Agenda packet, first session — Shasta Lake City Council, September 16, 2025

CITY COUNCIL MEETING AGENDA September 16, 2025

CITY OF SHASTA LAKE

CITY COUNCIL

MEETING AGENDA
September 16, 2025
6:00 P.M.

Shasta Lake City Council Chambers
4488 Red Bluff Street  Shasta Lake, CA 96019
Mayor: Pamelyn Morgan
Vice Mayor: Justin Jones
Council Members: Toni Coates, Dan Ringwelski, Greg Watkins

OTHER WAYS TO PARTICIPATE IN THE MEETING
• Watch a livestream of the meeting online or view the recording any time after the meeting concludes at the following: cityofshastalake.gov/meetings • Submit public comment electronically before the meeting to:
[email protected]. Public comment by email will be read into the record during consideration of the item the comment addresses. Each public comment will be limited to three minutes of reading. Include the item number you are commenting on in the subject line of the email. Once the vote has taken place on an item, no additional public comments will beaccepted.
• Submit public comment by mail addressed to City Clerk, City of Shasta Lake, PO Box 777, Shasta Lake, CA 96019. Mailed comments must be received one day prior to the meeting to be included.

1.0 CALL TO ORDER – REGULAR MEETING:

1.1 Call to order (please place electronic devices on silent)

1.2 Statement for the record of Council Members present or absent

1.3 Pledge of Allegiance

1.4 Invocation

2.0 AWARDS & RECOGNITIONS:

2.1 None

3.0 PRESENTATIONS:

3.1 None
1 CITY COUNCIL MEETING AGENDA September 16, 2025

4.0 COMMISSION, COMMITTEE, AND OUTSIDE AGENCY REPORTS:

5.0 PUBLIC COMMENT:

This time is set aside for citizens to address the City Council on matters listed on the Consent Agenda as well as other items not included on the Regular Agenda. If your comments concern an item noted on the regular agenda, please address the Council when that item is open for public comment. Each speaker is allocated three (3) minutes to speak. Speakers may not cede their time. Comments should be limited to matters within the jurisdiction of the City. Council discussion or action cannot be taken on items not listed on the agenda other than to receive comments. Speaker forms are available from the City Clerk, 4477 Main Street, Shasta Lake, on the City’s website, or at the back of the meeting hall. If you have documents to present to members of Council, please provide a minimum of seven copies. Pursuant to The Brown Act, the City Council cannot take action on Public Comment Items.

6.0 CONSENT AGENDA:

The items listed under the Consent Agenda are considered routine business and will be voted on together by one motion unless a Council Member requests a specific item to be removed and discussed separately.

6.1 Minutes of the Regular Meeting of September 2, 2025. (pg. 5)

6.2 Payrolls: (pg. 9)
Period Ending: 8/30/2025 Paid Date: 9/05/2025 $186,216.88

6.3 Checks, E-payments, and wires: (pg. 10)
8/14/2025 $2,075,539.27
8/21/2025 $388,719.13
8/28/2025 $470,737.12
9/04/2025 $821,384.85

6.4 Monthly Report of Investment Transactions: (pg. 29) LAIF:

August $12,863,941.66
Chandler:

August $36,731,255.20

6.5 Discussion and possible action to approve a Resolution awarding the Fisherman’s Point Water Treatment Plant Raw Water Tank Engineering and Design Services Professional Services Contract to Pace Engineering. (pg. 33) 2 CITY COUNCIL MEETING AGENDA September 16, 2025

7.0 PUBLIC HEARINGS:

7.1 None

8.0 REGULAR AGENDA:

8.1 Discussion and possible action to approve a Letter of Support to the Shasta County Board of Supervisors for the continuation of the Shasta County Commission on Aging. (pg. 71)

8.2 Discussion and possible action to approve a Resolution approving the “Third Phase Agreement” with Northern California Power Agency to purchase energy storage services from the “Trolley Pass Project”. (pg. 75)

8.3 Discussion and possible action to approve a Resolution adopting the updated Council Chamber Regulations. (pg. 241)

9.0 STAFF COMMENTS:

10.0 CITY COUNCIL COMMENTS AND REPORTS:

This is the time set aside for Council Members, who may so desire, to give brief comments or reports concerning City matters. The City Council may not enter into discussion on matters reported. Statements made by individual Council Members should not be interpreted as a statement of the City Council. The City Council only takes action by majority vote. • Brief reports by members of the Council regarding correspondence, events and/or meetings attended, and upcoming meetings/events.
• Suggestions/motions for future agenda items.
• In compliance with Assembly Bill 1234, Council will report on attendance at conferences/meetings/events where expenses are reimbursed by the City.

ADJOURNMENT:

Meetings are broadcast on the Wednesday following the meeting at 6:00 PM and the following Friday at 2:00 PM on Charter Channel 181. Videos of meetings are also available through the City website: www.cityofshastalake.org In Compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please call (530) 275-7407. Notification 48 hours prior to the meeting is requested to enable the City to make reasonable arrangements to ensure accessibility to this meeting (28 CFR 35.102-35.104 ADA Title II). 3 4

CITY OF SHASTA LAKE

CITY COUNCIL MEETING MINUTES

MINUTES OF THE REGULAR MEETING
HELD TUESDAY, SEPTEMBER 2, 2025, AT THE
CITY COUNCIL CHAMBERS, 4488 RED BLUFF ST, SHASTA LAKE, CALIFORNIA

1.0 CALL TO ORDER – REGULAR MEETING:.

1.1 Mayor Morgan convened the regular meeting at 6:00 PM

1.2 Council Members present: Coates, Morgan, Jones, Ringwelski, Watkins

1.3 Pledge of Allegiance was led by Councilman Watkins

1.4 Invocation was led by Mayor Morgan

2.0 AWARDS & RECOGNITIONS:

2.1 Proclamation Recognizing September as Suicide Prevention Month to Sydney Stinger, Shasta County, Community Education Specialist / Suicide Prevention Program

3.0 PRESENTATIONS:

3.1 None

4.0 COMMISSION, COMMITTEE, AND OUTSIDE AGENCY REPORTS:

4.1 Janice Powell, Community Spirit Parkway

5.0 PUBLIC COMMENT:

Dolores Lucero, Shasta Lake resident
Mike Freeman, Shasta County Office of Education
Janice Powell, Shasta Lake resident
David Maung, PG&E Area Representative
Jim Mark, Shasta Lake resident

6.0 CONSENT AGENDA:

6.1 Minutes of the Special Meeting of August 19, 2025.

6.2 Minutes of the Regular Meeting of August 19, 2025.

6.3 Payrolls:

Period Ending: 8/16/2025 Paid Date: 8/22/2025 $181,559.70

6.4 Checks, E-payments, and wires:
7/31/2025 $206,453.61
8/07/2025 $965,024.90
5 6.5 Second reading of Ordinance No. 2025-307, Amending Title 17 – Zoning, Chapter

17.04 – “2040 General Plan” to allow continued use of Interim Zoning Ordinance and Overlay Maps.

6.6 Resolution CC-2025-56 accepting the Quarterly Cash and Investment Report for the Period Ending June 30, 2025.

6.7 Resolution CC-2025-57 accepting the Community Spirit Parkway Project and authorizing the filing of a Notice of Completion.

6.8 Resolution CC-2025-58 authorizing a supplemental budget appropriation and declaring SNL Group, Inc. the lowest responsive bidder, and awarding them a construction contract for the Civic Center Mobility Project (Bid No. 2025-06).

Motion/Vote
By motion made/seconded (Coates/Jones), and carried unanimously, the Consent Agenda was approved.

7.0 PUBLIC HEARINGS:

7.1 None

8.0 REGULAR AGENDA:

8.1 Resolution CC-2025-59 appointing two members to the Planning Commission for a term expiring August 2029.

Public Comment
Cheryle Yednak, Shasta Lake resident
Motion/Vote:

By motion made/seconded (Jones/Coates) and carried unanimously, Cherrel Kirkland was appointed to the Planning Commission.

By motion made/seconded (Ringwelski/Watkins), and carried by a vote of 3-2, Charles “Duke” Fleming was appointed to the Planning Commission.

Mayor Morgan and Councilwoman Coates voted opposed to the appointment.

Mayor Morgan called for a short recess at 7:22 PM.

Mayor Morgan called the meeting back to order at 7:26 PM.

8.2 Resolution CC-2025-60 accepting the results of the Wastewater Utility Rate Study and directing staff to prepare a Public Notice in accordance with Prop 218 and set a Public Hearing for consideration of adoption of proposed rates for November 18, 2025.

Public Comment
Tena Eisenbeisz, Shasta Lake resident
Duke Fleming, Shasta Lake resident
Cheryle Yednak, Shasta Lake resident
6 Motion/Vote:

By motion made/seconded (Coates/Ringwelski), and carried unanimously, the item was approved, and the Public Hearing date was set for November 18, 2025.

9.0 STAFF COMMENTS:

City Manager Jessaca Lugo reminded the City Council and public that the 9/11 ceremony will be held at the Fire Hall on Ashby Rd. on September 11, 2025.

10.0 CITY COUNCIL COMMENTS AND REPORTS:

ADJOURNMENT:

With no further business, Mayor Morgan adjourned the meeting at 8:33 PM. ____________________________
CHARITY TATLOW, City Clerk
7 8
9/3/2025 8:39:23 AM Page 6 of 6
Payroll Check Register
City of Shasta Lake Report Summary
Pay Period: 8/17/2025-8/30/2025
Packet: PYPKT00668 - PE 8.30.2025
Payroll Set: City of Shasta Lake - 01
Type
2 Count
0 4,480.38

0.00 Regular Checks
Manual Checks
0 0.00
0 0.00
Amount
84 181,736.50
Total 86 186,216.88
Reversals
Voided Checks
Direct Deposits
9 10
11 12
13 14
15 16
17 18
19 20
21 22
23 24
25 26
27 28
Report and Recommendations 6.4
Reviewed and Approved
City Manager

AGENDA ITEM
City Council
____________________________________________________________ TO: Mayor and City Council Members
FROM: Wendy Howard, Finance Director
Jason Peterson, Finance Manager
DATE: September 16, 2025
SUBJECT: INFORMATION ITEM – MONTHLY REPORTS OF INVESTMENT FOR THE PERIODS ENDING August 31, 2025
FILE NO.:

RECOMMENDATION
Staff recommends that the City Council receive a report of the Cash and Investment Report for the period ending August 2025.

BACKGROUND
Pursuant to the City of Shasta Lake’s Adopted Investment Policy and Government Code Section 53607, the Finance Director will submit a report of investment transactions to the City Council monthly.

Staff requests the City Council or the public to submit questions regarding the reports prior to the City Council Meeting to permit time to research the question.

FISCAL IMPACTS
There will be no fiscal impact as a result of this information item.

ATTACHMENTS
LAIF Statement
Chandler Investment Summary Report
External Link: Monthly Investment Reports (Full Report)

DISTRIBUTION
City Council
City Attorney
29 Local Agency Investment Fund
P.O. Box 942809
Sacramento, CA 94209-0001
(916) 653-3001
September 04, 2025
LAIF Home
PMIA Average Monthly
Yields

CITY OF SHASTA LAKE

FINANCE DIRECTOR
4477 MAIN STREET
SHASTA LAKE, CA 96019
Account Number: 98-45-868
August 2025 Statement
Tran Type Definitions
Account Summary
Total Deposit: 0.00 Beginning Balance: 12,863,941.66
Total Withdrawal: 0.00 Ending Balance: 12,863,941.66
30 MONTHLY ACCOUNT STATEMENT
City of Shasta Lake | Account #10203 | As of August 31, 2025 CHANDLER ASSET MANAGEMENT | chandlerasset.com
Information contained herein is confidential. We urge you to compare this statement to the one you receive from your qualified custodian. Please see Important Disclosures at the end of the statement.

Chandler Team:

For questions about your account, please call (800) 317-4747, or contact [email protected]
Custodian:

PORTFOLIO SUMMARY
Portfolio Characteristics
Sector Allocation
Performance Review
Account Summary
Maturity Distribution
Top Issuers
Credit Quality (S&P)
Total Rate of Return** 1M 3M YTD 1YR 2YRS 3YRS 5YRS 10YRS Since Inception (01/01/14)
City of Shasta Lake 0.86% 1.56% 3.95% 4.70% 5.49% 4.29% 1.89% 2.00% 1.91% Benchmark Return 0.86% 1.41% 3.61% 4.39% 5.13% 3.83% 1.52% 1.69% 1.56% Average Modified Duration 1.83
Average Coupon 4.06%
Average Purchase YTM 4.35%
Average Market YTM 3.92%
Average Credit Quality* AA
Average Final Maturity 2.18
Average Life 1.88
End Values as of
07/31/2025
End Values as of
08/31/2025
Market Value 36,775,667.99 37,074,915.97
Accrued Interest 305,745.66 326,535.28
Total Market Value 37,081,413.65 37,401,451.24
Income Earned 129,797.24 98,235.55
Cont/WD 0.00 0.00
Par 36,788,092.04 36,892,869.03
Book Value 36,618,790.39 36,731,255.20
Cost Value 36,404,407.33 36,536,810.07
Government of The United States 40.64%
Federal Home Loan Banks 9.50%
FHLMC 8.93%
Farm Credit System 2.13%
Bank of America Credit Card Trust 1.81%
PACCAR Inc 1.73%
Walmart Inc. 1.60%
John Deere Owner Trust 1.52%
**Periods over 1 year are annualized.

Benchmark: ICE BofA 1-3 Year US Treasury & Agency Index Secondary Benchmark:
*The average credit quality is a weighted average calculation of the highest of S&P, Moody’s and Fitch. 32 Report and Recommendations 6.5 Reviewed and Approved

City Manager

AGENDA ITEM
City Council
TO: Mayor and City Council Members
FROM: Will Bond, Public Works Director/City Engineer

DATE: September 16, 2025
SUBJECT: CONSULTANT CONTRACT AWARD – FISHERMAN’S POINT

WATER TREATMENT PLANT RAW WATER STORAGE TANK

ENGINEERING DESIGN SERVICES AND SERVICES DURING

CONSTRUCTION
FILE NO.: PRECOMMENDATION:

Staff requests that the City Council award the Fisherman’s Point Water Treatment Plant Raw Water Storage Tank (RWT) Engineering Design Services and Services During Construction Professional Services Agreement contract to PACE Engineering of Redding, CA in the amount of $693,924.00 and approve a total of $750,000.00 to allow for a contract contingency.

BACKGROUND:

In the 2016-2026 Water Master Plan (WMP), the City of Shasta Lake addressed existing water storage capacity deficiencies for raw and treated (potable) water. The Master Plan found that there is currently a Citywide storage capacity deficit of approximately 0.68 MG, and that this deficit will grow in the future. The WMP recommended that both raw and treated capacities be increased. The storage capacity deficit finding was emphasized during the Carr Fire in 2018, when fire personnel used fire hydrants within the City’s service area to supply large amounts of water to areas west of the City limits, while at the same time evacuating City residents turned on sprinkler systems as a precautionary measure. As a result, several tanks were drawn almost completely down, putting the City at significant risk of not having enough water to provide distribution system flows. Had the fire continued north and entered the City, it is likely that there would not have been enough water available to adequately fight the fire within the City’s boundaries. 33 To address the finish water deficiency, the 2.45 million gallon (MG) Centimudi potable water tank is currently under construction and is anticipated to be completed and online by May, 2026. The tank will provide much needed finish water storage for the residents of Shasta Lake. The Centimudi tank is funded by a CDBG-DR grant and water utility capital funds.

Once the Centimudi tank is completed, it is anticipated (but not certain) that the demolition of two existing (0.3 MG and 0.2 MG) finish water storage tanks will occur at the Water Treatment Plant (WTP) to make room for the construction of a single new 1.6 MG raw water storage tank at the same location. Additional work will include associated pipeline work, and technical analysis. However, a task order in the contract will include the analysis of the available space at WTP area, and design alternatives to determine the best location for the new RWT.

In August 2024, the City was awarded a Community Development Block Grant (Contract No. 18-MIT-RIP 23001) for $6,745,000 for the design and construction of the RWT. City Council approved a supplemental budget appropriation, along with a city-funded match of $750,000 on January 21, 2025, via resolution CC-2025-003.

SELECTION PROCESS
On June 13, 2025 a formal RFQ&P outlining the scope of the project was advertised on virtual-bid.com and on the City’s website. Proposals were required to include services fees for the entire scope of services in a separate envelope to be opened after the proposal ranking and interview process. On August 1, 2025 the proposal period closed with the City receiving five proposals.

An evaluation committee was formed with City staff members from the Public Works department and the Development Services Department. The evaluation committee shortlisted three consulting firms and performed interviews. Upon completion of the review and interview process, the committee determined that PACE Engineering was the most qualified firm and possessed the necessary technical expertise that would allow the project to be completed successfully.

City staff then talked with Pace Engineering personnel to refine the scope of services and provide clear guidance to the Consultant. City staff is satisfied that the final negotiated scope of work will both address the project's goals and fulfill the grant's requirements.

FISCAL IMPACTS:

This project has been budgeted and is funded through Community Development Block Grant (CDBG) Disaster Recovery funds and the Water Utility Capital Projects Fund.

ATTACHMENTS:

Resolution
Draft Professional Services Agreement with Scope and Fee DISTRIBUTION:

City Council
34 RESOLUTION CC 2025-XX
______________________________________________________________________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SHASTA LAKE AWARDING THE FISHERMAN’S POINT WATER TREATMENT PLANT RAW WATER

TANK ENGINEERING DESIGN SERVICES AND SERVICES DURING

CONSTRUCTION PROFESSIONAL SERVICES CONTRACT TO PACE
ENGINEERING OF REDDING, CA IN THE AMOUNT OF $693,924.00 AND APPROVE A TOTAL OF $750,000.00 TO ALLOW FOR A CONTRACT CONTINGENCY ______________________________________________________________________ WHEREAS, the City applied for and received Community Development Block Grant Mitigation Funding; and
WHEREAS, the grant proceeds are for the design and construction of the Fisherman’s Point Water Treatment Plant Raw Water Storage Tank Project; and WHEREAS, the City has issued a Request for Qualifications and Proposals, received, and reviewed said proposals, selected the most qualified firm to provide professional services for the project, and negotiated an acceptable scope of work and fee for said services; and
WHEREAS, this project is funded from the following project fund: Expenditure Account:
510-340-6287
NOW, THEREFORE, BE IT RESOLVED THAT the City of Shasta Lake City Council hereby:

Authorizes the City Manager, City Attorney or designee to enter into a professional services agreement contract with PACE Engineering of Redding, CA for professional services related to the Fisherman’s Point Water Treatment Plant Raw Water Storage Tank Engineering Design Services and Services During Construction project in the amount of $693,924.00 and approve a total of $750,000.00 to allow for contract contingency.

PASSED, APPROVED, AND ADOPTED this 16th day of September 2025, by the following vote:

AYES:

NOES:

ABSENT:
_______________________________
PAMELYN ANNE MORGAN, Mayor
ATTEST:
____________________________

CHARITY TATLOW, CMC
City Clerk
35 PROFESSIONAL SERVICES AGREEMENT BETWEEN

THE CITY OF SHASTA LAKE AND PACE ENGINEERING
THIS AGREEMENT is entered into between the City of Shasta Lake ("City") and PACE ENGINEERING ("Consultant") for the purpose of Fisherman’s Point Water Treatment Plant Raw Water Tank Engineering Design Services and Services During Construction. The effective date of this agreement shall be on or about September 22, 2025.

1. SCOPE OF SERVICES
Subject to the terms and conditions set forth in this Agreement, Consultant shall provide to City the services described in Exhibit A (Scope of Work).Consultant warrants that it possesses the experience, background, and expertise necessary to perform the services described in Exhibit A, and Consultant agrees that it shall provide the services at the time, place and in the manner specified in Exhibit A.

No verbal agreement or conversation with any officer, agent or employee of City, either before, during or after the execution of this Agreement shall affect or modify any of the terms or conditions contained in this Agreement, nor shall any such verbal agreement or conversation entitle Consultant to any additional payment whatsoever under the terms of this Agreement.

2. COMPENSATION AND REIMBURSEMENT OF COSTS
Consultant shall not be compensated for services outside the Scope of Services outlined in Exhibit "A", prior to the commencement of such services:

A. Consultant notifies City and City agrees that such services outside the scope of Exhibit A are to be performed;
B. Consultant estimates the additional compensation required for the additional services, and
C. City, after notice, approves in writing the additional services and amount of compensation therefore.

City shall pay Consultant for services rendered pursuant to this Agreement and travel, lodging, and incidental expenses shall not exceed $693,924.00. This payment shall be the only payment to be made to Consultant for services rendered pursuant to this Agreement unless the City provides prior written approval.

Consultant shall submit monthly invoices to City for work completed and reasonable expenses incurred to the date of the invoice. All invoices shall be itemized to reflect the tasks completed and the amount billed for each task. In accordance with the State of California Senate Bill 1383 and City of Shasta Lake Municipal Code Chapter 8.07, beginning January 1, 2022, invoices and/or documentation printed on paper products shall consist of at least thirty (30%) percent, by fiber weight, postconsumer fiber, or as otherwise defined in 14 CCR Section 18982(a)(61).
36 Professional Services Agreement Page 2 of 11
City shall pay all out-of-pocket travel, lodging and incidental expenses incurred by Consultant that are reasonably associated with the provision of services under this Agreement. These expenses shall be compensated by City at their cost to Consultant. Consultant shall keep receipts for such expenses in compliance with IRS requirements. These receipts shall be available to City for inspection upon request.

All invoices sent by Consultant to City shall be paid within thirty (30) days of receipt. All billings that remain unpaid after thirty (30) days shall bear interest until paid at the rate of five percent (5%) per annum or the maximum rate allowed by law, whichever is less.

If City fails to pay any invoice within thirty (30) days and such failure continues ten (10) days after Consultant gives City notice of such failure, Consultant shall have the right to terminate this Agreement immediately without liability to City. The right to terminate under the terms of this section shall be in addition to all other legal, equitable, or contractual remedies available to Consultant.

3. TERM OF AGREEMENT
This Agreement shall commence on or about September 22, 2025 and shall terminate effective December 31, 2030, unless terminated sooner as provided in paragraph 15 herein.

4. CITY’S DUTIES
The City shall make its facilities accessible to Consultant as required for performance of its services and shall provide labor and safety equipment as required by Consultant for such access. City agrees to cooperate with Consultant and be reasonably available to confer with Consultant upon request, to keep Consultant informed of developments and to disclose to Consultant all facts and circumstances of which City is aware which may bear upon Consultant’s handling of the matter. City agrees to provide Consultant with such documents and information as City may possess relating to the matter, and to abide by all terms of this Agreement.

5. ADVERTISEMENTS, PERMITS, ACCESS
Unless otherwise agreed to in the Scope of Services, the City shall obtain, arrange and pay for all advertisements for bids, permits and licenses required by local, state or federal authorities.

Consultant represents and warrants to City that it has all licenses, permits, qualifications and approvals of any nature whatsoever which are legally required for Consultant to practice its profession. Consultant represents and warrants to City that Consultant shall, at its sole cost and expense, keep in effect or obtain at all times during the term of this Agreement, any licenses, permits, and approvals which are legally required for Consultant to practice its profession.

6. RELATIONSHIP OF PARTIES, NO THIRD-PARTY BENEFICIARIES Consultant is an independent contractor under this Agreement. This Agreement gives no rights or benefits to anyone not named as a party to this Agreement, and there are no third party beneficiaries to this Agreement.

7. SUBCONTRACTS
Except as provided in paragraph 10.2 herein, Consultant may use the services of independent contractors to perform a portion of its obligations under this Agreement without prior written approval by City.

Independent contractors and subcontractors shall be provided with a copy of this Agreement and shall 37 Professional Services Agreement Page 3 of 11
agree to be bound by its terms. Consultant shall be the responsible party with respect to all actions of its independent contractors and subcontractors, and shall obtain such insurance and indemnity provisions from its contractors and subcontractors the City shall determine to be necessary.

8. NO DISCRIMINATION
In the performance of this Agreement, Consultant shall not discriminate against any employee or applicant for employment because of race, religion, color, sex, national origin, sexual orientation or medical condition. Consultant shall take affirmative action to ensure applicants are employed and that employees are treated during their employment without regard to their race, religion, color, sex, national origin, sexual orientation or medical condition. Such actions shall include, but not be limited to, the following:
employment, upgrading, demotion or transfer, recruitment or recruitment advertising, layoff or termination, rates of pay or other forms of compensation and selection for training.

9. INSURANCE REQUIREMENTS

9.1 To the fullest extent allowed by law, the Consultant shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder by the Consultant, its agents, representatives, or employees.

Errors & Omissions Liability Insurance requirements apply to Consultants performing Professional Services. Construction contractors may disregard this coverage unless specifically required by the Contract Documents.

9.2 Minimum Scope of Insurance:

Coverage shall be at least as broad as:
a) Insurance Services Office Commercial General Liability coverage (occurrence Form CG 00 01). b) Insurance Services Office Form Number CA 00 01 covering Automobile Liability, Code 1 (any auto).
c) Workers’ Compensation insurance as required by the State of California and Employers’ Liability insurance.
d) Errors & Omissions Liability insurance appropriate to the consultant’s profession. Architects’ and engineers’ coverage is to be endorsed to include contractual liability.

9.3 Minimum Limits of Insurance:

1. General Liability:
(Including operations,
products and completed
operations, as applicable.)
$1,000,000 Combined single limit per
occurrence, including operations,
products and completed operations.
$2,000,000 Aggregate limit for bodily injury,
personal, personal injury and
property damage.

2. Comprehensive Automobile
Liability:
$1,000,000 Owned, non-owned, hired vehicles

3. Workers’ Compensation: As required by the Labor Code of the State of California
38 Professional Services Agreement Page 4 of 11

4. Employers’ Liability: $1,000,000 Per occurrence, bodily injury by disease
$1,000,000 Each employee, bodily injury by
disease

5. Errors & Omissions Liability: $1,000,000
$2,000,000
Per occurrence
Aggregate Limit

6. Pollution Liability
(required when work
includes asbestos or lead
paint)
$1,000,000
$2,000,000
Per occurrence
Aggregate Limit

9.4 Deductibles and Self-Insured Retentions:

1. Any deductibles or self-insured retentions must be disclosed to and approved by the City, and shall not reduce the limits of liability. At the option of the City, either: the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects the City, its officers, officials, employees and volunteers; or the Consultant shall provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention.

2. Policies containing any self-insured retention provisions shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the named insured or the City.

9.5 Other Insurance Provisions:

1. It shall be a requirement under this agreement that any available insurance proceeds in excess of the specified minimum Insurance coverage requirements and limits shall be available to the Additional Insured. Furthermore, the requirements for coverage and limits shall be a) the minimum coverage and limits specified in this Agreement or b) the full coverage and maximum limits of any Insurance proceeds available to the named insured, whichever is greater.

2. Where subcontractors/ subconsultants are used, the Consultant agrees to include in their subcontract the same requirements and provisions of this agreement, including the indemnity and insurance requirements to the extent they apply to the scope of the subcontractor’s/ subconsultant’s work. Subcontractors/ subconsultants hired by the Consultant agree to be bound to the Consultant and the City in the same manner and to the same extent as the Consultant is bound to the City under the Contract Documents. Subcontractors/ Subconsultants further agree to include the same requirements and provisions of the contract agreement, including the indemnity and insurance requirements, with any subsubcontractors/sub-subconsultants to the extent they apply to the scope of the subsubcontractor’s/sub-subconsultant’s work. A copy of the City’s Contract Documents, including the indemnity and insurance provisions, shall be furnished to the subcontractor/subconsultant upon request.

Subcontractors/Subconsultants responsibility for defense and indemnity obligations shall survive the termination or completion of the contract agreement for the full period of time allowed by law.
39 Professional Services Agreement Page 5 of 11

3. The limits of insurance required in this agreement may be satisfied by a combination of primary and umbrella or excess insurance. Any umbrella or excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary and noncontributory basis for the benefit of the City (if agreed to in a written contract or agreement) before the City’s own insurance shall be called upon to protect it as a named insured.

4. The defense and indemnification obligations of this contract agreement are undertaken in addition to, and shall not in any way be limited by, the insurance obligations contained in the contract agreement.

5. The City reserves the right to obtain a full certified copy of any insurance policy and endorsements. Failure to exercise this right shall not constitute a waiver of right to exercise later.

The Commercial General Liability and Automobile Liability policies are to contain, or be endorsed to contain, the following provisions:

1. The City, its officers, officials, employees and volunteers are to be covered as additional insureds as respects: liability arising out of work or operations performed by or on behalf of the Consultant; or automobiles owned, leased, hired or borrowed by the Consultant.

2. The additional insured coverage under the Consultant’s policy shall be primary and noncontributory, and will not seek contribution from the City’s insurance.

3. For any claims related to this project, the Consultant’s insurance coverage shall be primary insurance as respects the City, its officers, officials, employees and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees or volunteers shall be excess of the Consultant’s insurance and shall not contribute with it.

4. Each insurance policy required by this clause shall be endorsed to state that coverage shall not be canceled by either party, except after thirty (30) days prior written notice has been provided to the City.

If General Liability, Contractors Pollution Liability and/or Asbestos Pollution Liability and or Errors & Omissions coverages are written on a claims-made form:

1. The retroactive date must be shown, and must be before the date of the contract or the beginning of contract work.

2. Insurance must be maintained and evidence of insurance must be provided for at least five (5) years after completion of the contract of work.

3. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a retroactive date prior to the contract effective date, the Consultant must purchase an extended period coverage for a minimum of five (5) years after completion of contract work.

4. A copy of the claims reporting requirements must be submitted to the City for review. 40 Professional Services Agreement Page 6 of 11

5. If the services involve lead-based paint or asbestos identification/remediation, the Contractors Pollution Liability policy shall not contain lead-based paint or asbestos exclusions. If the services involve mold identification/remediation, the Contractors Pollution Liability policy shall not contain a mold exclusion and the definition of “Pollution” shall include microbial matter including mold.

9.6 Acceptability of Insurers
Insurance is to be placed with insurers with a current A.M. Best rating of no less than A:VII, unless otherwise acceptable to the City. Exception may be made for the State Compensation Insurance Fund when not specifically rated.

9.7 Verification of Coverage
Consultant shall furnish the City with endorsements affecting coverage required by this clause. The endorsements are to be signed by a person authorized by that Insurer to bind coverage on its behalf. The endorsements are to be on forms provided by the City, unless the insurance company will not use the City’s forms. All endorsements are to be received and approved by the City before work commences. However, failure to do so shall not operate as a waiver of these insurance requirements. As an alternative to the City’s forms, the Consultant’s insurer may provide complete certified copies of all required insurance policies, including endorsements effecting the coverage required by these specifications at any time.

9.8 Indemnity and Hold Harmless
Consultant shall indemnify and hold harmless the City, their elected officials, officers, employees, agents and volunteers, and each and every one of them, against all claims, suits, actions, costs, counsel fees, expenses, damages, judgments or decrees by reason of any person or person’s bodily injury, including death, or property being damaged by Consultant or any person employed by Consultant or in any capacity during the progress of the work by negligence except where caused by the sole negligence or willful misconduct of the City.

Consultant shall also indemnify City of any adverse determination made by the Internal Revenue Service or the State Franchise Tax Board against those agencies with respect to Consultant’s “independent contractor” status that would establish a liability for failure to make social security or income tax withholding payments.
41 Professional Services Agreement Page 7 of 11

10. STANDARD OF PERFORMANCE

10.1 Consultant shall perform all services required pursuant to this Agreement in the manner and according to the standards observed by a competent practitioner of the profession. All products of any nature, which Consultant delivers to City pursuant to this Agreement, shall be prepared in a professional manner and conform to the standards of quality normally observed by a person practicing the profession of Consultant and its agents, employees and subcontractors assigned to perform the services contemplated by this Agreement.

10.2 Key Personnel. In selecting the Consultant for this Contract, the City relied on the qualifications and experience of those persons identified by Consultant by name as performing the Services.

Consultant shall not reassign or replace Key Personnel without the written consent of the City, which consent will not be unreasonably withheld. The City may at any time in writing notify Consultant that the City will no longer accept performance of Services under this Contract by one or more Key Personnel. Upon that notice Consultantshall immediately suspend the services of such person(s) and provide a replacement of comparable qualifications and experience who is acceptable to the City.

11. RELIANCE UPON DATA, DOCUMENTS AND RECORDS
Consultant shall be entitled to rely upon the accuracy and completeness of all data furnished by City to Consultant that is used by Consultant in the providing of services under this Agreement. Consultant may retain and use all data furnished to it, except such data which may be marked "confidential" and required to be returned, and may use all plans, designs, specifications and other work product created by Consultant in providing services hereunder. Any use of such work product which includes proprietary information shall not identify City, nor shall the manner of such use have the effect of identifying City.

12. OWNERSHIP AND USE OF DOCUMENTS AND ELECTRONIC MEDIA DELIVERABLES All completed reports and other data or documents, or computer media including diskettes and other materials provided or prepared by Consultant in accordance with this Agreement are the property of City, and may be used by City.

City shall release, defend, indemnify and hold harmless Consultant from all claims, costs, expenses, damage or liability arising out of or resulting from the use or modification of any reports, data, documents, drawings, specifications or other work product prepared by Consultant, except use by City on those portions of Project for which such items were prepared.

13. RESOLUTIONS OF DISPUTES, ATTORNEYS FEES
The laws of the State of California shall govern the interpretation of and the resolution of disputes under this Agreement. If any claim, at law or otherwise is made by either party to this Agreement, the prevailing party shall be entitled to its costs and reasonable attorneys' fees. Consultant shall continue with the responsibilities under this Agreement during any dispute unless waived in writing by City. Any legal action relating to this contract will be venued in Shasta County. 42 Professional Services Agreement Page 8 of 11

14. CONFLICT OF INTEREST
A. Consultant shall disclose any financial, business, or other relationship with the City that may have an impact upon the outcome of this contract, or any ensuing City construction project. Consultant shall also list current clients who may have a financial interest in the outcome of this contract, or any ensuing City construction project, which will follow.

B. Consultant hereby certifies that it does not now have, nor shall it acquire any financial or business interest that would conflict with the performance of services under this contract.

C. Consultant hereby certifies that neither Consultant, nor any firm affiliated with Consultant will bid on any construction contract, or on any contract to provide construction inspection for any construction project resulting from this contract. An affiliated firm is one, which is subject to the control of the same persons through joint-ownership, or otherwise.

D. Except for subconsultants whose services are limited to providing surveying or materials testing information, no subconsultant who has provided design services in connection with this contract shall be eligible to bid on any construction contract, or on any contract to provide construction inspection for any construction project resulting from this contract.

15. TERMINATION OF AGREEMENT
If Consultant fails to perform his/her duties to the satisfaction of the City or if Consultant fails to fulfill in a timely and professional manner his/her obligations under this Agreement, or if Consultant violates any of the terms or provisions of this Agreement, then City shall have the right to terminate this Agreement effective immediately upon the City giving written notice thereof to Consultant. In the event City shall give such notice of termination, Consultant shall immediately cease rendering services pursuant to this Agreement.

Either party may terminate this Agreement on 30 days’ written notice. City shall pay Consultant for all work satisfactorily completed as of the date of notice.

City may terminate this Agreement immediately upon oral notice should funding cease or be materially decreased.

In the event City terminates this Agreement:

A. City shall have full ownership and control of all writings which have been delivered by Consultant pursuant to this Agreement and all drafts of reports and writings which form the basis for any writing or report which would have been otherwise delivered to City pursuant to this Agreement; B. City shall pay Consultant the reasonable value of services rendered by Consultant pursuant to this Agreement provided, however, City shall not in any manner be liable for lost profits which might have been made by Consultant had Consultant completed the services required by this Agreement.

In this regard, Consultant shall furnish to City such financial information as in the judgment of the City representative is necessary to determine the reasonable value of the services rendered by Consultant.

16. COMPLIANCE WITH LAWS
43 Professional Services Agreement Page 9 of 11
Consultant shall comply with all applicable laws, ordinances, and codes of the federal, state and local governments.

17. REPRESENTATIVES OF THE PARTIES
The City’s representative for this Agreement is:
<Name>
<Job Title>, City of Shasta Lake
4477 Main Street
Shasta Lake, CA 96019
530.275.7400
<Email Address>
All Consultant questions pertaining to this Agreement shall be referred to the above named person, or the representative's designee.

The Consultant’s representative for this Agreement is:
<Name>
<Job Title>, <Consulting Firm>
<Address>
<City, State, ZIP>
<Phone>
<Email>
All City questions pertaining to this Agreement shall be referred to the above named person.

18. NOTICES
All notices, requests, demands and other communications hereunder shall be deemed given only if in writing signed by an authorized representative of the sender (may be other than the representative referred to in Paragraph 17 above), and delivered by facsimile with a hard copy mailed first class, postage prepaid, or when sent by a courier or express services guaranteeing overnight delivery to the receiving party, and addressed to the respective party as follows:

To City: Charity Tatlow, Deputy City Clerk
City of Shasta Lake
P.O. Box 777
4477 Main Street
Shasta Lake, CA 96019
To Consultant: <Name>
<Job Title>, <Consulting Firm>
<Address>
<City, State, ZIP>
<Phone>
<Email>
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19. ENTIRE AGREEMENT
This document, including all exhibits, contains the entire agreement between the parties and supersedes any oral or written understanding they may have had prior to the execution of this Agreement. Consultant shall be entitled to no other benefits other than those specified herein. No amendments or alterations shall be effective unless in writing and signed by both parties. Consultant specifically acknowledges that in entering into and executing this Agreement, Consultant relies solely upon the provisions contained in this Agreement and no others.

20. SEVERABILITY
If any portion of this Agreement or the application thereof to any person or circumstance shall be invalid or unenforceable to any extent, the remainder of this Agreement shall not be affected thereby and shall be enforced to the greatest extent permitted by law.

21. EMPLOYMENT STATUS
Consultant shall, during the entire term of this Agreement, be construed to be an independent contractor and nothing in this Agreement is intended nor shall be construed to create an employer-employee relationship, a joint venture relationship, or to allow City to exercise discretion or control over the professional manner in which Consultant perform the services which are the subject matter of this Agreement, provided always, however, that the services to be provided by Consultant shall be provided in a manner consistent with the professional standards applicable to such services. The sole interest of City is to assure that services shall be rendered and performed in a competent, efficient and satisfactory manner.

Consultant shall be fully responsible for payment of all taxes due to the State of California or the federal government which would be withheld from compensation if Consultant were a City employee. City shall not be liable for deductions for any amount for any purpose from Consultant’s compensation. Consultant shall not be eligible for coverage under City’s worker’s compensation insurance plan nor shall Consultant be eligible for any other City benefit.

22. HEADINGS, ASSIGNMENT AND WAIVER
The headings in this Agreement are inserted for convenience only and shall not constitute a part hereof.

Neither party to this Agreement shall assign its duties and obligations hereunder without the prior written consent of the other party. A waiver of any part of any provision or a breach of this Agreement must be provided in writing and shall not be construed as a waiver of any other provision or any succeeding breach of the same or any other provisions herein.

23. AUTHORITY
The undersigned hereby represent and warrant that they are authorized by the parties to execute this Agreement.
45 Professional Services Agreement Page 11 of 11
IN WITNESS WHEREOF, City and Consultant have executed this Agreement below:

CITY OF SHASTA LAKE
By: ___________________________________ ________________ John S. Kenny Date
City Attorney, City of Shasta Lake

CONSULTANT
By: ___________________________________ ________________ <Consultant Name> Date
<Title>, <Consultant Firm>
Distribution: Consultant (1 original), City Clerk (1 original), Finance (1 copy with Purchase Order), Project File (1 copy) 4874-4976-0966, v. 1
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Appendix B – CDBG-DR Sample Rider
Community Development Block Grant Program Disaster Recovery Rider This Community Development Block Grant Program Rider contains supplementary general conditions for use with procurement contracts and subrecipient agreements that are funded in whole or in part by the U.S. Department of Housing and Urban Development (“HUD”) under Title I of the Housing and Community Development Act of 1974 (Pub. L. 93-383) as amended.

For all procurement contracts and subrecipient agreements funded fully or in part by the Community Development Block Grant Disaster Recovery (“CDBG-DR”) Program by and between the City of Shasta Lake , State of California, acting herein by City Manager, hereunto duly authorized, and [name consultant firm], a [type of business (partnership, corporation)] organized under the laws of the State of California, acting herein by [name], [Chief Executive Officer or appointed representative, hereunto duly authorized; this CDBG Rider will serve as a universal addendum to each of those contracts and/or agreements.

This Rider must be signed separately as a stand-alone document, and the terms and provisions outlined herein will be applicable to all contracts and agreements between City of Shasta Lake , and [name consultant firm] in which CDBG-DR grant funds are a funding source.

FEDERAL REGISTER NOTICES

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
Federal Register Notices applicable to the use of CDBG-DR Funds for all associated grants are available on the HUD Web site at:
https://www.hudexchange.info/programs/cdbg-dr/cdbg-dr-laws-regulations-and-federal-registernotices/ CDBG-DR-INFR Procurement Policies and Procedures
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COMPLIANCE PROVISIONS FOR CDBG-DR RIDER
FOR

PROFESSIONAL SERVICES CONTRACTS

CONTENTS

1. EQUAL EMPLOYMENT OPPORTUNITY (Equal Opportunity Clause)

2. CERTIFICATION OF NONSEGREGATED FACILITIES

3. CIVIL RIGHTS

4. SECTION 109 OF THE HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1974

5. SECTION 3 OF THE HOUSING AND URBAN DEVELOPMENT ACT OF 1968 -

COMPLIANCE IN THE PROVISION OF TRAINING, EMPLOYMENT AND BUSINESS

OPPORTUNITIES

6. SECTION 503 OF THE REHABILITATION ACT OF 1973 (29 USC 793)

7. SECTION 504 OF THE REHABILITATION ACT OF 1973, AS AMENDED

8. AGE DISCRIMINATION ACT OF 1975

9. CERTIFICATION OF COMPLIANCE WITH AIR AND WATER ACTS

10. FLOOD DISASTER PROTECTION

11. ACCESS TO RECORDS - MAINTENANCE OF RECORDS

12. INSPECTION

13. REPORTING REQUIREMENTS

14. CONFLICT OF INTEREST

15. ACTIVITIES AND CONTRACTS NOT SUBJECT TO EXECUTIVE ORDER 11246, AS

AMENDED

16. PATENTS

17. COPYRIGHT

18. TERMINATION FOR CAUSE

19. TERMINATION FOR CONVENIENCE
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20. ENERGY EFFICIENCY

21. SUBCONTRACTS

22. DEBARMENT, SUSPENSION, AND INELIGIBILITY

23. BREACH OF CONTRACT TERMS

24. PROVISIONS REQUIRED BY LAW DEEMED INSERTED

25. CHANGES

26. PERSONNEL

27. ANTI-KICKBACK RULES

28. ASSIGNABILITY

29. INTEREST OF CONTRACTOR

30. POLITICAL ACTIVITY

31. COMPLIANCE WITH THE OFFICE OF MANAGEMENT AND BUDGET

32. DISCRIMINATION DUE TO BELIEF

33. CONFIDENTIAL FINDINGS

34. LOBBYING

35. AUTHORIZATION

1. EQUAL EMPLOYMENT OPPORTUNITY (Equal Opportunity Clause) (applicable to contracts and subcontracts above $10,000) During the performance of any contract, the Contractor agrees as follows:

A. The Contractor will not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin. The Contractor will take affirmative action to ensure that applicants are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, or national origin. Such action shall include, but not be limited to, the following: employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship. The Contractor agrees to post in conspicuous places, available to employees and applicants for employment, notices to be provided setting forth the provisions of this nondiscrimination clause.

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B. The Contractor will, in all solicitations or advertisements for employees placed by or on behalf of the Contractor, state that all qualified applicants will receive consideration without regard to race, color, religion, sex, or national origin.

C. The Contractor will send to each labor union or representative of workers with which he has a collective bargaining agreement or other contract or understanding, a notice to be provided by the Contract Compliance Officer advising the said labor union or workers' representatives of the Contractor's commitment under this section, and shall post copies of the notice in conspicuous places available to employees and applicants for employment.

D. The Contractor will comply with all provisions of Executive Order 11246 of September 24, 1965, as amended, and the rules, regulations, and relevant orders of the Secretary of Labor.

E. The Contractor will furnish all information and reports required by Executive Order 11246 of September 24, 1965, as amended, and by rules, regulations, and orders of the Secretary of Labor, or pursuant thereto, and will permit access to his books, records, and accounts by the Department and the Secretary of Labor for purposes of investigation to ascertain compliance with such rules, regulations, and others.

F. In the event of the Contractor's noncompliance with the non-discrimination clauses of any contract or with any of the said rules, regulations, or orders, that contract may be cancelled, terminated, or suspended in whole or in part and the Contractor may be declared ineligible for further Government contracts in accordance with procedures authorized in Executive Order 11246 of September 24, 1965, as amended, or by rule, regulation, or order of the Secretary of Labor, or as otherwise provided by law.

G. The Contractor will include the provisions of the sentence immediately preceding paragraph A and the provisions of paragraphs A through G in every subcontract or purchase order unless exempted by rules, regulations, or orders of the Secretary of Labor issued pursuant to Section 204 of Executive Order 11246 of September 24, 1965, as amended, so that such provisions will be binding upon each subcontractor or vendor. The Contractor will take such action with respect to any subcontract or purchase order as the Department may direct as a means of enforcing such provisions, including sanctions for noncompliance.

Provided, however, that in the event a contractor becomes involved in, or is threatened with, litigation with a subcontractor or vendor as a result of such direction by the Department, the Contractor may request the United States to enter into such litigation to protect the interest of the United States.

2. CERTIFICATION OF NONSEGREGATED FACILITIES
(applicable to contracts and subcontracts over $10,000) By the submission of this bid, the bidder, offeror, applicant or subcontractor certifies that he/she does not maintain or provide for his/her establishments, and that he/she does not permit employees to perform their services at any location, under his/her control, where segregated facilities are maintained. He/she certifies further that he/she will not maintain or provide for employees any segregated facilities at any of his/her establishments, and he/she will not permit employees to perform their services at any location under his/her control where segregated facilities are maintained. The bidder, offeror, applicant or subcontractor agrees that a breach of this certification is a violation of the equal opportunity clause of this contract.

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As used in this certification, the term "segregated facilities" means any waiting rooms, work areas, rest rooms and wash rooms, restaurants and other eating areas, time clocks, locker rooms, and other storage or dressing areas, parking lots, drinking fountains, recreation or entertainment areas, transportation and housing facilities provided for employees which are segregated by explicit directive or are, in fact, segregated on the basis of race, color, religion, or national origin because of habit, local custom, or any other reason.

He/she further agrees that (except where he/she has obtained for specific time periods) he/she will obtain identical certification from proposed subcontractors prior to the award of subcontracts exceeding $10,000 which are not exempt from the provisions of the equal opportunity clause; that he/she will retain such certifications in his/her files; and that he/she will forward the following notice to such proposed subcontractors (except where proposed subcontractors have submitted identical certifications for specific time periods).

3. CIVIL RIGHTS
The Contractor shall comply with the provisions of Title VI of the Civil Rights Act of 1964. No person shall, on the grounds of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving federal financial assistance.

4. SECTION 109 OF THE HOUSING AND COMMUNITY DEVELOPMENT ACT OF 1974
The Contractor shall comply with the provisions of Section 109 of the Housing and Community Development Act of 1974. No person in the United States shall on the grounds of race, color, national origin, or sex be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity funded in whole or in part with funds made available under this title. Section 109 further provides that discrimination on the basis of age under the Age Discrimination Act of 1975 or with respect to an otherwise qualified handicapped individual as provided in Section 504 of the Rehabilitation Act of 1973, as amended, is prohibited.

5. SECTION 3 OF THE HOUSING AND URBAN DEVELOPMENT ACT OF 1968 -

COMPLIANCE IN THE PROVISION OF TRAINING, EMPLOYMENT AND BUSINESS

OPPORTUNITIES
A. The work to be performed under any contract is subject to the requirements of Section 3 of the Housing and Urban Development Act of 1968, as amended, 12 U.S.C. 1701u (section 3). The purpose of section 3 is to ensure that employment and other economic opportunities generated by HUD assistance or HUD-assisted projects covered by Section 3, shall, to the greatest extent feasible, be directed to low- and very low-income persons, particularly persons who are recipients of HUD assistance for housing.

B. The parties to any contract agree to comply with HUD's regulations in 24 CFR part 135, which implement Section 3. As evidenced by their execution of this contract, the parties to CDBG-DR-INFR Procurement Policies and Procedures
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any contract certify that they are under no contractual or other impediment that would prevent them from complying with the part 135 regulations.

C. The contractor agrees to send to each labor organization or representative of workers with which the contractor has a collective bargaining agreement or other understanding, if any, a notice advising the labor organization or workers' representative of the contractor's commitments under this Section 3 clause, and will post copies of the notice in conspicuous places at the work site where both employees and applicants for training and employment positions can see the notice. The notice shall describe the Section 3 preference, shall set forth minimum number and job titles subject to hire, availability of apprenticeship and training positions, the qualifications for each, and the name and location of the person(s) taking applications for each of the positions, and the anticipated date the work shall begin.

D. The contractor agrees to include this Section 3 clause in every subcontract subject to compliance with regulations in 24 CFR part 135, and agrees to take appropriate action, as provided in an applicable provision of the subcontract or in this Section 3 clause, upon a finding that the subcontractor is in violation of the regulations in 24 CFR part 135. The contractor will not subcontract with any subcontractor where the contractor has notice or knowledge that the subcontractor has been found in violation of the regulations in 24 CFR part 135.

E. The contractor will certify that any vacant employment positions, including training positions, that are filled (1) after the contractor is selected but before the contract is executed, and (2) with persons other than those to whom the regulations of 24 CFR part 135 require employment opportunities to be directed, were not filled to circumvent the contractor's obligations under 24 CFR part 135.

F. Noncompliance with HUD's regulations in 24 CFR part 135 may result in sanctions, termination of any contract for default, and debarment or suspension from future HUD assisted contracts.

G. With respect to work performed in connection with Section 3 covered Indian housing assistance, Section 7(b) of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450e) also applies to the work to be performed under this contract. Section 7(b) requires that to the greatest extent feasible (i) preference and opportunities for training and employment shall be given to Indians, and (ii) preference in the award of contracts and subcontracts shall be given to Indian organizations and Indian-owned Economic Enterprises. Parties to any contract that are subject to the provisions of Section 3 and section 7(b) agree to comply with Section 3 to the maximum extent feasible, but not in derogation of compliance with Section 7(b).

6. SECTION 503 OF THE REHABILITATION ACT OF 1973 (29 USC 793) (applicable to contracts and subcontracts over $10,000) A. The contractor will not discriminate against any employee or applicant for employment because of physical or mental handicap in regard to any position for which the employee or applicant for employment is otherwise qualified. The contractor agrees to take affirmative action to employ, advance in employment and otherwise treat qualified handicapped individuals without discrimination based upon their physical or mental handicap in all employment practices such as the following: employment upgrading, demotion or transfer, recruitment, advertising, layoff or termination, rates of pay or other forms of compensation, and selection for training, including apprenticeship.

B. The Contractor agrees to comply with the rules, regulations, and relevant orders of the Secretary of Labor issued pursuant to the Act.

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C. In the event of the Contractor's noncompliance with the requirements of this clause, actions for noncompliance may be taken in accordance with the rules, regulations, and relevant orders of the Secretary of Labor issued pursuant to the Act.

D. The Contractor agrees to post in conspicuous places, available to employees and applicants for employment, notices in a form to be prescribed by the Director, provided by or through the contracting officer. Such notices shall state the Contractor's obligation under the law to take affirmative action to employ and advance in employment qualified handicapped employees and applicants for employment, and the rights of applicants and employees.

E. The Contractor will notify each labor union or representative of workers with which it has a collective bargaining agreement or other contract understanding, that the Contractor is bound by the terms of Section 503 of the Rehabilitation Act of 1973, and is committed to take affirmative action to employ and advance in employment physically and mentally handicapped individuals.

F. The Contractor will include the provisions of this clause in every subcontract or purchase order of $10,000 or more unless exempted by rules, regulations, or orders of the Secretary issued pursuant to Section 503 of the Act, so that such provisions will be binding upon each subcontractor or vendor. The Contractor will take such action with respect to any subcontract or purchase order as the Director of the Office of Federal Contract Compliance Programs may direct to enforce such provisions, including action for noncompliance.

7. SECTION 504 OF THE REHABILITATION ACT OF 1973, AS AMENDED The Contractor agrees that no otherwise qualified individual with disabilities shall, solely by reason of his disability, be denied the benefits, or be subjected to discrimination including discrimination in employment, any program or activity that receives the benefits from the federal financial assistance.

8. AGE DISCRIMINATION ACT OF 1975
The Contractor shall comply with the provisions of the Age Discrimination Act of 1975. No person in the United States shall, on the basis of age, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under, any program or activity receiving federal financial assistance.

9. CERTIFICATION OF COMPLIANCE WITH AIR AND WATER ACTS
(applicable to contracts and subcontracts exceeding $100,000) The Contractor and all subcontractors shall comply with the requirements of the Clean Air Act, as amended, 42 USC 1857 et seq., the Federal Water Pollution Control Act, as amended, 33 USC 1251 et seq., and the regulations of the Environmental Protection Agency with respect thereto, at 40 CFR Part 15, as amended.

In addition to the foregoing requirements, all nonexempt contractors and subcontractors shall furnish to the owner, the following:

A. A stipulation by the Contractor or subcontractors, that any facility to be utilized in the performance of any nonexempt contract or subcontract, is not listed on the List of Violating Facilities issued by the Environmental Protection Agency (EPA) pursuant to 40 CFR Part 15, as amended.

B. Agreement by the Contractor to comply with all the requirements of Section 114 of the Clean Air Act, as amended, (42 USC 1857 c-8) and Section 308 of the Federal Water Pollution Control Act, as amended, CDBG-DR-INFR Procurement Policies and Procedures
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(33 USC 1318) relating to inspection, monitoring, entry, reports and information, as well as all other requirements specified in said Section 114 and Section 308, and all regulations and guidelines issued thereunder.

C. A stipulation that as a condition for the award of the contract, prompt notice will be given of any notification received from the Director, Office of Federal Activities, EPA, indicating that a facility utilized, or to be utilized for the contract, is under consideration to be listed on the EPA List of Violating Facilities.

D. Agreement by the Contractor that he will include, or cause to be included, the criteria and requirements in paragraph (1) through (4) of this section in every nonexempt subcontract and requiring that the Contractor will take such action as the government may direct as a means of enforcing such provisions.

10. FLOOD DISASTER PROTECTION
Any contract is subject to the requirements of the Flood Disaster Protection Act of 1973 (P.L. 93-234).

Nothing included as a part of the contract is approved for acquisition or construction purposes as defined under Section 3(a) of said Act, for use in an area identified by the Secretary of HUD as having special flood hazards which is located in a community not then in compliance with the requirements for participation in the National Flood Insurance Program pursuant to Section 201(d) of said Act; and the use of any assistance provided under the contract for such acquisition for construction in such identified areas in communities then participating in the National Flood Insurance Program shall be subject to the mandatory purchase of flood insurance requirements or Section 102(a) of said Act.

Any contract or agreement for the sale, lease, or other transfer of land acquired, cleared or improved with assistance provided under any Contract shall contain, if such land is located in an area identified by the Secretary as having special flood hazards and in which the sale of flood insurance has been made available under the National Flood Insurance Act of 1968, as amended, 42 U.S.C. 4001 et seq., provisions obligating the transferee and its successors or assigns to obtain and maintain, during the ownership of such land, such flood insurance as required with respect to financial assistance for acquisition or construction purposes under Section 102(a) of Flood Disaster Protection Act of 1973.

11. ACCESS TO RECORDS - MAINTENANCE OF RECORDS
The State of California, the Department of Housing and Urban Development, the Comptroller General of the United States, or any of their duly authorized representatives, shall have access to any books, documents, papers and records of the Contractor which are directly pertinent to this specific contract, for the purpose of audits, examinations, and making excerpts and transcriptions. All records connected with any contract will be maintained in a central location by the unit of local government and will be maintained for a period of five (5) years from the official date of the State's final closeout of the grant.

12. INSPECTION
The authorized representative and agents of the State of California and the Department of Housing and Urban Development shall be permitted to inspect all work, materials, payrolls, records of personnel, invoices of materials, and other relevant data and records.

13. REPORTING REQUIREMENTS
The Contractor shall complete and submit all reports, in such form and according to such schedule, as may be required by the Owner.

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14. CONFLICT OF INTEREST
A. No officer or employee of the local jurisdiction or its designees or agents, no member of the governing body, and no other public official of the locality who his/her tenure or for one year thereafter, shall have any interest, direct or indirect, in any contract or subcontract, or the proceeds thereof, for work to be performed. Further, the Contractor shall cause to be incorporated in all subcontracts the language set forth in this paragraph prohibiting conflict of interest.

B. No member of or delegate to Congress, or Resident Commissioner, shall be admitted to any share or part of any contract or to any benefit that may arise therefrom, but this provision shall not be construed to extend to any contract if made with a corporation for its general benefit.

15. ACTIVITIES AND CONTRACTS NOT SUBJECT TO EXECUTIVE ORDER 11246, AS

AMENDED
(applicable to contracts and subcontracts of $10,000 and under) During the performance of any contract, the Contractor agrees as follows:

A. The Contractor shall not discriminate against any employee or applicant for employment because of race, color, religion, sex, or national origin. The Contractor shall take affirmative action to ensure that applicants for employment are employed, and that employees are treated during employment, without regard to their race, color, religion, sex, or national origin. Such action shall include, but not be limited to, the following: employment, upgrading, demotion, or transfer; recruitment or recruitment advertising; layoff or termination; rates of pay or other forms of compensation; and selection for training, including apprenticeship.

B. The Contractor shall post in conspicuous places, available to employees and applicants for employment, notices to be provided by Contracting Officer setting forth the provisions of this nondiscrimination clause. The Contractor shall state that all qualified applicants will receive consideration for employment without regard to race, color, religion, sex, or national origin.

C. Contractors shall incorporate foregoing requirements in all subcontracts.

16. PATENTS
A. The Contractor shall hold and save the Owner and its officers, agents, servants, and employees harmless from liability of any nature or kind, including cost and expenses for, or on account of any patented or unpatented invention, process, article, or appliance manufactured or used in the performance of the contract including its use by the Owner, unless otherwise specifically stipulated in the Contract Document.

B. License or Royalty Fees: License and/or Royalty Fees for the use of a process which is authorized by the Owner of the project must be reasonable, and paid to the holder of the patent, or his authorized license, direct by the Owner and not by or through the Contractor.

C. If the Contractor uses any design device or materials covered by letters, patent or copyright, he shall provide for such use by suitable agreement with the owner of such patented or copy-righted design device or material. It is mutually agreed and understood, that without exception the contract prices shall include all royalties or costs arising from the use of such design, device or materials, in any way involved in the work. The Contractor and/or his Sureties shall indemnify and save harmless the Owner of the project from any and all claims for infringement by reason of the use of such patented or copy-righted design, CDBG-DR-INFR Procurement Policies and Procedures
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June 2023
device or materials or any trademark or copy-right in connection with work agreed to be performed under this contract, and shall indemnify the Owner for any cost, expense, or damage which it may be obliged to pay by reason of such infringement at any time during the prosecution of the work or after completion of the work.

17. COPYRIGHT
No materials, to include but not limited to reports, maps, or documents produced as a result of this contract, in whole or in part, shall be available to the Contractor for copyright purposes. Any such materials produced as a result of any contract that might be subject to copyright shall be the property of the Owner and all such rights shall belong to the Owner.

18. TERMINATION FOR CAUSE
If, through any cause, the Contractor shall fail to fulfill in a timely and proper manner his obligations under this contract, or if the Contractor shall violate any of the covenants, agreements, or stipulations of this contract, the Owner shall thereupon have the right to terminate any contract by giving written notice to the Contractor of such termination and specifying the effective date thereof, at least five (5) days before the effective date of such termination. In such event, all finished or unfinished documents, data, studies, surveys, drawings, maps, models, photographs, and reports prepared by the Contractor under any contract shall, at the option of the Owner, become the Owner’s property and the Contractor shall be entitled to receive just and equitable compensation for any work satisfactorily completed hereunder.

Notwithstanding the above, the Contractor shall not be relieved of liability to the Owner for damages sustained by the Owner by virtue of any breach of the contract by the Contractor, and the Owner may withhold any payments to the Contractor for the purpose of set-off until such time as the exact amount of damages due the Owner from the Contractor is determined.

19. TERMINATION FOR CONVENIENCE
The Owner may terminate any contract at any time by giving at least ten (10) days’ notice in writing to the Contractor. If the contract is terminated by the Owner as provided herein, the Contractor will be paid for the time provided and expenses incurred up to the termination date.

20. ENERGY EFFICIENCY
The Contractor shall comply with mandatory standards and policies relating to energy efficiency which are contained in the state energy conservation plan issued in compliance with the Energy Policy and Conservation Act (Public Law 94-163).

21. SUBCONTRACTS
A. The Contractor shall not enter into any subcontract with any subcontractor who has been debarred, suspended, declared ineligible, or voluntarily excluded from participating in contacting programs by any agency of the United States Government or the State of California.

B. The Contractor shall be as fully responsible to the Owner for the acts and omissions of the Contractor’s subcontractors, and of persons either directly or indirectly employed by them, as he is for the acts and omissions of persons directly employed by the Contractor.

C. The Contractor shall cause appropriate provisions to be inserted in all subcontracts relative to the work to bind subcontractor to the Contractor by the terms of the contract documents insofar as applicable to the CDBG-DR-INFR Procurement Policies and Procedures
56 25
June 2023
work of subcontractors and to give the Contractor the same power as regards terminating any subcontract that the Owner may exercise over the Contractor under any provision of the contract documents.

D. Nothing contained in any contract shall create any contractual relation between any subcontractor and the Owner.

22. DEBARMENT, SUSPENSION, AND INELIGIBILITY
The Contractor represents and warrants that it and its subcontractors are not debarred, suspended, or placed in ineligibility status under the provisions of 24 CFR 24 (government debarment and suspension regulations).

23. BREACH OF CONTRACT TERMS
Any violation or breach of terms of any contract on the part of the Contractor or the Contractor’s subcontractors may result in the suspension or termination of the contract or such other action that may be necessary to enforce the rights of the parties of the contract. The duties and obligations imposed by the contract documents and the rights and remedies available thereunder shall be in addition to and not a limitation of any duties, obligations, rights and remedies otherwise imposed or available by law.

24. PROVISIONS REQUIRED BY LAW DEEMED INSERTED
Each and every provision of law and clause required by law to be inserted in any contract shall be deemed to be inserted herein and the contract shall be read and enforced as though it were included herein, and if through mistake or otherwise any such provision is not inserted, or is not correctly inserted, then upon the application of either party the contract shall forthwith be physically amended to make such insertion or correction.

25. CHANGES
The Owner may, from time to time, request changes in the scope of the services of the Contractor to be performed hereunder. Such changes, including any increase or decrease in the amount of the Contractor’s compensation which are mutually agreed upon by and between the Owner and the Contractor, shall be incorporated in written and executed amendments to this Contract.

26. PERSONNEL
The Contractor represents that it has, or will secure at its own expense, all personnel required in performing the services under this Contract. Such personnel shall not be employees of or have any contractual relationship with the Owner. All the services required hereunder will be performed by the Contractor or under its supervision, and all personnel engaged in the work shall be fully qualified and shall be authorized or permitted under State and local law to perform such services.

No person who is serving sentence in a penal or correctional institution shall be employed on work under any Contract.

27. ANTI-KICKBACK RULES
Salaries of personnel performing work under any Contract shall be paid unconditionally and not less often than once a month without payroll deduction or rebate on any account except only such payroll deductions as are mandatory by law or permitted by the applicable regulations issued by the Secretary of Labor pursuant to the "Anti-Kickback Act" of June 13, 1934 (48 Stat. 948; 62 Stat. 740; 63 Stat. 108; CDBG-DR-INFR Procurement Policies and Procedures
57 26
June 2023
Title 18 U.S.C. 874; and Title 40 U.S.C. 276c). The Contractor shall comply with all applicable "AntiKickback" regulations and shall insert appropriate provisions in all subcontracts covering work under the contract to insure compliance by the subcontractors with such regulations, and shall be responsible for the submission of affidavits required of subcontractors thereunder except as the Secretary of Labor may specifically provide for variations of or exemptions from the requirements thereof.

28. ASSIGNABILITY
The Contractor shall not assign any interest in any Contract, and shall not transfer any interest in the same (whether by assignment or novation) without prior written approval of the Owner provided that claims for money due or to become due the Contractor from the Owner under the Contract may be assigned to a bank, trust company, or other financial institution, or to a Trustee in Bankruptcy, without such approval.

Notice of any such assignment or transfer shall be furnished promptly to the Owner.

29. INTEREST OF CONTRACTOR
The Contractor covenants that he presently has no interest and shall not acquire any interest direct or indirect in the above described project or any parcels therein or any other interest which would conflict in any manner or degree with the performance of his services hereunder. The Contractor further covenants that in the performance of any Contract no person having any such interest shall be employed.

30. POLITICAL ACTIVITY
The Contractor will comply with the provisions of the Hatch Act (5 U.S.C. 1501 et seq.), which limits the political activity of employees.

31. COMPLIANCE WITH THE OFFICE OF MANAGEMENT AND BUDGET The parties agree to comply with the regulations, policies, guidelines, and requirements of the Office of Management and Budget, Circulars A-95, A-102, A-133, and A-54, as they relate to the use of Federal funds under any contract.

32. DISCRIMINATION DUE TO BELIEFS
No person with responsibilities in operation of the project to which this grant relates will discriminate with respect to any program participant or any applicant for participation in such program because of political affiliation or beliefs.

33. CONFIDENTIAL FINDINGS
All of the reports, information, data, etc., prepared or assembled by the Contractor under any Contract are confidential, and the Contractor agrees that they shall not be made available to any individual or organization without prior written approval of the Owner.

34. LOBBYING
The Contractor certifies, to the best of his or her knowledge and belief that:

1. No federally appropriated funds have been paid or will be paid, by or on behalf of the contractor, to any person for influencing or attempting to influence an officer or employee of any agency, a member of Congress, an officer or employee of Congress, or an employee of a member of Congress in connection CDBG-DR-INFR Procurement Policies and Procedures
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with the awarding of any federal contract, the making of any federal grant, the making of any federal loan, the entering into of any cooperative agreement, and the extension, continuation, renewal, amendment, or modification of any federal contract, grant, loan, or cooperative agreement.

2. If any funds other than federally appropriated funds have been paid or will be paid to any person for influencing or attempting to influence an officer or employee of any agency, a member of Congress, an officer or employee of Congress, or an employee of a member of Congress in connection with this federal contract, grant, loan, or cooperative agreement, the contractor shall complete and submit Standard FormLLL, "Disclosure Form to Report Lobbying," in accordance with its instructions.

35. AUTHORIZATION
This Agreement is authorized by the _[name of GRANTEE] , Resolution [number] adopted [date], copies of which are attached hereto and made a part hereof.

ATTEST:
___________________________ [name of GRANTEE]
By:________________________________
___________________________ [name & title of GRANTEE Representative] Date: ______________________________
[name of CONSULTANT]
___________________________ By:___________________________________ [name & title of CONSULTANT Representative]
___________________________ Date: _________________________________ CDBG-DR-INFR Procurement Policies and Procedures
59 10. a. Name and Address of Lobbying Registrant:

9. Award Amount, if known:
$
* Street 1
* City State Zip
Street 2
* Last Name
Prefix * First Name Middle Name
Suffix

DISCLOSURE OF LOBBYING ACTIVITIES
Complete this form to disclose lobbying activities pursuant to 31 U.S.C.1352 OMB Number: 4040-0013 Expiration Date: 02/28/2025

1. * Type of Federal Action:
a. contract
b. grant
c. cooperative agreement
d. loan
e. loan guarantee
f. loan insurance

2. * Status of Federal Action:
a. bid/offer/application
b. initial award
c. post-award

3. * Report Type:
a. initial filing
b. material change

4. Name and Address of Reporting Entity:

Prime SubAwardee
* Name
* Street 1 Street 2
* City State Zip
Congressional District, if known:

5. If Reporting Entity in No.4 is Subawardee, Enter Name and Address of Prime:

6. * Federal Department/Agency: 7. * Federal Program Name/Description:

CFDA Number, if applicable:

8. Federal Action Number, if known:
b. Individual Performing Services (including address if different from No. 10a) Prefix * First Name Middle Name
* Street 1
* City State Zip
Street 2

11. Information requested through this form is authorized by title 31 U.S.C. section 1352. This disclosure of lobbying activities is a material representation of fact upon which reliance was placed by the tier above when the transaction was made or entered into. This disclosure is required pursuant to 31 U.S.C. 1352. This information will be reported to the Congress semi-annually and will be available for public inspection. Any person who fails to file the required disclosure shall be subject to a civil penalty of not less than $10,000 and not more than $100,000 for each such failure. * Last Name Suffix
* Signature:

Completed on submission to Grants.gov
Completed on submission to Grants.gov
*Name: Prefix * First Name Middle Name
* Last Name Suffix
Title: Telephone No.: Date:

Federal Use Only: Authorized for Local Reproduction
Standard Form - LLL (Rev. 7-97)
60 PROJECT SCOPE OF WORK (REVISION 1)
Complete engineering services with attention to
1 individual client needs
The proposed project Scope of Work is well-defined in the RFQ&P document. Our proposed Scope of Work generally follows the scope presented in the RFQ&P with a few deviations that are discussed hereinafter.

Below is our proposed Scope of Work:

Task 1: Project Management
Project management activities, including contract management and quality control services, will be performed on an ongoing basis throughout the duration of the project. These tasks are not necessarily discrete tasks to be estimated separately but are to be included in the overall time allocated to PACE’s project management. Below are the discrete tasks:

1. Prepare internal project management plan.

2. Coordinate all meetings, including preparing and submitting an agenda and meeting minutes.

3. Coordination and consultation with local, state, and federal agencies as required.

4. Prepare and submit project schedules and schedule updates.

5. Prepare and submit monthly progress reports with monthly progress payment requests as requested in the RFQ&P.

6. Prepare and adhere to the approved Quality Assurance/Quality Control (QA/QC) Program.

7. Maintain project files.

Project management is defined as the process and activity of planning, organizing, motivating, and controlling resources, procedures, and protocols to achieve specific project goals. The City has established the project goals, Scope of Services, and deliverables. It is up to PACE to meet these constraints within budget and schedule.

Our project management style will meet project goals by establishing clear lines of communication between the City and PACE. Communication is key to ensure that the Project Manager (Steven Wilson, S.E.) understands what the City desires. Once the Project Manager is confident that he understands the City’s expectations, the PACE team will proceed with project planning and execution. This proposal presents the first pass at developing a clear line of communication between the responsible engineers and planners to meet the established goals, Scope of Services, and deliverables within the timetable and fee. 61 PROJECT SCOPE OF WORK (REVISION 1)
Complete engineering services with attention to
2 individual client needs
PACE will accomplish this by providing the Project Manager with authority to assign organizational resources to project activities. In addition, PACE provides high-quality professional engineering services through the establishment of a rigorous and detailed QA/QC Program that ranges from continued staff training to a step-by-step project delivery system. All Project Managers are trained and responsible for project oversight and QA/QC, performing quality review of all projects. As the project progresses, changes will undoubtedly be presented for consideration. PACE takes pride in being able to change plans to accommodate updated goals while still delivering the required product on time and within the constraints originally established.

The City’s Scope of Services includes submittal of several preliminary and draft deliverables that will provide review and comments from the City, which is desirable from PACE’s perspective. We have developed a comprehensive QA/QC Program that began in 1976 at the inception of the company and continuesto evolve as our profession advances into the future.

Our QA/QC Program is composed of the following elements:

1. Continued training for all staff, including Professional Services Management Journal (PSMJ)-facilitated project management training.

2. Established design standards.

3. Updated drafting and CAD standards.

4. Project delivery system.

5. Knowledge library.

6. Extensive and current design and technical resources.

7. Design checklists.

8. Checklist verification.

9. Senior and/or principal level work checks throughout project delivery.

All projects are managed by an experienced and seasoned engineer who oversees all phases of a project from inception to completion. The QA/QC Manager and Principal-in-Charge (Paul J. Reuter, P.E.) will provide quality review during all stages of the project.

PACE has developed extensive design standards, drafting standards, and project delivery systems resulting in greater consistency throughout the firm, which ensures a better product for our clients.

PACE has an extensive library of technical resources that we rely on for resolving complex technical issues along with product information manuals. When problems occur or lessons are learned, the solutions to those problems are added to our library and distributed amongst our employees to avoid repetition.

QA/QC reviews are conducted in-house by QA/QC staff to catch mistakes, errors, or omissions contained in client deliverables as well as to make sure they are corrected. Documents are reviewed during all stages of the project to ensure delivery of accurate information. PACE believes our structure and effort put forth enables our team to provide their best product in the best interests of the client.

Task 1 Deliverables
• Monthly progress reports with progress payment requests. • Meeting agendas and minutes.
62 PROJECT SCOPE OF WORK (REVISION 1)
Complete engineering services with attention to
3 individual client needs
The RFQ&P provides the City’s anticipated schedule for the project, which identified completion of the plans, specifications and estimates (PS&E) within approximately 28 months of being issued a contract (September 2025 to December 2027). PACE’s Project Manager will secure the staff and resources needed to meet this schedule. Figure 2 below is an anticipated project schedule.

Figure 2 – Preliminary Project Schedule Through Design Completion Task 2: Preliminary Engineering Design Services
Preliminary engineering design services include the following subtasks:

Subtask 2.1 Surveying and Mapping
PACE’s survey crew will map the proposed raw water tank site and surrounding area (approximately one acre) as well as the anticipated water service pipeline from the Centimudi Tank site to Fisherman’s Point (approximately 0.5 miles). Survey methodology will utilize a combination of conventional equipment and low-altitude drone, which will produce a topographic surface map with ±0.5-foot accuracy. The drone will also produce a high-resolution, orthorectified image that will be utilized as a background for final plans. The drone allows us to map the project area in a fraction of the time and pass the savings onto the City. Mapping with 1-foot contour intervals will be prepared for design purposes.

Mapping will be prepared based on California Coordinate System of 1983 (CCS83), and elevations will be based on North American Vertical Datum of 1988 (NAVD88).

Several durable mapping control points will be set around the project site, which can be utilized for construction staking services during construction of the project.

Subtask 2.2 Existing Project Data/Information Review
PACE is very familiar with the project background having participated in raw water tank analysis.

However, other PACE team members are not as familiar. This task is utilized for all PACE team members to familiarize themselves with important aspects of the project.

Subtask 2.3 Existing Water System and WTP Evaluation and Review This task will include evaluation of all existing relevant utility (water piping, tank layout, potable water service connections, transmission and sludge pipeline alignments between the WTP and Centimudi Tank, storm drains, and electrical power) infrastructure to determine needed improvements to facilitate the design effort.

Finally, the City’s supervisory control and data acquisition (SCADA) system will be evaluated to establish requirements for (1) modifying the existing system and (2) incorporating the proposed tank into the City’s SCADA system. PACE’s Instrumentation and Controls (I/C) Engineers have been working with City staff for the last several years assisting with SCADA-related repairs and enhancements. 63 PROJECT SCOPE OF WORK (REVISION 1)
Complete engineering services with attention to
4 individual client needs
Subtask 2.4 Feasibility Study – Concrete Versus Welded Steel The City desires the selected consultant to perform a feasibility study and alternatives analysis comparing the 20- and 50-year present worths for a prestressed concrete versus a welded steel storage tank. PACE has designed countless welded steel water tanks since the mid-1970s, including a handful of bolted steel tanks. While steel tanks have been the “go-to” option for the last several years, concrete tanks are starting to gain momentum in the water works industry, especially as steel prices have continued to rise.

Working with several of the prominent prestressed concrete and welded steel tank manufacturers, we will prepare a life cycle cost analysis considering the following:
• Upfront total project cost.
• Welded steel tank ongoing coating maintenance costs and intervals. • Welded steel tank recoating costs and intervals, including project soft costs. • Concrete tank inspection and routine maintenance costs and intervals. • Concrete tank power washing costs and intervals.

PACE performed a similar study for the Centimudi Tank Project and has done this type of analysis for Bella Vista Water District (BVWD), WCSD, and the communities of Westwood and Clear Creek in Lassen County.

Subtask 2.5 Review Chlorine Contact Time & Evaluation Alternatives PACE will confirm our assumptions and finalize our preliminary evaluation of the chlorine CT issues related to the relocation of the potable water storage tank from the WTP to the Centimudi Tank site.

Additionally, PACE will work with the City to develop and agree on potential alternatives to investigate that may achieve acceptable chlorine CT. Potential alternatives may include a new water service pipeline from Centimudi Tank to Fisherman’s Point, utilizing the City’s existing 0.14 MG raw water tank in some manner for additional CT volume, keeping one or both of the City’s existing treated water tanks while constructing the new raw water tank in the same location of the City’s existing 0.14 MG raw water tank, or adding additional piping between the WTP and Fisherman’s Point for additional CT volume.

PACE will evaluate the alternatives to determine the recommended solution to achieve the acceptable chlorine CT to the three critical potable water services downstream of the WTP (Shasta Dam, Fisherman’s Point, and the Centimudi boat ramp).

Subtask 2.6 Geotechnical Evaluation
PACE will retain the services of KC Engineering Company (KC), Redding, California, to perform a geotechnical evaluation at the proposed tank site. KC’s full proposal is included at the end of this Statement of Qualifications and Proposal (SOQ&P) but, in general, the Scope of Work is as follows:
• Literature review.
• Site reconnaissance.
• Surface and subsurface exploration consisting of drilling five borings in accordance with American Concrete Institute (ACI) guidelines. During drilling, it is assumed that the City will hydrovac the upper 4 feet and have water available for the driller. • Laboratory testing for the following: Moisture/Density, sieve analysis, Atterberg limits, strength testing, consolidation, R-value, and soil corrosivity.
• Analysis and Report: A geotechnical report will provide recommendations for compliance with 2022 California Building Code (CBC) seismic criteria, pad and roadway grading, tank 64 PROJECT SCOPE OF WORK (REVISION 1)
Complete engineering services with attention to
5 individual client needs
foundations, pavement sections, drainage, and other related design criteria. The report will also address geotechnical or geologic concerns on the site and any required mitigation measures such as lime treatment and/or subsurface ground improvement. • Consultation and Plan Review: KC will provide assistance and input throughout the design process and review final plans for conformance with the geotechnical report. A plan review letter will be provided for submittal to the City.

Note: The RFQ&P suggests a preliminary geotechnical investigation be performed in Task 2 and a final geotechnical investigation be performed in Task 4. We intend to complete the final geotechnical investigation in Task 2 because we will need the final geotechnical results to estimate foundation needs and subsequent cost estimates in Task 2.6. The scope of the geotechnical investigation will be suitable for a prestressed concrete or welded steel tank.

Subtask 2.7 Preliminary Design Technical Memorandum
PACE will prepare a preliminary design technical memorandum that includes preliminary design calculations, preliminary plans, preliminary engineer’s project cost estimate, and other appropriate preliminary engineering work. Preliminary project plans will be presented at 50% scale, reduced from 22-inch by 34-inch plan sheets. A draft report will be submitted to City staff and other project stakeholders (if applicable) for review and comment prior to finalizing the report.

Task 2 Deliverables
• Technical memorandum containing the following:
o Recommendation of tank type (prestressed concrete versus welded steel). o Recommendation of selected alternative to achieve acceptable chlorine CT. o 30% preliminary plans, including engineer’s estimate. o Draft geotechnical report.
o Discussion of project design parameters and other appropriate engineering work.

Task 3: Environmental Compliance and Permitting Services PACE will retain the services of ENPLAN, Redding, California, to perform all necessary environmental compliance and permitting responsibilities for the project. ENPLAN’s environmental study area is anticipated to include all proposed improvements on the WTP site as well as potential waterline corridor along Lake Boulevard between the new Centimudi Tank and the existing service connection to the Fisherman’s Point and the potential waterline between Lake Boulevard and the raw water tank site. In addition to areas of proposed improvements, the study area will include sufficient area for construction, temporary construction access roads, and staging areas. Prior to starting work, ENPLAN will consult with the City and applicable federal agencies, including HUD/CDBG, USBR, and USFS regarding the specific requirements for technical studies and coordination of NEPA review. If acceptable to the federal agencies, a multi-jurisdictional cooperative agreement or similar document will be prepared to streamline NEPA review. ENPLAN’s full proposal is included at the end of this SOQ&P but, in general, the Scope of Work is as follows:
• Agency coordination and meetings.
• Biological studies to include pre-field research, botanical field survey, wildlife field survey, and preparation of a biological study report.
65 PROJECT SCOPE OF WORK (REVISION 1)
Complete engineering services with attention to
6 individual client needs
• Aquatic resource evaluation to include pre-field research, field evaluation, acreage calculations, reporting, resource agency permit assistance. This task will include:
o Section 404 Permit Application.
o Section 401 Water Quality Certification Application.
o Section 1600 Streambed Alteration Agreement.
• Cultural resources study to include records search, agency and tribal contact, field survey, report preparation, and State Historic Preservation Officer (SHPO) consultation. • California Environmental Quality Act (CEQA) documentation. • NEPA documentation for review by HUD/CDBG, USBR, and USFS.

Task 3 Deliverables
• Task 3 deliverables will be provided in accordance with the requirements set forth in the RFQ&P:
o Environmental documentation.
o Technical studies and surveys.
o Permit applications.

It is understood that if the actual environmental document, study, permit, agreement, and activity requirements are determined to be different than what was stated in the RFQ&P, a modification to the environmental scope and consultant fee will be negotiated as necessary. Additionally, it is understood that the City will be responsible for payment of all agency permit fees and will obtain any appropriate City permits.

Task 4: Plans, Specifications, and Estimates (Final Design) Services PACE will utilize our in-house disciplines of Civil, Water, Structural, Mechanical, Electrical, and I/C Departments to prepare final design documents (construction plans, technical specifications, and cost estimates) suitable for public bidding. The City will prepare upfront bidding and contract documents. The final design effort will be based on the City-approved recommendations from the preliminary design technical memorandum, completed in Task 2, and generally reflect the following:
• Coordination with existing utility owners, including the City’s electrical provider. The City owns the water infrastructure in the vicinity, and we have Record Drawings for a majority of those improvements.
• Integration of any CEQA/NEPA and USFS mitigation and/or Use Permit mitigation requirements. • Project sequencing and timing, including demolition of the existing tanks and pipelines and new pipeline installation and tie-ins will clearly be identified to ensure that the WTP facilities are kept in service to the maximum extent possible.
• Complete 60%, 90%, and 100% design submittals (plans and cost estimates) for City and agency review. The plan set will include site and utility plans along with larger-scale mechanical plans, sections, and details. Civil, structural, electrical, and I/C plan sheets will be grouped within the plan set.
• Technical specifications will be provided in Construction Specification Institute (CSI) format. • Review of final compiled City-provided front end contract specifications, general contract provisions, and bid-item proposal.
66 PROJECT SCOPE OF WORK (REVISION 1)
Complete engineering services with attention to
7 individual client needs
Task 4 Deliverables
• Task 4 deliverables will be provided in accordance with the requirements set forth in the RFQ&P:
o Final geotechnical report.
o 60% construction plans and cost estimates.
o 90% construction plans, technical specifications, and cost estimates. o 100% construction plans, technical specifications, and cost estimates.

Task 5: Assistance During Bidding and Construction
Task 5 consists of providing limited engineering services during bidding, construction, and construction close-out phases of the project. Specific tasks that are NOT requested in the RFQ&P are as follows:
• Assistance with bid advertisement.
• Assistance with bid opening, bid evaluation, recommendation of award, and contract execution. • Construction observation.
• Periodic site reviews by the Engineer of Record (EOR). • Special inspections required by CBC.
• Coating inspections.
• Materials testing, such as compaction, concrete, etc. • Functional acceptance testing (FAT).
• Recommendation of project acceptance.

PACE routinely provides these services for our municipal client base, especially for similar projects.

However, the RFQ&P does not specifically request these services, so they are not included in our proposed Scope of Work. However, any portion of all or some of these services can be added at a later date. Specific subtasks we intend to provide under Task 5 are described hereinafter:

Subtask 5.1 Bidding Services
PACE will attend a pre-bid meeting at the City and present the project to prospective bidders along with key project considerations. A sign-in sheet will be prepared, and PACE will note questions asked along with responses provided during the meeting for inclusion in a subsequent addendum.

It is assumed questions from bidders will be directed to City staff since PACE will not be involved in the bid advertisement aspects of the project. PACE will take directives from City staff on required changes to the bid documents and prepare addendums, as needed, to clarify bidding requirements. Addendums will be distributed to City staff for distribution to bidders.

Subtask 5.2 Construction Engineering
Prior to construction, PACE will attend a preconstruction conference with the selected contractor to discuss project specifics and important aspects related to project implementation. PACE will work with City staff prior to the meeting in order to establish an inclusive agenda that touches on key aspects of the project.

PACE will review the contractor’s submittals for key materials and equipment for the project, including the tank manufacturer’s engineered plans and shop drawings and detailed engineering calculations. 67 PROJECT SCOPE OF WORK (REVISION 1)
Complete engineering services with attention to
8 individual client needs
Our fees are based on needing no more than two submittal reviews for submitted materials, equipment, shop drawings, and engineered calculations.

PACE will assist City staff with negotiating and processing contract change orders (CCOs) during construction. Since PACE’s presence during construction is expected to be limited, we assume we will work directly with City staff to prepare documents memorializing any changes. Our estimated fees for this effort are based on a reasonable number of corrective-type change orders that we have experienced on recent similar projects. It does not take into account owner-requested change orders that, in our experience, can have quite a range of complexity and work requirements.

PACE will assist City staff with responding to requests for information (RFIs) that are directed to City staff. Again, we assume City staff will take the lead in the construction management effort and PACE will support their efforts as needed. RFI processing can range significantly on a project and is highly dependent on the contractor’s experience and general litigious nature. For our fee estimate, we have assumed processing up to fifteen RFIs.

PACE will attend two final inspections for the project. The first inspection will be after substantial completion but prior to final completion, and we will note items to include on the project punch list.

The last and final inspection will occur after all noted punch list items are completed.

PACE will prepare Record Drawings based on markups from the Contractor and Resident Engineer in accordance with requirements set forth in the RFQ&P.

Task 5 Deliverables
• Addendums.
• Submittal review comments.
• CCOs.
• Responses to RFIs.
• Noted punch list items.
• Record Drawings.
68 Client: City of Shasta Lake
Project: Raw Water Storage Tank Engineering Design Services and Services During Construction Date: September 5, 2025
Job No: 0.04
S. Wilson
Senior Engr
P. Reuter
Managing
Engr
Senior
Engr/Surv
Associate
Engineer/Surv
Staff
Engr/Surv 3
Staff
Engr/Surv 2
Staff
Engr/Surv 1
J. Lenaker
Survey Sup
Two-Person
Survey Crew
One-Person
Survey Crew
Engr/Survey
Technician 4
Engr/Survey
Technician 2 Admin Clerk Category Subtotal
E5/LS5 E7 E5/LS5 E4/LS4 E3/LS3 E2/LS2 E1/LS1 E6/LS6 PW2M PW1M T4 T2 AD2 1 PROJECT MANAGEMENT

1.1 Coordinate Meeting Agendas and Minutes 30 20 $ 12,720

1.2 Ongoing Project Coordination and Consultation 40 10 $ 12,360

1.3 Project Schedules and Updates 30 $ 7,200

1.4 Monthly Progress Reports (assume 28) 30 6 $ 8,856

1.5 Ongoing Project QA/QC 40 28 $ 17,328

1.6 Maintenance of Project Files 26 8 28 $ 13,572
Project Management Subtotal: 196 72 0 0 0 28 0 0 0 0 0 0 0 $ 72,036 2 PRELIMINARY ENGINEERING DESIGN SERVICES

2.1 Surveying and Mapping 4 1 12 18 10 20 32 $ 26,332

2.2 Existing Project Data/Information Review 12 12 12 $ 8,388

2.3 Existing Water System and WTP Evaluation and Review 8 8 16 12 16 $ 13,476

2.4 Feasibility Study - Concrete vs. Welded Steel Tank 32 6 40 4 $ 17,020

2.5 Review Chlorine Contact Time and Evaluation of Alternatives 16 20 12 40 40 $ 27,320

2.6 Geotechnical Evaluation $ 43,905
Geotechnical Coordination/Evaluation/Interpretation/Review 12 12 $ 5,076

2.7 Prepare Preliminary Design Technical Memorandum 20 20 20 12 100 12 6 $ 39,842 Preliminary Engineering Design Services Subtotal: 104 67 60 42 140 120 0 10 20 0 44 0 10 $ 181,359 3 ENVIRONMENTAL SERVICES

3.1 Environmental Compliance and Permitting Services $ 142,907 Environmental Coordination and Support 36 6 24 2 $ 14,870 Environmental Services Subtotal: 36 6 0 0 0 24 0 0 0 0 0 0 2 $ 157,777 4 FINAL DESIGN SERVICES

4.1 Civil Design 3 17 89 6 $ 22,720

4.2 Structural Design 80 160 40 12 $ 56,892

4.3 Water Design - Tank 9 20 149 8 $ 36,918

4.4 Water Design - Service Main 8 16 194 8 $ 44,412

4.5 Electrical Design 8 24 60 20 8 $ 22,088

4.6 I/C Design 8 32 60 20 8 $ 23,808
Final Design Services Subtotal: 80 20 69 56 432 280 40 0 0 0 40 0 50 $ 206,838 5 ASSISTANCE DURING BIDDING AND CONSTRUCTION

5.1 Pre-Bid Conference 8 8 $ 3,384

5.2 Assist with RFIs During Bidding 12 4 8 6 6 $ 7,966

5.3 Addendum Preparation 8 2 8 6 6 8 $ 8,244

5.4 Pre-Construction Conference 4 6 $ 2,058

5.5 Submittal Review 16 4 16 8 22 22 $ 18,798

5.6 Assist with CCOs and RFIs 12 4 8 8 8 16 $ 12,104

5.7 Final Inspection (assume two site visits) 8 4 8 4 $ 5,804

5.8 Record Drawings 8 24 30 30 $ 17,556
Assistance During Bidding and Construction Subtotal: 76 18 40 34 60 94 0 0 0 0 38 0 0 $ 75,914 492 183 169 132 632 546 40 10 20 0 122 0 62 2,408
$ 240 $ 276 $ 240 $ 215 $ 194 $ 183 $ 165 $ 261 $ 494 $ 359 $ 183 $ 149 $ 91 N/A $ 118,080 $ 50,508 $ 40,560 $ 28,380 $ 122,608 $ 99,918 $ 6,600 $ 2,610 $ 9,880 $ - $ 22,326 $ - $ 5,642 $ 693,924 Total Person-Hours:

Labor Cost Per Hour:

Labor Cost Per Classification:

EXHIBIT A

PERSON-HOUR BREAKDOWN AND FEE ESTIMATE
Task Description
(Subconsultant: KC Engineering Company/Materials Testing, Inc. (MTI), Redding, CA) (Subconsultant: ENPLAN, Redding, CA)
69 70
1 PO BOX 777 | 4477 Main Street
Shasta Lake, CA 96019
(530) 275-7400
www.cityofshastalake.gov
September 16, 2025

ELECTRONIC SUBMITTAL ONLY
Shasta County Board of Supervisors
1450 Court Street, Suite 308B
Redding, CA 96001
[email protected]
Re: Support for the Continuation of the Shasta County Commission on Aging Dear Chair and Members of the Board of Supervisors,
On behalf of the City of Shasta Lake, I am writing to express our strong support for the continuation of the Shasta County Commission on Aging (COA) and to respectfully request that the Board postpone any action on its possible dissolution.

I had the opportunity to review the Board of Supervisors’ agenda for Tuesday, August 26, 2025. Item R4 addresses the Commission on Aging and the discussion of its possible decommissioning. While the City recognizes that the COA is an advisory body, moving forward with such a significant decision at this time would be premature.

The COA has a long history of providing valuable insight on issues affecting older adults throughout Shasta County. With our senior population continuing to grow, the COA’s role in identifying needs, advising on services, and serving as a direct link between older residents and the County is more important now than ever. Our City’s COA representative Kristie Matthews regularly provides updates to the City Council and solicits feedback on pressing issues impacting our senior community. This two-way communication ensures that local perspectives are brought forward to inform County decisions.

While the staff report references other entities such as the PSA 2 Area Agency on Aging, the Older Adult Policy Council, and the Local Master Plan on Aging, it is important to recognize that the Board established the Commission on Aging more than 48 years ago precisely because there was an unmet need requiring a dedicated advisory body. What has changed? It is certainly not that our seniors need fewer resources or less support.

Postponing this decision will allow the County, the cities, and stakeholders, including the City Council of Shasta Lake, the opportunity to work collaboratively in exploring alternatives that preserve the vital advocacy role of the COA.

We urge the Board of Supervisors to maintain the Commission on Aging and to engage with partners to identify sustainable solutions that allow this important advisory body to continue serving our older adult population.
71 2
Thank you for your thoughtful consideration of this matter and for your ongoing commitment to the wellbeing of Shasta County’s seniors.

Very truly yours,

CITY OF SHASTA LAKE

PAMELYN ANNE MORGAN
Mayor
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STAFF REPORT
BOARD MEETING DATE: August 26, 2025
CATEGORY: Regular Calendar 4
SUBJECT: Receive a presentation from the Health and Human Services Agency regarding the Commission on Aging (“Commission”) and either: (1) designate authority to the County Executive Officer, and direct staff, to take the actions necessary to decommission the Commission; or (2) provide alternative direction to staff.

DEPARTMENT: Health and Human Services Agency-Behavioral Health and Social Services SUPERVISORIAL DISTRICT #: All
DEPARTMENT CONTACT: Bailey Cogger, HHSA Deputy Branch Director-Behavioral Health and Social Services, (530) 229-5900
STAFF REPORT APPROVED BY: Cindy Lane, HHSA Branch Director-Behavioral Health and Social Services Vote Required?
Simple Majority Vote
General Fund Impact?
No Additional General Fund Impact

RECOMMENDATION
Receive a presentation from the Health and Human Services Agency regarding the Commission on Aging (“Commission”) and either: (1) designate authority to the County Executive Officer, and direct staff, to take the actions necessary to decommission the Commission; or (2) provide alternative direction to staff.

DISCUSSION
The Commission, established by Board Resolution No. 77-284 and restructured under Resolution No. 88-052, serves as the County’s official advisory body on issues affecting older adults. Comprising eight members—five appointed by the Board of Supervisors and one appointed by each incorporated city—members serve staggered two-year terms, with bylaws allowing alternates for each seat.

The COA studies, evaluates, and makes recommendations to the Board and to the PSA 2 Area Agency on Aging, which serves Shasta, Lassen, Modoc, Siskiyou, and Trinity Counties, and is responsible for identifying senior needs, coordinating services, and administering program funding. The Shasta County Health and Human Services Agency, Behavioral Health and Social Services Branch (HHSA-BHSS), currently provides approximately 5 hours per month of clerical support to the COA. The COA has requested $20,000 in annual funding, plus additional resources of IT support, virtual meeting capabilities, secure document storage, event materials, and travel reimbursement, current fiscal constraints prevent HHSA-BHSS, and possibly other County Departments, from meeting these requests. In its June 17, 2025, presentation to the Board of Supervisors, the COA stated that if HHSA-BHSS cannot meet its budget requests, it is requesting the Board consider abolishing the COA. The COA is not required by law in every California county, and should the Board choose to decommission the COA, other entities such as the PSA 2 Area Agency on Aging, the Older Adult Policy Council, and the Local Master Plan of Aging would continue to advocate for older adults. Approving the COA’s budget request and/or additional County resources could also set a precedent requiring the County to provide similar financial support to other commissions and boards.

ALTERNATIVES
The Board could decline to receive the presentation or defer the presentation to a later date. If the Board chooses to provide a budget and/or additional County resources to the Commission on Aging, there would be a General Fund Impact. This action could also create the desire of other boards and commissions to request a budget and County resources for their use which would further increase the General Fund Impact.

OTHER AGENCY INVOLVEMENT
73

Page 2 ends

The recommendation has been reviewed by the County Administrative Office.

FISCAL IMPACT
There is no additional General Fund impact associated approving the recommendation. If the Board chooses to provide a budget and/or additional County resources to the Commission on Aging, there would be a General Fund Impact. In which case HHSA’s Social Services Administration Budget (BU 501) would need to bring back a budget amendment for the Board’s approval. If a budget is approved for the Commission on Aging, HHSA assumes other commissions would also come to the Board asking for a budget which could be a Future General Fund Impact.

ATTACHMENTS:
1: None
74 Report and Recommendations 8.2 Reviewed and Approved

City Manager

AGENDA ITEM
City Council
TO: Mayor and City Council Members
FROM: James Takehara, Electric Utility Director

DATE: August 13, 2025
SUBJECT: APPROVAL OF “THIRD PHASE AGREEMENT” WITH
NORTHERN CALIFORNIA POWER AGENCY (“NCPA”) TO

PURCHASE ENERGY STORAGE SERVICES FROM THE
“TROLLEY PASS PROJECT”
FILE NO.:

RECOMMENDATION:

Staff recommends the City Council adopt a resolution that approves the Third Phase Agreement (“Agreement”) with NCPA to facilitate the purchase of energy storage services from the “Trolley BESS” Project and that authorizes the City Manager or designee to sign and administer the Agreement on the City’s behalf.

BACKGROUND
As noted in previous staff reports, there are numerous state mandates and market conditions that are introducing new risks that could expose City electric rate payers to higher costs. The growing challenges in meeting the State’s renewable energy mandates, overall tight supply and demand conditions, and the expansion of the markets administered by the CA Independent System Operator (CAISO) are examples of significant events that are reshaping the electric wholesale markets. The attached contract with NCPA is intended to add resources to the City’s Electric portfolio to manage some of these risks. The contract would subscribe the City to a 5 MW share of the Trolley Pass Project, a battery energy storage system (BESS) with no associated generation.

The State’s renewable energy law is quite aggressive and is creating an absurd outcome.

Utilities must have 60% of its end-users’ electricity needs by 2030 using some form of renewable energy as defined by the State. If the City were to meet this mandate with solar only, the City would need to buy or build 68 MW of solar photovoltaic generation, even 75 though the City’s maximum electricity demand in all of history was only 38.3 MW. This type of excess is not consistent with traditional utility planning. While presenting a solaronly approach is intended to be illustrative only, there is a strong probability that solar will have a substantial role in meeting this mandate.

Staff has been surveying the market through joint procurement efforts through Joint Powers Agencies who have publicly solicited for renewable energy resources. What we’ve learned, or confirmed, is that some 99% of the resources under some level of development are: (a) solar, (b) stand alone battery, or (c) solar with integrated battery.

Even though Staff has sought to build a diversified energy supply portfolio, the only resources that developers are building is essentially the solar-only portfolio. Therefore, it is likely the City will have limited choices on power supply technology and must consider the types of risks that a solar-heavy portfolio may bring to Electric ratepayers.

To make matters more complicated, the influence of the CAISO is growing. Not only will CAISO markets govern 99% of new renewable energy resources under development today, their markets are being adopted throughout the Western US and are expected to cover City’s operations within 5 years. Below are some fundamental points about the CAISO organization and their markets:
• The CAISO is a not-for-profit corporation, became operational in 1998, and has operational control over 80% of the largest transmission lines in CA. Most CA electric consumers are under their umbrella, through their electric utility. • CAISO is governed by a 5-member board of governors who are appointed by the CA Governor and confirmed by the CA Senate.
• CAISO’s primary objective is to act as a grid operator balancing supply and demand while making sure all entities have equal access to the large powerlines that transport generation to consumers.
• The CAISO accomplishes their mission using wholesale electricity markets that clears transactions (buying and selling) in hourly and “sub-hourly” (i.e., 15-minute and 5-minute) increments.
• A utility operating under the CAISO must sell 100% of its resources into the CAISO markets then buy 100% of its consumption needs from the CAISO market. These transactions occur at the specific location where generation is injected onto the grid, and electricity is taken out of the grid to serve load. The utility’s net financial position could be positive, negative, or zero.
• CAISO produces these location-specific prices at over 3,200 locations and does so every 5-minutes.

Cost Risk: How A Solar-Heavy Portfolio and CAISO Markets Potentially Drive Up Costs The factors described above are likely to introduce new challenges and risks to the City’s electric operations. There are many, but for the purposes of the attached contract, the main issue is that of negative wholesale pricing.

Negative pricing is a nonintuitive phenomenon of the CAISO markets when there’s too much supply on the grid relative to demand at a given time. This can occur throughout the year, but this is more common in Spring when the following occur at the same time:
solar production is high around mid-day, electricity consumption is moderate (because Spring weather is moderate), and hydroelectric generation is high because the snow is 76 melting. These conditions often add up to a large supply relative to demand, which the CAISO attempts to correct by decreasing prices. When prices decrease, some producers will choose to reduce output and others may choose to shut down production. However, in certain conditions like the scenario above, low or even a zero price is not a strong enough price signal to ultimately balance supply and demand. So, the CAISO lets their price go negative. When prices are negative, a producer must pay to dispose of their generation output while a load serving entity receives payment for using it. Under today’s policies, CAISO prices can be -$0.25/kWh. City’s electric resources are exposed to such pricing under CAISO markets, which would translate to a wholesale cost that would cause upward rate pressure if left unmitigated.

In summary, there are two factors that are creating new risks of higher and substantial costs to Electric ratepayers: (1) renewable resources must produce electricity in order to help the City satisfy these State mandates, and (2) the CAISO markets that will govern these resources are volatile and can be negative (i.e., producers pay). Therefore, staff has started evaluating other tools for the electric portfolio to help insulate electric ratepayers from the potential negative cost impacts these changes may create.

Energy Storage Can Help Offset These Risks
The main purpose of the attached “Third Phase Agreement for the Trolley Pass Project” is to help reduce these risks. City can avoid the impacts of negative pricing by either reducing generation output or by increasing electricity consumption. Generally, it is undesirable to reduce generation from a renewable resource, since the City only gets credit for having that renewable generator based on its measured output. Turning off the generator means no progress would be made toward the State’s mandates and quotas, but turning off a generator would be effective at avoiding the negative prices. Traditionally, increasing consumption in response to CAISO negative pricing isn’t realistic, as endusers of energy tend to adapt to energy pricing over longer periods of time rather than these 5-minute increments the CAISO presents. The average consumer will not be watching a 5-minute price ticker and making decisions about their home electricity uses.

However, by adding a BESS to the City’s electric portfolio, the City could increase its load on a discretionary basis (i.e., charge the battery).

An energy storage resource, such as the Trolley Pass Project, introduces the ability for the electric portfolio to simultaneously dispatch the energy storage resource to consume electricity from the grid, while dispatching City renewable generators to inject electricity to the gird. First, this would enable the City to have its renewable generators continue to produce even with negative wholesale pricing, thereby making progress toward complying with the State’s renewable energy mandate. Second, dispatching the battery system to consume power from the grid creates an offsetting transaction in the CAISO markets, which is intended to protect against the adverse financial impacts of negative pricing.

A summary of Trolley Pass Project is provided in the table below. City expressed interest in a 5 MW share of this project.
77 Item Description
Developer (Seller) Aypa Power Holdings, d.b.a.
“Trolley Pass Project, LLC”
Technology Battery Energy Storage System, only
Total Power Plant Size (MW) 400 MW
Location San Bernardino County
Balancing Authority CAISO
NCPA Contract Size (MW) 320 MW
Contract Term 20 years, commencing 6/1/2029
City Participation Share (MW / %) 5 MW / 1.5625%
City Approx. Annual Energy N/A
CAISO Deliverability Status Full Deliverability
The Value of “Capacity” – A Reliable Power Source
As noted in the table above, this project has a capacity attribute of “Full Deliverability.” This is a valuable and increasingly rare designation. It is awarded only to those resources that have invested in sufficient powerline improvements to allow full throughput at the time of the grid peak demand. This will enable the City to rely on this plant to serve load when general supply conditions are tight (e.g., drought years). Or, the City could opt to sell this capacity attribute.

There would be two contracts required to facilitate this transaction, but the City would be party to only one of these. First, NCPA would contract with a Seller directly under an energy storage services agreement (“ESSA”). Second, NCPA facilitates the transfer of all rights and obligations of the ESSA to the 8 participating NCPA Members through a contract NCPA calls, a “Third Phase Agreement.” For clarity, staff is requesting City Council consideration and possible action on the NCPA Third Phase Agreement, as that is the only contract the City would be party to. However, since the Third Phase Agreement passes through all rights and obligations of the ESSA, the ESSA is attached to the Third Phase Agreement as an Exhibit.

FISCAL IMPACT
There are 3 cost factors to discuss: cost associated with the ESSA, CAISO market costs and proceeds, and administrative costs. The net cost of adding this resource to the City’s portfolio is expected to be near zero.

First, the cost of the ESSA will be passed to each of the Participating Members of the attached Third Phase Agreement, based on their participation percentages. The City’s proportionate share of gross cost would be about $762,600 per year.

Second, the project will be subject to the CAISO’s markets. Since a BESS can both consume and discharge electricity from/to the grid, the Trolley Pass Project will have market costs and market proceeds throughout the year. NCPA prepared a conservative financial analysis that suggests that the probable market revenues will be of similar magnitude resulting in about $750,000 in net market proceeds. The value is created primarily by the BESS’ ability to charge (consume) when prices are typically lower and to 78 discharge (“produce”) when prices are typically higher. Moreover, this project has “full deliverability” status, which carries a market premium.

On a side note, the ESSA was crafted so that the billable quantity adjusts based on the system’s performance over time. That is, if the batteries degrade over time, the annual cost will also decline.

Third, City’s allocation of NCPA’s administrative cost for this facility is estimated at $15,000 per year. Any interaction with the CAISO creates a specialized administrative burden to schedule generation daily, to deal with the weekly billing, and to deal with several revisions to those billings that occur over years called, “prior-period adjustments.” Each generation facility must have a single entity designated to perform these tasks, and NCPA will do so on behalf of the Participating Members. NCPA charges for these services on a cost-basis. The contract may also call for cash deposits from the City, which are immaterial.

Lastly, it should be noted that contracts for facilities under development face some risk of repricing. Both the ESSA and Third Phase agreements contain provisions discussing this (see sections 2.5 and 8.5, respectively). Staff recommends City Council delegate authority to staff to negotiate and execute contract amendments in a manner consistent with the delegation of authority made under Resolution CC-14-65. Applying those principles here, the attached resolution would authorize the City Manager, or her designee, to also authorize changes to the attached contract provided that the incremental cost is consistent with the City’s approved policies.

ATTACHMENTS
Resolution CC-2025-XX
NCPA Third Phase Agreement – Trolley Pass Project

DISTRIBUTION
City Council
79 RESOLUTION NO CC-2024-XX

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SHASTA LAKE

APPROVING THE THIRD PHASE AGREEMENT WITH NORTHERN CALIFORNIA POWER AGENCY (“NCPA”) FOR THE TROLLEY PASS PROJECT
WHEREAS, the City is subject to California State law that require electric utilities to have at least 60% of its Customers’ electricity needs in the form of renewable energy, as defined in law, by 2030, provided that the cost of such resources is consistent with the City’s renewable energy cost limitation policy, among other alternative compliance mechanisms, as provided under law; and
WHEREAS, the wholesale electricity markets administered by the CA Independent System Operator (CAISO) are expanding to cover areas throughout the Western United States and are likely to impact City Electric Operations within five years; and WHEREAS, the expanding renewable energy supply and CAISO markets introduced competing external forces where the City is expected to keep renewable resources online (to meet the renewable energy mandate) while market signals can strongly incentivizing generation to be reduced (through negative market pricing), or face potentially significant consequences; and
WHEREAS, the City is a Member of NCPA, a Joint Powers Agency that has extensive experience building and buying power supply for its Members, which allows the City to leverage joint purchasing to lower administrative and direct costs through joint action; and WHEREAS, NCPA issued a market solicitation for renewable energy supply on behalf of its Members, and Aypa Power Holdings, doing business as “Trolley Pass Project, LLC,” submitted a response offering to sell energy storage services associated with a 320 megawatt (MW) portion of a battery energy storage facility, the “Trolley Pass Project,” which has been selected for contract by NCPA and eight of its Members; and WHEREAS, the City finds that the proposal for the Trolley Pass Project, using data known and available at this time, appears to help promote the City’s obligations under current law; provides capacity to the electric portfolio; appears financially viable when considering all contract costs, potential market costs, potential market proceeds, and administrative costs; and provides an ability to potentially reduce the financial risks inherent to the CAISO markets; and
WHEREAS, the City desires to participate in the NCPA “Third Phase Agreement for Energy Storage Services Agreement with Trolley Pass Project, LLC” (“Third Phase Agreement”), with a 5 MW portion, with any benefits used to serve the Electric Fund wholesale power costs.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Shasta Lake approves the Third Phase Agreement and authorizes the City Manager to execute and administer the Third Phase Agreement on the City’s behalf. 80 BE IT FURTHER RESOLVED that the City Manager, or designee, is authorized to act on the City’s behalf to implement the Third Phase Agreement, including approving subsequent changes to pricing consistent with City policies.

PASSED, APPROVED, AND ADOPTED this 16th day of September 2025, by the following vote:

AYES:

NOES:

ABSENT:
_______________________________
PAMELYN ANNE MORGAN, Mayor
ATTEST:
____________________________

CHARITY TATLOW, CMC
City Clerk
81 THIRD PHASE AGREEMENT
FOR

ENERGY STORAGE SERVICE AGREEMENT
WITH

TROLLEY PASS PROJECT LLC
82 i

THIRD PHASE AGREEMENT FOR BATTERY ENERGY STORAGE AGREEMENT

TABLE OF CONTENTS
Section 1. Definitions ....................................................................................................3 Section 2. Purpose .......................................................................................................10 Section 3. Sale and Purchase of Product ..................................................................10 Section 4. Billing and Payments ................................................................................11 Section 5. Security Deposit Administration.............................................................14 Section 6. Cooperation and Further Assurances.....................................................19 Section 7. Participant Covenants and Defaults .......................................................19 Section 8. Administration of Agreement .................................................................23 Section 9. Transfer of Rights by Participants...........................................................25 Section 10. Term and Termination..............................................................................26 Section 11. Withdrawal of Participants ......................................................................26 Section 12. Settlement of Disputes and Arbitration .................................................27 Section 13. Miscellaneous.............................................................................................27 EXHIBIT A. Project Participation Percentages...........................................................40 EXHIBIT B. Eenergy Storage Services Agreement ....................................................40 83 1

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT This THIRD PHASE AGREEMENT (“this Agreement”) is dated as of ______________, 20__ by and among the Northern California Power Agency, a joint powers agency of the State of California (“NCPA”), and the signatories to this Agreement other than NCPA (“Participants”). NCPA and the Participants are referred to herein individually as a “Party” and collectively as the “Parties”.

RECITALS
A. NCPA has heretofore been duly established as a public agency pursuant to the Joint Exercise of Powers Act of the Government Code of the State of California and, among other things, is authorized to acquire, construct, finance, and operate buildings, works, facilities, and improvements for the generation and transmission of electric capacity and energy for resale.

B. Each of the Participants is a signatory to the Joint Powers Agreement which created NCPA and therefore is a Member.

C. Each of the Participants to this Agreement have executed the Amended and Restated Facilities Agreement, dated October 1, 2014, which establishes the framework under which Project Agreements are created for the development, design, financing, construction, and operation of specific NCPA Projects.
84 2

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT D. The Participants desire NCPA to enter into an Energy Storage Service Agreement (“ESSA”) with Trolley Pass Project LLC (“Seller”), to purchase the Product for the benefit of the Participants’ customers.

E. Each Participant is authorized by its Constitutive Documents to obtain the Product for its present or future requirements, through contracts with NCPA or otherwise.

F. To enable NCPA to enter into the ESSA on behalf of the Participants, pursuant to the terms and conditions of the Amended and Restated Facilities Agreement, NCPA and the Participants wish to enter into this Agreement to provide all means necessary for NCPA to fulfill obligations incurred on behalf of NCPA and the Participants pursuant to the ESSA, and to enable and obligate the Participants to take delivery of and pay for the Product and to pay NCPA for all costs it incurs for undertaking the foregoing activities.

G. Upon full execution of this Agreement, NCPA will enter into the ESSA on behalf of the Participants, and such ESSA shall be deemed a NCPA Project by the Commission.

H. Each of the Parties intends to observe the provisions of this Agreement in good faith and shall cooperate with all other Parties in order to achieve the full benefits of joint action.

I. The Parties desire to equitably allocate costs of NCPA’s provision of services under this Agreement among the Participants.
85 3

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT J. The Participants further desire, insofar as possible, to insulate other Members who are not Participants, from risks inherent in the services and transactions undertaken on behalf of the Participants pursuant to this Agreement.

NOW, THEREFORE, the Parties agree as follows:

Section 1. Definitions.

1.1 Definitions. Whenever used in this Agreement (including the Recitals hereto), the following terms shall have the following respective meanings, provided, capitalized terms used in this Agreement (including the Recitals hereto) that are not defined in Section 1 of this Agreement shall have the meaning indicated in Section 1 of the Power Management and Administrative Services Agreement, dated October 1, 2014:

1.1.1 “Actual Contract Price Increase” has the meaning set forth in Section 1.1 of the ESSA.

1.1.2 “Administrative Services Costs” means that portion of the NCPA administrative, general and occupancy costs and expenses, including those costs and expenses associated with the operations, direction and supervision of the general affairs and activities of NCPA, general management, treasury operations, accounting, budgeting, payroll, human resources, information technology, facilities management, salaries and wages (including retirement benefits) of employees, facility operation and maintenance costs, taxes and payments in lieu of taxes (if any), insurance premiums, fees for legal, engineering, financial and other services, power management services, 86 4

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT general settlement and billing services and general risk management costs, that are charged directly or apportioned to the provision of services under this Agreement.

Administrative Services Costs as separately defined herein and used in the context of this Agreement is different and distinct from the term Administrative Services Costs as defined in Section 1 of the Power Management and Administrative Services Agreement.

1.1.3 “Agreement” means this Third Phase Agreement, including all Exhibits attached hereto.

1.1.4 "All Resources Bill” has the meaning set forth in the Power Management and Administrative Services Agreement.

1.1.5 “CAISO” means the California Independent System Operator Corporation, or its functional successor.

1.1.6 “CAISO Tariff” means the duly authorized tariff, rules, protocols and other requirements of the CAISO, as amended from time to time.

1.1.7 “Capacity Damages” has the meaning set forth in Section 1.1 of the ESSA.

1.1.8 “Change in Tax Law” has the meaning set forth in Section 1.1 of the ESSA.

1.1.9 “Commercial Operation” has the meaning set forth in Section 1.1 of the ESSA.
87 5

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT

1.1.10 “Commercial Operation Date” has the meaning set forth in Section

1.1 of the ESSA.

1.1.11 "Commission” has the meaning set forth in the Power Management and Administrative Services Agreement.

1.1.12 “Constitutive Documents” means, with respect to NCPA, the Joint Powers Agreement and any resolutions or bylaws adopted thereunder with respect to the governance of NCPA, and with respect to each Participant, the California Government Code and other statutory provisions applicable to such Participant, any applicable agreements, charters, contracts, or other documents concerning the formation, operation or decision making of such Participant, including, if applicable, its city charter, and any codes, ordinances, bylaws, and resolutions adopted by such Participant’s governing body.

1.1.13 “Contract Price” has the meaning set forth in Section 1.1 of the ESSA.

1.1.14 “Defaulting Participant” has the meaning set forth in Section 7.2.

1.1.15 “Electric System” has the meaning set forth in the Power Management and Administrative Services Agreement.

1.1.16 “Event of Default” has the meaning set forth in Section 7.2.

1.1.17 “Facility” has the meaning set forth in Section 1.1 of the ESSA. 88 6

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT

1.1.18 “Final Independent Report” has the meaning set forth in Section

1.1 of the ESSA.

1.1.19 “General Operating Reserve” means the NCPA General Operating Reserve created through resolution of the Commission, as the same may be amended from time to time.

1.1.20 “Initial Independent Report” has the meaning set forth in Section

1.1 of the ESSA.

1.1.21 “Installed Battery Capacity” has the meaning set forth in Section

1.1 of the ESSA.

1.1.22 “MW” means megawatt.

1.1.23 “MWh” means megawatt hour.

1.1.24 “NCPA” has the meaning set forth in the Recitals hereto.

1.1.25 “Participant” has the meaning set forth in the recitals of this Agreement.

1.1.26 “Party” or “Parties” has the meaning set forth in the preamble hereto; provided that “Third Parties” are entities that are not Party to this Agreement.

1.1.27 “Power Management and Administrative Services Agreement” means the NCPA Power Management and Administrative Services Agreement, dated as of October 1, 2014, between NCPA and the Members who are signatories to that agreement by which NCPA provides Power Management and Administrative Services. 89 7

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1.1.28 “Product” has the meaning set forth in Section 1.1 of the ESSA.

1.1.29 “Project” or “ESSA” means the Energy Storage Service Agreement, dated as of ____________, 20__ between NCPA and Seller, under which NCPA, on behalf of the Participants, purchases Product from the Facility located in San Bernardino County, California, consisting of a separately metered section of a larger battery energy storage facility commonly known as the Trolley Battery Energy Storage Project. Upon final execution of the ESSA, the Project shall be deemed a NCPA Project in accordance with the Amended and Restated Facilities Agreement. The ESSA has been attached to this Agreement as Exhibit B.

1.1.30 “Project Costs” means all costs charged to and paid by NCPA pursuant to the ESSA.

1.1.31 “Project Participation Percentage” has the meaning set forth in the Power Management and Administrative Services Agreement, and are set forth in Exhibit A of this Agreement.

1.1.32 “Proposed Contract Price Increase” has the meaning set forth in Section 1.1 of the ESSA.

1.1.33 “Proposed Contract Price Increase Cap” has the meaning set forth in Section 1.1 of the ESSA.

1.1.34 “Revenue” means , with respect to each Participant, all income, rents, rates, fees, charges, and other moneys derived by the Participant from the 90 8

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT ownership or operation of its Electric System, including, without limiting the generality of the foregoing: (a) all income, rents, rates, fees, charges or other moneys derived from the sale, furnishing and supplying of electric capacity and energy and other services, facilities, and commodities sold, furnished, or supplied through the facilities of its Electric System; (b) the earnings on and income derived from the investment of such income, rents, rates, fees, charges or other moneys to the extent that the use of such earnings and income is limited by or pursuant to law to its Electric System; (c) the proceeds derived by the Participant directly or indirectly from the sale, lease or other disposition of all or a part of the Electric System; and (d) the proceeds derived by Participant directly or indirectly from the consignment and sale of freely allocated greenhouse gas compliance instruments into periodic auctions administered by the State of California under the California Cap-and-Trade Program, provided that such proceeds are a permitted use of auction proceeds, but the term Revenues shall not include (i) customers' deposits or any other deposits subject to refund until such deposits have become the property of the Participant or (ii) contributions from customers for the payment of costs of construction of facilities to serve them.

1.1.35 “Scheduling Protocols” means the applicable provisions of the Amended and Restated Scheduling Coordination Program Agreement, and any other contractual or other arrangements between NCPA and the Participants concerning the scheduling, delivery and metering of the ESSA.
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1.1.36 “Security Deposit” means the account established by NCPA and funded by the Participants in accordance with Section 5, the funds of which are available for use by NCPA in accordance with the terms and conditions hereof.

1.1.37 “Seller” means Trolley Pass Project LLC, as set forth in Recital D of this Agreement, or as otherwise set forth in the ESSA.

1.1.38 “Storage Contract Capacity” has the meaning set forth in Section

1.1 of the ESSA.

1.1.39 “Supply Chain Event” has the meaning set forth in Section 1.1 of in the ESSA.

1.1.40 “Term” has the meaning set forth in Section 10.

1.1.41 “Third Party” means an entity (including a Member) that is not Party to this Agreement.

1.2 Rules of Interpretation. As used in this Agreement (including the Recitals hereto), unless in any such case the context requires otherwise: The terms “herein,” “hereto,” “herewith” and “hereof” are references to this Agreement taken as a whole and not to any particular provision; the term “include,” “includes” or “including” shall mean “including, for example and without limitation;” and references to a “Section,” “subsection,” “clause,” “Appendix”, “Schedule”, or “Exhibit” shall mean a Section, subsection, clause, Appendix, Schedule or Exhibit of this Agreement, as the case may be.

All references to a given agreement, instrument, tariff or other document, or law, 92 10

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT regulation or ordinance shall be a reference to that agreement, instrument, tariff or other document, or law, regulation or ordinance as such now exists and as may be amended from time to time, or its successor. A reference to a “person” includes any individual, partnership, firm, company, corporation, joint venture, trust, association, organization or other entity, in each case whether or not having a separate legal personality and includes its successors and permitted assigns. A reference to a “day” shall mean a Calendar Day unless otherwise specified. The singular shall include the plural and the masculine shall include the feminine, and vice versa.

Section 2. Purpose. The purpose of this Agreement is to: (i) set forth the terms and conditions under which NCPA shall enter into the ESSA on behalf of the Participants, (ii) authorize NCPA, acting on behalf of the Participants, to engage in all activities related to that basic purpose, and (iii) specify the rights and obligations of NCPA and the Participants with respect to the ESSA.

Section 3. Sale and Purchase of Product. By executing this Agreement, each Participant acknowledges and agrees to be bound by the terms and conditions of the Agreement, and that the Agreement is written as a “take-or-pay” agreement. Any Product delivered to NCPA under the ESSA shall be delivered to each Participant in proportion to such Participant’s Project Participation Percentage as set forth in Exhibit A, and each Participant shall accept and pay for its respective percentage of such Product. To the extent a Participant is unable to accept such deliveries in full, NCPA shall dispose of such 93 11

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT surplus in its sole discretion, in such a manner to attempt to maximize Participant value and that Participant shall reimburse to NCPA any costs incurred by NCPA in doing so.

Notwithstanding the above, NCPA may allocate Product procured through the ESSA among the Participants in such percentages as NCPA may, in its reasonable discretion, determine are necessary, desirable, or appropriate, in order to accommodate Participant transfer rights pursuant to Section 9.

3.1 Scheduling. Product delivered from Seller shall be scheduled for and to the Participants in accordance with Scheduling Protocols, and the terms and conditions of the ESSA.

Section 4. Billing and Payments

4.1 Participant Payment Obligations. Each Participant agrees to pay to NCPA each month its respective portion of the Project Costs, Administrative Services Costs, scheduling coordination costs, and all other costs for services provided in accordance with this Agreement and the Amended and Restated Facilities Agreement. In addition to the aforementioned monthly payment obligations, each Participant is obligated to fund: (i) any and all required Security Deposits calculated in accordance with Section 5, and (ii) any working capital requirements for the Project maintained by NCPA as determined, collected and set forth in the Annual Budget.

4.2 Invoices. NCPA will issue an invoice to each Participant for its share of Project Costs, Administrative Services Costs, scheduling coordination costs, and all other 94 12

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT costs for services provided in accordance with this Agreement and the Amended and Restated Facilities Agreement. Such invoice may be either the All Resources Bill or separate special invoice, as determined by NCPA. At NCPA’s discretion, invoices may be issued to Participants using electronic media or physical distribution.

4.3 Payment of Invoices. All invoices delivered by NCPA (including the All Resources Bill) are due and payable thirty (30) Calendar Days after the date thereof; provided, however, that any amount due on a day other than a Business Day may be paid on the following Business Day.

4.4 Late Payments. Any amount due and not paid by a Participant in accordance with Section 4.3 shall be considered late and bear interest computed on a daily basis until paid at the lesser of (i) the per annum prime rate (or reference rate) of the Bank of America NT&SA then in effect, plus two percent (2%) or (ii) the maximum rate permitted by law.

4.5 Billing Disputes. A Participant may dispute the accuracy of any invoice issued by NCPA under this Agreement by submitting a written dispute to NCPA, within thirty (30) Calendar Days after the date of such invoice; nonetheless the Participant shall pay the full amount billed when due. If a Participant does not timely question or dispute the accuracy of any invoice in writing, then the invoice shall be deemed to be correct.

Upon review of a submitted dispute, if an invoice is determined by NCPA to be incorrect, then NCPA shall issue a corrected invoice and refund any amounts that may be due to the Participant. If NCPA and the Participant fail to agree on the accuracy of an invoice within 95 13

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT thirty (30) Calendar Days after the Participant has disputed it, then the General Manager shall promptly submit the dispute to the Commission for resolution. If the Commission and the Participant fail to agree on the accuracy of a disputed invoice within sixty (60) Calendar Days after its submission to the Commission, then the dispute may then be resolved under the mediation and arbitration procedures set forth in Section 12 of this Agreement; provided, however, that prior to resorting to either mediation or arbitration proceedings, the full amount of the disputed invoice must be paid by the Participant.

4.6 Billing/Settlement Data and Examination of Books and Records.

4.6.1 Settlement Data. NCPA shall make billing and settlement data available to the Participants in the All Resources Bill, or other invoice, or upon request.

NCPA may also, at its sole discretion, make billing and settlement support information available to Participants using electronic media (e.g. electronic data portal).

Procedures and formats for the provision of such electronic data submission may be established by the Commission from time to time. Without limiting the generality of the foregoing, NCPA may, in its reasonable discretion, require the Participants to execute a non-disclosure agreement prior to providing access to the NCPA electronic data portal.

4.6.2 Examination of Books and Records. Any Participant to this Agreement shall have the right to examine the books and records created and 96 14

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT maintained by NCPA pursuant to this Agreement at any reasonable, mutually agreed upon time.

Section 5. Security Deposit Administration

5.1 Security Deposit Requirements. Each Participant agrees that any funds deposited at NCPA to satisfy Participant’s Security Deposit requirements pursuant to this Agreement shall be irrevocably committed and held by NCPA in the General Operating Reserve, and that such funds may be used by NCPA in accordance with Section 5.1.3.

Each Participant’s Security Deposit will be accounted separately from and in addition to any other security accounts or deposits maintained pursuant to any other agreement between NCPA and the Participant, or any other such security account or deposits required of Members. In connection with fulfilling the Security Deposit requirements of this Agreement, Participant may elect to use its uncommitted funds held in the General Operating Reserve to satisfy in whole or in part its Security Deposit required under Section 5. If Participant chooses to satisfy in whole or in part its security requirements using its uncommitted funds held in the General Operating Reserve, then Participant is required to execute and deliver to NCPA an Irrevocable Letter of Direction, directing NCPA to utilize Participant’s uncommitted General Operating Reserve funds for such purposes, and the designated funds will thereafter be irrevocably committed and held by NCPA to satisfy the requirements of this Agreement.
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5.1.1 Initial Amounts. No later than ninety (90) day prior to the Commercial Operation Date, each Participant shall ensure that sufficient Security Deposit funds have been deposited with and are held by NCPA in an amount not greater than the highest three (3) months of estimated Project Costs, as estimated by NCPA. Such Security Deposit requirement may be satisfied by Participant in whole or part either in cash, through irrevocable commitment of its uncommitted funds held in the General Operating Reserve in accordance with Section 5.1, or through a clean, irrevocable letter of credit satisfactory to NCPA’s General Manager.

5.1.2 Subsequent Deposits. Periodically, and at least quarterly, NCPA shall review and revise its estimate of Project Costs for which Participant shall be obligated to pay under this Agreement. Following such review, NCPA shall determine whether each Participant has a sufficient Security Deposit balance at NCPA. To the extent that any Participant’s Security Deposit balance is greater than one hundred and ten percent (110%) of the amount required herein, NCPA shall credit such amount as soon as practicable to the Participant’s next following All Resources Bill, or by separate special invoice. To the extent that any Participant’s Security Deposit balance is less than ninety percent (90%) of the amount required herein, NCPA shall add such amount as soon as practicable to such Participant’s next All Resources Bill, or as necessary, to a special invoice to be paid by Participant upon receipt. Credits or additions shall not be made to Participants who satisfy these Security Deposit requirements in whole through 98 16

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT the use of a letter of credit; provided, that the amount of the letter of credit shall be adjusted, as required from time to time, in a like manner to assure an amount not to exceed the highest three (3) months of estimated Project Costs is available to NCPA, as determined by NCPA.

5.1.3 Use of Security Deposit Funds. NCPA may use any and all Security Deposit funds held by NCPA (or utilize a letter of credit provided in lieu thereof) to pay any costs it incurs hereunder, including making payments to Seller, without regard to any individual Participant’s Security Deposit balance or proportionate share of Project Costs, and irrespective of whether NCPA has issued an All Resources Bill or special invoice for such costs to the Participants or whether a Participant has made timely payments of All Resources Bills or special invoices.

Should Participant have satisfied its Security Deposit requirements in whole or part through a letter of credit, NCPA may draw on such letter of credit to satisfy Participant’s obligations hereunder at NCPA’s sole discretion. Notwithstanding the foregoing, if any Participant fails to pay any costs incurred by NCPA pursuant to this Agreement, NCPA shall first use that non-paying Participant’s Security Deposit and shall not use any other Participants’ Security Deposit until such non-paying Participant’s Security Deposit has been exhausted.

5.1.4 Accounting. If Security Deposit funds or a letter of credit are used by NCPA to pay any costs it incurs hereunder as described in Section 5.1.3, then NCPA 99 17

THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT will maintain a detailed accounting of each Participant’s shares of funds withdrawn, and upon the collection of all or a part of such withdrawn funds, NCPA will credit back to each non-defaulting Participant the funds collected in proportion to such nondefaulting Participant’s share of funds initially withdrawn.

5.1.5 Emergency Additions. In the event that funds are withdrawn pursuant to Section 5.1.3, or if the Security Deposit held by NCPA is otherwise insufficient to allow for NCPA to pay any invoice, demand, request for further assurances by Seller, or claims, NCPA shall notify all Participants of the deficiency. In conjunction with such notice, NCPA shall send a special or emergency assessment invoice to the Participant or Participants that caused or are otherwise responsible for the deficiency. Each Participant of such an invoice shall pay to NCPA such assessment when and if assessed by NCPA within two (2) Business Days of the invoice date of the assessment, or shall consent to and direct NCPA to draw on any existing letter of credit Participant has established for such purposes. In the event that the Participant or Participants that caused or are otherwise responsible for the deficiency cannot, does not or will not pay to NCPA the special or emergency assessment within two (2) Business Days after the invoice date, NCPA shall immediately submit a special or emergency invoice to all remaining Participants, and such remaining Participants shall pay to NCPA such assessment within two (2) Business Days after the invoice date of 100
18 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT the assessment, or shall consent to and direct NCPA to draw on any existing letter of credit that Participant has established for such purposes.

5.1.6 Security Deposit Interest. NCPA shall maintain a detailed accounting of each Participant’s Security Deposits, and withdrawals of such funds, held by NCPA. Security Deposits held by NCPA shall be invested by NCPA in accordance with the General Operating Reserve policies and investment policies adopted by the NCPA Commission. Interest earned on the Security Deposit funds shall be proportionately credited to the Participants in accordance with their weighted average balances held therein. Any Security Deposit losses caused by early termination of investments shall be allocated among the Participants in accordance with the General Operating Reserve provisions and guidelines approved by the Commission, as the same may be amended from time to time; provided, however, to the extent that either the General Operating Reserve provisions and guidelines do not apply or the Security Deposit is not adequate to cover the losses, then such losses shall be allocated among the Participants in accordance with their proportionate Security Deposit balances.

5.1.7 Return of Funds. Upon termination or a permitted withdrawal of a Participant in accordance with this Agreement, the affected Participant may apply to NCPA for the return of their share of Security Deposit funds ninety (90) days after the effective date of such termination or withdrawal. However, NCPA shall, in its sole but 101
19 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT reasonable discretion, as determined by the NCPA General Manager, estimate the then outstanding liabilities of the Participant, including any estimated contingent liabilities and shall retain all such funds, if any, until all such liabilities have been fully paid or otherwise satisfied in full. After all such liabilities have been satisfied in full, as determined by NCPA’s General Manager, any remaining balance of the Participant’s share of the Security Deposit will be refunded to the Participant within sixty (60) days thereafter.

Section 6. Cooperation and Further Assurances. Each of the Parties agree to provide such information, execute and deliver any instruments and documents and to take such other actions as may be necessary or reasonably requested by any other Party which are consistent with the provisions of this Agreement and which do not involve the assumption of obligations other than those provided for in this Agreement, in order to give full effect to this Agreement and to carry out the intent of this Agreement. The Parties agree to cooperate and act in good faith in connection with obtaining any credit support required in order to satisfy the requirements of this Agreement.

Section 7. Participant Covenants and Defaults

7.1 Each Participant covenants and agrees: (i) to make payments to NCPA, from its Electric System Revenues, of its obligations under this Agreement as an operating expense of its Electric System; (ii) to fix the rates and charges for services provided by its Electric System, so that it will at all times have sufficient Revenues to meet the obligations 102
20 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT of this Agreement, including the payment obligations; (iii) to make all such payments due NCPA under this Agreement whether or not there is an interruption in, interference with, or reduction or suspension of services provided under this Agreement, such payments not being subject to any reduction, whether by offset or otherwise, and regardless of whether any reasonable dispute exists; and (iv) to operate its Electric System, and the business in connection therewith, in accordance with Good Utility Practices.

7.2 Events of Default. An Event of Default under this Agreement shall exist upon the occurrence of any one or more of the following by a Participant (the “Defaulting Participant”):
(i) the failure of any Participant to make any payment in full to NCPA when due;
(ii) the failure of a Participant to perform any covenant or obligation of this Agreement where such failure is not cured within thirty (30) Calendar Days following receipt of a notice from NCPA demanding cure; provided, that this subsection shall not apply to any failure to make payments specified by subsection 7.2 (i)); (iii) if any representation or warranty of a Participant material to the services provided hereunder shall prove to have been incorrect in any material respect when made and the Participant does not cure the facts underlying such incorrect representation or warranty so that the representation or warranty becomes true and correct within thirty (30) Calendar Days after the date of receipt of notice from NCPA demanding cure; or 103
21 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT (iv) if a Participant is in default or in breach of any of its covenants or obligations under any other agreement with NCPA and such default or breach is not cured within the time periods specified in such agreement.

7.3 Uncontrollable Forces. A Party shall not be considered to be in default in respect of any obligation hereunder if prevented from fulfilling such obligation by reason of Uncontrollable Forces; provided, that in order to be relieved of an Event of Default due to Uncontrollable Forces, a Party affected by an Uncontrollable Force shall:
(i) first provide oral notice to the General Manager using telephone communication within two (2) Business Days after the onset of the Uncontrollable Force, and provide subsequent written notice to the General Manager and all other Parties within ten (10) Business Days after the onset of the Uncontrollable Force, describing its nature and extent, the obligations which the Party is unable to fulfill, the anticipated duration of the Uncontrollable Force, and the actions which the Party will undertake so as to remove such disability and be able to fulfill its obligations hereunder; and (ii) use due diligence to place itself in a position to fulfill its obligations hereunder and if unable to fulfill any obligation by reason of an Uncontrollable Force such Party shall exercise due diligence to remove such disability with reasonable dispatch; provided, that nothing in this subsection shall require a Party to settle or compromise a labor dispute.
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7.4 Cure of an Event of Default. An Event of Default shall be deemed cured only if such default shall be remedied or cured within the time periods specified in Section 7.2 above, as may be applicable, provided, however, upon request of the Defaulting Participant the Commission may waive the default at its sole discretion, where such waiver shall not be unreasonably withheld.

7.5 Remedies in the Event of Uncured Default. Upon the occurrence of an Event of Default which is not cured within the time limits specified in Section 7.2, without limiting other rights or remedies available under this Agreement, at law or in equity, and without constituting or resulting in a waiver, release or estoppel of any right, action or cause of action NCPA may have against the Defaulting Participant, NCPA may take any or all of the following actions:
(i) suspend the provision of services under this Agreement to such Defaulting Participant; or
(ii) demand that the Defaulting Participant provide further assurances to guarantee the correction of the default, including the collection of a surcharge or increase in electric rates, or such other actions as may be necessary to produce necessary Revenues to correct the default.

7.6 Effect of Suspension.

7.6.1 Generally. The suspension of this Agreement will not terminate, waive, or otherwise discharge any ongoing or undischarged liabilities, credits or 105
23 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT obligations arising from this Agreement until such liabilities, credits or obligations are satisfied in full.

7.6.2 Suspension. If performance of all or any portion of this Agreement is suspended by NCPA with respect to a Participant in accordance with subsection

7.5(i), then such Participant shall pay any and all costs incurred by NCPA as a result of such suspension including reasonable attorney’s fees, the fees and expenses of other experts, including auditors and accountants, or other reasonable and necessary costs associated with such suspension and any portion of the Project Costs, scheduling and dispatch costs, and Administrative Services Costs that were not recovered from such Participant as a result of such suspension.

Section 8. Administration of Agreement

8.1 Commission. The Commission is responsible for the administration of this Agreement. Each Participant shall be represented by its Commissioner or their designated alternate Commissioner (“Alternate”) pursuant to the Joint Powers Agreement. Each Commissioner shall have authority to act for the Participant represented with respect to matters pertaining to this Agreement.

8.2 Forum. Whenever any action anticipated by this Agreement is required to be jointly taken by the Participants, such action shall be taken at regular or special meetings of the NCPA Commission.
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8.3 Quorum. For purposes of acting upon matters that relate to administration of this Agreement, a quorum of the Participants shall consist of those Commissioners, or their designated Alternate, representing a numerical majority of the Participants.

8.4 Voting. Each Participant shall have the right to cast one vote with respect to matters pertaining to this Agreement. A unanimous vote of all Participants shall be required for action regarding: (i) any transfer of rights to a Third Party as described in Section 9 of this Agreement; and (ii) for matters related to any of the following actions as provided for in the ESSA: (a) exercising any early termination provisions as set forth in the ESSA, and (b) exercising any assignment rights as set forth in the ESSA. For all other matters pertaining to this Agreement, a majority vote of the Participants shall be required for action.

8.5 Storage Rate Adjustment Event. Section 2.5 of the ESSA permits the Seller to request a Contract Price adjustment from NCPA to address cost increases that Seller incurs as a result of a Change in Tax Law or Supply Chain Event. If the Proposed Contract Price Increase or Actual Contract Price Increase is equal to or less than the Proposed Contract Price Increase Cap, then as further set forth in Section 2.5 of the ESSA, such Proposed Contract Price Increase or Actual Contract Price Increase shall be deemed accepted by the Participants and NCPA, and the parties to the ESSA shall amend the Contract Price in the ESSA.
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25 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT If the Proposed Contract Price Increase and/or Actual Contract Price Increase is greater than the Proposed Contract Price Increase Cap by an amount that is less than or equal to fifteen percent (15.00%) of the original Contract Price, in aggregate, then the NCPA General Manager is hereby delegated authority by the Participants to approve the price increase based on their determination that (1) the Initial Independent Report or Final Independent Report supports the Proposed Contract Price Increase and/or Actual Contract Price Increase, and (2) the ESSA with the Proposed Contract Price Increase and/or Actual Contract Price Increase is still favorable when compared to current market conditions for similar products. The NCPA General Manager shall notify the Commission of the acceptable Proposed Contract Price Increase and/or Actual Contract Price Increase and associated modifications to the ESSA with the foregoing findings, if any, at the next available Commission meeting. If the Proposed Contract Price Increase and/or Actual Contract Price Increase is greater than fifteen percent (15.00%) of the original Contract Price, in aggregate, then the proposed modifications to the ESSA will be brought to the Commission for discussion and further action.

Section 9. Transfer of Rights by Participants

9.1 A Participant has the right to make transfers, sales, assignments and exchanges (collectively “transfers(s)”) of any portion of its Project Participation Percentage and rights thereto, subject to the approval provisions in Section 8.4 of this Agreement, provided that the transferee satisfies all applicable criterion in the ESSA. If a Participant 108
26 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT desires to transfer a portion or its entire share of the Project for a specific time interval, or permanently, then NCPA will, if requested by such Participant, use its best efforts to transfer that portion of the Participant’s share of the Project.

9.2 Unless otherwise set forth in this Agreement, before a Participant may transfer an excess Project share pursuant to Section 9.1 to any person or entity other than a Participant, it shall give all other Participants the right to purchase the share on the same terms and conditions. Before a Participant may transfer an excess Project share pursuant to Section 9.1 to any person or entity other than a Member, it shall give all Members the right to purchase the share on the same terms and conditions. Such right shall be exercised within thirty (30) days of receipt of notice of said right.

No transfer shall relieve a Participant of any of its obligations under this Agreement except to the extent that NCPA receives payment of these obligations from a transferee.

Section 10. Term and Termination. This Agreement shall become effective when it has been duly executed by all Participants, and delivered to and executed by NCPA (the “Effective Date”). NCPA shall notify all Participants in writing of the Effective Date. The Term of this Agreement shall be coterminous with the ESSA, and shall commence on the Effective Date, and shall continue through the term of the ESSA.

Section 11. Withdrawal of Participants. No Participant may withdraw from this Agreement except as otherwise provided for herein.
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27 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT Section 12. Settlement of Disputes and Arbitration. The Parties agree to make best efforts to settle all disputes among themselves connected with this Agreement as a matter of normal business under this Agreement. The procedures set forth in Section 10 of the Power Management and Administrative Services Agreement shall apply to all disputes that cannot be settled by the Participants themselves; provided, that the provisions of Section 4.5 shall first apply to all disputes involving invoices prepared by NCPA.

Section 13. Miscellaneous

13.1 Confidentiality. The Parties will keep confidential all confidential or trade secret information made available to them in connection with this Agreement, to the extent possible, consistent with applicable laws, including the California Public Records Act.

Confidential or trade secret information shall be marked or expressly identified as such.

If a Party (“Receiving Party”) receives a request from a Third Party for access to, or inspection, disclosure or copying of, any other Party’s (the “Supplying Party”) confidential data or information, which the Receiving Party has possession of (“Disclosure Request”), then the Receiving Party shall provide notice and a copy of the Disclosure Request to the Supplying Party within three (3) Business Days after receipt of the Disclosure Request.

Within three (3) Business Days after receipt of such notice, the Supplying Party shall provide notice to the Receiving Party either:
(i) that the Supplying Party believes there are reasonable legal grounds for denying or objecting to the Disclosure Request, and the Supplying Party requests the 110
28 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT Receiving Party to deny or object to the Disclosure Request with respect to identified confidential information. In such case, the Receiving Party shall deny the Disclosure Request and the Supplying Party shall defend the denial of the Disclosure Request at its sole cost, and it shall indemnify the Receiving Party for all costs associated with denying or objecting to the Disclosure Request. Such indemnification by the Supplying Party of the Receiving Party shall include all of the Receiving Party’s costs reasonably incurred with respect to denial of or objection to the Disclosure Request, including but not limited to costs, penalties, and the Receiving Party’s attorney’s fees; or (ii) that the Receiving Party may grant the Disclosure Request without any liability by the Receiving Party to the Supplying Party.

13.2 Indemnification and Hold Harmless. Subject to the provisions of Section

13.4, each Participant agrees to indemnify, defend and hold harmless NCPA and its Members, including their respective governing boards, officials, officers, agents, and employees, from and against any and all claims, suits, losses, costs, damages, expenses and liability of any kind or nature, including reasonable attorneys’ fees and the costs of litigation, including experts, to the extent caused by any acts, omissions, breach of contract, negligence (active or passive), gross negligence, recklessness, or willful misconduct of that Participant, its governing officials, officers, employees, subcontractors or agents, to the maximum extent permitted by law.
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13.3 Several Liabilities. No Participant shall, in the first instance, be liable under this Agreement for the obligations of any other Participant or for the obligations of NCPA incurred on behalf of other Participants. Each Participant shall be solely responsible and liable for performance of its obligations under this Agreement, except as otherwise provided for herein. The obligation of each Participant under this Agreement is, in the first instance, a several obligation and not a joint obligation with those of the other Participants.

Notwithstanding the foregoing, the Participants acknowledge that any debts or obligations incurred by NCPA under this Agreement on behalf of any of them shall be borne solely by such Participants in proportion to their respective Project Participation Percentages, and not by non-Participant Members of NCPA, pursuant to Article IV, Section 3(b) of the Joint Powers Agreement.

In the event that a Participant should fail to pay its share of the debts or obligations incurred by NCPA as required by this Agreement, the remaining Participants shall, in proportion to their Project Participation Percentages, pay such unpaid amounts and shall be reimbursed by the Participant failing to make such payments.

13.4 No Consequential Damages. FOR ANY BREACH OF ANY PROVISION OF

THIS AGREEMENT FOR WHICH AN EXPRESS REMEDY OR MEASURE OF DAMAGES

IS PROVIDED IN THIS AGREEMENT, THE LIABILITY OF THE DEFAULTING PARTY

SHALL BE LIMITED AS SET FORTH IN SUCH PROVISION, AND ALL OTHER 112
30 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT DAMAGES OR REMEDIES ARE HEREBY WAIVED. IF NO REMEDY OR MEASURE OF

DAMAGE IS EXPRESSLY PROVIDED, THE LIABILITY OF THE DEFAULTING PARTY

SHALL BE LIMITED TO ACTUAL DAMAGES ONLY AND ALL OTHER DAMAGES AND REMEDIES ARE HEREBY WAIVED. IN NO EVENT SHALL NCPA OR ANY

PARTICIPANT OR THEIR RESPECTIVE SUCCESSORS, ASSIGNS, REPRESENTATIVES,

DIRECTORS, OFFICERS, AGENTS, OR EMPLOYEES BE LIABLE FOR ANY LOST

PROFITS, CONSEQUENTIAL, SPECIAL, EXEMPLARY, INDIRECT, PUNITIVE, OR

INCIDENTAL LOSSES OR DAMAGES, INCLUDING LOSS OF USE, LOSS OF

GOODWILL, LOST REVENUES, LOSS OF PROFIT OR LOSS OF CONTRACTS EVEN IF

SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, AND

NCPA AND EACH PARTICIPANT EACH HEREBY WAIVES SUCH CLAIMS AND

RELEASES EACH OTHER AND EACH OF SUCH PERSONS FROM ANY SUCH LIABILITY.

The Parties acknowledge that California Civil Code section 1542 provides that: “A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.” The Parties waive the provisions of section 1542, or other similar provisions of law, and intend that the waiver and release provided by this Section of this Agreement shall be fully enforceable despite its reference to future or unknown claims.
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13.5 Waiver. No waiver of the performance by a Party of any obligation under this Agreement with respect to any default or any other matter arising in connection with this Agreement shall be effective unless given by the Commission or the governing body of a Participant, as applicable. Any such waiver by the Commission in any particular instance shall not be deemed a waiver with respect to any subsequent performance, default or matter.

13.6 Amendments. Except where this Agreement specifically provides otherwise, this Agreement may be amended only by written instrument executed by the Parties with the same formality as this Agreement.

13.7 Assignment of Agreement.

13.7.1 Binding Upon Successors. This Agreement shall inure to the benefit of and shall be binding upon the respective successors and assignees of the Parties to this Agreement.

13.7.2 No Assignment. Neither this Agreement, nor any interest herein, shall be transferred or assigned by a Party hereto except with the consent in writing of the other Parties hereto, which consent shall not be unreasonably withheld.

13.8 Severability. In the event that any of the terms, covenants or conditions of this Agreement or the application of any such term, covenant or condition, shall be held invalid as to any person or circumstance by any court having jurisdiction, all other terms, covenants or conditions of this Agreement and their application shall not be affected 114
32 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT thereby, but shall remain in force and effect unless the court holds that such provisions are not severable from all other provisions of this Agreement.

13.9 Governing Law. This Agreement shall be interpreted, governed by, and construed under the laws of the State of California.

13.10 Headings. All indices, titles, subject headings, section titles and similar items are provided for the purpose of convenience and are not intended to be inclusive, definitive, or affect the meaning of the contents of this Agreement or the scope thereof.

13.11 Notices. Any notice, demand or request required or authorized by this Agreement to be given to any Party shall be in writing, and shall either be personally delivered to a Participant’s Commissioner or Alternate, and to the General Manager, or shall be transmitted to the Participant and the General Manager at the addresses shown on the signature pages hereof. The designation of such addresses may be changed at any time by written notice given to the General Manager who shall thereupon give written notice of such change to each Participant. All such notices shall be deemed delivered when personally delivered, two (2) Business Days after deposit in the United States mail first class postage prepaid, or on the first Business Day following delivery through electronic communication.

13.12 Warranty of Authority. Each Party represents and warrants that it has been duly authorized by all requisite approval and action to execute and deliver this Agreement and that this Agreement is a binding, legal, and valid agreement enforceable in accordance 115
33 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT with its terms. Upon execution of this Agreement, each Participant shall deliver to NCPA a resolution of the governing body of such Participant evidencing approval of and authority to enter into this Agreement.

13.13 Counterparts. This Agreement may be executed in any number of counterparts, and each executed counterpart shall have the same force and effect as an original instrument and as if all the signatories to all of the counterparts had signed the same instrument. Any signature page of this Agreement may be detached from any counterpart of this Agreement without impairing the legal effect of any signatures thereon, and may be attached to another counterpart of this Agreement identical in form hereto but having attached to it one or more signature pages.

13.14 Venue. In the event that a Party brings any action under this Agreement, the Parties agree that trial of such action shall be vested exclusively in the state courts of California in the County of Placer or in the United States District Court for the Eastern District of California.

13.15 Attorneys’ Fees. If a Party to this Agreement brings any action, including an action for declaratory relief, to enforce or interpret the provisions of this Agreement, then each Party shall bear its own fees and costs, including attorneys’ fees, associated with the action.

13.16 Counsel Representation. Pursuant to the provisions of California Civil Code Section 1717 (a), each of the Parties were represented by counsel in the negotiation and 116
34 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT execution of this Agreement and no one Party is the author of this Agreement or any of its subparts. Those terms of this Agreement which dictate the responsibility for bearing any attorney’s fees incurred in arbitration, litigation or settlement in a manner inconsistent with the provisions of Section 13.2 were intentionally so drafted by the Parties, and any ambiguities in this Agreement shall not be interpreted for or against a Party by reason of that Party being the author of the provision.

13.17 No Third Party Beneficiaries. Nothing contained in this Agreement is intended by the Parties, nor shall any provision of this Agreement be deemed or construed by the Parties, by any third person or any Third Parties, to be for the benefit of any Third Party, nor shall any Third Party have any right to enforce any provision of this Agreement or be entitled to damages for any breach by the Parties of any of the provisions of this Agreement.
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35 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT IN WITNESS WHEREOF, NCPA and each Participant have, by the signature of its duly authorized representative shown below, executed and delivered a counterpart of this Agreement.

NORTHERN CALIFORNIA

POWER AGENCY
651 Commerce Drive
Roseville, CA 95678
_____________________________
By: Randy S. Howard
Title: General Manager
Date:

Approved as to form:
_____________________________
By: Jane E. Luckhardt
Its: General Counsel
Date:

Attestation (if applicable):
_____________________________
By:__________________________
Its:

Date:

CITY OF SANTA CLARA
1500 Warburton Avenue
Santa Clara, CA 95050
_____________________________
By:__________________________
Title: __________________________
Date:

Approved as to form:
_____________________________
By:__________________________
Its: City Attorney
Date:

Attestation (if applicable):
_____________________________
By:__________________________
Its:

Date:
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36 THIRD PHASE AGREEMENT FOR ENERGY STORAGE SERVICE AGREEMENT

CITY OF ALAMEDA
2000 Grand Street
P.O. Box H
Alameda, CA 94501
_____________________________
By:__________________________
Title: ________________________
Date:

Approved as to form:
_____________________________
By:__________________________
Its: City Attorney
Date: