Agenda Packet — Hercules City Council, February 24, 2026

Tuesday, February 24, 2026
7:00 PM
City of Hercules
111 Civic Drive
Hercules, CA 94547
City Council
Mayor Chris Kelley
Vice Mayor Alex Walker-Griffin
Council Member Dilli Bhattarai
Council Member Tiffany Grimsley
Council Member Dion Bailey
Dante Hall, City Manager
Christie Crowl, City Attorney
Eibleis Melendez, City Clerk
Meeting Agenda
REGULAR MEETING - 7:00 P.M
In-Person in Council Chambers or Via Zoom:

Zoom ID: 860 6186 1627 Zoom Passcode: 339226
Zoom Phone Number: 1-669-900-6833
1 February 24, 2026City Council Meeting Agenda
See last pages of agenda for information regarding meeting procedures To view webcast of meetings, live or on demand, go to the City's website at www.ci.hercules.ca.us I. SPECIAL CLOSED SESSION – CALL TO ORDER - ROLL CALL - NONE II. PUBLIC COMMUNICATION - CLOSED SESSION ITEMS - NONE III. CONVENE INTO CLOSED SESSION - NONE
IV. REGULAR MEETING – CONVENE TO OPEN SESSION - ROLL CALL - 7:00 P.M.

V. A. REPORT ON ACTION TAKEN IN CLOSED SESSION-

NO CLOSED SESSION
B. CONSIDER AND TAKE ACTION ON ANY REQUEST FROM A COUNCIL MEMBER TO

PARTICIPATE IN A MEETING REMOTELY DUE TO JUST CAUSE OR EMERGENCY CIRCUMSTANCES PURSUANT TO AB 2449
VI. PLEDGE OF ALLEGIANCE
VII. MOMENT OF SILENCE
VIII. INTRODUCTIONS/PRESENTATIONS/COMMISSION REPORTS

1. 26-045
Proclamation - Recognizing February 17 through March 3, 2026 as Lunar New Year in the City of Hercules
ProclamationAttachments:

2. 26-046 Proclamation - Recognizing Jeff Brown, Public Works Superintendent's, Retirement and Years of Service
ProclamationAttachments:

IX. AGENDA ADDITIONS/DELETIONS

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2 February 24, 2026City Council Meeting Agenda
X. PUBLIC COMMUNICATIONS
This time is reserved for members of the public to address issues not included in the agenda. In accordance with the Brown Act, Council will refer to staff any matters brought before them at this time, and those matters may be placed on a future agenda.

Individuals wishing to address the City Council are asked to complete a form indicating the name and address of the speaker and the general topic to be addressed. Speakers must make their comments from the podium and will be allowed 3 minutes to discuss their concerns. All public comments are recorded and become part of the public record. A limit of 30 minutes will be devoted to taking public comment at this point in the agenda. If any speakers remain at the conclusion of the initial 30 minute period, time will be reserved at the conclusion of the meeting to take the remaining comments.

XI. PUBLIC HEARINGS
XII. CONSENT CALENDAR

1. 26-039
Meeting Minutes for the Regular Meeting of February 10, 2026 Meeting Minutes for the Regular Meeting of February 10, 2026Attachments:

2. 26-040 Update on the Chief’s Advisory Board (CAB)
RECOMMENDATION:

Receive an update on the Chief’s Advisory Board (CAB)
2026 Chief's Advisory Board ReportAttachments:

3. 26-041 Resolution Approving the Continuance of an Annual Parcel Assessment to be Adopted by the County Flood Control District for the Contra Costa Clean Water Program for Fiscal Year 2026-27 RECOMMENDATION:

Adopt a resolution approving the continuance of the parcel assessment rate of $35.00 per Equivalent Runoff Unit (ERU) for Fiscal Year (FY) 2026-2027 and requesting the Contra Costa County Flood Control and Water Conservation District adopt this annual parcel assessment for drainage maintenance under the National Pollution Discharge Elimination System (NPDES) Program.

Staff Report - FY 26-27 Annual Stormwater Assessment
Attach 1 - Resolution - 2026-2027 Annual Stormwater Assessment Attach 2 - Request to MC for ERU Resolutions & Annual Budgets Attachments:

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3 February 24, 2026City Council Meeting Agenda

4. 26-042 Adopt a Resolution to Amend the Salary Range for the City Manager Classification and Amend the FY 2025-2026 Master Salary Schedule pursuant to California Public Employees Retirement System (CalPERS)
RECOMMENDATION:

Adopt a Resolution approving an amended salary range for the City Manager classification and approving an amended Fiscal Year 2025-2026 Master Salary Schedule pursuant to California Public Employees Retirement System (“CalPERS”) effective July 6, 2025 (last updated on February 12, 2026).

Staff Report - Amend City Manager Salary Range and Salary Schedule Attach 1 - Resolution
Attach 2 - FY 25-26 Salary Schedule
Attachments:

5. 26-043 Appointment of J. Patrick Tang as Interim City Manager RECOMMENDATION:

Adopt a Resolution approving the Employment Agreement for the Interim City Manager and authorizing the Mayor to execute the Employment Agreement on behalf of the City of Hercules.

Staff Report -Interim City Manager
Attach 1 - Resolution
Attach 2 - Employment Agreement between City of Hercules and J. Patrick Tang Attachments:

6. 26-044 Execute a Professional Services Agreement with Kennedy & Associates, Inc. to provide Implementation Support for the Clean Water Program for Fiscal Year 2026-27
RECOMMENDATION:

Adopt a Resolution authorizing the City Manager to execute a Professional Services Agreement with Kennedy & Associates, Inc. (Kennedy) to provide Implementation Support for the Clean Water Program for Fiscal Year 2026-27 for a Total Cost of $54,305.35.

Staff Report - FY 26-27 CWP Annual Contract Kennedy
Attach 1 - Resolution
Attach 2 - Kennedy & Associates - FY 2025-26 Stormwater Program Attachments:

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7. 26-052 “Shop Hercules” Yiftee Gift Card program
RECOMMENDATION:

Approve a resolution approving a fourth amendment to an agreement with Yiftee in the amount of $25,000 for the “Shop Hercules” digital gift card incentive program, and amending the FY 25-26 budget increasing its appropriation by $25,000.

Staff Report - Shop Hercules Yiftee program
Attach 1 - Resolution
Attach 2 - Draft Amendment No. 4 to the Original Agreement Attach 3 - Original Agreement
Attach 4 - Amendment No. 1 to Original Agreement
Attach 5 - Amendment No. 2 to Original Agreement
Attach 6 - Amendment No. 3 to the Original Agreement
Attachments:

XIII. DISCUSSION AND/OR ACTION ITEMS

1. 26-047 Adoption of a Resolution Amending the Fiscal Year (FY) 2025-26 Operating and Capital Budgets to Reflect the Recommended Mid-year Adjustments
RECOMMENDATION:

The staff recommends that the City Council receive the FY 2025-26 Mid-Year Financial Summary Report and adopt a resolution to amend the FY 2025-26 operating and capital budgets to reflect the proposed mid-year adjustments.

Staff Report - FY 25-26 Mid-Year Budget Update
Attach 1 - Resolution
Attach 2 - Budget Request Detail
Attach 3 - General Fund Summary
Attach 4 - Non-General Fund Summary
Attachments:

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5 February 24, 2026City Council Meeting Agenda

2. 26-054 Contract Amendment No. 2 to the Professional Services Agreement with Gates & Associates, Inc. for Final Design of Beechnut Park Improvement Project
RECOMMENDATION:

Adopt a Resolution authorizing the City Manager to execute an Amendment No. 2 to the City’s November 6, 2023 Professional Services Agreement with Gates & Associates, Inc. to provide Design Services for the Beechnut Park Improvement Project, Increasing the Cost by $84,534 to a Total Cost of $136,329.

Staff Report - Beechnut Park - Gates Final Design - Amendment 2 Attach 1 - Resolution
Attach 2 - 23-076-CM Gates+Associates Agreement - Beechnut Park Project Amendment 2 Attachments:

3. 26-051 Initiation of Fiscal Year 2026/27 Landscaping and Lighting Assessment Districts Proceedings
RECOMMENDATION:

It is recommended by City staff that City Council adopt a resolution directing the filing of the Fiscal Year (FY) 2026/27 Engineer’s Reports for the City of Hercules Landscaping and Lighting Assessment District No. 83-2, Victoria by the Bay Landscaping and Lighting Assessment District No. 2002-1, Hercules Village Landscaping and Lighting Assessment District No. 2002-2, Baywood Landscaping and Lighting Assessment District No. 2004-1, and Bayside Landscaping and Lighting Assessment District No. 2005-1 pursuant to the Landscaping and Lighting Act of 1972.

Staff Report - LLADs Resolution of Initiation
Attach 1 - Resolution
Attachments:

4. 26-049 FY 2025-26 Capital Improvement Program Update RECOMMENDATION:

It is recommended that the City Council receive an update on the status of the FY 2025-26 Capital Improvement Program.

Staff Report - CIP Update
Attach 1 - Fiscal Year 2526 Proposed CIP
Presentation
Attachments:

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6 February 24, 2026City Council Meeting Agenda

5. 26-053 Tiered Business Attraction Grant program
RECOMMENDATION:

Receive a presentation and adopt a resolution approving a Tiered Business Attraction Grant Program and approving an appropriation of $200,000 from the General Fund Reserve for the program.

Staff Report - Business Attraction Grants
Attach 1 - Resolution
Attach 2- Draft Program Guidelines
Attachments:

XIV. PUBLIC COMMUNICATIONS
This time is reserved for members of the public who were unavailable to attend the Public Communications period during Section X of the meeting, or were unable to speak due to lack of time. The public speaker requirements specified in Section X of this Agenda apply to this Section.

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7 February 24, 2026City Council Meeting Agenda
XV. CITY COUNCIL/CITY MANAGER/CITY ATTORNEY ANNOUNCEMENTS,

COMMITTEE, SUB-COMMITTEE AND INTERGOVERNMENTAL COMMITTEE REPORTS

AND FUTURE AGENDA ITEMS
This is the time for brief announcements on issues of interest to the community. In accordance with the provisions of the Brown Act, matters which do not appear on this agenda but require City Council discussion may be either (a) referred to staff or other resources for factual information or (b) placed on a future meeting agenda.

1. Regional Committee
a. Contra Costa Mayors Conference
b. Hercules/ Pinole - WasteWater Management
c. League of Cities
d. Water Emerg. Transportation Authority
e. WCCIWMA
f. WCCTAC
g. West Co. Mayors & Supervisors Assoc. Meeting
h. WestCat
I. MCE
j. CCTA
k. East Bay Wildfire Coalition of Governments

2. City Council Committees and Subcommittees
a. Econ. Dev. Subcommittee
b. Traffic and Public Safety Committee
c. East Bay Economic Development Alliance
d. Education Subcommittee

3. Commission Liaisons
a. Community & Library Services Commission
b. Finance Commission
c. Planning Commisison
XVI. ADJOURNMENT
The next Regular Meeting of the City Council will be held on Tuesday, March 10, 2026 at 7:00p.m. in the Council Chambers.

Agendas are posted in accordance with Government Code Section 54954.2(a) or Section 54956.

Members of the public can view electronic agendas and staff reports by accessing the City website at www.ci.hercules.ca.us and can receive e-mail notification of agenda and staff report postings by signing up to receive an e-notice from the City’s homepage. Agendas and staff reports may also be obtained by contacting the City Clerk at (510) 799-8200 (Posted: February 19, 2026)

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8 February 24, 2026City Council Meeting Agenda

INSTRUCTIONS ON HOW TO PARTICIPATE AND WATCH THE HERCULES CITY COUNCIL AND PLANNING

COMMISSION HYBRID MEETINGS
Attend in Person: Hercules City Council Chambers – 111 Civic Drive, Hercules, CA 94547 Attend via Zoom Teleconference: Details provided below and zoom webinar login, passcode and phone numbers provided on the agenda cover.

How to Submit Public Comments
In Person: Attend meeting at the Hercules City Council Chambers, fill out a public speaker card located on the side table and submit it to the City Clerk.

Via Zoom: Members of the public may submit a remote public comment via Zoom video conferencing. Download the Zoom mobile app from the Apple Appstore or Google Play. If you are using a desktop computer, you can test your connection to Zoom by clicking here or go to: https://www.zoom.us/join. Zoom also allows you to join by phone at +1-669-900-6833 or +1-929-205-6099 or +1-253-215-8782.

Written Comments Submitted Electronically: All comments received before 3:00 p.m. the day of the meeting will be provided to the City Council prior to the meeting and posted to the City’s agenda website and located by clicking on the “meeting details” tab. Written comments received after 3:00 p.m. will be provided to City Council and posted to the agenda website the following day. Written comments will not be read aloud during the meeting. Email comments to [email protected]. Please indicate which item on the agenda you are commenting on in the subject line of your email.

Written comments submitted in person or via mail: Additional ways to provide your public comment is to either drop off your comment in person to the front desk receptionist located in the City Hall lobby or to mail your comment to City of Hercules, ATTN: City Clerk – Public Comment (Meeting Date), 111 Civic Drive, Hercules, CA 94547 in time to reach the City Clerk no later than 3:00 p.m. on the day of the meeting or you can submit your comment by telephone by calling (510) 799-8208 no later than 3:00 p.m. on the meeting date.

If you need assistance with public comment, please contact: Eibleis Melendez, City Clerk at [email protected] or by calling (510) 799-8200.

All public comments will become part of the official meeting record. As email containing public meeting comments are part of the official record, note that personal contact information may be published if it is included with your email. The City cannot guarantee that its network and/or the website will not be uninterrupted. To ensure that the City Council receives your written comments, you are strongly encouraged to submit your comments in writing in advance of the meeting by 3:00 p.m. on the day of the Council or Commission meeting.

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9 February 24, 2026City Council Meeting Agenda

OTHER WAYS TO WATCH THE MEETING
Live on Channel 28: City Council meetings will replay the following Thursday at 7:00 p.m. and Saturday at 1:00 p.m.

Planning Commission meetings will replay the following Wednesday at 7:00 p.m. and Saturday at 9:00 a.m.

Video Streamed Live on the City’s Website:

To view City Council and Planning Commission meeting videos online go to: Hercules Meeting Videos.

Instructions to view Live or On-Demand Videos from the City’s website:

1. Go to: Hercules Meeting Videos or https://hercules.legistar.com/calendar.aspx.

2. Locate the desired meeting and date.

3. Click the associated “Video” link (Video status is as follows):

Video = Video is available for on demand viewing.

In Progress = Video is available for viewing during live recording.

Not Available = Video is either unavailable or has not been recorded.

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10 February 24, 2026City Council Meeting Agenda

THE HERCULES CITY COUNCIL ADHERES TO THE FOLLOWING POLICIES,

PROCEDURES AND REGULATIONS REGARDING CITY COUNCIL MEETINGS

1. SPECIAL ACCOMMODATIONS: In compliance with the Americans with Disabilities Act, if you require special accommodations to participate at a City Council meeting, please contact the City Clerk at 510-799-8208 at least 48 hours prior to the meeting.

2. AGENDA ITEMS: Persons wishing to add an item to an agenda must submit the final written documentation 12 calendar days prior to the meeting. The City retains the discretion whether to add items to the agenda. Persons wishing to address the City Council otherwise may make comments during the Public Communication period of the meeting.

3. AGENDA POSTING: Agendas of regular City Council meetings are posted at least 72 hours prior to the meeting at City Hall, the Hercules Swim Center, Ohlone Child Care Center, and on the City’s website (www.ci.hercules.ca.us),

4. PUBLIC COMMUNICATION: Persons who wish to address the City Council should complete the speaker form prior to the Council's consideration of the item on the agenda.

Anyone who wishes to address the Council on a topic that is not on the agenda and is relevant to the Council should complete the speaker form prior to the start of the meeting. Speakers will be called upon during the Public Communication portion of the meeting. In accordance with the Brown Act, the City Council may not take action on items not listed on the agenda. The Council may refer to staff any matters brought before them at this time and those matters may be placed on a future agenda.

In the interests of conducting an orderly and efficient meeting, speakers will be limited to three (3) minutes.

Anyone may also submit written comments at any time before or during the meeting.

5. CONSENT CALENDAR: All matters listed under Consent Calendar are considered to be routine and will be enacted by one motion. There will be no separate discussion of these items unless requested by a member of the Council or a member of the public prior to the time the City Council votes on the motion to adopt.

6. LEGAL CHALLENGES: If you challenge a decision of the City Council in court, you may be limited to raising only those issues you or someone else raised at the meeting or in written correspondence delivered at, or prior to, the meeting. Actions challenging City Council decisions shall be subject to the time limitations contained in Code of Civil Procedure Section 1094.6.

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11 INTRODUCTIONS/PRESENTATIONS/

COMMISSION REPORTS

AGENDA ITEMS

1. 26-045

2. 26-046
12 PROCLAMATION

RECOGNIZING FEBRUARY 17 THROUGH MARCH 3, 2026, AS

LUNAR NEW YEAR IN THE CITY OF HERCULES

WHEREAS, Lunar New Year is a celebration with roots tied in East and Southeast Asian countries including China, Vietnam, Korea and the Asian diaspora; and while celebrations and traditions vary with each unique history and customs; festivities share universal themes of reflection, renewal , togetherness and prosperity for the new year. This year is represented by the Fire Horse, characterizing intense energy, passion, resilience and transformation; and

WHEREAS, Lunar New Year festivities have been carried on for centuries in Asia, the Asian diaspora across the globe continued to preserve and share traditions; and the blending of local culture with anc estral heritage created new variations of Lunar New traditions; and this influence and adaptation is reflective of a universal history of resilience, connection and the journey of human movement and cultural exchange; and

WHEREAS, The City of Hercules ha s a deep history and highly diverse Asian diaspora ranging from long -establish families to recent immigrants and continues to shape the fabric of our community ; makes up approximately 45 percent of the City’s population and is the largest ethnic (Non-Hispanic) group in the City; and

WHEREAS, the Hercules City Council wishes all those who observe this holiday good health; happiness and prosperity as we welcome Lunar New Year and the year of the Fire Horse; and

WHEREAS, the City of Hercules is proud to hold its second Lunar New Year celebration with a Parade and Festival on March 1, 2026; and invites residents, friends and loved ones to join in the festivities and take part in the rich cultural diversity that makes up the fabric of this community.

NOW, THEREFORE, BE IT PROCLAIMED that I, Chris Kelley, Mayor of the City of Hercules, on behalf of the entire City Council and the Hercules community, do hereby recognize February 17 through March 3, 2026 as Lunar New Year in the City of Hercules and invite all to reaffirm our community’s commitment to family, diversity, mutual respect and create an inclusive environment of belonging for all our residents.

In witness whereof, I hereunto set my hand and cause the Seal of the City of Hercules to be affixed this 25th day of February 2026.

Chris Kelley, Mayor
13 INTRODUCTIONS/PRESENTATIONS/

COMMISSION REPORTS

AGENDA ITEMS

2. 26-046
14 PROCLAMATION

RECOGNIZING JEFF BROWN, PUBLIC WORKS

SUPERINTENDENT, UPON HIS RETIREMENT FOR OVER

THIRTY-SIX YEARS OF DEDICATED AND EXCEPTIONAL

SERVICE TO THE CITY OF HERCULES

WHEREAS, Jeff Brown began his career with the City of Hercules on August 15, 1989, when he was hired as a Maintenance Worker I, marking the start of a career commitment to public service and the residents of Hercules; and

WHEREAS, through his strong work ethic, technical knowledge, and commitment to the City and its residents, Mr. B rown was promoted to Maintenance Worker II in September of 1998; and in 1999, he was again promoted to Public Works Inspector, where he demonstrated sound technical judgment and close attention to construction standards and played a key role in the success ful completion of the 2001 Refugio Valley Road Widening Project; and

WHEREAS, in 2002, Mr. Brown served as Acting Public Works Manager during the deployment of his incumbent supervisor to Afghanistan, ensuring continuity of operations and effective leadership during a critical period; and

WHEREAS, Mr. Brown continued to expand his professional expertise by attending the California Specialized Training Institute for Emergency Management Training in September of 2003, and by completing his Building Inspector Certification in July of 2005; and

WHEREAS, in September of 2005, Mr. Brown was promoted to Public Works Utility Inspector; and in 2007, he was again promoted to the position of Public Works Superintendent, where he provided steady leadership, operatio nal oversight, and mentorship to Public Works staff while maintaining essential infrastructure and services for the City; and

WHEREAS, in January 2014, Mr. Brown served as Interim Public Works Director for approximately nine months, stepping forward to lead the department during a period of transition; and in 2024, he once again served the City as Interim Public Works Director for six months, exemplifying his reliability, institutional knowledge, and dedication to the organization; and

WHEREAS, in 2015, Mr. Brown completed the Contra Costa Local Government Leadership Academy; and in 2021, Mr. Brown successfully managed and completed the City’s ENGIE Solar Project, demonstrating his commitment to innovation, sustainability, and responsible stewardship of public resources; and

WHEREAS, Jeff Brown is retiring effective Ma rch 1, 2026, after more than thirty-six years of exemplary service to the City of Hercules and its community.

NOW, THEREFORE, BE IT PROCLAIMED that I, Chris Kelley, Mayor of the City of Hercules, on behalf of the entire City Council, and the Hercules community, do hereby recognize and express sincere appreciation to Jeff Brown for his outstanding service, leadership, and lasting contributions to the City of Hercules, and extend to him best wishes for a happy, healthy, and fulfilling retirement.

In witnes s whereof, I have hereunto set my hand and caused the seal of the City of Hercules to be affixed this 24th day of February 2026.

__________________________________
Chris Kelley, Mayor
15 CONSENT CALENDAR

AGENDA ITEMS

5. 26-043

6. 26-044

7. 26-052

1. 26-039

2. 26-040

3. 26-041

4. 26-042
16 111 Civic Drive
Hercules, CA 94547City of Hercules
Meeting Minutes
City Council
Mayor Chris Kelley
Vice Mayor Alex Walker-Griffin
Council Member Dilli Bhattarai
Council Member Tiffany Grimsley
Council Member Dion Bailey
Dante Hall, City Manager
Christie Crowl, City Attorney
Eibleis Melendez, City Clerk
6:00 PMTuesday, February 10, 2026
CLOSED SESSION 6:00 P.M.; REGULAR MEETING - 7:00 P.M
In-Person in Council Chambers or Via Zoom:

Zoom ID: 864 2648 5820 Zoom Passcode: 748444
Zoom Phone Number: 1-669-900-6833
I. SPECIAL CLOSED SESSION – CALL TO ORDER - ROLL CALL - 6:00 P.M.

1. CONSIDER AND TAKE ACTION ON ANY REQUEST FROM A COUNCIL MEMBER TO

PARTICIPATE IN A MEETING REMOTELY DUE TO JUST CAUSE OR EMERGENCY CIRCUMSTANCES PURSUANT TO AB 2449
Council Member Bhattarai and Vice Mayor Walker-Griffin were not present for roll call but they did attend Closed Session.

II. PUBLIC COMMUNICATION - CLOSED SESSION ITEMS
NONE
III. CONVENE INTO CLOSED SESSION
City Attorney, Christie Crowl, read the title of the item to be discussed in Closed Session. City Council and Staff convened in Closed Session.

The Hercules City Council will meet in Closed Session regarding the following:

1. 26-028
Pursuant to Government Code section 54957: Public Employment (City Manager)
IV. REGULAR MEETING – CONVENE TO OPEN SESSION - ROLL CALL - 7:00 P.M.

Council Member Dilli Bhattarai, Council Member D. Bailey, Mayor C. Kelley, Vice Mayor A. Walker-Griffin, and Council Member T. Grimsley

Present: 5 -

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17 February 10, 2026City Council Meeting Minutes
V. REPORT ON ACTION TAKEN IN CLOSED SESSION
City Attorney Crowl reported out that no reportable action was taken in Closed Session.

VI. PLEDGE OF ALLEGIANCE
The Pledge of Allegiance was lead by Council Member Bhattarai.

VII. MOMENT OF SILENCE
Mayor Kelley requested a Moment of Silence for Eduardo Ed Manuel who recently passed away. He served as a Council Member, Mayor and Community and Library Services Commissioner for the city.

VIII. INTRODUCTIONS/PRESENTATIONS/COMMISSION REPORTS

1. 26-027
Proclamation - Black History Month
ProclamationAttachments:

Mayor Kelley read the proclamation. Council made remarks.

IX. AGENDA ADDITIONS/DELETIONS
NONE
X. PUBLIC COMMUNICATIONS
NONE
This time is reserved for members of the public to address issues not included in the agenda. In accordance with the Brown Act, Council will refer to staff any matters brought before them at this time, and those matters may be placed on a future agenda.

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XI. PUBLIC HEARINGS

1. 26-023 Ordinance to repeal and replace Hercules Municipal Code Title 9, Chapters 1-18, re-locating appeals provisions, adopting by reference Contra Costa County Ordinance No. 2025-19, No. 2025-15, and No. 2025-14, which adopts the 2025 California Code of Regulations, Title 24, with changes, additions, and deletions, adopting by reference the Uniform Code for Abatement of Dangerous Buildings 1997 edition with existing amendments, additions, and deletions, and adopting by reference the International Property Maintenance Code 2024 Edition with amendments, additions, and deletions
RECOMMENDATION:

That the City Council:

1. Request planning staff present the staff report;

2. Open the public hearing;

3. Receive comments from the public;

4. Close the public hearing;

5. Request clarification from staff on any issues related to the Ordinance;

6. Waive second reading and adopt Ordinance.

Staff Report
Attach 1 - Construction Codes 2025 Ordinance
Attach 2 - Building Code Ord No. 2025-19
Attach 3 - Fire Code Ord No. 2025-14
Attach 4 - WUI Ord No. 2025-15
Attachments:

Community Development Director, Tim Rood, introduced and presented the Staff Report. Mayor Kelley opened the Public Hearing. No public comment. Mayor Kelley closed the Public Hearing. Council asked questions and made remarks. City Manager Hall and Director Rood provided a response. Action was taken on this item.

MOTION: A motion was made by Council Member Bailey, seconded by Vice Mayor Walker-Griffin, to adopt Ordinance 556. The motion carried by the following vote:

Aye: Council Member Dilli Bhattarai, Council Member D. Bailey, Mayor C. Kelley, Vice Mayor A. Walker-Griffin, and Council Member T. Grimsley 5 -
XII. CONSENT CALENDAR
MOTION: A motion was made by Council Member Grimsley, seconded by Vice Mayor Walker-Griffin, to adopt the Consent Calendar. The motion carried by the following vote:

Aye: Council Member Dilli Bhattarai, Council Member D. Bailey, Mayor C. Kelley, Vice Mayor A. Walker-Griffin, and Council Member T. Grimsley 5 -

1. 26-024
Meeting Minutes for the Regular Meeting of January 27, 2026

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19 February 10, 2026City Council Meeting Minutes
Meeting Minutes for the Regular Meeting of January 27, 2026.pdfAttachments:

APPROVED

2. 26-017 Amendment No. 1 with Tai Ginsberg & Associates LLC (“TG&A”) for an amount not to exceed $50,000 to Provide Strategic Federal Advocacy Consulting Services to Advance the Hercules Hub Project RECOMMENDATION:

Adopt a Resolution approving a $50,000 contract amendment with Tai Ginsberg & Associates LLC (“TG&A”) to provide strategic federal advocacy consulting services to advance the Hercules Hub Project and appropriating $50,000 from the General Fund Reserves to fund the contract fully.

Staff Report
Attach 1 - Resolution
Attach 2 - TGA Engagement Letter (Amendment No. 1)
Attachments:

RESOLUTION 26-005, APPROVED.

3. 26-025 Accept the Investment Report for the Quarter Ending December 31, 2025 RECOMMENDATION:

Accept the Investment Report for the Quarter Ending December 31, 2025.

Staff Report
Attach - 1 Quarterly Investment Report
Attachments:

APPROVED
XIII. DISCUSSION AND/OR ACTION ITEMS

1. 26-019 Authorize the City Manager to amend the Lew Edwards Group contract for an amount not to exceed $75,000 to add the production and communications services related to the Election Opinion Poll Services; and amend the FY 2025-26 Budget to appropriate an additional $75,000 for these associated services from the General Fund Reserve RECOMMENDATION:

Staff recommends that the City Council adopt a resolution authorizing the City Manager to amend the Lew Edwards Group contract for an amount not to exceed $75,000 to add the production and communications services related to the Election Opinion Poll Services; and amend the FY 2025-26 Budget to appropriate an additional $75,000 for these associated services from the General Fund Reserve.

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20 February 10, 2026City Council Meeting Minutes
Staff Report
Attach 1 - Resolution
Attach 2 - 25-073 Lew Edwards Group Opinion Poll Services Agreement
Attach 3 - LEG. Add-on Production Services
Attach 4 - Highlights of Winter 2025 Local Funding Measure Survey Attachments:

City Manager, Dante Hall, introduced and presented the Staff Report. A representative from Lew Edwards attended the meeting via Zoom to answer questions. No public comment. Council asked questions and provided comment. City Manager Hall provided a response. Action was taken on this item.

MOTION: A motion was made by Vice Mayor Walker-Griffin, seconded by Council Member Bhattarai, to adopt Resolution 26-006. The motion carried by the following vote:

Aye: Council Member Dilli Bhattarai, Council Member D. Bailey, Mayor C. Kelley, Vice Mayor A. Walker-Griffin, and Council Member T. Grimsley 5 -

2. 26-022
Update the City of Hercules Affordable Housing Policy to Increase Maximum Occupancy Levels
RECOMMENDATION:

Staff recommends that the City Council adopt a Resolution amending the City of Hercules Affordable Housing Policy to increase the maximum occupancy levels to be consistent with occupancy standards for affordable units as set by the California Civil Rights Department (formerly the Department of Fair Employment and Housing) and the federal Department of Housing and Urban Development (HUD).

Staff Report
Attach 1 - Resolution
Attach 2 - Amended Affordable Housing Policy
Attachments:

Community Development Director, Tim Rood, introduced and presented the Staff Report. Council asked questions and provided remarks.

Director Rood provided a response. No public comment. Action was taken on this item.

MOTION: A motion was made by Council Member Grimsley, seconded by Vice Mayor Walker-Griffin, to adopt Resolution 26-007. The motion carried by the following vote:

Aye: Council Member Dilli Bhattarai, Council Member D. Bailey, Mayor C. Kelley, Vice Mayor A. Walker-Griffin, and Council Member T. Grimsley 5 -
XIV. PUBLIC COMMUNICATIONS
NONE

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21 February 10, 2026City Council Meeting Minutes
This time is reserved for members of the public who were unavailable to attend the Public Communications period during Section X of the meeting, or were unable to speak due to lack of time. The public speaker requirements specified in Section X of this Agenda apply to this Section.

XV. CITY COUNCIL/CITY MANAGER/CITY ATTORNEY ANNOUNCEMENTS,

COMMITTEE, SUB-COMMITTEE AND INTERGOVERNMENTAL COMMITTEE REPORTS

2. City Council Committees and Subcommittees
a. Econ. Dev. Subcommittee
b. Traffic and Public Safety Committee
c. East Bay Economic Development Alliance
d. Education Subcommittee

3. Commission Liaisons
a. Community & Library Services Commission
b. Finance Commission
c. Planning Commisison
City Manager Hall and City Attorney Crowl had no announcements

1. Regional Committees
Council Member Bailey reported out on the Marin Clean Energy(MCE) board meeting. Mayor Kelley reported out on the East Bay Economic Development Alliance board meeting and the Contra Costa Mayors Conference.

2. City Council Committees and Subcommitees

Page 6 ends

22 February 10, 2026City Council Meeting Minutes
No reports were provided

3. Commission Liaisons
No reports were provided
Council Members also reported out on events that they attended through out the city and county which included the Refugio Lake Dredging Project meeting and the Hercules Police Department Awards Ceremony.

There were no future agenda item requests from Council Members.

XVI. ADJOURNMENT
Mayor Kelley adjourned the meeting at 8:01 p.m.
_________________________________
Chris Kelley, Mayor
Attest:
_______________________________
Eibleis Melendez, City Clerk

Page 7 ends

23 CONSENT CALENDAR

AGENDA ITEMS

2. 26-040
24 STAFF REPORT TO THE CITY COUNCIL

DATE: Regular Meeting of February 24th, 2026
TO: Mayor and Members of the City Council
VIA: Dante Hall, City Manager
SUBMITTED BY: Joseph Vasquez, Chief of Police
SUBJECT: Update on the Chief’s Advisory Board (CAB)
RECOMMENDED ACTION:

Receive an update on the Chief’s Advisory Board (CAB).

EXECUTIVE SUMMARY:

The Chief’s Advisory Board was created in May of 2021 by then Chief of Police William Imboden. The intent behind the CAB was to have representation throughout various communities in the city with two -year terms to prevent discussions from going stale and allowing others in the city an opportunity to participate on the board. These members were to serve as a direct conduit between the Police Department and the community and provide invaluable information on how to provide better public safety services. Eight community members were selected from various neighborhoods, ethnic backgrounds, and personal experiences with public safety. Out of the original eight members, only four remain on the board as many of the original members were unable to fulfill the attendance requirement. Chief of Police Joseph Vasquez took over the CAB in October 2022 after Chief Imboden retired. Over the last th ree years, the CAB included a student from Hercules High School, and a college student which brought a unique and youthful perspective. Both have since moved on, but we hope to include more youth in the future.

Some of the accomplishments this group has achieved include helping the Chief develop a mission and vision statement as well as the core values that guide all personnel in the police department. The CAB has also helped navigate the department through difficult incidents and develop new policies and procedures.
25 During the Council Meeting of October 14, 2025, that the City Council directed the Chief of Police to provide periodic informational updates of CAB meetings to the City Council.

Below is a summary of discussions from the 2025 monthly CAB meetings.

ANALYSIS:

The calendar year of 2025 included many accomplishments, community engagements, and some challenges for the Police Department. Members of the CAB participated in various community events and engaged in discussions on topics that occurred within the city, across the state, around the nation, and sometimes even globally.

Use of force: The CAB discussed the use of force and reviewed our policy, including when and how force is authorized. We discussed how the use of force is reviewed internally and that it may also be reviewed externally when an independent, unbiased opinion is needed . Use of force has always been a heavily criticized component of law enforcement and should be used only as a last resort, with only the amount of force necessary to effect an arrest. Some specific incidents discussed by the CAB included the traffic stop of the Miami Dolphins wide receiver Tyreek Hill and arrests made by ICE.

Community Awareness: Throughout the year, crime rates tend to rise and become more prevalent. When auto burglaries, vehicle theft, and residential burglaries are on the rise, we discussed the sophisticated methods used to commit these crimes . Situational awareness for crime prevention in their individual commu nities is important , including being aware of criminals impersonating utility workers to see if anyone is home before breaking in.

Community Events: CAB members attended events such as Breakfast with a Badge (designed for the senior community), Coffee wi th a Cop, and “Every 15 Minutes,” which teaches high school juniors and seniors about the consequences of drinking and driving.

Some of the CAB members even participated in our second annual Public Safety Fundraising Golf Tournament, which raised funds for the Youth Academy, including a field trip to Alcatraz.

Immigration and Customs Enforcement (ICE): The to pic of ICE was discussed on multiple occasions as concerns of ICE allegedly conducting enforcement in the City of Hercules has been reported by community members. This concern gained momentum after a 73 -year-old female resident of Hercules was detained by ICE in September of 2025 following a routine appointment at the San Francisco ICE office. Chief Vasquez assured the members of the CAB that ICE has not conducted any operations within the city, and if they do, he would be notified in advance. Other Chiefs of Police in Contra Costa County who have had ICE conduct operations within their cities have confirmed that this is the normal protocol.

26 CAB Concerns and Suggestions: Members of the CAB expressed growing concerns regarding electric bikes and suggested that the PD conduct training for students at local Hercules schools. The Hercules PD Traffic Enforcement Officer is working with school staff to arrange opportunities to provide students with safety and education related to electric bikes. “Orbeezing” was another concern which is a trending social media challenge that many students at the local high schools were participating in to celebrate the end of school year. “Orbeezing” involves firing small gel pellets from a pellet gun at other students in a drive by fashion and is incredibly dangerous. There were some reports of these activities in Hercules at the conclusion of the 2024-2025 school year, and the PD is aware of this trend. One of the members of the CAB suggested organizing a formalized mentorship program for PD staff. While the structure of the PD allows for organic mentoring, PD administration is currently exploring ways to further develop our staff.

FISCAL IMPACT:

There is no fiscal impact associated with receiving this report.

27 CONSENT CALENDAR

AGENDA ITEMS

3. 26-041
28 STAFF REPORT TO THE CITY COUNCIL

DATE: Regular Meeting of February 24, 2026
TO: Mayor and Members of the City Council
VIA: Dante Hall, City Manager
SUBMITTED BY: Glenn Dombeck, Public Works Director
SUBJECT: Resolution Approving the Continuance of an Annual Parcel Assessment to be Adopted by the County Flood Control District for the Contra Costa Clean Water Program for Fiscal Year 2026-27 RECOMMENDED ACTION:

Adopt a resolution approving the continuance of the parcel assessment rate of $35.00 per Equivalent Runoff Unit (ERU) for Fiscal Year ( FY) 2026-2027 and requesting the Contra Costa County Flood Control and Water Conservation District adopt this annual parcel asse ssment for drainage maintenance under the National Pollution Discharge Elimination System (NPDES) Program.

BACKGROUND:

The Contra Costa Clean Water Program was established in the early 1990s and provides stormwater permit coverage for the 20 member agencies under the NPDES Program administered by the San Francisco Regional Water Quality Control Board (RWQCB).

The Clean Water Program is governed by a Management Committee, which consists of a representative from each of the 20 public agency members, including Hercules. All revenue generated in the Hercules’ Stormwater Utility Area (SUA) is required to be expended in that district except for the contribution to the regional program, which is very cost effective due to economies of scale.

29 ANALYSIS:

Regional activities performed by the Flood Control District include negotiating the discharge permit with the RWQCB, provi ding training to member agencies, developing stormwater design standards, public education and outreach, and coordinating the activities of the member agencies. Hercules uses the local funding component for stormwater activities within the city including street sweeping, catch basin cleaning, and creek cleaning. The funding also pays for staff time spent administering these programs.

In order for the Flood Control District to adopt the assessments, each member agency is required to submit a certified resolution approving the assessment rate for the coming fiscal year.

FISCAL IMPACT:

The parcel assessment rate of $35.00 per Equivalent Runoff Unit (ERU), which is the rate charged to a single-family home, has been in effect in Hercules since the 1990s and will generate approximately $322,451 in revenues. A total of $91,830 of this revenu e is retained by the County Flood Control District and constitutes Hercules’ pro rata (by population) contribution for the County to administer the regional Clean Water Program activities on behalf of the 20 member agencies. The remaining $230,621 is returned to Hercules, deposited into the Stormwater Fund, and is used for the local clean water activities mentioned above. This revenue will be included in the FY 26-27 Budget.

ATTACHMENTS:

Attach 1 – Resolution
Attach 2 – County Request for Assessment Resolution

30 HERCULES CITY COUNCIL
RESOLUTION NO. 26-

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES APPROVING THE CONTINUANCE OF THE PARCEL ASSESSMENT RATE OF $35.00 PER EQUIVALENT RUNOFF UNIT (ERU) FOR FY 202 6-2027 AND REQUESTING THE

CONTRA COSTA COUNTY FLOOD CONTROL AND WATER CONSERVATION

DISTRICT TO ADOPT THIS ANNUAL PARCEL ASSESSMENT FOR DRAINAGE

MAINTENANCE UNDER THE NATIONAL POLLUTION DISCHARGE ELIMINATION

SYSTEM (NPDES) PROGRAM

WHEREAS, under the Federal Wate r Pollution Control Act, prescribed discharges of storm water require a permit from the appropriate California Regional Water Quality Control Board under the National Pollution Discharge Elimination System (NPDES) Program; and

WHEREAS, the City of Hercules, County of Contra Costa did apply for, and did receive, an NPDES permit which requires the implementation of selected Best Management Practices to minimize or eliminate pollutants from entering storm waters; and

WHEREAS, it is the intent of the City of Hercules to utilize funds received from its Stormwater Utility Area (SUA) for implementation of the NPDES program and drainage maintenance activities; and

WHEREAS, at the request of the City of Hercules, Contra Costa County Flood Control and Water Conservation District (District) has completed the process for formation of a SUA, including Stormwater Utility Assessment Drainage Ordinance 93-47; and

WHEREAS, the SUA and Program Group Costs Payment Agreement between the City of Hercules and the District requ ires that the City of Hercules determine the rate to be assessed to a single Equivalent Runoff Unit (ERU) annually before May 1 of the forthcoming fiscal year.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Hercules as follows:

1. The City Council hereby approves the continuance of the $35.00 rate per ERU for FY 202 6-2027 and requests the Contra Costa County Flood Control and Water Conservation District adopt an annual parcel assessment for drainage maintenance under the NPDES Program.

The foregoing Resolution was duly and regularly adopted at a special meeting of the City Council of the City of Hercules held on the 24th day of February 2026, by the following vote of the Council:

31 AYES:

NOES:

ABSENT:

ABSTAIN:

____________________________
Chris Kelley, Mayor
ATTEST:

Eibleis Melendez, City Clerk
32 33

CONSENT CALENDAR

AGENDA ITEMS

4. 26-042
34 STAFF REPORT TO THE CITY COUNCIL

DATE: Regular Meeting of February 24, 2026

TO: Mayor and Members of the City Council

VIA: Dante Hall, City Manager

SUBMITTED BY: Kristi Carter, Human Resources Manager

SUBJECT: Adopt a Resolution to Amend the Salary Range for the City Manager Classification and Amend the FY 2025-2026 Master Salary Schedule pursuant to California Public Employees Retirement System (CalPERS)

RECOMMENDED ACTION:

Adopt a Resolution approving an amended salary range for the C ity Manager classification and approving an amended Fiscal Year 2025-2026 Master Salary Schedule pursuant to California Public Employees Retirement System (“CalPERS”) effective July 6, 2025 (last updated on February 12, 2026).

BACKGROUND:

The City Manager classification is a critical executive position responsible for overseeing daily operations, implementing City Council policy direction, managing staff, and ensuring the effective delivery of essential public services.

To ensure the City remains competitive in recruiting and retaining qualified executive leadership, staff conducted a salary survey of comparable agencies, focusing on cities of similar population size, service levels, organizational complexity, and geographic labor market considerations.

The survey results indicate that the City’s current salary rate for the City Manager classification is competitive within the market. However, the classification does not currently include a defined salary range. Establishing a minimum hourly rate will create a formal salary range, provide greater flexibility in recruitment and appointment, and better align the City’s compensation structure with prevailing market practices.

35 ANALYSIS:

Based on the salary survey, comparable agencies offer salaries that reflect the scope of responsibility and experience required for the City Manager role. The survey confirms that the City’s current hourly rate is competitive; however, the classification does not currently include a defined salary range.

To establish a formal salary range and provide appropriate flexibility for recruitment and appointment, staff recommends establishing a minimum hourly rate while maintaining the existing maximum.

Establishing a pay range for the City Manager classification:

 Establishes a defined and competitive salary range for the City Manager classification
 Maintains the City’s competitiveness in the executive labor market  Supports recruitment and retention efforts
 Preserves fiscal responsibility by retaining the current maximum hourly rate

The proposed range of $130.00 to $145. 3638 per hour reflects market conditions and aligns with compensation practices among comparable agencies, while preserving the City Council’s discretion to negotiate within the approved range.

CalPERS regulations require that pay rates for contract employees be reflected on a publicly adopted and posted salary schedule. Approval of the proposed minimum hourly rate will require an update to the City’s FY 2025–2026 CalPERS-compliant Master Salary Schedule to ensure continued compliance.

FISCAL IMPACT:

There is no anticipated fiscal impact, as the FY 25-26 Budget accommodates the highest salary range for this position.

ATTACHMENTS:

1. Resolution

2. Amended Fiscal Year 2025 -2026 Master Salary Schedule effective July 6, 2025 (last updated on February 12, 2026)

36 HERCULES CITY COUNCIL
RESOLUTION 2026-XX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES APPROVING

AN AMENDED SALARY RANGE FOR THE CITY MANAGER CLASSIFICATION AND APPROVING AN AMENDED FISCAL YEAR 2025 -2026 MASTER SALARY SCHEDULE PURSUANT TO CALIFORNIA PUBLIC EMPLOYEES’ RETIREMENT SYSTEM (CalPERS)

WHEREAS, the City Manager classification is a critical executive position responsible for overseeing the daily operations of the City, implementing City Council policy direction, managing City staff, and ensuring the effective delivery of essential public services; and

WHEREAS, the City conducted a salary survey of comparable agencies, focusing on cities of similar population size, service levels, organizational complexity, and geographic labor market considerations; and

WHEREAS, the salary survey confirms that the City’s current hourly rate for the City Manager classification is competitive within the market; and

WHEREAS, the City Manager classification does not currently include a defined salary range; and

WHEREAS, establishing a formal salary range, including a minimum hourly rate, will provide greater flexibility in recruitment and appointment, support retention of qualified executive leadership, and align the City’s compensation practices with prevailing market standards; and

WHEREAS, the proposed salary range of $130.00 to $145.3638 per hour reflects market conditions and preserves the City Council’s discretion to negotiate compensation within the approved range; and

WHEREAS, California Public Employees’ Retirement System (CalPERS) regulations require that pay rates for contract employees be reflected on a publicly adopted and posted salary schedule in order to remain compliant; and

WHEREAS, adoption of a minimum hourly rate for the City Manager classification requires an amendment to the Fiscal Year 2025–2026 Master Salary Schedule effective July 6, 2025 (last updated February 12, 2026); and

NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Hercules as follows:

37 1. The City Council hereby approves the establishment of a salary range for the City Manager classification of $130.00 to $145.3638 per hour.

2. The City Council hereby approves the amended Fiscal Year 2025–2026 Master Salary Schedule effective July 6, 2025 (last updated February 12, 2026), attached hereto and incorporated herein by reference.

3. The City Council directs staff to post and maintain the amended Master Salary Schedule in accordance with CalPERS requirements.

The foregoing Resolution was duly and regularly adopted at a regular meeting of the City Council of the City of Hercules held on the 24th day of February 2026 , by the following vote of the Council:

AYES:

NOES:

ABSENT:

ABSTAIN:

___________________________
Chris Kelley, Mayor
ATTEST:

Eibleis Melendez, City Clerk

38 STEP 1 Effective Date Annual Hours

BARGAINING UNIT/

EMPLOYEE GROUP POSITIONS GRADE ANNUAL HOURLY ANNUAL HOURLY ANNUAL HOURLY ANNUAL HOURLY ANNUAL HOURLY ANNUAL HOURLY MONTHLY CONTRACT CI TY MANAGER CM 270,400.0000 130.0000 302,356.7040 145.3638 2/24/2026 2080 ELECTED OFFICIAL COUNCIL MEMBER CCM 831.6000 12/10/2024 ELECTED OFFICIAL MAYOR CCM 831.6000 12/10/2024
ELECTED OFFICIAL VICE MAYOR CCM 831.6000 12/10/2024
EXECUTIVE CHIEF OF POLICE 057 195,339.6536 98.8561 205,106.8240 103.7990 215,362.2640 108.9890 226,130.4760 114.4385 237,436.5552 120.1602 249,308.5608 126.1683 7/6/2025 1976 EXECUTIVE CHIEF OF POLICE / ASSISTANT CITY MANAGER 57A 205,106.6264 103.7989 215,362.0664 108.9889 226,130.4760 114.4385 237,436.9504 120.1604 249,308.3632 126.1682 261,773.9592 132.4767 7/6/2025 1976 EXECUTIVE CITY CLERK 051 123,097.2912 62.2962 129,252.3336 65.4111 135,714.8416 68.6816 142,500.6232 72.1157 149,625.4864 75.7214 157,106.8200 79.5075 7/6/2025 1976 EXECUTIVE CITY CLERK / ASSISTANT CITY MANAGER 51A 129,252.1360 65.4110 135,715.0392 68.6817 142,500.6232 72.1157 149,625.6840 75.7215 157,106.8200 79.5075 164,962.2104 83.4829 7/6/2025 1976 EXECUTIVE CITY CLERK / PIO 052 132,944.6872 67.2797 139,592.7416 70.6441 146,571.5784 74.1759 153,900.3648 77.8848 161,595.3040 81.7790 169,675.1680 85.8680 7/6/2025 1976 EXECUTIVE CITY CLERK / PIO / ASSISTANT CITY MANAGER 52A 139,591.9512 70.6437 146,572.3688 74.1763 153,900.1672 77.8847 161,595.3040 81.7790 169,675.1680 85.8680 178,158.9264 90.1614 7/6/2025 1976 EXECUTIVE COMMUNITY DEVELOPMENT DIRECTOR 056 180,870.3936 91.5336 189,913.5576 96.1101 199,409.2256 100.9156 209,380.1216 105.9616 219,848.9696 111.2596 230,841.2600 116.8225 7/6/2025 1976

EXECUTIVE COMMUNITY DEVELOPMENT DIRECTOR / ASSISTANT CITY

MANAGER
56A 189,913.9528 96.1103 199,409.2256 100.9156 209,379.7264 105.9614 219,849.1672 111.2597 230,841.4576 116.8226 242,383.2736 122.6636 7/6/2025 1976
EXECUTIVE FINANCE DIRECTOR 056 180,870.3936 91.5336 189,913.5576 96.1101 199,409.2256 100.9156 209,380.1216 105.9616 219,848.9696 111.2596 230,841.2600 116.8225 7/6/2025 1976 EXECUTIVE FINANCE DIRECTOR / ASSISTANT CITY MANAGER 56A 189,913.9528 96.1103 199,409.2256 100.9156 209,379.7264 105.9614 219,849.1672 111.2597 230,841.4576 116.8226 242,383.2736 122.6636 7/6/2025 1976 EXECUTIVE PARKS & RECREATION DIRECTOR 054 155,066.9952 78.4752 162,820.2264 82.3989 170,961.1488 86.5188 179,509.5224 90.8449 188,485.1072 95.3872 197,909.2440 100.1565 7/6/2025 1976

EXECUTIVE PARKS & RECREATION DIRECTOR / ASSISTANT CITY

MANAGER
54A 162,820.4240 82.3990 170,960.7536 86.5186 179,509.1272 90.8447 188,484.9096 95.3871 197,909.4416 100.1566 207,804.6568 105.1643 7/6/2025 1976
EXECUTIVE PUBLIC WORKS DIRECTOR / CITY ENGINEER 057 195,339.6536 98.8561 205,106.8240 103.7990 215,362.2640 108.9890 226,130.4760 114.4385 237,436.5552 120.1602 249,308.5608 126.1683 7/6/2025 1976

EXECUTIVE PUBLIC WORKS DIRECTOR / CITY ENGINEER / ASSISTANT

CITY MANAGER
57A 205,106.6264 103.7989 215,362.0664 108.9889 226,130.4760 114.4385 237,436.9504 120.1604 249,308.3632 126.1682 261,773.9592 132.4767 7/6/2025 1976
MID-MANAGEMENT PUB LIC WORKS SUPERINTENDENT 253 125,693.7552 63.6102 131,978.6208 66.7908 138,576.8800 70.1300 145,506.3168 73.6368 152,781.3560 77.3185 160,420.1768 81.1843 7/6/2025 1976 MID-MANAGEMENT REC REATION MANAGER 248 98,484.6304 49.8404 103,408.4272 52.3322 108,578.8288 54.9488 114,007.8888 57.6963 119,708.4512 60.5812 125,693.9528 63.6103 7/6/2025 1976 MID-MANAGEMENT SEN IOR ACCOUNTANT 249 103,408.2296 52.3321 108,579.0264 54.9489 114,007.8888 57.6963 119,708.2536 60.5811 125,693.7552 63.6102 131,978.8184 66.7909 7/6/2025 1976 NON-REPRESENTED ACC OUNTING TECHNICIAN II 046 83,777.8552 42.3977 87,966.7776 44.5176 92,365.1560 46.7435 96,983.4632 49.0807 101,832.5672 51.5347 106,924.5216 54.1116 7/6/2025 1976 NON-REPRESENTED ADM INISTRATIVE SPECIALIST 045 77,571.8320 39.2570 81,450.7200 41.2200 85,522.6632 43.2807 89,799.3200 45.4450 94,289.3848 47.7173 99,003.5280 50.1030 7/6/2025 1976 NON-REPRESENTED HU MAN RESOURCES ADMINISTRATOR 046 83,777.8552 42.3977 87,966.7776 44.5176 92,365.1560 46.7435 96,983.4632 49.0807 101,832.5672 51.5347 106,924.5216 54.1116 7/6/2025 1976 NON-REPRESENTED HU MAN RESOURCES MANAGER 050 113,978.8416 57.6816 119,677.8232 60.5657 125,656.4088 63.5913 131,945.2264 66.7739 138,541.9048 70.1123 145,469.1680 73.6180 7/6/2025 1976 NON-REPRESENTED HU MAN RESOURCES TECHNICIAN 045 77,571.8320 39.2570 81,450.7200 41.2200 85,522.6632 43.2807 89,799.3200 45.4450 94,289.3848 47.7173 99,003.5280 50.1030 7/6/2025 1976 NON-REPRESENTED PO LICE COMMANDER 055 167,472.5208 84.7533 175,846.6112 88.9912 184,638.2304 93.4404 193,870.1024 98.1124 203,563.7656 103.0181 213,742.1416 108.1691 7/6/2025 1976 POA POLICE OFFICER PO 111,558.3040 53.6338 114,905.4400 55.2430 118,352.0000 56.9000 121,903.1840 58.6073 125,560.2400 60.3655 129,327.1200 62.1765 7/6/2025 2080 PT BENEFITED POLICE OFFICER TRAINEE PTR 100,402.6400 48.2705 7/6/2025 POA POLICE SERGEANT SGT 131,876.5760 63.4022 135,832.3200 65.3040 139,907.8720 67.2634 144,105.1040 69.2813 148,427.7600 71.3595 152,881.0400 73.5005 7/6/2025 2080 PT UNBENEFITED ADMINISTRATIVE SECRETARY PT20 30.6156 32.1464 33.7537 35.4415 37.2135 39.0742 7/6/2025 PT UNBENEFITED FACILITY ATTENDANT PT1 17.5049 18.3327 19.2493 20.2118 21.2223 22.2834 7/6/2025 PT UNBENEFITED INTER ADMIN / ENG / PLANNING PT1 17.5049 18.3327 19.2493 20.2118 21.2223 22.2834 7/6/2025 PT UNBENEFITED LIFEGUARD / SWIM INSTRUCTOR I PT1 17.5049 18.3327 19.2493 20.2118 21.2223 22.2834 7/6/2025 PT UNBENEFITED LIFEGUARD / SWIM INSTRUCTOR II PT2 17.9835 18.8826 19.8269 20.8181 21.8591 22.9519 7/6/2025 PT UNBENEFITED SENIOR LIFEGUARD PT4 19.0787 20.0326 21.0342 22.0860 23.1903 24.3498 7/6/2025 PT UNBENEFITED SPORTS COACH / REFEREE PT1 17.5049 18.3327 19.2493 20.2118 21.2223 22.2834 7/6/2025 PT UNBENEFITED SWIM COACH PT6 20.2406 21.2527 22.3153 23.4311 24.6025 25.8327 7/6/2025 TEAMSTERS FT ACCOUNTING TECHNICIAN I 145 69,967.9864 35.4089 73,466.2968 37.1793 77,139.4832 39.0382 80,996.6352 40.9902 85,046.4472 43.0397 89,298.7992 45.1917 7/6/2025 1976 TEAMSTERS FT ASSISTANT ENGINEER 150 102,805.9448 52.0273 107,946.1136 54.6286 113,343.5576 57.3601 119,010.5280 60.2280 124,961.2520 63.2395 131,209.3640 66.4015 7/6/2025 1976 TEAMSTERS FT ASSISTANT PLANNER 149 95,190.0456 48.1731 99,949.4392 50.5817 104,946.9408 53.1108 110,194.4064 55.7664 115,703.8896 58.5546 121,489.0248 61.4823 7/6/2025 1976 TEAMSTERS FT ASSOCIATE ENGINEER 151 111,030.0568 56.1893 116,582.0240 58.9990 122,410.8288 61.9488 128,531.6864 65.0464 134,958.0336 68.2986 141,705.8760 71.7135 7/6/2025 1976 TEAMSTERS FT COMMUNITY DEVELOPMENT SPECIALIST 146 74,831.5152 37.8702 78,572.8736 39.7636 82,501.7544 41.7519 86,630.8040 43.8415 90,958.0464 46.0314 95,506.0080 48.3330 7/6/2025 1976 TEAMSTERS FT INFORMATION SYSTEMS ADMINISTRATOR 151 111,030.0568 56.1893 116,582.0240 58.9990 122,410.8288 61.9488 128,531.6864 65.0464 134,958.0336 68.2986 141,705.8760 71.7135 7/6/2025 1976 TEAMSTERS FT INFORMATION SYSTEMS SPECIALIST 148 88,138.6896 44.6046 92,545.5648 46.8348 97,172.9616 49.1766 102,031.3528 51.6353 107,132.9896 54.2171 112,489.7280 56.9280 7/6/2025 1976 TEAMSTERS FT LANDSCAPING AND LIGHTING PROGRAM COORDINATOR 147 81,610.1832 41.3007 85,690.8208 43.3658 89,975.3816 45.5341 94,474.5360 47.8110 99,197.9664 50.2014 104,157.9240 52.7115 7/6/2025 1976 TEAMSTERS FT MAINTENANCE AIDE 141 51,428.5616 26.0266 54,000.3256 27.3281 56,700.1344 28.6944 59,534.9040 30.1290 62,511.7480 31.6355 65,637.3848 33.2173 7/6/2025 1976 TEAMSTERS FT MAINTENANCE WORKER I 143 59,985.8272 30.3572 62,985.3952 31.8752 66,134.3488 33.4688 69,441.3824 35.1424 72,913.4120 36.8995 76,558.9344 38.7444 7/6/2025 1976 TEAMSTERS FT MAINTENANCE WORKER II M46 74,104.7424 37.5024 77,809.9400 39.3775 81,700.6840 41.3465 85,785.4712 43.4137 90,074.7744 45.5844 94,578.6712 47.8637 7/6/2025 1976 TEAMSTERS FT MANAGEMENT ANALYST 147 81,610.1832 41.3007 85,690.8208 43.3658 89,975.3816 45.5341 94,474.5360 47.8110 99,197.9664 50.2014 104,157.9240 52.7115 7/6/2025 1976 TEAMSTERS FT PARKING ENFORCEMENT OFFICER 142 57,023.6056 28.8581 59,875.1712 30.3012 62,868.8112 31.8162 66,012.2320 33.4070 69,312.9424 35.0774 72,778.4512 36.8312 7/6/2025 1976 TEAMSTERS FT POLICE SUPPORT SPECIALIST 145 69,967.9864 35.4089 73,466.2968 37.1793 77,139.4832 39.0382 80,996.6352 40.9902 85,046.4472 43.0397 89,298.7992 45.1917 7/6/2025 1976 TEAMSTERS FT PUBLIC WORKS INSPECTOR / SPECIALIST 147 81,610.1832 41.3007 85,690.8208 43.3658 89,975.3816 45.5341 94,474.5360 47.8110 99,197.9664 50.2014 104,157.9240 52.7115 7/6/2025 1976 TEAMSTERS FT PUBLIC WORKS SUPERVISOR 147 81,610.1832 41.3007 85,690.8208 43.3658 89,975.3816 45.5341 94,474.5360 47.8110 99,197.9664 50.2014 104,157.9240 52.7115 7/6/2025 1976 TEAMSTERS FT RECREATION COORDINATOR 146 74,831.5152 37.8702 78,572.8736 39.7636 82,501.7544 41.7519 86,630.8040 43.8415 90,958.0464 46.0314 95,506.0080 48.3330 7/6/2025 1976 TEAMSTERS FT RECREATION SUPERVISOR 147 81,610.1832 41.3007 85,690.8208 43.3658 89,975.3816 45.5341 94,474.5360 47.8110 99,197.9664 50.2014 104,157.9240 52.7115 7/6/2025 1976 TEAMSTERS FT RECREATION TECHNICIAN 145 69,967.9864 35.4089 73,466.2968 37.1793 77,139.4832 39.0382 80,996.6352 40.9902 85,046.4472 43.0397 89,298.7992 45.1917 7/6/2025 1976 TEAMSTERS FT SENIOR CLERK 143 59,985.8272 30.3572 62,985.3952 31.8752 66,134.3488 33.4688 69,441.3824 35.1424 72,913.4120 36.8995 76,558.9344 38.7444 7/6/2025 1976 TEAMSTERS FT SENIOR PLANNER 151 111,030.0568 56.1893 116,582.0240 58.9990 122,410.8288 61.9488 128,531.6864 65.0464 134,958.0336 68.2986 141,705.8760 71.7135 7/6/2025 1976 TEAMSTERS FT SEWER AND STORMWATER SUPERVISOR 147 81,610.1832 41.3007 85,690.8208 43.3658 89,975.3816 45.5341 94,474.5360 47.8110 99,197.9664 50.2014 104,157.9240 52.7115 1/27/2026 1976 TEAMSTERS PT AQUATICS POOL MANAGER PT12 24.1683 25.3767 26.6456 27.9779 29.3767 30.8455 7/6/2025 TEAMSTERS PT OFFICE ASSISTANT I PT1 17.5049 18.3327 19.2493 20.2118 21.2223 22.2834 7/6/2025 TEAMSTERS PT OFFICE ASSISTANT II PT2 17.9835 18.8826 19.8269 20.8181 21.8591 22.9519 7/6/2025 TEAMSTERS PT RECREATION AIDE PT1 17.5049 18.3327 19.2493 20.2118 21.2223 22.2834 7/6/2025 TEAMSTERS PT RECREATION LEADER I PT2 17.9835 18.8826 19.8269 20.8181 21.8591 22.9519 7/6/2025 TEAMSTERS PT RECREATION LEADER II PT7 20.8477 21.8902 22.9848 24.1339 25.3407 26.6076 7/6/2025 TEAMSTERS PT RECREATION LEADER III PT11 23.4643 24.6376 25.8694 27.1629 28.5210 29.9471 7/6/2025 TEAMSTERS PT RECREATION SPECIALIST PT4 19.0787 20.0326 21.0342 22.0860 23.1903 24.3498 7/6/2025 Last Revised 02/12/2026
Adopted by City Council on 02/24/2026
STEP 6
FY 2025-2026 SALARY SCHEDULE
STEP 1 STEP 2 STEP 3 STEP 4 STEP 5
39 CONSENT CALENDAR

AGENDA ITEMS

5. 26-043
40 STAFF REPORT TO THE CITY COUNCIL

DATE: Regular Meeting of February 24, 2026

TO: Mayor and Members of the City Council

VIA: Dante Hall, City Manager

SUBMITTED BY: Kristi Carter, Human Resources Manager

SUBJECT: Appointment of J. Patrick Tang as Interim City Manager

RECOMMENDED ACTION:

Adopt a Resolution approving the Employment Agreement for the Interim City Manager and authorizing the Mayor to execute the Employment Agreement on behalf of the City of Hercules.

BACKGROUND:

City Manager Dante Hall has provided notice to the City that he has accepted the City Manager position with the City of Monterey, with his last day of service to the City of Hercules on March 23, 2026. While the City is in the process of retaining an executive recruitment firm to conduct a comprehensive search for a permanent City Manager, it is necessary to appoint an Interim City Manager to ensure continuity of leadership during the recruitment and selection process.

The City Council ha s authorized staff to negotiate an Employment Agreement with J.

Patrick Tang to serve as Interim City Manager. J. Patrick Tang possesses the experience and specialized skills necessary to perform the duties of City Manager on an interim basis while the City conducts its recruitment for a permanent City Manager.

The attached draft Employment Agreement provides for J. Patrick Tang to commence service on March 2 4, 2026 and ending on the sooner of 12 months or the date immediately preceding the date on which the permanent appointee to the vacant position of City Manager commences their employment, or the date that this appointment is terminated by the City or J. Patrick Tang as is specified in the employment agreement.

41 FISCAL IMPACT:

J. Patrick Tang’s compensation is provided in the proposed Employment Agreement for Interim City Manager, provided with this report as Attachment 2. The appointment of an interim City Manager is not expected to have any fiscal impact, as the costs incurred will be offset by the salary savings generated from this position.

ATTACHMENTS:

1. Resolution

2. Draft Employment Agreement for Interim City Manager

42 HERCULES CITY COUNCIL
RESOLUTION 2026-XX

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES APPROVING

THE TERMS AND CONDITIONS OF EMPLOYMENT FOR INTERIM CITY MANAGER

WHEREAS, due to the resignation of City Manager Dante Hall, which becomes effective on March 23, 2026, the City now desires to hire a professional, highly ethical, and qualified Interim City Manager to serve the City until a permanent City Manager can be appointed; and

WHEREAS, the City Council has determined that J. Patrick Tang possesses the combination of qualifications, credentials and experience necessary to succeed as the Interim City Manager of the City of Hercules; and

WHEREAS, the City Council has authorized staff to negotiate an Employment Agreement with J. Patrick Tang to serve as Interim City Manager for a period not to exceed one (1) year; and

WHEREAS, J. Patrick Tang has agreed to serve as Interim City Manager of the City of Hercules, in accordance with the terms and conditions contained in said Employment Agreement.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Hercules that following the resignation of Dante Hall, effective on March 23, 2026, J.

Patrick Tang is hereby retained effective on March 24, 2026 as Interim City Manager of the City of Hercules in accordance with the terms and conditions of said Employment Agreement.

BE IT FURTHER RESOLVED that the Employment Agreement for Interim City Manager is hereby approved, and the Mayor is authorized to execute said Employment Agreement on behalf of the City of Hercules.

The foregoing Resolution was duly and regularly adopted at a regular meeting of the City Council of the City of Hercules held on the 24th of February 2026, by the following vote of the Council:

43 AYES:

NOES:

ABSENT:

ABSTAIN:

___________________________
Chris Kelley, Mayor
ATTEST:

Eibleis Melendez, City Clerk

44 1

AGREEMENT OF EMPLOYMENT BETWEEN
THE CITY OF HERCULES AND J. PATRICK TANG

This Agreement of Employment (“Agreement”) is entered into effective on the 24th day of March, 2026 (the “Effective Date ”), by and between the City of Hercules, a California municipal corporation, and the City of Hercules as Successor to the Redevelopment Agency, hereinafter collectively referred to as the “City,” and J. Patrick Tang, hereinafter referred to as the “Interim City Manager,” and collectively the “Parties.”

RECITALS

WHEREAS, the City desires to appoint an Interim City Manager to serve on a limited term basis, as it conducts a recruitment for a permanent City Manager; and

WHEREAS, pursuant to Government Code sections 7522.56(c) and 21221(h), the City finds that specialized knowledge, skills, and training are necessary to render the services necessary to do the work contemplated under this Agreement; and

WHEREAS, the City has determined that J. Patrick Tang, a California Public Employees’ Retirement System (CalPERS) retiree, is qualified by his training and experience to render such services; and

WHEREAS, J. Patrick Tang desires to provide such services; and

WHEREAS, the public interest will be served by this Agreement; and

NOW, THEREFORE, the Parties hereto do mutually agree as follows:

Section 1. Duties

The City agrees to employ J. Patrick Tang to serve as the Interim City Manager of the City of Hercules to perform the functions and duties as specified by the ordinances of the City of Hercules as such ordinances may be amended from time to time, and to perform other legally permissible and proper duties and functions as the City Council shall from time to time assign.

The Interim City Manager agrees that, to the best of his ability and experience, he will, at all times, loyally and conscientiously perform all of the duties and obligations required of him, either expressly or implicitly by the terms of the Agreement.

Section 2. Term

Subject to earlier termination as provided for in this Agreement, the Interim City Manager shall be appointed by the City to perform the duties described in Section 1 above for a period commencing on March 24, 2026, and ending when a permanent City Manager assumes office; and agrees to remain in the employ of the City during the term of this Agreement.

Section 3. At-Will

During the term of this Agreement, Interim City Manager understands and acknowledges that he is an at -will employee of the City and therefore may be terminated by the City without cause in accordance with the termination provision set forth in Section 4 below. 45 2

Section 4. Termination

Termination By City. Termination of this Agreement shall require three affirmative votes of the City Council of the City, and upon giving 14 days’ prior notice to the Interim City Manager.

A. Termination By Interim City Manager or Expiration of Term. Nothing in this Agreement shall prevent, limit, or otherwise interfere with the right of the Interim City Manager to resign at any time from his position, provided however, he shall endeavor to give at least 14 days’ prior written notice to the City.

B. In no event shall Interim City Manager continue to perform services for the City under this Agreement beyond the Agreement’s expiration, as set out in Section 2 above.

Section 5. Salary

The City agrees to pay the Interim City Manager for his services rendered a monthly salary of twenty three thousand and four hundred dollars ($23,400.00), which equates to an hourly rate of one hundred thirty-five dollars ($135.00) for an average of 40 hours per week worked, payable in installments at the same time as other employees of the City are paid.

Consistent with the requirement of Government Code sections 21221(h) and 7522.56(d), this hourly rate is not more than the maximum, nor less than the minimum, monthly base salary paid to other previous employees performing comparable duties as listed on a publicly available pay schedule for the City Manager position, divided by 173.333.

Section 6. Sick Leave, Holidays and Vacation; Public Employees Retirement System

The Interim City Manager acknowledges and agrees that during the term of this Agreement, he will not accrue nor be entitled to vacation, sick, or administrative leave. Nor shall he accrue retirement, pension system contributions or health care benefits, including coverage under the California Public Employee Retirement System, or other fringe benefits provided to City employees. The Interim City Manager recognizes that Government Code section 21221(h) provides that a retired person appointed to a vacant position pursuant to that subdivision may not receive any benefits, incentives, compensation in lieu of benefits, or any other forms of compensation in addition to the hourly rate.

Section 7. Business Expenses

The City agrees to budget and allocate sufficient funds to pay for City -related business expenses of the Interim City Manager. This shall include, but not necessarily be limited to, Interim City Manager’s necessary travel expenses while representing the City for such official meetings and/or travel as are reasonably necessary for the Interim City Manager to carry out his professional responsibilities.

Section 8. Indemnification

Except as set forth in Paragraphs 13 and 14 below, the City shall defend, hold harmless and indemnify the Interim City Manager against any tort, professional liability claim or demand or other legal action, whether groundless or otherwise, arising out of an alleged act or omission occurring during the course and scope of the performance of the Interim City Manager’s duties.

46 3

Section 9. Bonding

The City shall bear the full cost of any fidelity or other bonds required of the Interim City Manager under any law or ordinance.

Section 10. Abuse of Office

If the City provides (i) p aid leave salary to the Interim City Manager pending an investigation, or (ii) funds for the legal criminal defense of the Interim City Manager, then in the event the Interim City Manager is convicted of a crime involving an abuse of his office or position as defined in California Government Code Section 53243.4, all such sums paid by the City to the Interim City Manager or for the City Manager’s benefit shall be fully reimbursed to the City by the Interim City Manager.

Section 11. Certification Regarding Prior Unemployment Benefits

In accordance with Government Code section 7522.56(e)(1), the Interim City Manager certifies and warrants to the City that he has not received any unemployment insurance payments for retired annuitant work for any public employer within the twelve months prior to his appointment date under this Agreement.

Section 12. Adequate Retirement Period

In accordance with Government Code section 7552.56(f), the Interim City Manager warrants to City that a period of 180 days or more ha s passed since the date of his most recent retirement with CalPERS.

Section 13. Effect of Agreement on CalPERS Retirement Benefits

The City makes no representation on the impact, if any, this Agreement shall or may have upon the Interim City Manager CalPERS retirement benefits, status, duties and/or obligations.

The Interim City Manager acknowledges that in entering into this Agreement, he has not relied upon any such representations in assessing the CalPERS -related impact of his employment.

Therefore, the Interim City Manager releases the City from any and all CalPERS -related claims or liabilities that may arise in connection with his employment pursuant to this Agreement.

Section 14. Work Restrictions

Due to his status as a CalPERS retiree, the Interim City Manager may not work more than 960 hours for all public agencies contracting with CalPERS within the fiscal year(s) occurring during the term of this Agreement without impacting his retirement benefi ts and having to be reinstated in CalPERS as an active employee. Accordingly, under no circumstances may the Interim City Manager work more than 960 hours during any fiscal year, defined as the period beginning July 1st and ending June 30th of each year, i ncluding any service to other CalPERS employers. The Interim City Manager shall keep accurate time records of his hours worked to ensure that he does not exceed 960 hours within any fiscal year that occurs during the term of this Agreement and for payroll purposes. The Interim City Manager further represents that he will not perform work for any other public agency member of CalPERS during the term of this Agreement. If a controversy arises between the Interim City Manager and CalPERS regarding the impact o f this Agreement and the services provided for herein on the nature of CalPERS 47 4

retirement terms or benefits, the City shall have no obligation to intervene in or to defend or prosecute such dispute.

Section 15. Other Terms and Conditions of Employment

The City Council, in consultation with the Interim City Manager, shall fix any such other terms and conditions of employment as it may determine from time to time, relating to the performance of the Interim City Manager, provided such terms and conditions are not inconsistent with or in conflict with the provisions of this Agreement, City ordinances, or any other law.

Section 16. No Reduction of Salary

The City shall not, at any time during the term of this Agreement, unilaterally reduce the salary of the Interim City Manager.

Section 17. Notices

Notices pursuant to Agreement shall be given by deposit in the custody of the United Stated Postal Service, postage prepaid. Alternatively, notices required pursuant to this Agreement may be personally served in the same manner as is applicable to civil judicial practice, or as the Parties may agree in writing. Notice shall be deemed given as of the date of personal service or as of the date of deposit of such written notice in the course of transmission in the United States Postal Service.

Section 18. Mediation

The Parties agree that, if a dispute arises between them that in any way relates to this Agreement, the terms of this Agreement, or the performance by either party under this Agreement, such dispute shall, after the claims procedures that may be applicable under the California Government Tort Claims Act are exhausted, be submitted to mediation. If such dispute proceeds to litigation, each party shall be responsible for their own attorney fees, costs and expenses. The exclusive venue for any legal action tak en pursuant to this Agreement shall be the State of California Superior Court for the County of Contra Costa or the United States District Court for the Northern District of California.

Section 19. Entire Agreement; Modifications

This Agreement constitutes the complete agreement between the Parties and supersedes any and all other agreements, either oral or in writing, between the Parties with respect to the subject matter of this Agreement. No other agreement, statement or promise relating to the subject matter of this Agreement not contained in this Agreement shall be valid or binding. This Agreement may be modified or amended only by a written document signed by representatives of both Parties with appropriate authorization.

This Agreement is executed by the Parties as of the date noted below and effective as of the Effective Date set forth above.

Approved as to Form:

48 5

By: __________________________________ Date: _______________ Christie Crowl, City Attorney

CITY OF HERCULES

By: __________________________________ Date: _______________ Chris Kelley, Mayor

INTERIM CITY MANAGER

By: __________________________________ Date: _______________ J. Patrick Tang
49 CONSENT CALENDAR

AGENDA ITEMS

6. 26-044
50 STAFF REPORT TO THE CITY COUNCIL

DATE: Regular Meeting of February 24, 2026
TO: Mayor and Members of the City Council
VIA: Dante Hall, City Manager
SUBMITTED BY: Glenn Dombeck, Public Works Director
SUBJECT: Execute a Professional Services Agreement with Kennedy & Associates, Inc. to provide Implementation Support for the Clean Water Program for Fiscal Year 2026-27
RECOMMENDED ACTION:

Adopt a Resolution authorizing the City Manager to execute a Professional Services Agreement with Kennedy & Associates , Inc. ( Kennedy) to provide Implementation Support for the Clean Water Program for Fiscal Year 2026 -27 for a Total Cost of $54,305.35.

BACKGROUND:

The Municipal Regional Stormwater National Pollution Discharge Elimination System (NPDES) Permit (MRP) administered by the San Francisco Regional Water Quality Control Board (RWQCB) under Order No. R2 -2022-0018 addresses the discharge of stormwater runoff from the municipal separate storm sewer system (MS4) for the City of Hercules and other jurisdictions throughout the Bay Area. The NPDES Permit is currently in its third iteration (MRP 3.0), with a fourth permit planned for adoption in summer 2027.

The NPDES Permit contains numerous compliance provisions addressing municipal operations, new development and redevelopment, industrial and commercial site controls, illicit discharges, construction activity and public information and outreach. It mandates trash reduction, pollution control, and green infrastructure for municipal, industrial, and construction sites to protect water quality. MRP 3.0 emphasizes stricter pollution management, aiming for 100 percent trash reduction by 2025.

51 ANALYSIS:

The City has worked with Kennedy & Associates in past years to address compliance provisions of the MRP. In 2025, the City achieved 100 percent compliance with trash reduction requirements through the installation of full trash capture devices within public right of way (ROW) and private properties located within areas of medium and high trash generation. The City also developed an asset management plan for the purposes of tracking the condition and maintenance activity of stormwater treatment assets, such as mechanical treatment devices and bioretention areas installed throughout the City.

In 2026, the City will continue to implement ongoing elements of the MRP , including ongoing monitoring and maintenance of full trash capture devices installed within th e public ROW and implementation of the asset management plan . Kennedy is facilitating training for City staff on implementation of the asset management plan. Kennedy is also assisting the City in developing an inventory of stormwater catch basins within th e City, installation of pollution prevention messages on at least 80 percent of catch basins by June 2027 and development of a plan and schedule for updating the City’s storm sewer system mapping information. Lastly, Kennedy assists the City in preparation of the annual report due in September of each year.

FISCAL IMPACT:

The FY 2025 -26 contract costs $54,305.35. Funding for this project is included in the Public Works Department’s operating budget stormwater fund account. This account is funded by a parcel assessment rate of $35.00 per Equivalent Runoff Unit (ERU), which is the rate charged to a single -family home. Hercules’ pro rata (by population) share of the regional Clean Water Program funds collected, minus the County’s administrative expenses, is returned to Hercules and deposited into the Stormwater Fund used for the local clean water activities mentioned earlier. This revenue totaled $230,621 in FY 2025-

26. The Stormwater Fund has a sufficient balance to cover the contract costs.

ATTACHMENTS:

Attach 1 – Resolution
Attach 2 – Professional Services Agreement with Kennedy & Associates, Inc.

52 HERCULES CITY COUNCIL
RESOLUTION NO. _________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES ,

CALIFORNIA, AUTHORIZING THE CITY MANAGER TO EXECUTE A
PROFESSIONAL SERVICES AGREEMENT WITH KENNEDY & ASSOCIATES, INC.

TO PROVIDE ASSISTANCE WITH THE C LEAN WATER PROGRAM FOR A TOTAL COST OF $54,305.35.

WHEREAS, under the Federal Water Pollution Control Act, prescribed discharges of storm water require a permit from the appropriate California Regional Water Quality Control Board under the Municipal Regi onal Stormwater National Pollution Discharge Elimination System (NPDES) Program (MRP); and

WHEREAS, the City of Hercules, County of Contra Costa did apply for, and did receive, an NPDES permit under San Francisco Regional Water Quality Control Board (RWQCB) Order No. R2-2022-0018 which requires the implementation of selected Best Management Practices to minimize or eliminate pollutants from entering storm waters; and

WHEREAS, The City anticipates need for Kennedy & Associate’s services to complete the implementation of the MRP provisions; and

WHEREAS, the Fiscal Year 2025-26 Adopted Budget includes a Stormwater Fund with adequate funding to support this work; and

WHEREAS, given the need to implement the MRP, it is recommended $54,305.35 of Stormwater Fund be allocated to the proposed agreement to fully fund the work.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Hercules as follows:

1. The City Council hereby authorizes the City Manager to execute a Professional Services Agreement wit h Kennedy & Associates, Inc. to provide Stormwater Services for a Total Cost of $54,305.35.

The foregoing Resolution was duly and regularly adopted at a regular meeting of the City Council of the City of Hercules held on the 24th day of February, 2026 by the following vote of the Council:

AYES:

NOES:

ABSTAIN:

ABSENT:
53 ____________________________
Chris Kelley, Mayor

ATTEST:

________________________________
Eibleis Melendez, City Clerk
54 Professional Services Agreement Agreement No.

City Attorney Approved, 03112024 FY 2025-26 Stormwater Program

Page 1 ends

CITY OF HERCULES

PROFESSIONAL SERVICES AGREEMENT

This Agreement (“ Agreement”) for professional services is made on November 18 , 2025 , between the City of Hercules, a California municipality (“City”), and Kennedy & Associates , a corporation (“Consultant”) (individually, a “Party,” and collectively, the “Parties”).

1. Scope of Services. Consultant will provide to City the professional services described in the Scope of Services, attached as Attachment A and incorporated in this Agreement (the “Services”). Only the City Council or the City Manager may authorize any change or addition to the Scope of Services specified in Attachment A.

2. Term. This Agreement will become effective on November 18, 2025 (“Effective Date”), and will terminate upon the full and satisfactory completion of the Services or as otherwise specified in Attachment A, unless terminated sooner in accordance with Section 10 of this Agreement. Time is of the essence with respect to all provisions of this Agreement that specify a time for performance.

3. Compensation. For the full and satisfactory completion of the Services, City will pay Consultant in an amount not to exceed (FIFTY-FOUR THOUSAND THREE HUNDRED FIVE DOLLARS AND THIRTY-FIVE CENTS $54,305.35), without prior written authorization by City , pursuant to the terms set forth in Attachment B on Payment, which is attached to and incorporated in this Agreement. Consultant’s compensation is intended to encompass all costs required for performing the Services, including overhead and indirect costs. Except as expressly provided in Attachment B, Consultant will not be entitled to reimbursement for expenses it incurs to provide the Services.

3.1 Payment. City will pay Consultant for Services satisfactorily provided during each calendar month within 30 days following City receipt and approval of a detailed invoice. The invoice must include, at a minimum: a description of the specific Services provided; the name of the individual providing the Services; the date(s) upon which the Services were provided; the time spent providing the Services; the amount due for the Services ; and the basis for calculating the amount due.

3.2 Additional Services. If the City requests related services beyond the Scope of Services described in Attachment A, the Consultant will provide City a written estimate for the additional services (“Additional Services”). Consultant will not provide Additional Services until Consultant has received written authorization from the City to perform the Additional Services .

Consultant will not be entitled to payment for Additional Services performed without City’s prior written authorization or for costs to correct Consultant’s errors or omissions.

4. Independent Contractor. The Parties agree that Consultant will act as an independent contractor under this Agreement and will have control of its work and the manner in which the Services are performed. Consultant is not an employee of City and is not entitled to participate in any health, retirement, or similar employee benefits from the City.

Agreement No.

55 Professional Services Agreement Agreement No.

City Attorney Approved, 03112024 FY 2025-26 Stormwater Program

Page 2 ends

5. Consultant’s Warranties.

5.1 Consultant warrants that all Services provided under this Agreement will be performed in accordance with generally accepted professional practices and standards for Consultant’s profession in the Bay Area.

5.2 Consultant warrants that all Services provided under this Agreement will be performed in accordance with applicable federal, state, and local laws and regulations, including, but not limited to, conflict of interest laws and City ordinances and policies.

5.3 Consultant warrants that Consultant has no present interest which would conflict in any manner with the performance of Services on the City’s behalf.

5.4 Consultant warrants that it will comply with the City’s Nepotism and Cronyism Policy (Hercules Municipal Code § 2-3.401 et seq.) and the City’s California Equal Pay Act Compliance Policy (Hercules Municipal Code § 2-3.501 et seq.).

6. Notice. Any notice, billing, or payment required by this Agreement must be made in writing, and sent to the other P arty by personal delivery, U.S. Mail, a reliable overnight deliv ery service, or by e mail as a PDF (or comparable) file. Notice is effective upon delivery unless otherwise specified. Notice for each Party will be given as follows:

City: Consultant:

City of Hercules Name: Kennedy & Associates 111 Civic Drive Address: 2586 Comistas Dr.

Hercules, CA 94547 Walnut Creek, CA 94598 (510) 799-8200 Phone: (925) 932-7857 Attn: City Clerk Attn: Frank Kennedy Emai : [email protected]
Copy to: Glenn Dombeck Copy to: Andrew Kennedy Email: [email protected] Email: [email protected]

7. Indemnity. Subsection 7.1 is not applicable to this Agreement if Consultant’s Services are “design professional” services as that term is used and defined in Civil Code section 2782.8.

Subsection 7.2 is applicable to this Agreement if Consultant’s Services are “design professional” services as used and defined in Civil Code section 2782.8.

7.1 T o the full extent permitted by law, Consultant will indemnify, defend with counsel acceptable to City, and hold harmless City, its governing body, officers, agents, employees, and volunteers (collectively, “City Indemnitees”) from and against any and all liability, demands, loss, damage, claims, settlements, expenses, and costs (including, without limitation, attorney fees, expert witness fees, and costs and fees of litigation) (collectively, “ Liability”) of every nature arising out of or in connection with Consultant’s acts or omissions with respect to this Agreement, except such Liability caused by the active negligence, sole negligence, or willful misconduct of any of the City Indemnitees. This indemnification obligation is not limited by any limitation on the amount or type of damages or compensation payable under Workers’ Compensation or other employee benefit acts, or by insurance coverage limits, and will survive the expiration or early termination of this Agreement. This Subsection 7.1 does not apply if the Services to be provided 56 Professional Services Agreement Agreement No.

City Attorney Approved, 03112024 FY 2025-26 Stormwater Program

Page 3 ends

under this Agreement are design professional services provided by a licensed architect, landscape architect, professional engineer, or professional land surveyor.

7.2 To the full extent permitted by law, Consultant will indemnify, defend, and hold harmless City, its City Council, officials, officers, agents, employees, and volunteers from and against any and all liability, loss, damage, claims, expenses and costs (including, without limitation, attorney fees and costs and fees of litigation) (collectively, “ Liability”) of every nature which arises out of, pertains to, or relates to the negligence, recklessness, or willful misconduct of Consultant in the performance of this Agreement, except such Liability caused by the ac tive negligence, sole negligence or willful misconduct of City. This indemnification obligation is not limited by any limitation on the amount or type of damages or compensation payable under Workers’ Compensation or other employee benefit acts, or by insurance coverage limits, and will survive the expiration or early termination of this Agreement. This Subsection 7.2 is applicable if the Services to be provided under this Agreement are design professional services provided by a licensed architect, landscape architect, professional engineer, or professional land surveyor.

8. Insurance. Before providing any Services under this Agreement, Consultant is required to procure and provide proof of the insurance coverage required by this Section in the form of certificates and endorsements. Each certificate of insurance must state that the coverage afforded by the policy or policies will not be reduced, cancelled or allowed to expire without at least 30 days written notice to City, unless due to nonpayment of premiums, in which case at least 10 days written notice will be made to City. The required insurance must cover the activities of Consultant and its employees or subcontractors relating to or arising from the performance of the S ervices, and must remain in full force and effect at all times during the term of the Agreement. All required insurance must be issued by an insurer licensed to do business in the State of California, and each such insurer must have an A.M. Best financial strength rating of “A” or better and a financial size rating of “VIII” or better. If Consultant fails to provide any of the required coverage, City may, at its sole discretion, purchase such coverage at Consultant’s expense and deduct the cost from payments due to Consultant.

8.1 The following insurance policies and limits are required for this Agreement:

8.1.1 Commercial General Liability Insurance (“CGL”) . CGL insurance issued on an occurrence basis, including coverage of liability arising from Consultant’s acts or omissions in the performance of Services under this Agreement, with limits of at least $1,000,000.00 per occurrence.

8.1.2 Automotive. Commercial automotive liability coverage for owned, non- owned and hired vehicles must provide coverage of at least $1,000,000.00 combined single limit per accident for bodily injury, death, or property damage.

8.1.3 Workers’ Compensation Insurance and Employer’s Liability. The policy must comply with the requirements of the California Workers’ Compensation Insurance and Safety Act, with limits of at least $1,000,000.00. If Consultant is self- insured, Consultant must provide its duly authorized Certificate of Permission to Self-Insure.

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8.1.4 Professional Liability. This in surance must insure against Consultant ’s errors and omissions in the provision of S ervices under this Agreement, in an amount no less than $1,000,000.00 combined single limit.

8.2 Subrogation Waiver. Each required policy must include an endorsement that the insurer agrees to waive any right of subrogation it may have against City or the City’s insurers.

8.3 The CGL policy and the automotive liability policy must include the following endorsements:

(1) The City, including its Council, officials, officers, employees, agents, volunteers and consultants (collectively, “ Additional Insured”) must be named as an additional insured for all liability arising out of the operations by or on behalf of the named insured, and the policy must protect the Additional Insured against any and all liability for personal injury, death or property damage or destruction arising directly or indirectly in the performance of the Agreement.

(2) The inclusion of more than one insured will not operate to impair the rights of one insured against another, and the coverages afforded will apply as though separate policies have been issued to each insured.

(3) The insurance provided is primary and no insurance held or owned by City will be called upon to contribute to a loss.

(4) Any umbrella or excess insurance must contain or be endorsed to contain a provision that such coverage will also apply on a primary or non-contributory basis for the benefit of City before the City’s own insurance or self -insurance will be called upon to protect it as a named insured.

9. Dispute Resolution. In the event that any dispute arises between the Parties in relation to this Agreement, the Parties agree to meet face to face as soon as possible to engage in a good faith effort to resolve the matter informally. In the event that any dispute arises between the Parties in relation to this Agreement, and the dispute is not resolved by informal discussions, the Parties agree to submit the dispute to mediation.

9.1 Either Party may give written notice to the other Party of a request to submit a dispute to mediation, and a mediation session must take place within 60 days after the date that such notice is given, or sooner if reasonably practicable. The Parties will jointly appoint a mutually acceptable mediator. The Parties further agree to share equally the costs of the mediation, except costs incurred by each Party for representation by legal counsel.

9.2 Good faith participation in mediation pursuant to this Section is a condition precedent to either Party commencing litigation in relation to the dispute.

10. Early Termination.

10.1 Termination for Convenience. City may terminate this Agreement for convenience by giving 10 calendar days written notice to Consultant. In the event City elects to terminate the Agreement without cause, it will pay Consultant for Services satisfactorily provided up to that date. 58 Professional Services Agreement Agreement No.

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10.2 Termination for Cause. If either Party breaches this Agreement by failing to timely or satisfactorily perform any of its obligations or otherwise violates the terms of this Agreement, the other Party may terminate this Agreement by giving written notice five calendar days prior to the effective date of termination, specifying the reason and the effective date of the termination.

Consultant will be entitled to payment for all Services satisfactorily provided up to the effective date of termination, except that the City may deduct from that payment the amount of costs the City incurred, if any, because of Consultant’s breach of the Agreement.

11. Work Product. City will be the sole owner of all rights to any work product in any form which has been prepared by Consultant on City ’s behalf pursuant to this Agreement, unless otherwise specified in writing by the Parties.

12. Records. Unless otherwise specified in Attachment A, C onsultant will maintain records related to this Agreement for a period of four years from expiration or termination of this Agreement, including records of the Services performed, on a daily basis if necessary.

Consultant’s accounting systems will conform to generally accepted accounting principles, and all records will provide a breakdown of total costs charged under this Agreement, including properly executed payrolls, time records, invoices, and vouchers. Consultant will permit City to inspect and examine Consultant’s books, records, accounts, and any and all data relevant to this Agreement at any reasonable time.

13. General Provisions.

13.1 Assignment and Successors. Consultant may not assign its rights or obligations under this Agreement, in part or in whole, without City’s written consent. This Agreement is binding on Consultant’s and City’s lawful heirs, successors, and permitted assigns.

13.2 Third Party Beneficiaries. There are no intended third-party beneficiaries to this Agreement.

13.3 Nondiscrimination. Consultant will not discriminate in the employment of persons under this Agreement because of race, color, ancestry, national origin, religion, sex, marital status, age, medical condition, disability, or other prohibited basis. All nondiscrimination rules or regulations required by law to be included in this Agreement are incorporated by this reference.

13.4 Restrictions on Nepotism and Cronyism . Consultant must comply with the regulations adopted by the City to avoid favoritism or discrimination in the award of contracts, as set forth in section 2 -3.401 et seq. of the City’s Municipal Code. Consultant must complete the “Contractor Acknowledgment of City of Hercules Nepotism and Cronyism Policy,” using the form attached as Attachment C to this Agreement, and submit a fully executed copy with the executed Agreement.

13.5 Compliance with the California Equal Pay Act. Consultant must comply with the regulations adopted by the City to allow for verification of Consultant compliance with the requirements of the California Equal Pay Act, as set forth in section 2-3.501 et seq. of the City’s Municipal Code. Consultant must complete the “Contractor Acknowledgment of Compliance with the California Equal Pay Act,” using the form attached as Attachment D to this Agreement, and submit a fully executed copy with the executed Agreement.
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13.6 Choice of Law and Venue. This Agreement will be governed by California law, and venue will be in the Superior Court of Contra Costa County, and no other place.

13.7 Integration. This Agreement and the documents incorporated in this Agreement constitute the final, complete, and exclusive terms of the agreement between the City and the Consultant.

13.8 Severability. If any provision of this Agreement is determined to be illegal, invalid, or unenforceable, in part or in whole, the remaining provisions of the Agreement will remain in full force and effect.

13.9 Amendment. No amendment or modification of this Agreement will be binding unless it is in a writing duly authorized and signed by the Parties to this Agreement.

13.10 Provisions Deemed Inserted. Every provision of law required to be inserted in this Agreement will be deemed to be inserted, and this Agreement will be construed and enforced as though included. If it is discovered that through mistake or otherwise that any required provision is not inserted, or not correctly inserted, this Agreement will be amended to make the insertion or correction.

13.11 Precedence. If any provision in any document attached to or incorporated in this Agreement conflicts with or is inconsistent with the provisions set forth in the body of this Agreement, the provisions set forth in the body of this Agreement will control over any such conflicting or inconsistent provisions.

13.12 Waiver. No waiver of a breach, failure of any condition, or any right or remedy contained in or granted by the provisions of this Agreement will be effective unless it is in writing and signed by the P arty waiving the breach, failure, right, or remedy. No waiver of any breach, failure, right, or remedy will be deemed a waiver of any other breach, failure, right, or remedy, whether or not similar, nor will any waiver constitute a continuing waiver unless the writing so specifies.

13.13 Force Majeure. If either Party is delayed or hindered in or prevented from the performance of any act required under this Agreement because of strikes, lockouts, inability to procure labor or materials, failure of power, riots, insurrection, war, fire or other casualty, or other reason beyond the reasonable control of the P arty delayed, excluding financial inability (“ Force Majeure Event”), performance of that act will be excused for the period during which the Force Majeure Event prevents such performance, and the period for that performance will be extended for an equivalent period. Delays or failures to perform resulting from lack of funds will not be Force Majeure Events.

13.14 Headings. The headings in this Agreement are included for convenience only and will not affect the construction or interpretation of any provision in this Agreement or any of the rights or obligations of the Parties to this Agreement.

13.15 Execution in Counterparts. This Agreement may be executed in any number of counterparts, each of which will be an original, but all of which together will constitute one instrument.
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13.16 Authorization. Each individual signing below warrants that he or she is authorized to do so by the Party that he or she represents, and that this Agreement is legally binding on that Party. If Consultant is a corporation, signatures from two officers of the corporation are required pursuant to California Corporation Code section 313.

[Signature page follows.]

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The Parties agree to this Agreement as witnessed by the signatures below:

CITY: Approved as to form:

s/_______________________________ s/__________________________________

________________________________ ___________________________________ Dante Hall, City Manager Christie Crowl, City Attorney

Date: ___________________________ Date: ______________________________

Attest:

s/_______________________________

_________________________________
Eibleis Melendez, City Clerk

Date: ___________________________

CONSULTANT: Kennedy & Associates
Business Name

s/_______________________________

_________________________________
Name/Title

Date: ____________________________

s/_______________________________

_________________________________
Name/Title

Date: ____________________________

Attachments:

SCOPE OF SERVICES
City of Hercules
FY 2025-26 Stormwater Program

Maintenance Services Agreement Agreement No.

City Attorney Approved, 03112024 Scope of Services

SCOPE OF SERVICES

The following activities are anticipated.

• General Stormwater Support

• Support of C.2 Requirements
o C.2 AR Sections: Revisit all C.2 reporting questions, confirm reported responses are current PW Practice.
o C.2 Storm Drain Inlet Marking: New requirement for FY25-26: State how many municipal-maintained storm drain inlets jurisdiction has, certify that at least 80% for legibly labeled with appropriate stormwater pollution prevent message, include photo of labeled municipality-maintained inlet. o C.2 Training: C.2 Staff training is required at least once during the permit term on the following seven topics: Stormwater pollution prevention; Appropriate BMPs for maintenance and cleanup activities; Street and Road Repair and Maintenance BMPs; Sidewalk/Plaza Maintenance and Pavement Washing; Bridge and Structure Maintenance and Graffiti Removal; Corporation Yard SWPPPs and BMPs; and Spill and discharge response and notification procedures and contacts.
 Looking back at recent ARs, no C.2 stormwater specific training had been reported in FY22-23 or FY23-24; Suggest providing stormwater specific training during FY25-26

• C.3 O&M Inspections and C.3 Support
o Regulated Project Tracking / AR data gathering: Track SWCPs, O&M Plans, O&M Agreements - keep City spreadsheet current
 ESTIMATE: Principal Engineer - assume 0.5 hours / month o C.3.h. O&M Inspections:
 Provide recommended list of projects for O&M Inspection during FY25-26 • ESTIMATE: Principal Engineer - assume 2 hours total
 Provide O&M Inspections - can combine with C.21 Assessment for this FY. See below.
• ESTIMATE: Engineering Technician / Inspector - assume 3 inspections at 1 hour / inspection
 FJK to perform assessment of bioretention devices with City staff - Fall 2025. Provide training on necessary maintenance; include landscape contractor and maintenance staff. Use new checklist to document assessment. City to perform remedial work to bring the Transit Center IMPs back into compliance
• ESTIMATE: Principal Engineer - assume 10 hours total

• Preparation of the Annual Report

• Responding to C.4 and C.5 Requirements as Needed
o ERP - Finalize update to C.4, C.5, C.6 ERP; include C.3 O&M with ERP  ESTIMATE: Principal Engineer - assume 10 hours total
63 Attachment A

SCOPE OF SERVICES
City of Hercules
FY 2025-26 Stormwater Program

Maintenance Services Agreement Agreement No.

City Attorney Approved, 03112024 Scope of Services

o WB Guidance on IDDE: Program currently reviewing recent WB Guidance on Illicit Discharge Detection & Elimination (IDDE) Programs including draft response; comments due 10/10/2025
 ESTIMATE: Principal Engineer - assume 1 hour total

• C.6 Inspections as Directed

• Represent the City at Program Committee Meetings
o Management Committee - ESTIMATE: Principal Engineer - assume monthly meetings, 2 hour duration
o Municipal Operations - ESTIMATE: Engineering Technician - assume monthly meetings, 2 hour duration

• Implementing a PLDA Program
o Develop PLDA FTC asset inventory (identify mfg/model, condition, O&M manual, O&M contract status). Start with information included in AGOL  ESTIMATE: Principal Engineer and Engineering Technician - assume 20 hours each

• Supporting C.15 Response

• Supporting the C.21 Asset Management Effort
o I nput REM inspection data (31 devices, 3 cycles), City Mechanical Device assessment data (9 devices, 1 cycle), City bioretention assessment data (x devices, 1 cycle)
 ESTIMATE: Principal Engineer - assume 15 hours total
o E valuate/document Likelihood of Failure for each device; consider K&A draft, City review/update, Consequence of Failure for each device; consider K&A draft, City review/update
 K&A to update in AMP database
 ESTIMATE: Principal Engineer - assume 5 hour total
o T rack Mechanical Device maintenance costs: Actual costs for maintenance of the City's mechanical devices are not known. For the initial AMP Inventory, an annual cost of $1,500 / device has been estimated. The City will track costs during the upcoming FY and update this cost accordingly.  ESTIMATE: Principal Engineer - assume 2 hours total
o City - maintains Mechanical Devices 1x annually, suggest Fall 2025 use new checklist to document
 K&A to assist with review / implementation of new assessment form  ESTIMATE: Principal Engineer - assume 2 hours total
o City - maintains Bioretention Devices; FJK to perform assessment of bioretention devices with City staff, Fall 2025
 P rovide training on necessary maintenance; include landscape contractor and maintenance staff; Use new checklist to document assessment; City to perform remedial to bring the Transit Center IMPs back into compliance
64 Attachment A

SCOPE OF SERVICES
City of Hercules
FY 2025-26 Stormwater Program

Maintenance Services Agreement Agreement No.

City Attorney Approved, 03112024 Scope of Services

 ESTIMATE: PRIMARILY COVERED IN C.3 ABOVE Principal Engineer - assume 2 hours total
o Update to include:
 A ny new City-owned / maintained assets
 A ll implementation documentation
 ESTIMATE: Principal Engineer - assume 10 hours total
o AMP vs AGOL - Reconcile as necessary
 ESTIMATE: Principal Engineer and Engineering Technicial - assume 10 hours total each

• Implementation of the Green Infrastructure Plan
o Green Infrastructure - Finalize calculation for JMP Bioretention Area (to allow design to proceed). Note: Hercules MRP 3 Provision C.3.j Retrofit Assignment (acres): 1.58
 ESTIMATE: Principal Engineer - assume 5 hours total

• Other tasks as assigned
o Unfunded Mandate
 ESTIMATE: Principal Engineer - assume 2 hours total
o General MRP Compliance - General reminders, research, info sharing  ESTIMATE: Principal Engineer - assume 2 hour each month o Annual Report - FY25-26 Annual Report
65 Attachment B

PAYMENT
City of Hercules
FY 2025-26 Stormwater Program

Maintenance Services Agreement Agreement No.

City Attorney Approved, 03112024 Payment

PAYMENT

The budget for the services identified in Exhibit A is $54,305.35.

Services will be billed for actual time spent based on the rates listed below.

66 CONSENT CALENDAR

AGENDA ITEMS

7. 26-052
67 STAFF REPORT TO THE CITY COUNCIL

DATE: Regular Meeting of February 24, 2026

TO: Mayor and Members of the City Council

VIA: Dante Hall, City Manager

SUBMITTED BY: Tim Rood, Community Development Director

SUBJECT: “Shop Hercules” Yiftee Gift Card program

RECOMMENDED ACTION:

Adopt a resolution approving a fourth amendment to an agreement with Yiftee in the amount of $25,000 for the “ Shop Hercules” digital gift card incentive program, and amending the FY 25-26 budget, increasing its appropriation by $25,000.

BACKGROUND:

Following the Covid-19 pandemic, the City implemented a Yiftee Community Digital Gift Card program as a way to stimulate the local economy and assist small businesses in recovery. The program provides bonus cards that yield additional savings to card purchasers who shop locally. To date, the City has matched each card purchase with a free gift card of equal amount. The City Council allocated Yiftee funding in the amounts of $65,000 in July 2022, $75,000 in March 2023, and $25,000 in November 2023.

Yiftee gift cards are virtual credit cards that are ordered and paid for online and emailed to the buyer as a PDF. To redeem the cards, users present merchants with their Yiftee credit card number, expiration date, and 3 -digit authorization code, and the merchant types all this information into their Point -of-Sale device. Users can view their remaining card balance online. Transactions that exceed the remaining card balance are declined, which can make it difficult to redeem the full card balance unless the user knows the exact balance remaining and can persuade the merchant to split their purchase into two credit card transactions. In June 2025, Yiftee began implementing tap-to-pay (allowing users to 68 load their virtual cards into Apple Pay or Google Wallet), making it considerably easier to use for both merchants and customers.

ANALYSIS:

FISCAL IMPACT:

The Mid-Year Budget Update on tonight’s agenda includes a $25,000 appropriation from the General Fund for this purpose. The resolution amending the Yiftee agreement (Attachment 1) includes a provision making the Yiftee funding contingent upon the Council’s appropriation of the funds.

Contract Agreement No. Approval
Contract
Approval Date
Authorized
Amount
Original Contract 22-012 Council Resolution #22-032 4/26/2022 $ 65,000 1st Amendment Council Resolution #23-010 2/28/2023 $ 75,000 2nd Amendment Council Resolution #23-032 6/13/2023 $ 50,000 3rd Amendment Council Resolution #23-062 11/14/2023 $ 25,000 4th Amendment $ 25,000
Total $ 240,000

ATTACHMENTS

1. Resolution

2. Draft Amendment No. 4 to the Original Agreement

3. Original Agreement

4. Amendment No. 1 to Original Agreement

5. Amendment No. 2 to Original Agreement

6. Amendment No. 3 to Original Agreement
69 1

RESOLUTION NO. 23-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES APPROVING

A FOURTH AMENDMENT TO AN AGREEMENT WITH YIFTEE IN THE AMOUNT OF $25,000 FOR THE “SHOP HERCULES” DIGITAL GIFT CARD INCENTIVE PROGRAM

WHEREAS, the City of Hercules values its locally owned small businesses and seeks to improve the economic climate for small businesses; and

WHEREAS, the City entered into an Agreement with Yiftee for the Shop Local/Gift Card Program on April 26, 2022 for $65,000; and

WHEREAS, due to successful launch of the pilot program, the City Council approved the First Amendment to the Agreement, adding $75,000 to the program and increasing the budget by $75,000; and

WHEREAS, to encourage large employers in the vicinity of Hercules to patronize Hercules restaurants and caterers, the City Council approved the Second Amendment to the Agreement, adding $50,000 to the program and increasing the budget by $50,000; and

WHEREAS, in recognition of Small Business Saturday in 2023, the City Council approved the Third Amendment to the Agreement, adding $25,000 to the program and increasing the budget by $25,000; and

WHEREAS, the Fourth Amendment would add $25,000 to the Yiftee Gift Card program; and

WHEREAS, the FY 25 -26 Mid-Year Budget Update includes a $25,000 appropriation from the General Fund for this purpose;

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Hercules as follows:

1. Provided the City Council approves the proposed $25,000 appropriation from the General Fund included in the FY 25 -26 Mid -Year Budget Update, t he Fourth Amendment to the Agreement with Yiftee is hereby approved , and the City Manager is authorized to execute the Fourth Amendment to the agreement.

2. Yiftee funding from the Fourth Amendment is to be released in $5,000 increments at quarterly intervals, with a 25% bonus on gift card purchases, a maximum card value of $200, and a maximum of 1 card purchase per user per quarter.

70 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 24th day of February 2026 by the following vote of the Council:

AYES:

NOES:

ABSTAIN:

ABSENT:

____________________________
Chris Kelley, Mayor

ATTEST:

Eibleis Melendez, City Clerk
71 Original Agreement No. 22-012
Yiftee for a Shop Local/Gift Card Program
AMENDMENT NO. 4

Approving Revised Attachment B to add an additional $25,000

1. Parties. The parties to this Contract Amendment are the City of Hercules, a public body corporate and the following named Contractor:

Yiftee
325 Sharon Park Drive #215, Menlo Park, CA 94025
(650) 533-0938
Attention: Donna Novitsky
[email protected]

The parties to this Contract Amendment (“Amendment No. 4”) do mutually agree and promise as follows:

2. Purpose. This Amendment No. 4 is being entered into to amend an existing contract between the City and Contractor which was approved by the City Council of the City of Hercules on April 26, 2022, by Resolution No. 22-032. Said contract shall hereinafter be referred to as the "Original Contract" and is incorporated herein by reference. The Original Contract was amended by Amendment No. 1 on February 28, 2023, by Resolution No. 23-010; amended by Amendment No. 2 on June 13, 2023 , by Resolution No. 23 -032; and amended by Amendment No. 3 on November 14, 2023, by Resolution No. 23-062.

3. Original Contract Provisions. The parties hereto agree to continue to abide by those terms and conditions of the Original Contract, and any and all amendments thereto, which are unaffected by this Amendment No. 4.

4. Amendment. This Amendm ent No. 4 is intended to amend the Original Contract and previously approved amendments (collectively, the "Amended Contract") thereto to provide for additional compensation in an amount not to exceed $ 25,000, for a total contract amount of $240,000.

5. Amendment Approval: This Amendment No. 4 was approved by the City Council of the City of Hercules on the 24th day of February, 2026.

6. Signatures. These signatures attest the parties' agreement hereto:

City of Hercules

s/_______________________________
Dante Hall, City Manager

Date: ___________________________

Approved as to form:

By ______________________________
Christine Crowl, City Attorney
Contractor: Yiftee

s/_______________________________

_________________________________
Name/Title

Date: ___________________________

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Professional Services Agreement Agreement No. <22-012> Contract Version 082321 City Attorney Approved Edits 051722 Resolution No. <22-032> Community Card ARPA Program

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CITY OF HERCULES

PROFESSIONAL SERVICES AGREEMENT

This Agreement (“Agreement”) for professional services is made on April 26, 2022, between the City of Hercules , a California municipality (“City”), and Yiftee , a California Community Card Program Corporation (“Consultant”) (individually, a “Party,” and collectively, the “Parties”).

2. Term. This Agreement will become effective on April 26, 2022 (“Effective Date”), and shall continue in full force for one year from the Effective Date. At the sole discretion of the City, the Agreement may be renewed for an additional option year, up to a maximum of four option years, and with no option period allowed beyond December 31, 2026.

3. Compensation. For the full and satisfactory completion of the Services, City will pay Consultant in an amount not to exceed Sixty Five Thousand Dollars ( $65,000), without prior written authorization by City, pursuant to the terms set forth in Attachment B on Payment, which is attached to and incorporated in this Agreement. Consultant’s compensation is intended to encompass all costs required for performing the Services, including overhead and indirect costs.

Except as expressly provided in Attachment B, Consultant will not be entitled to reimbursement for expenses it incurs to provide the Services.

3.1 Payment. City will pay Consultant for Services satisfactorily provided during each calendar month within 30 days following City receipt and approval of a detailed invoice. The invoice must include, at a minimum: a description of the specific Services provided; the date(s) upon which the Services were provided; the amount due for the Services ; and the basis for calculating the amount due. Payment for gifts and fees must be received before the gifts can be delivered.

Consultant will not be entitled to payment for Additional Services performed without City’s prior written authorization or for costs to correct Consultant’s errors or omissions.

Agreement No. 22-012
Council Resolution No. 22-032
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5. Consultant’s Warranties.

5.3 Consultant warrants that Consultant has no present interest which would conflict in any manner with the performance of Services on the City’s behalf.

5.4 Consultant warrants that it will comply with the City’s Nepotism and Cronyism Policy.

City: Consultant:

City of Hercules Yiftee
111 Civic Drive 325 Sharon Park Drive # 215
Hercules, CA 94547 Menlo Park, CA 94025
(510) 799-8200 (650) 533-0938
Attn: City Clerk Attn: Donna Novitsky
[email protected]
Copy to: _____________________ Copy to: _____________________ Email: _______________________ Email: _______________________

7. Indemnity. Subsection 7.1 is not applicable to this Agreement if Consultant’s Services are “design professional” services as that term is used and defined in Civil Code section 2782.8.

Subsection 7.2 is applicable to this Agreement if Consultant’s Services are “design professional” services as used and defined in Civil Code section 2782.8.

7.1 T o the full extent permitted by law, Consultant will indemnify, defend with counsel acceptable to City, such acceptance to not be unreasonably withheld and hold harmless City, its governing body, officers, agents, employees, and volunteers (collectively, “City Indemnitees”) from and against any and all liability, demands, loss, damage, claims, settlements, expenses, and costs (including, without limitation, attorney fees, expert witness fees, and costs and fees of litigation) (collectively, “Liability”) of every nature arising out of or in connection with Consultant’s negligent acts or omissions with respect to this Agreement, except such Liability caused by the active negligence, sole negligence, or willful misconduct of any of the City Indemnitees. This indemnification obligation is not limited by any limitation on the amount or type of damages or compensation payable under Workers’ Compensation or other employee benefit acts, or by insurance coverage limits, and will survive the expiration or early termination of this Agreement.

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This Subsection 7.1 does not apply if the Services to be provided under this Agreement are design professional services provided by a licensed architect, landscape architect, professional engineer, or professional land surveyor.

7.2 To the full extent permitted by law, Consultant will indemnify, defend, and hold harmless City, its City Council, officials, officers, agents, employees, and volunteers from and against any and all liability, loss, damage, claims, expenses and costs (including, without limitation, attorney fees and costs and fees of litigation) (collectively, “Liability”) of every nature which arises out of, pertains to, or relates to the negligence, recklessness, or willful misconduct of Consultant in the performance of this Agreement, except such Liability caused by the active negligence, sole negligence or willful misconduct of City. This indemnification obligation is not limited by any limitation on the amount or type of damages or compensation payable under Workers’ Compensation or other employee benefit acts, or by insurance coverage limits, and will survive the expiration or early termination of this Agreement. This Subsection 7.2 is applicable if the Services to be provided under this Agreement are design professional services provided by a licensed architect, landscape architect, professional engineer, or professional land surveyor.

8.1 The following insurance policies and limits are required for this Agreement:

8.1.2 [Blank]

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8.2 Subrogation Waiver. Each required policy must include an endorsement that the insurer agrees to waive any right of subrogation it may have against City or the City’s insurers.

8.3 The CGL policy and the automotive liability policy must include the following endorsements:

(3) The insurance provided is primary and no insurance held or owned by City will be called upon to contribute to a loss.

9.2 Good faith participation in mediation pursuant to this Section is a condition precedent to either Party commencing litigation in relation to the dispute.

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10. Early Termination.

11. Records. Unless otherwise specified in Attachment A, C onsultant will maintain records related to this Agreement for a period of four years from expiration or termination of this Agreement, including records of the Services performed, on a daily basis if necessary.

12. General Provisions.

12.1 Assignment and Successors. Consultant may not assign its rights or obligations under this Agreement, in part or in whole, without City’s written consent, such consent to not be unreasonably withheld . This Agreement is binding on Con sultant’s and City’s lawful heirs, successors, and permitted assigns.

12.2 Third Party Beneficiaries. There are no intended third-party beneficiaries to this Agreement.

12.3 Nondiscrimination. Consultant will not discriminate in the employment of persons under this Agreement because of race, color, ancestry, national origin, religion, sex, marital status, age, medical condition, disability, or other prohibited basis. All nondiscrimination rules or regulations required by law to be included in this Agreement are incorporated by this reference.

12.3.1 Avoidance of Cronyism and Nepotism. Consultant shall comply with regulations adopted by the City of Hercules to avoid favoritism in the award of contracts. Consultant shall submit a fully executed copy of the “Contractor Acknowledgment of City of Hercules Nepotism and Cronyism Policy” as Attachment C to this Agreement.

12.3.2 Compliance with the California Equal Pay Act . Consultant shall comply with regulations adopted by the City of Hercules to allow for verification of Consultant compliance with the requirements of the California Equal Pay Act. Consultant shall submit a fully executed copy of DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 78 Professional Services Agreement Agreement No. <22-012> Contract Version 082321 City Attorney Approved Edits 051722 Resolution No. <22-032> Community Card ARPA Program

Page 6 ends

the “Contractor Acknowledgment of Compliance with the California Equal Pay Act” as Attachment D to this Agreement.

12.4 Choice of Law and Venue. This Agreement will be governed by California law, and venue will be in the Superior Court of Contra Costa County, and no other place.

12.5 Integration. This Agreement and the documents incorporated in this Agreement constitute the final, complete, and exclusive terms of the agreement between the City and the Consultant.

12.6 Severability. If any provision of this Agreement is determined to be illegal, invalid, or unenforceable, in part or in whole, the remaining provisions of the Agreement will remain in full force and effect.

12.7 Amendment. No amendment or modification of this Agreement will be binding unless it is in a writing duly authorized and signed by the Parties to this Agreement.

12.8 Provisions Deemed Inserted. Every provision of law required to be inserted in this Agreement will be deemed to be inserted, and this Agreement will be construed and enforced as though included. If it is discovered that through mistake or otherwise that any required provision is not inserted, or not correctly inserted, this Agreement will be amended to make the insertion or correction.

12.9 Precedence. If any provision in any document attached to or incorporated in this Agreement conflicts with or is inconsistent with the provisions set forth in the body of this Agreement, the provisions set forth in the body of this Agreement will control over any s uch conflicting or inconsistent provisions.

12.10 Waiver. No waiver of a breach, failure of any condition, or any right or remedy contained in or granted by the provisions of this Agreement will be effective unless it is in writing and signed by the P arty waiving the breach, failure, right, or remedy. No waiver o f any breach, failure, right, or remedy will be deemed a waiver of any other breach, failure, right, or remedy, whether or not similar, nor will any waiver constitute a continuing waiver unless the writing so specifies.

12.11 Force Majeure. If either Party is delayed or hindered in or prevented from the performance of any act required under this Agreement because of strikes, lockouts, inability to procure labor or materials, failure of power, riots, insurrection, war, fire or other casualty, or other reason beyond the reasonable control of the P arty delayed, excluding financial inability (“Force Majeure Event”), performance of that act will be excused for the period during which the Force Majeure Event prevents such performance, and the period for that performance will be extended for an equivalent period. Delays or failures to perform resulting from lack of funds will not be Force Majeure Events.

12.12 Headings. The headings in this Agreement are included for convenience only and will not affect the construction or interpretation of any provision in this Agreement or any of the rights or obligations of the Parties to this Agreement.

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 79 Professional Services Agreement Agreement No. <22-012> Contract Version 082321 City Attorney Approved Edits 051722 Resolution No. <22-032> Community Card ARPA Program

Page 7 ends

12.13 Execution in Counterparts. This Agreement may be executed in any number of counterparts, each of which will be an original, but all of which together will constitute one instrument.

12.14 Authorization. Each individual signing below warrants that he or she is authorized to do so by the Party that he or she represents, and that this Agreement is legally binding on that Party. If Consultant is a corporation, signatures from two officers of the corporation are required pursuant to California Corporation Code section 313.

[Signature page follows.]

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 80 Professional Services Agreement Agreement No. <22-012> Contract Version 082321 City Attorney Approved Edits 051722 Resolution No. <22-032> Community Card ARPA Program

Page 8 ends

The Parties agree to this Agreement as witnessed by the signatures below:

CITY: Approved as to form:

s/_______________________________ s/__________________________________

________________________________ ___________________________________ Dante Hall, City Manager Patrick Tang, City Attorney

Date: ___________________________ Date: ______________________________

Attest:

s/_______________________________

_________________________________
Name/Title

Date: ___________________________

CONSULTANT: Yiftee
Business Name

s/_______________________________

_________________________________
Name/Title

Date: ____________________________

s/_______________________________

_________________________________
Name/Title

Date: ____________________________

Attachments:

Attachment A: Scope of Services
Attachment B: Payment
Attachment C: Contractor Acknowledgment of City of Hercules Nepotism and Cronyism Policy Attachment D: Contractor Acknowledgment of Compliance with the California Equal Pay Ac DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 6/9/20226/22/2022
Ceo, Yiftee
6/9/2022
Donna Novitsky
6/22/2022
Lauren Berges
City Clerk / Public Information Officer
81 Professional Services Agreement Agreement No. <22-012> City Attorney Approved, 082321 Scope of Services

Attachment A

SCOPE OF SERVICES

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 82 Community Card Customer Agreement

THIS AGREEMENT (the “Agreement”) is made effective as of __________, 2022 (the “Effective Date”) by and between Yiftee Inc., a Delaware corporation, with an address at 325 Sharon Park Drive #215, Menlo Park, CA 94025 (“Yiftee”) and _____________________________________ with an address at _________________________________________(“Customer”). The parties agree a follows:

1. Definitions.

1.1 “Merchant” means a merchant, prospect or other contact that may be using or desire to use Yiftee Services to redeem eGifts.

1.2 “Participant” means a Merchant who has opted to participate in a Community Card by running an Activation Card and agreeing to the Merchant Agreement.

1.3 “Yiftee Services” means Yiftee’s gift-giving platform. It is the technology foundation for Community Cards.

1.4 “Purchaser” means a person or entity that purchases or redeems eGifts.

1.5 “eGift” means a digital virtual gift voucher used as payment for goods or services at a Participant.

1.6 “Offer” or “Offers” mean specific benefits that Participants provide to consumers who use their Community Cards in their store, as determined by the Participants and posted on their eGift Card web page.

2. Merchant Enrollment.

2.1 Merchant Enrollment Obligations
(a) Customer will collect a set of Merchants who have elected to participate in the Yiftee Services.

Merchants must all be located in the same state in the USA, due to varying gift card laws by state. Each Merchant must agree to the Yiftee Community Card Merchant Agreement located on the Yiftee.com website. Merchants who have not agreed to the Merchant Agreement will not be able to utilize the Yiftee Services to redeem eGifts. Customer will upload into the Yiftee Services or provide the names of the Merchants who intend to participate to Yiftee. Upon the agreed upon launch date, the billing for the Yiftee Services will begin (“Commencement Date”). This billing will include the agreed-upon cost for each Participant or group thereof as defined in Appendix A. (b) Yiftee will provide to Customer or directly to Merchants, upon receipt of the set of Merchant names in 2.1a, a set of unique Activation Cards to be run by each Merchant. Customer will inform Merchants of their individual Activation Card and provide instructions on its use. Additionally, Customer will inform Merchants that running the Activation Card implies consent to the Merchant Agreement located on the Yiftee.com website.
(c) As Merchants run the Activation Cards, they will be included in the set of Merchants enabled to participate in the Yiftee Services, i.e. the Participants. Participant may also post their Offers to be available for eGift Card holders who redeem gifts in their stores.

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 83 (d) Yiftee will bill Customer or Merchants as described in Appendix A. Customer can add or remove Participants and fees will be adjusted accordingly, if applicable. There will be no retroactive adjustments allowed by Yiftee (that is, a cancelled Participant’s billing obligation will result in that Participant’s cost to Customer, as defined in Appendix A, to be eliminated beginning only on the next annual billing cycle).

A Participant may be added to the list of Participants at any time (“Enrollment Time”), with billing adjustment for said Participant to begin immediately and to be included in the current month’s billing. (e) Each party shall comply with good, ethical and moral business practices and all applicable laws and regulations in engaging in any activities here under.
(f) Fees and payment terms applicable to the subject matter here under shall be as set forth in Appendix A. Customer is not entitled to compensation other than what is described in Appendix A. (g) Customer is responsible and liable for any disputes or liability arising out of its relationships with Merchants and Participants, except with respect to any liability of Yiftee under this agreement.

2.2 Yiftee Materials.

Yiftee may provide Customer with certain materials for use in conjunction with promoting the Yiftee Services here under (“Yiftee Materials”). No rights or licenses, express or implied, are granted in those Yiftee Materials or otherwise, except as expressly and unambiguously set forth in this Agreement.

2.3 Limited Licenses.

Subject to the terms and conditions of this Agreement, Yiftee hereby grants to Customer, a non- exclusive, non-transferable, non-assignable, non-sublicensable right and license to access and use the Yiftee Services and Yiftee Materials solely for the purposes of Customer’s performance of this Agreement.

2.4 Trademark License.

Subject to the terms and conditions of this Agreement, Yiftee hereby grants Customer and Customer hereby grants Yiftee a non-exclusive, non-transferable, non-assignable, non-sublicensable, royalty-free license to use Yiftee’s or Customer’s name, trade names, trademarks, service marks, and logos (collectively, a party’s “Marks”) solely in connection with Customer’s and Yiftee’s promotion and marketing of the Yiftee Services, subject to written usage guidelines, if any, made mutually available.

3. Ownership. As between the parties, Yiftee owns all right, title and interest in and to the Yiftee Services, Yiftee’s Marks and the Yiftee Materials. Customer owns all right, title and interest in and to Customer’s Marks.

4. Warranties Disclaimer. YIFTEE AND ITS LICENSORS MAKE NO WARRANTIES TO CUSTOMER,

EXPRESS OR IMPLIED, AND SPECIFICALLY DISCLAIM ALL IMPLIED WARRANTIES OF MERCHANTABILITY,

NONINFRINGEMENT, AND FITNESS FOR A PARTICULAR PURPOSE, AND ALL WARRANTIES ARISING OUT OF USAGE OR TRADE, COURSE OF DEALING AND COURSE OF PERFORMANCE.

5. Liability Limitation. EXCEPT FOR LIABILITY ARISING UNDER SECTION 7, NEITHER PARTY (NOR ITS

LICENSORS) WILL BE LIABLE OR OBLIGATED WITH RESPECT TO ANY SUBJECT MATTER OF THIS

AGREEMENT OR UNDER ANY CONTRACT, TORT, STRICT LIABILITY OR OTHER LEGAL OR EQUITABLE

THEORY, WHETHER OR NOT ADVISED OF THE POSSIBILITY OF SUCH DAMAGES WHATSOEVER, FOR ANY

SPECIAL, INDIRECT, INCIDENTAL, EXEMPLARY, PUNITIVE, RELIANCE OR CONSEQUENTIAL DAMAGES, INCLUDING LOSS OF PROFITS, REVENUE, DATA OR USE AND IN NO EVENT SHALL EITHER PARTY’S DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 84 LIABILITY EXCEED THE GREATER OF $500 OR THE AMOUNTS PAID AND/OR PAYABLE BY YIFTEE TO

CUSTOMER (AND/OR BY CUSTOMER TO YIFTEE, IF PAYMENTS ARE PAYABLE BY CUSTOMER TO YIFTEE IN ACCORDANCE WITH PROPOSAL) HEREUNDER IN THE TWELVE (12) MONTH PERIOD PRECEDING THE APPLICABLE CLAIM.

6. Term and Termination.

6.1 Term. This Agreement shall be effective as of the Effective Date and shall continue in full force on an annual period from the Effective Date, and thereafter shall automatically renew annually, unless and until either party terminates this Agreement pursuant to Section 6.2.

6.2 Termination.
(a) Either party may, at its option, terminate this Agreement upon thirty (30) days written notice to the other party for any reason or for no reason whatsoever. (b) Either party may terminate this Agreement if the other party materially breaches a term of this Agreement and fails to cure such breach within fifteen (15) days after receipt of written notice of such breach from the non-breaching party.
(c) Participants are obligated to honor all outstanding eGifts issued by Yiftee for the entire duration of those eGift's validity periods. Termination does not relieve Participants from honoring conditions outlined in the Merchant Agreement.

6.3 Effect of Termination. Upon any termination: (a) Customer shall immediately cease all promotion of the Yiftee Services and shall immediately return to Yiftee, or at the option of Yiftee, destroy, all Confidential Information (as defined below) of Yiftee disclosed to Customer, Yiftee Materials, and any Yiftee Services, hardware and software provided to Customer here under, (b) Yiftee shall immediately return to Customer, or at the option of Customer, destroy, all Confidential Information of Customer disclosed to Yiftee here under, and (c) all licenses granted under this Agreement shall immediately cease. The following Sections shall survive termination and remain in effect 1, 3, 4, 5, 6.3, 7 and 8. Any termination of this Agreement shall be without prejudice to any other rights or remedies available under this Agreement or at law.

7. Confidentiality. Because of this Agreement, the parties may have access to information that is confidential to the disclosing party (“Confidential Information”). Confidential Information shall include, without limitation, Purchaser lists and information relating to the parties’ products and pricing and all information designated as confidential by the disclosing party at the time of disclosure. A party’s Confidential Information shall not include any information which (i) becomes generally publicly available through no wrongful act or omission of the receiving party; (ii) is lawfully acquired by the receiving party from a third party without any breach of a confidentiality obligation; or (iii) is independently developed without use of or reference to the disclosing party’s Confidential Information. Each party agrees to maintain the confidentiality of the other party’s Confidential Information using the same degree of care that it uses with regard to its confidential information of like nature, but in no event less than reasonable care, and to protect as a trade secret any portion of the other party’s Confidential Information by preventing any unauthorized copying, use, distribution, installation or transfer of possession of such information. If required by law, the receiving party may disclose Confidential Information of the disclosing party, but will give adequate prior notice of such disclosure to the disclosing party to permit the disclosing party to intervene and to request protective orders or other confidential treatment therefor. The parties acknowledge that money damages will not be an adequate DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 85 remedy if this Section 7 is breached and, therefore, either party may, in addition to any other legal or equitable remedies, seek an injunction or other equitable relief against such breach or threatened breach without the necessity of posting any bond or surety.

8. Non-solicitation
During the term of this Agreement, neither party will (on behalf of itself or any other person or entity) solicit any Purchaser or Merchant of the other party to restrict, limit, or terminate such Purchaser’s or Merchant’s participation in the other party’s products and services.

9. Miscellaneous

9.1 Choice of Law. This contract shall be governed by and construed in accordance with the laws of the State of California, without regard to the provisions of the conflict of laws thereof. The parties will resolve any disputes in the state or federal courts located in Santa Clara County, California, to whose exclusive jurisdiction and venue they irrevocably submit. Notwithstanding anything to the contrary, either party may pursue injunctive or other equitable relief in any court of competent jurisdiction.

9.2 Notices. Any notice or other communication required or permitted in this Agreement shall be in writing and shall be deemed to have been duly given on the day of service if served personally or by facsimile transmission with confirmation, or three (3) days after mailing if mailed by First Class mail, registered or certified, postage prepaid, and addressed to the respective parties at the addresses set forth above, or at such other addresses as may be specified by either party pursuant to the terms and provisions of this section.

9.3 Assignment. Customer may not assign or otherwise transfer, without the prior written consent of Yiftee, its rights, duties or obligations under this Agreement to any person or entity, in whole or in part. Yiftee may freely assign or otherwise transfer this Agreement in connection with the sale of all or substantially all of its business or assets. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

9.4 Severability. Any provision of this Agreement that is determined to be unenforceable or unlawful shall not affect the remainder of the Agreement and shall be severable therefrom, and the unenforceable or unlawful provision shall be limited or eliminated to the minimum extent necessary to that this Agreement shall otherwise remain in full force and effect and enforceable.

9.5 Entire Agreement. This Agreement constitutes the entire agreement between the parties and supersedes any and all prior agreements between them, whether written or oral, with respect to the subject matter hereof, and may not be amended, modified or provision hereof waived, except in a writing signed by the parties hereto. No waiver by either party, whether express or implied, of any provision of this Agreement, or of any breach thereof, shall constitute a continuing waiver of such provision or a breach or waiver of any other provision of this Agreement.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the Effective Date.

Customer (Print): YIFTEE, INC.

By: By:

Name, Title: Name, Title: Donna Novitsky, Yiftee CEO DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 86 Professional Services Agreement Agreement No. <22-012> City Attorney Approved, 082321 Payment

Attachment B

PAYMENT

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 87 Community Card Customer Agreement

APPENDIX A
Pricing

Customer and Participants are not required to pay Yiftee a subscription fee or a revenue share. Yiftee does not take a percentage of the cards that are redeemed in the Participants’ stores.

Charges:

Purchasers pay the face value of the card plus a $1+5% of the eGift Card value eDelivery fee at the time of purchase. Bulk purchases of one thousand dollars ($1000) or more, and enterprise accounts may qualify for a reduced eDelivery fee by depositing funds into their Yiftee eGifting accounts by check or ACH and disabling credit cards.

Participants pay Mastercard processing fees for a card-not-present (CNP) transaction upon redemption.

Yiftee does not control these fees, they are set by the Merchant Acquirer who is their credit card processor.

Subject to applicable laws, Yiftee will implement a monthly maintenance fee on eGift Cards that have been inactive (i.e. no spending on the Card) for periods of greater than 12 months. This will be made clear to cardholders on the face of the eGift Card when implemented, as is required by law.

Yiftee eGift Cards do not generally expire. Subject to applicable laws, in some cases eGift Cards given by corporations or merchants as promotions, rewards and awards may have expiration dates. In the case of eGift Cards expiring, Yiftee retains 10% of the original eGift Card value not to exceed the remaining unspent funds and refunds the balance to the purchaser’s Yiftee eGift Card account. eDelivery fees are not refunded.

Participants may choose, at their discretion, to post Offers to encourage Purchasers to use their Community Cards in their stores.

Participants may choose, at their discretion, to offer rebates as fund raisers to local groups such as schools, churches and other non-profits. Such programs are an incentive for the local groups to sell Community Cards to their members, and for the Purchasers to use them in specific stores who are offering rebates. Yiftee will work with the Participants and Purchasers to execute such programs.

No tipping is allowed on Yiftee eGift Cards.

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 88 ORDINANCE NO. 486

AN ORDINANCE OF THE CITY OF HERC ULES ESTABLISHING POLICIES TO

ADDRESS AND PREVENT NEPOTISM A ND CRONYISM IN CITY EMPLOYMENT

AND CONTRACTING

WHEREAS, to promote and maintain confidence in City government, it is imperative that City employment and contracting are free from nepotism, cronyism, patronage, and favoritism; and

WHEREAS, it is imperative that City employment and City contracts be based on merit, so that citizens are assured that City employees will be providing the highest quality service to those deserving citizens; and

WHEREAS, nepotism, cronyism, patronage, a nd favoritism are demoralizing and dispiriting to the dedicated, hard-working employees of the City; and

WHEREAS, the hiring of city officials, contra ctors and consultants who have a family, business, or consensual romantic and/or sexual relationship with a City official creates the appearance of impropriety and should be discouraged.

NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Hercules as follows:

1. The Hercules Municipal Code is hereby amended to include Title 2, Chapter 3, Article 4, to read as follows:

“Article 4. PREVENTION OF NEPOTISM AND CRONYISM IN

EMPLOYMENT AND CONTRACTING

Sec. 2-3.401 Purpose

In adopting this Article, it is the intent of the City Council to prohibit the contracting with, and employment of, relatives and friends of C ity Officials, to ensure that no conflict of interest, favoritism, preferential treatment, or discrimination enters into the hiring, promotion, contracting and/or transfer practices of the City.

The regulations established by th is Article shall apply to all City officials, as defined herein, and to all individuals or firms who pr ovide services to the City as independent contractors or paid consultants.

Sec. 2-3.402 Definitions

“City” as used herein shall mean the City of Hercules, California.

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 89 “City Official s” for the purposes of this Article means City Elected Officials, City Appointed Officials, appointees to City ad hoc or standing committees, appointees to City Commissions, and City Employees, including all individuals who are employed by the City Manager, City Attorney, and City Clerk, as well as all employees of City Agencies and Departments.

“Contractor” means any individual or firm providing material, equipment, or services to the City pursuant to a written or oral agreement with the City as an independent contractor or consultant,
and not as an employee.

"Family Relationship" means a relationship by blood, adoption, marriage, domestic partnership, foster care, and cohabitation, and includes parents, grandparents, great- grandparents, grandchildren, great-grandchildren, children, foster children, uncles, aunts, nephews, nieces, first cousins, second cousins, siblings, and the spouses or domestic
partners of each of these relatives and cohabitants. This definition includes any relationship that exists by virtue of marriage or domestic partnership, such as in-law and step relationships, which are covered to the same extent as blood relationships.

"Consensual Romantic and/or Sexual Relationship" means any consensual romantic and/or sexual relationship between a City official or Contractor and any City official who may supervise
him or her directly or indirectly, or who may influence the terms and conditions of his or her employment or contract with the City.

“Cronyism” means making an employment or contracting decision based upon personal, political, financial,
or commercial relationships instead of merit when the person or entity benefitting from the employment, promotion, supervision or contract does not have the qualifications for the position or contract, or is being compensated at a rate that is more than the rate that would be paid other employees or contractors performing the same or similar functions.

“Nepotism” means employing, promoting, supervising or contracting with a person or persons who have a family relationship or a consensual romantic and/or sexual relationship with a
City official.

Sec. 2-3.403 Restricting Nepotism and Cronyism in Public Employment.

(a). Statement of Policy.

It is the policy of the City of Hercules to hire, promote, and transfer employees on the basis of individual merit and to avoid favoritism or discrimination in making such decisions.

The employment of relatives of City officials, in positions where one might have influence over the other’s status or job security, is regarded as a violation of this Section.

Nepotism
and cronyism, as defined in Section 2-3.402 , are prohibited from City employment decisions to the full extent permitted by law.

It is therefore the City ’s policy to prohibit nepotism and cronyism in public employment according to the guidelines below:

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 90 (1) An individual will not be hired, promoted, transferred, or otherwise placed into a position when a person with whom the individual has a family relationship or consensual romantic and/or sexual relationship occupies a position in his or her direct supervisory chain of command.

(2) Individuals will not be hired, promoted, transferred, or otherwise placed into a position when to do so would constitute cronyism.

(3) Department Heads are prohibited from employing or supervising any person with whom the Department Head has a family relationship or consensual romantic and/or sexual relationship within his/her department in any capacity in which that
person may receive compensation.

(4) Department Heads are prohibited from employing or supervising any individual, when to do so would constitute cronyism.

(5) City positions should be advertised to the public and filled pursuant to an objective selection process
based upon qualification.

(b) Resolving a Violation.

In the event nepotism or cronyism arises due to circumstances such as through promotion, transfer, the development of a consensual romantic and/or sexual relationship or marriage, the involved individuals have six (6) months in which to settle the issue voluntarily (i.e. by having one of them change assignment or leave City
employment.)

If the affected parties are unable to resolve the situation within the time provided, their immediate supervisors will review the case at the end of the six-month period. The supervisor’s decision concerning which employee must change assignment , made after
consultation with the Director of Human Resources, will be binding.

It is the responsibility of a City Official to report a violation of this Section. A City employee must notify his/her supervisor,
and it is the responsibility of an elected or
appointed official to notify the City Manager, or the City Attorney in the case of a violation by the City Manager, when
any of the following situations occur:

(1) When a person who is hired or appointed, or is being considered to be hired or appointed, has a family relationship or consensual romantic and/or sexual relationship with
a City Official, and/or

(2
) When a City Official has or develops a family relationship or consensual romantic and/or sexual relationship with another City Official who occupies a position in his or her direct supervisory chain of command, and/or

(3
) When hiring, promotion, appointment or supervision of a City Official constitutes cronyism as defined in Section II.

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 91 The intent of this Section is to ensure that no conflict of interest, favoritism, preferential treatment, or discrimination enters into the hiring, promotion, and/or transfer practices of the City.

(d) Penalty for Failure to Report.

A City Official, other than an elected official, who knows or should know that a person with whom he or she has a family relationship or consensual romantic and/or sexual relationship is employed by the City, or who knows or should know of any employment decision that constitutes nepotism or cronyism and fails to report the violation, is subject
to discipline, including but not limited to suspension or termination.

An elected official who knows or should know that a person with whom he or she has a family relationship or consensual romantic and/or sexual relationship is employed by the City,
or who knows or should know of an employment decision that constitutes nepotism or cronyism and fails to report the violation, is subject to censure.

Sec. 2-3.404 Restricting Nepotism and Cronyism in Public Contracting.

(a) Statement of Policy.

It is the policy of the City of Hercules to avoid favoritism or discrimination in making decisions to award contracts for supplies,
construction, maintenance, professional or other
services. The awarding of a contract or the approval of payments or expenses under a contract by a City Official, to a person with whom she or he has a family relationship or a consensual romantic and/or
sexual relationship, is regarded as a violation of this Section .

Nepotism and cronyism as defined in Section 2-3.402 are hereby prohibited from City contracting decisions to the full extent permitted by law.

It is therefore the City ’s policy to prohibit nepotism and cronyism in City contracts,
according to the guidelines below:

(1) An individual Contractor shall not be awarded a contract with the City when the Contractor has a family relationship or consensual romantic and/or sexual relationship with a City Official who may have some influence over the award or management of the contract, or when the award of a contract to that individual Contractor
would constitute nepotism or cronyism.

(2) Firms shall not be awarded contracts with the City when an owner, manager, senior member, principal, officer, or partner of the firm has a family relationship or consensual romantic and/or sexual relationship with
a City Official who may have
some influence over the award or management of the contract, or when the award of a contract to a firm would constitute nepotism or cronyism.

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 92 (3) A City Official is prohibited from awarding contracts to any individual with whom he or she has a family relationship or consensual romantic and/or sexual relationship, or to any firm when an owner, manager, senior member, principal, officer, or partner of the firm has a family relationship or consensual romantic and/or sexual relationship with the employee or official, or when to do so would constitute
nepotism or cronyism.

The intent of this Section is to ensure that no conflict of interest, favoritism, or discrimination enters into the contracting practices of the City.

(b) Responsibility to Report a Violation of Regulations Against Contracting with Relatives or Contracts that Constitute Cronyism.

It is the responsibility of a City Official to report a violation of this Section. A City employee must notify his or her supervisor, and an elected or appointed official must notify the City Manager, or the City Attorney in the case of a violation by the City Manager, when he or she is aware of any of the following situations:

(1
) When a person who has a family relationship or consensual romantic and/or sexual relationship with a City Official is being considered for the award of a contract to provide services to the City, and/or

(2
) When a City Official has or develops a family relationship or a romantic and/or consensual sexual relationship with a person who has an existing contract to provide services to the City, and/or

(3
) When the award of a contract would constitute nepotism or cronyism as defined in Section 2-3.402.

A City Official, other than an elected city official, who knows or should know that a person with whom he or she has a family relationship or consensual romantic and/or sexual relationship is being considered for or has been awarded a contract with the City in violation of this Section, and fails to report the violation, is subject to discipline, including, but not limited to,
suspension or termination.

An elected official who knows or should know that a person with whom he or she has a family relationship or consensual romantic and/or sexual relationship is being considered for or has been awarded a contract with the City in violation of this Section and fails to report the violation,
is subject to censure.

A Contractor who has a contract with the City or who seeks a contract with the City and fails to report that a person with whom she or he has a family relationship or consensual romantic and/or sexual relationship is employed by the City or is a City Official, or that the award of the contract constitutes cronyism in violation of this Section, may have his or
her contract terminated and may be precluded from being awarded any future contracts with the City.

DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 93 DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 94

Page 1 ends

CONTRACTOR ACKNOWLEDGMENT OF CITY OF HERCULES NEPOTISM AND CRONYISM POLICY SECTI
ON A:

To be completed by City Representative Prior to Distribution to Contractor:

City Representative Phone Project Spec No.

Department Contract/Proposal Name
SECT
ION B:

This is an Original Revised form (check one). If Original, complete all that applies. If revised, complete Contractor Name and include any changed data.

Contractor/Consultant Name Phone
Street Address City State Zip
Type of Submission (Check One) Bid Proposal Qualification Contract/Agreement/Amendment SECT
ION C:

The undersigned Contractor’s Representative acknowledges by his or her signature the following:

It is the policy of the City of Hercules to avoid favoritism or discrimination in making decisions to award contracts for supplies, construction, maintenance, professional or other services. The awarding of a contract or the approval of payments or expenses under a contract by a City Official, to a person with whom she or he has a family relationship or a consensual romantic and/or sexual relationship, is regarded as a violation of t his Section. Nepotism and cronyism as defined in Section 2-3.402 are hereby prohibited from City contracting decisions to the full extent permitted by law.

I h
ave read Hercules Ordinance Number 486 and certify that I/we have not knowingly, nor will I/we in the future, enter into a contract with the City of Hercules or accept payment from the City of Hercules when to do so is in violation of Ordinance Number 486.

If c
ircumstances require changing the information on this form while I/we have a bid, proposal, or qualifications under review, or while we are under contract with the City, we will amend this form within five business days.

Signature Date
Print Name of Signer Position
SECT
ION D:

To Be Completed by Administrative Services Departmen t with the City of Hercules after Submission of the Completed Form by Contractor
Date Received by City By
Edwin Gato 510-799-8200
22-012
Council Reso 22-032
Community Card ARPA
Program
Finance
X
Yiftee 650-533-0938
325 Sharon Park Dr #215 Menlo Park CA 94025
X

XXXXXXXXXXXXXX
via DocuSign

XXXXXXXXXXXXXXX
via DocuSign
DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 6/9/2022
Ceo, YifteeDonna Novitsky
95 ORDINANCE NO. 534

AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF HERCULES AMENDING HERCULES MUNICIPAL CODE TITLE 2, BY ADDING A NEW ARTICLE 5 (CHAPTER 2-3.5) ENTITLED, “CITY CONTRACTOR EQUAL PAY ACT COMPLIANCE ”, TO PROVIDE A

LOCAL MEANS OF DETERMINING WHETHER ENTITIES CONTRACTING WITH

THE CITY OF HERCULES ARE IN COMPLIANCE WITH THE REQUIREMENTS OF

THE CALIFORNIA EQUAL PAY ACT
WHEREAS, the California Equal Pay Act was originally enacted to prohibit an employer from paying its employees less than employees of the opposite sex for equal work; and WHEREAS, in 2015, Governor Jerry Brown signed the California Fair Pay Act, which strengthened the California Equal Pay Act and signaled California’s commitment to achieving real gender pay equity; and
WHEREAS, since 2015 there have been additional amendments to the California Equal Pay Act; effective January 1, 2017, Governor Brown signed a bill that added race and ethnicity as protected categories so that the Act now prohibits paying employees less than employees of the opposite sex, or of another race, or of another ethnicity for substantially similar work; and WHEREAS, the protections, procedures, and remedies relating to race- or ethnicity-based claims are now identical to the ones relating to gender; and
WHEREAS, in addition, employers are prohibited from using prior salary to justify any sex -, race-, or ethnicity-based pay difference; and
WHEREAS, while the State of California has amended the Equal Pay Act to eliminate loopholes and expand its protections, there is no mechanism for a local agenc y to determine whether contractors or firms who seek to contract with the local agency are in compliance with the requirements of the Equal Pay Act; and
WHEREAS, recent salary studies have shown that women continue to be paid less than men for the same line of employment; and
WHEREAS, recent salary studies have verified that similarly qualified Black, Asian, and Latinx women continue to earn less on average than their white counterparts; and WHEREAS, anecdotal evidence suggests that the COVID -19 pandemic has disproportionately impacted women, especially women of color.

DocuSign Envelope ID: 6377961B-C5E9-4CBB-B346-030C1DD7589C DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 96 NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF HERCULES DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. Recitals. The City Council hereby incorporates the above recitals into this Ordinance by this reference.

SECTION 2. Amendment. That the City Council of the City of Hercules does hereby AMEND the Hercules Municipal Code to ADD Title 2, Chapter 3, Article 5, to read as follows:
“Article 5. City Contractor EQUAL PAY ACT Compliance
Sec. 2-3.501 Purpose.

In adopting this Article, it is the intent of the City Council to provide a local means of determining whether entities contracting with the City are in compliance with the California Equal Pay Act.

The regulations established by this Article shall apply to all individuals or firms who provide services to the City as independent contractors or paid consultants.

Sec. 2-3.502 Definitions.
“City” as used herein shall mean the City of Hercules, California. “City Officials,” for the purposes of this Article, means City elected officials, City appointed officials, and City employees, including all individuals who are employed by the City Manager, City Attorney, and City Clerk, as well as all employees of City agencies and departments.
“Contractor” means any individual or firm providing or proposing to provide material, equipment, or services to the City as an independent contractor or consultant.

Sec. 2-3.503 Requiring Equal Pay Act Compliance in Public Contracting. (a) Statement of Policy. It is the policy of the City of Hercules to avoid awarding contracts for supplies, construction, maintenance, and professional or other services to contractors that are not in compliance with the requirements of the California Equal Pay Act. The awarding of a contract or the approval of payments or expenses under a contract DocuSign Envelope ID: 6377961B-C5E9-4CBB-B346-030C1DD7589C DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 97 by a City Official, to a person or entity that has not complied with the reporting requirements of this Article, is regarded as a violation of this Section.

It is therefore the City’s policy to prohibit awarding City contracts, according to the guidelines below:
(1) A contractor shall not be awarded a contract with the City when the contractor has been determined to have violated the Equal Pay Act at any time within the preceding five (5) years.
(2) A firm shall not be awarded a contract with the City when an owner, manager, senior member, principal, officer, or partner of the firm has been determined to have violated the Equal Pay Act at any time within the preceding five (5) years. (3) A City Official The City Manager is prohibited from approving the awarding of a contract to a contractor who refuses to comply with the requirement to provide an acknowledgment of Equal Pay Act compliance pursuant to Section 2-3.506.

The intent of this Section is to ensure that no discrimination against individuals or groups protected under the California Equal Pay Act enters into the contracting practices of the City.
(b) Responsibility to Report a Violation of Contractor Equal Pay Act compliance requirements. It is the responsibility of City Officials to report a violation of this Section.

A City employee must notify his or her supervisor, and an elected or appointed official must notify the City Manager, when he or she is aware of any of the following situations:
(1) When a contractor has been found to be in violation of the Equal Pay Act and is being considered for the award of a contract to provide services to the City; and/or (2) When a City Official becomes aware of a contractor with an existing contract to provide material, equipment or services to the City is found to be in violation of the Equal Pay Act.
(c) Penalty for Failure to Report. A City Official who knows or should know that a contractor is being considered for or has been awarded a contract with the City in violation of this Article, and fails to report the violation, is subject to discipline, including, but not limited to, suspension or termination.

DocuSign Envelope ID: 6377961B-C5E9-4CBB-B346-030C1DD7589C DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 98 (d) A contractor with a contract with the City or who seeks a contract with the City and fails to report a violation of the Equal Pay Act or is otherwise not in compliance with requirements of this Article may have his or her contract terminated and may be precluded from being awarded any future contracts with the City.

Sec. 2-3.505 Penalties Not Exclusive.

The penalties provided under this Article are not exclusive, and do not preclude punishment under any other applicable provision of law.

Sec. 2-3.506 Notice and Acknowledgment.
(a) The requirements of this Article shall be acknowledged by all contractors, on a form developed by the City Attorney and provided to contractors by the City Clerk. No contract shall be entered into without submission of the required acknowledgment form. (b) All contractors, and all prospective contractors, shall be notified in writing of the requirements of this Article at the time the City issues a request for proposals or qualifications, and prior to entering into an agreement.” SECTION 3. SEVERABILITY. If any section, subsection, sentence, clause, or phrase of this Ordinance is for any reason held to be invalid, such decisions shall not affect the validity of the remaining portions of this Ordinance. The Council hereby declares that it would have adopted the Ordinance, and each section, subsection, sentence, clause, or phr ase thereof, irrespective of the fact that any one or more sections, subsections, sentences, clauses or phrases be deleted.

SECTION 4. Effective Date and Publication. The City Clerk shall certify to the adoption of this Ordinance and shall publish or post the Ordinance as required by law. This Ordinance shall be effective thirty (30) days from date of final adoption.

THE FOREGOING ORDINANCE was first read at a regular meeting of the Hercules City Council on the 13 th day of July, 2021, and was passed and adopted at a regular meeting of the Hercules City Council on the 27th day of July, 2021, by the following vote:

DocuSign Envelope ID: 6377961B-C5E9-4CBB-B346-030C1DD7589C DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 99 AYES:

NOES:

ABSENT:

ABSTAIN:

Chris Kelley, Mayor
__________________________________________
Lori Martin, MMC
Administrative Services Director / City Clerk
COUNCIL MEMBERS: T. Grimsley, D. Romero, A.Walker-Griffin, Vice Mayor D. Bailey, Mayor C. Kelley.

None.

DocuSign Envelope ID: 6377961B-C5E9-4CBB-B346-030C1DD7589C DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 100

CONTRACTOR ACKNOWLEDGMENT OF COMPLIANCE WITH CALIFORNIA EQUAL PAY ACT SECTION A:

To be completed by City Representative Prior to Distribution to Contractor:

City Representative Phone Project Spec No.

Department Contract/Proposal Name __
SECTION B:

This is an Original Revised form (check one). If Original, complete all that applies. If revised, complete Contractor Name and include any changed data.

Contractor/Consultant Name____________________ Phone
Street Address City State Zip
Type of Submission (Check One) Bid Proposal Qualification Contract/Agreement/Amendment SECTION C:

The undersigned Contractor’s Representative acknowledges by his or her signature the following:

It is the policy of the City of Hercules to avoid awarding contracts for supplies, construction, maintenance, professional or other services to contractors who are not in compliance with the equal pay requirements of the California Equal Pay Act.. The awarding of a contract or the approval of payments or expenses under a contract by a City Official, to a person or contractor not in compliance with the California Equal Pay Act, is regarded as a violation of this Section.

I have read Hercules Ordinance Number 534 and certify that I/we have not in the past 5 years been found to be in violation of the California Equal pay Act, and I/we have not knowingly, nor will I/we in the future, enter into a contract with the City of Hercules or accept payment from the City of Hercules when to do so is in violation of Ordinance Number 534 .

If circumstances require changing the information on this form while I/we have a bid, proposal, or qualifications under review, or while we are under contract with the City, we will amend this form within five business days.

Signature Date
Print Name of Signer Position
SECTION D:

To Be Completed by Administrative Services Department with the City of Hercules after Submission of the Compl eted Form by Contractor
Date Received by City By
Edwin Gato 510-799-8200
22-012
Council Reso 22-032
Community Card
ARPA Program
Finance
X
Yftee 650-533-0938
325 Sharon Park Drive #215 Menlo Park CA 94025
X

XXXXXXXXXXXXXXXX
via DocuSign

XXXXXXXXXXXXXXX
via DocuSign
DocuSign Envelope ID: 3441B701-0A49-49D8-8785-032CEA154E54 Donna Novitsky
6/9/2022
Ceo, Yiftee
101
Certificate Of Completion
Envelope Id: 3441B7010A4949D88785032CEA154E54 Status: Completed Subject: Contract - 22-012- Yiftee - Community Card ARPA Program Agreement Source Envelope:

Document Pages: 28 Signatures: 6 Envelope Originator:

Certificate Pages: 5 Initials: 0 A. Clarisse Saechao
AutoNav: Enabled
EnvelopeId Stamping: Enabled
Time Zone: (UTC-08:00) Pacific Time (US & Canada)
[email protected]
IP Address: 66.7.246.210
Record Tracking
Status: Original
6/6/2022 1:52:59 PM
Holder: A. Clarisse Saechao
[email protected]
Location: DocuSign
Security Appliance Status: Connected Pool: StateLocal
Storage Appliance Status: Connected Pool: City of Hercules Location: DocuSign Signer Events Signature Timestamp
Patrick Tang
[email protected]
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Signed by link sent to [email protected]
Using IP Address: 66.7.246.210
Sent: 6/6/2022 2:07:21 PM
Resent: 6/9/2022 12:39:32 PM
Viewed: 6/9/2022 5:32:12 PM
Signed: 6/9/2022 5:32:41 PM
Electronic Record and Signature Disclosure:

Accepted: 6/9/2022 5:32:12 PM
ID: 6aef8e23-d23b-4d77-9729-7777bd69a125
Dante Hall
[email protected]
City Manager
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Signed by link sent to [email protected]
Using IP Address: 66.7.246.210
Sent: 6/9/2022 5:32:43 PM
Resent: 6/13/2022 10:28:05 AM
Resent: 6/14/2022 9:15:54 AM
Resent: 6/15/2022 1:46:35 PM
Resent: 6/21/2022 11:04:03 AM
Resent: 6/22/2022 7:50:49 AM
Viewed: 6/22/2022 8:51:43 AM
Signed: 6/22/2022 8:54:06 AM
Electronic Record and Signature Disclosure:

Accepted: 6/22/2022 8:51:43 AM
ID: f6fb84b6-e518-4dab-ae87-759e9a264144
Donna Novitsky
[email protected]
Ceo, Yiftee
North Lake Tahoe Resort Association
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Signed by link sent to [email protected]
Using IP Address: 76.21.115.113
Sent: 6/9/2022 5:32:44 PM
Viewed: 6/9/2022 10:34:35 PM
Signed: 6/9/2022 10:41:14 PM
Electronic Record and Signature Disclosure:

Accepted: 6/9/2022 10:34:35 PM
ID: 29eb49f3-d01e-48cd-9c8d-c565cc997507
102
Signer Events Signature Timestamp
Lauren Berges
[email protected]
City Clerk / Public Information Officer
City of Hercules
Security Level: Email, Account Authentication
(None)
Signature Adoption: Uploaded Signature Image
Signed by link sent to [email protected]
Using IP Address: 66.7.246.210
Sent: 6/22/2022 8:54:08 AM
Viewed: 6/22/2022 9:36:33 AM
Signed: 6/22/2022 9:36:39 AM
Electronic Record and Signature Disclosure:

Not Offered via DocuSign
In Person Signer Events Signature Timestamp
Editor Delivery Events Status Timestamp
Agent Delivery Events Status Timestamp
Intermediary Delivery Events Status Timestamp
Certified Delivery Events Status Timestamp
Carbon Copy Events Status Timestamp
Edwin Gato
[email protected]
Security Level: Email, Account Authentication
(None)
Sent: 6/22/2022 8:54:08 AM
Viewed: 6/22/2022 10:06:01 AM
Electronic Record and Signature Disclosure:

Accepted: 6/16/2022 6:20:52 PM
ID: 302f0287-edf5-47ea-9fba-4676cf5a901a
Witness Events Signature Timestamp
Notary Events Signature Timestamp
Envelope Summary Events Status Timestamps
Envelope Sent Hashed/Encrypted 6/6/2022 2:07:21 PM
Certified Delivered Security Checked 6/22/2022 9:36:33 AM Signing Complete Security Checked 6/22/2022 9:36:39 AM
Completed Security Checked 6/22/2022 9:36:39 AM
Payment Events Status Timestamps
Electronic Record and Signature Disclosure
103

ELECTRONIC RECORD AND SIGNATURE DISCLOSURE
From time to time, City of Hercules (we, us or Company) may be required by law to provide to you certain written notices or disclosures. Described below are the terms and conditions for providing to you such notices and disclosures electronically through the DocuSign system.

Please read the information below carefully and thoroughly, and if you can access this information electronically to your satisfaction and agree to this Electronic Record and Signature Disclosure (ERSD), please confirm your agreement by selecting the check-box next to ‘I agree to use electronic records and signatures’ before clicking ‘CONTINUE’ within the DocuSign system.

Getting paper copies
At any time, you may request from us a paper copy of any record provided or made available electronically to you by us. You will have the ability to download and print documents we send to you through the DocuSign system during and immediately after the signing session and, if you elect to create a DocuSign account, you may access the documents for a limited period of time (usually 30 days) after such documents are first sent to you. After such time, if you wish for us to send you paper copies of any such documents from our office to you, you will be charged a $0.00 per-page fee. You may request delivery of such paper copies from us by following the procedure described below.

Withdrawing your consent
If you decide to receive notices and disclosures from us electronically, you may at any time change your mind and tell us that thereafter you want to receive required notices and disclosures only in paper format. How you must inform us of your decision to receive future notices and disclosure in paper format and withdraw your consent to receive notices and disclosures electronically is described below.

Consequences of changing your mind
If you elect to receive required notices and disclosures only in paper format, it will slow the speed at which we can complete certain steps in transactions with you and delivering services to you because we will need first to send the required notices or disclosures to you in paper format, and then wait until we receive back from you your acknowledgment of your receipt of such paper notices or disclosures. Further, you will no longer be able to use the DocuSign system to receive required notices and consents electronically from us or to sign electronically documents from us.

All notices and disclosures will be sent to you electronically Electronic Record and Signature Disclosure created on: 7/30/2020 6:36:10 PM Parties agreed to: Patrick Tang, Dante Hall, Donna Novitsky, Edwin Gato 104
Unless you tell us otherwise in accordance with the procedures described herein, we will provide electronically to you through the DocuSign system all required notices, disclosures, authorizations, acknowledgements, and other documents that are required to be provided or made available to you during the course of our relationship with you. To reduce the chance of you inadvertently not receiving any notice or disclosure, we prefer to provide all of the required notices and disclosures to you by the same method and to the same address that you have given us. Thus, you can receive all the disclosures and notices electronically or in paper format through the paper mail delivery system. If you do not agree with this process, please let us know as described below. Please also see the paragraph immediately above that describes the consequences of your electing not to receive delivery of the notices and disclosures electronically from us.

How to contact City of Hercules:

You may contact us to let us know of your changes as to how we may contact you electronically, to request paper copies of certain information from us, and to withdraw your prior consent to receive notices and disclosures electronically as follows:

To contact us by email send messages to: [email protected]

To advise City of Hercules of your new email address
To let us know of a change in your email address where we should send notices and disclosures electronically to you, you must send an email message to us at [email protected] and in the body of such request you must state: your previous email address, your new email address. We do not require any other information from you to change your email address.

If you created a DocuSign account, you may update it with your new email address through your account preferences.

To request paper copies from City of Hercules
To request delivery from us of paper copies of the notices and disclosures previously provided by us to you electronically, you must send us an email to [email protected] and in the body of such request you must state your email address, full name, mailing address, and telephone number. We will bill you for any fees at that time, if any.

To withdraw your consent with City of Hercules
To inform us that you no longer wish to receive future notices and disclosures in electronic format you may:
105
i. decline to sign a document from within your signing session, and on the subsequent page, select the check-box indicating you wish to withdraw your consent, or you may; ii. send us an email to [email protected] and in the body of such request you must state your email, full name, mailing address, and telephone number. We do not need any other information from you to withdraw consent.. The consequences of your withdrawing consent for online documents will be that transactions may take a longer time to process..

Required hardware and software
The minimum system requirements for using the DocuSign system may change over time. The current system requirements are found here: https://support.docusign.com/guides/signer-guide- signing-system-requirements.

Acknowledging your access and consent to receive and sign documents electronically To confirm to us that you can access this information electronically, which will be similar to other electronic notices and disclosures that we will provide to you, please confirm that you have read this ERSD, and (i) that you are able to print on paper or electronically save this ERSD for your future reference and access; or (ii) that you are able to email this ERSD to an email address where you will be able to print on paper or save it for your future reference and access. Further, if you consent to receiving notices and disclosures exclusively in electronic format as described herein, then select the check-box next to ‘I agree to use electronic records and signatures’ before clicking ‘CONTINUE’ within the DocuSign system.

By selecting the check-box next to ‘I agree to use electronic records and signatures’, you confirm that:
 You can access and read this Electronic Record and Signature Disclosure; and  You can print on paper this Electronic Record and Signature Disclosure, or save or send this Electronic Record and Disclosure to a location where you can print it, for future reference and access; and
 Until or unless you notify City of Hercules as described above, you consent to receive exclusively through electronic means all notices, disclosures, authorizations, acknowledgements, and other documents that are required to be provided or made available to you by City of Hercules during the course of your relationship with City of Hercules.
106
Original Agreement No. 22-012
Yiftee for a Shop Local/Gift Card Program
AMENDMENT NO. 1
Approving Revised Attachment B to add additional $75,000

1. Parties. The parties to this Contract Amendment are the City of Hercules, a public body corporate and the following named Contractor:

Yiftee
325 Sharon Park Drive #215, Menlo Park, CA 94025
(650) 533-0938
Attention: Donna Novitsky
[email protected]
The parties to this Contract Amendment do mutually agree and promise as follows:

2. Purpose. This Amendment No. 1 is being entered into to a mend an existing contract between the City and Contractor which was approved by the City Council of the City of Hercules on April 26, 2022, by Resolution No. 22-032. Said contract shall hereinafter be referred to as the "Original Contract" and is incorporated herein by reference.

3. Original Contract Provisions. The parties hereto agree to continue to abide by those terms and conditions of the Original Contract, and any amendments thereto, which are unaffected by this Contract Amendment Agreement.

4. Amendment. This Amendment No. 1 is in tended to amend the Original Contract and previously approved amendments (collectively, the "Amended Contract") thereto to provide for additional co mpensation in an amount not to exceed $ 75,000, for a total contract amount of $140,000.

5. Amendment Approval: This Amendment No. 1 is hereby approved by the City Council of the City of Hercules on this 28th day of February, 2023.

6. Signatures. These signatures attest the parties' agreement hereto:

City of Hercules
s/_______________________________
Dante Hall, City Manager
Date: ___________________________
Approved as to form:

By ______________________________
Patrick Tang, City Attorney
Contractor: Yiftee
s/_______________________________
_________________________________
Name/Title
Date: ___________________________
Resolution No. 23-010
DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 3/6/2023
3/14/2023
CEO, Yiftee, Inc.Donna Novitsky
107

ORDINANCE NO. 486

AN ORDINANCE OF THE CITY OF HERC ULES ESTABLISHING POLICIES TO

ADDRESS AND PREVENT NEPOTISM A ND CRONYISM IN CITY EMPLOYMENT

AND CONTRACTING

WHEREAS, to promote and maintain confidence in City government, it is imperative that City employment and contracting are free from nepotism, cronyism, patronage, and favoritism; and

WHEREAS, nepotism, cronyism, patronage, a nd favoritism are demoralizing and dispiriting to the dedicated, hard-working employees of the City; and

NOW, THEREFORE, BE IT ORDAINED by the City Council of the City of Hercules as follows:

1. The Hercules Municipal Code is hereby amended to include Title 2, Chapter 3, Article 4, to read as follows:

“Article 4. PREVENTION OF NEPOTISM AND CRONYISM IN

EMPLOYMENT AND CONTRACTING

Sec. 2-3.401 Purpose

Sec. 2-3.402 Definitions

“City” as used herein shall mean the City of Hercules, California.

DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 108

“City Official s” for the purposes of this Article means City Elected Officials, City Appointed Officials, appointees to City ad hoc or standing committees, appointees to City Commissions, and City Employees, including all individuals who are employed by the City Manager, City Attorney, and City Clerk, as well as all employees of City Agencies and Departments.

“Nepotism” means employing, promoting, supervising or contracting with a person or persons who have a family relationship or a consensual romantic and/or sexual relationship with a
City official.

Sec. 2-3.403 Restricting Nepotism and Cronyism in Public Employment.

(a). Statement of Policy.

It is the policy of the City of Hercules to hire, promote, and transfer employees on the basis of individual merit and to avoid favoritism or discrimination in making such decisions.

The employment of relatives of City officials, in positions where one might have influence over the other’s status or job security, is regarded as a violation of this Section.

Nepotism
and cronyism, as defined in Section 2-3.402 , are prohibited from City employment decisions to the full extent permitted by law.

It is therefore the City ’s policy to prohibit nepotism and cronyism in public employment according to the guidelines below:

DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 109

(1) An individual will not be hired, promoted, transferred, or otherwise placed into a position when a person with whom the individual has a family relationship or consensual romantic and/or sexual relationship occupies a position in his or her direct supervisory chain of command.

(2) Individuals will not be hired, promoted, transferred, or otherwise placed into a position when to do so would constitute cronyism.

(4) Department Heads are prohibited from employing or supervising any individual, when to do so would constitute cronyism.

(5) City positions should be advertised to the public and filled pursuant to an objective selection process
based upon qualification.

(b) Resolving a Violation.

(1) When a person who is hired or appointed, or is being considered to be hired or appointed, has a family relationship or consensual romantic and/or sexual relationship with
a City Official, and/or

(3
) When hiring, promotion, appointment or supervision of a City Official constitutes cronyism as defined in Section II.

DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 110

The intent of this Section is to ensure that no conflict of interest, favoritism, preferential treatment, or discrimination enters into the hiring, promotion, and/or transfer practices of the City.

(d) Penalty for Failure to Report.

Sec. 2-3.404 Restricting Nepotism and Cronyism in Public Contracting.

(a) Statement of Policy.

Nepotism and cronyism as defined in Section 2-3.402 are hereby prohibited from City contracting decisions to the full extent permitted by law.

It is therefore the City ’s policy to prohibit nepotism and cronyism in City contracts,
according to the guidelines below:

DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 111

(3) A City Official is prohibited from awarding contracts to any individual with whom he or she has a family relationship or consensual romantic and/or sexual relationship, or to any firm when an owner, manager, senior member, principal, officer, or partner of the firm has a family relationship or consensual romantic and/or sexual relationship with the employee or official, or when to do so would constitute
nepotism or cronyism.

The intent of this Section is to ensure that no conflict of interest, favoritism, or discrimination enters into the contracting practices of the City.

(b) Responsibility to Report a Violation of Regulations Against Contracting with Relatives or Contracts that Constitute Cronyism.

(2
) When a City Official has or develops a family relationship or a romantic and/or consensual sexual relationship with a person who has an existing contract to provide services to the City, and/or

(3
) When the award of a contract would constitute nepotism or cronyism as defined in Section 2-3.402.

DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 112
DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 113
Pag e 1

CONTRACTOR ACKNOWLEDGMENT OF CITY OF HERCULES NEPOTISM AND CRONYISM POLICY SECT
ION A:

To be completed by City Representative Prior to Distribution to Contractor:

City Representative Phone Project Spec No.

Department Contract/Proposal Name
SE
CTION B:

This is an Original Revised form (check one). If Original, complete all that applies. If revised, complete Contractor Name and include any changed data.

Contractor/Consultant Name Phone
Street Address City State Zip
Type of Submission (Check One) Bid Proposal Qualification Contract/Agreement/Amendment SE
CTION C:

The undersigned Contractor’s Representative acknowledges by his or her signature the following:

It is the policy of the City of Hercules to avoid favoritism or discrimination in making decisions to award contracts for supplies, construction, maintenance, professional or other services. The awarding of a contract or the approval of payments or expenses under a contract by a City Official, to a person with whom she or he has a family relationship or a consensual romantic and/or sexual relationship, is regarded as a violation of t his Section. Nepotism and cronyism as defined in Section 2-3.402 are hereby prohibited from City contracting decisions to the full extent permitted by law.

I
have read Hercules Ordinance Number 486 and certify that I/we have not knowingly, nor will I/we in the future, enter into a contract with the City of Hercules or accept payment from the City of Hercules when to do so is in violation of Ordinance Number 486.

If
circumstances require changing the information on this form while I/we have a bid, proposal, or qualifications under review, or while we are under contract with the City, we will amend this form within five business days.

Signature Date
Print Name of Signer Position
SE
CTION D:

To Be Completed by Administrative Services Departmen t with the City of Hercules after Submission of the Completed Form by Contractor
Date Received by City By
DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB Donna Novitsky
Yiftee, Inc.

CEO, Yiftee, Inc.
325 Sharon Park Dr #215
3/14/2023
CA 94025Menlo Park
650-533-0938
510-799-8200

3/15/2023
Edwin Gato 22-012_Amendment1
Reso 23-010
Eibleis Melendez

Finance
Acting City Clerk
Shop Local Gift Card
Program
114
ORDINANCE NO. 534

LOCAL MEANS OF DETERMINING WHETHER ENTITIES CONTRACTING WITH

THE CITY OF HERCULES ARE IN COMPLIANCE WITH THE REQUIREMENTS OF

DocuSign Envelope ID: 6377961B-C5E9-4CBB-B346-030C1DD7589C DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 115

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF HERCULES DOES HEREBY ORDAIN AS FOLLOWS:

SECTION 1. Recitals. The City Council hereby incorporates the above recitals into this Ordinance by this reference.

In adopting this Article, it is the intent of the City Council to provide a local means of determining whether entities contracting with the City are in compliance with the California Equal Pay Act.

The regulations established by this Article shall apply to all individuals or firms who provide services to the City as independent contractors or paid consultants.

Sec. 2-3.503 Requiring Equal Pay Act Compliance in Public Contracting. (a) Statement of Policy. It is the policy of the City of Hercules to avoid awarding contracts for supplies, construction, maintenance, and professional or other services to contractors that are not in compliance with the requirements of the California Equal Pay Act. The awarding of a contract or the approval of payments or expenses under a contract DocuSign Envelope ID: 6377961B-C5E9-4CBB-B346-030C1DD7589C DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 116
by a City Official, to a person or entity that has not complied with the reporting requirements of this Article, is regarded as a violation of this Section.

DocuSign Envelope ID: 6377961B-C5E9-4CBB-B346-030C1DD7589C DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 117
(d) A contractor with a contract with the City or who seeks a contract with the City and fails to report a violation of the Equal Pay Act or is otherwise not in compliance with requirements of this Article may have his or her contract terminated and may be precluded from being awarded any future contracts with the City.

Sec. 2-3.505 Penalties Not Exclusive.

The penalties provided under this Article are not exclusive, and do not preclude punishment under any other applicable provision of law.

DocuSign Envelope ID: 6377961B-C5E9-4CBB-B346-030C1DD7589C DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 118
AYES:

NOES:

ABSENT:

ABSTAIN:

None.

DocuSign Envelope ID: 6377961B-C5E9-4CBB-B346-030C1DD7589C DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 119

CONTRACTOR ACKNOWLEDGMENT OF COMPLIANCE WITH CALIFORNIA EQUAL PAY ACT

SECTION A:

To be completed by City Representative Prior to Distribution to Contractor:

City Representative Phone Project Spec No.

Department Contract/Proposal Name __

SECTION B:

This is an Original Revised form (check one). If Original, complete all that applies. If revised, complete Contractor Name and include any changed data.

Contractor/Consultant Name____________________ Phone

Street Address City State Zip

Type of Submission (Check One) Bid Proposal Qualification Contract/Agreement/Amendment

SECTION C:

The undersigned Contractor’s Representative acknowledges by his or her signature the following:

If circumstances require changing the information on this form while I/we have a bid, proposal, or qualifications under review, or while we are under contract with the City, we will amend this form within five business days.

Signature Date

Print Name of Signer Position

SECTION D:

To Be Completed by Administrative Services Department with the City of Hercules after Submission of the Compl eted Form by Contractor

Date Received by City By

DocuSign Envelope ID: B9894C9A-D836-4795-AC6C-F5C3C9CA96CB 94025
Yiftee, Inc.

Menlo Park
Donna Novitsky
650-533-0938
CEO, Yiftee, Inc.
3/14/2023
CA
325 Sharon Park Dr #215
Shop Local Gift Card
Program
Finance
22-012_Amendment1
Reso 23-010
Edwin Gato

Acting City Clerk
Eibleis Melendez
3/15/2023

510-799-8200
120
Certificate Of Completion
Envelope Id: B9894C9AD8364795AC6CF5C3C9CA96CB Status: Completed Subject: Contract - 22-012_Yiftee_Shop Local Gift Card Program_Amendment 1 Source Envelope:

Document Pages: 14 Signatures: 7 Envelope Originator:

Certificate Pages: 5 Initials: 1 A. Clarisse Saechao
AutoNav: Enabled
EnvelopeId Stamping: Enabled
Time Zone: (UTC-08:00) Pacific Time (US & Canada)
[email protected]
IP Address: 66.7.246.210
Record Tracking
Status: Original
3/6/2023 10:09:01 AM
Holder: A. Clarisse Saechao
[email protected]
Location: DocuSign
Security Appliance Status: Connected Pool: StateLocal
Storage Appliance Status: Connected Pool: City of Hercules Location: DocuSign Signer Events Signature Timestamp
Patrick Tang
[email protected]
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Using IP Address: 66.7.246.210
Sent: 3/6/2023 10:14:04 AM
Viewed: 3/6/2023 4:26:03 PM
Signed: 3/13/2023 12:32:26 PM
Electronic Record and Signature Disclosure:

Accepted: 3/6/2023 4:26:03 PM
ID: 82c2028d-6dec-4c91-a8a8-516bc7276f76
Dante Hall
[email protected]
City Manager
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Using IP Address: 66.7.246.210
Sent: 3/6/2023 10:14:04 AM
Viewed: 3/6/2023 11:01:39 AM
Signed: 3/6/2023 11:01:48 AM
Electronic Record and Signature Disclosure:

Accepted: 3/6/2023 11:01:39 AM
ID: 6cca8b1d-d30b-4975-afdb-8884bc13929e
Donna Novitsky
[email protected]
CEO, Yiftee, Inc.

Yiftee, Inc.

Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Using IP Address: 73.189.205.130
Sent: 3/6/2023 10:14:05 AM
Resent: 3/14/2023 3:16:20 PM
Viewed: 3/14/2023 8:05:04 PM
Signed: 3/14/2023 8:07:58 PM
Electronic Record and Signature Disclosure:

Accepted: 3/14/2023 8:05:04 PM
ID: 633334dd-879b-47dc-9c0d-c500feb62eb7
Eibleis Melendez
[email protected]
Acting City Clerk
City of Hercules
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Using IP Address: 66.7.246.210
Sent: 3/14/2023 8:08:01 PM
Viewed: 3/15/2023 8:54:30 AM
Signed: 3/15/2023 8:55:07 AM
Electronic Record and Signature Disclosure:

Not Offered via DocuSign
121
In Person Signer Events Signature Timestamp
Editor Delivery Events Status Timestamp
Agent Delivery Events Status Timestamp
Intermediary Delivery Events Status Timestamp
Certified Delivery Events Status Timestamp
Carbon Copy Events Status Timestamp
Nahid Vafadari
[email protected]
Security Level: Email, Account Authentication
(None)
Sent: 3/15/2023 8:55:09 AM
Electronic Record and Signature Disclosure:

Accepted: 11/7/2022 11:20:35 AM
ID: 3937c10a-a099-4cdc-82ec-bc0b8a7cb54e
Deysi Ortega
[email protected]
Security Level: Email, Account Authentication
(None)
Sent: 3/15/2023 8:55:09 AM
Electronic Record and Signature Disclosure:

Accepted: 11/7/2022 11:46:26 AM
ID: d0828472-f8aa-4910-87a1-c73a4bbba623
Edwin Gato
[email protected]
Finance Director
Security Level: Email, Account Authentication
(None)
Sent: 3/15/2023 8:55:09 AM
Electronic Record and Signature Disclosure:

Accepted: 1/30/2023 3:30:59 PM
ID: 5a231397-c95e-46d1-af4a-ac016f36a3db
Witness Events Signature Timestamp
Notary Events Signature Timestamp
Envelope Summary Events Status Timestamps
Envelope Sent Hashed/Encrypted 3/6/2023 10:14:05 AM
Certified Delivered Security Checked 3/15/2023 8:54:30 AM Signing Complete Security Checked 3/15/2023 8:55:07 AM
Completed Security Checked 3/15/2023 8:55:09 AM
Payment Events Status Timestamps
Electronic Record and Signature Disclosure
122

All notices and disclosures will be sent to you electronically Electronic Record and Signature Disclosure created on: 7/30/2020 6:36:10 PM Parties agreed to: Patrick Tang, Dante Hall, Donna Novitsky, Nahid Vafadari, Deysi Ortega, Edwin Gato 123
Unless you tell us otherwise in accordance with the procedures described herein, we will provide electronically to you through the DocuSign system all required notices, disclosures, authorizations, acknowledgements, and other documents that are required to be provided or made available to you during the course of our relationship with you. To reduce the chance of you inadvertently not receiving any notice or disclosure, we prefer to provide all of the required notices and disclosures to you by the same method and to the same address that you have given us. Thus, you can receive all the disclosures and notices electronically or in paper format through the paper mail delivery system. If you do not agree with this process, please let us know as described below. Please also see the paragraph immediately above that describes the consequences of your electing not to receive delivery of the notices and disclosures electronically from us.

How to contact City of Hercules:

To contact us by email send messages to: [email protected]

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To withdraw your consent with City of Hercules
To inform us that you no longer wish to receive future notices and disclosures in electronic format you may:
124
i. decline to sign a document from within your signing session, and on the subsequent page, select the check-box indicating you wish to withdraw your consent, or you may; ii. send us an email to [email protected] and in the body of such request you must state your email, full name, mailing address, and telephone number. We do not need any other information from you to withdraw consent.. The consequences of your withdrawing consent for online documents will be that transactions may take a longer time to process..

By selecting the check-box next to ‘I agree to use electronic records and signatures’, you confirm that:
 You can access and read this Electronic Record and Signature Disclosure; and  You can print on paper this Electronic Record and Signature Disclosure, or save or send this Electronic Record and Disclosure to a location where you can print it, for future reference and access; and
 Until or unless you notify City of Hercules as described above, you consent to receive exclusively through electronic means all notices, disclosures, authorizations, acknowledgements, and other documents that are required to be provided or made available to you by City of Hercules during the course of your relationship with City of Hercules.
125
Original Agreement No. 22-012
Resolution No. 23-032
Yiftee/Gift Card Program - Eat Local
AMENDMENT NO. 2

Approving Revised Attachment B to add additional $50,000

1. Parties. The parties to this Contract Amendment are the City of Hercules, a public body corporate and the following named Contractor:

Yiftee
325 Sharon Park Drive #215, Menlo Park, CA 94025
(650) 533-0938
Attention: Donna Novitsky
[email protected]

The parties to this Contract Amendment do mutually agree and promise as follows:

2. Purpose. This Amendment No. 2 is being entered into to a mend an existing contract between the City and Contractor which was approved by the City Council of the City of Hercules on April 26, 2022, by Resolution No. 22-032 and amended on February 28, 2023 by Resolution No. 23-010. Said contract shall her einafter be referred to as the "Original Contract" and is incorporated herein by reference.

4. Amendment. This Amendment No. 2 is intended to amend the Original Contract and previously approved amendments (collectively, the "Amended Contract") thereto to provide for additional compensation in an amount not to exceed $50,000, for a total contract amount of $190,000, and to authorize Yiftee to create a second instance of its Community Card program specific to the Eat Local program ( hereinafter referred to as the “Eat Local Card ”) under the same terms and conditions as the initial program.

5. Amendment Approval: This Amendment No. 2 is hereby approved by the City Council of the City of Hercules on this 13
th day of June, 2023.

6. Signatures. These signatures attest the parties' agreement hereto:

City of Hercules

s/_______________________________
Dante Hall, City Manager

Date: ___________________________

Approved as to form:

By ______________________________
Patrick Tang, City Attorney
Contractor: Yiftee

s/_______________________________

_________________________________
Name/Title

Date: ___________________________

DocuSign Envelope ID: C56DE9AC-70D4-49E5-8F82-0DA666113B68 7/1/2023
6/27/2023
CEO, Yiftee, Inc.

Donna Novitsky
126
Original Agreement No. 22-012
Yiftee for a Shop Local/Gift Card Program
AMENDMENT NO. 3

Amendment No. 3 to Original Agreement No. 22-012 to add additional $25,000

1. Parties. The parties to this Contract Amendment are the City of Hercules, a public body corporate and the following named Contractor:

Yiftee
325 Sharon Park Drive #215, Menlo Park, CA 94025
(650) 533-0938
Attention: Donna Novitsky
[email protected]

The parties to this Contract Amendment do mutually agree and promise as follows:

2. Purpose. This Amendment No. 3, approved by the City Council on November 14, 2023 by Resolution No. 23-062, is being entered into to amend an existing contract between the City and Contractor which was approved by the City Council of the City of Hercules on April 26, 2022, by Resolution No. 22-032; amended on February 28, 2023 by Resolution No. 23-010; and amended on June 13, 2023 by Resolution No. 23 -032. Said contract shall her einafter be referred to as the "Original Contract" and is incorporated herein by reference.

4. Amendment. This Amendment No. 3 is intended to amend the Original Contract and previously approved amendments (collectively, the "Amended Contract") thereto to provide for additional compensation in an amount not to exceed $25,000, for a total contract amount of $215,000.

5. Amendment Approval: This Amendment No. 3 is hereby approved by the City Council of the City of Hercules on this 14th day of November, 2023 by Resolution No. 23-062.

6. Signatures. These signatures attest the parties' agreement hereto:

City of Hercules

s/_______________________________
Dante Hall, City Manager

Date: ___________________________

Approved as to form:

By ______________________________
Christie Crowl, City Attorney
Contractor: Yiftee

s/_______________________________

_________________________________
Name/Title

Date: ___________________________

Docusign Envelope ID: BD70B742-5B02-4776-BC9A-22E272680CD5 2/18/2026
2/18/2026
CEO, Yiftee, Inc.Donna Novitsky
127

DISCUSSION AND/OR ACTION ITEM

AGENDA ITEMS

1. 26-047

2. 26-054

3. 26-051

4. 26-049

5. 26-053
128
1 STAFF REPORT TO THE CITY COUNCIL

DATE: Regular Meeting of February 24, 2026

TO: Mayor and Members of the City Council

VIA: Dante Hall, City Manager

SUBMITTED BY: Edwin Gato, Director of Finance

SUBJECT: Adoption of a Resolution Amending the Fiscal Year (FY) 2025-26 Operating and Capital Budgets to Reflect the Recommended Mid- year Adjustments

RECOMMENDED ACTION:

The staff recommends that the City Council receive the FY 2025-26 Mid-Year Financial Summary Report and adopt a resolution to amend the FY 2025 -26 operating and capital budgets to reflect the proposed mid-year adjustments.

EXECUTIVE SUMMARY:

The Midyear Budget Review provides a comprehensive assessment of the City's financial position halfway through the fiscal year. This review enables necessary adjustments to the current FY 2025-26 budget, reflecting any changes in expected revenues and expenditures since the Annual Budget was adopted on June 10, 2025.

BACKGROUND:

This report offers an analysis of the financial status of the City halfway through the fiscal year. It provides a comprehensive assessment of the City's General Fund and other non- general funds. The analysis compares projected revenues and expenditures with the actual receipts and expenses recorded as of December 31, 2025. This comparison provides a clear, insightful view of the City's fiscal performance, highlighting significant developments in the first half of the fiscal year.

ANALYSIS:

As part of the budget process, City staff are required to deliver a midyear report to the City Council. This report will evaluate revenues and expenditures and propose any necessary 129
2 adjustments. The midyear review provides a valuable opportunity to assess the Budget's status and make informed adjustments to the City's planned operations and capital projects as needed.

The annual operating budget has been adopted through a careful, responsible process that aligns with the City’s financial policies. This method is particularly crucial given the uncertainties arising from unprecedented inflation and national instability. The City has effectively maintained its fiscal health by adhering to conservative budgeting practices and remaining within its financial capabilities.

This year, the staff is proposing several budget modifications in response to unforeseen financial circumstances. These adjustments aim to address the challenges while upholding the City’s commitment to sound financial management. The table below summarizes the proposed budget amendments:

The following section presents an analysis of the City's financial resources, beginning with an overview of the General Fund. The General Fund is the City's primary operating fund, supporting essential services such as law enforcement, public works, parks and recreation, and community development, as well as vital administrative functions.

General Fund
The General Fund is a crucial financial resource for the city, drawing on a diverse array of taxes, fees, and general revenue sources. This comprehensive funding structure enables effective allocation of resources across a wide range of essential expenses. As a result, the General Fund provides substantial flexibility in financial planning, allowing city officials to direct funds toward pressing community nee ds rather than confining them to specific, predefined projects. This strategic approach to resource allocation is vital for the efficient management of city services and resources, reflecting the government’s commitment to addressing the diverse needs of its residents.

The Midyear Budget Review indicates that, as of December 31, 2025, the majority of General Fund revenues have achieved 46% of the estimated amount, while expenditures have reached 53%, slightly exceeding the original budget projections. This minor overage is anticipated to self-correct as the fiscal year progresses, primarily due to the reconciliation and payment of several expenses during the initial six months. As we approach year-end, we expect this preliminary overrun to stabilize, which reflects the adaptive and practical nature of our budget management practices.

T itle P roposed F unding S ource General F und Other F unds T otal B eechnut P ark P roject G eneral F und C apital R eserve $98,000 $98,000 C lean W ater P rogram S upport S tormwater F und $23,000 $23,000 A nimal C ontrol G eneral F und $76,000 $76,000
"S hop Hercules" Y iftee G ift P rogram G eneral F und $25,000 $25,000 G rant W riting G eneral F und $50,000 $50,000
T otal $249,000 $23,000 $272,000
B udg et Impact
130
3 I. General Fund Revenues
As of December 31, 2025, the General Fund's operating revenues totaled $9.5 million, representing 46% of the adopted budget for FY 2025-26. It is essential to recognize that most revenue from vehicle license fees and business licenses is received after this date, as vehicle license fee revenue is not remitted to the City until February, and the deadline for business license renewals is January 31. This timeframe explains the observation of revenues falling below 50% at the end of December. Additionally, program-fee revenues often fluctuate annually; however, these variations are offset by the corresponding program expenditures.

Below is a chart of General Fund revenues, followed by an analysis of the major General Fund revenues:

Approximately 79% of the General Fund's revenues are derived from various general taxes. This substantial funding is heavily reliant on economically sensitive sources, such as sales taxes and utility user taxes. The stability of these key revenue streams is closely linked to the overall economic climate. As a result, any shortfall or fluctuations in these areas could have serious implications for the financing of future programs and essential services. Therefore, it is imperative to ensure a consistent flow of funds from these sources to maintain the City's financial health and effectively address community needs.

 Utility Users Tax (UUT)
The City imposes a utility users’ tax (UUT) on the consumption of various utility services, including electricity, gas, water, telephone, and cable. The City determines the tax rate. Currently, the UUT rate in Hercules stands at 8%, which is crucial to funding ess ential City services and accounts for approximately 20% of General Fund revenues.

T axes
79%
P rogram
R evenues
10%
Cost A llocation
4%
Investment
Income
5% Other R evenues
2%
131
4 As of December 31, 2025, the City has collected $2.1 million, representing 51% of the estimated fiscal-year revenue. These funds are remitted to the City monthly. Given the collections achieved to date, estimated revenue from UUT is on track to meet projected targets.

 Sales Tax
The City collects a tax on the sale of certain goods and services. This tax is the largest source of revenue for the General Fund, accounting for 28% of its total revenues. It is remitted to the City by the State every month.

As of December 31, 2025, the City has collected $3.2 million, representing 54% of the estimated fiscal-year revenue. This collection suggests that sales tax revenue is on track to meet its targets. It is important to note that sales tax revenues are concentrated among a few major operators and are primarily derived from business -to-business transactions. The top three contributors account for over 50% of the City's total sales tax revenue. If any of these key revenue sources fall short of projections, it could negatively impact funding for future programs and services.

 Property Taxes
As of December 31, 2025, the City has collected approximately $1.2 million, representing 69% of projected revenue. Property taxes in Hercules are relatively low in comparison to many neighboring Bay Area cities, primarily due to a historical and permanent reduction in revenue allocation resulting from Proposition 13, enacted in 1978. Importantly, the City's share of the base 1% property tax rate remains below that of many other jurisdictions, accounting for just over 5% of Hercules's total base property taxes.

 Vehicle License Fee (VLF)
In addition to the standard allocation of property taxes, cities and counties receive property tax revenues in lieu of Vehicle License Fees (VLF). In 2004, the Legislature implemented a permanent reduction in the VLF rate from 2 percent to 0.65 percent, offsetting the revenue loss to cities and counties with an equivalent dollar-for-dollar increase in property tax allocations. Each agency’s property tax allocation in place of VLF is adjusted annually in accordance with the growth in gross assessed valuation within that specific city or county.

The City receives this allocation from the County biannually, in February and June. According to our consultant's estimates, the City is expected to receive approximately $2.6 million by the end of this fiscal year.

 Business License Fees
A business license fee is an annual tax mandated by the city for the legal operation of a business. In Hercules, this tax is determined by the industry's 132
5 specific nature. Existing businesses must renew their licenses each year.

Payments are generally due by January 1st, with a grace period extending until January 31st. The fee structure typically consists of a base amount plus a state-mandated $4 fee.

 Other taxes and revenues
The summary indicates that several revenue streams are currently collecting less than 50% of their expected revenue, primarily due to the timing of receipt . However, a review of month -to-month trends from the previous year shows that overall General Fund revenues are aligning with our fiscal targets for this year. This outcome suggests a positive trajectory and a stable financial outlook, despite some areas underperforming at midyear.

II. General Fund Expenditures
The General Fund allocates its annual resources to a range of essential services vital to the community's functioning and improvement. These services include public safety provided by the police department, recreational opportunities and green spaces throu gh the parks and recreation department , urban and community development initiatives, and infrastructure maintenance and enhancement through public works. Additionally, it supports the administrative functions required for effective governance. These allocations help create a safe, vibrant, and well-organized community environment.

As of December 31, 2025, the operating expenditures of the General Fund have reached $11 million, accounting for 53% of the adopted budget for fiscal year 2025-26. It is important to highlight that insurance premiums for General Liability and Workers' Compensation are due at the start of the fiscal year. Furthermore, park and recr eation expenses are primarily driven by the number of activities offered in each program and are seasonal. As a result, expenditures in these specific categories have surpassed 50% as of December 31, 2025.

The mid -year budget review provides an opportunit y to suggest necessary changes to the adopted budget and implement required modifications. Generally, 133
6 introducing new initiatives or programs during this review is discouraged unless deemed essential, ensuring that resources are allocated prudently. Details of the proposed budget adjustments are in Attachment 2.

III. General Fund Operating Reserve
Fiscal stability is a fundamental aspect of effective city management. Responsible financial stewardship includes the practice of maintaining adequate reserve funds to address both anticipated and unforeseen circumstances. The City has established a policy requiring operating reserves equal to 25% of total operating expenditures. Consequently, the General Fund complies with this standard, ensuring that the operating reserve represents 25% of the total operating budget.

Non-General Fund Programs
Funding for essential initiatives, such as transportation improvements, the gas tax, and the Measure C "Street Fund," is secured through various grants and dedicated funding streams.

Each of these funding sources is subject to specific restrictions that necessitate meticulous tracking of revenues and expenditures. This process ensures that the funds are maintained separately from the City's primary operating fund, the General Fund. For a comprehensive summary of non -general fund financials as of December 31, 2025, ple ase refer to Attachment 4.

Currently, funds and appropriations are available to support the ongoing development of projects and programs. This financial stability also enables the implementation of the proposed mid-year adjustments detailed in Attachment 2.

It is essential to note that the Victoria by the Bay Lighting and Landscaping Assessment District (LLAD) is designed to carry a deficit for 10 years, as established by the voter - approved assessment increase. As of December 31, 2025, the accumulated deficit reported for the Victoria by the Bay LLAD is approximately $900,000.

Next Step
Staff is preparing the FY 2026-27 budget with a series of recommended budget workshops.

The table below outlines the tentative Council meeting dates on which budget information will be provided.

Date Action/Topic
March 24, 2026 Budget Workshop: 10-Year Capital Improvement Projects (CIP) May 12, 2026 Budget Workshop: Preliminary draft of the Proposed FY 2026-27 Annual Operating Budget
June 9, 2026 First Publc Hearing and Introduction of the FY 2026-27 Annual Budget and 10-Year CIP
June 23, 2026 Second Public Hearing and Adoption of the FY 2026-27 Annual Budget and 10-Year CIP
134
7 Budget Award
The City of Hercules is proud to announce that its Fiscal Year 202 5-2026 Budget has received the Distinguished Budget Presentation Award from the Government Finance Officers Association (GFOA) and Operating Budget Excellence Award from the California Society of Municipal Finance Officers (CSMFO) for the fifth consecutive year . These prestigious awards signify the highest level of recognition in government budgeting and underscore the City’s comm itment to transparency, accountability, and excellence in financial planning. This achievement is a testament to the hard work and dedication of the entire organization.

FISCAL IMPACT:

The proposed budget amendment for the fiscal year 2025-26, detailed in Attachment 2, is expected to have a financial impact of $249,000 on the General Fund and $23,000 on the Stormwater Fund. It is important to note that both funds possess sufficient resources to accommodate these expenditures. This amendment is strategically designed to enhance our financial planning while ensuring the continued provision of essential services and the advancement of infrastructure initiatives.

ATTACHMENTS:

1. Budget Resolution

2. Budget Request Detail

3. General Fund Summary

4. Non-General Fund Summary
135

HERCULES CITY COUNCIL
RESOLUTION NO. _____

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES ADOPTING THE FY 2025-26 MIDYEAR BUDGET APPROPRIATIONS

WHEREAS, on June 10, 2025, the City Council formally adopted the FY 2025-26 Budget, which serves as a strategic financial framework for the effective management of the City's operations. This budget underscores our dedication to supporting sustainable growth, enhancing public services, and promoting the overall welfare of our community; and

WHEREAS, the recommended appropriations have been carefully evaluated and reviewed by the City Manager and the Finance Director. A detailed budget amendment proposal is included i n Attachment 2 of the accompanying staff report for your consideration; and

WHEREAS, the staff is seeking approval for the appropriations for fiscal year 2025 -26, as detailed in Attachment 2. This request aims to ensure that our financial resources are effectively allocated to meet our strategic objectives and enhance operational efficiency ; and

NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Hercules as follows:

1. The City Council hereby approves the FY 2025-26 Midyear Budget appropriations 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 24th day of February 2026, by the following vote of the Council:

AYES:

NOES:

ABSENT:

ABSTAIN:
____________________________
Chris Kelley, Mayor
ATTEST:

Eibleis Melendez, City Clerk

136

CITY OF HERCULES
FY 25-26 MIDYEAR ADJUSTMENTS - LIST OF ADDITIONAL BUDGET REQUEST Title
Proposed
Funding
Source
Department Description Justification General Fund Other Funds Total Beechnut Park Project General Fund
Capital
Reserve
Public Works Allocate additional funding from the General Fund Capital Reserve to address the project budget
shortfall, ensuring the project can proceed as
planned based on the actual bid amounts received.

This budget amendment will fully fund the design,
construction, construction management, and
contingency for this project.
$98,000
$98,000
Clean Water Program Support Stormwater
Fund
Public Works Revise the Clean Water Program Budget to ensure complete funding for the Clean Water Program
Support contract for fiscal year 2025-2026.

The costs of the Clean Water Program have risen
due to its expanding scope and complexity. To
support the contract and reinforce our commitment
to maintaining and improving water quality
initiatives, additional funding is necessary. This
funding is crucial for advancing our environmental
goals and ensuring the program's vital services
continue to function effectively.
$23,000
$23,000
Animal Control General Fund Public Works It is essential to revise the budget to accommodate the rate increase established by Contra Costa
County after the FY 25-26 budget was adopted.

This adjustment is crucial for maintaining the
continuity of animal control services.
$76,000 $76,000
"Shop Hercules" Yiftee Gift
Program
General Fund Community
Development
Allocate additional funding from the General Fund to
the Yiftee Gift Program.

At its January 27, 2026 meeting, the City Council
received a report on the Yiftee program and
requested that staff return with an agenda item to
approve the addition of $25,000 in Yiftee funding, to
be released at quarterly intervals, with a 25% bonus
on gift card purchases, a maximum card value of
$200, and a maximum of 1 card purchase per user
per quarter.
$25,000
$25,000
Grant Writing General Fund City Manager Add funding to amend the professional agreement with California Consulting Services for on-call grant
writing services.

The objective of the additional funding is to continue
the City's capability to pursue and secure various
grants effectively. This initiative is intended to
advance the City's core priorities by optimizing the
utilization of grant funds.
$50,000 $50,000
Total $249,000 $23,000 $272,000
-
Budget Impact
137
General Fund
Fund Summary - 100
Fund Description / Budget Highlights
Fund Activity
FY 23-24 FY 24-25
Actual Actual Adopted
Budget
6 Months
Actual
%
Used
Revenues
Taxes
Utility User Tax 4,011,166 4,212,443 4,202,000 2,132,511 51% Sales Tax 5,753,278 5,669,937 5,890,000 3,160,029 54% Property Taxes 1,658,630 1,732,725 1,674,000 1,161,138 69% Franchise Fees 972,391 918,508 1,382,000 560,111 41% Business Licenses 292,733 298,849 282,000 44,829 16% Transfer Tax 90,359 82,236 153,000 61,968 41% Transient Occupancy Tax 29,590 201,833 245,000 127,987 52% Vehicle License Fee (VLF) and Other
Intergovernmental
2,650,830 2,708,899 2,763,000 55,451 2% Fines & Forefeitures 34,409 37,136 40,000 18,241 46% Program Revenues -
Community Development 224,004 405,978 292,400 84,132 29% Parks and Recreation 1,648,866 1,741,983 1,649,000 816,766 50% Police 88,348 144,124 97,000 51,090 53% Public Works 32,054 50,454 31,000 6,480 21% Other 6,377 13,567 10,000 15,107 151% Investment Income 1,412,799 1,563,434 991,100 525,747 53% Tower & Property Lease 210,368 316,123 218,000 189,309 87% Cost allocated to other funds 667,863 791,929 785,968 399,184 51% Transfers In 156,727 176,556 186,159 123,602 66% Total Ongoing Revenues 19,940,792 21,066,714 20,891,627 9,533,682 46% Expenditures
Police 9,043,290 9,309,187 9,635,424 4,787,116 50% Public Works 432,333 467,392 443,381 222,627 50% Community Development 719,579 1,003,801 1,104,239 459,732 42% Parks and Recreation 2,673,550 2,873,344 2,700,746 1,636,108 61% City Council 305,915 332,370 356,144 168,163 47% City Manager 525,815 555,456 553,611 284,981 51% Human Resources 465,665 544,989 599,922 272,310 45% Legal 223,043 206,188 255,000 101,584 40% City Clerk 339,370 438,872 537,496 255,126 47% Finance 1,342,588 1,445,387 1,458,595 695,472 48% Workers Comp/General Liability 1,480,421 2,094,798 1,757,019 1,416,152 81% 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.

FY 25-26
138
General Fund
Fund Summary - 100
Fund Description / Budget Highlights
Fund Activity
FY 23-24 FY 24-25
Actual Actual Adopted
Budget
6 Months
Actual
%
Used
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.

FY 25-26
Non-Department 260,000 284,756 260,000 130,000 50% Transfers Out (Debt Service Obligations) 799,213 803,278 806,291 403,146 50% Total Ongoing Expenditures 18,610,782 20,359,818 20,467,868 10,832,517 53% Net Annual Activity
Ongoing Operations 1,330,010 706,896 423,759$ One-Time Revenues 731,717 1,099,408 -
One-Time Expenditures (991,639) (1,103,771) - Outstanding Encumbrances (626,897) (565,165) - Annual - Surplus (Deficit) 443,191 137,368 423,759 Transfer to Reserve (per Council Policy)
Operating Reserve 25% 110,798 34,342 105,940 Section 115 Trust (Pension) 25% 110,798 34,342 105,940 Capital Projects 50% 221,595 68,684 211,879 443,191 137,368 423,759
Operating Reserve:

Beginning Balance 4,326,140 4,610,007 4,820,534$ Current Year Contribution 110,798 34,342 105,940 Interest Income 173,069 345,393 148,000
Ending Balance 4,610,007$ 4,989,742$ 5,074,474$
% of Operating Expenditures 25% 25% 25%
139
General Fund
Expenditure by Category
FY 23-24 FY 24-25
Actual Actual Adopted
Budget
6-Month
Actual
% Used
Expenditures by Category
Police
Salaries & Benefits 6,730,648 6,803,554 7,536,154 3,754,386 50% Contractual Services 1,089,136 1,200,396 853,671 408,285 48% Other Operating Expenditures 433,327 415,333 329,188 166,240 51% Cost Allocation 790,179 889,904 916,411 458,206 50% 9,043,290 9,309,187 9,635,424 4,787,117 50% Public Works
Salaries & Benefits 35,457 37,086 40,107 21,736 54% Contractual Services 252,702 320,169 278,500 140,074 50% Other Operating Expenditures 54,853 16,163 27,900 12,380 44% Cost Allocation 89,320 93,974 96,874 48,437 50% 432,332 467,392 443,381 222,627 50% Community Development
Salaries & Benefits 375,188 547,487 606,924 306,321 50% Contractual Services 249,835 279,325 378,887 94,063 25% Other Operating Expenditures 11,779 83,296 21,924 11,096 51% Cost Allocation 82,777 93,693 96,504 48,252 50% 719,579 1,003,801 1,104,239 459,732 42% Parks & Recreation
Salaries & Benefits 1,847,313 2,116,581 1,879,831 1,259,112 67% Contractual Services 423,759 318,511 367,628 148,619 40% Other Operating Expenditures 95,495 162,474 103,100 53,283 52% Cost Allocation 306,983 275,778 350,187 175,094 50% 2,673,550 2,873,344 2,700,746 1,636,108 61% City Council
Salaries & Benefits 75,146 69,775 63,000 42,675 68% Contractual Services 22,923 27,053 42,400 7,745 18% Other Operating Expenditures 30,922 42,004 51,400 18,071 35% Cost Allocation 176,924 193,538 199,344 99,672 50% 305,915 332,370 356,144 168,163 47% City Manager
Salaries & Benefits 295,895 315,165 331,994 177,282 53% Contractual Services 132,659 136,309 101,400 48,293 48% Other Operating Expenditures 23,320 21,247 35,000 16,797 48% Cost Allocation 73,941 82,735 85,217 42,609 50% 525,815 555,456 553,611 284,981 51% Human Resources
Salaries & Benefits 124,899 313,961 440,636 216,312 49% Contractual Services 289,654 155,780 86,400 28,960 34% Other Operating Expenditures 8,163 26,330 22,500 1,845 8% Cost Allocation 42,949 48,918 50,386 25,193 50% 465,665 544,989 599,922 272,310 45% Legal
Contractual Services 223,043 206,188 255,000 101,584 40% 223,043 206,188 255,000 101,584 40% FY 25-26
140
General Fund
Expenditure by Category
FY 23-24 FY 24-25
Actual Actual Adopted
Budget
6-Month
Actual
% Used
Expenditures by Category
FY 25-26
City Clerk
Salaries & Benefits 214,886 254,931 271,048 173,471 64% Contractual Services 24,306 77,240 143,600 28,365 20% Other Operating Expenditures 24,212 21,606 35,200 9,466 27% Cost Allocation 75,966 85,095 87,648 43,824 50% 339,370 438,872 537,496 255,126 47% Finance
Salaries & Benefits 663,783 686,191 713,338 388,994 55% Contractual Services 259,902 389,493 297,800 109,381 37% Other Operating Expenditures 274,338 209,259 282,200 114,468 41% Cost Allocation 144,566 160,444 165,257 82,629 50% 1,342,589 1,445,387 1,458,595 695,472 48% Worker's Compensation/General Liability
Salaries & Benefits 31,760 33,660 35,619 20,491 58% Contractual Services 1,448,661 2,061,138 1,721,400 1,395,660 81% 1,480,421 2,094,798 1,757,019 1,416,151 81% Non-Departmental
Debt Service - CalHFA 200,000 200,000 200,000 100,000 50% SOMAR benefit payments 60,000 84,756 60,000 30,000 50% 260,000 284,756 260,000 130,000 50% Transfers Out
Engie Equipment Lease 235,897 235,026 245,079 122,540 50% Debt Service - 2020 PFA Lease Revenue
Refunding Bonds
563,316 568,252 561,212 280,606 50% 799,213 803,278 806,291 403,146 50% Total, On-going Expenditures 18,610,782 20,359,818 20,467,868 10,832,517 53% 141
General Fund
Reserve
Available Cash
Balance
Surplus
Allocation
Remaining
Balance
Allocation to
CIP
Projected
Surplus
Allocation*
Projected
Interest
Income*
One-Time
Expenses
Approved, Via
Resolution
Midyear
Budget
Amentments
Projected,
Remaining
Balance
Cash Balance as of June 30, 2025 31,360,706$ 31,360,706 Current Liabilities (2,975,069) (2,975,069)
Contingency (2,210,419) (2,210,419)
Net, Cash Balance as of June 30, 2025 26,175,218 26,175,218 Section 115 Trust for Pension 2,608,919 34,342 2,643,261 105,940 2,749,201 General Fund Set-Aside:

Former RDA Negative Cash 3,400,000 3,400,000 3,400,000 Programs and Projects 4,200,238 4,200,238 (452,612) (223,250) 3,524,376 General Fund Reserve or Designations:

Reserve for Earthquake Insurance Deductible 500,000 500,000 500,000 Reserve for Capital Projects 4,531,364 68,683 4,600,047 (2,923,720) 211,879 (118,620) (249,000) 1,520,586 Reserve for Reusable Bags (remaining) 13,930 13,930 13,930 Reserve for PEG Fees 328,000 328,000 328,000 Reserve for Economic Uncertainty (25% target) 4,955,400 34,342 4,989,742 105,940 148,000 5,243,682 Reserve for Hercules HUB (Local Match) 3,000,000 3,000,000 3,000,000 Partial payment to CalHFA loans 2,500,000 2,500,000 2,500,000 Total, General Fund Reserves 26,037,851 137,367 26,175,218 (2,923,720) 423,759 148,000 (452,612) (341,870) (249,000) 22,779,775 * The projected operating surplus and interest income for FY 25-26 may change based on actual annual results.

FY 24-25 FY 25-26
142

NON-GENERAL FUND SUMMARY
As of December 31, 2025
Special Revenue Funds
Beginning
Available Balance Revenue Expenditures Midyear Request Net Activities Ending Balance Fund No. Fund Name Actual Budget 6-Month Actual % Budget 6-Month Actual % Adjustments As of 12/31/2025 As of 12/31/2025 101 ASSET SEIZURE 167,857 - - 100,000 8,686 9% (8,686) 159,171 201 AB 3229 COPS Program 80,823 150,000 166,382 111% 186,159 - 0% 166,382 247,205 220 CITYWIDE L&L DIST 83-2 908,694 2,351,768 712,067 30% 2,199,033 715,667 33% (3,599) 905,095 221 VICTORIA BY THE BAY L&L (859,842) 590,212 317,217 54% 728,080 373,572 51% (56,355) (916,197) 222 HERCULES VILLAGE L&L DIST 109,877 188,241 100,927 54% 245,104 120,502 49% (19,575) 90,302 223 BAYWOOD ASSESS 04-1 L&L 86,962 186,035 100,467 54% 185,981 85,270 46% 15,197 102,159 224 BAYSIDE ASSESS DIST L&L 116,766 170,209 91,982 54% 169,187 69,564 41% 22,418 139,184 225 ARTERIAL ROADWAYS 515,191 349,928 - 0% 376,790 207,450 55% (207,450) 307,742 231 STORMWATER ASSESSMENT 17,320 375,000 272,952 73% 392,606 212,964 54% 59,987 77,308 241 DIF-GEN PUBLIC FACILITIES 203,003 - 1,208 - - 1,208 204,212 242 COMMUNITY DEVELOPMENT FND 249,564 - 2,112 - - 2,112 251,676 243 DEVELOPMENT FEE FUND 80,606 - - - - - 80,606 244 DIF-POLICE FACILITIES 356,528 - 2,143 - 9,216 (7,073) 349,455 246 DIF-FIRE FACILITIES 1,763 - - - - - 1,763 247 DIF-PARK & REC 236,979 - 2,493 150,000 - 2,493 239,471 249 PUBLIC BENEFIT FEE 1,093,451 - - - - - 1,093,451 261 DIF-TRAFFIC FACILITIES 749,373 - 8,736 - - 8,736 758,109 262 STATE GAS TAX FUND 549,181 738,148 386,391 52% 754,459 255,580 34% 130,810 679,992 263 MEASURE "C" STREET FUND 776,021 493,303 - 0% 612,868 257,704 42% (257,704) 518,316 266 BART (PARK & RIDE) 6,779 92,000 33,000 36% 92,000 19,879 22% 13,121 19,900 267 GENERAL PLAN UPDATE 1,608,945 - 95,492 1,300,000 5,428 90,064 1,699,009 268 SB1 (RMRA) 1,692,994 683,809 366,326 500,000 - 0% 366,326 2,059,320 291 SOLID WASTE AND RECYCLING 965,496 - 89,532 381,852 7,454 2% 82,078 1,047,575 387 WATER QUALITY RET BASIN 359,415 63,000 34,321 54% 49,000 8,533 17% 25,788 385,204 521 REGIONAL WATER QUALITY 57,962 - - - - - 57,962 640 SUCCESSOR HOUSING 6,188,900 - 17,329 120,595 39,437 33% (22,108) 6,166,792 16,320,609 6,431,653 2,801,078 44% 8,543,714 2,396,905 28% - 404,173 16,724,783 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.

FY 2025-26 MIDYEAR BUDGET REPORTNON-GENERAL FUND
143

NON-GENERAL FUND SUMMARY
As of December 31, 2025
Enterprise Funds
Beginning
Available Cash
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 of 12/31/2025 As of 12/31/2025 420 WASTEWATER - OPERATION 16,317,500 7,200,934 4,267,778 59% 10,080,152 2,027,708 20% 2,240,070 18,557,570 421 WASTEWATER - CAPITAL - 536,680 - 0% 536,680 - 0% - - 16,317,500 7,737,614 4,267,778 55% 10,616,832 2,027,708 19% - 2,240,070 18,557,570 Internal Service Funds
Beginning
Available Cash
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 of 12/31/2025 As of 12/31/2025 450 VEHICLE REPLACEMENT FUND 279,651 163,000 - 0% - - - 279,651 460 IT OPERATING FUND 780,554 1,102,852 553,588 50% 1,141,997 840,242 74% (286,655) 493,899 470 FACILITY MAINTENANCE FUND 119,879 1,047,125 523,563 50% 1,201,184 638,692 53% (115,130) 4,750 480 IT REPLACEMENT FUND 360,895 292,000 - 0% 300,000 111,869 37% (111,869) 249,026 490 FACILITY REPLACEMENT FUND 247,669 - - - - - 247,669 1,788,648 2,604,977 1,077,150 41% 2,643,181 1,590,803 60% - (513,653) 1,274,995 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.

These funds account for activities related to vehicle replacement, IT equipment replacement, and facilities maintenance.

NON-GENERAL FUND FY 2025-26 MIDYEAR BUDGET REPORT
144

NON-GENERAL FUND SUMMARY
As of December 31, 2025
Debt Service Funds
Beginning
Available Cash
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 of 12/31/2025 As of 12/31/2025 672 2003B DEBT SERVICE PFA 4,568 561,212 - 0% 561,212 - 0% - 4,567.84 673 2009 DEBT SERVICE PFA 2,281,009 906,578 - 0% 906,578 - 0% - 2,281,009 388 EQUIPMENT LEASE - 245,079 245,079 100% 245,079 245,079 100% - - 2,285,577 1,712,869 245,079 14% 1,712,869 245,079 14% - - 2,285,577 Capital Projects Funds
Beginning
Available Cash
Balance Revenue Expenditures Midyear Request Net Activities Ending Available
Balance
Fund No. Fund Name Actual
Budget, As
Amended 6-Month Actual % Budget 6-Month Actual % Adjustments As of 12/31/2025 As of 12/31/2025 295 FEDERAL GRANTS - - - 0% - - 0% - -
296 STATE GRANTS - 190,500 1,189 0% 190,500 1,189 1% - - 300 CITY CAPITAL PROJ-SINGLE 2,460,930 2,923,720 2,923,720 100% 2,923,720 555,758 19% 2,367,962 4,828,892 354 HERCULES HUB - 2,239,000 400,453 0% 2,239,000 400,453 18% - - 2,460,930 5,353,220 3,325,362 62% 5,353,220 957,400 18% - 2,367,962 4,828,892 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.

NON-GENERAL FUND FY 2025-26 MIDYEAR BUDGET REPORT
145

DISCUSSION AND/OR ACTION ITEM

AGENDA ITEMS

2. 26-054
146

STAFF REPORT TO THE CITY COUNCIL

DATE: Regular Meeting of February 24, 2026
TO: Mayor and Members of the City Council
VIA: Dante Hall, City Manager
SUBMITTED BY: Glenn Dombeck, Public Works Director/City Engineer Christopher Roke, Parks and Recreation Director
SUBJECT: Contract Amendment No. 2 to the Professional Services Agreement with Gates & Associates, Inc. for Final Design of Beechnut Park Improvement Project
RECOMMENDED ACTION:

BACKGROUND:

The City is in the process of finalizing construction documents for a park improvement project to improve the use and accessibility of Beechnut Park. The park is designated for use by local neighborhood families and can accommodate up to 54 children and ten adults. Existing playground facilities are not accessible in accordance with ADA standards. Existing trees are in poor condition, with branches exhibiting signs of limbing, and the landscape area is presently vacant and devoid of plantings.

Beechnut Park is located on a 6-acre parcel bounded by Refugio Valley Road, Beechnut Drive, and Coronado Street. It is accessed from Coronado Street by a concrete pathway and from a parking lot off Beechnut Drive. The parking lot has been unused for many years and is believed to have been constructed to access the model homes and sales office when the surrounding neighborhood was developed. Existing amenities in the park area are sparse and include a concrete walkway, sand playground with 2 swings, several 147
benches, a trash can, and streetlight, all of which are worn out and in need of replacement.

The City entered into a contract with Gates & Associates (Gates), who are on the City’s pre-approved vendor list, in November 2023 to complete the conceptual design of the park. The contract was later amended to fac ilitate additional meetings and develop additional concepts for park uses. As part of this initial design phase, a PG&E easement for overhead transmission lines that run over the site was revised and approved by the California Public Utilities Commission in August 2025 to allow for the installation of new structures, including play equipment. Community input, solicited from an on -line survey with 172 participants and a May 2024 pop -up event , centered on the Play Area with Design Option 3 shown below as the clear favorite.

The design concept consists of demolition of the existing swing set, playground surfacing and trees surrounding the playground and construction of new playground equipment and surfacing, a new picnic table and benches and landscaping. The new play area will be suitable for children aged 5 to 12, will include an ADA accessible ramp, and incl udes a cyclone based climber and swing set. The Beechnut playground construction work will be included in a construction contract that will occur later in fiscal year (FY) 2026 -27 addressing renovation of the playground equipment and surfacing at Beechnut Park.

148
ANALYSIS:

Additional funding, via a second amendment to the November 2023 Professional Services Agreement with Gate s, is needed to finalize the playground and park design. This includes development of landscaping plans, playground layouts, civil dr awings and irrigation drawings and details. The additional services also include costs for assistance during the bidding phase and construction administration. The contract also reimburses the designer for modifications to the irrigation system, miscellane ous site plan adjustments, and bid assistance and construction administration for the Refugio and Foxboro Park Improvement Project.

The project is categorically exempt from the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines Section 15301, Existing Facilities, which consists of the operation, repair, maintenance, permitting, leasing, licensing, or minor alteration of existing public or private structures, facilities, mechanical equipment, or topographical features, involving negligible or no expansion of existing or former use.

FISCAL IMPACT:

Funding for the design work addressed by this contract amendment is available in the Adopted FY 25-26 Budget. The construction cost for the park improvements (excluding design costs, c ontingency, and construction management ) is estimated at $346,000. Sufficient funding is currently available for th ese improvements and will be verified prior to award of the construction contract.

ATTACHMENTS:

Attachment 1 - Resolution
Attachment 2 - Amendment No. 2 to the November 6, 202 3 Professional Services Agreement with Gates & Associates, Inc.

149

HERCULES CITY COUNCIL
RESOLUTION NO. _________

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES ,

CALIFORNIA, AUTHORIZING THE CITY MANAGER TO EXECUTE AN AMENDMENT NO. 2 TO THE CITY’S NOVEMBER 6, 202 3 PROFESSIONAL SERVICES AGREEMENT WITH GATES & ASS OCIATES, INC. TO PROVIDE DESIGN

SERVICES FOR THE BEECHNUT PARK IMPROVEMENT PROJECT, INCREASING THE COST BY $84,534 TO A TOTAL COST OF $136,329.

WHEREAS, On November 6, 202 3, the city entered into an agreement in the amount of $ 43,890 for professional ser vices with Gates & Associates, Inc. (Gates) to hold a community meeting and prepare the 30 percent design of the Beechnut Park Improvement Project; and

WHEREAS, On August 21, 2024, the city entered into Amendment No. 1 to the November 6, 202 3 agreement in the amount of $7,905 to provide additional coordination and community meetings for the Beechnut Park Improvement Project; and

WHEREAS, On August 6, 202 5, the city entered into an Encroachment Agreement with Pacific Gas and Electric allowing the construc tion of a playground within the Easement and Right of Way for the electric transmission facilities that cross the site.

WHEREAS, The City anticipates continued need for Gate’s services to complete the project design and support management of the construction for this project; and

WHEREAS, funding for the design work is available in the Fiscal Year 2025-26 Adopted Budget.

NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Hercules as follows:

1. The City Council hereby authorizes the City M anager to execute an Amendment No. 2 to the November 6, 2023 Professional Services Agreement with Gates & Associates, Inc. to provide design services for the Beechnut Park Improvement Project, increasing the cost by $84,534 to a total cost of $136,329.

The foregoing Resolution was duly and regularly adopted at a regular meeting of the City Council of the City of Hercules held on the 24th day of February, 2026 by the following vote of the Council:

AYES:

NOES:

ABSTAIN:
150

ABSENT:

____________________________
Chris Kelley, Mayor

ATTEST:

________________________________
Eibleis Melendez, City Clerk
151
Original Agreement No. 23-076-CM
Council Resolution No.__________
63063 - Beechnut Park Project
AMENDMENT NO. 2

1. Parties. The parties to this Contract Amendment are the City of Hercules, a public body corporate and the following named Contractor:

David L. Gates and Associates dba Gates + Associates
1655 N. Main Street, Ste 365, Walnut Creek, CA 94596
(925) 736-8176
Attn: Chuck Gardella
[email protected]

The parties to this Contract Amendment do mutually agree and promise as follows:

2. Purpose. This Amendment No. 2 is being entered into to amend an existing contract between the City and Contractor which was approved by the City Manager of the City of Hercules on November 6, 2023. Said contract shall her einafter be referred to as the "Original Contract" and is incorporated herein by reference.

The additional scope is summarized in Attachment A -1: Scope of Services, and the additional compensation is summarized in Attachment B -1: Payment, which are incorporated into the Amended Contract. Attachment A and Attachment B remain in full force and effect, are not amended by this Amendment No 2, and are part of the Amended Contract."

5. Amendment Approval: This Amendment No. 2 is hereby approved by the City Council of the City of Hercules on this 13
th day of January, 2026.

6. Signatures. These signatures attest the parties' agreement hereto:

City of Hercules

s/_______________________________
Dante Hall, City Manager

Date: ___________________________

Approved as to form:

By ______________________________
Christie Crowl, City Attorney
Contractor: Gates + Associates

s/_______________________________

_________________________________
Name/Title

Date: ___________________________

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Attachments:

Attachment A-1: Scope of Service
Attachment B-1: Payment
153
Attachment A-1

SCOPE OF SERVICES
City of Hercules
Beechnut Park Project Amendment No. 2

Maintenance Services Agreement Agreement No. 23-076-CM City Attorney Approved, 03112024 Scope of Services

SCOPE OF SERVICES

The project shall involve continuous development of Construction Documents package to bid set. CPUC and PG&E have already provided approvals.

Gates Studio

TASK 1 – CONSTRUCTION DOCUMENTS

The objective of this task is to provide final Contract Documents for public bid and construction.

Subtask 1.1 – 90% PS&E

• Based on the City’s decision on the play structures and playground surfacing material, prepare 95% Plans including:
o Cover sheet and general notes
o Planting Plan
o Layout Plan
o Construction details (Planting, site furniture, surfacing, fencing, play area access ramps, park sign, play structure). Structural engineering and calculations are excluded.
• Prepare the engineer’s estimate of probable construction costs to 90% and determine bid alternates
• Provide 90% technical specifications for playground equipment, surfacing, and fencing, in City format:
• Provide project management and coordination of Design Team, plans, specs, and estimates (PS&E)
• Perform Quality Control review of entire plan set
• Conduct coordination meetings.

Subtask 1.2 – 100% PS&E

• Virtually meet with City staff, to review City comments on the 90% PS&E package.
• Provide written response matrix to City’s comments on the 90% PS&E package. • Based on City comments to the 90% PS&E package, update set to 100% Plans • Update the engineer’s estimate of probable construction costs to 100%. • Update the technical specifications to 100%.
• Provide project management and coordination of Design Team, plans, specs, and estimates (PS&E)
• Perform Quality Control review of entire plan set.
• Conduct coordination meetings.
154
Attachment A-1

SCOPE OF SERVICES
City of Hercules
Beechnut Park Project Amendment No. 2

Maintenance Services Agreement Agreement No. 23-076-CM City Attorney Approved, 03112024 Scope of Services

Subtask 1.3– BID SET

• Virtually meet with City staff, to review City comments on the 100% PS&E package.
• Based on City comments to the 100% PS&E package, update all plans and specifications for Bid.
• Perform Quality Control review of entire plan set.

Deliverables:
90% & 100% PS&E, Bid Documents
Meetings: Virtual (4)

TASK 2 – BID ASSISTANCE

The objective of this task is to provide responses to contractor questions during the bid process and provide a final set of Conform Contract Documents.

Subtask 2.1 – Bid Assistance

• Assist the City with responses to bidder’s inquiries through the City’s Project Manager.
• Assist the City with addenda to the construction documents as needed to respond to bidder’s inquiries and clarify the intent of bid documents. • Assist the City in evaluating bids

Subtask 2.2 – Conform Documents

• Prepare and submit a conformed set of contract documents incorporating all addenda

Deliverables:

Addenda, Conform Contract Documents for Construction
Meetings: None

TASK 3 – CONSTRUCTION ADMINISTRATION

The objective of this task is to ensure construction is installed in conformance with the Contract Documents.

Subtask 3.1 – Construction Administration

• Provide management and coordination of design team thru the Construction Administration process.
155
Attachment A-1

SCOPE OF SERVICES
City of Hercules
Beechnut Park Project Amendment No. 2

Maintenance Services Agreement Agreement No. 23-076-CM City Attorney Approved, 03112024 Scope of Services

• Review technical submittals, shop drawings, product data, product samples, and product warranties from the contractor for conformance with the specifications and drawings in accordance with City’s timelines and requirements. • Respond to Contractor’s Request for Information (RFI) and Request for Substitution (RFS) in accordance with City timelines.
• Prepare the Scope of Work, including sketches, for Field Instructions issued to the Contractor.
• Review Change Order (CO) pricing and provide written responses for the City’s review and finalizing said COs.
• Attend up to 8 (eight) online construction meetings

Subtask 3.2 – Construction Observation

• Attend (2) walk-throughs of the Project site
• R eview Contractor Punch List, and provide written response with status and action of items on the Punch List.
• Consultant shall attend final walk-through of the Project site with the City, verify Punch List completion, and provide written response with recommendation regarding Project acceptance and close-out.

Deliverables:

Response to RFI’s, Submittals, and Change Orders, Field Reports Meetings: Online Construction (8), Construction Observation (2)

TASK 4 – REFUGIO MODIFICATIONS

• Modifications to irrigation system Controller system
• Site Plan adjustments and alternates (painting restroom metal work, bike racks, seal coat, curbs)
• Bid Assistance & Construction Administration

ADDITIONAL SERVICES:

Additional services shall include but are not limited to the following:

• Additional meetings to those described above.
• Exclusions: Parking, Horticultural consulting and soils analysis, Arborist report, environmental permitting, PG&E permitting, County Bldg department permitting, utility permitting, electrical engineering, geotechnical engineering, structural engineering, soils testing, hazmat testing, off site work. • Boundary survey, legal descriptions, additional topography, potholing, underground locating
• Revisions to the 30% design following commencement of the Construction Documents Phase.
156
Attachment A-1

SCOPE OF SERVICES
City of Hercules
Beechnut Park Project Amendment No. 2

Maintenance Services Agreement Agreement No. 23-076-CM City Attorney Approved, 03112024 Scope of Services

• Preparation of front end (boilerplate) non-technical specifications.

CSWST2

CSWST2 understands the 30% CD is being reviewed by PG&E and CPUC for work within the utility easement. Listed below is our scope of services for preparation of civil design for the 90% and 100% CDs and bid set documents.

A description of these services includes the following.

Task 1 – 90% CDs

In this task, CSWST2 will prepare civil design plans, specifications, and estimate (PS&E) based on the landscape 30% CD plans.

1.1 Construction Plans. We will prepare the following plans commensurate with a 90% CD level.

a. Grading and Drainage Plan
b. Erosion Control Plan
c. Detail Sheet

1.2 Technical Specifications. We will prepare technical specification for the civil design improvements in a client-approved format.

1.3 Cost Estimate. We will prepare an opinion of probable construction cost for the civil design improvements for consolidation by the client into a project cost estimate.

Task 2 – 100% Construction Documents

In this task, CSWST2 will refine the civil documents into 100% PS&E based on City plan check comments.

2.1 Construction Plans. We will update the 90% CD per plan check comments to 100% CD.

2.2 Technical Specifications. We will update specifications as needed for the 100% CD.

2.3 Cost Estimate. We will update the opinion of probable construction cost for the civil design improvements.

157
Attachment A-1

SCOPE OF SERVICES
City of Hercules
Beechnut Park Project Amendment No. 2

Maintenance Services Agreement Agreement No. 23-076-CM City Attorney Approved, 03112024 Scope of Services

2.4 Response to Comments. We will provide a response to City plan check comments regarding the civil design elements in a client specified format.

Task 3 – Bid Set

Using plan check comments for the 100% PS&E, CSWST2 will prepare bid set PS&E.

3.1 Construction Plans. We will update the 100% CD per plan check comments for bidding.

3.2 Technical Specifications. We will update specifications as needed for bidding.

3.3 Cost Estimate. We will update the opinion of probable construction cost for the civil design improvements.

3.4 Response to Comments. We will provide a response to City plan check comments regarding the civil design elements in a client specified format.

Task 4: Bid Support

4.1 Bidding Addenda. Our team will assist during the bidding phase by responding to contractor requests for information, preparing bid addenda as necessary, and providing a Conform Plan set (if requested).

Task 5: Construction Administration

5.1 Review Submittals: CSW|ST2 will review and respond to contractor product submittals relating to the civil related documents.

5.2 Respond to RFI's: CSW|ST2 will review and respond to civil related contractor Requests for Information (RFI's). An allowance for up to six (6) responses has been provided.

5.3 Site Visits: CSW|ST2 will peform on-site field observations to review the progress of construction and conformance to plans as directed by the client. An allowance for two (2) visits has been provided.

5.4 Punch List: CSW|ST2 will take part in one (1) pre-punch list observation and prepare a punch list of civil related items.

5.5 Record Drawings: CSW|ST2 will prepare one (1) set of record drawings of the civil related
158
Attachment A-1

SCOPE OF SERVICES
City of Hercules
Beechnut Park Project Amendment No. 2

Maintenance Services Agreement Agreement No. 23-076-CM City Attorney Approved, 03112024 Scope of Services

site improvements, to be drafted from field mark-ups provided by the General Contractor at project completion.

Additional Services

CSW|ST2 agrees to perform all of the items listed in the Scope of Services. However, the following items are excluded from the Scope of Services of this contract. They may be added at the request of the Owner as a revision to this proposal, or under a future proposal or amendment. Fees for these services will be billed on a time and expense basis, in accordance with our then current Hourly Rates and Billing Policy, with a budget estimate provided or for a fixed fee based upon a defined scope of work. Additional items CSW|ST2 can provide include (but are not limited to):

• Response to more than 1 Round of Plan Check Comments for each phase • Hydrology and Hydraulic Study
• Storm Water Control Plans and/or Reports

RMA Irrigation

Regarding the above referenced project, please find our irrigation design service descriptions and the fee associated. All irrigation drawings will be documented in a CAD 159
Attachment A-1

SCOPE OF SERVICES
City of Hercules
Beechnut Park Project Amendment No. 2

Maintenance Services Agreement Agreement No. 23-076-CM City Attorney Approved, 03112024 Scope of Services

drafted format, and in conformance with local water conservation ordinance requirements.

Base plans, plot sheets in AutoCAD format, preferred controller and water meter location(s) and water pressure will be provided for our use by Gates + Associates.

The service descriptions are as follows:

1. Preliminary site visit: Our scope of work will include:

A. Review site conditions with maintenance staff.

B. Review existing point of connection with staff.

C. Verify static pressure at source.

D. Locate existing irrigation to remain in service.

E. Locate connection points to existing mainline, water meter, etc.

F. Inspect existing controller for compliance with State Model Water Efficient Landscape Ordinance.

G. Utilize survey grade GPS equipment to map all irrigation valves and large rotors to identify their exact locations.

2. 90% Construction Documentation: Our scope of work will include:

A. Main line layout with appropriate sizes to service remote control valves.

B. Valving of planting zones based on plant type, slope and exposure.

C. Irrigation sprinkler, bubbler, or dripline layout.

D. Lateral pipe layout with appropriate sizes to service sprinkler, bubbler or dripline.

E. Equipment legend describing the components of the design and general notes.

F. Equipment details for instructions on proper installation.

G. Irrigation Technical Specifications.

H. Irrigation Cost Estimates.

I. Water use calculations per state and local ordinances.

Note: One round of minor base change is included in the fee. After the 90% CD irrigation design has been completed. Any additional base changes that require an irrigation redesign will require additional fees and an add service proposal will be provided.

3. 100% Bid Set Construction Documentation: Our scope of work will include:

A. Revise irrigation drawings to conform to any minor changes.

B. Respond to and revise plans per two rounds of City/County comments.

C. Sizing of lateral lines.

D. Finalize irrigation equipment legend, general installation notes and details.

E. Finalize Irrigation Cost Estimates.

F. Finalize Irrigation Technical Specifications.

160
Attachment A-1

SCOPE OF SERVICES
City of Hercules
Beechnut Park Project Amendment No. 2

Maintenance Services Agreement Agreement No. 23-076-CM City Attorney Approved, 03112024 Scope of Services

4. Bidding & Negotiation: Our scope of work could include the following:

A. Respond to questions during bidding.

B. All work will be billed on an hourly basis not to exceed the amount shown.

5. Conform Set: Our scope of work will include:

A. Revise irrigation drawings to conform to any minor changes.

6. Construction Administration (if required)
A. Post Construction Observation
B. Punchlist Backcheck Observation
C. Submittal Review
D. RFI/Addendums

Reimbursable expenses: Mileage, tolls, deliveries, reproduction costs, etc. will be billed at our cost up to the amount listed.

Excluded Design Services:

A. Design per Title 22 Recycled Water (unless notice of recycled water use prior to proposal)
B. High voltage electrical (service from source to controller and/or pumps) C. Booster pumps.

D. Well design.

E. Demolition Plans
F. LEED, CAL Green and CHPS documentation.

161
Attachment B-1

PAYMENT
City of Hercules
Beechnut Park Project Amendment No. 2

Maintenance Services Agreement Agreement No. 23-076-CM City Attorney Approved, 03112024 Payment

PAYMENT

Costs for each item in the scope of services are estimated as follows:

Item Task Description Fee
Item 1 Gates Studio

1.0 Task 1 - Construction Documents

1.1 90% PS&E $12,670

1.2 100% PS&E $6,100

1.3 Bid Set $2,685

2.0 Task 2 - Bid Assistance $3,480

3.0 Task 3 - Construction Administration $9,110

4.0 Task 4 – Refugio Modifications $8,565

PRIME CONSULTANT FEE $42,610
Item 2 CSWST2

1.0 Task 1 – 90% CDs

1.1 Construction Plans $6,250

1.2 Technical Specifications $1,000

1.3 Cost Estimate $720

2.0 Task 2 – 100% CDs

2.1 Construction Plans $7,200

2.2 Technical Specifications $500

2.3 Cost Estimate $400

2.4 Response to Comments $400

3.0 Task 3 – Bid Set

3.1 Construction Plans $5,500

3.2 Technical Specifications $500

3.3 Cost Estimate $400

3.4 Response to Comments $400

4.0 Task 4 – Bid Support

4.1 Bid Addenda $1,000

5.0 Task 5 – Construction Support

5.1 Review Submittals $1,080

5.2 Respond to RFI’s $1,080

5.3 Site Visits $1,080

5.4 Punch List $540

5.5 Record Drawings $1,440
Item 3 RMA Irrigation

1.0 Preliminary Site Visit $750

2.0 90% Construction Documentation $2,400

3.0 100% Bid Set Construction Documentation $900

4.0 Bidding & Negotiation $450

5.0 Conform Set $900

6.0 Construction Administration

6.1 Post Construction Observation $900
162
Attachment B-1

PAYMENT
City of Hercules
Beechnut Park Project Amendment No. 2

Maintenance Services Agreement Agreement No. 23-076-CM City Attorney Approved, 03112024 Payment

6.2 Punchlist Backcheck Observation $750

6.3 Submittal Review $350

6.4 RFI/Addendums $450
SUBCONSULTANT FEE $37,340
Subconsultant Markup, 10% $3,734
Reimbursable Allowance $850

TOTAL CONTRACT AMOUNT $84,534

SUBCONSULTANT RATES

CSWST2

CSWST2 agrees to provide the services described above on a time and expense basis, in accordance with our current Hourly Rates and Billing Policy, a copy of which is enclosed.

RMA Irrigation

Additional Services:

Site Meeting $175.00 per hour
Digital As-built Documentation $150.00 per hour
Landscape Irrigation Audit $175.00 per hour

Hourly fee schedule:

Principal $200.00 Project
Manager
$175.00 Design
Assistant
$150.00 CADD
Technician
$125.00
Fieldwork/Audit $175.00 Clerical $100.00

163

DISCUSSION AND/OR ACTION ITEM

AGENDA ITEMS

3. 26-051
164

STAFF REPORT TO THE CITY COUNCIL

DATE: Regular Meeting of February 24, 2026
TO: Mayor and Members of the City Council
VIA: Dante Hall, City Manager
SUBMITTED BY: Glenn Dombeck, Public Works Director/City Engineer SUBJECT: Initiation of F iscal Year 2026/27 Landscaping and Lighting Assessment Districts Proceedings
RECOMMENDED ACTION:

It is recommended by City staff that City Council adopt a resolution directing the filing of the Fiscal Year (FY) 202 6/27 Engineer’s Reports for the City of Hercules Landscaping and Lighting Assessment District No. 83-2, Victoria by the Bay Landscaping and Lighting Assessment District No. 2002-1, Hercules Village Landscaping and Lighting Assessment District No. 2002-2, Baywood Landscaping and Lighting Assessment District No. 2004-1, and Bayside Landscaping and Lighti ng Assessment District No. 2005 -1 pursuant to the Landscaping and Lighting Act of 1972.

EXECUTIVE SUMMARY:

As required by the Landscaping and Lighting Act of 1972 (hereinafter “the Act”), the first step in the annual process to levy and collect assessments through the City’s five (5) Landscaping and Lighting Assessment Districts (LLADs) is the preparation of an annual Engineer’s Report for each LLAD. The Act requires the City adopt a resolution ordering the filing of the Engineer’s Report and that the Engineer’s Report identify the following:
1) The fiscal year for which the report applies.
2) Any proposed new improve ments or any substantial changes in existing improvements.
3) Plans and specifications for the improvements.
4) An estimate of the cost of the improvements, including:
165
a. The total cost for improvements to be made that year, being the total cost of constructing or installing all proposed improvements and of maintaining and servicing all existing and proposed improvements, including all incidental expenses. This may include a reserve which shall not exceed the estimated cost of maintenance and servicing through December 31st of the fiscal year, or whenever the City expects to receive its first installment of special assessments and tax collections from the County, whichever is later. b. The amount of any surplus or deficit in the improvement fund to be carried over from a previous fiscal year.
c. The amount of any contributions to be made from sources other than assessments.
d. The net amount to be assessed upon assessable lands within the LLAD. 5) A diagram for the LLAD.
6) An assessment of the estimated cost of the improvements, wh ich will do the following:
a. State the net amount to be assessed upon assessable lands within the LLAD.
b. Describe each assessable lot or parcel of land within the LLAD. c. Assess the net amount upon all assessable lots or parcels of land within the LLAD by appor tioning that amount among the several lots or parcels in proportion to the estimated benefits to be received by each lot or parcel from the improvements.

As previously discussed with City Council, the Hercules Village Landscaping and Lighting Assessment District No. 2002 -2 (Hercules Village LLAD) is facing an operating deficit.

The financial challenges currently facing the Hercules Village LLAD are largely the result of significant external cost pressures that have increased over the past several years.

Extreme drought conditions throughout California have required substantially higher levels of irrigation in order to preserve existing landscaping and prevent the loss of trees, turf, and other plant materials. These conditions have resulted in irrigation usage well above historical levels. During this same period, water rates charged by East Bay Municipal Utility District (EBMUD) have also increased significantly. The combined effect of increased water consumption and higher utility rates has been the primary driver of rising expenditures for the Hercules Village LLAD.

In addition, landscaping maintenance needs within the newer urbanist deve lopments north of Interstate 80 have evolved as these communities have matured. Trees originally planted as part of the development have grown significantly in both height and width and now require routine professional pruning and maintenance. This work must be performed by specialized contract tree -trimming services and was not anticipated in the original scope of work when the Hercules LLAD was established . As a result, these services represent new, ongoing expenses that are not adequately covered by exis ting assessment revenues.
166
As a result of these factors, the Hercules Village LLAD has experienced annual operating deficits between $40,000 to $60,000 over the past several years. As part of this agenda item, City staff is seeking City Council approval to initiate Proposition 218 proceedings for an assessment increase in the Hercules Village LLAD. If the assessment increase is not approved, it is projected that the Hercules Village LLAD will incur a cumulative fund deficit of approximately $50,000 by the end of Fiscal Year 2026/27.

Adoption of the recommended resolution directs the preparation of the Engineer’s Report for each LLAD, which will be brought to City Council for preliminary approval at the April 28, 2026 City Council meeting, and authorizes Proposition 218 proceedings to mail a notice and ballot to property owners within the Hercules Village LLAD this spring.

BACKGROUND:

Landscaping and Lighting Assessment District No. 83-2
Landscaping and Lighting Assessment District No. 83 -2 (hereinafter “LLAD No. 83 -2”) was formed on January 5, 1984 by Resolution No. 84 -7. LLAD No. 83 -2 originally consisted of four residential areas or zones: Zone 1 (Olympian Hills, Citation Homes West of San Pablo and Historic Homes), Zone 2 (Foxboro and Willow Glen Apartments), Zone 3 (Valley Oaks and Tiffany Ridge), and Zone 4 (Falcon Heights).

Later in 1984; Zones 3 and 4 were combined when connected by the Marsten Ranch development annexation; Zone 5 (commercial and undeveloped properties) was annexed to LLAD No. 83-2, Zone 6 (Village Parkway) a residential area was separated from Zone 5 upon development, and Zone 7 (Hanna Ranch) was annexed to LLAD No. 83-2.

In 1991, the existing neighborhoods known as Zone 8 (Trees and Flowers) and Zone 9 (Birds and Country Run) and Zone 10 (Citywide park and recreation facilities) were annexed to LLAD No. 83-2 following a mailed assessment ballot proceeding.

In 1997 the assessment methodology was revised to conform to the requirements of Article XIII D of the California Constitution (enacted by Proposition 218). An assessment ballot proceeding in June of 1997 confirmed LLAD No. 83-2. The June 1997 assessment ballot authorized the City to levy and collect assessments through FY 2002/03. The 1997 assessment ballot proceeding also authorized the City to increase assessments annually by the prior year’s change in the Consumer Price Index (CPI) each fiscal year through FY 2002/03.

In FY 2003/04 the property owners approv ed an assessment increase commencing FY 2003/04 and approved the continuation of LLAD No. 83-2 through FY 2012/13. The 2003 assessment ballot proceeding also authorized the City to annually increase assessments by the prior year’s change in the Consumer Price Index (CPI) each fiscal year through FY 2012/13.

167
In May of 2010, the property owners approved three (3) major changes to LLAD No. 83 - 2 commencing in FY 2010/11:

1) The removal of the assessment levy sunset date of FY 2012/13 and allowing LLAD No. 83-2 to continue in perpetuity.
2) Continuation of the authorization to increase assessments annually by the prior year’s change in the Consumer Price Index (CPI).
3) Changes to the assessment methodology to recognize changes to developing areas to provide consistency throughout LLAD No. 83-2.

In FY 2016/17 the City conducted a Proposition 218 election to increase assessments in LLAD No. 83 -2 Benefit Zones 1, 3&4, 5C, 6, and 7 for FY 2017/18. The assessment increase was approved by property owners in Benefit Zone 5C for FY 2017/18. In FY 2017/18 the City conducted a Proposition 218 election to increase assessments in LLAD No. 83-2 Benefit Zones 1, 3&4, 6, 7 and 9 for FY 2018/19. The assessment increase was approved by property owners in Benefit Zone 9 for FY 2018/19. In FY 2018/19 the City conducted a Proposition 218 election to increase assessments in LLAD No. 83-2 Benefit Zone 1 and the areas of Benefit Zone 7 excluding Bay Pointe, Bravo, and Caprice for FY 2019/20. The assessment increase was approved by property owners in Benefit Zone 1 and the areas of Benefit Zone 7 excluding Bay Pointe, Bravo, and Caprice within LLAD No. 83-2 for FY 2019/20.

Victoria by the Bay Landscaping and Lighting Assessment District No. 2002-1 The Victoria by the Bay development was required to install approximately 24 acres of landscaped medians, frontages and parks and 211 streetlights as a condition of approval of the development. The area was formerly part of Zone 5C in LLAD No. 83 -2. The improvements in the Victoria by the Bay development were determined to be distinct from other improvements within existing LLAD No. 83 -2 and to require a higher level of maintenance. Therefore, the development was detached from LLAD No. 83 -2 and the Victoria by the Bay LLAD was formed on May 14, 2002 by Resolution No. 02 -050 of the City Council pursuant to the Landscaping and Lighting Act of 1972.

In the fall of 2023 and spring of 2024, the City conducted Proposition 218 proceedings to increase assessments within the Victoria by the Bay LLAD. In both instances, property owners did not approve the proposed assessment increases. The City subsequently initiated a third Proposition 218 proceeding, in which property owners approved the proposed increase. As a result, the increased assessments have been implemented to stabilize the financial condition of the Victoria by the Bay LLAD.

Hercules Village Landscaping and Lighting Assessment District No. 2002-2 The Hercules Village development was required to extend Railroad Avenue, install approximately 50 acres of landscaped improvements, wh ich include parkway strips, paseos, an enhanced pond and detention basins, 122 streetlights and provide slope and retaining wall maintenance adjacent to the City’s existing pedestrian pathway as a condition for approval of the development. The area was formerly part of Zone 5C in LLAD 168
No. 83-2. The improvements in the Hercules Village development were determined to be distinct from other improvements within existing LLAD No. 83 -2 and would require a higher level of maintenance. Therefore, the development wa s detached from LLAD No. 83-2 and Hercules Village Landscaping and Lighting Assessment District No. 2002-2 was formed on May 14, 2002 by Resolution No. 02 -049 of the City Council pursuant to the Landscaping and Lighting Act of 1972.

Baywood Landscaping and Lighting Assessment District No. 2004-1 The Baywood development was required to extend Sycamore Avenue 60 feet, install approximately 4.5 acres of landscaped improvements, which include tree -lined streets, alleyways, and natural open spaces, and construct 37 streetlights as a condition for approval of the development. The area was formerly part of Zone 5C in LLAD No. 83 -2.

The improvements in the Baywood development were determined to be distinct from other improvements within existing LLAD No. 83 -2 and would require a higher level of maintenance. Therefore, the development was detached from LLAD No. 83 -2 and Baywood Landscaping and Lighting Assessment District No. 2004-1 was formed on April 13, 2004 by Resolution No. 04-034 of the City Council pursuant to the Landscaping and Lighting Act of 1972.

Bayside Landscaping and Street Lighting Assessment District No. 2005-1 The Bayside development was required to install a 0.67 acre neighborhood park and public street lights as a condition of approval of the development. The area was formerly part of Zone 5C in LLAD No. 83-2. The improvements in the Bayside development were determined to be distinct from other improvements within existing LLAD No. 83 -2 and would require a higher level of maintenance. Therefore, the development was detached from LLAD No. 8 3-2 and Bayside Landscaping and Lighting Assessment District No. 2005-1 was formed on May 10, 2005 by Resolution No. 05 -060 of the City Council pursuant to the Landscaping and Lighting Act of 1972.

ANALYSIS:

Based on preliminary analysis, it is estimated an assessment increase of approximately $50 annually over an 8 -year period ($400 total) will be necessary to eliminate the operating deficit for the Hercules Village LLAD. This proposed increase is an estimate at this time and will be finalized with the preparation of the required Engineer’s Report that is scheduled to be approved by City Council in April. Any approved increase would be in addition to the existing annual escalator tied to changes in the Consume r Price Index (CPI), which is already in place for the Hercules Village LLAD.

The schedule for the Hercules Village LLAD Proposition 218 proceedings will run concurrently with the annual approval process for all five of the City’s LLADs. The remaining estimated schedule is as follows:

February 24, 2026: City Council adopts Resolution of Initiation for all LLADs. 169
April 28, 2026: City Council preliminarily approves the Engineer’s Reports for all LLADs and adopts the Resolutions of Intention.

No Later than May 8, 2026: Mail required Proposition 218 notices and ballots to Hercules Village LLAD property owners (must occur a minimum of 45 days prior to public hearing).

June 23, 2026: City Council conducts public hearing for all LLADs, closes balloting period and conducts ballot tabulation for the Hercules Village LLAD, declares results of the ballot tabulation for the Hercules Village LLAD, and approves the Final Engineer’s Reports and FY 2026/27 assessments for all LLADs.

FISCAL IMPACT:

If assessments for the LLADs are not levied, there would be a n estimated revenue loss of $3.6 million for FY 202 6/27 to fund the maintenance and operations associated with the City’s public parks, landscaping, streetlighting, and open space areas.

ATTACHMENTS:

Attachment 1 Resolution initiating FY 2026/27 LLAD proceedings and directing the filing of the Engineer’s Reports

170

RESOLUTION 26-

RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES DIRECTING THE FILING OF THE ANNUAL ENGINEER’S REPORT FOR CITY OF HERCULES LANDSCAPING AND LIGHTING ASSESSMENT DISTRICT NO. 83 -2, VICTORIA BY THE BAY LANDSCAPING AND LIGHTING ASSESSMENT DISTRICT NO. 2002 -1,

HERCULES VILLAGE LANDSCAPING AND LIGHTING ASSESSMENT DISTRICT NO. 2002-2, BAYWOOD LANDSCAPING AND LIGHTING ASSESSMENT DISTRICT NO. 2004-1, AND BAYSIDE LANDSCAPING AND LIGHTING ASSESSMENT DISTRICT NO. 2005-1 PURSUANT TO THE LANDSCAPING AND LIGHTING ACT OF 1972

WHEREAS, the City Council through previous resolutions has established and levied annual assessments for the City of Hercules Landscaping and Lighting Assessment District No. 83-2, Victoria by the Bay Landscaping and Lighting Assessment District No. 2002-1, Hercules Village Landscaping and Lighting Assessment District No. 2002 -2, Baywood Landscaping and Lighting Assessment District No. 2004 -1, and Baysid e Landscaping and Lighting Assessment District No. 2005-1 (hereinafter referred to as the “Districts”), pursuant to the provisions of the Landscaping and Lighting Act of 1972, Part 2, Division 15 of the California Streets and Highways Code (commencing with Section 22500) (hereinafter referred to as the “Act”) that provides for the collection of assessments by the County of Contra Costa on behalf of the City of Hercules to pay the maintenance and services of improvements and facilities related thereto;

WHEREAS, the City Council desires to initiate proceedings for the levy of annual assessments against certain lots and parcels of land within the Districts for fiscal year 2026/27 for the landscaping and lighting improvements and services that will provide benefit to the properties within the Districts pursuant to the provisions of the Act;

WHEREAS, the City Council desires to conduct a Proposition 218 election with property owners located with in the Hercules Village Landscaping and Lighting Assessment District No. 2002-2 to obtain property owner approval to increase assessments; and

WHEREAS, the City has retained Francisco & Associates (hereinafter referred to as the “Engineer of Work ”), for the purpose of assisting with the levy of such assessments, including the preparation, and filing of the required Engineer’s Reports with the City Clerk in accordance with the Act.

NOW, THEREFORE, BE IT RESOLVED, by the City Council of the City of Hercules as follows:

1. The above recitals are true and correct.

2. Engineer’s Report: The City Council hereby orders the Engineer to prepare and file with the City Clerk the Engineer's Reports concerning the improvements and services within the Districts and the levy of assessments within the Districts for the fiscal year commencing July 1, 2026 and ending June 30, 2027, in accordance with Chapter 3 Section 22623 of the Act. Said Engineer’s Reports shall contain a description of the improvements and services, an estimate of the costs financed by the levy of the assessments, the properties benefiting from the improvements, the method of 171

apportioning the assessments, and any substantial changes to the existing improvements and assessments.

3. Proposed Improvements: The improvements and services include but are not li mited to the maintenance, operation and incidental expenses related to: streetlighting, street trees; turf; ground cover and shrubs; irrigation and electrical systems; monuments; fountains; hardscape improvements; masonry walls and other fencing, and all necessary appurtenances and services connected with the landscaped channel ways, medians, parkways, entryways, parks and public easements and facilities designated and maintained as part of District improvements. The Engineer’s Reports prepared in connection with these proceedings shall provide a more detailed description of the improvements and services to be provided by the Districts and which properties are proposed to be assessed.

The foregoing Resolution was duly and regularly adopted at a regular meeting of the City Council of the City of Hercules held on the 24th day of February 2026, by the following vote of the Council:

AYES:

NOES:

ABSENT:

ABSTAIN:

________________________________
Chris Kelley, Mayor

ATTEST:

Eibleis Melendez, City Clerk
172

DISCUSSION AND/OR ACTION ITEM

AGENDA ITEMS

4. 26-049
173

STAFF REPORT TO THE CITY COUNCIL

It is recommended that the City Council receive an update on the status of the FY 2025- 26 Capital Improvement Program.

BACKGROUND:

The adopted FY 2 025-26 Program includes 40 projects totaling approximately $6.74 million in improvements , with an additional $5 .14 million of prior year balance , for a combined available funding of $11.88 million categorized under the 5 functional areas of Buildings & Facilities, Streets, Parks, Sewer, and Transportation (aka the Hercules Hub).

A copy of the adopted FY 2025 -26 Capital Improvement Program is provided in Attachment 1.

Current and prior year funding for the Hub represents 35 percent of total current spending, 84 percent of which is grant funded. Excluding the Hub, there is $7.7 million of available funding for 26 active projects.

Public works is making significant progress on the current fiscal year approved CIP projects. Some notable updates included in the FY 2025-26 Program include:

Buildings & Facilities

 A fence has been installed around the transformer at the Senior Center.

 Temporary roof repairs were implemented at City Hall and Lupine Kidz Center.

174
 Replacement of 50 LED lamps and ballasts has been completed at the Library, resulting in elimination of excessive noise.
 The Police Lobbies construction has been delayed by lack of availability of bulletproof materials. A materials substitution request has been resolved and construction will commence in late February with completion anticipated in April 2026.
 HVAC upgrades and associated electrical improvements have been completed at the Ohlone Community Center and Foxboro Community Center . Similar work at the Community Swim Center is ongoing. Slot Drain Repair at the Community Swim Center has been completed.

Streets
 Construction on the Falcon Way Pavement Rehabilitation project is underway, with completion anticipated in March 2026. Wren and Finch Courts will receive full mill and overlay restoration resulting in a change order credit to the City.  65% design for Foxboro Pavement Rehabilitation Project is underway. Final design for Phase 1 streets will proceed this fiscal year with c onstruction anticipated to occur in Summer 2026. Design and construction for Phase 2 is anticipated for 2028 pending resolution of PG&E work in Foxboro neighborhood, Willow-Newbury sewer rehabilitation and construction activity at the Loop site on Willow Ave.  Two bids were received for the John Muir Parkway Traffic Calming project. Costs do not warrant proceeding with construction. Alternative traffic calming measures will be evaluated at an upcoming Traffic Safety Committee meeting.  A bioretention area on John Muir Parkway has been identified sufficient to address the RWQCB’s Clean Water Program C.3.j requirement to develop a bioretention design for handling 1.58 acres of stormwater runoff on public right of way. The City is in process of soliciting proposals to complete the design and fully fund the project on or before June 30, 2027.
 Annual Street Repair funding has been utilized to restripe crosswalks and improve signage at the intersection of San Pablo Avenue and Sycamore Avenue. Stop control warrant analysis have been completed at 5 intersections to address legacy safety concerns received by the community. Design is underway on a repair of the damaged stormwater v -ditch near Falcon Way. A RFP is in development for restriping of streets in several neighborhoods throughout the City.

Parks
 Design for the Beechnut Park Improvement Project to install much-needed amenities to this neighborhood park is pending Council authorization. An 175
Easement Agreement with PG&E to allow development of park facilities within an existing overhead power line easement has been finalized.  A combined project for Refugio Valley Park Picnic Area and Foxboro Park Basketball Court and Playground Improvements is nearing commencement of construction, with work anticipated to be completed by June 2026.  The Refugio Lake Restoration Project is proceeding with development of a complete design and bid package for the dredging, material reuse, mitigation, and limited civil infrastructure improvements for bid in Spring 2026 and construction in July to September 2026.
 The Bay Trail Soil Nail Wall Sinkhole Repair project was delayed from starting construction due to wet weather and finalization of an access agreement with BioRad Laboratories. Notice to proceed is anticipated for Spring 2026.

Sewer
 Staff continue to develop pre -design information to scope a Sewer Line Repair/Replacement Project under SR-4 and along Willow Ave. CCTV imagery of these areas and an additional segment on Newbury Street has been obtained and will support this effort.

Hercules Hub
 Staff continue to work to secure grant funding for completing the design and construction of this place-making, multimodal transportation facility. An application for the Federal Railroad Administration’s National Railroad Partnership Grant Application was submitted in early February. Staff intend to apply for the upcoming STMP Cycle 3 funding.
 HDR continues work to finalize the 10% design, coordinate with Union Pacific Railroad and with the John Muir Land Trust to finalize the Refugio Creek Conservation Easement.

Completed Projects
Since the last update in September 2025, the following projects of interest have been completed, but not yet been reported out on:
 Work continues on the update to the 10-Year Capital Improvement Program. A CIP Update will be scheduled in March 2026 to inform Council of the progress on this effort.
176
ANALYSIS:

A verbal status update, as shown in the presentation in Attachment 2, will be provided at the meeting and staff can respond to specific questions at that time.

FISCAL IMPACT:

There is no fiscal impact associated with this staff report.

ATTACHMENTS:

1. FY 2025-26 Adopted CIP Program

2. February 2026 CIP Update Presentation
177

CIP SPENDING PLAN
CITY OF HERCULES FY 2025-26 ANNUAL BUDGET

CITY OF HERCULES
TEN-YEAR CAPITAL IMPROVEMENT PROJECT PROGRAM SPENDING PLAN FY 2025-2035 Project Name Fundiing Sources
Priior Year
Ballance
FY 2025-26
Projjectiion
FY 2026-27
Projjectiion
FY 2027-28
Projjectiion
FY 2028-29
Projjectiion
FY 2029-30
Projjectiion
FY 2030-31
Projjectiion
FY 2031-32
Projjectiion
FY 2032-33
Projjectiion
FY 2033-34
Projjectiion
FY 2034-35
Projjectiion
Totall Projjectiion
Cit
y Hall General Fund/Capital Reserves 126,270 337,700 - - - - - - - - - 463,970 Senior Center General Fund/Capital Reserves 22,715 19,250 - - - - - - - - - 41,965 Library General Fund/Capital Reserves 107,254 - - - - - - - - - - 107,254 Community Swim Center General Fund/Capital Reserves 132,638 100,000 - - - - - - - - - 232,638 Teen Center General Fund/Capital Reserves 20,460 11,000 - - - - - - - - - 31,460 Hanna Ranch Childcare Center General Fund/Capital Reserves 6,820 34,650 - - - - - - - - - 41,470 Lupine Kidz Center General Fund/Capital Reserves 17,380 - 17,160 - - - - - - - - 34,540 Public Works Maintenance Yard General Fund/Capital Reserves 8,650 - - - - - - - - - - 8,650 Ohlone Community Center General Fund/Capital Reserves 113,905 37,620 - - - - - - - - - 151,525 Foxboro Community Center General Fund/Capital Reserves 9,735 - - - - - - - - - - 9,735 Police Impact Fee 200,000 - - - - - - - - - - 200,000
Asset Seizure Fund 112,722 - - - - - - - - - - 112,722
Leila's By The Bay Roof General Fund/Capital Reserves 30,000 - - - - - - - - - 30,000 Main & Play Pool Maintenance & Repairs Unfunded - 100,000 - - - - - - - - 100,000 Pool Pump Room Unfunded - 75,000 - - - - - - - - 75,000 Future Facility Capital Improvement Project Unfunded - - 415,000 415,000 415,000 415,000 415,000 415,000 415,000 415,000 - 3,320,000 Total, Facilities 878,549 570 ,220 607 ,160 415 ,000 415 ,000 415 ,000 415 ,000 415 ,000 415 ,000 415 ,000 - 4 ,960,929 General Fund/Capital Reserves 920,505 - - - - - - - - - - 920,505 SB1 RMRA 400,000 -- -- --- -- - 400,000
Solid Waste Fund 250,000 - - - - - - - - - - 250,000
General Fund/Capital Reserves - 750,000 - - - - - - - - - 750,000 SB1 RMRA 150,000 250,000 - - - - - - - - - 400 ,000
Measure J Fund - 263 - 100,000 - - - - - - - - - 100,000 SB1 RMRA - - 250 ,000 -- --- -- - 250,000
Measure J Fund - 263 - - 100,000 - - - - - - - - 100,000 General Fund/Capital Reserves - 150,000 - - - - - - - - - 150,000 Unfunded - 1,150,000 - - - - - - - - 1,150,000
Green Infrastructure Project General Fund/Capital Reserves - 150,000 - - - - - - - - - 150,000 SB1 RMRA - 250 ,000 250 ,000 250 ,000 250,000 250 ,000 250,000 250 ,000 250 ,000 250,000 - 2 ,250,000 Measure J Fund - 263 - 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000 - 900,000 General Fund/Capital Reserves - 150,000 - - - - - - - - - 150,000 Unfunded - - 250,000 250,000 250,000 250,000 250,000 250,000 250,000 250,000 - 2,000,000 John Muir Parkway Traffic Calming Imp General Fund/Capital Reserves 258,000 - - - - - - - - - 258,000 Total, Streets 1,720,505 2 ,158,000 2 ,100,000 600 ,000 600 ,000 600 ,000 600 ,000 600 ,000 600 ,000 600 ,000 - 10,178,505 Sycamore Ave (Upper Trunk Main) Sewer Fund - 421 - - - - - - - - - - - 0 Sycamore Ave (Lower Trunk Main) Sewer Fund - 421 - - 0
Promenade Lift Station Sewer Fund - 421 - 185,000 1,170,450 - - - - - - - - 1,355,450 Repair/Replace Sewer Lines under SR-4 & Along
Willow Avenue
Sewer Fund - 421 - 200,000 100,000 1,080,000 - - - - - - - 1,380,000 Lower S
ycamore Ave. SS Overflow Pipeline Sewer Fund - 421 151,680 1,648,320 1,800,000 Total, Sewer - 536,680 2 ,918,770 1 ,080,000 -- --- -- 4 ,535,450 Eastbay Regional Park District WW
Grant Fund
39,494 - - - - - - - - - - 39,494
Prop 64 Grant Funds 151,097 190,500 - - - - - - - - - 341,597 Parks Impact Fee - 150,000 - - - - - - - - - 150,000
General Fund/Capital Reserves - 50,000 - - - - - - - - 50,000 Unfunded - - 550,000 - - - - - - - - 550,000
Foxboro Basketball Court General Fund/Capital Reserves 118,241 - - - - - - - - - - 118,241 General Fund/Capital Reserves 537,917 - - - - - - - - - - 537,917 Communit
y Development Tax 170,000 - - - - - - - - - - 170,000
General Fund/Capital Reserves - 55,000 - - - - - - - - 55,000 Unfunded 135,000 135,000 270,000
General Fund/Capital Reserves 132,101 120,000 450,000 - - - - - - - - 702,101 Unfunded - 225,000 - - - - - - - - 225,000
Woodfield Basketball Court Unfunded - 215,000 - - - - - - - - 215,000 Woodfield Tennis Court Unfunded - - 320,000 - - - - - - - 320,000 Woodfield Replace Restroom Unfunded - - - - - 465,000 - - - - 465,000 Woodfield Accessibility Route Unfunded - - - - 55,000 273,000 - - - - - 328,000 Transportation Impact Fee - - - - 240,000 - - - - - - 240,000 Unfunded - - - - 1,440,000 - - - - - 1,440,000
Slurry Seal the Bay Trail Unfunded - - - 132,000 - - - - - - - 132,000 Bay Trail Wall Repair SB1 RMRA 100,000 -- -- --- -- - 100,000 Total, Parks 1,248,850 565 ,500 1 ,575,000 587 ,000 295 ,000 1 ,713,000 465 ,000 -- -- 6 ,449,350 Grant - Measure J SP 89,000 89,000 89,000 267,000
Grant - Measure J TLC 117,972 117,972
Grant - WCCTAC STMP 264,340 950,000 - 1,214,340
Grant - Garamendi Earmark 822,973 822,973
Grant - TIRCP 1,200,000 1,200,000 2,400,000
General Fund/Capital Reserves 670,500 2,329,500 3,000,000 Unfunded 4,250,000 29,085,319 30,162,080 30,162,080 7,540,520 101,199,999 Totall, Transportatiion 1,294,285 2,909,500 5,539,000 31,414,819 30,162,080 30,162,080 7,540,520 - - - - 109,022,284 Totall, CIP 5,142,189 6,739,900 12,739,930 34,096,819 31,472,080 32,890,080 9,020,520 1,015,000 1,015,000 1,015,000 - 135,146,518 Hercules - The HUB
Foxboro Playground
Refugio Picnic Area
Refugio Tennis Court
Dredge Refugio Lake
Sycamore Avenue Bicycle
Police Department Lobbies
Falcon Way
Beechnut Park
Foxboro
Hercules By The Bay
Annual Street Repair Project
178
Capital Improvement
Program Update
Fiscal Year 2025-26
February 24, 2026
179
FY 2025-26 Capital Improvements Program
Buildings & Facilities
15 projects
Streets
6 projects
Parks
13 projects
Sewer
5 projects
Hercules Hub
1 project
40 Distinct Projects
$6.45 million (excluding Hub)
180
Buildings & Facilities Overview
181
Streets Overview
182
Street Conditions
• Pavement Condition Index is trending downward
fr
om 2022 to today
• PCI to be updated in 2026
• Proposed CIP ($2.2M/yr) focused on repairing failed
s
treets does not reverse PCI trend
• Additional Funding is needed to Stabilize ($3.6M/yr)
o
r Reverse ($5.2M/yr) PCI trend
• Deferred Maintenance costs rise with lower funding
s
cenariosFair Poor Failed
183
Parks Overview
184
Sewer Overview
185
Hercules Hub Overview
186

DISCUSSION AND/OR ACTION ITEM

AGENDA ITEMS

5. 26-053
187

STAFF REPORT TO THE CITY COUNCIL

DATE: Regular Meeting of February 24, 2026

TO: Mayor and Members of the City Council

VIA: Dante Hall, City Manager

SUBMITTED BY: Tim Rood, Community Development Director

SUBJECT: Tiered Business Attraction Grant Program

RECOMMENDED ACTION:

Receive a presentation and adopt a resolution approving a Tiered Business Attraction Grant Program and approving an appropriation of $200,000 from the General Fund Reserve for the program.

BACKGROUND:

In July 2023, the City Council established a pilot Business Attraction Grant program to assist new, locally owned eating & drinking establishments with their move-in expenses.

Commercial landlords typically provide a fixed cost per square foot allowance for tenant improvements (build -out of the interior of a commercial space to suit the needs of a particular tenant). In many cases, actual construction costs are significantly hig her than the allowance, with the portion above the allowance paid by the business moving in.

Businesses offering food and beverage service also have significant costs for furnishings, fixtures and equipment, such as commercial appliances, point of sale sys tems, furniture and tableware. By assisting with these costs, the City aims to lower the bar for entry of desired types of new businesses.

Qualifying new businesses moving into vacant spaces were eligible for up to $25,000 in matching grants toward specifi ed move -in costs, including tenant improvement construction net of the tenant improvement allowance provided by the landlord, permitting, fittings, furnishings, and equipment. The existing funding has been fully committed, with f our businesses qualif ying for the maximum $25,000 grants: Tommy’s 188
BBQ, Sugar Toof, H ŌM Coffee and Pho Hanoi 89. Grant funding for Tommy’s , Sugar Toof and Pho Hanoi 89 has been completely disbursed. HŌM Coffee has received $20,000 to date and is eligible for a final payment of $5,000 once the business receives a certificate of occupancy.

ANALYSIS:

At its January 27, 2026 meeting, the City Council received a report and reviewed draft guidelines for a renewed Business Attraction Grant program that is “tiered” to include larger grants and broader eligibility criteria for the largest vacant spaces, the Big Lots and Rite-Aid sites. The Council directed staff to return for formal authorization and a funding appropriation.

The proposed program guidelines (Attachment 2) include two categories. First, Eating & Drinking Establishment grants for smaller spaces would continue with similar eligibility criteria as before, but with a new grant maximum of $20,000 for spaces less than 1,500 square feet and $30,000 for spaces between 1,500 and 5,000 square feet.

Second, a new General Business Attraction category would be created for the two larger spaces, with broader eligibility criteria for many types of retail uses that generate sales tax. The General category would also include national chains and franchises, which are the primary tenants of these larger spaces.

Previously, $150,000 in funding was recommended to be reserved for the two larger spaces (Big Lots and Rite-Aid), which would leave $50,000 to support up to two Eating & Drinking Establishment grants in smaller spaces. The owners of the Big Lots space have informed staff that in January 2026, they entered into a Letter of Intent and are negotiating a lease with Goodwill, which woul d not qualify for a grant due to its proposed on -site donation station. The base lease term is 10 years with an option for two additional 5 -year terms, for a total of 20 years should the options be exercised.

To account for these changed circumstances and provide greater flexibility, staff is proposing a minor amendment to the program guidelines reviewed by the Council on January 27, 2026, to eliminate the cap on funding in each of the grant categories. This will allow the entire recommended appropriation of $200,000 to be used for any type of qualifying grant until the funding is exhausted.

FISCAL IMPACT:

This program requires an allocation of $200,000. Staff recommends appropriating funds from the General Fund reserve to support this proposed expenditure.

189
Attachments:

1. Resolution

2. Draft program guidelines
190

1 RESOLUTION NO. 26-

A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF HERCULES APPROVING

A TIERED BUSINESS ATTRACTION GRANT PROGRAM AND APPROVING AN APPROPRIATION OF $200,000 FROM THE GENERAL FUND RESERVE FOR THE

PROGRAM

WHEREAS, the City of Hercules values its locally owned small businesses, including restaurants, and seeks to attract additional small businesses; and

WHEREAS, the City of Hercules seeks to encourage restaurants, wine bars, micro - breweries and micro -distilleries to locate in vacant retail spaces in Hercules to bring increased vibrancy and provide public gathering places; and

WHEREAS, businesses offering food and beverage service also have significant costs for furnishings, fixtures and equipment, such as commercial appliances, point of sale systems, furniture and tableware; and

WHEREAS, by assisting with these costs, the City could lower the bar for entry of desired types of new businesses, which could lead to higher sales tax revenues; and

WHEREAS, a pilot Business Attraction Grant program for eating & drinking establishments was approved by the City Council on June 13, 2023 and successfully supported four new businesses in building out their new spaces; and

WHEREAS, larger retail spaces that are currently vacant represent an opportunity to attract desired types of businesses that generate sales tax revenue in categories in which Hercules currently experiences “leakage” of retail spending to other jurisdictions; and

WHEREAS, on July 15, 2025, the City Council’s Economic Development Subcommittee received a report on potential business retention and attraction activities and requested that staff develop a tiered Business Attraction Grant program with larger grants and broader eligibility criteria for larger vacant spaces; and

WHEREAS, on October 15, 2025, the City Council’s Economic Development Subcommittee reviewed draft program guidelines and requested that the item be brought to the full City Council; and

WHEREAS, on January 27, 2023, the City Council reviewed draft program guidelines and requested that staff return for an appropriation of funds;

191

2 NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Hercules as follows:

1. The City Council hereby approves the establishment of a tiered Business Attraction Matching Grant Program.

2. The City Council hereby approves the program guidelines attached hereto as Exhibit A.

3. The City Council hereby approves an appropriation of $200,000 from the General Fund reserve for this program.

The foregoing Resolution was duly and regularly adopted at a regular meeting of the City Council of the City of Hercules held on the 24th day of February 2026 by the following vote of the Council:

AYES:

NOES:

ABSTAIN:

ABSENT:

____________________________
Chris Kelley, Mayor

ATTEST:

Eibleis Melendez, City Clerk

192

3 EXHIBIT A – Program Guidelines
193

Hercules Business Attraction Grant 2.0 –
Tiered Incentive Program

A. Eating & Drinking Establishment Grant Program Eligibility  The vacant space must be less than 5,000 square feet
 The business is a brick-and-mortar, for-profit, sales tax-generating businesses in one of the following categories:
o Restaurant
o Café (if the café comprises a majority of the space/operation, or if the café is the primary use and not incidental to another use)
o Wine bar
o Brewery or taproom
o Craft distillery
 The business must lease/rent their commercial property directly from a landlord.  The business is either independently owned/operated or a locally owned franchisee (i.e., local outlets of chains or franchises that are headquartered outside of the nine-county Bay Area and/or have more than six locations are not eligible)
 The business must provide a matching move-in expenditure equal to or greater than the grant amount.
 The maximum grant amount is $20,000 for spaces less than 1,500 square feet and $30,000 for spaces between 1,500 and 5,000 square feet.

B. General Business Attraction Grant Program Eligibility  The vacant space must be 5,000 square feet or larger
 The business is a brick-and-mortar, for-profit, sales tax-generating businesses in one of the following categories:
o Beer/Wine/Liquor Stores
o Books/Periodicals/Music Stores
o Clothing/Shoe Stores
o Department Stores
o Drugstore/Health/Personal Care
o Electronics/Appliances
o General Merchandise
o Grocery Stores
o Hobby/Games/Toys
o Jewelry/Luggage/Leather Goods
o Kitchenware/Furniture/Home Furnishings
o Musical Instruments
o Pets/Pet Food/Pet Supplies
o Specialty Food Stores
194
o Sporting Goods
 Businesses that sell used merchandise and/or accept donations on-site are not eligible
 The business must have a lease in place with a primary term of at least five (5) years, excluding options
 The business may be independently or corporate owned/operated or a franchisee, with no limitations on corporate or franchise ownership  The business must provide a matching move-in expenditure equal to or greater than the grant amount.
 The maximum grant amount is $50,000 for spaces between 5,000 and 15,000 square feet and $100,000 for spaces over 15,000 square feet Submittal Requirements (Both Programs)
 Signed Lease or Letter of Intent (LOI) for a vacant (as of the grant application date) tenant space in Hercules.
 Verification that all required Planning approvals for the business have been granted and applicable appeal periods have expired.
 Pro-forma detailing all construction and move-in expenses required to open the business.
 Grant amount requested and verification by the pro-forma that the grant amount will not exceed 50% of all construction and move-in expenses.  Complete and signed online application which will include:
o Verification that the business is within one of the eligible categories. o For Eating & Drinking Establishments, verification that the business is either independently owned/operated or a locally owned chain (as required under eligibility requirements)
Use of Funds
 Tenant improvements (construction costs)
 Signage
 City, County or Utility permitting and connection fees  Mechanical, Appliance and Equipment Costs
 Furniture and Furnishings
 Computer and Software Costs
Grant payments (up to the amount requested and awarded) will be upon submittal of receipts and/or invoices to the City or its designee every 30 days, with a minimum payment of $5,000 per payment request. Business shall obtain a City Business license and have a Certificate of Occupancy prior to final reimbursement payment. 195

Hercules City CouncilFebruary 24, 2026

Hercules City Council
February 24, 2026