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21-100 First Amendment 12-09-211 FIRST AMENDMENT TO AGREEMENT 327 BETWEEN THE CITY OF CUPERTINO AND KAYUGA SOLUTION, INC. FOR WATER SYSTEM OPERATION FEASIBILITY STUDY UPDATE This First Amendment to Agreement 327 between the City of Cupertino and Kayuga Solution, Inc., for reference dated August 9, 2021, is by and between the City of Cupertino, a municipal corporation (hereinafter "City") and Kayuga Solution, Inc., a Corporation (“Contractor”) whose address is 28241 Crown Valley Pkwy, #F-216, Laguna Niguel, CA 92677, and is made with reference to the following: RECITALS: On August 9, 2021, Agreement 327 (“Agreement”) was entered into by and between City and Contractor for Water System Operation Feasibility Study Update. A. City and Contractor desire to modify the Agreement on the terms and conditions set forth herein. NOW, THEREFORE, it is mutually agreed by and between and undersigned parties as follows: 1. SERVICES: Paragraph 2 of the Agreement is modified to read as follows: Services. Contractor agrees to provide the services and perform the tasks (“Services”) set forth in detail in Scope of Services, attached here and incorporated as Exhibit A-1. Contractor further agrees to carry out its work in compliance with any applicable local, State, or Federal order regarding COVID-19. 2. Exhibit A of the Agreement is replaced with a new Exhibit A-1 attached hereto. 3. TERM: Paragraph 3.1 of the Agreement is modified to read as follows: Term. This agreement begins on the Effective Date and ends on June 30, 2022 (“Contract Time”), unless terminated earlier as provided herein. Contractor’s Services shall begin on the effective date and shall be completed by June 30, 2022. The City’s appropriate department head of the City Manager may extend the Contract Time through a written amendment to this Agreement, provided such extension does not include additional contract funds. Extensions requiring additional contract funds are subject to the City’s purchasing policy. 4. COMPENSATION: Paragraph 4.1 of the Agreement is modified to read as follows: Maximum Compensation. City will pay Contractor for satisfactory performance of the Service in an amount that will be based on actual costs but will be capped so as not to exceed $55,140.00 (“Contract Price”), based upon the scope of services in Exhibit A-1 and the budget and rates included in Exhibit C, Compensation attached and incorporated here. The maximum compensation includes all expenses and reimbursements and will 2 remain in place even if Contractor’s actual costs exceed the capped amount. No extra work of payment is permitted without prior written approval of the City. 5. Exhibit C of the Agreement is replaced with a new Exhibit C-1 attached hereto. 6. Except as expressly modified herein, all other terms and covenants set forth in the Agreement shall remain the same and shall be in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this modification of Agreement to be executed. CITY OF CUPERTINO By Title Date APPROVED AS TO FORM City Attorney ATTEST: City Clerk Date KAYUGA SOLUTION, INC. By Title Date EXPENDITURE DISTRIBUTION Item PO Number Amount Original Agreement 2022-144, expiration date 12/31/2021 $39,740.00 First Amendment Expiration Date 6/30/2022 $15,400.00 Total $55,140.00 President Dec 9, 2021 Christopher D. Jensen Dec 9, 2021 Acting Director of Public Works Dec 9, 2021 November 22, 2021 Roger Lee Assistant Director of Public Works City of Cupertino 10300 Torre Ave. Cupertino, CA 95014 Subject: Amendment – Water System Operation Feasibility Study Scope Dear Roger, Thank you for allowing Kayuga Solution (Kayuga) to support the City of Cupertino’s water system concession agreement renewal process. As part of this effort, the City requested that Kayuga evaluate the feasibility of operating the water system in-house. Kayuga researched the regulatory, equipment, facility, and staff resources needed to operate the water system in- house. In addition, alternative options for operation were evaluated and a business case evaluation considering the financial viability was performed. As the City progresses in the concession agreement renewal process, the City is requesting further assistance from Kayuga to ensure that the best option for the City is chosen. Kayuga’s proposed amendment to our original scope of work is provided below. The amendment will include the following work tasks: •Support City’s Request for Proposal (RFP) process ­ Develop maintenance plan for the City’s water system ­ Provide asset management definitions ­ Provide asset management plan scenario analyses ­ Incorporate offers of the proposals received to the water system operation feasibility study to provide a more well-defined benefit cost analysis ­ Reconcile asset management output and provide a mechanism for the City to continuously track asset health in the future ­ Other tasks requested by the City Schedule The Team will complete the proposed tasks above by the end of June 2022 or as directed by the City. Budget Kayuga’s cost of service for the above tasks is provided below. No on-site meetings are budgeted. All project meetings will be performed using web-based meeting platforms. 200$ 185$ 140$ 135$ Hours Cost Hours Cost Hours Cost Hours Cost 1 Support City's Request for Proposal Process 40 8,000$ 16 2,960$ 24 3,360$ 8 1,080$ 88 15,400$ TotalTaskDescription Colin Chung Iday Syachrani Tom Hanson Charisse Kimura Total Hours Exhibit A-1 We thank you for the opportunity to submit the attached proposal. If you have any questions or concerns, please contact me at 949-300-3903 or colin.chung@kayugasolution.com. Regards, Colin Chung, PhD President Kayuga Solution 28241 Crown Valley Parkway #F216 Laguna Niguel, CA 92677 August 2, 2021 Roger Lee Assistant Director of Public Works City of Cupertino 10300 Torre Ave. Cupertino, CA 95014 Subject: Proposal – Water System Operation Feasibility Study Update Dear Roger, Thank you for trusting Kayuga Solution (Kayuga) to update the City of Cupertino’s water system operation feasibility study. We understand the importance of this business decision. We will provide the necessary data and information for the City to make the best business decision. With the City’s 25-year concession agreement with the San Jose Water Company (SJWC) nearing completion, the City needs to make a decision to do one of the following: 1.Renew or find a new operator for the concession agreement 2.Take over the operations, maintenance, and management of the water system 3.Sell the City-owned water system As part of this effort, the City wishes to evaluate the feasibility of operating the water system in -house. In this project, the City wishes understand the resource, facility, equipment, and costs required to take on the water system operation. This will be important data needed for the City to make the best business decision at the end of the concession agreement. Kayu ga understands the City’s objectives. We will research the costs (e.g., direct, indirect, capital), highlight opportunities, and identify other constraints that must be considered to establish an in -house water system operation and maintenance team. In order to best serve the City, Kayuga will work with Hanson Associates (Hanson) who will provide local knowledge. Hanson will research the labor and operation costs. Our Team’s proposed scope of work is provided below. Work Approach / Scope of Service As a feasibility study, our work will involve not only identifying the cost of in-house operation but also the initial capital investment required to ensure reliable distribution of water services. The evaluation will need to take place considering multiple facets: •Costs - Initial setup costs (e.g., regulatory, equipment, labor, legal, operation plan, emergency response plan, recruiting, training, policy development) - On-going costs (e.g., labor, training, emergency response, certification, legal, master plan) - Opportunity costs (e.g., loss of revenue from the lease franchise fee) - CIP/asset replacement costs •Benefits Original Agreement EXHIBITS A & C –Revenue for the City •Culture Change - Integration of water department/division into the City’s existing organization structure - Transition plan discussion on how the new water department/division can be developed and be integrated into the City The Team will identify and describe the actions the City must take to assume responsibility for operating the water system in the leased area and estimate the cost and level of effort of those actions. The Team will consider only levels of effort that will allow the City-operated water system to meet likely permit requirements and AWWA standards. The following elements will be included: 1.One-time Costs to Establish a Water Department/Division The City will incur costs to establish a municipal water distribution system. The City will s et up a qualified work force and will supply them with the equipment and facilities needed to successfully operate the system . The City will simultaneously complete the Water Resources Control Board permit process to obtain an operator’s permit. The Team will identify these pre-operation activities, including the examples below, and the one-time costs associated: •Permit consulting fees •Permit cost •Recruiting and hiring •Computer systems and office equipment •Office design and setup •Maintenance equipment •Spare parts and replacement equipment inventory •Warehouse, shops, laydown yard and employee facilities Permit Application The leased area falls under the jurisdiction of District 17 of the Water Resources Board from whom the City must obtain a permit to assume operational control of its water system. The Team will identify all the steps of the permitting process and provide a full description of the activities and deliverables that the City must provide. Permit cost estimation and duration will also be provided. Personnel Using similar water systems as a comparison, the Team will identify the position types, certification, number required, and estimated salaries for the personnel needed to operate the distribution system; the City’s benefit’s overhead will be applied to salaries to show total personnel costs. Vacations, sick leave, and training allowances will be calculated to ensure adequate staffing for the system throughout the year. The Team will provide an organization chart for the water system and show how it would fit into Cupertino’s current organization and how the positions and salaries would fit into the City’s salary schedule. 2.Recurring Operation Costs The Team will identify recurring operating activities and the estimated annual costs. Contract services The City will incur contract service costs for activities where a contractor has expertise and experience, such as consultants to perform rate studies, Urban Water Management Plans, and similar services. If an election is required, ballot preparation, public notice, and educational materials might also be furnished by a consultant. Customer bill printing, mailing, and payment processing are extremely labor-intensive activities and might best be performed by an outside firm. Contractors also may supply services such as training, uniforms, office equ ipment maintenance, or equipment calibration. Original Agreement EXHIBITS A & C Operating Supplies and Utilities The water system will require a warehouse operation (combined or stand -alone) to maintain the optimum stock of spare parts for normal planned and corrective maintenance and rep lacement equipment for run-to-failure assets or single points of failure. Annual replenishment costs will by estimated by the Team. The initial inventory purchase will be estimated in One-time Costs along with a discussion of options for warehouse, yard, shop space, and employee facilities. If information is made available by San Jose Water Company, the team will use the local utility costs. If not available, utility cost will be estimated based on comparison water system’s experience. The water system will require office supplies, safety equipment, and operating materials. The Team will estimate the annual costs for water operations in this section. Interdepartmental Support The Team will confer with finance, IT, fleet maintenance, engineering, landscape ma intenance, and other City departments that must or may provide services to the water utility in lieu of direct utility employees. The utility will incu r costs from the finance department for budgeting, accounting, and reporting services and from fleet main tenance for vehicle repair and service. The water system may acquire services from engineering or landscape maintenance. The Team will confer with Cupertino finance and other officials to estimate the cost of interfund transfers. 3.Lost Revenue and Opportunity Cost The Team will examine the impact of the potential loss of revenue from the lease franchise fee and utility taxes on City operations. The City’s one-time investment to set up a City-operated distribution system will be identified and a repayment schedule will be developed so that the City can recover its capital and operational outlays to establish the water entity. 4.Water System Finances The Team will capture the personnel, operations, interdepartmental support costs, and recapture of one-time costs and will apply appropriate escalation to represent the expense budget over a 10 - and 20-year horizon. The Team will estimate operating and capital reserves required for proper operation of the water system over the planning horizon. In this analysis, the Team will re-evaluate and incorporate the projected asset replacement/refurbishment needs identified in the asset management plan. The Team will examine the income potential of the distribution system over the same horizon. The revenue examination will begin with historic water consumption, likely drought impacts, and the customer base including any projected increases or decreases to the customer base. The Team will identify current sales to each customer class, and meter charges and any surcharges will be estimated to establish gross water sales. The Team will assess the adequacy the rates to meet operating, capital, and reserve expenses. The Team will present scenarios at various rate levels and recommend a rate level and escalation mechanism that meets the system’s requirements. 5.Alternative Operation Options California cities are permitted to enter into agreements with private companies to operate water systems. There are two generally accepted categories into which these compacts fall. •Contracts usually have a 5-to-10-year contract term. The contractor’s fee is fixed for the term of the contract giving the City stability for financial planning. Beyond the fee, the City is responsible for funding any needed capital improvements which may be carried out by the contractor or others. •Concessions are arrangements whereby a private company operates the system, finances, and implements any required capital improvements for an agreed upon term, and then transfers the system back to the public partner at the end of the specified time. Original Agreement EXHIBITS A & C Another option is a long-term operating contract with a public agency which likely would operate similarly to the “contracts” above. The Team will explore the options above and compare the feasibility of each option. 6.Governmental Structure The Team will evaluate how the City can most efficiently integrate the water system into the City’s governmental and organizational structure. Can the oversight of the water system be assigned to an active commission, or would creation of a new utilities-focused commission best serve the Council’s governance of the water system? The Team will study how the water system can most effectively and economically be integrated into the City’s organizational structure. Can the water system be incorporated into an existing department with a deputy director to manage the function or will a stand -alone department with a director to oversee water operation better serve the rate payers? 7.Transition Period There is not much time until the end of the SJWC service contract. It will be very difficult for the City to be prepared for the operational transition considering the need for a full water distribution entity with staff, equipment, and facilities, as well as the need to meet all the Water Resources Control Board requirements to obtain the necessary permit. Alternative operating arrangements will be required to create a transition period that allows the City to hire qualified personnel, establish suitably equipped office, shop, and warehouse facilities. The transition period also provides time to complete the permit process in orderly fashion. The Team will explore three alternatives for interim system management and report on the feasibility and effectiveness of each of the following options: •Short term system lease renewal with current leasehold •Short term system lease to neighboring public water operator •Operation of the system by a third party (i.e., 5. Alternative Operation Options) Any additional costs related to these options will be detailed. 8.Information Sources The Team will rely on information from San Jose Water Company regarding revenue, staff time, maintenance efforts, spares and replacement parts, and electrical power costs. If such information is not available, the Team will utilize information for operations and capital costs from nearby water agencies of similar composit ion to the leased area. Further information will be obtained from agencies that contract with private entities to operate public utilities and from the companies that provide those services. The Team also will obtain information from the California Water Resources Board, the California Public Utilities Commission, and other regulatory agencies to identify the City’s obligations in a sale of the system or for direct or contractor system operation. The Team will describe the actions required, the probable costs and estimated time to complete for all options available to the City regarding disposition of the leased area water system. Schedule The Team will complete the water system operation feasibility study by the end of September or as directed by the City . The key deliverable dates will be as follows: •Draft report – September 17, 2021 •Final report – October 1, 2021 Original Agreement EXHIBITS A & C Budget The Team’s cost of service for the above tasks is provided below. No on-site meetings are budgeted. All project meetings will be performed using web-based meeting platforms. We have reviewed and accept the City’s professional service agreement. We are able to provide the City’s general and professional liability insurance requirements and accept the City’s Hold Harmless Indemnity requirement. We thank you for the opportunity to submit the attached proposal. If you have any questions or concerns, please contact me at 949-300-3903 or colin.chung@kayugasolution.com. Regards, Colin Chung, PhD President Kayuga Solution 28241 Crown Valley Parkway #F216 Laguna Niguel, CA 92677 Original Agreement EXHIBITS A & C Water System Operation Feasibility Study Update Page 1 of 9 Professional/Consulting Contracts /Version: August 2021 PROFESSIONAL/CONSULTING SERVICES AGREEMENT 1. PARTIES This Agreement is made by and between the City of Cupertino, a municipal corporation (“City”), and Kayuga Solution, Inc. (“Contractor”), a Corporation for Water System Operation Feasibility Study Update, and is effective on the last date signed below (“Effective Date”). 2. SERVICES Contractor agrees to provide the services and perform the tasks (“Services”) set forth in detail in Scope of Services, attached here and incorporated as Exhibit A. Contractor further agrees to carry out its work in compliance with any applicable local, State, or Federal order regarding COVID-19. 3. TIME OF PERFORMANCE 3.1 This Agreement begins on the Effective Date and ends on December 31, 2021 (“Contract Time”), unless terminated earlier as provided herein. Contractor’s Services shall begin on the effective date and shall be completed by December 31, 2021. The City’s appropriate department head or the City Manager may extend the Contract Time through a written amendment to this Agreement, provided such extension does not include additional contract funds. Extensions requiring additional contract funds are subject to the City’s purchasing policy. 3.2 Schedule of Performance. Contractor must deliver the Services in accordance with the Schedule of Performance, attached and incorporated here Exhibit B. 3.3 Time is of the essence for the performance of all the Services. Contractor must have sufficient time, resources, and qualified staff to deliver the Services on time. 4. COMPENSATION 4.1 Maximum Compensation. City will pay Contractor for satisfactory performance of the Services an amount that will based on actual costs but that will be capped so as not to exceed $39,740.00 (“Contract Price”), based upon the scope of services in Exhibit A and the budget and rates included in Exhibit C, Compensation attached and incorporated here. The maximum compensation includes all expenses and reimbursements and will remain in place even if Contractor’s actual costs exceed the capped amount. No extra work or payment is permitted without prior written approval of City. 4.2 Invoices and Payments. Monthly invoices must state a description of the deliverable completed and the amount due for the preceding month. Within thirty (30) days of completion of Services, Contractor must submit a requisition for final and complete payment of costs and pending Water System Operation Feasibility Study Update Page 2 of 9 Professional/Consulting Contracts /Version: August 2021 claims for City approval. Failure to timely submit a complete and accurate payment requisition relieves City of any further payment or other obligations under the Agreement. 5. INDEPENDENT CONTRACTOR 5.1 Status. Contractor is an independent contractor and not an employee, partner, or joint venture of City. Contractor is solely responsible for the means and methods of performing the Services and for the persons hired to work under this Agreement. Contractor is not entitled to health benefits, worker’s compensation, or other benefits from the City. 5.2 Contractor’s Qualifications. Contractor warrants on behalf of itself and its subcontractors that they have the qualifications and skills to perform the Services in a competent and professional manner and according to the highest standards and best practices in the industry. 5.3 Permits and Licenses. Contractor warrants on behalf of itself and its subcontractors that they are properly licensed, registered, and/or certified to perform the Services as required by law and have procured a City Business License, if required by the Cupertino Municipal Code. 5.4 Subcontractors. Only Contractor’s employees are authorized to work under this Agreement. Prior written approval from City is required for any subcontractor, and the terms and conditions of this Agreement will apply to any approved subcontractor. 5.5 Tools, Materials, and Equipment. Contractor will supply all tools, materials and equipment required to perform the Services under this Agreement. 5.6 Payment of Benefits and Taxes. Contractor is solely responsible for the payment of employment taxes incurred under this Agreement and any similar federal or state taxes. Contractor and any of its employees, agents, and subcontractors shall not have any claim under this Agreement or otherwise against City for seniority, vacation time, vacation pay, sick leave, p ersonal time off, overtime, health insurance, medical care, hospital care, insurance benefits, social security, disability, unemployment, workers compensation or employee benefits of any kind. Contractor shall be solely liable for and obligated to pay directly all applicable taxes, fees, contributions, or charges applicable to Contractor’s business including, but not limited to, federal and state income taxes. City shall have no obligation whatsoever to pay or withhold any taxes or benefits on behalf of Contractor. Should any court, arbitrator, or administrative authority, including but not limited to the California Public Employees Retirement System (PERS), the Internal Revenue Service or the State Employment Development Division, determine that Contractor, or any of its employees, agents, or subcontractors, is an employee for any purpose, then Contractor agrees to a reduction in amounts payable under this Agreement, or to promptly remint to City any payments due by the City as a result of such determination, so that the City’s total expenses under this Agreement are not greater than they would have been had the determination not been made. 6. PROPRIETARY/CONFIDENTIAL INFORMATION In performing this Agreement, Contractor may have access to private or confidential information owned or controlled by the City, which may contain proprietary or confidential details the disclosure of which to third parties may be damaging to City. Contractor shall hold in confidence all City information provided by City to Contractor and use it only to perform this Agreement. Water System Operation Feasibility Study Update Page 3 of 9 Professional/Consulting Contracts /Version: August 2021 Contractor shall exercise the same standard of care to protect City information as a reasonably prudent contractor would use to protect its own proprietary data. 7. OWNERSHIP OF MATERIALS 7.1 Property Rights. Any interest (including copyright interests) of Contractor in any product, memoranda, study, report, map, plan, drawing, specification, data, record, document, or other information or work, in any medium (collectively, “Work Product”), prepared by Contractor in connection with this Agreement will be the exclusive property of the City upon completion of the work to be performed hereunder or upon termination of this Agreement, to the extent requested by City. In any case, no Work Product shall be shown to any third-party without prior written approval of City. 7.2 Copyright. To the extent permitted by Title 17 of the U.S. Code, all Work Product arising out of this Agreement is considered “works for hire” and all copyrights to the Work Product will be the property of City. Alternatively, Contractor assigns to City all Work Product copyrights. Contractor may use copies of the Work Product for promotion only with City’s written approval. 7.3 Patents and Licenses. Contractor must pay royalties or license fees required for authorized use of any third party intellectual property, including but not limited to patented, trademarked, or copyrighted intellectual property if incorporated into the Services or Work Product of this Agreement. 7.4 Re-Use of Work Product. Unless prohibited by law and without waiving any rights, City may use or modify the Work Product of Contractor or its sub-contractors prepared or created under this Agreement, to execute or implement any of the following: (a) The original Services for which Contractor was hired; (b) Completion of the original Services by others; (c) Subsequent additions to the original Services; and/or (d) Other City projects. 7.5 Deliverables and Format. Contractor must provide electronic and hard copies of the Work Product, on recycled paper and copied on both sides, except for one single-sided original. 8. RECORDS Contractor must maintain complete and accurate accounting records relating to its performance in accordance with generally accepted accounting principles. The records must include detailed information of Contractor’s performance, benchmarks and deliverables, which must be available to City for review and audit. The records and supporting documents must be kept separa te from other records and must be maintained for four (4) years from the date of City’s final payment. 9. ASSIGNMENT Contractor shall not assign, sublease, hypothecate, or transfer this Agreement, or any interest Water System Operation Feasibility Study Update Page 4 of 9 Professional/Consulting Contracts /Version: August 2021 therein, directly or indirectly, by operation of law or otherwise, without prior written consent of City. Any attempt to do so will be null and void. Any changes related to the financial control or business nature of Contractor as a legal entity is considered an assignment of the Agreement and subject to City approval, which shall not be unreasonably withheld. Control means fifty percent (50%) or more of the voting power of the business entity. 10. PUBLICITY / SIGNS Any publicity generated by Contractor for the project under this Agreement, during the term of this Agreement and for one year thereafter, will reference the City’s contributions in making the project possible. The words “City of Cupertino” will be displayed in all pieces of publicity, including flyers, press releases, posters, brochures, public service announcements, interviews and newspaper articles. No signs may be posted, exhibited or displayed on or about City property, except signage required by law or this Contract, without prior written approval from the City. 11. INDEMNIFICATION 11.1 To the fullest extent allowed by law, and except for losses caused by the sole and active negligence or willful misconduct of City personnel, Contractor shall indemnify, defend and hold harmless City, its City Council, boards and commissions, officers, official s, employees, agents, servants, volunteers, and consultants (“Indemnitees”), through legal counsel acceptable to City, from and against any and all liability, damages, claims, actions, causes of action, demands, charges, losses, costs, and expenses (including attorney fees, legal costs, and expenses related to litigation and dispute resolution proceedings) of every nature, arising directly or indirectly from this Agreement or in any manner relating to any of the following: (a) Breach of contract, obligations, representations, or warranties; (b) Negligent or willful acts or omissions committed during performance of the Services; (c) Personal injury, property damage, or economic loss resulting from the work or performance of Contractor or its subcontractors or sub-subcontractors; (d) Unauthorized use or disclosure of City’s confidential and proprietary Information; (e) Claim of infringement or violation of a U.S. patent or copyright, trade secret, trademark, or service mark or other proprietary or intellectual property rights of any third party. 11.2 Contractor must pay the costs City incurs in enforcing this provision. Contractor must accept a tender of defense upon receiving notice from City of a third-party claim. At City’s request, Contractor will assist City in the defense of a claim, dispute, or lawsuit arising out of this Agreement. 11.3 Contractor’s duties under this section are not limited to the Contract Price, workers’ compensation payments, or the insurance or bond amounts required in the Agreement. Nothing in the Agreement shall be construed to give rise to an implied right of indemnity in favor of Contractor against City or any Indemnitee. 11.4. Contractor’s payments may be deducted or offset to cover any money the City lost due to a claim or counterclaim arising out of this Agreement, a purchase order, or other transaction. Water System Operation Feasibility Study Update Page 5 of 9 Professional/Consulting Contracts /Version: August 2021 11.5. Contractor agrees to obtain executed indemnity agreements with provisions identical to those set forth here in this Section 11 from each and every subcontractor, or any other person o r entity involved by, for, with, or on behalf of Contractor in the performance of this Agreement. Failure of City to monitor compliance with these requirements imposes no additional obligations on City and will in no way act as a waiver of any rights hereunder. 11.6. This Section 11 shall survive termination of the Agreement. 12. INSURANCE Contractor shall comply with the Insurance Requirements, attached and incorporated here as Exhibit D, and must maintain the insurance for the duration of the Agreement, or longer as required by City. City will not execute the Agreement until City approves receipt of satisfactory certificates of insurance and endorsements evidencing the type, amount, class of operations covered, and the effective and expiration dates of coverage. Failure to comply with this provision may result in City, at its sole discretion and without notice, purchasing insurance for Contractor and deducting the costs from Contractor’s compensation or terminating the Agreement. 13. COMPLIANCE WITH LAWS 13.1 General Laws. Contractor shall comply with all local, state, and federal laws and regulations applicable to this Agreement. Contractor will promptly notify City of changes in the law or other conditions that may affect the Project or Contractor’s ability to perform. Contractor is responsible for verifying the employment authorization of employees performing the Services, as required by the Immigration Reform and Control Act. 13.2 Labor Laws. Contractor shall comply with all labor laws applicable to this Agreement. If the Scope of Services includes a “public works” component, Contractor is required to comply with prevailing wage laws under Labor Code Section 1720 and other labor laws. 13.3 Discrimination Laws. Contractor shall not discriminate on the basis of race, religious creed, color, ancestry, national origin, ethnicity, handicap, disability, marital status, pregnancy, age, sex, gender, sexual orientation, gender identity, Acquired-Immune Deficiency Syndrome (AIDS), or any other protected classification. Contractor shall comply with all anti-discrimination laws, including Government Code Sections 12900 and 11135, and Labor Code Sections 1735, 1777, and 3077.5. Consistent with City policy prohibiting harassment and discrimination, Contractor understands that harassment and discrimination directed toward a job applicant, an employee, a City employee, or any other person, by Contractor or its employees or sub-contractors will not be tolerated. Contractor agrees to provide records and documentation to the City on request necessary to monitor compliance with this provision. 13.4 Conflicts of Interest. Contractor shall comply with all conflict of interest laws applicable to this Agreement and must avoid any conflict of interest. Contractor warrants that no public official, employee, or member of a City board or commission who might have been involved in the making of this Agreement, has or will receive a direct or indirect financial interest in this Agreement, in violation of California Government Code Section 1090 et seq. Contractor may be required to file a conflict of interest form if Contractor makes certain governmental decisions or serves in a staff capacity, as defined in Section 18700 of Title 2 of the California Code of Water System Operation Feasibility Study Update Page 6 of 9 Professional/Consulting Contracts /Version: August 2021 Regulations. Contractor agrees to abide by the City’s rules governing gifts to public officials and employees. 13.5 Remedies. Any violation of Section 13 constitutes a material breach and may result in City suspending payments, requiring reimbursements or terminating this Agreement. City reserves all other rights and remedies available under the law and this Agreement, including the right to seek indemnification under Section 11 of this Agreement. 14. PROJECT COORDINATION City Project Manager. The City assigns Roger Lee as the City’s representative for all purposes under this Agreement, with authority to oversee the progress and performance of the Scope of Services. City reserves the right to substitute another Project manager at any time, and without prior notice to Contractor. Contractor Project Manager. Subject to City approval, Contractor assigns Colin Chung as its single Representative for all purposes under this Agreement, with authority to oversee the progress and performance of the Scope of Services. Contractor’s Project manager is responsible for coordinating and scheduling the Services in accordance with the Scope of Services and the Schedule of Performance. Contractor must regularly update the City’s Project Manager about the progress with the work or any delays, as required under the Scope of Services. City written approval is required prior to substituting a new Representative. 15. ABANDONMENT OF PROJECT City may abandon or postpone the Project or parts therefor at any time. Contractor will be compensated for satisfactory Services performed through the date of abandonment, and will be given reasonable time to assemble the work and close out the Services. With City’s pre-approval in writing, the time spent in closing out the Services will be compensated up to a maximum of ten percent (10%) of the total time expended to date in the performance of the Services. 16. TERMINATION City may terminate this Agreement for cause or without cause at any time. Contractor will be paid for satisfactory Services rendered through the date of termination, but final payment will not be made until Contractor closes out the Services and delivers the Work Product. 17. GOVERNING LAW, VENUE, AND DISPUTE RESOLUTION This Agreement is governed by the laws of the State of California. Any lawsuits filed related to this Agreement must be filed with the Superior Court for the County of Santa Clara, State of California. Contractor must comply with the claims filing requirements under the Government Code prior to filing a civil action in court. If a dispute arises, Contractor must continue to provide the Services pending resolution of the dispute. If the Parties elect arbitration, the arbitrator’s award must be supported by law and substantial evidence and include detailed written findings of law and fact. Water System Operation Feasibility Study Update Page 7 of 9 Professional/Consulting Contracts /Version: August 2021 18. ATTORNEY FEES If City initiates legal action, files a complaint or cross-complaint, or pursues arbitration, appeal, or other proceedings to enforce its rights or a judgment in connection with this Agreement, the prevailing party will be entitled to reasonable attorney fees and costs. 19. THIRD PARTY BENEFICIARIES There are no intended third party beneficiaries of this Agreement. 20. WAIVER Neither acceptance of the Services nor payment thereof shall constitute a waiver of any contract provision. City’s waiver of a breach shall not constitute waiver of another provision or breach. 21. ENTIRE AGREEMENT This Agreement represents the full and complete understanding of every kind or nature between the Parties, and supersedes any other agreement(s) and understanding(s), either oral or written, between the Parties. Any modification of this Agreement will be effective only if i n writing and signed by each Party’s authorized representative. No verbal agreement or implied covenant will be valid to amend or abridge this Agreement. If there is any inconsistency between any term, clause, or provision of the main Agreement and any term, clause, or provision of the attachments or exhibits thereto, the terms of the main Agreement shall prevail and be controlling. 22. INSERTED PROVISIONS Each provision and clause required by law for this Agreement is deemed to be included and will be inferred herein. Either party may request an amendment to cure mistaken insertions or omissions of required provisions. The Parties will collaborate to implement this Section, as appropriate. 23. HEADINGS The headings in this Agreement are for convenience only, are not a part of the Agreement and in no way affect, limit, or amplify the terms or provisions of this Agreement. 24. SEVERABILITY/PARTIAL INVALIDITY If any term or provision of this Agreement, or their application to a particular situation, is found by the court to be void, invalid, illegal, or unenforceable, such term or provision shall remain in force and effect to the extent allowed by such ruling. All other terms and provisions of this Agreement or their application to specific situations shall remain in full force and effect. The Parties agree to work in good faith to amend this Agreement to carry out its intent. Water System Operation Feasibility Study Update Page 8 of 9 Professional/Consulting Contracts /Version: August 2021 25. SURVIVAL All provisions which by their nature must continue after the Agreement expires or is terminated, including the Indemnification, Ownership of Materials/Work Product, Records, Governing Law, and Attorney Fees, shall survive the Agreement and remain in full force and effect. 26. NOTICES All notices, requests and approvals must be sent in writing to the persons below, which will be considered effective on the date of personal delivery or the date confirmed by a reputable overnight delivery service, on the fifth calendar day after deposit in the United States Mail, postage prepaid, registered or certified, or the next business day following electronic submission: To City of Cupertino Office of the City Manager 10300 Torre Ave. Cupertino CA, 95014 Attention: Roger Lee Email: rogerl@cupertino.org To Contractor: Kayuga Solution, Inc. 9641 Irvine Center Dr. Irvine CA 92618 Attention: Colin Chung Email: colin.chung@kayugasolution.com 27. EXECUTION The person executing this Agreement on behalf of Contractor represents and warrants that Contractor has full right, power, and authority to enter into and carry out all actions contemplated by this Agreement and that he or she is authorized to execute this Agreement, which constitutes a legally binding obligation of Contractor. This Agreement may be executed in counterparts, each one of which is deemed an original and all of which, taken together, constitute a single binding instrument. IN WITNESS WHEREOF, the parties have caused the Agreement to be executed. CITY OF CUPERTINO CONTRACTOR A Municipal Corporation By By Name Name Title Title Date Date Colin Chung President Aug 9, 2021 Colin Chung Aug 9, 2021 Director of Public Works Roger Lee Water System Operation Feasibility Study Update Page 9 of 9 Professional/Consulting Contracts /Version: August 2021 APPROVED AS TO FORM: CHRISTOPHER D. JENSEN Cupertino City Attorney ATTEST: KIRSTEN SQUARCIA City Clerk Date Christopher D. Jensen Aug 9, 2021 August 2, 2021 Roger Lee Assistant Director of Public Works City of Cupertino 10300 Torre Ave. Cupertino, CA 95014 Subject: Proposal – Water System Operation Feasibility Study Update Dear Roger, Thank you for trusting Kayuga Solution (Kayuga) to update the City of Cupertino’s water system operation feasibility study. We understand the importance of this business decision. We will provide the necessary data and information for the City to make the best business decision. With the City’s 25-year concession agreement with the San Jose Water Company (SJWC) nearing completion, the City needs to make a decision to do one of the following: 1.Renew or find a new operator for the concession agreement 2.Take over the operations, maintenance, and management of the water system 3.Sell the City-owned water system As part of this effort, the City wishes to evaluate the feasibility of operating the water system in -house. In this project, the City wishes understand the resource, facility, equipment, and costs required to take on the water system operation. This will be important data needed for the City to make the best business decision at the end of the concession agreement. Kayu ga understands the City’s objectives. We will research the costs (e.g., direct, indirect, capital), highlight opportunities, and identify other constraints that must be considered to establish an in -house water system operation and maintenance team. In order to best serve the City, Kayuga will work with Hanson Associates (Hanson) who will provide local knowledge. Hanson will research the labor and operation costs. Our Team’s proposed scope of work is provided below. Work Approach / Scope of Service As a feasibility study, our work will involve not only identifying the cost of in-house operation but also the initial capital investment required to ensure reliable distribution of water services. The evaluation will need to take place considering multiple facets: •Costs - Initial setup costs (e.g., regulatory, equipment, labor, legal, operation plan, emergency response plan, recruiting, training, policy development) - On-going costs (e.g., labor, training, emergency response, certification, legal, master plan) - Opportunity costs (e.g., loss of revenue from the lease franchise fee) - CIP/asset replacement costs •Benefits EXHIBITS A & C –Revenue for the City •Culture Change - Integration of water department/division into the City’s existing organization structure - Transition plan discussion on how the new water department/division can be developed and be integrated into the City The Team will identify and describe the actions the City must take to assume responsibility for operating the water system in the leased area and estimate the cost and level of effort of those actions. The Team will consider only levels of effort that will allow the City-operated water system to meet likely permit requirements and AWWA standards. The following elements will be included: 1.One-time Costs to Establish a Water Department/Division The City will incur costs to establish a municipal water distribution system. The City will s et up a qualified work force and will supply them with the equipment and facilities needed to successfully operate the system . The City will simultaneously complete the Water Resources Control Board permit process to obtain an operator’s permit. The Team will identify these pre-operation activities, including the examples below, and the one-time costs associated: •Permit consulting fees •Permit cost •Recruiting and hiring •Computer systems and office equipment •Office design and setup •Maintenance equipment •Spare parts and replacement equipment inventory •Warehouse, shops, laydown yard and employee facilities Permit Application The leased area falls under the jurisdiction of District 17 of the Water Resources Board from whom the City must obtain a permit to assume operational control of its water system. The Team will identify all the steps of the permitting process and provide a full description of the activities and deliverables that the City must provide. Permit cost estimation and duration will also be provided. Personnel Using similar water systems as a comparison, the Team will identify the position types, certification, number required, and estimated salaries for the personnel needed to operate the distribution system; the City’s benefit’s overhead will be applied to salaries to show total personnel costs. Vacations, sick leave, and training allowances will be calculated to ensure adequate staffing for the system throughout the year. The Team will provide an organization chart for the water system and show how it would fit into Cupertino’s current organization and how the positions and salaries would fit into the City’s salary schedule. 2.Recurring Operation Costs The Team will identify recurring operating activities and the estimated annual costs. Contract services The City will incur contract service costs for activities where a contractor has expertise and experience, such as consultants to perform rate studies, Urban Water Management Plans, and similar services. If an election is required, ballot preparation, public notice, and educational materials might also be furnished by a consultant. Customer bill printing, mailing, and payment processing are extremely labor-intensive activities and might best be performed by an outside firm. Contractors also may supply services such as training, uniforms, office equ ipment maintenance, or equipment calibration. EXHIBITS A & C Operating Supplies and Utilities The water system will require a warehouse operation (combined or stand -alone) to maintain the optimum stock of spare parts for normal planned and corrective maintenance and rep lacement equipment for run-to-failure assets or single points of failure. Annual replenishment costs will by estimated by the Team. The initial inventory purchase will be estimated in One-time Costs along with a discussion of options for warehouse, yard, shop space, and employee facilities. If information is made available by San Jose Water Company, the team will use the local utility costs. If not available, utility cost will be estimated based on comparison water system’s experience. The water system will require office supplies, safety equipment, and operating materials. The Team will estimate the annual costs for water operations in this section. Interdepartmental Support The Team will confer with finance, IT, fleet maintenance, engineering, landscape ma intenance, and other City departments that must or may provide services to the water utility in lieu of direct utility employees. The utility will incu r costs from the finance department for budgeting, accounting, and reporting services and from fleet main tenance for vehicle repair and service. The water system may acquire services from engineering or landscape maintenance. The Team will confer with Cupertino finance and other officials to estimate the cost of interfund transfers. 3.Lost Revenue and Opportunity Cost The Team will examine the impact of the potential loss of revenue from the lease franchise fee and utility taxes on City operations. The City’s one-time investment to set up a City-operated distribution system will be identified and a repayment schedule will be developed so that the City can recover its capital and operational outlays to establish the water entity. 4.Water System Finances The Team will capture the personnel, operations, interdepartmental support costs, and recapture of one-time costs and will apply appropriate escalation to represent the expense budget over a 10 - and 20-year horizon. The Team will estimate operating and capital reserves required for proper operation of the water system over the planning horizon. In this analysis, the Team will re-evaluate and incorporate the projected asset replacement/refurbishment needs identified in the asset management plan. The Team will examine the income potential of the distribution system over the same horizon. The revenue examination will begin with historic water consumption, likely drought impacts, and the customer base including any projected increases or decreases to the customer base. The Team will identify current sales to each customer class, and meter charges and any surcharges will be estimated to establish gross water sales. The Team will assess the adequacy the rates to meet operating, capital, and reserve expenses. The Team will present scenarios at various rate levels and recommend a rate level and escalation mechanism that meets the system’s requirements. 5.Alternative Operation Options California cities are permitted to enter into agreements with private companies to operate water systems. There are two generally accepted categories into which these compacts fall. •Contracts usually have a 5-to-10-year contract term. The contractor’s fee is fixed for the term of the contract giving the City stability for financial planning. Beyond the fee, the City is responsible for funding any needed capital improvements which may be carried out by the contractor or others. •Concessions are arrangements whereby a private company operates the system, finances, and implements any required capital improvements for an agreed upon term, and then transfers the system back to the public partner at the end of the specified time. EXHIBITS A & C Another option is a long-term operating contract with a public agency which likely would operate similarly to the “contracts” above. The Team will explore the options above and compare the feasibility of each option. 6.Governmental Structure The Team will evaluate how the City can most efficiently integrate the water system into the City’s governmental and organizational structure. Can the oversight of the water system be assigned to an active commission, or would creation of a new utilities-focused commission best serve the Council’s governance of the water system? The Team will study how the water system can most effectively and economically be integrated into the City’s organizational structure. Can the water system be incorporated into an existing department with a deputy director to manage the function or will a stand -alone department with a director to oversee water operation better serve the rate payers? 7.Transition Period There is not much time until the end of the SJWC service contract. It will be very difficult for the City to be prepared for the operational transition considering the need for a full water distribution entity with staff, equipment, and facilities, as well as the need to meet all the Water Resources Control Board requirements to obtain the necessary permit. Alternative operating arrangements will be required to create a transition period that allows the City to hire qualified personnel, establish suitably equipped office, shop, and warehouse facilities. The transition period also provides time to complete the permit process in orderly fashion. The Team will explore three alternatives for interim system management and report on the feasibility and effectiveness of each of the following options: •Short term system lease renewal with current leasehold •Short term system lease to neighboring public water operator •Operation of the system by a third party (i.e., 5. Alternative Operation Options) Any additional costs related to these options will be detailed. 8.Information Sources The Team will rely on information from San Jose Water Company regarding revenue, staff time, maintenance efforts, spares and replacement parts, and electrical power costs. If such information is not available, the Team will utilize information for operations and capital costs from nearby water agencies of similar composit ion to the leased area. Further information will be obtained from agencies that contract with private entities to operate public utilities and from the companies that provide those services. The Team also will obtain information from the California Water Resources Board, the California Public Utilities Commission, and other regulatory agencies to identify the City’s obligations in a sale of the system or for direct or contractor system operation. The Team will describe the actions required, the probable costs and estimated time to complete for all options available to the City regarding disposition of the leased area water system. Schedule The Team will complete the water system operation feasibility study by the end of September or as directed by the City . The key deliverable dates will be as follows: •Draft report – September 17, 2021 •Final report – October 1, 2021 EXHIBITS A & C Budget The Team’s cost of service for the above tasks is provided below. No on-site meetings are budgeted. All project meetings will be performed using web-based meeting platforms. We have reviewed and accept the City’s professional service agreement. We are able to provide the City’s general and professional liability insurance requirements and accept the City’s Hold Harmless Indemnity requirement. We thank you for the opportunity to submit the attached proposal. If you have any questions or concerns, please contact me at 949-300-3903 or colin.chung@kayugasolution.com. Regards, Colin Chung, PhD President Kayuga Solution 28241 Crown Valley Parkway #F216 Laguna Niguel, CA 92677 EXHIBITS A & C EXHIBIT B SCHEDULE OF PERFORMANCE TASK DATE Draft Report September 17, 2021 Final Report October 1, 2021 Exh. D-Insurance Requirements for Design Professionals & Consultant Contracts 1 Form Updated Sept. 2019 Consultant shall procure prior to commencement of Services and maintain for the duration of the contract, at its own cost and expense, the following insurance policies and coverage with companies doing business in California and acceptable to City. INSURANCE POLICIES AND MINIMUMS REQUIRED 1. Commercial General Liability (CGL) for bodily injury, property damage, personal injury liability for premises operations, products and completed operations, contractual liability, and personal and advertising injury with limits no less than $2,000,000 per occurrence (ISO Form CG 00 01). If a general aggregate limit applies, either the general aggregate limit shall apply separately to this project/location (ISO Form CG 25 03 or 25 04) or it shall be twice the required occurrence limit. a. It shall be a requirement that any available insurance proceeds broader than or in excess of the specified minimum insurance coverage requirements and/or limits shall be made available to the Additional Insured and shall be (i) the minimum coverage/limits specified in this agreement; or (ii) the broader coverage and maximum limits of coverage of any insurance policy, whichever is greater. b. Additional Insured coverage under Consultant's policy shall be "primary and non-contributory," will not seek contribution from City’s insurance/self-insurance, and shall be at least as broad as ISO Form CG 20 10 (04/13). c. The limits of insurance required may be satisfied by a combination of primary and umbrella or excess insurance, provided each policy complies with the requirements set forth in this Contract. Any umbrella or excess insurance shall contain or be endorsed to contain a provision that such coverage shall also apply on a primary basis for the benefit of City before the City’s own insurance or self- insurance shall be called upon to protect City as a named insured. 2. Automobile Liability: ISO CA 00 01 covering any auto (including owned, hired, and non-owned autos) with limits no less than $1,000,000 per accident for bodily injury and property damage. 3. Workers’ Compensation: As required by the State of California, with Statutory Limits and Employer’s Liability Insurance of no less than $1,000,000 per occurrence for bodily injury or disease.  Not required. Consultant has provided written verification of no employees. 4. Professional Liability for professional acts, errors and omissions, as appropriate to Consultant’s profession, with limits no less than $2,000,000 per occurrence or $2,000,000 aggregate. If written on a claims made form: a. The Retroactive Date must be shown and must be before the Effective Date of the Contract. b. Insurance must be maintained for at least five (5) years after completion of the Services. c. If coverage is canceled or non-renewed, and not replaced with another claims-made policy form with a Retroactive Date prior to the Contract Effective Date, the Consultant must purchase “extended reporting” coverage for a minimum of five (5) years after completion of the Services. EXHIBIT D Insurance Requirements Design Professionals & Consultants Contracts Exh. D-Insurance Requirements for Design Professionals & Consultant Contracts 2 Form Updated Sept. 2019 OTHER INSURANCE PROVISIONS The aforementioned insurance shall be endorsed and have all the following conditions and provisions: Additional Insured Status The City of Cupertino, its City Council, officers, officials, employees, agents, servants and volunteers (“Additional Insureds”) are to be covered as additional insureds on Consultant’s CGL and automobile liability policies. General Liability coverage can be provided in the form of an endorsement to Consultant’s insurance (at least as broad as ISO Form CG 20 10 (11/ 85) or both CG 20 10 and CG 20 37 forms, if later editions are used). Primary Coverage Coverage afforded to City/Additional Insureds shall be primary insurance. Any insurance or self-insurance maintained by City, its officers, officials, employees, or volunteers shall be excess of Consultant’s insurance and shall not contribute to it. Notice of Cancellation Each insurance policy shall state that coverage shall not be canceled or allowed to expire, except with written notice to City 30 days in advance or 10 days in advance if due to non-payment of premiums. Waiver of Subrogation Consultant waives any right to subrogation against City/Additional Insureds for recovery of damages to the extent said losses are covered by the insurance policies required herein. Specifically, the Workers’ Compensation policy shall be endorsed with a waiver of subrogation in favor of City for all work performed by Consultant, its employees, agents and subconsultants. This provision applies regardless of whether or not the City has received a waiver of subrogation endorsement from the insurer. Deductibles and Self-Insured Retentions Any deductible or self-insured retention must be declared to and approved by the City. At City’s option, either: the insurer must reduce or eliminate the deductible or self-insured retentions as respects the City/Additional Insureds; or Consultant must show proof of ability to pay losses and costs related investigations, claim administration and defense expenses. The policy shall provide, or be endorsed to provide, that the self-insured retention may be satisfied by either the insured or the City. Acceptability of Insurers Insurers must be licensed to do business in California with an A.M. Best Rating of A-VII, or better. Verification of Coverage Consultant must furnish acceptable insurance certificates and mandatory endorsements (or copies of the policies effecting the coverage required by this Contract), and a copy of the Declarations and Endorsement Page of the CGL policy listing all policy endorsements prior to commencement of the Contract. City retains the right to demand verification of compliance at any time during the Contract term. Subconsultants Consultant shall require and verify that all subconsultants maintain insurance that meet the requirements of this Contract, including naming the City as an additional insured on subconsultant’s insurance policies. Higher Insurance Limits If Consultant maintains broader coverage and/or higher limits than the minimums shown above, City shall be entitled to coverage for the higher insurance limits maintained by Consultant. Adequacy of Coverage City reserves the right to modify these insurance requirements/coverage based on the nature of the risk, prior experience, insurer or other special circumstances, with not less than ninety (90) days prior written notice. 08/02/2021 Cornerstone Specialty Insurance Services, Inc. 14252 Culver Drive, A299 Irvine CA 92604 Aimee Guesno (714)731-7700 (714)731-7750 aimee@cornerstonespecialty.com KAYUGA SOLUTION, INC. 28241 Crown Valley Parkway #F-216 Laguna Niguel CA 92677 RLI Insurance Company 13056 Gemini Insurance Company 21/22 COVERAGES A ADDT'L INSURED / PRIMARY BLNKT WVR OF SUBRO PSB0005208 03/03/2021 03/03/2022 2,000,000 1,000,000 10,000 INCLUDED 4,000,000 4,000,000 A PSA0002229 03/03/2021 03/03/2022 1,000,000 Medical payments 5,000 A 0 PSE0002867 03/03/2021 03/03/2022 1,000,000 1,000,000 A N PSW0003014 03/03/2021 03/03/2022 1,000,000 1,000,000 1,000,000 B Professional Liability Claims Made VNPL007303 03/03/2021 03/03/2022 Each Claim $1,000,000 Annual Aggregate $2,000,000 Certificate Holder is Additional Insured for General Liability but only if required by written contract with the Named Insured prior to an occurrence and as per attached endorsement. Coverage is subject to all policy terms and conditions. *30 days notice of cancellation, except for 10 days notice for non-payment of premium. For Professional Liability coverage, the aggregate limit is the total insurance available for all covered claims reported within the policy period. City of Cupertino 10300 Torre Ave. Cupertino CA 95014 SHOULD ANY OF THE ABOVE DESCRIBED POLICIES BE CANCELLED BEFORE THE EXPIRATION DATE THEREOF, NOTICE WILL BE DELIVERED IN ACCORDANCE WITH THE POLICY PROVISIONS. INSURER(S) AFFORDING COVERAGE INSURER F : INSURER E : INSURER D : INSURER C : INSURER B : INSURER A : NAIC # NAME:CONTACT (A/C, No):FAX E-MAILADDRESS: PRODUCER (A/C, No, Ext):PHONE INSURED REVISION NUMBER:CERTIFICATE NUMBER:COVERAGES 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 on this certificate does not confer rights to the certificate holder in lieu of such endorsement(s). THIS CERTIFICATE IS ISSUED AS A MATTER OF INFORMATION ONLY AND CONFERS NO RIGHTS UPON THE CERTIFICATE HOLDER. THIS CERTIFICATE DOES NOT AFFIRMATIVELY OR NEGATIVELY AMEND, EXTEND OR ALTER THE COVERAGE AFFORDED BY THE POLICIES BELOW. THIS CERTIFICATE OF INSURANCE DOES NOT CONSTITUTE A CONTRACT BETWEEN THE ISSUING INSURER(S), AUTHORIZED REPRESENTATIVE OR PRODUCER, AND THE CERTIFICATE HOLDER. OTHER: (Per accident) (Ea accident) $ $ N / A SUBR WVD ADDL INSD 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. $ $ $ $PROPERTY DAMAGE BODILY INJURY (Per accident) BODILY INJURY (Per person) COMBINED SINGLE LIMIT AUTOS ONLY AUTOSAUTOS ONLY NON-OWNED SCHEDULEDOWNED ANY AUTO AUTOMOBILE LIABILITY Y / N WORKERS COMPENSATION AND EMPLOYERS' LIABILITY OFFICER/MEMBER EXCLUDED? (Mandatory in NH) DESCRIPTION OF OPERATIONS below If yes, describe under ANY PROPRIETOR/PARTNER/EXECUTIVE $ $ $ E.L. DISEASE - POLICY LIMIT E.L. DISEASE - EA EMPLOYEE E.L. EACH ACCIDENT EROTH-STATUTEPER LIMITS(MM/DD/YYYY)POLICY EXP(MM/DD/YYYY)POLICY EFFPOLICY NUMBERTYPE OF INSURANCELTRINSR DESCRIPTION OF OPERATIONS / LOCATIONS / VEHICLES (ACORD 101, Additional Remarks Schedule, may be attached if more space is required) EXCESS LIAB UMBRELLA LIAB $EACH OCCURRENCE $AGGREGATE $ OCCUR CLAIMS-MADE DED RETENTION $ $PRODUCTS - COMP/OP AGG $GENERAL AGGREGATE $PERSONAL & ADV INJURY $MED EXP (Any one person) $EACH OCCURRENCE DAMAGE TO RENTED $PREMISES (Ea occurrence) COMMERCIAL GENERAL LIABILITY CLAIMS-MADE OCCUR GEN'L AGGREGATE LIMIT APPLIES PER: POLICY PRO-JECT LOC CERTIFICATE OF LIABILITY INSURANCE DATE (MM/DD/YYYY) CANCELLATION AUTHORIZED REPRESENTATIVE ACORD 25 (2016/03) © 1988-2015 ACORD CORPORATION. All rights reserved. CERTIFICATE HOLDER The ACORD name and logo are registered marks of ACORD HIRED AUTOS ONLY Policy Num ber: PSB0005208 RLI Insurance Com pany Named Insured: Kayuga Solution, Inc. T HIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. RLIPack® FOR PROFESSIONALS BLANKET ADDITIONAL INSURED ENDORSEMENT This endorsem ent m odifies insurance provided under the following: BUSINESSOWNERS COVERAGE FORM - SECTION II – LIABILITY 1.C. WHO IS AN INSURED is am ended to include as an additional insured any person or organization that you agree in a contract or agreem ent requiring insurance to include as an additional insured on this policy, but only with respect to liabilit y for "bodil y injury", "property dam age" or "personal and advertising injury" caused in whole or in part by you or those acting on your behalf: a.In the perform ance of your ongoing operations; b.In connection with premises owned by or rented to you; or c.In connection with “your work” and included within the “product-completed operations hazard”. 2.T he insurance provided to the additional insured by this endorsem ent is limited as follows: a.This insurance does not apply on any basis to any person or organization for which coverage as an additional insured specificall y is added b y another endorsem ent to this policy. b.This insurance does not apply to the rendering of or failure to render any "professional services". c.This endorsem ent does not increase any of the limits of insurance stated in D. Liability And Medical Expenses Limits of Insurance. 3.The following is added to SECTION III H.2. Other Insurance – COMMON POLICY CONDITIONS (BUT APPLICABLE ONLY TO SECTION II – LIABILITY) However, if you specifically agree in a contract or agreem ent that the insurance provided to an additional insured under this polic y must apply on a primary basis, or a primary and non-contributory basis, this insur ance is primary to other insurance that is available to such additional insured which covers such additional insured as a nam ed insured, and we will not share with that other insurance, provided that: a.The "bodil y injury" or "property dam age" for which coverage is sought occurs after you have entered into that contract or agreem ent; or b.The "personal and advertising injury" for which coverage is sought arises out of an offense committed after you have entered into that contract or agreem ent. 4.The following is added to SECTION III K. 2. Transfer of Rights of Recovery Against Others to Us – COMMON POLICY CONDITIONS (BUT APPLICABLE TO ONLY TO SECTION II – LIABILITY) We waive an y rights of recover y we may have against any person or organization because of payments we mak e for "bodily injury", "property dam age" or "personal and advertising injury" arising out of "your work" perform ed by you, or on your behalf, under a contract or agreem ent with that person or organization. We waive these rights only where you have agreed to do so as part of a contract or agreem ent with such person or organization entered into by you before the "bodil y injury" or "property dam age" occurs, or the "personal and advertising injury" offense is committed. ALL OTHER TERMS AND CONDITIONS OF THIS POLICY REMAIN UNCHANGED. PPB 304 02 12 Page 1 of 1 Policy Number: PSA0002229 PPA 300 03 13 PPA 300 03 13 Page 1 of 1 THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. BLANKET ADDITIONAL INSURED This endorsement modifies insurance provided un the following: BUSINESS AUTO COVERAGE FORM I.Blanket Additional Insured The following is added to the SECTION II – COVERED AUTOS LIABILITY COVERAGE, Paragraph A.1. Who Is An Insured Provision: Any person or organization that you are required to include as an additional insured on this coverage form in a contract or agreement that is executed by you before the “bodily injury” or “property damage” occurs is an “insured” for liability coverage, but only for damages to which this insurance applies and only to the extent that person or organization qualifies as an “insured” under the Who Is An Insured provision contained in SECTION II – COVERED AUTOS LIABILITY COVERAGE. The insurance provided to the additional insured will be on a primary and non- contributory basis to the additional insured’s own business auto coverage if you are required to do so in a contract or agreement that is executed by you before the “bodily injury” or “property damage” occurs. II.Blanket Waiver Of Subrogation The following is added to the SECTION IV – BUSINESS AUTO CONDITIONS, A. Loss Conditions, 5. Transfer Of Rights Of Recovery Against Others To Us: We waive any right of recovery we may have against any person or organization to the extent required of you by a contract executed prior to any “accident” or “loss”, provided that the “accident” or “loss” arises out of the operations contemplated by such contract. The waiver applies only to the person or organization designated in such contract. Policy Number:PSE0002867 RLI Insurance Company Named Insured: Kayuga Solution, Inc. THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. RLIPack® FOR DESIGN PROFESSIONALS EXCESS LIABILITY ENHANCEMENT SCHEDULE OF COVERAGES ADDRESSED BY THIS ENDORSEMENT B. Additional Insured – Primary/Non-contributory C.Waiver Of Transfer Of Rights Of Recovery Against Others To Us This endorsement modifies insurance provided under the following: COMMERCIAL EXCESS LIABILITY COVERAGE FORM B. Additional Insured – Primary/Non- contributory Paragraph K. Other Insurance of SECTION IV – CONDITIONS is deleted and replaced by the following: K.Other Insurance If other insurance, whether collectible or not, is available to the insured covering a loss also covered by this policy, the insurance afforded by this policy shall be in excess of, and shall not contribute with, such other insurance. However, if the underlying insurance provides coverage to an additional insured on a primary basis, or a primary and non-contributory basis, this insurance shall be available to such additional insured on an excess basis over the underlying insurance. We will not share with other insurance which covers such additional insured as a named insured. C.Waiver Of Transfer Of Rights Of Recovery Against Others To Us Paragraph L. Subrogation of SECTION IV – CONDITIONS is deleted and replaced by the following: L.Subrogation In the event of any payment under this policy, the insured must notify us of any of the insured's rights of recovery against any person or organization. We shall be subrogated to all such rights. The insured shall execute and deliver instruments and papers and do whatever else is necessary to secure such rights. The insured shall do nothing after loss to prejudice such rights. However we waive any rights of recovery we may have against any person or organization if the underlying insurance also waives such rights. Any amount recovered through subrogation or otherwise shall be apportioned in the inverse order of payment of the claim or claims involved to the extent of actual payment thereof by all interests. The expenses of all such recoveries and proceedings in connection therewith shall be apportioned in the ratio of respective recoveries. With respect to proceedings conducted solely by us, if there is no recovery, we will bear the expense thereof. If there is a recovery, we shall be reimbursed in full from such recovery for the amount of all expenses incurred by us before apportionment WORKERS’ COMPENSATION AND EMPLOYERS LIABILITY INSURANCE POLICY WC 04 03 06 (Ed. 04-84) WAIVER OF OUR RIGHT TO RECOVER FROM OTHERS ENDORSEMENT−CALIFORNIA 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.) You must maintain payroll records accurately segregating the remuneration of your employees while engaged in the work described in the Schedule. The additional premium for this endorsement shall be _____% of the California workers’ compensation premium otherwise due on such remuneration. Schedule Person or Organization Job Description All persons or organizations that are party to a Job performed for any person or organization that you contract that requires you to obtain this have agreed with in a written contract to provide this agreement, provided you executed the contract agreement. before a loss 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.) Policy No. PSW0003014 Endorsement No. Endorsement Effective 3/3/2021 Insured Kayuga Solution, Inc. Insurance Company RLI Insurance Company 4. Loss Payment-Physical Damage Coverages At our option, we may: a. Pay for, repair or replace damaged or stolen property; b. Return the stolen property, at our expense. We will pay for any damage that results to the "auto" from the theft; or c. Take all or any part of the damaged or stolen property at an agreed or appraised value. If we pay for the "loss", our payment will include the applicable sales tax for the damaged or stolen property. 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, those rights are transferred to us. That person or organization must do everything necessary to secure our rights and must do nothing after "accident" or "loss" to impair them. B. General Conditions 1. Bankruptcy Bankruptcy or insolvency of the "insured" or the "insured's" estate will not relieve us of any obligations under this Coverage Form. 2. Concealment, Misrepresentation Or Fraud This Coverage Form is void in any case of fraud by you at any time as it relates to this Coverage Form. It is also void if you or any other "insured", at any time, intentionally conceals or misrepresents a material fact concerning: a. This Coverage Form; b. The covered "auto"; c. Your interest in the covered "auto"; or d. A claim under this Coverage Form. 3. Liberalization If we revise this Coverage Form to provide more coverage without additional premium charge, your policy will automatically provide the additional coverage as of the day the revision is effective in your state. 4. No Benefit To Bailee-Physical Damage Coverages We will not recognize any assignment or grant any coverage for the benefit of any person or organization holding, storing or transporting property for a fee regardless of any other provision of this Coverage Form. 5. Other Insurance a. For any covered "auton you own, this Coverage Form provides primary insurance. For any covered "auto" you don't own, the insurance provided by this Coverage Form is excess over any other collectible insurance. However, while a covered nauto" which is a "trailer" is connected to another vehicle, the Covered Autos Liability Coverage this Coverage Form provides for the "trailer" is: (1) Excess while it is connected to a motor vehicle you do not own; or (2) Primary while it is connected to a covered "auto" you own. b. For Hired Auto Physical Damage Coverage, any covered "auto" you lease, hire, rent or borrow is deemed to be a covered "auto" you own. However, any "auto" that is leased, hired, rented or borrowed with a driver is not a covered 11 8Ut011 • c. Regardless of the provisions of Paragraph a. above, this Coverage Form's Covered Autos Liability Coverage is primary for any liability assumed under an "insured contract". d. When this Coverage Form and any other Coverage Form or policy covers on the same basis, either excess or primary, we will pay only our share. Our share is the proportion that the Limit of Insurance of our Coverage Form bears to the total of the limits of all the Coverage Forms and policies covering on the same basis. 6. Premium Audit a. The estimated premium for this Coverage Form is based on the exposures you told us you would have when this policy began. We will compute the final premium due when we determine your actual exposures. The estimated total premium will be credited against the final premium due and the first Named Insured will be billed for the balance, if any. The due date for the final premium or retrospective premium is the date shown as the due date on the bill. If the estimated total premium exceeds the final premium due, the first Named Insured will get a refund. b. If this policy is issued for more than one year, the premium for this Coverage Form will be computed annually based on our rates or premiums in effect at the beginning of each year of the policy. CA 00 011013 ©Insurance Services Office, Inc., 2011 Page 9 of 12 First Amendment to Agreement Final Audit Report 2021-12-09 Created:2021-12-09 By:Julia Kinst (juliak@cupertino.org) Status:Signed Transaction ID:CBJCHBCAABAAfYMsPp0yQr2LkHlrT3gXnLBnpcma9JEz "First Amendment to Agreement" History Document created by Julia Kinst (juliak@cupertino.org) 2021-12-09 - 4:49:31 PM GMT- IP address: 64.165.34.3 Document approved by Julia Kinst (juliak@cupertino.org) Approval Date: 2021-12-09 - 4:51:52 PM GMT - Time Source: server- IP address: 64.165.34.3 Document emailed to Araceli Alejandre (aracelia@cupertino.org) for approval 2021-12-09 - 4:51:54 PM GMT Document approved by Araceli Alejandre (aracelia@cupertino.org) Approval Date: 2021-12-09 - 4:59:33 PM GMT - Time Source: server- IP address: 73.170.27.253 Document emailed to Colin Chung (colin.chung@kayugasolution.com) for signature 2021-12-09 - 4:59:36 PM GMT Email viewed by Colin Chung (colin.chung@kayugasolution.com) 2021-12-09 - 5:12:20 PM GMT- IP address: 74.125.209.35 Document e-signed by Colin Chung (colin.chung@kayugasolution.com) Signature Date: 2021-12-09 - 5:14:43 PM GMT - Time Source: server- IP address: 70.169.225.194 Document emailed to Christopher D. Jensen (christopherj@cupertino.org) for signature 2021-12-09 - 5:14:46 PM GMT Email viewed by Christopher D. Jensen (christopherj@cupertino.org) 2021-12-09 - 5:27:33 PM GMT- IP address: 172.226.36.132 Document e-signed by Christopher D. Jensen (christopherj@cupertino.org) Signature Date: 2021-12-09 - 5:38:38 PM GMT - Time Source: server- IP address: 136.24.42.212 Document emailed to Chad Mosley (chadm@cupertino.org) for signature 2021-12-09 - 5:38:40 PM GMT Email viewed by Chad Mosley (chadm@cupertino.org) 2021-12-09 - 6:32:55 PM GMT- IP address: 104.47.73.126 Document e-signed by Chad Mosley (chadm@cupertino.org) Signature Date: 2021-12-09 - 6:34:40 PM GMT - Time Source: server- IP address: 67.164.60.110 Document emailed to Kirsten Squarcia (kirstens@cupertino.org) for signature 2021-12-09 - 6:34:42 PM GMT Email viewed by Kirsten Squarcia (kirstens@cupertino.org) 2021-12-09 - 6:45:38 PM GMT- IP address: 104.47.73.126 Document e-signed by Kirsten Squarcia (kirstens@cupertino.org) Signature Date: 2021-12-09 - 6:46:37 PM GMT - Time Source: server- IP address: 69.110.137.176 Agreement completed. 2021-12-09 - 6:46:37 PM GMT