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NBS Government Finance Group; 2023-02-14;
City Attorney Approved Version 12/28/2022 1 AGREEMENT FOR PARK-IN-LIEU & PARK DEVELOPMENT IMPACT STUDY SERVICES NBS GOVERNMENT FINANCE GROUP THIS AGREEMENT is made and entered into as of the ______________ day of _________________________, 20___, by and between the City of Carlsbad, California, a municipal corporation, ("City"), and NBS Government Finance Group, a financial consulting company, ("Contractor"). RECITALS A. City requires the professional services of a financial consulting firm that is experienced in park-in-lieu and park development impact fee studies. B. Contractor has the necessary experience in providing professional services and advice related to park-in-lieu and park development impact fee studies. C. Contractor has submitted a proposal to City and has affirmed its willingness and ability to perform such work. NOW, THEREFORE, in consideration of these recitals and the mutual covenants contained herein, City and Contractor agree as follows: 1. SCOPE OF WORK City retains Contractor to perform, and Contractor agrees to render, those services (the "Services") that are defined in attached Exhibit "A", which is incorporated by this reference in accordance with this Agreement’s terms and conditions. 2. STANDARD OF PERFORMANCE While performing the Services, Contractor will exercise the reasonable professional care and skill customarily exercised by reputable members of Contractor's profession practicing in the Metropolitan Southern California Area, and will use reasonable diligence and best judgment while exercising its professional skill and expertise. 3. TERM The term of this Agreement will be effective for a period of one (1) year from the date first above written. The City Manager may amend the Agreement to extend it for one (1) additional one-year periods or parts thereof. Extensions will be based upon a satisfactory review of Contractor's performance, City needs, and appropriation of funds by the City Council. The parties will prepare a written amendment indicating the effective date and length of the extended Agreement. 4. TIME IS OF THE ESSENCE Time is of the essence for each and every provision of this Agreement. 5. COMPENSATION The total fee payable for the Services to be performed during the initial Agreement term will be thirty-five thousand dollars ($35,000). No other compensation for the Services will be allowed except for items covered by subsequent amendments to this Agreement. If the City elects to extend the Agreement, the total compensation amount shall not exceed thirty-five thousand dollars ($35,000). The City reserves the right to withhold a ten percent (10%) retention until City has accepted the work and/or Services specified in Exhibit "A". Incremental payments, if applicable, should be made as outlined in attached Exhibit "A". DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 14th February 23 City Attorney Approved Version 12/28/2022 2 6. STATUS OF CONTRACTOR Contractor will perform the Services in Contractor's own way as an independent contractor and in pursuit of Contractor's independent calling, and not as an employee of City. Contractor will be under control of City only as to the result to be accomplished, but will consult with City as necessary. The persons used by Contractor to provide services under this Agreement will not be considered employees of City for any purposes. The payment made to Contractor pursuant to the Agreement will be the full and complete compensation to which Contractor is entitled. City will not make any federal or state tax withholdings on behalf of Contractor or its agents, employees or subcontractors. City will not be required to pay any workers' compensation insurance or unemployment contributions on behalf of Contractor or its employees or subcontractors. Contractor agrees to indemnify City within thirty (30) days for any tax, retirement contribution, social security, overtime payment, unemployment payment or workers' compensation payment which City may be required to make on behalf of Contractor or any agent, employee, or subcontractor of Contractor for work done under this Agreement. At the City’s election, City may deduct the indemnification amount from any balance owing to Contractor. 7. SUBCONTRACTING Contractor will not subcontract any portion of the Services without prior written approval of City. If Contractor subcontracts any of the Services, Contractor will be fully responsible to City for the acts and omissions of Contractor's subcontractor and of the persons either directly or indirectly employed by the subcontractor, as Contractor is for the acts and omissions of persons directly employed by Contractor. Nothing contained in this Agreement will create any contractual relationship between any subcontractor of Contractor and City. Contractor will be responsible for payment of subcontractors. Contractor will bind every subcontractor and every subcontractor of a subcontractor by the terms of this Agreement applicable to Contractor's work unless specifically noted to the contrary in the subcontract and approved in writing by City. 8. OTHER CONTRACTORS The City reserves the right to employ other Contractors in connection with the Services. 9. INDEMNIFICATION Contractor agrees to indemnify and hold harmless the City and its officers, officials, employees and volunteers from and against all claims, damages, losses and expenses including attorneys fees arising out of the performance of the work described herein caused by any negligence, recklessness, or willful misconduct of the Contractor, any subcontractor, anyone directly or indirectly employed by any of them or anyone for whose acts any of them may be liable. The parties expressly agree that any payment, attorney’s fee, costs or expense City incurs or makes to or on behalf of an injured employee under the City’s self-administered workers’ compensation is included as a loss, expense or cost for the purposes of this section, and that this section will survive the expiration or early termination of this Agreement. 10. INSURANCE Contractor will obtain and maintain for the duration of the Agreement and any and all amendments, insurance against claims for injuries to persons or damage to property which may arise out of or in connection with performance of the services by Contractor or Contractor’s agents, representatives, employees or subcontractors. The insurance will be obtained from an insurance carrier admitted and authorized to do business in the State of California. The insurance carrier is required to have a current Best's Key Rating of not less than "A-:VII"; OR with a surplus line insurer on the State of California’s List of Approved Surplus Line Insurers (LASLI) with a rating DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 3 in the latest Best’s Key Rating Guide of at least “A:X”; OR an alien non-admitted insurer listed by the National Association of Insurance Commissioners (NAIC) latest quarterly listings report. 10.1 Coverage and Limits. Contractor will maintain the types of coverage and minimum limits indicated below, unless the Risk Manager or City Manager approves a lower amount. These minimum amounts of coverage will not constitute any limitations or cap on Contractor's indemnification obligations under this Agreement. City, its officers, agents and employees make no representation that the limits of the insurance specified to be carried by Contractor pursuant to this Agreement are adequate to protect Contractor. If Contractor believes that any required insurance coverage is inadequate, Contractor will obtain such additional insurance coverage, as Contractor deems adequate, at Contractor's sole expense. The full limits available to the named insured shall also be available and applicable to the City as an additional insured. 10.1.1 Commercial General Liability (CGL) Insurance. Insurance written on an “occurrence” basis, including personal & advertising injury, with limits no less than $2,000,000 per occurrence. If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required occurrence limit. 10.1.2 Automobile Liability. (if the use of an automobile is involved for Contractor's work for City). $2,000,000 combined single-limit per accident for bodily injury and property damage. 10.1.3 Workers' Compensation and Employer's Liability. Workers' Compensation limits as required by the California Labor Code. Workers' Compensation will not be required if Contractor has no employees and provides, to City's satisfaction, a declaration stating this. 10.1.4 Professional Liability. Errors and omissions liability appropriate to Contractor’s profession with limits of not less than $1,000,000 per claim. Coverage must be maintained for a period of five years following the date of completion of the work. 10.2 Additional Provisions. Contractor will ensure that the policies of insurance required under this Agreement contain, or are endorsed to contain, the following provisions: 10.2.1 The City will be named as an additional insured on Commercial General Liability which shall provide primary coverage to the City. 10.2.2 Contractor will obtain occurrence coverage, excluding Professional Liability, which will be written as claims-made coverage. 10.2.3 This insurance will be in force during the life of the Agreement and any extensions of it and will not be canceled without thirty (30) days prior written notice to City sent by certified mail pursuant to the Notice provisions of this Agreement. 10.3 Providing Certificates of Insurance and Endorsements. Prior to City's execution of this Agreement, Contractor will furnish certificates of insurance and endorsements to City. 10.4 Failure to Maintain Coverage. If Contractor fails to maintain any of these insurance coverages, then City will have the option to declare Contractor in breach, or may purchase replacement insurance or pay the premiums that are due on existing policies in order to maintain the required coverages. Contractor is responsible for any payments made by City to obtain or maintain insurance and City may collect these payments from Contractor or deduct the amount paid from any sums due Contractor under this Agreement. DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 4 10.5 Submission of Insurance Policies. City reserves the right to require, at any time, complete and certified copies of any or all required insurance policies and endorsements. 11. BUSINESS LICENSE Contractor will obtain and maintain a City of Carlsbad Business License for the term of the Agreement, as may be amended from time-to-time. 12. ACCOUNTING RECORDS Contractor will maintain complete and accurate records with respect to costs incurred under this Agreement. All records will be clearly identifiable. Contractor will allow a representative of City during normal business hours to examine, audit, and make transcripts or copies of records and any other documents created pursuant to this Agreement. Contractor will allow inspection of all work, data, documents, proceedings, and activities related to the Agreement for a period of three (3) years from the date of final payment under this Agreement. 13. OWNERSHIP OF DOCUMENTS All work product produced by Contractor or its agents, employees, and subcontractors pursuant to this Agreement is the property of City. In the event this Agreement is terminated, all work product produced by Contractor or its agents, employees and subcontractors pursuant to this Agreement will be delivered at once to City. Contractor will have the right to make one (1) copy of the work product for Contractor’s records. 14. COPYRIGHTS Contractor agrees that all copyrights that arise from the services will be vested in City and Contractor relinquishes all claims to the copyrights in favor of City. 15. NOTICES The name of the persons who are authorized to give written notice or to receive written notice on behalf of City and on behalf of Contractor under this Agreement. For City For Contractor Name Todd Reese Name Nicole Kissam Title Parks Services Manager Title Project Director Department Parks & Recreation Address 32605 Temecula Parkway, Ste 100 City of Carlsbad Temecula, CA 92592 Address 799 Pine Ave., Ste 200 Phone No. 800-676-7516 Email nkissam@nbsgov.com Phone No. 442-339-2151 Each party will notify the other immediately of any changes of address that would require any notice or delivery to be directed to another address. DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 5 16. CONFLICT OF INTEREST Contractor shall file a Conflict of Interest Statement with the City Clerk in accordance with the requirements of the City of Carlsbad Conflict of Interest Code. The Contractor shall report investments or interests in all categories. Yes No 17. GENERAL COMPLIANCE WITH LAWS Contractor will keep fully informed of federal, state and local laws and ordinances and regulations which in any manner affect those employed by Contractor, or in any way affect the performance of the Services by Contractor. Contractor will at all times observe and comply with these laws, ordinances, and regulations and will be responsible for the compliance of Contractor's services with all applicable laws, ordinances and regulations. Contractor will be aware of the requirements of the Immigration Reform and Control Act of 1986 and will comply with those requirements, including, but not limited to, verifying the eligibility for employment of all agents, employees, subcontractors and consultants whose services are required by this Agreement. 18. DISCRIMINATION AND HARASSMENT PROHIBITED Contractor will comply with all applicable local, state and federal laws and regulations prohibiting discrimination and harassment. 19. DISPUTE RESOLUTION If a dispute should arise regarding the performance of the Services the following procedure will be used to resolve any questions of fact or interpretation not otherwise settled by agreement between the parties. Representatives of Contractor or City will reduce such questions, and their respective views, to writing. A copy of such documented dispute will be forwarded to both parties involved along with recommended methods of resolution, which would be of benefit to both parties. The representative receiving the letter will reply to the letter along with a recommended method of resolution within ten (10) business days. If the resolution thus obtained is unsatisfactory to the aggrieved party, a letter outlining the disputes will be forwarded to the City Manager. The City Manager will consider the facts and solutions recommended by each party and may then opt to direct a solution to the problem. In such cases, the action of the City Manager will be binding upon the parties involved, although nothing in this procedure will prohibit the parties from seeking remedies available to them at law. 20. TERMINATION In the event of the Contractor's failure to prosecute, deliver, or perform the Services, City may terminate this Agreement for nonperformance by notifying Contractor by certified mail of the termination. If City decides to abandon or indefinitely postpone the work or services contemplated by this Agreement, City may terminate this Agreement upon written notice to Contractor. Upon notification of termination, Contractor has five (5) business days to deliver any documents owned by City and all work in progress to City address contained in this Agreement. City will make a determination of fact based upon the work product delivered to City and of the percentage of work that Contractor has performed which is usable and of worth to City in having the Agreement completed. Based upon that finding City will determine the final payment of the Agreement. City may terminate this Agreement by tendering thirty (30) days written notice to Contractor. Contractor may terminate this Agreement by tendering ____ days written notice to City. In the event of termination of this Agreement by either party and upon request of City, Contractor will DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 6 assemble the work product and put it in order for proper filing and closing and deliver it to City. Contractor will be paid for work performed to the termination date; however, the total will not exceed the lump sum fee payable under this Agreement. City will make the final determination as to the portions of tasks completed and the compensation to be made. 21. COVENANTS AGAINST CONTINGENT FEES Contractor warrants that Contractor has not employed or retained any company or person, other than a bona fide employee working for Contractor, to solicit or secure this Agreement, and that Contractor has not paid or agreed to pay any company or person, other than a bona fide employee, any fee, commission, percentage, brokerage fee, gift, or any other consideration contingent upon, or resulting from, the award or making of this Agreement. For breach or violation of this warranty, City will have the right to annul this Agreement without liability, or, in its discretion, to deduct from the Agreement price or consideration, or otherwise recover, the full amount of the fee, commission, percentage, brokerage fees, gift, or contingent fee. 22. CLAIMS AND LAWSUITS By signing this Agreement, Contractor agrees that any Agreement claim submitted to City must be asserted as part of the Agreement process as set forth in this Agreement and not in anticipation of litigation or in conjunction with litigation. Contractor acknowledges that if a false claim is submitted to City, it may be considered fraud and Contractor may be subject to criminal prosecution. Contractor acknowledges that California Government Code sections 12650 et seq., the False Claims Act applies to this Agreement and, provides for civil penalties where a person knowingly submits a false claim to a public entity. These provisions include false claims made with deliberate ignorance of the false information or in reckless disregard of the truth or falsity of information. If City seeks to recover penalties pursuant to the False Claims Act, it is entitled to recover its litigation costs, including attorney's fees. Contractor acknowledges that the filing of a false claim may subject Contractor to an administrative debarment proceeding as the result of which Contractor may be prevented to act as a Contractor on any public work or improvement for a period of up to five (5) years. Contractor acknowledges debarment by another jurisdiction is grounds for City to terminate this Agreement. 23. JURISDICTION AND VENUE Any action at law or in equity brought by either of the parties for the purpose of enforcing a right or rights provided for by this Agreement will be tried in a court of competent jurisdiction in the County of San Diego, State of California, and the parties waive all provisions of law providing for a change of venue in these proceedings to any other county. 24. SUCCESSORS AND ASSIGNS It is mutually understood and agreed that this Agreement will be binding upon City and Contractor and their respective successors. Neither this Agreement nor any part of it nor any monies due or to become due under it may be assigned by Contractor without the prior consent of City, which shall not be unreasonably withheld. 25. ENTIRE AGREEMENT This Agreement, together with any other written document referred to or contemplated by it, along with the purchase order for this Agreement and its provisions, embody the entire Agreement and understanding between the parties relating to the subject matter of it. In case of conflict, the terms of the Agreement supersede the purchase order. Neither this Agreement nor any of its provisions may be amended, modified, waived or discharged except in a writing signed by both parties. DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 7 26. AUTHORITY The individuals executing this Agreement and the instruments referenced in it on behalf of Contractor each represent and warrant that they have the legal power, right and actual authority to bind Contractor to the terms and conditions of this Agreement. CONTRACTOR CITY OF CARLSBAD, a municipal corporation of the State of California By: By: (sign here) [INSERT TITLE OF PERSON AUTHORIZED TO SIGN (City Manager or Mayor or Division Director as authorized by the City Manager)] David Ketcham, Vice President (print name/title) ATTEST: By: (sign here) SHERRY FREISINGER Michael Rentner, President/Secretary City Clerk (print name/title) If required by City, proper notarial acknowledgment of execution by contractor must be attached. If a corporation, Agreement must be signed by one corporate officer from each of the following two groups. Group A Group B Chairman, Secretary, President, or Assistant Secretary, Vice-President CFO or Assistant Treasurer Otherwise, the corporation must attach a resolution certified by the secretary or assistant secretary under corporate seal empowering the officer(s) signing to bind the corporation. APPROVED AS TO FORM: CINDIE K. McMAHON, City Attorney BY: _____________________________ Deputy / Assistant City Attorney DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 Mic1,o.J, ~ City Attorney Approved Version 12/28/2022 8 EXHIBIT “A” SCOPE OF SERVICES FULL SCOPE OF SERVICES (STUDY - QUIMBY ACT FEES IN LIEU OF LAND DEDICATION AND DEVELOPMENT IMPACT FEES FOR CITY’S PARKS & RECREATION FACILITIES) Basic Scope of Services: Park-In-Lieu (Quimby) Fee Program Update As a basic scope of services, NBS is available to assist the City with updating all aspects of the Park-In-Lieu fee program. The work plan for this engagement would encompass the following steps: TASK 1. KICKOFF MEETING/PROJECT INITIATION Attend a kickoff meeting with key City staff and carry out other activities required to initiate the study, including: • Discuss the goals, work plan and schedule for the project • Establish coordination, communication and reporting procedures • Conduct initial interviews with key City staff members • Evaluate available information resources • Review the existing Park-In-Lieu fee program and identify any issues of concern to the City TASK 2. COMPILE DATA ON EXISTING RESIDENTIAL DEVELOPMENT In this task, NBS will collect, review, organize and analyze data on existing residential development in the City and compile it in a form useful for this study. Steps in that process may include: • Establish boundaries of the study area to be used in the analysis • Define the breakdown of land use types to be used in the study • Identify persons per dwelling unit factors for each land use type • Prepare development data tables to incorporate into the fee calculation model and the study report TASK 3. LEVEL OF SERVICE ANALYSIS DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 9 NBS will review the City’s adopted level-of-service standards for the fee program and actual service levels through an analysis of the current inventory of park land as compared to population to determine how many acres of park land are available per 1,000 population in the City. The minimum standard authorized by the Quimby Act is three acres per 1,000, and maximum is five acres per 1,000. This analysis can be completed Citywide, but may not be possible by quadrant unless population information is available by quadrant. TASK 4. MARKET VALUE OF LAND ANALYSIS NBS will use our data subscription service to CoStar to compile a list of land values to represent the fair market value of land in each City quadrant and/or Citywide. Section 20.44.080 of the City’s fee ordinance indicates the fair market value shall be determined by the City Council using a survey of the market value of undeveloped property. The survey may be prepared through various means including, but not limited to, selection of several real estate professionals within Carlsbad to provide current estimates of undeveloped property values. While NBS staff are not real estate professionals, access to CoStar’s database can provide a reasonable estimate of recent land sales in the City for purposes of updating the fee program. The City will need to decide whether this is a desired approach to obtaining this information for purposes of the fee study. TASK 5. IN-LIEU FEE ANALYSIS Using the information developed in previous tasks, NBS will construct a spreadsheet fee calculation model incorporating data on existing development, existing park acres per 1,000 population, average market land values, and appropriate population per unit demand factors. The result of this task will calculate a schedule of Park-In-Lieu fees per unit of development, by development type. TASK 6. FEE COMPARISON NBS will complete a comparison of Park-In-Lieu fee programs in up to five (5) neighboring and comparable communities. A list of communities will be selected and approved by City staff. NBS will download their respective fee schedules, supporting studies, and/or relevant municipal codes from the Internet. If schedules and supporting studies are not available on the Internet, NBS will make a reasonable attempt to contact the agency to obtain that information. NBS will then compile a comparison of the fee categories and amounts, for the most readily comparable fee items that match the City’s existing and proposed fees. TASK 7. DRAFT AND FINAL STUDY REPORTS NBS will prepare a memo outlining the data, methodology and formulas used in the fee calculations. The memo will propose fee amounts that comply with the Quimby Act for City Council’s consideration, and recommend any best practices or areas of improvement for consideration in implementation of the Park-In-Lieu fees into the Carlsbad Municipal Code’s fee formula and fee program parameters. DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 10 Deliverables include: (1) preliminary draft for staff review; (2) a final draft report; (3) the final report. All drafts and the final report will be submitted electronically in .PDF format. TASK 8. MEETINGS AND PRESENTATIONS In general, NBS has assumed all meetings with staff for purposes of developing the final findings and reports as described above will be conducted remotely. NBS has the tools to accomplish all aspects of the project’s work plan remotely from NBS offices. NBS utilizes video conferencing, email, and telephone to coordinate on the project and review deliverables in an effective manner. At the implementation stage of the project, NBS is available to present the Study’s outcomes to the City Council and/or City stakeholders if requested. In this presentation, NBS will review the study process, present study results and recommendations, receive input and guidance on the direction of the study, and answer questions. NBS will prepare a PowerPoint presentation which will include visual aids, graphics, charts, and additional worksheets or handouts. Within the scope of proposed services, NBS has assumed one (1) remotely conducted or in-person presentation of results. Full Scope of Services: Park-In-Lieu and Development Impact Fees Study The City’s current Park-In-Lieu fee program only applies to projects within residential subdivisions and is meant to provide a mechanism for acquisition of park land accordingly. However, there are opportunities to expand the Park-In-Lieu fee program to add other types of development impact fees, such as: • Parkland Acquisition impact fees for residential development projects not within a subdivision • Park Improvement and Recreational Facilities impact fees for all types of residential development projects (subdivision and non-subdivision) The specific scope of services offered in this proposal is defined by the tasks described in the work plan that follows. The work plan builds upon the work completed in the Basic Scope of Services for the Park-In-Lieu fee analysis, and adds necessary steps to provide the City with a schedule of development impact fees. That scope excludes legal, engineering, architectural, cost estimating and appraisal services. TASK 1. COMPILE DATA ON EXISTING AND FUTURE DEVELOPMENT In this task, NBS will build upon the work completed in Option 1, Task 1 to further collect, review, organize and analyze data on existing development as well as future development in the City and compile it in a form useful for this study. Steps in that process may include: • Define the breakdown of land use types to be used in the study, including unit size categories for residential development that comply with the requirements of AB602 DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 11 • Analyze land use data provided by the City and other agencies to establish a baseline of existing development and a forecast of future development by land use type • Identify demand variables and specify demand factors that will be used to represent the impact of development in the impact fee calculations • Prepare development data tables to incorporate into the fee calculation model and the study report TASK 2. LEVEL OF SERVICE ANALYSIS Development Impact Fees for parks and recreational facilities can provide essential funding for park improvements, trails, recreational buildings, and amenities needed to serve new development. Based on recent changes in impact fee law, fees for parks and recreational facilities must be calculated to reflect the existing level of service currently enjoyed by the existing population. Commonly known as the Standard-Based or Incremental Expansion Method, fees will be calculated based on the cost of maintaining a particular level of service, where that level of service can be translated directly into facility costs. Steps in defining the existing level of service will include the following: • Review the City’s park inventory, fixed asset records, facility master plans, and other available documentation to establish an inventory of existing park and recreational facilities • Review adopted level-of-service standards and actual service levels for relevant facility types • Identify any existing deficiencies or available capacity relative to the level of service standard • Project the additional service demand that will be created by new development, based on the selected service levels • Compile cost estimates for relevant facilities and other assets • Identify costs eligible for impact fee funding NBS will also consult the City’s Capital Improvement Program as needed to identify new recreational facilities, facility expansions, vehicles and equipment needed to serve future development. Including this information as supplemental in the report will support the City in meeting the requirements of AB 602. TASK 3. IMPACT FEE ANALYSIS Using the information developed in previous tasks, NBS will conduct the impact fee analysis and calculate impact fees by land use type for each type of facility addressed in the study. That process typically includes these steps: • Construct a spreadsheet fee calculation model incorporating data on existing and future development, demand factors and eligible facility costs DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 12 • Specify formulas in the model to allocate facility costs in proportion to the impact of new residential development by land use type • Calculate a cost per capita for each facility type • Convert the cost per capita into a schedule of impact fees per unit of development, by development type • Project potential revenue from the proposed fees TASK 4. FEE COMPARISON NBS will complete a comparison of park and recreation impact fee programs in up to five (5) neighboring and comparable communities. A list of communities will be selected and approved by City staff. NBS will download their respective fee schedules, supporting studies, and/or relevant municipal codes from the Internet. If schedules and supporting studies are not available on the Internet, NBS will make a reasonable attempt to contact the agency to obtain that information. NBS will then compile a comparison of the fee categories and amounts, for the most readily comparable fee items that match the City’s existing and proposed fees. TASK 5. DRAFT AND FINAL STUDY REPORTS The impact fee study report will explain the data, methodology and formulas used in the fee calculations and document the nexus between the proposed fees and the impacts of development for each type of impact fee calculated in the study. The report will also propose findings to satisfy the requirements of the Mitigation Fee Act regarding the purpose of the fees, the use of the fees, and the reasonable relationship between the fees and development. As the study progresses, NBS will submit preliminary drafts of portions of the study report for review and comment by City staff. Once all sections are in draft form, an administrative draft of the entire study report, incorporating any previous staff comments, will be submitted for review. Then a final draft document will be prepared for the City Council. As needed, additional changes will be incorporated into the final study report. The study report will include the following components: • An Executive Summary including summary impact fee tables • A chapter discussing the legal requirements for impact fees and methods used to calculate the fees • A chapter presenting data on existing and future development in the study area and the factors used to measure the impacts of development on individual facility types • A separate chapter for each type of fee presenting the data and methodology used in the analysis, a detailed explanation the impact fee calculations, and documentation of the nexus DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 13 • A chapter on implementation recommendations, covering steps needed to comply with the Mitigation Fee Act through proper administration of the impact fees, including but not limited to: ✓ Findings and enactment of fees ✓ Collection and expenditure of fees ✓ Accounting and reporting requirements ✓ Administrative appeals, waivers, and exemptions ✓ Credits and reimbursements for developer-provided facilities ✓ Updating and indexing the fees ✓ Recovery of administrative costs for the impact fee program Deliverables include: (1) Preliminary chapter drafts; (2) a complete draft report for staff review; (3) a final draft report; (4) the final report. All drafts and the final report will be submitted electronically in .PDF format. TASK 6. MEETINGS AND PRESENTATIONS In general, NBS has assumed all meetings with staff for purposes of developing the final findings and reports as described above will be conducted remotely. NBS has the tools to accomplish all aspects of the project’s work plan remotely from NBS offices. NBS utilizes video conferencing, email, and telephone to coordinate on the project and review deliverables in an effective manner. At the implementation stage of the project, NBS is available to present the Study’s outcomes to the City Council and/or City stakeholders if requested. In this presentation, NBS will review the study process, present study results and recommendations, receive input and guidance on the direction of the study, and answer questions. NBS will prepare a PowerPoint presentation which will include visual aids, graphics, charts, and additional worksheets or handouts. Within the scope of proposed services, NBS has assumed one (1) remotely conducted or in-person presentation of results. Information to be provided by the City of Carlsbad The work to be performed on this fee study will depend heavily on information to be provided by the City. Among the types of information that may be needed for this study are: • The City’s capital improvement program, level of service policies, facility master plans and other facility planning data, plus inventories of existing facilities and vehicles and equipment of types to be funded by impact fees DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 City Attorney Approved Version 12/28/2022 14 • Cost estimates for land, capital improvements, vehicles, and/or equipment to be funded by fees • Information on capital improvement funding sources and financing plans and any outstanding debt related to existing capital facilities • Information on the population served by the City, which may come from one or more of the following sources: the City, the California Department of Finance and/or the U.S. Census Bureau This proposal assumes that all information needed to perform the work covered by the scope of this proposal will be provided by the City or is readily available from other sources. Project timeline A study of this nature typically requires two to three months to issue a final report. The timeline for adoption would be determined by the City following acceptance of the final report. NBS is available to initiate this project. Upon project commencement, a schedule and task plan will be developed for mutual acceptance by the City and consultants. During the data collection tasks of the proposed work plan, NBS will proactively remind the City of agreed upon submittal dates and strive to process submittals quickly to keep the project moving forward. Project cost For the Full Scope of Services, the consulting fee is not to exceed $27,360, as reflected in the Project Cost Detail of the NBS ‘Proposal for a Park-In-Lieu Fee Study Update’ dated Dec. 29, 2022. This price as proposed includes a full study of the Park-In-Lieu fee program as well as establishment of a development impact fee program for parks and recreation facilities. The City will be billed on an hourly basis for the time required to address the key areas of priority for the Park In Lieu fee program update. There will also be an availability of $7,640 for additional as needed services, if authorized in advance of the services by the City. The total not-to-exceed value of this agreement shall be $35,000. DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 helping communities fund tomorrow since 1996 32605 Temecula Parkway, Suite 100 Temecula, CA 92592 Toll free: 800.676.7516 www.nbsgov.com December 29, 2022 Zach Korach Finance Director City of Carlsbad Administrative Services Department 1635 Faraday Ave. Carlsbad, CA 92008 Via email to zach.korach@carlsbadca.gov RE: Proposal for a Park-in-Lieu Fee Study Update Dear Zach, Recently we spoke about possible approaches to updating the City’s Park-In-Lieu fees. The following includes some options for varying types of consulting services for your consideration as well as information regarding our expertise in preparing studies focused on park-focused impact fees. PROJECT BACKGROUND The City may require dedication of land for park and/or recreational facilities, or payment of a fee in-lieu of dedication of land, as a condition of approval for development projects involving a subdivision. The dedication and/or in-lieu fee requirements are authorized by Section 66477 of the Government Code of the State of California, otherwise known as the “Quimby Act”. Chapter 20.44 of the Carlsbad Municipal Code defines the standards and formulas needed for implementation of the requirements at the local level. The formula for determining acreage to be dedicated is equal to: Average no. of persons per dwelling unit based on the most recent federal census X 0.003 (3 park acres per 1,000 population) X Total number of dwelling units Per CMC 20.44.080, when a fee is required to be paid in lieu of land dedication, the amount of the fee shall be based upon the fair market value of the amount of land which would otherwise be required to be dedicated. The approach to determining fair market value is also defined in the Municipal Code and requires a periodic survey of the market value of undeveloped property within the city. DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 Page 2 PDF Page 49 of the City’s FY 2022-23 Master Fee Schedule appears to translate the fee formula into a set of fees per residential unit as follows: Development Type (Residential Subdivisions Only) NE, SE, SW Quadrant Fee per Unit NW Quadrant Fee per Unit Single Family Detached & Duplex $5,728 $7,649 Attached Residential 4 units or less $4,804 $6,414 Attached Residential More than 4 Units $4,636 $6,190 Mobile Homes $3,696 $4,934 SCOPE OF SERVICES The scope of this study depends on what the City’s needs are at this time. A basic scope of services would focus solely on Quimby Act fees in lieu of park land dedication. A full scope of services would also include development impact fees for parks and recreation facilities provided by the City. The following are options for the City’s consideration. Basic Scope of Services: Park-In-Lieu (Quimby) Fee Program Update As a basic scope of services, we are available to assist the City with updating all aspects of the Park-In-Lieu fee program. The work plan for this engagement would encompass the following steps: TASK 1. KICKOFF MEETING/PROJECT INITIATION Attend a kickoff meeting with key City staff and carry out other activities required to initiate the study, including: • Discuss the goals, work plan and schedule for the project • Establish coordination, communication and reporting procedures • Conduct initial interviews with key City staff members • Evaluate available information resources • Review the existing Park-In-Lieu fee program and identify any issues of concern to the City TASK 2. COMPILE DATA ON EXISTING RESIDENTIAL DEVELOPMENT In this task, we will collect, review, organize and analyze data on existing residential development in the City and compile it in a form useful for this study. Steps in that process may include: • Establish boundaries of the study area to be used in the analysis • Define the breakdown of land use types to be used in the study • Identify persons per dwelling unit factors for each land use type • Prepare development data tables to incorporate into the fee calculation model and the study report DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 Page 3 TASK 3. LEVEL OF SERVICE ANALYSIS We will review the City’s adopted level-of-service standards for the fee program and actual service levels through an analysis of the current inventory of park land as compared to population to determine how many acres of park land are available per 1,000 population in the City. The minimum standard authorized by the Quimby Act is three acres per 1,000, and maximum is five acres per 1,000. This analysis can be completed Citywide, but may not be possible by quadrant unless population information is available by quadrant. TASK 4. MARKET VALUE OF LAND ANALYSIS We will use our data subscription service to CoStar to compile a list of land values to represent the fair market value of land in each City quadrant and/or Citywide. Section 20.44.080 of the City’s fee ordinance indicates the fair market value shall be determined by the City Council using a survey of the market value of undeveloped property. The survey may be prepared through various means including, but not limited to, selection of several real estate professionals within Carlsbad to provide current estimates of undeveloped property values. While we are not real estate professionals, access to CoStar’s database can provide a reasonable estimate of recent land sales in the City for purposes of updating the fee program. The City will need to decide whether this is a desired approach to obtaining this information for purposes of the fee study. TASK 5. IN-LIEU FEE ANALYSIS Using the information developed in previous tasks, we will construct a spreadsheet fee calculation model incorporating data on existing development, existing park acres per 1,000 population, average market land values, and appropriate population per unit demand factors. The result of this task will calculate a schedule of Park-In-Lieu fees per unit of development, by development type. TASK 6. FEE COMPARISON We will complete a comparison of Park-In-Lieu fee programs in up to five (5) neighboring and comparable communities. A list of communities will be selected and approved by City staff. We will download their respective fee schedules, supporting studies, and/or relevant municipal codes from the Internet. If schedules and supporting studies are not available on the Internet, we will make a reasonable attempt to contact the agency to obtain that information. We will then compile a comparison of the fee categories and amounts, for the most readily comparable fee items that match the City’s existing and proposed fees. TASK 7. DRAFT AND FINAL STUDY REPORTS We will prepare a memo outlining the data, methodology and formulas used in the fee calculations. The memo will propose fee amounts that comply with the Quimby Act for City Council’s consideration, and recommend any best practices or areas of improvement for consideration in implementation of the Park- In-Lieu fees into the Carlsbad Municipal Code’s fee formula and fee program parameters. DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 Page 4 Deliverables include: (1) preliminary draft for staff review; (2) a final draft report; (3) the final report. All drafts and the final report will be submitted electronically in .PDF format. TASK 8. MEETINGS AND PRESENTATIONS In general, we have assumed all meetings with staff for purposes of developing the final findings and reports as described above will be conducted remotely. We have the tools to accomplish all aspects of the project’s work plan remotely from NBS offices. We utilize video conferencing, email, and telephone to coordinate on the project and review deliverables in an effective manner. At the implementation stage of the project, we are available to present the Study’s outcomes to the City Council and/or City stakeholders if requested. In this presentation, NBS will review the study process, present study results and recommendations, receive input and guidance on the direction of the study, and answer questions. We will prepare a PowerPoint presentation which will include visual aids, graphics, charts, and additional worksheets or handouts. Within the scope of proposed services, we have assumed one (1) remotely conducted or in-person presentation of results. Full Scope of Services: Park-In-Lieu and Development Impact Fees Study The City’s current Park-In-Lieu fee program only applies to projects within residential subdivisions and is meant to provide a mechanism for acquisition of park land accordingly. However, there are opportunities to expand the Park-In-Lieu fee program to add other types of development impact fees, such as: • Parkland Acquisition impact fees for residential development projects not within a subdivision • Park Improvement and Recreational Facilities impact fees for all types of residential development projects (subdivision and non-subdivision) The specific scope of services offered in this proposal is defined by the tasks described in the work plan that follows. The work plan builds upon the work completed in the Basic Scope of Services for the Park-In- Lieu fee analysis, and adds necessary steps to provide the City with a schedule of development impact fees. That scope excludes legal, engineering, architectural, cost estimating and appraisal services. TASK 1. COMPILE DATA ON EXISTING AND FUTURE DEVELOPMENT In this task, we will build upon the work completed in Option 1, Task 1 to further collect, review, organize and analyze data on existing development as well as future development in the City and compile it in a form useful for this study. Steps in that process may include: • Define the breakdown of land use types to be used in the study, including unit size categories for residential development that comply with the requirements of AB602 • Analyze land use data provided by the City and other agencies to establish a baseline of existing development and a forecast of future development by land use type DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 G NBS. Page 5 • Identify demand variables and specify demand factors that will be used to represent the impact of development in the impact fee calculations • Prepare development data tables to incorporate into the fee calculation model and the study report TASK 2. LEVEL OF SERVICE ANALYSIS Development Impact Fees for parks and recreational facilities can provide essential funding for park improvements, trails, recreational buildings, and amenities needed to serve new development. Based on recent changes in impact fee law, fees for parks and recreational facilities must be calculated to reflect the existing level of service currently enjoyed by the existing population. Commonly known as the Standard- Based or Incremental Expansion Method, fees will be calculated based on the cost of maintaining a particular level of service, where that level of service can be translated directly into facility costs. Steps in defining the existing level of service will include the following: • Review the City’s park inventory, fixed asset records, facility master plans, and other available documentation to establish an inventory of existing park and recreational facilities • Review adopted level-of-service standards and actual service levels for relevant facility types • Identify any existing deficiencies or available capacity relative to the level of service standard • Project the additional service demand that will be created by new development, based on the selected service levels • Compile cost estimates for relevant facilities and other assets • Identify costs eligible for impact fee funding We will also consult the City’s Capital Improvement Program as needed to identify new recreational facilities, facility expansions, vehicles and equipment needed to serve future development. Including this information as supplemental in the report will support the City in meeting the requirements of AB 602. TASK 3. IMPACT FEE ANALYSIS Using the information developed in previous tasks, we will conduct the impact fee analysis and calculate impact fees by land use type for each type of facility addressed in the study. That process typically includes these steps: • Construct a spreadsheet fee calculation model incorporating data on existing and future development, demand factors and eligible facility costs • Specify formulas in the model to allocate facility costs in proportion to the impact of new residential development by land use type • Calculate a cost per capita for each facility type • Convert the cost per capita into a schedule of impact fees per unit of development, by development type • Project potential revenue from the proposed fees TASK 4. FEE COMPARISON We will complete a comparison of park and recreation impact fee programs in up to five (5) neighboring and comparable communities. A list of communities will be selected and approved by City staff. We will DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 G NBS. Page 6 download their respective fee schedules, supporting studies, and/or relevant municipal codes from the Internet. If schedules and supporting studies are not available on the Internet, we will make a reasonable attempt to contact the agency to obtain that information. We will then compile a comparison of the fee categories and amounts, for the most readily comparable fee items that match the City’s existing and proposed fees. TASK 5. DRAFT AND FINAL STUDY REPORTS The impact fee study report will explain the data, methodology and formulas used in the fee calculations and document the nexus between the proposed fees and the impacts of development for each type of impact fee calculated in the study. The report will also propose findings to satisfy the requirements of the Mitigation Fee Act regarding the purpose of the fees, the use of the fees, and the reasonable relationship between the fees and development. As the study progresses, we will submit preliminary drafts of portions of the study report for review and comment by City staff. Once all sections are in draft form, an administrative draft of the entire study report, incorporating any previous staff comments, will be submitted for review. Then a final draft document will be prepared for the City Council. As needed, additional changes will be incorporated into the final study report. The study report will include the following components: • An Executive Summary including summary impact fee tables • A chapter discussing the legal requirements for impact fees and methods used to calculate the fees • A chapter presenting data on existing and future development in the study area and the factors used to measure the impacts of development on individual facility types • A separate chapter for each type of fee presenting the data and methodology used in the analysis, a detailed explanation the impact fee calculations, and documentation of the nexus • A chapter on implementation recommendations, covering steps needed to comply with the Mitigation Fee Act through proper administration of the impact fees, including but not limited to: ✓ Findings and enactment of fees ✓ Collection and expenditure of fees ✓ Accounting and reporting requirements ✓ Administrative appeals, waivers, and exemptions ✓ Credits and reimbursements for developer-provided facilities ✓ Updating and indexing the fees ✓ Recovery of administrative costs for the impact fee program Deliverables include: (1) Preliminary chapter drafts; (2) a complete draft report for staff review; (3) a final draft report; (4) the final report. All drafts and the final report will be submitted electronically in .PDF format. DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 G NBS. Page 7 TASK 6. MEETINGS AND PRESENTATIONS In general, we have assumed all meetings with staff for purposes of developing the final findings and reports as described above will be conducted remotely. We have the tools to accomplish all aspects of the project’s work plan remotely from NBS offices. We utilize video conferencing, email, and telephone to coordinate on the project and review deliverables in an effective manner. At the implementation stage of the project, we are available to present the Study’s outcomes to the City Council and/or City stakeholders if requested. In this presentation, NBS will review the study process, present study results and recommendations, receive input and guidance on the direction of the study, and answer questions. We will prepare a PowerPoint presentation which will include visual aids, graphics, charts, and additional worksheets or handouts. Within the scope of proposed services, we have assumed one (1) remotely conducted or in-person presentation of results. INFORMATION TO BE PROVIDED BY THE CITY The work to be performed on this fee study will depend heavily on information to be provided by the City. Among the types of information that may be needed for this study are: • The City’s capital improvement program, level of service policies, facility master plans and other facility planning data, plus inventories of existing facilities and vehicles and equipment of types to be funded by impact fees • Cost estimates for land, capital improvements, vehicles, and/or equipment to be funded by fees • Information on capital improvement funding sources and financing plans and any outstanding debt related to existing capital facilities • Information on the population served by the City, which may come from one or more of the following sources: the City, the California Department of Finance and/or the U.S. Census Bureau This proposal assumes that all information needed to perform the work covered by the scope of this proposal will be provided by the City or is readily available from other sources. ESTIMATED PROJECT TIMELINE A study of this nature typically requires two to three months to issue a final report. The timeline for adoption would be determined by the City following acceptance of the final report. We are available to initiate this project at any time. Upon project commencement, a schedule and task plan will be developed for mutual acceptance by the City and consultants. During the data collection tasks of the proposed work plan, we will proactively remind the City of agreed upon submittal dates and strive to process submittals quickly to keep the project moving forward. PROPOSED STAFF For this engagement, NBS will engage Colgan Consulting as a subcontractor. NBS and Colgan Consulting have a successful and exclusive relationship providing impact fee analysis to California agencies. We have DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 Page 8 completed numerous similar studies together over the past four years, and Joe Colgan has over 30 years of impact fee experience. A list of agencies and type of impact fee are provided below. TYPE OF IMPACT FEE Agency Park Land / Improvements Public Safety Public Buildings Roads / Traffic Storm Drain Water / Sewer City of Angels Camp City of Beaumont City of Chowchilla City of Cloverdale City of Eastvale City of Encinitas City of Indio City of La Quinta City of Lemoore City of Madera City of Moreno Valley City of Orange City of Orland City of Rancho Cucamonga City of Rocklin City of Victorville City of Visalia (ADU Fee Policy) City of Vista City of Watsonville City of Wildomar East Contra Costa Fire Protection District Groveland CSD Lathrop Manteca Fire District Moraga Orinda Fire District Rancho Cucamonga Fire District Sacramento Metropolitan Fire District Town of Ross Town of Windsor DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 Page 9 NBS will manage the project and provide technical support as needed, and Joe Colgan of Colgan Consulting will assume the role of Impact Fee Specialist providing most of the industry experience and technical leadership required for the project. NICOLE KISSAM, PROJECT MANAGER Roles and Responsibilities: Nicole Kissam is based in our Southern California offices, and she will provide leadership on this project including serving as the primary point of contact for the City‘s staff and directing the work efforts of our project team. Nicole will be fully conversant in all findings and available for public events as needed. She will assist Joe Colgan in all aspects of project design and analysis and provide senior- level technical analysis throughout the project. Work Experience: Nicole Kissam is a Director of the NBS Financial Consulting Group. She has 20 years of experience as a financial consultant to the public sector and has managed many impact fee studies for both large and small agencies. Nicole has been a financial and management consultant to California’s local governments for most of her career, specializing in impact fee analysis, user and regulatory fee analysis, cost allocation and grant related cost recovery, and operational improvement strategies. Prior to her career in public sector consulting, Nicole worked in a City finance department for several years, and also in marketing and public relations firms. Nicole holds a Bachelor of Science in Business Administration from California Polytechnic State University in San Luis Obispo. JOE COLGAN, COLGAN CONSULTING, IMPACT FEE SPECIALIST Roles and Responsibilities: Joe Colgan will work closely with NBS and other team members as the technical expert on this impact fee analysis. Work Experience: Joe Colgan is the President of Colgan Consulting and a recognized expert in impact fee analysis with over 30 years of experience in the field. He is a professional planner with 10 years of direct experience in local government as a planner and planning director, and extensive experience in land use planning and capital facilities planning. He has served three terms on the board of the National Impact Fee Roundtable (now the Growth and Infrastructure Consortium), including one term as vice chair, and has spoken on impact fees at conferences and seminars nationally. LAUREN GUIDO, CONSULTANT Roles and Responsibilities: Under the direction of the project manager, Lauren Guido will support this project as needed with the completion of key aspects of the project’s Task Plan, including but not limited to fee model development, data collection and analysis, timeline management, draft reviews, and documentation efforts. Work Experience: Lauren Guido is a Consultant with NBS. She brings four years of fee study analysis experience and more than a decade of accounting and financial management experience in the public and private sectors to our project team. She has extensive applied skills in analytical software, databases, and spreadsheets and a special talent for graphical display of complex information in presentations to elected and community stakeholders. Lauren has a Bachelor of Fine Arts and Multimedia from Woodbury University. DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 G NBS. Page 10 STEPHANIE PARSON, CLIENT SERVICES DIRECTOR Roles and Responsibilities: Stephanie Parson will act as a representative of our corporate commitment to providing the highest level of service. She will ensure that the City’s fundamental objectives are being met at all times. Summary of Work Experience: Stephanie Parson is a Director with NBS where she works on consulting projects for Special Financing Districts, including CFDs, Property and Business Improvement Districts, Landscape and Lighting Districts, Benefit Assessment Districts, 1913 Act Assessment Districts, and Parcel Taxes. She has 20 years of experience with NBS and is a Registered Municipal Advisor. Full-length resumes of key personnel are attached at end of this proposal. DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 G NBS. Page 11 SAMPLE REFERENCES Below provides three recent projects of similar size that included evaluation of Park-in-Lieu and/or Development Impact Fees for parks and recreation facilities. CITY OF INDIO DEVELOPMENT IMPACT FEE STUDY Project Dates: June 2019 – May 2020 Contact Information This comprehensive review and update of the City of Indio’s impact fee program included the following fees: Park Land and Improvements, Police Facilities, Fire Protection Facilities, Public Buildings, Roads and Bridges, Traffic Signals, Storm Drainage Improvements, and Water System Improvements. The final report for this Study was completed in May 2020 and adoption was delayed due to pandemic related issues. The results were successfully adopted by City Council in December 2021. Rob Rockwell Assistant City Manager and Finance Director 100 Civic Center Mall Indio, CA 92201 P: 760.391.4029 E: rrockwell@indio.org NBS Project Team: Nicole Kissam, Joe Colgan CITY OF LA QUINTA IMPACT FEE UPDATE STUDY Project Dates: January 2019 - October 2019 Contact Information This study updated all of La Quinta’s existing impact fees, including fees for parks, community and cultural centers, civic center, library, fire protection and transportation. This was the first impact fee study La Quinta has contracted out since Joe Colgan prepared an impact fee study for the City in 1998. Since that time, the City has conducted several in- house updates. In this study, NBS expanded the scope of the community center impact fee to include cultural facilities and updated costs used in some other impact fees to reflect interest costs for debt used to fund those facilities. The transportation impact fees were calculated in two parts. Costs for improvements that add capacity for vehicular traffic were allocated entirely to future development, while costs for improvements to bikeways and pedestrian facilities were split between existing and future development. The final draft impact fee study was presented to the La Quinta City Council on October 1, 2019 and was referred to the Financial Advisory Commission which strongly endorsed the study and recommended adoption of the fees. The City Council adopted the impact fees in April 2020 to be phased in over two years. Julie Mignogna Management Analyst Design and Development Dept. 78495 Calle Tampico La Quinta, CA 92253 P: 760-777-7041 E: jmignogna@laquinta.gov NBS Project Team: Nicole Kissam, Joe Colgan DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 Page 12 CITY OF ROCKLIN IMPACT FEE STUDY – PARK IMPROVEMENTS AND PUBLIC FACILITIES Service Dates: July 2019 – June 2022 Contact Information NBS and Colgan updated Rocklin’s impact fees for park improvements, community and recreation facilities and general government facilities including Police and Fire facilities. Those fees had not been updated since 2006. We worked with a committee consisting of the City Manager, Assistant City Manager and several department heads to identify an approach to the impact fee update, and to address the existence of a development agreement that controlled park impact fees for much of the new development in the City. We also worked closely with the City’s Finance Department to address outstanding debt on some facilities. The project team met several times with the local building industry to answer questions about methodology and industry standards, and to resolve issues of concern to builders and developers. Impact fees based on this study were adopted by the Rocklin City Council in June 2022. Aly Zimmerman City Manager 3970 Rocklin Road Rocklin, CA 95677 P: 916.625.5583 E: alyz@rocklin.ca.us NBS Project Team: Nicole Kissam, Joe Colgan PROPOSED PROJECT COST Our professional fees are based on our understanding of the City’s needs and the effort we believe is necessary to complete the scope of services/task plan described. We express this honestly and transparently through our price proposal. The Basic Scope of Services option described above, we propose a not to exceed professional fee of $12,000. The City would be billed on an hourly basis for the time required to address the key areas of priority for the Park-In-Lieu fee program update. The following provides an estimated breakdown of hours required by task and hourly rate: DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 ROCKLIN CALIFORNIA Page 13 For the Full Scope of Services, we propose a consulting fee not to exceed $27,360. This price as proposed includes a full study of the Park In Lieu fee program as well as establishment of a development impact fee program for parks and recreation facilities. The City would be billed on an hourly basis for the time required to address the key areas of priority for the Park In Lieu fee program update. The following provides an estimated breakdown of hours required by task and hourly rate: PROJECT COST DETAIL Task Plan Hourly Rate $210 $150 $150 Basic Scope of Services: Park In Lieu (Quimby) Fee Program Update 1 - Kickoff Meeting/Project Initiation 2.0 2.0 0.0 4.0 720 2 - Compile Data on Existing Residential Development 3.0 3.0 0.0 6.0 1,080 3 - Level of Service Analysis 0.0 8.0 0.0 8.0 1,200 4 - Market Value of Land Analysis 2.0 2.0 8.0 12.0 1,920 0.0 8.0 0.0 8.0 1,200 6 - Fee Comparison 2.0 0.0 10.0 12.0 1,920 7 - Draft and Final Study Reports 2.0 8.0 2.0 12.0 1,920 8 - Meetings and Presentations 4.0 4.0 4.0 12.0 2,040 TOTAL NOT TO EXCEED PROJECT COST 15.0 35.0 24.0 74.0 12,000$ 5 - In Lieu Fee Analysis Consultant Labor (Hours)Grand Totals Nicole Kissam, Project Manager Joe Colgan, Impact Fee Specialist Lauren Guido, NBS Consultant Consultant Labor (Hours) Consultant Costs ($) PROJECT COST DETAIL Task Plan Hourly Rate $210 $150 $150 Full Scope of Services: Park In Lieu and Development Impact Fees Study 1 - Compile Data on Existing and Future Development 4.0 16.0 0.0 20.0 3,240 2 - Facility Needs Analysis 12.0 24.0 0.0 36.0 6,120 3 - Impact Fee Analysis 12.0 24.0 0.0 36.0 6,120 4 - Fee Comparison 4.0 0.0 20.0 24.0 3,840 5 - Draft and Final Study Reports 8.0 16.0 6.0 30.0 4,980 6 - Meetings and Presentations 6.0 8.0 4.0 18.0 3,060 TOTAL NOT TO EXCEED PROJECT COST 46.0 88.0 30.0 164.0 27,360$ Consultant Labor (Hours)Grand Totals Nicole Kissam, Project Manager Joe Colgan, Impact Fee Specialist Lauren Guido, NBS Consultant Consultant Labor (Hours) Consultant Costs ($) DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 Page 14 The following hourly rates are inclusive of all costs associated with professional time, such as document production, and incidentals. Travel expenses, if required, would be approved, and charged separately. These rates will apply for the duration of our contract: Title Hourly Rate Director - NBS $210 Colgan Consulting $150 Consultant - NBS $150 We invoice on a monthly basis, following recorded consultant time on the project, paralleling our completion of the work. At no time will we invoice for charges in excess of the fee to which the City of Carlsbad and NBS mutually agree. Should the City specifically request additional services beyond those described in this document, we will discuss those requests and associated costs at that later time and only invoice for additional fees upon separate written authorization from the City. CONCLUSION Thank you for the opportunity to serve the City in this capacity, and please contact me at 800.676.7516 or via email at nkissam@nbsgov.com if you have any questions or concerns. We would genuinely like to work on this project and help the City move forward. Sincerely, Nicole Kissam Director DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 Page 15 TEAM RESUME NICOLE KISSAM | Project Director EDUCATION • Bachelor of Science, Business Administration, California Polytechnic State University, San Luis Obispo AFFILIATIONS • California Society of Municipal Finance Officers (CSMFO) • Growth and Infrastructure Consortium (GIC) SPEAKING / MEDIA (LAST 5 YEARS) • “Cost Allocation Plans (CAP) Best Practices; A Discussion of CAP Basics, Timelines, Case Studies, and In-House vs. Vendor- supported Approaches” - California State Association of County Auditors (SACA) Conference, 2021 • “A Revenue Cornucopia: One Special District’s Approach to Raising Revenue” - California Special Districts Association (CSDA), Exhibitor Series, 2020 • “Tools for Fiscal Sustainability” - CSMFO Desert Chapter, 2020 • “Fees, Fees, and MORE FEES!?” - California Association of Recreation and Park Districts, Annual Conference, 2019 • “Building Department Fees…you need a plan” - California Building Officials (CALBO) Annual Business Meeting, 2018 HIGHLIGHTS Nicole Kissam is Director of Financial Consulting for NBS. She has more than 20 years of experience in public sector consulting, city government, marketing, and public relations. Nicole specializes in cost recovery and revenue policy for California local governments. She routinely manages projects and provides senior level technical analysis on impact fee studies, user/regulatory fee analyses, cost allocation plans, and financial plans. She has completed over 100 consulting engagements for a range of cities, counties, and special districts, including those with less than 10,000 population up to the largest in the State such as Los Angeles, Sacramento, and San Jose. Her background also includes performance of various management audits that improved operational efficiency of development services, parks and recreation, and utility departments. Nicole is regularly invited to speak on the topics of cost recovery, fee program development, and fiscal sustainability for various prominent professional organizations in California. RELEVANT PROJECT EXPERIENCE • East Contra Costa Fire Protection District, Impact Fee Study and Fire Prevention Regulatory Fee Study – Completed a complex analysis of impact fees for the District, requiring the merging of several different legacy fee structures from the County and two incorporated cities served by the District. The Study required participation with interested developers, has been successfully adopted in 2020 by the County and one incorporated city, and is pending final adoption by the second city’s Council in February 2021. NBS also developed a first Regulatory fee program for the District’s newly added fire prevention division, adopted in 2020. • City of Indio, Citywide Development Impact Fee Study – Fees evaluated included Park Land and Improvements, Fire Protection Facilities, Police Facilities, Public Buildings, Roads and Bridges, Traffic Signals, Storm Drainage Improvements. Final Report issued in May 2020, pending public hearing and adoption by City Council. • City of La Quinta, Development Impact Fee Study – Fees evaluated included Parks and Recreation, Community and Cultural Centers, Library, Civic Center, Maintenance Facilities, Transportation. Adoption process involved working with local building industry associations. Fee program adopted successfully by Council in 2019. • Los Angeles, Tree In-Lieu Fee Analysis for the Board of Public Works – Evaluated the cost of sourcing, planting, and maintaining trees paid for “in-lieu” of conditions of development for protected trees and other types of City trees. Assisted in implementing a fee program with the Board of Public Works. • Other Recent Impact Fee Projects – Lathrop Manteca Fire District, Moraga Orinda Fire Protection District, City of Orland, Plymouth, Rancho Cucamonga, Rocklin, Town of Ross, Sacramento Metropolitan Fire District “Thanks again for another successful fee study. Always a pleasure working with you and your team.” Greg McFann, Building Official City of Alameda DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 QNBS helplng communities fund tomorrow Page 16 TEAM RESUME JOE COLGAN | Impact Fee Specialist EDUCATION • Master of City Planning degree, University of Pennsylvania Bachelor of Architecture degree, University of Nebraska, Lincoln AFFILIATIONS • Growth and Infrastructure Consortium (formerly the National Impact Fee Roundtable) • Over 35 years as a member of the American Planning Association (APA) and the American Institute of Certified Planners (AICP) SPEAKING / MEDIA • National Impact Fee Roundtable | 2004 2005, 2007, 2009, 2011 • California Association of Recreation and Parks Districts | 2019 HIGHLIGHTS Joe Colgan is founder and president of Colgan Consulting Corporation, a small Sacramento firm specializing in development impact fees for cities, counties and special districts. He has a thorough understanding of the constitutional and statutory requirements for defensible impact fees and is an expert in impact fee methodologies. The vast majority of Joe’s impact fee work has been done for California clients, but he has also done impact fee studies in Oregon, Arizona, Utah, New Mexico and Florida. He has prepared more than 150 impact fee studies since 1990, for clients as large as Albuquerque, NM (pop. 555,000) and the Orange County (CA) Fire Authority (serving 22 cities and unincorporated Orange County), and as small as Angels Camp, CA (pop. 4,050) RELEVANT PROJECT EXPERIENCE • Indio, CA, Comprehensive Impact Fee Study • Manhattan Beach, CA, Impact Fee Feasibility Study • Wildomar, CA, Comprehensive Impact Fee Study and Two Impact Fee Update Studies • City of Rocklin, CA, Parks and Public Facilities Impact Fee Study • Vista, CA, Impact Fee Update Study for Streets and Signals; Joe has prepared four impact fee studies for Vista • La Quinta, CA, Comprehensive Impact Fee Studies and Updates; Joe has prepared three impact fee studies for La Quinta • City of Orange, CA, Impact Fee Study for Police, Libraries and Parks • Lemoore, CA, Comprehensive Impact Fee Studies and Updates; Joe has prepared four impact fee studies for Lemoore • Madera, CA, Comprehensive Impact Fee Study and Update • Beaumont, CA, Comprehensive Impact Fee Study • Windsor, CA, Impact Fee Study for Parks and Rec, Open Space and Trails, Police, Fire and Public Facilities • Cloverdale, CA, Impact Fee Study for Accessory Dwelling Units • Moreno Valley CA, Comprehensive Impact Fee Studies and Updates; Joe has prepared four impact fee studies for Moreno Valley • Encinitas, CA, Impact Fee Study Streets and Signals, Parks, Fire and Libraries; Joe has prepared three impact fee studies for Encinitas • Rancho Cucamonga, CA, Two Impact Fee Studies for Parks, Community & Recreation Centers, Libraries, Police, and the Animal Center DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 • • Colgan Consulting Corporation Page 17 EDUCATION • Bachelor of Fine Arts and Multimedia, Woodbury University, Burbank HIGHLIGHTS • Experienced Consultant supporting cost allocation, user and regulatory fee studies • Extensive experience in budget management and financial reporting • Extensive experience working with analytical software, databases, and spreadsheets BIOGRAPHY Lauren Guido offers more than a decade of finance experience in accounting, budget planning and systems analysis. She performs various financial analyses, data management, and customer data analyses for Overhead Cost Allocation Plans and User Fee Studies. Lauren’s diverse knowledge of accounting, budgeting, and resource management is essential to the work performed by NBS. RELEVANT PROJECT EXPERIENCE Lauren has consulted and served on many projects, including the following representative and recent project samples: • City of Alameda, Building, Planning, Public Works, and Fire Fee Study • City of Albany, Building, and Planning Fee Study • City of Camarillo, Citywide User Fee Study • East Contra Costa Fire Protection District, Fire Prevention Regulatory Fee Study and Fire Facilities Development Impact Fee Study • City of Indio, Citywide Fee Study Update and Development Impact Fee Study • City of Lathrop, Building Fee Study • City of Los Angeles, Department of City Planning Fee Study • City of Los Angeles, Department of City Planning, Home Sharing Ordinance Fee Study • City of Modesto, Recreation Fee Study • City of Portola Valley, Development Services Fee Study • Rancho Cucamonga Fire Protection District, Regulatory Fee Analysis • City of San Diego, Park and Recreation Department Fee Study • San Diego Unified School District, Theater Rental Rate Study • City of San Ramon, Planning Fee Study • City of Tracy, Citywide User Fee Study and Internal Service Fund Rates Analysis • City of Tustin, Citywide User Fee Study • City of Yorba Linda, Citywide Fee Study TEAM RESUME LAUREN GUIDO | Consultant “Lauren was terrific in helping to deliver this project for us. She took the time to dive into the more technical and detailed aspects of a very unique subject area, kept the project moving, and was in constant communication with us as the client. Would love to work with her again on any project.” Raoul Mendoza, Chief Management Analyst, Los Angeles City Planning DocuSign Envelope ID: 4E5C5A7D-6353-4E6A-B7B4-34F00540A892 '' ONBS helping communities rund tomorrow ANY PROPRIETOR/PARTNER/EXECUTIVEOFFICER/MEMBER EXCLUDED? INSR ADDL SUBRLTR INSD WVD PRODUCER CONTACTNAME:FAXPHONE(A/C, No):(A/C, No, Ext): E-MAILADDRESS: INSURER A : INSURED INSURER B : INSURER C : INSURER D : INSURER E : INSURER F : POLICY NUMBER POLICY EFF POLICY EXPTYPE OF INSURANCE LIMITS(MM/DD/YYYY) (MM/DD/YYYY) AUTOMOBILE LIABILITY UMBRELLA LIAB EXCESS LIAB WORKERS COMPENSATIONAND EMPLOYERS' LIABILITY DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (ACORD 101, Additional Remarks Schedule, may be attached if more space is required) AUTHORIZED REPRESENTATIVE EACH OCCURRENCE $DAMAGE TO RENTEDCLAIMS-MADE OCCUR $PREMISES (Ea occurrence) MED EXP (Any one person) $ PERSONAL & ADV INJURY $ GEN'L AGGREGATE LIMIT APPLIES PER:GENERAL AGGREGATE $ PRO-POLICY LOC PRODUCTS - COMP/OP AGGJECT OTHER:$COMBINED SINGLE LIMIT $(Ea accident) ANY AUTO BODILY INJURY (Per person) $OWNED SCHEDULED BODILY INJURY (Per accident) $AUTOS ONLY AUTOS HIRED NON-OWNED PROPERTY DAMAGE $AUTOS ONLY AUTOS ONLY (Per accident) $ OCCUR EACH OCCURRENCE CLAIMS-MADE AGGREGATE $ DED RETENTION $ PER OTH-STATUTE ER E.L. EACH ACCIDENT E.L. DISEASE - EA EMPLOYEE $If yes, describe under E.L. DISEASE - POLICY LIMITDESCRIPTION OF OPERATIONS below INSURER(S) AFFORDING COVERAGE NAIC # COMMERCIAL GENERAL LIABILITY Y / N N / A(Mandatory in NH) SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED INACCORDANCE WITH THE POLICY PROVISIONS. THIS IS TO CERTIFY THAT THE POLICIES OF INSURANCE LISTED BELOW HAVE BEEN ISSUED TO THE INSURED NAMED ABOVE FOR THE POLICY PERIOD INDICATED. NOTWITHSTANDING ANY REQUIREMENT, TERM OR CONDITION OF ANY CONTRACT OR OTHER DOCUMENT WITH RESPECT TO WHICH THIS CERTIFICATE MAY BE ISSUED OR MAY PERTAIN, THE INSURANCE AFFORDED BY THE POLICIES DESCRIBED HEREIN IS SUBJECT TO ALL THE TERMS,EXCLUSIONS AND CONDITIONS OF SUCH POLICIES. LIMITS SHOWN MAY HAVE BEEN REDUCED BY PAID CLAIMS. THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THISCERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIESBELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZEDREPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. IMPORTANT: If the certificate holder is an ADDITIONAL INSURED, the policy(ies) must have ADDITIONAL INSURED provisions or be endorsed. If SUBROGATION IS WAIVED, subject to the terms and conditions of the policy, certain policies may require an endorsement. A statement onthis certificate does not confer rights to the certificate holder in lieu of such endorsement(s). COVERAGES CERTIFICATE NUMBER:REVISION NUMBER: CERTIFICATE HOLDER CANCELLATION © 1988-2015 ACORD CORPORATION. All rights reserved.ACORD 25 (2016/03) CERTIFICATE OF LIABILITY INSURANCE DATE (MM/DD/YYYY) $ $ $ $ $ The ACORD name and logo are registered marks of ACORD 9/26/2022 License # 0L48969 22292 NBS Government Finance Group32605 Temecula Parkway, Suite 100 Temecula, CA 92592 22306 10833 A 2,000,000 XXOH3A43196309 9/24/2022 9/24/2023 300,000 10,000 2,000,000 4,000,000 4,000,000 1,000,000A XXAH3A42745811 9/24/2022 9/24/2023 1,000,000A OH3A43196309 9/24/2022 9/24/2023 1,000,000 0 B X WD3A42745709 9/24/2022 9/24/2023 1,000,000N1,000,000 1,000,000 C E&O Professional Lia VNPL010991 9/24/2022 Aggregate 2,000,000 C E&O Professional lia VNPL010991 9/24/2022 9/24/2023 Retention 20,000 Additional insureds are included as/where required by written contract as respects to General Liability, Auto Liability; General Liability Primary Non- Contributory wording; Auto Liability Primary Non-Contributory wording, General Liability waiver of subrogation, Auto Liability waiver of subrogation, WorkersCompensation waiver of subrogation, but limited to the operations of the Insured under said contract, and always subject to all the policy terms, conditions and exclusions per endorsements attached. *THIS CERTIFICATE CANCELS AND SUPERSEDES ANY CERTIFICATE PREVIOUSLY ISSUED.* Blanket forms apply when required by written contract:GENERAL LIABILITY: SEE ATTACHED ACORD 101 City of Carlsbad Attn: Aaron Beanan 1635 Faraday Ave. Carlsbad, CA 92008 NBSGOVE-01 CHUHE1 C3 Risk & Insurance Services404 Camino Del Rio S. STE 410San Diego, CA 92108 Lynne Robinson lynne@c3insurance.com Hanover Insurance Company Massachusetts Bay Insurance Co Gemini Insurance Company X 9/24/2023 X X X X X X X ACORD" I ~ I ~ □ □ ~ ~ ~ □ □ ~ ~ ~ ~ ~ ~ ~ ~ H I I I I I □ FORM NUMBER: EFFECTIVE DATE: The ACORD name and logo are registered marks of ACORD ADDITIONAL REMARKS ADDITIONAL REMARKS SCHEDULE FORM TITLE: Page of THIS ADDITIONAL REMARKS FORM IS A SCHEDULE TO ACORD FORM, ACORD 101 (2008/01) AGENCY CUSTOMER ID: LOC #: AGENCY NAMED INSURED POLICY NUMBER CARRIER NAIC CODE © 2008 ACORD CORPORATION. All rights reserved. C3 Risk & Insurance Services NBSGOVE-01 SEE PAGE 1 1 SEE PAGE 1 ACORD 25 Certificate of Liability Insurance License # 0L48969 1 SEE P 1 NBS Government Finance Group32605 Temecula Parkway, Suite 100Temecula, CA 92592 SEE PAGE 1 CHUHE1 1 Description of Operations/Locations/Vehicles: Additional Insured-Special Broadening Endt: 391-1006 08 16 Additional Insured-Completed Operations: 391-1602 08 16 Primary & Non-Contributory: 391-1003 08 16 Waiver of Subrogation: 391-1003 08 16 AUTO: Additional Insured: 461-0478 12 12 Primary & Non-Contributory: 461-0478 12 12 Waiver of Subrogation: 461-0500 11 13 WORKERS' COMPENSATION: Waiver of Subrogation: WC 00 03 13 04 84 Deductibles: General Liability- $0 Auto Liability- Comp Ded: $1,000 / Coll Ded: $1,000 Umbrella: $0 Professional Liability- $20,000 deductible (Per Claim). City of Carlsbad, its officials, employees and volunteers are named as additional insured regarding General Liability. ~ ACORD" ~ I THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. BUSINESSOWNERS LIABILITY SPECIAL BROADENING ENDORSEMENT This endorsement modifies insurance provided under the following: BUSINESSOWNERS COVERAGE FORM This endorsement amends coverages provided under the Businessowners Coverage Form through new coverages and broader coverage grants. This coverage is subject to the provisions applicable to the Businessowners Coverage Form, except as provided below. The following changes are made to SECTION II -LIABILITY: 1. Additional Insured by Contract, Agreement orPermit The following is added to SECTION II -LIABILITY, C. Who Is An Insured: Additional Insured by Contract, Agreement orPermit a.Any person or organization with whom youagreed in a written contract, writtenagreement or permit to add such person ororganization as an additional insured onyour policy is an additional insured only withrespect to liability for "bodily injury","property damage", or "personal andadvertising injury" caused, in whole or inpart, by your acts or omissions, or the actsor omissions of those acting on your behalf, but only with respect to: (1)"Your work" for the additional insured(s) designated in the contract, agreement orpermit; (2)Premises you own, rent, lease oroccupy; or (3)Your maintenance, operation or use ofequipment leased to you. b.The insurance afforded to such additionalinsured described above: (1)Only applies to the extent permitted bylaw; and (2)Will not be broader than the insurancewhich you are required by the contract,agreement or permit to provide for suchadditional insured. (3)Applies on a primary basis if that isrequired by the written contract, writtenagreement or permit. (4)Will not be broader than coverageprovided to any other insured. (5)Does not apply if the "bodily injury","property damage" or "personal andadvertising injury"is otherwise excludedfrom coverage under this Coverage Part,including any endorsements thereto. 391-1006 08 16 Includes copyrighted materials of Insurance Services Offices, Inc., with its permission.Page 1 of 6 SUMMARY OF COVERAGES Limits Page 1.Additional Insured by Contract, Agreement or Permit Included 1 2.Additional Insured - Broad Form Vendors 3.Alienated Premises 4.Broad Form Property Damage - Borrowed Equipment, CustomersGoods and Use of Elevators 5.Incidental Malpractice (Employed Nurses, EMT's and Paramedics) 6.Personal and Advertising Injury - Broad Form 7.Product Recall Expense Product Recall Expense Each Occurrence Limit Product Recall Expense Aggregate Limit Product Recall Deductible 8.Unintentional Failure to Disclose Hazards 9.Unintentional Failure to Notify Included Included Included Included Included Included $25,000 $50,000 $500 Included Included 2 3 3 3 4 4 5 5 5 6 6 Aggregate Occurrence 3ROLF\1XPEHU 2+$ OH3A431963 1001678 c.This provision does not apply: (1)Unless the written contract or writtenagreement was executed or permit wasissued prior to the "bodily injury","property damage", or "personal injuryand advertising injury". (2)To any person or organization includedas an insured by another endorsementissued by us and made part of thisCoverage Part. (3)To any lessor of equipment: (a)After the equipment lease expires; or (b)If the "bodily injury", "propertydamage", "personal and advertisinginjury" arises out of sole negligenceof the lessor. (4)To any: (a)Owners or other interests from whomland has been leased if the"occurrence" takes place or theoffense is committed after the leasefor the land expires; or (b)Managers or lessors of premises if: (i)The "occurrence" takes place orthe offense is committed afteryou cease to be a tenant in thatpremises; or (ii)The "bodily injury", "propertydamage", "personal injury" or"advertising injury" arises out of structural alterations, newconstruction or demolitionoperations performed by or on behalf of the manager or lessor. (5)To "bodily injury", "property damage" or"personal and advertising injury" arisingout of the rendering of or the failure torender any professional services. This exclusion applies even if the claimsagainst any insured allege negligence orother wrongdoing in the supervision,hiring, employment, training ormonitoring of others by that insured, ifthe "occurrence" which caused the"bodily injury" or "property damage" orthe offense which caused the "personaland advertising injury" involved therendering of or failure to render anyprofessional services by or for you. d.With respect to the insurance afforded tothese additional insureds, the following isadded to SECTION II - LIABILITY, D. Liabilityand Medical Expense Limits of Insurance : The most we will pay on behalf of theadditional insured for a covered claim is thelesser of the amount of insurance: 1.Required by the contract, agreement orpermit described in Paragraph a.;or 2.Available under the applicable Limits ofInsurance shown in the Declarations. This endorsement shall not increase theapplicable Limits of Insurance shown in theDeclarations e.All other insuring agreements, exclusions,and conditions of the policy apply. 2. Additional Insured - Broad Form Vendors The following is added to SECTION II -LIABILITY, C. Who Is An Insured: Additional Insured - Broad Form Vendors a.Any person or organization that is a vendorwith whom you agreed in a written contractor written agreement to include as anadditional insured under this Coverage Partis an insured, but only with respect to liabilityfor "bodily injury" or "property damage"arising out of "your products" which aredistributedor sold in the regular course ofthe vendor's business. b.The insurance afforded to such vendordescribedabove: (1)Only applies to the extent permitted bylaw; (2)Will not be broader than the insurancewhich you are required by the contract oragreement to provide for such vendor; (3)Will not be broader than coverageprovided to any other insured; and (4)Does not apply if the "bodily injury","property damage" or "personal andadvertising injury" is otherwise excludedfrom coverage under this Coverage Part,including any endorsements thereto c.With respect to insurance afforded to suchvendors, the following additional exclusionsapply: The insurance afforded to the vendor doesnot apply to: (1)"Bodily injury" or "property damage" forwhich the vendor is obligated to paydamages by reasons of the assumption ofliability in a contract or agreement. Thisexclusion does not apply to liability fordamages that the insured would have inthe absence of the contract oragreement; (2)Any express warranty unauthorized byyou; 391-1006 08 16 Includes copyrighted materials of Insurance Services Offices, Inc., with its permission.Page 2 of 6 3ROLF\1XPEHU 2+$ !&~Hanover ~ Jnsurance Group .. (3)Any physical or chemical change in theproduct made intentionally by thevendor; (4)Repackaging, unless unpacked solely forthe purpose of inspection,demonstration, testing, or the substitution of parts under instructionfrom the manufacturer, and thenrepackaged in the original container; (5)Any failure to make such inspection,adjustments, tests or servicing as the vendor has agreed to make or normallyundertakes to make in the usual courseof business in connection with the saleof the product; (6)Demonstration, installation, servicing orrepairoperations, except suchoperations performed at the vendor'spremises in connection with the sale ofthe product; (7)Products which, after distribution or saleby you, have been labeled or relabeledor used as a container, part oringredient of any other thing orsubstance by or for the vendor; (8)"Bodily injury" or "property damage"arising out of the sole negligence of thevendor for its own acts or omissions orthose of its employees or anyone elseacting on its behalf. However, thisexclusion does not apply to: (a)The exceptions contained within theexclusion in subparagraphs (4)or (6)above; or (b)Such inspections, adjustments, testsor servicing as the vendor hasagreed to make or normallyundertakes to make in the usualcourse of business, in connectionwith the distribution or sale of theproducts. (9)"Bodily injury" or "property damage"arising out of an "occurrence" that tookplace before you have signed thecontract or agreement with the vendor. (10)To any person or organization includedas an insured by another endorsementissued by us and made part of thisCoverage Part. (11)Any insured person or organization,from whom you have acquired suchproducts, or any ingredient, part orcontainer, entering into, accompanyingor containing such products. d.With respect to the insurance afforded tothese vendors, the following is added toSECTION II - LIABILITY, D. Liability andMedical Expense Limits of Insurance: The most we will pay on behalf of the vendorfor a covered claim is the lesser of theamount of insurance: 1.Required by the contract or agreementdescribed in Paragraph a.; or 2.Available under the applicable Limits ofInsurance shown in the Declarations; This endorsement shall not increase theapplicable Limits of Insurance shown in theDeclarations. 3. Alienated Premises SECTION II - LIABILITY, B. Exclusions, 1.Applicable To Business Liability Coverage k.Damage to Property,paragraph (2)is replaced bythe following: (2)Premises you sell, give away or abandon, ifthe "property damage" arises out of any partof those premises and occurred from hazardsthat were known by you, or should havereasonably been known by you, at the timethe property was transferred or abandoned. 4. Broad Form Property Damage - BorrowedEquipment, Customers Goods, Use of Elevators a.The following is added to SECTION II -LIABILITY, B. Exclusions, 1. Applicable ToBusiness Liability Coverage, k. Damage toProperty: Paragraph (4)does not apply to "property damage" to borrowed equipment while at ajobsite and not being used to performoperations. Paragraph (3), (4)and (6)do not apply to"property damage" to "customers goods" while on your premises nor to the use ofelevators. b.For the purposes of this endorsement, thefollowing definition is added to SECTION II -LIABILITY, F. Liability and Medical ExpensesDefinitions: 1."Customers goods" means property ofyour customer on your premises for thepurpose of being: a.Worked on; or b.Used in your manufacturing process. c.The insurance afforded under this provision isexcess over any other valid and collectibleproperty insurance (including deductible)available to the insured whether primary,excess, contingent or on any other basis. 5. Incidental Malpractice - Employed Nurses, EMT'sand Paramedics SECTION II - LIABILITY, C. Who Is An Insured,paragraph 2.a.(1)(d) does not apply to a nurse, 391-1006 08 16 Includes copyrighted materials of Insurance Services Offices, Inc., with its permission.Page 3 of 6 3ROLF\1XPEHU 2+$ OH3A431963 1001678 emergency medical technician or paramedicemployed by you if you are not engaged in thebusiness or occupation of providing medical,paramedical, surgical, dental, x-ray or nursingservices. 6. Personal Injury - Broad Form a. SECTION II - LIABILITY, B. Exclusions, 2.Additional Exclusions Applicable only to "Personal and Advertising Injury",paragraphe.is deleted. b. SECTION II - LIABILITY, F. Liability andMedical Expenses Definitions, 14."Personaland advertising injury", paragraph b.isreplaced by the following: b.Malicious prosecution or abuse ofprocess. c.The following is added to SECTION II -LIABILITY, F. Liability and Medical ExpensesDefinitions,Definition 14."Personal andadvertising injury": "Discrimination" (unless insurance thereof isprohibited by law) that results in injury to thefeelings or reputation of a natural person,but only if such "discrimination" is: (1)Not done intentionally by or at thedirection of: (a)The insured; (b)Any officer of the corporation,director, stockholder, partner ormember of the insured; and (2)Not directly or indirectly related to an"employee", not to the employment,prospective employment or terminationof any person or persons by an insured. d.For purposes of this endorsement, thefollowing definition is added to SECTION II -LIABILITY, F. Liability and Medical ExpensesDefinitions: 1."Discrimination" means the unlawfultreatment of individuals based upon race,color, ethnic origin,gender, religion,age,or sexual preference. "Discrimination"does not include the unlawful treatmentof individuals based upon developmental,physical, cognitive, mental, sensory oremotional impairment or anycombination of these. e.This coverage does not apply if liabilitycoverage for "personal and advertisinginjury" is excluded either by the provisions ofthe Coverage Form or any endorsementthereto. 7. Product Recall Expense a. SECTION II - LIABILITY, B. Exclusions, 1.Applicable To Business Liability Coverage, o. Recall of Products, Work or Impairedis replaced by the following: o. Recall of Products, Work or ImpairedProperty Damages claimed for any loss, cost orexpense incurred by you or others forthe loss of use, withdrawal, recall,inspection, repair, replacement,adjustment, removal or disposal of: (1)"Your product"; (2)"Your work"; or (3)"Impaired property"; If such product, work or property iswithdrawn or recalled from the market orfrom use by any person or organizationbecause of a known or suspected defect,deficiency, inadequacy or dangerouscondition in it, but this exclusion doesnot apply to "product recall expenses"that you incur for the "covered recall" of"your product". However, the exception to the exclusiondoes not apply to "product recallexpenses" resulting from: (4)Failure of any products to accomplishtheir intended purpose; (5)Breach of warranties of fitness,quality, durability or performance; (6)Loss of customer approval, or anycost incurred to regain customerapproval; (7)Redistribution or replacement of"your product" which has beenrecalled by like products orsubstitutes; (8)Caprice or whim of the insured; (9)A condition likely to cause loss ofwhich any insured knew or hadreason to know at the inception ofthis insurance; (10)Asbestos, including loss, damage orclean up resulting from asbestos orasbestos containing materials; or (11)Recall of "your products" that haveno known or suspected defect solelybecause a known or suspecteddefect in another of "your products"has been found. b.The following is added to SECTION II -LIABILITY, C. Who Is An Insured,paragraph3.b.: "Product recall expense" arising out of anywithdrawal or recall that occurred before you acquired or formed the organization. 391-1006 08 16 Includes copyrighted materials of Insurance Services Offices, Inc., with its permission.Page 4 of 6 Property 3ROLF\1XPEHU 2+$ !&~Hanover ~ Jnsurance Group .. c.The following is added to SECTION II -LIABILITY, D. Liability and Medical ExpensesLimits of Insurance: Product Recall Expense Limits of Insurance a.The Limits of Insurance shown in the SUMMARY OF COVERAGES of thisendorsement and the rules stated belowfix the most that we will pay under this Product Recall Expense Coverageregardless of the number of: (1)Insureds; (2)"Covered Recalls" initiated; or (3)Number of "your products"withdrawn. b.The Product Recall Expense AggregateLimit is the most that we will reimburseyou for the sum of all "product recallexpenses" incurred for all "coveredrecalls" initiated during the policy period. c.The Product Recall Each OccurrenceLimit is the most we will pay inconnection with any one defect ordeficiency. d.All "product recall expenses" inconnection with substantially the samegeneral harmful condition will bedeemed to arise out of the same defector deficiency and considered one"occurrence". e.Any amount reimbursed for "productrecall expenses" in connection with anyone "occurrence" will reduce the amountof the Product Recall Expense AggregateLimit available for reimbursement of"product recall expenses" in connectionwith any other defect or deficiency. f.If the Product Recall Expense AggregateLimit has been reduced byreimbursement of "product recallexpenses" to an amount that is less thanthe Product Recall Expense EachOccurrence Limit, the remainingAggregate Limit is the most that will beavailable for reimbursement of "productrecall expenses" in connection with anyother defect or deficiency. g. Product Recall Deductible We will only pay for the amount of"product recall expenses" which are inexcess of the $500 Product RecallDeductible. The Product RecallDeductibleapplies separately to each"covered recall". The limits of insurancewill not be reduced by the amount of thisdeductible. We may, or will if required by law, pay allor any part of any deductible amount, ifapplicable. Upon notice of our payment of a deductible amount, you shallpromptly reimburse us for the part of thedeductible amount we paid. The Product Recall Expense Limits ofInsurance apply separately to eachconsecutive annual period and to any remaining period of less than 12 months,starting with the beginning of the policyperiod shown in the Declarations, unless the policy period is extended after issuance foran additional period of less than 12 months.In that case, the additional period will be deemed part of the last preceding period forthe purposes of determining the Limits ofInsurance. d.The following is added to SECTION II -LIABILITY, E. Liability and Medical ExpenseGeneral Conditions, 2. Duties in the Event ofOccurrence, Offense, Claim or Suit: You must see to it that the following aredone in the event of an actual or anticipated"covered recall" that may result in "productrecall expense": (1)Give us prompt notice of any discoveryor notification that "your product" mustbe withdrawn or recalled. Include adescription of "your product" and thereason for the withdrawal or recall; (2)Cease any further release, shipment,consignment or any other method ofdistribution of like or similar productsuntil it has been determined that allsuch products are free from defects thatcould be a cause of loss under thisinsurance. e.For the purposs of this endorsement, thefollowing definitions are added to SECTIONII - LIABILITY, F. Liability and MedicalExpenses Definitions: 1."Covered recall" means a recall madenecessary because you or a governmentbody has determined that a known orsuspected defect, deficiency,inadequacy, or dangerous condition in"your product" has resulted or will resultin "bodily injury" or "property damage". 2."Product recall expense(s)" means: a.Necessary and reasonable expensesfor: (1)Communications, including radioor television announcements orprinted advertisements includingstationary, envelopes andpostage; 391-1006 08 16 Includes copyrighted materials of Insurance Services Offices, Inc., with its permission.Page 5 of 6 3ROLF\1XPEHU 2+$ OH3A431963 1001678 (2)Shipping the recalled productsfrom any purchaser, distributor oruser to the place or placesdesignated by you; (3)Remuneration paid to yourregular "employees" fornecessary overtime; (4)Hiring additional persons, otherthan your regular "employees"; (5)Expenses incurred by "employees"including transportation andaccommodations; (6)Expenses to rent additionalwarehouse or storage space; (7)Disposal of "your product", butonly to the extent that specificmethods of destruction other thanthose employed for trashdiscarding or disposal arerequired to avoid "bodily injury"or "property damage" as a resultof such disposal, you incur exclusively for the purposeof recalling "your product"; and b.Your lost profit resulting from such"covered recall". f.This Product Recall Expense Coverage doesnot apply: (1)If the "products - completed operationshazard" is excluded from coverage underthis Coverage Part including anyendorsement thereto; or (2)To "product recall expense" arising out ofany of "your products" that are otherwise excluded from coverage under thisCoverage Part including endorsementsthereto. 8. Unintentional Failure to Disclose Hazards The following is added to SECTION II -LIABILITY, E. Liability and Medical ExpensesGeneral Conditions: Representations We will not disclaim coverage under thisCoverage Part if you fail to disclose all hazardsexisting as of the inception date of the policyprovided such failure is not intentional. 9. Unintentional Failure to Notify The following is added to SECTION II -LIABILITY, E. Liability and Medical ExpensesGeneral Conditions, 2. Duties in the Event ofOccurrence, Offense, Claim or Suit: Your rights afforded under this Coverage Partshall not be prejudiced if you fail to give usnotice of an "occurrence", offense, claim or "suit",solely due to your reasonable and documentedbelief that the "bodily injury", "property damage"or "personal and advertising injury" is notcovered under this Policy. ALL OTHER TERMS, CONDITIONS, AND EXCLUSIONS REMAIN UNCHANGED. 391-1006 08 16 Includes copyrighted materials of Insurance Services Offices, Inc., with its permission.Page 6 of 6 3ROLF\1XPEHU 2+$ !&~Hanover ~ Jnsurance Group .. THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. ADDITIONAL INSURED - OWNERS, LESSEES OR CONTRACTORS - COMPLETED OPERATIONS This endorsement modifies insurance provided under the following: BUSINESSOWNERS COVERAGE FORM SCHEDULE 391-1602 08 16 Includes copyrighted material of Insurance Services Office, Inc., with its permission.Page 1 of 1 Name Of Person Or Organization Location And Description Of Completed Operations (If no entry appears above, information required to complete this endorsement will be shown in the Declarations as applicable to this endorsement.) For the purpose of coverage provided by this endorsement, the following changes are made to SECTION II - LIABILITY: A.The following is added to SECTION II -LIABILITY, C. Who Is An Insured: Any person or organization shown in theSchedule above is also an additional insured,but only with respect to liability for "bodilyinjury" or "property damage" caused, in wholeor in part, by "your work" at the locationdesignated and described in the Scheduleabove, performed for that additional insured andincluded in the "products-completed operationshazard". However: 1.The insurance afforded to such additionalinsured only applies to the extent permittedby law; and 2.If coverage provided to the additionalinsured is required by a contract or agreement, the insurance afforded to suchadditional insured will not be broader thanthat which you are required by the contractor agreement to provide for such additionalinsured. B.The following is added to SECTION II -LIABILITY, D. Liability And Medical ExpensesLimits Of Insurance: If coverage provided to the additional insured isrequired by a contract or agreement, the mostwe will pay on behalf of the additional insured isthe amount of insurance: 1.Required by the contract or agreement; or 2.Available under the applicable Limits ofInsurance shown in the Declarations; whichever is less. This endorsement shall not increase theapplicable Limits of Insurance shown in theDeclarations. ALL OTHER TERMS, CONDITIONS AND EXCLUSIONS REMAIN UNCHANGED. ANY PERSON OR ORGANIZATION AS REQUIRED BY CONTRACT 3ROLF\1XPEHU 2+$ OH3A431963 1001678 1. SECTION I - PROPERTY, if two or more ofthis coverage part's coverages apply tothe same loss or damage, we will not paymore than the actual amount of the loss ordamage. 2. SECTION II - LIABILITY, it is our statedintent that the various Coverage Parts, forms, endorsements or policies issued tothe named insured by us, or any companyaffiliated with us, do not provide any duplication or overlap of coverage for thesame claim, "suit", "occurrence", offense,accident, "wrongful act" or loss. We willnot pay more than the actual amount ofthe loss or damage. If this Coverage Part and any otherCoverage Part, form, endorsement orpolicy issued to the named insured by us,or any company affiliated with us, apply tothe same claim, "suit", occurrence,offense, accident, "wrongful act" or loss,the maximum Limit of Insurance under allsuch Coverage Parts, forms,endorsements or policies combined shallnot exceed the highest applicable Limit ofInsurance under any one Coverage Part,form, endorsement or policy. This condition does not apply to anyExcess or Umbrella Policy issued by usspecifically to apply as excess insuranceover this policy. G. Liberalization If we adopt any revision that would broadenthe coverage under this policy withoutadditional premium within 45 days prior to orduring the policy period, the broadenedcoverage will immediately apply to this policy. H. Other Insurance 1. SECTION I - PROPERTY If there is other insurance covering thesame loss or damage, we will pay only forthe amount of covered loss or damage inexcess of the amount due from that otherinsurance, whether you can collect on it ornot. But, we will not pay more than theapplicable Limit of Insurance of SECTION I- PROPERTY. 2. SECTION II - LIABILITY If other valid and collectible insurance isavailable to the insured for a loss wecover under SECTION II - LIABILITY, ourobligations are limited as follows: a. Primary Insurance This insurance is primary except whenparagraphb.below applies. If thisinsurance is primary, our obligationsare not affected unless any of theother insurance is also primary. Then,we will share with all that otherinsurance by the method described inparagraphc.below. However, if you agree in a writtencontract, written agreement, orwritten permit that the insuranceprovided to any person ororganization included as an Additional Insured under thisCoverage Part is primary andnon-contributory, we will not seek contribution from any otherinsurance available to that AdditionalInsured which covers the Additional Insured as a Named Insured except: (1)For the sole negligence of theAdditional Insured; or (2)When the Additional Insured isan Additional Insured underanotherliabilitypolicy. b. Excess Insurance This insurance is excess over: (1)Any of the other insurance,whether primary, excess,contingent or on any other basis: (a)That is Fire, ExtendedCoverage, Builder's Risk,Installation Risk or similarcoverage for "your work"; (b)That is Property Insurance forpremises rented to you ortemporarily occupied by youwith permission of the owner; (c)That is insurance purchasedby you to cover your liabilityas a tenant for "propertydamage" to premises rentedto you or temporarilyoccupied by you withpermission of the owner; or (d)If the loss arises out of themaintenance or use ofaircraft, "autos" or watercraftto the extent not subject toSECTION II - LIABILITY,Exclusion g. Aircraft, Auto orWatercraft; and (2)Any other primary insuranceavailable to you covering liabilityfor damages arising out of thepremises or operations, or theproducts and completedoperations, for which you havebeen added as an additionalinsured by attachment of anendorsement. When this insurance is excess, wewill have no duty under SECTION II -LIABILITY to defend the insuredagainst any "suit" if any otherinsurer has a duty to defend theinsured against that "suit". If no otherinsurer defends, we will undertake todo so, but we will be entitled to the 391-1003 08 16 Includes copyrighted material of Insurance Services Office, Inc., with its permission. Page 79 of 81 3ROLF\1XPEHU 2+$ !&~Hanover ~ Jnsurance Group .. premium in accordance with our rates andrules then in effect. 3.With our consent, you may continue thispolicy in force by paying a continuationpremium for each successive one-yearperiod. The premium must be: a.Paid to us prior to the anniversarydate; and b.Determined in accordance withparagraph 2. above. Our forms then in effect will apply. If youdo not pay the continuation premium, thispolicywill expire on the first anniversarydate that we have not received thepremium. 4.Undeclared exposures or change in yourbusiness operation, acquisition or use oflocations may occur during the policyperiod that is not shown in theDeclarations. If so, we may require anadditional premium. That premium will bedetermined in accordance with our ratesand rules then in effect. J. Premium Audit 1.This policy is subject to audit if a premiumdesignated as an advance premium isshown in the Declarations. We willcompute the final premium due when wedetermine your actual exposures. 2.Premium shown in this policy as advancepremium is a deposit premium only. At theclose of each audit period, we will compute the earned premium for thatperiod and send notice to the first NamedInsured. The due date for audit premiums is the date shown as the due date on thebill. If the sum of the advance and auditpremiums paid for the policy period isgreater than the earned premium, we willreturn the excess to the first NamedInsured. 3.The first Named Insured must keeprecords of the information we need forpremium computation and send us copiesat such times as we may request. K. Transfer of Rights of Recovery Against Othersto Us 1.Applicable to SECTION I - PROPERTYCoverage: If any person or organization to or forwhom we make payment under this policyhas rights to recover damages fromanother, those rights are transferred to usto the extent of our payment. That personor organization must do everythingnecessary to secure our rights and mustdo nothing after loss to impair them. Butyou may waive your rights against anotherparty in writing: insured's rights against all those otherinsurers. c.When this insurance is excess over otherinsurance, we will pay only our share ofthe amount of the loss, if any, thatexceeds the sum of: (1)The total amount that all such otherinsurance would pay for the loss inthe absence of this insurance; and (2)The total of all deductible andself-insured amounts under all thatother insurance. d.We will share the remaining loss, if any, with any other insurance that is notdescribed in this provision and was notbought specifically to apply in excess of the Limits of Insurance shown in theDeclarations for this Coverage. e. Method of Sharing If all of the other insurance permitscontribution by equal shares, we willfollow this method also. Under thisapproach each insurer contributes equalamounts until it has paid its applicableLimit of Insurance or none of the lossremains, whichever comes first. If any of the other insurance does notpermit contribution by equal shares, wewill contribute by limits. Under thismethod, each insurer's share is based onthe ratio of its applicable Limit ofInsurance to the total applicable limits ofinsurance of all insurers. f.When this insurance is excess, we willhave no duty under Business LiabilityCoverage to defend any claim or "suit"that any other insurer has a duty todefend. If no other insurer defends, wewillundertake to do so; but we will beentitled to the insured's rights against allthose other insurers. I. Premiums 1.The first Named Insured shown in theDeclarations: a.Is responsible for the payment of allpremiums; and b.Will be the payee for any returnpremiums we pay. 2.The premium shown in the Declarations wascomputed based on rates in effect at the timethe policy was issued. On each renewal,continuation or anniversary of the effectivedate of this policy, we will compute the 391-1003 08 16 Includes copyrighted material of Insurance Services Office, Inc., with its permission.Page 80 of 81 3ROLF\1XPEHU 2+$ OH3A431963 1001678 a.Prior to a loss to your CoveredProperty. b.After a loss to your Covered Propertyonly if, at time of loss, that party isone of the following: (1)Someone insured by thisinsurance; (2)A business firm: (a)Owned or controlled by you;or (b)That owns or controls you; or (3)Your tenant. You may also accept the usual bills of lading or shipping receipts limiting theliability of carriers. This will not restrict your insurance. 2.Applicable to SECTION II - LIABILITYCoverage: If the insured has rights to recover all orpart of any payment we have madeunder this Coverage Part, those rightsare transferred to us. The insured mustdo nothing after loss to impair suchrights. At our request, the insured willbring "suit" or transfer those rights to usand help us enforce them. We waive any right of recovery we mayhave against any person ororganization with whom you have awritten contract, permit or agreementto waive any rights of recovery againstsuch person or organization because ofpayments we make for injury ordamage arising out of your ongoingoperations or "your work" done under acontract with that person ororganization and included in the"products-completed operationshazard". This condition does not apply toMedical Expenses Coverage. L. Transfer of Your Rights and Duties UnderThis Policy Your rights and duties under this policymay not be transferred without our writtenconsent except in the case of death of anindividual Named Insured. If you die, yourrights and duties will be transferred to yourlegal representative but only while thatlegal representative is acting within thescope of their duties as your legalrepresentative. Until your legalrepresentative is appointed, anyone withproper temporary custody of your propertywill have your rights and duties but onlywith respect to that property. 391-1003 08 16 Includes copyrighted material of Insurance Services Office, Inc., with its permission.Page 81 of 81 3ROLF\1XPEHU 2+$ !&~Hanover ~ Jnsurance Group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r----------------11 cY-p>AL q~ 461-0500 11 13 Includes copyrighted material of Insurance Services Office, Inc., with its permission THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. WAIVER OF TRANSFER OF RIGHTS OF RECOVERY AGAINST OTHERS TO US (WAIVER OF SUBROGATION) This endorsement modifies insurance provided under the following: BUSINESS AUTO COVERAGE FORM BUSINESS AUTO PHYSICAL DAMAGE COVERAGE FORM GARAGE COVERAGE FORM MOTOR CARRIER COVERAGE FORM TRUCKERS COVERAGE FORM With respect to coverage provided by this endorsement, the provisions of the Coverage Form apply unless modified by the endorsement. This endorsement changes the policy effective on the inception date of the policy unless another date is indicated below. Named Insured:NBS GOVERNMENT FINANCE GROUP Endorsement Effective Date:09/24/2022 SCHEDULE Name(s) Of Person(s) Or Organization(s): ANY PERSON OR ORGANIZATION WHEN REQUIRED BY A WRITTEN CONTRACT Information required to complete this Schedule, if not shown above, will be shown in the Declarations The Transfer Of Rights Of Recovery Against Others To Us Condition does not apply to the person(s) or organization(s) shown in the Schedule, but only to the extent that subrogation is waived prior to the "accident" or the "loss" under a contract with that person or organization. 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Copyright, Insurance Services Office, Inc., 1996 461-0155 (9-97) THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. BUSINESS AUTO COVERAGE BROADENING ENDORSEMENT This endorsement modifies insurance provided under the following: BUSINESS AUTO COVERAGE FORM With respect to coverage provided by this endorsement, the provisions of the Coverage Form apply unless modified by the endorsement. 1.CANCELLATION EXTENSION Paragraph A. CANCELLATION 2. b. of the COMMON POLICY CONDITIONS is replaced with the following: b. 60 days before the effective date of cancellation if we cancel for any other reason. SECTION I - COVERED AUTOS 2.EMPLOYEE HIRED "AUTOS" Description Of Covered Auto Designation Symbols; Symbol 8 is replaced by the following: 8 = Hired "Autos" Only - Only those "autos" you lease, hire, rent or borrow; including "autos" your employee hires at your direction, for the purpose of conducting your business. This does not include any "auto" you lease, hire, rent, or borrow from any of your "employees" or partners or members of their households. SECTION II - LIABILITY COVERAGE 3.BROADENED NAMED INSURED The following is added to the SECTION II - LIABILITY COVERAGE, Paragraph 1. Who Is An Insured provision: d. Any business entity for which you have a financial interest greater than 50% of the voting stock or otherwise have a controlling interest after the effective date of this policy or that is newly acquired or formed by you during the term of this policy. The coverage provided by this provision is afforded until expiration or termination of this policy, whichever occurs earlier. The coverage provided by this provision does not apply to any business entity described in d. above that qualifies as an insured under any other automobile liability policy issued to that business entity as a named insured or would have been an insured except for the exhaustion of the policy limits or the insolvency of the insurer. The coverage provided by this provision does not apply to "bodily injury" nor "property damage" arising from an accident that occurred prior to your acquiring or forming the business entity described in d. above. 3ROLF\1XPEHU $+$ Includes copyrighted material of Insurance Services Office, Inc. with its permission. Copyright, Insurance Services Office, Inc., 1996 461-0155 (9-97) 4.EMPLOYEES AS INSUREDS The following is added to the SECTION II - LIABILITY COVERAGE, Paragraph 1. Who Is An Insured provision: e. Any employee of yours is an "insured" while using a covered "auto" you do not own, hire or borrow in your business or your personal affairs. 5.SUPPLEMENTARY PAYMENTS The following amends SECTION II - LIABILITY COVERAGE, Paragraph 2. Coverage Extensions provision: Paragraph (2) is replaced by the following: (2) Up to $2500 for cost of bail bonds (including bonds for related traffic law violations) required because of an "accident" we cover. We do not have to furnish these bonds. Paragraph (4) is replaced by the following: (4) All reasonable expenses incurred by the "insured" at our request, including actual loss of earnings up to $500 a day because of time off from work. 6.AMENDED FELLOW EMPLOYEE EXCLUSION The following is added to the SECTION II - LIABILITY COVERAGE, B. Exclusions Paragraph 5. Fellow Employee exclusion: This exclusion does not apply if the "bodily injury" arises from the use of a covered "auto" you own or hire. This coverage is excess over any other collectible insurance SECTION III - PHYSICAL DAMAGE COVERAGE. 7.EXPENSE OF RETURNING A STOLEN "AUTO"and SIGN COVERAGE The following is added to SECTION III - PHYSICAL DAMAGE COVERAGE,A.1. COVERAGE: d.Expense Of Returning A Stolen "Auto" We will pay for the expense of returning a covered "auto" to you. e.Sign Coverage We will pay for loss to signs, murals, paintings or graphics, as part of equipment, which are displayed on a covered "auto". The most we will pay for "loss" in any one "accident" is the lesser of: 1. The actual cash value of the property as of the time of the "loss"; or 2. The cost of repairing or replacing the damaged or stolen property with other property of like kind and quality; or 3. $2,000. 8.GLASS BREAKAGE DEDUCTIBLE The following is added to SECTION III- PHYSICAL DAMAGE COVERAGE A. COVERAGE paragraph 3. Glass Breakage - Hitting a Bird or Animal - Falling Objects or Missiles: Any deductible shown in the Declarations as applicable to the 3ROLF\1XPEHU $+$ Includes copyrighted material of Insurance Services Office, Inc. with its permission. Copyright, Insurance Services Office, Inc., 1996 461-0155 (9-97) covered "auto" will not apply to glass breakage if such glass is repaired, rather than replaced. 9.TRANSPORTATION EXPENSE Paragraph 4. Coverage Extension. of SECTION III - PHYSICAL DAMAGE COVERAGE, A. COVERAGE is replaced with the following: 4.Coverage Extension We will pay up to $50 per day to a maximum of $1500 for temporary transportation expense incurred by you because of the total theft of a covered "auto" of the private passenger type. We will pay only for those covered "autos" for which you carry either Comprehensive or Specified Causes of Loss Coverage. We will pay for temporary transportation expenses incurred during the period beginning 24 hours after the theft and ending, regardless of the policy’s expiration, when the covered "auto" is returned to use or we pay for its "loss". 10.HIRED AUTO PHYSICAL DAMAGE The following is added to SECTION III - PHYSICAL DAMAGE COVERAGE, A. COVERAGE: 5.Hired Auto Physical Damage If hired "autos" are covered "autos" for Liability Coverage and if Physical Damage Coverage of Comprehensive, Specified Causes of Loss, or Collision is provided under this Coverage Form for any "auto" you own, then the Physical Damage Coverage(s) provided is extended to "autos" you hire without a driver or your employee hires, without a driver, at your direction, for the purpose of conducting your business, for a period of 30 days or less, of like kind and use as the "autos" you own, subject to the following: The most we will pay for any one loss is the lesser of the following: a. $50,000 per accident, or b. cash value, or c. the cost of repair, minus the deductible equal to the lowest deductible applicable to any owned "auto" for that coverage. Any deductible shown in the Declarations does not apply to "loss" caused by fire or lightning. Subject to the limit and deductible stated above, we will provide coverage equal to the broadest coverage provided to any covered "auto" you own, that is applicable to the loss. If the loss arises from an accident for which you are legally liable and the lessor incurs an actual financial loss from that accident, we will cover the lessor’s actual financial loss of use of the hired "auto" for a period of up to seven consecutive days from the date of the accident, subject to a limit of $1,000 per accident. 11.AUDIO, VISUAL AND DATA ELECTRONIC EQUIPMENT COVERAGE The following is added to SECTION III - PHYSICAL DAMAGE COVERAGE, A. COVERAGE: 6.Audio, Visual and Data Electronic Equipment Coverage We will pay for "loss" to any electronic equipment that receives 3ROLF\1XPEHU $+$ Includes copyrighted material of Insurance Services Office, Inc. with its permission. Copyright, Insurance Services Office, Inc., 1996 461-0155 (9-97) or transmits audio, visual or data signals and that is not designed solely for the reproduction of sound. This coverage applies only if the equipment is permanently installed in the covered "auto" at the time of the "loss" or the equipment is removable from a housing unit which is permanently installed in the covered “auto’ at the time of the "loss", and such equipment is designed to be solely operated by use of the power from the "auto’s" electrical system, in or upon the covered "auto", including its antennas and other accessories. However , this does not include tapes, records or discs. The exclusions that apply to PHYSICAL DAMAGE COVERAGE, except for the exclusion relating to Audio, Visual and Data Electronic Equipment, also apply to coverage provided herein. In addition, the following exclusions apply: We will not pay , under this coverage, for either any electronic equipment or accessories used with such electronic equipment that is: 1. Necessary for the normal operation of the covered "auto" or the monitoring of the covered "auto’s" operating system; or 2. Both: a. An integral part of the same unit housing any sound reproducing equipment designed solely for the reproduction of sound if the sound reproducing equipment is permanently installed in the covered "auto", and b. Permanently installed in the opening of the dash or console normally used by the manufacturer for the installation of a radio. With respect to coverage herein, the LIMIT OF INSURANCE provision of PHYSICAL DAMAGE COVERAGE is replaced by the following: 1. The most we will pay for all "loss" to audio, visual or data electronic equipment and any accessories used with this equipment as a result of any one "accident" is the lesser of a. The actual cash value of the damaged or stolen property as of the time of the "loss"; or b. The cost of repairing or replacing the damaged or stolen property with other property of like kind and quality; or c. $500. 2. An adjustment for depreciation and physical condition will be made in determining actual cash value at the time of the "loss". 3. Deductibles applicable to PHYSICAL DAMAGE COVERAGE, do not apply to this Audio, Visual and Data Electronic Equipment Coverage. If there is other coverage provided by this policy for audio, visual and data electronic equipment, the coverage provided herein is 3ROLF\1XPEHU $+$ Includes copyrighted material of Insurance Services Office, Inc. with its permission. Copyright, Insurance Services Office, Inc., 1996 461-0155 (9-97) excess. However, you may elect to apply the limit or any portion thereof of coverage provided herein to pay any deductible that is applicable under the provisions of the other coverage. 12.RENTAL REIMBURSEMENT and MATERIAL TRANSFER EXPENSE The following is added to SECTION III - PHYSICAL DAMAGE COVERAGE, A. COVERAGE: 7.Rental Reimbursement and Material Transfer Expense This coverage provides only those Physical Damage Coverages where a premium is shown in the Declarations. It applies only to a covered "auto" described or designated to which the Physical Damage Coverages apply. We will pay for auto rental expenses and the expenses, incurred by you because of "loss" to a covered "auto", to remove and transfer your materials and equipment from the covered "auto" . Payment applies in addition to the otherwise applicable amount of each coverage you have on a covered "auto". No deductibles apply to this coverage. We will pay only for those auto rental expenses incurred during the policy period beginning 24 hours after the "loss" and ending, regardless of the policy’s expiration, with the lesser of the following number of days: 1. The number of days reasonably required to repair or replace the covered “auto". If “loss” is caused by theft, this number of days is added to the number of days it takes to locate the covered "auto" and transport it to a repair shop. 2. 60 days. Our payment is limited to the lesser of the following amounts: 1. Necessary and actual expenses incurred, including loss of use. 2. $3000. This auto rental expense coverage does not apply while there are spare or reserve "autos" available to you for your operations. If "loss" results from the total theft of a covered "auto" of the private passenger type, we will pay under this coverage only that amount of your rental reimbursement expenses which is not already provided for under the SECTION III - PHYSICAL DAMAGE COVERAGE, A. 4. Coverage Extension. 13.AIRBAG COVERAGE The following is added to SECTION III - PHYSICAL DAMAGE COVERAGE, B. Exclusions, paragraph 3. The portion of this exclusion relating to mechanical or electrical breakdown does not apply to the accidental discharge of an airbag. This coverage is excess of other collectible insurance or warranty. No deductible applies to this Airbag Coverage. 3ROLF\1XPEHU $+$ Includes copyrighted material of Insurance Services Office, Inc. with its permission. Copyright, Insurance Services Office, Inc., 1996 461-0155 (9-97) 14.AUTO LOAN PHYSICAL DAMAGE EXTENSION The following is added to SECTION III - PHYSICAL DAMAGE COVERAGE, C. Limit Of Insurance provision: When a "loss" results in a total loss to a covered auto you own for which a Loss Payee is designated in this policy, the most we will pay for "loss" in any one "accident" is the greater of: 1. The actual cash value of the damaged or stolen property as of the time of the "loss"; or 2. The outstanding balance of the initial loan, less any amounts for taxes, overdue payments, overdue payment charges, penalties, interest , any charges for early termination of the loan, costs for Credit Life Insurance, Health, Accident or Disability Insurance purchased with the loan, and carry-over balances from previous loans. 15.AUTO LEASE PHYSICAL DAMAGE EXTENSION The following is added to SECTION III - PHYSICAL DAMAGE COVERAGE,C. Limit Of Insurance provision: If, because of damage, destruction or theft of a covered "auto", which is a long-term leased "auto", the lease agreement between you and the lessor is terminated, "we" will pay the difference between the amount paid under paragraph C. LIMIT OF INSURANCE 1.or 2. and the amount due at the time of "loss" under the terms of the lease agreement applicable to the leased "auto" which you are required to pay: less any fees to dispose of the auto; any overdue payments; financial penalties imposed under a lease for excessive use, abnormal wear and tear or high mileage; security deposits not refunded by the lessor; cost for extended warranties, Credit Life Insurance, Health, Accident or Disability Insurance purchased with the loan; and carry over balances from previous leases. This coverage applies only to the initial lease for the covered "auto" which has not previously been leased. This coverage is excess over all other collectible insurance. SECTION IV - CONDITIONS 16.DUTIES IN THE EVENT OF ACCIDENT, CLAIM, SUIT OR LOSS The following is added to SECTION IV - BUSINESS AUTO CONDITIONS,A. Loss Conditions, 2. Duties In The Event Of Accident, Claim, Suit Or Loss: d. Knowledge of any "accident", claim, "suit" or "loss" will be deemed knowledge by you when notice of such "accident", claim, "suit" or "loss" has been received by: (1) You, if you are an individual; (2) Any partner or insurance manager if you are a partnership; or (3) An executive officer or insurance manager if you are a corporation. 17.BLANKET WAIVER OF SUBROGATION Paragraph 5. Transfer Of Rights Of Recovery Against Others To Us, SECTION IV - BUSINESS AUTO CONDITIONS, A. Loss Conditions is replaced by the following: 3ROLF\1XPEHU $+$ Includes copyrighted material of Insurance Services Office, Inc. with its permission. Copyright, Insurance Services Office, Inc., 1996 461-0155 (9-97) 5.Transfer Of Rights Of Recovery Against Others To Us If any person or organization to or for whom we make payment under this Coverage Form has rights to recover damages from another, which have not been waived through the execution of an "insured contract", written agreement, or permit, prior to the "accident" or "loss" giving rise to the payment, those rights to recover damages from another are transferred to us. That person or organization must do everything necessary to secure our rights and must do nothing after the "accident" or "loss" to impair them. 18.UNINTENTIONAL FAILURE TO DISCLOSE INFORMATION The following is added to SECTION IV BUSINESS AUTO CONDITIONS. B. General Conditions, paragraph 2. Concealment, Misrepresentation Or Fraud: Your unintentional error in disclosing, or failure to disclose, any material fact existing after the effective date of this Coverage Form shall not prejudice your rights under this Coverage Form. However, this provision does not affect our right to collect additional premium or exercise our right of cancellation or nonrenewal. 19.HIRED AUTO – WORLDWIDE COVERAGE The following is added to SECTION IV - Business Auto Conditions, B. General Conditions, paragraph 7.Policy Period, Coverage Territory provision: e. Outside the coverage territory described in a., b., c., and d. above for an "accident" or "loss" resulting from the use of a covered "auto" you hire, without a driver, or your employee hires without a driver, at your direction, for the purpose of conducting your business, for a period of 30 days or less, provided the suit is brought within The United States of America or its territories or possessions. SECTION V - DEFINITIONS 20.MENTAL ANGUISH Paragraph C. "Bodily injury", SECTION V - DEFINITIONS is replaced by the following: C. "Bodily injury" means bodily injury, sickness or disease sustained by a person including death or mental anguish resulting from any of these. 3ROLF\1XPEHU $+$ WC 00 03 13 (Ed. 4-84) Copyright 1983 National Council on Compensation Insurance. WAIVER OF OUR RIGHT TO RECOVER FROM OTHERS ENDORSEMENT We have the right to recover our payments from anyone liable for an injury covered by this policy. We will not enforce our right against the person or organization named in the Schedule. (This agreement applies only to the extent that you perform work under a written contract that requires you to obtain this agreement from us.) This agreement shall not operate directly or indirectly to benefit anyone not named in the Schedule. Schedule This endorsement changes the policy to which it is attached and is effective on the date issued unless otherwise stated. (The information below is required only when this endorsement is issued subsequent to preparation of the policy.) Endorsement Effective Policy No. Endorsement No. Insured Premium Insurance Company Countersigned by ____________________________________________ OR THIS ENDORSEMENT APPLIES AS A BLANKET WAIVER OF SUBROGATION FOR THOSE PARTIES HAVING A WRITTEN CONTRACT WITH THE POLICYHOLDER REQUIRING A WAIVER OF SUBROGATION FOR WORKERS COMPENSATION COVERAGE OF THE POLICYHOLDERS EMPLOYEES. :'$ 0DVVDFKXVHWWV%D\,QVXUDQFH&RPSDQ\