J A N U A R Y 3 0 , 2 0 2 5
CITY OF VALLEJO
Presentation of General Fund Debt & Considerations
for Developing a Funding and Financing Plan
City Council Meeting | January 27, 2026
1 Recommendations
▪ Approve City staff and KNN reaching out to U.S. Bank (formally UBOC) to discuss renegotiating the release of City assets currently leased under the Master Lease Agreement
▪ Look into next steps regarding financing a Police HQ and other large-scale CIPs within the constrained amount dictated by the UBOC agreement
FINANCING CIPS
CONSTRAINED
AMOUNT:
✓ $169,100,000 ✓ UBOC cap on debt service (10% of GF
Revenues)
Vallejo Has Issued Various Forms of Debt
to Finance Infrastructure Projects
2 ▪ Vallejo’s outstanding debt primarily falls into two main categories:
▪ Governmental activities: debt related to general infrastructure projects ▪ Business-type activities: debt in this category is self-supporting and generally tied to enterprise funds or departments
REPAYMENT SOURCE TYPE OF BORROWING / DEBT VOTER-
APPROVED?
PAID FROM
GENERAL FUND
✓ Lease Revenue Bonds/Certificates of Participation
(COPs)
✓ Vallejo has outstanding COPs and Loans
No
PAID FROM SPECIAL
FUND REVENUES
✓ Enterprise Revenue Bonds
✓ Vallejo has outstanding Water Revenue
Bonds and Loans
No
OTHER TYPES OF BORROWINGS ISSUED BY PUBLIC AGENCIES
PAID FROM TAXES ▪ General Obligation Bonds (GO Bonds)
▪ Limited Tax (Special Sales Tax) Bonds
▪ Special Tax Bonds
▪ Special Assessment Bonds
Yes
OUTSTANDING ANNUAL
BALANCE DEBT SERVICE FINAL INTEREST TYPE OF
as of 6-30-25 as of 6-30-25 MATURITY RATE FINANCING
1999 Cerficates of Participation $1,466,517 $313,357 7/15/2029 5.250% Public Offering UBOC Loan1 - Tranche A 262,804 786,102 1/1/2026 2.500% Bank Loan UBOC Loan1 - Tranche B 23,228,541 912,564 1/1/2042 1.625% Bank Loan Motorola Equipment Lease - Police 898,367 462,500 6/1/2027 -- Vendor Loan Bank of America Loan - Fleet 3,535,000 832,607 6/1/2032 -- Bank Loan SUBTOTAL LEASE DEBT $29,391,229 $3,307,130
Other Lease Payments (includding SBITAs) 815,000
TOTAL LEASE DEBT $4,122,130
1. UBOC Loan amounts include General Fund, Golf Course, and Marina portions reported in both governmental and business type actvities in the City's ACFR. The repayment of the UBOC Loan is an obligation of the general fund.
Outstanding Vallejo General Fund
Supported Debt
3 ▪ The City has approximately $30 million of principal amount of debt outstanding supported by the general fund
▪ 80% of outstanding Vallejo General Fund debt relates to the City’s loan with U.S. Bank (formally Union Bank of California or the UBOC Loan)
4 The UBOC Loan
TAX-EXEMPT A-RATED PUBLIC MARKET YIELDS
VS. UBOC LOAN RATE
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
4.50%
A-Rated Lease Debt UBOC Loan Borrowing Rate (1.625%)
▪ Put into place in 2011 as part of the
bankruptcy plan
▪ Restructured the City’s prior
outstanding Certificates of Participation
debt
▪ Series 2000, 2001, 2002, & 2003
▪ Tranche A – No Longer Outstanding
▪ Original Principal: $18.1M
▪ Maturity Date: 01/01/2026
▪ Interest Rate: 2.500%
▪ Tranche B – Currently Outstanding
▪ Outstanding Principal: $23.2M
▪ Maturity Date: 01/01/2042
▪ Interest Rate: 1.625%
1. Assumes December 2025 market conditions and pricing yields for A-rated lease credits. 1 5
UBOC Loan Agreement:
Leased Asset Constraint
▪ All of the assets that were subject to the restructured Certificates of Participation debt were leased under the UBOC Loan Agreement
OUTSTANDING UBOC LOAN LEASED PROPERTY
2000 COP Assets: 2001 COP Assets1:
Office Building (400 Mare Island Way)
2002 & 2003 COP Assets:
Notes:
1. Asset substitution executed in 2023.
City Hall (555 Santa Clara St.)
John F. Kennedy Library (505 Santa Clara St.)
Corp. Yard (excluding Police) (111 Amador St.)
Florence Douglas Senior Center (333 Amador St.)
Naval Museum (734 Marin St.)
Community Center (401 Amador St.)
So. Vallejo Community Center (545 Magazine St.)
Transit Yard (VCTC Facility) (1850 Broadway St.)
Ball Field (APN: 0056-156-010 and 0056-156-030)
Vacant land at various APNs:
APN: 0079-220-070; APN: 0182-060-030; APN: 0182-060-
040; APN: 0182-060-430; APN: 0182-280-420 and 0182-280- 430; APN: 0182-280-120; APN: 0079-340-020; APN: 0079-
330-290
▪ The City also has various properties that are subject to the lease that secures the 1999 Certificates of Participation
Police Headquarters (111 Amador)
Fire Station #1 (1200 Marin Street)
Fire Station #3 (900 Redwood Street)
Fire Station #4 (1005 Oakwood Avenue)
Fire Station #6 (1335 Fulton Avenue)
Fire Station #6 (1335 Fulton Avenue)
OUTSTANDING 1999 COPS LEASED PROPERTY
6 UBOC Loan Agreement:
Leased Asset Constraint
▪ The Leased Property subject to the UBOC Loan can be released in the following ways:
1. Negotiation with UBOC: Use the maturity of Tranche A as rationale for the partial release of certain of the assets that comprise the Leased Property
2. Refinance the UBOC Loan: Refinance the UBOC Loan with another form of borrowing and eliminate the related loan constraints
TRUE INTERST
COST1
AVERAGE ANNUAL
DEBT SERVICE2
TOTAL
DEBT SERVICE 2
PRESENT VALUE COST
VS. STATUS QUO2
UBOC LOAN vs. CURRENT MARKET
UBOC Loan "Status Quo": 1.625% $1,572,723 $25,163,569 - Current Market Results: 3.235% $1,788,422 $28,614,744
Difference from "Status Quo" 1.610% $215,698 $3,451,175 $2,850,882 SENSITIVITY SCENARIOS:
1. TIC based on December 2025 market conditions and pricing yields assuming an A-rated lease credit and the use of AA bond insurance.
2. Total debt service and PV costs for each scenario assume interest costs, cost of issuance of $400k, estimated bond insurance and reserve fund surety premiums, and underwriter's fees at $4/bond.
Note: If the City does not have available assets to support the issuance of additional lease debt, it could use the financed “Project” as the “Leased Property”. This would require capitalizing interest on the borrowing, which involves additional cost. 7 ▪ “…the City may not create, issue, incur, assume, or otherwise become obligated in respect of, or permit to be outstanding, or suffer to exist, any Debt in addition to the Debt of the City outstanding, existing, or under which it is obligated that would cause the Maximum Annual Debt Service to exceed 10% of the general fund revenues…”
UBOC Loan Agreement:
Additional Debt Constraint
Note: the UBOC Loan borrowing constraint is only a true limitation to the extent Vallejo has the budgetary capacity to finance a project that exceeds $11 million in annual debt service.
UBOC LOAN ADDITIONAL DEBT CONSTRAINT (FY 2024-25)
FY 2024-25 General Fund Revenues (including Measure P) $152,000,000 UBOC Debt Constraint (10% of GF Revenues) 15,200,000
Less: Existing Maximum Annual Debt Service 4,200,000
Annual Debt Service Additional Capacity $11,000,000
Available Additional Bonding Capacity1 $169,100,000
1. Assumes additional annual debt service capacity for a 30-year term at a 5% interest rate. Borrowing proceeds under the bonding capacity amount available for project construction would be net of issuance costs and any capitalized interest or debt service reserve funds financed through the borrowing.
8 $0
$4
$8
$12
$16
$20
$24Millions
Existing General Fund Lease D/S
UBOC Loan Maximum Debt Constraint
General Fund + Measure P Resources
▪ Available debt service capacity under the UBOC Loan
▪ Estimated Additional Bonding Capacity1: $169M
ADDITIONAL ANNUAL LEASE DEBT SERVICE CAPACITY
▪ Additional debt service capacity if Measure P is
maximized but extends beyond the UBOC Loan constraint
▪ Estimated Additional Bonding Capacity1: $277M
UBOC Loan Agreement:
Additional Debt Constraint
1. Assumes additional annual debt service capacity for a 30-year term at a 5% interest rate. Borrowing proceeds under the bonding capacity amount available for project construction would be net of issuance costs and any capitalized interest or debt service reserve funds financed through the borrowing.
9 UBOC Loan Alternatives
KEEP LOAN OUTSTANDING
PRO:
▪ Maintain low fixed interest rate on
Tranche B loan repayment –
1.625%
▪ Negotiate Property release as
provided under the terms of the
Master Lease
▪ Eliminates covenants and
requirements under the Master
Lease & Reimbursement
Agreement
▪ All Leased Property released and
free and clear for asset/property
sale or to support future lease
issuances
CON:
▪ Bound by covenants and
requirements under the Master
Lease & Reimbursement
Agreement
▪ Leased Asset and Borrowing
Capacity constraints
▪ Under December 2025 market
conditions, refinancing of the
Tranche B loan with public market
Certificates of Participation
increases the City’s borrowing
cost – estimated at $2.85M PV
cost
REFINANCE LOAN
10 ▪ Prioritize projects from CIP – i.e., high, medium, and low
▪ Develop Cash Flow Model for priority projects over
selected time – i.e., 5, 7, or 10 years
▪ Estimate amount and timing of annual capital
expenditures
▪ Identify available funding – cash, loans, grants,
sale of assets, etc.
▪ Identify amount and timing of “unfunded” or
borrowing need
▪ Prepare pro forma debt service numbers and evaluate
debt affordability and capacity
▪ Budgetary capacity
▪ UBOC Loan capacity (if still outstanding)
▪ For lease financings, identify available assets and/or the need for capitalized interest
1. IDENTIFY PROJECT
PRIORITIES AND NEEDS
ASSESSMENT
2. DEVELOP & ANALYZE
FINANCIAL AND CASH FLOW
MODEL
3. BORROWING
ALTERNATIVES AND DEBT
CAPACITY
Capital Projects & Debt Planning
11 Recommendations
▪ Approve City staff and KNN reaching out to U.S. Bank (formally UBOC) to discuss renegotiating the release of City assets currently leased under the Master Lease Agreement
▪ Look into next steps regarding financing a Police HQ and other large-scale CIPs within the constrained amount dictated by the UBOC agreement
FINANCING CIPS
CONSTRAINED
AMOUNT:
✓ $169,100,000 ✓ UBOC cap on debt service (10% of GF
Revenues)
J A N U A R Y 3 0 , 2 0 2 5
Questions?
Melissa Shick, Municipal Advisor, KNN Public Finance
[email protected]
Nalungo Conley, Assistant City Manager, Vallejo
[email protected]
Nalungo Conley, Assistant City Manager
[email protected]
Finance Department
Presentation on
Performance Auditor
Selection and Receive
From Council Direction
on Future Audit
Services
Recommendation
• Provide staff with direction on the performance audit services that you would like for staff to undertake
• Receive information from staff on the three audit firms that we will enter into professional service agreements (A) Government Performance & Policy Analytics, Inc. (B) Sjoberg Evashenk Consulting (C) Macias Gini & O’Connell, LLP
Background
• The Finance Department issued an RFP on July 30, 2025 for performance audit services
• The RFP focused on engaging consultants who could
provide the following:
– Audit and risk assessment services including financial, compliance, operational, investigative, or other
performance audits
– Objective and systematic examination of budget
documents, financial reports, policies, and procedures, and the municipal code of a program or function
– Applying a variety of methodologies, analysis, research, and evaluation to determine findings
Background cont’d
• Eight proposals were received that were responsive to the RFP
• Staff formed a review panel comprised of both City staff and an external expert to review
• All proposals were ranked according to their
qualifications, relationships within the proposed team, ability to provide services, and meet the requirements of the RFP , cost of services, and recent work with similar agencies to the City of Vallejo
• Following the initial ranking, the three highest ranked firms were invited to interview and present an overview of their company, services, and project team
Outcome
• The Three firms were:
– Government Performance and Policy Analytics, Inc
– Sjoberg Evashenk Consulting
– Macias Gini & O’Connell, LLP
• All three firms were deemed highly qualified. As a result, staff will contract for on-call services with all three firms as they offer slightly different subject matter focus areas.
This will allow maximum flexibility for staff to be
responsive to Council requests in the future
• Staff will contract with Government Performance & Policy Analytics, Inc. in a limited engagement to provide the
following services in preparation for the FY26-27 budget:
– Risk assessment
• Develop a rubric/methodology to assess
departments and/or programs
• conduct qualitative interviews with city leadership
• Coordinate data and provide analysis and audit plan
– Organizational Assessment/Benchmarking
• Look at staffing levels by function, expenditures by
function, and high-level indicators of service
intensity where reasonably identifiable
Next Steps
Fiscal Impact
• There is no fiscal impact as the City has already allocated $75k for the contract with GPP . Should the Council direct staff to pursue additional audit services, we will return for budget appropriation.
• Questions?
Recommendation
• Provide staff with direction on the performance audit services that you would like for staff to undertake
• Receive information from staff on the three audit firms that we will enter into professional service agreements (A) Government Performance & Policy Analytics, Inc. (B) Sjoberg Evashenk Consulting (C) Macias Gini & O’Connell, LLP
CONTACT(S)
Nalungo Conley, Assistant City
Manager
[email protected]
Broadway Village –Final Monthly Update
Gillian Haen, Assistant City Manager Natalie Peterson, Assistant to the City Manager January 27, 2026 Broadway Project Background•Location: 2441 Broadway•47 Permanent Supportive Housing Units •Roughly 99% complete•Partners:–Developer: Firm Foundation–Operator: Shelter Inc. •Firm Foundation –current property owners (through construction)•City to take ownership at end of construction for anticipated future sale/transfer to affordable housing nonprofit organization
Lease-up & Timeline •Lease & operator agreement has been fully executed•Shelter has building occupancy•HAP contract began 12/1/2025 •40 tenants moved in by 12/24/25•Remainder moved in thereafter-full project is leased up•HCD documentation has been submitted to ensure City is place in compliance status.•Ribbon cutting-post tenant move-in-March Other Updates:•Water Line Break (managers unit)-repair completed
CONTACT(S)
Gillian Haen, Assistant City Manager [email protected] Peterson, Assistant to the City Manager [email protected] Blue Rock Springs Golf Concept Plan
1 Contextual Map
2 oOver 30 Years of Global Golf Course Design and Development ExperienceoOver 100 Courses WorldwideoAward Winning, World-Class Course DesignsoLeader in Environmental StewardshipoPrincipal –Greg Norman oOver 70 Continuous Years of Master Plan Community Design and Development ExperienceoOver 55,000 Homes Developed (Including in Vallejo)oDeveloping Communities, Apartments, and Retail Projects in Solano County Since Early 70’soCurrently Most Active Developer in Solano CountyoPrincipals –oRichard LewisoRandall LewisoRobert LewisoRoger LewisoJohn Goodman Blue Rock Springs, LLC
3 Chris Campbell SVP, Greg Norman Golf Course Design
As Senior Vice President of GNGCD, Chris works directly with Greg Norman to ensure that every aspect of the design business is operating efficiently. Beyond design and project oversight, his responsibilities include client support, global marketing, business development, contract delivery, staffing coordination and day-to-day operations. Chris also manages Greg Norman's personal involvement throughout the design and construction of each course to ensure that his ideas and philosophies are an integral part of each layout and the value of the Norman brand and GNGCD’s expertise is maximized for each client.
Carl Campos CEO, LCA Architects
Carl Campos is a dynamic strategic thinker who brings more than 35 years of architectural excellence to each of his endeavors. Complicated, intricate projects are those in which Carl’s expertise is most evident. Whether it’s designing highly technical facilities, planning standards for large corporations or gaining entitlement approval in a difficult jurisdiction or neighborhood, Carl meets each of our client’s needs on time and on budget while ensuring that every condition is met. Carl is also the President of the California Architects and Engineers Safety Association. 4 Lee Rosenblatt, P.E.CBG Civil Engineers
As a Principal and for over 24 years, Mr. Rosenblatt has been involved in the planning and engineering of a wide variety of improvements including major subdivisions, stormwater quality basins and infrastructure, major roadway reconstruction and widening, major arterials design with associated drainage structures and bridges, as well as regional trail systems, creek, and park design. Mr. Rosenblatt has utilized his management expertise to effectively lead his design team to cost effective, well thought out designs. This process has required close coordination with public agencies and both private and public landowners. It is this teamwork which Mr. Rosenblatt fosters both inside and outside of the office that has championed this success and these results.
Project Team
-
Consultants
2017 City –Development Partner Recruitment & Selection
2018 –2019Community Outreach
2020 –2021Lake Herman Quarry Settlement
2022 –2024Public –Private Partnership
2024 –2025 Subcommittee Meetings
2025 –2031Performance Agreement Milestones
Project Timeline
5 Purchase Agreement
December 2022
o
Preserved and protected
city land use decisions by
confirming exemption from the
Surplus Lands Act
o
Appraisal (Required): $285K
o
City retains 100% revenue/operational
oversight
o
Developer has no rights to Property for use
o
City retains Lease on Property at $1 / year
o
Developer negotiated closing of $400K w/ City
Participation Agreement
December 2024
o
Confirmed Public
-
Private Partnership (City
–
BRS)
o
Pending Milestones 2 and 3 (Golf Focused / Concept
Plan); Entitlement Applications to be submitted by
Developer
o
Additional Consideration (City)
o
Century Urban
–
City’s Financial Consultant
–
Audit Financials (3
-
5 months, 2024)
o
$1.5M due to City upon Entitlement
o
City negotiated to maximize proceeds by
receiving balance of consideration at lot sale
o
All revenues taken into consideration at time
of land sale (Upside)
o
City to receive % share of revenue to fund
Golf Facilities
o
City guaranteed minimum of $10M
o
Appraisal required at the time of Entitlement to
confirm land value(s)
Public
–
Private Partnership
6 Performance Milestone #2 Resolution Summary
7 oSeptember 9th, 2025: Blue Rock Springs, LLC presented the Golf Facilities Preliminary Cost and Scope to the Vallejo City Council.oSeptember 16th, 2025: 60 days after the delivery of the Golf Facilities Cost and Scope to the City, The City of Vallejo will make their comments or selection from the options presented. The City Council approved:üClubhouse Preliminary Scope Option Number 1, and add the following:a.Look at increased event capacity of 500 peopleb.Add an optional task of under clubhouse golf cart storagec.Phase development task in order to allow for scaled implementationd.Explore youth center somewhere on the overall development site on the City retained propertyüGolf Facilities Preliminary Scope West Course Option Number 3 Performance Milestone #3
8 oBlue Rock Springs, LLC submittal of the Golf Concept PlanoThe City shall approve or provide comments back to allow for revision and resubmittal of Golf Concept Plan.oThe City shall respond to the resubmitted Golf Concept Plan within 90 days.
Blue Rock Springs, LLC Submittal of Golf Concept Plan120 days after the City approval of the Golf Facilities Preliminary Cost and Scope (Due 1/12/2026) Participation Agreement
2017 –2025RFQ Goals & Community Outreach
City of Vallejo RFQ, September 8, 2017oFocus on Preserving Golf as the Centerpiece of the Project –Golf FIRSToSolicitation of Qualifications and Development Concepts That Achieve:oGolf FIRST: Renovation/redesign of the municipal Golf Course absent of City subsidiesoGolf FIRST: Fund the development of a new Clubhouse. oClubhouse Built in the1960’soIndoor Seating Capacity 80oOutside Tented Capacity -NooPre-Function Space -NooOutdoor Reception Space -NooHousing / mixed-use development concepts must preserve community and neighborhood aesthetics. 9 Community Outreach Meetings 2018 –2019
Stakeholder Meetings 2024 –2025
Golf Concept Plan
10 Golf Concept Plan Overview 11
West CourseThedesignconceptfortheWestCourseasapurpose-built9-holePar-3course,createsadistinctandmarketablenewgolfexperienceatBlueRockSprings.ThelayoutstrategicallyrepurposesexistinggolfcorridorstominimizelanddisturbancewhilepreservinggolffrontageforallexistinghomesalongPebbleBeachDriveandClaretCourt.ThecompactPar-3formatdeliversacomplete9-holeexperiencewithinareducedfootprint,andthereturning-loopconfigurationenhanceswalkabilityandaccessibilityforplayersofallskilllevels.Thisconceptintroducesacomplementaryofferingtothe18-holeEastCourse,positioningBlueRockSpringswithtwodistinctgolfexperiencesthatappealtoabroaderaudience.Thecourseisparticularlywellsuitedtonewgolfers,juniors,families,andtime-constrainedplayers,supportingamoreinclusiveandsustainablebusinessmodel.Lowergreensfeesandshorterroundtimesimproveaffordabilityandaccesswhilestrengtheningoverallrevenuepotential.TheWestCoursealsofunctionsasagatewayintothegame,helpingbuildlong-termdemandthatbenefitstheEastCourse.Thedesignremovestheshort-gamepracticeareatofocustheWestCourseexclusivelyonthe9-holePar3experience.Thedesignalsoresultsinminoradjustmentstotheresidentialdevelopmentboundary. 12 Clubhouse and Banquet Hall
13 The
proposed
Clubhouse
is
located
on
a
portion
of
the
existing
Driving
Range
.
The
Clubhouse
features
a
Kitchen,
Bar,
and
Dining
Room
with
interior
and
exterior
seating
facing
west
towards
the
driving
range,
as
well
as
a
Pro
Shop
.
The
Clubhouse
also
includes
a
fabric
roof
structure
to
serve
as
an
events
space
and
Banquet
Hall
with
capacity
for
350
seats
.
A
private
wedding
garden
enhances
the
offering
of
the
space
.
This
proposal
has
a
total
of
271
parking
stalls
:
259
Regular
Stalls
and
12 ADA
stalls
.
The
parking
lot
includes
a
new
cart
barn
structure
with
capacity
for
120
carts
.
The
Clubhouse
parking
lot
is
designed
to
minimize
impacts
to
the
East
Course
.
14 15
Driving RangeAfocalpointoftheEastCourseisastate-of-the-artdrivingrangethatintegratesseamlesslywiththenewclubhouselayout.TheDrivingRangewillbeapproximately215yardslongwithfourtargetgreensprovidedatvaryingdistances.Userexperiencewillbeenhancedbythefollowingkeycomponents:Coveredstructurewith20hittingbaystoensuremaximumguestcomfort,providingshadefromthesunandshelterfromrainforyear-round,uninterrupteduse.Lightingtoallowforeveningandnightuse,extendingoperatinghoursandtherebyservingasamajorrevenuegenerator.IntegratedballtrackingtechnologysuchasTrackmanorToptracertoprovidereal-timedataanalyticsand“gamified”entertainmentoptionsappealingtoguestsofallbackgroundsandskilllevels.PuttingGreenandChippingGreenareprovidedatalternateendsofthetee,togetherformingaone-stoppracticecomplexwithconvenientaccessfromtheclubhouse.NettingisproposedtobeinstalledalongtherightsideandbackendofthedrivingrangetoprotectthemaintenancefacilityandHole14ofthegolfcourse.
Council RequestsLook at increased event capacity of 500 people.oAn increase of the Banquet Hall from 350 to 500 seats can be achieved.oThe estimated cost for the 500-seat option is $1.69M compared to $1.55M for the 350-Seat option, representing a $143K increase. oParking availability would be reduced from 339 to 275 parking stalls to accommodate the larger structure.
Add an optional task of under clubhouse golf cart storage.oThe basement Golf Cart Storage has an estimated cost of $1.6M.
Explore youth center somewhere on the overall development site on the City-retained property.oThe estimated cost of an 8,515 SF structure including a basketball court/gymnasium and facilities is $5.99M. oThe Youth Center would require a parking lot with approximately 49 spaces (construction not included in cost estimate).oThe total site requirement of the facility is estimated to be 32,000 SF. 16 Clubhouse Conceptual Renderings
17 18CORNER VIEW OF THE PRO SHOP
19WEST ELEVATION VIEW
20SOUTHEAST CORNER VIEW
21 EVENT CENTER
22EVENT CENTER
23 EVENT CENTER
24 EAST ELEVATION
NORTH ELEVATION
SOUTH ELEVATION
WEST ELEVATIONCLUBHOUSE ELEVATIONS
Cost Estimate Summary25
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For additional information please contact:Jeb Elmore [email protected] Nalungo Conley, Assistant City Manager
[email protected]
Gillian Haen, Assistant City Manager
[email protected]
Office of the City Manager
Federal Policy
Updates/Impacts
January 27, 2026
What’s New…
• The House has passed several appropriation bills
(Commerce, Science, and Justice were passed on 1/16 and are waiting for the President’s signature)
– This included an earmark for the City of Vallejo Police Department (~$1mil (Sponsored by Rep. Garamendi)
• The most recent unrest and protests around immigration enforcement has resulted in many in Congress to signal
that they are open to not funding the government moving forward, putting the threat of another shutdown on the
table. Staff is monitoring the situation with our Federal Lobbyists
What’s New, Cont’d….
• City of Vallejo Food Pantry Pilot- drafted the Letter of Information (LOI). We anticipate issuing this week (1/26- 1/30) with the due date February 27, 2026. Updates will be provided once data has been reviewed and analyzed
Update on Vallejo Housing Authority’s Housing Choice
Voucher Program
--1540 active participants in Housing Choice Voucher program. --Current cost to provide housing assistance payments (HAP) on behalf of participants is $2.3M per month.
Areas of Consideration:
1. Implementing Cost savings Measures per HUD requirements
2. Financial Analysis scope- per Council request-cost $7k
3. Create Housing Contingency Plan- to address funding in the event of a government shutdown or reduced funding for the program
--At this time there is no communication that the program will not be funded, and current funding lasts through MARCH 2026.
Contingency Plan for HUD voucher program
funding:
HUD Cost Savings Measures-
Voluntary
– Reduction in payment standards-from120% FMR to Basic
Range 90-110%
• Takes effect in 2027 at 2nd annual recertification
• Participant pays increased rent amount
• Payment standards will remain at 120% because the
current FMRs in Vallejo have decreased which decreases
the standards as of January 1st. No double decrease and would be cost burden for families
– Voluntary freeze rent increase approvals for existing leases • Takes effect immediately
• If landlords chooses to freeze rent, participant pays same amount. If rent increased, participant pays
portion increased.
Housing Financial Projection
Analysis Scope
• Scope from Novogradac, LLC (references from San Jose, Contra Costa & Santa Clara)
– Projection Analysis for HCV Program
– Objectives:
1. Prepare projections of a 5% HCV cut and 10%
admin fee cut by HUD using Guidelines in
accordance with AICPA (American Institute of
Public Accountants). Look at operating budget to
determine what impacts will be. Does not include
recommendations in event of cuts.
2. Presentation of projections
– Cost: $7,000
In the event of a future government shutdown for
consideration should Council choose to fund portions
of the landlord rent payments in several ways:
Housing Contingency Plan: Utilize potential Measure P funds to assist in paying HAP:
• Full monthly backfill for transition:
– Allocate $2.3M to support one transition month of landlord payments
• Partial subsidy of program costs:
– Provide 50% of the monthly program cost (approximately $1.15M) in the event HUD ceases funding
• Graduated reduction in subsidies
– Implement a phased decrease in landlord payments over 2-3 months. This would help lessen the abruptness of program termination.
Next Steps
• Implement Cost savings measures per HUD regulations
• Get Council/Housing Authority Board direction on HCV
program cuts and projections scope analysis
• Get Council/Housing Authority Board direction to
potentially pursue contingency plan
• Questions/comments?
CONTACT(S)
Nalungo Conley, Assistant City Manager
[email protected]
Gillian Haen, Assistant City Manager
[email protected]