City Council Memorandum
TO: HONORABLE MAYOR AND CITY COUNCIL DATE: SEPTEMBER 15, 2026 FROM: FINANCE-RISK MANAGEMENT WARDS: ALL SUBJECT: Amend the City’s initial annual authority of $750,000, which includes a 10 percent contingency of $75,000 for a total not to exceed $825,000 per fiscal year, by removing the fiscalyear limitation and authorizing City staff to utilize an amended compensation amount of the agreement totaling $2,325,000, through the end of the agreement term (2023-2026); SUPPLEMENTAL APPROPRIATION OF $531,050.79 FROM THE LIABILITY INSURANCE TRUST FUND FOR FY 2025/26 ISSUE:
Amend the City’s initial annual authority of $750,000, which includes a 10% contingency of $75,000 for a total not to exceed $825,000 per fiscal year, by removing the fiscal-year limitation and authorizing City staff to utilize an amended compensation amount totaling $2,325,000, through the end of the agreement term; Supplemental Appropriation of $531,050.79 from the Liability Insurance Trust Fund for FY 2025/26.
RECOMMENDATIONS:
That the City Council:
Amend City Council’s authority to remove the annual fiscal-year limit of $825,000, allowing the department to apply unused agreement funds toward outstanding invoices for work completed in FY 2025/26; and With at least five affirmative votes, authorize the Chief Financial Officer, or designee, to record an increase in revenue and a supplemental appropriation in the amount of $531,050.79 in the Liability Insurance Trust Fund, Finance Risk Management Property Damage Claims revenue and expenditure accounts in FY 2025/26 to be fully offset by claim fund reimbursements from the City’s insurance carrier.
BACKGROUND:
On June 27, 2023, the City Council approved a Master Agreement for Request for Proposal 2266 for Emergency and Non-Emergency Restoration Services to Belfor Property Restoration, Riverside, for a not-to-exceed amount of $750,000 per fiscal year through June 30, 2026 and authorized a 10 percent contingency of $75,000, for a total amount not-to-exceed $825,000 per fiscal year for a contract amount not to exceed Two Million Four Hundred Seventy-Five Thousand Dollars ($2,475,000.00) for the term of the Agreement.
FY 23-24
FY 24-25
FY 25-26
Max $ Aggregate Available
$ Available per FY
$750,000
$750,000
$750,000
$2,250,000
10% Contingency
$75,000
$75,000
$75,000
$225,000
Total Not-to-Exceed
$825,000
$825,000
$825,000
$2,475,000.00
On July 22, 2026, the City processed Amendment 1 to the Master Agreement activating the 10% contingency for FY 25-26. The City did not use the 10% contingency in FY 23-24 or FY 24-25.
FY 23-24
FY 24-25
FY 25-26
Aggregate Totals
$ Available per FY
$750,000
$750,000
$750,000
$2,250,000
10% Contingency
NO CONTINGENCY
NO CONTINGENCY
10 % CONTINGENCY ACTIVATED
$75,000
Actual Not-to-Exceed
$750,000
$750,000
$825,000*
$2,325,000.00
Amount Invoiced
$207,760.02
$107,856.19
$1,657,906.71
$1,973,522.92
Remaining Balance
$542,239.98
$642,143.81
($845,209.48)
$351,477.08
*The City has utilized $812,697.23 of the FY 2025/26 City Council approved not-to-exceed amount of $825,000 Risk Management is requesting Council approval to remove the annual fiscal-year limit of $825,000, allowing the department to apply unused agreement funds toward outstanding invoices for work completed in FY 2025–26.
DISCUSSION:
Risk Management dispatched Belfor to assist in four emergency projects during the second half of FY 2025-26. The total amount due to Belfor for the three emergency projects dispatched between January 2026 to June 2026 is $1,657,906.71. Collectively, the total value of authorized work for Belfor across all three fiscal years of the contract is $1,973,522.92 with 84% of the charges being incurred during the second half of the fiscal year. The City has paid $812,697.23 in FY 2025-26 and needs Council authority to apply unused agreement allotment from prior years to the current outstanding balance of $845,209.48 owed to Belfor.
PROJECT DESCRIPTIONS:
City Hall Basement Flooding: Emergency response to rainwater flooding the downstairs basement of City Hall impacting Innovation Technology and General Services operations. Risk Management filed a property claim and is only responsible for $500,000 in damages per the City’s property deductible schedule. The City will pay the remaining $531,050.79 owed for the City Hall Basement flood upon receipt of claim funds from the City’s insurance carrier.
Fire Station 2 Remediation: Remediation of attic areas containing rodent remnants. The City has paid 70% of the invoiced amount ($289,713.61) and still owes the remaining 30% ($124,158.69).
Sewer Overflow Response: Emergency response to a sewer overflow affecting a commercial business. No payments have been made on this invoice to date and the City owes $190,000.00.
University Water Intrusion: Water intrusion on a city owned structure leased by a third-party tenant. All invoices have been paid for this project.
Agreement Term (2023-2026)
Amount Invoiced
Lifetime Utilization per FY
FY 23-24
$ 207,760.02
11%
FY 24-25
$ 107,856.19
5%
FY 25-26
$ 1,657,906.71
84%
Total
$ 1,973,522.92
100%
FY
PROJECT DESCRIPTION
PAYMENT STATUS
AMOUNT INVOICED
PAYMENTS AS OF August 18, 2026
OUTSTANDING BALANCE AS OF 8/18/2026
FY 25-26
City Hall Basement
PENDING
531,050.79
-
531,050.79*
FY 25-26
Sewer Overflow
PENDING
190,000.00
-
190,000.00
FY 25-26
Fire Station 2
PENDING
124,158.69
-
124,158.69
FY 25-26
Fire Station 2
PAID
82,774.46
(82,774.46)
-
FY 25-26
City Hall Basement
PAID
48,584.68
(48,584.68)
-
FY 25-26
Fire Station 2
PAID
206,939.15
(206,939.15)
-
FY 25-26
City Hall Basement
PAID
261,415.32
(261,415.32)
-
FY 25-26
City Hall Basement
PAID
100,000.00
(100,000.00)
-
FY 25-26
City Hall Basement
PAID
90,000.00
(90,000.00)
-
FY 25-26
University Water Intrusion
PAID
22,983.62
(22,983.62)
-
FY 24-25
CX
PAID
8,003.63
(8,003.63)
-
FY 24-25
CX
PAID
36,779.07
(36,779.07)
-
FY 24-25
CX
PAID
13,970.17
(13,970.17)
-
FY 24-25
CX
PAID
9,780.87
(9,780.87)
-
FY 24-25
CX
PAID
30,002.11
(30,002.11)
-
FY 24-25
CX
PAID
3,658.80
(3,658.80)
-
FY 24-25
CX
PAID
5,661.54
(5,661.54)
-
FY 23-24
CX
PAID
7,382.52
(7,382.52)
-
FY 23-24
CX
PAID
2,166.00
(2,166.00)
-
FY 23-24
CX
PAID
3,153.00
(3,153.00)
-
FY 23-24
CX
PAID
195,058.50
(195,058.50)
-
LIFETIME TOTALS
1,973,522.92
(1,128,313.44)
845,209.48
*Full amount of $531,080.79 will be paid with insurance monies This item does not increase the total agreement value but authorizes the use of remaining contract authority from prior fiscal years to pay outstanding invoices due to Belfor for work completed during FY 25-26. No other payments will be made to Belfor as it relates to this agreement once the remaining $845,209.48 is paid.
FISCAL YEAR
PAID TO BELFOR
Total Paid as of August 18, 2026
$1,128,313.44
Agreement Value-Amendment 1
$2,325,000.00
$ of Unused Agreement Allotment
$1,184,383.79
Outstanding Amount Owed to Belfor
$845,209.48
Amount Remaining after Outstanding Invoices are paid
$351,477.08
FISCAL IMPACT:
The total fiscal impact of this action is $531,050.79. Upon City Council approval, an increase in revenue and a supplemental appropriation of $531,050.79 will be recorded in FY 2025-26 in the Liability Insurance Trust Fund, Finance Risk Management Property Damage Claims revenue account 2320000-380100 and expenditure account 2320000-428630, to pay for the remaining invoices related to the City Hall Basement Flood Damages. However, the City will receive $531,050.79 from its property insurance carrier to fully offset this cost.
Sufficient funds for Invoice No. 2284192-1, totaling $190,000.00 for the City’s emergency response to the sewer overflow, are available in the Sewer Fund, Sewer Collection System Maintenance, Chemical Supplies account 4125100-426600. Funds for Invoice No. 2317121, related to the City’s remediation efforts at Fire Station 2, are available in the Measure Z Capital Fund, Annual Deferred Maintenance account 9901909-462050.
Prepared by: Jackie Godinez, Risk Manager
Certified as to
availability of funds: Sergio Aguilar, Deputy Finance Director Approved by: Julie Nemes, Finance Director Approved as to form: James Johnson, City Attorney
Attachments:
3-Year Services Agreement with Belfor
Amendment 1
RFP 2266 Emergency and Non-Emergency Restoration Services ● Page 4