City Council
Report
City Council Meeting: September 22, 2026
Agenda Item: 4.J
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To: Mayor and City Council
From: Oscar Santiago, Director, Finance Department, Revenue Subject: Approval of Third Modification to Agreement No. 9756 (CCS) with HdL Software, LLC for Business License Software for the Finance Department Recommended Action
Staff recommends that the City Council:
1. Adopt a finding of no possibility of significant effect pursuant to Section 15061(b)(3) (Common Sense Exemption) of the California Environmental Quality Act (CEQA) Guidelines; and
2. Authorize the City Manager to execute a third modification to agreement #9756 (CCS) in the amount of $83,500 with HdL Software, LLC (“HdL”) for business license software services for the Finance Department. This will result in a 15-year amended agreement with a new total amount not to exceed $552,572, with future year funding contingent on Council budget approval.
Executive Summary
The City currently uses the HdL software system to administer the billing and collection of business license taxes as well as certain assessments, fees, and regulatory permits.
Staff seeks Council approval to extend the existing software contract to maintain uninterrupted operations of HdL Prime, the City’s system of record for business licensing, tax collection, compliance workflows, and reporting. Staff recommends executing a third modification to extend agreement #9756 for one year, with two sixmonth renewal options, and increase the contract amount by $83,500 for a new total amount not to exceed $552,572. The extension is needed to maintain service continuity, while the competitive solicitation via RFP #468 that is currently in evaluation is 2 of 4
completed. This extension is approved via ECB #507 by the Acting Procurement Manager.
Discussion
The Finance Department uses HdL software to administer approximately 24,000 business license accounts and collect $41 million annually in tax revenue, assessments, and fees. Extending the City’s contract with HdL is required to ensure uninterrupted service of the current system until the competitive process in progress is completed.
The evaluation committee is currently reviewing software proposals and conducting demonstrations to evaluate functionality, compliance features, system reliability, and integration capabilities. As part of this process, staff will also ensure the selected solution aligns with the City’s operational, technical, and financial requirements. Staff anticipates completing evaluations, negotiations, and recommended vendor award by November 2026. Following selection, staff will return to City Council for contract approval, immediately followed by system implementation.
Environmental Review
The proposed recommendation to modify the contract to HdL is exempt from the provision of the California Environmental Quality Act (CEQA) pursuant to Section 15061(b)(3) of the CEQA Guidelines (common sense exemption). The proposal is covered by the common sense exemption 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 contract would not result in any adverse physical environmental effects as it encompasses software services. The software services are administrative in nature and would not have a physical effect on the environment, so therefore, are exempt from CEQA. Therefore, the modification to the agreement is exempt from CEQA and no further environmental review under CEQA is required.
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Past Council Actions
Meeting Date Description
6/25/2013 (Weblink)
Authorize agreement with HdL for business license software maintenance and support services
10/23/2018 (Weblink)
Approval of First Modification to Agreement No. 9756 (CCS) for Business License Software Maintenance and Support Services and Software Development Services
9/26/2023 (Weblink)
Approval of Second Modification to Agreement No. 9756 (CCS) with HdL Software, LLC for business license software
Financial Impacts and Budget Actions
Staff seeks authority to approve available funding from the General Fund to increase the amount of agreement #9756 with HDL for Business License Software services.
Contract Modification Request
Agreement #
Current
Authorized
Amount
FY 2026-27
Modified Request
Amount
Future
Years
Amount
Dept/CIP Account
#
Total Revised
Contract
Amount
9756 $469,072 $41,500 $42,000 01300005.529230 $552,572
Future year funding is contingent on Council budget approval.
Prepared By: Haley Favre-Smith, Business and Revenue Operations Manager Approved Forwarded to Council
Attachments:
A. Attachment A - HdL Software, LLC - Agreement #9756 CCS 4 of 4
B. Attachment B - HdL Software, LLC - First Modification to Contract #9756 C. Attachment C - HdL Software, LLC - Second Modification to Contract #9756 D. Attachment D - HdL Software, LLC - FY 2026-27 OAKS Form E. Attachment E - HdL Software, LLC - 2026 Levine Act Form