Thank you for doing business in the
City of Hercules.
All businesses transacting or carrying on any business in the City of Hercules must pay for and/or obtain a business license.
Businesses Located/Based in the City
Limits of Hercules:
For businesses based in Hercules, a BUSINESS USE
PERMIT is required through the Planning Department. City approval and all other license pre-requisites must be met before a business license can be issued. Examples of Use Permits:
• Temporary Use Permit
• Administrative/Minor Use Permit
• Home Occupation/Home Based Permit
• Conditional Use Permit
• Special Use Permit for Wireless Facilities
• Combined Live/Work License, Parking
Determination & Sign Permit
How to file:
Preferred Method: To remit payment online: Go to
https://hercules.bizlicenseonline.com/.
Complete a simple registration, file and pay online.
Payment Methods Available Online:
ACH Debit (Checking or Savings)
Credit Card (Visa, MasterCard, Discover)
To remit payment by form: Complete a new or
renewal business license application. Applications can
be found on our website at www.avenuinsights.com.
City of Hercules, CA (9936)
Business License Fee Schedule
and Frequently Asked Questions (FAQs)
Toll Free Phone: (866) 240-3665
Toll Free Fax: (855) 219-4338
Se habla español.
Email: [email protected]
Website: https://hercules.bizlicenseonline.com/
Mail to address:
Avenu Insights & Analytics
City of Hercules Business License Department
373 E. Shaw Avenue, Box 367
Fresno, CA 93710
Make checks payable to “Tax Trust Account”
Click on the following (or scroll to the bottom of
the document) to see more information on the
following topics:
Fee Schedule and Calculations
Gross Receipts, Definition of
FAQs
Municipal Code
Important
Information
For your information:
License Due Date: Renew annually on January 1st.
License Delinquent Date: Licenses are considered delinquent on or after February 1st of each license year.
License Expiration: Annual licenses expire December 31st of each year and must be renewed annually. Quarterly licenses expire at the end of the quarter for which licenses have been issued. Temporary licenses expire per the date printed on the official licenses.
To prevent a delay in the issuance of a license, please note the following:
• A license based on gross receipts cannot be issued until the gross receipt amount is provided, the license is paid in full and all other required pre-requisites are met.
• A license based on unit count (# of employees, # of vehicles, # of rooms, # of days, etc.) cannot be issued until the unit count is provided, the license is paid in full and all other required pre-requisites are met.
• Business license categories that require City approval, additional certification and/or documents cannot be issued until such approval/documentation is received and the license is paid in full.
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City of Hercules, CA
Renewal License Application Fee Schedule
Questions? Contact Support toll free at (866) 240-3665 or [email protected] Retail, Service, Manufacturer, Wholesale, Daycare, Short Term Lodging, Residential/Commercial Real Estate Property Rental
Licenses Calculated Based on Estimated AVERAGE MONTHLY Gross Receipts.
Instructions: Use calculation table below to calculate the ANNUAL license fees for the following business descriptions. *Annual licenses may be prorated only the first year of registration and must be renewed annually thereafter.
Businesses may prorate their first year business license fee on a quarterly basis.
Code Classification/Business Description Description
Code 1.03 Hotel, Motel, Bed & Breakfast, Short Term Lodging Code 1.04 Manufacturer
Code 1.05 Manufacturer HOME OCCUPATION
Code 1.06 Retail
Code 1.07 Retail HOME OCCUPATION
Code 1.08 Service
Code 1.09 Service HOME OCCUPATION
Code 1.10 Wholesale
Code 1.11 Wholesale HOME OCCUPATION
Code 1.12 Residential Real Estate Property Rental (1+ rental unit) Code 1.13 Residential Real Estate Property Rental (1+ rental unit) HOME OCCUPATION Code 1.14 Commercial Real Estate Property Rental (1+ property) Code 1.15 Commercial Real Estate Property Rental (1+ property) HOME OCCUPATION Average Monthly Gross
Receipts Range License Fee Due*
Average Monthly Gross
Receipts Range License Fee Due*
$0.00 to $1,000 $46.00 $35,000.01 to $40,000 $498.00
$1,000.01 to $1,500 $58.00 $40,000.01 to $45,000 $544.00 $1,500.01 to $2,000 $68.00 $45,000.01 to $50,000 $590.00 $2,000.01 to $3,000 $91.00 $50,000.01 to $60,000 $635.00 $3,000.01 to $4,000 $114.00 $60,000.01 to $70,000 $680.00 $4,000.01 to $5,000 $137.00 $70,000.01 to $80,000 $726.00 $5,000.01 to $6,000 $158.00 $80,000.01 to $90,000 $771.00 $6,000.01 to $8,000 $182.00 $90,000.01 to $100,000 $816.00 $8,000.01 to $10,000 $205.00 $100,000.01 to $130,000 $907.00 $10,000.01 to $12,000 $226.00 $130,000.01 to $160,000 $997.00 $12,000.01 to $14,000 $251.00 $160,000.01 to $200,000 $1,134.00 $14,000.01 to $16,000 $272.00 $200,000.01 to $350,000 $1,359.00 $16,000.01 to $18,000 $294.00 $350,000.01 to $500,000 $1,586.00 $18,000.01 to $20,000 $319.00 $500,000.01 to $650,000 $1,926.00 $20,000.01 to $25,000 $363.00 $650,000.01 to $800,000 $2,266.00 $25,000.01 to $30,000 $409.00 $800,000.01 to $1,000,000 $2,718.00 $30,000.01 to $35,000 $453.00
Average Monthly Gross Receipts Range Base Fee*
$1,000.000.01 to $2,000,000 (Base Fee + $1.00 per $1,000 in excess of $1M up to $2M) $2,718.00 $2,000.000.01 to $4,000,000 (Base Fee + $.80 per $1,000 in excess of $2M up to $4M) $3,851.00 $4,000.000.01 to $7,000,000 (Base Fee + $.60 per $1,000 in excess of $4M up to $7M) $5,663.00 $7,000.000.01 to $10,000,000 (Base Fee + $.40 per $1,000 in excess of $7M up to $10M) $7,703.00 Over $10,000,000 (Base Fee + $.20 per $1,000 in excess of $10M with no cap) $9,060.00 406
Contractors
Code Classification/Business Description
Code 2.01 Contractor-Located within the city limits of Hercules Note: Must renew annually
Code 2.02 Contractor-Located within the city limits of Hercules HOME OCCUPATION Note: Must renew annually
Code 2.03 Subcontractor-Located within the city limits of Hercules Note: Must renew annually
Code 2.04 Subcontractor-Located within the city limits of Hercules HOME OCCUPATION Note: Must renew annually
Code 2.05 Contractor-Out of Town
Note: Allowed to pay by quarter or annually
Code 2.06 Subcontractor-Out of Town
Note: Allowed to pay by quarter or annually
**Calculation instructions – NEW BUSINESSES
TOTAL ESTIMATED GROSS RECEIPTS divided by # of months in job this year = AVERAGE MONTHLY GROSS RECEIPTS Find AVERAGE MONTHLY GROSS RECEIPTS on the below table to determine license fee.
License fee multiplied by # of quarters operating this year = Total license fee due + CASp Fee **Calculation instructions – ANNUAL RENEWAL FOR CODES 2.01, 2.02, 2.03 or 2.04:
TOTAL ACTUAL GROSS RECEIPTS for previous year divided by 12 months = AVERAGE MONTHLY GROSS RECEIPTS Find AVERAGE MONTHLY GROSS RECEIPTS on the below table to determine license fee.
License fee multiplied by 4 quarters = Total license fee due + CASp Fee **Calculation instructions –RENEWAL FOR CODES 2.05 or 2.06:
TOTAL GROSS RECEIPTS divided by # of months in job this year = AVERAGE MONTHLY GROSS RECEIPTS Find AVERAGE MONTHLY GROSS RECEIPTS on the below table to determine license fee.
License fee multiplied by # of quarters operating this year = Total license fee due + CASp Fee Average Monthly Gross
Receipts License Fee Due**
Average Monthly Gross
Receipts License Fee Due**
$0.00 to $4,000 $29.00 per quarter $45,000.01 to $50,000.00 $148.00 per quarter $4,000.01 to $5,000.00 $36.00 per quarter $50,000.01 to $60,000.00 $158.00 per quarter $5,000.01 to $6,000.00 $41.00 per quarter $60,000.01 to $70,000.00 $171.00 per quarter $6,000.01 to $8,000.00 $46.00 per quarter $70,000.01 to $80,000.00 $182.00 per quarter $8,000.01 to $10,000.00 $51.00 per quarter $80,000.01 to $90,000.00 $193.00 per quarter $10,000.01 to $12,000.00 $58.00 per quarter $90,000.01 to $100,000.00 $205.00 per quarter $12,000.01 to $14,000.00 $63.00 per quarter $100,000.01 to $130,000.00 $226.00 per quarter $14,000.01 to $16,000.00 $68.00 per quarter $130,000.01 to $160,000.00 $251.00 per quarter $16,000.01 to $18,000.00 $74.00 per quarter $160,000.01 to $200,000.00 $284.00 per quarter $18,000.01 to $20,000.00 $79.00 per quarter $200,000.01 to $350,000.00 $340.00 per quarter $20,000.01 to $25,000.00 $91.00 per quarter $350,000.01 to $500,000.00 $397.00 per quarter $25,000.01 to $30,000.00 $103.00 per quarter $500,000.01 to $650,000.00 $482.00 per quarter $30,000.01 to $35,000.00 $114.00 per quarter $650,000.01 to $800,000.00 $568.00 per quarter $35,000.01 to $40,000.00 $125.00 per quarter $800,000.01 to $1,000,000.00 $680.00 per quarter $40,000.01 to $45,000.00 $148.00 per quarter
Average Monthly Gross Receipts
Base
Fee**
$1,000.000.01 to $2,000,000
(Base Fee + $0.25 per $1,000 in excess of $1M up to $2M = ____ multiplied by # of quarters) $680.00 $2,000.000.01 to $4,000,000
(Base Fee + $0.20 per $1,000 in excess of $2M up to $4M = ____ multiplied by # of quarters) $963.00 $4,000.000.01 to $7,000,000
(Base Fee + $0.15 per $1,000 in excess of $4M up to $7M = ____ multiplied by # of quarters) $1,415.00 $7,000.000.01 to $10,000,000
(Base Fee + $0.10 per $1,000 in excess of $7M up to $10M = ____ multiplied by # of quarters) $1,926.00 Over $10,000,000
(Base Fee + $0.05 per $1,000 in excess of $10M with no cap = ____ multiplied by # of quarters) $2,266.00 407
Miscellaneous Classifications/Business Descriptions and Fee Calculation Instructions Instructions: For the business classifications/descriptions listed below, see the Fee Calculation for instructions on how to calculate.
***If proration is allowed, annual licenses may be prorated on a quarterly basis, only the first year of registration and must be renewed annually thereafter.
Code Description/Additional Information Fee Calculation – RENEWAL RATES Code 3.01 Billiard or Pool Halls and Card Rooms-Per Table $23.00 per year per table, PLUS must pay on gross receipts. Proration allowed.
Code 3.02 Billiard or Pool Halls and Card Rooms-Gross
Receipts
Must pay on gross receipts PLUS $23.00 per year per
table
See RETAIL gross receipts table for calculation based
on gross. Proration allowed.
Code 3.03 Boxing and Wrestling Matches $114.00 per exhibition. Must report # of exhibitions.
No proration.
Code 3.04 Carnivals $568.00 per week. Must report # of weeks. No proration.
Code 3.05 Circuses $114.00 per day. Must report # of days. No proration.
Code 3.06 Coin Operated Amusement Devices $226.00 per year per device. Must report # of devices.
Proration allowed.
Code 3.07 Dances with Admission Charged $58.00 each date of event. Must provide date(s). No proration.
Code 3.08 Exempt-Must Apply Annually $0.00 license fee, but Exempt businesses must pay the CASp fee. Must provide IRS 501(c)3 annually.
Code 3.09 Farmers Market $16.00 per year. Proration allowed.
Code 3.10 Merry-Go-Rounds $11.00 per day. Must report # of days. No proration.
Code 3.11 Portable Skating Rinks $114.00 per quarter. Must report # of days. No proration.
Code 3.12
Professional (i.e. Accountant, Chiropractor,
Dentist, Engineer, Lawyer, Optometrist,
Osteopath, Physician, Surgeon, Veterinarian,
Mortician, etc.)
$182.00 per each professional per year. Must report
# of Professionals. Proration allowed.
Code 3.13 Professional-HOME OCCUPATION $182.00 per each professional per year. Must report # of Professionals. Proration allowed.
Code 3.14 Selling Bankrupt, Depreciated or Damaged Stock of Goods $453.00 per year. Proration allowed.
Code 3.15 Solicitor/Peddler $58.00 per quarter. No proration.
Code 3.16 Solicitor/Peddler-HOME OCCUPATION $58.00 per quarter. No proration.
Code 3.17 Traveling Advertising & Sales Promotion $114.00 per quarter. No proration.
Code 3.18 Traveling Exhibitions $114.00 per week. Must report # of weeks. No proration.
Code 3.19 Traveling Theatrical $23.00 per day for days 1-3. Additional $13.00 per day thereafter. No proration.
Code 3.20 Trucks Using City Streets $114.00 per truck per year. Must report # of trucks.
Proration allowed.
Code 3.21 Vending Machines $46.00 per year per machine. Must report # of machines. Proration allowed.
Code 4.01 Duplicate License Fee $5.00 per issuance of duplicate license 408
City of Hercules, CA
Business License
Frequently Asked Questions (FAQs)
Who is Avenu?
Avenu Insights & Analytics is a private company that has been contracted by the City of Hercules to administer their business licenses beginning with the license year 2018. For information regarding the City of Hercules business license, please contact Avenu at:
Avenu Insights & Analytics
City of Hercules Business License Department
373 East Shaw Ave Box 367
Fresno, CA 93710
Toll Free Taxpayer Support: (866) 240-3665
Monday through Friday 8:30 am – 5:00 pm PST
Fax: (855) 219-4338
Email: [email protected]
Online Filing: https://hercules.bizlicenseonline.com/
Who is required to have a City of Hercules business license? The City of Hercules welcomes new business enterprises, and values the many businesses that have made Hercules their home. Any person whose business is located in Hercules or conducts business in Hercules must obtain a business license. This applies to businesses operating from a place of residence (i.e., home-based businesses) or a commercial or office space. Home-based businesses are businesses where operations are completed out of the owner’s or an employee’s residence. Operations include but are not limited to computer tasks, telephone calls, paperwork, appointments, financials, sales, etc.
For information regarding exemptions, see Hercules Municipal Code Title 8. Finance, Revenue and Taxation, Chapter 6. Business License Tax, Article 3. Exemptions.
How does my new business obtain a business license?
1. Obtain the necessary use permit. All businesses – including home-based, mixed-use and live-work businesses require either an administrative or conditional use permit. For more information or to apply for a use permit, contact the Planning Department at (510) 799-8200. A separate fee is required for the use permit.
2. Complete a New Business application.
o All New Business applications must pay in accordance to the Fee Schedules outlined based on the type of business being conducted.
o All New Business applications must pay the applicable business license fees, plus the annual CASp Fee.
3. Sign and date the application.
4. Return the application to Avenu with your business license payment.
Avenu Insights & Analytics
City of Hercules Business License Department
373 East Shaw Ave Box 367
Fresno, CA 93710
Online Filing: https://hercules.bizlicenseonline.com/
Fax: (855) 219-4338
5. Note: All NEW APPLICATIONS must be approved by the City of Hercules before a business license can be issued.
Additional approval may be required depending on the type of the business being conducted.
For questions concerning the business license process, contact Avenu toll free at (866) 240-3665 or [email protected].
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How is the business license fee calculated?
Most business license categories are based on gross receipts. However, there are specific business categories based on employee count or unit count. For a list of the rate calculations, see the Fee Schedule.
How long is my license valid?
Annual licenses are valid through December 31st of each year for which they are renewed. Quarterly licenses and/or temporary licenses are valid for the date(s) specified on the official licenses.
How do I renew my business license?
You may renew online or by paper form. Avenu will mail customized renewal applications to businesses each year. However, a blank renewal application is also available on our website at http://www.avenuinsights.com/.
Double-check your business category/classification and your rate fee calculation prior to submitting your application and payment.
Errors may delay the process.
Renewal notices are only sent as a courtesy and businesses are still responsible for renewing their business license even if they do not receive a renewal notice. Failure to pay the annual business license fee before January 31st, may result in late fees. If you need assistance, please contact Avenu toll free at (866) 240-3665 or [email protected].
Where should I post my business license?
If you have a fixed place of business, the license must be posted in a visible location. If your business is mobile, carry a license with you at all times while conducting business.
What are gross receipts?
City of Hercules Municipal Code Section 8-6.102 (e) defines gross receipts as:
(e) Gross Receipts. “Gross receipts” means the total of amounts actually received or receivable from sales and the total amounts received or receivable for the performance of any act or service of whatever nature it may be, for which a charge is made or credit allowed, whether or not such act or services is done as a part of or in connection with a sale of materials, goods, wares or merchandise. Included in “gross receipts” shall be all receipts, cash, credits and property of any kind and nature, without any deduction therefrom on account of the cost of the property sold, the cost of materials used, labor or service costs, interest paid or payable, or losses or other expenses whatsoever. Excluded from “gross receipts” shall be the following:
(1) Cash discounts allowed and taken on sales.
(2) Credit allowed on property accepted as part of the purchase price, and which property may later be sold.
(3) Any tax required by law to be included in or added to the purchase price, and collected from the consumer or purchaser.
(4) Such part of the sale price of the property returned by purchasers upon recision of the contract of sale, as is refunded either in cash or by credit.
(5) Amounts collected for others where the business is acting as an agent or trustee, to the extent that such amounts are paid to those for whom collected, provided the agent or trustee has furnished the Director of Finance with the names and addresses of the others and the amounts paid to them. (6) That portion of the receipts of a general contractor which represent payments to sub-contractors, provided that such subcontractors are licensed under this Chapter and provided the general contractor furnishes the Director of Finance with the names and addresses of the sub-contractors and the amounts paid each sub-contractor. (7) Receipts of refundable deposits, except that refundable deposits forfeited and taken into income of the business shall not be excluded.
(8) As to a real estate agent or broker, the sales price of real estate sold for the account of others, except that portion which represents commission or other income to the agent or broker.
(9) As to a retail gasoline dealer, a portion of his receipts from the sale of motor vehicle fuels, equal to the motor vehicle fuel license tax imposed by and previously paid under the provisions of Part 2 of Division 2 of the Revenue and Taxation Code of the State of California.
(10) As to a retail gasoline dealer, the special motor fuel tax imposed by paragraph 4041 of Title 26 of the United States Code, if paid by the dealer or collected by him from the consumer or purchaser. (11) As to trading stamp companies, the “gross receipts” shall be measured in terms of stamp sales to merchants. (12) Receipts from the sale of real property, when such sale is merely incidental to carrying on a business. 410
What kind of permits do I need before applying for a business license? All businesses within Hercules need either an Administrative Use Permit (AUP) or Conditional Use Permit (CUP). Contact the Planning Department for additional information and applicable forms.
AUPs are issued by the Community Development Director (CDD) for uses that are generally permitted within a zoning district and usually are of low impact to the community and environment. Within 30 days of receiving and determining that an application is complete and exempt under the California Environmental Quality Act (CEQA), the CDD shall either approve, approve with conditions, or deny the application. In granting conditional approval, the Director may impose requirements and conditions with respect to location, siting, construction, maintenance, operation, duration, and overall development as deemed reasonable and necessary for the protection of adjacent properties and the public interest. If the CDD denies an AUP application, the applicant may appeal the decision to the Planning Commission, where the application shall become a conditional use permit if approved. The CDD may refer any administrative use permit application to the Planning Commission for review as a conditional use permit.
CUPs are issued by the Planning Commission for conditional uses allowed within a district. The conditional use permits will usually include conditions of approval, mandatory review periods, and expiration periods as required at the discretion of the Planning Commission. In granting conditional approval, the Planning Commission may impose requirements and conditions with respect to location, siting, construction, maintenance, operation, duration, and overall development as deemed reasonable and necessary for the protection of adjacent properties and the public interest. If the Planning Commission denies a CUP application, the applicant may appeal the decision to the City Council, where the application shall become a conditional use permit if approved. The CDD may refer any administrative use permit application to the Planning Commission for review as a conditional use permit.
If you serve alcoholic beverages, you may need to apply for a liquor license with the below agencies IN ADDITION to a City business license.
Alcoholic Beverage Control Licensing County Tax Collector 1515 Clay Street, Suite 2208 625 Court Street, Room 100 Oakland, CA 94612 Martinez, CA 94553
510-622-4970 925-646-4122
Contra Costa County Clerk Environmental Health
555 Escobar Street 2120 Diamond Boulevard Suite 200
Martinez, CA 94553 Concord, CA 94520
925-335-7900 925-692-2500
Additional examples of permits required:
• Home-based businesses: Required to obtain home-based occupation permits • Taxi operators: Required to obtain taxi permits
• Food vendors: Required to obtain operator’s permits
• Solicitors/Peddlers: Required to undergo background checks through the Police Department Note: The permit process is separate from the business license process but must be completed before a business license application will be reviewed for approval.
Do I need a business license if I work out of my home?
Yes. All home-based businesses must contact the Planning Department. An Administrative Use Permit (AUP) and Business License are required for all home-based occupations. In addition to the AUP application for home-based businesses (PDF), you may also need to provide supplemental information, statements, and/or forms for your specific business as determined by the planning staff and other supporting agencies. Visit the Planning Department link for additional information and forms.
I do minor consulting on a part-time basis. Do I have to obtain a Business license? Yes, businesses both large and small are required to obtain a Business license to comply with the City Code. 411
My business is exempt. Do I still need a City of Hercules business license? Yes. Exempt and/or non-profit businesses must still apply and renew for an annual business license. Proof of IRS exemption must be provided annually. There is no license fee for exempt businesses; however, exempt businesses must still pay the annual CASp fee and submit it with a completed form. Once received, an official City license will be issued to you. If your exemption status changes, you must contact the Business License Department toll free at (866) 240-3665 or [email protected] for a review of any additional fees due.
What if I have more than one business or more than one location? If you own more than one business, a separate business license is required for each type of business and for each location in Hercules.
I live in Hercules, but my business is located outside the city limits. What are my liabilities for the City of Hercules?
As long as you do not have a physical location inside the city limits of Hercules, there is no need to obtain a City of Hercules business permit. However, if you conduct any function of your business inside the city limits then a business license would be required. Note:
The use of a PO Box in the City of Hercules for business purposes does not constitute conducting business alone.
I have a physical location inside the city limits of Hercules; however, that location does not generate any gross receipts. Do I still need to obtain and pay for business license? Yes, if this business location is inside the city limits of Hercules and is primarily for clerical purposes and support and the actual business location is elsewhere, you will need to obtain a business license.
My business entity (Corporation, LLC, Partnership, etc.) is entirely passive and/or dormant and it is just paying a minimum fee to the Secretary of State. Is my business required to get a City Business license? Yes, if your business is registered with a Hercules location/address and as active with the Secretary of State and reporting on a business return with the FTB and IRS, it will need to obtain a business permit and license. By maintaining a business entity within the City, whether transacting public business or not, it is considered operating a business.
I just purchased a business. Can I use the business license from the previous owner? No, a business license cannot be transferred or re-assigned. As the new owner, you will need to apply for a new business license in your name.
What if I close or sell my business?
Business licenses are NOT automatically canceled. We need to hear from you. You may email us at [email protected], send written notification or call us toll free at (866) 240-3665. Please be prepared to provide the date that the business closed or was sold, the gross receipts up to that point and the name of the new owner if applicable.
What if I change the name of my business or add/delete owners? Please complete a new business application. If there is no change in FEIN, then a business license fee normally does not apply for making updates to your account. However, if the FEIN changes for your business, it is considered a new business. New business fees will apply.
What if my business has changed locations?
If your business has a change of physical address, you must complete a new business permit application and obtain approval from the Planning and Building Department before a business license can be issued. Upon approval, your business license can be updated to reflect the new location address and reissued.
How do I obtain a Federal Identification Number (FEIN)? If you have employees, you need to apply for a Federal Identification Number. Contact the local IRS Office or call toll-free (800) 829- 1040.
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Do I need to register my business name?
In most cases, you must register your business name with the County Clerk. Before you file your Fictitious Business Name Statement, research the name to insure that the name is not currently being used by someone else. While this is highly recommended by the City, it is not a requirement for obtaining a business licenses.
What if I do not respond to the business license notices? If you do not respond, you may be in violation of the Hercules City Code. As a result, collection action may be initiated against you.
The amount of any tax and penalty imposed shall be deemed a debt owed to the City.
I do not believe I conduct business in the City of Hercules. I want to be taken off your list so that I will not receive further notices regarding obtaining a business license. What do I need to do? Please contact Avenu for further information. You may contact us via email at [email protected] or call us toll free at (866) 240-3665.
Do state-licensed contractors also need a City of Hercules business license? Any person licensed as a contractor by the State Contractor’s Board must obtain a business license if they are, (1) conducting business in the City; or (2) based in the City, whether conducting business in or outside of the City.
Do I need a seller’s permit?
Every business intending to sell tangible goods, wholesale or retail, commercial or home-based, sales or repairs – requires a California seller’s Permit. For more information, please visit the website of the State Board of Equalization at http://www.boe.ca.gov/ I am a Peddler/Solicitor. How do I obtain a business license for a business located outside of the City limits? To procure a business license with the City of Hercules, please complete a new business application form at the City for each individual conducting door-to-door sales. A $60 background check fee will be assessed for each person soliciting in City limits. Please note that all peddlers & solicitors must go through the required background check to operate in Hercules whether they have previously obtained a standard City business license.
The Police Department will conduct the background checks and notify the Finance Department of clearance. Once approved by the Police Department, the business license application may be processed after the fee is paid.
What is the CASp fee that I see on your forms, and do I have to pay it? On September 19, 2012, Governor Brown signed Senate Bill 1186 (SB 1186) into law. SB 1186 is intended to increase disability access, encourage compliance with construction-related accessibility requirements, develop education resources for businesses, and facilitate compliance with Federal and State disability laws. From January 1, 2013, and until December 31, 2017, cities and counties were required to collect a State mandated fee of $1.00 from “any applicant for a local business license or equivalent instrument or permit, and from any applicant for the renewal of a business license or equivalent instrument or permit.” Assembly Bill 1379 was passed on October 11, 2017 which extends the assessment of the fee indefinitely and also the State mandated fee from $1.00 to $4.00 from January 1, 2018 until December 31, 2023.
The City is required by law to inform you of the following: Under Federal and State law, compliance with disability access laws is a serious and significant responsibility that applies to all California building owners and tenants with buildings open to the public. You may obtain information about your legal obligations and how to comply with disability access laws at the following agencies:
The Division of the State Architect at https://www.dgs.ca.gov/DSA The Department of Rehabilitation at https://www.dor.ca.gov The California Commission on Disability Access at https://www.dgs.ca.gov/CCDA Where can I locate a copy of the City Municipal Code?
You can locate a copy of the City of Hercules Municipal Code on the City’s website at http://www.codepublishing.com/CA/Hercules/ (Departments & Services → City Clerk → Municipal Code)
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I applied for my business license. Why haven’t I received it yet? New business applications must be approved by the City before an official license can be issued. For questions regarding the business license process, contact Avenu toll free at (866) 240-3665 or [email protected]. A delay in the issuance of a new or renewal business license can be due to one or more of the following reasons:
• Underpaid
• Missing gross receipts
• Missing unit count - Units may refer to number of employees, number of vehicles, square footage, etc. • City approval
• Missing certifications or permits
• Outstanding delinquent license year(s) on file
Other Agencies Phone Numbers
Better Business Bureau: (510) 238-1000
California Secretary of State
Main Number: (916) 653-3595
Corporations: Extension #1
Limited Liability Company, Limited Partnerships, Trade & Service Names: Extension #3 Notary: Extension #4
Contractors State License Board: (800) 321-2752
Child Care Licensing & Fingerprinting: (510) 622-2602
Community Care
1515 Clay Street, Suite 1102
Oakland, CA 94612
Small Business Development Center: (925) 646-5377
(Formerly called Business Resource Center, Private Industry Council of CCC) 414
DISCUSSION AND/OR ACTION
AGENDA ITEM
4. 22-785
415
STAFF REPORT TO THE CITY COUNCIL
DATE: February 27, 2024
TO: Mayor and Members of the City Council
VIA: Dante Hall, City Manager
SUBMITTED BY: Edwin Gato, Director of Finance
SUBJECT: Consideration of Adopting a Resolution Electing to Retain the Housing Assets and Functions Previously Performed by the Hercules Redevelopment Agency
RECOMMENDED ACTION:
Adopt a resolution electing to retain the housing assets and functions previously performed by the Hercules Redevelopment Agency pursuant to Health and Safety Code Section 34176.
BACKGROUND:
The Hercules Redevelopment Agency (“Agency”) was dissolved on February 1, 2012, under California Redevelopment Dissolution Law (Health and Safety Code or “HSC” Section 33000 et seq.). The City elected to become the Successor Agency to the Hercules Redevelopment Agency (“Successor Agency”) to wind down non-housing assets and liabilities.
The City did not elect to become the Housing Successor to the Hercules Redevelopment Agency (“Housing Successor”) to retain housing assets and functions. The City declined the role of Housing Successor in 2012 because there was no funding for the management or monitoring of housing assets and functions at the time, and because the City believed the Contra Costa County Housing Authority (“Housing Authority”) would take responsibility of Agency housing assets.
HSC 34176(b) states if a city does not elect to become Housing Successor, that role shall be transferred to the local housing authority. The Housing Authority automatically became 22-785
416
the Housing Successor by operation of law. However, when the City attempted to transfer Agency assets to the Housing Authority, the Housing Authority declined Housing Successor responsibilities. The California Department of Finance (“DOF”) wrote a letter to the Housing Authority dated September 17, 2012, explaining they do not have the legal basis for declining the role of Housing Successor Agency (Attachment 1, Exhibit A).
A letter from the Housing Authority to DOF dated September 21, 2012 (Attachment 1, Exhibit B) states that the United States Department of Housing and Urban Development (“HUD”) provides funding to the Housing Authority to manage Section 8 and other housing programs.
HUD prohibits housing authorities from using such funding for other purposes. The Housing Authority did not formally accept the Agency’s housing assets to avoid jeopardizing HUD funding.
The Housing Authority’s refusal of Housing Successor responsibilities has left 45 loans with an outstanding balance of over $4.3 million and $5.3 million in deposits from loan repayments in a state of limbo since 2012. The City does not have the legal authority to administer loans and spend money generated by Agency housing assets (“Housing Asset Funds”) because they are restricted as Housing Successor assets under HSC 34176 and 34176.1.
ANALYSIS:
Housing Authority Discussions
On September 27, 2022, City Council authorized staff to initiate discussions and negotiate an agreement with the Housing Authority to legally transfer the role of Housing Successor, including all housing assets and functions of the Agency, from the Housing Authority to the City. This will allow the City to actively administer the $4.3 million in outstanding loans and access the $5.3 million in Housing Asset Funds to pay for Housing Successor administrative costs and affordable housing development.
During communications with the Housing Authority’s Executive Director, the Authority acknowledged the City’s desire to reclaim its status as Housing Successor Agency. The City sent a letter informing the Housing Authority of the City’s intent to elect to become Housing Successor at this time.
Housing Successor Assets
Agency housing assets include:
45 loans receivable with an outstanding balance of over $4.3 million owed to the Housing Successor
$5.3 million in cash from loan repayments deposited into the Agency’s Low- and Moderate-income Housing Fund; these monies would be transferred to a new Low417 and Moderate-Income Housing Asset Fund set up by the City as Housing Successor (“Housing Asset Fund”)
The Housing Asset Transfer List (Attachment 1, Exhibit C) provides a detailed list of loans receivable at the time of dissolution.
Housing Successor Responsibilities and Costs
If the City becomes Housing Successor, it will incur costs to administer loans, prepare annual reports due to the California Department of Housing and Community Development (“HCD”), and report on the Housing Asset Fund in the City’s audited financial statements.
Administrative costs are estimated to be $200,000 to $225,000 in the first year to set up the Housing Asset Fund, catch up on annual reports, and review outstanding loan balances and payoff status. Ongoing annual administrative costs are estimated to be $100,000 to $150,000 based on a review of other housing successors. State law permits a maximum annual administrative allowance of $200,000 per year adjusted for inflation. The limit in fiscal year 2022-23 was $254,500.
The Housing Successor may also incur costs to fund affordable housing development and homeless prevention and rapid rehousing activities described in the next section.
Housing Successor Opportunities
Housing Asset Funds may be spent on affordable housing development for extremely low to low income households. There are three major requirements on how the funds may be spent:
at least 30% of Housing Asset Funds must be spent assisting extremely low income rental housing,
no more than 20% of Housing Asset Funds may assist low income households (60- 80% of the Area Median Income), and
no more than 50% of units assisted may be restricted to seniors.
Housing Successors may also spend up to $250,000 per year on homelessness prevention and rapid rehousing services, if eligible. Hercules is most likely eligible because the Agency met its inclusionary housing production obligations as of 2009; eligibility would be confirmed after analyzing housing activity between 2009-2012.
If the City becomes Housing Successor, it should set-aside at least $500,000 to $1 million in Housing Asset Funds for administrative costs from the $5.3 million Housing Asset Fund balance funded by prior loan repayments. The remainder could be used to assist affordable housing. It is important to note there is no ongoing revenue source for housing successors.
The only revenue source for the Hercules Housing Successor is loan repayments. If the 418
Housing Successor assists affordable housing development, the assistance is commonly structured as a 55-year loan.
FISCAL IMPACT:
Adoption of the resolution will enable the City to actively administer and collect payments on $4.3 million in outstanding loans issued by the Agency and spend approximately $5.3 million in Housing Asset Funds that have accumulated since the dissolution of redevelopment in 2012.
ATTACHMENTS:
1. Resolution electing to retain the housing assets and functions previously performed by the Hercules Redevelopment Agency pursuant to Health and Safety Code Section 34176
2. Exhibit A – DOF Letter to CCC Housing Authority
3. Exhibit B – CCC Housing Authority’s Response to DOF Letter
4. Exhibit C - Hercules Redevelopment Agency Housing Assets List 419
1 RESOLUTION NO. __
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES ELECTING TO
RETAIN THE HOUSING ASSETS AND HOUSING FUNCTIONS PREVIOUSLY
PERFORMED BY THE HERCULES REDEVELOPMENT AGENCY PURSUANT TO HEALTH AND SAFETY CODE SECTION 34176
WHEREAS, the City of Hercules (“City”) is a California municipal corporation; and WHEREAS, the Hercules Redevelopment Agency (“Agency”) was a public body, corporate and politic established by adoption of City Ordinance No. 168 on October 13, 1982 and organized under the California Community Redevelopment Law (California Health and Safety Code (“HSC”) Sections 33000 et seq.); and WHEREAS, on December 29, 2011, the California Supreme Court issued its final decision in the litigation of California Redevelopment Association v. Matosantos, upholding Assembly Bill x1 26 (codified as HSC 34161-34191) (“ABx1 26”) and invalidating Assembly Bill x1 27 (the legislation that would have permitted redevelopment agencies to continue operation if their sponsoring jurisdiction agreed to make certain payments for the benefit of schools and special districts); and as a result, all California redevelopment agencies were dissolved, effective February 1, 2012; and WHEREAS, HSC 34176(a) enables the City to elect to retain the housing assets and functions previously performed by the Agency, as a housing successor. If the City elects to do so, all rights, powers, duties, obligations, and housing assets, excluding any amounts on deposit in the Low- and Moderate-Income Housing Fund (“Housing Fund”) and enforceable obligations retained by the successor agency, shall be transferred to the City; and
WHEREAS, on January 10, 2012, the City elected not to retain the housing assets and functions of the Agency by adoption of Resolution No. 12-005; and WHEREAS, HSC 34176(b) states if a city does not elect to retain the housing functions previously performed by a redevelopment agency, all rights, powers, assets, duties and obligations associated with the housing activities of the former redevelopment agency shall be transferred to the local housing authority in the territorial jurisdiction of the former redevelopment agency; and
WHEREAS, the Contra Costa County Housing Authority (“Housing Authority”) became the Housing Successor to the Hercules Redevelopment Agency (“Hercules Housing Successor”) by operation of law pursuant to HSC 34176(b). This was documented in a letter from the California Department of Finance (“DOF”) to the Housing Authority dated September 17, 2012 (attached hereto as Exhibit A); and
WHEREAS, the Housing Authority never formally accepted nor had control over the housing assets of the former Agency. A letter from the Housing Authority to DOF dated 420
2 September 21, 2012 (attached hereto as Exhibit B) states that the United States Department of Housing and Urban Development (“HUD”) provides funding to the Housing Authority to manage Section 8 and other housing programs. HUD prohibits housing authorities from using such funding for other purposes. The Housing Authority did not formally accept the Agency’s housing assets to avoid jeopardizing HUD funding; and WHEREAS, over twelve years have passed since the dissolution of the Agency. The City would like to formally accept the role of the Hercules Housing Successor so it can legally administer housing assets and functions of the former Agency, such as outstanding loans issued to low income homeowners by the former Agency who request payoff and refinancing; and
WHEREAS, the City wishes to express its intention to have the City assume all rights, powers, assets, liabilities, duties, and obligations associated with the housing activities of the Agency.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Hercules that the City Council hereby:
(1) Rescinds Resolution No. 12-005 that elected not to retain the housing assets and functions of the Agency.
(2) The City Council now elects to have the City of Hercules retain the housing assets and functions previously performed by the Hercules Redevelopment Agency in accordance with HSC Section 34176. This includes:
a) Any real property, interest in, or restriction on the use of real property, whether improved or not, and any personal property provided in residences, including furniture and appliances, all housing-related files and loan documents, office supplies, software licenses, and mapping programs, that were acquired for low- and moderate-income housing purposes, either by purchase or through a loan, in whole or in part, with any source of funds.
b) Any funds that are encumbered by an enforceable obligation to build or acquire low- and moderate-income housing, as defined by the Community Redevelopment Law (Part 1 (commencing with Section 33000)) unless required in the bond covenants to be used for repayment purposes of the bond.
c) Any loan or grant receivable, funded from the Housing Fund, from homebuyers, homeowners, nonprofit or for-profit developers, and other parties that require occupancy by persons of low or moderate income as defined by the Community Redevelopment Law (Part 1 (commencing with Section 33000)).
421
3 d) Any funds derived from rents or operation of properties acquired for lowand moderate-income housing purposes by other parties that were financed with any source of funds, including residual receipt payments from developers, conditional grant repayments, cost savings and proceeds from refinancing, and principal and interest payments from homebuyers subject to enforceable income limits.
e) A stream of rents or other payments from housing tenants or operators of low- and moderate-income housing financed with any source of funds that are used to maintain, operate, and enforce the affordability of housing or for enforceable obligations associated with low- and moderate-income housing.
f) Repayments of loans or deferrals owed to the Housing Fund pursuant to subparagraph (G) of paragraph (1) of subdivision (d) of Section 34171, which shall be used consistent with the affordable housing requirements in the Community Redevelopment Law (Part 1 (commencing with Section 33000)).
(3) Exhibit C attached to this Resolution presents a Housing Asset Transfer List documenting known assets to be retained by the City. The City shall retain all revenues generated by such assets from February 1, 2012, as permitted by HSC 34176 and 34176.1.
(4) Pursuant to HSC 34175(a), amounts on deposit in the Housing Fund upon dissolution are excluded from assets transferred from the Agency to the Hercules Housing Successor.
(5) The Successor Agency to the Hercules Redevelopment Agency (“Successor Agency”) conducted a Low- and Moderate-Income Housing Asset Fund Due Diligence Review (“DDR”) as required by HSC 34179.6. The DDR determined the Housing Fund amounts on deposit upon dissolution that were available for distribution to taxing entities.
(6) The California Department of Finance made a determination on October 21, 2016, that the total amount of Housing Funds available upon dissolution was $213,689.
The Successor Agency remitted this amount to the Contra Costa County AuditorController on October 28, 2016. (7) No other pre-dissolution Housing Funds are available. All funds generated by Agency housing assets excluding the aforementioned DDR payment are to be retained as Low- and Moderate-Income Housing Asset Funds by the City as Hercules Housing Successor as permitted by HSC 34176 and 34176.1. (8) The City Manager and their designee(s) are directed to take other and further actions, and sign such other and further documents, as is necessary in order to implement this Resolution on behalf of the City.
422
4 The foregoing Resolution was duly and regularly adopted at a regular meeting of the City Council of the City of Hercules held on the 27th day of February 2024 by the following vote of the Council:
AYES:
NOES:
ABSENT:
ABSTAIN:
____________________________
Dan Romero, Mayor
ATTEST:
Eibleis Melendez, City Clerk
423
5 EXHIBIT A
DOF LETTER DATED SEPTEMBER 17, 2012
424
6 EXHIBIT B
HOUSING AUTHORITY LETTER DATED SEPTEMBER 21, 2012
425
7 EXHIBIT C
HERCULES HOUSING ASSET TRANSFER LIST
426
427
428
429
Former Redevelopment Agency: City of Hercules Redevelopment Agency Successor Agency to the Former
Redevelopment Agency:
Entity Assuming the Housing Functions
of the former Redevelopment Agency:
Entity Assuming the Housing Functions
Contact Name: Title Phone
Entity Assuming the Housing Functions
Contact Name: Title Phone
The following Exhibits noted with an X in the box are included as part of this inventory of housing assets:
Exhibit A - Real Property
Exhibit B- Personal Property
Exhibit C - Low-Mod Encumbrances
Exhibit D - Loans/Grants Receivables X
Exhibit E - Rents/Operations
Exhibit F- Rents
Exhibit G - Deferrals
Prepared By: RSG, Inc.
Date Prepared: February 2, 2018
E-Mail Address
E-Mail Address
All assets transferred to the entity assuming the housing functions between February 1, 2012 and the date the exhibits were created are included in this housing assets list.
DEPARTMENT OF FINANCE
HERCULES REDEVELOPMENT AGENCY HOUSING ASSETS LIST
ASSEMBLY BILL X1 26 AND ASSEMBLY BILL 1484
(Health and Safety Code Section 34176)
430
Exhibit A - Real Property
Current Status Item #
Carrying Value
of Asset
Total
square
footage
Is the property
encumbered
by a low-mod
housing
covenant?
Source of lowmod housing
covenant
Date of
transfer to
Housing
Successor
Agency
Construction
or acquisition
cost funded
with Low-Mod
Housing Fund
monies /f
Construction
or acquisition
costs funded
with other
RDA funds
Construction
or acquisition
costs funded
with non-RDA
funds
Date of
constructio
n or
acquisition
by the
former RDA
Interest in real
property (option to
purchase,
easement, etc.)
1 2
3 4
5 6
7 8
9 10
11 12
13 14
15 16
17 18
19 20
Type of Asset
Square footage
reserved for lowmod housingLegal Title and
Description
City of Hercules Redevelopment Agency
Inventory of Assets Received Pursuant to Health and Safety Code section 34176 (a) (2) 431
Exhibit B - Personal Property
Item #
Carrying Value
of Asset
Date of
transfer to
Housing
Successor
Agency
Acquisition
cost funded
with Low-Mod
Housing Fund
monies
Acquisition
costs funded
with other RDA
funds
Acquisition
costs funded
with nonRDA funds
Date of
acquisition by
the former
RDA
1 2
3 4
5 6
7 8
9 10
11 12
13 14
15 16
17 18
19 20
Type of Asset Description
City of Hercules Redevelopment Agency
Inventory of Assets Received Pursuant to Health and Safety Code section 34176 (a) (2) 432
Exhibit C - Low-Mod Encumbrances
Item #
Contractual
counterparty
Total amount
currently
owed for the
Enforceable
Obligation
Is the property
encumbered
by a low-mod
housing
covenant?
Source of
low-mod
housing
covenant
Current
owner of
the
property
Construction
or acquisition
cost funded
with Low-Mod
Housing Fund
monies
Construction or
acquisition
costs funded
with other RDA
funds
Construction
or acquisition
costs funded
with non-RDA
funds
Date of
construction or
acquisition of
the property
1 2
3 4
5 6
7 8
9 10
11 12
13 14
15 16
17 18
19 20
City of Hercules Redevelopment Agency
Inventory of Assets Received Pursuant to Health and Safety Code section 34176 (a) (2) Date contract for
Enforceable
Obligation was
executed
Type of housing
built or acquired
with enforceably
obligated funds a/
433
Exhibit D - Loans/Grants Receivables
Item #
Amount of the loan
or grant
Date the loan or
grant was
issued
Purpose for which
the funds were
loaned or granted
Are there
contractual
requirements
specifying the
purposes for which
the funds may be
used?
Repayment date,
if the funds are
for a loan
Interest rate
of loan
Balance as of
February 1,
2012¹
Current
outstanding
loan balance
1 $35,000 1/15/05 FTHB Yes 03/01/15 3% $35,000 $0
2 $27,799 7/22/08 R&B Yes 09/01/18 3% $27,799 $23,547
3 $30,000 8/11/05 FTHB Yes 10/01/15 3% $30,000 $0
4 $20,457 6/28/07 R&B Yes 08/01/17 3% $20,457 $1,868
5 $25,000 1/10/06 R&B Yes 03/01/16 3% $25,000 $0
6 $50,000 1/18/08 FTHB Yes 03/01/18 3% $50,000 $0
7 $35,000 6/2/04 CItywide Yes 08/01/14 0% $0 $35,000
8 $396,488 10/3/07 Loss Mit Yes 11/01/07 4% $396,488 $509,039 9 $74,000 9/17/10 FTHB Yes 11/01/20 3% $74,000 $0
10 $75,000 8/22/08 FTHB Yes 10/01/18 3% $75,000 $73,502 11 $35,000 8/22/08 CItywide Yes 10/01/18 0% $0 $35,000
12 $25,000 9/23/08 R&B Yes 11/01/18 3% $25,000
13 $75,000 11/1/10 FTHB Yes 12/01/20 3% $75,000 $0
14 $50,000 4/13/07 FTHB Yes 06/01/17 3% $50,000 $0
15 $1,895 10/24/04 Emergency Repair Yes 12/01/04 3% $1,895 $0 16 $75,000 10/9/08 FTHB Yes 12/01/18 3% $75,000 $64,837 17 $35,000 1/15/10 R&B Yes 02/01/20 3% $35,000 $24,110
18 $75,000 2/28/08 FTHB Yes 04/01/18 3% $75,000 $0
19 $30,000 8/24/05 FTHB Yes 10/01/15 3% $30,000 $0
20 $38,000 10/15/09 FTHB Yes 11/01/19 3% $38,000 $41,161 21 $45,800 10/9/08 FTHB Yes 12/01/18 3% $45,800 $0
22 $75,000 1/13/10 FTHB Yes 02/01/20 3% $75,000 $0
23 $35,000 1/13/10 CItywide Yes 02/01/20 0% $0 $0
24 $41,000 6/29/10 FTHB Yes 08/01/20 3% $41,000 $37,782 25 $31,000 10/22/04 FTHB Yes 12/01/14 3% $31,000 $21,398 26 $10,000 5/1/06 Emergency Repair Yes 07/01/06 3% $10,000 $8,293 27 $25,000 5/1/06 R&B Yes 07/01/16 3% $25,000 $28,183
28 $46,500 12/20/05 FTHB Yes 01/01/16 3% $46,500 $36,004 29 $52,000 7/16/08 FTHB Yes 09/01/18 3% $52,000 $0
30 $64,000 12/23/08 FTHB Yes 02/01/19 3% $64,000 $0
31 $32,000 12/23/08 CItywide Yes 02/01/19 0% $0 $0
32 $50,000 4/26/06 FTHB Yes 06/01/16 3% $50,000 $0
33 $334,170 10/13/08 Loss Mit Yes 12/01/08 4% $334,170 $532,187 34 $50,000 3/23/06 FTHB Yes 05/01/16 3% $50,000 $0
35 $34,800 6/28/10 FTHB Yes 08/01/20 3% $34,800 $0
36 $75,000 2/18/10 FTHB Yes 04/01/20 3% $75,000 $0
37 $297,420 12/22/08 Haskins, Pamela Loss Mit Yes 08/01/20 3% $297,420 $423,919 Frazier, Alisa
Frazier, Alisa
Gong, Karen
Grigsby, Angela
Hadgu, Negassi
Esposito, Martin
Evangelista, Amee
Fong, Michelle
Foster, La Shauna
Foster, La Shauna
Dominguez, Maria
Dominguez, Maria
Drumin, Shirley
Erandio, Alvin
Esposito, Martin
Churchill, Earl
Colvin , Ronald
Crowell, Irene
Cruz, Donald
Diggs, Debra
Briggs, Maria
Bright, Douglas
Buksh, Rehana
Caparas, Christopher
Chao, Sonny
Aubrey, Kenny
Aubrey, Kenny
Avina, Kryshna
Bodwin, Lucas
Bodwin, Lucas
Abria, Helen
Acosta, Rafelia
Adams, Alfred
Alamer, Ghadah
Anukpui, Desiree
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
City of Hercules Redevelopment Agency
Inventory of Assets Received Pursuant to Health and Safety Code section 34176 (a) (2) Was the Low-Mod
Housing Fund
amount issued for a
loan or a grant?
Person or entity to
whom the loan or
grant was issued
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan Aben, Frederick
Loan
Loan
Loan
Loan
Loan
Loan
434
38 $50,000 12/22/08 FTHB Yes 02/01/19 3% $50,000 $57,217 39 $37,980 5/15/08 FTHB Yes 07/01/18 3% $37,980 $0
40 $35,000 5/15/08 CItywide Yes 07/01/18 0% $0 $0
41 $65,000 2/9/09 FTHB Yes 04/01/19 3% $65,000 $0
42 $72,300 7/3/08 FTHB Yes 09/01/18 3% $72,300 $0
43 $39,200 9/5/08 FTHB Yes 09/01/18 3% $39,200 $0
44 $19,600 9/5/08 CItywide Yes 09/01/18 0% $0 $19,600
45 $35,500 10/22/04 FTHB Yes 12/01/14 3% $33,500 $0
46 $39,900 8/23/05 FTHB Yes 10/01/15 3% $39,900 $0
47 $12,159 4/19/07 R&B Yes 07/01/17 3% $12,159 $0
48 $25,000 1/19/06 R&B Yes 03/01/16 3% $25,000 $21,019
49 $24,906 5/20/08 R&B Yes 07/01/18 3% $24,906 $0
50 $35,000 5/23/05 CItywide Yes 07/01/15 0% $0 $0
51 $48,000 9/10/09 FTHB Yes 10/01/19 3% $48,000 $0
52 $23,898 5/13/08 R&B Yes 07/01/18 3% $23,898 $20,216
53 $45,000 7/25/08 FTHB Yes 10/01/18 3% $45,000 $0
54 $75,000 10/7/08 FTHB Yes 12/01/18 3% $75,000 $0
55 $75,000 2/11/08 FTHB Yes 04/01/18 3% $75,000 $0
56 $35,000 7/2/08 R&B Yes 08/01/18 3% $35,000 $26,478
57 $25,000 6/23/08 R&B Yes 08/01/18 3% $25,000 $0
58 $69,800 9/23/08 FTHB Yes 11/01/18 3% $69,800 $0
59 $75,000 3/12/08 FTHB Yes 04/01/18 3% $75,000 $0
60 $75,000 12/11/08 FTHB Yes 02/01/19 3% $75,000 $0
61 $50,000 9/22/06 FTHB Yes 12/01/16 3% $50,000 $0
62 $24,999 1/12/09 R&B Yes 03/01/19 3% $24,999 $23,018
63 $456,460 6/22/09 Loss Mit Yes 08/01/09 4% $456,460 $375,010 64 $47,000 1/27/10 FTHB Yes 02/01/20 3% $47,000 $0
65 $57,000 4/17/08 FTHB Yes 06/01/18 3% $57,000 $0
66 $46,800 10/17/05 FTHB Yes 12/01/15 3% $46,800 $56,889 67 $60,200 2/12/10 FTHB Yes 02/01/20 3% $60,200 $0
68 $52,000 8/19/10 FTHB Yes 10/01/20 3% $52,000 $0
69 $35,500 8/25/05 FTHB Yes 09/01/15 3% $35,500 $25,550 70 $66,000 9/1/09 FTHB Yes 10/01/19 3% $66,000 $0
71 $71,000 10/7/10 FTHB Yes 12/01/20 3% $71,000 $0
72 $190,927 8/13/09 Loss Mit Yes 10/01/09 5% $190,927 $0 73 $35,000 5/7/04 CItywide Yes 07/01/14 0% $0 $0
74 $25,000 5/7/04 FTHB Yes 06/01/14 3% $25,000 $0
75 $23,905 4/16/09 R&B Yes 06/01/19 3% $23,905 $0
76 $50,000 9/6/06 FTHB Yes 11/01/16 3% $50,000 $0
77 $56,600 6/11/08 FTHB Yes 09/01/18 3% $56,600 $0
78 $32,600 2/24/05 FTHB Yes 04/01/15 3% $32,600 $0
79 $212,474 4/20/10 Loss Mit Yes 06/01/10 4% $212,474 $297,010 80 $70,000 9/1/09 FTHB Yes 10/01/19 3% $70,000 $0
81 $75,000 7/10/08 FTHB Yes 09/01/18 3% $75,000 $0
82 $31,000 11/2/10 CItywide Yes 01/01/21 0% $0 $0
83 $219,826 10/29/08 Loss Mit Yes 12/01/08 4% $219,826 $0 84 $54,000 4/2/08 FTHB Yes 05/01/18 3% $54,000 $60,811
Richardson, Donald
Rivera, Olga
Roberts, Brigitte
Quist, Carolyn
Randle, Tracy
Randle, Tracy
Raymond, Timothy
Reyes, Fermin
Owens, Kathy
Pacheco, Jose
Pacheco, Jose
Padilla, Josephine
Plouche, Larac
Mercurio, Prudi
Migal, Irina
Molinar-Brown, Gail
Munoz, Bernabe
Nolasco, David
Magistrado, Eguzki
Magistrado, Eguzki
Manalo, Rhea Tapia
Manzano, Benedicto
Mendoza,
Kuo, Kun
Kuo, Andrew
Lakatos, Jenny Weil
Li, Man Yiu
Magistrado, Eguzki
Joya, Genoveva
Joyner, Sylvia
Kang, Hyeok Jae
Khan, Asif Ali
Knighton, Caroline
Hung, Jui
James, Bobbie
James, La Ruth
Jimenez, Pedro
Jirachavalwong,
Huang, Erxiong
Hudson, Michael
Hudson, Michael
Hue, Alisa
Huie, Amie
Haskins, Pamela
Hickok, Kenneth
Hickok, Kenneth
Ho, Yun Sang
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
435
85 $50,000 8/17/07 FTHB Yes 10/01/17 3% $50,000 $0
86 $33,500 6/15/05 FTHB Yes 08/01/15 3% $33,500 $0
87 $25,000 6/9/08 R&B Yes 08/01/18 3% $25,000 $0
88 $33,750 11/17/09 FTHB Yes 01/01/20 3% $33,750 $37,740 89 $23,109 8/27/07 R&B Yes 10/01/17 3% $23,109 $0
90 $45,750 8/30/07 FTHB Yes 10/01/17 3% $45,750 $50,433 91 $30,000 11/17/08 FTHB Yes 12/01/18 3% $30,000 $0
92 $50,000 11/27/06 FTHB Yes 01/01/17 3% $50,000 $59,105 93 $35,000 3/16/05 FTHB Yes 05/01/15 3% $35,000 $0
94 $35,000 5/23/05 Citywide Yes 07/01/15 0% $0 $35,000
95 $35,000 5/23/05 FTHB Yes 07/01/15 3% $35,500 $43,538 96 $297,589 10/3/07 Loss Mit Yes 12/01/07 4% $297,589 $384,873 97 $64,000 11/3/08 FTHB Yes 01/01/19 3% $64,000 $71,076 98 $16,007 11/25/08 R&B Yes 01/01/19 3% $16,007 $0
99 $50,000 1/31/08 FTHB Yes 03/01/18 3% $50,000 $0
100 $251,576 10/15/09 Loss Mit Yes 01/01/10 5% $251,576 $196,948 101 $58,000 8/27/08 FTHB Yes 10/01/18 3% $58,000 $0
102 $34,990 9/23/08 Citywide Yes 12/01/18 3% $0 $34,990 103 $69,980 9/23/08 FTHB Yes 12/01/18 3% $69,980 $77,912 104 $75,000 8/6/08 FTHB Yes 10/01/18 3% $75,000 $0
105 $71,980 8/8/08 FTHB Yes 09/01/18 3% $71,980 $0
106 $73,000 4/26/09 FTHB Yes 06/01/19 3% $73,000 $0
107 $30,000 8/24/05 FTHB Yes 10/01/15 3% $30,000 $0
108 $35,000 7/21/05 CItywide Yes 09/01/15 0% $0 $0
109 $48,350 7/21/05 FTHB Yes 09/01/15 3% $48,350 $0
110 $50,000 6/12/07 FTHB Yes 08/01/17 3% $50,000 $0
111 $23,995 9/23/08 R&B Yes 11/01/18 3% $23,995 $0
112 $48,400 10/29/08 FTHB Yes 12/01/18 3% $48,400 $41,717 108 $35,000 2/22/06 CItywide Yes 02/22/26 0% $0 $35,000 ¹ Amounts includes accrued interest
Loan Faraon, Ditas
Sova, Yenny
Tanaka, Joyce
Tanaka, Joyce
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Loan
Skinner, La Toya
Sophus, Donna
Robertson, Landa
Robinson, Darren
Rogers, Nicholas
Romero, Renan
Rosin, Bodo
Roth, Tiffany
San Antonio, Maria
Sanchez-Hughes,
Saporita-Jacobs,
Shaheed, Janine
Shaheed, Janine
Shaheed, Janine
Shaw, Trina
Snider, Mariama
Tharoke, Kashyap
Whitlock, Byron
Loan Zhao, Jue
Loan Yee, Raymond
Loan
Loan
Loan
Loan
Thorn, Stacy
Van Hook, Denise
Welsh, Delmoreen
Loan
Loan Woods, Yvonne
Loan Whitlock, Byron
436
Exhibit E - Rents/Operations
Item #
Type of
property with
which they
payments are
associated
Property
owner
Entity that
collects the
payments
Entity to which
the collected
payments are
ultimately
remitted
Purpose for
which the
payments
are used
Is the
property
encumbered
by a low-mod
housing
covenant?
Source of lowmod housing
covenant
Item # from
Exhibit A the
rent/operation
is associated
with (if
applicable)
1 2
3 4
5 6
7 8
9 10
11 12
13 14
15 16
17 18
19 20
City of Hercules Redevelopment Agency
Inventory of Assets Received Pursuant to Health and Safety Code section 34176 (a) (2) Type of payment
437
Exhibit F - Rents
Item #
Type of
property with
which the
payments are
associated b/
Property
owner
Entity that
collects the
payments
Entity to which
the collected
payments are
ultimately
remitted
Purpose for
which the
payments
are used
Is the
property
encumbered
by a low-mod
housing
covenant?
Source of low-mod
housing covenant
c/
Item # from
Exhibit A the
rent is
associated with
(if applicable)
1 2
3 4
5 6
7 8
9 10
11 12
13 14
15 16
17 18
19 20
City of Hercules Redevelopment Agency
Inventory of Assets Received Pursuant to Health and Safety Code section 34176 (a) (2) Type of payment a/
438
Exhibit G - Deferrals
Item #
Fiscal year in
which funds
were deferred
Amount
deferred
Interest
rate at
which
funds were
to be
repaid
Current
amount owed
Date upon which
funds were to be
repaid
1 2
3 4
5 6
7 8
9 10
11 12
13 14
15 16
17 18
19 20
City of Hercules Redevelopment Agency
Inventory of Assets Received Pursuant to Health and Safety Code section 34176 (a) (2) Purpose for which
funds were deferred
439
DISCUSSION AND/OR ACTION
AGENDA ITEM
5. 22-782
440
1 STAFF REPORT TO THE CITY COUNCIL
DATE: Regular Meeting of February 27, 2024
TO: Mayor and Members of the City Council
VIA: Dante Hall, City Manager
SUBMITTED BY: Edwin Gato, Director of Finance
SUBJECT: FY 23-24 Midyear Budget Review and Recommended Midyear Budget Appropriations and Adjustments
RECOMMENDED ACTION:
Receive a report on the FY 23-24 midyear budget review and adopt a resolution approving midyear budget appropriations and adjustments as summarized and detailed in Attachment
2. EXECUTIVE SUMMARY:
The Midyear Budget review allows the City to adjust the current fiscal year budget (FY 23- 24) for changes in projected revenues and expenditures levels that may have occurred since the adoption of the Annual Budget on June 13, 2023. The changes are contained in this report.
BACKGROUND:
This report updates the Fiscal Year 23-24 financial projections and proposes the current year budget amendments for various City funds to reflect and respond to the City’s current financial condition. Also, this report provides the City Council with updates on the financial status of the City’s General Fund by comparing budget projections for revenues and expenditures to actual receipts and expenses as of December 31, 2023.
ANALYSIS:
As part of the budget process, the City staff must report to the City Council at midyear, examining revenues and expenditure and adjustments if necessary. The process provides an opportunity to review the status of the Budget at midyear to adjust the City’s planned operations and Budget.
22-782
441
2 The Midyear Budget Review begins with the good news that at the six-month mark (December 31, 2023), most of the General Fund revenues are at 50%. Expenditures are 49%, slightly lower than the original budget overall.
General Fund
In accordance with the City’s Financial Policies, the annual operating budget was conservative when adopted. This was particularly true as we faced the many uncertainties created by the past COVID-19 pandemic and the record inflation and international instabilities. The Policies also call for one-time, non-operating expenditures to be funded from one-time revenues. The City’s practice of budgeting conservatively and living within our means remains effective at ensuring that we maintain good fiscal health, and the recommended changes in this Midyear Budget Review remain true to these practices.
I. General Fund Revenues
As of December 31, 2023, the General Fund operating revenues were $9.1 million or 50% of the FY 23-24 adopted budget. Revenues from business licenses, franchise fees, and other taxes are received bi-annually and towards the end of the fiscal year. This accounts for why revenues are below 50% as of December 31, 2023, in some of these line items. Also, the revenues received from program fees fluctuate each year. However, these revenues are offset by expenditures incurred by fees.
II. General Fund Expenditures
A summary and year-to-date status of General Fund expenditures are presented in Attachment 2. Payments on the insurance premiums are due at the beginning of the fiscal year, which accounts for why expenditures on this line item are higher than 50% as of December 31, 2023.
Typically, the mid-year budget review and adjustments recommended are to make corrections to adopted budget and to address required modifications. New initiatives or programs are not often contemplated unless it’s necessary.
Due to prudent fiscal stewardship, the City’s financial position continues to remain strong and reaffirms its commitment to sound and conservative financial practices.
Based on an evaluation of the FY 23-24 adopted budget and actual expenditures through December 31st, staff is not recommending adjustments to the General Fund budget.
III. General Fund Operating Reserve
Fiscal stability is an essential factor for all cities. Sound financial management includes the practice and discipline of maintaining adequate reserve funds for known and unknown contingencies. The City’s operating reserve policy requirement equals 16.66% of total operating expenditures (or two months). The General Fund operating reserve exceeded that requirement and maintained an operating reserve equal to 25% of the total operating budget.
442
3 Non-General Fund Programs
These funds are driven by grants or other funding sources for specific purposes, such as transportation, Gas Tax, and Measure C “Street Fund”. Such funding sources are restricted, requiring revenues and expenditures to be tracked differently from the City’s primary operating fund, the General Fund. There is sufficient funding and appropriation to complete current projects or programs and fund the proposed mid-year adjustments as summarized and detailed in Attachment 2, except for Victoria by the Bay Lighting and Landscaping Assessment District (LLAD) and the Stormwater fund, which is projected to end the year with negative fund balances of over $546K and $211K, respectively. Staff are working on a strategy to address these deficits.
Next Step
Staff are preparing the FY 24-25 budget with a series of recommended budget workshops.
The table below outlines key Council meeting dates on which budget information will be provided.
Budget Award
The City of Hercules FY 22-23 Budget was awarded the Distinguished Budget Presentation Award from the Government Finance Officers Association (GFOA) for the fourth time. This award is the highest form of recognition in government budgeting. Its attainment represents a significant achievement by the organization. Staff submitted the FY 23-24 Budget documents for award consideration.
FISCAL IMPACT:
The proposed budget amendment to the FY 23-24 Budget is summarized and detailed in Attachment 2. There is no net impact to the General Fund for the proposed amendments.
Measure J SP grant will reimburse the budget amendment of $22,000 for the annual reporting/environmental compliance. Please see Attachment 2 for more details.
Date Action/Topic
February 27, 2024 FY 23-24 Midyear Review & Budget Amendments March 26, 2024 Budget Workshop to discuss the Five-Year CIP and project priorities.
April 9, 2024 Budget Workshop to discuss the Preliminary draft of the FY 24-25 Sewer Enterprise and Internal Service Funds budgets
April 23, 2024 Budget Workshop to discuss the Preliminary draft of the FY 24-25 General Fund Operating budget and other funds (Special Revenues, Debt Service, Agency and Successor Agency) budget
May 14, 2024 Introduction and First Public Hearing of the FY 24-25 Budget and Five-Year Capital Improvement Plan (CIP)
May 28, 2024 Second Public Hearing and Adoption of the FY 24-25 Budget and Five-Year Capital Improvement Plan (CIP)
443
4 ATTACHMENTS:
1. Budget Resolution
2. Proposed Budget Amendment
3. General Fund Summary
4. Non-General Fund Summary
444
RESOLUTION NO. 24-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES APPROVING FY 23-24 MIDYEAR BUDGET APPROPRIATIONS AND ADJUSTMENTS
WHEREAS, the City Council has adopted the FY 23-24 Budget on June 13, 2023, representing the financial plan for conducting the affairs of the City of Hercules; and WHEREAS, the following recommended appropriations and adjustments have been evaluated and reviewed by the City Manager and Finance Director. The detailed budget amendment proposal is presented in Attachment 2 in the accompanying staff report; and WHEREAS, staff is requesting approval for FY 23-24 budget appropriations and adjustments as set forth in Attachment 2.
NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Hercules as follows:
1. The City Council hereby approves FY 23-24 Budget appropriations and adjustments as set forth in Attachment 2.
The foregoing Resolution was duly and regularly adopted at a regular meeting of the City Council of the City of Hercules held on the 27th day of February 2024, by the following vote of the Council:
AYES:
NOES:
ABSENT:
ABSTAIN:
____________________________
Dan Romero, Mayor
ATTEST:
Eibleis Melendez, City Clerk
445
City of Hercules
FY 23-24 Mid-Year Budget Review
Proposed Budget Amendments
Revenues/ Expenditures/ Add(Draw) on
Transfers In Transfers Out Fund Balance Account No. Project No.
NON-GENERAL FUND PROGRAMS
Measure J SP Grant
Annual Reporting/Environmental Compliance for the HUB 22,000 22,000 354-5970-641.08-00 63056 - Total, Other Funds 22,000 22,000 -
446
General Fund
Fund Summary - 100
Fund Description / Budget Highlights
Fund Activity
FY 21-22 FY 22-23 FY 23-24
Actual Actual Budget
6 Months
Actual %
Beginning Available Balance 2,138,829 977,254 $ 1,808,562 $ 1,808,562 0% Revenues
Taxes
Utility User Tax 3,828,410 3,996,274 3,756,633 1,916,393 51% Sales Tax 6,263,066 6,192,500 6,178,700 3,208,828 52%
Property Taxes 1,524,791 1,638,581 1,603,000 841,216 52% Franchise Fees 970,054 988,108 923,100 343,826 37%
Business Licenses 257,289 274,540 279,480 65,405 23%
Transfer Tax 199,673 120,539 148,920 26,717 18%
Transient Occupancy Tax 25,778 30,518 116,280 8,542 7%
Vehicle License Fee (VLF) and Other
Intergovernmental 2,391,327 2,527,866 2,561,220 1,287,808 50% Fines & Forefeitures 48,663 46,057 38,760 7,231 19%
Program Revenues -
Community Development 329,134 349,874 173,075 65,079 38% Parks and Recreation 1,034,173 1,423,642 1,300,640 598,576 46% Police 136,878 196,189 116,700 24,245 21%
Public Works 10,464 30,776 38,760 17,075 44%
Other 6,723 12,231 11,220 2,649 24%
Use of Money & Property 347,905 794,570 292,320 226,819 78% Cost allocated to other funds 624,568 588,529 736,352 370,169 50% Transfers In 396,816 150,000 156,727 156,727 100%
18,395,712 19,360,794 18,431,887 9,167,305 50%
Expenditures
Police 7,759,504 8,430,069 8,367,070 4,207,961 50%
Public Works 313,571 417,265 454,663 217,987 48%
Community Development 724,190 511,989 933,497 300,560 32% Parks and Recreation 1,952,419 2,408,847 2,494,876 1,184,024 47% City Council 330,296 329,843 335,677 133,769 40%
City Manager 496,216 491,141 496,565 226,415 46%
Human Resources 308,009 258,427 385,440 184,753 48%
Legal 209,134 193,487 281,190 82,690 29%
City Clerk 377,112 408,679 514,940 136,032 26%
The General Fund is the City of Hercules Chief Operating Fund. This fund is used to account for all revenues and expenditures necessary to carry out basic governmental activities of the City that are not accounted for through other funds. For the City, the General Fund includes such activities as police, planning, engineering, public works, operations and maintenance, and legal and administrative services.
447
General Fund
Fund Summary - 100
Fund Description / Budget Highlights
Fund Activity
FY 21-22 FY 22-23 FY 23-24
Actual Actual Budget
6 Months
Actual %
The General Fund is the City of Hercules Chief Operating Fund. This fund is used to account for all revenues and expenditures necessary to carry out basic governmental activities of the City that are not accounted for through other funds. For the City, the General Fund includes such activities as police, planning, engineering, public works, operations and maintenance, and legal and administrative services.
Finance 1,114,284 1,281,043 1,309,702 643,510 49%
Workers Comp/General Liability 1,135,659 1,241,404 1,467,349 1,216,969 83% Non-Department 260,000 260,000 260,000 100,000 38%
Transfers Out (Debt Service Obligations) 423,542 822,559 799,212 235,897 30% 15,403,936 17,054,753 18,100,181 8,870,567 49%
Net Annual Activity
Ongoing Operations 2,991,776 2,306,041 $ 331,706 $ 296,738 One-Time Revenues 1,431,000 169,461 - - 0%
One-Time Expenditures (2,652,580) (1,644,194) (229,250) (212,379) 93% Reserve per Council Policy (2,931,771) (196,887) (196,887) 100% Ending Available Balance $ 977,254 $ 1,808,562 $ 1,714,131 $ 1,696,034 Operating Reserve:
Beginning Balance 4,034,517 4,209,129 $ 4,222,158 $ 4,222,158 Current Year Contribution 196,887 196,887 100%
Interest Earned 174,612 13,029 106,000 103,982 98%
Ending Balance 4,209,129 4,222,158 $ 4,525,045 $ 4,523,027 % of Projected Operating Expenditures 27% 25% 25%
448
FY 23-24 MIDYEAR BUDGET REVIEW
NON-GENERAL FUND SUMMARY
Special Revenue Funds
Beginning
Available Balance Revenue Expenditures Midyear Request Net Activities Ending Available
Balance
Fund No. Fund Name Actual Budget 6-Month Actual % Budget 6-Month Actual % Adjustments As Projected As Projected 101 ASSET SEIZURE 206,646 - 1,133 - 22,286 - 206,646
201 AB 3229 COPS Program 33,283 150,000 90% 134,625 156,727 0% - (6,727) 26,556 220 CITYWIDE L&L DIST 83-2 69,986 1,298,183 52% 677,371 1,336,022 581,364 44% (37,839) 32,147 221 VICTORIA BY THE BAY L&L (437,028) 520,580 54% 279,696 629,910 410,901 65% (109,330) (546,358) 222 HERCULES VILLAGE L&L DIST 142,809 178,982 54% 96,013 228,160 101,854 45% (49,178) 93,631 223 BAYWOOD ASSESS 04-1 L&L 74,042 173,230 53% 91,435 173,175 40% 69,891 55 74,097 224 BAYSIDE ASSESS DIST L&L 125,899 160,665 54% 87,501 150,085 43% 65,057 10,580 136,479 225 ARTERIAL ROADWAYS 461,595 322,637 0% - 327,980 193,201 59% (5,343) 456,252 231 STORMWATER ASSESSMENT (157,621) 381,000 2% 9,014 434,833 164,876 38% (53,833) (211,454) 241 DIF-GEN PUBLIC FACILITIES 146,401 34,950 16% 5,670 - - 34,950 181,351 242 COMMUNITY DEVELOPMENT FND 170,869 60,000 0% - - - 60,000 230,869 243 DEVELOPMENT FEE FUND 72,575 - - - - - 72,575
244 DIF-POLICE FACILITIES 264,712 - 2,530 - 830 - 264,712 246 DIF-FIRE FACILITIES 1,709 - - - - - 1,709
247 DIF-PARK & REC 149,238 - - - 39,766 - 149,238
249 PUBLIC BENEFIT FEE 984,503 - - - - - 984,503
261 DIF-TRAFFIC FACILITIES 126,128 - 68,127 - - - 126,128 262 STATE GAS TAX FUND 248,859 1,392,993 20% 274,225 1,257,526 215,617 17% 135,467 384,326 263 MEASURE "C" STREET FUND 136,571 450,000 117% 526,533 529,965 177,505 33% (79,965) 56,606 264 STMP TRAFFIC IMPACT FUND - - - - - - -
267 GENERAL PLAN UPDATE 949,323 240,000 18% 42,820 - - 240,000 1,189,323 291 SOLID WASTE AND RECYCLING 770,818 180,000 25% 44,125 237,562 15,824 7% (57,562) 713,256 521 REGIONAL WATER QUALITY 52,188 - - - - - 52,188
266 BART (PARK & RIDE) 320,448 182,000 17% 31,323 182,000 121,541 67% - 320,448 268 SB1 (RMRA) 425,712 - 320,426 - 106,649 - 425,712
5,339,665 5,725,220 2,692,568 47% 5,643,945 2,287,162 41% - 81,275 5,420,941 Enterprise Funds
Beginning
Available Balance Revenue Expenditures Midyear Request Net Activities Ending Available
Balance
Fund NumberFund Name Actual Budget 6-Month Actual % Budget 6-Month Actual % Adjustments As Projected As Projected 420 WASTEWATER - OPERATION 11,547,000 6,068,734 3,124,129 51% 7,009,825 3,224,520 46% (941,091) 10,605,909 421 WASTEWATER - CAPITAL - 132,000 0% - 132,000 0% - -
11,547,000 6,200,734 3,124,129 50% 7,141,825 3,224,520 45% - (941,091) 10,605,909 Special Revenue Funds account for the proceeds of specific revenue sources (other than trusts for individuals, private organizations, or other governments, or for major capital projects) that are restricted or committed to expenditures for specified purposes.
This fund accounts for wastewater treatment to the cities of Hercules and Pinole and for the maintenance of the City's sewer lines and related facilities. It is a self-supporting activity which provides services on a user charge basis to residences and businesses.
449
FY 23-24 MIDYEAR BUDGET REVIEW
NON-GENERAL FUND SUMMARY
Internal Service Funds
Beginning
Available Balance Revenue Expenditures Midyear Request Net Activities Ending Available
Balance
Fund NumberFund Name Actual Budget 6-Month Actual % Budget 6-Month Actual % Adjustments As Projected As Projected 450 VEHICLE REPLACEMENT FUND 315,624 153,000 0% - 220,000 19% 41,970 (67,000) 248,624 460 IT OPERATING FUND 967,462 996,333 0% 2,644 1,339,974 616,030 46% (343,641) 623,821 470 FACILITY MAINTENANCE FUND 727,879 938,955 0% - 995,631 393,768 40% (56,676) 671,203 2,010,965 2,088,288 0% 2,644 2,555,605 1,051,768 41% - (467,317) 1,543,647 Debt Service Funds
Beginning
Available Balance Revenue Expenditures Midyear Request Net Activities Ending Available
Balance
Fund NumberFund Name Actual Budget 6-Month Actual % Budget 6-Month Actual % Adjustments As Projected As Projected 672 2003B DEBT SERVICE PFA 4,567 563,316 0% - 564,937 510,827 90% (1,621) 2,946 673 2009 DEBT SERVICE PFA 2,063,873 907,159 28% 251,832 907,159 587,589 65% - 2,063,873 388 EQUIPMENT LEASE - 235,896 100% 235,897 235,896 100% 235,897 - - 2,068,440 1,706,371 29% 487,729 1,707,992 1,334,313 78% - (1,621) 2,066,819 Capital Projects Funds
Beginning
Available Balance Revenue Expenditures Midyear Request Net Activities Ending Available
Balance
Fund NumberFund Name Actual
Budget, As
Amended 6-Month Actual % Budget 6-Month Actual % Adjustments As Projected As Projected 295 FEDERAL GRANTS - - 0% - - 0% - - -
296 STATE GRANTS - 502,506 0% - 502,506 0% - -
300 CITY CAPITAL PROJ-SINGLE 341,862 450,000 225,000 0% 450,000 398,676 89% - 341,862 301 ENERGY CONSERVATION PROJECT 116,238 - 0% - - 0% - - 116,238 354 HERCULES HUB - 322,000 0% - 300,000 25% 76,339 22,000 - - 387 WATER QUALITY RET BASIN 231,025 50,000 64% 31,989 47,000 42% 19,621 3,000 234,025 689,125 1,324,506 19% 256,989 1,299,506 494,636 38% 22,000 3,000 692,125 These funds account for activities related to vehicle replacement, IT equipment replacement, and facilities maintenance.
These funds are used to account for money that will be used to pay the interest and principal of long-term debts. Bonds used by a government to finance major construction projects, to be paid by tax levies over a period of years, require a deby service fund to account for their repayment. The debts of special assessment and proprietary funds are serviced within those funds, rather than by a separate debt service fund.
These funds are used to account for the construction or acquisition of fixed assets, such as buildings, equipment and roads. Depending on its use, a fixed asset may instead be financed by a special revenue fund or a proprietary fund. A capital project fund exists only until completion of the project. 450
DISCUSSION AND/OR ACTION
AGENDA ITEM
6. 22-787
451
REPORT TO THE CITY COUNCIL
DATE: Regular Meeting of February 27, 2024
TO: Mayor Romero and Members of the City Council
SUBMITTED BY: J. Patrick Tang, City Attorney
SUBJECT: Proposed Resolution to Amend City Manager Hall’s Employment Agreement to Increase the Annual Salary from $262,086 to $285,000 and to Provide Education Incentive Pay of 3%
RECOMMENDED ACTION:
Discuss and consider adoption of a resolution to amend City Manager Dante Hall’s Employment Agreement to increase the current annual salary from $262,086 to $285,000 and to Provide Education Incentive Pay of 3%.
BACKGROUND:
On July 27, 2021, the City Council approved a five-year Agreement for City Manager/Executive Director Services (hereinafter “Original Agreement”) to employ Dante Hall as the City Manager of the City of Hercules. The Original Agreement provides for, among other matters, an annual performance review, an annual cost of living adjustment (“COLA”) of 3%, and benefits on the same terms and conditions as other Senior Management Employees. See Attachment 1.
On October 25, 2022, the City Council approved a resolution to amend the Original Agreement to increase the City Manager’s COLA to 4.5% for fiscal years 2022-23 and 2023-24, to make it consistent with the COLA previously approved by the Council for the Senior Management Group. See Attachment 2.
On February 13, 2024, the City Council in closed session appointed an ad hoc subcommittee (“Subcommittee”) composed of members Dan Romero (Mayor) and Dion Bailey (Vice Mayor), tasked with reviewing city manager salaries in other jurisdictions and making recommendations to the full City Council regarding a potential salary increase for the City Manager position in order to provide a Retention Incentive for City Manager Dante Hall, who is now in his third year serving as the Hercules City Manager.
22-787
452
DISCUSSION:
Every year since becoming City Manager, Dante Hall has received positive annual evaluations, and his work is highly valued by the City Council and the community.
The Council has determined that it is in the City‘s best interest to retain the current city administrator, thus providing continuity and stability at a time when Hercules needs strong administrative leadership to manage a wide range of Council and community demands and expectations.
The demand for qualified and experienced City Managers is particularly competitive. The City Council recognizes that to retain top talent, the City of Hercules must remain competitive with other cities looking to hire qualified city managers.
After having reviewed relevant City Manager salary and benefits information from various other cities including Orinda, Oakley, Pleasant Hill, Martinez, Albany, El Cerrito, San Pablo, Pinole, Lafayette, and Suisun, the Council Ad Hoc Subcommittee composed of Mayor Romero and Vice Mayor Bailey are recommending that the full Council approve a Resolution to Amend City Manager Hall’s employment agreement to increase his annual salary from the current amount of $262,086 to a proposed amount of $285,000. In addition, the subcommittee is recommending that an additional 3% be awarded for relevant post-graduate degrees obtained (Education Incentive Pay). The changes to the original 2021 Employment Agreement as amended in 2022 are shown in Redline in Attachment 3.
ACTION:
Discuss and consider adoption of a Resolution Increasing the City Manager’s Compensation and providing for an additional 3% Education Incentive Pay.
ATTACHMENTS:
1. 2021 Agreement with Dante Hall for City Manager/Executive Director Services.
2. 2022 Amendment 1 to Original Agreement.
3. Proposed changes to 2021 Agreement as amended.
4. Resolution to Increase City Manager Salary and providing for Education Incentive Pay.
453
Agreement No. 21-028
City Council Resolution No. 21-054
CITY OF HERCULES
AGREEMENT WITH DANTE HALL FOR
CITY MANAGER/EXECUTIVE DIRECTOR SERVICES
This Agreement is made and entered into at Hercules, California this 27 day of July, 2021, by and between the City of Hercules, a California municipal corporation, and the City of Hercules as Successor Agency to the Redevelopment Agency (hereinafter “City”), and Dante Hall (“Hall”), an individual.
RECITALS
WHEREAS, the City requires the services of a person with proven executive and administrative qualifications to fill the position of City Manager; and WHEREAS, the City, acting by and through its City Council, desires to employ the services of Dante Hall as City Manager, and to appropriately compensate him for such services; and WHEREAS, the Parties acknowledge that the City Manager must be committed to the ideals of the International City Management Association (“ICMA”), and that the City Manager shall be subject to and shall comply with the ICMA Code of Ethics, incorporated herein by reference; and WHEREAS, Dante Hall desires to accept employment as City Manager of the City of Hercules under the terms and conditions of employment as set forth herein.
NOW, THEREFORE, in consideration of this Agreement, and the mutual promises, terms and conditions contained herein, the parties agree as follows:
1. Appointment. The City agrees to employ and appoint Hall to the position of City Manager, and Hall agrees to accept employment as City Manager, subject to successful completion of all required background checks and a pre-employment physical. Hall will commence providing services to the City of Hercules on August 16, 2021, or upon successful completion of all required background and health checks, whichever occurs later. Upon Hall’s commencement of services, City shall confer upon and delegate to Hall all of the duties, powers, and responsibilities of City Manager as the same are set forth in the City of Hercules Municipal Code, and the ordinances, resolutions, policies, rules and regulations existing thereunder (“the Services”).
2. Term. This Agreement shall be for a five year term (“Initial Term”), unless services are otherwise terminated pursuant to Sections 4, 5 or 6 of this Agreement. Upon expiration of the five year DocuSign Envelope ID: 9EB42926-EA8E-4418-9254-1EAB8226F4E5 454
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City Council Resolution No. 21-054
Initial Term, Hall shall continue as City Manager on a year-to-year basis, with the year-to-year service subject to the same terms and conditions specified in this Agreement, including the termination provisions in Sections 4, 5 and 6, and subject to the Incentive provisions in Section 6(D).
3. Duties.
A. Hall covenants that he presently has no interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the performance of his services pursuant to this Agreement. Hall further covenants that he shall be subject to and abide by the applicable provisions of the Political Reform Act, and all City ordinances, regulations, and policies related to conflict of interest, including but not limited to Ordinance No. 486 (Hercules Municipal Code Title 2, Chapter 3, Article 4, Sec. 2-3.401 et seq.), prohibiting nepotism and cronyism in contracting and employment, a copy of which has been provided to Hall.
B. As full time City Manager of the City, Hall accepts employment subject to the terms and conditions of this Agreement and agrees (1) to perform the duties and functions identified in Hercules Municipal Code Title 2, Chapter 3, Article 1, and other duties and functions as the Council assign either orally or in writing and (2) to devote all of his productive time, attention and energies to performing all such duties and functions in a professional and ethical manner to the best of his skill and ability and (3) to use his best efforts to promote and advance the interests of the City. Hall further agrees that he has no authority to bind the City or any of its elected or appointed officials or commit the City to any course of action without the duly authorized written consent of the City. Hall acknowledges that the position of City Manager is a position of high visibility before the public and agrees that he shall conduct himself before the public and City staff, both during and outside of regular working hours, in a manner that reflects favorably on the City. Hall agrees to use his best efforts to pursue and realize Council goals and objectives.
C. Full Time. Hall understands and agrees that the position of City Manager is not a part time position and will require Hall to work greater than a customary forty hour week. Although City Hall is generally open to the public during regular set work hours, Hall shall perform his obligations as full time City Manager during regular work hours and on such evenings, weekends and other times as are necessary.
D. Vacation Notice. Vacation and other leave susceptible to advance scheduling shall be scheduled with the City Council in advance.
E. No Other Employment. Hall agrees not to undertake any other employment during the term of this Agreement. Hall further agrees to obtain Council approval before undertaking any non-paid projects for organizations or other non-City work which may require a substantial time commitment by Hall.
DocuSign Envelope ID: 9EB42926-EA8E-4418-9254-1EAB8226F4E5 455
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City Council Resolution No. 21-054
Hall agrees not to engage in any activity, consulting service, or enterprise, for compensation or otherwise, which is actually or potentially in conflict with or inimical to, or which materially interferes with, his duties and responsibilities to the City.
4. Termination by Hall. Hall may terminate this Agreement and resign as City Manager at any time, for any reason, upon sixty (60) days prior written notice to the City. Upon receipt of written notice from Hall, the City may elect to immediately remove Hall from his position as City Manager or to allow Hall to remain as City Manager for all or any part of the sixty day notice period. If the City removes Hall from his position as City Manager prior to the expiration of the sixty day notice period, the City will pay Hall an amount equal to the salary and benefits that Hall would have received if he had remained in the City Manager position until the expiration of the sixty day notice period, less legally required withholdings. If the City advises Hall that he should continue to perform his duties and functions as City Manager during the sixty day notice period, and Hall fails to do so, Hall will receive no salary or benefits after the last date on which he actually performs his City Manager duties and functions.
5. Termination by City.
A. Termination With Cause. The City Manager may be discharged with cause. Cause includes, without limitation, and as determined in the reasonable discretion of the City, shall mean any of the following: (1) insubordination, (2) dishonesty, (3) embezzlement, (4) violation of Federal, State, local, or common law requirements pertaining to conflict of interest, (5) conviction of a criminal act, (6) involvement in any act involving moral turpitude that would compromise Halls’ effective performance as City Manager, (7) taking a position adverse to the interests of the City without the City’s prior written consent, (8) violation of any fiduciary duty owed to the City, (9) failure to abide by the employment restrictions under Sec. 3(C) of this Agreement, (10) failure to observe or perform any of his duties and obligations under this Agreement, if that failure continues for a period of thirty (30) days after Hall receives written notice from the City Council specifying the acts or omissions deemed to constitute that failure.
If the City elects to terminate this Agreement with cause, it will pay Hall for all earned pay and accrued, unused vacation benefits at the time it notifies Hall of the termination decision, less legally required withholdings. Hall will be entitled to no pay or benefits after the date that the City notifies him that this Agreement and his employment by the City are being terminated with cause. If the City elects to terminate this Agreement with cause, it will provide Hall with a written explanation for that decision sent to Hall’s last known home address. Hall shall have the right to meet with the City Council in closed session for the purpose of discussing the basis for his proposed termination with cause prior to a final vote on his termination with cause. In order to exercise that right, he must provide a written request to meet in closed session to the Mayor of the City and the City Attorney within fifteen days of the effective date of his termination with cause. Failure to timely provide such written notice shall constitute a waiver of the right to be heard.
DocuSign Envelope ID: 9EB42926-EA8E-4418-9254-1EAB8226F4E5 456
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City Council Resolution No. 21-054
If Hall is convicted of a crime involving an abuse of his office or position, all of the following shall apply:
1. If Hall is provided with administrative leave pay pending an investigation, Hall shall be required to fully reimburse City such amounts paid;
2. If City pays for the criminal legal defense of Hall (which would be in its sole discretion, as it is generally not obligated to pay for a criminal defense), Hall shall be required to fully reimburse City such amounts paid; and
3. If this Agreement is terminated, any severance pay and severance benefits related to the termination that Hall may receive from City shall be fully reimbursed to City or shall be void if not yet paid to Hall. For purposes of this Section, abuse of office or position means either: a) an abuse of public authority, including waste, fraud, and violation of the law under color of authority; or b) a crime against public justice.
B. Termination Without Cause. Notice of Termination Without Cause shall be provided in writing sent to Hall’s last known home address. If Hall’s employment is terminated without cause, City shall not be required to provide any reasons for that decision to Hall or anyone else.
If the City elects to terminate this Agreement and Hall’s employment without cause within the first two years of this Agreement, then as of the effective date of termination the term of this Agreement shall be deemed to have a remaining duration of nine months. If the City elects to terminate this Agreement and Hall’s employment without cause during the last year of this Agreement or during the year-to-year extension beyond the last year of this Agreement, then as of the effective date of termination the term of this Agreement shall be deemed to have a remaining duration of the lesser of six months or until the end of the remaining year. The City will pay Hall for all earned pay and accrued, unused vacation benefits up to but not including the effective date of termination, less legally required withholdings. Additionally, the City will, within thirty (30) days of the effective date of termination, pay Hall for the remaining duration specified in this Section 5B of this Agreement the amount of salary and benefits he is earning on the date he is given notice that this Agreement and his employment are being terminated, less legally required withholdings.
C. Inability To Perform Essential Duties and Functions. Hall agrees that if he is unable to perform the essential duties and functions of the City Manager position for any reason for more than thirty (30) consecutive calendar days, the City may terminate this Agreement. If the City elects to terminate this Agreement based on Hall’s inability to perform the essential duties and functions of the City Manager position, it will so advise Hall in writing sent to Hall’s last known home address. At the time the City provides such notice, it will pay Hall for all earned pay and accrued, unused vacation benefits, less legally required deductions.
If termination of this Agreement is the result of the death of Hall, this Agreement shall be considered terminated effective upon his death, and City shall pay all salary and benefits then DocuSign Envelope ID: 9EB42926-EA8E-4418-9254-1EAB8226F4E5 457
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City Council Resolution No. 21-054
due to Hall at the time of death to his legal heir(s).
D. Statement Upon Termination. In the event City terminates Hall for any reason or no reason, the City and Hall agree that no member of the City Council, the City Management staff, or Hall, shall make any written, oral or electronic statement to any member of the public, the press, or any city employee concerning Hall’s termination except in the form of a joint press release or statement, the content of which is mutually agreeable to the City and Hall. The joint press release or statement shall not contain any text or information that is disparaging to either party. Either party may verbally repeat the substance of the joint press release or statement in response to any inquiry.
6. Compensation.
A. Salary.
The City agrees to pay Hall for the performance of his duties and functions an annual salary of $240,000, less legally required deductions, subject to an annual cost of living adjustment of 3% per year.
Salary will be paid in installments at the same time that other employees of the City are paid.
Any adjustment to Hall’s salary besides the annual 3% cost of living adjustment must be pursuant to a resolution of the Council. Hall shall not be entitled to receive payment or credit for, and City shall not pay or credit Hall for, overtime, compensated time off in lieu of overtime, or other compensation except as expressly provided in this Agreement. Hall acknowledges that the position of City Manager is exempt from the provisions of the Fair Labor Standards Act (FLSA).
B. Benefits.
During the Term of this Agreement and his employment hereunder, Hall shall be entitled to receive benefits on the same terms and conditions as other senior management employees of the City, as provided for in the Senior Management Employment Agreement. In addition, Hall shall receive, including:
1. Vacation accrual at the 20 year rate level, and a one- time bank of ten (10) vacation days upon commencement of employment.
2. A one-time bank of five (5) additional sick days upon commencement of employment.
Some benefits may change during the course of Hall’s employment. Employees are noticed regarding any changes in benefits. Except as expressly set forth in this Agreement, Hall shall be entitled to the same benefits as those provided to senior management employees generally, but DocuSign Envelope ID: 9EB42926-EA8E-4418-9254-1EAB8226F4E5 458
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City Council Resolution No. 21-054
shall not be entitled to or be paid for any other benefits available to certain non-senior management employees of the City; for example, uniform allowances for police officers and public works employees.
C. One Time Moving Allowance.
Hall shall be provided a one time moving allowance to be applied to relocation expenses incurred within the five year Term of this Agreement. Hall shall provide the City with three estimates for the cost of relocation and moving expenses, and City shall reimburse Hall within thirty (30) days for such costs the amount equal to the lowest estimate provided by Hall, or $15,000, whichever is lowest.
D. Incentive.
As a retention incentive, if after the end of the five year Term of this Agreement, Hall continues as City Manager on a year-to-year basis for two full years, City agrees to pay Hall, in addition to an annual salary of $240,000 and 3% cost of living adjustment, a 5% bonus for each of years six and seven, less legally required withholdings, to be paid within thirty (30) days after the conclusion of his seventh year as City Manager. The bonus is not part of his annual salary and no portion of the bonus shall be awarded to Hall unless he has completed his seventh year as City Manager, except that Hall would receive a pro rata portion of the bonus if the City were to terminate Hall without cause at any time during years six or seven.
7. Performance Evaluations. The City shall review and evaluate Hall’s performance as City Manager in closed session as close as reasonably possible to the expiration of each twelfth month of this Agreement. The City shall conduct an additional mid-year review at the expiration of the first six months of the first year of this Agreement. Performance Reviews shall be discussed with Hall and reduced to writing. In addition to the evaluation schedule provided in this section, Council may schedule additional review and evaluation of Hall’s performance for closed session at any time.
To assist the Council in measuring the City Manager’s performance, within thirty (30) days of commencing his tenure as City Manager, Hall shall propose for Council approval a Performance Evaluation Plan that will form the basis for the initial Performance Review. Hall shall revise the Plan at the start of each successive year of service. The Plan shall specify actions to be taken until the next Performance Review, and shall contain specific and measurable criteria, with specified milestones.
8. Confidential Information. Hall agrees that he will not reveal attorney-client privileged, or any other confidential information about the City or City employees that he learns while performing the duties and functions of City Manager.
9. City Property. Hall agrees that all materials, regardless of their form, that he receives, creates or produces in connection with this Agreement and/or his employment as City Manager are and will remain the exclusive property of the City. Hall will immediately deliver all originals and all copies of such materials to the City that are in his possession or control upon termination of this Agreement or DocuSign Envelope ID: 9EB42926-EA8E-4418-9254-1EAB8226F4E5 459
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upon any request from the Mayor and/or the City.
10. Assistance in Litigation. Hall agrees that he will furnish information and proper assistance to the City as it may reasonably require with any litigation in which it is or may become involved, either during or after the termination of this Agreement. Hall further agrees that he will not discuss, reveal or convey any information or documents pertaining to the City to any person or entity, or to any attorney for or representative of any person or entity, with actual or potential claims adverse to the City except pursuant to duly issued legal process or as otherwise authorized by the City. Hall agrees to notify the City immediately upon receipt of any legal process pertaining to the City.
11. Governing Law. This Agreement will be construed and enforced in accordance with the laws of the State of California.
12. Headings. The headings used in this Agreement are provided for convenience only and may not be used to construe meaning or intent.
13. Assignment. Neither this Agreement nor any interest in this Agreement may be assigned by Hall without the prior express written approval of the City.
14. Severability. If any provision or portion of this Agreement is held to be invalid or unenforceable, this Agreement, including all of the remaining terms, will remain in full force and effect as if such invalid or unenforceable provision(s) or portion(s) had never been included.
15. Notices. Notices pursuant to this Agreement will be deposited with the United States Postal Service, postage prepaid and addressed as follows:
City:
City Clerk
City of Hercules
111 Civic Center Drive
Hercules, CA 94547
Hall:
Last Known Home Address
Official City Hall Address
16. Modification. This Agreement may only be modified by Resolution at a duly noticed meeting of the City Council. The City Council may fix other terms and conditions of employment, as it may determine from time to time, relating to the performance of the City Manager, provided such terms and conditions are not inconsistent with or in conflict with the provisions of this Agreement or applicable law.
17. Entire Agreement. This Agreement supersedes any and all other agreements, either oral or in writing, and contains all agreements between Hall and the City regarding his employment as City DocuSign Envelope ID: 9EB42926-EA8E-4418-9254-1EAB8226F4E5 460
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City Council Resolution No. 21-054
Manager. Hall and the City agree that no representations, inducements, promises or agreements, oral or otherwise, have been made to either party, or anyone acting on behalf of either party, which are not stated herein, and that no agreement, statement, or promise not contained in this Agreement will be valid or binding on either party.
18. Effective Date. This Agreement will become effective on the date of approval by the City Council at a duly noticed meeting of the Council.
19. Independent Review. Hall acknowledges that he has had the opportunity and has conducted an independent review of the financial and legal effects of this Agreement, and acknowledges that he has made an independent judgment regarding this Agreement and has not relied upon any representation of City, its officers, agents or employees, other than those expressly set forth in this Agreement.
20. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which, taken together, shall constitute one and the same Agreement.
City of Hercules
By: __________________________
Chris Kelley, Mayor
__________________________
Dante Hall
ATTEST:
_________________
Lori Martin
Administrative Services Director
Approved as to Form:
_____________________
J. Patrick Tang
City Attorney
DocuSign Envelope ID: 9EB42926-EA8E-4418-9254-1EAB8226F4E5 461
Agreement No. 21-028
City Council Resolution No. 22-092
Amendment No. 1 to Agreement with Dante Hall for City
Manager/Executive Director Services
This Amendment No. 1 to the Agreement with Dante Hall for City Manager/Executive Director Services is made and entered into by and between the City of Hercules, a California municipal corporation, and the City of Hercules as Successor Agency to the Redevelopment Agency (hereinafter “City”), and Dante Hall (“Hall”), City Manager/Executive Director.
Purpose. This Amendment No. 1 is being entered into to amend the existing Agreement with Dante Hall for City Manager/Executive Director Services that was approved by the City Council of the City of Hercules on July 27, 2021. Said Agreement with Dante Hall for City Manager/Executive Director Services shall hereinafter be referred to as the "Original Agreement" and is incorporated herein by reference.
Original Agreement Provisions. The parties hereto agree to continue to abide by those terms and conditions of the Original Agreement which are unaffected by this Amendment No. 1.
Amendment. This Amendment No. 1 is intended to amend Section 6 of the Original Agreement to provide as follows:
6. Compensation.
A. Salary. The City agrees to pay Hall for the performance of his duties and functions an annual salary of $240,000, less legally required deductions, subject to an annual cost of living adjustment of 3% per year. Salary will be paid in installments at the same time that other employees of the City are paid. Any adjustment to Hall’s salary besides the annual 3% cost of living adjustment must be pursuant to a resolution of the Council. Hall shall not be entitled to receive payment or credit for, and City shall not pay or credit Hall for, overtime, compensated time off in lieu of overtime, or other compensation except as expressly provided in this Agreement. Hall acknowledges that the position of City Manager is exempt from the provisions of the Fair Labor Standards Act (FLSA).
Pursuant to Resolution ______ of the City Council, the annual cost of living adjustment for Hall shall be 4.5% for fiscal years 2022-23 and 2023-24.
Adjustments shall be effective July 1, 2022 and July 1, 2023, respectively.
Amendment Approval: This Amendment No. 1 has been approved by the City Council by Resolution No. 22-092 , adopted by the City Council at the duly noticed regular Council meeting of October 25th, 2022, and is effective on the date of approval.
DocuSign Envelope ID: 6F32294E-21C8-4C0C-868A-F592370EC641 22-092
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Agreement No. 21-028
City Council Resolution No. 22-092
Counterparts. This Amendment No 1 may be executed in counterparts, each of which shall be deemed to be an original, but all of which, taken together, shall constitute one and the same document.
Signatures. These signatures attest the parties' agreement hereto:
On Behalf of the City Council City Manager
By: ________________ _______________
Dion Bailey, Mayor Dante Hall
ATTEST:
___________________________
Lauren Berges
City Clerk
APPROVED AS TO FORM:
___________________________
J. Patrick Tang
City Attorney
DocuSign Envelope ID: 6F32294E-21C8-4C0C-868A-F592370EC641
XXXXXXXXXXX
XXXXXXXXX
Acting City Clerk
Eibleis Melendez
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Amendment No. 2 to Agreement with Dante Hall for City
Manager/Executive Director Services
This Amendment No. 2 to the Agreement with Dante Hall for City Manager/Executive Director Services is made and entered into by and between the City of Hercules, a California municipal corporation, and the City of Hercules as Successor Agency to the Redevelopment Agency (hereinafter “City”), and Dante Hall (“Hall”), City Manager/Executive Director.
Purpose. This Amendment No. 2 is being entered into to amend the existing Agreement with Dante Hall for City Manager/Executive Director Services that was approved by the City Council of the City of Hercules on July 27, 2021, and subsequently revised by Amendment No. 1 on October 25, 2022. Said Agreement with Dante Hall for City Manager/Executive Director Services as revised by Amendment No. 1 shall hereinafter be referred to as the "Original Agreement" and is incorporated herein by reference.
Original Agreement Provisions. The parties hereto agree to continue to abide by those terms and conditions of the Original Agreement which are unaffected by this Amendment No. 2.
Amendment. This Amendment No. 2 is intended to amend Section 6 of the Original Agreement to provide as follows:
6. Compensation.
A. Salary. The City agrees to pay Hall for the performance of his duties and functions an annual salary of $240,000, less legally required deductions, subject to an annual cost of living adjustment of 3% per year. Salary will be paid in installments at the same time that other employees of the City are paid. Any adjustment to Hall’s salary besides the annual 3% cost of living adjustment must be pursuant to a resolution of the Council. Hall shall not be entitled to receive payment or credit for, and City shall not pay or credit Hall for, overtime, compensated time off in lieu of overtime, or other compensation except as expressly provided in this Agreement. Hall acknowledges that the position of City Manager is exempt from the provisions of the Fair Labor Standards Act (FLSA).
[Amendment No. 1 (approved July 27, 2021): Pursuant to Resolution of the City Council, the annual cost of living adjustment for Hall shall be 4.5% for fiscal years 2022-23 and 2023-24. Adjustments shall be effective July 1, 2022 and July 1, 2023, respectively.]
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Amendment No. 2 (approved February 27, 2024): Commencing with the pay period immediately following the adoption of Resolution 24- ____ of the City Council, the City agrees to pay Hall for the performance of his duties and functions an annual salary of $285,000, less legally required deductions, subject to an annual cost of living adjustment of 3% per year. Salary will be paid in installments at the same time that other employees of the City are paid. Any adjustment to Hall’s salary besides the annual 3% cost of living adjustment must be pursuant to a resolution of the Council. Hall shall not be entitled to receive payment or credit for, and City shall not pay or credit Hall for, overtime, compensated time off in lieu of overtime, or other compensation except as expressly provided in this Agreement. Hall acknowledges that the position of City Manager is exempt from the provisions of the Fair Labor Standards Act (FLSA).
B. Benefits.
During the Term of this Agreement and his employment hereunder, Hall shall be entitled to receive benefits on the same terms and conditions as the other senior management employees of the City, as provided for in the Senior Management Employment Agreement. In addition, Hall shall receive, including:
1. Vacation accrual at the 20 year rate level, and a one-time bank of ten (10) vacation days upon commencement of employment.
2. A one-time bank of five (5) additional sick days upon commencement of employment.
Some benefits may change during the course of Hall’s employment.
Employees are noticed regarding any changes in benefits. Except as expressly set forth in this Agreement, hall shall be entitled to the same benefits as those provided to senior management employees generally, but shall not be entitled to or be paid for any other benefit available to certain non-senior management employees of the City; for example, uniform allowances for police officers and public works employees.
C. One Time Moving Allowance
Hall shall be provided a one time moving allowance to be applied to relocation expenses incurred within the five year Term of this Agreement.
Hall shall provide the City with three estimates for the cost of relocation and moving expenses, and City shall reimburse Hall within thirty (30) days for such costs the amount equal to the lowest estimate provided by Hall, or $15,000, whichever is lowest.
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D. Incentive.
As a retention incentive, if after the end of the five year Term of this Agreement, Hall continues as City Manager on a year-to-year basis for two full years, City Agrees to pay Hall, in addition to an annual salary of $240,000 $285,000 and 3% cost of living adjustment, a 5% bonus for each of years six and seven, less legally required withholdings, to be paid within thirty (30) days after the conclusion of his seventh year as City Manager.
The bonus is not part of his annual salary and no portion of the bonus shall be awarded to Hall unless he has completed his seventh year as City Manager, except Hall would receive a pro rata portion of the bonus if the City were to terminate Hall without cause at any time during years six or seven.
E. Education Incentive Pay.
If Hall has obtained an advanced degree from an accredited university in a discipline directly related to public administration, public finance, or public management, Hall will be eligible for an additional 3% of his salary per year.
Amendment Approval: This Amendment No. 2 has been approved by the City Council by Resolution No. 24-___, adopted by the City Council at the duly noticed regular Council meeting of February 27, 2024, and is effective on the date of approval.
Counterparts. This Amendment No. 2 may be executed in counterparts, each of which shall be deemed to be an original, but all of which, taken together, shall constitute one and the same document.
Signatures. These signatures attest the parties' agreement hereto:
On Behalf of the City Council City Manager
By: ________________ _______________
Dan Romero, Mayor Dante Hall
ATTEST:
466
_________________
Eibleis Melendez
City Clerk
APPROVED AS TO FORM:
_________________
J. Patrick Tang
City Attorney
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RESOLUTION NO. 24-___
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES APPROVING A SECOND AMENDMENT TO CITY MANAGER DANTE HALL’S EMPLOYMENT AGREEMENT TO INCREASE HIS COMPENSATION TO $285,000 AND PROVIDING FOR ADDITIONAL 3% EDUCATION INCENTIVE PAY
WHEREAS, on July 27, 2021, the City Council approved a five-year Agreement with Dante Hall for City Manager/Executive Director Services (hereinafter “Agreement”) to employ Dante Hall as the City Manager of the City of Hercules; and WHEREAS, the Agreement provides for, among other matters, an annual performance review, an annual cost of living adjustment (“COLA”) of 3%, and benefits on the same terms and conditions as received by the Senior Management Employees; and WHEREAS, on October 25, 2022, the City Council approved Amendment No. 1 to the Agreement to increase the City Manager’s COLA to 4.5% for fiscal years 2022-23 and 2023-24, consistent with the COLA previously approved by the Council for the Senior Management Group; and
WHEREAS, on February 13, 2024, the City Council in a properly noticed closed session appointed an ad hoc subcommittee composed of members Dan Romero (Mayor) and Dion Bailey (Vice Mayor), tasked with reviewing city manager salaries in other jurisdictions and making recommendations to the full City Council regarding a potential salary increase for the City Manager position in order to provide an additional Retention Incentive for City Manager Dante Hall, who is now in his third year serving as the Hercules City Manager; and
WHEREAS, after having reviewed relevant City Manager salary and benefits information from various other cities including Orinda, Oakley, Pleasant Hill, Martinez, Albany, El Cerrito, San Pablo, Pinole, Lafayette, and Suisun, the Council Ad Hoc Subcommittee composed of Mayor Romero and Vice Mayor Bailey recommend that the full Council approve a Resolution to Amend City Manager Hall’s employment agreement to increase his annual salary from the current amount of $262,086 to a proposed amount of $285,000 and provide an additional 3% be awarded for relevant post-graduate degrees obtained (Education Incentive Pay).
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Hercules that Amendment No. 2 to the Agreement with Dante Hall for City Manager/Executive Director Services is hereby approved, to provide for an increase in the City Manager’s salary to $285,000.00 with an additional 3% awarded for relevant post-graduate degrees obtained (Education Incentive Pay).
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BE IT FURTHER RESOLVED that the Mayor be and is hereby authorized to execute the Second Amendment to City Manager Employment Contract for and on behalf of the City of Hercules, pursuant to the Council’s Rules of Procedure Section 4.8.6.
BE IT FURTHER RESOLVED that the Amendment No. 2 to the Agreement with Dante Hall for City Manager/Executive Director Services, shall be on file in the City Clerk’s Office.
The foregoing Resolution was duly and regularly adopted at the regular meeting of the City Council of the City of Hercules held on the 27th day of February 2024, by the following vote of the Council:
AYES:
NOES:
ABSTAIN:
ABSENT:
___________________
Dan Romero, Mayor
___________________________________
Eibleis Melendez, City Clerk
469
DISCUSSION AND/OR ACTION
AGENDA ITEM
7. 22-784
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1 STAFF REPORT TO THE CITY COUNCIL
Date: Regular Meeting of February 27, 2024
TO: Mayor and Members of the City Council
VIA: Dante Hall, City Manager
SUBMITTED BY: Christopher Roke, Parks and Recreation Director SUBJECT: Request for Information Regarding a Welcome Baby Event RECOMMENDED ACTION:
Staff recommends that the City Council receive information regarding a Welcome Baby event and provide direction, if any.
BACKGROUND:
On January 9, 2024, Councilmember Alex Walker Griffin requested staff to research the possibility of hosting an event called Welcome Baby and report back. The example of a Welcome Baby provided was based on an event held in the City of Montebello, California.
The concept is similar to the Senior Health Fair held at the Senior Center last spring where groups/agencies were invited to provide opportunities, services, programs, and more to seniors.
Further staff research revealed that Welcome Baby Programs are generally offered as ongoing services typically run by hospitals or medical facilities. There are a few programs that are run through groups like First 5 or Planned Parenthood, but all Welcome Baby programs are designed to connect a member of a hospital or medical facility directly to new mothers (and/or parents) after a baby arrives. The Welcome Baby event in the City of Montebello was organized and led by the Adventist Health White Memorial Hospital as part of their larger program to promote healthy pregnancies and early infant care to expecting mothers and families. The City of Montebello’s involvement in the actual event was limited to staffing a City booth promoting City services and amenities. 22-784
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2 ANALYSIS:
At the request of the City Council, staff researched Welcome Baby Events and Programs in other jurisdictions to see if a similar event would be feasible in Hercules. As mentioned in the background section above, we found that these programs are offered by medical centers and staffed by healthcare professionals such as nurses who provide instruction in breastfeeding and social workers who assist in enrolling program participants in health insurance plans such as Covered California. Other programs like First 5, and other County run programs strive to ensure that newborns and their families receive the much-needed assistance in low-income situations.
Since the City does not have the expertise or dedicated resources for this type of program, staff would need to research further to try to identify potential partners to bring a Welcome Baby event, similar to the one held in the City of Montebello, to the City of Hercules.
Should this be the direction given by the Council, staff could look for appropriate partners to bring this event to the City (i.e. Contra Costa Regional Medical Center, Kaiser, or John Muir).
Some of the groups that may be willing to be a part of an event like this may include Richmond City Rides, Urban Tilth, Black Infant Health, Early Childhood Medical Health, BACR (Bay Area Community Resources), First 5, and Aspiranet.
FISCAL IMPACT:
There is no fiscal impact associated with providing this informational report. Should the City Council choose to move forward with hosting a Welcome Baby Event, additional funding would need to be identified as it is not a budgeted item.
ATTACHMENTS:
1. Welcome Baby event flyer City of Montebello
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