City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: City Manager
Meeting Date: October 7, 2024
Report #:2408-3335
TITLE
Approval of Contract Amendment Number 1 to Contract Number S24191026 with the Palo Alto Chamber of Commerce to Increase the not-to-exceed Amount by $40,000 to Provide Support for the 3rdThursday California Avenue Events (to a new total NTE of $95,000); CEQA status - Not a Project
RECOMMENDATION
Staff recommends that Council approve and authorize the City Manager or their designee to execute Amendment No. 1 to Contract No. S24191026 with Palo Alto Chamber of Commerce (Attachment A) to further support the 3rdThursday California Avenue. This amendment results in a revised total contract not-to-exceed amount of $95,000.
BACKGROUND
The Palo Alto Chamber of Commerce is an independent, nonprofit membership association dedicated to enhancing the economic and civic vitality of Palo Alto and Silicon Valley.
Established in 1910, the Chamber has served as a central hub for local business professionals to connect and engage with the broader community. It collaborates with a diverse membership that includes small businesses, retailers, hotels, restaurants, non-profit organizations, educational and health institutions, major corporations, and various other entities. The Chamber represents and advocates for the interests of over 75,000 local employees and professionals. It has supported well-known events within the city's business districts, such as the Palo Alto Festival of the Arts and 3rdThursday California Ave.
The City of Palo partners with the Palo Alto Chamber of Commerce to provide marketing, promotions, and consensus-building efforts to attract, retain, and support existing and potential Palo Alto Businesses. Additionally, the Palo Alto Chamber of Commerce serves as the fiscal agent for the 3rdThursday musical festival on California Avenue. The Chamber of Commerce has affirmed its interest in collaborative efforts to support economic recovery and vitality and willingness to serve as a consultant for such efforts.
ANALYSIS
Economic Development and Transition is one of the City Council’s four priorities for 2024. The Palo Alto Chamber of Commerce plays a crucial role in these efforts. In Fiscal Year 2024, contract S24191026 was established based on the City Council direction to allocate $50,000 to the Chamber to support local commerce initiatives as part of the FY 2024 Adopted Operating Budget. Following the mayor's announcement at the May 13th City Council meeting1 to provide an additional $5,000 from the Council contingency for the 3rdThursday events, and with the Chamber serving as the fiscal agent for these events, this funding was combined with the Chamber's original allocation to streamline administrative processes. The initial contract had a not-to-exceed amount of $55,000.
During the development and adoption of the Fiscal Year 2025 Operating Budget, the City Council approved $40,000 for 3rdThursday events as part of Citywide Special Events and Programming funding. As a result, the new not-to-exceed amount for contract S24191026 is recommended to be increased to $95,000. The funding for 3rd Thursdays is only to be used for direct costs not including any salaries. Since the Chamber is unique in its function and role, an exemption to competitive solicitation pursuant to Palo Alto Municipal Code section 2.30.360(d) was approved by the City Manager.
The recommended action of this report is consistent with previous City Council direction but is before City Council for formal approval since it exceeds the City Manager’s authority to approve.
This expanded partnership was awarded to 3rd Thursday during the Fiscal Year 2025 budget process as one-time funding. For Fiscal Year 2026 and ongoing, staff will establish a process to determine how to disburse the funds for Special Events and Programming among various nonprofit partners.
FISCAL/RESOURCE IMPACT
Funding for this contract is available in the Fiscal Year 2025 Adopted Operating Budget approved by City Council on June 17, 2024. The City Council appropriated $246,000 in Fiscal Year 2025 for Citywide Special Events and Programming.
In FY 2025 Council determined the $246,000 in funds would be disbursed as follows:
•$150,000 for Magical Bridge
•$45,000 for United Nations Association Film Festival
1 The Summary Minutes from the May 13, 2024 City Council meeting are available here:
https://cityofpaloalto.primegov.com/Public/CompiledDocument?meetingTemplateId=14266&compileOutputType =1
•$40,000 for 3rd Thursdays (via the Palo Alto Chamber of Commerce) •$11,000 for Environmental Volunteers
For FY 2026 and ongoing, $235,000 is appropriated for Citywide Special Events and Programming and a process will be established by staff over the next year to determine how to disburse the funds as part of the annual budget process.
STAKEHOLDER ENGAGEMENT
The City has coordinated with the Chamber of Commerce regarding this contract amendment.
ENVIRONMENTAL REVIEW
This is not a ”project” under CEQA regulation 15061(b)(3) because it can be seen with certainty that this event will not cause a significant effect on the environment.
ATTACHMENTS
Attachment A: Amendment No. 1 to contract S24191026 between the City of Palo Alto and Palo Alto Chamber of Commerce.
APPROVED BY:
Ed Shikada, City Manager