City Council
Report
City Council Meeting: June 24, 2025
Agenda Item: 4.B
1 of 4
To: Mayor and City Council
From: Dana Brown, Human Resources Director, Human Resources Department Subject: Approval of Modification of Agreement with PACIFIC HARBOR MEDICAL GROUP INC. for Occupational Medical Testing Program Services Recommended Action
Staff recommends that the City Council
1. Adopt a finding of no significant effect pursuant to Section 15061(b)(3) of the California Environmental Quality Act (CEQA) Guidelines;
2. Authorize the City Manager to negotiate and execute a first modification to agreement #3940 in the amount of $136,850 with Pacific Harbor Medical Group Inc. for occupational medical testing services for the Human Resources Department. This will result in 17-month amended agreement with a new total amount not to exceed $231,850, with future year funding contingent on Council budget approval.
2 of 4
Executive Summary
Pacific Harbor Medical Group Inc. provides Occupational Medical Testing Program (OMTP) services for employees and new hires. Staff recommends extending the contract for an additional six months through December 31, 2025, to allow for additional time to complete an RFP process and award contracts for future OMTP services.
Background
Pacific Harbor Medical Group Inc. provides Occupational Medical Testing Program (OMTP) services to protect employees from on-the-job health and safety risks through physicals, testing, and preventative health measures.
The Human Resources Department manages the OMTP with assistance from operating departments and relies on private medical providers to carry out the testing required by the program. To comply with state and federal regulations, the City is required to provide employees in certain classifications with the following services: commercial driver medical examinations, POST (Peace Officer Standards and Training Program) medical examinations, hazmat physicals, tuberculosis screenings, respirator medical clearance, and various vaccinations. In addition, as part of the OMTP program, all job candidates offered employment in physically demanding positions undergo a preemployment physical exam.
In June 2023, the City entered a five-year contract with Westchester Medical Group following the administration of an RFP process. Westchester Medical Group had been the City’s OMTP provider since 2009. Westchester Medical Group shuttered its operations in February 2024 without providing the City with sufficient advanced notification which required the City to quickly retain services from another provider. On June 3, 2024, the Human Resources Department received authority approval for an exception to the competitive bidding process and awarded Pacific Harbor Medical Group Inc. a contract to provide critical preemployment OMTP services for an amount not to exceed $95,000. The City reached the $95,000 limit earlier than anticipated due to an unforeseen increase in the need for such services. 3 of 4
Discussion
The Human Resources Department recommends a modification to the agreement #3940 in the amount not to exceed $231,850 which provides for an additional $136,850 in funds to be used through the end of the calendar year. The estimated additional expenditure is based on past monthly cost experience with the highest monthly spend at $17,000 and adding a 15% contingency. The proposed amendment would result in a new total contract amount not to exceed $231,850 and would extend the contract term for six months through December 31, 2025, to allow for additional time to complete RFP process and award associated contracts.
Past Council Actions:
There are no past council items.
Environmental Review
The agreement for ongoing occupational medical testing program services is exempt pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines, which states that CEQA does not apply, where it can be seen with certainty that there is no possibility that the activity in question may have a significant effect on the environment. The agreement would provide medical examination services and would not result in physical effects. Therefore, it can be seen with certainty that the contract would not result in adverse physical impacts on the environment, and as such, is exempt from CEQA.
Financial Impacts and Budget Actions
Staff seeks authority to approve available funding from the 74800002.552010 account number to increase the amount of the contract with Pacific Harbor Medical Group.
FY 2025-26 Contract Modification Request
4 of 4
Agreement
#
Current
Authorized
Amount
Modified
Request Amount
Future
Year
Modified
Request
Amount
Dept Account # Total
Revised
Contract
Amount
3940 $95,000 $136,850 $0 74800002.552010 $231,850
Future year funding is contingent on Council budget approval.
Prepared By: Sasha Sargent, Executive Administrative Assistant Approved Forwarded to Council
Attachments:
A. SM Oaks Initiative 2025
B. SM Levine Act Disclosure 2025
C. FY24-25 Living Wage