City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Police
Meeting Date: May 18, 2026
Report #:2604-6278
TITLE
Adopt a Resolution Approving Amendment Number 1 to California Board of State and Community Corrections Agreement Number BSCC 1164-23 for Organized Retail Theft Grant to Extend the Term One Year with No Change to the Not-To-Exceed Total; CEQA status—not a project.
RECOMMENDATION
Staff recommends that City Council approve a Resolution (Attachment A) to approve and authorize the City Manager, or their designee, to execute Agreement Amendment No. 1 with State of California Board of State and Community Corrections (BSCC) for the Organized Retail Theft grant to extend the ending date one year (June 1, 2027 to June 1, 2028), with no change to the original funding amount.
BACKGROUND
The State of California’s Budget Act of 2022 (SB 154) established the Organized Retail Theft Prevention Grant Program to support local law enforcement efforts to prevent and respond to organized retail theft, motor vehicle theft, motor vehicle accessory theft, and cargo theft. In July 2023, the City submitted an application for grant funding. In September 2023, the Board of State and Community Corrections approved the City’s application and awarded the City $5.2 million, subject to City Council acceptance. The City Council accepted the grant on December 4, 20231. The grant period began on October 1, 2023, with grant operations scheduled to end on December 31, 2026, and final work to be completed by June 1, 2027.
The grant supports targeted efforts to reduce organized retail theft and related offenses, including motor vehicle theft and license plate theft. Since implementation, staff has observed a measurable reduction in theft-related incidents. Reported retail theft in 2025 decreased by 1 City Council City Council, December 4, 2023; Agenda Item #4; SR #:2309-2066 https://cityofpaloalto.primegov.com/Portal/Meeting?meetingTemplateId=13062
72% compared with 2022, including both organized retail theft incidents and shoplifting incidents. Staff’s analysis also shows a steady decline in reported retail theft over the past 2.5 years during the active grant period; with losses as high as $1.5M in CY2022 to $429K in CY2025. Program activity, scope of work, and results are reported through the State’s Organized Retail Theft Prevention Grants dashboard administered by the Board of State and Community Corrections3.
ANALYSIS
In February 2026, the BSCC approved an amendment extending the grant activity period by one year and adding policy language regarding the use of generative artificial intelligence (AI)4. The extension is intended to address staffing challenges being experienced by agencies throughout the State and to provide additional time to complete grant-funded activities for the highest and best program impact. The amended grant term extends the deadline for grant activity to June 1, 2028.
In March 2026, the Department was notified, via email from the BSCC, requesting City Council approval by resolution to accept the extension and the new AI clause. The amendment revises the agreement by replacing Exhibit A, Scope of Work -Reporting timelines (extending all dates one year); replacing Exhibit B - Invoicing and Payments timeline (extending all dates one year); and adding Exhibit C-Generative AI Disclosure obligations, which did not exist in the original agreement, but would require the City, or its subcontractors, to disclose the use of Generative AI if used in reports related to this grant. The original agreement, scope of work and timelines are in the dashboard but can be found directly at this link (https://www.bscc.ca.gov/wp- content/uploads/68-Palo-Alto-Police.pdf).
3 State Organized Retail Theft Prevent Grants Dashboard https://www.bscc.ca.gov/organized-retail-theft-grant-program/ 4 California Board of State and Community Corrections Board Meeting, February 12, 2026, Item B https://www.bscc.ca.gov/s_boardmeetingscheduleagendasminutes/
FISCAL/RESOURCE IMPACT
This grant is structured on a reimbursement basis, meaning the City is reimbursed for eligible expenses after they are incurred. Through calendar year 2025, the City has received $2.57 million in reimbursements for grant-related activities and has an available remaining grant balance of approximately $2.6 million. To date, grant funding has primarily supported overtime costs for directed patrol and investigations in retail districts; staff time dedicated to investigating stolen vehicles and license plates; training in investigative methods and practices; acquisition of automated license plate reader (ALPR) technology; alternative pursuit technology, including GPS tracking devices deployed from patrol vehicles; a patrol vehicle for retail patrol; electric bicycles for retail patrol; and a vehicle immobilization spike system.
Staff anticipates using the remaining funds to continue supporting directed patrol and investigative activities, as well as additional technologies that assist with investigations and apprehensions of retail crimes. Consistent with all City procurements, any purchases funded through the grant will be subject to the City’s purchasing procedures, including review under the City’s surveillance technology policy, if applicable, and compliance with AB 481 military equipment disclosure requirements. Grant-related appropriations and expenditures are incorporated into the City’s budget development process and may be updated periodically during the fiscal year, including through mid-year adjustments as needed.
STAKEHOLDER ENGAGEMENT
Staff continues to work directly with the retailers and stakeholders.
ENVIRONMENTAL REVIEW
The California Public Resources Code § 21065 includes a definition of a “project” as subject to the California Environmental Quality Act (CEQA) if it is an activity directly undertaken by a public agency which may cause either a direct physical change in the environment, or a reasonably foreseeable indirect physical change in the environment. This project is exempt from the provisions of the CEQA, pursuant to Section 15061(b)(3) of the CEQA Guidelines, because it can be seen with certainty that there is no possibility that the activity will have a significant effect on the environment.
ATTACHMENTS
Attachment A: Resolution approving Amendment No. 1 to Grant Agreement BSCC 1164-23 (including the Amendment itself).
APPROVED BY:
James Reifschneider, Police Chief