Twentynine Palms City Council
June 23, 2026

AMENDED AGENDA
Added Proclamations: Juneteenth Independence Day and LGBTQ+ Pride Month

TWENTYNINE PALMS CITY COUNCIL

REGULAR MEETING AGENDA
6136 Adobe Road
Twentynine Palms, CA 92277
www.29palms.org
Tuesday, June 23, 2026
NOTICE IS HEREBY GIVEN, that the City Council will hold a Regular Meeting on Tuesday, June 23, 2026 at City Hall, 6136 Adobe Road, Twentynine Palms, CA 92277 to consider the following:

REGULAR SESSION AGENDA
6:00 P.M.

CALL TO ORDER
Pledge of Allegiance.

Invocation - Deacon Nathan Foley of Set Free Church-Wonder Valley.

Roll Call.

Closed Session Announcements.

Changes to the Agenda.

ANNOUNCEMENTS
These proceedings may be viewed on demand on the City of Twentynine Palms website at www.29palms.org.

You may also Live Stream this meeting by going on our website and clicking on the "Meeting Agendas" link.

AWARDS, PRESENTATIONS, APPOINTMENTS AND PROCLAMATIONS

1. Cash for Trash Presentation to Twentynine Palms High School Impact/Host Club and Explorer Scouts Post 509.

2. Proclamation Recognizing June 2026 as JUNETEENTH INDEPENDENCE DAY Proclamation Recognizing June 2026 as JUNETEENTH INDEPENDENCE DAY 7 3. Proclamation Recognizing June 2026 as LGBTQ+ Pride Month Proclamation Recognizing June 2026 as LGBTQ+ Pride Month 9

4. Update by Groundwork Arts on the City Tile Mural Project at Freedom Plaza.

COUNCIL COMMENTS AND REPORTS OF MEETINGS ATTENDED

CITY MANAGER UPDATE

CONSENT CALENDAR
All matters listed under the Consent Calendar are to be considered routine by the City Council and will be enacted by one motion in the form listed. Any item may be removed from the Consent Calendar and considered separately by the City Council. The public will be given an opportunity to comment on Consent Calendar items prior to the City Council action

5. Waive the Reading of Ordinance and Approve the Reading by Title Only.

6. Approval of Minutes of the City Council Meeting Held on June 9, 2026.

City Council - Regular Meeting with Closed Session - 09 Jun 2026 - Minutes - Pdf 11 - 15

7. Hatch Road and Sullivan Road Bike Path Project - Contract Extension.

RECOMMENDATION: The City Council approve the request for a one-year extension of awarded contract to HRGreen Pacific for the "Hatch Road and Sullivan Road Bike Path Project” which is set to terminate on June 30, 2026.

Hatch Road and Sullivan Road Bike Path Project - Contract Extension. - Pdf 17 - 19

8. Sidewalk Improvement Agreement on 5152 Adobe Road (Ace Hardware).

RECOMMENDATION: The City Council authorize the City Manager, based on the City Engineer's recommendation, to enter into a reimbursement agreement for the installation of sidewalks, curbs and gutters and driveway approaches on the frontage of 5152 Adobe Road.

Sidewalk Improvement Agreement on 5152 Adobe Road (Ace Hardware). - Pdf 21 - 24

9. Selection of an Investment Strategy for the Pension Prefunding Side of the City's Section 115 Combo Trust with PARS and Approval of Contributions into this Trust.

RECOMMENDATION: The City Council:

1. Approve the selection of a Balanced-Strategic Blend investment strategy for the Pension Prefunding side of the City's Section 115 Combo Trust administered by Public Agency Retirement Services (PARS);

2. Approve the contributions into the Pension Prefunding side of the City's Section 115 Combo Trust; and

3. Authorize and direct the City Manager to execute the necessary documents to initiate the process of selecting the investment strategy and contributing into the Pension Prefunding side of the City's Section 115 Combo Trust.

Selection of an Investment Strategy for the Pension Prefunding Side of the City's Section 115 Combo Trust with PARS and Approval of Contributions into this Trust. - Pdf 25 - 66

10. Acceptance of Work and Notice of Completion for the 2026 Chip Seal Project.

RECOMMENDATION: That the City Council:

1. Accept the work completed by Pavement Coating Co. as part of the abovementioned project for a total contract cost of $308,460.28.

2. Direct the City Clerk to file the Notice of Completion for the contract work.

3. Direct the Finance Director to release the retained funds 30 days after the Notice of Completion has been filed, provided no claims are filed against the contractor.

4. Acceptance of Work and Notice of Completion for the 2026 Chip Seal Project. - Pdf 67 - 70

11. Adoption of an Election Resolution Calling and Giving Notice of a General Municipal Election.

RECOMMENDATION: The City Council adopt Resolution No. 26-___, a Resolution calling and giving notice of a General Municipal Election on November 3, 2026, for the election of certain officers for Districts 3, 4, and 5 and requesting consolidation of the Municipal Election with the Statewide General Election.

Adoption of an Election Resolution Calling and Giving Notice of a General Municipal Election. - Pdf
71 - 74

12. Information on the Importance of Periodic Septic System Maintenance.

RECOMMENDATION: The purpose of this agenda item is to make the public aware of the vital need to periodically inspect and maintain your septic system. Proper maintenance will help protect the City's water supply and may help residents avoid expensive repairs. The EPA recommends having a professional inspect your system at least every three years and pump out the system every three to five years. Do your part to protect our water supply!
Information on the Importance of Periodic Septic System Maintenance. - Pdf 75 - 81

13. Senate Bill 707 (SB707) Introduction of Policies Related to Brown Act Changes.

RECOMMENDATION: The City Council:
1). Receive and file information on SB707; and
2). Review, discuss and provide recommendations to Staff on the new policies. Draft policies will be distributed prior to the City Council meeting.

Senate Bill 707 (SB707)Introduction of Policies Related to Brown Act Changes. - Pdf 83 - 84

ITEMS REMOVED FROM CONSENT CALENDAR FOR DISCUSSION

PUBLIC HEARINGS

14. Proposed Budget Revisions for Special Revenue Funds, Capital Projects Funds, and Successor Agency Fund for Fiscal Year 2026-27.

RECOMMENDATION: The City Council approve the following:

1. Resolution No. 26-__, adopting the budget revisions for the Special Revenue Funds (excluding Project Phoenix Funds), Capital Projects Funds, and Successor Agency Fund for FY 2026-27.

2. Interfund transfers for FY 2026-27 as follows:
 $10,000 from the Gas Tax Fund to the General Fund for Admin fees.  $20,000 from the Measure I Fund to the General Fund for Admin fees.  $27,040 from the Successor Agency Fund to the General Fund for Admin fees. 85 - 121

3. Changes to the FY 2025-26 budget for the following funds:
 Amendments to the General Capital Projects Fund
 Establishment and adoption of the new Elm Avenue Project Fund and related budget.

Proposed Budget Revisions for Special Revenue Funds, Capital Projects Funds, and Successor Agency Fund for Fiscal Year 2026-27. - Pdf

15. Proposed Budget Revisions for Project Phoenix Funds and Enterprise Fund for Fiscal Year 2026-27.

RECOMMENDATION: The City Council approve the following:

1. Resolution No. 26-__, approving the budget revisions for the Project Phoenix Funds and Enterprise Fund for FY 2026-27;

2. Interfund transfers from the General Fund to the Sewer Fund for FY 2026-27 as follows:
 $70,000 to subsidize the operating costs of this fund.  $25,000 for a sewer rate study

Proposed Budget Revisions for Project Phoenix Funds and Enterprise Fund for Fiscal Year 2026-27. - Pdf
123 - 137

DISCUSSION AND POTENTIAL ACTION ITEMS

16. Update on a Local Sales Tax Ballot Measure for the November 3, 2026, General Election.

RECOMMENDATION: The City Council receive this update on community engagement and public opinion research on a potential 1% sales tax measure for the City of Twentynine Palms and provide direction for returning for legislative action.

Update on a Local Sales Tax Ballot Measure for the November 3, 2026, General Election. - Pdf
139 - 146

FUTURE COUNCIL INITIATED ITEMS

1. Shade Structures around Freedom Plaza and a possible art fixture with “Freedom Plaza” announcing the location.

2. Discussion of a policy regulating the use of City Attorney resources.

3. Discussion on creating a “Recognized Neighborhood Program.”

4. Discussion on the use of City funds for grants and the potential reallocation of housing and homeless funds to grants.

5. Discussion on the next steps of reallocating $1.3 million for housing.

6. Discussion of Code Enforcement and compliance with Proposition 36 and find a pathway to meeting the new guidance issued by Governor Gavin Newson.

7. Discussion about annexing parcels: APN 0634-05-124 and 0634-05-109, also known as Set Free Ranch.

8. Discussion of a possible safe passage with CalTrans around Donnell Hill.

9. Discussion on a collaboration with Liberty Military Housing to update our RHNA numbers.

10. Study Session regarding the FLOCK cameras.

11. Review and revision to Municipal Code 5.08 related to Cannabis uses to bring the City up to par with new legislation and State Law.

PUBLIC COMMENTS
This is the time for the public to address the City Council on issues within the jurisdiction of the City Council that are NOT on this agenda. All comments are to be directed to the City Council and shall not consist of any personal attacks. Members of the public are expected to maintain a professional, courteous decorum during their comments. There is a time limitation of three minutes per person. If you haven’t already done so, please fill out name and address slips and give them to the City Clerk. The City Council is prohibited by State law from taking action or discussing items not included on the printed agenda. Public comments on specific agenda items will be deferred until consideration of the item on the agenda.

ADJOURNMENT
It is the intention of the City of Twentynine Palms to comply with the Americans with Disabilities Act in all respects. If you are a person with a disability who requires a disability-related modification or accommodation in order to participate in a meeting, including auxiliary aids or services, please request such modification or accommodation from the City Clerk at (760) 367-4890 (facsimile). Notification at least 48 hours prior to the meeting will enable the City to make reasonable arrangements to assure accessibility to the meeting. Please advise us at the time whether you will require accommodations to participate in meetings on a regular basis. Any person affected by any application on this agenda may submit their concerns in writing prior to the meeting or appear in person and be heard in support or opposition to the proposal at the time the matter is considered on the agenda. The staff reports, applications and environmental documents may be viewed at either the office of Community Development or the office of the City Clerk, 6136 Adobe Road, from 7:00 a.m. until 6:00 p.m. Monday through Thursday, except legal holidays. The Invocation is given per Policy 10-01, and does not reflect the views of the City but rather is an expression of speech by a private citizen making the presentation. Telephone inquiries may be made at (760) 367-6799. If you challenge any agenda issue in court, you may be limited to raising only those issues that you or someone else raised at the public meeting described in this notice, or in written correspondence delivered to the City of Twentynine Palms at, or prior to, the public meeting.

This notice of agenda is hereby certified to have been posted on or before 6:00 p.m. June 18, 2026.

Cindy Villescas CMC, City Clerk Time/Date

CITY OF TWENTYNINE PALMS

PROCLAMATION
JUNETEENTH INDEPENDENCE DAY 2026
WHEREAS, Juneteenth, also known as “Juneteenth Independence Day,” “Emancipation Day,” “Emancipation Celebration,” and “Freedom Day,” is the oldest known celebration commemorating the ending of slavery in the United States; and has been celebrated by the Black Community for over 150 years; and WHEREAS, President Abraham Lincoln issued the Emancipation Proclamation on January 1, 1863, and declared “that all person held as slaves” within the rebellious state “are, and henceforward shall be free,” paving the way for the passing of the thirteenth amendment, which formally abolished slavery in the United States of America; and
WHEREAS, this day, June 19, has special meaning and is called “Juneteenth” combining the words June and Nineteenth; it marks a time to appreciate the African American experience and encourage the continuous understanding and respect for the suffering of slavery; and WHEREAS, Juneteenth is an observance celebrated with traditions handed down through many generations, including family gatherings and picnics, music, stories told by elders and local historians, speeches, and recognition of prominent individuals who have made significant achievements and contributions to the community; and
WHEREAS, it is a time for reflection and rejoicing, a time for assessment self-improvement, and for planning the future; and
WHEREAS, residents are encouraged to join together in celebration of freedom, family, and community by embodying a spirit of peace, respect, and brotherly love, to honor and salute our City’s rich cultural legacy and diversity.

NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Twentynine Palms does hereby proclaim June 19, 2026, as JUNETEENTH INDEPENDENCE DAY. We recognize Juneteenth Independence Day’s historical significance to the United States and support the continued nationwide celebration. We call upon the residents of Twentynine Palms to take this opportunity to learn more about the past, better understand the experiences that have shaped the United States and recognize the observance of the end of slavery is part of the history and heritage of the United States.

DATED this 19th day of June 2026.
______________________________
Daniel L. Mintz, Mayor

CITY OF TWENTYNINE PALMS

PROCLAMATION
LGBTQ+ PRIDE MONTH 2026
WHEREAS, the City of Twentynine Palms is a welcoming community and an exceptional place to live, work, and visit; and
WHEREAS, the City of Twentynine Palms is strengthened by the diversity of ethnic, cultural, racial, gender, and sexual identities of its residents, all of whom contribute to the vibrant character of our City; and WHEREAS, the City of Twentynine Palms has a diverse Lesbian, Gay, Bisexual, Transgender, Queer/Questioning (LGBTQ+) community and is committed to supporting visibility, dignity, and equality for all community members so that all residents can live free from discrimination; and WHEREAS, the nation was founded on the principle that every individual has infinite dignity and worth, and the Twentynine Palms City Council calls upon the people of this municipality to embrace this principle and work to eliminate prejudice everywhere it exists; and
WHEREAS, while society at large increasingly supports LGBTQ+ equality, it is essential to acknowledge that the need for education and awareness remains vital to end discrimination and prejudice; and WHEREAS, the City of Twentynine Palms commends the bravery and courage of those in the LGBTQ+ community who face adversity and various forms of violence. Continued opposition and oppression against LGBTQ+ peoples make it important for neighbors to stand up and show solidarity and support for our LGBTQ+ residents and the community at large.

NOW, THEREFORE BE IT RESOLVED that the City Council of the City of Twentynine Palms does hereby proclaim June 2026 as LGBTQ+PRIDE MONTH in support of the LGBTQ+ community. We call upon the residents of Twentynine Palms to recognize the achievements of the LGBTQ+ community and celebrate the great diversity of our community.

DATED this 23rd day of June 2026.
______________________________
Daniel L. Mintz, Mayor

TWENTYNINE PALMS CITY COUNCIL
City Council - Regular Meeting with Closed Session MINUTES City Hall, 6136 Adobe Road, Twentynine Palms, CA 92277
www.29palms.org
June 9, 2026

CLOSED SESSION AGENDA
5:30 P.M.

CALL TO ORDER - Mayor Mintz called the Closed Session at 5:30p.m.

Roll Call - The following Councilmembers were present: Bilderain, Ramirez, Scott, Mintz. Wright recused himself from Closed Session due to a possible conflict of interest.

Adjourn to Closed Session - Mayor Mintz adjourned to Close Session at 5:31 p.m.

CLOSED SESSION
Anticipated Litigation, Significant Exposure to Litigation, Gov. Code Section 54956.9(d)(2) (1 case).

REGULAR SESSION AGENDA
6:00 p.m.

CALL TO ORDER - Mayor Mintz called the meeting to order at 6:00 p.m.

Pledge of Allegiance - C.J. Horn led the Pledge of Allegiance.

Invocation - Pastor LeeAnn Clarke, 29 Palms Ministerial Association, provided the Invocation.

Roll Call - The following Councilmembers were present: Bilderain, Ramirez, Scott, Wright, Mintz.

Closed Session Announcements - Mayor Mintz made the following motion which was seconded by Mayor Pro Tem Scott and approved on a vote of 4-0 (with Councilmember Wright abstaining from participation due to a potential conflict of interest): That the City not take formal action to pursue collection of the amount of $31,982.08 due to the City by Morongo Basin ARCH related to its former agreement related to the City's Elm Avenue property.

Changes to the Agenda - None.

ANNOUNCEMENTS
Mayor Mintz announced that these proceedings may be viewed on demand on the City of Twentynine Palms website at www.29palms.org. You may also Live Stream this meeting by going on the City website and clicking on the "Meeting Agendas" link.

AWARDS, PRESENTATIONS, APPOINTMENTS AND PROCLAMATIONS
Presentation by the Public Arts Advisory Committee (PAAC).

Sara Lyons, PAAC Chair, presented the Arts Advocate of the Year Award to Ms. Anna Stump, for her contributions to local art and culture.

City Council - Regular Meeting with Closed Session
June 9, 2026

COUNCIL COMMENTS AND REPORTS OF MEETINGS ATTENDED
Councilmember Bilderain mentioned that he attended the Quarterly Pelican Dinner, the High School Graduation and the Junior High Promotion Ceremony.

Councilwoman Ramirez mentioned that she attended the Pelican Dinner, CalCities' City Leaders Summit, the Morongo Unified School District's (MUSD) Summer Meal Kickoff, she met with a military spouse and her husband to advocate through Congress for completion of her immigration status, and she attended a webinar on Care, Community, Resilience, and Advocacy through the Department of Justice.

Councilmember Wright commented that he attended the Amazon check presentation in Indio benefiting FIND Regional Food Bank in support of our Summer Hunger Relief efforts, he attended the JPA meeting, and he had the opportunity to attend the Celebration of Life for Ms. Marjorie Smith. He mentioned he also attended the Basin Transit meeting and the Twentynine Palms High School Graduation, the Junior High Promotion Ceremony, and the Twentynine Palms Elementary Pre-K graduation. He mentioned that he did a Farmer's Market tour, in Palm Springs, Joshua Tree and Twentynine Palms and he feels that our Farmer's Market is the best by far. He attended the Ribbon Cutting Ceremony for the new kitchen at Twentynine Palms Junior High and the MUSD's Summer Lunch Program Kickoff. He wished his wife Alfreda a Happy Birthday.

Mayor Pro Tem Scott mentioned that he attended the Pelican Club Dinner, the Ribbon Cutting Ceremony for the new kitchen at Twentynine Palms Junior High, the Junior High Promotion Ceremony, the MUSD Summer Meal Program Kickoff and he met with constituents.

Mayor Mintz commented that he attended the High School Graduation, the Basin Transit meeting, the MDAQMD meeting in Victorville, the MUSD's Summer Meal Program Kickoff and the Copper Mountain College graduation.

CITY MANAGER UPDATE
City Manager Cole provided the following updates: Swim lessons and Summer Day Camp have kicked off, June 6th was "Adopt a Pet Day" and our local Palms n Paws Animal Shelter participated by offering free adoptions for pets in our shelter. He mentioned that five (5) dogs and five (5) cats were adopted that day. The Public Works Department is finishing up the Chip Seal project along Utah Trail and Condor Road, and the Planning Department, through our City Engineer, has applied for an active Transportation project grant, which will help finish some of our sidewalks from the High School down past Oasis Elementary. He provided an update on a few Future Council Initiated Items, particularly AB1383.

CONSENT CALENDAR
Waive the Reading of Ordinance and Approve the Reading by Title Only.

Approval of Minutes of the City Council Meeting Held on May 26, 2026.

Approval of Warrant Register Totaling $2,424,428.26.

Second Reading of Ordinance No. 328, which would Increase City Council Monthly Compensation to $700.

RECOMMENDATION: The City Council hold a second reading and adopt Ordinance No. 328 entitled:

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF TWENTYNINE PALMS,

CALIFORNIA, APPROVING AN INCREASE IN COMPENSATION FOR MEMBERS OF THE CITY COUNCIL TO TAKE EFFECT AFTER THE NOVEMBER 2026 MUNICIPAL ELECTION AND AMENDING TWENTYNINE PALMS MUNICIPAL CODE SECTION 2.04.020 ACCORDINGLY.

City Council - Regular Meeting with Closed Session
June 9, 2026
Information on the Importance of Periodic Septic System Maintenance.

RECOMMENDATION: The purpose of this agenda item is to make the public aware of the vital need to periodically inspect and maintain your septic system. Proper maintenance will help protect the City's water supply and may help residents avoid expensive repairs. The EPA recommends having a professional inspect your system at least every three years and pump out the system every three to five years. Do your part to protect our water supply!.

Approval of Three-Year Granicus Subscription and Services Agreement for the Visit 29 Palms TBID.

RECOMMENDATION: The City Council:

1. Approve the three-year Granicus Subscription and Services agreement for the Visit 29 Palms TBID.

2. Authorize the City Manager to execute all documents necessary to fully execute the agreement.

Emergency Repair of the Well at Luckie Park.

RECOMMENDATION: The City Council approve the emergency expenditures to Chambers Choice Drilling in the amount of $28,231.00 for the repair of the Luckie Park's southeast well.

Adopt Fiscal Year 2026-27 SB1 Road Maintenance and Rehabilitation Account (RMRA) Project List Resolution.

RECOMMENDATION: The City Council adopt Resolution No. 26-17 identifying the project(s) to be funded with SB1 RMRA funding for Fiscal Year (FY) 2026-27.

ACTION: A motion was made by Councilmember Wright, seconded by Mayor Pro Tem Scott, to approve the Consent Calendar as submitted.

The above motion was carried by the following:

ROLL CALL VOTE:

AYES: BILDERAIN, RAMIREZ, SCOTT, WRIGHT, MINTZ
NOES: NONE
ABSTAIN: NONE
ABSENT: NONE
ITEMS REMOVED FROM CONSENT CALENDAR FOR DISCUSSION - None.

PUBLIC HEARING
Adoption of a Resolution Authorizing the Placement of Solid Waste Handling Service Charges on the County Property Tax Roll, and Approving a Related Agreement with the County.

RECOMMENDATION: The City Council adopt Resolution 26-17, authorizing inclusion of charges for solid waste services on the County tax rolls and approve a related agreement with the County for doing so.

Mayor Mintz opened the Public Hearing.

Having no requests to speak, Mayor Mintz closed the Public Hearing.

ACTION: A motion was made by Councilmember Wright, seconded by Councilmember Bilderain, to adopt Resolution 26-17, authorizing inclusion of charges for solid waste services on the County tax rolls and approve a related agreement with the County for doing so.

City Council - Regular Meeting with Closed Session
June 9, 2026
The above motion was carried by the following:

ROLL CALL VOTE:

AYES: BILDERAIN, RAMIREZ, SCOTT, WRIGHT, MINTZ
NOES: NONE
ABSTAIN: NONE
ABSENT: NONE

DISCUSSION AND POTENTIAL ACTION ITEMS
Support for Co-sponsored California Public Records Act Bill - AB1821.

City Manager will present this item.

City Manager Cole presented the item which relates to the Public Records Act. He provided information to the City Council and asked the City Council to provide direction.

Cindy Bernard addressed the City Council about this item.

ACTION: A motion was made by Mayor Pro Tem Scott, seconded by Councilmember Wright, to direct the City Manager to draft a letter of support for this item on behalf of the City Council.

The above motion was carried by the following:

ROLL CALL VOTE:

AYES: BILDERAIN, RAMIREZ, SCOTT, WRIGHT, MINTZ
NOES: NONE
ABSTAIN: NONE
ABSENT: NONE
Receive Report Outlining Polling Results, Review Ballot Measure Language and Resolution, and Other Considerations Related to a Local Sales Tax Ballot Measure.

RECOMMENDATION: The City Council receive this report on community engagement and public opinion research on a potential 1% sales tax measure for the City of Twentynine Palms and provide direction for returning for legislative action on June 23, 2026.

City Manager Cole presented the Staff Report, providing results and information from a recent survey that was sent out to the community. He then passed the floor to representatives from Clifford Moss, a leading California strategic communications firm, specializing in election consulting, political strategy, and public communications services. A timeline to put this tax measure on the November ballot was also provided.

FUTURE COUNCIL INITIATED ITEMS

1. Shade Structures around Freedom Plaza and a possible art fixture with “Freedom Plaza” announcing the location.

2. Discussion of a policy regulating the use of City Attorney resources.

3. Discussion on creating a “Recognized Neighborhood Program.”

4. Discussion on the new Federal holidays to coincide with the City’s holiday schedule.

5. Discussion on the use of City funds for grants and the potential reallocation of housing and homeless funds to grants.

6. Discussion on creating guidelines for the use of City Hall meeting rooms by elected and appointed officials for official city business.

7. Discussion on the next steps of reallocating $1.3 million for housing.

8. Discussion of Code Enforcement and compliance with Proposition 36 and find a pathway to meeting the new guidance issued by Governor Gavin Newson.

City Council - Regular Meeting with Closed Session
June 9, 2026

9. Discussion about annexing parcels: APN 0634-05-124 and 0634-05-109, also known as Set Free Ranch.

10. Discussion of a possible safe passage with CalTrans around Donnell Hill.

11. Discussion on a collaboration with Liberty Military Housing to update our RHNA numbers.

12. Study Session regarding FLOCK cameras.

13. Expedited item to discuss the Cooling Center hours.

14. Review and revision to Municipal Code 5.08 related to Cannabis uses to bring the City up to par with new legislation and State Law.

Mayor Pro Tem Scott asked to remove item #6 as he has already discussed this with the City Manager and there is already a policy in place that the City Manager will manage. City Manager Cole mentioned that items 13, as this can be administered internally, and item #4 will also be removed as we can move forward with our current policy and address any changes in holidays authorized by the President when that happens.

PUBLIC COMMENTS
The following addressed the City Council:

Chris Carraher
Beth Sheffield
Paul Nugent
Stacey Solie
Cindy Bernard
LeeAnn Clarke
The following sent in a Public Comment via email:

Heather Huguenor
BreeAnna Sullivan
Mayor Mintz announced that the City Council will go dark for the July 14, 2026, meeting and the August 11, 2026.

ADJOURNMENT - Mayor Mintz adjourned the meeting at 7:02 p.m.

Respectfully submitted,
Cindy Villescas, CMC
City Clerk/Public Information Officer

STAFF REPORT
TO: City Council
FROM: City Engineer
FOR MEETING: Jun 23 2026
SUBJECT: Hatch Road and Sullivan Road Bike Path Project - Contract Extension.

RECOMMENDATION:

The City Council approve the request for a one-year extension of awarded contract to HRGreen Pacific for the "Hatch Road and Sullivan Road Bike Path Project” which is set to terminate on June 30, 2026.

ORDER OF PROCEDURE:

Request Staff Report (City Engineer Presenting)
Council Question of Staff
Request Public Comment
Council Discussion
Motion/Second
Discussion of Motion
Call the Question
ATTACHMENTS:
• sch-20260604-
Hatch_Sullivan_Bike_Path
BACKGROUND:

The City of Twentynine Palms received State-Only MPO funding as part of ATP Cycle 6 funding for PA&ED, ROW, PS&E and Construction phases of the Hatch Road and Sullivan Road Bike Path project. The segment is an east-west corridor located south of Twentynine Palms Highway (SR-62) on Sullivan Road and Hatch Road between Morongo Road and Amboy Road. Once completed, the segment will include 2.1 miles of paved shoulders to provide Class II bike lanes and a pedestrian walking area. The City selected HRGreen as the design engineer for this project and was awarded a contract in the amount of $518,930.50 on January 14, 2025. This contract is set to terminate on June 30, 2026 and a one-year extension is allowed if agreed by both parties.

ENVIRONMENTAL:

The contract includes Environmental Services to provide the necessary Environmental Documentation/Clearances for the bike lane project. This portion has been completed at this time.

ALTERNATIVES:

The City Council could choose not to extend the contract.

FISCAL IMPACT:

The City received an ATP grant for $3,480,000 which is programmed to reimburse the City for the following phases:

Preliminary Engineering and Environmental Document. $60,000 Plans, Specifications, and Engineer's Estimates. $220,000 Right of Way. $200,000
Construction $3,000,000
Each phase requires that the City obtain funding obligation from the California Transportation Commission (CTC) and to complete that phase prior to starting and obligating funds for the next phase. Currently, the City has obligated and completed the first phase for $60,000 for the environmental document. Last year, in June, the CTC approved the funding for the next phases, the purchase of rights-of-way and the completion of the Plans, Specifications and Estimates, PS&E, of the project. Once the right of way is obtained, and the plans are finalized, staff will request from the CTC construction funding to complete the project, mid 2027.

SCHEDULE
HATCH ROAD AND SULLIVAN ROAD BIKE PATH6/4/2026

PROJECT MANAGEMENT, COORDINATION, AND MEETINGSPROJECT RESEARCH AND INVESTIGATION Document ResearchSurveying and Base MappingUtility Research, Coordination, and MappingGeotechnical Investigation

PRELIMINARY DESIGN AND RIGHT-OF-WAY REQUIREMENTS
Prepare/Submit Draft Concept Plan Submitted 11/17/25
City Review (2 weeks) Received comments 1/9/26
Prepare/Submit Final Concept Plan Submitted 2/26/26

ENVIRONMENTAL COMPLIANCE
Complete IS/MNDCaltrans Review/Authorization

RIGHT-OF-WAY
Right-of-Way Requirements Map Submitted 2/26/26Prepare Legal Descriptions/Plat Maps Completed 4/7/26Complete Appraisal ReportsAcquisition/Negotiation Services PLANS, SPECIFICATIONS, AND ESTIMATES (65%, 95%, AND FINAL) Prepare/Submit 65% Package
City Review (3 weeks)
Prepare/Submit 95% Package
City Review (3 weeks)
Final Construction Documents
LEGEND
Task SummaryHR Green Phase/TaskCity Review Time
2025

MAYAPR JUN JULMAR FEB MAR APR MAYFEB JUL AUG OCTSEP NOV DEC 2026
Project Phases and Tasks JAN AUG SEP OCT NOV JANDEC JUN

STAFF REPORT
TO: City Council
FROM: Community Development Director
FOR MEETING: Jun 23 2026
SUBJECT: Sidewalk Improvement Agreement on 5152 Adobe Road (Ace Hardware).

RECOMMENDATION:

The City Council authorize the City Manager, based on the City Engineer's recommendation, to enter into a reimbursement agreement for the installation of sidewalks, curbs and gutters and driveway approaches on the frontage of 5152 Adobe Road.

ORDER OF PROCEDURE:

Request Staff Report (Community Development Director
Presenting)
Council Question of Staff
Request Public Comment
Council Discussion
Motion/Second
Discussion of Motion
Call the Question
ATTACHMENTS:
• Letter to K Gardner RE 5152
Adobe Rd
BACKGROUND:

Janet Kodish, Managing Partner for the Morongo Valley High Desert LLC (MVHD LLC, AKA Desert Ace Hardware) submitted a permit application to construct sidewalks, and repair driveway approaches along the frontage of the property at 5152 Adobe Road, at the Desert Ace Hardware. Recent storm water damaged the driveways at this location, and require replacement.

During the encroachment permit inspection process, the City's permit inspector realized that the curb and gutter in front of the ACE hardware store is approximately 4' offset from the existing upstream curbs and gutter, creating a jog in the flow line, see below. To correct the drainage situation and to reduce future potential storm water damage, it would be to the owner's and the City's benefit to realign the curb and gutter along the frontage to the existing curb alignment at the adjacent property.

Ms. Kodish has submitted a written request (attached) to partner with the City, indicating that she is willing to amend her original design to construct the sidewalks and driveways by removing the jog in the flow line.

Adjusting the curb, gutters and sidewalks to align with the upstream infrastructure causes the removal and relocation of the existing curbs and gutters and create the need for pavement widening and street design. These changes create additional costs.

It is proposed that the City design the street plan, advertise the project and provide project construction oversight.

As indicated in the attached letter, "Under this arrangement, MVHD LLC would fund the concrete work, including the driveways and sidewalks while the City would cover the roadwork and traffic management."

For about 20 years, the City collected a "Street Improvement In-lieu Fee" from new developments based on the length of street frontage of the lot on which the development occurred. Over the years, those funds have accumulated to $312,487 as of June 10, 2026, and were deposited into the Curb, Gutter, & Sidewalk Impact Fee Fund. It is the intent of this fund to improve roads, curbs, gutters, and sidewalks throughout the City. However, starting in July 2024, the City switched from collecting a "street improvement in-lieu fee" to a "development impact fee", which has specific roads that are targeted for improvement.

In accordance with Government Code Section 66001 (e), if the City determines that sufficient funds have been collected to complete financing on incomplete improvements for which impact fee revenue is to be used, it must, within 180 days of that determination, identify an approximate date by which construction of the public improvement will be commenced.

A rough estimate shows that this sidewalk would be 165 feet long by about 12 feet wide at its fullest extent. The property owner has expressed an interest in entering into a reimbursement agreement with the City. If this item is approved, the City Engineer will complete the necessary tasks as described above.

ENVIRONMENTAL:

N/A
ALTERNATIVES:

The City Council could provide direction to not move forward with this improvement at this time.

FISCAL IMPACT:

It is anticipated that the City's portion of this will be $60K- $90K, which will be allocated from the Curb, Gutter, & Sidewalk Fund. Once the construction plans are designed, the City Council will review and approve the final design and cost estimates prior to advertising the project for construction. Page 23 of 146 March 26, 2028
Keith Gardner
Community Development Director
City of Twentynine Palms
6136 Adobe Rd.

Twentynine Palms, CA 92277
Dear Mr. Gardner,
As I believe you are aware, Ihave been communicating with City Engineer Richard Pedersen about replacing two concrete driveways at Desert Ace Hardware, located at 5152 Adobe Road. These driveways were damaged during last summer's rainstorm and require replacement. in scoping the project, Ilearned that in addition to the required ADAsidewalk improvements, the curb would need to be brought into alignment with the neighboring Select Storage property at 5182 Adobe. As shown in the attached San Bernardino County parcel map, the 5152 Adobe Road property line extends approximately five feet east into Adobe Road. This additional road work was unexpected, would reduce the usable size of our lot, and would raise the overall cost of the project substantially.
5152 Adobe Road is owned by Morongo Valley High Desert LLC, of which Iam the managing partner.

I am writing to request that the City partner with MVHDLLCto complete this project. Under this arrangement, MVHDLLCwould fund the concrete work, including the driveways and sidewalks, while the City would cover the roadwork and traffic management. Our contractor, Steve Rogers, would coordinate directly with the City on project logistics.

Richard advised that the Street Improvement Impact Fee fund may be available for projects of this nature. Irespectfully request that these funds be considered for the City's portion of the work. This would be a meaningful opportunity to improve the north Adobe Road commercial corridor and benefit the surrounding community.

Please don't hesitate to contact me if you need any additional information.

Sincerely, .
anet Kodish
Managing Partner, Morongo Valley High Desert LLC
CEO, Desert Auto & Hardware Inc. dba Desert Ace Hardware 5152 Adobe Road, 29 Palms, CA 92277
Enclosures:
0 San Bernardino County Parcel Map
0 5152 Adobe Rd Exhibit

STAFF REPORT
TO: City Council
FROM: Finance Director
FOR MEETING: Jun 23 2026
SUBJECT: Selection of an Investment Strategy for the Pension Prefunding Side of the City's Section 115 Combo Trust with PARS and Approval of Contributions into this Trust.

RECOMMENDATION:

The City Council:

1. Approve the selection of a Balanced-Strategic Blend investment strategy for the Pension Prefunding side of the City's Section 115 Combo Trust administered by Public Agency Retirement Services (PARS);

2. Approve the contributions into the Pension Prefunding side of the City's Section 115 Combo Trust; and

3. Authorize and direct the City Manager to execute the necessary documents to initiate the process of selecting the investment strategy and contributing into the Pension Prefunding side of the City's Section 115 Combo Trust.

ORDER OF PROCEDURE:

Request Staff Report (Finance Director Presenting)
Council Question of Staff
Request Public Comment
Council Discussion
Motion/Second
Discussion of Motion
Call the Question
ATTACHMENTS:
• PARS 115 Trust Presentation
BACKGROUND:

The City of Twentynine Palms contracts with the California Public Employees' Retirement System (CalPERS) to provide retirement benefits for qualifying City employees. Each year, we receive actuarial valuation reports, which identify the employer contribution rates for the following year, as well as the Unfunded Accrued Actuarial Liability (UAAL). In June 2018, the City had paid off its UAAL in the amount of $3.1M. However, the City's UAAL has again increased significantly over the past several years due to changes in benefits, reduced earnings, and policy changes enacted by the CalPERS Board, such as reductions to the assumed discount rate, and shorter amortization schedules for these liabilities. The increase in the UAAL results in higher employer contribution rates for the City, which are increasing much more rapidly than the City's growth in revenues. As of the June 30, 2020 CalPERS Actuarial Valuation, the City's UAAL was $1.0M, with a funded ratio of 94.6%. Based on the latest valuation as of June 30, 2024, the UAAL for the City is $2.4M, with a funded ratio of 89.4%. The City's UAAL and required pension contributions are expected to continue to increase in the foreseeable future.

The City also provides Other Post-Employment Benefits (OPEB) to employees, which has traditionally included medical benefits. The City paid for these benefits on a pay-as-you-go basis. As the cost for these benefits increased, and in an effort to mitigate this liability, the City passed Resolution No. 10-09 to prefund the OPEB liability with the California Employers' Retiree Benefit Trust (CERBT) managed by CalPERS.

To help stabilize future pension obligations, many cities have also implemented pension rate stabilization programs through the establishment of Section 115 Pension Trusts. On September 28, 2021, City Council approved Resolution No. 21-18 adopting the establishment of a Section 115 Combination Trust (henceforth Combination Trust) administered by the Public Agency Retirement Services (PARS), and appointed the City Manager as the Plan Administrator for the program. In addition to approving the establishment of the Combination Trust, City Council approved the transfer of the OPEB assets from CERBT to the Combination Trust managed by PARS. At that time, no contributions were made into the pension trust with PARS. The assets from each plan in the Combination Trust cannot be commingled, and no transfers between each plan are allowed since each plan's assets are accounted for individually. The OPEB plan and the Pension plan in the Combination Trust are IRC Section 115 Irrevocable Exclusive Benefit Trusts designed to prefund OPEB and pensions liabilities.

As of March 31, 2026, the Net OPEB Liability (NOL) is super funded by approximately 40.4%, which is well above industry standards. Given the significant excess in NOL funding, the City will request a reimbursement of $231,525.70 from the Section 115 OPEB Trust (OPEB Trust), which will be deposited into the City's General Fund reserves. PARS allows for reimbursement of two-year worth of OPEB expenses (current year plus one year back). CERBT only allowed one year reimbursement of expenses. City Staff will work towards reducing the OPEB funded ratio down to 100%.

In the same way that the City has proactively addressed rising OPEB obligation costs, City Staff recommends prefunding the Pension side of the City's Section 115 Combo Trust (Pension Trust) to help stabilize future pension costs. As mentioned above, a Section 115 Pension Trust serves as a pension rate stabilization program, which will help the City mitigate long-term pension investment volatility and create a more sound retirement system.

Maintaining a Pension Trust with PARS offers many advantages including:
 Complete Local Control over Assets. Agency has complete control over assets, including contributions, disbursements and the timing, amount, and risk tolerance level of investments.  Pension Rate Smoothing Tool. Assets can be transferred to the retirement system at the Agency’s direction, potentially reducing/eliminating large fluctuations in employer contribution amounts.  Rainy Day Fund. Emergency source of funds when employer revenues are strained in difficult budgetary or economic times.
 Diversification. Allows for investment flexibility and offers the potential for assets to earn greater returns than the general fund; spread the risk vs. sending additional money to CalPERS.

Through its Investment Manager, PARS currently offers five investment strategies (Conservative, Moderately Conservative, Moderate, Balanced, and Capital Appreciation) that range from conservative to aggressive tailored to meet an agency's desired risk tolerance. The City has selected a Moderate-Strategic Blend investment strategy for its OPEB Trust; however, since the City is just beginning to build reserves in the Pension Trust and withdrawals are not anticipated in the near future, City Staff recommends selecting a Balanced-Strategic Blend investment strategy for the City's pension plan, which is a more aggressive strategy.

Many cities have adopted formal funding policies to prefund their pension obligations. Given the City's current budget constraints, City Staff recommends prefunding the City's Pension Trust by an amount equal to the reimbursements received from the OPEB Trust for now until the City can find other funding sources.

For additional information regarding the City's OPEB and Pension funding status, please refer to the attached PARS 115 Trust presentation.

ENVIRONMENTAL:

N/A
ALTERNATIVES:

The City Council could choose not to prefund the City's Pension Trust with PARS and redirect the reimbursements from the OPEB Trust to other uses. Page 26 of 146 FISCAL IMPACT:

The reimbursement of $231,525.70 received from the OPEB Trust will be deposited into the City's General Fund reserves and will be subsequently contributed into the City's Pension Trust with PARS. In anticipation of this request, $200,000 has already been budgeted in the City's General Fund for FY 2026-27 to prefund the City's pension obligation, which was approved on May 26, 2026. City Staff will request a budget amendment for the difference at the beginning of next year.

City of Twentynine Palms
Client Review: PARS 115 Trust
May 2026

City of Twentynine Palms ▎2
Pars 115 Trust Team
Trust Administrator & Consultant*
40+
Years of Experience
(1984-2026)
2,300+
Plans under
Administration
1,100+
Public Agency
Clients
$11.2B+
Assets under
Administration
Investment Manager
• A division of U.S. Bancorp Asset Management, Inc.
• Fixed income and multi asset portfolios
• Strategic Blend and Index platform options
• Customized portfolios (with minimum asset level)
41 Years of Investment
Experience
(As of 12/31/2025)
$254.9B *
Assets under Management
& Advisement
Trustee
• 5th largest commercial bank and one of the
nation’s largest trustees for Section 115 trusts
• Safeguard plan assets
• Oversight protection as plan fiduciary
• Custodian of assets
163
Years of Experience
(1863-2026)
$11.0T
Assets under
Administration
550+
115 Trust Clients
• Serves as record-keeper, consultant,
and central point of contact
• Sub-trust accounting
• Coordinates all agency services
• Monitors plan compliance
(IRS/GASB/State Government Code)
• Processes contributions/disbursements
• Hands-on, dedicated support teams
750 K+
Plan Participants
*Please see disclosures at the end of this presentation As of March 31, 2026
* See important information regarding PARS in the Disclaimer page at the end of the presentation.

City of Twentynine Palms ▎3
Subaccounts
OPEB and pension assets are
individually sub-accounted,
and can be divided by dept.,
bargaining group, or cost center.

Assets in the PARS Section 115
Combination Trust can be used
to address unfunded liabilities.

Financial Stability
Allows separate investment
strategies for OPEB and
pension subaccounts.

Flexible Investing
OPEB and pension assets
aggregate and reach lower fees
on tiered schedule sooner –
saving money!
Anytime Access Economies-of-Scale
Trust funds are available
anytime; OPEB for OPEB
and pension for pension.

No set-up costs, no minimum
annual contribution amounts,
and no fees until assets are added.

No Set Up Cost or Minimums
Retiree Medical Benefits
Prefund OPEB GASB 75
OPEB
Reimburse agency; or
Pay benefits provider
Pension Rate Stabilization Program
Prefund Pension (PRSP) GASB 68
Pension
Reimburse agency; or
Pay retirement system
Assets can be used to: Assets can be used to:
prefund
either or both
Agency Funds
PARS IRS-Approved Section 115 Trust

City of Twentynine Palms ▎ 4

OPEB Summary
City of Twentynine Palms ▎5
Plan Type: IRC Section 115 Irrevocable Exclusive Benefit Trust Trustee Approach: Discretionary
Plan Effective Date: September 28, 2021
Plan Administrator: City Manager
Current Investment Strategy: Moderate-Strategic Blend
Summary of Agency’s opebPlan
AS OF MARCH 31, 2026:

Initial Contribution: November 2021: $2,685,207
Additional Contributions: $0
Total Contributions: $2,685,207
Disbursements: ($114,029)
Net Investment Earnings: $475,587
Account Balance: $3,046,765

City of Twentynine Palms ▎6
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
Jun-22 Jun-23 Jun-24 Jun-25 Jun-26
Plan Year Ending
Contributions
Disbursements
Total Assets
Summary of Agency’s opebPlan
*Plan Year Ending June 2022 is based on 8 months of activity. **Plan Year Ending June 2026 is based on 9 months of activity.

HISTORY OF CONTRIBUTIONS, DISBURSEMENTS, AND TOTAL ASSETS AS OF MARCH 31, 2026:

Year Contributions Disbursements Total Assets
Jun-22* $2,685,207 $114,029 $2,229,137
Jun-23 $0 $0 $2,382,786
Jun-24 $0 $0 $2,648,728
Jun-25 $0 $0 $2,899,527
Jun-26** $0 $0 $3,046,765

City of Twentynine Palms ▎7
• We have received the actuarial report by Foster & Foster dated August 28, 2025 with a measurement date as of June 30, 2025. In the table below, we have summarized the results.

OPEB Actuarial Results
Demographic Study Measurement Date
June 30, 2024
Measurement Date
June 30, 2025
Actives 39 40
Retirees 25 24
Total 64 64
Average Active Age 42.1 43.2
Average Active Agency
Service 7.4 8.5

City of Twentynine Palms ▎8
OPEB Actuarial Results
Measurement Date
June 30, 2024
Discount Rate: 5.75%
Measurement Date
June 30, 2025
Discount Rate: 5.75%
Total OPEB Liability (TOL) $2,363,256 $2,170,271
Fiduciary Net Position $2,648,728 $2,899,527*
Net OPEB Liability (NOL) ($285,472) ($729,256)
Funded Ratio (%) 112.08% 133.60%
Service Cost + Interest $185,644
For FY 2023-24
$187,970
For FY 2024-25
Annual Benefit Payments
(Pay-as-you-Go)
$187,317
For FY 2023-24
$151,466
For FY 2026-27
*As of March 31, 2026, assets at $3,046,765 (approx. ~140.37% funded assuming no change in TOL).

Rule of thumb: For every one percent increase in the discount rate, the unfunded liability is lowered by 10-12%.

City of Twentynine Palms ▎9
-15.00%
-10.00%
-5.00%

0.00%

5.00%

10.00%

15.00%
Jun-22Jun-23Jun-24Jun-25Jun-26
Plan Year Ending
AS OF MARCH 31, 2026
OPEB Plan total Returns
*Plan Year Ending June 2022 is based on 8
months of activity.
**Plan Year Ending June 2026 is based on 9
months of activity.

Returns are net of the embedded fund fees and
gross of trustee and trust administrator fees
Information as provided by US Bank, Trustee for PARS; Not FDIC Insured; No Bank Guarantee; May Lose Value. Past performance does not guarantee future results. Performance returns are impacted by agency plan activity and may not reflect the deduction of applicable fees, which could reduce returns. Information is deemed reliable but may be subject to change.

The advisor to the PARS portfolios is U.S. Bank, and PFM Asset Management serves as sub-advisor to U.S. Bank to manage these portfolios. Please see important additional disclosures to the PARS portfolios included in the individual strategy information at the end of this presentation.

Inception to Date (Annualized)

4.54%
Year Returns
Jun-22* -12.93%
Jun-23 7.51%
Jun-24 11.82%
Jun-25 10.13%
Jun-26** 5.53%

City of Twentynine Palms ▎10

OPEB Investment Review
PARS OPEB and Pension Trust Moderate Strategic Blend
Client Management Team
PFM Asset Management
A division of U.S. Bancorp Asset Management, Inc.
1 California Street
Suite 1000
San Francisco, CA 94111
1735 Market Street
43rd Floor
Philadelphia, PA 19103
Investment Performance Review
For the Quarter Ended March 31, 2026
PFM Asset Management

*A division of U.S. Bancorp Asset Management, Inc.
**As of December 31, 2025. Public sector includes government, pool, and TERM. Total assets under management for U.S. Bancorp Asset Management, Inc. were $416.4 billion.

About PFM Asset Management*
40+ years of experience in the
public sector**
$177.2b in public sector assets
under management**
Our Investment Solutions
• Outsourced Chief Investment Officer
(OCIO): Multi-asset class portfolios for
institutional investors
• Fixed Income: High-quality, short- and
intermediate-term portfolios for operating
funds, reserves, working capital, selfinsurance funds and bond proceeds • Local Government Investment Pools
(LGIPs): services for programs with
options ranging from fully liquid cash
management to a fixed-rate, fixed-term
investment
• Specialized Solutions: Arbitrage rebate,
escrow restructuring, bond proceeds
investments, structured investments
42%
41%
17%
Assets by Investment Solution1
Fixed Income
LGIPs
OCIO
1Illustrates public sector assets under management by investment solution as of December 31, 2025. Total may not add up to 100% due to rounding. 1

Financial Markets & Investment Strategy Review
2

QUARTERLY MARKET SUMMARY
For the Quarter Ended March 31, 2026
Multi-Asset Class Management
Index or Average Name QTD YTD One Year Three
Year Five Year Seven
Year Ten Year

DOMESTIC EQUITY
S&P 500 (TR) -4.33% -4.33% 17.80% 18.30% 12.06% 14.43% 14.15% Russell 3000 -3.96% -3.96% 18.09% 17.84% 10.86% 13.80% 13.71% Russell 1000 Growth -9.78% -9.78% 18.81% 21.16% 12.75% 16.95% 16.82% Russell 1000 -4.18% -4.18% 17.74% 18.12% 11.33% 14.15% 13.96% Russell 1000 Value 2.10% 2.10% 15.87% 14.29% 9.42% 10.63% 10.57% Russell Midcap 1.29% 1.29% 15.98% 13.32% 7.26% 10.51% 10.90% Russell Midcap Growth -6.35% -6.35% 9.56% 12.73% 5.37% 10.27% 11.68% Russell Midcap Value 3.68% 3.68% 17.62% 13.13% 7.94% 9.86% 9.75% Russell 2000 Growth -2.81% -2.81% 23.58% 12.25% 1.62% 7.67% 9.78% Russell 2000 0.89% 0.89% 25.72% 13.03% 3.77% 8.60% 9.88% Russell 2000 Value 4.96% 4.96% 28.09% 13.78% 5.79% 9.07% 9.60%

INTERNATIONAL EQUITY
MSCI EAFE -1.24% -1.24% 21.27% 13.60% 7.91% 8.85% 8.37% MSCI AC World -3.20% -3.20% 20.01% 16.56% 9.48% 11.61% 11.33% MSCI AC World ex USA -0.71% -0.71% 24.91% 14.48% 7.01% 8.50% 8.37% MSCI AC World ex USA Small Cap -0.48% -0.48% 27.82% 13.66% 5.66% 8.43% 8.00% MSCI EM (Emerging Markets) -0.17% -0.17% 29.55% 14.82% 3.69% 6.58% 7.79%

LISTED REAL ASSETS
FTSE Nareit/Equity REITs - INV 4.80% 4.80% 6.84% 9.09% 5.81% 5.34% 5.57% MSCI U.S. REIT INDEX 4.84% 4.84% 6.79% 9.12% 5.80% 5.37% 5.56% MSCI World Core Infrastructure 7.82% 7.82% 16.11% 10.94% 7.17% 7.03% 8.41%

FIXED INCOME
Bloomberg U.S. Aggregate -0.05% -0.05% 4.35% 3.63% 0.31% 1.56% 1.70% Bloomberg U.S. Government/Credit -0.20% -0.20% 3.86% 3.41% 0.24% 1.65% 1.79% Bloomberg U.S. Intermediate Government/Credit -0.02% -0.02% 4.41% 4.24% 1.33% 2.20% 2.04% Bloomberg U.S. Treasury (1-3 Y) 0.27% 0.27% 3.77% 4.04% 1.82% 2.11% 1.77% ICE BofA U.S. High Yield -0.55% -0.55% 6.90% 8.49% 4.19% 4.94% 6.05% Bloomberg Global Aggregate -1.07% -1.07% 4.26% 2.59% -1.46% 0.19% 0.58%

CASH EQUIVALENT
Bloomberg 3 Month T-Bill 0.87% 0.87% 4.05% 4.80% 3.40% 2.76% 2.29% Source: Investment Metrics. Returns are expressed as percentages. Please refer to the last page of this document for important disclosures relating to this material.

2.1

QUARTERLY MARKET SUMMARY
For the Quarter Ended March 31, 2026
Multi-Asset Class Management

THE ECONOMY
• U.S. real gross domestic product (GDP) grew at a seasonally adjusted annualized rate of 0.7% in the fourth quarter. This modest growth rate largely reflects the temporary effects of the government shutdown in October-November 2025 rather than a material deterioration in underlying private demand, and consumers continue to support growth.

Real final sales to private domestic purchasers (the sum of consumer spending and gross private fixed investment) increased 1.9% during the quarter. • The U.S. labor market saw an uneven start to the year, with 178k jobs added in March following a sharp drop in February and a moderate gain in January. The overall unemployment rate remained relatively stable, edging down to 4.3%, though part of the decline reflects workers leaving the workforce rather than an acceleration in hiring. Initial jobless claims ended the quarter at 202k (week ending March 28), near a two-year low, with continuing claims declining to approximately 1.8 million. Overall, there has been no meaningful increase in layoffs, consistent with a “low-hire, low-fire” environment. • Inflation moderated in the first two months of the quarter. Headline inflation (CPI) increased 2.4% year-over-year (YoY) in February, the lowest level since May 2025. This moderating trend may encounter near-term pressure, as markets are pricing higher March inflation readings amid rising energy prices related to the conflict in the Middle East.

U.S. Unemployment and Monthly Average Continued Claims
Source: Bloomberg.

U.S. GDP Growth
Source: Bloomberg. Light blue bars indicate actual numbers; dark blue bars indicate forecasted estimates. 1,600
1,650
1,700
1,750
1,800
1,850
1,900
1,950
2,000
0%
2%
4%
6%
8%
Mar-21 Mar-22 Mar-23 Mar-24 Mar-25 Mar-26
Thousands

3.8%

4.4%

0.7%

2.4%

1.8%

1.9%

2.0%
-2%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%
Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4
2021 2022 2023 2024 2025 2026
QoQ% Change, SA, Annualized
Source: Bureau of Labor Statistics.
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
Mar-22 Mar-23 Mar-24 Mar-25
YoY% Change
Core CPI CPI
U.S. Inflation Rate
Seasonally Adjusted (SA)

2.2

QUARTERLY MARKET SUMMARY
For the Quarter Ended March 31, 2026
Multi-Asset Class Management
-1.%

0.%

1.%

2.%

3.%

4.%

5.%

6.%
Mar-22 Mar-23 Mar-24 Mar-25 Mar-26
Fed Target Rate ECB Target Rate
Bank of England Target Rate Bank of Canada Target Rate
30 40
50 60
70 80
90 Mar-22 Mar-23 Mar-24 Mar-25 Mar-26
WHAT WE’RE WATCHING
• The Federal Reserve (Fed) held rates steady in the first quarter amid persistent inflation pressures and muted net job creation. Looking ahead, the 2026 dot plot reflects expectations for one rate cut, though the outlook has become more uncertain, as geopolitical developments add complexity to the inflation path.

Outside the U.S., the European Central Bank (ECB) and Bank of England (BOE) also held rates steady during the quarter, while markets continue to assess the likelihood of additional policy action in the months ahead. • U.S. consumer sentiment, as measured by the University of Michigan Survey of Consumers, increased in the first two months of the quarter before retreating toward December levels, as higher gasoline prices and financial market volatility weighed on households’ outlook.
• The first quarter was marked by an escalation of geopolitical conflict involving Iran, which remains an important risk factor for the global economy. Rising energy and commodity prices have increased uncertainty around the duration and magnitude of inflationary pressures. If disruptions to energy and commodity supply chains persist or intensify, risks to global growth could increase, including a higher probability of recession in energy-importing regions.

Global Central Bank Rates
Source: Bloomberg.

U.S. ISM Manufacturing & Services PMI
Source: Bloomberg.
40 42
44 46
48 50
52 54
56 58
60 Mar-22 Mar-23 Mar-24 Mar-25 Mar-26
Manufacturing Services
University of Michigan Consumer Sentiment
Source: Bloomberg.

2.3

QUARTERLY MARKET SUMMARY
For the Quarter Ended March 31, 2026
Multi-Asset Class Management

DOMESTIC EQUITY
• Domestic equity markets, as represented by the S&P 500 Index (S&P) and the Russell 3000 Index, declined in the first quarter, returning -4.3% and -4.0%, respectively. This marked the weakest quarterly performance since 2022, as the geopolitical conflict involving Iran and continued volatility related to artificial intelligence exposure weighed on returns. Following the escalation of the conflict in late February, both indices declined -5.0% during the month of March.
• Within the S&P 500, performance varied widely across sectors, with six of the 11 posting positive returns for the quarter. Energy was the strongest performing sector, returning 38.2%, as supply disruptions contributed to higher prices. Materials (9.7%) and Utilities (8.3%) also posted solid gains.

Consumer Discretionary declined -9.2%, while Financials lagged all sectors, posting a return of -9.5%.
• Large-cap stocks, as represented by the Russell 1000 Index, returned -4.2% during the quarter, as the “Magnificent Seven” experienced double-digit declines (-12.0%). Mid- and small-cap stocks outperformed large caps, with the Russell Midcap and Russell 2000 indices, returning 1.3% and

0.9%, respectively. Value stocks outperformed growth stocks across all capitalizations.
• According to FactSet Earnings Insight as of April 2, 2026, analysts project earnings growth of 13.2% for the first quarter of 2026, up from an initial estimate of 12.8% in December. If realized, this would represent the sixth consecutive quarter of double-digit, YoY earnings growth. Revenue is also expected to grow, with YoY revenue growth currently estimated at 9.7%, the highest rate since 2022. For calendar year 2026, analysts project earnings growth of 17.4%.
• At quarter end, the S&P 500’s 12-month adjusted positive forward price-toearnings (P/E) ratio (includes only positive earnings results for consistency) stood at 21.6 — below its five-year average of 23.1 — as equity prices declined in March while earnings expectations remained elevated. The Russell 2000 Index, which represents small-cap stocks, posted an adjusted positive forward P/E ratio of 18.0, slightly above its five-year average of 17.5.

Source: Bloomberg.

S&P 500 Index Performance by Sector
Periods Ended March 31, 2026
Source: Bloomberg.
*P/E ratios are calculated based on one-year forward estimates and adjusted to include only positive earnings results for consistency.

P/E Ratios of Major Stock Indices*
Consumer
Disc.

Consumer
Staples Energy Financials H'lthcare Industrials Info. Tech Materials Real Estate Telecom Utilities QTD -9.19% 7.68% 38.25% -9.47% -4.88% 4.61% -9.13% 9.73% 2.76% -6.94% 8.26% YTD -9.19% 7.68% 38.25% -9.47% -4.88% 4.61% -9.13% 9.73% 2.76% -6.94% 8.26% 1 Year 11.72% 6.31% 36.32% 0.58% 2.31% 25.01% 29.05% 17.97% 2.33% 32.51% 19.71% -20%
-10%
0%
10%
20%
30%
40%
50%
10 12
14 16
18 20
22 24
26 28
30 Apr-21 Apr-22 Apr-23 Apr-24 Apr-25
S&P 500 S&P 500 5-Year Average
Russell 2000 Russell 2000 5-Year Average

2.4

QUARTERLY MARKET SUMMARY
For the Quarter Ended March 31, 2026
Multi-Asset Class Management

INTERNATIONAL EQUITY
• Markets outside of the United States, as measured by the MSCI ACWI ex-U.S.

Index, also saw the impacts of the conflict in the Middle East, which posted a return of -0.7% for the first quarter, as sharp declines in March offset gains recorded earlier in the year. During March alone, the index returned -10.8%. • Four of the 11 sectors posted positive returns for the quarter. As in the U.S., Energy (28.5%), Utilities (9.2%) and Materials (5.4%) led performance. The weakest sectors were Real Estate (-4.4%), Communication Services (-9.5%), and Consumer Discretionary (-13.3%).
• Developed ex-U.S. markets, as represented by the MSCI EAFE Index, and emerging markets (EM), as represented by the MSCI Emerging Markets Index, returned -1.2% and -0.2%.
• Among the five largest-weighted countries in the MSCI EAFE Index, the MSCI United Kingdom (2.0%) and MSCI Japan (1.4%), indices outperformed the broader index, while MSCI Switzerland (-4.2%), MSCI France (-5.4%), and MSCI Germany (-8.5%) indices underperformed.
• Within EM, MSCI Korea (16.5%), MSCI Taiwan (9.1%), and MSCI Brazil (19.1%) outperformed the MSCI Emerging Markets index, while MSCI China (-8.9%) and MSCI India (-18.1%) underperformed with notable negative returns. While Korea and Taiwan’s posted positive quarterly returns, this is due to extremely strong gains earlier in the quarter which offset pronounced losses in March (-25.5% and -13.0%, respectively)
• Value stocks outperformed growth stocks for the quarter as represented by the broad benchmarks. The MSCI AC World ex-USA Growth Index returned -3.6%, while the MSCI AC World ex-USA Value Index returned 2.1%. Within EM, value stocks (MSCI EM Value) returned 0.7% versus -1.7% for growth. Small-cap stocks, as represented by the MSCI ACWI ex-U.S. Small Cap Index, declined -0.5%. • Equity valuations increased across both emerging and developed markets and now sit modestly above long-term averages. At quarter end, the MSCI EAFE’s adjusted positive forward P/E ratio stood at 15.9, above its five-year average of 15.3. The MSCI Emerging Markets Index ended the quarter at an adjusted positive forward P/E ratio of 11.7, below its five-year average of 13.0.

Source: Bloomberg.

MSCI ACWI ex-U.S. Sectors
Periods Ended March 31, 2026
Source: Bloomberg.
*P/E ratios are calculated based on one-year forward estimates and adjusted to include only positive earnings results for consistency.

P/E Ratios of MSCI Equity Indices*
Consumer
Disc.

Consumer
Staples Energy Financials Healthcare Industrials Info Tech Materials Real Estate Telecom Utilities QTD -13.28% -2.92% 28.55% -3.64% -3.10% -0.20% 4.58% 5.41% -4.37% -9.46% 9.22% YTD -13.28% -2.92% 28.55% -3.64% -3.10% -0.20% 4.58% 5.41% -4.37% -9.46% 9.22% 1 Year -3.84% 6.58% 45.66% 25.71% 9.72% 27.68% 56.95% 43.99% 11.77% 6.77% 36.33% -20%
-10%
0%
10%
20%
30%
40%
50%
60%
70%
8 10
12 14
16 18
20 Apr-21 Apr-22 Apr-23 Apr-24 Apr-25
MSCI EAFE MSCI EAFE 5-Year Average
MSCI Emerging Markets MSCI Emerging Markets 5-Year Average

2.5

QUARTERLY MARKET SUMMARY
For the Quarter Ended March 31, 2026
Multi-Asset Class Management

FIXED INCOME
• The U.S. bond market, as represented by the Bloomberg U.S.

Aggregate Index, returned -0.1% in the first quarter of 2026.

Performance was weighed down by declines in March (-1.8%), as bonds failed to provide diversification benefits during the sell-off amid near-term inflation concerns. Interest-rate volatility increased over the quarter, with the ICE BofA Move Index rising to a nine-month high, reflecting uncertainty surrounding the duration of the geopolitical conflict involving Iran.
• The Bloomberg U.S. Treasury Index also finished the quarter little changed, declining -4 basis points (bps). While the Fed held rates steady, Treasury yields moved higher as investors reassessed the expected timing and pace of future rate cuts. The 30-year Treasury yield rose 7 bps to 4.9%, while the 2-year Treasury rose 32 bps to 3.8%. • Corporate credit generated negative returns across the quality spectrum. The Bloomberg U.S. Corporate Investment Grade Index declined -0.5%, while the ICE BofA High Yield Index returned -0.6%.

Credit spreads widened for both investment-grade and high-yield corporates and now sit above their respective 10-year averages.

Despite near-term pressure, corporate fundamentals remain supported by elevated profit margins, ongoing share repurchases, and continued merger and acquisitions activity. AI-related corporate debt issuance across corporate bonds and bank loans space has drawn increased investor attention during the quarter, reflecting continuing financing demand among technology-oriented issuers.

Source: Bloomberg.

Returns for Fixed-Income Segments
Periods Ended March 31, 2026
Source: Bloomberg.

U.S. Treasury Yield Curve

3.80%

3.94%

4.32%

4.91%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%
3/31/2025
12/31/2025
3/31/2026
3-mo 2-yr 5-yr 10-yr 30-yr
Blmbg U.S.

Aggregate
Blmbg U.S.

Treasury Blmbg U.S. MBS
Blmbg U.S.

Corporate
Investment
Grade
ICE BofA U.S. HY
QTD -0.05% -0.04% 0.40% -0.54% -0.55%
YTD -0.05% -0.04% 0.40% -0.54% -0.55%
1 Year 4.35% 3.25% 5.79% 4.78% 6.90%
-1%
0%
1%
2%
3%
4%
5%
6%
7%
8%

2.6

QUARTERLY MARKET SUMMARY
For the Quarter Ended March 31, 2026
Multi-Asset Class Management

ALTERNATIVES
• Real estate investment trusts (REITs), as measured by the MSCI U.S. REITs Index, returned 4.8% in the first quarter of 2026. Private real estate, as measured by the NCREIF Property Index, gained 1.2% in the third quarter of 2025, marking the fourth consecutive quarter of positive total returns, driven primarily by income, with modest property appreciation also contributing.

Senior Housing was the strongest-performing property type, returning 2.9%, while Office posted a modest gain of 0.9%.
• Listed infrastructure, as represented by the MSCI World Core Infrastructure Index, returned 7.8% in the first quarter of 2026. According to PitchBook, private infrastructure funds posted returns of 2.6% in the third quarter of 2025, generating an annualized return of 10.9% over the five years ended Q3 2025. By the end of the fourth quarter of 2025, 60 private infrastructure funds had raised $193.8 billion, with the majority of the capital flowing to larger-scale strategies focused on long-term demand themes, including artificial intelligence. • By the end of 2025, 200 private debt funds had raised $234.1 billion, with capital increasingly concentrated among fewer, larger funds. Private debt dry powder remained elevated at $618.2 billion as of June 30, 2025. According to Cliffwater, while performance remains positive, returns have moderated, with private debt funds posting a return of 2.5% in the third quarter of 2025. The asset class has generated an annualized return of 10.5% over the past five years. • Private equity fundraising slowed further in 2025, with 578 private equity funds having raised $414.2 billion, marking the weakest annual fundraising environment since 2020. Despite this slowdown, global private equity dry powder — which accounts for the bulk of private capital dry powder — remains elevated at $1.9 trillion as of June 30, 2025. Lower borrowing costs could support exit activity and fundraising in 2026, although sustained geopolitical uncertainty poses an ongoing risk. According to PitchBook, private equity funds returned 1.2% in the third quarter of 2025 and have generated an annualized return of 14.2% for the five years.

Source: NCREIF, PitchBook, Cliffwater.

As of September 30, 2025, the most recent period for which all index data is available.

Returns for Private Capital Assets
Sources: Pitchbook.
* Total capital raised in 2025 as of December 31, 2025 - most recent period for which ALL fundraising data is available.
** Cumulative dry powder as of June 30, 2025 except Infrastructure dry powder which is as of March 31, 2025.

Private Capital Fundraising & Dry Powder
Private Real Estate Infrastructure Private Debt Private Equity QTD 1.22% 2.57% 2.50% 1.19%
YTD 3.76% 6.94% 7.05% 5.08%
1 Year 4.70% 6.98% 10.67% 6.16%
0%
2%
4%
6%
8%
10%
12%
Closed-End
Real Estate Infrastructure Private Debt Private Equity Venture Capital YTD Fundraising ($B)* $93.96 $193.81 $234.06 $414.23 $122.08 Dry Powder ($B)** $400.24 $377.00 $618.16 $1,888.43 $696.35 $0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
$ Billions

2.7

QUARTERLY MARKET SUMMARY
For the Quarter Ended March 31, 2026
Multi-Asset Class Management
Inflation (U.S.):
• The inflation outlook depends on the duration of the
Middle East conflict and degree to which higher
energy and commodity costs raise core goods and
services prices.
• Near-term inflation expectations have increased
due to the higher energy prices while long-run
expectations remain anchored.

Economic Growth (Global):
• Stable consumer and business spending support
growth, offsetting the weakness seen from the U.S.
government shutdown in Q4 GDP.
• Risks to global growth prospects have increased
amid the escalating conflict due to higher energy
prices, supply-chain disruptions, and increased
uncertainty.

Monetary Policy (Global):
• The Fed held rates steady in Q1 amid persistent
inflation pressures and limited net job creation.
• The “dot plot” projects 25 bps of rate cuts in both
2026 and 2027; however, this is predicated on
inflation progress.
• Global central banks remained on pause in Q1, but
energy inflation pressures may necessitate hikes.

Labor Markets (U.S.):
• Labor market conditions continued to cool with net
new job creation close to zero.
• The Fed has framed the combination of limited job
growth and a stable unemployment rate as an
uncomfortable balance.
• Initial jobless claims and layoff rates remain low,
consistent with a continued “low-hire/low-fire”
environment.

Consumer Spending (U.S.):
• Wage growth continues to exceed inflation, but this
gap has narrowed. Energy shocks may compress
real incomes and reduce discretionary spending.
• Lower-income cohorts remained more exposed to
higher energy prices as a larger share of household
budgets are allocated to essentials.
• Higher-income cohorts benefit from strong equity
markets and home prices.

Financial Conditions (U.S.):
• The conflict in the Middle East has tightened
financial conditions. The duration of the conflict and
its impact on the economy will be a key driver of
corporate fundamentals.
• Geopolitical conflict, higher energy prices, and the
evolution of the economy are key risks to watch. At
this time, we view volatility in private credit as
contained and not a systemic risk.

Political/Policy Risks:
• Conflict with Iran and the ongoing geopolitical
uncertainty are impacting risk assets negatively. We
expect geopolitical uncertainty to remain elevated
in the near-term.
• Tariff-related uncertainty and upcoming mid-term
elections in the U.S. also warrant attention.

Valuations:
• Recent sell-off has led to improvement in valuations
across U.S. equities and credit markets.
• Resilient growth, strong earnings growth and profit
margins are supportive of the current valuations.
• Any prolonged disruption to energy or elevated
geopolitical uncertainty warrant caution.

Corporate Fundamentals:
• Earnings growth expectations are positive across
global equities with double digit growth expected
across U.S. and international equity benchmarks.
• In the U.S., M&A and capital spending pickup, tax
changes and rate cuts are positives while any
energy and commodity related cost pressure impact
needs to be monitored.

Factors to Consider Over the Next 6-12 Months
Statements and opinions expressed about the next 6-12 months were developed based on our independent research with information obtained from Bloomberg. The views expressed within this material constitute the perspective and judgment of PFM Asset Management, a division of U.S. Bancorp Asset Management, Inc., at the time of distribution (March 31, 2026) and are subject to change. Information is obtained from sources generally believed to be reliable and available to the public; however, we cannot guarantee its accuracy, completeness, or suitability.

Stance Unfavorable
to Risk Assets
Stance Favorable to
Risk Assets
Current outlook Outlook one quarter ago Positive Slightly Positive Neutral Slightly Negative Negative

2.8

QUARTERLY MARKET SUMMARY
For the Quarter Ended March 31, 2026
Multi-Asset Class Management
Asset Class Our Q2 2026 Investment Outlook Comments
• The duration of U.S.-Iran conflict and its impact on energy supply will impact inflation and growth, rates, and market returns near-term but we expect impact to be more muted in the U.S.
• Underlying fundamentals still supportive of positive equity returns, with economic growth still intact and corporate earnings expected to grow at a high double-digit pace.
• Resilient economic growth, ongoing consumer strength, expected rate cuts, equity market broadening and strong earnings growth led us to modestly overweight domestic small caps in Q1, prior to the U.S.-Iran conflict. The recent pullback has improved attractiveness of valuations relative to historical averages. We maintain the overweight despite elevated uncertainty.

U.S. Equities
Large-Caps
Small-Caps
• International equities are at a higher risk of pullback if energy prices remain elevated. Major central banks outside the U.S. are now expected to hike two to three times this year as near-term inflation pressures rise, reversing earlier expectations for rate cuts.
• Energy-importing developed and emerging market economies are more vulnerable to higher energy prices, leading us to remain neutral. Tariffrelated uncertainty also remains a headwind as alternative tariff mechanisms are considered.

Non-U.S. Equities
Developed Markets
Emerging Markets
• The Fed held rates steady at its March meeting, while the conflict-driven inflation outlook has increased uncertainty around rate cuts. Our base case is that Fed’s next move is a cut rather than a hike. • We continue to monitor increased volatility across fixed income yields.

Absolute yield levels look attractive. Credit spreads have widened slightly. Strong profit margins, continued issuance, continued buybacks and ongoing M&A activity points to healthy corporate sentiment. • We remain neutral across duration and credit sectors.

Fixed Income
Core Bonds
Investment Grade Credit
High Yield Credit
• Listed REITs and listed global infrastructure outperformed domestic and global equities respectively during the March pullback, highlighting their diversification benefits.
• In addition to diversified sources of return, improving AI sentiment continues to support data center and utilities buildout as a tailwind for listed real assets.

Diversifying Assets
Listed Real Estate
Listed Global Infrastructure
Investment Strategy Overview
The view expressed within this material constitute the perspective and judgment of PFM Asset Management, a division of U.S. Bancorp Asset Management, Inc., at the time of distribution (March 31, 2026) and are subject to change.

Current outlook Outlook one quarter ago Positive Slightly Positive Neutral Slightly Negative Negative

2.9

QUARTERLY MARKET SUMMARY
For the Quarter Ended March 31, 2026
Multi-Asset Class Management

SOURCES
Factset
https://www.bea.gov/sites/default/files/2024-12/gdp3q24-3rd-fax.pdf https://www.bls.gov/news.release/pdf/empsit.pdf
https://www.bls.gov/news.release/pdf/cpi.pdf
http://www.sca.isr.umich.edu/
NCREIF
PitchBook
Cliffwater

DISCLOSURES
Indices shown are not available for investment. The index data reference herein is the property of the index provider and/or its licensors. The index provider assumes no liability in connections with its use and does not sponsor, endorse or recommend the products or services contained herein. Index returns do not reflect payment of any sales charges or fees an investor would pay to purchase the securities they represent. The imposition of these fees and charges would cause investment performance to be lower than the performance shown.

The views expressed within this material constitute the perspective and judgment of U.S. Bancorp Asset Management, Inc. at the time of distribution and are subject to change.

Any forecast, projection, or prediction of the market, the economy, economic trends, and equity or fixed-income markets are based upon current opinion as of the date of issue and are also subject to change. Opinions and data presented are not necessarily indicative of future events or expected performance. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. No representation is made as to its accuracy or completeness.

PFM Asset Management serves clients in the public sector and is a division of U.S. Bancorp Asset Management, Inc., which is the legal entity providing investment advisory services. U.S. Bancorp Asset Management, Inc. is a registered investment adviser, a direct subsidiary of U.S. Bank N.A. and an indirect subsidiary of U.S. Bancorp. U.S. Bank N.A. is not responsible for and does not guarantee the products, services, or performance of U.S. Bancorp Asset Management, Inc.

NOT FDIC INSURED : NO BANK GUARANTEE : MAY LOSE VALUE
Further distribution is not permitted without prior written consent.

2.10

Plan Performance Summary
3

Allocation
%
Performance(%)
1 Quarter
Year
To
Date
1 Year
3 Years
5 Years
7 Years
10 Years
Since
Inception
Inception
Date
Total Portfolio 100.00 -0.86 -0.86 11.34 10.10 4.92 6.86 7.04 7.17 02/01/2016 Blended Benchmark -0.93 -0.93 11.72 10.04 5.28 7.09 7.10 7.43 Domestic Equity 30.79 -4.48 -4.48 17.52 16.90 9.58 12.46 12.89 13.34 02/01/2016 Russell 3000 Index -3.96 -3.96 18.09 17.85 10.87 13.81 13.72 14.23 Columbia Contrarian Core Inst3 6.08 -5.61 -5.61 16.41 18.55 11.40 14.77 13.66 14.68 02/01/2024 S&P 500 -4.33 -4.33 17.80 18.32 12.06 14.44 14.16 16.28 Putnam Core Equity Fund Y 2.62 -5.13 -5.13 16.89 19.14 12.13 15.60 15.05 9.13 10/01/2024 Schwab US Large-Cap ETF 19.06 -4.38 -4.38 17.63 18.25 11.41 14.20 14.03 10.03 10/01/2024 S&P 500 -4.33 -4.33 17.80 18.32 12.06 14.44 14.16 10.08 PIMCO RAE US Small Cap Fund 1.56 1.03 1.03 17.26 16.09 10.76 13.53 12.52 1.03 01/01/2026 Russell 2000 Value Index 4.96 4.96 28.09 13.80 5.79 9.08 9.61 4.96 Russell 2000 Index 0.89 0.89 25.72 13.05 3.77 8.60 9.88 0.89 Columbia Small Cap Growth Inst3 0.72 -3.80 -3.80 33.65 18.47 2.19 12.20 14.98 14.12 10/01/2024 Russell 2000 Growth Index -2.81 -2.81 23.58 12.27 1.62 7.68 9.79 7.66 Russell 2000 Index 0.89 0.89 25.72 13.05 3.77 8.60 9.88 9.25 Emerald Growth Institutional 0.75 -0.63 -0.63 49.64 21.43 7.20 11.66 13.36 24.96 02/01/2024 Russell 2000 Growth Index -2.81 -2.81 23.58 12.27 1.62 7.68 9.79 13.14 Russell 2000 Index 0.89 0.89 25.72 13.05 3.77 8.60 9.88 13.70 International Equity 14.68 1.64 1.64 23.64 13.50 5.80 8.34 8.36 8.72 02/01/2016 MSCI AC World ex USA (Net) -0.71 -0.71 24.91 14.49 7.02 8.50 8.38 8.95 MFS International Growth R6 2.20 -3.48 -3.48 12.22 10.40 6.34 8.70 9.47 12.40 02/01/2024 MSCI AC World ex USA (Net) -0.71 -0.71 24.91 14.49 7.02 8.50 8.38 16.85 Fidelity International Index 5.82 0.95 0.95 23.40 14.60 8.59 9.39 8.82 16.66 07/01/2024 MSCI EAFE (net) -1.24 -1.24 21.27 13.62 7.91 8.86 8.38 15.01 Goldman Sachs GQG Ptnrs Intl Opportunities 2.38 4.76 4.76 16.97 16.14 9.70 11.68 N/A 8.18 07/01/2024 MSCI AC World ex USA (Net) -0.71 -0.71 24.91 14.49 7.02 8.50 8.38 16.82 Fidelity Emerging Markets Index Fund 4.28 3.44 3.44 33.31 15.83 4.08 6.89 8.00 18.10 08/01/2025 MSCI EM (net) -0.17 -0.17 29.55 14.84 3.69 6.59 7.80 13.47 Asset Allocation & Performance
PARS OPEB and Pension Trust Moderate Strategic Blend As of March 31, 2026 Returns are gross of investment advisory fees and net of mutual fund fees. Returns are expressed as percentages and for periods over one year are annualized. Asset class level returns may vary from individual underlying manager returns due to cash flows. Total Portfolio returns prior to 1/1/2024 were provided by previous Advisor and believed to be accurate and reliable. Returns for January 2024 were calculated by the legacy performance system of previous Advisor and believed to be accurate and reliable.

3.1

Asset Allocation & Performance
PARS OPEB and Pension Trust Moderate Strategic Blend As of March 31, 2026 Allocation
%
Performance(%)
1 Quarter
Year
To
Date
1 Year
3 Years
5 Years
7 Years
10 Years
Since
Inception
Inception
Date
Other Growth 5.12 5.75 5.75 12.47 N/A N/A N/A N/A 12.29 02/01/2024 Cohen & Steers Inst Realty Shares 2.53 3.65 3.65 3.58 7.70 4.80 6.14 6.46 8.43 06/01/2024 MSCI US REIT Index 4.84 4.84 6.79 9.13 5.80 5.37 5.56 10.98 Lazard Global Listed Infrastructure Inst 1.34 6.96 6.96 24.41 14.47 12.36 10.24 10.11 19.01 10/01/2024 MSCI World Core Infrastructure Index (Net) 7.82 7.82 16.11 10.95 7.17 7.03 8.41 11.07 NYLI CBRE Global Infrastructure 1.25 8.88 8.88 18.61 11.12 7.96 8.04 8.64 15.67 06/01/2024 FTSE Global Core Infrastructure 50/50 Index (Net) 8.14 8.14 17.98 11.25 7.77 7.00 7.71 14.83 Fixed Income 46.64 -0.01 -0.01 4.70 4.52 1.04 2.10 2.23 2.35 02/01/2016 Blmbg. U.S. Aggregate -0.05 -0.05 4.35 3.63 0.31 1.56 1.70 1.83 Baird Aggregate Bond Inst 13.25 -0.06 -0.06 4.35 4.12 0.55 1.93 2.12 5.06 03/01/2024 iShares Core US Aggregate Bond ETF 10.98 0.04 0.04 4.35 3.63 0.31 1.54 1.67 4.89 03/01/2024 Blmbg. U.S. Aggregate -0.05 -0.05 4.35 3.63 0.31 1.56 1.70 4.89 Dodge & Cox Income 7.20 0.04 0.04 5.34 4.99 1.58 2.89 3.11 4.89 02/01/2024 PGIM Total Return Bond R6 7.38 0.02 0.02 4.89 5.08 1.06 2.19 2.69 4.85 02/01/2024 Blmbg. U.S. Aggregate -0.05 -0.05 4.35 3.63 0.31 1.56 1.70 4.01 Voya Intermediate Bond 4.50 0.02 0.02 4.78 4.74 0.79 2.14 2.43 4.40 05/01/2025 Blmbg. U.S. Aggregate -0.05 -0.05 4.35 3.63 0.31 1.56 1.70 3.94 NYLI MacKay High Yield Corp Bond Fund 3.33 -0.21 -0.21 5.62 7.25 4.24 4.88 5.85 6.52 03/01/2024 ICE BofA US High Yield Index -0.55 -0.55 6.90 8.50 4.19 4.94 6.05 7.56 Cash Equivalent 2.76 0.89 0.89 4.05 4.59 3.25 2.58 2.13 2.10 02/01/2016 ICE BofA 3 Month U.S. T-Bill 0.85 0.85 4.00 4.74 3.34 2.72 2.26 2.23 First American Government Obligation - X 2.76 0.89 0.89 4.05 4.75 3.36 2.67 N/A 4.55 02/01/2024 ICE BofA 3 Month U.S. T-Bill 0.85 0.85 4.00 4.74 3.34 2.72 2.26 4.55 Returns are gross of investment advisory fees and net of mutual fund fees. Returns are expressed as percentages and for periods over one year are annualized. Asset class level returns may vary from individual underlying manager returns due to cash flows. Total Portfolio returns prior to 1/1/2024 were provided by previous Advisor and believed to be accurate and reliable. Returns for January 2024 were calculated by the legacy performance system of previous Advisor and believed to be accurate and reliable.

3.2

Performance(%)
2025 2024 2023 2022 2021 2020 2019
Total Portfolio 12.55 9.48 14.07 -14.61 9.29 12.52 17.70 Blended Benchmark 12.38 10.03 13.56 -13.74 10.21 12.02 17.66 Domestic Equity 17.21 21.76 24.55 -18.76 23.40 18.35 29.31 Russell 3000 Index 17.15 23.81 25.96 -19.21 25.66 20.89 31.02 Columbia Contrarian Core Inst3 17.51 23.51 32.21 -18.45 24.45 22.44 33.08 Putnam Core Equity Fund Y 17.31 26.47 27.99 -15.87 30.75 17.66 32.50 Schwab US Large-Cap ETF 17.42 24.90 26.86 -19.44 26.74 20.90 31.40 S&P 500 17.88 25.02 26.29 -18.11 28.71 18.40 31.49
PIMCO RAE US Small Cap Fund 6.29 22.08 20.06 -4.64 40.37 6.88 20.22 Russell 2000 Value Index 12.59 8.05 14.65 -14.48 28.27 4.63 22.39 Russell 2000 Index 12.81 11.54 16.93 -20.44 14.82 19.96 25.53 Columbia Small Cap Growth Inst3 21.86 24.45 26.39 -36.51 -2.54 70.41 41.18 Emerald Growth Institutional 31.95 19.41 19.06 -24.50 4.04 38.85 28.70 Russell 2000 Growth Index 13.01 15.15 18.66 -26.36 2.83 34.63 28.48 Russell 2000 Index 12.81 11.54 16.93 -20.44 14.82 19.96 25.53 International Equity 29.38 4.09 14.02 -15.77 4.68 13.90 23.74 MSCI AC World ex USA (Net) 32.39 5.53 15.62 -16.00 7.82 10.65 21.51 MFS International Growth R6 21.23 9.24 14.96 -15.02 9.65 15.82 27.31 MSCI AC World ex USA (Net) 32.39 5.53 15.62 -16.00 7.82 10.65 21.51 Fidelity International Index 31.96 3.71 18.31 -14.24 11.45 8.17 22.00 MSCI EAFE (net) 31.22 3.82 18.24 -14.45 11.26 7.82 22.01 Goldman Sachs GQG Ptnrs Intl Opportunities 20.84 5.99 21.25 -11.10 12.49 15.77 27.64 MSCI AC World ex USA (Net) 32.39 5.53 15.62 -16.00 7.82 10.65 21.51 Fidelity Emerging Markets Index Fund 33.94 6.80 9.50 -20.07 -3.04 17.82 18.26 MSCI EM (net) 33.57 7.50 9.83 -20.09 -2.54 18.31 18.42
Calendar Year Comparative Performance
PARS OPEB and Pension Trust Moderate Strategic Blend As of March 31, 2026 Returns are gross of investment advisory fees and net of mutual fund fees. Returns are expressed as percentages and for periods over one year are annualized. Asset class level returns may vary from individual underlying manager returns due to cash flows. Total Portfolio returns prior to 1/1/2024 were provided by previous Advisor and believed to be accurate and reliable. Returns for January 2024 were calculated by the legacy performance system of previous Advisor and believed to be accurate and reliable.

3.3

Calendar Year Comparative Performance
PARS OPEB and Pension Trust Moderate Strategic Blend As of March 31, 2026 Performance(%)
2025 2024 2023 2022 2021 2020 2019
Other Growth 11.38 N/A N/A N/A N/A N/A N/A
Cohen & Steers Inst Realty Shares 3.09 6.24 12.72 -24.73 42.47 -2.57 33.01 MSCI US REIT Index 2.95 8.75 13.74 -24.51 43.06 -7.57 25.84 Lazard Global Listed Infrastructure Inst 23.86 6.71 10.89 -1.30 19.87 -4.48 22.26 MSCI World Core Infrastructure Index (Net) 15.85 5.73 4.01 -7.93 17.13 -0.80 26.64 NYLI CBRE Global Infrastructure 15.55 7.68 3.96 -6.08 15.22 1.17 28.46 FTSE Global Core Infrastructure 50/50 Index (Net) 14.36 9.53 2.21 -4.87 14.88 -4.06 25.13 Fixed Income 7.57 2.16 6.95 -12.08 -0.72 7.21 8.23
Blmbg. U.S. Aggregate 7.30 1.25 5.53 -13.01 -1.55 7.51 8.72 Baird Aggregate Bond Inst 7.36 1.85 6.43 -13.35 -1.46 8.63 9.48 iShares Core US Aggregate Bond ETF 7.19 1.37 5.59 -13.06 -1.67 7.42 8.68 Dodge & Cox Income 8.32 2.26 7.70 -10.86 -0.91 9.45 9.73 PGIM Total Return Bond R6 7.79 3.03 7.78 -14.86 -1.15 8.10 11.13 Voya Intermediate Bond 7.62 2.93 7.07 -14.16 -0.99 8.22 10.06 Blmbg. U.S. Aggregate 7.30 1.25 5.53 -13.01 -1.55 7.51 8.72 NYLI MacKay High Yield Corp Bond Fund 7.10 7.14 11.97 -7.81 5.35 5.28 13.03 ICE BofA US High Yield Index 8.50 8.20 13.46 -11.22 5.36 6.17 14.41 Cash Equivalent 4.23 4.73 4.98 1.48 0.02 0.36 2.08
ICE BofA 3 Month U.S. T-Bill 4.18 5.25 5.02 1.46 0.05 0.67 2.28 First American Government Obligation - X 4.23 5.19 5.02 1.52 0.03 0.40 2.12 ICE BofA 3 Month U.S. T-Bill 4.18 5.25 5.02 1.46 0.05 0.67 2.28 Returns are gross of investment advisory fees and net of mutual fund fees. Returns are expressed as percentages and for periods over one year are annualized. Asset class level returns may vary from individual underlying manager returns due to cash flows. Total Portfolio returns prior to 1/1/2024 were provided by previous Advisor and believed to be accurate and reliable. Returns for January 2024 were calculated by the legacy performance system of previous Advisor and believed to be accurate and reliable.

3.4

Allocation Mandate Weight (%)
Jul-2025
Russell 3000 Index 30.00
MSCI AC World ex USA (Net) 15.00
MSCI US REIT Index 2.50
MSCI World Core Infrastructure Index (Net) 2.50
Blmbg. U.S. Aggregate 44.25
ICE BofA US High Yield Index 3.75
ICE BofA 3 Month U.S. T-Bill 2.00
Oct-2012
Blmbg. U.S. Aggregate 33.50
S&P 500 26.50
ICE BofA 1-3 Yr. Gov/Corp 10.00
Russell 2000 Index 7.50
MSCI EAFE (net) 6.00
Russell Midcap Index 5.00
FTSE 1 Month T-Bill 5.00
MSCI EM (net) 3.25
Wilshire US REIT Index 1.75
ICE BofA US High Yield Index 1.50
Apr-2007
S&P 500 43.00
Blmbg. U.S. Aggregate 30.00
ICE BofA 1-3 Yr. Gov/Corp 15.00
FTSE 1 Month T-Bill 5.00
MSCI EAFE (net) 5.00
Russell 2000 Index 2.00
Allocation Mandate Weight (%)
Jul-1986
S&P 500 50.00
Blmbg. U.S. Aggregate 30.00
ICE BofA 1-3 Yr. Gov/Corp 15.00
FTSE 1 Month T-Bill 5.00
*The benchmark for the PARS Moderate strategy defined above was assigned to the PARS OPEB and Pension Trust Moderate Strategic Blend upon its inception on February 2016
Historical Hybrid Composition - PARS Moderate
PARS OPEB and Pension Trust Moderate Strategic Blend As of March 31, 2026

3.5

This material is for general information purposes only and is not intended to provide specific advice or a specific recommendation, as it was prepared without regard to any specific objectives or financial circumstances.

PFMAM professionals have exercised reasonable professional care in the preparation of this performance report. Information in this report is obtained from sources external to PFMAM and is generally believed to be reliable and available to the public; however, we cannot guarantee its accuracy, completeness or suitability. We rely on the client's custodian for security holdings and market values. Transaction dates reported by the custodian may differ from money manager statements. While efforts are made to ensure the data contained herein is accurate and complete, we disclaim all responsibility for any errors that may occur. References to particular issuers are for illustrative purposes only and are not intended to be recommendations or advice regarding such issuers. Fixed income manager and index characteristics are gathered from external sources. When average credit quality is not available, it is estimated by taking the market value weights of individual credit tiers on the portion of the strategy rated by a NRSRO.

It is not possible to invest directly in an index. The index returns shown throughout this material do not represent the results of actual trading of investor assets. Third-party providers maintain the indices shown and calculate the index levels and performance shown or discussed. Index returns do not reflect payment of any sales charges or fees an investor would pay to purchase the securities they represent. The imposition of these fees and charges would cause investment performance to be lower than the performance shown.

The views expressed within this material constitute the perspective and judgment of PFMAM at the time of distribution and are subject to change.

Any forecast, projection, or prediction of the market, the economy, economic trends, and equity or fixed-income markets are based upon certain assumptions and current opinion as of the date of issue and are also subject to change. Some, but not all assumptions are noted in the report.

Assumptions may or may not be proven correct as actual events occur, and results may depend on events outside of your or our control. Changes in assumptions may have a material effect on results. Opinions and data presented are not necessarily indicative of future events or expected performance.

PFM Asset Management serves clients in the public sector and is a division of U.S. Bancorp Asset Management, Inc., which is the legal entity providing investment advisory services. U.S. Bancorp Asset Management, Inc. is a registered investment adviser, a direct subsidiary of U.S. Bank N.A. and an indirect subsidiary of U.S. Bancorp. U.S. Bank N.A. is not responsible for and does not guarantee the products, services, or performance of U.S. Bancorp Asset Management, Inc.

NOT FDIC INSURED  :   NO BANK GUARANTEE   :   MAY LOSE VALUE For more information regarding PFMAM’s services or entities, please visit www.pfmam.com. © 2026 USBAM.. Further distribution is not permitted without prior written consent.

IMPORTANT DISCLOSURES

City of Twentynine Palms ▎22

Pension Funded Status
City of Twentynine Palms ▎23
Plan Type: IRC Section 115 Irrevocable Exclusive Benefit Trust Trustee Approach: Discretionary
Plan Effective Date: September 28, 2021
Plan Administrator: City Manager
Current Investment Strategy: Moderate-Strategic Blend
Summary of Agency’s Pension Plan
AS OF MARCH 31, 2026:

Account Balance: $0.00

City of Twentynine Palms ▎24
Pension Funding Status
As of June 30, 2024, City of Twentynine Palm’s CalPERS pension plan is funded as follows*:
* Data through 2031-32 from Agency’s latest CalPERS actuarial valuation.

Combined Miscellaneous Groups * Valuation as of
June 30, 2023
Valuation as of
June 30, 2024 Change
Actuarial Liability $21.5 M $23.1 M 7.6% ↑
Assets $19.0 M $20.7 M 8.9% ↑
Unfunded Liability $2.50 M $2.44 M 2.3% ↓
Funded Ratio 88.4% 89.4% 1.2% ↑
Employer Contribution Amount
$351.4 K $453.0 K 28.9% ↑ (FY 24-25) (FY 25-26)
Employer Contribution Amount – Projected * --- $607.4 K 34.1% ↑ (FY 31-32)

City of Twentynine Palms ▎25
Why Prefund Pension Obligations?
Complete Local Control over Assets
Agency has complete control over assets, including contributions, disbursements and the timing, amount, and risk tolerance level of investments

1. Pension Rate Smoothing Tool
Assets can be transferred to the retirement system at the Agency’s direction, potentially reducing/eliminating large fluctuations in employer contribution amounts

2. Rainy Day Fund
Emergency source of funds when employer revenues are strained in difficult budgetary or economic times

3. Diversification
Allows for investment flexibility and offers the potential for assets to earn greater returns than the general fund; spread the risk vs. sending additional money to CalPERS

4.

City of Twentynine Palms ▎26
Strategy Equity (%) 1 Year 3 Years 5 Years 10 Years
Capital
Appreciation 65-85% 14.77% 12.89% 6.78% 9.22%
Balanced 50-70% 12.66% 11.15% 5.69% 7.94%
Moderate 40-60% 11.34% 10.10% 4.92% 7.04%
Moderately
Conservative 20-40% 8.76% 7.98% 3.53% 5.16%
Conservative 5-20% 6.61% 6.23% 2.29% 3.67%
Managed Strategies Investment Returns As of March 31, 2026 STRATEGIC BLEND PORTFOLIO ANNUALIZED RETURNS* (Gross of Investment Management Fees, but Net of Embedded Fund Fees) Please see complete Investment Strategy Sheets for more information. *Returns shown are for the respective strategic blend strategy in the PARS OPEB & Pension Combo Trust, except for the Capital Appreciation and Conservative strategies for periods up to 5 years and which have not reached 10 years since inception (10-1-17 and 7-1-16, respectively). Returns for the 10-year period are the Capital Appreciation Index strategy and the Conservative strategic blend strategy, respectively, in the PARS OPEB Trust. Returns provided are gross of investment advisory fees and net of mutual fund fees.

Subject to change due to rebalancing; Past performance does not guarantee future results.

Please see important additional disclosures to the PARS portfolios included in the individual strategy fact sheets.

City of Twentynine Palms ▎27
PFMAM Managed Strategies
Moderate
Balanced Capital Appreciation
Domestic
Equity

36.0%
Int'l Equity

18.0%
Listed Real
Assets

6.0%
Cash

2.0%
Fixed
Income

38.0%
Domestic
Equity

30.0%
Int'l Equity

15.0%
Listed
Real
Assets

5.0%
Cash

2.0%
Fixed
Income

48.0%
Domestic
Equity

45.0%
Int'l Equity

22.5%
Listed
Real
Assets

7.5%
Cash

2.0%
Fixed
Income

23.0%
Expected
Returns *
5-Year, 6.1%
30-Year, 6.3%
Expected
Returns *
5-Year, 6.5%
30-Year, 6.6%
Expected
Returns *
5-Year, 6.9%
30-Year, 7.0%
* Data from PFMAM Managed Strategies: Asset Allocation Summary. Representative as of 2026. Asset allocations and assumptions are subject to change. Please see important disclosures at the end of this presentation for additional information.

Moderately Conservative
Domestic
Equity

18.0%
Int'l Equity

9.0%
Listed Real Assets

3.0%
Cash

2.0%
Fixed
Income

68.0%
Expected
Returns *
5-Year, 5.4%
30-Year, 5.6%
Conservative
Domestic
Equity

9.0%
Int'l Equity

4.5%
Listed Real
Assets

1.5%
Cash

2.0%
Fixed
Income

83.0%
Expected
Returns *
5-Year, 4.8%
30-Year, 5.1%
The following strategies, actively managed by PFM Asset Management (PFMAM), may be structured with blend of active and passive funds (strategic blend) or passive funds only (index):

City of Twentynine Palms ▎28

MANAGED STRATEGIES
Strategy Allocation* (%)
Capital Appreciation
(65-85% Equity) 6.32%
Balanced
(50-70% Equity) 14.04%
Moderate
(40-60% Equity) 38.95%
Mod. Conservative
(20-40% Equity) 31.58%
Conservative
(5-20% Equity) 4.91%
Other
(Custom) 4.21%
TOTAL 100.00%
PRSP Strategy Allocation – Clients
Strategic Blend Platform: 54% / Passive Platform: 46%
Capital Appreciation

6.32%
Balanced

14.04%
Moderate

38.95%
Moderately
Conservative

31.58%
Conservative

4.91%
Other

4.21%
As of December 31, 2025
*Allocations are based on agencies who have funded

Disclosures Disclaimer
The views expressed within this material constitute the perspective and judgment of U.S. Bancorp Asset Management, Inc. (USBAM) at the time of distribution and are subject to change. Any forecast, projection, or prediction of the market, the economy, economic trends, and equity or fixed-income markets are based upon current opinion as of the date of issue and are also subject to change.

Opinions and data presented are not necessarily indicative of future events or expected performance. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. No representation is made as to its accuracy or completeness.

PFM Asset Management (PFMAM) serves clients in the public sector and is a division of U.S. Bancorp Asset Management, Inc. which is the legal entity providing investment advisory services. U.S. Bancorp Asset Management, Inc. is a registered investment adviser, a direct subsidiary of U.S. Bank N.A. and an indirect subsidiary of U.S. Bancorp. U.S. Bank N.A. is not responsible for and does not guarantee the products, services, or performance of U.S. Bancorp Asset Management, Inc.

Public Agency Retirement Services (“PARS”) is a third-party and not affiliated with PFMAM, USBAM or U.S. Bank. PARS serves as the trust administrator to the Public Agencies Post-Employment Benefits Trust, Public Agencies Post-Retirement Health Care Plan Trust, and the Public Agency Retirement System Trust (the “Trusts”). U.S. Bank N.A. serves as the discretionary trustee to the Trusts. In its capacity as discretionary trustee, U.S. Bank N.A. delegates the investment management of the Trusts to its affiliate USBAM through a sub-advisory agreement. PARS is serviced by PFMAM, a division of USBAM.

U.S. Bank N.A. pays the sub-adviser up to 67% of the annual management fee for assets sub-advised under its sub-advisory agreement with U.S. Bank N.A. Refer to your U.S. Bank N.A. fee schedule for investment management fees applied to your specific portfolio. U.S. Bank N.A. compensates the sub-adviser for these services from its own fees.

NOT FDIC INSURED : NO BANK GUARANTEE : MAY LOSE VALUE
For Institutional Investor or Investment Professional Use Only – This material is not for inspection by, distribution to, or quotation to the general public.
29

Additional Disclosures Disclaimer
Assets under management as of 6/30/2024 represent the assets managed by PFM asset Management LLC (PFMAM). As of 10/1/2024 PFMAM and U.S. Bancorp Asset Management, Inc. (USBAM) formerly separately registered investment advisers consolidated into one legal entity and one registered investment adviser with the SEC, with USBAM as the continuing legal entity and registered investment adviser.

NOT FDIC INSURED : NO BANK GUARANTEE : MAY LOSE VALUE
For Institutional Investor or Investment Professional Use Only – This material is not for inspection by, distribution to, or quotation to the general public.
30

STAFF REPORT
TO: City Council
FROM: City Engineer
FOR MEETING: Jun 23 2026
SUBJECT: Acceptance of Work and Notice of Completion for the 2026 Chip Seal Project.

RECOMMENDATION:

That the City Council:

1. Accept the work completed by Pavement Coating Co. as part of the above-mentioned project for a total contract cost of $308,460.28.

2. Direct the City Clerk to file the Notice of Completion for the contract work.

3. Direct the Finance Director to release the retained funds 30 days after the Notice of Completion has been filed, provided no claims are filed against the contractor.

ORDER OF PROCEDURE:

Request Staff Report (City Engineer Presenting)
Council Question of Staff
Request Public Comment
Council Discussion
Motion/Second
Discussion of Motion
Call the Question
ATTACHMENTS:
• Notice of Completion- 2026
Chip Seal Project
• Change Order No. 1- FInal

6.08.26-PCC
BACKGROUND:

On April 27, 2026, a contract for the 2026 Chip Seal Project was awarded to Pavement Coatings, Co for $296,879.05, plus a 10% contingency of $29,688. The project included the chip sealing of Condor Road from Adobe Road to the Military Gate and Utah Trail from Route 62 to Two Mile Road in Twentynine Palms, CA 92277.

The City has developed a process of various types of Asphaltic Concrete pavement preservation to extend the useful life of City streets. One of these processes is chip sealing of the existing asphaltic pavement. This revitalizes the existing pavement by installing oil back into the existing surface for flexibility and then installing an aggregate surface and fog seal to increase pavement life and rideability. The process includes crack filling, installing asphaltic liquid binder, 5/16” aggregate chip then a final liquid coating (fog seal) to seal the chip seal process followed by a restriping of the entire street. The Chip Seal Project started on June 2, 2026, and was completed on June 8, 2026.

ENVIRONMENTAL:

N/A
ALTERNATIVES: Page 67 of 146
The City Council could choose to deny the completion of work and provide other recommendations.

FISCAL IMPACT:

Funding for the project has been appropriated from local Measure I funds. A total contract amount of $296,879.05, plus a 10% construction contingency, was approved by City Council on April 27, 2026. The final project quantities as measured in the field after construction showed an increase in Item #1- Polymer Modified Chip Seal and Fog Seal in the amount of 3,747.97 SY ($11,581.23). This increase is below the amount authorized by City Council for the construction contingency of this project of 10%- ($29,688.00). Therefore, adequate funding is available for this project.

Recording Requested by:

City of Twentynine Palms
When Recorded mail to:

City of Twentynine Palms
Engineering Department
6136 Adobe Road
Twentynine Palms, CA 92277
Exempt from filing fees pursuant to
Government Code Section 27383.

SPACE ABOVE THIS LINE FOR RECORDER’S USE ONLY

NOTICE OF COMPLETION
(Public Improvement)
NOTICE IS HEREBY GIVEN, that

1. The undersigned, Richard Pedersen, is the duly appointed and qualified City Engineer of the owner of interest or estate stated below in the property hereinafter described:

2. The full name of the owner is: City of Twentynine Palms, a municipal corporation of the State of California, and which is located within the County of San Bernardino, in said State, and the address is 6136 Adobe Road, Twentynine Palms, California 92277.

3. That on the 27th day of April, 2026 and pursuant to approval of the City Council of the said City, the City entered into a contract with Pavement Coatings Co, whose address is 10240 San Sevaine Way, Jurupa Valley, CA 91752, to perform the 2026 Chip Seal Project on Condor Road and Utah Trail, in the City of Twentynine Palms, and in accordance with the City of Twentynine Palms' Plans and Specifications.

4. That all said work or improvement was located on Condor Road and Utah Trail in said City, Twentynine Palms, CA 92277.

5. That all of the said work or improvement contemplated in and under said contract was completed on June 8, 2026, and accepted by Council action on June 23, 2026.

6. That the Surety on the Performance Bond of said Contractor and the surety on the Labor and Material Bond of said Contractor, under said contract, was and is $296,879.05 and $296,879.05.

The undersigned states: That the City of Twentynine Palms, the political subdivision of the State of California conducted the proceedings for the improvement located at 6136 Adobe Road, in said City, described or referred to in the foregoing "Notice of Completion”.

I certify under penalty of perjury that the foregoing is true and correct. ____________________________________________DATE: June 23, 2026 Richard Pedersen, City Engineer,
of the City of Twenty-Nine Palms, California

STATE OF CALIFORNIA )

COUNTY OF SAN BERNARDINO )
CITY OF TWENTY-NINE PALMS )ss.

STATE OF CALIFORNIA • DEPARTMENT OF TRANSPORTATION

CHANGE ORDER
CEM-4900 (REV 06/2019)
Sheet 1 of 1
Change Requested By: X Engineer X Contractor
CHANGE ORDER NO.
1- Final
SUPPL. NUMBER CONTRACT NUMBER CO-RTE-PM FEDERAL NUMBER(S) 2026 Chip Seal Project
TO: Pavement Coastings Co., contractor
You are directed to make the following changes from the plans and specifications or do the following described work not included in the plans and specifications for this contract. NOTE: This change order is not effective until approved by the engineer.

Pavement Coatings Co.

Bid Unit Contract Contract To Date To Date
Amount of
Increase
Amount
of
Item Item Description Price Unit Quantity Amount Quantity Amount Decrease 1 Polymer Modified Chip
Seal Medium Fine w/
Fog Seal Application
$3.09 SY 61,045 $188,629.05 $64,792.97 $200,210.28 $11,581.23 $0.00 2 Remove Existing
Traffic Striping and
Pavement Markings &
RPM's
$28,000.00 LS 1 $28,000.00 1.00 $28,000.00 $0.00 $0.00
3 Install Thermoplastic
Striping and Pavement
Markings & RPM's $45,000.00 LS 1 $45,000.00 1.00 $45,000.00 $0.00 $0.00 4 Traffic Control & Public
Notification $35,250.00 LS 1 $35,250.00 1.00 $35,250.00 $0.00 $0.00 Subtotal $296,879.05 $308,460.28 $11,581.23 $0.00
Estimated Cost: Increase X Decrease $11,581.23

SUBMITTED BY

SIGNATURE
Charles D Collett
(PRINT NAME AND TITLE)
Charles D Collett, Senior Public Works Inspector / Project Manger
DATE
6/8/26

APPROVAL RECOMMENDED BY

SIGNATURE (PRINT NAME AND
TITLE) City Manager
DATE

ENGINEER APPROVAL BY

SIGNATURE (PRINT NAME AND TITLE)
Richard Pedersen, City Engineer
DATE
6/8/26
We, the undersigned contractor, have given careful consideration to the change proposed and agree to provide equipment, furnish materials, and perform the work specified above, and will accept as full payment the prices shown above. NOTE: If you do not sign this order, you are directed to proceed with the ordered work. You may file a Request for Information within the time specified.

CONTRACTOR ACCEPTANCE BY

SIGNATURE (PRINT NAME AND TITLE
Pavement Coatings Co.

DATE
ADA Notice This document is available in alternative accessible formats. For more information, please contact the Forms Management Unit at (279) 234-2284, TTY 711, in writing at Forms Management Unit, 1120 N Street, MS-89, Sacramento, CA 95814, or by email at [email protected].

Description of work to be done, estimate of quantities, and prices to be paid. (Segregate between additional work at contract price, agreed price, and force account). Unless otherwise stated, rates for rental of equipment cover only such time as equipment is actually used and no allowance will be made for idle time. The last percentage shown is the net accumulated increase or decrease from the original quantity in the Bid Item List. 6/8/26

STAFF REPORT
TO: City Council
FROM: City Clerk
FOR MEETING: Jun 23 2026
SUBJECT: Adoption of an Election Resolution Calling and Giving Notice of a General Municipal Election.

RECOMMENDATION:

The City Council adopt Resolution No. 26-___, a Resolution calling and giving notice of a General Municipal Election on November 3, 2026, for the election of certain officers for Districts 3, 4, and 5 and requesting consolidation of the Municipal Election with the Statewide General Election.

ORDER OF PROCEDURE:

Request Staff Report (City Clerk Presenting)
Council Question of Staff
Request Public Comment
Council Discussion
Motion/Second
Discussion of Motion
Call the Question
ATTACHMENTS:
• Election Reso 26-____Calling
the Election
BACKGROUND:

The City of Twentynine Palms (City) has a General Municipal Election scheduled for November 3, 2026. Three Councilmember seats will become vacant for full four-year terms. The terms of Mayor Daniel Mintz, Mayor Pro Tem Octavious Scott and Councilmember McArthur Wright will expire in November 2026; however, these Councilmembers are eligible to file for reelection within their Districts.

With the adoption of Ordinance No. 284, By-District Elections were established for City Councilmembers for the November 3, 2026 Election; the three (3) seats up for election are for Districts 3, 4, and 5.

The City contracts with the County of San Bernardino Registrar of Voters for election services and it is required that the City request consolidation of the Municipal Election with the Statewide General Election. Resolution No. 26-___ accomplishes the above-mentioned items necessary to proceed with the City's General Municipal Election.

ENVIRONMENTAL:

N/A
ALTERNATIVES:

None.

FISCAL IMPACT:

Unknown at this time.

CITY OF TWENTYNINE PALMS

CITY COUNCIL
RESOLUTION NO. 26-___

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF TWENTYNINE

PALMS, CALIFORNIA, CALLING AND GIVING NOTICE OF A GENERAL MUNICIPAL ELECTION TO BE HELD ON TUESDAY, NOVEMBER 3, 2026 FOR THE ELECTION OF CERTAIN OFFICERS IN DISTRICT 3, DISTRICT 4 AND DISTRICT 5 AS REQUIRED BY THE PROVISIONS OF THE LAWS OF

THE STATE OF CALIFORNIA RELATING TO GENERAL LAW CITIES, AND

REQUESTING THE COUNTY BOARD OF SUPERVISORS TO CONSOLIDATE

THIS ELECTION WITH THE STATEWIDE ELECTION TO BE HELD ON SAID DATE.

WHEREAS, under the provisions of the laws relating to General Law Cities in the State of California, and as implemented by Ordinance No. 284 of the City Council of the City of Twentynine Palms, a General Municipal Election shall be held on November 3, 2026, for the election of Municipal Officers in District 3, District 4, and District 5; and

NOW THEREFORE, THE CITY COUNCIL OF THE CITY OF TWENTYNINE PALMS, CALIFORNIA, DOES RESOLVE, DECLARE, DETERMINE, AND ORDER AS FOLLOWS:

Section1. That pursuant to the requirements of the laws of the State of California relating to General Law Cities, there is called and ordered to be held in the City of Twentynine Palms, California, on Tuesday, November 3, 2026, a General Municipal Election for the purpose of electing two Members of the City Council for the full term of four years in District 3, District 4 and District 5.

Section 2. That the ballots to be used at the election shall be in form and content as required by law.

Section 3. That the City Council requests that the Board of Supervisors of San Bernardino County consolidate the election with the statewide election to be held on November 3, 2026, and further requests that the County of San Bernardino Registrar of Voters provide election services necessary at a fee to be paid by the City.

Section 4. That the San Bernardino County Registrar of Voters is authorized, instructed and directed to procure and furnish any and all official ballots, notices printed matter, supplies, equipment and paraphernalia that may be necessary in order to properly and lawfully conduct the election.

Section 5. That the polls for election shall open at seven o’clock (7:00) a.m. the day of the election and shall remain open continuously from that time until eight o’clock (8:00) p.m. of the same day when the polls shall be closed, except as provided in Section 14401 of the Election Code of the State of California.

Section 6. That in all particulars not recited in this Resolution, the election shall be held and conducted as provided by law for holding municipal elections.

Section 7. That notice of the time and place of holding the election will be given pursuant to Section 12101 of the Elections Code, and the San Bernardino County Registrar of

Voters is authorized, instructed, and directed to give further or additional notice of the election in time, form and manner as required by law.

Section 8. That the City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original Resolutions.

PASSED, APPROVED, AND ADOPTED on the 23rd day of June 2026. ____________________________
Daniel L. Mintz, Mayor

ATTEST:
________________________________
Cynthia Villescas, CMC
City Clerk
I, Cynthia Villescas, City Clerk of the City of Twentynine Palms, do hereby certify that Resolution No. 26-___ was adopted by the City Council of the City of Twentynine Palms at a regular meeting held on the 23rd day of June 2026, by the following vote to wit:

AYES: COUNCILMEMBER:

NOES: COUNCILMEMBER:

ABSENT: COUNCILMEMBER:

ABSTAIN: COUNCILMEMBER:
________________________________
Cynthia Villescas, CMC
City Clerk

STAFF REPORT
TO: City Council
FROM: City Manager
FOR MEETING: Jun 23 2026
SUBJECT: Information on the Importance of Periodic Septic System Maintenance.

RECOMMENDATION:

The purpose of this agenda item is to make the public aware of the vital need to periodically inspect and maintain your septic system. Proper maintenance will help protect the City's water supply and may help residents avoid expensive repairs. The EPA recommends having a professional inspect your system at least every three years and pump out the system every three to five years. Do your part to protect our water supply! ORDER OF PROCEDURE:

Request Staff Report (City Manager Presenting)
Council Question of Staff
Request Public Comment
Council Discussion
Motion/Second
Discussion of Motion
Call the Question
ATTACHMENTS:
• 2025-11-05 SEPTIC
SYSTEMS TPWD_KM (1) (1)
• 2025-11-05 FOG FREE_KM
(1) (1)
BACKGROUND:

The City of Twentynine Palms (City) and Twentynine Palms Water District (District) are collaborating their efforts to address the potential impacts to the shallow groundwater aquifers from septic systems within city limits.

For several years, the City and District have been completing tasks outlined in the Salt and Nutrient Management Plan (SNMP), collaboratively prepared, as required by the Colorado River Basin Regional Water Quality Control Board (Water Board). The plan was prepared in 2014 and later approved in 2019. Through this plan, they are undertaking measures to increase monitoring of the groundwater and to limit potential water quality impacts to groundwater that may arise from the septic systems in the region.

Residents of the City and the unincorporated areas rely solely on groundwater for their daily needs. This community pulls from four different underground basins (aquifers) that also overlap with neighboring districts. With no centralized sewer throughout the community, commercial and residential lots rely on septic systems to hold the domestic wastewater from their properties.

The District provides drinking water to their customers from deeper groundwater aquifers (>300 feet below ground surface). It is the District’s understanding that there is a clay layer separating the shallow groundwater from the deep groundwater. However, water naturally flows through paths of least resistance, so the potential for shallow groundwater to make its way down to the deeper groundwater remains present.

One of the main potential impacts to groundwater is septic systems. Within the City, there are individual systems for residential housing, and there are package systems (batch treatment) for residential developments, hotels and commercial areas.

With septic systems come different responsibilities. Due to systems holding domestic wastewater underground, they can pose a severe risk to our groundwater if they are not properly maintained. If installed, managed, and maintained as intended, septic systems are considered an acceptable solution to domestic wastewater treatment for rural areas. When septic systems are not regularly inspected and maintained, the results for potential water quality can impact the shallow groundwater.

There are eight (8) batch treatment systems in the City. The City and the Water District are aware of three systems that are failing. These systems are permitted by the Water Board. The other septic systems are individual residential systems that are permitted separately. Failing batch treatment plants may also affect water quality in the shallow groundwater.

The Water Board upholds that all water shall be protected, regardless of whether or not it is used for drinking, recreation or natural habitat. There is a need to better understand the quality of the shallow groundwater beneath the City. As part of the SNMP, measures have been identified to obtain information, communicate with residents and business owners, and implement ways to protect, or minimize the potential for further degradation of the shallow groundwater aquifers beneath the City.

The easiest and most immediate way to support these measures is to establish continual communications with the City Council, residents, and business owners. Communications can be used to provide education about septic systems and reminders about proper inspections and maintenance. These communications have just now begun with the addition of this memo and corresponding presentation by Matt Shragge with the District to City Council meetings. The City will have an item on the Consent Calendar each meeting to keep the City Council updated on this topic. The following are additional communication options to consider:

1. Add information to the City Website:
a. Community Events page:
i. Weekly Certified Farmers Market
b. Community Development Department Page
i. We could add a link called “Septic Systems” in it where we can add information. c. City Public Works website

2. Add information to the City Newsletter (info tidbits about septic systems and maybe information about timely inspections of septic systems).

3. Annual Pioneer Days – could be an opportunity to share how wastewater is managed

4. Community Health & Resource Fair
The District will also be looking into ways to spread the word about septic systems such as:

1. District Website:
a. Front Page - Hot Topics section (inclusion of tidbits about septic systems) b. Water Quality page – “Protecting Your Water”
c. Providing links to existing SNMP and other groundwater related reports d. Septic Tank Maintenance Section

2. District Quarterly Newsletter
These are options to consider and do not need to be implemented at once, but little by little as deemed appropriate. The intent is to keep residents informed of the City’s activities with respect to water quality, so that a foundation is established, conversations can begin, and improvements made as they are identified.

The Water Board has been engaged in discussions with the City and the District. Progress on septic system management is expected and accomplishments are reported on annually. Progress has now begun with the inclusion of this memo and the District’s presentation to this City Council Meeting.

ENVIRONMENTAL:

N/A
ALTERNATIVES:

N/A
FISCAL IMPACT:

N/A

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STAFF REPORT
TO: City Council
FROM: City Clerk
FOR MEETING: Jun 23 2026
SUBJECT: Senate Bill 707 (SB707)Introduction of Policies Related to Brown Act Changes.

RECOMMENDATION:

The City Council:
1). Receive and file information on SB707; and
2). Review, discuss and provide recommendations to Staff on the new policies. Draft policies will be distributed prior to the City Council meeting.

ORDER OF PROCEDURE:

Request Staff Report (City Clerk Presenting)
Council Question of Staff
Request Public Comment
Council Discussion
Motion/Second
Discussion of Motion
Call the Question
BACKGROUND:

On October 3, 2025, Governor Newsom signed Senate Bill 707 (SB707) into law. The intent of this bill is to increase public engagement in local government and modernize the Ralph M. Brown Act. Some SB707 provisions went into effect on January 1, 2026, however the most significant changes will become effective on July 1, 2026.

Beginning July 1, 2026, under SB 707, “eligible legislative bodies,” including the Twentynine Palms City Council, must comply with new public meeting requirements. Staff will address these requirements through the following actions:
 Allow remote participation via video
o Implement a web conferencing platform for Council Chamber technology upgrades  Adopt a Public Participation policy outlining steps if remote access fails  Provide a public space to post translated agendas near official postings Additional changes include:

Non-traditional teleconferencing expanded: Extends the pandemic-era teleconference rules though January 1, 2030, and allows Council Members to participate remotely without posting their location publicly when qualifying under “just cause”. “Just cause” has been expanded to include childcare responsibilities, illness, family emergencies, work related travel or military service obligations. Council Members may participate remotely up to 5 meetings per year once the web conferencing platform is implemented. Page 83 of 146 ADA remote participation: Council Members with disabilities may participate remotely as a reasonable accommodation, using audio/video (or audio-only if necessary), and must disclose any adults present. They count toward quorum, and standard teleconferencing rules do not apply.

Social media restrictions extended: AB 992’s limits on members discussing official business on social media (including posts, comments, or emojis) are now permanent and no longer expire in 2026.

Staff has prepared a City Council Meeting Public Participation Policy, to establish procedures for public participation in person, telephonically, and via the web conferencing platform. The policy language can be summarized to provide clear instructions on meeting agendas and on the City’s website, helping to encourage effective public participation.

ENVIRONMENTAL:

N/A
ALTERNATIVES:

As determined by the City Council.

FISCAL IMPACT:

The City will incur $21,483.92 in order to upgrade the Council Chambers to comply with SB707.

STAFF REPORT
TO: City Council
FROM: Finance Director
FOR MEETING: Jun 23 2026
SUBJECT: Proposed Budget Revisions for Special Revenue Funds, Capital Projects Funds, and Successor Agency Fund for Fiscal Year 2026-27.

RECOMMENDATION:

The City Council approve the following:

1. Resolution No. 26-__, adopting the budget revisions for the Special Revenue Funds (excluding Project Phoenix Funds), Capital Projects Funds, and Successor Agency Fund for FY 2026-27.

2. Interfund transfers for FY 2026-27 as follows:
 $10,000 from the Gas Tax Fund to the General Fund for Admin fees.  $20,000 from the Measure I Fund to the General Fund for Admin fees.  $27,040 from the Successor Agency Fund to the General Fund for Admin fees.

3. Changes to the FY 2025-26 budget for the following funds:
 Amendments to the General Capital Projects Fund
 Establishment and adoption of the new Elm Avenue Project Fund and related budget.

ORDER OF PROCEDURE:

Request Staff Report (Finance Director presenting)
Council Question of Staff
Open the Public Hearing
Request Public Comment
Close the Public Hearing
Council Discussion
Motion/Second
Discussion of Motion
Call the Question
ATTACHMENTS:
• Resolution No. 26__ Special
Revenue Funds FY 2026-27
• Attachment A - Special
Revenue Funds Budget
Revisions FY 2026-27
• FY 2026-27 Proposed Budget
Revisions Special Funds -
Presentation
BACKGROUND:

The Finance Director is presenting the proposed budget revisions for the Capital Projects Funds, Special Revenue Funds and Successor Agency Fund, a Private-Purpose Trust Fund, for FY 2026-27. The original budgets were adopted on June 10, 2025. The City has the following fund structure:

Government:
 One (1) General Fund. The City's chief operating fund.  Ten (10) Special Revenue Funds. These funds are established by the City Council or other agencies to collect money that must be used for a specific project or purpose. These funds provide an extra level of accountability and transparency to taxpayers and/or ratepayers that their tax or fee dollars will go towards an intended purpose.
 Five (5) Capital Projects Funds. These funds account for the financial resources used for the acquisition or construction of major capital facilities and other capital related projects (other than those financed in the proprietary fund types).

Proprietary:

These funds are used by government entities to account for activities that are similar to business-type activities.

These funds are used when a government provides services to the public or other government agencies on a cost-reimbursement basis. Proprietary Funds are categorized into two main types: Enterprise Funds and Internal Service Funds. The City has one (1) Enterprise fund.

Fiduciary:

These funds account for resources that are held in a trustee or agency capacity for others and cannot be used to support the government’s own programs. Fiduciary funds are categorized into four types: Pension (and Other Employee Benefit) Trust Funds, Investment Trust Funds, Private-Purpose Trust Funds, and Custodial Funds. The City has one Private-Purpose Trust fund.

The budget revisions to the General Fund were approved on May 23, 2026. The Enterprise Fund and any activity from the Project Phoenix project will be presented separately to avoid a perceived conflict of interest.

The total revenue and transfers in from the Special Revenue Funds and Capital Projects Fund combined is $11.4M, and total use of reserves is $2.9M. The revenue from the Special Revenue Funds and Capital Projects Fund are mainly derived from tax revenue sources and grants. In total, the City is projecting to receive approximately $2.2M in tax revenue from the following sources: $800K from the Road Maintenance Rehab Account (RMRA) funding, $829K from the Highway Users Tax Account accounted for in the Gas Tax Fund, and $533K from Measure I funds derived from a one-half (1/2) percent Transactions and Use Tax originally approved by San Bernardino County voters in 1989 and renewed in 2004. As presented to City Council on April 14, 2026, the San Bernardino County Transportation Authority (SBCTA) is proposing a continuation of Measure I beyond 2040, which is anticipated to be placed before voters on the November 3, 2026 ballot. If approved by voters, the continuation would maintain the existing one-half of one percent sales tax rate without increasing taxes and is estimated to generate approximately $7.5 billion over its first 30 years. Revenues would remain within San Bernardino County and would continue to be dedicated exclusively to transportation-related purposes.

The total expenditures and transfers out in the Special Revenue Funds and Capital Projects Funds combined is $14.2M; $13.3M of this total will be for major capital improvements, street maintenance projects, and other capital related projects. The table below shows a summary of the projected costs for these projects in FY 2026-27:

Project Type Amount
Streets $2,791,314
Parks $868,746
Safety $8,287,435
Other Projects $1,368,989
Total $13,316,484
As mentioned above, the City has a Private-Purpose Trust Fund which accounts for the activities of the Successor Agency to the Twentynine Palms Redevelopment Agency. There were no budget revisions for this fund. For a detail list of budget revisions and funds description, please refer to the attached budget and presentation. Page 86 of 146
In addition to the proposed budget revisions for FY 2026-27, City Staff is recommending the approval of the budget amendments in the General Capital Projects fund for FY 2025-26 and establishment and adoption of the new Elm Avenue Project Fund and related budget for FY 2025-26 (see green highlighted cells in attached budget). The facts surrounding the proposed changes were not known at the time the mid-year budget was presented to City Council back in February of this year.

Current Funding Challenges:

With the continued high inflation rates, the cost of labor, materials and services has gone up significantly; this can potentially leave various projects underfunded. Staff will request additional funding for unfunded projects as needed.

ENVIRONMENTAL:

N/A
ALTERNATIVES:

The City Council could reject, add, or reduce any of Staff’s spending recommendations.

FISCAL IMPACT:

A balanced budget.

CITY OF TWENTYNINE PALMS

CITY COUNCIL
RESOLUTION NO. 26- ____

A RESOLUTION OF THE CITY COUNCIL O F THE CITY OF TWENTYNINE

PALMS, CALIFORNIA, ADOPTING THE B U D G E T R E V I S I O N S O F T H E CITY’S SPECIAL REVENUE FUNDS, CAPITAL PROJECTS FUNDS, AND SUCCESSOR AGENCY FUND FOR FISCAL YEAR 2026/2027
WHEREAS, the City Council is adopting a budget before the beginning of Fiscal Year July 1, 2026; and
WHEREAS, the City Council has reviewed the budget and accepted public input.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Twentynine Palms, California, adopts the budget revisions, attached as Exhibit “A” and incorporated by reference to this Resolution, for the Fiscal Year ending June 30, 2027 as follows:

1. The adopted budget for the Special Revenue Funds and Capital Projects Funds for Fiscal Year 2026/2027 is $14,153,217;

2. The City Council/Successor Agency Board of Directors have determined that the Fiscal Year 2026/2027 budget of $893,835 complies with the dissolution laws;

3. The legal level of budgetary control is at the fund level. The City Manager is authorized to transfer appropriations between accounts within each fund as long as the total adopted budget allocation of that fund is not exceeded.

4. Transfers from fund to fund will require approval of the City Council, if not approved in the budget.

4. This Resolution shall be effective July 1, 2026.

PASSED, APPROVED, AND ADOPTED on the 23rd day of June 2026.

Daniel L. Mintz, Sr., Mayor
ATTEST:

Cindy Villescas, CMC
City Clerk
I, do hereby certify that the foregoing Resolution No. 26-___, was duly adopted by the City Council of the City of Twentynine Palms at a regular meeting thereof held on 23rd day of June, 2026, by the following vote:

AYES: COUNCILMEMBER:

NOES: COUNCILMEMBER:

ABSENT: COUNCILMEMBER: Page 88 of 146
ABSTAIN: COUNCILMEMBER:

_________________________________
Cindy Villescas, CMC
City Clerk

CITY OF TWENTYNINE PALMS

CAPITAL PROJECTS FUNDS, AND

SPECIAL REVENUE FUNDS

SUCCESSOR AGENCY FUND

REVISED BUDGETS
FISCAL YEAR 2026-27

APPROVED
2/24/26

APPROVED
6/10/25
2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 10-0000 REVENUE
4316 Transfer In $ 399,298 $ 653,040 $ 133,334 $ 433,300 $ 181,000 $ 282,000 $ 101,000 4321 LEAP Grant $ 38,585 $ - $ - $ - $ - $ - $ -
4328 Caltrans/HBP - Split Rock $ 76,207 $ - $ - $ - $ - $ - $ - 4717 Trails and Greenway Prop 68 $ 21,964 $ - $ - $ - $ - $ - $ - 4728 SBCTA/SCAG - Sullivan Bike Path $ - $ 53,777 $ 88,200 $ 3,480,000 $ 3,480,000 $ 3,480,000 $ - 4890 Other/Miscellaneous Revenue $ - $ - $ 65,000 $ - $ 60,000 $ 60,000 Reserves $ 569,186 $ 1,277,272 $ 337,411 $ 1,814,252 $ 1,226,507 $ 1,547,045 $ 320,538 TOTAL REVENUE $ 1,105,240 $ 1,984,089 $ 558,945 $ 5,792,552 $ 4,887,507 $ 5,369,045 $ 481,538 10-DEPT EXPENDITURES
6295 Well Repair** $ 24,686 $ 22,284 $ 28,231 $ 50,000 $ 50,000 $ 50,000 $ - 6335 Trails Flood Control Plan Prop 68 $ 24,557 $ 4,500 $ - $ - $ - $ - $ - 6351 General Plan/Housing Element Update $ 5,329 $ - $ - $ - $ - $ - $ - 6351 General Plan/Social Equity Element $ 7,853 $ - $ - $ - $ - $ - $ - 6359 Contract & Consulting - Sales Tax Measure $ - $ - $ 93,820 $ 125,300 $ - $ 31,032 $ 31,032 6510 Safety & Security - City Hall $ - $ - $ 16,248 $ 15,000 $ - $ 10,000 $ 10,000 6510 Safety & Security - Community Development $ - $ - $ - $ 25,000 $ - $ 25,000 $ 25,000 6512 Re Roof City Buildings $ - $ - $ - $ 100,000 $ 80,000 $ 225,750 $ 145,750 6520 Vehicle Replacement - Code Enforcement $ - $ 51,150 $ - $ - $ - $ - $ - 6520 Vehicle Replacement - Animal Control $ - $ - $ 136,001 $ 136,000 $ - $ - $ - 6520 Vehicle Replacement $ - $ 3,294 $ - $ - $ - $ 15,000 $ 15,000 6692 Building Improvement - CD/Finance $ 59,177 $ - $ - $ - $ - $ - $ - 6692 Building Improvement - Senior Center $ - $ - $ 3,981 $ 200,000 $ - $ 196,019 $ 196,019 6694 Animal Control Building $ - $ - $ - $ 178,394 $ - $ 178,394 $ 178,394 6695 Animal Control - New Shelter $ 33,474 $ 120,195 $ 7,505 $ 596,331 $ 602,980 $ 588,826 $ (14,154) 6770 Luckie Park Renovations $ - $ - $ 34,240 $ 40,000 $ - $ 40,000 $ 40,000 6779 Hatch/Sullivan Bike Path $ 6,473 $ 63,441 $ 188,062 $ 3,985,527 $ 3,970,527 $ 3,744,024 $ (226,503) 6781 Split Rock Bridge Design + CM $ 86,080 $ - $ - $ - $ - $ - $ - 6803 MBTA Project Phoenix Transfer Station $ 7,591 $ 6,542 $ 5,843 $ 8,000 $ 8,000 $ 8,000 $ - 6823 Electronic Equipment $ - $ - $ - $ 35,000 $ - $ 35,000 $ 35,000 6852 Shade Structures - City Hall $ - $ - $ - $ 45,000 $ 45,000 $ 45,000 $ - 6853 Playground Equipment $ - $ - $ 50,000 $ - $ 50,000 $ 50,000 6866 Homekey Project $ - $ - $ 58,339 $ 68,000 $ - $ - $ - 6897 Replace Luckie Park Light Poles $ 438,554 $ 1,039,300 $ - $ - $ - $ - $ - 6985 Equipment Replacement Fund $ - $ - $ - $ 25,000 $ 21,000 $ 17,000 $ (4,000) 6988 Luckie Park Pool Upgrade $ 11,451 $ - $ - $ - $ - $ - $ - TOTAL EXPENDITURES $ 705,225 $ 1,310,706 $ 572,270 $ 5,682,552 $ 4,777,507 $ 5,259,045 $ 481,538

GENERAL CAPITAL PROJECTS FUND
The Capital Improvement Fund tracks grants and projects that aren't related to Community Development Block Grants. 1

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 11-0000 REVENUE
4316 Transfer In $ - $ 6,000 $ - $ - $ - $ - $ -
4400 Community Development
Block Grant $ 74,500 $ - $ - $ 108,239 $ 150,000 $ 300,897 $ 150,897 4400 CDBG - Homekey Program $ - $ 85,612 $ 237,508 $ 145,421 $ - $ - $ - 4410 Meal Assistance Program $ 37,462 $ - $ - $ - $ - $ - $ - TOTAL REVENUE $ 111,962 $ 91,612 $ 237,508 $ 253,660 $ 150,000 $ 300,897 $ 150,897 11-XXXX EXPENDITURES
6866 Homekey Project $ 14,000 $ 48,628 $ 145,421 $ 145,421 $ - $ - $ - 6905 COVID-19 Meal Assistance Program $ 37,462 $ - $ - $ - $ - $ - $ - 6770 Luckie Park Basketball Court, Tennis Courts,
and Ball Courts Resurfacing $ 74,500 $ - $ - $ - $ - $ - $ - 6770 Luckie Park Parking Lot ADA Improvements $ - $ 28,984 $ 96,934 $ 108,239 $ 150,000 $ - $ (150,000) 6770 Luckie Park Pedestrian Pathways $ - $ - $ - $ - $ - $ 144,849 $ 144,849 6770 Luckie Park Activity Center Parking Lot Improvements $ - $ - $ - $ - $ - $ 156,048 $ 156,048 6771 Luckie Park Reconstruction $ 77 $ - $ - $ - $ - $ - $ - TOTAL EXPENDITURES $ 126,039 $ 77,612 $ 242,355 $ 253,660 $ 150,000 $ 300,897 $ 150,897

COMMUNITY DEVELOPMENT BLOCK GRANT FUND
Community Development Block Grants (CDBG) are funded by the Federal Government and administered by the County. In order to benefit as many citizens as possible, the funds are used for parks and public buildings.
2

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 12-0000 REVENUE
4245 Interest $ 42,141 $ 31,950 $ 9,635 $ 5,000 $ - $ 8,000 $ 8,000 4264 Curb, Gutter & Sidewalk Impact
Fees $ 34,711 $ - $ - $ - $ - $ - $ -
Reserves $ 94,199 $ 480,799 $ - $ 246,000 $ - $ 82,000 $ 82,000 TOTAL REVENUE $ 171,051 $ 512,749 $ 9,635 $ 251,000 $ - $ 90,000 $ 90,000 12-4043 EXPENDITURES
6655 Street Widening Desing - Cholla Ave $ 9,115 $ 493,226 $ - $ 250,000 $ - $ - $ - 6??? Curbs, Gutter & Sidewalks - 5152 Adobe $ - $ - $ - $ - $ - $ 90,000 $ 90,000 6922 Safe Route 2 School Eng/Adm $ 161,936 $ 19,523 $ 620 $ 1,000 $ - $ - $ - TOTAL EXPENDITURES $ 171,051 $ 512,749 $ 620 $ 251,000 $ - $ 90,000 $ 90,000

CURB, GUTTER & SIDEWALK IMPACT FEE FUND
This Fund was created to track the collection and use of impact fees collected when building permits are issued. The purpose is to provide off-site improvements . 3

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 15-0000 REVENUE
4245 Interest $ - $ 2,468 $ 7,109 $ 5,000 $ 2,500 $ 6,000 $ 3,500 4267 Development Impact Fees - Streets $ - $ 126,217 $ 152,350 $ 150,000 $ 92,500 $ 144,000 $ 51,500 TOTAL REVENUE $ - $ 128,685 $ 159,459 $ 155,000 $ 95,000 $ 150,000 $ 55,000 15-4043 EXPENDITURES
6534 Street Improvements $ - $ - $ - $ 155,000 $ 95,000 $ 150,000 $ 55,000 TOTAL EXPENDITURES $ - $ - $ - $ 155,000 $ 95,000 $ 150,000 $ 55,000

DEVELOPMENT IMPACT FEE - TRANSPORTATION FUND
This Fund was created to track the collection and use of development impact fees collected when building permits are issued for development projects. The fee is charged in relation to the square footage of the proposed structure. The purpose of this fee is to ensure that new development funds the share of transportation facility costs associated with growth.
4

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 16-0000 REVENUE
4245 Interest $ - $ - $ - $ 1,000 $ 1,000
4272 Rental Fees $ 4,148 $ 4,438 $ - $ 30,936 $ 30,936
TOTAL REVENUE $ 4,148 $ 4,438 $ - $ 31,936 $ 31,936
16-1015 EXPENDITURES
5110 Salaries $ - $ - $ - $ 3,758 $ 3,758
5235 Vehicle/Cell Allowance $ - $ - $ - $ 8 $ 8
5250 Insurance $ - $ - $ - $ 419 $ 419
5251 Retirement $ - $ - $ - $ 298 $ 298
5252 Workers Comp $ - $ - $ - $ 150 $ 150
6210 Electricity $ 122 $ 350 $ - $ 2,000 $ 2,000
6211 Natural and Propane Gas $ - $ 100 $ - $ 250 $ 250
6212 Water $ 179 $ 252 $ - $ 1,500 $ 1,500
6213 Trash $ 176 $ 348 $ - $ 1,800 $ 1,800
6290 Grounds Operation & Maint. $ - $ - $ - $ 2,500 $ 2,500 6291 Building Operation & Maint. $ - $ - $ - $ 2,500 $ 2,500 6312 Small Equipment & Tools $ - $ - $ - $ 500 $ 500
6508 Capital Equipment $ - $ - $ - $ 3,000 $ 3,000
TOTAL EXPENDITURES $ 477 $ 1,050 $ - $ 18,683 $ 18,683
This Fund was created to account for the activities associated with the Elm Avenue Project. On December 22, 2021, the City acquired four residential units on a single lot with the objective of providing affordable housing for homeless veterans. The acquisition was funded by the Department of Housing and Community Development (HCD) under the Community Development Block Grant - Coronavirus (CDBG-CV) Homekey Set-Aside program.

The four residential units, collectively known as the Elm Avenue Property, are located at 6937, 6939, 6941, and 6943 Elm Avenue in Twentynine Palms. The four units are restricted as affordable housing for a period of fifty-five (55) years commencing on February 26, 2026. The four units are covered by a Housing Assistant Payment (HAP) contract between the City and the Housing Authority of the County of San Bernardino. All the contract units are designated for occupancy by individuals or families eligible for supportive services under the Veterans Affairs Supportive Housing (VASH) program.

ELM AVENUE PROJECT FUND
5

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 21-0000 REVENUE
4245 Interest $ 9,279 $ 8,645 $ 12,280 $ 5,000 $ 5,000 $ - $ (5,000) 4432 RMRA SB1 $ 679,370 $ 771,654 $ 582,362 $ 748,372 $ 792,641 $ 795,609 $ 2,968 Reserves $ - $ - $ - $ 34,128 $ - $ - $ -
TOTAL REVENUE $ 688,649 $ 780,299 $ 594,642 $ 787,500 $ 797,641 $ 795,609 $ (2,032) 21-4043 EXPENDITURES
6508 Capital Equipment
6772 Overlay by Street Crew/Chip Seal $ 679,729 $ 674,187 $ 782,590 $ 787,500 $ 797,641 $ 795,609 $ (2,032) TOTAL EXPENDITURES $ 679,729 $ 674,187 $ 782,590 $ 787,500 $ 797,641 $ 795,609 $ (2,032) ROAD MAINTENANCE REHAB ACCOUNT (RMRA) SB1 FUND
RMRA Funds are derived from a per gallon fuel excise tax, diesel fuel sales tax and vehicle registration fee. These funds are used on roads for major work rather than day to day repairs.
6

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 22-0000 REVENUE
4245 Interest $ 9,833 $ 7,826 $ 6,179 $ 5,000 $ 5,000 $ 5,000 $ - 4432 2032 Gov's Add'l Funds $ - $ - $ - $ - $ - $ - $ - 4439 2103 Funds $ 239,478 $ 270,173 $ 218,539 $ 270,986 $ 266,141 $ 279,902 $ 13,761 4440 2106 Funds $ 104,332 $ 114,985 $ 92,776 $ 114,855 $ 116,006 $ 115,944 $ (62) 4441 2107 Funds $ 216,175 $ 233,086 $ 186,654 $ 242,829 $ 250,441 $ 244,514 $ (5,927) 4442 2107.5 Funds $ 6,000 $ 6,000 $ 6,000 $ 6,000 $ 6,000 $ 6,000 $ - 4443 2105 Funds $ 159,706 $ 175,712 $ 141,643 $ 181,690 $ 183,685 $ 182,945 $ (740) Reserves $ 56,930 $ - $ - $ 44,824 $ - $ - $ -
TOTAL REVENUE $ 792,454 $ 807,782 $ 651,791 $ 866,184 $ 827,273 $ 834,305 $ 7,032 22-4043 EXPENDITURES
5110 Salaries $ 371,212 $ 312,575 $ 313,640 339,259 326,223 324,778 (14,481) $ 5235 Vehicle/Cell Allowance $ 659 $ 480 $ 478 780 780 450 (330) $ 5250 Insurance $ 58,013 $ 45,014 $ 42,163 52,546 52,460 53,217 671 $ 5251 Retirement $ 39,786 $ 33,691 $ 34,270 37,121 35,619 36,312 (809) $ 5252 Workers Comp $ 10,717 $ 13,204 $ 10,984 13,570 13,049 12,991 (579) $ 5253 PTO $ 11,422 $ 14,312 $ 4,938 13,000 12,000 13,000 - $ 6210 Electricity $ 9,988 $ 6,276 $ 6,124 12,000 9,500 12,000 - $ 6211 Natural Gas $ 196 $ 306 $ 175 650 500 650 - $
6212 Water $ 362 $ 404 $ 436 600 600 600 - $
6221 Telephone $ 302 $ 515 $ 585 500 500 500 - $
6241 Office Supplies $ 40 $ - $ - 800 500 800 - $
6251 Training & Meetings $ - $ - $ - 500 500 500 - $
6262 Equipment Repair &
Maintenance $ 49,287 $ 52,338 $ 71,804 65,000 65,000 69,262 4,262 $ 6272 Vehicle Repair &
Maintenance $ 22,563 $ 69,571 $ 35,943 53,341 40,000 58,000 4,659 $ 6291 Building Repair &
Maintenance $ 3,513 $ 2,604 $ 5,022 4,000 5,000 5,000 1,000 $ 6312 Small Equip. & Tools $ 5,073 $ 2,454 $ 939 5,000 5,000 5,000 - $ 6327 Equipment Lease $ - $ 1,009 $ (1,009) - - - - $
6332 Uniforms $ 3,427 $ 2,923 $ 3,455 4,000 4,000 4,000 - $ 6359 Contract Services $ - $ - $ 14,553 - 14,553 5,497 5,497 $ 6432 Liability and Property
Insurance $ 44,228 $ 51,915 $ 57,728 74,880 62,400 64,134 (10,746) $ 6508 Capital Equipment $ - $ - $ 63,685 - 70,000 - - $
6532 Signs & Striping $ 3,702 $ 5,966 $ 7,209 7,000 7,000 7,500 500 $ 6534 Road Improvement
& Maintenance $ 211 $ 47 $ 3,228 5,000 5,000 5,000 - $
6536 Asphalt & Concrete $ 9,713 $ 6,754 $ 414 11,000 8,000 11,000 - $ 6537 Emergency Road Work $ 59 $ 2,008 $ 12,815 5,000 15,000 15,000 10,000 $ 6556 Street Lighting-SCE $ 66,429 $ 63,279 $ 53,777 76,726 68,000 77,723 997 $ 6765 Sign Material $ 71,552 $ 36,270 $ 726 35,000 35,000 41,391 6,391 $ 6850 Admin Fees Transferred to GF $ 10,000 $ 10,000 $ 8,333 10,000 10,000 10,000 - $ TOTAL EXPENDITURES $ 792,454 $ 733,915 $ 752,415 $ 866,184 $ 827,273 $ 834,305 $ 7,032

Also referred to as the Highway Users Tax is derived from $.18 per gallon of gasoline sold. Revenue is divided between the State, cities and counties. The funds must be spent on street repair and maintenance within the roadway, and cannot be used to widen or extend a road.

GAS TAX FUND
7

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 26-0000 REVENUE
4325 Split Rock Bridge Construction - SBCTA $ - $ 11,549 $ 48,718 $ 419,085 $ 419,085 $ 359,085 $ (60,000) 4325 Split Rock Bridge Design/ROW - SBCTA* $ - $ - $ - $ - $ - $ 130,900 $ 130,900 4326 LTF Art 3 - City-Wide Channel Trail $ - $ 110,721 $ - $ 300,750 $ 260,750 $ 285,750 $ 25,000 4328 Split Rock Bridge Construction - CalTrans $ - $ 89,141 $ (28,190) $ 3,174,665 $ 3,114,665 $ 3,174,665 $ 60,000 4329 HSIPL Neighborhood Safety Project - Construction $ 77,739 $ - $ - $ - $ - $ - $ - 4723 HSIP Cycle 10 Two Mile, Adobe and Utah $ 6,418 $ 346,600 $ - $ - $ - $ - $ - 4725 ATP(010) SRS Construction CalTrans $ 87,091 $ 1,018,948 $ - $ - $ - $ - $ - 4741 MLHP - SR62 Str. Imp. Phase 2B** $ - $ 71,194 $ 9,453 $ 1,500,000 $ 1,500,000 $ 436,000 $ (1,064,000) TOTAL REVENUE $ 171,248 $ 1,648,153 $ 29,981 $ 5,394,500 $ 5,294,500 $ 4,386,400 $ (908,100) 26-4043 EXPENDITURES
6612 HSIP Two Mile, Adobe and Utah - Construction $ - $ 340,600 $ - $ - $ - $ - $ - 6782 Split Rock Bridge Construction $ - $ 100,690 $ 1,105,311 $ 3,593,750 $ 3,533,750 $ 3,533,750 $ - 6782 Split Rock Bridge Construction - Design/ROW $ - $ - $ 109,472 $ - $ - $ 130,900 $ 130,900 6920 ATP Safe Routes to School Construction $ 1,048,579 $ 57,460 $ - $ - $ - $ - $ - 6962 HSIPL Neighborhood Safety Project - Construction $ 77,739 $ - $ - $ - $ - $ - $ - 6971 SR62 Str. Imp. Phase 2B $ - $ 71,194 $ 63,679 $ 1,500,000 $ 1,500,000 $ 436,000 $ (1,064,000) 6974 City-wide Channel Trail Class I $ 13,779 $ 114,744 $ 15,171 $ 300,750 $ 260,750 $ 285,750 $ 25,000 TOTAL EXPENDITURES $ 1,140,097 $ 684,688 $ 1,293,633 $ 5,394,500 $ 5,294,500 $ 4,386,400 $ (908,100) * Grant Funding for the redesign phase has not been secured as of 6/9/2026. ** Grant Funding for the construction phase has not been secured as of 6/9/2026.

MAJOR LOCAL HIGHWAY PROGRAM FUND
The Major Local Highway Fund accounts for street projects funded by Major Local Highway Funds received from SBCTA, Cal-Trans or other State Funds. 8

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 27-0000 REVENUE
4245 Interest $ 97,714 $ 114,122 $ 81,367 $ 50,000 $ 50,000 $ 50,000 $ - 4455 Measure I Distribution $ 600,090 $ 571,342 $ 389,243 $ 529,702 $ 544,401 $ 533,146 $ (11,255) Reserves $ - $ - $ - $ 1,174,505 $ 1,012,976 $ 973,114 $ (39,862) TOTAL REVENUE $ 697,804 $ 685,464 $ 470,610 $ 1,754,207 $ 1,607,377 $ 1,556,260 $ (51,117) 27-4043 EXPENDITURES
6612 HSIP Two Mile, Adobe and Utah $ 20,791 $ 61,245 $ - $ 40,000 $ - $ - $ - 6772 Overlay/Chip Seal Work by Street Crew $ 265,165 $ 350,275 $ 4,710 $ 400,000 $ 400,000 $ 400,000 $ - 6782 Split Rock Bridge Const Eng/Admin $ 23,040 $ 15,572 $ 16,740 $ 539,063 $ 530,063 $ 549,698 $ 19,635 6850 Admin Fees Transferred to GF $ 10,000 $ 10,000 $ 8,333 $ 10,000 $ 10,000 $ 20,000 $ 10,000 6962 HSIPL(009) - Neighborhood Safety Engineering/Admin $ 10,448 $ - $ - $ - $ - $ - $ - 6970 Median Construction HWY 62 $ 555 $ - $ - $ - $ - $ - $ - 6971 SR62 Str. Imp. Phase 2B $ 17,335 $ 13,988 $ 7,856 $ 225,000 $ 225,000 $ 65,400 $ (159,600) 6973 El Rey Crossing Cost Sharing/Admin $ - $ - $ - $ 329,063 $ 329,063 $ 329,063 $ - 6974 City-wide Channel Trail Class I $ 9,999 $ 24,657 $ 5,435 $ 211,081 $ 113,251 $ 192,099 $ 78,848 TOTAL EXPENDITURES $ 357,333 $ 475,737 $ 43,074 $ 1,754,207 $ 1,607,377 $ 1,556,260 $ (51,117) MEASURE "I" FUND - BUDGET 2010 TO 2040
Measure I funds are derived from a one-half (1/2) percent addition to the sales taxes approved by voters of the county. The funds are for use on roads for major work rather than day-to- day repairs.
9

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 41-0000 REVENUE
4107 Homeowner
Assessments $ 12,810 $ 13,574 $ 13,205 $ 13,409 $ 13,811 $ 13,409 $ (402) 4245 Interest $ 4,258 $ 4,152 $ 2,504 $ 1,500 $ 1,500 $ 1,500 $ - Reserves $ 2,919 $ - $ - $ 8,790 $ 8,540 $ 8,540 $ -
TOTAL REVENUE $ 19,987 $ 17,726 $ 15,709 $ 23,699 $ 23,851 $ 23,449 $ (402) 41-4043 EXPENDITURES
6210 Electricity $ 430 $ 371 $ 404 $ 502 $ 527 $ 527 $ - 6212 Water $ 1,619 $ 830 $ 1,184 $ 2,547 $ 2,674 $ 2,272 $ (402) 6233 Publishing/Notices $ 238 $ - $ 137 $ 250 $ 250 $ 250 $ - 6260 Graffiti Removal $ - $ - $ - $ 400 $ 400 $ 400 $ - 6290 Maintenance Contract $ 17,700 $ 17,700 $ 16,225 $ 20,000 $ 20,000 $ 20,000 $ - TOTAL EXPENDITURES $ 19,987 $ 18,901 $ 17,950 $ 23,699 $ 23,851 $ 23,449 $ (402)

LIGHTING & LANDSCAPING DISTRICT DESERT VISTA FUND
This is an assessment District for a development within the City. The homeowners are charged on their property taxes and the proceeds are used for street lights within the project and upkeep of the landscaping around the perimeter. 10 Page 100 of 146
2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 42-0000 REVENUE
4245 Interest $ 3,606 $ 3,389 $ 1,848 $ 1,500 $ 1,500 $ 1,000 $ (500) 4500 Subscriber
Contributions $ 19,303 $ 16,302 $ 10,128 $ 14,000 $ 14,000 $ 13,000 $ (1,000) Reserves $ - $ 5,800 $ 45,340 $ 53,357 $ 44,920 $ 25,120 $ (19,800) TOTAL REVENUE $ 22,909 $ 25,491 $ 57,316 $ 68,857 $ 60,420 $ 39,120 $ (21,300) 42-0104 EXPENDITURES
6751 Agenda Management $ 19,378 $ 20,347 $ 21,364 $ 21,568 $ 22,862 $ 22,862 $ - 6776 Public Access Website $ - $ 4,235 $ 9,247 $ 4,489 $ 4,758 $ 6,258 $ 1,500 6823 Electronic Equipment $ - $ 909 $ 26,705 $ 42,800 $ 32,800 $ 10,000 $ (22,800) TOTAL EXPENDITURES $ 19,378 $ 25,491 $ 57,316 $ 68,857 $ 60,420 $ 39,120 $ (21,300)

PUBLIC ACCESS TV FUND
The City receives funds from the cable television franchisee to support public access programming. The funds are used for programming and payment for television time. 11 Page 101 of 146
2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 43-0000 REVENUE
4107 Homeowner
Assessments $ 8,249 $ 8,579 $ 8,965 $ 10,471 $ 10,995 $ 10,471 $ (524) 4245 Interest $ 86 $ 123 $ 129 $ 40 $ 40 $ 40 $ -
TOTAL REVENUE $ 8,335 $ 8,702 $ 9,094 $ 10,511 $ 11,035 $ 10,511 $ (524) 43-4043 EXPENDITURES
6210 Electricity
6212 Water $ 1,136 $ 1,322 $ 1,382 $ 1,500 $ 1,500 $ 1,500 $ - 6233 Publishing/Notices $ 238 $ - $ 137 $ 250 $ 250 $ 250 $ - 6290 Maintenance Contract $ 6,000 $ 6,000 $ 5,500 $ 8,761 $ 9,285 $ 8,761 $ (524) TOTAL EXPENDITURES $ 7,374 $ 7,322 $ 7,019 $ 10,511 $ 11,035 $ 10,511 $ (524)

LIGHTING & LANDSCAPING DISTRICTS HISTORIC PLAZA FUND
This is an assessment District for a development within the City. The homeowners are charged on their property taxes and the proceeds are used for street lights within the project and upkeep of the landscaping around the perimeter. 12 Page 102 of 146
Approved 9/9/25
2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT THROUGH THROUGH THROUGH AMENDED ADOPTED PROPOSED CODE SEPT SEPT 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 51-0000 REVENUE
4125 Visit 29! Tourism Fee $ 369,678 $ 368,288 $ 232,835 $ 350,000 $ 390,000 $ 375,000 $ (15,000) 4150 Merchandise for Resale $ 1,055 $ 875 $ 2,355 $ 500 $ 500 $ 500 $ - 4245 Interest $ 24,613 $ 23,524 $ 9,507 $ 7,000 $ 8,000 $ 10,000 $ 2,000 4890 Other/Misc. Revenue $ 15 $ - $ - $ - $ - $ - $ -
Reserves $ - $ - $ - $ 200,000 $ 164,075 $ 164,568 $ 493 TOTAL REVENUE $ 395,361 $ 392,687 $ 244,697 $ 557,500 $ 562,575 $ 550,068 $ (12,507) 51-1013 EXPENDITURES
5110 Salaries $ 105,082 $ 109,553 $ 80,981 $ 117,333 $ 123,781 $ 127,067 $ 3,286 5120 Salaries Part-time $ 15,001 $ 13,294 $ 6,761 $ 19,000 $ 19,000 $ 17,570 $ (1,430) 5250 Health Benefits $ 20,277 $ 19,443 $ 13,757 $ 20,496 $ 21,669 $ 23,058 $ 1,389 5251 Retirement Benefits $ 8,099 $ 8,696 $ 6,456 $ 9,351 $ 9,914 $ 10,088 $ 174 5252 Workers comp $ 3,505 $ 4,139 $ 3,510 $ 5,453 $ 5,711 $ 5,785 $ 74 5254 Unemployment $ - $ 3,795 $ - $ 1,000 $ 1,000 $ 1,000 $ - 6241 Office Supplies $ 2,332 $ 2,296 $ 2,293 $ 2,500 $ 2,500 $ 2,500 $ - 6244 Miscellaneous $ 3,144 $ 3,898 $ 1,457 $ 5,000 $ 5,000 $ 5,000 $ - 6245 Contingency $ - $ - $ - $ 10,000 $ 10,000 $ 10,000 $ - 6251 Meeting & Travel $ - $ 672 $ 446 $ 700 $ 500 $ 500 $ - 6291 Building & Maint $ 538 $ 1,558 $ 577 $ 1,000 $ 1,000 $ 1,000 $ - 6344 Broadcast Media & Airports $ 25,000 $ 58,845 $ 26,835 $ 69,440 $ 60,000 $ 70,000 $ 10,000 6345 Regional Print Ad's $ 21,803 $ 15,000 $ 4,700 $ 15,000 $ 15,000 $ 15,000 $ - 6347 Trade Conventions & Memberships $ 29,139 $ 3,336 $ 2,294 $ 10,000 $ 20,000 $ 10,000 $ (10,000) 6350 Reporting & Analysis $ 6,000 $ - $ - $ - $ - $ - $ - 6353 Contract Services $ 10,000 $ 19,761 $ 9,000 $ 48,000 $ 24,000 $ 48,000 $ 24,000 6356 Internet Marketing & Website Design $ 35,452 $ 35,146 $ 23,018 $ 40,570 $ 40,000 $ 40,000 $ - 6360 Special Projects $ - $ - $ 15,000 $ 20,000 $ - $ 10,000 $ 10,000 6371 Community Events/Sponsorships $ 152,013 $ 120,250 $ 95,075 $ 150,000 $ 200,000 $ 150,000 $ (50,000) 6518 Electronic Equipment $ - $ 396 $ - $ - $ - $ - $ - 6841 Legal Services $ 766 $ 8,092 $ 1,329 $ 3,000 $ 3,500 $ 3,500 $ - TOTAL EXPENDITURES $ 438,151 $ 428,170 $ 293,489 $ 547,843 $ 562,575 $ 550,068 $ (12,507)

TOURISM BUSINESS IMPROVEMENT DISTRICT (TBID) FUND
The TBID was established in 2017 to levy and collect assessments on all business that are subject to the City's Transient Occupancy Tax to raise funds for marketing the City as a tourism destination. The TBID is funded by a 1.5% Visit 29! Tourism Fee and is managed by a TBID Advisory Board. The TBID's budget process follows the fiscal year beginning on October 1st of each calendar year and ending on September 30th of the following calendar year. 13 Page 103 of 146
2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 65-0000 REVENUE
4245 Interest $ 9,763 $ 10,837 $ 8,429 $ 6,000 $ 6,000 $ 6,000 $ - 4252 Recycling Grant - SB1383 $ 43,262 $ - $ - $ 75,241 $ 75,241 $ 1,489 $ (73,752) 4257 Code Enforcement Assessments $ - $ 12,842 $ 12,576 $ 18,000 $ 18,000 $ 16,000 $ (2,000) 4262 Recycling Grant - Beverage Container Recycling $ 6,844 $ - $ 6,335 $ 6,500 $ 6,500 $ 6,000 $ (500) 4263 Perch Haul/Article 19 Fees $ 54,583 $ 62,483 $ 25,711 $ 50,000 $ 50,000 $ 50,000 $ - 4890 Other/Miscellaneous Revenue $ - $ 98,991 $ - $ - $ - $ - $ - Reserves $ - $ - $ - $ 32,842 $ 33,944 $ 59,381 $ 25,437 TOTAL REVENUE $ 114,452 $ 185,153 $ 53,051 $ 188,583 $ 189,685 $ 138,870 $ (50,815) 65-1011 EXPENDITURES
6257 Dues & Subscriptions $ - $ 4,800 $ 4,800 $ 4,800 $ 4,800 $ 4,800 $ - 6260 Graffiti removal $ - $ - $ - $ 5,000 $ 5,000 $ 5,000 $ - 6509 Recycling Programs - SB1383 $ 35,924 $ - $ 73,752 $ 75,241 $ 75,241 $ 1,489 $ (73,752) 6548 Dangerous Building
Abatement $ 9,942 $ 65,281 $ - $ 50,000 $ 50,000 $ 70,000 $ 20,000 6551 Recycling Programs - Beverage Container $ 7,616 $ 7,303 $ 6,013 $ 6,500 $ 6,500 $ 6,000 $ (500) 6560 Household Hazardous
Waste Program $ 23,142 $ 23,951 $ 24,849 $ 25,000 $ 25,000 $ 27,335 $ 2,335 6562 Mojave Desert JPA $ 21,308 $ 21,672 $ 22,044 $ 22,042 $ 23,144 $ 24,246 $ 1,102 TOTAL EXPENDITURES $ 97,932 $ 123,007 $ 131,458 $ 188,583 $ 189,685 $ 138,870 $ (50,815)

LANDFILL/LAND USE FUND
The revenues for this Fund are mainly from the recently approved Article 19 fees from the Waste Disposal Agreement (WDA) to pay for cost associated with abatement programs, recycling programs, and household hazardous waste (HHW). 14 Page 104 of 146
2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 74-0000 REVENUE
4108 Property Taxes $ 915,800 $ 881,672 $ 893,180 $ 893,181 $ 893,835 $ 893,835 $ - TOTAL REVENUE $ 915,800 $ 881,672 $ 893,180 $ 893,181 $ 893,835 $ 893,835 $ - 74-0000 EXPENDITURES
6359 Contract & Consulting SVC $ 6,050 $ 4,790 $ 10,055 $ 27,212 $ 17,142 $ 17,142 $ - 6437 Bond Interest $ 457,157 $ 443,022 $ 428,750 $ 429,969 $ 414,653 $ 414,653 $ - 6801 Bond Principal $ 389,555 $ 400,000 $ 410,000 $ 410,000 $ 435,000 $ 435,000 $ - 6850 Transfer to General Fund $ 87,500 $ 25,277 $ 26,000 $ 26,000 $ 27,040 $ 27,040 $ - TOTAL EXPENDITURES $ 940,262 $ 873,089 $ 874,805 $ 893,181 $ 893,835 $ 893,835 $ -

SUCCESSOR AGENCY NON-HOUSING FUND
The revenues from property tax increments to pay the bonds (principal and interest) associated with Project Phoenix and administration of the Successor Agency. 15 Page 105 of 146

CITY OF TWENTYNINE PALMS
Proposed Budget Revisions FY 2026-27:

Special Revenue Funds, Capital Projects Funds, & Successor Agency Fund

2 BUDGET CALENDAR
February
• Budget spreadsheets are established
• Department Heads receive mid-year budget-to-actual results March
• Department Heads submit budget requests to Finance Director • Department Heads meet with Finance Director to review preliminary budget estimates • Major revenue projections are received (e.g., TOT for the first two quarters of the FY, Sales tax, Property tax) April
• Major expenditure projections are received (e.g., COLA, Sheriff’s contract, insurance, health and retirement benefits, etc.,) • Budget Committee meets to review preliminary budget for the General Fund • Preliminary budget for the General Fund is presented to City Council May
• Public hearing and budget adoption of the General Fund June
• Public Hearing and budget adoption of the Special Revenue Funds, Capital Projects Funds, Successor Agency Fund, Project Phoenix Funds, and Sewer Fund
• Year-end review begins
July
• New Fiscal Year begins

CITY’S FUND STRUCTURE
General Fund The General Fund is the chief operating fund of a government. It accounts for all financial resources of the City, except those required to be accounted for in another fund.

Special Revenue
Funds
These funds are established by the City Council or other agencies to collect money that must be used for a specific project or purpose. These funds provide an extra level of accountability and transparency to taxpayers and/or ratepayers that their tax or fee dollars will go towards an intended purpose.

Capital Projects
Funds
These funds account for the financial resources used for the acquisition or construction of major capital facilities and other capital related projects (other than those financed in the proprietary fund types).

Proprietary Funds
These funds are used by government entities to account for activities that are similar to business-type activities. These funds are used when a government provides services to the public or other government agencies on a cost-reimbursement basis. Proprietary Funds are categorized into two main types: Enterprise Funds and Internal Service Funds.

Fiduciary Funds
These funds account for resources that are held in a trustee or agency capacity for others and cannot be used to support the government’s own programs. Fiduciary funds are categorized into four types: Pension (and Other Employee Benefit) Trust Funds, Investment Trust Funds, Private-Purpose Trust Funds, and Custodial Funds. 3 Page 108 of 146
CITY’S FUND STRUCTURE, CONT. Funds
Government
General Fund (1)
Special Revenue Funds (10)
- Community Development Block Grant (CDBG) Fund
- Elm Avenue Project Fund
- Road Maintenance Rehab Account (RMRA) SB1 Fund
- Gas Tax Fund
- Measure I Fund
- Lighting & Landscaping Districts (2) - Desert Vista and Historic Plaza (1)
- Public Access TV Fund
- Tourism Business Improvement District (TBID) Fund
- Landfill/Land Use Fund
Capital Projects Funds (5)
- General Capital Projects Fund
- Curb, Gutter, & Sidewalk Impact Fee Fund
- Development Impact Fee – Transportation Fund
- Major Local Highway Program Fund
- Project Phoenix Housing Fund (2)
Proprietary Enterprise (1) - Sewer Fund
Fiduciary Private-Purpose Trust (1) - Successor Agency to the Twentynine Palms Redevelopment Agency Fund
4 (1) Combined for financial reporting purposes.
(2) These funds and any activity from the Project Phoenix project will be presented separately to avoid a perceived conflict of interest.

PROPOSED BUDGET REVISIONS
Summary(1)
5 Adjustments
26/27 Proposed
Budget
26/27 Adopted
Budget
Special Revenue Funds and
Capital Projects Funds
Revenues & Transfers In $12,015,902 $11,416,702 $(599,200) Use of Reserves $2,490,962 $2,859,768 $368,806
Expenditures & Transfers Out $14,396,864 $14,153,217 $(243,647) (1) Excludes Sewer Fund and Project Phoenix Funds and related activity. (2) No revisions were needed for this fund.
26/27 Proposed
Budget(2)
Successor Agency Fund
Revenues $893,835
Expenditures & Transfers Out $893,835

REVENUE/TRANSFERS IN SOURCES
26/27 Proposed Adjustments
Budget
26/27 Adopted
Budget
Revenues/Transfers
Tax Revenue $2,159,315 $2,158,060 $(1,255)
Property Tax – Successor Agency $893,835 $893,835 $ - (1) Grants $9,006,241 $8,234,786 $(771,455) (2)
Fees $571,306 $636,816 $65,510 (3)
Other Revenues $98,040 $105,040 $7,000 (4)
General Fund Transfers In $181,000 $282,000 $101,000
6 (1) Fiduciary Fund – Private Purpose Trust Fund. The resources from this fund cannot be used to support the City’s own programs.
(2) Include grants from CalTrans, the San Bernardino County, and SBCTA. (3) Include impact fees, assessment fees, and TBID fees. (4) Include interest revenue and other miscellaneous revenue.

TAX REVENUE SOURCES
7 26/27 Proposed Adjustments
Budget
26/27 Adopted
Budget
Fund
RMRA SB1 $792,641 $795,609 $2,968 (1)
Gas Tax $822,273 $829,305 $7,032 (2)
Measure I $544,401 $533,146 $(11,255) (3)
TOTAL $2,159,315 $2,158,060 $(1,255)
(1) RMRA SB1 Funds are restricted for major road work rather than day to day repairs.
(2) Gas Tax funds are restricted for street repairs and maintenance within a City roadway. Funds cannot be used to widen or extend a road. (3) Measure I funds are restricted for major transportation improvements.

GAS/RMRA SB1 TAX REVENUE HISTORY
$495,975 $501,529 $542,400
$590,628 $617,860
$679,370
$771,654 $748,372
$795,609
$529,808
$633,642 $647,986
$712,707 $707,358 $725,691
$799,956 $816,360 $829,305
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
$700,000
$800,000
$900,000
FY 18/19 FY 19/20 FY 20/21 FY 21/22 FY 22/23 FY 23/24 FY 24/25 FY 25/26 - Forecast
FY 26/27 -
Proposed
RMRA SB1 Tax Revenue Gas Tax
8 Page 113 of 146
RMRA SB1 PROJECTS FOR FY 26/27:

STREET RESURFACING
9 Street From To Length (LF) Tons
Siesta Dr. Morongo Rd. Encelia Dr. 2,650' 800
Mariposa Ave. Two Mile Rd. Samarkand Dr. 2,630' 750
Morongo Rd. Two Mile Rd. Samarkand Dr. 2,630' 600
Aspen Dr. Datura Ave. Mission Ave. 860' 175
Juniper Ave. Sullivan Rd. Foothill Dr. 1265' 325
Adobe Circle Two Mile Rd. Two Mile Rd. 2,990' 750
Quail Spring Ave. Outer Hwy 62 Sullivan Rd. 2,550' 650
Cottonwood Dr. Canyon Rd. Bermuda Ave. 650' 175
Galleta Ave. Outer Hwy 62 Cottonwood Dr. 1,890' 400
Bermuda Ave. Outer Hwy 62 Cottonwood Dr. 1,890' 300
Alpine Ave. Hwy 62 Hatch Rd. 790' 225
La Luna Ave. Hwy 62 Hatch Rd. 1,210' 300
TOTAL 22,005’ 5,450

MAJOR CAPITAL PROJECTS – FY 2026-27
10 Project Type Amount
Streets $2,791,314
Parks $868,746
Safety $8,287,435
Other Projects $1,368,989
TOTAL $13,316,484

STREET PROJECTS
11 Project Name Amount Funding Source
Roads Overlay $1,195,609 SB1/Measure I
Street Repairs and Maintenance $854,305 Gas Tax/Measure I MLHP(1) SR62 Str. Improvement Phase 2B $501,400 /Measure I Street Improvements – Citywide $150,000 Development Impact Fees (2) CG&S(3) Curb, Gutter, & Sidewalk Projects $90,000 Impact Fees TOTAL $2,791,314
(1) Major Local Highway Program
(2) Proposed streets include Adobe Rd., Lear Ave., Mesquite Springs Rd., Amboy Rd., Two-mile Rd., Hatch Rd., Sullivan Rd., and Twentynine Palms Hwy.
(3) Curb, Gutter, & Sidewalk

PARKS PROJECTS
12 Project Name Amount Funding Source
Citywide Channel Trail $477,849 Capital Projects Fund
CDBG(2) Luckie Park Renovations $340,897 Fund/Capital Projects Fund (1) MLHP(3) Playground Equipment $50,000 /Measure I
TOTAL $868,746
(1) Includes Luckie Park Pedestrian Pathways ($145K), Luckie Park Activity Center Parking Lot Improvements ($156K), and Project Management costs associated with those projects ($40K) (2) Community Development Block Grant
(3) Major Local Highway Program

SAFETY PROJECTS
13 Project Name Amount Funding Source
MLHP(1) Split Rock Bridge $4,214,348 /Measure I
Hatch/Sullivan Bike Path $3,744,024 Capital Projects Fund El Rey Crossing $329,063 Measure I (2)
TOTAL $8,287,435
(1) Major Local Highway Program
(2) Project has been completed but City’s cost has not been reimbursed to the San Bernardino Flood Control District. Page 118 of 146

OTHER PROJECTS
14 Project Name Amount Funding Source
New Animal Shelter $588,826 Capital Projects Fund
Re-roof Projects $225,750 Capital Projects Fund
Senior Center Improvements $196,019 Capital Projects Fund Animal Control Building Upgrades $178,394 Capital Projects Fund Well Repair $50,000 Capital Projects Fund
City Hall Structures $45,000 Capital Projects Fund
Safety & Security Projects $35,000 Capital Projects Fund Flood Monitoring Equipment $35,000 Capital Projects Fund Parks Dump Truck $15,000 Capital Projects Fund
TOTAL $1,368,989

RECOMMENDATIONS
Staff recommends City Council to:

1. Approve Resolution No. 26-__, adopting the budget revisions for the Special Revenue Funds (excluding Project Phoenix Funds), Capital Projects Funds, and Successor Agency Fund for FY 2026-27.

2. Approve interfund transfers for FY 2026-27
 Admin Fees:
• $10,000 from Gas Tax Fund to General Fund;
• $20,000 from Measure I Fund to General Fund; and
• $27,040 from Successor Agency Fund to General Fund.

3. Approve the changes to the FY 2025-26 budget for the following funds:  Amendments to the General Capital Projects Fund.  Establishment and adoption of the new Elm Avenue Project Fund budget. 15 Page 120 of 146

PROPOSED BUDGET REVISIONS
Questions?
16 Page 121 of 146

STAFF REPORT
TO: City Council
FROM: Finance Director
FOR MEETING: Jun 23 2026
SUBJECT: Proposed Budget Revisions for Project Phoenix Funds and Enterprise Fund for Fiscal Year 2026-

27. RECOMMENDATION:

The City Council approve the following:

1. Resolution No. 26-__, approving the budget revisions for the Project Phoenix Funds and Enterprise Fund for FY 2026-27;

2. Interfund transfers from the General Fund to the Sewer Fund for FY 2026-27 as follows:
 $70,000 to subsidize the operating costs of this fund.  $25,000 for a sewer rate study
ORDER OF PROCEDURE:

Request Staff Report (Finance Director Presenting)
Council Question of Staff
Open the Public Hearing
Request Public Comment
Close the Public Hearing
Council Discussion
Motion/Second
Discussion of Motion
Call the Question
ATTACHMENTS:
• Resolution No. 26- __ Project
Phoenix Funds FY 2026-27
• Attachment A - Proposed
Budget Revisions Project
Phoenix Funds and Enterprise
Fund FY 2026-27
• FY 2026-27 Proposed Budget
Revisions for Project Phoenix
Funds and Enterprise Fund -
Presentation
BACKGROUND:

The Finance Director is presenting the proposed budget revisions for the Project Phoenix Funds and Enterprise Fund for Fiscal Year 2026-27. City Council is required to approve the revisions before the beginning of the new Fiscal Year, which begins July 1, 2026.

Project Phoenix Funds account for the activities associated with the City's downtown revitalization project. The City has the following open projects, which will be funded with Project Phoenix funds:

Project Description Amount
Store Front Improvements $108,987
Public Art $33,500
Street Furniture $29,319
Site Improvements $25,950
Multi-purpose Facility Fixtures $24,651
TOTAL $222,407
On February 24, 2026, City Council approved the reallocation of $15K out of the Public Art funding for the tile mural project within Freedom Plaza, which is to be funded partially with a grant from the California Arts Council.

As of June 10, 2026, the Project Phoenix Housing Fund has a fund balance of $1.1M, which is comprised of $682K from bond proceed reserves and $477K from the sale of real property by Freedom Plaza and accumulated interest income. These funds can only be used for affordable housing projects, including consulting, legal fees and property acquisitions costs associated with those projects.

Enterprise Fund - Sewer
The Enterprise fund was created to account for the cost of providing sewer services to a limited number of businesses within the relatively new Freedom Plaza. The revenues collected from sewer service fees are used to pay for the operations and maintenance of the sewer collection system including, inspections, pumping, water quality monitoring, and permitting. Operating & Maintenance costs are projected to be $82K in FY 2026-27, while charges for services are expected to be approximately $12K per year. The operating deficit of $70K in FY 2026- 27 will be subsidized by a transfer from the General Fund.

STAG 1 and STAG 2 grants from the U.S. Environmental Protection Agency (EPA) have been reallocated for the City's USGS Study. The total cost of the study is projected to be $2.4M, of which $2.2M is expected to be funded with STAG1 and STAG2 grants and contributions from the 29 Palms Water District and USGS. The City's request of a cost share waiver for the City's 20% match requirement for Community Grants Program has been approved.

However, the City still needs approximately $99K to cover the unfunded portion of the project. A reallocation from the 2024 Consolidated Appropriations Act will be requested to fund the remaining balance for this study. If the reallocation is not granted, then the City will have to fund the shortfall. Additionally, the 29 Palms Water District has expressed an interest in working with the City and USGS to implement cost-cutting measures to reduce / eliminate this shortfall.

The City construction phase of the Project Phoenix Package Treatment Plant is at the final stages. The construction phase of this project is expected to be $2.2M, which will be funded by a $1.7M grant from the Economic Development Administration (EDA) and the remainder from General Fund transfers. The project must be completed by September 2026. At that time, the City must also have a management plan and a sewer rate structure. As such, City Staff is requesting a $25K from the General Fund to the Sewer Fund for a Sewer Rate Study.

ENVIRONMENTAL:

N/A
ALTERNATIVES:

The City Council could reject, add, or reduce any of Staff’s spending recommendations.

FISCAL IMPACT:

A balanced budget for Project Phoenix Funds; however, the Sewer Fund shows a projected deficit of approximately $99K for the unfunded portion of the USGS study. If no additional grant funds are secured to fund this deficit, Staff will come back to City Council to request additional funds to complete the study.

CITY OF TWENTYNINE PALMS

CITY COUNCIL
RESOLUTION NO. 26- ____

A RESOLUTION OF THE CITY COUNCIL O F THE CITY OF TWENTYNINE

PALMS, CALIFORNIA, ADOPTING THE B U D G E T R E V I S I O N S O F T H E CITY’S PROJECT PHOENIX FUNDS AND ENTERPRISE FUND FOR FISCAL YEAR 2026/2027
WHEREAS, the City Council is adopting a budget before the beginning of Fiscal Year July 1, 2026; and
WHEREAS, the City Council has reviewed the budget and accepted public input.

NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Twentynine Palms, California, adopts the budget revisions, attached as Exhibit “A” and incorporated by reference to this Resolution, for the Fiscal Year ending June 30, 2027 as follows:

1. The adopted budget for the Project Phoenix Funds for Fiscal Year 2026/2027 is $1,338,407;

2. The adopted budget for the Enterprise Fund for Fiscal Year 2026/2027 is $3,697,785;

3. The legal level of budgetary control is at the fund level. The City Manager is authorized to transfer appropriations between accounts within each fund as long as the total adopted budget allocation of that fund is not exceeded.

4. Transfers from fund to fund will require approval of the City Council, if not approved in the budget.

5. This Resolution shall be effective July 1, 2026.

PASSED, APPROVED, AND ADOPTED on the 23rd day of June 2026.

Daniel L. Mintz, Sr., Mayor
ATTEST:

Cindy Villescas, CMC
City Clerk

I, do hereby certify that the foregoing Resolution No. 26-___, was duly adopted by the City Council of the City of Twentynine Palms at a regular meeting thereof held on 23rd day of June, 2026, by the following vote:

AYES: COUNCILMEMBER:

NOES: COUNCILMEMBER:

ABSENT: COUNCILMEMBER:

ABSTAIN: COUNCILMEMBER:
_________________________________
Cindy Villescas, CMC
City Clerk

REVISED BUDGETS
FISCAL YEAR 2026-27

CITY OF TWENTYNINE PALMS

PROJECT PHOENIX FUNDS

AND SEWER FUND

APPROVED
2/24/26

APPROVED
6/10/25
2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 10-0000 REVENUE
4890 Other/Miscellaneous Revenue $ - $ - $ 18,500 $ - $ - $ 18,500 $ 18,500 Reserves $ 104,016 $ 62,015 $ 3,900 $ 185,457 $ 202,957 $ 203,907 $ 950 TOTAL REVENUE $ 104,016 $ 62,015 $ 22,400 $ 185,457 $ 202,957 $ 222,407 $ 19,450 10-1014 EXPENDITURES
6365 Preliminary Design & Engineering $ - $ 2,650 $ 3,900 $ 7,500 $ - $ 950 $ 950 6366 Project Phoenix - Site Improvements $ - $ - $ - $ - $ 25,000 $ 25,000 $ - 6830 Project Phoenix - Public Art $ - $ - $ - $ 15,000 $ 15,000 $ 33,500 $ 18,500 6831 Project Phoenix - Store Front Improvements $ 102,018 $ 55,434 $ - $ 108,987 $ 108,987 $ 108,987 $ - 6833 Project Phoenix - Street Furniture $ - $ - $ - $ 29,319 $ 29,319 $ 29,319 $ - 6906 Project Phoenix-Multi-Purpose Facility Fixtures $ 1,998 $ 3,931 $ - $ 24,651 $ 24,651 $ 24,651 $ - TOTAL EXPENDITURES $ 104,016 $ 62,015 $ 3,900 $ 185,457 $ 202,957 $ 222,407 $ 19,450

GENERAL CAPITAL PROJECTS FUND
The Capital Improvement Fund tracks grants and projects that aren't related to Community Development Block Grants. 1

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET* ADJUSTMENTS 77-0000 REVENUE
4245 Interest $ 43,943 $ 41,550 $ 26,226 $ 25,000 $ 25,000 $ 25,000 $ - Bond Reserves $ 29,441 $ - $ - $ 1,091,000 $ 1,091,000 $ 1,091,000 $ - TOTAL REVENUE $ 73,384 $ 41,550 $ 26,226 $ 1,116,000 $ 1,116,000 $ 1,116,000 $ - 77-1014 EXPENDITURES
6??? Affordable Housing Projects $ - $ - $ - $ 1,000,000 $ 1,000,000 $ 1,000,000 $ - 6364 Site Planning $ 3,000 $ - $ - $ - $ - $ - $ -
6841 Legal $ 19,473 $ 1,481 $ - $ 26,000 $ 26,000 $ 26,000 $ - 6842 Consulting Services $ 3,000 $ - $ - $ - $ - $ - $ - 6865 Property Acquisition $ 47,911 $ - $ - $ 90,000 $ 90,000 $ 90,000 $ - TOTAL EXPENDITURES $ 73,384 $ 1,481 $ - $ 1,116,000 $ 1,116,000 $ 1,116,000 $ - * $1.1M has not been committed to any particular project thus far.

PROJECT PHOENIX HOUSING FUND
This fund was created to track the activities of the City's downtown revitalization project that consists of public buildings and housing. 2

2023-2024 2024-2025 2025-2026 2025-2026 2026-2027 2026-2027

ACCOUNT BUDGET BUDGET THROUGH AMENDED ADOPTED PROPOSED
CODE ACTUAL ACTUAL 6/9/2026 BUDGET BUDGET BUDGET ADJUSTMENTS 80-0000 REVENUE
4252 County ARPA Grant $ 502,568 $ - $ - $ - $ - $ - $ - 4255 EDA Grant $ - $ 565,052 $ - $ 1,675,680 $ 1,000,000 $ 1,000,000 $ - 4316 Transfer In $ 65,000 $ 70,000 $ 58,333 $ 150,000 $ 70,000 $ 95,000 $ 25,000 4880 Charge for Services $ 13,004 $ 12,713 $ 13,822 $ 12,200 $ 12,200 $ 12,200 $ - 4890 Other Revenue - Contributions $ - $ - $ - $ 292,792 $ 292,792 $ 395,146 $ 102,354 4891 Clean Water Planning Loan $ 45,717 $ - $ - $ - $ - $ - $ - 4892 Federal Earmark - STAG1 $ - $ - $ 39,456 $ 663,224 $ 663,224 $ 663,224 $ - 4892 Federal Earmark - STAG2 $ - $ - $ - $ 1,275,000 $ 1,275,000 $ 1,275,000 $ - Reserves $ 61,998 $ 163,162 $ - $ 482,917 $ 158,597 $ 158,597 $ - TOTAL REVENUE $ 688,287 $ 810,927 $ 111,611 $ 4,551,813 $ 3,471,813 $ 3,599,167 $ 127,354 80-???? EXPENDITURES
1014-6837 Package Treatment Plant $ - $ 728,214 $ 1,226,205 $ 2,209,427 $ 1,129,427 $ 1,129,427 $ - 1014-6837 Package Treatment Plant - Design $ 6,575 $ - $ - $ 29,170 $ 29,170 $ 29,170 $ - 1014-6865 Package Treatment Plant - Extension $ 500 $ - $ - $ - $ - $ - $ - 0000-6365 Preliminary Design - Collection System $ 15,749 $ - $ - $ - $ - $ - $ - 0000-6821 Funding Plan - Sewer Rate Study $ - $ - $ - $ - $ - $ 25,000 $ 25,000 0000-6821 Funding Plan - Collection System $ 1,125 $ - $ - $ - $ - $ - $ - 0000-6359 Wastewater Treatment Planning $ 10,082 $ - $ - $ - $ - $ - $ - 0000-6843 Environmental Analysis $ 9,508 $ - $ - $ - $ - $ - $ - 0000-6837 Wastewater Treatment Plant $ 42,666 $ - $ - $ - $ - $ - $ - 0000-6359 Outreach $ 4,419 $ - $ - $ - $ - $ - $ -
0000-6822 USGS Study $ - $ - $ 100,003 $ 2,330,289 $ 2,330,289 $ 2,431,988 $ 101,699 0000-6838 Collection System - Full Design $ 126,039 $ - $ - $ - $ - $ - $ - 0000-6841 Legal Services $ 249 $ - $ - $ - $ - $ - $ -
0000-7980 Depreciation Expense $ 31,168 $ 31,168 $ - $ - $ - $ - $ - 80-4047 Sewer Department
6533 Maintenance $ 50,504 $ 47,944 $ 87,898 $ 82,200 $ 82,200 $ 82,200 $ - TOTAL EXPENDITURES $ 298,584 $ 807,326 $ 1,414,106 $ 4,651,086 $ 3,571,086 $ 3,697,785 $ 126,699 This fund was created to account for the cost of providing sewer services to the general public and the user charges by which these costs are recovered.

ENTERPRISE FUND

SEWER FUND
3

CITY OF TWENTYNINE PALMS
Proposed Budget Revisions FY 2026-27:

Project Phoenix Funds and Enterprise Fund

DESCRIPTION OF FUNDS PRESENTED
Project Phoenix Funds account for the
activities associated with the City’s downtown
revitalization project.

Enterprise Fund was created to account for the
cost of providing sewer services to a limited
number of businesses within the relatively new
Freedom Plaza and the user charges by which
these costs are recovered.
2 Page 132 of 146

PROJECT PHOENIX FUNDS
FY 2026-27
Proposed Budget
Revenue Sources
Grant $18,500 (1)
Reserves $203,907
Housing Funds $1,106,000 (2)
3 (1) Grant for the California Arts Council for the tile mural project within Freedom Plaza (2) The Project Phoenix Housing Fund has a fund balance of $1.1M which is comprised of $682K from bond proceed reserves and $477K from the sale of real property by Freedom Plaza and accumulated interest income. These funds will be used for affordable housing projects, including legal fees associated with the project(s).

Summary of Revenue Sources from Project Phoenix Funds

PROJECT PHOENIX FUNDS, CONT.

Project Phoenix (PP) Funds open projects
4 Project Name Amount Funding Source
Store Front Improvements $108,987 General Capital Projects Fund Public Art $33,500 General Capital Projects Fund (1)
Street Furniture $29,319 General Capital Projects Fund
Site Improvements $25,950 General Capital Projects Fund Multi-Purpose Facility Fixtures $24,651 General Capital Projects Fund TOTAL $222,407
(1) On February 24, 2026, City Council approved the reallocation of the $15K Public Art funding from the Project Phoenix funds for the tile mural project within Freedom Plaza, which is to be funded partially with a grant from the California Arts Council.

ENTERPRISE FUND: SEWER FUND
26/27 Proposed Funding Source
Budget
Project Description
USGS Study $2,431,988 Grants/Contributions/City Funds (1) Project Phoenix Package Treatment Plant $1,158,597 EDA Grant/City Match Operating Expenses $82,200 Sewer Fees/City Subsidy
Sewer Rate Study $25,000 Transfer from General Fund
TOTAL $3,697,785
5 (1) This project is underfunded by $99K. The City will work closely with the 29 Palms Water District and USGS to implement cost-cutting measures to reduce or eliminate this shortfall.

RECOMMENDATIONS
Staff is recommending the following actions:

1. Adopt Resolution No. 26-__ approving the budget revisions for the Project Phoenix Funds and Enterprise Fund for FY 2026-27.

2. Approve the interfund transfers from the General Fund to the Sewer Fund for FY 2026-27 as follows:  $70,000 to subsidize the operating costs of this fund.  $25,000 for a sewer rate study 6 Page 136 of 146

PROPOSED BUDGET REVISIONS
Questions?
7 Page 137 of 146

STAFF REPORT
TO: City Council
FROM: City Manager
FOR MEETING: Jun 23 2026
SUBJECT: Update on a Local Sales Tax Ballot Measure for the November 3, 2026, General Election.

RECOMMENDATION:

The City Council receive this update on community engagement and public opinion research on a potential 1% sales tax measure for the City of Twentynine Palms and provide direction for returning for legislative action.

ORDER OF PROCEDURE:

Request Staff Report (City Manager Presenting)
Council Question of Staff
Request Public Comment
Council Discussion
Motion/Second
Discussion of Motion
Call the Question
ATTACHMENTS:
• FACT Sheet
• FAQ Sheet
• Mailer
BACKGROUND:

The City is facing a severe and increasing structural deficit, meaning that expenses have and will continue to grow faster than revenues. As costs continue to rise, cities must identify new sources of revenue to prevent reducing the number and quality of city services. Within the last five years, the Town of Yucca Valley, cities of Palm Desert, Indio, and Cathedral City have passed sales tax measures. These measures have been vital in helping cities keep up with rising costs, maintain current levels of service, and in some cases enabling the City to afford new services to meet resident needs. Without these tax measures, cities may be forced to reduce or eliminate key quality-of-life services.

Despite significant efforts to improve economic conditions within the City of Twentynine Palms, City revenues have remained flat and are projected to either remain flat or slightly decline. Flat or declining revenues are not unique to Twentynine Palms but are rather symptomatic throughout the State. Despite consistent efforts to “tighten the belt”, operating expenses continue to increase. Staff believes a 1% sales tax measure is something the City Council must consider as a possible means to maintain or improve core city services such as road maintenance, parks, law enforcement, fund animal shelter operations and overall City services.

To assist the City Council and Staff in understanding community needs and preferences, during the October 14, 2025, City Council meeting, Staff recommended and City Council approved engaging Probolsky Research to conduct a scientific communitysurvey. Following the October 14th City Council meeting, Staff began working with Probolsky Research to create and implement the needed survey. On Saturday, January 17, 2026, Probolsky Research finished the requested community survey. Page 139 of 146 During the October 14th and December 9th City Council meetings, Staff also discussed the vital role outreach consultants have in helping the City understand community needs and assist City Council/Staff in gathering and addressing questions. Based on the positive survey results, the City Council authorized engagement of Clifford Moss to further the outreach effort. Here is a synopsis of what has been accomplished to date.

Starting in 2023, the City of Twentynine Palms conducted two scientific surveys to gather community input from residents about key issues, City priorities, and possible future funding considerations.

Additionally, the City conducted extensive outreach through one-on-one conversations and started a comprehensive and multi-channel engagement strategy. In March 2026, a citywide mailer was sent to over 5,000 Twentynine Palms voter households, which included an invitation to a community survey and a QR code linking to a dedicated webpage with an opportunity to receive additional information and provide input about the City's priorities. The survey generated 682 responses, including 542 written comments, providing valuable insight into what matters most to residents. The survey was also promoted through ad placements on META/Facebook, with four published video advertisements and nine customized static advertisements. These digital efforts achieved a total of 184,000 impressions, 13,455 clicks, with a click-through rate of 7.31%, along with 41,726 post engagements. Following that first mailer, a second mailer was sent to residents reporting back what was heard in the survey and outlining the next steps. This work was conducted to help guide and inform the City Council's decision on whether to move forward with potential 2026 revenue measure.

Next Steps:

The purpose of this item is to receive the report and discuss any outstanding questions or concerns, schedule, and next steps.

Staff will receive input from the City Council on the information presented at this meeting.

ENVIRONMENTAL:

N/A
ALTERNATIVES:

N/A
FISCAL IMPACT:

There will be election costs associated with the placement of the measure on the November 2026 ballot. Actual costs will depend on factors such as the number of pages that need to be printed (ballot length), the quantity of guides/ballots to be printed, notices, and translation services.

Background: It is the City of Twentynine Palms' responsibility to provide public services and facilities that maintain and protect our community's quality of life. City employees work hard every day to provide the services that residents tell us they value most: maintaining streets and sidewalks, public safety and police patrols, rapid response in 911 emergencies, keeping parks and trails healthy, safe, effective animal control and shelter services, and much more.

The City of Twentynine Palms strives to use resources wisely. We are committed to serving our community in a fiscally responsible manner and have been proactive in planning and controlling costs. The City continues to be strategic to ensure continuity of the most critical services and programs valued by our community.

Current Status: Since 1987, the City of Twentynine Palms, without a sales tax, and without creating an extra burden on our community, has accomplished the following:
• Despite having a mere 5-person road crew, the City’s Public Works Department quickly and cost-effectively cleared 170 miles of roads following multiple major flooding events, and maintain a pavement condition index 20% above the average of all Coachella Valley cities.
• Added a second Sheriff detective to improve timeliness and success of criminal prosecutions. • Paws n Palms Shelter’s save rate is nearly 3x higher than the national average, despite operating out of an inadequate facility.
• Our six-member Parks and Recreation Department serves 1,200 youth annually across three separate parks.

Even with fiscally prudent practices, the City has identified several needs that must be addressed to maintain and protect the City’s standard of living. Engaging our community and LISTENING are essential to reaching community consensus on the best way forward, before important decisions are made. As always, our goal is to plan proactively and navigate strategically to address community needs responsibly and with your support.

The City's top service priorities include:
• REPAIRING AND MAINTAINING city streets
• PROVIDING effective public safety, police officers, patrols, and rapid 911 response times • PREPARING the City for emergencies (including flooding, fire, earthquakes, and traffic accidents) • PRESERVING parks, trails, and open spaces
• MAINTAINING animal control services and ensuring the animal shelter meets basic health and safety standards To protect Twentynine Palms' quality of life, one option currently being discussed is a modest 1% sales tax, providing approximately $2 million annually until ended by voters; a step that would require local voter support to go into effect.

Twentynine Palms is one of the few communities in the region without a local sales tax. While this has worked for our city in the past, our funding needs have increased. By law, the State could not take these funds away or use them for other purposes. NO DECISIONS HAVE BEEN MADE YET.

Visitors pay their fair share. Visitors and tourists would pay a large percentage of the proposed sales tax generated in Twentynine Palms, meaning non-residents help pay to maintain our streets, police, and other services. Passing a local sales tax measure keeps revenue local; instead of funding other cities, the dollars you already spend would stay in Twentynine Palms to maintain our roads, support public safety, and improve local services.

This measure is designed to protect local families. Groceries and prescription medications would be exempt, ensuring the tax does not apply to essentials. This means residents can support needed improvements to City services without increasing the cost of basic necessities, keeping the impact low while delivering important benefits for the community.

Taxpayer protections would be required by the measure. All funds raised by the potential measure we're exploring would go to the City's General Fund to be used for Twentynine Palms city services and facilities. Any funds generated would stay locally controlled in the City of Twentynine Palms. The measure will require oversight, independent financial audits, and yearly reports to the community to ensure the funds are spent as promised.

Currently, the City of Twentynine Palms is taking deliberate steps to reach out and LISTEN to our community. No final decisions have been made yet on this issue. For more information, visit www.ci.twentynine-palms.ca.us/ or contact [email protected].

City of Twentynine Palms
2026 City Budget Community Conversation

FACT SHEET

City of Twentynine Palms
2026 City Budget Community Conversation
Frequently Asked Questions (FAQ)
Why is the City reaching out to me? What is this City project all about? It is the City of Twentynine Palms' responsibility to provide public services and facilities that maintain and protect our community's quality of life. City employees work hard every day to provide the services that residents tell us they value most: maintaining streets and sidewalks, public safety and police patrols, rapid response in 911 emergencies, keeping parks and trails healthy, safe, effective animal control and shelter services, and much more.

The City of Twentynine Palms strives to use resources wisely. We are committed to serving our community in a fiscally responsible manner. To protect the local quality of life, we have been proactive in planning and controlling costs. The City continues to be strategic to ensure continuity of the most critical services and programs valued by our community.

Even with fiscally prudent practices, the City has identified several needs that must be addressed to maintain and protect the City’s standard of living. Engaging our community and LISTENING are essential to reaching community consensus on the best way forward, before important decisions are made. As always, our goal is to plan proactively and navigate strategically to address community needs responsibly and with your support.

What are the City’s top priorities?
• REPAIRING AND MAINTAINING city streets
• PROVIDING effective public safety, police officers, patrols, and rapid 911 response times • PREPARING the City for emergencies (including flooding, fire, earthquakes, and traffic accidents) • MAINTAINING parks, trails, and open spaces
• MAINTAINING animal control services and ensuring the animal shelter meets basic health and safety standards
What is the City doing to manage its finances responsibly? Our City has a proud history of financial prudence. Every day, we focus City resources on providing direct services to Twentynine Palms residents and community members in a sensible and responsible manner.

We have been proactive in planning and controlling costs to ensure continuity of the most critical services and programs valued by our community.

Since 1987, the City of Twentynine Palms, without a sales tax, and without creating an extra burden on our community, the City has accomplished:
• Despite having a mere 5-person road crew, the City’s Public Works Department quickly and costeffectively cleared 170 miles of roads following multiple major flooding events, and maintain a pavement condition index 20% above the average of all Coachella Valley cities. • Added a second Sheriff detective to improve timeliness and success of criminal prosecutions. • Paws n Palms Shelter’s save rate is nearly 3x higher than the national average, despite operating out of an inadequate facility.

• Our six-member Parks and Recreation Department serves 1,200 youth annually across three separate parks.

Why does the City need more funding?
The City's General Fund Budget provides funding for City services, programs, and facilities. Despite our fiscally prudent practices and proactive cost control efforts, the strain on vital city services is growing as ongoing expenses outside of the City’s control continue to outpace available resources.

For example, the City of Twentynine Palms relies on the San Bernadino County Sherriff’s Department for public safety services, like neighborhood police patrols and emergency response. Law enforcement represents the largest expense in the City’s budget, and has continued to increase over time. This year, the cost of the contract with the Sherriff’s Department will be increased by 10%. Additional funding is essential to sustain our current City services and protect Twentynine Palms' quality of life.

How has the City involved the community in this effort? To help protect vital City services and Twentynine Palms' quality of life, City leaders have been evaluating all possible options for generating the additional revenue needed to address identified needs. No decisions have been made yet. The City is currently elevating the public conversation by conducting a Community Listening Initiative to actively seek input that can inform community consensus and future City decision-making. In April, the City sent out a community survey mailer to Twentynine Palms residents to hear directly about what matters most to them. In May, the City sent a follow-up mailer reporting results and explaining next steps—click here to view the follow-up.

What possible solutions have been identified?
To protect Twentynine Palms' quality of life, one option currently being discussed is a modest 1% sales tax, providing approximately $2 million annually until ended by voters; a step that would require local voter support to go into effect.

Twentynine Palms is one of the few communities in the region without a local sales tax. While this has worked for our city in the past, our funding needs have increased. By law, the State could not take these funds away or use them for other purposes. NO DECISIONS HAVE BEEN MADE YET.

How much additional funding would a 1% sales tax generate for the City? A 1% sales tax would raise approximately $2 million per year for City services. ALL funds generated by a local sales tax would be locally controlled, subject to annual public review, and would stay in Twentynine Palms to provide essential city services and facility improvements. By law, the State could not take this funding away or use it for other purposes.

What would a sales tax apply to? What’s taxed and what isn’t? A local sales tax would apply to the same goods and services subject to the existing state sales tax on tangible personal property. For example: furniture, cars, giftware, toys, antiques, clothing and gasoline are subject to local sales taxes.

Groceries and prescription medications would be exempt, ensuring the tax does not apply to essentials. This means residents can support needed improvements to City services without increasing the cost of basic necessities, keeping the impact low while delivering important benefits for the community.

How does Twentynine Palms compare with nearby cities on sales tax rates? Twentynine Palms is one of the few communities in the region without a local sales tax. The current sales tax rate in Twentynine Palms is 7.75%, which consists of state, county, and special district taxes only.

Passing this measure keeps revenue local to maintain roads, support public safety, and improve local services.

What would funds raised by a possible sales tax measure go towards? Any funds raised by the potential ballot measure being explored would go to the City's General Fund to be used for Twentynine Palms city services and facilities, including:
• REPAIRING AND MAINTAINING city streets
• PROVIDING effective public safety, police officers, patrols, and rapid 911 response times • PREPARING the City for emergencies (including flooding, fire, earthquakes, and traffic accidents) • MAINTAINING parks, trails, and open spaces
• MAINTAINING animal control services and ensuring the animal shelter meets basic health and safety standards
What taxpayer protections would be included?
Taxpayer protections would be required by the measure. Any funds generated by the potential measure we're exploring would go to the City's General Fund to be used for Twentynine Palms city services and facilities. Any funds generated would stay locally controlled in the City of Twentynine Palms. The measure will require oversight, independent financial audits, and yearly reports to the community to ensure the funds are spent as promised.

If no decisions have been made yet, when will the important discussion and decisions happen? Currently, the City of Twentynine Palms is taking deliberate steps to reach out and LISTEN to our community. No final decisions have been made yet on this issue. The City is committed to full transparency, including proactively keeping our community informed throughout 2026.

Who makes the final decision?
The locally elected Twentynine Palms City Council is the legal entity that is responsible for taking action to place a city measure on the ballot. Ultimately, Twentynine Palms REGISTERED VOTERS will have the final say when they vote for or against the measure.

Where can I go for more information?
For more information, visit www.ci.twentynine-palms.ca.us or contact [email protected]

6136 Adobe Road
Twentynine Palms, CA 92277
Provided for your information only by the City of Twentynine Palms.

City of
Twentynine Palms
Stone James

CITY OF TWENTYNINE PALMS
May 2026
Dear City of Twentynine Palms Resident,
Thank you for your interest in the City of Twentynine Palms’ needs. Your feedback is essential in helping us serve you better, and protect our city’s quality of life.

Earlier, we asked you for your priorities for our City. Altogether, we received nearly 700 completed surveys with over 519 personal comments from community members. “29 provides amazing public services, quick responses to emergencies, beautiful open spaces, and essential local support.” — Kevin L.
“I’m now an eleven year resident of 29 Palms. I just wanted to say that finally I can get pretty much everything that I need to buy in 29 Palms.” — Randy R. “Overall the city is doing great. We’re proud to be residents and business owners.

Doing anything possible to minimize fees and red tape for small independent businesses trying to make 29 Palms a success are crucial to us.” — Blake H-K. “The city needs to look at improving the infrastructure to handle flooding and waste water.” — Anonymous
Thank you for your input. With the increased cost of providing essential services like street maintenance, flood prevention, and public safety, the City Council will soon make important decisions considering a modest local sales tax (1%) to support city services.

No decisions have been made yet. Ultimately, any measure that goes to the ballot will require taxpayer protections—and local voters will decide.

For more information, visit our website at www.ci.twentynine-palms.ca.us/LISTENS or email us at [email protected].

Thanks again — your opinions matter.

Sincerely,
Stone James, City Manager, City of Twentynine Palms

Thank you
for your input.

We received nearly 700 total responses from Twentynine Palms residents. As a City, our priorities moving forward include:

E REPAIRING & MAINTAINING city streets.

E PROVIDING effective public safety, police officers,
patrols, and rapid 911 response times.

E PREPARING the City for emergencies (including flooding, fire, earthquakes, and traffic accidents).

E MAINTAINING parks, trails, and open spaces.

E MAINTAINING animal control services and ensuring the
Paws n Palms animal shelter meets basic health and
safety standards.

We recently asked
about your priorities
regarding city services—
and you responded.

We are
Listening.

Our goal as a city is to continue
providing quality city services and
protecting local families.

Twentynine Palms is one of the few communities in the region without a local sales tax.

If approved, visitors and tourists would pay a large percentage of the proposed sales taxes to help fund our street maintenance, police, and other critical services—and would not apply to essentials local families rely on like groceries and prescription medications.

City Council Action:

E Tuesday, June 23, 6:00 PM
Twentynine Palms City Hall
6136 Adobe Road
Twentynine Palms, CA 92277
For more information,
SCAN this QR code, or visit our website.

You can also email us at:
[email protected]
www.ci.twentynine-palms.ca.us/LISTENS
Have any questions?
Possible Ballot
Question:
“Shall the measure funding the City
of Twentynine Palms services such
as maintaining 911 response times,
police officers and patrols, emergency
response, maintenance of streets,
parks and trails, upgrade the animal
shelter, and support general city
services; raising the sales tax by 1%
be adopted, providing approximately
$2,000,000 annually until ended
by voters; requiring audits/public
spending disclosure, all funds used
locally, be adopted?”
Taxpayer
Safeguards:

E Basic necessities, like groceries
and prescription medications,
will NOT be taxed.

E Any funds generated would
stay locally controlled in the
City of Twentynine Palms.

E Oversight, independent
financial audits, and yearly
reports to the community will
be required to ensure funds are
being spent as promised.