Yorba Linda City Council
August 6, 2024

EXHIBIT A

MANAGEMENT STEP A STEP B STEP C STEP D STEP E
Administrative Services Director 13,793 14,483 15,207 15,968 16,766 Assistant City Manager 16,671 17,504 18,379 19,298 20,263 City Manager 1 25,547 --- --- --- ---
Community Development Director 14,964 15,712 16,498 17,323 18,189 Finance Director 15,116 15,872 16,666 17,499 18,374
Library Director 13,793 14,483 15,207 15,968 16,766
Parks and Recreation Director 14,328 15,045 15,797 16,587 17,416 Public Works Director/City Engineer 15,788 16,578 17,407 18,277 19,191 1 Contract salary effective July 1, 2024

CITY OF YORBA LINDA
2024/25 SALARY SCHEDULE
EFFECTIVE: JULY 1, 2024

FINANCE DEPARTMENT
DATE: AUGUST 6, 2024
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: DAVID CHRISTIAN, ASSISTANT CITY MANAGER/INTERIM FINANCE

DIRECTOR
SUBJECT: FISCAL YEAR 2024/25 INVESTMENT POLICY

RECOMMENDATION
It is recommended that the City Council approve the revisions to the Investment Policy for Fiscal Year 2024/25.

BACKGROUND
Effective January 1, 2006, Section 53646(a)(2) of the Government Code was modified to allow local agencies the option of adopting an annual Investment Policy or to adopt an Investment Policy that would remain in effect until changed. In June 2006, the City Council opted to adopt an Investment Policy each year, regardless of whether it changed or not.

On July 23, 2024, the proposed revisions to the Fiscal Year 2024/25 Investment Policy were reviewed by the Finance Committee and are being recommended for approval by the full City Council.

DISCUSSION
The City’s investment management consultant, PFM Asset Management, reviewed the City’s Investment Policy as part of the City’s annual review process. While the Policy is consistent with the applicable California Government Code sections regulating the investment of public funds, they are recommending two changes to the Policy as follows.

The first change is an update to the language in Section IV.F.3 Local Government Investment Pools (Pg. 6), to allow the City to invest in the California Asset Management Program’s (CAMP) Term Pool. As a compliment to CAMP’s floating rate, short-term liquidity pool (which is already a part of the City’s investment portfolio); CAMP recently created a new pool program, CAMP Term, that offers fixed-rate, fixed-term investments. Using CAMP Term, local agencies can buy investments with maturities ranging from 60 days to one year.

While CAMP Term seeks to maintain a stable net asset value at maturity, its share price prior to maturity can vary. CAMP Term is rated AAAf by Fitch.

FISCAL YEAR 2024/25 INVESTMENT POLICY
P a g e | 2
The second change is an update to the language in Section IV.F.12 Asset Backed Securities (Pg. 8), to incorporate a recent Code change that took effect January 1, 2024. Senate Bill 882, Local Government Omnibus Act of 2023, made various minor edits to state statutes, including a change to Code Section 53601(o). The Bill clarified that mortgage-backed securities issued by federal agencies are excluded from the Code’s requirements described is Section 53601(o) for privately issued asset- and mortgage-backed securities. The change does not otherwise modify the Code’s or the Policy’s requirements for the purchase of assetbacked securities.

FISCAL IMPACT
There is no direct fiscal impact associated with approving the Investment Policy.

ALTERNATIVES
Do not approve the updated Investment Policy at this time and provide further direction to staff.

ATTACHMENTS
Proposed City Council Policy F-10 for Fiscal Year 2024/25 (red line version)

C I T Y C O U N C I L P O L I C I E S
POLICY: INVESTMENT POLICY
Number: F-10 Issue Number: 19
Page: 1 Date Adopted: June 20, 2023
Replaces: June 210, 20223
I. PURPOSE
To establish guidelines for the prudent investment of public funds in a manner that will protect City funds, meet daily cash flow expenditures, and comply with all federal, state, and local laws and ordinances governing the investment of public funds.

II. BACKGROUND
Effective January 1, 2006, Section 53646(a)(2) of the Government Code was modified to allow local agencies the option of adopting an annual Investment Policy or to adopt an Investment Policy that would remain in effect until changed. In June 2006, the City Council opted to adopt an Investment Policy each year, regardless of whether it changed or not.

III. POLICY
It shall be the policy of the City of Yorba Linda to annually review and adopt an Investment Policy. This Policy applies to all financial assets and funds held by the City of Yorba Linda and the Successor Agency to the Yorba Linda Redevelopment Agency. All Funds reflected in the City’s Annual Comprehensive Financial Report are subject to this policy, including any new funds that are created, unless specifically exempted by the City Council.

Retirement-related funds in a trust and bank deposits (governed under the California Government Code’s “Deposit of Funds” provisions) are excluded from this Policy’s requirements.

IV. PROCEDURES
The City Treasurer shall annually review the City’s Investment Policy, and incorporate any changes in state law, recommendations from the City’s Investment Advisor, recommendations from the various national and state organizations of municipal finance officers, or other changes recommended by City staff. The revised Investment Policy shall be presented to the Finance Committee and the City Council for review and approval. (A) Responsibilities
No person may engage in investment activities except as provided under the terms of this Policy and the procedures established by the City Treasurer.

1. Responsibilities of the City Council
The City Council shall annually consider and adopt a written Investment Policy.

As provided in this Policy, the Council shall receive monthly City Treasurer Reports and the annual Investment Policy.

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Number: F-10 Issue Number: 19
Page: 2 Date Adopted: June 20, 2023
Replaces: June 210, 20223

2. Responsibilities of the Finance Director / City Treasurer The Finance Director is appointed by and serves at the pleasure of the City Manager and is subject to his or her direction and supervision. The Finance Director is charged with responsibility for the conduct of all Finance Department functions.

The City Treasurer is appointed by the City Council and is charged with responsibility for carrying out all investment actions. The City Council has historically appointed the Finance Director to also serve as City Treasurer, and at least annually delegates its authority to invest and reinvest the City’s funds and to sell or exchange purchased securities to the City Treasurer in accordance with Government Code Section 53607. The City Treasurer may delegate the day-to-day investment activities to his/her designee(s) but not the responsibility for the overall investment program. If authorized by the City Council, the City Treasurer may also utilize the services of an external investment advisor to assist with the investment program.

3. Responsibilities of the City Manager
The City Manager is responsible for keeping the City Council fully advised as to the financial condition of the City.

4. Responsibilities of the Finance Department
Under the supervision of the Finance Director / City Treasurer, the Finance Department is charged with the responsibility for managing all public funds and securities belonging to or under the control of the City and Successor Agency and for the deposit and investment of those funds in accordance with principles of sound treasury management and applicable laws and ordinances.

Appropriate internal controls designed to ensure that assets of the City are protected from loss, theft, or misuse, including but not limited to separation of duties and multiple approvers for transactions, shall be maintained at all times in order to safeguard the City’s assets.

5. Responsibilities of the City’s Investment Advisor
Should the City determine that it is appropriate to engage a firm to manage the City’s investment portfolio, the Investment Advisor shall invest the City’s funds in investments that are in compliance with this policy and provide accurate and

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timely reports of its investment activities to City staff. The Investment Advisor shall never take possession of the City’s funds or assets.

6. Responsibilities of the City’s Auditing Firm
The City’s auditing firm’s responsibilities shall include, but are not limited to, the examination and analysis of fiscal procedures and the examination, checking, and verification of accounts, revenues, and expenditures. A review of the City’s investment program is a part of this responsibility. (B) Prudent Investor Rule
The City of Yorba Linda makes its cash investments under the prudent investor rule (Government Code Section 53600.3), which states, in essence, that in investing and managing property, a trustee shall act with the care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the City, that a prudent person acting in a like capacity and familiar with those matters would use in conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the City. Within the limitations of the Government Code and considering individual investments as part of an overall strategy, investment may be acquired as authorized by law.

This affords the City a broad spectrum of investment opportunities as long as an investment is deemed prudent as is allowable under the current laws of the State of California.

The City Treasurer and other individuals assigned to manage the investment portfolio, acting in accordance with state law and the intent and scope of the Investment Policy and other written procedures and exercising due diligence, shall be relieved of personal responsibility and liability for an individual security’s credit risk or market price changes, provided deviations from expectations are reported in a timely manner and appropriate action is taken to control adverse developments.
(C) Ethics and Conflicts of Interest
Officers and employees involved in the investment process shall refrain from personal business activity that conflicts with proper execution of the investment program or impairs their ability to make impartial investment decisions.

Additionally, the City Treasurer, other employees designated in the City’s conflict of interest code, and the City’s Investment Advisor, if one is used, are required to annually file applicable financial disclosures as required by the Fair Political

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Practices Commission (FPPC) and are subject to California law relative to conflicts of interest.
(D) Level of Investment
The City strives to maintain the level of investment of all investable cash as near to 100 percent as possible through current and projected cash flow management.

The City Treasurer shall maintain a system to monitor and forecast revenues and expenditures so that City funds can be invested to the fullest extent possible while providing sufficient liquidity to meet the City’s reasonably anticipated cash flow requirements. Maturities of investments will be selected to provide necessary liquidity, manage interest rate risk, and optimize earnings. Because of inherent difficulties in accurately forecasting cash flow requirements, a portion of the portfolio should be continuously invested in readily available funds. (E) Investment Criteria
The City seeks safety and liquidity in all of its investments followed by yield.

Safety, liquidity, and yield are defined as follows:

1. Safety. Safety of principal is the foremost objective of the investment program. Investments shall be undertaken in a manner that seeks to ensure the preservation of capital in the overall portfolio.

2. Liquidity. The investment portfolio shall remain sufficiently liquid to meet operating requirements that may be reasonably anticipated. This is accomplished by structuring the portfolio so that securities mature concurrent with cash needs to meet anticipated demands.

3. Yield. The investment portfolio shall be designed with the objective of attaining a market rate of return, taking into account the investment risk constraints and liquidity needs. Return on investment is of secondary importance compared to the safety and liquidity objectives described above.
(F) Allowable Investments
Sections 53601 & 16429.1 of the California Government Code govern allowable investments. The City shall not invest in any investment authorized by the Government Code, but not explicitly listed in this Policy without the prior approval of the City Council. In the event that an apparent discrepancy is found between this Policy and the Government Code, the more restrictive parameters will take

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Page: 5 Date Adopted: June 20, 2023
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precedence. If collateral is required for a particular investment type, it will be provided in compliance with California Government Code requirements.

Furthermore, the City will not invest in inverse floaters, range notes, mortgagederived, interest-only strips, or any security that could result in zero interest accrual if held to maturity. Prior to investing in any pooled investment program (e.g., LAIF, LGIPs, mmfs), the City Treasurer should review the program’s documentation (e.g., investment policy, policies for participation, fees) to determine the appropriateness of the pool for City funds. Whenever the City has funds invested in a pooled investment program, the City Treasurer should periodically review the pool’s investment holdings.

The City shall diversify the investments within the portfolio to avoid incurring unreasonable risks inherent in over-investing in specific instruments, individual financial institutions, or maturities. To promote diversification, no more than 5% of the portfolio may be invested in the securities of any one issuer, regardless of security type; excluding U.S. Treasuries, federal agencies, supranationals, and pooled investments such as LAIF, money market funds, or local government investment pools.

Credit ratings, where shown specify the minimum credit rating category required at purchase. For purposes of this Policy, the minimum rating will be determined by the lowest rating by Standard & Poors, Moody’s or Fitch. In the event that an investment originally purchased within Policy guidelines is downgraded below the Policy requirements, the course of action to be followed by the City Treasurer will then be decided on a case-by-case basis, considering such factors as the reason for the downgrade, prognosis for recovery of further rating downgrades, and the market price of the security.

The weighted average duration of the investment portfolio shall not exceed 3.0 years. For those investment types for which this Policy does not specify a maturity limit, no individual investment shall exceed a maturity of five years from the date of purchase unless the City Council has granted express authority to make that investment either specifically or as a part of an investment program approved by the City Council no less than three months prior to the investment.

The following types of investments are authorized by this Policy:

1. U.S. Treasury Instruments. United States Treasury notes, bonds, bills, or certificates of indebtedness, or those for which the faith and credit of the United States are pledged for the payment of principal and interest.

There is no limitation as to the percentage of the City’s portfolio that may be invested in this category.

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POLICY: INVESTMENT POLICY
Number: F-10 Issue Number: 19
Page: 6 Date Adopted: June 20, 2023
Replaces: June 210, 20223

2. State of California’s Local Agency Investment Fund (LAIF). A State of California-managed investment pool. The maximum amount invested in this category may not exceed the limit set by LAIF for operating accounts.

3. Local Government Investment Pools (“LGIP”). Shares of beneficial interest issued by a joint powers authority organized pursuant to Section 6509.7 that invests in the securities and obligations authorized in Government Code. The City will limit investments to LGIPs that seek to maintain a stable net asset value. There is no limitation as to the percentage of the City’s portfolio that may be invested in this category.

4. Municipal Debt. Registered state warrants or treasury notes or bonds of this state, including bonds payable solely out of the revenues from a revenue-producing property owned, controlled, or operated by the state or by a department, board, agency, or authority of the state.

Registered treasury notes or bonds of any of the other 49 states in addition to California, including bonds payable solely out of the revenues from a revenue-producing property owned, controlled, or operated by a state or by a department, board, agency, or authority of any of the other 49 states, in addition to California.

Bonds, notes, warrants, or other evidences of indebtedness of a local agency within this state, including bonds payable solely out of the revenues from a revenue-producing property owned, controlled, or operated by the local agency, or by a department, board, agency, or authority of the local agency.

Purchases are limited to securities rated in a rating category of “A” (longterm) or “A-1” (short-term) or their equivalents or better by an NRSRO. A maximum of 30% the City’s portfolio may be invested in this category.

5. Federal Agency Securities. Federal agency or United States government-sponsored enterprise obligations, participations, or other instruments, including those issued by or fully guaranteed as to principal and interest by federal agencies or United States government-sponsored enterprises. There is no limitation as to the percentage of the City’s portfolio that may be invested in this category.

6. Negotiable Certificates of Deposit. Negotiable certificates of deposit issued by a nationally or state-chartered bank, a savings association or a

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federal association, a state or federal credit union, or by a federally licensed or state-licensed branch of a foreign bank. Purchases are limited to securities rated in a rating category of “A” (long-term) or “A-1” (short-term) or their equivalents or better by an NRSRO. A maximum of 30% the City’s portfolio may be invested in this category.

8. Commercial Paper. Commercial paper of “prime” quality of the highest ranking or of the highest letter and number rating as provided for by a nationally recognized statistical rating organization (NRSRO). The entity that issues the commercial paper shall meet all of the following conditions in either paragraph (1) or (2):
(1) The entity meets the following criteria: (A) Is organized and operating in the United States as a general corporation; (B) Has total assets in excess of five hundred million dollars
($500,000,000), and (C) Has debt other than commercial paper, if any, that is rated in a rating category of “A” or its equivalent or better by an NRSRO.
(2) The entity meets the following criteria: (A) Is organized within the United States as a special purpose corporation, trust, or limited liability company, (B) Has program-wide credit enhancements including, but not limited to, overcollateralization, letters of credit, or a surety bond, and (C) Has commercial paper that is rated “A-1” or better, or the equivalent, by an NRSRO.

Purchases are limited to securities that have a maximum maturity of 270 days. A maximum of 30% the City’s portfolio may be invested in this category.

9. Medium-Term Notes. Medium-term notes, defined as all corporate and depository institution debt securities with a maximum remaining maturity of five years or less, issued by corporations organized and operating within the United States or by depository institutions licensed by the United States or any state and operating within the United States.

Purchases are limited to securities rated in a rating category of “A” or its equivalent or better by an NRSRO. A maximum of 30% the City’s portfolio may be invested in this category.

10. Money Market Funds (“MMF”). Purchases are restricted to Government Money Market Funds. Furthermore, these Money Market Funds must have met either of the following criteria: (A) Attained the

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highest ranking or the highest letter and numerical rating provided by not less than two NRSROs, or (B) Retained an investment advisor with not less than five years’ experience and registered or exempt from registration with the SEC, with assets under management in excess of five hundred million dollars ($500,000,000). A maximum of 20% of the City’s portfolio may be invested in this category.

11. Supranational Obligations. United States dollar denominated senior unsecured unsubordinated obligations issued or unconditionally guaranteed by the International Bank for Reconstruction and Development, International Finance Corporation, or Inter-American Development Bank, with a maximum remaining maturity of five years or less, and eligible for purchase and sale within the United States.

Investments under this subdivision shall be rated in a rating category of “AA” or its equivalent or better by a Nationally Recognized Statistical Rating Organization (“NRSRO”). A maximum of 30% the City’s portfolio may be invested in this category.

12. Asset-Backed Securities. A mortgage passthrough security, collateralized mortgage obligation, mortgage-backed or other pay-through bond, equipment lease-backed certificate, consumer receivable passthrough certificate, or consumer receivable-backed bond. For securities eligible for investment under this subdivision not issued or guaranteed by an agency or issuer identified in subdivisions (1) or (5) above, the following limitations apply:
(1) The security shall have of a maximum of five years’ maturity and .

Securities eligible for investment under this subdivision shall be rated in a rating category of “AA” or its equivalent or better by an NRSRO. (2) A maximum of 20% the City’s portfolio may be invested in this category.
(G) Performance Standards
The investment portfolio shall be managed with the objective of obtaining a rate of return throughout budgetary and economic cycles, commensurate with the investment risk constraints and the cash flow needs. The City will employ an active management approach that allows for the sale of securities prior to their scheduled maturity dates for purposes of improving the portfolio’s credit quality, liquidity, or return in response to changing market conditions or City circumstances. This Policy recognizes that in a diversified portfolio occasional measured losses are inevitable and must be considered within the context of the overall portfolio's structure and expected investment return, with the proviso that adequate diversification and credit analysis have been implemented.

An appropriate performance benchmark shall be established against which portfolio performance shall be compared on a regular basis. The selected

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performance benchmark shall be representative of the City’s overall investment objectives and liquidity requirements.
(H) Investment Reporting and Portfolio Review
A monthly Treasurer’s Report shall be prepared and submitted to the City Council, which shall include a complete description of the portfolio, type of investments, issuers, and other relevant information.

The City Treasurer shall review the portfolio at least on a quarterly basis to verify that the securities in the portfolio are in compliance with this Policy and shall report any issues of material non-compliance in the next monthly Treasurer’s Report. Percentage holding limits and diversification requirements listed in this Policy apply at the time a security is purchased. If a percentage holding limit or diversification requirement is exceeded due to a subsequent change in the portfolio, it is not a compliance violation, but no additional securities may be purchased in that category or for that issuer until the holdings are back under the Policy limits. Credit ratings, where shown, specify the minimum credit rating category required at purchase. In the event a security held by the City is subject to a credit rating change that brings it below the minimum credit ratings specified in this Policy, the City Treasurer should notify the City Council of the change in the next monthly Treasurer’s Report. The course of action to be followed will then be decided on a case-by-case basis, considering such factors as the reason for the change, prognosis for recovery or further rating downgrades, and the market price of the security. If a security is determined to be out of compliance with this Policy due to a subsequent change in this Policy or the Government Code, it may be held to maturity unless there is a requirement that the security be sold. (I) Debt Proceeds
Debt proceeds and bond reserve funds are to be invested in accordance with their respective bond indenture. If the indenture is silent as to the permitted investments, the bond proceeds will be invested in the securities permitted by this Policy. Notwithstanding the other provisions of this Policy, the percentage limitations listed elsewhere in this Policy do not apply to bond proceeds and bond proceeds may be invested beyond five years if the maturities of such investments do not exceed the expected use of the funds, the investments are deemed prudent in the opinion of the City Treasurer, and the investments are not prohibited by the applicable bond documents. Tax and Revenue Anticipation Notes or other temporary financing proceeds shall not be invested for a term that exceeds the term of the debt.

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Number: F-10 Issue Number: 19
Page: 10 Date Adopted: June 20, 2023
Replaces: June 210, 20223
(J) Safekeeping
To protect against potential losses by collapse of individual securities dealers, all deliverable securities owned by the City, including collateral on repurchase agreements, shall be held in safekeeping by a third party bank trust department acting as agent for the City under the terms of a custody agreement executed by the bank and by the City. All deliverable securities will be received and delivered using standard delivery-versus-payment procedures.
(K) Qualified Financial Institutions and Broker/Dealers Investments not purchased directly from the issuer, shall be purchased either from an institution licensed by the state as a broker-dealer or from a member of a federally regulated securities exchange, from a national or state-chartered bank, from a savings association or federal association, or from a brokerage firm designated as a primary government dealer by the Federal Reserve Bank. If the City is utilizing a financial dealer or institution to execute transactions, the City Treasurer shall maintain a list of the firms that have been approved for investment purposes. A copy of this Policy shall be sent annually to all firms with which the City executes investments.

If the City has contracted with an Investment Advisor to provide investment services, the Investment Advisor may use their own list of approved issuers, brokers/dealers, and financial institutions with which to conduct transactions on the City’s behalf.

V. DEFINITIONS
AGENCIES: Securities issued by federal agency securities and/or Governmentsponsored enterprises (e.g. FNMA, FHLMC, FHLB).

AMORTIZED COST (or Book Value): For investments purchased at a discount, amortized cost constitutes cost plus interest earned to date.

ASKED: The price at which securities are offered for sale; also known as offering price.

ASSET-BACKED SECURITIES (ABS): Securities whose income payments and hence value is derived from and collateralized (or "backed") by a specified pool of underlying assets which are receivables. Pooling the assets into financial instruments allows them to be sold to general investors, a process called securitization, and allows the risk of investing in the underlying assets to be diversified because each security will represent a

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fraction of the total value of the diverse pool of underlying assets. The pools of underlying assets can comprise common payments credit cards, auto loans, mortgage loans, and other types of assets. Interest and principal is paid to investors from borrowers who are paying down their debt.

BASIS POINT: One hundredth of one percent (i.e. 0.01 percent).

BENCHMARK: A comparative base for measuring the performance or risk tolerance of the investment portfolio. A benchmark should represent a close correlation to the level of risk and the average duration of the portfolio’s investments.

BID: The price offered by a buyer of securities. (When you are selling securities, you ask for a bid.) See Offer.

BROKER: A broker brings buyers and sellers together for a commission.

CALLABLE BOND: A bond issue in which all or part of its outstanding principal amount may be redeemed before maturity by the issuer under specified conditions.

CERTIFICATE OF DEPOSIT (CD): A time deposit with a specific maturity evidenced by a Certificate. Large denomination CD’s are typically negotiable.

COMMERCIAL PAPER: An unsecured promissory note with a fixed maturity no longer than 270 days.

COLLATERAL: Securities, evidence of deposit or other property, which secures repayment of an investment. Also refers to securities pledged by a bank to secure deposits of public monies.

ANNUAL COMPREHENSIVE FINANCIAL REPORT (ACFR): The official annual report of the City. It includes financial statements in conformity with GAAP. It also includes supporting schedules necessary to demonstrate compliance with finance-related legal and contractual provisions, extensive introductory material, and a detailed Statistical Section.

COUPON: (a) The annual rate of interest that a bond’s issuer promises to pay the bondholder on the bond’s face value.
(b) A certificate attached to a bond evidencing interest due on a payment date.

CREDIT RISK: The risk to an investor that an issuer will default in the payment of interest and/or principal on a security and a loss will result.

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CUSTODIAN: A bank or other financial institution that keeps custody of stock certificates and other assets.

DEALER: A dealer, as opposed to a broker, acts as a principal in all transactions, buying and selling for his own account.

DEBENTURE: A bond secured only by the general credit of the issuer.

DELIVERY VERSUS PAYMENT: There are two methods of delivery of securities:
delivery versus payment and delivery versus receipt. Delivery versus payment is delivery of securities with an exchange of money for the securities. Delivery versus receipt is delivery of securities with an exchange of a signed receipt for the securities.

DERIVATIVES: (1) Financial instruments whose return profile is linked to, or derived from, the movement of one or more underlying index or security, and may include a leveraging factor, or (2) financial contracts based upon notional amounts whose value is derived from an underlying index or security (interest rates, foreign exchange rates, equities or commodities).

DISCOUNT: The difference between the cost price of a security and its maturity when quoted at lower than face value. A security selling below original offering price shortly after sale also is considered to be at a discount.

DISCOUNT SECURITIES: Non-interest bearing money market instruments that are issued a discount and redeemed at maturity for full face value (e.g., U.S. Treasury Bills, commercial paper.)
DIVERSIFICATION: Dividing investment funds among a variety of securities offering independent returns.

DURATION: A measure of the sensitivity of the price (the value of principal) of a fixedincome investment to a change in interest rates. This calculation is based on three variables: term to maturity, coupon rate, and yield to maturity. Duration is expressed as a number of years. The duration of a security is a useful indicator of its price volatility for given changes in interest rates. Rising interest rates mean falling bond prices, while declining interest rates mean rising bond prices.

FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC): A federal agency that insures bank deposits.

FEDERAL FARM CREDIT BANK (FFCB): Government-sponsored institution that consolidates the financing activities of the Federal Land Banks, the Federal Intermediate

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Credit Banks and the Banks for Cooperatives. Its securities do not carry direct U.S.

Government guarantees.

FEDERAL FUNDS RATE: The rate of interest at which Fed funds are traded. This rate is currently pegged by the Federal Reserve through open-market operations.

FEDERAL HOME LOAN BANKS (FHLB): Government sponsored wholesale banks (currently 12 regional banks), which lend funds and provide correspondent banking services to member commercial banks, thrift institutions, credit unions and insurance companies. The mission of the FHLBs is to liquefy the housing related assets of its members who must purchase stock in their district Bank.

FEDERAL HOME LOAN MORTGAGE CORPORATION (FHLMC or Freddie Mac):

Established in 1970 to help maintain the availability of mortgage credit for residential housing. FHLMC finances these operations by marketing guaranteed mortgage certificates and mortgage participation certificates. FHLMC’s securities are highly liquid and are widely accepted. FHLMC is currently operated under conservatorship of the U.S. Government.

FEDERAL NATIONAL MORTGAGE ASSOCIATION (FNMA or Fannie Mae):

FNMA was chartered under the Federal National Mortgage Association Act in 1938.

FNMA is a Federal corporation working under the auspices of the Department of Housing and Urban Development (HUD). It is the largest single provider of residential mortgage funds in the United States. The corporation’s purchases include a variety of adjustable mortgages and second loans, in addition to fixed-rate mortgages. FNMA’s securities are also highly liquid and are widely accepted. FNMA is currently operated under conservatorship of the U.S. Government.

FEDERAL OPEN MARKET COMMITTEE (FOMC): Consists of seven members of the Federal Reserve Board and five of the twelve Federal Reserve Bank Presidents. The President of the New York Federal Reserve Bank is a permanent member, while the other Presidents serve on a rotating basis. The Committee periodically meets to set Federal Reserve guidelines regarding purchases and sales of Government Securities in the open market as a means of influencing the volume of bank credit and money.

FEDERAL RESERVE SYSTEM: The central bank of the U.S. which consists of seven member Board of Governors, 12 regional banks, and about 5,700 commercial banks that are members.

FINANCIAL INDUSTRY REGULATORY AUTHORITY (FINRA): The Financial Industry Regulatory Authority (FINRA) is the largest independent regulator for all securities firms doing business in the United States. All told, FINRA oversees nearly 4,750 brokerage

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firms, about 167,000 branch offices and approximately 634,000 registered securities representatives.

INTEREST RATE RISK: The risk of gain or loss in market values of securities due to changes in interest-rate levels. For example, rising interest rates will cause the market value of portfolio securities to decline.

INVESTMENT POLICY: A clear and concise statement of the objectives and parameters formulated by an investor or investment manager for a portfolio of investment securities.

LIQUIDITY: A liquid asset is one that can be converted easily and rapidly into cash without a substantial loss of value. In the money market, a security is said to be liquid if the spread between bid and asked prices is narrow and reasonable size can be done at those quotes.

LOCAL AGENCY INVESTMENT FUND (LAIF): The aggregate of all funds from political subdivisions that are placed in the custody of the State Treasurer for investment purposes.

LOCAL GOVERNMENT INVESTMENT POOL (LGIP): A type of pooled investment program in which funds from local agency investors/participants are aggregated together for investment purposes.

MARKET VALUE: The price at which a security is trading and could presumably be purchased or sold.

MATURITY: The date upon which the principal or stated value of an investment becomes due and payable.

MEDIUM-TERM NOTES (MTNs): Unsecured corporate obligations. For purposes of the California Government Code, they have a maximum remaining maturity of five years or less.

MONEY MARKET: The market in which short-term debt instruments (bills, commercial paper, bankers’ acceptances, etc.) are issued and traded.

MONEY MARKET FUND. A type of mutual fund that invests exclusively in short-term investments.

MORTGAGE-BACKED SECURITIES (MBS): These securities represent an ownership interest in mortgage loans made by financial institutions (savings and loans, commercial banks, or mortgage companies) to finance the borrower’s purchase of a home or other

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real estate. MBS are created when these loans are packaged, or “pooled,” by issuers or servicers for sale to investors. As the underlying mortgage loans are paid off by the homeowners, the investors receive payments of interest and principal.

MUTUAL FUND: A fund operated by an investment company that raises money from shareholders and invests it on their behalf. Profits are distributed to shareholders after the investment company deducts its management fee. Mutual funds are regulated by the SEC.

NATIONALLY RECOGNIZED STATISTICAL RATING ORGANIZATION (NRSRO): A credit rating agency that issue credit ratings that the U.S. Securities and Exchange Commission (SEC) permits other financial firms to use for certain regulatory purposes.

The largest three NRSROs are Standard & Poor’s, Moody’s Investors Service and Fitch Ratings.

NEGOTIABLE: Something that can be sold or transferred to another party.

NEGOTIABLE CERTIFICATES OF DEPOSIT: Large denomination certificates of deposit with a fixed maturity date, which can be sold in the money market. They are not collateralized.

OFFER: The price asked by a seller of securities. (When you are buying securities, you ask for an offer.) See Asked and Bid.

OPEN MARKET OPERATIONS: Purchases and sales of government and certain other securities in the open market by the New York Federal Reserve Bank as directed by the FOMC in order to influence the volume of money and credit in the economy. Purchases inject reserves into the bank system and stimulate growth of money and credit; sales have the opposite effect. Open market operations are the Federal Reserve’s most important and most flexible monetary policy tool.

PAR VALUE: The amount of principal that must be paid at maturity. Also referred to as the face amount of a bond, normally quoted in increments of $1,000 per bond.

PORTFOLIO: Collection of securities held by an investor.

PRIMARY DEALER: A group of government securities dealers who submit daily reports of market activity and positions and monthly financial statements to the Federal Reserve Bank of New York and are subject to its informal oversight. Primary dealers include Securities and Exchange Commission (SEC)-registered securities broker-dealers, banks, and a few unregulated firms.

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PREMIUM: The amount by which a security sells above its par value.

PRINCIPAL: The face or par value of a debt instrument or the amount of capital invested in a given security.

PRUDENT INVESTORS RULE: An investment standard. In California, persons authorized to make investment decisions on behalf of a local agency are considered trustees and therefore fiduciaries subject to the Prudent Investor Rule. A trustee may invest in a security if it is one which would be bought by a prudent person of discretion and intelligence who is seeking a reasonable income and preservation of capital.

QUALIFIED PUBLIC DEPOSITORIES: A financial institution which does not claim exemption from the payment of any sales or compensating use or ad valorem taxes under the laws of this state, which has segregated for the benefit of the commission eligible collateral having a value of not less than its maximum liability and which has been approved by the Public Deposit Protection Commission to hold public deposits.

RATE OF RETURN: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond the current income return.

SAFEKEEPING: A service banks offer to clients for a fee, where physical securities are held in the bank’s vault for protection and book-entry securities are on record with the Federal Reserve Bank or Depository Trust Company in the bank’s name for the benefit of the client. As agent for the client, the safekeeping bank settles securities transactions, collects coupon payments, and redeems securities at maturity or, if called, on the call date.

SECONDARY MARKET: A market made for the purchase and sale of outstanding issues following the initial distribution.

SECURITIES: Investment instruments such as notes, bonds, stocks, money market instruments and other instruments of indebtedness of equity.

SECURITIES & EXCHANGE COMMISSION (sec): Agency created by Congress to protect investors in securities transactions by administering securities legislation.

SPREAD: The difference between two figures or percentages. It may be the difference between the bid (price at which a prospective buyer offers to pay) and asked (price at which an owner offers to sell) prices of a quote, or between the amount paid when bought and the amount received when sold.

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SUPRANATIONAL: Supranational entities are formed by two or more central governments with the purpose of promoting economic development for the member countries. Supranational institutions finance their activities by issuing debt, such as supranational bonds. Examples of supranational institutions include the European Investment Bank and the World Bank. Similarly to the government bonds, the bonds issued by these institutions are considered direct obligations of the issuing nations and have a high credit rating.

TREASURY SECURITIES. Obligations issued by the federal government, which are backed by the U.S. Government’s full faith & credit. Generally considered to have the lowest credit risk of any security. They are issued in a range of maturities:
• TREASURY BILLS. Are short-term, non-interest bearing discount security having initial maturities of one-year or less.
• TREASURY NOTES. Are Intermediate-term coupon-bearing securities having initial maturities from two to ten years.
• TREASURY BONDS. Are long-term coupon-bearing securities having initial maturities of more than ten years.

UNIFORM NET CAPITAL RULE: Securities and Exchange Commission requirement that member firms as well as nonmember broker-dealers in securities maintain a maximum ratio of indebtedness to liquid capital of 15 to 1; also called net capital rule and net capital ratio. Indebtedness covers all money owed to a firm, including margin loans and commitments to purchase securities, one reason new public issues are spread among members of underwriting syndicates. Liquid capital includes cash and assets easily converted into cash.

WEIGHTED AVERAGE MATURITY (OR DURATION): The sum of the amount of each investment multiplied by the number of days to maturity (or duration), divided by the total amount of investments.

YIELD: The annual rate of return on an investment expressed as a percentage of the investment. Income yield is obtained by dividing the current dollar income by the current market price for the security.

YIELD CURVE: Yield calculations of various maturities of instruments of the same quality at a given time to show yield relationships.

PUBLIC WORKS DEPARTMENT
DATE: AUGUST 6, 2024
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: JAMIE LAI, P.E., DIRECTOR OF PUBLIC WORKS/CITY ENGINEER PREPARED BY: AUSTIN POSTOVOIT, SENIOR MANAGEMENT ANALYST SUBJECT: APPROVAL OF GRANT AGREEMENT TERMS AND CONDITIONS FOR

THE ENERGY EFFICIENCY AND CONSERVATION BLOCK GRANT AND
APPROVE GRANT FUNDING APPROPRIATION FOR PROJECT FC241010

RECOMMENDATION
It is recommended that City Council:

1. Approve the Special Terms and Conditions (Attachment 1) for the Energy Efficiency and Conservation Block Grant (EECBG) for the Electric Vehicle Charger Installation Project FC241010; and

2. Authorize acceptance of reimbursable grant funding via a supplemental budget appropriation in an amount of $124,310.00 from the Miscellaneous Grant Fund (207) with a corresponding budget increase to Project No. FC241010 (Account Number 4010050-461610) for a revised project budget of $299,310.00; and

3. Authorize the City Manager on behalf of Council to sign and execute the Special Terms and Conditions (Grant Agreement) and any associated grant agreement documents including future grant amendments pertinent to the EECBG Project.

BACKGROUND
The Public Works department regularly monitors grant opportunities to identify potential funding opportunities to offset the project costs. City staff was made aware of a U.S.

Department of Energy (DOE) grant funding opportunity made available through the State & Community Energy Programs EECBG equipment rebate focused program. The EECBG program allows for a variety of project types that improve energy efficiency and incorporate renewable energy, for transportation, and related areas and is funded by the Infrastructure Investment and Jobs Act (IIJA).

Upon reviewing the grant program's specifications, it was clear that the City’s Electric Vehicle Charger Installation Citywide project (FC241010) could be eligible for funding.

Originally allocated $25,000 for preliminary design costs, this project had progressed

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enough to form a solid basis for a grant application. City staff, working with consultant Forefront Power, had developed a site plan and cost estimate for installing electric vehicle chargers at the City's maintenance yard. Given the options for grant applications, competitive or formula-based, the latter was preferred due to its higher chance of success, less demanding requirements, and reduced need for extensive staff effort and preemptive costs. The formula-based grant for the City of Yorba Linda could provide up to $124,310.

City staff had previously engaged the City’s consultant Forefront Power to begin developing a site plan and project cost estimate for the installation of City fleet electric vehicle chargers at the City’s maintenance and operations Yard on Eureka Avenue, which was ultimately used in the grant application.

DISCUSSION
The City was notified by the DOE on July 2, 2024, that the voucher application for EECBG funding for the Electric Vehicle Charger Installation Citywide (FC241010) was approved and that the full formula amount of $124,310.00 was to be awarded. The award was approved for the aforementioned project primarily under the allowable category of “equipment rebates” which allows for retrofit technologies, renewable energy technologies, micromobility equipment, alternative fuel vehicles, and electric vehicle charging stations. Although the City’s awarded project as titled in the Capital Improvement Project (CIP) budget refers solely to design, the entire project included in the grant application implements design, equipment purchase, system upgrades and installation. Since the grant application was being pursued in tandem with the City’s adoption of the two-year CIP budget, staff proactively appropriated additional funding for the project to accommodate the necessary expenditures that would be associated with the entire project once the grant application was successful.

The EECBG grant application required a focused project be submitted, and as such, staff and City consultants narrowed the project scope to include the installation of two, two-port, electric vehicle charging stations at the City’s maintenance and operations yard on Eureka Avenue. The grant portion of the project will primarily entail the purchase of charging stations and their installation. The proposed design configuration will allow for four passenger fleet vehicles to be charged at one time, and depending upon cost estimates may allow for running of conduit for a future additional charging station. It should be noted that the City’s award limited these charging stations to utilization for City fleet charging and not public use.

The charging stations provided for in the project are intended to be similar to the charging stations previously installed at City Hall and the Yorba Linda Public Library.

In order to accept the grant funds awarded to the City, the associated Special Terms and Conditions in Attachment 1 must be approved and signed before returning to the EECBG grant team. The terms and conditions, which have been reviewed and approved by the City Attorney, incorporate various associated regulation documents and guidelines that must be abided by during the project. Approval and execution of the Terms and Conditions will function as a grant agreement that allows the City to be reimbursed up to the full grant voucher amount. Therefore, staff recommends that City Council approve the special terms and conditions and authorize the City Manager to sign and execute the necessary grant

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agreement documents required to accept funding. It should be noted that a two-year grant period began on July 2, 2024, the date of approval, for which all funds must be expended.

Timely approval and acceptance is critical towards allowing sufficient lead time to complete the project before the grant deadline.

FISCAL IMPACT
The current project budget for project FC241010, as approved in the FY2024/2025 Capital Improvement Budget is $175,000.00, comprised in amounts of $125,000.00 from the Air Quality Maintenance District Fund (209) and $25,000.00 from the Special Reserve Fund (102). These existing funds cumulatively represent the City’s leveraged funds, which function similarly to cost share or matching funds, but do not obligate the City to a specific percentage of funding if the project does not require additional expenditure. The leveraged funds, the total of which was included in the City’s updated Grant Funding Application, will supplement the proposed EECBG grant funding for project costs. Upon appropriation of the grant funds the total Project FC241010 budget will be $299,310.00. It should be noted that the EECBG is a reimbursable grant which requires the City to appropriate the full grant funding amount in advance and allows the City to be reimbursed for allowable expensed grant funds upon submission of approved requests for reimbursement.

ALTERNATIVES
The City Council may choose to not approve the terms and conditions; however, this is not recommended as it would result in the forfeit of the grant funding award.

ATTACHMENTS
Attachment 1 – EECBG Agreement Special Terms and Conditions

Template Version 12/19/2023
EECBG Program
Special Terms and Conditions
Special Terms and Conditions
Entity Name:___________________________________ (“Recipient”), which is identified in the Assistance Agreement, and the Office of State and Community Energy Programs (“SCEP”), and Energy Efficiency and Conservation Block Grant Program (“EECBG”), an office within the United States Department of Energy (“DOE”), enters into this Award, to achieve the project objectives and the technical milestones and deliverables stated in Attachment 1 to this Award.

This Award consists of the following documents, including all terms and conditions therein:

Special Terms and Conditions
Attachment 1 Federal Assistance Reporting Checklist (FARC)1 Attachment 2 NEPA Determination2
The following are incorporated into this Award by reference:
• DOE Assistance Regulations, 2 CFR part 200 as amended by 2 CFR part 910 at http://www.eCFR.gov.
• National Policy Requirements (November 12, 2020) at
http://www.nsf.gov/awards/managing/rtc.jsp.
• The Recipient’s application/proposal as approved by SCEP. • Public Law 117-58, also known as the Bipartisan Infrastructure Law (BIL). 1 The FARC will be provided at a later date.
2 The NEPA Determination is attached to your application in the EECBG Program Voucher Application Portal

CITY OF YORBA LINDA

Special Terms and Conditions
2 Table of Contents
Subpart A. General Provisions......................................................................................................................... 4 Term 1. Legal Authority and Effect.......................................................................................................................4 Term 2. Flow Down Requirement ........................................................................................................................4 Term 3. Compliance with Federal, State, and Municipal Law .............................................................................4 Term 4. Inconsistency with Federal Law ..............................................................................................................4 Term 5. Federal Stewardship................................................................................................................................4 Term 6. NEPA Requirements ................................................................................................................................4 Term 7. Notice Regarding the Purchase of American-Made Equipment and Products – Sense of Congress ....5 Term 8. Reporting Requirements.........................................................................................................................5 Term 9. Lobbying...................................................................................................................................................5 Term 10. Publications .............................................................................................................................................5 Term 11. No-Cost Extension ...................................................................................................................................6 Term 12. Property Standards..................................................................................................................................6 Term 13. Insurance Coverage .................................................................................................................................6 Term 14. Real Property ...........................................................................................................................................7 Term 15. Equipment ...............................................................................................................................................7 Term 16. Supplies....................................................................................................................................................8 Term 17. Property Trust Relationship ....................................................................................................................8 Term 18. Record Retention.....................................................................................................................................8 Term 19. Audits.......................................................................................................................................................8 Term 20. Indemnity.................................................................................................................................................9 Term 21. Foreign National Participation ................................................................................................................9 Term 22. Post-Award Due Diligence Reviews........................................................................................................9 Subpart B. Financial Provisions .......................................................................................................................10 Term 23. Maximum Obligation.............................................................................................................................10 Term 24. Refund Obligation..................................................................................................................................10 Term 25. Allowable Costs .....................................................................................................................................10 Term 26. Decontamination and/or Decommissioning (D&D) Costs....................................................................10 Term 27. Use of Program Income.........................................................................................................................10 Term 28. Payment Procedures .............................................................................................................................11 Term 29. Budget Changes.....................................................................................................................................11 Subpart C. Miscellaneous Provisions..............................................................................................................12 Term 30. Environmental, Safety and Health Performance of Work at DOE Facilities........................................12 Term 31. System for Award Management and Universal Identifier Requirements...........................................12 Term 32. Nondisclosure and Confidentiality Agreements Assurances ...............................................................14 Term 33. Contractor Change Notification ............................................................................................................15 Term 34. Recipient Integrity and Performance Matters......................................................................................16 Term 35. Export Control........................................................................................................................................18 Term 36. Interim Conflict of Interest Policy for Financial Assistance..................................................................18 Term 37. Organizational Conflict of Interest........................................................................................................18 Term 38. Prohibition on Certain Telecommunications and Video Surveillance Services or Equipment............19 Term 39. Human Subjects Research.....................................................................................................................20 Term 40. Fraud, Waste and Abuse .......................................................................................................................21 Subpart D. Bipartisan Infrastructure Law (BIL)-specific requirements................................................................21 Term 41. Reporting, Tracking and Segregation of Incurred Costs.......................................................................21

Special Terms and Conditions
3 Term 42. Davis-Bacon Requirements...................................................................................................................22 Term 43. Buy American Requirement for Infrastructure Projects ......................................................................23 Term 44. Affirmative Action and Pay Transparency Requirements....................................................................29 Term 45. Potentially Duplicative Funding Notice ................................................................................................29 Term 46. Transparency of Foreign Connections...................................................................................................29 Term 47. Foreign Collaboration Considerations ..................................................................................................30

Special Terms and Conditions
4 Subpart A. General Provisions
Term 1. Legal Authority and Effect
A DOE financial assistance award is valid only if it is in writing and is signed, either in writing or electronically, by a DOE Contracting Officer.

The Recipient may accept or reject the Award. Acknowledgement of award documents by the Recipient’s authorized representative through electronic systems used by DOE, specifically The EECBG Program Voucher Portal (https://doerebates.my.site.com/eecbgvouchers/s/), constitutes the Recipient's acceptance of the terms and conditions of this Award.

Acknowledgement via the EECBG Program Voucher Portal by the Recipient’s authorized representative constitutes the Recipient's electronic signature.

Term 2. Flow Down Requirement
The Recipient agrees to apply the terms and conditions of this Award, as applicable to all subcontractors as required by 2 CFR 200.101, and to require their strict compliance therewith.

Further, the Recipient must apply the Award terms as required by 2 CFR 200.327 to all sub contractors and to require their strict compliance therewith.

Term 3. Compliance with Federal, State, and Municipal Law The Recipient is required to comply with applicable Federal, state, and local laws and regulations for all work performed under this Award. The Recipient is required to obtain all necessary Federal, state, and local permits, authorizations, and approvals for all work performed under this Award.

Term 4. Inconsistency with Federal Law
Any apparent inconsistency between Federal statutes and regulations and the terms and conditions contained in this Award must be referred to the DOE Award Administrator for guidance.

Term 5. Federal Stewardship
SCEP will exercise normal Federal stewardship in overseeing the project activities performed under this Award. Stewardship activities include, but are not limited to, conducting site visits; reviewing performance and financial reports; providing technical assistance and/or temporary intervention in unusual circumstances to address deficiencies that develop during the project; assuring compliance with terms and conditions; and reviewing technical performance after project completion to ensure that the project objectives have been accomplished.

Term 6. NEPA Requirements
DOE must comply with the National Environmental Policy Act (NEPA) prior to authorizing the use of Federal funds. Based on all information provided by the Recipient, SCEP has made a

Special Terms and Conditions
5 NEPA determination by issuing a categorical exclusion (CX) for all activities listed in the Application approved by the Contracting Officer and the DOE NEPA Determination. The Recipient is thereby authorized to use Federal funds for the defined project activities, except where such activity is subject to a restriction set forth elsewhere in this Award.

This authorization is specific to the project activities and locations as described in the Application approved by the Contracting Officer and the DOE NEPA Determination.

If the Recipient later intends to add to or modify the activities or locations as described in the approved Application and the DOE NEPA Determination, those new activities/locations or modified activities/locations are subject to additional NEPA review and are not authorized for Federal funding until the Contracting Officer provides written authorization on those additions or modifications. Should the Recipient elect to undertake activities or change locations prior to written authorization from the Contracting Officer, the Recipient does so at risk of not receiving Federal funding for those activities, and such costs may not be recognized as allowable cost share.

Condition(s):

NEPA Logs if conducting potentially ground disturbing activities.

Term 7. Notice Regarding the Purchase of American-Made Equipment and Products – Sense of Congress
It is the sense of the Congress that, to the greatest extent practicable, all equipment and products purchased with funds made available under this Award should be American-made.

Term 8. Reporting Requirements
The reporting requirements for this Award are identified on the Federal Assistance Reporting Checklist, attached to this Award. Failure to comply with these reporting requirements is considered a material noncompliance with the terms of the Award. Noncompliance may result in withholding of future payments, suspension, or termination of the current award, and withholding of future awards. A willful failure to perform, a history of failure to perform, or unsatisfactory performance of this and/or other financial assistance awards, may also result in a debarment action to preclude future awards by Federal agencies.

Term 9. Lobbying
By accepting funds under this Award, the Recipient agrees that none of the funds obligated on the Award shall be expended, directly or indirectly, to influence congressional action on any legislation or appropriation matters pending before Congress, other than to communicate to Members of Congress as described in 18 U.S.C. § 1913. This restriction is in addition to those prescribed elsewhere in statute and regulation.

Term 10. Publications

Special Terms and Conditions
6 The Recipient is required to include the following acknowledgement in publications arising out of, or relating to, work performed under this Award, whether copyrighted or not:
• Acknowledgment: “This material is based upon work supported by the U.S. Department of Energy’s Office of State and Community Energy Programs (SCEP) under the Energy Efficiency and Conservation Block Grant (EECBG) Program Application # XXXXXXXXX” • Full Legal Disclaimer: “This report was prepared as an account of work sponsored by an agency of the United States Government. Neither the United States Government nor any agency thereof, nor any of their employees, makes any warranty, express or implied, or assumes any legal liability or responsibility for the accuracy, completeness, or usefulness of any information, apparatus, product, or process disclosed, or represents that its use would not infringe privately owned rights. Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily constitute or imply its endorsement, recommendation, or favoring by the United States Government or any agency thereof.

The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States Government or any agency thereof.” Abridged Legal Disclaimer: “The views expressed herein do not necessarily represent the views of the U.S. Department of Energy or the United States Government.” Recipients should make every effort to include the full Legal Disclaimer. However, in the event that recipients are constrained by formatting and/or page limitations set by the publisher, the abridged Legal Disclaimer is an acceptable alternative.

Term 11. No-Cost Extension
As provided in 2 CFR 200.308, the Recipient must provide the Contracting Officer with notice in advance if it intends to utilize a one-time, no-cost extension of this Award. The notification must include the supporting reasons and the revised period of performance. The Recipient must submit this notification in writing to the Contracting Officer and DOE Technology Manager/ Project Officer at least 30 days before the end of the current budget period.

Any no-cost extension will not alter the project scope, milestones, deliverables, or budget of this Award.

Term 12. Property Standards
The complete text of the Property Standards can be found at 2 CFR 200.310 through 200.316.

Also see 2 CFR 910.360 for additional requirements for real property and equipment for ForProfit recipients.

Term 13. Insurance Coverage

Special Terms and Conditions
7 See 2 CFR 200.310 for insurance requirements for real property and equipment acquired or improved with Federal funds. Also see 2 CFR 910.360(d) for additional requirements for real property and equipment for For-Profit recipients.

Term 14. Real Property
Subject to the conditions set forth in 2 CFR 200.311, title to real property acquired or improved under a Federal award will conditionally vest upon acquisition in the non-Federal entity. The non-Federal entity cannot encumber this property and must follow the requirements of 2 CFR 200.311 before disposing of the property.

Except as otherwise provided by Federal statutes or by the Federal awarding agency, real property will be used for the originally authorized purpose as long as needed for that purpose.

When real property is no longer needed for the originally authorized purpose, the non-Federal entity must obtain disposition instructions from DOE or pass-through entity. The instructions must provide for one of the following alternatives: (1) retain title after compensating DOE as described in 2 CFR 200.311(c)(1); (2) Sell the property and compensate DOE as specified in 2 CFR 200.311(c)(2); or (3) transfer title to DOE or to a third party designated/approved by DOE as specified in 2 CFR 200.311(c)(3).

See 2 CFR 200.311 for additional requirements pertaining to real property acquired or improved under a Federal award.

Term 15. Equipment
Subject to the conditions provided in 2 CFR 200.313, title to equipment (property) acquired under a Federal award will conditionally vest upon acquisition with the non-Federal entity. The non-Federal entity cannot encumber this property and must follow the requirements of 2 CFR 200.313 before disposing of the property.

Equipment must be used by the non-Federal entity in the program or project for which it was acquired as long as it is needed, whether or not the project or program continues to be supported by the Federal award. When no longer needed for the originally authorized purpose, the equipment may be used by programs supported by DOE in the priority order specified in 2 CFR 200.313(c)(1)(i) and (ii).

Management requirements, including inventory and control systems, for equipment are provided in 2 CFR 200.313(d).

When equipment acquired under a Federal award is no longer needed, the non-Federal entity must obtain disposition instructions from DOE or pass-through entity.

Disposition will be made as follows: (1) items of equipment with a current fair market value of $5,000 or less may be retained, sold, or otherwise disposed of with no further obligation to DOE; (2) Non-Federal entity may retain title or sell the equipment after compensating DOE as

Special Terms and Conditions
8 described in 2 CFR 200.313(e)(2); or (3) transfer title to DOE or to an eligible third party as specified in 2 CFR 200.313(e)(3).

See 2 CFR 200.313 for additional requirements pertaining to equipment acquired under a Federal award. See also 2 CFR 200.439 Equipment and other capital expenditures.

Term 16. Supplies
See 2 CFR 200.314 for requirements pertaining to supplies acquired under a Federal award. See also 2 CFR 200.453 Materials and supplies costs, including costs of computing devices.

Term 17. Property Trust Relationship
Real property, equipment, and intangible property, that are acquired or improved with a Federal award must be held in trust by the non-Federal entity as trustee for the beneficiaries of the project or program under which the property was acquired or improved. See 2 CFR 200.316 for additional requirements pertaining to real property, equipment, and intangible property acquired or improved under a Federal award.

Term 18. Record Retention
Consistent with 2 CFR 200.334 through 200.338, the Recipient is required to retain records relating to this Award.

Term 19. Audits
A. Government-Initiated Audits
The Recipient must provide any information, documents, site access, or other assistance requested by SCEP, DOE or Federal auditing agencies (e.g., DOE Inspector General, Government Accountability Office) for the purpose of audits and investigations. Such assistance may include, but is not limited to, reasonable access to the Recipient’s records relating to this Award.

Consistent with 2 CFR part 200 as amended by 2 CFR part 910, DOE may audit the Recipient’s financial records or administrative records relating to this Award at any time. Government-initiated audits are generally paid for by DOE.

DOE may conduct a final audit at the end of the project period (or the termination of the Award, if applicable). Upon completion of the audit, the Recipient is required to refund to DOE any payments for costs that were determined to be unallowable. If the audit has not been performed or completed prior to the closeout of the award, DOE retains the right to recover an appropriate amount after fully considering the recommendations on disallowed costs resulting from the final audit.

DOE will provide reasonable advance notice of audits and will minimize interference

Special Terms and Conditions
9 with ongoing work, to the maximum extent practicable.

B. Annual Independent Audits (Single Audit or Compliance Audit) The Recipient must comply with the annual independent audit requirements in 2 CFR 200.500 through .521 for institutions of higher education, nonprofit organizations, and state and local governments (Single audit), and 2 CFR 910.500 through .521 for for-profit entities (Compliance audit).

The annual independent audits are separate from Government-initiated audits discussed in part A. of this Term and must be paid for by the Recipient. To minimize expense, the Recipient may have a Compliance audit in conjunction with its annual audit of financial statements. The financial statement audit is not a substitute for the Compliance audit. If the audit (Single audit or Compliance audit, depending on Recipient entity type) has not been performed or completed prior to the closeout of the award, DOE may impose one or more of the actions outlined in 2 CFR 200.339, Remedies for Noncompliance.

Term 20. Indemnity
The Recipient shall indemnify DOE and its officers, agents, or employees for any and all liability, including litigation expenses and attorneys' fees, arising from suits, actions, or claims of any character for death, bodily injury, or loss of or damage to property or to the environment, resulting from the project, except to the extent that such liability results from the direct fault or negligence of DOE officers, agents or employees, or to the extent such liability may be covered by applicable allowable costs provisions.

Term 21. Foreign National Participation
If the Recipient (including any of its contractors) anticipates involving foreign nationals in the performance of the Award, the Recipient must, upon DOE’s request, provide DOE with specific information about each foreign national to ensure compliance with the requirements for participation and access approval. The volume and type of information required may depend on various factors associated with the Award. The DOE Contracting Officer will notify the Recipient if this information is required.

DOE may elect to deny a foreign national’s participation in the Award. Likewise, DOE may elect to deny a foreign national’s access to a DOE sites, information, technologies, equipment, programs or personnel.

Term 22. Post-Award Due Diligence Reviews
During the life of the Award, DOE may conduct ongoing due diligence reviews, through Government resources, to identify potential risks of undue foreign influence. In the event, a risk is identified, DOE may require risk mitigation measures, including but not limited to, requiring an individual or entity not participate in the Award.

Special Terms and Conditions
10 Subpart B. Financial Provisions
Term 23. Maximum Obligation
The maximum obligation of DOE for this Award is the total “Funds Obligated” stated in Block 13 of the Assistance Agreement to this Award.

Term 24. Refund Obligation
The Recipient must refund any excess payments received from SCEP, including any costs determined unallowable by the Contracting Officer. Upon the end of the project period (or the termination of the Award, if applicable), the Recipient must refund to SCEP the difference between (1) the total payments received from SCEP, and (2) the Federal share of the costs incurred. Refund obligations under this Term do not supersede the annual reconciliation or true up process if specified under the Indirect Cost Term.

Term 25. Allowable Costs
SCEP determines the allowability of costs through reference to 2 CFR part 200 as amended by 2 CFR part 910. All project costs must be allowable, allocable, and reasonable. The Recipient must document and maintain records of all project costs, including, but not limited to, the costs paid by Federal funds, costs claimed by its subcontractors, and project costs that the Recipient claims as cost sharing, including in-kind contributions. The Recipient is responsible for maintaining records adequate to demonstrate that costs claimed have been incurred, are reasonable, allowable and allocable, and comply with the cost principles. Upon request, the Recipient is required to provide such records to SCEP. Such records are subject to audit.

Failure to provide SCEP adequate supporting documentation may result in a determination by the Contracting Officer that those costs are unallowable.

The Recipient is required to obtain the prior written approval of the Contracting Officer for any foreign travel costs.

Term 26. Decontamination and/or Decommissioning (D&D) Costs Notwithstanding any other provisions of this Award, the Government shall not be responsible for or have any obligation to the Recipient for (1) Decontamination and/or Decommissioning (D&D) of any of the Recipient’s facilities, or (2) any costs which may be incurred by the Recipient in connection with the D&D of any of its facilities due to the performance of the work under this Award, whether said work was performed prior to or subsequent to the effective date of the Award.

Term 27. Use of Program Income
If the Recipient earns program income during the project period as a result of this Award, the

Special Terms and Conditions
11 Recipient must add the program income to the funds committed to the Award and used to further eligible project objectives.

Term 28. Payment Procedures
A. Method of Payment
Payment will be made by reimbursement by CFO through ACH. Equipment rebate voucher applications will be approved for payment by DOE once the equipment has been installed and all required documentation has been provided.

B. Payments
All payments are made by electronic funds transfer to the bank account identified attached to the Recipient’s UEI and identified in the Recipient’s SAM.gov account.

C. Unauthorized Drawdown of Federal Funds
For each budget period, the Recipient may not spend more than the Federal share authorized to that award, without specific written approval from the Contracting Officer. The Recipient must immediately refund SCEP any amounts spent in excess of the authorized amount.

A. Supporting Documents for Agency Approval of Payments DOE may request additional information from the Recipient to support the payment requests prior to release of funds, as deemed necessary. The Recipient is required to comply with these requests. Supporting documents include invoices, copies of contracts, vendor quotes, proof of installation and other expenditure explanations that justify the payment requests.

Term 29. Budget Changes
A. Budget Changes Generally
The Contracting Officer has reviewed and approved the budget in Attachment 1 to this Award.

Any increase in the total project cost, whether DOE share or Cost Share, which is stated as “Total” in Block 12 to the Assistance Agreement of this Award, must be approved in advance and in writing by the Contracting Officer.

Any change that alters the project scope, milestones or deliverables requires prior written approval of the Contracting Officer. SCEP may deny reimbursement for any failure to comply with the requirements in this term.

Special Terms and Conditions
12 B. Transfers of Funds Among Direct Cost Categories
The Recipient is required to obtain the prior written approval of the Contracting Officer for any transfer of funds among direct cost categories where the cumulative amount of such transfers exceeds or is expected to exceed 10 percent of the total project cost stated in the budget on the recipient’s application.

The Recipient is required to notify the DOE Technology Manager/Project Officer of any transfer of funds among direct cost categories where the cumulative amount of such transfers is equal to or below 10 percent of the total project cost, stated in the budget on the recipient’s application.

Subpart C. Miscellaneous Provisions
Term 30. Environmental, Safety and Health Performance of Work at DOE Facilities
With respect to the performance of any portion of the work under this Award which is performed at a DOE -owned or controlled site, the Recipient agrees to comply with all State and Federal Environmental, Safety and Health (ES&H) regulations and with all other ES&H requirements of the operator of such site.

Prior to the performance on any work at a DOE-owned or controlled site, the Recipient shall contact the site facility manager for information on DOE and site-specific ES&H requirements.

The Recipient is required apply this provision to its contractors.

Term 31. System for Award Management and Universal Identifier Requirements
A. Requirement for Registration in the System for Award Management (SAM) Unless the Recipient is exempted from this requirement under 2 CFR 25.110, tThe Recipient must maintain the currency of its information in SAM until the Recipient submits the final financial report required under this Award or receive the final payment, whichever is later. This requires that the Recipient reviews and updates the information at least annually after the initial registration, and more frequently if required by changes in its information or another award term.

B. Unique Entity Identifier (UEI)
SAM automatically assigns a UEI to all active SAM.gov registered entities. Entities no longer have to go to a third-party website to obtain their identifier. This information

Special Terms and Conditions
13 is displayed on SAM.gov.

If the Recipient is authorized to make subawards under this Award, the Recipient:
i. Must notify potential subrecipients that no entity (see definition in paragraph C of this award term) may receive a subaward from the Recipient unless the entity has provided its UEI number to the Recipient.
ii. May not make a subaward to an entity unless the entity has provided its UEI number to the Recipient.

C. Definitions
For purposes of this award term:
i. System for Award Management (SAM) means the Federal repository into which an entity must provide information required for the conduct of business as a recipient. Additional information about registration procedures may be found at the SAM Internet site (currently at ).
ii. Unique Entity Identifier (UEI) is the 12-character, alpha-numeric identifier that will be assigned by SAM.gov upon registration.
iii. Entity, as it is used in this award term, means all of the following, as defined at 2 CFR Part 25, subpart C:

1. A Governmental organization, which is a State, local government, or Indian Tribe.

2. A foreign public entity.

3. A domestic or foreign nonprofit organization.

4. A domestic or foreign for-profit organization.

5. A Federal agency, but only as a subrecipient under an award or subaward to a non-Federal entity.
iv. Subaward:

1. This term means a legal instrument to provide support for the performance of any portion of the substantive project or program for which the Recipient received this Award and that the Recipient awards to an eligible subrecipient.

2. The term does not include the Recipient’s procurement of property and services needed to carry out the project or program (for further explanation, see 2 CFR 200.501 Audit requirements, (f) Subrecipients

Special Terms and Conditions
14 and Contractors and/or 2 CFR 910.501 Audit requirements, (f) Subrecipients and Contractors).

3. A subaward may be provided through any legal agreement, including an agreement that the Recipient considers a contract.
v. Subrecipient means an entity that:

1. Receives a subaward from the Recipient under this Award; and

2. Is accountable to the Recipient for the use of the Federal funds provided by the subaward.

Term 32. Nondisclosure and Confidentiality Agreements Assurances A. By entering into this agreement, the Recipient attests that it does not and will not require its employees or contractors to sign internal nondisclosure or confidentiality agreements or statements prohibiting or otherwise restricting its employees or contactors from lawfully reporting waste, fraud, or abuse to a designated investigative or law enforcement representative of a Federal department or agency authorized to receive such information.

B. The Recipient further attests that it does not and will not use any Federal funds to implement or enforce any nondisclosure and/or confidentiality policy, form, or agreement it uses unless it contains the following provisions:
i. ‘‘These provisions are consistent with and do not supersede, conflict with, or otherwise alter the employee obligations, rights, or liabilities created by existing statute or Executive order relating to (1) classified information, (2) communications to Congress, (3) the reporting to an Inspector General of a violation of any law, rule, or regulation, or mismanagement, a gross waste of funds, an abuse of authority, or a substantial and specific danger to public health or safety, or (4) any other whistleblower protection. The definitions, requirements, obligations, rights, sanctions, and liabilities created by controlling Executive orders and statutory provisions are incorporated into this agreement and are controlling.’’
ii. The limitation above shall not contravene requirements applicable to Standard Form 312, Form 4414, or any other form issued by a Federal department or agency governing the nondisclosure of classified information. iii. Notwithstanding provision listed in paragraph (a), a nondisclosure or confidentiality policy form or agreement that is to be executed by a person connected with the conduct of an intelligence or intelligence-related activity,

Special Terms and Conditions
15 other than an employee or officer of the United States Government, may contain provisions appropriate to the particular activity for which such document is to be used. Such form or agreement shall, at a minimum, require that the person will not disclose any classified information received in the course of such activity unless specifically authorized to do so by the United States Government. Such nondisclosure or confidentiality forms shall also make it clear that they do not bar disclosures to Congress, or to an authorized official of an executive agency or the Department of Justice, that are essential to reporting a substantial violation of law.

Term 33. Contractor Change Notification
Except for contractors specifically proposed as part of the Recipient’s Application for award, the Recipient must notify the Contracting Officer and Project Manager in writing 30 days prior to the execution of new or modified contract agreements, including naming any To Be Determined contractors. This notification does not constitute a waiver of the prior approval requirements outlined in 2 CFR part 200 as amended by 2 CFR part 910, nor does it relieve the Recipient from its obligation to comply with applicable Federal statutes, regulations, and executive orders.

In order to satisfy this notification requirement, the Recipient documentation must, as a minimum, include the following:
• A description of the service to be provided or the equipment to be purchased. • An assurance that the process undertaken by the Recipient to solicit the contractor complies with their written procurement procedures as outlined in 2 CFR 200.317 through 200.327.
• An assurance that no planned, actual or apparent conflict of interest exists between the Recipient and the selected contractor and that the Recipient’s written standards of conduct were followed.
3 • A completed Environmental Questionnaire, if applicable. • An assurance that the contractor is not a debarred or suspended entity. • An assurance that all required award provisions will be flowed down in the resulting contract agreement.
3 It is DOE’s position that the existence of a “covered relationship” as defined in 5 CFR 2635.502(a)&(b) between a member of the Recipient’s owners or senior management and a member of a subrecipient’s owners or senior management creates at a minimum an apparent conflict of interest that would require the Recipient to notify the Contracting Officer and provide detailed information and justification (including, for example, mitigation measures) as to why the subrecipient agreement does not create an actual conflict of interest. The Recipient must also notify the Contracting Officer of any new subrecipient agreement with: (1) an entity that is owned or otherwise controlled by the Recipient; or (2) an entity that is owned or otherwise controlled by another entity that also owns or otherwise controls the Recipient, as it is DOE’s position that these situations also create at a minimum an apparent conflict of interest.

Special Terms and Conditions
16 The Recipient is responsible for making a final determination to award or modify contractor agreements under this agreement, but the Recipient may not proceed with the contractor agreement until the Contracting Officer determines, and provides the Recipient written notification, that the information provided is adequate.

Should the Recipient not receive a written notification of adequacy from the Contracting Officer within 30 days of the submission of the contractor documentation stipulated above, the Recipient may proceed to award or modify the proposed contractor agreement.

Term 34. Recipient Integrity and Performance Matters
A. General Reporting Requirement
If the total value of your currently active Financial Assistance awards, grants, and procurement contracts from all Federal awarding agencies exceeds $10,000,000 for any period of time during the period of performance of this Federal award, then you as the recipient during that period of time must maintain the currency of information reported to the System for Award Management (SAM) that is made available in the designated integrity and performance system (currently the Federal Awardee Performance and Integrity Information System (FAPIIS)) about civil, criminal, or administrative proceedings described in paragraph 2 of this term. This is a statutory requirement under section 872 of Public Law 110-417, as amended (41 U.S.C. 2313). As required by section 3010 of Public Law 111-212, all information posted in the designated integrity and performance system on or after April 15, 2011, except past performance reviews required for Federal procurement contracts, will be publicly available.

B. Proceedings About Which You Must Report
Submit the information required about each proceeding that:
i. Is in connection with the award or performance of a Financial Assistance, cooperative agreement, or procurement contract from the Federal Government;
ii. Reached its final disposition during the most recent five-year period; and iii. Is one of the following:

1. A criminal proceeding that resulted in a conviction, as defined in paragraph E of this award term and condition;

2. A civil proceeding that resulted in a finding of fault and liability and payment of a monetary fine, penalty, reimbursement, restitution, or damages of $5,000 or more;

3. An administrative proceeding, as defined in paragraph E of this term, that resulted in a finding of fault and liability and your payment of either a monetary fine or penalty of $5,000 or more or
reimbursement, restitution, or damages in excess of $100,000; or

Special Terms and Conditions
17 4. Any other criminal, civil, or administrative proceeding if:
a. It could have led to an outcome described in paragraph B.iii.1, 2, or 3 of this term;
b. It had a different disposition arrived at by consent or compromise with an acknowledgment of fault on your part; and
c. The requirement in this term to disclose information about the proceeding does not conflict with applicable laws and regulations.

C. Reporting Procedures
Enter in the SAM Entity Management area the information that SAM requires about each proceeding described in paragraph B of this term. You do not need to submit the information a second time under assistance awards that you received if you already provided the information through SAM because you were required to do so under Federal procurement contracts that you were awarded.

D. Reporting Frequency
During any period of time when you are subject to the requirement in paragraph A of this term, you must report proceedings information through SAM for the most recent five-year period, either to report new information about any proceeding(s) that you have not reported previously or affirm that there is no new information to report. Recipients that have Federal contract, Financial Assistance awards, (including cooperative agreement awards) with a cumulative total value greater than $10,000,000, must disclose semiannually any information about the criminal, civil, and administrative proceedings.

E. Definitions
For purposes of this term:
i. Administrative proceeding means a non-judicial process that is adjudicatory in nature in order to make a determination of fault or liability (e.g., Securities and Exchange Commission Administrative proceedings, Civilian Board of Contract Appeals proceedings, and Armed Services Board of Contract Appeals proceedings). This includes proceedings at the Federal and State level but only in connection with performance of a Federal contract or Financial Assistance awards. It does not include audits, site visits, corrective plans, or inspection of deliverables.
ii. Conviction means a judgment or conviction of a criminal offense by any court of competent jurisdiction, whether entered upon a verdict or a plea, and includes a conviction entered upon a plea of nolo contendere. iii. Total value of currently active Financial Assistance awards, cooperative agreements and procurement contracts includes—

Special Terms and Conditions
18 1. Only the Federal share of the funding under any Federal award with a recipient cost share or match; and

2. The value of all expected funding increments under a Federal award and options, even if not yet exercised.

Term 35. Export Control
The United States government regulates the transfer of information, commodities, technology, and software considered to be strategically important to the U.S. to protect national security, foreign policy, and economic interests without imposing undue regulatory burdens on legitimate international trade. There is a network of Federal agencies and regulations that govern exports that are collectively referred to as “Export Controls.” The Recipient is responsible for ensuring compliance with all applicable United States Export Control laws and regulations relating to any work performed under a resulting award.

The Recipient must immediately report to DOE any export control violations related to the project funded under this award, at the recipient or subrecipient level, and provide the corrective action(s) to prevent future violations.

Term 36. Interim Conflict of Interest Policy for Financial Assistance The DOE interim Conflict of Interest Policy for Financial Assistance (COI Policy) can be found at https://www.energy.gov/management/department-energy-interim-conflict-interest-policyrequirements-financial-assistance. This policy is applicable to all non-Federal entities applying for, or that receive, DOE funding by means of a financial assistance award (e.g., a grant, cooperative agreement, or technology investment agreement) and, through the implementation of this policy by the entity, to each Investigator who is planning to participate in, or is participating in, the project funded wholly or in part under this Award. The term “Investigator” means the PI and any other person, regardless of title or position, who is responsible for the purpose, design, conduct, or reporting of a project funded by DOE or proposed for funding by DOE. The Recipient must flow down the requirements of the interim COI Policy to any contracting non-Federal entities, with the exception of DOE National Laboratories. Further, the Recipient must identify all financial conflicts of interests (FCOI), i.e., managed and unmanaged/ unmanageable, in its initial and ongoing FCOI reports.

Prior to award, the Recipient was required to: 1) ensure all Investigators on this Award completed their significant financial disclosures; 2) review the disclosures; 3) determine whether a FCOI exists; 4) develop and implement a management plan for FCOIs; and 5) provide DOE with an initial FCOI report that includes all FCOIs (i.e., managed and unmanaged/unmanageable). Within 180 days of the date of the Award, the Recipient must be in full compliance with the other requirements set forth in DOE’s interim COI Policy.

Term 37. Organizational Conflict of Interest
Organizational conflicts of interest are those where, because of relationships with a parent company, affiliate, or subsidiary organization, the Recipient is unable or appears to be unable to

Special Terms and Conditions
19 be impartial in conducting procurement action involving a related organization (2 CFR 200.318(c)(2)).

The Recipient must disclose in writing any potential or actual organizational conflict of interest to the DOE Contracting Officer. The Recipient must provide the disclosure prior to engaging in a procurement or transaction using project funds with a parent, affiliate, or subsidiary organization that is not a state, local government, or Indian tribe. For a list of the information that must be included the disclosure, see Section VI. of the DOE interim Conflict of Interest Policy for Financial Assistance at https://www.energy.gov/management/department-energyinterim-conflict-interest-policy-requirements-financial-assistance.

If the effects of the potential or actual organizational conflict of interest cannot be avoided, neutralized, or mitigated, the Recipient must procure goods and services from other sources when using project funds. Otherwise, DOE may terminate the Award in accordance with 2 CFR 200.340 unless continued performance is determined to be in the best interest of the Federal government.

The Recipient must flow down the requirements of the interim COI Policy to any contracting non-Federal entities, with the exception of DOE National Laboratories. The Recipient is responsible for ensuring contractor compliance with this term.

If the Recipient has a parent, affiliate, or subsidiary organization that is not a state, local government, or Indian tribe, the Recipient must maintain written standards of conduct covering organizational conflicts of interest.

Term 38. Prohibition on Certain Telecommunications and Video Surveillance Services or Equipment
As set forth in 2 CFR 200.216, recipients and subrecipients are prohibited from obligating or expending project funds (Federal and non-Federal funds) to:
(1) Procure or obtain;
(2) Extend or renew a contract to procure or obtain; or (3) Enter into a contract (or extend or renew a contract) to procure or obtain equipment, services, or systems that uses covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system. As described in Public Law 115-232, section 889, covered telecommunications equipment is telecommunications equipment produced by Huawei Technologies Company or ZTE Corporation (or any subsidiary or affiliate of such entities). (i) For the purpose of public safety, security of government facilities, physical security surveillance of critical infrastructure, and other national security purposes, video

Special Terms and Conditions
20 surveillance and telecommunications equipment produced by Hytera Communications Corporation, Hangzhou Hikvision Digital Technology Company, or Dahua Technology Company (or any subsidiary or affiliate of such entities). (ii) Telecommunications or video surveillance services provided by such entities or using such equipment.
(iii) Telecommunications or video surveillance equipment or services produced or provided by an entity that the Secretary of Defense, in consultation with the Director of the National Intelligence or the Director of the Federal Bureau of Investigation, reasonably believes to be an entity owned or controlled by, or otherwise connected to, the government of a covered foreign country.

See Public Law 115-232, section 889 for additional information.

Term 39. Human Subjects Research
Research involving human subjects, biospecimens, or identifiable private information conducted with Department of Energy (DOE) funding is subject to the requirements of DOE Order 443.1C, Protection of Human Research Subjects, 45 CFR Part 46, Protection of Human Subjects (subpart A which is referred to as the “Common Rule”), and 10 CFR Part 745, Protection of Human Subjects.

Federal regulation and the DOE Order require review by an Institutional Review Board (IRB) of all proposed human subjects research projects. The IRB is an interdisciplinary ethics board responsible for ensuring that the proposed research is sound and justifies the use of human subjects or their data; the potential risks to human subjects have been minimized; participation is voluntary; and clear and accurate information about the study, the benefits and risks of participating, and how individuals’ data/specimens will be protected/used, is provided to potential participants for their use in determining whether or not to participate.

The Recipient shall provide the Federal Wide Assurance number identified in item 1 below and the certification identified in item 2 below to DOE prior to initiation of any project that will involve interactions with humans in some way (e.g., through surveys); analysis of their identifiable data (e.g., demographic data and energy use over time); asking individuals to test devices, products, or materials developed through research; and/or testing of commercially available devices in buildings/homes in which humans will be present. Note: This list of examples is illustrative and not all inclusive.

No DOE funded research activity involving human subjects, biospecimens, or identifiable private information shall be conducted without:

Special Terms and Conditions
21 1) A registration and a Federal Wide Assurance of compliance accepted by the Office of Human Research Protection (OHRP) in the Department of Health and Human Services; and
2) Certification that the research has been reviewed and approved by an Institutional Review Board (IRB) provided for in the assurance. IRB review may be accomplished by the awardee’s institutional IRB; by the Central DOE IRB; or if collaborating with one of the DOE national laboratories, by the DOE national laboratory IRB.

The Recipient is responsible for ensuring all subrecipients comply and for reporting information on the project annually to the DOE Human Subjects Research Database (HSRD) at https://science.osti.gov/HumanSubjects/Human-Subjects-Database/home. Note: If a DOE IRB is used, no end of year reporting will be needed.

Additional information on the DOE Human Subjects Research Program can be found at:
https://science.osti.gov/ber/human-subjects
Term 40. Fraud, Waste and Abuse
The mission of the DOE Office of Inspector General (OIG) is to strengthen the integrity, economy and efficiency of DOE’s programs and operations including deterring and detecting fraud, waste, abuse and mismanagement. The OIG accomplishes this mission primarily through investigations, audits, and inspections of Department of Energy activities to include grants, cooperative agreements, loans, and contracts. The OIG maintains a Hotline for reporting allegations of fraud, waste, abuse, or mismanagement. To report such allegations, please visit https://www.energy.gov/ig/ig‐hotline.

Additionally, the Recipient must be cognizant of the requirements of 2 CFR § 200.113 Mandatory disclosures, which states:

The non‐Federal entity or applicant for a Federal award must disclose, in a timely manner, in writing to the Federal awarding agency or pass‐through entity all violations of Federal criminal law involving fraud, bribery, or gratuity violations potentially affecting the Federal award. Non‐Federal entities that have received a Federal award including the term and condition outlined in appendix XII of 2 CFR Part 200 are required to report certain civil, criminal, or administrative proceedings to SAM (currently FAPIIS). Failure to make required disclosures can result in any of the remedies described in § 200.339. (See also 2 CFR part 180, 31 U.S.C. 3321, and 41 U.S.C. 2313.) Subpart D. Bipartisan Infrastructure Law (BIL)-specific requirements

Term 41. Reporting, Tracking and Segregation of Incurred Costs

Special Terms and Conditions
22 BIL funds can be used in conjunction with other funding, as necessary to complete projects, but tracking and reporting must be separate to meet the reporting requirements of the BIL and related Office of Management and Budget (OMB) Guidance. The Recipient must keep separate records for BIL funds and must ensure those records comply with the requirements of the BIL.

Funding provided through the BIL that is supplemental to an existing grant or cooperative agreement is one-time funding.

Term 42. Davis-Bacon Requirements
This award is funded under Division D of the Bipartisan Infrastructure Law (BIL). All laborers and mechanics employed by the recipient, subrecipients, contractors or subcontractors in the performance of construction, alteration, or repair work in excess of $2,000 on an award funded directly by or assisted in whole or in part by funds made available under this award shall be paid wages at rates not less than those prevailing on similar projects in the locality, as determined by the Secretary of Labor in accordance with subchapter IV of chapter 31 of title 40, United States Code commonly referred to as the “Davis-Bacon Act” (DBA).

Recipients shall provide written assurance acknowledging the DBA requirements for the award or project and confirming that all of the laborers and mechanics performing construction, alteration, or repair, through funding under the award are paid or will be paid wages at rates not less than those prevailing on projects of a character similar in the locality as determined by Subchapter IV of Chapter 31 of Title 40, United States Code (Davis-Bacon Act).

The Recipient must comply with all of the Davis-Bacon Act requirements, including but not limited to:
(1) ensuring that the wage determination(s) and appropriate Davis-Bacon clauses and requirements are flowed down to and incorporated into any applicable subcontracts.
(2) being responsible for compliance by any subcontractor with the Davis-Bacon labor standards.
(3) receiving and reviewing certified weekly payrolls submitted by all subcontractors and subrecipients for accuracy and to identify potential compliance issues.
(4) maintaining original certified weekly payrolls for 3 years after the completion of the project and must make those payrolls available to the DOE or the Department of Labor upon request, as required by 29 CFR 5.6(a)(2). (5) conducting payroll and job-site reviews for construction work, including interviews with employees, with such frequency as may be necessary to assure compliance by its subcontractors and as requested or directed by the DOE. (6) cooperating with any authorized representative of the Department of Labor in their inspection of records, interviews with employees, and other actions undertaken as part of a Department of Labor investigation.

Special Terms and Conditions
23 (7) posting in a prominent and accessible place the wage determination(s) and Department of Labor Publication: WH-1321, Notice to Employees Working on Federal or Federally Assisted Construction Projects.
(8) notifying the Contracting Officer of all labor standards issues, including all complaints regarding incorrect payment of prevailing wages and/or fringe benefits, received from the recipient, , contractor, or subcontractor employees; significant labor standards violations, as defined in 29 CFR 5.7; disputes concerning labor standards pursuant to 29 CFR parts 4, 6, and 8 and as defined in FAR 52.222-14; disputed labor standards determinations; Department of Labor investigations; or legal or judicial proceedings related to the labor standards under this Contract, a subcontract, or subrecipient award. (9) preparing and submitting to the Contracting Officer, the Office of Management and Budget Control Number 1910-5165, Davis Bacon Semi-Annual Labor Compliance Report, by April 21 and October 21 of each year. Form submittal will be administered through the iBenefits system (https://doeibenefits2.energy.gov) or its successor system.

The Recipient must undergo Davis-Bacon Act compliance training and must maintain competency in Davis-Bacon Act compliance. The Contracting Officer will notify the Recipient of any DOE sponsored Davis-Bacon Act compliance trainings. The Department of Labor offers free Prevailing Wage Seminars several times a year that meet this requirement, at https://www.dol.gov/agencies/whd/government-contracts/construction/seminars/events.

The Department of Energy has contracted with, a third-party DBA electronic payroll compliance software application. The Recipient must ensure the timely electronic submission of weekly certified payrolls as part of its compliance with the Davis-Bacon Act unless a waiver is granted to a particular contractor or subcontractor because they are unable or limited in their ability to use or access the software.

Davis Bacon Act Electronic Certified Payroll Submission Waiver A waiver must be granted before the award starts. The applicant does not have the right to appeal SCEP’s decision concerning a waiver request.

For additional guidance on how to comply with the Davis-Bacon provisions and clauses, see https://www.dol.gov/agencies/whd/government-contracts/construction and https://www.dol.gov/agencies/whd/government-contracts/protections-for-workers-inconstruction.

Term 43. Buy American Requirement for Infrastructure Projects *NOTE: Buy American Requirements only apply to awards over $250,000. Please disregard this section if your total EECBG Program award is less than $250,000.

Special Terms and Conditions
24 A. Definitions
Components are defined as the articles, materials, or supplies incorporated directly into the end manufactured product(s).

Construction Materials are an article, material, or supply—other than an item primarily of iron or steel; a manufactured product; cement and cementitious materials; aggregates such as stone, sand, or gravel; or aggregate binding agents or additives—that is used in an infrastructure project and is or consists primarily of non-ferrous metals, plastic and polymer-based products (including
polyvinylchloride, composite building materials, and polymers used in fiber optic cables), glass (including optic glass), lumber, drywall, coatings (paints and stains), optical fiber, clay brick; composite building materials; or enginSCEPd wood products.

Domestic Content Procurement Preference Requirement- means a requirement that no amounts made available through a program for federal financial assistance may be obligated for an infrastructure project unless—
(A) all iron and steel used in the project are produced in the United States;
(B) the manufactured products used in the project are produced in the United States; or
(C) the construction materials used in the project are produced in the United States.

Also referred to as the Buy America Requirement.

Infrastructure includes, at a minimum, the structures, facilities, and equipment located in the United States, for: roads, highways, and bridges; public transportation; dams, ports, harbors, and other maritime facilities; intercity passenger and freight railroads; freight and intermodal facilities; airports; water systems, including drinking water and wastewater systems; electrical transmission facilities and systems; utilities; broadband infrastructure; and buildings and real property; and generation, transportation, and distribution of energy - including electric vehicle (EV) charging.

The term “infrastructure” should be interpreted broadly, and the definition provided above should be considered as illustrative and not exhaustive.

Special Terms and Conditions
25 Manufactured Products are items used for an infrastructure project made up of components that are not primarily of iron or steel; construction materials; cement and cementitious materials’ aggregates such as stone, sand, or gravel; or aggregate binding agents or additives.

Primarily of iron or steel means greater than 50% iron or steel, measured by cost.

Project- means the construction, alteration, maintenance, or repair of infrastructure in the United States.

Public- The Buy America Requirement does not apply to non-public infrastructure. For purposes of this guidance, infrastructure should be considered “public” if it is: (1) publicly owned or (2) privately owned but utilized primarily for a public purpose. Infrastructure should be considered to be “utilized primarily for a public purpose” if it is privately operated on behalf of the public or is a place of public accommodation.

B. Buy America Requirement
None of the funds provided under this award (federal share or recipient cost-share) may be used for a project for infrastructure unless:

1. All iron and steel used in the project is produced in the United States—this means all manufacturing processes,
from the initial melting stage through the application of coatings, occurred in the United States;

2. All manufactured products used in the project are
produced in the United States—this means the
manufactured product was manufactured in the United
States; and the cost of the components of the
manufactured product that are mined, produced, or
manufactured in the United States is greater than 55
percent of the total cost of all components of the
manufactured product, unless another standard for
determining the minimum amount of domestic content of
the manufactured product has been established under
applicable law or regulation; and

Special Terms and Conditions
26 3. All construction materials are manufactured in the United States—this means that all manufacturing processes for the construction material occurred in the United States.

The Buy America Requirement only applies to articles, materials, and supplies that are consumed in, incorporated into, or permanently affixed to an infrastructure project. As such, it does not apply to tools, equipment, and supplies, such as temporary scaffolding, brought into the construction site and removed at or before the completion of the infrastructure project. Nor does a Buy America Requirement apply to equipment and furnishings, such as movable chairs, desks, and portable computer equipment, that are used at or within the finished infrastructure project but are not an integral part of the structure or permanently affixed to the infrastructure project.

Recipients are responsible for administering their award in accordance with the terms and conditions, including the Buy America Requirement. The recipient must ensure that the Buy America Requirement flows down to all subawards and that the subawardees and subrecipients comply with the Buy America Requirement. The Buy America Requirement term and condition must be included all sub-awards, contracts, subcontracts, and purchase orders for work performed under the infrastructure project.

C. Certification of Compliance
The Recipient must certify or provide equivalent documentation for proof of compliance that a good faith effort was made to solicit bids for domestic products used in the infrastructure project under this Award.

The Recipient must also maintain certifications or equivalent documentation for proof of compliance that those articles, materials, and supplies that are consumed in, incorporated into, affixed to, or otherwise used in the infrastructure project, not covered by a waiver or exemption, are produced in the United States. The certification or proof of compliance must be provided by the suppliers or manufacturers of the iron, steel, manufactured products and construction materials and flow up from all subawardees, contractors and vendors to the Recipient. The Recipient must keep these certifications with the award/project files and be able to produce them upon request from DOE, auditors or Office of Inspector General.

Special Terms and Conditions
27 D. Waivers
When necessary, the Recipient may apply for, and DOE may grant, a waiver from the Buy America Requirement. Requests to waive the application of the Buy America Requirement must be in writing to the Contracting Officer. Waiver requests are subject to review by DOE and the Office of Management and Budget, as well as a public comment period of no less than 15 calendar days.

Waivers must be based on one of the following justifications:

1. Public Interest- Applying the Buy America Requirement would be inconsistent with the public interest;

2. Non-Availability- The types of iron, steel, manufactured products, or construction materials are not produced in the United States in sufficient and reasonably available quantities or of a satisfactory quality; or

3. Unreasonable Cost- The inclusion of iron, steel, manufactured products, or construction materials produced in the United States will increase the cost of the overall project by more than 25 percent.

Requests to waive the Buy America Requirement must include the following:
• Waiver type (Public Interest, Non-Availability, or Unreasonable Cost);
• Recipient name and Unique Entity Identifier (UEI);
• Award information (Federal Award Identification Number, Assistance Listing number);
• A brief description of the project, its location, and the specific infrastructure involved;
• Total estimated project cost, with estimated federal share and recipient cost share breakdowns;
• Total estimated infrastructure costs, with estimated federal share and recipient cost share breakdowns;
• List and description of iron or steel item(s), manufactured goods, and/or construction material(s) the recipient seeks to waive from the Buy America Preference, including name, cost, quantity(ies), country(ies) of origin, and relevant Product Service Codes (PSC) and North American Industry Classification System (NAICS) codes for each;

Special Terms and Conditions
28 • A detailed justification as to how the non-domestic item(s) is/are essential the project;
• A certification that the recipient made a good faith effort to solicit bids for domestic products supported by terms included in requests for proposals, contracts, and non-proprietary communications with potential suppliers;
• A justification statement—based on one of the applicable justifications outlined above—as to why the listed items cannot be procured domestically, including the due diligence performed (e.g., market research, industry outreach, cost analysis, cost-benefit analysis) by the recipient to attempt to avoid the need for a waiver. This justification may cite, if applicable, the absence of any Buy America-compliant bids received for domestic products in response to a solicitation; and
• Anticipated impact to the project if no waiver is issued.

The Recipient should consider using the following principles as minimum requirements contained in their waiver request:
• Time-limited: Consider a waiver constrained principally by a length of time, rather than by the specific project/award to which it applies. Waivers of this type may be appropriate, for example, when an item that is “non-available” is widely used in the project. When requesting such a waiver, the Recipient should identify a reasonable, definite time frame (e.g., no more than one to two years) designed so that the waiver is reviewed to ensure the condition for the waiver (“non-availability”) has not changed (e.g., domestic supplies have become more
available).
• Targeted: Waiver requests should apply only to the item(s), product(s), or material(s) or category(ies) of item(s), product(s), or material(s) as necessary and justified. Waivers should not be overly broad as this will undermine domestic preference policies.
• Conditional: The Recipient may request a waiver with specific conditions that support the policies of IIJA/BABA and Executive Order 14017.

DOE may request, and the Recipient must provide, additional information for consideration of this wavier. DOE may reject or grant

Special Terms and Conditions
29 waivers in whole or in part depending on its review, analysis, and/or feedback from OMB or the public. DOEs final determination regarding approval or rejection of the waiver request may not be appealed.

Waiver requests may take up to 90 calendar days to process.

Term 44. Affirmative Action and Pay Transparency Requirements All federally assisted construction contracts exceeding $10,000 annually will be subject to the requirements of Executive Order 11246:
(1) Recipients and contractors are prohibited from discriminating in employment decisions on the basis of race, color, religion, sex, sexual orientation, gender identity or national origin.
(2)Recipients and contractors are required to take affirmative action to ensure that equal opportunity is provided in all aspects of their employment. This includes flowing down the appropriate language to all subrecipients, contractors and subcontractors.
(3)Recipients and contractors are prohibited from taking adverse employment actions against applicants and employees for asking about, discussing, or sharing information about their pay or, under certain circumstances, the pay of their co‐workers.

The Department of Labor’s (DOL) Office of Federal Contractor Compliance Programs (OFCCP) uses a neutral process to schedule contractors for compliance evaluations. OFCCP’s Technical Assistance Guide4 should be consulted to gain an understanding of the requirements and possible actions the recipients, subrecipients, contractors and subcontractors must take.

Term 45. Potentially Duplicative Funding Notice
If the Recipient have or receive any other award of federal funds for activities that potentially overlap with the activities funded under this Award, the Recipient must promptly notify DOE in writing of the potential overlap and state whether project funds (i.e., recipient cost share and federal funds) from any of those other federal awards have been, are being, or are to be used (in whole or in part) for one or more of the identical cost items under this Award. If there are identical cost items, the Recipient must promptly notify the DOE Contracting Officer in writing of the potential duplication and eliminate any inappropriate duplication of funding.

Term 46. Transparency of Foreign Connections
4 See OFCCP’s Technical Assistance Guide at:
https://www.dol.gov/sites/dolgov/files/ofccp/Construction/files/ConstructionTAG.pdf?msclkid=9e397d68c4b111ec 9d8e6fecb6c710ec Also see the National Policy Assurances http://www.nsf.gov/awards/managing/rtc.jsp

Special Terms and Conditions
30 During the term of the Award, the Recipient must notify the DOE Contracting Officer within fifteen (15) business days of learning of the following circumstances in relation to the Recipient or contractors:

1. The existence of any joint venture or subsidiary that is based in, funded by, or has a foreign affiliation with any foreign country of risk;

2. Any current or pending contractual or financial obligation or other agreement specific to a business arrangement, or joint venture-like arrangement with an enterprise owned by a country of risk or foreign entity based in a country of risk;

3. Any current or pending change in ownership structure of the Recipient or contractors that increases foreign ownership related to a country of risk;

4. Any current or pending venture capital or institutional investment by an entity that has a general partner or individual holding a leadership role in such entity who has a foreign affiliation with any foreign country of risk;

5. Any current or pending technology licensing or intellectual property sales to a foreign country of risk; and

6. Any current or pending foreign business entity, offshore entity, or entity outside the United States related to the Recipient or subrecipient.

Term 47. Foreign Collaboration Considerations
a. Consideration of new collaborations with foreign organizations and governments.

The Recipient must provide DOE with advanced written notification of any potential collaboration with foreign entities, organizations or governments in connection with its DOE-funded award scope. The Recipient must await further guidance from DOE prior to contacting the proposed foreign entity, organization or government regarding the potential collaboration or negotiating the terms of any potential agreement.
b. Existing collaborations with foreign entities, organizations and governments. The Recipient must provide DOE with a written list of all existing foreign collaborations in which has entered in connection with its DOE-funded award scope. c. Description of collaborations that should be reported: In general, a collaboration will involve some provision of a thing of value to, or from, the Recipient. A thing of value includes but may not be limited to all resources made available to, or from, the recipient in support of and/or related to the Award, regardless of whether or not they have monetary value. Things of value also may include in-kind contributions (such as office/laboratory space, data, equipment, supplies, employees, students).

In-kind contributions not intended for direct use on the Award but resulting in provision of a thing of value from or to the Award must also be reported.

Collaborations do not include routine workshops, conferences, use of the Recipient’s services and facilities by foreign investigators resulting from its standard published

Special Terms and Conditions
31 process for evaluating requests for access, or the routine use of foreign facilities by awardee staff in accordance with the Recipient’s standard policies and procedures. ________________________________________________________________ Authorized Signature Date
Name:

Title:

Entity Name:

MARK A. PULONE CITY MANAGER CITY OF YORBA LINDA

ADMINISTRATION DEPARTMENT
DATE: AUGUST 6, 2024
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: MARK A. PULONE, CITY MANAGER
PREPARED BY: ARLENE QUINTERO, PRINCIPAL RISK AND SAFETY

ANALYST
SUBJECT: DENIAL OF CLAIM FOR DAMAGES-ROCHELL ESTES

RECOMMENDATION
It is recommended that the City Council of the City of Yorba Linda deny the claim for damages filed by Rochell Estes.

BACKGROUND
Claims for damages filed against the City are reviewed and investigated by City staff and a third-party claims administrator with George Hills Company, Inc. George Hills Company specializes in claims management and risk management services. These services are provided through the City’s contract membership in the California Insurance Pool Authority.

City staff make recommendations to the Council for settlement or denial based on the investigatory findings. A claimant’s failure to provide evidence of and/or supporting documents to substantiate the claim for damages will also result in a recommendation for denial of the claim.

DISCUSSION
Rochell Estes
The claimant alleges personal injuries from slipping on wet, uneven ground at Jessamyn West Park. Our records show no prior complaints about water or uneven ground in that area and no additional evidence was provided. The conditions at Jessamyn West Park do not meet the definition of a dangerous condition as defined by California Government Code Section 830(a). The area was well maintained and posed no substantial risk of injury.

Therefore, the third-party claims administrator and City staff recommend denying the claim.

FISCAL IMPACT
None.

DENIAL OF CLAIM FOR DAMAGES-ROCHELL ESTES
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ALTERNATIVES
As an alternative to staff’s recommendations for the claim, the City Council has the following options:

1. Accept liability for the claims and pay the amount specified in the claim forms.

2. Grant settlement authority to a certain amount and direct the claims adjuster to enter settlement negotiations with the claimants.

PLANNING COMMISSION | AGENDA ITEM SUMMARY
MEETING DATE | JULY 24, 2024
Community Development Department
Planning Division
Director
Nate Farnsworth, AICP

4.1 APPROVAL OF JULY 10, 2024 PLANNING COMMISSION MEETING MINUTES A motion by Commissioner Masterson, Second by Commissioner Pease to approve the minutes as mailed. The motion carried (3-0-2-0) with the following roll call vote:

AYES: Masterson, Bernstein, Pease
NOES: None
ABSENT: Behura, Singh
ABSTAIN: None

7.1 CONDITIONAL USE PERMIT 2023-35 WU
A motion by Commissioner Behura, Second by Commissioner Pease to continue Conditional Use Permit 2023-35 Wu to a date certain of August 14, 2024 at 6:30 p.m. The motion carried (3-0-2-0) with the following roll call vote:

AYES: Masterson, Bernstein, Pease
NOES: None
ABSENT: Behura, Singh
ABSTAIN: None

7.2 MODIFICATION TO CONDITIONAL USE PERMIT 2021- 27 - LONE WOLF BREWING

COMPANY
A motion by Commissioner Pease, Second by Commissioner Masterson to adopt Resolution No. 5600 Modification to Conditional Use Permit 2021-27 Lone Wolf Brewing Company with attached conditions of approval. The motion carried (3-0-2-0) with the following roll call vote:

AYES: Masterson, Bernstein, Pease
NOES: None
ABSENT: Behura, Singh
ABSTAIN: None

7.3 CONDITIONAL USE PERMIT 2024-23 SHETH
A motion made by Commissioner Pease, Second by Commissioner Masterson adopt Resolution No. 5601 Conditional Use Permit 2024-23 - Sheth, subject to the attached conditions of approval.

The motion carried (3-0-2-0) with the following roll call vote:

AYES: Masterson, Bernstein, Pease
NOES: None
ABSENT: Behura, Singh
ABSTAIN: None
Adjournment: The meeting adjourned at 7:06 p.m. to the August 14, 2024, Planning Commission meeting at 6:30 p.m.

CITY CLERK'S OFFICE
DATE: AUGUST 6, 2024
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: MARCIA BROWN, CMC
SUBJECT: COUNCIL COMMITTEE AND AGENCY REPORTS

RECOMMENDATION
It is recommended that the City Council receive and file this report.

DISCUSSION
City Council members serve on a number of outside committees and agencies. Attached are updates received recently from these agencies.

ATTACHMENTS

1. Reports from City Council Organizations, Agencies and Committees

QUARTER
REPORT

APRIL-JUNE
2024
Presented to the Bridges at
Kraemer Place Community
Advisory Board

1 Reporting Period
April 1, 2024 – June 30, 2024 (Quarter)
July 1, 2023 – June 30, 2024 (Current Fiscal Year)
July 1, 2022 – June 30, 2023 (Previous Fiscal Year)
Number Served
Quarter Current FY FY 2022-23
Number of Unduplicated Clients 101 598 337
Number of Exits 107 413 224
% of Service Capacity Goal (480 annual) 125% 70%
Coordinated Entry System (CES) Statistics
*CES Chart represents clients active at the end of the reporting period Bed Nights
Current FY
Total number of shelter bed nights 62,252
Number of Active Clients on Community Queue 185
% of Active Clients on Community Queue 99%
Number of Active Clients Matched to a Housing Opportunity 13 % of Active Clients Matched to a Housing Opportunity 7% Total number of unduplicated individuals served current fiscal year who have received Permanent Supportive Housing (PSH) or Housing Choice Voucher (HCV) through the Coordinated Entry System
33 Total number of unduplicated individuals served current fiscal year who have received Rapid Re-Housing (RRH) through the Coordinated Entry System 3

2 Program Exits - Summary
Quarter Current FY FY 2022-23
Positive Exits
Permanent, Temporary, Institutions except Jail/Prison 14 58 56 Negative Exits
Emergency Shelter, Streets, Jail/Prison 59 146 37
Unknown Exits
Unknown, Deceased 34 211 131
Program Exits – Destination Detail
Benchmark: 30% of clients who exit to a known destination will exit to permanent housing.

Progress toward benchmark: 22% of clients who have exited to a known destination have exited to permanent housing.

Exits to Permanent Housing Quarter Current FY FY 2022-23 13 44 45
Rental by client, no ongoing housing subsidy 3 5 3
VASH Housing Subsidy 1 1 0
Rental by client, with other ongoing housing
subsidy 0 1 0
Permanent housing (other than RRH) for formerly
homeless persons 5 6 0
Rental by client, with HCV (tenant or project
based) 3 26 29
Staying or living with family, permanent tenure 1 3 8
Staying or living with friends, permanent tenure 0 0 3
Rental by client, with RRH or equivalent subsidy 0 0 0
Other permanent housing dedicated for formerly
homeless persons 0 2 2

3 Exits to Temporary Housing Quarter Current FY FY 2022-23 0 9 7
Staying or living with family, temporary tenure 0 4 2
Staying or living with friends, temporary tenure 0 2 1
Host Home (non-crisis) 0 0 0
Transitional housing for homeless persons 0 0 3
Hotel or motel paid for without emergency shelter
voucher 0 3 0
Residential project or halfway house with no
homeless criteria 0 0 1
Exits to Institutions Quarter Current FY FY 2022-23
3 10 4
Foster care home or group foster care home 0 0 0
Psychiatric hospital or other psychiatric facility 0 0 0 Substance abuse treatment facility or detox center 1 1 1 Hospital or other residential non-psychiatric
medical facility 0 1 0
Jail, prison, or juvenile detention facility 2 7 0
Long-term care facility or nursing home 0 1 3
Exits to Homelessness Quarter Current FY FY 2022-23
57 139 37
Emergency shelter, including hotel or motel paid
for with emergency shelter voucher 3 8 5
Place not meant for habitation (e.g., a vehicle, an
abandoned building, bus / train / subway station
/ airport or anywhere outside)
54 131 32
Exits to Other Destinations Quarter Current FY FY 2022-23 34 211 131
Deceased 1 3 2
Client Doesn't Know/Client Refused 0 1 6
Data Not Collected (no exit interview completed) 33 207 123 Increased Income
Quarter Current FY FY 2022-23
Participants with Increased Income
(at Annual Assessment and/or Exit) 7 23 24

4 Length of Stay – Current FY
Benchmark: National average for shelter stay is 151 days.

Progress toward benchmark: Shelter average is 161 days for the year.

Benchmark: Between July 2017 to June 2023, the average shelter stay at Bridges for successful housing placement is 248 days.

The average length of stay for a successful housing placement is currently: 387 days** *The chart above may include duplicate client enrollments ** Length of stay for successful housing placement is reported higher than normal due to five outliers that exited between 1,092 to 1,944 days after enrollment. Other permanent housing exits within the report period had an average placement of 258 days after enrollment.

Set Aside Beds
Beds
Available
Quarter
Average
Utilization
MHSA Beds 10 80%
Law Enforcement Beds 20 55%
1 77
149
182
100
73 81
< 24 hours 1-7 days 8-30 days 31-90 days 91-180 days 180-365 days > 365 days Number of Clients
Length of Stay

5 Client Demographics - YTD
Age
Race and Ethnicity
Note: The 2024 HMIS Data Standards, effective October 1, 2023, contribute to reporting race and ethnicity in a manner distinct from previous presentations 16 116
134
154
142
36 0
20 40
60 80
100
120
140
160
180
18-24 25-34 35-44 45-54 55-64 65+
Number of Clients
Age Range
233
76 23
3 9
1 33
1 18
6 1
1 5
2 173
1 0 50 100 150 200 250
White
Black or African American
Asian or Asian American
American Indian, Alaska Native, or Indigenous
Native Hawaiian or Pacific Islander
Middle Eastern or North African
Hispanic/Latina/e/o
Black, African American, or African & American Indian,… Hispanic/Latina/e/o & American Indian, Alaska Native, or… Hispanic/Latina/e/o & Black, African American, or African Native Hawaiian or Pacific Islander & Asian or Asian American Native Hawaiian or Pacific Islander & Black, African…
Native Hawaiian or Pacific Islander & Hispanic/Latina/e/o White & Black, African American, or African
White & Hispanic/Latina/e/o
White & Middle Eastern or North African
Number of Clients
Race

6 Gender
Veteran Status
393
202
1 2
Man Woman Non-Binary Transgender
18 580
Veteran Non-Veteran

7 Chronically Homeless
City Prior to Entry
324
274
Chronically Homeless Non-Chronically Homeless
1 0
12 15
92 1
4 4
101
5 23
10 394
0 50 100 150 200 250 300 350 400 450
Yorba Linda
Villa Park
Stanton
Placentia
Orange
Los Alamitos
La Palma
La Habra
Fullerton
Cypress
Buena Park
Brea
Anaheim
Number of Clients
City

8 Racial Equity Analysis – YTD
Populations Served*
Note: The 2023 HMIS Data Standards are utilized in the chart below to report race and ethnicity. The reporting of race and ethnicity is presented differently and does not align with the current 2024 HMIS Data Standards.
0% 10% 20% 30% 40% 50% 60% 70% 80%
White
B l a c k , A f r i c a n A m e r i c a n , o r A f r i c a n Asi an or Asi an Ameri can
Ameri can Indi an, Al aska Nati ve, or
Indi genous
Nati ve Hawai i an or Paci fi c Islander
Multi-Racial
Hi spani c/Latina/e/o
White
Black,
African
American,
or African
Asian or
Asian
American
American
Indian,
Alaska
Native, or
Indigenous
Native
Hawaiian or
Pacific
Islander
Multi-Racial Hispanic/La
tina/e/o
2022 PIT (Unsheltered and Sheltered
total) 71% 8% 3% 4% 1% 13% 0%
Racial Representation of Bridges at
Kraemer Place Guests (YTD) 68% 14% 4% 4% 2% 2% 5%

9 Exit Destination Type by Racial Categories compared to Racial Representation of Bridges at Kraemer Place Shelter Population
*Racial Categories based on 2024 HMIS Data Standards effective October 1, 2023 57%
9%
2% 0% 2% 0% 0%
30%
39%
13%
4% 1% 2% 0%
5%
36%
0%
10%
20%
30%
40%
50%
60%
Permanent Destinations
Racial Representation of Guests Exiting to Destination Type Racial Representation of Bridges at Kraemer Place Guests (YTD)

10 38%
25%
0% 0% 0% 0% 0%
39% 38%
13%
4%
1% 2% 0%
5%
36%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Temporary Destinations
Racial Representation of Guests Exiting to Destination Type Racial Representation of Bridges at Kraemer Place Guests (YTD) 38%
9%
4%
1% 3% 1%
6%
39% 40%
13%
4%
1% 2% 0%
5%
36%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Homeless Destinations
Racial Representation of Guests Exiting to Destination Type Racial Representation of Bridges at Kraemer Place Guests (YTD)

11 34%
16%
1% 0% 1% 0%
6%
42%
39%
13%
4%
1% 2% 0%
5%
36%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Unknown Destinations
Racial Representation of Guests Exiting to Destination Type Racial Representation of Bridges at Kraemer Place Guests (YTD)

COMMUNITY DEVELOPMENT DEPARTMENT
DATE: AUGUST 6, 2024
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: NATE FARNSWORTH, COMMUNITY DEVELOPMENT DIRECTOR
PREPARED BY: NICHOLE VALDEZ, ADMINISTRATIVE SECRETARY
SUBJECT: PUBLIC HEARING ON ISSUANCE OF TAX-EXEMPT BONDS FOR VILLA

PLUMOSA APARTMENTS, A RESOLUTION APPROVING THE CITY OF

YORBA LINDA TO JOIN THE CALIFORNIA STATEWIDE COMMUNITIES

DEVELOPMENT AUTHORITY AND A RESOLUTION APPROVING THE

ISSUANCE OF BONDS

RECOMMENDATION
It is recommended that the City Council:

1. Adopt Resolution No. 2024-5910, approving the City of Yorba Linda to join the California Statewide Communities Development Authority.

2. Conduct a Tax Equity and Fiscal Responsibility Act Hearing in consideration of the issuance of tax-exempt bond financing by the California Statewide Communities Development Authority for the benefit of National Community Renaissance of California (or an affiliate thereof), to provide financing for the acquisition, rehabilitation, improvement, and equipping of a 75-unit multifamily rental housing project generally known as Villa Plumosa Apartments.

3. Adopt Resolution No. 2024-5911, approving the issuance of Bonds by the California Statewide Communities Development Authority not to exceed $60,000,000, for the benefit of National Community Renaissance of California (or an affiliate thereof), to provide financing for the acquisition, rehabilitation, improvement, and equipping of a 75-unit multifamily rental housing project generally known as Villa Plumosa Apartments.

BACKGROUND
National Community Renaissance of California (or an affiliate thereof) (the “Borrower”) has requested that the California Statewide Communities Development Authority (“CSCDA”) serve as the municipal issuer of tax-exempt multi-family housing revenue bonds in an aggregate principal amount not to exceed $60,000,000 (the “Bonds”). The proceeds of the Bonds will be used for the purpose of making a loan to the Borrower, to enable the Borrower

PUBLIC HEARING ON ISSUANCE OF TAX-EXEMPT BONDS FOR VILLA PLUMOSA

APARTMENTS, A RESOLUTION APPROVING THE CITY OF YORBA LINDA TO JOIN

THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY AND A

RESOLUTION APPROVING THE ISSUANCE OF BONDS
P a g e | 2
to finance the acquisition, rehabilitation, improvement and equipping of a 75-unit affordable multifamily housing rental project located at 4672 Plumosa Drive, Yorba Linda, California (the “Project”), which will be owned and operated by the Borrower. On December 6, 2023, the project received an award of private activity bond allocation from the California Debt Limit Allocation Committee

DISCUSSION
In order for all or a portion of the Bonds to qualify as tax-exempt bonds, the City of Yorba Linda (“City”) must conduct a public hearing (the “TEFRA Hearing”) providing the members of the community an opportunity to speak in favor of or against the use of tax-exempt bonds for the financing of the Project. Adoption of the resolution is solely for the purposes of satisfying the requirements of the Tax Equity and Fiscal Responsibility Act (TEFRA), the Internal Revenue Code and the California Government Code Section 6500 (and following).

Prior to such TEFRA Hearing, reasonable notice must be provided to the members of the community. Following the close of the TEFRA Hearing, an “applicable elected representative” of the governmental unit hosting the Project must provide its approval of the issuance of the Bonds for the financing of the Project. A public notice was published on July 25, 2024 (Attachment 1).

CSCDA is a joint exercise of powers authority created under the California Joint Powers Act (California Government Code Section 6500 and following). Pursuant to the Act and an Amended and Restated Joint Powers Agreement among a number of cities, counties and special districts within the State of California (the “Agreement”), CSCDA is authorized to issue revenue bonds and certificates of participation for the benefit of conduit borrowers.

CSCDA is comprised of more than 530 members. CSCDA has issued more than $75 billion through 1,800 plus financings since 1988 and consistently ranks in the top 10 of more than 3,000 nationwide public issuers of tax-exempt debt, as measured by annual issuance amount. By approving Resolution No. 2024-5910, the City Council is authorizing and directing the City to enter into the Agreement.

CSCDA issues bonds on behalf of the CSCDA member (the “Program Participant”) in whose jurisdiction the project is to be located, in this case, the City. Pursuant to Section 9 of the Agreement, CSCDA may not issue bonds or other forms of indebtedness unless the governing body of the Program Participant approves their issuance. Thereafter, pursuant to applicable state law, the bonds are issued as limited obligations of CSCDA, not of the City, payable solely out of the revenues and receipts derived from the applicable project or the loans made by CSCDA to the respective borrower with the proceeds of the bonds.

FISCAL IMPACT
There is no fiscal impact to the City. The Bonds will be issued as limited obligations of CSCDA, payable solely from revenues and receipts derived from a loan to be made by

PUBLIC HEARING ON ISSUANCE OF TAX-EXEMPT BONDS FOR VILLA PLUMOSA

APARTMENTS, A RESOLUTION APPROVING THE CITY OF YORBA LINDA TO JOIN

THE CALIFORNIA STATEWIDE COMMUNITIES DEVELOPMENT AUTHORITY AND A

RESOLUTION APPROVING THE ISSUANCE OF BONDS
P a g e | 3
CSCDA to the Borrower with the Bond proceeds. The City bears no liability with respect to the issuance of the Bonds. Further, the City is not a party to any of the financing documents related to the Bond issuance and is not named in any of the disclosure documents describing the Bonds or the proposed financing.

ALTERNATIVES
The City Council may choose not to adopt the Resolutions supporting the Villa Plumosa Apartments in which case the project proponent, National Community Renaissance of California will not be able to obtain bond financing through the proposed partnership with California Statewide Communities Development Authority. In this scenario, National Community Renaissance would likely be unable to obtain all of the financing necessary to complete the rehabilitation needed at the property to (i) repair two currently uninhabitable units that have suffered critical foundation damage, and (ii) perform construction to lift the buildings and compact the soil to correct and avoid further damage to the foundations of the buildings. Without this necessary rehabilitation it is uncertain whether future occupancy of the buildings could be impacted.

ATTACHMENTS
Exhibit A - Resolution No. 2024-5910
Exhibit B - Resolution No. 2024-5911

RESOLUTION NO. 2024-5910

RESOLUTION APPROVING, AUTHORIZING AND DIRECTING

EXECUTION OF AN AMENDED AND RESTATED JOINT EXERCISE OF

POWERS AGREEMENT RELATING TO THE CALIFORNIA STATEWIDE

COMMUNITIES DEVELOPMENT AUTHORITY
WHEREAS, the City of Yorba Linda, California (the “City”), has expressed an interest in participating in the economic development financing programs (the “Programs”) in conjunction with the parties to that certain Amended and Restated Joint Exercise of Powers Agreement Relating to the California Statewide Communities Development Authority, dated as of June 1, 1988 (the “Agreement”); and
WHEREAS, there is now before this City Council the form of the Agreement; and WHEREAS, the City proposes to participate in the Programs and desires that certain projects to be located within the City be financed pursuant to the Programs and it is in the public interest and for the public benefit that the City do so; and WHEREAS, the Agreement has been filed with the City Clerk, and the members of the City Council of the City, with the assistance of its staff, have reviewed said document.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YORBA LINDA AS FOLLOWS:

Section 1. The Agreement is hereby approved and the Mayor of the City is hereby authorized and directed to execute said document, with such changes, insertions and omissions as may be approved by said City Council, and the City Clerk is hereby authorized and directed to affix the City’s seal to said document and to attest thereto.

Section 2. The Mayor of the City, the City Clerk and all other proper officers and officials of the City are hereby authorized and directed to execute such other agreements, documents and certificates, and to perform such other acts and deeds, as may be necessary or convenient to effect the purposes of this Resolution and the transactions herein authorized.

Section 3. The City Clerk shall forward a certified copy of this Resolution and an originally executed Agreement to:

Kathleen Jacobe
Orrick, Herrington & Sutcliffe LLP
400 Capital Mall, Suite 3000
Sacramento, California 95814
Section 4. This resolution shall take effect immediately upon its passage.

RESOLUTION NO. 2024-5910
PAGE NO. 2
PASSED, APPROVED AND ADOPTED by the City Council of the City of Yorba Linda, on the 6th day of August, 2024.
________________________________

TARA CAMPBELL, MAYOR

CITY OF YORBA LINDA
ATTEST:
________________________________

MARCIA BROWN, CITY CLERK

CITY OF YORBA LINDA
APPROVED AS TO FORM:

RUTAN & TUCKER, LLP
_______________________________

CITY ATTORNEY

COUNTY OF ORANGE )
ss

STATE OF CALIFORNIA )
I, MARCIA BROWN, City Clerk of the City of Yorba Linda, California, DO HEREBY CERTIFY that the foregoing Resolution was adopted at a regular meeting of the City Council of the City of Yorba Linda held on the 6th day of August, 2024, and was carried by the following roll call vote:
________________________________

MARCIA BROWN, CITY CLERK

CITY OF YORBA LINDA

RESOLUTION NO. 2024-5911

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF YORBA

LINDA APPROVING THE ISSUANCE BY THE CALIFORNIA STATEWIDE

COMMUNITIES DEVELOPMENT AUTHORITY OF EXEMPT FACILITY

BONDS FOR A QUALIFIED RESIDENTIAL RENTAL PROJECT FOR THE

VILLA PLUMOSA APARTMENTS
WHEREAS, the California Statewide Communities Development Authority (the "Authority") is authorized pursuant to the provisions of California Government Code Section 6500 et seq. and the terms of an Amended and Restated Joint Exercise of Powers Agreement, dated as of June 1, 1988 (the "Agreement"), among certain local agencies throughout the State of California, including the City of Yorba Linda (the "City"), to issue revenue bonds in accordance with Chapter 7 of Part 5 of Division 31 of the California Health and Safety Code for the purpose of financing multifamily rental housing projects; and WHEREAS, VP2 Apartments, LP or a partnership of which National Community Renaissance of California (the "Developer") or a related person to the Developer is the general partner, has requested that the Authority adopt a plan of financing providing for the issuance of exempt facility bonds for a qualified residential rental project pursuant to Section 142(a)(7) of the Internal Revenue Code of 1986 (the "Code") in one or more series issued from time to time, including bonds issued to refund such exempt facility bonds in one or more series from time to time, and at no time to exceed $60,000,000 in outstanding aggregate principal amount (the "Bonds"), to finance or refinance the acquisition, rehabilitation and development of a multifamily rental housing project located at 4672 Plumosa Drive, Yorba Linda, California (the "Project"); and WHEREAS, pursuant to Section 147(f) of the Code, prior to their issuance, the Bonds are required to be approved by the "applicable elected representative" of the governmental units on whose behalf such bonds are expected to be issued and by a governmental unit having jurisdiction over the entire area in which any facility financed by such bonds is to be located, after a public hearing held following reasonable public notice; and WHEREAS, the members of this City Council (this "City Council") are the applicable elected representatives of the City; and
WHEREAS, there has been published, at least 7 days prior to the date hereof, in a newspaper of general circulation within the City, a notice that a public hearing regarding the Bonds would be held on a date specified in such notice; and WHEREAS, such public hearing was conducted on such date, at which time an opportunity was provided to interested parties to present arguments both for and against the issuance of the Bonds; and
WHEREAS, the Authority is also requesting that the City Council approve the issuance of any refunding bonds hereafter issued by the Authority for the purpose of

RESOLUTION NO. 2024-5911
PAGE NO. 2
refinancing the Bonds which financed the Project (the "Refunding Bonds"), but only in such cases where federal tax laws would not require additional consideration or approval by the City Council; and
WHEREAS, it is intended that this resolution shall constitute the approval of the issuance of the Bonds required by Section 147(f) of the Code and Section 9 of the Agreement;

NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF YORBA LINDA AS FOLLOWS:

Section 1. The above recitals are true and correct.

Section 2. The City Council hereby approves the issuance of the Bonds and the Refunding Bonds by the Authority. It is the purpose and intent of the City Council that this resolution constitute approval of the Bonds for the purposes of (a) Section 147(f) of the Code and (b) Section 9 of the Agreement.

Section 3. The officers of the City are hereby authorized and directed, jointly and severally, to do any and all things and to execute and deliver any and all documents that they deem necessary or advisable in order to carry out, give effect to and comply with the terms and intent of this resolution and the financing approved hereby.

Section 4. This resolution shall take effect immediately upon its passage.

PASSED, APPROVED AND ADOPTED by the City Council of the City of Yorba Linda, on the 6th day of August, 2024.
________________________________

TARA CAMPBELL, MAYOR

CITY OF YORBA LINDA
ATTEST:
_________________________________

MARCIA BROWN, CITY CLERK

CITY OF YORBA LINDA
APPROVED AS TO FORM:

RUTAN & TUCKER, LLP
_________________________________

CITY ATTORNEY

RESOLUTION NO. 2024-5911
PAGE NO. 3

COUNTY OF ORANGE )
ss

STATE OF CALIFORNIA )
I, MARCIA BROWN, City Clerk of the City of Yorba Linda, California, DO HEREBY CERTIFY that the foregoing Resolution was adopted at a regular meeting of the City Council of the City of Yorba Linda held on the 6th day of August, 2024, and was carried by the following roll call vote:
________________________________

MARCIA BROWN, CITY CLERK

CITY OF YORBA LINDA

COMMUNITY DEVELOPMENT DEPARTMENT
DATE: AUGUST 6, 2024
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: NATE FARNSWORTH, COMMUNITY DEVELOPMENT DIRECTOR
PREPARED BY: NICHOLE VALDEZ, ADMINISTRATIVE SECRETARY
SUBJECT: RESYNDICATION AND REHABILITATION OF THE VILLA PLUMOSA

APARTMENTS

RECOMMENDATION
It is recommended that City Council approve the transfer of the Villa Plumosa Apartments located at 4672 Plumosa Drive and the transfer and assignment of the $12,976,406 loan made by the City of Yorba Linda (“City Loan”) to Yorba Linda Housing Partners, LP (Current Owner) in connection with the Current Owner’s development of the Villa Plumosa Apartments to VP2 Apartments LP, the new partnership that has been established by National Community Renaissance of California ("National CORE") for the resyndication and rehabilitation of the Villa Plumosa Apartments.

EXECUTIVE SUMMARY
Yorba Linda Housing Partners, LP, a partnership established by National CORE, is the current owner of the Villa Plumosa Apartments. National CORE is one of the nation’s largest nonprofit affordable housing developers. The Villa Plumosa Apartments are experiencing a critical soil and foundation problem and require immediate renovation. National CORE applied to the California Tax Credit Allocation Committee (CTCAC) and the California Debt Limit Allocation Committee (CDLAC) for an allocation of 4% federal tax credit and bonds on September 6, 2023 and was awarded an allocation on December 6, 2023 to perform the renovation and resyndication (collectively, the “Project”).

BACKGROUND
Yorba Linda Housing Partners, a California limited partnership (the “Existing Partnership”), was formed on March 23, 2006, for the purpose of acquiring, financing, constructing, developing, renovating, rehabilitating, maintaining, and operating Villa Plumosa Apartments, a 76-unit affordable housing development located in Yorba Linda, California. The Villa Plumosa Apartments is required to be operated in a manner necessary to qualify for lowincome housing tax credits as described in Internal Revenue Code Section 42.

In 2008, the former City of Yorba Linda Redevelopment Agency made a $12,976,406 loan (“City Loan”) to the Existing Partnership in support of the development of the Villa Plumosa

RESYNDICATION AND REHABILITATION OF THE VILLA PLUMOSA APARTMENTS P a g e | 2
Apartments. Following an earlier repayment of $250,000 towards the principal amount of the City Loan, the current outstanding principal amount of the City Loan is approximately $12,726,406 plus accrued interest.

DISCUSSION
National CORE observed critical foundation damage in two residential units at the Villa Plumosa Apartments in 2023. Upon further inspection by an engineering firm, it was determined the Villa Plumosa Apartments were experiencing a soil problem that would require extensive construction to lift the buildings and compact the soil. It was also determined that both damaged units were no longer habitable for resident occupancy due to the floor sinking approximately 4 inches.

The residents of the affected units were relocated by National CORE. Both units have remained vacant since. Following discovery of the damage, National CORE began preparing an application for 4% Low Income Housing Tax Credits and tax-exempt bonds from the CTCAC and CDLAC.

On August 3, 2023, the City authorized National CORE to effectuate the transfer of the Apartments, and the transfer/assignment of the City Loan, from the Existing Partnership to a new partnership to be formed by National CORE (a “New Partnership”), subject to the City’s approval of organizational documents, the form of grant deed to effectuate the transfer of fee title to the New Partnership, and the form of an assignment and assumption agreement, all to be drafted during the construction closing process. National CORE has recently established VP2 Apartments LP as the New Partnership.

TEFRA HEARING
A public hearing under the Tax Equity Fiscal Responsibility Act (TEFRA) is required when state bonds are sought for construction or rehabilitation of housing, such as the Villa Plumosa Apartments resyndication. The TEFRA hearing is intended to provide the community input on any bond issuance hosted by City Council.

Under a separate Staff Report submitted to the City by the California Statewide Communities Development Authority (CSCDA) in its capacity as the bond issuer, a request for a TEFRA hearing was made to the City by CSCDA on behalf of National CORE (Developer). The CSCDA bonds are issued by the state and are not related to the City, City Loan or local government. The recommendations and specific details of such TEFRA hearing are included in the CSCDA Staff Report and these statements are for informational purposes only.

On July 20, 2023, National CORE received a bond inducement for $60,000,000, which exceeds the amount of funding the Project is expected to require. There are two reasons for the higher amount: (i) the inducement is completed early in the process, prior to solidifying development budget costs and the submittal of the CDLAC application, and (ii) a cushion is added in the event that when the CTCAC application is submitted the bond allocation amount increases from the initial projections.

RESYNDICATION AND REHABILITATION OF THE VILLA PLUMOSA APARTMENTS P a g e | 3
The CDLAC application requires evidence that the bond inducement process was completed. The amount of the CDLAC bond request must be equal to or less than the bond inducement amount. CDLAC program guidelines require that 50% of the total Project cost are financed with tax exempt bonds. The amount of tax-exempt bonds issued by CSCDA will be equal to the CDLAC allocation award and will not exceed that amount.

FISCAL IMPACT
The Villa Plumosa Apartments is scheduled to close on the tax credit financing in August 2024. The renovation will reduce operating expenses by installing energy upgrades throughout the Villa Plumosa Apartments, such as electric heat pumps and energy star appliances, in addition to interior unit upgrades. For the next 15 years, it is projected to have positive cash flow with a debt service coverage ratio between 1.20 – 1.50. The current total operating expenses per year are $817,287 and are projected to decrease to approximately $662,408 after the renovation.

A tax credit investor will be brought into the New Partnership through the resyndication, as originally occurred during the initial syndication in 2009, when the Villa Plumosa Apartments were built. The Villa Plumosa Apartments will have a new permanent loan, with continued payments of residual receipts to the City through annual net cash flow (as currently structured). The Villa Plumosa Apartments will remain affordable to low-income families within Yorba Linda and will continue to comply with the affordability restrictions required in both the City’s existing recorded regulatory agreement (which will not be affected by the rehabilitation/resyndication), and in the original tax-credit syndication/regulatory agreement with CTCAC. The renovation will include pressure grouting to address the soil problem and foundation repairs to the slab. The total direct construction costs are projected at $8,326,290. The Villa Plumosa Apartments are expected to receive approximately $15.4M in tax credit equity in connection with the Project.

The total estimated Project cost is $44,231,048. The Villa Plumosa Apartments received a bond allocation from CDLAC for the Project in the amount of $20,609,881 as of December 6, 2023. The tax credit equity and tax-exempt bonds will cover a portion of the renovation costs. The New Partnership will obtain construction and permanent debt to cover the remaining costs associated with the rehabilitation. The assumption by the New Partnership of the City of Yorba loan is considered funds allocated towards the acquisition price of the Villa Plumosa Apartments. The New Partnership’s assumption of said loans will include any accrued interest to the date of the assumption/transfer, and the loan terms will not be changed. In connection with the transfer of the Villa Plumosa Apartments, the existing AHP loan ($750,000) will be forgiven pursuant to its terms.

RESYNDICATION AND REHABILITATION OF THE VILLA PLUMOSA APARTMENTS P a g e | 4
EXISTING LOANS AS OF 7/25/24:

Lender
Original
Loan
Amount
Terms
Current
Loan
Balance
(with
accrued
interest)
JPM Chase $4,846,707 Permanent loan (property mortgage),

6.07 interest rate. $3,523,679
City of Yorba Linda $12,726,406 Residual receipt loan paid by net cash flow, 3% interest. $18,836,696
Federal Home Loan
Bank of San Francisco $750,000
Affordable Housing Program (AHP)
Loan, forgivable/no repayment
terms/non-interest bearing.
$750,000
PROPOSED PLAN OF EXISTING LOANS POST RESYNDICATION:

Lender Original Loan
Amount Terms
JPM Chase $4,846,707 To be paid off with construction loan financing City of Yorba Linda $12,726,406* To be assumed by/transferred to the New Partnership
Federal Home Loan
Bank of San
Francisco
$750,000 To be forgiven as of the closing of the resyndication *The original City Loan amount was $12,976,406, but an earlier repayment of $250,000 was applied towards the principal balance.

ALTERNATIVES
The City Council may choose not to approve the transfer of the Villa Plumosa Apartments and the transfer and assignment of the $12,976,406 City Loan from Yorba Linda Housing Partners, LP to VP2 Apartments LP, for the resyndication and rehabilitation of the Villa Plumosa Apartments, in which case the project proponent, National Community Renaissance of California will not be able to obtain bond financing through the proposed partnership with California Statewide Communities Development Authority. In this scenario, National Community Renaissance would likely be unable to obtain all of the financing necessary to complete the rehabilitation needed at the property to (i) repair two currently inhabitable units that have suffered critical foundation damage, and (ii) perform construction to lift the buildings and compact the soil to correct and avoid further damage to the foundations of the buildings. Without this necessary rehabilitation it is uncertain whether future occupancy of the buildings could be impacted.

RESYNDICATION AND REHABILITATION OF THE VILLA PLUMOSA APARTMENTS P a g e | 5

ATTACHMENTS
Exhibit A – Projected 15 Yr. Cash Flow Summary (post resyndication) Exhibit B – Historical Residual Receipt Payment History on the City Loan Exhibit C – Development Budget

EXHIBIT A

EXHIBIT A

EXHIBIT B

EXHIBIT C

ADMINISTRATION DEPARTMENT
DATE: AUGUST 6, 2024
TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL
FROM: TODD LITFIN, CITY ATTORNEY
PREPARED BY: DAVID CHRISTIAN, ASSISTANT CITY MANAGER
SUBJECT: ELEVENTH AMENDMENT TO CITY MANAGER EMPLOYMENT

AGREEMENT

RECOMMENDATION
It is recommended that the City Council review and approve the “Eleventh Amendment Employment Agreement” (“Eleventh Amendment”) that amends the City Manager’s employment agreement with the City and appropriate the necessary amounts in the FY 24- 25 budget.

BACKGROUND
On July 2, 2013 the City of Yorba Linda and City Manager Pulone entered into an Employment Agreement (“Original Agreement”) whereby Mr. Pulone was employed as City Manager for the City pursuant to the terms and conditions set forth in the Original Agreement. The Original Agreement has since been amended ten times – on October 7, 2014 (First Amendment), on October 6, 2015 (Second Amendment), on November 15, 2016 (Third Amendment), on September 19, 2017 (Fourth Amendment), on October 2, 2018 (Fifth Amendment), on August 6, 2019 (Sixth Amendment), on September 15, 2020 (Seventh Amendment), on December 7, 2021 (Eighth Amendment), on October 4, 2022 (Ninth Amendment) and on August 15, 2023 (Tenth Amendment).

DISCUSSION
The Eleventh Amendment updates the following matter pertaining to the terms of employment for the City Manager: A cost of living (COLA) increase of 6.0%, effective July 1, 2024, as received by all City employees. All other terms of the contract will remain unchanged.

FISCAL IMPACT
The salary increase equates to $17,352.79 per year bringing the total annual salary to $306,565.96. An appropriation will be made to the current year’s budget as necessary.

ELEVENTH AMENDMENT TO CITY MANAGER EMPLOYMENT AGREEMENT P a g e | 2

ALTERNATIVES
Do not approve the Eleventh Amendment to the City Manager Employment Agreement.

ATTACHMENTS

1. Original Employment Agreement

2. First Amendment Employment Agreement

3. Second Amendment Employment Agreement

4. Third Amendment Employment Agreement

5. Fourth Amendment Employment Agreement

6. Fifth Amendment Employment Agreement

7. Sixth Amendment Employment Agreement

8. Seventh Amendment Employment Agreement

9. Eighth Amendment Employment Agreement

10. Ninth Amendment Employment Agreement

11. Tenth Amendment Employment Agreement

12. Proposed Eleventh Amendment Employment Agreement

FIFTH AMENDMENT

EMPLOYMENT AGREEMENT
This Fifth Amendment Employment Agreement between the City of Yorba Linda(" City") and Mark Pulone(" Pulone" or" Manager")(" Fifth Amendment Employment Agreement") is made this 2nd day of October, 2018.

RECITALS
A. City and Manager entered into an Employment Agreement dated July 2, 2013 Original Agreement"), a First Amendment Employment Agreement dated October 7, 2014, a Second Amendment Employment Agreement dated October 6, 2015, a Third Amendment Employment Agreement dated November 15, 2016, and a Fourth Amendment Employment Agreement dated September 19, 2017, whereby Pulone was employed as City Manager for the City of Yorba Linda pursuant to the terms and conditions set forth in Original Agreement as subsequently amended.

B. Manager desires to continue serving as City Manager of the City of Yorba Linda, and the City desires to continue Pulone as City Manager of the City of Yorba Linda on the terms and conditions set forth in the Original Agreement, subject to the amendments and modifications hereinafter stated.

C. The City desires to enter into a five ( 5) year contract with Pulone as City Manager of the City of Yorba Linda with a period October 2, 2018, through and including October 1, 2023.

AGREEMENT
NOW, THEREFORE, the parties agree to the following amendment to the terms and conditions of Manager' s employment:
539/ 009410- 1001
12880165. 1 a09/ 24/ 18

1. Section 4( a) Salary is amended to state:

Effective October 1, 2018, City Council grants Manager an increase in his current base salary of $241, 022. 00 based on merit and performance in accordance with the provisions of Section 4( a) of Original Agreement. The merit and performance increase is

2. 5%. Therefore, effective October 1, 2018, City agrees to pay Manager an annual base salary, exclusive of benefits, in the sum of 247, 047. 55, payable in installments at the same time and by the same methods as other City employees are regularly paid. In addition thereto, at least thirty ( 30) days prior to Manager' s Anniversary Date ( August 5th), the Council shall conduct a performance evaluation of Manager, and if a majority ofthe Council deems Manager to have successfully performed up to the
Anniversary Date may, in their sole discretion, grant Manager an increase in base salary based on merit and performance consistent with the City' s compensation policy in effect at the time of said increase. City and Manager agree to review Manager' s salary and benefits at the time of Manager' s performance evaluation in 2019 and subsequent years thereafter.

Council may, in its discretion, reduce the salary of Manager due to budgetary constraints, on condition that any such reduction shall not exceed the average reduction applicable to all management employees ofthe City at the time ofreduction and Manager' s salary. 539/ 009410- 1001
12880165. 1 a09/ 24/ 18 2-

Furthermore, Manager, in his sole discretion may elect not to receive any salary increase that may be granted hereunder; provided, however, if Manager elects not to receive a salary increase provided hereunder, said salary increase shall be subsequently implemented, on a prospective basis only, upon written request of Manager."

2. Section 11 ENTIRE AGREEMENT is amended to state:

Except as herein stated, all other terms and conditions of the Original Employment Agreement dated July 2, 2013, as amended in the First Amendment Employment Agreement dated October 7, 2014, as amended in the Second Amendment Employment
Agreement dated October 6, 2015, as amended in the Third Amendment Employment Agreement dated November 15, 2016, and as amended in the Fourth Amendment Employment Agreement dated September 19, 2017, shall remain in full force and effect until changed or terminated pursuant to the provisions of Section 3 of Original Employment Agreement.

This First, Second, Third, Fourth and Fifth Amendment
Employment Agreement and Original Employment Agreement
contain the Entire Agreement between the parties concerning the subject matters set forth therein, and no promise, representation, warranty or covenant not included in this Fifth Amendment Employment Agreement, Fourth Amendment Employment
Agreement, Third Amendment Employment Agreement, Second 539/ 009410- 1001
12880165. 1 a09/ 24/ 18 3-

Amendment Employment Agreement, First Amended Employment Agreement or Original Employment Agreement have been or is relied upon by any party hereto concerning the offer and acceptance of employment described therein."

3. Section 13 EFFECTIVE DATE AND TERM is amended to state:

The Effective Date of this Fifth Amendment Employment
Agreement is October 2, 2018, and the term is for five( 5) years until October 1, 2023.

IN WITNESS WHEREOF, the parties hereto have executed this Fifth Amendment Employment Agreement as of the date first set forth hereinabove.

Date: October 2, 2018
Fifth Amendment Employment Agreement approved by City Council in open session at a regular City Council meeting and reflected in the minutes pursuant to Government Code sections 53262 and 54956( b).

C iY 1 MANAGER:
1 Gene Hernandez, Mayor Mark Pulone
ATTEST:
1Y)(- 1. L/ 1.t__- t a ' v ' a L
City Clerk
APPROVED AS TO FORM:
ad/
Todd Lit in, City Attorney
539/ 009410- 1001
12880165. 1 a09/ 24/ 18 4-

SIXTH AMENDMENT

EMPLOYMENT AGREEMENT
This Sixth Amendment Employment Agreement between the City of Yorba Linda(" City") and Mark Pulone (" Pulone" or " Manager") (" Sixth Amendment Employment Agreement") is made this 6th day ofAugust, 2019.

RECITALS
A. City and Manager entered into an Employment Agreement dated July 2, 2013 Original Agreement"), a First Amendment Employment Agreement dated October 7, 2014, a Second Amendment Employment Agreement dated October 6, 2015, a Third Amendment Employment Agreement dated November 15, 2016, a Fourth Amendment Employment Agreement dated September 19, 2017, and a Fifth Amendment Employment Agreement dated October 2, 2018, whereby Pulone was employed as City Manager for the City of Yorba Linda pursuant to the terms and conditions set forth in Original Agreement as subsequently amended.

B. Manager desires to continue serving as City Manager of the City of Yorba Linda, and the City desires to continue Pulone as City Manager of the City of Yorba Linda on the terms and conditions set forth in the Original Agreement, subject to the amendments and modifications hereinafter stated.

AGREEMENT
NOW, THEREFORE, the parties agree to the following amendment to the terms and conditions of Manager' s employment:

1. Section 4( a) Salary is amended to state:
539/ 009410- 1001
13983150. 1 a07/ 25/ 19

Effective October 1, 2019, City Council grants Manager an increase in his current base salary of$ 247, 047. 55 based on merit and performance in accordance with the provisions of Section 4( a) of Original Agreement. The merit and performance increase is

2. 5%. Therefore, effective October 1, 2019, City agrees to pay Manager an annual base salary, exclusive of benefits, in the sum of 253, 223. 74, payable in installments at the same time and by the same methods as other City employees are regularly paid. In addition thereto, at least thirty ( 30) days prior to Manager' s Anniversary Date ( August 5th), the Council shall conduct a performance evaluation of Manager, and if a majority of the Council deems Manager to have successfully performed up to the
Anniversary Date may, in their sole discretion, grant Manager an increase in base salary based on merit and performance consistent with the City' s compensation policy in effect at the time of said increase. City and Manager agree to review Manager' s salary and benefits at the time of Manager' s performance evaluation in 2019 and subsequent years thereafter.

Council may, in its discretion, reduce the salary of Manager due to budgetary constraints, on condition that any such reduction shall not exceed the average reduction applicable to all management employees of the City at the time of reduction and Manager' s salary.

Furthermore, Manager, in his sole discretion may elect not to receive 539/ 009410- 1001
13983150. 1 a07/ 25/ 19 2-

any salary increase that may be granted hereunder; provided, however, if Manager elects not to receive a salary increase provided hereunder, said salary increase shall be subsequently implemented, on a prospective basis only, upon written request of Manager."

2. Section 11 ENTIRE AGREEMENT is amended to state:

Except as herein stated, all other terms and conditions of the Original Employment Agreement dated July 2, 2013, as amended in the First Amendment Employment Agreement dated October 7, 2014, as amended in the Second Amendment Employment
Agreement dated October 6, 2015, as amended in the Third Amendment Employment Agreement dated November 15, 2016, as amended in the Fourth Amendment Employment Agreement dated September 19, 2017, and as amended in the Fifth Amendment Employment Agreement dated October 2, 2018, shall remain in full force and effect until changed or terminated pursuant to the provisions of Section 3 of Original Employment Agreement.

This First, Second, Third, Fourth, Fifth and Sixth
Amendment Employment Agreement and Original Employment
Agreement contain the Entire Agreement between the parties concerning the subject matters set forth therein, and no promise, representation, warranty or covenant not included in this Sixth Amendment Employment Agreement, Fifth Amendment
Employment Agreement, Fourth Amendment Employment
539/ 009410- 1001
13983150. 1 a07/ 25/ 19 3-

Agreement, Third Amendment Employment Agreement, Second Amendment Employment Agreement, First Amended Employment Agreement or Original Employment Agreement have been or is relied upon by any party hereto concerning the offer and acceptance of employment described therein."
IN WITNESS WHEREOF, the parties hereto have executed this Sixth Amendment Employment Agreement as of the date first set forth hereinabove.

Date: August 6, 2019
Sixth Amendment Employment Agreement approved by City Council in open session at a regular City Council meeting and reflected in the minutes pursuant to Government Code sections 53262 and 54956( b).

CITY: MANAGER:
fa Camp. ell,/ ayor Mark Pulone
ATTEST:
2 ,
AAS__(Ci" L tip
City Clerk
APPROVED AS TO FORM:

Todd Litfi , City Attorney
539/ 009410- 1001
13983150. 1 a07/ 25/ 19 4-

SEVENTH AMENDMENT

EMPLOYMENT AGREEMENT
This Seventh Amendment Employment Agreement between the City of Yorba Linda City") and Mark Pulone (" Pulone" or " Manager") (" Seventh Amendment Employment Agreement") is made this 15th day of September, 2020.

RECITALS
A. City and Manager entered into an Employment Agreement dated July 2, 2013 Original Agreement"), a First Amendment Employment Agreement dated October 7, 2014, a Second Amendment Employment Agreement dated October 6, 2015, a Third Amendment Employment Agreement dated November 15, 2016, a Fourth Amendment Employment Agreement dated September 19, 2017, a Fifth Amendment Employment Agreement dated October 2, 2018, and a Sixth Amendment Employment Agreement dated August 6, 2019, whereby Pulone was employed as City Manager for the City of Yorba Linda pursuant to the terms and conditions set forth in Original Agreement as subsequently amended.

B. Manager desires to continue serving as City Manager of the City of Yorba Linda, and the City desires to continue Pulone as City Manager of the City of Yorba Linda on the terms and conditions set forth in the Original Agreement, subject to the amendments and modifications hereinafter stated.

AGREEMENT
NOW, THEREFORE, the parties agree to the following amendment to the terms and conditions ofManager' s employment:

1. Section 4( a) Salary is amended to state:
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Effective October 1, 2020, City Council grants Manager an increase in his current base salary of$253,223. 74 based on merit and performance in accordance with the provisions of Section 4( a) of Original Agreement. The merit and performance increase is

2. 5%. Therefore, effective October 1, 2020, City agrees to pay Manager an annual base salary, exclusive of benefits, in the sum of 259, 554. 33, payable in installments at the same time and by the same methods as other City employees are regularly paid. In addition thereto, at least thirty ( 30) days prior to Manager' s Anniversary Date ( August 5th), the Council shall conduct a performance evaluation ofManager, and ifa majority ofthe Council deems Manager to have successfully performed up to the
Anniversary Date may, in their sole discretion, grant Manager an increase in base salary based on merit and performance consistent with the City' s compensation policy in effect at the time of said increase. City and Manager agree to review Manager' s salary and benefits at the time of Manager' s performance evaluation in 2020 and subsequent years thereafter.

Council may, in its discretion, reduce the salary of Manager due to budgetary constraints, on condition that any such reduction shall not exceed the average reduction applicable to all management employees ofthe City at the time ofreduction and Manager' s salary.

Furthermore, Manager, in his sole discretion may elect not to receive 539/ 009410- 1001
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any salary increase that may be granted hereunder; provided, however, if Manager elects not to receive a salary increase provided hereunder, said salary increase shall be subsequently implemented, on a prospective basis only, upon written request of Manager."

2. Section 11 ENTIRE AGREEMENT is amended to state:

Except as herein stated, all other terms and conditions of the Original Employment Agreement dated July 2, 2013, as amended in the First Amendment Employment Agreement dated October 7, 2014, as amended in the Second Amendment Employment
Agreement dated October 6, 2015, as amended in the Third Amendment Employment Agreement dated November 15, 2016, as amended in the Fourth Amendment Employment Agreement dated September 19, 2017, as amended in the Fifth Amendment
Employment Agreement dated October 2, 2018, and as amended in the Sixth Amendment Employment Agreement dated August 6, 2019, shall remain in full force and effect until changed or terminated pursuant to the provisions of Section 3 of Original Employment Agreement.

This First, Second, Third, Fourth, Fifth, Sixth, and Seventh Amendment Employment Agreement and Original Employment
Agreement contain the Entire Agreement between the parties concerning the subject matters set forth therein, and no promise, representation, warranty or covenant not included in this Seventh 539/ 009410- 1001
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Amendment Employment Agreement, Sixth Amendment
Employment Agreement, Fifth Amendment Employment
Agreement, Fourth Amendment Employment Agreement, Third Amendment Employment Agreement, Second Amendment
Employment Agreement, First Amended Employment Agreement or Original Employment Agreement have been or is relied upon by any party hereto concerning the offer and acceptance ofemployment described therein."
IN WITNESS WHEREOF, the parties hereto have executed this Seventh Amendment Employment Agreement as of the date first set forth hereinabove.

Date: September 15, 2020
Seventh Amendment Employment Agreement approved by City Council in open session at a regular City Council meeting and reflected in the minutes pursuant to Government Code sections 53262 and 54956( b).

CITY: MANAGER:

Beth Haney, Mayor Mark Pulone
ATTEST:

C0' City Clerk
APPROVED AS TO FORM:
rcOd
Todd Litfi , City Attorney
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EIGHTH AMENDMENT

EMPLOYMENT AGREEMENT
This Eighth Amendment Employment Agreement between the City of Yorba Linda City") and Mark Pulone (" Pulone" or " Manager") (" Eighth Amendment Employment Agreement") is made this 7th day of December, 2021.

RECITALS
A. City and Manager entered into an Employment Agreement dated July 2, 2013 Original Agreement"), a First Amendment Employment Agreement dated October 7, 2014, a Second Amendment Employment Agreement dated October 6, 2015, a Third Amendment Employment Agreement dated November 15, 2016, a Fourth Amendment Employment Agreement dated September 19, 2017, a Fifth Amendment Employment Agreement dated October 2, 2018, a Sixth Amendment Employment Agreement dated August 6, 2019, and a Seventh Amendment Employment Agreement dated September 15, 2020, whereby Pulone was employed as City Manager for the City of Yorba Linda pursuant to the terms and conditions set forth in Original Agreement as subsequently amended.

B. Manager desires to continue serving as City Manager of the City of Yorba Linda, and the City desires to continue Pulone as City Manager of the City of Yorba Linda on the terms and conditions set forth in the Original Agreement, subject to the amendments and modifications hereinafter stated.

AGREEMENT
NOW, THEREFORE, the parties agree to the following amendment to the terms and conditions of Manager' s employment:
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1. Section 4( a) Salary is amended to state:

Effective October 1, 2021, City Council grants Manager an increase in his current base salary of $259, 554. 33 based on merit and performance in accordance with the provisions of Section 4( a) of Original Agreement. The merit and performance increase is

2. 0%. Therefore, effective October 1, 2021, City agrees to pay Manager an annual base salary, exclusive of benefits, in the sum of 264, 745. 42, payable in installments at the same time and by the same methods as other City employees are regularly paid. In addition thereto, at least thirty( 30) days prior to Manager' s Anniversary Date ( August 5th), the Council shall conduct a performance evaluation ofManager, and ifa majority ofthe Council deems Manager to have successfully performed up to the
Anniversary Date may, in their sole discretion, grant Manager an increase in base salary based on merit and performance consistent with the City' s compensation policy in effect at the time of said increase. City and Manager agree to review Manager' s salary and benefits at the time of Manager' s performance evaluation in 2022 and subsequent years thereafter.

Council may, in its discretion, reduce the salary of Manager due to budgetary constraints, on condition that any such reduction shall not exceed the average reduction applicable to all management employees ofthe City at the time of reduction and Manager' s salary. 539/ 009410- 1019
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Furthermore, Manager, in his sole discretion may elect not to receive any salary increase that may be granted hereunder; provided, however, if Manager elects not to receive a salary increase provided hereunder, said salary increase shall be subsequently implemented, on a prospective basis only, upon written request of Manager." One -Time Off -Salary Schedule Non-PERSable Bonus of 4%:

City shall also pay Manager a one- time off -salary schedule bonus of 4% calculated on Manager' s salary in the amount of $10, 589. 81.

Payment shall be made on the next regular payment date for all employees ofthe City following City Council approval ofthe Eighth Amendment Employment Agreement at a regular City Council meeting. It is the specific intent ofthe parties that this one-time off - salary schedule payment shall not be characterized as and shall not be reportable to Ca1PERS as compensation or compensation earnable within the definitions of Government Code §§ 20630, 20636, and 20636. 1.

2. Section 11 ENTIRE AGREEMENT is amended to state:

Except as herein stated, all other terms and conditions of the Original Employment Agreement dated July 2, 2013, as amended in the First Amendment Employment Agreement dated October 7, 2014, as amended in the Second Amendment Employment
Agreement dated October 6, 2015, as amended in the Third Amendment Employment Agreement dated November 15, 2016, as 539/ 009410- 1019
17225908. 1 a12/ 07/ 21 - 3-

amended in the Fourth Amendment Employment Agreement dated September 19, 2017, as amended in the Fifth Amendment
Employment Agreement dated October 2, 2018, as amended in the Sixth Amendment Employment Agreement dated August 6, 2019, and as amended in the Seventh Amendment Employment
Agreement dated September 15, 2020, shall remain in full force and effect until changed or terminated pursuant to the provisions of Section 3 of Original Employment Agreement.

This First, Second, Third, Fourth, Fifth, Sixth, Seventh and Eighth Amendment Employment Agreement and Original
Employment Agreement contain the Entire Agreement between the parties concerning the subject matters set forth therein, and no promise, representation, warranty or covenant not included in this Eighth Amendment Employment Agreement, Seventh Amendment Employment Agreement, Sixth Amendment Employment
Agreement, Fifth Amendment Employment Agreement, Fourth Amendment Employment Agreement, Third Amendment
Employment Agreement, Second Amendment Employment
Agreement, First Amended Employment Agreement or Original Employment Agreement have been or is relied upon by any parry hereto concerning the offer and acceptance of employment described therein."
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3. Section 13 EFFECTIVE DATE AND TERM is amended to state:

The Effective Date of this Eighth Amendment Employment
Agreement is October 1, 2021, and the term is for three ( 3) years until September 30, 2024.

IN WITNESS WHEREOF, the parties hereto have executed this Eighth Amendment Employment Agreement as of the date first set forth hereinabove.

Date: December 7th 2021
Eighth Amendment Employment Agreement approved by City Council in open session at a regular City Council meeting and reflected in the minutes pursuant to Government Code sections 53262 and 54956( b).

CITY:
f
Mayor
ATTEST:

QA a--
City Clerk
APPROVED AS TO FORM:
l
Todd Litfin, City Attorney
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MANAGER:

Mark Pulone

NINTH AMENDMENT

EMPLOYMENT AGREEMENT
This Ninth Amendment Employment Agreement between the City ofYorba Linda(" City") and Mark Pulone (" Pulone" or " Manager") (" Ninth Amendment Employment Agreement") is made this 4th day of October, 2022.

RECITALS
A. City and Manager entered into an Employment Agreement dated July 2, 2013 Original Agreement"), a First Amendment Employment Agreement dated October 7, 2014, a Second Amendment Employment Agreement dated October 6, 2015, a Third Amendment Employment Agreement dated November 15, 2016, a Fourth Amendment Employment Agreement dated September 19, 2017, a Fifth Amendment Employment Agreement dated October 2, 2018, a Sixth Amendment Employment Agreement dated August 6, 2019, a Seventh Amendment Employment Agreement dated September 15, 2020, and an Eighth Amendment Employment Agreement dated December 7, 2021, whereby Pulone was employed as City Manager for the City of Yorba Linda pursuant to the terms and conditions set forth in Original Agreement as subsequently amended.

B. Manager desires to continue serving as City Manager of the City of Yorba Linda, and the City desires to continue Pulone as City Manager of the City of Yorba Linda on the terms and conditions set forth in the Original Agreement, subject to the amendments and modifications hereinafter stated.
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AGREEMENT
NOW, THEREFORE, the parties agree to the following amendment to the terms and conditions of Manager' s employment:

1. Section 4( a) Salary is amended to state:

Effective July 1, 2022, City Council grants Manager an increase in his current base salary of $264, 745. 42 based on merit and performance in accordance with the provisions of Section 4( a) of Original Agreement. The merit and performance increase is 2. 0%.

Therefore, effective July 1, 2022, City agrees to pay Manager an annual base salary, exclusive of benefits, in the sum of$270, 040. 32, payable in installments at the same time and by the same methods as other City employees are regularly paid. In addition thereto, at least thirty ( 30) days prior to Manager' s Anniversary Date ( August 5th), the Council shall conduct a performance evaluation of Manager, and if a majority of the Council deems Manager to have successfully performed up to the Anniversary Date may, in their sole discretion, grant Manager an increase in base salary based on merit and performance consistent with the City' s compensation policy in effect at the time of said increase. City and Manager agree to review Manager' s salary and benefits at the time ofManager' s performance evaluation in 2023 and subsequent years thereafter.

Council may, in its discretion, reduce the salary of Manager due to budgetary constraints, on condition that any such reduction shall not exceed the average reduction applicable to all management 539/ 009410- 1019
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employees ofthe City at the time ofreduction and Manager' s salary.

Furthermore, Manager, in his sole discretion may elect not to receive any salary increase that may be granted hereunder; provided, however, if Manager elects not to receive a salary increase provided hereunder, said salary increase shall be subsequently implemented, on a prospective basis only, upon written request ofManager."

2. Section 11 ENTIRE AGREEMENT is amended to state:

Except as herein stated, all other terms and conditions of the Original Employment Agreement dated July 2, 2013, as amended in the First Amendment Employment Agreement dated October 7, 2014, as amended in the Second Amendment Employment
Agreement dated October 6, 2015, as amended in the Third Amendment Employment Agreement dated November 15, 2016, as amended in the Fourth Amendment Employment Agreement dated September 19, 2017, as amended in the Fifth Amendment
Employment Agreement dated October 2, 2018, as amended in the Sixth Amendment Employment Agreement dated August 6, 2019, as amended in the Seventh Amendment Employment Agreement dated September 15, 2020, and as amended in the Eighth
Amendment Employment Agreement dated December 7, 2021,
shall remain in full force and effect until changed or terminated pursuant to the provisions of Section 3 of Original Employment Agreement.
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This First, Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, and Ninth Amendment Employment Agreement and
Original Employment Agreement contain the Entire Agreement between the parties concerning the subject matters set forth therein, and no promise, representation, warranty or covenant not included in this Ninth Amendment Employment Agreement, Eighth
Amendment Employment Agreement, Seventh Amendment
Employment Agreement, Sixth Amendment Employment
Agreement, Fifth Amendment Employment Agreement, Fourth Amendment Employment Agreement, Third Amendment
Employment Agreement, Second Amendment Employment
Agreement, First Amended Employment Agreement or Original Employment Agreement have been or is relied upon by any party hereto concerning the offer and acceptance of employment described therein."

3. Section 13 EFFECTIVE DATE AND TERM is amended to state:

The Effective Date of this Eighth Amendment Employment
Agreement is July 1, 2022, and the term is for three ( 3) years until September 30, 2025.

IN WITNESS WHEREOF, the parties hereto have executed this Ninth Amendment Employment Agreement as of the date first set forth hereinabove.

Date: October 4, 2022
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Ninth Amendment Employment Agreement approved by City Council in open session at a regular City Council meeting and reflected in the minutes pursuant to Government Code sections 53262 and 54956( b).

CITY: MANAGER: rs\
Carlos Rodriguez, / 7r Mark Pulone
ATTEST:

CAc
Marcia Brown, City Clerk
APPROVED AS TO FORM:

Todd Litfin, City Attorney
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ELEVENTH AMENDMENT

EMPLOYMENT AGREEMENT
This Eleventh Amendment Employment Agreement between the City of Yorba Linda (“City”) and Mark Pulone (“Pulone” or “Manager”) (“Eleventh Amendment Employment Agreement”) is made this 6th day of August, 2024.

RECITALS
A. City and Manager entered into an Employment Agreement dated July 2, 2013 (“Original Agreement”), a First Amendment Employment Agreement dated October 7, 2014, a Second Amendment Employment Agreement dated October 6, 2015, a Third Amendment Employment Agreement dated November 15, 2016, a Fourth Amendment Employment Agreement dated September 19, 2017, a Fifth Amendment Employment Agreement dated October 2, 2018, a Sixth Amendment Employment Agreement dated August 6, 2019, a Seventh Amendment Employment Agreement dated September 15, 2020, an Eighth Amendment Employment Agreement dated December 7, 2021, a Ninth Amendment Employment Agreement dated October 4, 2022, and a Tenth Amendment Employment Agreement dated August 15, 2023, whereby Pulone was employed as City Manager for the City of Yorba Linda pursuant to the terms and conditions set forth in Original Agreement as subsequently amended.

B. Manager desires to continue serving as City Manager of the City of Yorba Linda, and the City desires to continue Pulone as City Manager of the City of Yorba Linda on the terms and conditions set forth in the Original Agreement, subject to the amendments and modifications hereinafter stated.

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AGREEMENT
NOW, THEREFORE, the parties agree to the following amendment to the terms and conditions of Manager’s employment:

1. Section 4(a) Salary is amended to state:
“Effective July 1, 2024, City Council grants Manager an increase in his current base salary of $289,213.17 based on merit and performance in accordance with the provisions of Section 4(a) of Original Agreement. Based on a successful performance review, the City Council grants Manager a salary increase of 6.0%. Therefore, effective July 1, 2024, City agrees to pay Manager an annual base salary, exclusive of benefits, in the sum of $306,565.96, payable in installments at the same time and by the same methods as other City employees are regularly paid. In addition thereto, the Council shall conduct a performance evaluation of Manager in or near August of 2025, and if a majority of the Council deems Manager to have successfully performed up to the Anniversary Date the City Council may, in its sole discretion, grant Manager an increase in base salary based on merit and performance consistent with the City’s compensation policy in effect at the time of said increase. City and Manager agree to review Manager’s salary and benefits at the time of Manager’s performance evaluation in 2025 and subsequent years thereafter.

Council may, in its discretion, reduce the salary of Manager due to budgetary constraints, on condition that any such reduction

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shall not exceed the average reduction applicable to all management employees of the City at the time of reduction and Manager’s salary.

Furthermore, Manager, in his sole discretion may elect not to receive any salary increase that may be granted hereunder; provided, however, if Manager elects not to receive a salary increase provided hereunder, said salary increase shall be subsequently implemented, on a prospective basis only, upon written request of Manager.”

2. Section 11 ENTIRE AGREEMENT is amended to state:
“Except as herein stated, all other terms and conditions of the Original Employment Agreement dated July 2, 2013, as amended in the First Amendment Employment Agreement dated October 7, 2014, as amended in the Second Amendment Employment
Agreement dated October 6, 2015, as amended in the Third Amendment Employment Agreement dated November 15, 2016, as amended in the Fourth Amendment Employment Agreement dated September 19, 2017, as amended in the Fifth Amendment
Employment Agreement dated October 2, 2018, as amended in the Sixth Amendment Employment Agreement dated August 6, 2019, as amended in the Seventh Amendment Employment Agreement dated September 15, 2020, as amended in the Eighth Amendment Employment Agreement dated December 7, 2021, as amended in the Ninth Amendment Employment Agreement dated October 4, 2022, and as amended in the Tenth Amendment Employment

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Agreement dated August 15, 2023, shall remain in full force and effect until changed or terminated pursuant to the provisions of Section 3 of Original Employment Agreement.

This First, Second, Third, Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, Tenth, and Eleventh Amendment Employment Agreement and Original Employment Agreement contain the Entire Agreement between the parties concerning the subject matters set forth therein, and no promise, representation, warranty or covenant not included in this Eleventh Amendment Employment Agreement, Tenth Amendment Employment Agreement, Ninth Amendment
Employment Agreement, Eighth Amendment Employment
Agreement, Seventh Amendment Employment Agreement, Sixth Amendment Employment Agreement, Fifth Amendment
Employment Agreement, Fourth Amendment Employment
Agreement, Third Amendment Employment Agreement, Second Amendment Employment Agreement, First Amended Employment Agreement or Original Employment Agreement have been or is relied upon by any party hereto concerning the offer and acceptance of employment described therein.”

3. Section 13 EFFECTIVE DATE AND TERM is amended to state:

The Effective Date of this Eleventh Amendment Employment Agreement is July 1, 2024, and the term remains until September 30, 2026.

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IN WITNESS WHEREOF, the parties hereto have executed this Eleventh Amendment Employment Agreement as of the date first set forth hereinabove.

Date: August 6, 2024
Eleventh Amendment Employment Agreement approved by City Council in open session at a regular City Council meeting and reflected in the minutes pursuant to Government Code sections 53262 and 54956(b).

CITY:

Tara Campbell, Mayor
MANAGER:

Mark Pulone
ATTEST:

Marcia Brown, City Clerk
APPROVED AS TO FORM:

Todd Litfin, City Attorney

CITY COUNCIL MEETING

AGENDA SCHEDULING REQUEST FORM
TO: CITY MANAGER
FROM: Mayor Tara Campbell and Councilman Carlos Rodriguez FOR (DATE OF COUNCIL MEETING): August 6, 2024
“OTHER BUSINESS” ITEM TO BE AGENDIZED:

TITLE OF REPORT/ ITEM:

Adopt Resolution Requesting the California Insurance Commissioner, State Legislature and Governor Take Emergency Action to Strengthen and Stabilize California’s Marketplace for Homeowners and Commercial Property Insurance ADDITIONAL INFORMATION:

Homeowners Insurance has become a critical problem in our community. After hearing from numerous residents about excessive rate increases and others being dropped by their insurance providers, Mayor Campbell worked diligently with community members and city staff to facilitate a presentation from the Insurance Commissioner’s office in Yorba Linda in March 2024. The room was packed with concerned residents, but the solutions offered by the Commissioner’s office were disappointingly projected for years into the future. Since then, the situation has only deteriorated, with residents from all corners of Yorba Linda experiencing even more frequent drops and unsustainable rate hikes. This is not an issue unique to our city; recently, the San Bernardino County Board of Supervisors adopted a resolution urging the Insurance Commissioner, State Legislature, and Governor to take immediate action. We are now asking our colleagues on the City Council to join us in sending a similar urgent message to the State.

Immediate intervention is necessary to halt the worsening crisis.

CC: MAYOR & CITY COUNCIL

CITY CLERK

1 RESOLUTION NO. 2024-

A RESOLUTION OF THE CITY OF YORBA LINDA REQUESTING THE CALIFORNIA

INSURANCE COMMISSIONER, STATE LEGISLATURE, AND THE GOVERNOR TAKE EMERGENCY ACTION TO STRENGTHEN AND STABILIZE CALIFORNIA’S MARKETPLACE FOR HOMEOWNERS AND COMMERCIAL PROPERTY INSURANCE.

WHEREAS, in 1988, California voters enacted Proposition 103, which established a robust set of consumer protections designed to keep insurance rates fair and affordable and to ensure a competitive marketplace; and
WHEREAS, last year, two of the State's largest insurance carriers, representing over 27 percent of the admitted insurance market in California, announced they would stop issuing new homeowners and commercial property insurance policies in California; several others, representing more than another 36 percent of the market, announced plans to limit new policy origination; and
WHEREAS, the reduction of insurance options in the State has a direct negative effect on consumer access to coverage: in all parts of the State, homeowners, business owners, and farmers are now unable to obtain new insurance policies from the admitted insurance market; and
WHEREAS, access to insurance allows existing homeowners to protect what is for many their largest and most important asset, and empowers homebuyers to secure a mortgage for a home that can build generational wealth, but a scarcity of options may freeze real estate transactions and slow or stop the rate of new housing development, including attached dwelling units like affordable housing projects, apartments, and condominiums, exacerbating the State's critical housing shortage; and WHEREAS, Californians who cannot obtain coverage from the admitted market are forced to apply for protection through the California Fair Access to Insurance Requirements (FAIR) Plan, a state-established risk pool intended to operate as California's insurer of last resort providing temporary coverage as consumers pursue insurance in the traditional market; and
WHEREAS, the collapsing admitted-provider market has caused steadily increasing enrollment in the FAIR Plan over the past five years, threatening the ongoing stability of the plan, putting even this safety net at dire risk; and
WHEREAS, policy decisions have placed Californians' homes and businesses at risk of catastrophic loss that can only be prevented by stabilizing the homeowners insurance and commercial property insurance markets while providing rates that remain fair and affordable to consumers, and maintaining the ongoing viability of the FAIR Plan, which provides a vital safety net to Californians whose policies are nonrenewed and to homebuyers who cannot secure a mortgage without insurance; and
WHEREAS, the California Insurance Commissioner has released draft regulations to address this immediate crisis but the Little Hoover Commission hearing on March 28, 2024 reports that reforms “will not go into effect until at least 2026, and it may take a few years after

2 that for the market to react… this timeline, of course could be delayed further if lawsuits by any party, including insurers or consumers, were to occur”; and WHEREAS, the California Insurance Commissioner has broad authority under the Insurance Code to adopt emergency regulations to promote the public welfare, including under sections 1861.01, 1861.05, and 1861.055 to adopt emergency regulations governing the prior approval process for insurance rate change applications, and to adopt emergency regulations under section 11346.1 of Government Code and section 12921.7 of the Insurance Code.

NOW, THEREFORE, BE IT RESOLVED BY THE CITY OF YORBA LINDA, as follows:

The Insurance Commissioner, State Legislature, and the Governor are requested to declare a state of emergency and take immediate emergency regulatory and legislative action to strengthen and stabilize California’s marketplace for homeowners insurance and commercial property insurance. The Commissioner, Legislature, and Governor must consider the following goals in crafting an appropriate regulatory response:
a. Expand coverage choices for all consumers, particularly in underserved areas of the State.
b. Improve the efficiency, speed, and transparency of the California Department of Insurance’s rate approval process.
c. Tailor the rate approval process to account for all factors necessary to promote a robust, competitive insurance marketplace, including through potential revisions to the way catastrophe risks, reinsurance costs, and other legitimate insurer costs are accounted for.
a. Maintain the long-term availability of homeowners and commercial property insurance coverage.
b. Maintain the solvency of the FAIR Plan to protect its policyholders and promote longterm resiliency in the face of extreme weather events, including by identifying mechanisms to reduce its share of the overall market in underserved areas and move its customers into the admitted insurance market.