Vernon City Council
February 6, 2024

____________________
agreements between CITY and TreePeople and for the purposes set forth in Exhibit “B”. The Premises may not be used for any other purpose.

6. UTILITIES. CITY will provide all reasonable utilities and services required for the use of the Premises, including electricity, gas, internet, telephone services, trash, water, and janitorial services.

7. TERMINATION. This LEASE may be terminated as follows:

A.

B.

C.

At the expiration of the term;
Upon mutual written agreement between the parties;
Upon the date a condemning authority takes possession of all or any part of the Premises or the building of which the Premises are a part; or D.

E.

As provided in Section 18.

If the term of this LEASE is extended on a month-to-month basis as provided in section 3, upon the giving by either party to the other of 30 (thirty) days prior written notice of termination.

8. CONDITION OF PREMISES UPON TERMINATION. Upon termination of this LEASE for any reason, LESSEE will vacate the Premises and deliver it to CITY in good order and condition, damage by the elements, earthquake, and ordinary wear and tear which could not have been avoided by reasonable maintenance practices excepted.

9. CONDEMNATION. If all or part of the building in which the Premises are located is acquired by eminent domain or purchase in lieu thereof, CITY shall be entitled to receive all awards and compensation in connection therewith, and LESSEE acknowledges that it will have no claim to any compensation awarded for the taking or for loss of or damage to LESSEE’s improvements, provided that LESSEE shall have the right to make a separate claim for loss of its trade fixtures and personal property and for relocation expenses so long as the same does not reduce LESSOR’S award and compensation.

10. FORCE MAJEURE. Except for the payment of monetary sums, no party to this LEASE shall be chargeable with, or liable for, or responsible to the other for anything or in any amount due to, and the time for performance hereunder by such party shall be extended for, any delay caused by fire, earthquake, explosion, flood, the elements, acts of terrorism, acts of God, insurrection, rebellion, riots, strikes, lockouts, unforeseeable labor or material shortages, litigation, or any other cause whether similar or dissimilar to the foregoing which is beyond the reasonable control of such party, and any delay due to said causes or any of them shall not be deemed a default under this LEASE. ..

Item 9 Page 4 of 14
TreePeople Lease Agreement

____________________

11. LESSEE’S PERSONAL PROPERTY. All personal property of LESSEE located at the Premises will remain the property of LESSEE during the term of this LEASE and may be removed by LESSEE at any time and shall be removed by LESSEE prior to the expiration or other termination of the term of this LEASE. LESSEE, at LESSEE’S cost and expense, must promptly repair all damage to the Premises occasioned by the removal of its personal property.

12. ALTERATIONS, MECHANICS’ LIENS. LESSEE will not make, or cause to be made, any alterations or modifications to the Premises, or any part thereof, without CITY’s prior written consent, which consent CITY is under no obligation to give. LESSEE will keep the Premises free from any liens arising out of any permitted work performed, material furnished, or obligations incurred by LESSEE.

13. ASSIGNMENT AND SUBLETTING. This LEASE may not be assigned, transferred, or sublet by LESSEE, whether voluntarily or involuntarily. Any such purported transfer will be null and void.

14. CITY’S ACCESS.

A. Access for Inspection. CITY and CITY’s agents shall have the right to enter the Premises at all reasonable times, upon not less than twenty-four (24) hours prior notice to LESSEE or less in case of an emergency), for the purpose of inspecting same, and making such alterations, repairs, improvements or additions to the Premises as CITY may deem necessary.

CITY will conduct Premises inspections on a quarterly basis to identify maintenance issues that require attention. CITY will provide to LESSEE a report specifying such maintenance issues as are identified that are Lessee’s responsibility under this Lease, and if appropriate, CITY will provide the estimated cost for services to perform the maintenance.

B. No Warranty. Except as otherwise stated in this Lease, LESSEE hereby acknowledges that neither the CITY nor any employees or agents of the CITY has made any oral or written warranties or representations to Lessee relative to the condition or use by LESSEE of said Premises and LESSEE acknowledges that LESSEE assumes all responsibility regarding the Occupational Safety and Health Act, the legal use and adaptability of the Premises and compliance with all applicable laws and regulations in effect during the term of this Lease.

C. Security Measures. CITY shall have the right to require a reasonable security system, device, operation or plan be installed and implemented to protect the Premises or any alterations.

15. HOLDOVER. If LESSEE continues to occupy the Premises after the Lease expires, with CITY’s written consent, such continued occupancy shall be on a month to month basis and such ..

Item 9 Page 5 of 14
TreePeople Lease Agreement

____________________
tenancy otherwise will be subject to all of the terms and conditions of this LEASE excluding rights to extend the term of this LEASE.

16. INDEMNIFICATION. Except to the extent directly caused by CITY’s negligence, LESSEE agrees to indemnify, protect, defend (by counsel reasonably satisfactory to CITY) and hold CITY harmless from and against all claims, losses, liabilities, actions, judgments, costs and expenses (including reasonable attorneys’ fees and costs) which CITY may suffer or incur arising from or relating to (a) LESSEE’s use of the Premises, (b) any negligence, act or omission of LESSEE in or about the Premises or (c) any default by LESSEE under this LEASE. For purposes of this section “CITY” includes CITY’s officers, officials, employees, agents, contractors, representatives, guests, invitees, and volunteers, and “LESSEE” includes LESSEE’s officers, officials, employees, agents, contractors, representatives, guests, invitees, and volunteers.

A. LESSEE expressly agrees that this hold harmless and indemnification provision is intended to be as broad and inclusive as is permitted by the law of the State of California and that if any portion is held invalid, it is agreed that the balance will, notwithstanding, continue in full legal force and effect.

B. It is expressly understood and agreed that the provisions of this Section will survive termination or expiration of this LEASE.

C. The requirements as to the types and limits of insurance coverage to be maintained by LESSEE as required by this LEASE, and any approval of such insurance by CITY, are not intended to and will not in any manner limit or qualify the liabilities and obligations otherwise assumed by LESSEE pursuant to this LEASE, including but not limited to the provisions concerning indemnification.

17. INSURANCE. LESSEE must procure and maintain, at its sole cost and expense, insurance required by the CITY in commercially reasonable amounts and in accordance with all applicable state and federal laws and regulations. LESSEE shall provide CITY policies of insurance types in the amount set forth below for the duration of the LEASE and provide CITY certificates evidencing such coverage, which must be in a form approved by the CITY. In addition, the insurance policies required shall be issued by insurance companies licensed to do business in the state with an A.M. Best rating of at least A-VIII.

A. General Liability coverage with limits of not less than $2,000,000 per occurrence and $4,000,000 aggregate. Premises/Operations and Personal injury coverage is required.

The City of Vernon, its directors, commissioners, officers, employees, agents, and volunteers must be endorsed on the policy as additional insured under the LESSEE insurance policy; it shall be primary and non-contributory without seeking contribution from the CITY’s insurance or self-insurance.

B. Automobile Liability coverage with limits of not less than $1,000,000 per occurrence and $2,000,000 annual aggregate. LESSEE agrees to subrogate automobile liability ..

Item 9 Page 6 of 14
TreePeople Lease Agreement

____________________
resulting from performance under this LEASE. The City of Vernon, its directors, commissioners, officers, employees, agents, and volunteers must be endorsed on the policy as additional insured under LESSEE’s insurance policy; it shall be primary and non-contributory without seeking contribution from the CITY’s insurance or selfinsurance.

C. Professional Errors and Omissions coverage with limits of not less than $5,000,000 per claim and the annual aggregate, covering all acts, errors, omissions, negligence, infringement, of intellectual property (except patent and trade secret), network and privacy risks (including coverage for unauthorized access, failure of security, breach of privacy perils, wrongful disclosure of information, as well as notification costs and regulatory defense) in the performance of services for the CITY or on behalf of the CITY hereunder. LESSEE shall maintain such coverage for at least five years after the termination of this LEASE.

D. Workers’ Compensation coverage with limits of not less than $1,000,000 per occurrence. The policy shall be endorsed to waive all rights of subrogation against the CITY, its directors, commissioners, officers, employees, and volunteers for losses arising from the performance of this LEASE.

E. Excess Liability Coverage. Any umbrella or excess insurance coverage shall contain or be endorsed to include a provision that such coverage shall also apply on a primary and non-contributory basis for the benefit of the CITY before the CITY’s insurance or self-insurance shall be called upon. If the underlying aggregate is exhausted, the excess coverage will drop down as primary insurance.

F. Fire Insurance on Premises. CITY shall maintain insurance (or applicable selfinsurance) for fire damage covering the Premises.

18. COMPLIANCE WITH LAW. LESSEE will, at its sole cost and expense, comply with all of the requirements of all federal, state, and local authorities now in force, or which may hereafter be in force, pertaining to the Premises and will faithfully observe in the use of the Premises all applicable laws, rules and regulations, including, without limitation, laws, rules and regulations relating to the use, storage and disposal of toxic or hazardous substances. The judgment of any court of competent jurisdiction that LESSEE has violated any such requirement, law, rule or regulation in the use of the Premises will be conclusive of that fact as between CITY and LESSEE.

19. AMENDMENT; WAIVER. No term or provision of this LEASE may be amended, altered, modified or waived orally or by a course of conduct, but only by an instrument in writing signed by a duly authorized officer or representative of the party against which enforcement of such amendment, alteration, modification or waiver is sought. Any amendment, alteration, modification or waiver shall be for such period and subject to such conditions as shall be specified in the written instrument evidencing the same. Any waiver shall be effective only in the specific instance and for the specific purpose for which given. ..

Item 9 Page 7 of 14
TreePeople Lease Agreement

____________________

20. DEFAULT. The occurrence of any one or more of the following shall constitute a default by LESSEE:
(a) Failure by LESSEE to make any payment required to be made by LESSEE hereunder as and when due.
(b) Failure by LESSEE to observe or perform any of the covenants or provisions of this LEASE, other than as provided in subsection (a) above, when such failure continues for a period of ten (10) days after written notice of such failure is given by CITY to LESSEE; provided, that if the nature of LESSEE's failure is such that more than ten (10) days are reasonably required for its cure, then LESSEE will not be deemed to be in default if LESSEE commences such cure within said ten (10) day period and thereafter diligently prosecutes such cure to completion. (c) The making by LESSEE of any general arrangement or general assignment for the benefit of creditors; (ii) LESSEE becoming a “debtor” as defined in the federal Bankruptcy Code or any successor statute thereto (unless, in the case of a petition filed against LESSEE, the same is dismissed within sixty (60) days; (iii) the appointment of a trustee or receiver to take possession of substantially all of LESSEE’s assets located at the Premises or of LESSEE’s interest in this LEASE, where possession is not restored to LESSEE within thirty (30) days; or (iv) the attachment, execution or other judicial seizure of substantially all of LESSEE’s assets located at the Premises or of LESSEE’s interest in this LEASE, where such seizure is not discharged within thirty (30) days.

21. REMEDIES. If LESSEE is in default, then, in addition to all other rights and remedies which CITY may have at law or in equity, CITY has the following rights and remedies which are not exclusive but are cumulative:
(a) CITY can, with or without terminating this LEASE, reenter the Premises and remove all property and persons therefrom, and any such property may be removed and stored in a public warehouse or elsewhere at the cost and for the account of LESSEE. If CITY elects to reenter or shall take possession of the Premises pursuant to legal proceedings or pursuant to any notice provided by law, and if CITY has not elected to terminate this LEASE, CITY may either recover all rent as it becomes due under this LEASE or relet the Premises or any part or parts thereof for such term or terms and upon such provisions as CITY may deem advisable and will have the right to make repairs to and alterations of the Premises. No reentry or taking possession of the Premises by CITY is to be construed as an election to terminate this LEASE unless a written notice of such intention is given to LESSEE by CITY. Notwithstanding any reletting without termination by CITY because of LESSEE's default, CITY may at any time after such reletting elect to terminate this LEASE because of such default. If CITY elects to relet the Premises without terminating this LEASE, then rent received by CITY therefrom will be applied as follows:
(i) First, to any indebtedness from LESSEE to CITY other than rent due from LESSEE; ..

Item 9 Page 8 of 14
TreePeople Lease Agreement

____________________
(ii) Second, to all costs and expenses, including, without limitation, for maintenance, repairs or alterations, incurred by CITY in connection with reletting the Premises; and (iii) Third, to the payment of rent due and unpaid under this LEASE and the residue, if any, will be held by CITY and applied in payment of future rent as the same may become due and payable under this LEASE and to any damages and other amounts which CITY is otherwise entitled to under this LEASE. Should that portion of such rent received from such reletting during any month, which is applied to the payment of rent hereunder, be less than the rent payable hereunder during that month by LESSEE, then LESSEE agrees to pay such deficiency to CITY immediately upon demand. In no event will LESSEE be entitled to any excess rent received by CITY from such reletting.
(b) CITY can terminate LESSEE's right to possession of the Premises at any time. No act by CITY other than giving written notice to LESSEE will terminate this LEASE. Acts of maintenance, efforts to relet the Premises, or the appointment of a receiver on CITY's initiative to protect CITY's interest under this LEASE shall not constitute a termination of LESSEE's right to possession.
(c) Without waiving the default, CITY can, at its sole option, pay such sums and/or take such actions as are necessary in CITY’s reasonable judgment in order to cure the default, and all sums expended or incurred by CITY in connection therewith, together with interest thereon at the maximum rate permitted by law, shall be paid by LESSEE to CITY immediately on demand.

22. NOTICES. Except as otherwise expressly provided by law, all notices or other communications required or permitted by this LEASE or by law to be served on or given to either party to this LEASE by the other party will be in writing and will be deemed served when personally delivered (including by commercial courier or next business day delivery service) to the party to whom they are directed, or in lieu of the personal service, upon the date when received as evidenced by the return receipt when deposited in the United States mail, certified or registered mail, return receipt requested, postage prepaid, addressed to:

LESSEE at: TreePeople
12601 Mulholland Drive
Beverly Hills, CA 90201
Attn: Daniel Berger
CITY at: City of Vernon
4305 South Santa Fe Avenue
Vernon, CA 90058
Attn: City Administration
Either party may change its address for the purpose of this section by giving written notice of the change to the other party in the manner specified in this section. ..

Item 9 Page 9 of 14
TreePeople Lease Agreement

____________________

23. ACCEPTANCE OF ELECTRONIC SIGNATURES. The Parties agree that agreements ancillary to this LEASE and related documents to be entered into in connection with this LEASE will be considered signed when the signature of a party is delivered by electronic transmission.

Such electronic signature will be treated in all respects as having the same effect as an original signature.

24. GOVERNING LAW. This LEASE has been made in and will be construed in accordance with the laws of the State of California and exclusive venue for any action involving this LEASE will be in Los Angeles County.

25. PARTIAL INVALIDITY. Should any provision of this LEASE be held by a court of competent jurisdiction to be either invalid or unenforceable, the remaining provisions of this LEASE will remain in effect, unimpaired by the holding.

26. COUNTERPARTS. This LEASE may be executed in counterparts, each of which is an original but all of which together constitute but one and the same instrument. Signature and acknowledgment pages, if any, of this LEASE may be detached from any counterpart and reattached to any other counterpart of this LEASE which is identical in form hereto but having attached to it one or more additional signature and acknowledgment pages.

27. ATTORNEYS’ FEES. If either party to this LEASE brings an action to enforce the terms hereof or declare rights hereunder, the prevailing party in such action, on trial or appeal, shall be entitled to reasonable attorneys' fees to be paid by the losing party as fixed by the court.

28. DISCLOSURE. Pursuant to California Civil Code section 1938, CITY states that, as of the date of this LEASE, the Premises have not undergone inspection by a “Certified Access Specialist” (“CASp”) to determine whether the Premises meet all applicable construction-related accessibility standards under California Civil Code section 55.53.

29. HEADINGS; EXHIBITS. The section headings in this LEASE are for convenience of reference only and are not to be referred to in construing or interpreting this LEASE. The recitals to this LEASE, and all exhibits referred to in this LEASE, are a part of this LEASE. [Signatures Begin on Next Page].
..

Item 9 Page 10 of 14
TreePeople Lease Agreement

____________________
IN WITNESS WHEREOF, the parties hereto have executed this LEASE as of the day and year first hereinabove written.

FOR TREEPEOPLE, INC.

By:

Name: Daniel Berger
Title:

Date:

Acting CEO
Jan 18, 2024
By:

Name: Daniel Berger
Title:

Date:

Acting CFO
Jan 18, 2024
FOR CITY OF VERNON:

By:

Name: Carlos Fandino, Jr.

Title: City Administrator
Date:

ATTEST:

By:

Lisa Pope, City Clerk
APPROVED AS TO FORM:

By:

Zaynah N. Moussa, City Attorney
..

Item 9 Page 11 of 14
TreePeople Lease Agreement

____________________
Exhibit “A”: Space Description
..

Item 9 Page 12 of 14

CITY OF VERNON
Address : 4530 Bandini
Boulevard
Vernon, CA 90058
APN : 6304-030-903
Lot Area : .28 acres N

EXHIBIT A
..

Item 9 Page 13 of 14
TreePeople Lease Agreement

____________________
Exhibit “B”: Use of Premises
The City of Vernon will allow TreePeople the use of the space described in the Lease Agreement and Exhibit “A”, located at 4530 Bandini Boulevard, City of Vernon CA 90058, subject to the terms and conditions set forth in the parties’ Lease Agreement. TreePeople will use this location to operate as its Southeast/South LA headquarters between the hours of 6am-6pm MondaysSaturdays. Some Sundays as needed.

Space will be used for the following activities: ● Office Space ● Overnight parking for TreePeople Vehicles (up to 7 vehicles plus two trailers) ● Staging area for tree planting/tree distributions ● Tool and equipment storage ● Storage of Mulch pile (located at Southeast corner of parking lot) In exchange for use of the facility, TreePeople commits to the following: ● Assisting the City of Vernon in achieving their annual tree planting goals ● Assist in tree care of recently planted trees within City of Vernon ● Collaboration in securing funding to support tree planting, tree care, and tree distributions within City of Vernon
● Weekly site maintenance (trash, leaf litter, weed control) ● Weekly Office cleaning (sweep, mop, restrooms, dusting) ..

Item 9 Page 14 of 14
City Council Agenda Report
Meeting Date: February 6, 2024
From: Todd Dusenberry, General Manager of Public Utilities Department: Public Utilities
Submitted by: Adriana Ramos, Administrative Analyst
Subject
Renewable Energy Credit Confirmation with Silver Peak Energy, LLC Recommendation
A. Find the action is not in reference to a “project” subject to the California Environmental Quality Act (CEQA) under Guidelines Section 15378 because it involves the continuing administrative activity of purchasing power and resource adequacy; and even if it were a “project” subject to CEQA, the approval requested is exempt in accordance with CEQA Guidelines Section 15061(b)(3), the general rule that CEQA only applies to projects that may have a significant effect on the environment, and any construction that may occur by a private party in the future in reliance on this approval would be subject to CEQA review by another governmental agency at the time when actual details of any physical proposal would be more than speculative; B. Approve, as to form, the Edison Electric Institute Master Power Purchase and Sale Agreement, in substantially the same form as submitted, for the purpose of buying and selling power and resource adequacy consistent with the Transaction Authority as defined in the Energy Risk Management Policy; and
C. Approve and authorize the General Manager of Public Utilities to execute the Renewable Energy Credit Confirmation with Silver Peak Energy, LLC in substantially the same form as submitted, for the Sale and Purchase of Portfolio Content Category Product 1 Energy in the amount-not-to exceed of $1,674,000.

Background
State regulations require that utility providers (utilities) obtain a certain amount of renewable power sources to offset traditional energy sources. In addition to, or as an alternative to, procuring power from renewable sources, in order to meet these renewable requirements, utilities can also purchase Renewable Energy Credits (RECs). RECs demonstrate that electricity was generated from an eligible renewable energy resource and are purchased or sold by eligible entities.

Vernon Public Utilities (VPU) procures power from various sources including a number of projects that are renewable such as the Daggett Solar plus BESS project. Nonetheless, in order to meet its State mandated renewable requirements, VPU must, at times, purchase RECs. The proposed Edison Electric Institute (EEI) Master Power Purchase and Sale Agreement (Master Agreement) and Renewable Energy Credit Confirmation with Silver Peak Energy, LLC (Credit Confirmation) would enable VPU to purchase or sell RECs under the Master Agreement as necessary.

The Master Agreement is a standardized contract used by utilities to govern purchases and sales of wholesale electricity, including RECs. The Agreement standardizes terms and conditions for the purchase, sale, and trading of power for utilities. VPU is seeking approval to purchase RECs from Silver Peak Energy, LLC (Silver Peak Energy) under the general terms and conditions of the Master Agreement. It is to the City’s benefit and in the public interest of the customers and residents of the City to enter into a Credit Confirmation for the Sale and Purchase of Portfolio Content Category Product 1 (PCC1) Energy with Silver Peak Energy for the sale and purchase of RECs between Silver Peak Energy and the City for the purpose of meeting the City’s renewable requirements. Pursuant to Section 4 of the Energy Risk Management Policy (ERMP) adopted by the City Council on November 15, 2022 via Resolution No. 2022-40, all master or ..

Item 10 Page 1 of 64
enabling agreements need to be approved as to form by the Energy Risk Management Committee (ERMC) and by the City Council. On January 31, 2024, the ERMC reviewed and approved the proposed Master Agreement as to form.

The Credit Confirmation outlines the general terms and conditions of the agreement between the City and Silver Peak Energy. The terms of the Credit Confirmation are subject to the Master Agreement, as modified by the Cover Sheet in Exhibit B, and incorporated by reference, all of which form a part of the Master Agreement. Once the Credit Confirmation is fully executed, the City will be able to transact with Silver Peak Energy. The expected term of the Credit Confirmation to purchase RECs from Silver Peak Energy is between March 1, 2024, and June 30, 2024. The maximum limit for the purchase of RECs is 33,480 megawatt-hours (MWh) at $50/MWh. VPU will then own the REC, and thus, can claim to have purchased renewable energy.

It is beneficial to the City, and it is the industry standard to enter into Master and Enabling Agreements that deal with buying and selling power, including RECs. The City will benefit from competitive pricing by purchasing RECs from Silver Peak Energy by entering into this transaction.

All agreements that VPU has established with all counterparties are open-ended, with no expiration date. However, as noted above, the purchase of RECs in this transaction has an expected term of four (4) months. Examples of similar agreements include those by the North American Energy Standards Board (NAESB) and the Western System Power Pool (WSPP) agreements. The NAESB agreement is a contract for the sale and purchase of natural gas with a standardized set of business practices and standards that most buyers and sellers have adopted for their natural gas and electricity transactions. The WSPP agreement is a master agreement used for short-term and term physical and financial transactions with WSPP members.

The key objectives of the Credit Confirmation with Silver Peak Energy include: • Expanding the City’s counterparty pool • Creating an opportunity for better pricing, especially for RECs • Maximizing trading capability Pursuant to Vernon Municipal Code Sections 3.32.110(A)(6) and 3.32.110(B)(1), the proposed Credit Confirmation is exempt from competitive bidding and competitive selection as this contract will be used for the sale and purchase of electricity, including RECs.

Staff recommends the City Council approve, as to form, the standard EEI Master Power Purchase and Sale Agreement for the purpose of buying and selling power and resource adequacy consistent with the Transaction Authority, as defined in Appendix D of the ERMP; and approve the REC Confirmation with Silver Peak Energy in the amount of $1,674,000, which is based on an amount not-to-exceed 33,480 MWh at a contract price of $50/MWh.

The Agreements have been reviewed and approved as to form by the City Attorney’s Office.

Fiscal Impact
The fiscal impact is not-to-exceed $1,674,000. Approval of this action would require an additional appropriation of $1,674,000 for a Transfer Out from the Electric Fund Budget, Resource Management, Natural Gas Expense, Account No. 055-050-590-520160 and a Fund Transfer In the Electric Fund, Resource Management, Renewable Energy Credit, Account No. 055-050-590- 520154...

Item 10 Page 2 of 64
Attachments

1. EEI Master Power Purchase and Sale Agreement

2. Renewable Energy Credit Confirmation with Silver Peak Energy, LLC ..

Item 10 Page 3 of 64
Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association ALL RIGHTS RESERVED UNDER U.S. AND FOREIGN LAW, TREATIES AND CONVENTIONS AUTOMATIC LICENSE – PERMISSION OF THE COPYRIGHT OWNERS IS GRANTED FOR REPRODUCTION BY DOWNLOADING FROM A COMPUTER AND PRINTING ELECTRONIC COPIES OF THE WORK. NO AUTHORIZED COPY MAY BE SOLD. THE INDUSTRY IS ENCOURAGED TO USE THIS MASTER POWER PURCHASE AND SALE AGREEMENT IN ITS TRANSACTIONS.

ATTRIBUTION TO THE COPYRIGHT OWNERS IS REQUESTED.

Master Power
Purchase & Sale
Agreement

..

Item 10 Page 4 of 64
i
Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

MASTER POWER PURCHASE AND SALES AGREEMENT

TABLE OF CONTENTS
COVER SHEET...............................................................................................................................1 GENERAL TERMS AND CONDITIONS .....................................................................................6 ARTICLE ONE: GENERAL DEFINITIONS.........................................................................6 ARTICLE TWO: TRANSACTION TERMS AND CONDITIONS......................................11

2.1 Transactions...........................................................................................................11

2.2 Governing Terms...................................................................................................11

2.3 Confirmation..........................................................................................................11

2.4 Additional Confirmation Terms.............................................................................12

2.5 Recording...............................................................................................................12 ARTICLE THREE: OBLIGATIONS AND DELIVERIES.......................................................12

3.1 Seller’s and Buyer’s Obligations...........................................................................12

3.2 Transmission and Scheduling ................................................................................12

3.3 Force Majeure ........................................................................................................13 ARTICLE FOUR: REMEDIES FOR FAILURE TO DELIVER/RECEIVE ..........................13

4.1 Seller Failure..........................................................................................................13

4.2 Buyer Failure .........................................................................................................13 ARTICLE FIVE: EVENTS OF DEFAULT; REMEDIES.....................................................13

5.1 Events of Default ...................................................................................................13

5.2 Declaration of an Early Termination Date and Calculation of Settlement Amounts.................................................................................................................15

5.3 Net Out of Settlement Amounts.............................................................................15

5.4 Notice of Payment of Termination Payment .........................................................15

5.5 Disputes With Respect to Termination Payment...................................................15

5.6 Closeout Setoffs.....................................................................................................16

5.7 Suspension of Performance....................................................................................16 ARTICLE SIX: PAYMENT AND NETTING ....................................................................16

6.1 Billing Period.........................................................................................................16

6.2 Timeliness of Payment...........................................................................................17

6.3 Disputes and Adjustments of Invoices...................................................................17

6.4 Netting of Payments...............................................................................................17

6.5 Payment Obligation Absent Netting ......................................................................17

6.6 Security ..................................................................................................................18

6.7 Payment for Options..............................................................................................18

6.8 Transaction Netting................................................................................................18 ..

Item 10 Page 5 of 64
ii
Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association ARTICLE SEVEN: LIMITATIONS..........................................................................................18

7.1 Limitation of Remedies, Liability and Damages...................................................18 ARTICLE EIGHT: CREDIT AND COLLATERAL REQUIREMENTS ................................19

8.1 Party A Credit Protection.......................................................................................19

8.2 Party B Credit Protection.......................................................................................21

8.3 Grant of Security Interest/Remedies......................................................................22 ARTICLE NINE: GOVERNMENTAL CHARGES...............................................................23

9.1 Cooperation............................................................................................................23

9.2 Governmental Charges...........................................................................................23 ARTICLE TEN: MISCELLANEOUS ..................................................................................23

10.1 Term of Master Agreement....................................................................................23

10.2 Representations and Warranties.............................................................................23

10.3 Title and Risk of Loss............................................................................................25

10.4 Indemnity ...............................................................................................................25

10.5 Assignment ............................................................................................................25

10.6 Governing Law ......................................................................................................25

10.7 Notices ...................................................................................................................26

10.8 General...................................................................................................................26

10.9 Audit ......................................................................................................................26

10.10 Forward Contract ...................................................................................................27

10.11 Confidentiality .......................................................................................................27 SCHEDULE M: GOVERNMENTAL ENTITY OR PUBLIC POWER SYSTEMS ..................28 SCHEDULE P: PRODUCTS AND RELATED DEFINITIONS.................................................32 EXHIBIT A: CONFIRMATION LETTER..................................................................................39 ..

Item 10 Page 6 of 64
1 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

MASTER POWER PURCHASE AND SALE AGREEMENT

COVER SHEET
This Master Power Purchase and Sale Agreement (“Master Agreement” ) is made as of the following date:
_________________ (“Effective Date”). The Master Agreement, together with the exhibits, schedules and any written supplements hereto, the Party A Tariff, if any, the Party B Tariff, if any, any designated collateral, credit support or margin agreement or similar arrangement between the Parties and all Transactions (including any confirmations accepted in accordance with Section 2.3 hereto) shall be referred to as the “Agreement.” The Parties to this Master Agreement are the following:

Name (“__________________” or “Party A”) Name (“Counterparty” or “Party B”) All Notices: All Notices:

Street: Street:

City: Zip: City: Zip:

Attn: Contract Administration
Phone:

Facsimile:

Duns:

Federal Tax ID Number:

Attn: Contract Administration
Phone:

Facsimile:

Duns:

Federal Tax ID Number:

Invoices:

Attn:

Phone:

Facsimile:

Invoices:

Attn:

Phone:

Facsimile:

Scheduling:

Attn:

Phone:

Facsimile:

Scheduling:

Attn:

Phone:

Facsimile:

Payments:

Attn:

Phone:

Facsimile:

Payments:

Attn:

Phone:

Facsimile:

Wire Transfer:

BNK:

ABA:

ACCT:

Wire Transfer:

BNK:

ABA:

ACCT:

Credit and Collections:

Attn:

Phone:

Facsimile:

Credit and Collections:

Attn:

Phone:

Facsimile:

With additional Notices of an Event of Default or
Potential Event of Default to:

Attn:

Phone:

Facsimile:

With additional Notices of an Event of Default or
Potential Event of Default to:

Attn:

Phone:

Facsimile:
..

Item 10 Page 7 of 64
2 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association The Parties hereby agree that the General Terms and Conditions are incorporated herein, and to the following provisions as provided for in the General Terms and Conditions:

Party A Tariff Tariff Dated Docket Number
Party B Tariff Tariff Dated Docket Number
Article Two
Transaction Terms and Conditions [] Optional provision in Section 2.4. If not checked, inapplicable.

Article Four
Remedies for Failure
to Deliver or Receive
[] Accelerated Payment of Damages. If not checked, inapplicable.

Article Five [] Cross Default for Party A:

Events of Default; Remedies [] Party A: Cross Default Amount $ [] Other Entity: Cross Default Amount $
[] Cross Default for Party B:
[] Party B: Cross Default Amount $
[] Other Entity: Cross Default Amount $

5.6 Closeout Setoff
[] Option A (Applicable if no other selection is made.) [] Option B - Affiliates shall have the meaning set forth in the Agreement unless otherwise specified as follows:
[] Option C (No Setoff)
Article 8 8.1 Party A Credit Protection:

Credit and Collateral Requirements (a) Financial Information:
[] Option A
[] Option B Specify:
[] Option C Specify:
(b) Credit Assurances:
[] Not Applicable
[] Applicable
(c) Collateral Threshold:
[] Not Applicable
[] Applicable
..

Item 10 Page 8 of 64
3 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association If applicable, complete the following:

Party B Collateral Threshold: $ __________; provided, however, that Party B’s Collateral Threshold shall be zero if an Event of Default or Potential Event of Default with respect to Party B has occurred and is continuing.

Party B Independent Amount: $
Party B Rounding Amount: $
(d) Downgrade Event:
[] Not Applicable
[] Applicable
If applicable, complete the following:
[] It shall be a Downgrade Event for Party B if Party B’s Credit Rating falls below __________ from S&P or __________ from Moody’s or if Party B is not rated by either S&P or Moody’s [] Other:

Specify:
(e) Guarantor for Party B:

Guarantee Amount:

8.2 Party B Credit Protection:
(a) Financial Information:
[] Option A
[] Option B Specify:
[] Option C Specify:
(b) Credit Assurances:
[] Not Applicable
[] Applicable
(c) Collateral Threshold:
[] Not Applicable
[] Applicable
If applicable, complete the following:

Party A Collateral Threshold: $ __________; provided, however, that Party A’s Collateral Threshold shall be zero if an Event of Default or Potential Event of Default with respect to Party A has occurred and is continuing.

Party A Independent Amount: $
Party A Rounding Amount: $
..

Item 10 Page 9 of 64
4 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association (d) Downgrade Event:
[] Not Applicable
[] Applicable
If applicable, complete the following:
[] It shall be a Downgrade Event for Party A if Party A’s Credit Rating falls below __________ from S&P or __________ from Moody’s or if Party A is not rated by either S&P or Moody’s [] Other:

Specify:
(e) Guarantor for Party A:

Guarantee Amount:

Article 10
Confidentiality [] Confidentiality Applicable If not checked, inapplicable.

Schedule M
[] Party A is a Governmental Entity or Public Power System [] Party B is a Governmental Entity or Public Power System [] Add Section 3.6. If not checked, inapplicable
[] Add Section 8.6. If not checked, inapplicable
Other Changes Specify, if any: ..

Item 10 Page 10 of 64
5 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association IN WITNESS WHEREOF, the Parties have caused this Master Agreement to be duly executed as of the date first above written.

Party A Name Party B Name
By: By:

Name: Name:

Title: Title:

DISCLAIMER: This Master Power Purchase and Sale Agreement was prepared by a committee of representatives of Edison Electric Institute (“EEI”) and National Energy Marketers Association (“NEM”) member companies to facilitate orderly trading in and development of wholesale power markets. Neither EEI nor NEM nor any member company nor any of their agents, representatives or attorneys shall be responsible for its use, or any damages resulting therefrom. By providing this Agreement EEI and NEM do not offer legal advice and all users are urged to consult their own legal counsel to ensure that their commercial objectives will be achieved and their legal interests are adequately protected. ..

Item 10 Page 11 of 64
6 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

GENERAL TERMS AND CONDITIONS
ARTICLE ONE: GENERAL DEFINITIONS

1.1 “Affiliate” means, with respect to any person, any other person (other than an individual) that, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, such person. For this purpose, “control” means the direct or indirect ownership of fifty percent (50%) or more of the outstanding capital stock or other equity interests having ordinary voting power.

1.2 “Agreement” has the meaning set forth in the Cover Sheet.

1.3 “Bankrupt” means with respect to any entity, such entity (i) files a petition or otherwise commences, authorizes or acquiesces in the commencement of a proceeding or cause of action under any bankruptcy, insolvency, reorganization or similar law, or has any such petition filed or commenced against it, (ii) makes an assignment or any general arrangement for the benefit of creditors, (iii) otherwise becomes bankrupt or insolvent (however evidenced), (iv) has a liquidator, administrator, receiver, trustee, conservator or similar official appointed with respect to it or any substantial portion of its property or assets, or (v) is generally unable to pay its debts as they fall due.

1.4 “Business Day” means any day except a Saturday, Sunday, or a Federal Reserve Bank holiday. A Business Day shall open at 8:00 a.m. and close at 5:00 p.m. local time for the relevant Party’s principal place of business. The relevant Party, in each instance unless otherwise specified, shall be the Party from whom the notice, payment or delivery is being sent and by whom the notice or payment or delivery is to be received.

1.5 “Buyer” means the Party to a Transaction that is obligated to purchase and receive, or cause to be received, the Product, as specified in the Transaction.

1.6 “Call Option” means an Option entitling, but not obligating, the Option Buyer to purchase and receive the Product from the Option Seller at a price equal to the Strike Price for the Delivery Period for which the Option may be exercised, all as specified in the Transaction.

Upon proper exercise of the Option by the Option Buyer, the Option Seller will be obligated to sell and deliver the Product for the Delivery Period for which the Option has been exercised.

1.7 “Claiming Party” has the meaning set forth in Section 3.3.

1.8 “Claims” means all third party claims or actions, threatened or filed and, whether groundless, false, fraudulent or otherwise, that directly or indirectly relate to the subject matter of an indemnity, and the resulting losses, damages, expenses, attorneys’ fees and court costs, whether incurred by settlement or otherwise, and whether such claims or actions are threatened or filed prior to or after the termination of this Agreement.

1.9 “Confirmation” has the meaning set forth in Section 2.3. ..

Item 10 Page 12 of 64
7 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

1.10 “Contract Price” means the price in $U.S. (unless otherwise provided for) to be paid by Buyer to Seller for the purchase of the Product, as specified in the Transaction.

1.11 “Costs” means, with respect to the Non-Defaulting Party, brokerage fees, commissions and other similar third party transaction costs and expenses reasonably incurred by such Party either in terminating any arrangement pursuant to which it has hedged its obligations or entering into new arrangements which replace a Terminated Transaction; and all reasonable attorneys’ fees and expenses incurred by the Non-Defaulting Party in connection with the termination of a Transaction.

1.12 “Credit Rating” means, with respect to any entity, the rating then assigned to such entity’s unsecured, senior long-term debt obligations (not supported by third party credit enhancements) or if such entity does not have a rating for its senior unsecured long-term debt, then the rating then assigned to such entity as an issues rating by S&P, Moody’s or any other rating agency agreed by the Parties as set forth in the Cover Sheet.

1.13 “Cross Default Amount” means the cross default amount, if any, set forth in the Cover Sheet for a Party.

1.14 “Defaulting Party” has the meaning set forth in Section 5.1.

1.15 “Delivery Period” means the period of delivery for a Transaction, as specified in the Transaction.

1.16 “Delivery Point” means the point at which the Product will be delivered and received, as specified in the Transaction.

1.17 “Downgrade Event” has the meaning set forth on the Cover Sheet.

1.18 “Early Termination Date” has the meaning set forth in Section 5.2.

1.19 “Effective Date” has the meaning set forth on the Cover Sheet.

1.20 “Equitable Defenses” means any bankruptcy, insolvency, reorganization and other laws affecting creditors’ rights generally, and with regard to equitable remedies, the discretion of the court before which proceedings to obtain same may be pending.

1.21 “Event of Default” has the meaning set forth in Section 5.1.

1.22 “FERC” means the Federal Energy Regulatory Commission or any successor government agency.

1.23 “Force Majeure” means an event or circumstance which prevents one Party from performing its obligations under one or more Transactions, which event or circumstance was not anticipated as of the date the Transaction was agreed to, which is not within the reasonable control of, or the result of the negligence of, the Claiming Party, and which, by the exercise of due diligence, the Claiming Party is unable to overcome or avoid or cause to be avoided. Force Majeure shall not be based on (i) the loss of Buyer’s markets; (ii) Buyer’s inability economically ..

Item 10 Page 13 of 64
8 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association to use or resell the Product purchased hereunder; (iii) the loss or failure of Seller’s supply; or (iv) Seller’s ability to sell the Product at a price greater than the Contract Price. Neither Party may raise a claim of Force Majeure based in whole or in part on curtailment by a Transmission Provider unless (i) such Party has contracted for firm transmission with a Transmission Provider for the Product to be delivered to or received at the Delivery Point and (ii) such curtailment is due to “force majeure” or “uncontrollable force” or a similar term as defined under the Transmission Provider’s tariff; provided, however, that existence of the foregoing factors shall not be sufficient to conclusively or presumptively prove the existence of a Force Majeure absent a showing of other facts and circumstances which in the aggregate with such factors establish that a Force Majeure as defined in the first sentence hereof has occurred. The applicability of Force Majeure to the Transaction is governed by the terms of the Products and Related Definitions contained in Schedule P.

1.24 “Gains” means, with respect to any Party, an amount equal to the present value of the economic benefit to it, if any (exclusive of Costs), resulting from the termination of a Terminated Transaction, determined in a commercially reasonable manner.

1.25 “Guarantor” means, with respect to a Party, the guarantor, if any, specified for such Party on the Cover Sheet.

1.26 “Interest Rate” means, for any date, the lesser of (a) the per annum rate of interest equal to the prime lending rate as may from time to time be published in The Wall Street Journal under “Money Rates” on such day (or if not published on such day on the most recent preceding day on which published), plus two percent (2%) and (b) the maximum rate permitted by applicable law.

1.27 “Letter(s) of Credit” means one or more irrevocable, transferable standby letters of credit issued by a U.S. commercial bank or a foreign bank with a U.S. branch with such bank having a credit rating of at least A- from S&P or A3 from Moody’s, in a form acceptable to the Party in whose favor the letter of credit is issued. Costs of a Letter of Credit shall be borne by the applicant for such Letter of Credit.

1.28 “Losses” means, with respect to any Party, an amount equal to the present value of the economic loss to it, if any (exclusive of Costs), resulting from termination of a Terminated Transaction, determined in a commercially reasonable manner.

1.29 “Master Agreement” has the meaning set forth on the Cover Sheet.

1.30 “Moody’s” means Moody’s Investor Services, Inc. or its successor.

1.31 “NERC Business Day” means any day except a Saturday, Sunday or a holiday as defined by the North American Electric Reliability Council or any successor organization thereto. A NERC Business Day shall open at 8:00 a.m. and close at 5:00 p.m. local time for the relevant Party’s principal place of business. The relevant Party, in each instance unless otherwise specified, shall be the Party from whom the notice, payment or delivery is being sent and by whom the notice or payment or delivery is to be received. ..

Item 10 Page 14 of 64
9 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

1.32 “Non-Defaulting Party” has the meaning set forth in Section 5.2.

1.33 “Offsetting Transactions” mean any two or more outstanding Transactions, having the same or overlapping Delivery Period(s), Delivery Point and payment date, where under one or more of such Transactions, one Party is the Seller, and under the other such Transaction(s), the same Party is the Buyer.

1.34 “Option” means the right but not the obligation to purchase or sell a Product as specified in a Transaction.

1.35 “Option Buyer” means the Party specified in a Transaction as the purchaser of an option, as defined in Schedule P.

1.36 “Option Seller” means the Party specified in a Transaction as the seller of an option , as defined in Schedule P.

1.37 “Party A Collateral Threshold” means the collateral threshold, if any, set forth in the Cover Sheet for Party A.

1.38 “Party B Collateral Threshold” means the collateral threshold, if any, set forth in the Cover Sheet for Party B.

1.39 “Party A Independent Amount” means the amount , if any, set forth in the Cover Sheet for Party A.

1.40 “Party B Independent Amount” means the amount , if any, set forth in the Cover Sheet for Party B.

1.41 “Party A Rounding Amount” means the amount, if any, set forth in the Cover Sheet for Party A.

1.42 “Party B Rounding Amount” means the amount, if any, set forth in the Cover Sheet for Party B.

1.43 “Party A Tariff” means the tariff, if any, specified in the Cover Sheet for Party A.

1.44 “Party B Tariff” means the tariff, if any, specified in the Cover Sheet for Party B.

1.45 “Performance Assurance” means collateral in the form of either cash, Letter(s) of Credit, or other security acceptable to the Requesting Party.

1.46 “Potential Event of Default” means an event which, with notice or passage of time or both, would constitute an Event of Default.

1.47 “Product” means electric capacity, energy or other product(s) related thereto as specified in a Transaction by reference to a Product listed in Schedule P hereto or as otherwise specified by the Parties in the Transaction. ..

Item 10 Page 15 of 64
10 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

1.48 “Put Option” means an Option entitling, but not obligating, the Option Buyer to sell and deliver the Product to the Option Seller at a price equal to the Strike Price for the Delivery Period for which the option may be exercised, all as specified in a Transaction. Upon proper exercise of the Option by the Option Buyer, the Option Seller will be obligated to purchase and receive the Product.

1.49 “Quantity” means that quantity of the Product that Seller agrees to make available or sell and deliver, or cause to be delivered, to Buyer, and that Buyer agrees to purchase and receive, or cause to be received, from Seller as specified in the Transaction.

1.50 “Recording” has the meaning set forth in Section 2.4.

1.51 “Replacement Price” means the price at which Buyer, acting in a commercially reasonable manner, purchases at the Delivery Point a replacement for any Product specified in a Transaction but not delivered by Seller, plus (i) costs reasonably incurred by Buyer in purchasing such substitute Product and (ii) additional transmission charges, if any, reasonably incurred by Buyer to the Delivery Point, or at Buyer’s option, the market price at the Delivery Point for such Product not delivered as determined by Buyer in a commercially reasonable manner; provided, however, in no event shall such price include any penalties, ratcheted demand or similar charges, nor shall Buyer be required to utilize or change its utilization of its owned or controlled assets or market positions to minimize Seller’s liability. For the purposes of this definition, Buyer shall be considered to have purchased replacement Product to the extent Buyer shall have entered into one or more arrangements in a commercially reasonable manner whereby Buyer repurchases its obligation to sell and deliver the Product to another party at the Delivery Point.

1.52 “S&P” means the Standard & Poor’s Rating Group (a division of McGraw-Hill, Inc.) or its successor.

1.53 “Sales Price” means the price at which Seller, acting in a commercially reasonable manner, resells at the Delivery Point any Product not received by Buyer, deducting from such proceeds any (i) costs reasonably incurred by Seller in reselling such Product and (ii) additional transmission charges, if any, reasonably incurred by Seller in delivering such Product to the third party purchasers, or at Seller’s option, the market price at the Delivery Point for such Product not received as determined by Seller in a commercially reasonable manner; provided, however, in no event shall such price include any penalties, ratcheted demand or similar charges, nor shall Seller be required to utilize or change its utilization of its owned or controlled assets, including contractual assets, or market positions to minimize Buyer’s liability. For purposes of this definition, Seller shall be considered to have resold such Product to the extent Seller shall have entered into one or more arrangements in a commercially reasonable manner whereby Seller repurchases its obligation to purchase and receive the Product from another party at the Delivery Point.

1.54 “Schedule” or “Scheduling” means the actions of Seller, Buyer and/or their designated representatives, including each Party’s Transmission Providers, if applicable, of notifying, requesting and confirming to each other the quantity and type of Product to be delivered on any given day or days during the Delivery Period at a specified Delivery Point. ..

Item 10 Page 16 of 64
11 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

1.55 “Seller” means the Party to a Transaction that is obligated to sell and deliver, or cause to be delivered, the Product, as specified in the Transaction.

1.56 “Settlement Amount” means, with respect to a Transaction and the Non- Defaulting Party, the Losses or Gains, and Costs, expressed in U.S. Dollars, which such party incurs as a result of the liquidation of a Terminated Transaction pursuant to Section 5.2.

1.57 “Strike Price” means the price to be paid for the purchase of the Product pursuant to an Option.

1.58 “Terminated Transaction” has the meaning set forth in Section 5.2.

1.59 “Termination Payment” has the meaning set forth in Section 5.3.

1.60 “Transaction” means a particular transaction agreed to by the Parties relating to the sale and purchase of a Product pursuant to this Master Agreement.

1.61 “Transmission Provider” means any entity or entities transmitting or transporting the Product on behalf of Seller or Buyer to or from the Delivery Point in a particular Transaction.

ARTICLE TWO: TRANSACTION TERMS AND CONDITIONS

2.1 Transactions. A Transaction shall be entered into upon agreement of the Parties orally or, if expressly required by either Party with respect to a particular Transaction, in writing, including an electronic means of communication. Each Party agrees not to contest, or assert any defense to, the validity or enforceability of the Transaction entered into in accordance with this Master Agreement (i) based on any law requiring agreements to be in writing or to be signed by the parties, or (ii) based on any lack of authority of the Party or any lack of authority of any employee of the Party to enter into a Transaction.

2.2 Governing Terms. Unless otherwise specifically agreed, each Transaction between the Parties shall be governed by this Master Agreement. This Master Agreement (including all exhibits, schedules and any written supplements hereto), , the Party A Tariff, if any, and the Party B Tariff, if any, any designated collateral, credit support or margin agreement or similar arrangement between the Parties and all Transactions (including any Confirmations accepted in accordance with Section 2.3) shall form a single integrated agreement between the Parties. Any inconsistency between any terms of this Master Agreement and any terms of the Transaction shall be resolved in favor of the terms of such Transaction.

2.3 Confirmation. Seller may confirm a Transaction by forwarding to Buyer by facsimile within three (3) Business Days after the Transaction is entered into a confirmation (“Confirmation”) substantially in the form of Exhibit A. If Buyer objects to any term(s) of such Confirmation, Buyer shall notify Seller in writing of such objections within two (2) Business Days of Buyer’s receipt thereof, failing which Buyer shall be deemed to have accepted the terms as sent. If Seller fails to send a Confirmation within three (3) Business Days after the Transaction is entered into, a Confirmation substantially in the form of Exhibit A, may be forwarded by Buyer to Seller. If Seller objects to any term(s) of such Confirmation, Seller shall notify Buyer of such objections within two (2) Business Days of Seller’s receipt thereof, failing ..

Item 10 Page 17 of 64
12 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association which Seller shall be deemed to have accepted the terms as sent. If Seller and Buyer each send a Confirmation and neither Party objects to the other Party’s Confirmation within two (2) Business Days of receipt, Seller’s Confirmation shall be deemed to be accepted and shall be the controlling Confirmation, unless (i) Seller’s Confirmation was sent more than three (3) Business Days after the Transaction was entered into and (ii) Buyer’s Confirmation was sent prior to Seller’s Confirmation, in which case Buyer’s Confirmation shall be deemed to be accepted and shall be the controlling Confirmation. Failure by either Party to send or either Party to return an executed Confirmation or any objection by either Party shall not invalidate the Transaction agreed to by the Parties.

2.4 Additional Confirmation Terms. If the Parties have elected on the Cover Sheet to make this Section 2.4 applicable to this Master Agreement, when a Confirmation contains provisions, other than those provisions relating to the commercial terms of the Transaction (e.g., price or special transmission conditions), which modify or supplement the general terms and conditions of this Master Agreement (e.g., arbitration provisions or additional representations and warranties), such provisions shall not be deemed to be accepted pursuant to Section 2.3 unless agreed to either orally or in writing by the Parties; provided that the foregoing shall not invalidate any Transaction agreed to by the Parties.

2.5 Recording. Unless a Party expressly objects to a Recording (defined below) at the beginning of a telephone conversation, each Party consents to the creation of a tape or electronic recording (“Recording”) of all telephone conversations between the Parties to this Master Agreement, and that any such Recordings will be retained in confidence, secured from improper access, and may be submitted in evidence in any proceeding or action relating to this Agreement.

Each Party waives any further notice of such monitoring or recording, and agrees to notify its officers and employees of such monitoring or recording and to obtain any necessary consent of such officers and employees. The Recording, and the terms and conditions described therein, if admissible, shall be the controlling evidence for the Parties’ agreement with respect to a particular Transaction in the event a Confirmation is not fully executed (or deemed accepted) by both Parties. Upon full execution (or deemed acceptance) of a Confirmation, such Confirmation shall control in the event of any conflict with the terms of a Recording, or in the event of any conflict with the terms of this Master Agreement.

ARTICLE THREE: OBLIGATIONS AND DELIVERIES

3.1 Seller’s and Buyer’s Obligations. With respect to each Transaction, Seller shall sell and deliver, or cause to be delivered, and Buyer shall purchase and receive, or cause to be received, the Quantity of the Product at the Delivery Point, and Buyer shall pay Seller the Contract Price; provided, however, with respect to Options, the obligations set forth in the preceding sentence shall only arise if the Option Buyer exercises its Option in accordance with its terms. Seller shall be responsible for any costs or charges imposed on or associated with the Product or its delivery of the Product up to the Delivery Point. Buyer shall be responsible for any costs or charges imposed on or associated with the Product or its receipt at and from the Delivery Point.

3.2 Transmission and Scheduling. Seller shall arrange and be responsible for transmission service to the Delivery Point and shall Schedule or arrange for Scheduling services ..

Item 10 Page 18 of 64
13 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association with its Transmission Providers, as specified by the Parties in the Transaction, or in the absence thereof, in accordance with the practice of the Transmission Providers, to deliver the Product to the Delivery Point. Buyer shall arrange and be responsible for transmission service at and from the Delivery Point and shall Schedule or arrange for Scheduling services with its Transmission Providers to receive the Product at the Delivery Point.

3.3 Force Majeure. To the extent either Party is prevented by Force Majeure from carrying out, in whole or part, its obligations under the Transaction and such Party (the “Claiming Party”) gives notice and details of the Force Majeure to the other Party as soon as practicable, then, unless the terms of the Product specify otherwise, the Claiming Party shall be excused from the performance of its obligations with respect to such Transaction (other than the obligation to make payments then due or becoming due with respect to performance prior to the Force Majeure). The Claiming Party shall remedy the Force Majeure with all reasonable dispatch. The non-Claiming Party shall not be required to perform or resume performance of its obligations to the Claiming Party corresponding to the obligations of the Claiming Party excused by Force Majeure.

ARTICLE FOUR: REMEDIES FOR FAILURE TO DELIVER/RECEIVE

4.1 Seller Failure. If Seller fails to schedule and/or deliver all or part of the Product pursuant to a Transaction, and such failure is not excused under the terms of the Product or by Buyer’s failure to perform, then Seller shall pay Buyer, on the date payment would otherwise be due in respect of the month in which the failure occurred or, if “Accelerated Payment of Damages” is specified on the Cover Sheet, within five (5) Business Days of invoice receipt, an amount for such deficiency equal to the positive difference, if any, obtained by subtracting the Contract Price from the Replacement Price. The invoice for such amount shall include a written statement explaining in reasonable detail the calculation of such amount.

4.2 Buyer Failure. If Buyer fails to schedule and/or receive all or part of the Product pursuant to a Transaction and such failure is not excused under the terms of the Product or by Seller’s failure to perform, then Buyer shall pay Seller, on the date payment would otherwise be due in respect of the month in which the failure occurred or, if “Accelerated Payment of Damages” is specified on the Cover Sheet, within five (5) Business Days of invoice receipt, an amount for such deficiency equal to the positive difference, if any, obtained by subtracting the Sales Price from the Contract Price. The invoice for such amount shall include a written statement explaining in reasonable detail the calculation of such amount.

ARTICLE FIVE: EVENTS OF DEFAULT; REMEDIES

5.1 Events of Default. An “Event of Default” shall mean, with respect to a Party (a “Defaulting Party”), the occurrence of any of the following:
(a) the failure to make, when due, any payment required pursuant to this Agreement if such failure is not remedied within three (3) Business Days after written notice;
..

Item 10 Page 19 of 64
14 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association (b) any representation or warranty made by such Party herein is false or misleading in any material respect when made or when deemed made or repeated;
(c) the failure to perform any material covenant or obligation set forth in this Agreement (except to the extent constituting a separate Event of Default, and except for such Party’s obligations to deliver or receive the Product, the exclusive remedy for which is provided in Article Four) if such failure is not remedied within three (3) Business Days after written notice; (d) such Party becomes Bankrupt;
(e) the failure of such Party to satisfy the creditworthiness/collateral requirements agreed to pursuant to Article Eight hereof; (f) such Party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all of its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer, the resulting, surviving or transferee entity fails to assume all the obligations of such Party under this Agreement to which it or its predecessor was a party by operation of law or pursuant to an agreement reasonably satisfactory to the other Party;
(g) if the applicable cross default section in the Cover Sheet is indicated for such Party, the occurrence and continuation of (i) a default, event of default or other similar condition or event in respect of such Party or any other party specified in the Cover Sheet for such Party under one or more agreements or instruments, individually or collectively, relating to indebtedness for borrowed money in an aggregate amount of not less than the applicable Cross Default Amount (as specified in the Cover Sheet), which results in such indebtedness becoming, or becoming capable at such time of being declared, immediately due and payable or (ii) a default by such Party or any other party specified in the Cover Sheet for such Party in making on the due date therefor one or more payments, individually or collectively, in an aggregate amount of not less than the applicable Cross Default Amount (as specified in the Cover Sheet);
(h) with respect to such Party’s Guarantor, if any:
(i) if any representation or warranty made by a Guarantor in connection with this Agreement is false or misleading in any material respect when made or when deemed made or repeated; (ii) the failure of a Guarantor to make any payment required or to perform any other material covenant or obligation in any guaranty made in connection with this Agreement and such failure shall not be remedied within three (3) Business Days after written notice; ..

Item 10 Page 20 of 64
15 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association (iii) a Guarantor becomes Bankrupt;
(iv) the failure of a Guarantor’s guaranty to be in full force and effect for purposes of this Agreement (other than in accordance with its terms) prior to the satisfaction of all obligations of such Party under each Transaction to which such guaranty shall relate without the written consent of the other Party; or
(v) a Guarantor shall repudiate, disaffirm, disclaim, or reject, in whole or in part, or challenge the validity of any guaranty.

5.2 Declaration of an Early Termination Date and Calculation of Settlement Amounts. If an Event of Default with respect to a Defaulting Party shall have occurred and be continuing, the other Party (the “Non-Defaulting Party”) shall have the right (i) to designate a day, no earlier than the day such notice is effective and no later than 20 days after such notice is effective, as an early termination date (“Early Termination Date”) to accelerate all amounts owing between the Parties and to liquidate and terminate all, but not less than all, Transactions (each referred to as a “Terminated Transaction”) between the Parties, (ii) withhold any payments due to the Defaulting Party under this Agreement and (iii) suspend performance. The Non- Defaulting Party shall calculate, in a commercially reasonable manner, a Settlement Amount for each such Terminated Transaction as of the Early Termination Date (or, to the extent that in the reasonable opinion of the Non-Defaulting Party certain of such Terminated Transactions are commercially impracticable to liquidate and terminate or may not be liquidated and terminated under applicable law on the Early Termination Date, as soon thereafter as is reasonably practicable).

5.3 Net Out of Settlement Amounts. The Non-Defaulting Party shall aggregate all Settlement Amounts into a single amount by: netting out (a) all Settlement Amounts that are due to the Defaulting Party, plus, at the option of the Non-Defaulting Party, any cash or other form of security then available to the Non-Defaulting Party pursuant to Article Eight, plus any or all other amounts due to the Defaulting Party under this Agreement against (b) all Settlement Amounts that are due to the Non-Defaulting Party, plus any or all other amounts due to the Non- Defaulting Party under this Agreement, so that all such amounts shall be netted out to a single liquidated amount (the “Termination Payment”) payable by one Party to the other. The Termination Payment shall be due to or due from the Non-Defaulting Party as appropriate.

5.4 Notice of Payment of Termination Payment. As soon as practicable after a liquidation, notice shall be given by the Non-Defaulting Party to the Defaulting Party of the amount of the Termination Payment and whether the Termination Payment is due to or due from the Non-Defaulting Party. The notice shall include a written statement explaining in reasonable detail the calculation of such amount. The Termination Payment shall be made by the Party that owes it within two (2) Business Days after such notice is effective.

5.5 Disputes With Respect to Termination Payment. If the Defaulting Party disputes the Non-Defaulting Party’s calculation of the Termination Payment, in whole or in part, the Defaulting Party shall, within two (2) Business Days of receipt of Non-Defaulting Party’s calculation of the Termination Payment, provide to the Non-Defaulting Party a detailed written ..

Item 10 Page 21 of 64
16 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association explanation of the basis for such dispute; provided, however, that if the Termination Payment is due from the Defaulting Party, the Defaulting Party shall first transfer Performance Assurance to the Non-Defaulting Party in an amount equal to the Termination Payment.

5.6 Closeout Setoffs.

Option A: After calculation of a Termination Payment in accordance with Section 5.3, if the Defaulting Party would be owed the Termination Payment, the Non-Defaulting Party shall be entitled, at its option and in its discretion, to (i) set off against such Termination Payment any amounts due and owing by the Defaulting Party to the Non-Defaulting Party under any other agreements, instruments or undertakings between the Defaulting Party and the Non-Defaulting Party and/or (ii) to the extent the Transactions are not yet liquidated in accordance with Section

5.2, withhold payment of the Termination Payment to the Defaulting Party. The remedy provided for in this Section shall be without prejudice and in addition to any right of setoff, combination of accounts, lien or other right to which any Party is at any time otherwise entitled (whether by operation of law, contract or otherwise).

Option B: After calculation of a Termination Payment in accordance with Section 5.3, if the Defaulting Party would be owed the Termination Payment, the Non-Defaulting Party shall be entitled, at its option and in its discretion, to (i) set off against such Termination Payment any amounts due and owing by the Defaulting Party or any of its Affiliates to the Non-Defaulting Party or any of its Affiliates under any other agreements, instruments or undertakings between the Defaulting Party or any of its Affiliates and the Non-Defaulting Party or any of its Affiliates and/or (ii) to the extent the Transactions are not yet liquidated in accordance with Section 5.2, withhold payment of the Termination Payment to the Defaulting Party. The remedy provided for in this Section shall be without prejudice and in addition to any right of setoff, combination of accounts, lien or other right to which any Party is at any time otherwise entitled (whether by operation of law, contract or otherwise).

Option C: Neither Option A nor B shall apply.

5.7 Suspension of Performance. Notwithstanding any other provision of this Master Agreement, if (a) an Event of Default or (b) a Potential Event of Default shall have occurred and be continuing, the Non-Defaulting Party, upon written notice to the Defaulting Party, shall have the right (i) to suspend performance under any or all Transactions; provided, however, in no event shall any such suspension continue for longer than ten (10) NERC Business Days with respect to any single Transaction unless an early Termination Date shall have been declared and notice thereof pursuant to Section 5.2 given, and (ii) to the extent an Event of Default shall have occurred and be continuing to exercise any remedy available at law or in equity.

ARTICLE SIX: PAYMENT AND NETTING

6.1 Billing Period. Unless otherwise specifically agreed upon by the Parties in a Transaction, the calendar month shall be the standard period for all payments under this Agreement (other than Termination Payments and, if “Accelerated Payment of Damages” is specified by the Parties in the Cover Sheet, payments pursuant to Section 4.1 or 4.2 and Option premium payments pursuant to Section 6.7). As soon as practicable after the end of each month, ..

Item 10 Page 22 of 64
17 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association each Party will render to the other Party an invoice for the payment obligations, if any, incurred hereunder during the preceding month.

6.2 Timeliness of Payment. Unless otherwise agreed by the Parties in a Transaction, all invoices under this Master Agreement shall be due and payable in accordance with each Party’s invoice instructions on or before the later of the twentieth (20th) day of each month, or tenth (10th) day after receipt of the invoice or, if such day is not a Business Day, then on the next Business Day. Each Party will make payments by electronic funds transfer, or by other mutually agreeable method(s), to the account designated by the other Party. Any amounts not paid by the due date will be deemed delinquent and will accrue interest at the Interest Rate, such interest to be calculated from and including the due date to but excluding the date the delinquent amount is paid in full.

6.3 Disputes and Adjustments of Invoices. A Party may, in good faith, dispute the correctness of any invoice or any adjustment to an invoice, rendered under this Agreement or adjust any invoice for any arithmetic or computational error within twelve (12) months of the date the invoice, or adjustment to an invoice, was rendered. In the event an invoice or portion thereof, or any other claim or adjustment arising hereunder, is disputed, payment of the undisputed portion of the invoice shall be required to be made when due, with notice of the objection given to the other Party. Any invoice dispute or invoice adjustment shall be in writing and shall state the basis for the dispute or adjustment. Payment of the disputed amount shall not be required until the dispute is resolved. Upon resolution of the dispute, any required payment shall be made within two (2) Business Days of such resolution along with interest accrued at the Interest Rate from and including the due date to but excluding the date paid. Inadvertent overpayments shall be returned upon request or deducted by the Party receiving such overpayment from subsequent payments, with interest accrued at the Interest Rate from and including the date of such overpayment to but excluding the date repaid or deducted by the Party receiving such overpayment. Any dispute with respect to an invoice is waived unless the other Party is notified in accordance with this Section 6.3 within twelve (12) months after the invoice is rendered or any specific adjustment to the invoice is made. If an invoice is not rendered within twelve (12) months after the close of the month during which performance of a Transaction occurred, the right to payment for such performance is waived.

6.4 Netting of Payments. The Parties hereby agree that they shall discharge mutual debts and payment obligations due and owing to each other on the same date pursuant to all Transactions through netting, in which case all amounts owed by each Party to the other Party for the purchase and sale of Products during the monthly billing period under this Master Agreement, including any related damages calculated pursuant to Article Four (unless one of the Parties elects to accelerate payment of such amounts as permitted by Article Four), interest, and payments or credits, shall be netted so that only the excess amount remaining due shall be paid by the Party who owes it.

6.5 Payment Obligation Absent Netting. If no mutual debts or payment obligations exist and only one Party owes a debt or obligation to the other during the monthly billing period, including, but not limited to, any related damage amounts calculated pursuant to Article Four, interest, and payments or credits, that Party shall pay such sum in full when due. ..

Item 10 Page 23 of 64
18 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

6.6 Security. Unless the Party benefiting from Performance Assurance or a guaranty notifies the other Party in writing, and except in connection with a liquidation and termination in accordance with Article Five, all amounts netted pursuant to this Article Six shall not take into account or include any Performance Assurance or guaranty which may be in effect to secure a Party’s performance under this Agreement.

6.7 Payment for Options. The premium amount for the purchase of an Option shall be paid within two (2) Business Days of receipt of an invoice from the Option Seller. Upon exercise of an Option, payment for the Product underlying such Option shall be due in accordance with Section 6.1.

6.8 Transaction Netting. If the Parties enter into one or more Transactions, which in conjunction with one or more other outstanding Transactions, constitute Offsetting Transactions, then all such Offsetting Transactions may by agreement of the Parties, be netted into a single Transaction under which:
(a) the Party obligated to deliver the greater amount of Energy will deliver the difference between the total amount it is obligated to deliver and the total amount to be delivered to it under the Offsetting Transactions, and (b) the Party owing the greater aggregate payment will pay the net difference owed between the Parties.

Each single Transaction resulting under this Section shall be deemed part of the single, indivisible contractual arrangement between the parties, and once such resulting Transaction occurs, outstanding obligations under the Offsetting Transactions which are satisfied by such offset shall terminate.

ARTICLE SEVEN: LIMITATIONS

7.1 Limitation of Remedies, Liability and Damages. EXCEPT AS SET FORTH

HEREIN, THERE IS NO WARRANTY OF MERCHANTABILITY OR FITNESS FOR A

PARTICULAR PURPOSE, AND ANY AND ALL IMPLIED WARRANTIES ARE DISCLAIMED. THE PARTIES CONFIRM THAT THE EXPRESS REMEDIES AND

MEASURES OF DAMAGES PROVIDED IN THIS AGREEMENT SATISFY THE ESSENTIAL PURPOSES HEREOF. FOR BREACH OF ANY PROVISION FOR WHICH AN

EXPRESS REMEDY OR MEASURE OF DAMAGES IS PROVIDED, SUCH EXPRESS

REMEDY OR MEASURE OF DAMAGES SHALL BE THE SOLE AND EXCLUSIVE REMEDY, THE OBLIGOR’S LIABILITY SHALL BE LIMITED AS SET FORTH IN SUCH

PROVISION AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. IF NO REMEDY OR MEASURE OF DAMAGES IS EXPRESSLY PROVIDED HEREIN OR IN A TRANSACTION, THE OBLIGOR’S LIABILITY SHALL BE LIMITED

TO DIRECT ACTUAL DAMAGES ONLY, SUCH DIRECT ACTUAL DAMAGES SHALL

BE THE SOLE AND EXCLUSIVE REMEDY AND ALL OTHER REMEDIES OR DAMAGES AT LAW OR IN EQUITY ARE WAIVED. UNLESS EXPRESSLY HEREIN

PROVIDED, NEITHER PARTY SHALL BE LIABLE FOR CONSEQUENTIAL, INCIDENTAL, PUNITIVE, EXEMPLARY OR INDIRECT DAMAGES, LOST PROFITS OR ..

Item 10 Page 24 of 64
19 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

OTHER BUSINESS INTERRUPTION DAMAGES, BY STATUTE, IN TORT OR CONTRACT, UNDER ANY INDEMNITY PROVISION OR OTHERWISE. IT IS THE

INTENT OF THE PARTIES THAT THE LIMITATIONS HEREIN IMPOSED ON REMEDIES

AND THE MEASURE OF DAMAGES BE WITHOUT REGARD TO THE CAUSE OR

CAUSES RELATED THERETO, INCLUDING THE NEGLIGENCE OF ANY PARTY,

WHETHER SUCH NEGLIGENCE BE SOLE, JOINT OR CONCURRENT, OR ACTIVE OR PASSIVE. TO THE EXTENT ANY DAMAGES REQUIRED TO BE PAID HEREUNDER

ARE LIQUIDATED, THE PARTIES ACKNOWLEDGE THAT THE DAMAGES ARE

DIFFICULT OR IMPOSSIBLE TO DETERMINE, OR OTHERWISE OBTAINING AN

ADEQUATE REMEDY IS INCONVENIENT AND THE DAMAGES CALCULATED

HEREUNDER CONSTITUTE A REASONABLE APPROXIMATION OF THE HARM OR LOSS.

ARTICLE EIGHT: CREDIT AND COLLATERAL REQUIREMENTS

8.1 Party A Credit Protection. The applicable credit and collateral requirements shall be as specified on the Cover Sheet. If no option in Section 8.1(a) is specified on the Cover Sheet, Section 8.l(a) Option C shall apply exclusively. If none of Sections 8.1(b), 8.1(c) or

8.1(d) are specified on the Cover Sheet, Section 8.1(b) shall apply exclusively. (a) Financial Information. Option A: If requested by Party A, Party B shall deliver (i) within 120 days following the end of each fiscal year, a copy of Party B’s annual report containing audited consolidated financial statements for such fiscal year and (ii) within 60 days after the end of each of its first three fiscal quarters of each fiscal year, a copy of Party B’s quarterly report containing unaudited consolidated financial statements for such fiscal quarter.

In all cases the statements shall be for the most recent accounting period and prepared in accordance with generally accepted accounting principles; provided, however, that should any such statements not be available on a timely basis due to a delay in preparation or certification, such delay shall not be an Event of Default so long as Party B diligently pursues the preparation, certification and delivery of the statements.

Option B: If requested by Party A, Party B shall deliver (i) within 120 days following the end of each fiscal year, a copy of the annual report containing audited consolidated financial statements for such fiscal year for the party(s) specified on the Cover Sheet and (ii) within 60 days after the end of each of its first three fiscal quarters of each fiscal year, a copy of quarterly report containing unaudited consolidated financial statements for such fiscal quarter for the party(s) specified on the Cover Sheet. In all cases the statements shall be for the most recent accounting period and shall be prepared in accordance with generally accepted accounting principles; provided, however, that should any such statements not be available on a timely basis due to a delay in preparation or certification, such delay shall not be an Event of Default so long as the relevant entity diligently pursues the preparation, certification and delivery of the statements.

Option C: Party A may request from Party B the information specified in the Cover Sheet. ..

Item 10 Page 25 of 64
20 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association (b) Credit Assurances. If Party A has reasonable grounds to believe that Party B’s creditworthiness or performance under this Agreement has become unsatisfactory, Party A will provide Party B with written notice requesting Performance Assurance in an amount determined by Party A in a commercially reasonable manner. Upon receipt of such notice Party B shall have three (3) Business Days to remedy the situation by providing such Performance Assurance to Party A. In the event that Party B fails to provide such Performance Assurance, or a guaranty or other credit assurance acceptable to Party A within three (3) Business Days of receipt of notice, then an Event of Default under Article Five will be deemed to have occurred and Party A will be entitled to the remedies set forth in Article Five of this Master Agreement. (c) Collateral Threshold. If at any time and from time to time during the term of this Agreement (and notwithstanding whether an Event of Default has occurred), the Termination Payment that would be owed to Party A plus Party B’s Independent Amount, if any, exceeds the Party B Collateral Threshold, then Party A, on any Business Day, may request that Party B provide Performance Assurance in an amount equal to the amount by which the Termination Payment plus Party B’s Independent Amount, if any, exceeds the Party B Collateral Threshold (rounding upwards for any fractional amount to the next Party B Rounding Amount) (“Party B Performance Assurance”), less any Party B Performance Assurance already posted with Party A. Such Party B Performance Assurance shall be delivered to Party A within three (3) Business Days of the date of such request. On any Business Day (but no more frequently than weekly with respect to Letters of Credit and daily with respect to cash), Party B, at its sole cost, may request that such Party B Performance Assurance be reduced correspondingly to the amount of such excess Termination Payment plus Party B’s Independent Amount, if any, (rounding upwards for any fractional amount to the next Party B Rounding Amount). In the event that Party B fails to provide Party B Performance Assurance pursuant to the terms of this Article Eight within three (3) Business Days, then an Event of Default under Article Five shall be deemed to have occurred and Party A will be entitled to the remedies set forth in Article Five of this Master Agreement.

For purposes of this Section 8.1(c), the calculation of the Termination Payment shall be calculated pursuant to Section 5.3 by Party A as if all outstanding Transactions had been liquidated, and in addition thereto, shall include all amounts owed but not yet paid by Party B to Party A, whether or not such amounts are due, for performance already provided pursuant to any and all Transactions.
(d) Downgrade Event. If at any time there shall occur a Downgrade Event in respect of Party B, then Party A may require Party B to provide Performance Assurance in an amount determined by Party A in a commercially reasonable manner. In the event Party B shall fail to provide such Performance Assurance or a guaranty or other credit assurance acceptable to Party A within three (3) Business Days of receipt of notice, then an Event of Default shall be deemed to have occurred and Party A will be entitled to the remedies set forth in Article Five of this Master Agreement.
(e) If specified on the Cover Sheet, Party B shall deliver to Party A, prior to or concurrently with the execution and delivery of this Master Agreement a guarantee in an amount not less than the Guarantee Amount specified on the Cover Sheet and in a form reasonably acceptable to Party A. ..

Item 10 Page 26 of 64
21 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

8.2 Party B Credit Protection. The applicable credit and collateral requirements shall be as specified on the Cover Sheet. If no option in Section 8.2(a) is specified on the Cover Sheet, Section 8.2(a) Option C shall apply exclusively. If none of Sections 8.2(b), 8.2(c) or

8.2(d) are specified on the Cover Sheet, Section 8.2(b) shall apply exclusively. (a) Financial Information. Option A: If requested by Party B, Party A shall deliver (i) within 120 days following the end of each fiscal year, a copy of Party A’s annual report containing audited consolidated financial statements for such fiscal year and (ii) within 60 days after the end of each of its first three fiscal quarters of each fiscal year, a copy of such Party’s quarterly report containing unaudited consolidated financial statements for such fiscal quarter. In all cases the statements shall be for the most recent accounting period and prepared in accordance with generally accepted accounting principles; provided, however, that should any such statements not be available on a timely basis due to a delay in preparation or certification, such delay shall not be an Event of Default so long as such Party diligently pursues the preparation, certification and delivery of the statements.

Option B: If requested by Party B, Party A shall deliver (i) within 120 days following the end of each fiscal year, a copy of the annual report containing audited consolidated financial statements for such fiscal year for the party(s) specified on the Cover Sheet and (ii) within 60 days after the end of each of its first three fiscal quarters of each fiscal year, a copy of quarterly report containing unaudited consolidated financial statements for such fiscal quarter for the party(s) specified on the Cover Sheet. In all cases the statements shall be for the most recent accounting period and shall be prepared in accordance with generally accepted accounting principles; provided, however, that should any such statements not be available on a timely basis due to a delay in preparation or certification, such delay shall not be an Event of Default so long as the relevant entity diligently pursues the preparation, certification and delivery of the statements.

Option C: Party B may request from Party A the information specified in the Cover Sheet.
(b) Credit Assurances. If Party B has reasonable grounds to believe that Party A’s creditworthiness or performance under this Agreement has become unsatisfactory, Party B will provide Party A with written notice requesting Performance Assurance in an amount determined by Party B in a commercially reasonable manner. Upon receipt of such notice Party A shall have three (3) Business Days to remedy the situation by providing such Performance Assurance to Party B. In the event that Party A fails to provide such Performance Assurance, or a guaranty or other credit assurance acceptable to Party B within three (3) Business Days of receipt of notice, then an Event of Default under Article Five will be deemed to have occurred and Party B will be entitled to the remedies set forth in Article Five of this Master Agreement. (c) Collateral Threshold. If at any time and from time to time during the term of this Agreement (and notwithstanding whether an Event of Default has occurred), the Termination Payment that would be owed to Party B plus Party A’s Independent Amount, if any, exceeds the Party A Collateral Threshold, then Party B, on any Business Day, may request that Party A provide Performance Assurance in an amount equal to the amount by which the Termination Payment plus Party A’s Independent Amount, if any, exceeds the Party A Collateral ..

Item 10 Page 27 of 64
22 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association Threshold (rounding upwards for any fractional amount to the next Party A Rounding Amount) (“Party A Performance Assurance”), less any Party A Performance Assurance already posted with Party B. Such Party A Performance Assurance shall be delivered to Party B within three (3) Business Days of the date of such request. On any Business Day (but no more frequently than weekly with respect to Letters of Credit and daily with respect to cash), Party A, at its sole cost, may request that such Party A Performance Assurance be reduced correspondingly to the amount of such excess Termination Payment plus Party A’s Independent Amount, if any, (rounding upwards for any fractional amount to the next Party A Rounding Amount). In the event that Party A fails to provide Party A Performance Assurance pursuant to the terms of this Article Eight within three (3) Business Days, then an Event of Default under Article Five shall be deemed to have occurred and Party B will be entitled to the remedies set forth in Article Five of this Master Agreement.

For purposes of this Section 8.2(c), the calculation of the Termination Payment shall be calculated pursuant to Section 5.3 by Party B as if all outstanding Transactions had been liquidated, and in addition thereto, shall include all amounts owed but not yet paid by Party A to Party B, whether or not such amounts are due, for performance already provided pursuant to any and all Transactions.
(d) Downgrade Event. If at any time there shall occur a Downgrade Event in respect of Party A, then Party B may require Party A to provide Performance Assurance in an amount determined by Party B in a commercially reasonable manner. In the event Party A shall fail to provide such Performance Assurance or a guaranty or other credit assurance acceptable to Party B within three (3) Business Days of receipt of notice, then an Event of Default shall be deemed to have occurred and Party B will be entitled to the remedies set forth in Article Five of this Master Agreement.
(e) If specified on the Cover Sheet, Party A shall deliver to Party B, prior to or concurrently with the execution and delivery of this Master Agreement a guarantee in an amount not less than the Guarantee Amount specified on the Cover Sheet and in a form reasonably acceptable to Party B.

8.3 Grant of Security Interest/Remedies. To secure its obligations under this Agreement and to the extent either or both Parties deliver Performance Assurance hereunder, each Party (a “Pledgor”) hereby grants to the other Party (the “Secured Party”) a present and continuing security interest in, and lien on (and right of setoff against), and assignment of, all cash collateral and cash equivalent collateral and any and all proceeds resulting therefrom or the liquidation thereof, whether now or hereafter held by, on behalf of, or for the benefit of, such Secured Party, and each Party agrees to take such action as the other Party reasonably requires in order to perfect the Secured Party’s first-priority security interest in, and lien on (and right of setoff against), such collateral and any and all proceeds resulting therefrom or from the liquidation thereof. Upon or any time after the occurrence or deemed occurrence and during the continuation of an Event of Default or an Early Termination Date, the Non-Defaulting Party may do any one or more of the following: (i) exercise any of the rights and remedies of a Secured Party with respect to all Performance Assurance, including any such rights and remedies under law then in effect; (ii) exercise its rights of setoff against any and all property of the Defaulting Party in the possession of the Non-Defaulting Party or its agent; (iii) draw on any outstanding ..

Item 10 Page 28 of 64
23 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association Letter of Credit issued for its benefit; and (iv) liquidate all Performance Assurance then held by or for the benefit of the Secured Party free from any claim or right of any nature whatsoever of the Defaulting Party, including any equity or right of purchase or redemption by the Defaulting Party. The Secured Party shall apply the proceeds of the collateral realized upon the exercise of any such rights or remedies to reduce the Pledgor’s obligations under the Agreement (the Pledgor remaining liable for any amounts owing to the Secured Party after such application), subject to the Secured Party’s obligation to return any surplus proceeds remaining after such obligations are satisfied in full.

ARTICLE NINE: GOVERNMENTAL CHARGES

9.1 Cooperation. Each Party shall use reasonable efforts to implement the provisions of and to administer this Master Agreement in accordance with the intent of the parties to minimize all taxes , so long as neither Party is materially adversely affected by such efforts.

9.2 Governmental Charges. Seller shall pay or cause to be paid all taxes imposed by any government authority(“Governmental Charges”) on or with respect to the Product or a Transaction arising prior to the Delivery Point. Buyer shall pay or cause to be paid all Governmental Charges on or with respect to the Product or a Transaction at and from the Delivery Point (other than ad valorem, franchise or income taxes which are related to the sale of the Product and are, therefore, the responsibility of the Seller). In the event Seller is required by law or regulation to remit or pay Governmental Charges which are Buyer’s responsibility hereunder, Buyer shall promptly reimburse Seller for such Governmental Charges. If Buyer is required by law or regulation to remit or pay Governmental Charges which are Seller’s responsibility hereunder, Buyer may deduct the amount of any such Governmental Charges from the sums due to Seller under Article 6 of this Agreement. Nothing shall obligate or cause a Party to pay or be liable to pay any Governmental Charges for which it is exempt under the law.

ARTICLE TEN: MISCELLANEOUS

10.1 Term of Master Agreement. The term of this Master Agreement shall commence on the Effective Date and shall remain in effect until terminated by either Party upon (thirty) 30 days’ prior written notice; provided, however, that such termination shall not affect or excuse the performance of either Party under any provision of this Master Agreement that by its terms survives any such termination and, provided further, that this Master Agreement and any other documents executed and delivered hereunder shall remain in effect with respect to the Transaction(s) entered into prior to the effective date of such termination until both Parties have fulfilled all of their obligations with respect to such Transaction(s), or such Transaction(s) that have been terminated under Section 5.2 of this Agreement.

10.2 Representations and Warranties. On the Effective Date and the date of entering into each Transaction, each Party represents and warrants to the other Party that:
(i) it is duly organized, validly existing and in good standing under the laws of the jurisdiction of its formation;
..

Item 10 Page 29 of 64
24 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association (ii) it has all regulatory authorizations necessary for it to legally perform its obligations under this Master Agreement and each Transaction (including any Confirmation accepted in accordance with Section 2.3); (iii) the execution, delivery and performance of this Master Agreement and each Transaction (including any Confirmation accepted in accordance with Section 2.3) are within its powers, have been duly authorized by all necessary action and do not violate any of the terms and conditions in its governing documents, any contracts to which it is a party or any law, rule, regulation, order or the like applicable to it;
(iv) this Master Agreement, each Transaction (including any Confirmation accepted in accordance with Section 2.3), and each other document executed and delivered in accordance with this Master Agreement constitutes its legally valid and binding obligation enforceable against it in accordance with its terms; subject to any Equitable Defenses. (v) it is not Bankrupt and there are no proceedings pending or being contemplated by it or, to its knowledge, threatened against it which would result in it being or becoming Bankrupt;
(vi) there is not pending or, to its knowledge, threatened against it or any of its Affiliates any legal proceedings that could materially adversely affect its ability to perform its obligations under this Master Agreement and each Transaction (including any Confirmation accepted in accordance with Section 2.3);
(vii) no Event of Default or Potential Event of Default with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Master Agreement and each Transaction (including any Confirmation accepted in accordance with Section 2.3);
(viii) it is acting for its own account, has made its own independent decision to enter into this Master Agreement and each Transaction (including any Confirmation accepted in accordance with Section 2.3) and as to whether this Master Agreement and each such Transaction (including any Confirmation accepted in accordance with Section 2.3) is appropriate or proper for it based upon its own judgment, is not relying upon the advice or recommendations of the other Party in so doing, and is capable of assessing the merits of and understanding, and understands and accepts, the terms, conditions and risks of this Master Agreement and each Transaction (including any Confirmation accepted in accordance with Section 2.3);
(ix) it is a “forward contract merchant” within the meaning of the United States Bankruptcy Code;
..

Item 10 Page 30 of 64
25 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association (x) it has entered into this Master Agreement and each Transaction (including any Confirmation accepted in accordance with Section 2.3) in connection with the conduct of its business and it has the capacity or ability to make or take delivery of all Products referred to in the Transaction to which it is a Party;
(xi) with respect to each Transaction (including any Confirmation accepted in accordance with Section 2.3) involving the purchase or sale of a Product or an Option, it is a producer, processor, commercial user or merchant handling the Product, and it is entering into such Transaction for purposes related to its business as such; and
(xii) the material economic terms of each Transaction are subject to individual negotiation by the Parties.

10.3 Title and Risk of Loss. Title to and risk of loss related to the Product shall transfer from Seller to Buyer at the Delivery Point. Seller warrants that it will deliver to Buyer the Quantity of the Product free and clear of all liens, security interests, claims and encumbrances or any interest therein or thereto by any person arising prior to the Delivery Point.

10.4 Indemnity. Each Party shall indemnify, defend and hold harmless the other Party from and against any Claims arising from or out of any event, circumstance, act or incident first occurring or existing during the period when control and title to Product is vested in such Party as provided in Section 10.3. Each Party shall indemnify, defend and hold harmless the other Party against any Governmental Charges for which such Party is responsible under Article Nine.

10.5 Assignment. Neither Party shall assign this Agreement or its rights hereunder without the prior written consent of the other Party, which consent may be withheld in the exercise of its sole discretion; provided, however, either Party may, without the consent of the other Party (and without relieving itself from liability hereunder), (i) transfer, sell, pledge, encumber or assign this Agreement or the accounts, revenues or proceeds hereof in connection with any financing or other financial arrangements, (ii) transfer or assign this Agreement to an affiliate of such Party which affiliate’s creditworthiness is equal to or higher than that of such Party, or (iii) transfer or assign this Agreement to any person or entity succeeding to all or substantially all of the assets whose creditworthiness is equal to or higher than that of such Party; provided, however, that in each such case, any such assignee shall agree in writing to be bound by the terms and conditions hereof and so long as the transferring Party delivers such tax and enforceability assurance as the non-transferring Party may reasonably request.

10.6 Governing Law. THIS AGREEMENT AND THE RIGHTS AND DUTIES OF

THE PARTIES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED,

ENFORCED AND PERFORMED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH

PARTY WAIVES ITS RESPECTIVE RIGHT TO ANY JURY TRIAL WITH RESPECT TO ANY LITIGATION ARISING UNDER OR IN CONNECTION WITH THIS AGREEMENT. ..

Item 10 Page 31 of 64
26 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

10.7 Notices. All notices, requests, statements or payments shall be made as specified in the Cover Sheet. Notices (other than scheduling requests) shall, unless otherwise specified herein, be in writing and may be delivered by hand delivery, United States mail, overnight courier service or facsimile. Notice by facsimile or hand delivery shall be effective at the close of business on the day actually received, if received during business hours on a Business Day, and otherwise shall be effective at the close of business on the next Business Day. Notice by overnight United States mail or courier shall be effective on the next Business Day after it was sent. A Party may change its addresses by providing notice of same in accordance herewith.

10.8 General. This Master Agreement (including the exhibits, schedules and any written supplements hereto), the Party A Tariff, if any, the Party B Tariff, if any, any designated collateral, credit support or margin agreement or similar arrangement between the Parties and all Transactions (including any Confirmation accepted in accordance with Section 2.3) constitute the entire agreement between the Parties relating to the subject matter. Notwithstanding the foregoing, any collateral, credit support or margin agreement or similar arrangement between the Parties shall, upon designation by the Parties, be deemed part of this Agreement and shall be incorporated herein by reference. This Agreement shall be considered for all purposes as prepared through the joint efforts of the parties and shall not be construed against one party or the other as a result of the preparation, substitution, submission or other event of negotiation, drafting or execution hereof. Except to the extent herein provided for, no amendment or modification to this Master Agreement shall be enforceable unless reduced to writing and executed by both Parties. Each Party agrees if it seeks to amend any applicable wholesale power sales tariff during the term of this Agreement, such amendment will not in any way affect outstanding Transactions under this Agreement without the prior written consent of the other Party. Each Party further agrees that it will not assert, or defend itself, on the basis that any applicable tariff is inconsistent with this Agreement. This Agreement shall not impart any rights enforceable by any third party (other than a permitted successor or assignee bound to this Agreement). Waiver by a Party of any default by the other Party shall not be construed as a waiver of any other default. Any provision declared or rendered unlawful by any applicable court of law or regulatory agency or deemed unlawful because of a statutory change (individually or collectively, such events referred to as “Regulatory Event”) will not otherwise affect the remaining lawful obligations that arise under this Agreement; and provided, further, that if a Regulatory Event occurs, the Parties shall use their best efforts to reform this Agreement in order to give effect to the original intention of the Parties. The term “including” when used in this Agreement shall be by way of example only and shall not be considered in any way to be in limitation. The headings used herein are for convenience and reference purposes only. All indemnity and audit rights shall survive the termination of this Agreement for twelve (12) months. This Agreement shall be binding on each Party’s successors and permitted assigns.

10.9 Audit. Each Party has the right, at its sole expense and during normal working hours, to examine the records of the other Party to the extent reasonably necessary to verify the accuracy of any statement, charge or computation made pursuant to this Master Agreement. If requested, a Party shall provide to the other Party statements evidencing the Quantity delivered at the Delivery Point. If any such examination reveals any inaccuracy in any statement, the necessary adjustments in such statement and the payments thereof will be made promptly and shall bear interest calculated at the Interest Rate from the date the overpayment or underpayment was made until paid; provided, however, that no adjustment for any statement or payment will be ..

Item 10 Page 32 of 64
27 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association made unless objection to the accuracy thereof was made prior to the lapse of twelve (12) months from the rendition thereof, and thereafter any objection shall be deemed waived.

10.10 Forward Contract. The Parties acknowledge and agree that all Transactions constitute “forward contracts” within the meaning of the United States Bankruptcy Code.

10.11 Confidentiality. If the Parties have elected on the Cover Sheet to make this Section 10.11 applicable to this Master Agreement, neither Party shall disclose the terms or conditions of a Transaction under this Master Agreement to a third party (other than the Party’s employees, lenders, counsel, accountants or advisors who have a need to know such information and have agreed to keep such terms confidential) except in order to comply with any applicable law, regulation, or any exchange, control area or independent system operator rule or in connection with any court or regulatory proceeding; provided, however, each Party shall, to the extent practicable, use reasonable efforts to prevent or limit the disclosure. The Parties shall be entitled to all remedies available at law or in equity to enforce, or seek relief in connection with, this confidentiality obligation. ..

Item 10 Page 33 of 64
28 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

SCHEDULE M
(THIS SCHEDULE IS INCLUDED IF THE APPROPRIATE BOX ON THE COVER

SHEET IS MARKED INDICATING A PARTY IS A GOVERNMENTAL ENTITY OR

PUBLIC POWER SYSTEM)
A. The Parties agree to add the following definitions in Article One. “Act” means ______________________________.
1 “Governmental Entity or Public Power System” means a
municipality, county, governmental board, public power authority, public utility district, joint action agency, or other similar political subdivision or public entity of the United States, one or more States or territories or any combination thereof.
“Special Fund” means a fund or account of the Governmental Entity or Public Power System set aside and or pledged to satisfy the Public Power System’s obligations hereunder out of which amounts shall be paid to satisfy all of the Public Power System’s obligations under this Master Agreement for the entire Delivery Period.

B. The following sentence shall be added to the end of the definition of “Force Majeure” in Article One.

If the Claiming Party is a Governmental Entity or Public Power System, Force Majeure does not include any action taken by the Governmental Entity or Public Power System in its governmental capacity.

C. The Parties agree to add the following representations and warranties to Section 10.2:

Further and with respect to a Party that is a Governmental Entity or Public Power System, such Governmental Entity or Public Power System represents and warrants to the other Party continuing throughout the term of this Master Agreement, with respect to this Master Agreement and each Transaction, as follows: (i) all acts necessary to the valid execution, delivery and performance of this Master Agreement, including without limitation, competitive bidding, public notice, election, referendum, prior appropriation or other required procedures has or will be taken and performed as required under the Act and the Public Power System’s ordinances, bylaws or other regulations, (ii) all persons making up the governing body of Governmental Entity or Public Power System are the duly elected or appointed incumbents in their positions and hold such 1 Cite the state enabling and other relevant statutes applicable to Governmental Entity or Public Power System. ..

Item 10 Page 34 of 64
29 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association positions in good standing in accordance with the Act and other applicable law, (iii) entry into and performance of this Master Agreement by Governmental Entity or Public Power System are for a proper public purpose within the meaning of the Act and all other relevant constitutional, organic or other governing documents and applicable law, (iv) the term of this Master Agreement does not extend beyond any applicable limitation imposed by the Act or other relevant constitutional, organic or other governing documents and applicable law, (v) the Public Power System’s obligations to make payments hereunder are unsubordinated obligations and such payments are (a) operating and maintenance costs (or similar designation) which enjoy first priority of payment at all times under any and all bond ordinances or indentures to which it is a party, the Act and all other relevant constitutional, organic or other governing documents and applicable law or (b) otherwise not subject to any prior claim under any and all bond ordinances or indentures to which it is a party, the Act and all other relevant constitutional, organic or other governing documents and applicable law and are available without limitation or deduction to satisfy all Governmental Entity or Public Power System’ obligations hereunder and under each Transaction or (c) are to be made solely from a Special Fund, (vi) entry into and performance of this Master Agreement and each Transaction by the Governmental Entity or Public Power System will not adversely affect the exclusion from gross income for federal income tax purposes of interest on any obligation of Governmental Entity or Public Power System otherwise entitled to such exclusion, and (vii) obligations to make payments hereunder do not constitute any kind of indebtedness of Governmental Entity or Public Power System or create any kind of lien on, or security interest in, any property or revenues of Governmental Entity or Public Power System which, in either case, is proscribed by any provision of the Act or any other relevant constitutional, organic or other governing documents and applicable law, any order or judgment of any court or other agency of government applicable to it or its assets, or any contractual restriction binding on or affecting it or any of its assets.

D. The Parties agree to add the following sections to Article Three:

Section 3.4 Public Power System’s Deliveries. On the Effective Date and as a condition to the obligations of the other Party under this Agreement, Governmental Entity or Public Power System shall provide the other Party hereto (i) certified copies of all ordinances, resolutions, public notices and other documents evidencing the necessary authorizations with respect to the execution, delivery and performance by Governmental Entity or Public Power System of this Master Agreement and (ii) an opinion of counsel for Governmental Entity or Public Power System, in form and substance reasonably satisfactory to the Other Party, regarding the validity, binding effect and enforceability of this Master Agreement against Governmental Entity or Public Power System in ..

Item 10 Page 35 of 64
30 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association respect of the Act and all other relevant constitutional organic or other governing documents and applicable law.

Section 3.5 No Immunity Claim. Governmental Entity or Public Power System warrants and covenants that with respect to its contractual obligations hereunder and performance thereof, it will not claim immunity on the grounds of sovereignty or similar grounds with respect to itself or its revenues or assets from (a) suit, (b) jurisdiction of court (including a court located outside the jurisdiction of its organization), (c) relief by way of injunction, order for specific performance or recovery of property, (d) attachment of assets, or (e) execution or enforcement of any judgment.

E. If the appropriate box is checked on the Cover Sheet, as an alternative to selecting one of the options under Section 8.3, the Parties agree to add the following section to Article Three:

Section 3.6 Governmental Entity or Public Power System
Security. With respect to each Transaction, Governmental Entity or Public Power System shall either (i) have created and set aside a Special Fund or (ii) upon execution of this Master Agreement and prior to the commencement of each subsequent fiscal year of Governmental Entity or Public Power System during any Delivery Period, have obtained all necessary budgetary approvals and certifications for payment of all of its obligations under this Master Agreement for such fiscal year; any breach of this provision shall be deemed to have arisen during a fiscal period of Governmental Entity or Public Power System for which budgetary approval or certification of its obligations under this Master Agreement is in effect and, notwithstanding anything to the contrary in Article Four, an Early Termination Date shall automatically and without further notice occur hereunder as of such date wherein Governmental Entity or Public Power System shall be treated as the Defaulting Party. Governmental Entity or Public Power System shall have allocated to the Special Fund or its general funds a revenue base that is adequate to cover Public Power System’s payment obligations hereunder throughout the entire Delivery Period.

F. If the appropriate box is checked on the Cover Sheet, the Parties agree to add the following section to Article Eight:

Section 8.4 Governmental Security. As security for payment and performance of Public Power System’s obligations hereunder, Public Power System hereby pledges, sets over, assigns and grants to the other Party a security interest in all of Public Power System’s right, title and interest in and to [specify collateral].
..

Item 10 Page 36 of 64
31 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association G. The Parties agree to add the following sentence at the end of Section 10.6 - Governing Law:

NOTWITHSTANDING THE FOREGOING, IN RESPECT OF THE

APPLICABILITY OF THE ACT AS HEREIN PROVIDED, THE LAWS
OF THE STATE OF _____________
2 SHALL APPLY.
2 Insert relevant state for Governmental Entity or Public Power System. ..

Item 10 Page 37 of 64
32 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association SCHEDULE P: PRODUCTS AND RELATED DEFINITIONS
“Ancillary Services” means any of the services identified by a Transmission Provider in its transmission tariff as “ancillary services” including, but not limited to, regulation and frequency response, energy imbalance, operating reserve-spinning and operating reserve- supplemental, as may be specified in the Transaction.
“Capacity” has the meaning specified in the Transaction. “Energy” means three-phase, 60-cycle alternating current electric energy, expressed in megawatt hours.
“Firm (LD)” means, with respect to a Transaction, that either Party shall be relieved of its obligations to sell and deliver or purchase and receive without liability only to the extent that, and for the period during which, such performance is prevented by Force Majeure. In the absence of Force Majeure, the Party to which performance is owed shall be entitled to receive from the Party which failed to deliver/receive an amount determined pursuant to Article Four. “Firm Transmission Contingent - Contract Path” means, with respect to a Transaction, that the performance of either Seller or Buyer (as specified in the Transaction) shall be excused, and no damages shall be payable including any amounts determined pursuant to Article Four, if the transmission for such Transaction is interrupted or curtailed and (i) such Party has provided for firm transmission with the transmission provider(s) for the Product in the case of the Seller from the generation source to the Delivery Point or in the case of the Buyer from the Delivery Point to the ultimate sink, and (ii) such interruption or curtailment is due to “force majeure” or “uncontrollable force” or a similar term as defined under the applicable transmission provider’s tariff. This contingency shall excuse performance for the duration of the interruption or curtailment notwithstanding the provisions of the definition of “Force Majeure” in Section 1.23 to the contrary.
“Firm Transmission Contingent - Delivery Point” means, with respect to a Transaction, that the performance of either Seller or Buyer (as specified in the Transaction) shall be excused, and no damages shall be payable including any amounts determined pursuant to Article Four, if the transmission to the Delivery Point (in the case of Seller) or from the Delivery Point (in the case of Buyer) for such Transaction is interrupted or curtailed and (i) such Party has provided for firm transmission with the transmission provider(s) for the Product, in the case of the Seller, to be delivered to the Delivery Point or, in the case of Buyer, to be received at the Delivery Point and (ii) such interruption or curtailment is due to “force majeure” or “uncontrollable force” or a similar term as defined under the applicable transmission provider’s tariff. This transmission contingency excuses performance for the duration of the interruption or curtailment, notwithstanding the provisions of the definition of “Force Majeure” in Section 1.23 to the contrary. Interruptions or curtailments of transmission other than the transmission either immediately to or from the Delivery Point shall not excuse performance “Firm (No Force Majeure)” means, with respect to a Transaction, that if either Party fails to perform its obligation to sell and deliver or purchase and receive the Product, the Party to which performance is owed shall be entitled to receive from the Party which failed to perform an ..

Item 10 Page 38 of 64
33 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association amount determined pursuant to Article Four. Force Majeure shall not excuse performance of a Firm (No Force Majeure) Transaction.
“Into ______________ (the “Receiving Transmission Provider”), Seller’s Daily Choice” means that, in accordance with the provisions set forth below, (1) the Product shall be scheduled and delivered to an interconnection or interface (“Interface”) either (a) on the Receiving Transmission Provider’s transmission system border or (b) within the control area of the Receiving Transmission Provider if the Product is from a source of generation in that control area, which Interface, in either case, the Receiving Transmission Provider identifies as available for delivery of the Product in or into its control area; and (2) Seller has the right on a daily prescheduled basis to designate the Interface where the Product shall be delivered. An “Into” Product shall be subject to the following provisions:

1. Prescheduling and Notification. Subject to the provisions of Section 6, not later than the prescheduling deadline of 11:00 a.m. CPT on the Business Day before the next delivery day or as otherwise agreed to by Buyer and Seller, Seller shall notify Buyer (“Seller’s Notification”) of Seller’s immediate upstream counterparty and the Interface (the “Designated Interface”) where Seller shall deliver the Product for the next delivery day, and Buyer shall notify Seller of Buyer’s immediate downstream counterparty.

2. Availability of “Firm Transmission” to Buyer at Designated Interface; “Timely Request for Transmission,” “ADI” and “Available Transmission.” In determining availability to Buyer of next-day firm transmission (“Firm Transmission”) from the Designated Interface, a “Timely Request for Transmission” shall mean a properly completed request for Firm Transmission made by Buyer in accordance with the controlling tariff procedures, which request shall be submitted to the Receiving Transmission Provider no later than 30 minutes after delivery of Seller’s Notification, provided, however, if the Receiving Transmission Provider is not accepting requests for Firm Transmission at the time of Seller’s Notification, then such request by Buyer shall be made within 30 minutes of the time when the Receiving Transmission Provider first opens thereafter for purposes of accepting requests for Firm Transmission.

Pursuant to the terms hereof, delivery of the Product may under certain circumstances be redesignated to occur at an Interface other than the Designated Interface (any such alternate designated interface, an “ADI”) either (a) on the Receiving Transmission Provider’s transmission system border or (b) within the control area of the Receiving Transmission Provider if the Product is from a source of generation in that control area, which ADI, in either case, the Receiving Transmission Provider identifies as available for delivery of the Product in or into its control area using either firm or non-firm transmission, as available on a day-ahead or hourly basis (individually or collectively referred to as “Available Transmission”) within the Receiving Transmission Provider’s transmission system.

3. Rights of Buyer and Seller Depending Upon Availability of/Timely Request for Firm Transmission.

A. Timely Request for Firm Transmission made by Buyer, Accepted by the Receiving Transmission Provider and Purchased by Buyer. If a Timely Request for Firm Transmission is made by Buyer and is accepted by the Receiving Transmission Provider ..

Item 10 Page 39 of 64
34 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association and Buyer purchases such Firm Transmission, then Seller shall deliver and Buyer shall receive the Product at the Designated Interface.
i. If the Firm Transmission purchased by Buyer within the Receiving Transmission Provider’s transmission system from the Designated Interface ceases to be available to Buyer for any reason, or if Seller is unable to deliver the Product at the Designated Interface for any reason except Buyer’s non- performance, then at Seller’s choice from among the following, Seller shall: (a) to the extent Firm Transmission is available to Buyer from an ADI on a day-ahead basis, require Buyer to purchase such Firm Transmission from such ADI, and schedule and deliver the affected portion of the Product to such ADI on the basis of Buyer’s purchase of Firm Transmission, or (b) require Buyer to purchase non- firm transmission, and schedule and deliver the affected portion of the Product on the basis of Buyer’s purchase of non-firm transmission from the Designated Interface or an ADI designated by Seller, or (c) to the extent firm transmission is available on an hourly basis, require Buyer to purchase firm transmission, and schedule and deliver the affected portion of the Product on the basis of Buyer’s purchase of such hourly firm transmission from the Designated Interface or an ADI designated by Seller.
ii. If the Available Transmission utilized by Buyer as required by Seller pursuant to Section 3A(i) ceases to be available to Buyer for any reason, then Seller shall again have those alternatives stated in Section 3A(i) in order to satisfy its obligations.
iii. Seller’s obligation to schedule and deliver the Product at an ADI is subject to Buyer’s obligation referenced in Section 4B to cooperate reasonably therewith. If Buyer and Seller cannot complete the scheduling and/or delivery at an ADI, then Buyer shall be deemed to have satisfied its receipt obligations to Seller and Seller shall be deemed to have failed its delivery obligations to Buyer, and Seller shall be liable to Buyer for amounts determined pursuant to Article Four.
iv. In each instance in which Buyer and Seller must make alternative scheduling arrangements for delivery at the Designated Interface or an ADI pursuant to Sections 3A(i) or (ii), and Firm Transmission had been purchased by both Seller and Buyer into and within the Receiving Transmission Provider’s transmission system as to the scheduled delivery which could not be completed as a result of the interruption or curtailment of such Firm Transmission, Buyer and Seller shall bear their respective transmission expenses and/or associated congestion charges incurred in connection with efforts to complete delivery by such alternative scheduling and delivery arrangements. In any instance except as set forth in the immediately preceding sentence, Buyer and Seller must make alternative scheduling arrangements for delivery at the Designated Interface or an ADI under Sections 3A(i) or (ii), Seller shall be responsible for any additional transmission purchases and/or associated congestion charges incurred by Buyer in connection with such alternative scheduling arrangements. ..

Item 10 Page 40 of 64
35 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association B. Timely Request for Firm Transmission Made by Buyer but Rejected by the Receiving Transmission Provider. If Buyer’s Timely Request for Firm Transmission is rejected by the Receiving Transmission Provider because of unavailability of Firm Transmission from the Designated Interface, then Buyer shall notify Seller within 15 minutes after receipt of the Receiving Transmission Provider’s notice of rejection (“Buyer’s Rejection Notice”). If Buyer timely notifies Seller of such unavailability of Firm Transmission from the Designated Interface, then Seller shall be obligated either (1) to the extent Firm Transmission is available to Buyer from an ADI on a day-ahead basis, to require Buyer to purchase (at Buyer’s own expense) such Firm Transmission from such ADI and schedule and deliver the Product to such ADI on the basis of Buyer’s purchase of Firm Transmission, and thereafter the provisions in Section 3A shall apply, or (2) to require Buyer to purchase (at Buyer’s own expense) non-firm transmission, and schedule and deliver the Product on the basis of Buyer’s purchase of non-firm transmission from the Designated Interface or an ADI designated by the Seller, in which case Seller shall bear the risk of interruption or curtailment of the non-firm transmission; provided, however, that if the non-firm transmission is interrupted or curtailed or if Seller is unable to deliver the Product for any reason, Seller shall have the right to schedule and deliver the Product to another ADI in order to satisfy its delivery obligations, in which case Seller shall be responsible for any additional transmission purchases and/or associated congestion charges incurred by Buyer in connection with Seller’s inability to deliver the Product as originally prescheduled. If Buyer fails to timely notify Seller of the unavailability of Firm Transmission, then Buyer shall bear the risk of interruption or curtailment of transmission from the Designated Interface, and the provisions of Section 3D shall apply.

C. Timely Request for Firm Transmission Made by Buyer, Accepted by the Receiving Transmission Provider and not Purchased by Buyer. If Buyer’s Timely Request for Firm Transmission is accepted by the Receiving Transmission Provider but Buyer elects to purchase non-firm transmission rather than Firm Transmission to take delivery of the Product, then Buyer shall bear the risk of interruption or curtailment of transmission from the Designated Interface. In such circumstances, if Seller’s delivery is interrupted as a result of transmission relied upon by Buyer from the Designated Interface, then Seller shall be deemed to have satisfied its delivery obligations to Buyer, Buyer shall be deemed to have failed to receive the Product and Buyer shall be liable to Seller for amounts determined pursuant to Article Four.

D. No Timely Request for Firm Transmission Made by Buyer, or Buyer Fails to Timely Send Buyer’s Rejection Notice. If Buyer fails to make a Timely Request for Firm Transmission or Buyer fails to timely deliver Buyer’s Rejection Notice, then Buyer shall bear the risk of interruption or curtailment of transmission from the Designated Interface. In such circumstances, if Seller’s delivery is interrupted as a result of transmission relied upon by Buyer from the Designated Interface, then Seller shall be deemed to have satisfied its delivery obligations to Buyer, Buyer shall be deemed to have failed to receive the Product and Buyer shall be liable to Seller for amounts determined pursuant to Article Four.
..

Item 10 Page 41 of 64
36 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

4. Transmission.

A. Seller’s Responsibilities. Seller shall be responsible for transmission required to deliver the Product to the Designated Interface or ADI, as the case may be. It is expressly agreed that Seller is not required to utilize Firm Transmission for its delivery obligations hereunder, and Seller shall bear the risk of utilizing non-firm transmission. If Seller’s scheduled delivery to Buyer is interrupted as a result of Buyer’s attempted transmission of the Product beyond the Receiving Transmission Provider’s system border, then Seller will be deemed to have satisfied its delivery obligations to Buyer, Buyer shall be deemed to have failed to receive the Product and Buyer shall be liable to Seller for damages pursuant to Article Four.

B. Buyer’s Responsibilities. Buyer shall be responsible for transmission required to receive and transmit the Product at and from the Designated Interface or ADI, as the case may be, and except as specifically provided in Section 3A and 3B, shall be responsible for any costs associated with transmission therefrom. If Seller is attempting to complete the designation of an ADI as a result of Seller’s rights and obligations hereunder, Buyer shall co-operate reasonably with Seller in order to effect such alternate designation.

5. Force Majeure. An “Into” Product shall be subject to the “Force Majeure” provisions in Section 1.23.

6. Multiple Parties in Delivery Chain Involving a Designated Interface. Seller and Buyer recognize that there may be multiple parties involved in the delivery and receipt of the Product at the Designated Interface or ADI to the extent that (1) Seller may be purchasing the Product from a succession of other sellers (“Other Sellers”), the first of which Other Sellers shall be causing the Product to be generated from a source (“Source Seller”) and/or (2) Buyer may be selling the Product to a succession of other buyers (“Other Buyers”), the last of which Other Buyers shall be using the Product to serve its energy needs (“Sink Buyer”). Seller and Buyer further recognize that in certain Transactions neither Seller nor Buyer may originate the decision as to either (a) the original identification of the Designated Interface or ADI (which designation may be made by the Source Seller) or (b) the Timely Request for Firm Transmission or the purchase of other Available Transmission (which request may be made by the Sink Buyer).

Accordingly, Seller and Buyer agree as follows:

A. If Seller is not the Source Seller, then Seller shall notify Buyer of the Designated Interface promptly after Seller is notified thereof by the Other Seller with whom Seller has a contractual relationship, but in no event may such designation of the Designated Interface be later than the prescheduling deadline pertaining to the Transaction between Buyer and Seller pursuant to Section 1.

B. If Buyer is not the Sink Buyer, then Buyer shall notify the Other Buyer with whom Buyer has a contractual relationship of the Designated Interface promptly after Seller notifies Buyer thereof, with the intent being that the party bearing actual responsibility to secure transmission shall have up to 30 minutes after receipt of the Designated Interface to submit its Timely Request for Firm Transmission. ..

Item 10 Page 42 of 64
37 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association C. Seller and Buyer each agree that any other communications or actions required to be given or made in connection with this “Into Product” (including without limitation, information relating to an ADI) shall be made or taken promptly after receipt of the relevant information from the Other Sellers and Other Buyers, as the case may be.

D. Seller and Buyer each agree that in certain Transactions time is of the essence and it may be desirable to provide necessary information to Other Sellers and Other Buyers in order to complete the scheduling and delivery of the Product.

Accordingly, Seller and Buyer agree that each has the right, but not the obligation, to provide information at its own risk to Other Sellers and Other Buyers, as the case may be, in order to effect the prescheduling, scheduling and delivery of the Product “Native Load” means the demand imposed on an electric utility or an entity by the requirements of retail customers located within a franchised service territory that the electric utility or entity has statutory obligation to serve.
“Non-Firm” means, with respect to a Transaction, that delivery or receipt of the Product may be interrupted for any reason or for no reason, without liability on the part of either Party. “System Firm” means that the Product will be supplied from the owned or controlled generation or pre-existing purchased power assets of the system specified in the Transaction (the “System”) with non-firm transmission to and from the Delivery Point, unless a different Transmission Contingency is specified in a Transaction. Seller’s failure to deliver shall be excused: (i) by an event or circumstance which prevents Seller from performing its obligations, which event or circumstance was not anticipated as of the date the Transaction was agreed to, which is not within the reasonable control of, or the result of the negligence of, the Seller; (ii) by Buyer’s failure to perform; (iii) to the extent necessary to preserve the integrity of, or prevent or limit any instability on, the System; (iv) to the extent the System or the control area or reliability council within which the System operates declares an emergency condition, as determined in the system’s, or the control area’s, or reliability council’s reasonable judgment; or (v) by the interruption or curtailment of transmission to the Delivery Point or by the occurrence of any Transmission Contingency specified in a Transaction as excusing Seller’s performance. Buyer’s failure to receive shall be excused (i) by Force Majeure; (ii) by Seller’s failure to perform, or (iii) by the interruption or curtailment of transmission from the Delivery Point or by the occurrence of any Transmission Contingency specified in a Transaction as excusing Buyer’s performance.

In any of such events, neither party shall be liable to the other for any damages, including any amounts determined pursuant to Article Four.
“Transmission Contingent” means, with respect to a Transaction, that the performance of either Seller or Buyer (as specified in the Transaction) shall be excused, and no damages shall be payable including any amounts determined pursuant to Article Four, if the transmission for such Transaction is unavailable or interrupted or curtailed for any reason, at any time, anywhere from the Seller’s proposed generating source to the Buyer’s proposed ultimate sink, regardless of whether transmission, if any, that such Party is attempting to secure and/or has purchased for the Product is firm or non-firm. If the transmission (whether firm or non-firm) that Seller or Buyer is attempting to secure is from source to sink is unavailable, this contingency excuses performance for the entire Transaction. If the transmission (whether firm or non-firm) that Seller ..

Item 10 Page 43 of 64
38 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association or Buyer has secured from source to sink is interrupted or curtailed for any reason, this contingency excuses performance for the duration of the interruption or curtailment notwithstanding the provisions of the definition of “Force Majeure” in Article 1.23 to the contrary.
“Unit Firm” means, with respect to a Transaction, that the Product subject to the Transaction is intended to be supplied from a generation asset or assets specified in the Transaction. Seller’s failure to deliver under a “Unit Firm” Transaction shall be excused: (i) if the specified generation asset(s) are unavailable as a result of a Forced Outage (as defined in the NERC Generating Unit Availability Data System (GADS) Forced Outage reporting guidelines) or (ii) by an event or circumstance that affects the specified generation asset(s) so as to prevent Seller from performing its obligations, which event or circumstance was not anticipated as of the date the Transaction was agreed to, and which is not within the reasonable control of, or the result of the negligence of, the Seller or (iii) by Buyer’s failure to perform. In any of such events, Seller shall not be liable to Buyer for any damages, including any amounts determined pursuant to Article Four. ..

Item 10 Page 44 of 64
39 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association

EXHIBIT A

MASTER POWER PURCHASE AND SALE AGREEMENT

CONFIRMATION LETTER
This confirmation letter shall confirm the Transaction agreed to on ___________, ___ between __________________________ (“Party A”) and _____________________ (“Party B”) regarding the sale/purchase of the Product under the terms and conditions as follows:

Seller:

Buyer:

Product:
[] Into _________________, Seller’s Daily Choice
[] Firm (LD)
[] Firm (No Force Majeure)
[] System Firm
(Specify System: )
[] Unit Firm
(Specify Unit(s): )
[] Other
[] Transmission Contingency (If not marked, no transmission contingency) [] FT-Contract Path Contingency [] Seller [] Buyer
[] FT-Delivery Point Contingency [] Seller [] Buyer
[] Transmission Contingent [] Seller [] Buyer
[] Other transmission contingency
(Specify: )
Contract Quantity:

Delivery Point:

Contract Price:

Energy Price:

Other Charges: ..

Item 10 Page 45 of 64
40 Version 2.1 (modified 4/25/00)
©COPYRIGHT 2000 by the Edison Electric Institute and National Energy Marketers Association Confirmation Letter

Delivery Period:

Special Conditions:

Scheduling:

Option Buyer:

Option Seller:

Type of Option:

Strike Price:

Premium:

Exercise Period:

This confirmation letter is being provided pursuant to and in accordance with the Master Power Purchase and Sale Agreement dated ______________ (the “Master Agreement”) between Party A and Party B, and constitutes part of and is subject to the terms and provisions of such Master Agreement. Terms used but not defined herein shall have the meanings ascribed to them in the Master Agreement.
[Party A] [Party B]
Name: Name:

Title: Title:

Phone No: Phone No:

Fax: Fax: ..

Item 10 Page 46 of 64
1 RENEWABLE ENERGY CREDIT CONFIRMATION
FOR THE SALE AND PURCHASE OF PCC1 ENERGY
This Renewable Energy Credit Confirmation for the Sale and Purchase of PCC1 (this “Confirmation”) confirms the Transaction between Silver Peak Energy, LLC, a Delaware limited liability company (“Seller”) and City of Vernon, a Chartered City and Municipal Corporation of the State of California (“Buyer”) (each individually a “Party” and together the “Parties”), dated as of the last date signed below (the “Confirmation Effective Date”) for the purchase and sale of the Product (as defined herein) pursuant to the terms and conditions contained herein.

This Confirmation is governed by the Master Power Purchase and Sale Agreement (version 2.1., modified 4/25/00), as published by the Edison Electric Institute (the “EEI Form”) as modified by the Cover Sheet in Exhibit B attached hereto and incorporated by reference (collectively, the “Master Agreement”), all of which form a part of this Agreement. All provisions contained in or incorporated by reference in the EEI Form shall govern this Confirmation except as expressly modified herein or in Exhibit B, as if the Parties had executed such an agreement based on the EEI Form (as if modifications or elections specified in the Exhibit B were made on the Cover Sheet); provided, however, that the Parties acknowledge and agree that the Collateral Annex is not a part of and is not applicable to this Confirmation. The terms and conditions set forth herein shall constitute a “Transaction” under the Master Agreement. In the event of any inconsistency between the provisions of the Master Agreement and the terms specified in this Confirmation, this Confirmation shall prevail for purposes of this Transaction. The Master Agreement and this Confirmation shall be collectively referred to herein as the/this “Agreement”. Capitalized terms not otherwise defined in this Agreement shall have the meanings set forth in the CAISO Tariff.

AGREEMENT
Transaction: Seller shall sell to Buyer, and Buyer shall purchase from Seller, during the Delivery Term (as defined below), Product produced by a certain generating facility, as identified in this Confirmation, which qualifies as an ERR under the California RPS (as defined below), as codified at California Public Utilities Code Section 399.11, et seq.

Product:“Product” means As-Run electric energy (“Energy”) and associated Renewable Energy Credits (“RECs”) that meet the California RPS compliance requirements of California Public Utilities Code Section 399.16(b)(1) and CPUC Decision 11-12-052 (“Portfolio Content Category Product 1” or “PCC1”), produced during the Delivery Term by the Generating Facility listed herein. Product does not include any other non-renewable and environmental attributes (e.g., Ancillary Services or Resource Adequacy Capacity).

Seller: Silver Peak Energy, LLC
Buyer: City of Vernon ..

Item 10 Page 47 of 64
2 Delivery Term: March 1, 2024 through June 30, 2024
Generating
Facilities: The Generating Facility is identified below and further described in Exhibit A.

Generating
Facility/Project
Name
Resource ID WREGIS
ID
California Energy
Commission
(“CEC”)
Certification
Number
Capacity
(MW)
Silver Peak HAMLIN_1_BMSBT2 Seller to
provide. 64967 C 50
Delivery Point: CAISO Balancing Authority Area.

Scheduling: Seller or Seller’s designee shall schedule and deliver the Energy portion of the Product, on behalf of Buyer, to the Delivery Point, in accordance with the requirements and the prevailing protocols of the WECC and CAISO Tariff.

Contract
Quantity: Product associated with energy generated from the Generating Facility on an As-Run basis. The amount of Product delivered from Seller to Buyer during any applicable dispatch interval during the Delivery Term shall be limited to the actual output of each Generating Facility listed herein and shall not exceed 33,480 MWh in total over the course of the Delivery Term.

Contract Price:“Energy Contract Price” shall mean the price applicable to the Energy portion of the Product and shall equal the CAISO Locational Marginal Price calculated at the PNode for the Delivery Point on a dollar-per-megawatt- hour ($/MWh) basis. “REC Contract Price” shall mean the price applicable to the REC portion of the Product and shall equal $50/MWh.

California RPS
STC Provisions: (a) Seller, and, if applicable, its successors, represents and warrants that throughout the Delivery Term of this Agreement that: (i) the Project qualifies and is certified by the CEC as an Eligible Renewable Energy Resource (“ERR”) as such term is defined in Public Utilities Code Section 399.12 or Section 399.16; and (ii) the Project’s output delivered to Buyer qualifies under the requirements of the California Renewables Portfolio Standard. To the extent a change in law occurs after execution of this Agreement that causes this representation and warranty to be materially false or misleading, it ..

Item 10 Page 48 of 64
3 shall not be an Event of Default if Seller has used commercially reasonable efforts to comply with such change in law. STC 6. For purposes of this Agreement, “commercially reasonable efforts” shall not require expenditures by Seller in excess of the Capped Amount. (b) Seller and, if applicable, its successors, represents and warrants that throughout the Delivery Term of this Agreement the Renewable Energy Credits transferred to Buyer conform to the definition and attributes required for compliance with the California Renewables Portfolio Standard, as set forth in California Public Utilities Commission Decision 08-08-028, and as may be modified by subsequent decision of the California Public Utilities Commission or by subsequent legislation. To the extent a change in law occurs after execution of this Agreement that causes this representation and warranty to be materially false or misleading, it shall not be an Event of Default if Seller has used commercially reasonable efforts to comply with such change in law. STC REC-1
(c) Seller warrants that all necessary steps to allow the Renewable Energy Credits transferred to Buyer to be tracked in the Western Renewable Energy Generation Information System will be taken prior to the first delivery under the contract. STC REC-2 (d) This Agreement and the rights and duties of the Parties hereunder shall be governed by and construed, enforced and performed in accordance with the laws of the state of California, without regard to principles of conflicts of Law. To the extent enforceable at such time, each Party waives its respective right to any jury trial with respect to any litigation arising under or in connection with this Agreement. STC 17
Transfer of RECs: Prior to the first delivery of RECs under this Confirmation, each Party shall take all necessary steps to allow the RECs transferred by Seller and received by Buyer to be tracked in WREGIS. The transfer of RECs shall be made in accordance with the rules and regulations of WREGIS. After the final certification of the Generating Facility as an ERR, Seller shall transfer RECs associated with the Contract Quantity from its WREGIS account to Buyer’s WREGIS account. If Buyer’s WREGIS account ID is not available as of the Confirmation Effective Date, Buyer shall provide such information to Seller promptly upon receipt of the same. Seller shall deliver all RECs no later than April 1, 2026.

Vintage: Calendar Year(s): 2024.

Payment: To simplify the settlement process based on the current CAISO market scheduling and settlement protocols, the Parties agree that Seller shall ..

Item 10 Page 49 of 64
4 schedule and deliver Energy consistent with the Contract Quantity during the Delivery Period with and to the CAISO at the Delivery Point(s) (“Delivered Energy”), and Seller shall receive payment for such Delivered Energy from the CAISO at the Energy Contract Price. Consistent with applicable netting provisions of the Master Agreement, Seller and Buyer shall net such payment for Delivered Energy received by Seller such that the payment for Product that Seller shall receive from Buyer shall be calculated as follows:

Payment Due from Buyer to Seller = Delivered Energy * REC Contract Price.

For the avoidance of doubt, Buyer shall not be separately obligated to pay for Energy under this Transaction. In addition to any audit rights that Buyer may have under the Master Agreement, Seller shall, upon Buyer’s reasonable request, provide additional documentation (which may include meter data as recorded by a CAISO-certified meter) sufficient to confirm the volume of Delivered Energy.

Buyer shall transfer to Seller the aforementioned payment within fifteen (15) Business Days following receipt of Seller’s invoice (which shall be sent subsequent to each transfer of RECs), or the twentieth (20th) day of the month, whichever is later. If the due date is not a Business Day, then payment shall be due on the next Business Day. Invoices issued by Seller hereunder shall detail the RECs conveyed via WREGIS (i.e., Generating Facility Name, Vintage Month, CEC RPS ID, Delivered Energy, and REC Contract Price). Seller shall provide Buyer with a non-binding estimate of monthly meter data within fifteen (15) Business Days after the end of each month.

Applicable
Program: State of California Renewables Portfolio Standard Program (“California RPS”), as codified at California Public Utilities Code Section 399.11, et seq., and requiring that a specified percentage of a load-serving entity’s retail sales should be supplied with electricity generated by ERRs.

Tracking System: WREGIS.

Additional Seller
Representations
and Warranties: Seller represents and warrants to Buyer that:
(a) Seller has the right to sell the Product from the Generating Facility; ..

Item 10 Page 50 of 64
5 (b) Seller has not sold the Product to be transferred hereunder, or any Green Attribute associated therewith, to any other person or entity; (c) Product transferred hereunder shall be free and clear of all liens or other encumbrances; and
(d) Seller shall reasonably cooperate with Buyer, the CEC, and/or the California Public Utilities Commission to provide documentation required to support the Product’s classification as PCC1.

Change in Law
Provisions: This Confirmation is executed for the express purpose of complying with the California RPS and California Public Utilities Code Section 399.16(b)(1). The Product shall be regulatorily continuing, requiring that Seller use commercially reasonable efforts to obtain compliance with changes in law in the California RPS occurring after the Confirmation Effective Date, provided that Seller costs associated with such compliance shall not exceed five thousand dollars ($5,000) in total (the “Capped Amount”). Seller shall not be obligated to comply with changes in law with respect to Product that was delivered and accepted prior to the change in law if such Product complied as of the date of delivery and acceptance.

To the extent that a change in law renders the implementation of this Transaction impossible or impracticable, or otherwise materially changes, or revokes or eliminates, the California RPS, the Parties agree to negotiate in good faith to amend this Confirmation to maintain the original intent of the Parties as closely as possible.

Forward Contract: This Confirmation constitutes a sale of a nonfinancial commodity for deferred shipment or delivery that the Parties intend to be physically settled and is excluded from the term “swap” as defined in the Commodity Exchange Act and the regulations of the Commodity Futures Trading Commission and United States Securities and Exchange Commission.

Counterparts: This Confirmation may be signed in any number of counterparts with the same effect as if the signatures to the counterparty were upon a single instrument. Delivery of an executed signature page of this Confirmation by electronic mail transmission (including PDF) shall be the same as delivery of a manually executed signature page.

Definitions/
Interpretations: For purposes of the Confirmation, the following definitions and rules of interpretations shall apply:
“Applicable Law” means all legally binding constitutions, treaties, statutes, laws, ordinances, rules, regulations, orders, interpretations, permits, judgments, decrees, injunctions, writs and ..

Item 10 Page 51 of 64
6 orders or any Governmental Authority or arbitrator that apply to the California RPS or any one or both of the Parties or the terms hereof.
“As-Run” means that the remedy for non-delivery of the Product under Section 4.1 of the Master Agreement shall be applicable to this Confirmation except in the event and to the extent that, for any reason or no reason, a Generating Facility was not online to produce the Product. “CAISO” means the California ISO.
“CAISO Tariff” means the CAISO FERC Electric Tariff.
“Commercial Operation Date” has the meaning set forth in the CAISO Tariff. “Green Attributes” means any and all credits, benefits, emissions reductions, offsets, and allowances, howsoever entitled, attributable to the generation from the Generating Facility, and its avoided emission of pollutants. Green Attributes include but are not limited to RECs, as well as:
(a) any avoided emission of pollutants to the air, soil or water such as sulfur oxides (SOx), nitrogen oxides (NOx), carbon monoxide (CO) and other pollutants; (b) any avoided emissions of carbon dioxide (CO2), methane (CH4), nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulfur hexafluoride and other greenhouse gases (GHGs) that have been determined by the United Nations Intergovernmental Panel on Climate Change, or otherwise by law, to contribute to the actual or potential threat of altering the Earth’s climate by trapping heat in the atmosphere; (c) the reporting rights to these avoided emissions, including but not limited to Green Tag Reporting Rights. Green Tag Reporting Rights are the right of a Green Tag Purchaser to report the ownership of accumulated Green Tags in compliance with federal or state law, if applicable, and to a federal or state agency or any other party at the Green Tag Purchaser’s discretion, and include without limitation those Green Tag Reporting Rights accruing under Section 1605(b) of The Energy Policy Act of 1992 and any present or future federal, state, or local law, regulation or bill, and international or foreign emissions trading program. Green Tags are accumulated on a MWh basis and one Green Tag represents the Green Attributes associated with one (1) MWh of energy. Green Attributes do not include (i) any energy, capacity, reliability or other power attributes from the Generating Facility, (ii) production tax credits associated with the construction or operation of the Generating Facility and other financial incentives in the form of credits, reductions, or allowances associated with the Generating Facility that are applicable to a state or federal income taxation obligation, (iii) fuel-related subsidies or “tipping fees” that may be paid to Seller to accept certain fuels, or local subsidies received by the generator for the destruction of particular preexisting pollutants or the promotion of local environmental benefits, or (iv) emission reduction credits encumbered or used by the Generating Facility for compliance with local, state, or federal operating and/or air quality permits.
“WECC” means the Western Electricity Coordinating Council or its successor organizations. “WREGIS” mean the Western Renewable Energy Generation Information System, or its successor organization. ..

Item 10 Page 52 of 64
7 IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed as of the Confirmation Effective Date.

SILVER PEAK ENERGY, LLC CITY OF VERNON
By: By:

Name: Name:

Title: Title:

Date: Date: ..

Item 10 Page 53 of 64
8 EXHIBIT A
Unit Name: Silver Peak
RPS ID: 64967 C
Facility Location: Adelanto, California
Facility Directly Interconnected to a CBA: Yes
CBA Interconnection: SCE Roadway 115kV
Substation
Facility Generation Capacity: 50 MW
Facility Fuel Type: Solar*
*The Generating Facility is a DC-coupled hybrid solar PV + BESS system. ..

Item 10 Page 54 of 64
9 EXHIBIT B

MASTER POWER PURCHASE AND SALE AGREEMENT

COVER SHEET
This Master Power Purchase and Sale Agreement (Version 2.1; modified 04/25/00) (“Master Agreement”) is made as of the Confirmation Effective Date (“Effective Date”). The Master Agreement, together with the exhibits, schedules and any written supplements hereto, the Party A Tariff, if any, the Party B Tariff, if any, any designated collateral, credit support or margin agreement or similar arrangement between the Parties and all Transactions shall be referred to as the “Agreement.” The Parties to this Master Agreement are the following:

Name: Silver Peak Energy, LLC (“Party A”) Name: City of Vernon, a Chartered City and Municipal Corporation of the State of California
(“Party B”)
All Notices: All Notices: E-mail: [email protected] Attn: Legal
Phone: (801) 679-3500
Facsimile: (801) 679-3501
Duns: Party A to provide
Federal Tax ID Number: Party A to provide
City of Vernon
Public Utilities Department
4305 Santa Fe Avenue
Vernon, CA 90058
Attn: Shawn Sharif and Efrain Sandoval
Phone: (323) 826-1424
Email: [email protected]
[email protected]
Duns: 060883022
Federal Tax ID Number: 95-6000808
Invoices:

Attn: Revenue Manager
Phone: (801) 679-3500
Email: [email protected]
Invoices:

Attn: City of Vernon Treasury Department
Phone: (323) 583-8811 (x 227)
Email: [email protected]
Scheduling:

Attn: Control Room
Phone: (801) 679-3553
Email: [email protected]
Scheduling:

Attn: Shawn Sharif and Efrain Sandoval
Phone: (323) 826-1424
Email: [email protected]
[email protected]
Wire Transfer:

To be provided by separate notice
BNK: Party A to provide
ABA: Party A to provide
ACCT: Party A to provide
Wire Transfer:

BNK: East West Bank
ABA: 322070381
ACCT: 8003092007
ACCT NAME: Gas and Electric Account
Credit and Collections:

Attn: Revenue Manager
Phone: (801) 679-3500
Email: [email protected]
Credit and Collections:

Attn: Richard Corbi
Phone: (323) 583-8811 (x 390)
Email: [email protected]
..

Item 10 Page 55 of 64
10 With additional Notices of an Event of Default or
Potential Event of Default to:

Attn: Legal
Phone: (801) 679-3500
Facsimile: (801) 679-3501
Email: [email protected]
With additional Notices of an Event of Default or
Potential Event of Default to:

Attn: Zaynah Moussa
Phone: (323) 583-8811 (x 839)
Email: [email protected]
The Parties hereby agree that the General Terms and Conditions are incorporated herein, and to the following provisions as provided for in the General Terms and Conditions:

Party A Tariff N/A
Party B Tariff N/A
Article Two
Transaction Terms and Conditions Optional provision in Section 2.4. If not checked, inapplicable.

Article Four
Remedies for Failure
to Deliver or Receive
 Accelerated Payment of Damages. If not checked, inapplicable.

Article Five
Events of Default; Remedies Cross Default for Party A: N/A  Party A: Cross Default Amount $  Other Entity: Cross Default Amount $  Cross Default for Party B: N/A  Party B: Cross Default Amount $  Other Entity: Cross Default Amount $

5.6 Closeout Setoff  Option A (Applicable if no other selection is made.)  Option B (as amended pursuant to this Cover Sheet)  Option C (No Setoff) Article Eight 8.1 Party A Credit Protection:

Credit and Collateral Requirements (a) Financial Information:  Option A  Option B Specify:  Option C Specify: None ..

Item 10 Page 56 of 64
11 (b) Credit Assurances:  Not Applicable  Applicable (c) Collateral Threshold:  Not Applicable  Applicable (d) Downgrade Event:  Not Applicable  Applicable
If applicable, complete the following:  It shall be a Downgrade Event for Party B if [Party B’s][Party B’s Guarantor’s] Credit Rating falls below BBB- from S&P or Baa3 from Moody’s or if [Party B’s][Party B’s Guarantor’s] is rated by neither S&P nor Moody’s.  Other - specify:
(e) Guarantor for Party B: None
Guarantee Amount: N/A

8.2 Party B Credit Protection:
(a) Financial Information:  Option A  Option B Specify:  Option C Specify: None (b) Credit Assurances:  Not Applicable  Applicable
(c) Collateral Threshold:  Not Applicable  Applicable (d) Downgrade Event:  Not Applicable  Applicable
If applicable, complete the following:  It shall be a Downgrade Event for Party A if [Party A’s][Party A’s Guarantor’s] Credit Rating falls below BBB- from S&P or Baa3 from Moody’s or if [Party A’s][Party A’s ..

Item 10 Page 57 of 64
12 Guarantor’s] is rated by neither S&P nor Moody’s.  Other - specify:
(e) Guarantor for Party A: None
Guarantee Amount: N/A
Article Ten Confidentiality Applicable. If not checked, inapplicable.

Confidentiality
Schedule M
 Party A is a Governmental Entity or Public Power System  Party B is a Governmental Entity or Public Power System  Add Section 3.6. If not checked, inapplicable  Add Section 8.6. If not checked, inapplicable Other Changes
This Master Power Purchase and Sale Agreement incorporates, by reference, the changes published in the EEI Errata, Version 1.1, dated July 18, 2007.

Part 1. GENERAL TERMS AND CONDITIONS.
(A) Article One: General Definitions. The following definitions are amended as set forth below:
(1) Section 1.3 is amended in its entirety to read as follows: “Bankrupt” means, with respect to a Party or other entity, that such Party or other entity (i) is dissolved (other than pursuant to a consolidation, amalgamation or merger); (ii) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (iii) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (iv) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors’ rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (a) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (b) is not dismissed, discharged, stayed or restrained, in each case within 60 days of the institution or presentation thereof; (v) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (vi) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (vii) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 60 days thereafter; (viii) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (i) to (vii) (inclusive); or (ix) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts.” ..

Item 10 Page 58 of 64
13 (2) Section 1.4 is amended by deleting the first sentence and replacing it to read as follows: “Business Day” means any day except a Saturday, Sunday, the Friday immediately following the Thanksgiving holiday or a Federal Reserve holiday.
(3) Section 1.12 is amended in its entirety to read as follows: “Credit Rating” means, with respect to any entity on any date of determination, the respective rating then assigned to its unsecured senior long-term debt or deposit obligations (not supported by third party credit enhancement), by S&P, Moody’s or such other rating agency or agencies as are specified; and if no rating is assigned to such entity’s unsecured, senior long-term debt or deposit obligations by such rating agency, the general corporate credit rating or long-term issuer rating, as applicable, assigned by such rating agency to such entity. (4) Section 1.50 is amended by changing “Section 2.4” to “Section 2.5.” (5) Section 1.51 is amended by (i) adding the phrase “for delivery” immediately before the phrase “at the Delivery Point” in the second line and (ii) deleting the phrase “at Buyer’s option” from the fifth line and replacing it with the following: “absent a purchase.” (6) Section 1.53 is amended by (i) deleting the phrase “at the Delivery Point” from the second line, and (ii) deleting the phrase “at Seller’s option” from the fifth line and replacing it with the following:
“absent a sale” and (iii) inserting after the phrase “commercially reasonable manner” in the sixth line, the following phrase “; provided, however if the Seller is unable after using commercially reasonable efforts to resell all or a portion of the Product not received by Buyer, the Sales Price with respect to such Product shall be deemed equal to zero (0)”. (7) Section 1.56 is amended by deleting the words “pursuant to Section 5.2” and by adding before the period at the end thereof the following: “,as determined in accordance with Section 5.2.” (8) Section 1.60 is amended by inserting the words “in writing” immediately following the words “agreed to.”
(B) Article Two: Transaction Terms and Conditions.
(1) Section 2.1 is amended by deleting the first sentence in its entirety and replacing it with the following: “A Transaction, or an amendment, modification or supplement thereto, shall be entered into only upon a writing signed by both Parties.”
(2) Section 2.3 is deleted in its entirety and replaced with the following:
“2.3 Confirmation. A Transaction shall be entered into only by a written confirmation in a form mutually agreeable to both Parties and signed by both Parties (“Confirmation”). Notwithstanding anything to the contrary in this Master Agreement, the Master Agreement and any and all Confirmations may not be amended or modified except by an instrument in writing signed by both of the Parties.”
(3) Section 2.4 is amended to delete the phrase “either orally or” from the seventh line thereof. (4) Section 2.5 is amended by deleting the last two sentences thereof in their entirety. (C) Article Five: Events of Default; Remedies. ..

Item 10 Page 59 of 64
14 (1) Section 5.2 is amended by reversing the placement of “(i)” and “to”. (2) Section 5.2 is amended by deleting the following phrase from the last line: “as soon thereafter as is reasonably practicable).” and replacing it with the following:
“then each such Transaction shall be terminated as soon thereafter as reasonably practicable, and upon termination shall be deemed to be a Terminated Transaction and the Termination Payment payable in connection with all such Transactions shall be calculated in accordance with Section 5.3 below). The Gains and Losses for each Terminated Transaction shall be determined by the Non- Defaulting Party in a commercially reasonable manner by calculating the amount that would be incurred or realized to replace or to provide the economic equivalent of the remaining payments or deliveries in respect of that Terminated Transaction. In making such calculation, the Non- Defaulting Party shall reference information supplied by one or more third parties including, without limitation, quotations (either firm or indicative) of relevant rates, prices, yields, yield curves, volatilities, spreads or other relevant market data in the relevant markets, and information obtained through a recognized exchange, clearinghouse, or reference entity, with such adjustments that the Non-Defaulting Party determines, acting in good faith and in a commercially reasonable manner, are applicable based on the specific terms of such Transaction or Transactions. Third parties supplying such information may include dealers, brokers and information vendors, including, without limitation, Intercontinental Exchange, Inc. If the Non-Defaulting Party’s calculation of a Settlement Amount results in an amount that would be due to the Defaulting Party (i.e., the Defaulting Party was in the money), then the Settlement Amount shall be deemed to be zero dollars ($0.00). If quotations or relevant market data from third party sources are not readily available, the Non-Defaulting Party may reference to information of the types described above as are available from internal sources (including any of the Non-Defaulting Party’s affiliates) if that information is of the same type used by the Non-Defaulting Party in the regular course of its business for the valuation of similar transactions.”
(D) Article Ten: Miscellaneous
(1) In Section 10.2, delete the phrase “(including any Confirmation accepted in accordance with Section 2.3)” from Sections 10.2(ii), (iii), (iv), (vi), (vii), (viii), (x) and (xi). (2) Subsection (ix) of Section 10.2 is deleted in its entirety and replaced with the following:
“(ix)(A) it is a ‘forward contract merchant’ within the meaning of the United States Bankruptcy Code; and (B) it is an ‘eligible contract participant’ as such term is defined in the Commodity Exchange Act, as amended (7 U.S.C. § 1(a)(12)).”
(3) Section 10.4 is amended by adding the following sentence at the end thereof:
“The indemnifying Party shall not be obligated to indemnify, defend, or hold harmless the indemnified Party with respect to any Claim to the extent such Claim resulted from the indemnified Party’s negligence, willful misconduct, or bad faith.”
(4) Section 10.5 is amended by deleting the phrase “which consent may be withheld in the exercise of its sole discretion” in the second line and replacing it with “which consent shall not be unreasonably withheld”.
..

Item 10 Page 60 of 64
15 (5) Section 10.6 is amended by changing “NEW YORK” to “CALIFORNIA”. (6) Section 10.8 is amended by inserting the following at the end thereof:
“This Agreement may be signed in any number of counterparts with the same effect as if the signatures to the counterparts were upon a single instrument. Delivery of an executed signature page of this Agreement by a PDF attached to an email shall be the same as delivery of a manually executed signature page. The Parties may rely on electronic and or scanned signatures as originals under this Agreement. Copies of this Agreement (and each amendment, modification and waiver in respect of it) are deemed acceptable and may be used in lieu of originals for all purposes, including, but not limited to admissibility, authenticity or other purposes related to legal proof.” (7) Section 10.11 is deleted in its entirety and replaced with the following:
“10.11 Confidentiality. If the Parties have elected on the Cover Sheet to make this Section 10.11 applicable to this Master Agreement, neither Party shall disclose the terms or conditions of a Transaction under this Master Agreement or the completed Cover Sheet or any annex to this Master Agreement to a third party (other than the employees, lenders or potential lenders, investors or potential investors, counsel, accountants or advisors of a Party or its Affiliates to whom disclosure is reasonably required (with respect to a Party, its “Representatives”)) except in order to comply with any applicable law, regulation, or any exchange, control area or independent system operator rule or in connection with any court or regulatory proceeding or request by a regulatory authority; provided, however, each Party shall, to the extent practicable, use reasonable efforts to prevent or limit the disclosure. The existence of this Agreement is not subject to this confidentiality obligation provided that neither Party shall make any public announcement relating to this Agreement unless otherwise required pursuant to this Section

10.11.The Parties shall be entitled to all remedies available at law or in equity to enforce, or seek relief in connection with, the non-disclosure obligations set forth in this Section 10.11; provided, that a breach of this Section 10.11 shall not give rise to a right to suspend or terminate any ongoing Transaction under this Agreement. Notwithstanding the foregoing, it shall not be deemed a breach of this Section 10.11 if a Party disclosed the terms or conditions of a Transaction, provided that the name of and any other identifying information relating to the other Party is redacted and otherwise not disclosed. Each Party will cause its Representatives to comply with the non-disclosure obligations set forth in this Section

10.11. Party A and Party B acknowledge and agree that the Master Agreement and any Transactions entered into in connection therewith are subject to the requirements of the California Public Records Act (Government Code Section 7920 et seq.). In order to designate information as confidential, the disclosing party must clearly stamp and identify the specific portion of the material designated with the word “Confidential.” However, the Parties failure to designate information as confidential does not waive or limit the Parties’ rights to object to the production of material or assert exemptions to the requested documents. The Parties agree not to over-designate material as confidential. Over-designation would include stamping whole agreements, entire pages or series of pages as Confidential that clearly contain information that is not confidential.

Upon request or demand of any third person or entity not a Party hereto to Party B pursuant to the California Public Records Act for production, inspection and/or copying of Confidential Information (“Requested Confidential Information”), Party B will as soon as practical notify Party A in writing via email that such request has been made. In no event, will Party B provide Party A less than 30 days’ notice before it produces Confidential Information to any third person or entity.

Party A will be solely responsible for taking at its sole expense whatever legal steps are necessary to prevent release of the Requested Confidential Information to the third party by Party B. If Party A takes no such action after receiving the foregoing notice from Party B, Party B shall, at its ..

Item 10 Page 61 of 64
16 discretion, be permitted to comply with the third party’s request or demand and is not required to defend against it. If Party A does take or attempt to take such action, Party B shall provide timely and reasonable cooperation to Party A, if requested by Party A, and Party A agrees to indemnify and hold harmless Party B, its officers, employees and agents (“Party B Indemnified Parties”), from any claims, liability, award of attorneys’ fees, or damages, and to defend any action, claim or lawsuit brought against any of Party B Indemnified Parties for Party B’s refusal to disclose any Requested Confidential Information.”
(8) Article 10 is amended by inserting the following as a new Section 10.12:
“10.12 Venue. Each party hereto irrevocably (i) submits to the exclusive jurisdiction of the courts of the State of California and the United States District Court located in San Francisco, California; (ii) waives any objection which it may have to the laying of venue of any proceedings brought in any such court; and (iii) waives any claim that such proceedings have been brought in an inconvenient forum. Each party waives, to the fullest extent permitted by applicable law, any right it may have to a trial by jury in respect of any suit, action or proceeding relating to this Agreement.” (9) Article 10 is amended by inserting the following as a new Section 10.13:
“10.13 FERC Standard of Review; Mobile-Sierra Waiver.
a. Absent the agreement of all Parties to the proposed change, the standard of review for changes to any rate, charge, classification, term or condition of this Agreement, whether proposed by a Party (to the extent that any waiver in subsection (b) below is unenforceable or ineffective as to such Party), a non-party or FERC acting sua sponte, shall solely be the “public interest” application of the “just and reasonable” standard of review set forth in United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 (1956) and Federal Power Commission v. Sierra Pacific Power Co., 350 U.S. 348 (1956) and clarified by Morgan Stanley Capital Group, Inc. v. Public Util. Dist. No. 1 of Snohomish 554 U.S. 527 (2008) and further refined in NRG Power Marketing v. Maine Public utilities Commission, 558 U.S. 165 (2010) ( the “Mobile-Sierra” doctrine).
b. In addition, and notwithstanding the foregoing subsection (a), to the fullest extent permitted by applicable law, each Party, for itself and its successors and assigns, hereby expressly and irrevocably waives any rights it can or may have, now or in the future, whether under §§ 205 and/or 206 of the Federal Power Act or otherwise, to seek to obtain from FERC by any means, directly or indirectly (through complaint, investigation or otherwise), and each hereby covenants and agrees not at any time to seek to so obtain, an order from FERC changing any section of this Agreement specifying the rate, charge, classification, or other term or condition agreed to by the Parties, it being the express intent of the Parties that, to the fullest extent permitted by applicable law, neither Party shall unilaterally seek to obtain from FERC any relief changing the rate, charge, classification, or other term or condition of this Agreement, notwithstanding any subsequent changes in applicable law or market conditions that may occur. In the event it were to be determined that applicable law precludes the Parties from waiving their rights to seek changes from FERC to their market- based power sales contracts (including entering into covenants not to do so) then this subsection (b) shall not apply, provided that, consistent with the foregoing subsection (a), neither Party shall seek any such changes except solely under the “public interest” application of the “just and reasonable” standard of review and otherwise as set forth in the foregoing section (a).”
..

Item 10 Page 62 of 64
17 SCHEDULE M: GOVERNMENTAL ENTITY OR PUBLIC POWER SYSTEMS.

Schedule M is hereby deleted in its entirety and replaced with the following:
(1) The following sentence shall be added to the end of the definition of “Force Majeure” in Article One:
“If the Claiming Party is a Governmental Entity or Public Power System, Force Majeure does not include any action taken by the Governmental Entity or Public Power System in its governmental capacity.”
(2) The Parties agree to add the following section to Article Three:
“Section 3.4 No Immunity Claim. Party B warrants and covenants that with respect to its contractual obligations hereunder and performance thereof, it will not claim immunity on the grounds of sovereignty or similar grounds with respect to this Master Agreement or any credit support provided with respect to this Master Agreement or the Collateral Annex from (a) suit, (b) jurisdiction of court (including a court located outside of the jurisdiction of its organization), (c) relief by way of injunction, order for specific performance or recovery of property, (d) attachment of assets, or (e) execution or enforcement of any judgment; provided, however, that nothing in this Agreement shall waive the obligations and/or rights set forth in the California Government Claims Act (Government Code Section 810 et seq.).”
(3) The Parties agree to add the following representations and warranties to Section 10.2:
“Further and with respect to a Party that is a Governmental Entity or Public Power System, such Governmental Entity or Public Power System represents and warrants to the other Party continuing throughout the term of this Master Agreement, with respect to this Master Agreement and each Transaction, as follows: (i) all acts necessary to the valid execution, delivery and performance of this Master Agreement, including without limitation, competitive bidding, public notice, election, referendum, prior appropriation or other required procedures has or will be taken and performed as required under the Governmental Entity or Public Power System’s ordinances, bylaws or other regulations, (ii) all persons making up the governing body of Governmental Entity or Public Power System are the duly elected or appointed incumbents in their positions and hold such positions in good standing in accordance with applicable law, (iii) entry into and performance of this Master Agreement by Governmental Entity or Public Power System are for a proper public purpose within the meaning of all relevant constitutional, organic or other governing documents and applicable law, (iv) the term of this Master Agreement does not extend beyond any applicable limitation imposed by relevant constitutional, organic or other governing documents and applicable law, (v) the Governmental Entity or Public Power System’s obligations to make payments hereunder are unsubordinated obligations and such payments are (a) operating and maintenance costs (or similar designation) which enjoy first priority of payment at all times under any and all bond ordinances or indentures to which it is a party, all relevant constitutional, organic or other governing documents and applicable law or (b) otherwise not subject to any prior claim under any and all bond ordinances or indentures to which it is a party, all relevant constitutional, organic or other governing documents and applicable law and are available without limitation or deduction to satisfy all Governmental Entity or Public Power System’ obligations hereunder and under each Transaction or (c) to be made solely from a Special Fund, (vi) entry into and performance of this Master Agreement and each Transaction by the Governmental Entity or Public Power System will not adversely affect the exclusion from gross income for federal income tax purposes of interest on any obligation of ..

Item 10 Page 63 of 64
18 Governmental Entity or Public Power System otherwise entitled to such exclusion, and (vii) obligations to make payments hereunder do not constitute any kind of indebtedness of Governmental Entity or Public Power System or create any kind of lien on, or security interest in, any property or revenues of Governmental Entity or Public Power System which, in either case, is proscribed by any relevant constitutional, organic or other governing documents and applicable law, any order or judgment of any court or other agency of government applicable to it or its assets, or any contractual restriction binding on or affecting it or any of its assets.” (4) The Parties agree to add the following sentence at the end of Section 10.6- Governing Law:
“IN RESPECT OF THE APPLICABILITY OF THE ACT AS HEREIN PROVIDED, THE LAWS OF THE STATE OF CALIFORNIA SHALL APPLY.”
..

Item 10 Page 64 of 64
City Council Agenda Report
Meeting Date: February 6, 2024
From: Freddie Agyin, Director of Health and Environmental Control Department: Health and Environmental Control
Submitted by: Veronica Petrosyan, Deputy Director of Health and Environmental Control
Subject
Environmental Sustainability Action Plan
Recommendation
Adopt the Environmental Sustainability Action Plan.

Background
An Environmental Sustainability Action Plan (ESAP) serves as a detailed long-range strategy to achieve sustainability in the sectors of greenhouse gas emissions, energy transportation, land use, solid waste, water, biological resources, air quality, public health, and economic development. The City’s ESAP was adopted in 2011 and due for an update. One of the duties of the Green Vernon Commission (GVC) is to periodically review the City’s ESAP and make recommendations to City Council regarding amendments to the Plan. At a Special Meeting on August 24, 2022, the Commission directed staff to update the City’s 2011 ESAP and appointed two of its members to a temporary ad hoc committee to work with the Staff Steering Committee to provide support, guidance, and oversight of the ESAP update project. Subsequently, based on a Request for Proposals process, a contract was awarded to Environmental Science Associates (ESA) to update the ESAP.

Over a year-long process, ESA engaged with various stakeholders, including residents, the general public, the ESAP Steering Committee, the GVC, and City departments, to gather input on sustainability priorities and develop the ESAP’s goals and strategies. Based on the analysis of data and information collected as part of the project’s outreach and engagement efforts, a draft ESAP was developed in October 2023. The draft ESAP was reviewed by City departments and the GVC on December 12, 2023. Feedback received was incorporated in the final ESAP being presented to the City Council for consideration and adoption.

Fiscal Impact
There is no fiscal impact associated with this report.

Attachments

1. Environmental Sustainability Action Plan ..

Item 11 Page 1 of 82
Environmental Sustainability Action Plan
Acronyms and Abbreviations
i
Environmental
Sustainability
Action Plan
DECEMBER 2023
..

Item 11 Page 2 of 82
City of Vernon Environmental Sustainability Action Plan ii Table of Contents Table of Contents1
Executive Summary 4
Acknowledgements6
Plan Organization9
Chapter 1: Introduction 10
Chapter 2: Sustainability
Sectors, Goals and
Strategies 14
Greenhouse Gas Emissions (GHG) 14
Energy 18
Transportation 22
Materials and Waste 26
Water 30
Food Systems 34
Community Health and Resilience 38
Chapter 3: Implementation 42
References 50
Appendices 53
Appendix A: Outreach Memorandum
Appendix B: Existing Conditions Assessment
Table of
Contents
..

Item 11 Page 3 of 82
City of Vernon Environmental Sustainability Action Plan 2 Acronyms and Abbreviations Acronyms and Abbreviations3 Acronyms and Abbreviations
City of Vernon
AB 32 Assembly Bill 32 Global Warming
Solutions Act of 2006
AB 341 Assembly Bill 341 Mandatory
Commercial Recycling
AB 197 Assembly Bill 197 California Global
Warming Solutions Act of 2006 –
Direct Emissions
AB 802 Assembly Bill 802 Energy Efficiency
Act of 2016
AB 1279 Assembly Bill 1279 Carbon Neutrality
AB 1668 Assembly Bill 1668 Water Management
Planning Act of 2018
AB 1826 Mandatory Commercial Organics
Recycling
AQMD South Coast Air Quality Management
District
CalRecycle California Department of Resources
Recycling and Recovery
CARB California Air Resources Board
CBMWD Central Basin Municipal Water District
ESA Environmental Science Associates
ESAP or Plan Environmental Sustainability
Action Plan
EV electric vehicle
Gateway
Cities
or GCCOG Gateway Cities Council of
Governments
GHG Greenhouse gas
GVC Green Vernon Commission
GPCD Gallons per capita per day
GWFG Golden West Food Groups
GWh gigawatt-hour
IRP Integrated Resource Plan
LA Los Angeles
LAFPC Los Angeles Food Policy Council
LHMP Local Hazard Mitigation Plan
MGS Malburg Generating Station
MWh Megawatt-hour
MTCO2e Metric tons of carbon dioxide
equivalent
OEHHA California Office of Environmental
Health Hazard Assessment
PM fine particulate matter
ROI Return on Investment
SB 32 Senate Bill 32 California Global
Warming Solutions Act of 2006 –
2030 Emissions Limit
SB 100 Senate Bill 100, 100% Clean Energy Act
of 2018
SB 350 Senate Bill 350 Clean Energy and
Pollution Reduction Act of 2015
SB 379 Senate Bill 379 Land use: General plan:

Safety element. 2015
SB 606 Senate Bill 606 Water Management
Planning of 2018
SB X7-7 Senate Bill Water Conservation
Act of 2009
SB 1020 Senate Bill 1020 Clean Energy, Jobs,
and Affordability Act of 2022
SB 1383 Senate Bill 1383 California’s
Short-Lived Climate Pollutant
Reduction Law of 2016
SCAG Southern California Association
of Governments
SMI Strategic Materials Inc.

Solar PV
Systems Solar photovoltaic systems
SOV single occupancy vehicle
UWMP Urban Water Management Plan
VMT Vehicle miles traveled
VPU Vernon Public Utilities
WEA Wellness Equity Alliance
ZEV Zero-emission vehicles
..

Item 11 Page 4 of 82
City of Vernon Environmental Sustainability Action Plan 4 Executive Summary Executive Summary5
Executive Summary
City of Vernon Environmental Sustainability Action Plan The City of Vernon’s 2023 Environmental Sustainability
Action Plan (ESAP) represents a renewed commitment
to a greener, cleaner, and more sustainable community
for the City’s operations, as well as local businesses
and residents. The Health and Environmental Control
department is leading the effort to strengthen the City’s sustainability policies, promote stronger collaborations across key sectors, and take action to reduce
greenhouse gas emissions throughout the community.

This ESAP builds on the City’s existing programs
and practices while providing a framework for
guiding future progress in seven key areas: • Greenhouse Gas Emissions • Energy • Transportation • Water • Food Systems • Materials and Waste • Community Health and Resilience The goals, strategies, and actions within these sectors will work together towards a more resilient community
– one that addresses climate change hazards and the
demand from growing industries and population.

Vernon advocates for an equitable, sustainable,
and resilient future for current and forthcoming
generations, ensuring the City thrives amid the
challenges of our changing world.
..

Item 11 Page 5 of 82
City of Vernon Environmental Sustainability Action Plan 6 Executive Summary Executive Summary7
Acknowledgements
This Environmental Sustainability Action Plan is developed with the support and in collaboration with diverse groups within the City, including the project Steering Committee that is comprised of twelve representatives from seven City Departments, the Green Vernon Commission, and City staff from Health and Environmental Control, Public Utilities, and Public Works.

Green Vernon Commission
Catherine Browne
Clara Gazcon
Ron Daerr
Ronit Edry
Hector Morfin
Martin Perez
Stan Stosel
Project Steering Committee and City Departments Staff
Catherine Browne, Green Vernon Commission
Ron Daerr, Green Vernon Commission
Marisa Olguin, Chamber of Commerce
Nicole Helms, rPlant Earth
Freddie Agyin, Health & Environmental Control
Veronica Petrosyan, Health & Environmental Control
Daniel Suggs, Health & Environmental Control
Lisa Umeda, Public Utilities
Zaynah Moussa, City Attorney
Ernesto Smith, IT Department
Scott Williams, Finance
Angela Kimmey, Administration
Lilia Hernandez, Administration
Diana Figueroa, Administration
Lisa Pope, City Clerk
Michael A. Earl, Human Resources
Lisette Grizzelle, Human Resources
Daniel Wall, Public Works
Sergio Canales, Public Works
Robert Sousa, Police Department
Brandon Gray, Police Department
..

Item 11 Page 6 of 82
City of Vernon Environmental Sustainability Action Plan 8 Executive Summary Executive Summary9
City of Vernon
CHAPTER 1
Introduction
This chapter outlines the purpose and scope of the Environmental Sustainability Action Plan, emphasizing the City’s commitment to sustainability amid global climate change challenges. The chapter explores the significance of environmental stewardship, detailing the responsible management of natural resources and the pressing need for sustainable practices. It describes Vernon’s history and commitment to sustainability, and highlights the critical role of businesses in the City’s sustainable future through the concept of a circular economy. The chapter concludes by providing an overview of the strategies planned for implementation, outlining the major sectors, and emphasizing the importance of feasibility and community support in shaping these sustainability strategies.

CHAPTER 2
Sustainability Sectors, Goals, and Strategies
Chapter 2 dives into each sector of sustainability relevant to Vernon. These seven sectors include Energy, Greenhouse Gas Emissions, Energy, Transportation, Materials and Waste, Water, Food Systems, and Community Health and Resilience. Each sector includes these topics: • Existing Conditions: Each sector begins with a summary of existing conditions and outlines specific challenges and opportunities unique to Vernon. • Goals, Metrics, Strategies, and Actions: Goals outline the objectives the City wants to achieve; metrics offer measurable criteria for annual progress; strategies outline the general approaches, and; actions detail the specific steps needed to achieve the objectives.
• Social, Economic, and Environmental Co-benefits: This section highlights the strategy co-benefits, including improved public health, economic resilience, social equity, and environmental conservation.
• Fiscal Considerations: This section considers the financial and budgetary implications of implementing the strategies and actions outlined in the ESAP, including assessments regarding costs, funding requirements, and economic impacts. The ESAP advocates for strategic investments that generate long-term gains and enhance the City’s financial and environmental resilience.
• Vignettes: This section showcases local initiatives, highlighting successful programs, partnerships, and community-driven efforts. It provides real-world examples of how sustainability practices are being effectively implemented across the City of Vernon, inspiring further community and business participation.

CHAPTER 3
Implementation
This chapter outlines recommended steps for implementing the sustainability strategies described in Chapter 2. It identifies potential funding sources and assigns implementation responsibility to specific City departments, presenting a high-level schedule for implementation.

Plan Organization
..

Item 11 Page 7 of 82
City of Vernon Environmental Sustainability Action Plan 10 Introduction Introduction 11
Introduction
City of Vernon Environmental Sustainability Action Plan CHAPTER 1
What is Sustainability and
Why Are We Doing This?
The City of Vernon (City) has reinforced its commitment to sustainability. Given increasing pressures on
environmental resources and the growing risks that
the City faces from climate change, the need has never
been greater for sustainable solutions that increase
community resilience and bring multi-benefits to local
businesses, workers, and residents. While state and
regional policies and programs are helping to increase
sustainability more broadly, the City’s efforts are critical to building a tailored response that addresses the
environmental challenges most relevant to Vernon’s
unique community. This Environmental Sustainability
Action Plan identifies sustainability goals and targets for Vernon to implement, through coordination with
local businesses, stakeholders, and residents identified as significant partners to ensuring accountability,
transparency, and long-term change.

Vernon’s History of Environmental
Stewardship
Environmental stewardship is crucial in addressing
the challenges posed by a growing population,
global climate change and limited natural resources.

Environmental stewardship refers to the responsible
management and care of the environment. It involves
actively protecting natural resources, conserving
biodiversity, and ensuring sustainable practices for
current and future generations. Southern California
faces significant risks from climate change, which is
resulting in more extreme weather events, worsening
air quality, and more threats to public health including new disease vectors. Through this ESAP, the City
continues its commitment to sustainability and to
aligning with the sustainability goals of the City of
Vernon General Plan, a commitment that has the City’s
departments and commissions engaged at various
levels in promoting sustainable practices. For example, the Department of Health and Environmental Control
and the Green Vernon Commission (GVC) focus largely
on food systems, materials and waste, greenhouse gas
emissions, and community environmental health and
safety; the Public Utilities Department of the City of
Vernon focuses on energy use, renewable energy, and
water use; and Public Works focuses on transportation.

The City of Vernon is enhancing its environmental
stewardship efforts through updates to its essential
plans, including the Local Hazard Mitigation Plan
and General Plan Housing and Safety elements, all of
which incorporate policies addressing climate change
and sustainability. The City is also making zoning
changes to diversify land uses, improve amenities,
..

Item 11 Page 8 of 82
City of Vernon Environmental Sustainability Action Plan 12 Introduction Introduction 13
attract skilled workers, and uphold its status as an
industrial hub. Collaborating with organizations like
the Gateway Cities Council of Governments (Gateway
Cities or GCCOG), Loyola Marymount University
Center for Urban Resilience, and TreePeople, the City
recently conducted an urban Tree Canopy Prioritization
assessment to assess its existing and potential urban
greening opportunities. This initiative aims to create
community-wide benefits, including greener spaces,
improved aesthetics, shading, heat mitigation,
enhanced air quality, and better pedestrian pathways
through strategic tree plantings.

Vernon’s robust foundation for addressing
environmental challenges is built on past regional
efforts and ongoing programs. Initiatives such as
the regional Gateway Cities Climate Action Planning
Framework, LA County’s Our County Sustainability Plan,
and Southern California Association of Governments’
(SCAG) Regional Climate Adaptation Framework
provide a strong foundation for the City’s ESAP.

The City’s existing policies and programs, including
comprehensive greenhouse gas inventories and
mandatory emissions reporting, are integral to its
sustainability approach. Likewise, the City’s previous
Sustainability Action Plan completed in 2011, which
outlines targets and actions across multiple sectors,
serves as a guiding framework for Vernon’s continuous
commitment to environmental stewardship and
resilience.

Vernon’s Business Community – The
Key Player In Our Sustainable Future
Vernon’s land area is mostly designated for industrial
use. This distinctive status as an industrial city is
reflected in the General Plan, which features a single
land use category (Industrial) and seven Overlay
Zones (Commercial-1, Commercial-2, Rendering,
Slaughtering, Housing, Emergency Shelter, and Truck
and Freight Terminal) as determined in the City’s
Comprehensive Zoning Ordinance, that cater to
the community’s specific needs and requirements.

Consequentially, businesses represent most of the
City’s energy consumption and its contributions to
greenhouse gas emissions.

Vernon’s business community is at the forefront of the
City’s sustainable future and its vision for a circular economy. A circular economy eliminates waste,
promotes material reuse and recycling, and repurposes
resources. Unlike the traditional linear economy, where products are made, used, and then discarded as waste,
the primary goal of a circular economy is to keep
products, materials, and resources in use for as long as possible, thereby reducing the environmental impact
of material production.

The City knows that for businesses to thrive,
organizations must be prudent with their finances. In a competitive market, businesses must make decisions
grounded in the return on investment (ROI). This
balance between financial caution and environmental
responsibility is where Vernon’s businesses become
key players. By integrating sustainable practices
within their operations, many of the City’s businesses
are reducing their environmental footprint while
contributing significantly to the City’s circular
economy. This ability to become both financially and
environmentally sustainable is at the root of sustainable business practices and represents an essential
component of Vernon’s journey towards a greener,
more sustainable future.

Community Input
The unique community characteristics of the City
of Vernon are deeply rooted in its industrial legacy.

Vernon serves as a robust economic powerhouse
with over 1,800 businesses and an employment
base of approximately 55,000 individuals. Since
its establishment in 1905, Vernon has exemplified
industrial progress, cultivating an environment where
business thrives. The City takes pride in its businessfriendly policies and the dedicated support provided by its municipal staff, emphasizing a personalized
approach to every company. At the same time, the
City is preparing for a growing population in the
coming years through various mixed-use residential
developments.

To understand the aspirations and concerns of its
diverse community, development of this ESAP included
extensive outreach to businesses and residents.

Through virtual meetings and workshops with the
Steering Committee, an online community survey,
and personalized one-on-one engagements with key
businesses and leaders, the project team obtained
valuable insights. These interactions revealed the
community’s top priorities, concerns, and goals. The
data collected during these outreach initiatives became the foundation upon which the ESAP was constructed,
ensuring that it not only addresses the City’s unique
characteristics but also resonates with the aspirations of its people and businesses.

The outreach findings highlighted several key priorities and concerns within the community. The Steering
Committee discussed and expanded outreach
activities, including dissemination of a multilingual
survey for businesses, employees, and residents.

The survey results stressed the importance of public
health, while the Steering Committee emphasized
the importance of fiscal sustainability as a key
concept. Climate change emerged as the central
concern, transcending the sustainability concerns
associated with transportation, fiscal responsibility,
waste management, water usage, air quality, energy
efficiency, and the environmental impacts associated
with the food supply.

Greenhouse Gas Emissions
The City will seek to reduce GHG emissions by improving the energy efficiency of existing buildings and implementing electrification strategies where applicable.

Energy
The City will take actions to procure zero-carbon electricity, increase distributed renewable energy resources, and develop energy storage/microgrids.

Transportation
The City will expand infrastructure to support zero emission vehicles (ZEV) and increase bicycle and pedestrian activity; transition the City fleet to greener alternatives; and expand car and bike sharing. The City will support transit-oriented and mixed-use development.

Materials and Waste
The City will divert solid waste and organics from landfills.

Water
The City will reduce community and municipal per capita water use through water conservation and reuse.

Food Systems
The City will decrease food waste, increase food accessibility and local circular economy of the food industry.

Community Health and Resilience
The City will increase resilience to climate hazards through adaptive measures that provide health benefits for people and the environment.

Strategies to Increase Sustainability
In developing this ESAP, the City of Vernon considered
many potential strategies and actions to support
sustainability goals. Best-suited measures were chosen
primarily based on feasibility of implementation and
the support received from businesses, residents, and
City staff. The strategies and actions are organized into the major categories shown below and described in
detail in Chapter 2: Sustainability Sectors, Goals, and Strategies.
..

Item 11 Page 9 of 82
14 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 15 City of Vernon Environmental Sustainability Action Plan Sustainability Sectors,
Goals, and Strategies
City of Vernon Environmental Sustainability Action Plan Increasing concentrations of greenhouse gas
emissions in the atmosphere are a primary
driver of global warming, which is causing
significant and long-term changes in the
earth’s system, including changing weather
patterns and the warming of oceans.

Climate change is rapidly emerging as a
major threat to global health and economic
prosperity in the 21st century, as it will
bring direct and indirect societal impacts
that are far-reaching, with disproportionate
impacts to vulnerable populations. The
extent and severity of future climate change
will largely depend on how effective the
global community will be in reducing GHG
emissions over the next several decades.

CHAPTER 2

GREENHOUSE GAS EMISSIONS
Existing Conditions
Community greenhouse gas (GHG) emission
inventories for Vernon, which include all emissionsgenerating activity within the City, are available for calendar years 2010 and 2015 through regional
planning efforts by the Gateway Cities Council of
Governments and the Los Angeles County’s Chief
Sustainability Office. Municipal GHG inventories, which account for emissions from the City’s buildings and
operations, are available for the years 2010 through
2020 through Vernon Public Utilities. These efforts
are summarized in Appendix B – Existing Conditions
Summary.

The 2015 community GHG inventory shows a total
of 939,293 metric tons of carbon dioxide equivalent
(MTCO2e).
1 Energy consumption, which includes
electricity and natural gas, accounted for 36% of the
2015 total, followed by stationary emissions from the
Malburg Generating Station (a source regulated by the
California Air Resources Board) at 34%, transportation
(19%), solid waste (8%), off-road equipment (2%), shortlived climate pollutants (1%), and water and wastewater (<1%). From 2010 to 2015, total emissions decreased
by approximately 15%, with the largest volume of
reductions associated with the MGS and electricity
use. The sector with the largest percent reduction was
natural gas (27%). 1 Note that refinements were made to the 2015 and 2010 GHG inventories to allow comparisons across the two years, primarily related to revised transportation and socioeconomic data, updates to emission factors for vehicles and electricity, and updated methods for estimating emissions from
wastewater and solid waste.
..

Item 11 Page 10 of 82
16 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 17 City of Vernon Environmental Sustainability Action Plan Vernon Public Utilities (VPU) leads collection,
quantification, and reporting of the City’s emissions
from municipal operations, accounting for stationary
and mobile sources, and purchased energy. These
emissions represent a small subset of the community
inventory (less than 3%) but come from sources
over which the City has the most control. The
City is committed to addressing GHG emissions
through monitoring initiatives and infrastructure
improvements; this includes regular updates of
the VPU’s GHG Inventory Management Plan and its
mandatory reporting to California Air Resources Board
and U.S. Environmental Protection Agency, along
with implementation of the City’s Five-Year Capital
Improvement Plan, which aims to reduce VPU’s carbon
footprint by upgrading switches and circuit breakers
that are insulated with sulfur hexafluoride gas and
replacing them with vacuum insulated equipment.

Challenges
• Achieving local reductions in line with state targets and mandates will require a major shift to renewable
energy, zero-carbon buildings, and zero-emission
vehicles
Opportunities
• Expected growth in jobs and business opportunities
in the CleanTech industry, due to growing need for
low-carbon solutions
• Increasing availability of state and federal resources to support local climate action
Goals (G)
Goal G1 Reduce community GHG
emissions in alignment with state targets
Key Performance Metrics
• Annual GHG emissions inventory (community wide
and municipal operations)
• Progress toward local emissions reduction targets
(yet to be established)
Strategies and Actions
Note: Strategies and actions that reduce GHG
emissions from the other sectors covered in this ESAP
are noted as such by use of the icon.

G1-a: Develop a detailed climate action plan
for reducing emissions throughout the
community and tracking progress towards
targets that align with state mandates.
• Set a communitywide target for emissions reductions
in alignment with the state’s goals for 2030 (SB 32
and AB 1279).
• Develop an updated community GHG inventory to
assess emissions trends since completion of the last
inventory in 2015.
• Leverage existing partnerships, existing inventory
data, and the Environmental Sustainability Action
Plan to position the City to access funds for the
development of a climate action plan.
• Develop a vulnerability assessment to address
environmental justice and assess social and
environmental vulnerability to climate change
hazards, including impacts to people, places, and
infrastructure.
• Identify needs for adaptation and resiliency measures to address the impacts of climate change hazards.

Sustainability Co-Benefits
SOCIAL. Promotes equity, environmental
justice, and public health improvements.

ECONOMIC. Reduces costs relating to longterm adaptation and recovery from severe impacts.

ENVIRONMENTAL. Reduces severity
from climate change impacts and
air quality improvements.

Fiscal Considerations
Local governments must prioritize resources and
available budget for day-to-day operations and
maintenance. For many cities, this does not include
long-term considerations for addressing climate
change. Securing dedicated funding for climate action
planning will be critical. As such, planning is needed
to determine the cost-effectiveness of emissions
reduction strategies, identifying benefits to the
community and property owners, evaluating the costs
of inaction, and determining the City’s capacity for
implementation.

Aligning with State Targets and
Regulations
California is a global leader in addressing climate
change through policies and programs that
reduce GHG emissions throughout the economy.

Many of these regulations apply at the state
level, but some are state-imposed mandates with
requirements for local jurisdictions like the City of
Vernon.

Assembly Bill (AB) 32, known as the Global
Warming Solutions Act of 2006, directed the
state to reduce statewide GHG emissions to
1990 levels by 2020. Senate Bill (SB) 32 signed
by Governor Brown in 2016 deepened that
commitment to 40% below 1990 levels by 2030,
while AB 1279 (2022) legally binds the state to
achieving carbon neutrality by 2045, including
a statewide reduction of at least 85% below
1990 levels within that timeframe. State agencies
including the California Air Resources Board and
the Office of Planning and Research recommend
local jurisdictions develop community-wide
targets and strategies to align with state goals.

Vernon is committed to doing its part to support
the state’s GHG emissions reductions goals. While
the Environmental Sustainability Action Plan
does not set a target for emissions reductions, it
establishes a communitywide goal for reducing
emissions aligned with science-based targets and
in alignment with state regulations. The goals,
strategies and actions outlined herein set the
foundation for Vernon to prepare a local climate
action plan that is focused on GHG emissions
through strategies and actions that provide the
greatest benefit to the community.

Local Spotlight –
Westside Specific Plan
The Westside Specific Plan in Vernon aims to
revitalize the diverse Westside area near the
Arts District in Los Angeles. It provides a good
example of how the California Environmental
Quality Act (CEQA) and the state’s GHG reduction
targets are affecting local land use planning. To
minimize GHG emissions, the plan promotes
adaptive reuse of existing development, changes
in truck routes that redirect traffic to create
pedestrian-friendly areas, and development of
green corridors along railways and streets. The
plan also envisions leveraging the City’s central
location – with proximity to downtown Los Angeles
and connections to the ports and valley region –
and reliable electric service to increase electric
vehicle charging stations and support zeroemission vehicles on the road.

Creation of a communitywide climate action plan
for Vernon would help guide future development
to be designed and structured in ways that
minimize GHG reductions and align with state
climate goals.

Sector 2010 GHG
Emissions
(MTCO2e)
2010 Percent
of Total
2015 GHG
Emissions
(MTCO2e)
2015 Percent
of Total
Malburg Generating Station 364,003 33% 317,815 34%
Electricity Use 334,316 30% 264,522 28%
Transportation 184,485 17% 179,052 19%
Natural Gas Use 100,404 9% 73,553 8%
Solid Waste 83,869 8% 71,632 8%
Off-Road Equipment 19,973 2% 19,973 2%
Short-Lived Climate Pollutants 12,734 1% 12,734 1%
Water & Wastewater 12 0% 13 0%
Total Emissions (MTCO2e) 1,099,795 939,293 ..

Item 11 Page 11 of 82
18 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 19 City of Vernon Environmental Sustainability Action Plan ENERGY
City of Vernon
Clean energy is energy derived from
renewable sources like solar, wind,
hydro, and geothermal, which have lower
environmental impacts and produce
minimal GHG emissions compared to
fossil fuels. Renewable energy sources
rely on natural processes and resources
that are continuously replenished,
rendering them more sustainable
in the long run. By promoting clean
energy, Vernon can transition toward a
more sustainable future where energy
production and consumption align with
ecological and societal needs.

Existing Conditions
Vernon Public Utilities provides electricity to almost
2,000 customers, mostly commercial and industrial,
through locally generated power and purchased
power sourced from renewables, natural gas, market
purchases, and nuclear resources. This includes the
Malburg Generating Station (MGS), a city-owned
combined-cycle natural gas-fired generating plant,
which will supply 32% of the City’s 2024 energy mix.

The largest portion will be from renewable resources
(43%), with remaining resources coming from market
purchases (15%), nuclear resources (8%), and large
hydro (1%).

Vernon aims to be a leader in eco-friendly energy
practices, building on past efforts to increase energy
efficiency and consumption of renewable energy. In
2008, Vernon purchased 30,000 acres in Kern County
for wind and solar power to boost renewable energy
service. In 2017, the City added supply from additional projects like Antelope DSR Solar, Astoria II Solar and
Puente Hills Landfill Gas, and most recent in 2023
Daggett Solar. In 2026, the City will include Saphire
Solar to meet California’s renewable mandate. Five
years ago, natural gas generation from MGS made up
the majority of the City’s energy mix (56%). In 2024 VPU will reduce natural gas generation to 32% and increase
its renewable sources from 31% to 43%.

The City has set ambitious goals in its 2023 Integrated Resource Plan for sustainable energy management and
enhancing the resilience of energy systems to ensure a
reliable energy supply: • Increase transition to clean, renewable energy sources, aiming for 60% renewable energy in its
overall power mix by 2030, 90% zero-carbon by
2035, 95% zero-carbon by 2040, and 100% zerocarbon by 2045 (in alignment with state mandates SB 350, SB 100, and SB 1020).
• Promote the adoption of solar photovoltaic (PV)
systems at public and private facilities in partnership with customers and property owners.
• Encourage the efficient use of energy through
incentives and outreach, with an annual energy
efficiency target of 2.6 giga watt-hour (GWh) through
2031.
• Replace and upgrade aging infrastructure to
maintain system reliability.
• Evaluate utility-scale solar and solar plus storage
power-purchase agreements for delivery by 2030.

Aligning with State Targets and Regulations
California is a global leader in addressing climate change through policies and programs that reduce GHG emissions throughout the economy. Many of these regulations apply at the state level, but some are state-imposed mandates with requirements for local jurisdictions like the City of Vernon.

Assembly Bill (AB) 32, known as the Global Warming Solutions Act of 2006, directed the state to reduce statewide GHG emissions to 1990 levels by 2020. Senate Bill (SB) 32 signed by Governor Brown in 2016 deepened that commitment to 40% below 1990 levels by 2030, while AB 1279 (2022) legally binds the state to achieving carbon neutrality by 2045, including a statewide reduction of at least 85% below 1990 levels within that timeframe.

State agencies including the California Air Resources Board and the Office of Planning and Research recommend local jurisdictions develop community-wide targets and strategies to align with state goals.

Vernon is committed to doing its part to support the state’s GHG emissions reductions goals. While the Environmental Sustainability Action Plan does not set a target for emissions reductions, it establishes a communitywide goal for reducing emissions aligned with science-based targets and in alignment with state regulations. The goals, strategies and actions outlined herein set the foundation for Vernon to prepare a local climate action plan that is focused on GHG emissions through strategies and actions that provide the greatest benefit to the community. 2023
Integrated
Resource
Plan
Challenges
• Increasing the energy mix with more renewable
sources increases costs for customers
• Difficult to transition some industries to renewables (e.g., cement; heavy industry)
• Renewables are most abundant when the sun is
shining, creating a need for more energy storage
• Need for workforce training to support the clean
energy economy
Opportunities
• Price of renewables continues to trend lower • Ample business and job opportunities in cleantech/climate tech, energy efficiency, building
electrification, and renewable energy installations
• Reducing the use of fossil fuels results in cleaner air and better public health outcomes
Goals (E)
Goal E1 Transition to clean, renewable
energy sources: 60% by 2030, 90% by
2035, 95% by 2040, and 100% by 2045
Goal E2 Improve energy efficiency of new
and existing buildings throughout the
community
Goal E3 Increase community energy
resilience
Key Performance Metrics
• Percent of community electricity supply supplied by
zero-carbon sources
• Annual energy efficiency savings (GWh or megawatt
(MWh))
..

Item 11 Page 12 of 82
20 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 21 City of Vernon Environmental Sustainability Action Plan Strategies and Actions
E1-a: Procure and deliver more renewable
electricity to the grid.

E1-b: Enable businesses and residents to
adopt carbon free distributed energy
resources.
• Develop programs and initiatives that promote
customer adoption of carbon free distributed energy
resources; supports procurement of local renewable
energy.
• Streamline the permitting process for solar PV
installations.
• Implement a transparent reporting system that tracks
the number of installed solar PV systems, energy
generation, and GHG emissions reductions.
• Provide resources that allow businesses and residents to assess the solar potential of their properties.

E2-a: Encourage building electrification and
energy efficiency.
• Incentivize customers to exceed Title 24
standards for energy efficiency and promote
electrification for new buildings and major retrofits
on existing buildings.
• Promote community access to funding and technical
assistance programs for energy efficiency and
electrification improvements in existing buildings,
including education on VPU’s incentive
programs.

E2-b: Develop community partnerships
to evaluate deployment of new
technologies and infrastructure to
reduce energy-related emissions.
• Identify key community partners, local businesses,
research institutions, and public agencies that
can contribute to the reduction of energy-related
emissions.

E3-a: Promote the adoption of microgrid
technologies.
• Launch community workshops to educate
residents, businesses, and local leaders about the
benefits of microgrid technologies.
• Collaborate with relevant regulatory bodies to
streamline permitting processes and overcome
regulatory barriers that may hinder the deployment
of microgrids.
• Establish incentive programs for businesses
and homeowners to encourage the adoption of
microgrid technologies that will enhance overall grid
resilience.
• Develop a long-term maintenance and upgrade
plan to ensure the continued effectiveness of utilityscale microgrid technologies. Organize collaborative workshops and forums where stakeholders share
ideas and innovative solutions for emissions
reduction.

Sustainability Co-Benefits
SOCIAL. Promotes new job opportunities in the
clean energy sector.

ECONOMIC. Boosts energy independence,
resiliency against fossil fuel price fluctuations,
cost savings for the City and businesses and
fosters new business opportunities.

ENVIRONMENTAL. Reduces GHG emissions
and emissions of local criteria air pollutants, and
contributes to global efforts to mitigate climate
change.

Fiscal Considerations
Increasing the procurement of renewable energy
typically requires a greater level of investment upfront, with higher costs to customers. Vernon continues to
increase solar and wind energy purchases that meet
state renewable targets and are cost-effective for
customers, as well as energy storage solutions that
increase reliability. A portfolio with geothermal or
green hydrogen would result in a cleaner and more
efficient supply, but represents a significant cost
investment with a longer rate of return. VPU’s 2023
Integrated Resource Plan evaluated different options
for greening Vernon’s renewable energy portfolio,
and compared rates for customers based on portfolio
options. Costs to customers for solar/wind/and
energy storage were less than half the costs for green
hydrogen. VPU will continue to assess its portfolio as
future conditions change, and renewable procurement
becomes more accessible and affordable.

Local Spotlight – Golden West Food Group
Golden West Food Group (GWFG) is a bulk supplier of raw, frozen, and prepared foods for retail, commercial and institutional use. Since 2012, GWFG has been reporting on its own sustainability performance, accounting for its use of materials and energy sources. GWFG has implemented several practices to keep its material recycling loop close to home. It sends its used fats and oils to a local renderer for processing into biodiesel, which it then purchases to fuel its own truck fleet. It also specifies the use of 50% minimum recycled content in its paperboard products, and sources these products from a local processor which uses GWFG’s own recyclable paper and cardboard as feedstock.

GWFG also subscribes to a pallet-management system to minimize wasted shipping pallets. GWFG reduces its energy intake and emissions through upgraded equipment such as LED light bulbs, on-demand lighting, chillers for space cooling, and energy-efficient compressors. The company reduces its transportation carbon footprint by scheduling its work shifts to minimize commute time and by optimizing its boxes and pallet loads to utilize the maximum space on each truck.
..

Item 11 Page 13 of 82
22 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 23 City of Vernon Environmental Sustainability Action Plan

TRANSPORTATION
An efficient transportation system can
provide diverse options for travel that
help to reduce GHG emissions from
decreased vehicle miles traveled (VMT),
reduce fuel costs and improve traffic
congestion and air quality. Sustainable
transportation means connected and safe
roadways for pedestrians, bicyclists, and
motorists, and more efficient modes of
transport that include electric vehicles,
public transit, and active transportation.

Existing Conditions
Vernon’s transportation network is made up of 76-miles
of local roadway and freeway, with key connections to
industrial businesses and neighboring communities,
where a majority of the City’s workforce commutes
from. Major roads like Alameda Street, Atlantic
Boulevard, and Slauson Avenue facilitate access to
downtown Los Angeles, local ports, and provide
connections to I-710 to the east; I-5, I-10, and CA-60
to the north, and I-110 further west. The I-710 offers
a direct link to the Port of Long Beach and to other
highways that connect to the Port of Los Angeles, from
one of the largest railyards in the country, Hobart Yard.

Vernon also hosts the BNSF Railway and Union Pacific
Rail yards, and Los Angeles Junction Railway switching
services, which are critical to the region’s goods
movement and economy.

Public transportation service is provided by LA Metro,
with the Vernon light rail station (Blue Line) located to the west on Vernon Avenue and Long Beach Avenue.

Additionally, the Metro Bus Service operates over 10
routes in Vernon, serving local stops and connecting to neighboring cities.

Within the City’s municipal fleet, the majority of
vehicles are gasoline-fueled light-duty trucks. There are currently ten (10) electric- and one (1) gasoline/electric vehicle in the fleet. Vernon recently expanded its clean transportation infrastructure by installing its first public electric vehicle (EV) DC fast charging station, which
features 18, Level 3 fast chargers available 24/7 for EV drivers, and a second public EV fast charging station in development.

Challenges
• Only one bikeway exists in Vernon, along the LA River trail to the east
• Zero or low-emission trucks and heavy-duty
vehicles are expensive and in the early stages of
technological development; these vehicles are not
yet commercially available
• Reducing VMT requires safe walking and biking
routes, convenient public transit, and changing the
single occupancy vehicle (SOV) mindset
Sustainable Transportation Connections
Collaborations with regional agencies are leading to new and improved active transportation modes in Vernon, such as the LA River Path project developed in partnership with LA Metro. This project envisions a connected, shared-use bicycle and pedestrian path along the LA River, through Vernon and connecting the San Fernando Valley to the north, and Long Beach to the south. The LA River bicycle path is the only existing bikeway in Vernon. Addressing gaps in the bike trail will enhance connectivity to major employers in Vernon and provide another option for commuters driving to and from work and home. The river bikeway is anticipated to open in 2027.

Vernon’s LA River Active Transportation Access study is building on the regional bikeway effort to assess potential corridors and gateways for critical first- and last-mile connections to transit, the LA River path, and key destinations and employers in Vernon. As Metro’s LA River Path project comes to completion, Vernon will be wellpositioned to pursue funding for designing three bikeway corridors along 37th Street, Vernon Avenue, and Leonis/ District Boulevard.

Opportunities
• The City’s Bicycle Master Plan provides a framework
for a citywide system that promotes bicycling and
walking as a viable transportation mode and for
recreation
• Vernon’s major corridors are served by transit, and
employment areas are proximate to regional rail
commuter stations.
• The transition to EVs and other zero-emission
vehicles (ZEVs) is accelerating due to state
regulations, government funding, private sector
investment and technological advancements
• Large amounts of funding for ZEVs and supporting
infrastructure are becoming available from the state
and federal governments
• Business opportunities are increasing for developing
and supporting ZEV technologies, and infrastructure
is expanding specifically for electric and hydrogen
powered vehicles
Goals (T)
Goal T1 Reduce traffic congestion and
vehicle emissions
Goal T2 Increase the use of ZEVs
throughout the community
Goal T3 Create a safe, reliable, and efficient
network for walking, biking, public transit,
and new forms of mobility
Key Performance Metrics
• Number of publicly accessible EV charging stations • Miles of dedicated bike lines and pedestrian routes Strategies and Actions
T1-a: Reduce truck emissions of criteria air
pollutants.
• Coordinate with Caltrans regarding the I-710
project and modifications to local freeway ramps that
affect local roadways.
• Coordinate with local businesses to identify
strategies that facilitate goods movement and
minimize the potential negative impacts on people
and infrastructure.
22 Sustainability Sectors, Goals, and Strategies ..

Item 11 Page 14 of 82
24 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 25 City of Vernon Environmental Sustainability Action Plan T1-b: Coordinate with local businesses and
developers to reduce on-road VMT.
• Work with businesses and community leaders to
identify VMT reduction strategies that are most
aligned with local land use patterns and business
needs, to help reduce vehicle trips and trip lengths in Vernon.
• Coordinate with Metro to complete the LA River gap
closure.
• Encourage the Westside Specific Plan as a model
for the development of future transportation
infrastructure that coordinates with land use changes
and provides multimodal infrastructure that can help
reduce VMT for both residents and employees of the
area.
• Conduct a detailed assessment of existing
transportation infrastructure, identifying areas where
the City can integrate the Westside Specific Plan
principles.
• Promote car-sharing and carpooling for businesses
and employers.

T2-a: Expand and maintain EV charging
infrastructure.
• Identify locations for adding public EV chargers. • Seek funding for expanding and maintaining public EV charging infrastructure.
• Raise awareness with local businesses of funding
opportunities for on-site EV chargers.

T3-a: Promote active transportation and
transit.
• Implement the Active Transportation Plan for
dedicated cycling lanes, pedestrian walkways, and
safe crossing points that encourage non-motorized
transportation modes.
• Apply for funding to support active transportation
trails.
• Work with businesses to enhance walking and
cycling infrastructure around their premises, such as
bike racks, pedestrian pathways, hydration stations,
and secure storage for personal bicycles.
• Coordinate with Metro to complete the LA River gap
closure.
• Identify key transit corridors in partnership with local transit agencies, to prioritize and enhance public
transportation options in line with the Westside
Specific Plan’s multimodal focus.

Sustainability Co-Benefits
SOCIAL. Provides diverse travel options for
people, increases physical activity, improves
public health, and reduces risk of chronic
diseases.

ECONOMIC. Reduces costs relating to active
transportation modes and costs for fueling.

ENVIRONMENTAL. Reduces GHG emissions;
provides greater connectivity.

Fiscal Considerations
The transportation sector often entails costly
infrastructure improvements and development,
in addition to ongoing maintenance to support
daily industry and goods movements. Sustainable
transportation can be lower cost, as it prioritizes
cleaner vehicles, active modes of travel, and enhanced
access to existing connections. This can mean
reduced costs for fleets, vehicle owners, and fueling
and maintenance. Vernon is uniquely positioned,
geographically and as an employment hub, to
strengthen connections between places of work,
nearby residential communities, and other community
destinations.

Local Spotlight – Crown Poly
Crown Poly, founded in Los Angeles in 1991, produces film plastic and plastic bags for home and commercial uses. Crown Poly’s sustainability practices include using shrimp shells to make plastic adhesive, local sourcing of pallets, inks and corrugated cardboard, and sourcing recycled plastic feedstock, including recovered ocean plastics.

Their sustainability efforts are also reflected in their transportation-related initiatives. Crown Poly focuses on recruiting employees residing within a 30-mile radius of their Vernon plant, with production staff recruited within a 10-mile radius. This localized approach to hiring helps minimize commute distances and reduce transportation emissions. Crown Poly also sponsors employee carpooling and encourages the use of electric vehicles among its workforce by offering free workplace EV charging. In addition, the company optimizes its shipping processes by utilizing a direct rail spur, enhancing energy efficiency. ..

Item 11 Page 15 of 82
26 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 27 City of Vernon Environmental Sustainability Action Plan

MATERIALS AND WASTE
Reusing and recycling materials
rather than sending them to landfills
or incineration facilities – the essence
of a “circular economy” – is essential
to protecting the environment and
conserving resources for future
generations. Embracing the circular
economy promotes the highest and best
use of materials and helps minimize the
distance of materials traveled, reducing
energy use and GHG emissions. This
sustainable approach to managing
waste and materials positively impacts
public health by reducing pollution and
exposure to harmful substances.

Existing Conditions
Vernon’s industrial profile gives it a natural advantage as a circular economy leader. Its compact footprint
contains companies that recycle diverse materials,
such as glass, metal, and animal biproducts, as well
as companies such as glassware manufacturers and
biofuel producers that use those materials as feedstock for their products.

The City’s 2021 tonnage report shows a total of
135,073 tons of solid waste sent to landfills, an 8%
decrease from 2020. Detailed information is not
available on the origins or composition of Vernon’s
discards, so the analysis below is based on statewide
waste characterization averages, modified based on
Vernon’s employment numbers by industry, to yield
an approximation of Vernon’s waste characteristics.

The Waste Sources figure shows waste generation by
percentage, with the majority of solid waste attributed to food manufacturing (35%). By material categories,
organics represent the largest estimated percentage
of total waste generation at 27% as the Waste Material
Categories figure demonstrates. The waste is primarily
disposed of at Sunshine Canyon, located about 30
miles northwest of Vernon, with other landfills like El Sobrante and Olinda Alpha also being used.

The General Plan includes policies to enhance safety
from hazardous material waste and disposal sites. The
City annually reports solid waste tonnage by hauler
and also hosts electronic waste recycling and disposal
events for businesses and residents to encourage
proper disposal practices.

Challenges
• Existing market forces often incentivize the wasting
of materials
• Rendering animal biproducts into usable resources
can pose air quality challenges
• Variability in recycling feedstock quality can increase disposal
• Diversion is not effectively measured and there is a
lack of waste characterization data
• Conforming with Senate Bill 1383 (state-mandated
organics recycling) requires engagement with
multiple waste haulers
Opportunities
• The City has a high industrial density, with
established patterns of business-to-business material
cycling and a concentration of recycling businesses
• Vernon’s well-developed rail network allows for
materials to be moved in bulk, reducing the need for
disposable transport packaging such as boxes and
pallet wrap
• Reuse, rental, repair, and recycling all create jobs • Recycled glass requires less energy than virgin glass production, which can reduce GHGs and other air
pollutants.
• The City of Vernon 2023 Local Hazard Mitigation
Plan (LHMP) suggests working with waste service
contractors to promote safe disposal practices,
mainly focusing on hazardous waste materials.

Aligning with State Targets and
Key Regulations
California’s SB 1383 went into effect January
1, 2022, establishing targets to achieve a 50%
reduction in organic waste disposal by 2020 and
a 75% reduction by 2025, compared to 2014
levels. It expands the scope of existing mandatory
organics and recycling laws, including AB 1826
and AB 341, by requiring all residents and
businesses to participate, and by mandating that
every jurisdiction provide organic waste collection
in addition to recycling and trash collection
services to all residents and businesses. SB 1383
also requires large generators of surplus edible
food to donate any excess food to food recovery
organizations to assist people in need.

By material categories, organics represent the greatest estimated percentage of total waste generation (27%), followed by metal (27%), paper (26%, inerts and other (11%), and plastic (7%).

Other categories generate less than 2%.

WASTE MATERIAL CATEGORIES
Percentage of Vernon’s Total Waste Generation
Organics Metal Paper Inserts Plastic Other
0 10
20 30
26 27 27
<2
7 11

WASTE SOURCES
The majority of solid waste
in Vernon is generated
from manufacturing. Food
manufacturing generates the
highest amount of waste. The
percentage of solid waste
produced by manufacturing
and other business groups are
ranked in the following order:

CalRecycle, 2022
0 355
15 10
20 25
30 30%
35%
25%
Less
than
4%
Wholesale &
Trucking
Other Business
Groups
Food
Other
..

Item 11 Page 16 of 82
28 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 29 City of Vernon Environmental Sustainability Action Plan • Gather local waste characterization data to understand what types of materials are going to the
landfill. Improve data from haulers and obtain access
to waste metrics of the business community.

Sustainability Co-Benefits
SOCIAL. Reduces pollution and exposure to
harmful substances, improving air and water
quality and community health.

ECONOMIC. Promotes localized production
and resource management, enhancing
community resilience to economic shocks and
shortages.

ENVIRONMENTAL. Reduces landfill use,
pollution, and habitat destruction.

Goals (M)
Goal M1 Continue to Grow Vernon’s
Circular Economy
Goal M2 Maximize the effectiveness of
waste management systems
Goal M3 Reduce 75% of organic waste
disposed in landfills by 2025
Key Performance Metrics
• Tons of solid waste sent to landfill • Tons of organics sent to landfill • Number of businesses participating in materials exchange programs
Strategies and Actions
M1-a: Support waste prevention through
product and packaging redesign.
• Connect businesses with educational resources,
expert advice, and potential funding opportunities
to help them reduce or eliminate non-reusable
packaging and switch to reusable transport
packaging.
• Support, publicize, and patronize (through City
procurement) businesses that evaluate and redesign
their products and packaging to prevent waste.

M1-b: Support local materials exchange. • Identify resources for local materials exchange; identify and publicize the materials exchange
resources available within Los Angeles County and
beyond.
• Launch an awareness campaign to highlight
local exchange activity and to inform businesses
and residents in Vernon about the benefits of
participating in local materials exchange.
• Offer workshops, webinars, and training sessions to
guide participants on effectively utilizing materials
exchange networks.
• Conduct an inventory of the City of Vernon’s own
surplus materials, waste, and potential recyclables
and make this information publicly available.
• Implement a system to track resources exchanged
and to consider greenhouse gas implications of
these exchanges.

M1-c: Improve information and resources on City
webpage.
• Facilitate the matchmaking of available resources in
Vernon with the needs of other participants in the
materials exchange network.
• Ensure a user-friendly interface and updates as new
information becomes available.
• Regularly publish progress on performance metrics.

M1-d: Align the City’s procurement processes
with the requirements of SB 1383 to
minimize toxics and waste, and incentivize
local businesses to do the same.
• Update City purchasing preferences and contracts
to incorporate sustainability criteria such as: Local
sourcing, Use of recycled materials, Waste reduction,
Toxic reduction, Materials reuse, and Minimal
packaging.
• Promote the City’s Green Purchasing Plan (which
conforms with SB 1383) as an example to local
businesses and encourage them to adopt similar
plans.

M2-a: Maximize benefits of the waste diversion
system.
• Work with haulers to increase transparency and
accountability for high diversion goals.
• Ensure agreements incentivize diversion facilities to maintain high diversion efficiency.
• Partner with haulers to identify/develop incentives
that reward businesses for consistently adhering to
sorting guidelines.
• Gather feedback from employees, businesses,
haulers, sorting and processing facilities, and local
users of end products to refine the sorting
process and maintain accuracy of guidelines.

M3-a: Increase Reuse & Recycling of
materials and organics.
• Translate sorting guidelines and educational
materials into multiple languages, to increase
education and reach around reuse and recycling.
• Organize workshops or demonstrations at
community events and schools to showcase how to
prevent waste and sort materials.
• Incentivize equipment rental & repair businesses by
publicizing them in City communications, convening
workshops to raise awareness of rental and repair
options, techniques, and the local businesses who
provide them, and by including preference for
repaired and shared resources in city procurement
contracts.

Local Spotlight – Strategic Materials
Inc.

The Strategic Materials Inc. (SMI) facility in Vernon
processes glass-rich materials from recycling programs
and from industry into color-separated glass cullet
for new glass products. Batteries recovered from the
incoming feedstock are sent to local processors for
further sorting and then extraction of valuable metals.

The company also recycles pallets, cardboard, and
ferrous metals. To save energy, the plant uses LED
lighting.

The facility employs 30-35 staff, offering “second
chance” employment for individuals who have been
in the criminal justice system. SMI prioritizes bringing more women into its workforce, running a forum called
“Breaking The Glass Ceiling” to highlight its female
employee’s achievements and to support women’s
career advancement. SMI provides employees with
refillable water bottles and bottle-filling stations and runs a “Glass Warriors” initiative to promote employee
environmental literacy and action, both professionally
and personally.

Fiscal Considerations
Adopting sustainable waste management practices
involves infrastructure, technology, and community
engagement costs. For example, infrastructure
investments may be needed to establish or upgrade
recycling facilities, upgrade waste treatment plants,
or develop a materials exchange platform. While such
investments may be costly, the long-term benefits
include reduced landfill usage, lowered transportation
costs, and potential revenue. In addition, transitioning to a circular economy model requires systemic
production, consumption, and waste management
changes. However, over time, a circular economy
can reduce the demand for raw materials and lower
production costs, contributing to fiscal sustainability.

While a financial investment is involved in adopting
sustainable waste management practices, the longterm benefits, cost savings, and revenue generation can significantly enhance Vernon’s economy and
environment.
..

Item 11 Page 17 of 82
30 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 31 City of Vernon Environmental Sustainability Action Plan WATER
Water conservation and sustainable water
management are essential components
of addressing and adapting to climate
change in Vernon. Scientists observe that
climate change is altering precipitation
patterns in California, resulting in
more intense and prolonged droughts
punctuated by years of intense rainfall.

While average annual precipitation may
not change significantly in the next 50-75
years, it will likely come in more intense
storms and a shorter wet season. Vernon’s
historical average maximum daily
precipitation is approximately 2 inches,
but some climate models indicate it could
increase to 3 inches by the end of the
century. Moreover, the length of dry spells
could rise from an average of 159 days to
211 days due to climate change impacts,
and higher temperatures will increase
water demand due to higher evaporation
rates. The Cal-Adapt platform shows the
average yearly maximum temperature
in Vernon is 76 °F, but under a high
emissions scenario, it could reach 88 °F.

Existing Conditions
Most of Vernon’s water use is supplied by the City
through groundwater from the Central Groundwater
Basin, followed by imported and recycled water
purchased from the Central Basin Municipal Water
District (CBMWD). The California Water Service
Company and Maywood Mutual Water Company
Number 3 are the suppliers for different parts of the
city. The City has no surface water supply and does not divert stormwater for capture purposes.

Challenges
• Input from community survey results indicate high
value placed on importance of water quality, water
supply, and reliability
• Water demand in Vernon is expected to increase due
to growth of commercial/industrial activity
• The region’s drought periods are expected to be
longer, more intense, and occur with more regularity
• According to the Urban Water Management Plan,
there is an oversupply of recycled water in the
Central Groundwater Basin. However, Vernon
currently does not have adequate distribution
infrastructure in place to reach all potential recycled water customers
• Vernon has reduced its reliance on costly and
limited imported water due to its dependence
on groundwater sources. However, should there
be severe climate changes this would impact the
availability of both imported and the possibility of
ground water
Opportunities
• City provides water service at some of the lowest
rates in the region to attract and retain its commercial and industrial customers
• Vernon currently has an ample supply of
groundwater and is not dependent on imported
water as its water supply
Goals (W)
Goal W1 Achieve greater water
conservation
Goal W2 Improve resilience to droughts
Goal W3 Improve stormwater management
for flood control and groundwater recharge
Key Performance Metrics
• Gallons of water consumption per capita per day
(GPCD)
• Number of water audits completed annually for
industrial and commercial sites
• Number of tree wells and bioswales that have been
successfully installed
Aligning with State Targets and Key Regulations
Vernon has existing policies to manage its water resources, potential water shortages, and address drought. These policies are outlined in the General Plan, Water Conservation Ordinance, and Urban Water Management Plan (UWMP). They include measures such as specific watering days, limits on outdoor watering, and obligations for fixing leaks in a timely manner. The City already uses recycled water at the MGS, with potential opportunities for expanding the water recycling system in the future.

Legislation including SB X7-7, AB 1668, and SB 606 form the basis of the City’s UWMP. SB X7-7 was a major step forward in California’s water conservation efforts by requiring a 20% reduction in urban per capita water use by 2020. It laid the foundation for AB 1668 and SB 606, enacted in 2018, further expanding and refining California’s longterm water conservation framework. In 2020, the City’s per-person daily water usage was 59,814 gallons, measured in gallons per capita per day (GPCD). This average usage is less than its targeted limit of 89,809 GPCD for that year. As a result, the City successfully met its 2020 water consumption goal and is in compliance with SB X7-7 regulations.

CITY OF VERNON
2020 URBAN WATER MANAGEMENT PLAN
VOLUME 1 – FINAL REPORT
JUNE 15, 2021
Prepared by
In the past decade, most of the water used in Vernon has been for commercial and industrial purposes, followed by power generation, and the rest for residential and other uses.

VERNON’S WATER USE
City’s Water Usage
Source:

UWMP Volume 1, 2021
* The GPCD in the
UWMP is based on
a population of 100.

These numbers are
adjusted to incorporate
the current population
of 200.

City’s 2020 Consumption
5%
Residential/Other
10%
Power-generation
85%
Commercial/Industrial
0 10,000
30,000
40,000
2020 Target 2020
Consumption
20,000
Gallons Per Capita 50,000
Per Day 2020*
..

Item 11 Page 18 of 82
32 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 33 City of Vernon Environmental Sustainability Action Plan Strategies and Actions
W1-a: Identify customer interest to expand
use of recycled water.
• Support potential, future CBMWD projects
for expanding the recycling water system and
infrastructure in Vernon.
• Provide technical assistance and incentives, in
collaboration with CBMWD, to support businesses
and industries in retrofitting their systems to
accommodate recycled water use.

W1-b: Collaborate with CBMWD to expand
water conservation programs (water
audits, water fixture upgrades,
retrofits, and recycled water use).
• Identify and collaborate with CBMWD, non-profit
organizations, and educational institutions involved
in conservation efforts.
• Collaborate with CBMWD to facilitate water
efficiency upgrades for industrial and commercial
sites. Measure success by tracking the number of
conducted water audits and completed upgrades.

W1-c: Share information on regional water
conservation programs available for
residents.
• Create a dedicated section on the City’s website
for all CBMWD water conservation programs and
resources.
• Organize information into clear categories and
multiple languages, making it easy for residents to
navigate and access information.
• Collaborate with local newspapers, radio stations,
and TV channels to feature stories, interviews,
and segments about regional water conservation
initiatives.

W2-a: Promote drought-tolerant
landscaping for residential customers.
• Offer rebates or incentives for residents who
replace traditional lawns with drought-tolerant
landscapes.
• Transition to drought-tolerant and native landscaping for all City-owned public spaces.
• Create an online resource on the City website that
features tools that help residents plan, design, and
implement drought-tolerant landscapes.

W2-b: Continue to monitor water usage and
assess water conservation pricing,
especially during drought periods.
• Update Water Conservation Ordinance No. 1161
from 2009, which amended Article VI of Chapter 25
of its municipal code to enhance water conservation
efforts, to align with new information and
technologies.
• Support the implementation of the UWMP strategies
for water conservation.

W3-a: Develop a comprehensive stormwater
management plan that incorporates the
Citywide Tree Wells Project.
• Offer incentives or rebates to property and business
owners who install green infrastructure, including
tree wells and bioswales, to manage stormwater and
increase percolation into local groundwater.
• Establish clear maintenance standards for tree wells
and other green infrastructure elements.
• Identify and secure funding sources for stormwater
management projects, including grants, bonds, or
public-private partnerships.

Sustainability Co-Benefits
SOCIAL. Secures water supply for present
and future generations, enhancing community
resilience during droughts.

ECONOMIC. Decreases demand for resources,
reduces costs for water, avoids expensive
infrastructure expansions, and minimizes
economic risks during water scarcity.

ENVIRONMENTAL. Enhances water quality by
reducing runoff and pollution, ensuring clean
water sources for human consumption and
wildlife ecosystems.

Local Spotlight –
Citywide Tree Wells
The Citywide Tree Wells project involves
planting trees and managing stormwater by
installing 115 new street tree wells. These
tree wells are specifically designed to capture
runoff from the gutter and process it through a
combination of biofiltration, evapotranspiration,
and infiltration, ultimately providing the necessary
irrigation for the trees.

Tree wells helps mitigate stormwater-related
issues like flooding and pollution, protecting local
water bodies and enhancing water quality. This
project also provides benefits for heat reduction,
enhanced air quality, biodiversity support, carbon
sequestration, and urban livability.

Fiscal Considerations
Communities in southern California must continue
to plan for future drought conditions and build
local resilience, through implementation of water
conservation measures, improved stormwater
management, improved water-saving technologies,
and public awareness campaigns. Greater success of
these actions is tied to widespread implementation
and partnerships. Similarly, diversifying water sources, developing drought-resilient landscapes, and
upgrading stormwater infrastructure requires cross
collaboration and often means costlier investments.

Vernon’s ability to rely on local water supply helps to eliminate transportation costs and the issue of limited regional supplies. During periods of drought, potential for increased water costs is still of concern, which can incentivize reduced consumption, but may impact
households and businesses financially. Implementation
of water strategies increase sustainable, reliable, and long-term supply of water for all users, with benefits
from more efficient technologies, reduced costs from
reduced consumption, and enhanced community
resilience during droughts.
..

Item 11 Page 19 of 82
34 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 35 City of Vernon Environmental Sustainability Action Plan

FOOD SYSTEMS
Food systems are inextricably linked
to society and the environment. The
production, processing, transportation,
distribution, and preparation of food
involves complex systems that can
contribute to greenhouse gas emissions,
deforestation, soil degradation, habitat
destruction, and water pollution, as well
as poor human health outcomes. When
designed well, however, food systems
can support resilient ecosystems, healthy
people, and vibrant communities.

Existing Conditions
Vernon is home to numerous industrial food service
facilities, including warehousing and refrigeration,
processing, and commercial agriculture, with a
concentration of meat/poultry processing facilities.

The City has 22 cold storage facilities and 5 rendering facilities that repurpose animal by-products into feed, fertilizer, and biofuel. However, commercial food
service is limited in the City, mainly catering to the
daytime workforce. There are few markets or grocery
stores, and no farmer’s markets.

The City gathers data on various food service facilities, however, information is limited regarding food supply,
production sources, and edible food recovery. For
example, there is little information on the compliance
status of state-mandated organics recycling (Senate
Bill 1383). It is clear, however, that many companies
operating in Vernon are willing to enhance recycling
related to the food system.

Challenges
• The industrial context of the City makes local
agriculture more challenging because of space and
possible soil contamination
• The arid Southern California climate is not suitable
for many food crops, leading to more imports.
• Lack of food disposal data from Vernon businesses
makes it more difficult to identify opportunities for
food rescue and upcycling
• Global and national economies and subsidies favor
the production of foods that do not support human
health
Opportunities
• Many food businesses in proximity to other
businesses, such as renderers and mushroom
farmers, etc., could upcycle their byproducts into
edible food
• The Helping Hands Society provides a local avenue
to rescue surplus edible food and distribute it to
those in need
• The Los Angeles Food Policy Council is a local
resource for implementing sustainable and just food
systems
• The City’s health department ensures compliance
with health codes and collaborates with the South
Coast Air Quality Management District (AQMD) to
stay informed about rendering operations’ issues.

Goals (F)
Goal F1 Support a thriving regional food
economy
Goal F2 Provide safe and convenient
access to affordable, healthy, culturally
relevant food
Key Performance Metrics
• Number of local businesses participating in surplus
food upcycling
• Number of community gardens or farmer’s markets
operating within the City
Strategies and Actions
F1-a: Lead by example through City purchasing
practices.
• Update the City’s food purchasing policies to require all its departments to prioritize local production,
environmental sustainability, valued workforce,
animal welfare, and nutrition in their food purchases.
• Encourage Vernon’s large businesses and institutions
to adopt similar food purchasing policies by
providing templates, support, and publicity.

F1-b: Incentivize, support, and publicize
businesses that upcycle surplus food
products.
• Offer businesses access to training, workshops, and
technical assistance to help them integrate surplus
food upcycling practices.
• Convene a food upcycling competition such as the
“Reverse Pitch” in Austin, Texas, where businesses
pitch their materials to local entrepreneurs that can
use them as ingredients for upcycled food products.

Aligning With State Targets
The SB 1383 Local Assistance Grant Program, established in 2016, aims to reduce methane emissions and combat climate change by cutting down on organic waste disposal in California. SB 1383 set targets to reduce organic waste disposal by 50% by 2020 and 75% by 2025 and rescue at least 20% of currently disposed surplus food for consumption by 2025. The Department of Resources Recycling and Recovery (CalRecycle) administers this non-competitive grant program, funding local jurisdictions to implement SB 1383 regulations, including collection, edible food recovery, and education and outreach. To meet SB 1383 goals, the City of Vernon plans to partner with Dyrt Labs, Inc. Dyrt offers a cost-neutral composting pilot initiative that includes customized tracking software and the use of Dyrt’s proprietary composting equipment. This partnership aims to divert food waste from landfills and facilitate compliance with SB 1383 requirements. The proposed composting pilot project includes waste stream tracking software, a platform connecting businesses with service providers to manage various waste streams, residential food waste collection for 75 households, and the provision of Dyrt composters to private businesses at a discounted rate. This initiative helps businesses manage their waste effectively, contributes to the City’s compliance with SB 1383 regulations, and promotes environmental sustainability.
..

Item 11 Page 20 of 82
36 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 37 City of Vernon Environmental Sustainability Action Plan F2-a: Promote community gardens and
farmers markets.
• Promote community gardens, rooftop gardens, and
urban farms to produce fresh produce locally and
reduce the distance food travels from farm to table.
• Organize farmers’ and mobile markets with direct
access to fresh, locally grown produce in areas
convenient to Vernon’s workforce and accessible to
its residents.

F2-b: Promote food rescue and distribution. • Support and publicize Helping Hands Society to develop a broader donation network and greater
transportation and storage capabilities.
• Launch targeted awareness campaigns highlighting
the value of surplus food rescue for the local
economy, environment, and community well-being.

Sustainability Co-Benefits
SOCIAL. Increases food access and security
through diverse, local production, and
prioritizes fair labor practices, supporting
farmers and food workers with equitable wages
and improved working conditions.

ECONOMIC. Stimulates local economies,
generating jobs, and supporting small
businesses through production and distribution
support.

ENVIRONMENTAL. Decreases waste through
composting, efficient resource use, and reduced
energy consumption by emphasizing localized
production and distribution.

Fiscal Considerations
Revising land use and zoning regulations to support
sustainable, urban farming practices entail greater
administrative costs and could have high revenue
implications. However, investing in initiatives like
supporting local farmers’ markets, local food
distribution networks and food education programs
can significantly benefit the local economy at lower
costs. To encourage adopting sustainable practices,
the City could consider offering incentives or grants to local farmers and food producers, providing them with
the necessary resources to transition towards more
sustainable and environmentally friendly methods.

Local Spotlight – Smallhold
In 2022, Vernon welcomed Smallhold, LA County’s
first Certified Organic mushroom farm. Smallhold
uses indoor agriculture technologies to grow
various mushroom varieties, often at sites such
as grocery stores and restaurants where the
mushrooms will be purchased and/or consumed,
thereby reducing food transportation emissions.

Smallhold’s operations prioritize water and
energy efficiency and contribute to the circular
materials economy by utilizing sawdust waste as
a mushroom growth medium and by composting
all spent substrates. Weekly, Smallhold receives
15,000-20,000 lbs. of sterilized and inoculated
sawdust substrate blocks. Smallhold is exploring
dehydration methods to reduce food waste and
donates surplus mushrooms to the Helping Hands
Society of Los Angeles for hunger relief. They
collaborate with UC Riverside on soil remediation
and green space creation, aiming to apply these
studies in Vernon.
..

Item 11 Page 21 of 82
38 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 39 City of Vernon Environmental Sustainability Action Plan

COMMUNITY HEALTH & RESILIENCE
Sustainability and community health
are deeply interconnected and mutually
dependent. Sustainable practices
promote a healthier environment,
resource conservation, climate resilience,
and social equity, all of which contribute
to improved community health and wellbeing.

Existing Conditions
Climate change presents considerable risks to public
health and safety in Vernon, including worsening air
quality, intensified droughts, extreme weather events,
heightened flood risks, and a potential increase in
pandemics and vector-borne diseases. Vulnerable
populations, including people of color, seniors,
economically disadvantaged individuals, children,
and those with disabilities or pre-existing health
conditions, are more likely to be disproportionately
affected by these impacts. These climate-related
challenges compound the existing hardships faced by
communities with constrained financial resources and
inequitable access to stable employment, education,
healthcare, and transportation options.

Air Quality: • The pollution burden in Vernon is greater than almost all other communities in LA County (98th
percentile in the County; 88th percentile in the state) due to higher potential for exposure to pollutants
and adverse environmental conditions caused by
pollution.
• Poor air quality is due to high levels of fine particulate matter (PM 2.5) and diesel particulate matter, which
can affect the human respiratory and cardiovascular
systems.

Extreme Heat: • Excessive heat can lead to heat-related illnesses, exacerbate respiratory and cardiovascular problems,
and contribute to an increased risk of hospitalizations and fatalities. Extreme Heat Days, defined as the
number of days per year when daily maximum
temperatures rise above 97.9 °F, are forecasted to
surge from an average of 2 days up to 64 days per
year by 2100.
• Higher temperatures associated with climate change
are creating more suitable conditions that may foster
the rise and spread of vector-borne diseases, such as
Zika, dengue fever, yellow fever, West Nile Virus, and
Lyme Disease.

Opportunities
• Proximity to LA River and transit; opportunities for
active transportation
• Vernon community identified public health
improvements as a major element and co-benefit of
sustainability
• 2023 Local Hazard Mitigation Plan evaluates the
impacts of climate change on various hazards within
the City, and includes a vulnerability assessment
that identifies physical and social vulnerabilities
associated with each hazard
Goals (C)
Goal C1 Increase resilience to climate
change hazards
Goal C2 Reduce urban heat islands
Goal C3 Reduce air pollution
Key Performance Metrics
• Number of annual tree plantings • Percent of tree canopy coverage Strategies and Actions
C1-a: Develop a Community Climate Change
Adaptation Plan.
• Conduct detailed climate change vulnerability
assessment; identify key physical assets and
populations at risk.
• Identify priority actions for increasing community
resilience.

C1-b: Identify locations for community cooling
centers/resilience hubs.
• Create detailed maps highlighting high-risk areas,
considering demographics and accessibility.
• Evaluate public buildings, schools, community
centers, and libraries to identify those that could
serve as cooling or resilience hubs.
• Engage community members through surveys,
meetings, and focus groups to gather insights on
preferred locations and potential barriers to access.

Public Health Partnerships
Vernon’s Health + Wellness Center is a pilot
project presented in partnership with Wellness
Equity Alliance (WEA), to promote health and
wellness in Vernon’s business community
through quality and accessible health services.

The Health + Wellness Center provides
primary health care, family planning, mental
health, health promotion, patient education,
and other health services. Mobile services are
also available, providing onsite services for
employees that support increased productivity
for the workforce. The project also promotes
equitable access to health care services,
providing low- and no-cost options for
patients and clinical and counseling services
regardless of insurance or immigration status.

The project expands opportunities for public
health to Vernon’s 50,000+ employees and
business community.

Insurance + Patient Costs
Insurance enrollment assistance
available for all patients
Clinical and counseling services will
be provided regardless of patient’s
insurance or immigration status
No-cost and low-cost options
available
Partnerships for a
Healthy
Workforce
The City of Vernon, in partnership with WEA,
is proud to present the Vernon Health +
Wellness Center, a pilot project currently
funded by the City and various grant
resources. Working together, the City and
business community can promote health and
wellness, increase productivity, empower
whole care, and improve the overall
prosperity for the 50,000 people employed
by Vernon businesses. It is our mission to
ensure that quality health services are widely
accessible, convenient, and comprehensive.

Join us in our pursuit of this goal!
Services Offered
Primary Health Care
Wellness and Preventive Screenings
Acute Illness Testing and Treatment
Vaccinations - COVID-19, Flu + More
Family Planning and Sexual Health
Mental Health
Substance Use Disorder
Health Promotion and Patient Education
Vernon Health + Wellness Center
Clinical and counseling services
conveniently located in the heart of
Vernon, behind City Hall
Vernon Health Mobile Services vans
are available to provide efficient
onsite services to employees,
decreasing downtime and increasing
productivity – our Wellness on Wheels
(WoW) services are convenient for
your workforce.

Care available in English and Spanish
and other translation services offered
Appointments easily made online via
QR code and at vernonhealth.org.

Founded on the Public Health Principle of
“Meeting People Where They Are”

INTRODUCING
Challenges
• Quantity and proximity of stationary and mobile
sources of pollution
• Low urban tree canopy/forestry • Low active transportation routes/opportunities for active commuting for employers
..

Item 11 Page 22 of 82
40 Sustainability Sectors, Goals, and Strategies Sustainability Sectors, Goals, and Strategies 41 City of Vernon Environmental Sustainability Action Plan C3-a: Prioritize implementation of sector
actions that result in GHG reductions
(those with icon).

Sustainability Co-Benefits
SOCIAL. Enables social well-being, provides
cleaner environments, reduces respiratory
diseases, and offers safe spaces for physical
activity.

ECONOMIC. Improves preparedness and
adaptability, reduces the impact of climaterelated emergencies, protects lives, and decreases economic losses.

ENVIRONMENTAL. Captures pollutants,
reduces heat island effects, and enhances air
quality. Urban greening also boosts biodiversity,
supporting urban ecosystems and habitats.

Fiscal Considerations
Development of strategies for climate change
adaptation, cooling centers, early warning systems,
and public health monitoring often require
established partners and resources. Reducing urban
heat islands and air pollution further requires multisector investments as these efforts involve tree canopy expansion, cool roofs, renewable energy
use, transportation enhancements, waste reduction,
and water conservation initiatives. Monitoring for
vector-borne diseases in particular requires close
collaboration with healthcare institutions, educational campaigns, and data-sharing agreements.

Implementation of Community Health and Resilience
strategies should prioritize local engagement with
business- and community leaders to ensure funding
will benefit areas where it is needed the most. Through this process, Vernon can measure costs and savings
for expected benefits, such as reductions in healthcare costs, missed or skipped work and school days,
increased productivity, and prevented losses during
emergencies or disasters.

C1-c: Improve early warning and communication
systems for climate emergencies (extreme
heat and precipitation events, wildfire
smoke, etc.).
• Implement a multi-channel communication system
that sends alerts via text messages, emails, mobile
apps, social media, and sirens to reach a wide range
of residents in real-time.
• Translate alert messages into multiple languages to
ensure inclusivity and accessibility.

C1-d: Monitor vector-borne diseases through
public health collaborations.
• Establish agreements with healthcare institutions
to share relevant data for comprehensive disease
monitoring.
• Launch educational campaigns to inform residents
about vector-borne diseases, their prevention,
symptoms, and available healthcare resources.

C2-a: Increase urban tree canopy. • Update the Urban Tree Planting Assessment every 5 years.
• Focus on key transportation corridors that connect
public transit to key employers and destinations
within the City.
• Partner with local and regional organizations such
as TreePeople to build local awareness for tree care
and maintenance, for departmental staff, businesses,
and homeowners who can help care for right-of-way
plantings.

C2-b: Increase the use of cool roofs and
pavements.
• Implement building codes or ordinances
that mandate the installation of cool roofs for new
constructions and major renovations.
• Offer financial incentives, tax breaks, or rebates to property owners who install cool roofs or pavements.
• Conduct awareness campaigns to educate
homeowners, builders, and businesses about the
benefits of cool roofs and pavements.

Local Spotlight –
Urban Tree Program
In Vernon, the City’s only Census tract currently
has the lowest tree canopy cover (2%) in all of Los
Angeles County. Enhancing Vernon’s tree canopy is
a critical step toward mitigating the environmental
challenges the City faces, which is why Loyola
Marymount University, TreePeople, and the
Gateway Cities Council of Governments partnered
with the City of Vernon to prioritize communitybased tree planting. This collaboration involved input from residents, businesses, and stakeholders
to identify key tree benefits and create a priority
map within Vernon.

Urban forestry is one strategy to increase a city’s
resilience. In addition to reducing the urban
heat island effect, urban trees can help prevent
flooding and runoff and remove pollutants before
water enters rivers and oceans. Trees also filter air
pollutants, improving air quality and producing
public health benefits.
..

Item 11 Page 23 of 82
City of Vernon Environmental Sustainability Action Plan 42 Implementation Implementation 43
Implementation
City of Vernon Environmental Sustainability Action Plan CHAPTER 3
Management
The City’s Health and Environmental Control
Department will lead the implementation of the ESAP.

However, specific strategies and actions may fall under the jurisdiction of other City departments, including
Public Utilities and Public Works. Implementation
progress will be guided by the Green Vernon
Commission (GVC), an established committee
with representation from the business, labor, and
environmental communities to champion sustainability
throughout the City, will provide ongoing guidance
and support for the implementation of the ESAP, and
identify new opportunities for sustainability.

Monitoring and Reporting
The City is committed to tracking the ESAP’s
implementation progress and reporting to the GVC.

The ESAP includes actions that were identified to
improve sustainability throughout Vernon. The GVC will
be charged with evaluating and prioritizing the actions based on a set of evaluation criteria that will include, at minimum, the cost impacts, feasibility, and co-benefits.

This ESAP is a living document. It is expected that, over time, City, business, and community priorities may shift, new legislation will be introduced, and environmental
conditions will change. Funding sources, regulations,
and City staff and partnering organizations will also
evolve. To ensure the ESAP stays relevant, progress will be monitored regularly, on an annual basis, to evaluate the effectiveness of sustainability goals and strategies, and to make course corrections where needed. The
ESAP incorporates performance metrics that establish
measurable criteria for its goals on an annual basis,
unless otherwise specified.

Funding
With respect to funding, it is beyond the scope of this ESAP to develop a detailed cost-benefit analysis of
every action. Actions using the City’s general fund will go through the standard City Council approval process,
including a financial impact analysis and inclusion in
the City budget. As a part of its annual budget process, the City may appropriate funding from its general
fund or make changes in its fee schedules, utility rates, and other sources as needed to support funding the
implementation of the sustainability measures. With
an adopted ESAP, the City’s ability to seek federal and state grants will be enhanced.
..

Item 11 Page 24 of 82
City of Vernon Environmental Sustainability Action Plan 44 Implementation Implementation 45
Implementation Framework
The table below summarizes the goals and strategies
from Chapter 2 – Sustainability Sectors, Goals, and
Strategies. To facilitate successful implementation, each strategy as described in Chapter 2 includes one or
more performance metrics to assist the City in tracking and monitoring progress on a periodic basis. Each
sustainability strategy is accompanied by a suggested
timeframe for implementation, a responsible lead City
department, and targeted implementation partners,
as described below. Chapter 2 also includes a list of
recommended implementation actions under each
strategy that will be tracked for completion by the Lead Department.
• Timeframe: Identifies the target timeframe for the
strategy to be implemented. For the sustainability
strategies, these are designated as Near Term
(2024–2027), Mid Term (2027–2035), and Long
Term (after 2035). Some strategies build on existing
and continuous efforts, and are noted as Ongoing.

Funding availability may dictate when strategies are
actually completed.
• Lead Department: Identifies the City department(s)
responsible for implementing the strategy. In
some cases, there may be joint implementation
responsibility across departments.
• Potential Partners: Identifies the City department(s) that could potentially work with the Lead Department
to implement the strategies and actions.

Strategy Timeframe Lead Department Potential Partners
Greenhouse Gas Emissions, Goal G1: Reduce community GHG emissions in alignment with state targets G1-a: Develop a detailed climate action plan for
reducing emissions throughout the community and
tracking progress towards targets that align with state mandates.

Mid term
2027-2035
Public Utilities Public Works
Energy, Goal E1: Transition to clean, renewable energy sources: 60% by 2030, 90% by 2035, 95% by 2040, and 100% by 2045
E1-a: Procure and deliver more renewable electricity
to the grid.

Mid term
2027-2035 Public Utilities
E1-b: Enable businesses and residents to adopt
carbon free distributed energy resources.

Near term
2024-2027 Public Utilities Public Works
Energy, Goal E2: Improve energy efficiency of new and existing buildings throughout the community E2-a: Encourage building electrification and energy
efficiency.

Near term
2024-2027 Public Utilities Public Works
E2-b: Develop community partnerships to evaluate
deployment of new technologies and infrastructure to
reduce energy-related emissions.

Near term
2024-2027 Public Utilities Public Works
Energy, Goal E3: Increase community energy resilience
E3-a: Promote the adoption of microgrid
technologies.

Mid term
2027-2035 Public Utilities Public Works
Transportation, Goal T1: Reduce traffic congestion and vehicle emissions T1-a: Reduce truck emissions of criteria air pollutants. Near term 2024-2027 Public Works
Health and
Environmental
Control
T1-b: Coordinate with local businesses and
developers to reduce on-road VMT.

Mid term
2027-2035 Public Works
Health and
Environmental
Control
Strategy Timeframe Lead Department Potential Partners
Transportation, Goal T2: Increase the use of ZEVs throughout the community T2-a: Expand and maintain EV charging infrastructure. Near term 2024-2027 Public Works
Transportation, Goal T3: Create a safe, reliable, and efficient network for walking, biking, public transit, and new forms of mobility
T3-a: Promote active transportation and transit. Near term 2024-2027 Public Works
Materials and Waste, Goal M1: Continue to Grow Vernon’s Circular Economy M1-a: Support waste prevention through product and
packaging redesign.

Near term
2024-2027
Health and
Environmental
Control
M1-b: Support local materials exchange. Near term
2024-2027
Health and
Environmental
Control
M1-c: Improve information and resources on City
webpage.

Near term
2024-2027
Health and
Environmental
Control
City Administration,
City Clerk
M1-d: Align the City’s procurement processes with the
requirements of SB 1383 to minimize toxics and waste,
and incentivize local businesses to do the same.

Near term
2024-2027
Health and
Environmental
Control
Materials and Waste, Goal M2: Maximize the effectiveness of waste management systems M2-a: Maximize benefits of the waste diversion
system.

Near term
2024-2027
Health and
Environmental
Control
Materials and Waste, Goal M3: Reduce 75% of organic waste disposed in landfills by 2025 M3-a: Increase Reuse and Recycling of materials and
organics.

Near term
2024-2027
Health and
Environmental
Control
Water, Goal W1: Achieve greater water conservation
W1-a: Identify customer interest to expand use of
recycled water.

Mid term
2027-2035 Public Utilities
Health and
Environmental
Control
W1-b: Collaborate with CBMWD to expand water
conservation programs (water audits, water fixture
upgrades, retrofits, and recycled water use).

Near term
2024-2027 Public Utilities Public Works
W1-c: Share information on regional water
conservation programs available for residents.

Near term
2024-2027 Public Utilities
Health and
Environmental
Control
Water, Goal W2: Improve resilience to droughts
W2-a: Promote drought-tolerant landscaping for
residential customers.

Near term
2024-2027 Public Works Public Utilities
W2-b: Continue to monitor water usage and assess
water conservation pricing, especially during drought
periods.

Ongoing Public Utilities
..

Item 11 Page 25 of 82
City of Vernon Environmental Sustainability Action Plan 46 Implementation Implementation 47
Strategy Timeframe Lead Department Potential Partners
Water, Goal W3: Improve stormwater management for flood control and groundwater recharge W3-a: Develop a comprehensive stormwater
management plan that incorporates the Citywide Tree
Wells Project.

Near term
2024-2027 Public Works
Health and
Environmental
Control
Food Systems, Goal F1: Support a thriving regional food economy F1-a: Lead by example through City purchasing
practices.

Near term
2024-2027 Finance Department All Departments
F1-b: Incentivize, support, and publicize businesses
that upcycle surplus food products.

Near term
2024-2027
Health and
Environmental
Control
Food Systems, Goal F2: Provide safe and convenient access to affordable, healthy, culturally relevant food F2-a: Promote community gardens and farmers
markets.

Near term
2024-2027
Health and
Environmental
Control
F2-b: Promote food rescue and distribution. Near term
2024-2027
Health and
Environmental
Control
Community Health & Resilience, Goal C1: Increase resilience to climate change hazards C1-a: Develop a Community Climate Change
Adaptation Plan.

Mid-term
2024-2027 Public Works
Health and
Environmental
Control
C1-b: Identify locations for community cooling
centers/resilience hubs.

Near term
2024-2027
Health and
Environmental
Control
Public Works
C1-c: Improve early warning and communication
systems for climate emergencies (extreme heat and
precipitation events, wildfire smoke, etc.).

Near term
2024-2027
Health and
Environmental
Control
Public Works, Police
Department
C1-d: Monitor vector-borne diseases through public
health collaborations.

Near term
2024-2027
Health and
Environmental
Control
Public Works
Community Health & Resilience, Goal C2: Reduce urban heat islands C2-a: Increase urban tree canopy. Near term
2024-2027 Public Works
C2-b: Increase the use of cool roofs and pavements. Near term 2024-2027 Public Works
Community Health & Resilience, Goal C3: Reduce air pollution C3-a: Prioritize implementation of sector actions that
result in GHG reductions (those with icon).

Near term
2024-2027
Health and
Environmental
Control
Public Utilities, Public
Works
Potential Funding Opportunities
For some strategies and actions, successful
implementation will require outside funding sources
in addition to a commitment of City resources. There
are a variety of available and active funding sources
that can support the implementation of sustainability
strategies identified in this ESAP. The table below
provides a list of known, potential funding sources
and identifies the relevant sustainability sectors that could benefit. Programs and funding sources for
Strategy Timeframe Lead Department
Caltrans Sustainability
Planning Grant: Climate
Adaptation Planning
Funds for identifying transportation-related climate vulnerabilities through climate action plans and other projects related to climate adaptation and transportation infrastructure.

Transportation,
GHGs
OPR Adaptation
Planning Grant Program
Funding made available to help fill local, regional, and tribal planning needs especially as they related to responding to climate impacts.

Aims to assist communities in implementing plans that build resilience and reduce future risks.

Energy, Water,
Community Health
and Resilience
OPR Regional
Resilience Planning
and Implementation
Grant Program
Support for regional projects and plans that improve regional climate resilience.

Community Health
and Resilience
SGC Community
Resilience Centers
Grant Program
Funding for neighborhood-level resilience centers creating shelters and resources during climate emergencies and providing year-round community strengthening services.

Energy, Community
Health and
Resilience
OPR Community
Resilience and Heat
Grant Program
Program aims to expand projects that mitigate the impact of heat including heat action plans, shade structures, and cooling projects.

Community Health
and Resilience
SoCalGas Climate
Adaptation and
Resiliency Grant
Assists local cities in becoming more resilient to climate hazards, improving climate adaptation, and mitigating the impacts of hazards.

Water, Community
Health and
Resilience
FEMA Building
Resilient Infrastructure
and Communities
(BRIC) Grant
Provides annual grants for hazard mitigation planning and mitigation projects to build community capacity and capability.

Community Health
and Resilience
EPA Climate Pollution
Reduction Grant (CPRG)
Provides funding to develop and implement plans to reduce greenhouse gas and other emissions.

GHGs, Materials
and Waste
SCAG Sustainable
Communities Program
Technical assistance program to strengthen partnerships with local agencies to improve transportation and land use decisions Transportation,
GHGs
increasing sustainability across sectors are developing rapidly and may change substantially from year to
year. This includes but is not limited to federal sources, various grant programs that fall under the umbrella
of California Climate Investments (funded from Capand-Trade revenues), and organizations like Southern California Regional Energy Network (SoCalREN) that
provide financial assistance for energy efficiency
improvements to residents, businesses, and public
agencies.
..

Item 11 Page 26 of 82
City of Vernon Environmental Sustainability Action Plan 48 Implementation Implementation 49
Strategy Timeframe Lead Department
Cal EPA Greenhouse
Gas Reduction Fund
Provides private capital for clean energy and climate projects that reduce air pollution
GHGs, Energy
California Natural
Resources Agency
Urban Greening
Grant Program
Funds projects that reduce GHG emissions by sequestering carbon, decreasing energy consumption, and reducing VMT.

Transportation,
GHGs, Energy
California Natural
Resources Agency
Urban Green
Infrastructure Program
Funding for multi-benefit green infrastructure investments in or benefiting disadvantaged communities.

GHG emissions,
extreme heat
Federal Infrastructure
Investment and
Jobs Act
The Federal Infrastructure Investment and Jobs Act, passed in 2021, authorizes approximately $550 billion in new federal investment in America’s transportation, communication, and water infrastructure, with much of the funding geared toward the clean energy transition and increasing resilience to climate change. The legislation includes the following: • $39 billion of new investment to modernize transit and improve accessibility for the elderly and people with disabilities. • $7.5 billion to build a national network of electric vehicle chargers. • $73 billion for power infrastructure and clean energy transmission. • $110 billion for roads, bridges, and other major projects. • $11 billion in transportation safety programs. • $39 billion in transit modernization and improved accessibility.

Transportation,
Energy
Greenhouse Gas
Reduction Fund
The Inflation Reduction Act amended the Clean Air Act to create a new program: the Greenhouse Gas Reduction Fund. This first-of-itskind program will provide competitive grants to mobilize financing and leverage private capital for clean energy and climate projects that reduce GHG emissions—with an emphasis on projects that benefit low-income and disadvantaged communities—and further the BidenHarris Administration’s commitment to environmental justice. The Greenhouse Gas Reduction Fund provides $27 billion to U.S. EPA for expenditure until September 30, 2024. This includes: • $7 billion for competitive grants to enable low-income and disadvantaged communities to deploy or benefit from zeroemission technologies, including distributed technologies on residential rooftops;
• Nearly $12 billion for competitive grants to eligible entities to provide financial and technical assistance to projects that reduce or avoid GHG emissions; and
• $8 billion for competitive grants to eligible entities to provide financial and technical assistance to projects that reduce or avoid GHG emissions in low-income and disadvantaged communities.

GHG
Strategy Timeframe Lead Department
Resilient and Efficient
Codes Implementation
$225 million for the Infrastructure Investment and Jobs Act to advance state and local jurisdiction efficiency and resilience of building energy codes, as well as provide long-term sustainability of measures and savings, and address equity, energy, environmental justice, and resilience priorities. Funding is appropriated for “eligible entities to enable sustained cost-effective implementation of updated building energy codes” through a competitive grant process over five years (Fiscal Years 2022 through 2026). Awardees eligible for this funding must include a relevant state agency, and priority will be given to teams that include strategic partnerships, such as a local building code agency, codes and standards developers, associations of builders and design and construction professionals, and many others. Projects must be tied to an updated building energy code, which includes any amendment or code update resulting in increased energy efficiency as compared to the previously adopted code.

Energy
Pollution Prevention
(P2) Grant Program
P2 grants provide technical assistance to businesses to help them develop and adopt source reduction practices (also known as “pollution prevention” or “P2”). “P2” means reducing or eliminating pollutants from entering any waste stream or otherwise released into the environment prior to recycling, treatment, or disposal.

Waste and Materials
WaterSense WaterSense is a voluntary partnership program sponsored by the U.S.

EPA, and is both a label for water-efficient products and a resource for helping residents and businesses save water.

Water
Safe Routes to
Schools
Safe Routes to Schools is an international movement focused on increasing the number of children who walk or bike to school by funding projects that remove barriers to doing so. These barriers include a lack of infrastructure and non-infrastructure projects, safety, and limited programs that promote walking and bicycling. In California, two separate Safe Routes to School programs are available at both the state and federal levels, and both programs fund qualifying infrastructure projects.

Transportation,
Community Health
and Resilience
..

Item 11 Page 27 of 82
Environmental Sustainability Action Plan
References 51
City of Vernon
50 Acronyms and Abbreviations
References
City of Vernon Environmental Sustainability Action Plan Cal-Adapt. 2021. Local Climate Change Snapshot
for Vernon. Selected indicators for temperature and
precipitation under high emissions scenario (RCP 8.5).

Available: https://cal-adapt.org/tools/local-climatechange-snapshot.

California Department of Resources Recycling
and Recovery (CalRecycle). 2022. Solid Waste
Characterization. Exported data for commercial waste
streams by business groups and material type for the
City of Vernon. Available: https://www2.calrecycle.
ca.gov/WasteCharacterization/.

California Office of Environmental Health Hazard
Assessment (OEHHA). 2021. CalEnviroScreen 4.0.

Available: https://oehha.ca.gov/calenviroscreen.

Central Basin Municipal Water District (CBMWD). 2020.

Urban Water Management Plan. June 2021. Available:
https://centralbasin.hosted.civiclive.com/common/
pages/DisplayFile.aspx?itemId=17832141.

Center for Good Food Purchasing. 2023. October 2023.

Available: https://goodfoodpurchasing.org/
City of Vernon. 2009. Ordinance No. 1161.

Executed October 27, 2009. Available:
https://www.cityofvernon.org/home/
showpublisheddocument/670/637619845786600000.
———. 2021a. 2020 Urban Water Management Plan
(UWMP), Volume 1 – Final Report. June 15, 2021.
———. 2021b. 2021 Solid Waste Tonnage Report.
———. 2022a. Greenhouse Gas Inventory Management
Plan. September 2007. Updated July 2022. Jacobs
Engineering Group Inc.
———. 2022b. Local Hazard Mitigation Plan (LHMP), Public Review Draft. September 6, 2022. ———. 2022c. Rendering
Operations. Available: https://www.cityofvernon.org/
government/city-administration/rendering.

City of Vernon Public Utilities (VPU). 2018. Integrated Resource Plan. November 20, 2018.
———. 2022. Wildfire Mitigation Plan. Version

3.0. Effective Date: 8/16/2022. Available:
https://www.cityofvernon.org/home/
showpublisheddocument/2683/637964368963930000.
———. 2023. Draft Integrated Resource Plan (IRP).

County of Los Angeles (LA County). 2019. OurCounty,
Los Angeles Countywide Sustainability Plan. Available:
https://ourcountyla.lacounty.gov/wp-content/
uploads/2019/07/OurCounty-Final-Plan.pdf.

FEMA. 2021. National Flood Hazard Layer (NFHL) Status.

Available: https://www.floodmaps.fema.gov/NFHL/
status.shtml.
..

Item 11 Page 28 of 82
City of Vernon
52 References References 53
Gateway Cities Council of Governments (GCCOG).
2018. Climate Action Planning Framework. Available:
https://www.gatewaycog.org/initiatives-and-projects/
air-quality/climate-action-planning-framework.

Los Angeles County Metropolitan Transportation
Authority (Metro). 2019. Conceptual Design
Report, LA River Path. September 2019. Available:
https://www.dropbox.com/sh/3aog0rbm3jndazm/
AABOoA9Ft7PC9NuzddM82Bv7a/Reports/LA%20
River%20Path%20Conceptual%20Design%20
Report?dl=0&preview=190912_LAR_Concept_Design_
Report_Final.pdf&subfolder_nav_tracking=1.

Loyola Marymount University, Center for Urban
Resilience (LMU CURes). 2022. Final Report, City of
Vernon Tree Canopy Prioritization. September 2022.

Available: https://www.gatewaycog.org/media/
userfiles/subsite_9/files/urban_tree/Vernon%20
Tree%20Canopy%20Prioritization%20Final%20Report.
pdf.

National Integrated Drought Information System
(NIDIS). 2022. Drought Conditions for Los Angeles
County. November 15, 2022. Available: https://www.
drought.gov/states/California/county/Los%20Angeles.

Open Charge Map. 2022. Open Charge Map for
Vernon, California, United States. Available: https://
openchargemap.org/site. Reimagine Vernon. 2022.

About the Westside Specific Plan. Available: https://
www.reimaginevernon.com/about.

South Coast Air Quality Management District (AQMD).
2022a. Press Release: Rendering Facility in Vernon
Ordered to Shut Down for Failing to Comply with
Permit Requirements and Reduce Odors. September
30, 2022. Available: http://www.aqmd.gov/docs/
default-source/news-archive/2022/baker-oasep30-2022.pdf?sfvrsn=9. ———. 2022b. AB 617 Community Air Initiatives.

Community Emissions Reduction Plan for AB 617
communities of East Los Angeles/Boyle Heights/West
Commerce (2019) and Southeast Los Angeles (2020).

Available: http://www.aqmd.gov/nav/about/initiatives/
environmental-justice/ab617-134.

Southern California Association of Governments
(SCAG). 2020. Southern California Climate Adaptation
Planning Guide. October 2020. Available: https://
scag.ca.gov/sites/main/files/file-attachments/
socaladaptationplanningguide_oct2020_0.
pdf?1619029039. United States Census Bureau. 2020.

American Community Survey. Available: https://data.
census.gov/.

Vernon Chamber of Commerce. 2022. Vernon,
An Economic Engine. Available: https://www.
vernonchamber.org/about-vernon/an-economicengine/.
..

Item 11 Page 29 of 82
Appendix A:

Outreach
Memorandum
..

Item 11 Page 30 of 82
October 18, 2023
Freddie Agyin, City of Vernon
Lisa Umeda
Jeff Caton, Stephanie Cadena, and Larry Kass, Environmental Science Associates Environmental Sustainability Action Plan – Outreach Memorandum Summary
This memorandum presents the findings and highlights from outreach and engagement activities conducted for the Environmental Sustainability Action Plan (Sustainability Plan or ESAP) for the City of Vernon (City) under contract Task B.5, Outreach Memorandum. This includes the top priorities, concerns, and goals that the community shared with the project team through various modes: • Virtual meetings and workshops with the Steering Committee • Online survey for Vernon community members, including City staff, businesses and employees, and residents
• One-on-one meetings with key businesses and business leaders in the community, identified in coordination with City staff
Meetings and Workshops (November – June 2023)
Steering Committee Meeting (November 2023)
In November 2023, the City organized a Steering Committee of staff from various departments to meet with the project team and provide guidance on the development of the Sustainability Plan.

The first meeting of the Steering Committee was held virtually on November 3, 2023 and included 12 members, shown in the table below. ..

Item 11 Page 31 of 82
O
utreachMemorandum
Name Agency/Department
City of Vernon Steering Committee
Diana Figueroa City of Vernon, Administration
Michael A. Earl City of Vernon, Human Resources
Lilia Hernandez City of Vernon, Administration
Zaynah Moussa City of Vernon, Administration
Nicole Helms City of Vernon, Environmental Health and Safety Lisa Pope City of Vernon, Administration
Scott Williams City of Vernon, Finance
Daniel Wall City of Vernon, Public Works
Freddie Agyin City of Vernon, Environmental Health and Safety Daniel Suggs City of Vernon, Environmental Health and Safety Ron Daerr Vernon Green Commission
Marisa Olguin Vernon Chamber of Commerce
Steering Committee
Participants:
12 Consultants
Jeff Caton Environmental Science Associates
Stephanie Cadena Environmental Science Associates
Vanessa Ramirez Environmental Science Associates
Larry Kass Environmental Science Associates
Miguel Nunez Fehr and Peers
Consultant Participants:5
The meeting was held to present the project to the Steering Committee and review the first task for drafting the Existing Conditions of the community by sector. During the meeting, participants introduced themselves by sharing their names, agencies, and roles. They also discussed the sustainability issues they considered most important for the City to address. A main concern raised by many participants was climate change, which they identified as the most significant, and global issue to tackle. They emphasized that addressing climate change is closely intertwined with, and can positively affect all other areas of sustainability. Another major concern identified was transportation, specifically truck emissions and improvements in public transit. Fiscal sustainability was also identified as a concern, as it is necessary for the City to have the resources for program development and implementation. Other issues of high concern included: • Waste management, especially industrial waste and recycling. ..

Item 11 Page 32 of 82
O
utreachMemorandum
• Water usage, conservation, sustainable practices like greywater systems, and reducing reliance on imported water.
• Air quality and pollution, particularly exposure to toxins in the air and water. • Energy efficiency. • Greenhouse gas emissions related to traffic and transportation. • The origin of the food supply.

The project team stressed that all the identified sustainability issues are interconnected with climate change.

Green Vernon Commission Meeting (December 2023)
The project team met with the Green Vernon Commission (GVC) via a virtual meeting on December 21, 2022, at 3:30 pm to present an overview of the Sustainability Plan project and the current tasks, including the Existing Conditions Assessment and preparation for Outreach and Engagement activities. The meeting covered the findings of the existing conditions assessment, including climate change, and strategies for upcoming outreach such as for a virtual survey, and priority sustainability sectors identified from the first Steering Committee meeting.

The GVC provided recommendations for the project team, areas of priority to address within the Sustainability Plan: • Consider jobs and local economy/businesses • Consider air quality and pollution regulations • Increase green public spaces • Identify funding available from grants • Identify cost-effective strategies Steering Committee Meeting (January 2023)
The City held a second virtual meeting of the Steering Committee on January 19, 2023, at 2 pm to discuss outreach and engagement activities, and specifically the preparation of a virtual survey for Vernon community members. There were 12 Steering Committee members in attendance, as shown in the table below.

Name Agency/Department
City of Vernon Steering Committee
Diana Figueroa City of Vernon, Administration
..

Item 11 Page 33 of 82
O
utreachMemorandum
Cathy Brown Green Vernon Commission
Michael A. Earl City of Vernon, Human Resources
Lilia Hernandez City of Vernon, Administration
Ramzi Raufdeen City of Vernon
Lisa Umeda City of Vernon, City Clerk
Robert Sousa City of Vernon, Police Department
Scott Williams City of Vernon, Finance
Daniel Wall City of Vernon, Public Works
Freddie Agyin City of Vernon, Environmental Health and Safety Marisa Olguin Vernon Chamber of Commerce
Sergio Canales City of Vernon
Steering Committee
Participants:
12 Consultants
Jeff Caton Environmental Science Associates
Stephanie Cadena Environmental Science Associates
Vanessa Ramirez Environmental Science Associates
Larry Kass Environmental Science Associates
Consultant Participants:4
During the meeting, participants discussed the logistics and characteristics of the survey, such as the survey’s target audience, timing, distribution strategy, survey focus, distribution methods, stakeholder inclusion, and the project team’s involvement.

The Steering Committee recommended that the survey be directed primarily towards businesses, employees, and residents. The aim was to reach people who live and work in Vernon. Multiple avenues were explored to maximize response rates. It was suggested to translate the survey into Korean, Chinese, and Spanish to cater to Vernon’s diverse audience. While the survey initially focused on greenhouse gas (GHG) emissions, it was suggested to broaden its scope to highlight resource sustainability and other equally important sectors to those living and working in Vernon.

Sustainability Plan Workshop City Staff (June 2023)
The Vernon Sustainability Action Plan Workshop was held on June 8, 2023, at 2 pm. The attendees consisted of 13 Steering Committee participants, shown in the table below.

Name Agency/Department
City of Vernon Steering Committee
..

Item 11 Page 34 of 82
O
utreachMemorandum
Diana Figueroa City of Vernon, Administration
Michael A. Earl City of Vernon, Human Resources
Lisa Umeda City of Vernon
Lisa Pope City of Vernon, City Clerk
Robert Sousa City of Vernon, Police Department
Brandon Gray City of Vernon, Police Department
Daniel Wall City of Vernon, Public Works
Freddie Agyin City of Vernon, Environmental Health and Safety Lisette Grizzelle City of Vernon
Angela Kimmey City of Vernon, Deputy City Admin
Zaynah Moussa City of Vernon, City Attorney
Margie Otto City of Vernon, Utility
Ernesto Smith City of Vernon
Steering Committee
Participants:
13 Consultants
Jeff Caton Environmental Science Associates
Stephanie Cadena Environmental Science Associates
Vanessa Ramirez Environmental Science Associates
Larry Kass Environmental Science Associates
Consultant Participants:4
The meeting covered significant topics related to greenhouse gas emissions, energy, utilities, food systems, materials and waste, public health and safety, water, and transportation. The team shared candidate goals and strategies across sectors for the Sustainability Plan, including information on the challenges and opportunities within Vernon that supported the strategies.

City staff provided additional information and recommendations for the project team to connect the strategies to the City’s existing programs and projects, including: • Transition to renewable energy and electrification, • Replacing natural gas usage, • Use of materials exchange platforms, • Analysis of existing and potential urban tree canopy, and • Stormwater management techniques. ..

Item 11 Page 35 of 82
O
utreachMemorandum
Community Survey (May 2023)
The project team prepared the City of Vernon's Sustainability Survey in coordination with City staff and with input from the Steering Committee, and provide in English, Spanish, Korean, and Simplified Chinese. The survey was distributed to Vernon City staff, businesses and employers, and residents with the goal of capturing a wide array of responses from Vernon’s community that would help prioritize development of sustainability strategies within the ESAP. The survey was intended to help reach other audiences outside of the Steering Committee and one-on-one meetings with businesses, to ensure the Sustainability Plan accurately reflected the priorities of those who live and work in Vernon. The survey was open to the public from May 2, 2023 through May 23, 2023, and distributed via email and hosted on the City’s webpage.

The survey received 245 responses from Vernon community members. The survey results provided valuable information, indicating three important areas that respondents wanted the City to focus on for sustainability:

1. Water (e.g., conservation, rainwater capture, water recycling, greywater) (25.6%)

2. Helping businesses/industries be more sustainable and resource-efficient (24.8%)

3. Climate resiliency (e.g., reducing heat islands with green space, trees, etc.; providing cooling centers) (15.5%)
Additionally, the survey shed light on the top three issues participants are most concerned with:

4. Drinking water quality (70.16%)

5. Utility cost (70.16%)

6. Air pollution (68.6%)
..

Item 11 Page 36 of 82
O
utreachMemorandum
One-on-One Engagement with Vernon Businesses
(December 2022 – July 2023)
SmallHold
Smallhold, the first Certified Organic mushroom farm in LA County, prioritizes sustainability with a mission to enhance agriculture’s impact on the environment and on human health.

Smallhold’s operations maximize water and energy efficiency and contribute to the circular materials economy by using sawdust waste for its mushroom-growing substrate and composting 100% of spent substrate. Smallhold’s Vernon site receives 15-20K lbs. weekly of sawdust substrate blocks that have been sterilized and inoculated with mushroom spores. Smallhold is exploring dehydration methods to extend shelf life and reduce food waste. They currently donate surplus mushrooms to the Helping Hands Society of Los Angeles for hunger relief. Smallhold collaborates with UC Riverside on soil remediation and green space creation and hopes to help put these studies into practice in Vernon.

Crown Poly
Crown Poly, founded in Los Angeles in 1991, produces film plastic and bags for home and commercial uses. Crown Poly’s sustainability practices include using shrimp shells to make plastic adhesive, local sourcing of pallets, inks and corrugated cardboard, and sourcing recycled plastic feedstock, including recovered ocean plastics. To produce home-compostable bags, Crown Poly imports a compostable bioplastic from Europe. Crown Poly donates misprinted and surplus bags to charities. Crown Poly reduces its transportation footprint by recruiting and hiring employees from within a 30-mile radius of the Vernon plant (10 miles for production staff) and by sponsoring employee carpooling and free electric vehicle charging.

Strategic Materials Inc.

Strategic Materials Inc. (SMI)’s Vernon facility processes glass-rich materials from recycling programs and from industry into color-separated glass cullet for new glass products. Batteries recovered from the incoming feedstock are sent to local processors for further sorting and then extraction of valuable metals. The company also recycles pallets, cardboard, and ferrous metals.

To save energy, the plant uses LED lighting. The facility employs 30-35 staff, offering“second chance” employment for individuals who have been in the criminal justice system. SMI prioritizes bringing more women into its workforce, running a forum called “Breaking The Glass Ceiling” to highlight its female employee’s achievements and to support women’s career advancement. SMI provides employees with refillable water bottles and bottle-filling stations and runs a “Glass Warriors” initiative to promote employee environmental literacy and action, both professionally and personally.

Golden West Foods, Inc.

Golden West Food Groups (GWFG) is a bulk supplier of raw, frozen, and prepared foods for retail, commercial and institutional use. Since 2012, GWFG has been reporting on its own sustainability performance, taking into account its use of materials and energy sources. GWFG has implemented several practices to keep its material recycling loop close to home. It sends its ..

Item 11 Page 37 of 82
O
utreachMemorandum
used fats and oils to a local renderer for processing into biodiesel, which it then purchases to fuel its own truck fleet. It also specifies the use of 50% minimum recycled content in its paperboard products, and sources these products from a local processor which uses GWFG’s own recyclable paper and cardboard as feedstock. GWFG also subscribes to a pallet-management system to minimize wasted shipping pallets. GWFG reduces its energy intake and emissions through upgraded equipment such as LED light bulbs, on-demand lighting, chillers for space cooling, and energy-efficient compressors. GWFG reduces its transportation carbon footprint by scheduling its work shifts to minimize commute time and by optimizing its boxes and pallet loads to utilize the maximum space on each truck.

Gavina Coffee
Gaviña Coffee is a minority and family-owned coffee roaster that prioritizes a greener coffee footprint through sustainable sourcing, operational efficiency, and social stewardship. Gaviña repurposes its coffee chaff as an ingredient in animal feed. The company has retrofitted its swamp coolers to save water, and it replenishes groundwater through its permeable patios. Energy efficiency measures include free electric vehicle charging, electric forklifts, infrared coffee bean roasting, and on-site inert gas production. Gaviña Coffee provides free meals for its staff on Saturdays, sourced from local establishments.

Helping Hands Society of Los Angeles
Helping Hands Society of Los Angeles (HHOLA) is a non-profit organization that serves people in need in 25 cities within LA county and surrounding counties. HHOLA provides almost 6000 food boxes per week containing shelf-stable foods, produce (fruits and vegetables), meat, and dairy donated from wholesalers and distributors. HHOLA also offers household items and furniture. HHOLA donates the 5% of food not suitable for human consumption to farms for animal feed. To expand the types of food it can accept and distribute, HHOLA hopes to build walk-in coolers and freezers. HHOLA is grateful for its network of donors, wholesalers, and produce distributors who have helped it bring hope to people in times of despair and need. ..

Item 11 Page 38 of 82
Appendix B:

Existing Conditions
Assessment
..

Item 11 Page 39 of 82
March 16, 2023
Freddie Agyin and Lisa Umeda, City of Vernon
Jeff Caton and Stephanie Cadena, Environmental Science Associates Environmental Sustainability Action Plan – Existing Conditions Report Summary
The Environmental Sustainability Action Plan will serve as a framework for addressing environmental and sustainability issues in the City of Vernon (City), with focus on core areas of air quality and greenhouse gas emissions, climate change adaption and resilience, energy efficiency, transportation, water, materials and waste, food production and security, and green business and economic development. This summary presents findings from a review of existing plans, policies, programs, and initiatives related to sustainability for the Environmental Sustainability Action Plan (ESAP) under contract Task A.1, Existing Conditions Report. Assessing current initiatives and planned actions allows for the identification of policy or program gaps that should be addressed in the ESAP and assists with aligning actions with regional and State goals. A quick-reference summary of the relevance of existing plans, programs, and policies to the ESAP is provided in Attachment A– Relevant Plans, Policies, and Programs, followed by a table summarizing the sectors addressed by existing documents in Attachment B– Policy Relevance of Local and Regional Initiatives to the ESAP. Finally, a listing of recommended actions from the 2011 Sustainability Action Plan is provided in Attachment C– Targets and Actions of the 2011 Sustainability Action Plan.

Sustainability Highlights
As described in more detail below, the City is currently engaged with various program and planning efforts that are aligned with the goals of the ESAP. This includes City departments and commissions, such as the City’s Department of Environmental Health and Control and the Green Vernon Commission (GVC); Vernon is one of only four cities throughout California with a health department that is focused on environmental health and safety of the community, and the GVC is one of three municipal bodies within the Gateway Cities region that is dedicated to addressing community issues around sustainability. Additionally, the City operates its own public utility, Vernon Public Utilities (VPU), that serves as an essential resource to the City’s residents and business community, providing dependable, high-quality utility services at a significant cost savings compared to neighboring utility providers. VPU is uniquely positioned in the state of California, in that it is one of only two utilities in California that provides electricity, natural gas, water and fiber optic services.

The City is in the process of updating its Local Hazard Mitigation Plan (LHMP), and General Plan Housing and Safety elements. The public drafts of the LHMP and the Housing Element both include climate change considerations that extend to the sustainability of the built environment, particularly for ensuring existing ..

Item 11 Page 40 of 82
Existing
Conditions Report
3 infrastructure and buildings are designed and maintained for long-term service. The City is also developing the Westside Specific Plan to spur development of diverse and mixed land uses, increase the City’s residential population, increase amenities for residents and employees, and attract new talent and innovation, while maintaining the City’s reputation and competitive advantage as a center of industrial production.

Recently the City has completed an Urban Tree Canopy (UTC) assessment in partnership with the Gateway Cities Council of Governments (GCCOG), Loyola Marymount University Center for Urban Resilience (LMU CURes), and TreePeople. The assessment found that up to 51 percent of the City’s surface area could accommodate tree plantings and identified highly suitable locations for prioritizing plantings. The UTC anticipates communitywide benefits from tree plantings that include greener spaces and beautification, shading, mitigation for heat, improvements to local air quality, and improvements to pedestrian pathways.

There are also a number of previous regional efforts relating to regional sustainability and climate action planning that include the City of Vernon, which help provide a solid foundation for the Air Quality and Greenhouse Gas Emissions, and Climate Change and Resilience sectors of the ESAP. This includes the GCCOG’s Climate Action Planning (CAP) Framework (2018), the County of Los Angeles (LA County) OurCounty Sustainability Plan (2019), and the Southern California Association of Governments’ (SCAG) Regional Climate Adaptation Framework (2021).

Existing Policies and Programs
A summary of the City’s existing policies and programs, as relevant to sustainability, is provided in Attachment B – Policy Relevance of Local and Regional Initiatives to the ESAP. The results of our analysis indicate that the City has a strong foundation of policies and programs for increasing sustainability and addressing social, economic, and environmental factors across many sectors:

Air Quality and GHG Emissions: Community GHG inventories for the City of Vernon have been developed for the calendar year 2010 by the GCCOG, and for the years 2015 and 2018 by the County of Los Angeles. ESA has the background data used to develop these inventories. The City is subject to mandatory GHG reporting under U.S. Environmental Protection Agency (EPA) and the California Air Resources Board (CARB). The City also has existing municipal GHG inventories for the years 2010 through 2020, and a Greenhouse Gas Inventory Management Plan that outlines the City’s procedures for calculating and reporting emissions for internal purposes. There is also regional air monitoring and air quality data available from the South Coast Air Quality Management District through its AB 617 programs in communities near Vernon, particularly for diesel particulate matter (diesel PM) and nitrogen oxides (NOx).

Climate Change Adaptation and Resilience: The 2011 Sustainability Plan for Vernon provides targets and actions to address sustainability across various sectors (energy, transportation and land use, water, and waste).

Additionally, there are other local and regional resources that provide opportunities to build on climate change adaptation and resilience efforts in Vernon. The City’s 2022 Public Draft of the LHMP provides an assessment of hazards in Vernon and discusses the impacts of climate change, including drought, severe weather patterns, flooding, epidemic/pandemic, and air pollution. It also provides a vulnerability assessment for physical and social vulnerabilities from identified hazards. The City’s recently completed UTC assessment (2022) identifies suitable locations for new tree plantings, with the goal of expanding urban forestry and mitigating for the impacts of extreme heat. Further, as a member of SCAG, Vernon has access to recent data and resources for climate change adaptation planning, which may prove useful in developing strategies to prepare for the impacts of extreme heat, ..

Item 11 Page 41 of 82
Existing
Conditions Report
4 increasingly frequent and damaging wildfires and worsening air quality, storms and flooding, and other climate- related hazards. The City Council recently received an update to the VPU 2022 Wildfire Mitigation Plan for the implementation of preventative strategies and mitigation measures to minimize the risk of wildfires caused by electrical lines and equipment and has no potential for causing a significant effect on the environment.

Energy (Building Energy/Energy Use): The VPU staff are participating members of the ESAP’s Steering Committee. The VPU’s Integrated Resource Plan (IRP), which is in the process of being updated, provides data on energy demands and projections, as well as estimates for future renewable energy supply and GHG emission reductions. The IRP outlines actions for meeting state goals for renewable energy supply and increasing local resilience of the energy system. The IRP is currently being updated by VPU. AB 1890 provides for programs and rebates to customers for Energy Efficiency; research, development and demonstration (RD&D) Investments; Renewables, and; Low Income. In accordance with AB 802, the City assists customers in reporting energy use data to the California Energy Commission annually.

Transportation: The City’s policies regarding transportation are contained in key documents including the General Plan Circulation Element and Bicycle Master Plan. Once completed, the Westside Specific Plan may also develop infrastructure policies and projects that guide transportation within the study area. City policies for transportation are centered around coordination with various agencies such as Metro, neighboring cities, Caltrans, and private entities such as rail yards and local businesses that move goods, to balance usage of the transportation system, reduce congestion, and promote safety for all road users. Beyond coordination with key entities, specific projects such as freeway ramps, I-710, signal coordination, and the LA River Path are specifically identified as projects to be pursued. Recent studies for the LA River Path project have evaluated potential options for improving the active transportation system in and around Vernon – Fehr and Peers supported the development of the City’s LA River Active Transportation Access Study in 2018, identifying suitable corridors for improving connections between the river, and key corridors and destinations in Vernon. Additionally, there is discussion of multimodal improvements and other considerations, such as grade separations and identifying areas where trucks must maneuver local streets during periods of high congestion, though there is a lack of specificity regarding locations or approaches to enacting these policies. Vernon retains control over local right-of-way; however, the City must work with Caltrans for I-710 and local rail providers and property owners to develop private rail spurs and yards. The City’s Bicycle Master Plan introduces five goals with 23 strategies– no formal policies were proposed or adopted as a part of this effort. The City’s Bicycle Master Plan contains a review of existing policies relevant for active transportation and can be found in Appendix 2 of that document.

Water: The City’s has existing policies that address water resources, potential water shortages and drought within the General Plan, Water Conservation Ordinance, and Urban Water Management Plan (UWMP). These policies are intended to reduce water usage in periods of shortage, and include watering days, limits to outdoor watering, and obligations for fixing leaks in a timely manner. Recycled water is used by the Malburg Generating Station and opportunities for expanding the recycling system is an option for VPU.

Materials and Waste: City policies, plans, and programs that focus on waste management are limited, and there is little information on compliance status towards state-mandated organics recycling (Senate Bill 1383). The City’s Public Draft of the LHMP provides a recommended action for the City to continue working with waste service contractors for increasing public and industrial knowledge of safe disposal practices, though this is focused on hazardous waste materials. Similarly, the General Plan provides policies for increasing safety from hazardous material waste and disposal sites. The City provides annual reporting of solid waste tonnage by hauler, ..

Item 11 Page 42 of 82
Existing
Conditions Report
5 and also provides electronic waste recycling and disposal events for businesses and residents, to encourage proper disposal practices.

Food Production and Security: The City collects information on the number of food service facilities, including rendering, cold storage, and USDA-regulated facilities, as well as commercial edible food generators. However, there is a lack of data on food supply and production (where food is coming from) and edible food recovery.

Participants of the ESAP Steering Committee has identified food production and recovery/waste as a sustainability issue of concern in the City, and has noted there are many industries willing to increase recycling as it relates to the food system. The City’s health department works with industries to ensure compliance with health codes and regulations, and coordinates with the AQMD to remain informed of issues relating to rendering operations.

Green Business and Economic Development: The VPU offers incentive and rebate programs to all customers for energy efficiency, solar/photovoltaic installations, and natural gas upgrades in buildings. VPU offers Free Comprehensive Energy Audits to Vernon utility customers. The energy audit is a good starting point for customers interested in developing a broader energy management strategy. Customers receive detailed analysis of their energy usage, followed by suggestions for improved energy efficient efforts, which can lead to significant energy and cost savings. In addition to recommending traditional methods of increasing energy efficiency such as upgrading light fixtures, the audits may recommend newer energy efficient technologies unique to industrial customers, including replacement of motors and air compressors. If the customers decide to move forward with the energy efficiency measures, VPU provides incentives through its Public Benefits Program or Cap & Trade funded Natural Gas Rebate Program. The current development of the Westside Specific Plan is considering opportunities for new industries and uses to come to Vernon – there is potential to attract green business and industry through this plan and consider uses that bring greener, and more sustainable practices and technologies. There is also potential for expanding on existing green business and economic development, though there is limited information on current programs, policies, and resources oriented towards green business.

Baseline Conditions
Demographics
As of the 2020 Census the total residential population in Vernon is 222 people, though the daytime population is estimated near 50,000. The majority of residents identify as Hispanic or Latino. Children under five make up 8.5 percent of the population, and 39.5 percent of the population is under 18 years old. Community members 65 years or older make up 13 percent of the population. There are 78 housing units in Vernon, and 78 percent of households have individuals that speak a language other than English (U.S. Census Bureau, 2020). In 2020, 13 percent of people in Vernon had a four-year college degree educational attainment and an employment rate of 56 percent.

This demographic data provides a preliminary view of potential social vulnerabilities in the residential community, which include people of color, children, seniors, and non-English speakers. This data will be considered during the development of strategies for climate change and community resilience, intended to help build resilience communitywide to impacts of extreme heat, worsening air quality, flooding and storms, and drought. ..

Item 11 Page 43 of 82
Existing
Conditions Report
6 Air Quality and GHG Emissions
Communitywide GHG Inventories
With respect to GHG emissions, the GCCOG’s CAP Framework project provides a collection of inventories and forecasts, reduction targets, and strategies for reducing emissions across the economic sectors of land use and transportation; energy; solid waste; water and urban greening. The GCCOG’s CAP Framework provides the City with a 2010 communitywide GHG inventory, which establishes a basis for measuring future climate action progress, as well as emissions forecasts for the years 2020, 2030 and 2040. Additionally, the County of Los Angeles has developed communitywide GHG inventories for Vernon for the calendar years 2015 and 2018.

These inventories are described in more detail within Attachment A – Relevant Plans and Programs.

Table 1 below summarizes the data collected from those efforts. For the sectors evaluated, the inventories show similar results except for on-road transportation (it is not clear yet what is included under “other combustion” in the 2018 LA County inventory). For the three sectors not evaluated by the County at the City level (off-road equipment, water conveyance, and short-lived climate pollutants or SLCPs), the 2010 numbers from the GCCOG inventory (indicated by italics) are inserted for 2015 and 2018 for the purpose of comparing the inventory totals.

The County’s inventories indicate that emissions from on-road transportation dropped approximately six percent and 20 percent from 2010 levels in 2015 and 2018, respectively (as indicated in Table 1 below). Our review of the underlying data for these inventories reveals that the vehicle miles traveled (VMT) data in 2015 and 2018 changed only slightly from 2010 levels; thus, it is evident that the County estimated on-road transportation emissions for 2015 and 2018 using emission factors that differ significantly from those used for 2010.

Table 1: Comparison of Vernon GHG Inventories (community-wide) for 2010, 2015, and 2018 As the project moves into the stakeholder engagement phase under Task B.4, Develop Candidate Strategies, ESA will re-calculate on-road transportation emissions for all three years using consistent methods and emission factors. In doing so we expect to see a smaller change in on-road transportation emissions across the three inventory years. In addition, we will be estimating City of Vernon emissions for off-road equipment, water ..

Item 11 Page 44 of 82
Existing
Conditions Report
7 conveyance and SLCPs, if possible, depending on available data, so that meaningful comparisons can be made across the three inventory years, informing the strategies developed for the ESAP.

The forecasts provided by GCCOG are based on the expected growth of the City’s residents and businesses through the year 2040, as determined by SCAG in its 2016 Regional Transportation Plan (RTP). The forecasts do not account for important statewide regulations and policies that will reduce emissions significantly over time, including requirements to increase vehicle fuel efficiency, increase proliferation of electric vehicles, and decrease the GHS associated with electricity production. However, VPU is subject to state mandates to meet renewable portfolio targets.

Municipal GHG Inventories
The City has developed municipal GHG inventories from 2010 through 2020 (except for 2014) that provide valuable information of major polluting sources (sectors) within the City’s control. The VPU continues to manage the GHG inventory for its gas, electric, generation, and SF6 reporting to U.S. EPA and CARB. Documentation of methods and activity data for the inventories is provided in the City’s GHG Inventory Management Plan (updated July 2022).

In 2010, GHG emissions totaled 22,570 metric tons of carbon dioxide (CO 2) equivalent (MTCO2e); in 2020 this
had increased to 26,595 MTCO2e, an increase of almost 18 percent over 10 years. For all years, the greatest source of emissions is attributed to power generating facilities (power transmission and distribution).

Climate Change Adaptation and Resilience
As part of the ESAP development, the City held its first meeting of the Steering Committee in November 2022 with participation from City of Vernon department heads and stakeholders. Within this meeting, a majority of participants noted climate change as a primary concern for Vernon and its relevance to other areas of sustainability.

Expected impacts from climate change in Vernon include deteriorating air quality, more severe and prolonged droughts, more extreme weather conditions, increased risk of flooding, and an increase in pandemic/vector-borne diseases. These threats will not affect everything and everyone equally. Certain populations will experience the impacts of climate change earlier, more often, or more severely, such as children and seniors, the economically disadvantaged, and those with disabilities or pre-existing health issues. Climate change and its impacts add to the cumulative stresses already experienced by populations that lack adequate financial resources, those living in communities with higher incidences of crime, or who have limited access to employment, higher education, health insurance, or personal transportation.

The state designates the City of Vernon as a disadvantaged and low-income community that faces greater and disproportionate impacts due to air pollutants and toxic contaminants, groundwater threats, cleanup sites, hazardous waste, and solid waste sites. A review of climate change data for the City of Vernon finds the following conditions and expected impacts for the following hazards:

Extreme heat: Maximum temperatures and the number, and intensity, of extreme heat days are expected to increase. Historically, the maximum average temperature in Vernon is 76°F; this maximum is expected to increase up to 88°F by 2100 (Cal-Adapt, 2021). Additionally, the City has historically experienced an average of ..

Item 11 Page 45 of 82
Existing
Conditions Report
82 extreme heat days per year; this is expected to increase up to 6 4 days by 2100. Warm nights are also expected to
increase, from 6 historically, up to 99 nights in 2100.

Air Quality and Wildfires: Vernon is not located within a fire hazard severity zone or fire threat area, however, increasing number and severity of regional wildfires are expected to worsen air quality by increasing particulate matter concentration in the region. Recent data shows that particulate matter (PM 2.5) concentration in Vernon is approximately 12.2 micrograms per meter cubed (m
3 ), which is greater than 88 percent of other communities statewide (OEHHA, 2021). Diesel particulate matter (diesel PM) concentration in Vernon is also found to be greater than 88 percent of other communities statewide, with approximately 0.46 tons of diesel PM emitted into the air per year.

Vector-borne diseases: Climate change impacts on weather patterns, particularly warming temperatures, can create suitable conditions for vector-borne diseases to thrive and spread; mosquito and tick-borne illnesses present transmission risks of Zika, dengue fever, yellow fever, West Nile Virus, and Lyme Disease, among others (SCAG, 2020). There is growing concern from health professionals of the potential for invasive vector species to acclimate to southern California’s warming climate and increase diseases.

Extreme drought: Vernon, and the greater LA region, is currently in Severe Drought (D2) conditions due to decreases in average annual precipitation, soil moisture, snowpack, stream flows, and surface and groundwater levels; D2 conditions indicate the region can expect to see a longer fire season with greater burn intensity and larger fire spatial extent, greater stress on trees and plants, and increased risk of wildlife diseases (NIDIS, 2022). 1 Prolonged periods of drought can result in regional water supply shortages, degraded habitats, increasing concentrations of pollutants and salinity in water resources, and challenges to new developments. Regional water supply from the Metropolitan Water District (MWD) is expected to decrease.

Floods and storms: Vernon will see increasingly longer periods between rain, with dry spells increasing from a historic average of 159 days up to 211 days annually (Cal-Adapt, 2021). The number of precipitation events and storms are generally expected to stay the same, though they are likely to increase in severity, meaning greater and more intense rainfall when it does come. Increase in storm severity may also bring more intense winds to the region. Vernon is not currently in a designated special flood hazard area; there are no 100-year floodplains or 500-year floodplains within the city (FEMA, 2021). Flood risk in the City is minimal, however, it is possible some infrastructure may be more vulnerable to unprecedented storm surge and river flooding.

Energy Customers and Resources
VPU serves 1,927 customers, which includes 1,765 commercial and industrial customers. For FY 2022, VPU’s peak demand (MW) was 194.3 and approximately 99% of retail sales are to commercial and industrial customers.

VPU has several resources to meet the City’s load requirements. MGS, which is a city-owned combined cycle natural gas fired generating plant, supplies approximately 48% of the City’s load requirements, and 43% is supplied through eligible renewable resources. The remaining resources include large hydroelectric (2%) and nuclear (8%). VPU participates in power contracts through the Southern California Public Power Authority (SCCPA), a Joint Powers Authority. These energy resources include power purchased from the Palo Verde 1 Drought conditions are classified based on a measure of climatologic, agricultural, and hydrologic indicators. The 5 drought classifications are: Abnormally Dry (D0), Moderate Drought (D1), Severe Drought (D2), Extreme Drought (D3), and Exceptional Drought (D4) (NIDIS, 2022).
..

Item 11 Page 46 of 82
Existing
Conditions Report
9 Nuclear Generating Station (approximately 8%) in Phoenix, Arizona; Puente Hills Landfill Gas-to-Energy facility (approximately 3%) owned by the County’s Sanitation District; Hoover Dam Uprating Project (approximately 2%) on the Arizona/Nevada border; Astoria II Solar Photovoltaic Facility (approximately 6%) in between LA and Kern counties, Antelope DSR 1 Solar Project (approximately 5%) in Lancaster, and Desert Harvest/Maverick Solar Project (approximately 3%) in Desert Center, California.

Transportation
Vernon has 76 miles of local roadway and freeway. The I-710 provides a direct connection to the port of Long Beach and other highways that connect to the port of Los Angeles, from one of the largest railyards in the country, Hobart Yard. Key roadways in the City that provide connections to industrial businesses and neighboring jurisdictions (downtown Los Angeles, Boyle Heights, cities of Bell, Maywood, Huntington Park, and portions of unincorporated Los Angeles) include: • Alameda Street • Atlantic Boulevard • Bandini Boulevard • Downey Road • Leonis/District Boulevard • Pacific Boulevard • Santa Fe Avenue • Slauson Avenue • Soto Street • Vernon Avenue • Washington Boulevard Vernon is near the Metrolink Orange County and Riverside Lines (Commerce and Montebello/Commerce Stations) and the Metro Blue Line (Washington, Vernon, and Slauson Stations). Vernon is served by Metro lines 60, 105, 108, 251, 260, and 611, which operate on Atlantic Avenue, Vernon Avenue, Santa Fe Avenue, Soto Street, Leonis/District Boulevard, Pacific Boulevard, and Slauson Avenue. Montebello Bus Lines Route 50 operates on Washington Boulevard.

The only existing bikeway in Vernon is the 0.78-mile stretch of the Los Angeles River bicycle path that goes from Atlantic Boulevard to Slauson Avenue. The City of Los Angeles and the City of Huntington Park have existing bikeways, although none of these bikeways connect directly with Vernon. The Metro Blue Line First/Last Mile Plan identifies projects that could enhance bicycle and pedestrian access to the Washington, Vernon, and Slauson A (Blue) Line Stations, located a half-mile or less from the city border.

In regard to Vernon’s fleet the City has approximately 153 vehicles, the majority of which are gasoline-fueled light-duty trucks. The City has five electric vehicles and four that are gasoline/electric. Clean transportation infrastructure appears to be limited to two private, electric charging stations in western Vernon (near CRL Manufacturing) (Open Charge Map, 2022). There are no hydrogen fueling station locations within the City.

Water
Vernon is supplied through groundwater, imported water, and recycled water from the CBMWD Division 3.

Suppliers include the California Water Service Company (East Los Angeles District, Commerce System) which serves some of the northeast area of the City, and Maywood Mutual Water Company Number 3 which services a ..

Item 11 Page 47 of 82
Existing
Conditions Report
10 small portion of southeast Vernon. Over the past 10 years, water use in Vernon has primarily consisted of commercial and industrial uses (85 percent), followed by water use dedicated to power generation (10 percent), and the remaining for residential and other uses (5 percent) (City of Vernon, 2021a). The City has no surface water supply and does not divert stormwater for capture purposes.

The City draws its groundwater supply from the Central Groundwater Basin and has an Allowed Pumping Allocation (APA) of 7,539 acre-feet per year (AFY). In 2022, the City’s water production was 6,513 AFY and purchased 725 AFY of recycled water for the MGS, for power plant cooling purposes. Recycled water purchasing is currently limited to the MGS. Expansion of the recycled water system falls under the purview of the CBMWD; though there are projects planned for expanding recycled water in jurisdictions near Vernon (Bell Gardens, Lynwood, South Gate, Pico Rivera, Downey) none of these are currently planned to expand recycled water connections in the City.

Over time, water demand in Vernon is expected to increase due to the intensity of commercial and industrial uses in the City. The City’s Urban Water Management Plan ascertains that Vernon’s infrastructure, designed to meet the needs of commercial and industrial uses, is robust and able to meet future water needs. The UWMP projects water demand through 2045 and notes the City’s sources of water will be able to meet this demand under normal and dry years, including periods of drought.

Much of the City’s water is dedicated to customers for industrial processes (industrial and commercial uses). As such, the City provides water service at some of the lowest rates in the region to attract commercial and industrial customers, and avoids conservation pricing for water use reduction as it was determined to have a negligible effect on water savings and a negative effect on attracting more customers (City of Vernon, 2021a).

Materials and Waste
The majority of solid waste in Vernon is generated from manufacturing. Based on Vernon’s employment data by business sector and statewide averages of materials generation for those sectors, food manufacturing generates the highest amount of waste, estimated at almost 35 percent. This is followed by other manufacturing (30 percent), and wholesale and trucking (25 percent) while other business groups represent less than four percent of Vernon’s total generation (CalRecycle, 2022). By material categories, organics represent the greatest estimated percentage of total generation (27 percent), followed by metal (27 percent), paper (26 percent), inerts and other (11 percent), and plastic (7 percent). Other categories generate less than 2 percent.

In 2021 the City’s hauled solid waste totaled 135,073 tons, a decrease of eight percent from the previous year (City of Vernon, 2021b). The majority was serviced by Republic Services (Vernon is serviced by 14 haulers:

AAA Rubbish, American Reclamation, Athens Services, CalMet, CR&R Incorporated, GB Rubbish, Hal-Away Rubbish, Key Disposal, NASA, Quality Waste, Republic Services, Serv-wel, Universal Waste Services, Ware Disposal, Waste and Recycling Services, and Waste Management).

Most of the City’s waste is disposed of at Sunshine Canyon, approximately 30 miles northwest of Vernon. In 2019, major disposal destinations included Sunshine Canyon (47 percent), El Sobrante Landfill in Corona (20 percent), and Olinda Alpha Landfill in Brea (12 percent). ..

Item 11 Page 48 of 82
Existing
Conditions Report
11 Food Production and Security
Vernon is home to several, industrial food service facilities, including warehouse and refrigeration, processing, and commercial agriculture types, and a large number that are dedicated to meat/poultry processing. These include approximately 22 cold storage facilities and five rendering facilities, which provide animal feed, fertilizer, and biofuel from animal by-products. Commercial food service in the City is limited to supporting the daytime population. There are few markets and groceries, and no farmer’s markets in the City.

In 2022 the City welcomed Smallhold Mushroom Farm, a large-scale urban mushroom farming business that uses indoor agriculture technology to grow several mushroom varieties. The business locates in urban areas to grow and sell locally, with goals to reduce VMT associated with food transportation, use sustainable packaging (compostable cardboard), extend food shelf life, and reduce food waste, for a reduced carbon footprint to traditional mushroom-growing.

Green Business and Economic Development
The City is home to approximately 1,800 businesses, a majority of which are involved in food manufacturing, and provide significant benefit to the regional economy (Vernon Chamber of Commerce, 2022). Vernon offers a prime location for business due to lowered permit fees and costs for electricity, water, and natural gas utility rates; a municipal health department to regulate industrial operations and help businesses streamline monitoring and enforcement of health regulations; and major transportation connections that include the Port of Long Beach.

The City was recognized as "Most Business Friendly City" in Los Angeles County in 2008, and named a finalist for "Most Business Friendly City" in 2021 and 2022 Los Angeles County Economic Development Corporation (LAEDC). This recognition is for demonstrating leadership in economic development through efforts that encourage job creation and attract, support, and retain businesses. The City’s 2018 Integrated Resource Plan (IRP) notes that the majority of the City’s industrial customers have an occupancy history of up to 80 years, and the 25 largest customers have an average 31-year tenancy in Vernon.

There are several businesses in Vernon that are focused on sustainable practices as a product or service, including rendering, glass-recycling, and urban farming. The City provides information on its website to encourage sustainable business and practices that support economic development, including local workforce training and recycling; the City points to Cerritos College for employee training focused on manufacturing, business, management, and leadership skills, and provides information from CalReycle on financing and resources to businesses for using materials from the waste stream in their product manufacturing.

In regard to local employment, almost 70 percent of residents are estimated to work within Vernon, but they make up less than one percent of the City’s total workforce (City of Vernon, 2022a). The majority of the workforce, almost 54 percent, commutes from less than 10 miles away; approximately 34 percent commute from 10 to 50 miles and 13 percent commute from over 50 miles. The top-ten cities that contribute to Vernon’s workforce (46 percent of the total workforce) include: Los Angeles (27 percent), Huntington Park (3 percent), South Gate (3 percent), East Los Angeles (3 percent), Long Beach, Florence-Graham, and Downey (2 percent each), and Maywood, Compton, and Lynwood (under 2 percent each). The remaining (54 percent) commute from other, surrounding cities and communities. ..

Item 11 Page 49 of 82
Existing
Conditions Report
12 Findings and Recommendations
For the ESAP, the City can build on existing initiatives to develop a comprehensive approach to addressing environmental and sustainability issues in the city and increase community resilience. Based on a review of existing plans, programs and policies, ESA makes the following recommendations in developing sustainability strategies for improving the City’s sustainability performance across the eight sectors below, with plans for future stakeholder engagement to help finetune priority strategies. The findings and recommendations are organized by sustainability area in alignment with those identified in Task A.1, Existing Conditions Report.

Air Quality and GHG Emissions: • Make methodological refinements to the 2015 and 2018 inventories developed by County of Los Angeles so that they can be compared against the 2010 inventory developed by GCCOG (as discussed above) • Prioritize GHG emissions reductions strategies for the energy and transportation sectors, the largest contributors of emissions in Vernon, consistent with state targets. • Increase industries’ awareness of and engagement with community GHG emissions and mitigation strategies, capitalizing on existing partnerships and communication channels through the Green Vernon Commission
• Support implementation of AQMD’s emission reduction strategies for NOx and diesel PM in nearby AB 617 communities (Southeast LA, South LA, and East LA/Boyle Heights/West Commerce communities); monitor diesel PM and NOx data collected by the AQMD to inform consideration of air quality strategies that help reduce local sources of pollution
Climate Change Adaptation and Resilience • Engage with stakeholders and community through the ESAP Steering Committee and planned outreach activities (Task B, Engagement and Outreach Assistance) to learn about priority concerns regarding climate change impacts, and to help prioritize adaptation efforts; use the LHMP’s vulnerability assessment to inform development of adaptation strategies that help increase physical and social resilience to climate change impacts
• Support/collaborate with the Public Works department and the GVC to implement the Urban Tree Canopy assessment recommendations for tree plantings in suitable locations; in alignment with this work, consider a policy for protecting existing and new trees that provide benefits against climate change (air quality, extreme heat) and enact a replacement policy for trees that need to be removed • Maintain Tree City USA recognition from the Arbor Day Foundation Energy (Building Energy/Energy Use) • Review and implement recommendations, if feasible, and track progress of the 2022 -2023 IRP, once
approved by City Council
• Explore opportunities for providing incentives to warehouses in Vernon for electrification ..

Item 11 Page 50 of 82
Existing
Conditions Report
13 Transportation • Work with businesses and residents to identify the VMT reduction strategies that are most aligned with local land use patterns, business needs, and facilitate access to/from and around Vernon with fewer vehicle trips and/or reduced trip lengths; Vernon’s major corridors are served by transit and employment areas are proximate to regional rail commuter stations
• Coordinate with Caltrans regarding the I-710 project and modifications to local freeway ramps that affect local roadways
• Coordinate with local businesses to identify strategies that facilitate goods movement and minimize the potential negative impacts on people and infrastructure • Coordinate with Metro to complete the LA River gap closure • Encourage the Westside Specific Plan as a model for the development of future transportation infrastructure that coordinates with land use changes and provides multimodal infrastructure that can help reduce VMT for both residents and employees of the area Water • Work with the CBMWD to expand opportunities for industrial and commercial facilities to access water efficiency upgrades that help reduce water consumption
• Support potential, future CBMWD projects for expanding the recycling water system in Vernon Materials and Waste • Identify practices for documenting edible food recovery, through partnerships with dedicated organizations and through industry initiatives
• Consider waste management and reduction policies within the City’s municipal code and General Plan; focus on waste generated from industrial and commercial activities, particularly around organics and metal manufacturing
• Identify practices for documenting business-to-business recycling programs; consider engagement and partnerships with local businesses to identify local opportunities for business-to-business materials recycling and closed-loop manufacturing.

Food Production and Security • Identify feasible practices and local partnerships for expanding organics collection • Consider strategies to support local and regenerative food systems ..

Item 11 Page 51 of 82
Existing
Conditions Report
14 • Identify opportunities for attracting urban farming businesses; consider local partnerships for starting public urban farms or community gardens; explore partnerships with food production businesses to host a community farmer’s or produce market
Green Business and Economic Development • Work with the AQMD to implement sustainable best practices for rendering facilities and support industry activities for compliance with Rule 415 (see Attachment A: Relevant Regional Plans and Programs); support industry activities to expand operations for processing of materials to sustainable products, such as renewable diesel
• Encourage green business attraction within the West Side Specific Plan that is in development; consider uses that will increase sustainable business presence in Vernon • Consider policies that can be integrated in other City plans and programs, such as existing elements of the General Plan or within an economic development plan, that support “green” or cleantech businesses and jobs
• Consider opportunities for engaging in regional efforts to attract green businesses, grow the number of jobs, and engage with local industries and businesses (e.g., Vernon Chamber of Commerce, LAEDC, Gateway Cities Economic Development Working Group)
• Continue information sharing for local/regional workforce training and education opportunities in manufacturing and business programs; consider strategies for increasing local hires that support shorter commutes and intersect with transportation/VMT-reduction strategies ..

Item 11 Page 52 of 82
Existing
Conditions Report
15 Attachment A – Relevant Plans, Policies, and Programs Local
City of Vernon Greenhouse Gas Inventorying
Greenhouse Gas Inventory Management Plan
The July 2022 update of the City’s Greenhouse Gas Inventory Management Plan (GHG IMP) outlines the procedures used to calculate and report GHG emissions. It contains specific information regarding data collection and management, emissions quantification, and requirements for reporting. The City is subject to mandatory reporting under U.S. Environmental Protection Agency (EPA) and the California Air Resources Board (CARB).

Prior to 2015, the City also reported to The Climate Registry (TCR), a voluntary reporting agency supporting the collection and verification of GHG data consistently across jurisdictions. TCR guidance is still used to prepare a comprehensive GHG emissions inventory for internal purposes, when needed. Calendar year 2020 (data year 2019) was the last year a complete TCR GHG emissions inventory was prepared according to TCR guidance.

Municipal GHG Inventories (2010 – 2020)
The City has developed municipal GHG inventories for the years 2010 through 2020 (except for 2014) as part of reporting for TCR, in addition to reporting to U.S. EPA and CARB for the City’s Generation, Gas, Electric, and sulfur hexafluoride (SF6). The most recent GHG inventory for the year 2020 provides emissions data for Scope 1 (Stationary Combustion, Mobile Combustion, Fugitive emissions), and Scope 2 (Purchased Electricity). This includes the following source types: • Facility (stationary combustion, refrigerant usage, fire suppression, indirect electricity), • Streetlights and traffic controls indirect electricity, • Water delivery (stationary combustion and indirect electricity), • Power plant (stationary combustion, SF6, and indirect electricity), • Vehicle fleet (on-road mobile combustion, off-road mobile combustion, refrigerant usage), and • Natural gas transmission and distribution fugitive.

City of Vernon Sustainability Action Plan (2011)
The 2011 Sustainability Action Plan covers the City’s history addressing sustainability issues, provides baseline data, and includes goals, targets, actions, and implementation timeframes in the areas of: GHG emissions, Energy Efficiency, Transportation and Land Use, Water Conservation, and Waste Management. Additional sections include green business and manufacturing, resource conservation, and sustainable construction. The targets and actions from the 2011 Plan are included as Attachment C. These have not been implemented by the City and there is little information on the status or progress of the targets and actions set in the plan. ..

Item 11 Page 53 of 82
Existing
Conditions Report
16 City of Vernon General Plan (Amended 2015)
The City of Vernon General Plan, adopted in December 2007 and most recently amended in April 2015 is intended to guide the growth of the City in a manner that best serves its citizens and industries. The elements within the General Plan contain various policies that relate to the sustainability of systems in Vernon, including energy, water, and waste. Below is a list of relevant goals and policies to the ESAP, from the General Plan:

Land Use Element • GOAL LU-1 Promote and maintain manufacturing and other industrial uses as the primary land use within the City. o POLICY LU-1.5: Permit truck and freight terminals on a limited basis to minimize the impacts associated with heavy trucking activity. Designate such permitted areas using an overlay zoning district or similar mechanism.
o POLICY LU-1.5: Continue to maintain up-to-date information regarding flooding hazards consistent with the Safety Element.
• GOAL LU-2 Phase out aging industrial building and sites through modernization and replacement. o POLICY LU-2.3: Continue to enforce all applicable building and health and safety codes. o POLICY LU-2.4: Provide incentives to property owners to revitalize industrial structures or recycle/demolish obsolete or vacant structures.
o POLICY LU-2.5: Assist in the reuse of properties from one industrial use to another. o POLICY LU-2.6: Accommodate the expansion of Soto Street north of 37th Street/Bandini Boulevard pursuant to Circulation and Infrastructure Element policy by requiring properties with frontage along this corridor to dedicate land to the public right-of way sufficient to accommodate the roadway widening in the event that such properties redevelop or undergo substantial improvements. o POLICY LU-2.7: Consider and facilitate proposals for more intensive employment-generating, nonresidential development near transit stops.
• GOAL LU-3 Maintain Vernon as a highly desirable location for industry, and continue to attract the types of industry the City is well positioned to serve. o POLICY LU-3.1: Review City codes and development requirements on a regular basis to ensure that development costs and standards are competitive with other industrial cities. o POLICY LU-3.2: Foster a City government and governmental structure that is responsive to the needs of industry located in a metropolitan area.
o POLICY LU-3.3: Maintain power plants as key land use in the community, and allow for the expansion and/or development of new facilities to provide a reliable, cost-effective source of energy to industrial users.
o POLICY LU-3.4: Invest in activities and programs that advertise and promote Vernon as a quality and desirable location for industry.
o POLICY LU-3.5: Use development proposals as opportunities to encourage modernization and broaden property improvements goals.

Resources Element: • GOAL R-1 Conserve and protect the region's water and energy resources. o POLICY R-1.3: Seek and pursue the most practicable and cost-effective means of implementing National Pollutant Discharge Elimination Systems requirements.
• GOAL R-2 Contribute to the continued gradual improvement of air quality in the South Coast Air Basin. o POLICY R-2.1: Coordinate and cooperate with the South Coast Air Quality Management District and Southern California Association of Governments in efforts to implement the regional Air Quality Management Plan.
o POLICY R-2.2: Encourage and facilitate the use of public transportation to reduce emissions associated with automobile use.
o POLICY R-2.3: Continue to expand the number of City-owned alternative fuels vehicles, hybrid vehicles, and other energy-efficient vehicles as they may be available. ..

Item 11 Page 54 of 82
Existing
Conditions Report
17 o POLICY R-2.4: Maximize the amount of clean electrical power produced while minimizing emissions from power production plants.
• GOAL R-3: Preserve established open spaces, and look for opportunities to create new open space areas that can benefit the health and welfare of workers and residents in Vernon. o POLICY R-3.1: Continue to maintain landscaped areas at City facilities as appropriate. o POLICY R-3.2: Cooperate with regional efforts to upgrade the appearance and open space value of the Los Angeles River Channel.
o POLICY R-3.3: Encourage private property owners and industries to establish and maintain private landscaped areas for the benefit of employees.
o POLICY R-3.4: Continue the City's street tree planting and tree maintenance programs.

Housing Element: • GOAL H-1: Ensure that all housing units are maintained in decent, safe, and sanitary condition. o POLICY H-1.1: Continue to enforce all relevant building and zoning codes to ensure that all residential units are adequately maintained.
o POLICY H-1.2: Require any new or residential units undergoing a major alteration to be equipped with air filtration systems (such as HVAC systems) and sounds insulation (such as dual-paned windows) to protect residents from exposure to adverse environmental conditions. • GOAL H-3: Create opportunities for the development of new housing in areas of the City that have the least potential for adverse impacts associated with established industrial uses and truck routes. Locate such new housing nearby community services. o POLICY H-3.2: Strategically locate sites for new housing so as to minimize noise, vibration, smoke, noxious gases, glare, heat, dust, odors, air pollution, and other adverse impacts associated with industrial uses, slaughtering and rendering uses, businesses that release toxic materials, and trucking and railroad facilities and routes.
o POLICY H-3.3: Encourage development of residential uses in strategic proximity to schools, recreational facilities, commercial areas, parks and other public spaces, and transit routes.

Safety Element: • GOAL S-1 Minimize the risk to public health, safety, and welfare associated with the presence of natural and human-caused hazards.
o POLICY S-1.4: Maintain the public water distribution and supply system facilities to provide adequate capacity to meet both everyday and emergency fire-flow needs. • GOAL S-2 Provide a high degree of protection for all residents and workers from hazardous materials and the hazards associated with the transport of such materials. o POLICY S-2.1: Continue to support and encourage State efforts to identify existing or previously existing hazardous waste generators or disposal sites in the City of Vernon. • GOAL S-3 Maintain high standards for the provision of City emergency services. o POLICY S-3.2: Require businesses handling, transporting, or producing materials considered acutely hazardous to prepare contingency plans for accidents involving these chemicals. o POLICY S-3.7: Develop a new Emergency Operations Center (EOC) with adequate space and facilities to respond to any emergency situation which may arise
• GOAL S-4 Provide a high degree of protection for all workers and residents in the event of any disaster. o POLICY S-4.3: Design and maintain an effective plan for the prompt evacuation of the City in the event of a dam inundation or other major disaster requiring the removal of workers or residents from Vernon. o POLICY S-4.4: Identify facilities for use as emergency/disaster shelters for those unable to leave or required to stay within the City in the event of a major disaster or emergency event.

Circulation & Infrastructure Element: • GOAL CI-1 Provide a balanced transportation system for the safe and efficient movement of people, goods, and emergency services throughout the City. ..

Item 11 Page 55 of 82
Existing
Conditions Report
18 o POLICY CI-1.1: Continue to improve the street system to meet the minimum standards contained in this Element.
o POLICY CI-1.2: Continue to coordinate with the rail companies to provide for efficient rail service that minimizes impacts on the local street system.
o POLICY CI-1.3: Limit rail yards to areas agreed on and consolidate rail spurs where feasible. o POLICY CI-1.4: Evaluate implementing measures that reduce the maneuvering of trucks on streets with substantial traffic during periods of high traffic volumes. o POLICY CI-1.5: Continue to pursue grade separation for railroad crossings on designated streets. o POLICY CI-1.6: Encourage the continued improvement of services provided by the Los Angeles County Metropolitan Transit Authority to Vernon and adjacent cities to provide good access from home to job and job to home for persons employed in Vernon.
o POLICY CI-1.7: Encourage the use of ride sharing and public transit for persons employed in the City to reduce traffic congestion and the need for off-street parking in the City. o POLICY CI-1.8: Continue to work with Caltrans and neighboring jurisdictions to improve the Atlantic/Bandini/I-710 intersection and to make improvements to the I-710 Freeway, including direct truck ramps to the rail yards and exploring the potential for adding an interchange at Slauson Avenue to improve access to the City.
o POLICY CI-1.11: Consider installing and maintaining an ATSAC system to improve traffic flow. o POLICY CI-1.12: Cooperate with the Metropolitan Transportation Authority and other local agencies in their efforts to complete a bicycle path along the levee of the Los Angeles River connecting to adjacent jurisdictions.
• GOAL CI-3 Maintain the water supply system to meet both normal demand and emergency needs. o POLICY CI-3.1: Periodically evaluate the entire water supply and distribution systems to determine their continued adequacy and to attempt to eliminate deficiencies or enhance service. o POLICY CI-3.2: Require all new developments and expansions of existing facilities bear the cost of providing adequate water service to meet the increased demand which they generate. o POLICY CI-3.3: Implement the programs and policies contain in the City’s Urban Water Management Plan, including particularly those related to reliability planning and conservation and reuse. o POLICY CI-3.4: Use reclaimed water for cooling and other functions at the Malburg Generating Station and the future Vernon Power Plant to the greatest extent feasible. • GOAL CI-4 Maintain the sewer system to assure the health and safety of all residents and businesses. o POLICY CI-4.1: Periodically evaluate the sewage disposal system to determine its adequacy to meet changes in demand and changes in types of waste.
o POLICY CI-4.2: Ensure that all new developments bear the cost of expanding the sewage disposal system to handle any increase in load that they generate.
o POLICY CI-4.3: Investigate and implement means of financing maintenance and improvements to the sewer system.
• GOAL CI-5 Maintain the storm drainage system to assure the protection of lives and property of in Vernon. o POLICY CI-5.1: Periodically evaluate the size and condition of the storm drainage system to determine its ability to handle expected storm runoff.
o POLICY CI-5.2: Evaluate the impact of all new developments and expansion of existing facilities on storm runoff, and require that the cost of upgrading existing drainage facilities to handle the additional runoff is paid for by the development which generates the need to improve a facility. o POLICY CI-5.3: Monitor the use and storage of hazardous materials to prevent accidental discharge into the storm drainage system.
o POLICY CI-5.4: Allow new development projects to creatively implement NPDES standards and requirements.
• GOAL CI-6 Improve the City’s capability to generate and supply electric power to achieve energy self-sufficiency. o POLICY CI-6.1: Expand, operate, and maintain an electrical utility system in an effort to provide an adequate level of service to businesses and other uses in the City. o POLICY CI-6.2: Improve the electrical utility system in an effort to allow the City to meet any changes in demand over time.
..

Item 11 Page 56 of 82
Existing
Conditions Report
19 o POLICY CI-6.3: Cooperate and/or participate with other agencies or parties in the expansion or development of power generation.
o POLICY CI-6.4: Evaluate the impact of all new development on the electrical energy system, and require that the cost of upgrading existing facilities is paid by the development, which necessitates the upgrade. o POLICY CI-6.5: Expand the City’s capability to generate and provide natural gas to enhance the power/energy supply system.

Local Hazard Mitigation Plan Update (in development)
The Local Hazard Mitigation Plan (LHMP) is undergoing an update that will provide an understanding of threats from natural and human-caused hazards in the community. The plan will also recommend specific actions to proactively decrease these threats before disasters occur. The September 2022 Public Draft of the LHMP identities hazards that could affect Vernon, and provides a risk assessment, description of vulnerabilities, capabilities assessment, and a hazard mitigation strategy. The Public Draft identifies seismic hazards and drought as high-threat hazards to the community, followed by medium-threat hazards of epidemic/pandemic, flooding, air pollution, hazardous materials, wind, and dam failure. The Public Draft also includes climate change considerations within its assessment of each hazard.

For mitigation actions, the Public Draft prioritizes actions based on risks and threats, and considers costs of implementation. Relevant mitigation actions that relate to sustainability include:

Preparedness/General • Maintain at least one emergency power -generating station in all critical facilities in the City. • Explore the feasibility of connecting critical facilities to a microgrid power supply network. • Install energy-efficient equipment to increase the longevity of backup generator fuel supplies. • Repair, as feasible, all major deficiencies discovered by inspections to prevent collapse, failure, or damage in the event of a natural disaster.
• Coordinate with public and private utility operators to harden infrastructure and create redundant system connections between VPU and outside agencies/organizations. • Install and harden emergency backup power at City facilities, prioritizing installations for facilities that serve critical functions.
• Conduct a feasibility assessment of the installation of solar and battery backup systems at key critical facilities within the City.
• Work closely to increase awareness of hazard events and resiliency opportunities among socially vulnerable community members, including the homeless.
• Avoid building new City-owned key facilities in mapped hazard areas. If no feasible sites outside of mapped areas exist, ensure that such facilities are hardened against hazards beyond any minimum building requirements/mitigation standards.

Seismic • Encourage the installation of resilient (seismically appropriate) piping for new or replacement pipelines in close coordination with outside utility providers.
• Coordinate closely with Vernon Public Utilities (VPU), MWD, California Water Service (CWS), and Maywood Mutual Water Company (MMWC) on water use and water conservation efforts throughout the City. • Periodically update "Chapter 13.20 Water Conservation, Sections 13.20.030- 13.20.070” of the Vernon Municipal Code of Ordinances to reflect the latest advances in best practices in consumption, landscape design, and irrigation that reduce water use within the City.
• Work with VPU, CWS, and MMWC to develop a focused water leak pilot program to eliminate leaky water mains, sprinklers, and other water fixtures, focusing on areas of the City with the greatest water demand. ..

Item 11 Page 57 of 82
Existing
Conditions Report
20 • Support indoor and outdoor water efficiency through community-wide education and rebate programs and continue to maintain these programs and other restrictions on water use in the absence of drought.

Epidemic/Pandemic • Assess and institute necessary upgrades to critical facilities to allow for usage during a pandemic, including adequate ventilation and physical barriers.
• Coordinate with surrounding jurisdictions, local health care providers, businesses, schools, the Vernon Health Department, the Los Angeles County Health Care Agency, the California Department of Public Health, and the Centers for Disease Control to inform community members about current public health trends or issues, free and low-cost healthcare options, treatments, and where to find local healthcare facilities. • Cooperate with the Vernon Health and Environmental Control Department, Greater Los Angeles County Vector Control District to inform community members on best practices for mosquito management and abatement.

Flooding/Dam Inundation • Identify potential flood improvements that reduce inundation from both storm flows and potential dam inundation effects.
• Investigate the use of permeable paving and landscaped swales for new construction and replacement of City owned hardscaped areas.
• Conduct frequent cleanings of storm drain intakes, especially before and during the rainy season. • Track areas where ponding frequently occurs during heavy rainfall and install new drains or upgrade existing ones to reduce ponding of water.

Air Pollution • Use the latest version of the CalEnviroScreen mapping tool to aid in the reduction of pollutant exposures to improve community health.
• Create and implement a limited idling program throughout the City, especially for large trucks. • Conduct a feasibility study to explore the possibility of incentivizing and encouraging local businesses to convert their fleets to include both electric and hybrid vehicles. • Conduct a feasibility study for noxious odors and other air quality issues associated with industrial uses within the City that have operated for many decades. Identify potential mitigation strategies to reduce odor concerns and complaints through a partnership with businesses in the City.

Hazardous Materials • Discourage new, sensitive land uses, including schools, parks, childcare centers, adult and senior assisted living facilities, and community centers, from being established near identified hazardous material facilities. Discourage or prohibit new hazardous material facilities from locating near sensitive land uses. • Continue to work with solid waste service contractors to educate residents and businesses on the safe disposal of small quantities of hazardous materials.

LA River Active Transportation Access (2020)
The City Council approved the LA River Active Transportation Access study in 2020, a study that assessed potential corridors and gateways for critical first/last mile connections between transit, the future LA river path, and destinations in the Vernon. The plan evaluated and provided conceptual design for three key east/west corridors, 37th Street, Vernon Avenue, and Leonis/District Boulevard, shown in Figure 1. These corridors were identified as suitable candidates within the 2017 Bicycle Master Plan process for corridor/bikeway connections to improve active transportation use and safety in the City. The LA River Active Transportation Access study provides guidance for accessing funding to develop the three corridors as Metro’s LA River path project comes to completion. ..

Item 11 Page 58 of 82
Existing
Conditions Report
21 Figure 1: LA River Active Transportation Corridors
Bicycle Master Plan (2017)
The Bicycle Master Plan (Master Plan), developed in 2017, provides a vision to establish a safe, convenient, and effective citywide system that promotes bicycling and walking as safe and viable transportation and recreation opportunities. The Master Plan supports a safer, more enjoyable, and more accessible active transportation network for community members. Barriers to bicycling and walking are addressed in the plan’s strategies, and the plan identifies opportunities, through outreach and improvement projects, to address obstacles to active transportation, improve community health, and reduce emissions related to the transportation sector.

LA River Path Feasibility Study (2017)
The LA River Path Feasibility Study is intended to develop preliminary pathway alignments and design concepts for a 3-mile segment of the LA River in Vernon. The LA River Path extends from the San Fernando Valley to Long Beach, with only an 8-mile gap from downtown LA to Vernon. This study will also inform the current Metro LA River Bike Path Gap Closure Project, which is designing and constructing the entire 8-mile gap.

Creating this path in Vernon will allow for a direct connection to and from Vernon for employees and residents and provide a route for regional path users to pass through Vernon.

Westside Specific Plan (in development)
The City’s Westside Specific Plan is currently in development with the goal of creating a vision for increasing the City’s residential population, with plans for adding diverse land uses, market-rate housing, retail, restaurants, and open space. The plan will set new zoning and development standards for development in different portions of the west side, and provide an implementation strategy for catalytic projects, infrastructure improvements and financing mechanisms. The Westside Specific Plan envisions projects to improve Vernon’s truck corridor along ..

Item 11 Page 59 of 82
Existing
Conditions Report
22 key roadways (Alameda, Santa Fe, Vernon, and Pacific); creating a walkable and pedestrian friendly environment along Santa Fe, and; redeveloping the Civic Center with a new urban plaza, retail, and approximately 300 residential units. The project is anticipated to increase economic opportunities for new industries and uses, increase community amenities, enhance long-term stability and fiscal standing, and increase resilience to future economic shifts, including natural shocks and climate change (Reimagine Vernon, 2022). The final Westside Specific Plan is expected in Winter 2023.

Urban Water Management Plan (2020)
The City’s 2020 Urban Water Management Plan (UWMP), adopted in 2021, discusses existing and forecasted water demand, supply, and reliability for the community, and provides demand management measures for future water use reductions. Most of Vernon’s geographic area is supplied by the City through groundwater from the Central Groundwater Basin, followed by imported and recycled water purchased from the Central Basin Municipal Water District (CBMWD) (City of Vernon, 2021a). Other suppliers include the California Water Service Company (East Los Angeles District, Commerce System) for water to the northeastern portion of the City, and Maywood Mutual Water Company Number 3, for water to the southeastern portion of the City, as shown in Figure 2: Water Service Area below. The City also has access to water from the Metropolitan Water District (MWD) for emergency supply.

The UWMP notes that climate change or increased emissions will not impact water supply or demand. This is attributed to existing partnerships with the South Coast Air Quality Management District (AQMD) and ongoing regulation for industrial activity that is likely to see reductions in emissions (for both stationary and vehicular sources), and the City’s projected growth for industrial/residential uses and employment that is limited, and therefore not a significant concern to increased emissions.

The UWMP also provides a drought risk assessment and addresses water shortage contingency planning, and notes the potential for groundwater contamination from industrial sources and materials. The UWMP projects the City’s sources of water supply are sufficient to meet demand through 2045, under normal and dry years, including drought conditions and climate change impacts. The UWMP describes three water conservation strategies to address potential water shortages:

Water Conservation Stage 1: The City Council may declare Stage I if a shortage of City water supplies up to 20 percent is determined to be likely, and this phase becomes mandatory is there is a shortage in excess of 20 percent of the normal water supply. At this phase, the City would implement conservation measures that include limits on watering days and obligations to fix leaks, breaks, or malfunctions.

Water Conservation Stage 2: The City Council may determine a water supply shortage or threatened shortage and determine consumer demand reduction is necessary. This stage becomes mandatory if there is a water shortage in excess of 30 percent of normal water supplies. Mandatory conservation measures would be implemented, including reduced watering days; quicker response required for fixing leaks, breaks, or malfunctions; limits on filling lakes or ponds (ornamental); limits on vehicle washing; limits on residential swimming pools and spas; limits on commercial nurseries, and; water restrictions for customers.

Water Conservation Stage 3: This stage is referred as an “Emergency” condition and exists when there is a shortage of more than 50 percent of normal water supplies. At this stage, the City would notify residents and business that a significant portion in consumer demand is necessary and implement mandatory phase 3 ..

Item 11 Page 60 of 82
Existing
Conditions Report
23 conservation measures that include those described in stages 1 and 2, as well as no watering or irrigation; limiting fire hydrant use; and requiring water conservation plans and progress reports from large commercial and industrial customers.

Figure 2: Water Service Area
Water Conservation Ordinance (2009)
The City’s 2009 Ordinance No. 1161 establishes general water conservation and water waste provisions intended to improve water use efficiency, regardless of supply conditions. The provisions set in the ordinance include:
limited watering hours and duration of watering; no excessive water flows or runoff; no watering of paved surfaces; obligation to fix leaks; use of recirculated water for water fountains or other decorative water features; limits on water for personal car washes, commercial car wash, and commercial laundry systems; no installation of single pass cooling systems in buildings requesting new water service, and; serving drinking water at establishments upon request (City of Vernon, 2009).

Urban Tree Canopy Prioritization (2022)
The Urban Tree Canopy project recently completed in September 2022 with a Final Report, developed in partnership with the Gateway Cities Council of Governments (GCCOG), Loyola Marymount University Center for Urban Resilience (LMU CUREs), and TreePeople. The project developed a local tree canopy assessment and community prioritization report with the goal of increasing strategic tree plantings in the community to help mitigate and reduce pollution and extreme heat.

Vernon was found to have the lowest amount of tree canopy in LA County, with 2 percent of its land area covered by Existing Tree Canopy, as shown in Figure 3: Existing and Possible Tree Canopy (LMU CURes, 2022). For comparison, LA County was found to have 18 percent average tree canopy cover and the GCCOG was found to have 15 percent average tree canopy cover. The analysis also showed that 47 percent of the City’s land area was deemed “not suitable,” meaning that tree planting cannot occur due to roads, rails, or buildings. The ..

Item 11 Page 61 of 82
Existing
Conditions Report
24 remaining 51 percent of the land area was found to be Possible Tree Canopy, though much of this was identified as “Possible-Impervious”, meaning that some modification of hardscaping may be needed to plant trees in these areas.

Of “Possible-Pervious” areas, few locations were identified as highly suitable for plantings.

Through this project, community members and City staff
identified top priority benefits desired from increased tree plantings, with a majority of participants identifying heat reductions as the highest priority, followed by addressing low tree canopy, improving air quality, and improving
pedestrian routes.

Power Integrated Resource Plan (2018)
Adopted in 2018, the Electric Integrated Resource Plan (IRP) provides the City with a 10-year blueprint for ensuring reliable and environmentally responsible energy provided at affordable rates for Vernon customers. The IRP is developed to comply with SB 32, SB 100, and SB 350 requirements for GHG reductions and renewable energy supply, and sets the VPU towards achieving carbon neutrality by 2045. The IRP also identifies a strategic plan to increase energy efficiency, energy savings, facilitate distributed energy resources (DERs), and support transportation electrification.

Renewable energy supply in Vernon is projected to increase, from 31 percent in 2018 to 56 percent in 2030, as shown in Figure 4: Energy Supply for 2018 and 2030 (projected). The IRP’s preferred portfolio supply through 2030 includes mostly solar, followed by wind, geothermal, MGS or other market-based natural gas resource, and energy storage. Additionally, the VPU’s power supply is expected to increase to 61 percent carbon- free in 2026, 71 percent in 2030, and 86 percent in 2037, the end of the IRP planning period. These measures slightly exceed the GHG emission reduction mandates set by SB 100 RPS and SB 32.

Figure 3: Existing and Possible Tree Canopy
..

Item 11 Page 62 of 82
Existing
Conditions Report
25 Figure 4: Energy Supply for 2018 and 2030 (projected) Regarding energy storage, the IRP determines a lack of cost-effective options for energy storage systems and recommended no targets for procurement at the time. The VPU committed to continually evaluate the cost- effectiveness of energy storage for utility operations in the future. One potential system, lithium-ion battery energy storage systems, are included in the IRP as a possible, future resource to help replace the capacity provided by MGS post-2028, though cost assumptions for this and other systems will be evaluated in future IRP updates and energy storage evaluation reports.

The IRP includes recommended implementation actions to help meet state goals and targets, including: utility- scale resource procurement, MGS replacement, distributed solar, municipal energy efficiency upgrades, light- duty vehicle electrification, and demand response and energy storage.

Energy Storage Evaluation Report (2020)
Pursuant to AB 2514, the VPU is required to evaluate feasible storage options every three years and determine establishing a goal. The 2020 Energy Storage Evaluation Report determines that battery storage is not appropriate or cost effective for the City at this time, and references the 2018 IRP’s assessment and previous energy storage evaluations of energy usage and supply in the City. The VPU will continue to assess the potential for energy storage system opportunities.

Currently, VPU is expected to participate in the Sapphire Project to provide long term Solar and Energy Storage System of renewable energy through the Southern California Public Power Authority (SCPPA). The three Participating Members include the City of Anaheim Public Utilities (APU), Pasadena Water and Power (PWP) and the City of Vernon Public Utilities (VPU) for the purpose of satisfying the utility's renewable resource goals.

Wildfire Mitigation Plan (2022)
The VPU developed the Wildfire Mitigation Plan (WMP) in compliance with state requirements (SB 901, AB 1054, and AB 111) to ensure the VPU constructs, maintains, and operates its electrical lines and equipment in a manner that minimizes potential wildfires risks. The WMP recognizes there is low wildfire risk in Vernon due to ..

Item 11 Page 63 of 82
Existing
Conditions Report
26 sparse vegetation and fuel sources, and the City is outside of High Fire Threat areas and Wildfire hazard areas, as designated by the California Department of Forestry and Fire Protection (CAL FIRE). The nearest wildland-urban interface is more than 10 miles from Vernon (VPU, 2022). As such, the WMP does not include wildfire preventative strategies.

Sustainability Initiatives/Activities
Green Vernon Commission
The Green Vernon Commission (GVC) was established in November 2011 as the Sustainable Development and Energy Efficiency Commission and renamed Green Vernon Commission in May 2014. The GVC consists of seven members, including three representatives for Vernon’s business community, two labor representatives; and two environmental representatives (one of which must be from the environmental-justice community). Members serve four-year terms and meet quarterly to conduct periodic reviews of the Sustainability Action Plan for the City operations and activities and also serves as a forum for addressing the public's concerns related to sustainability and energy efficiency issues. Recent initiatives presented at the GVC include the VPU’s Electrification Strategic Plan, the construction of a City park, and the recommendation for the City to adopt the Mandatory Organic Waste Disposal Reduction Ordinance.

Vernon Public Utilities Rebates and Incentives
The VPU offers several programs with rebates and incentives to Vernon customers to increase energy efficiency, cost savings, and renewable energy use. Incentive plans are funded by public benefit funds and Cap-and-Trade.

Public Benefits Program: The VPU offers cash incentives for lighting technologies, and energy efficiency equipment upgrades that include variable speed drives, air compressors, motors, refrigeration, chiller replacement, air conditioner replacement, and building envelope. It also includes energy management systems and other load and energy controlling devices. The VPU also offers free comprehensive energy audits to VPU customers, along with suggestions for improving energy efficiency.

Solar Energy & Net Metering Program: The VPU offers assistance for implementation of solar/photovoltaic energy systems to residential and commercial customers to help offset electricity demand, and offers rebates for eligible buildings.

Natural Gas Rebate Program: The VPU promotes projects that help reduce natural gas consumption and GHG emissions. Funded by GHG allowances (cap-and-trade auctions), this program offers rebates for pipe insulation, tank insulation, process boilers, steam traps, and other eligible equipment replacement. VPU also offers rebates for electric vehicle (EV) purchases or EV charging installations.

Waste Management
The City hosts periodic electronic waste (“e-waste”) recycling events for businesses and residents to properly dispose of electronics, including computers, televisions, batteries, fluorescents, ink cartridges, and other materials that cannot be sent to landfills. ..

Item 11 Page 64 of 82
Existing
Conditions Report
27 American Public Power Association Recognition
As of 2022, the VPU is recognized by the American Public Power Association (APPA) with a Diamond Level designation, the highest level, of Reliable Public Power Provider (RP3) for its provision of reliable and safe electric service. The RP3 distinction recognizes proficiency in reliability, safety, workforce development, and system improvements. This designation is held by public utilities over three years.

Vernon CommUNITY Fund Grant Committee
The Vernon CommUNITY Fund Grant Committee consists of 7 members, including one person representing members of the California Legislature, four persons that reside or work in the Vernon area, one Business Representative, and one current Council Member. This committee provides grants to charitable and governmental entities for projects and programs that benefit those residing and working in Vernon.

Regional Los Angeles County
OurCounty, Sustainability Plan (2019)
The Board of Supervisors adopted the OurCounty Plan on August 6, 2019, a regional sustainability plan for Los Angeles County. It outlines what local governments and stakeholders can do to enhance the well-being of every community while reducing damage to the natural environment and adapting to the changing climate. The plan mainly focuses on communities that have been historically disadvantaged and disproportionately burdened by environmental pollution. The plan is organized around 12 major themes that contribute to a shared vision for sustainability in the County:

Goal 1: Resilient and healthy community environments where residents thrive in place; Goal 2: Buildings and infrastructure that support human health and resilience; Goal 3: Equitable and sustainable land use and development without displacement; Goal 4: A prosperous LA County that provides opportunities for all residents and businesses and supports the transition to a green economy;
Goal 5: Thriving ecosystems, habitats, and biodiversity; Goal 6: Accessible parks, beaches, recreational waters, public lands, and public spaces that create opportunities for respite, recreation, ecological discovery, and cultural activities; Goal 7: A fossil fuel-free LA County;
Goal 8: A convenient, safe, clean, and affordable transportation system that enhances mobility and quality of life while reducing car dependency;
Goal 9: Sustainable production and consumption of resources; Goal 10: A sustainable and just food system that enhances access to affordable, local, and healthy food; Goal 11: Inclusive, transparent, and accountable governance that facilitates participation in sustainability efforts, especially by disempowered communities, and;
Goal 12: A commitment to realize OurCounty sustainability goals through creative, equitable, and coordinated funding and partnerships (LA County, 2019).

The plan also addresses environmental justice and historically disadvantaged communities who often bear disproportionate burden from environmental pollution. OurCounty envisions a healthier environment with cleaner air, water, soil, and renewable energy sources; affordable housing; accessible and diverse transportation network; and an expanded urban forest. ..

Item 11 Page 65 of 82
Existing
Conditions Report
28 2015 Community GHG Inventory
The County and Buro Happold developed 2015 community GHG inventories as part of the OurCounty Sustainability Plan for the unincorporated county and incorporated cities, including Vernon. These inventories capture emissions from various sectors: energy; transportation; waste; industrial processes and product use (IPPU), and; agriculture, forestry, and other land uses (AFOLU).

The County’s 2015 inventory shows that GHG emissions in Vernon totaled 753,107 metric tons CO2 equivalent.

The majority of the community’s emissions were attributed to the energy sector (66 percent), followed by transportation (22 percent), waste (10 percent) and IPPU (2 percent). Agriculture, forestry, and other land uses accounted for less than 1 percent of the total emissions.

Climate Vulnerability Assessment (2021)
Published in October 2021, the LA countywide Climate Vulnerability Assessment (CVA) studies both the social and physical vulnerabilities to climate hazards such as extreme heat, wildfire, and flooding as they are projected to become more severe in the coming decades. Equity implications are highlighted as climate vulnerabilities range across different communities and sub-populations within the county. The assessment explains that some people are at a greater risk of negative impacts due to structural inequities, along with other factors. The CVA used qualitative and quantitative methods to create a combined approach that highlights the voices, stories, and experiences of frequently excluded and highly vulnerable groups.

LA River Master Plan
The LA River Master Plan is an update of the LA County 1996 LA River Master Plan. The LA River Master Plan is centered around the understanding that infrastructure planning cannot be isolated from social and environmental needs. Therefore, the Plan seeks to build on prior and current planning efforts to reimagine the LA River from a single-use corridor to a multi-benefit resource for the communities of LA County. It recognizes the need for resilient systems that address climate change, population growth, resource scarcity, and social inequity.

These resilient systems are necessary to create 51 miles of connected, open space that supports clean water, native habitat, parks, recreation, multi-use trails, art, and cultural resources while also managing flood risk. The LA River Master Plan aims to make the reimagined river a reality over the next two and a half decades.

Southern California Association of Governments (SCAG)
The Southern California Association of Governments (SCAG) is the regional planning agency for Imperial, Los Angeles, Orange, Riverside, San Bernardino, and Ventura counties. It serves as a forum for regional issues relating to transportation, the economy, community development, and the environment. Connect SoCal, adopted in 2020, is SCAG’s latest RTP/SCS, a long-range visioning plan that balances future mobility and housing needs with economic, environmental, and public health goals
Regional Climate Adaptation Framework (2020)
SCAG prepared a comprehensive framework for climate adaptation planning, to assist the SCAG region with planning and preparation for the impacts of climate-related hazards, as well as addressing social and physical vulnerabilities and helping jurisdictions comply with Senate Bill 379. The Framework provides an analysis of climate change impacts and projections, and outlines a general process of adaptation planning that can be applied by local jurisdictions, including tools, maps, and model adaptation policies and strategies. Data provided in the ..

Item 11 Page 66 of 82
Existing
Conditions Report
29 Framework can help inform climate change and vulnerability considerations for sustainability strategies around extreme heat, severe storms, flooding, drought, regional wildfires, air quality and vector borne diseases.

Connect SoCal; Regional Transportation Plan and Sustainable Communities Strategy (RTP/SCS) (2020)
Connect SoCal builds upon and expands land use and transportation strategies established over several planning cycles to increase mobility options and achieve a more sustainable growth pattern. It charts a path toward a more mobile, sustainable, and prosperous region by making connections between transportation networks, planning strategies, and the people whose collaboration can improve the quality of life in the SCAG region. The RTP/SCS does not mandate future land use policies for local jurisdictions; rather, it provides a foundation of the regional policy upon which local governments can build. Local jurisdictions, including the City, partner with SCAG and are active members in the development and implementation of the RTP/SCS.

LA County Metropolitan Transportation Authority (Metro) Blue Line First/Last Mile (FLM) Plan
The Metro Blue Line First/Last Mile Plan conducted existing conditions, community engagement, walk audits, and the development of station area improvements that facilitate active transportation access to all 22 Blue Line Stations. The process included implementation of Metro's First/Last Mile Plan process through development of the pathway network that included coordination with City staff, community-based organizations, and Metro staff to identify locally supported projects that enhance access, comfort, and safety for Blue Line patrons. The plan calls for improvement such as improved crosswalks, lighting, bus stop enhancements to provide shelter/shade, landscaping, and pick-up/drop-off locations. Implementation is dependent upon funding and local jurisdictions and the plan has been used by several agencies to obtain state funding to install plan improvements.

The LA River Path Project
The LA River Path Project will provide a new active transportation path from north of downtown Los Angeles (Elysian Valley) to the City of Maywood, filling an eight-mile gap and improving pedestrian and bikeway travel along the river path. When complete, the project would connect communities along the LA River, a 32-mile grade-separated corridor from the San Fernando Valley to the City of Long Beach. Approximately 85,000 people live within walking distance of the river and one million live within biking distance; the project will provide a safe and comfortable option for all trips, including for people who commute to nearby jurisdictions such as Vernon (Metro, 2019). The project is currently in the environmental review phase, with a draft Environmental Impact Report (EIR) anticipated in the spring of 2023.

Rail to River Active Transportation Corridor (ATC) Project Metro’s Rail to River ATC Project is planning for a bicycle and pedestrian corridor connecting the Metro A Line (Blue) Slauson Station and the LA River path (refer to Figure 1). The project would provide a safe, comfortable, and continuous active transportation route that improves mobility and connectivity for local communities, and helps to reduce VMT. Recent studies determined the project could not be accommodated where planned, along Randolph Street, due to conflicts with the West Santa Ana Branch Transit Corridor. Metro is conducting an alternatives study to evaluate solutions that can accommodate both projects. ..

Item 11 Page 67 of 82
Existing
Conditions Report
30 West Santa Ana Branch (WSAB) Transit Corridor
The WSAB project will connect downtown LA to southeast LA communities through the City of Artesia along a proposed 19-mile light rail transit line, shown in Figure 5. The new line would be immediately adjacent to Vernon and connect to nearby communities of Huntington Park, Bell, downtown Los Angeles, unincorporated Florence-Firestone, and other communities in southeast LA. The new line would also provide transfers to the Metro A Line (Blue), Metro C Line (Green), and LA County regional transit. The project is currently in the environmental review process, expected to be completed in 2023.

Figure 5: WSAB Transit Corridor
..

Item 11 Page 68 of 82
Existing
Conditions Report
31 Gateway Cities Council of Governments
The GCCOG is a joint-powers authority comprised of 27 cities in southeast Los Angeles, including the City of Vernon. The GCCOG convenes various regional committees and working groups with voluntary participation by member cities to address for regional air quality and climate action, economic development, housing and homelessness, and transportation; these include the Energy Working Group, Planning Directors Committee, Public Works Officers, Economic Development Working Group, and Transportation Committee, among others).

Climate Action Planning (CAP) Framework
In 2018, the Gateway Cities COG completed the regional CAP Framework to support cities in preparing local CAPs. The CAP Framework helps individual communities advance their goals for economic development, public health, air quality, climate resiliency, equity, and job creation while reducing emissions and planning for the impacts of climate change. It includes 2010 GHG inventories and forecasts for the GCCOG member cities, as well as a set of tools and templates for setting GHG targets, selecting and prioritizing GHG reduction and adaptation measures, assembling a CAP document, and tracking implementation. The CAP Framework establishes air quality, public health, economic development, and GHG reduction as synergistic planning goals, and aligns CAP strategies with emerging economic opportunities in renewable energy, energy efficiency, low- carbon transportation, and renewable materials.
2010 Community GHG Inventory
As a participant in the Gateway Cities CAP Framework project, the City has an existing 2010 communitywide GHG inventory that can serve as a baseline for planning purposes. This inventory revealed on-road transportation as the largest contributor of GHG emissions in the community (52 percent), followed by energy (31 percent), solid waste (7 percent), water (5 percent), short-lived climate pollutants (3 percent), off-road transportation (2 percent), and wastewater (1 percent) (GCCOG, 2018).

Strategic Transportation Plan
The Strategic Transportation Plan (STP) aims to create an integrated transportation system for the 27 cities in the Gateway Cities Subregion. The STP brings together all elements of the transportation system in the Gateway Cities such as freeways, arterial highways, transit, and bikeways, into a unified vision. For many years, cities planned their roads independently. However, one city’s transportation improvements can negatively impact the surrounding cities. It highlights the importance of an integrated transportation system as it enables individual cities to understand how they fit within the larger region. The STP also evaluates air quality impacts, and stormwater treatment strategies, and presents preliminary freeway and arterial road designs for future consideration.

Central Basin Municipal Water District (CBMWD), Urban Water Management Plan (2020)
The CBMWD is a wholesale agency that provides imported and recycled water to almost 2 million people within southeast Los Angeles County, across 24 cities and several unincorporated areas. CBMWD imports water from the Metropolitan Water District (MWD), sourced from the State Water Project and the Colorado River Aqueduct, and supplies recycled water from the County’s Sanitation District’s treated wastewater, purchased from the San Jose Creek Water Reclamation Plant in the City of Whittier and the Los Coyotes Water Reclamation Plant in the City of Cerritos (CBMWD, 2020). The CBWD’s UWMP projects demand for recycled water use to increase ..

Item 11 Page 69 of 82
Existing
Conditions Report
32 steadily for municipal and industrial uses through 2045, especially with increasing costs around imported water.

The CBMWD identifies capital improvement projects for expanding the recycled water system, which are needed to address infrastructure challenges for increased use of recycled water. Currently, there are no CBMWD projects planned that would expand recycled water use in Vernon.

The CBMWD’s UWMP identifies climate change impacts of concern to the water system from extreme temperatures, precipitation pattern changes, sea level rise, and wildfires, including: reduced snowpack as water storage; reduced soil humidity and threatened soil permeability; reduced groundwater and downstream flows; increased flooding, storm surges, and runoff; threats to water quality due to flooding, runoff, dissolved oxygen levels, increased algal blooms and increased salinity concentrations; changes in vegetation cover; erosion; reduced potential of hydropower generation; changes to natural resources (sand, tide pools, wetlands); reduced availability of imported water deliveries, and; greater irrigation demands.

The CBMWD UWMP also provides water conservation strategies that include policies and programs regarding water waste prohibition, drought response planning, metering, conservation pricing, public education and outreach, residential/commercial/industrial/institutional programs and rebates, and landscape programs. There are also identified water shortage response actions during periods of severe drought or exceptional supply interruptions. During these periods, the CBMWD would implement water reductions based on the MWD’s regional efforts that include calls for water use reductions and greater use of storage reservoirs.

South Coast Air Quality Management District
The South Coast Air Quality Management District (AQMD) is the regional, regulatory agency responsible for improving air quality in Southern California. Its jurisdiction includes the counties of Los Angeles, Orange, Riverside, and San Bernardino. AQMD works to reduce emissions mainly from stationary sources, including power plants, refineries, and gas stations.

Rule 415
The AQMD adopted Rule 415 in 2017 to reduce odors from rendering facilities by requiring emission controls and best management practices for mitigating odors, and also required facilities to post signs with information to the public for making odor complaints. Rule 415 also requires rendering facilities to submit permit applications for installing permanent, total enclosures that seal processing areas to minimize leaks and odors.

There are five rendering facilities in the City, shown in Figure 6: Baker Commodities Inc.; Coast Packing Co.; Darling Ingredients Inc.; Legacy By-Products LLC (formerly D&D Disposal Inc. dba West Coast Rendering Co.), and; Smithfield Packaged Meats Corp (formerly Clougherty Packing LLC dba Farmer John). Four of the five (Coast, Darling, Legacy, and Smithfield) are implementing measures to be in compliance with Rule 415, however, the AQMD recently found Baker has failed to meet Rule 415 and has taken enforcement action due to permit and odor violations (AQMD, 2022a). ..

Item 11 Page 70 of 82
Existing
Conditions Report
33 Figure 6: Vernon Rendering Facilities
The City of Vernon does not oversee rendering facility compliance with Rule 415, however the City works with the AQMD to remain informed of rendering facility compliance and enforcement activities, and seeks to increase educational outreach of AQMD’s role in regard to enforcement activities. Additionally, the City is considering measures to help mitigate the impacts of rendering facilities within Vernon, including: • Plans to enact a moratorium on new rendering facility development in the City ;
• Working to modify City zoning to enable City Council to approve on a case-by-case basis new developments or operations that may impact quality of life in the region (including operations that emit excessive odors, noise, etc.);
• Working to coordinate Vernon Health & Environmental Control Department inspections that are aligned with requirements of Rule 415 and incorporate appropriate restrictions, and; • Plans to propose increased fines at the local level for rendering facilities that are not in compliance with Rule 415 (City of Vernon, 2022c).

Assembly Bill 617
The AQMD is implementing programs under AB 617 Community Air Monitoring for environmental justice communities, three of which are near the City of Vernon (South LA, Southeast LA, and East LA/Boyle Heights/West Commerce). AQMD is conducting air monitoring and implementing emission reduction plans in these communities to help reduce levels criteria pollutants and toxic air contaminants, mainly from nitrogen oxides (NOx) and diesel PM, respectively. The communities have set emission reduction targets for the next decade for both NOx and diesel PM. The communities of Southeast LA and East LA/Boyle Heights/West Commerce both identified pollution sources in Vernon as a concern to local air quality, particularly from trucks and freeways, railyards, metal processing, and rendering facilities. The Community Emissions Reductions Plans for both communities include several actions for the AQMD to implement that involve businesses and activities in Vernon, including to: conduct air monitoring near railyards, metal processing facilities, and rendering facilities; conduct facility inspections (rendering facilities) to evaluate compliance with Rule 415 and follow up with enforcement as necessary; provide trainings, best management practices, and pursue incentives for reducing emissions from metal processing; support transitions to zero-emission trucks; support enforcement for truck ..

Item 11 Page 71 of 82
Existing
Conditions Report
34 idling; and engage in public outreach and engagement for increasing community awareness of emissions (AQMD, 2022b).

AB 617 does not include the City of Vernon in its programs, however, because air quality and pollution is a regional issue, the AQMD expects local activities for air quality improvements in Southeast LA, South LA, and East LA/Boyle Heights/West Commerce will benefit other, nearby jurisdictions, including Vernon.

State
Cap-and-Trade
Launched in 2013, California's cap-and-trade program is the nation's first economy-wide GHG emissions market.

The program sets a limit on GHG emissions from power plants and other large industrial facilities that decline over time. Covered entities are issued annual emissions allowances, which can be bought and sold by companies depending on their needs. This effectively sets a price on carbon and creates an incentive for industries and businesses to reduce their emissions more efficiently.

Global Warming Solutions Act (AB 32 and SB 32) and California Climate Crisis Act (AB 1279)
AB 32 directs the state to reduce statewide GHG emissions to 1990 levels by 2020, while SB 32 deepens that commitment to 40 percent below 1990 levels by 2030. To achieve these reductions, the California Air Resources Board (CARB) and the state Office of Planning and Research recommend that local governments develop community-wide targets that are consistent with these statewide targets. Assembly Bill 1279, approved in September 2022, requires GHG emissions to be reduced to 85 percent below 1990 levels by 2045 to achieve state goals towards carbon neutrality. Senate Bill 350 Clean Energy and Pollution Reduction Act SB 350 seeks to increase use of solar, wind, geothermal and other renewable energy sources by expanding the state’s renewable electricity procurement goal to 50 percent by 2030 (from a previous 33 percent by 2020). The bill also establishes targets similar to SB 32, for reducing GHG emissions to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050. To implement SB 350, large utilities are required to develop integrated resource plans that describe how utilities plan to meet customer resource needs, reduce GHG emissions, and increase clean energy use. Senate Bill 100 Signed in 2018, Senate Bill 100 expands and accelerates the standards set by SB 350 by establishing a 100 percent clean, zero carbon, and renewable energy policy for the state’s electricity system by 2045, with mandatory renewable energy targets. It requires the state’s Renewables Portfolio Standard (RPS) to supply 50 percent of retail energy sales from renewable resources by 2026, and 60 percent by 2030. SB 100 directs the state to achieve carbon neutrality by 2045 and net negative emissions thereafter. ..

Item 11 Page 72 of 82
Existing
Conditions Report
35Senate
Bill 379
California SB 379 requires each city and county to address climate change by integrating climate adaptation and resiliency strategies in the safety element of its general plan and/or in its local hazard mitigation plan. The strategies in the updated plan must be based on a vulnerability assessment specific to the local geography.

Executive Order B-55-18
Executive Order B-55-18, signed by the Governor of California on September 2018, calls for the state to achieve carbon neutrality by 2045, exceeding the previous 2005 target of an 80 percent reduction from 1990 levels by 2050 (Executive Order S-3-05). California Air Resources Board (CARB) is tasked with leading the statewide planning effort to achieve these longer-term goals. CARB is updating the current Climate Change Scoping Plan to assess progress towards achieving the SB 32 2030 target and lay out a path for the State of California to achieve carbon neutrality before the mid-century.

Sustainable Communities and Climate Protection Act (SB 375) The Sustainable Communities and Climate Protection Act of 2008 (SB 375) supports the State's climate goals by helping reduce greenhouse gas emissions through coordinated transportation, housing, and land use planning. SB 375 targets greenhouse gas emissions from passenger vehicles as it instructs CARB to set regional reduction targets for passenger vehicles. It is the nation's first legislation to link transportation and land use planning with global warming.

Senate Bill 743 for reducing vehicle miles traveled (VMT) SB 743 took effect on July 1, 2020, and works with the California Environmental Quality Act (CEQA) to reduce pollution by prioritizing development and transportation projects that will decrease the use of individual cars. SB 743 aims to reduce air pollution and greenhouse gas emissions by reducing the number of vehicle miles traveled (VMT). CA Vehicle Emissions Regulations
California’s Short-Lived Climate Pollutant Reduction Strategy (SB 1383)
SB 1383, signed on September 2016, set methane emissions reduction targets for California in a statewide effort to reduce emissions of short-lived climate pollutants (SLCP). It focuses on the elimination of methane gas created by organic materials in landfills and requires that clean streams of organic material be collected, recovered, and recycled into new end-products like compost or biofuel. One of the targets aims to reduce 75 percent of organic waste disposal by 2025.

California’s water efficiency mandates (Assembly Bill 1668 and Senate Bill 606)
California Assembly Bill 1668 was enacted with a contingency on the passage ofSenate Bill 606. Both address water conservation and drought resilience across the state and were adopted in response to Governor Brown’s Executive OrderB-37-16- “Making Water Conservation a California Way of Life,” which directs permanent changes to use water more wisely, eliminate water waste, strengthen local drought resistance, and improve agricultural water use efficiency and drought planning. ..

Item 11 Page 73 of 82
Existing
Conditions Report
36 AB 1668 requires the State Water Resources Control Board (Board), in coordination with the Department of Water Resources (DWR), to adopt water efficiency standards and regulations, drought and water shortage contingency plan guidance, specified criteria for per capita daily indoor residential water use, and performance measures for commercial, industrial, and institutional water use.

Starting in 2027, local water suppliers will be penalized for violating these standards. For example, a local water supplier’s failure to comply with the Board’s adopted long-term standards could result in fines of $1,000 per day during non-drought years and $10,000 per day during declared drought emergencies and specific dry years.

California Adaptation Planning Guide
The California Adaptation Planning Guide (California APG) was recently updated in 2020 by the Governor’s Office of Emergency Services (Cal OES) to provide guidance to agencies and communities to engage in adaptation and resilience planning. It reflects the latest best practices, integrates recent State initiatives, and ensures the best available science and information. It includes a four-phase process, replicated in SCAG’s Regional Climate Adaptation Framework. The process provides step-by-step guidance for developing climate vulnerability assessments and adaptation strategies tailored to local jurisdictions, as well as integrating adaptation and resilience efforts with local policies and programs. The California APG also provides examples of real, local climate adaptation strategies by sector, including extreme heat, flooding, drought, wildfire and pollution, and pests and diseases.

California Green Building Code
The California Green Building Standards Code (CBSC), known as CALGreen, is the first-in-the-nation mandatory green building standards code. CALGreen aims to improve public health, safety, and general welfare through enhanced design and construction of buildings using concepts that reduce negative impacts while promoting positive environmental impacts and encouraging sustainable construction practices. CBSC has the authority to enforce CALGreen standards for nonresidential structures that include new buildings or portions of new buildings, additions, and alterations, and all occupancies where no other state agency has the authority to adopt green building standards applicable to those occupancies.

CARB’s Climate Change Scoping Plan Update (currently being updated)
The 2022 Scoping Plan Update currently in process will identify a cost-effective, equitable, and feasible path towards achieving carbon neutrality by 2045 or earlier while assessing progress towards achieving target GHG emissions reductions, as directed by SB 32, AB 1279, and the previous 2017 Scoping Plan. This Scoping Plan Update will address carbon neutrality for the first time, focusing on strategies for expanding clean energy options, improving air quality, reducing fossil-fuel dependency, increasing clean sector jobs, and supporting economic growth. The plan update will also address environmental justice, equity, and public health priorities. The Draft Plan is publicly available and undergoing environmental analysis. ..

Item 11 Page 74 of 82
Existing
Conditions Report
37 Attachment B – Policy Relevance of Local and Regional Initiatives to the ESAP Energy GHGs Air
Quality
Climate Change
Adaptation & Resilience
Green
Infra-
structure
Water Food Transportation
/VMT/Land
Use
Green BuildingGreen BusinessWaste
Local
Sustainability
Action Plan (2011)

XXXXXXX
General Plan (2015)XXXXX
Local Hazard
Mitigation Plan
(September 2022
Public Draft)
XXXXX
LA River Active
Transportation
Access (2020)
X
Bicycle Master Plan
(2017)
XX
LA River Path
Feasibility Study
(2017)
X
Westside Specific
Plan (in
development)
XXXX
Urban Water
Management Plan
(2020)
XX
Water Conservation
Ordinance (2009)
X
Urban Tree Canopy
Prioritization (2022)
XXX
Power Integrated
Resource Plan
(2018)
XX
Energy Storage
Evaluation Report
(2020)
X
Wildfire Mitigation
Plan (2022)
XX
Regional
LA OurCounty
(2019)

XXXXXXXXXXX
..

Item 11 Page 75 of 82
Existing
Conditions Report
38 Energy GHGs Air
Quality
Climate Change
Adaptation & Resilience
Green
Infra-
structure
Water Food Transportation
/VMT/Land
Use
Green BuildingGreen BusinessWaste
LA Climate
Vulnerability
Assessment (2021)
XXXXXX
LA River Master
Plan
XX
SCAG Regional
Climate Adaptation
Framework (2020)

XXXXXXX

SCAG RTP/SCS
(2020)
XX
Metro Blue Line
FLM Plan
XX
Metro LA River
Path Project
XX
Metro Rail to River
ATC
X
WSAB Transit
Corridor
X

GCCOG CAP
Framework (2018)

XXXXXXXXXX
GCCOG Strategic
Transportation Plan
X
Central Basin
Municipal Water
District UWMP
XX
ABBREVIATIONS:

SCAG = Southern California Association of Governments
RTP/SCS = Regional Transportation Plan/Sustainable Communities Strategy FLM = First/Last Mile
ATC = Active Transportation Corridor
WSAB = West Santa Ana Branch
GCCOG = Gateway Cities Council of Governments
UWMP = Urban Water Management Plan ..

Item 11 Page 76 of 82
Existing
Conditions Report
39 Attachment C – Targets and Actions of the 2011 Sustainability Action Plan Target Actions
Energy Efficiency
Reduce GHG emissions generated from City
operations 15% by 2020.

A) As they are refurbished, all City buildings will be retrofitted to meet green building energy standards.

B) Install energy management devices on City buildings that reduce the power required to operate equipment and shift equipment usage to off-peak hours.

C) Replace incandescent lamps with compact fluorescent lamps in City building lamps in City buildings and facilities.

D) Implement accounting system and continue annual quantification and systematic reduction of greenhouse gas emissions generated by City operations and services.

Utilize at least 33% renewable power in City
facilities by 2020.

A) Procure or develop renewable sources of energy for use by the City.

B) Develop a remote wind energy project to generate renewable power.

Continue to encourage the installation of
renewable power sources by the City’s
businesses
Continue to offer Vernon businesses monetary incentives to finance eligible solar projects.

Continue to install renewable power sources
for City facilities
Phase in the use of solar-powered area and street lighting.

Continue to minimize the energy used to
pump water to the City’s water utility
customers.

Evaluate the pumping efficiency of water wells and booster pumps and replace failed water pump motors with high- efficiency motors.

Minimize the ‘heat island effect. Encourage the installation of ‘cool roofs’ and ‘green walls By 2020, assist at least 100 businesses to
establish their GHG baseline and reduce GHG
emissions generated from their business
operations.

Continue to provide sustainability technical assistance to local businesses Provide technical business assistance and
target specific industries.

Encourage the refrigeration industry to use more environment-friendly refrigerants and participate in the EPA’s Greenchill program
Enhance community awareness. Provide sustainable web-based resources, workshops, and events to local businesses.

Enhance staff awareness. Provide staff with training and educational materials on energy efficiency.

Transportation and Land Use
Reduce vehicle trips by the City’s workforce
5% by 2020
A) Promote Rideshare programs among the City’s employees.

B) Encourage the use of van pools and carpool programs and public transit passes among the City’s employees.

C) Provide preferential parking spaces for vanpool /carpool vehicles, and bicycles for City staff.

Reduce emissions from private vehicles used
by City staff 5% by 2020.

Consider the development of an incentive-financing program for employees that purchase hybrid or clean fuel, low- emission vehicles
Reduce emissions from City-operated vehicles
25% by 2020.

A) As existing non-emergency fleet vehicles come to the end of their useful lives, replace them with clean-fuel, low-emission vehicles.

B) Evaluate new technologies and fuels to reduce carbon emissions.

C) Evaluate, on a case-by-case basis, to promote and test new technologies and fuel options such as using CNG, bio-fuel, propane, electric plug-in and hydrogen cell vehicles.

D) Conduct fleet size and utilization study for City fleet vehicles. ..

Item 11 Page 77 of 82
Existing
Conditions Report
40 Target Actions
E) Pursue viable grant funding opportunities for purchasing alternative fuel vehicles, installing advanced emission control devices for City-owned/operated fleet vehicles.

F) Install a CNG filling station, convert City vehicles to CNG, and use City-provided natural gas to power City vehicles.

Water Protection and Conservation
Develop and implement programs to decrease
potable water consumption 15% by 2020.

A) Evaluate the viability of implementing a “Recycled Water Master Plan”.

B) Install durable water-saving fixtures and devices.

C) Install weather-based irrigation controllers and landscape with drought-resistant plants.

Continue to protect water quality. A) Continue to implement a plan to minimize the City’s use of hazardous chemicals or materials for maintenance and operational purposes.

B) Require City contractors and service providers to use lower-toxicity or non-toxic chemicals, or eliminate them completely for cleaning and pest control measures on City facilities Continue to reduce stormwater pollution at the
source.

Require contractors to implement erosion and sediment enforcement control measures on renovation and construction projects.

Waste Resources Management
Achieve zero waste sent to landfills by 2020. Develop a ‘Zero Waste-to-landfill Plan.

Develop and implement mandatory recycling
ordinance to ensure that all businesses
participate in recycling.

Meet with representatives of businesses and haulers to outline provisions of the ordinance.

Implement mandatory commercial recycling
ordinance (finalize after adoption of
regulations by CalRecycle).

Adopt mandatory recycling ordinance.

Develop documentation needed for
demonstration of compliance with the State
mandatory commercial recycling law.

Gather data from haulers and develop recycling database of all businesses in Vernon.

Develop Environmental Preferred Purchasing
Policy that incorporates incentives for
extended manufacturers’ responsibility.

Adopt and implement an “Environmental Preferred Purchasing Policy” addressing “green” services and products (i.e., repairable, long life, energy star rated equipment, post-consumer recycled content, sustainability-produced, non-toxic and chemical free).

Research product certifications (e.g., Green
Seal, etc.) and other product and packaging
evaluation protocols to determine which
environmentally preferred products the City
should purchase.

A) Develop and utilize a product evaluation protocol to compare environmentally preferred products purchased for use by the City.

B) Expand existing waste prevention and waste minimization programs.

Work with franchised haulers to implement
additional recycling programs targeted to non-
traditional materials.

Expand the City recycling program to include additional materials.

Develop sustainability product design
purchasing preference policy and program as
part of the Environmental Purchasing Plan.

Encourage vendors to design safe, long lasting, repairable, and recyclable products and to take back products at the end of their useful life.
..

Item 11 Page 78 of 82
Existing
Conditions Report
41 Target Actions
Work with existing haulers and recyclers to
site and/or expand recycling facilities in the
City.

Encourage and provide incentives for recyclers to locate within the City. Promote and encourage local business community to utilize their services.

Expand the waste reduction and recycling
technical assistance resources provided to
businesses.

Actively promote and provide sustainability technical assistance programs to more businesses on an as-requested basis in addition to the City’s business outreach program.

Identify “best management practices” to serve
as examples to other Vernon businesses.

Create best management “case studies” of exemplary environmental practices from businesses in the City.

Reduce the City’s use of office paper. Continue the practice of double-sided copying. Continue the transition to a more ‘paperless’ office by storing more information on Laserfiche.

Minimize disposal of universal waste and
electronic wastes and maximize recovery of
recyclables portions of these specific streams.

Continue the City’s recycling program for electronics and universal wastes and support product take-back programs and policies that reduce or eliminate product toxic contents. ..

Item 11 Page 79 of 82
References
Cal-Adapt. 2021. Local Climate Change Snapshot for Vernon. Selected indicators for temperature and precipitation under high emissions scenario (RCP 8.5). Available: https://cal- adapt.org/tools/local-climate-change-snapshot.

California Department of Resources Recycling and Recovery (CalRecycle). 2022. Solid Waste Characterization. Exported data for commercial waste streams by business groups and material type for the City of Vernon. Available:
https://www2.calrecycle.ca.gov/WasteCharacterization/.

California Office of Environmental Health Hazard Assessment (OEHHA). 2021.

CalEnviroScreen 4.0. Available: https://oehha.ca.gov/calenviroscreen.

Central Basin Municipal Water District (CBMWD). 2020. Urban Water Management Plan. June 2021. Available:
https://centralbasin.hosted.civiclive.com/common/pages/DisplayFile.aspx?itemId=1783214 1.

City of Vernon. 2009. Ordinance No. 1161. Executed October 27, 2009. Available:
https://www.cityofvernon.org/home/showpublisheddocument/670/637619845786600000. ———. 2021a. 2020 Urban Water Management Plan (UWMP), Volume 1 – Final Report. June 15, 2021.
———. 2021b. 2021 Solid Waste Tonnage Report.
———. 2022a. Greenhouse Gas Inventory Management Plan. September 2007. Updated July 2022. Jacobs Engineering Group Inc.
———. 2022b. Local Hazard Mitigation Plan (LHMP), Public Review Draft. September 6, 2022.
———. 2022c. Rendering Operations. Available: https://www.cityofvernon.org/government/city- administration/rendering.

City of Vernon Public Utilities (VPU). 2018. Integrated Resource Plan. November 20, 2018. ———. 2022. Wildfire Mitigation Plan. Version 3.0. Effective Date: 8/16/2022. Available:
https://www.cityofvernon.org/home/showpublisheddocument/2683/637964368963930000.

County of Los Angeles (LA County). 2019. OurCounty, Los Angeles Countywide Sustainability Plan. Available: https://ourcountyla.lacounty.gov/wp-content/uploads/2019/07/OurCounty- Final-Plan.pdf.

FEMA. 2021. National Flood Hazard Layer (NFHL) Status. Available:
https://www.floodmaps.fema.gov/NFHL/status.shtml.
..

Item 11 Page 80 of 82
Existing
Conditions Report
43 Gateway Cities Council of Governments (GCCOG). 2018. Climate Action Planning Framework.

Available: https://www.gatewaycog.org/initiatives-and-projects/air-quality/climate-action- planning-framework.

Los Angeles County Metropolitan Transportation Authority (Metro). 2019. Conceptual Design Report, LA River Path. September 2019. Available:
https://www.dropbox.com/sh/3aog0rbm3jndazm/AABOoA9Ft7PC9NuzddM82Bv7a/Repor ts/LA%20River%20Path%20Conceptual%20Design%20Report?dl=0&preview=190912_L AR_Concept_Design_Report_Final.pdf&subfolder_nav_tracking=1.

Loyola Marymount University, Center for Urban Resilience (LMU CURes). 2022. Final Report, City of Vernon Tree Canopy Prioritization. September 2022. Available:
https://www.gatewaycog.org/media/userfiles/subsite_9/files/urban_tree/Vernon%20Tree% 20Canopy%20Prioritization%20Final%20Report.pdf.

National Integrated Drought Information System (NIDIS). 2022. Drought Conditions for Los Angeles County. November 15, 2022. Available:
https://www.drought.gov/states/California/county/Los%20Angeles.

Open Charge Map. 2022. Open Charge Map for Vernon, California, United States. Available:
https://openchargemap.org/site.

Reimagine Vernon. 2022. About the Westside Specific Plan. Available:
https://www.reimaginevernon.com/about.

South Coast Air Quality Management District (AQMD). 2022a. Press Release: Rendering Facility in Vernon Ordered to Shut Down for Failing to Comply with Permit Requirements and Reduce Odors. September 30, 2022. Available: http://www.aqmd.gov/docs/default- source/news-archive/2022/baker-oa-sep30-2022.pdf?sfvrsn=9. ———. 2022b. AB 617 Community Air Initiatives. Community Emissions Reduction Plan for AB 617 communities of East Los Angeles/Boyle Heights/West Commerce (2019) and Southeast Los Angeles (2020). Available:
http://www.aqmd.gov/nav/about/initiatives/environmental-justice/ab617-134.

Southern California Association of Governments (SCAG). 2020. Southern California Climate Adaptation Planning Guide. October 2020. Available:
https://scag.ca.gov/sites/main/files/file-
attachments/socaladaptationplanningguide_oct2020_0.pdf?1619029039.

United States Census Bureau. 2020. American Community Survey. Available:
https://data.census.gov/.

Vernon Chamber of Commerce. 2022. Vernon, An Economic Engine. Available:
https://www.vernonchamber.org/about-vernon/an-economic-engine/. ..

Item 11 Page 81 of 82
54 Table of Contents ..

Item 11 Page 82 of 82
City Council Agenda Report
Meeting Date: February 6, 2024
From: Zaynah Moussa, City Attorney
Department: City Attorney
Submitted by: Eva Muro, Legal Analyst
Subject
Best Practices for Ballot Measure and Campaign Activities for Local Government Officials Recommendation
Receive overview of permissible and prohibited uses of public resources for campaign purposes.

Background
A General Municipal Election will be held on Tuesday, April 9, 2024, for the election of one member of the City Council and to submit a ballot measure to the voters to establish a transient occupancy tax. In light of the upcoming election and in an effort to ensure legal compliance and best practices through regular City training sessions, the City Attorney’s Office will present a brief overview of campaign “do’s and don’ts” for local government officials and employees.

Ballot measures are proposed pieces of legislation that are either approved or rejected by voters rather than a legislative body. State law regulates the actions public agencies and officials can take regarding ballot measures and campaign activities. The key rule is that public resources may not be used for campaign activities but may be used for informational activities.

The distinction is that campaign activities supporting or opposing a ballot measure are prohibited, while informational activities providing objective facts or context are permissible. Before taking any action on a campaign issue, we should ask ourselves whether the communication or activity is “express advocacy” (prohibited) or “impartial information” (permissible).

Ballot Measure Communications
California case law recognizes that public officials have free speech rights that they are entitled to exercise in their individual capacities, while voters are entitled to a fair election process that is free of undue influence. Cf. Fort v. Civil Service Com. (1964) 61 Cal.2d 331, 334; Stanson v.

Mott (1976) 17 Cal.3d 206, 209 (noting that the use of public funds in election campaign can lead to an “improper distortion of the democratic electoral process”). Restrictions on campaign-related activities also depend on timing, whether the communication is made before or after the election is officially called.

Generally, individual Councilmembers have free speech rights and are not legally restricted in expressing their positions on a proposed measure in their individual capacities. They should, however, refrain from making comments or taking a position that indicates prejudgment or bias before voting on whether to adopt a proposed measure or to place it on the ballot. After a measure is placed on the ballot, California law restricts the use of public funds for campaign-related activities unless it is clearly authorized by law.

The City Council as a whole is authorized to take a position on a ballot measure, enact resolutions endorsing or opposing the measure, and may submit ballot arguments for or against the measure. However, other than official actions permitted by law or informational activities, the City and its officials may not use public funds to campaign for or against the ballot measure or ..

Item 12 Page 1 of 16
communicate in a manner that indicates express advocacy for a specific position. Such misuse of public resources may result in potential criminal or civil penalties and is an area of focus for enforcement by the Fair Political Practices Commission (FPPC).

Individual Councilmembers may still advocate their personal views after the measure is placed on the ballot, but should identify that they are acting in a personal capacity and must refrain from such advocacy on City time or by using City resources.

Examples of permissible ballot measure communications include: • A City may use public resources to draft and propose a proposed ballot measure. • A City may spend public funds to research potential provisions of a ballot measure and take the procedural steps necessary to get it on the ballot with the use of public funds, including holding public study sessions.
• Factual responses to a request for information. • Presentation of the City’s view on the ballot measure in an open meeting. • Posting reports prepared by City departments analyzing the effect of the ballot measure. • Pamphlets urging voters to vote without expressing how they should vote. • Councilmembers and the City Council as a whole may announce their position on a measure at a public meeting or within the agenda or hearing minutes prepared for the meeting.
• An agency may use public resources to prepare a written argument filed by the agency for publishing in the voter information pamphlet.
• Any City department may present a departmental view presented by an agency employee upon request by a public or private organization, at a meeting of the organization. • Individual employees and Council members may work on the campaign, including attending campaign events, campaign appearances, and campaign fundraisers, during their personal time. Their personal time includes lunch hours, coffee breaks, vacation days, and their time before or after work.

Examples of impermissible campaign activities or communications include: • Advocating their position on a measure during official duties, on City time, or in City uniform.
• Public funds may not be used to fund signature gathering to qualify a measure for the ballot.
• Funding advertising-related items such as bumper stickers, posters, floats, television and radio spots that advocate a position.
• Funding campaign literature prepared by private proponents or opponents of the ballot measure.
• Funding express messages advocating a position for a measure. • Officials may not promise to provide any person with a gift, money, promotion, job, or other forms of compensation in return for a contribution or vote.

Endorsement of Ballot Measures and Council Candidates
Officials may give endorsements of their choosing on a personal level and may include their public official title in such endorsements. CA FPPC Adv. Letter I-00-216. This applies both to endorsement of a Council candidate or ballot measure. However, they may not use any City resources to advocate or endorse measures or candidates, which includes using public funds to purchase a ticket to a campaign event or fundraiser. Officials may donate to the campaign of a ..

Item 12 Page 2 of 16
Council candidate in the manner allowed by Government Code Sections 85301 and 85702.5.

Any endorsement by an individual Councilmember cannot suggest that they are representing the City Council as a whole or be filmed, written, or funded using public funds.

This overview provides a brief summary of legal standards, please contact the City Attorney for additional resources or for questions regarding specific facts and circumstances.

Fiscal Impact
There is no fiscal impact associated with this report.

Attachments
None.
..

Item 12 Page 3 of 16

BEST PRACTICES - BALLOT MEASURE

AND CAMPAIGN ACTIVITIES FOR

GOVERNMENT OFFICIALS
February 6, 2024
February 6, 2024
Item 12
Staff Presentation
..

Item 12 Page 4 of 16
BROAD DON’Ts AND NARROW DOs • Limits on ballot measure and campaign activities • Information vs. Advocacy
• What not to do • Enforced by FPPC • What .
can cities do to get the message out?
.

Item 12 Page 5 of 16
BALLOT MEASURES • Form of “direct democracy” • Not intended as a substitute for legislation, but as a safeguard for voters to retain power themselves and
hold the legislature in check
• Regulations come from the concept that public
agencies and officials should not be allowed to
unfairly influence voter-led measures
..

Item 12 Page 6 of 16
RESTRICTION ON UNFAIR INFLUENCE • Without statutory authorization, public agencies cannot use public funds to influence voters for or against a
measure • Goes back to the concept that voters retain the power in direct democracy
• “The selective use of public funds in election
campaigns, of course, raises the specter of an improper distortion of the electoral process[.]” Stanson v. Mott ..

Item 12 Page 7 of 16
• Government Code Section 8314 • A local agency officer, employee or consultant may not spend or authorize the expenditure of public funds
to support or oppose a candidate or ballot measure
• Exception– “fair and impartial presentation of relevant facts to aid the electorate in reaching an informed
judgment” in communications otherwise permitted by law
• Applies to employees and consultants as well as elected officials ..

Item 12 Page 8 of 16
Government Code Section 54964 • A local agency officer, employee or consultant may not expend or authorize the expenditure of
public funds to support or oppose a ballot
measure or candidate • Clearly defined measure or candidate (timing matters)
• Misdemeanor
..

Item 12 Page 9 of 16
FPPC Reg. 18420.1
A communication “expressly advocates” the nomination,
election, or defeat of a candidate or the qualification, passage, or defeat of a measure if it contains express words of advocacy such as “vote for”, “elect”, “support”, “cast your ballot”, “vote against”, “defeat”, “reject”, “sign petitions for” or otherwise refers to a clearly identified candidate or measure so that the communication, taken as a whole, unambiguously urges a particular result in an election.
..

Item 12 Page 10 of 16
Express Advocacy Impartial Information
“Vote Yes/No” Factual w/ attribution
Result oriented Both sides of the issue
One-sided, emotional Widely disseminated (not voters only) Targets (certain voters) Consistent with regular communications Timed towards election Consistent style
Special appropriation ..

Item 12 Page 11 of 16
PROHIBITED USES OF PUBLIC RESOURCES • Production/printing of campaign literature • Campaigning on City time, in uniform, or with agency resources • Using City devices or email addresses for campaign communication activities
• Mass mailings containing advocacy at public expense • Funding express messages or advertising that advocate a position
• Broad catchall prohibition ..

Item 12 Page 12 of 16
PERMISSIBLE USES OF PUBLIC RESOURCES • Adopt a resolution of support/opposition for measures • Researching and drafting a measure • Pre-measure polling • Providing a factual report • Voter registration and unbiased get-out-the-vote efforts • Workshop sessions with factual information • Make staff available to respond to requests for information ..

Item 12 Page 13 of 16
INDIVIDUAL ACTIONS • Employees and officials can campaign on personal time and with personal resources
• You may sign arguments, work on campaign committees • You may use your title for identification purposes only • No campaigning in City uniform • City Council as a whole may adopt a resolution in support or opposition, as an item on the agenda
• No campaigning from the dais or in City facilities ..

Item 12 Page 14 of 16
IN SUMMARY • It is a fine line between impartial information and advocacy • Campaign on your own time, with your own resources • When in doubt, the FPPC will probably say it’s advocacy • The personal stakes are high (criminal and financial penalties, disqualification or termination)
• Consult with the City Attorney in advance ..

Item 12 Page 15 of 16
Thank you and please reach out with any questions.

Office of the City Attorney
Zaynah Moussa
[email protected]
(323) 583-8811 x893
..

Item 12 Page 16 of 16