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W A -f-E R E R E R G Y I L I -F E <br />iiiVER$IDE <br />Wig <br />PUB+1r uiilirir:. <br />RIVERSIDE PUBLIC UTILITIES <br />Board Memorandum <br />BOARD OF PUBLIC UTILITIES <br />DATE: JANUARY 8, 2024 <br />SUBJECT: RIVERSIDE PUBLIC UTILITIES MISSION SQUARE FINANCIAL AUDIT <br />RESULTS FOR FISCAL YEARS 2016 — 2021 <br />ISSUE: <br />Consider a receive and file of the Riverside Public Utilities Financial Audit Report and Financial <br />Results for the fiscal years of 2016 - 2021. <br />RECOMMENDATION: <br />That the Board of Public Utilities receive and file the Riverside Public Utilities Audit Report and <br />Financial Results for the fiscal years of 2016 - 2021. <br />BACKGROUND: <br />On October 13, 2015, the City acquired the Mission Square Building at 3750 University Avenue <br />(Property), which was funded by Riverside Public Utilities (RPU). As such, RPU is now the <br />Landlord of the Property. The Property consists of approximately 127,533 square feet of rentable <br />office and retail space in a six -story building, plus a basement level and a 490 -parking stall garage <br />situated on approximately 2.5 acres of land. <br />On January 26, 2016, the City Council approved an Exclusive Authorization of Lease Agreement <br />with Newmark of Southern California, Inc. dba Newmark Knight Frank (NKF) for a five-year term <br />to provide broker leasing services for the Property. On January 5, 2021, the City Council approved <br />a First Amendment to California Exclusive Authorization of Lease Agreement with Newmark of <br />Southern California, Inc., dba Newmark Knight Frank (NKF) which extended the Agreement <br />through December 31, 2025. <br />On October 18, 2021, the Public Utilities Customer Relations/Finance Committee discussed the <br />Financial Best Practices for the Mission Square Building. At the meeting, staff committed to <br />contract with an external financial auditing firm to annually review the financial transactions of the <br />professional third -party commercial broker and the City for the Mission Square Operating Account. <br />The results of the audit will be provided to the Board of Public Utilities annually. <br />DISCUSSION: <br />Following an informal Request for Proposal process, Vasquez + Company LLP (Vasquez) was <br />