Agenda packet — City Council and Concurrent Authorities, May 23, 2023 (part 1 of 8)

City Council/Successor Agency to the
Redevelopment Agency/Public
Financing Authority/Parking Authority
Concurrent
City of Stockton
Meeting Agenda - Final
City Council/Successor
Agency of the
Redevelopment
Agency/Public Financing
Authority/Parking Authority
Concurrent Agenda
Council Chamber, City Hall, 425 N. El Dorado
Street, Stockton CA
Tuesday, May 23, 2023 4:00 PM
Closed Session 4:00 PM :: Regular Session 5:30 PM

1. CLOSED SESSION CALL TO ORDER/ROLL CALL

2. ADDITIONS TO CLOSED SESSION AGENDA

3. ANNOUNCEMENT OF CLOSED SESSION

3.1 23-0401 CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION Number of Cases: Four
Name of Case: Davion Barlow, et al. v. Officer Nicholas Fogal, et al., (United States Eastern District Court Case No.
2:22-CV-00551-TLN-DB)
Name of Case: Laura Dinges v. City of Stockton, et al. (San Joaquin County Superior Court Case No.

STK-CV-UPI-2019-17043)
Name of Case: Gerardo Rodriguez Pacheco, et al. v. City of Stockton, et al., (United States Eastern District
Court Case No. 2:20-CV-01404-TLN-KJN)
Name of Case: Kurt Wilson v. City Council of Stockton, et al. (San Joaquin County Superior Court Case No.

STK-CV-UVM-2019-12404)
This Closed Session is authorized pursuant to section 54956.9(d) (1) of the Government Code.

Department: City Attorney

3.2 23-0403 CONFERENCE WITH LABOR NEGOTIATOR
City of Stockton Page 1 Printed on 5/17/2023
1 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final
Recommended Action: Agency Designated Representative: City Manager Harry Black Employee Organizations: Unrepresented Units, Stockton City Employees' Association, Operating Engineer's Local 3, Mid-Management/Supervisory Level Unit, Unrepresented Management/Confidential, Law Department, Stockton Police Management Association, Stockton Firefighters Local 456 International Association of Firefighters, Stockton Fire Management, Stockton Police Officers' Association (SPOA)
This Closed Session is authorized pursuant to section 54957.6(a) of the Government Code.

Department: City Attorney

3.3 23-0405 PUBLIC EMPLOYEE PERFORMANCE EVALUATION:

Recommended Action: City Manager
This Closed Session is authorized pursuant to Government Code section 54957.

Department: City Attorney

3.4 23-0407 PUBLIC EMPLOYEE PERFORMANCE EVALUATION:

Recommended Action: City Attorney
This Closed Session is authorized pursuant to Government Code section 54957.

Department: City Attorney

3.5 23-0409 PUBLIC EMPLOYEE PERFORMANCE EVALUATION:

Recommended Action: City Clerk
This Closed Session is authorized pursuant to Government Code section 54957.

Department: City Attorney

3.6 23-0411 CONFERENCE WITH LEGAL COUNSEL - POTENTIAL LITIGATION Number of Cases: One
Based on existing facts and circumstances, there is significant exposure to litigation pursuant to Government Code section 54956.9(d)(2).

Department: City Attorney

4. CLOSED SESSION PUBLIC COMMENT*
City of Stockton Page 2 Printed on 5/17/2023
2 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final

5. RECESS TO CLOSED SESSION

6. REGULAR SESSION CALL TO ORDER/ROLL CALL

7. INVOCATION/PLEDGE TO FLAG

8. REPORT OF ACTION TAKEN IN CLOSED SESSION

9. ADDITIONS TO REGULAR SESSION AGENDA***

10. RECOGNITIONS, ANNOUNCEMENTS, OR REPORTS

11. PUBLIC COMMENTS* – MATTERS NOT ON THE AGENDA

12. CONSENT AGENDA

12.1 23-0399 RESOLUTION APPROVING THE ADOPTION OF THE

POST-EMPLOYMENT BENEFITS TRUST AGREEMENT BETWEEN
PFM ASSET MANAGEMENT LLC (“PFM”) AS TRUST
ADMINISTRATOR AND PRINCIPAL BANK (“PRINCIPAL BANK”) AS

TRUSTEE
City of Stockton Page 3 Printed on 5/17/2023
3 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final
Recommended Action: RECOMMENDATION
It is recommended that the City Council adopt a resolution to:

1. Authorize the City Manager to execute a five-year professional service agreement with the option of one one-year extension with PFM Asset Management LLC ("PFM") for Plan Administration and Investment Advisory services for the City's Irrevocable Pension 115 Trust;

2. Adopt the Post-Employment Benefits Trust Agreement between PFM as Trust Administrator and Principal Bank as Trustee;

3. Authorize the City Manager, or designee, to execute any Trust-related documents and agreements to signify its adoption including, but not limited to, an Adoption Agreement and Trust Administrative Services Agreement;

4. Approve, ratify, and confirm the appointment of Principal Bank as the Trustee and PFM as the Trust Administrator as of the effective date of the Adoption Agreement; and

5. Accept the Account Agreement between the City and Principal Bank as Trustee.

6. Approve findings pursuant to Stockton Municipal Code 3.68.070 in support of an exception to the competitive bidding process.

It is also recommended that the resolution authorize the City Manager to take appropriate and necessary actions to carry out the purpose and intent of the resolution.

Department: Administrative Services
Proposed Resolution - Agreement with PFM
Exhibit 1 - PFMAM 115 Trust Agreement
Attachments:

12.2 23-0433 AUTHORIZE CONTRACT WITH INFOSEND, INC. FOR UTILITY BILL

PRINTING AND MAILING SERVICES
City of Stockton Page 4 Printed on 5/17/2023
4 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final
Recommended Action: RECOMMENDATION
It is recommended that the City Council approve a motion to:

1. Authorize the City Manager to execute a four-year professional service agreement, with the option to for one one-year extension, with InfoSend, Inc. for utility bill printing and mailing services in an initial not to exceed amount of $3,400,000, but subject to increases pursuant to the agreement.

2. Approve findings which support and justify an exception to the competitive bidding process pursuant to Stockton Municipal Code section

3.68.070(A)(3), where City held a competitive Request for Proposals.

3. Authorize the City Manager, or designee, to take appropriate and necessary actions to carry out the purpose and intent of the motion.

Department: Administrative Services
Attachments: Attachment A - Agreement with InfoSend, Inc.

12.3 23-0487 ACCEPT THE SINGLE AUDIT AND INDEPENDENT AUDITORS’

REPORTS AND THE REPORT ON INTERNAL CONTROLS FOR THE
YEAR ENDED JUNE 30, 2022
Recommended Action: RECOMMENDATION
It is recommended that the City Council accept by motion the Single Audit and Independent Auditors' Reports and the Report on Internal Control Related Matters Identified in the Audit for the year ended June 30, 2022.

Department: Administrative Services
Attachments: Attachment A - 2022 Single Audit and Independent Auditors Reports

12.4 23-0499 APPROVAL OF CITY COUNCIL MINUTES
Recommended Action: RECOMMENDATION
Approve the minutes from the City Council meetings of March 7, 2023, and March 28, 2023, and April 4, 2023
Department: City Clerk
Attachment A - 2023-03-07 Minutes
Attachment B - 2023-03-28 Minutes
Attachment C - 2023-04-04 Minutes
Attachments:

12.5 23-0467 ADOPT A RESOLUTION IDENTIFYING TERMS AND CONDITIONS

FOR FIRE DEPARTMENT ADMINISTRATIVE SUPPRESSION

PERSONNEL COMPENSATION FOR PROVIDING RESPONSE TO

THE CALIFORNIA OFFICE OF EMERGENCY SERVICES INCIDENTS

AWAY FROM THEIR OFFICIAL DUTY STATION OUTSIDE OF THE

CITY OF STOCKTON
City of Stockton Page 5 Printed on 5/17/2023
5 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final
Recommended Action: RECOMMENDATION
It is recommended that the City Council approve and adopt a resolution to add Administrative Fire Battalion Chief, Administrative Fire Captain, Administrative Fire Fighter Engineer, and Administrative Fire Fighter to the current list of approved Fire Department personnel classification titles assigned to mutual aid incident response to the California Office of Emergency Services away from the official duty station outside the City of Stockton and San Joaquin County.

Department: Fire
Attachments: Proposed Resolution

12.6 23-0391 AWARD A CONSTRUCTION CONTRACT TO INSITUFORM

TECHNOLOGIES, LLC FOR THE BROOKSIDE NORTH STORM

PUMP STATION DISCHARGE PIPES REHABILITATION AND AMEND
FISCAL YEAR 2022-23 ANNUAL BUDGET
Recommended Action: RECOMMENDATION
It is recommended that the City Council adopt a resolution to:

1. Approve the filing of Notice of Exemption No. NOE 7-23 under the California Environmental Quality Act (CEQA) for the Brookside North Storm Pump Station Discharge Pipes Rehabilitation, Project No. US20028 (Exhibit 1 to the Resolution).

2. Approve the project Plans and Specifications for the Brookside North Storm Pump Station Discharge Pipes Rehabilitation, Project No. US20028 (Exhibit 2 to the Resolution).

3. Award a construction contract of $173,702 to Insituform Technologies, LLC, of Chesterfield, MO, for the Brookside North Storm Pump Station Discharge Pipes Rehabilitation, Project No. US20028 (Exhibit 3 to the Resolution).

4. Reappropriate funds in the amount of $105,000 from the completed capital project Storm Drain Pump Stations and Forcemains Cathodic Protection Repairs Project US16010 to the Brookside North Storm Pump Station Discharge Pipes Rehabilitation, Project No. US20028.

It is also recommended that the City Manager be authorized to take appropriate and necessary actions to carry out the purpose and intent of this resolution.

Department: Municipal Utilities
Proposed Resolution
Exhibit 1 - Notice of Exemption
Exhibit 2 - Plans & Specifications
Exhibit 3 - Construction Contract
Attachments:

City of Stockton Page 6 Printed on 5/17/2023
6 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final

12.7 23-0413 APPROVE VENDOR POOL LIST FOR PROPERTY NUISANCE

ABATEMENT AND EMERGENCY BOARD-UP SERVICES
Recommended Action: RECOMMENDATION
It is recommended that City Council approve a motion to:

1. Authorize the City Manager to execute a five-year contract with six contractors to establish a vendor pool list providing necessary property nuisance abatement and emergency board-up services.

2. Approve findings pursuant to Stockton Municipal Code Section 3.68.070 in support of an exception to the competitive bidding process; and

3. It is further recommended that the motion authorize the City Manager to take appropriate and necessary actions to carry out the purpose and intent of the motion.

Department: Police
Attachment A - RFSOQ Vendor Ranking
Attachment B - Rotating List Abatement
Attachment C - Rotating List Emergency
Attachment D - Standard Agreement
Attachments:

12.8 23-0365 APPROVE MOTION TO AUTHORIZE ASPHALT CONCRETE COLD PLANING THROUGH DECEMBER 2024
Recommended Action: RECOMMENDATION
It is recommended that the City Council approve a motion to:

1. Approve the specifications for Asphalt Concrete Cold Planing through December 2024, Project No. WD23003.

2. Award a Service Contract in the amount of $352,125 to Pavement Recycling Systems, Inc. of Jurupa Valley, CA, for Asphalt Concrete Cold Planing through December 2024, Project No. WD23003.

3. Authorize the City Manager to execute up to two one-year extensions to this Service Contract.

It is also recommended that the City Manager be authorized to take appropriate and necessary actions to carry out the purpose and intent of this motion.

Department: Public Works
Attachments: Attachment A – Contract with Pavement Recycling Systems

12.9 23-0390 APPROVE MOTION TO AWARD A SERVICE CONTRACT FOR CITY

OF STOCKTON ELEVATOR MAINTENANCE AND REPAIR
City of Stockton Page 7 Printed on 5/17/2023
7 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final

SERVICES
Recommended Action: RECOMMENDATION
It is recommended that the City Council approve a motion to:

1. Award a five-year Service Contract in the amount not to exceed $209,120 to KONE, Inc. of Sacramento, CA, for City of Stockton Elevator Maintenance and Repair Services, Project No. OM-23-087.

2. Approve findings pursuant to Stockton Municipal Code section 3.68.070 in support of an exception to the competitive bidding process.

It is also recommended that the City Manager be authorized to take appropriate and necessary actions to carry out the purpose and intent of this motion.

Department: Public Works
Attachment A - Service Contract
Attachment B - Funding Accounts for Contract
Attachments:

12.10 23-0480 APPROVE A MOTION TO EXECUTE PROFESSIONAL SERVICES

AGREEMENTS WITH DR ASSOCIATES INTERNATIONAL AND THE

GUMSHOE GROUP FOR PRE-EMPLOYMENT BACKGROUND AND

PERSONNEL INVESTIGATION SERVICES
Recommended Action: RECOMMENDATION
It is recommended that the City Council approve a motion to:

1. Authorize the City Manager, or designee, to execute a Professional Services Agreement with DR Associates International to provide preemployment background and personnel investigation services for the City of Stockton Fire and Police Departments in the amount not to exceed $475,000 for a five-year term;

2. Authorize the City Manager, or designee, to execute a Professional Services Agreement with The Gumshoe Group to provide preemployment background and personnel investigation services for the City of Stockton Fire and Police Departments in the amount not to exceed $100,000 for a five-year term;

3. Approve findings that support an exception to the competitive bidding process; and

4. Authorize the City Manager, or designee, to take appropriate and necessary actions to carry out the purpose and intent of this motion.

Department: Fire
Attachment A - DR Associates Agreement
Attachment B - Gumshoe Group Agreement
Attachments:

City of Stockton Page 8 Printed on 5/17/2023
8 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final

13. ADMINISTRATIVE MATTERS

14. UNFINISHED BUSINESS

15. NEW BUSINESS

15.1 23-0523 PRESENTATION ON THE VALLEY LINK RAIL PROJECT Recommended Action: RECOMMENDATION
Informational presentation by the Tri-Valley - San Joaquin Valley Regional Rail Authority on the Valley Link Rail Project.

Department: City Manager
Attachments: PPT - 15.1 - Valley Link Rail Project

15.2 23-0392 APPROVE THE 2023 STOCKTON TOURISM BUSINESS

IMPROVEMENT DISTRICT BUDGET AND SERVICE PLAN, AND
2022 ANNUAL REPORT
Recommended Action: RECOMMENDATION
It is recommended that the Stockton City Council adopt a Resolution:

1. Approving the 2023 Annual Service Plan for the Stockton Tourism Business Improvement District;

2. Approving the 2023 Operating Budget and Assessment for the Stockton Tourism Business Improvement District;

3. Approving the 2022 Annual Report for the Stockton Tourism Business Improvement District; and

4. Authorizing the City Manager, or designee, to take necessary and appropriate actions to carry out the purpose of this resolution.

Department: Economic Development
Proposed Resolution - Visit Stockton
Exhibit 1 - 2023 Annual Service Plan
Exhibit 2 - 2023 Annual Budget
Exhibit 3 - 2022 Annual Report
PPT - 15.2 - Visit Stockton Council Update
Attachments:

15.3 23-0383 CONSIDER BALLOTS FOR THE PROPOSED SAN JOAQUIN AREA

FLOOD CONTROL AGENCY LEVEE CONSTRUCTION AND

MAINTENANCE ASSESSMENT DISTRICT FORMATION AS

RELATED TO CITY-OWNED PROPERTIES
City of Stockton Page 9 Printed on 5/17/2023
9 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final
Recommended Action: RECOMMENDATION
Consider ballots for the proposed San Joaquin Area Flood Control Agency (SJAFCA) Levee Construction and Maintenance Assessment District (LCMA) formation, as related to City-owned properties, and authorize the City Manager to execute ballots for City-owned properties in response to the proposed annual assessment.

Department: City Manager
Attachment A - Summary of Assessments and Map for City of Stockton Parcels Attachment B - City of Stockton Ballots
Attachment C - Ballot Notice and Information Guide
Attachment D - Lower San Joaquin River Feasibility & Environmental Attachment E - LCMA Preliminary Engineer's Report
Proposed Resolution
PPT - 15.3 - SJAFCA - Levee Construction and Maintenance Assessment Attachments:

16. HEARINGS**

16.1 23-0417 HOLD PUBLIC HEARING TO APPROVE THE ANNUAL BUDGET AND ASSESSMENT ROLLS FOR THE 2023-24 HOLIDAY PARK

MAINTENANCE DISTRICT
City of Stockton Page 10 Printed on 5/17/2023
10 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final
Recommended Action: RECOMMENDATION
This scheduled noticed public hearing is being held to consider public comments and testimony regarding the Holiday Park Maintenance District 2023-24 proposed Assessment budget and the levy of assessments.

At the conclusion of the public hearing, if a majority protest does not exist, it is recommended that the City Council adopt a resolution to:

1. Override any and all public hearing protests.

2. Approve the Annual Budget for Holiday Park Budget for FY2023-24.

3. Confirm and approve the assessment of $46,598 for the Holiday Park Maintenance District for FY2023-24.

4. Authorize the City of Stockton Chief Financial Officer to assess those parcels within the assessment district.

5. Certify the assessments meet the requirements pertaining to the levy of annual assessments.

6. Approve a subsidy in the amount of $116,735 from the Strong Communities Fund (210-000) to continue operations and maintenance of the facility.

7. Authorize the City Manager to take appropriate actions to carry out the purpose and intent of the resolution.

Department: Community Services
Attachment A - Holiday Park Budget
Attachment B - Holiday Park Assessment District Map
Proposed Resolution - Holiday Park 2023-2024
PPT - 16.1 - Holiday Park Maintenance District Assessment Attachments:

16.2 23-0275 APPROVE A FINDING FOR ENVIRONMENTAL REVIEW AND ADOPT

A RESOLUTION INTENDING TO AMEND THE GENERAL PLAN

LAND USE MAP AND AN ORDINANCE AMENDING THE STOCKTON

CITYWIDE ZONING MAP FOR COMPLIANCE WITH THE GENERAL

PLAN AND STATE LAW
City of Stockton Page 11 Printed on 5/17/2023
11 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final
Recommended Action: RECOMMENDATION
Staff recommends that the City Council:

1. Find no further environmental review is required per California Environmental Quality Act (CEQA) Guidelines Section 15183 (Consistency with a Community Plan or General Plan); and

2. Approve a Resolution amending the Stockton General Plan Land Use Map for multiple properties; and

3. Adopt an Ordinance amending the Citywide Zoning Map for multiple properties.

It is also recommended that the City Manager be authorized to take appropriate and necessary actions to carry out the purpose and intent of these approvals.

Department: Community Development
Attachment A - Proposed Property Amendment List
Attachment B - Proposed General Plan Land Use Maps of Properties Attachment C - Proposed Zoning Maps of Properties
Attachment D - Neighborhood Meeting Notice
Attachment E - Planning Commission Support Letter
Attachment F - Planning Commission Approved Resolution
Proposed Resolution - GPLU Map
Exhibit 1 - GPLUM
Exhibit 2 - Property List
Ordinance - Proposed Zoning Map Amendments
Exhibit 1- Zoning
Exhibit 2- Property List
PPT - 16.2 - GP Zoning Amendment
Attachments:

16.3 23-0360 PUBLIC HEARING TO ACCEPT THE ECONOMIC DEVELOPMENT SUBSIDY 2022 ANNUAL REPORT
Recommended Action: RECOMMENDATION
It is recommended that the City Council, by motion:

1. Accept the Economic Development Subsidy 2022 Annual Report, which includes all subsidies the City has provided to developers for economic development purposes over $100,000; and

2. Authorize the City Manager to take appropriate and necessary actions to carry out the purpose and intent of this motion.

Department: Community Development
City of Stockton Page 12 Printed on 5/17/2023
12 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final
Attachment A - Government Code 53083
Attachment B - AB 562 Annual Report 2022
PPT - 16.3 - Economic Subsidy Presentation
Attachments:

17. CITY MANAGER'S UPDATE

18. COUNCIL COMMENTS

19. ADJOURNMENT

INFORMATIONAL ITEMS

CERTIFICATE OF POSTING
I declare, under penalty of perjury, that I am employed by the City of Stockton and that I caused this agenda to be posted in the City Hall notice case on May 17, 2023, in compliance with the Brown Act.

Eliza R. Garza, CMC
City Clerk
By: ________________________________
Deputy
City of Stockton Page 13 Printed on 5/17/2023
13 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final

PUBLIC COMMENTS
*Citizens may comment on any subject within the jurisdiction of the City Council/Successor Agency to the Redevelopment Agency/Public Finance Authority/Parking Authority, including items on the Agenda. Each speaker is limited to three minutes. Speakers must submit “Request to Speak” cards to the City Clerk, and be prepared to speak when called. No speaker cards will be received after the close of the Citizen’s Comments portion of the meeting.
**Speakers should hold comments on items listed as a Hearing until the Hearing is opened.

The City of Stockton invites public comments in multiple forms. You provide your comments by using one of these methods:

1. e-Comment - follow the e-comment link on the City's agenda page stockton.granicusideas.com/meetings

2. Email - you may email your comments to [email protected]

3. Voicemail - you can leave a voice message by dialing (209) 937-8459.

4. In-Person Comments - a) Speakers must submit "request to speak cards" to the Clerk prior to the Public Comment portion of the agenda. No speaker cards will be accepted after the close of Public Comment. Please redirect any inquiries to [email protected]. b) Address only issues over which the meeting body has jurisdiction. c) Each speaker will be limited to one 3-minute comment opportunity. Donating time is not authorized. d) Your time will be displayed on the speaker podium for convenience. *All written and voicemail public comments received by the Clerk's Office 90 minutes prior to the meeting start time will be forwarded to the meeting body members as correspondence and attached the minutes. All comments received after that time will be forwarded as correspondence the following business day. ***Additions to the Agenda - Government Code Section 54954.2(b)(2), allows members of the City Council present at the meeting to take immediate action, with either a two-thirds or unanimous vote, to place an item on the agenda that action must be taken and that the item came to the attention of the City subsequent to the agenda being posted.

All proceedings before this meeting body are conducted in English. The City of Stockton does not furnish language interpreters and, if one is needed, it shall be the responsibility of the person needing one.

In accordance with the Americans With Disabilities Act and California Law, it is the policy of the City of Stockton to offer its public programs, services and meetings in a manner that is readily accessible to everyone, including those with disabilities. If you are a person with a disability and require a copy of a public hearing notice, or an agenda and/or agenda packet in an appropriate alternative format; or if you require other accommodation, please contact the Office of the City Clerk located at 425 North El Dorado Street, Stockton, California 95202 during normal business hours or by calling (209) 937-8458, at least 5 days in advance of the hearing/meeting. Advance notification within this guideline will enable the City/Agency to make reasonable arrangements to ensure accessibility.

Materials related to an item on this agenda submitted to City Council after distribution of the agenda packet are available for public inspection in the City Clerk's Office at 425 North El Dorado Street, Stockton, California 95202, during normal business hours. Such documents are also available on the City's website at www.stocktongov.com subject to staff's ability to post the documents before the meeting.

CHALLENGING CITY DECISIONS: The time limit within which to commence any lawsuit or legal challenge to any quasi-adjudicative decision made by the City is governed by Section 1094.6 of the Code of Civil Procedure, unless a shorter limitation period is specified by any other provision. Under Section 1094.6, any lawsuit or legal challenge to any quasi-adjudicative decision made by the City must be filed no later than the 90th day following the date on City of Stockton Page 14 Printed on 5/17/2023
14 City Council/Successor Agency to May 23, 2023
the Redevelopment Agency/Public
Financing Authority/Parking
Authority Concurrent
Meeting Agenda - Final
which such decision becomes final. Any lawsuit or legal challenge, which is not filed within that 90-day period, will be barred. If a person wishes to challenge the nature of the above section in court, they may be limited to raising only those issues they or someone else raised at the meeting described in this notice, or in written correspondence delivered to the City of Stockton, at or prior to the meeting. In addition, judicial challenge may be limited or barred where the interested party has not sought and exhausted all available administrative remedies.

City of Stockton Page 15 Printed on 5/17/2023
15 City of Stockton
Legislation Text
File #: 23-0399, Version: 1

RESOLUTION APPROVING THE ADOPTION OF THE POST-EMPLOYMENT BENEFITS TRUST AGREEMENT BETWEEN PFM ASSET MANAGEMENT LLC (“PFM”) AS TRUST ADMINISTRATOR AND PRINCIPAL BANK (“PRINCIPAL BANK”) AS TRUSTEE

RECOMMENDATION
It is recommended that the City Council adopt a resolution to:

1. Authorize the City Manager to execute a five-year professional service agreement with the option of one one-year extension with PFM Asset Management LLC (“PFM”) for Plan Administration and Investment Advisory services for the City’s Irrevocable Pension 115 Trust;

2. Adopt the Post-Employment Benefits Trust Agreement between PFM as Trust Administrator and Principal Bank as Trustee;

4. Approve, ratify, and confirm the appointment of Principal Bank as the Trustee and PFM as the Trust Administrator as of the effective date of the Adoption Agreement; and

5. Accept the Account Agreement between the City and Principal Bank as Trustee.

6. Approve findings pursuant to Stockton Municipal Code 3.68.070 in support of an exception to the competitive bidding process.

It is also recommended that the resolution authorize the City Manager to take appropriate and necessary actions to carry out the purpose and intent of the resolution.

Summary
The City provides pension benefits through the California Public Employees’ Retirement System (CalPERS). Employee pensions are commonplace in California’s public sector and work as a mechanism to both attract and retain employees for a lifetime of government work. Consequently, this benefit comes with increased employer costs. The annual cost for the upcoming fiscal year 2023- 24 is $42.5 million, up from $34.6 million six years prior. These large outflows of cash are a contributing factor to the decrease in the City’s General Fund reserves, which will hit their lowest levels between 2028 and 2030 according to the City’s Long Range Financial Plan (LRFP).

City of Stockton Page 1 of 5 Printed on 5/16/2023
powered by Legistar™
16 File #: 23-0399, Version: 1
In response to these elevated cost concerns, the City Council established an irrevocable IRS Section 115 Pension Trust in November 2018, with Public Agency Retirement System (“PARS”) as the plan administrator and Union Bank as the Bank Trustee.

The main purpose of any Section 115 Pension Trust is to neutralize the annual budget fluctuations for pension obligations by allowing municipalities to set aside pension-related dollars. It is a fiscal management best practice tool used to pre-fund long-term financial obligations such as retirement benefits. Prefunding these obligations may reduce the City’s long-term pension liabilities.

Additionally, funds set aside in the Section 115 Trust are safeguarded from diversion to other budgetary uses and generally may be invested in a broader range of securities than would typically be permitted for public agency operating funds, potentially increasing earnings for the Section 115 Pension Trust Portfolio. Leveraging unique investment strategies through active investment management to enhance returns will increase predictability in future years and allow the City to use the Trust fund dollars to meet the annual retirement payments. It is estimated that the Trust could provide approximately $11.1 million more in earnings through the end of fiscal year 2038 (per the LRFP) than continuing to hold funds in the City’s investment pool, and this would further reduce the burden on the General Fund and other funds that contribute to CalPERS costs.

The current contract with PARS is set to expire in the coming months, therefore, a request for proposal (RFP) was issued on February 2, 2023. The City received five proposals, and through a competitive procurement process, staff recommends awarding the service contract to PFM Asset Management LLC (“PFM”) for trust administration and investment advisory services for the City’s section 115 pension trust and to adopt a post-employment benefits trust agreement between PFM and Principal Bank as directed trustee and designate the City Trust Administrators.

DISCUSSION
Background
The City has two pension plans with CalPERS: one for Safety employees and the other for Miscellaneous employees. Both have different tiers associated with them based on the employee’s hire date and their prior employment status with a reciprocal public agency.

Funding of CalPERS pensions relies on three sources: employer contributions, employee contributions, and investment earnings on those contributions. To determine the funding levels necessary to pay retiree pensions, CalPERS uses a set of actuarial assumptions (investment earnings, life expectancy, etc.) to estimate contribution levels.

One of the most critical assumptions is the discount rate (rate of return) on investments in the plans.

CalPERS’s current annual discount rate assumption is 6.8 percent. Assuming this rate of return is attained, then funding of pension obligations would be derived 66 percent from investment gains, and 34 percent from contributions by employers and employees. The actual return has been volatile over the past twenty years and averaged 6.9 percent. If the rate of return falls below assumptions, then the plan will require more contributions from its member agencies, including the City of Stockton.

Furthermore, in 2012, the Government Accounting Standards Board (GASB) issued Statement No. 68, Accounting and Financial Reporting for Pensions. GASB 68 requires that governmental employers that sponsor defined benefit plans (e.g., CalPERS) must recognize a net pension liability City of Stockton Page 2 of 5 Printed on 5/16/2023
powered by Legistar™
17 File #: 23-0399, Version: 1
(also known as an unfunded actuarial accrued liability (UAL)) on their balance sheet. This is the difference between the City's total pension liability and actual plan assets. GASB 68 became effective for fiscal years starting on June 15, 2014. The City’s most current audited financial statements for FY 2021-22 presented an unfunded pension liability of approximately $321.9 million.

Fortunately, the Council anticipated much of the CalPERS cost increases and accounted for them in the LRFP. Council acted to plan and pay for the pension obligations through its budgeting and reserve actions, continuing its practice of saving for future costs and continuing its sound fiscal practices post-bankruptcy. The City made its first contribution of approximately $21.2 million to the Section 115 Pension Trust in 2018 with additional contributions since that time. As of the most recent statement, the trust holds approximately $68.5 million.

Present Situation
Section 115 Trust
The current City of Stockton agreement with PARS expires on September 30, 2023. On February 2, 2023, the City advertised a RFP to obtain services to administer the City’s Section 115 irrevocable pension trust. On March 9, 2023, five proposals were received from the following firms:
· Phase II Systems, dba Public Agency Retirement Services · PFM Asset Management LLC
· Keenan and Associates
· TASC
· CalPERS
A Selection Committee ranked all proposals based on each firm’s understanding of the services to be provided, experience providing the service, qualifications of the firm members, recommended approach, and interviews. PFM received the highest ranking based on the noted criteria and was determined to be the most qualified firm for this service.

PFM offers the security of a Private Letter Ruling from the Internal Revenue Service, which assures member agencies their investment returns will be tax-exempt and will work with the City to develop a pension trust policy that will clearly define the investment strategy needed to yield the highest allowable returns while limiting the risk associated to its investments. PFM plan installation services also include:

A. Take over the administration of City’s Section 115 trust with a goal of assisting the client to meet a quick transition timeline from the incumbent, if needed.

B. Offer an IRS-approved irrevocable funding vehicle to provide for the investment of the City’s assets.

C. Provide trust administration, trustee and investment management services.

D. Work directly with City staff to prepare asset allocation guidelines for the trust based upon the City’s investment objectives and risk tolerance parameters.

E. Provide assistance to the City in the effort to effectively manage and position its investment strategies in the time of market volatility.

City of Stockton Page 3 of 5 Printed on 5/16/2023
powered by Legistar™
18 File #: 23-0399, Version: 1
F. Provide education and presentations regarding the pension trust program to City staff and City Council, as requested.

G. Provide quarterly and annual comparative performance analyses and evaluation reports of the investments of the trust.

H. Coordinate all contributions into the trust and process requests for distributions.

Findings
Pursuant to the Stockton Municipal Code Section 3.68.070(A)(3) relating to exceptions to the competitive bidding process, the following proposed findings support the use of an RFP process to select a firm to administer the City’s pension 115 trust plan:

1. A pension trust administrator and investment advisor will provide the City with a clearly defined pension trust policy, sound investment advice and continued education.

2. The City of Stockton does not have staff with the expertise required to administer a pension trust program nor provide investment advice.

3. In determining the most qualified firm, the most important considerations are a firm’s ability to meet the full scope of work, experience with similar scopes of work, and the ability to work in conjunction with City staff to attain the most prudent investment results within the City’s investment trust account.

4. The use of the RFP process is appropriate in this case because it allows staff to evaluate proposals based upon experience and quality of the scope of work rather than solely by cost.

5. The RFP process, which included proposal evaluation with a technical consultant and a review of financial terms and performance, allowed the City to select the firm best suited to administer a pension trust plan.

FINANCIAL SUMMARY
Annual Consultant fees paid to PFM are based on the assets deposited in the Trust.

PFM Assets Under Management Standard Fees in Basis
Point (bps)
Up to $25 million .30%
Next $75 million .15%
Next $150 million .10%
Next $250 million .05%
Over $500 million .02%
Annual Trustee fees paid to Principal Bank are similarly based on assets deposited in the Trust.

Principal Bank Fees Base Fee
$0 - $20 million $5,000
$20 million - $100 million $8,000
Over $100 million Individually priced on a deal-by-deal basis City of Stockton Page 4 of 5 Printed on 5/16/2023
powered by Legistar™
19 File #: 23-0399, Version: 1
This negotiated fee schedule with PFM is inclusive of trust administration and investment management fees and generates substantial savings compared to our current contract fees. The percentage of Basis Points dramatically declines because of larger deposited amounts. Our current contract cost was tiered based on the assets under management for both the administrator and the trustee, which increased the overall cost of managing these funds.

These fees will be deducted from investment earnings and expensed in the City’s Internal ServicePension Fund.

City of Stockton Page 5 of 5 Printed on 5/16/2023
powered by Legistar™
20 Resolution No.

STOCKTON CITY COUNCIL

RESOLUTION APPROVING THE ADOPTION OF THE POST-EMPLOYMENT

BENEFITS TRUST AGREEEMENT BETWEEN PFM ASSET MANAGEMENT LLC (“PFM”) AS TRUST ADMINISTRATOR AND PRINCIPAL BANK (“PRINCIPAL BANK”) AS TRUSTEE
The City Council established an irrevocable IRS Section 115 Pension Trust in November 2018, with Public Agency Retirement System (“PARS”) as the plan administrator and Union Bank as the Bank Trustee. The City made its first total contribution to the plan of approximately $21.2 million in January, February, and March 2018; $7 million, $7 million, and $7.2 million respectively. As of today’s most, recent statement, the trust holds approximately $71 million; and The current contract with PARS is set to expire in the coming months, therefore, a request for proposal (RFP) was issued on February 2, 2023. The City received five proposals of which staff now recommend awarding the service contract to PFM Asset Management LLC (PFM) as the plan administrator and Principal Bank as Trustee for the continued trust administration and investment advisory services for the City’s section 115 pension trust; now, therefore,

BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF STOCKTON, AS FOLLOWS:

1. Authorize the City Manager to execute a five-year professional service agreement with the option of one one-year extension with PFM Asset Management LLC for Plan Administration and Investment Advisory services for the City’s Irrevocable Pension 115 Trust, attached as Exhibit 1 and incorporated herein by this reference.

2. Adopt the Post-Employment Benefits Trust Agreement between PFM Asset Management LLC as Trust Administrator and Principal Bank as Trustee.

3. Authorize the City Manager, or designee, to execute any trust related documents and agreements including, but not limited to, an Adoption Agreement and Trust Administrative Services Agreement.

4. Approve, ratify, and confirm the appointment of Principal Bank as the Trustee and PFM as the Trust Administrator as of the effective date of the Adoption Agreement.

5. Accept the Account Agreement between the City and Principal Bank as Trustee.
21 6. Approve findings pursuant to Stockton Municipal Code 3.68.070 in support of an exception to the competitive bidding process.

7. Authorize the City Manager to take appropriate and necessary actions to carry out the purpose and intent of this Resolution.

PASSED, APPROVED, and ADOPTED May 23, 2023 .

KEVIN J. LINCOLN II
Mayor of the City of Stockton
ATTEST:

ELIZA R. GARZA, CMC
City Clerk of the City of Stockton
22 EXHIBIT 1 23
EXHIBIT 1 24
EXHIBIT 1 25
EXHIBIT 1 26
EXHIBIT 1 27
EXHIBIT 1 28
EXHIBIT 1 29
EXHIBIT 1 30
EXHIBIT 1 31
EXHIBIT 1 32
EXHIBIT 1 33
EXHIBIT 1 34
EXHIBIT 1 35
EXHIBIT 1 36
EXHIBIT 1 37
EXHIBIT 1 38
EXHIBIT 1 39
EXHIBIT 1 40
EXHIBIT 1 41
EXHIBIT 1 42
EXHIBIT 1 43
EXHIBIT 1 44
EXHIBIT 1 45
EXHIBIT 1 46
EXHIBIT 1 47
EXHIBIT 1 48
EXHIBIT 1 49
EXHIBIT 1 50
EXHIBIT 1 51
EXHIBIT 1 52
EXHIBIT 1 53
EXHIBIT 1 54
EXHIBIT 1 55
EXHIBIT 1 56
EXHIBIT 1 57
EXHIBIT 1 58
EXHIBIT 1 59
EXHIBIT 1 60
EXHIBIT 1 61
EXHIBIT 1 62
EXHIBIT 1 63
EXHIBIT 1 64
EXHIBIT 1 65
EXHIBIT 1 66
EXHIBIT 1 67
EXHIBIT 1 68
EXHIBIT 1 69
EXHIBIT 1 70
EXHIBIT 1 71
EXHIBIT 1 72
EXHIBIT 1 73
EXHIBIT 1 74
EXHIBIT 1 75
EXHIBIT 1 76
EXHIBIT 1 77
EXHIBIT 1 78
EXHIBIT 1 79
EXHIBIT 1 80
EXHIBIT 1 81
EXHIBIT 1 82
EXHIBIT 1 83
EXHIBIT 1 84
EXHIBIT 1 85
EXHIBIT 1 86
EXHIBIT 1 87
EXHIBIT 1 88
EXHIBIT 1 89
EXHIBIT 1 90
EXHIBIT 1 91
EXHIBIT 1 92
EXHIBIT 1 93
EXHIBIT 1 94
EXHIBIT 1 95
EXHIBIT 1 96
EXHIBIT 1 97
EXHIBIT 1 98
EXHIBIT 1 99
EXHIBIT 1 100
EXHIBIT 1 101
City of Stockton
Legislation Text
File #: 23-0433, Version: 1
AUTHORIZE CONTRACT WITH INFOSEND, INC. FOR UTILITY BILL PRINTING AND MAILING

SERVICES

RECOMMENDATION
It is recommended that the City Council approve a motion to:

2. Approve findings which support and justify an exception to the competitive bidding process pursuant to Stockton Municipal Code section 3.68.070(A)(3), where City held a competitive Request for Proposals.

3. Authorize the City Manager, or designee, to take appropriate and necessary actions to carry out the purpose and intent of the motion.

Summary
The City annually generates over 1.2 million pages of utility bills, delinquency notices, final termination notices, and miscellaneous accounts receivable invoices. Because this volume is quite high, and specialized equipment is required to produce the various documents, the City contracts for printing and mailing services as a cost-effective means of performing the services. The total estimated annual contract cost of $850,000 includes the costs for printing, paper, envelopes, mail handling, archiving and postage. The annual cost of printing, paper, envelopes, and mail handling is estimated to be $150,000 but can vary depending on the volume of specific units. The cost of postage, estimated to be $700,000 annually, is a pass-through fee and the City will reimburse InfoSend, Inc. (InfoSend) based on actual costs.

The transition plan and complete implementation of utility bill mailing and printing services from the City’s current vendor to InfoSend is estimated to be 90 days.

DISCUSSION
Background
Since 2017, the City has contracted with Kubra America West, Inc. for document laser printing and mailing services. The current contract expires July 31, 2023.

City of Stockton Page 1 of 3 Printed on 5/17/2023
powered by Legistar™
102
File #: 23-0433, Version: 1
Given the City’s document printing & mailing volume, the City seeks a well-established and reliable partner that provides the latest document production and distribution capabilities at a competitive price.

Present Situation
On November 3, 2022, the City released a Request for Proposals (RFP) for Utility Bill Printing and Mailing Services (PUR 23-008). The RFP process ensures a fair and competitive procurement of utility Bill printing and mailing services for the City.

On December 15, 2022, the City received four proposals from the following firms:
· SENDnLINK, Inc.
· Pre-Sort Center of Stockton, Inc.
· InfoSend, Inc.
· Kubra America West, Inc.

Upon reviewing all proposals, the City’s selection committee invited the two most responsive and qualified firms to be interviewed, which included the current vendor. These two firms were rated based on their experience, breadth of service, customer service, stability, interview, and pricing. The selection committee rated InfoSend as the most qualified vendor to provide utility bill printing and mailing services to the City.

In meeting and exceeding the scope of services as required in the RFP, the contract with InfoSend includes:
· Document Processing, Printing, and Mailing - InfoSend will provide high-speed simplex or duplex printing, folding, and insertion; mail finishing and postal service; and web-based tools for tracking and management.
· Online Production Monitoring Portal - Allows for real-time tracking and management of the entire document production print/mail process via web-based process monitoring tools. · Postal Processing Optimization - InfoSend maintains technology and USPS compliance to ensure clients are getting the best postage rates and features from mailings. Infosend utilizes the following methods to ensure clients are mailing with optimal efficiency. o Full Service with Intelligent Mail Barcode (IMb)
o Coding Accuracy Support System (CASS)
o USPS Move Updates (to ensure qualification for presort discounts) o Detached Mailing Unit (DMU)
o Ongoing USPS enhancements
· Document Redesign - Offers a modern document redesign for utility bills and accounts receivable notices at no additional cost to the city.
· Disaster recovery - Multiple print centers will ensure continuous uninterrupted service. · Extensive experience with SunGard/Central Square (the City’s current billing system) utility billing data exports.
· InfoSend manufactures its own standard envelopes ensuring supply and controlling costs by eliminating the middleperson. In addition to envelopes, InfoSend offers a robust Direct City of Stockton Page 2 of 3 Printed on 5/17/2023
powered by Legistar™
103
File #: 23-0433, Version: 1
Communications department that is responsible for internal insert print requests, envelope messaging, and other ad hoc mailers.
· Archiving-Print image archiving with included USPS mail tracking, this will allow secure access to PDF of documents for several months.

Findings
Pursuant to Stockton Municipal Code section 3.68.070(A)(3), City Council may approve findings which support and justify an exception to the competitive bidding process. The following findings support such an exception:

1. Use of the RFP process is appropriate for this Professional Services Agreement because it relies on the evaluation of professional qualifications and performance as the basis for the selection of a vendor, which is a typical practice for this type of work.

2. The City of Stockton does not have the equipment or staff required to effectively administer a Utility bill printing and mailing program.

3. InfoSend, offers comprehensive features and functionality that address the needs and expectations of our customers and the City and is the most highly functional option that will provide the greatest benefit to both customers and staff.

FINANCIAL SUMMARY
The InfoSend contract is based on per unit pricing. Units can vary by mailing and by customer and can include paper, printing, return envelopes and inserts. InfoSend’s pricing will be fixed for the first year of the contract, with future price increases allowed to account for increases in the cost of materials, labor, and other overhead in subsequent contract years. Thus, the annual cost of this service, including postage, based upon existing volume, is expected to increase by material costs and USPS postage rate increases.

The Municipal Utilities Funds (Wastewater 610, Water 600, and Stormwater 620) and the General Fund (100) are used to pay for these services in proportion to the volume of each funding source.

AR Invoice activity paid by the General Fund is approximately $4,000 per year. The total contract costs, including postage, will be approximately $850,000 yearly based on current volumes and postage rates. Appropriations sufficient for these services and anticipated costs are included in the FY 2023-24 Budget of the Administrative Services Department, Revenue Services Division, and the Municipal Utilities Department, Utility Billing Divisions. No additional appropriation is needed for these contract services.

Attachment A - Agreement with InfoSend, Inc.

City of Stockton Page 3 of 3 Printed on 5/17/2023
powered by Legistar™
104
105

EXHIBIT A

STATEMENT OF WORK

1. Project Objectives
Obtain utility bill printing services from the Contractor and maintain efficient use of technology when delivering bills and notices to utility customers.

2. Project Scope
The Contractor shall provide the goods and services as specified in Attachment A. The contractor shall supply materials and have the capability to perform all services required to print and mail utility bills, delinquent notices and various accounts receivable invoices.

3. Notices
Pursuant to Exhibit C – General Terms and Conditions, Paragraph 15 – Notices, the mailing address for all required notices is as follows:

Contractor: Russ Rezai, President City: City of Stockton 4240 East La Palma Avenue Attn: City Manager
Anaheim, CA 92870 425 N. El Dorado Street
Stockton, CA 95202

4. Key Personnel
Senior Account Manager – Nicole Dean, [email protected] 800.955.9330 Client Services Manager – Ebony Crawford, [email protected] 800.955.9330 Client Services Director – Josue Martinez, [email protected] 800.955.9330 Chief Operating Officer – Matt Schmidt, [email protected] 800.955.9330 President – Russ Rezai, [email protected] 800.955.9330 Sales, Contracting – Glen Everroad, [email protected] 949.874.4786

5. Option to Renew
The term of the Agreement may be extended up to one-year renewal by a written amendment executed by both parties. However, the total term of the Agreement including the extended term shall not exceed _5_ years.

ATTACHMENT A 106
InfoSend, Inc. Response to:

BillPrint. eBills. Delivered.

Prepared for:

Due:

Provided by:

An Innovative Outsourcing Partner
Glen Everroad
Government Solutions
[email protected]
Office: 714.993.2690
Mobile: 949.874.4786
Time:

Kelly Law
Territory Sales Manager
[email protected]
Office: 714.993.2690
Mobile: 949.566.3891
Anaheim, CA | Downers Grove, IL | Carrollton, TX | Fort Myers, FL 800.955.9330 | infosend.com
ATTACHMENT 1 ATTACHMENT A 107
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 1 Table of Contents
COVER LETTER............................................................................................................................................... 2 CONTRACT CONSIDERATIONS...................................................................................................................... 5 FINANCIAL STATEMENT ............................................................................................................................... 13 CORPORATE STRUCTURE, ORGANIZATION .............................................................................................. 14 PROPOSAL FEE............................................................................................................................................. 27 SCOPE OF SERVICES................................................................................................................................... 28 ATTACHMENT 1 ATTACHMENT A 108
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 2

COVER LETTER
December 13, 2022
InfoSend, Inc.
4240 E. La Palma Ave.

Anaheim, CA 92807
City of Stockton
Office of The City Clerk, First Floor, City Hall
425 North El Dorado Street,
Stockton, California 95202‐1997
Re: Request For Proposals/Qualifications For Bill Printing, Inserting And Mailing Services To the City of Stockton RFP review committee:

InfoSend Incorporated is pleased to present this response to the City of Stockton based on its RFP PUR 23‐008 For Utility Bill Printing and Mailing services due Thursday, December 15, 2022 at 2:00 PM. InfoSend acknowledges receipt of the City’s Addendum 1. InfoSend’s sales contacts for this RFP are Glen Everroad and Kelly Law, with executive approval provided by Russ Rezai.

InfoSend provides a comprehensive outsourced bill printing, mailing, and eBilling/payments setup to over 750 clients nationwide. InfoSend team is confident that our offering and benefits presented herein will provide the City and its customers with the greatest value in the market today. InfoSend meets or exceeds the requirements specified in the scope of work, and additional to quoting services pertaining to the City’s requirements we have also included supplemental information about our processing setup, data security, and bill print/mail solution. We propose to provide the City’s print and mail services from our Anaheim, CA facility without the use of subcontractors for any portion of the production, including disaster recovery. InfoSend has five production facilities strategically positioned across the country and has provided detail on each location in this response document.

InfoSend (FEIN: 330748516) is a privately held California corporation, incorporated in 1997, with 206 current employees delivering hundreds of millions print/electronic documents across the nation per year. In addition to our CA headquarters, we own and operate production facilities in Illinois, Texas, Florida, and Massachusetts.

InfoSend’s core competencies are information technology, data processing, document formatting, and document production/delivery. The Software as a Service (SaaS) approach allows InfoSend to continually refine its services and equipment without requiring software installation and maintenance at your site.

InfoSend Advantages and Differentiators
• 26+ year expertise in municipal billing/notice printing and mailing, including providing service for over 625 utility and public agency clients. InfoSend is still managed by its founders and is not for sale – a big distinction in this quickly consolidating vendor space. • Extensive experience with SunGard/Central Square utility billing data exports, having worked with these data outputs for many years. We currently have at least 40 clients sending InfoSend data from their Central Square system for processing and print.
• Wholly owned and operated out of 5 regional production facilities. We never use subcontractors to sub excess printing volume out to other vendors.

ATTACHMENT 1 ATTACHMENT A 109
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 3 • 26+ years of expertise working with the USPS, guaranteeing the lowest cost presort and most efficient setup, never marking up postage from USPS rates.
• Excellent account management tools and personnel with continued attention to cost savings. • Offering a modern document redesign for utility bills and accounts receivable notices at no additional cost to the City
• No need to order preprinted stock due to our full color duplex variable printing capabilities and customertargeted messaging. • Capacity to handle both high-volume and low-volume, specialized print and mailing requests with fast turn-around times.
• InfoSend manufactures its own standard envelopes ensuring supply and controlling costs by eliminating the middle man.
• Integrated bill print and mail, electronic bill presentment, and payment processing under one vendor umbrella. One data file input, multiple outputs supporting multi-channel payments! • Specific COVID-19 pandemic protocols to prevent labor shortages and protect employees • PCI Level 1 Compliant and SOC Type I & II Audited
A Note on Contracting
InfoSend respectfully requests the ability to negotiate contract terms with the City of Stockton if selected as the City’s new vendor. We have included contract consideration items following this cover letter which outline the areas where we’d like to add our standard language for review.

InfoSend Efficiencies
As you will note in this RFP response, InfoSend has extensive experience providing municipal utility billing and other document print and mailing services. In our 26 years, we have fine-tuned our offering to maximize efficiencies, provide cost competitive solutions, and excellent service and support.

The first efficiency that we will offer the City of Stockton involves envelope production and pricing. InfoSend is unique in that we have heavily invested in an internal envelope manufacturing division and will manufacture all of the City of Stockton’s envelopes internally. This envelope division was set up approximately 6 years ago as a way to insulate InfoSend from pricing fluctuations and delivery lead time lags that we were experiencing from envelope vendors. We are not experiencing envelope order lead time issues and extreme pricing markup that is currently common from third-party envelope vendors. Additionally the standard envelopes quoted in this RFP response are stocked at each of InfoSend’s 5 production facilities, meaning the City’s jobs can be printed from any of our locations without limitation.

In addition to envelopes, InfoSend offers a robust Direct Communications department that is responsible for internal insert print requests, envelope messaging, and other ad hoc mailers. InfoSend suggests that the City utilize this option in lieu of the insert pickup requirement mentioned in the RFP specifications. Per the Q&A, the City is not currently utilizing pickup of materials at the moment, so we would appreciate the opportunity to dialogue more about the City’s current setup and present our Direct Communications print department as a potential to utilize.

Alongside these cost savings efficiencies, InfoSend is best known in the industry for the outstanding service and support provided to each of our clients. The company was built on providing printing and mailing service for transactional recurring billers with a superior data processing solution, job tracking, and personal account management experience. 26 years on, we have had many clients transition over to our solution backed by our reputation in serving our clients. The City of Stockton will have dedicated contacts during the initial implementation process and after go-live. We have provided a number of references in this response, including two recent utilities that transitioned to InfoSend from the City’s current vendor setup and we encourage you to speak with them for their first-hand approach on working with InfoSend.

ATTACHMENT 1 ATTACHMENT A 110
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 4 Summary
The InfoSend solution is a complete, proven technology practice that includes print/finish/mail services, and an enhanced print and delivery process. InfoSend provides unequalled technical support, based on our proven experience and significant investment in staff and R&D roadmap. We believe that efficiencies can be improved by introducing new thoughts and ideas. We are proud to say that in 26+ years we have never had a client discontinue services with InfoSend due to programming, production, quality, customer service, or operational issues. We think that makes us pretty unique in our industry. We firmly believe that entering into a partnership with the City of Stockton will result in an efficient and cost-effective back office operation. Thank you for this opportunity to present our services.

Sincerely,
Russ Rezai Glen Everroad Kelly Law
President Government Solutions Territory Sales Mgr.

[email protected] [email protected] [email protected] O. 714.993.2690 C. 949.874.4786 C. 949.566.3891
F. 714.993.1306 F. 714.993.1306 F. 714.993.1306
ATTACHMENT 1 ATTACHMENT A 111
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 6 ATTACHMENT 1 ATTACHMENT A 112
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 7 ATTACHMENT 1 ATTACHMENT A 113
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 8 ATTACHMENT 1 ATTACHMENT A 114
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 9 ATTACHMENT 1 ATTACHMENT A 115
In
foSend,Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail| 10

REFERENCES
ATTACHMENT 1 ATTACHMENT A 116
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 11 Provide a list of references with current contact person, e‐mail address and phone number who may be contacted regarding firm performance. The review team will conduct a background reference review of each respondent. Please include the following information for three (3) projects that the proposed consultant team worked on together: A. Name of the Project/Study B. Location of the Project C. Name, title, and contact information for the client. D. Project Budget E. Date of Completion of the Project Truckee Meadows Water Authority 775.834.8265
1355 Capital Blvd Chris Maciejewski MIS Analyst
Reno, NV 89502 [email protected]
• Contracted Since: 2019
• Billing System: Tyler
• Volume: Approximately 69,000 Mail Pieces Monthly
• InfoSend Products Used: Data Processing Print and Mail Truckee Meadows was previously contracted with Kubra for utility bill printing and mailing service, and switched to InfoSend for customer service-related issues.

City of San Jose, CA Alex Rojas - 408.535.3507
Richard Eng - 408.975.3786
777 N First St Ste 300 Alex Rojas, Senior Investigator Collector Richard Eng, Program Manager - Finance
San Jose, CA 95112-6351 [email protected]
[email protected]
• Contracted Since: 2021
• Billing System: Peoplesoft
• Volume: 21,500 statements, monthly
• InfoSend Products Used: Data Processing Print and Mail The City of San Jose previously outsourced utility, tax, and A/R billing to Kubra for printing and mail. San Jose selected InfoSend as its vendor after competitive RFP in 2021.

City of Tucson, AZ 520.837.2146
481 W Paseo Redondo Nancy Gradillas, Naviline Billing System Manager Tucson, AZ 85701 [email protected]
• Contracted Since: 2012
• Billing System: SunGard HTE
• Volume: Approximately 260,000 statements/notices, monthly • InfoSend Products Used: Data Processing Print and Mail, Print Image Archiving ATTACHMENT 1 ATTACHMENT A 117
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 12 InfoSend performs data processing, print and mail operations for the City of Tucson using full - color variable digital printing technology. Monthly output is 260,000 statements.

Coachella Valley Water District 760.398.2651
85-995 Avenue 52 Scott Burritt, Management Analyst
Coachella, CA 92236 [email protected]
"InfoSend provides us with excellent and responsive service and are our partner in customer billing and communications, we thank them for all they do.” Scott Burritt, Management Analyst • Contracted Since: 2006
• Billing System: SunGard Naviline
• Volume: 110,000 documents monthly
• InfoSend Products Used: Data Processing Print and Mail, Print Image Archive Coachella Valley Water District has Print + Mail services for the District’s water bills, delinquent notices and special announcements. InfoSend includes a usage bar graph and special notice for high use customers.

City of Oxnard, CA 805.385.7811
251 S. Hayes Ave. Eden Alomeri, Assistant City Treasurer/Revenue Accounting Manager
Oxnard, CA 93030 [email protected]
• Contracted Since: 2012
• Billing System: SunGard/Superion
• Volume: Approximately 45,000+ Mail Pieces Monthly
• InfoSend Products Used: Data Processing Print and Mail ATTACHMENT 1 ATTACHMENT A 118
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 13

FINANCIAL STATEMENT
The Proponent must be able to demonstrate a good record of performance and have sufficient financial resources to ensure that they can satisfactorily provide the services required herein. Proponent shall submit a full and detailed presentation of the true condition of the Proponent’s assets, liabilities and net worth. The report should include a balance sheet and income statement. If the Proponent is a new partnership or joint venture, individual financial statements must be submitted for each general partner or joint venture thereof. If firm is a publicly held corporation, the most current annual report should be submitted.

We have provided our most recent audited financial statements at the end of this response.

Any Proponent who, at the time of submission, is involved in an ongoing bankruptcy as a debtor, or in a reorganization, liquidation, or dissolution proceeding, or if a trustee or receiver has been appointed over all or a substantial portion of the property of the Proponent under federal bankruptcy law or any state insolvency, may be declared non‐responsive.

InfoSend is a financially solvent company that does not meet any of the above criteria for unresponsiveness.

ATTACHMENT 1 ATTACHMENT A 119
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 14

CORPORATE STRUCTURE, ORGANIZATION
Describe how your firm is organized, noting major divisions and any parent/holding companies, as well as brief history of the firm and all personnel potentially to be involved in the project including all subconsultants.

Get to Know InfoSend - A Reliable Partner
InfoSend has provided business process outsourcing services since 1996, handling the processing and distribution of over 250 million critical documents annually for industries throughout the United States. Utilizing the most current technology, InfoSend's Customer Engagement platform offers a single source provider to reach customers with effective and timely interactions.

InfoSend's Customer Communications Management (CCM) platform distributes critical documents across multiple channels, including InfoSend's own manufacturing environments in California, Texas, Illinois and Florida for Data Processing, Printing and Mailing (DPPM). InfoSend's hosted Electronic Billing, Presentment and Payment (EBPP) applications drive the customer remittance process with web, IVR, SMS and Bank BillPay payments. The cloud-based, Software as a Service (SaaS) approach allows InfoSend to refine offerings without client-side installed software or maintenance, as well as providing for flexible integrations to existing systems or vendors.

Integrity is at the core of InfoSend, with a stated goal to retain and provide complete satisfaction for each client.

InfoSend has over 200 employees across multiple states, and the company culture has led to high employee retention, affording clients familiarity and quality service. From our internal operations, to how we support our valuable clients, InfoSend's client-focused service has led to an industry-leading client retention and satisfaction rate.

InfoSend's Key Support Personnel
InfoSend's mission to provide the industry-best support requires excellence and attention to detail within the Client Services (CS) department. InfoSend has designed support around extensive procedural controls to ensure client output is handled accurately and issues are addressed expeditiously. If InfoSend is awarded this contract, we will at that point assign a dedicated Account Manager to work on the implementation project. This Account Manager will remain the main point of contact throughout the implementation and will also be available after golive for ongoing maintenance or improvement projects.

ATTACHMENT 1 ATTACHMENT A 120
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 15 Executive Management and Sales:

InfoSend designated Contract Administrator: Russ Rezai, President InfoSend designated Contract Manager: Matt Schmidt, COO InfoSend sales contact: Kelly Law, Territory Sales Manager and Glen Everroad, Government Solutions Delivery Team:
• Executive Management and Sales Team: will serve as the main contact for RFP questions and contract negotiations.
• Client Services Team: manage ongoing processing, and will be main points of contact during the new client implementation process. Primary and secondary Client Services contacts will be assigned during the contracting phase if InfoSend is selected as the successful vendor. These contacts will report directly to Matt Schmidt, COO and Josue Martinez, Director of Client Services.
• IT team: will provide back-end support on this project. IT works in conjunction with InfoSend Client Services during any improvement projects and actively monitors program functions after go-live. IT personnel report to Vedat Aral, Director of IT.

Designate the Principal in Charge and other key personnel. Include résumés.

Principal in Charge - Designated Account Manager
Name Kacie Koulias
Experience InfoSend, Inc Anaheim, CA (2015)
Account Manager
• Manage new client implementation projects in a variety of verticals • Provide ongoing personal support to clients
• Coordinate between clients and internal departments to ensure compliance with best practices and procedures
InfoSend, Inc Anaheim, CA (2013-2015)
Client Services Support Associate
• Provide front line support for data processing and change requests to clients in a wide range of industries
• Work with clients to identify issues and/or change requests and coordinate with internal and external stakeholders on resolution.
• Manage custom materials orders and changes requests
• Work on one-time mailing projects utilizing internal resources to meet short turnaround schedules.

Education Bachelor of Science—Health Science 2008, California State University, Long Beach– Long Beach, CA
ATTACHMENT 1 ATTACHMENT A 121
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 16 Other Key Personnel
Name Matt Schmidt
Experience InfoSend, Inc. Anaheim, CA (2007 – present)
Chief Operating Officer
• Manages Operations for InfoSend's 4 facilities
• Manages Client Services team responsible for all client implementation and support • Works with management team on new product planning, development and support • Works on strategic planning for operations including new technologies and services InfoSend, Inc. Anaheim, CA
Director, Client Services
• Supervise employees and operations of the Client Services, Quality Control and Direct Communications departments. Provided consultative solutions for prospect and clients. • Develop, monitor and improve client implementation and support procedures. • Coordinate and implement internal cross-functional processes in an environment of continuous improvement.
• Work with executive management to develop and evaluate long-term strategies to achieve organizational goals.

Education MBA - University of California, Irvine
BA - California State University, Chico
Name Vedat Aral
Experience InfoSend, Inc. Anaheim, CA (2004 – present)
Director, I.T.
• Manages research and development
• New product and service development and deployment – including Data Processing Print and Mail, and eBusiness Services
Gourmet Shuttle Huntington Beach, CA (2002 – 2003)
Software Engineer
Denge Bilisim Istanbul, Turkey (1994 – 2001)
Owner, Software Engineer
Halici Bilgi Islem Ankara, Turkey (1991 – 1994)
Software Engineer
Education MFA, Cinema & TV 1997, Marmara University – Istanbul Turkey BS, Computer Science & Engineering 1991, Hacettepe University – Ankara Turkey Proficient in Website/Forms Design using Following Applications/Languages:

Mainframe, IBM S/36-AS/400, K-Series
COBOL, RPG, Visual Basic, Visual FoxPro, Delphi, C#, ASP.NET SABRE, HDLC, X.25, Mercator, EDIHTML, Crystal Reports, Adobe Illustrator ATTACHMENT 1 ATTACHMENT A 122
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 17 Name Ali Ajami
Experience InfoSend, Inc. Anaheim, CA (2011 – present)
Developer, IT
• Developed and update client data processing programs including medical, county, city and property tax.
• Experience in multiple programming languages
• Experience in parsing various data formats
• Assist with system improvements and delivering high volume projects on time Education MS, Computer Information Systems 2015, CalUMS Project Team Organizational Chart
Also provide a description of the experience your firm has had with similar processes.

Get to Know InfoSend Highlights
• Privately held corporation, founded in 1996 and headquartered in Anaheim, CA. • Provider of Customer Engagement solutions to distribute critical communications and receive payments from customers across multiple channels.
• Company culture and business practice prioritizes client satisfaction, leading to industry best client retention and satisfaction rate.
• Utilizes a Software as a Service (SaaS) approach.
• Customer Communications Management (CCM) solutions, with secure and owned Print and Mail manufacturing environments in CA, TX, IL and FL.
• Electronic Billing, Payment and Presentment (EBPP) solutions, with paperless billing, web, IVR, SMS and Bank BillPay payments.
• More than 250 million print and electronic documents distributed annually.

Matt Schmidt
Chief Operating
Officer
Josue Martinez
Director of Client
Services
Kacie Koulas
Account Manager
Vedat Aral
Director of I.T.

Ali Ajami
Developer
ATTACHMENT 1 ATTACHMENT A 123
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 18 • Over 200 employees across multiple states, with high employee retention ensuring clients are handled with knowledge and care.

Integrity is at the core of InfoSend, with a stated goal to retain and provide complete satisfaction for each client.

InfoSend's Experience with Municipal Utilities
The municipal utility market is our strongest market, comprising 412 of our 750 plus print, mail and electronic customers. These clients range in size - some larger and some smaller than Stockton. InfoSend has accepted files from over 50 different billing systems in support of these utilities including some home grown systems. The references provided in this response serve as a good cross section of our utility clients. Both purple and green flags below represent InfoSend clients.

ATTACHMENT 1 ATTACHMENT A 124
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 19 InfoSend clients surrounding City of Stockton:

ATTACHMENT 1 ATTACHMENT A 125
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 20 InfoSend Data Process Flow
InfoSend's Customer Communications Management (CCM) platform is designed to securely and efficiently accept, process and output client data to customers in a reliable and transparent manner. The data flow for InfoSend entails:

1. Client Input-Data Transfer and Acknowledgement

2. Data Processing and Validation

3. Document Composition and Sample Approval

4. Printing

5. Quality Control

6. Mailing and Electronic Distribution

7. Confirmation and Reporting

1. Client Input-Data Transfer and Acknowledgement
• Secure File Upload Options: On a 24/7 basis, data files can be sent to InfoSend via FTP or SFTP or clients can also log in to InfoSend’s secure website and upload files using the HTTPS file upload method. Optionally, and depending on client security requirements, password protected or PGP/GPG encryption can be utilized on the files.

When a file is received, it is automatically time-stamped and logged in InfoSend’s Job Tracking database. • Duplicate File Prevention: All data transfers are checked against an archive of file-level hashes and if a match is found, the system will detect the file as a duplicate. If a duplicate is detected, the processing program is halted and a warning is generated, calling for immediate follow up by InfoSend support personnel. • Multi-File Inputs: InfoSend's system can be configured to create batches based on multiple source files, as well as wait a predetermined amount of time for more client records to be transferred before beginning the batch processing.
• Process Confirmation: Successfully transferred files are identified by client input type, resulting in a confirmation receipt sent.

2. Data Processing and Validation
• File Integrity: Each of InfoSend’s programs is custom made to work with the clients' specific data file format.

Incomplete or erroneous data will result in a program halt, issuing a warning that is escalated to InfoSend support personnel for immediate follow up.
• Data Checks: InfoSend programs are set up to check for individual data fields and halt if criteria are not met--for example if a date field contains a value older than an acceptable threshold. All data check halts issue a warning and escalation to InfoSend support personnel.

3. Document Composition and Sample Approval
• Job Batch Creation: InfoSend's system will take validated input data and begin processing by assigning a unique production Job Code specific to the client input file(s). This Job Code identifies and accompanies the output through InfoSend's processing.
• Document Layout and Business Logic: the input data is rendered by the InfoSend application, resulting in the layout defined during the implementation. Any client defined special business logic conditions are applied at this time.
• USPS & Special Messaging: During processing, the system will also validate customer mailing addresses, optionally apply National Change of Address (NCOA) updates, and perform record suppression based on clientdefined criteria. The system also performs USPS pre-sorting of records, applying the Intelligent Mail Barcode (IMB) and ensuring the records are in the correct order to maximize postal efficiency. Additionally, InfoSend's CCM platform will check the database for any scheduled messages or inserts to be included with the output. • Rendered Output and Sample Review: Once a file has successfully been rendered, clients have the option to review a sample file containing a PDF output of the documents. Sample outputs can contain a percentage of or the complete output and includes a Process Summary report cover page which lists details on the output work to be performed by InfoSend. Clients are provided the option to either reject and resend their data file with corrections or ATTACHMENT 1 ATTACHMENT A 126
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 21 approve the batch. Once files are approved, an email confirmation of the approval is sent, and the output is released to the manufacturing environment for distribution.

4. Printing
• Job Priority: Jobs are printed on an as-received basis, with jobs requiring the shortest turnaround time given priority. InfoSend is committed to meeting the agreed upon mail turnaround times for all clients simultaneously and is staffed and equipped accordingly.
• Operator Controls: Once a sample file batch has been approved for printing, files are sent to the print production queue. InfoSend's unique Central Print program monitors print jobs in the production department, prohibiting a job from being printed more than once, and provides operator controls including timestamps of printing time and other tracking metrics. InfoSend production staff with appropriate permissions are granted access to queued files. • Job Ticket: A job ticket is attached during processing to each production run. A job ticket contains information such as printing specifications, form type, envelope options, and whether an insert should accompany the file. The job ticket is printed in our production department and remains with a job until it is released to the USPS for mailing.

5. Quality Control
• Dedicated Workflow and Staffing: InfoSend's emphasis on quality and customer satisfaction requires a dedicated step and operator role in the process to validate the printed output. This step in the process takes place after printing but before distribution. Each job is thoroughly checked a minimum of 4 times for general alignment, printing, color or mailing address block issues which would result in problematic processing or mailing: before printing, after printing, upon delivery to the QC department and finally upon delivery to the mailing department. • Uniquely Tailored QC Program: InfoSend has an internally developed workflow that provides onscreen prompts to QC personnel, requesting they check for bill specific information (such as customer name, account number, address) on randomly selected pages throughout the batch. These onscreen prompts are customized to the client's data and ensure the integrity of data throughout the batch before releasing for distribution.

6. Mailing and Electronic Distribution
• Mailing Department: once a job has gone through Quality Control, it is released to the printing department for fulfillment. All printed pages are matched to the correct materials per the Job Ticket and inserted into the envelope for mailing. Mail that has been inserted is then delivered to the USPS with the appropriate postal paperwork for the USPS to validate prior to induction. Upon delivery to the USPS, either at the onsite Detached Mail Unit (DMU) or local distribution center, the job batch is scanned as completed by an InfoSend operator. • Electronic, Multi-Channel Distribution: upon completion of the job batch, InfoSend's CCM platform begins the electronic distribution of customer records to the InfoSend archive, hosted eBusiness system, back to the client, or other third party distribution networks.

7. Confirmation and Reporting
• Process Confirmation: once InfoSend has completed the distribution of the client job batch, a confirmation receipt is sent to the client with details on the job batch execution. This receipt serves as the final notification regarding the input data received.
• Reporting: InfoSend's platform also provides robust reporting back to clients on the output services performed.

InfoSend offers detailed address update and suppression reporting, as well as customized, detailed breakdown of the fulfillment.

ATTACHMENT 1 ATTACHMENT A 127
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 22 Data Processing Workflow Diagram:

ATTACHMENT 1 ATTACHMENT A 128
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 23 Data Processing, Print and Mail Reporting Highlights
• File Transmission and Processing: InfoSend provides key reports during file transmission, after data processing, and upon file completion so clients are informed throughout the entire process. • Process and Postage Summary: For clients utilizing the Sample Approval workflow, a Process Summary report is presented with details on the work to be performed, along with an estimate of postage. • Job Tracking Tool: As client batches are processed, InfoSend provides a web tool with real-time and historical information when a file has achieved a stage of production. • Address Update: InfoSend provides a full suite of address updates, including National Change of Address (NCOA) reports.

Data Processing, Print and Mail Reporting
InfoSend's Customer Communications Management (CCM) platform provides clients with the necessary reports to reconcile and receive updates throughout the Data Processing, Print and Mail (DPPM) process. InfoSend standard reporting workflow is provided by default, and is able to provide certain reports in a variety of methods including text files, comma delimited files, HTML formatted reports and in some cases, PDFs.

All reports are available either through the InfoSend website and can also be emailed or transmitted via secure FTP. In addition, clients have the capability of assigning internal contacts that have permissions to access/receive reports.

File Transfer Acknowledgement Report
Upon client upload of a data file for processing, InfoSend will send the File Transfer Acknowledgement Report as certification of receipt of the file. The File Transfer Acknowledgement Report provides information about the file name, byte size, page/record count and file receipt date. This report is posted to InfoSend’s secure web portal for viewing and is also commonly emailed to designated client staff members.

ATTACHMENT 1 ATTACHMENT A 129
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 24 Process Summary Report
The Process Summary Report is a detailed PDF document that summarizes key data points contained within a document run batch. If a client chooses to review sample files prior to printing, the Process Summary Report will be included as a cover page within each set of samples. It is also posted to InfoSend’s “Reports” tab of the web portal in PDF form. The Process Summary Report details important information such as data files that were included within the job, document details such as page count and batch amount if documents are bills, print output information, suppressions, inserts included, and USPS presort counts and estimated postage.

Process Confirmation Report
The Process Confirmation Report is emailed to designated client staff members as well as posted to the reports section of the web portal after documents have been completed for mailing and released to the USPS. This report provides confirmation that InfoSend has released a job’s mail pieces to the USPS for mailing. The Process Confirmation Report can be created in one of three different formats: plain text, XML or HTML.

This report provides the name of the file(s) mailed along with a detailed mail count. For statements, invoices and other financial documents, the total dollar amount is also provided. Additional information can be provided after the “totals” section of the report. For example, addresses that could not be verified for delivery point validation can be listed at the end of this report.

ATTACHMENT 1 ATTACHMENT A 130
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 25 Job Tracking Tool
The Job Tracker provides the current status of jobs as it progresses through InfoSend’s data processing and print production departments. The Job Tracking tool contains details such as job type, number of component files that are contained within the job, file receipt timestamps, sample files that may be downloaded and the status of printing/quality control/mail preparation. Once a file has been completed for mailing and mail pieces have been released to the USPS a timestamp of file completion confirmation will be provided. InfoSend provides a history of the past 100 jobs that were processed through the system.

ATTACHMENT 1 ATTACHMENT A 131
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 26 Address Update Report
Address Updates including NCOALink hits or ACS updates are provided in InfoSend’s reporting section. The ACS/NCOALink report is available in three formats: plain text comma delimited, XML or HTML. Most address update reports are either comma delimited or XML formatted so that InfoSend’s clients can automate the process of loading updates into their customer information system.

InfoSend Implementation Highlights
• Dedicated Account Manager acts as primary contact and project manager, coordinating all internal setup activities with InfoSend programming and operations staff.
• All setup and training performed virtually, using phone, email, and web-based tools for issue tracking and screen sharing.
• All communications, documentation and test files tracked and stored securely within the InfoSend CRM system, allowing other InfoSend personnel to contribute or take ownership of the project. • Key milestones are established at kickoff, then tracked and reported throughout the project with 4 key phases:

Requirements Gathering, Application Build, User Acceptance Testing (UAT), Go-Live. • During Application Build, InfoSend's Data Processing platform is configured to automate client-specific Quality Assurance (QA) during client data processing.
• All web facing applications are internally validated and then provided to client for training and User Acceptance Testing (UAT) prior to go live.
• Parallel Testing is run prior to Go-Live, ensuring all aspects of the application are validated before launch. • Go-Live includes an "all-hands" approach, with all key InfoSend managers required to review the launch day activity and sign off before application go-live is final.

ATTACHMENT 1 ATTACHMENT A 132
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 27

PROPOSAL FEE
Submit the proposal fee under sealed, separate envelope. Do not include with the technical proposal response. Provide detailed basic fee structure and break‐down of any other charges related to your firm’s proposal as specified. Finalist’s fee structure may be subject to negotiation.

InfoSend has submitted its proposal fee in a separate, sealed envelope.

ATTACHMENT 1 ATTACHMENT A 133
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 28

SCOPE OF SERVICES
The successful firm shall have the capability to perform all services required to print and mail approximately 101,000 City utility bills monthly (1.2 million annually), 6,700 delinquent notices monthly (80,400 annually), and 1,400 various accounts receivable invoices monthly (16,807 annually). The firm shall receive an electronic data file from the City’s utility billing customer information system by remote means and process the data to generate printed City utility bills. All printing, folding, inserting and mail processing services shall be performed by the firm. The firm shall provide materials including City approved bill stock and envelopes. The City may elect to furnish printed informational inserts that the successful firm shall store at its location until inserted in the utility bills. It is also desirable for the firm to have the capability to design and print inserts at the City’s option.

InfoSend's Data Processing, Print & Mail Solutions
InfoSend, as a single source provider of Customer Communications Management (CCM), offers a cloud-based Data Processing platform that is paired with multiple secure manufacturing environments for printing and mailing critical documents. InfoSend's Data, Processing, Print and Mail (DPPM) solution allows clients to reach their customers with effective and timely communications across multiple channels.

InfoSend's DPPM solution accepts data streams from any system and includes all the tools necessary to submit, approve and track all details of the manufacturing and distribution process, including all aspects of USPS compliance, updates and tracking. The fully redundant data processing platform handles the hosting and distribution of the critical documents, allowing businesses to focus on innovating for their customers.

InfoSend's Data Processing, Print & Mail Solutions
• Deep experience handling input data streams from a countless variety of systems across many industries. • Customizable document composition with variable and ad hoc messaging options. • Multi-channel distribution of documents: USPS, eBilling, Online Hosted Archive, API, FTP, Bank Networks and more.
• Online job tracking, customer service, sample approval and production service level agreement (SLA) detail. • Print in black, grayscale, black plus one or more spot colors and full variable color. • Industry-leading Quality Control (QC) process, leveraging the latest technologies to ensure error-free manufacturing.
• Full USPS compliance, postage savings and reporting, including return mail solutions. • Dedicated support for production and distribution of marketing, informational inserts, postcard and special mailings. • Partnered solutions: tracked delivery via FedEx, cash payments from retail locations via PayNearMe, Online Banking and more!
Additionally, the successful firm shall be able to:

Pick up mailing inserts from City designated location on business day following notification by City that materials are ready. Business days are Monday through Friday (City is closed Every Other Friday), 52 weeks per year (except holidays as determined by the City).

InfoSend will meet this requirement,
Process multiple mailings on the same day using different formats and specifications, i.e., utility bill, delinquent notices or other mass mailings as required.

InfoSend will meet this requirement. Our dynamic processing system is capable of managing different bill formats during the same print/mail file run.

Provide billing and mailing supplies per City specification. These supplies may include white or colored 8 1/2“ x 11” paper stock, two (2) sided preprinted in color, perforated for tear-off stub, billing forms, #10 window mailing envelopes and #9 return envelopes. Proponent to ensure that envelopes meet ATTACHMENT 1 ATTACHMENT A 134
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 29 postal regulations to qualify for most beneficial postage rates. Different paper types/colors/sizes and formats may be used for different types of mailings (i.e., white perforated paper for delinquency notices or colored pre-printed bill forms).

InfoSend accepts and supports the above specification, with the one modification being that our production environment does not require prepinted form stock. The City of Stockton's bills and notices will be printed using roll-fed inkjet printing technology. InfoSend will print all static and dynamic document elements and add required perforation during the print finishing process. Information on InfoSend's equipment is as follows.

InfoSend Print and Mail Equipment
InfoSend utilizes a mix of plain black, and full-color printing. The documents destined for mailing are inserted on Intelligent Inserters with Mail Piece integrity that ensures all mail pieces are undamaged and accounted for after insertion in preparation for delivery to the USPS.

Printing Equipment:
• Roll-fed full color (CMYK) inkjet printing is the primary production method. • Production sheet-fed full color (CMYK) inkjet printing is also utilized • Sheet-fed full color and monochrome laser printers for small or specialty jobs and reprints. • Full-color capacity is over 130 Million images per month via full color. • InfoSend prints images well under capacity for business continuity, new installs, and spikes in volume.

Inserting Equipment:
• 4 to 6 station insert feeders and can be expanded if necessary. • Supports various folds including “C”, “V”, “Z” and Double “V”, etc. • Capacity to finish over 86 Million pieces per month.
• Mail Piece Integrity and Document Verification systems read OMR and industry standard barcodes such as 3 of 9, 2 of 5 Interleaved, 2D.
• InfoSend finishes mail pieces well under capacity for business continuity, new installs, and spikes in volume.

InfoSend Print and Mail Equipment Full Listing (Updated March 2022) Printers
Type Printer QTY Images per hour (total output if more than 1 machine)
Full Color Canon Océ JetStream 2200 1 128,820
Full Color Canon i300 1 18,000
Full Color Ricoh Pro VC60000 1 128,820
Full Color Ricoh Pro VC40000 1 128,820
Full Color Xerox Rialto 900 MP 2 54,960
Full Color Ricoh Pro C9100 1 6,600
Monochrome Ricoh Pro 8320 1 8,160
Full Color Xerox 1000i Color Press 1 4,800
Full Color Riso GD9630 7 67,200
Full Color Riso GD9150 1 9,000
Monochrome Kodak Digimaster HD150 3 27,000
ATTACHMENT 1 ATTACHMENT A 135
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 30 Inkjet Printing Technology
InfoSend operates roll-fed inkjet presses out of multiple facilities to enable true Disaster Recovery capabilities. Transactional documents can be printed using full-color production inkjet technology. Inserts can be digitally pre-printed as well as offset equivalent quality using the latest high-definition inkjet technology.

Maintenance contracts are in place with qualified vendors for all InfoSend equipment involved in the fulfillment of client documents. InfoSend carefully selects vendors and equipment to guarantee production of documents according to the Service Level Agreement (SLA) between InfoSend and its clients.

Inserters
Inserter Type QTY Insertions Per Hour (total
output if more than 1
machine)
Sensible Technologies/Bell & Howell Intelligent Inserter with Mail Piece Integrity
26 195,000
Pitney Bowes/BlueCrest FPS/Rival Line of Inserters 10 120,000 MB Inserters 3 54,000
Envelope Manufacturing
Equipment Type QTY Envelopes Manufactured Per Hour
W+D Model 202 1 84,000
W+D Model 102 3 48,000
W+D Model 627 1 54,000
Provide equipment, staff and all materials and services necessary to design, revise and print various formatted billing and notice overlays in conjunction with printing bills and notices from data provided by City.

InfoSend meets this requirement as part of our standard new client setup on our DPPM platform. The City of Stockton will have the option to re-design bill and notice templates during the initial implementation, or can work with InfoSend to mirror the current document design setups.

InfoSend's pricing is comprehensive of a complimentary implementation for all document types outlined in the scope of this RFP, as well as ongoing printing and mailing service (equipment, staffing, materials, finishing).

Print laser images (including bar coding) from mutually agreed format. Ability to receive data (including bar coding) electronically in a mutually agreed format. Proponent to provide necessary staff and equipment to receive/accept electronic transmission of data.

InfoSend fully supports this item. All lockbox (or other) required barcoding will be configured and sent to the City for testing prior to go live.

Data transfer options are as follows:

Client Input-Data Transfer and Acknowledgement
• Secure File Upload Options: On a 24/7 basis, data files can be sent to InfoSend via FTP or SFTP or clients can also log in to InfoSend’s secure website and upload files using the HTTPS file upload method. Optionally, and depending on client security requirements, password protected or PGP/GPG encryption can be utilized on the files.

When a file is received, it is automatically time-stamped and logged in InfoSend’s Job Tracking database.

ATTACHMENT 1 ATTACHMENT A 136
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 31 • Duplicate File Prevention: All data transfers are checked against an archive of file-level hashes and if a match is found, the system will detect the file as a duplicate. If a duplicate is detected, the processing program is halted and a warning is generated, calling for immediate follow up by InfoSend support personnel. • Multi-File Inputs: InfoSend's system can be configured to create batches based on multiple source files, as well as wait a predetermined amount of time for more client records to be transferred before beginning the batch processing.
• Process Confirmation: Successfully transferred files are identified by client input type, resulting in a confirmation receipt sent.

Provide services to fold and stuff: Bill, return envelope and various mailing inserts (as needed) and to prepare these items for mailing in accordance with postal regulations to qualify for most beneficial postage rates; (i.e., zip+4, bar coded, presorted, and Code Access Support System (CASS) Certificate compliance.

InfoSend fully supports this requirement.

USPS Compliance and Efficiency
InfoSend's Customer Communications Management (CCM) platform allows InfoSend to distribute client output to multiple channels, including mail via USPS. InfoSend, as a mailing service provider, maintains technology and USPS compliance to ensure clients are getting the best postage rates and features from mailings.

Postage is the most expensive component of mailed document production, a very important cost consideration when selecting a document production partner and not all vendors provide the most cost-saving discounts available. InfoSend utilizes the following methods to ensure clients are mailing with optimal efficiency.

Full Service with Intelligent Mail Barcode (IMb)
In 2009 the USPS introduced the cost-saving Full-Service mailing option using the Full-Service Intelligent Mail barcode. The Full-Service option provides a number of benefits for qualifying mail pieces. One of the most significant is a postage discount of $0.003 on each qualifying mail piece below the normal lowest pre-sort 5-digit postage rate. InfoSend, by default, will implement the Full-Service Intelligent Mail barcode within client documents produced, saving clients many thousands of dollars in postage costs.

Coding Accuracy Support System (CASS)
InfoSend processes each client file through United States Postal Service (USPS) certified and approved software to ensure the Coding Accuracy Support System (CASS) routine is run. The CASS system improves the accuracy of carrier route, 5-digit ZIP, ZIP + 4, performing Delivery Point Validation (DPV) on mail pieces, and digitally presorts the order of mail for USPS efficiency. Utilizing CASS certification allows InfoSend to obtain the maximum presort postage discounts for client mailings.

USPS Move Updates
InfoSend ensures that clients comply with the USPS Move Update requirements. Mailers must use a USPS approved method to keep client customer address database up to date to qualify for presort discounts. Per USPS requirements clients must update the addresses in the database using the information that is reported back by the USPS. Failure to update addresses within the USPS’s deadline will result in the loss of presort postage discounts.

InfoSend offers two move update services that are compliant with the USPS:

1. Address Change Service (ACS): when this option is selected the USPS forwards client mail to the new address and records the action in their database. InfoSend retrieves this information weekly and sends clients an electronic report of the forwards.

2. NCOALink Service: with this option InfoSend uses the NCOALink database to find the new addresses during data processing. The new addresses can be printed on documents before they are mailed, or printed as-is and forwarded to the new address by the USPS.

In either scenario, clients receive electronic reports of the new addresses after each batch is mailed. If a client elects to have the USPS forward the mail, the addresses must be updated within 90 days.

ATTACHMENT 1 ATTACHMENT A 137
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 32 Detached Mailing Unit (DMU)
InfoSend's Anaheim headquarters and Downers Grove facilities are designated as a USPS Detached Mail Unit (DMU). Having DMU status means that outbound first class mail is inspected by USPS employees located at the production facility, removing the need for mail to be inspected after delivery to the USPS. Mail that is presorted at InfoSend's facility is directly entered into the postal distribution system, expediting mail delivery times and increasing the volume of mail InfoSend can induct daily while reducing overhead.

Ongoing USPS Enhancements
As USPS requirements, customer behaviors and client needs evolve, InfoSend will enhance the service offering.

InfoSend's dedicated research and development staff stay ahead of the USPS changes and mandates, maintaining close contact with USPS representatives to ensure compliance. In addition, InfoSend's development staff meets routinely to discuss upcoming USPS enhancements, scheduling development far in advance to ensure a seamless transition for clients. Should any USPS changes, such as rate increases, require client awareness, InfoSend's Client Services department sends email notifications to clients and closely coordinates changes to output to minimize impact.

Deliver prepared mailings to Stockton Post Office or arrange postal permit that does not designate city of origin if city of origin is other that the City of Stockton.

InfoSend will use its own postal permit for all City of Stockton mailings, paying for postage on the City's behalf and invoicing Net 30 payment terms.

InfoSend's postal permit reads as "INFSND" in the top right corner of the envelope, with the mailing origin city not identified. The City of Stockton's jobs will be printed and mailed from our Anaheim, California facility. • Guarantee delivery of bills to Post Office no later than mailing deadline of next postal business day following receipt of data from City. For example: • DAY 1 - City notifies proponent by 5:00 p.m. of material ready for pick-up or transmission for next day. • DAY 2 - Material picked up from City at mutually agreed upon time (not earlier than 11:00 a.m.). Electronic transmission (no earlier than 11:00 a.m.). • DAY 3 - Printed, mail-ready bills, delivered to U.S. Post Office by the mailing deadline for that day.

InfoSend's standard turnaround time is next business day delivery to USPS. During the initial project kickoff, InfoSend's Client Services team will meet with the City's team to discuss file upload and sample approval cutoffs in order to accommodate next business day service.

Regarding the City’s material pickup requirement, InfoSend will arrange a courier to pick up and then ship printed material overnight, if required. Most of InfoSend’s clients choose to utilize our in-house insert production services in lieu of self printing and we hope to discuss this option with the City in further detail. If the City will require insert or other printed material pickup, InfoSend will need to be notified of this with enough time to schedule a courier pickup and overnight delivery so that printed material is received at our facility prior to InfoSend printing the City’s jobs.

Provide detailed monthly billing for services provided by type of job as specified by City, i.e.; one bill for printing and mailing utility bills, another bill for printing and mailing shut-off/delinquency notices for utilities, another bill for printing and mailing
InfoSend can accommodate this request. Our standard invoicing setup is as follows:

InfoSend Invoicing
InfoSend has devised a client-friendly workflow for producing invoices in a reliable, timely and transparent manner. All data for InfoSend's invoicing is driven by the data processing engine, with accurate software and operational controls to ensure counts are reconciled throughout the process.

InfoSend is capable of providing invoices in formats that fit the needs of the client accounts payable for reconciliation. Invoices can be provided via mail and electronically, as well as on a weekly, bi-monthly or monthly schedule.

ATTACHMENT 1 ATTACHMENT A 138
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 33 A standard client invoice will be provided with an invoice number for reference and includes details of each job batch and output performed by InfoSend that resulted in billable items.

For clients that would prefer to work with the invoice data for additional levels of reconciliation, InfoSend also provides a Process Detail Report for all billable items in a CSV format that may be loaded into Excel. This report for the invoice allows clients to group, sum and analyze the itemized billable elements, from documents to postage, as required for their process.

Miscellaneous A/R invoices and statements. Each periodic bill to include detail information for each printing and mailing job performed.

InfoSend can support this as standard. Please see above for our invoicing setup.

ATTACHMENT 1 ATTACHMENT A 139
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 34 Receive and process City’s electronic transmissions.

InfoSend fully supports electronic file transmission per our standard setup. We have outlined our process flow below, including electronic transmission and the print/mail/delivery process following receipt of client input file.

InfoSend Data Process Flow
InfoSend's Customer Communications Management (CCM) platform is designed to securely and efficiently accept, process and output client data to customers in a reliable and transparent manner. The data flow for InfoSend entails:

1. Client Input-Data Transfer and Acknowledgement

2. Data Processing and Validation

3. Document Composition and Sample Approval

4. Printing

5. Quality Control

6. Mailing and Electronic Distribution

7. Confirmation and Reporting

2. Data Processing and Validation
• File Integrity: Each of InfoSend’s programs is custom made to work with the clients' specific data file format.

ATTACHMENT 1 ATTACHMENT A 140
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 35 • Rendered Output and Sample Review: Once a file has successfully been rendered, clients have the option to review a sample file containing a PDF output of the documents. Sample outputs can contain a percentage of or the complete output and includes a Process Summary report cover page which lists details on the output work to be performed by InfoSend. Clients are provided the option to either reject and resend their data file with corrections or approve the batch. Once files are approved, an email confirmation of the approval is sent, and the output is released to the manufacturing environment for distribution.

InfoSend offers detailed address update and suppression reporting, as well as customized, detailed breakdown of the fulfillment.

ATTACHMENT 1 ATTACHMENT A 141
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 36 Data Processing Workflow Diagram:

ATTACHMENT 1 ATTACHMENT A 142
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 37

2.1 Data Protection
Describe the firm’s oversight of protecting customer data regarding personally identifiable information (PII) and the process for responding to a data breach of customer’s data. Oversight should include but not be limited to transmitting, storing, and accessing the information. The Department of Homeland Security (DHS) defines PII as any information that permits the identity of an individual to be directly or indirectly inferred, including any information that is linked or linkable to that individual, regardless of whether the individual is a U.S. citizen, lawful permanent resident, visitor to the U.S., or employee or contractor to the Department. Sensitive PII includes but is not limited to the information pictured here, which includes Social Security Numbers, driver’s license numbers, Alien Registration numbers, financial or medical records, biometrics, or a criminal history. This data requires stricter handling guidelines because of the increased risk to an individual if the data are compromised. https://www.dhs.gov/privacytraining/what-personally-identifiable-information InfoSend Security Procedures
InfoSend's Customer Communications Management (CCM) platform is responsible for processing and distributing consumer communications. As such, physical infrastructure, data and computing environment security and safety are paramount to protecting consumer information on behalf of clients. InfoSend’s systems, security processes, and practices are currently subject to the rules and regulations of multiple laws and/or audit types:
• Payment Card Industry Data Security Standard (PCI DSS) • Health Insurance Portability and Accountability Act (HIPAA) • Statement on Standards for Attestation Engagements (SSAE 18) • Gramm-Leach-Bliley Act (GLBA)
• Fair and Accurate Credit Transactions Act of 2003 (FACTA) InfoSend approaches the risk of data breach via the following methodologies:

1. All Facility Physical Premises Secured: all InfoSend facilities are locked and protected at all times, with access requiring security authorization by InfoSend. InfoSend employees have issued I.D. cards that must be worn at all times. Guests are strictly monitored and chaperoned.

2. Secure Encrypted Data Transfer and Storage Practices: all data files can be PGP encrypted during transfer, and all web traffic utilizes HTTPS, ensuring secure communications both ways. Data is stored with both encryptions at rest and extensive compensating controls.

3. Secure Segmentation and Disposal of Client Data: data is segmented between each InfoSend customer to ensure no commingling or erroneous joining can occur. All programs and workflows are custom-tailored to the client, ensuring program failure and employee notification in the event data is somehow manually entered into a workflow.

4. Secure Disposal of Client Data: All client data, whether digital or printed is disposed of securely with degaussing and shredding required.

5. Firewalls and Web Application Security: InfoSend limits traffic to and from each facility to business essentials, and employs numerous technologies to detect and thwart intrusion attempts. InfoSend regularly undergoes penetration tests with outside vendors.

6. Background Checks and Drug Tests for All New Employees: all InfoSend employee identities are verified and checked for criminal history before acceptance. In addition, employees are administered and must pass a drug test before hiring.

7. Annual Security Policy and Awareness Training for Employees: all InfoSend employees are given training on security procedures and risks at least annually, ensuring awareness and compliance.

8. Formal Suspected Breach Escalation, Review and Notification Process: all employees are trained to report and escalate suspected breaches or breach attempts to their manager immediately. If client ATTACHMENT 1 ATTACHMENT A 143
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 38 data was at risk, and the breach is not ruled out after a second internal review, then the client is notified and InfoSend pledges full cooperation during the further investigation.

Physical Security Details
InfoSend facilities employ physical site security measures such as zoned and controlled access, cameras, alarms and other theft deterrents. In addition, InfoSend ensures that only approved personnel handle client information and materials. Buildings are locked at all times with approved personnel access controlled by key cards. All visitors are required to sign a visitor log, wear a visitor badge and will be escorted while in the building.

Additionally, InfoSend maintains a West Coast Headquarters and a Midwest facility for business continuity, as well as to support the growing needs of our customers. These production facilities are located in Anaheim, CA, Downers Grove, IL, Carrollton, TX and Fort Myers, FL. Each facility operates with mirrored processes and compatible equipment. InfoSend has a tested disaster recovery plan and a secure off-site data center.

Systems Hardening
InfoSend performs the following systems hardening functions:
• System-wide security policies protect data from internal and external threats • New users must change system-generated passwords upon the first login • Real-time HTTP and HTTPS application layer security inspection • Require special characters and minimum length security passwords • Require password changes every 3 months
• Vendor-supplied default or guest accounts are protected or deleted • Start-up passwords must be created in a manner that is not predictable • Anti-virus definitions are updated automatically as they become available to protect client data from viruses, Trojan horses, worms, etc.
• Anti-virus software is installed on each Windows PC, and on the corporate mail server • Process hardening through use of SELinux
• Live log analysis and file integrity scanning
• Install and maintain the most recent service packs
• Monitor security rollout packages, install patches as needed • Remove unnecessary applications
• Remove unnecessary services and default settings
• Monitor security rollout packages, install patches as needed Continuous Improvement
In an effort to continue core operations and provide the excellent support our clients rely on, InfoSend understands the importance of continued improvement of our security practices. Security is at the forefront of this improvement process. Through our extensive research and proactive measures, InfoSend clients can be assured that their data is protected and handled with the highest industry-standard measures of care.

ATTACHMENT 1 ATTACHMENT A 144
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 39

2.2 Company Background, Experience and Capability
Provide a narrative description of ability to satisfactorily perform the required work by reasons of experience in performing work of a similar nature, demonstrated competence in the services to be performed, strength and stability of the firm, staffing capability, and record of meeting expectations on similar contracts. Provide a complete company profile including background history, years of experience, location and description of production facility, description of equipment and technology used to perform the contract and resumes of key personnel that will support the contract.

Please refer to item 4.5 Corporate Structure, Organization for company experience, background history and staffing capability.

InfoSend Facilities Highlights
• InfoSend is located strategically across the nation, ensuring both disaster mitigation and regional access to the USPS.
• Corporate Headquarters, Primary Data Center & Western US Production Facility located in Anaheim, California. • Midwest, Backup Data Center & Northeastern US Production Facility located in Downers Grove, IL, near Chicago. • Texas & Central US Production Facility located in Carrollton, TX, near Dallas. • Florida & Southeastern Production Facility located in Fort Myers, FL, near Tampa. • Massachusetts and Northeastern Production Facility located in Haverhill, MA near Boston.

ATTACHMENT 1 ATTACHMENT A 145
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 40

Provide a detailed work plan to implement utility bill presentment, printing and mailing from contract award to go live. List the steps required and the time required for each step. Specify what resources the City will be required to provide during start-up and over the course of the contract term.

InfoSend has extensive expertise working with Central Square/Sungard HTE input files. We have reviewed the City’s current document layouts and are prepared to replicate those if necessary, but can also offer modernized designs if the City chooses. If the City chooses to keep its current document layouts InfoSend will need to review our print operations requirements regarding barcoding and margins and slight modifications may need to be made. Samples have been provided following the implementation timeline information below.

InfoSend’s pricing provided separately covers utility bill, delinquent, and A/R bill print and mail and also provides the option for bill/document archive and third party presentment via API. InfoSend also supports a robust electronic bill presentment and payment (EBPP) option, but we have not presented that in this response due to the current scope. We are looking forward to further explaining these options with the City. Details on our standard raw data implementation timeline (typical for Central Square) is as follows below. This timeline is our baseline sample and can be compressed for the City if needed.

InfoSend Implementation
InfoSend's client-focused service and industry-leading client retention rate starts with a successful implementation. Since 1996 InfoSend has continually refined the implementation process to ensure clients GoLive occurs expeditiously and without error.

All InfoSend implementations have 4 key phases.

1. Requirements Gathering

2. Application Build

3. User Acceptance Testing (UAT), Samples, Parallel Testing, and Training

4. Go-Live and Follow Up
Requirements Gathering
The project is started with a dedicated Account Manager assigned to the project. The Account Manager acts as the primary point of contact with clients while working with all internal InfoSend programming and operations staff, and will chair a recurring (often weekly) implementation meeting with the client's key staff. InfoSend, as a cloud-based solutions provider, engages clients in implementation and support via phone, email and web-based tools, including web-browser screen sharing. All setup, training and request tracking is provided virtually using industry standard tools. Critical communications sent to or received from clients during the implementation are centrally archived in the InfoSend CRM system, ensuring all aspects are documented and the implementation can continue should the primary resources be out of the office.

The Account Manager establishes key milestones and completes standardized steps in the InfoSend implementation plan. The process includes requirements gathering and analysis of the application to be developed, including a data mapping exercise, resulting in a Statement of Work (SOW) for client approval.

Application Build
Once the SOW is approved, the application undergoes development and configuration. Prior to completion of development, the application is reviewed by a secondary Account Manager or member of the IT management group to ensure that no task was left undone or done incorrectly. Sample output is produced and checked by InfoSend Quality Control, automated Quality Control methods are configured within processing.

Samples, Parallel Testing, and Training
During the last phase of the implementation, output and application web access is provided to clients for User Acceptance Testing (UAT). Once the application build is validated and accepted by the client, the application is ATTACHMENT 1 ATTACHMENT A 146
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 41 put into Parallel Testing mode. During this time clients are encouraged to transfer copies of live data to InfoSend to be automatically processed and output for review, simulating go-live. Clients check the web application and output to ensure that it is satisfactory and any requested revisions will be completed before go-live. Any payment related applications are tested to ensure payment deposits are received and reconciled. Clients are also trained on how to use InfoSend tools and reporting to support the application at this time.

The hour-long, web-based training covers:
• File uploads
• Sample review and approval
• Managing document messages and insert requests
• Accessing archived reports
• Managing User Permissions
• Performing research and support for customer activity • Payment reconciliation (for payment applications)
• Submitting, viewing and closing support requests
Go-Live and Follow Up
Go-Live of the application includes an "all-hands" approach, with all key InfoSend managers required to review the launch day activity and sign off before application output is final. After Go-live, your Account Manager performs a post go-live follow up to ensure client satisfaction.

InfoSend Data Processing, Print and Mail Project Plan
Based on previous experience with Clients of similar size and structure, the following timeline has been provided for project implementation. The implementation timeline begins once the contracting phase has been completed and InfoSend has received test files and mockups from the Client. Receipt of the test files and mockups will allow the Account Manager to begin the technical implementation.

This is only a sample 10 week timeline and assumes the Client will be attending weekly meetings and remaining responsive in providing deliverables necessary to complete the project.

Milestone: Requirements Gathering | Weeks 1-3 Responsibility Kick-Off Meeting: Familiarize each party with the project managers assigned to the implementation
InfoSend & Client
Kick-Off Meeting: Review, confirm and discuss the client specifications and requirements
InfoSend & Client
Kick-Off Meeting: Discuss requested formatting changes to client output InfoSend & Client Kick-Off Meeting: Begin development of mockups incorporating client feedback InfoSend Kick-Off Meeting: Fill out Standardized Client Installation Checklist InfoSend Kick-Off Meeting: Begin to discuss data processing details and data mapping in correlation to mockup
InfoSend & Client
Follow Up: Finalize any open items on the Client Installation Checklist InfoSend Follow Up: Review mock-ups via online meeting to incorporate Client feedback in realtimeInfoSend & Client Follow Up: All Client deliverables received and documented, access to web applications Client ATTACHMENT 1 ATTACHMENT A 147
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 42 Follow Up: Continue gathering data processing details and developing programming logic InfoSend Follow Up: Provide proofs for custom preprinted form and envelope (if applicable) InfoSend Finalize: Approve InfoSend document mockups Client
Finalize: InfoSend will present the Client with a formal Statement of Work (SOW) which captures all requirements for the implementation project and production of outputs.

InfoSend
Finalize: Client reviews SOW and requests changes/clarification on any relevant items. Client Finalize: Client approves the SOW, Requirements Gathering complete Client Milestone: Application Build |Weeks 4-6
Development: InfoSend Account Manager meets internally with the InfoSend programming team to execute application per the SOW
InfoSend
Development: Application Development Begins InfoSend
Development: As needed, InfoSend Project Manager verifies additional requirements with Client
InfoSend & Client
Development: Internal Testing and Review of Applications is completed by Project Manager
InfoSend
Development: Internal Development Checklist reaches 100% InfoSend Go-Live Planning: Finalize Go-Live schedule, with relevant dates based on Client billing cycle schedule and staff availability for training
InfoSend & Client
Go-Live Planning: Production web application access provisioned InfoSend Milestone: User Acceptance Testing (UAT), Training, Go-Live Coordination | Weeks 7-9 UAT: InfoSend provides first set of samples for review InfoSend UAT: Client reviews the output samples and provides feedback to your Account Manager about requested changes
Client
UAT: Client feedback is communicated to InfoSend’s development team for incorporation into the outputs
InfoSend
UAT: Begin payment/lockbox/other ancillary testing (if applicable) InfoSend & Client UAT: Additional rounds of sample review are conducted for the outputs during weekly meetings
InfoSend & Client
UAT: Final round of changes are conducted for the outputs InfoSend UAT Complete: Provide final approval on the outputs Client UAT Complete: Provide confirmation of payment/lockbox/other ancillary testing completed
Client
UAT Complete: Review Statement of Work (SOW) during weekly meeting and confirm all requirements met
InfoSend & Client
Training: Conduct training for Client staff on InfoSend systems and application management
InfoSend & Client
Go-Live Coordination: Begin parallel testing of application, including any automation scripts
InfoSend & Client
ATTACHMENT 1 ATTACHMENT A 148
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 43 Go-Live Coordination: Complete parallel testing of application InfoSend & Client Go-Live Coordination: Internal Go-Live readiness checklist completed by Project Team and Management
InfoSend
Milestone: Go-Live | Week 10
Go-Live: Receive and process first live file for distribution InfoSend Go-Live: Internal "First Live Run" Checklist completed, with review and signatures required from each department manager
InfoSend
Follow Up and Support: continue weekly meetings to cover additional questions or training until client satisfaction
InfoSend & Client
Follow Up and Support: send implementation survey and make management team available to ensure satisfaction
InfoSend
Sample Bills
On the following pages, we have provided sample bills for current clients that have undergone bill re-designs with InfoSend. InfoSend does not have bill design templates, and if a new design is requested by the City, we will work on a custom design supported by the Stockton’s Central Square data export. Options for design services are detailed below, with samples provided on the following pages.

InfoSend Document Design Services Highlights
o Customizable document look and feel for all clients providing "raw data" inputs, hosted and maintained by dedicated InfoSend staff.
o Experience with a wide array of industry-specific document types and requirements, including bar graphs, consumption charts, and specific read information
o Client Services staff trained in the use of graphic design tools to ensure mockups are professional and accurate.
o During design and mockup, InfoSend advises on latest design best practices for consumer readability, response rate and USPS compliance.
o For documents with OCR, barcode or remittance requirements, full compliance with any specification, including lockbox testing with the delivery of production samples prior to Go-Live. o Extensive experience, software and dedicated equipment for facilitation both transactional and promotional documents: full-color Inkjet, high capacity folding and cutting, online tools for managing marketing copy or images.

ATTACHMENT 1 ATTACHMENT A 149
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 44 Raw billing data, Full color sample, Front (with variable data):

JAN MAR MAY JUL SEP NOV
John Doe 999999-99999 1234 First Ave
AMOUNT DUE:
$89.93
SEWER
$11.46

OUTSIDE AGENCY

CHARGES
$34.83
WATER
$43.64
Please Make Checks Payable and Remit to

CURRENT CHARGES

ACCOUNT INFORMATION

DUE IMMEDIATELY

CUCAMONGA VALLEY WATER DISTRICT
PO BOX 51788
LOS ANGELES, CA 90051-6088

JOHN DOE
1234 E STREET
TUCSON, AZ 85730-1647
METER #: 15252360 METER SIZE: 3/4”
DUE BY:

USAGE INFORMATION
2-Month
Service Period:
09/26/2016 to 11/23/2016
2016
20 15
5 2014 Usage (Units)
5 2015 Usage (Units)
29 2014 2015
Current Read Previous Read
Current Usage (Units)
Please fold on perforation before tearing and return bottom portion with your payment.

UTILITY SERVICES STATEMENT
Customer Name Statement Date Due Date
Additional Information on Reverse
ACCOUNT NUMBER: 999999-99999
SERVICE ADDRESS: 1234 First Ave
35 30
25 20
15 10
5 0
Account Number Service Address

CUCAMONGA VALLEY WATER DISTRICT
10440 ASHFORD ST.

P.O BOX 638
RANCHO CUCAMONGA, CA 91729-0638

PAST DUE BALANCE AMOUNT DUE
TIER 1
Days of Service
58 USAGE HISTORY
12/27/2016 AMOUNT PAID
12/06/2016 12/27/2016
$89.93 $89.93
1 Unit = 748 gallons
Breakdown of charges on reverse
ATTACHMENT 1 ATTACHMENT A 150
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 45 Raw billing data, Full color sample, Back (with variable data):

ATTACHMENT 1 ATTACHMENT A 151
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 46 Raw billing data, Full color sample, Front (with variable data):

ATTACHMENT 1 ATTACHMENT A 152
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 47 Raw billing data, Full color sample, Back (with variable data):

ATTACHMENT 1 ATTACHMENT A 153
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 48 Raw billing data, Full color sample, Front (with variable data):

ATTACHMENT 1 ATTACHMENT A 154
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 49 Raw billing data, Full color sample, Back (with variable data):

ATTACHMENT 1 ATTACHMENT A 155
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 50 Example of a utility bill followed by an inline insert
ATTACHMENT 1 ATTACHMENT A 156
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 51

2.4 Pricing
Pricing proposals must be detailed including the per item fee. Proposals should include all pricing for initial deployment and on-going costs. Pricing must include all costs for labor, hardware, software, testing, and any other costs to be charged by the vendor. Proposals should include any anticipated rate increases.

Pricing has been prepared in a separate envelope per RFP instructions.

ATTACHMENT 1 ATTACHMENT A 157
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 52

2.5 Disaster Recovery Plan
Provide contingency plan acceptable to the City for processing bills and notices in the event of an equipment failure, employee strike, localized natural disaster or any other incident which might interrupt the firm’s normal operations. Include information about them locations and capabilities of alternate facilities, the time required for work to resume at the alternate facilities and how to ensure supplies will be available to print and mail the City’s utility bills in the event of the loss of primary facility.

InfoSend Business Continuity: Risk Mitigation and Disaster Recovery Highlights InfoSend approaches the risk of technology failure or operational interruption via the following methodologies:
• Operations run under capacity for Data Center, Equipment and Labor Force potential • Specific COVID-19 pandemic protocols to prevent labor shortages and protect employees • Operational and Procedural Documentation
• Redundant Communication Lines
• Server Virtualization Used
• Multiple Forms of Data Redundancy: RAID, SAN, VPN Data Sync and Off-Site Hard Drive Backup • Automated Alerts and 24/7 Employee Coverage
• Disaster Recovery Plan and Preparedness
InfoSend Business Continuity: Risk Mitigation and Disaster Recovery InfoSend understands the importance of business continuity. InfoSend’s organization and systems are designed to ensure risk mitigation and resilient disaster response in the event of unforeseen events. InfoSend uses its multiple, geographically distinct facilities to ensure regional events do not affect InfoSend operations.

Hundreds of clients depend on our platforms and staff to provide business-critical services. Our excellent client retention track record speaks to our system reliability and high-quality processing. While InfoSend has never had to implement a disaster recovery plan in a live environment, a great importance is placed on maintaining and testing a successful disaster recovery strategy. InfoSend's knowledge of a strong disaster recovery strategy comes from testing, consultation with IT experts, and from years of research.

InfoSend's approaches business continuity through:

A. Risk Mitigation
B. Disaster Recovery Plan
A. Risk Mitigation
InfoSend has designed the organization and systems to mitigate various risks that could impact or completely disable national or regional operations. By building resiliency at the local level, InfoSend ensures highly available and secure operations at each facility and system-wide. Risk is mitigated through:
• Organizational Design
• Data Center Design
• Data Backup Design
• Network Security
• Labor Management
• Client Material Redundancy
• Equipment Mirroring
• Facility Mirroring
Organizational Design
ATTACHMENT 1 ATTACHMENT A 158
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 53

1. Operations Run Under Capacity: this ensures that each local facility can endure well above normal interruptions in labor force or fulfillment equipment availability. Employees in critical roles are crosstrained to provide coverage of any specialized work.

2. Operational and Procedural Documentation: all systems and practices are documented both for internal training and reference, as well as to meet outside audit requirements in order to maintain compliances such as PCI-DSS Level 1 and HIPAA.

3. Redundant Communication Lines: InfoSend’s headquarters utilize both wired and wireless lines, with seamless failover should an Internet provider have an outage.

4. Server Virtualization Used: InfoSend fully leverages server virtualization technology, ensuring any critical processes can be hardware agnostic and quickly cut over to other available hardware resources in the event of a failure.

5. Multiple Forms of Data Redundancy: RAID, SAN, VPN Data Sync and Off-Site Hard Drive Backup.

InfoSend utilizes a combination of these methods to ensure real-time accuracy, redundancy and disasterproof availability of data.

6. Automated System Alerts and 24/7 Employee Coverage: InfoSend ensures that all systems are automatically monitored and reported on, with failures triggering emails and text messages to employee phones. Multiple employees are cross-trained in systems engineering and administration for around the clock coverage across all facilities.

7. Disaster Recovery Plan and Preparedness: in the event of severe labor interruptions or physical premises becoming incapable of production due to external causes, InfoSend will utilize its Disaster Recovery site to continue operations.

Data Center Design
• Redundant data centers; system architecture uses industry-standard security practices and a multi-layered security approach.
• Redundancy for all critical servers, switches, etc. Virtualization used to provide automatic backup and restoration of live operating systems.
• Highly scalable; system scales horizontally so that additional processing power can be added quickly. Load balancing for high availability.
• Multiple methods of secure data transmission with firewall failover are available to ensure that client data reaches InfoSend securely, quickly, and in whole.
• Each InfoSend facility has high speed Internet connections with a minimum of 10mb of bandwidth. Both the primary data center facility (corporate H.Q.) and DR data center use a fiber optic Internet connection from AT&T with a minimum of 100mb of bandwidth. The primary data center also has a backup wireless Internet connection from a different provider.
• UPS systems for battery backup and 600KW backup generator to power data center automatically in the event of grid failure.
• Large secure storage array; all network storage uses RAID and SAN technology. • Backup copies of all data files are made before processing; data is backed up to external hard drives, stored in a fireproof safe, and picked up by an enterprise media vaulting service provider • System and facility capacity and responsiveness are constantly monitored with Icinga protocol; alerts sent to internal systems administration staff when potential issues arise. • The system is scaled to prepare for upcoming volume increases. • InfoSend's security and compliance procedures ensure infrastructure is constantly improved and evolved.

Data Backup Design
InfoSend utilizes a secure VPN to ensure the primary data center is continually syncing data to the disaster recovery site. Server virtualization technology is also leveraged to ensure applications are hardware agnostic and can be configured and run at any of the InfoSend sites with little to no cutover time. All data is committed to encrypted media backup and routinely taken offsite to a secure location.

ATTACHMENT 1 ATTACHMENT A 159
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 54 Four separate backup methods are in place to protect data and assure systems are fully restored after a disaster of any type:

1. All servers are duplicated at the Disaster Recovery Facility. Data is automatically synced between the main facility and the Disaster Recovery Facility over a secure VPN.

2. Server data is backed up to secure encrypted media that are both stored in fireproof safes and taken offsite routinely.

3. The RAID system is used on all servers to ensure that data remains available in the event of a hard disk failure.

4. Network SAN systems are used that expand upon RAID by duplicating the entire network storage system to a redundant node with its own RAID.

Network Security
• HTTPS encryption on all web server connections, server authentication. • Client authentication for TCP/IP connections.
• Firewalls blocking all traffic unless expressly permitted, no direct connections to the LAN. • Only authenticated users of InfoSend’s intranet can access the LAN locally or remotely (via the VPN), two-factor authentication required for VPN access.
• System attack attempts are monitored and directly reported to system administrators. • Limited access points due to tiered permission levels for InfoSend's CRM system, client data access points, storage drives, and networks. Each access point is guarded by separate firewalls. • Separation of firewalls and networks in order to isolate production network. Enterprise-class firewalls are used to safeguard data, using a combination of the layer-3, layer-4, and layer-7 security technologies. • Perimeter network security data/protection. HTTP, FTP, and SFTP networks located within networks behind secured servers.
• HTTP, FTP, and SFTP set application protocols and application filtering. • Continuous monitoring of web applications by InfoSend’s system administrators, with automated notifications, enable in the case of threat detection or web vulnerability. • Static and dynamic packet filtering.
• Scheduled testing of InfoSend’s systems.
• Meets rigorous audit requirements.
• Notifications from McAfee, CERN, etc.
• Data transmission through HTTPS web uploads or FTP/SFTP with PGP encryption • VPN system hardening.
• External third-party security monitoring alerts InfoSend if there is a potential security risk.

Labor Management
InfoSend’s employees are cross-trained and can manage tasks that span the entire production process.

InfoSend employs more production staff than is required to handle spikes in volume and/or employees being unavailable for any reason. At InfoSend’s current size and capacity, operations can run normally with the absence of key personnel with no effect on production.

For COVID-19, InfoSend has deployed the following strategies:
• Masks are required in all common areas.
• All production staff use equipment at least 6 feet apart, following social distancing protocols. • Workers who can work remotely are setup with secure remote access, and will remain at home as long as required during government-issued stay at home orders.

ATTACHMENT 1 ATTACHMENT A 160
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 55 • Facility mirroring at InfoSend's 4 nationwide locations allows InfoSend to load balance client production across facilities should a localized shut-down result in sudden impacts.

Client Materials Redundancy
• InfoSend’s standard envelopes are stored at each facility. • InfoSend manufactures its own envelopes as well as purchases from suppliers to ensure ample inventory. • InfoSend’s standard forms (including the blank white form with a perforation) are stored at each facility. • All paper materials required for mail piece production are sourced from American paper mills to avoid global supply chain disruption.
• The custom pre-printed form elements (e.g. logo, statement backer) can also be printed on white paper if a client's custom forms are not available.

Equipment Mirroring
• Intelligent mail inserters (with mail piece integrity) are actively in use at all facilities. • Each facility uses multiple printing and inserting production lines, each that operate independently of the others in the case of equipment maintenance or downtime.
• InfoSend’s Job Tracking application logs where each batch is produced and can redirect individual jobs to other facilities on the fly if needed.

Facility Mirroring
• InfoSend owns and operates facilities in 4 different states: California, Texas, Illinois and Florida. By not relying on third party contracts for DR capacity InfoSend has true Disaster Recovery. • Large clients can opt to have their jobs split from two facilities on a normal day to day basis. This ensures that DR capabilities are continually tested.
• All facilities utilize inkjet printing onto white paper and stock standard envelopes (see above sections). • For COVID-19, Facility Mirroring has provided continuity when the following occurs:
o Some production team members were not able to report to work due to their children being sent home from school.
o Additionally team members have been required to stay home for an extended time period after catching a cold or fever or having potential exposure to Covid-19. o These temporary labor outages did not impact our clients as InfoSend was able to redirect jobs from facilities that were temporarily understaffed to other facilities that had excess capacity.

B. Disaster Recovery
Should one of InfoSend’s facilities operations become partially or fully disabled, then the InfoSend Disaster Recovery (DR) Plan is enacted. The DR Plan requires the following steps be followed:

1. Detection: the InfoSend Emergency Management Team (EMT) is notified and assembled to evaluate the degraded operations.

2. Assessment: an Assessment Checklist is completed to assess and assign a DR Response Level.

3. Response/ Facility Failover Checklist: upon completion of the assessment, InfoSend immediately begins the DR Response Checklist according to the Disaster Level.

4. Notification: notifications are provided both internally to staff and externally to clients according to the Response Level, including details on service impacts and timelines for resolution.

5. Recovery: InfoSend ensures the completion of the DR Checklist and measures to ensure normal operations have resumed.

6. Facility Restoration: repairs begin immediately upon resumption of normal operations, and eventual service restoration to the regional facility is planned.

ATTACHMENT 1 ATTACHMENT A 161
InfoSend, Inc. | www.infosend.com City of Stockton RFP for Utility Bill Print & Mail | 56 DR Response Levels
InfoSend maintains 3 levels of disaster response.

Level 1: no critical damage to the facility to prevent operations, same day recovery expected.

Level 2: some damage to the facility, full failover not required. Some operations re-routed, full operations expected within 5 days.

Level 3: facility is inoperable, full failover enacted.

If the primary facility should become disabled, then data processing and system hosting will be moved to the disaster recovery facility. If facility fail-over is enacted, available labor resources will travel to the other facilities to help with the disaster recovery efforts. Should there ever be a case where one of InfoSend’s facilities is impacted by a major disaster, the company has a travel and lodging contingency plan for necessary employees to travel to a facility providing disaster recovery support.

If facility fail-over is enacted, then restoration of the affected facility will begin as soon as possible.

Testing and Documentation
InfoSend’s disaster recovery procedures are continuously improved. Documentation is regularly updated as necessitated by new requirements or changes to internal procedure or systems engineering.

InfoSend tests the DR Plan annually with executive management review and approval.

ATTACHMENT 1 ATTACHMENT A 162

EXHIBIT B

INSURANCE
Contractor shall procure and maintain for the duration of the contract insurance against claims for injuries to persons or damages to property which may arise from or in connection with the performance of the work hereunder and the results of that work by the Contractor, his agents, representatives, employees or subcontractors.

MINIMUM SCOPE AND LIMIT OF INSURANCE
Coverage shall be at least as broad as:

1. Commercial General Liability (CGL): Insurance Services Office Form CG 00 01 covering CGL on an “occurrence” basis, including products and completed operations, property damage, bodily injury and personal & advertising injury with limits no less than $2,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location (ISO CG 25 03 or 25 04) or the general aggregate limit shall be twice the required occurrence limit.

2. Automobile Liability: ISO Form Number CA 00 01 covering any auto (Code 1), or if Contractor has no owned autos, hired, (Code 8) and non-owned autos (Code 9), with limit no less than $1,000,000 per accident for bodily injury and property damage.

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

If the Contractor maintains broader coverage and/or higher limits than the minimums shown above, the City of Stockton requires and shall be entitled to the broader coverage and/or the higher limits maintained by the contractor. Any available insurance proceeds in excess of the specified minimum limits of insurance and coverage shall be available to the City of Stockton.

Other Insurance Provisions
The insurance policies are to contain, or be endorsed to contain, the following provisions:

Additional Insured Status
The City of Stockton, its officers, officials, employees, and volunteers are to be covered as additional insureds on the CGL policy with respect to liability arising out of work or operations performed by or on behalf of the Contractor including materials, parts, or equipment furnished in connection with such work or operations. General liability coverage can be provided in the form of an endorsement to the Contractor’s insurance ATTACHMENT A 163
(at least as broad as ISO Form CG 20 10 11 85 or if not available, through the addition of both CG 20 10, CG 20 26, CG 20 33, or CG 20 38; and CG 20 37 if a later edition is used). Additional insured Name of Organization shall read “City of Stockton, its officers, officials, employees, and volunteers.” Policy shall cover City of Stockton, its officers, officials, employees, and volunteers for all locations work is done under this contract.

Primary Coverage
For any claims related to this contract, the Contractor’s insurance coverage shall be primary and non-contributory and at least as broad as ISO CG 20 01 04 13 as respects the City of Stockton, its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the City of Stockton, its officers, officials, employees, or volunteers shall be excess of the Contractor’s insurance and shall not contribute with it. This requirement shall also apply to any Excess or Umbrella liability policies. The City of Stockton does not accept endorsements limiting the Contractor’s insurance coverage to the sole negligence of the Named Insured.

Umbrella or Excess Policy
The Contractor may use Umbrella or Excess Policies to provide the liability limits as required in this agreement. This form of insurance will be acceptable provided that all of the Primary and Umbrella or Excess Policies shall provide all of the insurance coverages herein required, including, but not limited to, primary and non-contributory, additional insured, Self-Insured Retentions (SIRs), indemnity, and defense requirements. The Umbrella or Excess policies shall be provided on a true “following form” or broader coverage basis, with coverage at least as broad as provided on the underlying Commercial General Liability insurance. No insurance policies maintained by the Additional Insureds, whether primary or excess, and which also apply to a loss covered hereunder, shall be called upon to contribute to a loss until the Contractor’s primary and excess liability policies are exhausted.

Notice of Cancellation
Each insurance policy required above shall provide that coverage shall not be canceled, except with notice to the City of Stockton.

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

Self-Insured Retentions
ATTACHMENT A 164
Self-insured retentions must be declared to and approved by the City of Stockton. The City of Stockton may require the Contractor to purchase coverage with a lower retention or provide proof of ability to pay losses and related investigations, claim administration, and defense expenses within the retention. The policy language shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the named insured or City of Stockton. The CGL and any policies, including Excess liability policies, may not be subject to a self-insured retention (SIR) or deductible that exceeds $25,000 unless approved in writing by City of Stockton. Any and all deductibles and SIRs shall be the sole responsibility of Contractor or subcontractor who procured such insurance and shall not apply to the Indemnified Additional Insured Parties. City of Stockton may deduct from any amounts otherwise due Contractor to fund the SIR/deductible. Policies shall NOT contain any self-insured retention (SIR) provision that limits the satisfaction of the SIR to the Named. The policy must also provide that Defense costs, including the Allocated Loss Adjustment Expenses, will satisfy the SIR or deductible. City of Stockton reserves the right to obtain a copy of any policies and endorsements for verification.

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

Verification of Coverage
Contractor shall furnish the City of Stockton with original certificates and amendatory endorsements or copies of the applicable policy language effecting coverage required by this clause and a copy of the Declarations and Endorsements Pages of the CGL and any Excess policies listing all policy endorsements. All certificates and endorsements and copies of the Declarations & Endorsements pages are to be received and approved by the City of Stockton before work commences. However, failure to obtain the required documents prior to the work beginning shall not waive the Contractor’s obligation to provide them. The City of Stockton reserves the right to require complete, certified copies of all required insurance policies, including endorsements required by these specifications, at any time. City of Stockton reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.

Special Risks or Circumstances
City of Stockton reserves the right to modify these requirements, including limits, based on the nature of the risk, prior experience, insurer, coverage, or other special circumstances.

Certificate Holder Address
ATTACHMENT A 165
The address for mailing certificates, endorsements and notices shall be:

City of Stockton
Its Officers, Officials, Employees, and Volunteers
400 E Main St, 3rd Floor – HR
Stockton, CA 95202
ATTACHMENT A 166

EXHIBIT C

GENERAL TERMS AND CONDITIONS

1. Goods, Equipment and Services. Subject to the terms and conditions set forth in this Agreement, Contractor shall provide to City the services described in Exhibit A of the Agreement. Contractor shall provide said services at the time, place and in the manner specified in Exhibit A of the Agreement.

2. City Assistance, Facilities, Equipment and Clerical Support. Except as set forth in Exhibit A, Contractor shall, at its sole cost and expense, furnish and maintain all facilities and equipment that may be required for furnishing services pursuant to this Agreement. If applicable, City shall furnish to Contractor only the facilities and equipment listed in Exhibit A to the Agreement.

3. Compensation. City shall pay Contractor for services rendered pursuant to this Agreement as described more particularly in Exhibit A and Exhibit E to the Agreement.

3.1 Invoices submitted by Contractor to City must contain a brief description of work performed, time spent and City reference number. Within thirty (30) days of receipt of Contractor’s invoice, City will review invoice, and if acceptable make payment on approved invoice.

3.2 Upon completion of work and acceptance by City, Contractor shall have sixty (60) days in which to submit final invoicing for payment. An extension may be granted by City upon receiving a written request thirty (30) days in advance of said time limitation. The City shall have no obligation or liability to pay any invoice for work performed which the Contractor fails or neglects to submit within sixty (60) days, or any extension thereof granted by the City, after the work is accepted by the City.

3.3 InfoSend may elect to assess finance charges on any or all undisputed invoices that become past due by more than 30 days at a rate of 1.5% per month.

4. Sufficiency of Contractor’s Work. All Contractor services, work, and deliverables shall be performed in a good and workmanlike manner with due diligence in accordance with the degree of skill normally exercised by similar contractors supplying services and work of a similar nature, and in conformance with applicable laws, codes and professional standards. Contractor’s work shall be adequate and sufficient to meet the purposes of this Agreement.

5. Ownership of Work. All reports, work product, all other documents completed or partially completed by Contractor or its approved subcontractors, in performance of this Agreement, and if applicable, drawings, designs, and plan review comments shall become the property of the City. Any and all copyrightable subject matter in all materials ATTACHMENT A 167
is hereby assigned to the City and the Contractor and its approved subcontractors agree to execute any additional documents that may be necessary to evidence such assignment. All materials shall be delivered to the City upon completion or termination of the work under this Agreement. If any materials are lost, damaged or destroyed before final delivery to the City, the Contractor shall replace them at its own expense. Contractor and its approved subcontractors shall keep materials confidential. Materials shall not be used for purposes other than performance of services under this Agreement and shall not be disclosed to anyone not connected with these services, unless the City provides prior written consent.

6. Timeliness. Time is of the essence in this Agreement. Further, Contractor acknowledges that the failure of Contractor to comply with the time limits described in Exhibit A and Exhibit F may result in economic or other losses to the City.

7. Changes. Both parties to this Agreement understand that it may become desirable or necessary during the term of this Agreement for City to modify the scope of services provided for under this Agreement. Any material extension or change in the scope of work shall be discussed with City and the change and cost shall be memorialized in a written amendment to the original contract prior to the performance of the additional work. Until the amendment is so executed, City will not be responsible to pay any charges Contractor may incur in performing such additional services, and Contractor shall not be required to perform any such additional services.

8. Amendment. No variation of the terms of this Agreement shall be valid unless an amendment is made in writing and signed by both parties.

9. Contractor’s Status.

9.1 In performing the obligations set forth in this Agreement, Contractor shall have the status of an independent contractor and Contractor shall not be considered to be an employee of the City for any purpose. All persons working for or under the direction of Contractor are its agents and employees and are not agents or employees of City. Contractor by virtue of this Agreement, has no authority to bind or incur any obligation on behalf of City. Except as expressly provided in Exhibit A, Contractor has no authority or responsibility to exercise any rights or power vested in the City. No agent, officer or employee of the City is to be considered an employee of the Contractor. It is understood by both Contractor and City that this Agreement shall not be construed or considered under any circumstances to create an employer-employee relationship or a joint venture.

9.2 Contractor shall determine the method, details and means of performing the work and services to be provided by Contractor under this Agreement.

Contractor shall be responsible to City only for the requirements and results specified in this Agreement and, except as expressly provided in this Agreement, shall not be subjected to City's control with respect to the physical action or activities of Contractor in fulfillment of this Agreement.

Contractor has control over the manner and means of performing the ATTACHMENT A 168
services under this Agreement. If necessary, Contractor has the responsibility for employing other persons or firms to assist Contractor in fulfilling the terms and obligations under this Agreement.

9.3 If in the performance of this Agreement any third persons are employed by Contractor, such persons shall be entirely and exclusively under the direction, supervision and control of Contractor. All terms of employment including hours, wages, working conditions, discipline, hiring and discharging or any other term of employment or requirements of law shall be determined by the Contractor.

9.4 It is further understood and agreed that Contractor must issue W-2 forms or other forms as required by law for income and employment tax purposes for all of Contractor's assigned personnel under the terms and conditions of this Agreement.

10. Subcontractor.

10.1 Subcontractors shall not be recognized as having any direct or contractual relationship with City. Contractor shall be responsible for the work of subcontractors, which shall be subject to the provisions of this Agreement.

Subcontractors will be provided with a copy of the Agreement and be bound by its terms. Contractor is responsible to City for the acts and omissions of its subcontractors and persons directly or indirectly employed by them.

10.2 If in the performance of this Agreement any third persons are employed by Contractor, such persons shall be entirely and exclusively under the direction, supervision and control of Contractor. All terms of employment including hours, wages working conditions, discipline, hiring, and discharging or any other term of employment or requirement of law shall be determined by Contractor.

10.3 It is further understood and agreed that Contractor must issue W-2 forms or other forms as required by law for income and employment tax purposes for all of Contractor’s personnel.

11. Termination.

11.1 Termination for Convenience of City. The City may terminate this Agreement at any time by mailing a notice in writing to Contractor. The Agreement shall then be deemed terminated, and no further work shall be performed by Contractor. If the Agreement is so terminated, the Contractor shall be paid for the work actually completed at the time the notice of termination is received.

11. 2 Should either party default in the performance of this Agreement or materially breach any of its provisions, the other party, at that party’s option, may terminate this Agreement by giving written notification to the other ATTACHMENT A 169
party.

11.3 Funding- Non-Appropriation. It is mutually understood between the Parties that payment to the Contractor for performance shall be dependent upon the availability of appropriations by the City Council for the purposes of this Agreement. No legal liability on the part of the City for any payment may arise under this Agreement until funds are made available and until the Contractor has received funding availability, which will be confirmed in writing. If funding for any fiscal year is reduced or deleted, or if the City loses funding for any reason, the City, in its sole discretion, shall have the option to either (a) cause this Agreement to be canceled or terminated pursuant to applicable provisions of the Agreement; or (b) offer to amend the Agreement to reflect the reduced funding for this Agreement.

12. Non-Assignability. The Contractor shall not assign, sublet, or transfer this Agreement or any interest or obligation in the Agreement without the prior written consent of the City, and then only upon such terms and conditions as City may set forth in writing.

Contractor shall be solely responsible for reimbursing subcontractors.

13. Indemnity and Hold Harmless. To the fullest extent permitted by law, Contractor shall hold harmless, defend and indemnify City of Stockton and its officers, officials, employees and volunteers from and against any and all liability, loss, damage, expense, costs (including without limitation costs and fees of litigation) of every nature arising out of or in connection with Contractor’s performance of work hereunder or its failure to comply with any of its obligations contained in the Agreement, except such loss or damage which was caused by the sole negligence or willful misconduct of the City of Stockton. This obligation is independent of, and shall not in any way be limited by, the minimum Insurance obligations contained in this Agreement. These obligations shall survive the completion or termination of this Agreement.

14. Insurance. During the term of this Agreement, Contractor shall maintain in full force and effect at its own cost and expense the insurance coverage as set forth in the attached Exhibit B to this Agreement and shall otherwise comply with the other provisions of Exhibit B to this Agreement.

15. Notices. All notices herein required shall be in writing and shall be sent by certified or registered mail, postage prepaid, addressed in Exhibit A to this Agreement.

16. Conformance to Applicable Laws. Contractor shall comply with all applicable Federal, State, and Municipal laws, rules, and ordinances. Contractor shall not discriminate in the employment of persons or in the provision of services under this Agreement on the basis of any legally protected classification, including race, color, national origin, ancestry, sex or religion of such person.

17. Licenses, Certifications and Permits. Prior to the City’s execution of this Agreement and prior to the Contractor’s engaging in any operation or activity set forth in this Agreement, Contractor shall obtain a City of Stockton business license, which must be kept in effect during the term of this Agreement. Contractor covenants that it has obtained all certificates, licenses, permits and the like required to perform the services ATTACHMENT A 170
under this Agreement. Such licenses, certificates and permits shall be maintained in full force and effect during the term of this Agreement.

18. Records and Audits. Contractor shall maintain all records regarding this Agreement and the services performed for a period of three (3) years from the date that final payment is made. At any time during normal business hours, the records shall be made available to the City to inspect and audit. To the extent Contractor renders services on a time and materials basis, Contractor shall maintain complete and accurate accounting records, in a form prescribed by City or, if not prescribed by City, in accordance with generally accepted accounting principles, such records to include, but not be limited to, payroll records, attendance cards, time sheets, and job summaries.

19. Confidentiality. Contractor shall exercise reasonable precautions to prevent the unauthorized disclosure and use of City reports, information or conclusions.

20. Conflicts of Interest. Contractor covenants that other than this Agreement, Contractor has no financial interest with any official, employee or other representative of the City. Contractor and its principals do not have any financial interest in real property, sources of income or investment that would be affected in any manner of degree by the performance of Contractor’s services under this Agreement. If such an interest arises, Contractor shall immediately notify the City.

21. Waiver. In the event either City or Contractor at any time waive any breach of this Agreement by the other, such waiver shall not constitute a waiver of any other or succeeding breach of this Agreement, whether of the same or of any other covenant, condition or obligation. No payment, partial payment, acceptance, or partial acceptance by City shall operate as a waiver on the part of City of any of its rights under this Agreement.

22. Governing Law. California law shall govern any legal action pursuant to this Agreement with venue for all claims in the Superior Court of the County of San Joaquin, Stockton Branch or, where applicable, in the Federal District Court of California, Eastern District, Sacramento Division.

23. No Personal Liability. No official or employee of City shall be personally liable to Contractor in the event of any default or breach by the City or for any amount due Contractor.

24. Severability. If any portion of this Agreement or application thereof to any person or circumstance shall be declared invalid by a court of competent jurisdiction or if it is found in contravention of any federal, state or city statue, ordinance or regulation the remaining provisions of this Agreement or the application thereof shall not be invalidated thereby and shall remain in full force and effect to the extent that the provisions of this Agreement are severable.

25. Non-Discrimination. During the performance of this Agreement, Contractor and its officers, employees, agents, representatives or subcontractors shall not unlawfully discriminate in violation of any federal, state, or local law, rule or regulation against any ATTACHMENT A 171
employee, applicant for employment or person receiving services under this Agreement because of race, religion, color, national origin, ancestry, physical or mental disability, medical condition (including genetic characteristics), marital status, age, political affiliation, gender identity, gender expression, sex or sexual orientation, family and medical care leave, pregnancy leave, or disability leave. Contractor and its officers, employees, agents, representative or subcontractors shall comply with all applicable Federal, State and local laws and regulations related to non-discrimination and equal opportunity, including without limitation the City’s nondiscrimination policy; the Fair Employment and Housing Act (Government Code sections 12990 (et seq.); California Labor Code sections 1101, 1102 and 1102.1; the Federal Civil Rights Act of 1964 (P.L. 88-352), as amended; and all applicable regulations promulgated in the California Code of Regulation or Code of Federal Regulations. Title VI of the Civil Rights Act of 1964 requires that “no person in the United States shall, on the grounds of race, color, or national origin be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving federal financial assistance.” (42 USC Section 2000d).
http://www.dol.gov/oasam/regs/statutes/titlevi.htm. The City requires compliance with the requirements of Title VI in all of its programs and activities regardless of funding source.

26. Force Majeure. Neither party shall be responsible for delays or failures in performance resulting from acts of God, acts of civil or military authority, terrorism, fire, flood, strikes, war, epidemics, pandemics, shortage of power, fuel or raw materials, or other acts or causes reasonably beyond the control of that party. The party experiencing the force majeure event agrees to give the other party notice promptly following the occurrence of a force majeure event, and to use diligent efforts to re-commence performance as promptly as commercially practicable

27. Taxes and Charges. Contractor shall be responsible for payment of all taxes, fees, contributions or charges applicable to the conduct of the Contractor’s business.

28. Cumulative Rights. Any specific right or remedy provided in this Agreement will not be exclusive but will be cumulative of all other rights and remedies to which may be legally entitled.

29. Advice of Attorney. Each party warrants and represents that in executing this Agreement, it has received independent legal advice from its attorneys or the opportunity to seek such advice.

30. Heading Not Controlling. Headings used in this Agreement are for reference purposes only and shall not be considered in construing this Agreement.

31. Entire Agreement, Integration, and Modification.

31.1 This Agreement represents the entire integrated agreement between Contractor and the City; supersedes all prior negotiations, representations, or agreements, either written or oral between the parties and may be amended only by a written Amendment signed by the Contractor and City Manager.

ATTACHMENT A 172

31.2 All Exhibits to this Agreement and this Agreement are intended to be construed as a single document.

32. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original. All counterparts shall be construed together and shall constitute one agreement.

33. Authority. The individual(s) executing this Agreement represent and warrant that they have the legal capacity and authority to do so on behalf of their respective legal entities.

ATTACHMENT A 173

EXHIBIT D

PROFESSIONAL SERVICES SPECIAL TERMS AND CONDITIONS

1. Definitions. The following words and phrases have the following meanings for purposes of this Agreement:

1.1 "Services" means, collectively, the services, duties and responsibilities described in Exhibit A of this Agreement and any and all work necessary to complete them or carry them out fully and to the standard of performance required in this Agreement.

1.2 “Deliverable” means quantifiable goods or services that will be provided upon completion of a project. A deliverable is any tangible material, work or thing delivered by one party to the other, including associated technical documentation. A deliverable can be tangible or intangible parts of the development process, and often are specified functions or characteristics of the project.

2. General. The following terms and conditions are applicable for the Professional Services only. The special conditions shall be read in conjunction with the Standard Agreement, General Terms and Conditions (“GTC”) Exhibit C, and all other Exhibits identified in the Standard Agreement.

2.1 Where any portion of the GTC is in conflict to or at variance with any provisions of the Special Conditions of the Agreement, then unless a different intention stated, the provision(s) of the Special Conditions of the Agreement shall be deemed to override the provision(s) of GTC only to the extent that such conflict or variations in the Special Conditions of the Agreement are not possible of being reconciled with the provisions of the GTC.

2.2 In the case of modification of a part or provision of the GTC, the unaltered part or provision, or both shall remain in effect. The Special Conditions shall relate to a particular project and be peculiar to that project but shall not weaken the character or intent of the GTC.

3. Time for Performance.

3.1 Contractor shall perform the services according to the schedule contained in Exhibit F.

3.2 Timeliness of Performance i) Contractor shall provide the Services, and Deliverables within the term and within the time limits required under this Agreement, pursuant to the provisions of Exhibit A and Exhibit F. ii) Neither Contractor nor Contractor’s agents, employees nor subcontractors are entitled to any damages from the City, nor is any party entitled to be reimbursed by the City, for damages, charges or other ATTACHMENT A 174
losses or expenses incurred by Contractor by reason of delays or hindrances in the performance of the Services, whether or not caused by the City.

4. Standard of Performance
In addition to Exhibit C, Section 4 and 17, Contractor agrees as follows:

4.1 Contractor’s Services shall be performed in accordance with generally accepted professional practices and principles and in a manner consistent with the level of care and skill ordinarily exercised by members of Contractor’s profession currently practicing under similar conditions. Contractor shall comply with the profession’s standard of performance, applicable laws, regulations, and industry standards. By delivery of completed work, Contractor certifies that the work conforms to the requirements of this Agreement and all applicable federal, state and local laws. If Contractor is retained to perform services requiring a license, certification, registration or other similar requirement under California law, Contractor shall maintain that license, certification, registration or other similar requirement throughout the term of this Agreement.

4.2 Contractor acknowledges that it is entrusted with or has access to valuable and confidential information and records of the City and with respect to that information, Contractor agrees to be held to the standard of care of a fiduciary. Contractor shall assure that all services that require the exercise of professional skills or judgment are accomplished by professionals qualified and competent in the applicable discipline and appropriately licensed, if required by law. Contractor must provide copies of any such licenses. Contractor remains responsible for the professional and technical accuracy of all Services or Deliverables furnished, whether by Contractor or its subcontractors or others on its behalf. All Deliverables must be prepared in a form and content satisfactory to the Using Agency and delivered in a timely manner consistent with the requirements of this Agreement.

4.3 If Contractor fails to comply with the foregoing standards, Contractor must perform again, at its own expense, all Services required to be re-performed as a direct or indirect result of that failure. Any review, approval, acceptance or payment for any of the Services by the City does not relieve Contractor of its responsibility for the professional skill and care and technical accuracy of its Services and Deliverables. This provision in no way limits the City’s rights against Contractor either under this Agreement, at law or in equity.

5. Compensation

5.1 In addition to Section 3 Compensation in Exhibit C – GTC, the Contractor shall be compensated for the services provided under this Agreement as follows:

5.1.1 Contractor shall be compensated for services rendered and accepted under this Agreement and shall be paid monthly, in arrears on a not to exceed ATTACHMENT A 175
basis, based upon the rates set forth in Exhibit E attached hereto and made a part of this Agreement. Contractor may vary the compensation for each task in Exhibit E provided that the total project compensation listed in Exhibit E and the Standard Agreement is not exceeded.

6. Personnel

6.1 None of the work or services covered by this Agreement shall be subcontracted without the prior written approval of the City. Any work or services subcontracted hereunder shall be specified by written agreement and shall be subject to each provision of this Agreement. Contractor shall provide subcontractor a copy of this fully executed Agreement.

6.2 Contractor agrees to assign only competent personnel according to the reasonable and customary standards of training and experience in the relevant field to perform services under this Agreement. Failure to assign such competent personnel shall constitute grounds for termination of this Agreement. The payment made to Contractor pursuant to this Agreement shall be the full and complete compensation to which Contractor and Contractor’s officers, employees, agents, and subcontractors are entitled for performance of any work under this Agreement. Neither Contractor nor Contractor’s officers or employees are entitled to any salary or wages, or retirement, health, leave or other fringe benefits applicable to employees of the City. The City will not make any federal or state tax withholdings on behalf of Contractor. The City shall not be required to pay any workers' compensation insurance on behalf of Contractor. Contractor shall pay, when and as due, any and all taxes incurred as a result of Contractor’s compensation hereunder, including estimated taxes, and shall provide City with proof of such payments upon request.

6.3 Key Personnel: Because of the special skills required to satisfy the requirements of this Agreement, Contractor shall not reassign or replace key personnel without the written consent of the City, which consent the City will not unreasonably withhold. "key personnel" means those job titles and the persons assigned to those positions in accordance with the provisions of this Agreement. The City may at any time in writing notify Contractor that the City will no longer accept performance of Services under this Agreement by one or more Key Personnel listed. Upon that notice Contractor shall immediately suspend the services of the key person or persons and must replace him or them in accordance with the terms of this Agreement. A list of key personnel is found in Exhibit A, Scope of Services.

7. Reports and Information
Contractor shall at such times and in such forms as the City may require furnish the City such periodic reports as it may request pertaining to the work or services undertaken pursuant to this Agreement, the costs and obligations incurred or to be incurred in connection therewith, and any other matters are covered by this Agreement as specified in Exhibit A and Exhibit E.

ATTACHMENT A 176

8. Findings Confidential
All of the reports, information, data, et cetera, prepared or assembled by the Contractor under this Agreement are confidential and the Contractor agrees that they shall not be made available to any individual or organization without the prior written approval of the City. Contractor shall not be required under the provisions of this paragraph to keep confidential any data or information which is or becomes publicly available, is required by applicable law or by proper legal or governmental authority, is already rightfully in the Contractor’s possession without obligation of confidentiality, is independently developed by Contractor outside the scope of this Agreement or is rightfully obtained from third parties. Contractor shall give City prompt notice of any such legal or governmental demand and reasonably cooperate with City in any effort to seek a protective order or otherwise to contest such required disclosure.

9. Copyright
No materials, including but not limited to reports, maps, or documents produced as a result of this Agreement, in whole or in part, shall be available to Contractor for copyright purposes. Any such materials produced as a result of this Agreement that might be subject to copyright shall be the property of the City and all such rights shall belong to the City, and the City shall be sole and exclusive entity who may exercise such rights.

10. Deliverables
Contractor shall prepare or provide to the City various Deliverables. "Deliverables" include work product, such as written reviews, recommendations, reports and analyses, produced by Contractor for the City. The City may reject Deliverables that do not include relevant information or data, or do not include all documents or other materials specified in this Agreement or reasonably necessary for the purpose for which the City made this Agreement or for which the City intends to use the Deliverables. If the City determines that Contractor has failed to comply with the foregoing standards, it has 30 days from the discovery to notify Contractor of its failure. If Contractor does not correct the failure, or if it is possible to do so, within 30 days after receipt of notice from the City specifying the failure, then the City, by written notice, may treat the failure as a default of this Agreement.

Partial or incomplete Deliverables may be accepted for review only when required for a specific and well-defined purpose and when consented to in advance by the City. Such Deliverables will not be considered as satisfying the requirements of this Agreement and partial or incomplete Deliverables in no way relieve Contractor of its commitments under this Agreement.

11. Applicable Laws
Deliverables must conform with all applicable federal, state, and local laws. Such conformity includes compliance with federal sanctions, and Contractor certifies that it has not and will not engage in prohibited transactions with sanctioned persons or entities.

ATTACHMENT A 177

EXHIBIT E

COMPENSATION SCHEDULE
The Contractor shall be compensated for the services identified in Exhibit A, Exhibit C, and Exhibit D to this Agreement as follows:

1. Project Price

1.1 The maximum the Contractor shall be paid on this Agreement is $_3,400,000________ (hereafter the “not to exceed” amount). The “not to exceed” amount includes all payments to be made pursuant to this Agreement, including City approved reimbursable expenses, if any. Nothing in this Agreement requires the City to pay for work that does not meet the Standard of Performance identified in Exhibit D section 4 or other requirements of this Agreement.

1.2 Standard Reimbursable Items: Only the reimbursable items identified in Exhibit A, C, and D (Compensation), shall be compensated to the Contractor. Reimbursable expenses will be reimbursed without markup. Fees plus reimbursable expenses shall not exceed the amount set forth in section 1.1 of this Exhibit and a copy of the original invoice for the items listed in i, ii or iii below shall be attached to the invoice submitted to the City for reimbursement. Payments shall be based upon work documents submitted by the Contractor to the City and accepted by the City as being satisfactory to City’s needs. The City shall not pay a markup on any of the items listed in i, ii or iii.

Additionally, items such a telephone, fax, postage or freight are already included in the billable hourly rate. Contractor shall be reimbursed the direct expenses, which are the actual cost of the following items that are reasonable, necessary and actually incurred, by the Contractor in connection with the services:
i. Expenses, fees or charges for printing, reproduction or binding of documents at actual costs with no markup added to the actual cost.
ii. Any filing fees, permit fees, or other fees paid or advanced by the Contractor at actual costs with no markup added to the actual cost.
iii. Travel expenses shall be reimbursed in accordance with the City’s travel policy, which is incorporated herein by reference. Reimbursement shall be made at actual costs with no markup added to the actual cost.

1.3 The Contractor shall be entitled to receive payments for its work performed pursuant to the Agreement. The City will pay Contractor based on invoices for acceptable work performed and approved until the “not to exceed” amount is reached. Thereafter, Contractor must complete services based on the Agreement without additional compensation unless there is a material change to the Statement of Work and Scope by a written Amendment.

1.4 If work is completed before the “not to exceed” amount is reached, the Contractor’s compensation will be based on the Contractor’s invoices previously submitted for acceptable work performed and approved.

ATTACHMENT A 178

1.5 Subcontractor Costs: Compensation for subcontractors shall be limited to the same restrictions imposed on the Contractor. Maximum markup Contractor may apply to subcontractor fees, minus reimbursable expenses, shall not exceed __N/A____%.

2. Task Price. Below is the price for the services and reimbursable expenses as described in Exhibit A of this Agreement.

ATTACHMENT A 179
b.

ATTACHMENT A 180
c.

ATTACHMENT A 181
InfoSend reserves the right to increase InfoSend Fees on an annual basis starting with the first anniversary of the Effective Date to account for increases in the cost of materials, labor, and other overhead. The Client will be notified, in writing, at least thirty (30) days prior to such price increase.

An amendment to the Agreement will not be required if the Fees are changed, unless other terms or conditions of the Agreement have changed. Postage fees can change at any time per USPS regulations and do not require an amendment to the Agreement.

Additionally, if Client uses DPPM Services, InfoSend reserves the right to increase paper, form, and envelope fees as needed, with thirty (30) days’ written notice to Client, in the event of extraordinary increases to the cost of paper.

InfoSend pricing is predicated on Client representations of Client and Client User transactional usage. Should Client’s actual continuous volume and/or recurring frequency deviate by more than thirty percent (30%) from what Client has represented to InfoSend below, then InfoSend reserves the right to invalidate the Fees listed in this Agreement. Should this situation arise then InfoSend will notify Client immediately and negotiate with Client in good faith to pass on any increased costs to Client, in accordance with actual Client and Client User transactional usage. Should InfoSend and Client fail to agree upon updated Fees, InfoSend reserves the right to terminate this Agreement with one hundred and eighty (180) days’ notice.

Client Representations
Client Volume Representations
Customers Contacted or Billed Monthly
109,100 - Printed
Number of Batches Monthly
Daily
Postage Deposit
InfoSend purchases the postage needed to mail Client documents on the day of mailing. The postage charges are later invoiced to Client based on the Client’s payment terms. InfoSend ATTACHMENT A 182
requires Client to submit a postage deposit prior to the first mailing to facilitate the payment terms.

This amount will remain in deposit for the duration of the Agreement. Upon Agreement expiration or termination Client must pay in full any outstanding invoices from InfoSend for payables created under this Agreement; the postage deposit will be refunded within fifteen (15) days of the date that the last open invoice is paid.

The postage deposit amount is calculated by multiplying the estimated number of mail pieces per month by the current 5-Digit pre-sorted first class postage rate. The postage deposit amount due for your account is:
109,100 mail pieces per month x $0.471 = $51,386.10 if NET 15. or
109,100 mail pieces per month x $0.471 x 2 = $102,772.20 if NET 30 The postage deposit is subject to ongoing review and may be adjusted at any time to account for changes to Client average mailing volume or changes to USPS postage rates with at least thirty (30) days’ written notice to Client.

Client Go-Live and Fees
InfoSend will provide Client with a Demo instance of the System to approve configuration and simulation of Services. Upon Client approval of the Demo instance of the System and sample outputs from Services, InfoSend will create a copy of Demo System in Production for completion of final User Acceptance Testing (UAT). Client will be given the UAT Period to complete internal testing prior to initiating Go-Live. All Setup and recurring Monthly Fees will become due upon the sooner of (a) Client Go-Live with the application or (b) 60 days from InfoSend delivery of Production System for UAT.

Implementation Project Cost Subsidization:

InfoSend’s internal costs to complete the project is higher than the Setup fees given. InfoSend has subsidized these fees by factoring in years of service given the term of the Agreement. Should Client cancel the project or terminate the Agreement at its convenience less than one (1) year from the Effective Date then it must pay according to the below:

ATTACHMENT A 183
DPPM Setup Fee: No charge for Express PDF Setup Input files or $2,500 for Data-Only Input Files

3. Hourly Rates. The following is a list of hourly billable rates that Contractor shall apply for additional services requested of the Contractor. Contractor shall be compensated based on the hourly rates set forth below, on a time and material basis for those services that are within the general scope of services of this Agreement, but beyond the description of services required under Exhibit A, and all services are reasonably necessary to complete the standards of performance required by this Agreement. Any changes and related fees shall be mutually agreed upon between the parties by a written amendment to this Agreement.

Hourly Billable Rate Schedule
Title Role on Project
Hourly
Billable
Rates
Professional Services
Fee
$175
$

4. Additional Fees. Should an amendment to the Agreement be issued for additional services that require the following items, the unit prices are as follows:

Title Unit Price
N/A $
ATTACHMENT A 184

5. Invoice to Address. Each invoice submitted shall identify the specific task(s) listed in Exhibit A and this Exhibit, and the completed work product/deliverable for the agreed upon price listed in this Exhibit. Invoices shall be submitted to the below address:

City of Stockton
Administrative Service
Department Attention:

Revenue Officer
425 N. El Dorado
Street Stockton, CA
95202
ATTACHMENT A 185

EXHIBIT F

TIMELINE

1. Contractor shall complete the requested services identified in Exhibit A as follows:

1.1 TIMELINE FOR COMPLETION OF WORK

2.3 Schedule of Transition and Work Plan
Proponent shall provide the City with a comprehensive transition plan detailing the activities needed for transition. The transition plan must ensure there will be no interruptions to the City’s Billing Operations. Provide a detailed work plan to implement utility bill presentment, printing and mailing from contract award to go live. List the steps required and the time required for each step. Specify what resources the City will be required to provide during start-up and over the course of the contract term.

All InfoSend implementations have 4 key phases.

1. Requirements Gathering

2. Application Build

3. User Acceptance Testing (UAT), Samples, Parallel Testing, and Training

4. Go-Live and Follow Up
ATTACHMENT A 186
Requirements Gathering
The project is started with a dedicated Account Manager assigned to the project. The Account Manager acts as the primary point of contact with clients while working with all internal InfoSend programming and operations staff, and will chair a recurring (often weekly) implementation meeting with the client's key staff. InfoSend, as a cloud-based solutions provider, engages clients in implementation and support via phone, email and web-based tools, including web-browser screen sharing. All setup, training and request tracking is provided virtually using industry standard tools. Critical communications sent to or received from clients during the implementation are centrally archived in the InfoSend CRM system, ensuring all aspects are documented and the implementation can continue should the primary resources be out of the office.

Clients check the web application and output to ensure that it is satisfactory and any requested revisions will be completed before go-live. Any payment related applications are tested to ensure payment deposits are received and reconciled. Clients are also trained on how to use InfoSend tools and reporting to support the application at this time.

The hour-long, web-based training covers:
• File uploads
• Sample review and approval
• Managing document messages and insert requests
• Accessing archived reports
• Managing User Permissions
• Performing research and support for customer activity • Payment reconciliation (for payment applications)
• Submitting, viewing and closing support requests
ATTACHMENT A 187
Go-Live and Follow Up
Go-Live of the application includes an "all-hands" approach, with all key InfoSend managers required to review the launch day activity and sign off before application output is final. After Go-live, your Account Manager performs a post go-live follow up to ensure client satisfaction.

This is only a sample 10 week timeline and assumes the Client will be attending weekly meetings and remaining responsive in providing deliverables necessary to complete the project.

Milestone: Requirements Gathering | Weeks 1-3 Responsibility Kick-Off Meeting: Familiarize each party with the project managers assigned to the implementation
InfoSend & Client
Kick-Off Meeting: Review, confirm and discuss the client specifications and requirements
InfoSend & Client
Kick-Off Meeting: Discuss requested formatting changes to client output InfoSend & Client Kick-Off Meeting: Begin development of mockups incorporating client feedback InfoSend Kick-Off Meeting: Fill out Standardized Client Installation Checklist InfoSend Kick-Off Meeting: Begin to discuss data processing details and data mapping in correlation to mockup
InfoSend & Client
Follow Up: Finalize any open items on the Client Installation Checklist InfoSend Follow Up: Review mock-ups via online meeting to incorporate Client feedback in real-time
InfoSend & Client
Follow Up: All Client deliverables received and documented, access to web applications
Client
Follow Up: Continue gathering data processing details and developing programming logic
InfoSend
Follow Up: Provide proofs for custom preprinted form and envelope (if applicable)
InfoSend
Finalize: Approve InfoSend document mockups Client
ATTACHMENT A 188
Finalize: InfoSend will present the Client with a formal Statement of Work (SOW) which captures all requirements for the implementation project and production of outputs.

InfoSend
Finalize: Client reviews SOW and requests changes/clarification on any relevant items.

Client
Finalize: Client approves the SOW, Requirements Gathering complete Client Milestone: Application Build |Weeks 4-6
Development: InfoSend Account Manager meets internally with the InfoSend programming team to execute application per the SOW
InfoSend
Development: Application Development Begins InfoSend
Development: As needed, InfoSend Project Manager verifies additional requirements with Client
InfoSend & Client
Development: Internal Testing and Review of Applications is completed by Project Manager
InfoSend
Development: Internal Development Checklist reaches 100% InfoSend Go-Live Planning: Finalize Go-Live schedule, with relevant dates based on Client billing cycle schedule and staff availability for training InfoSend & Client
Go-Live Planning: Production web application access provisioned InfoSend Milestone: User Acceptance Testing (UAT), Training, Go-Live Coordination | Weeks 7-9 UAT: InfoSend provides first set of samples for review InfoSend UAT: Client reviews the output samples and provides feedback to your Account Manager about requested changes
Client
UAT: Client feedback is communicated to InfoSend’s development team for incorporation into the outputs
InfoSend
UAT: Begin payment/lockbox/other ancillary testing (if applicable) InfoSend & Client UAT: Additional rounds of sample review are conducted for the outputs during weekly meetings
InfoSend & Client
UAT: Final round of changes are conducted for the outputs InfoSend UAT Complete: Provide final approval on the outputs Client UAT Complete: Provide confirmation of payment/lockbox/other ancillary testing completed
Client
UAT Complete: Review Statement of Work (SOW) during weekly meeting and confirm all requirements met
InfoSend & Client
ATTACHMENT A 189
Training: Conduct training for Client staff on InfoSend systems and application management
InfoSend & Client
Go-Live Coordination: Begin parallel testing of application, including any automation scripts
InfoSend & Client
Go-Live Coordination: Complete parallel testing of application InfoSend & Client Go-Live Coordination: Internal Go-Live readiness checklist completed by Project Team and Management
InfoSend
Milestone: Go-Live | Week 10
Go-Live: Receive and process first live file for distribution InfoSend Go-Live: Internal "First Live Run" Checklist completed, with review and signatures required from each department manager
InfoSend
Follow Up and Support: continue weekly meetings to cover additional questions or training until client satisfaction
InfoSend & Client
Follow Up and Support: send implementation survey and make management team available to ensure satisfaction
InfoSend
ATTACHMENT A 190
Page | 1
(8/320)
Exhibit G

DOES NOT APPLY
ATTACHMENT A 191
City of Stockton
Legislation Text
File #: 23-0487, Version: 1
ACCEPT THE SINGLE AUDIT AND INDEPENDENT AUDITORS’ REPORTS AND THE REPORT ON INTERNAL CONTROLS FOR THE YEAR ENDED JUNE 30, 2022

RECOMMENDATION
It is recommended that the City Council accept by motion the Single Audit and Independent Auditors’ Reports and the Report on Internal Control Related Matters Identified in the Audit for the year ended June 30, 2022.

Summary
Presented for the City Council’s review is the City of Stockton’s Single Audit and Independent Auditors’ Reports (Attachment A) for the year ended June 30, 2022. On May 15, 2023, the Audit Committee received, reviewed, and accepted these audit reports. The Single Audit report identifies six (6) new findings or questioned costs. Staff recommends that Council adopt the motion as proposed.

DISCUSSION
Background
The Single Audit and Independent Auditors’ Reports (Attachment A) is an annual audit of federal awards or pass-through of federal awards to the City.

The Report on Internal Controls provides a review of the City’s financial reporting systems and procedures that are used to ensure accurate financial statements. An internal control is designed to provide reasonable assurance that the City meets its objectives regarding the reliability of financial reporting, effectiveness, and efficiency of operations and compliance with applicable laws and regulations. The auditor considers the City’s internal control over financial reporting during the design of audit procedures for financial statements. The auditors do not express any opinion on the effectiveness of the City’s internal controls.

This information was presented to the Council Audit Committee on May 15, 2023.

Present Situation
With an influx of COVID-19 related Federal stimulus funds, the City’s expenditures of federal awards increased by over 306%, or $136.7 million, in Fiscal Year (FY) 2021-22 to $181.3 million. Program and administrative staff have not increased sufficiently to properly administer the increase in federal awards and the variety of new programs. Each new program has a separate set of regulations to be followed. Examples of new programs include American Rescue Plan Act Coronavirus State and Local Fiscal Recovery Funds, Water Infrastructure Finance and Innovation (WIFIA), California City of Stockton Page 1 of 3 Printed on 5/16/2023
powered by Legistar™
192
File #: 23-0487, Version: 1
Wastewater and Water Arrearage Payment Programs, and Emergency Rental Assistance passed through the State of California.

The Single Audit report identifies six (6) new findings or questioned costs summarized below:
2022-001 Internal Control Over Financial Reporting - Prior Year Adjustments, Year-End Closing, Reconciliation, and Delay in Issuance of the Single Audit Condition:

The Successor Agency to the Redevelopment Agency reported a $1,868,468 correction to cash with fiscal agent balance which restated net position from $(59,008,834) to $(60,877,302). In addition, the City has experienced significant challenges in the reconciliation of subsidiary ledgers to the general ledger, along with the preparation and issuance of the Single Audit required under Uniform Guidance.

City’s Corrective Actions:

Staff has taken additional measures to develop several reconciliation tools that will enhance their ability to thoroughly review and reconcile each fund and reconcile stale balances. 2022-002 Internal Control Over Preparation of Schedule of Expenditures of Federal Awards Condition:

During the audit there were multiple rounds of revisions to the Schedule of Expenditures of Federal Awards. Included in the revisions were the reporting of state pass-through awards for the Emergency Rental Assistance Program (ERAP) of $18.6 million and American Rescue Plan Act (ARPA) Water/Wastewater Arrearage of $3.6 million.

City’s Corrective Actions:

Due to the vacancy in the central grants division, the City has been left with insufficient coverage of the processes and procedures that need to be maintained for grant compliance. Re-evaluation of the needs of both the Finance and Grant departments will assist in the identification and reporting of federal grant information. Program and fiscal staff working with grant agreements will be provided with language to look for in agreements that identify when the grant is a pass-through from the federal government. Finance staff can review this as part of the grant master workflow. 2022-003 Eligibility - Internal Controls Over Eligibility Condition:

The application reviewer made data entry errors and incorrectly reported actual income reported by applicants in 4 of the 40 samples selected.

City’s Corrective Actions:

As part of the review process conducted by El Concilio (Contractor), a number of documents (including income verification) were reviewed to ensure that the household was eligible for funding under the Emergency Rental Assistance Program (ERAP). In all instances, the income was reviewed and determined to be under the eligibility threshold. However, the “Monthly Income Correction” feature in the Intake System was utilized to make an income determination of $0. The “Monthly Income Correction” does not necessarily mean that the income was not accurately verified. There were no instances in which any of the samples had income that was over the established limits.

City of Stockton Page 2 of 3 Printed on 5/16/2023
powered by Legistar™
193
File #: 23-0487, Version: 1
2022-004 Procurement and Suspension, and Debarment - Internal Control over Verification Against the System for Award Management (“SAM”)
Condition:

The City did not maintain proof of verification against “SAM” to ensure that vendors were not suspended or debarred from federally funded purchases.

City’s Corrective Actions:

The City has always conducted debarment checks but has not maintained proof of verification. The procurement division has been alerted to this requirement and has changed its process to include documentation of the suspension and debarment checks.
2022-005 Reporting - Internal Control and Compliance over reporting Condition:

The City was not aware of all reporting requirements for the Water Infrastructure Finance and Innovation (WIFIA) program; only Construction reports were filed in a timely manner.

City’s Corrective Actions:

A recent appointment to the Debt and Treasury division has allowed for restructuring of the processes present within the division. Debt and Treasury personnel have been made aware of the previous insufficiencies and will work with funding sources to identify which requirements are fulfilled by external project managers and which requirements need to be fulfilled by City staff. 2022-006 Special Tests and Provisions - Internal Control and Compliance Over Obligations, Expenditures, and Payment Requirements
Condition:

Subrecipient payment requests for the Emergency Solutions Grant Program (ESG) were not completed within 30 days.

City’s Corrective Actions:

When invoices from subrecipients are received, they are reviewed thoroughly by staff. During the review process, it may be determined that the information provided is not sufficient to support the claim/amount for reimbursement. This initiates a back and forth between staff and the subrecipient that could take up to several weeks to resolve. The Economic Development Department continuously holds workshops with all vendors/subrecipients on best practices, and invoicing procedures to reduce the time spent reviewing invoices. The Department spends considerable effort in working with all subrecipients to expedite documentation review and payment process and continues to make improvements in this area. Staff will also maintain records of any delays in processing because of insufficient documentation submitted by the subrecipient.

FINANCIAL SUMMARY
There is no financial impact associated with accepting this item.

Attachment A - 2022 Single Audit and Independent Auditors’ Reports City of Stockton Page 3 of 3 Printed on 5/16/2023
powered by Legistar™
194
City of Stockton
Stockton, California
Single Audit
and Independent Auditors’ Reports
For the Year Ended June 30, 2022
Attachment A 195
Attachment A 196
City of Stockton
Single Audit Report
For the Year Ended June 30, 2022
Table of Contents
Page
Independent Auditors’ Reports:

Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ................................................................. 1 Report on Compliance for Each Major Federal Program;
Report on Internal Control Over Compliance; and Report on the Schedule of Expenditures of Federal Awards Required by the Uniform Guidance ....................................................... 3 Schedule of Expenditures of Federal Awards ............................................................................................................ 6 Notes to the Schedule of Expenditures of Federal Awards ........................................................................................ 9 Schedule of Findings and Questioned Costs ............................................................................................................ 10 Attachment A 197
This page intentionally left blank.

Attachment A 198
200 E. Sandpointe Avenue, Suite 600
Santa Ana, California 92707

REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND

OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN

ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
Independent Auditors’ Report
To the Honorable Mayor and Members of City Council
of the City of Stockton
Stockton, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City of Stockton, California (the “City”), as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements, and have issued our report thereon dated January 30, 2023.

Report on Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered the City’s internal control over financial reporting (“internal control”) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal control. Accordingly, we do not express an opinion on the effectiveness of the City’s internal control.

Our consideration of internal control was for the limited purpose described in the preceding paragraph and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies and therefore, material weaknesses or significant deficiencies may exist that were not identified. However, as described in the accompanying schedule of findings and questioned costs, we identified certain deficiencies in internal control that we consider to be material weaknesses and significant deficiencies.

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected, on a timely basis. We consider the deficiencies described in the accompanying schedule of findings and questioned costs as item 2022-002 to be a material weakness.

Attachment A 199
To the Honorable Mayor and Members of City Council
of the City of Stockton
Stockton, California

Page 2 ends

2 A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. We consider the deficiencies described in the accompanying schedule of findings and questioned costs as item 2022-001 to be a significant deficiency.

Report on Compliance and Other Matters
As part of obtaining reasonable assurance about whether the City's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are require to be reported under Government Auditing Standards.

City’s Response to Findings
Government Auditing Standards requires the auditor to perform limited procedures on the City’s response to the findings identified in our audit and described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the other auditing procedures applied in the audit of the financial statements and, accordingly, we express no opinion on the response.

Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose.

Santa Ana, California
January 30, 2023
Attachment A 200
200 E. Sandpointe Avenue, Suite 600
Santa Ana, California 92707
REPORT ON COMPLIANCE FOR EACH MAJOR FEDERAL PROGRAM; REPORT ON INTERNAL CONTROL OVER COMPLIANCE; AND REPORT ON THE SCHEDULE OF EXPENDITURES OF

FEDERAL AWARDS REQUIRED BY THE UNIFORM GUIDANCE
Independent Auditors’ Report
To the Honorable Mayor and Members of City Council
of the City of Stockton
Stockton, California
Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program
We have audited the City of Stockton, California’s (the “City”) compliance with the types of compliance requirements identified as subject to audit in the OMB Compliance Supplement that could have a direct and material effect on each of the City’s major federal programs for the year ended June 30, 2022. The City’s major federal programs are identified in the summary of auditors’ results section of the accompanying schedule of findings and questioned costs.

In our opinion, the City complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2022.

Basis for Opinion on Each Major Federal Program
We conducted our audit of compliance in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States; and the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the “Uniform Guidance”). Our responsibilities under those standards and the Uniform Guidance are further described in the Auditors’ Responsibilities for the Audit of Compliance section of our report.

We are required to be independent of City and to meet our other ethical responsibilities, in accordance with relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion on compliance for each major federal program. Our audit does not provide a legal determination of City’s compliance with the compliance requirements referred to above.

Responsibilities of Management for Compliance
Management is responsible for compliance with the requirements referred to above and for the design, implementation, and maintenance of effective internal control over compliance with the requirements of laws, statutes, regulations, rules, and provisions of contracts or grant agreements applicable to City’s federal programs.

Attachment A 201
To the Honorable Mayor and Members of City Council
of the City of Stockton
Stockton, California

Page 2 ends

4 Auditors’ Responsibilities for the Audit of Compliance Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on City’s compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about City’s compliance with the requirements of each major federal program as a whole.

In performing an audit in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance, we:
 Exercise professional judgment and maintain professional skepticism throughout the audit.  Identify and assess the risks of material noncompliance, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding City’s compliance with the compliance requirements referred to above and performing such other procedures as we considered necessary in the circumstances.  Obtain an understanding of City’s internal control over compliance relevant to the audit in order to design audit procedures that are appropriate in the circumstances and to test and report on internal control over compliance in accordance with the Uniform Guidance, but not for the purpose of expressing an opinion on the effectiveness of City’s internal control over compliance. Accordingly, no such opinion is expressed.

We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and any significant deficiencies and material weaknesses in internal control over compliance that we identified during the audit.

Other Matters
The results of our auditing procedures disclosed instances of noncompliance which are required to be reported in accordance with the Uniform Guidance and which are described in the accompanying schedule of findings and questioned costs as items 2022-005 and 2022-006. Our opinion on each major federal program is not modified with respect to these matters.

Government Auditing Standards requires the auditor to perform limited procedures on City’s response to the noncompliance findings identified in our audit described in the accompanying schedule of findings and questioned costs. City’s response was not subjected to the other auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response.

Report on Internal Control Over Compliance
Our consideration of internal control over compliance was for the limited purpose described in the Auditors’ Responsibilities for the Audit of Compliance section above and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance and therefore, material weaknesses or significant deficiencies may exist that were not identified. We did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses.

Attachment A 202
To the Honorable Mayor and Members of City Council
of the City of Stockton
Stockton, California

Page 3 ends

5 However, as discussed below, we did identify certain deficiencies in internal control over compliance that we consider to be significant deficiencies.

A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance. We consider the deficiencies in internal control over compliance described in the accompanying schedule of findings and questioned costs as items 2022-003, 2022-004, 2022-005, and 2022-006, to be significant deficiencies.

Our audit was not designed for the purpose of expressing an opinion on the effectiveness of internal control over compliance. Accordingly, no such opinion is expressed.

Government Auditing Standards requires the auditor to perform limited procedures City’s response to the internal control over compliance findings identified in our compliance audit described in the accompanying schedule of findings and questioned costs. The City’s response was not subjected to the other auditing procedures applied in the audit of compliance and, accordingly, we express no opinion on the response.

The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance.

Accordingly, this report is not suitable for any other purpose.

Report on the Schedule of Expenditures of Federal Awards Required by Uniform Guidance We have audited the financial statements of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the City as of and for the year ended June 30, 2022, and the related notes to the financial statements, which collectively comprise the City’s basic financial statements. We issued our report thereon dated January 30, 2023, which contained unmodified opinions on those financial statements. Our audit was conducted for the purpose of forming our opinions on the financial statements that collectively comprise the City’s basic financial statements. The accompanying Schedule of Expenditures of Federal Awards is presented for purposes of additional analysis as required by Uniform Guidance and is not a required part of the basic financial statements. Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain other procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the Schedule of Expenditure of Federal Awards is fairly stated in all material respects in relation to the basic financial statements as a whole.

Santa Ana, California
May 9, 2023, except for the Schedule of Expenditures of Federal Awards, which is as of January 30, 2023.

Attachment A 203
City of Stockton
Schedule of Expenditures of Federal Awards
For the Year Ended June 30, 2022
See accompanying Notes to the Schedule of Expenditures of Federal Awards. 6 Assistance Amount
Listing Grant Award Federal Provided to
Number Number Expenditures Subrecipients
U.S. Department of Housing and Urban Development
Direct Program:

CDBG - Entitlement Grants Cluster:

Community Development Block Grants/Entitlement Grants 14.218 B-19-MC-06-0026 $ 62,140 $ 62,140 Community Development Block Grants/Entitlement Grants 14.218 B-20-MC-06-0026 370,111 370,111 Community Development Block Grants/Entitlement Grants 14.218 B-21-MC-06-0026 2,807,169 - Community Development Block Grants/Entitlement Grants 14.218 B-21-MC-06-0026 408,172 408,172 Community Development Block Grants/Entitlement Grants 14.218 Program Income 101,732 - COVID-19 Community Development Block Grants/Entitlement Grants 14.218 B-20-MW-06-0026 323,601 187,315 Neighborhood Stabilization Program 14.218 B-08-MN-060009 2,090 - Neighborhood Stabilization Program 14.218 B-11-MN-060009 2,315 - Total CDBG - Entitlement Grants Cluster 4,077,330 1,027,738 Emergency Solutions Grant Program 14.231 E-20-MC-06-0026 107,570 107,570 Emergency Solutions Grant Program 14.231 E-21-MC-06-0026 239,717 228,407 COVID-19 Emergency Solutions Grant Program 14.231 E-20-MW-06-0026 4,888,469 3,196,890 Total Emergency Solutions Grant Program 5,235,756 3,532,867 HOME Investment Partnership Program 14.239 M-21-MC-06-0221 143,410 - HOME Investment Partnership Program 14.239 M-20-MC-06-0221 296,603 - HOME Investment Partnership Program 14.239 M-21-MC-06-0221 303,397 - Total HOME Investment Partnership Program 743,410 -
Total U.S. Department of Housing and Urban Development 10,056,496 4,560,605 U.S. Department of Justice
Direct Program:

COVID - 19 Coronavirus Emergency Supplemental Funding Program 16.034 2020-VD-BX-1296 701,682 - Total Coronavirus Emergency Supplemental Funding 701,682 - Community-Based Violence Prevention Program 16.123 2020-PB-BX-0021 31,625 - Total Community-Based Violence Prevention Program 31,625 - Pass-Through San Joaquin County District Attorney’s Office:

Edward Byrne Memorial Justice Assistance Grant Program 16.738 2018-DJ-BX-0823 30,808 - Edward Byrne Memorial Justice Assistance Grant Program 16.738 2019-DJ-BX-0623 63,408 - Edward Byrne Memorial Justice Assistance Grant Program 16.738 2020-DJ-BX-0458 127,088 - Total Edward Bryne Memorial Justice Assistance Grant Program 221,304 - Total U.S. Department of Justice 954,611 -
U.S. Department of Transportation
Pass-Through State of California Department of Transportation:

Highway Planning and Construction Cluster:

Filbert/Miner Traffic Sig 20.205 CML-5008(130) 6,465 -
West Lane Ped Access Imp 20.205 HSIPL-5008(136) 665,939 - Bus Rapid Transit 1-B 20.205 CML-5008(148) 9,225 -
BUS RAPID TRANSIT 1-B 20.205 CML-5008(188) 555,378 -
BUS RAPID TRANSIT V 20.205 CML-5008(149) 12,301 -
INSTALL/UPGRADE BIKE FAC 20.205 CML-5008(150) 167,999 - THORNTON @ HAMMER & LOWER SAC 20.205 CML-5008(156) 558,743 - Federal Grantor/Pass-Through Grantor
Program Title
Attachment A 204
City of Stockton
Schedule of Expenditures of Federal Awards (Continued)
For the Year Ended June 30, 2022
See accompanying Notes to the Schedule of Expenditures of Federal Awards. 7 Assistance Amount
Listing Grant Award Federal Provided to
Number Number Expenditures Subrecipients
U.S. Department of Transportation (continued)
Pass-Through State of California Department of Transportation (Continued):

Highway Planning and Construction Cluster (Continued):

BRIDGE REHAB/REPLACEMENT 20.205 BPMP-5008(157) 7,548 -
HAWK PED SIGNAL INSTALL 7 20.205 HSIPL-5008(151) 180,570 - GUARDRAIL, TRANSITION RAIL 20.205 HSIPL-5008(152) 188,200 - MINER AVE COMP ST IMPR PH1 20.205 ATPL-5008(158) 885,094 - HUNTER ST DIET/BIKE INSTL 20.205 HSIPL-5008(155) 5,328 - WEST LN TRAF SIG CONTROL SYS 20.205 CML-5008(165) 11,938 - HIGH FRICTION TREATMENT 20.205 HSIPL-5008(153) 637,167 - BEAR CREEK/PIXLEY SLOUGH BIKE 20.205 CML-5008-(175) (3,802) - CLOSING GAPS TO SCHOOL 20.205 ATPCML-5008-(178) 1,148,471 - HSIP 8-CONVT SIGNL FR PED 20.205 HSIPL-5008(166) 35,745 - HSIP 8-INSTALL GUARDRAILS 20.205 HSIP-5008(168) 11,406 - HSIP 8-INSTALL PED XNG 9 20.205 HSIPL-5008(161) (23,990) - HSIP 8-RAISED MED @ MLK 20.205 HSIPL-5008(167) 73,453 - HSIP 8-RAISED MED @ PACIFIC 20.205 HSIPL-5008(164) 9,945 - HSIP 8-RAISED MED @ EL DORADO 20.205 HRRRL-5008(163) 734 - HSIP 8-ROAD DIET @ EL DORADO 20.205 HSIPL-5008(162) 2,621 - LT TURN ADD @ VARIOUS LOC 20.205 CML-5008(169) (102,038) - LINCOLN/ 8TH ROUNDABOUT 20.205 CML-5008(176) 13,610 -
MARCH LN EBMUD BIKE & PED 20.205 CML-5008(179) 10,634 - MONTAUBAN/HAMMERTOWN RND 20.205 CML-5008(174) 6,488 -
PACIFIC/MARCH INTRSEC MOD 20.205 CML-5008(181) 5,301 -
REALTIME TRAFFIC FLOW MONITOR 20.205 CML-5008(180) 29,285 - TAM O'SHANTER/KNICKERBOCK 20.205 CML-5008(173) 555,540 - HSIP 9-LT EL DORADO/MARCH 20.205 HSIPL-5008(183) (1,143) - HSIP 9-LT AIRPORT/HAZELTN 20.205 HSIPL-5008(184) 10,041 - HSIP 9-SIDEWLK MED MLK BL 20.205 HSIPL-5008(186) 10,551 - HSIP 9-REC RPD FLSH BCONS 20.205 HSIPL-5008(185) 1,521 - 19-20 ST RESURFAC ON FED 20.205 STPL-5008(190) 2,047,268 - TRANSP MGMT CTR EQUIP UPG 20.205 CML-5008(191) 75,132 - ARCH-AIRPORT RD TS SYNCH 20.205 CML-5008(192) 33,989 -
ALPINE & ALVARADO 3-WY TS 20.205 CML-5008(193) 23,424 - Total Highway Planning and Construction Cluster: 7,866,081 - Pass-Through State of California Office of Traffic Safety:

Highway Safety Cluster:

State and Community Highway Safety 20.600 PT22087 83,603 - State and Community Highway Safety 20.600 PT21067 12,163 - Total State and Community Highway Safety 95,766
Coronavirus Emergency Supplemental Funding Program 20.616 TR22010 24,800 - Total Highway Safety Cluster 120,566 -
Minimum Penalties for Repeat Offenders for Driving While Intoxicated 20.608 PT22087 156,232 - Minimum Penalties for Repeat Offenders for Driving While Intoxicated 20.608 PT21067 109,123 - Total Minimum Penalties for Repeat Offenders for Driving While Intoxicated 265,355 - Total U.S. Department of Transportation 8,252,002 -
Federal Grantor/Pass-Through Grantor
Program Title
Attachment A 205
City of Stockton
Schedule of Expenditures of Federal Awards (Continued)
For the Year Ended June 30, 2022
See accompanying Notes to the Schedule of Expenditures of Federal Awards.

8 Assistance Amount
Listing Grant Award Federal Provided to
Number Number Expenditures Subrecipients
U.S. Treasury
Direct Program:

Coronavirus State and Local Fiscal Recovery Funds 21.027 N/A 11,071,923 - Pass-Through State of California State Water Resources Control Board:

CA WasteWater Arrearage Payment Program 21.027 N/A 2,032,055 - CA Water Arrearage Payment Program 21.027 N/A 1,567,612 - Total Coronavirus State and Local Fiscal Recovery Funds 14,671,590 - Emergency Rental Assistance Program:

Direct Program:

Emergency Rental Assistance 21.023 N/A 18,547,416 -
Passed through the State of California Department of Housing and Community Development:

Emergency Rental Assistance 21.023 N/A 18,614,118 -
Total Emergency Rental Assistance 37,161,534
Total U.S. Treasury 51,833,124 -
U.S. Small Business Administration
Direct Program:

Shuttered Venue Operators Grant Program 59.075 SBAHQ21SV009148 239,428 - Total U.S. Small Business Administration 239,428 -
U.S. Environmental Protection Agency
Direct Program:

Brownfields Training, Research, and Technical Assistance Grants and Cooperative Agreements 66.818 99T74401 187,962 -
Water Infrastructure Finance and Innovation (WIFIA) 66.958 N/A 108,000,000 - Total U.S. Environmental Protection Agency 108,187,962 - U.S. Department of Homeland Security
Direct Program:

Assistant to Firefighters Grant (AFG) 97.044 EMW-2018-FO-04270 202,845 - COVID-19 Assistant to Firefighters Grant (AFG) 97.044 EMW-2020-FG-00464 1,181,818 - Staffing for Adequate Fire and Emergency Response (SAFER) 97.083 EMW-2020-FF-01451 353,230 - Total Assistant to Firefighters Grant (AFG) 1,737,893 - Total U.S. Department of Homeland Security 1,737,893 -
Total Expenditures of Federal Awards $ 181,261,516 $ 4,560,605 Federal Grantor/Pass-Through Grantor
Program Title
Attachment A 206
City of Stockton
Notes to the Schedule of Expenditures of Federal Awards For the Year Ended June 30, 2022
9 Note 1 – Reporting Entity
The financial reporting entity consists of the primary government, City of Stockton, California (the “City”), organizations for which the primary government is financially accountable, and other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity’s financial statements to be misleading or incomplete.

The City Council acts as the governing body and is able to impose its will on the following organizations, establishing financial accountability:
 The Stockton Public Financing Authority
 Fiduciary Component Unit:
 Successor Agency of the Former Redevelopment Agency of the City of Stockton Note 2 – Basis of Presentation
The accompanying Schedule of Expenditures of Federal Awards (the "Schedule") includes the federal award activity of City under programs of the federal government for the year ended June 30, 2022. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the “Uniform Guidance”). Because the Schedule presents only a selected portion of the operations of City, it is not intended to and does not present the financial position of the City. Negative amounts reflected in the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.

Note 3 – Summary of Significant Accounting Policies
Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.

Note 4 - Indirect Cost Rate
The City has not elected to use the 10 percent de-minimis indirect rate as allowed under Uniform Guidance.

Attachment A 207
City of Stockton
Schedule of Findings and Questioned Costs
For the Year Ended June 30, 2022
10 Section I – Summary of Auditors’ Results
Financial Statements
Types of report the auditors issued on whether the financial statements audited were prepared in accordance with GAAP: Unmodified Internal control over financial reporting:
 Material weakness(es) identified? 2022-002
 Significant deficiency(ies) identified? 2022-001
Noncompliance material to financial statements noted? No Federal Awards
Internal control over major federal programs:
 Material weakness(es) identified? No
 Significant deficiency(ies) identified? 2022-003 to 2022-006 Type of auditors’ report issued on compliance for major federal programs: Unmodified Any audit findings disclosed that are required to be reported in accordance with 2 CFR 200.516(a)? Yes
Identification of major federal programs:

Assistance Listing
Number(s) Name of Federal Program or Cluster Expenditures

14.231 Emergency Solutions Grants Program $ 5,235,756

20.205 Highway Planning and Construction Cluster 7,866,081

21.023 Emergency Rental Assistance Program 37,161,534

21.027 Coronavirus State and Local Fiscal Recovery Funds 14,671,590

66.958 Water Infrastructure Finance and Innovation (WIFIA) 108,000,000 Total Expenditures of All Major Federal Programs $ 172,934,961 Total Expenditures of Federal Awards $ 181,261,516
Percentage of Total Expenditures of Federal Awards 95.41% Dollar threshold used to distinguish between type A and type B programs: $3,000,000 Auditee qualified as low-risk auditee under 2 CFR 500.520? Yes Attachment A 208
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
11 Section II – Financial Statements Findings
A. Current Year Findings– Financial Statement Findings
2022-001 – Internal Control Over Financial Reporting – Prior Year Adjustments, Year-End Closing, Reconciliation, and Delay in Issuance of the Single Audit Criteria:

Management is responsible for the preparation and fair presentation as well as the accuracy of its financial statements including disclosures in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. As part of satisfying that responsibility, management should ensure complete year-end closing and diligently produce reliable and accurate financial information.

Generally accepted auditing standards defined internal control as a process – affected by the Members of City Council, management, and other personnel – designed to provide reasonable assurance regarding the achievement of objectives in the following categories:
 Reliability of financial reporting
 Effectiveness and efficiency of operations, and
 Compliance with applicable laws and regulations.

In essences, accounting policies and procedures would aid the City in providing training for accounting personnel, communicating and providing a source of reference to approved policies, and maintaining consistency of recording financial transactions.

Management is responsible for providing timely and accurate financial information. Since the City has expended over $750,000 of expenditures of federal awards, Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Aware (“Uniform Guidance”), states the City is required to submit the Data Collection Form and the reporting package to the Federal Audit Clearinghouse and the State Controller’s Office, which include the Basic Financial Statements of the City, within the earlier of 30 days after receipt of auditor’s report, or nine month after the end of the audit period.

Condition:

During the year ended June 30, 2022, the Successor Agency to the Redevelopment Agency reported a correction of cash with fiscal agent in the amount of $1,868,468 and the adjustment resulted in the net position restatement from $(59,008,834) to $(60,877,302).

During the audit, we noted stale receivable and payable to be reconciled from the subsidiary ledgers to the general ledgers.

The City has experienced significant delays in the preparation and issuance of the Single Audit required under Uniform Guidance. Due to the delay in issuance of the Single Audit report, the Data Collection Form is not submitted timely.

Attachment A 209
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
12 Section II – Financial Statements Findings (Continued) A. Current Year Findings– Financial Statement Findings (Continued) 2022-001 – Internal Control Over Financial Reporting – Prior Year Adjustments, Year-End Closing, Reconciliation, and Delay in Issuance of the Single Audit (Continued) Cause:

There is no formal process in place to conduct periodic review and reconciliation of the sub-ledger to the general ledger. Furthermore, detailed review and reconciliation of the general ledger balances from the old financial system (HTE) to the current financial system (MUNIS) is incomplete.

Context and Effect:

A prior period adjustment is reported as noted in the Condition. Without further reviewing and reconciling the time of the transition from the old financial system to the Munis, stale receivable and payable could result in material misstatement of the financial statements.

The City is neither in compliance with Uniform Guidance nor is it meeting its current demands for external financial reporting.

Recommendation:

We recommend the City evaluate its staff size for Finance Division. We also recommend the City update and follow its policy to review and reconcile the general ledger. The policy and procedures should also include the year-end closing procedures and the accounts to be reconciled in accordance with Governmental Accounting Standards Board Statements and provide training to staff to properly perform the reconciliation and closing.

In addition, the policy and procedures should include critical due dates and develop a listing of assignment, including department coordinated items, based on available resources to meet those due dates.

Views of Responsible Officials:

Management concurs the finding.

Attachment A 210
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
13 Section II – Financial Statements Findings (Continued) A. Current Year Findings– Financial Statement Findings (Continued) 2022-002 – Internal Control Over Preparation of Schedule of Expenditures of Federal Awards Criteria:
2 CFR 200.302(b)(1) states that the nonfederal entity must identify in its accounts all federal awards received and expended, as well as the federal programs under which they were received. Federal program and award identification must include, as applicable, the assistance listing title and number, the federal award identification number and year, the name of the federal agency, and the name of the pass-through entity, if any. This information enables the auditee to reconcile amounts presented in the financial statements to related amounts in the schedule of expenditures of federal awards.

Pursuant to Code of Federal Regulation §200.510 Financial statements:

All auditees must:
(b) Schedule of expenditures of Federal awards. The auditee must also prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements which must include the total Federal awards expended as determined in accordance with §200.502 Basis for determining Federal awards expended. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple Federal award years, the auditee may list the amount of Federal awards expended for each Federal award year separately. At a minimum, the schedule must:
(1) List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name.

For R&D, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. For example, the National Institutes of Health is a major subdivision in the Department of Health and Human Services. (2) Provide total Federal awards expended for each individual Federal program and the assistance listing number or other identifying number when the assistance listing number information is not available. For a cluster of programs also provide the total for the cluster.

Pursuant to Code of Federal Regulation §200.514 Scope of audit:
(b) Financial statements. The auditor must determine whether the financial statements of the auditee are presented fairly in all material respects in accordance with generally accepted accounting principles. The auditor must also determine whether the schedule of expenditures of Federal awards is stated fairly in all material respects in relation to the auditee's financial statements as a whole.

Attachment A 211
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
14 Section II – Financial Statements Findings (Continued) A. Current Year Findings– Financial Statement Findings (Continued) 2022-002 – Internal Control Over Preparation of Schedule of Expenditures of Federal Awards (Continued) Condition:

During our review of the Schedule of Expenditures of Federal Awards (“Schedule”) provided by the City, we noted the Emergency Rental Assistance Program, passed through the State of California in the amount of $18,614,118 were excluded in the Schedule.

During the audit, there were multiple rounds of revisions to the Schedule that were provided by the City. Included in the revision was the Federal related expenditures for the American Rescue Plan Act, that passed through the California State Water Resource Control Board, in the amount of $3,599,667, which was initially excluded from the Schedule.

Cause:

There was insufficient communication between the Finance Division and project managers overseeing the federal programs and inadequate training to correctly identify funding sources.

Context and Effect:

With a vacancy in the grants department and receipt of unprecedented COVID relief pass through funding, this challenged the departments with insufficient knowledge of the proper reporting processes.

Recommendation:

We recommend frequent communication between the Finance Division and other departments in identifying federal programs. In addition, we recommend the City provide more training to both grant management staff and finance staff to enhance the skill in identifying pass through programs and ensure the accuracy and completeness of the Schedule.

Views of Responsible Officials:

Management concurs the finding.

Attachment A 212
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
15 Section II – Financial Statements Findings (Continued) B. Prior Year Findings – Financial Statement Findings
No prior year financial statement findings and questioned costs were noted.

Attachment A 213
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
16 Section III – Federal Awards Finding and Questioned Costs A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit 2022-003 - Eligibility – Internal Control Over Eligibility Identification of the Federal Program:

Assistance Listing Number: 21.023
Assistance Listing Title: Emergency Rental Assistance Program Federal Agency: Department of Treasury
Pass-Through Entity: State of California Department of Finance Federal Award Identification Number: N/A
Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation):

Pursuant to the April 2022 Compliance Supplement, Eligibility:

This approach to eligibility was implemented in accordance with Consolidated Appropriations Act, 2021, for ERA 1 in sections 501(c)(2)(C)(ii) of the Act concerning documentation of payments to households, sections 501(f)(2)(A) and (B) of the Act concerning signature requirements for applications and documentation required for tenants, section 501(k)(1) concerning area median income determinations, and sections 501(k)(3)(A)(I) and (II) concerning eligible household determinations and attestation requirements. This treatment is further explained in the ERA FAQs; the Consolidated Appropriations Act, 2021; and the Treasury, Department of Justice and Department of Housing and Urban Development joint letter issued August 27, 2021 (https://home.treasury.gov/system/files/136/EvictionMoratorium-Joint-Letter.pdf).

To the extent that a grantee has established and consistently followed its own reasonable procedures for implementing an eligibility determination process, consistent with Treasury’s guidance, it is not Treasury’s expectation that grantees should seek additional documentation from a beneficiary after the initial determination of eligibility has been completed, including for those determined to be eligible using self-attestation, categorical eligibility, or fact-specific proxies in qualifying circumstances. Testing of individual household eligibility-related documentation should be limited to material already collected by the grantee during application as much as possible to avoid imposing undue burden on households that remain at risk of housing instability.

Condition:

During our audit, we noted 4 samples out of 40 samples selected for the eligibility requirement testing with internal control deficiency related to the income eligibility verification. The application reviewer made errors on data input and reported those applicants’ income as zero instead of the actual income provided by the applicants. However, we recalculated those four applicants’ income based on the income verification support provided and those applicants were eligible to receive the grant subsidy based on the income limit.

Cause:

The City did not have proper internal controls in place to review the data input performed by the application reviewer.

Effect or Potential Effect:

The City could potentially be out of compliance with the eligibility requirement due to the error in executing the internal control procedures.

Attachment A 214
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
17 Section III – Federal Awards Finding and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) 2022-003 - Eligibility – Internal Control Over Eligibility (Continued) Questioned Costs:

None.

Context:

See condition above for the context of the finding.

Identification as a Repeat Finding, If Applicable:

Not applicable.

Recommendation:

We recommend the City enhance its internal control by implementing policies and procedures over eligibility requirement.

Views of Responsible Officials:

Management concurs the finding.

Attachment A 215
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
18 Section III – Federal Awards Finding and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) 2022-004 - Procurement and Suspension, and Debarment – Internal Control over Verification Against the System for Award Management (“SAM”)
Identification of the Federal Program (s):

Assistance Listing Number: 20.205
Assistance Listing Title: Highway Planning and Construction Federal Agency: Department of Transportation
Pass-Through Entity: State of California Department of Transaction Federal Award Identification Number: Refer to the Schedule Assistance Listing Number: 21.027
Assistance Listing Title: Coronavirus State and Local Fiscal Recovery Funds Federal Agency: Department of Treasury
Pass-Through Entity: N/A
Federal Award Identification Number: N/A
Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation):

Suspension and Debarment, Non-Federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. “Covered transactions” include those procurement contracts for goods and services awarded under a nonprocurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All nonprocurement transactions entered into by a recipient (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215.

When a non-Federal entity enters into a covered transaction with an entity at a lower tier, the non-Federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at https://www.sam.gov/portal/public/SAM/ (Note: The OMB guidance at 2 CFR part 180 and agency implementing regulations still refer to the SAM Exclusions as the Excluded Parties List System (EPLS)), (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300).

Condition:

During our audit, we noted that the City did not have documentation on verifying the vendors against the SAM to ensure that they were not suspended or debarred from federally funded purchases.

Cause:

The City does not have a process in place to require staff maintain the proof of verification performed on checking the suspension or debarment over vendors that the City makes contracts with federally-funded projects.

Attachment A 216
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
19 Section III – Federal Awards Finding and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) 2022-004 - Procurement and Suspension, and Debarment – Internal Control over Verification Against the System for Award Management (“SAM”) (Continued)
Effect or Potential Effect:

Without verifying whether vendors are suspended or debarred from working on federally-funded projects, the City could be contracting with vendors that are prohibited from working on federally-funded projects.

Questioned Costs:

None.

Context:

See condition above for the context of the finding.

Identification as a Repeat Finding, If Applicable:

Not applicable.

Recommendation:

We recommended the City establish internal control procedures to monitor compliance requirements to ensure vendors are not suspended or debarred from federally-funded purchases.

Views of Responsible Officials:

Management concurs the finding.

Attachment A 217
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
20 Section III – Federal Awards Finding and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) 2022-005 – Reporting – Internal Control and Compliance over Reporting Identification of the Federal Program:

Assistance Listing Number: 66.958
Assistance Listing Title: Water Infrastructure Finance and Innovation (WIFIA) Federal Agency: United Statements Environmental Protection Agency Pass-Through Entity: N/A
Federal Award Identification Number: N/A
Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation):

Pursuant to the WIFIA Loan Agreement between the City and the Environmental Projection Agency, Section 16.

Reporting Requirement, below reporting are required:
(a) Updating Financial Model: The City shall provide to the WIFIA Lender not later than one hundred eighty (180) days after the beginning of each City Fiscal Year, an updated Base Case Financial Model reflecting the then-current and projected conditions.
(b) Annual Financial Statements. The City shall deliver to the WIFIA Lender, as soon as available, but no later than one hundred eighty (180) days after the end of each City Fiscal Year. (c) Reserved
(d) Construction Reporting. The WIFIA Lender shall have the right in its sole discretion to monitor (or direct its agents to monitor) the development of the Project, including environmental compliance, design, and construction of the Project. The City shall be responsible for administering construction oversight of the Project in accordance with applicable federal, state and local governmental requirements. The City agrees to cooperate in good faith with the WIFIA Lender in the conduct of such monitoring by promptly providing the WIFIA Lender with such reports, documentation or other information as shall be requested by the WIFIA Lender or its agents, including any independent engineer reports, documentation or information. During the period through Substantial Completion of the Project, the City shall furnish to the WIFIA Lender, on a quarterly basis, a report on the status of the Project, substantially in the form of Exhibit K (Form of Quarterly Report). The report shall be executed by the City’s Authorized Representative and, for any quarter, shall be delivered to the WIFIA Lender within thirty (30) days following such quarter (or if such day is not a Business Day, on the next following Business Day). If the then-current projection for the Substantial Completion Date is a date later than the Projected Substantial Completion Date, the City shall provide in such report a description in reasonable detail to the reasonable satisfaction of the WIFIA Lender of the reasons for such projected delay, an estimate of the impact of such delay on the capital and operating costs of the System (if any), and that the new date could not reasonably be expected to result in a Material Adverse Effect. (e) Public Benefits Report. The City shall deliver to the WIFIA Lender a report, in the form of Exhibit L (Form of Public Benefits Report Public Benefits Report later than thirty (30) days prior to the Effective Date, (ii) within ninety (90) days following the Substantial Completion Date and (iii) within ninety (90) days following the fifth (5th) anniversary of the Substantial Completion Date. The City agrees that information described under this Section 16(e) may be made publicly available by the WIFIA Lender at its discretion.

Attachment A 218
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
21 Section III – Federal Awards Finding and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) 2022-005 – Reporting – Internal Control and Compliance over Reporting (Continued) Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation) (Continued):
(f) Modifications to Total Project Costs. For the period through the Substantial Completion Date, the City shall provide the WIFIA Lender with written notification at least thirty (30) days prior to instituting any increase or decrease to the aggregate Total Project Costs in an amount equal to or greater than five percent (5%), which notification shall set forth the nature of the proposed increase or decrease and an estimate of the impact of such increase or decrease on the capital costs and operating costs of the System. The City s notice shall demonstrate that the proposed increase or decrease is consistent with the provisions of this Agreement, is necessary or beneficial to the Project City ability to comply with its obligations under the Related Documents (including any financial ratios or covenants included therein), and could not reasonably be expected to result in a Material Adverse Effect.
(g) Operations and Maintenance. The WIFIA Lender shall have the right, in its sole discretion, to monitor (or direct its agents to monitor) the Project s operations and, as the WIFIA Lender may request from time to time, to receive reporting on the operation and management of the Project, and copies of any contracts relating to the operation and maintenance of the Project. The City agrees to cooperate in good faith with the WIFIA Lender in the conduct of such monitoring by promptly providing the WIFIA Lender with such reports, documentation, or other information requested by the WIFIA Lender. The WIFIA Lender has the right, in its sole discretion, to retain such consultants or advisors, to carry out the provisions of this Section 16(g). On or prior to the Substantial Completion Date, the City shall deliver to the WIFIA Lender an operations and maintenance manual with respect to the Project, in form and substance reasonably acceptable to the WIFIA Lender.
(h) Notices.
a. The City shall, within fifteen (15) days after the City learns of the occurrence, give the WIFIA Lender notice of any of the following events or receipt of any of the following notices, as applicable, setting forth details of such event:
i. Substantial Completion
ii. Defaults; Events of Default
iii. Litigation
iv. Delayed Governmental Approvals
v. Environmental Notices
vi. Amendments
vii. Related Document Defaults
viii. Uncontrollable Force
ix. Ratings Changes
x. 2 C.F.R. § 180.350 Notices
xi. Additional Principal Project Contracts
xii. Issuance of System Obligations
xiii. Postings on EMMA
xiv. Other Adverse Events
xv. Draws on WIFIA Reserve Account
Attachment A 219
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
22 Section III – Federal Awards Finding and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) 2022-005 – Reporting – Internal Control and Compliance over Reporting (Continued) Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation) (Continued):
(h) Notices. (Continued)
a. Within thirty (30) calendar days after the City learns of the occurrence of an event specified in clause (i) above (other than sub-clauses (A) (Substantial Completion), (F) (Amendments) or (I) (Ratings Changes) (in the case of a ratings upgrade)), the City s Authorized Representative shall provide a statement to the WIFIA Lender setting forth the actions the City proposes to take with respect thereto.

The City shall also provide the WIFIA Lender with any further information reasonably requested by the WIFIA Lender from time to time concerning the matters described in clause (i) above. (i) Requested Information. The City shall, at any time while the WIFIA Loan remains outstanding, promptly deliver to the WIFIA Lender such additional information regarding the business, financial, legal or organizational affairs of the City or regarding the Project or the System Revenues as the WIFIA Lender may from time to time reasonably request.

Condition:

During the audit, we noted that the City was not aware of the reporting requirements from the loan agreements and only filed the Construction Reporting.

Cause:

The City was not familiar with the loan agreement reporting requirements.

Effect or Potential Effect:

Without filing all the required reports by the loan agreement resulted in noncompliance.

Questioned Costs:

None.

Context:

See condition above for the context of the finding.

Identification as a Repeat Finding, If Applicable:

Not applicable.

Recommendation:

We recommended the City establish internal control procedures to monitor compliance requirements to make sure the required reports are filed properly and timely.

Attachment A 220
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
23 Section III – Federal Awards Finding and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) 2022-005 – Reporting – Internal Control and Compliance over Reporting (Continued) Views of Responsible Officials:

Management concurs the finding.

Attachment A 221
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
24 Section III – Federal Awards Finding and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) 2022-006 – Special Tests and Provisions – Internal Control and Compliance over Obligation, Expenditure, Payment Requirements
Identification of the Federal Program:

Assistance Listing Number: 14.231
Assistance Listing Title: Emergency Solutions Grant Program Federal Agency: U.S. Department of Housing and Urban Development Pass-Through Entity: N/A
Federal Award Identification Number: E-20-MC-06-0026, E-21-MC-06-0026, E-20-MW-06-0026 Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation):

Pursuant to April 2022 Compliance Supplement, Special Tests and Provisions – Obligation, Expenditures and Payment Requirements –
Obligation-ESG. Funds allocated to metropolitan cities, urban counties, and territories. Within 180 days after the date that HUD signs the grant agreement (or a grant amendment for reallocation of funds) with a metropolitan city, urban county, or territory, the recipient must obligate all of the grant amount, except the amount for its administrative costs.

ESG-CV funds must be obligated by the recipient in accordance with 24 CFR 576.203(a)(1) and (2), except as provided below. The applicable period for obligating ESG-CV funds begins on the date HUD signed the recipient’s grant agreement for the first allocation of ESG-CV funds. The obligation deadlines below apply to the both the first and second allocation of ESG-CV funds. HUD is also providing further flexibility for recipients (including states and non-states) to provide additional time to identify entities that have capacity and expertise to mitigate the impacts of coronavirus, including those who have not previously or recently received ESG funding. a. Recipients that are metropolitan cities, urban counties, or territories may have up to 240 days from the date HUD signs the grant agreement to obligate ESG-CV funds. Recipients must maintain in their program records a description of any changes the recipient implemented to identify and select new subrecipients.

Payments to Subrecipients. The recipient must pay each subrecipient for allowable costs within 30 days after receiving the subrecipient’s complete payment request. This requirement also applies to each subrecipient that is a unit of general-purpose local government (24 CFR section 576.203).

Condition:

During our audit, we noted two out of nine samples selected for obligation testing were outside of the obligation without further justifications.

In addition, we noted three out of forty samples selected for payment requirements testing were outside of 30 days window without further justifications.

Attachment A 222
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
25 Section III – Federal Awards Finding and Questioned Costs (Continued) A. Current Year Findings and Questioned Costs – Major Federal Award Program Audit (Continued) 2022-006 – Special Tests and Provisions – Internal Control and Compliance over Obligation, Expenditure, Payment Requirements (Continued)
Cause:

The City does not have formal policies and procedures in place to obligate the funds within the required timeframe nor complete the subrecipient’s payment request within 30 days. In addition, the City did not have procedures in place to timely request grantor extensions and/or document exceptions that are outside of uniform guidance.

Effect or Potential Effect:

The exceptions noted resulted in noncompliance.

Questioned Costs:

None.

Context:

See condition above for the context of the finding.

Identification as a Repeat Finding, If Applicable:

Not applicable.

Recommendation:

We recommended the City establish internal control procedures to monitor compliance requirements to ensure the subrecipient’s payment requests are processed timely.

Views of Responsible Officials:

Management concurs the finding.

Attachment A 223
City of Stockton
Schedule of Findings and Questioned Costs (Continued)
For the Year Ended June 30, 2022
26 Section III – Federal Awards Finding and Questioned Costs (Continued) B. Prior Year Findings and Questioned Costs – Major Federal Award Program Audit No prior year findings were noted.

Attachment A 224
City of Stockton
Legislation Text
File #: 23-0499, Version: 1

APPROVAL OF CITY COUNCIL MINUTES

RECOMMENDATION
Approve the minutes from the City Council meetings of March 7, 2023, and March 28, 2023, and April 4, 2023
Attachment A - 2023-03-07 Minutes
Attachment B - 2023-03-28 Minutes
Attachment C - 2023-04-04 Minutes
City of Stockton Page 1 of 1 Printed on 5/16/2023
powered by Legistar™
225
Attachment A 226
Attachment A 227
Attachment A 228
Attachment A 229
Attachment A 230
Attachment A 231
Attachment A 232
Attachment A 233
Attachment A 234
Attachment A 235
Attachment B 236
Attachment C 237
Attachment C 238
Attachment C 239
Attachment C 240
Attachment C 241
Attachment C 242
Attachment C 243
Attachment C 244
Attachment C 245
Attachment C 246
Attachment C 247
City of Stockton
Legislation Text
File #: 23-0467, Version: 1

ADOPT A RESOLUTION IDENTIFYING TERMS AND CONDITIONS FOR FIRE DEPARTMENT

ADMINISTRATIVE SUPPRESSION PERSONNEL COMPENSATION FOR PROVIDING

RESPONSE TO THE CALIFORNIA OFFICE OF EMERGENCY SERVICES INCIDENTS AWAY

FROM THEIR OFFICIAL DUTY STATION OUTSIDE OF THE CITY OF STOCKTON

RECOMMENDATION
It is recommended that the City Council approve and adopt a resolution to add Administrative Fire Battalion Chief, Administrative Fire Captain, Administrative Fire Fighter Engineer, and Administrative Fire Fighter to the current list of approved Fire Department personnel classification titles assigned to mutual aid incident response to the California Office of Emergency Services away from the official duty station outside the City of Stockton and San Joaquin County.

Summary
The City of Stockton Fire Department adheres to the California Fire Assistance Agreement (CFAA) for reimbursement of out-of-county mutual aid responses. The Fire Department is reimbursed entirely by the State of California for responding to requests for mutual aid throughout California. The current CFAA establishes the requirements to ensure adequate reimbursement for mutual aid responses. Adoption of this resolution is necessary to maintain compliance with the CFAA and to ensure that the City receives compensation for actual hours worked from the time of departure, through time returned to their officially assigned duty station for suppression personnel assigned to administrative duties who provide mutual aid to the State. The elected bodies of all California fire agencies that participate in out-of-county mutual aid are compelled to adopt resolutions in order to ensure proper payment.

DISCUSSION
Background
The State of California Office of Emergency Services (OES) serves as the broker between local government fire departments and the requesting State and Federal agencies for mutual aid responses. Financial reimbursement for the local government fire department’s mutual aid responses is set forth in the 2020 CFAA. The CFAA requires participating fire departments to have a Memorandum of Understanding (MOU) on file internally that describes the wages and benefits of all employee classifications that will respond to a mutual aid incident. The City of Stockton Fire Department has an MOU on file for its respective labor groups.

Additionally, the Agency is required to have a resolution on file that states that Fire Department personnel are paid for all hours, commonly referred to as portal-to-portal, and that our reimbursement procedures are in accordance with the CFAA. Resolution 2015-05-19-1213 was passed, approved, City of Stockton Page 1 of 2 Printed on 5/16/2023
powered by Legistar™
248
File #: 23-0467, Version: 1
and adopted on May 19, 2015 to address portal-to-portal reimbursements. Adoption of this resolution will ensure our ability to recover costs for administrative suppression salaries related to mutual aid responses.

Present Situation
The State of California Fire Department, known as Cal Fire, and the United States Forest Service, depend on local government resources to assist with large-scale wildland fires. Additionally, as California’s growing population expands into the wildland areas, urban interface fire activity is expected to increase in frequency and severity.

The City of Stockton Fire Department is a signatory contractor for OES. OES has assigned a Fire Engine and a medium rated Urban Search and Rescue trailer to the City in the event of a major incident, that overwhelms local resources. City of Stockton Fire Department personnel are trained to respond to these types of emergencies, statewide. OES allows the Fire Department to utilize this equipment within the City when conducting drills, or during an emergency, both of which are great resources and provide an additional service to our community.

The Stockton Fire Department is compensated for OES responses away from our normal duty station, from the time of departure, until our arrival back at our regularly assigned duty station. This practice is known as portal-to-portal compensation. This entire cost is reimbursed by OES under the CFAA. The incorporation of the administrative classifications into the list of approved Fire Department personnel classification titles will ensure the City is appropriately reimbursed for all costs incurred for participating in a mutual aid response.

The passage of the proposed resolution provides the required documentation by the CFAA to ensure the City of Stockton Fire Department is properly reimbursed portal-to-portal for administrative suppression personnel.

FINANCIAL SUMMARY
This resolution, if approved and adopted, will satisfy the terms and conditions of the 2020 California Fire Assistance Agreement (CFAA) for the addition of the Administrative Fire Battalion Chief, Administrative Fire Captain, Administrative Fire Fighter Engineer, and Administrative Fire Fighter classifications. Compensation associated to the CFAA for out-of-county mutual aid responses are credited to State Reimbursements account 4020-000-430102/430202-100-000-20-40-000-000-.

City of Stockton Page 2 of 2 Printed on 5/16/2023
powered by Legistar™
249
Resolution No.

STOCKTON CITY COUNCIL

RESOLUTION IDENTIFYING TERMS AND CONDITIONS FOR FIRE DEPARTMENT

ADMINISTRATIVE SUPPRESSION PERSONNEL COMPENSATION FOR PROVIDING

RESPONSE TO THE CALIFORNIA OFFICE OF EMERGENCY SERVICES (OES)

INCIDENTS AWAY FROM THEIR OFFICIAL DUTY STATION OUTSIDE OF THE CITY

OF STOCKTON
The City of Stockton Fire Department is a public agency located in the County of San Joaquin, State of California; and
Council Resolution No. 2015-05-19-1213 was passed, approved, and adopted on May 19, 2015 to address portal-to-portal reimbursements for Fire Department response personnel which include: Fire Chief, Deputy Fire Chief, Division Chief, Battalion Chief, Fire Captain, Firefighter Engineer and Firefighter; and The City of Stockton has in its employ, Fire Department response personnel which also include: Administrative Fire Battalion Chief, Administrative Fire Captain, Administrative Fire Fighter Engineer, and Administrative Fire Fighter; and The City of Stockton will compensate its response personnel portal-to-portal while in the course of their employment and away from their official duty station and assigned to an emergency incident, in support of an emergency incident, or pre-positioned for emergency response; and
The City of Stockton will compensate its response personnel overtime in accordance with their current Job Classification while in the course of their employment and away from their official duty station and assigned to an emergency incident, in support of an emergency incident, or pre-positioned for emergency response; now, therefore,

BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF STOCKTON, AS FOLLOWS:

1. Fire Department response personnel currently assigned to an administrative job classification shall be compensated according to the City of Stockton Salary Schedule and Fire Management Unit Memorandum of Understanding MOU (section 13.10) and Fire Unit MOU (section 13.14), Personnel Rules and Regulations, and/or directive that identifies personnel compensation in the workplace.

2. In the event a personnel classification does not have an assigned compensation rate, a "Base Rate" as set forth in an organizational policy, administrative directive, or similar document will be used to compensate such personnel.

3. The City of Stockton Fire Department will maintain a current salary survey or acknowledgment of acceptance of the "Base Rate" on file with the California Governor's Office of Emergency Services, Fire Rescue Division. 250

4. Fire Department response personnel will be compensated (portal-to-portal) beginning at the time of dispatch to the return to jurisdiction when equipment and personnel are in service and available for agency response.

5. Fire Department response personnel include: Administrative Fire Battalion Chief, Administrative Fire Captain, Administrative Fire Fighter Engineer, and Administrative Fire Fighter.

6. The City Manager is hereby authorized to take all necessary and appropriate actions to carry out the purpose and intent of this Resolution.

PASSED, APPROVED, and ADOPTED May 23, 2023 .

KEVIN J. LINCOLN II
Mayor of the City of Stockton
ATTEST:

ELIZA R. GARZA, CMC
City Clerk of the City of Stockton
251
City of Stockton
Legislation Text
File #: 23-0391, Version: 1

AWARD A CONSTRUCTION CONTRACT TO INSITUFORM TECHNOLOGIES, LLC FOR THE

BROOKSIDE NORTH STORM PUMP STATION DISCHARGE PIPES REHABILITATION AND AMEND FISCAL YEAR 2022-23 ANNUAL BUDGET

RECOMMENDATION
It is recommended that the City Council adopt a resolution to:

2. Approve the project Plans and Specifications for the Brookside North Storm Pump Station Discharge Pipes Rehabilitation, Project No. US20028 (Exhibit 2 to the Resolution).

3. Award a construction contract of $173,702 to Insituform Technologies, LLC, of Chesterfield, MO, for the Brookside North Storm Pump Station Discharge Pipes Rehabilitation, Project No.

US20028 (Exhibit 3 to the Resolution).

It is also recommended that the City Manager be authorized to take appropriate and necessary actions to carry out the purpose and intent of this resolution.

Summary
The Municipal Utilities Department (MUD) operates the Brookside North Storm Pump Station located at 6373 Brook Hollow Circle. The pump station collects stormwater from the north Brookside neighborhood and discharges the water through the levee into 14-Mile Slough with four (4) 24-inch and one (1) 14-inch steel pipelines. The MUD is responsible for stormwater station service and repairs while Reclamation District 2074 is responsible for monitoring and maintaining the Brookside levee. An inspection following the recent winter storms found water leaking from cracks in three (3) of the stormwater discharge pipes.

This action will provide project funding to Insituform Technologies, LLC of Chesterfield, MO to repair the damaged stormwater discharge pipes at the Brookside North Storm Pump Station with a cured-in -place-pipe (CIPP) lining.

If approved, this action will authorize the award of a construction contract in the amount of $173,702 to Insituform Technologies, LLC.

City of Stockton Page 1 of 3 Printed on 5/16/2023
powered by Legistar™
252
File #: 23-0391, Version: 1

DISCUSSION
Background
An inspection revealed cracks in three storm pump station discharge pipes between the pumps and the landside slope of the Brookside levee. The project will repair the pipeline cracks with the installation of CIPP in the lengths of two 24-inch and one 14-inch discharge pipes. The use of CIPP is a common method of trenchless rehabilitation and restoration used to repair pipelines throughout the US. The process will consist of inserting a resin-impregnated flexible tube through the damaged pipe, then inflating the tube to the inside diameter of the pipe using water or air and curing the tube using hot water or steam. During the curing period, the heat activates the resin causing it to harden, creating a newly fitted pipe wall within the original pipe that will last many years. The successful use of trenchless repair will reduce project costs and the complexity of levee excavation, damaged pipe removal and re-installing a new pipe section and levee.

Present Situation
On March 2, 2023, the MUD advertised the project in the Stockton Record and posted it to the City’s Bid Flash webpage. Additionally, 3,567 notifications were sent through Ask Stockton.

A non-mandatory pre-bid conference meeting was held on March 16, 2023, with two (2) prospective bidders in attendance. A field visit was conducted after the pre-bid conference. On Thursday, March 30, 2023, two (2) sealed bids were received and publicly opened by the City Clerk with the following results:

COMPANY NAME LOCATION BID PRICE
Insituform Technologies, LLC Chesterfield, MO $173,702
Nor-Cal Pipeline Services Roseville, CA $265,635
Engineer’s Estimate $175,500
The bid received by the apparent low bidder, Insituform Technologies, LLC is regular in all aspects and compliant with the project specifications.

It is recommended that the City Council award a Construction Contract in the amount of $173,702 to Insituform Technologies, LLC for the Brookside North Storm Pump Station Discharge Pipes Rehabilitation, Project No. US20028.

Local Employment Ordinance
The contract amount is over $100,000 and subject to the Local Employment Ordinance, which requires that “all City contracts for public works or improvements of the estimated value or City subsidy of $100,000 or more shall contain provisions pursuant to which the contractor promises to make a good faith effort, with the assistance of local labor union hiring halls or community organizations designated by the City to employ qualified individuals who are, and have been for one year prior to the effective date of the contract, residents of Stockton in sufficient numbers so that no City of Stockton Page 2 of 3 Printed on 5/16/2023
powered by Legistar™
253
File #: 23-0391, Version: 1
less than 50 percent of the contractor’s total construction workforce, including any subcontractor workforce, measured in labor work hours, is comprised of Stockton residents.” The Local Preference Ordinance, which states that “preference shall be given to the purchase of supplies, materials, equipment, and contractual services from local merchants, quality and price being equal,” does not apply to the project because none of the bidders is located within the limits of City of Stockton or San Joaquin County.

The project is under $1,000,000 and not subject to the Community Workforce and Training Agreement.

Environmental Clearance
It has been determined that this project is categorically exempt from the requirements of the California Environmental Quality Act (CEQA) guidelines as specified under Article 19, Section 15302, Class 2 (c) of the CEQA guidelines because it concerns the replacement or reconstruction of an existing public facility where the new structure will be located on the same site as the structure replaced. The project will have substantially the same purpose and capacity as the structure replaced.

In addition, the proposed project is consistent with the Envision Stockton 2040 General Plan, Land Use Policy 6.3. It improves existing utility services to ensure that all neighborhoods have access to well-maintained public facilities and utilities that meet community service needs.

FINANCIAL SUMMARY
Funds will be reappropriated in FY 2022-23 from the completed Storm Drain Pump Stations and Forcemains Cathodic Protection Repairs Project (US16010) account to the Brookside North Storm Pump Station Discharge Pipe Rehabilitation Project (US20028) account.

There is no impact on the City’s General Fund or any other unrestricted fund as a result of taking the recommended action.

City of Stockton Page 3 of 3 Printed on 5/16/2023
powered by Legistar™
254
Resolution No.

STOCKTON CITY COUNCIL
RESOLUTION APPROVING THE FILING OF A NOTICE OF EXEMPTION NO. NOE 7- 23, APPROVING THE PROJECT PLANS AND SPECIFICATIONS, AND AWARDING A CONSTRUCTION CONTRACT IN THE AMOUNT OF $173,702 TO INSITUFORM TECHNOLOGIES, LLC; AND AUTHORIZING A REAPPROPRIATION OF $105,000 FROM EXISTING CAPITAL PROJECT US16010 TO THE BROOKSIDE NORTH

STORM PUMP STATION DISCHARGE PIPES REHABILITATION
(PROJECT NO. US20028)
On March 30, 2023, the City Clerk of the City of Stockton opened, examined, and publicly declared the sealed bids offered for the Brookside North Storm Pump Station Discharge Pipes Rehabilitation (Project No. US20028); and Insituform Technologies, LLC is the apparent low bidder in the amount of $173,702; and
The bid submitted by Insituform Technologies, LLC is regular and responsive in all aspects; and
The project conforms with the City’s General Plan and is exempt from the requirements of the California Environmental Quality Act (CEQA) as specified under Article 19, Section(s) 15302, Class 2 (c), of the CEQA Guidelines; The project also conforms with the Stockton General Plan based on Policy Land Use – 6.3; now, therefore,

BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF STOCKTON, AS FOLLOWS:

1. Approve the filing of the Notice of Exemption No. NOE 7-23 under CEQA for the Brookside North Storm Pump Station Discharge Pipes Rehabilitation (Project No. US20028), a copy of which is attached as Exhibit 1 and incorporated by this reference.

2. The City Council approves the project Plans and Specifications for the Brookside North Storm Pump Station Discharge Pipes Rehabilitation (Project No.

US20028), a copy of which is attached as Exhibit 2 and incorporated by this reference.

3. The City Council authorizes the City Manager to execute a construction contract with Insituform Technologies, LLC of Chesterfield, MO, in the amount of $173,702 for the Brookside North Storm Pump Station Discharge Pipes Rehabilitation (Project No. US20028), a copy of which is attached as Exhibit 3 and incorporated by this reference.
255

4. The City Council authorizes the City Manager to reappropriate funds in the amount of $105,000 from existing capital project US16010 to the Brookside North Storm Pump Station Discharge Pipes Rehabilitation (Project No. US20028).

5. The City Manager or his designee is authorized and directed to execute all documents, including but not limited to, agreements and amendments.

6. The City Manager is hereby authorized to take appropriate and necessary actions to carry out the purpose and intent of this Resolution.

PASSED, APPROVED, and ADOPTED May 23, 2023 .

KEVIN J. LINCOLN II
Mayor of the City of Stockton\
ATTEST:

ELIZA R. GARZA, CMC
City Clerk of the City of Stockton
256
257
PLAN HOLDER NO. _______

CITY OF STOCKTON

MUNICIPAL UTILITIES DEPARTMENT

NOTICE TO BIDDERS

INSTRUCTIONS TO BIDDERS
BID

CONTRACT

SPECIAL PROVISIONS

FOR CONSTRUCTION OF

BROOKSIDE NORTH STORM PUMP

STATION DISCHARGE PIPES

REHABILITATION
PROJECT NO. US20028
CONTRACTOR MUST HAVE A CLASS "A" LICENSE

STOCKTON, CALIFORNIA
Bid Opens: THURSDAY, MARCH 30, 2023, 2:00 p.m.

FOR INFORMATION

REGARDING THIS PROJECT CALL
(209) 937-8700 or (209) 937-8727 Extension
(Do not return - Please recycle)
EXHIBIT 2 258
EXHIBIT 2 259
EXHIBIT 2 260
EXHIBIT 2 261
Table of Contents
00010-1
SECTION 00010 - TABLE OF CONTENTS
DIVISION 0 - BIDDING AND CONTRACT REQUIREMENTS
Section
00010 Table of Contents
00020 Notice Inviting Bids
00100 Instructions to Bidders

1.0 Work to be Done

2.0 Examination of Contract Documents

3.0 Inspection of Site

3.1 Pre-bid Conference

4.0 Interpretation of Contract Documents

5.0 Postponement of Opening

6.0 Opening of Bids

7.0 Preparation of Bid Forms

8.0 Bidder’s Signature and Authority

9.0 Erasures and Corrections

10.0 Bid Irregularities

11.0 Modification of Bid

12.0 Withdrawal of Bids

13.0 Addenda

14.0 Bid Prices

15.0 Bid Guaranty

16.0 Qualification of Bidder

17.0 Subcontractors

18.0 Major Equipment Items

19.0 Substitutions During Bidding

20.0 Bidders Interested in More Than One Bid
EXHIBIT 2 262
Table of Contents
00010-2

21.0 Sheeting, Shoring, and Bracing

22.0 Wage Rates

23.0 Offer of Assignment of Antitrust Actions

24.0 Assignment of Contract

25.0 Rejection of Bids

26.0 Contract and Bonds

27.0 Award of Contract

28.0 Execution of Contract

29.0 Business License

30.0 Construction and Demolition Debris

31.0 NOT USED

32.0 Bid Protests

33.0 Local Employment

34.0 Community Workforce and Training Agreement
00220 Geotechnical Data

BIDDING REQUIREMENTS
00300 List of Bid Items
00500 Construction Contract
00700 General Conditions

1.0 GENERAL

1.1 Intent of Contract Documents

1.2 Discrepancies and Omissions

1.3 Headings

1.4 Penalty for Collusion

1.5 Successors and Assigns

1.6 Assignment to City

1.7 Rights and Remedies

2.0 ADMINISTRATION

2.1 Administration of the Contract

2.2 City's Representative

2.3 Construction Management

2.4 Design Consultant
EXHIBIT 2 263
Table of Contents
00010-3

3.0 CITY

3.1 General

3.2 Attention to Work

3.3 Inspection

3.4 City's Right to Carry Out the Work

3.5 City's Right to Use or Occupy

3.6 City's Right to Perform Work and to Award Separate Contracts

4.0 CONTRACTOR

4.1 Office

4.2 Contractor's Representative

4.3 Construction Procedures

4.4 Contractor's Employees

4.5 Subcontractors

4.6 Contractor's Equipment and Facilities

4.7 Public Safety and Convenience

4.8 City-Contractor Coordination

4.9 Permits

4.10 Contractor's Responsibility for the Work and Materials

4.11 Laws to be Observed

4.12 Safety

5.0 CONTROL OF WORK AND MATERIALS

5.1 Means and Methods

5.2 City Furnished Materials

5.3 Defective and Unauthorized Work

5.4 Unnoticed Defects

5.5 Right to Retain Imperfect Work

6.0 PROGRESS OF THE WORK

6.1 Beginning of Work

6.2 Time of Completion

6.3 Delays

6.4 Time Extensions

6.5 Liquidated Damages

6.6 Termination By City for Cause

6.7 Suspension By The City For Convenience

6.8 Termination By City for Convenience

6.9 Temporary Suspension of Work

7.0 SCOPE OF WORK - CHANGES IN THE WORK

7.1 Changes

7.2 Change Orders

7.3 Differing Site Conditions

7.4 Value Engineering Change Proposals (VECP)

7.5 Resolution of Disputes

7.6 Assertion of Claims

7.7 Dispute Resolution

8.0 PAYMENT

8.1 Scope of Payment

8.2 Partial Payments

8.3 Partial Payments - Inclusion of Materials on Hand

8.4 Right to Withhold Amounts
EXHIBIT 2 264
Table of Contents
00010-4

8.5 Substantial Completion

8.6 Final Inspection and Payment

8.7 Warranty of Title

9.0 EXISTING UTILITIES

9.1 General

9.2 Notification and Location

9.3 Damage and Protection

9.4 Utility Relocation and Rearrangement

10.0 APPLICABLE LAW/CODE REQUIREMENTS

11.0 USE OF SITE AND CLEAN UP

12.0 CORRECTION OF DEFFECTIVE WORK AND GUARANTEE TO REPAIR PERIOD
00800 Supplementary Conditions

1.0 LOCAL EMPLOYMENT

2.0 COMMUNITY WORKFORCE AND TRAINING AGREEMENT
00810 Modifications to General Conditions
00820 Liability and Insurance Requirements

1.0 INDEMNIFICATION

2.0 INSURANCE REQUIRMENTS
DIVISION 1 - GENERAL REQUIREMENTS
01010 Summary of Work

1.0 WORK COVERED BY CONTRACT DOCUMENTS

2.0 CONTRACT ADMINISTRATION

2.1 Name of Construction Manager

2.2 Name of Design Consultant

2.3 Name of City's Representative

3.0 TIME ALLOWED FOR COMPLETION

4.0 DAMAGES FOR DELAYS

5.0 WEATHER DAYS

6.0 WORK SEQUENCE AND CONSTRAINTS

7.0 OCCUPANCY REQUIREMENTS

8.0 CITY FURNISHED MATERIALS

8.1 Contract Documents
EXHIBIT 2 265
Table of Contents
00010-5

9.0 TRENCH EXCAVATION

10.0 WORK UNDER OTHER CONTRACTS

11.0 CONTRACTOR'S WORK PERCENTAGE

12.0 UNDERGROUND FACILITIES

13.0 LEGAL AND CITY HOLIDAYS
01015 General Provisions

1.0 GENERAL

1.1 Description

1.2 Guarantee

1.3 Contractors License

1.4 Patents

2.0 PRODUCTS (Not applicable in this Section)

3.0 EXECUTION

3.1 Public Complaints

3.2 Guarantees and Warranties

3.3 Precedence of Contract Documents

3.4 Care and Protection of Property

3.5 Field Check of Existing Improvements

3.6 Protection of Existing Improvements

3.7 Cooperation With Others

3.8 Unfavorable or Hazardous Construction Conditions

3.9 Testing and Substantial and Final Completion
01025 Measurement and Payment

1.0 GENERAL

1.1 Measurement of Quantities

1.2 Units of Measurement

1.3 Certified Weights

1.4 Methods of Measurement

2.0 DESCRIPTION OF BID ITEMS

2.1. General

2.2 Duration of Prices

2.3 Bid Items

2.4 Payment for Mobilization

2.5 Payment for Startup and Demobilization

3.0 CONTRACTOR'S COST BREAKDOWN
01035 Modification Procedures
EXHIBIT 2 266
Table of Contents
00010-6

1.0 CHANGES IN CONTRACT PRICE

2.0 NEGOTIATED CHANGE ORDERS

3.0 FORCE ACCOUNT PAYMENT

4.0 UNIT PRICE ADJUSTMENTS DUE TO INCREASED OR DECREASED

QUANTITIES

5.0 TIME EXTENSIONS FOR CHANGE ORDERS

6.0 CONTRACTOR CHANGE REQUESTS

7.0 VALUE ENGINEERING COST PROPOSALS
01040 Coordination

1.0 GENERAL

2.0 COOPERATION WITH OTHERS

3.0 ORGANIZATION AND COORDINATION

3.1 Monthly Reports

3.2 Daily Reports

3.3 Correspondence

4.0 SYSTEM OUTAGE REQUESTS

5.0 SEQUENCING OF THE WORK

6.0 ACCESS TO PROJECT FACILITIES
01050 Field Engineering

1.0 CHECK OF EXISTING IMPROVEMENTS

2.0 DATUM

3.0 LINES AND GRADES
01060 Regulatory Requirements

1.0 APPLICABLE CODES

1.1 Laws and Regulations

1.2 Codes

1.3 Specifications

2.0 LICENSES, FEES, AND PERMITS

2.1 Contractor’s License

2.2 Business License

2.3 Encroachment Permit (City of Stockton)
01090 References
EXHIBIT 2 267
Table of Contents
00010-7

1.0 DEFINITIONS

2.0 ABBREVIATIONS
01200 Project Meetings

1.0 PRE-CONSTRUCTION CONFERENCE

1.1 Attendees

1.2 Agenda

1.3 Minutes

2.0 PROGRESS MEETINGS

2.1 Schedule

2.2 Attendees

2.3 Agenda

2.4 Minutes

3.0 CONFERENCES

4.0 POST CONSTRUCTION MEETING
01300 Submittals

1.0 DESCRIPTION

2.0 SUBMITTAL-GENERAL REQUIREMENTS

3.0 SCHEDULE OF VALUES

4.0 PROGRESS SCHEDULE

5.0 SHOP DRAWINGS

6.0 SAMPLES

7.0 MATERIALS LISTS AND EQUIPMENT DATA

8.0 INSTRUCTION MANUALS

9.0 INSTALLATION INSTRUCTIONS

10.0 CITY PERSONNEL TRAINING PLAN

11.0 OTHER SUBMITTALS

12.0 STORAGE INSTRUCTIONS

13.0 TOOLS, ACCESSORIES, SPARE PARTS, AND MAINTENANCE MATERIALS

14.0 RECORD DRAWINGS AND SPECIFICATIONS

15.0 REVISION OF SUBMITTALS

16.0 CERTIFICATES
EXHIBIT 2 268
Table of Contents
00010-8

17.0 EARTHQUAKE DESIGN AND RESTRAINT

18.0 CONSTRUCTION PHOTOGRAPHS

18.1 Summary

18.2 Submittals

18.3 Media

18.4 General
01310 Progress Schedule

1.0 CONSTRUCTION SCHEDULE

1.1 Base Schedule

1.2 Responsible Person

1.3 Reports

2.0 WEATHER CONDITIONS

3.0 UPDATES

3.1 Submittal Period

3.2 Schedule Review

3.3 Schedule Revisions

4.0 TIME IMPACT ANALYSES

4.1 Requirement

4.2 Delays

4.3 Submittal

5.0 WEEKLY ACTIVITIES PLAN

6.0 CASH FLOW PROJECTION

7.0 WORKHOUR PROJECTION
01400 Quality Control

1.0 QUALITY CONTROL

2.0 INSPECTION

3.0 SAMPLES AND TESTS

3.1 Sampling

3.2 Testing

3.3 Test Standards
01500 Construction Facilities and Temporary Controls

1.0 GENERAL

2.0 TEMPORARY UTILITIES
EXHIBIT 2 269
Table of Contents
00010-9

2.1 Electrical Service

2.2 Water

2.3 Temporary Lightning

2.4 Heating and Ventilation

2.5 Sanitary Conveniences

3.0 CONSTRUCTION FACILITIES

3.1 Staging and False Work

3.2 Temporary Enclosures

3.3 Warning Devices and Barricades

3.4 Above Grade Protection

3.5 Use of Explosives

4.0 PROTECTION AND RESTORATION OF PROPERTY

5.0 PROJECT SECURITY

5.1 Fire Extinguisher

5.2 First Aid

5.3 Temporary Fences

6.0 ACCESS ROADS

7.0 SPECIAL CONTROLS

7.1 Dust Control

7.2 Mud Control

7.3 Noise Abatement

7.4 Working Hours

7.5 Drainage Control

7.6 Construction Cleaning

7.7 Dispose of Material

7.8 Parking and Storage Areas

8.0 TRAFFIC REGULATION

8.1 General

8.2 Haul Routes

8.3 Traffic Control

9.0 PROJECT OFFICE

10.0 CONTRACTOR’S SAFETY RULES
01600 Material and Equipment

1.0 STORAGE OF MATERIALS

2.0 HAZARDOUS MATERIALS

3.0 MATERIAL AND EQUIPMENT SUBSTITUTIONS

3.1 General

3.2 Substitutions

3.3 Modifications and Costs
01660 System Testing
EXHIBIT 2 270
Table of Contents
00010-10
01670 Training

1.0 GENERAL

2.0 INSTRUCTIONS

3.0 SCHEDULING

4.0 INSTRUCTION PROGRAM

5.0 LOCATION

6.0 RECORD OF TRAINING SESSIONS
01700 Contract Closeout

1.0 INSTRUCTION MANUALS

2.0 EQUIPMENT START-UP

3.0 FINAL CLEANING

3.1 Final Clean-up

3.2 Final Building Clean-up

4.0 PROJECT COMPLETION

4.1 Substantial Completion

4.2 Final Completion

4.3 Project Record Documents

5.0 GUARANTEE

TECHNICAL SPECIFICATIONS

GENERAL PREVAILING WAGES
EXHIBIT 2 271
Table of Contents
00010-11
EXHIBIT 2 272
Notice Inviting Bids
00020-1
SECTION 00020 - NOTICE INVITING BIDS
NOTICE IS HEREBY GIVEN that sealed bids are invited by the City of Stockton, California to provide all labor, materials, equipment, and perform all work necessary for the construction of the BROOKSIDE NORTH STORM PUMP STATION DISCHARGE PIPES REHABILITATION and in accordance with the plans and specifications for Project Number US20028.

The work includes: provision of labor, equipment, material, and all necessary work to install approximately two (2) 120' of 24" and one (1) 120' of 14" Cured In Place Pipe (CIPP) as shown on plans and described in specifications.

The work shall be performed in accordance with the intent of the Contract Documents, including as stated in the Contract and the Technical and Special Provisions, excluding only the work indicated or specified to be provided by the City or others under separate contract or other arrangement. In the event of a conflict between the Project Specifications and the City of Stockton Standard Specifications and Plans, the Project Specifications shall take precedence.

The project specifications and plans can be downloaded from the City of Stockton’s website at http://www.stocktongov.com/services/business/bidflash/mud.html?dept=Municipal_Utilities; however, official bid documents including plans, specifications, and a plan holder number, must be obtained from ARC Document Solutions in order to bid this project. The completed official sealed bid packet, including the plan holder number, must be delivered to the Office of the City Clerk, City Hall, 425 North El Dorado Street, Stockton, California 95202, up to, but not later than 2:00 p.m., on Thursday, March 30, 2023.

A non-mandatory pre-bid conference will be held at 10:00 a.m., Thursday, March 16, 2023 at the City of Stockton, Department of Municipal Utilities Storm Pump Station, 6373 Brook Hollow Circle, California 95219.

Prospective bidders shall monitor City’s website/bid flash for any project addenda or updates.

As prescribed in the Instructions to Bidders for this project, a bid guaranty in an amount not less than ten percent [10%] of the total base bid price, plus additives, if any, and conforming to the prescribed bidding procedures is required to be submitted with each bid, as a guaranty to be forfeited should the bidder, if awarded the Contract, fail to enter into the same, or fails to furnish in a timely manner the bonds and/or proof of insurance. Each bid shall also be accompanied by the Non-Collusion Declaration, and all of the other required documents and information furnished in the official bidding documents. Each bid shall be enclosed in a sealed envelope clearly marked "BID" and shall indicate the project name, project number, bid opening date, and contractor's name and address. Bidders and the public are invited to be present at the public opening and declaration of said bids. Official bid documents received after the designated time will not be accepted. No bidder may withdraw its bid for a period of sixty (60) days after the date set for the opening of bids.

The project is to be substantially completed within ninety (90) consecutive calendar days from the date specified in the Notice to Proceed, and final completion will be achieved thirty (30) consecutive calendar days thereafter. Time for commencement and completion of the work is consequential, and time is to be of the essence of the Contract.

All bidders shall be licensed under the provisions of Chapter 9, Division 3 of the Business and Professions Code of the State of California. The Contractor shall possess a valid Class "A" license at the time the bid is submitted and retain the license through the duration of the project. Failure to possess the specified license shall render the bid as non-responsive. The successful Contractor shall obtain a City of Stockton business license prior to contract execution and retain the license through the duration of the project.

All bidders must comply with the State of California Contractor Registration Requirements, which states all Contractors or subcontractors shall not be qualified to bid on, be listed in a bid proposal, subject to the requirements of Section 4104 of the Public Contract code, or engage in the performance of any contract for public work, as defined in the this chapter, unless currently registered and qualified to perform public work pursuant to Labor Code Section 1725.5.

In compliance with Senate Bill 854 and the California Labor Code, all bidders shall include with their bid proof of registration from the Department of Industrial Relations that includes the contractor’s legal name, registration number, license type/number, registration date and expiration date, for every contractor and subcontractor, regardless of tier. Submittal of subcontractor’s registration information regardless of tier is due no later than four business days after bid opening.

EXHIBIT 2 273
Notice Inviting Bids
00020-2
The general prevailing rate of wages for each craft or type of worker or mechanic needed to perform the Contract is on file with the City of Stockton. Bidders are hereby notified that the successful bidder and any subcontractor under that contract shall pay prevailing wage rates in performing the Contract.

This project is subject to compliance monitoring and enforcement by the Department of Industrial Relations. Contractors must submit their certified payroll records directly to the Division of Labor Standards Enforcement Compliance Monitoring Unit, as well as the City of Stockton.

Pursuant to Stockton Municipal Code Section 3.68.090 preference shall be given to the purchase of supplies, materials, equipment, and contractual services from local merchants, quality and price being equal. Local merchants who have a physical business location within the boundaries of San Joaquin County, and who have applied for and paid a business license tax and registration fee pursuant to Stockton Municipal Code Title 5, Chapter 5.08, License Taxes, shall be granted two (2) percent bid preference. Local merchants who have a physical business location within the boundaries of the City of Stockton Municipal Code Title 5, Chapter 5.08, License Taxes, shall be granted five (5) percent bid preference. This section is intended to provide preference in the award of certain City contracts in order to encourage businesses to move into and expand within the City.

For contracts valued at $100,000 and above, pursuant to Stockton Municipal Code Section

3.68.095 the contractor and all subcontractors shall make a good faith effort to employ at least 50% of the workforce on this project from local residents, as measured by total labor work hours. Failure of any contractor or subcontractor to comply with these requirements shall be deemed a material breach of the contract or subcontract. Contractors and subcontractors shall maintain records necessary for monitoring their compliance with Section 3.68.095.

For contracts valued at $1,000,000 and above, pursuant to the implementation of the Community Workforce and Training Agreement (CWTA) adopted by the City Council on July 26, 2016, the successful bidder shall be required to comply with the provisions of the CWTA.

If the Contract is to be awarded, the Contract will be awarded to the lowest responsive, responsible bidder as defined in the Stockton Municipal Code; provided, however, the City Council reserves the right to reject any and all bids, and to re-advertise for bids or to provide for the work to be done by the City of Stockton's internal work force.

The successful bidder shall be required to furnish a Labor and Materials Bond and a Faithful Performance Bond, each in the sum of one hundred percent (100%) of the contract bid price. Said bonds shall be furnished by a company authorized to issue surety bonds in the State of California, on official forms furnished by the City, and said bonds shall be executed by the surety and contractor before or concurrently with the signing of the Contract. The acceptable surety will meet the minimum standard as set forth in the contract documents.

For information on technical data, contact Kelly Sao, Municipal Utilities Department, (209) 937- 8727, e-mail: [email protected]. For information regarding the cost for the reproduction of the official bid package or to obtain a plan holders list, please contact ARC Document Solutions at 1421 N. El Dorado Street, Stockton, CA 95202, (209) 464-8724 or visit their plan room at https://order.earc.com/arcEOC/PWELL_PublicList.asp?mem=23.

ELIZA R. GARZA, CMC

CITY CLERK

CITY OF STOCKTON
EXHIBIT 2 274
Instructions to Bidders
00100-1
SECTION 00100 - INSTRUCTIONS TO BIDDERS

1.0 WORK TO BE DONE
It is the intention of the City to construct improvements as shown and set forth on the plans, specifications, profiles and detailed drawings, and in the particular locations shown on the drawings. All of the work is particularly set forth in the plans and specifications, and all of said work, together with all other work incidental thereto, is included. By submitting a bid, the bidder represents that it has the ability, qualifications and experience to perform the proposed work.

The work includes the furnishing of all labor, materials, incidentals and equipment necessary for the BROOKSIDE NORTH STORM PUMP STATION DISCHARGE PIPES REHABILITATION (Project No.

US20028). The Contractor shall be required to provide, at its own cost and expense, all necessary insurance, as required by law or these specifications, and shall pay the cost and expense of any and all incidental matters herein required.

2.0 EXAMINATION OF CONTRACT DOCUMENTS
Each bidder shall thoroughly examine and become familiar with the Contract Documents. The submission of a bid shall constitute an acknowledgment upon which the City may rely, and shall constitute conclusive evidence, that the bidder has thoroughly examined and is familiar with the Contract Documents. The failure or neglect of a bidder to receive or examine any of the Contract Documents shall in no way relieve it from any obligation with respect to its proposal or to the Contract. No claim for additional compensation will be allowed which is based upon a lack of knowledge of any Contract Documents.

3.0 INSPECTION OF SITE
Bidders are required to inspect the site of the work to satisfy themselves by personal examination or by such other means as they may prefer, of the location of the proposed work, and of the actual conditions, including subsurface, of and at the site of work. If, during the course of its examination, a bidder finds facts or conditions which appear to be in conflict with the letter or spirit of the bidding documents, the Bidder may apply to the City, in writing, for additional information and explanation before submitting its bid.

Submission of a bid by the bidder shall constitute conclusive evidence that, if awarded the Contract, it has relied and is relying on its own examination of:
a. The site of the work.
b. Access to the site.
c. All other data and matters requisite to the fulfillment of the work and on its own knowledge of existing facilities on and in the vicinity of the site of the work to be constructed under the Contract. d. The conditions to be encountered.
e. The character, quality and scope of the proposed work. f. The quality and quantity of the materials to be furnished. g. The requirements of the bid, the plans, the specifications, and the other Contract Documents.

EXHIBIT 2 275
Instructions to Bidders
00100-2
The information provided by the City is not intended to be a substitute for, or a supplement to the independent verification by the bidder to the extent such independent investigation of site conditions is deemed necessary or desirable by the bidder.

3.1 PRE-BID CONFERENCE
The City may hold a pre-bid conference prior to the bid opening date. The pre-bid conference is held to answer questions bidders may have, provide bidders with access to the site, discuss important contract considerations, and provide any clarifications that may have come to the City’s attention.

Bidders may be required to attend the pre-bid conference on the date indicated on the specifications. If any bidder fails to attend the pre-bid conference when it is indicated as being mandatory on the specifications, then their bid will be deemed non-responsive, which will result in bid rejection.

4.0 INTERPRETATION OF CONTRACT DOCUMENTS
Oral representations or interpretations by the City as to the meaning of the Contract Documents shall have no legal or binding effect. Requests for an interpretation shall be made in writing and delivered at least ten (10) days before the time announced for opening the bids to:

Kelly Sao
Project Manager
Municipal Utilities Department
2500 Navy Drive
Stockton, CA 95206
The City's response to requests to clarify the source of materials, equipment, suppliers or any other such matter which does not modify, change, increase, or decrease the scope of work requires no action by the City other than a response to the bidder requesting the clarification. The City's response to written requests to clarify possible ambiguous or incomplete statements or designs, or any other such clarification which modifies, changes, increases or decreases the scope of work, requires issuance of an addendum by the City for the interpretation to become effective. It is the City's sole discretion whether or not to issue an addendum in response to a request for clarification.

5.0 POSTPONEMENT OF OPENING
The City reserves the right to postpone the date and time for receiving and/or opening of bids at any time prior to the date and time established in the Notice Inviting Bids. Postponement notices shall be mailed to planholders of record in the form of addenda.

6.0 OPENING OF BIDS
All bids except those which do not contain a bid security, irrespective of any other irregularities or informalities, if received on time, will be opened and publicly read aloud at the time and place set forth in the Notice Inviting Bids. Bidders, their representatives and other interested persons may be present at the opening and reading of bids.

Any bids received after the time for receiving and opening bids as set forth in the Notice Inviting Bids or as postponed by addenda will be considered non-responsive and will not be opened. Any such bids will be returned unopened to the Bidder.

The public reading of each bid will include at least the following:
a. Name of bidder.

EXHIBIT 2 276
Instructions to Bidders
00100-3
b. The total amount of bid.
c. The nature and amount of the security furnished with the bid.

7.0 PREPARATION OF BID FORMS
Bids shall be submitted on the official bid documents and must be submitted at the time and place stated in the Notice Inviting Bids. All blanks in the bid forms must be appropriately filled in, either in ink or typed, and all prices must be stated in figures. All bids must be submitted in sealed envelopes bearing on the outside the name of the bidder, its address, the bidder's planholder number, the date of the bid opening, and the name and project number of the project for which the bid is submitted. It is the sole responsibility of the bidder to see that its bid is received in proper time. Any bid received after the scheduled closing time for receipt of bids will be returned to the bidder unopened. City shall not be responsible for errors or omissions in the bid. Bidders shall write their names on each bid form at the space provided.

8.0 BIDDER'S SIGNATURE AND AUTHORITY
If the bid is made by an individual, his/her name, signature, and post office address must be shown; if made by a firm or partnership, the name and post office address of the firm or partnership, a list of the partners, and the signature of at least one of the general partners must be shown; if made by a corporation, the bid shall show the name of the state under the laws of which the corporation is chartered, the name and post office address of the corporation, and the title of the person who signs on behalf of the corporation. If the bid is made by a joint venture, the bid shall be signed by a representative of one of the joint venture firms.

9.0 ERASURES AND CORRECTIONS
The bid submitted must not contain any erasure, interlineations, or other corrections unless each such correction is suitably authenticated by affixing in the margin immediately opposite the correction the initial or initials of the person or persons submitting the bid.

10.0 BID IRREGULARITIES
Changes in or additions to the bid form, recapitulations of the work bid upon, alternative bids, or any other modifications of the bid form which are not specifically called for in the Contract Documents may result in rejection of the bid by the City, as not being responsive to the Notice Inviting Bids. No oral or telephonic modification of any bid submitted will be considered. The City retains the right to waive minor irregularities it determines to have no impact on the Contract.

11.0 MODIFICATION OF BID
On written request filed with the City, a bid already received may be modified or withdrawn at any time prior to the time established for receiving bids. The request must be executed by the bidder or its authorized representative as described in Paragraph 00100-8.0, Bidder's Signature and Authority. Modifications shall be made in writing, executed, and submitted in the same form and manner as the original bid. Withdrawal of a bid does not prejudice a bidder's right to submit a new bid within the time designated for the submission of bids. No bid may be withdrawn after the time established for receiving bids except as provided in Paragraph 00100-12.0, Withdrawal of Bids.

EXHIBIT 2 277
Instructions to Bidders
00100-4

12.0 WITHDRAWAL OF BIDS
In accordance with the Stockton Municipal Code, withdrawal of bids is not allowed after the time noticed for the opening of bids. In case of a materially significant error, a bidder desiring to withdraw shall give written notice to the City, specifying, in detail, how the mistake occurred and how the mistake made the bid materially different than it was intended to be. Withdrawal will not be permitted for mistakes resulting from errors in judgment or carelessness in inspecting the site of the work or in reading the Contract Documents.

At the City's sole discretion, the bid may be deemed non-responsive due to the materially significant error.

13.0 ADDENDA
The Director of Municipal Utilities has the authority to issue any and all Addenda prior to the bid opening date. Addenda issued during the time of bidding shall become a part of the documents furnished to bidders for the preparation of bids, shall be covered in the bids, and shall be made a part of the Contract. Each bid shall include specific acknowledgment in the space provided of receipt of all Addenda issued during the bidding period. Failure to so acknowledge shall result in the bid being rejected as not responsive. Failure of any bidder to receive such Addenda shall not be grounds for non-compliance with the terms of the instructions.

14.0 BID PRICES
Bid prices shall include, whether additive or deductive, everything necessary for the completion of the work, including but not limited to, providing the materials, equipment, tools, fabrication, delivery, installation, plant and other facilities, and the management, superintendence, labor, overhead, profit, and services. Bid prices shall include all taxes required by Paragraph 00700-8.1.3, Payment of Taxes. No tax exemption certificate or any document designed to exempt the Contractor from payment of any tax will be furnished to the Contractor by the City, as to any tax on labor, services, materials, transportation, or any other items furnished pursuant to the Contract. Quote prices for the exact amount for all work required to complete the respective item as described and shown in the Contract Documents.

For unit price bid items, if the product of a unit price and an estimated quantity does not equal the extended amount quoted, the unit price shall govern, and the correct product of the unit price and the estimated quantity shall be deemed to be the amount bid. If the sum of two or more items in a bidding schedule does not equal the total amount quoted, the individual item amounts shall govern and the correct total shall be deemed to be the amount bid.

15.0 BID GUARANTY
The bid form shall be accompanied by a bid guaranty bond provided by a surety company licensed and authorized to carry on business in the State of California, by a certified or cashier's check, payable to the City, or cash, in the sum of at least ten (10) percent of the total amount of the base bid price, plus additives, if any. The amount payable to the City under the bid guaranty bond, or the certified or cashier's check and the amount thereof, as the case may be, shall be forfeited to the City as liquidated damages in case of a failure or neglect of the bidder to furnish, execute, and deliver to the City the required performance and payment bonds, evidences of insurance; and to enter into, execute, and deliver to the City the Agreement on the form provided herewith, within ten (10) calendar days after receiving written notice from the City that the award has been made and the Agreement is ready for execution.

The bid guarantees of the three lowest bidders will be retained until the Agreement is signed, evidence of insurance provided, and satisfactory bonds furnished or other disposition made thereof. The bid guarantees of all bidders, except the three lowest responsive bids, will be returned within 15 calendar days after the bids are opened.

EXHIBIT 2 278
Instructions to Bidders
00100-5

16.0 QUALIFICATION OF BIDDER
Upon the request of City, any bidder whose bid is under consideration for the award of the Contract shall promptly submit satisfactory evidence showing the bidder's financial resources, its construction experience, and its organization's availability for the performance of the Contract.

The bidder may be required to establish to the satisfaction of the City the reliability and responsibility of the persons or entities proposed to furnish and perform the work described in the Contract Documents.

City Employees and Design Engineers May Not Bid on Construction Contracts. No employee of the City shall be eligible to submit a proposal for, nor to subcontract for any portion of, nor to supply any materials for any contract administered by the City.

No engineering or architectural firm which has provided design services for a project shall be eligible to submit a proposal for the contract to construct the project nor to subcontract for any portion of the work.

The ineligible firms include the prime contractor for design, subcontractors of portions of the design, except for surveyors and geotechnical subcontractors and affiliates of either. An affiliate is a firm which is subject to the control of the same persons, through joint ownership or otherwise.

17.0 SUBCONTRACTORS
In accordance with California Public Contract Code Section 4100, et. seq., each bid shall have listed in the official bid documents, the name, portion of work to be performed, and location of the place of business of each subcontractor who will perform work or labor or render service to the bidder in or about the construction of the work or improvement, or of any subcontractor licensed by the State of California who, under subcontract to the bidder, will specially fabricate and install a portion of the work or improvement according to detailed drawings contained in the plans and specifications, in an amount in excess of one-half of one percent of the bidder's total bid.

Failure to list subcontractors may render the bid non-responsive and may be grounds for rejection of the bid. Failure to comply with the provisions of the California "Subletting and Subcontracting Fair Practices Act" shall make the Contractor subject to the sanctions as set forth in the Act. All work, in excess of onehalf of one percent of the bidder's total bid, for which a subcontractor is not listed in the official bid documents, shall be performed by the Contractor's own organization.

The Contractor shall perform at a minimum the percentage of work specified in Section 01010-11.0, CONTRACTOR'S WORK PERCENTAGE, with its own forces and shall not subcontract out this portion of work. The Contractor shall perform that contract work with his own organization, except that any designated "Specialty Items" may be performed by subcontract and the amount of any such "Specialty Items" so performed may be deducted from the original total contract price before computing the amount of work required to be performed by the Contractor with his own organization. When items of work in the BID SCHEDULE, are preceded by the letter (S), said items are designated "Specialty Items." The City may also determine, on a case by case basis, items to be designated "Specialty Items." Where an entire item is sub-contracted, the value of work subcontracted will be based on the contract item bid price. When a portion of an item is sub-contracted, the value of work subcontracted will be based on the estimated percentage of the contract item bid price, determined from information submitted by the Contractor, subject to approval by the City.

EXHIBIT 2 279
Instructions to Bidders
00100-6

18.0 MAJOR EQUIPMENT ITEMS
Intentionally left blank

19.0 SUBSTITUTIONS DURING BIDDING
Manufacturers or suppliers of materials and equipment may offer an alternative product to the Contractor, except where alternatives or substitutes are specifically excluded, and request that alternatives to specified products be considered equal. Inclusion of such alternatives in the bid is the responsibility of the Contractor.

Inclusion should only be considered if the Contractor believes the offered alternative is equal in quality and performance to the specified product. After award of the Contract, such offers of alternative products will be reviewed and processed as a substitution as provided under Section 01600, MATERIAL AND EQUIPMENT. Inclusion or offers of alternative products will not be reviewed or processed during the bidding period.

20.0 BIDDERS INTERESTED IN MORE THAN ONE BID
No person, firm, or corporation, under the same or different name, shall make, file, or be interested in more than one bid for the same work unless alternate bids are called for. A person, firm, or corporation may, however, submit sub proposals or quote prices on materials to more than one bidder.

Bidders shall execute and furnish with their bids, the NON-COLLUSION DECLARATION furnished in the official bid documents. Reasonable grounds to believe that any individual, partnership, corporation, or combination is interested in more that one bid for the proposed work may cause rejection of all bids in which that individual, partnership, corporation, or combination is interested.

21.0 SHEETING, SHORING AND BRACING
Pursuant to the provisions of California Labor Code Section 6707, each bid submitted shall contain, if the bid item is indicated, the amount included in its bid for adequate sheeting, shoring, and bracing, or equivalent method, for the protection of life and limb in trenches and open excavation, which shall conform to applicable safety orders. By listing this sum, the bidder warrants that its action does not convey tort liability to the City, the Design Consultant, the Construction Manager, and their employees, agents, and sub consultants.

22.0 WAGE RATES
Pursuant to provisions of the Labor Code Section 1770, et. seq., of the State of California, the Director of the Department of Industrial Relations has ascertained the prevailing rate of per diem wages of the locality in which the Work is to be performed and applicable to the work to be done. Copies of these wage determinations are on file with the City.

Successful bidders shall promptly notify the City, in writing, about all the classifications of labor not listed in the prevailing wage determinations but necessary for the performance of the Work.

23.0 OFFER OF ASSIGNMENT OF ANTITRUST ACTIONS
As provided by Section 4552, et. seq., of the California Government Code, in submitting a bid to the City, the bidder offers and agrees that if the bid is accepted, it will assign to the City all rights, title, and interest in and to all causes of action it may have under Section 4 of the Clayton Act (15 U.S.C. Section 15) or under the Cartwright Act (Chapter 2 [commencing with Section 16700] of Part 2 of Division 7 of the Business and EXHIBIT 2 280
Instructions to Bidders
00100-7
Professions Code), arising from purchases of goods, materials, or services by the bidder for sale to the City pursuant to the bid.

24.0 ASSIGNMENT OF CONTRACT
The Contractor shall not assign any part of this Contract unless it complies with Section 00700-1.5, SUCCESSORS AND ASSIGNS.

25.0 REJECTION OF BIDS
The City reserves the right to reject any and all bids and further reserves the right to reject any bids which are non-responsive, incomplete, obscure, or irregular; any bids which omit a bid on any one or more items on which the bids are required; any bids in which unit prices are unbalanced in the opinion of the City; any bids accompanied by insufficient or irregular bid guaranty; any bids from bidders who have previously failed to perform properly or to complete on time contracts of any nature; and any bidder who fails to provide satisfactory documentation of its qualifications as required by Section 00100-16.0, QUALIFICATION OF BIDDER. The City reserves the right to waive irregularities.

26.0 CONTRACT AND BONDS
The successful bidder will be required to furnish, in duplicate counterpart, a Labor and Material Bond on forms provided by the City, in an amount equal to one hundred percent (100%) of the Contract Price, a Faithful Performance Bond in an amount equal to one hundred (100%) of the Contract Price, and evidences of insurance. Said insurance and bonds shall be secured from a surety company satisfactory to the City.

The form of contract, and the forms of bonds, as provided in Section 00500, which the successful bidder as Contractor will be required to execute and furnish shall be carefully examined by the bidder. The Faithful Performance Bond is to secure the faithful performance of the Contract, and the Labor and Material Bond is to secure the payment of those to whom the bidder may become legally indebted for labor, materials, tools, equipment, or services of any kind used or employed by the bidder in performing the work.

The Faithful Performance Bond will be retained by the City of Stockton for twelve (12) months following final acceptance by the City of the improvements to guarantee correction of failure attributable to workmanship and materials. Upon said final acceptance by the City, the amount of the Faithful Performance Bond may be reduced to twenty percent (20%) of the actual improvement construction costs, at the sole discretion of the City.

The bonds required of the Contractor shall be furnished by a company authorized to do a surety business in the State of California: said bonds shall be executed by the surety and Contractor before or concurrently with the signing of the contract. The form of said bonds must be approved by the City Attorney and the surety of sureties must be approved by the City Finance Director.

All alterations, extensions of time, extra or additional work and other changes authorized by these specifications, or any part of the Contract may be made without securing the consent of the surety on the contract bonds.

27.0 AWARD OF CONTRACT
Within sixty (60) days after the time of opening of the bids, the City will act either to accept a bid, to reject all bids or with the consent of the bidders and their sureties to extend the time in which the City may act.

Nothing set forth herein shall limit the ability of the City to agree with the lowest responsive, responsible EXHIBIT 2 281
Instructions to Bidders
00100-8
bidder to extend the time for the City to award the Contract to said bidder. The Award of Contract shall obligate the bidder whose bid is accepted to furnish performance and Labor and Material bonds and evidences of insurance, and to execute the Agreement in the form set forth in the Contract Documents.

The Contract will require the completion of the work according to the Contract Documents.

If award is made, it will be based on the lowest responsive, responsible bid whose summation of the base bid and City selected alternates yields the lowest total Contract price. Selection of any or all alternates shall be at the sole discretion of the City.

28.0 EXECUTION OF CONTRACT
The Agreement shall be executed by the successful bidder and returned, together with the Contract bonds and evidences of insurance, within ten (10) days after receiving the Contract. Time is of the essence in this regard. After execution by City, one copy of the Agreement shall be returned to Contractor.

The failure to execute the Contract Documents or to furnish the bonds or insurance required by these instructions within ten (10) days after receiving the Contract constitutes a default. In the event of a default, the City may award the Contract to the next lowest bidder or may re-advertise for bids. The City may charge against the defaulting bidder the greater of (1) the amount of the bid bond, or (2) the difference between the amount of the bid and the amount for which a Contract for the work is subsequently executed, irrespective of whether the amount thus due exceeds the amount of the bid bond. If a more favorable bid is received by re-advertising, the defaulting bidder shall have no claim against the City for a refund.

29.0 BUSINESS LICENSE
The Contractor must obtain and maintain a valid City of Stockton business license prior to execution of the Contract and throughout the fiscal periods embraced by the duration of the Contract.

30.0 CONSTRUCTION AND DEMOLITION DEBRIS
In order to comply with the California Integrated Waste Management Act of 1989, Assembly Bill 939, the City of Stockton requires that construction and demolition projects recycle a minimum of fifty percent (50%) of all discarded materials generated by the projects to divert project waste from the landfills. a. CONSTRUCTION AND DEMOLITION RECYCLING PLAN
This plan is meant to assist contractors with identifying the types and quantities of materials that will be generated as a result of the project in order to find diversion outlets for these materials.

Once the Contract has been awarded, the contractor is required to complete and submit a Construction/Demolition (C&D) Recycling Plan prior to receiving a Notice to Proceed. The plan should be submitted to the Project Manager at the pre-construction meeting. The City may also request additional information, as necessary.
b. CONSTRUCTION AND DEMOLITION DEBRIS RECYCLING REPORT
The contractor must complete the Construction and Demolition (C&D) Debris Recycling Report within thirty (30) days of construction or demolition project completion (Notice of Completion). The completed must be accompanied by the official weight tags or receipts verifying the information provided in the report and must be submitted to the City of Stockton Public Works Department, Solid Waste Division, Stewart Eberhardt Building, 22 E. Weber Ave., Room 301, Stockton, CA 95202. Failure to provide the C&D Recycling Report form will result in a five percent (5%) withholding of the contract amount.
(Recycling forms are available at http://www.stocktongov.com/files/C&D%20Package.pdf).

EXHIBIT 2 282
Instructions to Bidders
00100-9

31.0 NOT USED
a. SCOPE

1. The Contractor shall submit, within five (5) days after the award of the Contract one (1) copy of all documentary information generated in preparation of the bid price for the project. This material is hereinafter referred to as “Escrow Bid Documents.” The Escrow Bid Documents will be held in escrow of the duration of the contract.

2. The Contractor agrees that the Escrow Bid Documents constitute all of the information used in preparation of the bid, and that no other bid preparation information will be considered in resolving claims.

3. Nothing in the Escrow Bid Documents shall change or modify the terms or conditions of the Contract.
b. TRADE SECRETS
The Escrow Bid Documents are and will always remain the property of the Contractor, subject only to joint review by the City and the Contractor, as provided in paragraph (G) “Examination.” The City stipulates and expressly acknowledges that the Escrow Bid Documents constitute trade secrets and are proprietary and confidential. This acknowledgment is based on the City’s express understanding that the information contained in the Escrow Bid Documents is not known outside the Contractor’s business, is known only to a limited extent and only by a limited number of employees of the Contractor, is safeguarded while in Contractor’s possession, is extremely valuable to Contractor and could be extremely valuable to Contractor’s competitors by virtue of it reflecting Contractor’s contemplated techniques of construction. City acknowledges that the Contractor expended substantial sums of money in developing the information included in the Escrow Bid Documents and further acknowledges that it would be difficult for a competitor to replicate the information contained therein. City further acknowledges that the Escrow Bid Documents and the information used in the Contractor’s business, were intended to give the Contractor an opportunity to obtain an advantage over competitors who do not know of or use the contents of the documentation. City agrees to safeguard the Escrow Bid Documents and all the information contained therein against disclosure to the fullest extent permitted by law. c. PURPOSE
Escrow Bid Documents will be used to assist in the negotiation for the settlement of claims. They will not be used for evaluation of the Contractor’s anticipated methods of construction or to assess the Contractor’s qualification for performing the work. d. FORMAT AND CONTENTS

1. Contractor may submit Escrow Bid Documents in the usual cost-estimating format. Escrow Bid Documents shall be adequate to enable complete understanding and proper interpretation for their intended use.

2. Escrow Bid Documents shall clearly itemize the estimated costs of performing the work.

Items shall be separated into sub-items as required to present a complete and detailed cost estimate and allow a detailed cost review. The Escrow Bid Documents shall include all quantity takeoffs, labor, equipment, calculations of rate production and progress, copies of quotations from subcontractors and suppliers, and memoranda, narratives, consultant’s reports, add/deduct sheets, and all other information used by the Contractor to arrive at the prices contained in the bid proposal. Estimated costs shall be broken down into the Contractor’s usual estimate categories such as direct labor, repair labor, material, equipment, construction equipment operation, construction equipment ownership, EXHIBIT 2 283
Instructions to Bidders
00100-10
expendable materials, materials and subcontractor cost as appropriate. Plant and equipment, indirect costs shall be detailed in the Contractor’s usual format. The Contractor’s allocation of plant and equipment, indirect costs, contingencies, markup and other items shall be included.

3. All costs shall be identified for all items. Sub-items amounting to less than $10,000.00 estimated unit costs are acceptable without a detailed cost estimate, provided that labor, equipment, materials, construction equipment, expendable materials and subcontracts, as applicable, are included, and provided that indirect costs, contingencies, and mark-up, as applicable, are allocated.

4. Bidding materials provided by the City shall not be included in the Escrow Bid Documents unless needed to comply with the requirements of this specification. e. SUBMITTAL

1. The Escrow Bid Documents shall be submitted by the Contractor in a sealed container(s) within five (5) days after the day of award of the contract. The container shall be clearly marked on the outside with the Contractor’s name, date of submittal, project name and the words “Escrow Bid Documents.”

2. The Escrow Bid Documents shall be accompanied by an index to inventory the contents of the submittal and a Bid Documentation Certification, signed by the individual who executed the bidding proposal, stating that the material in the Escrow Bid Documents constitutes all documentary information used in preparation of the bid and that he/she has personally examined the contents of the Escrow Bid Documents container and has found that the documents in the container(s) are complete and organized as shown by the Contractor’s index.

3. City shall examine the index. This examination is to ensure that the index is detailed and complete and conforms to the “format and contents” as stated in paragraph (d) above. If all the documentation required in paragraph (d) “Format and Contents” has not been indexed in the original submittal a revised index shall be submitted at the City’s discretion.

Timely submission of complete Escrow Bid Documents is an essential element of the Contractor’s responsibility. FAILURE TO PROVIDE THE NECESSARY ESCROW BID

DOCUMENTS MAY BE SUFFICIENT CAUSE FOR THE CITY TO ASSESS DAMAGES UNDER THE CONTRACT. If the Contractor’s proposal is based on subcontracting any part of the work, each subcontractor, whose total subcontract price exceeds the lesser of five percent (5%) of the total contract price proposed by the Contractor or $200,000 shall provide separate Escrow Bid Documents to be submitted with those of the Contractor.

These submittals will be examined in the same manner and at the same time as the examination described above. If the Contractor wishes to subcontract any portion of the work or requests substitutions of any subcontractor after award, the City retains the right to require the Contractor to submit Escrow Bid Documents from the proposed subcontractor before the subcontract or substitution is approved. f. STORAGE
The Escrow Bid Documents will be placed in escrow, for the life of the contract, in a mutually agreeable institution. The City will pay the cost of storage. g. EXAMINATION

1. The Escrow Bid Documents shall be examined by the City, the Construction Manager and Contractor, at any time deemed necessary by either the City or the Contractor, to assist in the negotiation for the settlement of claims.

EXHIBIT 2 284
Instructions to Bidders
00100-11

2. Examination of the Escrow Bid Documents is subject to the following conditions:
a. As trade secrets, the Escrow Bid Documents are proprietary and confidential as described in paragraph (b).
b. The City and the Contractor shall each designate, in writing to the other party and a minimum of five (5) days prior to examination, representatives who are authorized to examine the Escrow Bid Documents. No other person shall have access to the Escrow Bid Documents.
c. Access to the Escrow Bid Documents under this paragraph will take place only in the presence of duly designed representatives of both the City and the Contractor. h. FINAL DISPOSITION
The Escrow Bid Documents will be returned to the Contractor at such time as the contract has been completed and final settlement has been achieved.

32.0 BID PROTESTS
All parties wishing to file a protest shall comply with the procedures set forth below.

All protests regarding the bidding process or the award, or intended award, of any contract must be submitted in writing to the City Attorney on or before 5:00 p.m. of the fifth business day following the opening of all bids, unless a different time period is specified in the Notice Inviting Bids or other bid solicitation documents. All protests must be addressed to: City Attorney, City of Stockton, 425 North El Dorado, Stockton, CA 95202.

The party filing the protest must have actually submitted a bid for the work. A subcontractor of a bidder may not submit a bid protest.

The protest shall contain a full and complete statement specifying in detail the grounds of the protest and the facts in support thereof. The protest must be hand delivered or sent via mail so that it is received by the City Attorney within the time period set forth above. The protest document must include the following:
a. A complete statement of the factual and legal basis for the protest; b. The protest must include the name, address and telephone number of the person representing the protesting party; and
c. The protesting party must concurrently transmit a copy of the written protest document and any attached documentation to all other bidders who may have a reasonable prospect of receiving the award depending upon the outcome of the protest.

The procedure and time limits set forth herein are mandatory and the bidder's sole and exclusive remedy in the event of protest. No bidder may bring an action or proceeding challenging the bidding process or any award, or intent to award, any contract unless the above procedures are followed. The failure of a party originating a protest to comply with these procedures shall constitute a waiver of any right to further pursue the protest, including filing a government code claim or legal proceeding. The City reserves the right to modify the bid protest procedures in the Notice Inviting Bids or other bid solicitation documents and to require any protesting party to submit additional or clarifying information or documentation in support of any protest.

33.0 LOCAL EMPLOYMENT
For contracts valued at $100,000 and above, pursuant to Stockton Municipal Code Section

3.68.095 the contractor and all subcontractors shall make a good faith effort to employ at least 50% of the workforce on this project from local residents, as measured by total labor work hours. Failure of any contractor or subcontractor to comply with these requirements shall be deemed a material breach of the EXHIBIT 2 285
Instructions to Bidders
00100-12
contract or subcontract. Contractors and subcontractors shall maintain records necessary for monitoring their compliance with Section 3.68.095.

34.0 COMMUNITY WORKFORCE AND TRAINING AGREEMENT
For contracts valued at $1,000,000 and above, pursuant to the implementation of the Community Workforce and Training Agreement (CWTA) adopted by the City Council on July 26, 2016, the successful bidder shall be required to comply with the provisions of the CWTA. *** END OF SECTION ***
EXHIBIT 2 286
Geotechnical Data
00220-1
SECTION 00220 - GEOTECHNICAL DATA
Subsoil investigations have not been conducted at the site of the work.

The Contractor should visit the site and acquaint himself with all existing conditions. Prior to bidding, contractors may make their own subsurface investigations to satisfy themselves as to site and subsurface conditions but such subsurface investigations shall be performed only under time schedules and arrangements approved in advance by the Engineer.
***END OF SECTION***
EXHIBIT 2 287
Geotechnical Data
00220-2
EXHIBIT 2 288
Bid Schedule
00300-1
SECTION 00300 – LIST OF BID ITEMS

BROOKSIDE NORTH STORM PUMP STATION DISCHARGE PIPES

REHABILITATION
Project No. US20028
Item
#
Description Est.

Quantity Unit Unit Price Total Price
1 Mobilization, Demobilization, Bonds,
Permits, and Insurance on all work 1 LS
2 Pre-construction CCTV and Cleaning 1 LS
3 Post-construction CCTV 1 LS
4 Two (2) 24" CIPP Liners and End Seals 240 LF
5 One (1) 14" CIPP Liner and End Seal 120 LF
6 Contingency 1 LF $10,000 $10,000
TOTAL BID: The sum of Items 1 through 6
***END OF SECTION***
EXHIBIT 2 289
Bid Schedule
00300-2
EXHIBIT 2 290
Construction Contract
00500-1
SECTION 00500 - CONSTRUCTION CONTRACT
This contract is made and entered into on _____________, by and between NAME OF CONTRACTOR, a (INDICATE STATUS: STATE OF [NAME STATE] CORPORATION, PARTNERSHIP, OR SOLE PROPRIETORSHIP), with a business address at ADDRESS/CITY/STATE/ZIP, hereinafter called "CONTRACTOR," and CITY OF STOCKTON, a municipal corporation, hereinafter called "CITY." W I T N E S S E T H:

WHEREAS, plans and specifications for the construction of PROJECT NAME (PROJECT NO. xx), hereinafter called “PROJECT,” were regularly adopted by Council Motion –OR- Council Resolution No. __________________, on _________________; and
WHEREAS, the contract for said work was regularly awarded to CONTRACTOR, by Council Motion –OR- Council Resolution No. __________________, on ________________.

NOW, THEREFORE, in consideration of the promises and of the mutual covenants herein contained, the parties hereto expressly agree as follows:

CONTRACTOR agrees:

1. SCOPE OF SERVICES. To do the work and furnish all the labor, materials, tools, equipment, and insurance required for the construction of PROJECT in accordance with the plans and specifications adopted on _____________, by Council Motion –OR- Council Resolution No. __________________ . The "contract documents," which include the bid documents, project plans, specifications, all letters of clarification, and the City of Stockton Standard Specifications and Plans, are incorporated into and made a part of this contract by this reference to the same extent as if fully set forth.

2. COMPENSATION. To do and perform the work contemplated hereby in a good and workmanlike manner and to furnish all labor, materials, tools, and equipment necessary therefore at the prices specified in Exhibit A, attached hereto and by reference made a part hereof, under the direction of and to the complete satisfaction of the Director of Municipal Utilities Department of the City of Stockton.

Total compensation for services and reimbursement for costs shall not exceed ENTER CONTRACT AMOUNT, or as otherwise mutually agreed to in a Contract Change Order.

3. INSURANCE. CONTRACTOR shall not commence any work before obtaining, and shall maintain in force at all times during the duration and performance of this contract, the policies of insurance specified in Exhibit B, which is attached to this contract and incorporated by this reference, and as provided in the “contract documents” including Section 7-1.06 of the City of Stockton Standard Specifications and Plans as adopted on September 27, 2016, by Council Resolution No. 2016-09-27, effective September 27, 2016.

It shall be a requirement under this agreement that any available insurance proceeds broader than or in excess of the specified minimum insurance coverage requirements and/or limits shall be available to the Additional Insured.

Furthermore, the requirements for coverage and limits shall be (1) the minimum coverage and limits specified in this Agreement; or (2) the broader coverage and maximum limits of coverage of any insurance policy or proceeds available to the named Insured; whichever is greater.

The Additional Insured coverage under the CONTRACTOR’s policy shall be “primary and non-contributory” and will not seek contribution from the City of Stockton’s insurance or self-insurance and shall be at least as broad as ISO CG 20 01 04 13.

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

EXHIBIT 2 291
Construction Contract
00500-2
All self-insured retentions (SIR) must be disclosed to the CITY’s Risk Management for approval and shall not reduce the limits of liability. Payment Bond in the amount of the self-insured retention (SIR) may be required.

Policies containing any self-insured retention (SIR) provision shall provide or be endorsed to provide that the SIR may be satisfied by either the named insured or the CITY.

The CITY reserves the right to obtain a full certified copy of any insurance policy and endorsements.

Failure to exercise this right shall not constitute a waiver of right to exercise later.

CONTRACTOR shall maintain insurance as required by this contract to the fullest amount allowed by law and shall maintain insurance for a minimum of five years following the completion of this project. In the event contractor fails to obtain or maintain completed operations coverage as required by this agreement, the City at its sole discretion may purchase the coverage required and the cost will be paid by contractor.

CONTRACTOR agrees to include with all Subcontractors in their subcontract the same requirements and provisions of this agreement including the indemnity and insurance requirements to the extent they apply to the scope of the Subcontractor’s work. Subcontractors hired by CONTRACTOR agree to be bound to CONTRACTOR and the CITY in the same manner and to the same extent as CONTRACTOR is bound to the CITY under the Contract Documents. Subcontractor further agrees to include these same provisions with any Sub-subcontractor. A copy of the CITY Contract Document Indemnity and Insurance provisions will be furnished to the Subcontractor upon request. The General CONTRACTOR shall require all subcontractors to provide a valid certificate of insurance and the required endorsements included in the agreement prior to commencement of any work and contractor will provide proof of compliance to the City.

4. INDEMNITY AND HOLD HARMLESS. To the fullest extent permitted by law, Contractor shall hold harmless, defend, and indemnify City of Stockton and its officers, officials, employees, and volunteers from and against all claims, damages, losses, and expenses including attorney fees arising out of the performance of the work described herein, caused in whole or in part by any negligent act or omission of the Contractor, any subcontractor, anyone directly or indirectly employed by any of them, or anyone for whose acts any of them may be liable, except where caused by the active negligence, sole negligence, or willful misconduct of the City of Stockton. This obligation is independent of, and shall not in any way be limited by, the minimum Insurance obligations contained in this agreement. These obligations shall survive the completion or termination of this agreement.

5. STANDARD PLANS AND SPECIFICATIONS. The performance of said work and the furnishing of said materials shall be executed in accordance with Section 8-1.04B of the City of Stockton Standard Specifications and Plans as adopted on September 27, 2016, by Council Resolution No. 2016- 09-27-1213, effective September 27, 2016, and the provisions of the issued project specifications.

The Director of Municipal Utilities Department will furnish CONTRACTOR a weekly statement showing the number of days charged to the contract for the preceding week, the number of days specified for completion of the contract, and the number of days remaining to complete the contract. CONTRACTOR will be allowed one (1) week in which to file a written protest setting forth in what respects said weekly statement is incorrect, otherwise the statement shall be deemed to have been accepted by CONTRACTOR as correct.

6. WORKING DAYS. It is agreed by the parties to the contract that in case all the work called for under the contract in all parts and requirements, is not finished or completed within the number of days as set forth, damage will be sustained by the CITY, and that it is and will be impracticable and extremely difficult to ascertain the actual damage which CITY will sustain in the event of and by reason of such delay; and it is therefore agreed that CONTRACTOR will pay to CITY the sum of XXX AND NO/100 DOLLARS ($XXX) per day for each and every calendar day's delay in finishing the work in excess of the number of days prescribed; and CONTRACTOR agrees to pay said liquidated damages as herein provided, and in EXHIBIT 2 292
Construction Contract
00500-3
case the same are not paid, agrees that CITY, may deduct the amount thereof from any monies due or that may become due CONTRACTOR under the contract.

It is further agreed that in case the work called for under the contract is not finished and completed in all parts and requirements within the number of days as specified, the CITY shall have the right to increase the number of days or not, as may seem best to serve the interest of CITY, and if the CITY decides to increase the said number of days, the CITY shall further have the right to charge to CONTRACTOR, CONTRACTOR's heirs, assigns or sureties, and to deduct from the final payment for the work, all or any part, as may be deemed proper, the liquidated damages as specified or the actual cost of engineering, inspection, superintendence, and other overhead expenses which are directly chargeable to the contract, and which accrue during the period of such extension, whichever is greater, except the cost of final surveys and preparation of final estimate shall not be included in such charges.

A working day shall not include, nor shall CONTRACTOR be assessed with liquidated damages nor the additional cost of engineering and inspection during any delay beyond the time named for the completion of the work caused by acts of God or of the public enemy, acts of CITY, fire, floods, epidemics, quarantine restrictions, strikes, and freight embargoes and subject to approval by the Director of Municipal Utilities Department, inability to get materials ordered by CONTRACTOR or subcontractor due to such causes provided that CONTRACTOR shall notify the Director of Municipal Utilities Department in writing of the causes of delay within five (5) working days from the beginning of any such delay, and the Director shall ascertain the facts and the extent of the delay, and Director's findings of the facts thereon shall be final and conclusive.

If CONTRACTOR is delayed by reason of alterations made in these specifications, or by any act of the Director of Municipal Utilities Department or of the CITY, not contemplated by the contract, the time of completion shall be extended proportionately and CONTRACTOR shall be relieved during the period of such extension of any claim for liquidated damages, engineering or inspection charges or other penalties.

CONTRACTOR shall have no claim for any other compensation for any such delay.

7. CONFORMANCE TO APPLICABLE LAWS. Contractor shall comply with all applicable Federal, State, and Municipal laws, rules, and ordinances. Contractor shall not discriminate in the employment of persons or in the provision of services under this Contract on the basis of any legally protected classification, including race, color, national origin, ancestry, sex or religion of such person. a. TITLE VI
Title VI of the Civil Rights Act of 1964 requires that “no person in the United States shall, on the grounds of race, color, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving federal financial assistance.” (42 USC Section 2000d)
http://www.dol.gov/oasam/regs/statutes/titlevi.htm.

The City of Stockton requires compliance with the requirements of Title VI in all of its programs and activities regardless of funding source.
b. DISCRIMINATION AND HARASSMENT POLICY
The City of Stockton has a Discrimination and Harassment Policy (Exhibit C). The purpose of this policy is to reaffirm the CITY’s commitment to demonstrating respect for all individuals by strictly prohibiting discrimination and harassment, including sexual harassment in the workplace, to define the types of behavior and conduct prohibited by this policy, and to set forth a procedure for reporting, investigating, and resolving complaints of discrimination and harassment in the workplace. c. LABOR STANDARDS PROVISIONS/CALIFORNIA LABOR CODE
EXHIBIT 2 293
Construction Contract
00500-4
The bidder shall understand that conditions set forth in Division 2, Part 7, Chapter 1, Article 2, Wages of the California Labor Code shall be considered part of the contract agreement. https://leginfo.legislature.ca.gov/faces/codes_displayText.xhtml?lawCode=LAB&division=

2.&title=&part=7.&chapter=1.&article=2.
d. PREVAILING WAGE
CONTRACTOR and any subcontractor shall pay each employee engaged in the trade or occupation not less than the prevailing hourly wage rate. In accordance with the provisions of Section 1770 of the Labor Code, the Director of Department of Industrial Relations of the State of California has determined the general prevailing wage and employer payments for health and welfare, pension, vacation, travel time, and subsistence pay as provided for in Section 1773.1, apprenticeship or other training programs authorized by Section 3093 and similar purposes applicable to the work to be done. CONTRACTOR performing the work under this contract shall obtain a copy of the wage rate determination and shall distribute copies to each subcontractor. As the wage determination for each craft reflects an expiration date, it shall be the prime CONTRACTOR and each subcontractor's responsibility to ensure that the prevailing wage rates of concern is current and paid to the employee.
i. The CONTRACTOR performing the work shall be responsible for obtaining a copy of the State wage rate determination. State wage rates may be obtained at http://www.dir.ca.gov/OPRL/pwd/Determinations/Northern/Northern.pdf. The CONTRACTOR shall be responsible for posting said wage rates at a prominent location at the work site and shall maintain same in a good readable condition for the duration of the work.
ii. Should the CONTRACTOR choose to work on a Saturday, Sunday or on a holiday recognized by the Labor Unions, the CONTRACTOR shall reimburse the CITY the actual cost of engineering, inspection, superintendence, and or other overhead expenses which are directly chargeable to the contract. Should such work be undertaken at the request of the CITY, reimbursement will not be required. To conform strictly with the provisions of Division 2, Part 7, Chapter 1, Article 2, of the Labor Code of the State of California. To forfeit as a penalty to CITY the sum of TWENTY-FIVE AND NO/100 DOLLARS ($25.00) for each laborer, worker, or mechanic employed by CONTRACTOR, or by any subcontractor under CONTRACTOR, in the execution of this contract, for each calendar day during which any laborer, worker, or mechanic is required or permitted to work more than eight (8) hours and who is not paid the general prevailing rate of per diem wages for holiday and overtime work in violation of the provisions of Sections 1770 to 1781 of the Labor Code of the State of California. That all sums forfeited under the provisions of the foregoing sections shall be deducted from the payments to be made under the terms of this contract.
iii. The CONTRACTOR to whom the contract is awarded shall ensure that the prime and each subcontractor will in accordance with Section 1776 of the Labor Code, maintain certified payroll records. A copy of said records shall be provided with each invoice to the Municipal Utilities Department, Attention Contract Compliance Officer. It shall be the CONTRACTOR’S responsibility to obtain copies of the current prevailing wage rate determination for all subcontractors. Additionally, certified payroll records must be uploaded to the DIR website as required by labor code. iv. The CONTRACTOR shall comply with the provisions established in Section 1777.5 of the Labor Code concerning the 1) certified approval by local joint apprenticeship EXHIBIT 2 294
Construction Contract
00500-5
committees for the employment and training of apprentices, and 2) contribution of funds to administer and conduct apprenticeship programs, if applicable to the job. e. LOCAL EMPLOYMENT ORDINANCE
For contracts valued at $100,000 and above, pursuant to Stockton Municipal Code Section

3.68.095 the CONTRACTOR and all subcontractors shall make a good faith effort to employ at least 50 percent of the workforce on this project from local residents, as measured by total labor work hours. Failure of any CONTRACTOR or subcontractor to comply with these requirements shall be deemed a material breach of the contract or subcontract. CONTRACTORS and subcontractors shall maintain records necessary for monitoring their compliance with Section 3.68.095.
f. COMMUNITY WORKFORCE TRAINING AGREEMENT
For contracts valued at 1,000,000 and above, pursuant to the implementation of the Community Workforce Training Agreement (CWTA) adopted by the City Council on July 26, 2016, the successful bidder shall be required to comply with the provisions of the CWTA. For any project subject to this Agreement, the Local Hire, Priority Apprentice and Workforce Development Program requirements shall apply in lieu of the requirements of Stockton Municipal Code Section 3.68.095 and no separate compliance with Section 3.68.095 will be required of the Contractors/Employers working on the project.

CITY agrees:

8. COMPENSATION. To pay CONTRACTOR for the work herein contemplated in the following manner: Progress payments will be made on or about the first day of each calendar month, in such sum as shall make the aggregate of payment up to such day equal to ninety-five percent (95%) of the proportional contract price, upon the basis of the progress certificate of the Director of Municipal Utilities Department as to the amount of work done and the proportional amount of the contract price represented therefore; and all of the remaining part of the contract price not as aforesaid paid, shall be paid at the expiration of thirty-five (35) days from the completion of said work of construction and the certification by the Director of Municipal Utilities Department of such completion.

9. SECURITIES. Pursuant to Section 22300 of the Public Contract Code, CONTRACTOR will be permitted, at its request and sole expense, to substitute securities for any monies withheld by the CITY to ensure performance under the contract. Said securities will be deposited either with the CITY or with a State or federally chartered bank as escrow agent. Securities eligible for this substitution are those listed in Section 16430 of the California Government Code or bank or savings and loan certificates of deposit.

CONTRACTOR shall be the beneficial owner of any securities substituted for monies withheld and shall receive any interest thereon.

10. CHANGE ORDERS. CITY reserves the right to make such alterations, deviations, additions to or omissions from the plans and specifications, including the right to increase or decrease the quantity of any item or portion of the work, as may be deemed by the Engineer to be necessary or advisable and to require such extra work as may be determined by the Engineer to be required for the proper completion or construction of the whole work contemplated.

Any such changes will be set forth in a contract change order which will specify, in addition to the work done in connection with the change made, adjustment of contract time, if any, and the basis of compensation for such work. A contract change order will not become effective until approved by the City Manager and/or the City Council.

Processing of change orders shall be in accordance with Section 4-1.05A of the City of Stockton Standard Specifications and Plans as adopted by Council on September 27, 2016, by Resolution No. 2016-09-27- EXHIBIT 2 295
Construction Contract
00500-6
1213, effective September 27, 2016, or as otherwise amended by Council. When the compensation for an item of work is subject to adjustment under the provisions of Standard Specifications and Plans, Section 4-

1.05A, CONTRACTOR shall, upon request, promptly furnish the Engineer with adequate detailed cost data for such item of work.

11. AUDITS. CITY reserves the right to periodically audit all charges made by CONTRACTOR to CITY for services under the contract. Upon request, CONTRACTOR agrees to furnish CITY, or a designated representative, with necessary information and assistance.

CONTRACTOR agrees that CITY or its delegate will have the right to review, obtain and copy all records pertaining to performance of the contract. CONTRACTOR agrees to provide CITY or its delegate with any relevant information requested and shall permit CITY or its delegate access to its premises, upon reasonable notice, during normal business hours for the purpose of interviewing employees and inspecting and copying such books, records, accounts, and other material that may be relevant to a matter under investigation for the purpose of determining compliance with this requirement. CONTRACTOR further agrees to maintain such records for a period of three (3) years after final payment under the contract.

12. WAIVER. It is expressly understood and agreed by and between the parties hereto that a waiver of any of the conditions of this contract shall not be considered a waiver of any of the other conditions thereof.

It is further understood and agreed by and between the parties hereto that time is of the essence of this contract in all respects.

IN WITNESS WHEREOF, the parties hereto have hereunto affixed their hands and seals the day and year first above written.

ATTEST: CITY:

ELIZA R. GARZA, CMC

CITY CLERK

CITY OF STOCKTON
By:

By: HARRY BLACK

CITY MANAGER
APPROVED AS TO FORM & CONTENT:

LORI ASUNCION

OFFICE OF THE CITY ATTORNEY
By:

LIST NAME OF CONTRACTOR
By:

ASSISTANT CITY ATTORNEY
Tax Identification No.

EXHIBIT 2 296
Construction Contract
00500-7

LOCAL EMPLOYMENT ORDINANCE
This contract is subject to the requirements of the City of Stockton’s Local Employment Ordinance. By my signature below, I certify that I have read and understood the Local Employment Ordinance of the City of Stockton, and agree to abide by its provisions. If selected to perform this contract, I specifically agree to report data on the actual number of Stockton residents employed, and understand that data will be subject to verification by an independent auditor.

Signature of Bidder
Date Signed
EXHIBIT 2 297
Construction Contract
00500-8
Addendum A

CITY OF STOCKTON COMMUNITY WORKFORCE AND TRAINING AGREEMENT

AGREEMENT TO BE BOUND
The undersigned, as a Contractor or Subcontractor, including construction material trucking company/entity, (CONTRACTOR) on the City of Stockton Project, (hereinafter PROJECT), for and in consideration of the award to it of a contract to perform work on said PROJECT, and in further consideration of the mutual promises made in this Community Workforce and Training Agreement (hereinafter AGREEMENT), a copy of which was received and is acknowledged, hereby:
(1) Accepts and agrees to be bound by the terms and conditions of the AGREEMENT for this Project, together with any and all amendments and supplements now existing or which are later made thereto:
(2) The CONTRACTOR agrees to be bound by the legally established local trust agreements designated in the applicable Schedule A as set forth in Article IV of this AGREEMENT.
(3) The CONTRACTOR authorizes the parties to such local trust agreements to appoint trustees and successor trustees to administer the trust funds and hereby ratifies and accepts the trustees so appointed as if made by the CONTRACTOR; (4) Certifies that it has no commitments or agreements which would preclude its full and complete compliance with the terms and conditions of said AGREEMENT. (5) Agrees to secure from any CONTRACTOR(S) (as defined in said AGREEMENT) which is or becomes a subcontractor (of any tier) to it, a duly executed Agreement to be Bound in form identical to this document.
(6) This Agreement to be Bound constitutes a subscription agreement to the extent of its terms. However, the undersigned agrees to execute a separate Subscription Agreement(s) or contributing employer agreement for Trust Funds when such Trust Fund(s) requires such document(s).

Date:______________________ __________________________________ Name of Contractor
__________________________________
(Name of Contractor Representative)
__________________________________
(Authorized Officer & Title)
__________________________________
CSLB # of Motor Carrier Permit
EXHIBIT 2 298
Construction Contract
00500-9

EXHIBIT A

BROOKSIDE NORTH STORM PUMP STATION DISCHARGE PIPES

REHABILITATION
Project No. US200028
Item
#
Description Est.

EXHIBIT B
REFER TO SECTION 00820 – LIABILITY AND INSURANCE REQUIREMENTS EXHIBIT 2 300
Construction Contract
00500-11

EXHIBIT C

DISCRIMINATION AND HARASSMENT POLICY
EXHIBIT 2 301
Construction Contract
00500-12

BOND FOR FAITHFUL PERFORMANCE
KNOW ALL MEN BY THESE PRESENTS:

That we, _______________________________, a (INDICATE STATUS: STATE OF [NAME STATE] CORPORATION, PARTNERSHIP, OR SOLE PROPRIETORSHIP), as Principal and , a corporation, organized and
existing under the laws of the State of and duly authorized to transact business under the laws of the State of California, as Surety, are held and firmly bound unto the City of Stockton, a municipal corporation, duly created and existing under and by virtue of the laws of the State of California, as obligee, in the just and full sum of SPELL OUT CONTRACT AMOUNT AND xx/100 DOLLARS ($xxx enter dollar amount), in lawful money of the United States of America (being 100% of the contract price) for the payment whereof well and truly to be made to the said CITY, the said Principal and Surety bind themselves, their successors and assigns, jointly and severally, firmly by these presents.

The condition of the foregoing obligation is such that the above bounded Principal has simultaneously entered into a contract with the CITY, to do and perform the following work, to wit:

NAME OF PROJECT
(PROJECT NO. xxx)
NOW, THEREFORE, if the above bounded Principal, CONTRACTOR, Company or Corporation or its subcontractor, shall well and truly perform the work contracted to be done under said contract, then this obligation to be null and void; otherwise to remain in full force and effect.

No prepayment or delay in payment and no change, extension, addition or alteration of any provision of said contract, or in said plans or specifications agreed to between the said CONTRACTOR and the said EXHIBIT 2 302
Construction Contract
00500-13
CITY, and no forbearance on the part of the said CITY shall operate to relieve any Surety or Sureties from liability on this bond, and consent by said Surety is hereby given, and the said Surety hereby waives the provisions of Sections 2819 and 2845 of the Civil Code of the State of California.

SIGNED AND SEALED on
APPROVED AS TO SURETY: By:

PRINCIPAL

SURETY
APPROVED AS TO FORM & CONTENT:

LORI ASUNCION

OFFICE OF THE CITY ATTORNEY
By:

ATTORNEY-IN-FACT
By:

ASSISTANT CITY ATTORNEY
EXHIBIT 2 303
Construction Contract
00500-14

BOND FOR LABOR AND MATERIAL
KNOW ALL MEN BY THESE PRESENTS:

That we, NAME OF CONTRACTOR, a (INDICATE STATUS: STATE OF [NAME STATE] CORPORATION, PARTNERSHIP, OR SOLE PROPRIETORSHIP), as Principal and , corporation, organized and existing under the laws of the State of and duly authorized to transact business under the laws of the State of California, as Surety, are held and firmly bound unto the City of Stockton, a municipal corporation, duly created and existing under and by virtue of the laws of the State of California, and unto any and all material suppliers, persons, companies, or corporations furnishing materials, provisions, provender or other supplies used in, upon, for or about the performance of the work contemplated to be executed or performed under the contract hereinafter mentioned, and all persons, companies, or corporations renting or hiring teams, or implements of machinery, for or contributing to said work and all persons who perform work or labor upon the same, and all persons who supply both work and materials, and whose claims have not been paid by the contractor, company or corporation in the just and full sum of SPELL OUT DOLLAR AMOUNT AND xx/100 DOLLARS ($xxx enter dollar amount), in lawful money of the United States of America (being 100% of the contract price) for the payment whereof well and truly to be made to said CITY and to said persons jointly and severally, the said principal and Surety bind themselves, their successors and assigns, jointly and severally, firmly by these presents.

The condition of the foregoing obligations is such that the above bounden Principal has simultaneously entered into a contract of even date herewith, with the CITY, to do and perform the following work, to-wit:

NAME OF PROJECT
(PROJECT NO. xxx)
NOW, THEREFORE, if the above bounden Principal, CONTRACTOR, Company or Corporation or its subcontractor, fail to pay for all materials, provisions, provender, or other supplies, or teams, used in, upon, for or about the performance of the work contracted to be done, or for any work or labor done thereon of any kind, the Surety on this bond will pay the same, in an amount not exceeding the sum specified in this bond, provided that any and all claims hereunder shall be filed and proceedings had in connection therewith as required by the provisions of Division 3, Part 4, Title 15, Chapter 5, Article 1 of the Civil Code of California, provided that in case suit is brought upon this bond, a reasonable attorney's fee shall be awarded by the Court to the prevailing party in said suit; said attorney's fee to be fixed as costs in said suit, and to be included in the judgment therein rendered.

No prepayment or delay in payment and no change, extension, addition or alteration of any provision of said contract or in said plans or specifications agreed to between the said CONTRACTOR and the said CITY and no forbearance on the part of the said CITY shall operate to relieve any surety or sureties from liability on this bond, and consent to make such alterations without further notice to or consent by any EXHIBIT 2 304
Construction Contract
00500-15
such surety is hereby given, and the said sureties hereby waive the provisions of Sections 2819 and 2845 of the Civil Code of the State of California.

SIGNED AND SEALED on .

APPROVED AS TO SURETY: By:

PRINCIPAL
SURETY
APPROVED AS TO FORM & CONTENT:

LORI ASUNCION

OFFICE OF THE CITY ATTORNEY
By:

ATTORNEY-IN-FACT
By:

ASSISTANT CITY ATTORNEY
EXHIBIT 2 305
Construction Contract
00500-16
EXHIBIT 2 306
General Conditions
00700-1
SECTION 00700 - GENERAL CONDITIONS

1.0 GENERAL

1.1 Intent of Contract Documents
The intent of the Contract Documents is to include all necessary criteria to establish the scope and quality for completion of the Work by Contractor. The Contract Documents are complementary and what is required by one shall be as binding as if required by all. Performance by the Contractor shall be required to the extent consistent with, and reasonably inferable from, the Contract Documents.

Where the Plans or Specifications describe portions of the Work in general terms but not in complete detail, it is understood that only the best general practice is to prevail and that only materials and workmanship of the first quality are to be used. Unless otherwise specified, the Contractor shall furnish tools, equipment, and incidentals, and do all the work involved in executing the Contract in a satisfactory and workmanlike manner.

In the event the materials and/or equipment are to be furnished by the City, as designated in the General Requirements or as agreed on, this shall not relieve the Contractor of the above requirements to furnish all other labor, materials, and equipment to complete the Contract.

It is the intent of the Contract Documents to describe a functionally complete Project (or part thereof) to be constructed in accordance with the Contract Documents. Any labor, documentation, services, materials, or equipment that may reasonably be inferred from the Contract Documents or from prevailing custom or trade usage as being required to produce the intended result will be provided whether or not specifically called for at no additional cost to the City.

1.2 Discrepancies and Omissions
Any discrepancies or omissions found in the Contract Documents shall be reported to the Construction Manager immediately. The Construction Manager will clarify discrepancies or omissions, in writing, within a reasonable time.

In the case of conflict or inconsistencies between terms of the Contract Documents, the following order of precedence shall apply:
a. The Contract and Exhibits, including change orders and permits; b. Supplementary Conditions and their Exhibits;
c. Instructions to Bidders;
d. General Conditions and their Exhibits;
e. The Project Specifications;
f. The Project Drawings;
g. City of Stockton Standard Specifications;
h. City of Stockton Standard Drawings;
EXHIBIT 2 307
General Conditions
00700-2
i. Where no order of precedence is stated, or if conflict or inconsistency cannot be resolved by a careful review of the Contract Documents, the more stringent of the requirements shown or specified shall be controlling.

Organization of the Specifications into various subdivisions and the arrangement of the Drawings shall not control Contractor in dividing the Work among subcontractors, in trades, or into design packages, or in establishing the extent of work to be performed by any trade.

Unless otherwise stated in the Contract Documents, technical words and abbreviations contained in the Contract Documents are used in accordance with commonly understood design professional and construction industry meanings; and non-technical words and abbreviations are used in accordance with their commonly understood meanings.

The Contract Documents may omit modifying words such as “all” and “any,” and articles such as “the” and “an,” but the fact that a modifier or an article is absent from one statement and appears in another is not intended to affect the interpretation of either statement. The use of the word “including,” when following any general statement, shall not be construed to limit such statement to specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation,” “but not limited to,” or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that could reasonably fall within the broadest possible scope of such general statement.

Whenever the context so requires, the use of the singular number shall be deemed to include the plural and vice versa. Each gender shall be deemed to include any other gender, and each shall include corporation, partnership, trust, or other legal entity, whenever the context so requires. The captions and headings of the various subdivisions of the Contract Documents are intended only for reference and convenience and in no way define, limit, or prescribe the scope or intent of the Contract Documents or any subdivision thereof.

1.3 Headings
Headings to parts, divisions, sections, articles, paragraphs, subparagraphs, and forms are inserted for convenience of reference only and shall not affect the interpretation of the Contract Documents.

1.4 Penalty for Collusion
If, at any time, it is found that the person, firm, or corporation to whom the Contract has been awarded has, in presenting any bid or bids, colluded with any other party or parties, then the Contract shall be null and void, and the Contractor and its sureties shall be liable for loss or damage which the City may suffer thereby, and the City may advertise for new bids for said Work.

1.5 Successors and Assigns
The City and the Contractor, respectively, bind themselves, their partners, successors, assigns, and legal representatives to the other party hereto and to the partners, successors, assigns, and legal representatives of such other party with respect to all covenants, agreements, and obligation contained in the Contract Documents. Neither party to the Contract shall assign the Contract or sublet it as a whole without the written consent of the other and consent of Surety.

EXHIBIT 2 308
General Conditions
00700-3

1.6 Assignment to City
Pursuant to Public Contract Code 7103.5, in entering into the Contract and all subcontracts, to supply goods, services, or materials pursuant to the Contract, the Contractor and its subcontractors offer and agree to assign to the City all rights, title, and interest in and to all causes of action it may have under Section 4 of the Clayton Act (15 U.S.C. Sec. 15) or under the Cartwright Act (Chapter 2 [commencing with Section 16700] of Part 2 of Division 7 of the Business and Professions Code), arising from purchases of goods, services, or materials pursuant to the Contract and subcontracts.

This assignment shall be made and become effective at the time the City tenders final payment to the Contractor, without further acknowledgment by the parties. Reference Paragraph 00100-23.

1.7 Rights and Remedies
The duties and obligations imposed by the Contract Documents and the rights and remedies available there under shall be in addition to, and not a limitation of, any duties, obligations, rights, and remedies otherwise imposed or available by law.

No action or failure to act by the City, the Design Consultant, or the Construction Manager shall constitute a waiver of any right or duty afforded any of them under the Contract, nor shall any such action or failure to act constitute an approval of or acquiescence in any breach there under, except as may be specifically agreed in writing.

2.0 ADMINISTRATION

2.1 Administration of the Contract
The City's Representative, the Construction Manager, and the Design Consultant will provide administration of the Contract as hereinafter discussed. The duties, responsibilities and limitations of authority of the Design Consultant and the Construction Manager as the representatives of the City during the construction, as set forth in the Contract Documents, will not be modified or extended without written consent of the City.

In case of the termination of the employment of the Design Consultant or the Construction Manager, the City shall appoint a Design Consultant or a Construction Manager whose status under the Contract Documents shall be that of the former Design Consultant or Construction Manager, respectively.

2.2 City's Representative

2.2.1 General - The City's Representative has the authority to act on behalf of the City to implement change orders, progress payments, contract performance decisions, acceptability of the Contractor's work, and early possession.

2.2.2 Change Orders - The City's Representative has the authority to review and recommend or reject change orders and cost proposals submitted by the Contractor or as recommended by the Construction Manager.

2.2.3 Progress Payments - The City's Representative has the authority to accept or reject requests for progress payments which have been submitted by the Contractor and recommended by the Construction Manager.

EXHIBIT 2 309
General Conditions
00700-4

2.2.4 Contract Performance Decisions - Should the Contractor disagree with the Construction Manager's decision with respect to the contract performance, the Contractor may appeal to the City's Representative in accordance with the provisions herein.

2.2.5 Acceptability of Work - The City's Representative has the authority to make the final determination of the acceptability of the Work. The City's Representative also has the authority to accept or reject the Design Consultant's recommendations regarding retention of defective work as provided.

2.3 Construction Management

2.3.1 General - The Construction Manager is a representative of the City employed to act as advisor and consultant to the City in construction matters related to the Contract.

All instructions to the Contractor and all communications from the Contractor to the City or the Design Consultant shall be forwarded through the Construction Manager. The Construction Manager will have authority to act on behalf of the City only to the extent provided in the Contract Documents. The City has delegated its authority to the Construction Manager to make initial decisions regarding questions which may arise as to the quality or acceptability of materials furnished and work performed, and as to the manner of performance and rate of progress of the work under the Contract. The Construction Manager shall interpret the intent and meaning of the Contract and shall make initial decisions with respect to the Contractor's fulfillment of the Contract and the Contractor's entitlement to compensation. The Contractor shall look initially to the Construction Manager in matters relating to the Contract.

The Construction Manager's authority to act under Paragraph 00700-2.1, Administration of the Contract, and any decision made by it in good faith either to exercise or not to exercise such authority shall not give rise to any duty or responsibility of the City or Construction Manager to the Contractor, any subcontractor, any of their agents or employees, or any other person performing any of the Work.

2.3.2 Representative - The Construction Manager will be represented at the Site by a resident construction manager or resident engineer who will observe the progress, quality, and quantity of the Work to determine, in general, if the Work is proceeding in accordance with the intent of the Contract Documents. The Construction Manager shall not be responsible for construction means, methods, techniques, sequences, or procedures, or for safety precautions and programs in connection with the Work.

In accordance with the provisions detailed elsewhere in these General Conditions, the Construction Manager will make decisions relative to all matters of interpretation or execution of the Contract Documents.

2.3.3 Inspection of Construction - The Construction Manager shall have the authority to reject work and materials which do not conform to the Contract Documents, and to require special inspection or testing in accordance with Paragraph 00700-5.3, Defective and Unauthorized Work.

In addition to the resident construction manager or resident engineer, the Construction Manager may employ one or more inspectors to observe the Work and to act in matters of construction under this Contract. An inspector is not authorized to revoke, alter, or waive any requirements of the Specifications. The inspector is authorized to call the attention of the Contractor to any failure of the Work, materials or workmanship to conform to the Contract Documents. The inspector shall have the authority to reject materials or, in any emergency, suspend the Work. The Contractor may appeal any such issue which it disagrees with to the Construction Manager for decision.

2.3.4 Acceptability of the Work - The Construction Manager has the authority to make a recommendation as to the acceptability of the Work.

EXHIBIT 2 310
General Conditions
00700-5

2.3.5 Change Orders - The Construction Manager has the authority to initiate change orders; to reject change orders proposed by the Contractor or Design Consultant; to negotiate and recommend acceptance of change orders; or to order minor changes in the Work at no cost to the City.

2.3.6 Construction Schedule - The Construction Manager has the authority to review and recommend acceptance of the progress schedule submitted by the Contractor at the start of the Work and subsequent significant revisions for conformance to the specified sequence of work and logic.

2.3.7 Progress Payments - The Construction Manager has the authority to recommend acceptance or rejection of requests for progress payments which have been submitted by the Contractor.

2.3.8 Final Payment - The Construction Manager, with the assistance of the Design Consultant will conduct inspections to determine the dates of substantial completion of the Work and final completion of the Work, and will receive and forward to the City, for the City's review, written warranties, and related documents required by the Contract and assembled by the Contractor.

2.3.9 Early Possession - The Construction Manager has the authority to recommend early possession.

2.4 Design Consultant

2.4.1 General - The Design Consultant will have the authority to act on behalf of the City only to the extent provided in the Contract Documents.

2.4.2 Interpretations - The Design Consultant has the authority to be the initial interpreter of the technical requirements of the Contract Documents. Either party to the Contract may make written request to the Construction Manager for interpretations necessary for the proper execution or progress of the Work. The Construction Manager shall refer such written requests to the Design Consultant, who will render such interpretations. Where the Contractor has requested an interpretation from the Construction Manager, or been notified by the Construction Manager that such interpretation has been requested by the City, any work done before receipt of such interpretations, if not in accordance with same, shall be removed and replaced or adjusted as directed by the Construction Manager without additional expense to the City.

2.4.3 Acceptability of the Work - The Design Consultant has the authority to make a recommendation as to the acceptability of the Work. The Design Consultant has the authority to recommend acceptance regarding the retention of defective work.

2.4.4 Site Observations - The Design Consultant may visit the Site at intervals appropriate to the stage of construction to become generally familiar with the progress and quality of the Work and to determine in general if the Work is proceeding in accordance with the Contract Documents.

However, the Design Consultant will not be required to make extensive or continuous on-site inspections to check the quality or quantity of the Work.

2.4.5 Submittal - The Contractor shall submit, through the Construction Manager, all shop drawings, product data and samples for review.

The Design Consultant has the authority to review and take other appropriate action upon the Contractor's submittals such as shop drawings, product data and samples, but only for conformance with the design concept of the Work and the information given in the Contract Documents.

3.0 CITY
EXHIBIT 2 311
General Conditions
00700-6

3.1 General
The City, acting through the City's Representative or the Construction Manager, shall have the authority to act as the sole judge of the Work and materials with respect to both quantity and quality as set forth in the Contract.

3.2 Attention to Work
The City shall notify the Contractor in writing of the name of the individual designated as the City's Representative and the name of the individual designated by the Construction Manager to act as resident construction manager or resident engineer. The Construction Manager's designated representative normally will be at the Site of the Work. During the representative's absences, the Contractor may contact a previously designated representative of the Construction Manager.

3.3 Inspection
In addition to the resident construction manager or resident manager or resident engineer, the City may employ one or more inspectors to observe the Work and to act in matters of construction under this Contract. An inspector is not authorized to revoke, alter, or waive any requirements of the specifications. The inspector is authorized to call the attention of the Contractor to any failure of the Work or materials to conform to the Contract Documents. The inspector shall have the authority to reject material or, in any emergency, suspend the Work. The Contractor may appeal any such issue with which it disagrees to the Construction Manager for decision by the Construction Manager.

Separate and independent from the inspection above, the project may be inspected by Building Officials for code compliance. Such inspectors shall have the authority provided to them by local jurisdiction.

Construction Manager will have authority to disapprove or reject Work which Construction Manager believes to be defective, or that Construction Manager believes will not produce a completed Project that conforms to the Contract Documents or that will prejudice the integrity of the design concept of the completed Project as a functioning whole as indicated by the Contract Documents.

Construction Manager will also have authority to require special inspection or testing of the Work as provided in this Section, whether or not the Work is fabricated, installed, or completed.

Contractor shall give Construction Manager timely notice of readiness of the Work for all required inspections, tests, or approvals and shall cooperate with inspection and testing personnel to facilitate required inspections or tests.

If Laws or Regulations of any public body having jurisdiction require any Work (or part thereof) specifically to be inspected, tested, or approved by an employee or other representative of such public body, Contractor shall assume full responsibility for arranging and obtaining such inspections, tests, or approvals, pay all costs in connection therewith, and furnish Construction Manager the required certificates of inspection or approval.

Contractor shall be responsible for arranging and obtaining and shall pay all costs in connection with any inspections, tests, or approvals required for City’s and Construction Manager‘s acceptance of materials or equipment to be incorporated in the Work; or acceptance of materials, mix designs, or equipment submitted for approval prior to Contractor's purchase thereof for incorporation in the Work. Such inspections, tests, or approvals shall be performed by organizations acceptable to the City and Construction Manager.

EXHIBIT 2 312
General Conditions
00700-7
If any Work (or the work of others) that is to be inspected, tested, or approved is covered by Contractor without written concurrence of Construction Manager, it must, if requested by Construction Manager, be uncovered for observation.

Uncovering Work shall be at Contractor's expense unless Contractor has given Construction Manager timely notice of Contractor's intention to cover the same and Construction Manager has not acted with reasonable promptness in response to such notice.

If any Work is covered contrary to the written request of Construction Manager, it must, if requested by Construction Manager, be uncovered for Construction Manager’s observation and replaced at Contractor's expense without adjustment of Contract Time or Contract Price.

If Construction Manager considers it necessary or advisable that covered Work be observed by Construction Manager or inspected or tested by others, Contractor, at Construction Manager’s request, shall uncover, expose, or otherwise make available for observation, inspection, or testing as Construction Manager may require, that portion of the Work in question, furnishing all necessary labor, material, and equipment. If it is found that such Work is defective, Contractor shall pay all Claims, costs, losses, and damages (including but not limited to all fees and charges of engineers, architects, attorneys, and other professionals and all court or arbitration or other dispute resolution costs) arising out of or relating to such uncovering, exposure, observation, inspection, and testing, and of satisfactory replacement or reconstruction (including but not limited to all costs of repair or replacement of work of others); and the City shall be entitled to an appropriate decrease in the Contract Price. If the parties are unable to agree as to the amount thereof, the City may make a Claim therefore as provided in these documents. If, however, such Work is not found to be defective, Contractor shall be allowed an increase in the Contract Price or an extension of the Contract Times (or Milestones), or both, directly attributable to such uncovering, exposure, observation, inspection, testing, replacement, and reconstruction. If the parties are unable to agree as to the amount or extent thereof, Contractor may make a Claim therefore as provided in these documents.

3.4 City's Right to Carry Out the Work
If the Contractor defaults or neglects to carry out the Work in accordance with the Contract Documents, and fails within 48 hours after receipt of written notice from the City to commence and continue correction of such default or neglect with diligence and promptness, the City may, after 48 hours following receipt by the Contractor of an additional written notice and without prejudice to any other remedy make good such deficiencies.

The City also reserves the right to perform any portion of the Work due to an emergency threatening the safety of the Work, public, City, and any property or equipment.

The Contractor is forewarned that in exercising the rights and remedies under this paragraph, the City shall proceed expeditiously. In connection with such corrective and remedial action, the City may exclude CONTRACTOR from all or part of the Site, take possession of all or part of the Work and suspend CONTRACTOR's services related thereto, take possession of CONTRACTOR's tools, appliances, construction equipment and machinery at the Site, and incorporate in the Work all materials and equipment stored at the Site or for which City has paid CONTRACTOR but which are stored elsewhere. CONTRACTOR shall allow the City, City's representatives, agents and employees, City's other contractors, and Construction Manager and Construction Manager's Consultants access to the Site to enable City to exercise the rights and remedies under this paragraph.

All Claims, costs, losses, and damages incurred or sustained by the City in exercising the rights and remedies under this paragraph 3.4 will be charged against CONTRACTOR, and a Change Order will be issued incorporating the necessary revisions in the Contract Documents with respect EXHIBIT 2 313
General Conditions
00700-8
to the Work; and City shall be entitled to an appropriate decrease in the Contract Price. If the parties are unable to agree as to the amount of the adjustment, City may make a claim therefor as provided in paragraph 7.5.2. Such claims, costs, losses and damages will include but not be limited to all costs of repair, or replacement of work of others destroyed or damaged by correction, removal, or replacement of CONTRACTOR's defective Work.

CONTRACTOR shall not be allowed an extension of the Contract Times (or Milestones) because of any delay in the performance of the Work attributable to the exercise by City of City's rights and remedies under this paragraph 3.4.

3.5 City's Right to Use or Occupy
The City reserves the right, prior to Substantial Completion, to occupy, or use, any completed part or parts of the Work, providing these areas have been approved for occupancy by the City. The exercise of this right shall in no way constitute an acceptance of such parts, or any part of the Work, nor shall it in any way affect the dates and times when progress payments shall become due from the City to the Contractor or in any way prejudice the City's rights in the Contract, or any bonds guaranteeing the same. The Contract shall be deemed completed only when all the Work contracted has been duly and properly performed and accepted by the City.

Prior to such occupancy or use, the City and Contractor shall agree in writing regarding the responsibilities assigned to each of them for payments, security, maintenance, heat, utilities, damage to the Work, insurance, the period for correction of the Work, and the commencement of warranties required by the Contract Documents.

In exercising the right to occupy or use completed parts of the Work prior to the Substantial Completion thereof, the City shall not make any use which will materially increase the cost to the Contractor, without increasing the Contract Amount, nor materially delay the completion of the Contract, without extending the time for completion.

The part or parts of the Work, if any, which the City anticipates the use or occupancy of prior to Substantial Completion, are noted in Paragraph 01010-7.0, Occupancy Requirements. Failure to include a part of the Work in the above Section, shall not limit the City's right to use or occupy parts of the Work not listed.

3.6 City's Right to Perform Work and to Award Separate Contracts The City reserves the right to perform the work related to the Project with the City's own forces, and to award separate contracts in connection with the Project or other work on the Site under these or similar General Conditions. If the Contractor claims that delay, damage, or additional cost is involved because of such action by the City, the Contractor shall make such claim as provided elsewhere in the Contract Documents.

When separate contracts are awarded for different portions of the Project or other work on the Site, the term "Contractor" in the Contract Documents in each case shall mean the Contractor who executes each separate Agreement.

The City will provide for the coordination of the work of the City's own forces and of each separate Contractor with the Work of the Contractor, who shall cooperate therewith as provided in Paragraph 00700-4.8.3, Cooperation.

EXHIBIT 2 314
General Conditions
00700-9

4.0 CONTRACTOR

4.1 Office
The Contractor's office at the Project Site is hereby designated as the legal address of the Contractor for the receipt of documents, samples, notices, letters, and other articles of communication.

4.2 Contractor's Representative
The Contractor shall notify the City in writing of the names of the persons who will act as the Contractor's representative and his or her designated alternate, and who shall have the authority to act in matters relating to this Contract. The Contractor, acting through its representative, shall give personal attention to, and shall manage the Work, so that it shall be prosecuted faithfully. The Contractor’s representative shall be an employee of the Contractor. Upon written request of the Contractor, this employment requirement may be waived by the City. The City's waiver, if granted, will be in writing. There is no obligation by the City to waive this provision regardless of the effect on the Contractor's operations. Such waiver may be rescinded by City upon reasonable written notice thereof.

At all times during the progress of the Work, the Contractor's representative shall be personally present at the Project site, or a designated alternate shall be at the Project site who has the authority to act in matters relating to the Contract. The Contractor's representative or designated alternate shall have the authority to carry out the provisions of the Contract and to supply materials, equipment, tools, and labor without delay for the performance of the Work. If neither the Contractor’s representative nor a designated alternate is at the Project site, the City acting through the Construction Manager shall have the authority as provided in Paragraph 00700-6.6, Temporary Suspension of Work, to suspend the work until such a representative is at the Project site.

Before initial work is begun on the Contract, the Contractor shall file, with the Construction Manager, addresses and telephone numbers where the Contractor's and all subcontractors' representatives can be reached during all hours, including nights and weekends when work is not in progress.

4.3 Construction Procedures
The Contractor will supervise and direct the work. The Contractor has the authority to determine the means, methods, techniques, sequences, and procedures of construction, except in those instances where the City, to define the quality of an item of work, specifies in the Contract, a means, method, technique, sequence, or procedure for construction of that item of Work.

4.4 Contractor's Employees
The Contractor shall be responsible for the adequacy, efficiency, and sufficiency of its employees.

Workers shall have sufficient knowledge, skill, and experience to perform properly the work assigned to them.

The Contractor shall employ only competent, skillful workers to perform the Work. If any subcontractor or person employed by the Contractor or its subcontractors, appear to the Construction Manager or City's Representative to be incompetent or act in a disorderly or improper EXHIBIT 2 315
General Conditions
00700-10
manner, such person or subcontractor shall be discharged from the site immediately by the Contractor upon written direction of the Construction Manager or City's Representative, and such person shall not again be employed on the Project.

4.5 Subcontractors
The Contractor shall give their personal attention to the fulfillment of the contract and shall keep the work under his control.

Subcontractors will not be recognized as having a direct relationship with the City. The persons engaged in the Work, including employees of subcontractors and suppliers, will be considered employees of the Contractor. The Contractor will be responsible for their work and their work shall be subject to the provisions of the Contract. The Contractor is as fully responsible to the City for the acts and omissions of its subcontractors and of persons either directly or indirectly employed by them as the Contractor is for the acts and omissions of persons directly employed by the Contractor. Nothing contained in the Contract Documents shall create any contractual relation between any subcontractor and the City. References in the Contract Document to actions required of subcontractors, manufacturers, suppliers, or any party other than the Contractor, the City, the Construction Manager, or the Design Consultant shall be interpreted as requiring that the Contractor shall require such subcontractor, manufacturer, supplier, utility company, or party to perform the specified action, unless the Contract Documents specifically state that the Work is not included in the Contract.

The Contractor shall not employ any subcontractors that are not properly licensed in accordance with State law. Prior to commencement of any work by a subcontractor, the Contractor shall submit verification to the Construction Manager that the subcontractor is properly licensed for the work it will perform. Changes to subcontractors listed in the Bid in accordance with Public Contract Code 4100 et. seq., shall be made only with the approval of the City.

4.6 Contractor's Equipment and Facilities
The Contractor shall furnish and maintain in good condition all equipment and facilities as required for the proper execution and inspection of the Work. Such equipment and facilities shall meet all requirements of applicable ordinances and laws.

4.7 Public Safety and Convenience
The Contractor shall conduct its work so as to ensure the least possible obstruction to traffic and inconvenience to the general public and the residents in the vicinity of the Work and to ensure the protection of persons and property at no extra cost to the City. The Contractor shall have under construction no greater length or amount of work than it can prosecute properly with due regard to the rights of the public.

4.8 City-Contractor Coordination
EXHIBIT 2 316
General Conditions
00700-11

4.8.1 Service of Notice - Notice, order, direction, request, or other communication given by the Construction Manager or City to the Contractor shall be deemed to be well and sufficiently given to the Contractor if delivered to the Contractor's Representative designated in Paragraph 00700-4.2, Contractor's Representative, to the Contractor's office designated in Paragraph 00700-4.1, Office, or to the Contractor's address provided in the Bid Proposal.

4.8.2 Suggestions to Contractor - Plans or methods of work suggested by the City, the Construction Manager, or the Design Consultant to the Contractor, but not specified or required, if adopted or followed by the Contractor in whole or in part, shall be used at the risk and responsibility of the Contractor. The City, and Construction Manager, or the Design Consultant assume no responsibility therefore, and in no way will be held liable for any defects in the Work which may result from or be caused by use of such plan or method of work.

4.8.3 Cooperation - The Contractor shall afford the City, the Construction Manager and separate contractors reasonable opportunity for the introduction and storage of their materials and equipment and the execution of their work, and shall connect and coordinate the Work with theirs as required by the Contract Documents.

If any part of the Contractor's Work depends for proper execution or results upon the work of the City or any separate contractor, the Contractor shall, prior to proceeding with the Work, promptly report to the Construction Manager any apparent discrepancies or defects in such other work that render it unsuitable for such proper execution and results. Failure of the Contractor to so report shall constitute an acceptance of the City's or separate contractor's work as fit and proper to receive the Work, except as to latent defects which subsequently become apparent in such work by others.

If requested by the Contractor, the City shall arrange meetings with other contractors performing work on behalf of the City to plan coordination of construction activities. The City shall keep the Contractor informed of the planned activities of other contractors.

Differences and conflicts arising between the Contractor and other contractors employed by the City or between the Contractor and the workers of the City with regard to their work, shall be submitted to the City for its decision in the matter. If such separate contractor sues the City on account of any delay or damage alleged to have been caused by the Contractor, the City shall notify the Contractor who shall, at the City's election, defend such proceedings at the Contractor's expense. If any judgment or award against the City arises from any such litigation whether defended by City or by Contractor, the Contractor shall pay or satisfy said judgment or award and shall reimburse the City for all attorney's fees and court costs which the City has incurred or for which it is liable.

4.9 Permits
Unless specifically stated to be provided by the City, Contractor shall apply for, obtain, and comply with all the terms, conditions and requirements attached to all permits, bonds and licenses required by local, state, or federal agencies to perform work, construct, erect, test and start up of any equipment or facility for this Contract. Permits shall be kept on-site. Where operating permits are required, the Contractor shall apply for and obtain such operating permits in the name of the City and provide the permit in an appropriate frame or file holder when the City accepts substantial completion of the equipment or facility. The Contractor shall give all notices necessary or incidental to the due and lawful prosecution of the work.

Any permits, bonds, licenses and fees therefore required for the performance of work under this Contract and not specifically mentioned herein as having been obtained and paid by the City shall be included in the Contractor's bid price.

EXHIBIT 2 317
General Conditions
00700-12
The Contractor shall be responsible for satisfying all code requirements. Any code inspections will be coordinated by the Construction Manager. The Contractor shall comply with all construction conditions stipulated in the permits.

The Contractor shall apply for and obtain all safety permits for excavations, tunneling, trenches, construction (building structure, scaffolding, or false work) and demolition required by CAL/OSHA including but not limited to, the permits required by Labor Code Section 6500.

The Environmental Quality Act of 1970 (Public Resources Code, Sections 21000 to 21176 incl.) may be applicable to permits, licenses and other authorizations which the Contractor must obtain from local agencies in connection with performing the work of the contract. The Contractor shall comply with the provisions of said statutes in obtaining such permits, licenses and other authorizations and they shall be obtained in sufficient time to prevent delays to the work.

In the event that the City has obtained permits, licenses or other authorizations, applicable to the work, in conformance with the requirements in said Environmental Quality Act of 1970, the Contractor shall comply with the provisions of said permits, licenses and other authorizations.

4.10 Contractor's Responsibility for the Work and Materials Until acceptance of the Work, the Contractor shall have the charge and care of the Work and of the materials to be used therein and shall bear the risk of injury, loss, or damage, to any part thereof (regardless of whether partial payments have been made on such damaged portions of the Work) by the action of the elements or from any other cause, whether or not arising from the non-execution of the Work. The Contractor shall rebuild, repair, restore, and make good all injuries, losses, or damages to any portion of the Work or the materials occasioned by any cause before its completion and acceptance and shall bear the expense thereof, except for such injuries, losses, or damages as are directly and proximately caused by acts of the City.

4.11 Laws to be Observed
The Contractor shall keep fully informed of all existing and future County, State, and National laws and regulations and all municipal ordinances and regulations of the City which in any manner affect those engaged or employed in the Work and of all such orders and decrees of bodies having any jurisdiction or authority over the same; and shall protect and indemnify the City and all of its officers, agents, and servants against any claim or liability arising from or based on the violation of any such laws, ordinances, regulations, orders, or decrees whether by the Contractor or its employees. If any discrepancy or inconsistency is discovered in the plans, drawings, specifications or Contract for the Work in relation to any such law, ordinance, regulations, order or decree, the Contractor shall immediately report the same to the Construction Manager in writing.

4.11.1 Prevailing Wage - The Contractor shall comply with Labor Code Sections 1774 and 1775. In accordance with said Section 1775, the Contractor shall forfeit, as a penalty to the City of Stockton, $25 for each calendar day or portion thereof, for each workman paid less than the prevailing rates as determined by the Director of Industrial Relations for such work or craft in which such workman is employed for any work done under the contract by him or by any subcontractor under him violation of the provisions of the Labor Code and, in particular, Labor Code Section 1770 and 1780, inclusive.

In addition to said penalty and pursuant to said Section 1775, the difference between such stipulated prevailing wage rates and the amount paid to each workman for each calendar day or EXHIBIT 2 318
General Conditions
00700-13
portion thereof for which each workman was paid less that the stipulated prevailing wage rate shall be paid to each workman by the Contractor.

Pursuant to provisions of Section 1773 of the Labor Code of the State of California, the City has obtained the general prevailing rate of wages (which rate includes employer payments for health and welfare, vacation, pension, travel time, and subsistence pay as provided for in Section 1773.8 of said Code, apprenticeship or other training programs authorized by Section 3093 of said code and similar purposes) applicable to the work to be done, for straight time, overtime, Saturday, Sunday and holiday work. The holiday wage rate listed shall be applicable to all holidays recognized in the collective bargaining agreement of the particular craft, classification or type of workman concerned. These wage rates are set forth in the Division of Industrial Relations publication entitled "General Prevailing Wage Rates", which is part of the Contract.

Pursuant to the provisions of Section 1773.2 of the Labor Code (as amended) the general prevailing wage rates for each craft, classification or type of workman are on file at the Municipal Utilities Department, 2500 Navy Drive, Stockton, California. A copy of said wage rates shall be posted by the Contractor in a prominent place at the site of the work.

The City will not recognize any claim for additional compensation because of the payment by the Contractor of any wage rate in excess of the prevailing wage rate set forth in the Contract. The possibility of wage increases is one of the elements to be considered by the Contractor in determining his bid, and will not under any circumstances be considered as the basis of a claim against the City on the Contract.

4.11.2 Travel and Subsistence Payments - Attention is directed to the requirements of Section 1773.8 of the Labor Code. The Contractor shall make travel and subsistence payment to each workman, needed to execute the work, in accordance with the requirements in said Section 1773.8.

4.11.3 Certified Payrolls - In accordance with Section 1776 of the Labor Code, each Contractor and subcontractor shall keep an accurate payroll record, showing the name, address, social security number, work classification, straight time, and overtime hours worked each day and week, and the actual per diem wages paid to each journeyman, apprentice, worker, or other employee employed by him or her in connection with the project.

The payroll records shall be certified and submitted to the City, and shall be available for inspection at all reasonable hours at the principal office of the Contractor on the following basis:
a. A certified copy of an employee's payroll record shall be made available for inspection or furnished to the employee or his or her authorized representative on request.
b. A certified copy of all payroll records shall be made available for inspection or furnished upon request to a representative of the City, the Division of Labor Standards Enforcement, and the Division of Apprenticeship Standards of the Department of Industrial Relations.
c. A certified copy of all payroll records shall be made available upon request by the public in accordance with Section 1776 of the Labor Code.

The Contractor is responsible for its and its subcontractors’ compliance with the provisions of Section 1776 of the Labor Code.

EXHIBIT 2 319
General Conditions
00700-14

4.11.4 Overtime Requirements - The Contractor shall forfeit, as a penalty to the City, the penalty as provided in the Labor Code for each worker employed in the execution of the Contract by the Contractor, or any subcontractor under the Contractor, for each day during which such worker is required or permitted to work more than eight (8) hours in any one day and forty (40) hours in any one week, in violation of the provisions of the Labor Code, and in particular, Section 1810 to Section 1815 thereof, inclusive, except that work performed by employees of Contractors in excess of eight (8) hours a day and forty (40) hours during one week, shall be permitted upon compensation for all hours worked in excess of eight (8) hours per day, at not less than one and a half (1½) times the basic rate of pay as provided for in the Labor Code.

4.11.5 Apprentice and Trainee - Attention is directed to the provisions in Section 1777.5 of the Labor Code and in accordance with the regulations of the California Apprenticeship Council concerning the employment of apprentices by the Contractor or any subcontractor under the Contractor.

Section 1777.5 requires the Contractor or subcontractors employing tradespersons in any apprenticeable occupation to apply to the joint apprenticeship committee nearest the site of the project which administers the apprenticeship program in that trade for a certificate of approval. The Contractor and subcontractors are required to submit contract award information to the applicable joint apprenticeship committee. As provided for in Section 1777.5 of the Labor Code, the Contractor is required to make contributions to funds established for the administration of apprenticeship programs.

It shall be the responsibility of the Contractor to abide by the provisions of Section 1777.5 of the Labor Code and to require all subcontractors employed by or contracting with the Contractor to abide by said provisions. The Contractor shall furnish the City any and all evidence of compliance with this Code Section when requested by the City.

It is City policy to encourage the employment and training of apprentices on public works contracts as may be permitted under local apprenticeship standards.

For failure to comply with Section 1777.5 of the Labor Code, the Contractor shall be subject to the penalties in Section 1777.7 of the Labor Code.

4.11.6 Workers' Compensation Insurance - The Contractor is required to secure the payment of compensation to its employees in accordance with the provisions of Sections 1860 and 3700 of the Labor Code and Paragraph 00820-2.4, Workers' Compensation Insurance.

4.11.7 Labor Discrimination - Attention is directed to Section 1735 of the Labor Code, which reads as follows:

No discrimination shall be made in the employment of persons upon public works because of race, religious creed, color, national origin, ancestry, physical handicap, medical condition, marital status, or sex of such persons, except as provided in Section 12940 of the Government Code, and every Contractor for public works violating this Section is subject to all the penalties imposed for a violation of this chapter.

Attention is also directed to the requirement in Section 1431 of the Labor Code and Sections 300 and 317 through 323 of Title 8 of the California Administrative Code that the Contractor shall submit his Equal Employment Opportunity Program and certification fee to the Fair Employment Practice Commission, in the event that the bid price for the contract exceeds $200,000.

4.11.8 Vehicle Code - Pursuant to the authority contained in Vehicle Code Section 591, the City has determined that within such areas as are within the limits of the project and are open to public EXHIBIT 2 320
General Conditions
00700-15
traffic, the following requirements of the Vehicle Code will apply: The lighting requirements in Section 25803; the brake requirements in Division 12, Chapter 3; the splash apron requirements in Section 27600; and, when operated on completed or existing treated base, surfacing, pavement or structures, except as otherwise provided in Section 7-1.02, "Weight Limitations," the weight limitation requirements contained in Division 15.

Attention is directed to the statement in said Section 591 that this Section shall not relieve him or any person from duty of exercising due care. The Contractor shall take all necessary precautions for safe operations of his equipment and the protection of the public from injury and damage from such equipment.

Any other requirements set forth in Division 11, 12, 13, 14 and 15 of the Vehicle Code which the Department, pursuant to the authority contained in Vehicle Code Section 591, will require compliance with, will be set forth in the special provisions.

4.11.9 Affirmative Action - Attention is directed to the requirements of the Stockton Municipal Code, Chapter 3, Part V, as amended with reference to the affirmative action requirements for Contractors on Public Works projects of the City of Stockton. Such requirements shall be followed. Guidelines and the necessary reporting requirements are contained in the publication entitled: "Affirmative Action Guidelines and Procedures For Respondents To A City of Stockton Request for Proposals" which is made a part of these specifications by this reference. Failure of the Contractor to conform to the provisions of the City of Stockton's Affirmative Action Program will result in his bid being rejected.

4.12 Safety

4.12.1 Contractor's Safety Responsibility - The Contractor shall be solely and completely responsible for conditions of the jobsite, including safety of all persons and property during performance of the work. This requirement shall apply continuously and not be limited to normal working hours. Safety provisions shall conform to U.S. Department of Labor (OSHA), the California Occupational Safety and Health Act, and all other applicable Federal, State, County, and local laws, ordinances, codes, the requirements set forth below, and any regulations that may be detailed in other parts of these Contract Documents. Where any of these are in conflict, the more stringent requirement shall be followed.

No provision of the Contract Documents shall act to make the City, the Construction Manager or any other party than the Contractor responsible for safety. The Construction Manager shall not have authority for safety on the project. The Contractor shall indemnify, defend and hold harmless the City, Construction Manager, or other authorized representatives of the City, from and against any and all actions, damages, fines, suits, and losses arising from the Contractor's failure to meet all safety requirements and/or provide a safe work site.

If death or serious injuries or serious damages are caused, the accident shall be reported immediately by telephone or messenger to both the Construction Manager and the City. In addition, the Contractor must promptly report in writing to the Construction Manager all accidents whatsoever arising out of, or in connection with, the performance of the Work whether on, or adjacent to, the Site, giving full details and statements of witnesses. The Contractor shall make all reports as are, or may be, required by any authority having jurisdiction, and permit all safety inspections of the work being performed under this Contract.

EXHIBIT 2 321
General Conditions
00700-16
If a claim is made by anyone against the Contractor or any subcontractor on account of any accident, the Contractor shall promptly report the facts in writing to the Construction Manager, giving full details of the claim.

4.12.2 Safety Program - The Contractor shall establish, implement, and maintain a written injury prevention program as required by Labor Code Section 6401.7. Before beginning the Work the Contractor shall prepare and submit to the Construction Manager a Contractor Safety Program that provides for the implementation of all of the Contractor's safety responsibilities in connection with the Work at the site and the coordination of that program and its associated procedures and precautions with safety programs, precautions and procedures of each of its subcontractors and other prime Contractors performing work at the site. The Contractor shall be solely responsible for initiating, maintaining, monitoring, coordinating, and supervising all safety program, precautions, and procedures in connection with the Work and for coordinating its programs, precautions, and procedures of the other prime contractors and subcontractors performing the Work at the site. The Safety Program should contain all the necessary elements for the Contractor to administer its program on site. At a minimum, this written Safety Program shall address the elements required by Labor Code Section 6401.7. The Contractor shall obtain a copy of the City's Municipal Utilities Department's Injury and Illness Prevention Program and the Safety Manual and incorporate appropriate safety procedures into their Safety Program. The Contractor shall also comply with the Department's "Contractor’s Safety Rules" in Section 01500-10.

The program shall also address the following:
a. Compliance with Laws, Rules, and Regulations
b. Infractions of Safety Rules

1. Reported to Contractor's designated Safety Supervisor

2. Time correction

3. Contractor to enforce safety requirements on its subcontractors

4. Non-complying employees to be removed from the Project c. Housekeeping

1. Continuous cleaning required

2. Final clean up required
d. Means of Implementing the Program

1. All new employees to receive training on the Contractor's Safety Program prior to starting work.

2. Periodic tool box meetings with agenda recorded.

3. Documented safety inspections by Safety Supervisor.

4. Establish emergency procedures and telephone numbers including the procedure for the immediate removal to a hospital or a doctor's care of persons who may be injured on the jobsite. The Contractor shall maintain at its office or other wellknown place at the Site safety equipment applicable to the Work as prescribed by the aforementioned authorities, and all items necessary for giving first aid to the injured.

EXHIBIT 2 322
General Conditions
00700-17

5. Project bulletin board with required policies.

6. At least two employees on each shift should have First Aid training and maintain a current First Aid card issued by an agency such as the American Red Cross.

7. Completion of a job hazard analysis for specific construction activities.

8. Establish a hazard communication program for informing the Contractor's and subcontractor's personnel, Construction Manager, City, and other affected parties of specific hazards on the project.

9. Establish a confined space entry program in accordance with Cal OSHA requirements.
e. Define the duties and responsibilities of Contractor management personnel for safety.

1. Project Manager

2. General Superintendent

3. Foreman

4. Safety Supervisor
f. Accident Investigation

1. Investigate all accidents and near misses.

2. Develop steps to prevent a reoccurrence.

3. Completion of all reporting paperwork.

The Contractor's compliance with requirements for safety and/or the Construction Manager's review of the Contractor's Safety Program shall not relieve or decrease the liability of the Contractor for safety. The Construction Manager's review of the Contractor's Safety Program is only to determine if the above listed elements are included in the program.

4.12.3 Safety Supervisor - The Contractor shall appoint an employee as safety supervisor who is qualified and authorized to supervise and enforce compliance with the Safety Program. The Contractor shall notify the Construction Manager in writing prior to the commencement of work of the name of the person who will act as the Contractor's safety supervisor and furnish the safety supervisor's resume to the Construction Manager.

The Contractor will, through and with his Safety Supervisor, ensure that all of its employees and its subcontractors of any tier, fully comply with the Project Safety Policies. The Safety Supervisor shall be a full-time employee of the Contractor whose responsibility shall include supervising compliance with applicable safety requirements on the work site and for developing and implementing safety training classes for all job personnel. The City shall have the authority to require removal of the Contractor's Safety Supervisor if the representative is judged to be improperly or inadequately performing the duties; however, this authority shall not in any way affect the Contractor's sole responsibility for performing this work safely, nor shall it impose any obligation upon the City to ensure the Contractor perform its work safely.

4.12.4 Safety Coordination Meetings - The Contractor and its affected subcontractors shall attend safety coordination meetings with the Construction Manager and any other affected parties. The meeting shall be held at least monthly and prior to the start of new construction activities.

EXHIBIT 2 323
General Conditions
00700-18
Construction activities will be reviewed prior to the start of work in the various areas to determine potential hazards. The Contractor will be responsible for preparing job hazard analyses to breakdown the activities to be performed in a step-by-step procedure and provide safety guidelines for each step and any special equipment necessary to protect workers. The Contractor will act as facilitator for the meeting. The Construction Manager will participate in the safety coordination meetings but will not direct the Contractor on how to perform its safety operations.

4.12.5 Safety and Protection - The Contractor shall take all necessary protection to prevent damage, injury, and loss to:
a. All employees on the Project, employees of all subcontractors, and other persons and organizations who may be affected thereby;
b. All the Work and materials and equipment to be incorporated therein, whether in storage on or off the site; and
c. Other property at the site or adjacent thereto, including trees, shrubs, lawns, walks, pavements, roadways, structures, utilities, and underground facilities not designated for removal, relocation, or replacement in the course of construction.

The Contractor shall comply with all applicable laws and regulations of any public body having jurisdiction for the safety of persons or property or to protect them from damage, injury or loss and shall erect and maintain all necessary safeguards for such safety and protection. The Contractor shall notify owners of adjacent property and of underground facilities and utility owners when prosecution of the Work may affect them and shall cooperate with them in the protection, removal, relocation, and replacement of their property. All injury or loss to any property caused, directly or indirectly, in whole or in part, by the Contractor, any subcontractor, supplier or any other person or organization directly or indirectly employed by any of them to perform or furnish any of the Work or anyone for whose acts any of them may be liable, shall be remedied by the Contractor.

4.12.6 Excavation Safety - In accordance with the provisions of Section 6705 of the Labor Code, the Contractor shall submit, in advance of excavation five feet or more in depth, detailed plans showing the design of shoring, bracing, sloping, or other provisions to be made for worker protection from hazard of caving ground during such excavation. If such plans vary from the shoring system standards set forth in the Construction Safety Orders in Title 8, California Code of Regulations, the plans shall be prepared and signed by a registered civil or structural engineer. Shoring, bracing, sloping, or other protective system shall not be less effective than required by the California Construction Safety Orders. The City's review of the Contractor's excavation plan is only for general conformance to the California Construction Safety Orders.

Prior to commencing any excavation, the Contractor shall designate in writing to the Construction Manager the "competent person(s)" with the authority and responsibilities designated in the Construction Safety Orders.

4.12.7 Safety Emergencies - In emergencies affecting the safety or protection of persons or the Work or property at the site or adjacent thereto, the Contractor, without special instruction or authorization from the Construction Manager, is obligated to act to prevent threatened damage, injury or loss.

The Contractor shall give the Construction Manager prompt written notice if the Contractor believes that any significant changes in the Work or variations from the Contract Documents have been caused thereby.

EXHIBIT 2 324
General Conditions
00700-19

4.12.8 Safety Violations - Should the Contractor fail to correct an unsafe condition, the Construction Manager shall immediately notify the City of the Contractor's failure to correct the unsafe condition.

The City shall then notify the Contractor through the Construction Manager that the unsafe condition must be corrected or the work in question will be stopped in accordance with Paragraph 00700-6.6, Temporary Suspension of Work until the condition is corrected to the satisfaction of the City. No extension of time or additional compensation will be granted as a result of any stop order so issued. The notification and suspension of such work or the failure to provide such notification and suspension by the Construction Manager and City shall not relieve the Contractor of its sole responsibility and liability for safety.

The City shall have the authority to require the removal from the project of the foreman and/or superintendent in responsible charge of the work where safety violations occur.

4.12.9 Equipment Safety Provisions - The completed Work shall include all necessary permanent safety devices, such as machinery guards and similar ordinary safety items, required by the State and Federal (OSHA) industrial authorities and applicable local and national codes. Further, any features of the Work, including City-selected equipment, subject to such safety regulations shall be fabricated, furnished, and installed in compliance with these requirements. All equipment furnished shall be grounded and provided guards and protection as required by safety codes. Where vaportight or explosion-proof electrical installation is required by safety codes, this shall be provided.

Contractors and manufacturers of equipment shall be held responsible for compliance with the requirements included herein. The Contractor shall notify all equipment suppliers and subcontractors of the provisions of this paragraph.

4.12.10 Hazard Communication Programs- Contractor shall be responsible for coordinating any exchange of material safety data sheets or other hazard communication information required to be made available to or exchanged between or among employers at the Site in accordance with Laws or Regulations.

4.13 Review of Contract Documents and Field Conditions by Contractor; Single Point Responsibility of Contractor - In addition to the examination and reviews performed, and obligations assumed, incidental to making the representations set forth in the Contract, Contractor shall carefully study and compare each of the Contract Documents with the others and with information furnished by City, and shall promptly report in writing to City’s Representative any errors, inconsistencies, or omissions in the Contract Documents or inconsistencies with applicable code requirements observed by Contractor. Contractor shall determine the most desirable method of achieving City’s requirements in terms of cost, technology, quality and speed of delivery.

Contractor is responsible for the construction of the Project and shall provide all services pursuant to this Contract in a manner consistent with the standard of care under California law applicable to those who specialize in providing such services for projects of the type, scope, and complexity of the Project (including its contracting mode). Contractor shall perform its construction services in accordance with the best practices applicable to Contractor’s field ordinarily used by member of construction industry in the location where the services are to be performed. Contractor shall take field measurements, verify field conditions, and carefully compare with the Contract Documents such field measurements, conditions, and other information known to Contractor before commencing the Work. Errors, inconsistencies, or omissions discovered at any time shall be promptly reported in writing to City’s Representative.

If Contractor performs any construction activity which it knows, or should know, involves an error, inconsistency, or omission in relation to the Contract Documents, without notifying and obtaining the written consent of City, Contractor shall be responsible for the resultant losses, including, without limitation, the costs of correcting Defective Work.

Contractor agrees that it has single point responsibility for the construction of this Project.

EXHIBIT 2 325
General Conditions
00700-20

4.14 Supervision and Construction Procedures - Contractor shall supervise, coordinate, and direct the Work using Contractor’s best skill and attention. Contractor shall be solely responsible for, and have control over construction means, methods, techniques, sequences, procedures, and the coordination of all portions of the Work, including, but without limitation, landscape and site work, utilities, and building systems.

Contractor shall be responsible to City for acts and omissions of Contractor’s agents, employees, and subcontractors, of all tiers, and their respective agents and employees.

Contractor shall not be relieved of its obligation to perform the Work in accordance with the Contract Documents either by acts or omissions of City or City’s Representative in the administration of the Contract, or by tests, inspections, or approvals required, or performed, by persons or firms other than Contractor.

Contractor shall be responsible for inspection of all portions of the Work, including those portions already performed under this Contract, to determine that such portions conform to the requirements of the Contract Documents and are ready to receive subsequent Work.

Contractor shall at all times participate in, and implement, the CEQA and NEPA mitigation processes and ensure performance as required in the Contract Documents.

Contractor shall at all times maintain good discipline and order among its employees and subcontractors. Contractor shall provide competent, fully qualified personnel to perform the Work.

4.15 Labor And Materials - Unless otherwise provided in the Contract Documents, Contractor shall provide and pay for all services, other services, labor, materials, equipment, tools, construction equipment and machinery, water, heat, utilities, transportation, and other things necessary for proper execution and completion of the Work, whether temporary or permanent and whether or not incorporated or to be incorporated in the Work.

5.0 CONTROL OF WORK AND MATERIALS

5.1 Means and Methods
It is expressly stipulated that the drawings, specifications and other Contract Documents set forth the requirements as to the nature of the completed Work and do not purport to control the method of performing work except in those instances where the nature of the completed Work is dependent on the method of performance.

Except as provided elsewhere in the Contract Documents, neither the City, Design Consultant nor the Construction Manager will be responsible for or have control or charge of construction means, methods, techniques, sequences or procedures, or for safety precautions and programs in connection with the Work. Except as provided elsewhere in the Contract Documents, neither the City, Design Consultant nor the Construction Manager will be responsible for or have control or charge over the acts or omissions of the Contractor, or any of their subcontractors, agents or employees, or any other persons performing any of the Work. Any general control of the Work exercised by the City or its authorized representatives shall not make the Contractor an agent of the City, and the liability of the Contractor for all damages to persons and/or to public or private property arising from the Contractor's execution of the Work shall not be lessened because of such general control.

Neither the inspection by the City, Design Consultant, or Construction Manager, nor any order, measurement, approved modification, or payment of monies, nor acceptance of any part or whole EXHIBIT 2 326
General Conditions
00700-21
of the Work by the City, Design Consultants, Construction Manager, or their agents shall operate as a waiver of any provision of the Contract.

Acceptance by the Construction Manager, City and/or Design Consultant of any drawings, or any information regarding materials and equipment the Contractor proposes to furnish or method of work shall not be regarded as an assumption of risks or liability by the Construction Manager, Design Consultant, or the City, or any officer or employee thereof, and the Contractor shall have no claim under the Contract on account of the failure or partial failure or inefficiency or insufficiency of any plan or method of work or material and equipment so accepted. Such acceptance shall be considered to mean merely that the Construction Manager, City, and/or Design Consultant has no objection to the Contractor using, upon its own full responsibility, the plan or method of work proposed, or furnishing the materials and equipment proposed.

5.2 City-Furnished Materials
Materials, if furnished by the City, will be made available as designated in the General Requirements. The cost of loading, unloading, hauling and handling, and placing City-furnished materials shall be considered as included in the price bid for the Contract item involving such City-furnished material.

Contractor shall inspect and assure itself of the amount and soundness of such materials.

The Contractor will be held responsible for all materials furnished to it, and shall pay all demurrage and storage charges. City-furnished materials lost or damaged from any cause whatsoever shall be replaced by the Contractor. The Contractor will be liable to the City for the cost of replacing City-furnished material and such costs may be deducted from any monies due or to become due the Contractor.

5.3 Defective and Unauthorized Work
Materials and workmanship not conforming to the requirements of the Contract Documents shall be considered defective and will be subject to rejection. Defective work or material, whether in place or not, shall be removed immediately from the Site by the Contractor, at its expense, when so directed by the Construction Manager.

Any work done beyond the limits of work, lines, and grades shown on any approved plans or established by the Construction Manager, or any extra work done without written authority, will be considered as unauthorized and will not be paid for.

Upon failure on the part of the Contractor to comply with any order of the Construction Manager made under the provisions of this paragraph, the Construction Manager shall have authority to require special inspection and testing to verify if work is defective. Confirmed defective work shall be remedied, or removed and replaced, and unauthorized work be removed. The costs thereof will be deducted from any monies due or to become due the Contractor. The time, cost and compliance requirements stipulated in Paragraph 00700-3.4, City's Right to Carry Out the Work, shall apply for this paragraph also.

5.4 Unnoticed Defects
Any defective work or material that may be discovered by the City, Construction Manager, or Design Consultant before the final acceptance of the Work, or before final payment has been made, EXHIBIT 2 327
General Conditions
00700-22
or during the warranty period, shall be removed and replaced by work and materials which shall conform to the provisions of the Contract Documents. Failure on the part of the City, Construction Manager, or Design Consultant to condemn or reject bad or inferior work or materials shall not be construed to imply acceptance of such work or materials.

5.5 Right to Retain Imperfect Work
If any part or portion of the work performed or material furnished under this Contract shall prove defective and not in accordance with the Drawings and Specifications, and if the imperfection in the same shall not be of sufficient magnitude or importance as to make the work dangerous or unsuitable, or if the removal of such work will create conditions which are dangerous or undesirable, the City shall have the right and authority to retain such work but shall make such deductions in the final payment therefore as may be just and reasonable.

6.0 PROGRESS OF THE WORK

6.1 Beginning of Work
The Contractor shall begin work within ten (10) days of the effective date of the Notice to Proceed and shall diligently prosecute the same to completion within the time limit.

Should the Contractor begin work in advance of receiving Notice to Proceed, any work performed in advance of the said date of approval shall be considered as having been done by the Contractor at its own risk and as a volunteer.

6.2 Time of Completion
Time shall be of the essence of the Contract. The Contractor shall prosecute the work so that the various portions of the project shall be complete and ready for use within the time specified in Paragraph 01010-3.0, Time Allowed for Completion. It is expressly understood and agreed by and between the Contractor and the City that the Contract time for completion of the work described herein is a reasonable time taking into consideration the average climatic and economic conditions and other factors prevailing in the locality and the nature of the work.

6.3 Delays

6.3.1 Notice of Delays - When the Contractor foresees a delay in the prosecution of the Work and, in any event, immediately upon the occurrence of a delay, the Contractor shall notify the Construction Manager in writing of the probability of the occurrence and the estimated extent of the delay, and its cause. The Contractor shall take immediate steps to prevent, if possible the occurrence or continuance of the delay. The Contractor agrees that no claim shall be made for delays which are not called to the attention of the Construction Manager at the time of their occurrence.

6.3.2 Non-excusable Delays - Non-excusable delays in the prosecution of the Work shall include delays which could have been avoided by the exercise of care, prudence, foresight, and diligence on the part of the Contractor or its subcontractors, at any tier level, or suppliers.

EXHIBIT 2 328
General Conditions
00700-23

6.3.3 Excusable Delays - Excusable delays in the prosecution or completion of the Work shall include delays which result from causes beyond the control of the Contractor and City and which could not have been avoided by the exercise of care, prudence, foresight, and diligence on the part of the Contractor or its subcontractors, at any tier level, or suppliers.

6.3.3.1 Abnormal Delays - Delays caused by acts of god, fire, unusual storms, floods, tidal waves, earthquakes, strikes, labor disputes, and freight embargoes, shall be considered as excusable delays insofar as they prevent the Contractor from proceeding with at least seventy-five (75) percent of the normal labor and equipment force for at least five (5) hours per day toward completion of the current critical activity item(s) on the latest favorably reviewed progress schedule.

6.3.3.2 Weather Delays - Should inclement weather conditions or the conditions resulting from weather prevent the Contractor from proceeding with seventy-five (75) percent of the normal labor and equipment force engaged in the current critical activity item for a period of at least five (5) hours per day toward completion of such operation or operations, and the crew is dismissed as a result thereof, it shall be a weather delay day. The Contractor may be granted a time extension pursuant to Paragraph 00700-6.4.2.c, Weather Delays.

6.3.3.3 Material Shortages - Upon the submission of satisfactory proof to the Construction Manager by the Contractor, shortages of material may be acceptable as grounds for granting a time extension. In order that such proof may be satisfactory and acceptable to the Construction Manager, it must be demonstrated by the Contractor that the Contractor has made every effort to obtain such materials, or obtain acceptable substitute materials, from all known sources within reasonable reach of the proposed Work. Only the physical shortage of material, caused by unusual circumstances, will be considered under these provisions as a cause for extension of time, and no consideration will be given to any claim that material could not be obtained at a reasonable, practical, or economical cost or price, unless it is shown to the satisfaction of the Construction Manager that such material could have been obtained only at exorbitant prices entirely out of line with current rates, taking into account the quantities involved and usual practices in obtaining such quantities. A time extension for shortage of material will not be considered for material ordered or delivered late or whose availability is affected by virtue of the mishandling of procurement. The above provisions apply equally to equipment to be installed in the work.

6.3.4 Compensable Delays - Compensable delays in the prosecution or completion of the Work shall include delays that occur through no fault of the Contractor and prevent the Contractor from proceeding with at least seventy-five (75) percent of the normal labor and equipment force for at least five (5) hours per day toward completion of the current critical activity item(s) on the latest favorably reviewed progress schedule due to the following cause(s):
a. Delays due solely to the actions and/or inactions of the City. b. Delays due to differing site conditions as defined in Paragraph 00700-7.3, Differing Site Conditions.
c. Delays due to other Contractors employed by the City who interfere with the Contractor's prosecution of the Work as defined above.

No delay shall be compensable unless the claimed event or occurrence delays completion of the work beyond the contractual completion date or the completion date shown in the accepted initial or updated schedules, and the delay affects a critical activity while such activity is on the critical path.

6.3.5 Concurrent Delays - Concurrent delays are those delay periods when the prosecution of the Work is delayed during the same period of time due to causes from a combination of the delays defined in Paragraphs 00700-6.3.2, Non-Excusable Delays, 00700-6.3.3, Excusable Delays, or 00700-

6.3.4, Compensable Delays. During such concurrent delay periods, time extensions will be granted in accordance with Paragraph 00700-6.4, Time Extensions; however, the Contractor shall not be compensated for its delay damages as defined in Paragraph 00700-6.4.3, or for any other EXHIBIT 2 329
General Conditions
00700-24
damages, and the City shall not assess its actual costs as defined in Paragraph 00700-6.4.1, Nonexcusable Delays.

6.4 Time Extensions

6.4.1 Non-excusable Delays - The City may grant an extension of time for non-excusable delays if the City deems it is in its best interest. If the City grants an extension of time for non-excusable delays, the Contractor agrees to pay the City's actual costs, including charges for engineering, inspection and administration incurred during the extension.

6.4.2 Excusable or Compensable Delays - If the Contractor is delayed in the performance of its work as defined in Paragraphs 00700-6.3.3, Excusable Delays, or 00700-6.3.4, Compensable Delays, then the Contract completion date may be extended by the City for such time that, in the City's and Construction Manager's determination, the Contractor's completion date will be delayed, provided that the Contractor strictly fulfills the following:
a. The Contractor shall provide notification, in accordance with Paragraph 00700-6.3.1, Notice of Delays, and submit in writing a request for an extension of time to the Construction Manager stating at a minimum the probable cause of the delay and the number of days being requested. The time extension request shall be submitted in accordance with the requirements of Paragraph 01310-4.0, Time Impact Analyses. b. If requested by the Construction Manager, the Contractor shall promptly provide sufficient information to the Construction Manager to assess the cause or effect of the alleged delay, or to determine if other concurrent delays affected the work. c. Weather Delays. The Contractor will be granted a non-compensable time extension for weather caused delays, pursuant to Paragraph 00700-6.3.3.2, Weather Delays, over and above an allowance as provided for in Paragraph 01010-5.0, Weather Days. No time extensions for weather delays will be granted until the total number of weather days exceeds this allowance.

Should the Contractor fail to fulfill any of the foregoing, which are conditions precedent to the right to receive a time extension, the Contractor waives the right to receive a time extension.

During such extension of time, neither extra compensation for engineering, inspection and administration nor damages for delay will be charged to the Contractor. It is understood and agreed by the Contractor and City that time extensions due to excusable or compensable delays will be granted only if such delays involve controlling operations which would prevent completion of the whole Work within the specified Contract time.

Should the Contractor fail to complete the work within the time specified in the contract, as extended in accordance with this clause if appropriate, the Contractor shall pay to the City liquidated damages in accordance with Paragraph 00700-6.5, Liquidated Damages.

6.4.3 Delay Damages

6.4.3.1 Indirect Overhead - The Contractor shall be reimbursed for indirect overhead expenses for periods of time when the Work is delayed as defined in Paragraph 00700-6.3.4, Compensable Delays.

However, no reimbursement for indirect overhead or any other costs or damages shall be made for compensable delays which occur during a concurrent delay as defined in Paragraph 00700-6.3.5, Concurrent Delays. No reimbursement for indirect overhead as covered in this Section shall be made for any time extensions granted for Contract change orders as provided in Section 01035, EXHIBIT 2 330
General Conditions
00700-25
Modification Procedures. As a condition precedent to any reimbursement, the Contractor must fulfill all conditions as provided in Paragraph 00700-6.4.2, Excusable or Compensable Delays. No additional markup for overhead or profit shall be provided for such indirect overhead expenses.

Payment to the Contractor for indirect overhead expenses will be made only if the extended Contract period granted for the compensable delay(s) is required to complete the work following the depletion of the original contract period and any time extensions granted other than compensable time extensions. Except as provided herein, the Contractor shall have no claim for damage or compensation for any delay including not limited to extended field costs, extended home office overhead costs, impact, inefficiency, unabsorbed home office overhead, underabsorbed home office overhead, hindrance, disruption, or any other damage arising from delay, no matter how characterized, including delay claims of its subcontractors/suppliers of every tier.

6.4.3.1.1 Indirect Field Overhead - For those allowable delay periods as defined in Paragraph 00700-6.4.3, Indirect Overhead, the Contractor shall be reimbursed for its indirect field overhead based on:
a. Invoices for all field office equipment.
b. Actual salary for field office staff.
c. Fair rental values acceptable to the Construction Manager as described in Paragraph 01035-

3.0, Force Account Payment for construction equipment idled due to the delay.

6.4.3.1.2 Indirect Home Office Overhead - For those allowable delay periods as defined in Paragraph 00700-

6.4.3, Indirect Overhead, the Contractor shall be reimbursed for its daily home office overhead based on the following formula:

Contract Bid Price ($) X (0.04) = Daily Home Office Overhead ($/Day) Contract Period (Days)
As it is impractical to determine the actual home office overhead, such reimbursement shall be mutually agreed between the City and Contractor to encompass full payment for any home office overhead expenses for such periods of time for the Contractor and all subcontractors.

The Contractor agrees to indemnify, defend and hold the City harmless for any indirect overhead claims from its subcontractors.

6.5 Liquidated Damages
It is agreed by the parties to the Contract that time is of the essence in the completion of this Work, and that in case all the Work called for under the Contract is not completed before or upon the expiration of the time limit as set forth in these Contract Documents, as modified by extensions of time granted by the City, damage will be sustained by the City. As it is impracticable to determine the actual delay damage; it is, therefore, agreed that the Contractor shall pay liquidated damages to the City in the amount set forth in Paragraph 01010-4.0, Damages For Delays, per day for each and every day's delay beyond the time prescribed to complete the Work. The Contractor agrees to pay such liquidated damages and in case the same are not paid, agrees that the City may deduct the amount thereof from any monies due or that may become due the Contractor under the Contract.

6.6 Termination By City For Cause
EXHIBIT 2 331
General Conditions
00700-26
Subject to prior notice from City and Contractor’s cure rights set forth in this Section, City will have the right to terminate the Contract for cause after the occurrence of any of the following events:
a. Contractor becomes insolvent or files for relief under the bankruptcy laws of the United States.
b. Contractor makes a general assignment for the benefit of its creditors or fails to pay its debts as the same become due.
c. A receiver is appointed to take charge of Contractor’s property. d. The Work is not completed with the applicable Contract Time, as such Contract Time may be adjusted in accordance with this Contract, and Contractor is not diligently prosecuting the completion or correction of the Work.
e. Contractor persistently or repeatedly refuses or fails to supply skilled supervisory personnel, an adequate number of properly skilled workers, proper materials, or necessary equipment to prosecute the Work in accordance with the Contract Documents. f. Contractor fails to make prompt payment of amounts properly due subcontractors after receiving payment from City.
g. Contractor disregards Applicable Code Requirements.
h. Contractor persistently or materially fails to execute the Work in accordance with the Contract Documents.
i. Contractor persistently or materially fails to comply with applicable safety requirements. j. Contractor abandons the Work.
k. Contractor is in default of any other material obligation under the Contract Documents.

Upon the occurrence of any of the preceding events, City will have the right to terminate the Contract for cause if Contractor fails to promptly commence to cure such default and diligently prosecute such cure within 5 days after notice from City, or within such longer period of time as is reasonably necessary to complete such cure.

Upon any of the occurrences referred to above, City may, at its election and by notice to Contractor, terminate the Contract and take possession of the Project site and all materials, supplies, equipment, tools, and construction equipment and machinery thereon owned by Contractor; accept the assignment of any or all of the subcontracts; and then complete the Work by any method City may deem expedient. If requested by City, Contractor shall remove any part or all of Contractor’s materials, supplies, equipment, tools, and construction equipment and machinery from the Project site within 7 days of such request; and if Contractor fails to do so, City may remove or store, and after 90 days sell, any of the same at Contractor’s expense.

If the Contract is terminated by City as provided in this Section, Contractor shall not be entitled to receive any further payment until the expiration of 35 days after Final Completion and acceptance of all Work by City.

If the unpaid balance of the Contract Sum exceeds the cost of completing the Work, including all additional costs and expenses made necessary thereby, including costs for City staff time, plus all losses sustained, including any liquidated damages provided under the Contract Documents and subject to provisions of this Contract that survive termination, such excess shall be paid to EXHIBIT 2 332
General Conditions
00700-27
Contractor. If such costs, expenses, losses, and liquidated damages exceed the unpaid balance of the Contract Sum, Contractor shall pay such excess to City.

No termination or action taken by City after termination shall prejudice any other rights or remedies of City provided by law or by the Contract Documents upon such termination; and City may proceed against Contractor to recover all losses suffered by City.

6.7 Suspension By City For Convenience
City may, at any time and from time to time, without cause, order Contractor, in writing, to suspend, delay, or interrupt the Work in whole or in part for such period of time, up to 90 days, as City may determine, with such period of suspension to be computed from the date of delivery of the written order. Such order shall be specifically identified as a “Suspension Order” under this Section. The Work may be stopped for such further period as the parties may agree. Upon receipt of a Suspension Order, Contractor shall, at City’s expense, comply with its terms and take all reasonable steps to minimize costs allocable to the Work covered by the Suspension Order during the period of Work stoppage. Within 90 days after the issuance of the Suspension Order, or such extension to that period as is agreed upon by Contractor and City, City shall either cancel the Suspension Order or delete the Work covered by such Suspension Order by issuing a Change Order.

If a Suspension Order is canceled or expires, Contractor shall continue with the Work. A Change Order will be issued to cover any adjustments of the Contract Sum or the Contract Time necessarily caused by such suspension. Any Claim by Contractor for an adjustment of the Contract Sum or the Contract Time shall be made within 21 days after the end of the Work suspension. Contractor agrees that submission of its claim within said 21 days is an express condition precedent to its right to recover on such a claim.

The provisions of this Section shall not apply if a Suspension Order is not issued by City. A Suspension Order shall not be required to stop the Work as permitted or required under any other provision of the Contract Documents.

6.8 Termination By City For Convenience
City may, at its option, terminate this Contract, in whole or from time to time in part, at any time by giving notice to Contractor. Upon such termination, Contractor agrees to waive any claims for damages, including loss of anticipated profits, on account thereof; and, as the sole right and remedy of Contractor, City shall pay Contractor in accordance with this Section.

Upon receipt of notice of termination under this Section, Contractor shall, unless the notice directs otherwise, do the following:
a. Immediately discontinue the Work to the extent specified in the notice. b. Place no further orders or subcontracts for materials, equipment, services, or facilities, except as may be necessary for completion of such portion of the Work as is not discontinued.

EXHIBIT 2 333
General Conditions
00700-28
c. Promptly cancel, on the most favorable terms reasonably possible, all orders and subcontracts to the extent they relate to the performance of the discontinued portion of the Work.
d. Thereafter do only such Work as may be necessary to preserve and protect Work already in progress and to protect materials, plants, and equipment on the Project site or in transit thereto.

Upon such termination, the obligations of the Contract shall continue as to portions of the Work already performed and, subject to Contractor’s obligations under this Section above, as to bona fide obligations assumed by Contractor prior to the date of termination.

Upon such termination, City shall pay to Contractor the sum of the following:
a. The amount of the Contract Sum allocable to the portion of the Work properly performed by Contractor as of the date of termination, less sums previously paid to Contractor. b. Plus previously unpaid costs of any items delivered to the Project site which were fabricated for subsequent incorporation in the Work.
c. Plus any proven losses with respect to materials and equipment directly resulting from such termination.
d. Plus reasonable demobilization costs.
e. Plus reasonable costs of preparing a statement of the aforesaid costs, expenses, and losses in connection with such termination. The above payment shall be the sole and exclusive remedy to which Contractor is entitled in the event of termination of the Contract by City pursuant to this Section; and Contractor will be entitled to no other compensation or damages and expressly waives same.

6.9 Temporary Suspension of Work

6.9.1 If the Contractor fails to correct defective work as required by Paragraph 00700-5.3, Defective and Unauthorized Work, or fails to carry out the Work in accordance with the Contract Documents or any other applicable rules and regulations, the City, by a written order of the City's representative or signed personally by an agent specifically so empowered by the City, in writing, may order the Contractor to stop the work, or any portion thereof, until the cause for such order has been eliminated; however, this right of the City to stop the Work shall not give rise to any duty on the part of the City to exercise this right for the benefit of the Contractor or any other person or entity. All delays in the Work occasioned by such stoppage shall not relieve the Contractor of any duty to perform the Work or serve to extend the time for its completion. Any and all necessary corrective work done in order to comply with the Contract Documents shall be performed at no cost to the City.

6.9.2 In the event that a suspension of Work is ordered, as provided in this paragraph, the Contractor, at its expense, shall perform all work necessary to provide a safe, smooth, and unobstructed passageway through construction for use by public, pedestrian, and vehicular traffic, during the period of such use by suspension. Should the Contractor fail to perform the Work as specified, the City may perform such work and the cost thereof may be deducted from monies due the Contractor under the Contract.

6.9.3 The City shall also have authority to suspend the Work wholly or in part, for such period as the City may deem necessary, due to unsuitable weather, or to such other conditions as are considered EXHIBIT 2 334
General Conditions
00700-29
unfavorable for the suitable prosecution of the Work. Such temporary suspension of the Work will be considered justification for time extensions to the Contract in an amount equal to the period of such suspension if such suspended work includes the current critical activity on the latest favorably reviewed progress schedule. The Contractor as directed by the City shall provide the provisions as stipulated in Paragraph 00700-6.6.2 above. Such additional work shall be compensated as provided for in Paragraph 00700-7.0, Changes in The Work.

7.0 SCOPE OF WORK - CHANGES IN THE WORK

7.1 Changes
The City reserves the right to make such alterations, deviations, additions to, deletions or omissions from the plans and specifications, including the right to increase or decrease the quantity of any item or portion of the work, as may be deemed by the Engineer to be necessary or advisable and to require such extra work as may be determined by the Engineer to be required for the proper completion or construction of the whole work contemplated. Such changes, no matter how many, shall be within the contemplation of this Contract and shall not be the basis for a compensable delay or a claim for lost profits.

Any such changes will be set forth in a contract change order which will specify, in addition to the work to be done in connection with the change made, adjustment of contract time, if any, and the basis of compensation for such work. A contract change order will not become effective until approved by the authorized City official and/or the City Council.

For contracts approved by the City Council for initial prices under One Hundred Thousand Dollars ($100,000), cumulative change orders which exceed the charter limit $100,000 require City Council approval. For contracts with initial prices of One Hundred Thousand Dollars ($100,000) or more, cumulative change orders which exceed the charter limit $100,000 plus ten percent (10%) of the initial contract price over One Hundred Thousand Dollars ($100,000) require City Council approval.

Change orders not meeting the above criteria require approval by the authorized City official executing this Contract. The dollar amounts of change orders approved by specific City Council action, plus the dollar amounts of any change orders which predate such specific City Council action, shall not be counted in computing the authority limits set forth above for City officials to approve change orders hereunder.

In emergency situations, the authorized City official may issue a change order beyond the authority limits described above in order to:
a. Prevent interruption of the work which would result in a substantial increase in the costs to, or liability of, City; or
b. Protect the work, equipment, materials to be used in the work, human safety, or the environment at or near the work from substantial and immediate danger or injury; or c. Protect, where damage or injury has occurred, the work, equipment or materials to be used in the work, human safety, or the environment at or near the site of the work from further or additional damage or injury or deterioration.

The authorized City official shall have the authority to issue change orders in such sums as is reasonably necessary for such emergency purposes. After issuing a change order in an emergency situation described above, the authorized City official shall report such action and the reasons therefore to the City Council in writing not later than its next regularly scheduled meeting or as soon thereafter as is practicable.

EXHIBIT 2 335
General Conditions
00700-30
Upon receipt of an approved contract change order, the Contractor shall proceed with the ordered work. If ordered in writing by the Engineer, the Contractor shall proceed with the work so ordered prior to actual receipt of an approved contract change order therefore. In such cases, the Engineer will, as soon as practicable, issue an approved contract change order for such work and the provisions in Paragraph 7.1.1, Procedure and Protest, shall be fully applicable to such subsequently issued contract change order.

When the compensation for an item of work is subject to adjustment under the provisions of Paragraph 00700-7.1, Changes, the Contractor shall, upon request, promptly furnish the Engineer with adequate detailed cost data for such item of work.

7.1.1 Procedure and Protest - A contract change order approved by the Engineer may be issued to the Contractor at any time. Should the Contractor disagree with any terms or conditions set forth in an approved contract change order which he has not executed, he shall submit a written protest to the Engineer within 15 days after the receipt of such approved contract change order. The protest shall state the points of disagreement, and if possible, the contract specification references, quantities, and costs involved. If a written protest is not submitted, payment will be made as set forth in the approved contract change order and such payment shall constitute full compensation for all work included therein or required thereby. Such unprotested approved contract change orders will be considered as executed contract change orders as that term is used in Paragraphs 00700-7.1.2 to 7.1.4, inclusive.

Where the protest concerning an approved contract change order relates to compensation, the compensation payable for all work specified or required by said contract change order to which such protest relates will be determined as provided in Paragraphs 00700-7.1.2 to 7.1.4, inclusive.

The Contractor shall keep full and complete records of the cost of such work and shall permit the Engineer to have such access thereto as may be necessary to assist in the determination of the compensation payable for such work.

Where the protest concerning an approved contract change order relates, to the adjustment of contract time for the completion of the work, the time to be allowed therefore will be determined as provided in Paragraph 00700-6.5, Liquidated Damages.

Proposed contract change orders may be presented to the Contractor for his consideration prior to approval by the Engineer. If the Contractor signifies his acceptance of the terms and conditions of such proposed contract change order by executing such documents and if such change order is approved by the City Manager or City Council and issued to the Contractor, payment in accordance with the provisions as to compensation therein set forth shall constitute full compensation for all work included therein or required thereby. A contract change order executed by the City Manager or City Council is an executed contract change order as that term is used in Paragraph 00700-7.1.2 to 7.1.4, inclusive. An approved contract change order shall supersede a proposed, but unapproved, contract change order covering the same work.

7.1.2 Eliminated Items - The City reserves the right to eliminate any contract item of work prior to the award of the contract without incurring any obligation to pay therefore. Should any contract item of the work be eliminated in its entirety following the award of the contract and in the absence of an executed contract change order covering such elimination, payment will be made to the Contractor for actual costs incurred in connection with such eliminated contract item if incurred prior to the date of notification in writing by the Engineer of such elimination.

If acceptable material is ordered by the Contractor for the eliminated item prior to the date of notification of such elimination by the Engineer, and if orders for such material cannot be canceled, it will be paid for at the actual cost to the Contractor. In such case, the material paid for shall become the property of the City and the actual cost of any further handling will be paid for by the EXHIBIT 2 336
General Conditions
00700-31
City. If the material is returnable to the vendor and if the Engineer so directs, the material shall be returned and the Contractor will be paid for the actual cost of charges made by the vendor for returning the material. The actual cost of handling returned material will be paid for.

The actual costs or charges to be paid by the City to the Contractor as provided in this Paragraph 00700-7.1.2 will be computed in the same manner as if the work were to be paid for on a force account basis as provided in Paragraph 01035-3.0.

7.1.3 Changes in Character of Work - If an ordered change in the plans or specification materially changes the character of the work of a contract item from that on which the Contractor based his bid price, and if the change increases or decrease the actual unit cost of such changed item as compared to the actual or estimated actual cost of performing the work of said item in accordance with the plans and specification originally applicable thereto, an adjustment in compensation therefore will be made by executed contract change order specifying the compensation payable, in accordance with the following:

The basis of such adjustment in compensation will be the difference between the actual unit cost to perform the work of said item or portion thereof involved in the change as originally planned and the actual unit cost of performing the work of said item or portion thereof involved in the change, as changed. Actual unit costs will be determined by the Engineer in the same manner as if the work were to be paid for on a force account basis as provided in Paragraph 01035-3.0; or such adjustment will be as agreed to by the Contractor and the Engineer. Any such adjustment will apply only to the portion of the work of said item actually changed in character. At the option of the Engineer, the work of said item or portion of item which is changed in character will be paid for by force account as provided in Paragraph 01035-3.0.

Failure of the Engineer to recognize a change in character of the work shall not be construed as relieving the Contractor of his duty and responsibility of filing a written notice in accordance with Paragraph 00700-7.5.2.1, Notice.

7.1.4 Extra Work - New, unforeseen work will be classed as extra work when determined by the Engineer that such work is not covered by any of the various items for which there is a bid price or by combinations of such items. In the event portions of such work are determined by the Engineer to be covered by some of the various items for which there is a bid price or combinations of such items, the remaining portion of such work will be classed as extra work. Extra work also includes work specifically designated as extra work in the plans and specifications.

The Contractor shall do such extra work and furnish labor, material, and equipment therefore upon receipt of an approved contract change order or written emergency order of the Engineer, and in the absence of such approved contract change order or written emergency order of the Engineer he shall not be entitled to payment of such extra work.

7.2 Change Orders

7.2.1 Without invalidating the Contract and without notice to sureties or insurers, the City through the Construction Manager, may at any time or from time to time, order additions, deletions, or revisions in the Work; these will be authorized by Field Directive, Field Order, or Change Order. A Change Order will not be issued for a Field Directive unless the Construction Manager concurs with an appeal by the Contractor that such Field Directive is a change in the scope of the Contract. The Contractor shall comply promptly with the requirements for all Change Orders, Field Orders, or Field Directives. The work involved in Change Orders shall be executed under the applicable conditions and requirements of the Contract Documents. If any Field Order causes an increase or decrease in the Contract Amount or an extension or shortening of the Contract Time, an equitable EXHIBIT 2 337
General Conditions
00700-32
adjustment will be made by issuing a Change Order. If the Contractor accepts a Change Order that does not include a time extension, the Contractor waives any claim for additional time for the work covered by that Change Order. Additional or extra work performed by the Contractor without written authorization of a Field Order or Change Order will not entitle the Contractor to an increase in the Contract Amount or an extension of the Contract Time. A reservation of rights, non-waiver of claims, or similar exceptions or reservations by the Contractor on a Change Order for additional time, money, or anything else shall not be permitted and are of no force or effect. It is the intent of the City to have all Change Orders issued comprehensively to address all issues known and unknown relating to time and/or costs.

7.2.2 Extra work shall be that work not shown or detailed on the Contract Drawings and not specified.

Such work shall be governed by all applicable provisions of the Contract Documents. In giving instructions, the Construction Manager shall have authority to make minor changes in the work, not involving extra cost, and not inconsistent with the purposes of the work; but otherwise, except in an emergency endangering life or property, no extra work or change shall be made unless in pursuance of a written order by the City through the Construction Manager, and no claim for an addition to the total amount of the Contract shall be valid unless so ordered.

7.2.3 In case any change increases or decreases the work shown, the Contractor shall be paid for the work actually done at a mutually agreed upon adjustment to the Contract price, based upon the provisions of Section 01035 - Modification Procedures.

7.2.4 If the Contractor refuses to accept a Change Order, the City may issue it unilaterally. The Contractor shall comply with the requirements of the Change Order. The City shall provide for an equitable adjustment to the Contract, and compensate the Contractor accordingly. If the Contractor does not agree that the adjustment is equitable, it may submit a claim in accordance with Paragraph 00700-7.5.2, Potential Claims/Change Orders.

7.2.5 Elimination Of Work - In accordance with Section 7.1.2 above, the City shall be allowed and authorized to eliminate portions of work from the Contract Work at its discretion, and in the best interests of the public, during the course of action of the Project, and not only prior to award of contract. Said elimination of work shall not be determined to be a Termination for Convenience even if said elimination brings the Contract Work to a close. Upon elimination of work under this provision, the payment provisions of 7.1.2 shall apply.

7.3 Differing Site Conditions
Pursuant to Public Contract Code Section 7104, the Contractor shall promptly, and before such conditions are disturbed, notify the Construction Manager in writing, of any:
a. Material that the Contractor believes may be material that is hazardous waste, as defined in Section 25117 of the Health and Safety Code, that is required to be removed to a Class I, Class II, or Class III disposal site in accordance with provisions of existing law.
b. Subsurface or latent physical conditions at the site differing from those indicated. c. Unknown physical conditions at the site of any unusual nature, differing materially from those ordinarily encountered and generally recognized as inherent in work of the character provided for in the Contract.

The City shall promptly, investigate the conditions, and if it finds that the conditions do materially differ, or do involve hazardous waste, and cause a decrease or increase in the Contractor's cost EXHIBIT 2 338
General Conditions
00700-33
of, or the time required for, performance of any part of the work the City shall cause to be issued a change order under the procedures provided in Paragraph 00700-7.2, Change Orders.

In the event that a dispute arises between the City and the Contractor whether the conditions materially differ, or involve hazardous waste, or cause a decrease or increase in the Contractor's cost of, or time required for, performance of any part of the work, the Contractor shall not be excused from any scheduled completion date provided for by the Contract, but shall proceed with all work to be performed under the Contract. The Contractor shall retain any and all rights provided either by Contract or by law which pertain to the resolution of disputes and protests between the contracting parties, Paragraph 00700-7.5, Resolution of Disputes.

No claim of the Contractor under this clause shall be allowed unless the Contractor has given the notice required.

7.4 Value Engineering Change Proposals (VECP)
Refer to Section 01090, References, for the definition of a Value Engineering Change Proposal.

7.4.1 Applicability - The provisions of this Section shall apply only to Value Engineering Change Proposals (VECPs) resulting in net cost savings of Twenty Thousand dollars ($20,000) or greater.

7.4.1.1 Future Changes - The Contractor is entitled to share in the net cost savings of the VECP to the full extent provided for in this Section and in the change order implementing the VECP. However, the net cost savings shall not continue to subsequent contract change orders nor other modifications of the contract which may change the service provided or increase the quantity of any item related to the VECP.

7.4.2 VECP Submittal - The Contractor must submit all VECPs to the Construction Manager after receipt of the Notice To Proceed and prior to surpassing forty percent (40%) of the contract time allowed in Section 01010-3.0, Time Allowed For Completion. The number of copies of the VECP submitted shall be in accordance with that designated for submittals in Section 01300, Submittals.

The Contractor shall include the following information for each VECP, in a form acceptable to the Construction Manager:
a. Description of the differences between the existing design and the proposed design. b. Description of the advantages and disadvantages of the existing design and the proposed design.
c. If the function of an item is altered, the justification for altering that function. d. The effect of the proposed modifications on the performance of the system or facility. e. Any test data regarding the proposed modification.
f. A listing and analysis of all design criteria and specifications that must be changed if the VECP is accepted.
g. A separate detailed estimate of the impact on the project costs, together with a copy of the Contractor’s approved schedule of values or costs.
h. A description and estimate of costs the City may incur to implement the VECP, including, but not limited to, design changes, inspection, testing, and evaluation costs.

EXHIBIT 2 339
General Conditions
00700-34
i. A prediction of any effects the VECP may have on life-cycle costs. j. The effect of the VECP on design and construction schedules. k. All preliminary engineering data necessary to support approval of the VECP.

7.4.3 Acceptance of VECP by City - The City shall have sole discretion to determine whether or not to accept a VECP. The City’s decision shall be final.

A VECP will be rejected if it causes an increase to the contract amount.

Within thirty (30) days after receipt of a VECP by the Construction Manager, the Contractor shall be notified in writing that the VECP is acceptable, rejected or additional time is required for the Construction Manager’s response.

If determined acceptable, the Construction Manager will initiate a contract change order to implement the VECP. A VECP which is acceptable shall be incorporated into the project only through a contract change order.

7.4.4 Contractor’s Right to Withdraw VECP - The Contractor has the right to withdraw part or all of any VECP at any time prior to written acceptance by the City. Such withdrawal shall be made in writing.

Each VECP submitted by the Contractor shall remain valid for a period of thirty (30) days from the date received, unless extended by the Construction Manager. If the Contractor desires to withdraw the VECP prior to its acceptance or rejection, the Contractor shall be liable for the costs incurred by the City in reviewing the VECP.

7.4.5 Change Order Content For Accepted VECP - The contract change order for an accepted VECP shall offer to the Contractor fifty percent (50%) of the net cost savings, as determined by the Construction Manager. The change order shall detail the cost savings of each contract item that is part of the final accepted VECP. The net cost savings shall be accomplished through progress payments for the various items of work listed in the contract change order. The Contractor's costs for development, design and/or implementation of the VECP are not eligible for reimbursement.

The cost for review by the Construction Manager and all City design consultants will be added to the cost of the value engineering proposal prior to determining the reduction of cost.

7.4.6 Identical VECP - A VECP identical to a VECP submitted under any other contract, by the Contractor, or any other contractor, may also be submitted under this Contract, provided that the VECP originated with such contractor and not with the City, Design Consultant, or Construction Manager.

7.4.7 Restrictions - The Contractor may restrict the City’s right to use any VECP data by marking it with the following statement:

This data, furnished pursuant to the Value Engineering Change Proposal Section of this Contract, shall not be duplicated, used or disclosed, in whole or in part, for any purpose except to evaluate the VECP, unless the VECP is accepted by the City. This restriction does not limit the City’s right to use information contained in this data if it is or has been obtained, or is otherwise available from the Contractor or from other sources, without limitations. When this VECP is accepted by the City, the City shall have the right to duplicate, use and disclose any data in any manner and for any purpose whatsoever, and have others do so whether under this or any other contract.

7.4.8 The City's acceptance, approval or use of the VECP shall not in any way reduce, limit or waive Contractor's responsibility under the Contract Documents, including, but not limited to, to perform EXHIBIT 2 340
General Conditions
00700-35
all work and services, including that called for by or because of the VECP, in a competent and workmanlike manner, and pursuant to the standards required by the Contract Documents.

7.4.9. The VECP must not impair any of the essential functions and characteristics of the Project, such as service life, reliability, economy of operation, ease of maintenance, safety and necessary standardized features.

7.4.10 In the event that the contractor and the City cannot reach agreement as to the reduction in contract price associated with the VECP, the VECP will be declared null and void and the original contract conditions will apply. The contractor will bear sole responsibility for the costs of review of the VECP in this case.

7.5 Contract Interpretation

7.5.1 Contract Interpretation by the Construction Manager - Questions regarding the meaning and intent of the Contract Documents shall be referred in writing by the Contractor to the Construction Manager. Where practical, the Construction Manager shall respond to the Contractor in writing with a decision within ten (10) days of receipt of the request.

At the City’s discretion, the City may deduct from monies due the Contractor, time and expense costs incurred by the City, Construction Manager, and Design Consultant for reviewing and responding to unnecessary RFIs. This may include RFIs submitted to inquire about means, methods, or potential modifications for the Contractor’s convenience.

7.5.2 Potential Claims/Change Orders

7.5.2.1 Notice – Inclusive of the provisions in paragraph 00700-7.7, Dispute Resolution, if the Contractor disagrees with the Construction Manager's decision in Paragraph 00700-7.5.1, Contract Interpretation by the Construction Manager, or in any case where the Contractor deems additional compensation or a time extension to the Contract period is due the Contractor for work or materials not covered in the Contract or which the Construction Manager has not recognized as extra work, the Contractor shall notify the Construction Manager, in writing, of its intention to make a claim or request a change order. Potential claims or change orders pertaining to decisions provided in Paragraph 00700-7.5.1 or such other determinations by the Construction Manager shall be filed in writing to the Construction Manager prior to Contractor performing the work giving rise to the potential claim or change order, if based on an act or failure to act by the City, or in all other cases, within five (5) days after the event or occurrence giving rise to the potential claim or change order.

Written notice shall use the words "Notice of Potential Claim/Change Order.” Such Notice of Potential Claim/Change Order shall state the circumstances and the reasons for the claim, but need not state the amount.

Additionally, no claim for additional compensation or extension of time for a delay will be considered unless the provisions of Paragraphs 00700-6.3, Delays, 6.4, Time Extensions, 7.7, Dispute Resolution, are complied with. No claim filed after the date of final payment will be considered.

It is agreed that unless notice as required by the Contract Documents is properly given, the Contractor shall have waived all rights to recover, and shall not recover, costs incurred by it as a result of the alleged extra work, changed work or other situation which had proper notice been given would have given rise to a right for additional compensation. The Contractor should understand that timely notice of potential claims and change orders is of great importance to the Construction Manager and City, and is not merely a formality. Such notice allows the City to consider preventative action, to monitor the Contractor's increased costs resulting from the situation, to marshall facts, and to plan its affairs. Such notice by the Contractor, and the fact that the Construction Manager has kept account of the cost as aforesaid, shall not in any way be construed as proving the validity of the claim.

EXHIBIT 2 341
General Conditions
00700-36

7.5.2.2 Records of Disputed Work - In proceeding with a disputed portion of the Work, the Contractor shall keep accurate records of its costs and shall make available each day, to the Construction Manager or his designated representative, a daily summary of the hours and classification of equipment and labor utilized on the disputed work, as well as a summary of any materials or any specialized services used. Such information shall be submitted to the Construction Manager on a weekly basis, receipt of which shall not be construed as an authorization for or acceptance of the disputed work.

It is the intent of this Section that these records be provided such that the Construction Manager and Contractor can determine and agree upon the Contractor's daily effort expended on the disputed work and determine accurate costs for the disputed work. Such determination shall not be construed as authorization for or acceptance of the disputed work.

7.5.2.3 Meetings - From time to time the Construction Manager may call a special meeting to discuss outstanding claims and potential change orders should it deem this of possible help. The Contractor shall cooperate and attend prepared to discuss its claims, making available the personnel necessary for resolution, and all documents which may reasonably be requested by the Construction Manager.

7.5.3 Claims - The term “Claim” means a written demand or assertion by Contractor seeking an adjustment or interpretation of the terms of the Contract Documents, payment of money, extension of time, or other relief with respect to the Contract Documents, including a determination of disputes or matters in question between City and Contractor arising out of or related to the Contract Documents or the performance of the Work. The term “Claim” shall not include, and the Claims procedures provided under this Section, including but not limited to arbitration, shall not apply to the following:
a. Claims respecting penalties for forfeitures prescribed by statute or regulation that a government agency is specifically authorized to administer, settle, or determine. b. Claims respecting personal injury, death, reimbursement, or other compensation arising out of or resulting from liability for personal injury or death. c. Claims respecting stop notices.

Inclusive of the provisions in paragraph 00700-7.7, Claim must include the following:
a. A statement that it is a Claim and a request for a decision. b. A detailed factual narrative of events fully describing the nature and circumstances giving rise to the Claim, including but not limited to, necessary dates, locations, and items of work affected.
c. A certification, executed by Contractor, that the claim is filed in good faith. The certification language is identified below. The language of the Claim Certification form may not be modified.
d. A certification, executed by each subcontractor claiming not less than 5% of the total monetary amount sought by the claim, that the subcontractor’s portion of the claim is filed in good faith. The certification language is identified below. The language of the Claim Certification form may not be modified.
e. A statement demonstrating that a Change Order Request was timely submitted as required by Section 7 of the General Conditions and Section 01035. f. If a Cost Proposal or declaration was required by Section 7 of the General Conditions and Section 01035, a statement demonstrating that the Cost Proposal or the declaration was timely submitted as required by Section 7 of the General Conditions.

EXHIBIT 2 342
General Conditions
00700-37
g. A detailed justification for any remedy or relief sought by the Claim, including to the extent applicable, the following:

If the Claim involves Extra Work, a detailed cost breakdown of the amounts claimed, including the items specified in Section 7 of the General Conditions and Section 01035. The cost breakdown must be provided even if the costs claimed have not been incurred when the Claim is submitted.

To the extent costs have been incurred when the Claim is submitted, the Claim must include actual cost records (including without limitation, payroll records, material and rental invoices and the like) demonstrating that costs claimed have actually been incurred. To the extent costs have not yet been incurred at the time the Claim is submitted, actual cost records must be submitted on a current basis not less than once a week during any periods costs are incurred. A cost record will be considered current if submitted within 7 days of the date the cost reflected in the record is incurred.

At the request of the Construction Manager or City’s Representative, claimed extra costs may be subject to further verification procedures (such as having an inspector verify the performance of alleged Extra Work on a daily basis). The cost breakdown must include an itemization of costs for i) labor including names, classifications, regular hours and overtime hours worked, dates worked, and other pertinent information; ii) materials stored or incorporated in the work including invoices, purchase orders, location of materials either stored or incorporated into the work, dates materials were transported to the project or incorporated into the work, and other pertinent information; and iii) itemization of machinery and equipment including make, model, serial number, hours of use, dates of use and equipment rental rates of any rented equipment.

If the Claim involves an extension of the Contract Time, written documentation demonstrating the Contractor’s entitlement to a time extension under Section 6 of the General Conditions and Section 01310, including the specific dates for which a time extension is sought and the specific reasons for entitlement of a time extension. The Contract Schedule must demonstrate Contractor’s entitlement to an adjustment of Contract Time under Section 6 of the General Conditions and Section 01310.

If the Claim involves an adjustment of the Contract Sum for delay, written documentation demonstrating the Contractor’s entitlement to such an adjustment under Section 6 of the General Conditions and Section 01310, including but not limited to, a detailed time impact analysis of the Contract Schedule. The Contract Schedule must demonstrate Contractor’s entitlement to such an adjustment under Section 6 of the General Conditions and Section 01310.

For each claim submitted or filed by Contractor, including, but not limited to, any claim on behalf of Contractor and/or any claim by or on behalf of any subcontractor or supplier, of any tier, Contractor shall include the following certification, signed in the same manner as the Contract was signed:

I, being the (must be an officer) of (general contractor or subcontractor), declare under penalty of perjury under the laws of the State of California, and do personally certify and attest that: I have thoroughly reviewed the attached claim for additional compensation and/or extension of time, and know its contents and said claim is made in good faith; the supporting data is truthful and accurate; that the amount requested accurately reflects the Contract adjustment for which the Contractor believes the City is liable; and, further, that I am familiar with California Penal Code Section 72 and California Government Code Section 12650, et. seq., pertaining to false claims, and further know and understand that submission or certification of a false claims many lead to fines, imprisonment and/or severe legal consequences.”

7.6. Assertion of Claims
Claims by Contractor shall be first submitted to the Construction Manager for decision.

EXHIBIT 2 343
General Conditions
00700-38
Notwithstanding the making of any Claim or the existence of any dispute regarding any Claim, unless otherwise directed by Construction Manager, Contractor shall not cause any delay, cessation, or termination in or of Contractor’s performance of the Work, but shall diligently proceed with performance of the Work in accordance with the Contract Documents.

Contractor shall submit a Claim in writing, together with all supporting data specified in Section 7.5 above, to Construction Manager as soon as possible but not later than 30 days after the date the Claim arises under Sections 6 and 7 of the General and Supplemental Conditions.

7.7 Dispute Resolution
All claims by Contractor for a time extension, payment of money or damages arising from work done by, or on behalf of, Contractor pursuant to the Contract and payment of which is not otherwise expressly provided for or the claimant is not otherwise entitled to, or as to the amount of payment which is disputed by the City of Three Hundred Seventy-Five Thousand Dollars ($375,000) or less shall be subject to the provisions set forth in Public Contract Code Section 20104, et. seq. Those sections require that the claim be in writing, include the documents necessary to substantiate the claim, and be filed on or before the final date of payment, subject to all time limits and notice requirements for filing claims under the Contract.

Arbitration
Claims Subject to Public Contract Code Section 9204; Procedure Application. This Section applies solely to the handling and resolution of a claim(s) sent to the City by registered mail or certified mail with return receipt requested in accordance with Public Contract Code Section 9204(c)(1). With respect to such claim(s), the provisions of Public Contract Code Section 9204 shall apply, and are hereby incorporated by reference into these documents and set forth in full at the end of this Section.

Mediation Procedures. Mediation conducted pursuant to Public Contract Code Section 9204 shall be in accordance with the following procedures:
• Request for Mediation: A request for mediation must be in writing and set forth a brief statement that identifies the claim(s), the asserted damages, the names, addresses, and contact information of the parties, and identify their authorized representative, if any, that will participate in the mediation. Contractor hereby expressly waives all claims not timely submitted to mediation in accordance with this Section. • Selection of Mediator: The parties agree that any neutral selected or appointed to preside over the mediation shall be an attorney admitted to practice law in the State of California or a retired judge, and he or she shall possess at least 10 years’ experience practicing law in the substantive areas of public contracting, public construction contracts and construction litigation.
• Time and Place of Mediation: The mediator, using advice and input from the parties, shall set the time of each mediation session, as well as the mediation protocol (i.e., submission of briefs, statement of damages, etc.). The mediation will be held at any convenient location agreeable to the mediator and the parties, as the mediator determines. All reasonable efforts will be made by the parties and the mediator to schedule the first session within thirty (30) calendar days after selection of the mediator. • The mediation may be terminated: (a) by the execution of a settlement agreement by the parties; (b) by a written declaration of the mediator to the effect that further efforts at EXHIBIT 2 344
General Conditions
00700-39
mediation are no longer worthwhile; or (c) by a writing on behalf of a party or parties to the effect that the mediation proceedings are terminated.
• All meetings, communications and correspondence relative to the mediation procedures set forth in this Section shall be subject to any applicable mediation or settlement-related privilege afforded under California law, including, without limitation, California Evidence Code §§1115, et seq. and 1152.
• If, at the termination of the mediation proceedings pursuant to this Section, the claim(s), or any portion thereof, remain(s) in dispute, and as a condition precedent to the commencement by Contractor of any litigation or arbitration, the provisions of California law applicable to the presentation of claims and prosecution of disputes by the Contractor shall apply to claims asserted by the Contractor, including, without limitation, Chapter 1 (commencing with Section 900) and Chapter 2 (commencing with Section 910) of Part 3 of Division 3.6 of Title 1 of the Government Code. Contractor shall be responsible to fully satisfy and comply with all such requirements as may be applicable to any claim(s) presented by Contractor, and nothing in this Section is intended nor shall be construed to change the time periods for filing tort claims or actions specified by Chapter 1 (commencing with §900) and Chapter 2 (commencing with §910) of Part 3 of Division 3.6 of Title 1 of the Government Code. Contractor expressly waives the removal provisions of California Code of Civil Procedure Section 394.
• In the event of any dispute between the City and Contractor, or during the pendency of any claim(s) or associated proceedings under this Section, Contractor shall not stop, or delay performance of, the Work, but shall prosecute the Work diligently to completion in the manner directed by the Engineer.

Other Claims. The procedures and remedies provided herein do not apply to: (1) any claim(s) made by or on behalf of the City, unless the City consents to the application of these procedures and remedies; (2) any claim or dispute relating to stop payment notices; (3) any claim related to the approval, refusal to approve, or substitution of subcontractors, regardless of tier, and suppliers.

EXHIBIT 2 345
General Conditions
00700-40
Public Contract Code - §9204 - Legislative findings and declarations regarding timely and complete payment of contractors for public works projects; claims process:
(a) The Legislature finds and declares that it is in the best interests of the state and its citizens to ensure that all construction business performed on a public works project in the state that is complete and not in dispute is paid in full and in a timely manner.
(b) Notwithstanding any other law, including, but not limited to, Article 7.1 (commencing with Section 10240) of Chapter 1 of Part 2, Chapter 10 (commencing with Section 19100) of Part 2, and Article 1.5 (commencing with Section 20104) of Chapter 1 of Part 3, this Section shall apply to any claim by a contractor in connection with a public works project.
(c) For purposes of this Section:
(1) “Claim” means a separate demand by a contractor sent by registered mail or certified mail with return receipt requested, for one or more of the following:
(A) A time extension, including, without limitation, for relief from damages or penalties for delay assessed by a public entity under a contract for a public works project. (B) Payment by the public entity of money or damages arising from work done by, or on behalf of, the contractor pursuant to the contract for a public works project and payment for which is not otherwise expressly provided or to which the claimant is not otherwise entitled. (C) Payment of an amount that is disputed by the public entity. (2) “Contractor” means any type of contractor within the meaning of Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code who has entered into a direct contract with a public entity for a public works project.
(3)(A) “Public entity” means, without limitation, except as provided in subparagraph (B), a state agency, department, office, division, bureau, board, or commission, the California State University, the University of California, a city, including a charter city, county, including a charter county, city and county, including a charter city and county, district, special district, public authority, political subdivision, public corporation, or nonprofit transit corporation wholly owned by a public agency and formed to carry out the purposes of the public agency. (B) “Public entity” shall not include the following:
(i) The Department of Water Resources as to any project under the jurisdiction of that department. (ii) The Department of Transportation as to any project under the jurisdiction of that department. (iii) The Department of Parks and Recreation as to any project under the jurisdiction of that department. (iv) The Department of Corrections and Rehabilitation with respect to any project under its jurisdiction pursuant to Chapter 11 (commencing with Section 7000) of Title 7 of Part 3 of the Penal Code. (v) The Military Department as to any project under the jurisdiction of that department. (vi) The Department of General Services as to all other projects. (vii) The High-Speed Rail Authority.
(4) “Public works project” means the erection, construction, alteration, repair, or improvement of any public structure, building, road, or other public improvement of any kind.

EXHIBIT 2 346
General Conditions
00700-41
(5) “Subcontractor” means any type of contractor within the meaning of Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code who either is in direct contract with a contractor or is a lower tier subcontractor.
(d)(1)(A) Upon receipt of a claim pursuant to this Section, the public entity to which the claim applies shall conduct a reasonable review of the claim and, within a period not to exceed 45 days, shall provide the claimant a written statement identifying what portion of the claim is disputed and what portion is undisputed. Upon receipt of a claim, a public entity and a contractor may, by mutual agreement, extend the time period provided in this subdivision.
(B) The claimant shall furnish reasonable documentation to support the claim. (C) If the public entity needs approval from its governing body to provide the claimant a written statement identifying the disputed portion and the undisputed portion of the claim, and the governing body does not meet within the 45 days or within the mutually agreed to extension of time following receipt of a claim sent by registered mail or certified mail, return receipt requested, the public entity shall have up to three days following the next duly publicly noticed meeting of the governing body after the 45-day period, or extension, expires to provide the claimant a written statement identifying the disputed portion and the undisputed portion.
(D) Any payment due on an undisputed portion of the claim shall be processed and made within 60 days after the public entity issues its written statement. If the public entity fails to issue a written statement, paragraph (3) shall apply.
(2)(A) If the claimant disputes the public entity's written response, or if the public entity fails to respond to a claim issued pursuant to this Section within the time prescribed, the claimant may demand in writing an informal conference to meet and confer for settlement of the issues in dispute. Upon receipt of a demand in writing sent by registered mail or certified mail, return receipt requested, the public entity shall schedule a meet and confer conference within 30 days for settlement of the dispute. (B) Within 10 business days following the conclusion of the meet and confer conference, if the claim or any portion of the claim remains in dispute, the public entity shall provide the claimant a written statement identifying the portion of the claim that remains in dispute and the portion that is undisputed. Any payment due on an undisputed portion of the claim shall be processed and made within 60 days after the public entity issues its written statement. Any disputed portion of the claim, as identified by the contractor in writing, shall be submitted to nonbinding mediation, with the public entity and the claimant sharing the associated costs equally. The public entity and claimant shall mutually agree to a mediator within 10 business days after the disputed portion of the claim has been identified in writing. If the parties cannot agree upon a mediator, each party shall select a mediator and those mediators shall select a qualified neutral third party to mediate with regard to the disputed portion of the claim. Each party shall bear the fees and costs charged by its respective mediator in connection with the selection of the neutral mediator. If mediation is unsuccessful, the parts of the claim remaining in dispute shall be subject to applicable procedures outside this Section.
(C) For purposes of this Section, mediation includes any nonbinding process, including, but not limited to, neutral evaluation or a dispute review board, in which an independent third party or board assists the parties in dispute resolution through negotiation or by issuance of an evaluation. Any mediation utilized shall conform to the timeframes in this Section. (D) Unless otherwise agreed to by the public entity and the contractor in writing, the mediation conducted pursuant to this Section shall excuse any further obligation under Section 20104.4 to mediate after litigation has been commenced.

EXHIBIT 2 347
General Conditions
00700-42
(E) This Section does not preclude a public entity from requiring arbitration of disputes under private arbitration or the Public Works Contract Arbitration Program, if mediation under this Section does not resolve the parties' dispute.
(3) Failure by the public entity to respond to a claim from a contractor within the time periods described in this subdivision or to otherwise meet the time requirements of this Section shall result in the claim being deemed rejected in its entirety. A claim that is denied by reason of the public entity's failure to have responded to a claim, or its failure to otherwise meet the time requirements of this Section, shall not constitute an adverse finding with regard to the merits of the claim or the responsibility or qualifications of the claimant.
(4) Amounts not paid in a timely manner as required by this Section shall bear interest at 7 percent per annum.
(5) If a subcontractor or a lower tier subcontractor lacks legal standing to assert a claim against a public entity because privity of contract does not exist, the contractor may present to the public entity a claim on behalf of a subcontractor or lower tier subcontractor. A subcontractor may request in writing, either on his or her own behalf or on behalf of a lower tier subcontractor, that the contractor present a claim for work which was performed by the subcontractor or by a lower tier subcontractor on behalf of the subcontractor. The subcontractor requesting that the claim be presented to the public entity shall furnish reasonable documentation to support the claim. Within 45 days of receipt of this written request, the contractor shall notify the subcontractor in writing as to whether the contractor presented the claim to the public entity and, if the original contractor did not present the claim, provide the subcontractor with a statement of the reasons for not having done so. (e) The text of this Section or a summary of it shall be set forth in the plans or specifications for any public works project that may give rise to a claim under this Section. (f) A waiver of the rights granted by this Section is void and contrary to public policy, provided, however, that (1) upon receipt of a claim, the parties may mutually agree to waive, in writing, mediation and proceed directly to the commencement of a civil action or binding arbitration, as applicable; and (2) a public entity may prescribe reasonable change order, claim, and dispute resolution procedures and requirements in addition to the provisions of this Section, so long as the contractual provisions do not conflict with or otherwise impair the timeframes and procedures set forth in this Section. (g) This Section applies to contracts entered into on or after January 1, 2017. (h) Nothing in this Section shall impose liability upon a public entity that makes loans or grants available through a competitive application process, for the failure of an awardee to meet its contractual obligations.
(i) This Section shall remain in effect only until January 1, 2020, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2020, deletes or extends that date.

8.0 PAYMENT

8.1 Scope of Payment

8.1.1 General - The Contractor shall accept the compensation, as herein provided, as full payment for furnishing all labor, materials, tools, equipment, and incidentals necessary for completing the Work according to the Contract Documents, and no additional compensation will be allowed therefore.

Neither the payment of any partial payment estimate nor of any retained percentage shall relieve the Contractor of any obligation to make good any defective work or material.

EXHIBIT 2 348
General Conditions
00700-43

8.1.2 Payment for Patents and Patent Infringement - All fees or claims for any patented invention, article, or arrangement that may be used upon, or in any manner connected with, the performance of the work or any part thereof shall be included in the price bid for doing the work, and the Contractor and its sureties shall defend, protect, and hold the City, the Construction Manager, and Design Consultants, together with all their officers, agents, and employees harmless against liability of any nature or kind for any and all costs, legal expenses, and damages made for such fees or claims and against any and all suits and claims brought or made by the holder of any invention or patent, or on account of any patented or unpatented invention, process, article, or appliance manufactured for or used in the performance of the Contract, including its use by the City, unless otherwise specifically stipulated in the Contract. Before final payment is made on the Contract, the Contractor shall furnish an affidavit to the City regarding patent rights for the project. The affidavit shall state that all fees and payments due as a result of the work incorporated into the project or methods utilized during construction have been paid in full. The Contractor shall certify in the affidavit that no other fees or claims exist for work in this project.

8.1.3 Payment of Taxes - The Contractor shall pay and shall assume exclusive liability for all taxes levied or assessed on or in connection with the Contractor's performance of this Contract, including, but not limited to, State and local sales and use taxes, Federal and State payroll taxes or assessments, and excise taxes, and no separate allowance will be made therefore, and all costs in connection therewith shall be included in the total amount of the Contract price.

8.1.4 Payment for Labor and Materials - The Contractor shall pay and require its subcontractors to pay any and all accounts for labor including worker's compensation premiums, state unemployment and federal social security payments and other wage and salary deductions required by law. The Contractor also shall pay and cause its subcontractors to pay any and all accounts for services, equipment, and materials used by the Contractor and its subcontractors during the performance of work under this Contract. Such accounts shall be paid as they become due and payable. If requested by the City, the Contractor shall furnish proof of payment of such accounts to the City.

8.2 Partial Payments
In consideration of the faithful performance of the work prosecuted in accordance with the provisions of these Specifications and the Contract, the City will pay the Contractor for all such work installed on the basis of percentage completion. Amounts earned will be based on accepted Cost Breakdown (Section 01025, Measurement and Payment).

Payments will be made by the City to the Contractor on estimates duly certified and approved by the Construction Manager, based on the value of equipment installed and tested, labor and materials incorporated into said permanent work by the Contractor during the preceding month, and acceptable materials and equipment on hand (materials and equipment furnished and delivered to the site by the Contractor and not yet incorporated into the work accompanied by an approved invoice). Payments will not be made for temporary construction or material submittals unless specifically provided for in the Contract Documents.

Partial payments will be made monthly based on work accomplished as of a day mutually agreed between the City and the Contractor. Prior to submitting its payment estimate, the Contractor shall meet with the Construction Manager to reach agreement on the percent completion and materials on hand for that payment period.

The Contractor shall submit its estimate of the work completed during the prior month and the work completed to date in a format acceptable to the Construction Manager and corresponding to the accepted cost breakdown. Additionally, the Contractor shall submit a detailed statement of the Contractor's request for payment of acceptable materials and equipment on hand in compliance EXHIBIT 2 349
General Conditions
00700-44
with Paragraph 00700-8.3, Partial Payments - Inclusion of Materials on Hand. Upon receipt of Contractor's requests for payment, the City shall act in accordance with the following:
a. The Construction Manager shall review the submitted estimates, as soon as practical after receipt, for the purpose of determining that the estimates are a proper request for payment, and shall prepare a certified estimate of the total amount of work done and acceptable materials and equipment on hand.
b. Any request for payment determined not to be a proper payment request suitable for payment shall be returned to the Contractor as soon as practicable, but not later than seven (7) days after receipt. A request for payment returned pursuant to this paragraph shall be accompanied by a document setting forth in writing the reasons why the request for payment is not proper.
c. The number of days available to the City to make a payment without incurring interest pursuant to this Section shall be reduced by the number of days by which the City exceeds the seven (7) day return requirement set forth in subdivision (b) above.

Payment will be made by the City to the Contractor in accordance with City's normal accounts payable procedures; the City shall retain amounts in accordance with Paragraph 00700-8.4, Right to Withhold Amounts.

No such estimate or payment shall be required to be made, when in the judgment of the Construction Manager, the Work is not proceeding in accordance with the provisions of the Contract, or when in the Construction Manager's judgment the total value of the Work done since the last estimate amounts to less than One Thousand Dollars ($1,000.00). Additionally, no payments shall be made until the Construction Manager has received an acceptable monthly schedule update covering the latest required period, certified payrolls and other required pay records, and a conditional waiver and release upon progress payment from Contractor for the current pay period and an unconditional waiver and release upon progress payment for the prior progress payment period. The City reserves the right to require, as a condition precedent to payment, that Contractor provide conditional and unconditional waivers and releases from Contractor's subcontractors and suppliers.

Subject to the provisions of this Section, the City shall pay the Contractor within thirty (30) days after receipt of undisputed and properly submitted requests for payment from the Contractor. In accordance with Public Contract Code, if the City fails to pay an undisputed request for payment within the allotted thirty (30) days, the City shall pay interest to the Contractor equivalent to the legal rate set forth in the Code of Civil Procedure.

8.3 Partial Payments - Inclusion of Materials on Hand
Materials, as used herein, shall be considered to be those items which are fabricated and manufactured goods and equipment. Only those materials for which the Contractor can transfer clear title to the City will be qualified for partial payment. The Contractor may request payment of seventy-five (75) percent of the actual net cost of these materials.

To receive partial payment for materials and equipment delivered to the Site, but not incorporated in the Work, it shall be necessary for the Contractor to submit to the Construction Manager a list of such materials, at least seven (7) days prior to submitting the monthly estimate of amount earned for work completed. At the Construction Manager's sole discretion, the Construction Manager will approve items for which partial payment is to be made subject to the following:

EXHIBIT 2 350
General Conditions
00700-45
a. Only equipment or materials which have received favorable review of shop drawings will qualify.
b. Eligible equipment or materials must be delivered and properly stored, protected, and maintained in a manner favorably reviewed by the Construction Manager, at the job site or at a bonded warehouse.
c. The Contractor's actual net cost for the materials must be supported by paid invoices of suppliers, or other documentation requested by the Construction Manager. d. Materials or equipment delivered to the Site less than thirty (30) days prior to their scheduled incorporation in the Work shall not qualify.
e. Final payment shall be made only for materials actually incorporated in the Work. Upon acceptance of the Work, all materials remaining for which advance payments had been made shall revert to the Contractor, unless otherwise agreed, and partial payments made for these items shall be deducted from the final payment for the Work. f. Partial payments for materials and equipment on hand shall not be deemed to be final payment for the material nor relieve the Contractor of its obligations under the Contract. g. Partial payments for materials and equipment on hand shall be subject to retention in accordance with Paragraph 00700-8.4., Right to Withhold Amounts.

8.4 Right to Withhold Amounts

8.4.1 Retention - The City will deduct from each partial payment and retain as part security, five (5) percent of the amount earned until the final payment.

Pursuant to Public Contract Code, for monies earned by the Contractor and withheld by the City to ensure the performance of the Contract, the Contractor, may, at his or her option, choose to substitute securities meeting the requirements of said Code. In the event the Contractor wishes to choose this option, the Contractor shall enter into an escrow agreement with the City, and the escrow agent, a qualified bank to be chosen by City, in the form of the agreement included in the project specifications. The costs of such escrow shall be paid by the Contractor. The securities to be deposited in said escrow account shall be equivalent, in fair market value, to the amount to be withheld as performance retention. The securities shall be held in accordance with the provisions of the Public Contract Code, and the implementing agreement.

Contractor shall have the obligation of ensuring that such securities deposited are sufficient so as to maintain, in total fair market value, an amount equal to the cash amount of the sums to be withheld under the Contract. If, upon written notice from the City, or from the appropriate escrow agent, indicating that the fair market value of the securities has dropped below the dollar amount of monies to be withheld by the City to ensure performance, Contractor shall, within five days of the date of such notice, post additional securities as necessary to ensure that the total fair market value of all such securities held by the City, or in escrow, is equivalent to the amount of money to be withheld by the City under the Contract.

Any Contractor wishing to exercise this option shall give notice in writing to City, and shall thereafter execute an escrow agreement in the following form:

EXHIBIT 2 351
General Conditions
00700-46

ESCROW AGREEMENT FOR

SECURITY DEPOSITS IN LIEU OF RETENTION
This Escrow Agreement is made and entered into by and between; whose address is
hereinafter called "City", and
whose address is
hereinafter called "Contractor", and
whose address is
hereinafter called "Escrow Agent."
For the consideration hereinafter set forth, the City, Contractor, and Escrow Agent agree as follows:

1. Pursuant to the Public Contract Code of the State of California, Contractor has the option to deposit securities which meet the requirements set forth in said Code, with Escrow Agent, as a substitute for retention earnings required to be withheld by City pursuant to the Construction Contract entered into between City and Contractor for _________________________ in the amount of dated (hereinafter referred to as the "Contract"). Alternatively, on written request of the Contractor, the City shall make payments of the retention earnings directly to the Escrow Agent. When Contractor deposits the securities as a substitute for Contract earnings, the Escrow Agent shall notify the City within 10 days of the deposit. The market value of the securities at the time of the substitution shall be at least equal to the cash amount then required to be withheld as retention under the terms of the Contract between the City and Contractor. Securities shall be held in the name of City, and shall designate the Contractor as the beneficial owner.

2. City shall make progress payments to Contractor for such funds which otherwise would be withheld from progress payments pursuant to the Contract provisions, provided that the Escrow Agent holds securities in the form and amount specified above.

3. When the City makes payment of retention earned directly to the Escrow Agent the Escrow Agent shall hold them for the benefit of the Contractor until such time as the escrow created under this Contract is terminated. The Contractor may direct the investment of the payments into securities.

All terms and conditions of this agreement and the rights and responsibilities of the parties shall be equally applicable and binding when the City pays the Escrow Agent directly.

4. Contractor shall be responsible for paying all fees for the expenses incurred by Escrow Agent in administering the Escrow Account, and all expenses of the City. These expenses and payment terms shall be determined by the City, Contractor, and Escrow Agent.

5. The interest earned on the securities or the money market accounts held in escrow and all interest earned on that interest shall be for the sole account of Contractor and shall be subject to withdrawal by Contractor at any time and from time to time without notice to the City.

6. Contractor shall have the right to withdraw all or any part of the principal in the Escrow Account only by written notice to Escrow Agent accompanied by written authorization from City to the EXHIBIT 2 352
General Conditions
00700-47
Escrow Agent that City consents to the withdrawal of the amount sought to be withdrawn by Contractor.

7. The City shall have a right to draw upon the securities in the event of default by the Contractor.

Upon seven days' written notice to the Escrow Agent from the City of the default, the Escrow Agent shall immediately convert the securities to cash and shall distribute the cash as instructed by the City.

8. Upon receipt of written notification from the City certifying that the Contract is final and complete, and that the Contractor has complied with all requirements and procedures applicable to the Contract, Escrow Agent shall release to Contractor all securities and interest on deposit less escrow fees and charges of the Escrow Account. The escrow shall be closed immediately upon disbursement of all moneys and securities on deposit and payments of fees and charges.

9. Escrow Agent shall rely on the written notifications from the City and the Contractor pursuant to Sections (4) to (6), inclusive, of this Agreement, and City and Contractor shall hold Escrow Agent harmless from Escrow Agent's release and disbursement of the securities and interest as set forth above.

10. The names of the persons who are authorized to give written notice or to receive written notice on behalf of the City and on behalf of Contractor in connection with the foregoing, and exemplars of their respective signatures are as follows:

On Behalf of City: On Behalf of Contractor:

Title Title
Name Name
Signature Signature
Address Address
EXHIBIT 2 353
General Conditions
00700-48
On Behalf of Escrow Agent:
____________________________
Title
____________________________
Name
____________________________
Signature
____________________________
Address
At the time the Escrow Account is opened, City and Contractor shall deliver to the Escrow Agent a fully executed counterpart of this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement by their proper officers on the date first set forth above.

CITY: CONTRACTOR:
________________________ ________________________
Title Title
________________________ ________________________
Name Name
________________________ _________________________
Signature Signature
EXHIBIT 2 354
General Conditions
00700-49

8.4.2 Other Withholds - In addition to the amount which the City may otherwise retain under the Contract, the City may withhold a sufficient amount or amounts of any payment or payments otherwise due the Contractor, as in its judgment may be necessary to cover:
a. Payments which may be past due and payable for just claims against the Contractor or any subcontractor for labor or materials furnished for the performance of this Contract. b. Defective work not remedied.
c. Failure of the Contractor to make proper payments to its subcontractors or suppliers. d. A reasonable doubt that the Contract can be completed for the balance then unpaid. e. Damage to another Contractor or third party, or to property. f. Failure of the Contractor to keep its work progressing in accordance with its progress schedule or maintaining current "As-Built" record drawings. g. The City's costs for the Contractor's failure to complete within the allowed time. h. Cost of insurance arranged by the City due to cancellation or reduction of the Contractor's insurance.
i. Failure of the Contractor to make proper submissions, as herein specified. j. Failure to submit, revise, resubmit, or otherwise conform to the requirements herein for preparing and maintaining a construction schedule.
k. Payments due the City from the Contractor.
l. Reduction of Contract Amount because of modifications. m. The Contractor's neglect or unsatisfactory prosecution of the work including failure to clean up.
n. Provisions of law that enable or require the City to withhold such payments in whole or in part.

When the above reasons for withhold amounts are removed, payment may be made to the Contractor for amounts withheld.

The City in its discretion may apply any withheld amount or amounts to the payment of valid claims.

In so doing, the City shall be deemed the agent of the Contractor, and any payment so made by the City shall be considered as a payment made under the Contract by the City to the Contractor, and the City shall not be liable to the Contractor for such payment made in good faith. Such payments may be made without prior judicial determination of the claim or claims. The City will render to the Contractor a proper accounting of such funds disbursed in behalf of the Contractor.

8.5 Substantial Completion
EXHIBIT 2 355
General Conditions
00700-50
When the Contractor considers that the Work is substantially complete, the Contractor shall notify the Construction Manager in writing. Upon receipt of the notification, the Construction Manager, the City and/or their authorized representatives will make inspection, to determine if the Work is sufficiently complete in accordance with the Contract Documents so the City can occupy or utilize the Work for its intended use. If items are found which prevent such use or occupancy, the Construction Manager shall notify the Contractor in writing of such items.

Upon the completion of such corrective work, the Contractor shall notify the Construction Manager in writing. The Construction Manager shall inspect the Work to determine its acceptability for Substantial Completion and for determination of other items which do not meet the terms of the Contract. Upon verification that the project is substantially complete the Construction Manager shall prepare a Certificate of Substantial Completion. The Certificate shall establish the date of Substantial Completion and the responsibilities of the City and Contractor for security, maintenance, heat, utilities, damage to the Work and insurance, commencement of warranties required by the Contract Documents, and shall fix the time, not to exceed 60 days, within which the Contractor shall finish all items on the punch list accompanying the Certificate. When the preceding provisions have been approved by both the City and the Contractor, they shall sign the Certificate to acknowledge their written acceptance of the responsibilities assigned to them in such Certificate.

By such acknowledgement, the Contractor agrees to pay the City's actual costs including, but not limited to, charges for engineering, inspection and administration incurred due to the failure to complete the punch list within the time period provided in the Certificate of Substantial Completion.

City shall have the right to exclude Contractor from the Site after the date of Substantial Completion, but City will allow Contractor reasonable access to complete the Work or correct items on any deficiency list or punch lists at times and in areas designated by the City in its sole discretion and without additional compensation to Contractor.

8.6 Final Inspection and Payment
Upon completion of the Work, and upon completion of final cleaning, the Contractor shall so notify the Construction Manager in writing. Upon receipt of the notification, the Construction Manager, the City and/or their authorized representatives will make the final inspection, to determine the actual status of the Work in accordance with the terms of the Contract. If materials, equipment, or workmanship are found which do not meet the terms of the Contract, the Construction Manager shall prepare a punch list of such items and submit it to the Contractor. Following completion of the corrective work by the Contractor, the Construction Manager shall notify the City that the Work, has been completed in accordance with the Contract. Final determination of the acceptability of the Work shall be made by the City. After completion of the work, but prior to its acceptance by the City, the last partial payment will be made to the Contractor in accordance with Paragraph 00700-8.2, Partial Payments.

After receipt of the last partial payment, but prior to acceptance of the Work by the City, the Contractor shall send a letter to the Construction Manager. The letter shall state that acceptance of the final payment described below shall operate as and shall be, a release to the City, the Construction Manager, the Design Consultant, and their duly authorized agents, from all claims of and/or liability to the Contract arising by virtue of the Contract related to those amounts. Disputed Contract claims in stated amounts previously filed, as provided in Paragraph 00700-7.5, may be specifically excluded by the Contractor from the operation of the release.

Neither final payment nor any retention shall become due until Contractor submits the following items to Construction Manager:
a. The final Application For Payment and all submittals required in accordance with the General Conditions.

EXHIBIT 2 356
General Conditions
00700-51
b. All guarantees and warranties procured by Contractor from subcontractors, all operation and maintenance manuals for equipment installed in the Project, as-built documents, and all other submittals required by the Contract Documents.
c. Unconditional waivers and releases upon final payment from all subcontractors and suppliers and a conditional waiver and release upon final payment from Contractor. d. Certified payroll records and all other pay records as determined by the City.

Following receipt of all required submittals and the Construction Manager's written statement that construction is complete and recommendation that the City accept the project, the City will take formal action on acceptance.

Within ten (10) days of the acceptance by the City of the completed work embraced in the Contract, the City will cause to be recorded in the office of the County Recorder a Notice of Completion.

Thirty-five (35) days after recording the Notice of Completion of the work involved in the Contract, the City will pay the Contractor in lawful money such sums of money as may be due the Contractor including all sums retained but excluding such sums as have previously been paid the Contractor.

This payment will constitute the final payment to the Contractor under this Contract.

8.7 Warranty of Title
No material, supplies, or equipment for the work under this Contract shall be purchased subject to any chattel mortgage, security agreement, or under a conditional sale or other agreement by which an interest therein or any part thereof is retained by the seller or supplier. The Contractor warrants good title to all material, supplies, and equipment installed or incorporated in the work and agrees upon completion of all work to deliver the premises, together with all improvements and appurtenances constructed or placed thereon by the Contractor, to the City free from any claim, liens, security interest, or charges, and further agrees that neither the Contractor nor any person, firm, or corporation furnishing any materials or labor for any work covered by this Contract shall have any right to a lien upon the premises or any improvement or appurtenances thereon.

9.0 EXISTING UTILITIES

9.1 General
Pursuant to Government Code Section 4216, et. seq., the Contractor shall notify the appropriate notification center, U.S.A., 1-800-642-2444.

9.2 Notification and Location
At least three (3) working days before performing any excavation work, the Contractor shall request the utility owners to mark or otherwise indicate the location of their service.

It shall be the Contractor's responsibility to determine the exact location and depth of all utilities, including service connections, which have been marked by the respective owners and which the Contractor believes may affect or be affected by the Contractor's operations. If no pay item is EXHIBIT 2 357
General Conditions
00700-52
provided in the Contract for this work, full compensation for such work shall be considered as included in the prices bid for other items of work.

9.3 Damage and Protection
The Contractor shall immediately notify the Construction Manager and utility owner of any damage to a utility.

For work within a public right of way or utility easement, the party responsible for the cost of repairing and/or relocating damaged utilities shall be as follows:

Description Responsible Party
a. Utility mains delineated incorrectly on City/Utility Company City’s plans
b. Utility mains delineated correctly on City’s Utility Company plans but information provided
incorrectly by utility company
c. Utility mains not shown on City’s plan Utility Company d. Utility mains incorrectly marked in the Utility Company field by utility company
e. Utility mains incorrectly marked and/or Contractor
delineated on City’s plans
f. Utility service laterals whether indicated Contractor or not indicated on plans and whether
correctly or incorrectly shown on City’s
plans

9.4 Utility Relocation and Rearrangement
The right is reserved to the City and the owners of utilities or their authorized agents to enter upon the Work area for the purpose of making such changes as are necessary for the rearrangement of their facilities or for making necessary connections or repairs to their properties. The Contractor shall cooperate with forces engaged in such work and shall conduct its operations in such a manner as to avoid any unnecessary delay or hindrance to the work being performed by such forces and shall allow the respective utilities time to relocate their facility.

The Contractor assumes responsibility for the removal, relocation, or protection of existing facilities wherein said facilities are identified by the Plans, field located by a utility company, or as provided for in the General Requirements. The Contractor shall coordinate with the owner of utility facilities for the rearrangement of said facilities.

In the event that underground utilities are found that are not shown in the Contract Documents or are found to exist in a different location than shown in the Contract Documents, the Contractor shall: (1) notify the Construction Manager of the existence of said facilities immediately; and (2) take steps to ascertain the exact location of all underground facilities prior to doing work that may damage such facilities.

EXHIBIT 2 358
General Conditions
00700-53
Requests for extensions of time arising out of utility rearrangement delays shall be determined by Construction Manager. In accordance with Government Code Section 4215 the Contractor shall not be assessed liquidated damages for delay in completion of the project, when such delay is caused by the failure of the City or utility company to provide for the removal or relocation of facilities for which they are the responsible party as defined in Paragraph 00700-9.3, Damage and Protection.

Where it is determined by the Construction Manager that the rearrangement of an underground main, the existence of which is not shown on the Plans, Specifications, or in the General Requirements, is essential in order to accommodate the contemplated improvement, the Construction Manager will provide for the rearrangement of such facility by other forces or by the Contractor in accordance with the provisions of Paragraph 00700-7.2, Change Orders.

When the General Requirements, Specifications, or Plans indicate that a utility is to be relocated, altered or constructed by others, the City will conduct all negotiations with the utility company and the work will be done at no cost to the Contractor.

Temporary or permanent relocation or alteration of utilities desired by the Contractor for its own convenience shall be the Contractor's responsibility and it shall make arrangements and bear all costs.

10.0 APPLICABLE LAW/CODE REQUIREMENTS
Contractor shall perform the Work in accordance with the following Applicable Law/Code Requirements and all code requirements listed in the Scope of Work:
a. All laws, statutes, the most recent building codes, ordinances, rules, regulations, and lawful orders of all public authorities having jurisdiction over City, Contractor, any subcontractor, the Project, the Project site, the Work, or the prosecution of the Work, including, but not limited to:
(1) any federal, state or local law, code, regulation or consent order or agreement having the force of law;
(2) any formally adopted and generally applicable rule, requirement, determination, standard, policy, implementation schedule or order of any governmental or regulatory agency having appropriate jurisdiction;
(3) any established interpretation of law or regulation utilized by an appropriate governmental or regulatory agency if such interpretation is documented by such governmental or regulatory agency and generally applicable; and, (4) any governmental or regulatory agency approval, in each case applicable from time to time to the siting, permitting, design, acquisition, construction, equipping, financing, ownership, possession, start-up, testing, operation, maintenance, repair, replacement or management of the Facilities
b. Applicable Sections in the State of California Labor Code. c. All Applicable Code Requirements relating to nondiscrimination, payment of prevailing wages, payroll records, apprentices, and work day.

Contractor shall comply with and give notices required by all Applicable Code Requirements, including all environmental laws and all notice requirements under the State of California Safe Drinking Water and Enforcement Act of 1986 (State of California Health and Safety Code Section 25249.5, and applicable sections that follow). Contractor shall promptly notify City’s Representative EXHIBIT 2 359
General Conditions
00700-54
in writing if Contractor becomes aware during the performance of the Work that the Contract Documents are at variance with Applicable Code Requirements.

If Contractor performs Work which it knows or should know is contrary to Applicable Code Requirements, without prior notice to City and City’s Representative, Contractor shall be responsible for such Work and any resulting damages including, without limitation, the costs of correcting Defective Work.

The Applicable Code Requirements under this Section shall be those in existence at the time the Contract is approved by the City Council. Any significant change in the Applicable Code Requirements that occurs after approval of the Contract by the City Council, and that significantly changes the scope or cost of work in the respective stages, shall be addressed through the change order and modifications procedures established in the Contract Documents.

11.0 USE OF SITE AND CLEAN UP
Contractor shall confine operations at the Project site to areas permitted by law, ordinances, permits, and the Contract Documents. Contractor shall not unreasonably encumber the Project site with materials or equipment.

Contractor shall, during performance of the Work, keep the Project site and surrounding area free from the accumulation of excess dirt, waste materials, and rubbish caused by Contractor.

Contractor shall remove all excess dirt, waste material, and rubbish caused by the Contractor; tools; equipment; machinery; and surplus materials from the Project site and surrounding area at the completion of the Work.

Personnel of Contractor and subcontractors shall not occupy, live upon, or otherwise make use of the Project site during any time that Work is not being performed at the Project site, except as otherwise provided in the Contract Documents.

Contractor shall conduct and cause all working forces at the site to maintain the site in a neat orderly manner throughout the construction operations. The work shall be conducted in a manner that will control the dust. When ordered to provide dust control, the Contractor shall use water or turn soil to reduce the dusty conditions, all to the satisfaction of the City’s Representative and in accordance with Section 10 of the City of Stockton Standard Specifications. During construction, Contractor shall remove all rubbish and debris as it is generated to the satisfaction of the Engineer.

12.0 CORRECTION OF DEFECTIVE WORK AND GUARANTEE TO REPAIR PERIOD The term “Guarantee To Repair Period” means a period of 1 year from Final Completion, unless a longer period of time is specified.

Contractor shall (1) correct Defective Work that becomes apparent during the progress of the Work or during the Guarantee To Repair Period, and (2) replace, repair, or restore to City’s satisfaction any other parts of the Work and any other real or personal property which is damaged or destroyed as a result of Defective Work or the correction of Defective Work. Contractor shall promptly commence such correction, replacement, repair, or restoration upon notice from City’s Representative or City, but in no case later than 10 days after receipt of such notice; and Contractor shall diligently and continuously prosecute such correction to completion. Contractor shall bear all costs of such correction, replacement, repair, or restoration, and all losses resulting from such Defective Work, including additional testing, inspection, and compensation for City’s Representative’s services and expenses. Contractor shall perform corrective Work at such times that are acceptable to City and in such a manner as to avoid, to the extent practicable, disruption to City’s activities.

EXHIBIT 2 360
General Conditions
00700-55
If immediate correction of Defective Work is required for life safety or the protection of property and is performed by City or Separate Contractors, Contractor shall pay to City all reasonable costs of correcting such Defective Work. Contractor shall replace, repair, or restore to City’s satisfaction any other parts of the Construction Work and any other real or personal property which is damaged or destroyed as a result of such Defective Work or the correction of such Defective Work.

Contractor shall remove from the Project site portions of the Construction Work and materials which are not in accordance with the Contract Documents and which are neither corrected by Contractor nor accepted by City.

If Contractor fails to commence correction of Defective Work within 10 days after notice from City or City’s Representative or fails to diligently prosecute such correction to completion, City may correct the Defective Work; and, in addition, City may remove the Defective Work and store salvageable materials and equipment at Contractor’s expense.

If Contractor fails to pay the costs of such removal and storage as required by the Contract Documents within 10 days after written demand, City may, without prejudice to other remedies, sell such materials at auction or at private sale, or otherwise dispose of such material. Contractor shall be entitled to the proceeds of such sale, if any, in excess of the costs and damages for which Contractor is liable to City, including compensation for City’s Representative’s services and expenses. If such proceeds of sale do not cover costs and damages for which Contractor is liable to City, the Contract Sum shall be reduced by such deficiency. If there are no remaining payments due Contractor or the remaining payments are insufficient to cover such deficiency, Contractor shall promptly pay the difference to City.

Contractor’s obligations under this Section are in addition to, and not in limitation of, its warranty under Section 01015 or any other obligation of Contractor under the Contract Documents.

Enforcement of Contractor’s express warranties and guarantees to repair contained in the Contract Documents shall be in addition to and not in limitation of any other rights or remedies City may have under the Contract Documents or at law or in equity for Defective Work, including, but not limited to, under CCP Sections 337.1 and 337.15. Nothing contained in this Section shall be construed to establish a period of limitation with respect to other obligations of Contractor under the Contract Documents. Establishment of the Guarantee To Repair Period relates only to the specific obligation of Contractor to correct the Work and in no way limits either Contractor’s liability for Defective Work or the time within which proceedings may be commenced to enforce Contractor’s obligations under the Contract Documents.
***END OF SECTION***
EXHIBIT 2 361
Supplementary Conditions
00800-1
SECTION 00800 - SUPPLEMENTARY CONDITIONS

1.0 LOCAL EMPLOYMENT (For contracts valued at $100,000 and above) Contractor shall make a good-faith effort, with the assistance of local labor union hiring halls or community organizations designated by the City to employ qualified individuals who are, and have been for one year prior to the effective date of the contract, residents of Stockton in sufficient numbers so that no less than 50% of the contractor's total construction work force, including any subcontractor work force, measured in labor work hours, is comprised of Stockton residents.

Contractor or subcontractor shall make a good faith effort to employ apprentices who are enrolled in and participating in a viable apprenticeship program serving the San Joaquin Valley and approved by the State Department of Apprenticeship Standards. This apprenticeship requirement shall apply for each apprenticable craft or trade in which the contractor employs workers in performing any of the work under the contract.

If, in response to a written request made at least 48 hours (excluding Saturdays, Sundays and holidays) before the date on which one or more apprentices are required, an apprenticeship program(s) does not dispatch any apprentice or dispatches fewer apprentices than requested to a contractor (that has agreed to employ and train apprentices in accordance with California Labor Code Section 1777.5) within 72 hours of such request (excluding Saturdays, Sundays and holidays), that contractor shall be considered in compliance with the apprentice employment requirement for that trade or craft for a 90-day period from the request date, provided the contractor employs those apprentices who are dispatched. Where there is more than one viable apprenticeship program for that trade or craft serving the San Joaquin Valley, a contractor, that is not a participant in or an affiliate of an apprenticeship program and receives fewer apprentices dispatched than requested, shall not be considered in compliance with the apprentice employment requirement unless the contractor has made a written request for the dispatch of apprentices from at least two viable apprenticeship programs. A contractor, that is a participant in or an affiliate of an apprenticeship program, shall make dispatch requests to the program in which it is affiliated or participating.

In the event that no viable apprenticeship program exists for a particular craft or trade, the contractor shall be exempt from the requirements of this Section with regard to that craft or trade.

A contractor employing apprentices pursuant to this Section shall employ apprentices in a ratio of not less than one apprentice for each five journeymen in the apprenticeship craft or trade classification that are employed on the public work contract unless to do so would result in apprentice employment in ratios below the minimum ratios prescribed by California Labor Code Section 1777.5 in which case apprentice employment shall be at least in the ratios prescribed by California Labor Code Section 1777.5.

This Section shall not be construed so as to exempt a contractor from any otherwise applicable requirement imposed upon the contractor by the California Labor Code.

1.1 GOOD FAITH EFFORT
A bidder or contractor who fails to meet the goal of having 50 percent of its work force be residents of Stockton shall, nevertheless, be deemed to have made a "good faith effort" to hire sufficient numbers of residents of Stockton if, prior to execution of the contract with the City, six (6) or more of the following employee recruitment activities have been undertaken and documented:

EXHIBIT 2 362
Supplementary Conditions
00800-2
(A) Placing a valid job order for existing and projected position vacancies with the local office of the State Employment Development Department, for no less than 10 consecutive calendar days.
(B) Placing a valid job order for existing and projected position vacancies with Worknet of San Joaquin County, for no less than 10 consecutive calendar days. (C) Advertising existing and projected position vacancies, job informational meetings, job application workshops, job application centers and job interviews by posting notices which identify the positions to be filled, the qualifications required, and where to obtain additional information about the application process, in conspicuous local authorized public places, including but not limited to the City Hall, schools, post offices, libraries, and senior citizens' centers.
(D) Conducting a job informational meeting to inform the community of employment opportunities of the contractor, to be held at a City or other public facility (may be combined with other contractors).
(E) Providing ongoing assistance to Stockton residents in completing job application forms. (F) Conducting a job application workshop to assist the community in applying and interviewing for jobs in the contracting industry, to be held at a City or other public facility (may be combined with other contractors).
(G) Establishing a job application center located in the City of Stockton, where job applications may be obtained, delivered to and collected.
(H) Conducting job interviews within 10 miles of the location designated for contract performance.
(I) Advertising valid existing and projected position vacancies through the local media, such as community television network, local newspapers of general circulation, and trade papers or minority focus newspapers.
(J) Telephone solicitation of known potential local subcontractors or employees. (K) Any other means of obtaining employees who are residents of Stockton that are reasonably calculated to comply with the goals of this ordinance.

1.2 REQUIRED DOCUMENTATION
The contractor shall keep, and provide to the City, on standardized forms acceptable to the City, an accurate record showing the name, place of residence, hours employed and per diem wages and benefits of each person employed by the contractor, and the contractor's subcontractors, on the specific public works project, including full-time, part-time, permanent and temporary employees.

The contractor shall keep, and provide to the City, on forms acceptable to the City, an accurate record, documenting the contractor's good faith efforts to comply with the local resident employment and apprentice employment provisions of this Section. Said records shall include: a listing by name and address of all local recruitment sources contacted by the contractor; the date of the local EXHIBIT 2 363
Supplementary Conditions
00800-3
recruitment contact and the identity of the person contacted; the trade and classification and number of employment referrals requested; the number of local residents employed as a result of the contact; and the identity and address of the person(s) employed pursuant to the contact.

1.3 FORMS SUBMITTED UNDER PENALTY OF PERJURY
All forms required under this Section shall attest to the veracity of the information set forth therein and shall be submitted under penalty of perjury.

1.4 IRRESPONSIBLE BIDDER DECLARATION
Should any contractor or subcontractor fail to abide by the good-faith local resident employment and apprentice employment provisions of this Section, the contractor or subcontractor may be declared by the City to be an irresponsible bidder on future projects pursuant to Section 3.72.010 of this Code.

1.5 BINDING ON SUBCONTRACTORS
The good-faith local resident employment and apprentice employment provisions of this Section shall bind the contractor both with respect to persons employed directly by the contractor and to all persons employed by the contractor's subcontractors. The contractor shall be responsible for assuring that all subcontractors document said compliance by submitting, and making available to the City, the forms required by this Section.

City Council and Concurrent AuthoritiesMay 23, 2023

City Council and Concurrent Authorities
May 23, 2023