City Council Staff Report Page 1 of 3 February 10, 2026 Staff Report
Agenda Item No. 5.1
DATE: February 10, 2026
TO: Honorable Mayor and Members of the City Council
FROM: Joan Malloy, City Manager
SUBJECT: Underwriting Options for Sidewalk Repair Costs, Annual Sidewalk, Curb and Gutter, and Ramp Repair Project, City Project No. 25-03
EXECUTIVE SUMMARY
At the December 16, 2025, City Council meeting, the City Council directed staff to explore options that would further underwrite the sidewalk repair costs to reduce the property owners’ contribution to the Annual Sidewalk, Curb and Gutter, and Ramp Repair Project, City Project No. 25-03. Staff is presenting three options for the City Council’s consideration. The City Council could select one of the three alternatives, identify a fourth alternative, or make no changes to the formula for cost recovery for the sidewalk repair program. Any alternative will require staff to return to the City Council for formal action.
STRATEGIC PLAN ALIGNMENT
This agenda item is aligned with the following:
Goal D, Strategy 2: Environmental Sustainability and Infrastructure – Implement the City’s capital improvement plan.
BACKGROUND
Under the State Streets and Highways Code Section 5610, the owners of lots that front a public street are responsible for the maintenance of the public sidewalk. This responsibility is reflected in the Union City Municipal Code, Section 12.08.615.
Historically, the City has sponsored a sidewalk repair and replacement program and shared repair costs with property owners. The City pays for mobilization, curb and gutter repair, and tree removal (if necessary). The property owners pay for the demolition of the old sidewalk, site preparation, and the concrete for the new sidewalk. The City funds the project up front and seeks reimbursement from property owners for their sidewalk repair costs after project closeout. Repayment options of up to 12 months are typically offered.
Any outstanding balances at the end of the repayment period are subject to a lien being placed on the property.
Most recently, on August 12, 2025, the City Council adopted Resolution No. 2025-116, Agenda Item No. 5.1
City Council Staff Report Page 2 of 3 February 10, 2026 awarding a construction contract to Rosas Brothers Construction in the amount of $539,954 and approving a total construction budget, including contingency, of $647,945 for the Annual Sidewalk, Curb and Gutter, and Ramp Repair Project, City Project No. 25-
03. The Capital Improvement Plan (CIP) budget was $700,000, so the construction budget was well within the planned expenditures
On December 16, 2025, the City Council adopted Resolution No. 2025-173 accepting completion of the Annual Sidewalk, Curb and Gutter, and Ramp Repair Project, City Project No. 25-03. The final construction cost was $611,523, $36,422 below the construction budget and $88,477 below the CIP budget.
For City Project No. 25-03, total City costs are $333,177, and the property owners' share is $278,346. Although the project was initially funded using 100% City funds — including State Gas Tax, Road Maintenance & Rehabilitation, and Measure BB funds — the reimbursements collected from property owners would be used to support future CIP projects. Future projects may include, but are not limited to, future sidewalk repairs, bike lane improvements, and pavement projects.
Due to the unprecedented economic environment and rising material and labor costs, the project costs were approximately 75% higher than those of the most recently completed sidewalk repair project in 2022. At the December 16, 2025, City Council meeting, staff recommended that the remaining project balance of $36,422 be used to offset the property owners’ sidewalk repair costs on a proportional basis. City Council directed staff to explore additional underwriting options, beyond the $36,422 remaining balance, including a 50% underwriting option for the property owners’ sidewalk repair costs.
Additionally, at the December 2025 meeting, staff recommended extending the repayment period from 12 to 18 months to reduce property owners’ monthly payments.
DISCUSSION
Per the City Council’s direction, City staff explored three different options to underwrite the property owners’ sidewalk repair costs. The first option uses the remaining construction budget of $36,422, which would provide a 13% discount. The second option uses the remaining CIP budget for Fiscal Year 2025-2026 of $88,477, which would provide a 31.5% discount. The third option explores a 50% discount as requested by the City Council.
The table below compares the different discount options for the property owners. Option 1 (13% discount) and Option 2 (31.5% discount) do not require additional funds to be appropriated. Option 3, the 50% discount, will require an additional $50,696 in City Council appropriation, as the total underwriting amount exceeds the CIP budget for Fiscal Year 2025-2026. Option 3 would require redirecting transportation funds from other CIP projects.
Agenda Item No. 5.1
City Council Staff Report Page 2 of 3 February 10, 2026 Agenda Item No. 5.1
City Council Staff Report Page 3 of 3 February 10, 2026 Current Option 1 Option 2 Option 3
Discount 0% 13% 31.5% 50%
Underwrite Amount -- $36,000 $87,500 $139,173
Median Cost per property owner $2,025 $1,762 $1,387 $1,012 Highest Cost $8,302 $7,223 $5,687 $4,151
Lowest Cost $480 $418 $329 $240
FISCAL IMPACT
The Annual Sidewalk, Curb and Gutter, and Ramp Repair Project, City Project No. 25- 03, was funded by a combination of State Gas Tax funds (Fund 250), SB 1 Road Maintenance & Rehabilitation funds (Fund 251), and Measure BB Bike & Pedestrian funds (Fund 267), for a total of $611,523. The Fiscal Year 2025-2026 CIP budget allocated $700,000 for this project, which was sufficient to cover the construction costs upfront. The property owners’ shared costs, estimated at $278,345, are collected after the project closeout.
Options 1 through 3 would reduce the amount of shared costs collected from the property owners and would correspondingly increase the City’s portion of the total project costs.
Options 1 and 2 utilize the construction budget and CIP budget savings, respectively.
However, these savings would typically be returned to the fund balance and redirected to future transportation CIP projects. Option 3 would similarly redirect the budget savings and appropriate an additional $50,696 that would otherwise be available to fund other CIP transportation projects.
RECOMMENDATION
Staff recommends that the City Council receive the presentation and provide direction regarding the three underwriting options for property owners’ sidewalk repair costs. The City Council could select one of the three alternatives, identify a fourth alternative, or make no changes to the formula for cost recovery for the sidewalk repair program, Annual Sidewalk, Curb and Gutter, and Ramp Repair Project, City Project No. 25-03.
Prepared by: Diana Cangco, City Engineer
Submitted by: Marilou Ayupan, Public Works Director
Attachments
1. PowerPoint Presentation