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Naples Heritage Agenda 11/03/2020 Naples Heritage Community Development District Board of Supervisors o Kenneth R.Gaynor,Chairman o Peter V.Ramundo,Vice Chairman o Justin Faircloth,District Manager o Gerald G.James,Assistant Secretary ❑Gregory L.Urbancic,District Counsel o Richard J.Leonhard,Assistant Secretary o W.Terry Cole,District Engineer o Tom Rutkowski,Assistant Secretary Meeting Agenda November 3,2020—9:00 a.m. Audit Committee Meeting 1. Roll Call 2. Audit Committee Selection of Auditor A. Review of Audit Firm Proposals B. Ranking of Audit Proposals for FY 2020 3. Audience Comments 4. Adjournment Regular Meeting 1. Roll Call 2. Public Comment on Agenda Items 3. Approval of the Minutes of the May 5,2020 Meeting 4. Old Business A. Master Association Club Expansion Update B. Bentley Electrical Proposal for Lakes 2&8 Aeration Install C. Solitude Proposal Aeration Install Lakes 2&8 5. New Business A. Auditor Selection i. Consideration of the Audit Committee Ranking Recommendations ii. Authorization to Proceed to Enter into Contract with Selected Audit Firm B. PRIA FY 2021 Insurance Policy C. Resolution 2021- 1,Spending Resolution D. Lake 12/Hole 12 Fountain Discussion 6. Manager's Report A. Acceptance of Financial Statements B. Motion to Assign Reserves C. Solitude Lake Management Service Report D. Follow Up Items 7. Attorney's Report A.Legislative Update District Office: Meeting Location: 210 N.University Drive,Suite 702 Naples Heritage Golf&Country Club Clubhouse Coral Springs,FL 33071 8150 Heritage Club Way 954-603-0033 Naples,Florida 8. Engineer's Report 9. Supervisors' Requests 10. Audience Comments 11. Adjournment The next meeting is scheduled for January 5,2021 District Office: Meeting Location: 210 N. University Drive,Suite 702 Naples Heritage Golf&Country Club Clubhouse Coral Springs, FL 33071 8150 Heritage Club Way 954-603-0033 Naples,Florida Napki llailij PART OF THE USA TODAY NET WORK Published Daily Naples, FL 34110 NAPLES HERITAGE CDD 5911 COUNTRY LAKES DR Notice of Regular and Audit Committee Meeting FORT MYERS, FL 33905-5507 Naples Heritage Community Development District The Regular meeting of the Board of Supervisors of the Naples Heritage Community Development District is scheduled to be held Tuesday, November 3.2020 at 9:00 a.m.at the Naples Her Affidavit of Publication itage Golf and Country Club Clubhouse, 8150 Heritage Club Way,Naples,Florida. STATE OF WISCONSIN Also,during this meeting, the Audit Committee will review, dis- COUNTY OF BROWN cuss, evaluate and rank the proposals received in response to the Requests for Proposals for Annual Audit Services relating to the audit for the Fiscal Year ended September 30,2020 and sub- Before the undersigned they serve as the authority, sequent years as previously advertised in accordance with Florl• da Law. The meeting is open to the public and will be conduct personally appeared said legal clerk who on oath says that ed in accordance with the provisions of Florida Law for Corn- he/she serves as Legal Clerk of the Naples Daily News, a triunity Development Districts. The meeting may be continued to a date, time, and place to be specified on the record at the daily newspaper published at Naples, in Collier County, meeting. A copy of the agenda for this meeting may be ob Florida; distributed in Collier and Lee counties of Florida; tained from the District Manager's office,Inframark, by contact- ing 954-603-0033 or by email, Justin.Fairciotheinframark.com that the attached copy of the advertising was published in Additionally, Interested parties may refer to the District's said newspaper on dates listed. Affiant further says that the website for the latest information:www.naplesheritagecdd.com Please note that pursuant to Governor DeSantis' Executive Or- said Naples Daily News is a newspaper published at der 20-69(as extended by Executive Orders 20-112, 20.123, 20- Naples, in said Collier County, Florida, and that the said 139,20-150, 20-179, 20-193 and 20-246 and as it may be further extended or amended) relating to the COVID-19 public health newspaper has heretofore been continuously published in emergency and to protect the public and follow the CDC guid- said ante regarding social distancing, such public hearing and meet ing may be held telephonically or virtually. The District fully en- Collier County, Florida; distributed in Collier and Lee courages public participation in a safe and efficient manner. In- counties of Florida, each day and has been entered as terested parties may refer to the District's website for the latest information: www.naplesherttagecdd.com. Additionally, partic- second class mail matter at the post office in Naples, in ipants are encouraged to submit questions and comments to said Collier County, Florida, for a period of one year next the District Manager in advance at justin.fairclotheinframark.co m to facilitate the Board and Committee's consideration of such preceding the first publication of the attached copy of questions and comments during a meeting, advertisement; and affiant further says that he has neither Any person requiring special accommodations at this meeting because of a disability or physical Impairment should contact paid nor promised any person, or corporation any discount, the District Manager's Office at least forty-eight(48)hours lariat rebate, commission or refund for the purpose of securing to the meeting. if you are hearing or speech impaired, ease contact the Florida Relay Service by dialing 7.1-1, or i-800.955 this advertisement for publication in the said newspaper. 8771 (TTY) / 1-800-955-8770 (Voice), for aid in contacting the District Manager's Office. Each person who decides to appeal any decision made by the Published: 10/22/2020 Board with respect to any matter considered at the meeting is advised that person will need a record of the proceedings and `" ••••••�� that accordingly, the person may need to ensure that a verba tim record of the proceedings is made, including the testimony and evidence upon which such appeal is to be based. Subscribed and sworn to before on October 22,2020: Justin Faircloth District Manager October 22,2020 #4429094 t`V\ UYl r,:Q-�.LX .. Notary,State of WI,County of Brown TARA MONDLOCI-I Notary Public State of Wisconsin t My commission expires August 6,2021 Publication Cost:$357.00 Ad No:0004429094 Customer No: 1306647 PO#: #of Affidavits1 This is not an invoice AUDIT COMMITTEE MEETING AUDITOR SELECTION Agenda Page 7 EVALUATION CRITERIA 1. Ability of Personnel. (20 Points) (E.g., geographic locations of the firm's headquarters or permanent office in relation to the project; capabilities and experience of key personnel; present ability to manage this project; evaluation of existing workload; proposed staffing levels, etc.) 2. Proposer's Experience. (20 Points) (E.g. past record and experience of the Proposer in similar projects; volume of work previously performed by the firm; past performance for other Community Development Districts in other contracts; character, integrity, reputation, of respondent, etc.) 3. Understanding of Scope of Work. (20 Points) Extent to which the proposal demonstrates an understanding of the District's needs for the services requested. 4. Ability to Furnish the Required Services. (20 Points) Extent to which the proposal demonstrates the adequacy of Proposer's financial resources and stability as a business entity necessary to complete the services required (E.g., the existence of any natural disaster plan for business operations). 5 Price. (20 Points) Points will be awarded based upon the price bid for the rendering of the services and reasonableness of the price to the services. Agenda Page 8 NAPLES HERITAGE COMMUNITY DEVELOPMENT DISTRICT PROPOSAL FOR AUDIT SERVICES PROPOSED BY: Berger, Toombs, Elam, Gaines & Frank CERTIFIED PUBLIC ACCOUNTANTS, PL 600 Citrus Avenue, Suite 200 (772) 461-6120 Fort Pierce, Florida 34950 CONTACT PERSON: J. W. Gaines, CPA, Director DATE OF PROPOSAL: October 15, 2020 Agenda Page 9 TABLE OF CONTENTS DESCRIPTION OF SECTION PAGE A. Letter of Transmittal 1-2 B. Profile of the Proposer Description and History of Audit Firm 3 Professional Staff Resources 4-5 Ability to Furnish the Required Services 5 Arbitrage Rebate Services 6 A. Governmental Auditing Experience 7-16 B. Fee Schedule 17 C. Scope of Work to be Performed 17 D. Resumes 18-33 E. Peer Review Letter 34 F. Additional Documents Required Instructions to Proposers 35-36 Agenda Page 10 c� rcr Berger, Toombs, Elam, - Gaines & Frank Certified Public Accountants PL 600 Citrus Avenue Suite 200 Fort Pierce,Florida 34950 772/461-6120//461-1155 FAX: 772/468-9278 October 15, 2020 Naples Heritage Community Development District Inframark Infrastructure Management Services 15275 Collier Blvd, #201-346 Naples, FL 34119 Dear District Manager: Thank you very much for the opportunity to present our professional credentials to provide audit services for Naples Heritage Community Development District. Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL has assembled a team of governmental and nonprofit specialists second to none to serve our clients. Our firm has the necessary qualifications and experience to serve as the independent auditors for Naples Heritage Community Development District. We will provide you with top quality, responsive service. Experience Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL is a recognized leader in providing services to governmental and nonprofit agencies throughout Florida. We have been the independent auditors for a number of local governmental agencies and through our experience in performing their audits, we have been able to increase our audit efficiency and; therefore, reduce costs. We have continually passed this cost savings on to our clients and will continue to do so in the future. As a result of our experience and expertise, we have developed an effective and efficient audit approach designed to meet or exceed the performance specifications in accordance with auditing standards generally accepted in the United States of America, the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, and the standards for financial and compliance audits. We will conduct the audit in accordance with auditing standards generally accepted in the United States of America; "Government Auditing Standards" issued by the Comptroller General of the United States; the provisions of the Single Audit Act, Subpart F of Title 2 US Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, with minimal disruption to your operations. Our firm has frequent technical updates to keep our personnel informed and up-to-date on all changes that are occurring within the industry. Fort Pierce/Stuart Member AICPA Member AICPA Division for CPA Firms Member FICPA Private Companies practice Section Agenda Page 11 diBerger,Toombs, Elam, } Gaines& Frank Ceded Public&cue.. PL Naples Heritage Community Development District October 15, 2020 Our firm is a member of the Government Audit Quality Center, an organization dedicated to improving government audit quality. We also utilize the audit program software of a nationally recognized CPA firm to assure us that we are up to date with all auditing standards and to assist us maintain maximum audit efficiencies. To facilitate your evaluation of our qualifications and experience, we have arranged this proposal to include a resume of our firm, including our available staff, our extensive prior governmental and nonprofit auditing experience and clients to be contacted. You need a firm that will provide an efficient, cost-effective, high-quality audit within critical time constraints. You need a firm with the prerequisite governmental and nonprofit experience to perform your audit according to stringent legal and regulatory requirements, a firm that understands the complex nature of community development districts and their unique compliance requirements. You need a firm with recognized governmental and nonprofit specialists within the finance and governmental communities. And, certainly, you need a firm that will provide you with valuable feedback to enhance your current and future operations. Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL is that firm. J. W. Gaines is the person authorized to make representations for the firm. Thank you again for the opportunity to submit this proposal to Naples Heritage Community Development District. Very truly yours, albt da0n66/0/PG )614:10) Aard- Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL Fort Pierce, Florida - 2 - Agenda Page 12 PROFILE OF THE PROPOSER Description and History of Audit Firm Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL is a Treasure Coast public accounting firm, which qualifies as a small business firm, as established by the Small Business Administration (13 CFR 121.38), with offices in Fort Pierce and Stuart. We are a member of the Florida Institute of Certified Public Accountants and the American Institute of Certified Public Accountants. The firm was formed from the merger of Edwards, Berger, Harris & Company (originated in 1972) and McAlpin, Curtis & Associates (originated in 1949). J. W. Gaines and Associates (originated in 1979) merged with the firm in 2004. Our tremendous growth rate experienced over the last 71 years is directly attributable to the firm's unrelenting dedication to providing the highest quality, responsive professional services attainable to its clients. We are a member of the Private Companies Practice Section (PCPS) of the American Institute of Certified Public Accountants (AICPA) to assure we meet the highest standards. Membership in this practice section requires that our firm meet more stringent standards than standard AICPA membership. These rigorous requirements include the requirement of a triennial peer review of our firm's auditing and accounting practice and annual Continuing Professional Education (CPE) for all accounting staff (whether CPA or non-CPA). For standard AICPA membership, only a quality review is required and only CPAs must meet CPE requirements. We are also a member of the Government Audit Quality Center ("the Center") of the American Institute of Certified Public Accountants to assure the quality of our government audits. Membership in the Center, which is voluntary, requires our firm to comply with additional standards to promote the quality of government audits. We have been extensively involved in serving local government entities with professional accounting, auditing and consulting services throughout the entire 71 year history of our firm. Our substantial experience over the years makes us uniquely qualified to provide accounting, auditing, and consulting services to these clients. We are a recognized leader in providing services to governmental and nonprofit agencies on the Treasure Coast and in Central and South Florida, with extensive experience in auditing community development districts and water control districts. We were the independent auditors of the City of Fort Pierce for over 37 years and currently, we are the independent auditors for St. Lucie County since 2002, and for 38 of the 72 years that the county has been audited by CPA firms. Additionally, we have performed audits of the City of Stuart, the City of Vero Beach, Indian River County and Martin County. We also presently audit over 75 Community Development Districts throughout Florida. Our firm was founded on the belief that we are better able to respond to our clients needs through education, experience, independence, quality control, and personal service. Our firm's commitment to quality is reflected in our endeavor of professional excellence via continuing education, the use of the latest computer technology, professional membership in PCPS and peer review. We believe our approach to audit engagements, intelligence and innovation teamed with sound professional judgment enables us to explore new concepts while remaining sensitive to the fundamental need for practical solutions. We take pride in giving you the assurance that the personal assistance you receive comes from years of advanced training, technical experience and financial acumen. - 3 - Agenda Page 13 Professional Staff Resources Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL has a total of 32 professional and administrative staff (including 14 professional staff with extensive experience servicing government entities). The work will be performed out of our Fort Pierce office with a proposed staff of one senior accountant and one or two staff accountants supervised by an audit manager and audit partner. With the exception of the directors of the firm's offices, the professional staff is not specifically assigned to any of our individual offices. The professional and administrative staff resources available to you through Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL are as follows: Total Partners/Directors (CPA's) 5 Principals (CPA) 1 Managers (CPA) 1 Senior/Supervisor Accountants (2 CPA's) 3 Staff Accountants (1 CPA) 9 Computer Specialist 1 Paraprofessional 8 Administrative 4 Total—all personnel 32 Following is a brief description of each employee classification: Staff Accountant — Staff accountants work directly under the constant supervision of the auditor-in-charge and, are responsible for the various testing of documents, account analysis and any other duties as his/her supervisor believes appropriate. Minimum qualification for a staff accountant is graduation from an accredited university or college with a degree in accounting or equivalent. Senior Accountant — A senior accountant must possess all the qualifications of the staff accountant, in addition to being able to draft the necessary reports and financial statements, and supervise other staff accountants when necessary. Managers — A manager must possess the qualifications of the senior accountant, plus be able to work without extensive supervision from the auditor-in-charge. The manager should be able to draft audit reports from start to finish and to supervise the audit team, if necessary. Principal — A principal is a partner/director in training. He has been a manager for several years and possesses the technical skills to act as the auditor—in-charge. A principal has no financial interest in the firm. Partner/Director — The director has extensive governmental auditing experience and acts as the auditor-in-charge. Directors have a financial interest in the firm. -4- Agenda Page 14 Professional Staff Resources (Continued) Independence — Independence of the public accounting firm, with respect to the audit client, is the foundation from which the public gains its trust in the opinion issued by the public accounting firm at the end of the audit process. This independence must be in appearance as well as in fact. The public must perceive that the accounting firm is independent of the audit entity to ensure that nothing would compromise the opinion issued by the public accounting firm. Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL is independent of Naples Heritage Community Development District, including its elected officials and related parties, at the date of this proposal, as defined by the following rules, regulations, and standards: AuSection 220 — Statements on Auditing Standards issued by the American Institute of Certified Public Accountants; ET Sections 101 and 102 — Code of Professional Conduct of the American Institute of Certified Public Accountants; Chapter 21A-1, Florida Administrative Code; Section 473.315, Florida Statutes; and, Government Auditing Standards, issued by the Comptroller General of the United States. On an annual basis, all members of the firm are required to confirm, in writing, that they have no personal or financial relationships or holding that would impair their independence with regard to the firm's clients. Independence is a hallmark of our profession. We encourage our staff to use professional judgment in situations where our independence could be impaired or the perception of a conflict of interest might exist. In the governmental sector, public perception is as important as professional standards. Therefore, the utmost care must be exercised by independent auditors in the performance of their duties. Ability to Furnish the Required Services As previously noted in the Profile of the Proposer section of this document, our firm has been in existence for over 69 years. We have provided audit services to some clients for over 30 years continually. Our firm is insured against physical loss through commercial insurance and we also carry liability insurance. The majority of our audit documentation is stored electronically, both on our office network and on each employee laptop or computer assigned to each specific job. Our office computer network is backed up on tape, so in the event of a total equipment loss, we can restore all data as soon as replacement equipment is acquired. In addition, our field laptop computers carry the same data and can be used in the event of emergency with virtually no delay in completing the required services. - 5- Agenda Page 15 ADDITIONAL SERVICES PROVIDED Arbitrage Rebate Services Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL also provides arbitrage rebate compliance and related services to governmental issuers. The Tax Reform Act of 1986 requires issuers of most tax-exempt obligations to pay (i.e., "rebate") to the United States government any arbitrage profits. Arbitrage profits are earnings on the investment of bond proceeds and certain other monies in excess of what would have been earned had such monies been invested at a yield equal to the yield on the bonds. Federal tax law requires that interim rebate calculations and payments are due at the end of every fifth bond year. Final payment is required upon redemption of the bonds. More frequent calculations may be deemed advisable by an issuer's auditor, trustee or bond counsel or to assure that accurate and current records are available. These more frequent requirements are usually contained in the Arbitrage or Rebate Certificate with respect to the bonds. Our firm performs a comprehensive rebate analysis and includes the following: • Verifying that the issue is subject to rebate; • Calculating the bond yield; • Identifying, and separately accounting for, all "Gross Proceeds" (as that term is defined in the Code) of the bond issue, including those requiring analysis due to "transferred proceeds" and/or"commingled funds" circumstances; • Determining what general and/or elective options are available to Gross proceeds of the issue; • Calculating the issue's excess investment earning (rebate liability), if any; • Delivering appropriate documentation to support all calculations; • Providing an executive summary identifying the methodology employed, major assumptions, conclusions, and any other recommendations for changes in recordkeeping and investment policies; • Assisting as necessary in the event of an Internal Revenue Service inquiry; and, • Consulting with issue staff, as necessary, regarding arbitrage related matters. - 6- Agenda Page 16 GOVERNMENTAL AUDITING EXPERIENCE Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL has been practicing public accounting in Florida for 69 years. Our success over the years has been the result of a strong commitment to providing personalized quality service to our clients. The current members of our firm have performed audits of over 900 community development districts, and over 1,800 audits of municipalities, counties and other governmental entities such as the City of Fort Pierce and St. Lucie County. Our firm provides a variety of accounting, auditing, tax litigation support, and consulting services. Some of the professional accounting, auditing and management consulting services that are provided by our firm are listed below: • Performance of annual financial and compliance audits, including Single Audits of state and federal financial assistance programs, under the provisions of the Single Audit Act, Subpart F of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), with minimal disruptions to your operations; • Performance of special compliance audits to ascertain compliance with the applicable local, state and federal laws and regulations; • Issuance of comfort letters and consent letters in conjunction with the issuance of tax- exempt debt obligations, including compiling financial data and interim period financial statement reviews; • Calculation of estimated and actual federal arbitrage rebates; • Assistance in compiling historical financial data for first-time and supplemental submissions for GFOA Certificate of Achievement for Excellence in Financial Reporting; • Preparation of indirect cost allocation systems in accordance with Federal and State regulatory requirements; • Providing human resource and employee benefit consulting; • Performance of automation feasibility studies and disaster recovery plans; • Performance feasibility studies concerning major fixed asset acquisitions and utility plant expansion plans (including electric, water, pollution control, and sanitation utilities); and • Assistance in litigation, including testimony in civil and criminal court. • Assist clients who utilize QuickBooks software with their software needs. Our Certified QuickBooks Advisor has undergone extensive training through QuickBooks and has passed several exams to attain this Certification. Continuing Professional Education All members of the governmental audit staff of our firm, and audit team members assigned to this engagement, are in compliance with the Continuing Professional Education (CPE) requirements set forth in Government Auditing Standards issued by the Comptroller General of the United States. In addition, our firm is in compliance with the applicable provisions of the Florida Statutes that require CPA's to have met certain CPE requirements prior to proposing on governmental audit engagements. - 7- Agenda Page 17 GOVERNMENTAL AUDITING EXPERIENCE (CONTINUED) The audit team has extensive experience in performing governmental audits and is exposed to intensive and continuing concentration on these types of audits. Due to the total number of governmental audits our team performs, each member of our governmental staff must understand and be able to perform several types of governmental audits. It is our objective to provide each professional employee fifty hours or more of comprehensive continuing professional education each year. This is accomplished through attending seminars throughout Florida and is reinforced through in-house training. Our firm has made a steadfast commitment to professional education. Our active attendance and participation in continuing professional education is a major part of our objective to obtain the most recent knowledge on issues which are of importance to our clients. We are growing on the reputation for work that our firm is providing today. Quality Control Program Quality control requires continuing commitment to professional excellence. Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants, PL is formally dedicated to that commitment. To ensure maintaining the standards of working excellence required by our firm, we joined the Private Companies Practice Section (PCPS) of the American Institute of Certified Public Accountants (AICPA). To be a participating member firm of this practice section, a firm must obtain an independent Peer Review of its quality control policies and procedures to ascertain the firm's compliance with existing auditing standards on the applicable engagements. The scope of the Peer Review is comprehensive in that it specifically reviews the following quality control policies and procedures of the participating firm: • Professional, economic, and administrative independence; • Assignment of professional personnel to engagements; • Consultation on technical matters; • Supervision of engagement personnel; • Hiring and employment of personnel; • Professional development; • Advancement; • Acceptance and continuation of clients; and, • Inspection and review system. We believe that our commitment to the program is rewarding not only to our firm, but primarily to our clients. The external independent Peer Review of the elements of our quality control policies and procedures performed by an independent certified public accountant, approved by the PCPS of the AICPA, provides you with the assurance that we continue to conform to standards of the profession in the conduct of our accounting and auditing practice. - 8 - Agenda Page 18 GOVERNMENTAL AUDITING EXPERIENCE (CONTINUED) Our firm is also a member of Governmental Audit Quality Center (GAQC), a voluntary membership center for CPA firms that perform governmental audits. This center promotes the quality of governmental audits. Our firm has completed successive Peer Reviews. These reviews included a representative sample of our firm's local governmental auditing engagements. As a result of these reviews, our firm obtained an unqualified opinion on our quality control program and work procedures. On page 31 is a copy of our most recent Peer Review report. It should be noted that we received a pass rating. Our firm has never had any disciplinary actions by state regulatory bodies or professional organizations. As our firm performs approximately one hundred fifty audits each year that are reviewed by federal, state or local entities, we are constantly dealing with questions from these entities about our audits. We are pleased to say that any questions that have been raised were minor issues and were easily resolved without re-issuing any reports. Certificate of Achievement for Excellence in Financial Reporting (CAFR) We are proud and honored to have been involved with the City of Fort Pierce and the Fort Pierce Utilities Authority when they received their first Certificates of Achievement for Excellence in Financial Reporting for the fiscal years ended September 30, 1988 and 1994, respectively. We were also instrumental in the City of Stuart receiving the award, in our first year of performing their audit, for the year ended September 30, 1999. We also assisted St. Lucie County, Florida for the year ended September 30, 2003, in preparing their first Comprehensive Annual Financial Report, and St. Lucie County has received their Certificate of Achievement for Excellence in Financial Reporting every year since. As continued commitment to insuring that we are providing the highest level of experience, we have had at least one employee of our firm serve on the GFOA — Special Review Committee since the mid-1980s. This committee is made up of selective Certified Public Accountants throughout the United States who have demonstrated their high level of knowledge and expertise in governmental accounting. Each committee member attends a special review meeting at the Annual GFOA Conference. At this meeting, the committee reports on the Certificate of Achievement Program's most recent results, future goals, and common reporting deficiencies. We feel that our previous experience in assisting the City of Fort Pierce, the Fort Pierce Utilities Authority and St. Lucie County obtain their first CAFRs, and the City of Stuart in continuing to receive a CAFR and our firm's continued involvement with the GFOA, and the CAFR review committee make us a valued asset for any client in the field of governmental financial reporting. - 9 - Agenda Page 19 GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) References Terracina Community Development Gateway Community Development District District Jeff Walker, Special District Services Stephen Bloom, Severn Trent Management (561) 630-4922 (954) 753-5841 The Reserve Community Development District Port of the Islands Community Development District Darrin Mossing, Governmental Management Cal Teague, Premier District Management Services LLC (407) 841-5524 (239) 690-7100 ext 101 In addition to the above, we have the following additional governmental audit experience: Community Development Districts Aberdeen Community Development Beacon Lakes Community District Development District Alta Lakes Community Development Beaumont Community Development District District Amelia Concourse Community Bella Collina Community Development Development District District Amelia Walk Communnity Bonnet Creek Community Development District Development District Aqua One Community Development Buckeye Park Community District Development District Arborwood Community Development Candler Hills East Community District Development District Arlington Ridge Community Cedar Hammock Community Development District Development District Bartram Springs Community Central Lake Community Development District Development District Baytree Community Development Channing Park Community District Development District - 10- Agenda Page 20 GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Cheval West Community Evergreen Community Development Development District District Coconut Cay Community Forest Brooke Community Development District Development District Colonial Country Club Community Gateway Services Community Development District Development District Connerton West Community Gramercy Farms Community Development District Development District Copperstone Community Greenway Improvement District Development District Creekside @ Twin Creeks Community Greyhawk Landing Community Development District Development District Deer Run Community Development Griffin Lakes Community Development District District Dowden West Community Habitat Community Development Development District District DP1 Community Development Harbor Bay Community Development District District Eagle Point Community Development Harbourage at Braden River District Community Development District East Nassau Stewardship District Harmony Community Development District Eastlake Oaks Community Development District Harmony West Community Development District Easton Park Community Development District Harrison Ranch Community Development District Estancia @ Wiregrass Community Development District Hawkstone Community Development District - 11 - Agenda Page 21 GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Heritage Harbor Community Madeira Community Development Development District District Heritage Isles Community Marhsall Creek Community Development District Development District Heritage Lake Park Community Meadow Pointe IV Community Development District Development District Heritage Landing Community Meadow View at Twin Creek Development District Community Development District Heritage Palms Community Mediterra North Community Development District Development District Heron Isles Community Midtown Miami Community Development District Development District Heron Isles Community Development Mira Lago West Community District Development District Highland Meadows II Community Montecito Community Development District Development District Julington Creek Community Narcoossee Community Development District Development District Laguna Lakes Community Naturewalk Community Development District Development District Lake Bernadette Community New Port Tampa Bay Community Development District Development District Lakeside Plantation Community Overoaks Community Development Development District District Landings at Miami Community Panther Trace II Community Development District Development District Legends Bay Community Paseo Community Development Development District District Lexington Oaks Community Pine Ridge Plantation Community Development District Development District Live Oak No. 2 Community Piney Z Community Development Development District District - 12 - Agenda Page 22 GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Poinciana Community Sampson Creek Community Development District Development District Poinciana West Community San Simeon Community Development District Development District Port of the Islands Community Six Mile Creek Community Development District Development District Portofino Isles Community South Village Community Development District Development District Quarry Community Development Southern Hills Plantation I District Community Development District Renaissance Commons Community Southern Hills Plantation III Development District Community Development District Reserve Community South Fork Community Development District Development District Reserve#2 Community St. John's Forest Community Development District Development District River Glen Community Stoneybrook South Community Development District Development District River Hall Community Stoneybrook South at ChampionsGate Development District Community Development District River Place on the St. Lucie Stoneybrook West Community Community Development District Development District Rivers Edge Community Tern Bay Community Development District Development District Riverwood Community Terracina Community Development Development District District Riverwood Estates Community Tison's Landing Community Development District Development District Rolling Hills Community TPOST Community Development Development District District Rolling Oaks Community Development District - 13 - Agenda Page 23 GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Triple Creek Community Vizcaya in Kendall Development District Development District TSR Community Development Waterset North Community District Development District Turnbull Creek Community Westside Community Development Development District District Twin Creeks North Community WildBlue Community Development Development District District Urban Orlando Community Willow Creek Community Development District Development District Verano#2 Community Willow Hammock Community Development District Development District Viera East Community Winston Trails Community Development District Development District VillaMar Community Zephyr Ridge Community Development District Development District - 14 - Agenda Page 24 GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Other Governmental Organizations City of Westlake Office of the Medical Examiner, District 19 Florida Inland Navigation District Rupert J. Smith Law Library of St. Lucie County Fort Pierce Farms Water Control District St. Lucie Education Foundation Indian River Regional Crime Seminole Improvement District Laboratory, District 19, Florida Troup Indiantown Water Viera Stewardship District Control District Current or Recent Single Audits, St. Lucie County, Florida Gateway Services Community Development Early Learning Coalition, Inc. District Treasure Coast Food Bank, Inc. Members of our audit team have acquired extensive experience from performing or participating in over 2,100 audits of governments, independent special taxing districts, school boards, and other agencies that receive public money and utilize fund accounting. Much of our firm's auditing experience is with compliance auditing, which is required for publicly financed agencies. In this type of audit, we do a financial examination and also confirm compliance with various statutory and regulatory guidelines. Following is a summary of our other experience, including Auditor General experience, as it pertains to other governmental and fund accounting audits. Counties (Includes elected constitutional officers, utilities and dependent taxing districts) Indian River Martin Okeechobee Palm Beach Municipalities City of Port St. Lucie City of Vero Beach Town of Orchid - 15 - Agenda Page 25 GOVERNMENTAL AUDIT EXPERIENCE (CONTINUED) Special Districts Bannon Lakes Community Development District Boggy Creek Community Development District Capron Trail Community Development District Celebration Pointe Community Development District Coquina Water Control District Diamond Hill Community Development District Dovera Community Development District Durbin Crossing Community Development District Golden Lakes Community Development District Lakewood Ranch Community Development District Martin Soil and Water Conservation District Meadow Pointe III Community Development District Myrtle Creek Community Development District St. Lucie County— Fort Pierce Fire District The Crossings at Fleming Island St. Lucie West Services District Indian River County Mosquito Control District St. John's Water Control District Westchase and Westchase East Community Development Districts Pier Park Community Development District Verandahs Community Development District Magnolia Park Community Development District Schools and Colleges Federal Student Aid Programs— Indian River Community College Indian River Community College Okeechobee County District School Board St. Lucie County District School Board State and County Agencies Central Florida Foreign-Trade Zone, Inc. (a nonprofit organization affiliated with the St. Lucie County Board of County Commissioners) Florida School for Boys at Okeechobee Indian River Community College Crime Laboratory Indian River Correctional Institution - 16 - Agenda Page 26 FEE SCHEDULE We propose the fee for our audit services described below to be $3,150 for the years ended September 30, 2020, 2021, and 2022. The fee is contingent upon the financial records and accounting systems of Naples Heritage Community Development District being "audit ready" and the financial activity for the District is not materially increased. If we discover that additional preparation work or subsidiary schedules are needed, we will consult with your authorized representative. We can assist with this additional work at our standard rates should you desire. SCOPE OF WORK TO BE PERFORMED If selected as the District's auditors, we will perform a financial and compliance audit in accordance with Section 11.45, Florida Statutes, in order to express an opinion on an annual basis on the financial statements of Naples Heritage Community Development District as of September 30, 2020, 2021, and 2022. The audits will be performed to the extent necessary to express an opinion on the fairness in all material respects with which the financial statements present the financial position, results of operations and changes in financial position in conformity with generally accepted accounting principles and to determine whether, for selected transactions, operations are properly conducted in accordance with legal and regulatory requirements. Reportable conditions that are also material weaknesses shall be identified as such in the Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters. Other (non-reportable) conditions discovered during the course of the audit will be reported in a separate letter to management, which will be referred to in the Auditors' Report on Internal Control over Financial Reporting and on Compliance and Other Matters. Our audit will be performed in accordance with standards for financial and compliance audits contained in Government Auditing Standards, as well as in compliance with rules and regulations of audits of special districts as set forth by the State Auditor General in Chapter 10.550, Local Governmental Entity Audits, and other relevant federal, state and county orders, statutes, ordinances, charter, resolutions, bond covenants, Administrative Code and procedures, or rules and regulations which may pertain to the work required in the engagement. The primary purpose of our audit will be to express an opinion on the financial statements discussed above. It should be noted that such audits are subject to the inherent risk that errors or irregularities may not be detected. However, if conditions are discovered which lead to the belief that material errors, defalcations or other irregularities may exist or if other circumstances are encountered that require extended services, we will promptly notify the appropriate individual. - 17 - Agenda Page 27 Commitment to Quality Service Personnel Qualifications and Experience J. W. Gaines, CPA, CITP Director—41 years Education • Stetson University, B.B.A. —Accounting Registrations • Certified Public Accountant—State of Florida, State Board of Accountancy • Certified Information Technology Professional (CITP) —American Institute of Certified Public Accountants Professional Affiliations/Community Service • Member of the American and Florida Institutes of Certified Public Accountants • Affiliate member Government Finance Officers Association • Past President, Vice President-Campaign Chairman, Vice President and Board Member of United Way of St. Lucie County, 1989 - 1994 • Past President, President Elect, Secretary and Treasurer of the Treasure Coast Chapter of the Florida Institute of Certified Public Accountants, 1988 - 1991 • Past President of Ft. Pierce Kiwanis Club, 1994 - 95, Member/Board Member since 1982 • Past President, Vice President and Treasurer of St. Lucie County Chapter of the American Cancer Society, 1980 -1986 • Member of the St. Lucie County Chamber of Commerce, Member Board of Directors, Treasurer, September 2002 - 2006, Chairman Elect 2007, Chairman 2008, Past Chairman 2009 • Member Lawnwood Regional Medical Center Board of Trustees, 2000 — Present, Chairman 2013 - Present • Member of St. Lucie County Citizens Budget Committee, 2001 —2002 • Member of Ft. Pierce Citizens Budget Advisory Committee, 2010—2011 • Member of Ft. Pierce Civil Service Appeals Board, 2013 - Present Professional Experience • Miles Grant Development/Country Club— Stuart, Florida, July 1975—October 1976 • State Auditor General's Office — Public Accounts Auditor — November 1976 through September 1979 • Director - Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants PL, responsible for numerous government and nonprofit audits. • Over 30 years experience in all phases of public accounting and auditing experience, with a concentration in financial and compliance audits. Mr. Gaines has been involved in all phases of the audits listed on the preceding pages. - 18- Agenda Page 28 Commitment to Quality Service Personnel Qualifications and Experience J. W. Gaines, CPA, CITP (Continued) Director Continuing Professional Education • Has participated in numerous continuing professional education courses provided by nationally recognized sponsors over the last two years to keep abreast of the latest developments in accounting and auditing such as: Governmental Accounting Report and Audit Update Analytical Procedures, FICPA Annual Update for Accountants and Auditors Single Audit Sampling and Other Considerations - 19 - Agenda Page 29 Commitment to Quality Service Personnel Qualifications and Experience David S. McGuire, CPA, CITP Accounting and Audit Principal— 12 years Accounting and Audit Manager—4 years Staff Accountant — 11 years Education • University of Central Florida, B.A. —Accounting • Barry University— Master of Professional Accountancy Registrations • Certified Public Accountant—State of Florida, State Board of Accountancy • Certified Information Technology Professional (CITP) —American Institute of Certified Public Accountants • Certified Not-For-Profit Core Concepts 2018 Professional Affiliations/Community Service • Member of the American and Florida Institutes of Certified Public Accountants • Associate Member, Florida Government Finance Office Associates • Assistant Coach —St. Lucie County Youth Football Organization (1994—2005) • Assistant Coach —Greater Port St. Lucie Football League, Inc. (2006—2010) • Board Member—Greater Port St. Lucie Football League, Inc. (2011 — present) • Treasurer, AIDS Research and Treatment Center of the Treasure Coast, Inc. (2000 — 2003) • Board Member/Treasurer, North Treasure Coast Chapter, American Red Cross (2004 —2010) • Member/Board Member of Port St. Lucie Kiwanis (1994—2001) • President (2014/15) of Sunrise Kiwanis of Fort Pierce (2004— present) • St. Lucie District School Board Superintendent Search Committee (2013— present) Professional Experience • Twenty-four years public accounting experience with an emphasis on nonprofit and governmental organizations. • Audit Manager in-charge on a variety of audit and review engagements within several industries, including the following government and nonprofit organizations: St. Lucie County, Florida 19th Circuit Office of Medical Examiner Troup Indiantown Water Control District Exchange Club Center for the Prevention of Child Abuse, Inc. Healthy Kids of St. Lucie County Mustard Seed Ministries of Ft. Pierce, Inc. Reaching Our Community Kids, Inc. Reaching Our Community Kids - South St. Lucie County Education Foundation, Inc. Treasure Coast Food Bank, Inc. North Springs Improvement District • Four years of service in the United States Air Force in computer operations, with a top secret (SCl/SBI) security clearance. - 20 - Agenda Page 30 Commitment to Quality Service Personnel Qualifications and Experience David S. McGuire, CPA, CITP (Continued) Accounting and Audit Principal Continuing Professional Education • Mr. McGuire has attended numerous continuing professional education courses and seminars taught by nationally recognized sponsors in the accounting auditing and single audit compliance areas. He has attended courses over the last two years in those areas as follows: Not-for-Profit Auditing Financial Results and Compliance Requirements Update: Government Accounting Reporting and Auditing Annual Update for Accountants and Auditors - 21 - Agenda Page 31 Commitment to Quality Service Personnel Qualifications and Experience David F. Haughton, CPA Accounting and Audit Manager—30 years Education • Stetson University, B.B.A. —Accounting Registrations • Certified Public Accountant—State of Florida, State Board of Accountancy Professional Affiliations/Community Service • Member of the American and Florida Institutes of Certified Public Accountants • Former Member of Florida Institute of Certified Public Accountants Committee on State and Local Government • Affiliate Member Government Finance Officers Association (GFOA) for over 10 years • Affiliate Member Florida Government Finance Officers Association (FGFOA) for over 10 years • Technical Review— 1997 FICPA Course on State and Local Governments in Florida • Board of Directors — Kiwanis of Ft. Pierce, Treasurer — 1994-1999; Vice President — 1999- 2001 Professional Experience • Twenty-seven years public accounting experience with an emphasis on governmental and nonprofit organizations. • State Auditor General's Office — West Palm Beach, Staff Auditor, June 1985 to September 1985 • Accounting and Audit Manager of Berger, Toombs, Elam, Gaines & Frank, Certified Public Accountants PL, responsible for audit and accounting services including governmental and not-for-profit audits. • Over 20 years of public accounting and governmental experience, specializing in governmental and nonprofit organizations with concentration in special districts, including Community Development Districts which provide services including water and sewer utilities. Governmental and non-profit entities served include the following: Counties: St. Lucie County Municipalities: City of Fort Pierce City of Stuart - 22 - Agenda Page 32 Commitment to Quality Service Personnel Qualifications and Experience David F. Haughton, CPA (Continued) Accounting and Audit Manager Professional Experience (Continued) Special Districts: Bluewaters Community Development District Country Club of Mount Dora Community Development District Fiddler's Creek Community Development District#1 and #2 Indigo Community Development District North Springs Improvement District Renaissance Commons Community Development District St. Lucie West Services District Stoneybrook Community Development District Summerville Community Development District Terracina Community Development District Thousand Oaks Community Development District Tree Island Estates Community Development District Valencia Acres Community Development District Non-Profits: The Dunbar Center, Inc. Hibiscus Children's Foundation, Inc. Hope Rural School, Inc. Maritime and Yachting Museum of Florida, Inc. Tykes and Teens, Inc. United Way of Martin County, Inc. Workforce Development Board of the Treasure Coast, Inc. • While with the Auditor General's Office he was on the staff for the state audits of the Martin County School District and Okeechobee County School District. • During 1997 he performed a technical review of the Florida Institute of Certified Public Accountants state CPE course on Audits of State and Local Governments in Florida. His comments were well received by the author and were utilized in future updates to the course. Continuing Professional Education • During the past several years, he has participated in numerous professional development training programs sponsored by the AICPA and FICPA, including state conferences on special districts and governmental auditing in Florida. He averages in excess of 100 hours bi-annually of advanced training which exceeds the 80 hours required in accordance with the continuing professional education requirements of the Florida State Board of accountancy and the AICPA Private Companies Practice Section. He has over 75 hours of governmental CPE credit within the past two years. - 23 - Agenda Page 33 Commitment to Quality Service Personnel Qualifications and Experience Matthew Gonano, CPA Senior Staff Accountant— 10 years Education • University of North Florida, B.B.A. —Accounting • University of Alicante, Spain — International Business • Florida Atlantic University —Masters of Accounting Professional Affiliations/Community Service • American Institute of Certified Public Accountants • Florida Institute of Certified Public Accountants Professional Experience • Senior Accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. • Performed audits of nonprofit and governmental organizations in accordance with Governmental Accounting Auditing Standards (GAAS) • Performed Single Audits of nonprofit organizations in accordance with OMB Circular A-133, Audits of State, Local Governments, and Non-Profit Organizations. Continuing Professional Education • Mr. Gonano has participated in numerous continuing professional education courses. - 24 - Agenda Page 34 Commitment to Quality Service Personnel Qualifications and Experience Paul Daly Staff Accountant—9 years Education ♦ Florida Atlantic University, B.S. —Accounting Professional Experience ♦ Staff Accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Working to attain the requirements to take the Certified Public Accounting (CPA) exam. - 25 - Agenda Page 35 Commitment to Quality Service Personnel Qualifications and Experience Melissa Marlin Senior Staff Accountant—7 years Education • Indian River State College, A.A. —Accounting • Florida Atlantic University, B.B.A. —Accounting Professional Experience • Staff accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Mrs. Marlin participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. • Mrs. Marlin is currently studying to pass the CPA exam. - 26 - Agenda Page 36 Commitment to Quality Service Personnel Qualifications and Experience Bryan Snyder Staff Accountant— 5 years Education • Florida Atlantic University, B.B.A. —Accounting Professional Experience • Accountant beginning his professional auditing career with Berger, Toombs, Elam, Gaines, & Frank. • Mr. Snyder is gaining experience auditing governmental & nonprofit entities. Continuing Professional Education • Mr. Snyder participates in numerous continuing education courses and plans on working to acquire his CPA certificate. • Mr. Snyder is currently studying to pass the CPA exam. - 27- Agenda Page 37 Commitment to Quality Service Personnel Qualifications and Experience Maritza Stonebraker Staff Accountant—4 years Education ♦ Indian River State College, B.S.A. —Accounting Professional Experience • Staff Accountant beginning her professional auditing career with Berger, Toombs, Elam, Gaines, & Frank. Continuing Professional Education • Mrs. Stonebraker participates in numerous continuing education courses and plans on acquiring her CPA. ♦ Mrs. Stonebraker is currently studying to pass the CPA exam. - 28 - Agenda Page 38 Commitment to Quality Service Personnel Qualifications and Experience Jonathan Herman, CPA Senior Staff Accountant—7 years Education ♦ University of Central Florida, B.S. —Accounting ♦ Florida Atlantic University, MACC Professional Experience ♦ Accounting graduate with five years experience with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Mr. Herman participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. - 29- Agenda Page 39 Commitment to Quality Service Personnel Qualifications and Experience Sean Stanton, CPA Staff Accountant—4 years Education • University of South Florida, B.S. —Accounting • Florida Atlantic University, M.B.A. —Accounting Professional Experience • Staff accountant with Berger, Toombs, Elam, Gaines, & Frank auditing governmental and non-profit entities. Continuing Professional Education • Mr. Stanton participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. - 30- Agenda Page 40 Commitment to Quality Service Personnel Qualifications and Experience Taylor Nuccio Staff Accountant—3 years Education ♦ Indian River State College, B.S.A. —Accounting Professional Experience • Staff Accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Ms. Nuccio participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. • Ms. Nuccio is currently working towards completing an additional 30 hours of education to qualify to sit for CPA exam. - 31 - Agenda Page 41 Commitment to Quality Service Personnel Qualifications and Experience Kirk Vasser Staff Accountant— 1 year Education • Indian River State College, B.S.A. —Accounting Professional Experience • Staff Accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Mr. Vasser participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. • Mr. Vasser is currently working towards completing an additional 30 hours of education to qualify to sit for CPA exam. - 32 - Agenda Page 42 Commitment to Quality Service Personnel Qualifications and Experience Madison Ballash Staff Accountant— 1 year Education ♦ Indian River State College, B.S.A. —Accounting (May 2020) Professional Experience • Staff Accountant with Berger, Toombs, Elam, Gaines, & Frank providing professional services to nonprofit and governmental entities. Continuing Professional Education • Ms. Ballash participates in numerous continuing professional education courses provided by nationally recognized sponsors to keep abreast of the latest developments. • Ms. Ballash is currently working towards completing an additional 30 hours of education to qualify to sit for CPA exam. - 33 - Agenda Page 43 IMBAGGETT Judson B.Baggett 6815 Doiry Road MBA,CPA,CVA,Partner Zephyrhills,FL 33542 REUTIMANN Marci Reutimann °a (813)788-2155 CPA,Partner (813)782-8606 &ASSOCIATES,CPAS. PA Report on the Firm's System of Quality Control To the Partners October 30,2019 Berger,Toombs,Elam,Gaines&Frank,CPAs,PL and the Peer Review Committee of the Florida Institute of Certified Public Accountants We have reviewed the system of quality control for the accounting and auditing practice of Berger,Toombs, Elam,Gaines&Frank, CPAs, PL, (the firm),in effect for the year ended May 31, 2019.Our peer review was conducted in accordance with the Standards for Performing and Reporting on Peer Reviews established by the Peer Review Board of the American Institute of Certified Public Accountants(Standards). A summary of the nature, objectives, scope, limitations of, and the procedures performed in a System Review as described in the Standards may be found at aicpa.org/prsummary.The summary also includes an explanation of how engagements identified as not performed or reported in conformity with applicable professional standards,if any,are evaluated by a peer reviewer to determine a peer review rating. Firm's Responsibility The firm is responsible for designing a system of quality control and complying with it to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. The firm is also responsible for evaluating actions to promptly remediate engagements deemed as not performed or reported in conformity with professional standards, when appropriate,and for remediating weaknesses in its system of quality control,if any. Peer Reviewer's Responsibility Our responsibility is to express an opinion on the design of the system of quality control, and the firm's compliance therewith based on our review. Required Selections and Considerations Engagements selected for review included engagements performed under Government Auditing Standards,including a compliance audit under the Single Audit Act. As a part of our peer review,we considered reviews by regulatory entities as communicated by the firm,if applicable,in determining the nature and extent of our procedures. Opinion In our opinion, the system of quality control for the accounting and auditing practice of Berger,Toombs, Elam,Gaines&Frank,CPAs, PL, in effect for the year ended May 31,2019, has been suitably designed and complied with to provide the firm with reasonable assurance of performing and reporting in conformity with applicable professional standards in all material respects. Firms can receive a rating of pass,pass with deficiency(ies), or fail. Berger, Toombs, Elam, Gaines&Frank, CPAs, PL has received a peer review rating of pass. C AD az,, CiAs. PA BAGG REI:TIMAri&ASSOCIATES,,CPAs,PA 11111111111111111110111 Member American Institute of Certified Public Accountants(AICPA)and Florida Institute of Certified Public Accountants(FICPA) National Association of Certified Valuation Analysts(NACVA) - 34 - Agenda Page 44 NAPLES HERITAGE COMMUNITY DEVELOPMENT DISTRICT REQUEST FOR PROPOSALS District Auditing Services for Fiscal Year 2020 Collier County, Florida INSTRUCTIONS TO PROPOSERS SECTION 1. DUE DATE. Sealed proposals must be received no later than 5:00 p.m. on Thursday, October 15, 2020, at the Offices of the Inframark Infrastructure Management Services, Attention: Justin Faircloth, located at 15275 Collier Blvd. #201-346, Naples, FL 34119, Phone (239)785-0675. Proposals will be publicly opened at that time. SECTION 2. FAMILIARITY WITH THE LAW. By submitting a proposal, the Proposer is assumed to be familiar with all federal, state and local laws, ordinances, rules and regulations that in any manner affect the work. Ignorance on the part of the Proposer will in no way relieve it from responsibility to perform the work covered by the proposal in compliance with all such laws, ordinances and regulations. SECTION 3. QUALIFICATIONS OF PROPOSER. The contract, if awarded, will only be awarded to a responsible Proposer who is qualified by experience and licensing to do the work specified herein. The Proposer shall submit with its proposal satisfactory evidence of experience in similar work and show that it is fully prepared to complete the work to the satisfaction of the District. SECTION 4. SUBMISSION OF ONLY ONE PROPOSAL. Proposers shall be disqualified and their proposals rejected if the District has reason to believe that collusion may exist among the Proposers, the Proposer has defaulted on any previous contract or is in arrears on any previous or existing contract, or for failure to demonstrate proper licensure and business organization. SECTION 5. SUBMISSION OF PROPOSAL. Submit seven (7) copies of the Proposal Documents and an electronic version on a flash drive, and other requested attachments at the time and place indicated herein, which shall be enclosed in an opaque sealed envelope, marked with the title "Auditing Services — Naples Heritage Community Development District" on the face of it. SECTION 6. MODIFICATION AND WITHDRAWAL. Proposals may be modified or withdrawn by an appropriate document duly executed and delivered to the place where proposals are to be submitted at any time prior to the time and date the proposals are due. No proposal may be withdrawn after opening for a period of ninety (90) days. SECTION 7. PROPOSAL DOCUMENTS. The proposal documents shall consist of the notice announcing the request for proposals, these instructions, the Evaluation Criteria Sheet and a proposal with all required documentation pursuant to Section 12 of these instructions (the "Proposal Documents"). SECTION 8. PROPOSAL. In making its proposal, each Proposer represents that it has read and understands the Proposal Documents and that the proposal is made in accordance therewith. - 35 - Agenda Page 45 SECTION 9. BASIS OF AWARD/RIGHT TO REJECT. The District reserves the right to reject any and all proposals, make modifications to the work, and waive any informalities or irregularities in proposals as it is deemed in the best interests of the District. SECTION 10. CONTRACT AWARD. Within fourteen (14) days of receipt of the Notice of Award from the District, the Proposer shall enter into and execute a Contract (Engagement Letter) with the District. SECTION 11. LIMITATION OF LIABILITY. Nothing herein shall be construed as or constitute a waiver of District's limited waiver of liability contained in Section 768.28, Florida Statutes, or any other statute or law. SECTION 12. MISCELLANEOUS. All proposals shall include the following information in addition to any other requirements of the proposal documents. A. List position or title of all personnel to perform work on the District audit. Include resumes for each person listed; list years of experience in present position for each party listed and years of related experience. B. Describe proposed staffing levels, including resumes with applicable certifications. C. Three references from projects of similar size and scope. The Proposer should include information relating to the work it conducted for each reference as well as a name, address and phone number of a contact person. D. The lump sum cost of the provision of the services under the proposal. E. Must perform the audit fieldwork at the office where the District records are maintained. SECTION 13. PROTESTS. Any protest regarding the Proposal Documents, must be filed in writing, at the Offices of the District Manager, within seventy-two (72) hours after the receipt of the proposed contract documents. The formal protest setting forth with particularity the facts and law upon which the protest is based shall be filed within seven (7) calendar days after the initial notice of protest was filed. Failure to timely file a notice of protest or failure to timely file a formal written protest shall constitute a waiver of any right to object or protest with respect to the Proposal Documents. SECTION 14. EVALUATION OF PROPOSALS. The criteria to be used in the evaluation of proposals are presented in the Evaluation Criteria Sheet, contained within the Proposal Documents. - 36 - Agenda Page 46 IiGraze & Associates (;F: fl IF'II:I) I'UBI.I(; �Ct;OUN' AN1S /� S ir Proposal to Provide Financial Auditing Services: NAPLES HERITAGE COMMUNITY DEVELOPMENT DISTRICT Proposal Due: October 15, 2020 5:00PM Submitted to: Naples Heritage Community Development District c/o Justin Faircloth 15275 Collier Blvd. #201-346 Naples, FL 34119 Submitted by: Antonio J. Grau, Partner Grau &Associates 951 Yamato Road, Suite 280 Boca Raton, Florida 33431 Tel (561) 994-9299 (800) 229-4728 Fax (561) 994-5823 tgrau@graucpa.com www.graucpa.com Agenda Page 47 Grau & Associates CERTIFIED PUBLIC ACCOUNTANTS Table of Contents PAGE EXECUTIVE SUMMARY/TRANSMITTAL LETTER 1 FIRM QUALIFICATIONS 3 FIRM &STAFF EXPERIENCE 6 REFERENCES 11 SPECIFIC AUDIT APPROACH 13 COST OF SERVICES 17 SUPPLEMENTAL INFORMATION 19 Agenda Page 48 ir Grau & Associates CERTIFIED PUBLIC ACCOUNTANTS _} October 15,2020 Naples Heritage Community Development District c/o Justin Faircloth 15275 Collier Blvd.#201-346 Naples,FL 34119 Re: Request for Proposal for Professional Auditing Services for the fiscal year ended September 30, 2020,with an option for two(2)additional annual renewals. Grau & Associates (Grau) welcomes the opportunity to respond to the Naples Heritage Community Development District's (the "District") Request for Proposal (RFP), and we look forward to continuing working with you on your audit.We are an energetic and robust team of knowledgeable professionals and are a recognized leader of providing services to Community Development Districts.As one of Florida's few firms to primarily focus on government,we are especially equipped to provide you an effective and efficient audit. Special district audits are at the core of our practice:we have a total of 360 clients,329 or 91%of which are special districts.We know the specifics of the professional services and work products needed to meet your RFP requirements like no other firm.With this level of experience,we are able to increase efficiency, to provide immediate and continued savings,and to minimize disturbances to client operations. Why Grau&Associates: Knowledgeable Audit Team Grau is proud that the personnel we assign to your audit are some of the most seasoned auditors in the field. Our staff performs governmental engagements year round.When not working on your audit,your team is refining their audit approach for next year's audit. Our engagement partners have decades of experience and take a hands-on approach to our assignments,which all ensures a smoother process for you. Servicing your Individual Needs Our clients enjoy personalized service designed to satisfy their unique needs and requirements. Throughout the process of our audit,you will find that we welcome working with you to resolve any issues as swiftly and easily as possible. In addition, due to Grau's very low turnover rate for our industry,you also won't have to worry about retraining your auditors from year to year. Developing Relationships We strive to foster mutually beneficial relationships with our clients. We stay in touch year round, updating,collaborating and assisting you in implementing new legislation,rules and standards that affect your organization.We are also available as a sounding board and assist with technical questions. Maintaining an Impeccable Reputation We have never been involved in any litigation, proceeding or received any disciplinary action. Additionally,we have never been charged with,or convicted of,a public entity crime of any sort.We are financially stable and have never been involved in any bankruptcy proceedings. Agenda Page 49 Complying With Standards Our audit will follow the Auditing Standards of the AICPA, Generally Accepted Government Auditing Standards,issued by the Comptroller General of the United States,and the Rules of the Auditor General of the State of Florida, and any other applicable federal, state and local regulations. We will deliver our reports in accordance with your requirements. This proposal is a firm and irrevocable offer for 90 days.We certify this proposal is made without previous understanding,agreement or connection either with any previous firms or corporations offering a proposal for the same items.We also certify our proposal is in all respects fair,without outside control, collusion, fraud, or otherwise illegal action,and was prepared in good faith. Only the person(s),company or parties interested in the project as principals are named in the proposal.Grau has no existing or potential conflicts, and anticipates no conflicts during the engagement.Our Federal I.D.number is 20-2067322. We would be happy to answer any questions or to provide any additional information.We are genuinely excited about the prospect of serving you and establishing a long-term relationship.Please do not hesitate to call or email either of our Partners,Antonio J.Grau,CPA(tgrau@graucpa.com) or Racquel McIntosh,CPA (rmcintosh@graucpa.com) at 561.994.9299. We thank you for considering our firm's qualifications and experience. Very truly yours, Grau&Associates Antonio J.Grau 2 Agenda Page 50 Firm Qualifications iirGrau & Associates CERTIFIED PUBLIC ACCOUNTANTS 3 Agenda Page 51 Grau's Focus and Experience Our Team 410 4110 _♦ 20C)5 9/13 111111 GIP 611 EmpCPASsare Year founded 2 11 2 Partners Professional Administrative Staff Professionals Services Provided 29 7 Community Development Districts Served .FP\ / , k Properly registered --)r and ,� `~ Accounting Attetion licensed professional j , corporation by the state of FLORIDA Arbitrage Management Services Consulting We are proud Members of the American Institute of Certified Public Accountants & the Florida Institute of Certified Public 9 Accountants le Professional Goy Groups 0.46 External quality review program:consistently receives a pass Internal: ongoing AICPA I FICPA I GFOA I FASD I FGFOA See next page for monitoring to maintain report and certificate quality \ �/ 4 Agenda Page 52 ti* A AICPA Peer ew Program rICPA Peer Review Program AICPA Peer Review Program Administered in Florida Administered in Flonda by The Florida Institute of CPAs by the Florida Institute of CPAs February 20, 2020 Antonio Grau Grau & Associates 951 Yamato Rd Ste 280 Boca Raton, FL 33431-1809 Dear Antonio Grau: It is my pleasure to notify you that on February 20, 2020, the Florida Peer Review Committee accepted the report on the most recent System Review of your firm.The due date for your next review is December 31, 2022. This is the date by which all review documents should be completed and submitted to the administering entity. As you know, the report had a peer review rating of pass. The Committee asked me to convey its congratulations to the firm. Thank you for your cooperation. Sincerely, Pee4 Rouiw et►ow:tu Peer Review Team FICPA Peer Review Committee paul a©7ficpa.org 800-342-3197 ext. 251 Florida Institute of CPAs cc: Daniel Hevia, Racquel McIntosh Firm Number: 900004390114 Review Number 571202 3800 Esplanade Way,Suite 210 Tallahassee FL 32311,800 342 3197_m Flonda{850 224 2727 Fax'850 222.8100 i whim'fa-:pa org Grau&Associates 5 Agenda Page 53 Firm & Staff Experience Grau & Associates CERTIFIED PUBLIC ACCOUNTANTS 6 Agenda Page 54 GRAU AND ASSOCIATES COMMUNITY Profile Briefs: DEVELOPMENT DISTRICT EXPERIENCE Antonio J GRAU, CPA BY MANAGEMENT COMPANY (Partner) Years Performing Audits:30+ CPE(last 2 years): Government PFM Accounting,Auditing: 12 24 hours;Accounting, Auditing and Other: GMS 58 hours 78 Professional Memberships:AICPA, FICPA, FGFOA, GFOA Racquel McIntosh, CPA (Partner) RIZZETTA MERITUS Years Performing SDS6 a7 23 Audits: 14+ CPE(last 2 years): Government Accounting,Auditing: 38 hours;Accounting, Auditing and Other: 56 hours Professional Memberships:AICPA, FICPA, FGFOA, FASD "Here at Grau &Associates,staying up to date with the current technological landscape is one of our top priorities.Not only does it provide a more positive experience for our clients,but it also allows us to perform a more effective and efficient audit. With the every changing technology available and utilized by our clients, we are constantly innovating our audit process." - Tony Grau "Quality audits and exceptional client service are at the heart of every decision we make.Our clients trust us to deliver a quality audit,adhering to high standards and assisting them with improvements for their organization." -Racquel McIntosh l Grau&Associates 7 Agenda Page 55 YOUR ENGAGEMENT TEAM Grau's client-specific engagement team is meticulously organized in order to meet the unique needs of each client. Constant communication within our solution team allows for continuity of staff and audit team. Grau contracts with an An advisory consultant will outside group of IT be available as a sounding management consultants to board to advise in those assist with matters areas where problems are including,but not limited to; encountered. network and database security,internet security and vulnerability testing. Your '6 Successful 1 Audit ea Is Audit Staff The assigned personnel will The Engagement Partner will work closely with the partner participate extensively during and the District to ensure that the various stages of the the financial statements and all engagement and has direct other reports are prepared in responsibility for engagement accordance with professional policy,direction,supervision, standards and firm policy. quality control,security, Responsibilities will include confidentiality of information planning the audit; of the engagement and communicating with the client communication with client and the partners the progress personnel.The engagement of the audit;and partner will also be involved determining that financial directing the development of statements and all reports the overall audit approach issued by the firm are accurate, and plan;performing an complete and are prepared in overriding review of work accordance with professional papers and ascertain client standards and firm policy. satisfaction.6_„/ Grau&Associates 8 ,'F Antonio `Tony ` J. Gran CPA v , genda age 56 . Partner Contact: tgrau@graucpa.com I (561) 939-6672 `'a_ _ Experience ~ '" ' �`""!t / I i ; I or ' , For over 30 years,Tony has been providing audit, accounting and consulting services to the firm's governmental,non-profit, . employee benefit,overhead and arbitrage clients.He provides j ; 1 tq •• guidance to clients regarding complex accounting issues, I' 0 1 7 internal controls and operations. - ' , " 4,...400 " As a member of the Government Finance Officers Association r. Special Review Committee, Tony participated in the review tl "'!"*, process for awarding the GFOA Certificate of Achievement in , IV 1 Financial Reporting.Tony was also the review team leader for �{ the Quality Review of the Office of Management Audits of t °` ' >'� School Board of Miami-Dade County.Tony received the AICPA '#tr '. advanced level certificate for governmental single audits. I, Education University of South Florida (1983) Bachelor of Arts Business Administration Clients Served (partial list) (>300) Various Special Districts, including: Bayside Improvement Community Development District St. Lucie West Services District Dunes Community Development District Ave Maria Stewardship Community District Fishhawk Community Development District(I,II,IV) Rivers Edge II Community Development District Grand Bay at Doral Community Development District Bartram Park Community Development District Heritage Harbor North Community Development District Bay Laurel Center Community Development District Boca Raton Airport Authority Greater Naples Fire Rescue District Key Largo Wastewater Treatment District Lake Worth Drainage District South Indian River Water Control Professional Associations/Memberships American Institute of Certified Public Accountants Florida Government Finance Officers Association Florida Institute of Certified Public Accountants Government Finance Officers Association Member City of Boca Raton Financial Advisory Board Member Professional Education (over the last two years) Course Hours Government Accounting and Auditing 24 Accounting,Auditing and Other 58 Total Hours 82 (includes of 4 hours of Ethics CPE) fir. C:rau&Associates 9 Racquel C. McIntosh, CPA Agenda Page 57 Partner Contact: rmcintosh@graucpa.com I (561) 939-6669 4410111 Experience M Racquel has been providing government audit, accounting and advisory services to our clients for over 14 years. She serves as , , " ' � the firm's quality control partner; in this capacity she closely r 4 monitors engagement quality ensuring standards are followed and maintained throughout the audit. 11 _ Racquel develops in-house training seminars on current ha ,,` government auditing, accounting, and legislative topics and also * ' r .. st, - p.‘ provides seminars for various government organizations. In addition, she assists clients with implementing new accounting software,legislation,and standards. Education Florida Atlantic University(2004) Master of Accounting Florida Atlantic University(2003) Bachelor of Arts: Finance,Accounting Clients Served (partial list) (>300) Various Special Districts, including: Carlton Lakes Community Development District Westchase Community Development District Golden Lakes Community Development District Monterra Community Development District Rivercrest Community Development District Palm Coast Park Community Development District South Fork III Community Development District Long Leaf Community Development District TPOST Community Development District Watergrass Community Development District East Central Regional Wastewater Treatment Facilities Indian Trail Improvement District Pinellas Park Water Management District Ranger Drainage District South Trail Fire Protection and Rescue Service District Professional Associations/Memberships American Institute of Certified Public Accountants FICPA State&Local Government Committee Florida Institute of Certified Public Accountants FGFOA Palm Beach Chapter Professional Education (over the last two years) Course Hours Government Accounting and Auditing 38 Accounting,Auditing and Other 56 Total Hours 94 (includes of 4 hours of Ethics CPE) ei 0 Grau Associates 10 4 . , Agenda Page 58 References lirAssociates CERTIFIEDr PUBLIC ACCOUNTANTS 11 Agenda Page 59 We have included three references of government engagements that require compliance with laws and regulations, follow fund accounting, and have financing requirements, which we believe are similar to the District. Dunes Community Development District Scope of Work Financial audit Engagement Partner Antonio J. Grau Dates Annually since 1998 Client Contact Darrin Mossing, Finance Director 475 W. Town Place, Suite 114 St.Augustine, Florida 32092 904-940-5850 Two Creeks Community Development District Scope of Work Financial audit Engagement Partner Antonio J. Grau Dates Annually since 2007 Client Contact William Rizzetta, President 3434 Colwell Avenue, Suite 200 Tampa, Florida 33614 813-933-5571 journe 's End Community Development District Scope of Work Financial audit Engagement Partner Antonio J. Grau Dates Annually since 2004 Client Contact Todd Wodraska,Vice President 2501 A Burns Road Palm Beach Gardens, Florida 33410 561-630-4922 Grau lssociates 12 Agenda Page 60 Specific Audit Approach niAssociates PUBLIC ACCOUNTANTS 13 Agenda Page 61 AUDIT APPROACH Grau's Understanding of Work Product/Scope of Services: We recognize the District is an important entity and we are confident our firm is eminently qualified to meet the challenges of this engagement and deliver quality audit services. You would be a valued client of our firm and we pledge to commit all firm resources to provide the level and quality of services(as described below) which not only meet the requirements set forth in the RFP but will exceed those expectations.Grau&Associates fully understands the scope of professional services and work products requested. Our audit will follow the Auditing Standards of the AICPA, Generally Accepted Government Auditing Standards,issued by the Comptroller General of the United States,and the Rules of the Auditor General of the State of Florida and any other applicable Federal,State of Local regulations.We will deliver our reports in accordance with your requirements. Proposed segmentation of the engagement Our approach to the audit engagement is a risk-based approach which integrates the best of traditional auditing techniques and a total systems concept to enable the team to conduct a more efficient and effective audit.The audit will be conducted in three phases,which are as follows: PHASE I: PHASE II: PHASE III: Preliminary Execution of the Completion and Cep' Planning Audit Plan Delivery Phase I - Preliminary Planning; A thorough understanding of your organization, service objectives and operating environment is essential for the development of an audit plan and for an efficient, cost-effective audit. During this phase, we will meet with appropriate personnel to obtain and document our understanding of your operations and service objectives and, at the same time, give you the opportunity to express your expectations with respect to the services that we will provide. Our work effort will be coordinated so that there will be minimal disruption to your staff. During this phase we will perform the following activities: » Review the regulatory, statutory and compliance requirements.This will include a review of applicable federal and state statutes, resolutions, bond documents, contracts, and other agreements; » Read minutes of meetings; » Review major sources of information such as budgets, organization charts, procedures, manuals,financial systems,and management information systems; » Obtain an understanding of fraud detection and prevention systems; » Obtain and document an understanding of internal control, including knowledge about the design of relevant policies, procedures, and records, and whether they have been placed in operation; » Assess risk and determine what controls we are to rely upon and what tests we are going to perform and perform test of controls; » Develop audit programs to incorporate the consideration of financial statement assertions, specific audit objectives,and appropriate audit procedures to achieve the specified objectives; » Discuss and resolve any accounting, auditing and reporting matters which have been identified. 0% ( rau&Assoc iates 14 Agenda Page 62 Phase II - Execution of Audit Plan The audit team will complete a major portion of transaction testing and audit requirements during this phase. The procedures performed during this period will enable us to identify any matter that may impact the completion of our work or require the attention of management. Tasks to be performed in Phase II include,but are not limited to the following: » Apply analytical procedures to further assist in the determination of the nature, timing, and extent of auditing procedures used to obtain evidential matter for specific account balances or classes of transactions; » Perform tests of account balances and transactions through sampling,vouching,confirmation and other analytical procedures;and » Perform tests of compliance. Phase III - Completion and Delivery In this phase of the audit, we will complete the tasks related to year-end balances and financial reporting.All reports will be reviewed with management before issuance, and the partners will be available to meet and discuss our report and address any questions.Tasks to be performed in Phase III include,but are not limited to the following: » Perform final analytical procedures; » Review information and make inquiries for subsequent events;and » Meeting with Management to discuss preparation of draft financial statements and any potential findings or recommendations. You should expect more from your accounting firm than a signature in your annual financial report. Our concept of truly responsive professional service emphasizes taking an active interest in the issues of concern to our clients and serving as an effective resource in dealing with those issues.In following this approach,we not only audit financial information with hindsight but also consider the foresight you apply in managing operations. Application of this approach in developing our management letter is particularly important given the increasing financial pressures and public scrutiny facing today's public officials. We will prepare the management letter at the completion of our final procedures. In preparing this management letter,we will initially review any draft comments or recommendations with management.In addition,we will take necessary steps to ensure that matters are communicated to those charged with governance. In addition to communicating any recommendations,we will also communicate the following,if any: » Significant audit adjustments; » Significant deficiencies or material weaknesses; » Disagreements with management;and » Difficulties encountered in performing the audit. 6 Grau&Associates 15 Agenda Page 63 Our findings will contain a statement of condition describing the situation and the area that needs strengthening, what should be corrected and why. Our suggestions will withstand the basic tests of corrective action: Is the recommendation cost effective? Is the recommendation the simplest to effectuate in order to correct a problem? Is the recommendation at the heart of the problem and not just correcting a symptomatic matter? Is the corrective action taking into account why the deficiency occurred? To assure full agreement with facts and circumstances, we will fully discuss each item with Management prior to the final exit conference.This policy means there will be no "surprises" in the management letter and fosters a professional,cooperative atmosphere. Communications We emphasize a continuous,year-round dialogue between the District and our management team.We regularly communicate through personal telephone calls and electronic mail throughout the audit and on a regular basis. Our clients have the ability to transmit information to us on our secure client portal with the ability to assign different staff with separate log on and viewing capability. This further facilitates efficiency as all assigned users receive electronic mail notification as soon as new information has been posted into the portal. Grau&Associates Agenda Page 64 Cost of Services Grau & Associates CERTIFIED PUBLIC ACCOUNTANTS 17 Agenda Page 65 Our proposed all-inclusive fees for the financial audit for the fiscal years ended September 30, 2020-2022 are as follows: Year Ended September 30, Fee 2020 $2,900 2021 $3,000 2022 $3,100 TOTAL (2020-2022) $9,000 The above fees are based on the assumption that the District maintains its current level of operations.Should conditions change or Bonds are issued the fees would be adjusted accordingly upon approval from all parties concerned. Grau&Associates 1'1R11,. 18 Agenda Page 66 Supplemental Information raj Grau & Associates CERTIFIt t) PUBLIC ACCOUNTANTS 19 Agenda Page 67 PARTIAL LIST OF CLIENTS SPECIAL DISTRICTS y Q Q V W y c u. Boca Raton Airport Authority ✓ ✓ ✓ 9/30 Captain's Key Dependent District ✓ ✓ 9/30 Central Broward Water Control District ✓ ✓ 9/30 Collier Mosquito Control District ✓ ✓ 9/30 Coquina Water Control District ✓ ✓ 9/30 East Central Regional Wastewater Treatment Facility ✓ ✓ 9/30 Florida Green Finance Authority ✓ 9/30 Greater Boca Raton Beach and Park District ✓ ✓ 9/30 Greater Naples Fire Control and Rescue District ✓ ✓ V 9/30 Green Corridor P.A.C.E. District ✓ ✓ 9/30 Hobe-St. Lucie Conservancy District ✓ V 9/30 Indian River Mosquito Control District ✓ 9/30 Indian Trail Improvement District ✓ ✓ 9/30 Key Largo Waste Water Treatment District ✓ ✓ ✓ ✓ 9/30 Lake Padgett Estates Independent District ✓ ✓ 9/30 Lake Worth Drainage District ✓ ✓ 9/30 Loxahatchee Groves Water Control District ✓ 9/30 Old Plantation Control District ✓ ✓ 9/30 Pal Mar Water Control District ✓ V 9/30 Pinellas Park Water Management District ✓ ✓ 9/30 Pine Tree Water Control District(Broward) ✓ ✓ 9/30 Pinetree Water Control District(Wellington) ✓ 9/30 Ranger Drainage District ✓ ✓ ✓ 9/30 Renaissance Improvement District ✓ ✓ 9/30 San Carlos Park Fire Protection and Rescue Service District ✓ ✓ 9/30 Sanibel Fire and Rescue District ✓ ✓ 9/30 South Central Regional Wastewater Treatment and Disposal Board ✓ V 9/30 South-Dade Venture Development District ✓ ✓ 9/30 South Indian River Water Control District ✓ ✓ ✓ 9/30 South Trail Fire Protection& Rescue District ✓ ✓ 9/30 Spring Lake Improvement District ✓ ✓ 9/30 St. Lucie West Services District ✓ ✓ ✓ 9/30 Sunshine Water Control District ✓ ✓ 9/30 West Villages Improvement District ✓ ✓ 9/30 Various Community Development Districts(297) ✓ ✓ 9/30 TOTAL 332 5 3 327 )C rau&Associates 20 Agenda Page 68 ADDITIONAL SERVICES CONSULTING /MANAGEMENT ADVISORY SERVICES Grau & Associates also provide a broad range of other management consulting services. Our expertise has been consistently utilized by Governmental and Non-Profit entities throughout Florida. Examples of engagements performed are as follows: • Accounting systems • Fixed asset records • Development of budgets • Cost reimbursement • Organizational structures • Indirect cost allocation • Financing alternatives • Grant administration and compliance • IT Auditing ARBITRAGE The federal government has imposed complex rules to restrict the use Current of tax-exempt financing. Their principal purpose is to eliminate any ;e) Arbitrage significant arbitrage incentives in a tax-exempt issue. We have Calculations determined the applicability of these requirements and performed the rebate calculations for more than 150 bond issues, including both fixed and variable rate bonds. We look forward to providing Naples Heritage Community Development District with our resources and experience to accomplish not only those minimum requirements set forth in your Request for Proposal, but to exceed those expectations! For even more information on Grau &Associates please visit us on www.graucpa.com. ri (dal`i 21 Ill N 0666 0 C O O - O © d M M M O) N M M O) r lL 0. 101 II N II 101 II N 11 O 0 R m N 0000 O O O O co N N N F N N N F a co C N m y Q >,C y> 0 yNC OhvU U RV R >. c 0R a) U a) C -0 a C . N'(0 N .Q1 Ovm CO VyCm E )) N 0 coC a N ...gals 0' X 0 0 0 0 3 a R N a O C m t o H N E U N N O N O_ WO O C N N 13 2 E a C C r C0 4 .(y R N d C 41 00 T J >.2 N a O N R 30 0 rn € >M R L O N E. YO N C Y E m lL a E a! N O € O a) R Q LL O N L O a) C M C c coC O Y O a -2 J 20 6 U a) o C U E ° W N E d E 0. > O° c R ( 3 ER m c m N yCaovi m _ .E ❑ p ` Eac ovav N N O)7aCO(1 C VEa N O0CC0 d N Oa° RO0a NU.CNO N O am > y RE O.N a > O ma- Ea C co 0a.E Nca• Oo UCc OO� o CydUV « VO • MI LL C NO. 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N 0 O_O)O j R Q 01, x2020 C a R 0 'O 0 m-0 C O)- O_ 0 R N a Q C 2 > O C R C C R C 7 O V) ' of U N N N N m - O W .d. a) C O RwE .NE - oa u -. av � >. E a E rn R 2 o a y cOi a> > c N % ° a o w o aai u 0 o R m � O a o)a °o)E(n a, O m m € o E C a O ?: �iiaEc r a m w xf a) a N EO y U N E C Y O _ R °'a C N N E a 0 T. rn E W € LL m W R O it U z cn a) Y d C CO(13 a W C a) m Q N C O O a) O LL O. Ol O N L N U) V E E 0 IL O CO C O 0 -0 a T c. O 5 N 'n a� a °' N N w O 0 Y N � C O N w :l _ N 2 0 C1 O y a) N a C1 O } a) 0 N LL C 0 a) a3 C, cn 0 Y 0_L O CD CL N U N In0) y a) - 6) D aa) O. Q 00 %a, Z Q a uJ N O a) a) 'GIL C co C ' 0 N 03 y C E a c E w a n 00 (J) T N El a C C w 06 ui _ a) C T a) .- E CD [6 as U E N a) it w to n a) a vi @ a E 0 a) 0 N I-0 N a' Q a) N °ts u) ET) z E a) @ m 0 Z Berger, Toombs, Gaines,& Grau& Naples Heritage CDD Frank Associates Audit RFP Point Totals Supervisor Gaynor Ability of Proposer's Understandi Ability to Furnish the Totals Audit Firm Personnel Experience ng Scope of Required Services Price(20 Points) (100 Points) (20 Points) (20 Points) RFP (20 Points) (20 Points) Berger,Toombs,Gaines,& 20 20 20 20 10 90 90 Frank Grau&Associates 20 20 20 20 20 100 100 Supervisor James Ability of Proposer's Understandi Ability to Furnish the Totals Audit Firm Personnel Experience ng Scope of Required Services Price(20 Points) (20 Points) (20 Points) RFP (20 Points) (100 Points) (20 Points) Berger,Toombs,Gaines,& 20 20 20 20 10 90 90 Frank Grau&Associates 20 20 20 20 20 100 100 Supervisor Leonhard Ability of Proposer's Understandi Ability to Furnish the Totals Audit Firm Personnel Experience ng Scope of Required Services Price(20 Points) (300 Points) (20 Points) (20 Points) RFP (20 Points) (20 Points) Berger,Toombs,Gaines,& 0 0 Frank Grau&Associates 0 0 Supervisor Ramundo Ability of Proposer's Understandi Ability to Furnish the Totals Audit Firm Personnel Experience ng Scope of Required Services Price(20 Points) (20 Points) (20 Points) RFP (20 Points) (100 Points) (20 Points) Berger,Toombs,Gaines,& 20 20 20 20 10 90 90 Frank Grau&Associates 20 20 20 20 20 100 100 Supervisor Rutkowski Ability of Proposer's Ability to Furnish the Understandi Totals Audit Firm Personnel Experience Required Services Price(20 Points) (20 Points) (20 Points) ng SRFPe of (20 Points) (100 Points) Berger,Toombs,Gaines,& 20 20 20 20 10 90 90 Frank Grau&Associates 20 20 20 20 20 100 100 Total Points 360 400 Agenda Page 72 REGULAR MEETING 951 Yamato Road•Suite 280 (�1- « Boca Raton, Florida 33431 (561)994-9299-(800)299-4728 Fax (561)994-5623 t 0 0t:l;lttltlI I) I'IlBt.It �1(;t f)tl,ti`i,1nl�, www.graucpa,cam November 11,2020 To Board of Supervisors Naples Heritage Community Development District 210 N. University Drive,Suite 702 Coral Springs,FL 33071 We are pleased to confirm our understanding of the services we are to provide Naples Heritage Community Development District, Collier County,Florida('the District")for each of the fiscal years ended September 30, 2020 with an option for two one-year renewals,We will audit the financial statements of the governmental activities and each major fund,including the related notes to the financial statements. which collectively comprise the basic financial statements of Naples Heritage Community Development District as of and for the fiscal year ended September 30,2020 with an option of two one-year renewals.In addition, we will examine the District's compliance with the requirements of Section 218.415 Florida Statutes. Accounting standards generally accepted in the United States of America provide for certain required supplementary information (RSI),such as management's discussion and analysts(MD&A), to supplement the District's basic financial statements Such information,although not a part of the basic financial statements,is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational,economic,or historical context.As part of our engagement,we will apply certain limited procedures to the District's RSI In accordance with auditing standards generally accepted in the United States of America, These limited procedures will consist of inquiries of management regarding the methods of preparing the information and comparing the information for consistency with managements responses to our inquiries, the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements.We will not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. The following RSI is required by generally accepted accounting principles and will be subjected to certain limited procedures, but will not be audited: 1) Managements Discussion and Analysis 2) Budgetary comparison schedule Audit Objectives The objective of our audit is the expression of opinions as to whether your financial statements are fairly presented,In all material respects,in conformity with U.S. generally accepted accounting principles and to report on the fairness of the supplementary information referred to in the second paragraph when considered in relation to the financial statements as a whole. Our audit will be conducted in accordance with auditing standards generally accepted in the United States of America and the standards for financial audits contained in Government Auditing Standards, Issued by the Comptroller General of the United States,and will include tests of the accounting records of the District and other procedures we consider necessary to enable us to express such opinions.We will issue a written report upon completion of our audit of the Districts financial statements.We cannot provide assurance that an unmodified opinion will be expressed.Circumstances may arise in which it is necessary for us to modify our opinion or add emphasis-of-matter or other-matter paragraphs.If our opinion on the financial statements is other than unmodified, we will discuss the reasons with you in advance if,for any reason,we are unable to complete the audit or are unable to form or have not formed an opinion,we may decline to express an opinion or issue a report,or may withdraw from this engagement, We will also provide a report (that does not include an opinion)on internal control related to the financial statements and compliance with the provisions of laws,regulations,contracts,and grant agreements,noncompliance with which could have a material effect on the financial statements as required by Government Auditing Standards.The report on internal control and on compliance and other matters will include a paragraph that states(1)that the purpose of the report Is solely to describe the scope of testing of internal control and compliance, and the results of that testing, and not to provide an opinion on the effectiveness of the District's Internal control on compliance,and(2)that the report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the District's internal control and compliance. The paragraph will also state that the report is not suitable for any other purpose.If during our audit we become aware that the District Is subject to an audit requirement that is not encompassed in the terms of this engagement.we will communicate to management and those charged with governance that an audit in accordance with U.S.generally accepted auditing standards and the standards for financial audits contained in Government Auditing Standards may not satisfy the relevant legal,regulatory,or contractual requirements, Naples Heritage Community Development District 2 Examination Objective The objective of our examination is the expression of an opinion as to whether the District is in compliance with Florida Statute 218.415 in accordance with Rule 10.556(10)of the Auditor General of the State of Florida. Our examination will be conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and will include tests of your records and other procedures we consider necessary to enable us to express such an opinion,We will issue a written report upon completion of our examination of the District's compliance.The report will include a statement that the report is intended solely for the information and use of management,those charged with governance,and the Florida Auditor General, and is not Intended to be and should not be used by anyone other than these specified parties.We cannot provide assurance that an unmodified Opinion will be expressed, Circumstances may arise in which it is necessary(or us to modify our opinion or add emphasis-of-matter or other-matter paragraphs, if our opinion on the Districts compliance is other than unmodified,we will discuss the reasons with you In advance.If,for any reason,we are unable to complete the examination or are unable to form or have not formed an opinion,we may decline to express an opinion or issue a report,or may withdraw from this engagement, Other Services We will assist in preparing the financial statements and related notes of the District in conformity with U.S_generally accepted accounting principles based on information provided by you. These nonaudit services do not constitute an audit under Government Auditing Standards and such services will not be conducted in accordance with Government Auditing Standards. The other services are limited to the financial statement services previously defined.We, in our sole professional judgment, reserve the right to refuse to perform any procedure or take any action that could be construed as assuming management responsibilities. Management Responsibilities Management is responsible for compliance with Florida Statute 218.415 and will provide us with the information required for the examination.The accuracy and completeness of such information is also management's responsibility.You agree to assume ail management responsibilities relating to the financial statements and related notes and any other nonaudit services we provide. You will be required 10 acknowledge in the management representation letter our assistance with preparation of the financial statements and related notes and that you have reviewed and approved the financial statements and related notes prior to their issuance and have accepted responsibility for them.In addition,you will be required to make certain representations regarding compliance with Florida Statute 218.415 In the management representation letter. Further,you agree to oversee the nonaudit services by designating an individual, preferably from senior management, who possesses suitable skill, knowledge, or experience;evaluate the adequacy and results of those services;and accept responsibility for them Management is responsible for designing, implementing and maintaining effective internal controls, Including evaluating and monitoring ongoing activities.to help ensure that appropriate goals and objectives are met;following laws and regulations;and ensuring that management and financial information is reliable and property reported. Management is also responsible for implementing systems designed to achieve compliance with applicable laws,regulations,contracts,and grant agreements.You are also responsible for the selection and application of accounting principles, for the preparation and fair presentation of the financial statements and all accompanying information in conformity with U.S.generally accepted accounting principles,and for compliance with applicable laws and regulations and the provisions of contracts and grant agreements, Management is also responsible for making all financial records and related information available to us and for the accuracy and completeness of that Information. You are also responsible for providing us with(1)access to all information of which you are aware that is relevant to the preparation and fair presentation of the financial statements,(2)additional information that we may request for the purpose of the audit,and(3)unrestricted access to persons within the government from whom we determine it necessary to obtain audit evidence. Your responsibilities include adjusting the financial statements to correct material misstatements and for confirming to us in the written representation letter that the effects of any uncorrected misstatements aggregated by us during the current engagement and pertaining to the latest period presented are immaterial, both individually and in the aggregate,to the financial statements taken as a whole. You are responsible for the design and implementation of programs and controls to prevent and detect fraud,and for informing us about all known or suspected fraud affecting the government involving(1)management,(2)employees who have significant roles in internal control, and (3) others where the fraud could have a material effect on the financial statements. Your responsibilities include informing us of your knowledge of any allegations of fraud or suspected fraud affecting the government received in communications from employees,former employees,grantors,regulators,or others In addition,you are responsible for identifying and ensuring that the government complies with applicable laws,regulations,contracts,agreements,and grants and for taking timely and appropriate steps to remedy fraud and noncompliance with provisions of laws,regulations,contracts or grant agreements,or abuse that we report. Management is responsible for establishing and maintaining a process for tracking the status of audit findings and recommendations_ Management is also responsible for identifying and providing report copies of previous financial audits, attestation engagements,performance audits or other studies related to the objectives discussed in the Audit Objectives section of this letter, This responsibility includes relaying to us corrective actions taken to address significant findings and recommendations resulting from those audits, attestation engagements, performance audits, or other studies. You are also responsible for providing management's views on our current findings, conclusions, and recommendations, as well as your planned corrective actions,for the report,and for the timing and format for providing that Information, Naples Heritage Community Development District 3 With regard to the electronic dissemination of audited financial statements,including financial statements published electronically on your website,you understand that electronic sites are a means to distribute information and,therefore,we are not required to read the information contained in these sites or to consider the consistency of other information in the electronic site with the original document. Audit Procedures--General An audit Includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial Statements; therefore,our audit will involve judgment about the number of transactions to be examined and the areas to be tested.An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.We will plan and perform the audit to obtain reasonable rather than absolute assurance about whether the financial statements are free of material misstatement,whether from(1)errors, (2)fraudulent financial reporting,(3)misappropriation of assets,or(4)violations of laws or governmental regulations that are attributable to the government or to acts by management or employees acting on behalf of the government.Because the determination of abuse is subjective.Government Auditing Standards do not expect auditors to provide reasonable assurance of detecting abuse. Because of the inherent limitations of an audit.combined with the inherent limitations of internal control,and because we will not perform a detailed examination of ail transactions,there is a risk that material misstatements may exist and not be detected by us,even though the audit is properly planned and performed in accordance with U.S.generally accepted auditing standards and Government Auditing Standards. In addition,an audit is not designed to detect immaterial misstatements or violations of laws or governmental regulations that do not have a direct and material effect on the financial statements.Our responsibility as auditors is limited to the period covered by our audit and does not extend to later periods for which we are not engaged as auditors. Our procedures will include tests of documentary evidence supporting the transactions recorded in the accounts, and may include tests of the physical existence of inventories,and direct confirmation of receivables and certain other assets and liabilities by correspondence with selected individuals, funding sources, creditors, and financial institutions, We will request written representations from your attorneys as part of the engagement, and they may bill you for responding to this inquiry. At the conclusion of our audit, we will require certain written representations from you about your responsibilities for the financial statements;compliance with laws,regulations,contracts,end grant agreements;end other responsibilities required by generally accepted auditing standards Audit Procedures—Internal Control Our audit will include obtaining an understanding of the government and its environment,including internal control,sufficient to assess the risks of material misstatement of the financial statements and to design the nature,timing,and extent of further audit procedures. Tests of controls may be performed to test the effectiveness of certain controls that we consider relevant to preventing and detecting errors and fraud that are material to the financial statements and to preventing and detecting misstatements resulting from illegal acts and other noncompliance matters that have a direct and material effect on the financial statements.Our tests,if performed,will be less in scope than would be necessary to render an opinion on internal control and, accordingly,no opinion will be expressed in our report on internal control issued pursuant to Government Auditing Standards. An audit is not designed to provide assurance on internal control or to identify significant deficiencies or material weaknesses, However,during the audit,we will communicate to management and those charged with governance internal control related matters that are required to be communicated under AICPA professional standards and Government Auditing Standards Audit Procedures--Compliance As part of obtaining reasonable assurance about whether the financial statements are free of material misstatement,we will perform tests of the District's compliance with the provisions of applicable laws,regulations,contracts,agreements,and grants. However, the objective of our audit will not be to provide an opinion on overall compliance and we will not express such an opinion in our report on compliance issued pursuant to Government Auditing Standards. Engagement Administration,Fees,and Other We understand that your employees will prepare all confirmations we request and will locate any documents selected by us for testing. The audit documentation for this engagement is the property of Grau 8 Associates and constitutes confidential information. However, subject to applicable laws and regulations, audit documentation and appropriate individuals will be made available upon request and in a timely manner to a cognizant or oversight agency or its designee,a federal agency providing direct or indirect funding, or the U.S. Government Accountability Office for purposes of a quality review of the audit, to resolve audit findings,or to carry out oversight responsibilities. We will notify you of any such request. If requested, access to such audit documentation will be provided under the supervision of Grau &Associates personnel. Furthermore,upon request, we may provide copies of selected audit documentation to the aforementioned parties.These parties may intend,or decide,to distribute the copies or information contained therein to others,including other governmental agencies,Notwithstanding the foregoing,the parties acknowledge that various documents reviewed or produced during the conduct of the audit may be public records under Florida law. The District agrees to notify Grau & Associates of any public record request it receives that involves audit documentation. Naples Heritage Community Development District 4 Our fee for these services$2,900 for the September 30,2020 audit. The fees for the two additional annual renewals for the fiscal years 2021 and 2022 will be$3,000 and$3,100, respectively, unless there is a change in activity by the District which results in additional audit work or if debt is issued, We will complete the audit within prescribed statutory deadlines, with the understanding that your employees will provide Information needed to perform the audit on a timely basis, The audit documentation for this engagement will be retained for a minimum of five years after the report release date, If we are aware that a federal awarding agency or auditee is contesting an audit finding,we will contact the party(ies)contesting the audit finding for guidance prior to destroying the audit documentation. Our invoices for these fees will be rendered each month as work progresses and are payable on presentation.invoices will be submitted in sufficient detail to demonstrate compliance with the terms of this agreement.In accordance with our firm policies, work may be suspended if your account becomes 60 days or more overdue and may not be resumed until your account is paid in full. If we elect to terminate our services for nonpayment,our engagement will be deemed to have been completed upon written notification of termination,even tf we have not completed our report.You will be obligated to compensate us for all time expended and to reimburse us for all out-of-pocket costs through the date of termination_The above fee is based on anticipated cooperation from your personnel and the assumption that unexpected circumstances will riot be encountered during the audit, if significant additional time is necessary,we will discuss it with you and arrive at a new fee estimate, This agreement may be renewed each year thereafter subject to the mutual agreement by both parties to all terms and fees. The fee For each annual renewal will be agreed upon separately, The District has the option to terminate this agreement with or without cause by providing thirty (30)days written notice of termination to Grau&Associates. Upon any termination of this agreement,Grau&Associates shall be entitled to payment of all work and/or services rendered up until the effective termination of this agreement,subject to whatever claims or off-sets the District may have against Grau&Associates. We will provide you with a copy of our most recent external peer review report and any letter of comment,end any subsequent peer review reports and letters of comment received during the period of the contract,Our 2019 peer review report accompanies this letter. We appreciate the opportunity to be of service to Naples Heritage Community Development District and believe this letter accurately summarizes the significant terms of our engagement.If you have any questions,please let us know.If you agree with the terms of our engagement as described in this letter,please sign the enclosed copy and return it to us, Very truly yours, Grau&Associates Racquel McIntosh RESPONSE of &Associates must comply with Senate Sill 664 regarding the use ryf E verify beginning i/1/21. This letter correctly sets forth the understanding of Naples Heritage Community Development District. By. Justin Faircioth Tile District Manager f Secretary Date: 11/13/20 Naples Heritage Community Development District 5 F CPA ,.. AICPA Prtgro,n FKPA Paw Roma*,Program MOM Pwr ReNaw Program Ac1irm,slarrx.{in fiyda tnr.Fiorda tr to o1 CPAs hdrnrAtergd in Fla by lba Fiolala tbstivto tat CPAs February 20,2020 Antonio Grau Graff&Associates 951 Yamada Rd Ste 280 Boca Raton,FL 33431-1809 Dear Antonio Grau it is my pIure to notify you that on February 20, 2020,the Florida Peer Review Committee accepted the report on the most recent *stem Review of your lien The due date for your next review is December 31, 2022 This is the date try which all review documents should be completed and submitted to the administering entity As you know, the report had a peer review rating of pass The Committee asked me to convey its congratulations to the firm. Thank you for your cooperation Sincerely, F CVA POI R144iw Con,.i.:atu Peer Review Team FICPA Peer Review Committee daucc epe,org 800-342.3197 ext 251 Flonda Institute of CPAs cc Daniel Hevia.Racquet McIntosh Firm Number 900004390114 Review Number 571202 I 1 V VO1genE Payt 81 Public Risk Insurance Advisors P. O. Box 2416 Customer Naples Heritage CDD Daytona Beach, FL 32115 Acct# 1789 Date 09/21/2020 Customer Robin Russell Service Karen Bryan Page 1 of 1 Payment Information Invoice Summary $ 7,747.00 Naples Heritage CDD Payment Amount Payment for: Invoice#69698 Naples Heritage Community Development District PK2FL1 0114007 19-13 Inframark Infrastructure Management Services 210 N. University Drive,#702 Thank You Coral Springs, FL 33071 Customer: Naples Heritage CDD Invoice Effective Transaction Description it Amount Policy#PK2FL1 0114007 19-13 10/01/2019-10/01/2021 Preferred Governmental Insurance Trust(PGIT) 69698 10/01/2020 Policy change Business Auto-PKG Anniv Endt 1 500.00 General Liability-PKG Anniv Endt 1 4,500.00 Public Officials&Employment Practices Liability-PKG Anniv 2,747.00 Endt 1 Total $ 7,747.00 Thank You Public Risk Insurance Advisors (386)252-6176 P. O. Box 2416 09/21/2020 Daytona Beach, FL 32115 Preferred Governmental Insurance Trust Agenda Page 82 Coverage Agreement Endorsement Endorsement No.: 001 Effective Date: See Below Member: Naples Heritage Community Development District Agreement No.: PK2FL1 0114007 19-13 Coverage Period: 10/01/2019 to 10/01/2021 Premium for Second Annual Installment: $7,747 Auto(Symbols 8,9) Coverage is confirmed as being per the attached updated Automobile Schedule. Liability Rating Basis Payroll is amended to$0 #of Employees is amended to 0 Effective 10/01/2020: Per COMMON AGREEMENT CONDITIONS, PGIT MN-090(10 19)paragraph G, LIBERALIZATION, agreement and terms are amended as follows: General Liability PGIT MN 203 part K is amended as follows: 1.arising out of or caused by or contributed to by any actual or alleged deterioration, bursting, inadequacy, design of, control of, maintenance of, or any other alleged responsibility for any structure device, or water course, natural or man-made, including but not limited to: dams, reservoirs, levees, banks, embankments, gates, canals, ditches, gutters, sewers, aqueducts, channels, culverts, retaining walls,drains, tanks, watersheds, or drains, a purpose of which is the containing, carrying, impeding, channeling, diverting, or draining of water or other liquid. However, if coverage is provided in Section I.E.I. of the General Liability Coverage Form, PGIT MN-200 by virtue of limits being shown on the Declarations Page, then this Section K shall not apply to property damage coverage provided in Section I.E of the General Liability Coverage Form, PGIT MN-200, but only as to the bursting or failure of man-made sewer, storm water, grey water, or potable water supply pipes owned and maintained by you. Cyber Liability Endorsement PGIT MN-700(10 20)Media Content Services,Network Security,and Privacy Liability Endorsement replaces and supercedes form PGIT MN-700(10 18) Changes in terms and conditions include but are not limited to: Cyber Crime$250,000 Agg Includes the following sublimits: Social Engineering Sublimit$250,000(this hasn't changed) 'Funds Transfer Fraud$100,000 'Invoice Manipulation$100,00 Utility Fraud $100,000 Aggregate Includes the following sublimits: Subject otherwise to the terms,conditions,and exclusions of the coverage agreement. Issued: 09/21/2020 Authorized By: 2 Year WC Endorsement.rpt Preferred Governmental Insurance Trust Agenda Page 83 Coverage Agreement Endorsement Endorsement No.: 001 Effective Date: See Below Member: Naples Heritage Community Development District Agreement No.: PK2FL1 0114007 19-13 Coverage Period: 10/01/2019 to 10/01/2021 •Crypto-Jacking$100,000 •Telecommunications Fraud$100,000 PCI DSS sublimit is increased from$250,000 to$1,000,000. Bricking Incident$250,000 sublimit Voluntary Shutdown$250,000 sublimit Subject otherwise to the terms,conditions,and exclusions of the coverage agreement. Issued: 09/21/2020 Authorized By: 2 Year WC Endorsernent.rpt Named Covered Party: Naples Heritage Community DevelopmeAMIRSage 84 1rI? erne Term: 10/01/2020 to 10/01/2021 GOVERNMENTAL INSURANCE TRUST Coverage Provided by: Preferred Governmental Insurance Trust Agreement Number: PK2FL1 0114007 19-13 WHY PREFERRED? Founded in 1999, Preferred Governmental Insurance Trust services over 400 members and fulfills what Florida needs: an insurance program exclusively customized and dedicated to the public sector. This is why we are clearly Preferred. Service provided by local retail agents, dedicated loss control safety managers, and the claims expertise provided by PGCS Claim Services combine to provide optimal Member service. Members have 24/7 access to on-line claims information. Safety training is provided live in person and on-line at no additional cost to Members. Preferred offers property appraisals to all new members upon first joining the Trust and trending of values is performed periodically after the initial appraisals. Initial appraisals are done for all property currently scheduled. Once the initial appraisal is completed, the members then have the choice to insure at appraised values with the Blanket coverage or remain at submitted values with the coverage agreement being endorsed to "stated values" with an 80% co-insurance clause. Preferred provides a full range of risk financing options that are available from first dollar to self insured excess coverage. Public Officials/Employment Practices coverage includes coverage for cyber liability, non-monetary claims including injunctive relief, EEOC, sunshine violations, petition recall, public records law, with defense costs outside of member deductible. General Liability coverage includes a sublimit for inverse condemnation. At Preferred, only workers compensation is subject to audit thus avoiding additional premium charges beyond policy expirations. Additional marketing material may be found on-line at https://pru.oms.oneshield.com. Click on Help for the following programs and benefits: • Badge Program - Cardiac Case management for all police and fire department personnel • Cyber Liability Coverage • HR Risk Management Helpline • Preferred Loss Control Services • Preferred Online Training via Target Solutions platform • Preferred Property Catastrophe Solution • Why Preferred • Preferred Financial Strength • Member Services Guide • Preferred TIPS The brief description of coverage contained in this document is being provided as an accommodation only and is not intended to cover or describe all Coverage Agreement terms.For more complete and detailed information relating to the scope and limits of coverage,please refer directly to the Coverage Agreement documents.Specimen forms are available upon request. Page 3 Print Date:9/21/2020 Agenda Page 85 Preferred; ., VERNMENTAL PUBLIC ENTITY INSURANCE THUS i COMMUNICABLE DISEASE SUBLIMIT—SPECIFIED OPERATION OR LOCATION THIS ENDORSEMENT CHANGES THE AGREEMENT. PLEASE READ IT CAREFULLY. This endorsement modifies coverage provided under the GENERAL LIABILITY COVERAGE FORM, PGIT MN-200 and the LAW ENFORCEMENT LIABILITY FORM, PGIT MN-208 SCHEDULE Specified Operation(s) or Location(s): Operation of any jail, prison, or detention facility; not including temporary holding facilities less than 24 hours and/or; Operation of any elder care, respite care, senior care, nursing care, long term care, group care, or assisted living facilities. A. The following exclusion is added to PGIT MN 200 Section I Coverages, A. Bodily Injury and Property Damage Liability, 2. Exclusions and to PGIT MN 208 Section A Coverage-Law Enforcement Liability,2. Exclusions: This coverage agreement does not apply to: V. 1. Any actual or alleged loss, liability, damage, compensation, injury, sickness, disease, death, medical payment, defense cost, cost, expense or any other amount, that, directly or indirectly and regardless of any other cause contributing concurrently or in any sequence; a. Originates from; b. Is caused by, c. Arises out of; d. Is contributed to by; e. Results from; or f. Is otherwise in connection with; A Communicable Disease or the fear or threat (whether actual or perceived) of a Communicable Disease. 2. Any cost or expense to clean-up, detoxify, remove, monitor or test for a Communicable Disease. This exclusion applies even if the claim against any Insured alleges negligence or other wrongdoing in the: PGIT MN-204(10 20) Page 1 Print Date 9/21/2020 Agenda Page 86 Supervising, hiring, employing, training or monitoring of others that may be infected with and spread a Communicable Disease; ii. Testing for a Communicable Disease; iii. Failure to prevent the spread of the Communicable Disease; or iv. Failure to report the Communicable Disease to authorities. This exclusion applies only to the Operation(s) or Location(s) shown in the Schedule above, including any operations, maintenance, ownership, supervision, management, control or locations that are necessary or incidental to the Operation(s) or Location(s) shown in the Schedule above. If a Specified Operation is designated in the Schedule above, this exclusion applies regardless of where the Specified Operation in the Schedule above is conducted, whether such Operation is conducted by you or on your behalf, or whether the Operation is conducted for yourself or for others. If a Specified Location is designated in the Schedule above, this exclusion applies to all liability and all operations only at such Location. For the purpose of this endorsement, Location means premises involving the same or connecting lots, or premises whose connection is interrupted only by a street, roadway, waterway or right-of-way of a railroad. However, up to $300,000 per occurrence and in the aggregate, inclusive of expenses and defense and after application of the General Liability Deductible/ Self-Insured Retention is provided for under PGIT MN 200 SECTION I- COVERAGES, A. BODILY INJURY AND PROPERTY DAMAGE LIABILITY claims arising out of, caused or contributed to by, resulting from, or otherwise in connection with Communicable Disease from the above Specified Operation or at the above Specified Location. B. The following definition is added PGIT MN 200 Section V - Definitions: S. Communicable Disease means any infection or contagious disease which can be transmitted by means of any substance or agent from any organism to another organism where: 1) The substance or agent includes, but is not limited to, a virus, bacterium, parasite or other organism or any variation thereof, whether deemed living or not; 2) Regardless of the method of transmission, whether direct or indirect, includes but is not limited to, airborne transmission, bodily fluid transmission, transmission from or to any surface or object, solid, liquid or gas or between humans, animals, or from any animal to any human or from any human to any animal; and 3) The disease, substance or agent can cause or threaten bodily injury, illness, emotional distress, damage to human health, human welfare or tangible or intangible property damage. All other terms and conditions remain unchanged. PGIT MN-204(10 20) Includes copyrighted material of Insurance Services Office, Inc.with its permission Page 2 Print Date 9/21/2020 Agenda Page 87 Preferred FL-4-4 (JOV`-RNVINiAt N:.RA :{`T(: PUBLIC ENTITY MEDIA CONTENT SERVICES, NETWORK SECURITY, AND PRIVACY LIABILITY ENDORSEMENT THIS IS A CLAIMS MADE AND REPORTED COVERAGE ENDORSEMENT.THIS COVERAGE APPLIES ONLY TO THOSE CLAIMS THAT ARE FIRST MADE AGAINST THE COVERED PARTY AND REPORTED IN WRITING TO THE TRUST DURING THE COVERAGE AGREEMENT PERIOD. CLAIM EXPENSES ARE WITHIN AND REDUCE THE LIMIT OF LIABILITY. PLEASE REVIEW CAREFULLY. Item 1. LIMITS OF LIABILITY (Inclusive of claim expenses and subject to sublimits per the insuring agreements): (a) $2,000,000 Each claim (b) $2,000,000 Policy Aggregate for the Agreement Period- but sublimited to: (i) $2,000,000 Aggregate for the Agreement Period, for all Privacy Notification Costs for Privacy Liability (ii) $2,000,000 Aggregate for the Agreement Period, for all regulatory fines and claim expenses for Privacy Liability Item 2. DEDUCTIBLE (Inclusive of claim expenses): (a) so Each claim (b) $0 Each claim for all Privacy Notification Costs for Privacy Liability (c) $0 Each claim for all regulatory fines and claims expenses for Privacy Liability Item 3. RETROACTIVE DATE(if applicable): 10/01/2018 Words and phrases that appear in bold print have special meanings that are defined in PGIT MN-500, PGIT MN- 510 or additional definitions exclusive to this endorsement are defined in SECTION V. DEFINITIONS of the endorsement. I. THIRD PARTY INSURING AGREEMENTS Provided always that the subject act or omission was committed on or subsequent to the retroactive date specified in Item 3. in the endorsement and that prior to the inception date of this policy no Covered Party had a basis to believe that any such act or omission, or related act or omission, might reasonably be expected to be the basis of a claim, then the Trust agrees as follows: A. Media Content Services Liability Coverage The Trust will pay on behalf of the Covered Party all sums in excess of the deductible that the Covered Party becomes legally obligated to pay as damages and claim expenses as a result of a claim first made against the Covered Party and reported in writing to the Trust during the agreement period, alleging a media wrongful act committed by the Covered Party or by someone for whom the Covered Party is legally responsible, including liability assumed under contract. PGIT MN-700(10 20) Page 1 Print Date 9/21/2020 Agenda Page 88 B. Privacy & Security Liability Coverage If, at the time of the respective act, error or omission described below,the Covered Party had in force a privacy policy pertaining to the subject matter of the corresponding subsection, then: 1. the Trust will pay on behalf of the Covered Party all sums in excess of the deductible that the Covered Party becomes legally obligated to pay as damages and claim expenses as a result of a claim first made against the Covered Party and reported in writing to the Trust during the agreement period by reason of a privacy and security wrongful act committed by the Covered Party in the Covered Party's capacity as such. 2. the Trust will pay privacy notification costs, in excess of the deductible that the Covered Party incurs with the Trust's prior written consent resulting from the Covered Party's legal obligation to comply with a data breach reporting requirement due to the Covered Party's failure to prevent unauthorized access, to the extent such unauthorized access (1) results in a data breach from a computer system, and (2) occurred and was reported in writing to the Trust during the agreement period, but only to the sublimit, if purchased, stated in Item 1.(b)(i) in the endorsement. 3. the Trust will pay on behalf of the Covered Party all sums in excess of the deductible that the Covered Party becomes legally obligated to pay as regulatory fines and claim expenses as a result of a regulatory proceeding first made against the Covered Party and reported to the Trust during the agreement period alleging a privacy and security wrongful act by the Covered Party committed in the Covered Party's capacity as such, but only to the sublimit, if any, stated in Item 1. (b)(ii) in the Declarations. C. PCI DSS Coverage 1. The Trust will pay on behalf of the Covered Party for PCI DSS fine and costs in excess of the deductible that the Covered Party is legally obligated to pay as a result of a claim first made against the Covered Party and reported to the Trust during the agreement period or extended reporting period (if applicable) alleging a PCI DSS wrongful act by the Covered Party or an outsourced provider. Provided, however, coverage under this Coverage Agreement is sublimited to an amount of$1,000,000. II. FIRST PARTY INSURING AGREEMENTS A. Cyber Extortion Threat The Trust will indemnify the Covered Party all sums incurred in excess of the deductible and with the Trust's prior written consent for cyber extortion damages as a result of an extortion threat first made against an Covered Party in its capacity as such and reported to the Trust during the agreement period by a person other than an Covered Party or any person acting or proceeding with the knowledge and consent of, at the direction or request of, or with the assistance of a Covered Party. B. Data Breach Response and Crisis Management Coverage The Trust will pay data breach response and crisis management costs incurred in excess of the deductible that the Covered Party incurs for a continuous eighteen (18) month period resulting from a data breach or cyber security breach that is first discovered by the covered party and as soon as notice of the data breach is reported to the Trust. C. Business Interruption and Extra Expense The Trust will indemnify the Covered Party all sums in excess of the deductible for: (a) Loss of business income after the waiting period; and (b) Extra expenses in excess of the applicable deductible the Covered Party sustains during the period of restoration resulting from: (1) an actual interruption of the use of the computer system of the Covered Party provided the claim results from a cyber security breach to the Covered Party's computer system; or. (2) the voluntary and intentional shutdown of the network: PGIT MN-700(10 20) Page 2 Print Date 9/21/2020 Agenda Page 89 a. ordered by an executive officer of the Covered Party who is authorized to make such an order, do the their reasonable believe that such shutdown would limit the financial impact of a cyber security breach; or b. ordered by any federal, state, local of foreign governmental entity in such entity's regulatory or official capacity, due to a cyber security breach, Where such shutdown directly causes a total or partial interruption or deterioration in the Covered Party's business operations. Provided, however the Covered Party's maximum limit of liability applicable to voluntary and intentional shutdown of the network as outlined above is sublimited to $250,000 and shall be part of, and not in addition to, the limit of liability as stated in Item 1 (a). For purposes of this coverage, loss of business income is subject to a 10-hour waiting period. D. Cyber Crime-The aggregate limit for all Cyber Crime sublimits shown below is $250,000. (a) Social Engineering Financial Fraud The Trust will indemnify the Covered Party all sums in excess of the deductible and up to a sublimit of$250,000 for social engineering financial fraud loss directly resulting from a social engineering financial fraud event. This coverage shall only apply if you verify the instruction to transfer money or securities by following a pre-arranged callback or other established procedural method to authenticate the validity or the request prior to acting upon any transfer instructions. (b) Funds Transfer Fraud The Trust will pay or reimburse the Covered Party all sums in excess of the deductible and up to a sublimit of$100,000 for funds transfer fraud loss that the Covered Party incurs directly resulting from a funds transfer fraud event, provided that such funds transfer fraud event is first discovered by the Covered Party during the coverage agreement period. (c) Invoice Manipulation The Trust will pay or reimburse the Covered Party all sums in excess of the deductible and up to a sublimit of$100,000 for invoice manipulation loss that the Covered Party incurs directly resulting from an invoice manipulation fraud event, provided that such invoice manipulation fraud event is first discovered by the Covered Party during the coverage agreement period. E. Utility Fraud- The aggregate limit for all Utility Fraud sublimits shown below is $100,000 (a) Crypto-Jacking The Trust will indemnify the Covered Party all sums in excess of the deductible and up to a sublimit of$100,000 for utility fraud loss the Covered Party incurs directly resulting from a crypto-jacking event, provided that the event is first discovered by the covered party during the coverage agreement period. (b) Telecommunications Fraud The Trust will indemnify the Covered Party all sums in excess of the deductible and up to a sublimit of$100,000 for utility fraud loss the Covered Party incurs directly resulting from a telecommunications fraud event, provided that the event is first discovered by the covered party during the coverage agreement period. F. System Failure Coverage The Trust will indemnify the Covered Party all sums incurred in excess of the deductible for: a) loss of business income after the waiting period; b) extra expense in excess of the applicable deductible, during the period of restoration that the covered party incurs resulting from a system failure directly causing a total or partial interruption or deterioration in the covered party's business operations. The declarations page is amended to include the following table: Limit Waiting Period First Party Coverage Enhancements System Failure Loss of Business Income $1,000,000 10 hours Extra Expense $1,000,000 Deductible Same as item 2a G. Dependent Business Interruption PGIT MN-700(10 20) Page 3 Print Date.9/21/2020 Agenda Page 90 The Trust will indemnify the Covered Party all sums in excess of the deductible for dependent business interruption loss. The declarations page is amended to include the following table: First Party Coverage Enhancements Limit Waiting Period Dependent Loss of Business Income $1,000,000 10 hours Business Extra Expense $1,000,000 Deductible Interruption Same as item 2a Solely for purposes of this coverage, the definition of Network is defined as: A connected system of computing hardware, software, firmware and associated electronic components and mobile devices, including industrial control systems and SCADA systems (Supervisory control and data acquisition systems) or other industrial IT, under the ownership, operation or control of, or leased by, a dependent business. H. Dependent Business Interruption-System Failure Coverage The Trust will indemnify the Covered Party for system failure dependent business interruption loss. The declarations page is amended to include the following table: First Party Coverage Enhancements Limit Waiting Period Dependent Loss of Business Income $100,000 10 hours Business Extra Expense $100,000 Deductible Interruption Same as item 2a System Failure Solely for purposes of this coverage, the definition of Network is defined as: A connected system of computing hardware, software, firmware and associated electronic components and mobile devices, including industrial control systems and SCADA systems (Supervisory control and data acquisition systems) or other industrial IT, under the ownership, operation or control of, or leased by, a dependent business. Ill. DEFENSE AND SETTLEMENT A. Defense The Trust has the right and duty to defend any claim against the Covered Party seeking damages payable under the terms of this policy, even if any of the allegations of the claim are groundless, false or fraudulent. Defense counsel may be designated by the Trust or, at the Trust's option, by the Covered Party with the Trust's written consent and subject to the Trust's guidelines. B. Settlement The Trust will have the right and duty to make, with the written consent of the Covered Party, any settlement of a claim under this policy. If the Covered Party refuses to consent to a settlement within the policy's applicable limit of liability that is recommended by the Trust and acceptable to the claimant, then the Trust's limit of liability under this policy will be reduced to the amount of damages for which the claim could have been settled plus all claim expenses incurred up to the time the Trust made its recommendation, plus an additional seventy percent (70%) of claims expenses and damages incurred by the Covered Party after the Trust had made its settlement recommendation, the total of which will not exceed the limit of liability specified in the Declarations. IV. LIMITS OF LIABILITY AND DEDUCTIBLE A. Limit of Liability-Each Claim Subject to Paragraph C. below, the Trust's limit of liability for damages and claim expenses for each claim first made and reported in writing to the Trust during the agreement period will not exceed the amount shown in Item 1.(a) in the Declarations for"Each Claim." B. Limit of Liability-Policy Aggregate The Trust's limit of liability for damages and claim expenses for all claims first made and reported in writing to the Trust during the agreement period and for all privacy notification costs payable under Insuring Agreement I.B.2 will not exceed the aggregate amount shown in Item1.(b) in the Declarations as the"Policy Aggregate," subject to the following sublimits which are part of and not in addition to the "Policy Aggregate" limit of liability: PGIT MN-700(10 20) Page 4 Print Date 9/21/2020 Agenda Page 91 1. The sublimit of liability stated in Item 1(b)(i) in the Declarations is the aggregate limit for the agreement period, for all privacy notification costs for privacy liability under Insuring Agreement l.B.2.; and 2. The sublimit of liability stated in Item 1(b)(ii) in the Declarations is the aggregate limit for the agreement period, for all regulatory fines and claim expenses for privacy liability under Insuring Agreement 1.6.3. C. Exhaustion of Limits The Trust is not obligated to pay any damages, claim expenses, or privacy notification costs or to defend or continue to defend any claim after the applicable limit of liability has been exhausted by the payment of damages, claim expenses, or privacy notification costs or any combination thereof; or after the Trust has deposited the remaining available limit of liability into a court of competent jurisdiction or tendered the remaining available limit of liability to the Covered Party or, if applicable, to the excess insurer(s) of the Covered Party. D. Deductible 1. The deductible amount shown in Item 2.(a) of the Declarations is the Covered Party's obligation for each claim and applies to the payment of damages and claim expenses. The deductible will be paid by the Covered Party. The limits of liability set forth in the Declarations are in addition to and in excess of the deductible. 2. The deductible amount stated in Item 2.(b) of the Declarations applies separately to each event or series of related events giving rise to an obligation to incur privacy notification costs for privacy liability. The deductible will be paid by the Covered Party. The sublimit set forth in Item 1.(b)(i) in the Declarations are part of and not in addition to the "Policy Aggregate" limit of liability and in excess of the deductible stated in Item 2.(b). 3. The deductible amount stated in Item 2.(c) in the Declarations applies separately to each event or series of related events giving rise to an obligation to incur regulatory fines and claim expenses for privacy liability. The deductible will be paid by the Covered Party.The sublimit set forth in Item 1.(b)(ii) in the Declarations are part of and not in addition to the "Policy Aggregate" limit of liability and in excess of the deductible stated in Item 2.(c). E. Multiple Covered Parties, Claims and Claimants 1. The limits of liability shown in the Declarations are the maximum amount the Trust will pay under this policy for damages, claim expenses and privacy notification costs, regardless of the number of Covered Parties, claims made, claimants, or events giving rise to privacy notification costs. 2. All claims arising from the same or a series of related, repeated or similar acts, errors or omissions or from any continuing acts, errors or omissions will be considered a single claim for purposes of this policy, irrespective of the number of claimants or Covered Parties involved in the claim.All such claims shall be deemed to have been made at the time of the first such claim. 3. All events giving rise to privacy notification costs arising out of a single act, error or omission or related, repeated or similar acts, errors or omissions will be considered a single event for purposes of this policy, irrespective of the number of claimants or Covered Parties involved in the event. All such events shall be deemed to have occurred and the resulting claim made at the time the Covered Party first became aware of the earliest of all such events. V. DEFINITIONS (Items listed below apply to this endorsement only; if definitions that are shown below are also defined elsewhere in the coverage agreement the definition below is the prevailing definition with respect to this endorsement.) A. Advertising means publicly disseminated material which promotes the service, business, or product of the Covered Party or a client of the Covered Party, but only where such material was disseminated at the prior written request of the Covered Party. B. Agreement Period means the period of time as stated on the Common Agreement Declarations, beginning on the effective date and expiring on the date of termination, expiration or cancellation of the Coverage Agreement, whichever is earliest. C. Assumed under contract means liability for damages for personal injury which the Covered PGIT MN-700(10 20) Page 5 Print Date 9/21/2020 Agenda Page 92 Party is required to indemnify based upon a written contract, hold harmless agreement, indemnity agreement, or similar arrangement, which document: (i)was executed by the Covered Party prior to the occurrence of the personal injury for which indemnity is sought, and (ii) requires the Covered Party to indemnify for personal injury caused in whole or in part by the content of media material used in a media communication. D. Authorized Employee means an employee of yours who is authorized by you to transfer, or to instruct others to transfer, money or securities. E. Claim means: 1. a written demand received by a Covered Party for monetary damages, including the service of suit or initiation of arbitration proceedings; 2. the initiation of a suit or arbitration proceeding against a Covered Party seeking injunctive relief; and 3. with respect to coverage provided under Insuring Clause I.B.3 only, the institution of a regulatory proceeding against the Covered Party. F. Claim Expense means: 1. Reasonable and necessary fees for the defense of a claim defended by an attorney selected by the Trust in accordance with Section III Defense and Settlement as well as other reasonable and necessary fees, costs and expenses that result from the investigation, adjustment, negotiation, arbitration, defense or appeal of a claim; and 2. Premiums on appeal bonds, attachment bonds or similar bonds. Provided, however the Trust is not obligated to apply for or furnish any such bond. G. Computer system means computer hardware, software, networks, networking equipment, applications, associated electronic devices, electronic data storage devices, input and output devices, and back up facilities operated by, owned by, leased to the Covered Party. H. Covered Party per the definition from PGIT MN-500 and the following with respects to this endorsement only: 1. independent contractors but only for media communication services performed at the direction and for the benefit of the Covered Party; Damages means any compensatory damages resulting from a judgment, award or settlement, including pre-judgement and post-judgement interest, which the Covered Party becomes legally obligated to pay as a result of a claim, and punitive, exemplary damages, and multiple damages, if the insuring of such damages is permitted under the laws and public policy of the applicable jurisdiction under which this Coverage Agreement is construed, which the Covered Party becomes legally obligated to pay as a result of a claim. Enforceability of punitive, exemplary damages and multiple damages will be governed by the applicable law that most favors affirmative coverage for such damages. Damages does not include: 1. the return, reduction, loss or restitution of fees, profits, charges, commissions or royalties for goods or services already provided or contracted to be provided, disgorgement of unjust enrichment or profits expenses or costs for media communication performed or to be performed by the Covered Party; 2. Lost investment income; 3. Costs incurred by a Covered Party to withdraw or recall technology products, including products that incorporate a Covered Party's technology products, technology services, or professional services; 4. Costs incurred by a Covered Party to correct, re-perform or complete any technology services or professional services; 5. Costs incurred by a Covered Party or by a third party at the direction of the Covered Party to remediate, repair, replace, restore, modify, update, upgrade, supplement, correct, or otherwise improve a network to a level of functionality beyond that which existed prior to a cyber security breach; 6. Civil or criminal fines or penalties or compliance violation remedies imposed on a Covered Party; provided however, civil fines or penalties shall constitute damages under insuring agreement I.D.1. PCI DSS Coverage; 7. Liquidated damages in excess of a Covered Party's liability that otherwise results from a third party wrongful act; 8. The monetary value of an electronic fund transfer or transaction that is lost or diminished; PGIT MN-700(10 20) Page 6 Print Date 9/21/2020 Agenda Page 93 9. Any amounts incurred prior to the Covered Party providing notice of a claim pursuant to the terms of this Coverage Agreement; 10. The value of non-monetary relief, including any amount attributable to or arising therefrom; or 11. Royalty or licensing fees or payments. The term "applicable jurisdiction" shall mean for the purposes of this policy that jurisdiction most favorable to the insurability of punitive or exemplary damages provided that the jurisdiction must be: a. where the punitive or exemplary damages were awarded or imposed; b. where any act which forms the basis of the claim took place; or c. where any Covered Party is incorporated, resides, or has its principal place of business. J. Data Breach means the unauthorized taking, acquisition, obtaining, use or disclosure of information on a computer system, including but not limited to personally identifiable information, charge, debit, and credit card information, banking, financial, and investment services account information, proprietary information, and personal, private, and confidential information. K. Data Breach Reporting Requirement means any provision in a law, statute or regulation, domestic or foreign, that required the covered party to provide notification to affected persons of a breach of such person's personally identifiable information or protected health information. L. Data Breach Response and Crisis Management Costs means 1. Reasonable and necessary costs charged by Breach Response Providers to: a. Determine the legal applicability of and actions necessary to respond to a data breach reporting requirement; b. Perform computer forensics to determine the existence, cause and scope of a data breach or cyber security breach; c. Notify individuals of a data breach who are required to be notified pursuant to any data breach reporting requirement; d. Voluntarily notify individuals of a data breach who may not be required to be notified; e. Operate a call center to manage data breach inquiries; f. Provide credit or identity monitoring and identity protection and restoration services or any similar service for those individuals whose personally identifiable information was or may have been breached; g. Provide medical identity restoration for those individuals whose protected health information was or may have been breached; h. Minimize harm to the Covered Party's reputation by hiring a public relations or crisis communications firm, and 2. Reasonable and necessary costs charged by any qualified provider that is not a Breach Response Provider so long as the qualified provider: a. Is pre-approved in writing by the Trust; or b. Provides comparable services to those enumerated in 1.(a)through 1.(h) above and whose rate shall not exceed the rate the Trust has pre-negotiated with the Breach Response Providers; and 3. Reasonable and necessary costs charged by PCI Forensics Investigator to perform forensics to determine the existence, cause and scope of a breach or suspected breach of cardholder data. M. Extortion Damages means money paid by a Covered Party in its capacity as such and with the Trust's prior written consent to a person reasonably believed to be making an extortion threat for the purpose of ending an extortion threat against the Covered Party. Extortion damages shall include reasonable and necessary expense incurred by a Covered Party with the Trust's prior written consent that directly relate to the Covered Party's efforts to investigate and/or end an extortion threat. It includes reasonable and necessary costs charged by (a) Breach Response Providers; or(b) qualified third parties with the prior consent of the Trust to conduct an investigation and advise the Covered Party how to respond to resolve an extortion threat. N. Extra Expense means reasonable and necessary expenses, including payroll, in excess of the covered party's normal operating expenses that the covered party incurs to reduce or avoid loss of business income and/or restore business operations. PGIT MN-700(10 20) Page 7 Print Date:9/21/2020 Agenda Page 94 O. Extortion Threat means a threat made by a third party or rogue employee demanding payment in consideration for the elimination, mitigation or removal of the threat intended to: 1. Disrupt the network to impair business operations of the Covered Party; 2. Alter, damage or destroy data stored on the network; 3. Use the network to generate and transmit malware to third parties; 4. Deface the Covered Party's website; 5. Access or release data, including personally identifiable information, protected health information; confidential business information, stored or previously stored on the network; 6. Refuse to return data stolen from the network; 7. Prevent access to the network or data by using encryption and withholding the decryption key. P. Funds Transfer Fraud Loss means loss of money or securities directly resulting from a funds transfer fraud event. Q. Funds Transfer Fraud Event means an unauthorized and fraudulent written, electronic, or telephonic instruction transmitted to a financial institution by a third party falsely purporting to be the covered party, directing such financial institution to transfer, pay, debit or deliver money or securities from the Covered Party's account without its knowledge or consent. R. Insured invoice means a printed or electronic statement of any payment owed to the Covered Party for goods, products, or services provided by same. S. Invoice Manipulation Fraud Event means the release or distribution of any fraudulent payment instructions to the Covered Party's client, customer or vendor as a direct result of a cyber security breach in order to mislead or deceive the Covered Party's client, customer, or vendor into transferring payment intended for paying an Insured Invoice to another person or entity. T. Invoice Manipulation Loss means the financial loss the Covered Party incurs directly from being unable to collect payment from the Covered Party's client, customer, or vendor for any Insured invoice directly resulting from an invoice manipulation fraud event. It does not include any profit to the Covered Party as a result of providing goods, products, or services which is the subject of such invoice manipulation loss. U. Interrelated Act means any fact, circumstance, situation, transaction, act, error, omission, or event which is based on, arising out of, or having as a common nexus any of the same or related or series of related facts, circumstances, situations, transactions, acts, errors, omissions or events. V. Malicious code means any unauthorized, corrupting, or harmful virus, Trojan Horse, worm, logic bomb or other similar software program, code or script designed to insert itself onto a computer disk or into computer memory and migrate from one computer to another. W. Matter means the content of communication, including language, data, facts, fiction, music, photographs, images, artistic expression, or visual or graphical materials. Provided, however, matter does not include technology products or products or services described, illustrated or displayed in matter. X. Media communication means the publishing, transmission, display, broadcast, web cast, dissemination, distribution or release of media material to the public by or on behalf of the Covered Party. Y. Media material means information in the form of words, sounds, numbers, images, or graphics in electronic, print, digital or broadcast form, including advertising. Z. Media Wrongful Act means any of the following resulting from the Covered Party acquiring, blogging, broadcasting, collecting, disseminating, distributing, editing, exhibiting, gathering, obtaining, posting, producing, publishing, releasing, researching, recording, tweeting or uttering, matter through traditional and/or digital methods, including cable television, radio, movie and music studios, public speaking, newspapers, magazines, books and print publications, website, apps, CD- ROMS and DVDs: 1. Libel, slander, or any other form of defamation or harm to the character or reputation of any person or entity, including product disparagement or trade libel; 2. Copyright infringement or misappropriation of property rights, information or ideas or dilution or infringement of title, slogan trademark,trade dress, logo, trade name, service mark or service name; 3. Common law unfair competition or unfair trade practices alleged as a direct result of the acts described above in sections T.1 and T.2; PGIT MN-700(10 20) Page 8 Print Date 9/21/2020 Agenda Page 95 4. Invasion or infringement of the right of privacy or publicity, including the torts of intrusion upon seclusion, publication of private facts,false light, and misappropriation of name or likeness; 5. Infliction of emotional distress or mental anguish; 6. False arrest, detention or imprisonment, harassment, trespass, wrongful entry or eviction, eavesdropping, or other invasion of the right of private occupancy; 7. Plagiarism, piracy or misappropriation of ideas under implied contracts; and AA. Money means the Covered Party's: 1. Currency,coins and bank notes in current use and having a face value; and 2. Traveler's checks and money orders held for sale to the public. BB. Cyber Security breach means: 1. any unauthorized: access to, use or misuse of, modification to the network, and/or denial of network resources by cyber-attacks perpetrated by a third party or rogue employee through any electronic means, including malware, viruses, worms, and Trojan horses, spyware and adware, zero-day attacks, hacker attacks and denial of service attacks. A series of continuing cyber security breaches or related, repeated, or similar cyber security breaches shall be considered a single cyber security breach and be deemed to have occurred at the time of the first such cyber security breach. CC. Newly acquired subsidiary means any entity newly formed or acquired by the Covered Party during the agreement period in which the Covered Party has more than fifty percent(50%) of the legal or beneficial interest, but only upon the conditions that: 1. Within sixty(60) days of such formation or acquisition,the Covered Party has provided the Trust with full particulars of such newly acquired subsidiary and the Trust has agreed in writing to insure such newly acquired subsidiary,but the Trust shall not be required to insure such newly acquired subsidiary; 2. The Covered Party has paid the additional premium, if any, charged by the Trust and has agreed to any amendment of the provisions of this policy; and 3. The Trust will only provide coverage with respect to a Claim when the act or omission is committed on or after the date such newly acquired subsidiary became a newly acquired subsidiary and prior to the date such newly acquired subsidiary ceased to be a newly acquired subsidiary.An entity ceases to be a newly acquired subsidiary under this policy on the date during the agreement period that the Covered Party's legal or beneficial interest in such entity becomes less than fifty percent(50%). DD. Period of Restoration means the time period that begins on the specific date the actual interruption of the use of the Covered Party's computer system starts and ends on the specific date that the actual interruption of the use of the computer system ends. In no event, however, shall the period of restoration mean a time period to exceed sixty (60) days. EE. Personally identifiable information means an individual's name in combination with one or more of the following: 1. information concerning the individual that constitutes"non-public personal information" as defined in the Gramm-Leach Bliley Act of 1999, as amended, and regulations issued pursuant to the Act; 2. medical or health care information concerning the individual, including "protected health information" as defined in the Health Insurance Portability and Accountability Act of 1996, as amended, and regulation issued pursuant to the Act; 3. the individual's social security number, driver's license or state identification number, credit, debit, or other financial account numbers and associated security codes, access codes, passwords or personal identification numbers (PINs)that allows access to the individual's financial account information; or 4. other non-public personally identifiable information, as protected under any local, state, federal or foreign statute or regulation. Provided, however, personally identifiable information does not mean information that is lawfully available to the public, including information from any local, state, federal or foreign governmental entity or body. FF. Personal injury means injury other than bodily injury to a third-party arising out of one or more of the following offenses by reason of a Covered Party's act, error or omission in the performance of or negligence regarding the content of any media communication: 1. false arrest, detention or imprisonment; 2. libel, slander, or other defamatory or disparaging statement or materials; PGIT MN-700(10 20) Page 9 Print Date 9/21/2020 Agenda Page 96 3. oral or written publication of material that violates an individual's right of privacy; 4. wrongful entry or eviction, or other invasion of the right of private occupancy; 5. plagiarism, piracy or misappropriation of ideas or style of doing business; and 6. infringement or misappropriation of copyright, title, slogan, trademark, trade name, trade dress, logo, service mark or service name. GG. Privacy notification costs mean reasonable and necessary: 1. costs to hire a security expert to determine the existence and cause of any theft or unauthorized access to or disclosure of personally identifiable information; 2. costs to notify consumers under a data breach reporting requirement; 3. fees incurred to determine the actions necessary to comply with a data breach reporting requirement; and 4. credit monitoring services of the affected consumers if required by data breach reporting requirement. Privacy notification costs will be paid first and will reduce the limit of liability available to pay damages. Privacy notification costs do not mean fees, costs or expenses of employees or officers of the Trust, or salaries, loss of earnings, overhead, or any other remuneration by, to or of any Covered Party. HH. Privacy policy means written documents that set forth the Covered Party's policies, standards, practices and procedures for the acquisition, obtaining, collection, use, disclosure, sharing, transmission, dissemination, correction, access to or supplementation of personally identifiable information. II. Privacy and Security wrongful act means: 1. the theft or unintentional disclosure or mishandling of personally identifiable information that is in the care, custody, or control of the Covered Party; or 2. violation of any law, statute or regulation governing the authenticity, availability, confidentiality, storage, control, disclosure, integrity,or use of personally identifiable information or protected health information; or 3. the Covered Party's unintentional failure to timely disclose a breach in violation of any data breach reporting requirement. 4. Failure to reasonably implement privacy or security practices required by law or regulations. 5. Failure to prevent a cyber security breach that results in: a.) The inability of an authorized user to gain access to the network; b.) The malicious addition, alteration, copy, destruction, deletion, disclosures, damage, removal or theft of data residing on the network; or c.) The transmission of malware from the network to third parties; or 6. Failure to comply with the Covered Party's privacy policy and/or privacy notice. JJ. Regulatory fines means any civil fine or civil monetary penalty imposed in a regulatory proceeding payable by the Covered Party to the government entity bringing such regulatory proceeding in such entity's regulatory or official capacity. KK. Regulatory proceeding means a request for information, civil investigative demand, suit, civil investigation, or civil proceeding commenced by the service of a complaint or similar pleading by or on behalf of any local, state, federal or foreign governmental entity in such entity's regulatory or official capacity which may reasonably be expected to give rise to a claim covered by this policy. LL. Subsidiary means any entity of which the Covered Party owns, either legally or beneficially, more than a fifty percent(50%) interest in such entity. On the date during the agreement period that the Covered Party's legal or beneficial ownership interest in such entity becomes less than fifty percent(50%), such entity will cease to be a subsidiary under this policy. In such event, coverage will be provided under this policy, but only with respect to acts or omissions committed prior to such date in accordance with all other terms and conditions of this policy. No coverage will be afforded under this policy with respect to claims made against a Covered Party based on any act or omission that was committed on or subsequent to such date. MM. Securities means your negotiable and nonnegotiable instruments or contracts representing either money or property, and includes tokens, tickets, revenue, and other stamps (whether represented by actual stamps or unused value in a meter) in current use, and evidences of debt PGIT MN-700(10 20) Page 10 Print Date 9/21/2020 Agenda Page 97 issued in connection with credit or charge cards, which cards are not issued by the Covered Party. NN. Social Engineering Financial Fraud Event means the transfer of money or securities to an account outside your control pursuant to instructions made by a person purporting to be an authorized employee, outsourced provider or customer of yours, when such instructions prove to have been fraudulent and issued by a person who is not an authorized employee, outsourced provider, or customer of yours. 00. Social Engineering Financial Fraud Loss means loss of money or securities directly resulting from a social engineering financial fraud event. PP. Unauthorized access means the gaining of access to computer systems by an unauthorized person or persons. QQ. PCI DSS Fines and Costs means fines, penalties, assessments, fraud recovery and operational expense recovery that the Covered Party is contractually obligated to pay under its Merchant Services Agreement(s) as the result of a PCI DSS wrongful act by the Covered Party or an outsourced provider. Provided however, PCI DSS fines and costs does not mean interchange fees, discount fees or prospective service fees. RR. PCI DSS Wrongful act means any actual or alleged cyber security breach or privacy and security wrongful act resulting in the unauthorized acquisition of cardholder data as defined under PCI-DSS. SS. Merchant Services Agreement means an agreement between the Covered Party and a financial institution, credit/debit card company, credit/debit card processor or Independent service operator enabling the covered party to accept credit card, debit card. prepaid card, or other payment cards for payments or donations. TT. Network means a connected system of computing hardware, software, firmware, and associated electronic components and mobile devises, including industrial control systems and SCADA systems (supervisory control and data acquisition systems)or other industrial IT, under the ownership, operation or control of or leased by a Covered Party. UU. Dependent Business means any entity the Covered Party relies on to conduct operations pursuant to a written contract. VV. Dependent Business Interruption Loss means: 1. loss of business income after the waiting period; 2. extra expense in excess of the applicable deductible, during the period of restoration that the covered party incurs resulting from a cyber security breach to a dependent business directly causing a total or partial interruption or deterioration in the covered party's business operations. Dependent Business Interruption Loss does not mean: 1. loss of market share or other consequential loss; 2. loss arising out of liability to any third party; 3. legal expenses; 4. loss incurred as a result of unfavorable business conditions. WW. System Failure Dependent Business Interruption Loss means 1. loss of business income after the waiting period; 2. extra expense in excess of the applicable deductible, during the period of restoration that the covered party incurs resulting from a system failure to a dependent business directly causing a total or partial interruption or deterioration in the Covered Party's business operations. System Failure Dependent Business Interruption Loss does not mean: 1. loss of market share or other consequential loss; 2. loss arising out of liability to any third party; 3. legal expenses; 4. loss incurred as a result of unfavorable business conditions. XX. System Failure means any unintentional and unplanned outage or failure of the network. YY. System Failure loss means Loss of Business income and extra expense. System Failure loss does not include losses arising out of loss of market share or any other consequential loss and any losses incurred by the covered party to upgrade, enhance, or replace the network to a condition beyond that which existed immediately prior to sustaining a system failure. ZZ. Waiting Period means the number of hours that must elapse prior to commencement of the period of restoration. AAA. Breach Response Providers means the Trust's pre-approved panel of breach response vendors. BBB. Loss of Business Income means net income(net profit or net loss before income taxes)that could have reasonably been earned or net loss that could have reasonably been avoided, including the PGIT MN-700(10 20) Page 11 Print Date:9/21/2020 Agenda Page 98 costs of retaining a forensic accountant to determine such amount. Such forensic accountant will be selected by the Trust. A loss of business income calculation is based upon the amount of actual loss of business income the Covered Party sustains per hour during the period of restoration. CCC. Rogue Employee means an employee of the Covered Party who deliberately acts outside the course and scope of employment and whose intentional conduct results in a claim or first party incident; provided, however, rogue employee does not include an executive officer. DDD. First Party Incident means a cyber security breach, extortion threat, or data breach. EEE. Third Party Wrongful Act means a media wrongful act, privacy and security wrongful act, and PCI DSS wrongful act. FFF. Technology products means computer or telecommunications hardware or software products, components or peripherals or electronic products or components, including software updates, service packs and other maintenance releases provided for such products: 1. Created, designed, distributed, manufactured, or sold by or on behalf and for the benefit of a Covered Party; or 2. Leased or licensed by a Covered Party to third parties GGG. Technology services means any computer, cloud computing, information technology, telecommunication, electronic services and any related consulting and staffing services, including data processing. data and application hosting,the provision of managed services, software as a service(SaaS), platform as a service(PaaS), infrastructure as a service (laaS), network as a service (NaaS), computer systems analysis, computer consulting and training, programming, computer systems installation, management, repair, and maintenance, network design and Internet service. HHH. Payment means currency and bank notes in current use and having a face value; and traveler's checks and money orders held for sale to the public. Payment shall not include cryptocurrency in any form III. Vendor means any person(s) or entity(s)with whom the Covered Party has entered into a written contract to provide services to the Covered Party and is not owned, operated, or controlled be a covered party. JJJ. Bricking Incident means a cyber security breach that renders a computer device or Internet of Things device(loT) non-functional for its intended purpose, only if reasonable efforts have been made and such device cannot be restored to the level of functionality that existed immediately preceding the cyber security breach. KKK. Hardware Replacement Costs means the reasonable and necessary costs to replace a computer device or Internet of Things Device with identical or commercially equivalent items that perform the same function. LLL. Internet of things device(IoT)means any nonstandard computer device that connects electronically to a network and has the ability to transmit data. MMM. Computer device means desktop and laptop computers, associated input and output devices, mobile devices, data storage devices, networking equipment and back up facilities. NNN. Crypto-Jacking Event means any unauthorized access to, use or misuse of, and/or modification to the network by cyber attacks perpetrated by a third party or rogue employee through any electronic means, including malware, viruses,worms, and Trojan Horses, spyware and adware,zero-day attacks, hacker attacks and denial of service attacks,for the purpose of mining cryptocurrency that directly results in an utility fraud loss incurred by the Covered Party. 000. Telecommunications Fraud Event means any unauthorized access to, use or misuse of, and or modification to the Covered Party's telephone system by cyber-attacks perpetrated by a third party or rogue employee through any electronic means, including malware, viruses,worms, and Trojan horses, spyware and adware, zero-day attacks, hacker attacks and denial of service attacks,which directly results in an utility fraud loss incurred by the Covered Party in the form of long-distance telephone charges. PPP. Utility Fraud Loss means an increase in service charges or fees incurred by the Covered Party resulting from the unauthorized use of any of the following utilities services: 1. electricity; 2. natural gas; 3. oil; 4. water; 5. internet access, including mobile data; 6. cable or satellite television; or 7. telephone. provided, however that such additional charges or fees for the utilities services are: PGIT MN-700(10 20) Page 12 Print Date:9/21/2020 Agenda Page 99 1. incurred pursuant to a written contract between the Covered Party and the respective utility provider, which was executed before the crypto-jacking event or telecommunications fraud event first occurred; 2. charged to the Covered Party in a periodic billing statement issued by the respective utility provider, which includes usage or consumption information; and 3. not charged at a flat fee to the Covered Party that does not scale with the rate or use of the respective utilities service our resource. VI. EXCLUSIONS This endorsement does not apply to any claim or first party incident alleging, arising out of, based upon, or attributable to: A. Deliberate Acts/Personal Profit Based upon or arising out of any dishonest, intentionally or knowingly wrongful, fraudulent, criminal or malicious act or omission by a Covered Party. The Trust will provide the Covered Party with a defense of such claim and pay claim expenses for any such suit which is brought alleging such dishonest, intentionally wrongful, fraudulent, criminal or malicious act or omission as a single allegation in a multiple allegation suit, provided any one allegation is covered under this policy. Criminal proceedings are not covered under this policy regardless of the allegations made against the Covered Party. Based upon or arising out of the gaining of any personal profit or advantage to which the Covered Party is not legally entitled. B. Prior Acts Based upon or arising out of: 1. any fact, circumstance, situation, transaction, act, error, omission, or event which, before the inception date of this policy, was the subject of any notice given under any other insurance policy; or 2. any fact, circumstance, situation, transaction, act, error, omission, or event, whenever occurring, which, together with any fact, circumstance, situation, transaction, act, error, omission, or event which has been the subject of such notice, would constitute an interrelated act. C. Bodily Injury/Property Damage Based upon or arising out of bodily injury, sickness, disease, emotional distress, mental injury, mental tension, mental anguish, pain and suffering, humiliation or shock sustained by any person, including death that results from any of these or damage to or destruction of any tangible property, including loss of use thereof whether or not damaged or destroyed; provided, however damage to or destruction of any tangible property does not include the loss of use of computer hardware resulting from a bricking incident. For the purposes of this exclusion, "tangible property" shall not include electronic data. D. Employment Practices Based upon or arising out of discrimination, humiliation, harassment, or misconduct based on an individual's race, creed, color, age, gender, national origin, religion, disability, marital status or sexual preference or other classification. The Trust will provide the Covered Party with a defense of such claim and pay claim expenses for any suit which is brought alleging such discrimination as a single allegation in a multiple allegation suit, provided any one allegation is covered under this policy. E. Ownership Claims made against the Covered Party if, at the time the third party wrongful act giving rise to such claim was committed: 1. any Covered Party controlled, owned, operated or managed the claimant; or 2. any Covered Party was an owner, partner, member, director, officer or employee of the claimant; Control of or ownership in a business enterprise is presumed if any Covered Party owned or held ten percent(10%) or more of the equity and/or debt instruments of a publicly held corporation, or forty percent(40%) or more owner voting stock of a privately held corporation. F. Covered Party v. Covered Party By or on behalf of any Covered Party under this policy against any other Covered Party hereunder; however, this exclusion shall not apply to a claim made by an employee of either the PGIT MN-700(10 20) Page 13 Prins Date.9/21/2020 Agenda Page 100 Covered Party or a subsidiary or newly acquired subsidiary otherwise covered under this insuring agreement. G. ERISA/Securities Based upon or arising out of actual or alleged violation of: 1. the Employee Retirement Income Security Act of 1974; 2. the Securities Act of 1933: 3. the Securities Exchange Act of 1934; or any rules, regulations or amendments issued in relation to such acts, or any similar state or federal statutes or regulations, including any claim based upon common law principles of liability. H. Pollution Based upon or arising out of, whether suddenly or over a long period of time, any: 1. actual, alleged or threatened emission, discharge, dispersal, seepage, release or escape of pollutants; or any injury, damage, payments, costs or expense incurred as a result of any testing for, monitoring, removal, containment,treatment, detoxification, neutralization or cleanup of pollutants; or 2. injury, damage, payments, costs or expense incurred as a result of any testing for, monitoring, removal, containment, treatment, detoxification, neutralization or cleanup of any pollutants. Contractual Based upon or arising out of any liability of others assumed by the Covered Party under any express, implied, actual, constructive, oral or written contract, agreement,warranty, guarantee, assurance, covenant, representation or promise, unless such liability would have attached to the Covered Party even in the absence of such contract or agreement; however, solely with respect to Insuring Agreement I.A., this exclusion does not apply to liability assumed under contract; J. Guarantees Based upon or arising out of any express, implied, actual, constructive, oral or written contract, agreement, warranty, guarantee, assurance, covenant, representation or promise: 1. for or relating to return on investment, cost savings, or profits; 2. for or relating to time of delivery; or 3. which creates or requires compliance with an expressed or implied duty to exercise a degree of care or skill higher than applicable industry standards. K. Advertising Based upon or arising out of: 1. fees, expenses, cost guarantees, cost representations, pricing guarantees, price representations, contract price, estimates of probable costs, or cost estimates actually or allegedly being exceeded; 2. any actual or alleged gambling, contest, lottery, promotional game or other game of chance; 3. inaccurate, inadequate, or incomplete description of the price of goods, products or services; or 4. the failure of goods, products or services to conform with any represented or implied quality or performance contained in advertising. L. Business Practice Based upon or arising out of any actual or alleged anti-trust violation, price fixing, monopolization, predatory pricing, price discrimination, restraint of trade, unfair competition, violation of consumer protection laws (except consumer privacy protection laws for claims involving a privacy wrongful act), false, deceptive or unfair trade practices, false, deceptive or misleading advertising, or violation of the Sherman Anti-Trust Act, the Clayton Act, the Robinson-Patman Act, as amended, the Federal Trade Commission Act, or any other local, state, federal, or foreign law involving monopoly, price fixing, anti-trust, predatory pricing, price discrimination, unfair competition, false, deceptive or unfair trade practices, false, deceptive or misleading advertising, consumer protection or restraint of trade. M. Patent Based upon or arising out of any actual or alleged infringement, misappropriation, dilution, misuse or inducement to infringe, misappropriate, dilute or misuse any patent or patent right. N. Privacy Based upon or arising out of: 1. telemarketing or the distribution of unsolicited email, direct mail, or facsimiles; PGIT MN-700(10 20) Page 14 Print Date.9/21/2020 Agenda Page 101 2. the collection of information by means of electronic"spiders", "spy bots", "spyware" or similar means, wire tapping or bugging, video camera, or radio frequency identification tags; or 3. the unlawful collection or acquisition of personally identifiable information, or the failure to comply with a legal requirement to allow a person to opt-in or opt-out of the Covered Party's obtaining, acquisition, compilation or use of that person's personally identifiable information. O. Governmental Action Except with respect to Insuring Agreement 1.6.3, brought by or on behalf of the Federal Trade Commission, the Federal Communications Commission, or any federal, state, local or foreign governmental entity, in such entity's regulatory or official capacity. P. Software Responsibility Based upon or arising out of any actual or alleged failure to install available software product updates and releases, or to apply security-related software patches, to computers and other components of a computer system. Q. Act of God Based upon or arising out of any actual or any way involving any actual or alleged fire, flood, earthquake, volcanic eruption, explosion, lighting, wind, hail, tidal wave, landslide, act of God or other physical event. R. Recovery of Profits, Royalties and Fees Based upon or arising out of: 1. accounting or recovery of profits, royalties, fees or other monies claimed to be due from a Covered Party or any claim brought by any such party against a Covered Party claiming excessive or unwarranted fees, compensation or charges of any kind made by a Covered Party; or 2. licensing fees or royalties ordered, directed or agreed to be paid by a Covered Party pursuant to a judgment, arbitration award, settlement agreement or similar order for the continued use of a person or entity's copyright, title, slogan trademark, trade name, trade dress, service mark, service name or other intellectual property right. S. RICO Violation of the Organized Crime Control Act of 1970 (commonly known as Racketeer Influenced and Corrupt Organizations Act, or RICO) and any regulation promulgated under or pursuant to the foregoing or any federal, state or local law analogous to the foregoing, whether such law is statutory, regulatory, or common law. T. Trade Secrets Actual or alleged misappropriation of trade secrets; provided, however this exclusion shall not apply to an otherwise covered claim directly resulting from a cyber security breach under insuring agreement I.B. U. War Strikes or similar labor action, war, whether declared or not, invasion, act of foreign enemy. civil way, mutiny, civil commotion assuming the proportions of or amounting to a popular rising, military rising, insurrection, rebellion, revolution, military or usurped power, or any action taken to hinder or defend against these actions; provided, however, this exclusion shall not apply to any actual, alleged or threated attack against the network, with the intention to cause harm to further social, ideological, religious or political objectives or to intimidate any person or entity in furtherance of such objectives. V. Infrastructure Failure electrical, mechanical, Internet, telecommunication, cable or satellite failure, fluctuation or outage not under the operational control of the Insured, however caused, including any electrical power interruption, short circuit, surge, brownout or blackout, however this exclusion shall not apple to a telecommunications fraud event. W. Governmental Orders any court order or demand requiring the Covered Party to provide law enforcement, any administrative, regulatory or judicial body or any other governmental authority access to personally identifiable information, protected health information, or confidential business information. X. Over-Redemption price discounts, prizes, awards, coupons, or any other valuable consideration given in excess of the contracted or expected amount. VII. CONDITIONS A. Reporting of Claims, Potential Claims and Events Giving Rise to Privacy Notification Costs PGIT MN-700(10 20) Page 15 Print Date:9/21/2020 Agenda Page 102 1. The Covered Party, as a condition precedent to the obligations of the Trust under this policy, will give written notice to the Trust as soon as reasonably possible during the agreement period of any claim made against the Covered Party. The Trust further agrees that the Covered Party may have up to. but not to exceed, sixty (60) days after the policy expiration to report in writing to the Trust a claim made against the Covered Party during the agreement period, if the reporting of such claim is as soon as reasonably possible. 2. The Covered Party, as a condition precedent to the obligations of the Trust under this policy,will give written notice to the Trust as soon as reasonably possible during the agreement period of any event which might reasonably be expected to give rise to privacy notification costs. 3. If during the agreement period, any Covered Party becomes aware of any act or omission which may reasonably be expected to be the basis of a claim against any Covered Party, including but not limited to any notice, advice or threat, whether written or verbal, that any person or entity intends to hold the Covered Party responsible for any alleged act or omission and gives written notice to the Trust with all available particulars, including: a. the specific act or omission; b. the dates and persons involved; c. the identity of anticipated or possible claimants; d. the circumstances by which the Covered Party first became aware of the possible claim; and e. potential damages or injury; then any claim that is subsequently made against the Covered Party arising out of such act or omission will be deemed to have been made on the date such written notice was received by the Trust. Said documents and information should be mailed to the Trust at the following address: Preferred Governmental Insurance Trust Claims Department PO Box 958456 Lake Mary, FL 32795 4. If during the agreement period the Covered Party gives written notice to the Trust of an event which might reasonably be expected to give rise to privacy notification costs,then any claim that is subsequently made against the Covered Party arising out of such event will be deemed to have been made on the date such written notice was received by the Trust. B. Assistance and Cooperation 1. The Covered Party will cooperate with the Trust and upon the Trust's request, attend hearings, depositions and trials and assist in effecting settlements, securing and giving evidence, obtaining the attendance of witnesses and in the conduct of suits and proceedings in connection with a claim or payment of privacy notification costs. 2. The Covered Party will assist in the enforcement of any right of contribution or indemnity against any person or organization who or which may be liable to any Covered Party in connection with a claim or payment of privacy notification costs. 3. The Covered Party will not, except at the Covered Party's own cost, voluntarily make any payment, assume or admit any liability or incur any expense without the prior written consent of the Trust. C. Action Against the Trust 1. No action may be brought against the Trust unless, as a condition precedent thereto: a. The Covered Party has fully complied with all the terms of this policy; and b. Other than with respect to coverage provided under Insuring Agreements I.C.2 and I.C.3, until the amount of the Covered Party's obligation to pay has been finally determined either by judgment against the Covered Party after actual trial and appeal or by written agreement of the Covered Party, the claimant and the Trust. 2. Nothing contained in this policy will give any person or organization the right to join the PGIT MN-700(10 20) Page 16 Print Date.9/21/2020 Agenda Page 103 Trust as a defendant or co-defendant or other party in any action against the Covered Party to determine the Covered Party's liability. D. Bankruptcy Bankruptcy or insolvency of the Covered Party or of the Covered Party's estate will not relieve the Trust of any of its obligations hereunder. E. Other Insurance This policy is excess over any other valid and collectible insurance, self-insurance or indemnification agreement available to the Covered Party,whether such other insurance or indemnification agreement is stated to be primary, contributory, excess, contingent, self- insurance or otherwise. F. Subrogation In the event of any payment for any damages, claim expenses or privacy notification costs under this policy, the Trust will be subrogated in the amount of such payment to all the Covered Party's rights of recovery against any person or organization. The Covered Party will execute and deliver instruments and papers and do whatever else is necessary to secure such rights. The Covered Party will do nothing to prejudice such rights. G. Changes Notice to any agent of the Trust or knowledge possessed by any such agent or by any other person will not affect a waiver or a change in any part of this policy, and will not prevent or preclude the Trust from asserting or invoking any right or provision of this policy. None of the provisions of this policy will be waived, changed or modified except by a written endorsement issued by the Trust to form a part of this policy. H. Entire Contract By acceptance of this policy the Covered Party warrants that: 1. All of the information and statements provided to the Trust by the Covered Party, including but not limited to the application and any supplemental information, are true, accurate and complete and will be deemed to constitute material representations made by the Covered Party; 2. This policy is issued in reliance upon the Covered Party's representations; 3. This policy, endorsements thereto, together with the completed and signed application and any and all supplementary information and statements provided by the Covered Party to the Trust(all of which are attached hereto and deemed to be incorporated herein) embody all of the agreements existing between the Covered Party and the Trust and shall constitute the entire contract between the Covered Party and the Trust; and 4. Any material misrepresentation or concealment by the Covered Party or the Covered Party's agent will render the policy null and void and relieve the Trust from all liability herein. Notices Any notices required to be given by the Covered Party will be submitted in writing to the Trust or its authorized representative at the address specified in the Declarations. If mailed, the date of mailing of such notice will be deemed to be the date such notice was given and proof of mailing will be sufficient proof of notice. J. Assignment No assignment of interest of the Covered Party under this policy is valid, unless the Trust's written consent is endorsed hereon. K. Innocent Covered Parties Whenever coverage under this policy would be excluded because of dishonest, fraudulent, criminal or malicious acts or omissions, the Trust agrees that such insurance as would otherwise be afforded under this policy, will be applicable with respect to those Covered Parties who did not personally participate or personally acquiesce in or remain passive after having knowledge of such conduct. Each Covered Party must promptly comply with all provisions of this policy upon learning of any concealment. L. Social Engineering Financial Fraud The coverage provided under Section II, D. shall apply only if the Covered Party verifies the instruction to transfer money or securities by following a pre-arranged callback or other established procedural method to authenticate the validity of the request prior to acting upon any transfer instruction. PGIT MN-700(10 20) Page 17 Print Date:9/21/2020 Agenda Page 104 M. Valuation Adjustment for loss related to a Bricking Incident will be computed as of the date of loss at the place of the loss and for no more than the interest of the covered party. The adjustment of loss to computer device or loT Device will be subject to the lesser of(1)the cost to repair; or(2)the cost to replace a computer device or loT Device with equipment that is the most functionally equivalent even if such equipment: (a) has technological advantages; (b) represents an improvement in function; or(c)forms part of a program or system enhancement. VIII. EXTENDED REPORTING PERIODS A. Elimination of Right to Any Extended Reporting Period There is no right to any Extended Reporting Period if the Trust cancels or refuses to renew this policy due to: 1. nonpayment of amounts due under this policy; 2. noncompliance by the Covered Party with any of the terms and conditions of this policy; or 3. any material misrepresentation or omission in the application or the supplementary information and statements provided by the Covered Party for this policy. B. Extended Reporting Period -Not a New Policy The Extended Reporting Period will not be construed to be a new policy and any claim or event giving rise to privacy notification costs reported during such period will otherwise be governed by this policy. C. Automatic Extended Reporting Period Effective upon the date of termination or cancellation of the Policy for any reason other than nonpayment of premium, the Covered Party will automatically be provided a period of sixty (60) days in which to give written notice to the Trust of: 1. Claims first made against the Covered Party during the agreement period or the automatic extended reporting period for third party wrongful acts committed by a covered party after the retroactive date and prior to the end of the agreement period; or 2. first party incidents that are first discovered by a covered party during said sixty (60) day period and otherwise covered by the Policy. D. Optional Extended Reporting Period Effective upon the date of termination or cancellation of the Policy for any reason other than nonpayment of premium, the Covered Party will have the right to purchase an Optional Extended Reporting Period of one (1), two (2), three (3), or six(6) years. Such right must be exercised by the Covered Party within sixty (60) days of the date of termination or cancellation of the Coverage Agreement by providing written notice to Preferred and remitting the amount of additional premium described below in which to provide written notice to Preferred of a claim first made against the Covered Party for a third party wrongful act committed by the Covered Party after the retroactive date and prior to the end of the coverage agreement period. The additional premium for the Optional Extended Reporting Period will be for: 1. One (1) year, one hundred percent(100% of the policy annual premium; 2. Two (2) years, one hundred fifty percent(150%) of the policy annual premium; 3. Three (3)years, one hundred seventy-five percent(175%) of the policy annual premium; 4. Six (6) years, two hundred fifty percent(250%) of the policy annual premium PGIT MN-700(10 20) Page 18 Print Date 9/21/2020 RESOLUTION NO. 2021-1 A RESOLUTION OF THE BOARD OF SUPERVISORS OF NAPLES HERITAGE COMMUNITY DEVELOPMENT DISTRICT ESTABLISHING A POLICY AND PROCEDURE FOR CERTAIN MAINTENANCE OR REPAIR CONTRACTS, INCLUDING IN A EMERGENCY SITUATION; AUTHORIZING THE DISTRICT MANAGER TO EXECUTE CERTAIN MAINTENANCE OR REPAIR CONTRACTS; PROVIDING FOR PRESENTATION OF MAINTENANCE OR REPAIR CONTRACTS APPROVED PURSUANT TO THIS POLICY AND PROCEDURE FOR INFORMATIONAL PURPOSES TO THE BOARD OF SUPERVISORS; PROVIDING FOR CONFLICTS, PROVIDING FOR SEVERABILITY AND PROVIDING AN EFFECTIVE DATE. WHEREAS, Naples Heritage Community Development District (the "District") is organized for purposes which include ownership and operation of certain infrastructure within or benefiting the commercial development known generally as Naples Heritage; and WHEREAS, throughout the year, the District encounters various instances where the facilities or infrastructure of the District require prompt maintenance or repair; and WHEREAS, it is not practical, expeditious or economical to hold meetings of the Board of Supervisors (the "Board")each time a certain maintenance or repair issue occurs; and WHEREAS, it is in the best interest of the District to ensure prompt and timely maintenance and repair of its facilities; and WHEREAS,the Board of Supervisors desires to establish updated policies and procedures for the District to allow the District Manager to carry out certain maintenance or repair items in an expeditious manner. NOW,THEREFORE,BE IT RESOLVED BY THE BOARD OF SUPERVISORS OF NAPLES HERITAGE COMMUNITY DEVELOPMENT DISTRICT: Section 1. Recitals. The foregoing recitals are true, correct and hereby incorporated as the findings of the Board. Section 2. District Manager Authority. The District Manager is hereby designated the authority to enter into contracts for the maintenance or repair of District facilities or infrastructure under the following circumstances: (i) the maintenance or repair cost will not exceed $5,000 for the subject maintenance or repair event; (ii) the total maintenance or repair cost paid to any one contractor or maintenance or repair provider under this policy will not exceed $20,000 in the 1 aggregate (including the subject maintenance or repair event) during the then-current fiscal year of the District; and(iii) such proposed maintenance or repair cost falls within an approved budget line-item of the District's budget. This policy and procedure shall stay in full force and effect until such time as the Board of Supervisors may amend or rescind the same. The District Manager is hereby designated by the District, and authorized by the District, to carry out this policy and procedure and to execute such documents as necessary to accomplish the same. Section 3. Emergency Expenditures. The District Manager is further designated the authority to enter into contracts for the maintenance or repair of District facilities or infrastructure if there is an emergency situation such that the District Manager believes the repair or maintenance is necessary to prevent a significant interruption or suspension of the District's services or otherwise necessary for the preservation and safety of persons or property. For purposes of this Section, the contract for maintenance or repair shall only be to the extent necessary to prevent or abate the emergency and any such contract shall be subject to the prior written approval of either the Chairman(or the Vice Chairman in the Chairman's absence). This policy and procedure shall stay in full force and effect until such time as the Board of Supervisors may amend or rescind the same. Subject to the requirements herein,the District Manager is hereby designated by the District, and authorized by the District, to carry out this policy and procedure and to execute such documents as necessary to accomplish the same. Section 4. Placement in Board Agenda Packet. A copy of any maintenance or repair contract approved pursuant to Section 3 or Section 4 of this Resolution shall be presented to the Board for informational purposes only at its next regularly scheduled meeting following said approval; provided, however, that any failure to present said contract shall not affect the validity or implementation of this Resolution. Section 5. Clarification of Authority. Except as otherwise provided herein, all other contracts for maintenance or repair shall be presented to the Board for the Board's approval. Section 6. Severability. Should any sentence, section, clause, part or provision of this Resolution be declared by a court of competent jurisdiction to be invalid,the same shall not affect the validity of this Resolution as a whole, or any part thereof, other than the part declared invalid. Section 7. Conflicts. All Sections or parts of Sections of any Resolutions or actions of the Board in conflict are hereby repealed to the extent of such conflict. Section 8. Effective Date. This Resolution shall become effective upon its passage and shall remain in effect unless rescinded or repealed. (Remainder of page intentionally left blank. Signatures appear on next page.) 2 PASSED AND ADOPTED at a meeting of the Board of Supervisors of Naples Heritage Community Development District, this 3rd day of November, 2020. Attest: NAPLES HERITAGE COMMUNITY DEVELOPMENT DISTRICT Ju n Fairclo ,Secretary Kenneth R. Gaynor, Ch rman 3 Agenda Page in Original Message From: sdms28(a.aol.com To: tomrutkow aaaol corn Sent: Mon, Oct 26, 2020 10:00 am Subject: Re: Naples Heritage Tom I presently live at 8675 Naples Heritage Drive. I am the end unit that sits near a pond by the 12th hole green. There is presently a mixer/circulator in the pond, so there is already power to the area. My goal would be to replace it with an aerating fountain, this would keep the water moving as well as provide something a little more ascetically pleasing. I would like to start talking to a possible contractor that does this type of work in Florida but don't want to waste anyone's time if its something the board would not allow. I would be responsible for paying for the unit and its installation. I have attached a small brochure for your review Thank you for your time Sam F. Acri 516-778-0704 (Cell) Agenda Page 113 NAPLES HERITAGE Community Development District Financial Report September 30, 2020 Prepared by 6INFRAMARK INFRASTRUCTURE MANAGEMENT SERVICES NAPLES HERITAGE Agenda Page 114 Community Development District Table of Contents FINANCIAL STATEMENTS Balance Sheet Page 1 Statement of Revenues,Expenditures and Changes in Fund Balances General Fund Page 2 SUPPORTING SCHEDULES Non-Ad Valorem Special Assessments Page 3 Cash and Investment Balances Page 4 Check Register Page 5-6 Agenda Page 115 NAPLES HERITAGE Community Development District Financial Statements (Unaudited) September 30, 2020 NAPLES HERITAGE Agenda Page 116 Community Development District General Fund Balance Sheet September 30, 2020 ACCOUNT DESCRIPTION TOTAL ASSETS Cash-Checking Account $ 34,408 Accounts Receivable-Other 393 Investments: Money Market Account 7,252 Deposits 560 TOTAL ASSETS $ 42,613 LIABILITIES Accounts Payable $ 762 TOTAL LIABILITIES 762 FUND BALANCES Nonspendable: Deposits 560 Assigned to: Operating Reserves 9,208 Reserves-Fountains 600 Reserves-Road and Lakes 30,345 Unassigned: 1,138 TOTAL FUND BALANCES $ 41,851 TOTAL LIABILITIES&FUND BALANCES $ 42,613 Page 1 NAPLES HERITAGE Agenda Page 117 Community Development District General Fund Statement of Revenues, Expenditures and Changes in Fund Balances For the Period Ending September 30, 2020 ANNUAL YTD ACTUAL ADOPTED YEAR TO DATE YEAR TO DATE VARIANCE($) AS A%OF SEP-20 SEP-20 ACCOUNT DESCRIPTION BUDGET BUDGET ACTUAL FAV(UNFAV) ADOPTED BUD BUDGET ACTUAL REVENUES Interest-Investments $ 240 $ 240 $ 531 $ 291 221.25% $ 20 $ 9 Interest-Tax Collector - - 63 63 0.00% - - Special Assmnts-Tax Collector 119,851 119,851 119,850 (1) 100.00% - - Special Assmnts-Discounts (4,794) (4,794) (4,276) 518 89.19% - - TOTAL REVENUES 115,297 115,297 116,168 871 100.76% 20 9 EXPENDITURES Administration P/R-Board of Supervisors 5,000 5,000 4,000 1,000 80.00% - - FICA Taxes 383 383 306 77 79.90% - - ProfServ-Engineering 2,000 2,000 331 1,669 16.55% - - ProfServ-Field Management 819 819 5,364 (4,545) 654.95% 819 250 ProfServ-Legal Services 3,500 3,500 5,128 (1,628) 146.51% 3,500 195 ProfServ-Mgmt Consulting Sery 22,605 22,605 22,605 - 100.00% 1,884 1,884 ProfServ-Property Appraiser 1,798 1,798 1,498 300 83.31% - - ProfServ-Web Site Maintenance 654 654 654 - 100.00% 55 55 Auditing Services 3,000 3,000 3,000 - 100.00% - - Postage and Freight 750 750 507 243 67.60% 63 4 Insurance-General Liability 8,522 8,522 7,747 775 90.91% - - Printing and Binding 900 900 14 886 1.56% - - Legal Advertising 2,400 2,400 1,792 608 74.67% - - Misc-Bank Charges 660 660 - 660 0.00% - - Misc-Assessmnt Collection Cost 2,397 2,397 2,311 86 96.41% - - Misc-Contingency 376 376 - 376 0.00% - - Misc-Web Hosting 501 501 3,203 (2,702) 639.32% - - Office Expense 410 410 108 302 26.34% - - Annual District Filing Fee 175 175 175 - 100.00/ - - Total Administration 56,850 56,850 58,743 (1,893) 103.33% 6,321 2,388 Field Contracts-Fountain 716 716 716 - 100.00% - - Contracts-Aerator Maintenance 2,350 2,350 764 1,586 32.51% - - Electricity-Aerator 3,360 3,360 4,727 (1,367) 140.68% 280 318 R&M-Fence 480 480 - 480 0.00/ - - Misc-Contingency 22,861 22,861 22,419 442 98.07% 400 400 Total Field 29,767 29,767 28,626 1,141 96.17% 680 718 Reserves Reserve-Fountain 200 200 - 200 0.00% - - Reserve-Roads and Lakes 28,480 28,480 - 28,480 0.00% - - Total Reserves 28,680 28,680 - 28,680 0.00% - - TOTAL EXPENDITURES&RESERVES 115,297 115,297 87,369 27,928 75.78% 7,001 3,106 Excess(deficiency)of revenues Over(under)expenditures - - 28,799 28,799 0.00% (6,981) (3,097) Net change in fund balance $ - $ - $ 28,799 $ 28,799 0.00% $ (6,981) $ (3,097) FUND BALANCE,BEGINNING(OCT 1,2019) 13,052 13,052 13,052 FUND BALANCE,ENDING $ 13,052 $ 13,052 $ 41,851 Page 2 Agenda Page 118 NAPLES HERITAGE Community Development District Supporting Schedules September 30, 2020 NAPLES HERITAGE Agenda Page 119 Community Development District Non-Ad Valorem Special Assessments -Collier County Tax Collector Monthly Collection Distributions For the Fiscal Year Ending September 30,2020 Discount/ Gross Date Net Amount (Penalties) Collection Amount Received Received Amount Costs Received Assessments Levied $ 119,850 Allocation % 100% 11/25/19 $ 15,382 $ 654 $ 314 $ 16,350 11/27/19 30,482 1,296 622 32,400 12/13/19 46,409 1,956 947 49,313 12/27/19 3,673 116 75 3,864 12/30/19 684 39 14 737 01/22/20 6,443 180 131 6,754 02/25/20 4,194 71 86 4,350 03/23/20 2,381 11 49 2,440 04/28/20 2,060 - 42 2,102 05/27/20 191 (6) 4 190 06/05/20 454 (14) 9 450 06/17/20 908 (27) 19 900 TOTAL $ 113,263 $ 4,276 $ 2,311 $ 119,850 % COLLECTED 100% TOTAL OUTSTANDING $ - Page 3 NAPLES HERITAGE Agenda Page 120 Community Development District Cash and Investment Balances September 30, 2020 ACCOUNT NAME BANK NAME YIELD MATURITY BALANCE GENERAL FUND Checking Account-Operating Valley National 0.25% N/A 34,408 Money Market Account BankUnited 0.30% N/A 7,252 Total $ 41,661 Page 4 N N N O V O O M S S S S N V V O S r W S N O CD n 0 N S 0 V 0 8 S 0 S S O M N S N n 0.LU--0 0 S,-N O M O O n W O V N 0 y Ep4Wp Q0 CWWCpp C 0,m m0 f9H.-0OOS M NM MHMLU 0 C 49t94,SN 00O" "49190 M,—W�F49NN GOO. 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Z 000000000000000000000000000000000 0 0 0 88 Agenda Page 124 NAPLES HERITAGE COMMUNITY DEVELOPMENT DISTRICT Motion: Assigning Fund Balance as of 9/30/20 The Board hereby assigns the FY 2020 Reserves as follows: Operating Reserve $ 9,208 Reserves-Fountain $ 600 Reserves-Roads & Lakes $30,345 Agenda Page 126 "_ Service History Report July 7,2020 SQLITUDE 50097 Naples Heritage CDD Date Range: 06/01/20..06/30/20 LAKE MANAGEMENT Toll Free: (888)480-5253 Fax: (888)358-0088 www.solitudelakemanagement.com Service Date 6/18/2020 01384880 No. PI-A00427866 Order No. SMOR-327103 Contract No. SVR13870 Technician Name and State License#s Justin Champagne Service Item# Description Lake No. Lake Name 01384880-FTN-001 Naples Herit AQUA Fountain 1 Site Site#14 FTN #14 FTN Technician's Comments: P/W fountain,checked circuits,checked and adjusted timers,checked lights,allokay, General Comments: Serviced Fountain Fountain Amps 23.4 Fountain Voltage 240v GFCI Breaker Test OK Control Breaker OK Contactor(Starter) OK Motor Overload OK Fountain Power Cable OK Fuses OK Fountain-Timer OK Shaft Propeller Impeller OK Clean Debris Screen OK Clean Nozzles OK Fountain Disconnect OK Lighting Amps .9 Lighting Voltage 120v No.of Lights Burned Out No.of Lights Replaced Clean Lights OK Lighting Timer OK Lighting Power Cable OK Fixtures OK Lenses/Seals OK Lighting Disconnect OK Agenda Page 129 Legislative Update Ch. 20-77, Laws of Fla. (Senate Bill 1466): Key Legislative Effort for the Florida Association of Special Districts Bill Passed Key Provisions: Effective Date:July 1, 2020 • Eliminates the need to post the entire agenda package on the District website. Only the agenda itself must be posted seven days prior to the meeting. • Eliminates the need to post the annual audit on the District website if the District has submitted its most recent final, complete audit to the Auditor General. A link can be included on the District website to the Auditor General's website for residents to view an annual audit for each District. Effective Date:January 1, 2021 • Eliminates some of the F.S. Chapter 112 Ethics Provisions as applicable to District Board members. Primarily this change was aimed at developer representatives on Boards. This means that Board members appointed by developers can vote on District issues that benefit developers, without fear of violating ethics provisions in Chapter 112 if certain statutory criteria are met. This is different from the conflict of interest provisions of the current law, which still apply. But represents a win for Board members appointed by developers to serve on District Boards. Ch. 20-149, Laws of Fla. (Senate Bill 664): E Verify Required for Public Employers and Contractors Bill Passed Effective Date:July 1, 2020, implementation date January 1, 2021 Key Provisions: • Public Employers (Districts), Contractors and Subcontractors for Districts must implement the E Verify system as of January 1, 2021 for all new employees. • While the law does not specify a specific time for document retention for public employers, the law requires that for private employers, E Verify forms be retained for 3 years. • This provision includes Districts that employ their own employees. Agenda Page 130 Ch. 20-173, Laws of Fla. (House Bill 101): Public Construction and Retainage Bill Passed Effective Date: October 1, 2020 Key Provisions: • Reduces to 5%the amount of retainage that Districts may withhold from each progress payment made to the contractor for construction projects. Ch. 20-154, Laws of Fla. (House Bill 279): Local Government Public Construction Works Bill Passed Effective Date:July 1, 2020 Key Provisions: • Requires local governments (including Special Districts) that complete construction projects using their own services, employees, and equipment to maintain a full accounting of the project costs, including personnel and benefit costs, direct material costs, equipment costs, maintenance costs, insurance costs, and all related costs, plus a factor of 20%for management, overhead, and other indirect costs. • Also requires local governments (including Special Districts) that issue bids or other proposals to include a listing of all government agencies that may have additional permits or fees generated by the project. Ch. 20-127, Laws of Fla. (House Bill 441): Public Procurement of Services(CCNA) Bill Passed Effective Date:July 1, 2020 Key Provisions: • This is an amendment to the Consultants' Competitive Negotiation Act. • Increases the maximum limit for a continuing contract covered by CCNA from a pre- construction price of$2,000,000 to $4,000,000. • Increases the maximum limit for procuring a study using a continuing contract from $200,000 to $500,000. Agenda Page 131 Ch. 20-114, Laws of Fla. (House Bill 5003): Implementing the 2020-2021 General Appropriations Act Bill Passed Effective Date:July 1, 2020 Key Provisions: • A special provision was slipped into the legislation that called for the creation of a one- year Local Government Efficiency Task Force that was authorized to provide recommendations on making local governments (including Special Districts) operate more efficiently. The Task Force is to provide recommendations to the Governor, President of the Senate and Speaker of the House. • The real uncertainty with this part of the Bi►l is that it is open-ended and could mean almost anything in terms of what is recommended for the local governments and special districts.