Upland City Council
October 9, 2023

Funding must be used to pay for expenses related to the following only:
• Business In-Arrears Rent/Mortgage
• New Business Signage
• Adaptive Marketing Strategies
• Security Shutters and Cameras
Eligible retail businesses must meet the following program eligibility requirements:
• Current City of Upland Business License(retail designation) • Current State of California Reseller's Permit
• 75%or more of gross sales from retail sale of merchandise • Have an established business that has been operating in Upland prior to January 31,2020. • Be independently owned with fewer than 5 employees(including the owner) • Be an existing Private For-Profit business located in the City of Upland's Historic Downtown Area • Be able to demonstrate financial need by providing banking and business financial statements • Complete 8-hours of marketing courses through Small Business Development Center(SBCD) The Micro-Retail Resiliency Loan Program will assist approximately 10 retail businesses located within the downtown area.

ENVIRONMENTAL DETERMINATION
The proposed Micro-Retail Resiliency Program has been determined to be Categorically Exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15301 of the CEQA Guidelines. This section pertains to existing facilities involving negligible or no expansion of existing or former use. The program only provides a grant up to $5,000 to existing retail businesses for rent/mortgage, signage, marketing strategies, security shutters and cameras.

FISCAL IMPACTS
American Rescue and Recovery Plan Act Fund 229 budget will be increased by$50,000 in project#16165 (Micro- Retail Resiliency Program). There will be no fiscal impact to the General Fund.

ALTERNATIVES
Provide alternative direction to staff.

CEQA: Determined to be Exempt pursuant to Section 15301 of the CEQA Guidelines.

City of Upland

MICRO-RETAIL RESILIENCY PROGRAM
Program Guidelines
Summary
The City of Upland's Micro-Retail Resiliency Program (Program")will provide funding up to$5,000 as a forgivable loan to micro-retailers in Downtown Upland demonstrating financial need to improve sales due to a loss of revenues stemming from the aftermath of the COVID-19 pandemic. Specifically, the program's goal is to assist local micro-retailers become more resilient by initiating new marketing strategies, installing new business signage, installing security shutters and cameras and/or becoming current on outstanding rents/mortgages. Applications will be accepted during a month-long open enrollment period.

Application Period
Applications will be accepted at City Hall's Development Services Department 460 N. Euclid Avenue, Upland, CA 91786 from Monday, November 13, 2023, at 8:00 AM to Wednesday December 13, 2023, at 6:00 PM;Applicants needing additional assistance can contact staff at(909)931-4267.Applications received after this due date will be considered late and not accepted.

All applications will be reviewed on a first come, first-served basis. After the initial 30-day application window is closed,eligible businesses will be notified to complete and submit supporting documentation as requested by staff.

Loan Information and Terms
Participants in the program will be eligible to receive one business loan up to $5,000. Use of loan funds will be preapproved by the City and must meet program goals. Loans will be forgiven after one year of the business remaining in continued operation in Downtown.

Approved businesses will be required to execute a Loan Agreement with the City. The program offers $5,000 as a 0%, one-year forgivable loan to Upland downtown micro-businesses.

Loan funds may be used for the following:

1. Business In-Arrears Rent/Mortgage

2. New Business Signage

3. Adaptive Marketing Strategies

4. Security Shutters and Cameras
Eligibility Requirements
To be eligible to participate the business must:

1. Have a current City of Upland Business License (retail designation)

2. Have a current State of California Reseller's Permit

3. Have 75% or more of gross sales come from retail sale of merchandise

City of Upland

MICRO-RETAIL RESILIENCY PROGRAM
Program Guidelines

4. Have an established business that has been operating in Upland prior to January 31, 2020.

5. Be independently owned with fewer than 5 employees (including the owner)

6. Be an existing Private For-Profit business located in the City of Upland's Historic Downtown

7. Be able to demonstrate financial need by providing banking and business financial statements

8. Take 8-hours of marketing Small Business Development Consulting (SBCD) course(s) Eligibility Checklist
Prior to applying, each applicant must meet the following conditions and be willing to provide supporting documentation to substantiate their claim for financial assistance:

1. Business is a commercial property located in the City of Upland's Historic Downtown

2. Business has an existing and current lease/mortgage at location of operation

3. Business has been in operation in the City of Upland since prior to January 31, 2020

4. Business has 5 or fewer employees, including owner

5. Business is a retail establishment

6. Business does not have any existing, non-resolved code violations as identified in a formal notice from the City of Upland

7. Business is in good standing with all federal and state agencies

REPORTING
Following the execution of a program agreement and disbursement of loan funds, recipients shall provide, on no less than a quarterly basis, the following:

1. A report and supporting documents demonstrating what loan funds were used for

2. A summary of business operational status

3. Profit and loss statements and balance sheets

RECORD KEEPING
The City of Upland shall maintain adequate records of services and payments made by this program in sufficient detail to demonstrate compliance with the policies and procedures of the program.

These records shall be retained for at least 5 years.

Participant's financial records are confidential regarding their use as public information; however, the information may be provided to another state, or federal agency if required to provide information.

REQUIRED DOCUMENTATION
All applicants seeking assistance in the program, must provide staff with all requested documents in a timely fashion and affirm to abide by all program requirements and/or staff recommendations, as a condition of funding. The City of Upland reserves the right to request additional documentation to confirm program eligibility. The following documentation must be provided to staff for your application to be deemed complete:

City of Upland

MICRO-RETAIL RESILIENCY PROGRAM
Program Guidelines

1. Financial Transparency—Applicants must provide most recent available tax year filing (2022).

2. Payroll Records — Applicant will need to provide payroll records documenting the number of employees working in the business.

3. Copy of current City of Upland Business License

4. Copy of executed lease agreement or mortgage statement for commercial space

5. Government issued photographic identification
o All business owners with a 20% or greater ownership interest must submit a copy of a current government issued photographic identification (examples include):
■ CA driver's license or identification card; U.S. passport, alien registration card; Applicants must submit the following completed documents, failure to submit complete and verifiable documents will result in the termination of the application:

1. W-9 Form

2. Signed Loan Agreement

3. Proof of SBDC course completion

AUTHORITY TO IMPLEMENT
The City of Upland City Council has approved these program guidelines as written above, allocating American Rescue Plan Act funds up to $50,000, as a means of assisting local micro-businesses in Downtown Upland become more resilient. Authority to implement and modify these program guidelines rest with the City Manager with the exception of modification to any federal or state requirements or regulations.

, trpl" CITY FUPLAND
"The City of Gracious Living"
Stafif(krctilt
C�tIFOB�S
DATE: October 9,2023
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:ROBERT D.DALQUEST,DEVELOPMENT SERVICES DIRECTOR SUBJECT: ACCEPT COMMUNITY PROJECT FUNDING(CPF)GRANT AWARDS FOR FISCAL YEAR 2022(AGUILAR)AND FISCAL YEAR 2023 (TORRES)
RECOMMENDED ACTION:

It is recommended that the City Council accept the Fiscal Year 22(Aguilar)Community Project Funding Grant award of$1 Million,and the Fiscal Year 23 (Tones)Community Project Funding Grant award of$750,000 and appropriate the funds.

GOAL STATEMENT
The proposed action supports the City's goal of improving public realm infrastructure in Historic Downtown Upland through focused efforts that revitalize and retain downtown as the urban center for residents and visitors to shop,dine, socialize,and enjoy the Downtown environment.

BACKGROUND
In 2021,Congress reinstated the process of earmarking for local governments and nonprofits after a decade-long ban, initiating the return of congressionally directed spending through a reformed process called "Community Project Funding"(CPF).

In mid-2021, the City applied for FY22 Community Project Funding Grant in the amount of $1 Million with Congressmember Pete Aguilar for the "Downtown Upland Main Street Economic Recovery and Revitalization Project." Staff received notification in February 2023 that the City received the grant,which included the award letter and grant agreement. All materials were completed and submitted to the U.S. Department of Housing and Urban Development(See Attachment).

In April 2022, the City applied for FY23 Community Project Funding Grant in the amount of $750,000 with Congressmember Norma Torres for Phase II of the "Downtown Upland Main Street Economic Recovery and Revitalization Project." In March 2023,notification was sent that the City received the grant and was accompanied by the award letter and grant agreement. All documents have been completed and only a detailed project description and budget is remaining to be submitted to the U.S. Department of Housing and Urban Development (See Attachment).

ISSUES AND ANALYSIS
Both grants are essential in funding permanent public realm improvements to revitalize commerce in Downtown Upland. The grants will assist in the design and construction of the Tom Thomas Magnolia Plaza, the Downtown Parklets Project,and narrowing Second Avenue and C Street intersection with bulb-outs to improve pedestrian safety and walkability. Collectively,these projects will result in revitalizing interest and expanding business opportunities and increase the economic conditions and sustainability in Downtown.

ENVIRONMENTAL DETERMINATION
Acceptance of the FY22 and FY23 Community Project Funding Grants is not considered a "project" under the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 13578. This action is an administrative activity of the City and will not directly or indirectly result in a physical change in the environment.

FISCAL IMPACTS
The Community Project Funding Grant awards projects will be reported in federal grant Fund(HUD)240 as follows:
$800,000 in Project#82338 (Tom Thomas Magnolia Plaza); $484,000 in Project#32337 (Downtown Parklets); and

$266,000 in Project#22201 (Second Avenue & C Street Improvement Project). With this action, the revenue and expenditures relating to the two grants will be added to the Fiscal Year 2023-24 Capital Improvement Project Budget.

ALTERNATIVES
Provide alternative direction to staff.

CEQA:Not a Project

U.S.DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
+ 1111111 x) WASHINGTON,D.C.20410-1000

IIIIIII

OFFICE OF COMMUNITY PLANNING AND DEVELOPMENT
March 7, 2023
Mr. Robert D. Dalquest
Development Services Director
City of Upland
, CA
Email: [email protected]
Dear Mr. Dalquest:

This letter provides important updates concerning your FY2022 Community Project Funding (CPF) award. The recently enacted Consolidated Appropriations Act, 2023, (P.L. 117- 328)1 (the FY2023 Act) includes changes for Fiscal Year 2022 CPF grants initially authorized in the Consolidated Appropriations Act, 2022(P.L. 117-103) (the FY2022 Act). Additionally, HUD has taken action and determined that all of its FY2022 CPF grants will not be subject to the Build America, Buy America(BABA)provisions.

To account for these changes and clarify the applicable requirements for your grant, HUD has revised its FY2022 CPF Grant Agreement and prepared a new"FY2022 Community Project Funding Grant Guide: Version 2.0"to replace the former grant guide.

This letter provides a brief overview of the changes and the process that FY2022 Community Project Funding grantees should take to fill out and sign the "Revised FY2022 CPF Grant Agreement". As a clarification, this letter applies only to your FY2022 CPF grant. If you have also been designated to receive a FY2023 CPF grant, HUD will provide a separate correspondence regarding that grant.

The FY2023 Act includes the following changes for FY2022 CPF grants:
1) Clarifies that eligible expenses include administrative, planning, operations, and maintenance costs;
2) Authorizes the grant funds to be used for reimbursement of otherwise eligible expenses incurred on or after the date of enactment of the FY 2022 Act, and prior to the date of grant execution, some exceptions may apply in accordance with 2 CFR 200.305.
3) Expenditures for planning and management development and administration are no longer capped at 20 percent of the grant amount.

The FY2023 Act language related to Congressionally-directed Economic Development Initiative/Community Project Funding is on pages 696-697: https://www.congress.gov/117/bills/hr2617BILLS-117hr2617enr.pdf .

In addition to this letter,we are providing an updated"Grant Award Package"that includes:
1) The updated"FY2022 Community Project Funding Grant Guide" (FY22 CPF Grant Guide: Version 2.0)which provides:
a. Information on the appropriations-specific and cross-cutting Federal requirements that govern these funds.
i. Award instructions that provide guidance for various grant administration-related actions. Please refer to this document as it includes important information and forms for accessing the Disaster Recovery Grant Reporting (DRGR) system which manages the reimbursement process and periodic reporting of project status and accomplishments. Links to the required forms are included in grant guide and on our website:
https://www.hud.gov/programoffices/comm_planning/edi-grants . 2) The Revised FY2022 CPF Grant Agreement which:
a. Specifies the applicable statutory provisions, regulations, and administrative requirements for this award.
b. Should be read carefully, including its incorporated appendices, which contain additional mandatory award terms as well as information specific to your award, such as your organization's indirect cost information. c. Should be reviewed to ensure all grantee information and award-specific information is entered completely and accurately before signing. d. Must be signed and dated by the Authorized Representative or the grantee's legal signatory.
e. Should also be retained for your records, after submission, pending receipt of the fully executed copy from HUD.

To assist you with understanding the materials that you have received,HUD will be hosting a series of regular webinars and "office hours" to review these changes and support grantees through the grant award process and beyond.

Overview of Changes from the FY2023 Act
To be eligible, expenses must comply with applicable Federal requirements. This includes administrative requirements under 2 CFR Part 200, environmental laws, statutes, and Executive Orders, and other"cross-cutting" federal requirements adhered to by HUD. In addition, environmental reviews are required for all HUD funded programs and project activities.

This includes soft costs as well as hard costs.

In keeping with the National Environmental Policy Act(NEPA) and HUD's NEPA- implementing regulations at 24 CFR Part 50 or 24 CFR Part 58, environmental reviews must be completed, and a Request for Release of Funds and Certification must be approved by

HUD, as applicable, for all projects prior to taking any `choice limiting actions.'2 Environmental reviews must be completed before a grantee can undertake actions that prevent the grantee from taking an alternative action to minimize or avoid environmental harm, or that would have an adverse environmental impact("choice limiting actions"). This step is required to avoid violations under:
• 24 CFR 58.22 which provides limitations on activities pending clearance; and • Section 110(k) of the National Historic Preservation Act which prohibits anticipatory demolition or significant harm of cultural and/or historic resources prior to completion of the historic preservation review process known as Section 106 review.

HUD defines the "Federal Nexus" for a program or project as the event that triggers the requirements for federal environmental review under a host of laws, regulations, and Executive Orders, including the prohibition on choice limiting actions.

Under the original process for the FY2022 EDUCPF grants, given that grantees were not aware of the federal requirements at enactment of the FY 2022 Act and that recipients could not be reimbursed for eligible expenses that occurred before obligation(interpreted to mean the execution of the grant agreement),HUD determined that the Letter of Invitation(LOI)would serve as notification of the federalization of the award.

HUD has determined the federalization date of FY2022 CPF grants as July 18-28, 2022. The exact date for federalization depends on the date of your LOI. This is also referred to as the federal `nexus' date for environmental review for CPF projects.To prevent choice limiting actions from occurring, following the LOI, you may not commit funds or take any actions (outside of existing contracts)until an environmental review is completed. Further explanation of choice limiting actions and the environmental review process, including historic preservation review, is included within the CPF Grant Guide.

Based on the FY2023 language changing the reimbursable expenses for HUD's FY2022 CPF grantees, HUD evaluated how to increase eligible project costs while ensuring adherence to all "eligibility"requirements. Given that the specific reference to "otherwise eligible expenses" within the FY2023 Act's language includes compliance with environmental requirements as paramount to project eligibility, the changes broaden costs reimbursement for the HUD CPF FY22 grantees:

1. For soft costs, HUD conducted a nationwide environmental review to clear activities such as administrative,planning, and operations and maintenance costs (including costs to prepare an environmental review). After your Grant Agreement is executed(and your approved budget is changed as necessary to account for these costs),you may use your grant funds to reimburse soft costs incurred on or after the date of enactment of the FY2022 Act (March 15, 2022).

2. For hard costs: After your Grant Agreement is executed(and your approved budget is changed, if necessary, to account for these costs),you may use your grant funds to reimburse hard costs that were incurred:
2 Choice limiting actions constitute work such as entering construction contract agreements/commitments and earth-moving activities/clearing/grubbing as well as building renovation/upgrades that can have an adverse impact on cultural and/or historic resources or the environment,or prevent the avoidance,minimization,or mitigation of those impacts.Examples of`choice limiting actions'include,but are not limited to,purchasing land,entering into contracts for property acquisition or construction, or physical work on the project.

a. after the environmental review process was completed; and b. after the date of the LOI.

Process Changes
1) Grantee has sent grant materials to HUD but does not yet have an executed Grant Agreement:

For grantees that have sent your grant materials to HUD but do not yet have an executed Grant Agreement,you have the option,but are not required,to revise your project narrative and budget to take advantage of the changes from the FY2023 Act.

See Section 2.2.1 of the Grant Guide for next steps.
2) Grantee has signed your grant agreement but do not yet have an executed Grant Agreement:

For grantees that have signed their Grant Agreement, but are waiting on the executed Grant Agreement from HUD, you will need to sign a revised Grant Agreement.

In addition, please note, you have the option,but are not required,to revise your project narrative and budget to take advantage of the changes from the FY2023 Act.

See Section 2.2.2 of the Grant Guide for next steps.
3) Grantee has not yet sent grant materials to HUD:

If you have not sent your grant materials to HUD, HUD will send the Grant Award Letter, Grant Agreement, FY2022 Grant Guide: Version 2.0, and standard forms to you.

See Section 2.2.3 of the Grant Guide for next steps.
4) FY2022 Grantees with Technical Corrections
The FY2023 Appropriations Act listed Technical Corrections to certain FY2022 EDI-CPF grants. Grantees with Technical Corrections have received a letter from HUD with guidance for next steps to incorporate the Technical Corrections.

See Section 2.2.4 of the Grant Guide for next steps.

All information required for your grant award should be submitted via email to the dedicated mailbox at [email protected]. Include your grant number and grant name in all email correspondence. In transmitting your information, please copy and paste the bolded information as the subject line of your email: : :

Submission of Required Grant Materials.

If you, or your staff, have any questions regarding how to complete your amended Grant Agreement or about your grant in general, please feel free to contact Njeri Santana-Carter, in the Congressional Grants Division at [email protected]. Please note while your Grant Officer may change over time, we have a team approach to managing your project. Njeri Santana-Carter is the primary point of contact at HUD for this award and will be available to assist you. An updated list of Grant Officers is posted on the program website and available at this link:
https://www.hud.gov/sites/dfiles/CPD/documents/Community-Proj ect-Funding-Portfolio- Assignments.pdf.

Sincerely,
Robin J. Keegan
Deputy Assistant Secretary for
Economic Development
ATTACHMENTS:

FY2022 Community Project Funding Grant Guide (Version 2.0) Revised FY2022 CPF Grant Agreement
Form HUD-1044-Assistance Award/Amendment Form

Assistance Award/Amendment U.S. Department of Housing and Urban Development
Office of Administration

1.Assistance Instrument 2.Type of Action
fI Cooperative Agreement X Grant I X I Award Amendment

3. Instrument Number 4.Amendment Number 5.Effective Date of this Action 6.Control Number B-22-CP-CA-0098

7.Name and Address of Recipient 8.HUD Administering Office City of Upland CPD,Congressional Grants Division 451 7th Street,SW,Rm 7146
Washington,DC 20410-7000
,CA
EIN: 95-6000805 —
8a.Name of Administrator 8b.Telephone Number
UEI: FLE5FE7EERMQ5

10.Recipient Project Manager 9.HUD Government Technical Representative Robert D.Dalquest Njeri Santana-Carter [email protected]

11.Assistance Arrangement 112.Payment Method 13.HUD Payment Office Cost Reimbursement Treasury Check Reimbursement Chief Financial Officier Cost Sharing Advance Check
X I Fixed Price I X I Automated Clearinghouse

14.Assistance Amount 15.HUD Accounting and Appropriation Data Previous HUD Amount 15a.Appropriation Number 15b.Reservation Number HUD Amount this Action $1,000,000.00 EDE 22 Total HUD Amount $1,000,000.00 Amount Previously Obligated Recipient Amount Obligation by this Action
Total Instrument Amount $1,000,000.00 Total Obligation

16. Description
Downtown Upland Main Street Economic Recovery and Revitalization Project This Award consists of the following items which are appended to and hereby made part of this Award:
(A)Cover Page-HUD 1044
(B)Grant Agreement
Instructions:

NO PROJECT FUNDS may be committed to the project or drawn down prior to environmental release of funds approval.

Locate your nearest HUD Regional Environmental Officer at hu p s:// www.hudexchange.info/programs/environmental-review/hud-environmental-staff=contacts/-reu ion-i-rei onal-and-field-environmental-officers.

Disclaimer:The information on this form is to be used only for purposes of recordkeeping and facilitating communication between the Recipient identified in box 7 above(which is also referred to as the"Grantee")and the U.S. Department of Housing and Urban Development("HUD")in relation to the award identified above("this award").

This document does NOT constitute the grant agreement for this award.

The terms and conditions for this award are as specified in the grant agreement signed by HUD and the Grantee

17. Recipient is required to sign and return three(3)copies of 18. x Recipient is not required to sign this document. this document to the HUD Administering Office. I

19.Recipient(By Name): 20.HUD(By Name):

Mr. Robert D.Dalquest Robin J. Keeoan
Previous Editions are Obsolete form HUD-1044(8/90) Ref.Handbook 2210.17

FY 2022 COMMUNITY PROJECT FUNDING
GRANT AGREEMENT NO. B-22-CP-CA-0098
Grantee Name: City of Upland
Grantee Address: , CA
Grantee's Unique Entity Identifier(UEI): FLE5FE7EERMQ5
Grantee's Employer Identification Number(EIN)95-6000805 Federal Award Identification Number(FAIN) B-22-CP-CA-0098 Assistance Listing Number and Name 14.251 Economic Development Initiative, Community Project Funding, and Miscellaneous Grants
Period of Performance/Budget Period Start Date Date of grant obligation Period of Performance/Budget Period End Date August 31,2030 This Grant Agreement between the Department of Housing and Urban Development(HUD) and City of Upland(the Grantee) is made pursuant to the authority of the Consolidated Appropriations Act, 2022 (Public Law 117-103); and the Explanatory Statement for Division L of that Act,which was printed in the House section of the Congressional Record on March 9,2022 (Explanatory Statement); and superseding provisions of the Consolidated Appropriations Act, 2023 (Public Law 117-328).

In reliance upon and in consideration of the mutual representations and obligations under this Grant Agreement,HUD and the Grantee agree as follows:

ARTICLE I. Definitions
The definitions at 2 CFR 200.1 apply to this Grant Agreement, except where this Grant Agreement specifically states otherwise.

Budget period is defined in 2 CFR 200.1 and begins and ends on the dates specified above for the Period of Performance/Budget Period Start Date and Period of Performance/Budget Period End Date.

Period of Performance is defined in 2 CFR 200.1 and begins and ends on the dates specified above for the Period of Performance/Budget Period Start Date and Period of Performance/Budget Period End Date.

ARTICLE II. Total Grant Amount
Subject to the provisions of the Grant Agreement,HUD will make grant funds in the amount of$1,000,000 available to the Grantee.

ARTICLE III. Award-Specific Requirements
A. Federal Award Description. The Grantee must use the Federal funds provided under this Grant Agreement(Grant Funds)to carry out the Grantee's "Project." Unless changed in accordance with Article III, section C of this Grant Agreement,the Grantee's Project shall be as described in the Project Narrative that is approved by HUD as of the date that HUD signs this Grant Agreement. For reference,HUD will attach this approved Project Narrative as Appendix 1 to the Grant Agreement on the date that HUD signs this Grant Agreement.

FY 2022 COMMUNITY PROJECT FUNDING
GRANT AGREEMENT NO.B-22-CP-CA-0098
B. Approved Budget. The Grantee must use the Grant Funds as provided by the Approved Budget. Unless changed in accordance with Article III, section C of this Grant Agreement,the Approved Budget shall be the line-item budget that is approved by HUD as of the date that HUD signs this Grant Agreement. For reference, HUD will attach this approved line-item budget as Appendix 2 to this Grant Agreement on the date that HUD signs this Grant Agreement.

C. Project and Budget Changes.All changes to the Grantee's Project or Approved Budget must be made in accordance with 2 CFR 200.308 and this Grant Agreement. To request HUD's approval for a change in the Project or Approved Budget,the Grantee must submit a formal letter to the Director of HUD's Office of Economic Development - Congressional Grants Division through the assigned Grant Officer. The letter must be submitted by email to the assigned Grant Officer and must provide justification for the change. The email submitting the letter must also include a revised project narrative or revised line-item budget, as applicable,that includes the requested change. The Grantee is prohibited from making project or budget changes that would conflict with the Applicable Appropriations Act Conditions described in Article III, section D of this Grant Agreement. The assigned Grant Officer for this grant is provided in the Award Letter for this grant and found on HUD's website. The HUD Office of Economic Development— Congressional Grants Division will notify the Grantee in writing,by email, whether HUD approves or disapproves the change. Before the Grantee expends Grant Funds in accordance with any change approved by HUD or otherwise allowed by 2 CFR 200.308,the Grantee must update its grant information in Disaster Recovery Grant Reporting(DRGR) to reflect that change.

D. Applicable Appropriations Act Conditions. The conditions that apply to the Grant Funds as provided by the Consolidated Appropriations Act, 2022,the Explanatory Statement, and the Consolidated Appropriations Act,2023 are hereby incorporated and made part of this Grant Agreement. In the event of a conflict between those conditions,the conditions provided by the later Act will govern. The Grant Funds are not subject to the Community Development Block Grants regulations at 24 CFR part 570 or Title I of the Housing and Community Development Act of 1974.

E. In accordance with 2 CFR 200.307(b),costs incidental to the generation of program income may be deducted from gross income to determine program income,provided these costs have not been charged to the grant. As authorized under 2 CFR 200.307(e)(2),program income may be treated as an addition to the Federal award,provided that the Grantee uses that income for allowable costs under this Grant Agreement. In accordance with 2 CFR 200.307(b), costs incidental to the generation of program income may be deducted from gross income to determine program income,provided these costs have not been charged to the grant. Any program income that cannot be expended on allowable costs under this Grant Agreement must be paid to HUD before closeout of the grant, unless otherwise specified by an applicable Federal statute.

FY 2022 COMMUNITY PROJECT FUNDING
GRANT AGREEMENT NO.B-22-CP-CA-0098
F. The Grantee must use the Grant Funds only for costs(including indirect costs)that meet the applicable requirements in 2 CFR part 200 (including appendices). The Grantee's indirect cost rate information is as provided in Appendix 3 to this Grant Agreement. Unless the Grantee is an Institution of Higher Education,the Grantee must immediately notify HUD upon any change in the Grantee's indirect cost rate during the Period of Performance, so that HUD can amend the Grant Agreement to reflect the change if necessary. Consistent with 2 CFR part 200,Appendix III (C.7), if the Grantee is an Institution of Higher Education and has a negotiated rate in effect on the date this Grant Agreement is signed by HUD,the Grantee may use only that rate for its indirect costs during the Period of Performance.

G. The Grantee must comply with any specific award conditions that HUD may attach to this Grant Agreement as provided by 2 CFR 200.208. If applicable,these conditions will be listed or added as Appendix 5 to this Grant Agreement.

H. The Grantee is responsible for managing the Project and ensuring the proper use of the Grant Funds. The Grantee is also responsible for ensuring the completion of the Project, the grant closeout, and compliance with all applicable federal requirements. The Grantee may subaward all or a portion of its funds to one or more subrecipients, as identified in the Project Narrative(Appendix 1)or as may be approved by HUD in accordance with 2 CFR 200.308.

All subawards made with funding under this Grant Agreement are subject to the subaward requirements under 2 CFR art 200, including 2 CFR 200.332, and other requirements provided by this Grant Agreement. The Grantee is responsible for ensuring each subrecipient complies with all requirements under this Grant Agreement, including the general federal requirements in Article IV. A subaward may be made to a for-profit entity only if HUD expressly approves that subaward, and the for-profit entity is made subject to the same Federal requirements that apply to all other subrecipients, including the requirements 2 CFR part 200 provides for a"non-Federal entity"that receives a subaward.

ARTICLE IV. General Federal Requirements
A. If the Grantee is a unit of general local government, a State, an Indian Tribe,or an Alaskan Native Village,the Grantee is the Responsible Entity(as defined in 24 CFR part 58) and agrees to assume all of the responsibilities for environmental review and decision- making and action, as specified and required in regulations issued by the Secretary pursuant to section 305(c) of the Multifamily Housing Property Disposition Reform Act of 1994 and published in 24 CFR art 58.

B. If the Grantee is a housing authority, redevelopment agency, academic institution, hospital or other non-profit organization,the Grantee shall request the unit of general local government, Indian Tribe or Alaskan Native Village,within which the Project is located and which exercises land use responsibility,to act as Responsible Entity and assume all of the responsibilities for environmental review and decision-making and action as specified in paragraph A above, and the Grantee shall carry out all of the responsibilities of a grantee under 24 CFR art 58.

FY 2022 COMMUNITY PROJECT FUNDING
GRANT AGREEMENT NO.B-22-CP-CA-0098
C.After Grantee's receipt of the Letter of Invitation for this grant, neither the Grantee nor any of its contractors, subrecipients and other funding and development partners may undertake, or commit or expend Grant Funds or local funds for,project activities (other than for planning, management,development and administration activities), unless a contract requiring those activities was already executed prior to the Letter of Invitation,until one of the following occurs:
(i)the Responsible Entity has completed the environmental review procedures required by 24 CFR part 58,and HUD has approved the environmental certification and given a release of funds; (ii)the Responsible Entity has determined and documented in its environmental review record that the activities are exempt under 24 CFR 58.34 or are categorically excluded and not subject to compliance with environmental laws under 24 CFR 58.35(b); or(iii)HUD has performed an environmental review under 24 CFR part 50 and has notified Grantee in writing of environmental approval of the activities.

D. Following completion of the environmental review process, the Grantee (recipient) shall exercise oversight, monitoring, and enforcement as necessary to assure that decisions and mitigation measures adopted through the environmental review process are carried out during project development and implementation.

E. The Grantee must comply with the generally applicable HUD and CPD requirements in 24 CFR part 5, subpart A, including all applicable fair housing, and civil rights requirements.

If the Grantee is a Tribe or a Tribally Designated Housing Entity (TDHE) as established under 24 CFR 1000.206,the Grantee must comply with the nondiscrimination requirements in 24 CFR 1000.12 in lieu of the nondiscrimination requirements in 24 CFR 5.105(a). The Grantee must report data on the race,color, religion, sex,national origin, age, disability,and family characteristics of persons and households who are applicants for,participants in, or beneficiaries or potential beneficiaries of the Grantee's Project, consistent with the instructions and forms provided by HUD in order to carry out its responsibilities under the Fair Housing Act,Executive Order 11063, Title VI of the Civil Rights Act of 1964, and Section 562 of the Housing and Community Development Act of 1987 (e.g. HUD-27061).

F. The Grantee must comply with the Uniform Administrative Requirements, Cost Principles, and Audit Requirements in 2 CFR part 200, as may be amended from time to time. If 2 CFR part 200 is amended to replace or renumber sections of part 200 that are cited specifically in this Grant Agreement,the part 200 requirements as renumbered or replaced by the amendments will govern the obligations of HUD and the Grantee after those amendment become effective.

G. The Grantee must comply with the Award Term in Appendix A to 2 CFR part 25 ("System for Award Management and Universal Identifier Requirements") and the Award Term in Appendix A to 2 CFR part 170("Reporting Subawards and Executive Compensation"),which are hereby incorporated into and made part of this Grant Agreement.

H. If the Total Grant Amount, as provided in Article II of this Grant Agreement, is greater than$500,000,the Grantee must comply with the Award Term and Condition for Grantee Integrity and Performance Matters in Appendix 4 to this Grant Agreement.

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I. Unless the Grantee is exempt from the Byrd Amendment as explained below,the Grantee must comply with the provisions of Section 319 of Public Law 101-121, 31 U.S.C. 1352, (the Byrd Amendment)and 24 CFR part 87,which prohibit recipients of Federal contracts, grants, or loans from using appropriated funds for lobbying the executive or legislative branches of the Federal Government in connection with a specific contract, grant, loan, or cooperative agreement. The Grantee must include in its award documents for all sub-awards at all tiers (including subcontracts, subgrants, and contracts under grants, loans, and cooperative agreements),the requirements for the certification required by Appendix A to 24 CFR part 87 and for disclosure using Standard Form-LLL (SF-LLL),"Disclosure of Lobbying Activities." In addition,the Grantee must obtain the executed certification required by Appendix A and an SF-LLL from all covered persons. "Person" is as defined by 24 CFR part 87. Federally recognized Indian tribes and TDHEs established by Federally recognized Indian tribes as a result of the exercise of the tribe's sovereign power are excluded from coverage of the Byrd Amendment. State-recognized Indian tribes and TDHEs established only under state law must comply with this requirement.

J. The Grantee must comply with drug-free workplace requirements in Subpart B of 2 CFR part 2429,which adopts the governmentwide implementation (2 CFR part 182)of sections 5152-5158 of the Drug-Free Workplace Act of 1988,Pub.L. 100-690,Title V, Subtitle D (41 U.S.C. 701-707).

K. The Grantee must comply with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA) as implemented by regulations at 49 CFR part 24. The URA applies to acquisitions of real property and relocation occurring as a direct result of the acquisition,rehabilitation, or demolition of real property for Federal or Federally funded programs or projects.Real property acquisition that receives Federal financial assistance for a program or project,as defined in 49 CFR 24.2,must comply with the acquisition requirements contained in 49 CFR part 24, subpart B. Unless otherwise specified in law, the relocation requirements of the URA and its implementing regulations at 49 CFR part 24, cover any displaced person who moves from real property or moves personal property from real property as a direct result of acquisition, rehabilitation, or demolition for a program or project receiving HUD financial assistance
L. If Grant Funds are used for purchase, lease, support services, operation, or work that may disturb painted surfaces, of pre-1978 housing,you must comply with the lead-based paint evaluation and hazard reduction requirements of HUD's lead-based paint rules (Lead Disclosure; and Lead Safe Housing (24 CFR part 35)), and EPA's lead-based paint rules(e.g.,Repair, Renovation and Painting;Pre-Renovation Education; and Lead Training and Certification(40 CFR part 745)).

M. The Grantee must comply with Section 3 of the Housing and Urban Development Act of 1968 (Section 3), 12 U.S.C. 1701u, and HUD's regulations at 24 CFR part 75, as applicable, including the reporting requirements in 24 CFR 75.25. Grants made to Tribes and TDHEs are subject to Indian Preference requirements in Section 7(b) of the Indian Self- Determination and Education Assistance Act(25 U.S.C. 5307(b)).As stated in 24 CFR 75.3(c), grants to Tribes and TDHEs are subject to Indian Preference requirements in lieu of Section 3.

Grantees that are not exempt from Section 3 must submit annual reports of Section 3

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accomplishment Performance Measures in DRGR in January of the calendar year. This report reflects Section 3 accomplishments for the previous calendar year.

N. The Grantee must not use any Grant Funds to support any Federal, state, or local project that seeks to use the power of eminent domain, unless eminent domain is employed only for a public use. Public use includes use of funds for mass transit,railroad, airport, seaport, or highway projects, and utility projects which benefit or serve the general public (including energy-related, communication-related,water-related, and waste water-related infrastructure), other structures designated for use by the general public or with other common-carrier or public- utility functions that serve the general public and are subject to regulation and oversight by the government, and projects for the removal of an immediate threat to public health and safety or brownfields, as defined in the Small Business Liability Relief and Brownfields Revitalization Act(Pub. L. 107-118).Public use does not include economic development that primarily benefits private entities.

O. The Grantee must not use any Grant Funds to maintain or establish a computer network that does not block the viewing, downloading, and exchanging of pornography. This requirement does not limit the use of funds necessary for any Federal, State,tribal, or local law enforcement agency or any other entity carrying out criminal investigations,pro secution, or adjudication activities.

P. The Grantee must administer its Grant Funds in accordance with the Conflict of Interest requirements set forth in Appendix 6 of this Grant Agreement.

Q. The Grantee must comply with the governmentwide debarment and suspension requirements in 2 CFR part 180 as incorporated and supplemented by HUD's regulations at 2 CFR part 2424.

R. The Grantee must comply with the award term and condition regarding trafficking in persons in Appendix 7 of this Grant Agreement.

S. The assurances and certifications the Grantee has made and submitted to HUD are incorporated by this reference and made part of this Grant Agreement.

ARTICLE V.Drawdown Requirements
A. The Grantee may not draw down Grant Funds until HUD has received and approved any certifications and disclosures required by 24 CFR 87.100 concerning lobbying, if applicable.

B. The Grantee must use HUD's Disaster Recovery Grant Reporting(DRGR) system to draw down Grant Funds and report to HUD on activities.

C. The Grantee must enter activity and budget information in DRGR that is consistent with the Project and Approved Budget as described in Article III, sections A and B of this Grant Agreement and complies with HUD's instructions for entering information in DRGR found in

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the document titled"Grant Award Instructions"that accompanies the Grant Agreement.

The Grantee must only enter activities in DRGR that are described in the Approved Budget.

D. The Grantee must expend all Grant Funds in accordance with the activity and budget information in DRGR.

E. Each drawdown of Grant Funds constitutes a representation by the Grantee that the funds will be used in accordance with this Grant Agreement.

F. The Grantee must use DRGR to track the use of program income and must report the receipt and use of program income in the reports the Grantee submits to HUD under Article VI of this Grant Agreement. The Grantee must expend program income before drawing down Grant Funds through DRGR.

G. Notwithstanding any other provision of this grant agreement,HUD will not be responsible for payment of any Grant Funds after the date Treasury closes the account in accordance with 31 U.S.C. § 1552.Because Treasury may close the account up to one week before the September 30 date specified by 31 U.S.C. § 1552,the grantee is advised to make its final request for payment under the grant no later than September 15,2030.

ARTICLE VI.Program-Specific Reporting Requirements
In addition to the general reporting requirements that apply under other provisions of this Agreement,the following program-specific reporting requirements apply to the Grantee:

A. The Grantee must submit a performance report in DRGR on a semi-annual basis and must include a completed Federal financial report as an attachment to each performance report in DRGR. Performance reports shall consist of a narrative of work accomplished during the reporting period. During the Period of Performance,the Grantee must submit these reports in DRGR no later than 30 calendar days after the end of the 6- month reporting period. The first of these reporting periods begins on the first of January or June(whichever occurs first) after the date this Grant Agreement is signed by HUD.

B. The performance report must contain the information required for reporting program performance under 2 CFR 200.329(c)(2) and(d), including a comparison of actual accomplishments to the objectives of the Project as described in Article III, section A of this Grant Agreement;the reasons why established goals were not met, if appropriate; and additional pertinent information including,when appropriate, analysis and explanation of cost overruns or high unit costs.

C. Financial reports must be submitted using DRGR or such future collections HUD may require and as approved by OMB and listed on the Grants.gov website (ht ps:// www.grants.gov/web/grants/forms/post-award-reporting-forms.html) .

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D. The performance and financial reports will undergo review and approval by HUD. If a report submission is insufficient,HUD will reject the report in DRGR and identify the corrections the Grantee must make.

E. No drawdown of funds will be allowed through DRGR while the Grantee has an overdue performance or financial report.

F. The Grantee must report and account for all property acquired or improved with Grant Funds as provided by 2 CFR part 200 using the applicable common forms approved by OMB and provided on the Grants.gov website
( https://www.crants.gov/web/grants/forms/post-award-reporting-forms.html) . This reporting obligation includes submitting status reports on real property at least annually as provided by 2 CFR 200.330, accounting for real and personal property acquired or improved with Grant Funds as part of Project Closeout, and promptly submitting requests for disposition instructions as provided by 2 CFR 200.311(c), 200.313(e), and 200.314(a).

ARTICLE VII.Project Closeout
A. The grant will be closed out in accordance with 2 CFR part 200, as may be amended from time to time, except as otherwise specified in this Grant Agreement.

B. The Grantee must submit to HUD a written request to closeout the grant no later than 30 calendar days after the Grantee has drawn down all Grant Funds and completed the Project as described in Article III, section A of this Grant Agreement.

HUD will then send the Closeout Agreement and Closeout Certification to the Grantee.

C.At HUD's option,the Grantee may delay initiation of project closeout until the resolution of any findings as a result of the review of semi-annual activity reports in DRGR. If HUD exercises this option,the Grantee must promptly resolve the findings.

D. The Grantee recognizes that the closeout process may entail a review by HUD to determine compliance with the Grant Agreement by the Grantee and all participating parties. The Grantee agrees to cooperate with any HUD review, including reasonable requests for on-site inspection of property acquired or improved with Grant Funds.E. No

1. A Certification of Project Completion.

2. A Grant Closeout Agreement.

3. A final financial report giving the amount and types of project costs charged to the grant(that meet the allowability and allocability requirements of 2 CFR part 200, subpart E); a certification of the costs; and the amounts and sources of other project funds.

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4. A final performance report providing a comparison of actual accomplishments with the objectives of the Project as described in Article III, section A of this Grant Agreement,the reasons for slippage if established objectives were not met and additional pertinent information including explanation of significant cost overruns.

5. A final property report, if specifically requested by HUD at the time of closeout.

ARTICLE VIII. Default
A default under this Grant Agreement shall consist of any use of Grant Funds for a purpose other than as authorized by this Grant Agreement, any noncompliance with statutory, regulatory,or other requirements applicable to the Grant Funds, any other material breach of this Grant Agreement, or any material misrepresentation in the Grantee's submissions to HUD in anticipation of this award. If the Grantee fails to comply with the terms and conditions of the Grant Agreement,HUD may adjust specific conditions of this Grant Agreement as described in 2 CFR part 200,as may be amended from time to time. If HUD determines that noncompliance cannot be remedied by imposing additional conditions,HUD may take one or more of the remedies for noncompliance described in 2 CFR part 200, as may be amended from time to time.

HUD may also terminate all or a part of this award as provided by 2 CFR 200.340 and other applicable provisions of 2 CFR part 200, as may be amended from time to time. Nothing in this Grant Agreement shall be construed as creating or justifying any claim against the Federal government or the Grantee by any third party.

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ARTICLE IX. HUD Contact Information
Except where this Grant Agreement specifically states otherwise, all requests, submissions, and reports the Grantee is required to make to HUD under this Grant Agreement must be made in writing via email to [email protected].

This agreement is hereby executed on behalf of the Grantee and HUD as follows:

GRANTEE
Ci1 \ of VOA Ind
(Name of Organization)
BY: 1235111). �/✓
(Signature of Authorize fficial)
jl D- 170i1 U�s�- + lopmw-ii Sees VlYe-cfoY. (Typed Name and Thle of Authorized Official)
(Date)
HUD
BY:

Robin J.Keegan,
Deputy Assistant Secretary for Economic Development
(Date)

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APPENDIX 1—Project Narrative

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APPENDIX 2—Approved Budget

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APPENDIX 3—Grantee's Indirect Cost Rate Information
Subject to the applicable requirements in 2 CFR part 200(including its appendices), the Grantee will use an indirect cost rate as represented by the Grantee below:
? The Grantee will not use an indirect cost rate to charge its indirect costs to the grant.
? The Grantee will use the indirect cost rate(s) identified in the table below to charge its indirect costs to the grant.

Agency/Dept./Major Function Indirect cost rate Direct Cost Base [PLEASE NOTE: The grantee must check one of the two boxes above. If the second box is checked,the corresponding table must be filled out as described below.

The table must include each indirect cost rate that will be used to calculate the Grantee's indirect costs under the grant. The table must also specify the type of direct cost base to which each included rate applies(for example,Modified Total Direct Costs (MTDC)). Do not include indirect cost rate information for subrecipients.

For government entities, enter each agency or department that will carry out activities under the grant,the indirect cost rate applicable to each department/agency (including if the de minimis rate is used per 2 CFR 200.414), and the type of direct cost base to which the rate will be applied.

For nonprofit organizations that use the Simplified Allocation Method for indirect costs or elects to use the de minimis rate of 10%of Modified Total Direct Costs in accordance with 2 CFR 200.414,enter the applicable indirect cost rate and type of direct cost base in the first row of the table.

For nonprofit organizations that use the Multiple Allocation Base Method, enter each major function of the organization for which a rate was developed and will be used under the grant,the indirect cost rate applicable to that major function, and the type of direct cost base to which the rate will be applied.]

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APPENDIX 4—
Award Term and Condition for Grantee Integrity and Performance Matters Reporting of Matters Related to Grantee Integrity and Performance

1. General Reporting Requirement
If the total value of the Grantee's currently active grants, cooperative agreements, and procurement contracts from all Federal awarding agencies exceeds $10,000,000 for any period of time during the period of performance of this Federal award,then during that period of time the Grantee must maintain the currency of information reported to the System for Award Management(SAM)that is made available in the designated integrity and performance system (currently the Federal Awardee Performance and Integrity Information System (FAPIIS))about civil, criminal, or administrative proceedings described in paragraph 2 of this award term and condition. This is a statutory requirement under section 872 of Public Law 110-417, as amended (41 U.S.C. 2313). As required by section 3010 of Public Law 111-212, all information posted in the designated integrity and performance system on or after April 15,2011, except past performance reviews required for Federal procurement contracts, will be publicly avail able.

2. Proceedings About Which Grantee Must Report
During any period of time when the Grantee is subject to the requirement in paragraph 1 of this award term and condition,the Grantee must submit the information required about each proceeding that:
a. Is in connection with the award or performance of a grant, cooperative agreement, or procurement contract from the Federal Government;
b.Reached its final disposition during the most recent five-year period; and c. Is one of the following:
(1)A criminal proceeding that resulted in a conviction, as defined in paragraph 5 of this award term and condition;
(2)A civil proceeding that resulted in a finding of fault and liability and payment of a monetary fine,penalty,reimbursement,restitution, or damages of$5,000 or more; (3)An administrative proceeding,as defined in paragraph 5. of this award term and condition,that resulted in a fmding of fault and liability and the Grantee's payment of either a monetary fine or penalty of$5,000 or more or reimbursement,restitution, or damages in excess of$100,000; or
(4)Any other criminal, civil,or administrative proceeding if:
(i) It could have led to an outcome described in paragraph 2.c.(1), (2), or(3) of this award term and condition;

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(ii)It had a different disposition arrived at by consent or compromise with an acknowledgment of fault on the Grantee's part; and
(iii)The requirement in this award term and condition to disclose information about the proceeding does not conflict with applicable laws and regulations.

3. Reporting Procedures
During any period of time when the Grantee is subject to the requirement in paragraph 1 of this award term and condition,the Grantee must enter in the SAM Entity Management area the information that SAM requires about each proceeding described in paragraph 2 of this award term and condition. The Grantee does not need to submit the information a second time under assistance awards that the Grantee received if the Grantee already provided the information through SAM because the Grantee was required to do so under Federal procurement contracts that the Grantee was awarded.

4. Reporting Frequency
During any period of time when the Grantee is subject to the requirement in paragraph 1 of this award term and condition,the Grantee must report proceedings information through SAM for the most recent five-year period, either to report new information about any proceeding(s)that the Grantee has not reported previously or affirm that there is no new information to report. If the Grantee has Federal contract, grant, and cooperative agreement awards with a cumulative total value greater than $10,000,000,the Grantee must disclose semiannually any information about the criminal, civil, and administrative proceedings.

5. Definitions
For purposes of this award term and condition:
a.Administrative proceeding means a non judicial process that is adjudicatory in nature in order to make a determination of fault or liability (e.g., Securities and Exchange Commission Administrative proceedings, Civilian Board of Contract Appeals proceedings, and Armed Services Board of Contract Appeals proceedings). This includes proceedings at the Federal and State level but only in connection with performance of a Federal contract or grant. It does not include audits, site visits, corrective plans, or inspection of deliverables. b. Conviction, for purposes of this award term and condition,means a judgment or conviction of a criminal offense by any court of competent jurisdiction,whether entered upon a verdict or a plea, and includes a conviction entered upon a plea of nolo contendere. c. Total value of currently active grants, cooperative agreements,and procurement contracts includes—
(1) Only the Federal share of the funding under any Federal award with a cost share or match requirement; and
(2) The value of all expected funding increments under a Federal award and options, even if not yet exercised.

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APPENDIX 5—Specific Award Conditions
NONE.

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APPENDIX 6—Conflict of Interest Requirements

1. Conflicts Subject to Procurement Regulations. When procuring property or services, the grantee and its subrecipients shall comply with the applicable conflict-of-interest rules in 2 CFR 200.317 and 2 CFR 200.318(c). In all cases not governed by 2 CFR 200.317 and 2 CFR 200.318(c),the Grantee and its subrecipients must follow the requirements contained in paragraphs 2-5 below.

2. General prohibition.No person who is an employee, agent, consultant, officer, or elected or appointed official of the Grantee or subrecipient and who exercises or has exercised any functions or responsibilities with respect to assisted activities, or who is in a position to participate in a decision making process or gain inside information with regard to such activities, may obtain a financial interest or benefit from the activity,or have a financial interest i n any contract, subcontract, or agreement with respect thereto, or the proceeds thereunder, either for himself or herself or for those with whom he or she has immediate family or business ties, during his or her tenure or for one year thereafter. Immediate family ties include (whether by blood, marriage or adoption)the spouse,parent(including a stepparent), child (including a stepchild), sibling (including a stepsibling), grandparent,grandchild,and in-laws of a covered person.

3.Exceptions. HUD may grant an exception to the general prohibition in paragraph(ii) upon the Grantee's written request and satisfaction of the threshold requirements in paragraph (iv), if HUD determines the exception will further the Federal purpose of the award and the effective and efficient administration of the Grantee's project,taking into account the cumulative effects of the factors in paragraph(v).

4. Threshold requirements for exceptions. HUD will consider an exception only after the Grantee has provided the following documentation:
a. A disclosure of the nature of the conflict, accompanied by an assurance that there has been public disclosure of the conflict and a description of how that disclosure was made; and
b. An opinion of the Grantee's attorney that the interest for which the exception is sought would not violate state or local law.

5.Factors to be considered for exceptions. In determining whether to grant a requested exception after the Grantee has satisfactorily met the threshold requirements in paragraph(iii),HUD will consider the cumulative effect of the following factors,where applicable:
a. Whether the exception would provide a significant cost benefit or an essential degree of expertise to the program or project that would otherwise not be available; b. Whether an opportunity was provided for open competitive bidding or negotiation; c. Whether the person affected is a member of a group or class of low- or moderate- income persons intended to be the beneficiaries of the assisted activity,and the exception

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will permit such person to receive generally the same interests or benefits as are being made available or provided to the group or class;
d. Whether the affected person has withdrawn from his or her functions or responsibilities, or the decision-making process regarding the assisted activity in question; e. Whether the interest or benefit was present before the affected person was in a position as described in paragraph(ii);
f Whether undue hardship will result either to the Grantee or the person affected when weighed against the public interest served by avoiding the prohibited conflict; and g. Any other relevant considerations.

6. Disclosure of potential conflicts of interest. The Grantee must disclose in writing to HUD any potential conflict of interest.

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APPENDIX 7—Award Term and Condition Regarding Trafficking in Persons The following award term and condition,which is required by 2 CFR part 175, applies as written:
a. Provisions applicable to a grantee that is a private entity.

1.You as the grantee,your employees, subrecipients under this award, and subrecipients'employees may not—
i. Engage in severe forms of trafficking in persons during the period of time that the award is in effect;
ii. Procure a commercial sex act during the period of time that the award is in effect; or
iii. Use forced labor in the performance of the award or subawards under the award.

2.We as the Federal awarding agency may unilaterally terminate this award, without penalty, if you or a subrecipient that is a private entity:
i. Is determined to have violated a prohibition in paragraph a.1 of this award term; or
ii. Has an employee who is determined by the agency official authorized to terminate the award to have violated a prohibition in paragraph a.1 of this award term through conduct that is either—
A. Associated with performance under this award; or
B. Imputed to you or the subrecipient using the standards and due process for imputing the conduct of an individual to an organization that are provided in 2 CFR Part 180, "OMB Guidelines to Agencies on Governmentwide Debarment and Suspension(Nonprocurement),"as implemented by HUD at 2 CFR 2424.
b. Provision applicable to a grantee other than a private entity.

We as the Federal awarding agency may unilaterally terminate this award,without penalty, if a subrecipient that is a private entity-

1. Is determined to have violated an applicable prohibition in paragraph a.1 of this award term; or

2. Has an employee who is determined by the agency official authorized to terminate the award to have violated an applicable prohibition in paragraph a.1 of this award term through conduct that is either:

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i. Associated with performance under this award; or
ii. Imputed to the subrecipient using the standards and due process for imputing the conduct of an individual to an organization that are provided in 2 CFR part 180, "OMB Guidelines to Agencies on Governmentwide Debarment and Suspension(Nonprocurement),"as implemented by HUD at 2 CFR 2424. c. Provisions applicable to any grantee.

1. You must inform us immediately of any information you receive from any source alleging a violation of a prohibition in paragraph a.1 of this award term.

2. Our right to terminate unilaterally that is described in paragraph a.2 or b of this section:
i. Implements section 106(g) of the Trafficking Victims Protection Act of 2000 (TVPA),as amended(22 U.S.C. 7104(g)), and
ii.Is in addition to all other remedies for noncompliance that are available to us under this award.

3. You must include the requirements of paragraph a.1 of this award term in any subaward you make to a private entity.
d. Definitions. For purposes of this award term:

1."Employee"means either:
i.An individual employed by you or a subrecipient who is engaged in the performance of the project or program under this award; or ii. Another person engaged in the performance of the project or program under this award and not compensated by you including,but not limited to, a volunteer or individual whose services are contributed by a third party as an in-kind contribution toward cost sharing or matching requirements.

2. "Forced labor"means labor obtained by any of the following methods: the recruitment, harboring,transportation,provision,or obtaining of a person for labor or services,through the use of force, fraud, or coercion for the purpose of subjection to involuntary servitude,peonage, debt bondage,or slavery.

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3. "Private entity":
i.Means any entity other than a State, local government, Indian tribe, or foreign public entity,as those terms are defined in 2 CFR 175.25. ii. Includes:

A.A nonprofit organization, including any nonprofit institution of higher education,hospital, or tribal organization other than one included in the definition of Indian tribe at 2 CFR 175.25(b).

B. A for-profit organization.

4. "Severe forms of trafficking in persons," "commercial sex act,"and"coercion" have the meanings given at section 103 of the TVPA, as amended(22 U.S.C. 7102).

Ptyenr�� U.S.DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT iLn
w F WASHINGTON,D.C.20410-1000
9�DEN Ev

OFFICE OF COMMUNITY PLANNING AND DEVELOPMENT
March 2,2023
Robert D. Dalquest
City of Upland
460 N. Euclid Ave.

Upland, CA 91786
Email: [email protected]
Dear Dalquest:

In the Consolidated Appropriations Act, 2023 (Public Law 117-328) (the FY2023 Act), Congress made funding available $2,982,285,641 for"grants for the Economic Development Initiative (EDI) for the purposes, and in amounts, specified for Community Project Funding/Congressionally Directed Spending"in the associated table included in the accompanying joint explanatory statement(JES). These "Community Project Funding" or"CPF" awards are administered by the Department of Housing and Urban Development(HUD).

HUD received the below information about your project as listed on the JES,which was printed in the Senate section of the Congressional Record on December 20, 2022 (CREC-2022- 12-20-pt3-PgS9325-2.pdf(congress.gov)). A Grant Number(noted below) has been generated by HUD and will be the unique identifier for your project throughout the grant process.

Grantee: City of Upland
Project: Downtown Main Street Economic Recovery and Revitalization Project-Phase 2 Amount: $750,000
Grant Number B-23-CP-CA-0243
Pursuant to the requirements associated with the FY2023 Act, this FY2023 Grant Award Letter outlines initial grant award requirements and information needed from you to prepare your FY2023 CPF Grant Agreement for execution. The Grant Award Letter also provides an overview of the steps to execute your Grant Agreement. Further detail is provided within the FY2023 CPF Grant Guide.

This "Grant Award Letter,"is included in the"Grant Award Package"transmitted with the corresponding email. The Grant Award Package also includes:
• the "FY2023 Community Project Funding Grant Guide" (FY2023 CPF Grant Guide), • your FY2023 Community Project Funding Grant Agreement"FY2023 CPF Grant

• Agreement," and
• standard forms required to execute your Grant Agreement.

A brief overview of these documents is below:
1) FY2023 CPF Grant Guide: The FY2023 CPF Grant Guide provides instructions for completing the requested information and filling out the required administrative forms to initiate your FY2023 CPF Grant Agreement. The FY2023 CPF Grant Guide also provides information on the requirements that will govern these funds, as provided by the FY2023 Act, and the cross-cutting requirements that generally apply to all HUD awards as provided by HUD regulations and other applicable Federal regulations and statutes.

The FY2023 CPF Grant Guide provides guidance and instructions for access to your grant funds and fulfilling the reporting requirements for this award. The FY2023 CPF Grant Guide provides guidance for various grant administration-related actions including the Disaster Recovery Grants Reporting (DRGR) system for the financial management of these grant funds and periodic reporting of project status and accomplishments for this grant. Please refer to this document as it includes important information and forms for accessing DRGR, as well as other information concerning reporting requirements. 2) FY2023 CPF Grant Agreement for this Award: The FY2023 CPF Grant Agreement specifies the applicable statutory provisions, regulations, and administrative requirements for this award. Please read this FY2023 CPF Grant Agreement carefully, including its incorporated appendices, which contain additional mandatory award terms as well as information specific to your award, such as your organization's indirect cost information.

Please make sure all grantee information and award-specific information is entered completely and accurately before signing this Agreement. The grantee's Authorized Representative, or legal signatory,must sign and date the FY2023 CPF Grant Agreement.

Please retain a"copy" (either electronic and/or printed) of the signed and dated document for your records pending receipt of the countersigned copy from HUD. Please also note that to ensure the Project Narrative and Approved Budget(Appendices 1 and 2) reflect the project and budget as approved by HUD at the time of grant execution, Appendices 1 and 2 will be added by HUD on the date that HUD signs the FY2023 CPF Grant Agreement as stated in Article III, sections A and B of the FY2023 CPF Grant Agreement.
3) Standard Forms and Required Materials:
a. Form HUD-1044, Assistance Award/Amendment Form(Attached) b. Standard Form-424 Application for Federal Assistance:
https://www.hudexchange.info/resource/306/hud-form-sf424/ c. SF-424-B, Assurances for Non construction Programs, or SF-424-D, Assurances for Construction Programs: https://www.grants.gov/forms/sf-424-family.html d. SFLLL Disclosure of Lobbying Activities(as applicable):
https://www.hudexchange.info/resource/308/hud-form-sfl11/ e. SF-1199A- Direct Deposit Sign-Up Form:
https://www.hud.gov/sites/documents/attachmentvisf-1199A.PDF

Evidence of the American Bankers Association(ABA)number for your depository account, such as a VOIDED blank check, a deposit slip, or similar documentation. The SF 1199A form is used to collect the information necessary to establish an account for the grantee in HUD's financial system. The form is to be completed by the grantee and grantee's financial institution.

Grant Award Process Overview
Below is a step-by-step walk-through of the process and necessary documents and forms to execute your FY2023 Grant Agreement. This process and the forms are also available in the FY2023 CPF Grant Guide, which can also be found on the program's webpage at:
https://www.hud.gov/program offices/comm_planning/edi-grants.

Grant Award Process
1) HUD will email a Grant Award Package including:
a. FY2023 Grant Award Letter(this letter)
b. FY2023 CPF Grant Guide
c. FY2023 CPF Grant Agreement
d. Links to Standard Forms (see list above in number 3) 2) Grantee should review the Grant Award Package documents and send HUD the following:
a. Signed and dated FY2023 CPF Grant Agreement
b. Completed Standard Forms
c. Detailed Project Narrative: The detailed project narrative should:
i. capture the maximum anticipated scope of the proposal, not just a single activity that the CPF grant is going toward; and
ii. include all contemplated actions that are part of the project. d. Line-Item Project Budget: The line-item budget should:
i. capture the maximum anticipated scope of the proposal including the use of the FY23 CPF grant funds in context of the full project budget; and ii. include all contemplated actions that are part of the project, not just a single activity that the CPF grant is going toward.
3) Grantee should initiate or complete a Federal environmental review: If the grantee has not yet done so, they should initiate an environmental review, as applicable. 4) HUD reviews returned Grant Award Package for completeness: Once HUD receives a completed grant award package, HUD will review the project narrative and budget, standard forms, grantee-signed and dated FY2023 CPF Grant Agreement. a. If complete, HUD will execute the FY2023 CPF Grant Agreement. b. If information is missing, HUD will work with grantee to finalize the Grant Award Package.
5) Payment Process: Once the Grant Agreement is executed by the Grantee and HUD, HUD will assist the grantee in getting set up in HUD's financial system. Once set up in HUD's financial system, grantees will submit payment requests.

To assist you with understanding the materials that you have received, HUD will host a series of webinars and "office hours" starting the week of March 6, 2023, to review the

requirements and support grantees through the grant award process and beyond. HUD will send reminder emails prior to each session with the registration link.

Overview of the FY2023 Act
CPF grants are subject to several Federal requirements. HUD will provide additional information and further clarification regarding applicable requirements and the grant award process in upcoming webinars and additional technical assistance. The most essential requirements include:
• Administrative Requirements: CPF grants are subject to the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards at 2 CFR Part 200. • Environmental Review Requirements: CPF grants, like all projects funded by HUD, are subject to requirements under the National Environmental Policy Act(NEPA), HUD's NEPA-implementing regulations at 24 CFR Part 50 or 24 CFR Part 58, and all appropriate federal environmental and historic preservation laws, regulations, and Executive Orders. o In keeping with the National Environmental Policy Act(NEPA) and HUD's NEPA- implementing regulations at 24 CFR Part 50 or 24 CFR Part 58,environmental reviews must be completed, and a Request for Release of Funds and Certification must be approved by HUD, as applicable, for all projects prior to taking any `choice limiting actions.'
o Environmental reviews must be completed before a grantee can undertake actions that prevent the grantee from taking an alternative action to minimize or avoid environmental harm, or that would have an adverse environmental impact("choice limiting actions"). This step is required to avoid violations under 24 CFR 58.22 which provides limitations on activities pending clearance, and Section 110(k) of the National Historic Preservation Act which prohibits anticipatory demolition or significant harm of cultural and/or historic resources prior to completion of the historic preservation review process known as Section 106 review. o HUD defines the "Federal Nexus" for a program or project as the event that triggers the requirements for federal environmental review under a host of laws, regulations, and Executive Orders, including the prohibition on choice limiting actions. • To be eligible, expenses must comply with applicable Federal requirements. This includes administrative requirements under 2 CFR Part 200, environmental laws, statutes and Executive Orders, and other"cross-cutting" federal requirements adhered to by HUD. In addition, environmental reviews are required for all HUD funded programs and project activities. This includes soft costs as well as hard costs.
• For FY2023 grants, the date of the FY 2023 Act's enactment(December 29, 2022)is the date of eligibility for reimbursement for hard and soft costs and the date of the federal nexus 1 Choice limiting actions constitute work, such as entering construction contract agreements/commitments and earth-moving activities/clearing/grubbing as well as building renovation/upgrades,that can have an adverse impact on cultural and/or historical resources or the environment,or prevent the avoidance,minimization,or mitigation of those impacts.

Examples of`choice limiting actions'include,but are not limited to,purchasing land,entering into contracts for property acquisition or construction,or physical work on the project.

for compliance with all environmental laws. Therefore, reimbursable/eligible hard costs can be incurred after enactment once a full environmental review is completed. • HUD conducted a nationwide environmental review to clear activities such as administrative,planning, and operations and maintenance costs (including costs to prepare an environmental review).
o After execution of the FY2023 CPF Grant Agreement, these soft costs may be reimbursed if incurred after December 29, 2022, and the costs would otherwise meet the allowability criteria in 2 CFR 200.403.
o Hard costs can be reimbursed if incurred after a full environmental review is completed and the costs would otherwise meet the allowability criteria in 2 CFR 200.403.

Further explanation and guidance on choice limiting actions and the environmental review process, including historic preservation review, is included within the FY2023 CPF Grant Guide and on the program's webpage.

All information required for your grant award should be submitted via email to the dedicated mailbox at [email protected]. In transmitting your information, please copy and paste the bolded information as the subject line of your email: : : Submission of Required Grant Materials.

If you, or your staff, have any questions regarding how to complete or submit the required documents or about your grant in general,please feel free to contact Njeri Santana-Carter , in CGD at [email protected]. Please note while your grant officer may change over time, we have a team approach to managing your project. Njeri Santana-Carter is the primary point of contact at HUD for this award and will be available to assist you. Include your grant number and grant name in all email correspondence.

We look forward to working with you on this important project! Sincerely,
Robin J. Keegan
Deputy Assistant Secretary
Economic Development
ATTACHMENTS:

FY2023 Community Project Funding Grant Guide(Version 1) FY2023 CPF Grant Agreement
Form HUD-1044—Assistance Award/Amendment Form

FY 2023 COMMUNITY PROJECT FUNDING
GRANT AGREEMENT NO. B-23-CP-CA-0243
Grantee Name: City of Upland
Grantee Address: 460 N. Euclid Ave. Upland, CA 91786
Grantee's Unique Entity Identifier(UEI):

Grantee's Employer Identification Number (EIN)
Federal Award Identification Number (FAIN) B-23-CP-CA-0243 Assistance Listing Number and Name 14.251 Economic Development Initiative, Community Project Funding, and Miscellaneous Grants
Period of Performance/Budget Period Start Date Date of grant obligation Period of Performance/Budget Period End Date August 31, 2031 This Grant Agreement between the Department of Housing and Urban Development (HUD) and City of Upland(the Grantee) is made pursuant to the authority of the Consolidated Appropriations Act, 2023 (Public Law 117-103) and the Explanatory Statement for Division L of that Act,which was printed in the Senate section of the Congressional Record on December 20, 2022 (Explanatory Statement).

In reliance upon and in consideration of the mutual representations and obligations under this Grant Agreement, HUD and the Grantee agree as follows:

ARTICLE I. Definitions
The definitions at 2 CFR 200.1 apply to this Grant Agreement, except where this Grant Agreement specifically states otherwise.

Budget period is defined in 2 CFR 200.1 and begins and ends on the dates specified above for the Period of Performance/Budget Period Start Date and Period of Performance/Budget Period End Date.

Period of Performance is defined in 2 CFR 200.1 and begins and ends on the dates specified above for the Period of Performance/Budget Period Start Date and Period of Performance/Budget Period End Date.

ARTICLE II. Total Grant Amount
Subject to the provisions of the Grant Agreement, HUD will make grant funds in the amount of$750,000 available to the Grantee.

ARTICLE III. Award-Specific Requirements
A. Federal Award Description. The Grantee must use the Federal funds provided under this Grant Agreement(Grant Funds) to carry out the Grantee's "Project." Unless changed in accordance with Article III, section C of this Grant Agreement, the Grantee's Project shall be as described in the Project Narrative that is approved by HUD as of the date that HUD signs this Grant Agreement. For reference, HUD will attach this approved Project Narrative as Appendix 1 to the Grant Agreement on the date that HUD signs this Grant Agreement.

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B. Approved Budget. The Grantee must use the Grant Funds as provided by the Approved Budget. Unless changed in accordance with Article III, section C of this Grant Agreement, the Approved Budget shall be the line-item budget that is approved by HUD as of the date that HUD signs this Grant Agreement. For reference, HUD will attach this approved line-item budget as Appendix 2 to this Grant Agreement on the date that HUD signs this Grant Agreement.

C. Project and Budget Changes. All changes to the Grantee's Project or Approved Budget must be made in accordance with 2 CFR 200.308 and this Grant Agreement. To request HUD's approval for a change in the Project or Approved Budget, the Grantee must submit a formal letter to the Director of HUD's Office of Economic Development - Congressional Grants Division through the assigned Grant Officer. The letter must be submitted by email to the assigned Grant Officer and must provide justification for the change. The email submitting the letter must also include a revised project narrative or revised line-item budget, as applicable, that includes the requested change. The Grantee is prohibited from making project or budget changes that would conflict with the Applicable Appropriations Act Conditions described in Article III, section D of this Grant Agreement. The assigned Grant Officer for this grant is provided in the Award Letter for this grant and found on HUD's website. The HUD Office of Economic Development— Congressional Grants Division will notify the Grantee in writing, by email, whether HUD approves or disapproves the change. Before the Grantee expends Grant Funds in accordance with any change approved by HUD or otherwise allowed by 2 CFR 200.308, the Grantee must update its grant information in Disaster Recovery Grant Reporting(DRGR) to reflect that change.

D. Applicable Appropriations Act Conditions. The conditions that apply to the Grant Funds as provided by the Consolidated Appropriations Act, 2023 and the Explanatory Statement are hereby incorporated and made part of this Grant Agreement. In the event of a conflict between those conditions, the conditions provided by the Act will govern. The Grant Funds are not subject to the Community Development Block Grants regulations at 24 CFR part 570 or Title I of the Housing and Community Development Act of 1974.

E. In accordance with 2 CFR 200.307(b), costs incidental to the generation of program income may be deducted from gross income to determine program income, provided these costs have not been charged to the grant. As authorized under 2 CFR 200.307(e)(2), program income may be treated as an addition to the Federal award,provided that the Grantee uses that income for allowable costs under this Grant Agreement. In accordance with 2 CFR 200.307(b), costs incidental to the generation of program income may be deducted from gross income to determine program income, provided these costs have not been charged to the grant. Any program income that cannot be expended on allowable costs under this Grant Agreement must be paid to HUD before closeout of the grant, unless otherwise specified by an applicable Federal statute.

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F. The Grantee must use the Grant Funds only for costs (including indirect costs) that meet the applicable requirements in 2 CFR part 200 (including appendices). The Grantee's indirect cost rate information is as provided in Appendix 3 to this Grant Agreement. Unless the Grantee is an Institution of Higher Education,the Grantee must immediately notify HUD upon any change in the Grantee's indirect cost rate during the Period of Performance, so that HUD can amend the Grant Agreement to reflect the change if necessary. Consistent with 2 CFR Part 200, Appendix III (C.7), if the Grantee is an Institution of Higher Education and has a negotiated rate in effect on the date this Grant Agreement is signed by HUD, the Grantee may use only that rate for its indirect costs during the Period of Performance.

G. The Grantee must comply with any specific award conditions that HUD may attach to this Grant Agreement as provided by 2 CFR 200.208. If applicable, these conditions will be listed or added as Appendix 5 to this Grant Agreement.

H. The Grantee is responsible for managing the Project and ensuring the proper use of the Grant Funds. The Grantee is also responsible for ensuring the completion of the Project, the grant closeout, and compliance with all applicable federal requirements. The Grantee may subaward all or a portion of its funds to one or more subrecipients, as identified in the Project Narrative (Appendix 1) or as may be approved by HUD in accordance with 2 CFR 200.308.

All subawards made with funding under this Grant Agreement are subject to the subaward requirements under 2 CFR Part 200, including 2 CFR 200.332, and other requirements provided by this Grant Agreement. The Grantee is responsible for ensuring each subrecipient complies with all requirements under this Grant Agreement, including the general federal requirements in Article IV. A subaward may be made to a for-profit entity only if HUD expressly approves that subaward and the for-profit entity is made subject to the same Federal requirements that apply to all other subrecipients, including the requirements 2 CFR part 200 provides for a"non-Federal entity"that receives a subaward.

ARTICLE IV. General Federal Requirements
A. If the Grantee is a unit of general local government, a State, an Indian Tribe, or an Alaskan Native Village, the Grantee is the Responsible Entity(as defined in 24 CFR part 58) and agrees to assume all of the responsibilities for environmental review and decision- making and action, as specified and required in regulations issued by the Secretary pursuant to section 305(c) of the Multifamily Housing Property Disposition Reform Act of 1994 and published in 24 CFR Part 58.

B. If the Grantee is a housing authority,redevelopment agency, academic institution, hospital or other non-profit organization, the Grantee shall request the unit of general local government, Indian Tribe or Alaskan Native Village, within which the Project is located and which exercises land use responsibility, to act as Responsible Entity and assume all of the responsibilities for environmental review and decision-making and action as specified in paragraph A above, and the Grantee shall carry out all of the responsibilities of a grantee under 24 CFR Part 58.

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GRANT AGREEMENT NO.B-23-CP-CA-0243
C. After December 29, 2022, neither the Grantee nor any of its contractors, subrecipients and other funding and development partners may undertake, or commit or expend Grant Funds or local funds for,project activities (other than for planning, management, development and administration activities),unless a contract requiring those activities was already executed on or before December 29, 2022,until one of the following occurs: (i)the Responsible Entity has completed the environmental review procedures required by 24 CFR part 58, and HUD has approved the environmental certification and given a release of funds; (ii)the Responsible Entity has determined and documented in its environmental review record that the activities are exempt under 24 CFR 58.34 or are categorically excluded and not subject to compliance with environmental laws under 24 CFR 58.35(b); or(iii) HUD has performed an environmental review under 24 CFR part 50 and has notified Grantee in writing of environmental approval of the activities.

D. Following completion of the environmental review process, the Grantee (recipient) shall exercise oversight, monitoring, and enforcement as necessary to assure that decisions and mitigation measures adopted through the environmental review process are carried out during project development and implementation.

E. The Grantee must comply with the generally applicable HUD and CPD requirements in 24 CFR Part 5, subpart A, including all applicable fair housing, and civil rights requirements. If the Grantee is a Tribe or a Tribally Designated Housing Entity (TDHE) as established under 24 CFR 1000.206,the Grantee must comply with the nondiscrimination requirements in 24 CFR 1000.12 in lieu of the nondiscrimination requirements in 24 CFR 5.105(a). The Grantee must report data on the race, color, religion, sex, national origin, age, disability, and family characteristics of persons and households who are applicants for,participants in, or beneficiaries or potential beneficiaries of the Grantee's Project, consistent with the instructions and forms provided by HUD in order to carry out its responsibilities under the Fair Housing Act, Executive Order 11063, Title VI of the Civil Rights Act of 1964, and Section 562 of the Housing and Community Development Act of 1987 (e.g. HUD-27061).

F. The Grantee must comply with the Uniform Administrative Requirements, Cost Principles, and Audit Requirements in 2 CFR part 200, as may be amended from time to time. If 2 CFR part 200 is amended to replace or renumber sections of part 200 that are cited specifically in this Grant Agreement, the part 200 requirements as renumbered or replaced by the amendments will govern the obligations of HUD and the Grantee after those amendments become effective.

G. The Grantee must comply with the Award Term in Appendix A to 2 CFR Part 25 ("System for Award Management and Universal Identifier Requirements") and the Award Term in Appendix A to 2 CFR Part 170 ("Reporting Subawards and Executive Compensation"), which are hereby incorporated into and made part of this Grant Agreement.

H. If the Total Grant Amount, as provided in Article II of this Grant Agreement, is greater than $500,000, the Grantee must comply with the Award Term and Condition for Grantee Integrity and Performance Matters in Appendix 4 to this Grant Agreement.

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I. Unless the Grantee is exempt from the Byrd Amendment as explained below, the Grantee must comply with the provisions of Section 319 of Public Law 101-121, 31 U.S.C. 1352, (the Byrd Amendment) and 24 CFR Part 87,which prohibit recipients of Federal contracts, grants, or loans from using appropriated funds for lobbying the executive or legislative branches of the Federal Government in connection with a specific contract, grant, loan, or cooperative agreement. The Grantee must include in its award documents for all sub-awards at all tiers (including subcontracts, subgrants, and contracts under grants, loans, and cooperative agreements), the requirements for the certification required by Appendix A to 24 CFR Part 87 and for disclosure using Standard Form- LLL (SF-LLL), "Disclosure of Lobbying Activities." In addition, the Grantee must obtain the executed certification required by Appendix A and an SF-LLL from all covered persons. "Person" is as defined by 24 CFR Part 87. Federally recognized Indian tribes and TDHEs established by Federally recognized Indian tribes as a result of the exercise of the tribe's sovereign power are excluded from coverage of the Byrd Amendment. State-recognized Indian tribes and TDHEs established only under state law must comply with this requirement.

J. The Grantee must comply with drug-free workplace requirements in Subpart B of 2 CFR Part 2429, which adopts the governmentwide implementation(2 CFR Part 182) of sections 5152-5158 of the Drug-Free Workplace Act of 1988, Pub. L. 100-690, Title V, Subtitle D (41 U.S.C. 701-707).

K. The Grantee must comply with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA) as implemented by regulations at 49 CFR Part 24. The URA applies to acquisitions of real property and relocation occurring as a direct result of the acquisition, rehabilitation, or demolition of real property for Federal or Federally funded programs or projects. Real property acquisition that receives Federal financial assistance for a program or project, as defined in 49 CFR 24.2, must comply with the acquisition requirements contained in 49 CFR part 24, subpart B. Unless otherwise specified in law, the relocation requirements of the URA and its implementing regulations at 49 CFR part 24, cover any displaced person who moves from real property or moves personal property from real property as a direct result of acquisition, rehabilitation, or demolition for a program or project receiving HUD financial assistance
L. If Grant Funds are used for purchase, lease, support services, operation, or work that may disturb painted surfaces, of pre-1978 housing, you must comply with the lead-based paint evaluation and hazard reduction requirements of HUD's lead-based paint rules (Lead Disclosure; and Lead Safe Housing(24 CFR part 35)), and EPA's lead-based paint rules (e.g., Repair, Renovation and Painting; Pre-Renovation Education; and Lead Training and Certification(40 CFR part 745)).

M. The Grantee must comply with Section 3 of the Housing and Urban Development Act of 1968 (Section 3), 12 U.S.C. 1701u, and HUD's regulations at 24 CFR part 75, as applicable, including the reporting requirements in 24 CFR 75.25. Grants made to Tribes and TDHEs are subject to Indian Preference requirements in Section 7(b) of the Indian Self- Determination and Education Assistance Act(25 U.S.C. 5307(b)). As stated in 24 CFR 75.3(c), grants to Tribes and TDHEs are subject to Indian Preference requirements in lieu of Section 3.

Grantees that are not exempt from Section 3 must submit annual reports of Section 3

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GRANT AGREEMENT NO.B-23-CP-CA-0243
accomplishment Performance Measures in DRGR in January of the calendar year.

This report reflects Section 3 accomplishments for the previous calendar year.

N. The Grantee must not use any Grant Funds to support any Federal, state, or local project that seeks to use the power of eminent domain,unless eminent domain is employed only for a public use. Public use includes use of funds for mass transit, railroad, airport, seaport, or highway projects, and utility projects which benefit or serve the general public (including energy-related, communication-related, water-related, and waste water-related infrastructure), other structures designated for use by the general public or with other common-carrier or public-utility functions that serve the general public and are subject to regulation and oversight by the government, and projects for the removal of an immediate threat to public health and safety or brownfields, as defined in the Small Business Liability Relief and Brownfields Revitalization Act(Pub. L. 107- 118). Public use does not include economic development that primarily benefits private entities.

O. The Grantee must not use any Grant Funds to maintain or establish a computer network that does not block the viewing, downloading, and exchanging of pornography.

This requirement does not limit the use of funds necessary for any Federal, State, tribal, or local law enforcement agency or any other entity carrying out criminal investigations, prosecution, or adjudication activities.

P. The Grantee must administer its Grant Funds in accordance with the Conflict of Interest requirements set forth in Appendix 6 of this Grant Agreement.

Q. The Grantee must comply with the governmentwide debarment and suspension requirements in 2 CFR part 180 as incorporated and supplemented by HUD's regulations at 2 CFR part 2424.

R. The Grantee must comply with the award term and condition regarding trafficking in persons in Appendix 7 of this Grant Agreement.

S. The assurances and certifications the Grantee has made and submitted to HUD are incorporated by this reference and made part of this Grant Agreement.

ARTICLE V.Drawdown Requirements
A. The Grantee may not draw down Grant Funds until HUD has received and approved any certifications and disclosures required by 24 CFR 87.100 concerning lobbying, if applicable.

B. The Grantee must use HUD's Disaster Recovery Grant Reporting (DRGR) system to draw down Grant Funds and report to HUD on activities.

C. The Grantee must enter activity and budget information in DRGR that is consistent with the Grantee's Project and Approved Budget as described in Article III, sections A and B of this Grant Agreement and complies with HUD's instructions for entering information in DRGR found in the document titled"Grant Award Instructions" that accompanies the Grant Agreement.

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D. The Grantee must only enter activities in DRGR that are described in the Approved Budget.

E. The Grantee must expend all Grant Funds in accordance with the activity and budget information in DRGR.

F. Each drawdown of Grant Funds constitutes a representation by the Grantee that the funds will be used in accordance with this Grant Agreement.

G. The Grantee must use DRGR to track the use of program income and must report the receipt and use of program income in the reports the Grantee submits to HUD under Article VI of this Grant Agreement. The Grantee must expend program income before drawing down Grant Funds through DRGR.

H. Notwithstanding any other provision of this grant agreement, HUD will not be responsible for payment of any Grant Funds after the date Treasury closes the account in accordance with 31 U.S.C. § 1552. Because Treasury may close the account up to one week before the September 30 date specified by 31 U.S.C. § 1552, the Grantee is advised to make its final request for payment under the grant no later than September 15, 2031.

ARTICLE VI. Program-Specific Reporting Requirements
In addition to the general reporting requirements that apply under other provisions of this Agreement, the following program-specific reporting requirements apply to the Grantee:

A. The Grantee must submit a performance report in DRGR on a semi-annual basis and must include a completed Federal financial report as an attachment to each performance report in DRGR. Performance reports shall consist of a narrative of work accomplished during the reporting period. During the Period of Performance, the Grantee must submit these reports in DRGR no later than 30 calendar days after the end of the 6- month reporting period. The first of these reporting periods begins on the first of January or June (whichever occurs first) after the date this Grant Agreement is signed by HUD.

B. The performance report must contain the information required for reporting program performance under 2 CFR 200.329(c)(2) and(d), including a comparison of actual accomplishments to the objectives of the Project as described in Article III, section A of this Grant Agreement, the reasons why established goals were not met, if appropriate, and additional pertinent information including, when appropriate, analysis and explanation of cost overruns or high unit costs.

C. Financial reports must be submitted using DRGR or such future collections HUD may require and as approved by OMB and listed on the Grants.gov website ( https://www.grants.gov/web/grants/forms/post-award-reporting-forms.html) .

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D. The performance and financial reports will undergo review and approval by HUD. If a report submission is insufficient, HUD will reject the report in DRGR and identify the corrections the Grantee must make.

E. No drawdown of funds will be allowed through DRGR while the Grantee has an overdue performance or financial report.

F. The Grantee must report and account for all property acquired or improved with Grant Funds as provided by 2 CFR part 200 using the applicable common forms approved by OMB and provided on the Grants.gov website
( https://www.grants.gov/web/grants/forms/post-award-reporting-forms.html) . This reporting obligation includes submitting status reports on real property at least annually as provided by 2 CFR 200.330, accounting for real and personal property acquired or improved with Grant Funds as part of Project Closeout, and promptly submitting requests for disposition instructions as provided by 2 CFR 200.311(c), 200.313(e), and 200.314(a).

ARTICLE VII. Project Closeout
A. The grant will be closed out in accordance with 2 CFR part 200, as may be amended from time to time, except as otherwise specified in this Grant Agreement.

B. The Grantee must submit to HUD a written request to closeout the grant no later than 30 calendar days after the Grantee has drawn down all Grant Funds and completed the Project as described in Article III, section A of this Grant Agreement.

HUD will then send the Closeout Agreement and Closeout Certification to the Grantee.

C. At HUD's option, the Grantee may delay initiation of project closeout until the resolution of any findings as a result of the review of semi-annual activity reports in DRGR. If HUD exercises this option, the Grantee must promptly resolve the findings.

D. The Grantee recognizes that the closeout process may entail a review by HUD to determine compliance with the Grant Agreement by the Grantee and all participating parties. The Grantee agrees to cooperate with any HUD review, including reasonable requests for on-site inspection of property acquired or improved with Grant Funds.

E. No later than 120 calendar days after the Period of Performance, Grantees shall provide to HUD the following documentation:

1. A Certification of Project Completion.

2. A Grant Closeout Agreement.

3. A final financial report giving the amount and types of project costs charged to the grant(that meet the allowability and allocability

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requirements of 2 CFR part 200, subpart E); a certification of the costs; and the amounts and sources of other project funds.

4. A final performance report providing a comparison of actual accomplishments with the objectives of the Project, the reasons for slippage if established objectives were not met and additional pertinent information including explanation of significant cost overruns.

5. A final property report, if specifically requested by HUD at the time of closeout.

ARTICLE VIII. Default
A default under this Grant Agreement shall consist of any use of Grant Funds for a purpose other than as authorized by this Grant Agreement, any noncompliance with statutory, regulatory, or other requirements applicable to the Grant Funds, any other material breach of this Grant Agreement, or any material misrepresentation in the Grantee's submissions to HUD in anticipation of this award. If the Grantee fails to comply with the terms and conditions of the Grant Agreement, HUD may adjust specific conditions of this Grant Agreement as described in 2 CFR part 200, as may be amended from time to time. If HUD determines that noncompliance cannot be remedied by imposing additional conditions, HUD may take one or more of the remedies for noncompliance described in 2 CFR part 200, as may be amended from time to time.

HUD may also terminate all or a part of this award as provided by 2 CFR 200.340 and other applicable provisions of 2 CFR part 200, as may be amended from time to time. Nothing in this Grant Agreement shall be construed as creating or justifying any claim against the Federal government or the Grantee by any third party.

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ARTICLE IX. HUD Contact Information
Except where this Grant Agreement specifically states otherwise, all requests, submissions, and reports the Grantee is required to make to HUD under this Grant Agreement must be made in writing via email to [email protected].

This agreement is hereby executed on behalf of the Grantee and HUD as follows:

GRANTEE
(Name of Organization)
BY:
(Signature of Authorized Official)
(Typed Name and Title of Authorized Official)
(Date)
HUD
BY:

Robin J. Keegan,
Deputy Assistant Secretary for Economic Development
(Date)

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APPENDIX 1 —Project Narrative

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APPENDIX 2 —Approved Budget

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APPENDIX 3 —Grantee's Indirect Cost Rate Information
Subject to the applicable requirements in 2 CFR part 200 (including its appendices), the Grantee will use an indirect cost rate as represented by the Grantee below:
❑ The Grantee will not use an indirect cost rate to charge its indirect costs to the grant.
❑ The Grantee will use the indirect cost rate(s) identified in the table below to charge its indirect costs to the grant.

Agency/Dept./Major Function Indirect cost rate Direct Cost Base %
%
[PLEASE NOTE: The grantee must check one of the two boxes above. If the second box is checked, the corresponding table must be filled out as described below.

The table must include each indirect cost rate that will be used to calculate the Grantee's indirect costs under the grant. The table must also specify the type of direct cost base to which each included rate applies (for example, Modified Total Direct Costs (MTDC)). Do not include indirect cost rate information for subrecipients.

For government entities, enter each agency or department that will carry out activities under the grant,the indirect cost rate applicable to each department/agency (including if the de minimis rate is used per 2 CFR 200.414), and the type of direct cost base to which the rate will be applied.

For nonprofit organizations that use the Simplified Allocation Method for indirect costs or elects to use the de minimis rate of 10% of Modified Total Direct Costs in accordance with 2 CFR 200.414, enter the applicable indirect cost rate and type of direct cost base in the first row of the table.

For nonprofit organizations that use the Multiple Allocation Base Method, enter each major function of the organization for which a rate was developed and will be used under the grant, the indirect cost rate applicable to that major function, and the type of direct cost base to which the rate will be applied.]

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APPENDIX 4—
Award Term and Condition for Grantee Integrity and Performance Matters Reporting of Matters Related to Grantee Integrity and Performance

1. General Reporting Requirement
If the total value of the Grantee's currently active grants, cooperative agreements, and procurement contracts from all Federal awarding agencies exceeds $10,000,000 for any period of time during the period of performance of this Federal award, then during that period of time the Grantee must maintain the currency of information reported to the System for Award Management(SAM) that is made available in the designated integrity and performance system (currently the Federal Awardee Performance and Integrity Information System(FAPIIS)) about civil, criminal, or administrative proceedings described in paragraph 2 of this award term and condition. This is a statutory requirement under section 872 of Public Law 110-417, as amended (41 U.S.C. 2313). As required by section 3010 of Public Law 111-212, all information posted in the designated integrity and performance system on or after April 15, 2011, except past performance reviews required for Federal procurement contracts,will be publicly available.

2. Proceedings About Which Grantee Must Report
During any period of time when the Grantee is subject to the requirement in paragraph 1 of this award term and condition, the Grantee must submit the information required about each proceeding that:
a. Is in connection with the award or performance of a grant, cooperative agreement, or procurement contract from the Federal Government;
b. Reached its final disposition during the most recent five-year period; and c. Is one of the following:
(1)A criminal proceeding that resulted in a conviction, as defined in paragraph 5 of this award term and condition;
(2)A civil proceeding that resulted in a finding of fault and liability and payment of a monetary fine,penalty, reimbursement, restitution, or damages of$5,000 or more; (3)An administrative proceeding, as defined in paragraph 5. of this award term and condition, that resulted in a finding of fault and liability and the Grantee's payment of either a monetary fine or penalty of$5,000 or more or reimbursement,restitution, or damages in excess of$100,000; or
(4)Any other criminal, civil, or administrative proceeding if:
(i) It could have led to an outcome described in paragraph 2.c.(1), (2), or(3) of this award term and condition;

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(ii) It had a different disposition arrived at by consent or compromise with an acknowledgment of fault on the Grantee's part; and
(iii) The requirement in this award term and condition to disclose information about the proceeding does not conflict with applicable laws and regulations.

3. Reporting Procedures
During any period of time when the Grantee is subject to the requirement in paragraph 1 of this award term and condition, the Grantee must enter in the SAM Entity Management area the information that SAM requires about each proceeding described in paragraph 2 of this award term and condition. The Grantee does not need to submit the information a second time under assistance awards that the Grantee received if the Grantee already provided the information through SAM because the Grantee was required to do so under Federal procurement contracts that the Grantee was awarded.

4. Reporting Frequency
During any period of time when the Grantee is subject to the requirement in paragraph 1 of this award term and condition, the Grantee must report proceedings information through SAM for the most recent five-year period, either to report new information about any proceeding(s)that the Grantee has not reported previously or affirm that there is no new information to report. If the Grantee has Federal contract, grant, and cooperative agreement awards with a cumulative total value greater than$10,000,000,the Grantee must disclose semiannually any information about the criminal, civil, and administrative proceedings.

S. Definitions
For purposes of this award term and condition:
a. Administrative proceeding means a non judicial process that is adjudicatory in nature in order to make a determination of fault or liability(e.g., Securities and Exchange Commission Administrative proceedings, Civilian Board of Contract Appeals proceedings, and Armed Services Board of Contract Appeals proceedings). This includes proceedings at the Federal and State level but only in connection with performance of a Federal contract or grant. It does not include audits, site visits, corrective plans, or inspection of deliverables. b. Conviction, for purposes of this award term and condition, means a judgment or conviction of a criminal offense by any court of competent jurisdiction, whether entered upon a verdict or a plea, and includes a conviction entered upon a plea of nolo contendere. c. Total value of currently active grants, cooperative agreements, and procurement contracts includes—
(1) Only the Federal share of the funding under any Federal award with a cost share or match requirement; and
(2) The value of all expected funding increments under a Federal award and options, even if not yet exercised.

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APPENDIX 5—Specific Award Conditions
NONE.

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APPENDIX 6—Conflict of Interest Requirements

1. Conflicts Subject to Procurement Regulations. When procuring property or services, the grantee and its subrecipients shall comply with the applicable conflict-of-interest rules in 2 CFR 200.317 and 2 CFR 200.318(c). In all cases not governed by 2 CFR 200.317 and 2 CFR 200.318(c), the Grantee and its subrecipients must follow the requirements contained in paragraphs 2-5 below.

2. General prohibition.No person who is an employee, agent, consultant, officer, or elected or appointed official of the Grantee or subrecipient and who exercises or has exercised any functions or responsibilities with respect to assisted activities, or who is in a position to participate in a decision making process or gain inside information with regard to such activities, may obtain a financial interest or benefit from the activity, or have a financial interest in any contract, subcontract, or agreement with respect thereto, or the proceeds thereunder, either for himself or herself or for those with whom he or she has immediate family or business ties, during his or her tenure or for one year thereafter. Immediate family ties include (whether by blood, marriage or adoption)the spouse,parent(including a stepparent), child(including a stepchild), sibling (including a stepsibling), grandparent, grandchild, and in-laws of a covered person.

3. Exceptions. HUD may grant an exception to the general prohibition in paragraph (ii)upon the Grantee's written request and satisfaction of the threshold requirements in paragraph(iv), if HUD determines the exception will further the Federal purpose of the award and the effective and efficient administration of the Grantee's Project, taking into account the cumulative effects of the factors in paragraph(v).

4. Threshold requirements for exceptions. HUD will consider an exception only after the Grantee has provided the following documentation:
a. A disclosure of the nature of the conflict, accompanied by an assurance that there has been public disclosure of the conflict and a description of how that disclosure was made; and
b. An opinion of the Grantee's attorney that the interest for which the exception is sought would not violate state or local law.

5. Factors to be considered for exceptions. In determining whether to grant a requested exception after the Grantee has satisfactorily met the threshold requirements in paragraph(iii), HUD will consider the cumulative effect of the following factors,where applicable:
a. Whether the exception would provide a significant cost benefit or an essential degree of expertise to the program or project that would otherwise not be available; b. Whether an opportunity was provided for open competitive bidding or negotiation; c. Whether the person affected is a member of a group or class of low- or moderate- income persons intended to be the beneficiaries of the assisted activity, and the exception

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will permit such person to receive generally the same interests or benefits as are being made available or provided to the group or class;
d. Whether the affected person has withdrawn from his or her functions or responsibilities, or the decision-making process regarding the assisted activity in question; e. Whether the interest or benefit was present before the affected person was in a posit ion as described in paragraph(ii);
f Whether undue hardship will result either to the Grantee or the person affected when weighed against the public interest served by avoiding the prohibited conflict; and g. Any other relevant considerations.

6. Disclosure of potential conflicts of interest. The Grantee must disclose in writing to HUD any potential conflict of interest.

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APPENDIX 7—Award Term and Condition Regarding Trafficking in Persons The following award term and condition,which is required by 2 CFR part 175, applies as written:
a. Provisions applicable to a grantee that is a private entity.

1.You as the grantee,your employees, subrecipients under this award, and subrecipients' employees may not—
i. Engage in severe forms of trafficking in persons during the period of time that the award is in effect;
ii. Procure a commercial sex act during the period of time that the award is in effect; or
iii. Use forced labor in the performance of the award or subawards under the award.

2.We as the Federal awarding agency may unilaterally terminate this award, without penalty, if you or a subrecipient that is a private entity:
i. Is determined to have violated a prohibition in paragraph a.1 of this award term; or
ii. Has an employee who is determined by the agency official authorized to terminate the award to have violated a prohibition in paragraph a.1 of this award term through conduct that is either—
A. Associated with performance under this award; or
B. Imputed to you or the subrecipient using the standards and due process for imputing the conduct of an individual to an organization that are provided in 2 CFR Part 180, "OMB Guidelines to Agencies on Governmentwide Debarment and Suspension(Nonprocurement)," as implemented by HUD at 2 CFR 2424.
b. Provision applicable to a grantee other than a private entity.

We as the Federal awarding agency may unilaterally terminate this award, without penalty, if a subrecipient that is a private entity-

1. Is determined to have violated an applicable prohibition in paragraph a.1 of this award term; or

2. Has an employee who is determined by the agency official authorized to terminate the award to have violated an applicable prohibition in paragraph a.1 of this award term through conduct that is either:

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i. Associated with performance under this award; or
ii. Imputed to the subrecipient using the standards and due process for imputing the conduct of an individual to an organization that are provided in 2 CFR part 180, "OMB Guidelines to Agencies on Governmentwide Debarment and Suspension(Nonprocurement)," as implemented by HUD at 2 CFR 2424. c. Provisions applicable to any grantee.

1. You must inform us immediately of any information you receive from any source alleging a violation of a prohibition in paragraph a.1 of this award term.

2. Our right to terminate unilaterally that is described in paragraph a.2 or b of this section:
i. Implements section 106(g) of the Trafficking Victims Protection Act of 2000 (TVPA), as amended(22 U.S.C. 7104(g)), and
ii. Is in addition to all other remedies for noncompliance that are available to us under this award.

3. You must include the requirements of paragraph a.1 of this award term in any subaward you make to a private entity.
d. Definitions. For purposes of this award term:

1."Employee"means either:
i. An individual employed by you or a subrecipient who is engaged in the performance of the project or program under this award; or ii. Another person engaged in the performance of the project or program under this award and not compensated by you including, but not limited to, a volunteer or individual whose services are contributed by a third party as an in-kind contribution toward cost sharing or matching requirements.

2. "Forced labor"means labor obtained by any of the following methods: the recruitment, harboring,transportation,provision, or obtaining of a person for labor or services, through the use of force, fraud, or coercion for the purpose of subjection to involuntary servitude, peonage, debt bondage, or slavery.

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3. "Private entity":
i. Means any entity other than a State, local government, Indian tribe, or foreign public entity, as those terms are defined in 2 CFR 175.25. ii. Includes:

A. A nonprofit organization, including any nonprofit institution of higher education, hospital, or tribal organization other than one included in the definition of Indian tribe at 2 CFR 175.25(b).

B. A for-profit organization.

4. "Severe forms of trafficking in persons," "commercial sex act," and"coercion" have the meanings given at section 103 of the TVPA, as amended(22 U.S.C. 7102).

..t• �pl"� CITY FU P LA N D
"The City of Gracious Living"
Staff(krctilt
C�tIFOB�S
DATE: October 9,2023
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:BRADEN YU,PUBLIC WORKS DIRECTOR

ALAN FRENCH,PRINCIPAL ENGINEER
SUBJECT: CONSIDER AWARD OF BID FOR DOWNTOWN PARKLETS PROJECT(BID 2023-08) RECOMMENDED ACTION:

It is recommended that the City Council approve the plans and specifications for Project 32337 -Downtown Parklets Improvements;award the construction contract to DASH Construction in the amount of$1,243,013.56,which includes a 15%contingency;authorize an additional budget allocation of$350,000 from Quimby funds and authorize the City Manager to execute the agreement and any future extension or amendments within the City Manager's authority.

GOAL STATEMENT
The proposed action supports the City's goal of creating additional public open space and public realm improvements in the Downtown as part of the Downtown revitalization strategy. The project encourages a pedestrian-oriented environment with the addition of public open space for patrons to enjoy the open air and outdoor environment in Downtown.

BACKGROUND
The Downtown Upland Parklets Project will convert parking spaces at four locations in the downtown area, (two on 2nc Avenue at the alley crossings just north and south of 9th as well as on 9th Street at the alley crossings just east and west of 2nd Avenue)to areas with outdoor seating.

The scope of work included three, six(6)foot wide benches with a center bar and no backing to promote short term usage,one side-loaded trash receptacles to prevent individuals from foraging through the trash,additional landscaping within existing and expanded planters,expansion of the 30-inch high brick garden walls to enclose the space,concrete foundation with stamped art;and new permanent metal bollards to prevent vehicles from crossing through the center of this area.
• On July 27, 2020, the City Council approved $60,000 for the Wood platform design using Community Development Block Grant — coronavirus (CDBG-CV1) CARES Act Funding for the Downtown Parklet Project.
• On March 15,2022,the CDBG Committee concurred with staff's recommendation to reallocate$58,651.72 of unexpended CDBG-CV3 originally allocated to the Upland Small Business Support: Rent Recovery Program(USBSRRP). Subsequent to that approval, additional USBSRRP spending occurred. The amount that was actually transferred to the Downtown Parklet Project was$31,286. • On November 22,2021,the City Council approved use of$120,000 of American Rescue Plan Act(ARPA) funds to cover the cost of the amended mid-block crossing design for the Downtown Parklet Project. • On December 12, 2022,the City Council approved the revised design and cost estimate for the Downtown Upland Parklets Project and acknowledged the use of an allocation of$200,000 from the soon to be awarded Congressman Aguilar Community Project Funding Grant for the Downtown Parklet Project. • On December 12,2022,the City Council approved the use of$100,000 of Quimby/Park Development fund balance for the Downtown Parklet Project.

In March 2023,the City advertised a Notice Inviting Bids(NIB) for the Downtown Upland Parklets Project but the resulting bids that were received are much higher than what was originally budgeted. The scope of work was originally based on costs for bollards that are no longer available at the estimated cost nor are the covers for those bollards

available. As a result,on June 12,2023,the City Council rejected all bids for the Downtown Upland Parklets Project; approved the revised plans and specifications;and directed staff to re-advertise the project.

ISSUES AND ANALYSIS
The City rebid the project with a Notice Inviting Bids (NIB)that was placed in the Inland Valley Daily Bulletin on June 23 and 30,2023 in accordance with the California Public Contract Code(Section 20164). It was also listed on the City's website and distributed to various electronic plan rooms.

On July 24,2023,the City issued Addendum No. 1 providing a clarification on the bid documents for the project.

On July 27,2023,the City received and opened two bids for the Project,under bid No.2023-08 as follows:

BIDDER BID AMOUNT
Gentry General Engineering Inc. $1,533,883.91
DASH Construction Company Inc. $1,243,013.56
Staff reviewed the bid information, including DASH Construction's bid calculations and confirmed that DASH Inc. was the lowest responsible and responsive bidder.

Estimated Project#32337 Costs
Construction Contract Amount $ 1,243,013.56
(Including a 15%contingency)
Design and Project Administration $ 37,272.44
Construction Management and Inspection $ 55,000.00 Material Testing $ 10,000.00
Total Project Costs $ 1,345,286.00
Proposed Sources of Funding for Project#32337
CDBG-CV-1&3 Fund 209 $ 91,286.00
ARPA Fund 229 $ 120,000.00
Quimby Fund 421 $ 450,000.00
Aguilar Grant*Fund 240 $ 200,000.00
Torres Grant*Fund 240 $ 484,000.00
Total Project Funding $ 1,345,286.00
*Pending approval of consent calendar item Acceptance of Congressmen Aguilar and Torres Community Project Fund Grant Awards.

ENVIRONMENTAL DETERMINATION
The Project has been assessed in accordance with the authority and criteria contained in the California Environmental Quality Act CEQA and the State CEQA Guidelines and determined to be categorically exempt from further environmental review pursuant to Section 15301(c)(Existing Facilities)of the CEQA guidelines.The Project involves repair and maintenance of existing public facilities and does not involve expansion of use beyond that which is existing.The City filed the Notice of Exemption with the County of San Bernardino on March 7,2023.

FISCAL IMPACTS
Using fund balance,an additional appropriation of$350,000 in the Quimby/Park Development fund 421 is necessary to complete the funding of the Downtown Parklet Project#32337.

ALTERNATIVES

1.Reject all bids and rebid the project.

2.Provide alternative directions to staff.

CEQA: Determined to be categorically exempt from further environmental review pursuant to Section 15301(c) (Existing Facilities)of the CEQA guidelines.

CITY OF UPLAND

TABULATION OF BIDS
BID NO. 2023-08
PROJECT NO. 32337

DOWNTOWN PARKLET PROJECT
Bid Opening July 27, 2023 @ 9:00 A.M.

BIDDER BID BOND TOTAL AMOUNT
Gentry General Engineering Bond - Y
Add - Y $1,533,883.91
Dash Construction Company Bond - Y
Add - Y $1,243,013.56
BID OPENING ATTENDED AND ATTESTED TO BY:

Alan French, Principal Engineer
Keri Johnson, City Clerk
Jennifer Rodriguez, Deputy City Clerk

City of Upland
Summary of Quimby Fee Activity FY 2007 to FY 2023
As of June 29,2023
Description Total FY 22/23 FY 21/22 FY 20/21 FY 19/20 FY 18/19 FY 17/18 FY 16/17 FY 15/16 FY 14/15 FY 13/14 FY 12/13 FY 11/12 FY 10/11 FY 09/10 FY 08/09 FY 07/08 FY 06/07 Unallocated:

Quimby Fees Earned $ 2,352,762 $ 43,977 229,550 - 492,200 233,882 - 370,316 416,152 368,428 - 10,700 - 182,628 - - - 4,929 Interest Allocated $ 23,419 (91,963) (174) 55,419 30,778 16,485 7,061 1,675 953 21 108 998 1,309 49 22 677 - QuimbyFeesTransferred $ (1,685,474) $ (1,464,000) - (59,990) - - - - - - - (141,984) - (19,500) - - - - Balance $ 690,707 (1,420,023) 137,587 (60,164) 547,619 264,660 16,485 377,377 417,827 369,381 21 (131,176) 998 164,437 49 22 677 4,929 District 1
Greenbelt Park:

Quimby Fees Earned $ 417,300 $ - - - - - 160,500 256,800 - - - - - - - - - - Interest Allocated $ 9,730 $ - (18,605) (39) 12,147 8,981 5,732 1,514 - - - - - - - - - Balance $ 427,030 $ - (18,605) (39) 12,147 8,981 166,232 258,314 - - - - - - - - - - Sports Park(Sycamore Hills):

Quimby Fees Earned $ 3,150,526 $ - 214,000 1,607,406 387,520 363,800 577,800 Interest Allocated $ (73,329) $ - (122,723) (241) 30,480 14,691 4,464 Park Development Costs $ (260,653) $ (184) - - (8,851) - - - - (19,222) (153) (2,906) (2,781) (26,724) (10,163) (153,996) (30,672) (5,001) Balance $ 2,816,544 $ (184) 91,277 1,607,165 409,149 378,491 582,264 - - (19,222) (153) (2,906) (2,781) (26,724) (10,163) (153,996) (30,672) (5,001) Total District 1 $ 3,243,574 $ (184) $ 72,672 $ 1,607,126 $ 421,296 $ 387,472 $ 748,496 $ 258,314 $ - $ (19,222) $ (153) $ (2,906) $ (2,781) $ (26,724) $ (10,163) $ (153,996) $ (30,672) $ (5,001) District 2
Magnolia Park:

Quimby Fees Received $ 79,490 $ - - 59,990 - - - - - - - - - 19,500 - - - - Interest Allocated $ - $
Playground Equipment $ (59,990) $ - (59,990) Recreation Center Courtyard $ (19,500) $ (19,500) - - - - Balance $ - $
McCarthy Park:

Quimby Fees Earned $ 716,060 $ - - 42,800 - - - - - 192,600 203,300 74,900 74,900 32,100 64,200 - 31,260 - Interest Allocated $ 27,329 $ - (32,389) (69) 19,980 14,772 9,428 4,038 1,386 1,591 261 775 1,224 1,030 863 141 4,296 - Balance $ 743,389 $ - (32,389) 42,731 19,980 14,772 9,428 4,038 1,386 194,191 203,561 75,675 76,124 33,130 65,063 141 35,556 - Total District 2 $ 743,389 $ - $ (32,389) $ 42,731 $ 19,980 $ 14,772 $ 9,428 $ 4,038 $ 1,386 $ 194,191 $ 203,561 $ 75,675 $ 76,124 $ 33,130 $ 65,063 $ 141 $ 35,556 $ - District 3
Baldy View Dog Park:

Quimby Fees Earned $ - $ -
Interest Allocated $ - $ -
Transfer in from Unallocated $ 800,000 $ 800,000 Dog Park Improvements 82339 $ (15,889) $ (15,889) $ 784,111 $ 784,111 $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - Cabrillo Park:

Quimby Fees Earned $ 624,237 $ - - - 55,092 - - - - - - 50,615 74,900 428,000 15,630 - -Interest Allocated $ 25,079 $ - (28,290) (60) 18,470 12,515 7,987 3,421 1,175 1,348 309 1,566 3,062 3,441 135 - - -

City of Upland
Summary of Quimby Fee Activity FY 2007 to FY 2023
As of June 29,2023
Description Total FY 22/23 FY 21/22 FY 20/21 FY 19/20 FY 18/19 FY 17/18 FY 16/17 FY 15/16 FY 14/15 FY 13/14 FY 12/13 FY 11/12 FY 10/11 FY 09/10 FY 08/09 FY 07/08 FY 06/07 Balance $ 649,316 $ - (28,290) (60) 73,562 12,515 7,987 3,421 1,175 1,348 309 52,181 77,962 431,441 15,765 - - - Citrus Park:

Quimby Fees Earned $ 55,092 $ - - - 55,092 Interest Allocated $ (826) $ - (2,364) (5) 1,544 Snackbar replacement#82346 $ (5,755) $ (5,755) Balance $ 48,511 $ (5,755) (2,364) (5) 56,636 Total District 3 $ 1,481,938 $ 778,356 $ (30,655) $ (65) $ 130,198 $ 12,515 $ 7,987 $ 3,421 $ 1,175 $ 1,348 $ 309 $ 52,181 $ 77,962 $431,441 $ 15,765 $ - $ - $ - District 4
9th and Bodenhamer Park
Quimby Fees Earned $ 233,548 $ 137,730 - (87,822) 183,640 Interest Allocated $ 1,240 (3,897) (8) 5,145 Transfer in from Unallocated $ 664,000 $ 664,000 Professional Services-Park Design $ (95,437) (1,968) (93,469) Balance $ 803,352 $ 801,730 (5,864) (181,299) 188,785 Olivedale Park/8th St.Reservoir Park/
Urban Plaza/Downtown Parklets:

Quimby Fees Earned $ 2,232,166 - - - - 119,366 716,196 624,376 459,100 - - - - - - 313,128 - Interest Allocated $ 105,736 (79,891) (170) 53,474 39,537 25,233 10,695 2,222 1,823 172 873 1,872 2,456 3,031 1,381 43,028 - Artificial Turf Instal-Warden Field $ (100,000) - - - - (100,000) Safety Net Warden Field $ (24,937) (24,937) - - - - Hawkins Field Improvements $ (18,891) (11,916) - (6,975) - - Urban Plaza Design/Development $ (139,083) $ (90,853) (14,561) (33,669) Balance $ 2,054,991 $ (90,853) (94,452) (33,839) 53,474 39,537 44,599 726,891 626,598 460,923 172 873 1,872 (34,397) 3,031 (5,594) 356,156 - Memorial Park:

Quimby Fees Earned $ 156,094 $ 55,092 - - 101,002 Quimby Fees Received $ 141,984 - - - - - - - - - 141,984 - - - - - - Interest Allocated $ 1,097 (1,028) (2) 2,127 Rotary Field $ (78,509) (1,040) (52,364) (17,717) (7,388) Purchase Landecena Building $ (141,984) - - - - - - - - - (141,984) - - - - - - Balance $ 78,681 $ 55,092 (2,068) (52,367) 85,411 (7,388) Total District 4 $ 2,937,024 $ 765,969 $ (102,384) $ (267,505) $ 327,671 $ 32,149 $ 44,599 $ 726,891 $ 626,598 $ 460,923 $ 172 $ 873 $ 1,872 $ (34,397) $ 3,031 $ (5,594) $ 356,156 $ - Fund Balance-6/30/2022 $ 9,096,633 $ 124,118 $ 44,832 $ 1,322,123 $ 1,446,763 $ 711,569 $ 826,995 $ 1,370,042 $ 1,046,986 $ 1,006,621 $ 203,910 $ (5,352) $ 154,175 $ 567,888 $ 73,745 $ (159,427) $ 361,717 $ (72)

CITY OF UPLAND

QUIMBY FEE PROJECT IDENTIFICATION
As of October 9,2023
Estimated Estimated Designated
Project Name Status Completion Cost Funds Unallocated Current Balance $690,707
Transfer to Greenbelt Park Planned ($209,271) Transfer to Sierra Vista Park Approved ($57,500) Transfer to Sierra Vista Park Planned ($141,436) Transfer to Baldy View Park Approved ($57,500) Transfer to 13th Street Park Planned ($225,000) Unallocated Totals ($690,707) $690,707
DISTRICT 1 PARKS
Greenbelt Park Current Balance $427,030
Transfer In from Unallocated Planned FY 24/25 $209,271 Netting Planned FY 24/25 ($237,296)
Fencing Planned FY 24/25 ($100,000)
Playground Surfacing Planned FY 24/25 ($50,000) Playground Shade Planned FY 24/25 ($100,000) Picnic Shelter Planned FY 24/25 ($149,005) Greenbelt Park Totals ($636,301) $636,301 San Antonio Park Current Balance $0
Sports Park(Sycamore Hills)Current Balance $2,816,544 Master Plan Approved FY 23/24 ($85,966)
Sports Complex Inactive Unknown ($2,730,578) Sports Park(Sycamore Hills)Totals ($2,816,544) $2,816,544 DISTRICT 2 PARKS
13th Street Reservoir Park Current Balance $0 Transfer in from Unallocated Planned FY 24/25 $225,000 Playground Planned FY 24/25 ($75,000) Basketball Court Resurface/Paint Planned FY 24/25 ($50,000) Security Lighting Planned FY 24/25 ($100,000) 13th Street Reservoir Park Current Balance ($225,000) $225,000 Magnolia Park Current Balance $0

CITY OF UPLAND

QUIMBY FEE PROJECT IDENTIFICATION
As of October 9,2023
Estimated Estimated Designated
Project Name Status Completion Cost Funds McCarthy Park Current Balance $743,389
Sandpit Repurpose Planned FY 25/26 ($88,250) Basketball Court Resurface/Paint Planned FY 25/26 ($50,000) Exercise Area - Replace Planned FY 25/26 ($100,000) Horseshoe Pits- Replace Planned FY 25/26 ($10,000) Restroom Epoxy Active FY 23/24 ($25,000)
Restroom - Partitions, Sinks,Toilets Active FY 23/24 ($25,000) Restrooms- Fixture Installation Active FY 23/24 ($7,500) Playground Replacement and Resurface Planned FY 25/26 ($437,639) McCarthy Park Totals ($743,389) $743,389 Sierra Vista Park Current Balance $0
Transfer in from Unallocated Approved FY 23/24 $57,500 Transfer in from Unallocated Planned FY 24/25 $141,436 Restrooms- Epoxy Active FY 23/24 ($25,000)
Restrooms- Partitions,Toilets,Sinks Active FY 23/24 ($25,000) Restrooms- Fixture Installation Active FY 23/24 ($7,500) Picnic Shelters Planned FY 24/25 ($141,436) Sierra Vista Park Totals ($198,936) $198,936 DISTRICT 3 PARKS
Baldy View Park Current Balance $784,111
Transfer In From Unallocated Approved FY 23/24 $57,500 Restrooms- Epoxy Active FY 23/24 ($25,000)
Restrooms- Partitions,Toilets,Sinks Active FY 23/24 ($25,000) Restrooms- Fixture Installation Active FY 23/24 ($7,500) Irrigation Replacement Active FY 23/24 ($300,000) Dog Park Renovation and Upgrades Active FY 23/24 ($500,000) Baldy View Park Totals ($857,500) $841,611

CITY OF UPLAND

QUIMBY FEE PROJECT IDENTIFICATION
As of October 9,2023
Estimated Estimated Designated
Project Name Status Completion Cost Funds Cabrillo Park Current Balance $649,316
Accessibility Path Planned FY 24/25 ($200,000) Playground Replacement Planned FY 24/25 ($150,000) Playground Resurfacing Planned FY 24/25 ($100,000) Repurpose/Resurface Sandpit Planned FY 24/25 ($50,000) Basketball Court Resurface/Paint Planned FY 24/25 ($50,000) Restroom- Epoxy Active FY 23/24 ($25,000)
Restroom -Toilets, Partitions,Sinks, Fixtures Active FY 23/24 ($25,000) Restrooms- Fixture Installation Active FY 23/24 ($7,500) Water Stations Planned FY 24/25 ($41,816) Cabrillo Park Totals ($649,316) $649,316 Citrus Park Current Balance $48,511
Concessions Stand Roof Replacement Active FY 22/23 ($10,245) Accessibility Path Planned FY 24/25 ($30,766) Restrooms- Fixture Installation Active FY 23/24 ($7,500) Citrus Park Totals ($48,511) $48,511 DISTRICT 4 PARKS
9th and Bodenhamer Park Current Balance $803,352 9th and Bodenhamer Park Creation Planned FY 24/25 ($803,352) 9th and Bodenhamer Park Totals ($803,352) $803,352 Olivedale/8th St. Reservoir Park/Urban
Plaza/Downtown Parklets Current Balance $2,054,991 Picnic Shelters-Olivedale Planned FY 23/24 ($59,380) Playground Replacement-Olivedale Planned FY 23/24 ($320,169) Accessibility Paths Planned FY 23/24 ($40,442) Full Restroom Replacement Planned FY 23/24 ($125,000) Downtown Parklets Project Active FY 23/24 ($450,000) Urban Plaza Park Project Active FY 23/24 ($1,060,000) Olivedale/8th St. Reservoir Park/Urban
Plaza/Downtown Parklets Totals ($2,054,991) $2,054,991 Memorial Park Current Balance $78,681
South Field Renovations Planned FY 23/24 ($78,681) Memorial Park Totals ($78,681) $78,681 Total Projects ($9,112,521) $9,096,631

� �p
4�� 19� CITY UPLAND
�5, _�• "The City of Gracious Living"
C,,tIFOB,S
'• Staff(krctill
DATE: October 9,2023
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:STEPHEN PARKER,CPA,ASSISTANT CITY MANAGER
SUBJECT: RECEIVE THE INFORMATIONAL REPORT ON THE CITY'S FINANCIAL HEALTH WITH

FINANCIAL SCORECARD
RECOMMENDED ACTION:

It is recommended that the City Council receive and file the Financial Health Scorecard prepared by Kosmont Financial Services.

GOAL STATEMENT
The proposed action supports the City's goal of to ensure fiscal stewardship for the City of Upland.

BACKGROUND
City staff engaged the services of a financial advisor to perform an independent third-party assessment of the City of Upland's financial health and financial management practices.

The Financial Scorecard is a financial management tool that evaluates the City's fiscal health and financial management practices, utilizing pre-defined metrics and best practices. The Scorecard is designed to evaluate how well the City utilizes its resources,its ability to meet its current/future financial obligations,deliver expected service levels,and achieve future policy objectives. Executed through a comprehensive review process, the Financial Scorecard rates the City's financial standing and management practices based on 40 select metrics.

These 40 metrics are based on best practices and concepts from industry-leading think tanks, practitioners, and researchers including:
•Rating Agencies—Moody's,Fitch,and S&P •International City/County Management Association(ICMA) •Brooking Institute •Government Finance Officers Association(GFOA) •Truth in Accounting •Build America Mutual(Municipal Bond Insurer) •Rockefeller Institute of Government •Pew Charitable Trust These concepts are combined with the practical insights gained from the advisor's extensive executive government experience.The result is an assessment methodology that is both robust,and practical and easy to understand.

Unlike a Bond Rating, which is heavily weighted by the City's underlying economic and demographic factors and primarily focused on its ability to make its debt service payments, this financial assessment is designed to evaluate how well the City utilizes the resources it has(i.e.,what it does with what is has). Since the City's mandate extends beyond simply making timely debt service payment,the assessment also takes into consideration the City's ability to meet its expected service levels,infrastructure needs,and future policy objectives.

ISSUES AND ANALYSIS
Evaluation Framework
The Financial Scorecard reviews and measures key elements of the Annual Comprehensive Financial Report(with a focus on key elements from the Income Statement and Balance Sheet),the Budget,5-Year CIP,and other key financial documents and policies. This information is used to assess the strength of the City's current financial management practices,evaluating key factors under 4 major categories:

Revenues:Evaluates the City's revenue diversity and vulnerability,as well as user charges and the use of one-time transfers and subsidies.

Expenses: The focus is on controllable as well as independent mandatory cost areas such as labor, pension/OPEB liabilities,bond debt service,and deferred maintenance.Outsourcing or contracting account and potential hidden costs are also considered.

Solvency: Evaluates the City's reserves and working capital requirement, adequacy of reserve policies, trends in the operating budget, and dependencies between the General Fund and Special Funds. The evaluation of solvency provides a clearer picture of whether the City can meet its short-term and long-term obligations,and capacity to weather an economic downturn or other financial risks.

Policies,Plans&Practices: The Scorecard evaluates how well the City's long-term vision aligns with its fiscal policies and practices.It also examines the strength and clarity of the City's strategic framework.

Scorecard Methodology
The Financial Scorecard assigns a rating to each of the 40 metrics. Each metric is assigned a score along with one of four performance categories, with a representative color: Strength (Blue), Stable(Green),Improve (Orange) and Concern(Red),based on the number of points obtained for each metric.

There are a total of 100 points assigned to these metrics,which are organized into the 4 major categories:
• Revenues—20 points
• Expenses—30 points
• Solvency—35 points
• Policies,Plans,&Practices— 15 points
Additionally, the system allows for the assignment of up to 30 extra points, for the utilization of best and/or recommended practices and/or cautionary practices.

The assessment methodology places greater emphasis on factors that the City can control. For this reason,the Revenue category has been allocated 20 points. Since the City has greater and more immediate control over its Expenses, it has been allocated 30 points. The Solvency category is assigned an even greater 35 points, since management and City Council actions(or inactions)have a direct significant impact on the established liquidity and level of reserves.

Finally,Policies,Plans,and Practices,which are assigned 15 points,indicate whether the City's financial management practices have been incorporated into the City's institutional framework and culture.

The results from the Scorecard can be used to chart a course for improving the City's financial future and minimizing its financial vulnerabilities,enabling the City to make strategically sound and effective decisions that ensure its long- term fiscal health and stability.

FINANCIAL SCORECARD

CITY OF UPLAND

CONCERN IMPROVE STABLE STRENGTH

REVENUES
Revenue Diversity 4.0 6.0 Stable
Revenue Volatility 5.0 8.0 Improve
Self-Funding Charges 1.3 2.0 Stable
Transfers &Subsidies 3.5 4.0 Strength
Stable 6& Under 6- 11 11 - 16 16-18 13.8 20.0 Stable Additional Points 1.5 -

EXPENSES
Staffing Patterns 5.5 8.0 Stable
Retirement Costs 5.3 8.0 Stable
Long-Term Debt 6.3 8.0 Strength
Capital Needs 4.9 6.0 Strength
Stable 8& Under 8 -16 16-24 24-32 21.9 30.0 Stable Additional Points 5.0 -

SOLVENCY
Liquidity 6.5 10.0 Strength
Reserves 5.0 10.0 Stable
Operating Budget 8.8 10.0 Stable
Liability Management 3.8 5.0 Stable
Improve 10& Under 10 -20 20-30 30-40 24.0 35.0 Stable Additional Points7 2.5 -

POLICIES& PRACTICES
Financial Policies 3.8 4.0 Strength
Financial Plans 2.2 4.0 Stable
Financial Practices 1.5 7.0 Stable
Improve 4& Under 4-6 6-8 8-10 7.5 15.0 Stable Additional Points -
BASELINE 28 28-53 54-80 80-100 67.1 100.0 Stable Additional Points 10.0
ADJUSTED 28 28-53 54-80 80-100 77.1 100.0 Stable Results
The City received a baseline score of 67 points,which is considered"Stable". The City received a"Stable"or "Strength"in every sub-category,except for Revenue Volatility.

The City has a high concentration of its sales tax revenues,which are derived from business in Building Materials and Service Stations. These types of businesses are both susceptible to volatility/changes in downward economic cycles. Consequently,the City received a score in the"Improve"category for Revenue Volatility. Generating sales

tax from these types of businesses can be offset by maintaining a higher level of reserves to offset a potential revenue downturn.

The City received an additional 10 points for best and recommended practices, resulting in an overall score of 77 points. The City received extra points for its recent Water& Sewer fund rate increases,incorporating an automatic CPI provision in its Waste Hauler contract, and demonstrating a clear understanding of the value of subsidies in its Parks&Rec fees. The City also received extra points for implementing variable and part-time staffing in its Building Dept. and Library and Parks &Rec Department, as well as establishing limits for vacation and sick leave accruals and offering sick/vacation leave pay-outs.Additionally,the City received points for establishing a 115 Trust to help control pension costs and having employees pay a portion of the City's Normal Costs.

Finally, the City received a strong score and additional points for its approach to Liability Management, which involved overseeing a dramatic improvement in its Workers Compensation claims processing rates and establishing a budget tracking process for liability claims.

Workers Compensation - Staff dramatically decreased its workers compensation claims; over the past 4 years the number of claims decreased by nearly 30%,the closure ratio increased from 86%to 123%, and lowered the average days lag from 8 to 5 days (an industry benchmark). As a consequence, the potential outstanding claims decreased by 85% (from $1.7 million to $250,000) with a 90% reduction in annual payouts(from$380,000 to$35,000). Finally,the City's litigation ratio for workers compensation claims went down from 34%to 3.0%.

Liability Management—The City has taken an active role in addressing its liability claims as well,resulting in a 31%reduction in the reserves set aside for potential pay-outs from$3.4 million to$2.4 million.

City management also received additional points for having a Health & Wellness program, and for senior staff's participation in JPIA meeting and regular trainings with Carl Warren(third party administrator).However,the City lost a point due to the failure of the recent sales tax measure.

The 10 additional points brings the City's total score to 77 points,placing it in the high stable category.

Assessment
Overall,the Financial Scorecard rated the City"Stable"in terms of its financial position,with a generally positive future outlook.

The City has a stable revenue base, with a good balance of sales tax&property tax. Albeit,there is some concern regarding the high concentration of Top 10 sales tax generators in the building &materials and gas stations. This concern can easily be addressed by setting aside additional reserves (based on 2009 decline in sales tax revenues) for the next economic downturn.

The City has low levels of debt and has taken significant steps to address its pension costs. More importantly,it has maintained consistent staffing levels and taken steps to manage its expenses(e.g.,sick/vacation hour caps and annual pay-outs).

The City has many good management "best practices" in place such as, user fees study, variable staffing, CPI- adjusted fees, vacation/sick leave caps & pay-outs, and creatively addressed pension costs with formal policies.

Moreover,there are no issues with special revenue funds and/or grant programs.

Potential future concerns may center around meeting RHNA(affordable housing)requirements and going through the Surplus Land Act(SLA)process.

Recommendations
The City is overall in a stable financial condition and has benefitted from a number of steps taken in the past to bolster its financial condition. However,there are few areas of improvement that the report highlights. 5-Year CIP-Future challenges to the City will likely center around the ability to fund the renewal and replacement cost for existing infrastructure. For this reason,the consultant's primary recommendation is on the 5-Year Capital Improvement Plan(CIP). The report recommends that the City develop a more robust and complete 5-Year CIP.

This process should include the City Council's prioritization of future capital improvement projects and a realistic

assessment of the City's internal(staffing)capacity to build all the projects on the list in the expected timeline.

Reserve for Economic Uncertainty-The only major sub-area for"improvement"was in the revenue volatility. The City has a high concentration of sales taxes generated from home & building materials and services stations.

Although the City has established a 25% reserve level for economic uncertainty, this figure is not based on a particular event or rationale. The GFOA recommends that a reserve for economic uncertainty be established based on past historical trends—such as,the revenue downturn during the Great Recession in 2008.

Considerations -There are a few other areas that this report mentioned. Although the consultant did not provide specific recommendations,they highlighted areas to focus on in the future,for the City's consideration. These items include:
• Adopting formal policies&practices for City Council's review of liability management issues • Making progress toward RHNA and addressing Surplus Land Act • Focus of future economic development projects should be real-estate and transportation-based • Continue to monitor pension&OPEB costs.
• Consider Citizens Budget&IT Management Plan

ENVIRONMENTAL DETERMINATION
The proposed action is the adoption of an investment policy,and not subject to the California Environmental Quality Act(CEQA). Section 15378 of the CEQA Guidelines defines a project subject to CEQA. The proposed action is not included within the definition of a"project"and thus is exempt.

FISCAL IMPACTS
There is no fiscal impact associated with this action.

ALTERNATIVES
Provide alternative direction to staff.

CEQA:Not a Project

g lid
Financial Scorecard
Fiscal Health Assessment Tool
kosmonf

Fiscal Assessment Tool
Transform Data into Financial Management Information
Key Metrics & Best Practices
• Fitch/Moody's/ S&P
• ICMA
• Pew Trust
• LAEDC/Brookings Institute
• UFI

FISCAL HEALTH (TODAY)
• Ability to meet all financial obligations
• Provide desired service levels & meet policy objectives • Management & Policy Leaders Decisions: impact on financial position
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Fiscal Health & Areas of Vulnerabilities
BOND RATING FISCAL HEALTH
Shared Metrics
• Level of Service
Ability to • Financial Metrics • Pay Debt Service Pay Debt E> • Financial Resources • Payroll Service • Demographic Conditions • Retirement • Management Practices • Policy Objectives
• Political Will • Capital Projects
• Formal Policies & Process ECONOMIC
• Financial Forecasting <::

RESILIENCY
• Best Practices
What Resources What You Do with
Are Available What You Have
Bond rating —strong indicator (highly correlated), but it's a single letter grade.

Does not provide practical insights & recommendations 1kosmon financial services -- • - 15

Fiscal Scorecard Framework

1. Revenues
• Limited control
• Understanding Drivers Revenues

2. Expenses
• Control over majority over containment Expenses • Level of Service

3. Solvency
• Direct control of financial position Solvency • Strength/weaknesses of management practices

4. Policies, Plans & Practices
• Do your financial policies and practices support your Policy, Plans &
budget/financial goals and align with your strategic Practices objectives.
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SCO R ECAR D
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Scorecard Methodology
Improvement Stable
Area of potential concern Area poses limited risk if that can be reasonably maintained in the current state. mitigated with corrective Recommendations "nice to haves" action or adjustments to
long-term plans.

Concern Strength
Area of serious Area of fiscal
concern; urgent strength and
action required to minimal risk;
avoid short and focus should
long-term be to maintain
adverse impacts position.

Quantitative Assessment Qualitative Assessment o Balance Sheet o Financial Management Practices o Income Statement o Strategic Alignment
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4 Levels 4 Areas - 40 subcategories
1 . Revenues - 20 Revenues Strength (Green) Expenses

2. Expenses - 30
Stable (Blue)

3. Solvency - 35
Improve (Orange)

4. Policies, Plans & policie
Practices - 15 Concern (Red)
Plans = Solvency
Practic -
Quantitative Assessment Qualitative Assessment
o Balance Sheet o Financial Management Practices o Income Statement o Strategic Alignment
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CONCERN IMPROVE STABLE STRENGTH

REVENUES
S co re c a rd Revenue Diversity 4.0 6.0 Stable Revenue Volatility 5.0 8.0 Improve
Self-Funding Charges 1.3 2.0 Stable
Transfers &Subsidies 3.5 4.0 Strength
Stable 6&Under 6- 11 11 - 16 16-18 13.8 20.0 Stable Additional Points 1.5 -

EXPENSES
Staffing Patterns 5.5 8.0 Stable
Retirement Costs 5.3 8.0 Stable
Long-Term Debt 6.3 8.0 Strength
Capital Needs 4.9 6.0 Strength
Stable 8&Under 8-16 16-24 24-32 21.9 30.0 Stable Additional Points 6.0 -

SOLVENCY
Liquidity 6.5 10.0 Strength
Reserves 5.0 10.0 Stable
Operating Budget 8.8 10.0 Stable
Liability Management 3.8 5.0 Stable
Improve 10&Under 10-20 20-30 30-40 24.0 35.0 Stable Additional Points 2.5 -

POLICIES&PRACTICES
Financial Policies 3.8 4.0 Strength
Financial Plans 2.2 4.0 Stable
Financial Practices 1.5 7.0 Stable
Improve 4&Under 4-6 6-8 8-10 7.5 15.0 Stable Additional Points -
BASELINE 28 28-53 54-80 80-100 67.1 100.0 Stable Additional Points 10.0
ADJUSTED 28 28-53 54-80 80-100 77.1 100.0 Stable 15 kosmon
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kosREVENUES
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Revenues
CONCERN IMPROVE STABLE STRENGTH Points Max

1. REVENUE DIVERSITY
Top 10 Property Tax 2.0 2.0 Strength Top 10 Sales Tax kiMPF 0.8 2.0 Improve Special Revenue Funds 1.3 2.0 Stable

1.50 1.5 - 3.0 3.0 - 4.5 4.5+ 4.00 6.0 Stable

2. REVENUE VOLATILITY
Sales Tax Volatility 1.0 2.0 Improve Revenue Elasticity 4.0 6.0 Stable

2.00 1.5 - 3.0 3.0 - 4.5 4.5+ 5.0 8.0 Improve

3. SELF-FUNDING REVENUES
User Charge Coverage 1.3 2.0 Stable

0.50 0.5 - 1.0 1.0 - 1.5 1.5+ 1.3 2.0 Stable

4. TRANSFERS & SUBSIDIES
1-Time as % Operating 1.75 2.0 Strength Transfer into GF jah. 1.75 2.0 Strength

1.00 1.0 -2.0 2.0-3.0 3.0+ 3.50 4.0 Strength CONCERN IMPROV: STABLE STRENGTH
5 & Under 5 - 11 11I I 16-18 13.8 20.0 Stable Bonus Points 1.5
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Revenue Diversity — PropertyTax
Stable - Top 10 less than 10%
2022 Amount % 2013 Name Amount % 1 Colonies-Pacific LLC $ 166,876,323 1.5% 1 Colonies-Pacific LLC $ 88,401,764 1.2% 2 College Park Apartment Homes LP 62,515,737 0.6% College Park Apartment Homes LP 57,451,172 0.9% 3 Benson Owner LLC 50,394,737 0.5% 3 Granite Sr Woodlane LLC 42,918,879 0.7% 4 Lucas Upland LLC 49,724,867 0.5% 4 Rancho Monte Vista Apartment Home 40,015,514 0.6% 5 MG Stoneridge Village Grove LLC 47,565,361 0.4% 5 CT Retail Properties Finance I I LLC 38,210,074 0.5% 6 Rancho Monte Vista Apartment Homes 46,126,123 0.4% 6 WNG Mountain Springs GP 34,955,689 0.5% 7 CT Retail Properties Finance I I LLC 44,339,086 0.4% 7 Koll Per College Business Park 34,726,001 0.5% 8 WNG Mountain Springs GP 40,562,688 0.4% 8 Bill and May Matreyek Trust 31,446,614 0.5% 9 College Business Park LLC 37,949,121 0.4% 9 NU-1698 Apartments 31,204,116 0.4% 10 Dee Matreyek-Kurth Non Exempt Trust 37,537,476 0.3% 10 Holiday Rock Company 30,790,476 0.4% TOTAL $ 583,591,519 5.4% TOTAL $ 430,120,299 6.1% CAG R
TOTAL ASSESSED VALUE FY21-22 $ 10,815,869,000 4.3% TOTAL ASSESSED VALUE $ 7,075,210,000 smon '- - 15
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Revenue Diversity — Sales Tax
Top 10 Sales Tax Producers - Improve
Top 10 Sales Tax
State Sates Tax Category
Building Material & Garden Equipment 11.27%
Building Material & Garden Equipment 7.84%
Motor Vehicle and Parts Dealers 6.68%
Motor Vehicle and Parts Dealers 3. 18%
General Merchandise Stores 3. 14%
General Merchandise Stores 2.98%
Motor Vehicle and Parts Dealers 2.61%
Building Material & Garden Equipment 2.32%
Gasoline Stations 1.87%
Gasoline Stations 1.51%
Top 10 % 43.4%
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Sales Tax by Industry
Sales Tax by HdL Major Industry Group Top 10 Sales Tax Producers HdL 2022 • Building Materials Major Industry Group % Amount 4 • Service Stations
1 Building Materials 24% $ 1,951
40 2 Service Stations 22% 1,792
• Quick Serve Restuarants 3 Quick Serve Restuarants 13% 1,055 • Casual Dining 4 Casual Dining 10% 835 • Specialty Stores 5 Specialty Stores 7% 573 • Family Apparel 6 Family Apparel 7% 546 • Grocery Stores 7 Grocery Stores 5% 430 8 Sporting Goods 4% 357
• Sporting Goods 9 Fast Casual Restaurants 4% 303 Fast Casual Restaurants 10 Auto Repair Shops 2% 143 • Auto Repair Shops 11 Convenience Store Liquor 2% 160 • Convenience Store Liquor 100% $ 8,143
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Sales Tax Volatility
Improve
UPLAND State of CA
Sales Tax Category StDev % Dist. Score StDev % Dist. Score Motor Vehicle and Parts Dealers 7.9% 8.3% 0.7% 7.7% 11.5% 0.9% Home Furnishings and Appliance Stores 13.3% 1.1% 0.1% 6.6% 3.7% 0.2% Building Material & Garden Equipment 7.8% 11.4% 0.9% 4.7% 5.5% 0.3% Food and Beverage Stores 6.4% 4.5% 0.3% 1.5% 3.6% 0.1% Gasoline Stations 26.5% 11.1% 2.9% 24.6% 7.5% 1.8% Clothing and Clothing Accessories Stores 26.4% 4.9% 1.3% 20.9% 5.2% 1.1% General Merchandise Stores 3.3% 7.6% 0.3% 5.8% 7.3% 0.4% Food Services and Drinking Places 9.8% 13.5% 1.3% 19.7% 10.8% 2.1% Other Retail Group 12.1% 9.4% 1.1% 16.7% 12.6% 2.1% Total Retail and Food Services 6.9% 0.0% 0.0% 8.0% 0.0% 0.0% All Other Outlets 26.0% 28.1% 7.3% 8.9% 32.4% 2.9% Total All Outlets 10.3% 100% 16.2% 8.0% 100% 11.9% Pew Charitable Trust
15 kosmon
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Revenue Elasticity
Stable - LAECD / Brookings
Category Amount % Type
1 Property Tax (VLF) $19,089,687 40.5% Inelastic 2 Business License 1,158,797 2.5% High
2 Sales & Use Taxes 18,469,789 39.1% Highest 17,864,847 38% Highest 3 Franchise Tax 1,377,349 2.9% Inelastic 4,133,070 9% High 4 Other Taxes 1,078,121 2.3% Unit 4,723,968 10% Unit 5 License & Permits 2,064,096 4.4% High 20,467,036 43% Inelastic 6 Charge for Services 2,745,996 5.8% Unit
7 Fines & Penalties 600,186 1.3% High $47,188,921 100% 8 Investment Income (604,942) -1.3% Highest 9 Rental Income 566,426 1.2% Unit
10 Intergovernmental 333,425 0.7% Unit 11 Other Revenues 309,991 0.7% High
$47,188,921 100%
Special Revenue Funding
Stable — 8-12% of overall budget
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User Fees & Charges
Stable
Revenue Charge Coverage (ICMA)
• Consistent operating surplus without 1-time revenues Transfers
Strength
5-Year Trend Analysis of Operating Results (ICMA)
• Consistent operating surplus without 1-time revenues • Consistent operating surplus without transfers
• Transfers made for capital costs / not operating costs • Transfers made in 2013 & 2014 — stable operating performance since then kosmon • - 15
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Additional Points

1.5 Points
Revenue Diversity & Volatility
• Teeter Plan Participation
• Cannabis Tax
• Employer Concentration: single more than 10% / top 10 more than 30% • Reliance of Single Source of Revenue or Sector
• Revenue Capacity — ability to raise Sales Tax Rate (Failure to pass Measure L 2022) -1
• Sunset Date for Tax Measures
User Charge Coverage
• Annual Automatic CPI Adjustments (Solid Waste Contract) • Consistent Enterprise Fund Increases
• Knowledge of Value of Subsidy
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EXPENSES
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Expenses
CONCERN , IMPROVE STABLE STRENGTH Score Max

1. STAFFING PATTERNS
Employees Per Capita 1.50 2.0 Stable Labor Cost Trend 1.50 2.0 Strength
5-Year Expenditure Growth 1.25 2.0 Stable
10-Year Expenditure Growth 1.25 2.0 Stable

2.75 2.75-5.50 5.50-8.25 8.25+ 5.50 8.0 Stable

2. RETIREMENT COSTS
Pension Funding Levels 2.00 2.0 Stable UAL Payments Average Life 0.83 1.0 Strength Affordability of Pension Costs 0.75 2.0 Improve OPEB Benefits 0.75 1.0 Stable
OPEB Funding Status 0.25 1.0 Concern
OPEB Annual Payments 0.75 1.0 Stable

2.00 2.0 -4.0 4.0-6.0 6.0+ 5.33 8.0 Stable

3. LONG-TERM DEBT
Debt Service Burden 2.25 3.0 Strength
Bond Debt Service Avg. Life 2.50 3.0 Strength Debt Service Flexibility 1.50 2.0 Stable

2.00 2.0 -4.0 4.0- 6.0 6.0+ 6.25 8.0 Strength

4. CAPITAL NEEDS
GF Replacement Costs = Dep. 1.60 2.0 Strength Enterprise Replace= Dep. 1.75 2.0 Strength Funding From Other Sources 1.50 2.0 Strength

1.25 1.25-2.5 2.5-3.75 3.75+ 4.85 6.0 Strength Additional Points

CONCERN IMPROVE STABLE STRENGTH
8 & Under 8-16 16-24 24-32 21.93 30.0 Stable Bonus Points 6.00

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Labor Cost Trends
Population per Employee Stable
10-Year Labor Cost Trend -I Strength
State Controller Data
CAFR Statistical Section
Total # Avg.

Population Fire Total A Per Wages Employees Comp.

Tot
al Capita
1 2012 25,061,102 450 55,691
2012 74,907 50 290 240 313
2 2013 24,630,454 452 54,492
2013 75,147 49 282 233 323
3 2014 24,079,525 470 51,233
2014 75,074 49 280 231 325
4 2015 23,357,724 418 55,880
2015 75,774 49 274 225 338
2016 24,726,725 406 60,903
2016 76,790 49 273 224 344
6 2017 22,363,257 360 62,120
2017 77,017 49 224 175 441 7 2018 17,782,710 319 55,745 2018 78,481 232 232 339 8 2019 18,810,304 333 56,487 2019 78,814 239 239 330 9 2020 19,524,292 321 60,823 2020 78,513 243 243 324
10 2021 20,140,755 312 64,554
2021 79,139 251 251 315
Growth 13% -2% 16%
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Linancial sceviccs

Expenditure Growth vs MCI
5-Year Growth vs Municipal Cost Index (MCI) Stable 16% vs 24% MCI
10-Year Growth vs Municipal Cost Index (MCI) Stable 26% vs 36% MCI
Municipal General Fund Fire 54% of City Adj.

Cost Index Expenses Property Tax Expenses 1 2013 229.4 39,787,351 39,787,351
2 2014 234.8 39,307,766 39,307,766
3 2015 233.1 39,408,003 39,408,003 Fire Contract based on
4 2016 235.3 42,325,593 42,325,593 Growth of AV, 5 2017 242.0 45,772,713 45,772,713 which exceeds 6 2018 250.9 36,412,734 6,771,580 43,184,314 CPI 7 2019 253.3 35,940,837 7,142,562 43,083,399 8 2020 253.2 38,058,983 7,485,884 45,544,867 9 2021 278.1 38,144,627 7,901,678 46,046,305 io 2022 312.1 41,922,864 8,232,995 50,155,859 5-Yr 24.4% 15.1% 21.6% 16.1%
10-Yr 36.0% 26.1%
mon '-- - - 15
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Linancial sceviccs

Retirement Costs
Pension Funding Level Stable
(FY 21 = 74% after ADPs = 80%)
Average Life UAL Payments Strength
(FY 22 = 8.3 years)
Affordability of Pension Costs Improve
UAL + Normal Costs = 36% of Payroll
OPEB Benefits Stable
(Requires 10 years service / capped at $200 monthly subsidy) OPEB Funding Status Concern
S14 Million Liability PARS Trust— 11% funded
Annual OPEB Payments Stable
"Pay-Go" + ADC
-- - • • - 1522
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Linancial scviccs

Projected UAL
FY22 Projected Combined UAL Payments
14 0
• • •
12 • • • • • • • • • . • • • • • • • • •• •• •• •• • • • •
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0 •
•
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•
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1 June 30, 2021 FY22 Added UAL • • June 30, 2020 -- •• - 15
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Linancial scviccs

Long-Term Debt
Debt Service Burden (Less than 5% Operating Expenses) Strength Debt Service Average Life (7.5 years) Strength Debt Service Flexibility Stable
Upland: General Fund Long-Term Debt
$3,000,000
$2,500,000 •Water Investment Sewer Investment • CREBS • Energy • Housing $2,000,000
$1,500,000
$1,000,000
$500,000
$0

O ,O ,O ,O ,O ,O ,O ,O ,O ,O ,O ,O ,O ,O ,LO ,LO kosmon
iinaac�ai services -- - • - 15

Long-Term Debt
Water Sewer
Energy Housing CREBS Combined Average Life Investment Investment
1 2023 245,292 406,607 1,130,048 358,745 250,371 1,739,169 1,739,169 2 2024 240,706 386,370 1,142,872 362,817 261,571 1,767,259 3,534,518 3 2025 238,534 365,499 1,141,120 362,260 273,16 1,776,545 5,329,636 4 2026 238,352 343,974 1,144,032 363,185 285,175 1,792,392 7,169,566 5 2027 239,822 321,774 1,141,608 362,415 297,613 p. 1,801,636 9,008,182 6 2028 244,352 293,574 1,143,848 363,126 303,162 1,810,137 10,860,820 7 2029 248,828 265,181 1,145,704 363,716 321,538 1,830,958 12,816,706 8 2030 250,908 235,937 1,142,224 362,611 343,858 1,848,693 14,789,545 9 2031 252,628 205,815 1,143,408 362,987 355,218 1,861,613 16,754,517 10 2032 253,988 174,789 1,144,208 363,241 365,810 N. 1,873,259 18,732,590 11 2033 129,442 142,833 1,144,624 363,373 522,754 2,030,751 22,338,262 12 2034 - 109,918 1,144,656 363,383 545,666 2,053,705 24,644,463 13 2035 - 76,016 1,144,304 363,271 562,138 2,069,713 26,906,275 14 2036 - 41,096 1,143,568 363,037 557,650 2,064,256 28,899,582 15 2037 - 5,129 1,142,448 362,682 567,298 2,072,428 31,086,424 16 2038 - - 1,145,896 363,777 314,104 1,823,777 29,180,427 $ 2,582,849 $ 3,374,513 $18,284,568 ; 5,804,625 $ 6,127,099 $ 30,216,292 11.0 $ 1,974,288 $13,553,573 $14,905,000 4,731,746 $ 4,299,80' $ 23,936,551 F
II
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iinaac�ai services

Long-Term Debt
Upland: General Fund Long-Term Debt
$3,000,000
$2,500,000 • Water Investment • Sewer Investment • CREBS • Housing • Energy $2,000,000
$1,500,000
$1,000,000
$500,000
$0
eti ti� ti�0 tit ti� ti 3 3ti 3ti 3 1P4 0 0 0 ,y0 ,LO ,ti0 ,ti0 ,ti ,y0 ,ti0 1, ,y0 ,y0 ,ti0 ,y0 - 15
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i� a��ai s�«���s

Capital Needs
Infrastructure Replacement (General Fund) Strength • Annual Depreciation = $8.2 Million
• Inflation Adjusted Depreciation = $18.6 Million
• Current Year CP = $17.0 Million
Infrastructure Replacement (Enterprise Fund) Strength • Annual Depreciation = $3.0 Million
• Inflation Adjusted Depreciation = $6.8 Million
• Current Year CP = $17.7 Million
Capital Project Funding from Other Sources Strength • Enterprise Funds leveraged to address UAL
• Measure I funds major part of CIP
- - - 15
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financial services

Additional Points - Expenses

6.0 Points
Staffing Patterns
Variable Staffing for Building / Inspection Services
Variable Staffing for Library Services and Parks & Rec
• Annual Leave Limits (500 Hours)
Vacation & Sick Leave Payouts
Retirement Costs
115 Trust / Pension Stabilization Fund
• Employees Pay Share of Normal Costs or UAL
• Pay Employee Share of Costs (EMPC)
Capital Needs
• CIP-Adjustment Maintenance District
• Annual CIP exceeds Internal Capacity
• Streetlight Replacement Fund
• Updated AB1600 Policy for DIFs
1 -- •- - 15
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SOLVENCY
-- • - - 15
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Solvency
CONCERN IMPROVE STABLE STRENGTH Score Max

1. WORKING CAPITAL/ LIQUIDITY
Days Cash /% Working Capital 5.0 8.0 Stable Taxpayer Burden/ Surplus 1.5 2.0 Stable

3.0 3.0 - 6.0 6.0 - 9.0 9.0+ 6.5 10.0 Strength

2. RESERVES
Revenue Volatility 3.0 6.0 Stable Emergency Events 2.0 4.0 Stable

3.0 3.0 - 6.0 6.0 - 9.0 9.0+ 5.0 10.0 Stable

3. OPERATING BUDGET
General Fund 2.5 3.0 Strength
Lemonade Stand Rule 1.0 3.0 Improve
Enterprise Fund 3.0 2.0 Strength
Special Revenue Funds 2.25 2.0 Strength

3.0 3.0 - 6.0 6.0 - 9.0 9.0+ 8.8 10.0 Stable

4. LIABILITY MANAGEMENT
Liability Management 1.75 2.5 Stable
Workers Compensation 2.00 2.5 Strength

3.8 5.0 Improve
CONCERN mILVIPROVE STABLE STRENGTH
10 & Under 10 - 20 20-30 30-40 24.0 35.0 Stable Bonus Points 2.5
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Linancial sceviccs

WorkingCapital - 6 Million

WORKING CAPITAL REQUIREMENT
Cumulative Cash Balance $8.9
• .
.s $8 • •
• • $6.5
$ .
6 1 .
$4 $31 iiii I .7
$
• 1 I
$2 F
•
• $1 . 1 . • 1
$0 -$1.1 •
• -$2.4 .
- 2
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.-$3.7 -$4.7 • •
_$4 • • -$4.8 • •
•
'� • -$5.9 . •
• .
-$6 •
July Aug Sep Oct Nov Dec Jan Feb Mar Apr Ma' - - •' - 15
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iinaac�ai services

Reserves
Working Capital TBD
175 Days Cash on Hand / working Capital Requirement not measured Revenue Volatility Stable
Reserves met 25% Target Level, but not based on revenue volatility Emergency Events Stable
$1.0 Million set aside, but no rationale or published guidelines for use Taxpayer Burden/Surplus (Truth in Accounting) Stable Avg. $141 per capita. General Fund Negative / Enterprise Funds Positive -- ••• - 15
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Operating Budget
General Fund Operating Surplus / (Deficit) Strength Consistent surpluses: 9 years positive net Income w/o transfers Lemonade Stand Rule Improve
Net Income 41% of Inflation-Adjust Annual Depreciation _ - III
LeMONA E
Enterprise Fund Operating Surplus / (Deficit) Strength Water Fund Strong Operating Performance / Sewer Fund not as strong Special Revenue Fund Operating Surplus / (Deficit) Strength Only a couple special revenue funds had negative fund balances (timing) -- - •• - 15
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Linancial scviccs

Liability Management
Update

LiabilityManagement
Liability Management Stable
Cost/benefit analysis framework
Should share process (matrix) with council
Workers Compensation Strength
Significant Improvement since 2020: 100%+ closure rate & 3% Litigation Rate (30% previously) TD & MD (4850 pay) from $500K to $35K
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LiabilityManagement
- - • - 15
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Worker's Compensation
- - •- - 15
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Additional Points - Solvency

1.5 points
Operating Results
Documented Inter-Fund Loan Repayment Terms
• Negative Fund Balances (not due to timing)
• Loss of Funding due to Grant Compliance
Liability Management
- Offering Employee Health & Wellness Programs
• Senior Management & Finance actively participates in JPIA meetings • Finance actively participates in claims cost/benefit analysis • Regular training from TPA
• Use predictive analytics for Workers Comp Claims kosmon
iinaac�ai services -- - 15

POLICIES , PLANS &

PRACTICES

Policies Plans & Practices

1. Financial Policies
• Reverse Policy
• Debt Management & Investment
• Pension Funding Policy

2. Financial Plan
• City-Wide Strategic Plan
• 5-Year CIP
• Housing Element

3. Financial Practices
• Budget Practices
• Financial Decision-Making
• RHNA / Surplus Land Act
• Long-Term Forecast & Financial Assessment
- -- • - 15
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Policies Plans & Practices
CONCERN MPROVE STABLE STRENGTH Score Max

1. FINANCIAL POLICIES
Reserve Policy 1.80 2.0 Strength Debt & Investment 0.50 0.5 Stable Pension Funding Policy 1.50 1.5 Strength

1.00 1.0 -2.0 2.0-3.0 3.0+ 3.80 4.0 Strength

2. FINANCIAL PLANS
City-wide Strategic Plan 0.67 1.0 Stable 5-Year Capital Improvement Plan 0.50 2.0 Concern Housing Element 1.00 1.0 Strength

1.00 0.875-1.5 1.75-2.625 2.625+ 2.17 4.0 Stable

3. FINANCIAL PRACTICES
Budgeting Practices 0.25 1.0 Improve Financial Decision-Making 0.25 1.0 Improve RHNA/ Surplus Land Act 0.00 3.0 Concern Forecasting & Fiscal Assessment 1.00 2.0 Stable

1.750 0.875-1.5 1.75-2.625 2.625+ 1.50 7.0 Stable CONCERN IMPROVE STABLE STRENGTH
4 & Under 4 -6 6-8 8-10 7.47 15.0 Improve Bonus Points 0.00 3.5
-- •' - 15
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Additional Points
0 Points
Financial Plan
• IT Management Plan
Financial Practices
• Systematic and periodic review of risks & liability/claims • Annual or regular update with rating agencies
• Simple and Clear Budget Document / Citizens Budget • Utilization of EIFDs
• Leverage of TOD monies
-- •• - 15
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Linancial scviccs

SUMMARY ASSESSMENT
& RECOMMENDATIONS

Conclusion

REVENUES
• City has diverse revenue & employment
• Concentration of Top 10 Sales Tax Producers
• Sales Tax Volatility Score higher than State Avg: 16.2% vs 11.9% • Consistent funding from special revenue programs/grants • Limited reliance on Transfers & 1-Time Revenues
• Master Fee Schedule / Water Rate Study / Solid Waste (20-with CPI)

EXPENSES
• City has maintained stable # workforce & expenditure growth • Part-time & variable staffing for Building, Library & Park Services • Vacation limits & payouts
• Limited Long-Term Debt
• Creatively addressed pension costs
• OPEB 10% funded
• Employees pay share of City's Normal Costs
FA • Annual Capital Replacement Costs greater than Annual Depreciation kosmon - 15
Linancial scviccs

Conclusion ( continued

SOLVENCY
• City meet 25% reserve target (175 days cash)
• $1 Million Emergency reserves
• Lemonade Stand Rule: Net Income = Inflation-Adjusted Annual Depreciation
• Enterprise Funds & Special Revenues Funds are stable • Liability Management could use systematic financial approach

POLICIES, PLANS & PRACTICES
• Good reserve and pension funding policies adopted • 5-Year Forecast + Strategic plan
• Housing Element adopted — but need progress toward RHNA • 3-Year CIP
kosmon - -- - 15
iinaac�ai services

Summary Assessment
• Overall stable financial position with positive future outlook. • City has stable revenue base: balance of sales tax & property tax o Top 10 sales tax (building & materials) & gas stations • Consistent staffing and managed expense control
• Low levels of debt and managed pension costs
• Strong Reserve Policy - Economic Uncertainty fully-funded (22.5%) o 50% applied to Pension Stabilization Fund
• City has many strong management "best practices" in place:
o User fees study, variable staffing, CPI-adjusted fees, vacation/sick leave caps & pay- outs, creatively addressed pension costs with formal policies • No issues with special revenue funds and/or grant programs. - 15
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Recommendations
• Establish Reserves: Working Capital ($6 Million) + Revenue Decline (2008 Recession)
• Adopt policies & practices for liability management for City Council • Develop comprehensive 5-Year CIP
o Prioritization of Projects in CIP
o Realistic assessment of internal capacity
o ARPA $15.2 Million
• Challenge is future capital renewal & replacement. Need to keep pace with inflation-adjusted depreciation "Lemonade Stand Rule" • Housing element adopted — need to make progress toward RHNA o Future of economic development will be real-estate and transportation based • Continue to monitor pension & OPEB costs
• Consider Citizens Budget & IT Management Plan
• Regular conversations with rating agencies
- 15
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Linancial sceviccs

Julio Morales
Senior Managing Director
[email protected]
626-298-9583
Julio has nearly thirty years of working in the areas of public and corporate finance, city management, municipal budgeting and financial leadership. He is a MSRB Municipal Advisor Qualified Representative (Series 50).

He served as the City Manager and Finance Director for the City of Huntington Park and the Finance Director for the City of El Monte. He assisted both cities with the resolution of their "structural deficits".

Most recently, Julio worked for the Department of the Treasury's Office of Technical Assistance (OTA), providing financial advice to the Treasurer of Paraguay, helping to streamline and automate their operations. Mr. Morales also has experience in public and corporate finance, having served as an investment banker with Bank of America, a financial advisor at PFM & Fieldman-Rolapp, derivative/ GIC for Transamerica, and managed the debt for the City of Oakland.

Julio earned his undergraduate degree from the University of Michigan, a Master of Public Policy (MPP) from the Harvard Kennedy School of Government, and an MBA from UCLA, where he was a Dean's Fellowship Recipient.
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