Upland City Council
June 22, 2026

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MEETING OF THE CITY COUNCIL
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Bill Velto,Mayor
Shannan Maust, Mayor Pro Tem-District 1 Michael Blay,City Manager James Breitling,Councilmember-District 2 Thomas Rice,City Attorney Carlos A. Garcia.Councilmember-District 3 Keri Johnson, City Clerk Rudy Zuniga, Couneilrnember -District 4
Monday, June 22, 2026
Open session begins at 6:00 p.m.

Carnegie Library Building
123 East D Street
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 REAL PROPERTY NEGOTIATORS California Government Code Section 54956.8
Property: Approximately 614 square feet of area within Memorial Park located in the City of Upland (APN: 1046-183-01)
City Negotiators: City Manager, Development Services Director, and Economic Development Coordinator
Negotiating Party: Crown Castle

Under Negotiation: Price and Terms
b. CLOSED SESSION CONFERENCE WITH LEGAL COUNSEL - EXISTING

LITIGATION
Pursuant to Government Code Section 54956.9(d)(1)
Case Name: Kaufman, William v. City of Upland, San Bernardino County Superior Court of California
Case Number: CIVSB2405182

5. INVOCATION
Very Reverend Keith Yamamoto, St. Marks Episcopal Church

6. PLEDGE OF ALLEGIANCE

7. PRESENTATIONS
Proclamation Recognizing Captain Cliff Mathews upon his Retirement with 35 years of Service to the City.

Recognition of Upland Police Department Baker to Vegas Team Proclamation declaring July as Parks Make Life Better Month, accepted by Recreation and Community Services

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 9
Recommended Action:

Approve the Regular Meeting Minutes of June 8, 2026. (Staff Person: Keri Johnson)
b. DESIGNATION OF VOTING DELEGATE FOR THE ANNUAL LEAGUE OF 17

CALIFORNIA CITIES CONFERENCE
CEQA: Not a Project.

Recommended Action:

Appoint Mayor Velto as the voting delegate and Councilmember Breitling as the alternate voting delegate to represent the City of Upland at the League of California Cities General Assembly Meeting on September 25, 2026. (Staff Person: Keri Johnson)
c. CONSIDER APPROVAL OF MAY WARRANT AND PAYROLL REGISTERS 22 CEQA: Not a Project.

Recommended Action:

Approve the May warrant registers totaling $13,338,983.74 (check numbers 57146 — 57481 and direct disbursements) and payroll registers totaling $2,098,528 (check numbers 164655 — 164672 and electronic fund transfers 62722 — 63308). (Staff Person: Stephen Parker)
d. CONSIDER APPROVAL OF THE SECOND AMENDMENT TO THE 34

AGREEMENT WITH HDL COMPANIES FOR CONTRACT BUSINESS LICENSE

SERVICES
CEQA: Not a Project.

Recommended Action:

Approve the Second Amendment to the Agreement with HdL Companies for contract business license services for one additional year through June 30, 2027, in an amount not-to-exceed $150,000 for the extension period; and authorize the City Manager to execute the Second Amendment. (Staff Person: Stephen Parker) e. CONSIDER APPROVAL OF THE FIRST AMENDMENT TO THE AGREEMENT 86

WITH VAN LANT & FANKHANEL, LLP FOR PROFESSIONAL AUDITING

SERVICES
CEQA: Not a Project.

Recommended Action:

Approve the First Amendment to the Agreement with Van Lant & Fankhanel, LLP for professional auditing services for one additional year through June 30, 2027,

covering the Fiscal Year 2025-26 audit, in an amount not-to-exceed $41,000 for the extension period; and authorize the City Manager to execute the First Amendment. (Staff Person: Stephen Parker)
f. TREASURER'S REPORT MAY 2026 129
CEQA: Not a Project.

Recommended Action:

Receive and file the May 2026 Treasurer's Report. (Staff Person: Stephen Parker)
g. CONSIDER ADOPTING AMENDMENT NO. 1 TO THE MEMORANDUM OF 146

UNDERSTANDING BETWEEN THE CITY OF UPLAND AND AFSCME, LOCAL 20 CEQA: Not a Project.

Recommended Action:

Adopt a Resolution approving Amendment No. 1 to the Memorandum of Understanding (MOU) between the City of Upland and AFSCME, Local 20. (Staff Person: Stephen Parker)
h. CONSIDER CHANGE ORDER APPROVAL FOR A PURCHASE ORDER WITH 325

KNIGHT DODGE OF CLAREMONT
CEQA: Not a Project.

Recommended Action:

Approve a change order in the amount of $15,000 to an existing purchase order with Knight Dodge of Claremont for a total revised purchase order amount of $65,000; and authorize the City Manager to execute all necessary documents. (Staff Person: Damien Arrula)
i. CONSIDER CHANGE ORDER APPROVAL FOR A PURCHASE ORDER WITH 329

GREEN'S AUTO TECH
CEQA: Not a Project.

Recommended Action:

Approve a change order in the amount of $15,000 to an existing purchase order with Green's Auto Tech for a total revised purchase order amount of$65,000; and authorize the City Manager to execute all necessary documents. (Staff Person:

Damien Arrula)
j. CONSIDER APPROVAL OF FIRST AMENDMENT TO THE GUARANTEED 333 JANITORIAL SERVICES, INC. AGREEMENT FOR JANITORIAL SERVICES CEQA: Not a project.

Recommended Action:

Approve the First Amendment to the Guaranteed Janitorial Services, Inc. agreement in the amount of $95,000 for one additional year extending the agreement through June 30, 2027; and authorize the City Manager to execute the amendment. (Staff Person: Damien Arrula)
k. EMERGENCY REPAIR WORK FOR 26 W. 15TH STREET TRANSFER 359

STATION UPDATE
CEQA: Not a Project.

Recommended Action:

Receive and file the status update related to the KSM Electric, Inc. contract for emergency repair work at the 26 W. 15th Street Transfer Station. (Staff Person:

Damien Arrula)
I. CONSIDER APPROVAL OF A GENERAL SERVICES AGREEMENT WITH 360 GRAFFITI PROTECTIVE COATINGS, INC., FOR GRAFFITI REMOVAL SERVICES.

CEQA: Not a project.

Recommended Action:

Approve a General Services Agreement with Graffiti Protective Coatings, Inc. for Graffiti Removal Services for an initial term of three (3) years in the amount of $89,760 annually with the option to extend for four (4) additional one-year terms at the sole direction of the City; and authorize the City Manager to execute the Agreement. (Staff Person: Damien Arrula)
m. CONSIDER APPROVAL OF FIRST AMENDMENT TO THE MAINTENANCE 380 SERVICES AGREEMENT WITH T.S.R. CONSTRUCTION & INSPECTION, INC.

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

Recommended Action:

Approve a First Amendment to the Maintenance Services Agreement with T.S.R.

Construction & Inspection, Inc., to extend the term for an additional one-year period through June 30, 2027, in an amount not to exceed $300,000 for On-Call Pavement Repair Services; and authorize the City Manager to execute the amendment. (Staff Person: Damien Arrula)
n. CONSIDER APPROVAL OF A CHANGE ORDER FOR CABRILLO SAFETY 416

NETTING PROJECT AND ADDITIONAL APPROPRIATION OF QUIMBY FUNDS

FOR THE PROJECT
CEQA: Not a Project.

Recommended Action:

Approve a Change Order with West Coast Netting in the amount of $35,706.25 for an agreement total of $90,206.25, authorize an additional appropriation of $37,214.52 in Quimby Fee funds for a revised project total of $97,214.52; and authorize the City Manager to execute the change order. (Staff Person: Damien Arrula)
o. CONSIDER APPROVAL OF FIRST AMENDMENT TO THE MAINTENANCE 450 SERVICES AGREEMENT WITH HARDY & HARPER, INC.

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

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

Recommended Action:

Approve a First Amendment to the Maintenance Services Agreement with Hardy & Harper, Inc., to extend the term for an additional one-year period, through June 30, 2027, for On-Call Asphalt Pavement Repair Services; and authorize the City Manager to execute the amendment. (Staff Person: Damien Arrula) p. CONSIDER PURCHASE APPROVAL OF THREE CHEVROLET EQUINOX 482

ELECTRIC VEHICLES FROM NATIONAL AUTO FLEET GROUP
CEQA: Not a Project.

Recommended Action:

Approve the purchase of three (3) 2026 Chevrolet Equinox electric vehicles (EVs) with National Auto Fleet Group of Watsonville, California for a total amount of $117,018.56; and authorize the City Manager to execute all necessary documents for the purchase of the vehicles. (Staff Person: Damien Arrula) q. CONSIDER APPROVING THE PURCHASE OF A COMPUTER AIDED 534

DISPATCH AND RECORDS MANAGEMENT SYSTEM FOR THE POLICE

DEPARTMENT
CEQA: Not a Project.

Recommended Action:

Approve the Software and Services Agreement with Sun Ridge Systems, Inc. in an amount not to exceed $1,420,393 over five (5) years; authorize the City Manager, subject to City Attorney review, to approve non-substantive modifications without increasing the City's financial obligations or liability; appropriate $500,000 from the available unreserved COPS Fund Balance to the COPS Data Processing Center Account No. 2163201-5254; and authorize the City Manager to execute the Agreement and any documents necessary to implement the project. (Staff Person: Marcelo Blanco)
r. CONSIDER ADOPTING A RESOLUTION ESTABLISHING RESIDENTIAL 560

PERMIT PARKING ON GENOA WAY
CEQA: Not a Project.

Recommended Action:

Adopt a Resolution establishing residential permit parking on Genoa Way, between W 8th Street and its northerly terminus; and authorize its implementation. (Staff Person: Robert Dalquest)
s. CONSIDER APPROVAL OF A THIRD AMENDMENT TO THE PROFESSIONAL 564 SERVICES AGREEMENT WITH HR GREEN PACIFIC, INC.

CEQA: Not a Project.

Recommended Action:

Approve the Third Amendment to the Professional Services Agreement with HR Green Pacific, Inc. to extend the contract term by one year to June 30, 2027, with an annual compensation of $60,000 for Fiscal Year 2026-27; and authorize the City Manager to execute the agreement. (Staff Person: Robert Dalquest) t. CONSIDER APPROVAL OF A THIRD AMENDMENT TO THE PROFESSIONAL 597 SERVICES AGREEMENT WITH TRANSTECH ENGINEERS, INC.

CEQA: Not a Project.

Recommended Action:

Approve Amendment No. 3 to the agreement with TransTech Engineers, Inc., extending the contract an additional year with an annual compensation of $60,000 for Fiscal Year 2026-27; and authorize the City Manager to execute the amendment. (Staff Person: Robert Dalquest)
u. CONSIDER APPROVAL OF PROFESSIONAL SERVICES AGREEMENT WITH 630

WILLDAN ENGINEERING
CEQA: Not a Project.

Recommended Action:

Approve a Professional Services Agreement with Willdan Engineering for Building Division staff augmentation in an amount not to exceed $112,000 for a term ending March 31 , 2027; and authorize the City Manager to execute the Agreement. (Staff Person: Robert Dalquest)
v. CONSIDER APPROVAL OF PROFESSIONAL SERVICES AGREEMENT WITH 647

CIR, INC
CEQA: Not a Project.

Recommended Action:

Approve a Professional Services Agreement with CIR, Inc. for Building and Safety Division staff augmentation services in an amount not to exceed $205,000 for a term ending March 31, 2027; and authorize the City Manager to execute the Agreement. (Staff Person: Robert Dalquest)

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. CONSIDER APPROVAL OF SIXTH AMENDMENT TO THE CITY MANAGER 667

EMPLOYMENT AGREEMENT
CEQA: Not a Project.

Recommended Action:

Approve the Sixth Amendment to the City of Upland City Manager Employment Agreement with Michael Blay, providing him with a 3% COLA, consistent with City Council-approved amendments to the Executive Management Compensation and Benefit Plan. (Staff Person: Thomas Rice)
b. CONSIDERATION OF A PROPOSED DEDICATION PLAQUE AND TEXT 670

WITHIN THE TOM THOMAS MAGNOLIA PLAZA LOCATED ON SECOND

AVENUE IN DOWNTOWN UPLAND

CEQA: Not a Project.

Recommended Action:

Approve the Dedication Plaque and text within the Tom Thomas Magnolia Plaza located on the southerly support column of the Plaza's gateway on Second Avenue in Downtown Upland. (Staff Person: Robert Dalquest)

14. COUNCIL COMMUNICATIONS

15. CITY MANAGER

16. ADJOURNMENT
The next regularly scheduled City Council meeting is Monday, July 13, 2026.

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 June 17, 2026 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 June 8, 2026
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 (arrived at 6:00 p.m.), Councilmember Shannan Maust, Councilmember Rudy Zuniga
Staff Present: City Manager Michael Blay, City Clerk Keri Johnson, City Attorney Thomas Rice

1. CALL TO ORDER AND ROLL CALL
The regular meeting of the Upland City Council was called to order by Mayor Bill Velto at 5:00 p.m. in the Council Chamber of the Upland City Hall.

Moved by: Councilmember Zuniga
Seconded by: Councilmember Breitling
Excuse the absence of Councilmember Garcia.

Motion: Carried Unanimously with Councilmember Garcia absent

2. ADDITIONS-DELETIONS TO AGENDA
None.

3. ORAL COMMUNICATIONS
None.

CLOSED SESSION - 5:00 p.m.

4. CLOSED SESSION
At 5:01 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
i. Solorzano et al. v. City of Upland, San Bernardino County Superior Court of California, Case No. CIVSB2207375
ii. Camilleri, Linda v. City of Upland, San Bernardino County Superior Court of California, Case No. CIVRS2400123
iii. Cano, Ronnie Fred v. City of Upland, San Bernardino County Superior Court of California, Case No. CIVRS2401301
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iv. Espinoza et al. v. City of Upland, San Bernardino County Superior Court of California, Case No. CIVRS2506382
v. Corona, Kiana v. City of Upland, United States District Court for the Central District of California, Case No. 5:25-cv-03458-GW vi. Guerrero, Priscilla v. Upland Unified School District et al., San Bernardino County Superior Court of California, Case No. CIVRS2501001 vii. Laureano, Benny v. City of Upland, San Bernardino County Superior Court of California, Case No. CIVSB2317284
viii. Lopez, Ignacio v. City of Upland, San Bernardino County Superior Court of California, Case No. CIVRS2400981
ix. Teixeira, Carlos v. City of Upland et al., San Bernardino County Superior Court of California, Case No. CIVRS2505576
x. Kaufman Jr., William Paul v. City of Upland, San Bernardino County Superior Court of California, Case No. CIVSB2405182
xi. Quinones et al. v. City of Upland et al., San Bernardino County Superior Court of California, Case No. CIVRS2600375
xii. Hemenway, Robert v. City of Upland, San Bernardino County Superior Court of California, Case No. CIVRS2506419
xiii. Lopez, Donna v. City of Upland et al., San Bernardino County Superior Court of California, Case No. CIVRS2600376
xiv.McDonald, Maggie v County of San Bernardino et al., San Bernardino County Superior Court of California, Case No. CIVRS2504306 xv. Neale, Michelle v. City of Upland, San Bernardino County Superior Court of California, Case No. CIVRS2401627
xvi.Sheridan, Janice v City of Upland, San Bernardino County Superior Court of California, Case No. CIVRS2510715
xvii. Doe, John v City of Upland et al., San Bernardino County Superior Court of California, Case No. CIVSB2220905
xviii. Thompson, Michael v. City of Upland et al., San Bernardino County Superior Court of California, Case No. CIVRS2501700 xix. Ramos, Keri v. City of Upland, United States District Court for the Central District of California, Case No. 5:25-cv-01820-KK-SSC
xx. Silva et al. v. City of Rancho Cucamonga et al., San Bernardino County Superior Court of California, Case No. CIVRS2505275
xxi.Clay, Nathanael Douglass v. City of Upland, United States District Court for the Central District of California, Case No. 5:26-cv-00068-MWC-MBK xxii. Fuentez, Gabriel v. City of Upland, United States District Court for the Central District of California, Case No. 5:25-cv-02915-KK (DTBx) 2

xxiii. Stokes, Douglas v. City of Upland, United States District Court for the Central District of California, Case No. 5:25-cv-03480-MWF-BFM xxiv. Gilmour, Jeffrey v. City of Upland, United States District Court for the Central District of California, Case No. 25-cv-00967 xxv. Presley, Amunique v. City of Upland, San Bernardino County Superior Court of California, Case No. CIVRS2601691
The City Council reconvened in open session at 6:02 p.m.

5. INVOCATION
Mike Ingram, Christian Science Faith

6. PLEDGE OF ALLEGIANCE
Led by Jim Thomas

7. PRESENTATIONS

8. CITY ATTORNEY
City Attorney Rice announced the City Council received reports on Closed Session Item 4a and there was no reportable action.

9. ORAL COMMUNICATIONS
Steve Crest, Upland, stated that he has concerns about the intersection at Euclid and 17th Street because a tree blocks the view of southbound traffic on Euclid.

Rob Perhamus, Upland, provided information about his Makers Space.

Sophia Cohen, Field Representative for Assemblymember Michelle Rodriguez, announced an upcoming summer BBQ event.

Natasha Walton, Upland, requested that the Council refrain from deferring park revenues to the General Fund for the next two years.

Osvaldo Leo Diaz, Rancho Cucamonga, provided information about an upcoming comedy show.

10. CONSENT CALENDAR
Mayor Velto removed Consent Calendar Item 10e and 10g and Councilmember Garcia removed 10h for separate action.

Moved by: Councilmember Breitling
Seconded by: Councilmember Garcia
Approve the Consent Calendar
Motion: Carried Unanimously
a. APPROVAL OF MINUTES
Approve the Regular Meeting Minutes of May 26, 2026 and the Special Meeting Minutes of June 1, 2026.
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b. ADOPTION OF ORDINANCE NO. 2011
Adopt Ordinance No. 2011 adopting Specific Plan Amendment No. 25-0003 (Amendment No. 4) to the Historic Downtown Upland Specific Plan as shown in Exhibits A, B and C to the Ordinance.
c. ADOPTION OF ORDINANCE NO. 2012 AMENDING UPLAND MUNICIPAL CODE CHAPTER 2.04 REGARDING POWERS AND DUTIES OF THE CITY

MANAGER
Adopt Ordinance No. 2012 amending Chapter 2.04 of the Upland Municipal Code as follows: 1) amending Section 2.04.070 subsection C and 2) adding Section

2.04.070 subsection D.
d. CONSIDER RATIFICATION OF APPOINTMENTS TO LIBRARY BOARD OF

TRUSTEES
Ratify the Mayor's appointment of Owen Egger and Jesse Juarez to the Library Board of Trustees, terms expire June 30, 2029.
f. BIENNIAL REVIEW OF CONFLICT OF INTEREST CODE
Direct staff to review the code and submit notice that either an amendment is required or no amendment is necessary.

CONSIDERATION OF A CASH IN LIEU AGREEMENT FOR

UNDERGROUNDING AND PUBLIC IMPROVEMENTS FOR PARCEL MAP
20819
Adopt Resolution No. 6885 approving a cash in lieu agreement for undergrounding and public improvements as provided in Conditions 30.7 through

30.13 and 30.21 of Tentative Parcel Map No. 20819 and Development Plan Review No. 24-05 concerning the creation of two out-parcels in the Mountain Green Commercial Center located at 233 S. Mountain Avenue; and authorize the City Manager to execute the cash-in lieu agreement.
j. CONSIDER APPROVAL OF PARCEL MAP 20819 AND SUBDIVISION

AGREEMENT FOR THE MOUNTAIN GREEN CENTER ON MOUNTAIN AVE, SOUTH OF 8TH STREET
Approve Parcel Map 20819 for recordation; and authorize the City Manager to sign the subdivision agreement.
k. EMERGENCY REPAIR WORK FOR 26 W. 15TH STREET TRANSFER

STATION UPDATE
Receive and file the status update related to the KSM Electric, Inc. contract for emergency repair work at the 26 W. 15th Street Transfer Station.

CONSIDER ACCEPTANCE OF HOMELAND SECURITY GRANT PROGRAM
2024 FUNDS
Accept the City's share of the 2024 Homeland Security Grant Program award in the amount of $28,832, appropriate the grant funds to Fund 214; and authorize the City Manager to execute any and all documents necessary to implement the grant.
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e. CONSIDER RATIFICATION OF AN APPOINTMENT AND REAPPOINTMENT TO

THE PLANNING COMMISSION
Mayor Velto commented on the interview process for the Planning Commission.

Michael Couper introduced himself and thanked Council.

Moved by: Councilmember Maust
Seconded by: Councilmember Zuniga
Ratify the Mayor's appointment of Michael Couper and the reappointment of Brian Staton to the Planning Commission, terms ending June 30, 2030.

Motion: Carried Unanimously
g. ACCEPT THE RESIGNATION OF CITY COUNCIL ADVISORY COMMITTEE MEMBER
Council thanked Ms. Marroquin for her service on the Committee.

Moved by: Councilmember Maust
Seconded by: Councilmember Zuniga
Accept the resignation from City Council Advisory Committee Member Monica Marroquin and direct the City Clerk to post the notice of unscheduled vacancy.

Motion: Carried Unanimously
h. FISCAL YEAR 2025-26 COST ALLOCATION PLAN, UPDATED SOLID WASTE

COST ALLOCATION AND UPDATED ALLOCATION METHODOLOGY FOR

SELF-FUNDED LIABILITY
Assistant City Manager Parker answered questions from the Council regarding the cost allocation and updated methodology.

Moved by: Councilmember Maust
Seconded by: Councilmember Garcia
Receive and file an update on the Fiscal Year 2025-26 Cost Allocation Plan; 2) receive and file an update on the allocated costs for additional services under the Amended and Restated Agreement with Burrtec Waste Industries, Inc; 3) approve a budget amendment from the Solid Waste Utility Reserve Fund balance in the amount of $225,000 to cover the reallocation of costs related to pressure washing and porter services; 4) receive and file an update on the proposed allocation methodology for the City's Self-Funded Liability Internal Service Fund; and 5) approve the General Fund savings realized by the updated allocation methodology for the Self-Funded Liability Insurance Fund from Fiscal Years 2023-24, 2024-25, and 2025-26 to be applied towards the budget deficit in Fiscal Years 2026-27 and 2027-28.

Motion: Carried Unanimously
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11. PUBLIC HEARINGS
a. CONDUCT A PUBLIC HEARING AND CONSIDER ADOPTION OF WATER,

RECYCLED WATER, AND SEWER RATE ADJUSTMENTS AND RELATED

FINDINGS
City Clerk Johnson called for speakers that wished to speak regarding the Resolution adopting findings and determinations regarding legal objections to proposed water and sewer rates.

Rob Perhamus, thanked the City.

Moved by: Councilmember Maust
Seconded by: Councilmember Breitling
Adopt Resolution No. 6886 making certain findings and determinations regarding legal objections to proposed water and sewer rates.

Motion: Carried Unanimously
Mayor Velto opened the public hearing.

Assistant City Manager Arrula provided information on the proposed water rate increases along with a PowerPoint presentation.

Consultant Sudhir Pardiwala with Raftelis presented information on the water, recycled water, and sewer rate study that was conducted by Raftelis.

There was discussion regarding IEUA pass through fees.

Glenn Bozar, stated that, as a majority shareholder in San Antonio Water Company and West End Water Company, the City should not compare the City's rates to other agency rates. He then compared the proposed rates to those reflected on a water bill from ten years ago.

Blanca M., stated concerns about residents being asked to absorb additional rate increases amid rising household expenses and questioned the consideration of rate increases over a five-year period.

Joseph A. Mitchell, Upland, stated that it is becoming increasingly difficult for senior citizens to afford living in the City and urged the Council to consider the challenges faced by residents on fixed incomes in absorbing additional cost increases.

Hearing no further testimony, Mayor Velto closed the public hearing.

City Clerk Johnson announced that at the close of the public hearing a majority protest to the proposed water, recycled water, and sewer rates did not exist.

Assistant City Manager Arrula answered questions from the Council regarding the required maintenance and repairs to infrastructure, IEUA pass through fees, drought rates, funding for the reservoir at 17th and Benson, valve and hydrant testing throughout the City, PFAS, and the use of water reserves to address infrastructure needs.
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Moved by: Councilmember Breitling
Seconded by: Councilmember Maust
Approve Resolution No. 6887 making certain findings under the California Environmental Quality Act and adopting the rate schedules and related adjustments as recommended by staff.

Motion: Carried with Councilmembers Garcia and Zuniga opposed At 8:14 p.m. Mayor Velto called a recess and the City Council reconvened in open session at 8:27 p.m.

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

CONFERENCE ATTENDANCE
Mayor Velto reported on his attendance at the IEUA board meeting.

13. BUSINESS ITEMS
a. CONSIDER APPROVAL OF THE FISCAL YEAR 2026-27 —2027-28 BIENNIAL

BUDGET AND RELATED ACTIONS
City Manager Parker provided an overview of the budget preparation process and introduced Finance Manager Sullivan who presented the proposed budget along with a PowerPoint presentation.

Assistant City Manager Arrula responded to questions from the Council regarding filling vacant positions, the master plans that have been prepared for the City, and park lease revenues.

There was discussion regarding the proposed discretionary funds for City Council and Council proposed removing the discretionary funds from the two year budget.

Moved by: Councilmember Garcia
Seconded by: Councilmember Maust

1. Approve Resolution No. 6888 adopting the Fiscal Year 2026-27 — 2027- 28 biennial budget, with the removal of the $125,000 per fiscal year allocation for the City Council Discretionary Fund.;

2. Adopt Resolution No. 6889 approving the General Fund Reserve Policy;

3. Adopt Resolution No. 6890 approving the appropriations limit for Fiscal Year 2026-27;

4. Adopt Resolution No. 6891 placing a two-year pause on the Park Lease Revenue designation established by Resolution No. 6713;

5. Approve the updated Schedule of Positions;

6. Approve amending the City's Classification Plan to include the Deputy Finance Director, Principal Human Resources/Risk Management Analyst, 7

Principal Planner, and Principal Economic Development Coordinator job descriptions;

7. Approve the updated salary schedules for Executives and Non- Rep/Confidential.

Motion: Carried Unanimously

14. COUNCIL COMMUNICATIONS
Councilmembers announced various activities and events throughout the community.

15. CITY MANAGER

16. ADJOURNMENT
Mayor Velto adjourned the meeting at 9:24 p.m. The next regularly scheduled City Council meeting is Monday, June 22, 2026.

Keri Johnson, City Clerk
8

:,' Up`q� CITYUPLAND
, �` "The City of Gracious Living"
DATE: June 22,2026
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:KERI JOHNSON,CITY CLERK

JENNIFER RODRIGUEZ,DEPUTY CITY CLERK
SUBJECT: DESIGNATION OF VOTING DELEGATE FOR THE ANNUAL LEAGUE OF CALIFORNIA

CITIES CONFERENCE
RECOMMENDED ACTION:

It is recommended that the City Council appoint Mayor Velto as the voting delegate and Councilmember Breitling as the alternate voting delegate to represent the City of Upland at the League of California Cities General Assembly Meeting on September 25,2026.

GOAL STATEMENT
The proposed action supports the City's goal of participating in activities that develop policies for California cities.

BACKGROUND
The League of California Cities "League" will hold its Annual Conference from September 23-25, 2026, at the Anaheim Convention Center. The Conference was created to enable cities to share ideas, success stories, best practices,and provide discussion forums pertaining to various areas of municipal interest.

ISSUES AND ANALYSIS
The Conference includes a General Assembly meeting where voting delegates, on behalf of their designated cities, cast votes on conference resolutions. These resolutions establish League policy to guide cities and the League in its efforts to improve the quality, responsiveness, and vitality of local government in California. The League's bylaws state each member city is entitled to one vote on matters affecting the League or municipal policy;and a City's voting delegate and alternate voting delegate must be designated by the City Council.

The City's vote will be cast at the League of California Cities General Assembly Meeting on September 25, 2026.

Mayor Velto and Councilmember Breitling are registered for the conference.

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.

Iliik LEAGUE OF

CALIFORNIA
CITIES
Council Action Advised by September 1, 2026
DATE: Wednesday, May 13, 2026
TO: Mayors, Council Members, City Clerks, and City Managers RE: DESIGNATION OF VOTING DELEGATES AND ALTERNATES League of California Cities Annual Conference and Expo, Sept. 23-25, 2026 Anaheim Convention Center
Every year, the League of California Cities convenes a member-driven General Assembly at the Cal Cities Annual Conference and Expo. The General Assembly is an important opportunity where city officials can directly participate in the development of Cal Cities policy.

Taking place on Friday, Sept. 25, 2026 the General Assembly is comprised of voting delegates appointed by each member city; every city has one voting delegate. Your appointed voting delegate plays an important role during the General Assembly by representing your city and voting on resolutions.

To cast a vote during the General Assembly, your city must designate a voting delegate and up to two alternate voting delegates, one of whom may vote if the designated voting delegate is unable to serve in that capacity. Voting delegates may either be an elected or appointed official.

Action by Council Required. Consistent with Cal Cities bylaws, a city's voting delegate and up to two alternates must be designated by the city council. Please note that designating the voting delegate and alternates must be done by city council action and cannot be accomplished by individual action of the mayor or city manager alone.

Following council action, please submit your city's delegates through the online submission portal by Tuesday, Sept. 1, 2026. When completing the Voting Delegate submission form, you will be asked to attest that council action was taken. You will need to be signed in to your My Cal Cities account when submitting the form.

Submitting your voting delegate form by the deadline will allow us time to establish voting delegate/alternate records prior to the conference and provide pre-conference communications with voting delegates.

Conference Registration Required. The voting delegate and alternates must be registered to attend the conference. They need not register for the entire conference; they may register for Friday only. Conference registration opens June 2.

For a city to cast a vote, one voter must be present at the General Assembly and in possession of the voting delegate card and voting tool. Voting delegates and 1400 K Street, Suite 400, Sacramento, CA 95814 • 916.658.8200 • calcities.org

LEAGUE OF

CALIFORNIA
CITIES
alternates need to pick up their conference badges before signing in and picking up the voting delegate card at the voting delegate desk. This will enable them to receive the special sticker on their name badges that will admit the voting delegate into the voting area during the General Assembly.

Please view Cal Cities' event and meeting policy in advance of the conference.

Transferring Voting Card to Non-Designated Individuals Not Allowed. The voting delegate card may be transferred freely between the voting delegate and alternates, but only between the voting delegate and alternates. If the voting delegate and alternates find themselves unable to attend the General Assembly, they may not transfer the voting card to another city official.

Seating Protocol during General Assembly. At the General Assembly, individuals with a voting card will sit in a designated area. Admission to the voting area will be limited to the individual in possession of the voting card and with a special sticker on their name badge identifying them as a voting delegate.

The voting delegate desk, located in the conference registration area of the Long Beach Convention Center in Long Beach, will be open at the following times: Wednesday, Sept. 23, 8:00 a.m.-6:00 p.m. and Thursday, Sept. 24, 7:30 a.m.-4:00 p.m. On Friday, Sept. 25, the voting delegate desk will be open at the General Assembly, starting at 7:30 a.m., but will be closed during roll calls and voting.

The voting procedures that will be used at the conference are attached to this memo.

Please share these procedures and this memo with your council and especially with the individuals that your council designates as your city's voting delegate and alternates.

Once again, thank you for submitting your voting delegate and alternates by Tuesday, Sept. 1. If you have questions, please contact Zach Seals at [email protected].

Attachments:
• General Assembly Voting Guidelines
• Information Sheet: Cal Cities Resolutions and the General Assembly 1400 K Street, Suite 400, Sacramento, CA 95814 • 916.658.8200 • calcities.org

iiiit
A, LEAGUE OF

CALIFORNIA
\.�' CITIES
General Assembly Voting Guidelines
1 . One City One Vote. Each member city has a right to cast one vote on matters pertaining to Cal Cities policy.

2. Designating a City Voting Representative. Prior to the Cal Cities Annual Conference and Expo, each city council may designate a voting delegate and up to two alternates; these individuals are identified on the voting delegate form provided to the Cal Cities Credentials Committee.

3. Registering with the Credentials Committee. The voting delegate, or alternates, may pick up the city's voting card at the voting delegate desk in the conference registration area. Voting delegates and alternates must sign in at the voting delegate desk. Here they will receive a special sticker on their name badge and thus be admitted to the voting area at the General Assembly.

4. Signing Initiated Resolution Petitions. Only those individuals who are voting delegates (or alternates), and who have picked up their city's voting card by providing a signature to the credentials committee at the voting delegate desk, may sign petitions to initiate a resolution.

5. Voting. To cast the city's vote, a city official must have in their possession the city's voting card and voting tool; and be registered with the credentials committee. The voting card may be transferred freely between the voting delegate and alternates but may not be transferred to another city official who is neither a voting delegate nor alternate.

6. Voting Area at General Assembly. At the General Assembly, individuals with a voting card will sit in a designated area. Admission to the voting area will be limited to the individual in possession of the voting card and with a special sticker on their name badge identifying them as a voting delegate.

7. Resolving Disputes. In case of dispute, the credentials committee will determine the validity of signatures on petitioned resolutions and the right of a city official to vote at the General Assembly.
1400 K Street, Suite 400, Sacramento, CA 95814 • 916.658.8200 • c. Page 20 of 673

LEAGUE OF How it works: Cal Cities

CALIFORNIA
CITIES Resolutions and the General Assembly
Developing League of California Cities policy is a dynamic process that engages a wide range of members to ensure Cal Cities represents cities with one voice.These policies directly guide Cal Cities' advocacy to promote local decision-making, and lobby against statewide policies that erode local control.

The resolutions process and General Assembly is one way that city officials can directly participate in the development of Cal Cities policy. If a resolution is approved at the General Assembly, it becomes official Cal Cities policy. Here's how resolutions and the General Assembly work.

Who's who
Cal Cities policy
General Resolutions Policy Committees development is a member- ty days before the • • • The Cal Cities informed process, Annual Conference President assigns grounded in the voices and Sixand Expo, Cal Cities general resolutions experiences of city officials members may submit to policy committees throughout the state. policy proposals on where members
issues of importance review, debate, and recommend The Resolutions Committee to cities. The resolution must positions for each policy proposal. includes representatives have the concurrence of at least Recommendations are forwarded from each Cal Cities five additional member cities or to the Resolutions Committee. diversity caucus, regional individual members. division, municipal
1 department, and policy
committee, as well as
individuals appointed by
the Cal Cities president.

Petitioned Resolutions Resolutions Committee
The petitioned • • • The Resolutions Voting delegates 4Z1 J9 resolution is an Committee considers are appointed by each di alternate method dirk all resolutions. General member city; every city to introduce policy Resolutions approved' by has one voting delegate. proposals during either a policy committee
the annual conference. The or the Resolutions Committee are next The General Assembly is a petition must be signed by considered by the General Assembly. meeting of the collective voting delegates from 10%of General resolutions not approved, or body of all voting member cities, and submitted to referred for further study by both a delegates—one from the Cal Cities President at least policy committee and the Resolutions every member city. 24 hours before the beginning Committee do not go to the General of the General Assembly. Assembly. All Petitioned Resolutions Seven policy committees are considered by the General meet throughout the year Assembly, unless disqualified.2 to review and recommend positions to take on bills
IF
and regulatory proposals.

Policy committees include
General Assembly members from each Cal
• fi Duringthe General Assembly, votingdelegates Cities diversity caucus, '1°II'•�• Ail.• g
•4 ;00 ;�11I debate and consider general and petitioned regional division, and • •,•,• • resolutions forwarded by the Resolutions municipal department, lir Committee. Potential Cal Cities bylaws as well as individuals amendments are also considered at this meeting. appointed by the Cal Cities president.
'The Resolution Committee can amend a general resolution prior to sending it to the General Assembly. 2 Petitioned Resolutions may be disqualified by the Resolutions Committee according to Cal Cities Bylaws Article VI.Sec.5(f). Page 21 of 673 For more information visit www.calcities.org/general-assembly

:,' Up`q� CITYUPLAND
, �` "The City of Gracious Living"
DATE: June 22,2026
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:STEPHEN PARKER, CPA,ASSISTANT CITY MANAGER

STACI SULLIVAN,FINANCE MANAGER
SUBJECT: CONSIDER APPROVAL OF MAY WARRANT AND PAYROLL REGISTERS RECOMMENDED ACTION:

It is recommended that the City Council approve the May warrant registers totaling$13,338,983.74(check numbers 57146—57481 and direct disbursements)and payroll registers totaling$2,098,528(check numbers 164655—164672 and electronic fund transfers 62722—63308).

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

BACKGROUND
The City Council is presented with the financial disbursements for the purchase of materials,supplies,services,capital projects,and payroll warrants issued in the prior month.This process provides the City Council with the opportunity to review the monthly expenses of the city.

ISSUES AND ANALYSIS
In accordance with Government Code 37208,the Finance Manager hereby certifies that the attached warrant registers, direct disbursements and payroll registers have been found to conform to the approved budget and have been paid.

These demands are submitted to the City Council for review and approval.

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
Funds are available for the payment of the warrant registers,direct disbursements and payroll registers in accordance with the Fiscal Year 2025-26 operating budget.

ALTERNATIVES
Provide alternative direction to staff.

CEQA:Not a Project.

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CHECK# CHECK DATE CHECK TYPE VENDOR# VENDOR NAME CHECK AMOUNT 57425 05/27/2026 PRINTED 1372 ALEXANDER CARRASCO JR $ 4,450.00 57426 05/27/2026 PRINTED 1755 CIVICA LAW GROUP,APC $ 17,207.60 57427 05/27/2026 PRINTED 2058 CODE 4 UNIFORMS INC $ 830.23 57428 05/27/2026 PRINTED 45421 COSTAR REALTY INFORMATION GROUP INC $ 695.21 57429 05/27/2026 PRINTED 98312 COOPERATIVE PERSONNEL SERVICES $ 890.75 57430 05/27/2026 PRINTED 124 DEPARTMENT OF JUSTICE $ 473.00 57431 05/27/2026 PRINTED 2130 DEPT OF CONSERVATION $ 204.27 57432 05/27/2026 PRINTED 10485 EXPERIAN $ 75.00 57433 05/27/2026 PRINTED 123041 FRIENDS OF UPLANMLSHLTR INC $ 504.24 57434 05/27/2026 PRINTED 2153 GEORGE HILLS COMPANY $ 3,085.40 57435 05/27/2026 PRINTED 329 HOLLIDAY ROCK CO INC $ 390.06 57436 05/27/2026 PRINTED 4137 INLAND FAIR HOUSING MEDIATION BOARD $ 1,090.45 57437 05/27/2026 PRINTED 14657 INLAND VALLEY RECOVERY SVCS $ 3,397.50 57438 05/27/2026 PRINTED 106951 INTEGRATED TECHNOLOGY $ 1,149.58 57439 05/27/2026 PRINTED 583 KING FENCING INC $ 3,000.00 57440 05/27/2026 PRINTED 15595 L D M ASSOCIATES INC $ 21,447.00 57441 05/27/2026 PRINTED 1882 LAWNSCAPE SYSTEMS INC $ 4,995.00 57442 05/27/2026 PRINTED 91491 LIBRARY SYSTEMS&SERVICES LLC $ 14,461.20 57443 05/27/2026 PRINTED 1845 LWP CLAIMS SOLUTIONS INC $ 3,830.00 57444 05/27/2026 PRINTED 1530 CHRISTINA LEACH $ 718.20 57445 05/27/2026 PRINTED 2057 TRACY MONTEZ $ 362.70 57446 05/27/2026 PRINTED 58641 MUSCO SPORTS LIGHTING,LLC $ 7,367.80 57447 05/27/2026 PRINTED 117121 NUCKLES OIL COMPANY INC $ 41,889.93 57448 05/27/2026 PRINTED 2089 ROBERT NURSALL $ 370.00 57449 05/27/2026 PRINTED 788 0 F WOLFINBARGER INC $ 391.50 57450 05/27/2026 PRINTED 42771 OCCU-MED LTD $ 1,621.75 57451 05/27/2026 PRINTED 30971 OCCUPATIONAL HEALTH CENTERS $ 211.00 57452 05/27/2026 PRINTED 1897 OVATION SCHOOL FOR THE PERFORMING ARTS $ 981.89 57453 05/27/2026 PRINTED 1434 POWERDMS INC $ 6,400.37 57454 05/27/2026 PRINTED 2021 PROTERRA BUILDERS INC $ 54,835.55 57455 05/27/2026 PRINTED 909 PSYCHOLOGICAL CONSULTING ASSOCIATES INC $ 520.00 57456 05/27/2026 PRINTED 1864 REAL GONE PEST CONTROL $ 1,040.00 57457 05/27/2026 PRINTED 2171 RHA LANDSCAPE ARCHITECTS-PLANNERS INC $ 13,690.00 57458 05/27/2026 PRINTED 1319 ROJAS,JACINTO $ 178.58 57459 05/27/2026 PRINTED 1649 ROSALES,HECTOR $ 179.40 57460 05/27/2026 PRINTED 67381 ROUTE 66 CAR WASH INC $ 621.00 57461 05/27/2026 PRINTED 1321 SHEWAK&LAJWANTI INTERNATIONAL INC $ 4,500.00 57462 05/27/2026 PRINTED 11671 SAN BERNARDINO COUNTY $ 6,371.84 57463 05/27/2026 PRINTED 20171 SAN BERNARDINO COUNTY SHERIFF $ 1,180.00 57464 05/27/2026 PRINTED 2166 HECTOR SANCHEZ $ 461.32 57465 05/27/2026 PRINTED 1917 SDI PRESENCE LLC $ 11,507.50 57466 05/27/2026 PRINTED 1970 SHARP BUSINESS SYSTEMS $ 108.83 57467 05/27/2026 PRINTED 637 SMART&FINAL IRIS CO $ 398.35 57468 05/27/2026 PRINTED 28271 SOUTH COAST AQMD $ 172.49 57469 05/27/2026 PRINTED 1608 STAFFING NETWORK HOLDINGS,LLC $ 1,276.40 57470 05/27/2026 PRINTED 16607 STAPLES BUSINESS ADVANTAGE $ 832.23 57471 05/27/2026 PRINTED 4463 THE COUNSELING TEAM INTERNATIONAL $ 2,000.00 57472 05/27/2026 PRINTED 11583 THOMPSON PLUMBING SUPPLY $ 2,782.83 57473 05/27/2026 PRINTED 125411 TYLER TECHNOLOGIES INC $ 1,600.00 57474 05/27/2026 PRINTED 4481 VCA CENTRAL ANIMAL HOSPITAL $ 175.13 57475 05/27/2026 PRINTED 1261 WEX HEALTH INC $ 183.15 57476 05/27/2026 PRINTED 1188 WHITE CAP,L.P. $ 2,721.62 57477 05/27/2026 PRINTED 14050 WILLDAN FINANCIAL SERVICES $ 3,237.00 57478 05/27/2026 PRINTED 1946 WIRZ&COMPANY, INC $ 32,324.70 57479 05/27/2026 PRINTED 999999 JENNIFER GUERRERO $ 500.00 57480 05/27/2026 PRINTED 999999 LEANDRA PESCASIO $ 160.00 57481 05/27/2026 PRINTED 999999 YUNEJEONG CHOI AKARAKA $ 160.00

CHECK# CHECK DATE CHECK TYPE VENDOR# VENDOR NAME CHECK AMOUNT PRINTED CHECKS(336 COUNT) $ 2,078,409.80
50126001 05/01/2026 MANUAL 1499 EMPOWER TRUST COMPANY, LLC $ 4,468.10 50526001 05/05/2026 MANUAL 32091 SOUTHERN CALIF EDISON CO $ 41,317.60 50526004 05/05/2026 MANUAL 32091 SOUTHERN CALIF EDISON CO $ 0.40 50526002 05/05/2026 MANUAL 153 INLAND EMPIRE UTILITIES AGENCY $ 83,656.04 50526003 05/05/2026 MANUAL 43651 U S BANK NATIONAL ASSN $ 73,776.51 50626001 05/06/2026 MANUAL 543 SOUTHERN CALIF GAS COMPANY $ 2,374.19 50726001 05/07/2026 MANUAL 627 STATE OF CALIFORNIA EMPLOYMENT DEVELOPMENT $ 6,605.00 50726002 05/07/2026 MANUAL 153 INLAND EMPIRE UTILITIES AGENCY $ 41,752.62 50726003 05/07/2026 MANUAL 2019 STONE CREEK ESCROW,INC $ 23,750.00 50726004 05/07/2026 MANUAL 1845 LWP CLAIMS SOLUTIONS INC $ 35,380.00 50726005 05/07/2026 MANUAL 2019 STONE CREEK ESCROW,INC $ 52,900.00 50826001 05/08/2026 MANUAL 32091 SOUTHERN CALIF EDISON CO $ 79.15 50826002 05/08/2026 MANUAL 116231 NEOPOST USA INC $ 2,000.00 50826003 05/08/2026 MANUAL 13121 GENTRY BROTHERS INC $ 125,554.66 50826004 05/08/2026 MANUAL 13121 GENTRY BROTHERS INC $ (6,277.73) 51326001 05/13/2026 MANUAL 65181 CALPERS $ 260,173.94 51526001 05/15/2026 MANUAL 32091 SOUTHERN CALIF EDISON CO $ 227,348.41 51526002 05/15/2026 MANUAL 1845 LWP CLAIMS SOLUTIONS INC $ 44,881.77 51526003 05/15/2026 MANUAL 441 MIDAMERICAADMIN&RETIREMENT SOLUTIONS,LLC $ 33,954.45 51526004 05/15/2026 MANUAL 2041 AFSCME DC 36 $ 1,440.75 51526005 05/15/2026 MANUAL 618 ICMA-RC $ 1,568.75 51526006 05/15/2026 MANUAL 2164 ERIKA SANTANA $ 207.69 51526007 05/15/2026 MANUAL 441 MIDAMERICAADMIN&RETIREMENT SOLUTIONS,LLC $ 1,516.58 51526008 05/15/2026 MANUAL 125761 CITY EMPLOYEE ASSOCIATES $ 532.00 51526009 05/15/2026 MANUAL 736 UPLAND POLICE MANAGEMENT ASSN $ 1,136.50 51526010 05/15/2026 MANUAL 621 KAREN LONG $ 187.50 51526011 05/15/2026 MANUAL 1594 COBRA PROFESSIONALS,INC $ 4,202.81 51526012 05/15/2026 MANUAL 737 UPLAND POLICE OFFICERS ASSN $ 4,938.00 51526013 05/15/2026 MANUAL 1597 TRUSTMARK VOLUNTARY BENEFIT ADMINISTRATOR $ 2,193.62 51526014 05/15/2026 MANUAL 1499 EMPOWER TRUST COMPANY, LLC $ 91,708.23 51526015 05/15/2026 MANUAL 1589 LIVELY INC $ 5,901.30 52026001 05/20/2026 MANUAL 2153 GEORGE HILLS COMPANY $ 32,528.53 52026002 05/20/2026 MANUAL 153 INLAND EMPIRE UTILITIES AGENCY $ 754,404.61 52026003 05/20/2026 MANUAL 1449 CALIFORNIA ASSET MANAGEMENT PROGRAM-CAMP $ 1,600,000.00 52126001 05/21/2026 MANUAL 123041 FRIENDS OF UPLANMLSHLTR INC $ 6,500.00 52126002 05/21/2026 MANUAL 153 INLAND EMPIRE UTILITIES AGENCY $ 26,625.74 52126003 05/21/2026 MANUAL 13121 GENTRY BROTHERS INC $ 562,100.00 52126004 05/21/2026 MANUAL 13121 GENTRY BROTHERS INC $ (28,105.00) 52126005 05/21/2026 MANUAL 1308 LOCAL AGENCY INVESTMENT AGENCY-LAIF $ 5,500,000.00 52226001 05/22/2026 MANUAL 65181 CALPERS $ 259,419.44 52626001 05/26/2026 MANUAL 116231 NEOPOST USA INC $ 2,000.00 52726001 05/27/2026 MANUAL 153 INLAND EMPIRE UTILITIES AGENCY $ 41,752.62 52726002 05/27/2026 MANUAL 91491 LIBRARY SYSTEMS&SERVICES LLC $ 124,334.00 52726003 05/27/2026 MANUAL 760 WATER FACILITIES AUTHORITY $ 294,044.30 52826001 05/28/2026 MANUAL 529 KAISER FOUNDATION HEALTH PLAN $ 203,335.47 52826002 05/28/2026 MANUAL 529 KAISER FOUNDATION HEALTH PLAN $ 35,487.37 52826003 05/28/2026 MANUAL 529 KAISER FOUNDATION HEALTH PLAN $ 14,225.09 52826004 05/28/2026 MANUAL 1282 WESTERN ALLIANCE BUSINESS TRUST $ 85,812.15 52826005 05/28/2026 MANUAL 114711 METROPOLITAN LIFE INSURANCE CO $ 1,456.05 52826006 05/28/2026 MANUAL 960 MUNICIPAL DENTAL POOL $ 29,369.33 52826007 05/28/2026 MANUAL 754 PUBLIC AGENCY COALITION ENTERPRISE $ 112,691.96 52826008 05/28/2026 MANUAL 11484 U S BANK $ 250,000.00 52826009 05/28/2026 MANUAL 32091 SOUTHERN CALIF EDISON CO $ 43,559.53 52926002 05/29/2026 MANUAL 126761 THE LINCOLN NATIONAL LIFE INS $ 9,716.32 52926003 05/29/2026 MANUAL 123041 FRIENDS OF UPLANMLSHLTR INC $ 6,500.00

CHECK# CHECK DATE CHECK TYPE VENDOR# VENDOR NAME CHECK AMOUNT 52926004 05/29/2026 MANUAL 123041 FRIENDS OF UPL ANML SHLTR INC $ 6,500.00 52926005 05/29/2026 MANUAL 1337 STANDARD INSURANCE COMPANY $ 3,484.40 52926006 05/29/2026 MANUAL 441 MIDAMERICAADMIN&RETIREMENT SOLUTIONS,LLC $ 1,547.00 52926007 05/29/2026 MANUAL 621 KAREN LONG $ 187.50 52926008 05/29/2026 MANUAL 2164 ERIKA SANTANA $ 207.69 52926009 05/29/2026 MANUAL 736 UPLAND POLICE MANAGEMENT ASSN $ 1,136.50 52926010 05/29/2026 MANUAL 2041 AFSCME DC 36 $ 1,412.50 52926011 05/29/2026 MANUAL 737 UPLAND POLICE OFFICERS ASSN $ 4,938.00 52926012 05/29/2026 MANUAL 125761 CITY EMPLOYEE ASSOCIATES $ 532.00 52926013 05/29/2026 MANUAL 1594 COBRA PROFESSIONALS,INC $ 4,158.65 52926014 05/29/2026 MANUAL 618 ICMA-RC $ 1,593.75 52926015 05/29/2026 MANUAL 1499 EMPOWER TRUST COMPANY, LLC $ 93,175.55 52926016 05/29/2026 MANUAL 1589 LIVELY INC $ 5,591.05 MANUAL CHECKS(68 COUNT) $11,261,450.94
56737 03/25/2026 VOID 2190 TAMMYAVILA $ (107.00) 56908 04/08/2026 VOID 102108 STATE OF CALIFORNIA DMV $ (770.00) VOID CHECKS(2 COUNT) $ (877.00)
PRINTED CHECKS(336 COUNT) $ 2,078,409.80
MANUAL CHECKS(68 COUNT) $ 11,261,450.94
VOID CHECKS(2 COUNT) $ (877.00)
PRINTED&MANUAL CHECK TOTALS $13,338,983.74

4oFvp, City of Upland
�� 'yd Vendor Payments Made Greater Than $100,000
05/01/2026-05/31/2026
9 C•LIFO Tt tit'
TOTAL PAID FOR MAY 2026
VENDOR LISTING(SUM OF PAYMENTS>$100,000 TOTAL AMOUNT DESCRIPTION LOCAL AGENCY INVESTMENT AGENCY-LAIF $ 5,500,000.00 INVESTMENT ACTIVITY CALIFORNIA ASSET MANAGEMENT PROGRAM-CAMP $ 1,600,000.00 INVESTMENT ACTIVITY CALPERS $ 519,593.38 RETIREMENT/PENSION
EMPOWER TRUST COMPANY,LLC $ 189,351.88 RETIREMENT/DEFERRED COMP GENTRY BROTHERS INC $ 653,271.93 PROGRESS PAYMENT#5&6 FOOTHILL BLVD PRJ INLAND EMPIRE UTILITIES AGENCY $ 949,187.93 WATER/WASTEWATER TREATMENT AGENCY KAISER FOUNDATION HEALTH PLAN $ 253,047.93 EMPLOYEE MEDICAL INSURANCE LIBRARY SYSTEMS&SERVICES LLC $ 145,219.86 CONTRACT LIBRARY SERVICES PUBLIC AGENCY COALITION ENTERPRISE $ 112,691.96 EMPLOYEE MEDICAL INSURANCE SAN ANTONIO WATER CO $ 299,267.95 WATER ASSESMENT CHARGES SOUTHERN CALIF EDISON CO $ 312,305.09 ELECTRICITY-UTILITY BILLING TRITECH SOFTWARE SYSTEMS $ 172,573.94 POLICE CAD,RMS&MOBILE APP SUBSCRIPTION U S BANK $ 254,625.00 INVESTMENT ACTIVITY
VIDO SAMARZICH,INC $ 189,832.59 PAVEMENT REHAB RETENTION RELEASE WATER FACILITIES AUTHORITY $ 294,044.30 WATER/WASTEWATER TREATMENT AGENCY GRAND TOTAL $ 11,445,013.74

OF tri3
T,t, CITY OF UPLAND
CdPayroll Costs
Payroll
4/26/2026 Through 5/09/2026 Check Date: 5/14/2026
Checks $35,961.80
Manual Checks $0.00
Void Checks $0.00
Direct Deposit $799,401.56
Manual Direct Deposit $0.00
Void Direct Deposit 0.00
$835,363.36 1
Taxes
4/26/2026 Through 5/09/2026 Check Date: 5/14/2026
Federal 161,015.65
State 51,858.34
212,873.99 I
Prepared by: Yesica Montoya
$1,048,237.35
M:IPAYROLLIForms\Payroll Costs & Register Cover Page 1

OF UAi
,Y<S� 13 CITY OF UPLAND
F Payroll Costs
,a.
�LIFo��
Payroll
5/10/2026 Through 5/23/2026 Check Date: 5/28/2026
Checks $6,217.90
Manual Checks $0.00
Void Checks $0.00
Direct Deposit $834,722.97
Manual Direct Deposit $0.00
Void Direct Deposit 0.00
$840,940.87 I
Taxes
5/10/2026 Through 5/23/2026 Check Date: 5/28/2026
Federal 158,181.04
State 51,168.74
209,349.78 I
Prepared by: Yesica Montoya
$1,050,290.65
M:IPAYROLLIForms\Payroll Costs & Register Cover Page 1

����°� °p`q� CITY
UPLAND
�r. .__. ..` "The City of Gracious Living" ''' 5 oid.

DATE: June 22,2026
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:STEPHEN PARKER,CPA,ASSISTANT CITY MANAGER

STACI SULLIVAN,FINANCE MANAGER
SUBJECT: CONSIDER APPROVAL OF THE SECOND AMENDMENT TO THE AGREEMENT WITH

HDL COMPANIES FOR CONTRACT BUSINESS LICENSE SERVICES
RECOMMENDED ACTION:

It is recommended that the City Council approve the Second Amendment to the Agreement with HdL Companies for contract business license services for one additional year through June 30,2027,in an amount not-to-exceed$150,000 for the extension period;and authorize the City Manager to execute the Second Amendment.

GOAL STATEMENT
The proposed action supports the City's goal of providing services in a cost-effective manner.

BACKGROUND
On September 12,2022,the City Council approved an agreement with HdL Companies for contract business license services through June 30,2025,with two mutual one-year additional terms and a not-to-exceed amount of$395,000.

On June 9, 2025, the City Council approved the First Amendment to the Agreement for contract business license services through June 30,2026,with one mutual one-year additional term and a not-to-exceed amount of$150,000.

ISSUES AND ANALYSIS
HdL has agreed to provide the same services as described in the Agreement for a term ending June 30,2027.Effective July 1, 2026, HdL will tax$20.00 per account for each business license processed. For collections,HdL keeps 25% on past due amounts collected, plus a one-time fee of 35% for any revenues generated through discovery of new businesses and audits.

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
The estimated cost for contract business license services is $150,000 and is included as part of the Fiscal Year 2026- 27—2027-28 biennial budget.

ALTERNATIVES
Provide alternative direction to staff.

CEQA:Not a Project.

AMENDMENT NO. 2 TO

MASTER SERVICE AGREEMENT

WITH HINDERLITER, DE LLAMAS & ASSOCIATES

FOR BUSINESS LICENSE ADMINISTRATION AND COMPLIANCE SERVICES This Amendment No. 2 to the Master Service Agreement for Business License Administration and Compliance Services is made and entered into as of June 22, 2026 ("Effective Date") by and between the City of Upland, a municipal corporation ("City") and Hinderliter de Llamas and Associates, a California company ("Consultant"). City and Consultant are sometimes referred to herein individually as a "Party" and collectively as "Parties."

RECITALS
A. WHEREAS, the City and the Consultant have entered into an agreement, dated September 12, 2022, for the purpose of providing Business License Administration and Compliance Services (the "Agreement").

B. WHEREAS, the City and the Consultant have entered into an Amendment No. 1 to the Agreement, dated June 9, 2025, for the purpose of extending the term of the Agreement from October 1, 2022, through June 30, 2026, and providing additional funds for the continued performance of services for an amount not to exceed Five Hundred Forty-Five Thousand ($545,000).

C. WHEREAS, the Parties now desire to amend the Agreement in order to extend the term for an additional term of one year for the period of July 1, 2026, to June 30, 2027, and to include additional funds for the continued performance of the services in accordance with the compensation provisions of the Agreement.

NOW, THEREFORE, in consideration of the above recitals and the mutual covenants, conditions, and promises contained in this Amendment No. 2 and the Agreement, the Parties mutually agree as follows:

AGREEMENT

1. Incorporation of Recitals. The recitals listed above are true and correct and are hereby incorporated herein by this reference.

2. Term. The term of the Agreement shall be extended through June 30, 2027, unless earlier terminated.

3. Compensation. The compensation for services performed pursuant to this Amendment No. 2 shall not exceed One Hundred and Fifty Thousand Dollars ($150,000), thereby increasing the total not to exceed compensation of the Agreement to the amount of Six Hundred and Ninety Five Thousand Dollars ($695,000). The total not to exceed does not apply to compensation for services which are billed a contingency fee based on -1-

revenue recovered, or to payment processing services which are billed according to usage. Work shall be performed at the rates set forth in the Agreement.

4. Full Force. Except as amended by this Amendment No. 2, all provisions of the Agreement, including without limitation the indemnity and insurance provisions, shall remain in full force and effect and shall govern the actions of the Parties under this Amendment No. 2.

5. Electronic Transmission. A manually signed copy of this Amendment No. 2 which is transmitted by facsimile, email or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original executed copy of this Amendment No. 2 for all purposes. This Amendment No. 2 may be signed using an electronic signature.

6. Counterparts. This Amendment No. 2 may be signed in counterparts, each of which shall constitute an original.
[SIGNATURES ON FOLLOWING PAGE]
-2-

SIGNATURE PAGE FOR
AMENDMENT NO. 2 TO MASTER SERVICE AGREEMENT

WITH HINDERLITER, DE LLAMAS & ASSOCIATES

FOR BUSINESS LICENSE ADMINISTRATION AND COMPLIANCE SERVICES IN WITNESS WHEREOF, the Parties hereto have executed this Amendment No. 2 on the Effective Date first herein above written.

CITY OF UPLAND HINDERLITER, DE LLAMAS &

ASSOCIATES
APPROVED BY:

Michael Blay Joshua Davis
City Manager Vice President of TFA
ATTESTED BY:

City Clerk, CMC
Keri Johnson
APPROVED AS TO FORM:

Best Best & Krieger LLP
City Attorney
-3-

Docusign Envelope ID:53A81135-17FC-4F36-A1 BB-E6A127338B5F

FIRST AMENDMENT TO MASTER SERVICE AGREEMENT

FOR BUSINESS LICENSE AND COMPLIANCE SERVICES
This First Amendment to the Master Service Agreement for Business License Administration and Compliance Services("First Amendment")is made and entered into on the 9th of June,2025,by and between the City of Upland, a municipal corporation ("City), and Hinderliter de Llamas and Associates, a California company ("Consultant"). City and Consultant are sometimes individually referred to herein as "Party" and collectively as "Parties."

RECITALS
A. WHEREAS, the Parties have entered into a Master Service Agreement for Business License Administration and Compliance dated September 12, 2022 ("Agreement") for the purpose of Business License Administration and Compliance Services through June 30,2025.

B. WHEREAS, the Parties now desire to amend the Agreement to extend the Term of the Agreement to June 30, 2026 continuing the Business license Administration and Compliance Services.

C. WHEREAS, the Parties now desire to amend the Agreement to increase the compensation due Consultant for the period July 1,2025 to June 30,2026 by an additional$150,000 for an aggregate amount not to exceed$495,000 for Business License Administration and Compliance Services.

AGREEMENT

1. Incorporation of Recitals. The recitals listed above are true and correct and are hereby incorporated herein by this reference.

2. Term. The term of the Original Agreement shall be extended for one (1) year commencing July 1,2025 through June 30,2026 ("Extended Term")unless earlier terminated

3. Compensation.
a. The compensation for services performed pursuant to the Extended Term shall not exceed the total cost of$150,000, for an aggregate amount not to exceed $495,000 for Business License Administration and Compliance Services. b. The City Manager may approve Additional Work up to ten percent (10%) of the amount of the Agreement or$49,500. In no event shall the total sum of the Agreement exceed$544,500.

4. Fees: Fees for the Business License Administration and Compliance Services during the Extended Term shall be:
• Admin BL=$20.00 per account processed
• Collection Fees=25%
• Discovery Fees=35%
• Audit Fees=35%

5. Full Force and Effect of Agreement. Except as amended by this First Amendment, all terms and provisions of the Agreement shall remain in full force and effect. [SIGNATURES ON FOLLOWING PAGE]

Docusign Envelope ID:53A81135-17FC-4F36-A1 BB-E6A127338B5F IN WITNESS WHEREOF, City and Consultant have approved this First Amendment effective the day and year first above written.

CITY OF UPLAND,CA HINDERLITER DE LLAMAS &
ASSOC.

DoeuSigned bY: signed by:

By:[M.�c�.ad 661 By: [�as(c1auis
Michael Blay,City Manager Joshua Davis,VP of TFA
Attested by:

By: [ooeusignea by:

Rr3
Keri Johnson, City Clerk
Approved as to form:

Signed by:

By: (—Signed
Nufsdti
Best Best&Krieger LLP
City Attorney

CITY OF UPLAND

PROFESSIONAL SERVICES AGREEMENT
This Agreement is made and entered into as of September 12, 2022 by and between the City of Upland, a public agency organized and operating under the laws of the State of California with its principal place of business at 460 N. Euclid Avenue, Upland, CA 91786 ("City"), and HdL Companies, a California CORPORATION with its principal place of business at 120 S. State College Blvd., Suite 200, Brea, CA 92821 (hereinafter referred to as "Consultant"). City and Consultant are sometimes individually referred to as "Party" and collectively as "Parties" in this Agreement.

RECITALS
A. City is a public agency of the State of California and is in need of professional services for the following project:

Contract Business License Services (hereinafter referred to as"the Project").

B. Consultant is duly licensed and has the necessary qualifications to provide such services.

C. The Parties desire by this Agreement to establish the terms for City to retain Consultant to provide the services described herein.

AGREEMENT
NOW, THEREFORE, IT IS AGREED AS FOLLOWS:

1. Services.

Consultant shall provide the City with the services described in the Scope of Services and Schedule of Charges attached hereto as Exhibit"A."

2. Compensation.
a. Subject to paragraph 2(b) below, the City shall pay for such services in accordance with the Scope of Services and Schedule of Charges set forth in Exhibit"A." b. In no event shall the total amount paid for services rendered by Consultant under this Agreement exceed the sum of$395,000. Periodic payments shall be made within 30 days of receipt of an invoice which includes a detailed description of the work performed.

Payments to Consultant for work performed will be made on a monthly billing basis. c. The City Manager may approve Additional Work, as further defined in Section 3, up to ten percent (10%) of the amount of the Agreement or thirty nine thousand five hundred dollars ($39,500.00). In no event shall the total sum of the agreement (original compensation amount and Additional Work)exceed four hundred thirty four thousand five hundred dollars($434,500.00). Any additional work in excess of this amount shall be approved by the City Council.

3. Additional Work.

If changes in the work seem merited by Consultant or the City, and informal consultations with the other party indicate that a change is 1 arranted, it shall be processed in the following

manner: a letter outlining the changes shall be forwarded to the City by Consultant with a statement of:estimated changes in fee or time schedule. An amendment to this Agreement shall be prepared by the City and executed by both Parties before performance of such services, or the City will not be required to pay for the changes in the scope of work. Such amendment shall not render ineffective or invalidate unaffected portions of this Agreement.

4. Maintenance of Records.

Books, documents, papers, accounting records, and other evidence pertaining to costs incurred shall be maintained by Consultant and made available at all reasonable times during the contract period and for four (4) years from the date of final payment under the contract for inspection by City.

5. Term.

The term of this Agreement shall be from October 1, 2022 to June 30,2025, unless earlier terminated as provided herein. The Parties may, by mutual, written consent, extend the term of this Agreement for two, one-year additional terms.

6. Delays in Performance.
a. Neither City nor Consultant shall be considered in default of this Agreement for delays in performance caused by circumstances beyond the reasonable control of the non- performing party. For purposes of this Agreement, such circumstances include but are not limited to, abnormal weather conditions; floods; earthquakes; fire; epidemics; pandemics; war; riots and other civil disturbances; strikes, lockouts, work slowdowns, and other labor disturbances; sabotage or judicial restraint.
b. Should such circumstances occur, the non-performing party shall, within a reasonable time of being prevented from performing, give written notice to the other party describing the circumstances preventing continued performance and the efforts being made to resume performance of this Agreement.

7. Compliance with Law.
a. Consultant shall comply with all applicable laws, ordinances, codes and regulations of the federal, state and local government, including Cal/OSHA requirements. b. If required, Consultant shall assist the City, as requested, in obtaining and maintaining all permits required of Consultant by federal, state and local regulatory agencies. c. If applicable, Consultant is responsible for all costs of clean up and/or removal of hazardous and toxic substances spilled as a result of his or her services or operations performed under this Agreement.

8. Standard of Care
Consultant's services will be performed in accordance with generally accepted professional practices and principles and in a manner consistent with the level of care and skill ordinarily exercised by members of the profession currently practicing under similar conditions. 2

9. Assignment and Subconsultant
Consultant shall not assign, sublet, or transfer this Agreement or any rights under or interest in this Agreement without the written consent of the City, which may be withheld for any reason. Any attempt to so assign or so transfer without such consent shall be void and without legal effect and shall constitute grounds for termination. Subcontracts, if any, shall contain a provision making them subject to all provisions stipulated in this Agreement. Nothing contained herein shall prevent Consultant from employing independent associates, and subconsultants as Consultant may deem appropriate to assist in the performance of services hereunder.

10. Independent Contractor
Consultant is retained as an independent contractor and is not an employee of City. No employee or agent of Consultant shall become an employee of City. The work to be performed shall be in accordance with the work described in this Agreement, subject to such directions and amendments from City as herein provided.
a. PERS Eli: ibility Indemnification
In the event that Consultant or any employee, agent, or subcontractor of Consultant providing services under this Agreement claims or is determined by a court of competent jurisdiction or the California Public Employees Retirement System ("PERS") to be eligible for enrollment in PERS as an employee of the City, Consultant shall indemnify, defend, and hold harmless City for the payment of any employee and/or employer contributions for PERS benefits on behalf of Consultant or its employees, agents, or subcontractors, as well as for the payment of any penalties and interest on such contributions, which would otherwise be the responsibility of City.

Notwithstanding any other agency, state or federal policy, rule, regulation, law or ordinance to the contrary, Consultant and any of its employees, agents, and subcontractors providing service under this Agreement shall not qualify for or become entitled to, and hereby agree to waive any claims to, any compensation, benefit, or any incident of employment by City, including but not limited to eligibility to enroll in PERS as an employee of City and entitlement to any contribution to be paid by City for employer contribution and/or employee contributions for PERS benefits.

11. Insurance. Consultant shall not commence work for the City until it has provided evidence satisfactory to the City it has secured all insurance required under this section. In addition, Consultant shall not allow any subcontractor to commence work on any subcontract until it has secured all insurance required under this section. a. Commercial General Liability
(i) The Consultant shall take out and maintain, during the performance of all work under this Agreement, in amounts not less than specified herein, Commercial General Liability Insurance, in a form and with insurance companies acceptable to the City. (ii) Coverage for Commercial General Liability insurance shall be at least as broad as the following:
(1) Insurance Services Office Commercial General Liability coverage (Occurrence Form CG 00 01) or exact equivalent. 3

(iii) Commercial General Liability Insurance must include coverage for the following:
(1) Bodily Injury and Property Damage
(2) Personal Injury/Advertising Injury
(3) Premises/Operations Liability
(4) Products/Completed Operations Liability
(5) Aggregate Limits that Apply per Project
(6) Explosion, Collapse and Underground (UCX) exclusion deleted
(7) Contractual Liability with respect to this Agreement (8) Property Damage
(9) Independent Contractors Coverage
(iv) The policy shall contain no endorsements or provisions limiting coverage for(1) contractual liability; (2) cross liability exclusion for claims or suits by one insured against another; (3) products/completed operations liability; or (4) contain any other exclusion contrary to the Agreement.
(v) The policy shall give City, its officials, officers, employees, agents and City designated volunteers additional insured status using ISO endorsement forms CG 20 10 10 01 and 20 37 10 01, or endorsements providing the exact same coverage. (vi) The general liability program may utilize either deductibles or provide coverage excess of a self-insured retention, subject to written approval by the City, and provided that such deductibles shall not apply to the City as an additional insured. b. Automobile Liability
(i) At all times during the performance of the work under this Agreement, the Consultant shall maintain Automobile Liability Insurance for bodily injury and property damage including coverage for owned, non-owned and hired vehicles, in a form and with insurance companies acceptable to the City.
(ii) Coverage for automobile liability insurance shall be at least as broad as Insurance Services Office Form Number CA 00 01 covering automobile liability (Coverage Symbol 1, any auto).
(iii) The policy shall give City, its officials, officers, employees, agents and City designated volunteers additional insured status. (iv) Subject to written approval by the City, the automobile liability program may utilize deductibles, provided that such deductibles shall not apply to the City as an additional insured, but not a self-insured retention.
c. Workers' Compensation/Employer's Liability
(i) Consultant certifies that he/she 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 to undertake self-insurance in accordance with the provisions of that code, and he/she will comply with such provisions before commencing work under this Agreement.
4

(ii) To the extent Consultant has employees at any time during the term of this Agreement, at all times during the performance of the work under this Agreement, the Consultant shall maintain full compensation insurance for all persons employed directly by him/her to carry out the work contemplated under this Agreement, all in accordance with the "Workers' Compensation and Insurance Act," Division IV of the Labor Code of the State of California and any acts amendatory thereof, and Employer's Liability Coverage in amounts indicated herein. Consultant shall require all subconsultants to obtain and maintain,for the period required by this Agreement, workers' compensation coverage of the same type and limits as specified in this section.
d. Professional Liability (Errors and Omissions)
At all times during the performance of the work under this Agreement the Consultant shall maintain professional liability or Errors and Omissions insurance appropriate to its profession, in a form and with insurance companies acceptable to the City and in an amount indicated herein.

This insurance shall be endorsed to include contractual liability applicable to this Agreement and shall be written on a policy form specifically designed to protect against acts, errors or omissions of the Consultant. "Covered Professional Services" as designated in the policy must specifically include work performed under this Agreement. The policy must"pay on behalf of'the insured and must include a provision establishing the insurer's duty to defend. e. Minimum Policy Limits Required
(i) The following insurance limits are required for the Agreement:

Combined Single Limit
Commercial General Liability $1,000,000 per occurrence/ $2,000,000 aggregate for bodily injury, personal injury, and property
damage
Automobile Liability $1,000,000 combined single limit Employer's Liability $1,000,000 per accident or disease Professional Liability $1,000,000 per claim and aggregate (errors and omissions)
(ii) Defense costs shall be payable in addition to the limits. (iii) Requirements of specific coverage or limits contained in this section are not intended as a limitation on coverage, limits, or other requirement, or a waiver of any coverage normally provided by any insurance. Any available coverage shall be provided to the parties required to be named as Additional Insured pursuant to this Agreement. f. Evidence Required
Prior to execution of the Agreement,the Consultant shall file with the City evidence of insurance from an insurer or insurers certifying to the coverage of all insurance required 5

herein. Such evidence shall include original copies of the ISO CG 00 01 (or insurer's equivalent) signed by the insurer's representative and Certificate of Insurance (Acord Form 25-S or equivalent), together with required endorsements. All evidence of insurance shall be signed by a properly authorized officer, agent, or qualified representative of the insurer and shall certify the names of the insured, any additional insureds, where appropriate, the type and amount of the insurance, the location and operations to which the insurance applies, and the expiration date of such insurance.
g. Polio/ Provisions Required
(i) Consultant shall provide the City at least thirty (30) days prior written notice of cancellation of any policy required by this Agreement, except that the Consultant shall provide at least ten (10) days prior written notice of cancellation of any such policy due to non-payment of premium. If any of the required coverage is cancelled or expires during the term of this Agreement, the Consultant shall deliver renewal certificate(s) including the General Liability Additional Insured Endorsement to the City at least ten (10) days prior to the effective date of cancellation or expiration.
(ii) The Commercial General Liability Policy and Automobile Policy shall each contain a provision stating that Consultant's policy is primary insurance and that any insurance, self-insurance or other coverage maintained by the City or any named insureds shall not be called upon to contribute to any loss.
(iii) The retroactive date(if any) of each policy is to be no later than the effective date of this Agreement. Consultant shall maintain such coverage continuously for a period of at least three years after the completion of the work under this Agreement. Consultant shall purchase a one (1) year extended reporting period A) if the retroactive date is advanced past the effective date of this Agreement; B) if the policy is cancelled or not renewed; or C) if the policy is replaced by another claims-made policy with a retroactive date subsequent to the effective date of this Agreement.
(iv) All required insurance coverages, except for the professional liability coverage, shall contain or be endorsed to provide a waiver of subrogation in favor of the City, its officials, officers,employees, agents, and volunteers or shall specifically allow Consultant or others providing insurance evidence in compliance with these specifications to waive their right of recovery prior to a loss. Consultant hereby waives its own right of recovery against City, and shall require similar written express waivers and insurance clauses from each of its subconsultants.
(v) The limits set forth herein shall apply separately to each insured against whom claims are made or suits are brought, except with respect to the limits of liability.

Further the limits set forth herein shall not be construed to relieve the Consultant from liability in excess of such coverage, nor shall it limit the Consultant's indemnification obligations to the City and shall not preclude the City from taking such other actions available to the City under other provisions of the Agreement or law.
h. Qualifying Insurers
(i) All policies required shall be issued by acceptable insurance companies, as determined by the City, which satisfy the following minimum requirements:
6

(1) Each such policy shall be from a company or companies with a current A.M. Best's rating of no less than A:VII and admitted to transact in the business of insurance in the State of California, or otherwise allowed to place insurance through surplus line brokers under applicable provisions of the California Insurance Code or any federal law.

Additional Insurance Provisions
(i) The foregoing requirements as to the types and limits of insurance coverage to be maintained by Consultant, and any approval of said insurance by the City, is not intended to and shall not in any manner limit or qualify the liabilities and obligations otherwise assumed by the Consultant pursuant to this Agreement, including but not limited to, the provisions concerning indemnification.
(ii) If at any time during the life of the Agreement, any policy of insurance required under this Agreement does not comply with these specifications or is canceled and not replaced, City has the right but not the duty to obtain the insurance it deems necessary and any premium paid by City will be promptly reimbursed by Consultant or City will withhold amounts sufficient to pay premium from Consultant payments. In the alternative, City may cancel this Agreement.
(iii) The City may require the Consultant to provide complete copies of all insurance policies in effect for the duration of the Project. (iv) Neither the City nor any of its officials, officers, employees, agents or volunteers shall be personally responsible for any liability arising under or by virtue of this Agreement.
j. Subconsultant Insurance Requirements. Consultant shall not allow any subcontractors or subconsultants to commence work on any subcontract until they have provided evidence satisfactory to the City that they have secured all insurance required under this section.

Policies of commercial general liability insurance provided by such subcontractors or subconsultants shall be endorsed to name the City as an additional insured using ISO form CG 20 38 04 13 or an endorsement providing the exact same coverage. If requested by Consultant, City may approve different scopes or minimum limits of insurance for particular subcontractors or subconsultants.

12. Indemnification.
a. To the fullest extent permitted by law, Consultant shall defend (with counsel of City's choosing), indemnify and hold the City, its officials, officers, employees, volunteers, and agents free and harmless from any and all claims, demands, causes of action, costs, expenses, liability, loss, damage or injury of any kind, in law or equity, to property or persons, including wrongful death, in any manner arising out of, pertaining to, or incident to any acts, errors or omissions, or willful misconduct of Consultant, its officials, officers, employees, subcontractors, consultants or agents in connection with the performance of the Consultant's services,the Project or this Agreement, including without limitation the payment of all damages, expert witness fees and attorney's fees and other related costs and expenses. Consultant's obligation to indemnify shall not be restricted to insurance proceeds, if any, received by Consultant, the City, its officials, officers, employees, agents, or volunteers.
7

b. If Consultant's obligation to defend, indemnify, and/or hold harmless arises out of Consultant's performance of"design professional" services (as that term is defined under Civil Code section 2782.8), then, and only to the extent required by Civil Code section 2782.8, which is fully incorporated herein,Consultant's indemnification obligation shall be limited to claims that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Consultant, and, upon Consultant obtaining a final adjudication by a court of competent jurisdiction, Consultant's liability for such claim, including the cost to defend, shall not exceed the Consultant's proportionate percentage of fault.
c. City acknowledges and agrees that any other public agency (including, without limitation, any participating government agency) located within or outside of the State (e.g., city, municipality, county, district, public authority or other political subdivision), may procure services for fees and other terms and conditions that are substantially similar to any of the Services, Fees and other terms and conditions set forth in this Agreement, provided that such other public agency executes a separate with Consultant wherein the services rendered to such other public agency, the fees payable by such other public agency, and the other terms and conditions of such separate agreement are the responsibility of the Consultant and such other public agency and not City.

13. California Labor Code Reiuirements.
a. Consultant is aware of the requirements of California Labor Code Sections 1720 et seq. and 1770 et seq., which require the payment of prevailing wage rates and the performance of other requirements on certain "public works" and "maintenance" projects ("Prevailing Wage Laws"). If the services are being performed as part of an applicable "public works" or "maintenance" project, as defined by the Prevailing Wage Laws, and if the total compensation is $1,000 or more, Consultant agrees to fully comply with such Prevailing Wage Laws. Consultant shall defend, indemnify and hold the City, its officials, officers, employees and agents free and harmless from any claims, liabilities, costs, penalties or interest arising out of any failure or alleged failure to comply with the Prevailing Wage Laws. It shall be mandatory upon the Consultant and all subconsultants to comply with all California Labor Code provisions, which include but are not limited to prevailing wages (Labor Code Sections 1771, 1774 and 1775), employment of apprentices (Labor Code Section 1777.5), certified payroll records (Labor Code Sections 1771.4 and 1776), hours of labor(Labor Code Sections 1813 and 1815) and debarment of contractors and subcontractors (Labor Code Section 1777.1). The requirement to submit certified payroll records directly to the Labor Commissioner under Labor Code section 1771.4 shall not apply to work performed on a public works project that is exempt pursuant to the small project exemption specified in Labor Code Section 1771.4. b. If the services are being performed as part of an applicable "public works" or "maintenance" project, then pursuant to Labor Code Sections 1725.5 and 1771.1, the Consultant and all subconsultants performing such services must be registered with the Department of Industrial Relations. Consultant shall maintain registration for the duration of the Project and require the same of any subconsultants, as applicable. Notwithstanding the foregoing,the contractor registration requirements mandated by Labor Code Sections 1725.5 and 1771.1 shall not apply to work performed on a public works project that is exempt pursuant to the small project exemption specified in Labor Code Sections 1725.5 and 1771.1. c. This Agreement may also be subject to compliance monitoring and enforcement by the Department of Industrial Relations. It shall be Consultant's sole responsibility to comply with all applicable registration and labor compliance requirements. Any stop orders issued by the Department of Industrial Relations against Consultant or any subcontractor that 8

affect Consultant's performance of services, including any delay, shall be Consultant's sole responsibility. Any delay arising out of or resulting from such stop orders shall be considered Consultant caused delay and shall not be compensable by the City. Consultant shall defend, indemnify and hold the City, its officials, officers, employees and agents free and harmless from any claim or liability arising out of stop orders issued by the Department of Industrial Relations against Consultant or any subcontractor.

14. Verification of Employment Eligibility.

By executing this Agreement, Consultant verifies that it fully complies with all requirements and restrictions of state and federal law respecting the employment of undocumented aliens, including, but not limited to,the Immigration Reform and Control Act of 1986, as may be amended from time to time, and shall require all subconsultants and sub-subconsultants to comply with the same.

15. Reserved.

16. Laws and Venue.

This Agreement shall be interpreted in accordance with the laws of the State of California.

If any action is brought to interpret or enforce any term of this Agreement, the action shall be brought in a state or federal court situated in the County of San Bernardino, State of California. 17 Termination or Abandonment
a. City has the right to terminate or abandon any portion or all of the work under this Agreement by giving ten(10)calendar days written notice to Consultant. In such event, City shall be immediately given title and possession to all original field notes, drawings and specifications, written reports and other documents produced or developed for that portion of the work completed and/or being abandoned. City shall pay Consultant the reasonable value of services rendered for any portion of the work completed prior to termination. If said termination occurs prior to completion of any task for the Project for which a payment request has not been received, the charge for services performed during such task shall be the reasonable value of such services, based on an amount mutually agreed to by City and Consultant of the portion of such task completed but not paid prior to said termination. City shall not be liable for any costs other than the charges or portions thereof which are specified herein. Consultant shall not be entitled to payment for unperformed services, and shall not be entitled to damages or compensation for termination of work.
b. Consultant may terminate its obligation to provide further services under this Agreement upon thirty(30)calendar days'written notice to City only in the event of substantial failure by City to perform in accordance with the terms of this Agreement through no fault of Consultant.
18 Documents. Except as otherwise provided in "Termination or Abandonment," above, all original field notes, written reports, Drawings and Specifications and other documents, produced or developed for the Project shall, upon payment in full for the services described in this Agreement, be furnished to and become the property of the City.

19. Organization
9

Consultant shall assign Joshua Davis, Associate Director of Tax and Fee Administration as Project Manager. The Project Manager shall not be removed from the Project or reassigned without the prior written consent of the City.

20. Limitation of Agreement.

This Agreement is limited to and includes only the work included in the Project described above.

21. Notice
Any notice or instrument required to be given or delivered by this Agreement may be given or delivered by depositing the same in any United States Post Office, certified mail, return receipt requested, postage prepaid, addressed to:

CITY: CONSULTANT:

City of Upland HdL Companies
460 N. Euclid Avenue 120 S. State College Blvd., Suite 200 Upland, CA 91786 Brea, CA 92821
Attn: Michael Blay, City Manager Attn: Robert Gray, Director of Tax and Fee Administration
and shall be effective upon receipt thereof.

22. Third Party Rig tits
Nothing in this Agreement shall be construed to give any rights or benefits to anyone other than the City and the Consultant.

23. Equal Opportunity Employment.

Consultant represents that it is an equal opportunity employer and that it shall not discriminate against any employee or applicant for employment because of race, religion, color, national origin, ancestry, sex, age or other interests protected by the State or Federal Constitutions, Such non-discrimination shall include, but not be limited to, all activities related to initial employment, upgrading, demotion,transfer, recruitment or recruitment advertising, layoff or termination.

24. Entire Agreement
This Agreement, with its exhibits, represents the entire understanding of City and Consultant as to those matters contained herein, and supersedes and cancels any prior or contemporaneous oral or written understanding, promises or representations with respect to those matters covered hereunder. Each Party acknowledges that no representations, inducements, promises or agreements have been made by any person which are not incorporated herein, and that any other agreements shall be void. This Agreement may not be modified or altered except in writing signed by both Parties hereto. This is an integrated Agreement. 10

25. Severability
The unenforceability, invalidity or illegality of any provision(s) of this Agreement shall not render the remaining provisions unenforceable, invalid or illegal.

26. Successors and Assigns
This Agreement shall be binding upon and shall inure to the benefit of the successors in interest, executors, administrators and assigns of each Party to this Agreement. However, Consultant shall not assign or transfer by operation of law or otherwise any or all of its rights, burdens, duties or obligations without the prior written consent of City. Any attempted assignment without such consent shall be invalid and void.

27. Non-Waiver
None of the provisions of this Agreement shall be considered waived by either Party, unless such waiver is specifically specified in writing.

28. Time of Essence
Time is of the essence for each and every provision of this Agreement.

29. City's Right to Employ Other Consultants
City reserves its right to employ other consultants, including engineers, in connection with this Project or other projects.

30. Prohibited Interests
Consultant maintains and warrants that it has not employed nor retained any company or person, other than a bona fide employee working solely for Consultant, to solicit or secure this Agreement. Further, Consultant warrants that it has not paid nor has it agreed to pay any company or person, other than a bona fide employee working solely for Consultant, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement. For breach or violation of this warranty, City shall have the right to rescind this Agreement without liability. For the term of this Agreement, no director, official, officer or employee of City, during the term of his or her service with City, shall have any direct interest in this Agreement, or obtain any present or anticipated material benefit arising therefrom.
[SIGNATURES ON FOLLOWING PAGE]
11

SIGNATURE PAGE FOR PROFESSIONAL SERVICES AGREEMENT

BETWEEN CITY OF UPLAND

AND HDL COMPANIES
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.

CITY OF UPLAND HDL COMPANIES
or.
kir
By: elli
By: 1 ire.• :L BLAY
NAGER Its: President
Printed Name: Andrew Nickerson
g4:47) 4-
By:

Its: CFO
Printed Name: Richard Park
(Two Signatures of Corporate Officers
Required For Corporations)
ATTEST:

By.

KERI JOH ,

CITY CLERK
12

EXHIBIT A
Scope of Services and Schedule of Charges
13

City

PROPOSAL FOR CONTRACT BUSINESS LICENSESERVICES
June 6, 2022
HdP Companies
SUBMITTED BY CONTACT
HclL Companies Robert Gray
Corporate Office: Brea. CA T: 714. 79.5nnn
operations Center:Fresno,rA E: reray :hdlrompaneG_ror hclI corn panies.rom

TAF_ILF OF rONTFNTS

1. LETTER OF INTEREST 1

2. PROJECT UNDERSTANDING AND APPROACH 2
• PROPOSED METHODOLOGY

3. RELEVANT EXPERIENCE 9
• FIRM QUALIFICATIONS AND EXPERIENCE
• REFERENCES
• STAFF QUALIFICATIONS AND EXPERIENCE

4. PROPOSED CHANGES TO CONTRACT TEMPLATE . 12

5. COST PROPOSAL 13

6. APPENDIX -ACTIVITY REPORT 14
for
Proptheosal forty Contra
Uplanctd Business License Services
HdL© Companies Ci of

LETTER OF INTEREST
June 6,2022
City of Upland
460 N.Euclid Ave.

Upland,CA 91786
Electronic Submission to [email protected]
HdL Companies (HdL)is pleased to submit our proposal for Contract Business License Services.With almost 40 years of experience, HdL provides revenue enhancement and consulting services to local governments. Our firm serves over 600 cities,counties and special districts across the nation and has recovered more than $3 billion in revenue.

We use our expertise to analyze tax data to provide relevant insights to support your financial strategies.Our commitment to innovative solutions and quality customer service is valued by our clients, proven by our 99.6%client retention rate and the over 60 California municipalities who have switched to HdL from other service providers.

Our contact information is:

Robert Gray,Director of Tax and Fee Administration
HdL Companies
120 S. State College Blvd., Suite 200 Brea, CA 92821
Ph:714.879.5000 Website: www.hdlcompanies.co .

HdL offers the following advantages:
• Relevant,timely and ongoing staff support by a team with decades of direct experience in municipal finance and budgeting, economic development and maximization of revenues. • Technology-driven resources for data analysis and reporting capabilities, providing immediate and convenient access to the most up-to-date tax and fee information.
• Expertise,analysis,recaptured revenues, and precise budget forecasts to maximize your revenue streams. • Reliable continuity of service by a firm with stable employee ownership and a low staff turnover rate.

HdL is uniquely suited to deliver our high quality and full-service solutions to the City and its business community in the areas outlined in this proposal. HdL will provide unparalleled service, reporting, and analytics due to synergies between the various tax programs requested by the City. HdL will not be using any subcontractors for the project.

HdL agrees to perform the services in the City's RFP and commit to providing the City with the dedication time, personnel and resources needed for this project. We look forward to reviewing the proposal with you in more detail and demonstrate how HdL can continue to enhance Upland's bottom line. Please call if you have questions or need additional information. I can be reached at 714.879.5000 or by email at rray@hdlcompanies_com Sincerely,
Robert Gray
Director of Tax and Fee Administration
Proposal for Contract Business License SerR•ic__
HdL© Companies City of Upland1110

0 PROJECT UNDERSTHANDING AND APPROACH
INZIKEIMMIZEI.. dmilii=11.1 .M11
HdL has a unique understanding of the challenges our hundreds of clients face.The City of Upland faces many of those same challenges: decreased revenues as a result of the global pandemic, limited staff,and increased operational costs. HdL is positioned to offer the City relief,while providing a superior level of service.

The Business License Tax Administration Service provides a turnkey approach for local governments that need assistance with administering business license taxes.Our team of experts can manage all or parts of the business tax operations conducted by the City.When combined with the Compliance Management services, the City receives the benefit of increased revenues and superior customer service, while reducing internal costs and gaining efficiencies.

This "trifecta" of increasing city revenues and support to the business community, while simultaneously reducing costs, is becoming more and more difficult for cities to accomplish. Our programs are so successful in this endeavor, that most of our clients not only reduce costs, but actually see new revenues exceeding the cost of the program, resulting in the City receiving the contracted administration services effectively at no cost, The City has recognized that efficiency and level of service are improved by offering the business community an on-line platform for business licensing needs. HdL offers robust online solutions for managing compliance of municipal Business License Taxes and its related functions. We are ever mindful of the important role that customer service plays in the successful implementation of a compliance and revenue collection program.Therefore, HdL will make every effort to ensure that all communications with the City's business community are kept at a professional level, maintaining a careful balance between compliance, revenue collection, tactfulness. sensitivity, and taxpayer education. HdL also provides updates on trends and legislation that could impact the City's revenue streams.

HdL is the only firm which also provides tightly integrated local tax services as needed. including modernizing your municipal code and tax structure, discovery and audit services, and consulting services which encompass any circumstance which may be encountered in the realm of local government licensing and taxes.Our compliance services integrate closely with our software,providing an electronic remittance package which eliminates data entry.

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Proposal for Contract Business License Services
HdL© Companies i City of Upland 2 1

0 PROJECT UNDERSTANDINGANDAPPROACH

1. Business License Tax Administration
HdL's Business License Tax Administration Services include the following:

Data Migration Systems: HdL will transfer the City's existing databases from Central Square as they relate to business license tax into HdL's internal administration tools. HdL will maintain the data and provide access to or copies of data and reports at the City's request.While access to online systems will be available for the City to use at their discretion, the City will not be required to use or maintain any software in house for managing the business license registry.

Renewal Processing: All active business license accounts will receive a renewal notification within 45 days of the renewal period ending. Accounts will receive all applicable forms necessary to complete the renewal process.

Depending on City specific processes, renewals can be processed via mail, e-mail,telephone, and online.

New Account Processing: HdL will process any new business license applications and complete the new account registration process in a timely fashion and in accordance with City approved processes. HdL will also facilitate intra- city departmental approvals such as zoning, code compliance, fire inspection, and other regulatory related functions.

Using our online platform,approvals to other departments can be routed and approved via email and website access.

Depending on City specific processes, new accounts can be processed via mail,e-mail, telephone, and online.

Delinquent Account Processing: HdL will process and collect delinquent accounts through a series of City approved processing methods. This will include at minimum three follow up delinquent notices, including by mail, email, and telephone calls. Delinquent accounts will be collected with full penalties as allowed by the Municipal Code or through current City practices.

Delinquent account processing is included in HdL's standard administration program and accounts processed this way are not subjected to any additional fees.Accounts that remain non-compliant after the delinquent account process, will be processed through the City approved guidelines established in HdL's collections component of the Compliance Management Program.

On-dine /Web Services: HdL creates a unique City website which will serve as the starting point for all web-based activities.This City specific site is designed to look and feel like the City's own web pages and ensures a level of continuity between the business community, the City.and HdL.Alternatively,the City's existing website can be used as the launch point for all web-based activities,linking to the HdL managed functionality.

HdL's website offers a variety of online functions to service the business community. While most of the website is a self-service platform for the business community, HdL staff reviews each account processed online for accuracy and compliance with City guidelines and procedures. In addition to filing and paying for taxes,businesses can obtain copies of applications, general support and FAQs, schedule appointments, and request copies of their tax registration, all with the click of a button. Our on-line services underscore HdL's commitment to excellence in customer service and education by continually improving the registration and payment experience for the business community. Online functionality available to the business community includes:

Submission of a new application
• Renewal of existing account
• Closure request
• Pay a balance due
• Update account information
• Print Certificate
• Public record inquiries
Proposal for Contract Business License Servi._
HdL© Companies City of Upland

0 PROJECT UNDERSTA►NDINCA►NDA►PPROA►CH
Payment Posting/Processing: HdL will process all payments received in an expedited manner. License accounts will be updated daily with payment information and revenues to be disbursed to the City net applicable fees at an interval to be agreed to during the project planning phase. Disbursements typically occur monthly but can be remitted as often as weekly depending on volumes and City needs. HdL's payment acceptance process accepts the following payment types:
• Check/Money Order/Cashier's Check
• E-Check
• Debit Cards
• Credit Cards(Visa,Mastercard,Discover,and American Express) • Check by Phone
HdL currently utilizes a standard payment gateway provider for on-line payment acceptance. HdL will work with the City to determine which provider, rate structures,and card types meet the City's needs. HdL can also utilize the same provider and process used by the City's current on-line functionality for an additional set-up fee.

Business Support Center: HdL provides businesses with multiple support options for registering, renewing, making payments and for general inquiries. A local, city specific number will be provided to businesses to access one of our tax specialists, Monday-Friday 8:00am to 5:00pm Pacific. Businesses will also have access to support via e-mail,fax, and via the Business Support Center On-Line. HdL constantly monitors quality control points to ensure courteous customer service, minimal hold times(under 90 seconds), and the return of voice messages the same business day.

Client Support: Each service HdL provides has our clients' needs at the forefront of our deliverables. Our client support team stands with the City from the contracting phase and every step of the way thereafter.Whether our clients reach out to our support team by email or phone, clients can expect immediate and professional responses to all inquiries. Dedicated client support representatives assist our clients with a variety of needs, including budget and forecast support, taxpayer dispute resolution, and general business tax inquiries.

Reporting: HdL provides a variety of standard reports monthly during our remittance processes. However, each client has unique ongoing reporting needs and can require a variety of ad-hoc requests from across City divisions.

All report requests are processed and delivered to the City at no additional charge.Report requests can be delivered in formalized reporting formats or can be detailed data driven spreadsheets.

In addition to requesting reports from our client Support team, the City has access to a variety of web-based services to run reports and make selective account inquiries. Our management portal provides a number of preset reports the City can run on real-time data.Custom reports can also be added to the portal for future needs. Detailed account lookup features are also available, should the city need information about a specific business.

Ancillary Services: Business license tax departments can be relied upon by the City to accomplish many non- related tasks. Recently, the new state laws have also burdened cities with additional process requirements that rely on business license tax departments to take on unrelated work. HdL assists cities with several ancillary programs including keeping up with new legislation and assisting other City departments with their requests.Ancillary services provided as a part of the program include but are not limited to:
• S61186 state fee collection, remittance,and reporting • SB205 (Storm Water)compliance and monitoring
• Collection of additional fees(Improvement Districts, Fire Inspection, Zoning, Etc.) • Community outreach and information campaigns
• AB 2184(Privacy Rights) service of process configurations, public search modifications, and personal information security
Proposal for Contract Business License Services
HdL© Companies `ty.of Upland
11,

0 PROJECT UNDERSTA►NDINGA►NDAPPROACH

2. Business License Tax Discovery/Compliance and Auditing Services HdL offers the most complete solutions for managing compliance of municipal Business License Tax including for Discovery, Audit, and Collections of various locally administered taxes.When selecting HdL, the City will benefit from the depth and breadth of municipal experience from a team of experts that work together with the City every step of the way.

The HdL Business License Discovery and Audit program's general scope of services is as follows:

Business License Tax Discovery
Enriched Data Portfolio/Lead Identification: Utilizing data provided by the City,as well as the HdL Enriched Data Portfolio(EDP).HdL's team builds an enhanced listing of entities subjected to licensure or taxation including, but not limited to, those businesses physically located in the City, itinerant businesses, and entities participating in the sharing economy such as short-term rentals(STRs),drive sharing services and others. HdL's data portfolio pulls from hundreds of sources such as internal sales and property tax databases.CDTFA and Franchise Tax Board lists,Secretary of State _ listings, local publications, international web-based publications, as i f well as locally administered business and tax databases letting the City capture every penny that is fair and equitably due to you. "f Field Surveys: Experienced field crews, equipped with the most Co*'j DG advanced tools available (mobile mapping/GPS systems, tablet r - -- computers pre-loaded with various City and state-wide databases, ,g « etc.) may canvass commercial areas of the City to develop and vre are enhance the leads identified in the EDP. Field Surveys provide additional inventories of active businesses as well as to provide on- 0/2ed �, site verifications of data culled from other sources.

Exception Resolution: Records are reviewed by our skilled team GIs members,filtering out records that may lead to erroneous contacts. it This extra step allows staff to find additional revenues not otherwise • identifiable through electronic means and assists in reducing potential complaints levied at City staff and management from pursuit of false positives.

Compliance Communication and Outreach: Upon exception resolution, HdL staff initiates contact with the identified entities through a series of City approved communication methods. HdL makes every effort to simplify the process for taxpayers and utilizes a variety of mediums for communication including mail, telephone, email and web-site access.Potential non-compliant entities are notified of their options to comply or dispute their non- compliant status.

Initial notification packets include everything a business needs to become compliant and multiple methods of resolving their accounts.

Proposal for Contract Business License Services
HdL© Companies City of Upland

0 PROJECT UNDERSTANDING AND APPROACH
Compliance and Auditing Services
Analysis and Selection: Audit candidates are selected using a variety of selection methodologies developed by our audit team with decades of business license tax audit experience. Preliminary analysis reports on each business selected are shared with the City prior to moving through the audit phases.

Audit Notification and Scheduling: Businesses selected by HdL and approved by the City are sent a letter notifying them of a scheduled Compliance Analysis Audit. Every effort is made to promote a positive experience for the taxpayer.A detailed description of the requirements and relevant documentation required for the audit is provided to the business two weeks in advance of the proposed audit date. If the business is unable meet the audit date selected by the City,all efforts to reschedule the audit to a more accommodating date will be made. Businesses are also afforded the opportunity to schedule flexible appointment times by contacting the Business Support Center or visiting our online support center.

Compliance Analysis and Audit: The HdL audit team will audit the financial records of the business to determine compliance with business tax regulations. HdL validates taxing variables such as gross receipts and other relevant information for determining compliance. In addition to identifying underreporting issues,the HdL Audit Program will also focus on other compliance related issues such as assuring correct classifications, multiple location allocation, apportionment issues,and identifying business to business relationships that may create tax liability for third parties.

Audit and Compliance Report: Upon completion of the audit and analysis, and prior to additional actions, a compliance report will be generated and reviewed with the City.The report will indicate specific results of the review and recommended future actions. Documentation that substantiates the findings in the report will be included with the report to assist the City and HdL in determining next step of the process.

Deficiency and Commendation Notification: Upon final review of the audit and analysis report, businesses that are found to have deficiencies will be notified of the findings as well as the payment and appeal processes. HdL will also work with businesses found to be -
deficient to explain the current findings and educate taxpayers on proper future filing procedures to prevent future errors and deficiencies. Businesses found to be in compliance, will be sent a commendation letter thanking them for - their compliance.

Invoicing and Collections: Business found to be underreporting are 'VW" invoiced through the standard City approved collections process. Balances are collected and remitted along with supporting documentation to the City through the approved remittance processes.
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Proposal for Contract Business License Services
HdL© Companies City of Upland 6

0 PROJECT UNDERSTANDING A►ND A►PPROA►CH
Proposed Work Schedule and Timeline
Event HdI_ client
Contract signed and received by HdL ✓ /
DISCOVERY - STAGE 1 (1-2 weeks) ✓ ✓
Conference Call-HdL Sales, PM,IT, Client Stakeholders - Review contract, special ✓ ✓ conditions/programming
Client to provide forms,ordinances, fee resolutions, business rules,logo(s), users authority, payment ✓ ✓ gateway.Provide contact info for client stakeholder and walk-through business license process.

Send sample letters to Client. Provide list of all information required by HdL. Provide contact info for HdL stakeholders. ✓
Provide client IT with FTP account information, instructions for sending data ✓ Upload client data to FTP server.(SQL or Access)Send screenshots (all screens for variety of account types) ✓
PROJECT KICK OFF A►ND SET UP - STAGE 2 (3-4 weeks) ✓ ✓ Project kick off conference call ✓ ✓
Begin data conversion ✓
Project Manager build tables,fee,messages,etc. ✓ Reports,forms and letters requested/development/review/edit/approval ✓ Project Manager test approval with forms ✓ HdL Tech and Project Manager review and test 1st conversion ✓ Send city the preview version of Prime (screenshots) ✓ Client to confirm user permissions ✓
Client to confirm Approvals process ✓
CO LIVE - STAGE 3 (1-2 weeks) --
Sign-off on conversion fee calculation — ✓ Run script in client's live database for new renewal cycles l ✓_
Proposal for Contract Business License Services
HdL© C o m pa n i e s City of Uplandfb

8 PROJECT UNDERSTANDING AND APPROACH
Staff Assignments
Staff Task
Director Business registration process development Client Advisor Sales and project scope
Implementation Project manager
Consultant
Client Onboarding Communication liaison with client Developer Oversees data conversion
Reports Designer Development of reporting
Systems Technician IT liaison
Remittance Manager Monthly Financial Remittances Tax Specialists New business registration, Renewal Processing Customer Support Operations Manager Customer Support
Proposal for Contract Business License Services
HdL© Companies City of Upland

0 RELEVANT EXPERIENCE

FIRM HISTORY
HdL© Companies Hinderliter, de Llamas and Associates(HdL)was established in 1983 to maximize local government revenues by providing allocation audits, analytical services,and software products to local governments.The firm,which is a 100%employee-owned company, provides audit and consulting services for sales, use and transaction taxes,cannabis taxes and other locally administered taxes. HdL developed California's first 1983 computerized sales tax management program and was responsible for securing legislation (AB 1611)that allowed independent verification of state allocations. HdL Software was formed in 1996 to provide innovative software processing tools for business licensing, transient occupancy taxes and other locally administered revenues.

HdL's systematic and coordinated approach to revenue management, tax administration and economic data analysis is currently being utilized by over 500 agencies in eleven states.

Currently partnering with over 220 cities and counties in California for services including business license tax/registration,transient occupancy tax,cannabis tax, and short-term rentals. HdL processes hundreds of millions in revenue annually from locally collected taxes.

FIRM OI IALIFICATIONS
HdL maintains the largest privately held sales,property, and business tax databases in California.The firm constantly improves and enhances the California Department of Tax and Fee Administration(CDTFA)raw registration data by correcting addresses and business names, differentiating brick and mortar retailers from business to business and online taxpayers and adding new business classifications to better identify emerging trends and economic opportunities. This highly enhanced database serves as the base for identifying emerging economic trends and developing budget projections that take those trends into account.

The database also includes continually updated registration data for every seller in California. allocation data for 502 of the state's 538 agencies and 239 transactions tax districts, business license data for over 700,000 businesses, property tax data for every jurisdiction in the 38 largest counties. a constantly updated automated telephone directory for all of California and thousands of business contacts developed through three decades of audit and business development activity.

To date, HdL has recovered more than $3 billion in revenue for client agencies. HdL is the leading provider of local tax revenue administration services and compliance in California. Currently partnering with over 220 cities and counties in California for services including business license tax/registration,transient occupancy tax,cannabis tax, and short-term rentals, HdL processes over hundreds of millions in revenue annually from locally collected taxes. 13roposaifor Contract Business License Services
HdL© Corn pa n ies City of Upland 9

3 : RELEVANT EXPERIENCE
} HdL is a Corporate Partner of the League of California Cities and California State Association of Counties and works LOCALGOVERNMFNTS extensively with the State Association of County Auditors.

AND California Societyof Municipal Finance Officers(CSMFO)and SPECIAI DISTRICTS FOR OVFR California Municipal Revenue and Tax Association (CMRTA) 40 YEARS on anticipation and planning of programs to strengthen local government revenues, and monitoring of legislative actions which impact local governments,
1 0 0 O This close understanding of local government needs coupled O with extensive datahaces and advance methodology provides for the most relevant, productive and responsive, revenue recovery, forecasting and economic services available.

LEAGUE CALIFORNIA (iti(
OF CAI IFORNI.a SOCIETYOIMUNICIPAL
CITIES" FINANCE OFFICERS
csMFo CMRTA
RFFFRF_NCFS
City of West Covina - Business License Services Client Since 1998 Paulina Morales,Assistant City Manager,626.939.8401,pmorales@westcovina,org 1444W. Garvey Avenue South I West Covina, CA 91790
HdL currently provides business license administration and compliance services and transient occupancy tax services.

City of Lancaster- Business License Services Client Since 2019 George Harris,Finance Director, 661.723.6000,[email protected] 44933 N. Fern Ave.. Lancaster,CA 90712
HdL currently provides business license administration, discovery and compliance services and transient occupancy tax services.

City of Vallejo- Business License Services Client Since 2020 Rekha Nayar.Finance Director, 707.648 4527 rekha.nayar@cityofvalleio,net 555 Santa Clara Street,Vallejo, CA 94590
HdL currently provides business license administration, discovery and compliance services and transient occupancy tax services.

Proposal for Contract Business License Services
HdL© Companies City of Upland 10

RELEVANT EXPERIENCE

STAFF OLIALIFICATIONS AND F-XPERIFNCF
Business License Tax Analysis Team
HdL's key staff has extensive local government experience, having previously held positions in city management, finance, planning, economic development, and revenue collection. The HdL team includes several experienced business license tax department supervisors, certified revenue officers (CROs).and prior CMRTA board members .o.ert gray— Direr or o ax 3n. e - ..ministration ._o utions Mr.Gray serves as Director of Tax pt Fee Administration and has been with the firm since 1996. ' has extensive experience in the design, development, implementation and support of local tax software systems for local government. He has played a key role in the design of 8 municipal softwl systems and approximately 275 sirrrecefnl implementations of those systems.He introrirrred Hd, local tax services, which provide tax administration and consulting services to an ever growin,,, number of municipalities. While leading HdL's Tax Pt Fee Administration team through a period of significant growth, he has ensured that the team maintains its commitment to providing excellent customer service. He also oversees software development and IT as HdL's CIO. He earned a Bachelor of Science degree in Com.uter S i- c- .nd . n MBA from Azusa Pacific I Iniversity„
Joshua Davis -Associate Director of Tax and Fee Administration ilk Mr, Davis has over 20 years of experience with local tax administration,discovery, and audit, and oversees a skilled team which provides the most sophisticated local tax administration services available to California municipalities. Trained in revenue audit and discovery techniques, he is skilled in navigating the complex scenarios and needs often encountered during such services.He also possesses strong technical and business process capabilities which he employs to aid HdL clients in meeting their strategic objectives. Prior to joining HdL, he was employed as a compliance service manager at a government services firm. His reputation amongst municipalities is that of a very capable local taxation expert who will help the municipality achieve their objectives while providing excellent customer service throughout the engagement.

Notable projects he has managed include a long term and broad engagement supporting the City of Beverly Hills business tax team and administering business tax for the City of Roseville.All services provided through Mr.Davis's team enable municipalities to administer their tax programs more effectively,through both efficient operations and increased discovery and collection of tax due.
•
' Connor 1 uc wor.' - ien. - _viso
fi' Mr. Duckworth has over ten years of experience working for both State and local municipalities and providing political consulting to candidates on a number of races and referendums. As a project', k _ manager, he is responsible for the development and implementation of business license, tax. and revenue related products and services. He has served as a lecturer and mentor to municipalities nationwide and served as a Vice-President on both Division and State Boards for the CMRTA. He has won the CMR - Lighthouse Award of excellence for creating the top business license and revenue program in the State. Additionally. ►I- I i. .-t■ # s . ■ • , ,.• • : . r R t e - , _ - ' edthe need ove- .•• 1.,22 -- 'r-- Proposal for Contract Business License 5
HdL© Companies City of Upland illi

4 I REQUESTED CHANGESTO CONTRACT
HdL will request modifications to the indemnity/liability limitation language.

Also, if awarded the contract, HdL requests the following language be added if agreeable to the City:

Client acknowledges and agrees that any other public agency (including, without limitation, any participating government agency) located within or outside on the State(e.g., city, municipality, county, district, public authority or other political subdivision) may procure services nor trees and other terms and conditions that are substantially similar to any on the Services, Fees and other terms and conditions set north in this Agreement, provided that such other public agency executes a separate agreement with Consultant wherein the services rendered to such other public agency, the trees payable by such other public agency, and the other terms and conditions on such separate agreement are the responsibility on Consultant and such other public agency and not Client.

Proposal for Contract Business License Services
HdL© Companies City of Upland

COST PROPOSAL

1. Business License Tax Administration
The fee for this service is $16* per processed account, which is any account for which an application or renewal/ return was processed, or active account which was sent a renewal notice.

CPI increase applied annually

2. Compliance Services -Business License Tax Discovery and Audit The fee for discovery and audit services is 40%of the revenues and 25%of the collections received as a result of the service.

Discounts
Hdl understands the City has an active enforcement program and realizes the two programs may overlap with each other. As such, accounts worked by both the City and HdL will result in the standard fee discounted by 50%.

3. Hourly Rates
Additional services beyond the scope of services in this proposal are priced separately depending on the complexity of the tasks involved. Such fees can either by fixed or time and materials.Our currently hourly rates are listed below.

Hourly Rate
Principal $325
Programmer $295
Senior Analyst $245
Analyst $195
Proposal for Contract Business License Services
HdL© Companies City of Upland

APPENDIX
Activity report for current services follows this page.

HdL© Companies
Proposal for Contract Business License Services
City of Upland 14

4 OC tip"
A „,,....-Art.._,,,,, r.t.
i.„ , ....i.
'NEIEMPr Se
C • Ly o
Upland
Business Tax
Operation Management
Service Review
April 22, 2021
HdL Com pa
SUBMITTED BY CONTACT
HdL Companies Josh Davis
12n S. State College Blvd.. Ste 200 T:(71.4)^79-1:innn Ext. 3113 Eirea, CA 92021 E; jdavis@hdlcompanies com
hdlcompanies.Com

Table of Contents
Introduction 2
Investment in Services 2
Recent Events 2
Operation Management 4
Business Demographics in Brief 5
New Businesses - Application and Reinstatement 6 Annual Business License Renewal 6
Parking Business Improvement Area(PBIA) 7 Business Support Center 8
Phone Calls and E-mails 8
Web Processing 9
Hard Copy Mail 9
Client Support Team 10
Remittance Support, 10
Custom Reports 11
Conclusion 11
Page

Introduction
This report provides an overview of the services HdL has provided to the City of Upland for Business Tax Operation Management since launching our Operations Management Service on May 28,2014. The report also summarizes specific projects that HdL and the City have completed during last five years.

Investment in Services
As your administrator,we have stewarded $6.348.806 in Business Tax since 2016. We have done this with flexible staffing that meets your highly variable demand. For example, in January, peak call volume alone can exceed 80 phone calls per day, far exceeding the capacity of a single resource.By shifting resources,we were able to handle all of those calls within our agreed upon SLA,ensuring no businesses were waiting for assistance.

At the same time with our flexible service,we were able to handle 600 to 700 e-mails during peak demand within a few business days,rather the weeks itwouldtake for a staff of 1 to 2 FTEs." (Please see the section titled Support Center" where you will find key success metrics and the volume of licensingoctivities.) The average annual cost of services has been approximately $85,000 for Business License Operation Management-or typically around 5%of total revenues.

As result of HdL's Discovery and Compliance Services,our team has identified and worked with the City to collect $910,032 in additional Business License Revenue that otherwise would have not been collected by the City. If one were to offsetthe cost of operation management services with recoveries from the Discovery and Collection programs,the return to the City has been more than$500K since the start of service,in other words,the rate of return is 210%on investment. Another way to view this is that HdL not only performed business license services for the City at no charge,but paid the City to do so,as the net cost of our operations service was-$500.000.

Recent Events
HdL has worked hand-in-hand with the City on everything from regular e-mail blasts to custom reports to coordinating last minute renewal changes due to state legislation. Due to HdL's,large client base,we are able to gain efficiencies from the management of over 100 unique license and tax programs. As an HdL client the City has saved an estimated $70K in custom software modifications, report development and other process enhancement related fees incurred by other cities that need to make changes to adapt to new legislation.

State of CaliforniaA62184-Immigrant Business Inclusion Act:

HdL implemented a series of software upgrades and process enhancements for the new state law that became effective on January 1.2019.The bill required the removal of any section of the business license application exclusively requiring a social security number, Instead,a business license application must provide a means for accepting alternative forms of identification, including a California driver's license, identification number,or an individual taxpayer identification number(ITIN).The bill also allowed for the applicant to provide an address where the individual consents to receive service of process and would require a jurisdiction to accept a post office box or private mailbox that meets those requirements.

State of California SB234-Family Daycare Homes:

HdL adjusted the business license process for residential based daycare facilities for the new state law that became effective on September 5.2019. The new law required a large family daycare home with up to 14 children to be treated as a residential use of property. The bill also prohibited a local jurisdiction from imposing a business license,fee,or tax for the privilege of operating a small to large family daycare home.

Page

State of California S6205 -Stormwater Discharge Compliance:
• HdL implemented processes and procedures for the new state law that became effective on January 1, 2020.The bill mandates that local government agencies ensure that businesses regulated by the State Water Resource Board(SWRB)follow the NPDES permit program as part ofthe agency's business license process, for both applications and renewals. HdL has put in place several software and process modifications to accommodate the new legislation that utilizes SIC codes to indicate which businesses are required to demonstrate compliance. In general, HdL has been handling all business license tax requirements as they relate to this bill for the City of Upland.

COVID-19 Pandemic:

The pandemic and resulting global public health challenges this year have had a major impact on local governments and the State of California. HdL has worked closelywith the City of Upland to implement a series of process changes and outreach programs to the business community during this tumultuous time.

New Business Approval Process-Effective February 2021
• As of February 2021,the City of Upland implemented a "New Business"process whereby business must first receive an approval from the Zoning Department in order to conduct business in the City. Once a new business has received approval from Zoning, a business license application with City approval documentation is submitted to HdL to complete the remainder of the process. Our team worked with the City to implement this change for this renewal season.

Operation Management
Over the last five years, HdL has processed approximately 21,650 renewals and 5,400 new applications and stewarded over$7 4 million in business taxes.The charts below show the BusinessTax received for 2016through 2020 and the count of business license for 2016 through 2021 filing periods.While there has been a decline in 4th Quarter business renewals as of 2020, mid-year renewals remain strong. Furthermore,the City's 2020 Business Tax Revenue appears to be in line with the City's steady and continuous growth.

YTY Business Tax Revenue Collection
Based on Payment Date
$1,750,000
$1,500,000
$1,250,000
$1,000,000
$750,000II II
$500,000
$250,000
944,51 1247,1 9 $ ,1�42,7c�7 $1,334.802 $1,353,937 $1,430,000 $0
2016 2017 2018 2019 2020 2021
Historical Business Market Trend
Based on Expiration Date
3,500
3,000
aa)

2.500
2,000
° 1,500
§ 1,000
500
0 2016 2017 2018 2019 2020 2021
License Expiration
Jun Filers Dec Filers
Page

Business Demographics in Brief
For businesses with a license expiration date of 2021,there are 3,687 businesses inside the City of Upland and 1,288 that are based outside the City. In the comparison below,local businesses contribute notonly the majority of businesses tax but hold a slightly greater tax burden.

Percentage of Business Based Business Tax&Fees Percentage Inside During 2021 for Period Ending 2021
74% 26% 83% 17%
•
!Inside Ur Outside •Inside •Outside
Percentage of Revenue Contribution from Inside Businesses By Expiration Dote 2019 - 2021
[34
General Businesses
s 31%
31%1
26%I,
Service Businesses ,,, "R`" •"'°29%
.S.
28% .
7%I
Professionals eigN7%
7%
6%
Commercial Rentals E ,6% 3
7%
®6%I
Contractors j 6%
6%
4% I
Residential Rentals 4%
4%
0% 5% 10% 15% 20% 25% 30% 35% 40% ■2021 •2020 r 2019
ategories used in the chart above were simplified to assist with graphic representation of the overall figures.

Page

New Businesses -Application and Reinstatement
The City of Upland has an average of approximately 1,200 new applications and reinstatements annually and retains an average of 45%of new businesses after their firstyear of business.New business applications and first renewals saw a dramatic decrease for periods ending 2020/2021 because of COlVD-19.

Applied/ Period Fnding
Reinstated 2016 2017 2018 2019 , 2020 2021(YTD) Inside 652 595 595 648 439 381 Outside 625 704 704 659 344 380 Totals 1,377 1,299 1,299 1,307 783 761 Annual Business License Renewal
On average,HdL sends 5,350 renewal notices in a year to active businesses registered with the City of Upland.

Each business notified receives all the necessary forms and instructions required to complete the renewal process.

Notices Sent -
Period inning 2016 2017 20.18 2019 2020
June Filers 2,411 2,334 2,303 2,385 2.186 December Filers 2,920 2,869 3.105 3,285 2,958 _ This year for business renewing their license in January 2021 HdL sent a reminder by mail ahead of the renewal form to direct more businesses to the online portal.As a result,December 2020 saw a boost in online renewals.

The summary shows the number of renewals received based on timeframe in which they were submitted and the number of corresponding online renewals.

Renewal Status Renewal Online
Periods Ending Count Inside Outside Renewal 2016 Totals 4.126 3,245 881 1,279
2017 Totals 4,230 3,355 875 1,267
2018 Totals 4,312 3,386 926 2,538
2019 Totals 4,385 3.434 951 2,800
2020 Totals 4,468 3,492 976 2,941
2021 Totals _ 4,253 3,348 905 3503
Grand Total 21,648 17,015 4.633 13.049 Page

Parking Business Improvement Area (PBIA)
In addition to Business Tax,Ha also administers and collects the Parking Business Improvement Area (PBIA) fees for approximately 300 businesses in the Downtown area of Upland. Below is a summary of the number of businesses by zone and class type.

PBIA Zones Business Count PBIA Revenue
2021 2021
Zone A,Class A 1.4 $2,193
Zone A.Class B 57 $9,850
Zone A.Class C 116 $37,693
Zone A,Class D 9 $2.311
Zone A, Exempt/$0 Fee 26 $0
Zone B,Class A 2 $243
Zone B,Class B 31 $3,050
Zone B.Class C 32 $5,563
Zone B.Class D 2 $1,281
Zone B,Exempt/$0 Fee 6 $0
Totals 295 $62,183
Average Percentage of PBIA Revenue By Zone
By Expiration Dote
Zone A Zone B
Page

Business Support Center
HdL's Business Support Center provides direct access to tax specialists for the City's businesses to ensure prompt and efficient service. Tax specialist are available by phone, e-mail,by web, or by post mail providing multiple means of registering,renewal,making payment or answering business license related questions.

The following chart shows the annual workload hours by media categories.

Annual Workload Hours by Category
484:51:00 F 425:05:00 196:11:00 133:24:12 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
■Phone Calls •Emails ■Web Processing •Hard Copy Mail
Phone Calls and E-mails
HdL's phone and e-mail system is designed to help business owners reach tax specialists who can best assist them with their specific situation while reducing wait times. Data is collected and analyzed to continuously improve our responsiveness.

Avg.Phone Call Talk Times
Businesses have wait times of 30- 60 seconds. Less than 60sec 14/0
Most calls take 5 to 10 minutes from start to
finish. Primary calls are questions about their
business license or contractors obtaining 10+
minutes
business license. 11% 1 to
Phone Calls Total — minutes
50%,
2020 Q1 2.366 5 to 1n
mini tec
2020 Q2 1,229 25%
2020 Q3 1,664
2020 Q4 1,850 • Less than 60 sec • 1 to 5 minutes 2021 Q1 1,308 ■ 5 to 10 minutes 10+minutes The majority of e-mails are answered within 2 - Avg.Email Processing Times 3 business days.The majority of e-mails
received for businesses are providing _-
additional information which allow tax 5.010
Minutes
specialists to finalize business application and 11% renewals.

Less Than 5
Emails Total Minutes
2020 01 1,350 ^n%
10+
2020 Q2 85.4 Minutes
9%
2020 03 961
2020 Q4 1,627 • Less Than 5 Minutes 5 to 10 Minutes 2021 Q1 1,583 a 10+Minutes

Web Processing
HdL's online filing system allows businesses to instantly submit business license renewals and new applications, address balances on accounts, or report the closure of their business. An increasing number of the City's businesses file online. We send an e-mail notification to the business when the renewal has been received and then either email or post the certificate to the business.

Web Renewals Web ApTrations
4,000 1000
3,000 800
600
2,000
400 fi
1,000
0 I I I 2000
co m tio 0 � a m` a m ? 1 rj} t; 8 a"i 1- a 2 a H o z LL g a g a o z 2019 2020 2021 2019 MI 2020 J 2021
Web Payments/(Outstanding Balances)
1000 200
800 150
600
100
400
50 200
1 1
0 # 0
s tom' $ a"i - LL '° a - ¢ t; z LL a
a g o Z o g < ,n o
2019 M 2020 ■2021 „;,2019 al 2020 t:i 2021
Hard COPY Mail
On average,the City receives 170 pieces of mail monthly. 63%percent of those are payments and renewals and 12%are new applications,closures,and supporting documentation.

Distribution of Hard Copy Mail
•Application/Closures/Misc
■ Renewals/Payments
56%
18%
• Return Mail
Page

Client Support Team
HdL's Client Support Team has closely working with the City of Upland since May 2014. Since the launch, our Client Support Team has built and fostered relationships to troubleshoot or aid in changes the City has implemented. HdL sends remittance and custom reports to City staff on a monthly basis in addition to ad hoc reports. Also.HdL collects and remits SB-1186 funds to the State quarterly and prepares quarterly and annual report filings to State.

Remittance Support
The table below shows business tax and fees collected in Calendar Year(CY)2019 and CY 2020.

Remittance Payment Information CY 2019
Business Tax- Employee Based $82,453.79 $84,019.13 Business Tax- Flat Fee $8,362.09 $6,145.85
Business Tax - Gross Receipts Based $1.014555.40 $990,715.34 Business Tax- Unit Based $43,790.08 $44,487.41 Business Tax- Penalties $185,640.70 $114,280.31 Special Fees - Bingo $50.00 $50.00
PBID- Zone A $62,235.98 $46,859.80
PBID- Zone B $12,628.08 $9,980.46
New License Application Fee $17,719.00 $14,550.20 Non-Profit Processing Fee $2.00 ($1.00)
Address Amended Fee $2.00 $5,550.90
Badge Permit Fee $22.00 $22.00
Planning g Zoning Fee $49,327.65 $73,769.80
SB-1186 Fees-City Portion $20,504.10 $21,372.50 SB-1186 Fees-State Portion $2,336.90 $2,382.50
Banking Fees $245.00 $146.70
Other ($75.60) $1.00
Grand Total $1,499,799.17 $1,414,332.90
The following charts show the revenue from and count of transactions by payment method:

Revenue By Transactions Count of Transactions
$750.000 3.500
$625,000 3.000
$500,000 2.500
$375.000 2`000
$250,000 1.500

1.000
$125.000 500
I
$0 0
Credit.Card Check eCheck Credit Card Check eCheck 2019 2020 fg 2019 *2021

Custom Reports
The City regularly requests custom reports from HdL's Client Support Team. We have provided reports for the the finance department, economic development, PBIA,and other City departments on a weekly,monthly,and annual basis. Below are some of the more common reports that are generated for the City on a reoccurring basis. • New Business Reports-Weekly and Monthly.
• Top Employee Counts - Requested by Economic Development. • PBID Reports - Reoccurring listing of active businesses in the downtown area. • Essential Businesses- Reports generated in response to COVID-19. • Public Records Request-Ad hoc reports requested by the community. • NPDES Business Report- Report generated in response to SB 205. • "In-City"Active Business Reports -City requested reports focusing on specific business sectors such as salons,restaurants,tobacco shops,and others.

Conclusion
HdL has provided the City with services thatare geared towards adding va I ue and a!lowing operationa I flexibility.

HdL's Business Support Center serves the business community with efficiency and care while HdL's Client Support Team provides white glove financial,operational,analytical reports as well as collaborating on solutions to external events. HdL looks forward to furthering our partnership with the City of Upland.

Page

EXHIBIT B
Tax and Fee Administration Services and Fees
Business License Tax and Fees
City of Upland,CA
EXHIBIT B — This EXHIBIT B provides the scope of Services and Fees for tax and fee administration related to business license tax and fees pursuant to the Master Services Agreement dated September 12,2022 ("MSA").

The MSA includes the main body of the MSA,this Schedule,and all other Schedules to the MSA. Terms not otherwise defined herein have the defmitions given to them within the main body of the MSA.

SCOPE OF SERVICES
Consultant will provide the following Services relative to Client's business license tax administration.

1. Operations Management Services

1.1. Establish and maintain database of Client businesses.

1.2. Receive and process applications,renewals and payments in a timely fashion.

1.3. Send renewal notices to active businesses within 30 days of the renewal period end date or at another interval specified by Client.

1.4. Provide businesses multiple options for submitting applications, renewals, payments, or support requests (including via website, email, mail, phone, and fax. Consultant license specialists will be available for live interactions Monday through Friday, 8:00am to 5:00pm Pacific).

1.5. Remit revenue to Client no less than monthly.

1.6. Provide Client staff access to website portal offering business registry inquiry, reporting, and electronic department approval capabilities.

2. Compliance Services: 1) Identify and register businesses which are subject to licensure or taxation, 2) collect known debt as pertains to business license or tax,and 3)identify under-reported tax liability.

2.1. Discovery Services

2.1.1.Develop a list of businesses subject to Client licensure or taxation.

2.1.2.Notify non-compliant businesses of their options to comply or dispute their non-compliant status.

Notification and support to businesses will be facilitated through the website,mail,email,phone and fax.

2.1.3.Review information and forms submitted by the business for completion and accuracy,inclusive of any additional required documentation (i.e. home occupation permit). All submissions are filed and stored electronically and made available to Client upon request.

2.1.4.Provide businesses with detailed invoicing and options to pay via website,mail,and phone.

2.1.5.Remit revenue to Client no less than monthly, along with all business applications and any additional documentation.

2.2. Collection Services

2.2.1.Identify businesses subject to Client licensure or taxation which have known debt to Client and have failed to pay within an appropriate time frame.

2.2.2.Notify businesses of their options to comply or dispute their non-compliant status.

2.2.3.Provide businesses with detailed invoicing and options to pay via website,mail and phone.

2.2.4.Remit revenue to Client no less than monthly.

2.3. Audit Services

2.3.1. Identify potential under-reporting and/or misclassified businesses.

2.3.2.Audit businesses mutually agreed to by Client and Consultant that are identified as potential under-reporting businesses.

2.3.3.Submit audit summaries to Client and discuss further actions.

2.3.4.Educate businesses on proper reporting practices. 1211802.2 Page 1 of 3

EXHIBIT B
Tax and Fee Administration Services and Fees
Business License Tax and Fees
City of Upland,CA

2.3.5.Invoice and collect identified delinquencies.

3. Online Payment Processing—Consultant's services include PCI compliant payment processing services powered by FIS Global,which supports both credit card and eCheck transactions.

3.1. Client Responsibilities

3.1.1.As a condition to its receipt of the Service, Client shall execute and deliver any and all applications,agreements,certifications or other documents required by FIS Global,Networks or other third parties whose consent or approval is necessary for the processing of Transactions by FIS Global. "Network"is an entity or association that operates,under a common service mark, a system which permits participants to authorize, route, and settle Transactions among themselves, including, for example, networks operated by VISA USA and Mastercard, Inc., NYCE Corporation,American Express,and Discover.

3.1.2.Client hereby grants Consultant the full right,power and authority to request,receive and review any Data or records reflected in a Transaction report. Client represents and warrants that it has the full right and authority to grant these rights.

FEES

4. Operations Management Services

4.1. Fees for performing operations management Services shall be $16.00 for each processed account, which is any account for which an application or renewal/return was processed, or active account which was sent a renewal notice.

4.2. Fees will be increased as of January 1st of each calendar year with reference to the 12-month percent change in the most recently published annual Consumer Price Index for All Urban Consumers(CPI- U),West Region,as reported by the U.S.Bureau of Labor Statistics(the"CPI Change").Each annual increase in the Fees will be equal to the greater of two percent(2%)or the actual CPI Change and the lesser of ten percent(10%)or the actual CPI Change. For example,if the actual CPI Change is 1.5%, then the annual increase will be 2%, if the actual CPI Change is 3.5%,then the annual increase will be 3.5%,and if the actual CPI Change is 12%,then the annual increase will be 10%.

4.3. Fees related to travel and lodging expenses are billed at cost and apply to all meetings (including implementation,training,operations and support).Travel expenses only apply to out-of-scope travel and must therefore be pre-approved by Client.

4.4. Fees will be invoiced monthly to Client for Services performed during the prior month. Fees will be netted out of Client's monthly revenue disbursement.Client will submit payment for any balance due to Consultant within 30 days of receiving the invoice.

5. Compliance Services

5.1. Fees for performing compliance Services apply to all monies received for the current tax/license period and any other prior period collected (including monies received for taxes, penalties, interest, and fees). Note: Hdl understands the City has an active enforcement program and realizes the two programs may overlap with each other. As such, accounts worked by both the City and HdL will result in the standard fee discounted by 50%.

5.1.1.Fees for performing discovery Services shall be a contingency Fee of 40% of the revenues received as a result of the Services.

5.1.2.In the event that Client discovers a non-compliant business and reports the business to Consultant (including a calculation of all taxes/fees due), Consultant will categorize the business as a collection service effort and thus apply the lower collection Services contingency Fee rate. 1211802.2 Page 2 of 3

EXHIBIT B
Tax and Fee Administration Services and Fees
Business License Tax and Fees
City of Upland,CA

5.1.3.Fees for performing collection Services shall be a contingency Fee of 25% of the revenues received as a result of the Services.

5.1.4.Fees for performing audit Services shall be a contingency Fee of 40%of the revenues received as a result of the Services.

5.2. Consultant recognizes Client's authority to waive or reduce the tax/fee debt of a business. Should Client decide to do so for a business whose deficiency was identified by Consultant, Consultant shall be entitled to compensation in the amount of one half(1/2) of the Fees Consultant would have otherwise earned. Deficiencies which are uncollectable due to insolvency or dissolution of the business, or for deficiencies which are otherwise incapable of collection(i.e. statute of limitation or other legal defense)shall not be considered a Client voluntary election to waive,and thus,Consultant would not be entitled to compensation related thereto under this provision.

5.3. Fees related to travel and lodging expenses are billed at cost and applied to all meetings (including implementation,training,operations,and support).Travel expenses only apply to out-of-scope travel and must therefore be pre-approved by Client.

5.4. Fees will be invoiced monthly to Client for Services performed during the prior month. Fees will be netted out of Client's monthly revenue disbursement.Client will submit payment for any balance due to Consultant within 30 days of receiving the invoice.

6. Payment Processing—Consultant will configure payment processing services to utilize either a taxpayer funded model(convenience fee)or Client funded model,as directed by Client. Client may switch between these models upon written request to Consultant. Fees for each of these payment processing models are detailed here.

6.1. Taxpayer funded model — Client authorizes Consultant to collect each convenience fee from the taxpayer at time of payment.

6.1.1.Credit and debit card processing—2.9%of transaction amount,minimum of$2.00

6.1.2.ACH/eCheck processing-$1.25 per transaction

6.2. Client funded

6.2.1.Credit and debit card processing—2.9%of transaction amount

6.2.2.ACH/eCheck processing-$0.50 per transaction

6.3. Returned payments/NSF fee—Each occurrence of a card chargeback,returned payment or insufficient funds will incur a fee of$25.00,to be applied to the taxpayer's account.

6.4. Consultant reserves the right to review and adjust pricing related to payment processing services on an annual basis. Consultant will communicate any such adjustment to Client in writing,with 60 days advance notice. Items that will be considered in the review of fees may include, but are not limited to: regulatory changes, card association rate adjustments, card association category changes, bank/processor dues and assessments,average consumer payment amounts,card type utilization,and costs of service.
1211802.2 Page 3 of 3

Docusign Envelope ID:C68EFDC7-EFE1-8C21-81EF-0B4460F0B021 y44 or UPt
z. L9L
U CALIFORNIA LEVINE ACT DISCLOSURE STATEMENT
Oq �_,tQ�t�
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?
YES If yes, please identify the Council Member(s): _ ZNO

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):

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. a—Signed by:
6/2/2026 Qwd,vcw Mdaxsaln,
'-2 8393594812482..

Date Signature of authorized individual
Hinderliter de Llamas &Associates
Company/Applicant Name
(Levine Act definitions on reverse side)

Docusign Envelope ID:C68EFDC7-EFE1-8C21-81EF-0B4460F0B021

LEVINE ACT DISCLOSURE STATEMENT DEFINITIONS
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; FPPC Reg 18438.2(a) "proceedings" (2) Formally or informally requested by the party; or (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(a)(1) 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 Gov. Code 84308(a)(2) 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 Reg 18438.3 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 Reg Competitively Bid successful bidder refuses or fails to execute the 18438.2(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)(B) 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.

°F °p`q� CIoFUPLAND
.�, �` "The City of Gracious Living"
c�lrFOR�i� � 'C ! o - -
DATE: June 22,2026
TO: MAYOR AND CITY COUNCIL
FROM: MICHAEL BLAY,CITY MANAGER
PREPARED BY:STEPHEN PARKER,CPA,ASSISTANT CITY MANAGER

STACI SULLIVAN,FINANCE MANAGER
SUBJECT: CONSIDER APPROVAL OF THE FIRST AMENDMENT TO THE AGREEMENT WITH VAN

LANT&FANKHANEL,LLP FOR PROFESSIONAL AUDITING SERVICES
RECOMMENDED ACTION:

It is recommended that the City Council approve the First Amendment to the Agreement with Van Lant&Fankhanel, LLP for professional auditing services for one additional year through June 30,2027,covering the Fiscal Year 2025- 26 audit,in an amount not-to-exceed$41,000 for the extension period;and authorize the City Manager to execute the First Amendment.

GOAL STATEMENT
The proposed action supports the City's goal of providing services in a cost-effective manner.

BACKGROUND
On September May 8, 2023, the City Council approved an agreement with Van Lant&Fankhanel, LLP (VLF) for professional auditing services through June 30,2026,covering Fiscal Years 2022-23,2023-24 and 2024-25,with two mutual one-year additional terms and a not-to-exceed amount of$203,500.

ISSUES AND ANALYSIS
The City is required to have its annual financial statements audited by independent certified public accountants.

Following a competitive Request for Proposal (RFP)process in 2023, VLF was selected as the City's independent auditors. The Agreement was for three(3)years with two(2),one(1)year extensions.

VLF has agreed to provide the same services as described in the Original Agreement for a term ending June 30,2027, covering the audit for Fiscal Year 2025-26.

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
The cost for professional auditing services for Fiscal Year 2025-26 is $41,000. Sufficient funds are included as part of the Fiscal Year 2026-27—2027-28 biennial budget,Finance Contract Services Account No. 1011301-5252.

ALTERNATIVES
Provide alternative direction to staff.

CEQA:Not a Project.

AMENDMENT NO. 1 TO

AGREEMENT WITH VAN LANT & FANKHANEL, LLP

FOR PROFESSIONAL AUDITING SERVICES
This Amendment No. 1 to the Agreement for Professional Auditing Services is made and entered into as of June 22, 2026 ("Effective Date") by and between the City of Upland, a municipal corporation ("City") and Van Lant & Fankhanel, LLP, a Partnership of Certified Public Accountants ("Consultant"). City and Consultant are sometimes referred to herein individually as a "Party" and collectively as "Parties."

RECITALS
A. WHEREAS, the City and the Consultant have entered into an agreement, dated May 8, 2023, for the purpose of providing Professional Auditing Services (the "Original Agreement").

B. WHEREAS, the Parties now desire to amend the Original Agreement in order to extend the term for an additional term of one year for the period of July 1 , 2026 to June 30, 2027 for Fiscal Year 2025-26, and to include additional funds for the continued performance of the services in accordance with the compensation provisions of the Original Agreement.

NOW, THEREFORE, in consideration of the above recitals and the mutual covenants, conditions, and promises contained in this Amendment No. 1 and the Original Agreement, the Parties mutually agree as follows:

AGREEMENT

1. Incorporation of Recitals. The recitals listed above are true and correct and are hereby incorporated herein by this reference.

2. Term. The term of the Original Agreement shall be extended through June 30, 2027 unless earlier terminated.

3. Compensation. The compensation for services performed pursuant to this Amendment No. 1 shall not exceed Forty One Thousand Dollars $41 ,000, thereby increasing the total not to exceed compensation of the Original Agreement to the amount of One Hundred and Sixty Thousand Nine Hundred Dollars ($160,900). Work shall be performed at the rates set forth in the Original Agreement.

4. Full Force. Except as amended by this Amendment No. 1, all provisions of the Original Agreement, including without limitation the indemnity and insurance provisions, shall remain in full force and effect and shall govern the actions of the Parties under this Amendment No. 1.

5. Electronic Transmission. A manually signed copy of this Amendment No. 1 which is transmitted by facsimile, email or other means of electronic transmission shall -1-

be deemed to have the same legal effect as delivery of an original executed copy of this Amendment No. 1 for all purposes. This Amendment No. 1 may be signed using an electronic signature.

6. Counterparts. This Amendment No. 1 may be signed in counterparts, each of which shall constitute an original.
[SIGNATURES ON FOLLOWING PAGE]
-2-

SIGNATURE PAGE FOR
AMENDMENT NO. 1 TO AGREEMENT

WITH VAN LANT & FANKHANEL, LLP

FOR PROFESSIONAL AUDITING SERVICES
IN WITNESS WHEREOF, the Parties hereto have executed this Amendment No. 1 on the Effective Date first herein above written.

CITY OF UPLAND CONSULTANT
APPROVED BY: VAN LANT & FANKHANEL, LLP
Michael Blay Greg Fankhanel
City Manager Managing Partner
APPROVED AS TO FORM:

Best Best & Krieger LLP
City Attorney
-3-

CITY OF UPLAND

PROFESSIONAL SERVICES AGREEMENT
This Agreement is made and entered into as of May 8 2023 by and between the City of Upland, a public agency organized and operating under the laws of the State of California with its principal place of business at 460 N. Euclid Avenue, Upland, CA 91786 ("City"), and Van Lant & Fankhanel, LLP, a PARTNERSHIP of Certified Public Accountants with its principal place of business at 29970 Technology Drive, Suite 105A Murrieta, CA 92563 (hereinafter referred to as "Consultant"). City and Consultant are sometimes individually referred to as "Party" and collectively as "Parties" in this Agreement.

RECITALS
A. City is a public agency of the State of California and is in need of professional services for the following project:

Auditing services for annual financial statements (hereinafter referred to as "the Project").

B. Consultant is duly licensed and has the necessary qualifications to provide such services.

C. The Parties desire by this Agreement to establish the terms for City to retain Consultant to provide the services described herein.

AG REEMENT
NOW, THEREFORE, IT IS AGREED AS FOLLOWS:

1. Services.

Consultant shall provide the City with the services described in the Scope of Services and Schedule of Charges attached hereto as Exhibit"A."

2. Compensation.
a. Subject to paragraph 2(b) below, the City shall pay for such services in accordance with the Schedule of Charges set forth in Exhibit"A." b. In no event shall the total amount paid for services rendered by Consultant under this Agreement exceed the sum of $203,500 [Two hundred three thousand five hundred dollars]. This amount is to cover all printing and related costs, and the City will not pay any additional fees for printing expenses. Periodic payments shall be made within 30 days of receipt of an invoice which includes a detailed description of the work performed. Payments to Consultant for work performed will be made on a monthly billing basis. c. The City Manager may approve Additional Work, as further defined in Section 3, up to ten percent (10%) of the amount of the Agreement or twenty thousand three hundred fifty dollars ($20,350). In no event shall the total sum of the agreement (original compensation amount and Additional Work) exceed two hundred twenty-three thousand eight hundred fifty dollars ($223,850). Any additional work in excess of this amount shall be approved by the City Council.
1

3. Additional Work.

If changes in the work seem merited by Consultant or the City, and informal consultations with the other party indicate that a change is warranted, it shall be processed in the following manner: a letter outlining the changes shall be forwarded to the City by Consultant with a statement of estimated changes in fee or time schedule. An amendment to this Agreement shall be prepared by the City and executed by both Parties before performance of such services, or the City will not be required to pay for the changes in the scope of work. Such amendment shall not render ineffective or invalidate unaffected portions of this Agreement.

4. Maintenance of Records.

Books, documents, papers, accounting records, and other evidence pertaining to costs incurred shall be maintained by Consultant and made available at all reasonable times during the contract period and for four (4) years from the date of final payment under the contract for inspection by City.

5. Term
The term of this Agreement shall be from May 8, 2023 to June 30, 2026, unless earlier terminated as provided herein. The Parties may, by mutual, written consent, extend the term of this Agreement for two, one-year additional terms.

6. Delays in Performance.
a. Neither City nor Consultant shall be considered in default of this Agreement for delays in performance caused by circumstances beyond the reasonable control of the non- performing party. For purposes of this Agreement, such circumstances include but are not limited to, abnormal weather conditions; floods; earthquakes; fire; epidemics; pandemics; war; riots and other civil disturbances; strikes, lockouts, work slowdowns, and other labor disturbances; sabotage or judicial restraint.
b. Should such circumstances occur, the non-performing party shall, within a reasonable time of being prevented from performing, give written notice to the other party describing the circumstances preventing continued performance and the efforts being made to resume performance of this Agreement.

7. Compliance with Law.
a. Consultant shall comply with all applicable laws, ordinances, codes and regulations of the federal, state and local government, including Cal/OSHA requirements. b. If required, Consultant shall assist the City, as requested, in obtaining and maintaining all permits required of Consultant by federal, state and local regulatory agencies. c. If applicable, Consultant is responsible for all costs of clean up and/or removal of hazardous and toxic substances spilled as a result of his or her services or operations performed under this Agreement.

8. Standard of Care
2

Consultant's services will be performed in accordance with generally accepted professional practices and principles and in a manner consistent with the level of care and skill ordinarily exercised by members of the profession currently practicing under similar conditions.

9. Assignment and Subconsultant
Consultant shall not assign, sublet, or transfer this Agreement or any rights under or interest in this Agreement without the written consent of the City, which may be withheld for any reason. Any attempt to so assign or so transfer without such consent shall be void and without legal effect and shall constitute grounds for termination. Subcontracts, if any, shall contain a provision making them subject to all provisions stipulated in this Agreement. Nothing contained herein shall prevent Consultant from employing independent associates, and subconsultants as Consultant may deem appropriate to assist in the performance of services hereunder.

10. Independent Contractor
Consultant is retained as an independent contractor and is not an employee of City. No employee or agent of Consultant shall become an employee of City. The work to be performed shall be in accordance with the work described in this Agreement, subject to such directions and amendments from City as herein provided.
a. PERS Eligibility Indemnification
In the event that Consultant or any employee, agent, or subcontractor of Consultant providing services under this Agreement claims or is determined by a court of competent jurisdiction or the California Public Employees Retirement System ("PERS") to be eligible for enrollment in PERS as an employee of the City, Consultant shall indemnify, defend, and hold harmless City for the payment of any employee and/or employer contributions for PERS benefits on behalf of Consultant or its employees, agents, or subcontractors, as well as for the payment of any penalties and interest on such contributions, which would otherwise be the responsibility of City.

Notwithstanding any other agency, state or federal policy, rule, regulation, law or ordinance to the contrary, Consultant and any of its employees, agents, and subcontractors providing service under this Agreement shall not qualify for or become entitled to, and hereby agree to waive any claims to, any compensation, benefit, or any incident of employment by City, including but not limited to eligibility to enroll in PERS as an employee of City and entitlement to any contribution to be paid by City for employer contribution and/or employee contributions for PERS benefits.

11. Insurance. Consultant shall not commence work for the City until it has provided evidence satisfactory to the City it has secured all insurance required under this section. In addition, Consultant shall not allow any subcontractor to commence work on any subcontract until it has secured all insurance required under this section. a. Commercial General Liability
(i) The Consultant shall take out and maintain, during the performance of all work under this Agreement, in amounts not less than specified herein, Commercial General Liability Insurance, in a form and with insurance companies acceptable to the City. 3

(ii) Coverage for Commercial General Liability insurance shall be at least as broad as the following:
(1) Insurance Services Office Commercial General Liability coverage (Occurrence Form CG 00 01) or exact equivalent. (iii) Commercial General Liability Insurance must include coverage for the following:
(1) Bodily Injury and Property Damage
(2) Personal Injury/Advertising Injury
(3) Premises/Operations Liability
(4) Products/Completed Operations Liability
(5) Aggregate Limits that Apply per Project
(6) Explosion, Collapse and Underground (UCX) exclusion deleted
(7) Contractual Liability with respect to this Agreement (8) Property Damage
(9) Independent Contractors Coverage
(iv) The policy shall contain no endorsements or provisions limiting coverage for(1) contractual liability; (2) cross liability exclusion for claims or suits by one insured against another; (3) products/completed operations liability; or (4) contain any other exclusion contrary to the Agreement.
(v) The policy shall give City, its officials, officers, employees, agents and City designated volunteers additional insured status using ISO endorsement forms CG 20 10 10 01 and 20 37 10 01, or endorsements providing the exact same coverage. (vi) The general liability program may utilize either deductibles or provide coverage excess of a self-insured retention, subject to written approval by the City, and provided that such deductibles shall not apply to the City as an additional insured. b. Automobile Liability
(i) At all times during the performance of the work under this Agreement, the Consultant shall maintain Automobile Liability Insurance for bodily injury and property damage including coverage for owned, non-owned and hired vehicles, in a form and with insurance companies acceptable to the City.
(ii) Coverage for automobile liability insurance shall be at least as broad as Insurance Services Office Form Number CA 00 01 covering automobile liability (Coverage Symbol 1, any auto).
(iii) The policy shall give City, its officials, officers, employees, agents and City designated volunteers additional insured status. (iv) Subject to written approval by the City, the automobile liability program may utilize deductibles, provided that such deductibles shall not apply to the City as an additional insured, but not a self-insured retention.
c. Workers' Compensation/Employer's Liability
4

(i) Consultant certifies that he/she 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 to undertake self-insurance in accordance with the provisions of that code, and he/she will comply with such provisions before commencing work under this Agreement.
(ii) To the extent Consultant has employees at any time during the term of this Agreement, at all times during the performance of the work under this Agreement, the Consultant shall maintain full compensation insurance for all persons employed directly by him/her to carry out the work contemplated under this Agreement, all in accordance with the "Workers' Compensation and Insurance Act," Division IV of the Labor Code of the State of California and any acts amendatory thereof, and Employer's Liability Coverage in amounts indicated herein. Consultant shall require all subconsultants to obtain and maintain, for the period required by this Agreement, workers' compensation coverage of the same type and limits as specified in this section.
d. Professional Liability (Errors and Omissions).

At all times during the performance of the work under this Agreement the Consultant shall maintain professional liability or Errors and Omissions insurance appropriate to its profession, in a form and with insurance companies acceptable to the City and in an amount indicated herein.

This insurance shall be endorsed to include contractual liability applicable to this Agreement and shall be written on a policy form specifically designed to protect against acts, errors or omissions of the Consultant. "Covered Professional Services" as designated in the policy must specifically include work performed under this Agreement. The policy must"pay on behalf of'the insured and must include a provision establishing the insurer's duty to defend. e. Minimum Policy Limits Required
(i) The following insurance limits are required for the Agreement:

Combined Single Limit
Commercial General Liability $1,000,000 per occurrence/ $2,000,000 aggregate for bodily injury, personal injury, and property
damage
Automobile Liability $1,000,000 combined single limit Employer's Liability $1,000,000 per accident or disease Professional Liability $1,000,000 per claim and aggregate (errors and omissions)
(ii) Defense costs shall be payable in addition to the limits. (iii) Requirements of specific coverage or limits contained in this section are not intended as a limitation on coverage, limits, or other requirement, or a waiver of any coverage normally provided by any insurance. Any available coverage shall be provided to the parties required to be named as Additional Insured pursuant to this Agreement. f. Evidence Required
5

Prior to execution of the Agreement,the Consultant shall file with the City evidence of insurance from an insurer or insurers certifying to the coverage of all insurance required herein. Such evidence shall include original copies of the ISO CG 00 01 (or insurer's equivalent) signed by the insurer's representative and Certificate of Insurance (Acord Form 25-S or equivalent), together with required endorsements. All evidence of insurance shall be signed by a properly authorized officer, agent, or qualified representative of the insurer and shall certify the names of the insured, any additional insureds, where appropriate, the type and amount of the insurance, the location and operations to which the insurance applies, and the expiration date of such insurance.
g. Policy Provisions Required
(i) Consultant shall provide the City at least thirty (30) days prior written notice of cancellation of any policy required by this Agreement, except that the Consultant shall provide at least ten (10) days prior written notice of cancellation of any such policy due to non-payment of premium. If any of the required coverage is cancelled or expires during the term of this Agreement, the Consultant shall deliver renewal certificate(s) including the General Liability Additional Insured Endorsement to the City at least ten (10) days prior to the effective date of cancellation or expiration.
(ii) The Commercial General Liability Policy and Automobile Policy shall each contain a provision stating that Consultant's policy is primary insurance and that any insurance, self-insurance or other coverage maintained by the City or any named insureds shall not be called upon to contribute to any loss.
(iii) The retroactive date (if any) of each policy is to be no later than the effective date of this Agreement. Consultant shall maintain such coverage continuously for a period of at least three years after the completion of the work under this Agreement. Consultant shall purchase a one (1) year extended reporting period A) if the retroactive date is advanced past the effective date of this Agreement; B) if the policy is cancelled or not renewed; or C) if the policy is replaced by another claims-made policy with a retroactive date subsequent to the effective date of this Agreement.
(iv) All required insurance coverages, except for the professional liability coverage, shall contain or be endorsed to provide a waiver of subrogation in favor of the City, its officials, officers, employees, agents, and volunteers or shall specifically allow Consultant or others providing insurance evidence in compliance with these specifications to waive their right of recovery prior to a loss. Consultant hereby waives its own right of recovery against City, and shall require similar written express waivers and insurance clauses from each of its subconsultants.
(v) The limits set forth herein shall apply separately to each insured against whom claims are made or suits are brought, except with respect to the limits of liability.

Further the limits set forth herein shall not be construed to relieve the Consultant from liability in excess of such coverage, nor shall it limit the Consultant's indemnification obligations to the City and shall not preclude the City from taking such other actions available to the City under other provisions of the Agreement or law.
h. Qualifying Insurers
(i) All policies required shall be issued by acceptable insurance companies, as determined by the City, which satisfy the following minimum requirements:
6

(1) Each such policy shall be from a company or companies with a current A.M. Best's rating of no less than A:VII and admitted to transact in the business of insurance in the State of California, or otherwise allowed to place insurance through surplus line brokers under applicable provisions of the California Insurance Code or any federal law.

Additional Insurance Provisions
(i) The foregoing requirements as to the types and limits of insurance coverage to be maintained by Consultant, and any approval of said insurance by the City, is not intended to and shall not in any manner limit or qualify the liabilities and obligations otherwise assumed by the Consultant pursuant to this Agreement, including but not limited to, the provisions concerning indemnification.
(ii) If at any time during the life of the Agreement, any policy of insurance required under this Agreement does not comply with these specifications or is canceled and not replaced, City has the right but not the duty to obtain the insurance it deems necessary and any premium paid by City will be promptly reimbursed by Consultant or City will withhold amounts sufficient to pay premium from Consultant payments. In the alternative, City may cancel this Agreement.
(iii) The City may require the Consultant to provide complete copies of all insurance policies in effect for the duration of the Project. (iv) Neither the City nor any of its officials, officers, employees, agents or volunteers shall be personally responsible for any liability arising under or by virtue of this Agreement.
j. Subconsultant Insurance Requirements. Consultant shall not allow any subcontractors or subconsultants to commence work on any subcontract until they have provided evidence satisfactory to the City that they have secured all insurance required under this section.

Policies of commercial general liability insurance provided by such subcontractors or subconsultants shall be endorsed to name the City as an additional insured using ISO form CG 20 38 04 13 or an endorsement providing the exact same coverage. If requested by Consultant, City may approve different scopes or minimum limits of insurance for particular subcontractors or subconsultants.

12. Indemnification.
a. To the fullest extent permitted by law, Consultant shall defend (with counsel of City's choosing), indemnify and hold the City, its officials, officers, employees, volunteers, and agents free and harmless from any and all claims, demands, causes of action, costs, expenses, liability, loss, damage or injury of any kind, in law or equity, to property or persons, including wrongful death, in any manner arising out of, pertaining to, or incident to any acts, errors or omissions, or willful misconduct of Consultant, its officials, officers, employees, subcontractors, consultants or agents in connection with the performance of the Consultant's services, the Project or this Agreement, including without limitation the payment of all damages, expert witness fees and attorney's fees and other related costs and expenses. Consultant's obligation to indemnify shall not be restricted to insurance proceeds, if any, received by Consultant, the City, its officials, officers, employees, agents, or volunteers.
7

b. If Consultant's obligation to defend, indemnify, and/or hold harmless arises out of Consultant's performance of"design professional" services (as that term is defined under Civil Code section 2782.8), then, and only to the extent required by Civil Code section 2782.8, which is fully incorporated herein, Consultant's indemnification obligation shall be limited to claims that arise out of, pertain to, or relate to the negligence, recklessness, or willful misconduct of the Consultant, and, upon Consultant obtaining a final adjudication by a court of competent jurisdiction, Consultant's liability for such claim, including the cost to defend, shall not exceed the Consultant's proportionate percentage of fault.

13. California Labor Code ReQuirements.
a. Consultant is aware of the requirements of California Labor Code Sections 1720 et seq. and 1770 et seq., which require the payment of prevailing wage rates and the performance of other requirements on certain "public works" and "maintenance" projects ("Prevailing Wage Laws"). If the services are being performed as part of an applicable "public works" or "maintenance" project, as defined by the Prevailing Wage Laws, and if the total compensation is $1,000 or more, Consultant agrees to fully comply with such Prevailing Wage Laws. Consultant shall defend, indemnify and hold the City, its officials, officers, employees and agents free and harmless from any claims, liabilities, costs, penalties or interest arising out of any failure or alleged failure to comply with the Prevailing Wage Laws. It shall be mandatory upon the Consultant and all subconsultants to comply with all California Labor Code provisions, which include but are not limited to prevailing wages (Labor Code Sections 1771, 1774 and 1775), employment of apprentices (Labor Code Section 1777.5), certified payroll records (Labor Code Sections 1771.4 and 1776), hours of labor(Labor Code Sections 1813 and 1815) and debarment of contractors and subcontractors (Labor Code Section 1777.1). The requirement to submit certified payroll records directly to the Labor Commissioner under Labor Code section 1771.4 shall not apply to work performed on a public works project that is exempt pursuant to the small project exemption specified in Labor Code Section 1771.4. b. If the services are being performed as part of an applicable "public works" or "maintenance" project, then pursuant to Labor Code Sections 1725.5 and 1771.1, the Consultant and all subconsultants performing such services must be registered with the Department of Industrial Relations. Consultant shall maintain registration for the duration of the Project and require the same of any subconsultants, as applicable. Notwithstanding the foregoing,the contractor registration requirements mandated by Labor Code Sections 1725.5 and 1771.1 shall not apply to work performed on a public works project that is exempt pursuant to the small project exemption specified in Labor Code Sections 1725.5 and 1771.1. c. This Agreement may also be subject to compliance monitoring and enforcement by the Department of Industrial Relations. It shall be Consultant's sole responsibility to comply with all applicable registration and labor compliance requirements. Any stop orders issued by the Department of Industrial Relations against Consultant or any subcontractor that affect Consultant's performance of services, including any delay, shall be Consultant's sole responsibility. Any delay arising out of or resulting from such stop orders shall be considered Consultant caused delay and shall not be compensable by the City. Consultant shall defend, indemnify and hold the City, its officials, officers, employees and agents free and harmless from any claim or liability arising out of stop orders issued by the Department of Industrial Relations against Consultant or any subcontractor.

14. Verification of Employment Eligibility.
8

By executing this Agreement, Consultant verifies that it fully complies with all requirements and restrictions of state and federal law respecting the employment of undocumented aliens, including, but not limited to, the Immigration Reform and Control Act of 1986, as may be amended from time to time, and shall require all subconsultants and sub-subconsultants to comply with the same.

15. Reserved.

16. Laws and Venue.

This Agreement shall be interpreted in accordance with the laws of the State of California.

If any action is brought to interpret or enforce any term of this Agreement, the action shall be brought in a state or federal court situated in the County of San Bernardino, State of California. 17 Termination or Abandonment
a. City has the right to terminate or abandon any portion or all of the work under this Agreement by giving ten(10)calendar days written notice to Consultant. In such event, City shall be immediately given title and possession to all original field notes, drawings and specifications, written reports and other documents produced or developed for that portion of the work completed and/or being abandoned. City shall pay Consultant the reasonable value of services rendered for any portion of the work completed prior to termination. If said termination occurs prior to completion of any task for the Project for which a payment request has not been received, the charge for services performed during such task shall be the reasonable value of such services, based on an amount mutually agreed to by City and Consultant of the portion of such task completed but not paid prior to said termination. City shall not be liable for any costs other than the charges or portions thereof which are specified herein. Consultant shall not be entitled to payment for unperformed services, and shall not be entitled to damages or compensation for termination of work.
b. Consultant may terminate its obligation to provide further services under this Agreement upon thirty(30) calendar days'written notice to City only in the event of substantial failure by City to perform in accordance with the terms of this Agreement through no fault of Consultant.
18 Documents. Except as otherwise provided in "Termination or Abandonment," above, all original field notes, written reports, Drawings and Specifications and other documents, produced or developed for the Project shall, upon payment in full for the services described in this Agreement, be furnished to and become the property of the City.

19. Organization
Consultant shall assign Greg Fankhanel, CPA, CFE as Project Manager. The Project Manager shall not be removed from the Project or reassigned without the prior written consent of the City.

20. Limitation of Agreement.

This Agreement is limited to and includes only the work included in the Project described above.

21. Notice
9

Any notice or instrument required to be given or delivered by this Agreement may be given or delivered by depositing the same in any United States Post Office, certified mail, return receipt requested, postage prepaid, addressed to:

DISTRICT: CONSULTANT:

City of Upland Van Lant& Fankhanel, LLP
460 N. Euclid Avenue 29970 Technology Drive, Suite 105A Upland, CA 91786 Murrieta, CA 92563
Attn: Michael Blay, City Manager Greg Fankhanel, CPA, CFE, Managing Partner and shall be effective upon receipt thereof.

22. Third Party Rights
Nothing in this Agreement shall be construed to give any rights or benefits to anyone other than the City and the Consultant.

23. Equal Opportunity Employment.

Consultant represents that it is an equal opportunity employer and that it shall not discriminate against any employee or applicant for employment because of race, religion, color, national origin, ancestry, sex, age or other interests protected by the State or Federal Constitutions. Such non-discrimination shall include, but not be limited to, all activities related to initial employment, upgrading, demotion, transfer, recruitment or recruitment advertising, layoff or termination.

24. Entire Agreement
This Agreement, with its exhibits, represents the entire understanding of City and Consultant as to those matters contained herein, and supersedes and cancels any prior or contemporaneous oral or written understanding, promises or representations with respect to those matters covered hereunder. Each Party acknowledges that no representations, inducements, promises or agreements have been made by any person which are not incorporated herein, and that any other agreements shall be void. This Agreement may not be modified or altered except in writing signed by both Parties hereto. This is an integrated Agreement.

25. Severability
The unenforceability, invalidity or illegality of any provision(s) of this Agreement shall not render the remaining provisions unenforceable, invalid or illegal.

26. Successors and Assigns
This Agreement shall be binding upon and shall inure to the benefit of the successors in interest, executors, administrators and assigns of each Party to this Agreement. However, Consultant shall not assign or transfer by operation of law or otherwise any or all of its rights, burdens, duties or obligations without the prior written consent of City. Any attempted assignment without such consent shall be invalid and void.
10

27. Non-Waiver
None of the provisions of this Agreement shall be considered waived by either Party, unless such waiver is specifically specified in writing.

28. Time of Essence
Time is of the essence for each and every provision of this Agreement.

29. City's Right to Employ Other Consultants
City reserves its right to employ other consultants, including engineers, in connection with this Project or other projects.

30. Prohibited Interests
Consultant maintains and warrants that it has not employed nor retained any company or person, other than a bona fide employee working solely for Consultant, to solicit or secure this Agreement. Further, Consultant warrants that it has not paid nor has it agreed to pay any company or person, other than a bona fide employee working solely for Consultant, any fee, commission, percentage, brokerage fee, gift or other consideration contingent upon or resulting from the award or making of this Agreement. For breach or violation of this warranty, City shall have the right to rescind this Agreement without liability. For the term of this Agreement, no director, official, officer or employee of City, during the term of his or her service with City, shall have any direct interest in this Agreement, or obtain any present or anticipated material benefit arising therefrom.
[SIGNATURES ON FOLLOWING PAGE]
11

SIGNATURE PAGE FOR PROFESSIONAL SERVICES AGREEMENT

BETWEEN CITY OF UPLAND

AND VAN LANT & FANKHANEL, LLP
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first written above.

CITY OF UPLAND VAN LANT & FANKHANEL, LLP
By:

By:0/A.el Blay
C anager Its: Managing Partner
Printed Name: Greg Fankhanel, LLP
ATTEST:

By:

Keri Johnson, City Ierk
12

EXHIBIT A
Scope of Services and Schedule of Charges
13

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Submitted by:

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California License No. PAR 7535
Contact Information:

Greg Fankhanel, CPA, CFE
Brett Van Lant, CPA
29970 Technology Drive, Suite 105 A
Murrieta, CA 92563
Telephone: (909) 856-6879
E-mail: [email protected]
[email protected]
March 6,2023

CITY OF LAGUNA HILLS

PROPOSAL TO PERFORM ANNUAL AUDIT SERVICES

TABLE OF CONTENTS
Page Number
Cover Letter 1
Company Data 3
Resumes and Qualifications: 5
Engagement Partner Resume— Brett Van Lant, CPA 6 Quality Control Reviewer Resume—Greg Fankhanel, CPA, CFE 7 Engagement Supervisor Resume— Enrico Tobing, CPA 8
Senior Accountant Resume—Antonio Moran, CPA 9 Organizational Chart 10
References 11
Project Understanding, Overview and Approach 13
Schedule 14
Communication 18
Compensation/Payment Schedule 19
Certificate of Insurance 19
Certification of Proposal 19
Peer Review 19
Attachment 1: Non-Collusion Affidavit 21
Attachment 2: Acknowledgment of Compliance with Insurance 23 Attachment 3: Certification of Proposal 25
Appendix A— Peer Review Report 28

Van land &
Fankhonel, LIP
----1 Certified Public Accountants (-
March 6, 2023
Stephen Parker, Assistant City Manager
City of Upland
460 North Euclid Avenue
Upland, CA 91786
Van Lant & Fankhanel, LLP (VLF) is pleased to submit our proposal to perform professional audit services for the City of Upland (City). We hope this proposal conveys our strong desire and qualifications to fulfill your requirements. We understand this proposal is to audit the City's financial statements for five fiscal years beginning with the fiscal year ending June 30, 2023, with the option to extend for two additional years.

VLF is a local firm of Certified Public Accountants with offices located in Redlands and Murrieta, California. The principals of the firm (Mr. Brett Van Lant and Mr. Greg Fankhanel) have been providing governmental accounting and auditing services to California cities and special districts for over 40 years combined. VLF is dedicated to providing the highest level of experience and expertise in governmental accounting knowledge to ensure a smooth audit process with minimal disruption to the City's ongoing daily administrative operations.

VLF is the best choice to provide annual audit services to the City of Upland for the following significant reasons:
• We have extensive experience auditing California cities and special districts that offer similar services as the City.
• Significant Partner involvement throughout the audit engagement. Audit Partners will be performing fieldwork and preparing reports with the assistance of senior level auditors. Having the Audit Partners involved in all aspects of the audit assures continuity of the audit team each year.
■ A complete understanding of the City's reporting requirements and deadlines. In addition, we assist a number of cities and special districts each year in obtaining the GFOA award for excellence in financial reporting.
• Mr. Fankhanel is also a Certified Fraud Examiner which adds another level of expertise to the audit process. We have assisted many California cities in strengthening internal controls, and establishing effective policies and procedures. f
Van Lant&Fankhanel,LLP
29970 Technology Drive,Suite 105 A
Murrieta,CA 92563
909.856.6879 1

What sets us apart from other audit firms? You are not just a number to us — every audit client is unique and important to us. As a smaller firm, we believe the personal service and attention we will provide cannot be duplicated at larger firms. While many firms have knowledgeable and experienced individuals on staff, the quality of each audit ultimately depends on the audit personnel involved in the daily audit process, including fieldwork and report preparation. With VLF, you will be dealing with Partner-level personnel throughout the audit process, including fieldwork.

We are passionate about providing the highest level of service. We believe one the best services we can provide is to be available throughout the year to assist our clients with questions and keep them apprised of new accounting and financial reporting requirements. We encourage our clients to communicate questions or concerns, not only during the audit process, but as they arise at any time during the year. You will have access to the audit partners on a daily basis, throughout each audit and each fiscal year.

We certify that VLF and the audit partners are properly licensed to practice in California. We agree to perform all of the work outlined in the RFP within the time periods established by the City. Our firm is an Equal Opportunity Employer, and has the required insurance coverage as listed in the City's RFP. Greg Fankhanel is authorized to represent VLF, empowered to submit this proposal, and authorized to sign a contract with the City. This proposal is a firm and irrevocable offer to audit the financial statements for the three fiscal years beginning with fiscal year 2023. Should you have any questions regarding our proposal or desire additional information, please call Greg Fankhanel, CPA, at (909) 856-6879, or email to [email protected].

Respectfully submitted,
Greg Fankhanel, CPA, CFE
Managing Partner
2

License and Independence City of Upland
VLF and all assigned key professional staff are properly licensed by the California State Board of Accountancy to practice in the State of California (License No. PAR 7535).

We are independent of the City of Upland and its component units in accordance with generally accepted auditing standards as promulgated by Rule 101 of the American Institute of Certified Public Accountants Code of Professional Ethics, generally accepted government auditing standards promulgated by the U.S. General Accounting Office (GAO), and the rules of the California State Board of Accountancy and Accounting Oversight Board.

We will provide the City with written notice of any professional relationships entered into during the period of our engagement that may impair our independence, if necessary. We have provided audit services to the City of Upland for the past five years, and have maintained our independence throughout.

We have been engaged as the City of Upland's independent auditors for the past 5 years. Our relationship as independent auditors does not constitute a conflict of interest relative to performing the proposed audit due to our professional standards that require us to remain independent in fact and appearance, throughout the term of our engagement.

Firm Qualifications and Experience
Van Lant& Fankhanel, LLP (VLF) is a local firm of Certified Public Accountants specializing in local government accounting and financial reporting. VLF currently serves a number of local governments throughout the State. Our Firm's mission is to provide our clients with the highest level of experience and expertise, throughout each year of our engagement. Because VLF is a smaller firm dedicated to governmental accounting and auditing services, we provide our clients with Partner level individuals in the field each year of the audit engagement. This has proven to be a valuable service to our clients and helps to significantly reduce the amount of client staff time consumed by the audit process.

The proposed audit team will include 2 full-time Audit Partners and 1 full-time Senior Accountant and 1 additional staff as necessary. One of the Audit Partners will be assigned to perform quality control reviews and assist with audit fieldwork as necessary.

Our Murrieta office will be the engagement office assigned to the City. VLF currently provides audit and accounting services to a number of cities and special districts throughout California.

Auditing Services Proposal
3

City of Upland
LikInformation regarding several of our current audit clients has been included in this proposal. Please contact these organizations to learn more about our firm's ability to provide excellent audit services.

Greg Fankhanel has been a reviewer for the GFOA ACFR award program for many years.

Our Firm focuses on providing audit and assurance services to municipal and non-profit organizations. The Partners have also provided TOT and Franchise Fee audit services, and other consulting services, including fraud investigations.

The engagement team members proposed to serve the City are highly-trained government auditors.

One of our goals is to avoid putting our clients in a position of having to "train" the auditors. We avoid this by ensuring that all fieldwork is properly staffed and supervised by Partner level personnel. We are required to complete at least 80 hours of continuing education every 2 years, with a majority of these hours relating specifically to government accounting and auditing subjects.

Continuing education requirements are met through classes developed by professional organizations, such as the CSCPA, GFOA, and the AICPA. Both Mr. Fankhanel and Mr. Van Lant have been instructors for an in-house continuing education program for several years.

Current Municipal Audit Clients
Below is a list of current municipal audit clients for which we currently provide audit services.

Current Municipal Clients
Town of Apple Valley City of Upland*
City of Clearlake City of West Covina
City of Buena Park* City of Winters*
City of Delano* City of Yucaipa*
City of Hemet* Apple Valley Fire Protection District City of Hidden Hills Lake Arrowhead Community Services District* City of Highland* Greenfield County Water District City of La Puente* Riverside County Flood Control District* City of Montclair Running Springs Water District City of Susanville Tehachapi Cummings County Water District* City of Tehachapi* Temescal Valley Water District City of Ukiah* Western Riverside Council of Governments Participation in External Quality Control Review Program As required by Government Auditing Standards, our firm must have a peer review once every three years. We received a "clean" opinion with no deficiencies in our most recent peer review report, which included a review of specific government engagements. A copy of the report is included at Appendix A.

In addition, we have established a quality control program to adhere to the stringent quality control standards established by the AICPA. We have also developed policies and procedures to ensure our Auditing Services Proposal
4

ACity of Upland
engagements are properly supervised and staff receives necessary training to handle the responsibilities afforded them.

Disciplinary Action
There have been no disciplinary or regulatory actions taken against our CPA firm, or the partners. The firm has had no negative federal or state reviews.

Partner, Supervisory, and Staff Qualifications and Experience The proposed Engagement Team selected to serve the City have extensive experience and a proven record of providing excellent audit services to Cities of similar size and operations.

Engagement Partner
Greg Fankhanel, CPA, CFE
Engagement Quality Control
Reviewer
Brett Van Lant, CPA
Audit Senior
Enrico Tobing, CPA
We will provide continuity of audit staff from year to year, which is in the best interest of the City and is most efficient from our firm's perspective. Additionally, the audit partners assigned to this engagement are working partners and therefore will be involved throughout the entire engagement each year, including fieldwork.

Auditing Services Proposal
5

City of Upland
A
We affirm that engagement partners, managers, and other supervisory staff may be changed if those personnel leave the firm, are promoted or are assigned to another office. These personnel may also be changed for other reasons only with the express prior written permission of the City.

We agree the City retains the right to approve or reject replacements.

Greg W. Fankhanel, CPA, CFE
Engagement Partner
Mr. Fankhanel is the managing Partner of VLF and has 30+ years of experience auditing local governments and non-profits, including cities and special districts throughout the State of California.

Mr. Fankhanel will be extensively involved throughout the audit process. He has served as a special reviewer for the GFOA certificate of achievement program for many years. In addition, he will be the point of contact for the City throughout the engagement.

Brett Van Lant, CPA
Quality Control Partner
Mr. Van Lant is an Audit Partner for VLF and has over 15 years of experience auditing local governments and non-profits, including cities and special districts throughout the State of California.

His duties will include supervising the engagement team during fieldwork, reviewing all reports, and performing the review and approval of the audit engagement. His duties will include performing quality control reviews of the engagement and serve as the concurring partner for the audit.

Enrico Tobing, CPA
Supervisor
Mr. Tobing is a Supervisor with VLF with over 8 years of experience. He will work closely with Mr.

Fankhanel during the audit fieldwork and report preparation for the City. Mr. Tobing has extensive experience auditing local governments, including cities and special districts throughout the State of California.

Resumes of the proposed engagement team are provided below:

Auditing Services Proposal
6

GREG W . FANKHANEL,

CPA, CFE
Engagement Partner

PROFESSIONAL MEMBERSHIPS
Greg W. Fankhanel is the • Member,American Institute of Certified Public Accountants (AICPA) Managing Partner of Van Lant & • Member, California Society of Certified Public Accountants (CalCPA) Fankhanel, LLP. Prior to co- • Member,California Society of Municipal Finance Officers (CSMFO) founding our firm, Mr. Fankhanel • Member,Government Finance Officers Association (GFOA) Spent 22 years with Teaman, • Member,Association of Certified Fraud Examiners (ACFE) Ramirez, & Smith where he served •
GFOA Certificate reviewer
as an Audit Partner for over 12
years. PROFESSIONAL EXPERIENCE (PARTIAL LIST)
• Town of Apple Valley
Mr. Fankhanel has extensive • City of Corona experience in leading and • City of Hidden Hills performing financial statement • City of Highland audit engagements for • City of La Puente
government agencies. In addition, • City of Montclair as a Certified Fraud Examiner • City of Murrieta (CFE), he takes a proactive •
City of San Fernando
• City of San Clemente
approach in providing information • City of St. Helena and assistance in fraud prevention • City of Tehachapi and detection, which provides an • City of Ukiah
excellent resource for audit clients. • City of Upland • City of Yucaipa
• City of Winters
• East Valley Water District
• Running Springs Water District
• Lake Arrowhead Community Services District
• Temescal Valley Water District
• Tehachapi-Cummings County Water District
• Valley Sanitary District

CONTINUING PROFESSIONAL EDUCATION
Over 120 hours of continuing education over the past three years with a focus on governmental accounting and auditing topics, along with fraud prevention and detection.

EDUCATION
University of Hawaii
BS Degree in Business Administration, Emphasis in Accounting 7

BRETT VAN LANT, CPA
Engagement QC Reviewer

PROFESSIONAL MEMBERSHIPS
Brett Van Lant is an audit Partner of • Member,American Institute of Certified Public Accountants (AICPA) Van Lant & Fankhanel, LLP. Prior to • Member, California Society of Certified Public Accountants (CalCPA) co-founding our firm, Mr. Van Lant • Member,California Society of Municipal Finance Officers (CSMFO) spent 6 years with Teaman, • Member, Government Finance Officers Association (GFOA) Ramirez, & Smith where he served
as an Audit Manager for over 4 PROFESSIONAL EXPERIENCE (PARTIAL LIST) years. • Town of Apple Valley
• City of Corona
Mr. Van Lant has extensive • City of Delano experience in leading and • City of Healdsburg performing financial statement • City of Hemet audit engagements for • City of Highland
government agencies. He has • City of Hidden Hills worked closely with many local • City of King City governments over the year • City of La Puente assisting with the implementation •
City of Montclair
• City of Murrieta
of significant accounting • City of San Fernando pronouncements including GASB • City of San Clemente 67/68 and GASB 75. • City of Santee
• City of South El Monte
• City of Tehachapi
• City of Ukiah
• City of Upland
• City of Yucaipa
• City of Winters
• East Valley Water District
• Running Springs Water District
• Lake Arrowhead Community Services District
• Temescal Valley Water District
• Tehachapi-Cummings County Water District
• Valley Sanitary District

CONTINUING PROFESSIONAL EDUCATION
Over 120 hours of continuing education over the past three years with a focus on governmental accounting and auditing topics,along with topics related to audits performed under the Uniform Guidance.

EDUCATION
California State University,San Bernardino
BS Degree in Business Administration, Emphasis in Accounting 8

ENRICO TOBING, CPA
Engagement Supervisor

PROFESSIONAL MEMBERSHIPS
Enrico Tobing is an audit Supervisor • Member,American Institute of Certified Public Accountants (AICPA) at Van Lant & Fankhanel, LLP. • Member, California Society of Municipal Finance Officers (CSMFO) Enrico joined VLF upon graduating
from California State University,San PROFESSIONAL EXPERIENCE Bernardino.
• Town of Apple Valley
•
Mr. Tobing has over 6 years' City of Delano
experience performing financial • City of H
• City of Hidden Hills
statement audit engagements for • City of Highland government agencies. He has • City of La Puente been involved in numerous audit • City of Lemon Grove engagements throughout the • City of Maywood years participating in the planning • City of Montclair process, developing the detailed • City of Murrieta audit approach, performing single • City of San Fernando audit compliance testing, •
City of San Clemente
• City of Santa Paula
supervising staff, and the • City of Susanville preparation of financial and other • City of Tehachapi required reports. He earned his • City of Ukiah CPA license in California in 2020. • City of Upland
• City of Yucaipa
• Town of Windsor
• City of Winters
• East Valley Water District
• Running Springs Water District
• Riverside County Flood Control and Water Conservation District • Lake Arrowhead Community Services District
• Temescal Valley Water District
• Tehachapi-Cummings County Water District

CONTINUING PROFESSIONAL EDUCATION
Over 120 hours of continuing education over the past three years with a focus on governmental accounting and auditing topics,along with topics related to audits performed under the Uniform Guidance.

EDUCATION
California State University,San Bernardino
BS Degree in Business Administration, Emphasis in Accounting 9

Similar Engagements with Other Governmental EntitiesCity of Upland The following are audit client references for which similar services have been provided in the last three years. The audit clients listed below are all current audit clients of our firm. 1) City of Tehachapi
Client Contact: Sue Weir,
Financial Analyst Engagement Partner: Greg Fankhanel City of Tehachapi Total Hours: 295
115 S Robinson Street
Tehachapi, CA 93561
(661) 822-2200, Ext. 111
The City of Tehachapi was incorporated in 1909 as a General Law City and provides the following services: public safety, streets, planning, water, wastewater, refuse, airport, and general administrative services. We conducted the annual audit of the City for the years ended June 30, 2011 through 2021 (including single audit). We also prepared the State Controller's Reports and provided assistance in obtaining the GFOA financial statement award. 2) City of Highland
Client Contact: Chuck Dantuono, Engagement Partner: Brett Van Lant Director of Admin. Services Total Hours: 225
27215 Baseline
Highland, CA 92346
(909) 864-6861, ext. 224
The City of Highland is a General Law City that provides the following services: public safety, streets, planning, and general administrative services. We conducted the annual audit of the City for the years ended June 30, 2017 through June 30, 2021 and provided assistance with the implementation of new GASB Pronouncements. We also provided assistance in submitting for and obtaining the GFOA financial statement award.
3) City of Delano
Client Contact: Rosa Rios, CPA,
Director of Finance/Treasurer Engagement Partner: Brett Van Lant City of Delano Total Hours: 360
1015 11th Avenue
Delano, CA 93215
(661) 720-2235
The City of Delano provides the following services: public safety, streets, planning, waer, wastewater, and general administrative services. We conducted the annual audit of the City for the years ended June 30, 2020 through 2022 (including single audit) and provided assistance with the implementation of GASB 87 and other accounting pronouncements. We also provided assistance in obtaining the GFOA financial statement award.

Auditing Services Proposal
10

4) City of La Puente
Client Contact: Troy Grunklee, City of Upland
Administrative Services Director Engagement Partner: Greg Fankhanel City of La Puente Total Hours: 235
15900 Main St.

La Puente, CA 91744
(626) 855-1509
The City of La Puente is a General Law City that provides the following services: public safety, streets, planning, and general administrative services. We conducted the annual audit of the City for the years ended June 30, 2015 through June 30, 2021 (including single audit) and provided assistance with the implementation of new GASB Pronouncements. We also provided assistance in submitting for and obtaining the GFOA financial statement award. 5) City of Hemet
Client Contact: Tiffany Barnett,
Accounting Manager Engagement Partner: Brett Van Lant City of Hemet Total Hours: 310
445 E. Florida Ave.,
Hemet, CA 92543
(951) 765-2387
The City of Hemet was incorporated in 1910 as a General Law City and provides the following services: public safety (Police and Fire), streets, planning, water, and general administrative services. We conducted the annual audit of the City for the years ended June 30, 2011 through 2014 and June 30, 2021 through June 30, 2022 (including single audit)and provided assistance with the implementation of GASB pronouncements and preparation of the State Controller's Report and annual Street Report. We also provided assistance in submitting for and obtaining the GFOA financial statement award.

Auditing Services Proposal
11

- - Specific Audit Approach City of Upland
We believe that timely and adequate audit planning, along with proper communication throughout the audit process, helps to achieve highly efficient and effective audits. We also believe that one of the most important services that can be rendered to clients is to be available at all times during the year. This approach allows the clients the opportunity to consult with the auditors about technical problems and alternative approaches to accounting issues that arise during the year. We emphasize audit partner availability throughout each fiscal year.

Proposed Segmentation
The following is a proposed segmentation of the engagement, including the level of staff and proposed date involved for each segment.

Level of Estimated
Description Staff Hours
Preaudit planning with City staff. Detail audit
plan provided. Partners 2
Entrance conferences and auditors perform
interim audit procedures, including Single Audit Partners, procedures, if applicable. Senior 145
Progress conference(interim work complete). Partners 1 Auditors mail all necessary audit confirmations. Senior 2 City staff provides trial balances and supporting
schedules for audit. Auditors commence final Partners, examination procedures. Senior 165
Exit conference where auditors propose AJE's
and discuss internal control and compliance
findings from the audit, as applicable. Partners 2 Auditors prepare draft CAFR and other applicable Partners, 30 reports. Senior
City reviews draft CAFR and related audit
reports. N/A N/A
All reports are finalized and submitted. Partners 3 Partners,
All SCO Reports Completed Senior 25
Our proposed segmentation of the engagement is further expanded below:

Auditing Services Proposal
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City
Phase of Upland
Shortly after our appointment as auditors, we will schedule a pre-audit planning meeting during which we will discuss any special concerns, needs and the timing of the audit with appropriate members of the City's staff. We will provide a customized request list or "PBC list" to City staff in advance of our arrival for interim fieldwork.

All members of the proposed engagement team are highly trained municipal auditors with extensive experience auditing similar Cities in California. Therefore, we tailor our approach with the focus of being the least disruptive as possible to the City's staff. To achieve this, as part of the planning phase, the engagement team will review City budgets, organizational charts, year-to-date accounting records, applicable accounting policies and procedures, prior year financial statements, the City's website, and minutes of Council meetings to gain a thorough understanding of the City's operations and activities.

Interim Fieldwork
We take a customized approach to each and every audit. We will apply the "Risk Assessment"audit standards to your audits. An overriding objective throughout the planning process is the identification of risks that should be assessed as to whether they could result in material misstatement of the financial statements whether due to error or fraud. Due to the complex nature of the risk assessment process, it is performed at the Partner level for all of our audit engagements.

The main focus of the interim audit fieldwork is to obtain an understanding and evaluate the City's specific internal accounting control systems. Our review and evaluation of your internal control systems will be completed by reviewing supporting documentation for transactions, walk-throughs, and interviews of City staff. Each of these approaches requires inquiry and observation of City personnel and operations. We will also utilize the City's budget, organizational charts, financial reports, policies and procedures, and other applicable documents.

Interim financial reports will be reviewed and limited analytical procedures will be applied to significant account balances in order to identify potential misstatements early on in the audit process.

As required by our audit standards, we will also perform procedures to identify the risk of fraud within the organization. In addition to reviewing pertinent accounting records and policies and procedures, we will conduct "fraud inquiries" with various selected City staff. Given the sensitive nature of these procedures, these inquiries will be conducted by the Audit Partners.

We will conclude the interim audit period with an exit conference with the appropriate City staff to discuss any findings or control risks we encountered during this interim phase, along with practical recommendations to mitigate these risks. Our recommendations will be directed at safeguarding City assets, improving the effectiveness of City procedures, and improving the reporting of financial information, as applicable.

Auditing Services Proposal
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City of Upland
A
Year-end Fieldwork
This phase of the audit will focus on verifying account balances in the City's general ledger. Balance sheet accounts, along with certain revenue and expenditure/expense will be reviewed for reasonableness and verified with supporting documentation, including third-party confirmations, loan and debt agreements, and other supporting schedules. Analytical and substantive procedures will be performed based on our judgment and the results of our risk assessment.

We will conclude the year-end audit fieldwork with an exit conference with the appropriate City staff to discuss the results of our audit procedures, as well as disclose any proposed journal entries we may have discovered. We will also discuss the preparation of the ACFR and various other reports to be issued for the audit period.

Report Preparation
Partners and senior staff will be solely responsible for preparing the reports.

Our draft reports go through an extensive review process before they are sent to City staff for review. Our goal is to provide "print ready" reports when City staff receives the first draft. This ensures City staff will not have to spend time correcting our mistakes. We have a proven track record of meeting deadlines and being flexible to meet the City's needs as they may change throughout the engagement.

City Staff Assistance
Assistance expected from City staff will include pulling invoices for review, answering procedural questions, and answering other questions regarding the City's activities.

Sampling
Our sampling methods are designed to provide the most coverage possible without expending excess time where impractical. We also concentrate efforts towards those areas known to be susceptible to error. Sample sizes will depend upon our preliminary assessment of control risk and the extent of our planned substantive tests and analytical procedures. We use models based on statistical sampling theories to help determine the sample size of a given population of transactions.

In addition, we may select transactions above a certain dollar threshold, based on materiality, to review. We use sampling in the areas of cash receipts, cash disbursements, payroll, and utility billing.

The audit team will have laptop computers onsite during the audit fieldwork utilizing state-of-the-art software. We utilize programs such as Microsoft Excel to assist in our audit procedures and provide for greater efficiency and effectiveness, including data extraction procedures and analysis. We have significant experience working with many various accounting systems in our government audits.

Auditing Services Proposal
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City of Upland
LIR
Analytical Procedures
Analytical procedures will be performed in the planning stage of the audit(risk assessment process) and in our substantive testing, based on the results of our risk assessment. These procedures will include comparing account balances to prior years and to the current period's budget, and consideration of expected relationships among the accounts and periods. To be effective, the analytical procedures can only be performed once we have determined our expectations based on our understanding of the City's activities and changes from one year to the next. For results that do not meet our expectations, we perform additional substantive procedures to understand and verify the causes for the fluctuations. We make every effort to investigate the fluctuations before obtaining explanations from City staff and consuming staff time unnecessarily. In addition, analytical procedures will also be performed in the overall review stage of the audit.

Approach to Understanding the City's Internal Controls
We will obtain an understanding of the design and implementation of the City's internal controls by performing the procedures as required by SAS 109. This involves documenting our understanding of the internal controls over the areas of cash, investments, revenues and receivables, utility revenues and receivables, expenditures and accounts payable, capital assets, debt, payroll and related liabilities, self-insurance and claims liabilities and grant compliance. We will then evaluate the design of controls and determine whether they have been properly implemented. Evaluating the design of controls involves considering whether the control, individually or in combination with other controls, is capable of effectively preventing or detecting and correcting material misstatements.

In addition, as part of the audit, we will issue an internal control report as required by Government Auditing Standards that will identify significant deficiencies and material weaknesses, if any.

Approach to Understanding Laws and Regulations Subject to Audit Test Work Our audit approach recognizes the importance of laws and regulations in planning the audit of a local governmental entity. As part of the audit, we obtain an understanding of those laws and regulations that have a direct and material effect on the determination of financial statement amounts. We then design the audit to provide reasonable assurance of detecting material instances of noncompliance. We obtain our understanding of applicable laws and regulations by becoming familiar with the following:
1) The terms and provisions of grant agreements and contracts. 2) State and federal restrictions affecting funding received by the City; 3) The Municipal Code of the City.
4) State laws regarding authorized investments, spending limits, debt limits, etc. 5) City policies regarding investments, purchasing, budgets, and the establishment of funds. 6) Bond covenants of outstanding issues.
7) Personnel Policies adopted by the City.
8) Other Federal and State laws and regulations, as appropriate.

Auditing Services Proposal
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City of Upland
Approach to Drawing Samples for Purposes of Tests of Compliance illn
The objective of tests of compliance is to determine whether an organization has complied with laws and regulations that may have a material effect on each major program. Therefore, we select samples that will provide sufficient evidence for that purpose. After defining the population, we determine sample sizes and select samples from each major program. Factors that may affect the sample sizes include the following:
a) The amount of expenditures for the program and the individual awards; b) The newness of the program or changes in its conditions; c) Prior experience with the program, particularly as revealed in audits and other evaluations; d) The extent to which the program is carried out through subreceipients; e) The level to which the program is already subject to program reviews or other forms of independent oversight;
f) The adequacy of controls for ensuring compliance;
g) The expectation of adherence or lack of adherence to the applicable laws and regulations; a h) The potential impact of adverse findings.

In the event that any irregularity in records indicates the City may have suffered or will suffer a monetary loss, we will report such loss to the appropriate City personnel immediately upon discovery in the form of a written report. Responses to City notifications will be prompt and all reports will be remitted in a timely manner to meet your needs. We make it a practice to be proactive in providing guidance and assistance to our audit clients throughout each fiscal year to ensure proper and timely implementation of new and significant accounting pronouncements, and also with laws and regulations.

Assistance expected from City staff will include providing us with documents and information included in our comprehensive request list provided at the start of the audit process, answering operational and procedural type questions, and preparing confirmation letters.

Why hire VLF?
Based on our experience, our approach to the City's audit is unlike other audit firms. The significant involvement of the Audit Partners throughout the audit process helps to achieve highly efficient and effective audits. We customize each audit, each year, and believe our approach will help the City in its efforts to achieve excellence in financial reporting and provide excellent service to the citizens of Upland.

Your City will be top priority for our firm, and you will have access to the Audit Partners on a daily basis. While we are a growing audit firm, we only take on audits when we feel that we can continue to provide this high level of service. In addition, the Audit Partner in charge of the City's audit is a Certified Fraud Examiner, providing a level of service unlike most audit firms.

The Partners and all professional staff have significant training and experience in assisting our clients with the implementation of new GASB pronouncements. We will provide a pro-active approach to ensure the City has taken the necessary steps to effectively implement new standards.

We are committed to being available throughout the year to provide assistance, answer questions, and offer technical advice and examples.

Auditing Services Proposal
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Identification of Anticipated Audit Problems City of Upland We do not anticipate any unusual, significant problems in conducting the audit. The Partners and all professional staff have significant training and experience in assisting our clients with the implementation of new GASB pronouncements. We will provide a pro-active approach to ensure the City has taken the necessary steps to effectively implement new standards.We are committed to being available throughout the year to provide assistance, answer questions, and offer technical advice and examples.

Auditing Services Proposal
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AFees City of Upland
This cost proposal is based on the current audit scope, and is made with the assumption that the City's books and records will be in a reasonably balanced condition and reconciled at the start of the audit and that the representations made to us during this proposal process will remain effective throughout our engagement. The following fees are based on the assumption that the single audit will include no more than one major program, in accordance with the Uniform Guidance.

Summary of Professional Fees and Expenses
Total All-inclusive Maximum Price
Fiscal Year Ending June 30, Optional Years
Service 2023 2024 2025 2026 2027
City Audit,ACFR and Related Reports $ 35,000 $ 35,000 $ 36,000 $ 36,000 $ 37,200 Appropriations Limit Report 650 650 700 700 750 Single Audit and Related Reports 3,800 3,800 4,300 4,300 4,650 Additional Costs - - - - - Total Maximum Cost $ 39,450 $ 39,450 $ 41,000 $ 41,000 $ 42,600 We agree the City may broaden the scope of our engagement and we agree to hold ourselves available to perform such additional work as the City may desire. A progress billing will be submitted following our preliminary audit procedures. A final billing will be submitted upon delivery of all required reports. No billings will be made for out-of-pocket expenses or any other expenses such as typing, clerical, printing or travel costs.

Our standard hourly rates are as follows:

Anticipated FY FY FY FY FY
Position Hours 2022-23 _ 2023-24 2024-25 2025-26 2026-27 Partner 165 $ 200 $ 200 $ 210 $ 210 $ 225 Manager 0 170 170 180 180 190 Senior Accountant 85 140 140 150 150 160 Staff Accountant 85 100 100 100 100 100 Clerical N/A N/A N/A N/A N/A
Total Hours 335
Auditing Services Proposal
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APPENDIX A
19

Patrick D. Spofford, CPA
SPAFFOR. D A N D LANDRY CPAs Todd C. Landry, CPA
HERE TO MAKE THE COMPLEX SIMPLE. Licenseo Cy the Callfornla Boarcl of Accountancy irueAmerican institute of Cernhed Public Accountants
Report on the Firm's System of Quality Control
To Van Lant& Fankhanel, 11P
and the Peer Review Committee of the California Society of CPAs We have reviewed the system of quality control for the accounting and auditing practice of Van Lant & Fankhanel, LLP (the finn) in effect for the year ended February 29. 2020. Our peer review was conducted in accordance with the Standards for Performing and Reporting on Peer Reviews established by the Peer Review Board of the American Institute of Certified Public Accountants(Standards).

A stinimmy of the nature, objectives, scope. limitations of: and the procedures performed in a System Review as described in the Standards may be found at www.aiepa.org/prsummary . The summary also includes an explanation of how engagements identified as not performed or reported in conformity with applicable professional standards, if any, are evaluated by a peer reviewer to determine a peer review rating.

Firm's Responsibility
The firm is responsible for designing a system of quality control and complying with it to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. The firm is also responsible for evaluating actions to promptly remediate engagements deemed as not performed or reported in conformity with professional standards, when appropriate,and for remediating weaknesses in its system of quality control, if any.

Peer Reviewer's Responsibility
Our responsibility is to express an opinion on the design of the system of quality control and the firm's compliance therewith based on our review.

Required Selections and Considerations
Engagements selected for review included engagements performed under Government Auditing Standards, including compliance audits under the Single Audit Act.

As a part of our peer review, we considered reviews by regulatory entities as communicated by the firm. if applicable, in determining the nature and extent of our procedures. 849 W Redlands Blvd..#102. Redlands,CA 92373 • P.O. Box 8847 Redlands,CA 92375 • Tel 909-792-i 852 • Fax 909 792-20" 20

✓ •
Opinion
In our opinion, the system of quality control for the accounting and auditing practice of Van Lant & Fankhanel, LLP in effect for the year ended February 29,2020,has been suitably designed and complied with to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. Firms can receive a rating of pass,pass with deficiency(ies)or fail. Van Lant& Fankhanel,LLP has received a peer review rating of pass. olitd#7tri/tat /4e
July 14,2020
-2-
21

`tCALIFORNIA LEVINE ACT DISCLOSURE STATEMENT
Ogt�� 4Q"
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?
YES If yes, please identify the Council Member(s): _ ZNO

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):

TNO
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. 6-1-2026
Date Signature of authorized individual
Van Lant & Fankhanel, LLP
Company/Applicant Name
(Levine Act definitions on reverse side)

LEVINE ACT DISCLOSURE STATEMENT DEFINITIONS
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; FPPC Reg 18438.2(a) "proceedings" (2) Formally or informally requested by the party; or (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(a)(1) 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 Gov. Code 84308(a)(2) 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 Reg 18438.3 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 Reg Competitively Bid successful bidder refuses or fails to execute the 18438.2(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)(B) 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.