Agenda packet — Solana Beach City Council, June 24, 2026 (part 1 of 3)

CITY OF SOLANA BEACH
SOLANA BEACH CITY COUNCIL, SUCCESSOR AGENCY TO
THE REDEVELOPMENT AGENCY, PUBLIC FINANCING AUTHORITY,
& HOUSING AUTHORITY
AGENDA
Joint REGULAR Meeting
June 24, 2026 * 06:00 PM
City Hall / Council Chambers, 635 S. Highway 101, Solana Beach, California City Council meetings are video recorded and archived as a permanent record. The video recording captures the complete proceedings of the meeting and is available for viewing on the City's website.

Online posting of Reports & Supplemental Documents consist of items received up to the cut off time prior to meetings for processing new submittals (2 hrs prior to meeting start). Complete records containing meeting handouts, PowerPoints, etc. can be obtained from the records archive center.

The City Council shall not begin a new agenda item after 10:30 p.m. unless approved by a majority vote of all members present. SBMC 2.04.070
CITY COUNCIL
Mayor Lesa Heebner
Deputy Mayor Jill MacDonald - Council District 4
David A. Zito - Council District 1
Jewel Edson - Council District 3
Kristi Becker - Council District 2
Johanna Canlas, City Attorney Alyssa Muto, City Manager Angela Ivey, City Clerk ________________________________________________________________ PUBLIC MEETING ACCESS
Regular City Council meetings are held Wednesdays at 6:00 PM and broadcast live. Meeting schedules, including special sessions, are available on the City’s website. Recordings are archived on the Public Meetings webpage as a permanent record of proceedings.

WATCH THE MEETING
Live Web Streaming: Watch live on the Public Meetings page (click "Live Meeting"). TV Broadcast: Live on Cox Channel 19, Spectrum Channel 24, and AT&T U-verse Channel 99. Archived Videos: Recordings are permanently archived and available on the Public Meetings webpage.

AGENDA MATERIALS
A full City Council hard copy agenda packet including supporting documentation is available at City Hall, the Solana Beach Branch Library, La Colonia Community Ctr., and online www.cityofsolanabeach.ca.gov. Agendas are posted at least 72 hours prior to regular meetings and at least 24 hours prior to special meetings. Writings and documents regarding an agenda item received after the official agenda posting, and distributed to Council for consideration, will be made available for public viewing at the same time. In addition, items received at least 2 hours prior to the meeting time will be uploaded online with the agenda posting. Materials submitted for consideration should be forwarded to the City Clerk’s office at [email protected] . The designated location for viewing of hard copies is City Hall during normal business hours. 858-720-2400 City of Solana Beach City Council Meeting Actions June 24, 2026 Page 1 of 11 PUBLIC COMMENTS
Written comments on agenda items should be emailed to [email protected] with the meeting date in the subject line and the Agenda Item #. Comments received after agenda posting but at least two hours before the meeting will be shared with Council and posted online. All comments submitted before the meeting start will be part of the official record but will not be read aloud.

Verbal Comment Participation - To speak, submit a speaker slip to the City Clerk before the meeting or the item announcement. Speakers have the following time allocations:

Presentations/Proclamations: 3 minutes per speaker.

Oral Communications (non-agenda items): have 3 min. per speaker. No time donation of time is allowed.

Consent, Public Hearings, Staff Reports: each have 3 min. per speaker per item, time may be donated by another individual to the speaker for a total of 6 minutes, and groups are 1) Consent, Staff Reports (3+ people present form a group to speak 10 min. 2) Public Hearings (3+ people present form a group to speak 15 min.) COUNCIL DISCLOSURE
Under the Levine Act (Gov’t Code §84308), any party to a permit, license, contract (excluding competitively bid, labor, or personal employment contracts), or other entitlement before the Council must disclose any contributions over $250 made by them or their agents to any Councilmember in the past 12 mos. Public participants and their agents are also asked to disclose. The disclosure must include the contributor’s name, the recipient’s name, the amount, and the contribution date.

SPECIAL ASSISTANCE NEEDED
In compliance with the ADA, individuals with disabilities may request agendas in alternative formats or other accommodations by contacting the City Clerk’s office at (858) 720-2400 at least 72 hours before the meeting.

NOTICE: READING OF ORDINANCES AND RESOLUTIONS
Per Solana Beach Municipal Code §2.04.460, ordinances or resolutions are not read in full at introduction or adoption unless Council makes a request. Without a request to do so, the Council waives the full reading.

NOTICE: The City Council shall not begin a new agenda item after 10:30 p.m. unless by unanimous vote of members present. (SBMC 2.04.070)
Teleconference Location: 7457 Lake Rd E, Madison OH, 44057 - Zito ACTION AGENDA
The Action Agenda of the City Council Meeting is a document provided immediately following the Council Meeting in order for staff and the public to be aware of the business transacted and actions taken by Council. This is a preliminary draft and not a public record. The meeting’s legal record is the Minutes approved by the City Council.

CALL TO ORDER AND ROLL CALL
CLOSED SESSION REPORT
FLAG SALUTE
PROCLAMATIONS / CERTIFICATES / ACKNOWLEDGEMENTS
Ceremonial.
• Shawna Anderson, Executive Director, San Dieguito River Park JPA, Retirement A.

City of Solana Beach City Council Meeting Actions June 24, 2026 Page 2 of 11

PRESENTATIONS
None at the posted date of this agenda.

APPROVAL OF AGENDA
COUNCIL ACTION: Approved 5/0
COUNCIL ANNOUNCEMENTS-COMMENTARY
STAFF ANNOUNCEMENTS-COMMENTARY
ORAL COMMUNICATIONS
Comments relating to items on this evening’s agenda are taken at the time the items are heard. This portion of the agenda provides an opportunity for members of the public to address the City Council on items relating to City business and not appearing on today’s agenda by submitting a speaker slip (located on the back table) to the City Clerk.

Pursuant to the Brown Act, no action shall be taken by the City Council on public comment items. Council may refer items to the City Manager for placement on a future agenda. The maximum time allotted for each presentation is THREE MINUTES. No donations of time are permitted (SBMC 2.04.190). Please be aware of the timer light on the Council Dais.

CONSENT
Items listed on the Consent Calendar are to be acted in a single action of the City Council unless pulled for discussion. Any member of the public may address the City Council on an item of concern by submitting to the City Clerk a speaker slip (located on the back table) before the Consent Calendar is addressed. Those items removed from the Consent Calendar by Council or a member of the public who would like to make a comment will be heard immediately after approval of the Consent Calendar to hear the speakers.

1. Ratify the register of demands for May 23, 2026 - June 05, 2026.

COUNCIL ACTION: Approved 5/0
General Municipal Election - November 3, 2026
E.

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City of Solana Beach City Council Meeting Actions June 24, 2026 Page 3 of 11 Recommendation: That the City Council
Adopt Resolution 2026-036 Calling and Giving Notice of the Holding of a General Municipal Election to be held on Tuesday, November 3, 2026, for the Election of Certain Officers as required by the Provision of the Laws of the State of California Relating to General Law Cities and determining tie vote provisions.

1. Adopt Resolution 2026-037 requesting the Board of Supervisors of the County of San Diego to Consolidate a General Municipal Election to be held on Tuesday, November 3, 2026, with the Statewide General Election to be held on that date.

2. Adopt Resolution 2026-038 adopting regulations for Candidates for Elective Office pertaining to Candidate’s Statements.

3. COUNCIL ACTION: Approved 5/0
Appropriations Limit - Fiscal Year 2026-27
Recommendation: That the City Council
Adopt Resolution 2026-055 establishing the FY 2026/27 Appropriations Limit in accordance with Article XIIIB of the California Constitution and Government Code Section 7910 and choosing the County of San Diego’s change in population growth to calculate the Appropriations Limit.

1. COUNCIL ACTION: Approved 5/0
Investment Policy - Fiscal Year 2026-27
Recommendation: That the City Council
Adopt Resolution 2026-054 approving the City’s Investment Policy for FY 2026/27.

1. COUNCIL ACTION: Approved 5/0
Salary, Classification and Compensation Plans
Recommendation: That the City Council
Adopt Resolution 2026-071 approving the FY 2026/2027 Salary and Compensation Plans to include the following:

1. J.3
J.4
J.5
City of Solana Beach City Council Meeting Actions June 24, 2026 Page 4 of 11 Approval of a 3% adjustment to the FY 2026/2027 Management Salary Schedule and 6% increase in health care benefits.
•
Approval of a 3% adjustment to the FY 2026/2027 Confidential Salary Schedule , and 6% increase in health care benefits.
•
Approval of a 3% adjustment to the FY 2026/2027 SBEA Miscellaneous Salary Schedule and 6% increase in health care benefits. •
Approval of a 3% adjustment to the FY 2026/2027 Marine Safety Salary Schedule and 5% increase in health care benefits.
•
Approval of an increase in health care benefits for SBFA employees based on the median of CalPERS health rates for each Plan Year of the contract.
•
Approval of the FY 2026/2027 Part-Time/Temporary/Seasonal Salary Schedule, and to adjust positions in pay grade PTS 9101, 9121, and 9141 according to the California Minimum Wage effective January 1, 2027.
•
Approval 6% increase in health care benefits for the City Manager and Council Members commensurate with SBEA-MISC members.
•
Approval of the following new Staff position and creation of the following classification:
○ Administrative Services Director
•
Approval of the following job title change:
○ From “Community Development Director” to “Planning Director” •
Authorize the City Treasurer to amend the FY 2026/2027 Adopted Budget accordingly.

COUNCIL ACTION: Approved 5/0

2. Conflict of Interest Code Update
Recommendation: That the City Council
Adopt Resolution 2026-047 adopting an amended Solana Beach Conflict of Interest Code.

1. COUNCIL ACTION: Approved 5/0
Solana Beach Coastal Rail Trail (CRT) Maintenance District - Fiscal Year 2026-27
Recommendation: That the City Council
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City of Solana Beach City Council Meeting Actions June 24, 2026 Page 5 of 11 Adopt Resolution 2026-072 initiating the proceedings for the annual levy of assessments within the Coastal Rail Trail Maintenance District for Fiscal Year 2026/27.

1. Adopt Resolution 2026-073 approving the Preliminary Engineer's Report for proceedings of the annual levy of assessments within Coastal Rail Trail Maintenance District.

2. Adopt Resolution 2026-074 declaring intention to provide for the annual levy and collection of assessments in Coastal Rail Trail Maintenance District and setting a time and date for a public hearing for July 15, 2026.

3. Authorize the City Treasurer to amend Fiscal Year 2027 budget by increasing Interfund Transfers from Measure S by $3,460.

4. COUNCIL ACTION: Approved 5/0
Solana Beach Lighting District - Fiscal Year 2026-27
Recommendation: That the City Council
Adopt Resolution 2026-075 approving the Solana Beach Lighting Maintenance District Engineer’s Report for Fiscal Year 2026/27 for proceedings of the annual levy of assessments within a special maintenance district.

1. Adopt Resolution 2026-076 declaring intention to provide for an annual levy and collection of assessments in a special maintenance district and setting a time and date for a public hearing; and scheduling the public hearing for July 15, 2026.

2. COUNCIL ACTION: Approved 5/0
Fire Station Interior Improvements
Recommendation: That the City Council
Adopt Resolution 2026-069:

Aware and authorize the City Manager to execute a Construction Contract to Real Estate Consulting & Service, Inc., for the Fire Station Interior Improvements Project, in a not to exceed amount of $187,000 for FY 2026/2027.
a.

Authorizing the City Manager to approve Change Orders within the approved project budget.
b.

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City of Solana Beach City Council Meeting Actions June 24, 2026 Page 6 of 11 COUNCIL ACTION: Approved 5/0
Citywide Janitorial Services
Recommendation: That the City Council
Adopt Resolution 2026-077:

Authorizing the City Manager to execute an amendment to the Professional Services Agreement with California Office Cleaning, Inc., for Citywide Janitorial services, for Fiscal Year 2026/2027, and subsequent years, increasing the contract by $10,000 for a total not-toexceed amount of $137,880. a.

Approving a Budget Appropriations increase in the amount of $10,000 for FY 2026/27, and subsequent years.
b.

Authorizing the City Treasurer to amend the FY 2026/27 Adopted budget accordingly.
c.

1. COUNCIL ACTION: Approved 5/0
Work Plan - Fiscal Year 2026-27
Recommendation: That the City Council

1. Approve the 2026-27 Work Plan.

COUNCIL ACTION: Approved 5/0
Ambulance Services - American Medical Response (AMR) License Agreement
Recommendation: That the City Council
Adopt Resolution 2026-066:

Authorizing the City Manager to execute the License Agreement between the City and AMR generating $11,161.20 per month for the first six months of fiscal year 2027, and then increasing by CPI-U each January 1st, thereafter.
a.

Authorizing the City Treasurer to amend the fiscal year 2027 budget accordingly.
b.

1. COUNCIL ACTION: Approved 5/0
Fire Apparatus Maintenance and Emergency Repair Services J.10
J.11
J.12
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City of Solana Beach City Council Meeting Actions June 24, 2026 Page 7 of 11 Recommendation: That the City Council
Authorize an increase to the PSA with North County Emergency Vehicle Services to an amount not to exceed $94,000 for Fiscal Year 2025/26.

1. Authorize the City Manager to execute the fourth potential extension of the PSA with North County Emergency Vehicle Services for Fiscal Year 2026/27 to an amount not to exceed $94,000.

2. COUNCIL ACTION: Approved 5/0
SIGNED RESOLUTION 2026-079
City Attorney Services Contract Amendment
Recommendation: That the City Council
Adopt Resolution 2026-086 authorizing the Mayor to execute the Third Amendment to the Agreement between the City of Solana Beach and the Successor Agency to the Solana Beach Community Development Agency and Burke, Williams & Sorensen LLP.

1. COUNCIL ACTION: Approved 5/0
City Manager Employment Contract Amendment
Recommendation: That the City Council

1. Adopt Resolution 2026-085:

Authorizing the Mayor to execute the Second Amendment to the Employment Agreement between the City of Solana Beach and Alyssa Noelle Maxson Muto to reflect a base salary increase of 4% to $286,000, a $3,750.00 adjustment in deferred compensation to an annual total of $28,250.00, and an increase in the technology reimbursement to $100 a month, for an annual total of $1,200.00. The amended employment agreement will also provide for severance in amount equal to twelve (12) months of base salary.
a.

Amend the Salary and Compensation Plan to reflect the compensation changes contained in the Second Amendment to the Employment Agreement.
b.

COUNCIL ACTION: Approved 5/0
PUBLIC HEARINGS
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J.15
K.

City of Solana Beach City Council Meeting Actions June 24, 2026 Page 8 of 11 This portion of the agenda provides an opportunity for the public to comment on a specific item, as required by law and following proper notice. Individuals wishing to speak must submit a speaker slip to the City Clerk (available at the back table). After considering all evidence presented, including written materials and oral testimony, the City Council will render a decision supported by written findings based on substantial evidence in the record. An applicant or the applicant’s designee(s) for a private development or business project subject to a public hearing is allotted a total of fifteen (15) minutes to speak, in accordance with SBMC 2.04.210. A portion of this time may be reserved to respond to comments made in opposition. All other speakers should refer to the public comment section at the beginning of the agenda for applicable time limits. Speakers are asked to observe the timer light on the Council Dais.

Public Hearing: Vacancies, Recruitments, and Retention Efforts in Compliance with Assembly Bill 2561
Recommendation: That the City Council

1. Approve the Vacancy Status Report for Calendar Year 2025.

COUNCIL ACTION: Approved 5/0
Public Hearing: 146 S. Granados Ave., Applicant: Pelly, MOD26- 002/MEC26-001, APN: 298-093-90
The proposed project meets the minimum zoning requirements under the SBMC, may be found to be consistent with the General Plan and may be found, as conditioned, to meet the discretionary findings required as discussed in this report to approve a MEC. Therefore, Staff recommends that the City Council:

Conduct the Public Hearing: Continue the Public Hearing, Report Council Disclosures, Receive Public Testimony, and Close the Public Hearing.

1. Find the project exempt from the California Environmental Quality Act pursuant to Section 15303 of the State CEQA Guidelines; and

2. Consider whether circumstances warrant the conditions of approval in 2003, should be changed and therefore, remove conditions of approval B.i and/or B.ii included in Resolution 2003-070.

3. If the City Council makes the requisite findings to approve a MEC, adopt Resolution 2026-061 for a new fence on the southern property line between 146 and 150 S. Granados Avenue as outlined in the agreement.

4. COUNCIL ACTION: Approved 5/0
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City of Solana Beach City Council Meeting Actions June 24, 2026 Page 9 of 11 STAFF REPORTS
Submit speaker slips to the City Clerk. All speakers should refer to the public comment section at the beginning of the agenda for time allotments. Please be aware of the timer light on the Council Dais.

Coastal Rail Trail Extension – Design Options
Recommendation: That the City Council

1. Receive the presentation regarding the Coastal Rail Trail Extension project.

Provide feedback on the proposed project concepts and preferred configuration.

2. Discussion
Adopted Budget Updates - Fiscal Year 2027
Recommendation: That the City Council
Adopt Resolution 2026-064:

Approving revised appropriations to the Fiscal Year 2027 Adopted Budget.
a.

Authorizing the City Treasurer to amend the Fiscal Year 2027 Adopted Budget accordingly.
b.

1. COUNCIL ACTION: Approved 5/0
LEGISLATIVE POLICY AND CORRESPONDENCE
City Correspondence on proposed and existing state and federal laws.

WORK PLAN COMMENTS
Council comments on Work Plan status, needs, edits, etc. that were not discusssed on prior items. The Work Plan was last adopted June 18, 2025.

COMPENSATION & REIMBURSEMENT DISCLOSURE
GC: Article 2.3. Compensation: 53232.3. (a) Reimbursable expenses shall include, but not be limited to, meals, lodging, and travel. 53232.3 (d) Members of a legislative body shall provide brief reports on meetings attended at the expense of the local agency “City” at the next regular meeting of the legislative body.

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City of Solana Beach City Council Meeting Actions June 24, 2026 Page 10 of 11 COUNCIL COMMITTEE REPORTS
Regional Appointed Committees / Standing Committees / Citizen Commissions

ADJOURN
P.

City of Solana Beach City Council Meeting Actions June 24, 2026 Page 11 of 11 COUNCIL ACTION:
_______________________________________________________________________ AGENDA ITEM # J.1.

STAFF REPORT

CITY OF SOLANA BEACH
TO: Honorable Mayor and City Councilmembers
FROM: Alyssa Muto, City Manager
MEETING DATE: June 24, 2026
ORIGINATING DEPT: Finance – Rachel Jacobs, Finance Director SUBJECT: Register of Demands
BACKGROUND:

Section 3.04.020 of the Solana Beach Municipal Code requires that the City Council ratify a register of demands which represents all financial demands made upon the City for the applicable period.

DISCUSSION:

Staff certifies that the register of demands has been reviewed for accuracy, that funds are available to pay the above demands, and that the demands comply with the adopted budget.

CEQA COMPLIANCE STATEMENT: N/A
FISCAL IMPACT:

The register of demands for May 23, 2026, through June 05, 2026, reflects total expenditures of $1,193,157.71 from various City sources.

WORK PLAN: N/A
OPTIONS:

Item J.1
June 24, 2026
Register of Demands

Page 2 of 2 ends

 Ratify the register of demands.
 Do not ratify and provide direction.

CITY STAFF RECOMMENDATION:

Staff recommends that the City Council:

1. Ratify the above register of demands.
_________________________
Alyssa Muto, City Manager
Attachments:

1. Att 1 – Register of Demands 06-24-26 SR
Item J.1
Page: 1 of 9
City of Solana Beach
Register of Demands
5/23/2026 - 6/5/2026
Department
Vendor Description Date
Check/EFT
Number Amount
100 - GENERAL FUND
STERLING HEALTH SERVICES, INC. 05/29/2026 9002982 $266.67 SELF INSURED SERVICES COMPANY 05/29/2026 9002972 $3,453.60 STERLING HEALTH SERVICES, INC. 05/29/2026 9002982 $2,298.69 STERLING HEALTH SERVICES, INC. 05/29/2026 9002982 $1,923.50 AFLAC 05/29/2026 109792 $940.04
IAFF-MERP 05/29/2026 9002984 $4,625.00
SELF INSURED SERVICES COMPANY 06/04/2026 9002985 $1,349.58 MISSION SQUARE PLAN 302817 06/04/2026 9002993 $8,806.23 SOLANA BEACH FIREFIGHTERS ASSOC 06/04/2026 9003000 $1,080.00 FRANCHISE TAX BOARD 06/04/2026 109821 $158.86
SAN DIEGO COUNTY SHERIFFS OFFICE 06/04/2026 109825 ($875.36) US BANK 05/29/2026 109796 $6.59

US BANK
QC11 FSA CONTRIBUTIONS
JUN 26 - DENTAL/COBRA DENTAL
Q24 FSA/DCA CONTRIBUTIONS
Q24 FSA/DCA CONTRIBUTIONS
MAY 26
MAY 26 FF TRUST
JUN 26 LTD
Payroll Run 1 - Warrant Q25
Payroll Run 1 - Warrant Q25
Payroll Run 1 - Warrant Q25
MAR 26-SHERIFF SVC/CR TOW FEE/OVERTIME

REIMBURSED CHARGE - MS
REIMBURSED CHARGE - CM 05/29/2026 109796 $35.22
US BANK MUNIS CONF DINNER 05/29/2026 109795 $96.41
KYLE KOSZEWNIK MUNIS CONF DINNER 05/29/2026 9002978 ($96.41) SELF INSURED SERVICES COMPANY JUN 26 LIFE&ADD INS 06/04/2026 9002985 $1,414.88 SELF INSURED SERVICES COMPANY JUN 26 SUPP LIFE INS 06/04/2026 9002985 $316.50 TOTAL GENERAL FUND $25,800.00
1005100 - CITY COUNCIL
US BANK CLOSED SESSION - 3/25/26 05/29/2026 109795 $140.94 US BANK CLOSED SESSION - 4/8/26 05/29/2026 109795 $217.68 TOTAL CITY COUNCIL $358.62
1005150 - CITY CLERK
CORODATA RECORDS MANAGEMENT, INC APR 26-OFFSITE STORAGE 05/29/2026 109798 $968.56 US BANK SHELVES 05/29/2026 109795 $86.99
US BANK RETIREMENT FRAME - GREENSTEIN 05/29/2026 109795 $71.10 US BANK ELECTRONIC STORAGE - RECORDS 05/29/2026 109795 $119.88 US BANK GOOGLE DRIVE - COUNCIL MTGS/VAC RECORDINGS 05/29/2026 109795 $199.99 US BANK IIMC MEMBERSHIP 05/29/2026 109795 $135.00
US BANK CMCA MEMBERSHIP 05/29/2026 109795 $300.00
US BANK GIFTCARD - ADMIN DAY 05/29/2026 109795 $40.00
TOTAL CITY CLERK $1,921.52
1005200 - CITY MANAGER
EMANUELS JONES & ASSOCIATES, LLC MAY 26-LOBBYING SERVICES 06/04/2026 9002989 $2,785.12 US BANK RIBBON - FC RAMP RIBBON CUTTING 05/29/2026 109796 $10.86 US BANK DECOR - EE MORALE EVENT 4/9/2026 05/29/2026 109796 $13.80 US BANK DECOR - EE MORALE EVENT 4/9/2026 05/29/2026 109795 $61.96 US BANK REFRESHMENTS - EE MORALE EVENT 4/9/2026 05/29/2026 109795 $78.00 US BANK CERTIFICATE FRAME x2 05/29/2026 109795 $97.86
US BANK PROCLAMATION FRAMES 05/29/2026 109795 $95.62
US BANK MATTING/CERTIFICATE FRAME 05/29/2026 109795 $42.39 US BANK PROCLAMATION FRAME REFUND 05/29/2026 109796 ($29.07) Item J.1
Page: 2 of 9
US BANK CERTIFICATE FRAME 05/29/2026 109795 $56.52
US BANK REMOVABLE WALL PUTTY 05/29/2026 109796 $7.58
US BANK CLOSED SESSION - 3/25/26 05/29/2026 109796 $32.63 US BANK POST ITS 05/29/2026 109796 $18.80
US BANK PENS 05/29/2026 109796 $14.13
US BANK PROCLAMATION FRAME 05/29/2026 109796 $29.07
US BANK CLOSED SESSION - 4/8/26 05/29/2026 109796 $29.59 US BANK REFUND ACM MEMBERSHIP 05/29/2026 109795 ($1,200.00) US BANK INFO LUNCH TICKET 05/29/2026 109796 $28.75
US BANK WHITE BOARD 05/29/2026 109795 $45.34
US BANK CORK BOARD 05/29/2026 109796 $27.02
TOTAL CITY MANAGER $2,245.97
1005250 - LEGAL SERVICES
US BANK CLOSED SESSION - 3/25/26 05/29/2026 109795 $35.24 US BANK CLOSED SESSION - 4/8/26 05/29/2026 109795 $37.27 THE LEW EDWARDS GROUP MAR 26-PROF SERVICES 06/04/2026 109829 $6,750.00 THE LEW EDWARDS GROUP APR 26-PROF SERVICES 06/04/2026 109829 $6,750.00 TOTAL LEGAL SERVICES $13,572.51
1005300 - GENERAL FUND - FINANCE
THE ARTINA GROUP AP CHECKS 06/04/2026 109830 $582.62
THE ARTINA GROUP MICR LINE IMPRINTING-AP CHECKS 06/04/2026 109830 $70.69 US BANK TYLER CONF - DINNER 4/8 05/29/2026 109795 $67.98 US BANK TYLER CONF - LUNCH 4/10 05/29/2026 109796 $29.90 US BANK TYLER CONF - HOTEL 05/29/2026 109795 $592.96
US BANK TYLER CONF - DINNER 05/29/2026 109795 $90.97
US BANK TYLER CONF - COFFEE 05/29/2026 109796 $9.67
HDL HINDERLITER DE LLAMAS & ASSOC Q4-SALES TAX AUDIT/REPORTING SVC 05/29/2026 109800 $7,587.47 TYLER TECHNOLOGIES INC ECHECK RETURN ACTIVITY 05/29/2026 109808 $5.00 HDL COREN & CONE Q4-PROPERTY TAX AUDIT/REPORTING SVC 05/29/2026 9002977 $3,991.17 TOTAL GENERAL FUND - FINANCE $13,028.43
1005400 - HUMAN RESOURCES
US BANK INTERVIEW PANEL LUNCH - FPS 05/29/2026 109795 $102.16 US BANK BADGE HOLDERS 05/29/2026 109796 $31.38
US BANK PRINTER INK 05/29/2026 109795 $336.88
US BANK SEASONAL STAFF PERSONNEL FOLDERS 05/29/2026 109795 $41.31 US BANK PANEL SNACKS SR CIVIL ENGR 05/29/2026 109796 $5.89 US BANK TYLER CONF - UBER HOME TO AIRPORT 05/29/2026 109795 $86.96 KYLE KOSZEWNIK REIMB – TYLER MUNIS CONF 05/29/2026 9002978 $97.41 US BANK CITYWIDE MTG BFAST 05/29/2026 109795 $70.57
US BANK RETIREMENT/BDAY CARDS 05/29/2026 109796 $14.10
US BANK ADMIN DAY GIFT 05/29/2026 109795 $56.45
US BANK RETIREMENT JACKETS 05/29/2026 109795 $219.63
US BANK TYLER CONF - DINNER 4/8 05/29/2026 109795 $76.09 US BANK TYLER CONF - LUNCH 4/10 05/29/2026 109796 $28.60 US BANK EE LUNCH SUPPLIES 05/29/2026 109795 $304.52
US BANK TYLER CONF - HOTEL 05/29/2026 109795 $592.96
US BANK TRAINING MODULE SUB 05/29/2026 109795 $89.00
US BANK PANEL LUNCH - SNR CIVIL ENG 05/29/2026 109795 $144.85 US BANK EFAX SVC SUB 05/29/2026 109795 $49.99
US BANK CITYWIDE BFAST - JL/DH LAST CITYWIDE 05/29/2026 109795 $414.41 US BANK TYLER MUNIS CONF - UBER AIRPORT TO HOTEL 05/29/2026 109796 $26.03 Item J.1
Page: 3 of 9
US BANK TYLER MUNIS CONF - DINNER 05/29/2026 109795 $96.17 US BANK TYLER MUNIS CONF - UBER AIRPORT TO HOME 05/29/2026 109795 $80.95 US BANK TYLER MUNIS CONF - UBER HOTEL TO AIRPORT 05/29/2026 109796 $22.93 US BANK TYLER MUNIS CONF - HOTEL 05/29/2026 109795 $592.96 US BANK EE LUNCH - RENTAL EQUIPMENT 05/29/2026 109795 $223.33 TOTAL HUMAN RESOURCES $3,805.53
1005450 - INFORMATION SERVICES
US BANK CONSTANT CONTACT SUB 05/29/2026 109795 $129.00
US BANK YOUTUBE LIVE ACCOUNT SETUP 05/29/2026 109796 $8.40 US BANK ROUTER LICENSE 05/29/2026 109795 $77.82
US BANK DIGITAL CERT FOR VPN 05/29/2026 109795 $1,020.00 US BANK JAMF MDM 05/29/2026 109796 $26.00
US BANK POE ETHERNET SWITCHES 05/29/2026 109795 $152.23 US BANK ETHERNET SWITCHES 05/29/2026 109795 $100.01
VERIZON WIRELESS SD 362455526-00001 - 04/02/26-05/01/26 06/04/2026 109832 $290.19 TOTAL INFORMATION SERVICES $1,803.65
1005550 - PLANNING
US BANK BUSINESS CARDS 05/29/2026 109796 $28.26
US BANK LEGAL PADS/PENS 05/29/2026 109796 $26.84
TOTAL PLANNING $55.10
1005560 - BUILDING SERVICES
US BANK BUSINESS CARDS 05/29/2026 109796 $28.26
TOTAL BUILDING SERVICES $28.26
1005590 - CODE ENFORCEMENT
US BANK BUSINESS CARDS 05/29/2026 109796 $28.25
US BANK CAR WASH 05/29/2026 109796 $11.75
US BANK CAR WASH 05/29/2026 109796 $8.00
US BANK SHIRTS 05/29/2026 109795 $75.14
DATATICKET INC. APR 26-FRANCHISE TAX BOARD COLLECTIONS 06/04/2026 9002988 $220.00 DATATICKET INC. JAN 26-HEARING DECISION/SS # SEARCH/LETTER EXTR 06/04/2026 9002988 $76.34 DATATICKET INC. APR 26-CITATION PROCESSING 06/04/2026 9002988 $1,433.71 TOTAL CODE ENFORCEMENT $1,853.19
1006110 - LAW ENFORCEMENT
SAN DIEGO COUNTY SHERIFFS OFFICE MAR 26-SHERIFF SVC/CR TOW FEE/OVERTIME 06/04/2026 109825 $440,517.89 SAN DIEGO COUNTY SHERIFFS OFFICE MAR 26-SHERIFF SVC/CR TOW FEE/OVERTIME 06/04/2026 109825 $596.26 TOTAL LAW ENFORCEMENT $441,114.15
1006120 - FIRE DEPARTMENT
L. N. CURTIS & SONS INC CLUTCH/LOCK AXESS KITS/CARABINERS/RESCUE

SWIVELS
05/29/2026 109801 $2,185.81
ACE UNIFORMS LLC UNIFORM ESSENTAILS 05/29/2026 9002970 $1,853.14 THE ABY MANUFACTURING GROUP INC DOME BADGES 05/29/2026 9002975 $537.82 WEX BANK APR 26-AUTO FUE/CR TAX 05/29/2026 109810 $2,814.76 US BANK ELECTRICAL PLUGS 05/29/2026 109796 $17.59
US BANK ACCOUNTABILITY TAGS 05/29/2026 109795 $399.40
US BANK FIRE PREVENTION CODE BOOKS 05/29/2026 109795 $251.79 US BANK TRAINING BOOKS 05/29/2026 109795 $43.45
US BANK TRAINING BOOKS 05/29/2026 109795 $209.19
US BANK SHIPPING - PARTS FOR REPAIR 05/29/2026 109795 $65.95 US BANK MESSAGING MEMBERSHIP 05/29/2026 109796 $20.00
US BANK SCRAPERS 05/29/2026 109796 $19.56
US BANK TAPE/BLADES/RULERS/HOOKS 05/29/2026 109795 $50.94 Item J.1
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US BANK KEY RINGS/RULERS 05/29/2026 109796 $21.93
US BANK FLEET SERVICE - SOL PORTION 05/29/2026 109795 $257.64 US BANK FLEET SERVICE - DM PORTION 05/29/2026 109795 $141.76 US BANK LOCK BOXES - FIRE STATION/APPARATUSES 05/29/2026 109795 $327.92 US BANK RUBBING ALCOHOL 05/29/2026 109795 $37.19
US BANK BATTERIES 05/29/2026 109795 $116.64
US BANK SQUEEGEES 05/29/2026 109795 $104.61
US BANK VACUUM 05/29/2026 109795 $672.35
US BANK KITCHEN FRYER 05/29/2026 109795 $92.38
US BANK EXACTO KNIFE 05/29/2026 109796 $6.73
US BANK LUMBER FOR TRAINING 05/29/2026 109795 $206.56
US BANK LUMBER FOR TRAINING 05/29/2026 109795 $1,174.18 US BANK TRAINING MATERIAL 05/29/2026 109796 $7.45
US BANK LUMBER FOR TRAINING 05/29/2026 109795 $132.95
US BANK CLEANING SUPPLIES 05/29/2026 109795 $225.03
US BANK CLEANING SUPPLIES 05/29/2026 109795 $76.86
TOTAL FIRE DEPARTMENT $12,071.58
1006130 - ANIMAL CONTROL
HABITAT PROTECTION, INC DEAD ANIMAL REMOVAL 06/04/2026 9002991 $363.00 TOTAL ANIMAL CONTROL $363.00
1006170 - MARINE SAFETY
US BANK BATTERY - WEATHER TOWER 05/29/2026 109796 $9.78 US BANK PARTS FOR WEATHER TOWER 05/29/2026 109795 $109.09 US BANK CSLSA BOD MTG - HOTEL 05/29/2026 109795 $466.24 US BANK STINGRAY HOT WATER BAGS 05/29/2026 109795 $188.56 US BANK SUNGLASSES 05/29/2026 109795 $150.00
US BANK REFRESHMENTS - RECURRENT TRAINING 05/29/2026 109795 $205.25 US BANK SMALL SHARPS CONTAINERS 05/29/2026 109796 $16.30 US BANK PIZZA - IN SERVICE TRAINING 05/29/2026 109795 $207.86 US BANK SCHEDULING SOFTWARE 05/29/2026 109795 $327.60
US BANK SUPPLIES - JET SKI REPAIR 05/29/2026 109795 $251.57 AT&T CALNET 3 9391019469 - 04/20/26-05/19/26 06/04/2026 109814 $21.54 US BANK BLS RECERT - SEASONAL EMPLOYEES 05/29/2026 109795 $377.00 US BANK EMR RECERTS - SEASONAL LGS 05/29/2026 109795 $245.00 US BANK MEDICAL/FIRST AID RESTOCK 05/29/2026 109795 $412.32 US BANK SPLINTS - MEDICAL BOXES 05/29/2026 109795 $38.01 US BANK WATER 05/29/2026 109796 $26.97
US BANK RESCUE KNIVES - PWC/UNITS 05/29/2026 109795 $182.72 TOTAL MARINE SAFETY $3,235.81
1006510 - ENGINEERING
UNDERGROUND SVC ALERT OF SOCAL INC APR 26-DIG ALERT 05/29/2026 9002983 $96.00 US BANK GROUP TRAINING - AVOID/ACCOUNTABILITY 05/29/2026 109795 $295.00 US BANK CAR WASH 05/29/2026 109796 $18.00
WEST COAST CIVIL, INC JAN 26 - PROF SVC 06/04/2026 109834 $12,300.00 NORTH COUNTY TRANSIT DISTRICT ANNUAL LEASE - 02/03/26-02/02/27 06/04/2026 9002995 $352.59 CALIFORNIA BACKFLOW & CHLORINATION LLC RUBBER KITS/VALVE SEATS/REPAIRS & LABOR 06/04/2026 109817 $735.00 UT SAN DIEGO - NRTH COUNTY BID: 2026-03 / STMNT: 0000640456 06/04/2026 109831 $944.32 TOTAL ENGINEERING $14,740.91
1006520 - ENVIRONMENTAL SERVICES
MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $18.25 MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $18.26 Item J.1
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MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $18.25 BEST BEST & KRIEGER LLP APR 26-PROF SVC 05/29/2026 9002973 $69.30 IDRAINS LLC K-STORM INSPECTION 06/04/2026 109811 $1,700.00 CLEAN EARTH ENVIROMENTAL SOLUTIONS APR 26- HHW COLLECTION 06/04/2026 9002986 $1,354.38 TOTAL ENVIRONMENTAL SERVICES $3,178.44
1006530 - STREET MAINTENANCE
MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $29.86 MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $29.85 MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $29.86 BFS GROUP OF CALIFORNIA LLC LANTERN BATTERY/BATTERIES/GLOVES 05/29/2026 109799 $318.72 BFS GROUP OF CALIFORNIA LLC LUMBER/WHEEL CUT 05/29/2026 109799 $85.59 BFS GROUP OF CALIFORNIA LLC CRIMP WHEEL/RUSTOLEUM SPRAY 05/29/2026 109799 $15.31 SDG&E CO INC UTILITIES: 02/07/26-04/08/26 06/04/2026 109827 $571.49 SDG&E CO INC UTILITIES: 03/11/26-05/08/26 06/04/2026 109827 $731.72 SDG&E CO INC UTILITIES: 03/10/26-05/08/26 06/04/2026 109827 $898.83 NISSHO OF CALIFORNIA APR 26-PROF SVC 06/04/2026 9002994 $8,882.72 BFS GROUP OF CALIFORNIA LLC BLACK TOP PATCH/GLOVES/VEST 05/29/2026 109799 $262.60 US BANK LIGHTBULBS - CRT 05/29/2026 109795 $132.98
US BANK SPEED RADAR RECHARGE BATTERY - NARDO AVE 05/29/2026 109795 $73.35 BFS GROUP OF CALIFORNIA LLC GLOVES 06/04/2026 109819 $82.18 BFS GROUP OF CALIFORNIA LLC ROPE/STAKES 06/04/2026 109819 $71.92 SDG&E CO INC UTILITIES - 02/07/26-04/08/26 06/04/2026 109827 $671.70 TOTAL STREET MAINTENANCE $12,888.68
1006540 - TRAFFIC SAFETY
ALL CITY MANAGEMENT SERVICES, INC CROSSING GUARDS - 04/26/26-05/09/26 05/29/2026 9002971 $13,192.98 AT&T CALNET 3 9391012279 - 03/24/26-04/23/26 05/29/2026 109793 $68.05 AMERICAN TRAFFIC SOLUTIONS APR 26-RED LIGHT CAMERA ENFORCEMENT 06/04/2026 9003003 $8,408.04 SDG&E CO INC UTILITIES: 02/07/26-04/08/26 06/04/2026 109827 $1,041.24 SDG&E CO INC UTILITIES: 02/07/26-04/08/26 06/04/2026 109827 $356.98 SDG&E CO INC UTILITIES: 03/11/26-05/08/26 06/04/2026 109827 $686.20 SDG&E CO INC UTILITIES: 03/10/26-05/08/26 06/04/2026 109827 $1,223.55 AT&T CALNET 3 9391012279 - 04/24/26-05/23/26 06/04/2026 109812 $69.08 TOTAL TRAFFIC SAFETY $25,046.12
1006550 - STREET CLEANING
PRIDE INDUSTRIES APR 26-TRASH ABATEMENT SERVICES 05/29/2026 109805 $2,385.10 SCA OF CA, LLC MAY 26-STREET SWEEPING SERVICES 06/04/2026 9002999 $6,005.17 TOTAL STREET CLEANING $8,390.27
1006560 - PARK MAINTENANCE
MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $22.39 MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $22.38 MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $22.39 BFS GROUP OF CALIFORNIA LLC LUMBER 05/29/2026 109799 $249.26 BFS GROUP OF CALIFORNIA LLC THREADLOCKER/FLOOD LIGHT 05/29/2026 109799 $32.22 BFS GROUP OF CALIFORNIA LLC NUTS/WASH/BOLT/SCREWS 05/29/2026 109799 $14.86 SANTA FE IRRIGATION DISTRICT 005506-015 - 03/17/26-05/15/26 06/04/2026 109826 $396.40 SANTA FE IRRIGATION DISTRICT 005506-016 - 03/17/26-05/15/26 06/04/2026 109826 $333.40 SANTA FE IRRIGATION DISTRICT 005979-003 - 03/17/26-05/15/26 06/04/2026 109826 $1,204.58 NISSHO OF CALIFORNIA APR 26-PROF SVC 06/04/2026 9002994 $14,936.93 RANCHO SANTA FE SECURITY SYS INC JUN 26- ALARM MONITORING 06/04/2026 109824 $405.72 BFS GROUP OF CALIFORNIA LLC AIR DUSTER/MULCH 06/04/2026 109819 $86.65 BFS GROUP OF CALIFORNIA LLC THREADLOCKERS 06/04/2026 109819 $14.66 Item J.1
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BFS GROUP OF CALIFORNIA LLC BRASS NOZZLE/HOSE MENDERS 06/04/2026 109819 $64.82 VICTOR MAGANA GONZALEZ MILEAGE - 05/23/26-05/25/26 06/04/2026 109833 $136.30 W.W. GRAINGER, INC FLUSH VALVES/COLLAR WRENCH 06/04/2026 9002990 $755.10 NISSHO OF CALIFORNIA LC3 CELL LANDSCAPING SERVICES 06/04/2026 9002994 $1,603.20 NISSHO OF CALIFORNIA LANDSCAPING SERVICES 06/04/2026 9002994 $2,397.91 NISSHO OF CALIFORNIA LC8 LANDSCAPING SERVICES 06/04/2026 9002994 $1,260.00 NISSHO OF CALIFORNIA LC7 LANDSCAPING SERVICES 06/04/2026 9002994 $4,624.60 NISSHO OF CALIFORNIA LC6 LANDSCAPING SERVICES 06/04/2026 9002994 $4,315.26 US BANK HOSE - PRESSURE WASHER 05/29/2026 109795 $522.40 US BANK PAPER TOWEL DISPENSER 05/29/2026 109795 $67.22
VICTOR MAGANA GONZALEZ MILEAGE - 05/01/26 05/29/2026 109809 $34.08 US BANK HARDWARE - BIKE RACKS FCP 05/29/2026 109795 $108.40 US BANK BIKE RACK TOOL 05/29/2026 109795 $61.57
TOTAL PARK MAINTENANCE $33,692.70
1006570 - PUBLIC FACILITIES
HABITAT PROTECTION, INC APR 26 - PEST/RODENT CONTROL-TIDE PARK 05/29/2026 9002976 $71.00 HABITAT PROTECTION, INC APR 26- PEST/RODENT CONTROL-FCCC 05/29/2026 9002976 $43.00 HABITAT PROTECTION, INC APR 26 - PEST/RODENT CONTROL-MS 05/29/2026 9002976 $78.00 HABITAT PROTECTION, INC APR 26- PEST/RODENT CONTROL - FC 05/29/2026 9002976 $47.00 HABITAT PROTECTION, INC APR 26- PEST/RODENT CONTROL-SEASCAPE SUR 05/29/2026 9002976 $47.00 HABITAT PROTECTION, INC APR 26- PEST/RODENT CONTROL -DEL MAR SHORES 05/29/2026 9002976 $47.00 SDG&E CO INC UTILITIES: 02/07/26-04/08/26 06/04/2026 109827 $7,392.59 SDG&E CO INC UTILITIES: 02/07/26-04/08/26 06/04/2026 109827 $2,932.03 SDG&E CO INC UTILITIES: 03/11/26-05/08/26 06/04/2026 109827 $3,219.75 SDG&E CO INC UTILITIES: 03/10/26-05/08/26 06/04/2026 109827 $8,099.92 NISSHO OF CALIFORNIA APR 26-PROF SVC 06/04/2026 9002994 $1,877.86 W.W. GRAINGER, INC OEM REPLACEMENT MOTOR 06/04/2026 9002990 $165.02 W.W. GRAINGER, INC BULBS/LAMPS 06/04/2026 9002990 $1,070.50 CONSOLIDATED ELECTRICAL DIST INC LED LAMPS 06/04/2026 9002987 $163.13 CONSOLIDATED ELECTRICAL DIST INC LEDS 06/04/2026 9002987 $195.75 CONSOLIDATED ELECTRICAL DIST INC LEDS 06/04/2026 9002987 $195.75 W.W. GRAINGER, INC MANUAL FLUSH/COVERS/BRASS/FLUSH VALVE 06/04/2026 9002990 $1,000.49 BFS GROUP OF CALIFORNIA LLC SAFETY VEST/WALL TEXTURE/SPACKLE/GLOVES 06/04/2026 109819 $122.29 REAL ESTATE CONSULTING & SERVICES INC INSTALL NEW BREAKER 06/04/2026 9002998 $2,395.21 REAL ESTATE CONSULTING & SERVICES INC INSTALL NEW BREAKER 06/04/2026 9002998 $954.79 DCL ENTERPRISES PADLOCKS/TAGS 06/04/2026 9002992 $312.71 HABITAT PROTECTION, INC MAY 26-PEST/RODENT CONTROL-SEASCAPE SUR 06/04/2026 9002991 $47.00 HABITAT PROTECTION, INC MAY 26- PEST/RODENT CONTROL-DEL MAR SHORE 06/04/2026 9002991 $47.00 HABITAT PROTECTION, INC MAY 26- PEST/RODENT CONTROL-LCCC 06/04/2026 9002991 $78.00 BFS GROUP OF CALIFORNIA LLC ADAPTER/DRAIN BEND PIPE 06/04/2026 109819 $13.29 BFS GROUP OF CALIFORNIA LLC PIPE TAPE/ADAPTERS/COUPLING/CEMENT 06/04/2026 109819 $61.13 BFS GROUP OF CALIFORNIA LLC BIT TIP HOLDER/LUMBER 06/04/2026 109819 $30.17 HABITAT PROTECTION, INC MAY 26- PEST/RODENT CONTROL-FC 06/04/2026 9002991 $47.00 HABITAT PROTECTION, INC MAY 26- PEST/RODENT CONTROL-PW 06/04/2026 9002991 $78.00 HABITAT PROTECTION, INC MAY 26- PEST/RODENT CONTROL-MS 06/04/2026 9002991 $78.00 HABITAT PROTECTION, INC MAY 26- PEST/RODENT CONTROL-FCCC 06/04/2026 9002991 $78.00 HABITAT PROTECTION, INC MAY 26- PEST/RODENT CONTROL-TIDE PARK 06/04/2026 9002991 $71.00 HABITAT PROTECTION, INC MAY 26- PEST/RODENT CONTROL-CH 06/04/2026 9002991 $62.00 SEASIDE HEATING & AIR CONDITIONING MAR 26- HVAC SERVICES-MS 06/04/2026 109828 $120.00 SEASIDE HEATING & AIR CONDITIONING OCT 25- HVAC SERVICES-FS 06/04/2026 109828 $210.00 SEASIDE HEATING & AIR CONDITIONING MAR 26- HVAC SERVICES-FS 06/04/2026 109828 $210.00 Item J.1
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REAL ESTATE CONSULTING & SERVICES INC CARPET INSTALL 06/04/2026 9002998 $2,000.00 REAL ESTATE CONSULTING & SERVICES INC CARPET INSTALL 06/04/2026 9002998 $235.00 HABITAT PROTECTION, INC MAY 26-PEST/RODENT CONTROL-FS 06/04/2026 9002991 $46.00 LALLEY CONSTRUCTION FS- REPAIR SERVICES 06/04/2026 109823 $4,720.00 SEASIDE HEATING & AIR CONDITIONING MAY 26- HVAC SERVICES -LC 06/04/2026 109828 $180.00 SEASIDE HEATING & AIR CONDITIONING FEB 26-HVAC SERVICES - LC 06/04/2026 109828 $180.00 SEASIDE HEATING & AIR CONDITIONING MAR 26- HVAC SERVICES-CH 06/04/2026 109828 $360.00 SEASIDE HEATING & AIR CONDITIONING OCT 25- HVAC SERVICES-CH 06/04/2026 109828 $260.00 SEASIDE HEATING & AIR CONDITIONING FEB 26- HVAC SERVICES-MS 06/04/2026 109828 $120.00 LALLEY CONSTRUCTION FS- REPAIR SERVICES 06/04/2026 109823 $720.00 LALLEY CONSTRUCTION FS- REPAIR SERVICES 06/04/2026 109823 $4,560.00 LALLEY CONSTRUCTION LCCC- REPAIR SERVICES 06/04/2026 109823 $640.00 SANDIEGO COUNTY-AIR POLLUTION JUN 26-JUN 27-EMISSIONS RENEWAL 05/29/2026 109806 $753.00 BFS GROUP OF CALIFORNIA LLC PRESSURE SPRAYER/TRAPS/PAINT 05/29/2026 109799 $82.23 US BANK CLEANING SUPPLIES 05/29/2026 109795 $120.46
US BANK CLEANING SUPPLIES 05/29/2026 109796 $27.20
BFS GROUP OF CALIFORNIA LLC PAINT 05/29/2026 109799 $45.72 DCL ENTERPRISES FAST BOARD KEY 05/29/2026 9002979 $15.09 CINTAS CORPORATION NO. 2 FIRST AID SUPPLIES - CH 05/29/2026 109797 $439.65 CINTAS CORPORATION NO. 2 FIRST AID SUPPLIES -PW 05/29/2026 109797 $153.82 BFS GROUP OF CALIFORNIA LLC RECEPTACLES/STUD FINDER/WING GARD 05/29/2026 109799 $95.45 BFS GROUP OF CALIFORNIA LLC SCREWS/NAILS/NUTS 05/29/2026 109799 $21.50 BFS GROUP OF CALIFORNIA LLC PAINT/PAINT ROLLERS/POUR SPOUT 05/29/2026 109799 $59.68 BFS GROUP OF CALIFORNIA LLC CIRCULAR SAW 05/29/2026 109799 $249.04 BFS GROUP OF CALIFORNIA LLC NAILS/SCREWS/GLOVES 05/29/2026 109799 $178.24 BFS GROUP OF CALIFORNIA LLC SCREWS/PAINT ROLLERS 05/29/2026 109799 $60.69 HABITAT PROTECTION, INC APR 26 - PEST/RODENT CONTROL-FS 05/29/2026 9002976 $46.00 HABITAT PROTECTION, INC APR 26 - PEST/RODENT CONTROL-PW 05/29/2026 9002976 $78.00 BFS GROUP OF CALIFORNIA LLC TRAY LINER/PAINT BRUSHES/PAINTERS TAPE 05/29/2026 109799 $101.59 BFS GROUP OF CALIFORNIA LLC STUCCO MIX/MASONRY FLOAT 05/29/2026 109799 $62.09 BFS GROUP OF CALIFORNIA LLC ORANGE PEEL WALL TEXTURE/LUMBER/SCREWS 05/29/2026 109799 $47.55 HABITAT PROTECTION, INC APR 26- PEST/RODENT CONTROL-CH 05/29/2026 9002976 $62.00 HABITAT PROTECTION, INC APR 26- PEST/RODENT CONTROL-LCCC 05/29/2026 9002976 $78.00 CALIFORNIA OFFICE CLEANING, INC APR 26- JANITORIAL/CUSTODIAL SVC 05/29/2026 9002974 $8,401.00 PRIDE INDUSTRIES APR 26- TRASH ABATEMENT SERVICES 05/29/2026 109805 $2,385.10 SEASIDE HEATING & AIR CONDITIONING FY26 HVAC SERVICES AT CITY FACILITIES 05/29/2026 109807 $120.00 BFS GROUP OF CALIFORNIA LLC PAINT ROLLER 05/29/2026 109799 $9.78 TOTAL PUBLIC FACILITIES $59,375.26
1007100 - COMMUNITY SERVICES
US BANK RIBBONS - RIBBON CUTTING CEREMONIES 05/29/2026 109795 $46.70 TOTAL COMMUNITY SERVICES $46.70
1007110 - GF-RECREATION
US BANK HP TONER - LC 05/29/2026 109795 $70.57
US BANK HOT DOGS - EE LUNCH EVENT 05/29/2026 109795 $53.94 TOTAL GF-RECREATION $124.51
1205460 - SELF INSURANCE RETENTION
US BANK TYLER MUNIS CONF - DINNER 05/29/2026 109796 $34.56 US BANK TYLER MUNIS CONF - FLIGHT 05/29/2026 109795 $287.39 TOTAL SELF INSURANCE RETENTION $321.95
1355350 - ASSET REPLACEMENT
BUSINESS OFFICE OUTFITTERS COUNCIL CHAMBER AUDIENC CHAIRS (75) 06/04/2026 109816 $23,435.63 Item J.1
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TOTAL ASSET REPLACEMENT $23,435.63
1356120 - ASSET REPLACEMENT-FIRE
US BANK MATTRESS REPLACEMENT 05/29/2026 109795 $830.54
TOTAL ASSET REPLACEMENT-FIRE $830.54
1356510 - ASSET REPLACEMENT-ENGINEER
72 HOUR LLC PW CHEVY SILVERADO/EV CHARGER 05/29/2026 109803 $56,984.22 TOTAL ASSET REPLACEMENT-ENGINEER $56,984.22
1406510 - FACILITIES MAINT-CIP
UT SAN DIEGO - NRTH COUNTY BID: 2026-04 / STMNT: 0000640456 06/04/2026 109831 $926.47 TOTAL FACILITIES MAINT-CIP $926.47
1605360 - OPEB OBLIGATION
SELF INSURED SERVICES COMPANY JUN 26 - DENTAL/COBRA DENTAL 05/29/2026 9002972 $136.10 TOTAL OPEB OBLIGATION $136.10
2026510 - GAS TAX-ENGINEERING
YUNEX LLC JAN 26-TRAFFIC SIGNAL 06/04/2026 9003004 $5,500.75 TOTAL GAS TAX-ENGINEERING $5,500.75
2037510 - HIGHWAY 101 LANDSC #33
SDG&E CO INC UTILITIES: 02/07/26-04/08/26 06/04/2026 109827 $2,754.03 SDG&E CO INC UTILITIES: 03/10/26-05/08/26 06/04/2026 109827 $2,786.02 SANTA FE IRRIGATION DISTRICT 005979-004 - 03/17/26-05/15/26 06/04/2026 109826 $571.40 SANTA FE IRRIGATION DISTRICT 00732-000 - 03/17/26-05/15/26 06/04/2026 109826 $232.20 NISSHO OF CALIFORNIA APR 26-PROF SVC 06/04/2026 9002994 $14,199.63 TOTAL HIGHWAY 101 LANDSC #33 $20,543.28
2087580 - COASTAL RAIL TRAIL MAINT
NISSHO OF CALIFORNIA APR 26-PROF SVC 06/04/2026 9002994 $2,427.85 TOTAL COASTAL RAIL TRAIL MAINT $2,427.85
2117600 - STREET LIGHTING DISTRICT
SDG&E CO INC UTILITIES: 02/07/26-04/08/26 06/04/2026 109827 $10,269.21 SDG&E CO INC UTILITIES: 03/11/26-05/08/26 06/04/2026 109827 $8,148.60 TOTAL STREET LIGHTING DISTRICT $18,417.81
2135550 - DEVELOPER PASS-THRU- PLANNING
PERMITECH SOLUTIONS CORPORATION DUP26-001-PROF SVCS 05/29/2026 109804 $2,645.00 VAN DYKE LANDSCAPE ARCHITECTS MAR 26-PROF SVC 06/04/2026 9003002 $1,656.25 VAN DYKE LANDSCAPE ARCHITECTS MAR 26-PROF SVC 06/04/2026 9003002 $1,452.50 VAN DYKE LANDSCAPE ARCHITECTS MAR 26-PROF SVC 06/04/2026 9003002 $1,215.00 VAN DYKE LANDSCAPE ARCHITECTS MAR 26-PROF SVC 06/04/2026 9003002 $1,877.50 VAN DYKE LANDSCAPE ARCHITECTS MAR 26-PROF SVC 06/04/2026 9003002 $1,215.00 VAN DYKE LANDSCAPE ARCHITECTS MAR 26-PROF SVC 06/04/2026 9003002 $1,350.00 VAN DYKE LANDSCAPE ARCHITECTS MAR 26-PROF SVC 06/04/2026 9003002 $101.25 VAN DYKE LANDSCAPE ARCHITECTS MAR 26-PROF SVC 06/04/2026 9003002 $101.25 VAN DYKE LANDSCAPE ARCHITECTS MAR 26-PROF SVC 06/04/2026 9003002 $1,350.00 TOTAL DEVELOPER PASS-THRU- PLANNING $12,963.75
2505570 - COASTAL BUSINESS/VISITORS
US BANK EGG HUNT REFRESHMENTS 05/29/2026 109795 $211.88 US BANK EGG HUNT REFRESHMENTS 05/29/2026 109795 $251.30 SAM CASTELLANO 2026 CONCERT @ THE COVE-EQPMNT/TECH SVC 06/04/2026 109818 $1,872.00 BRIAN WITKIN 2026 CONCERT @ THE COVE - 06/25/26 06/04/2026 109815 $750.00 JOHN PERKINS 2026 CONCERT @ THE COVE - 06/18/26 06/04/2026 109822 $750.00 TOTAL COASTAL BUSINESS/VISITORS $3,835.18
Item J.1
Page: 9 of 9
2556180 - JUNIOR LIFEGUARDS
US BANK CALENDLY SUB 05/29/2026 109796 $12.00
US BANK JRLG SWIM TEST CARDS 05/29/2026 109795 $110.91
US BANK SWIM FINS - JRLG 05/29/2026 109795 $1,068.13
US BANK SUNSCREEN 05/29/2026 109795 $314.66
US BANK FINS - JG PROG 05/29/2026 109795 $457.76
US BANK JG TENTS 05/29/2026 109795 $835.11
ORIGINAL WATERMEN, INC JG UNIFORMS 06/04/2026 9002996 $9,178.15 TOTAL JUNIOR LIFEGUARDS $11,976.72
2706120 - PUBLIC SAFETY- FIRE
THE COUNSELING TEAM INTERNATIONAL MAY 26-FIRE MENTAL WELLNESS SVCS 06/04/2026 9003001 $468.00 TOTAL PUBLIC SAFETY- FIRE $468.00
459 - MISC. CAPITAL PROJECTS
PACIFIC POWER ENGINEERING TECHNOLOGY FIRE STATION GENERATOR 06/04/2026 9002997 ($1,005.80) TOTAL MISC. CAPITAL PROJECTS ($1,005.80)
4596510 - MISC.CAPITALPROJECTS-ENG
DOMUSSTUDIO ARCHITECTURE LLP APR 26- 9449.02 MS CENTR-PROF SVC 06/04/2026 109820 $3,191.93 PACIFIC POWER ENGINEERING TECHNOLOGY FIRE STATION GENERATOR 06/04/2026 9002997 $20,116.00 TOTAL MISC.CAPITALPROJECTS-ENG $23,307.93
5097700 - SANITATION
MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $12.43 MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $12.44 MISSION LINEN & UNIFORM INC FY26 UNIFORM SERVICES FOR PUBLIC WORKS 05/29/2026 109802 $12.43 AT&T CALNET 3 9391012277 - 03/24/26-04/23/26 05/29/2026 109794 $19.83 IDRAINS LLC APR 26-JETTER-SEWER HOT SPOT 06/04/2026 109811 $6,701.94 IDRAINS LLC C-SEWER CLEANING - 37,972 06/04/2026 109811 $23,922.36 IDRAINS LLC MAY 26-GENERAL SEWER CLEANING - 19,816 06/04/2026 109811 $12,484.08 IDRAINS LLC R-JETTER & CAMERA 06/04/2026 109811 $525.00 IDRAINS LLC PREVENTIVE JETTER SVC 06/04/2026 109811 $525.00 IDRAINS LLC PREVENTIVE JETTER SVC 06/04/2026 109811 $525.00 AT&T CALNET 3 9391012277 - 04/24/26-05/23/26 06/04/2026 109813 $19.88 TOTAL SANITATION $44,760.39
REPORT TOTAL: $904,571.68
Item J.1
COUNCIL ACTION:
_______________________________________________________________________ AGENDA ITEM # J.2.

STAFF REPORT

CITY OF SOLANA BEACH
TO: Honorable Mayor and City Councilmembers
FROM: Alyssa Muto, City Manager
MEETING DATE: June 24, 2026
ORIGINATING DEPT: City Clerk Department, Angela Ivey
SUBJECT: November 3, 2026 General Municipal Election for Elected District 2 Councilmember, and District 4 Councilmember
BACKGROUND:

Pursuant to the California Elections Code (EC) Section 1301 and Solana Beach Municipal Code (SBMC) Section 2.24.010, the City of Solana Beach conducts its General Municipal Election on the same day as the Statewide General Election. The purpose of the City’s General Election is to vote on elected positions of the legislative body and any ballot measures qualified for the ballot. The next General Election will be held November 3, 2026.

District Elections of the Legislative Body
On July 10, 2018, the City Council adopted Ordinance 488 establishing a By-District Election Process in Four Council Districts and an Elective Office of Mayor. The four districts were determined from public meeting input as well as the guidance of a demographer to ensure the required district election criteria were met, after which the Council adopted the final district map. Every 10 years, following the nation's updated U.S. Census, districts must be re-assessed and adjusted to meet the required criteria. Following four public hearings, on March 23, 2022, Council adopted District Map 202, which adjusted the boundaries of Districts 1 and 2. Pursuant to California Elections Code section 10010 and California Government Code sections 34871(C) & 34886, the adopted map and sequence of elections were incorporated. The November 8, 2022 General Election completed the transition to district elections.

This agenda item is before Council to officially call the November 3, 2026 General Municipal Election by adoption of resolutions to this effect and other related election matters. The local ballot would contain the following items:
• Elected Councilmember for District 2
• Elected Councilmember for District 4
DISCUSSION:

Each General Municipal Election requires the passing of Resolutions in order to:

Item J.2
June 24, 2026 Meeting
November 3, 2026 Municipal Election

Page 2 of 6 ends

• Call and Give Notice of the Election listing the elected seats and Determine Tie Vote Provisions (Attachment 1)
• Consolidate the General Municipal Election with the Statewide General Election, whenever possible, and utilize the professional services of the County Registrar of Voters for a number of election duties and tasks, by submitting a formal request to the San Diego County Board of Supervisors (Attachment 2) • Define the regulations for Candidate Statements (Attachment 3) Consolidation with Statewide Election and San Diego County Registrar of Voters Pursuant to California Elections Code 10403, the City must submit a formal request to the San Diego County Board of Supervisors, via resolution, to consolidate the City’s election with the statewide election. Consolidation provides the most cost effective and accurate method of election processes to utilize the proficiency of the San Diego County Registrar of Voters (ROV). When consolidated, the City contracts the services of the ROV to handle multiple requirements for procuring polling places, precinct workers, required postings, printing and mailing of the sample ballot and mail ballots, and canvassing the returns of the election. All other preliminary functions of the election are conducted by the City Clerk, as the local Elections Official.

California Voter’s Choice Act (VCA)
The California Voter’s Choice Act (VCA) modernized elections in California by allowing counties to conduct elections under a model which provides greater flexibility and convenience for voters. This election model allows voters to choose how, when, and where to cast their ballot. In California, every registered voter will automictically receive a ballot in the mail before the election. The VCA also expanded in-person early voting, which allows voters to cast a ballot at any vote center within their county, and provides secure ballot drop-off locations throughout the county.

District Elections of the Legislative Body
The four-year terms of Councilmembers Kristi Becker (District 2) and Jill MacDonald (District 4) expire at the December 2026 Council meeting that will certify the November 2026 election.

Candidates for District 2 and 4 and relative voters can verify their District by checking their voter registration on the San Diego Registrar of Voters website www.sdvote.com Voters living in Districts 2 and 4 will receive a ballot to vote for Council for their designated District.

Candidate Nomination Period and Deadline
The candidate nomination filing period will begin Monday, July 13, 2026, and end on Friday, August 7, 2026, at 5:00 p.m. Candidates should file well before the deadline to allow time to verify signatures and obtain additional signatures if necessary.

Item J.2
June 24, 2026 Meeting
November 3, 2026 Municipal Election

Page 3 of 6 ends

Filers shall make appointments with the City Clerk at the beginning of the candidate filing period, Monday, July 13, 2026. At the appointment, the candidate will have the required nomination document signed and issued to them along with an explanation of other required paperwork to qualify as a candidate for the ballot, including the optional candidate statement and local campaign regulations, etc. Once candidates complete the necessary paperwork, they are asked to make appointments to officially file all required paperwork before the deadline. If certain paperwork is not complete or filed, it may be grounds for insufficiency. Therefore, the earlier the filing takes place, enough time should be allowed for the nomination paper’s required signatures to be verified and, if needed, a Supplemental Nomination Paper to be issued. All paperwork must be filed by the nomination filing deadline of August 7, 2026. The City of Solana Beach has a $25.00 candidate filing fee due at the time of filing.

Potential Filing Extension Date
If any incumbent for Mayor or Councilmember does not file by the filing deadline on August 7th, the filing period will be extended to Wednesday, August 12, 2026, at 5:30 p.m. for candidates other than incumbents.

Candidate Statements
As specified in EC 13307, the Candidate Statement, which is optional for each candidate, includes a brief description of the candidate’s education and qualifications expressed by the candidate. Candidate Statements are prepared on a specified form issued by the Elections Official, printed in the Sample Ballot, and mailed to all registered voters. This optional candidate statement is paid for by the candidate. The estimated charge for the Candidate Statement covers the cost of printing, handling, translating, and inclusion in the Sample Ballot. The estimates are based on varying factors including the number of candidates running, how many other elections take place within the consolidated election, and the number of words allowed in the Candidate Statement, 200 or 400 words.

The City Council chose a 400-word count for the Candidate Statement for the November 2020, 2022, and 2024 Elections; and all prior elections used a 200-word count. It is up to the City Council to determine the word count for the candidate statement for this election.

Whichever word count is authorized by Council will be the required word count for all Candidate Statements. Candidates are required to prepay the established estimated cost when they file the Candidate Statement with all official election papers for candidate qualification and sign an understanding that the charge is an estimate and not the final cost.

Elected Seat Candidate Statement Cost Estimate
200 Word Statement 400 Word Statement
District Councilmember
Candidate $1,300 $1,900
Item J.2
June 24, 2026 Meeting
November 3, 2026 Municipal Election

Page 4 of 6 ends

This estimate is provided by the San Diego County Registrar of Voters, with whom the City contracts to provide certain election services. Candidates will be responsible for any additional cost or will receive a refund, whichever applies, after the accounting of the election is finalized. Resolution 2026-038, as drafted, contemplates a 400-word limit.

Should the Council decide to decrease the Candidate Statement to 200 words, the resolution will be revised accordingly. The City may only choose one for all candidates of this election.

Resolving a Tie Vote
If the election results in a tie vote, there are two options for reconciling the tie. A tie vote may be decided by lot (e.g. tossing a coin, etc.) or by conducting a special runoff election involving those candidates who receive an equal number of votes. The City Council must decide, prior to the election, how to determine the tie vote. Determining the winner of a tie vote using the “by lot” method results in minimal cost to the City.

If the election results in a tie vote and Council elects to opt for a runoff, then an appropriate resolution would be brought back at a later date to call a Special Runoff Election. A Special Runoff Election, held by itself (without consolidation with another statewide election), and contracting these services from the San Diego County Registrar of Voters could cost in excess of $200,000, based on the last estimate provided to the City for a Special Election.

Staff recommends Council determine the resolution of a tie vote using the “by lot” method.

However, if Council determines a Special Runoff Election is the appropriate method, then a resolution would need to be brought back, prior to the election, for adoption.

Cancellation of Candidate Election
In the event that an equal number of qualified candidates do not exceed the number of Council positions to be filled, Elections Code Section 10229 allows Council to make a determination of whether to appoint the candidates in lieu of holding the scheduled election.

Following the nomination period, if the City Clerk discovers that the above circumstance applies, a certificate of facts would be presented to Council at a Council meeting for the determination on whether to appoint the candidates in lieu of placing them on the ballot.

CEQA COMPLIANCE STATEMENT: Not a project as defined by CEQA.

FISCAL IMPACT:

Biennial General Municipal Election costs are incurred through both the City Clerk’s Department and the San Diego County Registrar of Voters. Costs include general noticing, publication requirements, nomination and candidate qualifying materials, ballot-related services, required translations, and other election administration expenses. Registrar of Voters costs vary depending on factors such as the number of contests on the ballot, the number of registered voters, and the services provided for the election.

Item J.2
June 24, 2026 Meeting
November 3, 2026 Municipal Election

Page 5 of 6 ends

The City has budgeted $65,000 for the November 3, 2026 General Municipal Election, which has historically exceeded the actual costs attributable to the City Council races.

Staff requested a preliminary estimate from the San Diego County Registrar of Voters for the November 2026 election assuming two candidates for each of the two Council district offices. As of the time of this report, the City has not yet received the Registrar of Voters’ estimate. The estimate is anticipated to be approximately $35,000 based on the estimate provided for the 2022 Election but would remain subject to change based on the final ballot content and other election-related factors.

WORK PLAN: N/A
OPTIONS:
• Approve Staff recommendation to call the General Election, consolidate with the County, confirm a 400-word candidate statement, and opt for a tie vote decided by lot. • Do not approve the calling of the General Election and return to call a Special Election to comply with the Solana Beach Municipal Code and State of California Codes.

CITY STAFF RECOMMENDATION:

Staff recommends that the City Council:

1. Adopt Resolution 2026-036 Calling and Giving Notice of the Holding of a General Municipal Election to be held on Tuesday, November 3, 2026, for the Election of Certain Officers as required by the Provision of the Laws of the State of California Relating to General Law Cities and determining tie vote provisions.

2. Adopt Resolution 2026-037 requesting the Board of Supervisors of the County of San Diego to Consolidate a General Municipal Election to be held on Tuesday, November 3, 2026, with the Statewide General Election to be held on that date.

3. Adopt Resolution 2026-038 adopting regulations for Candidates for Elective Office pertaining to Candidate’s Statements.
_________________________
Alyssa Muto, City Manager
Attachments:

1. Resolution 2026-036 – Call Election, Reconcile Tie Vote

2. Resolution 2026-037 – Election Consolidation Request Item J.2
June 24, 2026 Meeting
November 3, 2026 Municipal Election

Page 6 of 6 ends

3. Resolution 2026-038 – Candidate Statements
Item J.2
ATTACHMENT 1
RESOLUTION 2026-036

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SOLANA BEACH, CALIFORNIA, CALLING FOR THE

HOLDING OF A GENERAL MUNICIPAL ELECTION TO BE
HELD ON TUESDAY, NOVEMBER 3, 2026, FOR THE

ELECTION OF CERTAIN OFFICERS AS REQUIRED BY THE

PROVISIONS OF THE LAWS OF THE STATE OF
CALIFORNIA RELATING TO GENERAL LAW CITIES.

WHEREAS, under the provisions of the laws relating to General Law cities in the State of California, a General Municipal Election shall be held on November 3, 2026, for the election of municipal officers; and
WHEREAS, it is most beneficial to contract the services of the County of San Diego Registrar of Voters to conduct certain election operations and canvass the returns of said General Municipal Election, and that the City Clerk carry out all other necessary procedures for such election.

NOW, THEREFORE, the City Council of the City of Solana Beach, California, does resolve, declare, determine and order as follows:

SECTION 1. All of the foregoing recitals are true and correct.

SECTION 2. That pursuant to the requirement of the laws of the State of California relating to General Law cities, there is called and ordered to be held in the City of Solana Beach, California, on Tuesday, November 3, 2026, a General Municipal Election for the following purposes:
• Electing a Councilmember from District 2 for a full term of four years; and • Electing a Councilmember from District 4 for a full term of four years.

SECTION 3. That the ballots to be used at the election shall be in form and content as required by law.

SECTION 4. That pursuant to Resolution 2026-037, the election department of the County of San Diego is authorized, instructed and directed to procure and furnish any and all official ballots, notices, printer matter and all supplies, equipment and paraphernalia that may be necessary in order to properly and lawfully conduct the election.

SECTION 5. That the City Council authorizes the City Clerk to administer said election and all reasonable and actual election expenses shall be paid by the City upon presentation of a properly submitted bill.

SECTION 6. That the polls for the election shall be open at 7:00 a.m. on the day of the election and shall remain open continuously from that time until 8:00 p.m. on the Item J.2
Resolution 2026-036
Calling November Election

Page 2 of 2 ends

same day when the polls shall be closed, except as provided in Section 14401 of the Elections Code of the State of California.

SECTION 7. That in all particulars not recited in this resolution, the election shall be held and conducted as provided by law for holding municipal elections.

SECTION 8. That notice of the time and place of holding the election is given and the City Clerk is authorized, instructed and directed to give further or additional notice of the election, in time, form and manner as required by law.

SECTION 9. That in the event of a tie vote (if any two or more persons receive an equal and the highest number of votes for an office) as certified by the San Diego County Registrar of Voters (ROV), the City Council, in accordance with Election Code Section 15651(b), shall set a date, time, and place and summon the candidates who have received the tie votes to appear and will determine the tie by lot.

SECTION 10. That the City Clerk shall certify to the passage and adoption of this resolution and enter it into the book of original resolutions.

PASSED, APPROVED AND ADOPTED at a Regular meeting of the Solana Beach City Council held on the 24th day of June, 2026, by the following vote:

AYES: Councilmembers –
NOES: Councilmembers –
ABSENT: Councilmembers –
ABSTAIN: Councilmembers –
____________________________
LESA HEEBNER, Mayor
APPROVED AS TO FORM: ATTEST:
_________________________________ ____________________________ JOHANNA N. CANLAS, City Attorney ANGELA IVEY, City Clerk Item J.2
ATTACHMENT 2
RESOLUTION 2026-037

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SOLANA BEACH, CALIFORNIA, REQUESTING THE BOARD OF

SUPERVISORS OF THE COUNTY OF SAN DIEGO TO

CONSOLIDATE A GENERAL MUNICIPAL ELECTION TO BE HELD
ON NOVEMBER 3, 2026, WITH THE STATEWIDE GENERAL

ELECTION TO BE HELD ON THAT DATE PURSUANT TO
SECTION 10403 OF THE ELECTIONS CODE
WHEREAS, the City Council of the City of Solana Beach called a General Municipal Election to be held on November 3, 2026, for election of municipal officers for Councilmembers Districts 2 and 4; and
WHEREAS, in the course of conduct of the election it is necessary for the City to request services of the County; and
WHEREAS, all necessary expenses in performing these services shall be paid by the City of Solana Beach; and
WHEREAS, it is desirable that the General Municipal Election be consolidated with the Statewide General Election to be held on the same date and that within the City the precincts, polling places and election officers of the two elections be the same, and that the county election department of the County of San Diego canvass the returns of the General Municipal Election and that the election be held in all respects as if there were only one election.

NOW, THEREFORE, the City Council of the City of Solana Beach, California, does resolve, declare, determine, and order as follows:

SECTION 1. That pursuant to the provisions of Section 10403 of the California Elections Code, the Board of Supervisors of the County of San Diego is hereby requested to consent and agree to the consolidation of a General Municipal Election with the Statewide General Election held Tuesday, November 3, 2026, for the purpose of electing municipal officers for Councilmembers Districts 2 and 4; and
SECTION 2. That the County of San Diego San Diego County Registrar of Voters be authorized to render election services and proceedings including procuring and furnishing any and all official ballots, notices, printed matter and all supplies and equipment and paraphernalia incidental to and connected with the conduct of the subject election as well as canvassing the returns of the General Municipal Election in order to properly and lawfully conduct such election. The election will be held and conducted in accordance with the provisions of law regulating the statewide election.

SECTION 3. That the Board of Supervisors is requested to issue instructions to the San Diego County election department to take any and all steps necessary for the holding of the consolidated election.

Item J.2
Resolution 2026-037
Consolidation of Election

Page 2 of 2 ends

SECTION 4. That the County of San Diego shall be reimbursed in full for the services performed by the San Diego County Registrar of Voters for the City of Solana Beach upon presentation of a proper invoice, and the City agrees to indemnify and save free and harmless the County, its officers, agents and employees from expense or liability, including reasonable attorneys’ fees, as a result of any election contest arising after conduct of this election.

SECTION 5. That in all particulars not recited in this Resolution, the election shall be held and conducted as provided by law for holding municipal elections.

SECTION 6. That notice of the time and place of holding the election is given and the City Clerk is authorized, instructed, and directed to give further or additional notice of the election, in time, form and manner as required by law.

SECTION 5. That the City Clerk is hereby directed to file a certified copy of this Resolution with the Board of Supervisors and the county election department of the County of San Diego.

SECTION 6. That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.

PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council of the City of Solana Beach, California, held on the 24th day of June, 2026, by the following vote:

AYES: Councilmembers –
NOES: Councilmembers –
ABSENT: Councilmembers –
ABSTAIN: Councilmembers –
____________________________
LESA HEEBNER, Mayor
APPROVED AS TO FORM: ATTEST:
__________________________ ______________________________ JOHANNA N. CANLAS, City Attorney ANGELA IVEY, City Clerk Item J.2
ATTACHMENT 3
RESOLUTION 2026-038

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SOLANA

BEACH, CALIFORNIA, ADOPTING REGULATIONS FOR CANDIDATES
FOR ELECTIVE OFFICE PERTAINING TO CANDIDATE’S

STATEMENTS SUBMITTED TO THE VOTERS AT AN ELECTION TO BE HELD ON TUESDAY, NOVEMBER 3, 2026
WHEREAS, Section 13307 of the Elections Code of the State of California provides that the governing body of any local agency adopt regulations pertaining to materials prepared by any candidate for a municipal election, including costs of the candidate's statement.

WHEREAS, Section 13307 requires the elections official to include the written statements of each candidate in the voter information guide, with a Spanish translation in some instances; and WHEREAS, Section 13307 permits the governing body of any local agency to estimate the total cost of printing, handling, translating, mailing, and electronically distributing these candidates’ statements and to require each candidate filing such a statement to pay in advance his or her estimated pro-rata share as a condition of having his or her statement included in the voter information guide.

NOW, THEREFORE, the City of Solana Beach, California, does hereby resolved, declare, determine and order as follows:

SECTION 1. General Provisions. That pursuant to Section 13307 of the Elections Code of the State of California, each candidate for elective office to be voted for at an Election to be held in the City of Solana Beach on November 3, 2026 may prepare a candidate’s statement on an appropriate form provided by the City Clerk. The statement may include the name, age and occupation of the candidate and a brief description of no more than 400 words of the candidate’s education and qualifications expressed by the candidate himself/herself. The statement shall not include party affiliation of the candidate, nor membership or activity in partisan political organizations. The statement is to be filed (in typewritten form) in the office of the City Clerk at the time the candidate’s nomination papers are filed. The statement may be withdrawn, but not changed, during the period for filing nomination papers and until 5:00 p.m. of the next working day after the close of the nomination period.

SECTION 2. Foreign Language Policy
A. Pursuant to the Federal Voting Rights Act, the candidate’s statements are required to be translated in all languages as required. The County is required to translate candidate’s statements into the following languages: Spanish, Tagalog/Filipino, Vietnamese, and Chinese.

B. The County will mail sample ballots and candidates statements in Spanish, Tagalog/Filipino, Vietnamese, and Chinese to only those voters who are on the county voter file as having requested a sample Item J.2
Resolution 2026-038
Candidate’s Statements

Page 2 of 3 ends

ballot in a particular language. The County will make the sample ballots and candidates statements in the required languages available at all voting centers, on the County’s website, and in the Election Official’s office.

SECTION 3. Payment for Candidate’s Statement Submittal
A. Translations:

1. The candidate shall be required to pay for the cost of translating the candidate’s statement into any required foreign language as specified in (A) pursuant to the Federal and/or State law.

B. Printing

1. The candidate shall be required to pay for the cost of printing the candidate’s statement in English in the voter’s pamphlet.

2. The candidate shall be required to pay for the cost of printing the candidate’s statement in a foreign language in the voter’s pamphlet.

SECTION 4. The City Clerk shall estimate the total cost of printing, handling, translating and mailing the candidate’s statements filed pursuant to this section, including costs incurred as a result of complying with the Voting Rights Act of 1965 (as amended), and require each candidate filing a statement to pay in advance to the City of Solana Beach his or her estimated pro rata share as a condition of having his or her statement included in the voter’s pamphlet. The estimate is just an approximation of the actual cost that varies from one election to another election and may be significantly more or less than the estimate, depending on the actual number of candidates filing statements.

Accordingly, the City Clerk is not bound by the estimate and may on a pro rata basis, bill the candidate for additional actual expense or refund any excess paid depending on the final actual cost. In the event of underpayment, the City Clerk shall require the candidate to pay the balance of the cost incurred. In the event of overpayment, the City Clerk shall prorate the excess amount among the candidates and refund the excess amount paid within 30 days of the election or as soon as the final amount is known from the Registrar of Voters.

SECTION 5. Miscellaneous
A) All translations shall be provided by professionally certified translators.

B) The City Clerk shall comply with all recommendations and standards set forth by the California Secretary of State, the San Diego County Registrar Voters, and local municipal codes and regulations, in other matters relating to elections.

C) The formatting of candidate statements shall conform to the standards provided by the San Diego County Registrar of Voters.

SECTION 5. Additional Materials. No candidate will be permitted to include additional materials in the sample ballot package.

SECTION 6. That the City Clerk shall provide each candidate or the candidate’s representative a copy of this Resolution at the time nominating petitions are issued.

Item J.2
Resolution 2026-038
Candidate’s Statements

Page 3 of 3 ends

SECTION 7. That all previous resolutions establishing council policy on payment for candidate’s statements are repealed.

SECTION 8. That this resolution shall apply at the next ensuing municipal election, November 3, 2026, and at each municipal election after that time.

SECTION 9. That the City Clerk shall certify to the passage and adoption of this resolution and enter it into the book of original resolutions.

PASSED AND ADOPTED at a regular meeting of the City Council of the City of Solana Beach, California, held on the 24th day of June, 2026, by the following vote.

AYES: Councilmembers –
NOES: Councilmembers –
ABSENT: Councilmembers –
ABSTAIN: Councilmembers –

____________________________
LESA HEEBNER, Mayor
APPROVED AS TO FORM: ATTEST:
_________________________________ ____________________________ JOHANNA N. CANLAS, City Attorney ANGELA IVEY, City Clerk Item J.2
COUNCIL ACTION:
_______________________________________________________________________ AGENDA ITEM # J.3.

STAFF REPORT

The Gann Initiative (Proposition 4) was passed in November 1979, by the voters of California, becoming a constitutional amendment. This amendment limited the annual growth of state and local government budgets. The amendment establishes FY 1978/79 as the base year and allows the base to increase in future years by the percentage of growth in population and by the increase in the Consumer Price Index or California Per Capita Personal Income (whichever is lower).

Proposition 4 does not limit all appropriations but does limit appropriations financed from "Proceeds of Taxes". "Proceeds of Taxes" include such revenues as property taxes, sales and use taxes, transient occupancy taxes, and most state subventions. Revenues from other sources such as fees, charges for services and federal grants are considered "NonProceeds of Taxes" and are not subject to the Appropriations Limit.

In order to deal with an increasing number of complaints about the restrictions of Proposition 4, and to increase the accountability of local government in adopting their limits, voters approved Proposition 111 in June 1990. Proposition 111 provided new adjustment formulas, which make the Appropriations Limit more responsive to local growth issues.

Proposition 111 also requires an annual review of Appropriations Limit calculations.

The statutes regarding the adoption of the Appropriations Limit are contained in California Government Code Section 7910. The law calls for the adoption of the Appropriations Limit by resolution prior to the fiscal year (FY) in question. Following the passage of Proposition 111, the requirements for adopting the Appropriations Limit were changed requiring a recorded vote of the City Council as to which of the annual adjustment factors had been selected for the ensuing year.

The adoption of the Appropriations Limit is done at a regular meeting or a noticed special meeting. There is no required public hearing or special public notice. Once the Appropriations Limit is adopted, the public has forty-five (45) days from the effective date Item J.3
June 24, 2026
FY 2026/27 Appropriations Limit

Page 2 of 3 ends

of the resolution to initiate judicial action regarding the Appropriations Limit. The adoption of the Appropriations Limit, and any adjustments to it, are deemed to be legislative acts.

This is important to note, in that the courts have determined that a future Legislature/Council may modify the acts of a prior legislative decision without violating Article XIIIB.

This item is before the City Council to consider Resolution 2026-055 (Attachment 1) approving the FY 2026/27 Appropriations Limit.

DISCUSSION:

The FY 2026/27 Appropriations Limit is established by adjusting the current Appropriations Limit for growth in changes in California’s per capita income and population for the City.

Section 7901(b) of the Government Code allows a city to choose between the change in population of the city and the change in population of the County in adjusting the previous year’s Appropriations Limit. These figures are provided by the State of California Department of Finance (Attachment 3). Staff historically has used the change in the County of San Diego’s population, which increased by 0.04%, rather than the change in the City’s population, which decreased by -0.91%.

Section 7901(b) also dictates that the City must select its change in population pursuant to this section annually by a recorded vote of the governing body. Approval of Resolution 2026-055 by the City Council would establish that the City Council chooses to use the County of San Diego’s change in population for the calculation of the Appropriations Limit.

Staff has calculated the City’s Appropriations Limit for FY 2026/27 to be $55,091,152 (Attachment 2). Staff has included the following detail involved in calculating the Appropriations Limit: Schedule A – GANN Limit Calculation, Schedule B - Estimated Revenue and Resource Schedule, and Schedule C - Appropriations Subject to Limit.

Staff has also included the Annual Adjustment Factors for FY 2026/27 (Attachment 3). This schedule lists the California change in per capita personal income, and the changes in both the City’s and County of San Diego’s population that were selected in calculating the Appropriations Limit.

CEQA COMPLIANCE STATEMENT:

Not a project under CEQA.

FISCAL IMPACT:

The FY 2026/27 Appropriations Limit is calculated to be $55,091,152. The amount of the appropriations (proceeds of taxes) that are subject to the limit is $28,627,032. This amount is $26,464,120 under the Appropriations Limit. If the actual receipts of the proceeds of taxes received in FY 2026/27 exceed the Appropriation Limits, then the excess receipts Item J.3
June 24, 2026
FY 2026/27 Appropriations Limit

Page 3 of 3 ends

would have to be refunded within the next two fiscal years, absent a voter approval to increase the limit.

WORK PLAN:

N/A
OPTIONS:
• Approve staff recommendation increasing the City’s Appropriations Limit for FY 2026/27.
• Provide alternative directions.

CITY STAFF RECOMMENDATION:

Staff recommends that the City Council:

1. Adopt Resolution 2026-055 establishing the FY 2026/27 Appropriations Limit in accordance with Article XIIIB of the California Constitution and Government Code Section 7910 and choosing the County of San Diego’s change in population growth to calculate the Appropriations Limit.
_________________________
Alyssa Muto, City Manager
Attachments:

1. Resolution 2026-055

2. Gann Limit Calculation FY 2026/27

3. Annual Adjustment Factors FY 2026/27
Item J.3
ATTACHMENT 1
RESOLUTION 2026-055

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SOLANA BEACH, CALIFORNIA, ESTABLISHING THE FY
2026/27 APPROPRIATIONS LIMIT IN ACCORDANCE WITH

ARTICLE XIIIB OF THE CALIFORNIA CONSTITUTION AND
GOVERNMENT CODE SECTION 7910 AND CHOOSING
THE COUNTY OF SAN DIEGO’S CHANGE IN POPULATION

GROWTH TO CALCULATE THE APPROPRIATIONS LIMIT
WHEREAS, Article XIIIB of the California Constitution was amended June 5, 1990, by Proposition 111 to change the price and population factors that may be used by local jurisdictions in setting their appropriations limit; and WHEREAS, the appropriations limit may increase annually by a factor comprised of the change in population within the local jurisdiction or within the county in which it is located, combined with either the change in California Per Capita Personal Income or the change in the local assessment roll due to local non-residential construction; and WHEREAS, the FY 2026/27 Appropriations Limit for the City of Solana Beach shall be the FY 1987/88 Appropriations Limit adjusted from that year forward by the new growth factors stated in Proposition 111; and
WHEREAS, the City has been provided price and population data from the State Department of Finance; and
WHEREAS, the price factor changes resulting from the change in California Per Capita Income and the change in County population are the factors used for the City of Solana Beach in adjusting its Appropriations Limit.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Solana Beach, California, does hereby resolve as follows:

1. That the foregoing recitations are true and correct.

2. That pursuant to the Government Code Section 7901(b), the City Council chooses to use the County of San Diego’s change in population, as provided by the Department of Finance of the State of California, in calculating the Appropriations Limit for the City of Solana Beach.

3. The Appropriations Limit for the City of Solana Beach for Fiscal Year 2026/27 shall be $55,091,152.

Item J.3
Resolution 2026-055
2026/27 Appropriations Limit

Page 2 of 2 ends

PASSED AND ADOPTED this 24th day of June, 2026, at a regularly scheduled meeting of the City Council of the City of Solana Beach, California by the following vote:

AYES: Councilmembers –
NOES: Councilmembers –
ABSENT: Councilmembers –
ABSTAIN: Councilmembers –

______________________________
LESA HEEBNER, Mayor
APPROVED AS TO FORM: ATTEST:
________________________________ _______________________________ JOHANNA N. CANLAS, City Attorney ANGELA IVEY, City Clerk Item J.3
Appropriations Limit 2025/26 $ 52,471,772
Increase due to California Per Capita Income 4.95% 2,597,353 Subtotal 55,069,124
Increase due to County population growth 0.04% 22,028
Appropriations Limit 2026/27 55,091,152 $
Note: The source of the California per capita income, as well as the change in population, is the State of California Department of Finance's "Price and Population Information" letter dated May 2026
Schedule A
Fiscal Year 2026/27
Gann Limit Calculation
ATTACHMENT 2
Item J.3
Annual Adjustment Factors:

City options:

A. Increase in California per capita income 4.95%
AND
B. City population growth -0.91%
OR
County population growth 0.04%
*Price Factor & Population Information, Typically comes out in early May from DOF* Annual Adjustment Factors
Fiscal Year 2026/27
File: Gann 26-27 Anul Adj Fctrs
ATTACHMENT 3
Item J.3
COUNCIL ACTION:
_______________________________________________________________________ AGENDA ITEM # J.4.

STAFF REPORT

CITY OF SOLANA BEACH
TO: Honorable Mayor and City Councilmembers
FROM: Alyssa Muto, City Manager
MEETING DATE: June 24, 2026
ORIGINATING DEPT: Finance - Rachel Jacobs, Finance Director/City Treasurer SUBJECT: City Council Consideration of Resolution 2026-054 Adopting the Fiscal Year 2026/27 City Investment Policy BACKGROUND:

Pursuant to its own terms, the City’s Investment Policy (Policy) must be reviewed and adopted annually by a resolution of the City Council. The terms of the Policy must be in compliance with the California Government Code (Code) Section 53601.

This item is before the City Council to consider Resolution 2026-054 (Attachment 1) adopting the City’s Investment Policy for Fiscal Year (FY) 2026/27.

DISCUSSION:

The investment policy states the goals of the City’s investment activities, the types of investments allowed by Government Code, and the reporting requirements. The ultimate goal is to enhance the economic status of the City while protecting its pooled cash. The City has determined that its investment goals are, in order of priority:

Compliance, Safety, Liquidity, and Yield.

The proposed Policy (Attachment 2) is not intended to be comprehensive for all situations but instead serves as a guideline for the City Treasurer, under the direction of the City Manager, to assist in the adequate safeguarding of the City’s financial assets. The attached Policy conforms to Code Section 53601. The City’s Policy is more restrictive in terms of allowable investments than what is allowed by the Code.

After review by the City Treasurer and the City’s investment advisors, Chandler Asset Management, Staff has incorporated the recommended changes to the Policy from last year. These edits, which can be seen in the Redline Policy (Attachment 3) were made to align the policy more closely with California Government Code (CGC) and industry updates:
 SB 998 – 1/1/21
 Recommend removing the prohibition on purchasing more than 10% of the outstanding commercial paper of any single issuer.

Item J.4
June 24, 2026
Adoption of FY27 Investment Policy

Page 2 of 3 ends

 This update to CGC also limited the combined issuer exposure for commercial paper and corporate notes to 10%. The City’s investment policy currently has a 5% max CP and 5% max
corporate bond issuer limit so it’s in compliance with CGC.  SB 595 – 1/1/26
 Extends the maximum maturity of commercial paper from 270 days to 397 days from the date of settlement.
 Extends the exemption that allows local agencies to invest in US Government securities that could result in a zero- or negative-interest accrual in the event of, and for the duration of a period of negative market interest rates. This has been extended from 1/1/26 to 1/1/31.

Staff believes the investments allowed under the attached Policy are appropriate for the City. The Policy will be included on the City’s website and, therefore, is subject to public review.

This item was presented to the Budget and Finance Commission on Monday, June 8, 2026, and they provided no further recommendations.

CEQA COMPLIANCE STATEMENT:

Not a project as defined by CEQA.

FISCAL IMPACT:

There are no direct fiscal impacts of the Investment Policy adoption itself; however, there are fiscal impacts to the City due to fees associated with investments as well as potential losses/gains based on the performance of the investment accounts.

WORK PLAN:

Although the Investment Policy is not directly included in the Work Plan, it supports and aligns with its objectives. This policy reinforces the City’s emphasis on prudent management of public funds which aligns with our goals under the General Governance and Fiscal Responsibility actions. This policy reinforces the City's commitment to the Environmental Sustainability and Energy Priority, particularly through the Climate Action Plan Update. This update enhances the City’s climate response by promoting green business initiatives and advancing energy efficiency and decarbonization upgrades for City facilities.

OPTIONS:
 Approve Staff recommendation adopting the City’s Investment Policy for FY 2026/27.
 Approve Staff recommendation adopting the City’s Investment Policy for FY 2026/27 with modifications.

Item J.4
June 24, 2026
Adoption of FY27 Investment Policy

Page 3 of 3 ends

 Do not approve and provide further direction to Staff.

CITY STAFF RECOMMENDATION:

Staff recommends that the City Council:

1. Adopt Resolution 2026-054 (Attachment 1) approving the City’s Investment Policy for FY 2026/27.
_________________________
Alyssa Muto, City Manager
Attachments:

1. Resolution 2026-054

2. City of Solana Beach Investment Policy FY 2026/27

3. City of Solana Beach Investment Policy FY 2026/27 Redline Item J.4
RESOLUTION 2026-054

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

SOLANA BEACH, CALIFORNIA, APPROVING THE CITY
OF SOLANA BEACH’S INVESTMENT POLICY FOR
FISCAL YEAR 2027
WHEREAS, the Legislature of the State of California has declared that the deposit and investment of public funds by local officials and local agencies is an issue of statewide concern (California Government Code Sections 53600.6 and 53630.1); and WHEREAS, the City Council may invest surplus monies not required for the immediate necessities of the local agency in accordance with the provisions of California Government Code Section 53600 et seq. and this policy; and WHEREAS, the City Treasurer of the City of Solana Beach may invest surplus monies not required for the immediate necessities of the local agency in accordance with the provisions of California Government Code Section 53600 et seq. and this policy; and WHEREAS, the City Treasurer of the City of Solana Beach, under the direction of the City Manager, has prepared and submitted a statement of investment policy and such policy, and any changes thereto, have been considered by the City Council at a public meeting.

NOW, THEREFORE, the City Council of the City of Solana Beach, California, does resolves as follows:

1. That the above recitations are true.

2. That the City Council approves the Investment Policy as revised for Fiscal Year 2027.

PASSED AND ADOPTED this 24th day of June, 2026, at a regularly scheduled meeting of the City Council of the City of Solana Beach, California by the following vote:

AYES: Councilmembers –
NOES: Councilmembers –
ABSENT: Councilmembers –
ABSTAIN: Councilmembers –
______________________________
LESA HEEBNER, Mayor
APPROVED AS TO FORM: ATTEST:
________________________________ _______________________________ JOHANNA N. CANLAS, City Attorney ANGELA IVEY, City Clerk Item J.4

CITY OF SOLANA BEACH

STATEMENT OF INVESTMENT POLICY
FISCAL YEAR 2026-27

CITY COUNCIL

MAYOR LESA HEEBNER

DEPUTY MAYOR JILL MACDONALD
COUNCILMEMBER DAVID A. ZITO

COUNCILMEMBER KRISTI BECKER

COUNCILMEMBER JEWEL EDSON

CITY MANAGER CITY TREASURER

ALYSSA MUTO RACHEL JACOBS
ATTACHMENT 2
Item J.4
City of Solana Beach 2026-27 Investment Policy 1

CITY OF SOLANA BEACH
Investment Policy
FISCAL YEAR 2026/27

CONTENTS
I. INTRODUCTION ..................................................................................................... 2 II. OBJECTIVES......................................................................................................... 2 III. SCOPE................................................................................................................. 3 IV. PRUDENCE........................................................................................................... 3 V. DELEGATION OF AUTHORITY.................................................................................. 4 VI. ETHICS AND CONFLICTS OF INTEREST .................................................................... 5 VII. INTERNAL CONTROLS............................................................................................ 5 VIII. AUTHORIZED FINANCIAL INSTITUTIONS, DEPOSITORIES, AND BROKER/DEALERS ........ 5 IX. AUTHORIZED INVESTMENTS ................................................................................... 7 X. PROHIBITED INVESTMENT VEHICLES AND PRACTICES............................................. 13 XI. FOSSIL FUELS RESTRICTION................................................................................ 13 XII. INVESTMENT POOLS/MUTUAL FUNDS ................................................................... 13 XIII. COLLATERALIZATION ........................................................................................... 14 XIV. DELIVERY, SAFEKEEPING AND CUSTODY .............................................................. 15 XV. MAXIMUM MATURITY........................................................................................... 15 XVI. RISK MANAGEMENT AND DIVERSIFICATION............................................................ 15 XVII. REVIEW OF INVESTMENT PORTFOLIO.................................................................... 17 XVIII. PERFORMANCE EVALUATION ............................................................................... 17 XIX. REPORTING........................................................................................................ 17 XX. REVIEW OF INVESTMENT POLICY.......................................................................... 18 APPENDIX A – GLOSSARY OF INVESTMENT TERMS……………………………………………A-1 Item J.4
City of Solana Beach 2026-27 Investment Policy 2
I. INTRODUCTION
The purpose of this document is to outline the City’s policy for the investment of public funds.

It is the policy of the City of Solana Beach, the Solana Beach Public Financing Authority and the Solana Beach Public Facilities Corporation (hereafter referred collectively as the “City”) to predicate their investment policies, procedures and practices upon the limitations placed upon them by the governing legislative bodies. These policies shall have four primary goals:
• To assure compliance with federal, state, and local laws governing the investment of public monies under the control of the City Treasurer. • To protect the principal monies entrusted to the City. • To provide sufficient liquidity to meet normal operating and unexpected expenditures.
• To generate the maximum amount of investment income within the parameters of prudent risk management as defined in this Investment Policy.

This policy is written to incorporate industry best practices and recommendations from sources such as the Government Finance Officers Association (GFOA), California Municipal Treasurers Association (CMTA), California Debt and Investment Advisory Commission (CDIAC) and the Association of Public Treasurers (APT).

II. OBJECTIVES
The City’s overall investment program shall be designed and managed with a degree of professionalism worthy of the public trust. The overriding objectives of the program, after compliance with laws governing the City’s investment, are to preserve principal, provide sufficient liquidity, and manage investment risks, while seeking a market-rate of return.
• SAFETY. The protection of principal is the foremost objective of the investment program. Investments will be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio. To attain this objective, the City will diversify its investments by investing funds among a variety of securities with independent returns.
• LIQUIDITY. The investment portfolio will remain sufficiently liquid to meet all operating requirements that may be reasonably anticipated.

Item J.4
City of Solana Beach 2026-27 Investment Policy 3
• RETURN ON INVESTMENTS. The investment portfolio will be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints for safety and liquidity needs.

III. SCOPE
This policy covers all funds and investment activities under the direct authority of the City, as set forth in the State Government Code, Sections 53600 et seq., with the following exceptions:
• Proceeds of debt issuance shall be invested in accordance with the City’s general investment philosophy as set forth in this policy; however, such proceeds are to be invested pursuant to the permitted investment provisions of their specific bond indentures.
• Any other funds specifically exempted by the City Council.

Funds not included in the policy include the City’s deferred compensation plans (Plans). These Plans will be excluded from the policy under the following circumstances:
i. A third-party administrator administers the plan
ii. Individual plan participants have control over the selection of investments
iii. The City has no fiduciary responsibility to act as a “trustee” for the Plan.

POOLING OF FUNDS
Except for cash in certain restricted and special funds, the City will consolidate cash and reserve balances from all funds to maximize investment earnings and to increase efficiencies with regard to investment pricing, safekeeping and administration. Investment income will be allocated to the various funds based on their respective participation and in accordance with generally accepted accounting principles.

IV. PRUDENCE
Pursuant to California Government Code, Section 53600.3, all persons authorized to make investment decisions on behalf of the City are trustees and therefore fiduciaries subject to the Prudent Investor Standard:
“…all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public Item J.4
City of Solana Beach 2026-27 Investment Policy 4
funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the City, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the City. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law.”
V. DELEGATION OF AUTHORITY
The Treasurer and other authorized persons responsible for managing City funds acting in accordance with written procedures and this investment policy and exercising due diligence shall be relieved of personal responsibility for an individual security’s credit risk or market price changes provided that the Treasurer or other authorized persons acted in good faith. Deviations from expectations of a security’s credit or market risk should be reported to the City Council in a timely fashion and appropriate action should be taken to control adverse developments.

Authority to manage the City’s investment program is derived from California Government Code, Sections 41006 and 53600 et seq.

The City Council is responsible for the management of the City’s funds, including the administration of this investment policy. Management responsibility for the cash management of the City’s funds is hereby delegated to the Treasurer.

The Treasurer will be responsible for all transactions undertaken and will establish a system of procedures and controls to regulate the activities of subordinate officials and employees. Such procedures will include explicit delegation of authority to persons responsible for investment transactions. No person may engage in an investment transaction except as provided under the terms of this policy and the procedures established by the Treasurer.

The City may engage the services of one or more external investment advisers, who are registered under the Investment Advisers Act of 1940, to assist in the management of the City’s investment portfolio in a manner consistent with the City’s objectives. External investment advisers may be granted discretion to purchase and sell investment securities in accordance with this investment policy.

If the City Treasurer is unavailable, then the Senior Accountant, Assistant City Manager, or the City Manager shall authorize the investment transactions, in writing, prior to execution.

Item J.4
City of Solana Beach 2026-27 Investment Policy 5
The City's overall investment program shall be designed and managed with a degree of professionalism that is worthy of the public trust. The City recognizes that in a diversified portfolio, occasional measured losses may be inevitable and must be considered within the context of the overall portfolio’s return and the cash flow requirements of the City.

VI. ETHICS AND CONFLICTS OF INTEREST
All participants in the investment process shall act as custodians of the public trust.

Investment officials shall recognize that the investment portfolio is subject to public review and evaluation. Thus, employees and officials involved in the investment process shall refrain from personal business activity that could create a conflict of interest or the appearance of a conflict with proper execution of the investment program, or which could impair their ability to make impartial investment decisions.

Employees and investment officials shall disclose to the City Manager any material interests in financial institutions with which they conduct business, and they shall further disclose any large personal financial/investment positions that could be related to the performance of the investment portfolio. With regard to the City Manager, the same shall apply and shall be disclosed to the City Treasurer.

VII. INTERNAL CONTROLS
The Treasurer is responsible for establishing and maintaining an internal control structure designed to ensure that the assets of the entity are protected from loss, theft or misuse. The internal control structure shall be designed to provide reasonable assurance that these objectives are met. The concept of reasonable assurance recognizes that (1) the cost of a control should not exceed the benefits likely to be derived; and (2) the valuation of costs and benefits requires estimates and judgments by management.

Periodically, as deemed appropriate by the City and/or the City Council, an independent analysis by an external auditor shall be conducted to review internal controls, account activity and compliance with policies and procedures.

VIII. AUTHORIZED FINANCIAL INSTITUTIONS, DEPOSITORIES, AND BROKER/DEALERS To the extent practicable, the Treasurer shall endeavor to complete investment transactions using a competitive bid process whenever possible. The City’s Treasurer will determine which financial institutions are authorized to provide investment services to the City. It shall be the City’s policy to purchase securities only from authorized institutions and firms.

The Treasurer shall maintain procedures for establishing a list of authorized broker/dealers and financial institutions which are approved for investment purposes that are selected through a process of due diligence as determined by Item J.4
City of Solana Beach 2026-27 Investment Policy 6
the City. Due inquiry shall determine whether such authorized broker/dealers, and the individuals covering the City are reputable and trustworthy, knowledgeable and experienced in Public City investing and able to meet all of their financial obligations. These institutions may include "primary" dealers or regional dealers that qualify under Securities and Exchange Commission (SEC) Rule 15c3-1 (uniform net capital rule).

In accordance with Section 53601.5, institutions eligible to transact investment business with the City include:
• Institutions licensed by the state as a broker-dealer. • Institutions that are members of a federally regulated securities exchange. • Primary government dealers as designated by the Federal Reserve Bank and non-primary government dealers.
• Nationally or state-chartered banks.
• The Federal Reserve Bank.
• Direct issuers of securities eligible for purchase.

Selection of financial institutions and broker/dealers authorized to engage in transactions will be at the sole discretion of the City, except where the City utilizes an external investment adviser in which case the City may rely on the adviser for selection.

All financial institutions which desire to become qualified bidders for investment transactions (and which are not dealing only with the investment adviser) must supply the Treasurer with audited financials and a statement certifying that the institution has reviewed the California Government Code, Section 53600 et seq. and the City’s investment policy. The Treasurer will conduct an annual review of the financial condition and registrations of such qualified bidders.

Public deposits will be made only in qualified public depositories as established by State law. Deposits will be insured by the Federal Deposit Insurance Corporation, or, to the extent the amount exceeds the insured maximum, will be collateralized in accordance with State law.

Selection of broker/dealers used by an external investment adviser retained by the City will be at the sole discretion of the adviser. Where possible, transactions with broker/dealers shall be selected on a competitive basis and their bid or offering prices shall be recorded. If there is no other readily available competitive offering, best efforts will be made to document quotations for comparable or alternative securities. When purchasing original issue instrumentality securities, no Item J.4
City of Solana Beach 2026-27 Investment Policy 7
competitive offerings will be required as all dealers in the selling group offer those securities at the same original issue price.

IX. AUTHORIZED INVESTMENTS
The City’s investments are governed by California Government Code, Sections 53600 et seq. Within the investments permitted by the Code, the City seeks to further restrict eligible investments to the guidelines listed below. In the event a discrepancy is found between this policy and the Code, the more restrictive parameters will take precedence. Percentage holding limits and credit quality minimums listed in this section apply at the time the security is purchased.

Any investment currently held at the time the policy is adopted which does not meet the new policy guidelines can be held until maturity and shall be exempt from the current policy. At the time of the investment’s maturity or liquidation, such funds shall be reinvested only as provided in the current policy.

An appropriate risk level shall be maintained by primarily purchasing securities that are of high quality, liquid, and marketable. The portfolio shall be diversified by security type and institution to avoid incurring unreasonable and avoidable risks regarding specific security types or individual issuers.

1. MUNICIPAL SECURITIES include obligations of the City, the State of California, and any local agency within the State of California, provided that:
• The securities are rated in a rating category of “A” or its equivalent or higher by at least one nationally recognized statistical rating organization (“NRSRO”).
• No more than 5% of the total portfolio may be invested in any single issuer. • No more than 30% of the total portfolio may be in Municipal Securities. • The maximum maturity does not exceed five (5) years.

2. MUNICIPAL SECURITIES (REGISTERED TREASURY NOTES OR BONDS) of any of the other 49 states in addition to California, including bonds payable solely out of the revenues from a revenue-producing property owned, controlled, or operated by a state or by a department, board, agency, or authority of any of the other 49 states, in addition to California.
• The securities are rated in a rating category of “A” or its equivalent or higher by at least one nationally recognized statistical rating organization (“NRSRO”).
• No more than 5% of the total portfolio may be invested in any single issuer. • No more than 30% of the total portfolio may be in Municipal Securities. • The maximum maturity does not exceed five (5) years.

Item J.4
City of Solana Beach 2026-27 Investment Policy 8

3. U.S. TREASURIES and other government obligations for which the full faith and credit of the United States are pledged for the payment of principal and interest.

There are no limits on the dollar amount or percentage that the City may invest in U.S. Treasuries, provided that:
• The maximum maturity is five (5) years.

4. FEDERAL AGENCIES or United States Government-Sponsored Enterprise obligations, participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or United States government-sponsored enterprises. There are no limits on the dollar amount or percentage that the City may invest in Federal City or GovernmentSponsored Enterprises (GSEs), provided that:
• No more than 30% of the total portfolio may be invested in any single City/GSE issuer.
• The maximum maturity does not exceed five (5) years.
• The maximum percentage of callable agencies in the total portfolio is 20%.

5. BANKER’S ACCEPTANCES, provided that:
• They are issued by institutions which have short-term debt obligations rated “A-1” or the equivalent or higher by at least one NRSRO; or long-term debt obligations which are rated in the “A” category or the equivalent or higher by at least one NRSRO.
• No more than 40% of the total portfolio may be invested in Banker’s Acceptances.
• No more than 5% of the total portfolio may be invested in any single issuer. • The maximum maturity does not exceed 180 days.

6. COMMERCIAL PAPER, provided that the securities are issued by an entity that meets all of the following conditions in either paragraph (a) or (b) and other requirements specified below:
a. SECURITIES issued by corporations:
(i) The issuer is organized and operating in the United States with assets more than $500 million.
(ii) The securities are rated “A-1” or its equivalent or higher by at least one NRSRO.
(iii) If the issuer has other debt obligations, they must be rated in a rating category of “A” or its equivalent or higher by at least one NRSRO.

Item J.4
City of Solana Beach 2026-27 Investment Policy 9
b. SECURITIES issued by other entities:
(i) The issuer is organized and operating in the United States as a special purpose corporation, trust, or limited liability company. (ii) The securities must have program-wide credit enhancement including, but not limited to, overcollateralization, letters of credit, or a surety bond.
(iii) The securities are rated “A-1” or its equivalent or higher by at least one NRSRO.
• No more than 25% of the total portfolio may be invested in Commercial Paper.
• No more than 5% of the total portfolio may be invested in any single issuer. • The maximum maturity does not exceed 397 days.

7. NEGOTIABLE CERTIFICATES OF DEPOSIT (NCDS), issued by a nationally or statechartered bank, a savings association, or a federal association, a state or federal credit union, or by a federally licensed or state-licensed branch of a foreign bank, provided that:
• The amount of the NCD insured up to the FDIC limit does not require any credit ratings.
• Any amount above the FDIC insured limit must be issued by institutions which have short-term debt obligations rated “A-1” or the equivalent or higher by at least one NRSRO; or long-term obligations rated in the “A” category or the equivalent or higher by at least one NRSRO. • No more than 30% of the total portfolio may be invested in NCDs (combined with CDARS).
• No more than 5% of the total portfolio may be invested in any single issuer. • The maximum maturity does not exceed five (5) years.

8. FEDERALLY INSURED TIME DEPOSITS (Non-Negotiable Certificates of Deposit) in state or federally chartered banks, savings and loans, or credit unions, provided that:
• The amount per institution is limited to the maximum covered under federal insurance.
• No more than 20% of the total portfolio will be invested in a combination of federally insured and collateralized time deposits.

Item J.4
City of Solana Beach 2026-27 Investment Policy 10
• The maximum maturity does not exceed five (5) years.

9. COLLATERALIZED TIME DEPOSITS (Non-Negotiable Certificates of Deposit) in state or federally chartered banks, savings and loans, or credit unions in excess of insured amounts which are fully collateralized with securities in accordance with California law, provided that:
• No more than 20% of the total portfolio will be invested in a combination of federally insured and collateralized time deposits.
• The maximum maturity does not exceed five (5) years.

10.PLACEMENT SERVICE DEPOSITS, provided that:
• No more than 30% of the total portfolio may be invested in a combination of qualifying placement service deposits.
• The full amount of each deposit along with accrued interest must at all times be insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA).
• Under a provision sunsetting on January 1, 2031, no more than 50% of the portfolio may be invested in deposits through a placement service, including Certificates of Deposit, if the Agency is a city, district or local agency that does not pool money with other local agencies.
• The maximum maturity does not exceed five (5) years.

11.COLLATERALIZED BANK DEPOSITS. City’s deposits with financial institutions will be collateralized with pledged securities per California Government Code, Section 53651.

12.REPURCHASE AGREEMENTS collateralized with securities authorized under California Government Code, maintained at a level of at least 102% of the market value of the Repurchase Agreement. There are no limits on the dollar amount or percentage that the City may invest, provided that:
• Securities used as collateral for Repurchase Agreements will be delivered to an acceptable third party custodian.
• Repurchase Agreements are subject to a Master Repurchase Agreement between the City and the provider of the repurchase agreement. The Master Repurchase Agreement will be substantially in the form developed by the Securities Industry and Financial Markets Association (SIFMA). • The maximum maturity does not exceed one (1) year.

Item J.4
City of Solana Beach 2026-27 Investment Policy 11

13.STATE OF CALIFORNIA LOCAL CITY INVESTMENT FUND (LAIF), provided that:
• The City may invest up to the maximum amount permitted by LAIF. • LAIF’s investments in instruments prohibited by or not specified in the City’s policy do not exclude the investment in LAIF itself from the City’s list of allowable investments, provided LAIF’s reports allow the Treasurer to adequately judge the risk inherent in LAIF’s portfolio.

14.SHARES OF BENEFICIAL INTEREST ISSUED BY A JOINT POWERS AUTHORITY (JPA), provided that:
• The JPA is organized pursuant to California Government Code Section 6509.7 and invests in the securities and obligations authorized in subdivisions (a) to (r), inclusive.
• Each share shall represent an equal proportional interest in the underlying pool of securities owned by the JPA.
• The JPA has retained an investment advisor who is registered with the SEC (or exempt from registration), has assets under management in excess of $500 million, and has at least five years’ experience investing in instruments authorized by Section 53601, subdivisions (a) to (q).

15.CORPORATE MEDIUM TERM NOTES (MTNS), provided that:
• The issuer is a corporation organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States.
• The securities are rated in the “A” category or the equivalent or higher by at least one NRSRO.
• No more than 30% of the total portfolio may be invested in MTNs. • No more than 5% of the total portfolio may be invested in any single issuer. • The maximum maturity does not exceed five (5) years.

16.ASSET-BACKED, MORTGAGE-BACKED, MORTGAGE PASS-THROUGH SECURITIES, AND COLLATERALIZED MORTGAGE OBLIGATIONS from issuers not defined in sections 3 and 4 of the Authorized investments section of this policy, provided that:
• The securities are rated in the “AA” category or the equivalent or higher by a NRSRO.
• No more than 20% of the total portfolio may be invested in these securities.

Item J.4
City of Solana Beach 2026-27 Investment Policy 12
• No more than 5% of the total portfolio may be invested in any single AssetBacked or Commercial Mortgage security issuer. There is no issuer limitation on any Mortgage security where the issuer is the US Treasury or a Federal City/GSE.
• The maximum maturity does not exceed five (5) years.

17.MUTUAL FUNDS AND MONEY MARKET MUTUAL FUNDS that are registered with the Securities and Exchange Commission under the Investment Company Act of 1940, provided that:
a. MUTUAL FUNDS that invest in the securities and obligations as authorized under California Government Code, Section 53601 (a) to (k) and (m) to (q) inclusive and that meet either of the following criteria:

1. Attained the highest ranking or the highest letter and numerical rating provided by not less than two (2) NRSROs; or

2. Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years’ experience investing in the securities and obligations authorized by California Government Code, Section 53601 and with assets under management in excess of $500 million.

3. No more than 10% of the total portfolio may be invested in shares of any one mutual fund.
b. MONEY MARKET MUTUAL FUNDS registered with the Securities and Exchange Commission under the Investment Company Act of 1940 and issued by diversified management companies and meet either of the following criteria:

1. Have attained the highest ranking or the highest letter and numerical rating provided by not less than two (2) NRSROs; or

2. Have retained an investment adviser registered or exempt from registration with the Securities and Exchange Commission with not less than five years’ experience managing money market mutual funds with assets under management in excess of $500 million.

3. No more than 20% of the total portfolio may be invested in the shares of any one Money Market Mutual Fund.
c. No more than 20% of the total portfolio may be invested in these securities.

Item J.4
City of Solana Beach 2026-27 Investment Policy 13
• The securities are rated in the “AA” category or the equivalent or higher by a NRSRO.
• No more than 30% of the total portfolio may be invested in these securities. • No more than 10% of the total portfolio may be invested in any single issuer. • The maximum maturity does not exceed five (5) years.

X. PROHIBITED INVESTMENT VEHICLES AND PRACTICES
• State law notwithstanding, any investments not specifically described herein are prohibited, including, but not limited to futures and options. • In accordance with Government Code, Section 53601.6, investment in inverse floaters, range notes, or mortgage derived interest-only strips is prohibited. • Investment in any security that could result in a zero-interest accrual if held to maturity is prohibited. Under a provision sunsetting on January 1, 2031, securities backed by the U.S. Government that could result in a zero- or negative-interest accrual if held to maturity are permitted. The presence of any of these securities will be promptly reported to the Treasurer. • Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited.
• Purchasing or selling securities on margin is prohibited. • The use of reverse repurchase agreements, securities lending or any other form of borrowing or leverage is prohibited.
• The purchase of foreign currency denominated securities is prohibited. • The purchase of a security with a forward settlement exceeding 45 days from the time of the investment is prohibited.

XI. FOSSIL FUELS RESTRICTION
• The purchase of securities issued by fossil fuel companies that directly source the majority (more than 50%) of their revenue from oil, gas and/or coal production is prohibited.

XII. INVESTMENT POOLS/MUTUAL FUNDS
Item J.4
City of Solana Beach 2026-27 Investment Policy 14
The City shall conduct a thorough investigation of any pool or mutual fund prior to making an investment, and on a continual basis thereafter. The Treasurer shall develop a questionnaire which will answer the following general questions:

1. A description of eligible investment securities, and a written statement of investment policy and objectives.

2. A description of interest calculations and how it is distributed, and how gains and losses are treated.

3. A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited.

4. A description of who may invest in the program, how often, and what size deposit and withdrawal are allowed.

5. A schedule for receiving statements and portfolio listings.

6. Are reserves, retained earnings, etc. utilized by the pool/fund?

7. A fee schedule, and when and how is it assessed.

8. Is the pool/fund eligible for bond proceeds and/or will it accept such proceeds? XIII. COLLATERALIZATION
CERTIFICATES OF DEPOSIT (CDS). The City shall require any commercial bank or savings and loan association to deposit eligible securities with a City of a depository approved by the State Banking Department to secure any uninsured portion of a Non-Negotiable Certificate of Deposit. The value of eligible securities as defined pursuant to California Government Code, Section 53651, pledged against a Certificate of Deposit shall be equal to 150% of the face value of the CD if the securities are classified as mortgages and 110% of the face value of the CD for all other classes of security.

COLLATERALIZATION OF BANK DEPOSITS. This is the process by which a bank or financial institution pledges securities, or other deposits for the purpose of securing repayment of deposited funds. The City shall require any bank or financial institution to comply with the collateralization criteria defined in California Government Code, Section 53651.

REPURCHASE AGREEMENTS. The City requires that Repurchase Agreements be collateralized only by securities authorized in accordance with California Government Code:

Item J.4
City of Solana Beach 2026-27 Investment Policy 15
• The securities which collateralize the repurchase agreement shall be priced at Market Value, including any Accrued Interest plus a margin. The Market Value of the securities that underlie a repurchase agreement shall be valued at 102% or greater of the funds borrowed against those securities. • Financial institutions shall mark the value of the collateral to market at least monthly and increase or decrease the collateral to satisfy the ratio requirement described above.
• The City shall receive monthly statements of collateral.

XIV. DELIVERY, SAFEKEEPING AND CUSTODY
DELIVERY-VERSUS-PAYMENT (DVP). All investment transactions shall be conducted on a delivery-versus-payment basis.

SAFEKEEPING AND CUSTODY. To protect against potential losses due to failure of individual securities dealers, and to enhance access to securities, interest payments and maturity proceeds, all cash and securities in the City’s portfolio shall be held in safekeeping in the City’s name by a third-party custodian, acting as agent for the City under the terms of a custody agreement executed by the bank and the City. All investment transactions will require a safekeeping receipt or acknowledgment generated from the trade. A monthly report will be received by the City from the custodian listing all securities held in safekeeping with current market data and other information.

The only exceptions to the foregoing shall be depository accounts and securities purchases made with: (i) local government investment pools; (ii) time certificates of deposit, and, (iii) money mutual funds, since the purchased securities are not deliverable.

XV. MAXIMUM MATURITY
To the extent possible, investments shall be matched with anticipated cash flow requirements and known future liabilities.

The City will not invest in securities maturing more than five (5) years from the date of trade settlement, unless the City Council has by resolution granted authority to make such an investment.

XVI. RISK MANAGEMENT AND DIVERSIFICATION

MITIGATING CREDIT RISK IN THE PORTFOLIO
Item J.4
City of Solana Beach 2026-27 Investment Policy 16
Credit risk is the risk that a security or a portfolio will lose some or all of its value due to a real or perceived change in the ability of the issuer to repay its debt. The City will mitigate credit risk by adopting the following strategies:
• The diversification requirements included in the “Authorized Investments” section of this policy are designed to mitigate credit risk in the portfolio. • No more than 5% of the total portfolio may be invested in securities of any single issuer, except where the issuer is the US Government, its Agencies and GSEs, an authorized Supranational issuer or where the security is a Money Market Mutual Fund, Local City Investment Fund (LAIF) or other Local Government Investment Pool, or where otherwise specified in this investment policy.
• The City may elect to sell a security prior to its maturity and record a capital gain or loss in order to manage the quality, liquidity or yield of the portfolio in response to market conditions or City’s risk preferences. • If securities owned by the City are downgraded to a level below the quality required by this investment policy, making the security ineligible for additional purchases, the following steps will be taken:
• Any actions taken related to the downgrade by an investment manager will be promptly communicated to the Treasurer.
• If a decision is made to retain the security in the portfolio, the credit situation will be monitored and reported promptly to the City Council.

MITIGATING MARKET RISK IN THE PORTFOLIO
Market risk is the risk that the portfolio value will fluctuate due to changes in the general level of interest rates. The City recognizes that, over time, longer-term portfolios have the potential to achieve higher returns. On the other hand, longerterm portfolios have higher volatility of return. The City will mitigate market risk by providing adequate liquidity for short-term cash needs, and by making longer-term investments only with funds that are not needed for current cash flow purposes.

The City further recognizes that certain types of securities, including variable rate securities, securities with principal paydowns prior to maturity, and securities with embedded options, will affect the market risk profile of the portfolio differently in different interest rate environments. The City, therefore, adopts the following strategies to control and mitigate its exposure to market risk:
• The City will maintain a minimum of six months of budgeted operating expenditures in short term investments to provide sufficient liquidity for expected disbursements.

Item J.4
City of Solana Beach 2026-27 Investment Policy 17
• The maximum stated final maturity of individual securities in the portfolio will be five (5) years, except as otherwise stated in this policy. • The duration of the portfolio will generally be approximately equal to the duration (typically, plus or minus 20%) of a Market Benchmark, an index selected by the City based on the City’s investment objectives, constraints and risk tolerances.

XVII. REVIEW OF INVESTMENT PORTFOLIO
The Treasurer shall periodically, but no less than quarterly, review the portfolio to identify investments that do not comply with this investment policy and establish protocols for reporting major and critical incidences of noncompliance to the City Council.

XVIII. PERFORMANCE EVALUATION
The investment portfolio shall be designed to attain a market-average rate of return throughout budgetary and economic cycles, considering the City’s risk constraints, the cash flow characteristics of the portfolio, and state and local laws, ordinances or resolutions that restrict investments.

The Treasurer shall monitor and evaluate the portfolio’s performance relative to the chosen market benchmark(s), which will be included in the Treasurer’s quarterly report. The Treasurer shall select an appropriate, readily available index to use as a market benchmark.

XIX. REPORTING

MONTHLY REPORTS
Monthly transaction reports will be submitted by the Treasurer to the City Council within 30 days of the end of the reporting period in accordance with California Government Code Section 53607.

QUARTERLY REPORTS
The Treasurer will submit a quarterly investment report to the City Council which provides full disclosure of the City’s investment activities within 45 days after the end of the quarter per Government Code Section 53646(b)(1). These reports will disclose, at a minimum, the following information about the City’s portfolio:

1. An asset listing showing par value, cost, and independent third-party fair market value of each security as of the date of the report, the source of the valuation, type of investment, issuer, maturity date, interest rate and interest rate.

2. Transactions for the period.

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City of Solana Beach 2026-27 Investment Policy 18

3. A description of the funds, investments and programs (including lending programs) managed by contracted parties (i.e. LAIF; investment pools, outside money managers and securities lending agents)

4. A one-page summary report that shows:
a. Average maturity of the portfolio and modified duration of the portfolio; b. Maturity distribution of the portfolio;
c. Percentage of the portfolio represented by each investment category; d. Average portfolio credit quality; and,
e. Time-weighted total rate of return for the portfolio for the prior one month, three months, twelve months and since inception compared to the City’s market benchmark returns for the same periods;

5. A statement of compliance with investment policy, including a schedule of any transactions or holdings which do not comply with this policy or with the California Government Code, including a justification for their presence in the portfolio and a timetable for resolution.

6. A statement that the City has adequate funds to meet its cash flow requirements for the next six months.

ANNUAL REPORTS
A comprehensive annual report will be presented to the City Council. This report will include comparisons of the City’s return to the market benchmark return, suggest policies and improvements that might enhance the investment program, and will include an investment plan for the coming year.

XX. REVIEW OF INVESTMENT POLICY
The investment policy will be reviewed and adopted at least annually within 120 days of the end of the fiscal year, to ensure its consistency with the overall objectives of preservation of principal, liquidity and return, and its relevance to current law and financial and economic trends. Any recommended modifications or amendments shall be presented by Staff to the City Council for their consideration and adoption.

Item J.4
City of Solana Beach 2026-27 Investment Policy Appendix A-1 Appendix A
Glossary of Investment Terms
AGENCIES. Shorthand market terminology for any obligation issued by a governmentsponsored entity (GSE), or a federally related institution. Most obligations of GSEs are not guaranteed by the full faith and credit of the US government. Examples are:

FFCB. The Federal Farm Credit Bank System provides credit and liquidity in the agricultural industry. FFCB issues discount notes and bonds.

FHLB. The Federal Home Loan Bank provides credit and liquidity in the housing market. FHLB issues discount notes and bonds.

FHLMC. Like FHLB, the Federal Home Loan Mortgage Corporation provides credit and liquidity in the housing market. FHLMC, also called “Freddie Mac” issues discount notes, bonds and mortgage pass-through securities.

FNMA. Like FHLB and Freddie Mac, the Federal National Mortgage Association was established to provide credit and liquidity in the housing market. FNMA, also known as “Fannie Mae,” issues discount notes, bonds and mortgage passthrough securities.

GNMA. The Government National Mortgage Association, known as “Ginnie Mae,” issues mortgage pass-through securities, which are guaranteed by the full faith and credit of the US Government.

PEFCO. The Private Export Funding Corporation assists exporters. Obligations of PEFCO are not guaranteed by the full faith and credit of the US government.

TVA. The Tennessee Valley Authority provides flood control and power and promotes development in portions of the Tennessee, Ohio, and Mississippi River valleys. TVA currently issues discount notes and bonds.

ASKED. The price at which a seller offers to sell a security.

ASSET BACKED SECURITIES. Securities supported by pools of installment loans or leases or by pools of revolving lines of credit.

AVERAGE LIFE. In mortgage-related investments, including CMOs, the average time to expected receipt of principal payments, weighted by the amount of principal expected.

BANKER’S ACCEPTANCE. A money market instrument created to facilitate international trade transactions. It is highly liquid and safe because the risk of the trade transaction is transferred to the bank which “accepts” the obligation to pay the investor.

Item J.4
City of Solana Beach 2026-27 Investment Policy Appendix A-2 BENCHMARK. A comparison security or portfolio. A performance benchmark is a partial market index, which reflects the mix of securities allowed under a specific investment policy.

BID. The price at which a buyer offers to buy a security.

BROKER. A broker brings buyers and sellers together for a transaction for which the broker receives a commission. A broker does not sell securities from their own position.

CALLABLE. A callable security gives the issuer the option to call it from the investor prior to its maturity. The main cause of a call is a decline in interest rates. If interest rates decline since an issuer issues securities, it will likely call its current securities and reissue them at a lower rate of interest. Callable securities have reinvestment risk as the investor may receive its principal back when interest rates are lower than when the investment was initially made.

CERTIFICATE OF DEPOSIT (CD). A time deposit with a specific maturity evidenced by a certificate. Large denomination CDs may be marketable.

COLLATERAL. Securities or cash pledged by a borrower to secure repayment of a loan or repurchase agreement. Also, securities pledged by a financial institution to secure deposits of public monies.

COLLATERALIZED MORTGAGE OBLIGATIONS (CMO). Classes of bonds that redistribute the cash flows of mortgage securities (and whole loans) to create securities that have different levels of prepayment risk, as compared to the underlying mortgage securities.

COMMERCIAL PAPER. The short-term unsecured debt of corporations.

COST YIELD. The annual income from an investment divided by the purchase cost.

Because it does not give effect to premiums and discounts which may have been included in the purchase cost, it is an incomplete measure of return.

COUPON. The rate of return at which interest is paid on a bond.

CREDIT RISK. The risk that principal and/or interest on an investment will not be paid in a timely manner due to changes in the condition of the issuer.

CURRENT YIELD. The annual income from an investment divided by the current market value. Since the mathematical calculation relies on the current market value rather than the investor’s cost, current yield is unrelated to the actual return the investor will earn if the security is held to maturity.

DEALER. A dealer acts as a principal in security transactions, selling securities from and buying securities for their own position.

Item J.4
City of Solana Beach 2026-27 Investment Policy Appendix A-3 DEBENTURE. A bond secured only by the general credit of the issuer.

DELIVERY VS. PAYMENT (DVP). A securities industry procedure whereby payment for a security must be made at the time the security is delivered to the purchaser’s agent.

DERIVATIVE. Any security that has principal and/or interest payments which are subject to uncertainty (but not for reasons of default or credit risk) as to timing and/or amount, or any security which represents a component of another security which has been separated from other components (“Stripped” coupons and principal). A derivative is also defined as a financial instrument the value of which is totally or partially derived from the value of another instrument, interest rate, or index.

DISCOUNT. The difference between the par value of a bond and the cost of the bond, when the cost is below par. Some short-term securities, such as T-bills and banker’s acceptances, are known as discount securities. They sell at a discount from par and return the par value to the investor at maturity without additional interest. Other securities, which have fixed coupons, trade at a discount when the coupon rate is lower than the current market rate for securities of that maturity and/or quality.

DIVERSIFICATION. Dividing investment funds among a variety of investments to avoid excessive exposure to any one source of risk.

DURATION. The weighted average time to maturity of a bond where the weights are the present values of the future cash flows. Duration measures the price sensitivity of a bond to changes in interest rates. (See modified duration).

FEDERAL FUNDS RATE. The rate of interest charged by banks for short-term loans to other banks. The Federal Reserve Bank through open-market operations establishes it.

FEDERAL OPEN MARKET COMMITTEE. A committee of the Federal Reserve Board that establishes monetary policy and executes it through temporary and permanent changes to the supply of bank reserves.

JOINT POWERS AUTHORITY (JPA). An entity created by two or more public agencies that share a common goal in order to jointly exercise powers common to all members through a joint powers agreement or contract.

LEVERAGE. Borrowing funds in order to invest in securities that have the potential to pay earnings at a rate higher than the cost of borrowing.

LIQUIDITY. The speed and ease with which an asset can be converted to cash.

LOCAL AGENCY INVESTMENT FUND (LAIF). A voluntary investment fund open to government entities and certain non-profit organizations in California that is managed by the State Treasurer’s Office.

Item J.4
City of Solana Beach 2026-27 Investment Policy Appendix A-4 LOCAL GOVERNMENT INVESTMENT POOL. Investment pools that range from the State Treasurer’s Office Local Agency Investment Fund (LAIF) to county pools, to Joint Powers Authorities (JPAs). These funds are not subject to the same SEC rules applicable to money market mutual funds.

MAKE WHOLE CALL. A type of call provision on a bond that allows the issuer to pay off the remaining debt early. Unlike a call option, with a make whole call provision, the issuer makes a lump sum payment that equals the net present value (NPV) of future coupon payments that will not be paid because of the call. With this type of call, an investor is compensated, or "made whole."
MARGIN. The difference between the market value of a security and the loan a broker makes using that security as collateral.

MARKET RISK. The risk that the value of securities will fluctuate with changes in overall market conditions or interest rates.

MARKET VALUE. The price at which a security can be traded.

MARKING TO MARKET. The process of posting current market values for securities in a portfolio.

MATURITY. The final date upon which the principal of a security becomes due and payable.

An investment’s term or remaining maturity is measured from the settlement date to final maturity.

MEDIUM TERM NOTES. Unsecured, investment-grade senior debt securities of major corporations which are sold in relatively small amounts on either a continuous or an intermittent basis. MTNs are highly flexible debt instruments that can be structured to respond to market opportunities or to investor preferences.

MODIFIED DURATION. The percent change in price for a 100-basis point change in yields.

Modified duration is the best single measure of a portfolio’s or security’s exposure to market risk.

MONEY MARKET. The market in which short-term debt instruments (T-bills, discount notes, commercial paper, and banker’s acceptances) are issued and traded.

MORTGAGE PASS-THROUGH SECURITIES. A securitized participation in the interest and principal cash flows from a specified pool of mortgages. Principal and interest payments made on the mortgages are passed through to the holder of the security.

MUNICIPAL SECURITIES. Securities issued by state and local agencies to finance capital and operating expenses.

MUTUAL FUND. An entity which pools the funds of investors and invests those funds in a set of securities which is specifically defined in the fund’s prospectus. Mutual funds can be invested in various types of domestic and/or international stocks, bonds, Item J.4
City of Solana Beach 2026-27 Investment Policy Appendix A-5 and money market instruments, as set forth in the individual fund’s prospectus. For most large, institutional investors, the costs associated with investing in mutual funds are higher than the investor can obtain through an individually managed portfolio.

NEGOTIABLE CD. A short-term debt instrument that pays interest and is issued by a bank, savings or federal association, state or federal credit union, or state-licensed branch of a foreign bank. Negotiable CDs are traded in a secondary market.

PLACEMENT SERVICE DEPOSITS. A private service that allows local agencies to invest in FDIC-insured deposits with one or more banks, savings and loans, and credit unions located in the United States. IntraFi (formerly known as CDARS) is an example of an entity that provides this service.

PREMIUM. The difference between the par value of a bond and the cost of the bond, when the cost is above par.

PREPAYMENT SPEED. A measure of how quickly principal is repaid to investors in mortgage securities.

PREPAYMENT WINDOW. The time period over which principal repayments will be received on mortgage securities at a specified prepayment speed.

PRIMARY DEALER. A financial institution (1) that is a trading counterparty with the Federal Reserve in its execution of market operations to carry out U.S. monetary policy, and (2) that participates for statistical reporting purposes in compiling data on activity in the U.S. Government securities market.

PRUDENT PERSON (PRUDENT INVESTOR) RULE. A standard of responsibility which applies to fiduciaries. In California, the rule is stated as “Investments shall be managed with the care, skill, prudence and diligence, under the circumstances then prevailing, that a prudent person, acting in a like capacity and familiar with such matters, would use in the conduct of an enterprise of like character and with like aims to accomplish similar purposes.”
REALIZED YIELD. The change in value of the portfolio due to interest received and interest earned and realized gains and losses. It does not give effect to changes in market value on securities, which have not been sold from the portfolio.

REGIONAL DEALER. A financial intermediary that buys and sells securities for the benefit of its customers without maintaining substantial inventories of securities and that is not a primary dealer.

REPURCHASE AGREEMENT. Short-term purchases of securities with a simultaneous agreement to sell the securities back at a higher price. From the seller’s point of view, the same transaction is a reverse repurchase agreement.

Item J.4
City of Solana Beach 2026-27 Investment Policy Appendix A-6 SAFEKEEPING. A service to bank customers whereby securities are held by the bank in the customer’s name.

STRUCTURED NOTE. A complex, fixed income instrument, which pays interest, based on a formula tied to other interest rates, commodities, or indices. Examples include inverse floating rate notes which have coupons that increase when other interest rates are falling, and which fall when other interest rates are rising, and "dual index floaters," which pay interest based on the relationship between two other interest rates - for example, the yield on the ten-year Treasury note minus the Libor rate.

Issuers of such notes lock in a reduced cost of borrowing by purchasing interest rate swap agreements.

SUPRANATIONAL. A Supranational is a multi-national organization whereby member states transcend national boundaries or interests to share in the decision making to promote economic development in the member countries.

TOTAL RATE OF RETURN. A measure of a portfolio’s performance over time. It is the internal rate of return, which equates the beginning value of the portfolio with the ending value; it includes interest earnings, realized and unrealized gains, and losses in the portfolio.

U.S. TREASURY OBLIGATIONS. Securities issued by the U.S. Treasury and backed by the full faith and credit of the United States. Treasuries are considered to have no credit risk and are the benchmark for interest rates on all other securities in the US and overseas. The Treasury issues both discounted securities and fixed coupon notes and bonds.

TREASURY BILLS. All securities issued with initial maturities of one year or less are issued as discounted instruments and are called Treasury bills. The Treasury currently issues three- and six-month T-bills at regular weekly auctions. It also issues “cash management” bills as needed to smooth out cash flows.

TREASURY NOTES. All securities issued with initial maturities of two to ten years are called Treasury notes and pay interest semi-annually.

TREASURY BONDS. All securities issued with initial maturities greater than ten years are called Treasury bonds. Like Treasury notes, they pay interest semi-annually.

VOLATILITY. The rate at which security prices change with changes in general economic conditions or the general level of interest rates.

YIELD TO MATURITY. The annualized internal rate of return on an investment which equates the expected cash flows from the investment to its cost.

Item J.4

CITY OF SOLANA BEACH

STATEMENT OF INVESTMENT POLICY
FISCAL YEAR 20265-267

CITY COUNCIL

MAYOR LESA HEEBNER

DEPUTY MAYOR JILL MACDONALDKRISTI BECKER
COUNCILMEMBER DAVID A. ZITO

COUNCILMEMBER KRISTI BECKERJILL MACDONALD

COUNCILMEMBER JEWEL EDSON

CITY MANAGER CITY TREASURER

ALYSSA MUTO RACHEL JACOBS
ATTACHMENT 3
Item J.4
City of Solana Beach 20265-276 Investment Policy
1 CITY OF SOLANA BEACH
Investment Policy
FISCAL YEAR 20265/276

CONTENTS
I. INTRODUCTION ..................................................................................................... 2 II. OBJECTIVES ......................................................................................................... 2 III. SCOPE................................................................................................................. 3 IV. PRUDENCE ........................................................................................................... 3 V. DELEGATION OF AUTHORITY .................................................................................. 4 VI. ETHICS AND CONFLICTS OF INTEREST .................................................................... 5 VII. INTERNAL CONTROLS ............................................................................................ 5 VIII. AUTHORIZED FINANCIAL INSTITUTIONS, DEPOSITORIES, AND BROKER/DEALERS ........ 5 IX. AUTHORIZED INVESTMENTS ................................................................................... 7 X. PROHIBITED INVESTMENT VEHICLES AND PRACTICES......................................... 1313 XI. FOSSIL FUELS RESTRICTION ................................................................................ 13 XII. INVESTMENT POOLS/MUTUAL FUNDS ............................................................... 1414 XIII. COLLATERALIZATION ....................................................................................... 1414 XIV. DELIVERY, SAFEKEEPING AND CUSTODY .......................................................... 1515 XV. MAXIMUM MATURITY ........................................................................................... 15 XVI. RISK MANAGEMENT AND DIVERSIFICATION............................................................ 15 XVII. REVIEW OF INVESTMENT PORTFOLIO ................................................................ 1717 XVIII. PERFORMANCE EVALUATION ........................................................................... 1717 XIX. REPORTING ........................................................................................................ 17 XX. REVIEW OF INVESTMENT POLICY ..........................................................................18 APPENDIX A – GLOSSARY OF INVESTMENT TERMS……………………………………………A-1 Item J.4
City of Solana Beach 20265-276 Investment Policy
2 I. INTRODUCTION
The purpose of this document is to outline the City’s policy for the investment of public funds.

Item J.4
City of Solana Beach 20265-276 Investment Policy
3 • RETURN ON INVESTMENTS. The investment portfolio will be designed with the objective of attaining a market rate of return throughout budgetary and economic cycles, taking into account the investment risk constraints for safety and liquidity needs.

IV. PRUDENCE
Pursuant to California Government Code, Section 53600.3, all persons authorized to make investment decisions on behalf of the City are trustees and therefore fiduciaries subject to the Prudent Investor Standard:
“…all governing bodies of local agencies or persons authorized to make investment decisions on behalf of those local agencies investing public Item J.4
City of Solana Beach 20265-276 Investment Policy
4 funds pursuant to this chapter are trustees and therefore fiduciaries subject to the prudent investor standard. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the City, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the City. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law.”
V. DELEGATION OF AUTHORITY
The Treasurer and other authorized persons responsible for managing City funds acting in accordance with written procedures and this investment policy and exercising due diligence shall be relieved of personal responsibility for an individual security’s credit risk or market price changes provided that the Treasurer or other authorized persons acted in good faith. Deviations from expectations of a security’s credit or market risk should be reported to the City Council in a timely fashion and appropriate action should be taken to control adverse developments.

Authority to manage the City’s investment program is derived from California Government Code, Sections 41006 and 53600 et seq.

If the City Treasurer is unavailable, then the Senior Accountant, Assistant City Manager, or the City Manager shall authorize the investment transactions, in writing, prior to execution.

Item J.4
City of Solana Beach 20265-276 Investment Policy
5 The City's overall investment program shall be designed and managed with a degree of professionalism that is worthy of the public trust. The City recognizes that in a diversified portfolio, occasional measured losses may be inevitable and must be considered within the context of the overall portfolio’s return and the cash flow requirements of the City.

VI. ETHICS AND CONFLICTS OF INTEREST
All participants in the investment process shall act as custodians of the public trust.

The Treasurer shall maintain procedures for establishing a list of authorized broker/dealers and financial institutions which are approved for investment purposes that are selected through a process of due diligence as determined by Item J.4
City of Solana Beach 20265-276 Investment Policy
6 the City. Due inquiry shall determine whether such authorized broker/dealers, and the individuals covering the City are reputable and trustworthy, knowledgeable and experienced in Public City investing and able to meet all of their financial obligations. These institutions may include "primary" dealers or regional dealers that qualify under Securities and Exchange Commission (SEC) Rule 15c3-1 (uniform net capital rule).

Selection of broker/dealers used by an external investment adviser retained by the City will be at the sole discretion of the adviser. Where possible, transactions with broker/dealers shall be selected on a competitive basis and their bid or offering prices shall be recorded. If there is no other readily available competitive offering, best efforts will be made to document quotations for comparable or alternative securities. When purchasing original issue instrumentality securities, no Item J.4
City of Solana Beach 20265-276 Investment Policy
7 competitive offerings will be required as all dealers in the selling group offer those securities at the same original issue price.

Item J.4
City of Solana Beach 20265-276 Investment Policy
8 3. U.S. TREASURIES and other government obligations for which the full faith and credit of the United States are pledged for the payment of principal and interest.

There are no limits on the dollar amount or percentage that the City may invest in U.S. Treasuries, provided that:
• The maximum maturity is five (5) years.

Item J.4
City of Solana Beach 20265-276 Investment Policy
9 b. SECURITIES issued by other entities:
(i) The issuer is organized and operating in the United States as a special purpose corporation, trust, or limited liability company. (ii) The securities must have program-wide credit enhancement including, but not limited to, overcollateralization, letters of credit, or a surety bond.
(iii) The securities are rated “A-1” or its equivalent or higher by at least one NRSRO.
• City may purchase no more than 10% of the outstanding commercial paper of any single issuer.
• No more than 25% of the total portfolio may be invested in Commercial Paper.
• No more than 5% of the total portfolio may be invested in any single issuer. • The maximum maturity does not exceed 397 270 days.

Item J.4
City of Solana Beach 20265-276 Investment Policy
10 • No more than 20% of the total portfolio will be invested in a combination of federally insured and collateralized time deposits.
• The maximum maturity does not exceed five (5) years.

10. PLACEMENT SERVICE DEPOSITS, provided that:
• No more than 30% of the total portfolio may be invested in a combination of qualifying placement service deposits.
• The full amount of each deposit along with accrued interest must at all times be insured by the Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Administration (NCUA).
• Under a provision sunsetting on January 1, 2031, no more than 50% of the portfolio may be invested in deposits through a placement service, including Certificates of Deposit, if the Agency is a city, district or local agency that does not pool money with other local agencies.
• The maximum maturity does not exceed five (5) years.

11. COLLATERALIZED BANK DEPOSITS. City’s deposits with financial institutions will be collateralized with pledged securities per California Government Code, Section 53651.

12. REPURCHASE AGREEMENTS collateralized with securities authorized under California Government Code, maintained at a level of at least 102% of the market value of the Repurchase Agreement. There are no limits on the dollar amount or percentage that the City may invest, provided that:
• Securities used as collateral for Repurchase Agreements will be delivered to an acceptable third party custodian.
• Repurchase Agreements are subject to a Master Repurchase Agreement between the City and the provider of the repurchase agreement. The Master Repurchase Agreement will be substantially in the form developed by the Securities Industry and Financial Markets Association (SIFMA).

Item J.4
City of Solana Beach 20265-276 Investment Policy
11 • The maximum maturity does not exceed one (1) year.

13. STATE OF CALIFORNIA LOCAL CITY INVESTMENT FUND (LAIF), provided that:
• The City may invest up to the maximum amount permitted by LAIF. • LAIF’s investments in instruments prohibited by or not specified in the City’s policy do not exclude the investment in LAIF itself from the City’s list of allowable investments, provided LAIF’s reports allow the Treasurer to adequately judge the risk inherent in LAIF’s portfolio.

14. SHARES OF BENEFICIAL INTEREST ISSUED BY A JOINT POWERS AUTHORITY (JPA), provided that:
• The JPA is organized pursuant to California Government Code Section 6509.7 and invests in the securities and obligations authorized in subdivisions (a) to (r), inclusive.
• Each share shall represent an equal proportional interest in the underlying pool of securities owned by the JPA.
• The JPA has retained an investment advisor who is registered with the SEC (or exempt from registration), has assets under management in excess of $500 million, and has at least five years’ experience investing in instruments authorized by Section 53601, subdivisions (a) to (q).

15. CORPORATE MEDIUM TERM NOTES (MTNS), provided that:
• The issuer is a corporation organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States.
• The securities are rated in the “A” category or the equivalent or higher by at least one NRSRO.
• No more than 30% of the total portfolio may be invested in MTNs. • No more than 5% of the total portfolio may be invested in any single issuer. • The maximum maturity does not exceed five (5) years.

Item J.4
City of Solana Beach 20265-276 Investment Policy
12 • The securities are rated in the “AA” category or the equivalent or higher by a NRSRO.
• No more than 20% of the total portfolio may be invested in these securities. • No more than 5% of the total portfolio may be invested in any single AssetBacked or Commercial Mortgage security issuer. There is no issuer limitation on any Mortgage security where the issuer is the US Treasury or a Federal City/GSE.
• The maximum maturity does not exceed five (5) years.

17. MUTUAL FUNDS AND MONEY MARKET MUTUAL FUNDS that are registered with the Securities and Exchange Commission under the Investment Company Act of 1940, provided that:
a. MUTUAL FUNDS that invest in the securities and obligations as authorized under California Government Code, Section 53601 (a) to (k) and (m) to (q) inclusive and that meet either of the following criteria:

1. Attained the highest ranking or the highest letter and numerical rating provided by not less than two (2) NRSROs; or

1. Have attained the highest ranking or the highest letter and numerical rating provided by not less than two (2) NRSROs; or

3. No more than 20% of the total portfolio may be invested in the shares of any one Money Market Mutual Fund.
c. No more than 20% of the total portfolio may be invested in these securities.

18. SUPRANATIONALS, provided that:
• Issues are US dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank Item J.4
City of Solana Beach 20265-276 Investment Policy
13 for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank.
• The securities are rated in the “AA” category or the equivalent or higher by a NRSRO.
• No more than 30% of the total portfolio may be invested in these securities. • No more than 10% of the total portfolio may be invested in any single issuer. • The maximum maturity does not exceed five (5) years.

X. PROHIBITED INVESTMENT VEHICLES AND PRACTICES
• State law notwithstanding, any investments not specifically described herein are prohibited, including, but not limited to futures and options. • In accordance with Government Code, Section 53601.6, investment in inverse floaters, range notes, or mortgage derived interest-only strips is prohibited. • Investment in any security that could result in a zero-interest accrual if held to maturity is prohibited. Under a provision sunsetting on January 1, 203126, securities backed by the U.S. Government that could result in a zero- or negative-interest accrual if held to maturity are permitted. The presence of any of these securities will be promptly reported to the Treasurer. • Trading securities for the sole purpose of speculating on the future direction of interest rates is prohibited.
• Purchasing or selling securities on margin is prohibited. • The use of reverse repurchase agreements, securities lending or any other form of borrowing or leverage is prohibited.
• The purchase of foreign currency denominated securities is prohibited. • The purchase of a security with a forward settlement exceeding 45 days from the time of the investment is prohibited.

Item J.4
City of Solana Beach 20265-276 Investment Policy
14 XII. INVESTMENT POOLS/MUTUAL FUNDS
The City shall conduct a thorough investigation of any pool or mutual fund prior to making an investment, and on a continual basis thereafter. The Treasurer shall develop a questionnaire which will answer the following general questions:

1. A description of eligible investment securities, and a written statement of investment policy and objectives.

2. A description of interest calculations and how it is distributed, and how gains and losses are treated.

3. A description of how the securities are safeguarded (including the settlement processes), and how often the securities are priced and the program audited.

4. A description of who may invest in the program, how often, and what size deposit and withdrawal are allowed.

5. A schedule for receiving statements and portfolio listings.

6. Are reserves, retained earnings, etc. utilized by the pool/fund?

7. A fee schedule, and when and how is it assessed.

REPURCHASE AGREEMENTS. The City requires that Repurchase Agreements be collateralized only by securities authorized in accordance with California Government Code:

Item J.4
City of Solana Beach 20265-276 Investment Policy
15 • The securities which collateralize the repurchase agreement shall be priced at Market Value, including any Accrued Interest plus a margin. The Market Value of the securities that underlie a repurchase agreement shall be valued at 102% or greater of the funds borrowed against those securities. • Financial institutions shall mark the value of the collateral to market at least monthly and increase or decrease the collateral to satisfy the ratio requirement described above.
• The City shall receive monthly statements of collateral.

XIV. DELIVERY, SAFEKEEPING AND CUSTODY
DELIVERY-VERSUS-PAYMENT (DVP). All investment transactions shall be conducted on a delivery-versus-payment basis.

XV. MAXIMUM MATURITY
To the extent possible, investments shall be matched with anticipated cash flow requirements and known future liabilities.

The City will not invest in securities maturing more than five (5) years from the date of trade settlement, unless the City Council has by resolution granted authority to make such an investment.

XVI. RISK MANAGEMENT AND DIVERSIFICATION

MITIGATING CREDIT RISK IN THE PORTFOLIO
Item J.4
City of Solana Beach 20265-276 Investment Policy
16 Credit risk is the risk that a security or a portfolio will lose some or all of its value due to a real or perceived change in the ability of the issuer to repay its debt. The City will mitigate credit risk by adopting the following strategies:
• The diversification requirements included in the “Authorized Investments” section of this policy are designed to mitigate credit risk in the portfolio. • No more than 5% of the total portfolio may be invested in securities of any single issuer, except where the issuer is the US Government, its Agencies and GSEs, an authorized Supranational issuer or where the security is a Money Market Mutual Fund, Local City Investment Fund (LAIF) or other Local Government Investment Pool, or where otherwise specified in this investment policy.
• The City may elect to sell a security prior to its maturity and record a capital gain or loss in order to manage the quality, liquidity or yield of the portfolio in response to market conditions or City’s risk preferences. • If securities owned by the City are downgraded to a level below the quality required by this investment policy, making the security ineligible for additional purchases, the following steps will be taken:
• Any actions taken related to the downgrade by an investment manager will be promptly communicated to the Treasurer.
• If a decision is made to retain the security in the portfolio, the credit situation will be monitored and reported promptly to the City Council.

Item J.4
City of Solana Beach 20265-276 Investment Policy
17 • The maximum stated final maturity of individual securities in the portfolio will be five (5) years, except as otherwise stated in this policy. • The duration of the portfolio will generally be approximately equal to the duration (typically, plus or minus 20%) of a Market Benchmark, an index selected by the City based on the City’s investment objectives, constraints and risk tolerances.

XIX. REPORTING

2. Transactions for the period.

Item J.4
City of Solana Beach 20265-276 Investment Policy
18 3. A description of the funds, investments and programs (including lending programs) managed by contracted parties (i.e. LAIF; investment pools, outside money managers and securities lending agents)

6. A statement that the City has adequate funds to meet its cash flow requirements for the next six months.

Item J.4
City of Solana Beach 20265-276 Investment Policy Appendix A-1
Appendix A
Glossary of Investment Terms
AGENCIES. Shorthand market terminology for any obligation issued by a governmentsponsored entity (GSE), or a federally related institution. Most obligations of GSEs are not guaranteed by the full faith and credit of the US government. Examples are:

FFCB. The Federal Farm Credit Bank System provides credit and liquidity in the agricultural industry. FFCB issues discount notes and bonds.

FHLB. The Federal Home Loan Bank provides credit and liquidity in the housing market. FHLB issues discount notes and bonds.

GNMA. The Government National Mortgage Association, known as “Ginnie Mae,” issues mortgage pass-through securities, which are guaranteed by the full faith and credit of the US Government.

PEFCO. The Private Export Funding Corporation assists exporters. Obligations of PEFCO are not guaranteed by the full faith and credit of the US government.

ASKED. The price at which a seller offers to sell a security.

ASSET BACKED SECURITIES. Securities supported by pools of installment loans or leases or by pools of revolving lines of credit.

AVERAGE LIFE. In mortgage-related investments, including CMOs, the average time to expected receipt of principal payments, weighted by the amount of principal expected.

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City of Solana Beach 20265-276 Investment Policy Appendix A-2
BENCHMARK. A comparison security or portfolio. A performance benchmark is a partial market index, which reflects the mix of securities allowed under a specific investment policy.