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01-08-2019 CC Rpt 12 COUNCIL AGENDA STAFF REPORT Chino I IiEI� TO: HONORABLE MAYOR AND CITY COUNCIL DATE: JANUARY 8, 2019 MEMBERS FROM: CITY MANAGER ITEM NO: 12 SUBJECT:U.S. BANK CAL-CARD PROGRAM RECOMMENDATION: Authorize the City Manager to execute an agreement utilizing the State of California Participating Addendum No. 7-14-99-22 "Local Agency Subscription Agreement" with U.S. Bank to participate in their Purchase Card Program known as CAL-Card. BACKGROUND/ANALYSIS: The City currently uses MasterCard credit cards, issued through Bank of America with a combined credit limit of $55,000 over 12 card holders, for purchases related to travel, online transactions, conferences, training, technology related supplies, etc. With the implementation of a new Financials software module in process, City staff compared the current program with Bank of America to the State of California's Purchasing Card (CAL-Card) Program. The U.S. Bank CAL-Card Program is the State of California's purchasing card program. The State makes this program available to all State, County and local agencies. The CAL-Card is a U.S. Bank issued Visa card which can be used anywhere Visa cards are accepted. The program offers several benefits for the City: • A simplified purchasing and payment process; • Lower overall transaction processing costs per purchase (reduction of warrants); • Reward the City with rebates from the bank based upon dollar volume of total purchases; • Enhanced security of the credit card administration process; • The ability to set and control purchasing limits by individual purchase; • The ability to set an overall monthly spend limit by employee; and • Provide expedited payments to City vendors which will reduce their paperwork and invoicing costs, all of which will increase their cash flow. Most of these benefits the City is already receiving through the Bank of America program, but the CAL-Card program offers enhanced security of the the credit card administration process. For this important reason, City staff recommends participating in the CAL-Card program. Managing the overall aspects of this program will fall upon three responsible groups: the cardholder, the Department Head and the Finance Department. All cards will be in the name of the City and the employee that has been given permission to participate in the program. The employee must follow the Credit Card Policy, resolve any discrepancies that may arise and accurately and timely complete their credit card reconciliation form. The Department Head, or designee, is responsible for reviewing and approving their employees' statements and the credit card reconciliation form. The Finance Department will review all charges for compliance with the policy. 75/253 ENVIRONMENTAL (CEQA) REVIEW: This proposed action is exempt from review under the California Environmental Quality Act (California Public Resources Code §§ 21000, et seq., "CEQA") and CEQA Guidelines (Title 14 California Code of Regulations §§ 15000, et seq.), because it does not involve any commitment to a specific project which could result in a potentially significant physical impact on the environment; and, constitutes an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. Accordingly, this action does not constitute a "project" that requires environmental review (see specifically 14 CCR § 15378(b)(4-5)). FISCAL IMPACT: There is no financial impact on the City as the purchases are part of the approved fiscal budget process. REVIEWED BY OTHERS: None Respectfully Submitted, Recommended By: war Konradt Barllam Christa Buhaiar City Manager Finance Director Attachments Local Agency Subscription Agreement 76/253 embank. serving you State of California Participating Addendum No. 7-14-99-22 Local Agency Subscription Agreement This Local Agency Subscription Agreement ("Local Agency Subscription Agreement") constitutes an agreement to participate under the terms and conditions of the Purchase Card Services Participating Addendum No.7-14-99-22("Participating Addendum") signed September 29, 2014 and entered into by U.S. Bank National Association ("U.S. Bank") and the State of California, Department of General Services("State"). This Local Agency Subscription Agreement is entered into by U.S. Bank and the"Local Governmental Agency"identified herein,and shall become effective upon signing by U.S.Bank("Effective Date"). RECITALS A. The State has entered into the Participating Addendum for the purpose of making available a Purchase Card Program as described in the Participating Addendum for use by State of California state agencies and local governmental agencies; B. The State is willing to permit Local Governmental Agency to participate in the Purchase Card Program provided that Local Governmental Agency assumes all responsibility and liability for Local Governmental Agency's performance of the terms and conditions of the Participating Addendum as if Local Governmental Agency was the entity signing the Participating Addendum, but Local Governmental Agency shall not be liable for the acts and omissions of the State under the Participating Addendum or this Local Agency Subscription Agreement. The State shall not bear liability or responsibility for Local Governmental Agency under the Participating Addendum or this Local Agency Subscription Agreement;and C. Local Governmental Agency has received a copy of the Participating Addendum from the State,and after a thorough review of the Participating Addendum, desires to participate as a Local Governmental Agency under the Participating Addendum. Participating Addendum No. 7-14-99-22 is incorporated into this Local Agency Subscription Agreement in its entirety and all terms and conditions of the Participating Addendum apply to the Local Governmental Agency. AGREEMENT Now therefore, in consideration of the foregoing Recitals, the mutual premises and covenants set forth in the Participating Addendum, which are incorporated herein by reference, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,all parties agree as follows: 1. Local Governmental Agency Responsibility. Local Governmental Agency agrees to accept and perform all duties, responsibilities and obligations required of Participating Agencies as set forth in the Participating Addendum. 2. Authority. The representations, warranties and recitals of Local Governmental Agency set forth in this Local Agency Subscription Agreement and the Participating Addendum constitute valid, binding and enforceable agreements of Local Governmental Agency. All extensions of credit made to Local Governmental Agency pursuant to this Local Agency Subscription Agreement and the Participating Addendum will be valid and enforceable obligations of Local Governmental Agency and Local Governmental Agency shall pay to U.S. Bank all Debts incurred by Local Governmental Agency in accordance with the terms of the Participating Addendum and this Local Agency Subscription Agreement. The execution of this Local Agency Subscription Agreement and the performance of the obligations hereunder and under the Participating Addendum are within the power of Local Governmental Agency, have been authorized by all necessary action and do not constitute a breach of any contract to which Local Governmental Agency is a party or is bound. 3. Purpose of Card Use. Local Governmental Agency declares that cards shall be used for official Local Governmental Agency purchases only, and shall not be used for individual consumer purchases or to incur consumer debt. Local Governmental Agency warrants that it possesses the financial capacity to perform all of its obligations under the Participating Addendum and this Local Agency Subscription Agreement. 4. The notice address for Local Governmental Agency is: City of Chino Hills 14000 City Center Drive Chino Hills,CA 91709 Attn: Nicole Lugotoff,Finance 5. Rebate Payment. To receive payment,Local Governmental Agency must register in the manner prescribed by U.S. Bank.U.S. Bank will not make any payments until Local Governmental Agency has registered. If Local Governmental Agency fails to register by the end of the first Addendum Year,Local Governmental Agency forfeits any payments for that Addendum Year and any subsequent Addendum Years in which Local Governmental Agency fails to register. Local Governmental Agency designates the following person to register Local Governmental Agency. Authorized Person's Name Christa Buhagiar Authorized Person's Email Address cbuhagiar@chinohills.org CPS 1700042 Page 1 of 2 R 5/2017 77/253 6. Billing Statements. Local Governmental Agency may choose to have Statements for all Accounts with Central Billing (1) delivered by U.S. mail ("Paper Statements"); (2) made available electronically ("Electronic Statement(s)") for Local Governmental Agency to access on its own through the account management system or (3) both delivered as Paper Statements and made available as Electronic Statements. If Local Governmental Agency chooses Electronic Statements only, that is,option(2)herein, U.S. Bank will suppress delivery of Paper Statements. 7. Authorization. Local Governmental Agency certifies to U.S. Bank that the person executing this Local Agency Subscription Agreement is authorized by Local Governmental Agency in accordance with its organization rules and applicable law to bind Local Governmental Agency to the terms and conditions of this Local Agency Subscription Agreement, including the authority to incur Debt in the name of Local Governmental Agency. 8. Execution. By signing below, the individual(s) signing this Local Agency Subscription Agreement is/are acting in his or her capacity as an authorized signing officer of Local Governmental Agency and not in his or her personal capacity, and certifies and warrants that(1)all action required by Local Governmental Agency organizational documents to authorize the signer(s)to act on behalf of Local Governmental Agency in all actions taken under this Local Agency Subscription Agreement,including but not limited to, the authority to incur Debt on behalf of Local Governmental Agency, has been taken, (2) each signer is empowered in the name of and on behalf of Local Governmental Agency to enter into all transactions contemplated in this Local Agency Subscription Agreement, and (3) the signatures appearing on all supporting documents of authority, if any, are authentic. 9. Reliance. Local Governmental Agency has read, understands and agrees to all terms and conditions in this Local Agency Subscription Agreement and the Participating Addendum, and U.S. Bank is entitled to act in reliance upon the authorizations and certifications set forth herein. IN WITNESS WHEREOF, the parties have, by their authorized representatives, executed this Local Agency Subscription Agreement. Dated this day of ,20 Dated this day of ,20 By Local Governmental Agency: By U.S.Bank: City of Chino Hills U.S. Bank National Association (Name) (Signature of Authorized Signer) (Signature of Authorized Signer) Michael C.Leppones (Printed Name of Authorized Signer) (Printed Name of Authorized Signer) Vice President (Printed Title of Authorized Signer) (Printed Title of Authorized Signer) Approved as to form: (Signature of Attorney for Local Governmental Agency) (Printed Name of Attorney) CPS 1700042 Page 2 of 2 R 5/2017 78/253