ADMINISTRATIVE REPORT
MEETING DATE: May 27, 2026 AGENDA CATEGORY: Consent - Agreements TO: Honorable Mayor and City Council
FROM: Christian Clegg, City Manager
DATE: May 11, 2026
SUBJECT: Termination of Agreement No. 2025-024 with Psychiatric Wellness Center to provide intensive case management services to justice-impacted, chronically homeless individuals
RECOMMENDATION:
Staff recommends termination of the agreement.
BACKGROUND:
In October 2024, the City released a Request for Proposals for intensive case management services funded through the Proposition 47 Grant Program. The objective of the program was to provide intensive case management services to targeted populations with the goal of reducing the number of justice-impacted individuals who enter the homeless system of care.
On February 26, 2025, the City entered into Agreement No. 2025-024 with Psychiatric Wellness Center in the amount of $858,750 to provide intensive case management services to justice-impacted, chronically homeless individuals . Section 4 of the Agreement provided that either party may terminate this agreement after giving the other party written notice ten days before the termination is effective. On May 6, 2026, Psychiatric Wellness Center notified the City of its intention to terminate the Agreement effective July 13, 2026.
In response, staff have released a new Request for Proposals to ide ntify a replacement provider for intensive case management services for justice -impacted, chronically homeless individuals under the Proposition 47 Grant Program. Staff anticipate returning to Council in June 2026 with a proposed agreement for the remaining grant funds, with the intent of onboarding the selected provider effective July 1, 2026. This timeline is intended to facilitate a period of overlap and warm handoff between providers to support continuity of care, minimize service disruptions, and ensure a smooth transition for clients currently receiving services.
FISCAL IMPACT:
The action for this program is funded through the Proposition 47 Grant Program , therefore there is no impact to the City General Fund.
COUNCIL GOAL:
Community Character & Quality of Life
ATTACHMENTS:
1. Termination Notice Letter
2. Agreement 2025-024