San Mateo City Council
June 16, 2025

CIP BUDGET
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Total City Transfers $ 66,590,943 $ 64,550,893
Less Capital Improvement Projects Transfers 46,054,000 51,944,000 Total Operating Transfers $ 20,536,943 $ 12,606,893
Total Capital Improvement Projects Transfers $ 46,054,000 $ 51,944,000 Add Capital Improvement Projects Revenue & Fund Balance 19,194,363 9,596,857 Total Capital Improvement Projects Budget $ 65,248,363 $ 61,540,857 10%
5%
43%
1%
24%
17%

CAPITAL IMPROVEMENT PROJECTS BUDGET
2025-26 ($61.5 MILLION)
General Fund
Measure S
Sewer Fund (Clean Water
Program)
Stormwater Fee
Taxes, Fees, and Charges
Other Sources
35 779 of 1111
Schedule of Interfund Transfers
In Out
General Fund
From Measure S Tracking Fund $ 339,032 $ -
From Construction Services Fund 530,000 -
From Gas Tax Fund 1,747,500 -
To Housing Set Aside Reserve Fund - 1,100,000
To 2% Hotel Tax Fund - 350,000
To Downtown Services Fund - -
To Recreation Services Fund - 5,440,361
To Capital Projects Fund - 5,050,000
To Vehicle and Equipment Replacement Fund - 410,000
Total $ 2,616,532 $ 12,350,361
Measure S Tracking Fund
To General Fund $ - $ 339,032
To Street and Flood Control Projects Bond Fund - 2,690,000 To Capital Projects Fund - 3,000,000
Total $ - $ 6,029,032
Measure CC Fund
To Capital Projects Fund - 875,000
Total $ - $ 875,000
Housing Set Aside Fund
From General Fund $ 1,100,000 $ -
Total $ 1,100,000 $ -
Downtown Services Fund
From General Fund $ - $ -
Total $ - $ -
Recreation Services Fund
From General Fund $ 5,440,361 $ -
Total $ 5,440,361 $ -
Community Development Block Grant Fund
To Capital Projects Fund $ - $ 617,000
Total $ - $ 617,000
Construction Services Fund
To General Fund $ - $ 530,000
To Capital Projects Fund - 390,000
Total $ - $ 920,000
Gas Tax Fund
To General Fund $ - $ 1,747,500
To Capital Projects Fund - 1,253,000
Total $ - $ 3,000,500
Parks and Recreation Revenue Fund
To Capital Projects Fund $ - $ 2,250,000
Total $ - $ 2,250,000
Traffic Impact Fee Fund
To Capital Projects Fund $ - $ 850,000
Total $ - $ 850,000
2025-26 PROPOSED BUDGET
Transfer FUND
36 780 of 1111
Schedule of Interfund Transfers
In Out
Road Maintenance and Rehabilitation Account Fund
To Capital Projects Fund $ - $ 2,700,000
Total $ - $ 2,700,000
Landfill Fund
To Capital Projects Fund $ - $ 1,120,000
Total $ - $ 1,120,000
Street and Flood Control Project Fund
From Measure S Tracking Fund $ 2,690,000 $ -
Total $ 2,690,000 $ -
2% Hotel Tax Fund
From General Fund $ 350,000 $ -
Total $ 350,000 $ -
Storm Fund
To Capital Projects Fund $ - $ 3,400,000
Total $ - $ 3,400,000
Sewer Fund
To Capital Projects Fund $ - $ 29,639,000
Total $ - $ 29,639,000
Vehicle and Equipment Replacement Fund
From General Fund $ 410,000 $ -
To Capital Projects Fund $ - $ 800,000
Total $ 410,000 $ 800,000
Workers' Compensation Fund
To Comprehensive Liability Fund $ - $ -
Total $ - $ -
Comprehensive Liability Fund
From Workers Comp Fund $ - $ -
Total $ - $ -
Capital Projects Fund
From General Fund $ 5,050,000 $ -
From Measure S Tracking Fund 3,000,000 -
From Measure CC Fund 875,000 -
From CDBG 617,000 -
From Construction Services Fund 390,000 -
From Gas Tax Fund 1,253,000 -
From Parks and Recreation Revenue Fund 2,250,000 -
From Traffic Impact Fee Fund 850,000 -
From Road Maintenance and Rehabilitation Account Fund 2,700,000 - From Landfill Fund 1,120,000 -
From Storm Fund 3,400,000 -
From Sewer Fund 29,639,000 -
From Vehicle and Equipment Replacement Fund 800,000 -
Total $ 51,944,000 $ -
Total City Transfers $ 64,550,893 $ 64,550,893
2025-26 PROPOSED BUDGET
Transfer FUND
37 781 of 1111
Full Time Equivalent (FTE) Personnel
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
All Funds All Funds
By Department
City Attorney 5.00 5.00
City Clerk 4.75 4.75
City Council 5.00 5.00
City Manager 9.48 9.48
Community Development 57.92 57.92
Finance 18.00 18.00
Human Resources 11.48 12.48
Information Technology 14.23 14.23
Library 53.16 49.23
Parks and Recreation 116.17 116.17
Police 175.75 174.96
Public Works 166.04 166.04
Total City 636.98 633.26
By Type
Merit Positions 549.14 549.50
Per Diem 88.47 83.76
Total City 637.61 633.26
38 782 of 1111
All Funds Budget Summary

BEGINNING FUND INTERFUND

BALANCE TRANSFERS IN
General Funds
General 1 $ 85,740,902 $ 154,028,761 $ 2,616,532
Measure S Tracking 9,898,269 7,100,000 -
Measure CC Fund 6,907,568 - -
Housing Set Aside Fund 6,387,084 - 1,100,000
Downtown Services 1,524,678 4,251,000 -
Recreation Services - 4,801,000 5,440,361
Golf 1,033,664 3,343,500 -
General Funds Total $ 111,492,164 $ 173,524,261 $ 9,156,893 Special Revenue Funds
Police Grants $ 556,786 $ 1,202,000 $ -
Solid Waste 14,597,381 3,738,000 -
HOME 497,258 15,000 -
Community Development Block Grant 548,849 740,000 -
Advance Planning 6,071,470 2,050,000 -
Construction Services 26,518,777 9,467,550 -
Gas Tax 2,884,192 3,089,188 -
City Housing 1,443,759 66,000 -
Low and Moderate Income Housing Asset 5,350,823 291,446 - Parks and Recreation Revenue 3,779,506 4,692,000 -
Traffic Impact Fee (2,652,760) 1,349,708 -
Commercial Linkage Fee (550,244) 2,550,000 -
Road Maintenance and Rehabilitation Account 1,805,202 3,063,176 - Permanent Local Housing Allocation 10,024 224,653 -
Landfill Fund 4,496,133 680,000 -
Special Revenue Funds Total $ 65,357,154 $ 33,218,721 $ - Debt Service Funds
Street and Flood Control Projects Bond $ 30,264 $ - $ 2,690,000 General Obligation Bonds 7,159,656 1,590,000 -
2% Hotel Tax 364,067 748,000 350,000
Debt Service Funds Total $ 7,553,987 $ 2,338,000 $ 3,040,000 Capital Improvement Projects Funds
Capital Improvement Projects $ 7,737,223 $ 10,958,293 $ - Capital Improvement Projects Funds Total $ 7,737,223 $ 10,958,293 $ - Enterprise Fund
Storm $ 1,737,115 $ 4,216,000 $ -
Sewer 294,962,860 95,720,550 -
Enterprise Fund Total $ 296,699,975 $ 99,936,550 $ -
Internal Service Funds 2
Vehicle and Equipment Replacement $ 18,494,800 $ 2,208,896 $ 410,000 Fleet and Building Maintenance 649,002 6,140,490 -
Benefits (297,201) 51,055,072 -
Dental 999,146 779,000 -
Workers' Compensation 6,538,811 2,900,000 -
Comprehensive Liability (1,217,736) 5,200,000 -
Internal Service Funds Total $ 25,166,822 $ 68,283,458 $ 410,000 Total City $ 488,840,503 $ 320,745,825 $ 12,606,893
Note: Governmental Funds are presented using a modified accrual basis and Proprietary Funds are presented using a full accrual basis. 1 Vacancy savings shown in the General Fund Long-Term Financial Plan are incorporated in the amounts under the Operating column. 2 For Internal Service Funds, only transfers and investment income are included in totals.

PROPOSED 2025-26 REVENUES
39 783 of 1111
All Funds Budget Summary

INTERFUND ENDING FUND

TRANSFERS OUT
Operating Transfer to CIP Transfer to Capital
Investment Reserve

BALANCE
$ 7,300,361 $ 154,447,500 $ 5,050,000 $ 25,000,000 $ 50,588,333 3,029,032 2,161,116 3,000,000 - 8,808,121
- 200,000 875,000 - 5,832,568
- 86,237 - - 7,400,847
- 4,496,506 - - 1,279,172
- 10,241,361 - - -
- 3,747,764 - - 629,400
$ 10,329,393 $ 175,380,484 $ 8,925,000 $ 25,000,000 $ 74,538,440 $ - $ 1,610,043 $ - $ - $ 148,743
- 4,858,292 - - 13,477,089
- 10,000 - - 502,258
- 488,356 617,000 - 183,493
- 2,357,167 - - 5,764,304
530,000 14,507,442 390,000 - 20,558,884
1,747,500 - 1,253,000 - 2,972,880
- 253,500 - - 1,256,259
- 368,428 - - 5,273,841
- 18,258 2,250,000 - 6,203,249
- - 850,000 - (2,153,052)
- 40,498 - - 1,959,257
- - 2,700,000 - 2,168,378
- 224,653 - - 10,024
- 101,193 1,120,000 - 3,954,940
$ 2,277,500 $ 24,837,830 $ 9,180,000 $ - $ 62,280,545
$ - $ 2,697,954 $ - $ - $ 22,310
- 2,135,229 - - 6,614,427
- 997,768 - - 464,299
$ - $ 5,830,951 $ - $ - $ 7,101,036
$ - $ - $ 9,596,857 $ - $ 9,098,659
$ - $ - $ 9,596,857 $ - $ 9,098,659
$ - $ 1,324,410 $ 3,400,000 $ - $ 1,228,705
- 64,601,242 29,639,000 - 296,443,168
$ - $ 65,925,652 $ 33,039,000 $ - $ 297,671,873
$ - $ 11,819,511 $ 800,000 $ - $ 8,494,185
- 6,245,353 - - 544,139
- 50,793,636 - - (35,765)
- 855,000 - - 923,146
- 4,470,554 - - 4,968,257
- 5,184,430 - - (1,202,166)
$ - $ 79,368,485 $ 800,000 $ - $ 13,691,796
$ 12,606,893 $ 271,974,917 $ 61,540,857 $ 25,000,000 $ 450,690,554

EXPENDITURES
40 784 of 1111
Pension Long-Term Forecast
2024-25 2025-26 2026-27 2027-28
(In millions) ESTIMATES PROPOSED FORECAST FORECAST
Pension Contribution 1 - By Plan
Miscellaneous $ 11.8 $ 11.7 $ 12.4 $ 13.0
Safety $ 18.4 $ 19.7 $ 20.7 $ 21.5
Total $ 30.2 $ 31.4 $ 33.1 $ 34.4
Pension Contribution 1 - By Type
Normal Costs $ 7.4 $ 7.5 $ 7.6 $ 7.6
Unfunded Actuarial Liability (UAL) $ 22.8 $ 23.9 $ 25.5 $ 26.8 Total $ 30.2 $ 31.4 $ 33.1 $ 34.4
Actuarial Unfunded Liabilities
Miscellaneous $ 100.8 $ 98.9 $ 97.0 $ 94.3
Safety $ 199.1 $ 196.8 $ 193.0 $ 188.0
Total $ 299.9 $ 295.7 $ 290.1 $ 282.3
Funded Percentage
Miscellaneous 71% 72% 73% 75%
Safety 61% 62% 63% 65%
Total 65% 66% 67% 69%
Total Pension Contribution as % of Covered Payroll 3
Miscellaneous 30% 29% 30% 30%
Safety 102% 107% 109% 110%
Total 53% 53% 55% 55%
Pension Contribution as % of General Fund Expenditures 2 Miscellaneous 7% 7% 7% 7%
Safety 11% 12% 12% 12%
Total 18% 19% 19% 19%
1 This is the City's pension cost before accounting for employees' cost-sharing. 2 General Fund Expenditures only. Transfers out is not included. 3 Percentage increases for Safety plan are primarily due to the City's fire operations transferred to a new JPA agency in January 2019, resulting in less covered payroll but with the unfunded liabilities remaining as the City's responsibility.
41 785 of 1111
Pension Long-Term Forecast
2028-29 2029-30 2030-31 2031-32 2032-33 2033-34 2034-35

FORECAST FORECAST FORECAST FORECAST FORECAST FORECAST FORECAST $ 14.1 $ 14.4 $ 14.7 $ 14.4 $ 14.3 $ 13.7 $ 13.5
$ 23.0 $ 23.5 $ 23.9 $ 23.4 $ 23.2 $ 22.3 $ 21.9
$ 37.1 $ 37.9 $ 38.5 $ 37.7 $ 37.5 $ 36.0 $ 35.4
$ 7.7 $ 7.7 $ 7.8 $ 7.8 $ 7.8 $ 7.9 $ 7.9
$ 29.4 $ 30.2 $ 30.8 $ 29.9 $ 29.7 $ 28.2 $ 27.6
$ 37.1 $ 37.9 $ 38.5 $ 37.7 $ 37.5 $ 36.0 $ 35.4
$ 90.9 $ 86.1 $ 80.7 $ 74.7 $ 68.6 $ 62.3 $ 56.2
$ 181.7 $ 173.4 $ 163.9 $ 153.4 $ 142.7 $ 131.4 $ 120.2 $ 272.6 $ 259.5 $ 244.6 $ 228.1 $ 211.3 $ 193.6 $ 176.4 76% 78% 80% 82% 84% 86% 87%
66% 68% 70% 73% 75% 77% 79%
71% 72% 74% 77% 79% 81% 83%
32% 32% 32% 30% 29% 27% 26%
115% 114% 112% 107% 104% 97% 93%
58% 58% 57% 54% 52% 49% 47%
8% 8% 7% 7% 7% 7% 6%
12% 12% 12% 12% 11% 11% 10%
20% 20% 20% 19% 18% 17% 17%
42 786 of 1111
General Fund
43 787 of 1111
General Fund Summary

GENERAL FUND
2025-26

PROPOSED
BUDGET
Resources
Property Tax $ 89,352,000
Sales Tax - Local 1% 20,200,000
Sales Tax - Prop 172 400,000
Sales Tax - 1/4% Measure S 7,000,000
Property Transfer Tax 8,600,000
Transient Occupancy Tax 4,000,000
Business License Tax 8,000,000
Franchises 3,430,000
Golf Fees 3,343,500
Recreation Service Charges 4,801,000
Permits, Fees, and Fines 7,731,708
Intergovernmental 3,456,445
Interest and Miscellaneous 6,338,712
Transfers In - In Lieu Charges 5,070,896
Transfers In - Rent from Sewer Fund 1,800,000
Transfers In - Construction Services 530,000
Transfers In - Gas Tax 1,747,500
Current Resources $ 175,801,761
Use Unassigned Fund Balance $ 11,953,724
Total Resources $ 187,755,485
Expenditures by Department
City Attorney $ 1,362,187
City Clerk 1,097,892
City Council 563,805
City Manager 3,137,343
Community Development 2,082,117
Finance 4,396,466
Human Resources 2,766,970
Information Technology 5,245,027
Library 10,024,450
Parks and Recreation 23,519,690
Police 66,284,984
Public Works 10,016,465
Non-Departmental 6,121,556
Transfers Out 12,375,000
San Mateo Consolidated Fire Department Constribution and Fire Legacy Costs 38,761,533 Total Expenditures $ 187,755,485
Resources Over / (Under) Expenditures $ -
44 788 of 1111
General Fund Summary
*Department totals shown in millions.
*Citywide Administration includes these departments: City Attorney, City Clerk, City Council, City Manager, Finance, Human Resources, and Information Technology City Administration
$18.6 Community
Development
$2.1
Library
$10.0
Parks and
Recreation
$23.5
Police
$66.3
Public Works
$10.0
Non-Departmental
$6.1
Transfers Out
$12.4
San Mateo
Consolidated Fire
Department
Constribution and Fire
Legacy Costs
$38.8

GENERAL FUND

OPERATING BUDGET BY DEPARTMENT
2025-26 ($187.8 MILLION)
45 789 of 1111
General Fund 10-Year Forecast
2023-24

ACTUALS
2024-25

ESTIMATED

ACTUALS
2025-26

FORECAST
2026-27

FORECAST
2027-28

FORECAST

REVENUES
Property Tax $ 78,606,527 $ 84,000,000 $ 89,352,000 $ 91,017,000 $ 91,828,000 Sales Tax - Local 1% 20,543,116 20,500,000 20,200,000 20,402,000 20,810,000 Sales Tax - Prop 172 390,040 420,000 400,000 402,000 404,000 Sales Tax - 1/4% Measure S 6,839,831 7,000,000 7,000,000 7,070,000 7,211,000 Property Transfer Tax 8,634,762 14,000,000 8,600,000 8,600,000 8,600,000 Business License Tax 8,448,490 7,250,000 8,000,000 8,160,000 8,320,000 Transient Occupancy Tax 5,326,073 4,000,000 4,000,000 4,080,000 4,162,000 Franchises 3,403,374 3,350,000 3,430,000 3,460,000 3,490,000 Golf Fees 3,740,764 3,233,500 3,343,500 3,410,000 3,480,000 Recreation Service Charges 4,024,832 4,131,057 4,801,000 5,040,000 5,190,000 Permits, Fees, and Fines 9,448,804 7,702,786 7,731,708 8,100,000 8,340,000 Intergovernmental 3,066,664 3,368,551 3,456,445 3,600,000 3,670,000 Interest and Miscellaneous 11,086,174 5,950,000 6,338,712 7,400,000 6,875,000 Transfers In - In Lieu Charges 4,688,762 4,920,000 5,070,896 5,220,000 5,380,000 Transfers In - Rent from Sewer Fund 1,800,000 1,800,000 1,800,000 2,250,000 2,700,000 Transfers In - Construction Services 499,933 510,000 530,000 550,000 570,000 Transfers In - Gas Tax 1,747,500 1,747,500 1,747,500 1,747,500 1,747,500 TOTAL REVENUES $ 172,295,644 $ 173,883,394 $ 175,801,761 $ 180,508,500 $ 182,777,500

EXPENDITURES
Salaries and Wages $ 52,839,797 $ 56,635,169 $ 56,805,874 $ 58,510,000 $ 60,265,000 Benefits 21,035,521 23,512,566 23,835,672 23,990,000 24,110,000 Pension Unfunded Liability (UAL) 11,440,980 12,984,027 13,613,649 14,330,000 14,890,000 Non-Personnel Operating 37,047,757 40,995,412 42,363,757 44,705,000 46,005,000 SMC Fire and Legacy Costs 34,195,622 36,095,951 38,761,532 40,519,000 42,171,000 Transfers Out 15,683,288 14,100,000 12,375,000 9,742,900 9,741,300 Budget Savings - (4,000,000) (3,500,000) (4,000,000) (4,500,000) TOTAL EXPENDITURES $ 172,242,965 $ 180,323,125 $ 184,255,484 $ 187,796,900 $ 192,682,300 Resources Over / (Under) Requirements 52,680 (6,439,731) (8,453,723) (7,288,400) (9,904,800) Transfers Out to CIP Investment Reserve - - (25,000,000) - - Beginning Fund Balance $ 117,879,215 $ 117,931,895 $ 111,492,164 $ 78,038,442 $ 70,750,042 Ending Fund Balance $ 117,931,895 $ 111,492,164 $ 78,038,442 $ 70,750,042 $ 60,845,242 46 790 of 1111
General Fund 10-Year Forecast
2028-29

FORECAST
2029-30

FORECAST
2030-31

FORECAST
2031-32

FORECAST
2032-33

FORECAST
2033-34

FORECAST
2034-35

FORECAST
$ 97,964,000 $ 101,686,000 $ 101,634,000 $ 107,970,000 $ 114,854,000 $ 117,930,000 $ 123,550,000 21,226,000 21,651,000 22,084,000 22,526,000 22,977,000 23,437,000 23,906,000 408,000 412,000 416,000 420,000 424,000 428,000 432,000 7,355,000 7,502,000 7,652,000 7,805,000 7,961,000 8,120,000 8,282,000 8,600,000 8,600,000 8,600,000 8,600,000 8,600,000 8,600,000 8,600,000 8,490,000 8,660,000 8,830,000 9,010,000 9,190,000 9,370,000 9,560,000 4,245,000 4,330,000 4,417,000 4,505,000 4,595,000 4,687,000 4,781,000 3,520,000 3,560,000 3,600,000 3,640,000 3,680,000 3,720,000 3,760,000 3,550,000 3,620,000 3,690,000 3,760,000 3,840,000 3,920,000 3,998,400 5,350,000 5,510,000 5,680,000 5,850,000 6,030,000 6,210,000 6,400,000 8,590,000 8,850,000 9,120,000 9,390,000 9,670,000 9,960,000 10,260,000 3,740,000 3,810,000 3,890,000 3,970,000 4,050,000 4,130,000 4,210,000 6,350,000 6,000,000 4,500,000 4,500,000 4,500,000 4,500,000 4,500,000 5,540,000 5,710,000 5,880,000 6,060,000 6,240,000 6,430,000 6,620,000 2,700,000 2,700,000 2,700,000 2,700,000 2,700,000 2,700,000 2,700,000 590,000 610,000 630,000 650,000 670,000 690,000 710,000 1,747,500 1,747,500 1,747,500 1,747,500 1,747,500 1,747,500 1,747,500 $ 189,965,500 $ 194,958,500 $ 195,070,500 $ 203,103,500 $ 211,728,500 $ 216,579,500 $ 224,016,900 $ 62,073,000 $ 63,935,000 $ 65,853,000 $ 67,829,000 $ 69,864,000 $ 71,960,000 $ 74,119,000 24,830,000 25,570,000 26,340,000 27,130,000 27,950,000 28,780,000 29,650,000 16,210,000 16,440,000 16,620,000 16,150,000 16,020,000 15,150,000 14,800,000 47,093,000 48,210,000 49,359,000 50,541,000 51,756,000 53,004,000 54,289,000 44,204,000 45,811,000 47,081,000 47,993,000 49,089,000 49,890,000 50,956,000 9,743,100 9,843,100 9,841,300 9,890,550 9,891,800 10,136,800 10,139,550 (4,500,000) (4,500,000) (5,000,000) (5,000,000) (5,000,000) (5,000,000) (5,000,000) $ 199,653,100 $ 205,309,100 $ 210,094,300 $ 214,533,550 $ 219,570,800 $ 223,920,800 $ 228,953,550 (9,687,600) (10,350,600) (15,023,800) (11,430,050) (7,842,300) (7,341,300) (4,936,650) - - - - - - -
$ 60,845,242 $ 51,157,642 $ 40,807,042 $ 25,783,242 $ 14,353,192 $ 6,510,892 $ (830,408) $ 51,157,642 $ 40,807,042 $ 25,783,242 $ 14,353,192 $ 6,510,892 $ (830,408) $ (5,767,058) 47 791 of 1111
Revenueand Expenditure Assumptions
Revenues and expenditures in the Fiscal Year (FY) 2025-26 business plan and corresponding long-term financial plan are based on assumptions about the factors impacting each major revenue and expenditure category. For revenues, assumptions are largely based on economic or other conditions outside the City’s control. Assumptions for expenditures differ, however, in that in many cases, the assumptions are predominantly under the City’s control. A detailed discussion of the projection methodologies and major assumptions made for the FY 2025-26 business plan and corresponding long-term financial plan are discussed in detail below.

GENERAL FUND REVENUES
Revenue Estimation Methodology
All revenue assumptions and projections are reviewed and revised each fiscal year. Key elements that have an impact on major revenue sources are identified and analyzed to ensure that the projection methodology is as reliable as possible over the long term. Historical data trends indicate that significant swings in major revenues can occur due to economic cycles. Projecting revenues based on the high point of the economic cycle overstates the City’s financial position and could result in spending patterns that cannot be sustained. Conversely, projecting revenues from the lowest point of the economic cycle understates the long-term financial position of the City and can cause unnecessary service reductions.

Property Taxes
Property Tax is the largest source of General Fund revenue, comprising approximately 50% of the General Fund total revenues.

The property tax base in San Mateo has been very stable, declining only slightly during the Great Recession and pandemic.

However, due to the Federal Reserve’s monetary policy to control high inflation and the current economic uncertainty, we continue to live in a high-interest rate environment. High borrowing costs have a damper effect on the housing market, which in return hurts the City’s property tax revenue growth.

Property tax revenue is projected to be $89.4 million for fiscal year (FY) 2025-26, an increase of $5.4 million compared to $84.0 million estimated for FY 2024-25. This estimate is based on several key assumptions which we will discuss in detail. Of all, the most important factor this year is whether the State of California will backfill the FY 2023-24 property tax in-lieu of vehicle license fees (VLF) shortfall in FY 2025-26, including the City’s share of $6.6 million.

The City’s property tax revenue includes several main categories:
• Secured Property Tax is the tax on real property and the structures on that real property. • AB 26 Redevelopment Residual Revenues represent the City’s designated share of tax increment from the former redevelopment project areas that are in excess of the Successor Agency’s required obligated payments. These revenues are primarily from the secured tax base in the former redevelopment project areas. • AB 1290 Redevelopment Pass-through funds represent the City of San Mateo’s General Fund share of the AB 1290 passthrough payments made to taxing entities based on the tax increment funds used by Successor Agency to pay remaining debt obligations. Similar to the AB 26 funds, these revenues are primarily from the secured tax base in the former redevelopment project areas.
• Educational Revenue Augmentation Fund (ERAF) is a mechanism used by the State to shift funding from local property tax dollars to public schools. When local property tax dollars shifted into ERAF exceed what is necessary to fund the schools, those excess funds are returned to the local taxing entities via Excess ERAF revenue. San Mateo is one of the five counties in the State where Excess ERAF is generated.
48 792 of 1111
Revenueand Expenditure Assumptions
• Property Tax in Lieu of VLF represents the swap of vehicle license fees (VLF) for property tax as part of a state-local budget agreement in 2004. The agreement permanently reduced the VLF tax rate from 2% to 0.65%, and the revenue loss was replaced with a like amount from property tax. After FY 2004-05 base year, property tax in lieu of VLF increases annually in proportion to the growth in assessed valuation. Property tax in lieu of VLF has two funding sources: property taxes from non-basic aid school districts, and ERAF that would otherwise go to non-basic aid school districts. • Unsecured Property Tax represents the tax on appurtenances such as furniture, machinery, and equipment. • Supplemental Property Tax is the result of reassessing the value of real property when there is a change of ownership or new construction is completed after the official lien date. • Unitary Property Tax is assessed on property owned by utilities, such as power lines, cable, etc. • Homeowners’ Property Tax Relief revenues are reimbursements from the State for revenues lost due to the homeowners’ property tax exemption on the first $7,000 of assessed value of their principal place of residence.

Secured Property Tax Assumption:

Secured property tax constitutes over 60% of total property tax revenues and is projected to grow roughly 4% in the upcoming FY 2025-26. The increase reflects the change in assessed value (AV) based on the County Assessor’s Office estimated property tax roll. While the average annual growth in AV over the past 10 years has been around 7% indicating strong demand in our region, we have experienced a slowdown in the housing market reflected in both real estate sales volume and prices. In the long-term plan, a conservative growth estimate of 4% is utilized for the first five years and a more optimistic growth estimate of 5% is used for the second five years of the plan. These assumptions factor in historic growth rates and the current economic environment.

Property Tax In-Lieu of Vehicle License Fees (VLF) Assumption:

As discussed above, in 2004, as a part of the budget deal with the State of California, the vehicle license fee rate was reduced from

2.0% to 0.65%. To offset the onerous financial impact to local governments, the State backfilled the reduction of vehicle license fees with property tax, which is known as property tax in-lieu of vehicle license fees (VLF). The primary caveat being that the funding source for the VLF is property tax and ERAF from non-basic aid school districts, which are school districts that are not able to meet their State-determined minimum funding level (as defined by Proposition 98) through property taxes. The funding mechanic is that the counties and cities use the property tax and ERAF from non-basic aid school districts to fund VLF, then the school districts get funding backfilled by the State General Fund.

In San Mateo County, due to decreases in student enrollment and increases in property taxes, more and more school districts have switched to basic-aid status, meaning local property taxes are sufficient to meet the schools’ State minimum funding level.

Currently, 18 of the 23 school districts in San Mateo County are basic-aid school districts, leaving only five non-basic aid school districts. As such, property tax and ERAF from these limited non-basic-aid schools are not enough to fulfill the VLF revenues obligated to the county and local cities, creating the chronic VLF shortfall issue.

To date, San Mateo County is one of only three counties in the State of California that has had VLF shortfalls. At present, the only recourse to be made whole for the VLF shortfall is to file a claim with the State for it to consider as a part of its budget deliberations in the subsequent fiscal year. In the last few years, the State has reimbursed counties and cities for their VLF shortfalls through its annual budget process. However, as the county-wide VLF shortfalls continue to widen, the State’s willingness to fund this obligation may diminish, particularly during fiscal years when the State experiences significant deficits. The most recent State budget estimates a $12 billion deficit.
49 793 of 1111
Revenueand Expenditure Assumptions
In FY 2023-24, the county-wide VLF shortfall was $114 million, and the City’s share of the VLF shortfall was $6.6 million. Despite the collective efforts from San Mateo County and each local city within the County to contact state representatives to address the FY 2023-24 VLF shortfall, the State has not yet included VLF backfill funding in its FY 2025-26 proposed budget (May revision). San Mateo County and the cities will continue to fight for the VLF revenues. The next step, if the State adopts its FY 2025-26 budget without VLF backfill, is to advocate through our state representatives to include the VLF funding in the State’s budget amendments.

The VLF shortfalls have become a major threat to our financial sustainability. San Mateo County projects that, over the next 7-8 years, at least three more of the remaining non-basic aid school districts will shift to basic-aid status. As such, the county-wide VLF shortfall will grow exponentially, from the shortfall of $114 million for FY 2023-24 to over $300 million by FY 2031-32. The City’s share of the county-wide VLF shortfall is about 6%. If the County lost three more non-basic aid schools in 7-8 years, the City’s VLF shortfall will grow to approximately $19 million by FY 2031-32. Therefore, it is imperative for the county and cities in San Mateo County to continue advocating for the VLF revenue, as losing State funding on VLF shortfalls will severely impact to the City’s financial health and this funding should remain local as it is tax revenue remitted from property owners within the City and County.

For the next fiscal year, our assumption is that the State will fully fund its VLF obligations. In the 10-year forecast, we use a middleground assumption, assuming the County and cities will eventually find a permanent fix for the VLF issue, and this revenue will become stable.

Other Assumptions:

Excess ERAF Funds continue to be a steady, yet somewhat uncertain, revenue source for the General Fund. The long-term plan anticipates the continued receipt of Excess ERAF revenues annually. Excess ERAF is projected to be $8.4 million in 2025-26. There have been legislative efforts to increase the Local Control Funding Formula (LCFF),which would ultimately increase funding for public school districts and decrease the amount of Excess ERAF that is available. Conversely, these efforts to increase the LCFF would likely shift more school districts into non-basic aid status and somewhat address the VLF shortfall issue, but it is difficult to quantify the impact until impartial analysis has been completed by the Legislative Analyst’s Office (LAO).

AB 26 Redevelopment Residual Revenues: Baseline revenue amount is projected to be $6.0 million for FY 2025-26 and is expected to grow at the same rate annually as the secured tax projection. Per Council direction, 20% of this residual revenue should be reserved annually in a housing set-aside in the General Fund. Policy H1.2 of the City’s Housing Element also calls for the City to contribute 20% of the AB26 redevelopment residual revenue to the housing set-aside, which the City can use for affordable housing developments. As a result, in the FY 2025-26 budget, $1.0 million has been added to the housing set-aside reserve.

AB 1290 Redevelopment Pass-through: These funds continue to grow slightly and are estimated to grow 4% over the long-term forecast.

Other property tax components, including unsecured, supplemental secured, and unitary property tax revenues, as well as Homeowners’ Property Tax Relief revenues, are expected to remain flat due to the nature of the revenue source.

Background Information:

The Successor Agency to the Redevelopment Agency of the City of San Mateo is responsible for payment of the remaining recognized obligations, which include tax allocation refunding bonds (TAB). The last debt service payment for the Series 2015A TAB will occur in fiscal year 2032-33, which is the trigger event for the dissolution of the former Redevelopment Agency of the City of San Mateo. Beginning in fiscal year 2033-34, rather than receive AB 26 and AB 1290 property tax revenues, the taxing entities, which includes the City, will receive the full property tax increment, as all of the recognized obligations will be satisfied. As such, the City will need to address this change in advance to determine if it wants to continue contributing to the housing set-aside, as the AB 26 property tax revenue source will no longer exist beginning in fiscal year 2033-34. 50 794 of 1111
Revenueand Expenditure Assumptions
Sales Tax
Sales tax revenue is currently the second largest single revenue source of the General Fund. It has been a stable revenue source for the City and is projected to stay flat with only moderate 1-2% annual growth.

It is worthwhile to note that the City’s share of the local 1% sales tax from internet sales is allocated through the County pool based on the City’s proportionate share of locally generated sales tax. There have been several legislative efforts to allocate internet sales tax based on point of delivery, which would serve the City well, but not enough political will to properly address the issue.

The FY 2025-26 budget assumes Local 1% sales tax revenues (Bradley Burns) of $20.2 million and local 1/4% sales tax revenues (Measure S) of $7.0 million. Slow and steady growth is anticipated for sales tax throughout the long-term financial plan.

Property Transfer Tax
The City collects a real property transfer tax (RPTT) upon the sale or transfer of any property within the City boundaries. As a charter city, San Mateo voters approved a 0.5% real property transfer tax (RPTT) rate. Furthermore, in November 2022, San Mateo voters approved Measure CC that increased the RPTT rate to 1.5% for properties sold or transferred with a value of $10 million or more.

This revenue source is extremely volatile, since it is driven by both property values and transaction volume, which can vary significantly, even during periods of relatively stable economic growth. During the Great Recession, RPTT dropped 70% from $10 million to $3 million over a two-year period and took six years to climb back up to the $10-million-dollar level. In 2018-19, RPTT reached a record-high $14.0 million, but only one year later dropped nearly 30% to $9 million in 2019-20 due to COVID pandemic.

Following the pandemic, RPTT rebounded quickly and reached $14.3 million in 2021-22, then dropped again to $7.1 million one year later due to the rise of mortgage interest rates which negatively impact the real property sales value and transaction volume.

RPTT is anticipated to be almost $14.0 million for FY 2024-25, partly due to the addition of the Measure CC revenues. These examples, though, showcase how volatile this revenue source can be.

Rather than try to determine the year-over-year trend, the General Fund Long-Term Plan uses an average of $8.6 million, including in fiscal year 2025-26. Finance staff will continue to monitor market trends at the local and national level and adjust assumptions accordingly.

Transient Occupancy Tax
Transient Occupancy Tax (TOT) is dependent on both the occupancy levels and room rates of the City’s hotel stock. TOT revenue is very sensitive to broader economic trends. In good economic times, both occupancy rates and room rates increase, but during recessionary periods, both go down, which can result in a significant reduction in TOT revenue. In the City of San Mateo, the existing hotel stock primarily serves business travelers flying into and out of the San Francisco International Airport.

TOT revenue suffered the most during the pandemic and was just about to return in FY 24-25 to the $7.0 million pre-pandemic baseline, when a major hotel within the City shut down. Given this, the new baseline for TOT is estimated at $4.0 million and is used in FY 2025-26 projections and in the long-term financial plan.

Business License Tax
The City of San Mateo Municipal Code requires all persons or businesses doing business in the City of San Mateo to pay an annual business tax, which is also referred to as a business license. The payment of this tax is required prior to the commencement of business in San Mateo. Depending on the type of business, the business license tax is either a flat fee or is based on gross receipts.

Business license tax revenues have seen steady growth over the past decade. This revenue resource is projected to be $8 million in FY 25-26, then grow at a modest 2% annually in the long-term financial plan. 51 795 of 1111
Revenueand Expenditure Assumptions
Franchise Fees
The City receives franchise payments from companies providing garbage, electricity, gas, and cable television services. Small growth is expected from this revenue source, 1% annually in the forecast. This revenue source will continue to be carefully monitored, with future growth projections adjusted accordingly. Overall, franchise fee revenues are projected to be just over $3.4 million in 2025-26.

Golf Fees
Golf fee revenues primarily come from rounds of golf played, but other sources include driving range revenue and merchandise sales. The City’s golf course continues to perform well in the post-pandemic period. The budget projection is set at $3.3 million for FY 2025-26, with a moderate 2% annual growth in the long-term financial plan.

Recreation Service Charges
Recreation service charges include the revenue collected from the various recreation programs that are run by the Parks and Recreation Department, including camps, youth and adult programs, picnic and recreation center rentals, and lagoon use fees. For FY 2025-26, total revenues from recreation service, including grants, are projected to be $4.8 million, with a 3% annual increase in the ten-year long-term forecast.

Permits, Fees, and Fines
The City receives permit, fee, and fine revenues from a number of sources across departments, including parking and trafficrelated citations (Police) and encroachment permits (Public Works). In FY 2021-22, the Downtown Parking Fund was merged into the General Fund. As such, parking revenues are now reported under this revenue category in the General Fund. In total, General Fund’s permit, fee, and fine revenues are projected to be $7.7 million for FY 2025-26 then grow by 3% annually in the long-term financial plan.

Intergovernmental
Intergovernmental revenues are predominantly grants or reimbursements from other governmental agencies, including other cities, the county, the state, and the federal government. Because this revenue category consists predominantly of grants and reimbursements, many of which are one-time funds, revenues can fluctuate annually. Additionally, the City has an agreement with the San Mateo Consolidated Fire Department (SMC Fire) to provide Human Resources and Finance services. Reimbursement from SMC Fire is recorded here under Intergovernmental revenues. For FY 2025-26, this revenue is projected to be $3.5 million with 2% modest growth in the ten-year forecast.

Interest and Miscellaneous
This revenue category includes interest earnings on the City’s investment portfolio and other smaller revenues not attached to other categories. Budget projections for investment earnings are on a cash basis to avoid fluctuations due to mark-to-market accounting adjustment on the City’s investment portfolio. In total, this category of revenues is expected to generate approximately $6.3 million in FY 2025-26, mostly due to strong investment returns.

In-Lieu Charges
In-lieu charges are funds transferred into the General Fund from other funds to cover the cost of City-wide administration. These costs include covering a portion of expenditures related to the operation of the City Manager’s Office, City Attorney’s Office, City Clerk, Finance, Human Resources, and Information Technology. It also covers costs such as the other funds’ share of general liability expenses. A total of approximately $5.1 million is projected in FY 2025-26. 52 796 of 1111
Revenueand Expenditure Assumptions
In-lieu charges are set to grow at a rate of 3% annually in the ten-year forecast. The increase is largely due to increases in the costs of providing administrative services. In accordance with the best practices, the City’s cost allocation study was last updated in FY 2020-21, and it is expected that the study will be maintained and updated on a regular basis.

Transfers In – Gas Tax
The Gas Tax Fund is set to transfer $1.7 million annually to the General Fund in the long-term forecast to cover a portion of street maintenance costs within the Public Works Department. This transfer has been set at a flat amount annually, which means over time it will provide less and less funding in terms of real dollars. While the allocation of $1.7 million was increased in FY 2018-19 from the historical transfer of $1.5 million, a new allocation is not currently expected given the demand for Gas Tax dollars. The cost of street maintenance along with the revenues from Gas Tax funding will be monitored and future transfers will be adjusted accordingly.

GENERAL FUND EXPENDITURES
Expenditure Estimation Methodology
Similar to the revenue assumptions, expenditure assumptions and projections are reviewed and revised each fiscal year. Unlike revenues, especially tax revenues, General Fund expenditures are largely under the control of the City. As such, assumptions for expenditure growth are generally able to be aligned with revenue growth where possible. In cases where an expenditure category is not under control of the City, as is the case for CalPERS pension contributions, the projected increases are treated as nondiscretionary and take precedence in terms of the allocation of resources, limiting the City’s flexibility to prioritize where funds are expended. Assumptions for each of the General Fund’s expenditure categories are discussed in detail below.

Personnel Costs
Personnel costs, including the City’s share of SMC Fire’s personnel costs, represent over 70% of total General Fund expenditures.

The General Fund is projected to allocate $94.3 million for personnel costs in FY 2025-26. To best reflect the personnel costs, the General Fund ten-year forecast splits costs into three categories: salaries, benefits, and payment on the unfunded pension liability.

This allows assumptions for cost increases in the three categories to move independently from one another. Assumptions for the major categories of personnel expenditures are discussed in the detail below.

Increases for salaries and salary-related costs, such as overtime, are initially based on existing labor contractual agreements or assumptions about the outcome of ongoing and future negotiations. Beyond those contractual assumptions, salary increases are set in the ten-year forecast based on projected modest salary increases, which generally aligns with our long-term CPI projections, throughout the forecast. It is important to note that these are only projections of possible salary increases and do not reflect the actual salary adjustments that will be made in the future. There are several factors that have to be considered related to salary increases in the future, including the City’s economic condition, the amount of unassigned fund balance in the General Fund, labor negotiations, and our ability to compete in the market for employees.

As previously discussed, the cost of CalPERS pension contributions is not something the City has control over the way it does over many other expenditures. As a result, the ten-year forecast contains projected increases in the City’s contribution rates that were developed based on the latest CalPERS actuarial valuation and projection. These contribution rates, which have been adjusted to consider the employees’ share of the City’s contribution rates, factor in assumptions related to turnover of City employees and the fact that new employees will come in under lower pension formulas. The rates also factor in the most up-to-date information available about the economic and actuarial changes CalPERS has recently implemented, as well as updated investment return results.
53 797 of 1111
Revenueand Expenditure Assumptions
The City’s pension contribution increased significantly starting in fiscal year 2024-25 due to the CalPERS investment loss of negative 6.1% in FY 2021-22. Such investment loss will cost the City over $100 million in additional pension costs over the 20-year amortization period. As a result, the City started paying about $6 million more in FY 2024-25 than FY 2023-24 and will be required to pay an additional $1-2 million annually during the rest of the five-year ramp-up period (FY 2025-26 through FY 2028-29). Once the five-year ramping has been completed, the overall increase in pension contributions is projected to be an additional $5 million over the pension contribution for FY 2023-24 for several years before gradually decreasing.

FISCAL YEAR

GENERAL FUND

NORMAL COSTS
(in millions)

GENERAL FUND

PAYMENT ON

UNFUNDED LIABILITY
(in millions)

GENERAL FUND
TOTAL
(in millions)

PERCENTAGE

OF TOTAL GENERAL

FUND OPERATING
EXPENDITURES*
2024-25 $ 5.8 $ 19.4 $ 25.2 15%
2025-26 5.9 20.5 26.4 15%
2026-27 6.0 21.6 27.6 16%
2027-28 6.0 22.4 28.4 16%
2028-29 6.0 24.3 30.3 17%
2029-30 6.0 24.7 30.7 16%
2030-31 6.1 25.0 31.1 16%
2031-32 6.1 $24.3 30.4 15%
2032-33 6.1 24.1 30.2 15%
2033-34 6.1 22.9 29.0 14%
Source of Information: CalPERS Pension Outlook
*Total operating expenditures exclude transfers out.

In FY 2022-23, CalPERS had an investment gain of 5.8% and although this fell short of its long-term investment of return goal of

6.8%, it did not significantly affect pension contributions in FY 2025-26. However, if CalPERS investment returns continue to fall short of the long-term investment goal, it will create another layer of unfunded pension liability to the City. The General Fund Long-Term Plan assumes that CalPERS will meet its target rate of return (discount rate) for the remainder of the ten-year forecast.

Background Information:

Payment on the unfunded pension liability includes the payment for fire employees that have transferred to SMC Fire, as those costs correspond to the years of service that the fire employees had worked for the City and remain the City’s responsibility even after transfer of operations. In the ten-year financial plan, fire’s portion of the unfunded pension liability is included as part of fire legacy costs. More detail on this is discussed below in the subsection for San Mateo Consolidated Fire Department Contribution and Fire Legacy Costs.

Other major costs in this category include medical, dental, and vision premiums paid by the City; Medicare and Social Security taxes; workers’ compensation; and deferred compensation. Medical insurance, which is the second-largest cost in this category, is set in the forecast to increase at 6.5% for the duration of the long-term plan. These assumptions are based on historical trends and assumptions used by the consulting actuary in the valuation of the City’s retiree medical plan. For other benefit costs that move with salary increases, such as Medicare and Social Security taxes, those are set to increase at the same rate as salaries in the ten-year financial plan.
54 798 of 1111
Revenueand Expenditure Assumptions
Non-Personnel Costs
The remaining General Fund’s expenditures consist of non-personnel costs. For the ten-year forecast, non-personnel expenditures were broken down into distinct categories: operating, transfers out, and the annual contribution to the San Mateo Consolidated Fire Department and fire legacy costs. A brief description of the types of expenditures in each category is provided below.

OPERATING EXPENDITURES
Operating expenditures, which total $42.4 million in FY 2025-26, include spending on a wide variety of expenditure categories related to operations of the City. Some of the major expenditure categories include professional and contract services, general liability insurance, utilities costs, and capital outlay.

Professional and contract services in this category total about $11.8 million in FY 2025-26 and it covers a wide variety of service areas, such as engineering services, legal services, the annual financial audit, consultants for special studies, animal control, and the maintenance of street and park trees. Because expenditures in this category are largely within the City’s control, the long-term forecast reflects an annual increase of 2-3%.

General liability insurance is another major expenditure category which has grown exponentially in the last few years. The budget for FY 2025-26 is $4.4 million and expenditures are expected to keep growing significantly over the 10-year forecast, with 5% increases in insurance premiums assumed for the majority of the forecast years.

Utilities costs, which total $4.5 million in FY 2025-26, include gas, electricity, water, and telecommunications costs required for city operations. Of the total, over 55% goes toward gas and electricity, 25% goes toward water, and the remaining 15% is for telecommunications. For the ten-year forecast, the annual inflationary increase is set at 2%. These increases consider expected growth in costs, which are largely beyond the City’s control, although increased conservation efforts can help control expenditure growth in this area.

The capital outlay expenditures include a "rental rate" charged to departments to cover the cost of replacing vehicles and equipment through the Vehicle and Equipment Replacement Fund. Funds are accumulated while the vehicle or equipment is still in use, ensuring sufficient resources are available for replacements. The budget for this category is $1.57 million for FY 2025-26.

For more information about the Vehicle and Equipment Replacement Fund and its long-term financial plan, please refer to the Fund Information section of this budget document.

TRANSFERS OUT
This category of funding includes the transfers the General Fund makes to various funds to fund ongoing and one-time needs.

Ongoing transfers are programed in the long-term forecast.

In the proposed FY 2025-26 budget, transfers out is projected to be $12.375 million, comprising of the following:
• $8.925 million contributions to Capital Improvement Plan (CIP), of which $3 million is from Measure S and $0.875 million is from Measure CC;
• $2.7 million from Measure S for debt service related to the 2020A Revenue Bonds issued for flood control and street rehabilitation improvements;
• $0.41 million annual contribution to the Vehicle and Equipment Replacement Fund for major building component replacement; and
• $0.35 million to replenish the 2% Hotel Tax Fund’s fund balance to meet debt service requirements. 55 799 of 1111
Revenueand Expenditure Assumptions

SAN MATEO CONSOLIDATED FIRE DEPARTMENT CONTRIBUTION AND FIRE LEGACY COSTS On January 13, 2019, the City’s fire operations were transferred to the San Mateo Consolidated Fire Department (SMC Fire), a Joint Powers Authority (JPA), for fire, rescue, and emergency services between the cities of Belmont, Foster City, and San Mateo.

Pursuant to the JPA, SMC Fire costs are split 20% Belmont, 20% Foster City, and 60% San Mateo.

The City’s share of SMC Fire costs is projected to be $31.05 million for FY 2025-26. Additionally, there are legacy costs that remain with the City, which are costs that were incurred during the time that the fire employees had worked for the City. These legacy costs include the unfunded pension liability, workers’ compensation liability, and retiree health benefit liability. Factoring in the legacy costs that remain with the City, the total cost to the City’s General Fund for fire service for FY 2025-26 is $38.8 million.

The long-term forecast presents the City’s contribution to SMC Fire and its fire legacy costs in a separate line to provide greater transparency and better projection of costs. The legacy costs are based on the consulting actuary’s projections. The City’s 60% contributions were based on the SMC Fire budget and five-year forecast. Beyond that, a 4% increase has been projected for the first five years of the 10-year plan and a 3% annual growth has been projected for the remaining.

BUDGET SAVINGS
The budget savings amount represents expenditure reductions and/or revenues exceeding expectations. Including this adjustment in the General Fund long-term forecast presents a more realistic view of the General Fund’s financial position.

TRANSFERS OUT TO CIP INVESTMENT RESERVE
The City Council approved staff’s recommendation to set aside some of the unassigned fund balance of the General Fund into a Capital Improvement Investment Reserve per the new Capital Investment Reserve Policy included in the Appendix section of the budget document. The Capital Investment Reserve set aside is $25 million starting in FY 2025-26.

LONG-TERM FINANCIAL FORECAST
The long-term financial forecast includes all known and assumed resource demands. This provides a comprehensive view of the demand for the City’s resources and allows Council to prioritize how those resources should be allocated. The long-term forecast allows the City to foresee structural imbalance, and plan to position itself towards long-term financial sustainability. 56 800 of 1111
Departments
57 801 of 1111
Departments by Fund

FUND NAME CITY

ATTORNEY
CITY
CLERK
CITY

COUNCIL
CITY

MANAGER'S
OFFICE

COMMUNITY

DEVELOPMENT
General Funds
General X X X X X
Measure S Tracking
Housing Set-Aside X
Downtown Services
Recreation Services
Golf
Special Revenue Funds
Police Grants and Safety
Solid Waste X
HOME X
Community Development Block Grant X
Advance Planning X X
Construction Services X X X
City Housing X
Low and Moderate Income Housing Asset X
Parks and Recreation Revenue
Commercial Linkage Fee
Permanent Local Housing Allocation X
Landfill
Debt Service Funds
Street and Flood Control Projects Bond
General Obligation Bonds
2% Hotel Tax
Enterprise Funds
Sewer X x
Storm
Internal Service Funds
Vehicle and Equipment Replacement
Fleet and Building Maintenance
Benefits
Dental
Workers’ Compensation
Comprehensive Liability X
58 802 of 1111
Departments by Fund

FINANCE HUMAN

RESOURCES

INFORMATION

TECHNOLOGY LIBRARY PARKS AND RECREATION POLICE PUBLIC WORKS NONDEPARTMENTAL

X X X X X X X X
X X X
X X
X
X X
X
X X
X X

X X X X
X
X
X
X
X
X

X X X X
X
X
X
X
X
X
59 803 of 1111
City Attorney
60 804 of 1111
City Attorney
Mission Statement
The mission of the City Attorney’s Office is to provide excellent, clear legal advice and zealous, ethical legal representation for the City Council, City officers, and City staff to support them in their efforts to make San Mateo a community of the highest quality. The Office staff will be accessible to those they serve and respond to requests for service in a timely manner.

Services and Structure
Legal Counsel
The City Attorney’s Office is responsible for providing legal advice to the City Council, City staff, and City boards or commissions on matters that affect the conduct of City business; and for preparing contracts, ordinances, resolutions, and related legal documents to implement adopted City policy. The City Attorney’s Office also provides, either directly or through outside counsel, for the representation of the City in administrative proceedings and in court proceedings initiated by the City.

Litigation Defense
The City Attorney’s Office is responsible for providing, either directly or through outside counsel, for the defense of the City, its officers, and its employees against lawsuits and claims. The Office procures property and general liability insurance, contracts for claims adjusting services, and oversees the handling of Tort Claims. The City receives approximately 67 claims yearly, including claims for personal injury and property damage. 61 805 of 1111
FINANCIALS 2021-22

ACTUALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 1,521,063 $ 1,653,253
Operating 4,122,800 5,222,800
Indirect & Overhead 65,073 66,977
Total Expenditures $ 5,708,936 $ 6,943,031
Funding Sources
General Funds $ 1,332,870 $ 1,362,187
Special Revenue Funds 229,249 278,376
Enterprise Funds 109,024 118,038
Internal Service Funds 4,037,793 5,184,430
Total Funding Sources $ 5,708,936 $ 6,943,031

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
City Attorney 1.00 1.00
Assistant City Attorney 3.00 2.00
Executive Secretary to City Attorney 1.00 1.00
Senior Assistant City Attorney - 1.00
Total Merit 5.00 5.00
Total Per Diem - -
Total Positions 5.00 5.00
City Attorney
62 806 of 1111
City Clerk
63 807 of 1111
City Clerk
Mission Statement
The office of the City Clerk assists residents in navigating the City’s governance structure; provides access to local government decision-makers; is the compliance filing officer; is the City’s elections official; and ensures transparent processes and access to the City’s records.

Services and Structure
The Clerk’s office provides the following services:
• Oversight of the City Council legislative processes, including compliance with the Brown Act. • Coordination of recruitments for the City’s Boards and Commissions. • Preservation of the City’s official records and oversight of the City’s records management program. • Research and retrieval of records for the public and staff. • Maintenance of the City Charter and codification of the Municipal Code. • Management of agreements, contracts, and deeds.
• Coordination and execution of municipal elections.
• Act as the City’s compliance filing officer for the Political Reform Act and Public Records Act. • Administrative support to the City Council.
• Manages special relationships such as Sister City and Adopted Unit program. 64 808 of 1111

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 828,307 $ 997,777
Operating 448,932 89,492
Indirect & Overhead 10,623 10,623
Total Expenditures $ 1,287,862 $ 1,097,892
Funding Sources
General Funds $ 1,287,862 $ 1,097,892
Total Funding Sources $ 1,287,862 $ 1,097,892

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
City Clerk 1.00 1.00
Asistant to City Clerk 1.63 1.63
Deputy City Clerk 1.00 1.00
Management Analyst I/II 1.00 1.00
Total Merit 4.63 4.63
Total Per Diem 0.25 0.25
Total Positions 4.88 4.88
City Clerk
65 809 of 1111
City Clerk

METRICS
Public Transparency and Compliance
We provide public access to legislative decision-making and government records.

Number of Public Records Act (PRA) requests received
Percent of PRA responses responded to within prescribed timelines Percent of Fair Political Practices Commission (FPPC) compliances documents filed on time Percent of minutes completed and published on next regular meeting agenda Legislative Process
We ensure that the City’s legislative decisions are smoothly and timely completed.

Number of contracts processed annually
Number of agendas developed for public meetings
Records Management
We are committed to protecting the City’s official public records.

Number of official records added to City’s electronic document management system.

Informational Metrics
Number of Statement of Economic Interest Forms filed
66 810 of 1111
City Clerk
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Workload 1,500 1,700 1,900 2,100
Performance 100% 100% 100% 100%
Performance 89% 99% 99% 99%
Performance 75% 85% 95% 90%
Workload 133 150 150 150
Workload 50 50 50 50
Workload 1,922 2,200 2,500 2,800
Workload 190 170 170 170
67 811 of 1111
City Council
68 812 of 1111
City Council
Mission Statement
The City Council’s mission is to protect, maintain, and improve the quality of life for San Mateo residents and visitors by adopting legislation, providing policy direction for the City’s administration, and by promoting the best interests of the community locally and with other governmental agencies.

Services and Structure
The City Council is comprised of five members. Commencing with the November 2022 election, San Mateo began its transition to by-district election, with three members elected from Districts 1, 3 and 5. The City's transition to by-district elections was completed following the November 2024 election, where two at-large seats expired and Districts 2 and 4 held their first district elections. General municipal elections are held every even numbered year, with two Council Members elected the year preceding Leap Year and three elected the year after Leap Year. Council Members hold office for four-year terms commencing the first regular council meeting in December following the November election. The Council Members select from among themselves a Mayor and Deputy Mayor to serve for one-year terms. The Council sets policy for the City, enacts ordinances, approves the budget, and authorizes City expenditures.

The Office of the City Council focuses on the following areas: the formulation of City policies which reflect the needs, wishes, and priorities of the residents of San Mateo; the promotion of economic, cultural, and governmental well-being of the community. To assure that residents and visitors are kept informed of municipal activities and events; and to establish and maintain cooperative, effective relationships and communications with local, state, and federal agencies to influence policy decisions, legislation, and services that affect the City of San Mateo. 69 813 of 1111

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 131,335 $ 133,099
Operating 311,735 417,256
Indirect & Overhead 13,450 13,450
Total Expenditures $ 456,520 $ 563,805
Funding Sources
General Funds $ 456,520 $ 563,805
Total Funding Sources $ 456,520 $ 563,805

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
City Council Member 5.00 5.00
Total Merit 5.00 5.00
Total Per Diem - -
Total Positions 5.00 5.00
City Council
70 814 of 1111
City Manager's
Office
71 815 of 1111
City Manager's Office
Mission Statement
The City Manager’s Office provides leadership, support, and coordination for City departments; provides policy recommendations to the City Council and implements Council policies and actions; represents City interests in local and regional issues; and oversees key program areas of a Citywide nature.

Services and Structure
The City Manager’s Office includes the following program areas:

City Management
Providing Citywide leadership and coordination to the organization and policy development support for the City Council.

Representing the City’s interests in local and regional issues, and ensuring diversity, equity, and inclusion (DEI) initiatives are integrated into our work citywide.

Economic Development
Supporting the economic vitality of the City through development opportunities, permitting support, business outreach and retention, marketing, and liaison work with economic development stakeholders and partner organizations.

Communications
Developing and implementing Citywide communications and community engagement activities and tools and serving as a resource for other departments. Managing the content, navigation, and design of the City’s website and social media channels.

Sustainability
Developing and implementing Citywide sustainability activities in support of Climate Action Plan and serving as a liaison to the Sustainability Commission.

Volunteer Engagement
Coordinating volunteer engagement opportunities with City departments and encouraging greater community involvement with special events and neighborhood activities.
72 816 of 1111

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 2,436,809 $ 2,496,062
Operating 955,600 1,195,600
Indirect & Overhead 17,782 18,189
Total Expenditures $ 3,410,191 $ 3,709,851
Funding Sources
General Funds $ 2,845,299 $ 3,137,342
Special Revenue Funds 476,182 481,671
Enterprise Funds 88,710 90,837
Total Funding Sources $ 3,410,191 $ 3,709,851

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
City Manager 1.00 1.00
Assistant City Manager 1.00 1.00
Communications Manager 1.00 1.00
Communications & Engagement Coordinator I/II 1.00 1.00
Economic Development Manager 1.00 1.00
Executive Secretary to City Manager 1.00 1.00
Management Analyst I/II 1.00 1.00
Sr. Management Analyst 1.00 1.00
Sustainability Analyst 1.00 1.00
Total Merit 9.00 9.00
Total Per Diem 0.48 0.48
Total Positions 9.48 9.48
City Manager's Office
73 817 of 1111
City Manager's Office

METRICS
Economic Development
Business assistance provided
Communications
Number of citywide eNewsletter subscribers
Volunteer Engagement
Number of volunteers and volunteer hours
74 818 of 1111
City Manager's Office
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Workload 150 160 175 175
Performance 12,508 12,600 13,000 13,500
Workload 4,358 vols 3,000 vols 4,000 vols 4,500 vols
33,658 hrs 27,000 hrs 35,000 hrs 35,000 hrs
75 819 of 1111
Community
Development
76 820 of 1111
Mission Statement
To ensure a quality-built environment and healthy
neighborhoods that contribute to a strong economic base in the City of San Mateo; to be responsive to the community and respected by it; and to provide outstanding customer service.

Services and Structure
The Community Development Department (CDD) has broad
responsibilities, including long-range planning, review of applications for new development, administration of
the City’s General Plan, Zoning Code and the California Building Code, implementation of the City’s housing
programs, and maintenance of neighborhoods. Five
divisions work together to accomplish these goals: Building, Code Enforcement, Housing, Planning, and Business and
Admin Services. The department provides staff support and services to three standing commissions and committees,
including the Planning Commission, Community Relations
Commission, and Civic Arts Committee, and works with
numerous outside agencies, community groups and
homeowner associations.

Building Division
The Building Division manages programs and services
related to building permit plan review and inspection of buildings and structures to ensure a safe, accessible,
sustainable, and energy-efficient environment throughout our community. The division regulates local and state
laws related to building construction, maintenance, use, repair, and habitation. This includes the enforcement of the established health and safety codes, building codes, and standards.

The division is organized into three work units: the
permit center (City Hall public counter), plan review, and construction inspection. These units offer customers permit and property information, technical code review, permit issuance, and inspection services
Its mission includes customer service and public education to enhance the safety of existing buildings and to provide more public awareness of codes. In the event of an
emergency or disaster, it is the division’s responsibility to perform damage assessments for all structures.

Code Enforcement
Code Enforcement works to promote and maintain a
safe and desirable living and working environment on
all private properties around the City. Code Enforcement accomplishes this by enforcing the City’s Municipal Codes, including Property Maintenance, Nuisance, Building, and Community Development
Zoning Codes. Additionally, Code Enforcement works in
partnership with other divisions, departments, and outside agencies to support code compliance and assisting
property owners, businesses and tenants in understanding City rules and regulations.

Housing
The Housing Division manages programs and services
that increase and preserve affordable housing, improve
and preserve lower income neighborhoods, prevent and
address homelessness, and financially assist social service agencies providing services that benefit low-income
households, and works with Planning to administer and
implement programs and policies in the City’s Housing
Element and procure planning grants from federal and state sources. It manages grants from the federal Community
Development Block Grant (CDBG) program, the state
Permanent Local Housing Allocation (PLHA) fund, provides funding and ongoing monitoring of affordable housing,
including administration of the City’s Below Market Rate inclusionary program, and staffs the Community Relations Commission. The division also co-manages the HOME
Investment Partnership Program through the San Mateo
County HOME Consortium.

Planning
The Planning Division plans for the physical, social, and economic development of the City and ensures compliance with the General Plan, Zoning Code and other adopted
plans and policies, as well as the California Environmental Quality Act (CEQA) for both public and private projects.

Together with the Building Division, Planning reviews and processes private development projects to achieve a highquality built environment and long-term economic growth.

The division has two functions: Advanced Planning
prepares long-range plans and policy documents for
the physical and economic development of the City, and
administers and maintains the City’s General Plan, including the Housing Element, Specific Plans, Zoning Code, and
other policy documents to ensure compliance with state
law and to reflect community needs and desires. Current Planning provides public information on City codes and
requirements, and reviews development applications,
including coordination with other Departments and outside agencies, to ensure that development within the City
is consistent with long-range plans, community needs,
development laws and state statutes.
77 821 of 1111
Business and Admin Services
The Business and Admin Services Division manages the
Department's internal financial operations and annual
budget, provides administrative support to the other
four divisions, administers the Department’s business
and enterprise systems, processes Public Records Act
(PRA) requests and provides human resources support. In addition, the Division supports the City’s Child Care Loan program, Civic Arts Committee and Art in Public Places
program, and manages other special departmental projects.

Community Development
78 822 of 1111

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 11,024,370 $ 11,365,964
Operating 6,302,898 4,769,415
Indirect & Overhead 1,467,801 1,509,793
Total Expenditures $ 18,795,069 $ 17,645,172
Expenditures by Cost Center
Advanced Planning $ 1,663,727 $ 1,884,767
Affordable Housing 2,974,218 2,217,682
Building Inspection 299,704 267,500
Building Operations 5,942,122 6,269,056
Building Plan Checking 636,000 636,000
CDD Operations 662,816 745,462
Current Planning 4,993,279 4,278,256
General Code Enforcement 1,572,803 1,296,049
Planning Commission 50,400 50,400
Total Expenditures $ 18,795,069 $ 17,645,172
Funding Sources
General Funds $ 2,701,780 $ 2,082,117
Special Revenue Funds 16,093,289 15,563,055
Total Funding Sources $ 18,795,069 $ 17,645,172
Community Development
79 823 of 1111
Community Development

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Community Development Director 1.00 1.00
Administrative Assistant 4.00 4.00
Administrative Technician 2.00 2.00
Associate Planner 6.00 6.00
Building Inspector I/II 7.00 7.00
Business Manager 1.00 1.00
Code Enforcement Manager 1.00 1.00
Code Enforcement Officer I/II 3.00 3.00
Deputy Building Official 1.00 1.00
Deputy Community Development Director 2.00 2.00
Development Review Technician 5.00 5.00
Housing and Neighborhood Services Manager 1.00 1.00
Housing Specialist I/II 2.00 2.00
Inspection Supervisor 1.00 1.00
Managing Arborist 1.00 1.00
Office Assistant I/II 2.00 2.00
Permit Center Supervisor 1.00 1.00
Plan Check Supervisor 1.00 1.00
Plan Checker Engineer 5.00 5.00
Planning Manager 1.00 1.00
Principal Planner 2.00 2.00
Senior Business Systems Analyst 1.00 1.00
Senior Code Enforcement Officer 1.00 1.00
Senior Development Review Technician 2.00 2.00
Senior Management Analyst 1.00 1.00
Senior Planner 2.00 2.00
Total Merit 57.00 57.00
Total Per Diem 0.92 0.92
Total Positions 57.92 57.92
80 824 of 1111
Community Development

METRICS
CDD Administration
Number of staff vacancies within the year
Number of vacancies filled within the year
Number of PRA requests
Average number of business days to respond to PRA requests Building
Number of building permit applications submitted - Commercial Percent of building permit applications submitted online - Commercial Number of building permit applications submitted - Residential Percent of building permit applications submitted - % Residential Online Number of building permit applications submitted - ADU and JADU (number is subset of residential applications total) Number of building permits issued - Commercial
Number of building permitsissued - Residential
Number of building permits issued - ADU and JADU (Accessory Dwelling Unit / Junior Accessory Dwelling Unit) Number of permit inspections completed
Percent of permit inspections completed - within a two-hour window Number of in-person customers served at the Permit Center - Total CDD Customers Number of planning applications reviews
Percent of planning application reviews completed within 10 business days Number of residential permit applications reviewed - Residential building permit review efficiency Number of residential permits issued that required more than 3 plan checks before approval Number of special and emergency event responses assisting SMCFD and SMPD - Special and Emergency Event responses Number of responses that were out of regular business hours - Special and emergency event responses Number of residential VOTC (virtual over the counter) online submittal applications - Virtual permit activity Number of solar APP+ applications - Virtual permit activity Number of of BD reviews for CDD arborist
Number of of PA reviews for CDD arborist
Number of arborist inspections completed
Number of tree removal permit applications
Code Enforcement
Number of complaints received
Percent of new cases investigated/opened
Percent of new cases closed: cases that were opened and closed within reporting quarter Number of unpermitted construction cases opened
Number of all active cases: including cases from previous reporting quarters Percent of existing cases closed
Number of Substandard Housing Condition complaints received Percent of Substandard Housing Condition complaints received - Tenant relocation required Percent of Substandard Housing Condition complaints received - Repeat violator/violations Percent of Substandard Housing Condition complaints investigated within 48 business hours 81 825 of 1111
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Workload 24 5 5 5
Workload 20 5 5 5
Workload 450 800 700 700
Performance 8 10 10 10
Workload 282 300 350 350
Workload 88% 90% 90% 90%
Workload 2,873 3,892 3,892 3,892
Workload 75% 75% 75% 75%
Workload 78 100 100 100
Workload 250 220 220 220
Workload 3,800 3,600 3,600 3,600
Workload 115 90 90 90
Workload 18,115 19,000 19,000 19,000
Performance 94% 90% 90% 90%
Workload New 5,000 5,000 5,000
Workload 170 120 120 120
Performance 90% 90% 90% 90%
Workload 356 350 350 350
Workload 75 60 55 55
Workload 30 20 30 30
Workload 10 10 10 10
Workload 325 325 325 325
Workload New 60 60 60
Workload 269 250 250 250
Workload 103 100 100 100
Workload New 60 75 75
Workload New 15 25 25
Workload 1,000 1400 1,200 1,200
Workload 40% 30% 30% 30%
Performance 30% 40% 40% 40%
Workload 5 10 10 10
Workload 850 800 800 800
Performance 25% 25% 25% 25%
Workload New 15% 15% 15%
Workload 1% 1% 1% 1%
Workload 0% 0% 0% 0%
Performance 80% 100% 100% 100%
Community Development
82 826 of 1111

METRICS
Housing
Number of housing units repaired/improved through minor home repair, accessibility modifications, and Rebuilding Together grants Number of offer letters sent to Sellers of FTB and BMR Units Percentage of letters sent to Sellers of FTB and BMR Units within prescribed deadlines Number of San Mateo residents who received services through the City’s Community Funding Program Number of performed annual on-site monitoring visits of housing projects with City inclusionary units Number of BMR and First-Time Buyer Units monitored annually for owner-occupancy Planning
Number of Planning Application submittals
Number of Planning Applications Deemed Complete
Percent of planning application review efficiency - Percentage deemed complete within three review cycles Number of Zoning Administrator Planning Application Decision Letters - ZA level Decision letter prepared Percent of Zoning Administrator Level Planning Application Decision Letters processed within 20 days Number of Building Applications assigned - Building Permit Applications Reviewed by Planning Percent of Building Application plan check reviews processed within 20 business days after assignment to planner Number of Public and Community Outreach Meetings - Planning Applications and Planning Policy items reviewed by City Council Number of Public and Community Outreach Meetings - Planning Applications and Planning Policy items reviewed by Planning Commission Number of Public and Community Outreach Meetings - Community meetings and workshops Number of Neighborhood Meetings - Informal neighborhood meetings held by applicants Community Development
83 827 of 1111
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Performance 20 19 19 19
Workload 4 3 3 3
Workload 100% 100% 100% 100%
Performance 2,773 4,389 4,389 4,389
Workload 19 17 19 19
Workload 400 390 390 390
Workload 80 75 75 75
Performance 50 50 50 50
Performance 80% 80% 80% 80%
Workload 36 40 40 40
Performance 100% 95% 95% 95%
Workload 1,000 1,000 1,000 1,000
Performance 80% 80% 80% 80%
Workload New 6 6 6
Workload New 12 12 12
Workload New 8 12 12
Workload New 50 70 70
Community Development
84 828 of 1111
Finance
85 829 of 1111
Finance
Mission Statement
The Finance Department is responsible for the overall financial management of the City. The Department’s core function is to maintain a strong and secure financial position for the City by providing comprehensive financial and analytical services to the City Council, City management, staff, and the public.

Services and Structure
Operationally, the Finance Department provides the following services:

Accounting and Financial Reporting
Performing the accounting for all of the City’s financial transactions and preparing the Annual Comprehensive Financial Report and all other required annual financial statements.

Budget
Managing the annual operating and capital budget development process, and providing departments with reports and analysis to ensure expenditures are maintained within budgeted appropriations.

Treasury and Revenue Management
Managing the City’s cash and investments to ensure cash requirements are met and return on invested funds is aligned with the City’s investment policy. Administering the business license tax program, monitoring and enforcing collections of other revenue sources, and coordinating the annual update of the Comprehensive Fee Schedule.

Purchasing and Accounts Payable
Administering the purchasing program to ensure purchases are made in compliance with City policy and vendors are paid on time and accurately. Filing all required regulatory and tax-related documentation in a timely manner.

Payroll
Processing bi-weekly payroll for all of the City’s employees, reporting and paying tax obligations, and completing all regulatory reporting requirements.

Debt Service
Managing the City’s debt portfolio to ensure adequate funds are available to make principal, interest, and other debt-related payments in a timely manner; ensuring all continuing disclosure requirements are met; issuing new debt to meet City capital and infrastructure needs; and refunding existing bonds to achieve debt service savings. 86 830 of 1111

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 3,445,580 $ 3,428,137
Operating 725,800 767,800
Indirect & Overhead 343,182 361,688
Total Expenditures $ 4,514,562 $ 4,557,625
Funding Sources
General Funds $ 4,365,774 $ 4,396,466
Special Revenue Funds 72,685 78,821
Enterprise Funds 76,103 82,338
Total Funding Sources $ 4,514,562 $ 4,557,625

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Finance Director 1.00 1.00
Accountant I/II 2.00 2.00
Accounting Assistant I/II 4.00 4.00
Accounting Manager 1.00 1.00
Budget Manager 1.00 1.00
Deputy Finance Director 1.00 1.00
Finance Specialist I/II 1.00 1.00
Payroll Supervisor 1.00 1.00
Payroll Technician I/II 1.00 1.00
Senior Accountant 2.00 2.00
Senior Accounting Assistant 2.00 2.00
Senior Management Analyst 1.00 1.00
Total Merit 18.00 18.00
Total Per Diem - -
Total Positions 18.00 18.00
Finance
87 831 of 1111

METRICS
The City's annual financial statements receive an unmodified opinion from the external auditors The City's Annual Comprehensive Finance Report receives the Government Finance Officers Association Certificate of Achievement for Excellence in Financial Reporting
The City's Annual Comprehensive Finance Report is approved by Council by December 31st Number of business license renewals processed
Number of new business licenses issued
Number of employee paychecks issued
Percent of paychecks issued with no customer-facing errors Number of invoices received
Percent of vendor payments made with no errors
Percent of months City's investment portfolio complies with investment policy Average duration of City's investment portfolio
Percent of months yield on the City's investment portfolio meets benchmark performance targets Percent variance between final estimated revenues and actual revenues for major General Fund taxes Percent of purchase orders processed within 3 business days Number of change orders processed in Purchasing
Number of new credit cards issued
Percent variance between budget and actual General Fund expenditures Finance
88 832 of 1111
Finance
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Performance Yes Yes Yes Yes
Performance No Yes Yes Yes
Performance No Yes Yes Yes
Workload 6,800 7,000 7,000 7,000
Workload 1,100 1,200 1,200 1,300
Workload 17,750 17,820 17,800 18,000
Performance >99% >99% >99% >99%
Workload 11,600 10,000 10,000 10,000
Performance 99% >99% >99% >99%
Performance 100% 100% 100% 100%
Other 528 days 750 days 730 days 520 days
Performance 100% 100% 100% 100%
Performance 1% <5% <5% <5%
Performance 99% >95% >95% >95%
Workload 284 250 260 200
Workload 27 20 22 25
Performance 4% <5% <5% <5%
89 833 of 1111
Human Resources
90 834 of 1111
Human Resources
Mission Statement
The Human Resources Department is responsible for programs in personnel recruitment and selection, classification and position control, labor and employee relations, performance management, employee training and development, salary and benefit administration, workers’ compensation, employment related policies, safety programs, and employee service awards.

Services and Structure
The Human Resources Department focuses on the following areas that support the City’s departments and workforce:

Recruitment, Selection, and Classification / Compensation Directs the City’s recruitment, selection, and retention program, ensuring it meets legal requirements and civil service expectations; oversees the City’s position and vacancy control systems; determines appropriate classifications and compensation for positions; and monitors employee retention for the City.

Employee and Labor Relations
Coordinates the collective bargaining process; ensures contractual changes are implemented; guides performance management, grievance resolution, employee conflict resolution, and administration of the City’s discipline process; and schedules matters before the Personnel Board.

Employee Services / Benefits
Manages the City’s benefit programs, leave of absence, and bilingual program; and directs the City’s automated personnel record keeping system.

Employee Services / Employee Development and Workforce Planning Oversees the Citywide training programs, new hire orientation, and employee recognition program. Develops and conducts professional development initiatives, fosters diversity, and encourages cross-departmental collaboration. Provides resources and expertise in support of departmental workforce planning efforts. Administers the tuition reimbursement program.

Workers’ Compensation
Provides oversight for the third party administrator's management of all claims; monitors compliance with the Americans with Disabilities Act (ADA); oversees administration of the Department of Transportation (DOT) regulations, the City's safety program, and modified duty program.

Human Resources Support to San Mateo Consolidated Fire Department (SMC Fire) Performs human resources activities on a contract basis for SMC Fire as coordinated by an on-site Senior Human Resources Analyst.
91 835 of 1111

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 2,354,848 $ 2,652,593
Operating 5,352,266 4,579,348
Indirect & Overhead 140,583 144,282
Total Expenditures $ 7,847,697 $ 7,376,223
Funding Sources
General Funds $ 2,602,898 $ 2,766,970
Enterpirse Funds - 138,699
Internal Service Funds 5,244,799 4,470,554
Total Funding Sources $ 7,847,697 $ 7,376,223

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Human Resources Director 1.00 1.00
Deputy Human Resources Director 1.00 1.00
Human Resources Analyst I/II 1.00 1.00
Human Resources Technician* 3.00 4.00
Senior Human Resources Analyst 4.00 4.00
Senior Human Resources Analyst Risk Manager 1.00 1.00
Total Merit 11.00 12.00
Total Per Diem 0.48 0.48
Total Positions 11.48 12.48
* 1.00 FTE HR Technician is a 2 year limited term position.

Human Resources
92 836 of 1111
Human Resources

METRICS
Recruitment, Selection, and Classification
Number of recruitments conducted
Number of weeks from signed Recruitment Plan to Eligibility List Percent of hiring departments rating recruitment as good or better Annual percent of employee turnover rate
Number of classification reviews and job spec updates
Employee and Labor Relations
Percent of employee performance evaluations completed on time Percent of departing merit employees who have an exit interview Percent of disciplinary actions determined within 60 days from completion of investigation Percent of grievances and disciplinary actions resolved within the agency Number of labor contracts negotiated
Number of employees trained on Employee & Labor Relations Employee Services/Benefits
Number of employees attending benefits seminars (EAP, deferred comp, CalPERS) Percent of employees voluntarily participating in a deferred compensation plan Number of benefits orientations conducted during NHO
Number of leave requests processed
Number of Wellness Program events per year
Employee Services/Employee Development & Workforce Planning Number of employee participation in training courses
Percent of participants satisfied with City sponsored training courses Number of employees participating in the Citywide Talent Exchange Number of employees in Lead Worker, Supervisor, & Leadership Academies Number of employees utlizing professional leadership coaching Workers’ Compensation and Safety
Number of claims opened during the fiscal year
Cost of incurred claims
Percent of new hires receiving IIPP training
Support to SMC Fire
Number of recruitments conducted
Percent of disciplinary actions determined within 60 days from completion of investigation Number of workers' compensation indemnity claims opened in the fiscal year 93 837 of 1111
Human Resources
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Workload 40 40 65 65
Performance 5 weeks <8 Weeks <8 weeks <8 weeks
Performance 99.50% >90% >90% >90%
Performance 15% <15% <15% <15%
Workload 25 25 45 45
Performance 80% 80% 80% 80%
Workload 80% 80% 80% 80%
Performance 90% 90% 90% 90%
Performance 90% 90% 90% 90%
Workload 5 5 5 5
Workload 40 40 30 30
Performance 115 115 60 60
Performance 80% 80% 80% 80%
Workload 3 3 3 3
Workload 60 60 60 60
Workload 3 3 2 2
Workload 450 450 500 500
Performance 90% 90% 90% 90%
Performance 3 3 2 2
Workload 24 24 24 24
Performance 12 12 12 12
Workload 70 <70 <60 <60
Performance $3.5M <$3.6M <$2.6M <$2.6M
Performance 100% 100% 100% 100%
Workload 5 5 6 5
Performance 90% 90% 90% 90%
Performance / Workload 33 35 30 30
94 838 of 1111
Information
Technology
95 839 of 1111
Information Technology
Mission Statment
The Department of Information Technology (DoIT) works collaboratively with all City departments to deliver the highest quality IT services, infrastructure, and technology consulting possible. DoIT ensures the technologies that are being utilized serve business needs, help staff to be effective and efficient, and can be maintained long term.

Services and Structure
Operationally, DoIT provides the following services:

Consulting and Applications (BusCon)
Works collaboratively with departments to explore evolving business needs, define requirements, and build solutions.

Acts as internal IT consultants, partnering with departments to explore departmental, multi-departmental, and Citywide business needs as they relate to technology. Supports and maintains applications and systems once they are put into production. The BusCon team also provides support for the City’s public Internet web presence, and administers, maintains, and supports the City’s Intranet platform as a collaborative workspace that serves Citywide and individual department operational business needs.

Geographic Information Systems (GIS)
Supports and maintains all GIS systems Citywide and creates GIS and mapping products, including a Police Accountability & Transparency dashboard, elections dashboard, Marina Lagoon dashboard, property information lookup, traffic and transportation improvements, Adopt-A-Drain, and other web maps.

Systems and Networks
Manages the operation, maintenance, and support of all City technology infrastructure and technology assets. Technology infrastructure includes all server-based systems (application hosting, file/data storage, backup), telephone systems, Local Area Network/Wide Area Network (LAN/WAN), and Internet connectivity. Systems and Networks is also the lead for cybersecurity protections for the City and administers cloud applications such as Microsoft 365.

Technical Support / Customer Service
Provides end user technology support through our Help Desk. Offers end user technology training resources. The Customer Support team also manages all end points (PCs) and the PC replacement schedule. 96 840 of 1111

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 3,221,750 $ 3,276,096
Operating 1,769,027 1,873,462
Indirect & Overhead 212,121 212,600
Capital Outlay 17,165 17,680
Total Expenditures $ 5,220,063 $ 5,379,838
Funding Sources
General Funds $ 5,086,661 $ 5,245,027
Special Revenue Funds 133,402 134,811
Total Funding Sources $ 5,220,063 $ 5,379,838

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Information Technology Director 1.00 1.00
Consulting and Applications Manager 1.00 1.00
Custom Service Manager 1.00 1.00
GIS Coordinator 1.00 1.00
GIS Technician I/II 1.00 1.00
IS Support Technician I/II 2.00 2.00
Network Analyst 1.00 1.00
Senior IS Support Technician 1.00 1.00
Senior Systems Analyst - 1.00
Systems Analyst I/II 3.00 2.00
Systems and Network Manager 1.00 1.00
Web Specialist 1.00 1.00
Total Merit 14.00 14.00
Total Per Diem 0.23 0.23
Total Positions 14.23 14.23
Information Technology
97 841 of 1111

METRICS
Percent of Help Desk calls completed within 48 hours or less Number of Help Desk calls annually
Percent of GIS requests completed within agreed upon time and scope Number of GIS requests annually
Composite Score, technology infrastructure reliability
Annual Customer Satisfaction Survey rating
Information Technology
98 842 of 1111
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Performance 97% 90% 90% 90%
Workload 4,294 3,500 3,500 3,500
Performance 99% 90% 90% 90%
Workload 91 75 75 75
Performance 98.84% 99.90% 99.90% 99.90%
Performance 99% 95% 90% 90%
Information Technology
99 843 of 1111
Library
100
844 of 1111
Library
Mission Statement
San Mateo Public Library builds community by inspiring imagination, discovery, and learning.

Services and Structure
The Library Department is organized in the following divisions:

Administrative Services
Oversees the administrative services of the Library, including fiscal operations (budget, payroll, accounting); business contracts; facilities and safety; personnel processes and recordkeeping; meeting room rentals; the Passport Acceptance Office; Library IT and technology support; volunteer program; and supports the City Librarian’s work with the Library Board of Trustees.

Adult-Teen / Information Services
Adult – Teen & Information Services coordinates the delivery of information services; develops collections and programs to meet the needs of a diverse community; cultivates partnerships to leverage the effort to reach a wider audience; instructs library customers on the use of electronic resources and tools; and promotes reading and literacy.

Children’s / Literacy Services
Children’s Services provides library and literacy services to children (infants-8th grade), caregivers, and parents; develops resources that meet diverse needs; provides reader’s advisory service appropriate for reading interests and abilities; and assists students to succeed in school and meet personal learning goals.

Adult Literacy Services (Project Read) provides free, confidential, and goal-directed literacy instruction in small groups or one-on-one tutoring to adults over 16 years of age so that learners can meet their literacy goals and fulfil important roles as family members, workers, and community members.

Circulation / Technical Services
Circulation Services maintains the database of registered users; issues library cards; oversees the lending, maintenance and return of library materials including the technology device lending collection; bills and collects on accounts; oversees operations at Accounts Desks and self-checkout stations; upkeeps the library’s collections; manages reserve/holds operations; maintains and troubleshoots library technologies and systems; and assists with outreach in the community through mobile circulation technology.

Technical Services oversees the acquisition, cataloging, and processing of all library materials (print, media, and periodicals) for all three locations; maintains the library’s collection through repair, preservation, and deaccessioning of library materials that are dated or in poor condition. The division also provides oversight and processing responsibilities of the LINK+ interlibrary loan system.
101
845 of 1111

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 6,514,411 $ 6,560,289
Operating 2,361,363 2,531,484
Indirect & Overhead 885,390 932,676
Total Expenditures $ 9,761,164 $ 10,024,450
Funding Sources
General Funds $ 9,761,164 $ 10,024,450
Total Funding Sources $ 9,761,164 $ 10,024,450

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
City Librarian 1.00 1.00
Administrative Technician 1.00 1.00
Community Services Coordinator 1.50 1.50
Deputy City Librarian 1.00 1.00
Executive Assistant 1.00 1.00
Librarian I/II 9.63 9.63
Library Assistant I/II 9.75 9.75
Library Technology Specialist 1.00 1.00
Literacy Program Coordinator 1.00 1.00
Literacy Specialist 0.63 0.63
Senior Accounting Assistant 1.00 1.00
Senior Library Assistant 3.00 3.00
Senior Management Analyst 1.00 1.00
Supervising Librarian 3.00 3.00
Supervising Library Assistant 1.00 1.00
Total Merit 36.51 36.51
Total Per Diem 17.15 13.23
Total Positions 53.66 49.74
Library
102
846 of 1111
Library

METRICS
Number of non-digital library materials in circulation
Number of digital library materials in circulation
Percent of self-checkout transactions
Number of library patrons receiving technology assistance/instruction Number of participants in library's reading programs
Percent of respondents to Customer Satisfaction Survey who rate library service as excellent or good Number of annual visits by library patrons
Number of patrons served through outreach
103
847 of 1111
Library
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Workload 268,691 270,000 275,000 275,000
Workload 1,526,369 1,600,000 1,600,000 1,600,000
Performance 85% 87% 87% 87%
Workload 10,621 12,000 12,500 13,000
Workload 7,483 7,500 7,600 7,600
Performance 96% 90% 90% 90%
Workload 379,404 385,000 390,000 395,000
Workload 8,039 8,500 9,000 9,000
104
848 of 1111
Parks and
Recreation
105
849 of 1111
Mission Statement
The Parks and Recreation Department’s mission is to enhance the quality of life and strengthen the bonds of community by providing an appropriate mix of safe, well-maintained and well-designed parks, open spaces, and community center facilities that are accessible for all residents; provide enriching leisure opportunities for all age groups; and to preserve and protect the City’s natural resources, including its urban forest, public open spaces, and landscaped medians and islands.

Services and Structure
Operationally, the Parks and Recreation Department provides the following services:

Landscape Resources
Provides for the maintenance and conservation of all parks, open spaces, and public medians and right of ways and ensures the long-term protection of the City’s urban forest through scheduled maintenance activities.

Golf and Visitor Services
Operates Poplar Creek Golf Course and driving range through concessionaire agreements, pro shop services, and food and beverage services. Visitor services provides park ranger presence in parks to promote and support positive user experiences and enforcement of City ordinances.

Park Planning and Development
Provides for park planning, capital improvement program management, project design, and construction management services through the use of both in-house and professional consultant resources.

Administrative Services
Coordinates the department’s administrative and business services that support operational units, thereby maximizing our efficiency and effectiveness in areas such as internal work-flow, customer service, marketing, and budget management.

Recreation and Community Services
Provides a comprehensive program of recreational, instructional, and community-building activities for all age groups utilizing community centers, aquatic facilities, numerous parks and school sites.

Parks and Recreation
106
850 of 1111
Parks and Recreation

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 12,984,517 $ 12,938,837
Operating 8,048,729 8,437,701
Indirect & Overhead 1,996,197 2,117,151
Capital Outlay 161,000 26,000
Total Expenditures $ 23,190,443 $ 23,519,690
Expenditures by Cost Center
Arborist $ 1,341,599 $ 1,356,076
Community Services 10,435,228 10,559,688
Golf Services 2,956,150 3,081,789
Park Planning 452,928 433,392
Parks & Landscapes 7,979,531 8,063,738
Parks & Rec Operations 25,007 25,007
Total Expenditures $ 23,190,443 $ 23,519,690
Funding Sources
General Funds $ 23,150,443 $ 23,519,690
Internal Service Funds 40,000 -
Total Funding Sources $ 23,190,443 $ 23,519,690
107
851 of 1111
Parks and Recreation

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Parks and Recreation Director 1.00 1.00
Administrative Technician 3.00 3.00
Business Manager 1.00 1.00
Communications and Public Relations Analyst 1.00 1.00
Community Services Coordinator 9.00 9.00
Community Services Manager 1.00 1.00
Community Services Section Manager 2.00 2.00
Community Services Supervisor 7.00 7.00
Custodian 1.00 1.00
Deputy Parks and Recreation Director 1.00 1.00
Golf Course Maintenance Supervisor 1.00 1.00
Golf Equipment Maintenance Specialist 1.00 1.00
Golf Services Manager 1.00 1.00
Irrigation Specialist 2.00 2.00
Landscape Maintenance Worker I/II 15.00 15.00
Lead Teacher 2.00 2.00
Managing Arborist 1.00 1.00
Park and Landscape Maintenance Supervisor 1.00 1.00
Park and Landscape Manager 1.00 1.00
Senior Park Landscape Maintenance Worker 3.00 3.00
Senior Park Ranger 1.00 1.00
Senior Program Assistant 5.00 5.00
Senior Project Manager 1.00 1.00
Tree Maintenance Specialist 1.00 1.00
Total Merit 66.00 66.00
Total Per Diem 50.17 50.17
Total Positions 116.17 116.17
108
852 of 1111
Parks and Recreation

METRICS
Landscape Resources - Parks
We provide environmental stewardship of the City’s park land, civic facilities, medians, islands, and right-of ways.

Number of acres of developed park land, civic facilities, medians, and islands maintained ¹ Cost per acre to maintain developed park land, civic facilities, medians, and islands Percent of maintenance standards met at park land, civic facilities, medians, and islands Percent of park visitors who agree that the park and park landscaping was well maintained Percent of park visitors who reported feeling a high level of safety in our parks Number of acres of developed community parks and neighborhood parks with sports fields Water usage per acre at developed community parks and neighborhood parks ² Percent of maximum labor captured in Cartegraph
Landscape Resources - Trees
We provide environmental stewardship to the City’s street and park trees.

Number of street and park trees maintained
Number of street and park trees pruned annually
Percent of street and park trees pruned annually
Number of new trees planted
Percent of street and park trees removed that are replaced by newly planted trees Number of tree service requests
Percent of tree service requests responded to within 10 working days Golf
We efficiently operate an 18-hole golf course.

Number of golf rounds played annually
Percent of golf tee times utilized
Percent of golf course operating expenses covered by revenues We provide a community resource.

Number of golf course tournaments and clubhouse events facilitated annually Recreation
We provide opportunities for Active and Healthy Lifestyles, Creative Outlets, Creating Community, Youth Development, and Lifelong Learning.

Number of program registrants
Number of special events attendees
We balance providing affordable recreation and access for all with appropriate cost recovery through user fees.

Percent of programs covering costs within the cost recovery target range Number of unduplicated youth that received fee assistance to attend Recreation programs ¹ Target now includes acreage for medians and islands.
² Water usage is only tracked in those neighborhood parks with significant sports turf on a calendar year. 109
853 of 1111
Parks and Recreation
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Workload 289.7 289.7 289.7 289.7
Performance $ 27,000 $ 28,000 $ 29,000 $ 29,000
Performance 85% 85% 85% 85%
Performance 95% 95% 95% 95%
Performance 95% 95% 95% 95%
Workload 112.9 112.9 112.9 112.9
Performance 484 484 484 484
Performance 70% 70% 70% 70%
Workload 23,600 25,000 25,000 25,000
Performance 2,400 2,400 2,400 2,400
Performance 10% 10% 10% 10%
Workload 150 250 300 300
Performance 110% 125% 150% 150%
Workload 300 300 300 300
Performance 95% 95% 95% 95%
Workload 82,000 82,000 83,000 83,000
Performance 80% 82% 82% 82%
Performance 100% 100% 100% 100%
Workload 325 200 325 350
Workload 24,000 24,250 24,400 24,400
Workload 26,000 26,250 26,400 26,400
Performance 45% 45% 45% 45%
Other 650 675 700 700
110
854 of 1111
Parks and Recreation

METRICS
Recreation (cont.)
We encourage the involvement of youth and create a safe environment for them in our community.

Number of Recreation program registrants who are youth
Percent of Recreation program registrants who are youth Number of youth registrants made water safe through City swim lessons We offer our facilities as a community resource.

Number of public rentals occurring at recreation centers We have happy, satisfied customers.

Percent of course registration occurring online
111
855 of 1111
Parks and Recreation
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Performance 16,000 16,500 17,000 17,000
Performance 65% 65% 65% 65%
Performance 1,000 600 600 600
Workload 500 525 550 550
Performance 92% 92% 93% 93%
112
856 of 1111
Police
113
857 of 1111
Police
Mission Statement
Safeguarding and serving our City with professionalism, integrity and proactive, community-oriented policing is our mission. The men and women of the San Mateo Police
Department are progressive and professional; dedicated
peace keepers, defenders of our community’s quality of
life, and problem solvers protecting our community. We
provide a safe and secure quality of life through resolution of issues and problems by aligning community partnerships and resources through ongoing collaborations. We have
a committed, diverse, and outstanding group of men
and women in this department dedicated to providing
outstanding public service.

Accountability, compassion, collaboration, legitimacy,
integrity and respect are our guiding principles as we
provide service while adhering to the highest ethical
standards. The department is dedicated to protecting
with honor and serving with pride. We provide creative, proactive, and long-term solutions to issues that arise, strengthening and securing our neighborhoods. We strive to be the model police agency that others will emulate
and a leader in the county and our profession, adopting creative and innovative strategies to prevent crime and support those most in need. We provide our services
through a trauma-informed restorative justice approach, understanding that many who offend require more than jail to rehabilitate and restore their lives.

The Police Department is committed to improving the
quality of life in our city, by recognizing community needs, forming partnerships, and working with allied agencies
to ensure long-term resolution to crime and disorder
issues. We will continue to do this through cutting-edge technology, creative solutions to problems, by respecting individual rights, conducting fair and non-biased policing, and good, old-fashioned police work.

Services and Structure
The San Mateo Police Department is a 24/7 comprehensive community policing department divided into three primary service units: Field Operations Services; Support Services which includes the Investigations and Youth Services Units; and Communications, Records and Technology Services.

Field Operations Services Bureau (FOSB)
FOSB provides around-the-clock uniformed police
protection and responds to all requests for police
assistance. Based on a geographic service delivery model, staff are assigned to their patrol beats on a long-term basis so that patrol officers and Area Lieutenants form partnerships with their assigned communities to resolve problems and proactively prevent crime, disorder, and
delinquency.

Field Operations Services includes the following
specialized units:
• The Traffic Unit provides enforcement of traffic
laws, expert collision investigations, and parking
enforcement while meeting our community’s traffic
safety needs. The Traffic Unit collaborates with the
Public Works Department and other allied agencies
to provide a comprehensive approach addressing
the critical factors that contribute to safe streets
(engineering, education, and enforcement) and
formulates Neighborhood Traffic Safety Action Plans
to address neighborhood traffic and parking issues.

The San Mateo Police Department Traffic Unit has fully
committed providing timely and responsive police
services to mitigate the impacts of traffic and parking on our community, and to improve safety on our
roadways for pedestrians, bicycles, and vehicles.
• The Crime Reduction Unit (CRU) is dedicated to the
eradication of violent crime, gang activity, drug activity, and serial crime patterns. CRU provides proactive
targeted enforcement aimed at abating community
crime, problem locations, career criminal offenders,
and organized criminal activity, including human
trafficking and the associated activities that often lead to the victimization of our youth.
• The Downtown Unit serves our downtown and
surrounding areas on foot and bike patrol and is
dedicated to ensuring a safe and vibrant environment
for our business districts. These officers also serve
as a business liaison and support mechanism,
seeking long-term solutions for the chronic homeless,
inebriates, and those with mental illness. They also
work closely with the entertainment and alcohol
businesses in the downtown and other business
districts, regulating and permitting establishments,
while fostering economic development through a safe
environment in San Mateo’s busy downtown.
114
858 of 1111
Police
• FOSB provides special technical on-call units that
include the Special Weapons and Tactics Team
(SWAT), and the Tactical Negotiations Team (TNT).

These special units are staffed on an as-needed basis
and are used in high-risk search and arrest warrant
service, as well as being part of a regional team
responding to critical incidents involving armed and
dangerous subjects.
• FOSB oversees the K-9 program, Field Training
Program, the Behavioral Health and Recovery Services
Mental Health Clinicians, the Homeless Outreach
Team, and provides operational support for the
Department, including the Critical Incident Response
Team and the Peer Support Unit.

Support Services
Support Services Administration Bureau encompasses
two major areas: support and development along with
neighborhood outreach. Bureau operations and personnel
provide personnel hiring and training; accounting and
budgetary functions; facility and equipment maintenance; research, development, and planning; business services; media services; and Internal Affairs and Professional
Standards.

Staff in the Support Services Bureau conduct recruitments to ensure that our highly qualified candidates reflect
the diverse nature of the community we serve; provide
business and fiscal management for the department; and
coordinate and facilitate all departmental training. Our Media Services Unit continues to find innovative ways
to keep our community informed while engaging them
in long-term problem solving strategies and information sharing in their neighborhoods. Our Neighborhood Watch
Program administers over 300 Neighborhood Watch Blocks
dedicated to partnering with their neighborhood Police
Officers to advance safety, security, and community within our neighborhoods. Subscribers to our Community Alert
System and social media outlets currently exceeds 165,000 and continues to increase as we further efforts to enhance community awareness.

Investigations and Youth Services Bureau
Investigations and Youth Services conducts major
investigations into crimes against persons, property,
businesses, and institutions. Detectives track and monitor sexual registrants, drug registrants, and early release prisoners placed on Post Released Community Supervision (PRCS). Investigation Services is responsible for covert operations directed toward the apprehension of the most serious and career criminals. Detectives prepare cases for prosecution and develop expertise in specific specialty investigations, including crimes against the elderly,
domestic violence, and high-tech crimes. Our Investigations Services Bureau focuses on special and vulnerable victims of crime, working with service providers to reduce the harm to victims.

Our Youth Services Unit (YSU), is responsible for oversight of youth programs encompassing a balanced approach
of professionalism, integrity, and excellence. The unit consists of the popular and highly effective San Mateo
Police Activities League (SM PAL), as well as Youth
Services Officers (YSO). The YSU encompasses crime and
prevention efforts aimed at our youth who are suspects
or victims of crime or gang or bullying efforts. The YSU enacted a trail blazing Diversion Program with a goal of reducing the number of youth introduced into the juvenile justice system. Our Diversion Program is a leader for the County, and has received funding from the County to
regionalize the program and hire counseling for troubled youth and their families, thereby increasing the resiliency and support for these youth to get back on track, stay in school, and out of trouble.

Communications, Records and Technology Services
The Communications, Records and Technology Division
provides outstanding infrastructure to front line operations in all aspects. The division is responsible for providing a high level of customer service while taking and dispatching emergency calls; receiving, processing and storing police records and property in accordance with all applicable
laws; operating computer systems and applications
management; and managing and integrating technology
into police operations.

Staff in the unit provide a highly professional 24 hour emergency communications dispatch center which
receives and dispatches 911 calls and requests for services; maintain accurate police records, property and evidence functions in accordance with all required laws; and manage the implementation and maintenance of department
technology, keeping a vision on the future and a priority on integrating sustainable solutions. The unit is also
responsible for ensuring the ongoing vitality of citywide radio and communications infrastructure.
115
859 of 1111
Police

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 54,896,812 $ 57,208,296
Operating 9,725,419 9,809,179
Indirect & Overhead 968,361 990,552
Capital Outlay 341,000 77,000
Total Expenditures $ 65,931,592 $ 68,085,027
Expenditures by Cost Center
Communications, Records & Technology Admin $ 2,438,748 $ 2,708,544 Crime Reduction Unit 4,073,965 3,540,644
Criminal Investigations 5,093,309 5,902,718
Dispatch 3,588,164 4,473,794
Downtown Security 154,740 785,671
Enrichment Activities 75,303 78,403
Facilities and Overhead 985,751 1,035,494
Field Operations Admin Unit 1,635,117 1,861,996
PAL Life Skills/Leadership 81,831 87,104
Parking Enforcement 1,770,437 1,776,253
Patrol Unit 29,739,173 30,059,023
Police Youth Services 2,181,981 2,319,481
Prevention/Intervention 132,729 140,894
Program Support 212,056 236,189
Records & Property 1,570,393 1,824,466
Sports Development 79,080 84,746
Support Services Admin 8,433,077 7,586,887
Traffic Unit 3,685,738 3,582,720
Total Expenditures $ 65,931,592 $ 68,085,027
Funding Sources
General Funds $ 63,787,941 $ 66,284,984
Special Revenue Funds 2,143,651 1,800,043
Total Funding Sources $ 65,931,592 $ 68,085,027
116
860 of 1111

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Chief of Police 1.00 1.00
Administrative Assistant 2.00 2.00
Administrative Technician 1.00 1.00
Business Manager 1.00 1.00
Community Service Officer I/II 5.00 5.00
Crime and Intelligence Analyst 1.00 1.00
Dispatch Services Supervisor 2.00 2.00
Dispatcher 12.00 12.00
Management Analyst I/II 2.00 2.00
Police Captain 2.00 2.00
Police Communications and Public Relations Analyst 1.00 1.00 Police Digital Forensic Specialist 1.00 1.00
Police Evidence Analyst 1.00 1.00
Police Lieutenant 6.00 6.00
Police Officer 90.00 90.00
Police Records Specialist I/II 5.00 5.00
Police Records Supervisor 2.00 2.00
Police Sergeant 17.00 17.00
Police Support Services Analyst 1.00 1.00
Police Technical Services Administrator 1.00 1.00
Senior Business Systems Analyst 1.00 1.00
Senior Community Service Officer 1.00 1.00
Senior Dispatcher 2.00 2.00
Senior Management Analyst 1.00 1.00
Senior Police Records Specialist 2.00 2.00
Vehicle Abatement Officer 2.00 2.00
Total Merit 163.00 163.00
Total Per Diem 12.75 11.96
Total Positions 175.75 174.96
Police
117
861 of 1111
Police

METRICS
Field Operating Services
We take a collaborative approach to address critical factors that contribute to safe streets, and strive to increase safety through implementation of comprehensive Traffic Action Plans conducted in targeted areas based on violations, complaints, and collision data; and seek to mitigate the impact of traffic and parking violations on neighborhoods.

Number of pedestrian or bicycle collisions with motor vehicles Number of drunk driving arrests
Number of Abandoned Vehicle Complaints
Percent of reported abandoned vehicle complaints resolved w/in 5 calendar days Number of parking citations issued
We work to maintain a safe, secure City through smart policing tactics and data driven strategic policing through prevention, intervention, and enforcement.

Number of SMPD calls for service
Number of officer-initiated incidents
Number of reported incidents of violent crime (murder, rape, robbery, aggravated assault) Number of reported incidents of property crime (burglary, motor vehicle theft, auto burglary, larceny, arson) We conduct outreach and intervention to assist those experiencing homelessness, mental health crises, or in need of other social services.

Number of Community Wellness and Crisis Response Team calls for service Number of homeless outreach referrals to services
Support Services
We recruit and conduct background investigations to identify highly qualified candidates for hire to join the Police Department Number of sworn police officers hired
Number of professional staff hired
We offer youth services aimed at providing intervention and diverting juveniles from the Criminal Justice System.

Number of juveniles diverted from the court system to the Youth Services Division Number of youth participating in Police Activities League prevention/intervention programs We seek to enhance community awareness and engagement through innovative messaging, along with conventional and social media Number of subscribers to the Police Department's Community Alert System and social media Number of media inquiries answered
Number of press releases issued
Number of officer visits to schools and community events Our staff is devoted to protecting with honor and serving with pride by providing ethical and compassionate service to our public.

Survey respondent average rating of overall satisfaction with police services on a scale of 1-5 118
862 of 1111
Police
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Workload 89 80 N/A N/A
Workload 270 250 N/A N/A
Workload 3,530 4,500 N/A N/A
Performance 100% 99% 95% 95%
Workload 60,279 56,000 N/A N/A
Workload 72,677 73,300 N/A N/A
Workload 29,784 28,500 N/A N/A
Workload 753 800 N/A N/A
Workload 1,828 1,950 N/A N/A
Workload 158 150 N/A N/A
Workload 850 700 N/A N/A
Workload 18 10 N/A N/A
Workload 18 12 N/A N/A
Workload 39 70 50 50
Workload 2,982 4,000 4,100 4,200
Other 181,177 187,000 190,000 195,000
Workload 210 225 N/A N/A
Workload 83 100 N/A N/A
Other 58 65 65 70
Performance 4.38 4.37 4.5 4.5
119
863 of 1111

METRICS
Communications, Records and Technology
We strive to quickly respond to all emergencies.

Total 911 calls answered
Number of Priority 1 calls (*reclassified in FY22/23 to exclude 911 hangups) Average response time from dispatch of a Priority 1 call to arrival of responding officer Average answering time from moment call enters system to time it takes to answer Percentage of Priority 1 calls dispatched within 90 seconds of receipt Police
120
864 of 1111
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Performance 29,208 31,100 N/A N/A
Performance 305 320 N/A N/A
Performance 5 min; 22 sec 4 min; 56 sec <7 minutes <7 minutes Performance 99.5% answered w/in
15 seconds

99.4% answered w/in
15 seconds
95% answered w/in 15
seconds
95% answered w/in 15
seconds
Performance 98% 99% 90% 90%
Police
121
865 of 1111
Public Works
122
866 of 1111
Mission Statement
Enhancing the community and its environment by providing sustainable stewardship and innovative approaches to
Public Works services.

Overview
The Public Works Department is separated into two
strategic Sections for optimal performance and
integration - Environmental Services and Engineering
Services. The two Sections work together to meet the
needs of the community.

Services and Structure
Environmental Services Division
The Environmental Services Section is comprised of four main Divisions, including the (1) Wastewater Treatment
Plant, (2) Clean Water Program, (3) Field Maintenance,
and (4) Data Management, with multiple subprograms to
provide specific services for the community.
• Wastewater Treatment Plant (WWTP) includes
the administration, management, operation, and
maintenance of the facility, including laboratory
services. As a sub-regional facility, the WWTP
provides treatment of sanitary sewage to neighboring
communities and is partially owned by Foster City.

The WWTP protects the public health and water
environment of the community by providing high
quality wastewater treatment services in compliance
with the National Pollutant Discharge Elimination
System (NPDES) permit, and Stormwater Pollution
Prevention Program (SWPPP) as required by the State
Industrial General Permit (IGP).
• Clean Water Program is the 10-year, $1 billion program encompassing capital improvements to the sanitary
sewer collection system and WWTP necessary to
replace aging infrastructure, provide wet weather
capacity assurance, meet current and future regulatory
requirements, and align with the City’s sustainability
goals.
• Field Maintenance is comprised of specialized
programs to maintain the City’s streets, sewer
and storm system infrastructure, and flood control
systems. This division provides services, repair, and
maintenance of streets, bridges, sidewalks, bike paths, signs and markings, sewer collection infrastructure,
storm drains, traffic signals, streetlights, and street sweeping.

Public Works
• Data Management is responsible for the development
and administration of the Department’s asset
management platform and Geographic Information
System and for building and maintaining the City’s
infrastructure database.

Engineering Services Division
The Engineering Services Section consists of four main
Divisions, including (1) Engineering, (2) Facilities and Fleet Services, (3) Regulatory Compliance, and (4) Transportation (including Traffic Engineering, Right-of-Way/Permitting, Private Development, and Transportation Planning).
• Engineering provides design and construction
management services for capital improvement
projects to improve the City’s streets, sewer, and storm drain systems. This includes design and construction
to reduce failed streets as identified by the City
Council.
• Facilities and Fleet Services is responsible for
providing centralized maintenance for all City
buildings and park infrastructure. The program is
also responsible for all building and infrastructure
upgrades, remodels, and new building construction. In
addition, it provides implementation and oversight of
the fleet maintenance contractor, who services all City vehicles.
• Regulatory Compliance manages and implements
programs and provides compliance oversight to
meet all regulatory requirements for wastewater,
stormwater, solid waste, and air quality. The division
also provides management of the Marina Lagoon
water quality, dock construction, vegetation
management, and sand replenishment.
• Transportation is responsible for ensuring that the
City’s traffic and transportation infrastructure is
operated safely and efficiently. The program works
on issues at the local and regional levels, performs
studies to identify solutions, evaluates traffic impacts of developments, provides traffic and transportation
related designs for the Capital Improvement Program,
and traffic signal coordination. This division is also
responsible for ensuring improvements in the public
right-of-way and private developments are built to
the appropriate quality standards to ensure a safe,
accessible, and aesthetically pleasing public right-ofway. 123
867 of 1111
Public Works

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Personnel $ 26,350,871 $ 26,277,349
Operating 29,200,845 28,138,888
Indirect & Overhead 3,598,715 3,699,748
Capital Outlay 448,593 1,477,300
Total Expenditures $ 59,599,024 $ 59,593,285
Expenditures by Cost Center
Facilities $ 3,520,978 $ 3,546,324
Fleet 2,662,687 2,699,030
Private Development 1,566,629 1,692,791
Public Works Administrative Services 1,003,567 737,684
Sewer 11,461,172 11,336,946
Solid Waste Management 3,158,939 3,090,970
Storm 2,294,421 2,633,005
Streets 4,412,044 4,007,027
Transportation 6,398,100 5,973,823
Wastewater Treatment Plant 23,120,487 23,875,685
Total Expenditures $ 59,599,024 $ 59,593,285
Funding Sources
General Funds $ 11,958,686 $ 10,016,465
Special Revenue Funds 5,680,580 6,373,298
Enterprise Funds 35,776,093 36,958,168
Internal Service Funds 6,183,665 6,245,353
Total Funding Sources $ 59,599,024 $ 59,593,285
124
868 of 1111
Public Works

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Public Works Director 1.00 1.00
Administrative Assistant 6.00 6.00
Administrative Technician 2.00 2.00
Associate Engineer 14.00 14.00
Associate Transportation Planner 1.00 1.00
Building Maintenance Supervisor 1.00 1.00
Business Manager 1.00 1.00
Calibration Technician 1.00 1.00
Central Services Worker 1.00 1.00
Construction Inspector I/II 4.00 4.00
Deputy Director 2.00 2.00
Downtown Coordinator 1.00 1.00
Engineering Manager 3.00 3.00
Engineering Technician I/II 6.00 6.00
Environmental Compliance Inspector 3.00 3.00
Environmental Programs Coordinator 1.00 1.00
Executive Assistant 1.00 1.00
Facilities and Fleet Services Manager 1.00 1.00
Facility Maintenance Worker 4.00 4.00
Field Maintenance Manager 1.00 1.00
Fleet Services Supervisor 1.00 1.00
Instrument Control Technician 1.00 1.00
Laboratory Analyst I/II 4.00 4.00
Laboratory Supervisor 1.00 1.00
Laborer 1.00 1.00
Maintenance Planner 2.00 2.00
Maintenance Worker I/II 26.00 26.00
Management Analyst I/II 3.00 3.00
Principal Transportation Planner 1.00 1.00
Project Manager I/II 3.00 3.00
125
869 of 1111
Public Works

FULL TIME EQUIVALENT (FTE) PERSONNEL
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Public Works Maintenance Leadworker 3.00 3.00
Public Works Supervisor 4.00 4.00
Pump Station Mechanic I/II 3.00 3.00
Pump Station Mechanic III 1.00 1.00
Regulatory Compliance Manager 1.00 1.00
Senior Engineer 7.00 7.00
Senior Facility Maintenance Worker 3.00 3.00
Senior I&C Technician 1.00 1.00
Senior Management Analyst 1.00 1.00
Solid Waste and Recycling Program Coordinator 1.00 1.00 Solid Waste Technician 1.00 1.00
Traffic and Light Technician 2.00 2.00
Traffic Safety Worker 3.00 3.00
WWTP Electrical Technician 2.00 2.00
WWTP Maintenance Superintendent 1.00 1.00
WWTP Manager 1.00 1.00
WWTP Mechanic I/II 6.00 6.00
WWTP Mechanic III 2.00 2.00
WWTP Operations Superintendent 1.00 1.00
WWTP Operator In-Training/I/II 10.00 10.00
WWTP Operator III 5.00 5.00
WWTP Shift Supervisor 2.00 2.00
Waste Management Supervisor 1.00 1.00
Total Merit 160.00 160.00
Total Per Diem 6.04 6.04
Total Positions 166.04 166.04
126
870 of 1111

METRICS
Clean Water Program
Feet of sewer pipe rehabilitated annually
Number of Private Sewer Lateral Program applicants completing sewer lateral replacement Engineering Services - Capital Improvement Program
Citywide Pavement Condition Index (PCI)
Number of street miles in street inventory with PCI 30 or less Engineering Services - Transportation and Private Development Number of planning applications received
Percent of planning applications reviewed within 20 days Number of building permits received
Percent of building permits reviewed within 20 days
Percent of customer satisfaction score of 3 or higher at PW Counter (Scale: 1 - 5, 1 = Not Satisfied 5 = Extremely Satisfied) Facilities
Percent of graffiti removed from City facilities or Right of Way within 48 hours of reporting by contractor Percent of non-emergency rolling fleet that are sustainable Field Maintenance
Number of miles of sewer main cleaned
Percent of sewer pump stations inspected with quarterly preventative maintenance performed Number of sidewalk tripping hazards reported
Percentage of sidewalk tripping hazards addressed within 7 days (patch or barricade) Percent of traffic signals with semi-annual preventive maintenance performed Percent of streetlights with semi-annual preventative maintenance performed Number of Sanitary Sewer Overflows
Regulatory Compliance
Percent of regulatory requirements (reports) completed on schedule Percent trash reduction in storm water
Number of illegal dumping incidents reported
Wastewater Treatment Plant
Percentage of days per year the Wastewater Treatment Plant was in full compliance with water, air, and hazardous materials regulations Number of million gallons of wastewater treated at the City's wastewater treatment plant Cost of treatment at the City's wastewater treatment plant per millions of gallons Public Works
127
871 of 1111
Public Works
TYPE 2023-24

RESULTS
2024-25

ESTIMATE
2025-26
TARGET
2026-27
TARGET
Workload 28,000 28,000 7,000 7,000
Performance 150 100 100 100
Performance 72 73 73 73
Performance 7.86 <5 <5 <5
Workload 110 80 85 90
Performance 70% 80% 80% 80%
Workload 1,200 1,000 1,050 1,100
Performance 85% 85% 85% 85%
Performance 90% 90% 90% 90%
Performance 98% 98% 98% 98%
Performance 45% 47% 55% 65%
Workload 351 285 285 285
Performance 100% 100% 100% 100%
Workload 84 90 90 90
Performance 100% 100% 100% 100%
Performance 50% 100% 100% 100%
Performance 100% 100% 100% 100%
Workload <10  <12 <12 <10
Performance 100% 100% 100% 100%
Performance 90% 98% 100% 100%
Workload 2,809 2,800 2,300 2,300
Performance 100% 100% 100% 100%
Workload 4,000 3,800 3,800 3,800
Workload $ 3,500 $ 3,600 $ 3,600 $ 6,184
128
872 of 1111
Non-Departmental
129
873 of 1111
Non-Departmental

FINANCIALS
2024-25

ADJUSTED
BUDGET
2025-26

PROPOSED
BUDGET
Expenditures by Category
Operating $ 62,876,394 $ 68,750,147
Debt Service 29,127,341 34,688,132
Indirect & Overhead 613,526 647,702
Total Expenditures $ 92,617,261 $ 104,085,981
Funding Sources
General Funds $ 5,007,083 $ 6,121,556
Special Revenue Funds 97,064 5,958,707
Enterprise Funds 22,520,425 28,537,571
Internal Service Funds 59,096,394 63,468,147
Total Funding Sources $ 92,617,261 $ 104,085,981
Overview
In addition to expenditures that are directly related to departmental operations, there are also significant expenditures that are not directly attributable to the departments. The largest of the non-departmental expenditures is related to our internal services mechanism. To reflect the full cost of operations in departmental budgets, the cost of benefits (medical, dental, pension, etc.) and vehicle/equipment replacement is included in those budgets. To administer these programs in an efficient manner, the actual funds from each department are collected into a series of internal service funds, which consolidate the monies to pay for the benefits and vehicle/equipment replacements. Internal service fund expenses are not included in the total operating budget, as they are already incorporated into each department’s operations.

The second largest non-departmental expenditure reflects the City’s contribution to San Mateo Consolidated Fire Department (SMC Fire), a joint powers authority (JPA) between the City of Belmont, City of Foster City, and City of San Mateo, for fire services. Operations in SMC Fire commenced in January 2019, and in accordance with the JPA, its costs are allocated 20% each to Foster City and Belmont, and 60% to San Mateo. For 2025-26, the City’s contribution amounts to $31.0 million.

The non-departmental budget for 2025-26 also includes $7.7 million in net legacy costs for pension liability, workers’ compensation, and retiree medical related to retirees and former employees from the City’s fire operations that have transferred to SMC Fire. Combined with the contribution to SMC Fire, the City’s cost for fire services totals $38.7 million for 2025-26.

Another large non-departmental expenditure is the payment of debt service. This includes payment for the library general obligation bonds, golf bonds, sewer bonds, lease revenue bonds related to the funding of the police administration building, and lease revenue bonds for street and flood control improvements.

Finally, the General Fund contribution to the Comprehensive Liability Fund is included as part of non-departmental expenditures. The amount for 2025-26 is $4.4 million.
130
874 of 1111
Fund
Information
131
875 of 1111
Introduction
Other Funds
As noted previously, the City of San Mateo’s budget is organized on the basis of the fund accounting system, and each fund is considered a separate budgeting entity. For each fund, there is a ten-year financial plan, a five-year financial plan, or a two-year financial plan provided in this section of the budget document. In addition to the General Fund, whose ten-year plan is included in the Budget Overview section of this budget document, a ten-year plan has been created for the Sewer Enterprise Fund. Unlike the financial statements, which are done on an accrual accounting basis, the ten-year plan for the Sewer Enterprise Fund is done on a cash basis since cash flow is an essential component of the fund’s financial health.

Five-year financial plans have been created for the majority of special revenue funds, and all of the capital and internal service funds. The duration of five years was selected to be able to identify trends beyond the two-year budget cycle but not stretch the forecasting process out as far as was done with the Sewer Enterprise Fund. This duration will be evaluated annually, and if it is determined there is greater value to planning for a longer duration for some or all of these funds, the financial plans will be pushed out to ten years. For the grant special revenue funds, housing special revenue funds, and debt service funds, the financial plans were set at two years due to the nature of the funds themselves. Grant funding is typically evaluated and renewed on an annual basis, so long-term planning for grant funding has somewhat limited value.

Below is a summary table of all other funds and the duration of each fund’s financial plan:

FUND NAME FUND TYPE FINANCIAL PLAN DURATION
Police Grants and Safety Special Revenue 2 Years
Solid Waste Special Revenue 5 Years
HOME Special Revenue 2 Years
Community Development Block Grant Special Revenue 2 Years Advance Planning Special Revenue 5 Years
Construction Services Special Revenue 5 Years
Gas Tax Special Revenue 5 Years
City Housing Special Revenue 2 Years
Low & Moderate Income Housing Asset Special Revenue 2 Years Parks & Recreation Revenue Special Revenue 5 Years
Traffic Impact Fee Special Revenue 5 Years
Commercial Linkage Fee Special Revenue 5 Years
Road Maintenance & Rehabilitation Account Special Revenue 5 Years Permanent Local Housing Allocation Special Revenue 2 Years Landfill Special Revenue 2 Years
Street & Flood Control Projects Bond Debt Service 2 Years General Obligation Bonds Debt Service 2 Years
2% Hotel Tax Debt Service 5 Years
Sewer Enterprise 5 Years
Storm Enterprise 5 Years
Vehicle & Equipment Replacement Internal Services 5 Years Fleet & Building Maintenance Internal Services 5 Years
Benefits Internal Services 5 Years
Dental Internal Services 5 Years
Worker's Compensation Insurance Internal Services 5 Years Comprehensive Liability Internal Services 5 Years
132
876 of 1111
Special Revenue
133
877 of 1111
Police Grants and Safety Fund
Police Grants & Safety Fund 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
Beginning Fund Balance $ 392 $ 531 $ 557 $ 149
Revenues
Interest Earnings $ 15 $ 6 $ 6 $ 6
Asset Seizure 219 200 - -
State Grants 778 841 635 640
Other 181 426 561 333
Total Revenues $ 1,193 $ 1,472 $ 1,202 $ 979
Expenditures
Personnel $ 883 $ 863 $ 835 $ 810
Operating 78 487 699 297
Capital Outlay 93 97 77 -
Total Expenditures $ 1,054 $ 1,447 $ 1,610 $ 1,107
Ending Fund Balance $ 531 $ 557 $ 149 $ 20
Values are shown in thousands.

The purpose of the Police Grants and Safety Fund is to receive and track all Police Department grant revenue, asset forfeiture revenue, and corresponding expenditures in accordance with prescribed regulations. Revenues for this fund are comprised of state and federal asset forfeiture funds, and grant funds from sources such as the Citizens' Option for Public Safety Program's Supplemental Law Enforcement Services Funds (COPS/SLESF); the State Office of Traffic Safety (OTS) Grant; the State Department of Justice Tobacco Grant Program; and the State Organized Retail Theft (ORT) Prevention Grant Program.

The COPS/SLESF grant was established in 1996. Compliant cities are allocated a proportionate share of COPS funds by the State for the exclusive purpose of funding supplemental front line law enforcement services. Under the standard grant program allocation, the City of San Mateo is eligible to receive a minimum grant amount of $100,000 each year, with additional proportionate shares based on population estimates determined by the California Department of Finance. Funds for this program cannot supplant existing funding and are to be used for personnel and/or equipment. In the 2025-26 budget, proceeds from this grant will cover the cost of two partial traffic officer positions. While the COPS program is intended to be ongoing and permanent, there is no guarantee that continued funding will be available. However, the forecast assumes this fund will remain operating as usual.

The California Office of Traffic Safety (OTS) was created to administer funds and provide grants to both the San Mateo Police Department and regionally to San Mateo County for the purpose of reducing traffic deaths, injuries, and economic losses. Each year, eligible agencies compete for available funds by submitting proposals and although OTS does not have sufficient funds for all submissions, all proposals are reviewed against several criteria, including the potential traffic safety impact, collision statistics, seriousness of identified problems, and performance on previous grants. San Mateo has been a recipient of this grant annually since 1996. In the 2025-26 budget, proceeds from this grant will provide additional resources to combat impaired driving; enforce traffic laws; and conduct sobriety/driver license checkpoints, DUI saturation patrols, and targeted pedestrian/bicycle safety enforcement operations to help achieve the overarching goal of reducing injury traffic collisions.

The 2025-26 budget also reflects expenditures planned as a result of a grant awarded from the California Department of Justice for the Proposition 56 Tobacco Grant Program. This grant funds a Police Officer position focused on anti-vaping/tobacco enforcement, education and outreach activities. The total grant award is $651,800 to be expended over the course of three years. The 2025-2026 fiscal year will be the first full year of this grant award.

The Board of State and Community Corrections Organized Retail Theft (ORT) Prevention Grant Program was established in 2022, with funds designated in the Budget Act of 2022 (Senate Bill 154) as a competitive grant to support law enforcement agencies in preventing and responding to organized retail theft. The San Mateo Police Department collaborated with the Cities of Daly City and San Bruno to successfully apply for a share of these funds, and the City of San Mateo was awarded $1,533,802 to be expended over a three-year term, concluding in Fiscal year 2027. The funds are for a variety of strategies to combat retail theft such as conducting targeted security details, creating workspace/substations near retail, implementing new technologies and other programs.

The financial plan being presented represents the best estimate of grant revenues and the spending plan as of the update of the budget. Each aspect will be monitored and adjustments may be made as necessary to keep the fund's balance positive.
134
878 of 1111
Solid Waste Fund
Solid Waste 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 14,160 $ 14,423 $ 14,597 $ 13,477 $ 12,858 $ 12,167 $ 11,402 Revenues
Interest Earnings $ 706 $ 560 $ 160 $ 160 $ 160 $ 160 $ 160 Grants 106 11 60 - - - -
Service Charges 3,431 3,243 3,252 3,286 3,322 3,358 3,396 Other Revenues 50 187 266 272 277 283 289
Total Revenues $ 4,294 $ 4,001 $ 3,738 $ 3,718 $ 3,759 $ 3,802 $ 3,845 Expenditures
Personnel $ 1,764 $ 2,108 $ 2,158 $ 2,222 $ 2,287 $ 2,355 $ 2,425 Operating 1,534 1,413 1,747 1,783 1,820 1,859 1,898
Indirect and Overhead Charges 291 305 313 323 332 342 351 Capital Outlay 4 - 641 10 10 10 10
Total Expenditures $ 3,593 $ 3,827 $ 4,858 $ 4,337 $ 4,450 $ 4,566 $ 4,685 Transfer Out $ 437 $ - $ - $ - $ - $ - $ -
Ending Fund Balance $ 14,423 $ 14,597 $ 13,477 $ 12,858 $ 12,167 $ 11,402 $ 10,563 Values are shown in thousands.

The Solid Waste Fund accounts for garbage collection surcharge revenues, which are restricted by City ordinance to be used for street cleaning and waste management. The street cleaning aspect of this fund consists of keeping 204 curb miles of streets swept, as well as cleaning and maintaining City-owned parking lots. The waste management aspect of this fund involves the coordination and oversight of a range of programs and activities that provide the community with solid waste and recycling services.

Included in the service charges is $150,000 per year that the fund receives through the garbage collection provider for capital improvements related to the trash load reduction requirements of the Municipal Regional Plan issued by the Regional Quality Control Board. Fund balance has accumulated in this fund as expenditures have been lower than expected over the past several years. Going forward, services for street cleaning and waste management will continue to be evaluated to ensure that the level of support being provided is sufficient. Service charges will continue to be evaluated and adjusted as necessary to ensure alignment with expected expenditures and appropriate reserve levels. 135
879 of 1111
HOME Fund
HOME Fund 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
Beginning Fund Balance $ 403 $ 483 $ 497 $ 502
Revenues
Loan Payments $ 82 $ 15 $ 15 $ 15
Total Revenues $ 82 $ 15 $ 15 $ 15
Expenditures
Personnel $ 1 $ 1 $ - $ -
Operating $ - $ - $ 10 $ 10
Total Expenditures $ 1 $ 1 $ 10 $ 10
Ending Fund Balance $ 483 $ 497 $ 502 $ 507
Values are shown in thousands.

The HOME Investment Partnership (HOME) Program is a federal grant used to assist rental and homeownership housing opportunities for households up to 60-80% of the median income. The City received an annual HOME grant from 1994 to 2016. The fund now includes program income from loan repayments from loans funded with HOME monies in the past.

The program income from prior HOME loans will continue to be collected, and potential projects will be identified as the fund balance reaches an appropriate level.

Accumulated resources fund HOME-eligible uses, such as new construction of housing, acquisition and rehabilitation of existing buildings, and down payment assistance.
136
880 of 1111
Community Development Block Grant Fund
CDBG Fund 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
Beginning Fund Balance $ 405 $ 391 $ 549 $ 185
Revenues
Intergovernmental Contributions $ 181 $ 754 $ 732 $ 754 Loan Payments 22 8 8 8
Total Revenues $ 204 $ 762 $ 740 $ 762
Expenditures
Personnel $ 45 $ 25 $ 8 $ 28
Operating 155 342 461 364
Indirect & Overhead 18 19 19 20
Total Expenditures $ 218 $ 385 $ 487 $ 412
Transfer Out $ - $ 219 $ 617 $ 617
Ending Fund Balance $ 391 $ 549 $ 185 $ (82)
Values are shown in thousands.

The Community Development Block Grant (CDBG) Program is a federal grant from the Department of Housing and Urban Development (HUD) that provides flexible funding for community development projects and programs to assist lower income neighborhoods and households up to 80% of the median income. San Mateo has participated in this program since 1977. The fund consists of draws against the grant letter of credit, as well as program income from loan repayments from loans funded with CDBG in the past. The letter of credit consists of prior year unexpended funds in addition to the annual grant. These funds are held by HUD and drawn down on a reimbursement basis to the City.

For the next two years, CDBG funds will be used for Community Funding grants to local social service agencies who serve lower income residents, facility repairs for local service agencies, minor home repairs to lower income homeowners, pedestrian and bike improvementsin North Shoreview and North Central neighborhoods, and program administration.
137
881 of 1111
Advance Planning Fund
Advance Planning 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 5,105 $ 5,841 $ 6,071 $ 5,764 $ 5,284 $ 4,497 $ 3,661 Revenues
Interest Earnings $ 255 $ 100 $ 100 $ 100 $ 100 $ 100 $ 100 General Plan Maintenance Fee 1,744 1,000 1,700 1,500 1,500 1,500 1,500 State Grants 369 95 250 360 100 100 100
Total Revenues $ 2,368 $ 1,195 $ 2,050 $ 1,960 $ 1,700 $ 1,700 $ 1,700 Expenditures
Personnel $ 637 $ 956 $ 1,381 $ 1,439 $ 1,482 $ 1,526 $ 1,571 Operating 865 653 835 856 856 856 856
Indirect and Overhead Charges 130 137 141 145 150 154 159 Total Expenditures $ 1,632 $ 1,745 $ 2,357 $ 2,440 $ 2,487 $ 2,536 $ 2,586 Ending Fund Balance $ 5,841 $ 5,291 $ 5,764 $ 5,284 $ 4,497 $ 3,661 $ 2,775 Values are shown in thousands.

The Advance Planning Fund accounts for the General Plan maintenance fee collected through building permits and expenditures for activities related to preparing longterm plans and policy documents for the physical and economic development of the City, including the General Plan update. These plans and policies are used for the evaluation of development projects and determining priorities for public improvements.

Prior to 2021-2022, the Community Development Department increased the General Plan maintenance fee to account for the costs associated with several long-range planning efforts the City needs to complete. Advance Planning staff continues to monitor passage and implementation of new State legislation, the next iteration of the Sustainable Communities Strategy (Plan Bay Area) by the Association of Bay Area Governments and Metropolitan Transportation Commission, completing nearterm Zoning Code Amendments, preparation and adoption of the General Plan Update, creation of objective design standards for residential development, and implementation of general planning, zoning, and policy recommendations as directed by the City Council. In future cycles, the implementation of the General Plan Update and revision of the City’s various specific plans and zoning code will be funded by the Advance Planning Fund. 138
882 of 1111
Construction Services Fund
Construction Services 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 32,628 $ 26,934 $ 26,519 $ 20,559 $ 16,146 $ 12,973 $ 11,053 Revenues
Interest Earnings $ 1,609 $ 1,080 $ 450 $ 450 $ 450 $ 450 $ 450 Plan Check Fees 4,632 4,177 3,606 4,147 4,769 5,484 6,307 Permit Fees 4,868 6,099 4,886 5,618 6,461 7,430 8,545
Other Fees 533 553 526 605 696 800 920
Total Revenues $ 11,642 $ 11,909 $ 9,468 $ 10,820 $ 12,376 $ 14,165 $ 16,222 Expenditures
Personnel $ 7,730 $ 8,617 $ 10,335 $ 10,643 $ 10,961 $ 11,288 $ 11,626 Operating 2,404 1,187 2,660 2,201 2,101 2,208 2,330
Indirect & Overhead 1,402 1,470 1,513 1,588 1,667 1,749 1,836 Total Expenditures $ 11,536 $ 11,274 $ 14,507 $ 14,433 $ 14,729 $ 15,245 $ 15,792 Transfer Out $ 5,800 $ 1,050 $ 920 $ 800 $ 820 $ 840 $ 860 Ending Fund Balance $ 26,934 $ 26,519 $ 20,559 $ 16,146 $ 12,973 $ 11,053 $ 10,623 Values are shown in thousands.

The Construction Services Fund accounts for building permit revenues and expenditures for activities related to the review of private development projects to achieve high quality and long-term economic growth in the City. Building Division staff members also ensure that new construction meets established standards for health and safety, accessibility, energy efficiency, and provide public education to enhance the safety of existing buildings and better awareness of building codes.

Over the last several years, fund balance has grown significantly. Revenue in this fund is for services to be provided over time, and therefore, the significant fund balance will be needed over time to provide services for existing projects in process. While revenues in the five-year plan are expected to remain stable in the near term, service demand is expected to remain high to fully process existing projects. This is reflected in the ending fund balance being drawn upon over the course of the five-year plan.

Beginning in 2019-20, lease payments through a transfer out have been made to the General Fund for space occupied by construction services staff in City Hall.

Additionally, a number of funding commitments were made to transfer out to the Capital Improvement Projects Fund to support the digital storage of property records and electronic review of plans submittals, the traffic model update, and facilities improvements. 139
883 of 1111
Gas Tax Fund
Gas Tax 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 1,268 $ 1,768 $ 2,884 $ 2,973 $ 3,122 $ 3,334 $ 3,608 Revenues
State Gas Tax $ 1,931 $ 2,039 $ 2,059 $ 2,100 $ 2,142 $ 2,184 $ 2,228 Gas Tax In Lieu of Prop 42 962 1,004 990 1,010 1,030 1,051 1,072 Interest Earnings 66 40 40 40 40 40 40
Total Revenues $ 2,959 $ 3,084 $ 3,089 $ 3,150 $ 3,212 $ 3,275 $ 3,340 Transfer Out $ 2,458 $ 1,968 $ 3,001 $ 3,001 $ 3,001 $ 3,001 $ 3,001 Ending Fund Balance $ 1,768 $ 2,884 $ 2,973 $ 3,122 $ 3,334 $ 3,608 $ 3,948 Values are shown in thousands.

The Gas Tax Fund accounts for gasoline tax revenues that are utilized for street-related operating and capital costs. The fund makes an annual transfer to the General Fund to partially offset eligible operating costs related to the City's streets and roads maintenance programs. Additionally, it makes annual contributions to the Capital Improvement Projects Fund to fund various capital improvement projects.

California's gas tax is calculated on a per-gallon basis, not as a percentage of the fuel price. This means taxpayers pay a fixed amount in tax for every gallon purchased, regardless of fluctuations in fuel prices.

While fuel consumption has declined in recent years due to post-COVID hybrid work patterns, gas tax revenues have remained relatively stable thanks to scheduled rate increases tied to inflation. According to estimates from the State Department of Finance (DOF), the City anticipates receiving $3.1 million in gas tax revenues in both FY 2024-25 and FY 2025-26.

The five-year plan maintains the annual transfer to the General Fund, and makes contributions to the Capital Improvement Projects Fund to fund street reconstruction and rehabilitation projects. As more information becomes available on the impacts to gasoline tax revenues, this plan will be updated accordingly. 140
884 of 1111
City Housing Fund
City Housing Fund 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
Beginning Fund Balance $ 966 $ 1,198 $ 1,444 $ 1,256
Revenues
Housing Fees $ - $ 50 $ 50 $ 50
Interest Earnings - - - -
Miscellaneous 232 211 16 116
Total Revenues $ 232 $ 261 $ 66 $ 166
Expenditures
Contribution to Other Agencies $ - $ 15 $ 47 $ 45
Contribution to First Time Home Buyers - - 180 180
Operating - - 27 11
Total Expenditures $ - $ 15 $ 254 $ 236
Ending Fund Balance $ 1,198 $ 1,444 $ 1,256 $ 1,186
Values are shown in thousands.

The City Housing Fund captures a variety of housing-related revenues, including loan repayments from the defunct federal Rental Rehabilitation Program, a pro rata share of the original homebuyer loans at the Meadow Court housing complex, fees collected for housing loan subordination requests, and the fractional Below Market Rate (BMR) program in lieu fees.

This fund can be used to assist housing-related projects when the fund balance is sufficient and appropriate projects are identified. For the next two years, funds are set aside to assist first-time homebuyers on purchasing housing units that the City has acquired in order to retain their below market rate status. Additionally, funds will be used to pay for the City membership fee for The Housing Endowment and Regional Trust of San Mateo County (HEART), the countywide housing trust fund, and for revisions to the City's BMR documents.
141
885 of 1111
Low and Moderate Income Housing Asset Fund
Low and Moderate Income Housing Asset 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
Beginning Fund Balance $ 4,712 $ 5,135 $ 5,351 $ 5,275
Revenues
Interest Earnings $ 163 $ 75 $ 77 $ 80
Loan Payments 302 214 214 215
Total Revenues $ 464 $ 289 $ 291 $ 295
Expenditures
Personnel $ 35 $ 51 $ 47 $ 124
Operating 5 23 320 244
Total Expenditures $ 41 $ 74 $ 367 $ 368
Ending Fund Balance $ 5,135 $ 5,351 $ 5,275 $ 5,202
Vales are shown in thousands.

The Low and Moderate Income Housing Asset Fund consists of loan payments, lease payments, sale of property, and any other revenue generated from loans or assets held by the City as Housing Successor to the former Redevelopment Agency. State law regulates the use of these funds to support housing projects that assist households whose income ranges up to 80% of median income. The fund also consists of administrative costs to monitor existing housing projects, manage the existing loan portfolio, support homelss programs, and plan for new projects. 142
886 of 1111
Parks and Recreation Revenue Fund
Parks and Recreation Revenue Fund 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 12,286 $ 19,442 $ 3,780 $ 6,203 $ 7,121 $ 4,389 $ 6,156 Revenues
Interest Earnings $ 729 $ 187 $ 187 $ 187 $ 187 $ 187 $ 187 P&R Tax and Fees 7,477 265 4,505 2,700 2,700 2,700 2,700 Total Revenues $ 8,206 $ 452 $ 4,692 $ 2,887 $ 2,887 $ 2,887 $ 2,887 Expenditures
Operating $ 17 $ 18 $ 18 $ 19 $ 19 $ 20 $ 21
Total Expenditures $ 17 $ 18 $ 18 $ 19 $ 19 $ 20 $ 21
Transfer Out $ 1,033 $ 16,097 $ 2,250 $ 1,950 $ 5,600 $ 1,100 $ 2,000 Ending Fund Balance $ 19,442 $ 3,780 $ 6,203 $ 7,121 $ 4,389 $ 6,156 $ 7,023 Values are shown in thousands.

The Parks and Recreation Revenue Fund accounts for parks and recreation tax, park impact fees, and park in-lieu fees. Revenue projections are based on residential building projects, and are thus dependent on development activity. Accumulated resources in this fund are utilized to fund parks and recreation related projects through a transfer to the Capital Improvement Projects Fund.

Major transfers planned for 2025-26 include a contribution to the Central Park Master Plan. Transfers planned beyond 2025-26 include citywide play area improvements, a downtown dog park, and repairs to the Japanese Garden. If the estimated fees do not come to fruition, we will not be able to transfer as much as planned to the Capital Improvement Projects Fund. We will adjust our plan in the future years to align spending with funding capacity. 143
887 of 1111
Traffic Impact Fee Fund
Traffic Impact Fee 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 316 $ 56 $ (2,653) $ (2,153) $ (1,563) $ (589) $ (452) Revenues
Interest Earnings $ 15 $ - $ - $ - $ - $ - $ -
Traffic Impact Fees 773 2,428 1,350 1,440 1,824 286 2,895 Total Revenues $ 788 $ 2,428 $ 1,350 $ 1,440 $ 1,824 $ 286 $ 2,895 Transfer Out $ 1,047 $ 5,137 $ 850 $ 850 $ 850 $ 150 $ 150 Ending Fund Balance $ 56 $ (2,653) $ (2,153) $ (1,563) $ (589) $ (452) $ 2,293 Values shown in thousands.

The Traffic Impact Fee Fund accounts for revenues that are collected to fund various capital projects to mitigate the traffic related cumulative impacts of new development. Revenues from this fund have contributed to traffic calming projects, construction costs of new traffic signals, and infrustructure projects such as the 25th Ave. Grade Separation Project, which was completed in 2021, and the Railroad Avenue Wall Enhancement project. In the five-year Capital Improvement Plan, transfers are being made to fund bicycle projects and the Citywide Traffic Calming project.

Since the Traffic Impact Fees are closely related to the status of new development projects, this revenue source is difficult to project. If the funding projections do not come to fruition, the capital improvement projects programmed to be funded out of this revenue source will be reviewed and evaluated for proper funding and adjustments will have to be made in the out years of this five-year forecast. 144
888 of 1111
Commercial Linkage Fee Fund
Commercial Linkage Fee 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 3,246 $ 3,405 $ (550) $ 1,959 $ 6,469 $ 11,478 $ 11,987 Revenues
Interest Earnings $ 164 $ 50 $ 50 $ 50 $ 50 $ 50 $ 50
Commercial Linkage Fee - - 2,500 4,500 5,000 500 500
Total Revenues $ 164 $ 50 $ 2,550 $ 4,550 $ 5,050 $ 550 $ 550 Expenditures
Operating $ 5 $ 5 $ 40 $ 41 $ 41 $ 41 $ 41
Total Expenditures $ 5 $ 5 $ 40 $ 41 $ 41 $ 41 $ 41
Transfer Out $ - $ 4,000 $ - $ - $ - $ - $ -
Ending Fund Balance $ 3,405 $ (550) $ 1,959 $ 6,469 $ 11,478 $ 11,987 $ 12,496 Values shown in thousands.

The Commercial Linkage Fee is an assessment on new commercial developments to address the impacts of new job creation on housing availability and affordability for workers. Developers pay a fee based on square footage of new commercial space depending on type of use: office, retail, or hotel. The funds are to be used for housing programs to assist workers who make up to 120% of the area median income. Examples of housing programs can include acquisition, rehabilitation, or new construction of housing.

The fund balance is being accumulated over the period of this forecast. Potential projects will be identified as the fund balance reaches an appropriate level.

Accumulated resources will be utilized to fund projects through a transfer to the Capital Improvement Projects Fund, and this plan will be updated accordingly. 145
889 of 1111
Road Maintenance and Rehabilitation Account
Road Maintenance and
Rehabilitation Account
2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 4,611 $ 7,493 $ 1,805 $ 2,013 $ 2,312 $ 2,708 $ 3,205 Revenues
Road Maint. and Rehabilitation $ 2,729 $ 2,764 $ 2,863 $ 2,949 $ 3,038 $ 3,129 $ 3,223 Interest Earnings 250 146 45 50 58 68 80
Total Revenues $ 2,979 $ 2,910 $ 2,908 $ 2,999 $ 3,096 $ 3,197 $ 3,303 Transfer Out $ 98 $ 8,598 $ 2,700 $ 2,700 $ 2,700 $ 2,700 $ 2,700 Ending Fund Balance $ 7,493 $ 1,805 $ 2,013 $ 2,312 $ 2,708 $ 3,205 $ 3,807 Values are shown in thousands.

The Road Maintenance and Rehabilitation Account (RMRA) Fund was created in 2020-21. It accounts for transportation taxes established by the Road Repair and Accountability Act of 2017 (SB 1). Prior to 2020-21, RMRA revenues were deposited in the Gas Tax Fund, and then subsequently transferred to the Capital Improvement Projects Fund to fund eligible projects. Moving this revenue source into its own special revenue fund creates greater visibility to available resources for projects and will allow for more efficient reporting on how these funds are being utilized.

Based on the State Department of Finance (DOF) estimates, staff anticipates that the RMRA revenues will be approximately $2.9 million for FY 2025-26. Accumulated resources from the RMRA revenues will be utilized to fund street reconstruction and rehabilitation projects through a transfer to the Capital Improvement Projects (CIP) Fund. In the five-year plan, the annual transfers to CIP are estimated at $2.7 million each year.
146
890 of 1111
Permanent Local Housing Allocation Fund
PERMANENT LOCAL HOUSING ALLOCATION FUND 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2025-26
Forecast
Beginning Fund Balance $ 3 $ 10 $ 10 $ 10
Revenues
Interest Earnings $ 7 $ - $ - $ -
State Grants 305 293 225 300
Total Revenues $ 312 $ 293 $ 225 $ 300
Expenditures
Personnel $ 27 $ 15 $ 9 $ 15
Operating $ 278 $ 278 $ 216 $ 285
Total Expenditures $ 305 $ 293 $ 225 $ 300
Ending Fund Balance $ 10 $ 10 $ 10 $ 10
Values are shown in thousands.

The Permanent Local Housing Allocation (PLHA) is a State Grant that is provided to the City, starting in Fall 2020, that will continue on an annual basis based on actual State receipts of document recording fees. These funds are flexible as long as they are used for housing-related projects and programs that assist in addressing the unmet housing needs of San Mateo.

The fund supports four programs to support housing security and availability in the City: an emergency shelter, a homesharing program, supportive services at the Montara affordable housing development, and a rapid rehousing program. 147
891 of 1111
Landfill Fund
LANDFILL 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
Beginning Fund Balance $ 3,954 $ 4,490 $ 4,496 $ 3,955
Revenues
Interest Earnings $ 210 $ 80 $ 80 $ 80
Garbage Collection Surcharge 450 600 600 600
Total Revenues $ 660 $ 680 $ 680 $ 680
Expenditures
Personnel $ 33 $ 45 $ 45 $ 47
Operating 55 98 56 61
Total Expenditures $ 88 $ 143 $ 101 $ 108
Transfer Out $ 36 $ 530 $ 1,120 $ -
Ending Fund Balance $ 4,490 $ 4,496 $ 3,955 $ 4,527
Values are shown in thousands.

The Landfill Fund was initially set up as a debt service fund to account for debt service payments for the landfill revenue bonds. Since the landfill bonds have been paid off, starting in fiscal year 2024-25, the Landfill Fund has been reclassiflied to a special revenue fund. Surcharge revenues collected will be reviewed and adjusted in future years to reflect the reduction of the debt service obligation.

The Landfill Fund will continue to maintain a fund balance that is sufficient to meet the City's landfill closure and post-closure obligations. 148
892 of 1111
Debt Service
149
893 of 1111
Street & Flood Control Project Bond
STREET & FLOOD CONTROL PROJECTS BOND 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
Beginning Fund Balance $ 14 $ 30 $ 30 $ 26
Revenues
Interest Earnings $ 16 $ 5 $ 5 $ 5
Total Revenues $ 16 $ 5 $ 5 $ 5
Expenditures
Operating $ 63 $ 65 $ 67 $ 67
Debt Service 2,629 2,629 2,632 2,633
Total Expenditures $ 2,692 $ 2,695 $ 2,699 $ 2,700
Transfer In $ 2,692 $ 2,690 $ 2,690 $ 2,690
Ending Fund Balance $ 30 $ 30 $ 26 $ 21
Values are shown in thousands.

The City has two debt service funds: the Street and Flood Control Projects Bond Fund and the General Obligation Bonds Fund.

The Street and Flood Control Projects Bond Fund is a debt service fund that accounts for debt service payments on lease revenue bonds issued in 2020 to finance the street and flood control improvement projects. As these improvements are part of the Measure S initiatives, revenues from Measure S are transferred into this fund to administer the debt services. Additionally, a benefit assessment district was created in the North Shoreview neighborhood as it relates to the flood control improvements. Assessment levies are collected to pay part of the annual debt. The remaining debt service is funded by the Measure S. 150
894 of 1111
General Obligation Bonds
GENERAL OBLIGATION BONDS 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
Beginning Fund Balance $ 6,647 $ 7,562 $ 7,040 $ 6,493
Revenues
Interest Earnings $ 298 $ 120 $ 120 $ 120
Property Taxes 2,725 1,482 1,470 1,590
Total Revenues $ 3,023 $ 1,602 $ 1,590 $ 1,710
Expenditures
Operating $ 60 $ 62 $ 65 $ 68
Debt Service 2,049 2,062 2,072 2,065
Total Expenditures $ 2,109 $ 2,124 $ 2,136 $ 2,133
Ending Fund Balance $ 7,562 $ 7,040 $ 6,493 $ 6,070
Values are shown in thousands.

The General Obligation Bonds Fund accounts for voter-approved property tax revenues and debt service payments on the City's general obligation bonds that were utilized to finance the construction, acquisition, and improvement of a new main library and the improvement of the City's branch libraries.

Other debt of the City is housed directly in the applicable operating and capital funds, with payments for debt service listed as a line item in the financial plans.

The City is bound by a provision in state law limiting the indebtedness for California cities to 15% of the assessed value of all real and personal property of the city.

Based on the current fiscal year's total assessed value of $36 billion, San Mateo's legal debt limit was $5.4 billion, only at 0.30% of its legal debt limit. This statutory limitations applies only to bonded indebtedness of the City payable from proceeds of taxes levied on a property. For San Mateo, this includes only the general obligation bonds.
151
895 of 1111
2% Hotel Tax Fund
2% Hotel Tax 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 259 $ 179 $ 257 $ 249 $ 214 $ 167 $ 108 Revenues
Interest Earnings $ 14 $ 2 $ 2 $ 2 $ 2 $ 2 $ 2
Transient Occupancy Tax 888 625 637 650 662 675 688
Total Revenues $ 901 $ 626 $ 639 $ 652 $ 664 $ 677 $ 690 Expenditures
Operating $ 145 $ 76 $ 138 $ 141 $ 146 $ 151 $ 156
Debt Service 836 822 860 895 915 935 955
Total Expenditures $ 981 $ 898 $ 998 $ 1,036 $ 1,061 $ 1,086 $ 1,111 Transfer In $ - $ 350 $ 350 $ 350 $ 350 $ 350 $ 350
Ending Fund Balance $ 179 $ 257 $ 249 $ 214 $ 167 $ 108 $ 38 Values are shown in thousands.

The 2% Hotel Tax Fund accounts for the Measure C voter-approved 2% hotel tax revenue, the related transfers to the Capital Improvement Program Fund, and the debt service on the variable rate bonds that were utilized to partially fund the police administration facility.

Due to the closure of a major hotel in May 2024, we have adjusted the revenue projections. Hotel taxes are expected to decrease from $1.0 million to $0.5 million by the end of fiscal year 2024-25 with moderate growth in the following years. Additionally, rising interest costs from variable rate bonds pose further challenges.

Consequently, ongoing support from the General Fund, approximately $350,000 annually, will be required to maintain a positive fund balance. 152
896 of 1111
Enterprise
153
897 of 1111
Sewer Fund
Sewer Fund (CASH BASIS) 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 196,290 $ 184,575 $ 294,963 $ 296,443 $ 297,960 $ 291,356 $ 298,196 Revenues
Interest Earnings $ 9,343 $ 6,450 $ 5,000 $ 5,000 $ 5,000 $ 5,000 $ 5,000 Operating Revenues 82,501 82,953 86,806 89,287 91,870 94,555 97,341 Capital Contributions from Other 7,860 3,369 3,915 3,993 4,073 4,154 4,236 Total Revenues $ 99,704 $ 92,772 $ 95,721 $ 98,280 $ 100,943 $ 103,709 $ 106,577 Expenses
Operating and Maintenance $ 27,442 $ 26,533 $ 36,758 $ 38,490 $ 39,351 $ 40,439 $ 41,554 Debt Service 289,182 15,851 27,843 29,227 30,601 30,996 30,147 Capital Projects 90,275 60,000 29,639 29,047 37,595 25,434 31,362 Total Expenses $ 406,899 $ 102,384 $ 94,240 $ 96,763 $ 107,547 $ 96,869 $ 103,062 Loan Proceeds $ 295,479 $ 120,000 $ - $ - $ - $ - $ -
Transfer Out $ - $ - $ - $ - $ - $ - $ -
Ending Fund Balance $ 184,575 $ 294,963 $ 296,443 $ 297,960 $ 291,356 $ 298,196 $ 301,710 Values are shown in thousands.

The Sewer Fund consists of the sewer collection systems, the Wastewater Treatment Plant (WWTP), and disposal facilities serving the residents and businesses of San Mateo, Foster City, and portions of the neighboring communities of Hillsborough, Belmont, the Crystal Springs County Sanitation District, and certain unincorporated areas of the County. The sewer enterprise system currently serves approximately 30,000 customer accounts in the City and approximately 11,000 customer accounts in Foster City and the subregional customer communities utilizing the WWTP.

The fund's financial plan consists of two elements: (1) fiscal year (FY) 2024-25 proposed operating budget and forecast of future operational needs, and (2) estimated cash inflows and outflows for sewer capital improvement projects (CIP) during the forecast period. The capital expenses identified in this financial plan, as well as the corresponding bond/loan proceeds, are predominantly related to the execution of the Clean Water Program, which is discussed in detail in the Capital Improvement Program section of this document. The financial plan will be continually monitored and this plan will be updated accordingly.

Background information about the Sewer Service Charge:

In 2018, the City Council adopted a five-year sewer rate structure for fiscal years 2018-19 through 2022-23 designed to provide sufficient revenues to fund ongoing operations and capital projections. The 50/50 volumetric/fixed fee structure was implemented. The new rate structure introduced a fixed monthly fee to better stabilized revenue and help address revenue reductions due to increased water conservation. A recent Sewer Rate Study found that the past rate increases have put the City's sewer fund in a good financial position. Additionally, the City has been successful in getting a large amount of the Clean Water Program financed with low interest rate loans. As a result, only inflationary level rate increases will be required for future years. In July 2023, the City Council approved an annual sewer rate increase of 3.0% for the next five years, starting FY 2023-24 through FY 2027-28. 154
898 of 1111
Storm Water Fund
Storm Enterprise
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ - $ 1,737 $ 1,229 $ 3,735 $ 6,767 $ 9,989 Revenues
Charges for Services $ 4,000 $ 4,096 $ 4,219 $ 4,346 $ 4,476 $ 4,610 Interest Earnings 50 120 20 70 140 200
Total Revenues $ 4,050 $ 4,216 $ 4,239 $ 4,416 $ 4,616 $ 4,810 Expenditures
Personnel $ 281 $ 375 $ 385 $ 395 $ 405 $ 416
Operating 231 300 273 279 279 279
Capital - 650 25 10 10 10
Total Expenditures $ 513 $ 1,324 $ 683 $ 684 $ 694 $ 705 Transfer Out $ 1,800 $ 3,400 $ 1,050 $ 700 $ 700 $ 700
Ending Fund Balance $ 1,737 $ 1,229 $ 3,735 $ 6,767 $ 9,989 $ 13,394 Values are shown in thousands.

The City of San Mateo operates and maintains a stormwater system, which provides vital services to safeguard neighborhoods from flooding and protects local waterways from pollution. The system consists of complex infrastructure including surface drains, underground pipes and conduits, pump stations, creeks and channels, and the Marina Lagoon. The City's stormwater system requires improvements to address flood control capacity limitations and deficiencies related to aging infrastructure, enhanced operations and maintenance, and improvements to minimize pollutants in stormwater runoff as required by state and federal mandates.

In January 2024, the Community Flood and Storm Protection Fee Ballot Measure was approved by property owners. This measure allows the City Council to levy the Stormwater Fees starting in FY 2024-25, providing an estimated $4.0 million in the first fiscal year. The fees may be adjusted annually by the Consumer Price Index (CPI) up to 3%, subject to annual approval by the City Council.

Additionally, the City aims to complete the Stormwater Master Plan by the end of calendar year 2025. This plan will assess the current state of our stormwater system, recommend improvements, and prioritize projects and resources based on their urgency. The Master Plan will also assess the costs of capital projects and help establish a cash flow forecast to plan for financing the necessary capital improvements to our stormwater infrastructure. Once the plan is finalized, staff will update the budget accordingly to incorporate the new work plans. 155
899 of 1111
Internal Services
156
900 of 1111
Vehicle and Equipment Replacement
Vehicle and Equipment Replacement 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 18,769 $ 18,126 $ 18,495 $ 8,494 $ 8,547 $ 10,500 $ 8,456 Revenues
Interest Earnings $ 598 $ 318 $ 370 $ 170 $ 171 $ 210 $ 169 Interfund Replacement Collection 1,897 1,844 1,839 1,862 1,918 1,976 2,035 Other Revenues 77 5 - - - - -
Total Revenues $ 2,572 $ 2,166 $ 2,209 $ 2,032 $ 2,089 $ 2,186 $ 2,204 Expenses
Vehicle Replacement $ 10 $ 429 $ 4,469 $ 1,272 $ 143 $ 2,541 $ 700 Computer Replacement 1,191 365 22 36 121 191 904
Radio Replacement - - 673 - - - -
Major Equipment Replacement 233 83 6,655 282 282 1,909 578 Other Capital Outlay & Depreciation 1,278 34 - - - - -
Total Expenses $ 2,711 $ 912 $ 11,820 $ 1,590 $ 546 $ 4,640 $ 2,183 Transfer In $ 410 $ 410 $ 410 $ 410 $ 410 $ 410 $ 410
Transfer Out $ 914 $ 1,296 $ 800 $ 800 $ - $ - $ -
Ending Fund Balance $ 18,126 $ 18,495 $ 8,494 $ 8,547 $ 10,500 $ 8,456 $ 8,888 Reserve for Major Building Component Replacemen $ 2,460 $ 2,870 $ 3,280 $ 3,690 $ 4,100 $ 4,510 $ 4,920 Remaining Fund Balance $ 15,666 $ 15,625 $ 5,214 $ 4,857 $ 6,400 $ 3,946 $ 3,968 Values are shown in thousands.

The Vehicle and Equipment Replacement Fund accounts for charges to user departments to fund the replacement of vehicles and equipment. This includes vehicles, computers, radios, furniture, and other major equipment. Funds for future replacement are collected while vehicles and equipment are in service so that when it is time for replacement, adequate funds are available. Accumulated fund balance in this fund is estimated to be over $8 million at the end of fiscal year 2025-26. Unlike the Fleet and Building Maintenance Fund, which is entirely an operating fund and doesn't require a significant fund balance, the Vehicle and Equipment Replacement Fund should have a significant fund balance by nature. Because of that, funds will accumulate over time for replacement.

This fund collects annually from the operating departments, so it is also important that the amount of available fund balance considers this. To that end, a long-term spending plan is an important tool for managing this type of fund. Understanding spending needs over the short- and long-term and factoring in fund balance allows the City to set a collection amount that ensures funding is available when vehicles and equipment need to be replaced, but does not maintain such a large fund balance that creates an unneccesary burden on the other funds, particularly the General Fund. This five-year plan captures the long-term spending plans for each of the replacement categories, and sets future collections to ensure funding for replacements is available and fund balance is set at an appropriate level.

The five-year plan further captures a portion of the fund balance that is reserved for major building component replacements. Since 2017-18, the General Fund has transferred $410,000 each year to this reserve and in 2022-23, the Sewer Fund contributed $294,000. As the reserve balance reaches an appropriate level and major building replacement projects are identified, the accumulated funds will be utilized to fund the projects through a transfer to the Capital Projects Fund, and this plan will be updated accordingly.
157
901 of 1111
Fleet and Building Maintenance
Fleet and Building Maintenance 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 838 $ 196 $ 649 $ 544 $ 599 $ 818 $ 1,213 Revenues
Charges to Dept. - Building $ 3,566 $ 3,566 $ 3,816 $ 4,045 $ 4,247 $ 4,459 $ 4,682 Charges to Dept. - Fleet 1,846 2,205 2,317 2,456 2,579 2,708 2,844 Other Revenues 6 8 8 8 8 8 8
Total Revenues $ 5,418 $ 5,779 $ 6,140 $ 6,508 $ 6,834 $ 7,175 $ 7,533 Expenses
Personnel $ 1,698 $ 1,718 $ 2,265 $ 2,310 $ 2,357 $ 2,404 $ 2,452 Operating 3,911 3,136 3,495 3,643 3,743 3,846 3,952
Indirect & Overhead 452 471 485 500 515 530 546
Total Expenses $ 6,061 $ 5,325 $ 6,245 $ 6,453 $ 6,614 $ 6,780 $ 6,950 Ending Fund Balance $ 196 $ 649 $ 544 $ 599 $ 818 $ 1,213 $ 1,796 Values are shown in thousands.

The Fleet and Building Maintenance Fund accounts for charges to user departments and the related expenses for maintaining City vehicles and facilities. This fund is primarily operational, with vehicle and equipment replacement costs tracked separately in a dedicated internal service fund. As such, charges to user departments should be set to closely match anticipated expenses, and there is generally no need to maintain a large fund balance. In recent years, expenses have outpaced revenues, prompting a gradual increase in departmental charges to ensure the fund remains financially stable and maintains an appropriate level of reserves.
158
902 of 1111
Benefits Fund
Benefits
2 0
2 2
2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 554 $ 1,084 $ (297) $ (36) $ 265 $ 606 $ 992 Revenues
Internal Service Charge - Pension $ 27,421 $ 29,313 $ 31,378 $ 33,040 $ 34,410 $ 37,120 $ 37,860 Internal Service Charge - Social Security/Medicare 3,575 3,476 4,147 4,271 4,399 4,531 4,667 Internal Service Charge - Healthcare 9,321 10,861 10,911 11,641 12,354 13,140 13,909 Internal Service Charge - Severance Trust 1,327 1,513 1,352 1,420 1,491 1,566 1,644 Internal Service Charge - Other 2,873 2,897 3,268 3,327 3,387 3,448 3,510 Total Revenues $ 44,516 $ 48,060 $ 51,055 $ 53,699 $ 56,041 $ 59,805 $ 61,591 Expenses
Pension $ 27,417 $ 30,987 $ 31,378 $ 33,040 $ 34,410 $ 37,120 $ 37,860 Social Security/Medicare 3,575 3,476 4,147 4,271 4,399 4,531 4,667 Healthcare 9,247 11,186 10,830 11,560 12,273 13,059 13,828 Severance Trust 1,045 1,101 1,273 1,298 1,324 1,350 1,377 Other 2,702 2,690 3,166 3,229 3,293 3,359 3,426
Total Expenses $ 43,986 $ 49,441 $ 50,794 $ 53,398 $ 55,700 $ 59,419 $ 61,159 Ending Fund Balance $ 1,084 $ (297) $ (36) $ 265 $ 606 $ 992 $ 1,424 Values are shown in thousands.

The Benefits Fund accounts for the collection of funds from operating departments to cover the cost of employee benefits. The expenses covered by this fund include pension, social security/medicare, retiree healthcare, the City's payment for medical premiums for active employees, funding for the severance trust (to pay for the cashout of unused vacation to employees who retire or otherwise leave the City), as well as a few other benefit costs, such as life insurance and long-term disability insurance. In some cases, the cost of providing these benefits is known and collections can be set accordingly. For example, the normal cost of pensions is set as a percentage of pay, so collections can be set based on that percentage of pay. In other cases, such as for the funding of the severance trust, the cost is an estimate based on historical actuals, but will fluctuate annually based on different factors. Thus, to accommodate the fluctuation of expenses like those related to the severance trust, the fund should maintain some level of fund balance. To that end, collections for the various components of this fund have been set to collect costs to fund the programs adequately while maintaining a level of fund balance that allows for the year-over-year fluctuations without requiring a transfer from the General Fund.

The largest expense category in this fund is related to pension expenses. As discussed in detail in the Budget Overview section of the budget document, pension expenses are expected to increase significantly over the next five to seven years as the result of a number of factors. These increases will continue to put pressure on the operating funds, as a larger and larger percentage of the budget will be required to cover pension cost increases.

After the transfer of the City's fire operations to SMC Fire in 2018-19, with the exception of the Bureau of Fire Protection and Life Safety (Bureau), what remains as the City's responsibility is the former fire department employees' unfunded pension liability and retiree health benefits, as those costs are attributable to years of service to the City. These legacy costs are transferred from the General Fund and administered through this fund. Bureau activities are designed to be full cost recovery, so with the transition to SMC Fire, legacy pension costs for former Bureau personnel are the responsibility of SMC Fire.

Fund balance was at a low of $1.1 million at the end of fiscal year 2023-24. Staff has adjusted the collection rates for the following years in the the five-year plan. The long-term forecast has the fund building back up its fund balance gradually.

Actual expenses will be analyzed over time and annual collections will be adjusted accordingly. 159
903 of 1111
Dental Fund
Dental 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 999 $ 935 $ 999 $ 923 $ 837 $ 740 $ 632 Revenues
Internal Service Charges $ 752 $ 784 $ 779 $ 802 $ 826 $ 851 $ 877 Total Revenues $ 752 $ 784 $ 779 $ 802 $ 826 $ 851 $ 877 Expenses
Insurance Premiums $ 816 $ 720 $ 855 $ 888 $ 923 $ 959 $ 997 Total Expenses $ 816 $ 720 $ 855 $ 888 $ 923 $ 959 $ 997 Ending Fund Balance $ 935 $ 999 $ 923 $ 837 $ 740 $ 632 $ 512 Values are shown in thousands.

The Dental Self-Insurance Fund accounts for the City's self-insurance activities related to the dental plan the City provides its employees. Collections for this fund are made by charging departments a flat amount for each employee. Expenses in this fund consist almost entirely of the premiums the City pays on behalf of its employees for dental coverage. As actual expenses are analyzed over time, annual collections amounts will be adjusted accordingly. 160
904 of 1111
Workers' Compensation Insurance Fund
Workers' Compensation Insurance 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ 6,391 $ 7,595 $ 6,539 $ 4,968 $ 3,309 $ 1,593 $ 1,317 Revenues
Interest Earnings $ 979 $ 400 $ 400 $ 400 $ 400 $ 400 $ 400 Internal Service Charges 4,383 4,299 2,500 2,500 2,500 4,000 4,250 Total Revenues $ 5,363 $ 4,699 $ 2,900 $ 2,900 $ 2,900 $ 4,400 $ 4,650 Expenses
Personnel $ 403 $ 439 $ 441 $ 454 $ 467 $ 481 $ 495
Operating 637 693 1,403 1,474 1,514 1,556 1,599
Claims 1,243 2,500 2,500 2,500 2,500 2,500 2,500
Indirect Costs 117 123 127 131 135 139 143
Acturial Adjustment 1,758 - - - - - -
Total Expenses $ 4,159 $ 3,755 $ 4,471 $ 4,559 $ 4,616 $ 4,676 $ 4,737 Transfer Out $ - $ 2,000 $ - $ - $ - $ - $ -
Ending Fund Balance $ 7,595 $ 6,539 $ 4,968 $ 3,309 $ 1,593 $ 1,317 $ 1,230 Values are shown in thousands.

The Workers' Compensation Insurance Fund accounts for all workers' compensation self-insurance activities. This includes the cost of claims, insurance, legal and other professional services, and program administration. The total cost of claims constitutes the largest expense in this fund. Workers' compensation expenses can fluctuate significantly year-over-year based on the total cost of claims, which includes any adjustments to the total liability of the fund due to actuarially-determined changes in experience. Over the past 10 years, total expenses (excluding acturial accounting adjustment) have been as high as $4.3 million and as low as $1.6 million.

Funding for the Workers' Compensation Insurance Fund comes from collections from all of the operations across all funds that include personnel. Departments are charged a percentage of pay for each employee, and the amount of the charge depends on the type of employee. Positions that historically have higher workers' compensation experience, such as sworn-in police employees, are charged a higher rate than positions with historically lower experience. Collections from departments are set in an effort to ensure adequate funding for this program, including having funds set aside in reserve to cover years where claims expenses are unusually high.

In 2019-20, the fund received a $3.5 million transfer from the General Fund to prevent the fund from going further into a negative balance. However, based on the latest actuarial study, this General Fund support is no longer needed. As such, the excess $1.5 million was transferred out to support the Comprehensive Liability Fund in fiscal year 2021-22, and the remaining $2.0 million was transferred out to the Comprehensive Liability Fund in 2024-25.

When the City transferred its fire operations to San Mateo Consolidated Fire Department (SMC Fire), the department established its own Worker's Compensation Fund.

However, claims that were incurred while the Fire employees were City employees will remain in this fund and continue to be the City's responsiblility, with the exception of former Fire personnel that served in the Bureau of Fire Protection and Life Safety (Bureau), as it is a cost recovery program. While SMC Fire has paid the City for the present value of former Bureau legacy workers' compensation, which reflects open claims and claims that have been closed since SMC Fire commencement of operations, updated analysis and cost assignment may be needed as updated actuarial studies are performed in subsequent fiscal years. To that end, the City will prepare an annual analysis to 1) compare actuarial assumptions to the current actuarial study, including the discount rate or cost of healthcare, 2) evaluate new claims if the City is assigned proportional responsiblity.
161
905 of 1111
Comprehensive Liability Insurance Fund
Comprehensive Liability Insurance 2023-24
Actuals
2024-25
Estimated
Actuals
2025-26
Proposed
Budget
2026-27
Forecast
2027-28
Forecast
2028-29
Forecast
2029-30
Forecast
Beginning Fund Balance $ (12,057) $ (2,423) $ (974) $ (958) $ (1,017) $ (1,006) $ (975) Revenues
Interfund Charges $ 2,793 $ 3,700 $ 5,200 $ 5,980 $ 6,578 $ 6,907 $ 7,252 Investment/Interest Earnings 72 - - - - - -
Misc. Revenues 2 - - - - - -
Total Revenues $ 2,866 $ 3,700 $ 5,200 $ 5,980 $ 6,578 $ 6,907 $ 7,252 Expenses
Personnel $ 149 $ 208 $ 194 $ 200 $ 206 $ 212 $ 218
Insurance Premiums 2,300 3,109 4,100 4,920 5,412 5,683 5,967 Claims 1,118 200 250 250 250 250 250
Attorney's Fees 910 906 430 452 475 500 525
Other Costs 325 249 210 217 224 231 238
Actuarial Adjustment (10,570) (321) - - - - -
Total Expenses $ (5,768) $ 4,350 $ 5,184 $ 6,039 $ 6,567 $ 6,876 $ 7,198 Transfer In $ 1,000 $ 2,100 $ - $ - $ - $ - $ -
Ending Fund Balance $ (2,423) $ (974) $ (958) $ (1,017) $ (1,006) $ (975) $ (921) Values are shown in thousands.

The Comprehensive Liability Insurance Fund accounts for the City's general liability program. Expenses in this fund primarily consist of insurance premiums, the cost of claims, legal and other professional services, and program administration.

For FY 2025-26, this program is budgeted at $5.2 million, an increased of $1.1. million from the prior year, primarily due to rising insurance premiums. Over the past ten years, the City's general liability insurance premium has increased by an average 23% annually, rising from $0.6 million in FY 2016-17 to the projected $4.1 million in 2025-26. If this trend continues, insurance premiums could reach $6.0 ~ $7.0 million by 2029-30, pushing the total program costs beyond $8.0 million annually.

Although interfund charges (cost recovery revenues) have been increased, more is needed to cover future costs. As indicated in the five-year forecast, the fund is projected to end fiscal year 2025-26 with a negative fund.

To help stabilize the fund, the City redirected $3.5 million in one-time General Fund support that was originally allocated to the Workers’ Compensation Fund (Fund 870). Based on the latest actuarial report, those funds were no longer needed in Fund 870 and therefore were transferred to the Comprehensive Liability Fund (Fund 880), $1.5 million in FY 2023-24 and $2.0 million in FY 2024-25.

The California public entity insurance marketplace has been changing dramatically in recent years, and public agencies throughout the state are seeing a significant increase in plaintiff demands and high dollar liability claims. Areas of concern include wildfires, dangerous conditions, road design, intersections, sidewalks, and public safety services. Future insurance costs will be determined by the loss run experience for the City’s General Liability Program. It is anticipated that insurance premiums will remain high for the next few years before any reduction is seen. 162
906 of 1111
Five-Year Capital
Improvement Program
163
907 of 1111
CIP Summary
As part of the Capital Improvement Program (CIP) budget process, departments develop project requests that capture the five-year capital project needs. Total project costs are developed, and funding sources are identified where possible. For capital projects that have been completed, any related ongoing operation or maintenance costs are included in the respective operating budgets. New and ongoing capital projects are prioritized and recommended for funding based on a review and analysis by a committee made up of the City Manager, Assistant City Manager, Public Works Director, Parks and Recreation Director, and Finance Director.

Sections 65400, 65401, and 65403 of the California Planning and Land Use Government Code require the City’s governing body, planning, or public works commission to review public works projects proposed for the fiscal year to determine conformity with the adopted General Plan. The City Council reviews the Capital Improvement Program Budget at a study session annually in April, with the full five-year CIP program presented as part of the overall budget adoption process in June. During these meetings, the Council reviews the City’s five-year CIP recommendations, which are listed in the schedules that follow this narrative, to determine if the proposed capital projects are in conformance with the goals, policies, and actions contained within the General Plan.

The five-year CIP totals $270.0 million, with $61.5 million for 2025-26. Immediately following this narrative is a list of all the capital projects funded in the 2025-30 CIP (“Funded Projects”). In addition, the table below summarizes the five-year CIP by type of capital projects.

CAPITAL PROJECTS
2025-26

PROPOSED
BUDGET
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-Year
TOTAL
Bikeway/Pedestrian $ 4,098,820 $ 5,563,636 $ 1,575,000 $ 865,000 $ 865,000 $ 12,967,456 Bridges 75,000 75,000 75,000 - - 225,000
Facilities 5,878,742 4,310,000 3,360,000 4,010,000 6,575,000 24,133,742 Parks 6,391,822 2,695,000 6,345,000 1,845,000 2,625,000 19,901,822 Sanitary Sewer and
Wastewater
Management
29,089,000 28,996,805 37,544,930 25,384,035 31,311,652 152,326,422 Stormwater 250,000 1,050,000 700,000 700,000 700,000 3,400,000 Street Lights 700,000 1,000,000 - - - 1,700,000
Streets 9,240,473 8,818,000 9,003,000 8,203,000 8,203,000 43,467,473 Traffic 1,325,000 550,000 350,000 1,050,000 350,000 3,625,000 Other City Capital
Projects 4,492,000 1,002,000 927,000 927,000 927,000 8,275,000 Total $ 61,540,856 $ 54,060,441 $ 59,879,930 $ 42,984,035 $ 51,556,652 $270,021,914 Of the total $270.0 million, $152.3 million (56.4% of the total five-year CIP) is for Clean Water Program capital projects, all of which are funded by sewer service charges, bond and loan proceeds, and capital payments from the sewer system’s subregional customers and the City of Foster City. More details of this significant infrastructure investment are provided in the following section. Street rehabilitation/reconstruction and transportation projects total $61.8 million (22.9% of the total five-year CIP), while parks-related projects amount to $19.9 million (7.4% of the total).
164
908 of 1111
CIP Summary
Wastewater Capital Improvement Projects
The Sewer Enterprise system consists of the City’s sewer collection system and wastewater treatment plant (WWTP) facilities serving the residents and businesses of the City, all of Foster City, the Crystal Springs County Sanitation District (CSCSD), and portions of the neighboring communities (subregional customers) of the Town Hillsborough, City of Belmont, and certain unincorporated areas of San Mateo County. The current population in the utility’s service area is approximately 150,000 residents. There are approximately 28,500 customer accounts in the City and approximately 11,000 customer accounts in Foster City and the subregional customer communities utilizing the WWTP.

Significant Sewer Infrastructure Needs and the Cease and Desist Order Similar to many wastewater systems in the region, the City’s Sewer Enterprise infrastructure is aging and in need of significant rehabilitation and upgrade. The City’s sewer collection system dates back to the early 1900s, with the majority of sewer pipes installed in the 1940s through 1960s. The original structures at the WWTP were constructed in 1937. The City’s collection system has challenges with infiltration and inflow through leaky pipes and illegal drain connections. During significant rain events, flow into the sewer pipes increases, exceeding the capacity of the sewer collection system and WWTP. These conditions result in overflows of diluted and untreated sewage onto streets and into storm drains, which eventually reaches the City’s local waterways and San Francisco Bay. These events are termed sanitary sewer overflows (SSOs).

Due to past incidents of SSOs into the City’s local waterways and San Francisco Bay, the San Francisco Bay Regional Water Quality Control Board (Regional Board) issued a Cease and Desist Order (CDO) in 2009, mandating the City to implement measures to reduce and prevent SSOs. The National Pollutant Discharge Elimination System permit for the WWTP also requires the City to ensure full treatment at the WWTP of all effluent and eliminate “blending” practices.

In December 2014, the City established the Clean Water Program to address the Regional Board’s CDO and comply with Wastewater Treatment Plant operation permit requirements. The Clean Water Program is a 10-year, approximately $1 billion, comprehensive capital improvement plan to address the needs for both the collection system and the WWTP. These improvements are focused on replacing aging infrastructure, providing wet weather capacity assurance, meeting current and anticipated future regulatory requirements, and aligning with the City’s sustainability goals. The City’s Sewer Enterprise continues to invest in its capital and operating budgets for staff and consultant engineering services to execute the Clean Water Program improvements.

The Clean Water Program’s largest capital improvement project is the WWTP Upgrade and Expansion project, building new treatment facilities that increase capacity, ensure full treatment of effluent, and eliminate blending practices. As of August 2020, all three phases of the WWTP Upgrade and Expansion construction contract were awarded. The first phase is for excavation and site preparation, the second phase is to build the foundation, and the third phase is to construct the facilities. The project is anticipated to be completed by Summer 2026. 165
909 of 1111
CIP Summary
The largest collection system capital improvement project is the Basins 2 & 3 Collection System Improvements project, which includes the Underground Flow Equalization System (UFES) project. The UFES project consists of an underground 5.3-million-gallon structure that provides in-stream storage capacity to help eliminate SSOs in San Mateo and comply with the CDO. The special use permit and the project environmental impact report were approved in October 2019. The construction contract was awarded in May 2020 and final completion of the project is anticipated in 2025.

Sewer Capital Project Revenues
The City is utilizing a number of funding and financing options for the Clean Water Program. These include federal Water Infrastructure Finance and Innovation Act (WIFIA) loan funds, State Revolving Fund (SRF) loan funds, revenue bonds, direct funding from sewer fees, and capital contributions from Foster City/Estero Municipal Improvement District (EMID) and the subregional customers. Sewer fees will pay the debt service on these various financing mechanisms.

The City, through the San Mateo – Foster City Public Financing Authority (Authority) with Foster City/Estero Municipal Improvement District (EMID), has received significant funding through SRF and WIFIA loans for the wastewater treatment plant upgrade and expansion project. In November 2020, the Authority finalized a WIFIA loan for the WWTP for $277 million and in December 2020, the City finalized a second WIFIA loan for its Basins 2 and 3 Collection System Improvement project for $85 million. An SRF loan of $137 million was finalized in early May 2022. The City’s efforts to pursue and execute these low interest loan agreements resulted in hundreds of millions of dollars in savings to the ratepayers.

Sewer Capital Projects and Costs
Of the total $270.0 million planned over the next five years, four capital projects are planned for the City’s WWTP totaling an estimated $80.0 million. The largest planned WWTP project is $44.2 million for the WWTP Annual Repairs project, followed by $25.0 million for the WWTP Upgrade and Expansion project, and $10.9 million for annual major components.

Sewer collection system improvements total an estimated $72.3 million, with ten different capital projects throughout the City. The largest sewer collection system project is $34.7 million for the Annual Sanitary Sewer Rehabilitation project, followed by $22.0 million for Sanitary Sewer Pump Station Upgrades and $12.5 million for the TMDL (Total Maximum Daily Load) Enhanced Planning and Infrastructure Improvements.

Street Rehabilitation and Improvement Capital Projects
A total of $43.5 million in street rehabilitation, reconstruction, and improvement projects are included in the fiveyear CIP. Primary funding sources for these projects include Road Maintenance and Rehabilitation Account Fund ($13.5 million), Measure A countywide half-cent sales tax ($12.9 million), Gas Tax ($6.0 million), Measure W countywide half-cent sales tax ($4.3 million), Measure S local quarter-cent sales tax ($4.0 million), Measure M countywide vehicle license fee revenue ($1.8 million), and Street and Flood Control Bonds ($0.5 million). 166
910 of 1111
CIP Summary
The City’s Pavement Management Program (PMP) uses available funding to minimize deferred maintenance, reduce the failed streets inventory, and maintain the City’s streets with a Pavement Condition Index (PCI) above 70. While the PMP focuses on the management of the City’s entire pavement assets, a separate Smooth Streets Program (SSP) was created in 2013 to address a specific set of failed streets. Street segments with a PCI of less than 25 are considered “failed” by common industry practice, and generally require expensive, full street reconstruction to restore. Of the 17 miles identified as failed streets and five miles identified as at-risk,

15.7 miles have been restored and 3.6 miles are currently in construction. The remaining 2.7 miles of failed streets/at-risk streets in the Smooth Streets Program are currently scheduled for completion by the end of calendar year 2026.

City Building and Facilities Improvement Capital Projects Many City facilities are aging and facing significant upgrade needs. In the five-year CIP plan, a total of $24.1 million is planned for various building facilities improvements and new construction. Of this total, $2.5 million is added to complete the Marina Library Branch modernization and structure improvement project; $3.0 million is for roof replacement and improvements, $7.0 million of this total is for waterproofing, painting, and structural improvements, and $6.0 million is for interior improvements at various City facilities. Additional projects include fence and picnic area improvements, play court resurfacing, and paving and resurfacing at the Corporation Yard and various recreation centers.

Bridge Maintenance and Improvement Capital Projects
Of the total $0.2 million planned over the next five years for bridge-related capital improvements, $75,000 is planned for the Gateway Park Pedestrian Bridge Improvements project and $150,000 is for citywide bridge maintenance.

Parks and Recreation Facilities Renovation & Rehabilitation Capital Projects A total of $19.9 million in parks and recreation capital improvement projects are planned for the next five years.

Of the total planned, the largest parks project is $4.7 million programmed to upgrade citywide park play areas.

Additional funding planned for parks and recreation projects includes $2.7 million for the improvements at the Joinville Pool, $2.3 million for the replacement of playground equipment at City parks, and $2.2 million for improvements to the Laurelwood Park playground.

Of the $19.9 million total of planned projects, the majority ($12.9 million) are funded from parks and recreationrelated taxes and fees. The City has received significant parks and recreation-related taxes and fees from the development projects currently underway in the City, which has allowed for the capacity to program the large projects in the five-year CIP.
167
911 of 1111
CIP Summary
Stormwater / Flood Control Renovation & Rehabilitation Capital Projects A total of $3.4 million is planned for storm drainage and flood control projects for the next five years. Projects in this category include $1.6 million for the Green Stormwater Infrastructure Program, $1.3 million for the recurring work under the Storm System Minor Repair project, and $1.1 million for storm system dredging. Due to change of project design and scope of work, unused funds from certain stormwater projects have been released to support other projects. Staff is updating the City’s Storm Drain Master Plan in 2025, which will identify and prioritize capital improvement needs that will be programmed into future five-year Capital Improvement Program budgets.

Once the master plan is complete, a financing plan will be developed to fund the priority projects.

Bikeway / Pedestrian Walkway Capital Projects
A total of $13.0 million is planned for bikeway and pedestrian walkway projects. Of the total, notable project requests include $4.8 million is planned for the Fashion Island Class IV bike lane, $2.3 million is for the Bike San Mateo Program, $2.3 million is for pedestrian, street and bike infrastructure from Community Development Block Grant (CDBG) funding, $1.5 million is for the Delaware Safe Routes to School Corridor project, and $1.0 is for the Citywide Safe Routes to School Program.

Traffic Capital Projects
A total of $3.6 million is planned for congestion management and neighborhood traffic requests. Of this amount, the larger projects include $0.9 million, $0.7 million, and $0.5 million for two traffic signal projects at the intersections of Alameda De Las Pulgas/Barneson, Peninsula/Delaware, and Hillsdale/Alameda, respectively, $0.8 million is for citywide traffic calming, and $0.4 million for neighborhood traffic management.

The primary funding sources for these traffic-related projects are Measure A ($1.6 million), traffic impact fees ($0.8 million), Measure CC ($0.7 million), Measure S ($0.4 million), and Gas Tax ($0.3 million).

Streetlights Capital Projects
The High Voltage Streetlight Conversion project replaces approximately 450 existing high voltage streetlights with lower voltage, LED streetlights. The project has been implemented in phases and is expected to be completed in 2026. This entire project is funded by the General Fund with $1.7 million in funding planned during the five-year CIP.

Other City Capital Projects
Various other citywide capital projects are planned, totaling $8.3 million over the next five years. Of this amount, the largest projects include $2.3 million for childcare facilities and $1.3 million for electronic and digital services improvements for the Community Development Department.
168
912 of 1111
CIP Summary
CIP Funding
All the projects listed in the following “Funded Projects” sub-section have identified sources of funding. The reports following separate the funded projects by category and by funding source.

The City also has many capital projects that have no identified source of funding. The “Unfunded Projects” subsection lists all the identified projects that have no funding allocated and their estimated total costs. These unfunded capital projects have high-level cost estimates that would need to be further refined at the point of becoming a funded project with a total estimated cost $ 352.0 million. The size and scope of the projects varies and includes major construction projects, such as $50.0 million for Central Park Improvements Phases 2-4, $32 million for a new Central Park Parking Garage and $20 million for the 2nd and El Camino Parking Garage, $26 million for a new corporation yard facility, $20 million for the renovation of the King Resiliency Center, and $11 million for a new Fire Station #27, and other various projects including 31 projects from the Bike Master Plan totaling $13.1 million and six projects associated with storm catchment area improvements totaling $56.5 million. 169
913 of 1111
CIP Projects by Category
170
914 of 1111
CIP Projects by Category

PROJECT NAME
2025-26

PROPOSED
BUDGET
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-YEAR
TOTAL
Bikeway/Pedestrian
101/92 MULTI-MODAL (FASHION ISLAND CLASS IV BIKE LANE) $ 831,819 $ 3,988,636 $ - $ - $ - $ 4,820,455 BIKE SAN MATEO PROGRAM 902,000 700,000 700,000 - - 2,302,000 CDBG PROJECTS 450,000 450,000 450,000 450,000 450,000 2,250,000 CITYWIDE BICYCLE PARKING - 10,000 10,000 - - 20,000
CITYWIDE SAFE ROUTES TO SCHOOL PROGRAM 200,000 200,000 200,000 200,000 200,000 1,000,000 CITYWIDE SIDEWALK REPAIR PROGRAM 115,000 115,000 115,000 115,000 115,000 575,000 DELAWARE SAFE ROUTES TO SCHOOL CORRIDOR 1,500,000 - - - - 1,500,000 QUICK BUILD MOBILITY PROGRAM 100,000 100,000 100,000 100,000 100,000 500,000 Bikeway/Pedestrian Total $ 4,098,819 $ 5,563,636 $ 1,575,000 $ 865,000 $ 865,000 $ 12,967,455 Bridges -
CITYWIDE BRIDGE MAINTENANCE $ - $ 75,000 $ 75,000 $ - $ - $ 150,000 GATEWAY PARK PEDESTRIAN BRIDGE IMPROVEMENTS 75,000 - - - - 75,000 Bridges Total $ 75,000 $ 75,000 $ 75,000 $ - $ - $ 225,000 Facilities -
ADA COMPLIANCE AND TRANSITION PLANNING $ 250,000 $ 35,000 $ 35,000 $ 35,000 $ - $ 355,000 ADA ENTRY COMPLIANCE - BERESFORD 18,766 - - - - 18,766
CHILDCARE FACILITY IMPROVEMENTS 150,000 - - 250,000 - 400,000 CITYWIDE FACILITY INTERIOR IMPROVEMENTS - 400,000 400,000 800,000 800,000 2,400,000 CITYWIDE FACILITY ROOF REPLACEMENTS 1,000,000 800,000 100,000 100,000 1,000,000 3,000,000 CITYWIDE FACILITY WATERPROOFING IMPROVEMENTS 475,000 1,000,000 1,000,000 1,000,000 1,000,000 4,475,000 CITYWIDE FENCE IMPROVEMENTS 100,000 100,000 100,000 100,000 100,000 500,000 CITYWIDE FIRE - INTRUSION ALARM SYSTM UPGRADE 250,000 250,000 250,000 250,000 250,000 1,250,000 CITYWIDE PICNIC AREA IMPROVEMENTS 50,000 50,000 50,000 50,000 50,000 250,000 CITYWIDE PLAY COURT RESURFACING 350,000 350,000 350,000 350,000 350,000 1,750,000 CORP YARD MISCELLANEOUS IMPROVEMENTS 100,000 100,000 100,000 100,000 100,000 500,000 CORPORATION YARD PAVING 500,000 500,000 - - - 1,000,000 DISPATCH FACILITY IMPROVEMENT - - - 500,000 - 500,000
DOWNTOWN PARKING IMPROVEMENTS 100,000 100,000 100,000 100,000 100,000 500,000 DOWNTOWN RESTROOMS 25,000 25,000 25,000 25,000 25,000 125,000 EXTERNAL RADIO INFRASTRUCTURE (200,000) - - - - (200,000) FIRE STATION 24 SHOWER REMODEL (144,000) - - - - (144,000) LAURELWOOD PARK RETAINING WALL REPAIR 150,000 - - - 2,000,000 2,150,000 MAIN LIBRARY IMPROVEMENTS 100,000 - - - - 100,000
MARINA LIBRARY STRUCTURAL IMPROVEMENTS 2,250,000 250,000 - - - 2,500,000 OLD FIRE STATION 25 RENOVATION - - - - 800,000 800,000

PARKING LOT RESURFACING (SHORELINE/LAKESHORE/LOS
PRADOS/BERESFORD) 300,000 300,000 300,000 300,000 - 1,200,000 POLICE DEPARTMENT ROOF DRAINAGE IMPROVEMENTS 3,818 - - - - 3,818 POLICE JAIL RETROFIT - - 500,000 - - 500,000
RECREATION CENTER BACKUP GENERATOR CONNECTION 50,000 50,000 50,000 50,000 - 200,000 Facilities Total $ 5,878,584 $ 4,310,000 $ 3,360,000 $ 4,010,000 $ 6,575,000 $ 24,133,584 Parks
BOREL PARK DEVELOPMENT $ (801,185) - - - - (801,185)
CENTRAL PARK 750,000 - - - - 750,000
CITYWIDE EMERGENCY FIELD LIGHTING 120,000 120,000 120,000 120,000 - 480,000 CITYWIDE PARK PLAY AREA UPGRADE 500,000 100,000 2,000,000 100,000 2,000,000 4,700,000 CITYWIDE PLAYGROUND EQUIPMENT REPLACEMENT 450,000 450,000 450,000 450,000 450,000 2,250,000 DOWNTOWN DOG PARK - 500,000 500,000 - - 1,000,000
GOLF BUNKERS - - 850,000 - - 850,000
GOLF IRRIGATION CONTROLLERS & MAINLINE - - 50,000 1,000,000 - 1,050,000 JAPANESE GARDEN REPAIRS 350,000 650,000 - - - 1,000,000 JOINVILLE POOL ASSESSMENT & IMPROVEMENTS 2,650,000 - - - - 2,650,000 KING & JOINVILLE CHANGING ROOM IMPROVEMENTS (103,670) - - - - (103,670) 171
915 of 1111
CIP Projects by Category

PROJECT NAME
2025-26

PROPOSED
BUDGET
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-YEAR
TOTAL
Parks (Continued)
LAURELWOOD PARK PLAYGROUND - - 2,200,000 - - 2,200,000
LOS PRADOS COURT LIGHTING IMPROVEMENT 300,000 - - - - 300,000 PARK RESTROOM PHASE V (55,539) - - - - (55,539)
PARK RESTROOM REFURBISHMENT PHASE IV 164,601 - - - - 164,601 PARKS AMENITIES ASSESEMENT - 600,000 - - - 600,000
PARKSIDE AQUATIC PLAY AREA 600,000 - - - - 600,000
RYDER PARK WATER FEATURE FILTRATION SYSTEM 50,000 100,000 - - - 150,000 SEAL POINT PARK POND H2S INVESTIGATION AND
REMEDIATION 120,000 - - - - 120,000
SPORTS FIELDS CONVERSION: SYNTHETIC TURF (400,000) - - - - (400,000) SYNTHETIC FIELD REPLACEMENT 1,500,000 - - - - 1,500,000 TREE PLANTING - PARKS DIVISION 175,000 175,000 175,000 175,000 175,000 875,000 WASHINGTON PARK BASKETBALL COURT 22,615 - - - - 22,615
Parks Total $ 6,391,822 $ 2,695,000 $ 6,345,000 $ 1,845,000 $ 2,625,000 $ 19,901,822 Sewer -
ANNUAL SANITARY SEWER REHABILITATION $ - $ 7,120,000 $ 10,350,000 $ 8,500,000 $ 8,755,000 $ 34,725,000 COLLECTION SYSTEM ODOR CONTROL 200,000 200,000 200,000 200,000 200,000 1,000,000 CWP ANNUAL CITYWIDE SANITARY SEWER REHAB (5,331,000) - - - - (5,331,000) CWP CCTV INSPECTION PROGRAM 409,000 - - - - 409,000
CWP SEWER FLOW MONITORING & REPORTING (172,000) - - - - (172,000) CWP WWTP ANNUAL MAJOR COMPONENTS 5,487,000 5,365,000 - - - 10,852,000 EAST SAN MATEO LIFT STATION 1,563,000 - - - - 1,563,000 PROGRAM MANAGEMENT - SEWER PROJECTS (874,000) - - - - (874,000) ROOT FOAMING 450,000 450,000 450,000 450,000 450,000 2,250,000 SANITARY SEWER CCTV INSPECTION PROGRAM - 900,000 800,000 900,000 1,200,000 3,800,000 SANITARY SEWER FLOW MONITORING & REPORTING - 125,000 125,000 125,000 125,000 500,000 SANITARY SEWER PUMP STATION UPGRADES - 5,257,000 5,420,000 5,588,000 5,755,000 22,020,000

TMDL ENHANCED PLANNING & INFRASTRUCTURE
IMPROVEMENTS 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 12,500,000 WWTP & FLOW MANAGEMENT UPGRADE & EXPANSION 24,957,000 - - - - 24,957,000 WWTP ANNUAL REPAIRS - 7,079,805 17,699,930 7,121,035 12,326,652 44,227,422 WWTP PAVING (100,000) - - - - (100,000)
Sewer Total $ 29,089,000 $ 28,996,805 $ 37,544,930 $ 25,384,035 $ 31,311,652 $ 152,326,422 Stormwater
CITYWIDE SOIL STABILIZATION PROGRAM $ 400,000 $ 150,000 $ 150,000 $ 150,000 $ 150,000 $ 1,000,000

COLUMBIA/CRYSTAL SPRINGS STORM DRAIN
IMPROVEMENTS (2,000,000) - - - - (2,000,000)
COYOTE PARK/POPLAR PUMP STATION 50,000 - - - - 50,000
GREEN STORMWATER INFRASTRUCTURE PROGRAM 500,000 500,000 200,000 200,000 200,000 1,600,000 MARINA LAGOON DREDGING DESIGN/PERMITTING 150,000 50,000 - - - 200,000 STORM DRAIN CONDITION ASSESSMENT 550,000 100,000 100,000 100,000 100,000 950,000 STORM SYSTEM DREDGING 1,100,000 - - - - 1,100,000
STORM SYSTEM MINOR REPAIR 250,000 250,000 250,000 250,000 250,000 1,250,000 TRASH CAPTURE AT POPLAR AND MONTE DIABLO (750,000) - - - - (750,000) Stormwater Total $ 250,000 $ 1,050,000 $ 700,000 $ 700,000 $ 700,000 $ 3,400,000 Street Lights
HIGH VOLTAGE STREET LIGHT CONVERSION $ 700,000 $ 1,000,000 $ - $ - $ - $ 1,700,000 Street Lights Total $ 700,000 $ 1,000,000 $ - $ - $ - $ 1,700,000 Streets
CITYWIDE SIGN INVENTORY AND REPLACEMENT $ - $ 150,000 $ 150,000 $ 150,000 $ 150,000 $ 600,000 CITYWIDE STREET RECONSTRUCTION FY18-19 (570,501) - - - - (570,501) CITYWIDE STREET RECONSTRUCTION PACKAGE 1 275,000 - - - - 275,000 CITYWIDE STREET RECONSTRUCTION PACKAGE 2 174,473 - - - - 174,473 CITYWIDE STREET RECONSTRUCTION PACKAGE 3 870,501 - - - - 870,501 CITYWIDE STREET REHABILITATION FY18-19 (160,000) - - - - (160,000) CITYWIDE STREET REHABILITATION PACKAGE 1 (303,000) - - - - (303,000) 172
916 of 1111
CIP Projects by Category

PROJECT NAME
2025-26

PROPOSED
BUDGET
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-YEAR
TOTAL
Streets (Continued)
CITYWIDE STREET REHABILITATION PACKAGE 2 (600,000) - - - - (600,000) CITYWIDE STREET REHABILITATION PACKAGE 3 (205,117) - - - - (205,117) CITYWIDE STREET REHABILITATION PROGRAM 9,284,117 8,468,000 8,853,000 8,053,000 8,053,000 42,711,117 COMPLETE STREETS NORTH CENTRAL 150,000 - - - - 150,000
COMPLETES STREETS PLAN 100,000 - - - - 100,000
LOCAL ROADWAY SAFETY PLAN IMPLEMENTATION PLAN - 200,000 - - - 200,000 PENINSULA CORRIDOR COMPLETE STREETS 225,000 - - - - 225,000 Streets Total $ 9,240,473 $ 8,818,000 $ 9,003,000 $ 8,203,000 $ 8,203,000 $ 43,467,473 Traffic

ALAMEDA DE LAS PULGAS & BARNESON INTERSECTION
SAFETY 7 OPTIMIZATION $ - $ 200,000 $ - $ 700,000 $ - $ 900,000 CITYWIDE TRAFFIC CALMING 150,000 150,000 150,000 150,000 150,000 750,000 CITYWIDE TRAFFIC SIGNAL RETIMING - 25,000 25,000 25,000 25,000 100,000 GRAMMERCY DRIVE RETAINING WALL 50,000 50,000 50,000 50,000 50,000 250,000 HILLSDALE/ALAMEDA DE LAS PULGAS SIGNAL 450,000 - - - - 450,000 NEIGHBORHOOD TRAFFIC MANAGMENT - 100,000 100,000 100,000 100,000 400,000 PENINSULA/DELAWARE SAFETY IMPROVEMENT 650,000 - - - - 650,000

REGIONAL AND CITYWIDE TRANSPORTATION PROGRAM
MANAGEMENT 25,000 25,000 25,000 25,000 25,000 125,000
Traffic Total $ 1,325,000 $ 550,000 $ 350,000 $ 1,050,000 $ 350,000 $ 3,625,000 Other City Capital Projects
CDBG COMMUNITY FACILITIES $ 40,000 $ 40,000 $ 40,000 $ 40,000 $ 40,000 $ 200,000 CDD OFFICE REMODEL 140,000 - - - - 140,000
CDD SERVICE IMPROVEMENT - ELECTRONIC & DIGITAL 250,000 250,000 250,000 250,000 250,000 1,250,000 CHILD CARE FACILITIES 450,000 450,000 450,000 450,000 450,000 2,250,000 HOUSING REHABILITATION 60,000 60,000 60,000 60,000 60,000 300,000 LANDFILL MAINTENANCE 1,000,000 - - - - 1,000,000
MINOR HOME REPAIR 127,000 127,000 127,000 127,000 127,000 635,000

PEG PROJECT (PUBLIC, EDUCATIONAL, AND
GOVERNMENTAL ACCESS CHANNELS) 750,000 - - - - 750,000
POLICE FACILITY INTERNET EXPANSION 200,000 - - - - 200,000 POLICE STATION: UPS REPLACEMENT 400,000 - - - - 400,000 TRAIN QUIET ZONE 1,075,000 75,000 - - - 1,150,000
Other City Capital Projects Total $ 4,492,000 $ 1,002,000 $ 927,000 $ 927,000 $ 927,000 $ 8,275,000 Grand Totals $ 61,540,698 $ 54,060,441 $ 59,879,930 $ 42,984,035 $ 51,556,652 $ 270,021,756 173
917 of 1111
CIP Projects by Funding
Source
174
918 of 1111
CIP Projects by Funding Source
2025-26

PROPOSED
BUDGET
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-Year
TOTAL
Gas Tax
CITYWIDE BICYCLE PARKING $ - $ 10,000 $ 10,000 $ - $ - $ 20,000 CITYWIDE STREET REHABILITATION PROGRAM 1,203,000 1,193,000 1,193,000 1,203,000 1,203,000 5,995,000 GRAMMERCY DRIVE RETAINING WALL 50,000 50,000 50,000 50,000 50,000 250,000 Gas Tax Total $ 1,253,000 $ 1,253,000 $ 1,253,000 $ 1,253,000 $ 1,253,000 $ 6,265,000 General Fund
ADA COMPLIANCE AND TRANSITION PLANNING $ 250,000 $ 35,000 $ 35,000 $ 35,000 $ - $ 355,000 ADA ENTRY COMPLIANCE - BERESFORD 18,766 - - - - 18,766
BOREL PARK DEVELOPMENT (801,185) - - - - (801,185)
CITYWIDE EMERGENCY FIELD LIGHTING 120,000 120,000 120,000 120,000 - 480,000 CITYWIDE FACILITY INTERIOR IMPROVEMENTS - 400,000 400,000 800,000 800,000 2,400,000 CITYWIDE FACILITY ROOF REPLACEMENTS 200,000 - 100,000 100,000 1,000,000 1,400,000 CITYWIDE FACILITY WATERPROOFING IMPROVEMENTS 475,000 1,000,000 1,000,000 1,000,000 1,000,000 4,475,000 CITYWIDE FENCE IMPROVEMENTS 100,000 100,000 100,000 100,000 100,000 500,000 CITYWIDE FIRE - INTRUSION ALARM SYSTM UPGRADE 250,000 250,000 250,000 250,000 250,000 1,250,000 CITYWIDE PICNIC AREA IMPROVEMENTS 50,000 50,000 50,000 50,000 50,000 250,000 CITYWIDE PLAYGROUND EQUIPMENT REPLACEMENT 450,000 450,000 450,000 450,000 450,000 2,250,000 CITYWIDE SIDEWALK REPAIR PROGRAM 115,000 115,000 115,000 115,000 115,000 575,000 CITYWIDE STREET REHABILITATION FY18-19 (160,000) - - - - (160,000) CITYWIDE STREET REHABILITATION PACKAGE 3 (205,117) - - - - (205,117) CITYWIDE STREET REHABILITATION PROGRAM 205,117 - - - - 205,117

COLUMBIA/CRYSTAL SPRINGS STORM DRAIN
IMPROVEMENTS (750,000) - - - - (750,000)
CORP YARD MISCELLANEOUS IMPROVEMENTS 50,000 50,000 50,000 50,000 50,000 250,000 CORPORATION YARD PAVING - 500,000 - - - 500,000
DOWNTOWN PARKING IMPROVEMENTS 100,000 100,000 100,000 100,000 100,000 500,000 DOWNTOWN RESTROOMS 25,000 25,000 25,000 25,000 25,000 125,000 FIRE STATION 24 SHOWER REMODEL (144,000) - - - - (144,000) HIGH VOLTAGE STREET LIGHT CONVERSION 700,000 1,000,000 - - - 1,700,000 JOINVILLE POOL ASSESSMENT & IMPROVEMENTS 2,650,000 - - - - 2,650,000 LAURELWOOD PARK RETAINING WALL REPAIR 150,000 - - - 2,000,000 2,150,000 MAIN LIBRARY IMPROVEMENTS 100,000 - - - - 100,000
MARINA LIBRARY STRUCTURAL IMPROVEMENTS 1,000,000 - - - - 1,000,000 OLD FIRE STATION 25 RENOVATION - - - - 800,000 800,000
PARK RESTROOM PHASE V (55,539) - - - - (55,539)
PARK RESTROOM REFURBISHMENT PHASE IV 164,601 - - - - 164,601

PARKING LOT RESURFACING (SHORELINE/LAKESHORE/LOS
PRADOS/BERESFORD) 300,000 300,000 300,000 300,000 - 1,200,000 POLICE DEPARTMENT ROOF DRAINAGE IMPROVEMENTS 3,818 - - - - 3,818 POLICE JAIL RETROFIT - - 500,000 - - 500,000
RECREATION CENTER BACKUP GENERATOR CONNECTION 50,000 50,000 50,000 50,000 - 200,000 WASHINGTON PARK BASKETBALL COURT 22,615 - - - - 22,615
General Fund Total $ 5,434,076 $ 4,545,000 $ 3,645,000 $ 3,545,000 $ 6,740,000 $ 23,909,076 Grants
101/92 MULTI-MODAL (FASHION ISLAND CLASS IV BIKE
LANE) $ 831,819 $ 3,988,636 $ - $ - $ - $ 4,820,455
CDBG COMMUNITY FACILITIES 40,000 40,000 40,000 40,000 40,000 200,000 CDBG PROJECTS 450,000 450,000 450,000 450,000 450,000 2,250,000 CHILDCARE FACILITY IMPROVEMENTS - - - 250,000 - 250,000 DELAWARE SAFE ROUTES TO SCHOOL CORRIDOR 1,500,000 - - - - 1,500,000 MINOR HOME REPAIR 127,000 127,000 127,000 127,000 127,000 635,000 Grants Total $ 2,948,819 $ 4,605,636 $ 617,000 $ 867,000 $ 617,000 $ 9,655,455 Measure A

ALAMEDA DE LAS PULGAS & BARNESON INTERSECTION
SAFETY 7 OPTIMIZATION $ - $ 200,000 $ - $ 700,000 $ - $ 900,000 BIKE SAN MATEO PROGRAM 202,000 - - - - 202,000
CITYWIDE BRIDGE MAINTENANCE - 75,000 75,000 - - 150,000 CITYWIDE SAFE ROUTES TO SCHOOL PROGRAM 200,000 200,000 200,000 200,000 200,000 1,000,000 CITYWIDE SIGN INVENTORY AND REPLACEMENT - 150,000 150,000 150,000 150,000 600,000 CITYWIDE STREET RECONSTRUCTION PACKAGE 3 200,000 - - - - 200,000 CITYWIDE STREET REHABILITATION PACKAGE 2 (600,000) - - - - (600,000) CITYWIDE STREET REHABILITATION PROGRAM 2,985,000 2,425,000 2,810,000 2,000,000 2,000,000 12,220,000 175
919 of 1111
CIP Projects by Funding Source
2025-26

PROPOSED
BUDGET
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-Year
TOTAL
Measure A (Continued)
CITYWIDE TRAFFIC SIGNAL RETIMING - 25,000 25,000 25,000 25,000 100,000 COMPLETE STREETS NORTH CENTRAL 150,000 - - - - 150,000
COMPLETES STREETS PLAN 100,000 - - - - 100,000
HILLSDALE/ALAMEDA DE LAS PULGAS SIGNAL 450,000 - - - - 450,000 LOCAL ROADWAY SAFETY PLAN IMPLEMENTATION PLAN - 200,000 - - - 200,000 REGIONAL AND CITYWIDE TRANSPORTATION PROGRAM 25,000 25,000 25,000 25,000 25,000 125,000 Measure A Total $ 3,712,000 $ 3,300,000 $ 3,285,000 $ 3,100,000 $ 2,400,000 $ 15,797,000 Measure CC
PENINSULA CORRIDOR COMPLETE STREETS $ 225,000 - - - - $ 225,000 PENINSULA/DELAWARE SAFETY IMPROVEMENT 650,000 - - - - 650,000 Measure CC Total $ 875,000 $ - $ - $ - $ - $ 875,000
Measure S
CITYWIDE PLAY COURT RESURFACING $ 350,000 $ 350,000 $ 350,000 $ 350,000 $ 350,000 $ 1,750,000 CITYWIDE STREET REHABILITATION PROGRAM 800,000 800,000 800,000 800,000 800,000 4,000,000 COLUMBIA/CRYSTAL SPRINGS STORM DRAIN CHA (1,250,000) - - - - (1,250,000) DISPATCH FACILITY IMPROVEMENT - - - 500,000 - 500,000
EXTERNAL RADIO INFRASTRUCTURE (200,000) - - - - (200,000) GATEWAY PARK PEDESTRIAN BRIDGE IMPROVEMENTS 75,000 - - - - 75,000 KING & JOINVILLE CHANGING ROOM IMPROVEMENTS (103,670) - - - - (103,670) LOS PRADOS COURT LIGHTING IMPROVEMENT 300,000 - - - - 300,000 MARINA LIBRARY STRUCTURAL IMPROVEMENTS 1,250,000 250,000 - - - 1,500,000 NEIGHBORHOOD TRAFFIC MANAGMENT - 100,000 100,000 100,000 100,000 400,000 POLICE FACILITY INTERNET EXPANSION 200,000 - - - - 200,000 POLICE STATION: UPS REPLACEMENT 400,000 - - - - 400,000 QUICK BUILD MOBILITY PROGRAM 100,000 100,000 100,000 100,000 100,000 500,000 SPORTS FIELDS CONVERSION: SYNTHETIC TURF (400,000) - - - - (400,000) SYNTHETIC FIELD REPLACEMENT 1,500,000 - - - - 1,500,000 Measure S Total $ 3,021,330 $ 1,600,000 $ 1,350,000 $ 1,850,000 $ 1,350,000 $ 9,171,330 Measure W
CITYWIDE STREET REHABILITATION PROGRAM $ 325,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 4,325,000 TRAIN QUIET ZONE 675,000 75,000 - - - 750,000
Measure W Total $ 1,000,000 $ 1,075,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 5,075,000 Miscellaneous
CITYWIDE FACILITY ROOF REPLACEMENTS $ 800,000 $ 800,000 - - - $ 1,600,000 HOUSING REHABILITATION 60,000 60,000 60,000 60,000 60,000 300,000 LANDFILL MAINTENANCE 1,000,000 - - - - 1,000,000
SEAL POINT PARK POND H2S INVESTIGATION AND
REMEDIATION 120,000 - - - - 120,000
Miscellaneous Total $ 1,980,000 $ 860,000 $ 60,000 $ 60,000 $ 60,000 $ 3,020,000 Parks and Recreation Tax and Fees
CENTRAL PARK $ 750,000 $ - $ - $ - $ - $ 750,000
CITYWIDE PARK PLAY AREA UPGRADE 500,000 100,000 2,000,000 100,000 2,000,000 4,700,000 DOWNTOWN DOG PARK - 500,000 500,000 - - 1,000,000
GOLF BUNKERS - - 850,000 - - 850,000
GOLF IRRIGATION CONTROLLERS & MAINLINE - - 50,000 1,000,000 - 1,050,000 JAPANESE GARDEN REPAIRS 350,000 650,000 - - - 1,000,000 LAURELWOOD PARK PLAYGROUND - - 2,200,000 - - 2,200,000
PARKS AMENITIES ASSESEMENT - 600,000 - - - 600,000
PARKSIDE AQUATIC PLAY AREA 600,000 - - - - 600,000
RYDER PARK WATER FEATURE FILTRATION SYSTEM 50,000 100,000 - - - 150,000 Parks and Recreation Tax and Fees Total $ 2,250,000 $ 1,950,000 $ 5,600,000 $ 1,100,000 $ 2,000,000 12,900,000 Private Contributions
CHILD CARE FACILITIES $ 450,000 $ 450,000 $ 450,000 $ 450,000 $ 450,000 $ 2,250,000 CHILDCARE FACILITY IMPROVEMENTS 150,000 - - - - 150,000 CITYWIDE STREET REHABILITATION PROGRAM 413,000 - - - - 413,000 Private Contributions Total $ 1,013,000 $ 450,000 $ 450,000 $ 450,000 $ 450,000 $ 2,813,000 RMRA
CITYWIDE STREET REHABILITATION PROGRAM $ 2,700,000 $ 2,700,000 $ 2,700,000 $ 2,700,000 $ 2,700,000 $ 13,500,000 RMRA Total $ 2,700,000 $ 2,700,000 $ 2,700,000 $ 2,700,000 $ 2,700,000 $ 13,500,000 176
920 of 1111
CIP Projects by Funding Source
2025-26

PROPOSED
BUDGET
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-Year
TOTAL
Sewer
ANNUAL SANITARY SEWER REHABILITATION $ - $ 7,120,000 $ 10,350,000 $ 8,500,000 $ 8,755,000 $ 34,725,000 COLLECTION SYSTEM ODOR CONTROL 200,000 200,000 200,000 200,000 200,000 1,000,000 CORP YARD MISCELLANEOUS IMPROVEMENTS 50,000 50,000 50,000 50,000 50,000 250,000 CORPORATION YARD PAVING 500,000 - - - - 500,000
CWP ANNUAL CITYWIDE SANITARY SEWER REHAB (5,331,000) - - - - (5,331,000) CWP CCTV INSPECTION PROGRAM 409,000 - - - - 409,000
CWP SEWER FLOW MONITORING & REPORTING (172,000) - - - - (172,000) CWP WWTP ANNUAL MAJOR COMPONENTS 5,487,000 5,365,000 - - - 10,852,000 EAST SAN MATEO LIFT STATION 1,563,000 - - - - 1,563,000 PROGRAM MANAGEMENT - SEWER PROJECTS (874,000) - - - - (874,000) ROOT FOAMING 450,000 450,000 450,000 450,000 450,000 2,250,000 SANITARY SEWER CCTV INSPECTION PROGRAM - 900,000 800,000 900,000 1,200,000 3,800,000 SANITARY SEWER FLOW MONITORING & REPORTING - 125,000 125,000 125,000 125,000 500,000 SANITARY SEWER PUMP STATION UPGRADES - 5,257,000 5,420,000 5,588,000 5,755,000 22,020,000

TMDL ENHANCED PLANNING & INFRASTRUCTURE
IMPROVEMENTS 2,500,000 2,500,000 2,500,000 2,500,000 2,500,000 12,500,000 WWTP & FLOW MANAGEMENT UPGRADE & EXPANSION 24,957,000 - - - - 24,957,000 WWTP ANNUAL REPAIRS - 7,079,805 17,699,930 7,121,035 12,326,652 44,227,422 WWTP PAVING (100,000) - - - - (100,000)
Sewer Total $ 29,639,000 $ 29,046,805 $ 37,594,930 $ 25,434,035 $ 31,361,652 $ 153,076,422 Stormwater Fee
CITYWIDE SOIL STABILIZATION PROGRAM $ 400,000 $ 150,000 $ 150,000 $ 150,000 $ 150,000 $ 1,000,000 COYOTE PARK/POPLAR PUMP STATION 50,000 - - - - 50,000
GREEN STORMWATER INFRASTRUCTURE PROGRAM 500,000 500,000 200,000 200,000 200,000 1,600,000 MARINA LAGOON DREDGING DESIGN/PERMITTING 150,000 50,000 - - - 200,000 STORM DRAIN CONDITION ASSESSMENT 550,000 100,000 100,000 100,000 100,000 950,000 STORM SYSTEM DREDGING 1,100,000 - - - - 1,100,000
STORM SYSTEM MINOR REPAIR 250,000 250,000 250,000 250,000 250,000 1,250,000 TRAIN QUIET ZONE 400,000 - - - - 400,000
Stormwater Fee Total $ 3,400,000 $ 1,050,000 $ 700,000 $ 700,000 $ 700,000 $ 6,550,000 Taxes, Fees & Charges
CDD OFFICE REMODEL $ 140,000 - - - - $ 140,000
CDD SERVICE IMPROVEMENT - ELECTRONIC & DIGITAL 250,000 250,000 250,000 250,000 250,000 1,250,000 CITYWIDE STREET RECONSTRUCTION FY18-19 (570,501) - - - - (570,501) CITYWIDE STREET RECONSTRUCTION PACKAGE 1 275,000 - - - - 275,000 CITYWIDE STREET RECONSTRUCTION PACKAGE 2 174,473 - - - - 174,473 CITYWIDE STREET RECONSTRUCTION PACKAGE 3 670,501 - - - - 670,501 CITYWIDE STREET REHABILITATION PACKAGE 1 (303,000) - - - - (303,000) CITYWIDE STREET REHABILITATION PROGRAM 653,000 350,000 350,000 350,000 350,000 2,053,000

PEG PROJECT (PUBLIC, EDUCATIONAL, AND
GOVERNMENTAL ACCESS CHANNELS) 750,000 - - - - 750,000
TRASH CAPTURE AT POPLAR AND MONTE DIABLO (750,000) - - - - (750,000) Taxes, Fees & Charges Total $ 1,289,473 $ 600,000 $ 600,000 $ 600,000 $ 600,000 $ 3,689,473 Traffic Impact Fees
BIKE SAN MATEO PROGRAM $ 700,000 $ 700,000 $ 700,000 $ - $ - $ 2,100,000 CITYWIDE TRAFFIC CALMING 150,000 150,000 150,000 150,000 150,000 750,000 Traffic Impact Fees Total $ 850,000 $ 850,000 $ 850,000 $ 150,000 $ 150,000 $ 2,850,000 Tree Replacement Fee
TREE PLANTING - PARKS DIVISION $ 175,000 $ 175,000 $ 175,000 $ 175,000 $ 175,000 $ 875,000 Tree Replacement Fee Total $ 175,000 $ 175,000 $ 175,000 $ 175,000 $ 175,000 $ 875,000 Grand Totals $ 61,540,698 $ 54,060,441 $ 59,879,930 $ 42,984,035 $ 51,556,652 $ 270,021,756 177
921 of 1111
Funded
Projects
178
922 of 1111
Funded Projects

PROJECT NAME FUNDING SOURCE
2025-26

PROPOSED
BUDGET
101/92 MULTI-MODAL (FASHION ISLAND CLASS IV BIKE LANE) Grants $ 831,819 ADA COMPLIANCE AND TRANSITION PLANNING General Fund 250,000 ADA ENTRY COMPLIANCE - BERESFORD General Fund 18,766
ALAMEDA DE LAS PULGAS & BARNESON INTERSECTION SAFETY 7 OPTIMIZATION Measure A - ANNUAL SANITARY SEWER REHABILITATION Sewer -
BIKE SAN MATEO PROGRAM Measure A 202,000
BIKE SAN MATEO PROGRAM Traffic Impact Fees 700,000
BOREL PARK DEVELOPMENT General Fund (801,185)
CDBG COMMUNITY FACILITIES Grants 40,000
CDBG PROJECTS Grants 450,000
CDD OFFICE REMODEL Taxes, Fees & Charges 140,000
CDD SERVICE IMPROVEMENT - ELECTRONIC & DIGITAL Taxes, Fees & Charges 250,000 CENTRAL PARK Parks and Recreation Tax and Fees 750,000
CHILD CARE FACILITIES Private Contributions 450,000
CHILDCARE FACILITY IMPROVEMENTS Grants -
CHILDCARE FACILITY IMPROVEMENTS Private Contributions 150,000 CITYWIDE BICYCLE PARKING Gas Tax -
CITYWIDE BRIDGE MAINTENANCE Measure A -
CITYWIDE EMERGENCY FIELD LIGHTING General Fund 120,000
CITYWIDE FACILITY INTERIOR IMPROVEMENTS General Fund -
CITYWIDE FACILITY ROOF REPLACEMENTS General Fund 200,000 CITYWIDE FACILITY ROOF REPLACEMENTS Miscellaneous 800,000 CITYWIDE FACILITY WATERPROOFING IMPROVEMENTS General Fund 475,000 CITYWIDE FENCE IMPROVEMENTS General Fund 100,000
CITYWIDE FIRE - INTRSN ALARM SYSTM UPGRADE General Fund 250,000 CITYWIDE PARK PLAY AREA UPGRADE Parks and Recreation Tax and Fees 500,000 CITYWIDE PICNIC AREA IMPROVEMENTS General Fund 50,000
CITYWIDE PLAY COURT RESURFACING Measure S 350,000
CITYWIDE PLAYGROUND EQUIPMENT REPLACEMENT General Fund 450,000 CITYWIDE SAFE ROUTES TO SCHOOL PROGRAM Measure A 200,000 CITYWIDE SIDEWALK REPAIR PROGRAM General Fund 115,000
CITYWIDE SIGN INVENTORY AND REPLACEMENT Measure A -
CITYWIDE SOIL STABILIZATION PROGRAM Stormwater Fee 400,000 CITYWIDE STREET RECONSTRUCTION FY18-19 Taxes, Fees & Charges (570,501) CITYWIDE STREET RECONSTRUCTION PACKAGE 1 Taxes, Fees & Charges 275,000 CITYWIDE STREET RECONSTRUCTION PACKAGE 2 Taxes, Fees & Charges 174,473 CITYWIDE STREET RECONSTRUCTION PACKAGE 3 Measure A 200,000 CITYWIDE STREET RECONSTRUCTION PACKAGE 3 Taxes, Fees & Charges 670,501 CITYWIDE STREET REHABILITATION FY18-19 General Fund (160,000) CITYWIDE STREET REHABILITATION PACKAGE 1 Taxes, Fees & Charges (303,000) CITYWIDE STREET REHABILITATION PACKAGE 2 Measure A (600,000) CITYWIDE STREET REHABILITATION PACKAGE 3 General Fund (205,117) CITYWIDE STREET REHABILITATION PROGRAM Gas Tax 1,203,000 CITYWIDE STREET REHABILITATION PROGRAM General Fund 205,117 CITYWIDE STREET REHABILITATION PROGRAM Measure A 2,985,000 CITYWIDE STREET REHABILITATION PROGRAM Measure S 800,000 CITYWIDE STREET REHABILITATION PROGRAM Measure W 325,000 CITYWIDE STREET REHABILITATION PROGRAM Private Contributions 413,000 CITYWIDE STREET REHABILITATION PROGRAM RMRA 2,700,000
CITYWIDE STREET REHABILITATION PROGRAM Taxes, Fees & Charges 653,000 CITYWIDE TRAFFIC CALMING Traffic Impact Fees 150,000
CITYWIDE TRAFFIC SIGNAL RETIMING Measure A -
COLLECTION SYSTEM ODOR CONTROL Sewer 200,000
COLUMBIA/CRYSTAL SPRINGS STORM DRAIN CHA General Fund (750,000) COLUMBIA/CRYSTAL SPRINGS STORM DRAIN CHA Measure S (1,250,000) 179
923 of 1111
Funded Projects
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-Year
TOTAL
$ 3,988,636 $ - $ - $ - $ 4,820,455
35,000 35,000 35,000 - 355,000
- - - - 18,766
200,000 - 700,000 - 900,000
7,120,000 10,350,000 8,500,000 8,755,000 34,725,000
- - - - 202,000
700,000 700,000 - - 2,100,000
- - - - (801,185)
40,000 40,000 40,000 40,000 200,000
450,000 450,000 450,000 450,000 2,250,000
- - - - 140,000
250,000 250,000 250,000 250,000 1,250,000
- - - - 750,000
450,000 450,000 450,000 450,000 2,250,000
- - 250,000 - 250,000
- - - - 150,000
10,000 10,000 - - 20,000
75,000 75,000 - - 150,000
120,000 120,000 120,000 - 480,000
400,000 400,000 800,000 800,000 2,400,000
- 100,000 100,000 1,000,000 1,400,000
800,000 - - - 1,600,000
1,000,000 1,000,000 1,000,000 1,000,000 4,475,000
100,000 100,000 100,000 100,000 500,000
250,000 250,000 250,000 250,000 1,250,000
100,000 2,000,000 100,000 2,000,000 4,700,000
50,000 50,000 50,000 50,000 250,000
350,000 350,000 350,000 350,000 1,750,000
450,000 450,000 450,000 450,000 2,250,000
200,000 200,000 200,000 200,000 1,000,000
115,000 115,000 115,000 115,000 575,000
150,000 150,000 150,000 150,000 600,000
150,000 150,000 150,000 150,000 1,000,000
- - - - (570,501)
- - - - 275,000
- - - - 174,473
- - - - 200,000
- - - - 670,501
- - - - (160,000)
- - - - (303,000)
- - - - (600,000)
- - - - (205,117)
1,193,000 1,193,000 1,203,000 1,203,000 5,995,000
- - - - 205,117
2,425,000 2,810,000 2,000,000 2,000,000 12,220,000
800,000 800,000 800,000 800,000 4,000,000
1,000,000 1,000,000 1,000,000 1,000,000 4,325,000
- - - - 413,000
2,700,000 2,700,000 2,700,000 2,700,000 13,500,000
350,000 350,000 350,000 350,000 2,053,000
150,000 150,000 150,000 150,000 750,000
25,000 25,000 25,000 25,000 100,000
200,000 200,000 200,000 200,000 1,000,000
- - - - (750,000)
- - - - (1,250,000)
180
924 of 1111
Funded Projects

PROJECT NAME FUNDING SOURCE
2025-26

PROPOSED
BUDGET
COMPLETE STREETS NORTH CENTRAL Measure A $ 150,000
COMPLETES STREETS PLAN Measure A 100,000
CORP YARD MISCELLANEOUS IMPROVEMENTS General Fund 50,000 CORP YARD MISCELLANEOUS IMPROVEMENTS Sewer 50,000
CORPORATION YARD PAVING General Fund -
CORPORATION YARD PAVING Sewer 500,000
COYOTE PARK/POPLAR PUMP STATION Stormwater Fee 50,000
CWP ANNUAL CITYWIDE SANITARY SEWER REHAB Sewer (5,331,000) CWP CCTV INSPECTION PROGRAM Sewer 409,000
CWP SEWER FLOW MONITORING & REPORTING Sewer (172,000)
CWP WWTP ANNUAL MAJOR COMPONENTS Sewer 5,487,000
DELAWARE SAFE ROUTES TO SCHOOL CORRIDOR Grants 1,500,000 DISPATCH FACILITY IMPROVEMENT Measure S -
DOWNTOWN DOG PARK Parks and Recreation Tax and Fees -
DOWNTOWN PARKING IMPROVEMENTS General Fund 100,000
DOWNTOWN RESTROOMS General Fund 25,000
EAST SAN MATEO LIFT STATION Sewer 1,563,000
EXTERNAL RADIO INFRASTRUCTURE Measure S (200,000)
FIRE STATION 24 SHOWER REMODEL General Fund (144,000)
GATEWAY PARK PEDESTRIAN BRIDGE IMPROVEMENTS Measure S 75,000 GOLF BUNKERS Parks and Recreation Tax and Fees -
GOLF IRRIGATION CONTROLLERS & MAINLINE Parks and Recreation Tax and Fees - GRAMMERCY DRIVE RETAINING WALL Gas Tax 50,000
GREEN STORMWATER INFRASTRUCTURE PROGRAM Stormwater Fee 500,000 HIGH VOLTAGE STREET LIGHT CONVERSION General Fund 700,000 HILLSDALE/ALAMEDA DE LAS PULGAS SIGNAL Measure A 450,000 HOUSING REHABILITATION Miscellaneous 60,000
JAPANESE GARDEN REPAIRS Parks and Recreation Tax and Fees 350,000 JOINVILLE POOL ASSESSMENT & IMPROVEMENTS General Fund 2,650,000 KING & JOINVILLE CHANGING ROOM IMPROVEMENTS Measure S (103,670) LANDFILL MAINTENANCE Miscellaneous 1,000,000
LAURELWOOD PARK PLAYGROUND Parks and Recreation Tax and Fees - LAURELWOOD PARK RETAINING WALL REPAIR General Fund 150,000 LOCAL ROADWAY SAFETY PLAN IMPLEMENTATION PLAN Measure A - LOS PRADOS COURT LIGHTING IMPROVEMENT Measure S 300,000 MAIN LIBRARY IMPROVEMENTS General Fund 100,000
MARINA LAGOON DREDGING DESIGN/PERMITTING Stormwater Fee 150,000 MARINA LIBRARY STRUCTURAL IMPROVEMENTS General Fund 1,000,000 MARINA LIBRARY STRUCTURAL IMPROVEMENTS Measure S 1,250,000 MINOR HOME REPAIR Grants 127,000
NEIGHBORHOOD TRAFFIC MANAGMENT Measure S -
OLD FIRE STATION 25 RENOVATION General Fund -
PARK RESTROOM PHASE V General Fund (55,539)
PARK RESTROOM REFURBISHMENT PHASE IV General Fund 164,601 PARKING LOT RESURFACING (SHORELINE/LAKESHORE/LOS PRADOS/BERESFORD) General Fund 300,000 PARKS AMENITIES ASSESEMENT Parks and Recreation Tax and Fees - PARKSIDE AQUATIC PLAY AREA Parks and Recreation Tax and Fees 600,000 PEG PROJECT (PUBLIC, EDUCATIONAL, AND GOVERNMENTAL ACCESS CHANNELS) Taxes, Fees & Charges 750,000 PENINSULA CORRIDOR COMPLETE STREETS Measure CC 225,000
PENINSULA/DELAWARE SAFETY IMPROVEMENT Measure CC 650,000 POLICE DEPARTMENT ROOF DRAINAGE IMPROVEMENTS General Fund 3,818 POLICE FACILITY INTERNET EXPANSION Measure S 200,000
POLICE JAIL RETROFIT General Fund -
POLICE STATION: UPS REPLACEMENT Measure S 400,000
PROGRAM MANAGEMENT - SEWER PROJECTS Sewer (874,000)
181
925 of 1111
Funded Projects
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-Year
TOTAL
$ - $ - $ - $ - $ 150,000
- - - - 100,000
50,000 50,000 50,000 50,000 250,000
50,000 50,000 50,000 50,000 250,000
500,000 - - - 500,000
- - - - 500,000
- - - - 50,000
- - - - (5,331,000)
- - - - 409,000
- - - - (172,000)
5,365,000 - - - 10,852,000
- - - - 1,500,000
- - 500,000 - 500,000
500,000 500,000 - - 1,000,000
100,000 100,000 100,000 100,000 500,000
25,000 25,000 25,000 25,000 125,000
- - - - 1,563,000
- - - - (200,000)
- - - - (144,000)
- - - - 75,000
- 850,000 - - 850,000
- 50,000 1,000,000 - 1,050,000
50,000 50,000 50,000 50,000 250,000
500,000 200,000 200,000 200,000 1,600,000
1,000,000 - - - 1,700,000
- - - - 450,000
60,000 60,000 60,000 60,000 300,000
650,000 - - - 1,000,000
- - - - 2,650,000
- - - - (103,670)
- - - - 1,000,000
- 2,200,000 - - 2,200,000
- - - 2,000,000 2,150,000
200,000 - - - 200,000
- - - - 300,000
- - - - 100,000
50,000 - - - 200,000
- - - - 1,000,000
250,000 - - - 1,500,000
127,000 127,000 127,000 127,000 635,000
100,000 100,000 100,000 100,000 400,000
- - - 800,000 800,000
- - - - (55,539)
- - - - 164,601
300,000 300,000 300,000 - 1,200,000
600,000 - - - 600,000
- - - - 600,000
- - - - 750,000
- - - - 225,000
- - - - 650,000
- - - - 3,818
- - - - 200,000
- 500,000 - - 500,000
- - - - 400,000
- - - - (874,000)
182
926 of 1111
Funded Projects

PROJECT NAME FUNDING SOURCE
2025-26

PROPOSED
BUDGET
QUICK BUILD MOBILITY PROGRAM Measure S $ 100,000
RECREATION CENTER BACKUP GENERATOR CONNECTION General Fund 50,000 REGIONAL AND CITYWIDE TRANSPORTATION PROGRAM MANAGEMENT Measure A 25,000 ROOT FOAMING Sewer 450,000
RYDER PARK WATER FEATURE FILTRATION SYSTEM Parks and Recreation Tax and Fees 50,000 SANITARY SEWER CCTV INSPECTION PROGRAM Sewer -
SANITARY SEWER FLOW MONITORING & REPORTING Sewer -
SANITARY SEWER PUMP STATION UPGRADES Sewer -
SEAL POINT PARK POND H2S INVESTIGATION AND REMEDIATION Miscellaneous 120,000 SPORTS FIELDS CONVERSION: SYNTHETIC TURF Measure S (400,000) STORM DRAIN CONDITION ASSESSMENT Stormwater Fee 550,000 STORM SYSTEM DREDGING Stormwater Fee 1,100,000
STORM SYSTEM MINOR REPAIR Stormwater Fee 250,000
SYNTHETIC FIELD REPLACEMENT Measure S 1,500,000
TMDL ENHANCED PLANNING & INFRASTRUCTURE IMPROVEMENTS Sewer 2,500,000 TRAIN QUIET ZONE Measure W 675,000
TRAIN QUIET ZONE Stormwater Fee 400,000
TRASH CAPTURE AT POPLAR AND MONTE DIABLO Taxes, Fees & Charges (750,000) TREE PLANTING - PARKS DIVISION Tree Replacement Fee 175,000 WASHINGTON PARK BASKETBALL COURT General Fund 22,615
WWTP & FLOW MANAGEMENT UPGRADE & EXPANSION Sewer 24,957,000 WWTP ANNUAL REPAIRS Sewer -
WWTP PAVING Sewer (100,000)
Grand Total $ 61,540,698
183
927 of 1111
Funded Projects
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-Year
TOTAL
$ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 500,000
50,000 50,000 50,000 - 200,000
25,000 25,000 25,000 25,000 125,000
450,000 450,000 450,000 450,000 2,250,000
100,000 - - - 150,000
900,000 800,000 900,000 1,200,000 3,800,000
125,000 125,000 125,000 125,000 500,000
5,257,000 5,420,000 5,588,000 5,755,000 22,020,000
- - - - 120,000
- - - - (400,000)
100,000 100,000 100,000 100,000 950,000
- - - - 1,100,000
250,000 250,000 250,000 250,000 1,250,000
- - - - 1,500,000
2,500,000 2,500,000 2,500,000 2,500,000 12,500,000
75,000 - - - 750,000
- - - - 400,000
- - - - (750,000)
175,000 175,000 175,000 175,000 875,000
- - - - 22,615
- - - - 24,957,000
7,079,805 17,699,930 7,121,035 12,326,652 44,227,422
- - - - (100,000)
$ 54,060,441 $ 59,879,930 $ 42,984,035 $ 51,556,652 $ 270,021,756 184
928 of 1111
Unfunded
Projects
185
929 of 1111
Unfunded Projects by Project Amount

PROJECT NAME
TOTAL

ESTIMATED
COST
CENTRAL PARK (PHASE 2-4) $ 50,000,000
HILLSDALE BOULEVARD/US 101 BRIDGE OVERCROSSING 50,000,000 NEW CENTRAL PARK PARKING GARAGE 32,000,000
NEW CORPORATION YARD FACILITY 26,000,000
CITYWIDE BRIDGE MAINTENANCE 22,000,000
2ND & EL CAMINO REAL GARAGE LONG-TERM IMPROVEMENTS 20,000,000 KING RESILIENCY CENTER 20,000,000
COYOTE POINT DRAINAGE AREA 17,050,000
19TH AVENUE DRAINAGE AREA 11,972,000
NEW FIRE STATION #27 11,000,000
LAUREL CREEK DRAINAGE AREA 9,567,000
16TH AVENUE DRAINAGE AREA 9,521,000
LAURELWOOD / SUGARLOAF OPEN SPACE 8,215,000
BMP-ML PROJECT 1-14 7,835,000
DETROIT DRIVE DRAINAGE AREA 5,728,000
BMP-L PROJECT 1-17 5,294,000
CITYWIDE PARK SIGNS 5,000,000
SHORELINE PARKS 5,000,000
PARKING FACILITY STRUCTURAL REPAIRS 4,000,000
MARINER'S ISLAND BRIDGE APPROACH STABILIZATION 3,760,000 MONTE DIABLO AVENUE PEDESTRIAN SCALE LIGHTING 3,300,000 PALM AVENUE PEDESTRIAN SCALE LIGHTING 3,300,000
MAIN LIBRARY IMPROVEMENTS 3,183,575
SAN MATEO CREEK DRAINAGE AREA 2,620,000
28TH AVE GAP CLOSURE CONSTRUCTION 2,310,000
PASADENA ROADWAY RECONSTRUCTION 2,250,000
CITYWIDE ELEVATOR MODERNIZATION 1,500,000
PAINT EXTERIOR & INTERIOR MAIN STREET GARAGE 1,500,000
PARK RENOVATION SHOREVIEW PARK MASTER PLAN AND IMPLEMENTATION 1,200,000 LAKESHORE COMMUNITY CENTER IMPROVEMENTS 1,000,000
PARK RESTROOM REFURBISHMENT - PHASE VI 1,000,000
RYDER CREEK BRIDGE PAINTING 750,000
FIRE STATION #27 IMPROVEMETNS 660,000
BAY MEADOWS COMMUNITY PARK PLANNING 500,000
CITYWIDE ASSISTIVE LISTENING DEVICES 400,000
PATHWAY REPAIRS AT VARIOUS PARKS 375,000
PLANNING PARK DEVELOPMENT AT DALE AVE & ANCHOR RD 350,000 REST ROOM BUILDING REPLACEMENT TRINTA 350,000
CITY HALL IMPROVEMENTS 300,000
POLICE DEPARTMENT EXTERIOR - REPAINT DECK FENCING 300,000 EAST 5TH AVENUE PEDESTRIAN SCALE LIGHTING 220,000
STREETLIGHT MASTER PLAN 200,000
REFURBISH NORTH END OF KOI POND 180,000
POLICE DEPARTMENT INTERIOR WORK REORGANIZATION 150,000
INSTALL SECURITY CAMERAS AT SELECTED PARKS 120,000
Grand Total $ 351,960,575
186
930 of 1111
Unfunded Projects by Project Name

PROJECT NAME
TOTAL

ESTIMATED
COST
16TH AVENUE DRAINAGE AREA $ 9,521,000
19TH AVENUE DRAINAGE AREA 11,972,000
28TH AVE GAP CLOSURE CONSTRUCTION 2,310,000
2ND & EL CAMINO REAL GARAGE LONG-TERM IMPROVEMENTS 20,000,000 BAY MEADOWS COMMUNITY PARK PLANNING 500,000
BMP-L PROJECT 1-17 5,294,000
BMP-ML PROJECT 1-14 7,835,000
CENTRAL PARK (PHASE 2-4) 50,000,000
CITY HALL IMPROVEMENTS 300,000
CITYWIDE ASSISTIVE LISTENING DEVICES 400,000
CITYWIDE BRIDGE MAINTENANCE 22,000,000
CITYWIDE ELEVATOR MODERNIZATION 1,500,000
CITYWIDE PARK SIGNS 5,000,000
COYOTE POINT DRAINAGE AREA 17,050,000
DETROIT DRIVE DRAINAGE AREA 5,728,000
EAST 5TH AVENUE PEDESTRIAN SCALE LIGHTING 220,000
FIRE STATION #27 IMPROVEMETNS 660,000
HILLSDALE BOULEVARD/US 101 BRIDGE OVERCROSSING 50,000,000 INSTALL SECURITY CAMERAS AT SELECTED PARKS 120,000
KING RESILIENCY CENTER 20,000,000
LAKESHORE COMMUNITY CENTER IMPROVEMENTS 1,000,000
LAUREL CREEK DRAINAGE AREA 9,567,000
LAURELWOOD / SUGARLOAF OPEN SPACE 8,215,000
MAIN LIBRARY IMPROVEMENTS 3,183,575
MARINER'S ISLAND BRIDGE APPROACH STABILIZATION 3,760,000 MONTE DIABLO AVENUE PEDESTRIAN SCALE LIGHTING 3,300,000 NEW CENTRAL PARK PARKING GARAGE 32,000,000
NEW CORPORATION YARD FACILITY 26,000,000
NEW FIRE STATION #27 11,000,000
PAINT EXTERIOR & INTERIOR MAIN STREET GARAGE 1,500,000
PALM AVENUE PEDESTRIAN SCALE LIGHTING 3,300,000
PARK RENOVATION SHOREVIEW PARK MASTER PLAN AND IMPLEMENTATION 1,200,000 PARK RESTROOM REFURBISHMENT - PHASE VI 1,000,000
PARKING FACILITY STRUCTURAL REPAIRS 4,000,000
PASADENA ROADWAY RECONSTRUCTION 2,250,000
PATHWAY REPAIRS AT VARIOUS PARKS 375,000
PLANNING PARK DEVELOPMENT AT DALE AVE & ANCHOR RD 350,000 POLICE DEPARTMENT EXTERIOR - REPAINT DECK FENCING 300,000 POLICE DEPARTMENT INTERIOR WORK REORGANIZATION 150,000
REFURBISH NORTH END OF KOI POND 180,000
REST ROOM BUILDING REPLACEMENT TRINTA 350,000
RYDER CREEK BRIDGE PAINTING 750,000
SAN MATEO CREEK DRAINAGE AREA 2,620,000
SHORELINE PARKS 5,000,000
STREETLIGHT MASTER PLAN 200,000
Grand Total $ 351,960,575
187
931 of 1111

APPENDIX
Appendix
188
932 of 1111
Financial Policies
Statement of Purpose
The financial integrity of our City government is of utmost importance. To discuss, write, and adopt a set of financial policies is a key element to maintaining this integrity. Our City has evolved with a variety of financial policies that can be found in many different sources, including City Council resolutions, budget documents, and capital improvement
programs. The set of policies within this document, adopted each year with our budget, serves as a central reference point of the most important of our policies, which are critical to the continued financial health of our local government.

Written, adopted financial policies have many benefits, such as assisting elected officials and staff in the financial management of the City, saving time and energy when
discussing financial matters, engendering public
confidence, and providing continuity over time as elected officials and staff members change. While these policies will be amended periodically, they provide the foundation and framework for many of the issues and decisions facing the City. They promote sound financial management and assist in the City’s stability, efficiency, and effectiveness.

The following policies are divided into ten (10) general categories for ease of reference. These categories include:

1. General

2. Accounting, Auditing, and Financial Reporting

3. Funding Balance and Reserve

4. Pension and Retirement Funding

5. Internal Service Fund

6. Debt

7. Revenue

8. Capital Improvement

9. Investment

10. Operating Budget
Except as otherwise noted, all policies included in this document are currently adhered to.

Additionally, included at the end of this section are specific policy benchmarks along with their status.

General
The City will:
• Manage its financial assets in a sound and prudent
manner.
• Maintain and further develop programs to ensure its
long-term ability to fund core services and pay all
costs necessary to provide the level and quality of
service required by its citizens.
• Establish and maintain investment policies that are in accordance with State laws.
• Follow the financial sustainability guiding principles to provide a roadmap to guide future financial decisions.

Accounting, Auditing, and Financial
Reporting
Accounting Standards
The City’s accounting of financial systems shall be
maintained in accordance with Generally Accepted
Accounting Principles (GAAP), standards of the
Governmental Accounting Standards Board (GASB), and the Government Finance Officers Association (GFOA).

Annual Audit
An independent certified public accounting firm will
perform an annual audit, and its opinions will be included in the Annual Comprehensive Financial Report and presented to the City Council at a public meeting.

Financial Information
It is the policy of the City of San Mateo to provide all financial information in a thorough, timely fashion, and in a format that is easy for City Council, citizens, and City employees to understand and utilize.

It is the City’s goal to maintain accounting records,
processes, and procedures in such a manner as to receive an unmodified audit opinion and to maintain a Certificate of Achievement for Excellence in Financial Reporting from the GFOA.

Funding Balance and Reserve
The City utilizes a variety of accounting funds for recording revenues and expenditures of the City. At the end of each fiscal year, budgeted/appropriated expenditure authority lapses, with the exception of capital project spending and operating expenses that have been incurred but not paid (encumbered). The remaining dollars left in each fund are unassigned and constitute available funds of the City. Fund balance will be reported in the following classifications:
189
933 of 1111
Financial Policies
Nonspendable Fund Balance
Amounts that are not in spendable form, such as inventory, prepaid amounts, long-term receivables, and those
that legally or contractually must be kept intact, such as endowment corpus of revolving loan funds.

Restricted Fund Balance
Amounts that can be used only for specific purposes due to constitutional provisions, enabling legislation, or externally imposed constraints, such as restrictions imposed by
creditors, grantors, or other governments.

Committed Fund Balance
Amounts that can only be used for specific purposes
because of a formal action by the government’s highest
decision-making authority. These constraints are binding unless removed in the same manner in which they were
originally committed.

Assigned Fund Balance
Amounts intended for specific purposes but not restricted or committed. The assigned fund balance can never be in excess of the total fund balance less the non-spendable, restricted, and committed components of fund balance.

Ultimately, this is the residual fund balance for all funds other than General Fund.

Unassigned Fund Balance
The residual classification for the General Fund, the only governmental fund that can report a positive unassigned fund balance. Other funds might have a negative
unassigned fund balance due to overspending restricted, committed, or assigned amounts.

General Fund
Based on City Council direction from the April 7, 2025
meeting, the General Fund Reserve Policy has been
amended and is incorporated into the FY 2025-26 Annual
Budget. The revised policy will take effective July 1, 2025 and the full text is included in the Appendix of this budget book.

A summary is provided below:
• Contingency Reserve will be maintained at 15% of
the General Fund budgeted operation expenditures.

This reserve will only be utilized for extraordinary,
one-time events that cause significant financial strain, such as natural disasters, public health crises, legal
obligations, emergency infrastructure repairs, or major unforeseen non-financial emergencies as determined
by the City Council.
•
•
Housing Set-Aside Reserve: Housing Element, 20%
of RDA residual property tax will be allocated annually to the Housing Set-Aside Reserve at the discretion of
the City Council. This reserve will be used to support
affordable housing initiatives.

Capital Improvement Projects (CIP) Carryover
Reserve will hold funds budgeted for capital
improvement projects that have not yet been
transferred to the Capital Projects Fund.
• Budget Stabilization Reserve will be set at 15% of
the General Fund budgeted revenues. This reserve
will be replenished during economic growth periods
and utilized to stabilize the budget and maintain core
services during economic downturns.

The Finance Director shall develop a General Fund
long-range forecast and review the reserve levels
as part of the budget development process. If the
Budget Stabilization Reserve falls below 10% in the
next two budget cycles per the long-range forecast,
the City Manager shall propose a plan to restore the
reserve to the target level, subject to City Council
approval.
• Pension Stabilization Reserve is established to
mitigate impact of rising pension costs and prevent
unexpected increases in unfunded pension liabilities
from affecting city services. Initial contribution to this reserve is $10 million. Additional funding may come
from surplus funds, one-time revenues, or other
unrestricted funding sources, subject to City Council
approval.

Capital Projects Fund
The Capital Investment Reserve is established within the Capital Projects Fund to finance major capital improvement projects that are critical to support municipal services. The full policy text is included in the Appendix of this budget book.

A summary is provided below:

Use of the Capital Investment Reserve should be
authorized by the City Council.

Additional funding may come from surplus funds, one-time revenues, proceeds from the sales of properties, or other unrestricted funding sources, subject to Council approval.

To ensure transparency and accountability, the Finance
Director shall provide an annual report on the status of the Capital Investment Reserve. This annual report shall be presented to the City Council during a regularly scheduled financial update.
190
934 of 1111
Financial Policies
Enterprise Fund
The City’s Sewer Enterprise Fund will maintain reserves equal to four months of operating expenses.

Special Revenue Funds
The City’s Construction Services Fund will maintain
reserves equal to twelve months of budgeted operating
expenditures.

Pension and Retirement Funding
The City contracts with the California Public Employees' Retirement System for pension benefits. The City will
make minimum annual payments for the employer share
equal to the required Annual Required Contribution (ARC) established by actuarial valuation but, in any given year, no less than the normal cost.

The City offers a retiree health benefit to employees of $160 per month. The City will fund the ActuariallyDetermined Contribution (ADC) established by actuarial valuation in an irrevocable trust. Actuarial valuations will be conducted on a biennial basis consistent with accounting standards.

Internal Service Fund
Vehicle and Equipment Replacement Fund
Through the use of the Vehicle/Equipment Replacement
Fund, the City will annually budget sufficient funds to provide for the orderly replacement of the City’s fleet, vehicles, computers, radios, equipment, technology
infrastructure, and other major capital outlay. The fund is supported by charges to user departments, which are
adjusted annually based on the departments’ proportionate share of estimated expenses*. Sufficient reserves will be maintained in the Replacement Fund to provide for the
scheduled replacement of equipment at the end of their
useful lives.

Fleet and Building Maintenance Fund
Through the use of the Fleet and Building Maintenance
Fund, the City will annually budget sufficient funds
to provide for orderly fleet and building maintenance
and repair. The fund is supported by charges to user
departments which are adjusted annually based on the
department’s proportionate share of estimated expenses*.

Sufficient reserves will be maintained in the Replacement Fund to provide for the scheduled replacement of
equipment at the end of their useful lives.
*Internal service funds are allocated proportionate to the expenses with exception of the Community Development Block Grant Fund, which needs to maintain less than 10% in indirect costs. Charges may be reduced in this fund if necessary.

Risk Management Funds
The City maintains a Comprehensive Liability Insurance
Fund and a Workers’ Compensation Insurance Fund for the purpose of property, liability, and workers’ compensation expenses. These funds pay insurance premiums, benefit
and settlement payments, and administrative and operating expenses. The City will complete an actuarial valuation of these funds every other year. The Workers’ Compensation Fund is supported by charges to other City funds for the services it provides*. These annual charges for service shall reflect historical experience and shall be established to approximately equal the annual expenses of the fund.

The Comprehensive Liability Fund is predominantly
supported by the General Fund. Separate reserves shall
be maintained for current and long-term general liability and workers’ compensation liability at a level which will adequately fund the City’s potential loss exposure in each area. The practice is to establish reserves in both funds at least at the marginally acceptable level as determined by the actuarial report.

Debt
The City is bound by a provision in State law limiting
indebtedness for California cities to 15% of the assessed value of all real and personal property of the City. The City of San Mateo has been prudent in its use of debt to finance projects and major purchases. Prior to the issuance of any debt, the funding source for the debt service is identified and designated. The level of debt to which the City obligates itself is managed within available resources and represents a minimal cost to general taxpayers.

By managing the repayment of new debt, current City
operations are not affected.

Credit Rating
It is the City’s goal for its general obligation (GO) bonds to maintain a AAA rating, and for the Sewer Enterprise to
maintain a AA-/Aa2 credit rating. The factors that contribute to the high rating include the City’s strong financial
management, low debt levels, budgetary and fiscal
controls, and accountability. To support this policy, the City will continue to maintain its position of full financial disclosure and proactive fiscal planning.
191
935 of 1111
Financial Policies
Revenue
General Fund Revenue
The City will strive to develop and maintain a diversified and reliable revenue stream to avoid becoming overly
dependent on any single type of revenue. Efforts will
be directed to optimize existing revenue sources while
periodically reviewing potential new revenue sources.

Budgeted revenues will be estimated conservatively using accepted standards and estimates provided by the state, other governmental agencies, or reliable economic
forecasters, when available. Due to the volatile nature of the property transfer tax, revenue is projected using a consistent methodology based on historical averages.

Grants
The City shall actively pursue federal, state, and other grant opportunities when deemed appropriate. Before
accepting any grant, the City shall thoroughly consider the implications in terms of ongoing obligations that will be required in connection with acceptance of said grant, including replacement and ongoing operating costs.

Enterprise Fund Fees and Charges
The City will set user fees for its Enterprise Fund at a rate that fully covers direct and indirect costs of providing the service, planned capital improvements that may be
necessary from time to time, and maintains a debt coverage ratio of at least 120% of net revenues for compliance
purposes with outstanding debt covenants.

User Service Fees
The City may impose user fees wherever appropriate.

Such fees will recover the cost of providing the service, demonstrating a nexus to benefits received, including
all direct and indirect costs, administrative overhead, depreciation, etc. By policy, Council may direct certain fees to be lowered for particular purposes. Waivers of user fees will be presented for Council approval as appropriate.

Certain fees are based upon market conditions and are not subject to the limitations of cost recovery. These fees may be adjusted periodically by the City Council. In general, fees will be reviewed no less than annually to ensure that full cost recovery levels are identified.

Capital Improvement
Five-Year Capital Improvement Program (CIP)
The City shall annually prepare a capital improvement
spending program, projecting capital needs for a five-year period. This CIP shall be comprised of all the City’s funds.

The City has been working toward providing a reasonable regular contribution from the General Fund to capital
improvements without reducing services. The first year
of the five-year CIP will be consistent with, and adopted as a component of, the annual operating budget. In the
development of the Capital Improvement Program, the
operating costs associated with the capital project will be projected and considered in conjunction with the CIP.

Enterprise Fund Capital Improvements
Capital Improvements funded from the Enterprise Fund
shall be paid for in a combination of “pay-as-you-go”
financing and the use of long-term debt. The City shall periodically review its enterprise capital needs and
establish capital spending plans that are appropriate and reflect a combination of debt and “pay-as-you-go,” while attempting to keep the enterprise service rates competitive with those in the surrounding area.

Investment
The Investment Advisory Committee and City Council shall annually review and update, or modify as appropriate, the City’s investment policy. The policy shall be adopted by resolution of the City Council based upon the City staff and Investment Advisory Committee’s recommendations.

Reports on the City’s investment portfolio shall be
developed and presented to the City Council quarterly. City funds will be managed in a prudent and diligent manner
with emphasis on safety, liquidity, and yield, in that order.

Operating Budget
Balanced Operating Budget
It is the City’s policy to adopt a balanced budget where operating revenues and available resources are equal to or exceed operating expenditures. Any year-end operating surpluses will revert to unappropriated balances for use in maintaining reserve levels set by policy or available for capital projects and/or “one-time only” General Fund expenditures.
192
936 of 1111
Financial Policies
Budget Document
The budget document shall serve as the official financial plan for the City. It will serve as the policy document of the City Council for implementing Council goals and objectives.

The budget shall provide staff the resources necessary to accomplish City Council-determined service levels.

The City has two-year business plan development
procedures. The two-year business plan process requires that each department submit two one-year expenditure
plans and revenue estimates to be provided to the City
Council for approval. Only the first of the two-year budget will be adopted. The second year represents a projected plan which will be subject to amendment in the following year. In any budget cycle, to remain adaptable to changing economic and/or operational conditions, the City may
choose to develop a one-year plan instead of a two-year budget plan.

Budget Control and Accountability
Department heads are responsible for containing
expenditures within their budgeted appropriations as
approved by the City Council. Subsequent to the adoption of the budget, all additional changes to the budget that have a financial impact require City Manager and City
Council approval.

Activities of the General Fund, Special Revenue Funds,
Debt Service Funds, Proprietary, and Capital Funds are
included in the annual budget. The level of budgetary
control is the department within each fund.
193
937 of 1111
Financial Policies
Policy Status

ACCOUNTING
Benchmark
The City's accounting of financial systems shall be maintained in accordance with Generally Accepted Accounting Principles (GAAP), standards of the Governmental Accounting Standards Board (GASB), and the Government Finance Officers Association (GFOA).

Status Met
Benchmark It is the City’s goal to maintain accounting records, processes, and procedures in such a manner as to receive an unmodified audit opinion and to maintain a Certificate of Achievement for Excellence in Financial Reporting from the GFOA.

Status Met

RESERVE / SINKING FUND
Benchmark The General Fund’s Contingency Reserve will be maintained at 15% of the annual General Fund operating expenditure budget.

Status Met
Benchmark The General Fund’s Housing Set-Aside Reserve will be used to support affordable housing initiatives. Replenishment is at the discretion of the City Council, and usage requires Council authorization.

Status Met
Benchmark
The General Fund’s Budget Stabilization Reserves has a target level set at 15% of the General Fund budgeted revenues. This reserve will be replenished during economic growth periods and utilized to stabilize the budget and maintain core services during economic downturns
Status Met
Benchmark
The General Fund’s Pension Stabilization Reserve is established to mitigate impact of rising pension costs. It will be utilized to stabilize pension contribution and prevent unexpected increases in required pension contribution from affecting city service levels. Usage of this reserve requires City Council approval.

Status Met
Benchmark The City’s Sewer Enterprise Fund will maintain reserves equal to four months of operating expenses.

Status Met
Benchmark The City’s Construction Services Fund will maintain reserves equal to twelve months of budgeted operating expenditures.

Status Met
Benchmark The City will maintain Comprehensive Liability and Workers’ Compensation insurance reserves at no less than marginally acceptable confidence levels.

Status Met
Benchmark
Through the use of the Vehicle and Equipment Replacement Fund, the City will annually budget sufficient funds to provide for the orderly replacement of the City’s fleet, vehicles, computers, radios, equipment, technology infrastructure, and other major capital outlay.

Status Met
Benchmark Through the use of the Fleet and Building Maintenance Fund, the City will annually budget sufficient funds to provide for the orderly fleet and building maintenance and repair.

Status Met
Benchmark A sinking fund for building component/replacement will be maintained.

Status Annual baseline funding of $410,000 has been provided for HVAC, roofing, floor covering, and remodel projects. 194
938 of 1111
Financial Policies
DEBT
Benchmark It is the City’s goal for its general obligation (GO) bonds to maintain a AAA rating, and for the Sewer Enterprise to maintain a AA-/ Aa2 credit rating.

Status Met. GO Bonds rated AAA by S&P. Sewer Enterprise rated Aa2 by Moody's, AA- by S&P.

REVENUE
Benchmark Budgeted revenues will be estimated conservatively using accepted standards and estimates provided by the state, other governmental agencies, or reliable economic forecasters when available.

Status Met
Benchmark Property Transfer Tax is projected using a consistent methodology, which takes a long-term perspective to temper variance from year to year.

Status
Met. Property transfer tax is estimated at $8.0 million per year throughout the General Fund Long-Term Financial Plan, reflecting the expectation that the federal funds rate will gradually decline, and the lower interest rate environment will buoy the real estate market.

Benchmark Full cost recovery for user fees will be achieved.

Status Met. All charges for services are based on the cost of providing the services.

Benchmark Full cost recovery for indirect costs will be achieved.

Status Met
Benchmark The City shall actively pursue federal, state, and other grant opportunities when deemed appropriate.

Status Met. Continuing to assess and apply for grants with a focus on ensuring matching funds are identified, as applicable, and ongoing costs are considered.

CAPITAL IMPROVEMENT
Benchmark The City has been working toward providing a reasonable regular transfer from the General Fund to capital improvements without reducing services.

Status Met. The baseline General Fund transfer is $2.69 million to fund streets, building components, and sidewalk repair.

Benchmark Continue to use bond proceeds and other funding sources for capital projects.

Status Met. Examples are streets and flood control, golf course, wastewater treatment plant, library, and fire station.

INVESTMENT
Benchmark City funds will be managed in a prudent and diligent manner with emphasis on safety, liquidity, and yield; in that order.

Status Met

OPERATING BUDGET
Benchmark It is the City's policy to adopt a balanced budget, where operating revenues and available resources are equal to or exceed operating expenditures.

Status Met
Benchmark The City Manager shall annually prepare and present a proposed operating budget through two study sessions by no later than June of the prior fiscal year; and City Council will adopt said budget no later than June 30th of each year.

Status Met
Policy Status
195
939 of 1111
General Fund Reserves Policy
City of San Mateo, California
Financial Policy
General Fund Reserves
I. Purpose
The General Fund Reserve is established to ensure that the City of San Mateo (the City) can sustain municipal services during economic downturns, natural disasters and other major emergencies.

Three of the General Fund’s primary revenue sources are property tax, sales tax, and real property transfer tax. Sales tax and real property transfer tax are highly sensitive to economic cycles. While property tax remains stable, uncertainties around the property tax in-lieu of vehicle license fees (VLF) shortfalls and unfunded pension liabilities create additional long-term financial risks. Further, the City must be prepared for seismic and other catastrophic events that could threaten the City’s long-term fiscal health.

This policy outlines the management, usage, and replenishment of the General Fund reserves to ensure the City’s financial stability and sustainability.

II. Amounts Held in the General Fund Reserves
The General Fund Reserves are divided into five primary categories:

1. Contingency Reserve
The General Fund Contingency Reserve will be maintained at 15% of the General Fund budgeted operating expenditures. This reserve will only be utilized for extraordinary, one-time events that cause significant financial strain, such as natural disasters, public health crises, legal obligations, emergency infrastructure repairs, or major unforeseen non-financial emergencies as determined by the City Council. This reserve is not intended to address revenue losses due to normal economic cycles. City Council authorization is required for any use of this reserve.

2. Housing Set-Aside Reserve
In accordance with the approved Housing Element, 20% of RDA residual property tax will be allocated annually to the Housing Set-Aside Reserve at the discretion of the City Council. This reserve will be used to support affordable housing initiatives with City Council authorization.

3. Capital Improvement Projects (CIP) Carryover Reserve:

The General Fund CIP Carryover Reserve will hold funds budgeted for capital improvement projects that have not yet been transferred to the Capital Projects Fund. This reserve is designed to separate committed funds from the remaining General Fund reserves, to ensure effective financial planning and to prevent commingling of designated capital project funds with other reserves.

4. Budget Stabilization Reserve
The General Fund Budget Stabilization Reserve will be set at 15% of the General Fund budgeted revenues. This reserve is intended to stabilize the General Fund budget during economic downturns or unforeseen expenditure increases to maintain service levels. This reserve will be replenished during economic growth periods and utilized to stabilize the budget and maintain core services during economic downturns.
196
940 of 1111
General Fund Reserves Policy
The 15% target level serves as a goal range, not a minimum, recognizing that this reserve is intended to be used during economic downturns. It is expected that the balance may fall below 15% in challenging times, as the reserve is designed to help stabilize the budget and maintain essential services. If economic conditions or long-term financial risks warrant additional reserves, the City Council may temporarily increase the Budget Stabilization Reserve above 15% to strengthen the City’s financial position.

The Finance Director shall develop a General Fund long-range forecast and review General Fund reserve levels as part of the budget development process. If the Budget Stabilization Reserve is projected to fall below 10% in the next two budget cycles per the long-range forecast, the City Manager shall propose a plan to restore the reserve to the target level, subject to City Council approval.

5. Pension Stabilization Reserve
The General Fund Pension Stabilization Reserve is established to mitigate impact of rising pension costs and prevent unexpected increases in unfunded pension liabilities from affecting city services.

This reserve is intended to stabilize the City’s annual pension contributions to maintain service levels.

If pension cost uncertainty declines, the Finance Director shall propose options to adjust the reserve level based on the assessed risk, subject to City Council approval. Options may include making onetime discretionary payment to CalPERS to reduce the City’s unfunded pension liabilities.

Initial funding shall be determined at the discretion of the City Council. Additional funding may come from surplus funds, one-time revenues, or other unrestricted funding sources, subject to City Council approval.

Investment earnings generated from this reserve will be credited back to the reserve.

III. Unassigned Fund Balance
Unassigned fund balance represents the portion of General Fund balance that is not restricted, committed, or assigned to specific purposes, including the reserve requirements outlined above. It is the most flexible portion of the General Fund balance and is available at the discretion of the City Council.

This balance may serve as an additional cushion for unforeseen expenses. If the unassigned fund balance exceeds 10% of General Fund budgeted expenditures, the Finance Director shall propose options for City Council consideration as part of the budget development process. These options may include additional contributions to the Capital Investment Reserve, one-time capital improvements, pension liability reduction, or other long-term financial priorities. City Council authorization is required for any allocation of the excess funds.

IV. Annual Review of Policy
The General Fund Reserve policy will be reviewed at least annually with the development of each fiscal year’s budget. If changes are deemed necessary, to safeguard its effectiveness and relevance to the City’s long-term needs, or to ensure that the policy remains current with government financial best practices, changes to the policy may be authorized by the City Council at any time. 197
941 of 1111
Capital Investment Reserve Policy

City of San Mateo, California
Financial Policy
Capital Investment Reserve
I. Purpose
The Capital Investment Reserve is established within the Capital Projects Fund to finance major capital improvement projects that are critical to support municipal services. These projects may lack immediate funding or have funding not yet identified. This policy outlines how the Capital Investment Reserve will be funded and the conditions under which funds may be expended.

II. Funding the Reserve

1. Initial Funding:

City Council reviews and approves initial funding for the Reserve, with future additional funding made in subsequent years, generally from the General Fund budgetary surplus.

2. Additional Funding:

Additional contributions to the Reserve may be made from surplus funds, one-time revenues, proceeds from the sales of City properties, or other unrestricted funding sources. These contributions will require City Council approval. City staff will review the General Fund’s funding levels annually and make recommendations to transfer funds from the General Fund to the Capital Investment Reserve as part of the annual budget adoption process.

3. Interest Earnings:

Any interest earned from the Reserve will be credited to the General Fund.

III. Conditions for Use of Reserves

1. Expenditures:

Reserve funds may only be used for projects that are specifically authorized by the City Council.

These projects should be identified in the City's Capital Improvement Plan and must address critical unfunded capital needs. The reserve is not intended to cover operating expenditures or recurring costs.

2. Authority for Use:

Only the City Council can authorize the use of funds from the Capital Investment Reserve. The typical authorization process will occur with the adoption of the annual budget; however, Council can authorize the utilization of these funds at any other time through a resolution. This includes any inter-fund borrowing, which must be approved by the City Council, along with repayment terms.

IV. Annual Reporting
To ensure transparency and accountability, the Finance Director shall provide an annual report on the status of the Capital Investment Reserve. This annual report shall be presented to the City Council during a regularly scheduled financial update, such as the mid-year budget update or public hearings on the City’s budget. It shall include the reserve balance, contributions made during the fiscal year, expenditures, and if any, planned uses for future capital projects.

V. Annual Policy Review
This Policy will be reviewed annually during the budget process. The City Council may amend the policy at any time to ensure its effectiveness, alignment with the City’s long-term financial goals, or compliance with current best practices.
198
942 of 1111
Gann Appropriations Limit
CITY OF SAN MATEO APPROPRIATIONS LIMIT FOR FISCAL YEAR 2025-26 AMOUNT SOURCE A Last Year’s Limit $ 268,524,256 2024-25 Limit
B Adjustment Factors

1. Population 1.0009 CA Dept. of Finance

2. Inflation 1.0644 CA Dept. of Finance

1.0654 B1*B2
Total Adjustment % 0.0654 B1*B2-1
C Annual Adjustment $ 17,550,198 A*B
D This Year’s Limit $ 286,074,454 A+C
E Tax Proceeds Subject to the Limit
Property Tax $ 90,822,000 2025-26 Budget
Sales Tax 27,600,000 2025-26 Budget
Property Transfer Tax 8,600,000 2025-26 Budget
Other Tax 12,613,000 2025-26 Budget
Interest Allocation 6,030,000 2025-26 Budget
Total $ 145,665,000
Amount Under / (Over) Limit $ 140,409,454 D-E
City of San Mateo Gann Appropriations Limit as Defined in Article XIII B of the California State Constitution
The voters of California, during a special election in 1979, approved Article XIII-B of the California State Constitution.

Informally known as the “Gann Initiative,” Article XIII-B provides limits regarding the total amount of appropriations in any fiscal year from “the proceeds of taxes.”
In 1980, the State Legislature added Section 7900 et seq. to the Government Code, providing that the governing
body of each local jurisdiction must establish, by resolution, an appropriations limit for the following year. The
appropriations limit for any fiscal year was equal to the previous year’s limit, adjusted for population changes and the changes in the US Consumer Price Index (or California per capita personal income, if smaller). The necessary
statistical information is provided by the California
Department of Finance.

However, the original Article XIII-B (Proposition 4) and its implementing legislation were modified by Proposition 111 and SB 88 by the voters in June 1980. The changes were
incorporated into the fiscal year 1990-91 and fiscal year 1991- 92 appropriations limits. Beginning with the fiscal year 1990- 91 appropriations limit, a city may choose annual adjustment factors. The adjustment factors include the
growth in the California per capita income or the growth in the non- residential assessed valuation due to construction within the City and the population growth within the county or the city.

The table below provides the calculation for the
appropriations limit for fiscal year 2025-26, as well as the total appropriations subject to the limit. The adjustment factors utilized for the fiscal year 2025-26 calculation include the growth in California per capita income and the population growth within the County of San Mateo. As the table demonstrates, the City’s appropriations subject to the limit ($139.4 million) are well below the appropriations limit itself ($286.1 million).
199
943 of 1111
Budget Changes
Full Time Equivilant (FTE) Personnel Changes
DEPARTMENT ACTION 2025-26

PROPOSED POSITION/SERVICE ENHANCEMENTS FUNDING
SOURCE
FISCAL
IMPACT
Reallocate 1.0 FTE Assistant City Attorney to 1.0 FTE Senior Assistant City Attorney
Reallocating to provide a pathway for career advancement within the department.

Reallocate 1.0 FTE Systems Analyst ll to 1.0 FTE Senior Systems Analyst
Reallocating to provide a pathway for career advancement within the department. The additional costs of $25,000 will be offset by budget savings within the department
Add 1.0 FTE Human Resources Technician for a two-year limited term.

Support recruitment, onboarding, training and benefit
administration for the new Waste Water Treatment Plant.

Net Change to Merit Positions 1.0 FTE $ 166,500
Human Resources New 1.0 Sewer Fund 140,000
$ 26,500
Information Technology General Fund Net Zero
City Attorney Reallocate
Reallocate
-
-
General Fund
and
Comprehensive
Liability Fund
200
944 of 1111
Budget Changes
Non-Personnel Operating Changes

DEPARTMENT SERVICE ENHANCEMENTS FUND
2025-26

PROPOSED
BUDGET
City Manager's Office Community survey, polling, and communication services. General Fund $ 250,000 Information Technology Catergraph system renewal. General Fund 20,900 Information Technology Purchase Nutanix clusters. General Fund 20,900 Information Technology Cisco licensing cost. General Fund 37,708 Police Budget savings from Real Time Information Center (RTIC) General Fund (210,000) Police Axon contractual costs (RTIC/Fusus). Measure CC Fund 200,000 Police Per diem staffing need for the RTIC. General Fund 160,000 Police Overtime to meet staffing need for Youth Services General Fund 70,000 Police Overtime to meet staffing need for the Patrol Unit General Fund 300,000 Police To meet funding need for the annaul contract with San Mateo County for Animal Control Services General Fund 50,000
Public Works Expenditure controls and cost shift: Budget savings due to the negotiated office lease General Fund (135,000) Public Works Remaining funding needed to purchase electric sweeper in addition to C/CAG grant funding. Solid Waste Fund 631,000
Public Works Worker Resource Center Pilot Program: Additional cleaning services for Downtown and 25th Ave.

Solid Waste Fund 60,000
Solid Waste Fund 100,000
General Fund (100,000)
Advanced Planning
Fund
131,808
General Fund (131,808)
Public Works Enhancing cost recovery: Increase CIP Staff Chargeback to improve cost recovery for the General Fund
General Fund (1,000,000)
Public Works 1st year of mitigation plan design and development plan including joint agency lagoon general maintenance permit mitigation and reporting costs. Storm Fund 90,000 Public Works Increase budget to support the new WWTP facility coming online in FY 2025-26. Sewer Fund 772,200 Public Works Expenditure controls and cost shift: clean up budget no longer needed Fleet and Building Maint. Fund (130,000)
Public Works Increase budget for elevator maintenancce Fleet and Building Maint. Fund 50,000
Fleet and Building
Maint. Fund 120,000
General Fund (120,000)
Totals $ 1,237,708
Expenditure controls and cost shift: Transportation staffing costs related to implementation of the General Plan Update will be charged to the Advanced Planning Fund instead of the General Fund.

Expenditure controls and cost shift: Power washing of Downtown and 25th Avenues will be funded by the Solid Waste Fund instead of the General Fund.

Expenditure controls and cost shift: Reallocating City Hall Cal Water and PG&E charges to the Fleet and Building Maint. Internal Service Fund.

Public Works
Public Works
Public Works
201
945 of 1111
Equity Initiatives FY 24-25 Results
Department Equity Initiative Work Plan Status Update
City
Attorney’s
Office
Assist City staff
with municipal
code amendments
implementing DEI
framework
Prepare amendments to Community
Relations Commission (CRC), Senior Citizens
Commission ordinances. Draft code changes
allowing youth participation on additional
boards/committees.

Complete: staff prepared the code amendments allowing for youth participation on certain commissions which was adopted on September 3, 2024, and the code update to the CRC ordinance was adopted on the same day. Changes to the Senior
Commission ordinance were adopted on December 9, 2024.

City Clerk’s
Office
Broaden outreach
and recruitment
strategies for
Boards,
Commissions, and
Committees to
bolster inclusive
participation
reflecting the
diversity of the City
of San Mateo’s
community.
• Increase the number of applicants per
vacancy.
• Broaden the range of applicants by
engaging with individuals from
underrepresented groups.
• Utilize established partnerships and
explore new collaborations to advertise
and highlight vacancies.
• Inform the community about the City's
advisory committees and ways for
individuals to engage and take part in
these opportunities.

Complete: The City Clerk’s Office continued to advance its commitment to equity and inclusive civic engagement through its second full implementation of the Outreach Success Plan. This initiative focuses on expanding awareness of Boards,
Commissions, and Committees (BCCs) and increasing participation from underrepresented segments of the community. The 2025 spring recruitment cycle delivered measurable outcomes, most notably: A 78% increase in total applications compared to 2024 and a 368% increase compared to the 2023 recruitment cycle. 202
946 of 1111
Department Equity Initiative Work Plan Status Update
City
Manager’s
Office
Enhance
community
engagement and
dialogue with our
underrepresented
populations.

Evaluate and gather comprehensive input
from diverse neighborhoods, including
Asian, Pacific Islander, and Black
communities, and to strengthen
connections between residents and the City.

Complete: Over the past eight City Manager’s Office staff hosted a series of community conversations aimed at building stronger connections with its diverse populations, specifically the Asian/Pacific Islander, African American, and Latinx
communities—groups that have historically had less engagement with the City. These dialogues provided essential insights into the unique needs, challenges, and aspirations of these communities, helping to shape a clear vision for a more inclusive and vibrant San Mateo.

Key issues identified during the conversations included housing affordability, transportation, and traffic congestion. Additionally, residents expressed a strong desire for increased civic engagement opportunities and community events that foster stronger neighborhood connections.

Community
Development
Establish a CDD
Outreach and
Engagement Policy
that incorporates
the DEI Framework
Establish a consistent and reliable
framework which Incorporates DEI, for
hosting a community meeting
Complete: The Community Development Department established a consistent and reliable framework which Incorporates DEI, for hosting a community meeting.

As of May 27, 2025 the Department created a methodology and framework for an outreach plan incorporating many elements including a community meeting.

Finance Improve Finance
counter services for
business license
To enhance the process for obtaining a new
business license and managing annual
renewals, here are some improvements for
the work plan: (1) extend office hours; (2)
enhance the Finance Dept’s website to
provide clear step-by-step guides for
business license application and renewals,
and (3) for over-the-counter customers,
provide printed guides (in major languages)
that clearly outline the process, necessary
documents, and fees involved.

Complete: Effective October 21, 2024, the Finance Department extended its public counter hours from 8:00–11:30 AM and 1:00– 4:00 PM to 8:00 AM–12:00 PM and 1:00–4:30 PM. This change improves customer service availability for both residents and businesses.

Finance staff are enhancing the department’s website to include step-by-step guides for business license applications and renewals, along with multilingual PDF resources. For in-person visitors, staff are developing printed guides in major languages including Spanish, including large-print versions for improved visual accessibility.
203
947 of 1111
Department Equity Initiative Work Plan Status Update
Human
Resources
Update
recruitment
marketing and
outreach strategies
• Develop & implement ideas to expand
recruitment outreach and diversify the
City’s applicant pool, especially with
respect to youth and seniors.
• Work to attract and retain youth/young
adult interns by partnering with outside
organizations and centralizing internship
opportunities.

In Progress: The Human Resources Department is currently developing a proposal to establish a formal and customized “Recruitment, Marketing, and Outreach Plan” for the City of San Mateo. The purpose is to expand recruitment, marketing, and outreach activities in an effort to develop partnerships to build pipelines for City jobs and diversify the City’s applicant pool, including youth and seniors. Currently, we are in the planning phase in identifying options and developing work plans, timelines, and estimated costs.

Information
Technology
Implement a
Customer
Relationship
Management
system
Apply the DEI Strategic Framework to the
selection and implementation of a CRM that
will coordinate and manage citizen requests
Complete: Information Technology included DEI considerations in the selection of the product to be implemented for the Customer Relationship Management RFP. Specifically, the RFP asks vendors to provide the following features and functionality:
• Mobile device accessibility (for those without home
computers or Internet, but have access to a smartphone) • Accessibility compliance with WCAG 2.1 Level AA
standards to ensure accessibility for users with disabilities • Bilingual Public Support in both English and Spanish
• Enhanced Accessibility Features including support of
accessible attachments (e.g., tagged PDFs), high contrast themes, and allowance for text resizing without loss of functionality.

Information Technology also required the system allow City staff to enter cases for those who call or walk-in to a City location for help (people with no access to technology).
204
948 of 1111
Department Equity Initiative Work Plan Status Update
Library Strengthen and
expand outreach
services as well as
improve services to
neurodiverse
patrons.

Purchase new outreach van. Hire full-time
community services coordinator. Identify
underserved areas where we can expand
outreach.

Complete: The library has made efforts to successfully carry out their initiative. This can be seen through monthly outreach to Hillcrest Juvenile Hall and consistent engagement with English language learners in local public high schools help us connect with underserved youth. For the past year, children’s librarians have visited Peninsula Family Services and Intercommunal Preschool monthly to provide story times. They prioritize visits to preschools that are state subsidized. In addition, The Library has maintained a strong presence at local cultural and resource events, including the B Street Fiesta, AAPI Cultural Event, and Lunar New Year celebrations. These events allow The Library to build meaningful connections with residents across linguistic, cultural, and socioeconomic backgrounds who live in different parts of the city.

The Library has made an effort to offer programming in the North Central neighborhood with the bilingual cultural performance, San Mateo Juega, and an accompanying resource fair. The hiring of the new Community Services Coordinator greatly assisted the work for Juega and other San Mateo Celebrates events as we were able to effectively utilize volunteers. The new outreach van was purchased and The Library is in the process of designing a wrap for the vehicle.

Additionally, The Library partners with the SMC Veterans Outreach Group for monthly tabling at the library and participate in events such as the SMCO Veterans Christmas Event and the Veteran's Curation Program Networking Event. They are also enhancing our senior outreach through a new partnership with enABLE Care Management, launching our first collaborative program in July 2025. Librarians make visits to local senior housing such as the Villa Apartments to inform residents about library services and resources.

The Library's first Spanish-language gardening program was a success and reflects our commitment to expanding bilingual and culturally relevant programming. Outreach to the Peninsula Jewish Community Center and participation in school-based resource fairs further The Library's goal of reaching a wide range of communities. The children’s division added a Portuguese 205
949 of 1111
Department Equity Initiative Work Plan Status Update
storytime in February due to community interest. Now, the library has three monthly world language storytimes in Portugese, Polish, and Persian.

Teen programs are intentionally inclusive, welcoming
neurodiverse and neurotypical participants alike. Based on feedback from parents, they would like for their children to participate in programs that are open to everyone and not just neurodiverse teens. Staff participated in several trainings on neurodiversity. The children’s team made a connection with The Burkhard School, an independent school designed for
neurodivergent learners to thrive. They are hoping to visit the school soon to learn more about their services and how the library can provide support. In recognition of Autism Awareness Month the Children’s Division hosted Sally J. Pla, neurodiversity advocate and award-winning author on April 24. Sally conducted two morning school assemblies, at Sunnybrae Elementary and College Park Elementary as well as an evening event at the Main Library.

Parks &
Recreation
Change Title of
Senior Citizens
Commission to
Senior Advisory
Commission.

Change the Title of the Senior Citizens
COmmission to the Senior Advisory
Committee to be more inclusive.

Complete: In regard to Parks & Recreation, the Commission title was updated to "Senior Advisory Commission" following
evaluations of other agencies and input from resident surveys after the Commission shared the original Senior Citizens Commission title may be perceived as exclusive to citizens. On December 9, 2024, the Municipal Code was revised to include the title update and broaden the commission’s scope, orienting it to address city-wide projects and programs beyond focus on the San Mateo Senior Center. This initiative reflects the growing needs of the senior community across the city and allows increased input on City services.

Police Domestic Violence
Emergency
Response Team
(DVERT)
Incorporate DEI into the DVERT program.

Invite select community members to join
our working group to help us craft our
program (policy, training, hiring, etc.)
Complete: The Police Department, in close collaboration with the County and Community Overcoming Relationship Abuse (CORA), has continued to advance the Domestic Violence Emergency Response Team (DVERT) co-response model. This innovative 206
950 of 1111
Department Equity Initiative Work Plan Status Update
Ensure that the program evaluator includes
DEI in the evaluation, with a heavy emphasis
on community feedback on the program's
progress.
partnership strengthens our collective response to domestic violence by integrating trauma-informed, survivor-centered practices.

In alignment with our commitment to Diversity, Equity, and Inclusion (DEI), we are incorporating DEI principles throughout all facets of the DVERT program, including policy development, training, and hiring practices. To ensure authentic community representation, we have initiated the formation of a working group that includes select community members who will provide guidance and feedback as the program evolves.

Additionally, the program evaluator has been directed to include DEI as a core component of the evaluation framework, with a strong emphasis on collecting and incorporating community feedback on the program’s progress and impact.

Following an exhaustive recruitment effort, a promising candidate for the DVERT role has been identified. A comprehensive background investigation is currently underway and is expected to be completed shortly.

Public Works Deploy feminine
hygiene products in
all City staff
bathrooms.

Identify all city staff bathrooms that
currently don’t have supplies of feminine
hygiene products. Facilities staff to procure
and install the necessary hardware for
distribution. Amend/revise janitorial
services contract to include provision of
appropriate supplies for all restrooms going
forward.

In Progress: Public Works Facilities staff have installed equipment for provision of feminine hygiene products in approximately 30% of City facilities to-date and provision of products via the custodial contract is incorporated into the new custodial agreement that starts on July 1. Facilities staff will continue deploying the distribution equipment after budget is replenished on July 1 with adoption of the FY 2025-26 operating budget. 207
951 of 1111
Glossary
Appropriation
An authorization granted by the City Council to make
expenditures and to incur obligations for specific purposes.

Audit
A review of the City’s accounts by an independent
accounting firm to verify that the City’s financial statements accurately reflect the City’s financial position.

Base Budget
Estimate of the funding level, excluding limited term items, required to continue existing service levels during the next fiscal year.

Budget
A comprehensive financial plan of operation embodying an estimate of proposed expenditures for a given period and the proposed means of financing them.

Capital Acquisitions
Items of a permanent or semi-permanent nature that last multiple years.

Capital Improvements
A permanent major addition to the City’s real property
assets including the design, construction, purchase, or major renovation of land, buildings, or facilities. Examples are the installation or repair of new or existing streets, traffic signals, sewer lines, roads, and parks.

Capital Improvement Program (CIP)
An ongoing plan of single and multiple-year capital
expenditures, which is updated annually.

Compensated Absences
An employee’s paid time off of work, which can consist of elements such as vacation time and sick leave.

Debt Service
The payment of interest and principal on borrowed funds.

Deficit
The result of an excess of expenditures over resources.

Department
A major administrative division of the City with overall management responsibility for an operation or a group of related operations within a functional area.

Depreciation
(1) Expiration in the service life of capital outlay assets attributable to wear and tear, deterioration, action of the physical elements, inadequacy, or obsolescence; (2) the portion of the cost of a capital asset that is charged as an expense during a particular period.

Division
An organizational subunit of a department which
encompasses a substantial portion of the duties assigned to a department.

Encumbrance
A commitment of funds for goods or services for which the expenditure has not yet occurred.

Enterprise Fund
A fund established to account for operations of the City that are financed and operated in a manner similar to private business enterprises.

Expenditure
The amount of cash paid or to be paid for services
rendered, goods received, or an asset purchased.

Fiscal Year
The twelve-month period to which the annual budget
applies. In San Mateo, this period of time is July 1 through June 30.

Full Time Equivalent (FTE)
Conversion of a position to full-time equivalent. For
example, one person working half time would count as 0.50 FTE; one person working full time would count as 1.00 FTE.

Fund
A separate, independent accounting entity used to set forth the financial position of operations related to the specific purpose for which the fund was created. Examples of funds used in the City of San Mateo are the General Fund, Capital Projects Fund, and Sewer Fund.

Fund Balance
The total dollars remaining in a fund after current
expenditures for operations and capital improvements are subtracted.

General Fund
The City’s principal operating fund, which is supported by general taxes and fees and which can be used for any legal governmental purpose.
208
952 of 1111
Grant
A contribution by a government or other organization to support a particular function or project. Grants may be classified as either categorical or block, depending upon the amount of discretion allowed the recipient.

Interdepartmental Charges and Credits
A mechanism through which one program may bill another
program (charges) and be reimbursed (credits) for the cost of various services provided. Interdepartmental charges and credits are based on the actual, direct costs of the service provided. They function as cost allocation tools, allowing the financial reports to more accurately reflect the real cost of individual programs.

Interfund Transfers
The movement of money from one fund to another to cover certain costs.

Internal Service Fund
A fund which is used to finance and account for goods and/ or services provided by one City department to other City departments on a cost-reimbursement basis.

Non-departmental
Program costs that do not relate to any one particular
department, but represent costs of a general, City-wide nature.

Non-recurring Costs
One-time activities for which the expenditure should be budgeted only in the fiscal year in which the activity is undertaken.

Operating Budget
Annual appropriation of funds to support ongoing program costs, including employee services, maintenance, supplies, and equipment.

Ordinance
A formal legislative enactment by the City Council,
which has the full force and effect of law within the City boundaries unless it is in conflict with any higher form of law, such as a state statute or constitutional provision.

Program
An activity or group of activities which is an operational subunit of a department and is directed toward providing a particular service or support function. Each City
department may be responsible for a number of programs.

Proprietary Fund
A term also used to describe funds that are accounted for on a “flow of economic resources” measurement basis and on a full accrual accounting basis. Enterprise funds and internal service funds are classified as proprietary funds.

Reserve
Funds set aside for specific purposes.

Resolution
A special order by the City Council which requires less legal formality than an ordinance in terms of public notice prior to approval.

Resources
Total amount available for appropriation, including
estimated revenues, beginning fund balances, and fund
transfers.

Revenue
Income received during the fiscal year from taxes, fees, permits, franchises, interest, intergovernmental, and other sources.

Special Revenue Fund
A fund used to account for revenue sources that are
restricted by law or administrative action to expenditures for specified purposes.

Structural Deficit
The permanent financial gap that results when ongoing
revenues do not match or keep pace with ongoing
expenditures.

Glossary
209
953 of 1111
Proposed
2025-26 Budget
&
2025-30 Capital
Improvement Plan
June 16, 2025
1 954 of 1111
Budget Timeline
Budget
Kickoff
February 18
2024-25 Mid-Year
Updates
April 7
General Fund Reserve
Policy Study Session
April 21
Budget Preview
June 2
Proposed Budget
1 st Public Hearing
June 16
Budget Adoption
2 nd Public Hearing
2 January 2025 February 2025 April 2025 June 2025
955 of 1111
FY 2025-26 Citywide Budget (in millions)
3 Proposed FY 2025-26
Citywide Budget
$333.5 million
956 of 1111
General Fund
FY 2025-26 Proposed Budget - Expenditures
4 FY 2025-26
Proposed Budget
General Fund Expenditures
$187.7 million
35%
21%
13%
5%
5%
1%
10%
3% 7%
Police
Fire
Recreation and Parks
Library
Public Works
Community Dev
General Admin
Non-Departmental
Transfers Out
957 of 1111
General Fund
FY 2025-26 Proposed Budget - Revenues
5 FY 2025-26
Proposed Budget
General Fund Revenues
$175.8 million
958 of 1111
General Fund
FY 2025-26 Proposed Budget
6 General Fund (in millions)
2024-25
Adopted
Budget
2025-26
Original
Proposed
Budget
2025-26
Revised
Proposed
Budget
FY 25 vs. FY26
Change in $
FY 25 vs. FY26
Change in %
Total Revenues A $ 169.9 $ 172.5 $ 175.8 $ 5.9 3.5%
Expenditures:

Personnel Costs 79.7 80.7 80.7 1.0 1.3%
Pension Unfunded Liability (UAL) 13.0 13.6 13.6 0.6 4.6% Other Operating Expenditures 40.1 42.3 42.3 2.2 5.5%
SMC Fire and Legacy Costs 36.1 38.8 38.8 2.7 7.5%
Total Operating Expenditures B 168.9 175.4 175.4 6.5 3.8% Transfer for Debt Service C 3.0 3.0 3.0 - 0.0%
Transfer to Other Funds D 0.4 0.4 0.4 - 0.0%
Surplus / (Deficit) before Contribution to CIP E = A - (B+C+D) (2.4) (6.3) (3.0) (0.6) Less: Transfer to Capital Projects Fund F 8.1 8.9 8.9 0.8 9.9% Surplus / (Deficit) G = E - F $ (10.5) $ (15.2) $ (11.9) $ (1.4) 959 of 1111
General Fund Reserves
7 GENERAL FUND (in millions)
2024-25

YEAR-END

PROJECTION
2025-26

PROPOSED
BUDGET
Beginning Fund Balance $ 117.9 $ 114.8
Total Revenues 176.6 175.8
Total Expenditures, including transfers (179.7) (187.8) Net Change to Fund Balanc - surplus / (deficit) (3.10) (12.00) Ending Fund Balance $ 114.8 $ 102.8
Transfer to Capital Investment Reserve (25.0)
Ending Fund Balance- estimated $ 77.8
960 of 1111
8 FY 2025-26 Proposed Capital Budget
and
Five-Year Capital Improvement Plan (CIP)
961 of 1111
FY 2025-26 Proposed Capital Budget
and Five-Year CIP
The following is a breakdown of CIP expenses by program areas:
9 CAPITAL PROJECTS
2025-26

PROPOSED
BUDGET
2026-27
PLAN
2027-28
PLAN
2028-29
PLAN
2029-30
PLAN
5-Year
TOTAL
Bikeway/Pedestrian $ 4,098,820 $ 5,563,636 $ 1,575,000 $ 865,000 $ 865,000 $ 12,967,456 Bridges 75,000 75,000 75,000 - - 225,000
Facilities 5,878,742 4,310,000 3,360,000 4,010,000 6,575,000 24,133,742 Parks 6,391,822 2,695,000 6,345,000 1,845,000 2,625,000 19,901,822 Sanitary Sewer and
Wastewater
Management
29,089,000 28,996,805 37,544,930 25,384,035 31,311,652 152,326,422 Stormwater 250,000 1,050,000 700,000 700,000 700,000 3,400,000 Street Lights 700,000 1,000,000 - - - 1,700,000
Streets 9,240,473 8,818,000 9,003,000 8,203,000 8,203,000 43,467,473 Traffic 1,325,000 550,000 350,000 1,050,000 350,000 3,625,000 Other City Capital
Projects 4,492,000 1,002,000 927,000 927,000 927,000 8,275,000 Total $ 61,540,856 $ 54,060,441 $ 59,879,930 $ 42,984,035 $ 51,556,652 $270,021,914 962 of 1111 City Council Actions
10 Adopt resolutions to approve
• Fiscal Year 2025-26 Operating and Capital Budgets;
• Fiscal Year 2025-26 Gann Appropriations Limit;
• Fiscal Years 2025-30 Capital Improvement Program; and • $25 million initial contribution to the Capital Investment Reserve. 963 of 1111
Thank you
Karen Huang
Finance Director
[email protected]
650-522-7110
11 964 of 1111

CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 40 Section Name: PUBLIC HEARING Account Number: 10-4679 File ID: 25-9958 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: Public Works Department
MEETING DATE: June 16, 2025
SUBJECT:

Community Flood and Storm Protection Fee Increase for Fiscal Year 2025-26 — Adoption RECOMMENDATION:

Conduct a public hearing and adopt a Resolution to increase the Community Flood and Storm Protection Fee by 2.4 percent to account for the annual Consumer Price Index (CPI) increase.

BACKGROUND:

The City of San Mateo operates and maintains a stormwater system that provides vital services to protect neighborhoods from flooding and safeguard local waterways from pollution. This system comprises complex infrastructure, including surface drains, underground pipes and conduits, pump stations, creeks and channels, and the Marina Lagoon.

Improvements are needed to address flood control capacity limitations, aging infrastructure, enhanced operations and maintenance, and compliance with state and federal mandates to reduce pollutants in stormwater runoff.

The City’s stormwater system requires long-overdue upgrades to improve flood control and replace aging infrastructure.

Prior to 2024, the system lacked a dedicated funding source, and available funds were insufficient to adequately maintain and upgrade the drainage system.

On July 17, 2023, the City Council approved and adopted the Stormwater Fee Report, which outlines the financial requirements for implementing citywide stormwater improvements. At that meeting, the Council directed staff to initiate a Proposition 218 process to establish a new property-related fee. On January 16, 2024, following a two-month balloting process, the City Council certified the results of the vote and ordered the levying of the Community Flood and Storm Protection Fee (Stormwater Fee) for Fiscal Year 2024–25.

Beginning in Fiscal Year 2025–26 and for all future years, the Stormwater Fee is subject to an annual adjustment based on the Consumer Price Index for All Urban Consumers (CPI-U) for the San Francisco Bay Area, as of each December, with a maximum allowable increase of 3 percent. The CPI increase from December was 2.4 percent. Furthermore, any portion of the CPI above 3 percent is to be reserved as “Unused CPI” and may be applied in future years when the CPI is less than 3 percent. Since the CPI increase this year was below the cap, no Unused CPI will be banked. Pursuant to California Health & Safety Code Section 5473.1, the City Council must hold a public hearing before approving this annual adjustment.

The following table shows the proposed changes in monthly fees for Fiscal Year 2025-26.

Land Use Category Monthly Fee
Residential Cost (per parcel) FY 24/25 FY 25/26
Small Under 0.11 acre 5.55 5.68
965 of 1111

CITY OF SAN MATEO
Medium 0.11 to 0.17 acre 8.00 8.19
Large 0.18 to 0.23 acre 9.92 10.16
Extra Large Over 0.23 acre 11.08 11.35
Condominium 1 Level acre 5.35 5.48
Condominium 2+ Levels acre 2.71 2.78
Non-Residental (per acre) FY 24/25 FY 25/26
Commercial / Industrial 100.50 102.91
Office / Apartment / Institutional 81.82 83.78
Institutional w/Field 71.24 72.95
Park 5.53 5.66
Vacant (developed) 5.53 5.66
Open Space / Agricultural not charged
Funds from the Community Flood and Storm Protection Fee for the initial FY 2024–25 have been allocated to support operations and maintenance staff in the ongoing cleaning of storm catch basins, as well as critical capital improvements for minor storm drain “hotspot” repairs at several locations identified by engineering and operations staff.

Future revenues from this fee will continue to support these functions, along with major capital improvements to be identified in the upcoming Storm Drain Master Plan update and Marina Lagoon dredging projects. Staff will present the updated Master Plan to the City Council later this year for review of the proposed capital improvements.

Staff recommends that the City Council adopt the attached Resolution to increase the Community Flood and Storm Protection Fee by 2.4 percent for all parcels citywide.

BUDGET IMPACT:

Revenues from Community Flood and Storm Protection Fee for Fiscal Year 2024-25, after minor corrections to individual parcels, totaled $3,903,989.57. The proposed CPI increase of 2.4 percent will increase anticipated Fiscal Year 2025-26 revenue in the Storm Fund by approximately $93,700, for an estimated total of $3,997,700.

ENVIRONMENTAL DETERMINATION:

This Council action adopting a Resolution to establish the Community Flood and Storm Protection Fee rate for Fiscal Year 2025-26 is not a project subject to CEQA, because it consists of a government funding mechanism or other government fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment. (CEQA Guidelines Section 15378(b)(4).)

NOTICE PROVIDED
Pursuant To Government Code Section 6066, notice of the public hearing was published twice in the San Mateo Daily Journal on May 30, 2025, and June 6, 2025, respectively.

ATTACHMENTS
Att 1 – Proposed Resolution

STAFF CONTACT
Jimmy Vo, Engineering Manager
[email protected]
(650) 522-7319
966 of 1111

CITY OF SAN MATEO
RESOLUTION NO. ____ 2025
ADOPTING INCREASES TO COMMUNITY FLOOD AND STORM PROTECTION FEE FOR FISCAL YEAR 2025-26 WHEREAS, the City Council reviews the fees for the City of San Mateo’s (City) Community Flood and Storm Protection Fee (hereafter “Stormwater Fee”); and
WHEREAS, the City operates and maintains a stormwater system that provides vital services to protect neighborhoods from flooding and safeguard local waterways from pollution; and WHEREAS, the City’s stormwater system requires long-overdue upgrades, and, prior to 2024, the system lacked a dedicated funding source; and
WHEREAS, on January 16, 2024, the City Council certified the results of the vote and ordered the levying of the Community Flood and Storm Protection Fee (Stormwater Fee) for Fiscal Year 2024–25; and WHEREAS, for Fiscal Year 2025–26, the Stormwater Fee is subject to an annual adjustment based on the Consumer Price Index for All Urban Consumers (CPI-U) for the San Francisco Bay Area, as of each December, with a maximum allowable increase of 3%; and
WHEREAS, for Fiscal Year 2025–26, the CPI increase from December was 2.4%.

NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF SAN MATEO, CALIFORNIA, HEREBY RESOLVES that:

1. Adoption of the Stormwater Fee rate for Fiscal Year 2025-26 is not a project subject to CEQA, because it consists of a government funding mechanism or other government fiscal activity which does not involve any commitment to any specific project which may result in a potentially significant physical impact on the environment. (CEQA Guidelines Section 15378(b)(4).)

2. The City Council hereby approves and adopts the Stormwater Fee Rate for Fiscal Year 2025-26, inclusive of the CPI increase of 2.4%, as follows:

Land Use Category Monthly Fee
Residential Cost (per parcel)
FY
24/25 FY 25/26
Small Under 0.11 acre 5.55 5.68
Medium 0.11 to 0.17 acre 8.00 8.19
Large 0.18 to 0.23 acre 9.92 10.16
Extra Large Over 0.23 acre 11.08 11.35
Condominium 1 Level acre 5.35 5.48
Condominium 2+ Levels acre 2.71 2.78
967 of 1111
Non-Residental (per acre)
FY
24/25 FY 25/26
Commercial / Industrial 100.50 102.91
Office / Apartment / Institutional 81.82 83.78
Institutional w/Field 71.24 72.95
Park 5.53 5.66
Vacant (developed) 5.53 5.66
Open Space / Agricultural not charged
968 of 1111
Proposed Fee Increase for Fiscal
Year 2025-26
June 16, 2025
1 Community Storm Flood and
Protection Fee
Presented By: Public Works – Jimmy Vo, Engineering
Manager
969 of 1111
City Council to review and adopt the proposed fee
increases for the Community Storm Flood and
Protection Fee for Fiscal Year 2025-26.
2 Purpose
970 of 1111
3 Background
• City Council adopted the new Stormwater Fee on January 16, 2024
• Staff to bring future annual adjustments to City Council for approval
• Annual adjustments are based on the Consumer Price Index (CPI) for the Bay Area with an annual cap of 3%*
• For the upcoming Fiscal Year, the CPI will be 2.4%
971 of 1111
4 Proposed Fee Increases
Land Use Category Monthly Fee
Residential Cost (per parcel) FY 24/25 FY 25/26
Small Under 0.11 acre 5.55 5.68
Medium 0.11 to 0.17 acre 8.00 8.19
Large 0.18 to 0.23 acre 9.92 10.16
Extra Large Over 0.23 acre 11.08 11.35
Condominium 1 Level 5.35 5.48
Condominium 2+ Levels 2.71 2.78
Non-Residential (per acre) FY 24/25 FY 25/26
Commercial / Industrial 100.50 102.91
Office / Apartment / Institutional 81.82 83.78
Institutional w/Field 71.24 72.95
Park 5.53 5.66
Vacant (developed) 5.53 5.66
Open Space / Agricultural not charged
972 of 1111
5 Projected Revenue Estimates
• Projected revenue for Fiscal Year 24-25 was about $4.05M • Actual revenue for Fiscal Year 24-25 was about $3.90M • With the 2.4% increase, projected revenue for Fiscal Year 25-26 will be approximately $4.00M
973 of 1111
City Council to review and adopt the proposed fee
increases for the Community Storm Flood and
Protection Fee for Fiscal Year 2025-26.
6 Purpose
974 of 1111

CITY OF SAN MATEO

CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 41 Section Name: OLD BUSINESS Account Number: 10-1311 File ID: 25-10024 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Manager's Office
MEETING DATE: June 16, 2025
SUBJECT:

Electrify San Mateo: Sustainable Building Strategy — Policy Feedback RECOMMENDATION:

Receive an informational report on the "Electrify San Mateo: Sustainable Building Strategy" project and provide direction on the policy pathways for inclusion in the final Sustainable Building Strategy.

BACKGROUND:

Building energy use represents 38 percent of communitywide greenhouse gas emissions in San Mateo. Building electrification refers to the transition from gas equipment to electric equipment for space and water heating, clothes drying, cooking, and more. While natural gas is a fossil fuel, Peninsula Clean Energy (PCE) provides carbon-free electricity communitywide. Electrifying existing buildings is critical to reducing communitywide greenhouse gas emissions and is a key strategy in attaining the objectives contained in City’s adopted Climate Action Plan. To continue to advance existing building electrification beyond reach codes and to meet the City Council decarbonization priority, City staff began working with Rincon Consultants to develop the Electrify San Mateo: Sustainability Building Strategy. This project aims to create an actionable roadmap with steps for the City of San Mateo to electrify buildings based on effectiveness and equity criteria, cost-effectiveness, best available science and data, and community feedback. The project team completed a building inventory and market segmentation analysis that was presented at the September 13, 2023, Sustainability and Infrastructure Commission meeting. After completing Phase I of community engagement, the project culminated in the identification of five policy pathways that were presented at the January 16, 2024, City Council meeting. City Council directed the project team to conduct community engagement on all five policy pathways to determine overall feasibility and support from the community. This report provides an overview of the project, analysis of the five policy pathways that will be considered by City Council and a summary of project community engagement.

Building Electrification Background
Electrification benefits include the added health benefit of reducing gas use in the home. Commonly used appliances that burn gas, including stoves, heating systems, and water heaters, emit hazardous air pollutants inside a home when improperly ventilated, or when leaks occur. These can include benzene, nitrogen oxides, sulfur oxides, carbon monoxide, formaldehyde, particulate matter and other harmful pollutants that increase the risk of respiratory disease such as asthma. Additionally, gas infrastructure carries an inherent safety risk due to the volatile nature of gas, including risk of methane leakage, damage during earthquakes, accidental explosions, or fires.

Building electrification is also an essential approach to driving the state of California toward its ambitious climate goal of carbon neutrality by 2045. Additionally, at the regional level the Bay Area Air District (BAAD) adopted zero nitrogen oxides (NOx) standards that will prohibit the sale and installation of gas water heaters starting in 2027 and gas furnaces in 2029 in the nine-county Bay Area. These standards are the most ambitious in the country and outpace the state’s goal of banning the sale of new gas furnaces and water heaters throughout the state starting in 2030. 975 of 1111

CITY OF SAN MATEO
As part of the FY 2022-2023 goal setting session, the City Council directed staff to present to them policy options to decarbonize and electrify existing buildings and eliminate natural gas use by 2030. The City’s Climate Action Plan also identifies electrifying existing buildings as a key strategy to reduce communitywide greenhouse gas emissions. The City has shown great leadership in advancing building electrification through the adoption of local amendments to the state building code also known as reach codes. In 2020, the City Council adopted a reach code requiring all new residential and office buildings be all-electric starting on January 1, 2021. In 2022, the City Council adopted a reach code that expanded the allelectric requirement to all new buildings and requiring electric-readiness and electric appliances for specific home remodels that started on January 1, 2023. In 2024, due to a federal court decision, the City suspended the enforcement of its reach codes that prohibit the installation of new gas infrastructure. The Ninth Circuit Court of Appeals in California Restaurant Association v. City of Berkeley determined that a local ordinance that generally prohibited the installation of natural gas infrastructure was preempted by federal law, namely the Energy Policy and Conservation Act (EPCA). In January 2025, the San Mateo City Council adopted an Energy Performance Reach Code for new construction that requires energy compliance margins for new buildings and repealed the unenforceable all-electric requirement.

Policy Pathways
The project team gathered feedback on five existing building electrification policy pathways. These policy pathways are meant to be considered as a menu of options to achieve the City’s climate goals, while considering implementation and cost challenges for property owners across the City. Most local governments considering a building decarbonization strategy combine multiple strategies together to produce the most comprehensive, and equitable policy result. The following provides a high-level summary of the policy pathways. The Policy Pathways Analysis attachment provides detailed discussion of each policy pathway including advantages and challenges of policy implementation, greenhouse gas emission reduction impact, cost effectiveness and equity considerations.

1. Business as usual: The City could continue with adopting reach codes for new construction and focus on outreach and incentives. In the past, the City adopted local building code amendments to require more sustainable new construction than the State code. This approach has a limited impact because new construction accounts for a fraction of San Mateo’s development, however, this approach is already in place and thus received community support to date. There are no policy-related additional costs to building owners unless they voluntarily decide to electrify. A Zero NOx new construction approach would save an estimated 1,770 MT CO2e per year by 2030 while a performance approach would save 20 MT CO2e per year by 2030.

2. Reach codes for renovations: This approach would include the evaluation of additional reach codes to encourage and/or require electrification during renovations. New reach codes would vary depending on the updated State codes. One example of a reach code during renovations is requiring the installation of a heat pump when an air conditioner is installed. Reach codes during renovations help encourage electrification at an opportune time when a property owner is already considering home improvements. The upfront costs of electrification improvements can vary depending on the project and unique circumstances of your home. Costeffectiveness studies must be completed to validate any adopted reach codes. Past studies have shown on-bill savings over time make electric equipment upgrades cost-effective compared to gas equipment replacements.

Two-Way AC reach code would reduce emissions by 2,200 MT CO2e per year by 2030, while a Flex Path reach code would reduce emissions by approximately 730 MT CO2e per year by 2030.

3. Require electric equipment upon replacement ahead of BAAD Zero NOx requirements: The Bay Area Air District (BAAD) adopted zero nitrogen oxides (NOx) standards that will prohibit the sale and installation of gas water heaters starting in 2027 and gas furnaces in 2029 in the nine-county Bay Area. A local ordinance ahead of these milestones would require the replacement of gas appliances with zero NOx versions when they fail or are voluntarily upgraded. This policy would have the most significant greenhouse gas emission reductions of the five policy pathways with an estimated 9,700 MTCO2e per year by 2030. 976 of 1111

CITY OF SAN MATEO

4. Commercial Building Performance Standards: This pathway would establish a new set of policy standards for commercial buildings aimed at increasing energy efficiency, and eventually, electrifying commercial buildings as a phased approach. This is a well-established policy mechanism that has been adopted by many local governments across the country. This approach can be customizable and lead to incremental reductions in energy use but not necessarily electrification. The development of such a local program would necessitate new staff time. Emissions reductions will likely not occur before 2030 due to the phased nature of the program.

Commercial buildings account for 16 percent of communitywide emissions (83,660 MTCO2e) and thus represent an important opportunity for GHG reduction.

5. Municipal Electric First Policy: This policy establishes a mechanism for local government renovations to go electric first. The policy ensures financial, and feasibility data is being collected for municipal facilities that will allow the City to compare costs to electrify versus replacing with gas equipment. This policy has a limited reach as it only applies to municipal buildings. It demonstrates City leadership on hard-to-electrify existing buildings that mirror the commercial sector. This policy is estimated to reduce emissions 146 MT CO2e by 2030.

Community Engagement
The project team conducted two phases of project outreach. The first phase of community engagement focused on educating the community about the costs and benefits of building electrification and about the project’s general goals.

Outreach also focused on gathering feedback on the equity and effectiveness criteria the project team would use to evaluate policy pathways. The top concerns were costs, power outages and grid resilience, and the growth of the grid to accommodate future electric buildings. The top values were how the climate crisis is a priority issue, the need for the City to act now, and the availability of electric equipment incentives and rebates.

The second phase of community engagement aimed to get specific feedback on the five policy pathways as directed by City Council in January 2024. The project team conducted presentations at a variety of in-person and virtual community meetings, City Commission meetings, engaged with commercial property owners and developers, and conducted an online survey. Throughout both phases of engagement, the project team heard from individuals with strong opinions on building electrification policy. While many community members continue to be highly supportive of local action, others are firmly opposed to additional local policy. Throughout the second phase of community engagement, the project team provided 9 presentations and reached over 150 people through in-person and virtual events. In addition, over 200 people responded to the online feedback survey and staff maintains a list of over 200 emails of community members and stakeholders interested in this project.

At the May 14, 2025, Sustainability and Infrastructure Commission meeting, the project team presented the five policy pathways, along with community feedback obtained up until that point in time, and commissioners provided feedback.

Commissioners supported policy pathways 1, 2, 4 and 5 to advance existing building decarbonization and meet climate goals. Commissioners noted the importance of funding to help homeowners with the transition, suggested the City help provide funding and emphasized the importance of PCE’s Loan program. Commissioners also recommended the incorporation of a hardship exemption into potential ordinance language to address cases that are hard-to-electrify. Two commissioners expressed interest in Option 3 Zero NOx standards ahead of the Bay Area Air District but noted that both the timeline for this policy and enforcement would be very challenging.

The project team also gathered feedback from the Senior Advisory Commission on May 12, 2025, and the Community Relations Commission on May 21, 2025, which is charged with providing the City’s DEI lens. The Senior Advisory Commissioners voiced concerns about the upfront costs of electrification but there was some consensus and support over the intent of building decarbonization and of Options 4 and 5. The Community Relations Commission discussed various ways to improve marketing to various community groups and emphasized the importance of equitable transition in existing building decarbonization. The Community Relations Commission unanimously supported all five policy pathways.

In summary, the project team found:
977 of 1111

CITY OF SAN MATEO
• Option 1 Reach Codes for New Construction (Business as Usual), Option 4 Commercial Building Performance Standards and Option 5 Municipal Electric First Policy received the most community support. • Option 3 Zero NOx Standards ahead of the Bay Area Air District, received the least amount of community support. • Option 2 Reach Codes for Renovations received a mix of support and opposition.

Detailed community feedback and survey results for each project phase are provided in the Community Engagement Summary attachment. Detailed community feedback as related to each policy pathway is provided in the Policy Pathways Analysis attachment.

Next Steps
Staff seeks City Council direction on which of the five policy pathways to include in the final “Electrify San Mateo:

Sustainable Building Strategy.” Specifically, does the Council recommend inclusion of:
• Option 1 Reach Codes for New Construction (Business as Usual) —most strongly supported, • Option 2 Reach Codes for Renovations—mix of support and opposition, • Option 3 Zero NOx Standards ahead of the Bay Area Air District—not well supported, • Option 4 Commercial Building Performance Standards—most strongly supported, or • Option 5 Municipal Electric First Policy—most strongly supported.

The City Council can recommend inclusion of a subset of policy pathways or recommend inclusion of all policy pathways in the Sustainable Building Strategy. After City Council provides direction, the project team will compile the policy pathways into a final document that will incorporate the project work completed to date including building and market segmentation analysis and electrification cost analysis. The project team aims to bring the final document for adoption at an upcoming City Council meeting, which could be July 28, 2025, depending on the options selected.

BUDGET IMPACT:

The development of the "Electrify San Mateo: Sustainable Building Strategy" was funded by an appropriation from the available fund balance in the Advance Planning Fund (Fund 225) and had no impact on the City's General Fund.

The different policy pathways presented in this report have varying budget impacts for implementation. The implementation of reach codes (Options 1 and 2) is integrated within existing City processes for planning application, plan check and building permit review. The enforcement of Option 3 would also be integrated within City’s permit issuance process. The implementation of Option 4 would be the most resource-intensive of the five policy pathways and would require staff time for the development of an ordinance and to staff the new program moving forward. The cost impacts of Option 5 would vary depending on the facility equipment replacement needs; technical assistance programs, grants and rebates are available to support municipal electrification.

ENVIRONMENTAL DETERMINATION:

This informational report is not a project subject to CEQA, because it can be seen with certainty that it will not cause a physical change in the environment. (Public Resources Code Section 21065.)

NOTICE PROVIDED
All meeting noticing requirements were met.

ATTACHMENTS
Att 1 – Public Comment
Att 2 – Policy Pathways Analysis
Att 3 – Community Engagement Summary

STAFF CONTACT
Andrea Chow, Sustainability Analyst
[email protected]
(650) 522-7007
978 of 1111
From: ahouye
To: Andrea Chow
Subject: Re: Reminder: Electrify San Mateo: Upcoming Community Meetings Date: Tuesday, May 27, 2025 11:38:29 PM
Attachments: City of San Mateo Electrification Review 05272025.pdf image003.png
Greetings Andrea,
See attached file for feedback/comments concerning numerous initiatives related to electrification of existing buildings.

It is a long read, so hopefully it is useful and should address most concerns for affected parties.

Let me know if it was useful to spend my time on.

Thanks, Alan
On Tuesday, May 13, 2025 at 02:00:11 PM PDT, Andrea Chow <[email protected]> wrote:

Reminder! Upcoming community meetings for Electrify San Mateo:

May 14: Sustainability and Infrastructure Commission
May 21: Community Relations Commission
We invite you to share your feedback and shape the Electrify San Mateo: Sustainable Building Strategy.

Community feedback will be shared with City Council tentatively scheduled for June 16, 2025. Please see the Public Meeting Portal for meeting agenda and information posted roughly one week before the Commission meetings.

Andrea
Andrea Chow
Sustainability Analyst
City Manager’s Office
330 W. 20th Ave., San Mateo, CA 94403
650-522-7007 | [email protected]
979 of 1111
From: Andrea Chow
Sent: Monday, April 28, 2025 2:14 PM
Subject: Electrify San Mateo: Three Upcoming Community Meetings Hello,
Switching from natural gas to carbon-free electric equipment in our homes and buildings is critical to reducing greenhouse gas (GHG) emissions in our community. Gas appliances release air pollutants and studies have shown that exposure to these pollutants pose significant health risks. In addition to advancing our climate goals, electrification eliminates these risks and can provide a safer and healthier environment. The Electrify San Mateo project team will present existing building electrification policy pathways at three upcoming City Commission meetings:

May 12: Senior Advisory Commission
May 14: Sustainability and Infrastructure Commission
May 21: Community Relations Commission
We invite you to share your feedback and shape the Electrify San Mateo: Sustainable Building Strategy.

Community feedback will be shared with City Council tentatively scheduled for June 2025. Please see the Public Meeting Portal for meeting agenda and information posted roughly one week before the Commission meetings.

Andrea
Andrea Chow
Sustainability Analyst
City Manager’s Office
330 W. 20th Ave., San Mateo, CA 94403
650-522-7007 | [email protected]
* PRIVILEGE AND CONFIDENTIALITY NOTICE: This message, together with any attachments, is intended only for the use of the individual or entity to which it is addressed. It may contain information that is confidential and prohibited from disclosure. If you are not the intended recipient, you are hereby notified that any dissemination or copying of this message or any attachment is strictly prohibited. If you have received this message in error, please notify the original sender immediately by telephone or by return email and delete this message along with any attachments from your computer. Thank you. 980 of 1111
1 Report Review:

Sustainable Buildings Strategy
Project Update - May Evaluation
Summary:

This review is provided in the form of a due diligence evaluation and consumer protection for adopting full electrification to existing structures in the City of San Mateo. There appears to be numerous deficiencies in information and consumer safeguards addressed. No indication that a particular initiative that meets or exceeds the BAAD initiatives will make a significant difference to the local micro-climate. The primary consumer concerns appear to be affordability, achievability, and alternatives. There is a factor of unintended consequences. The escalating electricity and gas rates in a monopoly business environment creates a paradox of energy conservation versus energy consumption. The expectation is whatever is determined will be voted upon as it affects existing structures/property, unavoidable impact to its owners, and consequences to its occupants; therefore, a highly convincing justification and well-devised plan of implementation is required. Overall, a mix of the options available may have the greatest success for maximum effectiveness under affordable conditions.

Review Objective:

To provide an objective recommendation for an electrification and climate change abatement policy that may have the greatest level of success for adoption. Progression to a goal is considered superior to complete abandonment.

Background Review:

This review is based upon the following information provided:
"Electrify San Mateo: Sustainable Building Strategy - Feedback, May 12, 2025" "Electrify San Mateo: Sustainable Building Strategy - Feedback, May 14, 2025" "Climate Action Plan - Annual Progress Report - May 14, 2025" "Electrify San Mateo: Community Relations - Feedback, May 21, 2025" There are established bans for the sale of new gas water heaters (2027) and new gas furnaces (2029) with near-term deadlines. If these near-term deadlines are maintained, this study may be an academic thought experiment too late for some affected parties. The most significant scenario example is a fixed income living condition that must replace a failed gas water heater in 2027 with insufficient amperage for an equivalent electric water heater. In this case, the lack of situational awareness and contingency planning for the impact of the ban is disturbing at the very least.

Project Overall Review:

There are five long-standing options to review in whole, in part, or in some combination:

1. Business as usual.

2. New reach codes for renovations.

3. Require electric equipment upon replacement ahead of BAAD Zero NOx requirements.

4. Building Performance Standards for commercial buildings.

5. Electric first policy for City facilities.
981 of 1111
2 Information/Knowledge Review:

The Rincon Consultants Inc. report is the most objective information available.

The community concerns were identified as (per page 3):

These are unquestionably valid concerns that need to be addressed: Upfront costs of electrical equipment may be mitigated with consideration for flexible policies to choose electrification or other cost-effective strategies. On-bill or operational costs may be mitigated by cooperation with Peninsula Clean Energy. Installation and electrical infrastructure implementation challenges may be mitigated by flexible compliance paths. Grid reliability and resilience is assuming and planning for a 27% increase in demand by 2035.

The May 14, 2025, "Electrify San Mateo: Existing Building Electrification Pathways Analysis, Policy Analysis (pages 7 through 23) was vague and had some logic inconsistencies, so it was informative to some extent for background purposes. However, there is an apparent difference of how a commercial building is treated compared to a residential property. The Phased approach for commercial buildings with much more consideration taken versus a residential structure that is faced with the gas ban deadlines is disturbingly different and obvious preferential treatment.

The May 14, 2025, "Summary of Community Engagement for Electrify San Mateo" was far more useful to review.

Affordability:

The following surveys were interesting, but may lead to wrong conclusions. There should be an awareness of the conditions "house poor" or "rent poor" that is not taken into account. 982 of 1111
3 What would be more useful is the disposable funds available, which would be free discretionary cash per month and discretionary reserve funds. The most troubling question is how large is the population in the City of San Mateo that can endure a significant financial impact aggravated by escalating energy costs, which have no foreseeable reason to significantly decline in part or in total due to the monopoly utility profit structure.

The following are some items have not been addressed to determine what costs may be directly or indirectly incurred and to prevent predatory pricing for some items:

1. Increased property tax and/or local tax to support city electrification improvements?

2. Increased utility rate charge for a higher amperage grid infrastructure to support the City?

3. Fixed or capped charge schedule for utility-provided services?

4. Fixed or capped charge schedule for City fees?

5. Fixed or capped charge schedule for electrical amperage service upgrades?

6. Are costs and rebates dependent upon the whims of the state government? Without all this information, it is very difficult to determine if there is sufficient information for property owners to make financially-sound decisions. The state legislative consideration of AB 942 for solar is a significant blow to trust in a state government agreement.

The highly volatile economic and product availability conditions that may persist for a number of years is a major factor in consideration as well as the sense of declining support nationally and the troubled state financial conditions. The current observation is a negative environment of uncertain employment, higher inflation, and unfavorable outlook for climate change support.

Achievability:

There are practical considerations that have not been clearly addressed. Some are vague and others have no sound explanation.

For grid reliability, complete dependence on electricity for life-supporting space heating, and heated water is highly suspect. An event similar to the February 2021 Great Texas Freeze must be avoided, especially for the at-risk population. No detailed study has been presented as to how the 27% electricity increase may be sufficient. It is logically hard to believe the two highest energy demand devices in a residence can be compensated by a 27% energy increase, especially during the winter months. If out-of-state and/or in-state gas-fired generators are used 983 of 1111
4 to supplement the 27%, then this makes sense, but does create a hypocritical compromise. Solar with a battery is less attractive due to the declining return on investment unless there is unreliable grid power, and is a financially presumptuous/arrogant comment. A low NOx gas water heater and low NOx gas space heating may be a more valid alternative for those resourceful to use a backup battery/portable power station during a grid power loss.

For supply issues, equipment, contractor, and city services availability are concerns. The cost and availability of electrical hardware may be uncertain to schedule work with the current trade turmoil. If a utility transformer is need for the higher amperage demand, this creates greater uncertainty. Contractor availability to meet a particular schedule is an uncertainty by experience.

Timely City and utility services are a further complication as it is highly uncertain if more support staff will be hired. Equipment to provide alternative electrical energy while grid electricity is disconnected may be problematic as well as the negative impact to the resident occupants.

Alternatives:

There are various alternatives of various effectiveness compared to full electrification with positive aspects. These are largely to favor renters to reduce incremental rent increases and the low/fixed income with restricted funding.

1. Low NOx gas water heater and gas space heater.

2. New or higher-effective insulation.

3. Higher efficiency windows.

4. Higher efficiency appliances.

5. High capacity air exhaust (gas and by-products when cooking).

There is an energy conservation versus energy consumption paradox in terms of energy rate escalation in a monopoly environment. Ironically, it may be better to consume more energy for the utility to gain greater revenue and achieve the desired profitability at the existing rate. Energy conservation may drive up rates to meet profitability targets. Therefore, with other factors beyond consideration, these may not necessarily keep energy rates at a reasonable/affordable level. In addition, what an affordable utility rate is has not been defined or even asked.

Community Feedback:

The following can be classified based upon some implied assumptions from the community feedback:

1. Implemented electrification due to available assets.

2. Implemented electrification with dissatisfaction concerns.

3. Concern for one-time and on-going costs.

4. Concern for increased rental/leasing costs to tenants.

There does not appear to be definitive information to address the concerns.

Unintended Consequences:

These are "what if" scenarios/conditions that should be in consideration to mitigate risk as a few examples of consequences.

For the property owner of an aging multi-family building, it may be more financially attractive to do a teardown and build a new structure under reach codes for renovations. For example, it may have more a more efficient electrical space heating design, more electrical outlets, better insulation, energy-efficient windows, soundproofing, improved security, lower maintenance, and much more onsite parking for overcrowded streets. Therefore, this would change the affordability of the residences and reduce the amount of available housing for an extended period of time, but much more attractive option for tenants.
984 of 1111
5 A developer/builder may avoid the City of San Mateo to repurpose an existing structure to meet a specified target market price, especially for affordable housing or affordable leased space for businesses under reach codes for renovations. It may be more profitable for the target market price to build to lesser codes elsewhere. Therefore, this may result in less affordable housing or business space.

There may be a question of trust in general due to the declining benefit of solar and the pending, solar contract-breaking AB 942. It now appears residential solar is a property owner-financed energy generating infrastructure expense and a solar battery that may be seen as a fire hazard.

An electrification-accelerating set of reach codes appears highly suspicious, especially if the Federal and/or State initiative goals may be relaxed due to economic or political conditions. The property owners may once again be spending funds under false expectations and those funds should have been held in reserve to pay for well-established, escalating energy costs in a monopoly environment. Therefore, a convincing commitment to the initiatives is required.

Recommended Policy:

The following is the recommend policy for the greatest level of success to achieve the various objectives based upon the information provided:

1. Electric first policy for City facilities: This must be done or this would be complete hypocrisy.

The expectation certain structures may be excluded for historical reasons. This would establish the base impact to the city electrical grid and any infrastructure costs resulting in utility rate and/or local tax increases. No further discussion is required.

2. Building Performance Standards for commercial buildings: There is a proposed, relaxed implementation phased plan. At-risk conditions must have back-up contingency system. A low interest rate loan for full electrical would be an added incentive. With the cost of the renovation being a depreciated expense and the low interest rate loan, these should be sufficient to have a high adoption rate. This should establish if there is an impact to the city electrical grid and any infrastructure costs resulting in utility rate and/or local tax increases.

3. Require electric equipment upon replacement ahead of BAAD Zero NOx requirements:

Completely invalid for consideration. There is insufficient information for a consumer to make an informed decision nor sufficient time to implement the requirement under certain conditions.

4. New reach codes for renovations: Full electrification-ready condition could be required for a property in a vacant condition (between property owners) or major renovations in a vacant condition. Full electrification conversion is at the discretion of the property owner, especially if there is no plan to change existing appliances. Full electrification should not significantly impact housing affordability for specific housing markets. Low interest loans for the full electrification expenses should suppress an escalating the cost increase and maintain affordability. The City would need to be monitor if the full electrification is used for the purpose of forced evictions. This should establish if there is an additional impact to the city electrical grid and any infrastructure costs resulting in utility rate and/or local tax increases.

5. Business as usual: Full electrification and BAAD Zero NOx requirements are waived/exempt for rental properties, fix income residents, and low income residents. This may assure no significant increase to rental rates or unnecessary hardship to the low or fixed income. The other listed alternative changes are at the discretion and encouraged for maximum benefit.

This is similar and equal allowances to the relaxed conditions allowed for commercial buildings.

Affected parties may still may face the collateral cost impact due to the accumulated impact from the other three policy conditions. Voluntarily adopting full electrification is highly encouraged as was for adopting solar.
985 of 1111
6 Conclusions:

There is a fundamental problem for a lack of information as to how the various degrees of mitigating actions affects the local micro-climate outcome. It is a cost versus benefit decision or, in this case for some, reducing the quality of life sacrifice for a indeterminate outcome. The actual versus perceived financial status of the population is problematic for expectations to implement initiatives. The magnitude of affordable housing needed should be a sanity check.

There appears to be a lack of a systemic/comprehensive reference for what changes may be necessary for full electrification and/or electrification-ready. A cost of electrification calculator with a menu of itemized estimated costs and estimated time-to-completion would be highly useful.

This should be useful for an informed decision and/or approval. The provided recommended policy is largely based upon current economic and policy conditions which are very volatile and may be prohibitive to do anything of significance. The outcomes of past City initiatives and the fluid federal/state/local policy conditions may influence acceptance.

The BAAD Zero NOx requirements ban for gas water heaters and gas furnaces appears impractical and a blow to initiative management creditability, and/or will create predictable collateral damage. The gas devices can provide stand-by, systemic redundancy as a contingency.

The full electrification has good intentions, but there is a lack of information as well as contingency planning that may endanger the safety of a portion of the population. Predictably, failure to maintain benefits of adoption for a mitigating action will have negative consequences for any initiatives in the future or sustaining the existing ones.

Alan Ouye
May 27, 2025
986 of 1111
From: Jennifer Mora
To: Andrea Chow
Subject: Fw: Electrify San Mateo: I support all five decarbonization options Date: Monday, May 12, 2025 6:42:48 AM
FYI
From: Emily Morris < >
Sent: Sunday, May 11, 2025 5:00 PM
To: Emily Morris < >
Subject: Electrify San Mateo: I support all five decarbonization options Hello,
I'm a resident of North Central San Mateo, and I am writing in strong support of all five decarbonization options as part of the Electrify San Mateo project. I believe it is critical we reduce greenhouse emissions so we can enjoy a livable, breathable San Mateo for many years to come. Thank you for your time and consideration.

Thank you,
Emily Morris
987 of 1111
From: Pam Rittelmeyer
To: Sustainability & Infrastructure Commission
Subject: May 14 SIC meeting agenda: support new business item 1 Date: Wednesday, May 14, 2025 10:33:59 AM
Dear San Mateo Sustainability and Infrastructure Commissioners, I am writing as a resident of San Mateo and President of Borel Neighborhood Association to urge you to take action to reduce our community's greenhouse gas emissions by supporting the decarbonization objectives being considered tonight as item 1 under New Business.

We are in a race to limit impacts from climate change. We have the energy efficient technology, the technical assistance programs, and a growing workforce to act now. The objectives in this agenda item are flexible and sensible. By committing to a clean energy future for our buildings, San Mateo can demonstrate leadership on climate action, create healthier living environments, and ensure a just transition for all residents.

Thank you for your attention to this critical issue and for your ongoing work to build a more sustainable and resilient city.

Sincerely,
Pamela Rittelmeyer, PhD
President, Borel Neighborhood Association
Sent from Gmail Mobile
988 of 1111
From: Robert Whitehair
To: Sustainability & Infrastructure Commission
Cc: Andrea Chow; Michelle Hudson
Subject: May 14, 2025 SIC Meeting - Item 1 Under New Business Date: Wednesday, May 14, 2025 5:24:09 AM
Dear Chair Narita, Vice Chair Michael, and Andrea Chow
We thank you for the opportunity to provide this letter of support, and for your continued climate leadership. As you know, the Intergovernmental Panel on Climate Change has determined that if we continue to emit greenhouse gas emissions at the current rate, climate change will become irreversible in five years. The time to take strong climate action is now, and, in light of the federal government’s inaction on climate, it’s more important than ever that cities like San Mateo demonstrate strong climate leadership.

Item 1 under New Business on the May 14 agenda will go a long way towards implementation of the following City Council objective which has already received strong SIC backing:
“Establish policies to decarbonize existing buildings and infrastructure, and eliminate methane gas use by 2030.”
We respectfully request that the SIC support all five objectives of the Sustainable Building Strategy:

Keep in place the very successful reach codes for new construction Extend reach codes to retrofits of existing buildings
Support accelerated elimination of Nitrous Oxides, specifically the Air District requirements to replace failed gas water heaters and gas furnaces Build upon an established program of building performance standards Support electrification of City buildings
We want to take this opportunity to emphasize all that has been done already:

Significant City support for decarbonization – The City of San Mateo hired a consultant and provided valuable City staff time, to prepare a decarbonization study for adoption over the next few months
989 of 1111
Even More City support for decarbonization – The City of San Mateo has created a valuable website: “Electrify San Mateo”
Concierge service for Electrification – Peninsula Clean Energy has created a “Concierge Service” for electric vehicles and electric home upgrades, available to everyone
Equity for renters – San Mateo community-based organizations are directly involved in helping renters within the City of San Mateo More Equity for renters – PCE has active rebate programs focused on renters.

Equity for homeowners – Free electric appliances are now provided by PCE for income qualified homeowners
Clean energy at rates lower than PG&E – Peninsula Clean Energy has provided $22.8 million in savings for residents and businesses within the City of San Mateo
Reduced GHG – San Mateo residents and businesses have signed on to electricity from PCE, which has reduced emissions from electricity by 98% in just 10 years.

Significant rebates are available to all for EVs, EBikes, water heaters, heating/cooling and other components.

Many local community-based organizations are aligned in this important effort. For example, we have learned that along with San Mateo Climate Action Team and 350 Silicon Valley, so many other organizations are working towards successful implementation of sustainable building strategies: One San Mateo, El Concilio, Climate Resilient Communities, Sustainable San Mateo County, Indivisible San Mateo, Peninsula Interfaith Climate Action, Sierra Club, Citizens Climate Lobby, and Physicians for Social Responsibility, just to name a few.

Many thanks for all you are doing.

Michelle Hudson and Robert Whitehair, Co Leaders
San Mateo Climate Action Team and 350 Silicon Valley San Mateo City Team 990 of 1111
From: Ricki McGlashan
To: Senior Commission Mailbox; Sustainability & Infrastructure Commission; City Council (San Mateo); Community Relations Commission
Subject: Electrify San Mateo
Date: Monday, May 12, 2025 5:16:55 PM
I totally support any measures our city can take to encourage or require all electric houses. We shut off our gas line 18 months ago and have been so pleased. San Mateo has become notable in my mind for being at the forefront of issues that can make our lives better in the long run. This is a huge area where you can get in front and stay in front of the pack.

Ricki and Doug McGlashan
San Mateo
991 of 1111
From: Gary Trott 2
To: Senior Commission Mailbox; Sustainability & Infrastructure Commission; Community Relations Commission; City Council (San Mateo)
Cc: "Gary Trott"
Subject: Decarbonization Study - public input
Date: Sunday, May 11, 2025 9:58:28 PM
Dear San Mateo City commissioners and boards
Re: Decarbonization Study agenda item
Across the next days, all of you will be hearing from the Electrify San Mateo project team about the findings from the Decarbonization Study. Unfortunately, I am not able to attend the commission meetings. Nevertheless, I strongly support all five of the decarbonization proposals contained within the decarbonization report. The five options under consideration are shown below.

As a home owner, and resident of San Mateo City, I am three quarters the way through the process of electrifying my whole home. I am changing the appliance energy source from natural gas to all electric versions. I am doing this across a span of four years to maximize the federal tax credits. So I know in-depth about all of the implementation challenges. Including specific details associated with my house, and listening to home owners at various climate related events about their experiences.

There are many points of contention. People make poor choices. Contractors try to maximize their revenue instead of helping their clients. And the rebate application processes are adding burdensome overhead in Time-Of-Use reporting requirements. Only by providing information resources, and best practices, to be shared with citizens can the best implementations with a reduction in non-traditional, installation problems be achieved.

Time is of the essence to begin implementation of the methods described in the report. Day -- by – Day we collectively are putting more and more greenhouse gases into the atmosphere. The climate disasters that scroll across our TV screens from stronger hurricanes, stronger tornadoes, large temperature swings, wildfires and more will continue to worsen across the next decades. Acting today, by taking positive steps to reduce San Mateo City greenhouse gas emissions, will be a positive step towards reducing the future climate hazards, rebuilding costs, and the health and safety of all San Mateo residents. Act now to get the electrification converstion process started as soon as possible.

Regards
Dr. Gary Trott
Homeowner
1 Business as usual: City should continue with adopting reach codes for new construction and focus on outreach
and incentives.

2. Reach codes for renovations: This approach would include the evaluation of additional reach codes to
encourage and/or require electrification during renovations. 992 of 1111

3. Require electric equipment upon replacement ahead of BAAD Zero NOx requirements:

4. Building Performance Standards for commercial buildings: This pathway would establish a new set of policy
standards for commercial buildings aimed at increasing energy efficiency, and eventually, electrifying commercial buildings as a phased approach.

5. Electric first policy for City facilities: This policy establishes a mechanism for local government renovations to
go electric first.
993 of 1111
From: t3e lolz
To: Sustainability & Infrastructure Commission
Subject: comments on Electrification and PG&E
Date: Friday, May 9, 2025 6:21:26 PM
If we are to electrify San Mateo, then we first need to get our electricity rates down. PG&E's electricity rates keep going up and up, while the rates for natural gas are relatively stable.

Until either PG&E suffers some accountability or San Mateo starts it's own utility (similar to Santa Clara and Alameda) then it makes no financial sense to electrify our homes. Please do not force electrification upon us until you get our electricity rates under control.

Thanks,
Garrett
994 of 1111
From: Connie Schram
To: Andrea Chow
Subject: Gas stove
Date: Tuesday, May 13, 2025 4:04:10 PM
Dear Andrea Chow, I really enjoy cooking with my gas stove. Where do you plan to get all this electricity? And how will the electricity be generated? I have lived in homes with electric stove tops and I hate them. How do you expect me to pay for converting a furnace, clothes dryer, water heater, oven and stove top in my home? And then pay for that electricity!
Sent from my iPad
995 of 1111
From: Maureen Galindo
To: Andrea Chow
Subject: Electrify San Mateo
Date: Tuesday, May 13, 2025 3:20:08 PM
Dear Andrea,
In response to your email regarding switching from gas to electric equipment, I am not in favor of this action. When I have incurred the loss of power at my home (which has been happening more frequently) I am happy to have a gas stove in order to prepare breakfast/dinner. We also have a restaurant business and the ability to prepare orders on an electric appliance on a busy night would be next to impossible.

I believe the city should provide the pros and cons of switching over to electric appliances, then let the people decide whether to move in that direction. Forcing the people to switch to electricity is not in the best interests of the citizenry of San Mateo.

Regards,
Maureen Galindo
996 of 1111
From:

To: Andrea Chow
Subject: Re: Reminder: Electrify San Mateo: Upcoming Community Meetings Date: Tuesday, May 13, 2025 2:10:42 PM
Attachments: image003.png
Hi Andrea,
Thank you for the reminder. Unfortunately, I will not be able to attend the meeting. I would like to provide a comment. The City currently has a $5 million deficit. Next year the deficit balloons to $15 million. In light of this dire situation, I think the city should look carefully at all line-item expenditures. Climate resiliency is one area where the city could postpone expenditures. At 0.10 to 0.12 inches sea level rise per year, we have some time. Let's postpone significant expenditures for at least 2 years.

Thank you,
Laurie Hietter
On Tue, May 13, 2025 at 2:00 PM Andrea Chow
<[email protected]> wrote:

Reminder! Upcoming community meetings for Electrify San Mateo:

May 14: Sustainability and Infrastructure Commission
May 21: Community Relations Commission
We invite you to share your feedback and shape the Electrify San Mateo: Sustainable Building Strategy. Community feedback will be shared with City Council tentatively scheduled for June 16, 2025. Please see the Public Meeting Portal for meeting agenda and information posted roughly one week before the Commission meetings.

Andrea
Andrea Chow
Sustainability Analyst
City Manager’s Office
330 W. 20th Ave., San Mateo, CA 94403
650-522-7007 | [email protected]
997 of 1111
From: Andrea Chow
Sent: Monday, April 28, 2025 2:14 PM
Subject: Electrify San Mateo: Three Upcoming Community Meetings Hello,
Switching from natural gas to carbon-free electric equipment in our homes and buildings is critical to reducing greenhouse gas (GHG) emissions in our community. Gas appliances release air pollutants and studies have shown that exposure to these pollutants pose significant health risks. In addition to advancing our climate goals, electrification eliminates these risks and can provide a safer and healthier environment. The Electrify San Mateo project team will present existing building electrification policy pathways at three upcoming City Commission meetings:

May 12: Senior Advisory Commission
May 14: Sustainability and Infrastructure Commission
May 21: Community Relations Commission
We invite you to share your feedback and shape the Electrify San Mateo: Sustainable Building Strategy. Community feedback will be shared with City Council tentatively scheduled for June 2025. Please see the Public Meeting Portal for meeting agenda and information posted roughly one week before the Commission meetings.

Andrea
Andrea Chow
Sustainability Analyst
City Manager’s Office
330 W. 20th Ave., San Mateo, CA 94403
998 of 1111
650-522-7007 | [email protected]
* PRIVILEGE AND CONFIDENTIALITY NOTICE: This message, together with any attachments, is intended only for the use of the individual or entity to which it is addressed.

It may contain information that is confidential and prohibited from disclosure. If you are not the intended recipient, you are hereby notified that any dissemination or copying of this message or any attachment is strictly prohibited. If you have received this message in error, please notify the original sender immediately by telephone or by return e-mail and delete this message along with any attachments from your computer. Thank you. --
Laurie
999 of 1111
From: wendy woodard
To: Andrea Chow
Subject: Electric Conversion
Date: Wednesday, March 5, 2025 10:16:04 AM
I am not in favor of moving up a deadline that surpasses state law and the Bay Area Air Quality Management District.

Wendy Woodard
1000 of 1111
From: Dino Martins
To: Andrea Chow; City Council (San Mateo); [email protected]; Clerk Subject: Electrify San Mateo - , San Mateo
Date: Monday, April 28, 2025 2:40:17 PM
Hello Andrea,
I just received your email pertaining to the upcoming meetings/discussions regarding the "Electrify San Mateo" initiative.

Unfortunately I am going out of town in May during the dates that you listed when the public discussions are taking place.

I just went through the process of getting my service upgraded to accommodate some enhancements that we made to the property and to be prepared for the upcoming requirement of switching over from natural gas to electricity. The process was a disaster and took almost one year to get completed. While the main issues were with PG&E the City of San Mateo also contributed to the delays.

There is WAY TOO MUCH RED TAPE in the current process. In our case this lead to costly delays and much frustration to my wife and I.

I would be happy to share my thoughts with you, should you or someone else want to reach out to discuss in detail.

I hope to hear back from someone.

My mobile number is: .

Warm regards,
Gualdino "Dino" Martins
, San Mateo, CA 94402
1001 of 1111
From: Ines Malardino
To: Alex Khojikian; Andrea Chow
Subject: No on decarbonization pls
Date: Wednesday, March 5, 2025 12:01:08 PM
Hello…
The proposed plan to begin the decarbonization of existing homes, commercial, and retail buildings
is so unacceptable for so many reasons. Please do not assist on this? Ines Malardino
1002 of 1111
From: William Williams
To: Andrea Chow
Subject: Electrification
Date: Friday, February 21, 2025 10:55:25 AM
Please take into consideration the cost of modifying small existing structures.

The power grid does not have sufficient capacity to provide for "all-electric." Higher electric rates add a forever escalating cost on top of modification costs.

The best solution is to have everyone consume less energy instead of increasing electricity demand.

X Bill Williams, San Mateo
Sent from Outlook
1003 of 1111
1004 of 1111
Rincon Consultants, Inc.
66 Franklin Street, Suite 300
Oakland, California 94607
510-834-4455
w w w . r i n c o n c o n su l t a nt s . c o m
June 16, 2025
Andrea Chow, Sustainability Analyst
City of San Mateo
330 West 20th Avenue
San Mateo, California 94403
Via email: [email protected]
Subject: Electrify San Mateo: Existing Building Electrification Policy Pathways Analysis In the City of San Mateo (City), the residential and commercial built environment make up 38 percent of greenhouse gas (GHG) emissions. To achieve emissions reduction targets consistent with state goals and the City’s Climate Action Plan, the City must decarbonize its residential and commercial buildings. This is strengthened by the 2022 City Council priority to “Establish policies to decarbonize existing buildings and infrastructure and eliminate methane gas use by 2030.” The decarbonization or electrification of buildings refers to the transition from gas equipment to carbon-free electric equipment for space and water heating, clothes drying, cooking and more. Decarbonization can also focus on increasing energy efficiency and the use of renewable energy. In San Mateo, Peninsula Clean Energy (PCE) provides electricity that is 50% renewable and virtually 100% carbon free and is committed to delivering 100% renewable and carbon free electricity by 2025. The City has already passed a New Construction Reach Code aimed at decarbonizing new buildings, however, electrifying existing buildings offers the largest opportunity and most cost-effective strategy for GHG emission reductions.

In May 2023, the City, with the help of Rincon Consultants Inc. (Rincon), began developing the Building for the Future: City of San Mateo Sustainable Buildings Strategy project as a part of the larger Electrify San Mateo initiative. The goal of this project is to develop a long-term strategy document to electrify San Mateo’s existing building stock, including policies and actions for both residential and nonresidential buildings. This report provides Rincon’s final policy findings which are based on the cumulative technical analysis and community feedback completed to date.

Project Timeline and Overview
The City of San Mateo and Rincon began the initial research for this project in the Summer of 2023. The initial analysis included building segmentation analysis and an electrification cost study. Rincon also conducted research on the current best practices and a wide range of feasible policy options being deployed by other cities around the country. The project timeline is shown below in Figure 1. 1005 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
2 Figure 1 Project Timeline to Date
Community Outreach (Phase I)
During the first phase of community outreach, the City aimed to understand the goals and concerns of the community as they relate to San Mateo’s buildings and decarbonization. Through the initial round of engagement, the City identified affordability, health and safety, resilience, and climate as the primary goals of the community. The largest concerns related to building electrification were the potential for higher costs, increased energy bills, and a difficult installation process. Based on this feedback and direction from City Council, the initial policy scan list was narrowed down to five potential policy directions.

Policy Pathways
The results from the Phase 1 of outreach helped narrow the initial policy scan into a list of five policy pathways, which were presented to City Council in January of 2024. These policies were chosen based on the GHG reductions potential as well as cost-effectiveness. The five policy pathways include

1. Continue adopted reach codes and focus on outreach and incentives (Business as Usual)

2. Explore and adopt new reach codes to encourage and require electrification

3. Require electric equipment upon replacement ahead of the Bay Area Air District’s (BAAD)1 Zero NOx requirements

4. Establish Building Performance Standards for commercial buildings

5. Adopt an electric-first policy for City facilities
1 The Bay Area Air Quality Management District (BAAQMD) changed their name to the Bay Area Air District (BAAD) in 2025. 1006 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
3 City Council provided feedback which included direction for City staff to continue exploring the feasibility, cost, and community support for each of the five options.

Community Outreach (Phase II)
In the second phase of community outreach (see Engagement Summary Memo for detailed results), the City aimed to get specific feedback about the five policy pathways. Phase II outreach events included both in-person and virtual workshops, presentations to the Senior Advisory Commission, Sustainability and Infrastructure Commission, and Community Relations Commission, as well as a second online feedback survey. Feedback received from Phase II of outreach is incorporated into an analysis of each policy pathway in the following sections.

Addressing Community Concerns
Throughout the community engagement process, there have been polarized responses to building electrification. While most constituents care about addressing the Climate Crisis and agree that the City should pursue existing building electrification in some form, many residents also expressed concerns. The primary concerns identified during Phase I and Phase II engagement included:
• Upfront costs of electric equipment
• On-bill or operational costs of electric equipment
• Installation and electrical infrastructure challenges • Grid reliability and resilience
• Lack of education surrounding electrification (addressed in Policy Option 1) Each of the pathways balance the City’s climate goals and the roughly half of respondents who strongly support building electrification with the concerns voiced during the engagement process in different ways.

Each primary community concern is addressed below and further covered in the policy summaries.

Upfront Costs of Electrical Equipment
For many building owners, making the switch from natural gas to electric appliances results in higher upfront costs without additional incentives or rebates. While rebates can cover up to 100% of these costs, rebates are not always available. However, not installing electric equipment when it is most cost effective can have significant cost impacts in the future. Therefore, the City has identified flexible policies that allow building owners to choose electrification or other cost-effective strategies. Each policy below provides additional details of the upfront costs and savings.

On-Bill or Operational Costs
Ongoing operational costs (how much our monthly energy bills are) were another concern regarding building electrification. However, recent studies by Peninsula Clean Energy show that the cost savings from building electrification are increasing as natural gas rate increases outpace electricity rates. Average savings (when using electric rates like e-elec) were $29 per household per month after electrifying both water and space heaters. These savings are demonstrated in Figure 3. 1007 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
4 Figure 2 Average Monthly Bill Savings from Electrification Installation and Electrical Infrastructure Challenges
While most electric appliance upgrades are relatively simple, some buildings present difficult edge cases.

Some buildings may not have sufficient space or electrical infrastructure to easily upgrade. Upgrading electric panels and service lines can take months to complete. While all-building owners are encouraged to make a plan for electrification over time, many of the policies avoid these challenges by providing flexible paths to compliance or focusing on specific appliances which do not have these challenges. For example, the flex-path retrofit policy provides many options including insulation and other cost-effective efficiency upgrades at the time of major renovation. The AC to heat pump policy avoids these challenges because the heat pump upgrade uses the same electrical circuit as an AC, eliminating the need for upgrades. Grid Reliability and Resilience
Grid Reliability and Resilience
Grid reliability and resilience concerns arose due to the perception that increased electrical use would put strain on the grid and that electricity was less reliable than gas. However, it has been nearly 20 years since 1008 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
5 California had a power outage due to lack of electricity.3 Furthermore, the utilities, the CPUC, and the CEC, are all planning for increased electricity usage over time. The CEC now assumes a 27% increase in peak demand by 2035 due to electrification of buildings and vehicles and is expanding the grid to meet that demand. Furthermore, neither gas water heaters nor most furnaces work without electricity, meaning gas appliances are no more resilient to power outages than their electric upgrades. Therefore, the policies identified below focus on these appliances.

Policy Findings Summary
To analyze the feasibility and benefits of each policy pathway, Rincon provided a description of each pathway, pro’s and con’s, precedent legislation in other cities and the state, GHG reductions potential, community feedback, cost-effectiveness, and equity considerations. Based on the detailed analysis in the Policy Analysis section, the following summary highlights the major takeaways of the five policy pathways.

1. Business as usual: The City could continue with adopting reach codes for new construction and expand outreach, education, and incentives. In the past, the City adopted local building code amendments to require more sustainable new construction than the State code. To continue to surpass State code, the City could consider other new construction reach codes including an energy performance or Zero NOx reach code. This approach has a limited impact because new construction accounts for a fraction of San Mateo’s development. However, this approach is already in place, cost saving up front and over time, and received community support based on our engagement efforts. There are no policy-related additional costs to building owners unless they voluntarily decide to electrify. A Zero NOx new construction approach would save an estimated 1,770 MT CO2e per year by 2030 while a performance approach would save 20 MT CO2e per year by 2030.

2. Reach codes for renovations: This approach would include the evaluation of additional reach codes to encourage and/or require electrification during renovations or at time of replacement for select appliances (air conditioners). New reach codes would vary depending on the updated State codes.

One example of a reach code during renovations is requiring the installation of a two-way heat pump when an air conditioner (AC) is installed. A Two-way AC time of replacement reach code could help residents save money by installing a single heat pump, rather than an AC and furnace, ahead of upcoming Bay Area Air District (BAAD) regulation which essentially mandates electric furnaces starting in 2029. The incremental cost of installing a heat pump instead of a traditional AC is the same (from $1,000 savings to $1,000 cost) and is covered by a $1,500 PCE rebate. Installing a heat pump today is alignment with future Air District regulations and thus could also save a building owner money when their furnace needs replacement. Reach codes during renovations also help encourage electrification at an opportune time when a property owner is already considering home improvements. Another policy example is a Flex Path reach code which would require additional energy efficiency or electrification actions at time of renovation or replacement of certain appliances. The upfront costs of electrification improvements can vary depending on the project and unique circumstances of your home. These policies target the most cost-effective time to electrify and provide a variety of pathways for compliance. Cost-effectiveness studies must be completed to validate any adopted reach codes.

Past studies have shown utility savings over time make electric equipment upgrades cost-effective compared to gas equipment replacements. Additionally, the Flex Path reach code allows residents to 3 https://www.baaqmd.gov/~/media/files/community-health/building-appliance-implementation/grid-impacts-finalpdf.pdf?rev=14a3ea4d46704d19a48cf03e3984c90e&sc_lang=en 1009 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
6 find the most cost-effective retrofit for their unique situation. Two-Way AC reach code would reduce emissions by 2,200 MT CO2e per year by 2030, while the Flex Path reach code would reduce emissions by approximately 730 MT CO2e per year by 2030.

3. Require electric equipment upon replacement ahead of BAAD Zero NOx requirements: BAAD adopted zero nitrogen oxides (NOx) standards that will prohibit the sale and installation of gas water heaters starting in 2027 and gas furnaces in 2029 in the nine-county Bay Area. A local ordinance ahead of these milestones would require the replacement of gas appliances with zero NOx versions when they fail or are voluntarily upgraded. This policy would have the most significant impact on greenhouse gas reductions with the ability to reduce emissions an average of 9,700 MT CO2e per year by 2030.

However, this policy could incur large installation costs for residents in some cases which was the number one concern documented during both phases of community engagement. Due to the polarized community feedback, with some constituents being unsupportive of mandates that increase costs, it may be difficult to garner public buy in for a Zero NOx Equipment Requirement policy. This policy prioritizes GHG emissions reductions but does not address the community’s major concerns over costs and difficult installations.

4. Building Performance Standards for commercial buildings: This pathway would establish a new set of policy standards for commercial buildings aimed at increasing energy efficiency, and eventually, electrifying commercial buildings as a phased approach. This is a well-established policy mechanism that has been adopted by many local governments across the country and builds off of AB 802 benchmarking requirements mandated by the state for buildings larger than 50,000 SF. This approach can be customizable and lead to incremental reductions in energy use but not necessarily electrification. The flexibility of this policy and phased approach allows for building owners to plan for appliance replacement and decarbonize buildings in the most efficient way for each unique situation.

Commercial building space makes up over 39 million square feet within the City and is a significant contributor to GHG emissions. However, due to the phased approach, this policy would likely not lead to significant GHG reductions before 2030. However, it could have significant reductions before 2045 as the thresholds are calculated and implemented. The development and operation of such a local program would necessitate significant staff time, so choosing a threshold that maximizes square footage covered while minimizing the number of building owners affected is crucial. Although this policy received majority community support, equity for renters is also a significant concern and guardrails would need to be set in place to avoid exacerbating the housing crisis especially for multifamily properties.

5. Electric first policy for City facilities: This policy establishes a mechanism for local government renovations to go electric first. The policy ensures financial and feasibility data is being collected for municipal facilities that will allow the City to compare costs to electrify versus replacing with gas equipment. This policy has a limited reach as it only applies to municipal buildings and GHG reductions potential would depend on the rate of equipment failure and availability of replacements. However, it demonstrates City leadership on hard-to-electrify existing buildings that mirror the commercial sector. Several other cities have adopted similar municipal electrification policies. Residents were largely in favor of this policy as it would not incur any costs to the community. The City’s municipal buildings are estimated to generate approximately 586 MT CO2e per year of natural gas emissions, this policy was estimated to be able to reduce this by 25% by 2030 for an estimated savings of 146 MT CO2e.
1010 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
7 Policy Analysis
Policy Option 1: Continue adopted reach codes and focus on outreach and incentives (Business as Usual)
Description
Policy Option 1 continues to implement the City’s adopted reach codes and identifies opportunities to incentivize the electrification process using education, outreach, and connecting the community to rebates and technical support. The City’s adopted reach code requires energy compliance margins for new buildings will be effective through December 31, 2025, the end of the code cycle. As part of this policy option, the City would investigate options around continuing the new building electrification reach code through either an updated performance standard which complies with the 2025 building code, or a zero NOx standard for new buildings.

This option would also use staff time to conduct additional engagement and connect homeowners to incentives and technical information regarding building electrification. It would also promote existing programming and incentives run by partners (e.g. PCE) to assist in a voluntary shift towards electrification while preparing the community to electrify space and water heating end uses in advance of upcoming BAAD (previously BAAQMD) Zero NOx requirements. For example, this option could include an education campaign to encourage homeowners to prewire for water heaters and furnaces, so they are ready to make the switch once their appliance burns out. Another example incentive would be waiving permit costs for electric equipment upgrades.

Policy Pros
• Policy already in place/ has received community support • No policy-related additional costs to building owners unless they voluntarily opt-in • Allows community to prepare for upcoming BAAD requirements through City-led outreach and education
• Allows community to prepare for upcoming requirements through electric-readiness requirements Policy Cons
• Limited impact and reach: The adopted reach codes do not affect the existing building stock • Relies on engagement to reach community members which can be difficult • Outreach and education programs on their own are extremely variable in their effectiveness.

Investment of staff time and city resources into outreach may not achieve substantial shifts in behavior that will be required to decarbonize buildings, even with major outreach campaigns. • Education and outreach campaigns can be very time/resource intensive with minimal programmatic results and unlikely to result in widespread behavior changes above baseline Greenhouse Gas Reductions Potential
New construction reach codes have varying GHG reduction potential. For example, a new construction zero NOx requirement could save up to 1,770 MT CO2e per year by 2030 if all new buildings were built 1011 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
8 without natural gas. An energy performance reach code for new construction would lead to approximately 20 MT CO2e GHG reductions due to the stringency of the 2025 building code, however, precise reductions potential is unknown because the flexible nature of the pathway does not always guarantee electrification.

As mentioned above, education and outreach and sharing incentives with residents is an important tool for the successful implementation of electrification policy but are not substantial enough to gauge GHG emissions on their own. It is difficult to predict what impact these voluntary programs would have on overall electrification rates, however, they are expected to be lower than the policy requirements identified in the other policy pathways.

Community Feedback
Across engagement events, this approach received broad community support. In the community survey, responses were 50% of respondents supporting this policy option, 11% neutral, and 38% do not support.

At the in-person community event, many community members expressed that the City has not done enough in terms of electrification policy beyond new construction and that a “business as usual” approach is not sufficient to meet the City’s climate goals. Those opposed to this approach are opposed to any local building electrification policy and recommend reliance on regional and state regulations. The Senior Advisory Commission, Sustainability and Infrastructure Commission, and Community Relations Commission were supportive of this policy pathway.

Cost Effectiveness and Equity Considerations
This policy approach would continue to incentivize all-electric new construction and direct the City to expand outreach efforts with the community to increase voluntary existing building electrification. New Construction reach codes have been shown to save money. Research from the New Buildings Institute (NBI) highlights that all-electric homes save between $7,500 and $8,200 in construction costs compared to mixed-fuel homes.5 These cost savings are primarily due to avoiding installing fees for natural gas infrastructure like gas meters and pipelines. These homes also save money over time especially when paired with heat pumps and solar. Outreach, education, and sharing incentives incur no cost to community members and can help connect people to resources that will lessen costs for electrification. The City will need to provide adequate staff time to support building electrification engagement and other programs like peer-to-peer home tours for this approach to be effective. These engagement activities, when paired with other strategies listed below, can help the community feel more comfortable and informed on the benefits of electrification.

Policy Findings
The adoption of reach codes while expanding education, outreach, and incentives to promote building electrification have been critical pathways for the City of San Mateo to support decarbonization to date.

This approach is supportive of the other policy options because expanding education and engagement can potentially increase the number of cost-effective voluntary projects and expand community understanding of new technologies and regulations (like the upcoming Air District’s Zero NOx rules). The community expressed the need education campaigns like helping to facilitate peer-to-peer home tours 5 NBI. 2022. New Study on Electrification Costs Shows Benefits to Building Owners and Society. https://newbuildings.org/new-study-onelectrification-costs-shows-benefits-to-building-owners-and-society/ 1012 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
9 and partnering with larger County initiatives like PCE’s helpdesk to ensure residents are receiving the guidance they need on their electrification journey. While this policy offers several benefits, it is important to acknowledge that this approach alone will not be sufficient to meet the City's climate goals. .

Policy Option 2: Reach Codes for Renovations
Description
Option 2 would include the evaluation of additional reach codes to encourage and/or require electrification. Reach codes are typically evaluated on a three-year cycle in alignment with the new Building Code. New reach codes options would vary depending on the updated Energy Code and Green Building Code. The City’s adopted reach codes apply to residential remodels. The City could consider a variety of reach codes that apply to different building types and/or equipment. The City focused on two priority existing building reach codes include a Two-Way Air Conditioning (AC) reach code or a Flexible Path reach code. These policies could be adopted individually or both adopted to complement each other.

Other reach codes which were not covered with the community but may be important in the future are time of sale requirements similar to the policy adopted by the City of Berkeley.7 Policy Option 2a: Two-Way Air Conditioning Reach Code
The Two-Way AC reach code would require all new air conditioning units to provide both heating and cooling through the installation of a two-way heat pump. A two-way heat pump is a versatile HVAC system that can both heat and cool a building by reversing the flow of refrigerant within the system. In heating mode, it extracts heat from an external source, such as outdoor air or the ground, and transfers it indoors.

In cooling mode, it reverses the process, removing heat from inside the building and releasing it outside.

This dual functionality eliminates the need for separate heating and cooling systems which can save building owners money in the long term. Two-way heat pumps run completely off electricity and heat and cool spaces with high efficiency, making them a great way to reduce emissions coming from homes.

Policy Option 2b: Flex Path Reach Code
Under the flex path policies, the City could adopt one or more policies that require additional energy efficiency or electrification actions at time of renovation or replacement of certain appliances. One example would be an energy efficiency checklist in which renovation projects over $75,000 must include two cost effective energy efficient improvements in their project. The flex path policies do not ban gas and provide flexible pathways for building owners to meet the decarbonization requirements.

Policy Pros:
• The City has experience exploring, adopting and implementing reach codes • Two-Way AC is a cost-efficient and simple solution
• Flex path offers variety of compliance pathways to reduce emissions and building owners could find the most cost-efficient pathways for their homes
7 https://berkeleyca.gov/sites/default/files/documents/2025-04-15-Amendments-to-the-BESO.pdf 1013 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
10 Policy Cons:
• Community and builder resistance to new regulations.
• Further analysis needed, dependent on reach code adopted.

Other Cities and Legislative Drivers
In May 2023, the Bay Area Air Quality Management District, now the Bay Area Air District (BAAD) adopted zero nitrogen oxides (NOx) standards that will prohibit the sale of gas water heaters starting in 2027 and gas furnaces in 2029 in the nine-county Bay Area. These standards are the most ambitious in the country and outpace the state’s goal of banning the sale of new gas furnaces and water heaters throughout the state starting in 2030. These policy efforts drive California closer to the ambitious climate goal of carbon neutrality by 2045. Reach codes during renovations present an opportunity to ensure that the City’s residential building stock is prepared for this upcoming mandate.

Two-Way AC policies are relatively new, so no jurisdiction has yet to officially adopt this reach code, but many are expected to in the 2025 building cycle. The “Flex Path” reach code style is more common with several jurisdictions who have adopted this policy listed below:
• City of San Rafael (Adopted 2024): San Rafael has adopted a "Flex Path" for single family remodels over 500 square feet. This policy requires homeowners to choose from a menu of energy-saving measures, such as insulation upgrades, HVAC improvements, or solar installations, to meet a target score based on their home's vintage. The program is designed to encourage energy efficiency and electrification while allowing homeowners to select measures that best suit their needs and budget. • City of San Luis Obispo (Adopted 2024): Starting January 1, 2025, single family major additions or alterations must install a set of energy efficiency measures to achieve a target score from a weighted menu of measures. Projects that include a new electrical panel and service upgrade to 200A shall include electric readiness components.
• Town of Corte Madera (Adopted 2024): Single family additions or alterations greater than 750 square feet of floor area shall install a set of measures to achieve a target score from a weighted menu of measures; which varies based on building vintage. Projects that include a laundry room or kitchen remodel, or an electrical service panel upgrade, must also install electric readiness measures.

Greenhouse Gas Reductions Potential
The Two-Way AC reach code would reduce emissions by 2,200 MT CO2e per year by 2030. Two-way heat pumps tend to be two to four times more efficient than both one-way air conditioners and traditional heating sources, leading to large potential GHG reductions.9 While the Flex Path reach code would reduce emissions by approximately 730 MT CO2e per year by 2030. The Flex Path reductions are lower since they only capture remodels over a certain size which occur at a lower rate than other appliance replacements.

Community Feedback
Across community engagement events, constituents were supportive of this policy approach. Community members recognized the importance of electrifying during planned renovation projects. In the community 9 Canary Media. A new bill could speed up American electrification by 20 years. https://www.canarymedia.com/articles/heat-pumps/a-new-billcould-speed-up-american-electrification-by-20-years 1014 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
11 survey, responses were mixed with 49% respondents supporting this policy option, 6% neutral and 45% do not support. Multiple constituents expressed a desire for an exception for edge cases that are financially or spatially infeasible. Those opposed are concerned about upfront costs or are generally opposed to all local building electrification policy. The Sustainability and Infrastructure Commission and Community Relations Commission were supportive of this policy pathway.

Cost Effectiveness and Equity Considerations
Although the Two-Way AC policy would mandate installation of a two-way heat pump at time of replacement, this retrofit is highly cost-effective as it can both cool and heat a space, effectively replacing both a central air conditioner and furnace within a home. This reduces the need for separate furnace replacements. Implementing a Two-Way AC policy is particularly advantageous given the upcoming BAAD Zero NOx requirements.

If a constituent's air conditioner breaks before 2029 and is replaced with a gas HVAC system, they will need to purchase an electric furnace when their furnace eventually breaks after the 2029 BAAD Zero NOx implementation date. Conversely, adopting a Two-Way AC policy in preparation for these requirements would ensure that all air conditioner replacements in the next few years have two-way heating and cooling capabilities and comply with BAAD’s ruling. This would prevent homeowners from installing outdated gas appliances for heating and cooling, which could be replaced by a single heat pump.

Additionally, the difference between a central AC and a two-way heat pump is essentially zero (from a $1,000 savings to a $1,000 cost) especially after the applied $1,500 rebate from Peninsula Clean Energy.

Peninsula Clean Energy (PCE) also offers on-bill financing through the Zero Percent Loan program11 to cover the up-front costs of installing a heat pump, which leads to utility bill savings over time due to appliance efficiency. This financing model can be particularly advantageous for low-income tenants who might not have access to traditional financing options. It removes the need for credit checks and upfront payments, making energy efficiency upgrades more accessible. Additionally, on-bill financing can be an effective way for tenants and landlords to manage payment responsibilities for energy efficiency upgrades. Tenants could enjoy the benefits of lower utility costs, without being tied to a load if they move (because the payment is tied to the meter rather than a person) and the landlord can improve their building without needing to pay an upfront cost.12
A Flex Path reach code is also cost-effective by providing a range of retrofits and upgrades that building owners can choose from, allowing them to pick the most cost-effective and efficient options. Based on a conducted cost analysis conducted by the Local Codes and Standards team, each check list item would need to be demonstrated to have cost savings over the lifespan of the upgrade. Figure 3 shows some of the cost-effective strategies for the City of San Mateo based on the 2022 Title 24 Building Code. Heat pumps provide the most cost-effective solutions, often paying back in 6-7 years. Furthermore, many homeowners may receive additional savings through incentives provided by PCE, the State (Tech rebates) or the Inflation Reduction Act.
11 Peninsula Clean Energy. 2025. 0% financing & rebates. Available: https://www.peninsulacleanenergy.com/residential/financing/ 12 United States Department of Energy. Issue Brief: Low-income Energy Efficiency Financing through On-Bill Tariff Programs. Available: IB L-I EE Financing through On-Bill Tariffs_Final_0.pdf
1015 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
12 Figure 3 Cost Effective Existing Building Upgrades (Cost Effectiveness Explorer) Both the Two-Way AC and Flex Path policies emphasize cost-efficient solutions for both the short and long term, ensuring that the City maintains equitable and sustainable practices.

Policy Findings
Both a Two-Way AC policy and Flex Path policy promote cost-efficient and equitable solutions for building decarbonization. Implementing these policies would help the City achieve meaningful greenhouse gas reductions, get closer to climate goals, prepare the community for future regulations, and support residents in making energy-efficient upgrades. Both of these policies fit with the community feedback received by pursuing climate action and decarbonization policies but being sensitive to cost impacts, the need for flexibility, and reliability/resilience.

Policy Option 3: Require electric equipment upon replacement ahead of BAAD’s Zero NOx requirements
Description
BAAD will require zero NOx (currently the only options for Zero NOx appliances are all-electric) appliances for water heating by 2027 and space heating by 2029. This policy bans the sale of qualifying NOx -emitting appliances in the Bay Area, requiring all-electric appliances when covered gas appliances are replaced.

Option 3 has the greatest potential to achieve GHG reductions and the goals outlined in the City’s CAP by moving faster than the 2027 and 2029 timelines outlined by BAAD. However, it could also result in higher upfront costs especially for space heating. Under this policy the City would adopt and implement a local version of the BAAD zero N0x threshold ahead of the current schedule to require all new space and water heating to have zero NOx emissions, and therefore, zero GHG emissions.

This ‘time of replacement’ ordinance would require the replacement of gas water heaters and space heaters with zero NOx versions when they fail or are voluntarily upgraded. This approach maximizes the lifespan of the existing gas appliances and reduces the cost of compliance as the increased cost would only be the difference between a gas appliance and the upgraded electric appliance. Focusing on time-ofreplacement is the most cost-effective approach for the building owner. Furthermore, since these 1016 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
13 appliances may function for dozens of years, it also is the timeliest option to replace gas appliances with electric-run appliances instead of locking in emissions from natural-gas appliances which could potentially continue to operate past the City’s target for carbon neutrality.

Policy Pros:
• Community and workforce prepared for 2027 and 2029 BAAD requirements • On-bill savings for homes that go all-electric
• Largest GHG emissions reduction potential
Policy Cons:
• Higher upfront costs for residents for home electrification • Uncertainty of incentives
• Some homes may face electrical upgrades (panels or service lines) that increase costs and lengthen timelines for replacement
Other Cities and Legislative Drivers
The BAAD requirements will be implemented in 2027 and 2029 and getting ahead of the ruling offers an opportunity to have the highest GHG impact. Currently, there are no jurisdictions who have adopted this policy for existing buildings.

Greenhouse Gas Reductions Potential
A zero NOx equipment requirement policy would have the most significant impact on greenhouse gas reductions with the ability to reduce emissions an average of 9,700 MT CO2e per year by 2030 assuming a zero NOx policy was put in place for water heating and space heating in 2026 for residential/small commercial appliances and 2028 for larger commercial appliances.

Community Feedback
Feedback on this policy was largely unfavorable. In the community survey, 44% of respondents supported this policy option, 5% neutral, and 48% do not support. Those opposed were concerned about getting ahead of the Air District’s schedule and challenges with compliance and enforcement. Those who support this approach emphasize that this approach has the greatest GHG reduction potential. The Community Relations Commission was supportive of this policy pathway.

Cost Effectiveness and Equity Considerations
Based on the initial cost study conducted for this project, a zero NOx policy median-cost scenario could increase water heating incremental costs by $3,200 and space heating incremental costs by $11,778 before rebates. However, between state, local, and federal incentives high income households could see an overall cost savings for water heaters and incremental costs of $5,878 dollars for space heating. When also considering the avoided cost of an AC unit (once it breaks down) from installing a two-way heat pump that acts as a furnace and an AC unit, then the incremental costs in a median-cost scenario for space heating would be $4,278 before rebates and incur cost savings with rebates. Similar conclusions were 1017 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
14 found in another cost study done for BAAD.15 However, many of the incentives originally modeled for this analysis have changed or have uncertain futures, especially at the federal level.

Similarly to Policy Option 2, residents could utilize on-bill financing from PCE to cover up-front costs of electric water heater or space heating appliances, utilizing a zero percent interest loan and repaying that installation cost over time via their utility bill.11 The PCE program fosters equitable installation of electric equipment and allows renters to enjoy the same energy savings as homeowners. However, the availability of rebates and incentives is volatile which could impact the cost-effectiveness of an electric-appliance mandate.

Policy Findings
A Zero NOx Equipment Requirements policy would achieve the highest greenhouse gas emissions reduction , mandating electric heat pump water heaters and furnaces ahead of the BAAD requirement.

This policy offers a significant opportunity to reduce GHG emissions and capture appliance replacements over the next four years before BAAD’s mandate is fully implemented. Implementing this policy could potentially save residents money depending on the availability of rebates on water and space heating appliances. However, there are cases in which this policy could result in increased upfront costs for homeowners, which was the biggest concern identified in Phase II of engagement. The changing rebate landscape also makes it difficult to understand how costs will change over time. Due to the polarized community feedback, with some constituents being unsupportive of mandates, it may be difficult to garner public buy in for a Zero NOx Equipment Requirement policy.

Policy Option 4: Commercial Building Performance Standards Description
Option 4 introduces new policy standards for commercial buildings (Building Performance Standards) aimed at increasing energy efficiency, and eventually, decarbonizing commercial buildings as a phased efficiency-focused approach. In comparison to relatively homogonous residential buildings, commercial buildings can be highly variable in their systems and needs. Commercial building heating and cooling systems are also frequently oversized, meaning replacing existing gas equipment in a like for like manner with electric equipment is not economical. Process loads also vary significantly across commercial building types. For these reasons, decarbonizing commercial buildings necessitates a flexible approach where building managers can first make strides towards understanding their buildings and cost-effective opportunities before committing to a specific approach. Typically, a BPS Program is implemented in phases where buildings first report energy use for several years (benchmarking), then perform a retrocommissioning process to identify opportunities before finally reducing emissions below an established threshold (performance standard).
• Phase I: Benchmarking (Years 1-2): This initial phase establishes a building’s energy performance baseline by comparing its energy use intensity (EUI) to similar buildings. Covered Buildings (buildings and properties with buildings totaling the specified size threshold or larger) report their annual energy usage in Energy Star Portfolio Manager. The data collected in the benchmarking phase improves 15 BAAD. 2024. Installation Costs for Zero-NOx
Space and Water Heating Appliances. Available:
https://www.baaqmd.gov/~/media/files/community-health/building-appliance-implementation/task1_electrificationcostspdf.pdf?rev=3cb66a09f3094f94b35fa7fc90cfd4ec&sc_lang=en 1018 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
15 building manager and City understanding of building energy usage and will inform GHG-emissions performance standards. Benchmarking also identifies underperforming facilities and prioritizes improvements, with studies showing benchmarked buildings achieve average annual energy savings of 2.4 percent.17
• Phase II: Retro-commissioning (Years 3-4): Retro-commissioning is a process through which a building’s energy consuming systems are analyzed for efficiency and proper operation. The retrocommissioning process serves two primary purposes. The first is to uncover inefficient operations, increase energy efficiency, and save building owners money. The second is to identify cost-effective opportunities to reduce building GHG emissions through electrification and energy efficiency. • Phase III: Performance Standard (Year 4+): Jurisdictions set phased energy or emissions targets for GHG reductions over time on a square feet basis. The targets are based on data collected from the benchmarking phase and can be met through a variety of retrofits, such as upgrades, electrification, or renewable energy adoption. The most cost-efficient retrofits for each building were identified in the retro-commissioning phase. Standards often allow flexible compliance paths, such as achieving specific EUI thresholds or offsetting emissions via clean energy investments.

Policy Pros:
• BPS approach addresses a high degree of variability in commercial building types by focusing on performance-based requirements
• Phased approach allows for structured guidance for facility managers, uncovering cost savings over time
• Focuses on worst performing buildings first
• Reduces pressure on harder to electrify equipment types (e.g. gas stoves) through phased approach, longer runway for electric equipment to become widely available and cost-effective on-market • Robust programming examples from Cities who have already implemented • Tiers off of existing State energy disclosure laws (AB 802) Policy Cons:
• Necessitates new staff time and staff members to implement and track BPS • Does not guarantee all-electric end usage in short term until phased retro commissioning phase, potentially missing some appliances that could be electrified • Limited building stock reach, best suited to large commercial buildings (for example buildings >25,000 sq ft)
• Possibility to have equity implications from increased rents in multifamily if tenant protections are not integrated into the policy
Other Cities and Legislative Drivers
Commercial Building Performance Standards are already mandated by California’s statewide building energy benchmarking and public disclosure law (AB 802), which require owners of commercial and 17 National Association of State Energy Officials. 2025. Benchmarking and Building Performance Standards. Available:
https://www.naseo.org/issues/buildings/benchmarking
1019 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
16 multifamily buildings 50,000 square feet or larger to annually benchmark and report their whole-building energy usage to the California Energy Commission. A City BPS could implement the same threshold as the state or have a more stringent threshold including buildings with a smaller square footage. • Compared to other policy approaches listed here, building performance standards are a wellestablished policy mechanism that has been adopted by many local governments including the City of San Jose, City of San Francisco, and City of Brisbane. City of Brisbane Building Efficiency Program passed in 2019, requires annual energy and water benchmarking and reporting, and compliance with Beyond requirements to show that they are high performing, or improving performance for commercial buildings 10,000 SF and larger.19
• City of San Jose’s Energy and Water Building Performance Ordinance passed in 2018 and requires commercial and multifamily buildings above 20,000 square feet to annually benchmark and report their energy and water usage. Beginning in 2023, building have been required to meet energy and water efficiency standards on a rolling five-year basis.20 Greenhouse Gas Reductions Potential
Commercial building space makes up over 39 million square feet within the City with 44 percent and 30 percent coming from space and water heating respectively. The building performance standard would likely not result in significant GHG emissions reductions before 2030 due to the phased in nature of the program. However, 83,660 MT CO2e were generated by commercial buildings in 2019 These emissions could be reduced by 2045 depending on the final thresholds adopted by the City.21 Community Feedback
Across engagement events, community members were supportive of a BPS policy. In the community survey, approximately 58% of respondents were supportive of a BPS policy, 12% neutral, and 29% do not support. The Senior Advisory Commission, Sustainability and Infrastructure Commission, and Community Relations Commission were supportive of this policy pathway.

During our direct outreach to building owners and developers, respondents understood the importance of a BPS policy and made suggestions of how to set thresholds to be most efficient and minimize unnecessary costs like setting individual reductions targets measured against a buildings own emissions rather than a City average and including a vintage threshold to exclude new buildings which are already more efficient. Building owners also shared that limited physical space for electric equipment upgrades and complicated tenant lease structures would be challenges to implementation that building owners would need guidance navigating.

Cost Effectiveness and Equity Considerations
The cost of decarbonizing buildings under a Building Performance Standard (BPS) policy varies significantly based on factors such as building age, equipment types, and energy end uses. This variability necessitates 19 https://www.brisbaneca.org/bbep
20 https://www.sanjoseca.gov/your-government/departments-offices/environmental-services/climate-smart-san-jos/energy-and-waterbuilding-performance-ordinance 21 City of San Mateo Climate Action Plan (Page 41) https://www.cityofsanmateo.org/DocumentCenter/View/93755/Climate-Action-Plan-2024- Update?bidId=
1020 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
17 a flexible, performance-based approach, allowing owners to prioritize cost-effective solutions tailored to their assets. The BPS framework’s phased implementation mitigates financial burdens:
• Benchmarking identifies inefficiencies (e.g., leaks, malfunctioning systems) and establishes a baseline for improvement. Benchmarking reporting costs approximately $3,000 annually. • Retro-commissioning pinpoints low-cost operational optimizations (e.g., HVAC adjustments, controls recalibration), which typically yield 16% energy savings at an average cost of $0.30/sq. ft., often with payback periods under two years.
• Performance standards are deferred for 4+ years post-benchmarking, enabling strategic capital planning for equipment replacements and system upgrades.

Electrification of commercial building electric retrofits will likely have to be paired with a suite of demand management, energy efficiency, or renewable energy projects in order to make building electrification economical for building owners. Specific cost-effective system upgrades include heat pump rooftop package units, which are the most promising electrification solution for commercial building electrification, offering a replicable model for a 1:1 equipment swap-out.25 Analysis from PCE found that for these easy to electrify units (packaged/split units with both heating and cooling) the marginal costs to upgrade to an all-electric packaged or split heat pump system were found to be negligible as shown in 3.

Figure 4 PCE 2035 Decarbonization Plan Rooftop Package Unit Marginal Cost Analysis Equity is addressed by allowing building-specific compliance pathways and avoiding prescriptive mandates that could disproportionately burden older or under-resourced properties. There are additional equity implications when considering multifamily housing which could exacerbate disparities and lead to rent increases if not properly designed. Key considerations for equitable BPS implementation include anti25 Rocky Mountain Institute. 2022. Medium-Size Commercial Retrofits. Available: https://rmi.org/insight/economics-of-electrifying-buildingsmedium-size-commercial-retrofits/ 1021 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
18 displacement measures for buildings that receive any City subsidy, incentive, or funding. Equity implications and design measures for multifamily are still being investigated. Due to the phased in nature of this program, those considerations can be addressed over time, but before thresholds for reductions are finalized (year 4+).

Policy Findings
A BPS policy builds on state legislation and addresses a large source of emissions reductions. There is overall community support and flexible and cost-efficient implementation. However, a BPS policy obligates a significant amount of staff time. Therefore, for efficient implementation, the City could set a threshold that would maximize the captured square footage while minimizing the number of impacted building owners. A threshold that initially only applies to buildings greater than 50,000 square feet (which are already mandated to report benchmarking data under AB 802) would ensure the City’s building stock is complying with state law and allow the City to understand the benchmarking process without a significant staff burden.

Policy Option 5: Municipal Electric First Policy
Description
This policy establishes a mechanism for local government renovations to go ‘electric first’. This means that new appliance purchases, renovations, and replacements should prioritize using all-electric equipment.

This policy would also allow for technical and cost infeasibility on a project-level when an all-electric alternative is either not available or deemed infeasible due to cost. The main purpose of the policy is to position the City as the leader in decarbonization within the community as well as prepare City facilities for upcoming requirements. The City would also learn best practices through this approach which it can share with the community and electrified city facilities would serve as demonstration buildings to highlight the comfort, health, and safety benefits of going all-electric.

Policy Pros:
• Demonstrates City leadership in building electrification • Availability of significant local government incentives to electrify through Peninsula Clean Energy’s Gov BE and Willdan GK12 program
• Existing resources available through County of San Mateo including staff report, model code language, and case studies
• Prepares City for future requirements while incentives are available • Lower operating costs
Policy Cons:
• Limited reach as policy only covers municipal buildings Other Cities and Legislative Drivers
Some other jurisdictions who have implemented this policy include:
1022 of 1111
City of San Mateo
Electrify San Mateo: Policy Pathways Analysis
19 • City of Mountain View: Municipal Green Building Policy (2020): requires analysis of opportunities for electrification upon major upgrade of City-owned buildings, and develops a minimum of LEED Gold for new construction.27
• City of San Diego: Zero Emissions Municipal Buildings and Operations Policy (2022): any time a natural gas burning system is being replaced, requires the new equipment to be electric.28 Greenhouse Gas Reductions Potential
In 2005 municipal natural gas use was 86,096 therms which equates to approximately 586 MT CO2e annually after accounting for natural gas leakage. If fully implemented, the electric first policy would aim to reduce these emissions over time as equipment needed replacement. The total reductions by 2030 and 2045 would depend on the availability of all-electric replacements and the rate of equipment failure.

Community Feedback
Across community engagement events, there was broad support for this policy option. In the community survey, approximately 60% of respondents were supportive of this policy option, 15% neutral, and 24% do not support. Multiple constituents and building owners expressed a desire for the City to better understand the permitting process and technical implications, which would be achieved if the City led first by example. The Senior Advisory Commission, Sustainability and Infrastructure Commission, and Community Relations Commission were supportive of this policy pathway.

Cost Effectiveness and Equity Considerations
This policy enables the City to conduct a comprehensive feasibility assessment to evaluate the cost differentials between electrification and gas equipment replacement for municipal facilities. By incorporating exemptions for projects demonstrating technical or financial infeasibility, the policy ensures a targeted approach to identifying the most cost-effective energy upgrades, consistent with methodologies applied to commercial buildings. Implementation costs will vary based on building-specific factors, including system age, infrastructure readiness, and operational requirements.

As these facilities are City-owned, the municipality retains full decision-making authority over capital expenditures, eliminating potential equity concerns that might arise in privately owned housing or commercial properties. Furthermore, since many City owned facilities are used by the public such as libraries or park properties, creating healthier and more comfortable spaces while lowering operational costs provide an equity benefit to the community. This approach ensures alignment with both fiscal responsibility and the City’s broader decarbonization objectives.

Policy Findings
The adoption of a Municipal Electric First Policy establishes a process to systematically evaluate electrification opportunities during renovations and new projects for City-owned facilities. This policy aligns with the City’s climate goals while providing data-driven insights into cost and feasibility, enabling informed decision-making for future building decarbonization efforts. Furthermore, the municipal electrification first policy saw general support throughout the community engagement process. 27 https://www.mountainview.gov/home/showpublisheddocument/790/637940944813700000 28 https://www.sandiego.gov/sites/default/files/zero_emissions_municipal_buildings_operations_policy.pdf 1023 of 1111
Rincon Consultants, Inc.
66 Franklin Street, Suite 300
Oakland, California 94607
510-834-4455
w w w . r i n c o n c o n su l t a nt s . c o m
June 16, 2025
Andrea Chow, Sustainability Analyst
City of San Mateo
330 West 20th Avenue
San Mateo, California 94403
Via email: [email protected]
Subject: Summary of Conducted Community Engagement for Electrify City of San Mateo A major component of the Electrify San Mateo: Sustainable Buildings Strategy is a robust community engagement process. This project aims to create an actionable roadmap with steps for City of San Mateo to electrify buildings based on effectiveness and equity criteria, cost-effectiveness, best available science and data, and community feedback. Community outreach and public input are fundamental to shaping effective, equitable, and successful decarbonization policies. This memorandum summarizes the engagement conducted by both City staff and Rincon Consultants between Spring 2023 and Spring 2025.

Executive Summary of all Outreach
Outreach has been conducted in two phases to understand community priorities, concerns, and needed support for successful policy implementation. During Phase I of engagement, the City presented at multiple meetings to gather feedback on the equity and effectiveness criteria and educate the community about costs and benefits of building electrification. This included a meeting with the Sustainability and Infrastructure Commission, a City Council meeting, five General Plan Town Hall meetings, and an online survey. After Phase I of engagement, the initial suite of policy pathways was narrowed down to five policy pathways to advance existing building electrification within San Mateo.

Phase II of engagement aimed at further refining these priority policies for inclusion within the final Electrify San Mateo: Sustainable Buildings Strategy. During Phase II, the community engagement efforts included an in-person workshop and an additional virtual workshop for community members which focused on the five policy pathways, a virtual information session on Building Performance Standards for commercial building owners, presentations at City Commissions and community and stakeholder meetings, and an online survey.

Throughout the community engagement process, there have been polarized responses to building electrification. While most constituents care about addressing the climate crisis and agree that the City should pursue existing building electrification in some form, many residents also expressed concerns.

The primary constituent values identified during Phase I and Phase II engagement that are motivating building electrification included:
• Urgent need to address the climate crisis is a priority issue • Health and air quality benefits of building decarbonization • Need for local action and the City to act now
• Availability of electric equipment incentives and rebates to support property owners 1024 of 1111
City of San Mateo
Summary of Conducted Community Engagement
2 The primary concerns identified during Phase I and Phase II engagement included:
• Upfront costs of electric equipment
• On-bill or operational costs of electric equipment
• Installation and electrical infrastructure challenges • Grid reliability and resilience
• Lack of education surrounding electrification
In general, the results of the community outreach conducted by the City point to a general desire to address climate change and decarbonize buildings tempered by concerns about cost and feasibility.

Based on these findings, a focus on policies that support decarbonization when cost effective and efficient while providing flexible alternatives for particularly challenging cases should be prioritized.

Below is a detailed summary of outcomes and themes from each engagement event. A record of public comments and photos is listed at the end of this memorandum.

Community Engagement Phase I: Community Concerns and
Values
During Phase I of engagement, the City held multiple events to gather feedback on the equity and effectiveness criteria and educate the community about costs and benefits of building electrification. The goal of this phase was to both provide information to the community on what building electrification is and why the City is pursuing it, as well as learn about the core values and concerns the community has around upgrading their homes and businesses. This included a meeting with the Sustainability and Infrastructure Commission, a meeting with the Equity and Inclusion Task Force, a City Council meeting, five General Plan Town Hall meetings, and an online survey.

General Plan Town Hall Meetings
In Fall of 2023, five General Plan Town Hall meetings were held to solicit feedback on the City’s General Plan Update. The General Plan Town Hall events were in-person events located throughout the community, one event in each of San Mateo’s five districts. At each outreach event, doors opened at 5:30 pm to allow attendees to view poster boards (example at end of memorandum) on various topics (circulation, land use, safety, noise, etc.) with a formal presentation on the Draft General Plan at 7:00 pm.

An average of 60 community members attended each event.

The project team had a poster board summarizing the Sustainable Buildings Strategy project effort.

Community members were very engaged at the Sustainable Buildings Strategy poster board. Staff received a mix of both supportive feedback for working on electrification requirements as well as concerns about costs related to electrification.

Diversity Equity and Inclusion Task Force Presentation
On September 22, 2023, presented to the City’s Diversity Equity and Inclusion Task Force. Feedback from the Task Force included: the need to include education, data, and storytelling in outreach. The Task Force’s biggest concerns regarding electrification were related to the electric power outages and costs 1025 of 1111
City of San Mateo
Summary of Conducted Community Engagement
3 to homeowners. The Task Force also helped identify follow up opportunities for partnerships and project outreach.

Sustainability and Infrastructure Commission Meeting
At the September 13, 2023 Sustainability and Infrastructure Commission meeting, staff and the consultant team presented the building inventory and market segmentation analysis as well as building electrification cost analysis. Over 120 written public comments were submitted for the item with the majority in support of decarbonization. 24 verbal comments were also provided at the meeting.

Proponents of decarbonization support electrification policy efforts to reduce gas use in the community to combat climate change, improve air quality, and improve health. Proponents also encouraged the leveraging of incentives and rebates for electrification.1 For those opposed, the number one concern about electrification is the costs to the property owner. Other concerns include power outages, growth of the grid to accommodate future electric buildings, and passed on costs to renters.

Survey
The project team also launched an online survey to assess community priorities for building electrification that was open December 2023 through January 10, 2024. Results of the online survey were shared at the January 16, 2024 City Council Study Session. A summary of the survey results is included below. The survey had a total of 194 respondents from a wide range of socioeconomic backgrounds as shown in Figure 1 and Figure 2 .
1 San Mateo, City of. 2023. Public Comments Submitted for the August 9, 2023 SIC Meeting. Available:
https://sanmateo.primegov.com/Portal/viewer?id=9062&type=2. 1026 of 1111
City of San Mateo
Summary of Conducted Community Engagement
4 Figure 1 Household Income of Survey Respondents
1027 of 1111
City of San Mateo
Summary of Conducted Community Engagement
5 Figure 2 Race of Survey Respondents
The Phase I survey primarily focused on what priorities and concerns the community had relating to buildings and building decarbonization. As shown in Figure 3, affordable energy costs was the highestranking quality for San Mateo Buildings, followed by a tie between Health and Safety and Resilience.

Climate and sustainability ranked fourth followed by Modern Appliances and Functionality.

Respondents also provided feedback on their biggest concerns regarding building electrification in San Mateo. Figure 4 shows that increasing energy bills was the largest concern relating to building electrification. This concern was followed by concern over increased housing/rent costs as the second most common concern. Respondents also ranked difficulty in accessing rebates (3rd) and building electrification ignoring other more pressing building issues (4th) as primary issues that would need to be addressed.
1028 of 1111
City of San Mateo
Summary of Conducted Community Engagement
6 Figure 3 Survey Respondents Most Important Building Qualities 1029 of 1111
City of San Mateo
Summary of Conducted Community Engagement
7 Figure 4 Concerns Relating to Building Electrification in San Mateo These survey results highlighted major concerns of building electrification of both upfront and on-bill cost, reliability concerns, and challenges accessing the funding and financing opportunities meant to decrease the cost of electrification. These topics were carried through into Phase II of outreach as the project team worked to refine the policy options based on community feedback. 1030 of 1111
City of San Mateo
Summary of Conducted Community Engagement
8 City Council Meeting
In January of 2024, Rincon Consultants and City staff provided a presentation to City Council on the Phase I results. The presentation focused on the results of the building segmentation analysis, cost analysis, engagement to date, and initial policy recommendations. During this meeting five policy options were provided for City Council feedback including:

1. Continue adopted reach codes and focus on outreach and incentives (Business as Usual)

2. Explore and adopt new reach codes to encourage and require electrification

3. Require electric equipment upon replacement ahead of the Bay Area Air District’s Zero NOx requirements

4. Establish Building Performance Standards for commercial buildings

5. Adopt an electric-first policy for City facilities
City Council provided feedback which included direction for City Staff to continue exploring the feasibility, cost, and community support for each of the five options.

Community Engagement Phase II: Policy Pathways Feedback Following direction from City Council, City staff with support from Rincon Consultants, conducted additional outreach on the five policy strategies presented to City Council during Phase I. Phase II outreach events included an in-person community workshop, virtual community workshop, virtual meeting with commercial building owners, presentations to community and developer groups, and several upcoming Commission meetings. A second survey was also developed and distributed through these and other City channels. The second survey was developed to get more detailed information about support for/concern around the five policy pathways.

Each community meeting and survey was advertised to the community through multiple avenues including the City’s social media channels, e-newsletter, and at City events, and to individuals who attended prior events.

The following sections detail the feedback received from the community during each engagement opportunity.

In-Person Community Feedback Meeting
Feedback Meeting Summary
The in-person community feedback meeting was advertised to the community through multiple avenues including the City’s social media channels, City e-newsletter, and direct emails. There were 20 attendees.

The in-person community feedback meeting took place on March 5th, 2025 from 7:00 p.m. to 8:00 p.m. at the San Mateo Public Library. The goals of the meeting were for participants to:
1) Understand the definition and importance of existing building electrification in the context of climate change and the City of San Mateo’s climate goals
2) Note an overview and timeline of the City of San Mateo Sustainable Buildings Strategy 3) Recognize previously shared concerns and solutions about existing building electrification 1031 of 1111
City of San Mateo
Summary of Conducted Community Engagement
9 4) Be introduced to the five policy options and how each would impact the community 5) Share community feedback on the policy options through an interactive “Sailboat” Activity and Voting Activity
A total of 25 community members attended the feedback meeting. City of San Mateo Sustainability Analyst, Andrea Chow, began the meeting and introduced Ryan Gardener, Director of Climate Action and Adaptation at Rincon Consultants, who gave a 25-minute presentation on goals one through four described above. Community members had the opportunity to ask questions a various points during the presentation.

After the presentation, community members were split into three groups to participate in the Sailboat Activity facilitated by a City or Rincon staff member. Each group contained a variety of members including industry professionals like contractors, climate activists, students, and renters and homeowners who have electrified portions of their own homes. The Sailboat Activity helped community members brainstorm electrification challenges and support solutions to help the City achieve its decarbonization goals. The activity featured a poster board with a sailboat heading for an island while being supported by wind and held back by an anchor. The island represents the City’s decarbonization goals, the anchor represents barriers and challenges keeping the City from achieving its goals, and the wind represents various policy and support solutions to help the City reach its goals. Using post-it notes, participants were asked to first brainstorm various “anchors” or barriers to success. Then, participants were asked to brainstorm various solutions, or “wind”, to overcome such “anchors”. The activity lasted approximately 25 minutes.

After the Sailboat Activity, community members were asked to participate in a final Voting Activity where they used post-its on a large posterboard to vote for as many of the five policy options that they would support the City adopt. There was also a “do nothing” option where participants could show that they did not support any electrification policy. Any community member who voted and left their email on a post-it was entered into a raffle for the chance to win one $50 visa gift card.

Key results from each activity are included below, and a full record of all activity responses and photos are included in the Appendix.

Sailboat Activity Themes
Between the three groups, participants shared 30 “anchor” comments and 41 “wind” comments. Overall, the main concerns in the “anchor” category included costs, lack of education, grid reliability, equity, supply issues, and resistant social factors. The main support requested in the “wind” category included cost savings, education and outreach, grid reliability, equity programs, adequate supply, and a changing market. Below is a summary of comments in each section.

Anchor Comments
1) Cost
a. Unexpected upgrades
b. Expensive quotes
c. Speed of installation
d. $52,000 to fully electrify and $30k to $40k in rebates 1032 of 1111
City of San Mateo
Summary of Conducted Community Engagement
10 e. Uncertainty of federal incentives
2) Lack of Education
f. Complicated topic
g. Confusing software
h. Confusing permitting process
i. Lack of communication between City departments
3) Grid Reliability
j. Unexpected utility shut offs
k. Demand response software
l. Emergencies
4) Equity
m. Unclear how renters fit into electrification
n. Concerns with mandates
5) Supply issues
o. Equipment availability
p. Contractor availability
6) Social factors: people and industries are resistant/ have a fear of change q. Loss of aesthetics (fireplaces, etc.)
r. Perception of convenience/ procrastination
s. Too many setup variations (space, house layout)
Wind Comments
1) Cost Savings
a. We need incentives – Credits & Rebates, lower interest loans and On bill loans (PG&E) b. We need to waive city building permit fees for electric upgrades c. Operation Cost – Gas, Water, Heater is more expensive d. Cost of Rebuilding after disaster is way more
e. Solar + Batteries + All Electric = Lower energy costs f. Better health – Lower medical bills
2) Education/ Outreach Programs
g. Home Tours – Peer to Peer Education (led by non-profits) h. Collaborate and share solutions with other jurisdiction (like Cupertino or San Carlos) i. Need a “Vision” to strive for and rally behind
j. Volunteer Advisor Program
k. Residential education on AC & Heat Pumps
l. Collaboration between contractors, City, residents, and non-profits 1033 of 1111
City of San Mateo
Summary of Conducted Community Engagement
11 m. Targeted marketing to those who already have solar/ those who installed an appliance 10 years back
n. Contractor training
o. Communications tool to consider upgrade costs specific to home insulation, wiring return flow ducts
p. Education about climate benefits, health benefits, safety benefits q. Electrification Starter Pack
r. Peninsula Clean Energy Help Desk
s. Advertising/ signage for electrified homes with QR code to more resources t. Need data about what works and what hasn’t
3) Grid reliability
u. Solar + Batteries + All Electric = Resiliency
4) Equity Programs
v. Support for renters
w. Credits people of color
x. 0% interest rate or community fund for people with low income 5) Supply chain
y. Need guaranteed supply of the incentivized electrified appliances z. Need service availability
6) Social factors: changing market
aa. When the electric appliances perform better, they will be more attractive than gas bb. Gas exposure causes health problems
cc. Green homes
Voting Activity Results
There was support for the following policy options:
1) Business as Usual: 0 supporters
2) Reach Codes for Renovations: 9 supporters
3) Zero NOx Equipment: 14 supporters
4) Commercial Building Performance Standard: 11 supporters 5) Municipal Electric First Policy: 11 supporters
6) Do Nothing: 0 supporters
1034 of 1111
City of San Mateo
Summary of Conducted Community Engagement
12 Virtual Community Feedback Meeting
Feedback Meeting Summary
The virtual community feedback meeting took place on March 13th, 2025 from 12:00 p.m. to 1:00 p.m. via Zoom to provide an alternative time to the in-person meeting for community members to actively engage with the policy feedback process. The goals and meeting format were the same as the in-person event. 11community members participated in the virtual feedback meeting.

Andrea Chow and Ryan Gardner facilitated the meeting. After the 25-minute presentation, community members participated in the same Sailboat Activity as the in-person meeting but in a virtual format.

Participants remained in one large group using the engagement software Mural. Community members could enter comments into the Mural board themselves or leave comments in the chat or unmute themselves and leave verbal comments for Rincon staff to add onto the Mural board on their behalf.

After the Sailboat Activity, community members were asked to take an exit poll to vote for as many of the five policy options that they would support the City adopt. There was also a “do nothing” option where participants could show that they did not support any electrification policy. Any community member who voted was entered into a raffle for the chance to win one $50 visa gift card.

Key results from the virtual Sailboat Activity and exit poll are included below, and a full record of all activity responses, meeting chat, and photos are included in the Appendix.

Sailboat Activity Themes
Participants shared 9 “anchor” comments and 12 “wind” comments. Overall, the main concerns in the “anchor” category included costs, lack of education, grid reliability, technology and engineering challenges, equity, and legislative red tape. The main support requested in the “wind” category included: cost savings, education, equity, and technology solutions. Below is a summary of comments in each section.

Anchor Comments
1) Cost
a. Large percentage of buildings that cannot replace at end of life at a reasonable cost 2) Lack of education
b. Lack of information and support for implementation
c. Lack of cohesive city support for resident transitions 3) Grid reliability
d. power outages/ need grid resiliency
4) Technology and engineering challenges
e. lack of drop-in products (40G small diameter water heater will not be available for another few years)
f. difficult targets are multifamily homes in City of San Mateo are not well suited for heat pump upgrades. Electrical power is an issue, as requirements for engineered solutions 1035 of 1111
City of San Mateo
Summary of Conducted Community Engagement
13 5) Equity
g. Rent increases in multifamily
6) Legislative red tape
h. PG&E policies against solar
Wind Comments
1) Cost savings
a. Start with low hanging fruit
b. must identify easy targets where building envelope is more important than heat pumps 2) Education
c. Peer coaching
d. Collaboration with San Mateo County Heat Pump Advocates e. Need info on total GHG reductions for each option
f. Work together with manufacturers of electric equipment g. Watt diets
h. Learn form other Bay Area cities
3) Equity
i. Tie incentives to renter protections
j. exemptions for difficult cases
4) Technology solutions
k. Saddle mounts and "copper" battery powered stoves
Exit Poll Results
Of the five people voted and entered their emails, there was support for the following policy options:
1) Business as Usual: 2 supporters
2) Reach Codes for Renovations: 3 supporters
3) Zero NOx Equipment: 0 supporters
4) Commercial Building Performance Standard: 2 supporters 5) Municipal Electric First Policy: 1 supporters
6) Do Nothing: 1 supporters
San Mateo United Homeowners Association Feedback Meeting Feedback Meeting Summary
The San Mateo United Homeowners Association (SMUHA) meets regularly to coordinate efforts between neighborhood and homeowner associations. The project team presented at the March 20th meeting at 7pm. There were 10 attendees.
1036 of 1111
City of San Mateo
Summary of Conducted Community Engagement
14 Results and Themes
Similar to other feedback, most attendees voiced concern about the potential costs to property owners and the potential for costs to be passed on to renters. There was discussion of grid resilience and PG&E power safety shut offs. Most attendees were opposed to the City moving too quickly on building electrification policy.

Commercial Building Performance Standard Information Session Feedback Meeting Summary
The virtual Commercial BPS Information Session was advertised to building owners with buildings above 50,000 square feet through email. City staff spoke at the Chamber of Commerce Public Policy Group and Chamber of Commerce Developers Roundtable to promote this event. The City and Rincon Consultants created a BPS 1-pager explaining the relevance of the policy to distribute to building owners (available at end of this memorandum).

The virtual Commercial BPS Information Session took place on April 10th, 2025 from 10:00 a.m. to 11:00 a.m. over zoom. The goals of the meeting were for participants to:
1) Learn about the importance of a Building Performance Standard in the context of the City’s climate goals and legislation advancing a BPS across the state
2) Note an overview and timeline of the City of San Mateo Sustainable Buildings Strategy 3) Learn about the phased implementation process of a Building Performance Standard 4) Share feedback, concerns, and ask questions about the policy A total of six building owners attended the information session. City of San Mateo Sustainability Analyst, Andrea Chow, began the meeting and introduced Ryan Gardener, Director of Climate Action and Adaptation at Rincon Consultants, who gave a 25-minute presentation on goals one through three described above. After the presentation, building owners had the opportunity to share feedback, concerns, and ask questions about a potential BPS.

Key results from the discussion are included below, and a full record of all activity responses and photos are included in the Appendix.

Results and Themes
Overall participants were thankful for the event as they were able to learn valuable information and share their feedback and desires for implementation of the policy. Several building owners from both retail and multi-family backgrounds shared insights as to how a BPS might affect them and the ways in which the policy thresholds could be structured to make implementation more successful. The main comments included:
1) Setting a threshold based on an average of all commercial buildings (comparing old buildings to allelectric, new construction) could skew the threshold to require old buildings to convert to all-electric which could be financially infeasible. One idea provided by an attendee was to set an individual threshold where buildings must reduce their emissions compared to their own historical emissions rather than meet a City or building type average.
1037 of 1111
City of San Mateo
Summary of Conducted Community Engagement
15 4) Converting to electric appliances also creates a possible space issue as electric rooms are increasingly taking up more space and old buildings may not have room for it. Relocating equipment due to space limitations poses increased engineering and financial burdens. 5) For new construction that must meet the recent Title 24 requirements, can there be a vintage threshold to avoid unnecessary financial and time burden for buildings that are already wellperforming. 6) For landlords with complicated tenant and lease structures, landlords would need City support to navigate conversations with tenants and financial responsibility.

Survey
Survey Summary
An online survey was created to collect community feedback from those who were unable to participate in any of the other engagement events. It was shared broadly through City email listservs, social media, and during City events including the State of the City event. The survey was also advertised at the end of every engagement meeting so participants could share it with their networks.

The Phase II survey aimed to gauge support for the five policy pathways while being brief and accessible.

The survey provided a background on the project and its importance, defined the five policy options, and asked community members which of the policies they would support. Respondents could choose options “Do not support”, “Neutral”, “Support”, or “Not sure.” Respondents also had the opportunity to leave other feedback in a comment box.

Results and Themes
The survey had a total of 217 respondents from a wide range of socioeconomic backgrounds as shown in Figure 5and Figure 6.
1038 of 1111
City of San Mateo
Summary of Conducted Community Engagement
16 Figure 5 Household Income of Survey Respondents
1039 of 1111
City of San Mateo
Summary of Conducted Community Engagement
17 Figure 6 Race of Survey Respondents
Of the five policy pathways, support for each policy was polarized with large percentages of constituents supporting and opposing each policy. The results of each policy are seen in Figure 7 through Figure 11 below. Although answers were polarized, a majority of constituents supported policy options 1, 2, 4, and

5. Policy option 3 was the only policy that had a majority “do not support” vote at 47.47% versus a 43.78% support vote.
1040 of 1111
City of San Mateo
Summary of Conducted Community Engagement
18 Figure 7 Policy Option 1 Survey Results
1041 of 1111
City of San Mateo
Summary of Conducted Community Engagement
19 Figure 8 Policy Option 2 Survey Results
1042 of 1111
City of San Mateo
Summary of Conducted Community Engagement
20 Figure 9 Policy Option 3 Survey Results
1043 of 1111
City of San Mateo
Summary of Conducted Community Engagement
21 Figure 10 Policy Option 4 Survey Results
1044 of 1111
City of San Mateo
Summary of Conducted Community Engagement
22 Figure 11 Policy Option 5 Survey Results
Senior Advisory Commission
Feedback Meeting Summary
The project team presented to the Senior Advisory Commission on May 12, 2025. The Commissioners did not provide a formal policy recommendation and provided general feedback on the policy pathways.

In general, the Commissioners agreed with the need to address climate through building decarbonization and electrification, but had reservations around requirements which could result in high upfront costs (specifically Policy Option 3) for those on fixed incomes.

Results and Themes
• Most commissioners not supportive of Policy Option 3 due to the potentially high upfront costs • Lots of discussion about upfront costs and concern for community members on a fixed income • General understanding and support of project goal and need to electrify • Some interest and discussion in Policy Option 4, one commissioner pointed out how this was adopted in a lot of other cities
• Support of pursuing policy options along with providing resources and programs to help homeowners transition
• Noted need for technical support especially for older folks with less understanding of new technologies
1045 of 1111
City of San Mateo
Summary of Conducted Community Engagement
23 • Commissioners were happy to see support options from Peninsula Clean Energy • Two commissioners voiced support for Policy Option 1, 2, and 5 Sustainability and Infrastructure Commission
Feedback Meeting Summary
The project team presented to the Sustainability and Infrastructure Commission on May 14, 2025. The Commission’s policy recommendation supported Policy Options 1, 2, 4, and 5 with consideration of additional engagement and/or hardship exemptions where needed.

Results and Themes
• Discussion of greenhouse gas emission impact of different measures • Discussion of City funds and other programs/resources to support homeowners in electrification transition noted support for other programs like sewer lateral replacements • Need for programs like PCE concierge services to support transition • Some interest in Policy Option 3 but worried about compliance and concern for timeline • Concerns over Policy 2 and 3 were primarily tied to potential for high costs in edge cases. • Interest in hardship exemption language in future ordinances to help with cases that are hard-toelectrify • Some commissioners noted the need to phase in Policy 4 to ensure the City understands the costs/feasibility of commercial electrification
• Discussion of compliance challenges
Community Relations Commission
Feedback Meeting Summary
The project team presented to the Community Relations Commission on May 21 that included five Commissioners. The Commissioners made a unanimous motion to support all five policy pathways.

Results and Themes
• Commissioner discussion of engagement and messaging about current resources, programs, and rebates. Pointed out how some community members do not access information online resources and the need for in-person presentations and other channels • Commissioner discussion of language access to resources and programs and the need for different programs based on income-level
• Discussion of contractor workforce transition
1046 of 1111
City of San Mateo
Summary of Conducted Community Engagement
24 • All commissioners supportive of the need for existing building decarbonization policies and commissioners made a motion to support all five policy pathways Attachments
Attachment 1 General Plan Town Hall Meetings Poster Board Attachment 2 In-person Feedback Meeting photos, comments, and voting board Attachment 3 Virtual Feedback Meeting Mural Board
Attachment 4 Building Performance Standard Marketing One Pager 1047 of 1111
Attachment 1
General Plan Town Hall Meetings Poster Board
1048 of 1111
City of San Mateo
Summary of Conducted Community Engagement
1-1
1049 of 1111
Attachment 2
In-person Feedback Meeting photos, comments, and voting board 1050 of 1111
City of San Mateo
Summary of Conducted Community Engagement
2-1
1051 of 1111
City of San Mateo
Summary of Conducted Community Engagement
2-2
1052 of 1111
City of San Mateo
Summary of Conducted Community Engagement
2-3
1053 of 1111
City of San Mateo
Summary of Conducted Community Engagement
2-4
1054 of 1111
Attachment 3
Virtual Feedback Meeting Mural Board, exit poll, and comments 1055 of 1111
City of San Mateo
Summary of Conducted Community Engagement
3-1
1056 of 1111
Attachment 4
Building Performance Standard Marketing One Pager
1057 of 1111
City of San Mateo
Summary of Conducted Community Engagement
4-1
1058 of 1111
City of San Mateo
City Council Meeting

POST PACKET

PUBLIC COMMENT
1059 of 1111
1 From: GTL < >
Sent: Monday, June 16, 2025 9:11 AM
To: Clerk; City Council (San Mateo)
Subject: Fw: (No Subject)
To: city clerk and all council members,
City clerk, please include this letter for public view and for public records. Thank you, Gab T. Laughlin Sent with Proton Mail secure email.
------- Forwarded Message -------
Date: On Saturday, June 14th, 2025 at 7:25 PM
Subject: (No Subject)
To: [email protected] <[email protected]>, [email protected] <[email protected]>, [email protected] <[email protected]>, [email protected] <[email protected]>, [email protected] <[email protected]>
CC:

Dear Mayor Newsom and City Council,
The following is a stock letter and I am forwarding it to you since I agree with it. Please see message below this letter for my personal thoughts in addition to this stock letter:

I am a local housing provider in your city, and I am concerned with the proposals to retrofit existing properties to all-electric systems.

Conversion to all-electric is a major capital improvement that is very costly and complex. Mandating such a change should not be taken lightly without input from property owners and operators who will bear the cost of these new requirements.

Should you continue with electrification of residential buildings, please consider the following:
• The city should make funding available to help offset costs for the retrofit. This includes building and permit fees and other expenses, such as potential loss of income during construction. • The city should give property owners the maximum time allowed to comply. • The city should not adopt additional restrictions or regulations on the rental housing market that would make the retrofit even more cost-prohibitive or enact limitations that would constrain housing providers’ control of their properties.
• The city should prioritize an incentive-based approach for phasing out natural gas appliances instead of costly, unfunded mandates.

Property owners would be placed in the impossible position of being forced to make huge upfront investments – at a time when debt service costs are high – with little more than a hope of eventual modest cost savings.

My concerns:
1060 of 1111
2 It should not be mandated to retrofit all buildings and residential houses to use only electricity and not a combination of gas and electricity.

There are not enough licensed electricians or contractors to do the job - retrofitting would be an impossible task for a home owner, housing provider and other businesses to do in a reasonable time. There is no regulations on costs an electrician would charge, and since demand would be high and supply of electricians low, there would be price gouging. The cost to retrofit older buildings would mean completely re-wiring the entire building/house. The cost would be immense and there is no justification for this - what authority does the council members have to even consider this proposal to force everyone to comply with retrofitting to go all electric? Electricity is more expense than gas. What happens to senor citizens who own their home and have to now come up with money to pay for the retrofit or complete re-wiring of their aged homes? How can on a fixed income or living off of their saving, pay for utilities when electric bill will be higher than a gas bill?
The power grid goes down, there is no backup for anything - it has happened with solar flares, too much demand for electricity as cold spells in Texas and north east US, there is a domino effect, where one power provider goes down then others will go down. An example: In 1982 high winds knocked over power lines and it had a ripple effect and took out the power from SF to San Diego and all the way to Las Vegas NV, In 1996, two major outages effecting western Canada, Idaho, Montana, Utah, New Mexico, CA, and Arizona which effected 3 million people the electricity went out due to voltage instability in the grid.

California imports electricity from Mexico and surrounding states, CA it is not self sufficient.

California is becoming a failed state because of these types of regulatory adventures.

The people that have the ability, and those that are young enough, are leaving the state and are also the people who provide income through taxes to the state, the state is biting the hand that feed it through these kinds of policies.

Gabby Tedeschi-Laughlin
1061 of 1111
-o0o- JACO PROPERTIES, LLC -o0o-
“A San Francisco Bay Area Workforce Housing Provider”
P.O. Box 570
San Mateo, CA 94401
June 16, 2025
San Mateo City Council
Mayor Rob Newsom – [email protected]
Deputy Mayor Adam Lorraine – [email protected] Councilmember Danielle Cwirko-Godycki – [email protected] Councilmember Lisa Diaz Nash – [email protected] Councilmember Nicole Fernandez – [email protected] Council Clerk – [email protected]
Re: Agenda Item 41 - “Forced All-Electric Retrofit”
Dear Mayor Newsom and City Council,
I am a local housing provider in San Mateo (we provide workforce housing in San Mateo and several other local communities on the peninsula), and I am concerned with the proposals to retrofit existing properties to all-electric systems.

Conversion to all-electric is a major capital improvement that is very costly and complex.

Mandating such a change should not be taken lightly without input from property owners and operators who will bear the cost of these new requirements.

Should you continue with electrification of residential buildings, please consider the following:
• The city should make funding available to help offset costs for the retrofit. This includes building and permit fees and other expenses, such tenant displacement payments and temporary housing as well as potential loss of income during construction. • The city should give property owners the maximum time allowed to comply. • The city should not adopt additional restrictions or regulations on the rental housing market that would make the retrofit even more cost-prohibitive or enact limitations that would constrain housing providers’ control of their properties.
• The city should prioritize an incentive-based approach for phasing out natural gas appliances instead of costly, unfunded mandates.

Property owners would be placed in the impossible position of being forced to make huge upfront investments at a time when debt service costs are high (some of our insurance premiums have increased from 350%) with little more than a hope of eventual modest cost savings.

Please do your due diligence before any final adoption of new mandates.

Sincerely,
By, Michael Johnston
For, Jaco Properties, LLC
1062 of 1111
1 From: Z. L. < >
Sent: Monday, June 16, 2025 8:00 AM
To: City Council (San Mateo)
Cc: Clerk
Subject: Recommendations for item #41, Electrify San Mateo Dear Mayor, Deputy Mayor, and Council,
Thank you for ongoing, strategic climate leadership in these very tough times. Here are my recommendations for item #41, Electrify San Mateo: Sustainable Building Strategy, on the June 16, 2025 Council agenda:

1. I support adoption of building codes that eliminate gas in new construction,

2. I strongly supportadoption of building codes that eliminate gas in retrofit construction; these codes will deliver the most significant reductions in Greenhouse Gases,

3. I strongly supportacceleration of NOx air quality standards for gas water heater and furnace replacement; these codes will also deliver the most significant reductions in Greenhouse Gases,

4. I support adoption of building performance standards for commercial buildings, and

5. I support electrification of city buildings.

I thank you for this opportunity,
Ziyi Lu
1063 of 1111
From: John McKenna
To: City Council (San Mateo)
Cc: Clerk
Subject: Agenda Item #41 - City Council Meeting 6.16.25 Date: Monday, June 16, 2025 3:57:08 PM
Dear San Mateo City Council,
I am the father of an 11-year-old daughter and I’m very concerned about her future.

Collectively, we are not acting with the urgency that the climate situation demands and deserves. The science is clear and it is well-documented that the cost of addressing the climate crisis will never be less expensive than it is right now – the longer we wait, the greater the cost and the suffering. Time is running out. We must act now to preserve a livable planet for future generations.

That being said, I want to thank the City of San Mateo for prioritizing this issue and working to put a plan in place to decarbonize. San Mateo has proven to be a leader – we need that to continue and we need more cities to follow.

I respectfully ask the City Council to please support the boldest and most meaningful versions of the pathways outlined in tonight’s presentation. We are in a "yes, and" moment. Following just one or two of these pathways will not adequately address the challenge we have before us – each of the pathways offer solutions to different problems so we need all of them, in one form or another, to be adopted in order to meet the City’s goals. While taking these actions will confront the climate crisis, it’s helpful to also highlight the co-benefits of these electrification pathways which include better local air quality, improved public health, increased safety, greater resiliency, more comfortable buildings, and lower energy costs. It’s also important to understand that there are excellent resources and financial support mechanisms in place to assist with this transition, particularly for low-income communities.

Thank you for your consideration and thank you for taking this issue seriously and acting accordingly.

Sincerely,
John McKenna
1064 of 1111
From: Elaine Salinger
To: San Mateo City Council Members
Cc: San Mateo City Council Clerk
Subject: San Mateo"s Sustainable Building Strategy
Date: Friday, June 13, 2025 10:08:36 PM
Dear Mayor, Deputy Mayor, and Council,
Thank you for your climate leadership. As the leader of Citizens Climate Lobby San Mateo County Chapter, I am speaking for over 1200 members. Here are my recommendations for item #41, Electrify San Mateo: Sustainable Building Strategy, on the June 16, 2025 Council agenda:

1. I support adoption of building codes that eliminate gas in new construction,

2. I strongly support adoption of building codes that eliminate gas in retrofit construction; these codes will deliver the most significant reductions in Greenhouse Gases,

3. I strongly support acceleration of NOx air quality standards for gas water heater and furnace replacement; these codes will also deliver the most significant reductions in Greenhouse Gases,

4. I support adoption of building performance standards for commercial buildings, and

5. I support electrification of city buildings.

Thank you and I will try to join the meeting on Monday evening.

Elaine Salinger, Group Leader
San Mateo County Chapter
1065 of 1111
1 From:

Sent: Friday, June 13, 2025 7:56 AM
To: Andrea Chow
Subject: gas/electric
The city should stay out of regulating building codes - we have enough regulations without city's getting involved.

The all electric concept may not be supported by the supply which the state controls not city's. Until the city starts generation of electrical power - the city should stay out of regulating building code requirement.

Joe Sully
1066 of 1111
From: l watanuki
To: City Council (San Mateo)
Cc: ; Martin McTaggart
Subject: Item #41 - Electrify San Mateo - Sustainable Building Strategy Policy Feed-back Date: Monday, June 16, 2025 2:12:26 PM
Dear Mayor Newsom and City Council,
I am a local housing provider in your city, and I am concerned with the proposals to retrofit existing properties to all-electric systems.

Conversion to all-electric is a major capital improvement that is very costly and complex.

Mandating such a change should not be taken lightly without input from property owners who will bear the cost of these new requirements.

Should you continue with electrification of residential buildings, please consider the following:
• The city should make funding available to help offset costs for the retrofit, including building and permit fees and other expenses, such as potential loss of income during construction.
• The city should give property owners the maximum time allowed to comply. • The city should not adopt additional restrictions or regulations on the rental housing market that would make the retrofit even more cost-prohibitive. • The city should prioritize an incentive-based approach for phasing out natural gas appliances instead of costly, unfunded mandates.

Property owners have to make huge upfront investments – at a time when debt service costs are high – with little hope of modest cost savings.

Please do your due diligence before any final adoption of new mandates.

Best,
Laurie Watanuki
1067 of 1111
1 From: William Williams
Sent: Friday, June 13, 2025 11:04 AM
To: Andrea Chow
Subject: Electrify San Mateo
Andrea:

How is a disabled 70 year old resident supposed to pay for city mandated equipment upgrades and the correspondingly higher utility charges?
Will I be expected to live without hot water?
X Bill Williams, San Mateo 6/13/25
Sent from Outlook
1068 of 1111

6.16.2025
City Council
1 1069 of 1111
Staff Recommendation
Receive an informational report on the "Electrify San Mateo: Sustainable Building Strategy" project and provide direction on the policy pathways for inclusion in the final Sustainable Building Strategy.
2 1070 of 1111
Project
Overview
1071 of 1111
Electrify San Mateo Background
• Building energy use represents 38% of San Mateo's GHG emissions • Building electrification is key in reducing fossil gas use and switching to clean carbon-free electricity provided by Peninsula Clean Energy • Co-benefits of electric buildings
4 1072 of 1111
Local Policy Context Paves the Way for Building
Decarbonization
• City of San Mateo Reach Codes
• New Construction
• City of San Mateo Policy: Climate Action
Plan (CAP)
• BE 1: All-electric new construction
• BE 2: All-electric existing buildings
• BE 2 = most significant driver of
GHG reductions
• Bay Area Air District (formerly BAAQMD)
Zero NOx Space and Water Heating
Requirements
• Zero NOx water heating by 2027
• Zero NOx space heating by 2029
5 1073 of 1111
Sustainable Buildings Strategy Goals
• Develop an actionable roadmap with
concrete steps for City of San Mateo to
electrify existing buildings
• Align approach to meet climate goals
while balancing costs and other impacts
• Use best available science and data
• Listen to the community: engage early
and often, two phases of community
outreach
6 1074 of 1111
Strategy Development Timeline
Summer 2023 Fall 2023 Winter
23-24
Spring
2025
Summer
2025
• Development of Equity
+ Effectiveness
Criteria
• Identify range of
feasible policy options
• Building Inventory and
Market Segmentation
Analysis
• Phase 1: Community
Outreach: Effectiveness +
Equity Criteria Feedback
• Results of building
inventory and market
segmentation
• Draft prioritized policies list
• Incorporation of community
feedback for equity and
effectiveness criteria
• Draft policies & pathways listCommunity feedback
• Phase 2: Outreach:

Community feedback on
policy pathways
• Incorporation of community
feedback in prioritized policy
list
• Drafting of pathway
• Upcoming Council
meeting: Sustainable
Building Strategy
adoption
7 1075 of 1111
Community Engagement
▪ Phase I
o Understand Community Values and Concerns in
following engagement:
▪ Sustainability and Infrastructure Commission meeting
▪ Five General Plan Town Hall meetings
▪ Online survey
▪ City Council meeting
▪ Phase II
o Present Five Policy Pathways, Understand Community
Concerns and Needed Support in following
engagement:
▪ One in-person and one virtual community feedback
meeting
▪ Commerical Building Performance Standard Info meeting ▪ Presentations at partner meetings and community
meetings
▪ Online survey
▪ Three Commission meetings
8 1076 of 1111
Existing Building Decarbonization Policy Types
Option 1: Business
as Usual
Option 2: Reach
Codes for
Renovations
Option 3: Zero NOx
Equipment
Requirements
Option 4:

Commercial Building
Performance
Standards
Option 5: Municipal
Electric First Policy
9 1077 of 1111
Phase II: Community Concerns
▪ Installation Cost
• Short-term investment can be high due to
unexpected repairs/ upgrades
▪ Installation and Electric Infrastructure Challenges
• Lack of space or need to upgrade electric panels
▪ On-bill Costs
• long term operational costs of electric appliances
▪ Grid Reliability
• Power outages from PSPS and increased electricity
demand could strain the grid
▪ Lack of Education
• Need for a "help-desk" and peer-to-peer coaching
10 1078 of 1111
On-Bill Cost Impacts
▪ Water heaters and
HVAC save money on
bill with PCE.
▪ Rate choice is important
(choose e-elec).
▪ Gas rates expected to
increase faster than
electricity rates over
time.
11 1079 of 1111
Educational Resources
▪ Under each policy the City would expand engagement and direct the community to robust resources
▪ PCE "Concierge Service” “https://www.peninsulacleanenergy.com/residential/home-upgrade-services/ 12 1080 of 1111
Existing Building
Electrification
Policy Pathways
1081 of 1111
Option 1: Business as Usual
• Continue to adopt new construction "reach codes"
(ordinances that surpass the state's buildings code) to require more sustainable new buildings than the state
code; AB 306 impacts
• Focus on education, outreach, and incentives for
existing buildings
• Current incentives: Peninsula Clean Energy,
Inflation Reduction Act, and California TECH
$(7,500) savings
compared to
mixed-fuel
$0 (pre-wiring
required
by code)
~1,070 MT CO2e/yr by
2030 if all new buildings
had no natural gas
14 1082 of 1111
Option 1: Business As Usual
Community Engagement
Engagement Event
Online Survey
In-Person Community Feedback Meeting
Virtual Community Feedback Meeting
San Mateo United Homeowners Association Feedback Meeting Senior Advisory Commission
Sustainability and Infrastructure Commission
Community Relations Commission
Level of Support
Highly
Favorable
Favorable
Polarized
Unfavorable
Highly
Unfavorable
15 1083 of 1111
Option 2: Reach Codes for Renovations – AC to HP
• Requires new air conditioning units to
provide heating and cooling; AB 306
impacts
• Heat pump is cost parity or up to
$1,500 more than traditional AC
• PCE has a $1,500 rebate
• Avoids cost of furnace under future
BAAD rules ($10,000+)
$0 to $(1,500) savings
compared to AC
$0 (same as AC)
~2,200 MT CO2e/yr
by 2030
16 1084 of 1111
Option 2: Reach Codes for Renovations – Flex
• Required for large retrofits (e.g. $75,000+)
• Flexible options (pick one)
• Electrification + Efficiency Options
• All required to save money over lifetime
Variable but usually
$2,000 to $4,000
$0 (non-electric options)
~730 MT CO2e/yr
by 2030
17 1085 of 1111
Option 2 Reach Codes for Renovations
Community Engagement
Engagement Event
Online Survey
In-Person Community Feedback Meeting
Virtual Community Feedback Meeting
San Mateo United Homeowners Association Feedback Meeting Senior Advisory Commission
Sustainability and Infrastructure Commission
Community Relations Commission
Level of Support
Highly
Favorable
Favorable
Polarized
Unfavorable
Highly
Unfavorable
18 1086 of 1111
Option 3: Zero NOx Equipment Requirements
• The Bay Area Air District (BAAD) will
require property owners in nine Bay
Area counties, including San Mateo,
to switch their water heaters
(starting in 2027) and space heating
equipment (starting in 2029) to
electric when they need to be
replaced
• This proposed policy would move
up the deadline so that this
requirement would be in effect in
ahead of BAAD’s requirements ~9,700 MT
CO2e/yr by 2030
19 1087 of 1111
Costs: Residential Upfront Water
Heating Electrification Costs
$2,500
Heat Pump Water Heater $6,000
Minus PCE Rebate
Minus Fed. Tax Credit $2,000
Cost of HPWH - Rebates $1,500
Cost of Gas Water Heater $2,800
Water
heating
$(1,300) savings
compared to gas
$3,500 for panel
if needed
20 1088 of 1111
Costs: Residential Upfront HVAC
Electrification Costs
Space heating
$1,500
Heat Pump $17,910
Minus PCE Rebate
Minus Fed. Tax Credit $2,000
Cost of HP - Rebates $14,410
Cost of Furnace and AC $13,632
Cost of Furnace $6,132
$8,278 to $778 compared
to gas (depends if AC is
added)
$3,500 for panel
if needed
21 1089 of 1111
Option 3 Zero Nox Equipment Requirements
Community Engagement
Engagement Event
Online Survey
In-Person Community Feedback Meeting
Virtual Community Feedback Meeting
San Mateo United Homeowners Association Feedback Meeting Senior Advisory Commission
Sustainability and Infrastructure Commission
Community Relations Commission
Level of Support
Highly
Favorable
Favorable
Polarized
Unfavorable
Highly
Unfavorable
22 1090 of 1111
Year 1-2: Benchmark
Annually Report MT
CO2e and square
footage
Year 2-4: Retrocommission Engineering
report on energy saving
opportunities
Year 4+: Performance Standard
Complete projects to reach the
threshold (GHG reduction/ SF)
Option 4: Commercial Building Performance Standards
• Adopt a policy standard for commercial buildings over a specific square footage (ex: 20,000 SF; 50,000 already mandated by AB 802) • Policy would require disclosing building energy use, increasing energy efficiency, and eventually, electrifying buildings as a phased approach $3,000 $0.30/SF Variable
Variable
Less than
~83,660 MT
CO2e/yr by
2045
23 1091 of 1111
Option 4 Commercial Building Performance Standards
Community Engagement
Engagement Event Consensus
Online Survey
In-Person Community Feedback Meeting
Virtual Community Feedback Meeting
San Mateo United Homeowners Association Feedback Meeting Commercial Building Performance Standard Information Session Senior Advisory Commission
Sustainability and Infrastructure Commission
Community Relations Commission
Level of Support
Highly
Favorable
Favorable
Polarized
Unfavorable
Highly
Unfavorable
24 1092 of 1111
Community Engagement
• Advertised event with BPS information 1-pager
• Building owners had the following suggestions and
concerns:
▪ Desire for an individual threshold where buildings must reduce their emissions compared to their own historical emissions rather than meet a City or building type
average.
▪ Desire for a vintage threshold, exempting newer buildings that are already well- performing
▪ Concerns regarding space issues and complicated tenant and lease structures
25 1093 of 1111
Option 5: Municipal Electric First Policy
• Require City facilities to transition to electric equipment upon replacement
• Provides exemptions for infeasible projects
~145 MT CO2e/yr
by 2030
26 1094 of 1111
Option 5 Municipal Electric First Policy
Community Engagement
Engagement Event Consensus
Online Survey
In-Person Community Feedback Meeting
Virtual Community Feedback Meeting
San Mateo United Homeowners Association Feedback Meeting Senior Advisory Commission
Sustainability and Infrastructure Commission
Community Relations Commission
Level of Support
Highly
Favorable
Favorable
Polarized
Unfavorable
Highly
Unfavorable
27 1095 of 1111
Staff Recommendation
Receive an informational report on the "Electrify San Mateo: Sustainable Building Strategy" project and provide direction on the policy pathways for inclusion in the final Sustainable Building Strategy.
28 1096 of 1111
Existing buildings
making improvements
~1,070 MT CO2e
per year by 2030
HP: ~ 2,200 and Flex
Path: ~ 730 MT CO2e
per year by 2030
~9,700 MT CO2e
per year by 2030
Less than ~83,660
MT CO2e per year
by 2045
~145 MT CO2e per
year by 2030
Cost saving to not install
natural gas infrastructure
HP: savings/no cost differential w/rebates
Flex path: cost-efficient options; savings
over time but upfront costs
Time of replacement usually
cost-effective but high upfront
costs in some scenarios
Cost-efficiency due to flexible
path & phased implementation;
Equity considerations in MF
Exceptions for highcost scenarios
Highly Favorable
Favorable/
Polarized
Unfavorable
Favorable
Highly Favorable
29 1097 of 1111
1 1
San Mateo City Council
June 16, 2025
1098 of 1111
Who We Are…
• San Mateo Climate Action Team
• Aligned with 350 Silicon Valley
• Seniors and youth, and just ordinary
people
2 1099 of 1111
We Are Running Out of Time!!
Intergovernmental Panel on Climate Change: World can emit GHG at current rate for only 5 years before Inflection Point! 3 1100 of 1111
⮚ San Mateo is a national leader, through
hard work, and City Leadership
⮚Peninsula Clean Energy provides clean
electrical energy and can handle future
loads.
⮚PCE offers a wider range than ever, of
assistance to income qualified, and
market rate customers.
⮚The cost of electrical installation is
approaching parity with gas
replacements.

CLIMATE ACTION IN OUR COMMUNITY
4 1101 of 1111
5 We Support All 5 Options in the
Decarbonization Study

1. BAU: Reach Codes for New Construction

2. Reach Codes for Renovations

3. Accelerated nitrous oxides (NOx) standards

4. Building Performance Standards - Commercial Buildings

5. Electric First Policy for City Buildings
1102 of 1111
Programs from PCE
• Gas equipment fails - Be Prepared!
• Direct install of all new electric
equipment to replace gas – free to
income qualified
• One stop concierge service to provide
support and coaching
• Emergency hot water heaters
6 1103 of 1111
7 1104 of 1111
Electrification Costs* At Parity With Gas!
• Heat pump water heater
• Sample size: 1,499 PCE projects Jan ‘21 to Apr 2025
• HPWH cost after rebates and tax credits $ 2,533
• Typical gas water heater replacement (tank): $ 2,500 - $ 3,500 • Typical gas water heater replacement (tankless): $ 5,200 • Heat pump HVAC
• Sample size: 1,691 PCE projects Oct ‘22 to Apr 2025
• Heat Pump HVAC cost after rebates & tax credits: $13,800 • Typical gas furnace replacement with AC $16,000
• Typical gas furnace replacement w/o AC $ 6,800
*Not including electrical upgrades
8 1105 of 1111
Free electric appliances
• Eligibility: incomequalified homeowner
• Free electric appliances
+ minor home repairs
1106 of 1111
Free electric appliances
1107 of 1111
11 For renters

1.EVs and EBikes

2.Portable heat pumps, 110 Volts, transportable

3.Portable induction cooktops, 110 Volts, transportable

4.Assistance with utility bill payments

5.EV multi family charging stations thru PCE
1108 of 1111
BAY AREA AIR DISTRICT RULES 9.4 AND 9.6
● Bay Area Air District has adopted rules under the Clean Air Act, that prevent replacing gas water heaters with gas, and gas furnaces with gas, effective January 1, 2027, and 2029
● Air District has NOT asked for inclusion in the State Implementation Plan, for concern about being disallowed under the current Administration
● South Coast Air Quality Management District (SCAQMD) had taken a “market” approach, but has now rejected that
approach.
1109 of 1111
Assembly Bill 306 - THE END OF REACH CODES
● Places 6 year “temporary” moratorium on new Reach Codes - including AC2HP, and Retrofits; effective June 1, 2025 October 1, 2025, and only if following a building code other than the normal state process
● Ostensibly for the purpose of speeding housing rebuild in Los Angeles, after fires
● This is an Assembly Speaker Bill
1110 of 1111
14 1

THANK YOU
1111 of 1111