bidder references were asked questions related to the quality of work and turnaround times, ability and experience performing body repairs and paint on 60’ buses, ability to perform custom fabrication, and experience providing quotes prior to starting repair work and providing pictures of repair work in progress. The selectors also asked for an overall appraisal of their experience working with a bidder and if they would recommend them. If a bidder’s references validated that the bidder has experience performing all specified work and indicated that their experience with a bidder had been positive, the bidder scored full points for experience. Accordingly, both the recommended best bidder and you received the full score. Price was evaluated based on the unit cost proposal submitted by each bidder, multiplied by the estimated quantities posted in the bid and calculated over an estimated five-year contract including any proposed price increases submitted by bidders in bid section 24. The lowest bidder was awarded full points for price with higher bidders being awarded lower points based on the difference in bid price from the lowest bidder.

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Packet Pg. 897 Attachment: Protest City Response - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) Department of Finance | 1685 Main Street, Mail Stop 09 | Santa Monica, CA 90401 [email protected] | santamonica.gov/departments/finance Tel: (310) 458-8281 Fax: (310) 394-0647
As a result of the reviewed points above, the Protest is denied, and relief will not be granted.

This written determination shall constitute the City's final decision on the protest.

In closing, the City appreciates your participation in our solicitation process. Should you have any further questions, please contact our Procurement Manager Teresa Villa at [email protected] 310-458-8242.

Sincerely,
Oscar Santiago
Finance Director / City Treasurer
Cc: Request for Proposal No. 4506 File
Procurement Manager
Buyer of Record
Department of Transportation Director

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Packet Pg. 898 Attachment: Protest City Response - BID 4506 - CG Inc. (7417 : Award Bid for Bus Body and Paint Repairs) 1 December 16, 2025
(NOT APPROVED)

CITY OF SANTA MONICA

CITY COUNCIL MINUTES
DECEMBER 16, 2025
A regular meeting of the Santa Monica City Council was called to order by Mayor Torosis at 5:30 p.m., on Tuesday, December 16, 2025, at City Council Chambers, 1685 Main Street, Santa Monica, CA. There was no longer a teleconference site at Four Points Sheraton San Rafael Hotel, 1010 Northgate Drive, San Rafael, CA 94903.

Roll Call: Present: Mayor Caroline Torosis
Mayor Pro Tem Jesse Zwick (arrived at 5:35 p.m. and left at 11:44 p.m.) Councilmember Lana Negrete
Councilmember Dan Hall
Councilmember Ellis Raskin
Councilmember Barry Snell
Councilmember Natalya Zernitskaya
Also Present: City Manager Oliver Chi
Interim City Attorney Heidi von Tongeln
Assistant City Clerk Maria Dacanay-Wisner
CONVENE/PLEDGE On order of the Mayor, the City Council convened at 5:30 p.m., with all members present except Mayor Pro Tem Zwick. Councilmember Raskin led the assemblage in the Pledge of Allegiance.

STATEMENT OF

ACCOUNTABILITY
(LAND

ACKNOWLEDGEMENT)
The City of Santa Monica Statement of Accountability (Land Acknowledgement) was read into the record by Councilmember Negrete.

LEVINE ACT

DISCLOSURE
No Councilmembers made disclosures pursuant to the Levine Act (Govt Code Section 84308).

Councilmember Raskin announced that he will recuse himself from items

10.A. and 12.B - 12.E.

AGENDA

MANAGEMENT
Motion by Councilmember Raskin, seconded by Councilmember Snell to hear: the Mayor’s Highlight after 1.A. (General Public Input); Closed Session items 5.F. – 5.I. after the 16-items (Councilmember Discussion Items); and items 11.A. (Major Events) and 12.A. (Self-Certification Pilot) before 10.A. (Digital Display District). The motion was approved by voice vote with Mayor Pro Tem Zwick absent.

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Packet Pg. 899 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 2 December 16, 2025

PUBLIC INPUT FOR

GENERAL PUBLIC
COMMENT:
(Mayor Pro Tem Zwick
arrived at 5:35 p.m.)
Members of the public Jeff Wynne, Jerry Rubin, Denise Barton, Johnathan Foster, Sean Del Gaudio, Steven Price and Michael Montgomery commented on various local issues.

PUBLIC INPUT FOR

CONSENT CALENDAR

AND CLOSED SESSION
ONLY:

Member of the public Denise Barton commented on item 5.A.

Member of the public Harvey Eder commented on various local issues.

MAYOR’S HIGHLIGHT The Mayor’s Highlight was presented.

CONSENT CALENDAR:

JOINT MEETING WITH

THE REDEVELOPMENT

SUCCESSOR AGENCY

REPORT ON MEETING

COMPENSATION
There being a Consent Calendar for the City Council and the Redevelopment Successor Agency, motion by Council/Agency Member Hall, seconded by Council/Agency Member Raskin to hear the two Consent Calendars concurrently. The motion was approved by the following roll call vote:

AYES: Council/Agency Members Negrete, Hall, Raskin, Snell, Zernitskaya, Mayor/Chair Pro Tem Zwick, Mayor/Chair
Torosis
NOES: None
ABSENT: None
The Council convened to a joint meeting with the Redevelopment Successor Agency at 5:59 p.m. Pursuant to State law, the Clerk announced that Council will receive no compensation for meeting as the Redevelopment Successor Agency.

All items were considered and approved in one motion unless removed by a Councilmember for discussion. The Clerk announced a correction for item

4.I. (December 9, 2025 minutes), that item 5.A should state that it was “Not heard”.

Motion by Council/Agency Member Snell, seconded by Council/Agency Member Zernitskaya, to approve the Consent Calendar including the correction for Item 4.I, reading resolutions by title only and waiving further reading thereof. The motion was approved by the following roll call vote:

AYES: Council/Agency Members Zernitskaya, Snell, Raskin, Hall, Negrete, Mayor/Chair Pro Tem Zwick, Mayor/Chair Torosis NOES: None
ABSENT: None

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Packet Pg. 900 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 3 December 16, 2025

CALRECYCLE

BERVARAGE

CONTAINER

RECYCLING PROGRAM

4.A. Adoption of Resolution No. 11724 (CCS) Authorizing Participation in the CalRecycle Beverage Container Recycling City/County Payment Program, was adopted.

Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California
Environmental Quality Act (CEQA) Guidelines; and

2. Adopt attached Resolution No. 11724 (CCS) authorizing the City Manager to submit and execute applications, agreements, and annual reports for the CalRecycle Beverage Container Recycling City/County Payment Program.

TRACT MAP 4.B. Adoption of Resolution No. 11725 (CCS) Approving Final Parcel Map No. 83963 for a Three Unit Condominium Project at 2012 19th Street, was adopted.

Recommended Action
Staff recommends that the City Council take the following actions:

1. Adopt a finding of Statutory Exemption (Approval of Final Subdivision Map) pursuant to Section 15268(b)(3) of the California Environmental Quality Act; and

2. Adopt attached Resolution No. 11725 (CCS) approving Final Parcel Map No. 83963 for a Three Unit Condominium Project at 2012 19th Street.

AGING AND DISABILITY

CONSULTING SERVICES

4.C. Approval of First Modification to Agreement No. 11564 (CCS) with Elizabeth Anderson Consulting for Aging & Disability Strategic Planning Implementation Consulting Services, was approved.

Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California
Environmental Quality Act (CEQA) Guidelines;

2. Authorize the City Manager to negotiate and execute a first modification to Agreement No. 11564 (CCS) in the amount of $63,000 with Elizabeth Anderson Consulting to provide consulting services for the citywide Aging and Disability Action Plan for the Housing & Human Services Department. This will result in a 5-year amended agreement with a new total amount not to exceed $218,000, with future year funding contingent on Council budget approval.

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Packet Pg. 901 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 4 December 16, 2025

EMERGENCY

FINANCIAL

ASSISTANCE SERVICES

4.D. Approval of Third Modification of Grant Agreement No. 11433 (CCS) for Haven Neighborhood Services for Emergency Financial Assistance Services for the Housing and Human Services Department, was approved.

Recommended Action
Staff recommends that City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California
Environmental Quality Act (CEQA) Guidelines;

2. Authorize the City Manager to negotiate and execute a third modification to Agreement No. 11433 (CCS) in an amount of $250,000 with Haven Neighborhood Services, for emergency financial assistance services for the Housing and Human Services Department. This will result in a fouryear amended agreement with a new total amount not to exceed $804,173, with future funding contingent upon Council budget approval.

OCCUPATIONAL

MEDICAL TESTING

PROGRAM

4.E. Approval of Second Modification to Professional Services Agreement No. 11727 (CCS) with USMD Direct Inc. and Pacific Harbor Medical Group Inc. for Occupational Medical Testing Program Services, was approved.

Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines; and

2. Authorize the City Manager to negotiate and execute a second modification to Agreement No. 11727 (CCS) in the amount of $138,000 with Pacific Harbor Medical Group Inc. for occupational medical testing services for the Human Resources Department. This will result in a 23- month amended agreement with a new total amount not to exceed $369,850, with future year funding contingent on Council budget approval.

ON-SITE

OCCUPATIONAL

MEDICAL TESTING

SERVICES

4.F. Approval of Second Modification of Agreement with USMD Direct Inc. for On-Site Occupational Medical Testing Services, was approved.

Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines; and

2. Authorize the City Manager to negotiate and execute a second modification to Agreement No. 11001 (CCS) in the amount of $76,000

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Packet Pg. 902 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 5 December 16, 2025
with USMD Direct Inc. for on-site Occupational Medical Testing Services for the Human Resources Department. This will result in a 6- year, and 1-month amended agreement with a new total amount not to exceed $476,000, with future year funding contingent on Council budget approval.

LOW-MODERATE

INCOME HOUSING

ASSET FUND

4.G. Annual Report on Low-Moderate Income Housing Asset Fund for Fiscal Year 2024-25, was approved.

Recommended Action
Staff recommend the Redevelopment Successor Agency:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California
Environmental Quality Act (CEQA) Guidelines;

2. Receive the Annual Report on the Low- and Moderate-Income Housing Asset Fund for Fiscal Year 2024-25 and authorize the City Manager to post the report on the City's website by December 31, 2025; and

3. Direct the City Manager to present the independent audit of the Low- and Moderate-Income Housing Asset Fund to the City Council upon completion of the independent audit of the City’s Annual Comprehensive Financial Report (ACFR) and authorize the City Manager to post the results of the audit on the City's website after presentation to City Council.

MINUTES 4.H. Approval of Minutes for Redevelopment Successor Agency Meeting, were approved.

Recommended Action
Staff recommends that the Redevelopment Successor Agency approve the minutes of the December 9, 2025 meeting.

MINUTES 4.I. City Council - Regular and Special Meeting - Dec 9, 2025 5:30 PM, were approved as corrected.

RATIFICATION OF

HOMELESSNESS

EMERGENCY

PROCLAMATION

4.J. Adoption of Resolution No. 11726 (CCS) Ratifying Homelessness Emergency Proclamation, was adopted.

Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California
Environmental Quality Act (CEQA) Guidelines; and

2. Adopt proposed Resolution No. 11726 (CCS) ratifying the 2025 Proclamation of the City Council of the City of Santa Monica Declaring a Local Emergency on Homelessness.

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Packet Pg. 903 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 6 December 16, 2025

RATIFICATION OF

REGIONAL FIRES

EMERGENCY

PROCLAMATION

4.K. Adoption of Resolution No. 11727 (CCS) Ratifying Regional Fires Emergency Proclamation and Supplements, was adopted.

Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Sections 15061(b)(3) (Common Sense Exemption). 15268 (Ministerial Projects), and 15301 (Existing Facilities) of the California Environmental Quality Act (CEQA) Guidelines; and

2. Adopt proposed Resolution No. 11727 (CCS) ratifying the Executive Order issued by the Director of Emergency Services declaring the existence of a local emergency in the City of Santa Monica and the Supplements to that Order.

ADJOURNMENT OF

SPECIAL MEETING
The joint meeting with the Redevelopment Successor Agency meeting adjourned at 6:00 p.m.

CLOSED SESSIONS On order of the Mayor, the City Council recessed at 6:02 p.m., to consider Closed Sessions 5.A.–5.E. and 5.J. and returned at 7:39 p.m., with all members present to report the following:

5.A. Conference with legal counsel - existing litigation - Gov. Code § 54956.9(d)(1) John U.N.B. Doe, et al. v. City, et al.; LASC # 23STCV12746; John Doe 1, et al. v. City, et al.; LASC # 23STCV15009; Hector Orozco v. John Doe: Does 1-2; LASC # 23SMCV03120; John JPC Doe v. Doe City, et al.; LASC # 23STCV22020; John AD Doe, et al. v. City, et al.; LASC # 23STCV26548; John CW Doe, et al. v. City, et al.; LASC # 23STCV29623; John Doe (A.G.) v. Santa Monica Police Activities League, et al; LASC # 23SMCV06066; John GA DOE, et al. v. City, et al.; LASC # 24STCV06484; John U.L.W. Doe, et al. v. City, et al.; LASC # 24STCV06768; Joseph Garcia v. Santa Monica Police Activities League, et al.; LASC # 24SMCV01368; John Doe 15, et al. v.

City, et al.; LASC # 24STCV07647; John Doe 18, et al. v. City, et al.; LASC # 24STCV0239; John RR Doe, et al. v. City, et al.; LASC # 24STCV09398; John Doe 33, et al. v. City, et al.; LASC # 24STCV15580; John Doe 48 v. City, et al.; LASC # 24STCV15420; John Doe 49 v. City, et al.; LASC # 24STCV19296; John DD Doe v. City, et al.; LASC # 24SMCV04421; Jane EB Doe, et al. v. City, et al.; LASC # 24STCV24146; John Doe (V.D.) v. Santa Monica Police Activities League, et al.; LASC # 24SMCV05049; John Doe (D.F.) v. Santa Monica Police Activities League, et al.; LASC # 24SMCV05050; John Doe (D.G.) v. Santa Monica Police Activities League, et al.; LASC # 24SMCV05051; Jane Doe 13, et al. v. City, et al.; LASC # 24STCV27233; John AM Doe, et al. v. City, et al.; LASC # 24STCV28433; John Doe v. City, et al.; LASC # 24SMCV05527; John Doe 53 v. City, et al.; LASC #

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Packet Pg. 904 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 7 December 16, 2025
24STCV31763; John Doe (Y.M.) v. Santa Monica Police Activities League, et al.; LASC # 24SMCV06355; Jane Doe 16, et al. v. a Public Entity, et al.; LASC # 25STCV02235; John Doe 62, et al. v. City, et al.; LASC # 25STCV04414; John Doe 23 v. City, et al.; LASC # 25STCV05850; John Doe (E.B.) v. Santa Monica Police Activities League, et al.; LASC # 25STCV06354; Jane PB Doe, et al. v. City, et al.; LASC # 25STCV06880; John Doe 67 v. City, et al.; LASC # 25STCV10142; John Doe 68 v. City, et al.; LASC # 25STCV12089; John Doe 69, et al. v. City, et al.; LASC # 25STCV14031; John OR Doe, et al. v. City, et al.; LASC # 25STCV16251; John RD Doe, et al. v. City, et al.; LASC # 25STCV24158
The City Attorney advised this matter was heard with no reportable action taken.

5.B. Conference with legal counsel - existing litigation - Gov. Code § 54956.9(d)(1): City v. ICSOP, et al.; OCSC # 30-2022-01261243 The City Attorney advised this matter was heard with no reportable action taken.

5.C. Conference with legal counsel - existing litigation - Gov. Code § 54956.9(d)(1): Narine Sulahian Keshishian v. City; LASC # 24SMCV02912
The City Attorney advised this matter was heard with no reportable action taken.

5.D. Conference with legal counsel - potential initiation of litigation - Gov. Code § 54956.9(d)(4): 1 case (SMF Property Holdings LLC; Santa Monica EV Holdings, LLC; and Waymo LLC)
The City Attorney advised this matter was heard with no reportable action taken.

5.E. Conference with legal counsel – existing litigation - Gov. Code § 54956.9(d)(1): Measure LC Defense et al. v. City of Santa Monica et al., LASC # 25STCP04361
The City Attorney advised this matter was heard with no reportable action taken.

5.J. Consider appointment of unrepresented employee - Gov. Code § 54957(b); City negotiator: Mayor/City Manager; Unrepresented employee: City Clerk/Interim City Clerk; conference with labor negotiator - Gov. Code § 54957.6; City negotiator: Mayor/City

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Packet Pg. 905 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 8 December 16, 2025
Manager; Unrepresented employee: City Clerk/Interim City Clerk The City Attorney advised this matter was heard with no reportable action taken.

CITY MANAGER
REPORT
The City Manager Report was presented.

COUNCIL TRAVEL No Councilmembers gave travel reports pursuant to State law.

PUBLIC INPUT ON

REMAINING AGENDA
ITEMS:

Members of the public Jerry Rubin, Brad Ewing, Sam Shapiro-Kline, Gabrielle Ipale, Dennis Zane, Ali Bilal, Justin Nelson, Berta Negari, Nancy Daniels, David Rindlaub and Jacob Wasserman commented on item 10.A.

Member of the public Hunter Hall commented on items 10.A. and 11.A.

Members of the public Steve Wever, Jim Harris, and John Prindle commented on item 11.A.

Member of the public Harvey Eder commented on various local issues.

STAFF

ADMINISTRATIVE
ITEMS:

UPCOMING MAJOR
EVENTS

11.A. Approval of Negotiations for Upcoming Major Events, was presented.

Recommended Action
Staff recommend that the City Council:

1. Make findings that approval of an exclusive negotiating agreement (ENA), letter of intent (LOI), or a term sheet for real estate negotiation purposes do not constitute an approval of a project requiring CEQA review because they do not commit the City to any specific terms of a project; and that the City’s actions contemplated in this report constitute planning and feasibility studies which are exempt from CEQA pursuant to CEQA Guidelines Section 15262.

2. Authorize the City Manager to execute a Letter of Intent (LOI) term sheet and negotiate and execute License Agreement No. 11789 (CCS) subject to CEQA compliance, with the French National Olympic and Sport Committee to host a hospitality house activation at the Annenberg Community Beach House during the 2028 Summer Olympic Games.

3. Authorize the City Manager to execute a term sheet (Term Sheet) and negotiate the terms of License Agreement No. 11790 (CCS) subject to CEQA compliance with LOIDL LLC dba Hochsitz to host a Nations Village to include International Olympic Committee (IOC) satellite broadcast center, National Olympic Committee hospitality house, and brand hospitality house activation at Crescent Bay Park and portions of Lot 4 South during the LA28 Summer Olympic Games.

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Packet Pg. 906 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 9 December 16, 2025

4. Authorize the City Manager to execute Exclusive Negotiation Agreement (ENA) No. 11791 (CCS) and negotiate the terms of a license agreement subject to CEQA compliance with ESPN Productions Inc. to explore a multi-day fan festival experience and international broadcast studio in conjunction with a major sporting event at SoFi Stadium in winter 2027.

5. Award RFP#462 to Goldenvoice LLC, to assess the viability of developing a music festival event on Santa Monica Beach in the fall of 2026 and authorize the City Manager to enter into Exclusive Negotiation Agreement No. 11792 (CCS)and negotiate the terms of a license agreement subject to CEQA compliance.

6. Authorize the City Manager to execute Exclusive Negotiation Agreement (ENA) No. 11793 (CCS) and negotiate the terms of a license agreement subject to CEQA compliance with Anheuser-Busch to explore a World Cup fan festival experience at the Santa Monica Pier in June 2026.

Questions asked and answered of staff included but was not limited to: the various length of terms for the Exclusive Negotiation Agreements (ENA) and if they provide sufficient time for execution; how existing vendors and tenants with empty commercial spaces will be incorporated in events; how the unified pricing methodology will ensure full compensation; the sustainability of managing large scale events by an inter-departmental working group; and examples of potential legacy benefits such as infrastructure improvements.

The Council expressed an interest in: electronic dance music as the theme and genre for the music festival; final license agreements to clarify and define legacy investments; prioritizing local businesses, workers and vendors to the extent feasible; and making events free or low-cost to ensure accessibility to all. The Council also requested that staff follow up on the communications toolkit for LA28 to help prepare the community, and measure and quantify economic impacts such as consumer spending, hotel bookings and local job creation.

Motion by Councilmember Raskin, seconded by Councilmember Zernitskaya to adopt the staff recommendation with direction on an electronic dance music festival. The motion was approved by the following roll call vote:

AYES: Councilmembers Zernitskaya, Snell, Raskin, Hall, Negrete, Mayor Pro Tem Zwick, Mayor Torosis
NOES: None
ABSENT: None

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Packet Pg. 907 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 10 December 16, 2025
PUBLIC HEARINGS:

SELF-CERTIFICATION

PILOT PROGRAM

12.A. Approval of Establishment of a Self-Certification Pilot Program and Introduction and First Reading of Ordinances to (1) Amend Santa Monica Municipal Code Chapter 8.108 to revise the Construction and Demolition Material Recycling Compliance Process and to transition from a deposit-based system to a fine-based enforcement approach, and (2) Establish Interim Zoning Regulations Updating Applicability Thresholds and Standards for Resource and Recycling Room Dimensions; and Adopt a Resolution of Intention to Amend the Text Section 9.21.130 of the Zoning Ordinance Related to Resource Recovery and Recycling Standards, was presented.

Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of Statutory Exemption from the California Environmental Quality Act (CEQA) pursuant to Government Code Section 15061(b)(3).2.

2. Introduce for First Reading an Ordinance amending Santa Monica Municipal Code Chapter 8.108, Subpart B, to amend the construction and demolition material recycling compliance process and to transition from a deposit-based system to a fine-based enforcement approach.

3. Introduce for First Reading an Interim Zoning Ordinance updating applicability thresholds and standards for resource and recycling room dimensions set forth in Santa Monica Municipal Code Section 9.21.130 in order to further economic recovery efforts by facilitating a selfcertification building permit program.

4. Adopt a Resolution of Intention 11728 (CCS) directing the Planning Commission to initiate amendments to the text of Section 9.21.130 of the City’s Zoning Ordinance to update applicability thresholds and resource and recycling room dimensions in order to further economic recovery efforts by facilitating a self-certification building permit program.

Members of the public Mati Fuchs-Lynch, Brad Ewing, Sam Shapiro-Kline, and Todd Lynch spoke to the recommended action.

Questions asked and answered of staff included but was not limited to: which licensed professional is the project lead submitting on behalf of the business; why Certified Access Specialist (CASp) approval was recommended; if requiring additional liability insurance is standard in other jurisdictions; accommodations or exceptions for restaurants required to comply with new State laws such as upgrading trash enclosures; if there is a distinction for safety requirements between restaurant and bars/clubs; confirmation that strikes are violations that applicants have control over and how warnings are communicated after two strikes; the percentage of applicants who meet the pre-qualification requirements, clarification on the scope of similar projects within the City and why the 15 year time period was recommended; the differences between the degrees of occupancy hazards, what places a project

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Packet Pg. 908 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 11 December 16, 2025
(Mayor Torosis left the dais
at 9:43 p.m.)
(Mayor Torosis returned the
dais at 9:45 p.m.)
in a higher degree, and if change of uses are allowed; success indicators of the program; and potential conflicts for board members such as the Architectural Review Board who may be involved in projects. The Council expressed concerns over applicants and restaurants meeting requirements as currently proposed.

Motion by Mayor Pro Tem Zwick, seconded by Councilmember Negrete, to adopt the staff recommendation with direction to allow for self-certification of building codes for restaurant tenant improvements (TI), and revise prequalification requirements from three to two projects of similar scope or greater.

Motion to amend by Councilmember Zernitskaya to include direction to implement phases 2 and 3 no later than 6 months after the prior phase; implement Option 1 in terms of removing leads from the Qualified List; and provide Council with updates of each phase. The amendment was friendly to the maker and seconder. The amended motion was approved by the following roll call vote:

AYES: Councilmembers Negrete, Hall, Raksin, Snell, Zernitskaya, Mayor Pro Tem Zwick, Mayor Torosis
NOES: None
ABSENT: None
ORDINANCES:
(Councilmember Raskin left
the dais at 9:47 p.m.)

10.A. Introduction and First Reading of an Ordinance to Establish a Digital Display District to Permit Digital Displays to Be Approved by Development Agreement in Specified Locations Along the Third Street Promenade and Santa Monica Place, was presented along with a revised proposed ordinance.

Recommended Action
Staff recommends that the City Council take the following actions:

1. Adopt findings of categorical exemptions pursuant to Sections 15301, 15303, 15311, 15331, and 15332 of the California Environmental Quality Act (CEQA) Guidelines as described in Environmental Review, below; and

2. Introduce for First Reading an Ordinance to establish a digital display district to permit digital displays to be approved by Development Agreement in specified locations along the Third Street Promenade and Santa Monica Place.

3. Adopt Digital Display Advertising Guidelines.

Questions asked and answered of staff included but was not limited to: the process of auditing public benefits and revenue; transition of the displays’ brightness and control mechanisms to adjustment brightness depending on ambient light; the process of reviewing violations, the penalties imposed and

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Packet Pg. 909 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 12 December 16, 2025
the confirmation of the responsible party; the ability to change number of potential locations in the future; if 1,000 square feet is standard and why it was recommended; the difference between scrolling and animated text; if displays have sound capabilities; average costs of installation and operation of displays; if offering lower advertising rates to potential Promenade tenants were considered; why the projects were not reviewed by the Architectural Review Board or Landmarks Commission since six locations are landmarks; if other jurisdictions approved Development Agreements (DA) with shorter terms; why reviewing 16 locations was recommended instead of rolling them out in batches; if the City’s 20% of total annual operating time is reverted to private advertising if some of the time is not fully utilized; and if all displays have the capability of coordinating with one another for art installations or immersive experiences.

The Council expressed: concerns about not utilizing the allotted 20% of community time, and interest in dedicating resources to hire City staff or a third-party contractor to manage the allocation of screentime.

Motion by Councilmember Hall, seconded by Mayor Pro Tem Zwick, to introduce and hold first reading of the revised ordinance reading by title only and waiving further reading thereof, with the following direction to spend the first $5M to fund the approved Re-Alignment Plan, and on-going revenue above the first $5M to be divided to fund the Housing Trust Fund, revitalization efforts for downtown and businesses, and a new moving image media art program at the discretion of the City. To the extent possible, the division may be: 10% to repay Housing Trust Fund until paid; 85% for the revitalization efforts and business infrastructure and up to 5% for the creation and maintenance of an art program. Examples of revitalization funding may be tenant improvements, development of the Promenade 3.0 Plan, or 0% interest public loans for conversion of retail to businesses including but not limited to restaurants, bars or clubs.

Discussion ensued on topics including, but was not limited to: better lighting that would assist with public safety; concerns with the changing look of The Promenade, amount of signs, the long term of the DAs, and maintenance of displays; the process of rolling out the displays; and communicating how community benefits and funds are invested back to downtown and the revitalization efforts. The motion was approved by the following roll call vote:

AYES: Councilmembers Zernitskaya, Snell, Hall, Negrete, Mayor Pro Tem Zwick, Mayor Torosis
NOES: None
ABSENT: Councilmember Raskin

4.N
Packet Pg. 910 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 13 December 16, 2025
1202 THIRD STREET

PROMENADE DIGITAL

DISPLAY

12.B. Introduction and First Reading of an Ordinance to Approve a Development Agreement for a Digital Display Located at 1202 Third Street Promenade, was presented by staff and the City Manager read the Historic Findings into the record.

Recommended Action
Staff recommends that the City Council:

1. Adopt findings of categorical exemptions pursuant to Sections 15301, 15303, 15311, 15331, and 15332 of the California Environmental Quality Act (CEQA) Guidelines;

2. Introduce an ordinance for first reading to approve Development Agreement 25ENT-0021 for a Digital Display at 1202 3rd Street Promenade.

No members of the public spoke on the recommended action.

Questions asked and answered of staff included the City’s options to cancel a Development Agreement (DA) for breach of content guidelines, maintenance standards or occupancy requirements, and the effectiveness of the enforcement tools in the DA.

Motion by Councilmember Zernitskaya, seconded by Councilmember Hall, to adopt the staff recommendation with the amendments to the presentation.

The motion was approved by the following roll call vote:

AYES: Councilmembers Negrete, Hall, Snell, Zernitskaya, Mayor Pro Tem Zwick, Mayor Torosis
NOES: None
ABSENT: Councilmember Raskin
301 ARIZONA
AVENUE/1253 THIRD

STREET PROMENADE

DIGITAL DISPLAY

12.C. Introduction and First Reading of an Ordinance to Approve a Development Agreement for a Digital Display Located at 301 Arizona Avenue/1253 Third Street Promenade, was presented by staff and the Council waived the presentation from the applicant.

Recommended Action
Staff recommends that the City Council:

1. Adopt findings of categorical exemptions pursuant to Section 15301, 15303, Section 15311, and Section 15332 of the California Environmental Quality Act (CEQA) Guidelines; and

2. Introduce for first reading an ordinance to approve Development Agreement 24ENT-0233 for a Digital Display at 301 Arizona Avenue/1253 3rd Street Promenade.

No members of the public spoke on the recommended action.

4.N
Packet Pg. 911 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 14 December 16, 2025
Questions asked and answered of staff included if the ordinance allows applicants to install a second display, breakup the current display into two or split screens.

Motion by Councilmember Zernitskaya, seconded by Councilmember Snell, to adopt the staff recommendation with the amendments in the presentation.

The motion was approved by the following roll call vote:

AYES: Councilmembers Zernitskaya, Snell, Hall, Negrete, Mayor Pro Tem Zwick, Mayor Torosis
NOES: None
ABSENT: Councilmember Raskin
1310 THIRD STREET

PROMENADE DIGITAL

DISPLAY

12.D. Introduction and First Reading of an Ordinance to Approve a Development Agreement for a Digital Display Located at 1310 Third Street Promenade Development Agreement, was presented by staff and Council waived the presentation from the applicant.

Recommended Action
Staff recommends that the City Council:

1. Adopt findings of categorical exemptions pursuant to Sections 15301, 15303, 15311, and 15332 of the California Environmental Quality Act (CEQA) Guidelines; and

2. Introduce an ordinance for first reading to approve Development Agreement 25ENT-0086 substantially in the form attached hereto for a Digital Display at 1310 3rd Street Promenade
No members of the public spoke on the recommended action.

Questions asked and answered of staff included the direction of light towards the Victoria Secrets building; clarification on the standards of the lighting study and effects; and confirmation of the receiver and if they are amenable to the Development Agreement. A brief discussion ensued on the design and context-sensitivity of the display.

Motion by Councilmember Hall, seconded by Mayor Pro Tem Zwick, to adopt the staff recommendation. The motion was approved by the following roll call vote:

AYES: Councilmembers Negrete, Hall, Zernitskaya, Mayor Pro Tem Zwick
NOES: Councilmember Snell, Mayor Torosis
ABSENT: Councilmember Raskin

4.N
Packet Pg. 912 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 15 December 16, 2025
395 SANTA MONICA

PLACE DIGITAL

DISPLAY

12.E. Introduction and First Reading of an Ordinance to Approve a Development Agreement for a Digital Display Located at 395 Santa Monica Place, was presented by staff with a correction to the owner’s name listed in the ordinance and addition to the project plans for the display by the Tesla storefront that the minimum clearance is 11½ feet above the sidewalk.

Council waived the presentation from the applicant.

Recommended Action
Staff recommends that the City Council

1. Adopt findings of categorical exemptions pursuant to Sections 15301, 15303, 15311, and 15332 of the California Environmental Quality Act (CEQA) Guidelines;

2. Introduce an ordinance for first reading to approve Development Agreement 24ENT-0024 for four Digital Displays at 395 Santa Monica Place.

3. Approve a license agreement 11794 (CCS) with Trigild IVL, CourtAppointed Receiver for the Santa Monica Place property, for installation and operation of a digital display on Parking Structure No. 7.

No member of the public spoke on the recommended action.

Questions asked and answered of staff included but was not limited to:
building occupancy requirements for retail space with multiple floors; addressing the concerns of office tenants by the 4
th/ Broadway display; and
the current occupancy of Santa Monica Place and when the occupancy thresholds go into effect.

Motion by Councilmember Zernitskaya, seconded by Councilmember Snell, to adopt the staff recommendation with the correction and addition made in the presentation. The motion was approved by the following roll call vote:

AYES: Councilmembers Zernitskaya, Snell, Hall, Negrete, Mayor Pro Tem Zwick, Mayor Torosis
NOES: None
ABSENT: Councilmember Raskin

COUNCILMEMBER
DISCUSSION ITEMS:
(Councilmember Raskin
returned to the dais at 11:42
p.m.)
In accordance with Council Rule 6(y), all Councilmember Discussion items were considered and approved in one motion unless removed by a Councilmember for discussion.

Motion by Councilmember Hall, seconded by Councilmember Negrete to continue items 16.A.-16.B. and approve items 16.C.-16.E. The motion was approved by the following roll call vote:

4.N
Packet Pg. 913 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 16 December 16, 2025
AYES: Councilmembers Negrete, Hall, Raskin, Snell, Zernitskaya, Mayor Pro Tem Zwick, Mayor Torosis
NOES: None
ABSENT: None

TRANSIENT

OCCUPANCY TAX

ADVISORY COMMITTEE

16.A. Appointment to one scheduled vacancy on the Transient Occupancy Tax Advisory Committee for a term ending on June 30, 2027 (Continued from 11/18/2025 and 12/09/2025), was continued.

DISABILITIES

COMMISSION

16.B. Appointment to one unscheduled vacancy on the Disabilities Commission for a term ending on June 30, 2029, was continued.

CITYWIDE

REALIGNMENT

PERFORMANCE

FRAMEWORK

16.C. Request of Mayor Torosis, Councilmember Hall, and Councilmember Raskin that the City Council direct the City Manager, in coordination with the City Attorney to establish a Citywide Realignment Performance Framework and public-facing dashboard that organizes outcome and output performance indicators across the Realignment Plan’s five priority areas, was approved.

SANTA MONICA CEO

ROUNDTABLE

16.D. Request of Mayor Torosis and Mayor Pro Tem Zwick that the City Council direct the City Manager to return within 30 days with a detailed framework for establishing the Santa Monica CEO Roundtable, was approved.

FORMAL

PERFORMANCE

EVALUATION PROCESS

16.E. Request of Mayor Torosis, Mayor Pro Tempore Zwick, and Councilmember Hall that Council establish a formal performance evaluation process for the City Manager, City Attorney, and City Clerk, was approved.

AD HOC COMMITTEE 16.F. Establish and appoint a temporary ad hoc Council committee for the City Clerk recruitment process, was presented.

Councilmember Zernitskaya nominated herself, Councilmember Hall and Mayor Torosis. There being no other nominations, the motion was seconded by Councilmember Hall and the motion was approved by the following roll call vote:

AYES: Councilmembers Zernitskaya, Snell, Raskin, Hall, Negrete, Mayor Pro Tem Zwick, Mayor Torosis
NOES: None
ABSENT: None

CLOSED SESSIONS
(CONTINUED)
(Mayor Pro Tem Zwick left at
Mayor Pro Tem Zwick announced that he will recuse himself from items

5.F.–5.I. due to a conflict of interest.

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Packet Pg. 914 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 17 December 16, 2025
11:44 p.m.) On order of the Mayor, the City Council recessed from the public session at 11:44 p.m. to consider Closed Sessions and reported the following:

5.F. Conference with legal counsel – existing litigation - Gov. Code § 54956.9(d)(1): La Brea Washington Co, LLC v. City of Santa Monica, LASC # 25STCP00154
The City Attorney advised this matter was heard with no reportable action taken.

5.G. Conference with real estate negotiator - Gov. Code § 54956.8:
property: 1217 Euclid Street, Santa Monica, CA; owner of record/lessor: City of Santa Monica; City negotiators: Natalie Verlinich, Interim Director of Housing and Human Services; parties to be negotiated with: Sarah Letts, Executive Director, Hollywood Community Housing Corporation (HCHC); under negotiation: price and terms of payment for ground lease of property
The City Attorney advised this matter was heard with no reportable action taken.

5.H. Conference with legal counsel - existing litigation - Gov. Code § 54956.9(d)(1): Stanford Neighbors Against City Overreach v. City of Santa Monica, LASC # 25STCP04108
The City Attorney advised this matter was heard with no reportable action taken.

5.I. Conference with legal counsel - significant exposure to litigation - Gov. Code § 54956.9(d)(2) - 1 case
The City Attorney advised this matter was heard with no reportable action taken.

ADJOURNMENT On order of the Mayor, the City Council adjourned from Closed Session at 12:22 a.m. in memory of Rob and Michele Reiner and Jubilant Sykes.

ATTEST: APPROVED:

Maria Dacanay-Wisner Caroline Torosis
Assistant City Clerk Mayor

4.N
Packet Pg. 915 Minutes Acceptance: Minutes of Dec 16, 2025 5:30 PM (CONSENT CALENDAR) 1 January 6, 2026
(NOT APPROVED)

CITY OF SANTA MONICA

CITY COUNCIL MINUTES
JANUARY 6, 2026
A special meeting of the Santa Monica City Council was called to order by Mayor Torosis at 5:30 p.m., on Tuesday, January 6, 2026, at City Council Chambers, 1685 Main Street, Santa Monica, CA.

Roll Call: Present: Mayor Caroline Torosis
Councilmember Lana Negrete
Councilmember Dan Hall
Councilmember Ellis Raskin
Councilmember Barry Snell
Councilmember Natalya Zernitskaya

Absent: Mayor Pro Tem Jesse Zwick
Also Present: City Manager Oliver Chi
Interim City Attorney Heidi von Tongeln
Assistant City Clerk Maria Dacanay-Wisner
CONVENE/PLEDGE On order of the Mayor, the City Council convened at 5:30 p.m., with Mayor Pro Tem Zwick absent. Councilmember Zernitskaya led the assemblage in the Pledge of Allegiance.

STATEMENT OF

ACCOUNTABILITY
(LAND

ACKNOWLEDGEMENT)
The City of Santa Monica Statement of Accountability (Land Acknowledgement) was read into the record by Councilmember Negrete.

LEVINE ACT

DISCLOSURE
No Councilmembers made disclosures regarding the Levine Act (Govt Code Section 84308).

PUBLIC INPUT FOR
CLOSED SESSION ONLY:

No members of the public commented on the Closed Session item.

CLOSED SESSIONS On order of the Mayor, the City Council recessed at 5:32 p.m., to consider Closed Sessions and returned at 7:15 p.m., with Mayor Pro Tem Zwick absent, to report the following:

5.A. Consider appointment of unrepresented employee – Gov. Code § 54957(b); City negotiator: Mayor/City Manager; Unrepresented employee: City Clerk/Interim City Clerk; conference with labor

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Packet Pg. 916 Minutes Acceptance: Minutes of Jan 6, 2026 5:30 PM (CONSENT CALENDAR) 2 January 6, 2026
negotiator - Gov. Code § 54957.6; City negotiator: Mayor/City Manager; Unrepresented employee: City Clerk/Interim City Clerk The City Attorney advised this matter was heard, a candidate was selected and the City Manager will extend an offer.

ADJOURNMENT On order of the Mayor, the City Council meeting adjourned at 7:16 p.m.

ATTEST: APPROVED:

Maria Dacanay-Wisner Caroline Torosis
Assistant City Clerk Mayor

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Packet Pg. 917 Minutes Acceptance: Minutes of Jan 6, 2026 5:30 PM (CONSENT CALENDAR) City Council
Report
City Council Meeting: January 13, 2026
Agenda Item: 4.P
1 of 2
To: Mayor and City Council
From: Dana Brown, Human Resources Director, Human Resources Department Subject: Approval of Offer Letter for Retired Annuitant Denise Anderson-Warren for Services as Interim Director of Records and Election Services (City Clerk) Recommended Action
Staff recommends that the City Council:

1. Adopt a finding of no possibility of significant effect pursuant to Section 15601(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines;

2. Approve the offer letter to Denise Anderson-Warren for her services as Interim Director of Records and Election Services (“City Clerk”); and

3. Authorize the Mayor to sign the offer letter on behalf of the City.

Summary
On January 6, 2026, the City Council appointed Denise Anderson-Warren to serve as Interim City Clerk upon the departure of former City Clerk Nikima Newsome and continuing until the completion of a recruitment and selection process for a permanent City Clerk. Ms. Anderson-Warren retired in 2023 from the position of City Clerk and is therefore uniquely qualified to assume the role immediately with no need for additional training.

As a retired annuitant, Ms. Anderson-Warren’s appointment is subject to the requirements of Government Code Section 21221(h). In accordance with these requirements, under the terms of the offer letter, Ms. Anderson-Warren’s hourly rate will be $119.13 (which equates to an annual salary of $247,788); her services will be for a limited duration to commence on January 15, 2026, until a permanent appointment is

4.P
Packet Pg. 918
2 of 2
made; and she will receive no additional benefits. Because she will be serving as a “local agency executive” as defined in Government Code section 3511.1(d), California law requires that Ms. Anderson-Warren’s pay be approved at a regular meeting, with an oral summary provided before final action is taken. See Government Code sections 54953(c)(3), 54956(b).

Environmental Review
The offer letter for Ms. Anderson-Warren’s services as a retired annuitant is exempt from CEQA pursuant to Section 15061(b)(3) of the CEQA Guidelines, which states that CEQA does not apply, “where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment.” The offer letter is administrative in nature. Therefore, it can be seen with certainty that the offer letter would not result in adverse physical impacts on the environment, and as such, is exempt from CEQA.

Financial Impacts and Budget Actions
There is no immediate financial impact or budget action necessary as a result of the recommended action. Salary for retired annuitants appointed for a limited duration is included in the FY 2025-26 budget.

Prepared By: Dana Brown, Human Resources Director
Approved Forwarded to Council
Attachments:

A. Denise Anderson Warren Interim City Clerk Job Offer Letter

4.P
Packet Pg. 919
January 13, 2026
Denise Anderson-Warren
3200 W 79th Street
Inglewood, CA 90305
Re: Offer of Temporary Appointment – Limited Duration
Dear Denise:

It is my pleasure to extend this offer of Interim Director of Records and Election Services (City Clerk) while the City is recruiting for a permanent appointment.

The specific terms of your appointment are as follows:
• Your start date is Thursday, January 15, 2026, and will continue until the completion of the recruitment for a permanent Director of Records and Election Services (City Clerk).
• Your rate of pay is $119.13 per hour.
• You have specialized skills and certifications required for the position of Director of Records and Election Services (City Clerk)
• You are not entitled to receive any additional benefits, incentives, compensation in lieu of benefits, or other forms of compensation. • As a temporary, as-needed employee, your employment status is at will and may end with or without cause or advance notice at any time. • As a CalPERS retired annuitant, your hours of work may not exceed 960 hours in a fiscal year (July 1st through June 30th) for all combined CalPERS employers by whom you are employed.

This offer of employment is made with the City’s understanding and belief that it complies with State law governing employment of CalPERS retirees. However, the City cannot guarantee that CalPERS may otherwise determine in the future that your employment is not consistent with limitations on post-retirement employment. Therefore, your acceptance of this offer of employment is done so at your own risk. If CalPERS finds that your post-retirement employment with the City violates restrictions on employment of retirees, the City will not be responsible for, and you agree to waive any and all claims against the City for, any loss or damage occasioned by you because of any such findings. Please review A Guide to CalPERS Employment After Retirement (Pub 33) to ensure you understand the rules for working after retirement.

If you accept this offer of temporary, part-time employment, please sign below and return this letter to my attention.

If you have any questions regarding this matter, please do not hesitate to contact Human Resources Director Dana Brown at (310) 458-8940 or [email protected].

Sincerely,

4.P.a
Packet Pg. 920 Attachment: Denise Anderson Warren Interim City Clerk Job Offer Letter (7486 : Interim City Clerk) Caroline Torosis
Mayor
Acknowledgement and Waiver:
“I, Denise Anderson-Warren, acknowledge receipt of this Offer of Temporary, Part-Time Employment – Limited Duration. I understand this employment is to perform work of a limited duration and subject to CalPERs’ rules for working after retirement. I have reviewed A Guide to CalPERs Employment After Retirement (Pub 33) and am aware of the rules for post- retirement employment and the consequences for failure to comply. I confirm that I meet the prerequisites for a retired annuitant appointment with the City of Santa Monica. I agree that if CalPERS finds my employment with the City violates CalPERS’ restrictions on employment after retirement, the City will not be responsible for, and I agree to waive any and all claims against the City for, any loss or damage I incur because of any such finding.
_______________________________________ ______________________ Signature Date
cc: Human Resources

4.P.a
Packet Pg. 921 Attachment: Denise Anderson Warren Interim City Clerk Job Offer Letter (7486 : Interim City Clerk) City Council
Report
City Council Meeting: January 13, 2026
Agenda Item: 5.A
1 of 2
To: Mayor and City Council
From: Heidi Von Tongeln, Interim City Attorney, City Attorney's Office, Administration
Subject: Conference with legal counsel - existing litigation - Gov. Code § 54956.9(d)(1): John U.N.B. Doe, et al. v. City, et al.; LASC # 23STCV12746; John Doe 1, et al. v. City, et al.; LASC # 23STCV15009; Hector Orozco v.

John Doe: Does 1-2; LASC # 23SMCV03120; John JPC Doe v. Doe City, et al.; LASC # 23STCV22020; John AD Doe, et al. v. City, et al.; LASC # 23STCV26548; John CW Doe, et al. v. City, et al.; LASC # 23STCV29623; John Doe (A.G.) v. Santa Monica Police Activities League, et al; LASC # 23SMCV06066; John GA DOE, et al. v. City, et al.; LASC # 24STCV06484; John U.L.W. Doe, et al. v. City, et al.; LASC # 24STCV06768; Joseph Garcia v. Santa Monica Police Activities League, et al.; LASC # 24SMCV01368; John Doe 15, et al. v. City, et al.; LASC # 24STCV07647; John Doe 18, et al. v. City, et al.; LASC # 24STCV0239; John RR Doe, et al. v. City, et al.; LASC # 24STCV09398; John Doe 33, et al. v. City, et al.; LASC # 24STCV15580; John Doe 48 v. City, et al.; LASC # 24STCV15420; John Doe 49 v. City, et al.; LASC # 24STCV19296; John DD Doe v. City, et al.; LASC # 24SMCV04421; Jane EB Doe, et al. v. City, et al.; LASC # 24STCV24146; John Doe (V.D.) v. Santa Monica Police Activities League, et al.; LASC # 24SMCV05049; John Doe (D.F.) v. Santa Monica Police Activities League, et al.; LASC # 24SMCV05050; John Doe (D.G.) v. Santa Monica Police Activities League, et al.; LASC # 24SMCV05051; Jane Doe 13, et al. v. City, et al.; LASC # 24STCV27233; John AM Doe, et al. v. City, et al.; LASC # 24STCV28433; John Doe v. City, et al.; LASC # 24SMCV05527; John Doe 53 v. City, et al.; LASC # 24STCV31763; John Doe (Y.M.) v. Santa Monica Police Activities League, et al.; LASC # 24SMCV06355; Jane Doe 16, et al. v. a Public Entity, et al.; LASC # 25STCV02235; John Doe 62, et al. v. City, et al.; LASC # 25STCV04414; John Doe 23 v. City, et al.; LASC # 25STCV05850; John Doe (E.B.) v. Santa Monica Police Activities League, et al.; LASC # 25STCV06354; Jane PB Doe, et al. v. City, et al.; LASC # 25

5.A
Packet Pg. 922
2 of 2
Prepared By: Bradley Michaud, Legal Administrative Services Officer Approved Forwarded to Council

5.A
Packet Pg. 923
City Council
Report
City Council Meeting: January 13, 2026
Agenda Item: 5.C
1 of 1
To: Mayor and City Council
From: Heidi Von Tongeln, Interim City Attorney, City Attorney's Office Subject: Conference with legal counsel - existing litigation - Gov. Code § 54956.9(d)(1): City of Santa Monica, et al. v. Waymo LLC et al., LASC # 25SMCV06581
Prepared By: Bradley Michaud, Legal Administrative Services Officer Approved Forwarded to Council
Attachments:

A. Written Comments

5.C
Packet Pg. 924
1 David Yakobson
From: Tom Larmore <[email protected]>
Sent: Tuesday, January 13, 2026 11:56 AM
To: Lana Negrete; Caroline Torosis; Jesse Zwick; Dan Hall; Ellis Raskin; Barry Snell; Natalya Zernitskaya
Cc: Oliver Chi; councilmtgitems; Nikima Newsome; Heidi von Tongeln Subject: City Council Agenda Item Nos. 5A, 5B and 5C
Attachments: CC 2026-01-13.pdf

EXTERNAL
Please see the attached.

Thomas R. Larmore | Attorney at Law
1250 Sixth Street, Suite 200 | Santa Monica, CA 90401
O: (310) 260-3315 | [email protected]
Item 5-C
January 13, 2026
Item 5-C
January 13, 2026

5.C.a
Packet Pg. 925 Attachment: Written Comments (7497 : 5.C. Closed Session - Waymo) Item 5-C
January 13, 2026
Item 5-C
January 13, 2026

5.C.a
Packet Pg. 926 Attachment: Written Comments (7497 : 5.C. Closed Session - Waymo) Item 5-C
January 13, 2026
Item 5-C
January 13, 2026

5.C.a
Packet Pg. 927 Attachment: Written Comments (7497 : 5.C. Closed Session - Waymo) Item 5-C
January 13, 2026
Item 5-C
January 13, 2026

5.C.a
Packet Pg. 928 Attachment: Written Comments (7497 : 5.C. Closed Session - Waymo) 1 David Yakobson
From: Santa Monica City Manager's Office
Sent: Monday, January 12, 2026 6:20 PM
To: councilmtgitems
Subject: FW: Letter from SMRR regarding Waymo
Attachments: FINAL SMRR Waymo letter.pdf
From: SM Renters Rights <[email protected]>
Sent: Wednesday, January 7, 2026 6:05 PM
To: Caroline Torosis <[email protected]>; Ellis Raskin <[email protected]>; Dan Hall <[email protected]>; Barry Snell <[email protected]>; Natalya Zernitskaya <[email protected]>; Lana Negrete <[email protected]>; Jesse Zwick <[email protected]>; Attorney Mailbox <[email protected]>; Santa Monica City Manager's Office <[email protected]>
Subject: Letter from SMRR regarding Waymo

EXTERNAL
Dear Mayor and City Councilmembers,
Please find the attached letter from SMRR regarding Waymo.

Thank you
Item 5-C
January 13, 2026
Item 5-C
January 13, 2026

5.C.a
Packet Pg. 929 Attachment: Written Comments (7497 : 5.C. Closed Session - Waymo) January 7, 2026
Mayor Torosis and City Councilmembers
City of Santa Monica
1685 Main Street
Santa Monica, CA 90401
Dear Mayor Torosis and City Councilmembers:

Santa Monicans for Renters’ Rights (SMRR) believes that a core aspect of renters’ rights (and, indeed, of all residents’ rights) is the right to the peaceful enjoyment of their homes. SMRR further believes that it is the duty of both the City Council and Staff to vigorously protect that right.

SMRR is deeply disturbed by the disruptions and the burdens imposed on residential neighbors as a result of Waymo’s current operation of the lots located at 1222 and 1310 Broadway as is alleged in the City’s Complaint against Waymo (filed on 12/19/25), and as is detailed in the City’s Motion for Preliminary Injunction and supporting evidentiary materials (filed on 12/24/25). SMRR opposes operations imposing these burdens.

SMRR supports the City taking whatever action it deems appropriate and effective to return peace to the nearby neighborhoods.

SMRR urges the City to be steadfast in its efforts to attach conditions limiting Waymo operations such that peace and tranquility can be returned to the neighborhoods around the Waymo parking and charging sites.

It simply is not acceptable that residents should be forced to endure sleepless nights in their homes.

SMRR further urges City Council and Staff to determine whether, and if so how, the City can improve its permitting process in the future to avoid a repeat of this episode as additional new technologies are deployed in the City.

Sincerely,
Denny Zane Mike Soloff
Co-Chair, Santa Monicans for Renters’ Rights Co-Chair, Santa Monicans for Renters’ Rights cc: Heidi von Tongeln, Interim City Attorney
Oliver Chi, City Manager
Item 5-C
January 13, 2026
Item 5-C
January 13, 2026

5.C.a
Packet Pg. 930 Attachment: Written Comments (7497 : 5.C. Closed Session - Waymo) City Council
Report
City Council Meeting: January 13, 2026
Agenda Item: 5.E
1 of 1
To: Mayor and City Council
From: Heidi Von Tongeln, Interim City Attorney, City Attorney's Office Subject: Conference with legal counsel - existing litigation - Gov. Code § 54956.9(d)(1): Waymo LLC v. City, LASC # 25SMCV06541
Prepared By: Bradley Michaud, Legal Administrative Services Officer Approved Forwarded to Council
Attachments:

A. Written Comments

5.E
Packet Pg. 931
1 David Yakobson
From: Tom Larmore <[email protected]>
Sent: Tuesday, January 13, 2026 11:56 AM
To: Lana Negrete; Caroline Torosis; Jesse Zwick; Dan Hall; Ellis Raskin; Barry Snell; Natalya Zernitskaya
Cc: Oliver Chi; councilmtgitems; Nikima Newsome; Heidi von Tongeln Subject: City Council Agenda Item Nos. 5A, 5B and 5C
Attachments: CC 2026-01-13.pdf

EXTERNAL
Please see the attached.

Thomas R. Larmore | Attorney at Law
1250 Sixth Street, Suite 200 | Santa Monica, CA 90401
O: (310) 260-3315 | [email protected]
Item 5-E
January 13, 2026
Item 5-E
January 13, 2026

5.E.a
Packet Pg. 932 Attachment: Written Comments (7493 : 5.E. Closed Session - Waymo) Item 5-E
January 13, 2026
Item 5-E
January 13, 2026

5.E.a
Packet Pg. 933 Attachment: Written Comments (7493 : 5.E. Closed Session - Waymo) Item 5-E
January 13, 2026
Item 5-E
January 13, 2026

5.E.a
Packet Pg. 934 Attachment: Written Comments (7493 : 5.E. Closed Session - Waymo) Item 5-E
January 13, 2026
Item 5-E
January 13, 2026

5.E.a
Packet Pg. 935 Attachment: Written Comments (7493 : 5.E. Closed Session - Waymo) 1 David Yakobson
From: Santa Monica City Manager's Office
Sent: Monday, January 12, 2026 6:20 PM
To: councilmtgitems
Subject: FW: Letter from SMRR regarding Waymo
Attachments: FINAL SMRR Waymo letter.pdf
From: SM Renters Rights <[email protected]>
Sent: Wednesday, January 7, 2026 6:05 PM
To: Caroline Torosis <[email protected]>; Ellis Raskin <[email protected]>; Dan Hall <[email protected]>; Barry Snell <[email protected]>; Natalya Zernitskaya <[email protected]>; Lana Negrete <[email protected]>; Jesse Zwick <[email protected]>; Attorney Mailbox <[email protected]>; Santa Monica City Manager's Office <[email protected]>
Subject: Letter from SMRR regarding Waymo

EXTERNAL
Dear Mayor and City Councilmembers,
Please find the attached letter from SMRR regarding Waymo.

Thank you
Item 5-E
January 13, 2026
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January 13, 2026

5.E.a
Packet Pg. 936 Attachment: Written Comments (7493 : 5.E. Closed Session - Waymo) January 7, 2026
Mayor Torosis and City Councilmembers
City of Santa Monica
1685 Main Street
Santa Monica, CA 90401
Dear Mayor Torosis and City Councilmembers:

Santa Monicans for Renters’ Rights (SMRR) believes that a core aspect of renters’ rights (and, indeed, of all residents’ rights) is the right to the peaceful enjoyment of their homes. SMRR further believes that it is the duty of both the City Council and Staff to vigorously protect that right.

SMRR is deeply disturbed by the disruptions and the burdens imposed on residential neighbors as a result of Waymo’s current operation of the lots located at 1222 and 1310 Broadway as is alleged in the City’s Complaint against Waymo (filed on 12/19/25), and as is detailed in the City’s Motion for Preliminary Injunction and supporting evidentiary materials (filed on 12/24/25). SMRR opposes operations imposing these burdens.

SMRR supports the City taking whatever action it deems appropriate and effective to return peace to the nearby neighborhoods.

SMRR urges the City to be steadfast in its efforts to attach conditions limiting Waymo operations such that peace and tranquility can be returned to the neighborhoods around the Waymo parking and charging sites.

It simply is not acceptable that residents should be forced to endure sleepless nights in their homes.

SMRR further urges City Council and Staff to determine whether, and if so how, the City can improve its permitting process in the future to avoid a repeat of this episode as additional new technologies are deployed in the City.

Sincerely,
Denny Zane Mike Soloff
Co-Chair, Santa Monicans for Renters’ Rights Co-Chair, Santa Monicans for Renters’ Rights cc: Heidi von Tongeln, Interim City Attorney
Oliver Chi, City Manager
Item 5-E
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5.E.a
Packet Pg. 937 Attachment: Written Comments (7493 : 5.E. Closed Session - Waymo) City Council
Report
City Council Meeting: January 13, 2026
Agenda Item: 5.F
1 of 1
To: Mayor and City Council
From: Heidi Von Tongeln, Interim City Attorney, City Attorney's Office Subject: Conference with real estate negotiator - Gov. Code § 54956.8; property: 930 Pacific Coast Highway, 1200 Pacific Coast Highway, 2400 Ocean Front Walk, and 2600 Ocean Front Walk, Santa Monica, California; City negotiators:

Jennifer Taylor, Economic Development Manager; owner of record: City of Santa Monica; persons to be negotiated with: Richard Chacker, President for Chaos Enterprises, Inc. dba Perry’s Café and Rentals at the Beach; under negotiation: price and terms of lease
Prepared By: Bradley Michaud, Legal Administrative Services Officer Approved Forwarded to Council
Attachments:

A. Written Comments

5.F
Packet Pg. 938
1 David Yakobson
From: Ted Winterer <[email protected]>
Sent: Monday, January 12, 2026 12:10 PM
To: Caroline Torosis; Jesse Zwick; Dan Hall; Lana Negrete; Natalya Zernitskaya; Ellis Raskin; Barry Snell
Cc: Oliver Chi; councilmtgitems
Subject: 1/13/26 closed session agenda, Perry's lease

EXTERNAL
Mayor Torosis and Councilmembers,
I understand you will be discussing lease negotiations with Perry's tomorrow evening and that the business is seeking some
accommodations due to revenue losses from Covid, the fires and other challenging circumstances.

I encourage you to be flexible with the lease terms with Perry's for a variety of reasons.

1. Perry's has been a beloved business in the Ocean Park neighborhood for many years. If it has to close because its lease terms are too onerous residents in my part of town would be devastated.

2. At my age my memory is not what it used to be, but if I recall correctly during my time on Council we went through a RFP process for these beachfront properties and Perry's was the only entity which responded. That suggests there are a dearth of businesses willing to take on the challenges that come with the beach sites. Consequently, if lease negotiations fail you may wind up with vacancies at the beach, not the best look for the City's realignment plan -- best case scenario you'd get a faceless corporate entity -- let's not forget the fiasco of having McDonald's at the beach decades ago.

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Packet Pg. 939 Attachment: Written Comments (7494 : 5.F. Closed Session - Perry Cafe) 2 3. Just as the City's finances have suffered from Covid, the fires, the decline in international tourism and other factors, so have the revenues of our smaller, independently-owned small businesses.

Lease terms negotiated prior to those multiple economic hits are likely no longer realistic. If the City has been forced by circumstances that were unforeseen six years ago to declare a state of fiscal distress in order to seek relief from certain obligations, then
accommodations are due to businesses facing similar distress.

4. Perry's Richard Chacker has been an engaged member of our business community for years and always eager to contribute to others. I recall in particular his gesture in 2016 when some young cyclists had ridden across the country to promote Hillary Clinton's candidacy for President and arrived in Santa Monica after Election Day exhausted and distraught -- Richard help me set up a "finish line" for them on the bike path in front of one of his cafes and served them food and drink while a modest size crowd feted the cyclists.

Consequently, I urge you to immediately grant Perry's request for short term relief via a rent credit for losses from the fire and a return of its bond funds and to engage constructively on some of its other asks.

Regards,
Ted Winterer
--
Ted Winterer
Realtor @Compass, 2115 Main Street Santa Monica
"Most Loved Real Estate Agent 2025," Santa Monica Daily Press DRE #02047989
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Packet Pg. 940 Attachment: Written Comments (7494 : 5.F. Closed Session - Perry Cafe) 3 To help protect your privacy, Microsoft Office prevented automatic download of this picture from the Internet.

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Packet Pg. 941 Attachment: Written Comments (7494 : 5.F. Closed Session - Perry Cafe) 1 David Yakobson
From: Mike Feinstein <[email protected]>
Sent: Sunday, January 11, 2026 10:31 AM
To: Barry Snell; Lana Negrete; Caroline Torosis; Jesse Zwick; Dan Hall; Ellis Raskin; Natalya Zernitskaya; councilmtgitems
Cc: Oliver Chi; Jennifer Taylor
Subject: Closed Session Agenda Item 5F / Conference with real estate negotiator / Perry's Cafe and Rentals at the beach

EXTERNAL
Dear Council members
As an elected official serving our community, the people have entrusted you with the intangible responsibility of determining ‘what are our community values and how do we implement them in City government?’
When money is flowing freely into City coffers, it is easy to stand for progressive values in public policy. When I was on the Council, that was the case. We were flush with cash much of the time; and when there was a downturn, it was manageable and didn’t compel us to abandon our principles.

Today the City’s finances are very different, as you well know. That forces hard choices.

Hard choices sharpen the test of living our values. To this point, the City just released a statement through the voice of our mayor, marking the one-year anniversary of the devastating Pacific Palisades and AltaDena wildfires:
https://www.facebook.com/cityofsantamonica/posts/pfbid0x57QYrDoNDxzQcKb3ZkhY2Qj 2xbRjzuPKiSWJBApsprowP9KS3PGrkS5WatZBRi2l
“Recovery doesn’t end when the fires are out. Rebuilding homes, reopening businesses….takes time and steady support.”
With this ‘time and steady support’ in mind, I am writing in regards to Closed Session item 5F on Tuesday’s agenda, regarding the City’s price and terms of lease with Perry’s Cafe along Ocean Front Walk.
https://santamonicacityca.iqm2.com/Citizens/Detail_Communication.aspx?Frame=&Meeti ngID=1475&MediaPosition=&ID=2381&CssClass=
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When the City enters into a lease (like it has done with Perry’s and countless others), it is based upon some premise of normalcy in the world.

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Packet Pg. 942 Attachment: Written Comments (7494 : 5.F. Closed Session - Perry Cafe) 2 But what happens when wholly unforeseen negative circumstances occur and the world changes in a flash — and the ability of our lessees to perform to the specifications of their lease is unavoidably impaired? Where do we draw the line in such circumstances, between what is the lessee’s responsibility and what is the City’s role in absorbing some of these negative impacts?
If I were on the Council today, I would take the following into consideration. When we lease the use of City property, we have two primary objectives. One is to assure an income stream and provide services to our community. A second is to promote business enterprises that embody community values. In this sense, when we administer the use of public property, we are both lessors and partners with our lessees.  Regarding the expected income stream and performance from the lessee, we need to acknowledge the unforeseeable and negative impacts of both the COVID shutdown and the Palisades fires upon the lessee’s ability to fully satisfy all expectations in their lease — unforeseeable negative impacts which they explain in depth in the packet they sent to you. In acknowledging these impacts, it is important to recognize that yes the City is hurting from these same circumstances— and yes the City would lose additional funds by providing some relief to the lessee to account for them. But doesn’t mean the City still doesn’t have a responsibility to do so.
 Second, we need to take into account what type of lessee is involved and what intangible community benefits they bring, intangibles that are not easily replicated or replaced.
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Here I need to mention that for 32 years between 1985 and 2017, I lived on the 100 block of Hollister Ave., just steps from the Perry’s at 2400 Ocean Front Walk. During that time I observed an innovative growing small business at Perry’s, that significantly expanded its footprint and services over the years, from what started as a single ‘walk-up-to-the counter with no outdoor seating’ fast food venue in the early 1980s, to the vibrant and beloved destination it is today for locals and visitors alike. Perry’s has done so at 2400 Ocean Front Walk, as well as at their other locations along the beachfront in Santa Monica, which I also pass by on my beach walks, bike rides and time rollerblading.

What I have seen during this time is a small business that gives important employment opportunities to young diverse members of Santa Monica and the greater LA area, helping young people gain a foothold in our local economy. What I see is an efficient food service operation that offers high quality, healthy meals that fit the Santa Monica Sustainable City profile. What I see is a bike and skate rental system that is housed in a structure that Perry’s added over the years, that seems to effortlessly serve a high volume of visitors from all over the world - especially on weekends, holidays and busy summer weekdays, with their bike mechanics maintaining bikes and skates in safe working condition.

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Packet Pg. 943 Attachment: Written Comments (7494 : 5.F. Closed Session - Perry Cafe) 3 I also see an on-site general manager named Aurora, who IMO is a Wise Latina. Aurora has been there for as long as I can remember, and I can see that she has the respect and a positive working relationship with the employees, as she clearly manages the site with grace and fairness. Then there is the proprietor Richard Chacker, who is an highly involved on-site owner, who I watch making numerous judgement calls each day, large and small, on the details of the business’s operation. Rather than being some absentee owner who doesn’t know the community, Richard is not only active in civic affairs with the Chamber and otherwise, but he is at his business day-to-day understanding the realities on the ground.

What is impressive in its entirely with Perry’s is not just how happy customers are sitting in the pleasant, clean and well-maintained outdoor dining area where Perry’s has creatively added sand and couches, or how Perry’s efficiently services its food and rental customers — but how I see the working dynamic between their employees and management. In an environment of managed chaos, where hundreds of members of the public file in and out all day, I see Perry's employees being comfortable coming to management with questions and issues as they arise, and with management taking their input and giving direction in a respectful manner.

In sum, what we have with Perry’s is a unique well-run and innovative small business that fits with and helps define our unique beachfront area — and that embodies a range of community values that we seek from the use of our public property. I share these thoughts with you as an interested community member, and as a former local elected official who understands how the City works. I am not paid by nor do I represent Perry’s in any official capacity.
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In closing, in terms of the specifics of Tuesday’s agenda item before you, I understand that Perry’s is seeking both short term and long term considerations.

I think it is appropriate that City Staff is calling out where they believe that Perry’s has not fulfilled all of the expectations of their lease. Staff is going to go by the book and by the numbers. That is their role and responsibility to the City.

What is not Staff’s role is to decide if and when adjustments should be made, in response to major unforeseeable circumstances like COVID and the Palisades fires. That is your role, the intangible responsibility that we have entrusted in you as residents when we elected you.

A long time ago, an earlier City administration thought that instead of working with this same lessee, that ‘bigger would be better’, and they brought in McDonalds instead to manage the 2400 Ocean Front Walk site before the 1984 Olympics. The community soundly rejected this, McDonald had to leave the site, and the City hurriedly welcomed Perry’s back.

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Packet Pg. 944 Attachment: Written Comments (7494 : 5.F. Closed Session - Perry Cafe) 4 This is not to say that the City should cease issuing RFPs for its properties along Ocean Front Walk — or any of its properties — at regularly scheduled intervals. Clearly, no business has an a priori right to lease and operate on City property forever.

However, that is different than when in the middle of an already signed lease period, major unforeseeable disasters like COVID and the Palisades fire occur. In those instances, that is when the City must especially walk its talk and live its values. Not only is it appropriate in such cases to make compensatory adjustments with a small, family-run business like Perry’s that has served our community for over 40 years. But it sends a signal to other potential applicants for future city leases, about what kind of City Santa Monica is to do business with. Do we interact with our lessees in a reasonable and compassionate manner in keeping with professed City values? Or are we cold-hearted capitalists, for whom extracting maximum income is the sole determinant value? If it is the latter, what kind of future applicants will we attract, and which will we repel? You’ve hired an excellent new City Manager to help the City focus on its finances and the local dynamics that affect it. Making a financial accommodation to a lessee to compensate for special circumstances may seem like a step in the other direction. I hope that in looking at the situation holistically, my comments suggest otherwise.

Thank you for taking the time to read this letter. I hope that on Tuesday evening, you will give City Staff direction to find an accommodation for the disaster circumstances that we were entirely unforeseeable when the current lease was negotiated. In that way you will be walking the talk when the City says ““Recovery doesn’t end when the fires are out.

Rebuilding homes, reopening businesses….takes time and steady support.” Your direction to Staff will be that ‘steady support.’
Sincerely,
Mike Feinstein
Ocean Park Resident since 1985
Santa Monica xCity Council member 1996-2004, Mayor 2000-2002 Item 5-F
January 13, 2026
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5.F.a
Packet Pg. 945 Attachment: Written Comments (7494 : 5.F. Closed Session - Perry Cafe) City Council
Report
City Council Meeting: January 13, 2026
Agenda Item: 5.J
1 of 1
To: Mayor and City Council
From: Heidi Von Tongeln, Interim City Attorney, City Attorney's Office Subject: Conference with legal counsel - significant exposure to litigation - Government Code § 54956.9(d)(2) – 1 case
Prepared By: Esterlina Lugo, Deputy City Clerk
Approved Forwarded to Council
Attachments:

A. Letter to Susan Cola_Proposed Off-Site Pilot Program Ordinance(v2)

5.J
Packet Pg. 946
633 West Fifth Street
Suite 5880
Los Angeles, CA 90071
213.557.7222
www.rpnllp.com
Dave Rand
213.557.7224
[email protected]
January 5, 2026

VIA EMAIL
Susan Cola
Deputy City Attorney
City of Santa Monica
[email protected]

Re: Off-Site Affordable Housing Pilot Incentive Program Dear Ms. Cola:

We represent Cypress Equity Investments (“CEI”) and its associated entities and investors in connection with several pending and approved housing development projects in the City of Santa Monica (“City”). As you know, on August 12, 2025 the City Council adopted an Emergency Interim Zoning Ordinance (“IZO) #2824 creating an Off-Site Affordable Housing Pilot Incentive Program (“Pilot Program”), but capped eligibility for the Pilot Program at 1,000 units. CEI timely submitted applications for five projects totaling 930 units (“Pilot Program Projects”) under the unit-capped Pilot Program and City staff confirmed that CEI had secured 930 of the 1,000 units available under the Pilot Program.

We understand that on January 13, 2026, the City Council will consider an ordinance related to the Pilot Program, which would add two sections to the Santa Monica Municipal Code (“SMMC”).

Proposed SMMC Section 9.64.065 would permanently codify the terms of the unit-capped Pilot Program and would only apply to applications submitted under the unit-capped Pilot Program, including CEI’s previously submitted and vested Pilot Program Projects. The requirements in Section 9.64.065 are substantially the same as the requirements in the unit-capped Pilot Program approved under the IZO.

Proposed SMMC Section 9.64.075 would adopt an expanded and modified version of the Pilot Program, which would only apply prospectively to previously entitled project sites. Section 9.64.075 would not include a unit cap and – significantly – would add several additional restrictions not included in Section

9.64.065 (“Additional Restrictions”). These Additional Restrictions reflect direction City Council provided to staff on September 30, 2025 for the expanded Pilot Program. The City Council direction expressly exempted the first 1000 units utilizing the IZO unit-capped Pilot Program from any of the Additional Restrictions that would be imposed on the expanded Pilot Program.

We appreciate that the proposed draft ordinance to permanently codify the IZO unit-capped Pilot Program is consistent with prior City Council direction and does not add any new requirements.

However, out of an abundance of caution, we also want to apprise you that any future attempt to add the Additional Restrictions to Section 9.64.065, or otherwise apply the Additional Restrictions (or any other new requirements not included in the IZO) to CEI’s vested Pilot Program Projects, would be

5.J.a
Packet Pg. 947 Attachment: Letter to Susan Cola_Proposed Off-Site Pilot Program Ordinance(v2) (7488 : Conference with legal counsel - significant exposure Susan Cola, Deputy City Attorney
January 5, 2026