CITY OF SAN MATEO
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CITY OF SAN MATEO
Agenda Report
City Hall
330 W. 20th Avenue
San Mateo CA 94403
www.cityofsanmateo.org
Agenda Number: 11 Section Name: CONSENT CALENDAR Account Number: 88-1712 File ID: 26-11176 TO: City Council
FROM: Alex Khojikian, City Manager
PREPARED BY: City Attorney's Office
MEETING DATE: May 04, 2026
SUBJECT:
Comprehensive Liability Fund — Appropriation
RECOMMENDATION:
Adopt a Resolution approving a supplemental budget appropriation of $1,100,000 of unassigned fund balance from the General Fund and the Construction Services Fund to increase transfers out to the Comprehensive Liability Fund (Fund 880) to increase the budget for legal costs.
BACKGROUND:
The adopted budget for Fiscal Year (FY) 2025-26 includes $5,183,430 for the Comprehensive Liability Fund. This fund is used for insurance premiums, litigation expenses, claims management and payments, and other legal and professional services. The largest single component of this fund are insurance premiums, which have dramatically increased of late.
However, the City has also seen significant increases in litigation costs, which have been primarily driven by substantial demands from plaintiffs. These in turn are influenced by large jury verdicts that can discourage low dollar value settlements and, in some cases, drive up litigation costs. This situation is not unique to San Mateo, as local jurisdictions around the state are experiencing the same legal and financial pressures. Thus, in order to appropriately plan for such expenses, staff recommends an appropriation of $1.1 million of unassigned fund balance from the General Fund and the Construction Services Fund to increase transfers out to the Comprehensive Liability Fund. Staff will monitor whether an additional increase will be needed for Fiscal Year 2025-26 as it manages legal expenses for the remainder of this fiscal year.
BUDGET IMPACT:
An appropriation of $1,100,000 of unassigned fund balance from the General Fund (Fund 100 - $880,000) and the Construction Services Fund (Fund 230 - $220,000) to increase transfers out to the Comprehensive Liability Fund (Fund 880) which will result in a new budget appropriation in Fund 880 of $6,283,430 for Fiscal Year 2025-26. There is sufficient unassigned fund balance in the foregoing funds for this appropriation.
ENVIRONMENTAL DETERMINATION:
This Resolution is not a project subject to CEQA, because it is an organizational or administrative activity that will not result in direct or indirect physical changes in the environment. (CEQA Guidelines Section 15378(b)(5).)
NOTICE PROVIDED
All meeting noticing requirements were met.
ATTACHMENTS
Att 1 – Proposed Resolution
CITY OF SAN MATEO
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STAFF CONTACT
Prasanna Rasiah, City Attorney
[email protected]
(650) 522-7020