Agenda packet — Upland City Council, March 10, 2025 (part 1 of 2)

° Up CIo�d UPLAND
fir:.A % * "The City of Gracious Uvula '

EETING OF THE CITY COUNCIL
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Bill Velto,Mayor
Rudy Zuniga, Mayor Pro Tern-District 4 Michael Blay, City Manager James Breitling, Couucilmember• District 2 Stephen P. Deitsch,City Attorney Carlos A.Garcia,Couucilmember- District 3 Keri Johnson,City Clerk Shannan Maust,Councilmember-District 1
Monday, March 10, 2025
Open session begins at 6:00 p.m.

City Council Chamber
City Hall, 460 N. Euclid Avenue
Residents may observe the City Council meetings remotely via livestream on the City website, Spectrum Cable TV Channel 3, or Frontier Cable TV Channel 26.

City of Upland Mission Statement
The City of Upland is committed to delivering superior services that meet community needs with transparency and integrity.

City of Upland Vision Statement
Upland is a safe community with historic character where residents enjoy a high quality of life.

Pages

1. CALL TO ORDER AND ROLL CALL

2. ADDITIONS-DELETIONS TO AGENDA

3. ORAL COMMUNICATIONS
This is a time for any citizen to comment on item listed on the closed session agenda only. Anyone wishing to address the legislative body is requested to submit a speaker card to the City Clerk at or prior to speaking. The speakers are requested to keep their comments to no more than three (3) minutes. The use of visual aids will be included in the time limit.

CLOSED SESSION BEGINS AT 5:00 P.M.

4. CLOSED SESSION
a. CLOSED SESSION CONFERENCE WITH LEGAL COUNSEL - EXISTING

LITIGATION
(Paragraph (1) of subdivision (d) of California Government Code Section 54956.9)
Case Name: Jessica Schultz V. City of Upland
San Bernardino County Superior Court of California Case No. CIV SB 2213164 b. CLOSED SESSION CONFERENCE WITH LEGAL COUNSEL - EXISTING

LITIGATION
(Paragraph (1) of subdivision (d) of California Government Code Section 54956.9)
Case Name: Edward Ventura V. City of Upland
San Bernardino County Superior Court of California Case No. CIV SB 2400261

5. INVOCATION
Pastor Jesus, One & All Church

6. PLEDGE OF ALLEGIANCE

7. PRESENTATIONS

8. CITY ATTORNEY

9. ORAL COMMUNICATIONS
This is a time for any citizen to comment on any item listed or not listed on the agenda.

Anyone wishing to address the legislative body is requested to submit a speaker card to the City Clerk at or prior to speaking. The speakers are requested to keep their comments to no more than three (3) minutes. Speakers will be given five (5) minutes during public hearings. The use of visual aids will be included in the time limit. Public comments and questions for the purpose of hearing current matters of concern in our community and to provide citizens a method for the public to hear those concerns in an open venue is encouraged. However, under the provisions of the Brown Act, the City Council is prohibited from discussion of items not listed on the agenda, and therefore, the City Council, City Manager, or City Attorney will take communications under advisement for consideration and appropriate response or discussion at a later time.

Individuals who demonstrate disruptive conduct during City Council meetings that prevent the City Council from conducting its meeting in an orderly manner are guilty of a misdemeanor as stated in PC403, disrupting a public meeting, and are subject to removal from the chamber or arrest.

CAMPAIGN CONTRIBUTION DISCLOSURE: Pursuant Gov. Code § 84308, any party to a permit, license, contract, or other entitlement before the Council is required to disclose on the record any contribution, including aggregated contributions, of more than $500 made by the party or the party's agents within the preceding 12 months to any City official. Participants and agents are requested to make this disclosure as well. The disclosure must include the name of the party, participant, or agent, and any other person making the contribution; the name of the recipient, the amount of the contribution, and the date the contribution was made.

10. CONSENT CALENDAR
All matters listed under the Consent Calendar are considered to be routine and will be enacted by one vote. There will be no separate discussion of these items unless members of the legislative body request specific items be removed from the Consent Calendar for separate action.

Recommended Action:

Approve the Consent Calendar
a. APPROVAL OF MINUTES 6

Recommended Action:

Approve the Regular Meeting Minutes of February 24, 2025. (Staff Person: Keri Johnson)
b. DESIGNATION OF PROXIES AND PROPOSED SLATE OF DIRECTORS FOR 11

SAN ANTONIO WATER COMPANY BOARD AND WEST END CONSOLIDATED

WATER COMPANY BOARD
CEQA: Not a Project.

Recommended Action:

Appoint Mayor Pro Tern Rudy Zuniga as proxy to vote all shares at the annual stockholder's meeting of the San Antonio Water Company for the slate of directors; and to include the reappointment of Bob Bowcock, Bob Cable, Kati Parker, and Bill Velto to the proposed Board slate. It is further recommend that the City Council appoint Councilmember Shannan Maust as proxy to vote all shares at the annual stockholder's meeting for the West End Consolidated Water Company Board of Directors and to include the appointment of James Breitling and the reappointment of Carlos Garcia and Shannan Maust to the proposed Board slate. (Staff Person: Keri Johnson)
c. SINGLE AUDIT REPORT FOR THE FISCAL YEAR ENDED JUNE 30, 2024 12 CEQA: Not a Project.

Recommended Action:

Receive and file the Single Audit Report on Federal Award Programs for the Fiscal Year ended June 30, 2024. (Staff Person: Stephen Parker) d. CONSIDER ADOPTION OF A RESOLUTION APPROVING THE TRANSFER OF 26 FUND BALANCE TO SECTION 115 TRUSTS AND OTHER CITY COUNCIL

DESIGNATED ACCOUNTS
CEQA: Not a Project.

Recommended Action:

Adopt a Resolution approving a transfer of fund balance to Section 115 Trusts and other City Council designated accounts in conjunction with the General Fund Reserve Policy for the Fiscal Year ended June 30, 2024. (Staff Person: Stephen Parker)
e. CONSIDER ACCEPTING COMMUNITY PROJECT FUNDING GRANT AWARD 36 FOR FISCAL YEAR 2024 FROM CONGRESSMEMBER NORMA TORRES.

CEQA: Not a Project.

Recommended Action:

Accept the Fiscal Year 2024 Community Project Funding Grant award from Congressmember Norma Torres in the amount of $850,000 for rehabilitation of the Historic Downtown Sante Fe Depot Station and appropriate the funds. (Staff Person: Robert Dalquest)
f. CONSIDER APPROVAL OF A LEASE AGREEMENT WITH 42ND STREET 42 BAGEL FOR 220 E. A STREET; AND DETERMINE THE LEASE AGREEMENT

IS CATEGORICALLY EXEMPT FROM CEQA

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

Recommended Action:

Find that the Lease Agreement with 42°d Street Bagel Upland, Inc. is Categorically Exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15301 (Existing Facilities) of the CEQA Guidelines, and direct staff to file a Notice of Exemption with the San Bernardino County Clerk of the Board; and Approve the Lease Agreement with 42"d Street Bagel Upland, Inc and authorize the City Manager to execute the Lease Agreement for a restaurant to operate at 220 E. A Street within the Santa Fe Depot. (Staff Person: Robert Dalquest) g. CONSIDER PROPERTY MANAGEMENT SERVICES AGREEMENT WITH RPM 70

COMPANY FOR MANAGEMENT OF CITY-OWNED RESIDENTIAL RENTAL

PROPERTIES
CEQA: Not a Project.

Recommended Action:

Approve the Property Management Services Agreement with RPM Company and authorize the City Manager to execute the Agreement and any future amendments for management of the City-owned residential rental properties; and find the Agreement is not a project under the California Environmental Quality Act (CEQA) pursuant to Section 15378 of the CEQA Guidelines. (Staff Person:

Robert Dalquest)
h. CONSIDER APPROVING THE NOTICE OF COMPLETION FOR CITYWIDE 100

SLURRY SEALS
CEQA: Categorically exempt from further environmental review pursuant to Section 15301(c) (Existing Facilities), of the CEQA guidelines.

Recommended Action:

Approve the work; authorize the City Manager or designee to record the Notice of Completion; reduce the Faithful Performance Bond to 10% for the Citywide Slurry Seals Project; and authorize a change order increase of$19,522.86 to cover the final construction cost. (Staff Person: Chris Alanis)
i. CONSIDER THE APPROVAL OF THE PURCHASE OF NEW CITY VEHICLES 102 CEQA: Not a Project.

Recommended Action:

Approve the purchase of five (5) 2025 model year Dodge Durango Police Patrol vehicles, one (1) 2025 model year Ford F-150 Police Responder, and one (1) 2025 model year Ford F-550 Super Duty Truck with National Auto Fleet Group of Watsonville, California, for a total amount of $405,492.44; and authorize the City Manager execute all necessary documents related to the vehicle purchases. (Staff Person: Chris Alanis)

11. PUBLIC HEARINGS

12. COUNCIL COMMITTEE REPORTS
a. COUNCIL REPORTS ON REGIONAL COMMITTEE MEETING, TRAINING, OR

CONFERENCE ATTENDANCE

Councilmembers will provide oral reports on any meetings, trainings, or conferences they attended on behalf of the City. This item is for information only.

13. BUSINESS ITEMS
a. FISCAL YEAR 2024-25 MID-YEAR BUDGET REVIEW AND PROPOSED 123

BUDGET ADJUSTMENTS
CEQA: Not a Project.

Recommended Action:

Receive and file the Fiscal Year 2024-25 Mid-Year Budget Review; approve the Mid-Year Budget Review's Proposed Budget Adjustments; approve the updated Schedule of Positions; approve an increase to the capital assets depreciation threshold from $5,000 to $10,000; and approve the recommended Mid-Year Fund Balance Designations. (Staff Person: Stephen Parker)
b. RESPONSE TO GRAND JURY FINDINGS AND RECOMMENDATIONS IN 141 REPORT TITLED "WHEN IS A POTHOLE A POTHOLE? LOOKING AT POTHOLES IN THE CITY OF UPLAND"
CEQA: Not a Project.

Recommended Action:

Approve the response letter to the San Bernardino County Grand Jury and authorize the City Manager to sign the response letter. (Staff Person: Thomas Rice)

14. COUNCIL COMMUNICATIONS

15. CITY MANAGER

16. ADJOURNMENT
The next regularly scheduled City Council meeting is Monday, March 24, 2025.

NOTE: If you challenge the public hearing(s) or the related environmental determinations in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice, or in written correspondence delivered to the City of Upland, at, or prior to, the public hearing.

All Agenda items and back-up materials are available for public review at the Upland Public Library, at 450 North Euclid Avenue, the City Clerk's Office at 460 North Euclid Avenue and the City website at www.uplandca.gov .

In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the City Clerk's Office, 909-931-4120.

Notification 48 hours prior to the meeting will enable the City to make reasonable arrangements to ensure accessibility to this meeting. [28 CFR 35.102-35.104 ADA Title II].

To access written transcription during the meeting, please click this link:
https://attend.wordly.ai/join/LVGO-0906 . Then choose language and click attend to read the transcript on your device.

On March 5, 2025 a true and correct copy of this agenda was posted on the bulletin boards at 450 N. Euclid Avenue (Upland Public Library) and 460 N. Euclid Avenue (Upland City Hall), and the City website at www.uplandca.gov

MINUTES OF THE REGULAR MEETING OF THE UPLAND CITY COUNCIL February 24, 2025
6:00 p.m.

City Council Chamber
City Hall, 460 N. Euclid Avenue
Members Present: Mayor Bill Velto, Councilmember James Breitling, Councilmember Carlos A. Garcia, Councilmember Shannan Maust, Councilmember Rudy Zuniga
Staff Present: City Manager Michael Blay, City Attorney Stephen P. Deitsch, Deputy City Clerk Jennifer Rodriguez

1. CALL TO ORDER AND ROLL CALL
The regular meeting of the Upland City Council was called to order by Mayor Bill Velto at 4:30 p.m. in the Council Chamber of the Upland City Hall.

2. ADDITIONS-DELETIONS TO AGENDA
None.

3. ORAL COMMUNICATIONS
None.

CLOSED SESSION - 4:30 p.m.

4. CLOSED SESSION
At 4:30 p.m. Mayor Velto announced that the City Council would recess to Closed Session pursuant to Government Code
a. CLOSED SESSION CONFERENCE WITH LEGAL COUNSEL- EXISTING

LITIGATION
(Paragraph (1) of subdivision (d) of California Government Code Section 54956.9)
Case Name: Timothy Bailer v. City of Upland, et al
Case Number: 5:24-CV-01805-KK (Federal court)
b. CLOSED SESSION CONFERENCE WITH REAL PROPERTY NEGOTIATORS California Government Code Section 54956.8
Property: Upgrade the existing Verizon Wireless Flag Pole to a new Mono- Eucalyptus in an approximately 380 square foot area located at Magnolia Park in the City of Upland (APN: 1045-031-03)
1

Page 6 of 168 ends

City Negotiators: City Manager Michael Blay, Development Services Director Robert Dalquest, and Economic Development Coordinator Melecio Picazo Negotiating Party: Verizon
Under Negotiation: Price and Terms
c. CLOSED SESSION CONFERENCE WITH REAL PROPERTY NEGOTIATORS California Government Code Section 54956.8
Property: 1.03-acre parcel located on Third Avenue, approximately 75 feet south of the Pacific Electric Trail and adjacent along the north side of the Coy D. Estes Senior Apartments, in the City of Upland (Assessor Parcel Number: 1046-411-54) City Negotiators: City Manager Michael Blay, Development Services Director Robert Dalquest, Housing Manager Diane Cotto and KMA Consultant Julie Romey
Negotiating Party: Steven Dukett, Upland Community Housing, Inc.

Under Negotiation: Price and Terms of payment
The City Council reconvened in open session at 6:04 p.m.

5. INVOCATION
Jim Thomas, Church of Jesus Christ of Latter Day Saints

6. PLEDGE OF ALLEGIANCE
Led by Chief Marcelo Blanco

7. PRESENTATIONS
Recognition of Upland Police Department Promotions

8. CITY ATTORNEY
City Attorney Deitsch announced the City Council received reports on Closed Session Items 4a, 4b, and 4c, and there was no reportable action during Closed Session.

9. ORAL COMMUNICATIONS
A number of individuals spoke in support of retaining recreation programs and library programs. Citing the importance of providing programs for children and families; including the Fourth of July event and library programs. The speakers stated they provide safe outlets and resources for youth, opportunities for families, adults, and seniors to engage in activities, provide cultural opportunities, and have a positive impact on the community. The following spoke:

Jennifer Weisman, Upland Ralph Cavallo, Upland
Paisley Moore-Felt, Upland Frances Hall, Upland
Amelia Weisman, Upland Troy McSwain, Upland
Seven, Upland Sheba Johnson, Upland
Terri Galdo, Upland Chamber of Commerce, announced the Chamber's upcoming State of the City event.
2

Page 7 of 168 ends

Mark Davison, Upland, stated that he owns a business in downtown Upland and thanked the Council for improvements to the downtown and activities that provide economic growth for the area and challenged them to be the City of opportunity.

Mohamad Almouazzen, Field Representative for the Office of Senator Adam B. Schiff, introduced himself to the City Council and affirmed the Senator's dedication to local government efforts.

Joel, Upland, stated there is a need for an ordinance allowing handicap parking near residential properties.

10. CONSENT CALENDAR
Moved by: Councilmember Zuniga
Seconded by: Councilmember Garcia
Approve the Consent Calendar
Motion: Carried Unanimously
a. APPROVAL OF MINUTES
Approve the Regular Meeting Minutes of February 10, 2025. b. CONSIDER APPROVAL OF JANUARY WARRANT AND PAYROLL REGISTERS Approve the January warrant registers totaling $22,895,132.19 (check numbers 51281 — 51675 and direct disbursements) and payroll registers totaling $1,989,694.00 (check numbers 164063 - 164155 and electronic fund transfers 52548 — 53106).
c. TREASURER'S REPORT JANUARY 2025
Receive and file the January 2025 Treasurer's Report.
d. CONSIDER APPROVAL OF A 3RD AMENDMENT TO THE AGREEMENT WITH

JL GROUP, LLC WORKPLACE SOLUTION AND A BUDGET ADJUSTMENT OF $30,000 TO COVER THE INCREASED COST
Approve the third amendment to the original agreement with JL Group, LLC Workplace Solutions for workplace investigation services in the total agreement amount of$130,000, authorize the City Manager to execute the amendment, and approve a budget adjustment in the amount of $30,000 from the General Fund Reserve.
e. CONSIDER APPROVAL OF A BUDGET ADJUSTMENT FOR VEHICLE PARTS

AND REPAIRS
Approve a net zero budget adjustment in the amount of $120,000 to allow for the purchase of vehicle parts and repairs.

11. PUBLIC HEARINGS

12. COUNCIL COMMITTEE REPORTS
a. COUNCIL REPORTS ON REGIONAL COMMITTEE MEETING, TRAINING, OR

CONFERENCE ATTENDANCE
3

Page 8 of 168 ends

No reports.

13. BUSINESS ITEMS
a. REVIEW OF CITYWIDE PROGRAM COSTS
Assistant City Manager Stephen Parker presented the staff report along with a PowerPoint Presentation.

There was discussion regarding the importance of a comprehensive view of the full budget and actively engaging the community before making decisions on potential budget cuts. City Council emphasized the need to fully understand the potential impacts of these cuts and directed staff to develop a comprehensive plan to address budgetary concerns while analyzing the effects to the community, businesses, and the city.

City Manager Michael Blay commented that developing a more comprehensive and detailed list will be labor-intensive but foresees bringing back a detailed list in May as part of the budget process.

Additionally, there was a discussion on exploring further opportunities to engage local businesses and pursue additional sponsorships for city events.

Council directed staff to prepare a staff report to consider future City event spending and the possibility of reducing Library hours. The Council further directed staff to prepare a staff report to discuss volunteer appreciation and the costs associated with it.

There was discussion regarding the cost to provide City sponsored events and the potential impact to residents if events were cancelled.

Councilmember Breitling requested that staff prepare a staff report for consideration to pass banking fees to residents, seconded by Councilmember Garcia.

14. COUNCIL COMMUNICATIONS
Councilmembers announced various activities and events throughout the community; and congratulated newly promoted police officers.

Councilmember Garcia requested to bring back discussion of considering resident advisory member to the Finance Committee, the request was seconded by Mayor Pro Tern Zuniga.

15. CITY MANAGER
City Manager Blay announced that the Notable News and top sales tax producers are now available on website.

16. ADJOURNMENT
At 8:23 p.m., Mayor Velto adjourned in memory of Ben Thouvenell. The next regularly scheduled City Council meeting is Monday, March 10, 2025. 4

Page 9 of 168 ends

Keri Johnson, City Clerk
5

Page 10 of 168 ends

��c �pl"� CITY FUPLAND
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1. Staff T.."-q)°lit
DATE: March 10,2025
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:KERI JOHNSON,CITY CLERK
SUBJECT: DESIGNATION OF PROXIES AND PROPOSED SLATE OF DIRECTORS FOR SAN

ANTONIO WATER COMPANY BOARD AND WEST END CONSOLIDATED WATER

COMPANY BOARD
RECOMMENDED ACTION:

It is recommended that the City Council appoint Mayor Pro Tern Rudy Zuniga as proxy to vote all shares at the annual stockholder's meeting of the San Antonio Water Company for the slate of directors;and to include the reappointment of Bob Bowcock,Bob Cable,Kati Parker,and Bill Velto to the proposed Board slate.It is further recommended that the City Council appoint Councilmember Shannan Maust as proxy to vote all shares at the annual stockholder's meeting for the West End Consolidated Water Company Board of Directors and to include the appointment of James Breitling and the reappointment of Carlos Garcia and Shannan Maust to the proposed Board slate.

GOAL STATEMENT
The proposed action supports the City's strategic efforts to maintain reasonable water rates by developing a long-term systematic strategy to develop facilities in need of improvement, and by implementing management and financial controls.

BACKGROUND
The City of Upland owns controlling interests in two private mutual water companies: San Antonio Water Company (SAWCo)and the West End Consolidated Water Company(West End).As a shareholder,the City is entitled to vote in the elections to select the board of directors of these companies,which it does through a proxy appointed by the City Council.Because the City has a controlling interest in these companies,the City Council's direction to its proxy has the practical effect of naming the directors for SAWCo and West End. This control allows the City Council to ensure these companies take the City's interests into consideration in their respective business decisions.

ISSUES AND ANALYSIS
SAWCo will hold its next annual meeting on April 8,2025,at which four board seats will be voted on.Board Members serve four-year terms. The Mayor has designated Mayor Pro Tem Rudy Zuniga as the City proxy.

West End will hold its next annual meeting in April 2025, at which three board seats will be voted on. Similarly to SAWCo,each member serves a four-year term.The Mayor has designated Councilmember Shannan Maust as the City proxy.

ENVIRONMENTAL DETERMINATION
The proposed action is 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.

Page 11 of 168 ends

4,a trpl CITY
UPLAND
„.;
"The City of Gracious Living"
tIFOBS

1. Staff(kr°ill
DATE: March 10,2025
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:STEPHEN PARKER,CPA,ASSISTANT CITY MANAGER

STACI SULLIVAN,FINANCE MANAGER
SUBJECT: SINGLE AUDIT REPORT FOR THE FISCAL YEAR ENDED JUNE 30,2024 RECOMMENDED ACTION:

It is recommended that the City Council receive and file the Single Audit Report on Federal Award Programs for the Fiscal Year ended June 30,2024.

GOAL STATEMENT
The proposed action supports the City's goal of managing the City's resources in a fiscally responsible manner.

BACKGROUND
Each year, the Finance Division is responsible for the preparation of the Annual Comprehensive Financial Report ("ACFR") following an independent audit. The ACFR presents a summary of financial position and financial transactions for Fiscal Year 2023-24.

A municipality is also subject to a Single Audit if they receive federal recipient award funding that has expended $750,000 or greater in a fiscal year.The City of Upland expended over$750,000 during Fiscal Year 2023-24 and was subject to the Single Audit requirement.

On February 12,2025,the City Council received and filed the ACFR and related reports for the fiscal year ended June 30,2024.

ISSUES AND ANALYSIS
The firm of Van Lant & Fankhanel, LLP, Certified Public Accountants, has conducted an independent audit of all federal expenditures the City or its subrecipients spent during Fiscal Year 2023-24.The opinion by the auditors is that the Schedule of Expenditures of Federal Awards is fairly stated and that in their review of each federal program,they found no material noncompliance and no deficiencies in internal control over compliance that they consider to be material weaknesses or significant deficiencies.

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

ALTERNATIVES
Provide alternative direction to staff.

CEQA:Not a Project.

Page 12 of 168 ends

CITY OF UPLAND
Single Audit Report on
Federal Award Programs
June 30, 2024

Page 13 of 168 ends

CITY OF UPLAND

SINGLE AUDIT REPORT ON FEDERAL AWARD PROGRAMS
Year Ended June 30, 2024

TABLE OF CONTENTS
Page
Independent Auditor's Report on Internal Control Over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards 1 Independent Auditor's Report on Compliance for Each Major Program; Report on Internal Control Over Compliance; and Report on the Schedule of Expenditures of Federal Awards Required by Uniform Guidance 3 Schedule of Expenditures of Federal Awards 6
Notes to the Schedule of Expenditures of Federal Awards 7 Schedule of Findings and Questioned Costs 8
Summary Schedule of Prior Audit Findings 11

Page 14 of 168 ends

Van Lant &
Fankhanel LLP
Certified Public Accountants E-
Independent Auditor's Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards City Council
City of Upland
Upland, California
We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of the governmental activities, business-type activities, each major fund and the aggregate remaining fund information of the City of Upland (City), as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the City's basic financial statements, and have issued our report thereon dated January 30, 2025.

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

A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance.

Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or, significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that were not identified.

Van Lant&Fankhanel,LLP
29970 Technology Drive. Suite 105 A
hv1urrieta. CA 92563
909.856.6879 1 Page 15 of 168

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

Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the City's internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the City's internal control and compliance. Accordingly, this communication is not suitable for any other purpose. 1C1- 4,t YelMA4071-11 lif
January 30, 2025
2 Page 16 of 168

Van Lant &
Fankhanel LLP
Certified Public Accountants E-
Independent Auditor's Report on Compliance for Each Major Federal Program; Report on Internal Control Over Compliance; and Report on the Schedule of Expenditures of Federal Awards Required by Uniform Guidance City Council
City of Upland
Upland, California
Report on Compliance for Each Major Federal Program
Opinion on Each Major Federal Program
We have audited the City of Upland's compliance with the types of compliance requirements described in the OMB Compliance Supplement that could have a direct and material effect on each of the City's major federal programs for the year ended June 30, 2024. The City's major federal programs are identified in the summary of auditor's results section of the accompanying schedule of findings and questioned costs.

In our opinion, the City of Upland, complied, in all material respects, with the types of compliance requirements referred to above that could have a direct and material effect on each of its major federal programs for the year ended June 30, 2024.

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

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

Van Lant&Fankhanel,LLP
29970 Technology Drive. Suite 105 A
hv1urrieta. CA 92563
909.856.6879 3 Page 17 of 168

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

Auditor's Responsibilities for the Audit of Compliance
Our objectives are to obtain reasonable assurance about whether material noncompliance with the compliance requirements referred to above occurred, whether due to fraud or error, and express an opinion on City's compliance based on our audit. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and the Uniform Guidance will always detect material noncompliance when it exists. The risk of not detecting material noncompliance resulting from fraud is higher than for that resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Noncompliance with the compliance requirements referred to above is considered material if there is a substantial likelihood that, individually or in the aggregate, it would influence the judgment made by a reasonable user of the report on compliance about City's compliance with the requirements of each major federal program as a whole.

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

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

Report on Internal Control Over Compliance
A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance with a type of compliance requirement of a federal program on a timely basis. A material weakness in internal control over compliance is a deficiency, or combination of deficiencies, in internal control over compliance, such that there is a reasonable possibility that material noncompliance with a type of compliance requirement of a federal 4 Page 18 of 168

program will not be prevented, or detected and corrected, on a timely basis. A significant deficiency in internal control over compliance is a deficiency, or a combination of deficiencies, in internal control over compliance with a type of compliance requirement of a federal program that is less severe than a material weakness in internal control over compliance, yet important enough to merit attention by those charged with governance.

Our consideration of internal control over compliance was for the limited purpose described in the Auditor's Responsibilities for the Audit of Compliance section and was not designed to identify all deficiencies in internal control over compliance that might be material weaknesses or significant deficiencies in internal control over compliance. Given these limitations, during our audit we did not identify any deficiencies in internal control over compliance that we consider to be material weaknesses, as defined above. However, material weaknesses or significant deficiencies may exist that were not identified.

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

The purpose of this report on internal control over compliance is solely to describe the scope of our testing of internal control over compliance and the results of that testing based on the requirements of the Uniform Guidance. Accordingly, this report is not suitable for any other purpose.

Report on Schedule of Expenditures of Federal Awards Required by the Uniform Guidance We have audited the financial statements of the governmental activities, business-type activities, each major fund, and the aggregate remaining fund information, of the City of Upland, as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the City's basic financial statements. We issued our report thereon dated January 30, 2025, which contained unmodified opinions on those financial statements. Our audit was performed for the purpose of forming opinions on the financial statements that collectively comprise the basic financial statements. The accompanying schedule of expenditures of federal awards is presented for purposes of additional analysis as required by the Uniform Guidance and is not a required part of the basic financial statements.

Such information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the basic financial statements. The information has been subjected to the auditing procedures applied in the audit of the financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the schedule of expenditures of federal awards is fairly stated in all material respects in relation to the basic financial statements as a whole.

February 18, 2025
Murrieta, CA
5 Page 19 of 168

CITY OF UPLAND

SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
Year Ended June 30, 2024
Federal Program Program Provided
Federal Grantor/Pass-Through ALN Identification Expend- to Sub- Grantor/Program or Cluster Title Number Number itures Recipients U.S Department of Housing and Urban Development
Direct Assistance:

CDBG-Entitlement Grants Cluster
Community Development Block Grant 14.218 B-22-MC-06-0569 $ 639,131 $ 119,734 COVID-19-Community Development Block Grant 14.218 B-20-MW-06-0569 56,761 - COVID-19-Community Development Block Grant 14.218 B-20-MW-06-0569 683 - Total CDBG-Entitlement Grants Cluster 696,575 119,734 Community Project Funding Grant 14.251 B-23-CP-CA-0243 284,174 - Total Department of Housing and Urban Development 980,749 119,734 U.S. Department of Justice
Passed through County of San Bernardino Law&Justice Group:

Edward Byrne Memorial Justice Assistance Grant 16.738 2018-DJ-BX 0650 15,270 - Edward Byrne Memorial Justice Assistance Grant 16.738 2019-DJ-BX 0699 15,732 - Edward Byrne Memorial Justice Assistance Grant 16.738 2020-DJ-BX-0476 15,597 - Edward Byrne Memorial Justice Assistance Grant 16.738 21-1026 19,513 - Edward Byrne Memorial Justice Assistance Grant 16.738 22-1128 23,094 - Direct Assistance:

Bulletproof Vest Partnership Program 16.607 31,346 - Total Department of Justice 120,552 -
U.S. Department of Transportation
Passed through the California Department of Transportation Office of Traffic Safety:

Highway Safety Cluster
Selective Traffic Enforcement Program 20.600 PT23189 16,311 - Selective Traffic Enforcement Program 20.600 PT24211 69,698 - Total Selective Traffic Enforcement Program 86,009 - National Priority Safety Programs 20.616 MC23008 3,126 - National Priority Safety Programs 20.616 MC24012 6,045 - National Priority Safety Programs 20.616 TR23021 11,020 - Total National Priority Safety Programs 20,191 - Total Highway Safety Cluster 106,200 -
Passed through the California Department of Transportation Office of Traffic Safety:

Minimum Penalties for Repeat Offenders for Driving While Intoxicated 20.608 PT23189 27,897 - Minimum Penalties for Repeat Offenders for Driving While Intoxicated 20.608 PT22096 39,507 - Total Minimum Penalties for Repeat Offenders for Driving While Intoxicated 67,404 - Total Department of Transportation 173,604 - U.S Department of Treasury
Direct Assistance:

COVID-19 Coronavirus State and Local Fiscal Recovery Funds 21.027 N/A 4,829,904 * - Total Department of Treasury 4,829,904 -
U.S Department of Homeland Security
Direct Assistance:

Targeted Violence and Terrorism Prevention Grant Program 97.132 EMW-2021-GR-00081 31,632 - Passed through the San Bernardino County Fire Protection District Office of Emergency Services:

Homeland Security Grant Program 97.067 N/A 9,442 - Hazard Mitigation Grant Program 97.039 HMGP-OB-02 383 - Total Department of Homeland Security 41,457 - Total Expenditures of Federal Awards $6,146,266 $ 119,734 = Major Program
6 Page 20 of 168

CITY OF UPLAND

NOTES TO THE SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS Year Ended June 30, 2024
1) Basis of Presentation
The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of the City of Upland (the City) under programs of the federal government as well as federal financial assistance passed through other government agencies for the year ended June 30, 2024. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards(Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the City, it is not intended to and does not present the financial statements of the City. The City's reporting entity is defined in Note 1 of the notes to the City's financial statements. 2) Summary of Significant Accounting Policies
Expenditures reported on the Schedule are reported using the modified accrual basis of accounting for those grants that were recorded in governmental funds, and on the accrual basis of accounting for those grants that were recorded in proprietary funds. Such expenditures for part of the year are recognized following the cost principles contained in OMB Circular A-87, Cost Principles for State, Local and Indian Tribal Governments and for part of the year contained in Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards wherein certain types of expenditures are not allowable or are limited as to reimbursement. Pass-through entity identifying numbers are presented where available. The City elected not to use the 10% de minimis cost rate as covered in Section 200.414 Indirect (F&A) costs.
3) Major Programs
The City had one major program for the year ended June 30, 2024, consisting of the Coronavirus State and Local Fiscal Recovery Funds which had total disbursements of$4,829,904. This amount calculates to 78.6% of the total disbursements from federal awards. 4) Subrecipient Expenditures
During the fiscal year ended June 30, 2024, the City made payments to subrecipients which consisted of the following:

Inland Mediation Board - Fair Housing $ 27,600 St. Joseph Church - His Hands Food 18,000
Inland Valley Recovery Service - Distribution of Hygiene 4,000 Inland Mediation Board - Housing Mediation 20,587 Assistance League Foothill Community - Operation School Bell 8,000 Upland Community Resource Center 21,000
Inland Valley Hope Partners 8,000
Pacific Lifeline -Women's Shelter 5,000
Foothill Family Shelter- Stepping Stone 7,547
Total Subrecipients $ 119,734
7 Page 21 of 168

CITY OF UPLAND

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
Year Ended June 30, 2024
SECTION I — SUMMARY OF AUDITOR'S RESULTS
Financial Statements
Type of Auditor's Report Issued: Unmodified Internal Control Over Financial Reporting:

Material Weakness(es) Identified? No
Significant Deficiencies Identified not Considered
to be Material Weaknesses? None reported
Noncompliance Material to Financial Statements Noted? No Federal Awards
Internal Control Over Major Programs:

Material Weakness(es) Identified? No
Significant Deficiencies Identified not Considered
to be Material Weaknesses? None reported
Type of Auditor's Report Issued on Compliance for Major Programs: Unmodified Any Audit Findings Disclosed that are Required to be Reported in Accordance With Uniform Guidance? No
Identification of Major Programs:

ALN Numbers Name of Federal Program or Cluster

21.027 Coronavirus State and Local Fiscal Recovery Funds Dollar Threshold used to Distinguish Between Type A
And Type B Programs: $ 750,000
Auditee Qualified as Low-Risk Auditee? Yes
8 Page 22 of 168

CITY OF UPLAND

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
Year Ended June 30, 2024
SECTION II — FINANCIAL STATEMENT FINDINGS
There were no auditor's findings to be reported in accordance with Government Auditing Standards. 9 Page 23 of 168

CITY OF UPLAND

SCHEDULE OF FINDINGS AND QUESTIONED COSTS
Year Ended June 30, 2024
SECTION III — FEDERAL AWARD FINDINGS AND QUESTIONED COSTS There were no auditor's findings to be reported in accordance with Uniform Guidance. 10 Page 24 of 168

CITY OF UPLAND

SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
Year Ended June 30, 2024
SECTION II — FINANCIAL STATEMENT FINDINGS
There were no auditor's findings reported in accordance with Government Auditing Standards.

SECTION III — FEDERAL AWARD FINDINGS AND QUESTIONED COSTS There were no auditor's findings to be reported in accordance with the Uniform Guidance. 11 Page 25 of 168

�� pl"� CI,UPLAND
"The City of Gracious Living"
tIFOBS

1. Staff(kr°ill
DATE: March 10,2025
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:STEPHEN PARKER,CPA,ASSISTANT CITY MANAGER

STACI SULLIVAN,FINANCE MANAGER
SUBJECT: CONSIDER ADOPTION OF A RESOLUTION APPROVING THE TRANSFER OF FUND BALANCE TO SECTION 115 TRUSTS AND OTHER CITY COUNCIL DESIGNATED

ACCOUNTS
RECOMMENDED ACTION:

It is recommended that the City Council adopt a Resolution approving a transfer of fund balance to Section 115 Trusts and other City Council designated accounts in conjunction with the General Fund Reserve Policy for the Fiscal Year ended June 30,2024.

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

BACKGROUND
On June 10, 2024, the City Council adopted Resolution No. 6781 updating the General Fund Reserve Policy in conjunction with the Fiscal Year 2024-25—2025-26 biennial budget.

On February 10, 2024,the City Council received and filed the Annual Comprehensive Financial Report(ACFR) for the Fiscal Year ended June 30,2024.

ISSUES AND ANALYSIS
The City's General Fund Reserve Policy was originally adopted on June 14, 2021, and has been updated annually thereafter in conjunction with the adoption of the budget. The Reserve Policy lays out a methodology for allocating any year-end operating surplus designated by the City in the event of unforeseen expenditures as well as to establish funding for anticipated future expenditures that require ongoing funding for significant future outlays.

The Fiscal Year 2023/24 ACFR reflects a$6,198,819 year-end operating surplus.The attached Resolution authorizes transfers to take place in conjunction with the Reserve Policy:

Total
Policy FY 2024-25 Target
Reserve Title Reserve
Description Usage Transfer Level
Balance
>5%decrease in
Economic 25%of GF O/M property/sales tax or 25%of GF Uncertainty expenditures State/Federal revenue $1,600,000 $15,400,000 Budget reductions
Emergency Disaster $1 million Emergency event $0 $1,000,000 $1 million maximum
5%of remaining General Plan $2 million
General Plan Update balance expenditures $229,941 $1,030,909 maximum Building 15%of remaining Capital project
Replacement/ $689,823 $3,183,232 N/A
Maintenance balance expenditures
Infrastructure 30%of remaining Capital project Improvement balance expenditures $1,379,646 $3,929,967 N/A

Page 26 of 168 ends

Payment to Trust FY 2023-24
Policy Description Usage
Administrator Transfer
Pension Stabilization Section o Pay down accrued unfunded 115 Trust 40%of remaining balance pension liability $1,839,528 OPEB Section 115 Trust 5%of remaining balance Pay down accrued unfunded $229,941 OPEB liability

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

ALTERNATIVES
Provide alternative direction to staff.

CEQA:Not a Project.

Page 27 of 168 ends

RESOLUTION NO.

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

UPLAND APPROVING THE TRANSFER OF FUND BALANCE TO
SECTION 115 TRUSTS AND OTHER CITY COUNCIL

DESIGNATED ACCOUNTS IN CONJUNCTION WITH THE

GENERAL FUND RESERVE POLICY FOR THE FISCAL YEAR
ENDED JUNE 30, 2024
WHEREAS, on June 14, 2021, the City Council adopted Resolution No. 6595 establishing a General Fund Reserve Policy ("Policy") in conjunction with the budget adoption for Fiscal Year 2021-22; and
WHEREAS, the City Council adopted Resolution No. 6781 updating the Policy in conjunction with the Fiscal Year 2024-25 - 2025-26 biennial budget; and WHEREAS, the Policy lays out a methodology for allocating any year-end operating surplus to six established reserves; and
WHEREAS, the Fiscal Year 2021-22 Annual Comprehensive Financial Report reflected a $30,500,000 payment towards the City's unfunded pension liability, which stemmed from a $20,750,000 investment by the Water and Sewer Funds in a lease agreement of the General Fund and a $10,000,000 draw-down from the City's Section 115 Pension Trust; and
WHEREAS, the recording of the $30,500,000 payment towards the unfunded pension liability as an expense in the General Fund is required according to Governmental Accounting Standards Board Statement No. 5; and WHEREAS, the $10,000,000 payment towards the unfunded pension liability from the City's Section 115 Pension Trust did not adversely affect the General Fund's cash as it came from a separate fund and was recorded in restricted cash; and WHEREAS, the recording of the $20,500,000 payment towards the unfunded pension liability would not have been recorded as an expense in the City's General Fund had the financing of the funds been from an external source instead of a $20,750,000 investment by the Water and Sewer Fund; and WHEREAS, the $20,750,000 the City's General Fund owes the Water and Sewer Funds is not due currently, but will be made in installment payments over 15 years in conjunction with the promissory notes signed by the City of Upland Financing Authority with each fund; and
WHEREAS, despite recording the $30,500,000 payment towards the unfunded pension liability as an expense, resulting in a negative unassigned fund balance in the General Fund, the General Fund's cash has not been adversely affected by the payment; and
WHEREAS, the FY 2023-24 Annual Comprehensive Financial Report reflects a $6,198,819 year-end operating surplus for the City's General Fund; and

Page 28 of 168 ends

Resolution No.

Page 2 ends

WHEREAS, for the reasons detailed above, despite the Unassigned Fund Balance in the General Fund having a deficit balance, the City Council desires to allocate funds relating to Fiscal Year 2023-24 based on the $6,198,819 year-end operating surplus; and
WHEREAS, the City Council desires to reallocate the General Fund Fund Balance and transfer funds to the City's third-party Section 115 Trust administrator in conjunction with the General Fund Reserve Policy.

NOW, THEREFORE, the Upland City Council hereby finds, determines and resolves, as follows:

Section 1. All the above recitals are true and correct and are incorporated herein by this reference.

Section 2. The City Council does hereby approve and direct the following:

1. A funding of the following reserves as follows:

Economic Uncertainty Reserve $ 1,600,000
General Plan Update Reserve $ 229,941
Building Replacement and Maintenance Reserve $ 689,823 Infrastructure Improvement Reserve $ 1,379,646

2. Payments to the City's Section 115 Trust administrator as follows:

Pension Stabilization Section 115 Trust $ 1,829,528 OPEB Section 115 Trust $ 229,941

3. Any necessary adjustments to the budget to reflect the one-time transfers directed herein.

Section 3. This resolution shall prevail over any existing resolution in the event of a conflict.

Section 4. Compliance with California Environmental Quality Act. The City Council finds that this Resolution is not subject to the California Environmental Quality Act ("CEQA") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project t as defined in Section 15378) of the State CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly. Further, if the activity is deemed a project this City Council finds that this Resolution is exempt pursuant to Section 15061(b)(3) of the State CEQA Guidelines.

Page 29 of 168 ends

Resolution No.

Page 3 ends

Section 5. Certification. The City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original resolutions.

Section 6. Severability. If any section, subsection, subdivision, sentence, or clause or phrase in this Resolution or any part thereof is for any reason held to be unconstitutional, invalid or ineffective by any court of competent jurisdiction, such decision shall not affect the validity or effectiveness of the remaining portions of this Resolution or any part thereof. The City Council hereby declares that it would have adopted each section irrespective of the fact that any one or more subsections, subdivisions, sentences, clauses, or phrases are declared unconstitutional, invalid, or ineffective.

Section 7. Effective Date. This Resolution shall become effective immediately.

PASSED, APPROVED AND ADOPTED this 10th day of March, 2025.

Bill Velto, Mayor
I, Keri Johnson, City Clerk of the City of Upland, do hereby certify that the foregoing Resolution was adopted at a regular meeting of the City Council held on the 10th day of March, 2025, by the following vote:

AYES:

NOES:

ABSENT:

ABSTAINED:

ATTEST:

Keri Johnson, City Clerk

Page 30 of 168 ends

RESOLUTION NO. 6781

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF

UPLAND, CALIFORNIA APPROVING THE GENERAL FUND
RESERVE POLICY FOR THE 2024-2025 AND 2025-2026

FISCAL YEARS
WHEREAS, the City Manager has caused a budget document to be prepared covering the Fiscal Year (FY) July 1, 2024 through June 30, 2025 and July 1, 2025 through June 30, 2026; and
WHEREAS, the City Council held a public budget workshop on the proposed FY 2024-2025 and FY 2025-2026 budget on May 20, 2024 and approved and adopted the FY 2023-2024 and FY 2024-2025 budget on June 10, 2024; and WHEREAS, it is essential that governments maintain adequate levels of General Fund Balance to mitigate current and future risk, to ensure stability, and in support of long-term financial planning; and
WHEREAS, the Government Finance Officers Association ("GFOA") recommends at a minimum, that general-purpose governments, regardless of size, maintain unrestricted budgetary fund balance in their general fund of no less than

16.67% (two months) of regular general fund operating revenues or regular general fund operating expenditures; and
WHEREAS, the GFOA further recommends that governments establish a formal policy on the level of Committed Fund Balance which should be maintained in the General Fund; and
WHEREAS, pursuant to Governmental Accounting Standards Board Statement No. 54, an action of the City Council is necessary to commit budget amounts in various funds for the specific purposes they intended; and WHEREAS, the City Council established a General Fund Reserve Policy ("Reserve Policy") on June 14, 2021; and
WHEREAS, the Reserve Policy has subsequently been approved annually in conjunction with the budget adoption; and
WHEREAS, the Reserve Policy calls for the appropriate level of reserves to be reviewed and approved by City Council at least every other year during the biannual budget process; and
WHEREAS, City Staff and City Council have reviewed the Reserve Policy and desire to affirm the policy at this time.

NOW, THEREFORE, the City Council of the City of Upland hereby finds, determines and resolves as follows:

Page 31 of 168 ends

Resolution No. 6781

Page 2 ends

Section 1. The above recitals are true and correct and are incorporated herein by this reference.

Section 2. The City Council does hereby approve and adopt the General Fund Reserve Policy attached hereto as Exhibit "A".

Section 3. Compliance with California Environmental Quality Act. The City Council finds that this Resolution is not subject to the California Environmental Quality Act ("CEQA") pursuant to Sections 15060(c)(2) (the activity will not result in a direct or reasonably foreseeable indirect physical change in the environment) and 15060(c)(3) (the activity is not a project as defined in Section 15378) of the State CEQA Guidelines, California Code of Regulations, Title 14, Chapter 3, because it has no potential for resulting in physical change to the environment, directly or indirectly.

Further, if the activity is deemed a project this City Council finds that this Resolution is exempt pursuant to Section 15061(b)(3) of the State CEQA Guidelines.

Section 4. Certification. The City Clerk shall certify to the passage and adoption of this Resolution and enter it into the book of original resolutions.

Section 5. Severability. If any section, subsection, subdivision, sentence, or clause or phrase in this Resolution or any part thereof is for any reason held to be unconstitutional, invalid or ineffective by any court of competent jurisdiction, such decision shall not affect the validity or effectiveness of the remaining portions of this Resolution or any part thereof. The City Council hereby declares that it would have adopted each section irrespective of the fact that any one or more subsections, subdivisions, sentences, clauses, or phrases are declared unconstitutional, invalid, or ineffective.

Section 6. Effective Date. This Resolution shall become effective immediately.

PASSED, APPROVED and ADOPTED this 10th day of June, 2024.

AYES: Mayor Velto, Councilmembers Breitling, Garcia, Maust, Zuniga NOES: None
ABSENT: None
ABSTAINED: None
ATTEST:

Keri Johnson, I y CI rk

Page 32 of 168 ends

EXHIBIT A

CITY OF UPLAND

GENERAL FUND RESERVE POLICY
I. GENERAL POLICY/PURPOSE
The City of Upland provides a wide range of services that impact the public safety and the quality of life of its residents and community members every day. Maintaining adequate reserves is an essential part of sound financial management. The purpose of this policy is to secure the City's financial stability during a changing environment and establish a procedure for the allocation of unrestricted fund balance in the General Fund into adequate committed reserves.

II. PERIODIC REVIEW AND REPORTING
This General Fund Reserve Policy and the appropriate level of reserves are to be reviewed and approved by City Council at least every other year during the biannual budget process. The Administrative Services Department will continue to monitor reserve and investment balances year-round to maintain healthy reserve levels.

The status of the General Fund Reserve shall be analyzed and estimated by the Administrative Services Department using departmental year-end estimates and reported with the adoption of each year's budget. The actual General Fund Reserve balances shall be reported to the City Council as adjustments to the balances occur, but not less than annually in the agenda report accepting the Annual Comprehensive Financial Report(ACFR).

III. USE OF RESERVE FUNDS
The following committed reserves are designated by the City in the event of unforeseen expenditures as well as to establish funding for anticipated future expenditures that require ongoing funding for significant future outlays. These committed balances are established by a resolution of the City Council and cannot be changed except by a similar subsequent City Council action. The committed reserves are presented as follows:

A. Economic Uncertainty Reserve
• Purpose: These funds are committed to mitigate annual budget revenue shortfalls as a protection from a fluctuating economy, including financial hardship or downturns in the economy and/or Council-approved expenditures in excess of revenues. • Target Level: The City's target will be 25.0% (rounded to the next $100,000) of the General Fund operating expenditures, exceeding the recommendation of the Government Finance Officers Association (GFOA).
• Events or Conditions Prompting Its Use: This reserve may be utilized as needed to pay outstanding operating expenditures due to budgeted revenue shortfalls. Use shall be prompted by:
o A 5%or greater decrease in property or sales taxes
o Reductions in revenue due to actions by the state/federal government B. Emergency Disaster Contingency Reserve
• Purpose: These funds are committed to mitigate costs of unforeseeable emergencies, such as natural disasters, catastrophic events, or any situation requiring the declaration of an emergency as defined by Upland Municipal Code Section 2.20. • Target Level: $1,000,000.

Page 33 of 168 ends

EXHIBIT A

CITY OF UPLAND

GENERAL FUND RESERVE POLICY
• Events or Conditions Prompting Its Use: This reserve may be utilized to cover unexpected losses experienced by the City as a result of an unplanned, emergency event as described above.

C. General Plan Update Reserve
• Purpose: These funds are committed for the General Plan update, which is required by State law to be updated periodically.
• Target Level: $2,000,000. The budgeted contribution shall be derived from development services related fees. In addition, 5%of any operating year-end surplus(after Reserves A and B are fully funded)will be deposited in this reserve until the target level is reached. • Events or Conditions Prompting Its Use: This reserve may be utilized for General Plan expenditures approved by City Council.

D. Building Replacement and Maintenance Reserve
• Purpose: These funds are committed for non-routine maintenance, remodeling, or replacement of key City-owned buildings and are established to provide capital repair and replacement funding as the City's infrastructure deteriorates over its expected useful life. • Target Level: The budgeted contribution shall be at a minimum level of 0.25%of operating expenditures. In addition, 15%of any operating year-end surplus(after Reserves A and B are fully funded) will be deposited in this reserve.
• Events or Conditions Prompting Its Use: This reserve may be utilized for capital projects approved by City Council.

E. Pension Stabilization Reserve
• Purpose: These funds are committed to mitigate volatile annual increases in CaIPERS contribution rates. Funds deposited in this reserve will be remitted to the City's PARS Pension Stabilization Fund Trust and the Other Post-Employment Benefits Trust until City Council determines funds are needed to help offset annual CaIPERS' contributions. • Target Level:
o Pension Stabilization Fund Trust: 40% (45% once Reserve C is fully funded) of any year- end operating surplus (after Reserves A and B are fully funded) will be deposited in this reserve.
o OPEB Trust: 5% of any year-end operating surplus (after Reserves A and B are fully funded) will be deposited in this reserve.
• Events or Conditions Prompting Its Use: The City Council may decide as part of its annual or mid-year budget process to expend some or all of the accumulated Pension Stabilization Reserve Fund balance to pay down accrued unfunded pension or OPEB liability.

F. Infrastructure Improvement Reserve
• Purpose: These funds are committed for non-routine maintenance, construction, or replacement of key City-owned infrastructure assets (e.g., streets, sidewalks, tree trimming, etc.) and are established to provide capital repair and replacement funding as the City's infrastructure deteriorates over its expected useful life. • Target Level: 30%of any year-end operating surplus(after Reserves A and B are fully funded) will be deposited in this reserve.
• Events or Conditions Prompting Its Use: This reserve may be utilized for capital projects approved by City Council.

Page 34 of 168 ends

EXHIBIT A

CITY OF UPLAND

GENERAL FUND RESERVE POLICY
IV. Replenishment of Unreserved Fund Balance
At the end of the year, the Administrative Services Department reports on the audited year-end fiscal results. Should actual General Fund revenues exceed expenditures,a year-end operating surplus shall be reported. Should the General Fund's Unassigned Fund Balance be in a deficit position due to any long- term internal borrowing, despite being excluded from the ACFR due to compliance with GASB 54, such reserves shall still receive an allocation of year-end operating surplus as elaborated below.

Allocation of any year-end operating surplus will be distributed throughout the six established reserves as follows:
• Reserves A and B have target levels and are prioritized for replenishment in the order they are listed should any reserve be employed or if Reserve A increased as a result of growth in the City's annual operating budget. The City's goal will be to replenish these reserves, if used, within five fiscal years.
• Once reserves A and B attain full funding, the remaining year-end operating surplus shall be distributed to the following reserves:
o 5%to the General Plan Update Reserve, until fully funded (Reserve C) o 15%to the Building Replacement and Maintenance Reserve (Reserve D) o 45%(50%once Reserve C is fully funded)to the Pension Stabilization Reserve (Reserve E) o 30%to the Infrastructure Improvement Reserve (Reserve F)

Page 35 of 168 ends

4��a �p19� CITY UPLAND
�5, _�� "The City of Gracious Living"
C,,tIFOB,S
'• Stafif(krctilt
DATE: March 10,2025
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:ROBERT D.DALQUEST,DEVELOPMENT SERVICES DIRECTOR SUBJECT: CONSIDER ACCEPTING COMMUNITY PROJECT FUNDING GRANT AWARD FOR FISCAL YEAR 2024 FROM CONGRESSMEMBER NORMA TORRES
RECOMMENDED ACTION:

It is recommended that the City Council accept the Fiscal Year 2024 Community Project Funding Grant award from Congressmember Norma Tones in the amount of$850,000 for rehabilitation of the Historic Downtown Sante Fe Depot Station 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 retain the historic character of Downtown, as well as revitalize the Historic Downtown Sante Fe Depot Station and encourage an increase in ridership and create a destination plaza that attracts visitors and residents to patron the businesses within in the Historic Depot and surrounding Downtown area.

BACKGROUND
In 2021, Congress reinstated the process of earmarking funds 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).

The City previously applied for Community Project Funding Grants and was awarded$1 million in Fiscal Year(FY) 2022 with Congressmember Pete Aguilar and $750,000 in FY 2023 with Congressmember Norma Torres for both Phase I and II of the"Downtown Upland Main Street Economic Recovery and Revitalization Project".

In 2023,the City applied to Congressmember Norma Tones for FY 2024 Community Project Funding Grant in the amount of$850,000 to rehabilitate the Historic Downtown Upland Sante Fe Deport Station as part of Phase III of the "Downtown Upland Main Street Economic Recovery and Revitalization Project". In August 2024, the U.S.

Department of Housing and Urban Development(HUD) sent staff the grant award letter and agreement which made it official the grant application was awarded.All documents have been completed and only a detailed budget remains to be submitted to HUD.Attached for,City Council's reference,is the award letter received from HUD.

ISSUES AND ANALYSIS
The grant will be used to fund the design,construction,and ultimate rehabilitation of the Historic Depot Station. The improvements will address the physical and economic blight conditions within the Station Area and enhance the economic climate by expanding business opportunities and transform the Downtown into a pedestrian-friendly business district that encourages commerce through alternative transportation modes such as, commuter rail, pedestrians,and bicycles.

ENVIRONMENTAL DETERMINATION
Acceptance of the FY 2024 Community Project Funding Grant 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 total grant award is $850,000. The revenue and corresponding expenses will be budgeted in Fund 217,Project No.25446,Historic Downtown Santa Fe Depot Station.

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ALTERNATIVES
Provide alternative direction to staff.

CEQA:Not a Project.

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P,yEnr U.S.DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT II d.101
WASHINGTON,D.C.20410-1000
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OFFICE OF COMMUNITY PLANNING AND DEVELOPMENT
Tuesday,August 27,2024
Robert D. Dalquest
City of Upland
460 N. Euclid Avenue
Upland, CA 91786
Email: [email protected]
Dear Community Project Funding Grantee,
In the Consolidated Appropriations Act, 2024 (Public Law 118-42) (the FY2024 Act), and the Further Consolidated Appropriations Act, 2024 (Public Law 118-47) (the Further FY2024 Act) Congress made $3,290,054,336 in funding available for Community Project Funding (CPF). These CPF awards are administered by the Department of Housing and Urban Development(HUD). HUD received the information below about your project from Congress. A Grant Number has been added and will be the unique identifier for your project throughout the grant process.

Grant Number: B-24-CP-CA-0378
Project: Downtown Upland Main Street Economic Recovery and Revitalization Project— Phase 3 Rehabilitation of the Historic Downtown Upland Metrolink Station Grantee/Recipeint: City of Upland
Amount: $850,000
HUD Grant Officer Njeri Santana-Carter/[email protected] HUD System Officer: Quiana.A.Johnson/[email protected] HUD Regional Environmental Officer: Elizabeth McDargh/[email protected] This letter outlines initial grant award requirements and information needed from you to get started. This Grant Award Package also includes: The "FY2024 Community Project Funding Grant Guide" (FY2024 CPF Grant Guide), the template for your FY2024 Community Project Funding Grant Agreement, and the forms required to complete and submit information online to populate before we sign your FY2024 CPF Grant Agreement. A brief overview of these documents is below:
1) FY2024 CPF Grant Guide: The FY2024 CPF Grant Guide provides instructions for completing the requested information and filling out the required administrative forms to initiate your FY2024 CPF Grant Agreement. Please refer to this document as it includes important information and forms for accessing the online system (DRGR), as well as other information concerning reporting requirements.

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2) FY2024 CPF Grant Agreement for this Award: The FY2024 CPF Grant Agreement specifies the applicable statutory provisions, regulations, and administrative requirements for this award. Please make sure all grantee information and award-specific information is entered completely and accurately before signing this Agreement. When you submit your grant materials on our DRGR Grant Processing Module it will create your customized FY2024 CPF Grant Agreement. 3) Standard Forms and Required Materials: The following forms will be needed:
a. Form HUD-1044, Assistance Award/Amendment Form (Attached) b. Standard Form-424 Application for Federal Assistance (in the online system) c. SF-424-B, Assurances for Non construction Programs, and/or SF-424-D,Assurances for Construction Programs (in the online system)
d. SF-LLL Disclosure of Lobbying Activities (as applicable in the online system):
https://www.grants.gov/forms/forms-repository/sf-424-family e. SF-1199A - Direct Deposit Sign-Up Form: https://www.gsa.gov/system/files/SF1199A-

20.pdf The form is to be completed by the grantee and grantee's financial institution.

Grantees will need to submit the completed form and upload to DRGR.

Grant Award Process Overview
Below is a step-by-step walk-through of the process and necessary documents and forms to execute your FY2024 CPF Grant Agreement. This process and the forms are also available in the FY2024 CPF Grant Guide, which can also be found on the program's webpage at:
https://www.hud.gov/program_offices/comm_planning/edi-grants/FY_2024 on HUD.gov and on this webpage https://www.hudexchange.info/programs/cpf/ on the HUD Exchange.

1. Grantees should review the Grant Award Package documents.

2. Grantees should initiate or complete the HUD environmental review.

3. Grantees gather all required information and submit to HUD using the online system DRGR.

4. HUD provides access to DRGR system to access the Grant Processing Module to submit required information, answer questions, and upload documents. Once all required information is submitted online HUD will review the completed grant materials submitted.

5. HUD staff will review the information and documents for completeness. If there are any deficiencies the corrections and/or clarifying questions will be shared with the grantee for correcting or answering the clarifying questions. If not, HUD staff will submit the package internally for a second level review. Then, the Acting Director for the Congressional Grants Division will review the grant package. Finally, your Grant Agreement will be executed.

6. HUD will notify the grantee that their FY2024 Grant Agreement has been fully executed and will share additional materials with the grantee to complete to begin the payment processing activities to receive your funds.

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Training and Tools
FY2024 CPF Onboarding Event: This event will take place in September. We will review this letter and grant award package materials along with sharing next steps and how to sign up for a cohort. The event will be recorded and shared online after the event.

FY2024 CPF Grantee Cohorts: This provides you and your staff the opportunity to register for a four-part training for how to prepare your grant materials and submit them online. Information about the registration will be shared via email and during the FY2024 CPF Onboarding Event.

FY2024 CPF Grantee Webinar Series: This provides you and your staff with information about the regulations, requirements, and processes for your grant. Information about the registration for the webinar series will be shared via email and during the FY2024 CPF Onboarding Event.

FY2024 CPF Grantee Online HUD Exchange Resources: This website page includes general information and your specific Fiscal Year information along with links to past and future technical assistance opportunities. The site is also used for you to register for our listsery and for communicating updates to you and those on the listserv.

Overview of Requirements
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:
1) Administrative Requirements: CPF grants are subject to the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (2 CFR Part 200).
2) HUD Environmental Review Requirements: EDUCPF 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 appropriate federal environmental and historic preservation laws, regulations, and Executive Orders.
• To be eligible, activities and 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.
• If the environmental review is being conducted by a local government responsible entity under Part 58, a Request for Release of Funds and Certification must be approved by HUD, as applicable. If the environmental review is being completed by HUD under Part 50, the environmental review must be approved and certified by HUD.

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• 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. • For FY2024 grants, the date of the Act's enactment (March 9, 2024) is the federal nexus for compliance with all environmental laws. Once a project is federalized, 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 all necessary HUD approvals must be obtained prior to taking any choice limiting actions, such as acquisition, construction, ground disturbance, and entering into contracts. • Further explanation and guidance on choice limiting actions and the environmental review process, including historic preservation review, is included within the CPF Grant Guide and on the program's webpage at: https://www.hudexchange.info/programs/cpf/ . • Some projects may already be underway at the time of federal nexus and while it is still best practice to stop all work after the federal nexus before the environmental review is complete for EDI/CPF projects that are already underway at time of federal nexus, grantees are allowed to perform activities after the federal nexus, but only for activities which are part of a pre-nexus contract that obligates them to do so. However, grantees would be doing so at their own risk, as any activity performed, or proposed to be performed, after the federal nexus must be included in the project scope of a satisfactory environmental review to be reimbursable.
• A satisfactory review must show that the project activities will not result in unmitigable environmental harm and must not preclude consultation with the appropriate environmental authorities such as the State Historic Preservation Office (SHPO). Environmental authorities may refuse to consult if physical impacts are made to a site before consultation. • HUD conducted a nationwide environmental review for FY24 EDI/CPF soft costs to clear activities such as administrative,planning, and operations and maintenance costs (including costs to prepare an environmental review). After execution of the Grant Agreement, eligible soft costs can be incurred after March 9, 2024 (see 2 CFR 200.403). Eligible hard costs can be reimbursed if incurred after a full environmental review is completed(see 2 CFR 200.403).
• HUD Environmental Officers:
https://www.hud.gov/sites/dfiles/CPD/documents/Community-Proj ect-Funding-Portfolio- Assignments.pdf.

If you, or your staff, have any questions regarding how to complete or submit the requires documents,please feel free to contact your Grant Officer or System Officer. Please note while your Grant Officer may change over time, we have a team approach to managing your project. Please include your grant number and project in all email correspondence. We look forward to working with you on this important project! Sincerely,
Nadab Bynum
Acting Deputy Assistant Secretary
for Economic Development

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4��a �p19� CITY UPLAND
�5, _�� "The City of Gracious Living"
CltIFOBS

1. Staff(kr°lit
DATE: March 10,2025
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:ROBERT D.DALQUEST,DEVELOPMENT SERVICES DIRECTOR

MELECIO PICAZO,ECONOMIC DEVELOPMENT COORDINATOR
SUBJECT: CONSIDER APPROVAL OF A LEASE AGREEMENT WITH 42ND STREET BAGEL FOR 220 E.A STREET;AND DETERMINE THE LEASE AGREEMENT IS CATEGORICALLY

EXEMPT FROM CEQA
RECOMMENDED ACTION:

It is recommended that the City Council: 1) Find that the Lease Agreement with 42nd Street Bagel Upland, Inc. is Categorically Exempt from the California Environmental Quality Act(CEQA)pursuant to Section 15301 (Existing Facilities) of the CEQA Guidelines, and direct staff to file a Notice of Exemption with the San Bernardino County Clerk of the Board; and 2)Approve the Lease Agreement with 42nd Street Bagel Upland,Inc and authorize the City Manager to execute the Lease Agreement for a restaurant to operate at 220 E.A Street within the Santa Fe Depot.

GOAL STATEMENT
The proposed action will support the City's goal to protect local government funding and its assets.

BACKGROUND
On March 8, 1993,the City of Upland and San Bernardino County Association of Governments,which is now known as San Bernardino County Transportation Authority (SBCTA), entered into a Station Cooperative Agreement as tenants in common for the Santa Fe Depot buildings and parking lots (non-operating property). The Station Cooperative Agreement between the City and SBCTA provides the City with the authority to enter into agreements, including the subject Lease Agreement for 220 E.A Street,and site improvements on behalf of both parties,provided the Station's parking is maintained at 227 parking spaces.

In 2005, the City and SBCTA collaborated to restore the Santa Fe Depot building (the "Depot Building"). The rehabilitation of the Depot Building created two tenant spaces comprising the current Pacific Wine Merchant's tenant space(210 E. A Street),which is 2,450 square feet in size and a patio that is 624 square feet. The other tenant space and the subject of the proposed Lease Agreement was previously occupied by Sweet Obsession Cheesecake(220 E.

A Street),which is 1,250 square feet in size and a patio that is 450 square feet.

Sweet Obsession Cheesecake vacated the tenant space in August 2023. Prior to marketing the vacant space, staff subsequently completed improvements to create a better leasable space by moving the southerly entrance to the east side of the building, so there is direct access to the patio area from within the tenant space. An additional shade sail and pole was added so the entire patio area was covered.

ISSUES AND ANALYSIS
Laura Cayley and her business partner Isidro Gutierrez(Tenants)expressed interest in leasing the space and submitted a proposal for a long-term lease.They are proposing to develop a 42"d Street Bagel store within 220 E.A Street,and would sell bagels and cream cheese, bagel sandwiches, breakfast sandwiches, soups, salads, and beverages. Their vision is to create a space for the local community, senior citizens, Metrolink Riders, and visitors to meet, eat and socialize. They also intend to establish a delivery service to local professional offices/medical offices and the local hospitals using platforms such as:Door Dash,Uber Eats,and/or Chow Now.

Laura and Isidro have a combined 50 years of restaurant ownership, management, and operation experience. Laura Cayley is the owner of Viva Madrid,which has been open for 27 years in Claremont and is part-owner of 42"d Street Bagel in Claremont, as well as Petiscos in Claremont.Isidro Gutierrez is part-owner of Union on Yale in Claremont and The Back Abbey with Claremont and Upland locations.He has worked in the restaurant industry for 20 years.

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Under the terms of the Lease Agreement,42'Street Bagel Upland,Inc. will lease the tenant space at 220 E.A Street for $2,000 per month. The rent will commence six (6) months after the execution of the lease, which is due on September 1,2025,and is prorated at$1,333.33.The October rent will be the full amount of$2,00.00 and thereafter.

The tenant's monthly rent amount will increase annually by 3%on the commencement date. The original lease term will be for a period of 5 years with the tenant's option to extend the initial term by four(4) additional periods of 5- years each.

During the first two years,the tenant anticipates investing in the space over$330,000 in major tenant improvements for the restaurant which includes the installation of a grease interceptor,a bagel boiler, and a new hood and sink.

The City,as the lease administrator,will provide lease management services and monitor the space occupied by 42°d Street Bagel Upland,Inc. for the length of the Lease Agreement. The Lease Agreement is attached to this report for the City Council's review.The following is a summary of the key terms of the Lease Agreement:

Initial Rent Year 1: $2,000 per month,commencing 6 months after the execution of the lease Monthly Rent Year 2: $2,060 per month
Annual Escalator: 3%annual increase
Term: 5-year initial term,with four,5-year extensions Insurance: $2 Million General Liability; $1 Million Workers Comp/Employer Liability Utilities: Paid by Tenant
Possessory Interest Tax: Paid by Tenant
Holding Over: 150% of the monthly rent in effect

ENVIRONMENTAL DETERMINATION
The project is determined to be Categorically Exempt from the California Environmental Quality Act (CEQA) pursuant to Section 15301 (Existing Facilities) of the CEQA Guidelines. The project consists of leasing an existing commercial tenant space,involving no expansion of use,for the purpose of operating a restaurant which was also the previous use of the space.

FISCAL IMPACTS
For the initial term year, the Lease Agreement will provide $2,000 per month revenue to the City's General Fund.

The tenant's monthly rent amount will increase annually on the commencement date by an escalator of 3%. The rent will commence six(6)months after the execution of the lease. The first month's rent will be due September 1,2025 and prorated, which will be $1,333.33 with revenue deposited into Economic Development Lease of City Property Account No. 1012203-4802.

ALTERNATIVES
Provide alternative direction to staff.

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

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Lease Agreement
(Santa Fe Depot)
THIS LEASE AGREEMENT (this "Lease") is dated and entered into as of February 27, 2025, by and between the CITY OF UPLAND, a California municipal corporation ("City"),and 42'"'STREET BAGEL,Upland,a California Corporation,("Tenant"), with respect to the following:

RECITALS:

A. City and San Bernardino Associated Governments, acting solely in its capacity as the San Bernardino County Transportation Commission(SANBAG),a public agency existing under the authority of the laws of the State of California, as tenants in common pursuant to that certain.

Cooperative Agreement dated March 8, 1993 executed by City and SANBAG(as amended from time to time, the"Cooperative Agreement", are the owners of that certain real property located in the City of Upland, County of San Bernardino, State of California, and more particularly described on Exhibit A attached hereto(the "Property").

B. On January 1, 2017,the San Bernardino County Transportation Authority(SBCTA) became the successor agency to SANBAG.

C. City and SBCTA, as the successor to SANBAG, acquired the Property as tenants in common by Grant Deed dated May 15,2019,and recorded on July 1,2019 at the San Bernardino County Recorder's Office.

D. The Cooperative Agreement between SBCTA and City provides City with the right and authority to enter into agreements, including this Lease, with respect to the Property on behalf of both City and SBCTA.

AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, City and Tenant agree as follows:

1. PREMISES. City hereby leases to.Tenant and Tenant hereby leases from City,the approximately one thousand two hundred and fifty (1,250). square foot portion of the building outlined on Exhibit B attached hereto(the "Premises") and identified as 220 East"A" Street in the City of Upland. In addition, City hereby leases to Tenant and Tenant hereby leases from City, the approximately four hundred and fifty (450) square foot portion of the patio area immediately connected to the Premises on the east as outlined in Exhibit B. Prior to possession of the Premises, the City will repair the roof for minor leak repairs. City makes no warranties or representations,express or implied,written or oral,regarding the condition, status, compliance of laws of the Premises or suitability for a particular purpose for Tenant's use. Tenant shall take possession of the Premises, if at all, in its "as is" condition; provided, however, that Tenant can elect to terminate this Lease by giving written notice thereof to City at any time at least seven (7) days before the "Rent Commencement Date'' (as defined below) if Tenant reasonably determines that the condition of the Premises is not acceptable.

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CASp Disclosure. Landlord discloses that the Premises have not undergone inspection by a Certified Access Specialist as referenced in California Civil Code Section 1938 subsection(e) of which provides: "A Certified Access Specialist (CASp) can inspect the subject premises and determine whether the subject premises comply with all of the applicable construction-related accessibility standards under state law. Although state law does not require a CASp inspection of the subject premises,the commercial property owner or lessor may not prohibit the lessee or tenant from obtaining a CASp inspection of the subject premises for the occupancy or potential occupancy of the lessee or tenant,.if requested by the lessee or tenant. The parties shall mutually agree on the arrangements for the time and manner of the CASp inspection,the payment of the fee for the CASp inspection, and the cost of making any repairs necessary to correct violations of construction- related accessibility standards within the premises." In connection with the foregoing Section 1938(e), Tenant acknowledges and agrees that, if Tenant elects to have the Premises inspected by a CASp: (i)it must notify Landlord of the election on or before the date when Tenant executes this.

Lease; (ii) the inspection will be at Tenant's sole cost and-expense; (iii) the inspection must be scheduled through Landlord's office in coordination with the n-site property manager; (iv) any repairs or modifications necessary to correct any violation of construction-related accessibility standards that is noted in the CASp report shall be the responsibility of Tenant; and(v)a copy of the CASp report must be furnished to Landlord upon its completion. By initialing below, the person(s) executing this Lease on behalf of Tenant, represent that:

Tenant does wish to have a CASp inspection of the Premises -- Initials:

Tenant hereby waives its right to have a CASp inspection of the Premises -- Initials: LC/IG `ice' 2

2. TERM; EXTENSION OPTIONS. The initial term of this Lease shall be five (5) years, commencing on March 10, 2025 ("Commencement Date") and terminating at 11:59 p.m., March 9,2030.Provided that Tenant is not in default under this Lease beyond any applicable cure period at the time of exercise of an option to extend described below or at any time thereafter prior to the commencement of the applicable "Option Term" (as defined below), Tenant shall have the option to extend the initial term of this Lease, subject to agreement between Tenant and City as to the amount of rent for the Option Terms (see Section 3.2), for four(4) additional periods of five(5) years each(each such period being referred to herein as an "Option Term")only by giving, City notice at least twelve (12) months before the expiration of the initial term or first Option Term,as applicable.If agreement on the amount of rent for the either Option Term is not reached prior to the commencement of the Option Term, the Lease shall terminate at the expiration of the initial term or first Option Term as applicable. All of the terms, covenants, conditions, provisions and agreements applicable to the initial term shall be applicable to the Option Terms...

3. RENT. Commencing 180 days after the execution of the Lease by the City (Rent Commencement Date)Tenant shall pay rent to City as follows:

3.1 Monthly Rent. Tenant shall pay to City as monthly rent, without deduction, setoff,notice or demand, the sum of Two Thousand Dollars ($2,OOO.00),which sum is subject to adjustment as provided in Section 3.2, per month in advance on the first day of each month, commencing on the Rent Commencement Date and continuing during.the Term. The total monthly rent is based on a starting rate of$1.60 per square foot for the tenant space. The first month's rent will be due on September 1,2025 and prorated. The first month's rent will be$1,333.33.

3.2 Annual Adjustment of Monthly Rent. The monthly rent described in

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Section 3.1 shall be increased by three percent (3%) on the first anniversary of the Rent Commencement Date and by another three percent (3%) on each subsequent anniversary of the Rent Commencement Date during the Term (See attached Rent Schedule in. Exhibit D).

However, the amount of the rent for either Option Terms shall be agreed to prior to the commencement of each Option Term in an amount equal to, greater than or less than the 3% increase each year as indicated in Exhibit D. The rent on any Option term will not be increased more than 5%.

3.3 Security Deposit. A non-refundable deposit of Two Thousand Dollars shall be due to the Landlord on the date of execution of this lease._ City shall not be obligated to pay interest on the Security Deposit. City may apply the Security Deposit to any of Tenant's obligations under this Lease, and if City does so, then Tenant shall deposit additional funds with City within ten(10) days after written demand to replenish the Security Deposit. No such application of the Security Deposit shall be deemed a cure or waiver of the applicable default. City shall return any unapplied portion of the Security Deposit to Tenant within 120 days after the expiration or earlier termination of this Lease, but if this Lease is terminated by City based on a default by Tenant and Tenant disputes the amount owed by Tenant, City may retain unapplied portions of the Security Deposit until the dispute is finally resolved. TENANT HEREBY WAIVES THE PROVISIONS OF SECTION 1950.7 OF THE

CALIFORNIA CIVIL CODE AND AGREES THAT THE FOREGOING PROVISIONS OF THIS SECTION 3.3 SHALL GOVERN THE CITY'S USE AND RETURN OF THE SECURITY DEPOSIT.

4. USE; CONTINUOUS OPERATION. From and after the Rent Commencement Date/Occupancy Date, Tenant shall use the Premises solely for the purpose of operating a full- service restaurant selling bagels, cream cheese, bagel sandwiches, breakfast sandwiches, soups, salads,and beverages. Tenant shall not use or permit the Premises to be used for any other purpose without the written consent of City, which may be withheld in City's sole and absolute discretion.

Tenant shall continuously conduct its business activity in the Premises during all normal business days and hours, unless prevented from so doing by strikes, fire, casualty or other causes beyond Tenant's control, and except during reasonable periods for repairing, cleaning, and decorating the Premises.

5. COMMON AREA, The term "Common Area" shall mean all areas within the exterior boundaries of the Property,except the Premises,the remainder of the building and any other portion of the Property demised by City to any other person or entity. Tenant acknowledges and agrees that the parking area and facilities within the Common Area may, at City's sole and absolute option and in accordance with applicable laws and governmental requirements, be available and open to the general public for parking. Tenant further acknowledges and agrees that City shall have the right to (I) utilize any portion of the Common Area for promotional, entertainment and related matters; (ii) place permanent or temporary kiosks, displays, carts and stands in the Common Area and to lease the same to tenants; (iii)restrain the use of the Common Area by unauthorized persons; (iv)temporarily close any portion of the Common Area for repairs, improvements or alterations, to discourage non-customer use, to prevent dedication or an easement by prescription or for any other reason deemed sufficient in City's reasonable judgment; and (v) renovate, upgrade or change the shape and size of the Common Area or add, eliminate or change the location of improvements to the Common Area including buildings, parking areas, roadways and curb cuts, and to construct buildings on the Common Area. Na changes made to the Common Area by City pursuant to this Section 5 shall materially and adversely affect access to,or visibility of,the Premises or parking therefore unless Tenant has consented to the same (which consent shall not be unreasonably withheld, conditioned or delayed).

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6. ALTERATIONS AND IMPROVEMENTS.

6.1 Any improvements constructed or placed on the Premises by Tenant shall become the property of City at the time of such construction or placement and shall remain the property of City after termination or expiration of this Lease.

6.2 City agrees that Tenant may, at its sole cost and expense, make alterations, additions, and changes in and to the interior of the Premises provided that the value of any structure or improvements then on the Premises is not thereby diminished,and provided,further, that no such alterations, additions or changes which affect the structure of the Building utilities may be made without first procuring the written approval of City,which shall be conditioned on Tenant's payment of such alterations.Additionally,no alterations,additions,or changes shall be made to the fronts, exterior walls, or roof of the Premises, unless and until the written approval of City shall have been obtained first. All alterations, additions, or changes to be made to the structure or improvements on the Premises shall be under the supervision of a competent architect or competent licensed structural engineer and made in accordance with the plans and specifications with respect thereto,approved by City before the commencement of work and all work must be done in a good and workmanlike manner and diligently prosecuted to completion. Tenant shall keep the Premises free and clear of any liens or encumbrances which may arise from such work..

6.3 Notwithstanding any obligations of City under the terms of this Lease or applicable law to repair, maintain or replace any portion of the Premises, the building o r any utility systems serving the Premises or the building, Tenant shall at all times be solely responsible for all damage caused by Tenant's alterations, additions, improvements or changes to the Premises,building or such systems and for all damages and conditions(such as leaks in the roof, or drainage problems)resulting directly or indirectly therefrom and Tenant shall make all necessary repairs at Tenant's sole cost and expense. At Landlord's option, Tenant shall, at its sole cost and expense,remove all such additions, alterations, and improvements from the Premises at the end of the term hereof and repair any damage to the Premises occasioned by such removal If Tenant shall fail to complete such removal and repair such damage within ten (10)days after such termination, Landlord may do so and Tenant shall pay the reasonable cost thereof as additional rent within ten (10)days after Landlord shall render to Tenant a written statement therefor.

7. MAINTENANCE. Tenant, at its sole cost and expense, shall at all times maintain in good order, condition, cleanliness, and repair, the Premises and every part thereof, including all plumbing, heating, air-conditioning and electrical facilities, grease traps, and equipment within or serving the Premises, fixtures, interior walls, and interior surface of exterior walls, ceilings,store front,windows,interior doors,plate glass,showcases,entrances,vestibules and potted landscape located within the Premises, sidewalks adjacent to the Premises, and any trash areas assigned to Tenant. If Tenant fails to promptly make any necessary repairs,or maintain cleanliness as provided for in this Lease, City shall have the right to make such repairs or provide cleaning service and Tenant shall pay the cost plus Ten-Percent (10%) thereof as additional rent. Tenant agrees to pay Twenty-Five Percent (25%) of the cost associated with the exterior repairs or maintenance to painted surfaces, downspouts, gutters, railings, exterior entry doors, light fixtures and shades. Conversely, the City shall pay for repairs or maintenance to structural, roofs, the sewage system, plumbing and utilities outside the building and in or under the floor of the Premises. However, as to all items for damage caused by any act or omission of Tenant or its

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customers, employees, agents, invitees, licensees, or contractors (including any damage or other problems caused by Tenant's disposal of waste), Tenant shall be One-Hundred-Percent (100%) responsible for repairs for said damage. Tenant hereby waives California Civil Code Sections 1932(1), 1941 and 1942 and any other applicable existing or future law, ordinance or governmental regulation permitting Tenant to make repairs at Landlord's expense.

S. USES PROHIBITED. Tenant shall not do or permit anything to be done in or about the Premises nor bring or keep anything therein which will in any way increase the existing rate of or affect any fire or other insurance upon the building or any of its contents, or cause a cancellation of any insurance policy covering the building or any part thereof or any of its contents. Tenant shall not do or permit anything to be done in or about the Premises which will in any way obstruct or interfere with the rights of other tenants or occupants of the building or injure or annoy them or use or allow the Premises to be used for any improper, immoral, unlawful or objectionable purpose;nor shall Tenant cause,maintain or permit any nuisance in, on or about the Premises. Tenant shall not commit or allow to be committed any waste in or upon the Premises. Tenant shall not conduct or permit to be conducted any sale by auction, in, upon or from the Premises whether such auction be voluntary, involuntary, pursuant to any assignment for the payment of creditors or pursuant to any bankruptcy or other insolvency proceeding.

9. HOURS. The Premises shall not be open for business between the hours of 12:00 a.m. and 4:00 a.m. on any day.

10. LIENS. Tenant shall keep the Premises and the Building free from any liens or stop notices arising out of any work performed, materials furnished or obligations incurred by or on behalf of Tenant. City may require, at City's sole option, that Tenant shall provide to City, at Tenant's sole cost and expense, a payment and completion bond in an amount equal to one and one-half (1..5) times the estimated cost of any improvements, additions, or alterations in the Premises that Tenant desires to make, to insure City against any liability for mechanics' and materialmen's liens or stop notices and to insure completion of the work.

11. ASSIGNMENT AND SUBLETTING. Tenant shall not either voluntarily, or by operation of law, assign, transfer, mortgage, pledge, hypothecate or encumber this Lease or any interest- herein, or any- right or privilege appurtenant hereto, or allow- any other person (the employees, agents, servants and invitees of Tenant excepted) to occupy or use the Premises, or any portion thereof, without first obtaining the written consent of City, which consent may be withheld in City's sole and absolute discretion (except as otherwise provided in Section 22). In considering whether or not to grant such consent,Landlord may consider, among other things,the proposed tenant's character, credit, and professional standing. A consent to one assignment,.. subletting, occupation or use by any other person shall not be deemed to be a consent to any subsequent assignment, subletting, occupation or use by another person. Consent to any such assignment or subletting shall in no way relieve.Tenant of any liability under this Lease..Any such assignment or subletting without such consent shall be void, and shall, at the option of City, constitute a default under this Lease. If Tenant is a partnership or joint venture or limited liability company, a withdrawal, addition, or change(voluntary,involuntary,by law, or otherwise)of any of the partners or venturers thereof, or if Tenant ig composed. of more than one person,_a purported:
assignment for transfer(voluntary or involuntary,by operation of law,or otherwise)from one there of unto the other or others. thereof, of if Tenant is. a .corporation, a change in the ownership (voluntary or involuntary, by operation of law, or otherwise) of one-third (1/3) or more of its capital,stock owned as of the execution of this Lease shall be deemed an assignment prohibited hereby. Any assignment or subletting not in compliance with the provisions of this paragraph

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shall be a material breach of the Lease, voidable and, at Landlord's option, shall terminate this Lease.

12. LATE PAYMENT CHARGE; INTEREST. Interest will accrue at the lesser of ten percent (10%) per annum or the maximum rate permitted by law on any and all sums not paid when due hereunder. Additionally, a late payment charge of five percent (5%) of any rent or other amount required to be paid by Tenant to City hereunder shall be paid by Tenant if such payment is not paid to. City on or before the tenth (10th). day after payment is due. The parties hereby agree that such late charge represents a fair and reasonable estimate of the costs City will incur by reason of late payment by Tenant. Acceptance of the late charge by City shall not constitute a waiver of Tenant's default with respect to the overdue amount,nor prevent City from exercising any of the other rights and remedies available to City.

13. INDEMNIFICATION.

13.1 Waiver of Claims. To the extent permitted by law, Tenant waives all claims against Landlord for damage to person or property arising for any reason. Tenant assumes all such risks for Tenant and any employees, licensees, invitees, agents, or contractors:

13.2 General Indemnity. Tenant shall indemnify and hold harmless City, the City • Council and each member thereof, and City's officers, employees and agents (collectively "Indemnitee") against and from any and all claims, losses, liabilities, costs and expenses (including attorneys' fees and costs) arising from Tenant's use of the.Premises or from the conduct of its business or from any activity, work, or other things done, suffered by Tenant in or about the Premises, and shall further indemnify and hold harmless Indemnitees against and from any and all damages, injuries, response costs, demands, debts, liens, fines, charges, penalties, causes of action, snits, legal or administrative proceedings, claims, losses, liabilities, costs and expenses(including attorneys'fees and costs)arising from any breach or default in the performance of any obligations on Tenant's part to be performed under the term of this.Lease, or arising from any act or negligence of Tenant, or any officer, agent, employee, guest, or invitee of Tenant. If any action or proceeding he brought against Indemnitees by reason of any such claim. Tenant, upon notice from Indemnitees, shall defend Indemnitees at Tenant's expense, by counsel reasonably satisfactory to Indemnitees. Tenant, as a material part of the consideration to City, hereby assumes all risk of damage to property or injury to persons in, upon or about the Premises, from any cause other than City's gross negligence and Tenant hereby waives all claims in respect thereof against City. Tenant shall give prompt notice to City in case of casualty or accidents in the Premises.Neither City nor its agents shall be liable for any loss or damage to persons or property resulting from tire, explosion, falling plaster, steam, gas, electricity, water or any other cause whatsoever, unless caused by or due to the gross negligence of City, its agents, servants or employees.Neither City nor its agents shall be liable for interference with the light, air, or for any latent defect in the Premises.

14. INSURANCE.

14.1 Liability. Tenant agrees that at all times during the term of this Lease and any renewal or extension thereof, it shall at Tenant's expense maintain in force insurance policies which will insure and indemnify Tenant, City and the other Indemnitees against liability or financial loss resulting from any suits, claims or actions and from all costs and expenses of litigation, in an amount of not less than Two Million Dollars ($2,000,000) combined single limit

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for any injury to persons and/or damage to property in or about the Premises by reason of the use and occupation by Tenant or by any other person or persons of the Premises together with an endorsement as set forth in the standard City Certificate of Insurance. Such insurance shall include contractual liability coverage with respect to Tenant's obligations under Section 13.Not more frequently than once each year, if, in the opinion of the insurance broker or consultant retained by City, the amount of public liability and property damage insurance coverage at that time is not adequate, Tenant shall increase the insurance coverage as required by City's insurance broker or consultant. Tenant shall also maintain worker's compensation coverage in an amount adequate to comply with law, and employer's liability coverage with a limit of not less than One Million Dollars ($1,000,000).

14.2 Fire/Casualty. Tenant shall, at Tenant's cost and expense, obtain and at all times during the term hereof maintain in effect, insurance covering (1) the improvements to the Premises made by or on behalf of Tenant, (2) Tenant's boilers and machinery, if any; (3) trade fixtures, furnishings, equipment, and inventory of merchandise located in the Premises; (4) all alterations, additions, and changes,made in,or to the Premises during the term of this Lease; and (5) all plate glass, providing protection to the extent of not less than ninety percent(90%) of the insurable value of all such items against any peril included under insurance industry practices in the jurisdiction of the Premises within the classification "fire and extended coverage," together with insurance against vandalism, malicious mischief, and sprinkler leakage or other sprinkler damage, if sprinklers are installed, and including "use and occupancy" and/or "business interruption" coverage. Tenant hereby waives any and all rights of recovery against City for any loss occurring to such items on account of fire or other casualty, and such policies of insurance shall contain appropriate provision recognizing this release by Tenant and.waiving all right of subrogation by the insurance carrier. The proceeds of such insurance, so long as this Lease remains in effect, shall be used to repair or replace the items so insured in the event of loss on account of fire or other casualty.

14.3 Certificates. Such policies shall he issue d by an insurer rated in Best's Insurance Guide with a financial rating of A or better. Such policies shall provide that the insurance coverage shall not be cancelled or reduced by the insurance carrier without City having been given thirty (30) days' prior written notice thereof by such carrier. Tenant agrees that it will not cancel or reduce such insurance coverage. At all times during the term of this Lease and prior to taking possession of the Premises, Tenant shall provide the City Clerk with a Certificate from the insurance carrier or carriers showing such insurance policies are in effect in the amounts above provided, and if requested, a copy of each insurance policy. Notwithstanding any other provision to the contrary contained in this Lease, Tenant shall not have the right to take possession of the Premises until such certificate or certificates and insurance policies are filed with the City Clerk.

14.4 Lapsed Insurance. Tenant agrees that if it does not keep such insurance in full force and effect, City may take out the necessary insurance and pay the premium thereon and the repayment thereof shall be deemed to be a part of the rental of the Premises in addition to the usual monthly rent and payable as such on the next day after the payment by City for such insurance policy upon which rent becomes due hereunder.

14.5 Waiver of Subrogation. Tenant and Landlord hereby waive and release each other of and from any and all rights of recovery, claims, actions, or causes of action against each other, including their respective employees, officers, directors, subsidiaries, affiliates, agents, or representatives to the extent covered by the insurance carried hereunder. The Insurance policies

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must be endorsed to reflect the insurer's acceptance of this waiver of subrogation. The waiver of subrogation applies whether or not there are any deductibles or self- insured retentions and in the absence of any insurance.

15. UTILITIES. Tenant shall be responsible for contracting for all utility services required by Tenant at the Premises, and Tenant shall ensure, at Tenant's cost, that the Premises are separately metered for all utilities and shall install such meters and related equipment as may be necessary to do so, Tenant agrees to pay before delinquency every charge, lien or expense accruing or payable during the term of this Lease in connection with the use of the Premises including electricity, gas, water, telephone, utilities, waste disposal and other services used by Tenant on the Premises. If any such charge, lien or expense is not paid when due, City may pay the same,and any amount so paid by City shall be paid by Tenant to City upon demand as additional rent.

16. SIGNS. Tenant shall not, without obtaining City's written approval; install or affix any lighting or plumbing fixtures, shades, awnings, or decorations (including exterior painting), signs, lettering,placards, or the like on the exterior of Premises;display or sell merchandise on, or otherwise obstruct, any area outside the exterior walls of the Premises; or cause or permit to be used any advertising, loudspeakers, unusually bright or flashing lights, and similar devices which may be seen or heard outside the Premises. Tenant shall at all times maintain show windows and signs on the Premises in a neat, clean and orderly condition. If any exterior sign needs maintenance, repair, cleanup, or repainting and Tenant shall fail to do so after ten(10) days'notice from City, City may repair, repaint, clean, or maintain such exterior sign and the cost thereof shall be payable by Tenant to City as additional rent.

17. COMPLIANCE WITH LAW/HAZARDOUS MATERIALS.

17.1 Compliance. Tenant, at its expense, shall comply promptly with all applicable laws, ordinances, regulations, and orders of any governmental authority pertaining to the Premises or Tenant's use or occupancy of the Premises or improvement of the Premises(including laws, ordinances, regulations and orders pertaining to non-structural improvements required by law, the location and maintenance of trade fixtures, equipment, and other personal property; the conduct of Tenant's employees; preparation, storage, and service of food and drink, including alcoholic beverages, and the like, but excluding new laws or changes in laws that require improvements to the structural components of the Premises).

17.2 Hazardous Materials. Tenant shall not cause or permit any Hazardous Materials, as defined below, to be brought upon,kept, used, discharged, deposited or leaked in or about the Premises or the Property by Tenant or any of Tenant's agents or by anyone in the Premises (other than Landlord or its agents, employees or contractors), except to the extent such Hazardous Materials are cleaning or office supplies customarily kept or used by typical office tenants and are kept and used in accordance with all applicable laws. If Tenant breaches the obligations stated in the preceding sentence, or if the presence of any Hazardous Material on the Premises or the Building caused or suffered or permitted by Tenant or any of Tenant's agents or by anyone in the.

Premises (other than Landlord or its agents, employees or contractors)results in contamination of the Premises or the Building, or if contamination of the Premises or the Property by any Hazardous Material otherwise occurs for which Tenant is legally liable, then Tenant shall indemnify, defend and hold Landlord harmless from any and all claims, damages, costs, liabilities and expenses Page$of 19

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(including,without limitation,diminution in value or use of the Building,attorneys'fees,consultant fees and expert fees)which arise during or after the Term as a result of such contamination. This indemnification shall include, without limitation, costs incurred in connection with any investigation of site conditions or any clean-up,remedial,removal or restoration work on or under the Premises. "Hazardous Material" means any hazardous or toxic substance, material or waste which is or becomes regulated by any local,state or federal governmental authority or by common law decisions, including without limitation(i) all chlorinated solvents, (ii) petroleum products or by-products, (iii) asbestos and(iv)polychlorinated biphenyls.

18. RIGHT OF ACCESS. City and its officers, employees, and agents shall at all reasonable times (except in the event of an emergency in which case City shall be permitted access at any time)have the right to enter the Premises for the purpose of inspecting the same, posting notices of non-responsibility or any other notices required by law for the protection of City,doing any work that City is permitted or required to perform under this Lease,and making any reasonable repairs which City determines may be required. Tenant shall furnish City with a pass key to the Premises that City shall use only in case of emergency to prevent or investigate a crime, or in such cases where access is necessary to prevent damage to the building or to the.Premises or to make repairs necessary to ensure continuous operation of the building. City shall have the right to enter the Premises and post "For Lease" or "For Rent" signs in the windows of the Premises during the last six(6)months of the term, or during arty period while Tenant is in default. In conducting its activities on the Premises as allowed in this Section 18, City shall attempt to minimize the inconvenience, annoyance, or disturbance to Tenant; however, City shall not be liable in any manner for any inconvenience, disturbance, loss of business, nuisance, or other damage arising out of City's entry on the Premises as provided in this section, except damage resulting from the negligent or intentional wrongful acts or omissions of City or its authorized representatives acting in their proprietary(not governmental)capacities. Tenant shall not be entitled to an abatement or reduction of Rent if City exercises any rights reserved in this section.

19. TAXES. Tenant shall pay or cause to be paid, before delinquency, any and all taxes, levied and assessed which become payable during the term hereof against its interest in the Premises, upon all Tenant's leasehold improvements, equipment, furniture, fixtures, and any other personal property located in or on the Premises, or which become a lien against the Premises or Tenant's interest therein or its property thereof. Tenant recognizes and understands that this Lease may create a possessory interest subject to property taxes levied upon such interest.

20. RULES AND REGULATIONS. Tenant-shall faithfully observe and comply with the rules and regulations that City shall from time to time promulgate and/or modify. The rules and regulations shall be binding upon Tenant upon delivery of a copy of them to Tenant. City shall not be responsible to Tenant for the nonperformance of any such rules and regulations by any other lessees or occupants of the building.

21. TENANT'S DEFAULT. The occurrence of any one or more of the following events shall constitute a default and breach of this Lease by Tenant: (a) the vacating or abandonment of the Premises by Tenant; (b) the failure by Tenant to make any payment of rent or any other payment required to be made.by Tenant hereunder, as and when due, where such failure shall continue for a period of three (3) days after notice thereof by City to Tenant; (c) the failure by Tenant to observe or perform any of the covenants,conditions or provisions of this Lease to be observed or performed by Tenant, other than as described elsewhere in this Lease where such failure shall continue for a period of thirty(30) days after notice thereof by City to Tenant;

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provided, however,that if the nature of Tenant's default is such that more than thirty (30)days are reasonably required for its cure, then Tenant shall not be deemed to be in default if Tenant commences such cure within such thirty (30) day period and thereafter diligently prosecutes such cure to completion; (d) the making by Tenant of any general assignment or general arrangement for the benefit of creditors; or, unless prohibited by Bankruptcy Law or other paramount law,the filing by or against Tenant of a petition to have Tenant adjudged a bankrupt, or a petition or reorganization or arrangement under any law relating to bankruptcy (unless, in the case of a petition filed against Tenant, the same is dismissed within sixty (60) days); or the appointment of a trustee or a receiver to take possession of substantially all of Tenant's assets located at the Premises or of Tenant's interest in this Lease, where possession is not restored to Tenant within thirty(30)days;or the attachment, execution or other judicial seizure of substantially all of Tenant's assets located at the Premises or of Tenant's interest in this Lease,where such seizure is not discharged within thirty (30) days; or (e) a violation by Tenant of Section 11 (or the occurrence of an event which is described in Section i 1 as a default by Tenant).

22. REMEDIES UPON TENANT DEFAULT. In the event of any such default or breach by Tenant, City may at any time thereafter, in its sole discretion, with or without notice or demand and without limiting City in the exercise of a right or remedy which City may have by reason of such default or breach: (a) terminate Tenant's right to possession of the Premises by notice to Tenant, in which case this Lease shall terminate and Tenant shall immediately surrender possession of the Premises to City. In the event of termination, City shall be entitled to recover from Tenant all damages incurred by.City by reason.of Tenant's default including the cost of recovering possession of the. Premises; expenses of reletting, including necessary renovation and alteration of the Premises; reasonable attorneys' fees; the worth at the time of award by the court having jurisdiction thereof of the amount by which the unpaid rent and other charges and adjustments called for herein for-the balance of the term after the time of such award exceeds the amount of such loss for the same period that Tenant proves could be reasonably avoided; and that portion of any leasing commission paid by City and applicable to the unexpired term of this Lease. Unpaid installments of rent or other sums shall bear interest from the date due at the maximum legal rate; or(b)keep this Lease in effect and sue for rent as it comes due, in which case Tenant shall have the right to sublet the Premises subject to City's consent, which will not be unreasonably withheld. In such event City shall be entitled to enforce all of City's rights and remedies under this Lease, including the right to recover the rent and any other charges and adjustments as may become due hereunder; (c)pursue any other remedy now or hereafter available to City under the laws or judicial decisions of the State of California.

23. , DEFAULT BY CITY, City shall not be in default unless City fails to perform obligations required of City within thirty(30)days.after notice by Tenant to City specifying wherein City has,failed to perform such obligation; provided, however, that if the nature of City's obligation is such that more than thirty (30)days are require d for performance then City shall not be in default if City commences performance within such thirty (30) day period and thereafter diligently prosecutes the same to completion, In no event shall Tenant have the right to terminate this Lease as a result of City's default and Tenant's remedies shall be limited to damages and/or an injunction.

24. . DAMAGE; RECONSTRUCTION, In the event the Premises are damaged by fire or other perils covered by extended coverage insurance, City agrees to repair the damage, and this Lease shall remain in full force and effect, except that Tenant shall be entitled to a reduction of the rent from the date of damage and while such repairs are being made, such reduction to be based upon the extent to which the damage and making of such repairs interfere with the business

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carried on by Tenant in the Premises; however, if the damage is due to the fault or neglect of Tenant or i-ts employees,there shall be no abatement of rent..In the event the Premises are damaged. as a result of any cause other than the perils covered by fire and extended coverage insurance,City shall repair the damage provided the extent of the destruction is less than ten percent(10%)of the then full replacement cost of the Premises. In the event the destruction of the Premises is to an extent of ten percent(10%) or more of the full replacement cost of the Premises, then City shall have the option: (a) to repair or restore such damage, this Lease continuing in full force and effect, but the rent to be proportionately reduced as provided above in this Section;or(b).give notice to Tenant at any time within sixty(60) days after such damage, terminating this Lease as of the date specified in such notice, which date,shall be no more..than thirty (3.0) days after the giving o.f such notice. In the event of giving such notice, this Lease shall expire and all interest of Tenant in.the Premises shall terminate on the date so specified in such notice and the rent, reduced by a proportionate reduction, based upon the extent, if any, to which such damage interfered with the business carried on by-Tenant in the Premises, shall he paid up to date of such termination. If the building is damaged by any casualty and the cost of repair exceeds twenty-five percent (25%) of the then replacement value of the building,City can elect within sixty(60) days of the destruction to terminate this Lease upon notice to Tenant whether or not the Premises are destroyed.

Notwithstanding anything to the contrary contained in this Section, City shall not have any obligation whatsoever to repair,. reconstruct or restore the Premises when the damage resulting from any casualty covered under this Section 24 occurs during the last twenty-four months of the term of this Lease or any extension thereof City shall not he required to repair any injury or damage by, fire or other cause, or to make any repairs or replacements of any leasehold improvements, fixtures, or other personal property of Tenant.

25. EMINENT DOMAIN. If more than twenty-five percent (25%) of the Premises shall. be taken or appropriated by any authority under the power of eminent domain, either party hereto shall have the right, at its option, within sixty (60) days after such taking,.to terminate this Lease upon thirty (3.0).days'notice. If either less,than or more than twenty-five percent(25%) of the Premises are taken (and neither party elects to terminate as herein provided), the rent thereafter to be paid shall be equitably reduced. If any part of the building other than the Premises is so taken or appropriated, City shall within sixty (60) days of such taking have the right at its option to terminate this Lease upon notice to Tenant. In the event of any taking or appropriation whatsoever, City shall be entitled to any and all awards and/or settlements which may be given and Tenant shall have no claim against City for the value of any unexpired term of this Lease or any other sums, except that if City is the condemning party, and City is condemning any of Tenant's rights or interests under this Lease, Tenant shall be entitled to all condemnation awards awarded to Tenant in the applicable condemnation proceeding.

26. PAYMENTS AND NOTICES. All rental payments hereunder shall be paid by Tenant to the City of Upland at 460 North Euclid Avenue, Upland, California 91786, or at such other address or to such other persons as City may from time to time designate, and all notices delivered (separately) to the City Clerk and to the City Manager at 460 North Euclid Avenue, Upland, California 91786, or at such other addresses or to such other persons as City may from time to time designate.

27. SUCCESSORS.Each and every one of the terms,covenants,and conditions of this Lease shall inure to the benefit of and shall bind,as the case may be;not only the parties hereto but each and every one of the heirs, executors, administrators, successors, assigns, and legal representatives of the parties hereto; provided, however, that any subletting or assignment by Tenant of the whole or any part of the Premises or any interest therein shall be subject to the provisions of Section 11.

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28. HOLDING OVER. If Tenant, with City's consent, remains in possession of the Premises after expiration or termination of the term, or after the date in any notice given by City to Tenant terminating this Lease, such possession by Tenant shall be deemed to be tenancy at will (or as otherwise expressly agreed by City in its consent), terminable upon notice given at any time by either Party, at a monthly rental equal to one hundred fifty percent (150%) of the monthly rental in effect immediately prior to expiration or termination.All provisions of this Lease except those pertaining to rent and term shall apply to the tenancy.

29. NOTICE PRIOR TO EXPIRATION; SURRENDER, At the expiration or termination of the. Term, Tenant shall surrender the Premises to City in the..same condition as received, reasonable wear and tear excepted, and all structures and improvements constructed thereon; provided, however, that City may elect to require Tenant to remove Tenant's alterations, at Tenant's sole cost and expense, prior to the expiration of the Term or within thirty (30) days after any earlier termination of the Term by notice given at least fifteen (15) days prior to the expiration of the Term or concurrently with City's termination notice, as applicable.

3.0. . SUBORDINATION. At the option of City,this Lease shall be.either subordinate or superior to any ground or underlying lease, deed of trust, mortgage or other encumbrance now or hereafter placed on the building. Tenant shall upon request by City execute any subordination agreements or other documents necessary or convenient to implement this section. In addition, Tenant shall deliver to City, at its request: (a) the financial statements of Tenant duly certified by Tenant; (b) an estoppel certificate in a form satisfactory to the City Attorney duly executed by Tenant stating that the Lease is in full force and effect, that Tenant claims no default by City thereunder and the monthly rent;and(c)Tenant's agreement to attorn to any lender.

31. GENERAL PROVISIONS.

31.1 Notices. Any notice, request, direction, demand, consent, waiver, approval or other communication required or permitted to be given hereunder shall not be effective unless it is given in writing and shall be delivered (a) in person, (b) by certified mail, postage prepaid,return receipt requested,(c)by facsimile,or(d)by a commercial overnight courier that guarantees next day delivery and provides a receipt, and addressed to the parties at the addresses stated below, or at such other address as either party may hereafter notify the other in writing as aforementioned:

If to City: City of Upland
460 North Euclid.Avenue
Upland, California 91786
Attention: Development
Services Director
Facsimile: (909)931-4321
If to Tenant: 422nd Street Bagel
220 East"A"Street
Upland, California, 91786
Attention: Laura Cayley/Isidro Gutierrez
Facsimile: N/A
Service of any such notice or other communications so made shall be deemed effective on the day of actual delivery (whether accepted or refused) as evidenced by confirmed

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answerback if by facsimile (provided that if any notice or other communication to be delivered by facsimile is unable to be transmitted because. of a problem affecting, the receiving party's facsimile machine, the deadline for receiving such notice or other communication shall be extended through the next Business Day), as shown by the addressee's return receipt if by certified mail,and as confirmed by the courier service if by courier;provided,however,that if such actual delivery occurs after 5:00 p.m. (local time where received) or on a non-Business Day, then such notice or demand so made shall be deemed effective on the first Business Day immediately following the day of actual delivery.Except as provided herein to the contrary, no communications via electronic mail shall be effective to give any notice, request, direction, demand, consent, waiver, approval or other communications hereunder.

31.2 Plats and Riders.Clauses,plats,riders and addenda,if any,affixed to this Lease are a part hereof.

31.3 Waiver. The waiver by City of any term, covenant or condition herein contained shall not be deemed to be a waiver of such term, covenant or condition or any subsequent breach of the same or any other term, covenant or condition herein contained. The acceptance of rent hereunder by City shall not be deemed to be a waiver of any default by Tenant of any term, covenant or condition herein contained, regardless of City's knowledge of such default at the time of the acceptance of such rent.

31.4 Joint Obligation. If there be more than one Tenant, the obligations hereunder imposed shall be joint and several.

31.5 Marginal Headings.The marginal headings and article titles to the articles of this Lease are not a part of the Lease and shall have no effect upon the construction or interpretation of any part hereof.

31.6 Time.Time is of the essence of this Lease and each and all of its provisions.

31.7 Prior Agreements. This Lease contains all of the agreements of the parties hereto with respect to any matter covered or mentioned in this Lease, and no prior agreements or understanding pertaining to any such matters shall be effective for any purpose.

31.8 Amendment/Execution.No provision of this Lease.may be amended or added to except by an agreement in writing signed by the parties hereto or their respective successors in interest. This Lease shall not be effective or binding on any party until fully executed by both parties hereto.

31.9 Inability to Perform, This Lease and the obligations of Tenant hereunder shall not be affected or impaired because City is unable to fulfill any of its obligations hereunder or is delayed in doing so, if such inability or delay is caused by reason of strike, labor troubles, acts of nature, or any cause beyond the reasonable control of City.

31.10 Partial Invalidity. Any provision of this.Lease which shall prove to. be invalid, void, or illegal shall in no way affect, impair or invalidate any other provision hereof and such other provision shall remain in full force and effect.

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31.11 Cumulative Remedies. No remedy or election hereunder shall be deemed exclusive but shall,whenever possible,be cumulative with all other remedies at law or in equity.

31.12 Authority of Tenant. Each individual executing this Lease on behalf o.f Tenant represents and warrants that he is duly authorized to execute and deliver this Lease on behalf of Tenant, in accordance with the bylaws of Tenant, and that this Lease is binding upon Tenant.

31.13 City's Approvals. Neither City's execution of this Lease nor any consent or approval given by City hereunder in its capacity as City shall waive, abridge, impair or otherwise affect City's powers and duties as a governmental body. Any requirements under this Lease that Tenant obtain consents or approvals of City are in addition to, and not in lieu of, any requirements of law that Tenant obtain consents or approvals.

31.14 Brokers. Tenant represents and warrants that it has not had any dealings with realtors, brokers or agents in connection with the negotiation of this Lease, and Tenant agrees to pay any realtors, brokers or agents and to indemnify, defend and hold City harmless from and against the failure to pay any realtors, brokers or agents and from any claim, cost, expense or liability for any compensation, commission or charges claimed by any other realtors, brokers or agents claiming by,through or on behalf of Tenant with respect to.this_Lease andior the negotiation hereof.

32. MEMORANDUM. City and Tenant shall, concurrently with their execution of this Lease, execute and record in the Official Records of San Bernardino County, California, a memorandum of this Lease in the form attached hereto as Exhibit C; provided, however, that City and Tenant agree to execute and record a.termination thereof upon the expiration or earlier termination of this Lease in accordance with the terms hereof. [Signatures on following page]

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•
•
IN WITNESS WHEREOF, the parties hereto have entered into this Retail Lease as of the date first above written.

CITY: CITY OF UPLAND,a California municipal corporation By:

Michael Blay,City Manager
TENANT: 42nd STREET BAGEL;a California Corporation By:

Laura Cayley,Busb2w1C ,qH
ss 4 er
By:
•
adro Gutierrez,Business Owner
•
•
•
•

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EXHIBIT A

LEGAL DESCRIPTION

SANTA FE DEPOT BUILDING
That portion of Lot 52 of Magnolia in the City of Upland,County of San Bernardino,State of California,recorded In Book 9 of Maps page 15 records of said County, described as follows:

Commencing at the centerline intersection of First Avenue and"A"Street,as shown on Parcel Map No.9890 filed in Book 109 of Parcel Maps page 86 and 87 records of said county; thence South 89°58'35"East,423.53 feet along said centerline of"A"Street;thence South 00°01'25"West,29.00 feet to the POINT OF BEGINNING;thence South 89°58'35',East,210.83 feet;
thence South 00°01'25"West,70.27 feet;
thence North 89'58'35"West,222.26 feet;
thence North 00'0.1'25"East,58.86.feet;
thence North 45°05'07"East, 16.15 feet to the POINT OF BEGINNING.

This land described herein contains approximately 15,550 square feet.

This description prepared by me:
$i) 0,2P 444Z*;
Ronald A. Musser, L.S.4230, Expires 06-30-06 4 , Date

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1 •
•

EXHIBIT B

DEPICTION OF PREMISES/SITE PLAN
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EXHIBIT C

FORM OF MEMORANDUM

RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:

City of Upland
460 North Euclid Avenue
Upland,California 91786
Attention: City Clerk
APN: 1046-583-08
[Space Above For Recorder's Use Only]
The undersigned declare that this Memorandum of Retail Lease is exempt from Recording Fees pursuant to California Government Code Section 27383 and exempt from Documentary Transfer Tax pursuant to California Revenue and Taxation Code Section 11922.

MEMORANDUM OF RETAIL LEASE
THIS MEMORANDUM OF RETAIL LEASE (this "Memorandum") is made as Of , by and between the CITY OF UPLAND, a California municipal corporation("City"), and 42nd Street Bagel, ("Tenant"), with respect to that certain Retail Lease of even date herewith(the "Lease"), pursuant to which City has agreed to lease and demise to Tenant,and Tenant has agreed to lease and accept from City, a portion of that certain real property located in the City of Upland, County of San Bernardino, State of California, commonly known as 220 East "A" Street and more particularly described on Exhibit A attached hereto(the "Property"), defined as the "Premises" in the Lease.

A copy of the Lease is on file with City and the terms and conditions of the Lease are incorporated herein by this reference. This Memorandum is prepared for the purpose of recordation only and is not a complete summary, and in no way modifies, the terms and conditions of the Lease.In the event of a conflict between this Memorandum and the Lease,the provisions of the Lease shall prevail.

IN WITNESS WHEREOF,the parties hereto have executed this Memorandum of Lease as of the date first written above.

CITY: CITY OF UPLAND,a California municipal corporation By:

Michael Blay,City Manager
TENANT: 42°d STREET BAGEL,a California Corporation By:

Laura Cayley,Bus' r
By:
idro Gutierrez,Business Owner

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EXHIBIT D

RENT SCHEDULE
Monthly Payment
Amount with 3%
Year Annual Increase 3%Annual Increase
Original Term 2025 $2,000
2026 $2,060 $60
2027 $2,121.80 $61 80
2028 $2,185,45 $63.65
2029 $2,251.02 $65.56
2030 $2,318.55 $67.53
let Option Term* 2031 $2,388,10 $69.56
2032 $2,459.75 $71.64
2033 $2,533.54 $73.79
2034 $2,609.55 _ $76.01
2035 $2,687.83 $78.29
2nd Option Term* 2036 $2,768.47 $80.63
2037 $2,851.52 $83.05
2038 $2,937.07 $85.55
2039 $3,025.18 $88.11
2040 $3,115.93 $90.76
3rd Option Term* 2041 $3,209.41 • $93.48 2042 $3,305.70 $96.28
2043 $3,404.87 $99.17
2044 $3,507.01 $1 02.15
2045 $3,612.22 $105.21 .
4th Option Term* 2046 $3,720 59 $108.37
2047 $3,832.21 $111.62
2048 $3,947.17 _ $114.97
2049 $4,065.59 $118.42
2050 _ $4,187.56 $121,97
Notes:
1) Rent due at the beginning of the month commencing 180 days after the execution of the Lease.
2) Rates for 1,250 square foot indoor space is$1,60 per square foot. 3) As provided in Section 3.2,the rent amount for they Option Terms requires an agreement between the Parties, Parties may agree to the rent provided in this schedule or another amount. Said agreement on the amount of rent must be made prior to the commencement of the Option Term.

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OF l:r
US�i5�.rVy d
�, . CALIFORNIA LEVINE ACT DISCLOSURE STATEMENT , � ,
h9ttlyl
California Government Code Section 84308, commonly referred to as the "Levine Act," prohibits City Officers from participating in any action concerning a license, permit,other entitlement for use,franchise, or contract(collectively"license, permit,or contract")if they receive political contribution(s)from a party, or its agent(s), totaling more than $500 within the twelve (12) months before the proceeding, while a proceeding is pending, and for twelve (12) months following the date of a final decision in a proceeding.

The Levine Act also requires a member of the Upland City Council who has received such a contribution to disclose the contribution on the record of the proceeding and recuse themselves before the proceeding unless the violation has been properly cured.

Current Upland City Council Members are listed at:
https://www.uplandca.gov/city-council-treasurer
Parties and their Agents are responsible for accessing the link to review the names and disclosing their applicable contributions to City Officers on the record of a proceeding.

As a party to a proceeding,you are also required to provide information below about contributions made by you, your agents on behalf of you or your organization, your organization subject to the proceeding with the City, and any organization you direct or control pursuant to the aggregation rules at FPPC Reg. § 18438.5, except for uncompensated officers of a nonprofit organization. This form is to be submitted to the City of Upland and is a public record. If you have any questions about this form, please contact your City representative for assistance.

1. Have you or your company,or any agent/board member on behalf of you or your company/entity,made any political contributions of more than $500 to any Upland City Council Member in the 12 months preceding the date of the submission of your proposal or application,or the anticipated date of any Council action?
_AYES If yes, please identify the Council Member(s):
7NO

2. Do you or your company/entity, or any agency on behalf of you or your company/entity, anticipate or plan to make any political contribution of more than $500 to any Upland City Council Member in the 12 months following any Council action related to your proposal or application? _/YES If yes, please identify the Council Member(s):

V NO
Answering yes to either of the two questions above does not preclude the Upland City Council from awarding a contract or approving an application or any subsequent action. It does, however, preclude the identified Council Member(s)from participating in any actions related to your proposal or application.

Date Signature of authorized i iv' l
L, ;er1CZ_
c�
Company/Applicant Nam
(Levine Act definitions on reverse side)

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LEVI NE ACT DISCLOSURE STATEMENT DEFI

NITIONS
Term Definition Law
A proceeding to grant, deny, revoke, restrict, or modify a license, permit or other entitlement for use, that
does not solely involve purely ministerial decisions
and is:

Covered (1)Applied for by the party;
"proceedings" (2) Formally or informally requested by the party; or FPPC Fig 1843$'2(a) (3)A contract between the agency and the party or a
franchisee granted by the agency to the party, other
than a contract that is competitively bid, a labor
contract, or a personal employment contract.

Any person who files an application for, or is the
Party subject of, a proceeding involving a license, permit, or Gov. Code 84308(f other entitlement for use.

Any person who is not a party but who actively
supports or opposes a particular decision in a
proceeding.Involving a license, permit, or other
entitlement for use and who has a financial interest in pov. Code Fi430--- ) Participant the decision.A person actively supports or opposes a FPPC Reg 18438.4 particular decision in a proceeding if that person
lobbies in person the officers or employees of the
agency, testifies in person before the agency, or
otherwise acts to influence officers of the agency.

A person who represents a party or participant for
compensation and appears before or otherwise
Agent communicates with the governmental agency for the FPPC Rem 1843 . purpose of influencing the pending proceeding. See
FPPC Reg 18438.3 for exceptions for certain
consultants.

A contract required by law to be awarded to the lowest
responsible bidder with a responsive bid, or, if the FPPC Req Competitively Bid successful bidder refuses or fails to execute the 1438 2(a)(3)(A) contract, to the next lowest bidder with a responsive
bid.

A contract or agreement reached through collective
bargaining or with a representative group regarding
Labor Contract the salary, benefits, or terms and conditions under an FPPC Reg employment or retirement policy for employees or 18438.2(a)(3)(S) retirees, including a project labor agreement entered
under Public Contract Code Section 2500.

Personal A contract for employment, including the terms and Employment conditions of employment, between the agency and FPPC Reg Contract an agency employee.A contract with an independent 18438.2(a)(3)(C)-(D) contractor is NOT a personal employment contract.

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Laura Cayley-Viva Madrid, 42nd Street Bagel, Petiscos
Isidro Gutierrez-Union on Yale and Back Abbey
225 Yale Avenue
Claremont, CA 91711
(310) 612-0229
September 4, 2024
City of Upland
460 Euclid Avenue
Upland, CA 91786
Giovanni Arellano
Melicio Picazo
Mayor Bill Velto
Mayor Pro Tem, James Breitling
Councilman Carlos Garcia
Councilwoman Shannan Maust
Councilman Rudy Zuniga
Re: Interest in renting the available space at the Santa Fe Depot Dear Giovanni, Melecio, and Members of the City Council:

Isidro and I are interested in renting the space located at the Santa Fe Depot. We bring almost 50 years of restaurant ownership , management and operation experience.

Both Isidro and I currently own and operate multiple restaurants in the area.

Isidro is a partner of both Back Abbeys (Upland and Claremont) and Union on Yale, in Claremont. He is responsible for managing all three of the restaurants.

I have owned and operated Viva Madrid for twenty-seven years, and am a partner in 42nd Street Bagel in Claremont, and own Petiscos in Claremont as well. Isidro has recently come in to help with the re-branding of Petiscos.

Isidro has been working in the restaurant industry for over twenty years. He started working in restaurants when he was thirteen and owned his first small taco shop when he was nineteen.

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In addition to our years of experience, what makes Isidro and I uniquely qualified to operate at the Depot is that we both have successfully operated restaurants in challenging locations. Viva Madrid is down a hallway with no street visibility.

Every expert I consulted prior to opening told me that the location was bad and nobody could succeed there. The Back Abbey-Claremont, is a small space and is not on the main traffic area, yet it generates one of the highest volumes per square foot in the Village as does Viva Madrid.

We would like to develop the space at the Santa Fe Depot into a 42nd Street Bagel, selling bagels made from scratch daily, cream cheese, bagel sandwiches, salads and beverages. The 42nd Street Bagel model is well suited to the Metro link location as people could purchase breakfast and coffee in the morning on their way to work as well as items to eat for lunch. We expect a brisk early morning business and late afternoon business. During the lunch hours we will be open and make a concerted effort to delver to the the local offices and hospitals . We plan on reaching out to pharmaceutical companies and provide delivery or coffee, bagels and sandwiches to the hospitals and medical offices they service.

Additionally we will utilize delivery companies as Door Dash, Uber Eats, and Chow Now.

We hope to create a space for the local community members, senior citizens, Metrolink travelers, visitors to the community and residents of the community and Coy D. Estes to meet, eat, visit and socialize.

Once we have established a solid base, it is our hope to broaden the menu and become a full service restaurant serving both take out food and full service dine- in service for breakfast and lunch. We are looking at developing the menu to be something like the one at Marston's in Pasadena which focuses on delicious breakfasts, and a variety of salads, soups and sandwiches for lunch.

If you feel that our vision would be something that you would welcome to the community and like to see at the Santa Fee depot, we would love to speak in further detail with you.

We were want to sign a long term lease with several renewal options with an initial rent of approximately $2,000.00 monthly.

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If you have any questions, please feel free to contact us. The best number is (310) 612-0229.

Thank you for your time and consideration.

R spectfullly,,
it
64"
Laura Cayl y
Isidro Guiterrez

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nlct.;N �S'tar Bagel.' ' I�rcl,�ll��l►►x ,Superb an Bagel: a bagel costumed Whole Kosher Pickle ii3A co A pepperoni pia Pickle Slice a� co
iamon Twist ' Bag of Chips
co
Bey Glaze Bagel: coated wlhoney Fresh Fit seasonal C • A E cn
cinnamon sugar Fresh Veggies w/Ranch Dressing
namon Raison Pasta Salad
!berry Garden Fresh Side Salad
nber'rY w/choice of dressing
Lipkin(Sept.-Dee.only)
!ese Onion/ Bagel Chips
tese only/Jalapeno Cheese 'Plain .Skeet • Garlic B AGELS Supporting Bagels '�' Baked fresh throughout the day in Egg Oat Bran Honey WWI al:
t Rye Poppy Seed Star Studded
u dough Garlic Everything ��
npernickel Sesame Seed Beverages
► ie Wheat Honey Onion Low Fat Milk,Chocolate Milk sole Wheat Raisin Jalapa() Low
Orange Apple
)er Onion Chocolate Chip Juices: gWhipped Cream Cheeses • Nova Lox Soft Drinks: Pepsi,Diet Pepsi,Sion<<
Buy any 12 Bagels and get one FREE Mist,Dr.Pepper,Lemonade,Iced Tea Gourmet Coffees • Sandwiches Slicing charge. (fire refills) •Sm. 'Med. •Lg. • Salads Our bagels have no preservatives. Assorted Fruit Beverages Please refrigerate or freeze them. Bottled Water korks Line of Wh4veaCreana Cheeses
— CATERING MENU — 225 N.Yale Avenue
Packed to Go Claremont
tin Lg(8oz.) BAGEL & CREAM CHEESE TRAYS
:tin ' All bagel and cream cheese trays include your In the Village mey Nut Raisin choice and quantity from any of our f-eshly 909 624-7655 die Herb made cream cheese s pecialty spreads and all al.lion our different bagels. All bagels arc sliced and mpkin(Sept:DCC.) • i served on a tray. There is a charge Co: each ►ts O'Lox tray & lid. Slice charge also.
)w Fat Plain
rw Fat vets Beny Jai To Go = 96 oz. Coffee PHONE IN YOUR ORDERS Ar Fat Vegetable Cookie Trays Sandwich Platters Arden
iipotle Fruit'frays 'lima,Chicken,Egg Salad We accept ATM cards for your convenience! ;atauc Butter nu Muffin'Days Bagel Chip Platters ava Lox 1/4 lb.

,
Breakfast_ DAILY SPECIALS Mouth Watering Melts a s t * The following served on your choice of bagel or french roll with a pickle slice. ri;l►I.I it,l Bagel Melt: Bagel with your choice of cheese(choose from Cheddar,Jack,Swiss.Provolone or Mozzarella) co
J , Served all day served melted and open face co / MONDAY Deli Bagel or Vegetarian Deli Bagel Tomato Melt: Cheese melted over tomatoes o Bagel w/Butter,margarine,honey or jam TUESDAY Reuben or Calif.Roast Beef Bagel Green Chile Melt: Cheese melted over green chiles co Bagel w/Peanut Butter Jalaperto Melt: Cheese melted over Jalapenos a) Bagel W/Plain Cream Cheese WEDNESDAY Club or Vegetarian Burger Bagel Salsa Melt: Cheese melted over salsa cm Bagel w/F lavored Cream Cheese THURSDAY Santa Fe or Egg Salad Bagel or Santa Tuna Melt: Cheese melted over tuna salad Bagel w/Lots O'Lox Cream Cheese Fe Deluxe(add.90) T rkey Melt: Cheese melted over turkey Nova Bagel: Cream Cheese&Nova Lox Ham Melt: Cheese melted over ham Cinnamon Toast Bagel FRIDAY Tuna Salad Bagel or Chicken Salad Bacon Melt: Cheese melted over bacon Homestyle Oatmeal Bagel
wButter,Raisins& Sugar Deluxe Melt: Cheese melted over turkey,bacon Muffins: Ask for varieties and tomato
Side of Bacon(3 strips) "EZER"Bagel All beef Vienna hot dog Fruit Parfait(seasonal) wrapped in bagel dough, add cheese Add bacon Add kraut Yogurt Parfait w/our own granola Pizza Bagel: Served open faced with pepperoni Fruit Cup Scene Stealing c. ...

Veggie Cup Cold SandwichesAdd to the above:

Tomatoes,Green Chiles,or Jalapenos:

Bagel ConEGCtion: Eggand cheddarOnions •Extra Meat •Extra Cheese b The following are served on your choice cheese of bagel or french ench toll with lettuce,tomato,red onion,a •Avocado S read Add ham,bacon,sausage or garden burger pickle slice,and a side order ofpotato whit!,fi esh veggies, Show-Stopping of Sandw iches* Egg whites available on request pasta salad orfreshfruil(seasonal) - • ,1 The following are served on your choice
Egg Scramble Breakfast Bowl: r�l.I of bagel or french roll with a pickle slice, Lox,Stock&Bagel: Nova Lox& and a side order of potato salad,fresh veg- Scrambled eggs mixed with cheddargies,pasta salad ot,f eslt fruit(seasonal) cheese,salsa and your choice of ham, Whipped Cream Cheese,onion&tomato bacon,sausage or vegetarian burger Tuna Salad Bagel: (Our own recipe) Hot Pastrami: Pastrami your choice of cheese Egg Salad Bagel: (Our own recipe) CA Roast Beef: Roast beef,peen chilies and jick cheese Espresso Bar& Specialty Drinks Chicken Salad Bagel:(Our own recipe) Reuben Bagel: Corned beef,swiss cheese awl sauerkraut BLT Bagel: Bacon,Lettuce&Tomato Santa Fe Bnn el: Mesquite grilled chicken breast with Espresso Club Bagel:Turkey,Bacon,Lettuce salsa,lettuce atomato Coffee/Decal/Hot Tea Commuter MugRefill Santa Fe Deluxe sam as e above w/ een and Tomato chilies&jack cheese
Chai Tea/hot or cold Vegetarian Deli Bagel: Choice of Gardenburger Bagel: Gardenburger patty,onion, Cappuccino or Lane Cheese,w/Sprouts&Avocado Spread lettuce,tomato,sprouts Mocha Deli Bagel: Build Your Own Garden Fresh Salads Illin Iced or Blended
Cappuccino or Latte Choose upto 3 of the following: ChoiceluCheese o d •Ranch •Ballssar•Oriental Vina Sesame
PP g Bhte •Ranch BalsamicVinaigcttc , Iced or Blended Mocha Roast Beef,Corned Beef or Pasta ami, Ttuicey or Ham, Low Cal Italian•Thousand Island Jack,Mo uella,Provolone,or Swiss Cheese Chef Salad: I-lien,turkey,cucumber slices,hard boiled egg,tomato wedges and grated cheddar
Americana Chinese Chicken Salad: Breast of chicken,sesame Eve Opener seeds,roasted almonds and chow mein noodles Flavored Latte/cappuccino *Nutrition Facts: Plain Bagel Serv.size:4 oz.(113g), Garden Salad: A variety of crisp green,cucumber Flavored Mocha ( slices,tomato wedges and grated cheddar cheese Amount per serving:Cabt ies 280 Fat Cal.15 Ibtal Nat 2g Tuna Salad: Homemade tuna salad,tomato wedges, Irish Creme (3%DV)Sat.Fat OG(0%DV),Ch oest.0 mg(0%DV),Sodium cucumber slices and grated cheese Extra Shot of espresso 500m(21%DV),Total curb.56g(19%DV),Fiber 2g.(8%DV), Chicken Salad: Homemade chicken salad,tomato Extra Flavoring Sugars 2g Protein 9g Vitamin A(0%DV),Vitamin C(0%DV), wedges,cucumber slices and grated cheese Hot Chocolate Calcium(2%DV),bon(20%DV) Caesar salad: Romaine lettuce with Caesar dressing, Steamer Percent Daily Values(DV)am based on 2,000 calorie diet. shredded parmesan cheese and croutons Spritzers/Italian Sodas •-- Caesar Salad iv/chicken breast

4��a �p19� CITY UP LAN D
�5, _�� "The City of Gracious Living"
CltIFOBS

1. Staff(kr°flit
DATE: March 10,2025
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:ROBERT D.DALQUEST,DEVELOPMENT SERVICES DIRECTOR

DIANE COTTO,HOUSING MANAGER
SUBJECT: CONSIDER PROPERTY MANAGEMENT SERVICES AGREEMENT WITH RPM

COMPANY FOR MANAGEMENT OF CITY-OWNED RESIDENTIAL RENTAL

PROPERTIES
RECOMMENDED ACTION:

It is recommended that the City Council approve the Property Management Services Agreement with RPM Company and authorize the City Manager to execute the Agreement and any future amendments for management of the City- owned residential rental properties;and find the Agreement is not a project under the California Environmental Quality Act(CEQA)pursuant to Section 15378 of the CEQA Guidelines.

GOAL STATEMENT
The proposed action supports the City's Housing Element goal of supporting the maintenance, rehabilitation and continued long-term preservation of the City-owned rental housing portfolio for those units that are restricted to lower- income and special needs households, as well as the goals of the U.S Department of Housing and Urban Development's Consolidated Plan of providing decent housing, and a suitable living environment for low-and moderate-income persons.

BACKGROUND
The City's affordable housing portfolio includes 259 rental units comprised of the Sunset Ridge Apartments, the Village Apartments, and Magnolia Colony Apartments. These apartment complexes play a critical role in providing housing opportunities for lower-income households. The properties were initially acquired through Redevelopment Agency funds and were subsequently transferred to the City of Upland following the dissolution of Redevelopment Agencies in California. Managing these properties effectively is essential to ensuring their long-term sustainability, maintaining compliance with federal and state regulations, and preserving affordable housing options for those low- income families and individuals in need.

To achieve these objectives, it is vital for the City to engage professional property management services. Property management companies bring the expertise needed to address the day-to-day operational demands of affordable housing, including landlord & tenant disputes, maintenance and improvements, financial oversight, and ensuring compliance with current state housing regulations.By hiring experienced property management services,the City can ensure that its affordable housing portfolio is well-maintained, meets legal requirements, and continues to serve the community's needs for the long term. Additionally,professional management can help reduce risks, improve tenant satisfaction,and maximize the value of these properties.

ISSUES AND ANALYSIS
RPM Company has successfully managed the City's housing portfolio for over 15 years and consistently meets or exceeds housing quality standards.Under RPM's management,the properties have a 96.5%occupancy rate and have generated approximately $5.2 million annually for the City's Affordable Housing Fund. This is gross revenue and funds the operating costs which include maintenance, capital projects, utilities, on-site management, income certification eligibility review,landlord-tenant issues and litigation to name a few.

RPM has proposed a flat management fee of 5.75% of the monthly income, which is significantly lower than the average property management fee in the Inland Empire, which typically ranges from 8-10%. The proposed Property Management Services Agreement will span from the remainder of Fiscal Year 2024-25 to June 30, 2030, with the option for a five-year renewal at the City's discretion.

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In accordance with the City's Purchasing Policy, property management services agreements are exempt from any formal or informal bidding process, recognizing the long-standing, successful partnership with RPM and the specialized nature of the services they provide.

ENVIRONMENTAL DETERMINATION
The Property Management Services Agreement is not a project under the California Environmental Quality Act (CEQA) pursuant to Section 15378 of the CEQA Guidelines. Under subsection (b)(5) a project is not include the organization or administrative activities of government that will not result in direct or indirect changes in the environment.

FISCAL IMPACTS
The Property Management fees are paid from the rental income derived from the City's housing portfolio;no General Fund resources are used. The $5.2 million in rental income annually will completely fund all management and operations of the City's housing portfolio.

ALTERNATIVES
Provide alternative direction to staff.

CEQA:Not a Project.

Page 71 of 168 ends

PROPERTY MANAGEMENT SERVICES AGREEMENT BETWEEN CITY OF

UPLAND AND RPM COMPANY
THIS PROPERTY MANAGEMENT AGREEMENT ("Agreement"), is made and entered into as of March 10, 2025, by and between the City of Upland, a California general law city and municipal corporation ("City"), and Ray, Douglas, Ann & Patrick, Inc., a California corporation doing business as RPM Company (the "Consultant"). City and Consultant are sometimes referred to herein individually as a"Party" and collectively as the "Parties".

RECITALS
A. WHEREAS, City is the owner of those certain real properties, consisting of buildings and other improvements commonly known as: Sunset Ridge Apartments, Village Apartments,Magnolia Colony Apartments, and Sycamore Apartments(the"Properties"), as listed in Attachment"A"to this Agreement; and
B. WHEREAS, Consultant and Upland Redevelopment Agency entered into an original Property Management Agreement dated November 23, 1998, effective January 1, 1999, to manage, operate and maintain properties, and have amended the Agreement on various occasions as the properties transferred from the Redevelopment Successor Agency to the City; and C. WHEREAS, the parties desire to update the Agreement of December 8, 2014, attached as Exhibit"A"under the same or similar terms; and NOW THEREFORE, in consideration of the mutual covenants and agreements set forth below, City and Consultant agree as follows:

1. Recitals. The recitals set forth above are true and correct and are incorporated by reference as though fully set forth herein.

2. Appointment. City hereby hires and appoints Consultant as the exclusive management services provider and leasing agent for the Properties described in Exhibit `B" (the "Project"), and Consultant hereby accepts such appointment subject to the terms and conditions set forth in this Agreement.

3. Management Plan. The Consultant agrees to provide to the City an updated comprehensive Management Plan for the Project within sixty(60)calendar days of the execution of this Agreement, which provides a detailed description of the policies and procedures to be followed in the management of the Project (the "Management Plan"). This Management Plan shall serve as a detailed Scope of Services for the Agreement. The current Management Plan is attached as Exhibit "B." Consultant represents and warrants that it has the qualifications, experience and facilities necessary to properly perform the services required under this Agreement in a thorough, competent and professional manner, and is experienced in performing the work and services required hereunder and that all materials will be both of good quality as well as fit for the purpose intended. For purposes of this Agreement, the phrase "highest 1 46708.00109\42980333.1
FINAL

Page 72 of 168 ends

professional standards" shall mean those standards recognized by one or more first-class firms performing similar work under similar circumstances. The updated Management Plan shall be approved by the City in writing prior to its use. The City and the Consultant will comply with all applicable provisions of the Management Plan regardless of whether specific reference is made thereto in any particular provision of this Agreement. The Consultant will continually review the Management Plan, for the purpose of keeping the City advised of necessary or desirable changes to either or both of these documents. This document is incorporated herein and is a part of this contract by this reference.

4. On-Site Management Office.City shall provide adequate space on the premises for a management office. City shall pay from the operation budget all expenses related to such office,including,but not limited to, furnishings, equipment,postage, office supplies, electricity, telephone, answering service, and security monitoring services, if any. The City shall retain ownership of all furnishings and equipment purchased from the operating budget.

5. Property Information. The City will provide the Consultant with immediate access to the Project,to the extent of City's rights,together with information related to the Project in the possession of the City. As soon as possible, but not more than 30 days after the commencement of the Agreement, the City will furnish the Consultant with a complete set of building plans and specifications, if available. Also, the City will provide copies of all current manufacturers' preventive maintenance schedules, guarantees and warranties pertinent to the fixtures, mechanical equipment, and appliances used in the operation of the subject property, if any. Consultant will update and safeguard all property information as necessary during the term of this Agreement.

With the aid of this property information and inspection by competent personnel,the Consultant will become thoroughly familiar with the character, location, construction, layout, plan, and operation of the Project, and especially of the electrical,heating,plumbing, air conditioning and ventilation systems, and all other mechanical equipment.

6. Marketing, Tenant Selection and Relations. Consultant shall implement any affirmative marketing plan and tenant selection criteria for the Properties supplied to it by City.

Consultant shall develop and maintain good relations with Tenants in the Properties. Consultant shall receive and respond to all Tenant complaints and shall attempt in good faith to resolve and settle such complaints subject to the parameters set forth in this Agreement. Consultant shall also coordinate the moving in and moving out of Tenants from the Properties.

7. Leasing/Rentals. The Consultant will offer for lease/rent and will lease/rent the dwelling units in the Project. The following provisions will apply:

7.1 The Consultant will be responsible for screening and selection of existing and prospective residents. The Consultant will follow the resident selection policy described in the Management Plan and will show the premises to prospective tenants.

7.2 The Consultant will prepare and verify eligibility certifications and re-certifications in accordance with the guidelines established by the City. 2 46708.00109\42980333.1
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7.3 The Consultant shall ensure that leasing/rental activities comply with any applicable federal, state, and local law.

8. Leasin2/Rental Occupancy. The Consultant will carry out all leasing/rental placement activities necessary to offer housing opportunities to all applicants in accordance with the Management Plan.

9. Security Deposits. The Consultant will collect, deposit, and disburse security deposits in accordance with the terms of each resident's Lease/Rental Agreement. The amount of each security deposit will be specified in the Management Plan, which was previously approved by the City. The collection and disbursement of security deposits will be governed by applicable state and local laws. All resident security deposits will be deposited in the general operating account for the Project, and at month end the net amount (of security deposits made less deposits returned to departing tenants) will be transferred to a bank account separate from all other accounts and funds of the Consultant and/or the City. Said account will be established at an agreed upon bank. This account will be carried in the Consultant's name of the Project and designated on record as City's "Security Deposit Account" and in addition, the Development Services Director and the City Treasurer shall be included as signers of this account. The balance of the security deposit account can be used to pay general operating expenses,however, security deposits received must be documented and accounted for at all times. The Consultant must comply with any applicable state and local laws concerning interest payments on security deposits, security deposit amounts required of tenants, and return of security deposits to tenants upon termination of tenancy.

10. Collection of Rents and Other Receipts. The Consultant will collect when due all the rents, charges and other amounts receivable on the City's account in connection with the management and operation of the Properties. Such receipts (except for resident's security deposits,which will be handled as specified in Section 9 above)will be deposited in an account, separate from all other accounts and funds, at an agreed upon bank. This account will be carried in the name of the Project and designated on record as City's "General Operation Account" and in addition, the Development Services Director and the Finance Manager shall be included signers of this account.

11. Enforcement of Lease/Rental Agreements. The Consultant will ensure full compliance by each resident with the terms of the Rental Agreement. The Consultant will make referrals to community agencies in cases of financial hardship or under other circumstances deemed appropriate by the Consultant.Involuntary termination of tenancies should be consistent with the pertinent procedures prescribed in the Management Plan, and shall be consistent with federal, state and local law. The Consultant may lawfully terminate any tenancy when, in the Consultant's judgment and consistent with existing law, sufficient cause (including, but not limited to, nonpayment of rent) for such termination occurs under the terms of the resident's Lease/Rental Agreement. For this purpose, the Consultant is authorized to consult with legal counsel to bring actions for unlawful detainer, and to execute notices to vacate and judicial pleadings incident to such actions; provided, however, that the Consultant obtains written approval of the selected legal counsel by City prior to use, keeps the City informed of such 3 46708.00109\42980333.1
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actions, and follows such instructions as the City may prescribe for the conduct of any such action. Attorneys' fees and other necessary costs incurred in connection with such actions will be paid out of the General Operating Account as property expenses.

12. Maintenance and Repairs. The Consultant will maintain the property in good repair in accordance with the Management Plan, local building and health codes, and in a condition at all times acceptable to the City. This will include, but not be limited to, cleaning, painting, decorating, plumbing, carpentry, grounds care, and such other maintenance and repair works as may be necessary, subject to any limitations imposed by the City in addition to those contained herein. Consultant is responsible for collaboration and oversight of major capital expenditures or rehabilitation activities for the project carried out and supervised by City, and Consultant agrees to cooperate as necessary in such activities. On occasion if Consultant agrees to be responsible for a major capital expenditure, rehabilitation activity, or maintenance activity, the Consultant will be compensated, on an agreed upon amount for their efforts.

12.1 The Consultant, in coordination with the City to ensure that procurement complies with state and local law, will complete preventative maintenance activities in the most cost effective and efficient manner as possible.

12.2 The Consultant, in coordination with the City to ensure that procurement complies with state and local law,will contract with qualified independent contractors for the maintenance and repair of roofs, air-conditioning and heating systems and for extraordinary repairs beyond the capability of regular maintenance employees.

12.3 The Consultant will systematically receive and investigate all service requests from residents, take such action thereon as may be justified and will keep records of the same.

Emergency requests will be received and serviced on a twenty-four(24) hour basis. Serious complaints will be reported to the City after investigation.

12.4 The Consultant, in coordination with the City to ensure that procurement complies with state and local law, is authorized to purchase all materials, equipment, tools, appliances, supplies,and services necessary for proper maintenance and repair of the projects. The City shall retain ownership of all said materials, equipment, tools, appliances and supplies.

12.5 Notwithstanding any of the forgoing provisions, the prior approval of the City shall be required for any expenditure which exceeds Five Thousand Dollars ($5,000.00) in any one instance for labor, materials, and/or otherwise in connection with the maintenance and repair of the properties. This limitation is not applicable for recurring expenses within the limits of the operating budget or emergency repairs involving manifest danger to person or property. In the latter event, the Consultant will inform the City of the facts as promptly as possible to coordinate an effective response.

13. Utilities and Services.In accordance with the Management Plan,the Consultant will make arrangement for water, electricity, gas, sewage and trash disposal, vermin extermination, laundry facilities, and telephone and cable services. Subject to the City's prior approval, the Consultant shall make such contracts as may be necessary to secure such utilities and services on behalf of the City.
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14. Employees. The Management Plan prescribes the number, qualifications and duties of the personnel to be regularly employed in the direct management of the Properties. All such personnel will be employees of the Contractor and will be hired, paid, supervised, and discharged through the Contractor. The Contractor ensures that their employment policies include a statement to provide a drug-free workplace or similar substance abuse policy.

Additionally, all employees of Contractor must meet all qualifications and licensing requirements applicable to completing the assigned tasks. It is understood that all direct costs associated with employees working "on-site" will be borne by the City to include their salary and benefits, to include Social Security taxes, employee taxes, medical insurance and Worker's Compensation and Housing allowance (if applicable). Such reimbursement will be paid out of the General Operating Account and will be treated as a project expense.

15. Disbursement from General Operating Account. From the funds collected and deposited by the Consultant in the General Operating Account pursuant to Section 10 above, the Consultant will make the following disbursements promptly when payable:
(a) Reimbursements to the Consultant for compensation payable to the employees specified in Section 14 above, and for the taxes and assessments payable to local, state and federal governments in connection with the employment of such personnel;
(b)All sums otherwise due and payable by the City as expenses of the property authorized to be incurred by the Contractor under the terms of this Agreement, including compensation payable to the Contractor, for its service hereunder; and (c) Payments to the Trustee for the beneficiaries of the City's source of real estate financing (i.e. the holder of City's tax exempt bonds). Such payments are set forth within the Official Statement and Indenture of Trust with respect to City's tax- exempt bond issue.

15.1 Except for disbursements mentioned in Section 15 above and transfers to the Security Deposit Account as set forth in Section 9 above, funds will be disbursed or transferred from the General Operation Account only as the City may from time to time direct in writing.

15.2 In the event the balance in the General Operation Account is insufficient to pay disbursements due and payable under Section 13 above, the Contractor will inform the City of that fact and the City will then remit to the Contractor sufficient funds to cover the delinquency.

In no event will the Contractor be required to use its own funds to pay such disbursements, and any other disbursements concerning the operation of the properties.

16. Budgets. Annual operating budgets for the Properties will be submitted by the Consultant and approved by the City. Except as permitted under Section 15 above, annual 5 46708.00109\42980333.1
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disbursements for each type of operation expenses itemized in the budget will not exceed the amount authorized by the approved budget. The Consultant will prepare a recommended operating budget for each fiscal year during the term of this Agreement, to be submitted by February 1st of each year for the following fiscal year. The City will promptly inform the Consultant of any changes incorporated in the approved budget, and the Consultant will keep the City informed of any anticipated deviation from the receipts or disbursements stated in the approved budget.

17. Records and Reports. In addition to any requirements specified in the Management Plan or other provisions of this Agreement,the Consultant will have the following responsibilities with respect to accounts and reports:
(a) The Consultant will establish and maintain, on a modified accrual basis, a comprehensive system of records, books and accounts in a manner satisfactory to the City. All records,books and accounts will be subject to examination at reasonable hours by any authorized representative of the City. (b) With respect to each fiscal year ending during the term of this Agreement, including the separate reporting period of July 1 through June 30, the Consultant will be subject to an annual audit conducted by a firm of the City's choice. The Consultant agrees to make available all applicable records to the City's auditors for annual review. The report will be prepared in accordance with generally accepted accounting practices and submitted to the City within sixty(60) days after the end of the fiscal year. The report submitted by the City's auditors will also be subject to the City's single audit at the City's discretion. The preparer's services will be paid for out of the General Operating Account as an expense of the property.
(c) The Consultant will furnish, within a reasonable period of time, information as may be requested by the City from time to time with respect to the financial, physical or operational condition of the Properties.
(d) By the fifteenth(15th) day of each month, the Consultant will furnish the City with an itemized list of all delinquent accounts, as of the tenth (10th) day of the current month.
(e) By the fifteenth(15th) day of each month, the Consultant will furnish the City with a statement of receipts and disbursements for the previous month, a schedule of accounts receivable and payable and reconciled bank statements for all accounts maintained by the Consultant on behalf of the City, reflecting disbursements and deposit amounts as of the twenty-fifth of the previous month.

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records will also be provided as part of the financial reports. Prior to commencement, City will furnish Consultant with available information to establish general ledger accounts on all items (such as depreciation) that City wants reflected on the balance sheet.

18. Fidelity Bond. The Consultant will place the Properties on a master Fidelity Bond, which provides blanket coverage equal to two (2) months gross rent potential. The bond will provide coverage for all principals and agents of the Consultant and all people who participate directly or indirectly in the management of the Properties and its assets, accounts and records. The premiums for such a bond will be paid from the Consultant's management fee.

Specifically, coverage for the Consultant, including all applicable people in the Consultant's Central Office, will be paid from the management fees. Said Fidelity Bond shall be issued by a company acceptable to the City.

19. Bids, Discounts, Rebates or Commissions. The City and Consultant agree to obtain contract materials, supplies and services at the lowest possible cost and on the most advantageous terms to the Properties and to secure and credit to the Properties discounts,rebates and commissions obtainable with respect to purchases, service contracts and all other transactions on behalf of the Properties. The City and Consultant agree that all goods and services purchased from individuals or companies having a conflict-of-interest with the City or Consultant shall be purchased at costs not in excess of those that would be incurred in making arms-length purchases on the open market. All vendor accounts shall be opened in the name of the project.

The Consultant shall solicit competitive written cost quotes (i.e. bids) from at least three contractors or suppliers for any purchase or work item that the Consultant estimates will cost $5,000 or more for any purchase of on-going supply or service arrangement or capital projects which is estimated to exceed $25,000 per year. The Consultant agrees to accept the bid which represents the lowest price, taking into consideration the bidder's reputation for quality of workmanship or materials and timely performance,and the time frame within which the services or goods are needed. The Consultant must make every reasonable effort to assure that the City is obtaining services, supplies and purchases at the lowest possible cost. The Consultant must make and retain a written record of any verbal estimates obtained. Copies of all required bids and documentation of all other written or verbal cost comparisons made by the Consultant shall be made part of the property's records and shall be retained for three (3)years from the date the work was completed. The City shall pre-approve disbursements of over $5,000 and on-going supply or service arrangement or capital projects in excess of$25,000. This documentation shall be subject to inspection by the City or its designee and the Consultant agrees to submit documentation upon request.

20. Resident Services Program. The Consultant will be responsible to the City for carrying out any social services program described in the Management Plan.

21. Compliance with Government Orders.The Consultant will take such action as it may be necessary to comply promptly with any and all governmental orders or other 7 46708.00109\42980333.1
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requirements affecting the Properties, whether imposed by federal, state, county, or municipal authority, subject, however, to the limitations stated in Section 12 with respect to repairs.

Nevertheless, the Consultant shall take no such action so long as the City is contesting, or has affirmed its intention to contest, any such order or requirement. The Consultant will notify the City in writing of all notices such as orders or other requirements as soon as possible from the time of the receipt. The City will notify Consultant, in writing, of all such notices received.

22. Consultant's Compensation. The Consultant will receive compensation for services provided under this Agreement through monthly fees,paid from the General Operating Account and classified as property expenses. The Consultant's fee will be calculated based on Total Property Income. These fees will be due on the first day of each month, covering the services rendered in the previous month, throughout the duration of this Agreement..

22.1 The Consultant shall be paid a monthly fee of 5.75%.

Notwithstanding the above, at the end of fiscal year, City may assess the Consultant's performance to determine whether additional compensation is warranted, based on the Consultant's effectiveness in maximizing the net project revenues from the Apartments.

22.2 Consultant's employees who work off-site or in the Consultant's office will be paid directly by the Consultant out of the management fee.

22.3 Except as otherwise provided in this Agreement, all off-site bookkeeping, clerical and other management overhead expenses (including but not limited to, costs of office supplies and equipment,postage, transportation for managerial personnel and telephone services) will be borne by the Consultant out if its own funds and will not be treated as property expenses, except for the postage and overnight express courier expenses from Consultant's principal executive office with respect to the transmittal of vendor payments.

23. Term. The term of this Agreement shall commence on January 1, 2025. The term shall expire five (5)years following the Commencement Date,unless earlier terminated pursuant to Section 23 of this Agreement(the "Term") subject, however, to the following conditions:
(a)At the lapse of the initial term, the City may, in its sole discretion, offer an additional five-year extension of this Agreement subject to the same or similar terms and conditions as are herein contained. At the end of the five-year period, the City may elect to offer Consultant a new agreement on the same or similar terms as presented in this Agreement.
(b) This Agreement may be terminated by the mutual consent of the Principal Parties as of the end of any calendar month, provided that at least ninety(90) days advance written notice thereof is given to consenting party. This Agreement may also be terminated by the City for unsatisfactory performance by the Consultant during the first 90 days of this Agreement. This Agreement may also be terminated for cause by either party, after sufficient time to cure is rendered, 8 46708.00109\42980333.1
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provided that at least ninety(90) days advance written notice thereof is given to the other.
(c) In the event that a petition in bankruptcy is filed by or against either of the Principal Parties, or in the event that either makes an assignment for the benefit of creditors to take advantage of any insolvency act, the other party may terminate the agreement as provided for in "b" above.
(d)Upon termination, the Consultant will submit to the City any financial statements required. All Property's cash trust accounts, investments, equipment and records will be turned over to the City within thirty(30) days of the date the Consultant is terminated.

24. City's Indemnification.Notwithstanding any provision of this Agreement or any obligation of Consultant hereunder, it is understood and agreed:
(a) That the City has assumed and will maintain its responsibility and obligation through the term of this agreement for the finances and the financial stability of the Properties; and
(b) That the Consultant shall have no obligation, responsibility or liability to fund authorized property costs, expenses, or accounts other than from those funds generated by the property itself or provide to the Properties or to the Consultant by the City.

In accordance with the foregoing, the City agrees that the Consultant shall have the right at all times to secure payment of its compensation, as provided for under Section 22 of this Agreement, from the General Operating Account, immediately when such compensation is due and without regard to other property obligations or expenses conditioned on the Consultant having satisfactorily discharged all duties and responsibilities under this Agreement. Moreover,the City hereby indemnifies the Consultant and agrees to hold it harmless with respect to Property costs, expenses, accounts, liabilities and obligations during the term of the Agreement and further agrees to guarantee to the Consultant the payment of its compensation during the term of this Agreement to the extent that the Property's Operating and Maintenance Account is insufficiently funded for this purpose. Failure of the City at any time to abide by and to fulfill the forgoing shall be breach of this Agreement entitling the Consultant to obtain from the City, upon demand, full payment of all compensation owed to the Consultant through the date of such breach.

25. Release of News Information. No news release, including photographs, public announcements or confirmation of same, or any part of the subject matter of this Agreement or any phase of any program hereunder shall be made without prior written approval of City's Development Services Director or his or her designee.

26. Confidentiality of Reports. Consultant shall keep confidential all reports, information and data received, prepared or assembled pursuant to performance hereunder and 9 46708.00109\42980333.1
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that City designates as confidential. Such information shall not be made available to any person, firm, corporation or entity without the prior written consent of City.

27. City Support. City shall provide Consultant with any plans, publications, reports, statistics, records or other data or information pertinent to the services to be provided hereunder which are reasonably available to City.

28. Independent Contractor. Neither the City nor any of its employees shall have any control over the manner, mode or means by which Consultant, its agents or employees, perform the services required herein, except as otherwise set forth herein. City shall have no voice in the selection, discharge, supervision or control of Consultant's employees, servants, representatives, or agents, or in fixing their number, compensation or hours of service.

Consultant shall perform all services required herein as an independent contractor of City and shall remain at all times as to City a wholly independent contractor with only such obligations as are consistent with that role. Consultant shall not at any time or in any manner represent that it or any of its agents or employees are agents or employees of the City. City shall not in any way or for any purpose become or be deemed to be a partner of Consultant in its business or otherwise or a joint venture or a member of any joint enterprise with Consultant.

29. Conflict of Interest. Consultant represents, warrants and agrees that it does not presently have, nor will it acquire during the term of this Agreement, any interest direct or indirect, by contract, employment or otherwise, or as a partner, joint venture or shareholder (other than as a shareholder holding one percent [1%] or less interest in publicly traded companies) or affiliate with any business or business entity from which it purchases any goods or services pursuant to this Agreement or that has entered into any contract, subcontract or arrangement with City. Upon execution of this Agreement and during the term, as appropriate, Consultant shall upon written request, disclose in writing to City any vendor from which it purchases goods or services pursuant to this Agreement or other contractual or employment arrangement form which it receives compensation. Consultant agrees not to accept any employment during term of this Agreement by any other person, business or corporation which employment will or may likely develop a conflict of interest between the City of Upland's interests and the interests of third parties.

30. Prohibition Against Subcontracting or Assignment. The experience, knowledge, capability and reputation of Consultant, its principals and employees were a substantial inducement for the City to enter into this Agreement. Therefore, Consultant shall not contract with any other entity to perform in whole or in part the services required hereunder without the express written approval of the City. In addition, neither this Agreement nor any interest herein may be transferred, assigned, conveyed, or encumbered voluntarily or by operation of law, whether for the benefit of creditors or otherwise, without the prior written approval of the City.

Transfers restricted hereunder shall include the transfer to any person or group of people acting in concert of more than twenty-five percent (25%) of the present ownership and/or control of the Consultant, taking all transfers into account on a cumulative basis. In the event of such an unapproved transfer, including any bankruptcy proceeding, this Agreement shall be void. No approved transfer shall release the Consultant or any surety of Consultant of any liability hereunder without the express consent of the City.
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31. Status of Consultant. Consultant shall have no authority to bind City in any manner, or to incur any obligation, debt or liability of any kind on behalf of or against City, whether by contract or otherwise, unless such authority is expressly conferred under this Agreement or is otherwise expressly conferred in writing by City. Consultant shall not at any time or in any manner represent that Consultant or any of Consultant's officers, employees, or agents are in any manner officials, officers, employees or agents of City. Neither Consultant, nor any of Consultant's officers, employees or agents, shall obtain any rights to retirement, health care or any other benefits which may otherwise accrue to City's employees. Consultant expressly waives any claim Consultant may have to any such rights.

32. Indemnification. Consultant agrees to indemnify, defend(upon request of City) and save harmless City, its elected and appointed officials, officers, agents and employees from and against any liability,expense,including defense costs and legal fees,and claims for damages of any nature whatsoever, including, but not limited to, bodily injury, death, personal injury or property damage arising from or connected with Consultant's operations, or its services, acts and/or omissions hereunder, including any worker's compensation suit, liability or expense, arising from or connected with services performed by or on behalf of Consultant by any person to this Agreement.

33. Insurance. Without limiting Consultant's indemnification of City, Consultant shall procure and maintain at all times during the life of this Agreement, a program of insurance against claims for injuries to person, death, or damages to property which may arise from or in connection with performance of the work hereunder by Consultant, its officers, representatives, agents, or employees. Consultant acknowledges that Section 1860 and 3700 of the California Labor Code requires all employers to be insured against liability for worker's compensation or undertaking self-insurance in accordance with the provisions of that Code Section. Consultant shall formally acknowledge this requirement by signing the attached certificate Attachment"B" prior to commencing work hereunder. Further,prior to commencement of work pursuant to this Agreement, Consultant, shall obtain all insurance required hereunder from a company or companies acceptable to City's Risk Manager. For the purposes of the Insurance Section of this Agreement, City's Risk Manager shall mean City's Human Resources Manager. Said program of insurance shall be maintained by Consultant in the form and subject to the conditions set forth in Attachment "C" hereto.

Failure on the part of Consultant to procure or maintain required insurance shall constitute a material breach of this Agreement upon which City may immediately terminate this Agreement.

34. Non-Discrimination. In the fulfillment of the program established under this Agreement, either as to employment, upgrading, demotion, transfer, recruitment or recruitment adverting, layoff, or termination, rates of pay or other terms of compensation, selection for training,including apprenticeship or participation in the program or the receiving of any benefits under the program, Consultant agrees not to discriminate nor to allow any subcontractor to discriminate on the basis of race, color, creed,religion,natural origin, ancestry, sex, age,marital status, or physical disability.
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35. Compliance with Laws. The parties agree to be bound by applicable federal, state and local laws, regulations and directives as they pertain to the performance of this Agreement.

36. Severability. In the event that any provision herein contained is held to be invalid, void or illegal by any court of competent jurisdiction, the same shall be deemed severable from the remainder of this Agreement and shall in no way affect, impair, or invalidate any other provision contained herein. If any such provision shall be deemed invalid due to its scope or breadth, such provision shall be deemed valid to the extent of the scope or breadth permitted by law.

37. Interpretation.No provision of this Agreement is to be interpreted for or against either party because that party or that party's legal representative drafted such provision,but this Agreement is to be construed as if it were drafted by both parties hereto.

38. Disputes — Attorney's Fees. If either party to this Agreement is required to initiate or defend litigation in any way connected with this Agreement, the prevailing party in such litigation, in addition to any other relief which may be granted, whether legal or equitable, shall be entitled to reasonable attorney's fees.

39. Waiver. No breach of any provision hereof can be waived unless in writing.

Waiver of any one breach of any provision shall not be deemed to be a waiver of any other breach of the same or any other provision hereof.

40. Notices. Any and all notices or other communications given under this Agreement shall be deemed to have been properly given when delivered,if personally delivered, or three(3)days after the date mailed if sent certified or registered mail,return receipt requested and postage prepaid, and addressed to the Parties at the following addresses.

To Consultant: RPM Company
1420 S. Mills, Suite M
Lodi, CA 95242
To City: City of Upland
460 N. Euclid Avenue
Upland, CA 91786
Attn: Robert Dalquest, Director of Development Services Any notices delivered by either Party in any manner other than those described above shall be deemed properly given when received. Either Party may change its address for the giving of notices under this Agreement by delivering to the other Party ten(10) days'prior written notice of such change of address.
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41. Emergency Notices. Either Party may give the other notice of emergency situations orally (personally, by telephone or otherwise) or by telecopy, telex, telegram or other method, provided that the Party giving any emergency notice as provided above in this Section 39 shall confirm the same by written notice in accordance with Section 39 above.

42. Complete Agreement. This Agreement, including any specified attachments, constitutes the entire agreement between City and Contractor with respect to the management and operation of the Properties and supersedes and replaces any and all previous management agreements entered into or/and negotiated between City and Consultant relating to the Properties covered by this Agreement. No change to this Agreement shall be valid unless made by supplemental written agreement executed and approved by City and Consultant. Except as otherwise provided herein, any and all amendments, additions, or deletions to this Agreement shall be null and void unless approved by City and Consultant in writing. Each party to this Agreement hereby acknowledges and agrees that the other party has made no warranties, representations, covenants. or agreements, express or implied, to such party, other than those expressly set forth herein, and that each party, in entering into and executing this Agreement, has relied upon no warranties, representations, covenants, or agreements, express or implied, to such party, other than those expressly set forth herein.

43. Applicable Law and Partial Invalidity. The execution, interpretation, and performance of this Agreement shall in all respects be controlled and governed by the laws of the State of California. If any part of this Agreement shall be declared invalid or unenforceable, either Party shall have the option to terminate this Agreement by notice to the other Party.

44. Agreement Binding on Successors and Assigns. This Agreement shall be binding upon the Parties hereto and their respective personal representatives, heirs, administrators, executors, successors and assigns.

45. Counterparts; Facsimile Signatures. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.Facsimile and electronically transmitted signatures shall be considered original signatures.
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IN WITNESS WHEREOF, the Parties hereto have caused this instrument to be duly executed by their duly authorized officers as of the day and year first above written,

SIGNATURES
TO

PROPERTY MANAGEMENT SERVICES AGREEMENT
CITY OF UPLAND RPM Company
[If Corporation, TWO signatures, President OR
Vice President AND Secretary OR Treasurer]
By: By:

Michael Blay
City Manager
Its: President/Chief Executive Officer
Printed Name:Donnie Garibaldi
Attested by:

By: By:

Keri Johnson
City Clerk
Its: Human Resources & Portfolio Manager
Printed Name:Julie Wood
Approved as to form:

By:

Best Best& Krieger LLP
City Attorney
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ATTACHMENT "A"

ADDRESSES AND ASSESSOR'S PARCEL NUMBERS
I. Sunset Ridge Apartments (formerly Americana Apartments) Addresses: 531, 539, 579, 581, 597, 611, 619, 659 and 663 East Thirteenth Street, Upland, CA
APN: 1045-392-43
II. Village Apartments (formerly Armstrong Apartments) Addresses: 129, 130, 137, 138, 147, 148, 151, 152, 163, 164, 167, 168, 179, 180, 183, 184, 195 & 196 Armstrong Way, Upland, CA
APNs: 1007-571-35 through 52
III. Magnolia Colony Apartments
Addresses: 431, 485, 503, 557, 571, 615, 625, 650, 653, 660, 663 and 689 Diamond Court, Upland, CA
230, 233 and 275 Vallejo Way, Upland, CA
288 San Antonio Avenue, 649, 659, and 717 West 9th Street APNs: 1046-351-07, 08, 09, 11, 12, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 28, 31, 33, 39
IV. Sycamore Apartments
Addresses: 906 Sycamore Court
APN: 1047-192-12
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ATTACHMENT "B"

WORKERS COMPENSATION LAW COMPLIANCE CERTIFICATE
This shall certify that the Managing Agent is aware of the provisions of Section 3700 of the California Labor Code which requires every employer to be insured against liability for workers compensation or undertake self insurance in accordance with the provision of that Code Section, and will comply with such provisions before commencing the performance of work under the Agreement for Property Management Services with the Successor Agency of the City of Upland.

MANAGING AGENT
By:

Its:

Date:
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ATTACHMENT "C"

INSURANCE REQUIREMENTS
Consultant agrees to provide insurance according to the requirements set forth here.

Consultant will maintain the following coverage on behalf of City,its official,employees and agents.

Commercial General Liability Insurance Insurance Services Office Form CG 00 01 covering CGL on an "occurrence" basis, including products and completed operations, property damage, bodily injury and personal & advertising injury shall be provided.

Policy limits shall be no less than three million dollars per occurrence for all coverages and general aggregate. General liability insurance will not be limited to coverage for the vicarious liability or the supervisory role of the additional insureds. Coverage for the additional insureds shall apply to the fullest extent permitted by law. The City of Upland, its elected and appointed officials, officers, employees and agents shall be added as additional insureds using Insurance Services Office additional insured endorsement form CG 20 10 11 85 on the Consultants general liability policy.

Business Auto Coverage shall be written on Insurance Services Office Business Auto Office Form Number CA 0001 covering, Code 1 (any auto), or if Consultant has no owned autos, Code 8 (hired) and 9 (non-owned), with limit no less than $1,000,000 per accident for bodily injury and property damage. Limits shall be no less than one million dollars per accident. This policy shall be scheduled as underlying insurance to any umbrella policy as applicable. If Consultant owns no autos, a non-owner auto endorsement to the General Liability policy described above is acceptable.

Workers' Compensation/Employer's Liability shall be written on a policy form providing workers' compensation statutory benefits as required by law. Employer's liability limits shall be no less than one million dollars per accident or disease. Unless otherwise agreed, this policy shall be endorsed to waive any right of subrogation as respects Owner, the City of Upland, its elected and appointed officials, officers, employees and agents.

General conditions pertaining to provision of insurance coverage by Consultant.

Consultant and City agree to the following provisions regarding insurance provided by Consultant.

1. Consultant agrees to provide insurance in accordance with the requirements set forth here. If Consultant uses existing coverage to comply with these requirements and that coverage does not meet the requirements set forth herein, Consultant agrees to amend, supplement or endorse the existing coverage to do so. In the event any policy of insurance required under this Agreement does not comply with these requirements or is canceled and not replaced,City has the right but not duty to obtain the insurance it deems necessary and any premium paid by City will be promptly reimbursed by Consultant. In the alternative, City may immediately terminate this Agreement. 18 46708.00109\42980333.1
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2. The coverage required here will be renewed annually by Consultant as long as Consultant continues to provide any services under this or any other contract or agreement with the City. Consultant agrees to maintain this coverage after the term of this Agreement so long as such coverage is reasonably available.

3. No liability insurance coverage provided to comply with this Agreement shall prohibit Consultant, or Consultant's employees, or agents, from waiving the right of subrogation prior to a loss. Consultant waives its right of subrogation against City.

4. The provisions of any workers' compensation or similar act will not limit the obligations of Consultant under this agreement. Consultant expressly agrees not to use any statutory immunity defenses under such laws with respect to City, it's elected and appointed officials, officers, employees, and agents.

5. All insurance coverage and limits provided by Consultant and available or applicable to this agreement are intended to apply to the full extent of the policies.

Nothing contained in this Agreement or any other agreement relating to the City or its operations limits the application of such insurance coverage.

6. Unless otherwise approved by City, the insurance provided pursuant to these requirements shall be written by insurers authorized to do business in the State of California and with a minimum "Best's" Insurance Guide rating of A:VII. Self- insurance will not be considered to comply with these insurance specifications.

7. Any "self-insured retention" must be declared and approved by City. City reserves the right to require the self-insured retention to be eliminated or replace by a deductible. Self-funding, policy fronting or other mechanisms to avoid risk transfer are not acceptable. If Consultant has such a program, Consultant must fully disclose such program to City.

8. Consultant shall provide proof that policies of insurance required herein expiring during the term of this Agreement has been renewed or replaced with other policies providing at least the same coverage. Proof that such coverage has been ordered shall be submitted prior to expiration. A coverage binder or letter from Consultant's insurance agent to this effect is acceptable. A certificate of insurance and/or additional insured endorsement as required in these specifications applicable to the renewing or new coverage must be provided to City within five days of the expiration of the coverages.

9. Consultant agrees to provide evidence of the insurance required herein, satisfactory to City consisting of: a) certificate(s) of insurance evidencing all of the coverages required and, b) an additional insured endorsement to Consultant's general liability policy using as one of the following ISO ongoing operations Forms: CG 20 10 or CG 20 26 or CG 20 33 (not allowed from subcontractors), or CG 20 38; and one of the following ISO completed operations Forms: CG 20 37, CG 20 39 (not allowed from subcontractors), or CG 20 40. Consultant agrees, upon request by City to provide complete, certified copies of any policies required by this section,within 10 days of such request.

10. Certificates(s) are to reflect that the insurer will provide 30 days notice to Owner of any cancellation of coverage.Managing Agent agrees to require its insurer to modify such certificates to delete any exculpatory wording stating that failure of the insurer to mail written notice of cancellation imposes no obligation, or that any party will 19 46708.00109\42980333.1
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"endeavor" (as opposed to being required) to comply with the requirements of the certificate.

11. Managing Agent agrees to require all subcontractors or other parties hired for this project to provide the same insurance as required of Managing Agent unless otherwise agreed to by Owner. The subcontractor's general liability insurance shall add as additional insureds all parties to this Agreement using Insurance Services Office form CG 20 10 11 85. Managing Agent agrees to obtain certificates evidencing such coverage and make reasonable efforts to ensure that such coverage is provided as required here.

12. Managing Agent agrees that upon request, all agreements with subcontractors or others with whom Managing Agent enters into contracts with on behalf of Owner, will be submitted to Owner for review. Failure of Owner to request copies of such agreements will not impose any liability on Owner, or its employees.

13. Requirements of specific coverage features or limits contained in this Section are not intended as a limitation on coverage, limits or other requirements, or a waiver of any coverage normally provided by any insurance. Specific reference to a given coverage feature is for purposes of clarification only as it pertains to a given issue and is not intended by any party or insured to be all inclusive, or to the exclusion of other coverage, or a waiver of any type.

14. Managing Agent agrees to provide immediate notice to Owner of any claim or loss against Managing Agent arising out of the work performed under this Agreement.

Owner assumes no obligation or liability by such notice, but has the right (but not the duty) to monitor the handling of any such claim or claims if they are likely to involve Owner.

15. The insurance requirements set forth in this Section are intended to be separate and distinct from any other provision in this Agreement and are intended to be interpreted as such.

16. The requirement in this Section supersedes all other sections and provisions of this Agreement to the extent that any other section or provision conflicts with or impairs the provision of this Section.

17. For the purpose of insurance coverage only,This Agreement will be deemed to have been executed immediately upon any party hereto taking any steps that can be deemed to be in furtherance of or towards performance of this Agreement. 20 46708.00109\42980333.1
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EXHIBIT "A"

PROPERTY MANAGEMENT SERVICES AGREEMENT BY AND BETWEEN CITY OF UPLAND AND RPM COMPANY,DECEMBER 8, 2014
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EXHIBIT "B"

CURRENT MANAGEMENT PLAN
Property Management Plan for [Company Name]
Overview: This Property Management Plan outlines the strategies and processes for the effective management of 296 residential units. The plan focuses on property maintenance, tenant relations, leasing, and financial management, ensuring efficient and cost-effective operations while enhancing tenant satisfaction and property value.

1. Property Maintenance & Repairs
Objective:

To ensure the properties are maintained to a high standard, minimizing downtime and ensuring tenant satisfaction.

Key Areas of Focus:
• Inspections:

Inspections will be completed periodically in compliance with all applicable laws, including but not limited to those related to preventative maintenance, service request, emergency and good cause.
• Preventative Maintenance:

Develop a schedule for regular maintenance tasks (e.g., cleaning HVAC filters, inspecting fire alarms, servicing plumbing) to prevent costly repairs. • Emergency Repairs:
24/7 emergency repair hotline for tenants to report urgent issues (e.g., plumbing leaks, power outages).
• Vendor Management:

Establish relationships with trusted, licensed contractors for regular maintenance and emergency repairs. Maintain a list of preferred vendors for specific needs (e.g., electricians,plumbers, landscapers).
• Tenant Communication:

Notify tenants in advance of scheduled maintenance and repairs to minimize disruption.

Action Steps:
• Create a preventive maintenance schedule for key systems. • Implement an online portal for tenants to request non-emergency repairs. • Keep detailed records of all repairs and inspections. 22 46708.00109\42980333.1
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2. Tenant Relations & Communication
Objective:

To foster positive relationships with tenants, ensuring high occupancy rates and low turnover.

Key Areas of Focus:
• Tenant Screening:

Comprehensive tenant screening process, including background checks, credit checks, and rental history verification.
• Move-In/Move-Out Procedures:

Clear guidelines for move-in and move-out processes, including property walkthroughs, deposit handling, and documentation of unit condition.
• Tenant Support:

Provide responsive customer service via phone, email, and an online portal for maintenance requests and inquiries.
• Community Engagement:

Organize occasional tenant events to build a sense of community and improve retention. • Conflict Resolution:

Develop a protocol for addressing tenant complaints or conflicts, emphasizing prompt resolution and fairness.

Action Steps:
• Use of a comprehensive lease agreement and its addendums will outline all policies, procedures, and expectations for both parties, ensuring clear understanding and compliance with the terms of the lease.
• Set up an online tenant portal for easy communication and requests. • Regularly survey tenants to gauge satisfaction and address concerns.

3. Leasing & Marketing
Objective:

To ensure maximum occupancy and revenue through effective leasing strategies and marketing efforts.

Key Areas of Focus:
• Market Research:

Regularly assess local rental market trends to ensure competitive pricing. • Advertising:

Utilize online platforms (e.g., Zillow, Apartments.com) and social media to advertise available units.
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• Touring and Leasing:

Schedule showings and provide prospective tenants with detailed information on available units.
• Lease Agreements:

Ensure all lease agreements are comprehensive, legally compliant, and tailored to the property.

Action Steps:
• Set up automated reminders for lease renewals and lease terminations. • Develop a standard marketing plan for each available unit(photos, descriptions, etc.). • Provide incentives for referrals or long-term leases.

4. Financial Management
Objective:

To ensure financial health and sustainability through sound budgeting, accounting, and reporting practices.

Key Areas of Focus:
• Rent Collection:

Set up online payment options and a clear rent collection schedule. Provide tenants with multiple payment options (e.g., bank transfer, credit card). • Budgeting & Forecasting:

Develop annual budgets for each property, including maintenance, repairs, insurance, taxes, and operating costs.
• Cash Flow Management:

Regularly monitor cash flow, ensuring sufficient funds are available for operations and capital expenditures.
• Financial Reporting:

Provide detailed monthly financial reports to property owners, highlighting revenue, expenses, and occupancy rates.
• Owner Distributions:

Ensure timely and accurate distribution of rental income to property owners.

Action Steps:
• Use accounting software (e.g., QuickBooks, AppFolio) for streamlined financial management.
• Schedule monthly or quarterly meetings with property owners to discuss financial performance.
• Create a reserve fund for unexpected expenses and major repairs. 24 46708.00109\42980333.1
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5. Legal Compliance & Risk Management
Objective:

To ensure full compliance with California tenant-landlord laws, local ordinances, and federal regulations, while minimizing legal risks and liabilities.

Key Areas of Focus:
• Legal Compliance:

Ensure that all leases, rental agreements, and tenant interactions comply with California's landlord-tenant laws, include but not limited to fair housing laws, rent control ordinances (where applicable), security deposit regulations, and habitability standards. Stay up-to date with any changes in state and regulations.
• Insurance:

Maintain comprehensive property insurance, including landlord liability coverage and ensure it aligns with California requirements for coverage of rental properties. • Risk Management:

Implement risk mitigation strategies, such as proper signage, security measures, and regular fire safety inspections.

Action Steps:
• Regularly review and update lease agreements to ensure compliance with any new or updated California landlord-tenant laws, including rent control, eviction protections, and habitability standards.
• Conduct annual insurance reviews to ensure coverage meets California's legal requirements and protects against potential liabilities. • Provide tenants with clear, updated emergency evacuation plans, contact information, and compliance with California's required notices.

6. Reporting & Analytics
Objective:

To provide property owners with regular updates and insights into the performance of their investments.

Key Areas of Focus:
• Occupancy &Vacancy Rates:

Provide monthly reports on occupancy rates, average days vacancy, tenant turnover and trends in leasing activity.
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• Maintenance Costs:

Track maintenance and repair expenses. identify cost-effective solutions, and report on opportunities to reduce spending while maintaining property standards.000 • Revenue & Expense Tracking:

Monitor rental income, operating expenses, and capital improvements to ensure alignment with the property's financial objectives and overall profitability.

Action Steps:
• Provide quarterly reports covering financial results, and anticipated maintenance needs. • Develop a system to track and assess the return on investment(ROI) for capital improvements, ensuring it is reflected in budgets and profit and loss statements. This system will consider income, regular and capital expenses, new operating income (NOI) occupancy rate, vacancy loss, and tenant turnover. These financial metrics will help inform future budgeting and investment decisions.

7. Technology Integration
Objective:

To leverage technology to streamline operations, improve efficiency, and enhance the tenant experience.

Key Areas of Focus:
• Property Management Software:

Utilize property management software (e.g., Buildium, AppFolio)to streamline tasks such as rent collection, maintenance tracking, and tenant communication. • Online Payment Systems:

Set up secure,user-friendly online portals for rent payments and maintenance requests. • Automation:

Automate routine tasks like lease renewals, rent reminders, and maintenance requests to reduce administrative workload.

Action Steps:
• Invest in a comprehensive property management platform to centralize tasks. • Encourage tenants to use the online portal for ease of communication and payments. • Regularly review and update software to ensure it aligns with the company's needs.

Conclusion
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This Property Management Plan provides a framework for effectively managing 296 residential units. By focusing on maintenance, tenant relations, leasing, financial management, and legal compliance, the plan ensures efficient operations and maximized property value. Regular evaluations and adjustments to this plan will ensure the company can adapt to evolving market conditions and continue providing exceptional service to tenants and property owners alike. 27 46708.00109\42980333.1
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�4 OF UA.4.4
C . ° CALIFORNIA LEVINE ACT DISCLOSURE STATEMENT aq �� tir
tlFOR�
California Government Code Section 84308, commonly referred to as the "Levine Act," prohibits City Officers from participating in any action concerning a license, permit,other entitlement for use,franchise, or contract(collectively"license, permit,or contract")if they receive political contribution(s)from a party, or its agent(s), totaling more than $500 within the twelve (12) months before the proceeding, while a proceeding is pending, and for twelve (12) months following the date of a final decision in a proceeding.

1. Have you or your company,or any agent/board member on behalf of you or your company/entity, made any political contributions of more than $500 to any Upland City Council Member in the 12 months preceding the date of the submission of your proposal or application,or the anticipated date of any Council action?
YES If yes, please identify the Council Member(s):

VNO
Answering yes to either of the two questions above does not preclude the Upland City Council from awarding a contract or approving an application or any subsequent action. It does, however, preclude the identified Council Member(s)from participating in any actions related to your proposal or application. 03/04/2025
Date Sign ure of authorized individual

RP COMPANY
Company/Applicant Name
(Levine Act definitions on reverse side)

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4,c trpl CITY
UPLAND
„.;
"The City of Gracious Living"
tIFOBS

1. Staff(kr°flit
DATE: March 10,2025
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY: CHRIS ALANIS,INTERIM PUBLIC WORKS DIRECTOR

BOB CRITCHFIELD,ENGINEERING MANAGER

KIRK SWANNER,ASSOCIATE ENGINEER
SUBJECT: CONSIDER APPROVING THE NOTICE OF COMPLETION FOR CITYWIDE SLURRY SEALS
RECOMMENDED ACTION:

It is recommended that the City Council: 1) approve the work; 2) authorize the City Manager or designee to record the Notice of Completion;3)reduce the Faithful Performance Bond to 10%for the Citywide Slurry Seals Project;and 4)authorize a change order increase of$19,522.86 to cover the final construction cost.

GOAL STATEMENT
The proposed action supports the City's goal to maintain and improve the City's public roadway facilities.

BACKGROUND
On August 12, 2024, the City Council awarded the Citywide Slurry Seals Project to Pavement Coatings Co. and authorized $595,000 (including contingencies) for the work. The project consisted of crack sealing and pavement reconstruction in localized failure areas,followed by the application of slurry seal to the asphalt pavement surface and replacement of traffic striping.

ISSUES AND ANALYSIS
The contractor has since satisfactorily completed the required improvements.The City can now approve the work,file the Notice of Completion,and reduce the Faithful Performance Bond to 10%.The City will retain the Labor materials Bond for six(6)months and release it thereafter,provided no liens or stop notice are filed against the project.

The final project construction cost exceeded the authorized appropriation amount by$19,522.86,mainly attributed to additional slurry seal quantities and replacing corresponding"STOP"legends.

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 any expansion of use beyond that which is existing.The City filed the Notice of Exemption with the County of San Bernardino on June 20,2024.

FISCAL IMPACTS
The final construction cost of $614,522.86 is $19,522.86 (3.28%) over the authorized appropriation amount of $595,000. There is sufficient funding available in the CIP project budget Account No. 2047500-70019 to cover the overage of$19,522.86.

ALTERNATIVES
Provide alternative direction to staff.

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

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Recording requested by
and when recorded mail to:

City of Upland, City Clerk's Office
460 N. Euclid Avenue
Upland, CA 91786
(Space above this line for Recorder's use)
This document is exempt from the payment of a recording fee pursuant to Government Code Section 27383
Notice of Completion
Pursuant to Civil Code Section 3093, NOTICE is hereby given that:

The undersigned is the owner of the interest or estate stated below in the property hereinafter described. The full name and address of owner is City of Upland, 460 North Euclid Avenue, Upland, California 91786.

Assessors Parcel Numbers N/A, in and to the hereinafter described property.

The work was completed on that certain work known as Project No. 70014, 70017 & 70019, Citywide Slurry Seals for the undersigned City of Upland, a Municipal Corporation, on the 16th day of January, 2025.

The City accepted the job on the 10th day of March, 2025.

The Contractor on said job was Pavement Coatings Co. of Jurupa Valley, California.

The improvement(s) consisted of crack sealing and pavement reconstruction in localized failure areas, followed by the application of slurry seal to the asphalt pavement surface and replacement of traffic striping; and the location of the improvements occurred along various public streets, in Upland, California.

The surety was The Ohio Casualty Insurance Company.

All communications relating to the contract should bear the number above mentioned.

I hereby certify under penalty of perjury that the foregoing is true and correct.

Executed this 10th day of March, 2025 at Upland, California.

City of Upland, a Municipal Corporation
Michael Blay, City Manager

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4,c trpl CITY
UPLAND
„.;
"The City of Gracious Living"
tIFOBS

1. Staff(kr°flit
DATE: March 10,2025
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:CHRIS ALANIS,INTERIM PUBLIC WORKS DIRECTOR
SUBJECT: CONSIDER THE APPROVAL OF THE PURCHASE OF NEW CITY VEHICLES RECOMMENDED ACTION:

It is recommended that the City Council: 1)approve the purchase of five(5)2025 model year Dodge Durango Police Patrol vehicles,one(1)2025 model year Ford F-150 Police Responder,and one(1)2025 model year Ford F-550 Super Duty Truck with National Auto Fleet Group of Watsonville, California, for a total amount of$405,492.44; and 2) authorize the City Manager execute all necessary documents related to the vehicle purchases.

GOAL STATEMENT
The proposed action supports the City's goal of the ongoing long-term citywide fleet replacement and modernization program.

BACKGROUND
On June 10,2024,the City Council approve Resolution No.6779 adopting the Fiscal Year 2024-2025 and 2025-2026 Annual Budgets. Included in the Fiscal Year 2024-2025 Fleet Maintenance & Replacement Internal Service Fund budget of$1,258,980 was$357,000 set aside for the purchase of five Dodge Durangos.

ISSUES AND ANALYSIS
The Public Works Department is responsible for the acquisition, maintenance and repair of the City's fleet vehicles and equipment.As part of the City's long term fleet replacement and modernization program,the Fleet Maintenance Division works with all City departments on designing,acquisition,and vehicle replacement.With the approval of the Fiscal Year 2024-25 budget,the Public Works Operations and Maintenance Division requested quotes from dealers through Sourcewell.

The City of Upland is a Sourcewell member. Sourcewell, formerly known as the National Joint Powers Alliance (NJPA),is a self-sustaining government organization that provides contract purchasing solutions through Cooperative Purchasing. This arrangement allows multiple agencies to aggregate volume to enhance purchasing power. This procurement process meets the State of California' s Cooperative Purchasing Code 6500 & 6502, and Upland Municipal Code Section 2.48.080,allowing the City to dispense with the bidding procedures from suppliers who have been awarded a contract resulting from a formal competitive bidding process by another government agency.

FISCAL IMPACTS
The total cost for the purchase of vehicles is$405,492.44.There are available funds in the following accounts:
#of Vehicle Make/Model Expenditure Account No.

Vehicles
5 2025 Police Patrol Dodge Durango $ 279,671.00 7523211-5531 1 2025 Ford F-150 Police Responder $ 57,164.30 7523201-5531 1 2025 F-550 Ford Super Duty $ 68,657.14 7525201-5531

ALTERNATIVES
Provide alternative direction to staff.

CEQA:Not a Project.

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. :. National Auto Fleet Group
A DlwIalon of Chewrolet of YYateonwllle
49fl Auto Center Drive. Watsonville, CA 9507H
(855) 289-6572 • (B31) 480-8407 Fox
Flu et Natp nu IA u to FI eetn roup,.om
11/15/2024 Quote ID: 30325 R1
12/4/2024 Re-Configured
Mr Jose Reyes
City of Upland PD
460 N. Euclid Ave
Upland, California, 91786
Dear Jose Reyes,
National Auto Fleet Group is pleased to quote the following vehicle(s)for your consideration.

Three (3) New/Unused (2025 Dodge Durango (WDEE75) Pursuit AWD, Black and White Paint) and delivered to your specified location, each for
One Unit One Unit Total % Extended Total Savings (MSRP) Savings Unit's (3)
Contract Price $51,245.00 $50,459.81 1.532 % $151,379.43 $2,355.57 Tax (7.7500 %) $3,910.64 $11,731.92
Black and White $1,350.00 $4,050.00
Paint
Tire fee $8.75 $26.25
Transportation $205.00 $615.00
Total $55,934.20 $167,802.60
- per the attached specifications.

This vehicle(s) is available under the Sourcewell Contract 091521-NAF . Please reference this Contract number on all purchase orders to National Auto Fleet Group. Payment terms are Net 20 days after receipt of vehicle.

Thank you in advance for your consideration. Should you have any questions, please do not hesitate to call.

Sincerely,
Yesenia Covarrubias/Joshua Jerome
Fleet Department
Account Manager
[email protected]
(626)457-5590
.(7W7> '
h.N155AI�i ( �7 i�-
CHEVROLET TOYOTA

Page 103 of 168 ends

Vehicle Configuration Options
ENGINE
Code Description
Engine: 5.7L V8 HEMI MDS VVT, -inc: 3.09 Rear Axle Ratio, Dual Rear Exhaust w/Bright EZH Tips, 230MM Rear Axle, 800 Amp Maintenance Free Battery, 2 Speed On Demand Transfer Case, GVWR: 7,100 lbs

TRANSMISSION
Code Description
DFD Transmission: 8-Speed Automatic (8HP70)
WHEELS
Code Description
WBN Wheels: 18" x 8.0" Black Steel, (STD)

PRIMARY PAINT
Code Description
PXJ DB Black Clearcoat

SEAT TYPE
Code Description
C5X9 Black, Cloth Bucket Seats w/Shift Insert, -inc: cloth rear seat

AXLE RATIO
Code Description
DPM 3.09 Rear Axle Ratio
GVWR
Code Description
Z6J GVWR: 7,100 lbs

CPOS PKG
Code Description
22Z Quick Order Package 22Z, -inc: Engine: 5.7L V8 HEMI MDS VVT, Transmission: 8-Speed Automatic (8HP70)

ADDITIONAL EQUIPMENT
Code Description
ADL Skid Plate Group, -inc: Transfer Case Skid Plate Shield, Front Suspension Skid Plate, Fuel Tank Skid Plate Shield, Underbody Skid Plate

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LNF Black Left LED Spot Lamp
LNA Black Right LED Spot Lamp
CW6 Deactivate Rear Doors/Windows
GXF Entire Fleet Alike Key (FREQ 1), -inc: 4 additional key alike fobs / 8 total

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2025 Fleet/Non-Retail Dodge Durango Pursuit AWD

WINDOW STICKER
2025 Dodge Durango Pursuit AWD
CODE MODEL MSRP
WDEE75 2025 Dodge Durango Pursuit AWD $43,940.00

OPTIONS
EZH Engine: 5.7L V8 HEMI MDS VVT, -inc: 3.09 Rear Axle Ratio, Dual Rear Exhaust w/Bright Tips, $3,240.00 230MM Rear Axle, 800 Amp Maintenance Free Battery, 2 Speed On Demand Transfer Case, GVWR: 7,100 lbs
DFD Transmission: 8-Speed Automatic(8HP70) $0.00 WBN Wheels: 18"x 8.0" Black Steel, (STD) $0.00 PXJ DB Black Clearcoat $0.00
C5X9 Black, Cloth Bucket Seats w/Shift Insert, -inc: cloth rear seat $0.00 DPM 3.09 Rear Axle Ratio INC
Z6J GVWR: 7,100 lbs INC
22Z Quick Order Package 22Z, -inc: Engine: 5.7L V8 HEMI MDS VVT, Transmission: 8-Speed $0.00 Automatic(8HP70)
ADL Skid Plate Group, -inc: Transfer Case Skid Plate Shield, Front Suspension Skid Plate, Fuel Tank $370.00 Skid Plate Shield, Underbody Skid Plate
LNF Black Left LED Spot Lamp $750.00 LNA Black Right LED Spot Lamp $750.00
CW6 Deactivate Rear Doors/Windows $145.00 GXF Entire Fleet Alike Key(FREQ 1), -inc: 4 additional key alike fobs/8 total $455.00 Please note selected options override standard equipment SUBTOTAL $49,650.00
Advert/Adjustments $0.00
Manufacturer Destination Charge $1,595.00
TOTAL PRICE $51,245.00
Est City: N/A MPG
Est Highway: N/A MPG
Est Highway Cruising Range: N/A mi
Any performance-related calculations are offered solely as guidelines.Actual unit performance will depend on your operating conditions.

Notes

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Standard Equipment

MECHANICAL
Engine: 3.6L V6 24V VVT UPG I w/ESS (STD)
Transmission: 8-Speed Automatic (850RE) (STD)

3.45 Rear Axle Ratio (STD)
GVWR: 6,500 lbs (STD)

EXTERIOR
Wheels: 18" x 8.0" Black Steel (STD)
TIRES
Tires: 255/60R18 BSW On/Off Road

ADDITIONAL EQUIPMENT
50 State Emissions
Transmission w/Sequential Shift Control 1
Full-Time All-Wheel
Engine Oil Cooler
650CCA Maintenance-Free Battery w/Run Down Protection
220 Amp Alternator
Class IV Towing Equipment -inc: Hitch and Trailer Sway Control Trailer Wiring Harness
Police/Fire
1250# Maximum Payload
Front And Rear Anti-Roll Bars
Gas-Pressurized Front Shock Absorbers and Nivomat Brand Name Rear Shock Absorbers Nivomat Suspension
HD Suspension
Electric Power-Assist Speed-Sensing Steering

24.6 Gal. Fuel Tank
Single Stainless Steel Exhaust
Permanent Locking Hubs
Short And Long Arm Front Suspension w/Coil Springs
Multi-Link Rear Suspension w/Coil Springs
4-Wheel Disc Brakes w/4-Wheel ABS, Front And Rear Vented Discs, Brake Assist and Hill Hold Control Wheels w/Chrome Hub Covers
f Page 10/ of 168

Steel Spare Wheel
Compact Spare Tire Stored Underbody w/Crankdown
Clearcoat Paint
Body-Colored Front Bumper w/Colored Rub Strip/Fascia Accent Body-Colored Rear Step Bumper w/Colored Rub Strip/Fascia Accent Black Side Windows Trim
Body-Colored Door Handles
Chrome Bodyside Insert and Colored Wheel Well Trim
Black Power Heated Side Mirrors w/Manual Folding
Fixed Rear Window w/Fixed Interval Wiper and Defroster
Deep Tinted Glass
Speed Sensitive Variable Intermittent Wipers
Galvanized Steel/Aluminum Panels
Lip Spoiler
Black Grille
Liftgate Rear Cargo Access
Tailgate/Rear Door Lock Included w/Power Door Locks
Auto On/Off Projector Beam Led Low/High Beam Daytime Running Headlamps w/Delay-Off Perimeter/Approach Lights
LED Brakelights
Laminated Glass
Radio w/Seek-Scan, Clock, Speed Compensated Volume Control, Aux Audio Input Jack, Steering Wheel Controls and Radio Data System
Radio: Uconnect 4 w/8.4" Display
6 Speakers
Streaming Audio
GPS Antenna Input
Integrated Center Stack Radio
Integrated Voice Command w/Bluetooth
2 LCD Monitors In The Front
Front Seats w/Power 4-Way Driver Lumbar
12-Way Power Driver Seat -inc: Power Recline, Height Adjustment, Fore/Aft Movement, Cushion Tilt and Power 4-Way Lumbar Support
4-Way Passenger Seat -inc: Manual Recline, Fore/Aft Movement and Fold Flat 60-40 Folding Split-Bench Front Facing Fold Forward Seatback Rear Seat Manual Tilt/Telescoping Steering Column
Gauges -inc: Speedometer, Odometer, Voltmeter, Oil Pressure, Engine Coolant Temp, Tachometer, Oil Temperature, Transmission Fluid Temp, Engine Hour Meter, Trip Odometer and Trip Computer Power Rear Windows and Fixed 3rd Row Windows
Leather Steering Wheel
Front Cupholder

Page 108 of 168 ends

Rear Cupholder
Compass
Proximity Key For Doors And Push Button Start
Valet Function
Remote Keyless Entry w/lntegrated Key Transmitter, 2 Door Curb/Courtesy, Illuminated Entry and Panic Button
Cruise Control w/Steering Wheel Controls
Voice Activated Dual Zone Front Automatic Air Conditioning Rear HVAC w/Separate Controls
HVAC -inc: Auxiliary Rear Heater, Headliner/Pillar Ducts and Console Ducts Illuminated Locking Glove Box
Driver Foot Rest
Interior Trim -inc: Leatherette/Metal-Look Instrument Panel Insert, Metal-Look Door Panel Insert and Chrome Interior Accents
Full Cloth Headliner
Cloth Bucket Seats w/Shift Insert -inc: cloth rear seat Day-Night Auto-Dimming Rearview Mirror
Driver And Passenger Visor Vanity Mirrors
Partial Floor Console w/Covered Storage, Mini Overhead Console w/Storage and 3 12V DC Power Outlets
Front And Rear Map Lights
Fade-To-Off Interior Lighting
Carpet Floor Trim
Full Vinyl/Rubber Floor Covering
Cargo Area Concealed Storage
Cargo Space Lights
Smart Device Integration
FOB Controls -inc: Cargo Access and Windows
Google Android Auto
USB Host Flip
Apple CarPlay
Driver/ Passenger And Rear Door Bins
Power 1st Row Windows w/Driver And Passenger 1-Touch Up/Down Delayed Accessory Power
Power Door Locks w/Autolock Feature
Driver Information Center
Redundant Digital Speedometer
Trip Computer
Outside Temp Gauge
Digital/Analog Appearance
Front Center Armrest w/Storage and Rear Center Armrest

Page 109 of 168 ends

#7 Seat Foam Cushion
Manual w/Tilt Front Head Restraints and Fixed Rear Head Restraints Sentry Key Immobilizer
3 12V DC Power Outlets
Air Filtration
Electronic Stability Control (ESC)And Roll Stability Control (RSC) ABS And Driveline Traction Control
Side Impact Beams
Dual Stage Driver And Passenger Seat-Mounted Side Airbags ParkSense with Stop Rear Parking Sensors
Collision Mitigation-Rear
Blind Spot w/Trailer Detection Blind Spot
Tire Specific Low Tire Pressure Warning
Dual Stage Driver And Passenger Front Airbags
Curtain 1st, 2nd And 3rd Row Airbags
Airbag Occupancy Sensor
Driver Knee Airbag
Rear Child Safety Locks
Outboard Front Lap And Shoulder Safety Belts -inc: Rear Center 3 Point, Height Adjusters and Pretensioners
ParkView Back-Up Camera

Page 110 of 168 ends

. :. National Auto Fleet Group
A 131wlslon of Chewrolet of YYateonwl Ile
49fl Auto Center Drive. Watsonville, CA 9507H
(855) 299-6572 • [B31) 480-8407 Fox
Flu etaNationu IA°to FI eetn roup.ourn
1/15/2025 Quote ID: 30805
Mr Jose Reyes
City of Upland PD
460 N. Euclid Ave
Upland, California, 91786
Dear Jose Reyes,
National Auto Fleet Group is pleased to quote the following vehicle(s)for your consideration.

One (1) New/Unused (2025 Ford F-150 Police Responder(W1P) XL 4WD SuperCrew 5.5' Box 145" WB, ) and delivered to your specified location, each for
One Unit One Unit Total % Total Savings (MSRP) Savings
Contract Price $54,240.00 $52,854.34 2.555 % $1,385.66 Tax (7.7500 %) $4,096.21
Tire fee $8.75
Transportation $205.00
Total $57,164.30
- per the attached specifications.

Thank you in advance for your consideration. Should you have any questions, please do not hesitate to call.

Sincerely,
Yesenia Covarrubias/Joshua Jerome
Fleet Department
Account Manager
[email protected]
(626) 457-5590
��IYXCL�� NISSAN VriJ' ..P"/,._.

CHEVHOLET TOYOTA

Page 111 of 168 ends

Vehicle Configuration Options
ENGINE
Code Description
998 Engine: 3.5L V6 EcoBoost, (STD)

TRANSMISSION
Code Description
44G Transmission: Electronic 10-Speed Automatic, (STD)

PRIMARY PAINT
Code Description
UM Agate Black Metallic

SEAT TYPE
Code Description
Black, HD Police-Grade Cloth 40/Blank/40 Front-Seats, -inc: reduced bolsters, 8-way PB power driver/manual passenger, built-in steel intrusion plates in both front-seatbacks, center-section deleted (restraint control module cover provided) and vinyl rear bench

ADDITIONAL EQUIPMENT
Code Description 1
924 Rear Window Fixed Privacy Glass w/Defroster
18B Black Platform Running Boards
153 Front License Plate Bracket, -inc: Standard in states where required by law, optional to all others

OPTION PACKAGE
Code Description
150A Equipment Group 150A

Page 112 of 168 ends

2025 Fleet/Non-Retail Ford F-150 Police Responder XL 4WD SuperCrew 5.5' Box 145" WB

WINDOW STICKER
2025 Ford F-150 Police Responder XL 4WD SuperCrew 5.5' Box 145"WB CODE MODEL MSRP
W1 P 2025 Ford F-150 Police Responder XL 4WD SuperCrew 5.5' Box 145"WB $51,890.00

OPTIONS
998 Engine: 3.5L V6 EcoBoost, (STD) $0.00 44G Transmission: Electronic 10-Speed Automatic, (STD) $0.00 UM Agate Black Metallic $0.00
PB Black, HD Police-Grade Cloth 40/Blank/40 Front-Seats, -inc: reduced bolsters, 8-way power $0.00 driver/manual passenger, built-in steel intrusion plates in both front-seatbacks, center-section deleted (restraint control module cover provided)and vinyl rear bench 924 Rear Window Fixed Privacy Glass w/Defroster $100.00 18B Black Platform Running Boards $255.00 153 Front License Plate Bracket, -inc: Standard in states where required by law, optional to all others $0.00 150A Equipment Group 150A $0.00
Please note selected options override standard equipment SUBTOTAL $52,245.00
Advert/Adjustments $0.00
Manufacturer Destination Charge $1,995.00
TOTAL PRICE $54,240.00
Est City: 17 (2024) MPG
Est Highway: 23 (2024) MPG
Est Highway Cruising Range: 598.00 mi
Any performance-related calculations are offered solely as guidelines.Actual unit performance will depend on your operating conditions.

Notes

Page 113 of 168 ends

Standard Equipment

MECHANICAL
Engine: 3.5L V6 EcoBoost -inc: 120-MPH top speed (STD)
Transmission: Electronic 10-Speed Automatic -inc: selectable drive modes: normal/tow-haul/snow- wet/EcoSelect/sport and SelectShift automatic w/progressive range select (STD)

ADDITIONAL EQUIPMENT
50 State Emissions System
Electronic Transfer Case
Automatic Full-Time Four-Wheel Drive
Driver Selectable Rear Locking Differential
Electronic Locking w/3.31 Axle Ratio
80-Amp/Hr 800CCA Maintenance-Free Battery w/Run Down Protection HD 240 Amp Alternator
Class IV Towing Equipment -inc: Hitch and Trailer Sway Control Trailer Wiring Harness
3 Skid Plates
Police/Fire
1970# Maximum Payload
GVWR: 7,075 lbs Payload Package
HD Shock Absorbers
Front HD Anti-Roll Bar
Off-Road Suspension
Electric Power-Assist Speed-Sensing Steering
26 Gal. Fuel Tank
Single Stainless Steel Exhaust
Auto Locking Hubs
Double Wishbone Front Suspension w/Coil Springs
Solid Axle Rear Suspension w/Leaf Springs
4-Wheel Disc Brakes w/4-Wheel ABS, Front And Rear Vented Discs, Brake Assist, Hill Descent Control, Hill Hold Control and Electric Parking Brake
Regular Box Style
Wheels: 18" Steel
Tires: LT265/70R18 BSW A/T
Steel Spare Wheel
Full-Size Spare Tire Stored Underbody w/Crankdown
Clearcoat Paint
Black Front Bumper w/Black Rub Strip/Fascia Accent and 2 Tow Hooks

Page 114 of 168 ends

Black Rear Step Bumper
Black Side Windows Trim
Black Door Handles
Black Power Side Mirrors w/Manual Folding
Fixed Rear Window
Light Tinted Glass
Variable Intermittent Wipers
Aluminum Panels
Black Grille
Tailgate Rear Cargo Access
Tailgate/Rear Door Lock Included w/Power Door Locks
Ford Co-Pilot360 -Autolamp Auto On/Off Reflector Led Low/High Beam Daytime Running Lights Preference Setting Headlamps w/Delay-Off
Cargo Lamp w/High Mount Stop Light
Radio w/Seek-Scan, Speed Compensated Volume Control and Radio Data System Radio: AM/FM Stereo w/6 Speakers
SYNC 4 -inc: 12" LCD capacitive touchscreen w/swipe capability, AppLink w/App catalog, 911 Assist, Apple CarPlay and Android Auto compatibility, digital owners manual and conversational voice command recognition
Fixed Antenna
2 LCD Monitors In The Front
Driver Seat
Passenger Seat
60-40 Folding Split-Bench Front Facing Fold-Up Cushion Rear Seat Manual Tilt/Telescoping Steering Column
Gauges -inc: Speedometer, Odometer, Voltmeter, Oil Pressure, Engine Coolant Temp, Tachometer, Transmission Fluid Temp, Engine Hour Meter and Trip Odometer Power Rear Windows
FordPass Connect 5G Mobile Hotspot Internet Access
Front Cupholder
Rear Cupholder
Compass
Cruise Control w/Steering Wheel Controls
Manual Air Conditioning
HVAC -inc: Underseat Ducts
Glove Box
HD Police-Grade Cloth 40/Blank/40 Front-Seats -inc: reduced bolsters, 8-way power driver/manual passenger, built-in steel intrusion plates in both front-seatbacks, center-section deleted (restraint control module cover provided) and vinyl rear bench
Interior Trim -inc: Cabback Insulator and Chrome Interior Accents Full Cloth Headliner
Urethane Gear Shifter Material

Page 115 of 168 ends

Day-Night Rearview Mirror
Passenger Visor Vanity Mirror
Mini Overhead Console w/Storage and 2 12V DC Power Outlets Fade-To-Off Interior Lighting
Full Vinyl/Rubber Floor Covering
Pickup Cargo Box Lights i
Fleet Telematics Modem Tracker System
Instrument Panel Bin, Dashboard Storage, Interior Concealed Storage, Driver/ Passenger And Rear 1 Door Bins
Power 1st Row Windows w/Driver And Passenger 1-Touch Up/Down Power Door Locks w/Autolock Feature
Redundant Digital Speedometer
Outside Temp Gauge
Analog Appearance
Seats w/Cloth Back Material
Manual Adjustable Front Head Restraints and Manual Adjustable Rear Head Restraints Perimeter Alarm
2 12V DC Power Outlets
Air Filtration
AdvanceTrac w/Roll Stability Control Electronic Stability Control (ESC) And Roll Stability Control (RSC) ABS And Driveline Traction Control
Side Impact Beams
Dual Stage Driver And Passenger Seat-Mounted Side Airbags Reverse Sensing System Rear Parking Sensors
BLIS with Trailer Tow Coverage Blind Spot
Automatic Emergency Braking
Ford Co-Pilot360 - Lane-Keeping Assist Lane Keeping Assist Ford Co-Pilot360 - Lane-Keeping Assist Lane Departure Warning Collision Mitigation-Front
Collision Mitigation-Rear
Tire Specific Low Tire Pressure Warning
Dual Stage Driver And Passenger Front Airbags
Safety Canopy System Curtain 1st And 2nd Row Airbags
Airbag Occupancy Sensor
Rear Child Safety Locks
Outboard Front Lap And Shoulder Safety Belts -inc: Rear Center 3 Point, Height Adjusters and Pretensioners
Ford Co-Pilot360 - Reverse Camera Back-Up Camera

Page 116 of 168 ends

2/18/25, 11:55 AM
National Auto Fleet Group
A Division of CI+er+olot of Weteonviiie
490 Auto Center Drive, Watsonville, CA 95076
(855) 289-8572• (831) 480-8497 Fax
FleetaNatiana lAutoF IeetGroup.00 m
2/18/2025 Quote ID: 31219
Order Cut Off Date: TBA
Mr Marc Warner
City of Upland
460 N. Euclid Ave.

Upland, California, 91786
Dear Marc Warner,
National Auto Fleet Group is pleased to quote the following vehicle(s) for your consideration. One (1) New! Unused 2025 Ford Super Duty F-550 DRW (X5H) XL 4WD SuperCab 192"WB 84" CA, delivered to your specified location, each for
One Unit One Unit Total % Total Savings (MSRP) Savings
Contract Price $65,300.00 $63,546.77 2.685 % $1,753.23 Tax (7.7500 %) $4,924.87
Tire fee $10.50
Transportation $175.00
Total $68,657.14
- per the attached specifications.

Thank you in advance for your consideration. Should you have any questions, please do not hesitate to call.

Sincerely,
Yesenia Covarrubias
Fleet Department Account Manager
[email protected]
(626) 457-5590
(19-Th
kliSSAAL, U M C:

CHEVt;OIET ` TOYOTA
T --
https:11 www.nationalautofleetgroup.comlOrderRequestJSSDPrinti31219?ws=true&se=true&ssdType=Quickouote Page 117 of 168

2/18/25, 11:55 AM Sell,service,and deliver letter Vehicle Configuration Options
ENGINE
Code Description
99N Engine: 7.31_2V DEVCT NA PFI V8 Gas, (STD)

TRANSMISSION
Code Description
44G Transmission: TorqShift 10-Speed Automatic, (STD) TIRES
Code Description
TGJ Tires: 225/70Rx19,5G BSWA/P, (STD) A

PRIMARY PAINT
- _.

Code Description
Z1 Oxford White
SEAT TYPE•
Code Description
Medium Dark Slate, HD Vinyl 40/20/4 i ...

AS 140 Split Bench Seat, -inc: center armrest, cupholder, storage, 2-way adjustable driver/passenger headrests and driver's side manual lumbar

ADDITIONAL EQUIPMENT
Code Description
86M Dual 68 AH/65 AGM Battery
67A 350 Amp Dual Alternators, -Inc. 190 Amp + 160 Amp GVWR: 19,550 lb Payload Plus Upgrade Package -inc:
y pg g 2, -nc: upgraded frame, upgraded rear-
68H axle and low deflection/high capacity rear springs, Increases max RGAWR to 14,706 Ibs, Note: See Order Guide Supplemental Reference for further details on GVWR Rear View Camera & Prep Kit, -inc: Pre-installed content includes cab wiring and frame 872 wiring to the rear most cross member, Upfitters kit includes camera w/mounting bracket, 20' jumper wire and camera mounting/aiming instructions
76C 'Exterior Backup Alarm (Pre-Installed)

OPTION PACKAGE
Code Description
660A Order Code 660A
https:!l www.nationalautofleetgroup.coralOrderRequest/SSDPrint/31219?ws=true&se=true&ssdType=QuickQuote Page 118 of 168

2/18/25, 11:55 AM Sell,service,and deliver letter 2025 Fleet/Non-Retail Ford Super Duty F-550 DRW XL 4WD SuperCab 192" WB 84" CA

WINDOW STICKER
2025 Ford Super Duty F-550 DRW XL 4WD SuperCab 192"WB 84" CA CODE MODEL MSRP
X5H 2025 Ford Super Duty F-550 DRW XL 4WD SuperCab 192"WB 84" CA $61,305.00

OPTIONS
99N Engine: 7.3L 2V DEVCT NA PFI V8 Gas, (STD) $0.00 44G Transmission: TorqShift 10-Speed Automatic, (STD) $0.00 TGJ Tires: 225/70Rx19.5G BSWAIP, (STD) $0.00 Z1 Oxford White $0.00
AS Medium Dark Slate, HD Vinyl 40/20/40 Split Bench Seat, -inc: center armrest, cupholder, storage, $0.00 2-way adjustable driver/passenger headrests and driver's side manual lumbar 86M Dual 68 AH/65 AGM Battery $210.00
67A 350 Amp Dual Alternators, -inc: 190 Amp+ 160 Amp $0.00 68H GVWR: 19,550 lb Payload Plus Upgrade Package 2, -inc: upgraded frame, upgraded rear-axle and $1,155.00 low deflection/high capacity rear springs, Increases max RGAWR to 14,706 Ibs, Note: See Order Guide Supplemental Reference for further details on GVWR 872 Rear View Camera & Prep Kit, -inc: Pre-installed content includes cab wiring and frame wiring to $415.00 the rear most cross member, Upfitters kit includes camera w/mounting bracket, 20'jumper wire and camera mounting/aiming instructions
76C Exterior Backup Alarm (Pre-Installed) $220.00 660A Order Code 660A $0.00
Please note selected options override standard equipment SUBTOTAL $63,305.00
Advert/Adjustments $0.00
Manufacturer Destination Charge $1,995.00
TOTAL PRICE $65,300.00
Est City: N/A MPG
Est Highway: N/A MPG
Est Highway Cruising Range: N/A mi
Any performance-related calculations are offered solely as guidelines.Actual unit performance will depend on your operating conditions.

Notes
https://www.nationalautofleetgroup.comIOrderRequestJSSDPrint/31219?ws=true&se=true&ssdType=QuickQuote Page 119 of 168

2118/25,11:55 AM Sell,service,and deliver letter Standard Equipment

MECHANICAL
Engine: 7.3L 2V DEVCT NA PFI V8 Gas (STD)
Transmission: TorqShift 10-Speed Automatic -inc: 10R140 w/neutral idle, SelectShift and selectable .drive modes: normal, tow/haul, eco, slippery roads and off-road (STD)

4.88 Axle Ratio (STD)

EXTERIOR
Tires: 225/70Rx19.5G BSWA/P (STD)
WHEELS
Wheels: 19.5" x 6"Argent Painted Steel inc: Hub covers/center ornaments not included

ADDITIONAL EQUIPMENT
50-State Emissions System
Transmission w/Oil Cooler
Electronic Transfer Case
Part-Time Four-Wheel Drive
68-Amp/Hr 750CCA Maintenance-Free Battery wiRun Down Protection 190 Amp Alternator
Towing Equipment inc Trailer Sway Control
Trailer Wiring Harness
10530# Maximum Payload
GVWR: 18,000 lbs Payload Package
HD Shock Absorbers
Front And Rear Anti-Roll Bars
Firm Suspension
Hydraulic Power-Assist Steering
40 Gal. Fuel Tank
Single Stainless Steel Exhaust
'Dual Rear Wheels
Auto Locking Hubs
Front Suspension w/Coil Springs
Solid Axle Rear Suspension w/Leaf Springs
4-Wheel Disc Brakes w/4-Wheel ABS, Front And Rear Vented Discs, Brake Assist and Hill Hold Control Upfitter Switches
https:l/ www.nationalautofleetgroup,cowlOrderRequest/SSDPrint/31219?ws=true&se=true&sadType=QulckQuote Page 120 of 168

2/18/25, 11:55 AM Sell,service,and deliver letter C[ea rcoat Paint
Black Front Bumper w/Black Rub Strip/Fascia Accent and 2 Tow Hooks Black Fender Flares
Black Side Windows Trim and Black Front Windshield Trim Black Door Handles
Black Power Heated Side Mirrors w/Convex Spotter, Manual Folding and Turn Signal Indicator Manual Extendable Trailer Style Mirrors
Fixed Rear Window
Light Tinted Glass
Variable Intermittent Wipers
Aluminum Panels
Front Splash Guards
Black Grille
Reverse Opening Rear Doors
Autolamp Auto On/Off Reflector Halogen Daytime Running Lights Preference Setting Headlamps w/Delay-Off
Cab Clearance Lights
Perimeter/Approach Lights
Radio w/Seek-Scan, Clock and Speed Compensated Volume Control Radio: AM/FM Stereo wIMP3 Player-inc: 6 speakers
Fixed Antenna
SYNC 4 Communication & Entertainment System -inc: enhanced voice recognition, 911 Assist, 8" LCD center stack screen, AppLink and 1 smart-charging USB port 2 LCD Monitors In The Front
4-Way Driver Seat-inc: Manual Recline and Fore/Aft Movement 4-Way Passenger Seat -inc. Manual Recline and Fore/Aft Movement 60-40 Folding Split-Bench Front Facing Fold-Up Cushion Rear Seat Manual Tilt/Telescoping Steering Column
Gauges -inc: Speedometer, Odometer, Oil Pressure, Engine Coolant Temp, Tachometer, Transmissi on
ion
Fluid Temp, Engine Hour Meter, Trip Odometer and Trip Computer Power Rear Windows
FordPass Connect 5G Mobile Hotspot Internet Access
Rear Cupholder
Compass
Remote Keyless Entry w/Integrated Key Transmitter, Illuminated Entry and Panic Button Cruise Control w/Steering Wheel Controls
Manual Air Conditioning
HVAC -inc. Underseat Ducts
Illuminated Locking Glove Box
Interior Trim -inc: Chrome Interior Accents a Full Cloth Headliner -- https.//www,nationalautofleetgroup.com/OrderRequestlSSDPrint131219?ws=true&se=true&ssdType=QuickQuote Page 121 of 168

2/18/25, 11:55 AM Sell,service,and deliver letter Urethane Gear Shifter Material
HD Vinyl 40/20/40 Split Bench Seat-inc: center armrest, cupholder, storage, 2-way adjustable driver/passenger headrests and driver's side manual lumbar Day-Night Rearview Mirror
Passenger Visor Vanity Mirror
Full Overhead Console w/Storage and 2 12V DC Power Outlets 9 A
Front Map Lights
Fade-To-Off Interior Lighting
Full Vinyl/Rubber Floor Covering
Smart Device Remote Engine Start
Instrument Panel Covered Bin and Dashboard Storage
Power 1st Row Windows w/Driver And Passenger 1-Touch Up/Down Delayed Accessory Power
Power Door Locks w/Autolock Feature
Driver Information Center
Trip Computer
Outside Temp Gauge
Digital/Analog Appearance
Seats w/Vinyl Back Material
Manual Adjustable Front Head Restraints and Manual Adjustable Rear Head Restraints Perimeter Alarm
Securilock Anti-Theft Ignition (pats) Immobilizer
2 12V DC Power Outlets
Air Filtration
Driveline Traction Control
Side Impact Beams
Dual Stage Driver And Passenger Seat-Mounted Side Airbags Pre-Collision Assist with Automatic Emergency Braking (AEB) Lane Departure Warning
Collision Mitigation-Front
Dual Stage Driver And Passenger Front Airbags w/Passenger Off Switch Outboard Front Lap And Shoulder Safety Belts -inc: Height Adjusters Safety Canopy System Curtain 1st And 2nd Row Airbags
httpsa/ www.nationalautofleetgroup,cowlOrderRequest/SSl3Print/31219?ws=true&se=true&ssdType=QuickQuote Page 122 of 168

�� pl"� CITY
UPLAND
„.;
"The City of Gracious Living"
tIFOBS

1. Staff(kr°ill
DATE: March 10,2025
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:STEPHEN PARKER,CPA,ASSISTANT CITY MANAGER

STACI SULLIVAN,FINANCE MANAGER
SUBJECT: FISCAL YEAR 2024-25 MID-YEAR BUDGET REVIEW AND PROPOSED BUDGET

ADJUSTMENTS
RECOMMENDED ACTION:

It is recommended that the City Council: 1) Receive and file the Fiscal Year 2024-25 Mid-Year Budget Review; 2) Approve the Mid-Year Budget Review's Proposed Budget Adjustments; 3) Approve the updated Schedule of Positions;4)Approve an increase to the capital assets depreciation threshold from$5,000 to$10,000;and 5)Approve the recommended Mid-Year Fund Balance Designations.

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

BACKGROUND
On June 10, 2024, the City Council approved Resolution No. 6779 adopting the Biennial Budget for Fiscal Years 2024-25—2025-26.

On November 11,2024,the City Council received and filed the Fiscal Year 2024-25 First Quarter Budget Review.

ISSUES AND ANALYSIS
The main areas to be reviewed in the Mid-Year Budget Review include:

1. Comparing prior year projections at the time the budget was approved to audited year-end balances;and

2. Proposing budget adjustments to current year revenues and expenditures based on current information;and

3. Approving the updated Schedule of Positions.

The beginning Fund Balance was projected to be$9,585,260 when the Fiscal Year 2024-25 budget was adopted. The First Quarter Budget Review projected the General Fund Fund Balance at$15,760,270,and the final audited numbers were slightly higher,at$15,784,079. The positive difference of$6,198,819 can be attributed to an increase in revenue for the following key items:

1. Interest Income

2. Sales Tax

3. Charges for services

4. Franchise Tax

5. Development Impact Fee Reconciliation
Fiscal Year 2024-25 Revised Revenue and Transfers Out Budget Original Fiscal Year 2024-25 budgeted revenues were $61,671,040. After modifications through the First Quarter Budget Review and other City Council-approved budget adjustments,budgeted revenues increased to $62,064,913, primarily due to one-time revenue from a sales tax adjustment. After reviewing General Fund revenues to date and comparing against estimated year-end projections, there is no material change anticipated in property tax and sales tax. However,there are a few one-time revenue adjustments available at this time:

1. One-time $504,356 of ARPA interest earning and market valuations. This revenue was previously held in the ARPA Fund but should be recorded in the General Fund.

Page 123 of 168 ends

2. One-time$196,825 of increased revenues in Development Services.Between expected decreases in revenue on some line items and increases elsewhere,the total revenue generated is expected to increase over original budget. The largest expected increase is related to electrical permits.

3. One-time$179,630 of reimbursement for the Police Department School Resource Officer due to fiscal year timing difference.

4. One-time$54,000 of revenue from Tesla lease for July and August. In the First Quarter Budget Update,staff reduced the full 12 months of revenue due to the cancelation of the Agreement,instead of ten(10)months.

5. One-time$20,000 of reimbursement for the Police Department special events overtime costs.

6. One-time ($30,000) reduction in estimated Road Maintenance Rehabilitation Account (RMRA) Fund 206 revenue.

With the approval of the Mid-Year Budget Review's Proposed Budget Adjustments,the General Fund's Fiscal Year 2024-25 estimated revenues will increase by$984,878 for a total budgeted revenue of$63,049,791.

Fiscal Year 2024-25 Revised Expenditures and Transfers Out Budget Original Fiscal Year 2024-25 budgeted expenditures and transfers out were$61,458,170. After modifications through the First Quarter Budget Review and other City Council-approved budget adjustments, budgeted expenditures increased to$61,830,143. At this time we do have a number of expenditure adjustments recommended at this time:

Attachment 1 identifies proposed changes to the current fiscal year budget.

General Fund(101)

1. Transfer Out to General Fund Capital Projects Fund(Account No.4257500-5528-82360)of$75,000 for the reconfiguration of office space.

2. Transfer Out to Information Systems Internal Service Fund(Account No. 101-0000-5070) of$145,500 for various computer equipment and software costs.

3. Transfer Out to Building Maintenance and Operations Internal Service Fund(Account No. 101-0000-5070) of$46,500 for maintenance and other service expenses.

4. $7,555 to Public Works Administration Professional Services Account No. 1015201-5252 to fund the remaining fiscal year contract costs with Operations Management Group.

5. $25,771 to Police Administration Account No. 1013211-5111/5116/5117 to unfreeze and fund one vacant Police Dispatcher I/II position for the remainder of the fiscal year.

6. $19,773 to Police Administration Account No. 1013211-5111/5116/5117 to cover the increased salary costs from the equity study of the Police Supervisor,Police Dispatcher II and Police Dispatcher I positions for the remainder of the fiscal year.

7. ($50,250)in reductions to various Recreation accounts to offset personnel costs for the remainder of the fiscal year.

8. ($30,067)in reduction to the Residual Equity from the CARES Act Fund.

9. $150,000 to Non-Departmental Sales Tax Share/DDA/OPA Account No. 1011504-5303 to cover the costs of the existing Sales Tax Sharing Agreement due to fiscal year timing difference.

10. $36,000 to Building and Safety Professional Services Account No. 1012201-5252 to cover the additional costs for contract/consultant services. These increased expenses are fully offset by the increased Development Services revenue mentioned above.

11. $20,000 to Building and Safety Banking Services Account No. 1012201-5255 to cover expected increased costs related to banking fees for developers using credit cards to pay fees. These increased expenses are fully offset by the increased Development Services revenue mentioned above.

12. $10,000 to Weed Abatement Other Services Account No. 1012201-5258 to cover expected increased costs related to the weed abatement program.

13. $20,000 to Economic Development Professional Services Account No. 1012203-5252 to cover unexpected costs related to the fringe benefits of administration for new programs in the downtown.

14. $15,000 to Development/Traffic Engineering Full-Time Salaries Account No. 1012208-5111 to offset a previous transfer of salaries to contract services.

With the approval of the Mid-Year Budget Review's Proposed Budget Adjustments,the General Fund's Fiscal Year 2024-25 estimated expenditures and transfers out will increase by $490,011 for a total budgeted expenditure and transfer out total of$62,320,154.

In addition to recommended budget adjustments in the General Fund, there are also proposed adjustments to other funds at this time. The following details the recommended budget adjustments in other funds.

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Housing Fund(201)

1. Transfer Out$7,678 from Housing Fund Account No.2010000-5070 to the 115 Trust Account No.8100000- 4970 for the Fund's proportionate share of the OPEB costs for Fiscal Years 2021-22—2022-23.

2. Appropriate $3,699 from Housing Fund Account No. 2012931-5706 and adjust expenses by offsetting revenue in the UAL&Employee Benefits Account No.7550000-4680 for the Fund's proportionate share of the OPEB costs for Fiscal Year 2023-24. Payment to be released in Fiscal Year 2024-25.

CARES Act(226)

1. Transfer Out of$30,067 to the General Fund for a residual equity cleanup.

Fleet Management Internal Service Fund(752)

1. $43,755 to Street Maintenance Vehicles Account No. 7525401-5531 for the purchase and outfitting of a vehicle for the Public Works Operations Supervisor.

2. $50,000 to Fleet Maintenance Contract Services Account No. 7525414-5253 for vehicle maintenance and repair services due to staffing shortages.

3. $7,000 to Fleet Maintenance Training Account No. 7525414-5215 for Class A licenses for new employees.

Information Systems Internal Service Fund(753)

1. $50,000 to Information Technology Computer Equipment Account No. 7531401-5232 to purchase printers for all police vehicles.

2. $12,000 to Information Technology Other Equipment (under $5,000) Account No. 7531401-5233 to purchase iPads for the Police Department detectives.

3. $35,000 to Information Technology Software Subscriptions Account No. 7531401-5239 for the Tyler subscription costs of the time and attendance module.

4. $8,000 to Information Technology Software Subscriptions Account No. 7531401-5239 for the NeoGov subscription costs of the onboarding module.

5. $10,500 to Information Technology Software Subscriptions Account No. 7531401-5239 for the Cellebrite subscription costs of the Inseyets Online Pro to support public safety.

6. $10,000 to Information Technology Data Processing Services Account No. 7531401-5254 for implementation of the Nobel homeless module.

7. $10,000 to Information Technology Data Processing Services Account No. 7531401-5254 for customized Energov reports.

8. $10,000 to Information Technology Data Processing Services Account No. 7534205-5254 to create additional workstations with necessary equipment at the Senior Center.

Building Maintenance and Operations Internal Service Fund(754)

1. $18,000 to Building Maintenance Improvements Other Than Buildings Account No. 7545602-5528 for the purchase of storage sheds at Landecena Community Center.

2. $14,300 to Building Maintenance Buildings/Structures/Grounds Account No. 7545602-5245 for water restoration services on the first floor at the Library.

3. $10,000 to Building Maintenance Improvements Account No. 7545602-5529 for mold remediation at the City Hall parking lot kiosk building.

4. $4,200 to Building Maintenance Professional Services Account No. 7545602-5245 for drywall repairs at the Police Department Records Office.

Water Utility Fund(640)

1. Transfer Out of$54,700 from Water Utility Account No. 6400000-5070 to the 115 Trust Account No. 8100000-4970 for the Fund's proportionate share of the OPEB costs for Fiscal Years 2021-22—2022-23.

2. $10,000 to Solid Waste WECWC Management Control Professional Services Account No. 6406207-5252 for contract costs associated with project management.

3. $135,000 to Water Administration Professional Services Account No. 6406201-5252 for contract costs associated with Operations Management Group,Interim Utilities Manager and Project Manager.

4. $22,900 to Water Production/Storage Contract Services Account No. 6406205-5253 for Geographic Information Systems staffing.

5. $33,800 to Water Production/Storage Maintenance-Other Account No. 6406205-5248 for increased costs associated with the improved control valve maintenance schedule.

6. $6,700 to Water Production/Storage Software Subscriptions Account No. 6406205-5239 for the one-time purchase cost of the Nobel module.

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7. $20,000 to Water Production/Storage Professional Services Account No.6406205-5252 for the seismic study which is required every five years per the California Accidental Release Prevention program.

8. $60,750 to Water Transmission and Distribution Vehicles Account No. 6406206-5531 for increased cost of replacement of the hydro vacuum truck.

9. $22,900 to Water Transmission and Distribution Contract Services Account No. 6406206-5253 for Geographic Information Systems staffing.

10. $3,000 to Water WECWC Management Control Professional Services Account No. 6406207-5252 for contract costs associated with Operations Management Group.

11. $600 to Water Cross Connection Training Account No. 6406215-5215 for costs associated with attendance of a conference.

12. $600 to Water Cross Connection Uniform Account No. 6406215-5218 for employee uniform costs.

13. Appropriate $26,347 from Water Utility Fund Account No. 6406201-5706 and adjust expense by offsetting revenue in the UAL&Employee Benefits Account No.7550000-4680 for the Fund's proportionate share of the OPEB costs for Fiscal Year 2023-24.Payment to be released in Fiscal Year 2024-25.

Solid Waste Fund(641)

1. Transfer Out of$5,736 from the Solid Waste Fund Account No.6410000-5070 to the 115 Trust Account No. 8100000-4970 for the Fund's proportionate share of the OPEB costs for Fiscal Years 2021-22—2022-23.

2. $70,000 to Solid Waste Administration Professional Services Account No. 6416301-5252 for contract costs associated with project management.

3. $23,000 to Solid Waste Administration Professional Services Account No. 6416301-5252 for contract costs associated with Operations Management Group.

4. Appropriate$2,763 from the Solid Waste Fund Account No. 6416301-5706 and adjust expense by offsetting revenue to the UAL&Employee Benefits Account No.7550000-4680 for the Fund's proportionate share of the OPEB costs for Fiscal Year 2023-24. Payment to be released in Fiscal Year 2024-25.

Sewer Utility Fund(645)

1. Transfer Out of$20,365 from the Sewer Fund Account No. 6450000-5070 to the 115 Trust Account No. 8100000-4970 for the Fund's proportionate share of the OPEB costs for Fiscal Years 2021-22—2022-23.

2. $70,000 to Sewer Administration Professional Services Account No. 6456401-5252 for contract costs associated with project management.

3. $108,000 to Sewer Maintenance and Operations Professional Services Account No. 6456402-5252 for contract costs associated with Operations Management Group, Interim Utilities Manager and Project Manager.

4. $47,000 to Sewer Maintenance and Operations Contract Services Account No.6456402-5253 for Geographic Information Systems staffing.

5. $6,200 to Sewer Landfill Maintenance Other Equipment Account No.6456404-5233 for a digital fog probe.

6. Appropriate $9,809 from the Sewer Fund Account No. 6456402-5706 and adjust expense by offsetting revenue to the UAL&Employee Benefits Account No.7550000-4680 for the Fund's proportionate share of the OPEB costs for Fiscal Year 2023-24.Payment to be released in Fiscal Year 2024-25.

Fiscal Year 2024-25 Personnel Changes
Attachment 2 identifies proposed changes to the Schedule of Positions.

1. Unfreeze one vacant Police Dispatcher I/II position.

2. Reclassify the Public Works Director position to an Assistant City Manager responsible for the Public Works Department.

3. Modification to the salary splits for five (5) Public Works engineer positions who primarily allocate their time to capital projects, and in turn overcharge the General Fund with their current budgeted salary distribution.The modified salary splits more than offset the increased costs associated with#2 above.

Attachment 3 identifies the fiscal impact related to the proposed personnel changes.

Capital Assets
Upland's current capital assets depreciation limit is$5,000,which has been in place and remained static for decades.

Staff recommend that City Council raise the depreciation threshold to$10,000 to improve financial efficiency,reduce an administrative burden,and align with inflation and industry standards. A higher threshold allows Upland to focus depreciation tracking on more significant long-term assets and reduce costs associated with managing numerous lower-value items. Increasing the threshold reflects the rising costs of capital assets over time, ensuring financial reporting remains relevant and effective.

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Upland City CouncilMarch 10, 2025

Upland City Council
March 10, 2025