Agreement No. __________________________
AGREEMENT BETWEEN THE COUNTY OF SAN MATEO AND PETDATA, INC.
This Agreement is entered into this Fourth day of June, 2019, by and between the County of San Mateo, a political subdivision of the state of California, hereinafter called “County,” and PETDATA, INC., hereinafter called “Contractor.”
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Whereas, pursuant to Section 31000 of the California Government Code, County may contract with independent contractors for the furnishing of such services to or for County or any Department thereof; and
Whereas, it is necessary and desirable that Contractor be retained for the purpose of San Mateo County Health- Public Health, Policy & Planning.
Now, therefore, it is agreed by the parties to this Agreement as follows:
1. Exhibits and A
ttachments
The following exhibits and attachments are attached to this Agreement and incorporated into this Agreement by this reference:
Exhibit A—Services
Exhibit B—Payments and Rates
Attachment I—§ 504 Compliance
Services to be performed by Contractor
In consideration of the payments set forth in this Agreement and in Exhibit B, Contractor shall perform services for County in accordance with the terms, conditions, and specifications set forth in this Agreement and in Exhibit A.
2. Payments
In consideration of the services provided by Contractor in accordance with all terms, conditions, and specifications set forth in this Agreement and in Exhibit A, County shall make payment to Contractor based on the rates and in the manner specified in Exhibit B. County reserves the right to withhold payment if County determines that the quantity or quality of the work performed is unacceptable. In no event shall County’s total fiscal obligation under this Agreement exceed SIX HUNDRED-THIRTEEN THOUSAND NINE HUNDRED AND FORTY FIVE DOLLARS ($613,945). In the event that the County makes any advance payments, Contractor agrees to refund any amounts in excess of the amount owed by the County at the time of contract termination or expiration. Contractor is not entitled to payment for work not performed as required by this agreement.
3. Term
Subject to compliance with all terms and conditions, the term of this Agreement shall be from July 1, 2019, through June 30, 2022.
4. Termination
This Agreement may be terminated by Contractor or by the Director of Public Health, Policy and Planning or his/her designee at any time without a requirement of good cause upon thirty (30) days’ advance Resolution No. 076668
Attachment 2 - Agreement between County of San Mateo and PetData Inc.
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written notice to the other party. Subject to availability of funding, Contractor shall be entitled to receive payment for work/services provided prior to termination of the Agreement. Such payment shall be that prorated portion of the full payment determined by comparing the work/services actually completed to the work/services required by the Agreement.
County may terminate this Agreement or a portion of the services referenced in the Attachments and Exhibits based upon the unavailability of Federal, State, or County funds by providing written notice to Contractor as soon as is reasonably possible after County learns of said unavailability of outside funding.
County may terminate this Agreement for cause. In order to terminate for cause, County must first give Contractor notice of the alleged breach. Contractor shall have five business days after receipt of such notice to respond and a total of ten calendar days after receipt of such notice to cure the alleged breach.
If Contractor fails to cure the breach within this period, County may immediately terminate this Agreement without further action. The option available in this paragraph is separate from the ability to terminate without cause with appropriate notice described above. In the event that County provides notice of an alleged breach pursuant to this section, County may, in extreme circumstances, immediately suspend performance of services and payment under this Agreement pending the resolution of the process described in this paragraph. County has sole discretion to determine what constitutes an extreme circumstance for purposes of this paragraph, and County shall use reasonable judgment in making that determination.
5. Contract Materials
At the end of this Agreement, or in the event of termination, all finished or unfinished documents, data, studies, maps, photographs, reports, and other written materials (collectively referred to as “contract materials”) prepared by Contractor under this Agreement shall become the property of County and shall be promptly delivered to County. Upon termination, Contractor may make and retain a copy of such contract materials if permitted by law.
6. Relationship of Parties
Contractor agrees and understands that the work/services performed under this Agreement are performed as an independent contractor and not as an employee of County and that neither Contractor nor its employees acquire any of the rights, privileges, powers, or advantages of County employees.
7. Hold Harmless
a. General Hold Harmless
Contractor shall indemnify and save harmless County and its officers, agents, employees, and servants from all claims, suits, or actions of every name, kind, and description resulting from this Agreement, the performance of any work or services required of Contractor under this Agreement, or payments made pursuant to this Agreement brought for, or on account of, any of the following:
(A) injuries to or death of any person, including Contractor or its employees/officers/agents; (B) damage to any property of any kind whatsoever and to whomsoever belonging;
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(C) any sanctions, penalties, or claims of damages resulting from Contractor’s failure to comply, if applicable, with the requirements set forth in the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and all Federal regulations promulgated thereunder, as amended; or (D) any other loss or cost, including but not limited to that caused by the concurrent active or passive negligence of County and/or its officers, agents, employees, or servants. However, Contractor’s duty to indemnify and save harmless under this Section shall not apply to injuries or damage for which County has been found in a court of competent jurisdiction to be solely liable by reason of its own negligence or willful misconduct.
The duty of Contractor to indemnify and save harmless as set forth by this Section shall include the duty to defend as set forth in Section 2778 of the California Civil Code.
8. Assignability and Subcontracting
Contractor shall not assign this Agreement or any portion of it to a third party or subcontract with a third party to provide services required by Contractor under this Agreement without the prior written consent of County. Any such assignment or subcontract without County’s prior written consent shall give County the right to automatically and immediately terminate this Agreement without penalty or advance notice.
9. Insurance
a. General Requirements
Contractor shall not commence work or be required to commence work under this Agreement unless and until all insurance required under this Section has been obtained and such insurance has been approved by County’s Risk Management, and Contractor shall use diligence to obtain such insurance and to obtain such approval. Contractor shall furnish County with certificates of insurance evidencing the required coverage, and there shall be a specific contractual liability endorsement extending Contractor’s coverage to include the contractual liability assumed by Contractor pursuant to this Agreement. These certificates shall specify or be endorsed to provide that thirty (30) days’ notice must be given, in writing, to County of any pending change in the limits of liability or of any cancellation or modification of the policy. b. Workers’ Compensation and Employer’s Liability Insurance Contractor shall have in effect during the entire term of this Agreement workers’ compensation and employer’s liability insurance providing full statutory coverage. In signing this Agreement, Contractor certifies, as required by Section 1861 of the California Labor Code, that (a) it is aware of the provisions of Section 3700 of the California Labor Code, which require every employer to be insured against liability for workers’ compensation or to undertake self-insurance in accordance with the provisions of the Labor Code, and (b) it will comply with such provisions before commencing the performance of work under this Agreement.
c. Liability Insurance
Contractor shall take out and maintain during the term of this Agreement such bodily injury liability and property damage liability insurance as shall protect Contractor and all of its employees/officers/agents while performing work covered by this Agreement from any and all claims for damages for bodily injury, including accidental death, as well as any and all claims for property damage which may arise from Contractor’s operations under this Agreement, whether such operations be by Contractor, any subcontractor, anyone directly or indirectly employed by either of them, or an agent of either of them.
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Such insurance shall be combined single limit bodily injury and property damage for each occurrence and shall not be less than the amounts specified below:
(a) Comprehensive General Liability… $1,000,000
County and its officers, agents, employees, and servants shall be named as additional insured on any such policies of insurance, which shall also contain a provision that (a) the insurance afforded thereby to County and its officers, agents, employees, and servants shall be primary insurance to the full limits of liability of the policy and (b) if the County or its officers, agents, employees, and servants have other insurance against the loss covered by such a policy, such other insurance shall be excess insurance only.
In the event of the breach of any provision of this Section, or in the event any notice is received which indicates any required insurance coverage will be diminished or canceled, County, at its option, may, notwithstanding any other provision of this Agreement to the contrary, immediately declare a material breach of this Agreement and suspend all further work and payment pursuant to this Agreement.
10. Compliance With Laws
All services to be performed by Contractor pursuant to this Agreement shall be performed in accordance with all applicable Federal, State, County, and municipal laws, ordinances, and regulations, including but not limited to the Health Insurance Portability and Accountability Act of 1996 (HIPAA) and the Federal Regulations promulgated thereunder, as amended (if applicable), the Business Associate requirements set forth in Attachment H (if attached), the Americans with Disabilities Act of 1990, as amended, and Section 504 of the Rehabilitation Act of 1973, which prohibits discrimination on the basis of disability in programs and activities receiving any Federal or County financial assistance. Such services shall also be performed in accordance with all applicable ordinances and regulations, including but not limited to appropriate licensure, certification regulations, provisions pertaining to confidentiality of records, and applicable quality assurance regulations. In the event of a conflict between the terms of this Agreement and any applicable State, Federal, County, or municipal law or regulation, the requirements of the applicable law or regulation will take precedence over the requirements set forth in this Agreement.
Contractor will timely and accurately complete, sign, and submit all necessary documentation of compliance.
11. Non-Discrimination and Other Requirements
a. General Non-discrimination
No person shall be denied any services provided pursuant to this Agreement (except as limited by the scope of services) on the grounds of race, color, national origin, ancestry, age, disability (physical or mental), sex, sexual orientation, gender identity, marital or domestic partner status, religion, political beliefs or affiliation, familial or parental status (including pregnancy), medical condition (cancer-related), military service, or genetic information.
b. Equal Employment Opportunity
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Contractor shall ensure equal employment opportunity based on objective standards of recruitment, classification, selection, promotion, compensation, performance evaluation, and management relations for all employees under this Agreement. Contractor’s equal employment policies shall be made available to County upon request.
c. Section 504 of the Rehabilitation Act of 1973
Contractor shall comply with Section 504 of the Rehabilitation Act of 1973, as amended, which provides that no otherwise qualified individual with a disability shall, solely by reason of a disability, be excluded from the participation in, be denied the benefits of, or be subjected to discrimination in the performance of any services this Agreement. This Section applies only to contractors who are providing services to members of the public under this Agreement.
d. Compliance with County’s Equal Benefits Ordinance
Contractor shall comply with all laws relating to the provision of benefits to its employees and their spouses or domestic partners, including, but not limited to, such laws prohibiting discrimination in the provision of such benefits on the basis that the spouse or domestic partner of the Contractor’s employee is of the same or opposite sex as the employee.
e. Discrimination Against Individuals with Disabilities The nondiscrimination requirements of 41 C.F.R. 60-741.5(a) are incorporated into this Agreement as if fully set forth here, and Contractor and any subcontractor shall abide by the requirements of 41 C.F.R. 60–741.5(a). This regulation prohibits discrimination against qualified individuals on the basis of disability and requires affirmative action by covered prime contractors and subcontractors to employ and advance in employment qualified individuals with disabilities.
f. History of Discrimination
Contractor certifies that no finding of discrimination has been issued in the past 365 days against Contractor by the Equal Employment Opportunity Commission, the California Department of Fair Employment and Housing, or any other investigative entity. If any finding(s) of discrimination have been issued against Contractor within the past 365 days by the Equal Employment Opportunity Commission, the California Department of Fair Employment and Housing, or other investigative entity, Contractor shall provide County with a written explanation of the outcome(s) or remedy for the discrimination prior to execution of this Agreement. Failure to comply with this Section shall constitute a material breach of this Agreement and subjects the Agreement to immediate termination at the sole option of the County. g. Reporting; Violation of Non-discrimination Provisions Contractor shall report to the County Manager the filing in any court or with any administrative agency of any complaint or allegation of discrimination on any of the bases prohibited by this Section of the Agreement or the Section titled “Compliance with Laws”. Such duty shall include reporting of the filing of any and all charges with the Equal Employment Opportunity Commission, the California Department of Fair Employment and Housing, or any other entity charged with the investigation or adjudication of allegations covered by this subsection within 30 days of such filing, provided that within such 30 days such entity has not notified Contractor that such charges are dismissed or otherwise unfounded. Such notification shall include a general description of the circumstances involved and a general description of the kind of discrimination alleged (for example, gender-, sexual orientation-, religion-, or race-based discrimination).
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Violation of the non-discrimination provisions of this Agreement shall be considered a breach of this Agreement and subject the Contractor to penalties, to be determined by the County Manager, including but not limited to the following:
i. termination of this Agreement;
ii. disqualification of the Contractor from being considered for or being awarded a County contract for a period of up to 3 years;
iii. liquidated damages of $2,500 per violation; and/or iv. imposition of other appropriate contractual and civil remedies and sanctions, as determined by the County Manager.
To effectuate the provisions of this Section, the County Manager shall have the authority to offset all or any portion of the amount described in this Section against amounts due to Contractor under this Agreement or any other agreement between Contractor and County. h. Compliance with Living Wage Ordinance
As required by Chapter 2.88 of the San Mateo County Ordinance Code, Contractor certifies all contractor(s) and subcontractor(s) obligated under this contract shall fully comply with the provisions of the County of San Mateo Living Wage Ordinance, including, but not limited to, paying all Covered Employees the current Living Wage and providing notice to all Covered Employees and Subcontractors as required under the Ordinance.
12. Compliance with County Employee Jury Service Ordinance Contractor shall comply with Chapter 2.85 of the County’s Ordinance Code, which states that Contractor shall have and adhere to a written policy providing that its employees, to the extent they are full-time employees and live in San Mateo County, shall receive from the Contractor, on an annual basis, no fewer than five days of regular pay for jury service in San Mateo County, with jury pay being provided only for each day of actual jury service. The policy may provide that such employees deposit any fees received for such jury service with Contractor or that the Contractor may deduct from an employee’s regular pay the fees received for jury service in San Mateo County. By signing this Agreement, Contractor certifies that it has and adheres to a policy consistent with Chapter 2.85. For purposes of this Section, if Contractor has no employees in San Mateo County, it is sufficient for Contractor to provide the following written statement to County: “For purposes of San Mateo County’s jury service ordinance, Contractor certifies that it has no full-time employees who live in San Mateo County. To the extent that it hires any such employees during the term of its Agreement with San Mateo County, Contractor shall adopt a policy that complies with Chapter 2.85 of the County’s Ordinance Code.” The requirements of Chapter 2.85 do not apply if this Agreement’s total value listed in the Section titled “Payments”, is less than one-hundred thousand dollars ($100,000), but Contractor acknowledges that Chapter 2.85’s requirements will apply if this Agreement is amended such that its total value meets or exceeds that threshold amount.
13. Retention of Records; Right to Monitor and Audit
(a) Contractor shall maintain all required records relating to services provided under this Agreement for three (3) years after County makes final payment and all other pending matters are closed, and Contractor shall be subject to the examination and/or audit by County, a Federal grantor agency, and the State of California.
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(b) Contractor shall comply with all program and fiscal reporting requirements set forth by applicable Federal, State, and local agencies and as required by County. (c) Contractor agrees upon reasonable notice to provide to County, to any Federal or State department having monitoring or review authority, to County’s authorized representative, and/or to any of their respective audit agencies access to and the right to examine all records and documents necessary to determine compliance with relevant Federal, State, and local statutes, rules, and regulations, to determine compliance with this Agreement, and to evaluate the quality, appropriateness, and timeliness of services performed.
14. Merger Clause; Amendments
This Agreement, including the Exhibits and Attachments attached to this Agreement and incorporated by reference, constitutes the sole Agreement of the parties to this Agreement and correctly states the rights, duties, and obligations of each party as of this document’s date. In the event that any term, condition, provision, requirement, or specification set forth in the body of this Agreement conflicts with or is inconsistent with any term, condition, provision, requirement, or specification in any Exhibit and/or Attachment to this Agreement, the provisions of the body of the Agreement shall prevail. Any prior agreement, promises, negotiations, or representations between the parties not expressly stated in this document are not binding. All subsequent modifications or amendments shall be in writing and signed by the parties.
15. Controlling Law; Venue
The validity of this Agreement and of its terms, the rights and duties of the parties under this Agreement, the interpretation of this Agreement, the performance of this Agreement, and any other dispute of any nature arising out of this Agreement shall be governed by the laws of the State of California without regard to its choice of law or conflict of law rules. Any dispute arising out of this Agreement shall be venued either in the San Mateo County Superior Court or in the United States District Court for the Northern District of California.
16. Notices
Any notice, request, demand, or other communication required or permitted under this Agreement shall be deemed to be properly given when both: (1) transmitted via facsimile to the telephone number listed below or transmitted via email to the email address listed below; and (2) sent to the physical address listed below by either being deposited in the United States mail, postage prepaid, or deposited for overnight delivery, charges prepaid, with an established overnight courier that provides a tracking number showing confirmation of receipt.
In the case of County, to:
Name/Title: Cassius Lockett, Director of Public Health, Policy and Planning Address: 225-37th Avenue, Room 178
San Mateo, CA 94403
Telephone: 650.573.2532
Facsimile: 650.573.2788
Email: [email protected]
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In the case of Contractor, to:
Name/Title: President, PetData, Inc.
Address: 8585 N Stemmons Fwy, Suite 1100-N
Dallas, TX 75247
Telephone: 214.821.3100 x515
Facsimile: 214.821.3106
Email: [email protected]
17. Electronic Signature
Both County and Contractor wish to permit this Agreement and future documents relating to this Agreement to be digitally signed in accordance with California law and County’s Electronic Signature Administrative Memo. Any party to this Agreement may revoke such agreement to permit electronic signatures at any time in relation to all future documents by providing notice pursuant to this Agreement.
18. Payment of Permits/Licenses
Contractor bears responsibility to obtain any license, permit, or approval required from any agency for work/services to be performed under this Agreement at Contractor’s own expense prior to commencement of said work/services. Failure to do so will result in forfeit of any right to compensation under this Agreement.
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6/4/19
Resolution No. 076668
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Exhibit A
In consideration of the payments set forth in Exhibit B and with a focus on increasing licensing and vaccination compliance throughout the County of San Mateo, Contractor shall provide the following services:
A. Management of the daily operations for animal licensing including:
1. Data Entry & Processing
a. Process correspondence from pet owners including, but not limited to, issuing tags.
b. Work in partnership with the County on an approved template to provide timely billing and renewal notices to pet owners, with at least one billing to both new and renewals to be printed on an 8.5x11 sheet of paper with a return envelope enclosed. In addition, at least one of the notices will provide pet owner with the date in which the late fee became due.
c. Provide data entry of both new and renewal licenses and vaccination information. d. Implement procedures for verification of information submitted. e. Ensure complete, unduplicated, and accurate information. f. Process, collect, and provide receipts for animal licensing fees. g. Provide licensing and vaccination data for a weekly transfer of data from the Contractor’s database into County’s proprietary database. h. Provide customer service including communication with citizens, veterinarians, and designated County staff.
2. Veterinarians & Other Authorized Registrars
a. Process license sales and vaccination reports from other sources (i.e. the local animal shelter, veterinary clinics, pet stores, etc.)
b. Assist County staff to ensure reasonable quantities of on-site of basic supplies (reporting forms, citizen mailing envelopes, etc.) necessary to sell license tags and/or report information on citizens vaccinating their animals against rabies.
3. Animal License Tags
a. Process and mail county-provided license tags within a maximum of 10 business days, with a turnaround goal of 5 business days, after receipt of payment and completed information as required by the local ordinance. b. Issue county-provided replacement tags to pet owners whose license tags have been lost, stolen, or damaged.
4. Electronic Payments & Banking
a. Provide the ability for pet owners to pay through the Contractor’s Merchant Service Provider.
b. Provide on-line customer service via the Contractor’s website to allow pet owners to make license payments or donations.
c. Deposit all receipts collected for licensing into a bank account set up solely for the purpose of managing County animal licensing funds.
i. Make daily deposits and transmit verification of said deposits to designated County staff by the tenth of the following month.
ii. Collect and report electronic and charge card payments and transmit verification of said deposits to designated County staff by the tenth of the following month.
iii. Send all funds collected and deposited on behalf of the County via a monthly wire transfer by the tenth of the following month.
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d. Accept license fees from licensees via the following forms of payment at a minimum: check, money order, debit or ATM Card, or credit cards. i. Charges to Licensee for on-line payments:
Cost Recovery Processing Fees in the amount of $2.00 per on-line transaction to be charged to licensee*. Note: Contractor shall use their own designated Merchant Service Provider to conduct all credit card transactions and shall retain the Cost Recovery Processing Fees collected.
* More than one pet can be licensed per on-line transaction and pet owner will be charged a single fee for the on-line transaction.
5. Communication & Access
a. Provide timely responses to and communication with citizens, County designees, and Animal Control and Licensing Program representatives including Animal Control Officers.
b. Provide a customized San Mateo County toll-free number and answering service.
c. Provide 24/7 access to Contractor’s database by County, Emergency Dispatch, and any other authorized Division personnel, including login. d. Communicate to pet owners on the status of their pet’s license status including annual billing.
6. Reporting
a. Provide monthly report of animals licensed to the County. b. Provide statistical reports as requested by the County. c. Provide monthly report of all veterinarians who are delinquent in submitting their monthly vaccination without license (VWL) reports.
d. Provide monthly lists of delinquent licenses upon requested by County. e. Provide customized reports as requested by County. f. Provide public record information as requested by County.
7. Additional Services
a. Work in partnership with County staff:
i. To ensure all licensing information, both complete and incomplete records, are imported into Contractor’s database on a weekly basis. ii. To develop a process that will allow/entice veterinarians to sell licenses at their County location.
B. Contractor agrees that the animal licensing information belongs to the County and will never sell, transfer, or release personal data to a third party.
C. With the exception of the license tags and/or customized inserts, Contractor agrees to cover the cost of all animal licensing supplies needed for daily operation.
D. Contractor agrees to comply with California state and local laws governing animal licensing.
E. Contractor will back up all databases twice during the working day.
F. During regular business hours, Contractor will assist with countywide efforts to reunite pets with their owners during a natural disaster.
County agrees to provide the following to Contractor:
A. Access to County’s animal control database to allow import of data into Contractor’s database.
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B. Licensing tags and customized inserts to Contractor’s on-site location for disbursement.
C. Any licensing fees collected by County: such fees will be retained by County, and a record of fees collected along with any supporting documents will be forwarded to the Contractor for processing no later than the 5th calendar day of the following month.
D. Any licensing fees collected by Contractors of the County: such fees and any supporting documents will be forwarded to the Contractor for processing with the exception of cash.
Cash will be deposited into County’s bank account directly by County staff.
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Exhibit B
In consideration of the services provided by Contractor described in Exhibit A and subject to the terms of the Agreement, County shall pay Contractor based on the following fee schedule and terms:
A. Fixed Fees:
One-year license: $4.28 per license
Multi-year license: $4.28 for the first year and $2.00 for each additional year Late fees collected: $2.50 collection service fee for each license Replacement tags: $4.28 per tag
Service animals (e.g. seeing-eye dogs, hearing dogs, etc.): No fee for any license or tag issued
Fixed fees shall be payable to Contractor for all licenses processed during the term of this Agreement, regardless of whether they are processed by Contractor, County personnel, or a County contractor.
Fixed fees shall not be charged until the license is issued. Data entry of rabies vaccination certificates and incomplete licenses, which may or may not result in a license, are included at no extra charge.
An agreed upon method to follow-up with pet owners who did not respond to a prior notice is included at no additional charge.
B. In any event, the maximum amount the County shall be obligated to pay for services rendered under this Agreement shall not exceed SIX HUNDRED-THIRTEEN THOUSAND NINE HUNDRED AND FORTY FIVE DOLLARS ($613,945.00) (Included are bank fees)for the Agreement term.
C. Payment by County to Contractor shall be monthly and made be made electronically by the County should the required paperwork be completely by Contractor. Contractor shall bill County on or before the tenth (10th) working day of each month for the prior month. The invoice shall include a summary of services and charges for the month of service. In addition, Contractor shall provide back-up to the invoice. Such back-up shall be in the form of a monthly report of the animals licensed.
Contractor will provide available bank statements within five business days if requested by County.
D. Additional Service Fees
Contractor shall invoice County for any bank deposit and supply fees outside the scope of this Agreement.
County will reimburse Contractor for bank fees upon verification of such, including:
1. Actual bank fees charged to Contractor as a result of Contractor maintaining the bank account for the purpose of providing services outlined in this contract. This amount, in and of itself, is included in the total contract amount and will not exceed SEVEN THOUSAND AND FIFTY DOLLARS ($7,050.00) (included in the contracted costs) without prior authorization from designated County staff.
2. Non-sufficient fee charge charged to Contractor. Contractor will make every attempt to collect bank fees from pet owners and will reimburse County upon collection of said fee.
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Contractor shall invoice County on a monthly basis for the actual cost of the bank account maintained for the purpose of this contract.
E. At the discretion of the Director of Public Health, Policy & Planning or designee, an annual conference call may be scheduled between the Contractor and County. Contractor’s time and/or related expenses are not billable.
F. At the discretion of the Director of Public Health, Policy & Planning or designee, a meeting at the County’s location may be scheduled between the Contractor and County once during the term of this contract. Contractor’s travel time to and from the County and/or related expenses are not billable.
G. If County or Contractor finds that performance is inadequate, at the County’s discretion, a meeting may be called to discuss the causes for the performance problem, and this Agreement may be renegotiated, allowed to continue to end of term, or terminated pursuant to Paragraph 4 of this Agreement. Any unspent monies due to performance failure may reduce the following year’s agreement, if any.
H. In the event this Agreement is terminated prior to June 30, 2022, Contractor shall be paid for services already provided pursuant to this Agreement.
I. In the event this Agreement is extended or renewed after June 30, 2022 and the County does not issue a Request for Proposal, Contractor agrees to continue the fixed fees as shown below:
One-year license: $4.28 per license
Multi-year license: $4.28 for the first year and $2.00 for each additional year Late fees collected: $2.50 collection service fee for each license Replacement tags: $4.28 per tag
Service animals (e.g. seeing-eye dogs, hearing dogs, etc.): No fee for any license or tag issued
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Michael P. Callagy
County Manager/
Clerk of the Board
County Government Center
400 County Center, 1st Floor
Redwood City, CA 94063
650-363-4121 T
650-363-1916 F
www.smcgov.org
July 7, 2020
Ro
bert Barron, Finance Director
91 Ashfield Road
Atherton, CA 94027
Re: N
otice of Construction Costs for the Animal Care Shelter Facility De
ar Robert,
On o
r about September 9, 2014, the municipalities within San Mateo County entered into an agreement (“the Agreement”) to share the construction costs of a new animal care shelter facility. The agreement provides that the County of San Mateo will advance t he funds for construction to be repaid by the municipalities according to their share, through a 30 -year, interest-free lease agreement.
On Ma
rch 6, 2020, construction of the new animal shelter building was completed, and certificate of occupancy was is sued. The old shelter building was demolished shortly thereafter, and final project completion (with exception of photovoltaic installment) is slated for approximately July 30, 2020. Final project costs are reasonably determinable and anticipated to be approximately $28,300,000. The municipalities’ final shared responsibility is anticipated to be $25,700,000 or $856,758 annually. The County will not seek reimbursement for $2,600,000 in project costs comprised of an upgraded heating ventilation air conditioning ($600,000), a photovoltaic system ($1,200,000), miscellaneous site improvements related to landscaping, fencing, and parking ($530,000), and relocation of a City of Burlingame water line ($270,000).
The
final column of Attachment B to this lette r sets forth each municipalities’ final annual lease amount, as calculated in the manner proscribed by the Agreement. Final costs exceed the June 2018 estimate by approximately 3%. This marginal increase is a result of escalated regional construction costs and unforeseen circumstances encountered during construction, including requirements for ongoing air -quality monitoring, soil remediation and treatment, fire safety system modifications, PG&E delays, and necessary and reasonable end -user logistical desig n modifications. The County of San Mateo has worked diligently and successfully to minimize these additional costs while delivering a high-quality facility that will stand the test of time.
Attachment 3 - Memorandum of Agreement Regarding Funding For Construction Of An Animal Care Shelter
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Though we had to cancel the ribbon -cutting for the facility due to the pandemic, we look forward to holding, at the appropriate time, a reception to celebrate our successful regional collaboration. In lieu of an in-person tour, we’ve enclosed photographs of the exterior of the new facility and site. Pursuant to paragraph 3 of the Agreement, annual payments to County to reimburse for costs of construction shall become due on the initial July 1st after a certificate of occupancy is issued for the new shelter, and each subsequent July 1st for the next 29 years thereafter. Please find enclosed the invoice and payment instructions for the initial lease payment for your municipality.
Should you have any project questions, please contact Director Adam Ely of the Project Development Unit at 650.722.8112. Should you have any payment questions, please contact Robert Manchia at 650.363.4597.
Sincerely,
Mike Callagy
San Mateo County, County Manager
Enclosures: Resolution 073369, Final Attachment B, Invoice July 2020
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ATTACHMENT A
MEMORANDUM OF AGREEMENT
REGARDING FUNDING FOR CONSTRUCTION OF AN ANIMAL CARE SHELTER ON
AIRPORT BOULEVARD IN SAN MATEO, CALIFORNIA, AMONG THE CITIES OF
ATHERTON, BELMONT, BRISBANE, BURLINGAME, COLMA, DALY CITY, EAST
PALO ALTO, FOSTER CITY, HALF MOON BAY, HILLSBOROUGH, MENLO PARK,
MILLBRAE, PACIFICA, PORTOLA VALLEY, REDWOOD CITY, SAN BRUNO, SAN
CARLOS, SAN MATEO, SOUTH SAN FRANCISCO, AND WOODSIDE AND THE
COUNTY OF SAN MATEO
THIS MEMORANDUM OF AGREEMENT, dated for reference as of September 9, 2014 , (the
“Agreement”), is by and among the COUNTY OF SAN MATEO (the “County”), and the cities of ATHERTON, BELMONT, BRISBANE, BURLINGAME, COLMA, DALY CITY, EAST
PALO ALTO, FOSTER CITY, HALF MOON BAY, HILLSBOROUGH, MENLO PARK,
MILLBRAE, PACIFICA, PORTOLA VALLEY, REDWOOD CITY, SAN BRUNO, SAN CARLOS, SAN MATEO, SOUTH SAN FRANCISCO, AND WOODSIDE (each, a “City,” and collectively, the “Cities,” and, together with the County, the “Parties”).
RECITALS
The County and the Cities are parties to an Agreement for Animal Control Services dated as of April 26, 2011, pursuant to which the County provides animal control services in the unincorporated area of the County, as well as in the jurisdictional boundaries of the twenty Cities within the County, listed above, each of which is a party to the Agreement for Animal Control Services.
As set forth in the Agreement for Animal Control Services, the Peninsula Humane Society & SPCA (“PHS”) presently serves as the County Contractor for the provision of certain animal control services to the County and the Cities. These services and the terms of PHS’ performance of them are contained in an Animal Control Services Agreement between the County and PHS dated as of April 26, 2011.
In conjunction with and pursuant to the Animal Control Services Agreement, the County has leased to the PHS the land at 12 Airport Boulevard, in San Mateo, California, on which an Animal Care Shelter facility owned and operated by PHS is presently located.
The Parties agree that, owing to the obsolescence of the existing Animal Care Shelter facility, it is now necessary to construct a new facility and the Parties enter into this Agreement to set forth
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the allocation of, and process for payment of, the construction cost for the new Animal Care Shelter facility among the Parties.
NOW, THEREFORE, the Parties agree as follows:
1. Construction Cost Allocation Methodology: The Parties agree that construction costs for the new Animal Care Shelter facility shall be allocated among the Parties based on the formula set forth in Exhibit A to this Agreement, which is incorporated herein by reference. This formula reflects each Party’s actual use of the existing Animal Care Shelter facility in 2009, 2010, and 2011 as a percentage of all Parties’ total use of the facility, as well as each Party’s total population as of 2010, as a percentage of the County’s total population as of that date. The formula is weighted 80% to a City’s average facility use over the three years preceding the year in question and 20% to population. The Parties agree that each year, the County shall recalculate three year average facility usage for each City and that Exhibit A (and each Party’s prospective Lease Payment obligations, as described in Section 3 of this Agreement) shall be amended to reflect such recalculations. The Parties further agree that the County shall, upon request of a City, promptly provide the requesting City with copies of the data and documents used to calculate each City’s facilities usage.
2. County Advancing Construction Costs: The Parties agree that the County shall advance, on an interest free basis, all funds required to pay the construction costs for the new Animal Care Shelter facility. For purposes of this Agreement, “construction costs” include all expenses for architectural and inspector services, project management service, environmental review, planning and building fees and costs, and actual contractor construction services. The Parties understand and agree that construction costs for the Animal Care Shelter facility are anticipated at this time to be twenty million two hundred thousand dollars ($20,200,000). The Parties will be provided with further information regarding the construction costs for the Animal Care Shelter facility within a reasonable period of time after such information becomes available or prior to the Certificate of Occupancy being issued. The Parties agree that if the County receives information indicating that the construction costs for the Animal Care Shelter facility will exceed $20,200,000 by 10% or more, the County shall provide notice to each City of the revised estimated construction costs within a reasonable period of time before such additional construction costs are incurred. The Parties further agree that the County shall, upon request of a City, promptly confer with such City or Cities regarding the additional construction costs and any means by which such additional construction costs may be minimized.
3. Parties’ Payment of Proportional Share of Construction Costs: Each Party agrees that, during the term of this Agreement for as long as the new Animal Care Shelter facility is occupied and used for animal care shelter purposes, the Party shall pay the County an annual Lease Payment beginning on the first July 1
st after a certificate of occupancy is issued for the new Animal Care Shelter facility, and on each subsequent July 1 st for the next twenty nine years thereafter. Each Party’s Lease Payment shall be equal to the Party’s proportional share of the construction cost of the new Animal Care Shelter facility amortized on a straight line basis over thirty years, as set
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forth in Exhibit A to this Agreement, as Exhibit A may be amended from time to time as provided in Section 1 of this Agreement. Each Party’s obligation to make a Lease Payment shall remain in place only for so long as the Party is a signatory to the Agreement for Animal Control Services, or any successor agreement addressing materially the same subject matter. In the event that a Party terminates its participation in this Agreement pursuant to Section 4 of this Agreement, the County shall, upon receiving notice of that Party’s termination, recalculate the remaining Parties’ Lease Payment obligations pursuant to the Construction Cost Allocation Methodology set forth in Section 1 of this Agreement. The County shall promptly provide all remaining Parties with notice of their recalculated Lease Payment obligations. Each remaining Party shall thereafter have the option to either (a) pay the recalculated increased annual Lease Payments during the remaining term of the Agreement; or (b) request that the County allow the remaining Party a period of up to 5 years after the end of the thirty year period set forth in this Section 3 of the Agreement to pay the County the remaining Party’s additional allocated share of construction costs for the Animal Care Facility attributable to the departure of the terminating Party.
4. Term and Termination: Except as set forth above, this Agreement shall be effective for the period from September 9, 2014
until each Party has made the last payment required under Section 3 of this Agreement. Except as set forth in Section 3 of the Agreement (i.e., by terminating participation in the Agreement for Animal Control Services), no Party may terminate this Agreement during its term. A Party terminating its participation in this Agreement shall do so effective as of December 31 of a year during the term of this Agreement and shall provide each other Party to this Agreement with at least one full year’s prior written notice of the Party’s intent to terminate its participation in the Agreement.
5. Amendments/Entire Agreement: Amendments to this Agreement must be in writing and approved by the governing body of each Party. This is the entire agreement among the parties with respect to the construction of the new Animal Care Shelter facility and it supersedes any prior written or oral agreements with respect to the subject.
6. Hold Harmless: Each City shall hold harmless, indemnify, and defend County, its officers, employees, and agents from and against any and all claims, suits, or actions of every kind brought for or on account of injuries to or death of any person or damage to any property of any kind whatsoever and to whomsoever belonging which arise out of the performance or nonperformance of City’s covenants and obligations under this Agreement and which result from the actively negligent or wrongful acts of City or its officers, employees, or agents.
County shall hold harmless, indemnify, and defend each City, its officers, employees, and agents from and against any and all claims, suits, or actions of every kind brought for or on account of injuries to or death of any person or damage to any property of any kind whatsoever and to whomsoever belonging which arise out of the performance or nonperformance of County’s covenants and obligations under this Agreement and which result from the actively negligent or wrongful acts of County or its officers, employees, or agents.
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ATTACHMENT B
Methodology = Based on an 3-yr avg of shelter use (80%} and % of population (20%)
ANIMAL CONTROL COSTS
PROPOSED COST DISTRIBUTION-ESTIMATED LEASE AMOUNTS TO RECOUP CONSTRUCTION COSTS Overall Total Overall Total $26,600,000 $28,300,000
CITY Shelter Use Shelter Use Shelter Use $20,200,000 $24,800,000 $25,700,000 $856,758
Yr 1 2009 Actual Yr 2 2010 Actual Yr 3 2011 Actual
3 YR AVG of
Sheleter Use POPULATION % of Total
EST ANNUAL LEASE
AMT (Sept. 2014)
EST ANNUAL LEASE
AMT (July 2018)
EST FINAL
ANNUAL LEASE
AMT
(July 2020)
Atherton 1.12% 1.00% 0.36% 0.83% 6,914 1.0% $5,749 $7,059 $7,173 Belmont 3.26% 3.54% 2.65% 3.15% 25,835 3.6% $21 811 $26,780 $27,212 Brisbane 0.99% 0.99% 0.71% 0.90% 4,282 0.6% $5,633 $6,916 $7,028 Burlingame 3.51% 3.48% 320% 3.40% 28,806 4.0% $23,696 $29,095 $29,565 Colma 0.61% 0.98% 0.60% 0.73% 1,792 2.0% $4,268 $5,241 $5,325 Dalv Citv 8.52% 9.57% 10.16% 9.42% 101,123 14.1% $69,679 $85,556 $86,936 East Palo Alto 6.61% 6.75% 8.44% 7.27% 28,155 3.9% $44,420 $54,542 $55,422 Foster City 2.82% 2.39% 1.93% 2.38% 30,567 4.3% $18,550 $22,776 $23,144 Half Moon Bay 5.21% 5.04% 2.47% 4% 11,324 1.6% $24,962 $30,650 $31,144 Hillsborough 1.59% 129% 1.14% 1.34% 10,825 1.5% $9,247 $11,354 $11,537 Menlo Park 4.90% 4.95% 4.50% 4.78% 32,026 4.5% $31,769 $39,008 $39,637 Millbrae 1.90% 1.99% 1.98% 1.96% 21,532 3.0% $14,576 $17,897 $18,186 Pacifica 5.72% 6.38% 4.78% 5.63% 37,234 52.0% $37,288 $45,784 $46,523 Portola Valley 0.90% 0.76% 0.16% 0.61% 4,353 0.6% $4,084 $5,014 $5,095 Redwood City 12.91% 13.24% 13.25% 13.13% 76,815 10.7% $85,143 $104,543 $106,229 San Bruno 5.23% 5.19% 6.86% 5.76% 41,114 5.7% $38,734 $47,559 $48,326 San Carlos 3.35% 3.45% 3.00% 3.27% 28,406 4.0% $22,921 $28,143 $28,597 San Mateo 15.82% 14.67% 17.84% 16.11% 97,207 13.5% $105,000 $128,924 $131,004 S. San Francisco 9.08% 9.34% 11.99% 10.14% 63,632 8.9% $66,530 $81,689 $83,007 Woodside 4.41% 1.27% 1.07% 2.25% 5,287 0.7% $13,111 $16,098 $16,358 County 1.57% 3.73% 2.92% 2.74% 61,222 8.5% $26,235 $32,213 $32,732 HVAC +Solar Costs* n/a n/a n/a n/a n/a n/a n/a $1,800,000 $1,800,000 Burligame Waterline n/a n/a n/a n/a n/a n/a n/a n/a $270,000 Misc. Site Improvements n/a n/a n/a n/a n/a n/a n/a n/a $530,000 Total 100.00% 100.00% 100.00% 100.00% 718,451 100.00% $673,405 $826,843 $840,179 * HVAC, Solar, and Miscellaneous site improvement costs of $2.6 million removed from cities portion of costs and paid for by County of San Mateo. Overall total project cost is $28.3 million.
Resolution #073369
Calendar Year
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Accept the Fiscal Year (FY) 2025-26 Third Quarter Financial Report for the Period Ending March 31, 2026.
RECOMMENDATION:
Staff recommend that the City Council accept the Quarterly Financial Report (“Report”) for the third quarter of fiscal year (FY) 2025-26 ended March 31, 2026.
FISCAL IMPLICATIONS:
There are no fiscal implications, and no additional funding is needed.
BACKGROUND:
In May 2025, the City Council approved financial policies formalizing long standing practices. The policies were established to ensure that the City's finances are managed in a manner that will: (1) continue to provide for the delivery of quality services; (2) maintain and enhance service delivery as the community grows, in accordance with the General Plan; (3) guarantee a balanced budget annually assuring that the City is operating within its means; and (4) establish reserves necessary to meet known and unknown future obligations.
A key component of these policies includes the preparation of a quarterly financial report. This report provides an executive summary of the City’s current financial status as it relates to the adopted operating budget.
Attached is the Report for the third quarter that reflects the City’s overall General Fund financial position as of March 31, 2026. Included in the Report is an update on the General Fund balance, analysis of revenues earned to date, and expenses incurred for the third quarter of the fiscal year.
ANALYSIS:
Revenues
The Report for the third quarter is prepared on a cash basis, therefore only revenue received by March 31 is reflected. Since revenue is received on many different schedules depending on type, it is useful to compare the year-to-date (YTD) actual amounts to the prior year’s actual amounts.
Overall, fiscal year-to-date revenues were approximately $41.7 million, or $2.6 million and 6.8% higher than last year at the end of the third quarter and represented 67.6% of the budget. As discussed in the attached Report, vehicle in-lieu fees (VLF), and licenses and permits were lower
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than the prior year. The reduction is primarily due to fluctuating VLF backfill payments and the timing of development activity.
Property tax, sales tax, charges for services, other taxes, use of money and property, and other revenues were higher than at the same point last year. As detailed in the attached report, this increase reflects growth in assessed property values, strong performance in the business and industry sector and countywide pool, higher zoning and use permit fee activity, increased participation in recreation programs, modest gains in transient occupancy and franchise taxes, timely receipt of grants, higher rental revenues and interest income on investments, and continued strength in business registrations. Although we are seeing increases over the prior year, sales taxes are still expected to fall short of budget.
Expenditures
Expenditures are recorded when paid, using the cash-basis method of accounting. Overall, expenditures were $44.9 million, or 1.9 million and 4.4% higher than last year at the end of the third quarter and represented 66.9% of budget. This is primarily due to higher public safety contract costs and CalPERS contributions related to the legacy Belmont-San Carlos Fire Department, fewer staff vacancies, negotiated increases in salaries and benefits, an increase in professional services expenditures related to the Discovery Program for business registrations and instructor-led recreation programs, and higher equipment maintenance costs associated with implementing the new permit system. Further details are provided in the attached Report.
Further analysis and detail will be provided during the FY 2025-26 Mid-Cycle Budget review which is scheduled for June 22, 2026.
ALTERNATIVES:
The alternatives available to the City Council include:
1. Accept the Quarterly Financial Report for the third quarter of FY 2025-26 ended March 31, 2026; or
2. Do not accept the Quarterly Financial Report; or
3. Provide staff with alternative direction.
Respectfully submitted by:
Rebecca Mendenhall, Administrative Services Director
Approved for submission by:
___________________________________
Kathy Kleinbaum, City Manager
ATTACHMENT(S):
1. Q3 FY26 Financial Report
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CITY OF SAN CARLOS
Third Quarter of Fiscal Year 2025-26
The City has completed the third quarter of the fiscal year (FY) 2025-26 ended March 31, 2026. This report summarizes the activities of the City’s General Fund, which is the primary operating fund of the City and is used to account for most operating activities. This report is not meant to be inclusive of all finance and accounting transactions. It is intended only to provide the Council and the public with an overview of the state of the City’s general fiscal condition.
GENERAL FUND FINANCIAL POSITION
The General Fund is comprised of budgeted operating r evenues of $ 61,649,200 and operating expenditures of $67,069,325 for FY 2025-26. Expenditures in the General Fund account for direct services provided to the residents of San Carlos , including General Government services, Police s ervices, Fire services, Parks and Recreation, Community Development and Public Works.
TOP SEVEN GENERAL FUND REVENUES
The City’s seven main individual revenue source categories accounted for approximately 90.9% of the General Fund’s year-to-date total operating revenue in FY 2025-26, with all other revenues categorized under Other Revenue accounting for the remainder.
Overall, these key operating revenues largely performed as projected based on payment schedules , past trends, and the expect ation of continuing economic growth. Any significant variations in the different revenue categories compared to the third quarter of the prior year and the budget are noted below:
• Property tax. Most of the City’s property tax revenues are received in December and April. At the end of the third quarter, revenues were $903,000 higher compared to the same quarter last year.
GENERA L FUND FY 2024-2025 F Y 2025-2026
numbers in 000's
Revis ed
Budget
3rd Qtr
YTD Actual % of budget
Revis ed
Budget
3rd Qtr
YTD Actual % of budget
Revenues 57,243$ 39,063$ 68.2% 61,649$ 41,705$ 67.6% Expenditures 66,108 42,957 65.0% 67,069 44,863 66.9% Net Alloc & Transfers (579) (1,647) 284.5% (8,124) (6,093) 75.0% Net Change in Fund Balance (9,444) (5,541) 58.7% (13,544) (9,251) 68.3% Balance, Start of Year 58,985 58,985 100% 62,810 62,810 100% Balance Year-to-Date 49,541$ 53,444$ 107.9% 49,266$ 53,559$ 108.7% REV BY TYPE FY 2024-2025 FY 2025-2026
numbers in 000's
Revis ed
Budget
3rd Qtr
YTD Actual % of budget
Revis ed
Budget
3rd Qtr
YTD Actual % of budget
Property Tax 19,464$ 12,222$ 62.8% 20,970$ 13,125$ 62.6% Sales Tax 13,331 7,995 60.0% 12,519 8,471 67.7% Charges for Services 5,168 4,527 87.6% 6,678 4,584 68.6% Vehicle In Lieu 3,407 2,998 88.0% 3,611 2,847 78.8% Other Taxes 6,589 3,082 46.8% 6,626 3,133 47.3% Licenses & Permits 2,668 2,900 108.7% 3,214 2,347 73.0% Use of Money and Property 3,235 3,204 99.0% 4,814 3,400 70.6% Other Revenues 3,381 2,135 63.1% 3,217 3,798 118.1% Total Revenues 57,243$ 39,063$ 68.2% 61,649$ 41,705$ 67.6%
Quarterly Financial Report
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This increase is due to higher property values in San Carlos, as reported by San Mateo County.
We expect that property tax revenue will be on target with the budget this year. • Sales Tax. Revenues for the third quarter were $476,000 higher than the same period last year.
The increase was driven largely by strong growth in the countywide pool, which benefited from higher e‑commerce activity and technology ‑related business transactions. Statewide trends also showed solid results in value‑ oriented retail segments, helping offset declines in autos, construction, and other discretionary sectors. Although sales tax receipts are higher than last year, they are still expected to come in short of budget this year. • Charges for Services. Revenues were $57,000 higher than the same quarter last year, driven by increased zoning and use permit fees and higher revenue from recreation programs, including various classes offered by Parks & Recreation.
• Vehicle in -lieu (VLF). N o additional payments were received during the quarter . Year-to-date receipts are $151,000 lower than the same period last year. This is due to a lower first payment than in the prior year partially offset by a higher backfill payment relating to FY 2023-24 which was received in August . This revenue source can fluctuate significantly based on state decisions regarding backfill distributions to San Mateo County and its cities. The county has recently initiated a lawsuit to recover backfill amounts owed by the state from previous years. • Other Taxes. These include Transient Occupancy Tax (TOT) and franchise fees. Total revenue was $51,000 higher than in the third quarter of the prior year. The increase is primarily due to higher TOT revenues from the city’s hotels and franchise fee receipts from the City's waste collection service provider. The % of budget shows 47.3% achieved – this is due to the timing of cash receipts (quarter three revenues are received in April).
• Licenses & Permits . Revenues were $553,000 lower than at the same point last year. Building permits were the main reason for last year’s higher revenues which reflects the normal year‑to‑year variability of this category. Even with the lower year ‑over‑year comparison, current‑year revenues remain on track to meet the full‑year budget at 73% achieved. • Use of Money and Property. This revenue stream was $196,000 higher than at the same point last year due to interest earnings remaining strong coupled with increased revenues from the rental of billboards and city-owned buildings. This category is expected to be on budget for the full year. • Other Revenues. This revenue category includes business registration fees, vehicle code fines, various cost reimbursements , and grants. Revenue for the third quarter was $1,663 ,000 higher than in the same period last year, driven primarily by stronger business registration activity due to the discovery program audit initiated at the end of last year, and the timing of the Palo Alto Medical Foundation (PAMF) annual payment (approximately $912,000) which was received in quarter three this year and quarter four last year.
GENERAL FUND EXPENDITURES
In June 2025, the City Council approved several program changes and additional staffing changes for FY 2025-26 that were necessary to implement the strategic plan objectives, support the continued high level of development activity, manage the infrastructure projects, and advance the increased communication needs. As a result, t he total expenditures for the third quarter of the current fiscal year were 4.2% higher than last year. As shown in the table below, expenditures are tracking lower than budget for the third quarter year-to-date but given that the fourth quarter usually yields higher expenditures, the total is expected to be close to budget for the full year. Any significant variations are noted below.
• General Government. Expenditures were $200,000 higher than at the end of the third quarter of the prior year, driven in part by increased billboard sublease costs, professional services for the
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Discovery Program supporting business registration, and higher equipment maintenance costs associated with implementing the new permit system.
• Community Development. Expenditures were $1 37,000 less than the prior year due to the timing of professional services costs related to code enforcement, plan checks and key developments. • Fire. Expenditures were $674,000 higher than at the end of the third quarter of the prior fiscal year, primarily due to increased costs for contracted fire services from the City of Redwood City and a higher annual pension payment associated with the former Belmont–San Carlos Fire Department. • Police. Expenditures were greater than the same period last year by $ 380,000 due to the cost increases in the agreed law enforcement services contract with the San Mateo County Sheriff ’s Office and an increase in the annual pension payment to CalPERS. • Parks and Recreation. Expenditures were $127,000 higher than at the end of the third quarter of the prior year, primarily due to increased professional services supporting instructor ‑led recreation programs.
• Public Works. Expenditures increased by $662,000 compared to the prior year, primarily due to higher overall salary costs including the filling of the Assistant Public Works Director position towards the end of last year , as well as increased professional services for plan checks, inspections, and Civic Center maintenance.
• Salaries and benefits. Expenditures were $1,752,000 greater than at the end of the third quarter of last year due to fewer vacancies and increases in negotiated salary and benefit costs including the public safety legacy pension payments.
• Professional Services. Expenditures were $2 16,000 higher than the prior year at the end of the third quarter, primarily due to increased contract costs for Fire and Police services, partially offset by the timing of invoices for Community Development, General Government, and Public Works . • Other Operating. Expenditures were $54,000 lower at the end of the third quarter compared to the same period in the prior year. General Government costs such as billboard sublease expenses, equipment maintenance, and miscellaneous expenditures including office, field, and program supplies increased, but these were mor e than offset by lower crossing guard fees due to invoice timing, along with reduced utilities and special events insurance costs. • Capital Outlay costs were $8,000 lower than at the end of quarter three in the last fiscal year due to minor equipment purchases and fuel cost recharges.
FOR MORE INFORMATION
This summary is based on detailed information produced by the City’s Finance Division. If you would like additional information or have any questions about this report, please call (650) 802-4213.
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Accept the Fiscal Year (FY) 2025-26 Third Quarter Investment Report for the Period Ending March 31, 2026.
RECOMMENDATION:
Staff recommend that the City Council review and accept the Quarterly Investment Report (“Report”) for the third quarter of the fiscal year (FY) 2025-26 ending March 31, 2026.
FISCAL IMPLICATIONS:
There are no fiscal implications, and no additional funding is needed.
BACKGROUND:
On May 12, 2025, the City Council approved the Annual Investment Policy (“Policy”) per Resolution No. 2025-034. In accordance with the Policy, the City’s Administrative Services Director is responsible for investing the unexpended cash used for funding operations of the City of San Carlos (“City”).
The investment of funds for the City is directed by the goals of safety, liquidity, and yield. The authority governing investments for municipal governments is set forth in California Government Code, sections 53601 through 53686 (“Code”). Effective January 1, 2023, per section 53646 (b)(1) of the Code, the Investment Committee serving as the legislative body will have the quarterly reports for its review within forty-five (45) days following the end of the quarter. Thus, this Report and its attachments are furnished for review and information.
Beginning in FY 2016-17, the City included the checking account balance as part of this Report.
Although a checking account is not a typical investment account, this balance is included to show the total cash on hand for the quarter. The City typically maintains approximately $500,000 to $1 million, and a larger balance at the end of the calendar year, in the checking account to meet cash disbursement needs. Transfers are usually made into the investment accounts during the quarter to account for receipts that exceed disbursements.
The difference between historical value and market value of the City’s held investments, as shown in the attached investment report, may be due to the timing of purchase. Investments in the pools may have been purchased when interest rates were lower or higher than the end date of this report. As interest rates increase or decrease, the value of the investment pools will decrease or increase accordingly. However, interest rate fluctuations do not impact the City's balance in the investment pools. The market values are presented as a reference only.
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Investment Strategy
The City’s investment priorities, in order, are “safety, liquidity, and yield,” while meeting the cash flow needs of the City through prudent investment of unexpended cash.
Compliance with Policy
Historical cash flow trends are compared to current cash flow requirements on an ongoing basis to ensure the City’s investment portfolio will remain sufficiently liquid to enable the City to meet all reasonably anticipated operating requirements. As of March 31, 2026, the portfolio contains sufficient liquidity to meet the next six months of expected expenditures by the City.
As of March 31, 2026, the City has no investment instruments with a maturity date longer than one year. All investments are in highly liquid accounts, using the State of California and County of San Mateo investment pools, and follow the Policy.
The primary objective of the Policy of the City of San Carlos is “safety of principal”. The permitted investments section of the Policy also states:
Local Agency Investment Fund (LAIF), which is a State of California managed investment pool, and San Mateo County Investment pool, may be used up to the maximum permitted by California State Law. A review of the pool/fund is required when they are part of the list of authorized investments, with the knowledge that the pool/fund may include some investments allowed by statute but not explicitly identified in this investment policy.
The City’s Investment Committee, consisting of Kathy Kleinbaum, City Manager; Inge Tiegel, City Treasurer; and Rebecca Mendenhall, Administrative Services Director, has reviewed and approved this Report.
ANALYSIS:
The Investment Portfolio (Attachment 1) indicates that on March 31, 2026, City funds in the amount of $179,659,432 were invested, producing a weighted average yield of 3.94% for this quarter. The amount in the checking account was $1,306,345. The Local Agency Investment Fund (LAIF), the City’s benchmark for comparison of investment yield, was 3.88% for the quarter. The investment yield, net of administrative fees, for the County Pool was 3.99%. The allocation of the investment portfolio balance to various City funds and various sub-categories of General Fund fund balance is included on page 3 of the attachment. Below is a summary of the changes from the last quarter.
Quarter Ended
03/31/26
% of
Total
Quarter Ended
12/31/25
% of
Total
Increase
(Decrease)
City-Checking 1,306,345$ 1% 1,601,033$ 1% (294,688)$ City-SM County Pool 106,330,520 59% 109,557,941 60% (3,227,421) City-LAIF 73,328,912 41% 72,129,000 39% 1,199,912
Total 180,965,777$ 100% 183,287,974$ 100% (2,322,197)$ The portfolio balance at the end of the third quarter is $180,965,777, a decrease of $2,322,197.
The City draws on the investment portfolio throughout the year for normal operating activity typically with the more significant levels of draw occurring in the first quarter (July through September) and fourth quarter (April through June). The City’s cash position typically improves in
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late December and April due to the receipt of property tax collections from San Mateo County.
The decrease in the third quarter was due to the timing of the cash receipts and cash payments, largely driven by several major distributions:
$8 million payment to San Mateo County Sheriff’s Office for police services for the first three quarters of FY 2025-26;
$1.8 million operating expenditure contributions, bond interest, and cash-in-lieu of debt payments to Silicon Valley Clean Water; and
$2.6 million payment to Redwood City for fire and emergency services.
The drawdowns were partly offset by cash receipts from:
$3.1 million in sales taxes,
$2.3 million in property taxes,
$1.9 million in other taxes and revenues,
$1.7 million in interest,
$0.6 million in licenses and permits, and
$0.6 million in franchise fees.
Below is a comparison of quarterly cash position for the past three years.
Below is a summary of the changes in the total investment interest earnings from the prior quarter.
Qtr Ended
03/31/26
Qtr Ended
12/31/25
Increase
(Decrease)
Investment Portfolio 179,659,432$ 181,686,941$ (2,027,509)$ Weighted Avg Yield 3.94% 3.95% -0.01%
Accrued Interest Earnings 1,747,397$ 1,718,240$ 29,157$ The increase in interest earnings this quarter occurred due to the higher yield for the San Mateo County Pool (SMCP), which accounts for approximately 60% of the investment portfolio, despite the small dip in the interest rate for the Local Agency Investment Fund (LAIF). Interest in the investment accounts were $1,747,397 and $3,450 for the checking account. $140
$150
$160
$170
$180
$190
Sept 30 Dec 31 March 31 June 30
FY26
FY 25
FY 24
Cash Position of Investments
($ in millions)
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ALTERNATIVES:
The alternatives available to the City Council include:
1. Accept the Quarterly Investment Report for the third quarter of fiscal year 2025-26 as of March 31, 2026; or
2. Do not accept the Report; or
3. Provide staff with alternative direction.
Respectfully submitted by:
Rebecca Mendenhall, Administrative Services Director
Approved for submission by:
__________________________________
Kathy Kleinbaum, City Manager
ATTACHMENT(S):
1. Q3 Investment Portfolio Summary FY 2025-26
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CITY OF SAN CARLOS Historical GASB 31
Date Purchase Boo k % of Marke t Quarterly
Investment Type Account/CUSIP # Purchased Price ($) Qtr. Year-to-date Value ($) Portfolio Value ($)* Incom e
LIQUID ACCOUNTS
Checking Account 1,306,345$ 0.06% 0.06% 1,306,345 $ 1% 1,306,345 $ 3,450 $ Investment Accounts
San Mateo County Pool-City of San Carlos 106,330,520$ 3.99% 3.90% 106,330,520 59% 107,149,265 1,084,846 State of California LAIF-City of San Carlos 73,328,912$ 3.88% 4.07% 73,328,912 41% 73,327,506 662,551 Total Liquid Accounts 179,659,432 $ 3.94 % 3.97% 179,659,432$ 99 % 180,476,771$ 1,747,397 $ Total for City of San Carlos 180,965,777 $ 3.92% 3.94% 180,965,777 $ 100% 181,783,116 $ 1,750,847 $
* Notes:
2) Effective January 1, 2020, the LAIF deposit limit was increased from $65 million to $75 million. The limit remains in effect until updated by the State Treasurer. 1) Difference in value between Historical Value and Market Value may be due to timing of purchase. Investments in the investment pools may have been purchased when interest rates were lower or higher than the end date of this report. As interest rates increase or decrease, the value of the investment pools will decrease or increase accordingly. However, the interest rate fluctuations do not have an impact on the City's balance in the investment pools. The market values are presented as a reference only.
Yield
%
INVESTMENT PORTFOLIO
CITY OF SAN CARLOS
March 31, 2026
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Investment Portfolio Diversification
City of San Carlos Checking Account 1,306,345 $ 1% City of San Carlos SM County Pool 106,330,520 59% City of San Carlos LAIF-General 73,328,912 41% Total 180,965,777 $ 100%
City - Checking
1%
City - SMC Pool
59%
City - LAIF
40%
City - Checking City - SMC Pool City - LAIF
City of San Carlos
Investment Portfolio
as of March 31, 2026
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Funds Cash Balance
% of Total
Balance
Capital Projects Funds (Fund 10, 14, 16, 18, 25, 26 and 27) 78,877,273$ 43.6% Sewer Fund (Fund 6) 50,769,578 28.1% Housing Funds (Funds 29 and 31) 9,954 0.0% Facility/Infrastructure Improvements 17, 642,500 9.7% General Fund Operations (includes checking account) 1,021,491 0.6% Unfunded Liabilities 3, 000,000 1.7% Economic Uncertainties Reserve 9,846,816 5.4% Assigned Property Acquistion 2,000,000 1.1% Strategic Property Acquisition 7, 144,220 3.9% Restricted by contract or outside party 5,781,742 3.2% Special Revenue Funds (Funds 15 and 17) 1,163,488 0.6% Internal Service Funds (Funds 32, 33, and 35) 3,708,715 2.0% Total 180,965,777$ 100.0%
City of San Carlos
Investment Allocations
as of March 31, 2026
44%
28%
0%
10%
0%
2%
5%
1%
4%
3%
1% 2%
Capital Projects Funds (Fund 10, 14, 16, 18, 25, 26 and 27) Sewer Fund (Fund 6) Housing Funds (Funds 29 and 31) Facility/Infrastructure Improvements General Fund Operations (includes checking account) Unfunded Liabilities Economic Uncertainties Reserve Assigned Property Acquistion Strategic Property Acquisition Restricted by contract or outside party Special Revenue Funds (Funds 15 and 17) Internal Service Funds (Funds 32, 33, and 35)
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City of San Carlos Investment Portfolio
Mar-24 Jun-24 Sep-24 Dec-24 Mar-25 Jun-25 Sep-25 Dec-25 Mar-26 City - Checking 2,521,232 1,888,533 3,001,417 4,941,377 1,146,208 1,215,591 2,004,134 1,601,033 1,306,345 City - SM County Pool 111,771,738 109,670,755 101,170,418 101,449,858 109,827,080 109,320,683 100,607,085 109,557,941 106,330,520 City - LAIF 73,221,839 72,694,145 67,225,571 73,903,796 71,758,513 73,163,020 73,962,704 72,129,000 73,328,912 Total 187,514,809$ 184,253,433 $ 171,397,406 $ 180,295,031 $ 182,731,801 $ 183,699,294 $ 176,573,923 $ 183,287,974 $ 180,965,777 $ 0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Mar-24 Jun-24 Sep-24 Dec-24 Mar- 25 Jun-25 Sep-25 Dec-25 Mar-26 City of San Carlos Historical Summary of Investment Portfolio City - Checking
City - LAIF
City - SM County
Pool
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Investment Accounts Mar-24 Jun-24 Sep-24 Dec-24 Mar-25 Jun-25 Sep-25 Dec-25 Mar-26 San Mateo County Pool-City of San Carlos 3.19% 3.39% 4.18% 3.94% 3.89% 3.99% 4.01% 3.86% 3.93% State of California LAIF-City of San Carlos 3.62% 3.82% 4.63% 4.34% 4.39% 4.32% 4.14% 4.01% 3.88% Annualized Rate of Return
CITY OF SAN CARLOS
INVESTMENT ANNUALIZED RATE OF RETURN
March 31, 2026
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
5.00%
Mar-24 Jun-24 Sep-24 Dec-24 Mar- 25 Jun-25 Sep-25 Dec-25 Mar-26 Investment Annualized Rate of Return
San Mateo County Pool-City of San Carlos State of California LAIF-City of San Carlos
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Adopt a Resolution Authorizing the Execution of a Professional Services Agreement with Integrated Communication Systems (ICS) in the Amount of $370,703, with a 10% Contingency in the Amount of $37,072, for a Not-to-Exceed Total Contract Amount of $407,775 to Upgrade the Existing Council Chambers’ Audio Visual (“A/V”) Systems to Support Modern, Reliable Operations and Request the Appropriation of Restricted Public, Educational, and Government (PEG) Funds from the General Capital Fund (Fund 25) for this New Capital Project.
RECOMMENDATION:
Staff recommend the City Council adopt a Resolution authorizing the execution of a professional services agreement with Integrated Communication Systems (ICS) in the amount of $370,703, with a 10% contingency in the amount of $37,072, for a not-to-exceed total contract amount of $407,775 to upgrade the existing City Council chambers’ audio visual (“A/V”) systems to support modern, reliable operations and request the appropriation of restricted Public, Educational, and Government (PEG) funds from the General Capital Fund (Fund 25) for this new capital project.
FISCAL IMPLICATIONS:
An appropriation of $407,775 from the Public, Educational and Government (PEG) restricted reserve in the General Capital Fund (“Fund 25”) is required to complete this A/V system upgrade capital project. There are sufficient funds in the reserve to cover the total cost of this project.
PEG funds are collected by the City through franchise fees paid by cable providers (e.g., Comcast) and are restricted for use on capital costs related to government access broadcasting, including equipment and infrastructure such as the council chambers’ A/V systems.
Use of PEG funds allows the City to modernize the council chambers’ A/V system without impacting the General Fund. However, PEG funds cannot be used for ongoing operational costs such as maintenance, staffing, or future lifecycle replacement, which will be absorbed within existing departmental budgets. As of May 15, 2026, the balance of PEG funds available for this project is $473,945.
The total estimated project cost is $407,775, which includes the base proposal amount of $370,703 and a 10% contingency of $37,072.
BACKGROUND:
The City Council’s chambers serve as the primary venue for City Council and Planning
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Commission meetings and are equipped with A/V systems to support presentations, public participation, and government access broadcasting.
The chambers underwent a major remodel in 2014, which included installation of A/V infrastructure to support council operations. Since that time, the system has been maintained through incremental upgrades and component replacements to address evolving operational needs and equipment failures.
Over time, this approach has resulted in a mix of legacy and newer technologies that are not fully integrated. As equipment ages, several components have become obsolete or are approaching end-of-life, prompting the need for a comprehensive evaluation of the system.
ANALYSIS:
Under Section 3.12.260 E.3. of the City’s Municipal Code, the City Council may authorize award and execution of service contracts in excess of seventy-five thousand dollars with no competitive proposals where experience with the proposed service provider has demonstrated competence and satisfactory performance or in the renewal or renegotiation of existing contracts for continuing services.
Staff recommend using a sole source procurement for this agreement because the vendor possesses specialized expertise and institutional knowledge related to the City’s existing equipment, configuration, and operational requirements. The City Council previously approved a sole source agreement with Integrated Communication Systems (ICS) at the October 26, 2020 City Council meeting for Council chamber audio visual system upgrades. ICS previously installed and integrated the current system and has performed subsequent upgrades and maintenance.
Utilizing the same vendor ensures compatibility with existing infrastructure, minimizes operational risk, reduces implementation time, and avoids unnecessary costs associated with redesign, reconfiguration, or transition to another provider.
The City Council chambers’ A/V system was last comprehensively upgraded as part of the 2014 Council Chamber Remodel project by ICS, which included installation of audio, visual, and related infrastructure systems to support Council operations. Since that time, various components have been added, replaced, or modified to address operational needs and equipment failures. While these incremental updates have extended the usability of the system, they have resulted in a mix of legacy and newer technologies that are not fully integrated and are increasingly difficult to support and maintain.
Many components have now become obsolete or are approaching end-of-life. Several are no longer supported by manufacturers, increasing the risk of failure, limiting the availability of replacement parts, and reducing overall system reliability. As a result, the current system requires increasing effort to maintain and is more susceptible to disruptions during meetings. In addition, the upgrade will support the City’s ability to continue to meet California Senate Bill 707 (SB 707) requirements for public participation, including remote access and accessibility accommodations.
Recent evaluations identified the need to replace aging components and modernize the system, including upgrades to audio, video, control, and assistive listening systems. While prior concepts included highly integrated and complex solutions, staff recommend a more streamlined approach that focuses on reliability, ease of use, and long-term sustainability.
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The proposed upgrades include the following:
1. Replacement of the existing multi-screen display system with a single large-format LED video wall to improve visibility, simplify content management, and provide a more modern and reliable presentation system.
2. Modifications to the existing podium to make it mobile and easier to reposition for different meeting configurations and community uses.
3. Replacement of end-of-life microphones, control systems, assistive listening equipment, and related A/V infrastructure to improve overall reliability and usability.
All work completed will carry a one-year warranty and general maintenance support beyond that will be covered by the City’s existing on-call maintenance contract with ICS.
Given the age, fragmentation, and obsolescence of the current system, a comprehensive upgrade represents the most reliable and cost-effective path forward.
ALTERNATIVES:
The alternatives available to the City Council include:
1. Adopt a Resolution authorizing the execution of a professional services agreement with ICS in an amount of $370,703, with a 10% contingency in the amount of $37,072, for a not-to-exceed total contract amount of $407,775 to upgrade the existing City Council chambers’ A/V systems to support modern, reliable operations and request the appropriation of restricted PEG funds from Fund 25 for this new capital project; or
2. Do not adopt the Resolution; or
3. Provide staff with alternative direction.
Respectfully submitted by:
Rebecca Mendenhall, Administrative Services Director
Approved for submission by:
_______________________________
Kathy Kleinbaum, City Manager
ATTACHMENT(S):
1. Resolution
2. ICS Quote for Services
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RESOLUTION NO. 2026 – ____
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS
AUTHORIZING THE EXECUTION OF A PROFESSIONAL SERVICES AGREEMENT WITH INTEGRATED COMMUNICATION SYSTEMS (ICS) IN THE AMOUNT OF $370,703, WITH A 10% CONTINGENCY IN THE AMOUNT OF $37,072, FOR A NOT-TO-EXCEED TOTAL CONTRACT AMOUNT OF $407,775 TO UPGRADE THE EXISTING COUNCIL CHAMBERS’
AUDIO VISUAL (A/V) SYSTEMS TO SUPPORT MODERN, RELIABLE OPERATIONS AND
REQUEST THE APPROPRIATION OF RESTRICTED PUBLIC, EDUCATIONAL, AND GOVERNMENT (PEG) FUNDS FROM THE GENERAL CAPITAL FUND (FUND 25) FOR THIS NEW CAPITAL PROJECT.
WHEREAS, the City of San Carlos utilizes audio visual (A/V) systems in the City Council chambers to support public meetings, presentations, and government access broadcasting; and WHEREAS, the Council chambers’ A/V system was last comprehensively upgraded in 2014, and since that time components have been incrementally added or replaced, resulting in a system comprised of mixed technologies; and
WHEREAS, many components of the existing A/V system have become obsolete or are approaching end-of-life, are no longer supported by manufacturers, and present increasing risks to system reliability; and
WHEREAS, the scope of the proposed project includes replacement of obsolete equipment, modernization of audio, video, and control systems, and implementation of a simplified and reliable configuration to support ongoing Council operations, accessibility requirements, and compliance with California Senate Bill 707 (SB 707); and
WHEREAS, the total estimated cost of the A/V system upgrades is approximately $407,775, which includes the base proposal amount of $370,703.00 and a 10% contingency. Funding will be supported through available Public, Educational, and Government (PEG) access funds, which are collected through cable franchise agreements and restricted for capital costs related to government access broadcasting equipment and infrastructure.
NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council hereby authorizes the execution of a professional services agreement with Integrated Communication Systems in an amount of $370,703, with a 10% contingency in the amount of $37,072 for a not- to-exceed total contract amount of $407,775 to upgrade the existing Council chambers’ A/V systems to support modern, reliable operations and request the appropriation of restricted PEG funds from the General Capital Fund for this new capital project. * * * * *
I, City Clerk Crystal Mui, hereby certify that the foregoing Resolution was duly and regularly passed and adopted by the City Council of the City of San Carlos at a scheduled meeting thereof held on the 26th day of May 2026, by the following vote:
AYES, COUNCILMEMBERS:___________________________________________ NOES, COUNCILMEMBERS:___________________________________________
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ABSENT, COUNCILMEMBERS:___________________________________________ ________________________________
CITY CLERK of the City of San Carlos
APPROVED:
___________________________
MAYOR of the City of San Carlos
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6680 Via Del Oro, San Jose, CA 95112 Tel 408 491-6000 Fax 408 998-0100 California Contractor License Number C-10 814203
INTEGRATED COMMUNICATION SYSTEMS
City of San Carlos
600 Elm St.
San Carlos, CA 94070
To: City of San Carlos
Attention: William Hoch
Date: 5/1/26
From: ICS- Alonzo Madrid
Subject: Chambers AV upgrade
William,
Integrated Communication Systems (ICS) is submitting this proposal for audiovisual system equipment, engineering, installation, commissioning and training for multiple AV upgrades for current AV system for City of San Carlos Chambers located at 600 Elm St, San Carlos, CA 94070.
ICS Project Implementation Overview:
General:
ICS will execute the work in accordance with the terms and conditions of the final contract. The general scope of work and project clarifications and exclusions are listed in this document. This proposal includes the following rooms/systems:
• Chambers
Changes to Contract Scope:
Additional work requested by the customer, or consultant that is not included in the scope of work herein, will require a written change order to the contract with the appropriate compensation and time adjustments for the change in scope. Changes to the contract shall be processed in writing to ensure all involved parties fully understand any technical, cost, and scheduling impacts that may result.
Project Organization:
ICS’ technical team will be responsible for the installation of the project and to ensure customer satisfaction. The Project Manager will be responsible for the day-to-day management of the project. The Lead Installer will be responsible for the day- to-day management of the project job site.
Quality and Safety:
ICS’ team will ensure that all work performed is to the quality standards specified and all safety standards are met in accordance with the General Contractor requirements for on-site work. ICS’ union technicians will perform on-site installation of field cabling and equipment and system testing.
Testing and Commissioning:
ICS’ technicians will test and verify the proper operation of each system, including all hardware and software provided and installed by ICS.
Scope of Work Overview:
General
• ICS will provide all cables, connectors, and miscellaneous hardware as required for a complete and functioning system.
• ICS will provide all programming and configuration required for a functioning system.
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• ICS will use all existing broadcasting equipment and camera system. o All equipment will be moved into a central rack location. o ICS will ensure all features of broadcasting and camera system are brought over to all new AV components.
Chambers Video Wall Replacement – ICS will remove current (8) 55-inch LCD displays and install (1) Absen KLCOB1.2 V2
1.25mm Video Walls in their place.
• Install and provide (1) KLCOB1.2 V2 1.25mm LED video wall o ICS will configure and program the LED video wall to operate as one continuous display surface from right to left, while allowing the wall to function as three large logical display areas. The system will support displaying a single seamless image across the entire video wall or routing different content sources to each section, selectable via touch panel button press.
o ICS will provide and install (1) Netgear 24 Port POE switch. o This unit will be installed to replace the current Crestron Video Switcher that is EOL. The New Video Switched will all be done by Crestron NVX network switching. • ICS will provide and install (3) HDMI input plates at the dais to allow users to share content directly to the system. o Clients will be able to plug in HDMI cable via laptop and share content controlled by touch panel and or auto recognition.
• ICS will provide and install (8) new HD 4K Monitors for the staff at the dais location. o All the content shared in the meeting will be displayed on these displays. o The Crestron NVX platform will manage the appropriate scaling and aspect ratio for the individual monitors.
o The end user will have the ability to zoom in and out on each monitor at the dais. • ICS will provide and install (1) Crestron Digital Graphics Engine. o This unit will allow ICS to program on screen timer for everyone to see in person or remotely. o End users will have the ability to edit, start and stop timer via touch panel.
New Camera – ICS will install (1) Additional PTZ Camera to allow for another angel to be viewed in the Chambers AV system. o ICS will provide and install (1) New PTZ Camera in desired location. o ICS will program this new camera to allow it to use a video source of meetings. o ICS will work with end users to discuss location where they want the camera to be located. o Camera angel will be controlled by panel and control booth.
Chambers Audio Replacements – ICS will remove current (9) microphones that are EOL, Remove QSC Core 250i that is EOL, Remove Shure Handheld and Bodypack microphones that are EOL. • Install and provide (9) Shure MX418 D/C microphones.
o All microphones will be replaced at the dais location and the podium. ▪ These new microphones will be 18-inch stems and provide a better pick-up pattern to end-users. ▪ ICS will provide all these units to be controlled by the touch panel. ▪ These units are in stock and replaceable in case anything needs to be replaced. • ICS will provide and install (1) QSC Core 510i
o The current unit is EOL and should nothing fail, the unit will need to be replaced. ▪ The new core will be installed and programmed to hand all the microphones in the system so no feedback will enter the system.
▪ ICS will also recommission the entire sound system once this new DSP has been installed, programmed and tested.
• ICS will provide and install (4) New Shure Handhelds and (4) Shure Bodypack Micro flex NXT network-based microphone system.
o The current wireless microphone system has reached EOL and will need to be replaced should any components fail.
o The new microphones will run off rechargeable batteries. The devices will live on an 8port dock that charges units when not in use. The units will have a total of 12 hours of running time per full charge.
Chambers Control Replacements – ICS will remove current (2) Touch Panels that have reached EOL, Remove current Pro3 Control processor.
• ICS will remove current Crestron Touch Panels that have reached EOL. Install (1) Crestron 10.1 Inch Touch panels in the control booth and (1) 10.1 Inch Wireless touch panel at the Clerk Location. The wireless panel will be able to be moved around in the event a non-council meeting is being held. o ICS will modify and simply all the controls currently in space. o ICS will program the space to be able to start up in different modes.
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o ICS will make a layout on the touch screen that mimics the chambers to allow for easy functionality when sourcing to video wall or controlling microphones.
• ICS will remove existing Pro 3 Crestron Control Processor that has reached EOL and install New Crestron CP4N control processor.
o This device will improve the overall performance of the system and provide ICS with the ability to control all aspects of the AV system.
• ICS will provide and install (1) New workstation for control booth. o The workstation will have monitors mounted to desktop. o All equipment will be routed to desk and easy to access for service needs.
Assisted Listening Dante System – ICS will remove the existing legacy radio‑frequency Assistive Listening System (ALS) and install a new Listen Technologies Wi‑Fi–based assistive listening system utilizing Dante audio networking. • ICS will furnish and install (1) Listen Technologies LWS‑04B‑W1‑D 2‑Channel Wi‑Fi Assistive Listening System with (4) Wi‑Fi receivers.
o ICS will integrate the system using Dante audio, routing digital audio directly from the house sound system to the assistive listening system.
o ICS will test and verify system operation, audio quality, and reliability. o ICS will provide basic system orientation to staff covering receiver usage, charging, and general operation.
Mobile Podium – ICS will wire all devices in podium, so when needed all that will be required is to connect CAT6 Cable into floor box.ICS will install wheels to the current podium. • The coil can be disconnected when needed to be moved.
Price per Scope as Above:
Includes; equipment as listed, installation labor, materials & hardware, shipping fees:
Total Price: $ 370,703.00
ICS Scope of Work, Clarifications and Exclusions of this Proposal:
1. ICS provides a standard 1-year system warranty on new equipment supplied by ICS, along with our system installation workmanship. System warranty begins at substantial completion and sign off date.
2. Any Owner Furnished Equipment (OFE) including racks, speaker, all cabling infrastructure and any other reused equipment is not covered under any ICS warranty.
3. All owner-furnished reused equipment are also assumed to be fully functional. If this is not the case additional charges will apply.
4. The new video wall and roll‑down LED projection screen will require dedicated electrical power, structural backing, and infrastructure support. All required electrical power, conduit, junction boxes, structural blocking, wall reinforcement, and backing necessary to support the video wall and roll‑down LED screen shall be provided by others.
5. ICS will provide detailed requirements, drawings, and specifications identifying power, structural, and infrastructure needs for the video wall and roll‑down screen.
6. ICS makes ever attempt to insure that product is actually available as quoted or “In Stock” at the time of bid or proposal submission. Given current supply and demand issues, ICS has experienced situations where promised product(s) are no longer available in the time frame quoted or OEM shipments are delayed for reasons outside our control. ICS will do its best to keep these interruptions to a minimum, but ICS cannot be held responsible for delays associated with product deliveries that are outside our control.
7. This proposal is based on work performed by ICS occurring during normal business hours, Monday through Friday, 7:00am to 3:30pm, excluding observed holidays.
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6680 Via Del Oro, San Jose, CA 95112 Tel 408 491-6000 Fax 408 998-0100 California Contractor License Number C-10 814203
8. ICS is signatory to the IBEW, Sound and Communications Santa Clara County Union Local #332
Schedule:
This quote is valid for 30 days from date generated.
ICS Payment Terms:
At contract, net 30 days are typical on progressive invoices billed monthly.
ICS Limited Warranty Statement:
Subject to the terms and conditions of this Limited Warranty, Integrated Communication Systems (ICS) warrants to the original purchaser of this Audiovisual System, that:
New components provided and installed by ICS are warranted for a period of one (1) year to the original owner/purchaser of the system. If any component proves defective in material or manufacturing workmanship for a period of one (1) year from the date of substantial completion, ICS will replace the defective component without charge. Replacement components are warranted for the remainder of the original 1-year warranty period.
ICS prefers to proceed on quoted work orders with signed approval and/or a purchase order. Approved work orders can be emailed to [email protected]
Submitted By: Alonzo Madrid Approved By _______________________
Date: 5/5/26 Print Name: ________________________
Job Total: $370,703.00 Date Approved: ___________________
If you have any questions or concerns, please contact me by phone or email.
Sincerely,
Alonzo Madrid
Project Manager
Alonzo Madrid
Digitally signed by Alonzo Madrid
DN: C=US, [email protected],
O=Integrated Communication Systems, OU=Service
Manager, CN="Alonzo Madrid "
Date: 2026.05.05 08:52:35-07'00'
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Adopt a Resolution Authorizing the Execution of an Amendment to the Existing Professional Services Agreement with Wallace Roberts & Todd, LLC (WRT) for Additional Services Associated with the Preparation of Graphics and Upgraded Renderings for the Downtown Groundbreaking Celebration in an Amount Not to Exceed $19,715.
RECOMMENDATION:
Staff recommend that the City Council adopt a Resolution authorizing the execution of an amendment to the existing professional services agreement with Wallace Roberts & Todd, LLC (“WRT”) for additional services associated with the preparation of graphics and upgraded renderings for the Downtown groundbreaking celebration in an amount not to exceed $19,715.
FISCAL IMPLICATIONS:
There are no fiscal implications, and no additional funding is needed. The costs in the amount of $19,715 to prepare graphics and upgraded renderings for the Downtown groundbreaking celebration are funded by the fiscal year (FY) 2025-26 Advance Planning Professional Services Budget.
BACKGROUND:
The following table provides an account of amendments to the original, 2023 contract with WRT in reverse chronological order.
DATE/REQUEST AMOUNT RESOLUTION # FUNDS
May 26, 2026 –
Preparation of Graphics and
Upgraded Renderings
$19,715 TBD Advance Planning,
Professional Services
01191001 - 520320
January 2026 –
Extended Services/Timeline
$69,900 2026-013 CIP Fund C2105
October 28, 2024 –
Design/Engineering Phase
1A&1B
$1,535,134 2024-114 CIP Fund C2215
June 24, 2024 –
Engineering Surveys
$207,529 2024-077 CIP Fund C2215
August 28, 2023 –
Prepare Downtown Specific Plan
and Streetscape Master Plan
$877,267 2023-106 CIP Fund C2105
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The purpose of this request is to authorize an amendment to the WRT contract to add a scope of services that provided additional services to prepare graphics and upgraded renderings for the Downtown groundbreaking celebration.
ANALYSIS:
Scope of Work. Additional funds in the amount of $19,715 will supplement existing work with the following tasks:
1. Project management, review previous renderings, internal team coordination
2. Two virtual meetings with city staff, selection of vantage points
3. Develop three, 4 ft. x 6 ft. display boards
4. Prepare final renderings
5. Coordination, meetings with internal team, City staff The addendum would increase the current contract with WRT by an additional $19,715.
ALTERNATIVES:
The alternatives available to the City Council include:
1. Adopt a Resolution authorizing the execution of an amendment to the existing agreement with WRT for additional services related to the preparation of graphics and upgraded renderings for the Downtown groundbreaking celebration; or
2. Do not adopt the proposed Resolution; or
3. Provide staff with alternate directions.
Respectfully submitted by:
Al Savay, Community Development Director
Approved for submission by:
____________________________
Kathy Kleinbaum, City Manager
ATTACHMENT(S):
1. Resolution
2. Proposed Addendum to Agreement for Professional Services
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RESOLUTION NO. 2026 – ____
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS
AUTHORIZING THE EXECUTION OF AN AMENDMENT TO THE EXISTING
PROFESSIONAL SERVICES AGREEMEMENT WITH WALLACE ROBERTS & TODD, LLC (“WRT”) FOR ADDITIONAL SERVICES ASSOCIATED WITH THE PREPARATION OF
GRAPHICS AND UPGRADED RENDERINGS FOR THE DOWNTOWN GROUNDBREAKING CELEBRATION IN AN AMOUNT NOT TO EXCEED $19,715.
WHEREAS, on August 28, 2023, the City Council unanimously voted to adopt Resolution No. 2023-106 authorizing the City Manager to enter into a professional services agreement with WRT to prepare a Specific Plan and Streetscape Master Plan for San Carlos’ Downtown for an amount not to exceed $877,267; and
WHEREAS, on June 24, 2024, the City Council unanimously voted to adopt Resolution No. 2024-077 authorizing the execution of an amendment to the existing Professional Services Agreement with WRT for additional consulting services for engineering survey work in the amount of $207,529; and
WHEREAS, on October 28, 2024, the City Council unanimously voted to adopt Resolution No. 2024-114 authorizing the execution of an amendment to the existing Professional Services Agreement with WRT for additional consulting services for design engineering drawings for Phase 1A – Harrington Park and Phase 1B – 700 Block of Laurel Street, in the amount of $1,535,134; and
WHEREAS, on January 26, 2026, the City Council unanimously voted to adopt Resolution No. 2026-013 authorizing the execution of an amendment to the existing Professional Services Agreement with WRT for additional consulting services related to the extended timeline to complete the Downtown Specific Plan for an amount of $69,900; and
WHEREAS, this request would further amend the existing contract with WRT for additional services related to the preparation of graphics and upgraded renderings for the Downtown groundbreaking celebration for an amount of $19,715.
NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council hereby authorizes the execution of an amendment to the existing professional services agreement with WRT for additional services associated with the completion graphics and upgraded renderings for the Downtown groundbreaking celebration in an amount not to exceed $19,715. * * * * *
I, City Clerk Crystal Mui, hereby certify that the foregoing Resolution was duly and regularly passed and adopted by the City Council of the City of San Carlos at a scheduled meeting thereof held on the 26th day of May 2026, by the following vote:
AYES, COUNCILMEMBERS:
NOES, COUNCILMEMBERS:
ABSENT, COUNCILMEMBERS:
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________________________________
CITY CLERK of the City of San Carlos
APPROVED:
___________________________
MAYOR of the City of San Carlos
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Addendum to Agreement 1 Revised: 05/07/2026
ADDENDUM TO AGREEMENT FOR PROFESSIONAL SERVICES
THIS ADDENDUM TO THE AGREEMENT FOR PROFESSIONAL SERVICES is made to the Agreement for PROFESSIONAL SERVICES dated August 28, 2023, by and between the CITY OF SAN CARLOS, hereinafter referred to as “CITY”, and WALLACE ROBERTS & TODD (WRT), LLC, hereinafter referred to as “CONSULTANT” and shall accept the attached amended Exhibit A. In all other respects the terms and conditions in the contract dated August 28, 2023 shall remain in full force and effect.
IN WITNESS WHEREOF, the Parties heret o have caused this Agreement to be executed on the date first written by their respective officers duly authorized in that behalf.
CITY OF SAN CARLOS:
Dated:
Kathy Kleinbaum, City Manager
ATTEST:
Dated:
Crystal Mui, City Clerk
APPROVED AS TO FORM:
Dated:
Greg Rubens, City Attorney
CONSULTANT:
I acknowledge that I have full authority to execute this addendum on behalf of the Consultant, and have read, understand, and agree to comply with the provisions of this Addendum, including the Insurance and indemnity requirements set forth herein.
D a t e d :
James K. Stickley, Principal, WRT, LLC
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Addendum to Agreement 2 Revised: 05/07/2026
Exhibit A – Scope of Work
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Adopt a Resolution Accepting and Approving the Annual Investment Policy for Fiscal Year 2026-27.
RECOMMENDATION:
Staff recommend that the City Council complete the annual review of the City’s Investment Policy and adopt a Resolution accepting and approving the Investment Policy for fiscal year (FY) 2026-
27. FISCAL IMPLICATIONS:
There are no fiscal implications, and no additional funding is needed.
BACKGROUND:
California Government Code Section 53646(a)(2) requires annual review and approval of the Investment Policy by the City Council. The City’s Investment Policy was last adopted by the City Council on May 12, 2025, via Resolution 2025-034.
The Investment Policy applies to all financial assets of the City as accounted for in the Annual Comprehensive Financial Report (ACFR). Statements outlined in the Investment Policy focus on the City’s pooled funds but will also apply to all other funds under the Administrative Services Director’s span of control, unless specifically exempted by statute or ordinance. This policy is applicable, but not limited to, the following funds: General Fund; Sewer Fund; Capital Funds; Other Special Revenue Funds; Internal Service Funds; Trust and Agency Funds; City and County Association of Governments (C/CAG); and any new fund created by the City Council, unless specifically exempted.
The City’s investment portfolio has had an average quarter-end balance of approximately $179 million over the past two years. These funds are drawn on throughout the fiscal year for normal operating activity, with more significant levels of draw occurring in the 1st quarter of the fiscal year (July – September) and the 3rd quarter (January – March). The City’s cash position improves in late December and April due to the receipt of property tax collections from San Mateo County.
The City’s policy and selections have always been more conservative than permitted by state code, with idle cash invested primarily in the San Mateo County Investment Pool and the State’s Local Agency Investment Fund (LAIF). Although these investment pools do not earn high yields, they satisfy the primary objective of safety of principal and the secondary objective of liquidity.
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ANALYSIS:
The following changes to the policy are recommended to incorporate recent updates to the California Government Code (“Code”) that govern the investment of public funds. These changes, also shown in the red-lined version of the policy (Attachment 2) will update the policy to align with the California Debt and Investment Advisory Commission (CDIAC) Local Agency Investment Guidelines. The CDIAC reviews and makes changes to its Guidelines to incorporate changes in state law on an annual basis.
Updated Commercial paper. Chapter 242, Statutes of 2025 (SB 858) amends Gov. Code 53601(h) to increase the maximum maturity for prime quality commercial paper from 270 days to up to 397 days. Furthermore, Chapter 323, Statutes of 2025 (SB 595) amends Government Code (Gov. Code) section 53601(h) to address the investment of local agency surplus funds. The bill extends, until January 1, 2031, the authority for local agencies that have $100,000,000 or more of investment assets under management, to invest no more than 40% of their money in eligible commercial paper. Added acknowledgement under Legislative Changes. SB 595 amends Gov. Code section 53601.6 to extend a local agency’s authority to invest in securities issued by, or backed by, the United States government that could result in zero-interest accrual if held to maturity, to January 1, 2031.
Updated Ethics and Conflicts of Interest. Chapter 331, Statutes of 2025 (SB 852) amends Gov. Code 87500(a)(2) adding public officials who manage public investments to the list of individuals that are required to file statements of economic interest (Form 700) using the Fair Political Practice Commission’s electronic filing system. Updated Ethics and Conflicts of Interest. Chapter 661, Statutes of 2025 (SB 827) expands training requirements for local agency officials in California by updating ethics training mandates and introducing a new fiscal and financial training component. Ethics training must now be completed within six months of starting service (previously one year). Public agencies must also maintain and publicly disclose training records for at least five years, with instructions on how to request training records posted on their website beginning July 1, 2026. SB 827 establishes a biennial two-hour fiscal and financial training requirement for officials of cities, counties and special districts including members of the legislative body, elected officers, appointed officials with financial responsibilities and other agency executives. The training specified in the bill covers a wide variety of fiscal and financial topics including capital financing and debt management, pensions and other postemployment benefits, cash management and investments, the prudent investor standard, the ethics of safeguarding public resources, municipal budgets and budget processes, and financial reporting and auditing. Agencies may partner with recognized experts to deliver the training in person or online and must offer it annually. Updated Item 9 under Authorized Investments. Chapter 2.A of the 2026 Local Agency Investment Guidelines now includes a reference to shares of real estate investment trusts (REITs), exchange traded funds (EFTs), and equities, and annuities as prohibited investments.
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Since the City only invests in LAIF and County Pool, changes to holding restrictions of other investment types in the Code, such as those listed above, have no impact on the City.
The City’s Investment Committee, consisting of Kathy Kleinbaum, City Manager; Inge Tiegel, City Treasurer; and Rebecca Mendenhall, Administrative Services Director, has reviewed and approved the recommended revisions to the policy.
ALTERNATIVES:
The alternatives available to the City Council include:
1. Adopt a Resolution accepting and approving the Annual Investment Policy FY 2026-27; or
2. Do not adopt the Resolution; or
3. Provide staff with alternative direction.
Respectfully submitted by:
Rebecca Mendenhall, Administrative Services Director
Approved for submission by:
___________________________________
Kathy Kleinbaum, City Manager
ATTACHMENT(S):
1. Resolution
2. Proposed FY2026-27 Investment Policy (Red-Lined)
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RESOLUTION NO. 2026 – ____
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS
ACCEPTING AND APPROVING THE ANNUAL INVESTMENT POLICY
FOR FISCAL YEAR 2026-27.
WHEREAS, California Code Section 53646(a)(2) requires annual review and approval of the Investment Policy by the City Council; and
WHEREAS, the City’s Investment Policy was last adopted by the City Council on May 12, 2025 via Resolution 2025-034; and
WHEREAS, staff recommends the following changes to the Investment Policy to align with the California Debt and Investment Advisory Commission’s (CDIAC) Local Agency Investment Guidelines:
(1) Increased the maximum maturity for prime quality commercial paper from 270 days to up to 397 days until January 31, 2031.
(2) Acknowledged extension of a local agency’s authority to invest in securities issued by, or backed by, the United States government that could result in zero-interest accrual if held to maturity, to January 1, 2031.
(3) Added public officials who manage public investments to the list of individuals that are required to file statements of economic interest (Form 700) using the Fair Political Practice Commission’s electronic filing system.
(4) Expanded training requirements for local agency officials in California by updating ethics training mandates and introducing a new fiscal and financial training component. Ethics training must now be completed within six months of starting service (previously one year). Public agencies must also maintain and publicly disclose training records for at least five years, with instructions on how to request training records posted on their website beginning July 1, 2026.
SB 827 establishes a biennial two-hour fiscal and financial training requirement for officials of cities, counties and special districts including members of the legislative body, elected officers, appointed officials with financial responsibilities and other agency executives. The training specified in the bill covers a wide variety of fiscal and financial topics including capital financing and debt management, pensions and other postemployment benefits, cash management and investments, the prudent investor standard, the ethics of safeguarding public resources, municipal budgets and budget processes, and financial reporting and auditing. Agencies may partner with recognized experts to deliver the training in person or online and must offer it annually. (5) Added real estate investment trusts (REITs), exchange traded funds (EFTs), and equities, and annuities as prohibited investments.
NOW, THEREFORE BE IT RESOLVED, by the City Council of the City of San Carlos that the Fiscal Year 2026-27 Investment Policy is hereby approved and adopted with the changes mentioned above.
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* * * * *
I, City Clerk Crystal Mui, hereby certify that the foregoing Resolution was duly and regularly passed and adopted by the City Council of the City of San Carlos at a scheduled meeting thereof held on the 26th day of May 2026, by the following vote:
________________________________
CITY CLERK of the City of San Carlos
APPROVED:
___________________________
MAYOR of the City of San Carlos
AYES, COUNCILMEMBERS:
NOES, COUNCILMEMBERS:
ABSENT, COUNCILMEMBERS:
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CITY OF SAN CARLOS
INVESTMENT POLICY
Last Adopted by Council: May XX, 2026
Resolution No. 2026-XXX
POLICY
In accordance with the Municipal Code of the City of San Carlos and under authority granted by the City Council, the City Administrative Services Director is responsible for investing the unexpended cash in the City Treasury.
The investment of the funds of the City of San Carlos is directed to the goals of safety, liquidity and yield. The authority governing investments for municipal governments is set forth in the California Government Code, Sections 53600 through 53686.
The primary objective of the investment policy of the City of San Carlos is Safety of Principal.
Investments shall be placed in those securities as outlined by type and maturity sector in this document. Effective cash flow management and resulting cash investment practices are recognized as essential to good fiscal management and control. The City's portfolio shall be designed and managed in a manner responsive to the public trust and consistent with state and local law. Portfolio management requires continual analysis and as a result the balance between the various investments and maturities may change in order to give the City of San Carlos the optimum combination of necessary liquidity and optimal yield based on cash flow projections.
SCOPE
The investment policy applies to all financial assets of the City of San Carlos as accounted for in the Annual Comprehensive Financial Report (ACFR). Policy statements outlined in this document focus on the City of San Carlos' pooled funds, but will also apply to all other funds under the City Administrative Services Director's span of control unless specifically exempted by statue or ordinance. This policy is applicable, but not limited to all funds listed below:
General Fund; Sewer Fund; Capital Funds; Other Special Revenue Funds; Debt Service Funds; Internal Service Funds; Trust and Custodial Funds; Peninsula Traffic Congestion Relief Alliance (Commute.org) City and County Association of Governments of San Mateo County (C/CAG); Any new fund created by the City Council unless specifically exempted.
PRUDENCE
The standard to be used by investment officials shall be that of a "prudent investor" and shall be applied in the context of managing all aspects of the overall portfolio. When investing, reinvesting, purchasing, acquiring, exchanging, selling, or managing public funds, a trustee shall act with care, skill, prudence, and diligence under the circumstances then prevailing, including, but not limited to, the general economic conditions and the anticipated needs of the agency, that a prudent person acting in a like capacity and familiarity with those matters would use in the conduct of funds of a like character and with like aims, to safeguard the principal and maintain the liquidity needs of the
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City of San Carlos
Investment Policy Page 2
agency. Within the limitations of this section and considering individual investments as part of an overall strategy, investments may be acquired as authorized by law.
It is the City's full intent, at the time of purchase, to hold all investments until maturity to ensure the return of all invested principal dollars. However, it is realized that market prices of securities will vary depending on economic and interest rate conditions at any point in time. It is further recognized that in a well-diversified investment portfolio, occasional measured losses are inevitable due to economic, bond market or individual security credit analysis. These occasional losses must be considered within the context of the overall investment program objectives and the resultant long- term rate of return.
The City Administrative Services Director and other individuals assigned to manage the investment portfolio, acting within the intent and scope of the investment policy and other written procedures and exercising due diligence, shall be relieved of personal responsibility and liability for an individual security's credit risk or market price changes, provided deviations from expectations are reported in a timely manner and appropriate action is taken to control adverse developments.
OBJECTIVES
Safety of Principal
Safety of Principal is the foremost objective of the City of San Carlos. Each investment transaction shall seek to ensure that capital losses are avoided, whether from securities default, broker-dealer default or erosion of market value. The City shall seek to preserve principal by mitigating the two types of risk: credit risk and market risk.
Credit risk, defined as the risk of loss due to failure of the issuer of a security, shall be mitigated by investing in investment grade securities and by diversifying the investment portfolio so that the failure of any one issuer does not unduly harm the City's capital base and cash flow.
Market risk, defined as market value fluctuations due to overall changes in the general level of interest rates, shall be mitigated by limiting the average maturity of the City's investment portfolio to two years, the maximum maturity of any one security to five years, structuring the portfolio based on historic and current cash flow analysis eliminating the need to sell securities prior to maturity and avoiding the purchase of long term securities for the sole purpose of short term speculation.
Liquidity
Historical cash flow trends are compared to current cash flow requirements on an ongoing basis in an effort to ensure that the City's investment portfolio will remain sufficiently liquid to enable the City to meet all reasonably anticipated operating requirements.
Maturity Matrix
Maturities of investments will be selected based on liquidity requirements to minimize interest rate risk and maximize earnings. Current and expected yield curve analysis will be monitored and the portfolio will be invested accordingly. The weighted average maturity of the pooled portfolio should not exceed two years and the following percentages of the portfolio should be invested in the following maturity sectors:
Maturity Range Suggested Percentage
1 day to 7 days 10 to 50%
7 days to 180 10 to 30%
180 days to 360 days 10 to 30%
1 year to 2 years 10 to 20%
2 years to 3 years 0 to 20%
3 years to 4 years 0 to 20%
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4 years to 5 years 0 to 20%
Over 5 years Council Authorization Required *
* One exception does exist regarding the investment of bond reserve funds. If in the opinion of the City Administrative Services Director, matching the segregated investment portfolio of the bond reserve fund with the maturity schedule of an individual bond issue is prudent given current economic analysis, the investment policy authorizes extending beyond the five-year maturity limitation as outlined in this document.
PERFORMANCE EVALUATION
Investment performance is monitored and evaluated by the City Investment Advisory Committee.
Investment performance statistics and activity reports are generated on a quarterly basis for presentation to the City Investment Advisory Committee and to the City Council. Annually, a statement of investment policy, and any proposed changes to the policy, will be rendered to the Investment Advisory Committee and then to the City Council for consideration at a public meeting.
The City’s investment portfolio is designed to at least attain a market average rate of return through economic cycles. The market average rate of return is defined as average return on the Local Agency Investment Fund (assuming the State does not adversely affect LAIF’s returns due to budget constraints).
DELEGATION OF AUTHORITY
The Municipal Code of the City of San Carlos and the authority granted by City Council assign the responsibility of investing unexpended cash to the City’s Administrative Services Director. Daily management responsibility of the investment program may be delegated to the Financial Services Manager, who shall establish procedures for the operation consistent with this investment policy.
INVESTMENT COMMITTEE
An investment committee consisting of the City Treasurer, City Manager, and Administrative Services Director shall be established to provide general oversight and direction concerning the policy related to management of the City's investment pool. The Financial Services Manager shall not be a member of the committee but shall serve in a staff and advisory capacity. The committee shall review and approve quarterly investment reports prepared by the Finance Department and reviewed by the Financial Services Manager or meet as necessary to discuss changes to the report or the investment strategy. The Investment Committee serving as the legislative body of the Investment Policy will have the quarterly reports for review within forty-five (45) days following the end of the quarter covered by the report as per Section 53646 (b)(1) of the California Government Code.
ETHICS AND CONFLICTS OF INTEREST
Officers and employees involved in the investment process shall refrain from personal business activity that conflicts with proper execution of the investment program, or impairs their ability to make impartial investment decisions. Additionally, the Administrative Services Director an,d the Financial Services Manager and all other public officials who manage the public investments are required to annually file applicable financial disclosures as required by the Fair Political Practices Commission (FPPC).
Ethics Training Requirements:
In compliance with state law, officials must complete legally mandated ethics training within six (6) months of assuming office, and every two years thereafter. This training is intended to ensure that officials understand their responsibilities related to transparency, conflicts of interest, use of public resources, and other core public ethics principles.
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Fiscal and Financial Training Requirements:
Officials of the City who have financial management, investment oversight, budgetary, or fiduciary responsibilities shall complete at least two (2) hours of fiscal and financial training every two years, as required under state law. This training shall cover, at minimum, capital financing and debt management, pensions and other post‑employment benefits, cash management and investments, the prudent investor standard, safeguarding public resources, municipal budgeting, and financial reporting and auditing. The City may partner with recognized subject‑matter experts to deliver this training in person or online, and shall ensure that it is offered on at least an annual basis.
Training Records and Public Disclosure:
The City shall maintain records of all required ethics and fiscal/financial training completed by officials for no fewer than five (5) years. Beginning July 1, 2026, the City shall also post clear instructions on its website describing how members of the public may request copies of these records, consistent with the public transparency provisions of state law.
SAFEKEEPING OF SECURITIES
To protect against fraud or embezzlement or losses caused by collapse of an individual securities dealer, all securities owned by the City shall be held in safekeeping by a third- party bank trust department, acting as agent for the City under the terms of a custody agreement. All trades executed by a dealer will settle delivery versus payment (DVP) through the City's safekeeping agent.
Securities held custody for the City shall be monitored by the Administrative Services Director to verify investment holdings.
All exceptions to this safekeeping policy must be approved by the City’s Administrative Services Director in written form and included in the quarterly reports to the Investment Committee and the City Council.
INTERNAL CONTROL
Separation of functions between the City’s Administrative Services Director or Financial Services Manager and/or the City Senior Accountant is designed to provide an ongoing internal review to prevent the potential for converting assets or concealing transactions.
Investment decisions are made by the Administrative Services Director, executed by the Administrative Services Director or Financial Services Manager and confirmed by the Senior Accountant. All wire transfers initiated by the Administrative Services Director or Financial Services Manager must be reconfirmed by the appropriate financial institution to the Senior Accountant.
Proper documentation obtained from confirmation and cash disbursement wire transfers is required for each investment transaction. Timely bank reconciliation is conducted to ensure proper handling of all transactions.
The investment portfolio and all related transactions are reviewed and balanced to appropriate general ledger accounts by the Senior Accountant on a monthly basis. An independent analysis by an external auditor shall be conducted annually to review and perform procedure testing on the City’s cash and investments that have a material impact on the financial statements. The Administrative Services Director and/or Investment Committee shall review and assure compliance with investment processes and procedures.
REPORTING
The City Administrative Services Director shall review and render quarterly reports to the City Investment Advisory Committee and to the City Council that include the face amount of the cash investment, the classification of the investment, the name of the institution or entity, the rate of
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interest, the maturity date, the current market value and accrued interest due for all securities. The quarterly reports will be submitted to the Investment Committee within forty-five (45) days following the end of the quarter covered by the report as per Section 53646 (b)(1) of the California Government Code. Once approved by the Investment Committee, the quarterly reports shall be placed on the City Council’s meeting agenda for its review and approval no later than 60 days after the quarter ends. If there are no Council meetings within the 60-day period, the quarterly report shall be presented to the Council at the soonest possible meeting thereafter.
QUALIFIED BROKER/DEALERS
The City shall transact business only with banks, savings and loans, and with broker/dealers. The broker/dealers should be primary or regional dealers. The City’s Administrative Services Director will make exceptions only upon written authorization. The City currently does not maintain a list of broker/dealers approved to do business with the City. When necessary, the City shall go through the Request for Proposal processes to select the broker/dealers. Staff shall investigate dealers wishing to do business with the City to determine if they are adequately capitalized, have pending legal action against the firm or the individual broker and make markets in the securities appropriate to the City's needs. The City’s investment policy shall be made available on the City’s website for broker/dealers’ review.
COLLATERAL REQUIREMENTS
Collateral is required for investments in certificates of deposit. To reduce market risk, the collateral level will be at least 110% of market value of principal and accrued interest.
AUTHORIZED INVESTMENTS
Investment of City funds is governed by the California Government Code Sections 53600 et seq.
Within the context of the limitations, the following investments are authorized, as further limited herein:
1. United States Treasury Bills, Bonds, and Notes or those for which the full faith and credit of the United States are pledged for payment of principal and interest. There is no percentage limitation of the portfolio that can be invested in this category, although a five-year maturity limitation is applicable.
2. Local Agency Investment Fund (LAIF), which is a State of California managed investment pool, and San Mateo County Investment pool, may be used up to the maximum permitted by California State Law. A review of the pool/fund is required when part of the list of authorized investments, with the knowledge that the pool/fund may include some investments allowed by statute but not explicitly identified in this investment policy.
3. Most mortgage-backed securities are obligations issued by the Government National Mortgage Association (GNMA), the Federal National Mortgage Association (FNMA), and the Federal Home Loan Mortgage Corporation (FHLMC). A mortgage passthrough security, collateralized mortgage obligation, mortgage-backed or other pay-through bond, equipment lease-backed certificate, consumer receivable passthrough certificate, or consumer receivable-backed bond. Securities eligible for investment under this subdivision and not issued or guaranteed by an agency or issuer identified in California Government Code Section 53601 subdivision (b) or (f) subdivision, shall be rated in a rating category of “AA” or its equivalent or better by a nationally recognized statistical rating organization (NRSRO) and have a maximum remaining maturity of five years or less. Purchase of securities authorized by this subdivision shall not exceed 20% of the agency’s surplus moneys that may be invested pursuant to this section.
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4. Bills of exchange or time drafts drawn on and accepted by commercial banks, otherwise known as bankers’ acceptances. Bankers’ acceptances purchased may not exceed 180 days to maturity or 40% of the cost value of the portfolio. Also, no more than 30% of the agency’s money may be in bankers’ acceptances of any one commercial bank.
5. Commercial paper ranked the highest letter and number rating by a nationally recognized statistical rating organization (NRSRO), such as Standard and Poor’s Ratings Services, Fitch Ratings, Inc. or Moody’s Investors Services, and issued by domestic corporations having assets in excess of $500,000,000 and having an “A” or better rating on its long-term debentures as provided by NRSRO. Purchases of eligible commercial paper may not exceed 397270 days to maturity and may not exceed 4025% of the value of the portfolio until January 31, 2031, and 25% thereafter. The amount invested in any one issuer shall not exceed 10% of the portfolio.
6. Negotiable Certificates of Deposit issued by nationally or state- chartered banks (FDIC insured institutions) or state or federal savings institutions. Purchases of negotiable certificates of deposit may not exceed 30% of total portfolio. A maturity limitation of five years is applicable.
7. Time deposits or placement service deposits, non-negotiable and collateralized in accordance with the California Government Code, may be purchased through banks or savings and loan associations. Since time deposits are not liquid, no more than 50% of the investment portfolio may be invested in this investment type. A maturity limitation of five years is applicable. Effective January 1, 2020, no more than 50 percent of the agency’s money may be invested in deposits, including certificates of deposit, through a placement service as authorized under 53601.8 (excludes negotiable certificates of deposit authorized under Section 53601(i)). On January 1, 2031, the maximum percentage of the portfolio reverts back to 30 percent. Investments made pursuant to 53635.8 remain subject to a maximum of 30% of the portfolio.
8. Medium Term Corporate Notes, with a maximum maturity of five years, may be purchased.
Securities eligible for investment shall be rated “A” or better by an NRSRO. Purchase of medium term notes may not exceed 30% of the market value of the portfolio.
9. Ineligible investments are those that are not described herein, including but not limited to, common stocks, and long term (over five years in maturity) notes and bonds, and insurance products like annuities. , and Other investments commonly held in personal investment portfolios such as real estate investment trusts (REITs), exchange traded funds (EFTs), and equities are prohibited investmentsfrom use in this portfolio. It is noted that special circumstances may arise that necessitate the purchase of securities beyond the five-year limitation. On such occasions, requests must be approved by City Council prior to purchase.
10. Various daily money market funds administered for or by trustees, paying agents and custodian banks contracted by the City of San Carlos may be purchased as allowed under the State of California Government Code. Only funds holding U.S. Treasury or Government agency obligations can be used.
The following summary of maximum percentage limits, by instrument, are established for the City's total pooled funds portfolio:
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Authorized Investment
Type
Government
Code
Maximum
Maturity
Minimum
Credit
Quality
Maximum in
Portfolio
Maximum
Investment in
One Issuer
Local Agency
Investment Fund
(LAIF)
16429.1 Upon
Demand N/A
As permitted by
LAIF (currently $75
million per account)
N/A
San Mateo County
Investment Pool 53684 Upon
Demand N/A
As permitted by
County Treasurer
(currently no limit)
N/A
Treasury Obligations
(bills, notes & bonds) 53601(b) 5 Years N/A 100% N/A
US Government
Agency and Federal
Agency Securities
53601(f) 5 Years N/A 100% N/A
Mortgage Pass-
Through Securities or
Mortgage-Backed
Securities
53601(o) 5 years (C) 20% N/A
Bankers’ Acceptances 53601(g) 180 Days N/A 40% (B)
Commercial Paper 53601(h) 397270
Days
Highest
letter and
number
rating by
an
NRSRO
4025% (A)
Negotiable Certificates
of Deposit 53601(i) 5 Years N/A 30% N/A
Placement Service
Deposits – Deposits or
Certificates of
Deposits
53601.8 and
53635.8 5 Years N/A 50% N/A
Medium Term
Corporate Notes 53601(k) 5 Years A 30% N/A
(A) 10% of outstanding paper of issuing corporation
(B) No more than 30% of the agency’s money may be in bankers’ acceptances of any one commercial bank.
(C) Securities eligible for investment under this subdivision shall be rated in a rating category of “AA” or its equivalent or better by an NRSRO.
DERIVATIVE INVESTMENTS
Derivatives are investments whose value is "derived" from a benchmark or index. That benchmark can be almost any financial measure from interest rates to commodity and stock prices. The use of derivatives is prohibited under this policy.
LEGISLATIVE CHANGES
Any State of California legislative action that further restricts allowable maturities, investment type, or percentage allocations will be incorporated into the City of San Carlos' Investment Policy and supersede any and all previous applicable language.
Effective January 1, 2026, the City acknowledges the extension of Government Code § 53601.6 authorizing investment in U.S. government‑issued or government‑backed securities that may result in zero‑interest accrual if held to maturity, through January 1, 2031.
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INTEREST EARNINGS
All monieeys earned and collected from investments authorized in this policy shall be allocated quarterly to various fund accounts based on the cash balance in each fund at quarter end as a percentage of the entire pooled portfolio.
LIMITING MARKET VALUE EROSION
The longer the maturity of securities, the greater their market price volatility. Therefore, it is the general policy of the City to limit the potential effects from erosion in market values by adhering to the following guidelines:
All immediate and anticipated liquidity requirements will be addressed prior to purchasing all investments.
Maturity dates for long-term investments will coincide with significant cash flow requirements where possible, to assist with short- term cash requirements at maturity.
All long-term securities will be purchased with the intent to hold all investments to maturity under then prevailing economic conditions. However, economic or market conditions may change, making it in the City's best interest to sell or trade a security prior to maturity.
PORTFOLIO MANAGEMENT ACTIVITY
The investment program shall seek to augment returns consistent with the intent of this policy, identified risk limitations and prudent investment principals. These objectives will be achieved by use of the following strategies:
Active Portfolio Management. Through active fund and cash flow management, taking advantage of current economic and interest rate trends, the portfolio yield may be enhanced with limited and measurable increases in risk by extending the weighted maturity of the total portfolio.
Portfolio Maturity Management. When structuring the maturity composition of the portfolio, the City shall evaluate current and expected interest rate yields and necessary cash flow requirements. It is recognized that in normal market conditions longer maturities produce higher yields. However, the securities with longer maturities also experience greater price fluctuations when the level of interest rates change.
Security Swaps. The City may take advantage of security swap opportunities to improve the overall portfolio yield. A swap, which improves the portfolio yield, may be selected even if the transactions result in an accounting loss. Documentation for swaps will be included in the City's permanent investment file documents.
Competitive Bidding. It is the policy of the City to require competitive bidding for investment transactions that are not classified as "new issue" securities. For the purchase of non-"new issue" securities and the sale of all securities at least three bidders must be contacted. Competitive bidding for security swaps is also suggested, however, it is understood that certain time constraints and broker portfolio limitations exist that would not accommodate the competitive bidding process. If a time or portfolio constraining condition exists, the pricing of the swap should be verified to current market conditions and documented for auditing purposes.
POLICY REVIEW
The City of San Carlos' investment policy shall be adopted by resolution of the City Council on an annual basis. This investment policy shall be reviewed at least annually to ensure its consistency with the overall objectives of preservation of principal, liquidity and yield, and its relevance to current
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law and financial and economic trends. Any amendments to the policy shall be forwarded to City Council for approval.
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Glossary of Terms
Accrued Interest: Interest earned but not yet received.
Active Deposits: Funds that are immediately required for disbursement.
Amortization: An accounting practice of gradually decreasing (increasing) an asset's book value by spreading its depreciation (accretion) over a period of time.
Annual Comprehensive Financial Report (ACFR): The official annual financial report for the City. It includes government-wide statements and basic financial statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP).
Asked Price: The price a broker dealer offers to sell securities.
Basis Point: One basis point is one hundredth of one percent (.01).
Bid Price: The price a broker / dealer offers to purchase securities.
Bond: A financial obligation for which the issuer promises to pay the bondholder a specified stream of future cash flows, including periodic interest payments and a principal repayment.
Bond Swap: Selling one bond issue and buying another at the same time in order to create an advantage for the investor. Some benefits of swapping may include tax-deductible losses, increased yields, and an improved quality portfolio.
Book Entry Securities: Securities, such stocks held in “street name,” that are recorded in a customer’s account, but are not accompanied by a certificate. The trend is toward a certificate-free society to cut down on paperwork and to diminish investors’ concerns about the certificates themselves. All the large New York City banks, including those that handle the bulk of the transactions of the major government securities dealers, now clear most of their transactions with each other and with the Federal Reserve through the use of automated telecommunications and the “book-entry” custody system maintained by the Federal Reserve Bank of New York. These banks have deposited with the Federal Reserve Bank a major portion of their government and agency securities holdings, including securities held for the accounts of their customers or in a fiduciary capacity. Virtually all transfers for the account of the banks, as well as for the government securities dealers who are their clients, are now effected solely by bookkeeping entries. The system reduces the costs and risks of physical handling and speeds the completion of transactions.
Bearer and Registered Bonds: In the past, bearer and registered bonds were issued in paper form.
Those still outstanding may be exchanged at any Federal Reserve Bank or branch for an equal amount of any authorized denomination of the same issue. Outstanding bearer bonds are interchangeable with registered bonds and bonds in “book-entry” form. That is, the latter exist as computer entries only and no paper securities are issued. New bearer and registered bonds are no longer being issued. Since August 1986, the Treasury’s new issues of marketable notes and bonds are available in book-entry form only. All Treasury bills and more than 90% of all other marketable securities are now in book-entry form. Book-entry obligations are transferable only pursuant to regulations prescribed by the Secretary of the Treasury.
Book Value: The value at which a debt security is shown on the holder's balance sheet. Book value is acquisition cost less amortization of premium or accretion of discount.
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Broker: In securities, the intermediary between a buyer and a seller of securities. The broker, who usually charges a commission, must be registered with the exchange in which he or she is trading, accounting for the name registered representative.
Certificate of Deposit: A deposit insured up to $250,000 by the Federal Deposit Insurance Corporation (FDIC) at a set rate for a specified period of time.
Collateral: Securities, evidence of deposit or pledges to secure repayment of a loan. Also refers to securities pledged by a bank to secure deposit of public moneieys.
Comprehensive Annual Financial Report (CAFR): The official annual financial report for the City. It includes five combined statements and basic financial statements for each individual fund and account group prepared in conformity with Generally Accepted Accounting Principles (GAAP).
Constant Maturity Treasury (CMT): An average yield of a specific Treasury maturity sector for a specific time frame. This is a market index for reference of past direction of interest rates for the given Treasury maturity range.
Coupon: The annual rate of interest that a bond's issuer promises to pay the bondholder on the bond's face value.
Credit Analysis: A critical review and appraisal of the economic and financial conditions or of the ability to meet debt obligations.
Current Yield: The interest paid on an investment expressed as a percentage of the current price of the security.
Custody: A banking service that provides safekeeping for the individual securities in a customer's investment portfolio under a written agreement that also calls for the bank to collect and pay out income, to buy, sell, receive and deliver securities when ordered to do so by the principal.
Delivery vs. Payment (DVP): Delivery of securities with a simultaneous exchange of money for the securities.
Discount: The difference between the cost of a security and its value at maturity when quoted at lower than face value.
Diversification: Dividing investment funds among a variety of securities offering independent returns and risk profiles.
Duration: The weighted average maturity of a bond's cash flow stream, where the present value of the cash flows serve as the weights; the future point in time at which on average, an investor has received exactly half of the original investment, in present value terms; a bond's zero-coupon equivalent; the fulcrum of a bond's present value cash flow time line.
Fannie Mae: Trade name for the Federal National Mortgage Association (FNMA), a U.S. sponsored corporation.
Federal Reserve System: The central bank of the U.S. that consists of a seven- member Board of Governors, 12 regional banks and approximately 8,000 commercial banks that are members.
Federal Deposit Insurance Corporation (FDIC): Insurance provided to customers of a subscribing bank that guarantees deposits to a set limit (currently $250,000) per account.
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Fed Wire: A wire transmission service established by the Federal Reserve Bank to facilitate the transfer of funds through debits and credits of funds between participants within the Fed system.
Freddie Mac: Trade name for the Federal Home Loan Mortgage Corporation (FHLMC), a U.S. sponsored corporation.
Ginnie Mae: Trade name for the Government National Mortgage Association (GNMA), a direct obligation bearing the full faith and credit of the U.S. Government.
Inactive Deposits: Funds not immediately needed for disbursement.
Interest Rate: The annual yield earned on an investment, expressed as a percentage.
Investment Agreements: An agreement with a financial institution to borrow public funds subject to certain negotiated terms and conditions concerning collateral, liquidity and interest rates.
Liquidity: Refers to the ability to rapidly convert an investment into cash.
Market Value: The price at which a security is trading and could presumably be purchased or sold.
Maturity: The date upon which the principal or stated value of an investment becomes due and payable.
Nationally Recognized Statistical Rating Organizations (NRSRO): A U.S. Securities & Exchange Commission registered agency that assesses the creditworthiness of an entity or specific security.
NRSRO typically refers to Standard and Poor’s Ratings Services, Fitch Ratings, Inc. or Moody’s Investors Services.
New Issue: Term used when a security is originally "brought" to market.
Perfected Delivery: Refers to an investment where the actual security or collateral is held by an independent third party representing the purchasing entity.
Portfolio: Collection of securities held by an investor.
Primary Dealer: A group of government securities dealers that submit daily reports of market activity and security positions held to the Federal Reserve Bank of New York and are subject to its informal oversight.
Purchase Date: The date in which a security is purchased for settlement on that or a later date.
Rate of Return: The yield obtainable on a security based on its purchase price or its current market price. This may be the amortized yield to maturity on a bond or the current income return.
Repurchase Agreement (REPO): A transaction where the seller (bank) agrees to buy back from the buyer (City) the securities at an agreed upon price after a stated period of time.
Reverse Repurchase Agreement (REVERSE REPO): A transaction where the seller (City) agrees to buy back from the buyer (bank) the securities at an agreed upon price after a stated period of time.
Risk: Degree of uncertainty of return on an asset.
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Safekeeping: See Custody.
Sallie Mae: Trade name for the Student Loan Marketing Association (SLMA), a U.S. sponsored corporation.
Secondary Market: A market made for the purchase and sale of outstanding issues following the initial distribution.
Settlement Date: The date on which a trade is cleared by delivery of securities against funds.
Time Deposit: A deposit in an interest-paying account that requires the money to remain on account for a specific length of time. While withdrawals can generally be made from a passbook account at any time, other time deposits, such as certificates of deposit, are penalized for early withdrawal.
Treasury Obligations: Debt obligations of the U.S. Government that are sold by the Treasury Department in the forms of bills, notes, and bonds. Bills are short-term obligations that mature in one year or less. Notes are obligations that mature between one year and ten years. Bonds are long-term obligations that generally mature in ten years or more.
U.S. Government Agencies: Instruments issued by various US Government Agencies most of which are secured only by the credit worthiness of the particular agency.
Yield: The rate of annual income return on an investment, expressed as a percentage. It is obtained by dividing the current dollar income by the current market price of the security.
Yield to Maturity: The rate of income return on an investment, minus any premium or plus any discount, with the adjustment spread over the period from the date of purchase to the date of maturity of the bond, expressed as a percentage.
Yield Curve: The yield on bonds, notes or bills of the same type and credit risk at a specific date for maturities up to thirty years.
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Deny Claim of Licia Colaizzi.
RECOMMENDATION:
Staff recommend that the City Council deny the claim of Licia Colaizzi as recommended by the City’s claim administrators at Carl Warren.
FISCAL IMPLICATIONS:
There are no fiscal implications, and no additional funding is needed.
BACKGROUND:
This item is coming before the Council to act on the claim submitted by Licia Colaizzi (“Claimant”).
Staff recommend that the City Council deny the claim based on Carl Warren’s guidance.
The Tort Claims Act. California Government Code Sections 900, seq., mandates that all claims for money or damages against a public entity must be presented in writing to the public entity prior to filing suit. Generally, claims concerning personal injury, wrongful death, damage to personal property, or damage to crops must be presented to the public within six (6) months of the accrual of the claim. All other claims, principally claims on contracts and damage to real property, are subject to a one-year statute of limitations for presentation of the tort claim. Once a tort claim is received by the public entity, the entity has forty-five (45) days to act on the claim. A claim can be settled or rejected. If no action is taken within 45 days, the claim is deemed rejected by operation of law on the last day.
Claim Processing in San Carlos. When the City receives a claim, it is immediately forwarded to claims examiners at Carl Warren for investigation. Upon completing the investigation, Carl Warren provides the City with a recommendation on how to proceed with the claim.
About Carl Warren. Carl Warren is a leading national third-party administrator (TPA) that specializes in property and casualty claims management, subrogation recovery, and litigation management. Effective January 1, 2025, Carl Warren was hired by Pooled Liability Assistance Network Joint Powers Authority (PLAN JPA) to provide claims administration services to member cities. The City Council approved the City’s participation in the PLAN JPA (previously known as the Association of Bay Area Government Pooled Liability Assurance Network (ABAG PLAN) on November 27, 2017, and designated the Administrative Services Director and Senior Management Analyst as primary and alternate PLAN JPA Board members.
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ANALYSIS:
Claimant filed a claim against the City for property damages. Claimant alleges that on January 24, 2026, Claimant experienced a sewer backup incident at her house where sewer waste backed up into the lower-floor shower drain. Claimant called a plumber who cleared out the blockage.
Claimant contacted the City on January 27, 2026, three days after the incident, by submitting an Inform San Carlos request. Municipal Code Chapter 13.05 requires residents to report sewer issues to the City when they are first discovered. Public Works staff responded and went out to investigate the incident but did not find any backup upon arrival. They did, however, find the line open and flowing, although roots were found at the main tap. Staff jetted the main line to remove the roots, after which the line remained open and flowing.
Although the location has since been placed on a 90-day maintenance schedule, the City is not liable as there was no prior notice or history of sewer issues at this property. In addition, the resident did not follow the proper protocol per the San Carlos Municipal Code. For these reasons, Carl Warren recommends formal rejection of Licia Colaizzi’s claim.
The Council’s rejection of this claim does not prevent City staff nor the staff of Carl Warren from continuing to work with the Claimant to resolve the dispute.
ALTERNATIVES:
The alternatives available to the City Council include:
1. Deny claim of Licia Colaizzi; or
2. Do not deny claim of Licia Colaizzi; or
3. Provide staff with alternative direction.
Respectfully submitted by:
Rebecca Mendenhall, Administrative Services Director
Approved for submission by:
__________________________________
Kathy Kleinbaum, City Manager
ATTACHMENT(S):
1. Colaizzi, L. Claim Form
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Deny Claim of Paulette Dolin.
RECOMMENDATION:
Staff recommend that the City Council deny the claim of Paulette Dolin as recommended by the City’s claim administrators at Carl Warren.
FISCAL IMPLICATIONS:
There are no fiscal implications, and no additional funding is needed.
BACKGROUND:
This item is coming before the Council to act on the claim submitted by Paulette Dolin (“Claimant”).
Staff recommend that the City Council deny the claim based on Carl Warren’s guidance.
The Tort Claims Act. California Government Code Sections 900, seq., mandates that all claims for money or damages against a public entity must be presented in writing to the public entity prior to filing suit. Generally, claims concerning personal injury, wrongful death, damage to personal property, or damage to crops must be presented to the public within six (6) months of the accrual of the claim. All other claims, principally claims on contracts and damage to real property, are subject to a one-year statute of limitations for presentation of the tort claim. Once a tort claim is received by the public entity, the entity has forty-five (45) days to act on the claim. A claim can be settled or rejected. If no action is taken within 45 days, the claim is deemed rejected by operation of law on the last day.
Claim Processing in San Carlos. When the City receives a claim, it is immediately forwarded to claims examiners at Carl Warren for investigation. Upon completing the investigation, Carl Warren provides the City with a recommendation on how to proceed with the claim.
About Carl Warren. Carl Warren is a leading national third-party administrator (TPA) that specializes in property and casualty claims management, subrogation recovery, and litigation management. Effective January 1, 2025, Carl Warren was hired by Pooled Liability Assistance Network Joint Powers Authority (PLAN JPA) to provide claims administration services to member cities. The City Council approved the City’s participation in the PLAN JPA (previously known as the Association of Bay Area Government Pooled Liability Assurance Network (ABAG PLAN) on November 27, 2017, and designated the Administrative Services Director and Senior Management Analyst as primary and alternate PLAN JPA Board member.
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ANALYSIS:
Claimant filed a claim against the City seeking reimbursement for towing services. Claimant alleges that on March 16, 2026, while parking on Industrial Road, the vehicle’s tires became lodged in a broken tree grate. The claimant was unable to remove the vehicle from the grate and called for towing assistance, incurring a $54 towing fee, which is now being requested for reimbursement.
Staff investigated the incident and found no prior notice or complaints regarding the condition of the tree grate at the location. Tree grates are not designed or rated for vehicle traffic, and the claimant would have had to drive onto the metal grate for the incident to occur. Additionally, the grates at the site were elevated, suggesting the vehicle was driven onto a raised grate - an action that is not considered reasonable or expected. For these reasons, Carl Warren has recommended that the City formally reject Paulette Dolin’s claim. In addition, staff intend to pursue subrogation for the damage caused to City’s property as a result of the incident.
The Council’s rejection of this claim does not prevent City staff or the staff of Carl Warren from continuing to work with the Claimant to resolve the dispute.
ALTERNATIVES:
The alternatives available to the City Council include:
1. Deny claim of Paulette Dolin; or
2. Do not deny claim of Paulette Dolin; or
3. Provide staff with alternative direction.
Respectfully submitted by:
Rebecca Mendenhall, Administrative Services Director
Approved for submission by:
_____________________________________
Kathy Kleinbaum, City Manager
ATTACHMENT(S):
1. Dolin, P. Claim Form
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Consideration of Appointing Four Youth Advisory Council (YAC) Voting Members for the 2026 - 2028 Term, Two YAC Voting Members for the 2026 - 2027 Term, Two Alternate YAC Members for the 2026 - 2027 Term, and Recognizing Four Retiring YAC Voting Members.
RECOMMENDATION:
Staff recommend that the City Council appoint four Youth Advisory Council (YAC) voting members for the 2026-28 term, two YAC voting members for the 2026-27 term, two alternate YAC members for the 2026-27 term, and recognize four retiring YAC voting members.
FISCAL IMPLICATIONS:
There are no fiscal implications, and no additional funding is needed.
BACKGROUND:
The YAC is a group of volunteer middle school and high school students appointed by the City Council. The YAC’s role is to advise the Parks & Recreation Department and the Youth Center staff on activities, events, and programs to meet the needs of youth in the community.
At the start of each calendar year, the Youth Development Supervisor posts an application for the upcoming YAC open positions on the City’s website. Applicants must complete the online application and submit it by the deadline. Fifteen applicants are offered an oral board interview with City staff, a Parks Recreation and Culture Commission representative, the outgoing YAC Chair, and a City Council representative. The number of open positions each year is dependent on the number of retiring or outgoing YAC members.
ANALYSIS:
The City received 35 applications this year for the open YAC positions. Staff and the YAC Leadership Team completed a screening process of all applications and rated them in four categories: completeness of application; relevant community volunteer experience; creativity of ideas; and professionalism of application. Following the screening and ranking, fifteen applicants were offered an oral board interview which included City staff and a City Council representative.
Following the written application and oral board interview process, the following eight San Carlos youth are being recommended for appointment to the YAC:
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Four Voting Members for the 2026 - 2028 Term:
Anusha Iyengar – Tierra Linda Middle School, 7th Grade Anusha looks forward to creating innovative programs that are representative of the community’s interests and help alleviate the feeling of loneliness. Eva Greenebaum – Nueva School, 10th Grade
Eva would like to be a member of the YAC for a second term to work with like-minded peers to gain a deeper understanding of the functions of local government. Nitya Modi – Central Middle School, 8th Grade
Nitya enjoyed her past year with YAC as a Member-At-Large and is looking forward to facilitating community building programs that create a sense of belonging among San Carlos youth.
Sanvi Sirvastava – Carlmont High School, 9th Grade
Sanvi is an experienced leader who is looking forward to promoting current, and new, resources that support youth in areas such as mental health, academic stress, and sustainability.
Two Voting Members for the 2026 - 2027 Term:
Maya Kacholiya – Carlmont High School, 12th Grade
Maya is a dedicated community member who would like to continue building upon her previous term by helping make decisions that positively affect the youth living in San Carlos.
Nikhil Nunna – Carlmont High School, 12th Grade
Nikhil is a passionate advocate for giving San Carlos youth a new way to engage with their community. Nikhil is committed to organizing events that serve the current needs of youth of San Carlos.
Two Alternate Members for the 2026 - 2027 Term:
• Doris Lin – Carlmont High School, 11th Grade – 1st Alternate Doris is a diligent volunteer and is driven to looking to continue creating programs that improve the experience of teens who are navigating the job search while in high school. • Zuri Kadiwar – Sequoia High School, 10th Grade – 2nd Alternate Zuri plans to build upon her past three years as a YAC Voting Member and Member-At- Large by leading projects that amplify youth voices and build community.
Recognition of Retiring Youth Advisory Council Voting Members The following YAC members completed their term of office as of June 30, 2026:
Ellora Mehta – two, two-year terms; offices held: Public Relations, Chair
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Hanna Kent – one, two-year term
Aditya (Tiko) Gupta – one, two-year term and one, one-year term Connor Huh – one, two-year term and one, one-year alternate term ALTERNATIVES:
The alternatives available to the City Council include:
1. Appoint the recommended YAC members and alternates for the 2026 - 2028 and 2026 - 2027 terms, and recognize retiring YAC voting members; or
2. Do not appoint recommended YAC members and alternates; or
3. Provide staff with alternative direction.
Respectfully submitted by:
Amy Newby, Parks & Recreation Director
Approved for submission by:
__________________________________
Kathy Kleinbaum, City Manager
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Consideration of Adopting a Resolution Adopting a Technology Disruption Policy, Pursuant to Senate Bill 707.
RECOMMENDATION:
Staff recommend that the City Council adopt a Resolution adopting a Technology Service Disruption Policy, pursuant to Senate Bill (SB) 707.
FISCAL IMPLICATIONS:
There are no fiscal implications, and no additional funding is needed.
BACKGROUND:
On October 3, 2025, Governor Newsom signed SB 707 into law, enacting extensive updates to the Brown Act - the primary open meeting law governing local agency legislative bodies - to expand public participation requirements for local legislative bodies.
Among its provisions, SB 707 requires legislative bodies to adopt, on or before July 1, 2026, a policy addressing disruptions to telephonic or internet-based meeting access during public meetings. The policy must establish procedures for recessing and reconvening meetings in the event of a service disruption and identify the good-faith efforts the City will undertake to restore access.
ANALYSIS:
SB 707 establishes specific requirements for the content of the Technology Disruption Policy. If a technological disruption prevents public access to a meeting, the City Council must recess the open session and make a good-faith effort to restore telephonic or internet service. During that time, the Council may convene in closed session. The City Council may not reconvene the open session until at least one hour after the disruption occurs, or until service is restored—whichever occurs first.
If service cannot be restored within one hour, the City Council may resume the meeting only after adopting a finding by roll-call vote confirming that good-faith efforts were made to restore service and that the public interest in continuing the meeting outweighs the need for remote access, consistent with California Government Code section 54953.4(b)(1).
A proposed Technology Disruption Policy that satisfies SB 707 is attached as Attachment 2. If adopted, the policy will take effect on July 1, 2026.
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The action before the City Council addresses one component of SB 707’s new requirements. Staff continue to implement additional provisions of the legislation and will provide future updates to the City Council and make available on the City’s website.
ALTERNATIVES:
The alternatives available to the City Council include:
1. Adopt a Resolution Adopting a Technology Disruption Policy, pursuant to SB 707; or
2. Do not adopt the Resolution; or
3. Provide staff with alternative direction.
Respectfully submitted by:
Crystal Mui, City Clerk
Approved for submission by:
__________________________________
Kathy Kleinbaum, City Manager
ATTACHMENT(S):
1. Resolution
2. Proposed Technology Disruption Policy
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RESOLUTION NO. 2026 – ____
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS ADOPTING A TECHNOLOGY DISRUPTION POLICY, PURSUANT TO SENATE BILL 707.
WHEREAS, on October 3, 2025, Governor Newsom signed SB 707 into law, enacting extensive updates to the Brown Act to expand public participation requirements for local legislative bodies; and
WHEREAS, among its provisions, SB 707 requires legislative bodies to adopt, on or before July 1, 2026, a policy addressing disruptions to telephonic or internet-based meeting access during public meetings; and
WHEREAS, SB 707 establishes specific requirements for the content of the Technology Disruption Policy. If a technological disruption prevents public access to a meeting, the City Council must recess the open session and make a good-faith effort to restore telephonic or internet service. During that time, the Council may convene in closed session; and WHEREAS, the City Council may not reconvene the open session until at least one hour after the disruption occurs, or until service is restored—whicheve r occurs first; and WHEREAS, if service cannot be restored within one hour, the City Council may resume the meeting only after adopting a finding by roll-call vote confirming that good-faith efforts were made to restore service and that the public interest in continuing the meeting outweighs the need for remote access, consistent with California Government Code section 54953.4(b)(1); and WHEREAS, if adopted, the policy will take effect on July 1, 2026.
NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council hereby adopts the proposed Technology Disruption Policy.
* * * * *
I, City Clerk Crystal Mui, hereby certify that the foregoing Resolution was duly and regularly passed and adopted by the City Council of the City of San Carlos at a scheduled meeting thereof held on the 26th day of May 2026, by the following vote:
________________________________
CITY CLERK
of the City of San Carlos
APPROVED:
___________________________
MAYOR of the City of San Carlos
AYES, COUNCILMEMBERS:
NOES, COUNCILMEMBERS:
ABSENT, COUNCILMEMBERS:
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Council Adopted via Resolution 2026-___
City of San Carlos
City Council Technology Disruption Policy
Background
Senate Bill 707 (2025) amended the Brown Act to require eligible legislative bodies to adopt, on or before July 1, 2026, a policy addressing how the agency will respond to disruptions in telephonic or internet service that prevent members of the public from attending or observing a meeting remotely.
This policy is adopted to comply with that requirement and to ensure continuity of public participation during technical disruptions.
Purpose
This policy establishes procedures for responding to a disruption in the telephonic or internet services that provide two-way remote public access to meetings of the City of San Carlos City Council, as required by the Brown Act (Gov. Code § 54953.4(b)(1)). The policy ensures transparency, public participation, and continuity of government during technology disruptions.
Definitions
For purposes of this policy:
“Disruption” means any failure, outage, or other interruption that prevents members of the public from attending or observing the meeting via these remote access services. “Remote access services” means the two-way telephonic service and/or two-way audiovisual platform used to provide real-time remote public attendance and observation of meetings.
Applicability
This policy applies to all open and public meetings of the City Council at which remote public participation is offered or required under the Brown Act.
Procedures in the Event of a Service Disruption
Response to Service Disruption. If the Presiding Officer or Clerk becomes aware of a disruption to the agency’s remote access services that prevents members of the public from attending or observing the meeting remotely:
1. The Mayor or Clerk shall immediately announce the disruption to the public.
2. The Mayor may then call for a recess of the open session or convene the legislative body
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3. Staff shall begin efforts to diagnose and restore the disrupted service.
4. The meeting shall remain in recess for at least one hour or until service is restored, whichever is sooner. The recess period may be extended if restoration efforts are ongoing.
Efforts to Restore Service. The agency shall make good faith efforts to restore remote access services, which may include:
Troubleshooting platform or teleconferencing software Resetting or replacing audiovisual equipment
Attempting alternative connection methods
Contacting necessary support staff or service providers Switching to back-up equipment or platforms, if available Reconvening the Open Session. The open session may be reconvened after at least one hour has elapsed from the time of disruption or as soon as service is restored, whichever occurs earlier. - If Service Is Restored. If the remote access service is restored before or at the time the meeting reconvenes, the meeting shall continue as normal.
- If Service Is Not Restored. If service has not been restored after one hour, the City Council may reconvene and:
1. Adjourn the meeting; or
2. Continue the meeting in open session by adopting, by roll call vote, the following, or a substantially similar, finding:
“The City of San Carlos has made good faith efforts to restore telephonic or internet service in accordance with its adopted policy, and the public interest in continuing the meeting outweighs the public interest in remote public access.” Upon adoption of the finding, the legislative body may continue the open session despite the fact that remote access services have not been restored.
Recordkeeping
The Clerk shall enter a brief statement into the meeting minutes, including the following:
The nature and time of the disruption
The restoration efforts undertaken
The time the meeting was reconvened (if applicable)
Any finding adopted if service is not restored
Review and Updates
This policy may be amended by the City Council at a noticed public meeting in open session.
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Receive an Update on the Implementation of the 2021 San Carlos Climate Mitigation and Adaptation Plan.
RECOMMENDATION:
Staff recommend that the City Council receive an update on the implementation of the 2021 San Carlos Climate Mitigation and Adaptation Plan.
FISCAL IMPLICATIONS:
There are no fiscal implications, and no additional funding is needed.
BACKGROUND:
The San Carlos City Council adopted the Climate Mitigation and Adaptation Plan (CMAP) in September 2021. The CMAP serves as the City’s blueprint for addressing climate change by mitigating its impacts through reductions in local greenhouse gas (GHG) emissions and adapting to climate-related hazards. The CMAP set a target to reduce emissions 40% by 2030 and 80% by 2050, relative to 1990 levels as required under Senate Bill 32, and identifies 33 GHG reduction strategies and 12 adaptation strategies to achieve these goals.
Implementation of the 45 strategies contained within the CMAP is a collaborative effort across different City departments, community groups, and regional agencies. The City’s sustainability staff provides annual updates on the implementation status of the strategies to the City Council.
ANALYSIS:
The 2026 CMAP Summary Report, included as Attachment 1, provides a summary of actions taken between March 2025 and March 2026 that make meaningful contributions towards San Carlos’ climate goals.
A few key highlights include:
MTC EV Charging Infrastructure Grant. In March 2025, the City of San Carlos was awarded the Metropolitan Transportation Commission’s (MTC) 2024 Climate Program Implementation Grant for expanding public electric vehicle charging infrastructure in downtown. The City applied for the grant in collaboration with the County of San Mateo and the cities of Portola Valley, Half Moon Bay, and East Palo Alto. The City will receive $658,131 to fund six, curbside EV charging stations on the 700 block of Walnut Street near 737 and 777 Walnut Street; three curbside chargers on the 600 block of Walut Street near 657 Walnut Street; five EV charging stations in the Wheeler Plaza
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Garage; and four EV charging stations in Clark Plaza. At this time, City staff is working with staff from other grant-recipient cities on formalizing an approach for coordinated procurement of project management and design services for the EV charging infrastructure. ACC Solar. As of March 1, 2026, the San Carlos Adult Community Center (ACC) Solar Photovoltaic System became fully operational and started generating renewable electricity for the City. The project was completed in partnership with WestLight Energy (formerly Peninsula Clean Energy) under a Power Purchasing Agreement and produces 100% clean energy while helping reduce energy costs for the City. The new solar system is expected to produce over 70,000 kWh of clean electricity annually, resulting in projected energy cost savings of over $128,800 over the next 20 years. Adopt A Drain Program. In October 2025, the City launched its Adopt-a-Drain program to reduce localized flooding and protect water quality in creeks and the San Francisco Bay. The program encourages residents, businesses, and local groups to “adopt” a nearby drain and commit to keeping it clean before and after a storm. As of March 2026, the program has over 110 drains adopted, 130 cleaning sessions reported, and over 800 pounds of trash removed. The City continues to conduct outreach to encourage adoptions and regular cleanups to protect the health of local waterways and reduce flooding. Electric Leaf Blower Program. At its February 23, 2026 meeting, the City Council approved the creation of the San Carlos Electric Leaf Blower Rebate program to support the transition to the use of electric technology for leaf blowers. The program supports the phase-out of gas-powered leaf blowers associated with Assembly Bill 1346. The program offers a rebate to San Carlos residents and landscaping businesses in the form of a refund for the purchase of electric leaf blowers and associated batteries. The program started receiving applications in March, and the City is conducting active outreach to promote the adoption of electric leaf blowers. As of the date of this report, the City has received forty- four (44) applications.
In addition to implementing strategies under the CMAP, staff also track progress on the City’s GHG reduction targets through the inventory provided by the County’s Regionally Integrated Climate Action Planning Support (RICAPS) program. The RICAPS program does an assessment of citywide GHG emissions on a bi-annual basis. The most recent GHG community emissions inventory is available for the year 2023, which was provided to the City Council as part of the 2025 CMAP Annual Report. The 2025 GHG emissions inventory is expected to be available in the summer of 2026.
CMAP Update
At its May 11, 2026 meeting, the City Council authorized the City Manager to enter into a contract with consultant, Blue Strike Environmental, to prepare an update to the CMAP. An update to the CMAP is mandated as a mitigation measure adopted under the Environmental Impact Report (EIR) associated with the City’s 2045 General Plan Reset project. The project was adopted in May 2025, and the associated EIR identified a significant impact related to the GHG emissions associated with the anticipated growth in the City over the next 20 years. The mitigation measure adopted by the City Council as part of the CEQA-mandated Mitigation Monitoring and Reporting Program requires an update to the City’s 2021 CMAP by May 2028. The CMAP Update will consider updated growth projections to the year 2045, and help chart a course to carbon net- neutrality as required under the Assembly Bill 1279.
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Respectfully submitted by:
Al Savay, Community Development Director
Approved for submission by:
__________________________________
Kathy Kleinbaum, City Manager
ATTACHMENT(S):
1. 2026 CMAP Annual Report
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2026 Climate Mitigation and Adaptation Plan Annual Report
INTRODUCTION
The San Carlos City Council adopted the Climate Mitigation and Adaptation Plan (CMAP) in September 2021. The CMAP serves as the City’s blueprint for addressing climate change by mitigating its impacts through reductions in local greenhouse gas (GHG) emissions and adapting to climate-related hazards.
The CMAP establishes the target of reducing emissions 40% by 2030 and 80% by 2050 relative to 1990 levels and identifies 33 GHG reduction strategies and 12 adaptation strategies to achieve these goals. Implementation of the 45 strategies contained within t he CMAP is a collaborative effort across different City departments, community groups, and regional agencies.
The 2026 CMAP Annual Report provides a summary of activities undertaken during the reporting period from March 2025 to March 2026 that make meaningful contributions towards San Carlos’ climate goals. The County’s Regionally Integrated C limate Action Planning Support (RICAPS) program does an assessment of the community GHG emissions inventory on a bi-annual basis.
The most recent emissions inventory is available for the year 2023 which was provided to the City Council as part of the 2025 CMAP Annual Report. The 2025 GHG emissions inventory is expected to be available in Summer 2026.
SELECTED CMAP STRATEGIES
Strategy 1: Regional Energy Conservation and Efficiency Programs The City promoted several regional energy conservation and efficiency programs through its website, e- news, and social media during the reporting period. Some of the key initiatives promoted include the San Mateo County's Go Electric campaign which provides a wide range of resources to help residents electrify their homes; Bay Area Air District’s Clean Heating Efficiently with Electric Technology (Clean HEET) program that provides homeowners incentives to install electric heat pumps; and BayREN’s Efficiency And Sustainable Energy Home (EASE Home) Program that helps Bay Area residents make their homes healthier, more comfortable, and energy efficient through upgrades like insulation and duct sealing.
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Strategy 6: Rooftop Solar
Over the reporting period, Public Works staff worked closely with WestLight Energy ( formerly Peninsula Clean Energy) to develop plans for installing new solar panels at the Adult Community Center and Library, as well as replacing outdated solar panels at the Corporation Yard. The Library and Corporation Yard projects are currently in progress. To mitigate potential risks, Staff has conducted early design reviews, verified site conditions, and coordinated project schedules to minimize disruptions to facility operations. Additional s trategies include incorporating contingency funding for unforeseen conditions, verifying contractor qualifications, and maintaining clear communication throughout the project to support timely and efficient implementation.
As of March 1, 2026, the San Carlos Adult Community Center (ACC) Solar Photovoltaic System became fully operational and started generating renewable electricity for the City. The project was completed in partnership with WestLight Energy under a Power Purchasing Agreement and produces 100% clean energy while helping reduce energy costs for the City. The new solar system is expected to produce over 70,000 kWh of clean electricity annually, resulting in projected energy cost savings of over $128,800 over the next 20 years.
Strategy 7: WestLight Energy
The City continues to promote WestLight Energy as the community's official energy provider. As part of its commitment to GHG reduction goals, the City continues to source 100% clean energy from WestLight Energy. City also actively provides information regarding the environmental and economic benefits of this partnership to its residents. Since 2016, WestLight Energy has helped San Carlos customers reduce both emissions and energy costs, and an assessment of savings is conducted on a regular basis. According to the assessment done in 2025, this accounts for over $7.9 Million in savings and 98% reduction in greenhouse gas emissions from electricity for San Carlos customers. Further, the City continues to provide information about WestLight Energy programs for electrification to homeowners and businesses through its website, e-news, and social media.
Strategy 10: PSPS and Emergency Response
To ensure the community is prepared in the case of an emergency, the City continues to provide emergency preparedness information and conduct related outreach with mailers and across our
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digital communications channels. Last Summer, Staff created an Emergency Preparedness and Public Safety video playlist on City’s Youtube channel that included newly launched videos such as "Get Informed, Stay Prepared, and Stay Safe in the City of Good Living" and "What's In My Go-Bag?". Staff also created and mailed a Spotlight on Emergency Preparedness and hosted a Community Emergency Kit Giveaway.
Strategy 11: Transit-Oriented Development
Over the reporting period, Staff continued evaluating San Carlos' existing land use, housing, and transportation policies for consistency with the Metropolitan Transportation Commission's (MTC) Transit-Oriented Communities (TOC) Program. The TOC Program aims to maximize housing and employment opportunities near transit stations (including the San Carlos Caltrain Station).
The TOC will be an incentive-based program providing access to County transportation funding.
Staff will review the latest program modifications from MTC to determine how San Carlos may fare in achieving TOC compliance. Separately, the City is preparing for density increases near transit in compliance with Senate Bill (SB 79), which allows residential development within 0.25 miles of the Caltrain Station at densities of 120 units per acre. While the City has elected to exclude all excludable sites until the next Housing Element cycle, a significant amount of zoning in this area already allows for densities as high as 120 units per acre. Meanwhile, several new residential developments are underway along the El Camino Real Corridor which is a part of the identified TOD corridor in the General Plan.
Strategy 12: Active Transportation
The City has advanced projects that make walking and bicycling safer, more convenient, and more appealing across San Carlos. The Crestview Pilot Project will introduce approximately two miles of new buffered bike lanes along the corridor, improving comfort and connectivity for cyclists while supporting traffic calming. The City is also advancing multimodal improvements through the Holly–US 101 corridor, with medium-term plans to install protected and buffered bike lanes through the interchange, and a long -term vision for a grade- separated bicycle and pedestrian overcrossing. San Carlos has actively pursued funding for these efforts, and design is anticipated to begin soon.
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Strategy 13: Neighborhood Hubs
The Northeast Area Specific Plan will bring forward a refreshed list of permitted uses, which will include allowance for general retail and convenience markets by -right on the ground floor with emphasis on building corners. Sites within the Northeast Area currently must obtain a minor use permit to allow retail uses. Being more permissive with these uses through the Northeast Area Specific Plan will contribute to a more walkable and vibrant neighborhood atmosphere.
Additionally, d uring counter inquiries and discussions related to development applications , developers are strongly encouraged to incorporate or apply for a Neighborhood Hub outside of the NEASP pursuant to SCMC Chapter 18.13 to provide neighborhood- serving retail and services.
Strategy 14: Public Curbs
The City is currently working on a Transportation Demand Management and Parking Reform project. As part of this project, an approach to curb management will be presented for City Council consideration in Fall 2026. This could include modified time limits a t key locations for passenger pick up and drop off. This could also include improved procedures for reviewing and approving public curb designation to respond to community needs more efficiently. These efforts enhance the City's use of public curb space and can favor passenger pick-up and drop-off areas where appropriate.
Strategy 15: Public Transportation
The City supports improvements to public transit routes, services, and facilities to better facilitate long-distance travel. Planned enhancements along the Holly –US 101 corridor will improve bicycle access to the San Carlos Caltrain Station from both sides of US 101, strengthening first- and last-mile connections. The City also continues to participate in the Grand Boulevard Initiative and collaborate with SamTrans to improve active transportation access to the station and enhance bus stop connectivity and amenities along the El Camino Real corridor.
Strategy 16: Public Spaces
The Downtown Streetscape Master Plan and Downtown Specific Plan were adopted in April 2025 and November, 2025, respectively. These plans call for enhancements to the public realm, including wider sidewalks and new plazas - including an entire City block closed to pedestrians
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and designed with rain gardens , new trees, paving, pavilion, public seating, expanded outdoor dining, and streetscape amenities including bicycle racks and supports.
The Objective Design Standards, adopted November 2025, for mixed- use and multi -family zoning districts establish setback requirements for improvements within the property line and the curb, including sidewalks and street trees, to facilitate wider pedestrian areas and enhanced landscaping. These standards also require corner design elements that create plazas and corner spaces, contributing to a more complete and engaging public realm. All new development within these districts is subject to these requirements.
Strategy 17: Vehicle Miles Traveled
Pursuant to SCMC Chapter 18.25, large developments are subject to the Transportation Demand Management (TDM) Plan and associated trip- reduction measures. These regulations apply to all developments exceeding the established thresholds and require implementation of TDM strategies to achieve a 20% trip reduction as well as trip reductions as required by C/CAG.
A few examples of required measures include shuttle programs, bicycle parking facilities, and on-site showers. Multiple projects have been subject to these requirements, including Alexandria Life Science, 11 El Camino Real, 1232 Cherry Street, among others.
Additionally, the City is currently working on a Transportation Demand Management update, including increasing the required amount of trip reductions and more robust and meaningful trip reduction strategies. These updates are anticipated for adoption in Fall 2026.
Strategy 18: Electric Vehicles
The City of San Carlos is supporting the transition to EVs by actively seeking grants and promoting incentives for expanding EV charging infrastructure in the City . In March 2025, the City of San Carlos was awarded the Metropolitan Transportation Commission’s (MTC) 2024 Climate Program Implementation Grant for expanding public electric vehicle charging infrastructure in downtown. The grant was applied in collaboration with the County of San Mateo and the cities of Portola Valley, Half Moon Bay, and East Palo Alto. The City will receive $658,131 to fund six curbside EV charging stations on the 700 block of Walnut Street near 737 and 777 Walnut Street; three curbside chargers on the 600 block of Walut Street near 657 Walnut Street; five EV charging stations in the Wheeler Plaza Garage; and four EV charging stations in Clark Plaza.
The City continues to support the development of EV charging infrastructure in m ulti-family buildings through San Carlos’ EV Charging Incentive Program for Multi -family Buildings which
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was established in 2023 in partnership with WestLight Energy. Under the program, the City provides a 50% match up to a maximum of $20,000 per project to the incentives provided by WestLight Energy under its EV Ready program. In August 2025, City amended the agreement with WestLight Energy to extend the term of the agreement until July 2029. As of September 2025, six projects that have secured program funding through the program represent a total of 143 EV chargers installed in multi-family properties throughout San Carlos.
Additionally, in November 2025, City staff participated in the San Carlos EV Showcase event organized by a local climate action group called Climate Justice Action. City had a booth at the event to share EV-related resources and staff delivered a presentation to the attendees to share City programs and projects that promote transition to EVs.
Strategy 19: Safe Routes to School
The City continues to advance Safe Routes to School (SRTS) initiatives by upgrading key intersections with high -visibility crosswalks and ADA -compliant curb ramps to improve safety and accessibility for students and families. Staff have conducted walk audi ts at two school campuses and are incorporating those findings into upcoming capital improvement projects. The City has also secured grant funding through the School Travel Fellowship to support targeted improvements near the Tierra Linda/Mariposa campus, including upgrading the traffic signal to video and radar detection to improve traffic flow and reduce congestion. Together, these efforts help reduce greenhouse gas emissions by encouraging walking and biking while decreasing school-related vehicle trips.
Strategy 20: City Fleet
Over the reporting period, the City has replaced four hybrid vehicles with fully electric models, bringing the City’s total to nine all -electric vehicles. This transition supports the City’s sustainability goals by reducing greenhouse gas emissions, lowering fuel and maintenance costs, and improving air quality. Staff will continue to evaluate opportunities to expand the all - electric fleet as technology and operational needs allow.
Strategy 23: Clean-fuel Construction and Landscaping
At its February 23, 2026 meeting, City Council approved the creation of the San Carlos Electric Leaf Blower Rebate program to support the transition to the use of electric technology for leaf blowers. The program supports the phase-out of gas -powered leaf blowers associated with Assembly Bill 1346. The program offers a rebate to San Carlos residents and landscaping
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businesses in the form of a refund for the purchase of electric leaf blowers and associated batteries. The program started receiving applications in March and the City is conducting active outreach to promote the adoption of electric leaf blowers.
Strategy 25: Material Reuse and Repair
San Carlos promoted material reuse initiatives by Rethink Waste, including the Sustainable Fashion Swap event held on August 24, 2025. The event encouraged residents to bring clothing, shoes, and accessories in good condition to exchange for something new to them from the collection.
Additionally, City staff worked with the Youth Advisory Council to support the development of the Sustainable Holiday Gifting Guide. The guide provide d ideas and resources on sourcing eco- friendly gifts, including a range of items that are recycled and reused.
Strategy 30: Sustainable Food Consumption
City staff participated in discussions and provided input to Sustainable San Mateo County (SSMC) on the development of their 2025 Indicator Report on Local Food Actions for a Cooler Future. According to the report, food consumption accounted for 17% of tot al household emissions in San Mateo County in 2023, ranking third after transportation and services (e.g., health care, entertainment), and ahead of housing and goods. City provides this information to the community through its website and shares resources provided by SSMC to help support the transition to a sustainable diet.
Strategy 37: Heat Island Effect
The Downtown Specific Plan, adopted on November 24, 2025, promotes a vision for a green, sustainable, and resilient Downtown through Public Realm policies . These policies require extensive greening in Downtown, including integration of rain gardens , native and drought - tolerant landscaping, street trees, and other green infrastructure to improve air quality and mitigate the heat island effect.
San Carlos Municipal Code Section 18.20.070(K) establishes development standards designed to reduce Urban Heat Island effects. Projects are reviewed for compliance with these standards to help minimize surface temperatures in parking areas.
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The San Carlos Avenue Pedestrian Safety Improvements - Phase 3 Project (Devonshire Boulevard to Beverly Drive) installed approximately 1,150 square feet of bio- retention green infrastructure improvements consisting of soil and plantings which help filter out surface and chemical pollutants before entering the City's storm drain system, improve air quality and mitigate the heat island effect.
Strategy 39: Sea Level Rise
City staff c ontinues to collaborate with OneShoreline to develop a comprehensive Shoreline Adaptation Plan for the southern Bayside cities in San Mateo County. The plan will assess flood vulnerabilities and identify adaptation strategies for low -lying developed lands, infrastructure, trails, coastal habitats, and open space. The plan will align with the B ay Conservation and Development Commission’s (BCDC) Regional Shoreline Adaptation Plan (RSAP) guidelines and will fulfill the requirements of Senate Bill 272 for the City.
The project is funded by the Ocean Protection Council (OPC) and will support all tasks, including administration, coordination, and reporting; technical engagement; community engagement; updating existing conditions and vulnerability assessment; and development of the Plan.
Strategy 40: Disaster Preparedness Information
The City led the San Carlos and Redwood City Fire Department, County of San Mateo Emergency Management, and Cal Water Service to produce a Wildfire Preparedness Webinar in the summer of 2025. The webinar emphasized not just how residents can prepare, but also how the City and our partners prepare and respond to wildfires.
Disaster preparedness information can be found at cityofsancarlos.org/emergency and its associated pages covering heat safety, wildfire preparedness, and storm and flood preparation.
With the language tool on our website, any webpage can be translated into another language.
Staff updates the content as needed and when disaster -related updates are needed.
Strategy 41: Community Wildfire Protection Plan
CAL FIRE has requested updates to the San Mateo County Community Wildfire Protection Plan (CWPP), and the Fire Department been working with the City’s Parks and Recreation Department to develop an update that reflects our local priorities and conditions. The team is in the process of finalizing updates and comments and is on track to submit to CAL FIRE by the April 2026 deadline.
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Strategy 43: Fire Risk Reduction Assessment
The Fire Department is currently in the process of completing a Community Risk Assessment (CRA) as part of the Vision 20/20 project. This effort includes several components directly related to wildfire preparedness and mitigation opportunities, including ident ification of key risk factors, vulnerable areas, and potential strategies to reduce community risk. As part of this work, there is a strong opportunity to build on the CRA findings to inform the development of a fire risk reduction assessment tool that can be used by project applicants and City staff during the development review process. This could help identify site- specific risks and incorporate appropriate mitigation measures, such as vegetation management, defensible space, access, and building design considerations . Fire staff anticipates that the CRA will provide a solid foundation to support and guide the development of this type of tool moving forward.
Strategy 45: Flooding and Pond Water
City staff continues to collaborate with City of Redwood City on the Redwood Shores Sea Level Rise Protection Project. Project objectives include sea- level rise resilience and obtaining a FEMA-compliant certification for flood protection from Belmont Creek to Pulgas Creek. The project will protect homes, schools, businesses and critical infrastructure.
In October 2025, the City launched its Adopt -a-Drain program to reduce localized flooding and protect water quality in creeks and the San Francisco Bay. The program encourages residents, businesses, and local groups to adopt a nearby drain and commit to keeping it clean before and after a storm. As of March 2026, t he program has over 1 10 drains adopted, 130 cleaning sessions reported, and over 800 pounds of trash removed collectively. The city continues to conduct outreach to encourage adoptions and regular cleanups to protect the health of local waterways and reduce flooding.
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CITY COUNCIL
STAFF REPORT
MEETING DATE: May 26, 2026
ITEM TITLE: Consideration of Adopting a Resolution Accepting a Report on the City of San Carlos’ Workforce Vacancies, Recruitment, and Retention Trends as Required Under Assembly Bill (AB) 2561.
RECOMMENDATION:
Staff recommend that the City Council receive the annual report update on the City of San Carlos’ workforce vacancies, recruitment, and retention trends as required under Assembly Bill (AB) 2561.
FISCAL IMPLICATIONS:
There are no fiscal implications associated with this report, and no additional funding is needed.
BACKGROUND:
AB 2561, signed into law on September 22, 2024, amended the Meyers-Milias-Brown Act (MMBA) and established new transparency obligations for public agencies. Under this legislation, agencies must publicly report workforce vacancies and provide an overview of recruitment and retention efforts at least once per fiscal year, prior to adoption of the annual budget.
As part of the required presentation, agencies must also describe any internal policies, procedures, or recruitment practices that could create barriers to hiring.
Upon request from a represented employee organization—and only when vacancies reach or exceed 20 percent within a bargaining unit—additional details must be provided, including:
Total vacancies within the bargaining unit
Number of applicants for open positions
Average number of days required to complete the hiring process Potential opportunities to enhance compensation or improve working conditions AB 2561 also guarantees labor groups the right to address the governing body during the same public meeting.
ANALYSIS:
The City of San Carlos has four employee groups (two represented and two unrepresented) consisting of 104 budgeted full-time positions.
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The number of budgeted full-time positions by employee group for fiscal year 2025-26 are listed below:
• AFSCME. Local 829: 37
• Teamster, Local 856: 21
• Unrepresented Confidential Group: 13
• Unrepresented Management Group: 33
Vacancies
Vacancies occur for a range of reasons—newly approved positions, internal promotions or transfers, retirements, resignations, or separations. In order to maintain service standards, ensure operational continuity, and support the community’s needs, filling vacancies remains a priority for the Human Resources Division and all City departments.
Below is a summary of vacancy rates by bargaining group as of April 30, 2026:
• AFSCME, Local 829: 0.00%
• Teamster, Local 856: 9.5% (2 positions)
• Unrepresented Confidential Group: 0.00%
• Unrepresented Management Group: 3.0% (1 position)
No bargaining unit met or exceeded a 20% vacancy threshold this fiscal year.
Retention
The City’s retention rate through April 30, 2026 remains strong at approximately 94%, consistent with the City’s ongoing focus on employee engagement and stability. Retention is calculated by comparing the number of employees active at the start of April 30, 2025, to those still employed as of April 30, 2026.
The City continues to prioritize overall employee well-being through a combination of:
Hybrid telework options that reduce commute times
Encouragement of regular time off to support healthy work–life balance Access to the Employee Assistance Program and wellness spaces A robust training and development program, including strengths-based initiatives Tuition reimbursement for job-related education and career growth opportunities These programs support a workplace culture that values employee growth, fosters engagement, and builds long-term commitment to the organization.
In closing, the City has continued to make notable progress in managing vacancies and strengthening recruitment processes. Retention remains a key area of emphasis, and current efforts focused on wellness, recognition, development, and communication support the City’s long-term goal of cultivating a thriving and stable workforce.
ALTERNATIVES:
The alternatives available to the City Council include:
1. Adopt a Resolution receiving a report on the City of San Carlos workforce vacancies, recruitment, and retention trends as it related to AB 2561; or
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2. Do not accept the Resolution; or
3. Provide staff with alternative direction.
Respectfully submitted by:
Rebecca Mendenhall, Administrative Services Director
Approved for submission by:
__________________________________
Kathy Kleinbaum, City Manager
ATTACHMENT(S):
1. Resolution
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RESOLUTION NO. 2026 – ____
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN CARLOS ACCEPTING A REPORT ON THE CITY OF SAN CARLOS’ WORKFORCE VACANCIES,
RECRUITMENT, AND RETENTION TRENDS AS REQUIRED UNDER
ASSEMBLY BILL (AB) 2561.
WHEREAS, Assembly Bill (AB) 2561, signed into law on September 22, 2024, establishes new legal obligations for the City to report the status of their workforce vacancies and recruitment and retention efforts during a public hearing before the City Council at least once per fiscal year; and
WHEREAS, AB 2561 also requires the City to identify during the public hearing any necessary changes to City policies, procedures, and recruitment activities that may contribute to obstacles in the City’s hiring process; and
WHEREAS, under AB 2561, the recognized employee organization for a bargaining unit is entitled to make a presentation to the City Council during the public hearing; and WHEREAS, procedural rules and policies regarding this public hearing are intended to ensure a fair, orderly, and efficient hearing process.
NOW, THEREFORE BE IT RESOLVED, that the San Carlos City Council hereby accepts the report on the City of San Carlos workforce vacancies, recruitment, and retention trends established under Assembly Bill 2561.
* * * * *
I, City Clerk Crystal Mui, hereby certify that the foregoing Resolution was duly and regularly passed and adopted by the City Council of the City of San Carlos at a scheduled meeting thereof held on the 26th day of May 2026, by the following vote:
________________________________
CITY CLERK of the City of San Carlos
APPROVED:
___________________________
MAYOR of the City of San Carlos
AYES, COUNCILMEMBERS:
NOES, COUNCILMEMBERS:
ABSENT, COUNCILMEMBERS:
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