Agenda

City Council and Successor Agency
to the Brea Redevelopment
Agency Agenda

Tuesday, August 17, 2021

6:00 p.m. - Closed Session
7:00 p.m. - General Session

Steven Vargas, Mayor

Cecilia Hupp, Mayor Pro Tem

Christine Marick, Council Member

Glenn Parker, Council Member

Marty Simonoff, Council Member

This agenda contains a brief general description of each item Council will consider. The City Clerk has on file copies of written documentation relating to each item of business on this Agenda available for public inspection. Contact the City Clerk’s Office at (714) 990-7756 or view the Agenda and related materials on the City’s website at www.cityofbrea.net. Materials related to an item on this agenda submitted to the Council after distribution of the agenda packet are available for public inspection in the City Clerk’s Office at 1 Civic Center Circle, Brea, CA during normal business hours. Such documents may also be available on the City’s website subject to staff’s ability to post documents before the meeting.

Procedures for Addressing the Council
This meeting is being conducted consistent with Governor Newsom’s Executive Order N-29-20 dated March 17, 2020, regarding the COVID-19 pandemic.

Written comments may be sent to cityclerksgroup@cityofbrea.net no later than 12:00 p.m. on Tuesday, August 17, 2021 which will be summarized aloud into the record at the meeting. To provide comments in person, the Council Chambers will be open. To provide comments by teleconference (Zoom), members of the public must contact City Staff at (714) 990-7756 or cityclerksgroup@cityofbrea.net no later than 12:00 p.m. on Tuesday, August 17, 2021 to obtain the Zoom Meeting ID number and password. Teleconference participants will be muted until recognized at the appropriate time by the Council. The meeting will also be broadcast live at www.cityofbrea.net.

Special Accommodations
In compliance with the Americans with Disabilities Act, if you need special assistance to participate in this meeting, please contact the City Clerk’s Office at (714) 990-7757. Notification 48 hours prior to the meeting will enable City staff to make reasonable arrangements to ensure accessibility. (28 CFR 35.102.35.104 ADA Title II)

Important Notice
The City of Brea shows both live broadcasts and replays of City Council Meetings on Brea Cable Channel 3 and over the Internet at www.cityofbrea.net. Your attendance at this public meeting may result in the recording and broadcast of your image and/or voice as previously described.

CLOSED SESSION

6:00 p.m. - Executive Conference Room
Level Three

CALL TO ORDER / ROLL CALL - COUNCIL

Public Comment

Closed Session may convene to consider matters of purchase / sale of real property (G. C. §54956.8), pending litigation [G.C.§54956.9(d)(1)], potential litigation [G.C. §54956.9(d)(2)(3) or (4)], liability claims (G. C. §54961) or personnel items (G.C.§54957.6). Records not available for public inspection.

Conference with City's Labor Negotiator Pursuant to Government Code §54957.6 Regarding the Brea Fire Association (BFA); Brea Fire Management Association (BFMA); Brea Police Association (BPA); Brea Police Management Association (BPMA); Part-Time Employees; and Executive Managers - Chris Emeterio, Negotiator, Cindy Russell, Negotiator, and Mario E. Maldonado, Negotiator.

Conference with Legal Counsel Pursuant to Government Code Section 54956.9(d)(1) - Existing Litigation. Name of Case: Lucas Builders, Inc. v. City of Brea (Case No. 30-2020-01147152-CU-BC-NJC)

GENERAL SESSION
7:00 p.m. - Council Chamber
Plaza Level

CALL TO ORDER/ ROLL CALL - COUNCIL

Pledge of Allegiance: Brea Police Explorers

Invocation: Daniel Mendoza, Celebration OC

Presentation: 2021 Investment Advisory Committee (IAC) Annual Update Presentation and City Treasurer Presentation - Long-Term Debt Obligation Overview

Attachments

IAC Presentation

City Treasurer Presentation

Presentation: Police Department Hiring and Training

Attachments

RCJTC Presentation

Brea Hiring Process Presentation

Community Announcements

Matters from the Audience
Written comments may be sent to cityclerksgroup@cityofbrea.net no later than 12:00 p.m. on Tuesday, August 17, 2021 which will be summarized aloud into the record at the meeting. To provide comments in person, the Council Chambers will be open. To provide comments by teleconference (Zoom), members of the public must contact City Staff at (714) 990-7756 or cityclerksgroup@cityofbrea.net no later than 12:00 p.m. on Tuesday, August 17, 2021 to obtain the Zoom Meeting ID number and password. Teleconference participants will be muted until recognized at the appropriate time by the Council. The meeting will also be broadcast live at www.cityofbrea.net.

10.

Response to Public Inquiries - Mayor / City Manager

CONSENT CALENDAR - The City Council/Successor Agency approves all Consent Calendar matters with one motion unless Council/Agency or Staff requests further discussion of a particular item. Items of concern regarding Consent Calendar matters should be presented during “Matters from the Audience."

CITY COUNCIL - CONSENT

11.

July 20, 2021 City Council Regular Meeting Minutes - Approve.

Attachments

Minutes

12.

July 22, 2021 City Council Special Meeting Minutes - Approve.

Attachments

Draft Minutes

13.

Site Maintenance and Restoration Agreement for property located at 2700 E. Imperial Hwy - Approve the Site Maintenance and Restoration Agreement. There is no fiscal impact to the General Fund.

Attachments

EXHIBIT 'A' - PROPERTY LOCATION

EXHIBIT 'B' - SEWER MAIN AND EASEMENT AREA

Site Maintenance and Restoration Agreement

14.

Accept Public Improvements, Authorize City Clerk to Release Improvement Bonds and Accept One-Year Warranty Bond for Tract No. 17160 for La Floresta Development Planning Area 10 Located at the Northeast Corner of Imperial Highway and Valencia Avenue - Accept Public Improvements; authorize the City Clerk to release Improvement Bonds; and accept One-year Warranty Bond. There is no fiscal impact to the General Fund.

Attachments

Exhibit "A" - Site Location

One-Year Warranty Bond

15.

Mutual Aid Agreement for COVID-19 Vaccination Effort with the County of Orange - Approve Mutual Aid Memorandum of Agreement and Resolution No. 2021-051 between County of Orange and City of Brea. This Agreement may allow the City of Brea to receive reimbursement for costs associated with staffing the Vaccination PODs.

Attachments

Resolution for MOA with Orange County

Mutual Aid Agreement for COVID PODs

16.

Software/Hardware Maintenance Support and Online Subscription Service Agreements - Authorize the Purchasing Agent to approve renewal agreements with various support services providers for the life of the computer software or hardware and for online software subscription services; and Authorize the Purchasing Agent to issue purchase orders totaling $149,436.00 for these renewal agreements that do not to exceed available budget appropriations. The City Council adopted Fiscal Year 2021-22 Budget has sufficient funding available for these purchases.

17.

Purchase of new Taser 7 CEW Devices for Police Department - Approve the purchase of sixty-five Taser 7 CEW devices and related accessories from Axon Enterprises, Inc. for $173,142.83. The FY 21-22 adopted Operating Budget allocated $174,523 for this purchase in account 172-21-2141-4639.

Attachments

Decision Package

Axon Taser Limited Distribution Letter

Quote from Axon

Quote from ProForce

18.

Purchase of New Zebra Brand Ticket-Writer Printers for Police Department - Approve the purchase of thirty-two new Zebra brand model ZQ521 ticket-writer printers (and related accessories) from MSA Systems, Inc. for $28,360.28. The FY 21-22 adopted Operating Budget allocated $32,100 for this purchase in account 172-21-2141-4639.

Attachments

Decision Package

Quote from MSA Systems

19.

Fire Investigation Services Agreement - City of Anaheim - Approve The Fire Investigation Services Contract between the City of Anaheim and City of Brea. The projected impact to the General Fund would be $3,500.

Attachments

Fire Investigator Services Agmt

20.

Award the Country Hills Pavement & Water Improvements, CIP Project No. 7322 - Approve the Plans and Specifications; Receive bids; Award Contract to the lowest responsive and responsible bidder, Williams Pipeline Contractors, Inc., in the amount of $4,791,264.52; and Authorize the City Engineer to issue Change Orders up to a "not to exceed" amount of 10% of the Contract Price. The Project budget is programmed in the FY 2021- 22 Capital Improvement Program. There is no fiscal impact to the General Fund.

Attachments

Vicinity Map

Proposal

21.

Purchase of Two (2) Generac Industrial Diesel Generators - Authorize purchase of two (2) Generac industrial diesel engine-driven generators for Booster Pump Stations Nos. 2 and 3 for not-to-exceed amount of $103,045.31. Sufficient funds for the purchase of the generators are available in the Capital Improvement Program budgets for Booster Pump Stations Nos. 2 and 3. There is no fiscal impact to the General Fund.

Attachments

Quote-BP2

Quote-BP3

22.

Acceptance of the Imperial Highway/Berry Street Intersection Improvements, CIP Project No. 7278 - Accept project as complete and authorize City Clerk to record Notice of Completion; and Authorize the City Clerk to release the Payment and Performance Bonds. The source of funds for the project is the Traffic Impact Fund (Fund 540). There is no fiscal impact to the General Fund.

Attachments

Location Map

NOC

23.

Acceptance of the Country Lane Street Rehabilitation, CIP Project No. 7323 - Accept project as complete and authorize City Clerk to record Notice of Completion; and Authorize City Clerk to release the Payment and Performance Bonds. The project was funded through the Measure M Fund (Fund 260) and the Gas Tax Fund (220). There is no fiscal impact to the General Fund.

Attachments

Location Map

NOC

24.

Resolution in Support of a Veterans Cemetery in Anaheim - Adopt Resolution No. 2021-052 in support of the establishment of a veterans cemetery in the City of Anaheim.

Attachments

Resolution

25.

Ratify Termination and Award Multiple Contracts for Landscape Maintenance Services at Various Locations in the City of Brea - Ratify Termination of S.C. Yamamoto, Award Landscape Maintenance Agreements to Nieves Landscape Inc. for Mowing at City Parks, Landscape Maintenance at City Medians, and various Maintenance Districts totaling $364,103.00; and Authorize City Manager to approve contract extensions.

Attachments

Agreement for Parks Mowing

Agreement - City Medians

Agreement - MD1

Agreement - MD3

Agreement - MD6

Agreement MD7

Notice to Cure

Notice of Termination

Fee Schedule Parks Mowing

Fee Schedule City Medians Greenbelts Entry Markers

Fee Schedule MD1

Fee Schedule MD3

Fee Schedule MD6

Fee Schedule MD 7

Approved COI Nieves

26.

Budget Adjustment to Remodel Areas of Police Administration - Appropriate $40,000 from the City’s Fixed Asset Replacement Fund (Fund 182) to the Civic Center Remodel Project (CIP 7955) to remodel the Police Department's Professional Standards office and the Police Administration kitchen area. The project is recommended to be funded by the Fixed Asset Replacement Program Fund (182). There is no fiscal impact to the General Fund.

27.

Investment Policy Guidelines for the City of Brea's Employee Benefits Fund Pension Plan - Review and approve the Investment Policy Guidelines for the City of Brea’s Employee Benefits Fund Pension Plan through Public Agency Retirement Services (PARS). There is no fiscal impact to the General Fund.

Attachments

Pension Trust Fund Investment Policy Guidelines - Redline Version

Pension Trust Fund Investment Policy Guidelines - Clean Version

28.

Investment Policy Guidelines for the City of Brea's Other Post Employment Benefits (OPEB) Trust Fund - Review and approve the Investment Guidelines for the City's Other Post Employment Benefits (OPEB) Trust Fund through Public Agency Retirement Services (PARS). There is no fiscal impact to the General Fund.

Attachments

OPEB Trust Investment Policy Guidelines - Redline Version

OPEB Trust Investment Policy Guidelines - Clean Version

29.

Annual Review of Statement of Investment Policy for the City of Brea/Successor Agency to the Brea Redevelopment Agency - Review and approve the City of Brea/Successor Agency to the Brea Redevelopment Agency Statement of Investment Policy. There is no fiscal impact to the General Fund.

Attachments

Current Investment Policy - Adopted 8/18/20

Proposed Final Investment Policy - Redlined Version

Proposed Final Investment Policy - Clean Version

30.

Monthly Report of Cash Investments for the City of Brea for Period Ending June 30, 2021 - Receive and file.

Attachments

Attachment A

31.

Outgoing Payment Log and July 23 & 30 and August 6 & 13, 2021 City Disbursement Registers - Receive and file.

Attachments

City Outgoing Payment Log

07-23-2021 Disbursement Register

07-30-2021 Disbursement Register

08-06-2021 Disbursement Register

08-13-2021 Disbursement Register

CITY/ SUCCESSOR AGENCY - CONSENT

32.

Monthly Report of Cash Investments for the Successor Agency to the Brea Redevelopment Agency for Period Ending June 30, 2021 - Receive and file.

Attachments

Attachment A

33.

Attachments

Current Investment Policy - Adopted 8/18/20

Proposed Final Investment Policy - Redlined Version

Proposed Final Investment Policy - Clean Version

34.

Successor Agency Disbursement Registers July 26, 2021 and July 30, 2021 - Receive and file.

Attachments

07-30-2021 Successor Agency Disbursement Register

ADMINISTRATIVE ANNOUNCEMENTS

35.

City Manager

36.

City Attorney

37.

Council Requests

COUNCIL ANNOUNCEMENTS

ADJOURNMENT


City Council Meeting		Agenda Item 14.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:
Accept Public Improvements, Authorize City Clerk to Release Improvement Bonds and Accept One-Year Warranty Bond for Tract No. 17160 for La Floresta Development Planning Area 10 Located at the Northeast Corner of Imperial Highway and Valencia Avenue.
RECOMMENDATION
Accept Public Improvements, Authorize City Clerk to Release Improvement Bonds, and Accept One-year Warranty Bond.
BACKGROUND/DISCUSSION
On June 21, 2016, City Council approved Final Tract Map 17160 ("Map") for single-family lots, Subdivision Improvement Agreement ("SIA") and Improvement Bonds for La Floresta Development Planning Area 10 ("PA10"), located at the northeast corner of Imperial Highway and Valencia Avenue. This map subdivided an approximately 18.9-acre site into ninety-six (96) single family lots, five (5) lettered lots for private streets, one (1) lettered lot for a private alley, and seventeen (17) lettered lots for landscape purposes. See attached Exhibit "A" for the site location. The applicant, Pulte Home Corporation ("Developer") entered into the SIA and submitted Improvement Bonds (Performance and Labor Materials Bonds) in the amount of Two Million Forty-five Thousand Dollars ($2,045,000.00) for construction of the required public and private improvements. The required public improvements consisted of public water mains, public sewer mains and public storm drain mains. The required private improvements, included curb, gutter, sidewalk, driveways, street lights, and water quality treatment features. Since approval of the Map, the Developer has completed construction of the required improvements. All construction was completed in accordance with the approved improvement plans and to the City Engineer's satisfaction. In addition, City staff has reviewed the Conditions of Approval for this development and has determined that the associated public improvements conditions have been met. City staff is recommending that City Council accept the public improvements and release the Performance Bond. The Labor Material Bond will remain in full effect for six months and be released by the City Clerk. A One-year Warranty Bond, in the amount of Two Hundred Four Thousand Five Hundred Dollars ($204,500.00), is provided in accordance with the SIA to guarantee the work and materials for one year following the date of acceptance. The One-year Warranty Bond will be released after the one-year warranty period if there is no warranty work remaining. Therefore, City staff is recommending that City Council accept the One-year Warranty Bond.
FISCAL IMPACT/SUMMARY
There will be no fiscal impact to the General Fund. The improvements were constructed at no cost to the City and fees for the development are current and paid. The City will be responsible for maintenance of the public improvements upon acceptance, which is covered within the Public Works annual operational budget. The required public improvements have been completed pursuant to the SIA and a warranty bond for one year has been provided. Therefore, staff recommends the City Council accept the public improvements, release the Improvement Bonds, and accept the One-Year Warranty Bond.
RESPECTFULLY SUBMITTED:
William Gallardo, City Manager Prepared by: Hsing Chao, Associate Engineer Concurrence: Michael Ho, P.E. Deputy Public Works Director / City Engineer Tony Olmos P.E., Public Works Director

Attachments
Exhibit "A" - Site Location
One-Year Warranty Bond


City Council Meeting		Agenda Item 15.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:
Mutual Aid Agreement for COVID-19 Vaccination Effort with the County of Orange
RECOMMENDATION
Approve Mutual Aid Memorandum of Agreement (AGREEMENT) and Resolution No. 2021-051 between County of Orange and City of Brea.
BACKGROUND/DISCUSSION
COVID-19 is a world-wide pandemic resulting in significant health and economic impacts across the globe. On February 25, 2020, the United States Centers for Disease Control and Prevention (CDC) announced that community spread of the novel coronavirus (COVID-19) was likely. On February 26, 2020, the Orange County Health Officer declared a Health Emergency. On February 26, 2020, the Chair of the Emergency Management Council issued a Proclamation of Local Emergency pursuant to the requirements of the California Emergency Services Act, which was ratified by the Board of Supervisors on March 2, 2020. On March 4, 2020, the Governor of the State of California proclaimed a state of emergency in response to the COVID-19 pandemic pursuant to the California Emergency Services Act. On March 13, 2020, the President of the United States issued a Major Disaster Declaration for California (FEMA-4482-DR-CA) in response to the COVID-19 pandemic pursuant to section 501 (b) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5121-5207 (the “Stafford Act”). This action made the State of California, local and Indian tribal governments, and certain private non-profit (PNP) organizations eligible to apply for reimbursement from Federal Emergency Management Agency (FEMA) Public Assistance (PA) Program. On December 31, 2020, the County of Orange (County) launched Operation Independence with the goal of facilitating the vaccination of all willing community members by July 4, 2021. To accomplish this, an Incident Management Team was assigned to lead the organization of mass vaccination sites, known as Points of Dispensing (PODs). Because the PODs provide mutual benefit to all community members across the County, regardless of the City they live or work in, staffing support of the PODs is requested of local jurisdictions. Staffing goals for each jurisdiction are set based upon the proportion of community members living in their jurisdiction. To reimburse cities, mutual aid agreements are required between the County and each requesting jurisdiction. The County Board of Supervisors approved the standard Mutual Aid Memorandum of Agreement (MOA) on March 9, 2021. A revised MOA was approved by the Board of Supervisors on July 27, 2021 (Attachment A). The City of Brea City Council is requested to approve the Agreement, without changes, and authorize by Resolution (Attachment B), the City Manager or designee to execute any actions necessary for the purposes of obtaining federal financial assistance related to this Agreement, if those actions do not materially change the terms or amount of the City of Brea’s commitment as it is reflected in the above-referenced AGREEMENT.
FISCAL IMPACT/SUMMARY
This Agreement may allow the City of Brea to receive reimbursement for costs associated with staffing the Vaccination PODs.
RESPECTFULLY SUBMITTED:
William Gallardo, City Manager Prepared by: Lisa Keyworth, Emergency Preparedness Analyst Concurrence: Adam Loeser, Fire Chief

Attachments
Resolution for MOA with Orange County
Mutual Aid Agreement for COVID PODs


City Council Meeting		Agenda Item 19.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:
Fire Investigation Services Agreement - City of Anaheim
RECOMMENDATION
Approve The Fire Investigation Services Contract between the City of Anaheim and City of Brea.
BACKGROUND/DISCUSSION
The California Fire Code requires the Brea Fire Department to investigate fires within its jurisdiction as the Authority Having Jurisdiction (AHJ). When a fire agency cannot conduct the investigation, the AHJ may seek out other public agencies to assist in determining the cause and origin and pursue any criminal related follow-up as necessary. Fire investigation ultimately provides for increased community risk reduction, improved firefighting tactics, heightened public awareness, more focused prevention efforts, and reduced fire-related criminal activity. The Brea Fire Department (BFD) historically has not had an internal fire/arson Investigation program. Recently, the BFD attempted to initiate an internal fire/arson investigation program, however was unable to do so due to a labor dispute. As is routine for the Orange County Operational Area, the BFD utilizes the specialties of its Orange County partner agencies to accomplish these needs. Although BFD has utilized the fire/arson investigation services of Anaheim Fire & Rescue for many years, Anaheim Fire & Rescue and the BFD seek to formalize the services and associated costs through a contract at the present time. As one of Brea’s nearby cities, Anaheim typically receives the first call for these services. Based on historical analysis, the BFD does not anticipate exceeding an annual expenditure of $3,500. During fire/arson investigations, the Brea Fire Chief and Fire Marshal remain the primary lead over the incident and work with the Anaheim investigators throughout the investigation. Coordination with the Brea Police Department for any criminal activity may be required as necessary. The BFD may reconsider its own internal fire/arson investigation program in the not too distant future. In the event the BFD establishes its own fire/arson investigation program, the City will likely only require Anaheim Fire & Rescue’s investigation services on a very limited basis when exigent or unusual circumstances exist. A potential future BFD fire/arson investigation program would be self-sufficient and include criminal follow-up, limiting the impact on Brea PD. Formation of such program will be brought before City Council at a later date.
COMMISSION/COMMITTEE RECOMMENDATION
The Finance Committee reviewed staff’s recommendation at their August 10, 2021 meeting and recommended for Council approval.
FISCAL IMPACT/SUMMARY
The projected impact to the General Fund would be $3,500.
RESPECTFULLY SUBMITTED:
William Gallardo, City Manager Prepared by: Adam Loeser, Fire Chief

Attachments
Fire Investigator Services Agmt


City Council Meeting		Agenda Item 20.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:

Award the Country Hills Pavement & Water Improvements, CIP Project No. 7322

RECOMMENDATION

Approve the Plans and Specifications;
Receive bids;
Award Contract to the lowest responsive and responsible bidder, Williams Pipeline Contractors, Inc., in the amount of $4,791,264.52; and
Authorize the City Engineer to issue Change Orders up to a "not to exceed" amount of 10% of the Contract Price.

BACKGROUND/DISCUSSION

The Country Hills Pavement & Water Improvement Project, Project No. 7322 ("Project") is programmed in the Fiscal Year ("FY") 2021-22 Capital Improvement Program (CIP). The Project is located within the residential neighborhood north of Birch Street, south of Lambert Road, east of North Associated Road, and west of Kraemer Boulevard. (Attachment A).

The work consists of pavement rehabilitation including cold milling; placement of new asphalt concrete; sidewalk improvements; curb and gutter improvements; curb ramp improvements; adjustment of manholes; replacing over 12,000 linear feet of water lines; and replacing water meters in the Country Hills neighborhood.

Final Plans and Specifications ("Bid Documents") were advertised for bids on CIPlist.com and subsequently published in the adjudicated newspaper in accordance with the California Uniform Public Construction Cost Accounting (CUPCCA). A copy of the Bid Documents is available in the City Clerk's office for review. There were three addendums to the Bid Documents, which provided clarification regarding the bid opening date and other miscellaneous modifications. Therefore, staff recommends City Council approve the final Bid Documents with the three addendums as bid.

On August 6, 2021, staff received a total of 11 bid proposals. Staff then tabulated the bid proposals and determined that the apparent low bid amount was $4,791,264.52 of Williams Pipeline Contractors, Inc. from Mission Hills, California (Attachment B).

Below are the results of the 11 bids received within Table 1:

Table 1 - Total Bid Summary
Bid Number	Bidder	Amount Bid
1.	Williams Pipeline Contractors, Inc.	$4,791,264.52
2.	CEM Construction	$4,961,475.50
3.	Stephen Doreck	$5,482,869.50
4.	T.E. Roberts	$5,509,991.00
5.	HYM Engineering	$5,819,590.06
6.	Christensen Brothers	$6,000,040.18
7.	Big Ben	$6,094,706.60
8.	Dominguez General	$6,151,923.50
9.	Sully Miller	$6,673,330.00
10.	Kana Pipeline	$6,888,000.00
11.	Gentry Brothers, Inc.	$7,100,304.84
	Engineer's Estimate	$5,100,000.00

As depicted within Table 1, the three lowest bids were very competitive with the apparent lowest bid price from Williams Pipeline Contractors, Inc. coming in lower than the Engineer's Estimate by approximately $308,736, about 6% under.

Williams Pipeline Contractors, Inc. has been in the construction business for over 49 years and has completed construction of similar improvement projects for the City of Downey, City of Whittier, and City of Pasadena. The company has a valid contractor' s license and has received a satisfactory rating according to the references. If awarded, construction could begin in September 2021 and take approximately nine (9) months to complete, weather permitting.

COMMISSION/COMMITTEE RECOMMENDATION

Staff provided an oral update to the Finance Committee at their August 10, 2021 meeting on the bid results received on August 6, 2021, with Williams Pipeline Contractor, Inc. as the apparent low bidder in the amount of $4,791,264.52 .

FISCAL IMPACT/SUMMARY

The Project budget is programmed in the FY 2021- 22 CIP with an amount of $5,817,986. The total updated cost for the Project going into construction is estimated at $5,811,227 based on the final design and staff costs ($185,084), apparent low bid amount of $4,791,264.52, a 10% contingency ($479,126.45), and construction engineering costs ($355,751.39). Once the Project is complete, the remaining project funds will be de-obligated back into the associated funds. The sources of funds within the approved budget are from the Measure M Fund (260), RMRA Fund (221), Water Fund (420), and Gas Tax Fund (220). There is no impact to the General Fund from this project.

The work consists of pavement rehabilitation including cold milling; placement of new asphalt concrete; sidewalk improvements; curb and gutter improvements; curb ramp improvements; adjustment of manholes; replacing over 12,000 linear feet of water lines; and replacing water meters in the Country Hills neighborhood. If City Council approves staff's recommendations, the Project is anticipated to start construction in September 2021 and be completed by May 2022, weather permitting.

RESPECTFULLY SUBMITTED:

William Gallardo, City Manager
Prepared by: Raymond Contreras, Associate Engineer
Concurrence: Michael Ho., P. E., Deputy Director of Public Works / City Engineer
Tony Olmos, P. E., Public Works Director

Attachments
Vicinity Map
Proposal


City Council Meeting		Agenda Item 21.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:
Purchase of Two (2) Generac Industrial Diesel Generators
RECOMMENDATION
Authorize purchase of two (2) Generac industrial diesel engine-driven generators for Booster Pump Stations Nos. 2 and 3 for not-to-exceed amount of $103,045.31.
BACKGROUND/DISCUSSION
Booster Pump Stations Nos. 2 and 3 are located along Carbon Canyon Road/State Route 142 in the easterly side of Brea. These facilities are connected to a City water transmission main and pump water to nearby City reservoirs or water mains in order to store the water at the reservoirs or deliver potable water to residents along Carbon Canyon Road and Olinda Village. Over the years, concerns were raised regarding the ability to operate these pump stations when electric power was unavailable. In those situations, staff would rent portable generators in order to provide continuous power during an emergency or power shutoff. Portable generators are a good temporary solution, but are not practical if physical access to the site is unavailable such as during an active wildfire. In order to permanently address the concern, two projects were added to previous Capital Improvement Programs, New Booster 2 Pump Station (CIP #7475) and Booster 3 Reconstruction (CIP #7470). The New Booster 2 facility will now be located at Olinda Ranch Park, while Booster 3 will remain at its current location approximately one-mile northeast of Olinda Village. Both of these projects will include pump station buildings that will house all pump station equipment and permanent diesel generators. Design for both of these booster station projects is nearing completion. However, securing final easements from existing nearby property owners and utility companies has resulted in some delays, but are nearing completion as well. Final easements are expected to be brought to City Council for approval within the next couple of months. Staff expects to advertise for bids in the late Fall of this year with construction expected to start in winter when water demand and fire risk is at its lowest. Since the generators have an estimated 15-week lead time for delivery, staff is recommending purchasing them ahead of bidding to avoid any additional delays and to prevent general contractors from marking-up the equipment if they had to purchase them as part of the projects. Staff utilized the General Services Administration (GSA) contract with Generac and obtained the lowest possible price of $103,045.31.
COMMISSION/COMMITTEE RECOMMENDATION
The Finance Committee reviewed staff’s recommendation at their August 10, 2021 meeting and recommended for Council approval.
FISCAL IMPACT/SUMMARY
Sufficient funds for the purchase of the generators are available in the Capital Improvement Program budgets for Booster Pump Stations Nos. 2 and 3. There is no impact to the General Fund.
RESPECTFULLY SUBMITTED:
William Gallardo, City Manager Prepared by: Brian M. Ingallinera, Environmental Services Coordinator Concurrence: Rudy Correa, Water Distribution Superintendent Tony Olmos, P.E., Public Works Director

Attachments
Quote-BP2
Quote-BP3


City Council Meeting		Agenda Item 22.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:

Acceptance of the Imperial Highway/Berry Street Intersection Improvements, CIP Project No. 7278.

RECOMMENDATION

Accept project as complete and authorize City Clerk to record Notice of Completion; and
Authorize City Clerk to release the Payment and Performance Bonds.

BACKGROUND/DISCUSSION

On December 15, 2020, the City Council awarded a Contract to Hardy & Harper, Inc. (“Hardy & Harper) in the amount of $565,000 for the Imperial Highway/Berry Street Intersection Improvements, CIP Project No. 7278 ("Project") and approved a $56,500 construction contingency for a total approved construction budget of $621,500. The Project widened the north side of Imperial Highway east of Berry Street to provide a dedicated westbound right turn lane. The improvements included modifying the traffic signal and reconstruction of sidewalks, curb and gutter, and curb access ramps. In addition, the project also included modifications to existing storm drain facilities at the intersection.

The Notice-to-Proceed with construction was issued on February 16, 2021 with a completion date of May 11, 2021 per the allotted number of working days in the contract. However, due to unforeseen conditions related to the utilities and Caltrans requests, the project was substantially completed on May 21, 2021. The amount of change orders approved for the project is $19,648.80, which equates to approximately 3% of the original contract amount. The change orders were primarily the result of the following changes:

Storm Drain installation changed to night work
Added a water gate valve for the fire hydrant for maintenance purposes
Emergency work to abandon a 2” water service line upon discovery

The final total Contract cost is $584,648.80. The improvements have been completed and staff is recommending the City Council approve the Acceptance of Work performed by Hardy & Harper.

The following is a summary of contract costs:

Imperial Highway and Berry Street Intersection Improvement Construction Budget Summary

Original Construction Contract Amount	$565,000.00
Approved Change Orders	$19,648.80
Hardy & Harper Final Construction Contract Budget	$584,648.80
Approved Construction Contract Budget	$621,500.00
Remaining Construction Contract Balance	$36,851.20

COMMISSION/COMMITTEE RECOMMENDATION

The Finance Comittee reviewed staff's recommendation at their August 10, 2021 meeting and reccomended to proceed.

FISCAL IMPACT/SUMMARY

The final Contract amount is $584,648.80, which is under the approved construction budget. The source of funds is from the Traffic Impact Fund (Fund 540). There is no General Fund (Fund 110) impact.

This Project widened the north side of Imperial Highway east of Berry Street to accommodate a dedicated westbound right turn lane which enhances the westbound through traffic on Imperial Highway. Hardy & Harper has completed the Project and fulfilled its obligations to the City per the subject Contract. Therefore, staff is recommending the City Council accept the Project as complete and authorize the City Clerk to record a Notice of Completion. Additionally, staff is recommending authorizing the City Clerk to release the Payment and Performance Bonds.

RESPECTFULLY SUBMITTED:

William Gallardo, City Manager
Prepared by: Raymond Contreras, Associate Engineer
Concurrence: Michael Ho, P. E., Deputy Director of Public Works / City Engineer
Tony Olmos, P. E., Public Works Director

Attachments
Location Map
NOC


City Council Meeting		Agenda Item 23.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:

Acceptance of the Country Lane Street Rehabilitation, CIP Project No. 7323

RECOMMENDATION

Accept project as complete and authorize City Clerk to record Notice of Completion; and
Authorize City Clerk to release the Payment and Performance Bonds.

BACKGROUND/DISCUSSION

On December 15, 2020, the City Council awarded a Contract to Gentry Brothers, Inc. (“Gentry Brothers”) in the amount of $279,738.24 for the Country Lane Street Rehabilitation, CIP Project No. 7323 ("Project") and approved a $27,973.82 construction contingency for a total approved construction budget of $307,712.06.

The Project was located within a residential neighborhood north of Lambert Road, southwest of State College Boulevard, east of Brea Boulevard and west of Cliffwood Avenue. The work consisted of pavement rehabilitation including cold milling, placement of new asphalt concrete, sidewalk improvements, curb and gutter improvements, curb ramp improvements, and adjustment of manholes and valves in the Country Lane neighborhood.

The Notice-to-Proceed with construction was dated January 19, 2021, and the completion date per the allotted number of working days in the contract, was April 14, 2021. Fortunately, despite a few change orders, the project was substantially completed ahead of schedule on March 19, 2021.

The total cumulative amount for the change orders approved on the project was $13,739,45, which equates to approximately 5% of the original contract amount. The change orders primarily consisted of the following items:

Constructed additional driveway to the park parking lot; and
Emergency water repairs

The final total Contract cost with change orders is $293,477.69. The improvements have been completed and staff is recommending the City Council approve the Acceptance of Work performed by Gentry Brothers.

The following is a summary of contract costs:

Country Lane Street Rehabilitation Construction Budget Summary

Original Construction Contract Amount	$279,738.24
Approved Change Orders	$13,739.45
Gentry Brothers Final Construction Contract Amount	$293,477.69
Approved Construction Contract Budget	$307,712.06
Remaining Construction Contract Balance	$14,234.37

COMMISSION/COMMITTEE RECOMMENDATION

The Finance Comittee reviewed staff's recommendation at their August 10, 2021 meeting and reccomended to proceed.

FISCAL IMPACT/SUMMARY

The final Contract amount of $293,477.69 is under the approved construction budget. The source of funds is from Measure M Fund (Fund 260) and Gas Tax Fund (220). There is no General Fund (Fund 110) impact.

This Project rehabilitated the streets in the Country Lane residential neighborhood including placement of new asphalt concrete, sidewalk improvements, curb and gutter improvements, curb ramp improvements, and the adjustment of manholes and valves. Gentry Brothers has completed the Project and fulfilled its obligations to the City per the subject Contract. Therefore, staff is recommending the City Council accept the Project as complete and authorize the City Clerk to record a Notice of Completion. Additionally, staff is recommending authorizing the City Clerk to release the Payment and Performance Bonds.

RESPECTFULLY SUBMITTED:

Attachments
Location Map
NOC


City Council Meeting		Agenda Item 25.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:

Ratify Termination and Award Multiple Contracts for Landscape Maintenance Services at Various Locations in the City of Brea

RECOMMENDATION

1. Ratify Termination of S. C. Yamamoto and,
2. Award Landscape Maintenance Agreements to:
A.) Nieves Landscape Inc. for Mowing at City Parks in the amount of $103,950;
B.) Nieves Landscape Inc. for Landscape Maintenance at City Medians, Parkways and
Greenbelts in the amount of $138,392.64;
C.) Nieves Landscape Inc. for Landscape Maintenance in Maintenance District 1 in the
amount of $16,350;
D.) Nieves Landscape Inc. for Landscape Maintenance in MD 3 in the amount of $27,000;
E.) Nieves Landscape Inc. for Landscape Maintenance in MD 6 in the amount of
$64,999.92;
F.) Nieves Landscape Inc. for Landscape Maintenance in MD 7 in the amount of
$13,410; and
3. Authorize City Manager to approve contract extensions.

BACKGROUND/DISCUSSION

In July of 2020, staff posted a joint City RFP on CIPLIST.com for landscape maintenance services that included mowing, irrigation work, ball field maintenance, playground maintenance and other landscape maintenance activities. Of the 33 companies that downloaded the RFP, eight proposals were received, seven of which were qualified proposers. Staff from Brea and La Habra interviewed all seven companies to determine their ability to perform the work required at competitive rates. After evaluating criteria such as appearance of equipment, company's uniform policy, references, quality of work in the field, proposal quality and interview results, staff ranked the companies as follows:

1. S. C. Yamamoto, Inc.
2. Nieves Landscape, Inc.
3. Mariposa Landscapes, Inc.
4. Complete Landscape Care, Inc.
5. Tropical Plaza Nursery, Inc.
6. Priority Landscape Services, LLC.
7. Merchants Landscape Services, Inc.

Contracts were awarded in December of 2020 to Mariposa Landscapes, Inc., S. C. Yamamoto, Inc. and Tropical Plaza Nursery, Inc. (Contractors). Some of the other contractors withdrew their offers for pricing or not meeting insurance requirements. The effective date of the contracts was January of 2021, for an initial period of four and one half years until June 30, 2025, with three possible one-year extensions at the sole discretion of the City. Awards were made to Contractors in an effort to balance cost efficiencies while maintaining quality.

S.C. Yamamoto was awarded six contracts and has struggled to maintain quality levels in all areas. Staff met with them in December 2020 to review the specific Contract areas and related boundaries to avoid a long learning curve. Staff has also met with them on several other occasions in addition to the daily interactions with our Landscape Contract Administrator. Staff suggested schedules for City and Maintenance District areas to help improve their productivity and quality. On June 22, 2021, staff issued a Notice-to-Cure letter giving the Contractor 30 days to resolve their quality and productivity issues until July 21, 2021. After an unsatisfactory response to the Notice-to-Cure, a 30-day Notice to Terminate was issued on July 21, 2021, which will be effective August 20, 2021.

Staff is recommending the six contracts be awarded to Nieves Landscape, Inc. who rated second highest in all areas evaluated. The following chart shows current prices and recently negotiated prices with Nieves.

Agreement/Contractor	New Contract Price	Current Contract price	Difference
Parks Mowing - Nieves Landscape	$103,950	$68,040	$36,708
Landscape Maintenance at Medians/Entry Markers and Greenbelts - Nieves Landscape	$138,392.86	$139,560	($1,167.14)
Landscape Maintenance in Maintenance District 1 - Nieves Landscape	$16,350	$12,480	$3,870
Landscape Maintenance in Maintenance District 3 - Nieves Landscape	$27,000	$21,120	$5,880
Landscape Maintenance in Maintenance District 6 - Nieves Landscape	$65,000	$60,000	$5,000
Landscape Maintenance in Maintenance District 7 - Nieves Landscape	$13,410	$10,080	$3,330

As shown above, the cost increase to the mowing contract is $35,910 from the current cost and $28,111 more than the pre-RFP contract price of $75,833. Increases to the Districts compared to the pre-RFP contract prices are shown below:

District	New Contract Price	Pre-RFP Contract Price	Difference
M.D. #1	$16,350	$14,712	$1,638
M.D. #3	$27,000	$24,961	$2,039
M.D. #6	$65,000	$66,009	($1,009)
M.D. #7	$13,410	$13,206	$204

If approved, the new contracts with Nieves would go into effect immediately with the initial term to expire on June 30, 2025. Just as with the original landscape contracts, staff recommends the contracts include three possible one-year extensions at the sole discretion of the City. Any potential future CPI increases would be reviewed and approved by the Finance Committee.

COMMISSION/COMMITTEE RECOMMENDATION

This item was reviewed by the Finance Committee at their meeting on August 10, 2021 and recommended for City Council approval.

FISCAL IMPACT/SUMMARY

Staff issued a joint RFP with the City of La Habra in July of 2020. The two cities interviewed the seven proposers and based on the interviews, proposals and references, staff made award recommendations. S.C. Yamamoto has been unable to meet it's contract conditions and was issued a Notice of Termination effective August 20, 2021. Staff is recommending the six contracts be awarded to Nieves Landscape, Inc. The additional funding needed (shown below) will be addressed through the first quarter 2021-2022 budget adjustments:

110-51-5151-4269	$36,708
110-51-5142-4269	$0
341-51-5112-4266	$1,638
343-51-5112-4266	$2,039
346-51-5112-4266	$0
347-51-5112-4266	$204

RESPECTFULLY SUBMITTED:

William Gallardo, City Manager
Prepared by: Bill Bowlus, Public Works Superintendent
Concurrence: Tony Olmos, P.E., Director of Public Works

Attachments
Agreement for Parks Mowing
Agreement - City Medians
Agreement - MD1
Agreement - MD3
Agreement - MD6
Agreement MD7
Notice to Cure
Notice of Termination
Fee Schedule Parks Mowing
Fee Schedule City Medians Greenbelts Entry Markers
Fee Schedule MD1
Fee Schedule MD3
Fee Schedule MD6
Fee Schedule MD 7
Approved COI Nieves


City Council Meeting		Agenda Item 27.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:
Investment Policy Guidelines for the City of Brea's Employee Benefits Fund Pension Plan
RECOMMENDATION
Review and approve the Investment Policy Guidelines for the City of Brea’s Employee Benefits Fund Pension Plan through Public Agency Retirement Services (PARS).
BACKGROUND/DISCUSSION
On November 17, 2015, the City Council approved participation within the Public Agencies Post-Employment Benefit Trust Program that established the City of Brea's Employee Benefits Fund Pension Plan ("Plan"). The Plan is administered by Public Agencies Retirement Services (PARS) to assist the City in "pre-funding" its pension obligations in an irrevocable Section 115 Trust account. Some of the benefits of participating in the program are summarized below: City maintains oversight of investment management and control over the risk tolerance level of the portfolio; Assets held in the PARS Section 115 Trust account allow for greater investment flexibility and risk diversification compared to the City's General Fund investments; Assets could be accessed to offset unexpected CalPERS rate increases (rate stabilization); Potential to improve an agency's bond rating; and Flexibility to access assets at any time as long as it is used to pay employer's pension obligations. The investment strategies for these assets are defined within the City's Investment Policy Guidelines that were developed and evaluated by PARS, HighMark Capital Management (the Plan’s Investment Advisory Firm) and the City's Investment Advisory Committee (IAC). The purpose of the Investment Policy Guidelines is to facilitate communication and confirm the City's investment objectives for the Plan. It also helps maintain a long-term perspective when market volatility is caused by short-term market movements. The policy also details the Plan's Trustee, the Investment Manager and the Investment Advisory Committee's roles and responsibilities. On January 19, 2016, the City Council adopted the City’s Investment Policy Guidelines for the Plan and confirmed the Investment Advisory Committee's recommendation of selecting the “Balanced” Asset Allocation Strategy of the five strategies offered by the Plan’s Investment Advisory Firm, HighMark Capital Management. This strategy provides growth of principal and income on the long term horizon. On June 26, 2021, the Investment Advisory Committee, including PARS and HighMark Capital Management, reviewed the Investment Policy Guidelines and recommended providing minor clarifying language under the responsibility of the Investment Manager. This provides consistent language as what is presented in the City/Successor Agency Investment Policy. The recommendation is to amend the Investment Policy Guidelines for the City of Brea's Employee Benefits Fund Pension Plan Trust Fund to expand the Investment Manager's responsibility to include or amend the following: Communicate to the City Council, the Investment Advisory Committee, City Treasurer and the Administrative Services Director when investment portfolios demonstrate low performance, if any, which occurs between each periodic report; and If a security owned by the City is downgraded to a level below the requirements of this policy, making the security ineligible for additional purchases, the following steps will be taken: Any actions taken related to the downgrade by the investment manager will be communicated to the City Council, the Investment Advisory Committee, City Treasurer and the Administrative Services Director within two (2) business days. If a decision is mde to retain the secuity, the credit situation will be monitored and reported to the City Council. This change is incorporated as part of the 2021 annual review and no other changes are recommended at this time. For ease of reference, both the redline version and clean version with the recommended changes are attached.
COMMISSION/COMMITTEE RECOMMENDATION
On July 26, 2021, the Investment Advisory Committee reviewed the Investment Policy Guidelines and recommended for City Council approval.
FISCAL IMPACT/SUMMARY
There is no fiscal impact for approving the Investment Policy Guidelines.
RESPECTFULLY SUBMITTED:
William Gallardo, City Manager Prepared by: Alicia Brenner, Senior Fiscal Analyst Concurrence: Cindy Russell, Administrative Services Director

Attachments
Pension Trust Fund Investment Policy Guidelines - Redline Version
Pension Trust Fund Investment Policy Guidelines - Clean Version


City Council Meeting		Agenda Item 28.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:

Investment Policy Guidelines for the City of Brea's Other Post Employment Benefits (OPEB) Trust Fund

RECOMMENDATION

Review and approve the Investment Guidelines for the City's Other Post Employment Benefits (OPEB) Trust Fund through Public Agency Retirement Services (PARS).

BACKGROUND/DISCUSSION

At their May 5, 2020 meeting, the City Council approved the Investment Guidelines as presented for the City's OPEB Trust Program ("Plan") following the Investment Advisory Committee's recommendation of a Moderate Investment Objective. The below chart summarizes the Strategic Asset Allocation for the Moderate Investment Objective:

Strategic Asset Allocation Ranges
Cash	Fixed Income	Equity
0-20%	40%-60%	40%-60%
Policy: 5%	Policy: 45%	Policy: 50%

The goal of the Plan's investment program, as identified in the Investment Guidelines, is to provide a reasonable level of growth which will result in sufficient assets to pay the present and future obligations of the Plan. The following objectives are intended to assist in achieving this goal:

The Plan should seek to earn a return in excess of its policy benchmark over the life of the Plan; and
The Plan’s assets will be managed on a total return basis which takes into consideration both investment income and capital appreciation. While the Plan Sponsor recognizes the importance of preservation of capital, it also adheres to the principle that varying degrees of investment risk are generally rewarded with compensating returns. To achieve these objectives, the Plan Sponsor allocates its assets (asset allocation) with a strategic perspective of the capital markets.

The purpose of the guidelines are to:

Facilitate the process of ongoing communication between the Plan sponsor and its plan fiduciaries;
Confirm the Plan’s investment goals and objectives and management policies applicable to the investment portfolio identified below and obtained from the Plan sponsor;
Provide a framework to construct a well-diversified asset mix that can potentially be expected to meet the account’s investment needs that is consistent with the account’s investment objectives, liquidity considerations and risk tolerance;
Identify any unique considerations that may restrict or limit the investment discretion of its designated investment managers; and
Help maintain a long-term perspective when market volatility is caused by short-term market movements.

In light of the economic uncertainty of the COVID-19 pandemic, the initial contribution to this Plan was temporarily suspended. The Plan currently has no assets and the City Council is anticipated to discuss an initial contribution at the Mid-Year Budget Update in February 2022. Any initial contribution is recommended to be dollar cost averaged over a 12-month period based upon the Investment Advisory Committee recommendation discussed at the April 27, 2020 Investment Advisory Committee meeting.

On June 26, 2021, the Investment Advisory Committee, including PARS and HighMark Capital Management, reviewed the Investment Policy Guidelines and recommended providing minor clarifying language under the responsibility of the Investment Manager. This provides consistent language as what is presented in the City/Successor Agency Investment Policy.

The recommendation is to amend the Investment Policy Guidelines for the City of Brea's Other Post Employment Benefits (OPEB) Trust Fund to expand the Investment Manager's responsibility to include or amend the following:

Communicate to the City Council, the Investment Advisory Committee, City Treasurer and the Administrative Services Director when investment portfolios demonstrate low performance, if any, which occurs between each periodic report; and
If a security owned by the City is downgraded to a level below the requirements of this policy, making the security ineligible for additional purchases, the following steps will be taken:
- Any actions taken related to the downgrade by the investment manager will be communicated to the City Council, the Investment Advisory Committee, City Treasurer and the Administrative Services Director within two (2) business days.
- If a decision is mde to retain the secuity, the credit situation will be monitored and reported to the City Council.

This change is incorporated as part of the 2021 annual review and no other changes are recommended at this time. For ease of reference, both the redline version and clean version with the recommended changes are attached.

COMMISSION/COMMITTEE RECOMMENDATION

On July 26, 2021, the Investment Advisory Committee reviewed the Investment Policy Guidelines and is recommended for City Council approval.

FISCAL IMPACT/SUMMARY

There is no fiscal impact for approving the Investment Policy Guidelines.

RESPECTFULLY SUBMITTED:

William Gallardo, City Manager
Prepared by: Alicia Brenner, Senior Fiscal Analyst
Concurrence: Cindy Russell, Administrative Services Director

Attachments
OPEB Trust Investment Policy Guidelines - Redline Version
OPEB Trust Investment Policy Guidelines - Clean Version


City Council Meeting		Agenda Item 29.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:
Annual Review of Statement of Investment Policy for the City of Brea/Successor Agency to the Brea Redevelopment Agency
RECOMMENDATION
Review and approve the City of Brea/Successor Agency to the Brea Redevelopment Agency Statement of Investment Policy.
BACKGROUND/DISCUSSION
State law allows the City Council to annually adopt the Statement of Investment Policy. Thus, per the City's fiscal policies, "The City Council will review and adopt annually an investment policy as recommended by the Investment Advisory Committee." The Investment Policy serves as a guideline for the investment of City and Successor Agency funds. The Brea Investment Advisory Committee annually reviews the Statement of Investment Policy for the City of Brea and the Successor Agency to the Brea Redevelopment Agency. The below changes and additions were recommended by Chandler Asset Management, the City's Portfolio Manager, and were reviewed by the Investment Advisory Committee (IAC). The City's current investment policy takes advantage of the maximum allowable allocation in the Government Code for permitted investments such as Medium Term Corporate Notes, Pass Thru Securities, Bankers Acceptances, Money Market Funds, etc. Additionally, SB 998 provides updates regarding investment in zero or negative interest accrual investments. These changes were recommend by Chandler in order for the City's Investment Policy to be consistent with the passing of SB 988, which went into effect January 1, 2021. Investment Instruments Section (Commercial Paper) – Update the language related to the maximum allowable allocation to Commercial Paper. SB 998 allows public agencies with more $100,000,000 of investable assets to increase the percent of portfolio invested in commercial paper to 40%. This provision is set to expire on January 1, 2026 (page 3). However, at the Investment Advisory Committee Meeting on July 26, 2021, the Committee recommended that the maximum allocation to Commercial Paper remain at its current allocation of 25%. Therefore, this change has since then been removed from the policy. Prohibited Investments Section (zero or negative interest accrual investments) – SB 998 Authorizes a local agency to invest in securities issued or backed by the United States government that could result in zero- or negative- interest accrual if held to maturity. Currently, zero and negative interest rate policies are currently being adopted by multiple developed market central banks: a. US Federal Reserve Fed Funds Policy Rate: 0.00% to 0.25% b. European Central Bank Policy Rate: -0.50% c. Bank of Japan Policy Rate: -0.10% Existing law generally prohibits a local agency from investing any funds that could result in zero interest accrual if held to maturity. The amendment accommodates the possibility of a negative yield investment environment, if it should occur like it has in other developed countries. Leaving the funds in the bank may also result in a zero- or negative- interest accrual because of additional fees and penalties applied to large deposits and banks may also limit the size of deposits that can be held in an account in a negative yield environment because they are no longer profitable. The change requested is to adopt SB 998 as a risk mitigation tool. The base case does not call for a negative rate policy in the US; however, with rates already pegged close to zero, the policy tool cannot be ruled out. The language added to the policy also includes language that zero or negative interest securities, “will only be permitted in the portfolio in the event the United States Federal Reserve adopts a negative interest rate monetary policy framework” and “notification to the City Council , the Investment Advisory Committee, the City Treasurer, and the Administrative Services Director will be given within two (2) business days when securities of this type are being added to the portfolio.” (page 4). The IAC agreed with this recommendation and this change has been included in the proposed policy. Also, references throughout the Investment Policy to the Revenue and Budget Manager have changed to reflect the revised position to Financial Services Manager. This title change was approved by the City Council with the adoption of the FY 2021-22 Budget. These changes were approved by the IAC and included in the proposed policy. For ease of reference, the current Investment Policy is attached along with the red-lined version with recommended changes. In addition, a clean version with the recommended changes is also attached.
COMMISSION/COMMITTEE RECOMMENDATION
The Investment Advisory Committee reviewed this item at their July 26, 2021 meeting and it was recommended for City Council approval.
FISCAL IMPACT/SUMMARY
There is no fiscal impact from the adoption of the Statement of Investment Policy.
RESPECTFULLY SUBMITTED:
William Gallardo, City Manager Prepared by: Faith Madrazo, Financial Services Manager Concurrence: Cindy Russell, Administrative Services Director

Attachments
Current Investment Policy - Adopted 8/18/20
Proposed Final Investment Policy - Redlined Version
Proposed Final Investment Policy - Clean Version


City Council Meeting		Agenda Item 30.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:
Monthly Report of Cash Investments for the City of Brea for Period Ended June 30, 2021
RECOMMENDATION
Receive and file.
BACKGROUND/DISCUSSION
The Monthly Report of Cash and Investments is in accordance with Government Code Sections (GCS) 41004 and 53607 and contains information on the cash and investment activities for the month of June 2021. Cash for day-to-day activities is deposited in the demand and interest-bearing checking accounts. The Local Agency Investment Fund (LAIF) is used for short term investment and functions like a savings account. The City’s managed investment portfolio is for longer-term investments which are managed through Chandler Asset Management (Chandler). Together, the short and long-term investment accounts represent the City’s investment portfolio. Attachment A includes a Cash and Investment Information Summary and Monthly Account Statement prepared by Chandler for invested funds. The book value is the cost plus or minus amortization/accretion. As of June 30, 2021, the total market value of the managed investment portfolio, including accrued interest, was $93,846,505.70 as compared to $94,041,781.82 at May 31, 2021. The weighted average investment yield for June 30, 2021 was 1.51%, which was slightly less than the prior month. The City’s Local Agency Investment Fund (LAIF) had a total market value, including accrued interest of $13,595,671.90 at June 30, 2021. This brings the total value of the City’s investment portfolio as of June 30, 2021 to $107,442,177.60 as compared to $111,133,896.34 at May 31, 2021. The City has restricted cash and investments held in the post-employment benefits trust account administered by PARS (PARS account), which are managed by HighMark Capital (HighMark) and the City's various bond reserve accounts which are managed by Chandler. Attachment A includes a monthly statement from US Bank for the PARS account as well as a portfolio report from Chandler for each bond reserve account that is invested. As of June 30, 2021, the market value of the PARS account, including short-term cash and accrued interest was $11,003,079.92 compared to $10,888,174.09 from the prior month. All other restricted cash investments (bond reserve accounts), including short-term cash and accrued interest, was $3,400,280.00 in comparison to $1,134,368.65 from the prior month. Pursuant to the City's investment policy, all City investments, with the exception of LAIF, direct time certificates of deposits and money market mutual funds, are held by third-party custodians, The Bank of New York Mellon Trust Company, N.A. (BNY) for accounts managed by Chandler and US Bank for the PARS account managed by HighMark which act as agents of the City. These financial institutions are not a counter party to the investment transaction and all securities are held in the name of the City of Brea. The custodial accounts have been reconciled to the par value of the applicable portfolio report for the month. The City of Brea has sufficient cash flow to meet its expected expenditures for the next six months.
COMMISSION/COMMITTEE RECOMMENDATION
On July 26, 2021, the Investment Advisory Committee reviewed the Monthly Report of Investments and recommended that the City Council receive and file.
FISCAL IMPACT/SUMMARY
During the month of June, the total value of the City's investment portfolio decreased by $3,691,718.74. The decrease was primarily due to funds being sent to the City's bond trustee in anticipation of debt service payments for the 2004 and 2010 Refunding Lease Revenue Bonds as well as the 2014, 2019 and 2020 Water Bonds. The City's PARS account increased by $114,905.83 due to market rate adjustments and the City's bond reserve accounts increased by $2,265,911.35 due to the aforementioned debt service payments.
RESPECTFULLY SUBMITTED:
William Gallardo, City Manager Prepared by: Alicia Brenner, Senior Fiscal Analyst Concurrence: Cindy Russell, Administrative Services Director

Attachments
Attachment A


City Council Meeting		Agenda Item 33.
Meeting Date:	08/17/2021
FROM:	Bill Gallardo, City Manager

Subject:
Annual Review of Statement of Investment Policy for the City of Brea/Successor Agency to the Brea Redevelopment Agency
RECOMMENDATION
Review and approve the City of Brea/Successor Agency to the Brea Redevelopment Agency Statement of Investment Policy.
BACKGROUND/DISCUSSION
State law allows the City Council to annually adopt the Statement of Investment Policy. Thus, per the City's fiscal policies, "The City Council will review and adopt annually an investment policy as recommended by the Investment Advisory Committee." The Investment Policy serves as a guideline for the investment of City and Successor Agency funds. The Brea Investment Advisory Committee annually reviews the Statement of Investment Policy for the City of Brea and the Successor Agency to the Brea Redevelopment Agency. The below changes and additions were recommended by Chandler Asset Management, the City's Portfolio Manager, and were reviewed by the Investment Advisory Committee (IAC). The City's current investment policy takes advantage of the maximum allowable allocation in the Government Code for permitted investments such as Medium Term Corporate Notes, Pass Thru Securities, Bankers Acceptances, Money Market Funds, etc. Additionally, SB 998 provides updates regarding investment in zero or negative interest accrual investments. These changes were recommend by Chandler in order for the City's Investment Policy to be consistent with the passing of SB 988, which went into effect January 1, 2021. Investment Instruments Section (Commercial Paper) – Update the language related to the maximum allowable allocation to Commercial Paper. SB 998 allows public agencies with more $100,000,000 of investable assets to increase the percent of portfolio invested in commercial paper to 40%. This provision is set to expire on January 1, 2026 (page 3). However, at the Investment Advisory Committee Meeting on July 26, 2021, the Committee recommended that the maximum allocation to Commercial Paper remain at its current allocation of 25%. Therefore, this change has since then been removed from the policy. Prohibited Investments Section (zero or negative interest accrual investments) – SB 998 Authorizes a local agency to invest in securities issued or backed by the United States government that could result in zero- or negative- interest accrual if held to maturity. Currently, zero and negative interest rate policies are currently being adopted by multiple developed market central banks: a. US Federal Reserve Fed Funds Policy Rate: 0.00% to 0.25% b. European Central Bank Policy Rate: -0.50% c. Bank of Japan Policy Rate: -0.10% Existing law generally prohibits a local agency from investing any funds that could result in zero interest accrual if held to maturity. The amendment accommodates the possibility of a negative yield investment environment, if it should occur like it has in other developed countries. Leaving the funds in the bank may also result in a zero- or negative- interest accrual because of additional fees and penalties applied to large deposits and banks may also limit the size of deposits that can be held in an account in a negative yield environment because they are no longer profitable. The change requested is to adopt SB 998 as a risk mitigation tool. The base case does not call for a negative rate policy in the US; however, with rates already pegged close to zero, the policy tool cannot be ruled out. The language added to the policy also includes language that zero or negative interest securities, “will only be permitted in the portfolio in the event the United States Federal Reserve adopts a negative interest rate monetary policy framework” and “notification to the City Council , the Investment Advisory Committee, the City Treasurer, and the Administrative Services Director will be given within two (2) business days when securities of this type are being added to the portfolio.” (page 4). The IAC agreed with this recommendation and this change has been included in the proposed policy. Also, references throughout the Investment Policy to the Revenue and Budget Manager have changed to reflect the revised position to Financial Services Manager. This title change was approved by the City Council with the adoption of the FY 2021-22 Budget. These changes were approved by the IAC and included in the proposed policy. For ease of reference, the current Investment Policy is attached along with the red-lined version with recommended changes. In addition, a clean version with the recommended changes is also attached.
COMMISSION/COMMITTEE RECOMMENDATION
The Investment Advisory Committee reviewed this item at their July 26, 2021 meeting and it was recommended for City Council approval.
FISCAL IMPACT/SUMMARY
There is no fiscal impact from the adoption of the Statement of Investment Policy.
RESPECTFULLY SUBMITTED:
William Gallardo, City Manager Prepared by: Faith Madrazo, Financial Services Manager Concurrence: Cindy Russell, Administrative Services Director

Attachments
Current Investment Policy - Adopted 8/18/20
Proposed Final Investment Policy - Redlined Version
Proposed Final Investment Policy - Clean Version