City Council/SA/HA/IDA/PAA/PCA/PFA

The Council Chamber is open for in-person public comment and seating. The Mayor and/or one or more members of the City Council may participate virtually in this meeting. How to observe the meeting virtually: 1. Spectrum local access Channel 27 2. Online live webcast at www.cityofpalmdale.org. How to Submit Public Comments: VERBAL PUBLIC COMMENT DURING THE MEETING – ZOOM Number: US: +1 253 215 8782 Webinar ID: 832 3993 9650 Passcode:029585 Webinar attendee link https://us06web.zoom.us/j/83239939650? pwd=bStSY0d5TE5uL0hUZUNuTnRiL3VGdz09. Verbal comments are typically limited to three (3) minutes unless otherwise directed by CITY COUNCIL MEETING REVISED SPECIAL MEETING SUCCESSOR AGENCY/HOUSING AUTHORITY INDUSTRIAL DEVELOPMENT AUTHORITY PALMDALE AIRPORT AUTHORITY/PALMDALE CIVIC AUTHORITY PALMDALE FINANCING AUTHORITY CITY COUNCIL CHAMBERS 38300 SIERRA HIGHWAY SUITE B PALMDALE, CA 93550 WEDNESDAY, JUNE 29, 2022 5:00 PM 7:00 PM www.cityofpalmdale.org WELCOME City Council Wednesday, June 29, 2022 1

the chair of the meeting; time limits may be increased or decreased at the meeting. Public comments submitted will become part of the official meeting record. The safety and well-being of employees and the public remains the City's top priority. The City of Palmdale appreciates your patience and understanding during these challenging times. The City Council is making every effort to follow the spirit and intent of the Ralph M. Brown Act and other applicable laws regulating the conduct of public meetings in order to maximize transparency and public access. In accordance with the Americans with Disabilities Act of 1990, if you require a disability- related modification or accommodation to participate in this meeting, please contact the City Clerk’s Office at (661) 267-5151 at least 72 hours prior to the meeting. If you require oral Spanish translation, please contact the City Clerk’s Office at (661) 267- 5151 at least 72 hours prior to the meeting. Your courtesy is requested to help our meetings run smoothly. If you’ll be kind enough to follow these simple rules, we can make the best possible use of your time and ours: Please refrain from public displays or outbursts, such as unsolicited applause, comments, cheering, foul language or obscenities. Any disruptive activities that substantially interfere with the ability of the City Council to carry out its meeting will not be permitted and offenders will be asked to leave the meeting. Please turn off/mute your cell phones and mobile devices. 5:00 P.M. 1. MAYOR TO CALL MEETINGS TO ORDER 2. ROLL CALL MAYOR HOFBAUER, MAYOR PRO TEM LOA, COUNCILMEMBERS CARRILLO, BISHOP, BETTENCOURT 3. PUBLIC COMMENTS Pursuant to Government Code section 54954.3, members of the public are provided opportunities to address the City Council. This meeting is a special meeting. Therefore, you may address the Council once per meeting during Public Comments on any matter on the agenda. Please submit a Speaker's Form to the City Clerk BEFORE this portion of the meeting begins. As this is a special meeting, comments should not be made on items City Council Wednesday, June 29, 2022 2

not listed on the agenda. To address the Council regarding an item on the agenda, please fill out a Speaker's Form and submit it to the City Clerk BEFORE the Mayor announces the item. Each person addressing the Council is customarily given up to three minutes to speak (with double the time allotted to non-English speakers using a translator). The amount of time authorized may be adjusted by the chair. If you wish to provide information to the Council, please present the City Clerk with 7 copies. Otherwise, your materials will simply be added to the administrative record. If you are attending the meeting by phone, please press *9 to "raise your hand." If attending by personal computer, please click the "raise your hand" button. Press *6 to un-mute yourself, state your name and begin speaking. 4. PRESENTATION BY CITY ATTORNEY 4.1 CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION Shanae Smith, Patricia Nevarez, and Michael "Mike" Behen vs. City of Palmdale, et al. Los Angeles County Superior Court Case No. 22STCV18219 This closed session is being held pursuant to the authority of California Government Code Section 54956.9(d)(1). 4.2 CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION Leona Valley Town Council vs. City of Palmdale, et al. Los Angeles County Superior Court Case No. 22STCP01932 This closed session is being held pursuant to the authority of California Government Code Section 54956.9(d)(1). 4.3 CONFERENCE WITH LEGAL COUNSEL—ANTICIPATED LITIGATION Significant exposure to litigation pursuant to Government Code 54956.9(d)(2): 3 potential cases 4.4 PUBLIC EMPLOYEE APPOINTMENT Title: Interim City Attorney or City Attorney 4.5 CONFERENCE WITH LABOR NEGOTIATORS City Representatives: Ronda Perez, Interim City Manager and Patricia Nevarez, Human Resources Manager Position: Interim City Attorney or City Attorney This Closed Session is being held pursuant to the authority of California City Council Wednesday, June 29, 2022 3

Government Code Section 54957.6. 4.6 CONFERENCE WITH LEGAL COUNSEL—EXISTING LITIGATION Ricci v. City of Palmdale, et al. Los Angeles County Superior Court Case No. 22STCV01269 This closed session is being held pursuant to the authority of California Government Code Section 54956.9(d)(1). 5. ANNOUNCEMENT BY CITY ATTORNEY 6. ADJOURN CLOSED SESSION MEETING 7:00 P.M. 7. PLEDGE OF ALLEGIANCE AND MOMENT OF SILENCE IN HONOR OF OUR TROOPS 8. ROLL CALL MAYOR/CHAIR HOFBAUER, MAYOR PRO TEM/VICE CHAIR/CHAIR PRO TEM LOA, COUNCILMEMBERS/DIRECTORS/MEMBERS/COMMISSIONERS CARRILLO, BISHOP, BETTENCOURT, FRAGA-SAENZ, DENNY 9. WAIVER OF FULL READING OF RESOLUTION(S) and ORDINANCE(S) Staff Recommendation: Move to waive full reading of the Resolution (s) and/or Ordinance(s) to be considered and voted on at this meeting. (Voice Vote - Requires a majority to waive.) 10. PUBLIC COMMENTS Pursuant to Government Code section 54954.3, members of the public are provided opportunities to address the City Council. This meeting is a special meeting. Therefore, you may address the Council once per meeting during Public Comments on any matter on the agenda. Please submit a Speaker's Form to the City Clerk BEFORE this portion of the meeting begins. As this is a special meeting, comments should not be made on items not listed on the agenda. To address the Council regarding an item on the agenda, please fill out a Speaker's Form and submit it to the City Clerk BEFORE the Mayor announces the item. Each person addressing the Council is customarily given up to three minutes to speak (with double the time allotted to non-English speakers using a translator). The amount of time authorized may be adjusted by the chair. If you wish to provide information to the Council, please present the City Clerk with 7 copies. Otherwise, your materials will simply be added to the administrative record. If you are attending the meeting by phone, please press *9 to "raise your hand." If attending by personal City Council Wednesday, June 29, 2022 4

computer, please click the "raise your hand" button. Press *6 to un-mute yourself, state your name and begin speaking. 11. JOINT PUBLIC HEARING CC/SA/HA/IDA/PAA/PCA/PFA 11.1 Public Hearing and Review of Proposed Joint Resolution Nos. CC 2022-066, SA2022-004, PCA 2022-002, HA 2022-001, IDA 2022-001, PAA 2022-001, and PFA 2022-001 approving the Annual Operating and Capital Budget for Fiscal Year 2022-23. (Staff Reference: Director of Finance Samson) A Joint Resolution of the City Council of the City of Palmdale, the Successor Agency to the Community Redevelopment Agency of the City of Palmdale, the Palmdale Civic Authority, the Housing Authority of the City of Palmdale, the Industrial Development Authority, the Palmdale Airport Authority of the City of Palmdale, and the Palmdale Financing Authority approving and adopting the City of Palmdale's Annual Budget for Fiscal Year 2022-23, and approving revenue and expenditure adjustments to Fiscal Year 2021-22. 1. Staff Report Proposed Budget FY 2022-23_6.29.22.docx 2. Reso Adopt Budget FY 2022-23.doc 3. 2022-23 Annual Budget Draft Proposed 6.29.22_Final.pdf 12. ADJOURN HOUSING AUTHORITY 13. PUBLIC HEARING 13.1 Public Hearing and Review of Proposed Resolution No. CC 2022-065 for adoption, regarding an updated city wide fee schedule. (Staff Reference: Director of Finance Samson) Adopt Resolution No. CC 2022-065, A Resolution of the City Council of the City Council of the City of Palmdale restating in its entirety the Palmdale Master Schedule of Fees and repealing Resolution No.CC 2021-057. 1._FY_2022-23_Staff_Report_Citywide_Fee_Resolution_Final_JS(1).docx 2._FY_2022-23_Reso_CC_2022-065_Citywide_Fee_Resolution_Final_1_.doc 3. Palmdale Fee Schedule_Proposed 06.29.22.pdf 14. ADJOURN City Council Wednesday, June 29, 2022 5

The Council Chamber is open for in-person public comment and seating. The Mayor and/or one or more members of the City Council may participate virtually in this meeting. How to observe the meeting virtually: 1. Spectrum local access Channel 27 2. Online live webcast at www.cityofpalmdale.org. How to Submit Public Comments: VERBAL PUBLIC COMMENT DURING THE MEETING – ZOOM Number: US: +1 253 215 8782 Webinar ID: 832 3993 9650 Passcode:029585 Webinar attendee link https://us06web.zoom.us/j/83239939650? pwd=bStSY0d5TE5uL0hUZUNuTnRiL3VGdz09. Verbal comments are typically limited to three (3) minutes unless otherwise directed by CITY COUNCIL MEETING REVISED SPECIAL MEETING SUCCESSOR AGENCY/HOUSING AUTHORITY INDUSTRIAL DEVELOPMENT AUTHORITY PALMDALE AIRPORT AUTHORITY/PALMDALE CIVIC AUTHORITY PALMDALE FINANCING AUTHORITY CITY COUNCIL CHAMBERS 38300 SIERRA HIGHWAY SUITE B PALMDALE, CA 93550 WEDNESDAY, JUNE 29, 2022 5:00 PM 7:00 PM www.cityofpalmdale.org WELCOME City Council Wednesday, June 29, 2022

the chair of the meeting; time limits may be increased or decreased at the meeting. Public comments submitted will become part of the official meeting record. The safety and well-being of employees and the public remains the City's top priority. The City of Palmdale appreciates your patience and understanding during these challenging times. The City Council is making every effort to follow the spirit and intent of the Ralph M. Brown Act and other applicable laws regulating the conduct of public meetings in order to maximize transparency and public access. In accordance with the Americans with Disabilities Act of 1990, if you require a disability- related modification or accommodation to participate in this meeting, please contact the City Clerk’s Office at (661) 267-5151 at least 72 hours prior to the meeting. If you require oral Spanish translation, please contact the City Clerk’s Office at (661) 267- 5151 at least 72 hours prior to the meeting. Your courtesy is requested to help our meetings run smoothly. If you’ll be kind enough to follow these simple rules, we can make the best possible use of your time and ours: Please refrain from public displays or outbursts, such as unsolicited applause, comments, cheering, foul language or obscenities. Any disruptive activities that substantially interfere with the ability of the City Council to carry out its meeting will not be permitted and offenders will be asked to leave the meeting. Please turn off/mute your cell phones and mobile devices. 5:00 P.M. 1. MAYOR TO CALL MEETINGS TO ORDER 2. ROLL CALL MAYOR HOFBAUER, MAYOR PRO TEM LOA, COUNCILMEMBERS CARRILLO, BISHOP, BETTENCOURT 3. PUBLIC COMMENTS Pursuant to Government Code section 54954.3, members of the public are provided opportunities to address the City Council. This meeting is a special meeting. Therefore, you may address the Council once per meeting during Public Comments on any matter on the agenda. Please submit a Speaker's Form to the City Clerk BEFORE this portion of the meeting begins. As this is a special meeting, comments should not be made on items City Council Wednesday, June 29, 2022

not listed on the agenda. To address the Council regarding an item on the agenda, please fill out a Speaker's Form and submit it to the City Clerk BEFORE the Mayor announces the item. Each person addressing the Council is customarily given up to three minutes to speak (with double the time allotted to non-English speakers using a translator). The amount of time authorized may be adjusted by the chair. If you wish to provide information to the Council, please present the City Clerk with 7 copies. Otherwise, your materials will simply be added to the administrative record. If you are attending the meeting by phone, please press *9 to "raise your hand." If attending by personal computer, please click the "raise your hand" button. Press *6 to un-mute yourself, state your name and begin speaking. 4. PRESENTATION BY CITY ATTORNEY 4.1 CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION Shanae Smith, Patricia Nevarez, and Michael "Mike" Behen vs. City of Palmdale, et al. Los Angeles County Superior Court Case No. 22STCV18219 This closed session is being held pursuant to the authority of California Government Code Section 54956.9(d)(1). 4.2 CONFERENCE WITH LEGAL COUNSEL - EXISTING LITIGATION Leona Valley Town Council vs. City of Palmdale, et al. Los Angeles County Superior Court Case No. 22STCP01932 This closed session is being held pursuant to the authority of California Government Code Section 54956.9(d)(1). 4.3 CONFERENCE WITH LEGAL COUNSEL—ANTICIPATED LITIGATION Significant exposure to litigation pursuant to Government Code 54956.9(d)(2): 3 potential cases 4.4 PUBLIC EMPLOYEE APPOINTMENT Title: Interim City Attorney or City Attorney 4.5 CONFERENCE WITH LABOR NEGOTIATORS City Representatives: Ronda Perez, Interim City Manager and Patricia Nevarez, Human Resources Manager Position: Interim City Attorney or City Attorney This Closed Session is being held pursuant to the authority of California City Council Wednesday, June 29, 2022

Government Code Section 54957.6. 4.6 CONFERENCE WITH LEGAL COUNSEL—EXISTING LITIGATION Ricci v. City of Palmdale, et al. Los Angeles County Superior Court Case No. 22STCV01269 This closed session is being held pursuant to the authority of California Government Code Section 54956.9(d)(1). 5. ANNOUNCEMENT BY CITY ATTORNEY 6. ADJOURN CLOSED SESSION MEETING 7:00 P.M. 7. PLEDGE OF ALLEGIANCE AND MOMENT OF SILENCE IN HONOR OF OUR TROOPS 8. ROLL CALL MAYOR/CHAIR HOFBAUER, MAYOR PRO TEM/VICE CHAIR/CHAIR PRO TEM LOA, COUNCILMEMBERS/DIRECTORS/MEMBERS/COMMISSIONERS CARRILLO, BISHOP, BETTENCOURT, FRAGA-SAENZ, DENNY 9. WAIVER OF FULL READING OF RESOLUTION(S) and ORDINANCE(S) Staff Recommendation: Move to waive full reading of the Resolution (s) and/or Ordinance(s) to be considered and voted on at this meeting. (Voice Vote - Requires a majority to waive.) 10. PUBLIC COMMENTS Pursuant to Government Code section 54954.3, members of the public are provided opportunities to address the City Council. This meeting is a special meeting. Therefore, you may address the Council once per meeting during Public Comments on any matter on the agenda. Please submit a Speaker's Form to the City Clerk BEFORE this portion of the meeting begins. As this is a special meeting, comments should not be made on items not listed on the agenda. To address the Council regarding an item on the agenda, please fill out a Speaker's Form and submit it to the City Clerk BEFORE the Mayor announces the item. Each person addressing the Council is customarily given up to three minutes to speak (with double the time allotted to non-English speakers using a translator). The amount of time authorized may be adjusted by the chair. If you wish to provide information to the Council, please present the City Clerk with 7 copies. Otherwise, your materials will simply be added to the administrative record. If you are attending the meeting by phone, please press *9 to "raise your hand." If attending by personal City Council Wednesday, June 29, 2022

computer, please click the "raise your hand" button. Press *6 to un-mute yourself, state your name and begin speaking. 11. JOINT PUBLIC HEARING CC/SA/HA/IDA/PAA/PCA/PFA 11.1 Public Hearing and Review of Proposed Joint Resolution Nos. CC 2022-066, SA2022-004, PCA 2022-002, HA 2022-001, IDA 2022-001, PAA 2022-001, and PFA 2022-001 approving the Annual Operating and Capital Budget for Fiscal Year 2022-23. (Staff Reference: Director of Finance Samson) A Joint Resolution of the City Council of the City of Palmdale, the Successor Agency to the Community Redevelopment Agency of the City of Palmdale, the Palmdale Civic Authority, the Housing Authority of the City of Palmdale, the Industrial Development Authority, the Palmdale Airport Authority of the City of Palmdale, and the Palmdale Financing Authority approving and adopting the City of Palmdale's Annual Budget for Fiscal Year 2022-23, and approving revenue and expenditure adjustments to Fiscal Year 2021-22. 1. Staff Report Proposed Budget FY 2022-23_6.29.22.docx 2. Reso Adopt Budget FY 2022-23.doc 3. 2022-23 Annual Budget Draft Proposed 6.29.22_Final.pdf 12. ADJOURN HOUSING AUTHORITY 13. PUBLIC HEARING 13.1 Public Hearing and Review of Proposed Resolution No. CC 2022-065 for adoption, regarding an updated city wide fee schedule. (Staff Reference: Director of Finance Samson) Adopt Resolution No. CC 2022-065, A Resolution of the City Council of the City Council of the City of Palmdale restating in its entirety the Palmdale Master Schedule of Fees and repealing Resolution No.CC 2021-057. 1._FY_2022-23_Staff_Report_Citywide_Fee_Resolution_Final_JS(1).docx 2._FY_2022-23_Reso_CC_2022-065_Citywide_Fee_Resolution_Final_1_.doc 3. Palmdale Fee Schedule_Proposed 06.29.22.pdf 14. ADJOURN City Council Wednesday, June 29, 2022

Joint Staff Report DATE: JUNE 29, 2022 TO: HONORABLE MAYOR AND CITY COUNCIL HONORABLE CHAIR AND COMMISSIONERS HONORABLE CHAIR AND MEMBERS HONORABLE CHAIR AND DIRECTORS FROM: CITY MANAGER DEPARTMENT FINANCE DIVISION DISTRICT: ALL SUBJECT: PUBLIC HEARING TO ADOPT JOINT RESOLUTION NO. CC 2022- 066, SA 2022-004, HA 2022-001, IDA 2022-001, PAA 2022-001, PCA 2022-002 AND PFA 2022-001 APPROVING THE ANNUAL OPERATING AND CAPITAL IMPROVEMENT BUDGET FOR FISCAL YEAR 2022-23. ISSUE Public Hearing to adopt Joint Resolution No. CC 2022-066, SA 2022-004, HA 2022-001, IDA 2022-001, PAA 2022-001, PCA 2022-002 and PFA 2022-001, approving the Annual Operating and Capital Improvement Budget for Fiscal Year 2022-23. RECOMMENDATION Staff recommends that:  The City Council, Chairs, Commissioners, Members and Directors conduct a public hearing to adopt Joint Resolution No. CC 2021-058, SA 2021-005, HA 2021-002, IDA 2021-001, PAA 2021-001, PCA 2021-002 and PFA 2021-002, approving the Annual Operating and Capital Improvement Budget for Fiscal Year 2022-23, and approving revenue and expenditure adjustments to Fiscal Year 2021-22; BACKGROUND Each year the City is required to adopt a budget for the operation of the City. The budget serves as the City’s financial plan for the Fiscal Year beginning July 1 through June 30. It defines City priorities for the provision of services to the community. According to the Palmdale Municipal Code: Chapter 3.04 Budget Adoption Procedures, the City Manager shall submit a proposed budget to the City Council no later than May 31st of each year. Additionally, the City Council shall conduct a public hearing on the proposed budget before adoption and shall adopt a budget prescribing the spending

Report to Mayor and City Council, Chairs, Commissioners, Members, and Directors Re: Proposed Annual Budget FY 2022-23 June 29, 2022 Page 2 policy of the City for the ensuing fiscal year on or before the thirtieth day of June of each year. On May 11, 2022, the Library Board of Trustees reviewed the proposed budget made a unanimous recommendation to the City Council to approve the proposed Library budget. On May 12, 2022, the Planning Commission unanimously found that the proposed Capital Improvement Program is consistent with the goals, objectives, and policies of the General Plan. On May 18, 2022, the City Council was presented with a draft of the proposed Annual Budget for Fiscal Year 2022-23. On May 25, 2022, the Measure AV Oversight Committee was presented with a draft of the proposed Measure AV budget for FY 2022-23 and provided feedback and a recommendation for approval. DISCUSSION Staff is bringing forth the Proposed Budget for Fiscal Year 2022-23 for your review and consideration. As the City continues to recover from the impacts of Covid-19 pandemic, staff have remained focused and committed to providing quality programs and services to our residents. In alignment with the City’s adopted Strategic Plan, below is a list of program highlights planned for FY 2023:  Reinstated and expanded recreation activities, venues and events  Community grant programs  Continued food distribution programs at SAVES  Investment in infrastructure  Expansion of illegal dumping and graffiti clean-up efforts  Housing Element implementation  Permanent Local Housing Allocation Plan  Waste Diversion – organics processing to comply with SB 1383  Emergency management  Film and Tourism programs  Enhanced staffing levels to manage programs and to ensure a high level of customer service for our community PERSONNEL With the need to maintain and enhance certain services, additions to personnel are necessary. The table below provides a summary of proposed personnel actions:

Report to Mayor and City Council, Chairs, Commissioners, Members, and Directors Re: Proposed Annual Budget FY 2022-23 June 29, 2022 Page 3 FY 2022-23 Description Number Amount New Positions * 19 $ 1,675,320 Equity Adjustments 0 $0 Reclassifications 0 $0 Title Changes** 4 $0 Total 19 $1,675,320 * New positions include two (2) part-time to full-time conversions and three (3) part-time positions. ** There is no change in salary proposed for four (4) positions under Title Changes. Proposed salary and benefits Citywide include:  3% (2% COLA and 1% wage increase) to employees;  City match on employee deferred compensation plan up to $1,200 per year for all eligible employees;  Premium pay for qualifying full-time and part-time employees, to be funded by American Rescue Plan Act funds in the amount of $1.5 million and General Funds in the amount of $250,000. This one-time payment is proposed in the amount of $4,000 for eligible full-time employees and $500 for eligible part-time employees. Prorated rates may apply.  Premium pay for qualifying Lifeguard staff proposed to be funded by American Rescue Plan Act funds. In response to the national lifeguard shortage affecting public pools across the country, staff proposes a pay for performance program for summer 2022 using ARPA funds. While City of Palmdale pools remained open during the pandemic to sustain retention and offered additional lifeguard certification classes, Palmdale remains impacted by this national shortage. Proposed performance program: Maximum amount of premium pay: $2,000 Pay is a cumulative amount based on total hours worked: o 100 hours - $500 o 300 hours - $500 o 500 hours - $500 o 700 hours - $500 Eligibly period: Retroactive from May 1, 2022 through September 30, 2022  Staff is proposing to implement 401A plans for select employees who are impacted by CalPERS limitations. This does not have a fiscal impact in FY 2022-23 proposed budget and would be brought back before Council as necessary to move forward with implementation.

Report to Mayor and City Council, Chairs, Commissioners, Members, and Directors Re: Proposed Annual Budget FY 2022-23 June 29, 2022 Page 4 GENERAL FUND Revenues 1. Property Taxes are anticipated to increase by 4.6% due to property values increasing. 2. Sales Taxes are expected to increase by 4.8% based on economic performance in the City. 3. Charges for services are expected to increase by 35% as a result of Parks & Recreation programs being reinstated, as well as an increase in processing and planning fees. 4. Other revenues are expected to increase dramatically, by 189%, in FY 2023 as a result of a one-time economic development property sale. Expenditures 1. Salaries and benefits are expected to increase by 3% (2% COLA and 1% wage increase) to employees. Other increases in the General Fund are a result of new positions proposed in FY 2023. 2. LA County Sheriff Contract is expected to increase by 5.5% per the existing contract. The cost of the contract is proposed to be covered by multiple funding sources, including ARPA and Measure AV to relieve some burden from the General Fund. There is no increase in services or change in scope proposed in this budget. Amounts proposed are to maintain existing levels of services. 3. LA County Sheriff Contract Liability is expected to increase by 11.5%, or $364,200. 4. Transfers to Reserves for FY 2023 include: a. Pension Trust Fund to stabilize fluctuations in CalPERS rates: $1.25 million b. Fleet maintenance to fund ongoing replacement of the City’s fleet: $250,000 c. Information Technology to fund the ongoing upgrade of the City’s technology infrastructure: $250,000 d. Drytown Waterpark to fund the ongoing capital costs relating to maintenance and improvements of the park: $500,000 e. Park Development to establish healthy reserves in the event the City chooses to fund large projects in the future: $2 million MEASURE AV Fiscal Year 2022 was the first full year generating revenue through Measure AV. It was initially estimated that Measure AV would generate $15.5 million in revenues from the ¾ cent sales tax that was passed by voters in November 2020, however, sales tax outperformed expectations and is now estimated to generate $21.9 million for FY

Report to Mayor and City Council, Chairs, Commissioners, Members, and Directors Re: Proposed Annual Budget FY 2022-23 June 29, 2022 Page 5 2022. It is expected that Measure AV will generate approximately $23.1 million in FY 2023, based on economic trends and projections performed by the City’s sales tax consultants. Proposed expenditures under Measure AV fund are outlined by project and/or program in greater detail on the attached budget sheets. Below are some highlights of programs proposed for funding: 1. Public Safety a. Animal Control: $625,000 b. Emergency Management: $261,670 c. Community Compliance: $1.4 million d. LA County Sheriff Contract: $8.4 million 2. Infrastructure/CIP a. Safe and Clean Parks: $9.3 million b. Graffiti Abatement: $660,000 c. CIP – Multi-Year Projects: $5.8 million 3. Community Programs a. SAVES: $125,000 b. Unhoused Programs: $100,000 c. Senior Programs: $500,000 d. Community Events: $500,000 e. Community Grant Programs: $2 million 4. Economic Development a. Business retention and partnership programs: $1.6 million b. Film & Tourism: $100,000 5. Administrative Costs to support administration of the Fund, and staffing to implement and manage programs: $131,520 AMERICAN RESCUE PLAN ACT FUNDS (ARPA) The City of Palmdale received an allocation of $35.4 million in funds as a result of the American Rescue Plan Act. The City received the first of two disbursements of funds in July 2021, with the second disbursement expected before the end of FY 2022. U.S. Department of Treasury released the Final Rule on April 1, 2022, implementing the statutory provisions on eligible and ineligible uses of funds. In accordance with the Final Rule, staff has prepared a proposed budget, as highlighted below. Details can be found on the attachments provided for each category listed. Expenditures FY 2022 Projected FY 2023 Proposed 1. Public Health $1,265,400 $11,610,000

Report to Mayor and City Council, Chairs, Commissioners, Members, and Directors Re: Proposed Annual Budget FY 2022-23 June 29, 2022 Page 6 2. Negative Economic Impacts 525,000 2,375,000 3. Services to Disproportionately Impacted Communities 598,100 6,414,300 4. Premium Pay 0 1,500,000 5. Water, Sewer & Broadband Infrastructure 0 500,000 6. Revenue Replacement 2,855,200 184,300 7. Administrative & Other 25,000 197,500 Expenditure Total $5,268,700 $22,781,100 SPECIAL REVENUE FUNDS Special Revenue and other funds consist of transportation funds, grants, and other forms of restricted funding. Use of money in certain funds are governed by memorandums of understanding, contracts, or law. Required audits are conducted each year to ensure compliance with granting agencies. One of the largest sources of revenue used by the City to pay for maintenance, repair, and improvement of streets and facilities is transportation funding. These are sales tax revenues that are collected by the State or County and allocated to the City based on a percent of population. The below table shows the FY 2023 proposed Transportation fund expenditures: Transportation Funds FY 2022 Projected FY 2023 Proposed Gas Tax Fund $13,979,260 $6,957,430 Prop A Fund 6,044,950 3,567,450 Prop C Fund 9,590,040 2,931,200 Local Transp Fund Art 3 20,000 0 Local Transp Fund Art 8 7,881,220 8,668,190 Measure R Fund 4,410,190 50,000 Measure M Fund 4,756,250 750,000 Expenditure Total $46,681,910 $22,924,270 The City uses these funds specifically to fund street repair maintenance and improvement activities such as traffic engineering, geographical information system software and staffing, bus stop and transportation center maintenance and public works staffing. Depending on the source of funding, balances may carry over from year to year in order to complete larger projects.

Report to Mayor and City Council, Chairs, Commissioners, Members, and Directors Re: Proposed Annual Budget FY 2022-23 June 29, 2022 Page 7 CAPITAL IMPROVEMENT PROGRAM The proposed FY 2023 Capital Improvement budget consists of a variety of projects totaling $98.8 million. Many of the proposed projects are funded by grants or other restricted funds. It is also important to keep in mind that capital projects are often a multi-year effort, and therefore the budget established will carry through the life of the project and may not be fully expended in the single year shown. The attached schedules provide a comprehensive listing of all previously approved and proposed capital improvement projects. CONCLUSION The proposed FY 2022-23 Budget is balanced and represents the City’s commitment to the long-term planning and sustainability of programs and services for the community. FISCAL IMPACT The Fiscal Year 2022-23 Operating Budget will serve as the financial guideline for program implementation for the year. The proposed annual budget is compliant with all Financial Policies, including the 20% General Fund Reserve Requirement, with a 30% reserve proposed in the budget. It is anticipated that revenues will be sufficient to cover the expenditures proposed. STRATEGIC PLAN Goal II: Ensure long-term fiscal health of the City and maintain funding for services. B. Manage resources, costs, and liabilities to ensure the City’s long-term fiscal health. C. Involve and expand engagement to enhance public oversight and transparency. Prepared by: Janelle Samson, Director of Finance Certified as to availability of Funds: Janelle Samson, Director of Finance Approved by: Ronda Perez, Interim City Manager Approved as to form: Scott E. Porter, Acting City Attorney ATTACHMENTS 1. Proposed Annual Budget for Fiscal Year 2022-23. 2. Joint Resolution No. CC 2022-066, SA 2022-004, PCA 2022-002, HA 2022- 001, IDA 2022-001, PAA 2022-001, and PFA 2022-001

CITY COUNCIL SUCCESSOR AGENCY TO THE COMMUNITY REDEVELOPMENT AGENCY PALMDALE CIVIC AUTHORITY, HOUSING AUTHORITY INDUSTRIAL DEVELOPMENT AUTHORITY, PALMDALE AIRPORT AUTHORITY AND PALMDALE FINANCING AUTHORITY CITY OF PALMDALE, CALIFORNIA JOINT RESOLUTION NO. CC 2022-066 SUCCESSOR AGENCY TO THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALMDALE RESOLUTION NO. SA 2022-004 PALMDALE CIVIC AUTHORITY RESOLUTION NO. PCA 2022-002 HOUSING AUTHORITY RESOLUTION NO. HA 2022-001 INDUSTRIAL DEVELOPMENT AUTHORITY RESOLUTION NO. IDA 2022-001 PALMDALE AIRPORT AUTHORITY RESOLUTION NO. PAA 2022-001 PALMDALE FINANCING AUTHORITY RESOLUTION NO. PFA 2022-001 A JOINT RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PALMDALE, THE SUCCESSOR AGENCY TO THE COMMUNITY REDEVELOPMENT AGENCY OF THE CITY OF PALMDALE, THE PALMDALE CIVIC AUTHORITY, THE HOUSING AUTHORITY OF THE CITY OF PALMDALE, THE INDUSTRIAL DEVELOPMENT AUTHORITY, THE PALMDALE AIRPORT AUTHORITY OF THE CITY OF PALMDALE, AND THE PALMDALE FINANCING AUTHORITY APPROVING AND ADOPTING THE CITY OF PALMDALE’S BIENNIAL BUDGET FOR FISCAL YEAR 2021-22 AND FISCAL YEAR 2022-23, AND APPROVING REVENUE AND EXPENDITURE ADJUSTMENTS TO FISCAL YEAR 2020-21. WHEREAS, in accordance with the City of Palmdale Municipal Code Section 3.04.020, the City Manager shall submit a proposed budget to the City Council no later than May 31 st of each year; and, WHEREAS, the City