[00:05] Speaker 1: Recording in progress.
[00:10] Speaker 2: Thank you and welcome to the special City Council meeting budget session of the City of San Pablo. Today is Wednesday, April 8, and the time is 502. Let us stand for the Pledge of Allegiance. I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, indivisible, with liberty and justice for all. Okay, City Clerk, roll call, please.
[00:52] Speaker 3: Council member cruz.
[00:53] Speaker 2: Here.
[00:54] Speaker 3: Council member ponce. Council member pineda. Vice mayor xavier.
[01:01] Speaker 4: Here.
[01:01] Speaker 3: Mayor pabone alvarado.
[01:03] Speaker 2: Here.
[01:04] Speaker 3: Council member cruz, vice mayor xavier and mayor pabone alvarado are present in council chambers. Council member ponce and pineda are absent.
[01:20] Speaker 2: Okay, next item.
[01:22] Speaker 3: Oral communications. This is a time for comments on any item within the Council's subject matter jurisdiction. If such item is not listed on tonight's agenda, the Council may not engage in discussion or take action on any item that is not specifically listed on the agenda. Your item may be referred to city staff for investigation, report or placement on a future agenda. Persons addressing the Council are required to limit their remarks to three minutes unless an extension or decrease of time is ordered. Please file your name and address with a City clerk on forms available at the Speaker's podium. Mayor, Currently I have no speakers.
[02:05] Speaker 2: Okay, thank you. And next item. Go on. Next item, please.
[02:12] Speaker 3: Okay, item number one. File ID 26142. Consider preliminary draft budget for fiscal year 2627 and fiscal year 2728. Biannual operating budget and capital improvement budget. City Manager.
[02:35] Speaker 1: Thank you, Madam Clerk. So, Mayor, members of the City Council, this is a special meeting format to discuss your preliminary draft budget for the next two fiscal year period. Also your capital improvement program budget as well for the next two fiscal year periods. So before we start with the new preliminary draft budget, want to just give you a brief overview before I turn the proposal, I mean the presentation, over to Mr. Castillo, our administrative service director. So leading up to our discussion, we did a preliminary draft budget review with the budget Fiscal Legislative Stand Committee. That was on April 1st. That consists of Mayor Pavona Barrado and Council Member Ponce. They were had an opportunity to preview the presentation that you'll see tonight with regard to the budget process. And as required by your municipal code, the City Manager is required to prepare a budget plan every year. And this is the preliminary draft budget. So you will receive the presentation tonight regarding how the city for this particular budget cycle really did a lot of hard work and scrubbing to eliminate a $4.3 million deficit forecasted in December 2025 for the next two fiscal year periods. We'll describe how we resolve those deficits, what actions were taken, and then kind of go over our fiscal condition with regard to our strengths challenges, our use of operating one time reserves as well as other budget measures that were taken to reach a balanced budget. So I'm happy to report that this preliminary draft budget is balanced for the next two fiscal years. That took a lot of fiscal discipline as a strategic approach versus a draconian approach, and we'll talk about that in a moment. And we used a series of budget reductions, tiered budget reductions, to come to a balanced budget without laying off any existing city employees. So I wanted to put that out there first. And then we'll go through some updated slides since the standing committee to reflect a little bit more accurate budgetary information, especially with regard to your reserves due to actions the council took in March. And then we'll also talk about next steps and our new revenue sources that will be coming online in the coming year, hopefully to address an ongoing 2 million structural deficit that we seem to be addressing every year through our our budgetary process and timeline. So with that I'll go ahead and turn the presentation over to Mr. Castile for formal introduction and then we can have a discussion with the council over next steps.
[05:30] Speaker 5: Mr. Castile, thank you City Manager Matt Rodriguez and good evening Council Member Cruz, Mayor Bono Verado and Vice Mayor Xavier. I want to take this opportunity to, as I mentioned at the Standing Committee to thank City Manager Matt Rodriguez as well as Assistant City Manager Amaria Latojeda and all our department heads and department staff. This as Matt identified, took a real collaborative approach in partnership to be as successful as we have we are right now. So I really want to applaud City Manager's office and also the department heads for the opportunity. So I'll move move to our agenda. So the agenda covers a list of items from our budget process calendar, the City Manager's fiscal risk warning and long term forecast, as well as 10 year baseline projections, fiscal fiscal austerity versus fiscal discipline approach and also the the reserve operating reserve balance I should say as well as project deficit before balance, the balancing of the budget as well as the budget balancing measures applied one time reserves to close out the deficit and impact on city programs and services which I'll detail as well as the biannual budget overview. For all funds. We have both general fund and special revenue funds and then revenue detail as well as the expense and personnel department detail, the CIP and also our debt services and our subsidies as well as our City Manager Guidelines for the new proposed budget. So this is our budget process and calendar. We began our budget process with our City Manager budget memo on October 7, 2025. Seems like yesterday and we're now in the fast forward all the way to 4-8-2026. So as City Manager Matt Rodriguez mentioned, our standing committee did receive a lot of this information on April 1st. It was no joke. It was April 1st. And where we're at today is to receive the proposed budget and I'll provide as much detail within the PowerPoint presentation and then we'll move forward into a public hearing on scheduled for June 1 and then for the council to or adopt the budget June 5th for our July 1st start date. And I do want to mention that the personnel budget from left to right on those tables we have a five year employee labor MOU agreements from 2022 fiscal year 2122 to 2627. We did identify that our health insurance premiums did escalate or increase and I'll get into that detail. And also our calpers UAL increase which is for the majority of cities and special districts throughout the state of California has increased ours in particular from 5.8 million to 6 million for 5.8 million in fiscal year 27 and 6 million in fiscal year 28. And then we also have our OPEB retiree healthcare cost as well increasing and and then services and supplies. We took a zero based budgeting model or methodology with our ClearGov system which is our budget system. Departments contain their costs within their department budgets and again insurance costs are escalating in general for general liability as well as workers comp. And then we also have our technology and infrastructure investments are also increasing and again I'll detail that.
[09:25] Speaker 1: So here just real briefly I wanted to advise council that for this for several budget fiscal year periods we do multi year budgets here and in our city manager budget message that I prepared I did advise council as far back as 20172018 that we did have fiscal risk warnings regarding the ongoing use of our operating reserves which are one time funds to fund on ongoing annual operating expenses. So in the overall scheme of things this warning was provided and again is provided for this two year budget that relying on temporary funding sources to cover recurring operational costs is not a sustainable fiscal strategy strategy. So we took a different approach this year to use a balance of cost reductions and some use of one time reserves rather than going to our ongoing practice of just covering it with the reserve. So we are depleting our reserves since the PFM study in December of 23rd which was at 63 million. Our reserve levels were down to now about 52, 51, 51 million. So that includes your latest mid year budget adjustments as well. So we've already depleted about 10 to 11 million dollars of your operating reserves which causes some pause and required it required us to look at a different approach to building the next preliminary draft budget.
[10:58] Speaker 5: Thank you. So as City Manager Matt Rodriguez identified in this slide here the long term forecast and economic outlook, he identified the strengths and challenges. What I'll move towards is this slide in particular provides us the PFM 10 year baseline projection model. If you could see there the dips in the usage of our reserves cumulative. The PFM was identifying that we would use total about 44 million of our reserves by 2032. In addition to that we have the which I'll also detail the casino revenue stagnant at this time. And we were having shortfalls at since 22. So I'll share those details with you shortly. In addition to that we have a significant increase in Calpert's UAL in general and they are estimating by 2034 about 11.6 million increase total. So this slide represents our major revenue sources. The major revenue sources we have from left to right is the casino revenue under the table as well as sales tax, property tax as well as utility user tax also known as the UUT casino revenue. We're looking at the actuals for 2526 30.9 million is the estimate we're looking for or at sales tax at 4.9 million. 1.7 million for property tax and about 3.2 million for the utility user tax. And during the budget fiscal legislative standing committee we identified this during our mid year budget around these actuals we're estimating for 2526 and those are projections for 2526 I should say. And the actuals are from 201819 all the way to 2425.
[13:01] Speaker 1: And also Mr. Kisio, can you point out that our casino revenue represents 59% or 60% of our general fund budget. So that's 31 million. So it is still a large share of our revenue perspectives to fund city programs and service delivery.
[13:24] Speaker 5: And thank you for mentioning that. And that's below in the table in blue or the banner in blue. The revenue trend as City manager Matt Rodriguez identified 31 for our current fiscal year which he represented as 60 million in addition or identified as 60 million. And then we do have a very slow growth with casino revenue at 0.6 and these are based on the actuals from 1819 all the way to 2425. And speaking of casino revenue, here's a particular table around the casino revenue which identifies the actuals for fiscal year 2223, fiscal year 242324 and 2425 and projected for 2526. This is why there's an asterid on the bottom variance in yellow of 900,000. So if we look at variance, the banner from left to right, we're looking at a little over 355,000 1.2 million. And then we have close to 850,000 prior year 2425 in a casino shortfall. And then we're estimating this fiscal year, which is fiscal year 2526 at a $900,000 shortfall based on the revenues that we received and also the trends of the actuals from prior years. In total we have around 3.3 million shortfall. If we go back to 2223 and what's the projected for 2526 and that four year average shortfall is around 837,000 and some change.
[15:04] Speaker 1: So I just wanted to talk about our strategic approach that we took to building our preliminary draft budget. So there's a discussion about what fiscal austerity or draconian approach versus a fiscal discipline approach. Most agencies when faced with drastic deficits immediately go to what's called a fiscal austerity approach, which is basically slash and burn because it's an indiscriminate process that applies to all city department budgets. It cuts all contract services and supplies programs and FTE staffing levels to reach an objective. And unfortunately that has an immediate and severe impact to the public. It reduces programs, the community and service delivery. Plus it also affects the organization's staff morale. It affects our recruitment practices and employee retention. So these are very short term reactive approaches that are very counterproductive to the organization. So instead of doing that type of approach, city staff embraced a fiscal disciplinary approach which is a more practical and strategic approach. So we have a series of tiered reductions from 1 to 4. Tier 1 is is freezing non budgeted ft vacancies. We currently have six vacant non budgeted vacancy that we vacancies we've been carrying in various departments since fiscal year 2324. Those remain vacant and that's been a cost savings that we've been able to absorb for helping to reduce costs. Tier 2 reductions is the use of one time operating reserves for annual operating capital expenses. As I mentioned, that's an ongoing city practice that we're going to be revising this year to take a more balanced approach since we've severely depleted already our operating reserves to balance our shortfalls. And then Tier three, which was a a huge emphasis this budget cycle is to reduce and revise non essential contracts, professional services, capital outlay and other spending. And so through these combinations of Tier 1, 2 and 3, we're able to be able to tackle the forecasted deficits, which we'll get into in a moment. The last tier, tier 5, tier 4 is reduce or lay off existing FTE positions. So I'm happy to report we're not using any Tier 4 reductions as part of this preliminary draft budget plan. So that's used as a last resort option and we're not planning on using that as a budget balancing tool for this preliminary draft budget period. So this is long term preventive and strategic and it reflects discipline and measured fiscal management because you're living within your forecasted revenues and you're not trying to spend money that you don't have available to continue fund your operating expenses.
[18:04] Speaker 5: Thank you City Manager Rodriguez and I, I have to give credit where credit is due. Our Assistant City Manager Mario Heather and as well as City Manager Matt Rodriguez provided a inclusive approach with all department heads, including myself, to really, as our Assistant City Manager Medea stated, sharpen our pencils. And our department heads did so. And I want to thank them and their department staff because they really assessed every single line item, every single contract within those line items in order for us to be where we're at right now. So I really want to applaud the City Manager's office as well as our department heads for really making this a productive process. I've been in the process where it is a slice of 10%, 30%, whatever that may be, and it doesn't have a good feeling. So we felt empowered and took ownership of our depart of our department budget. So I really want to thank everyone for that. Moving to our reserves is that we, our operating reserves have depleted since I came in 2024. As City, City Manager Matt Rodriguez stated, around 63 million. And to start for this current year for 2526, particularly January 20, 2026, we were at 60 million six, I'll say 60 million. And we now have appropriated around 8.5 million in reserve funds for operating reserves from these particular operating reserves. If we go down the list, we have a total of 10. Some come from our operating budget percentage and some come from our fund balance. So in general, within this time frame, in this fiscal year we used 8.5 million again which is significant compared to what we have in the past. So this shows a trend of us obviously utilizing our operating reserves. So our major budget changes and key drivers from left to right cost increases to savings and revenue. So cost increases. I'll focus on the top three. We have CalPERS, UAL. Here it is again. Went up over a million from for fiscal year 27 compared to 26. So that's a 22% increase. OPEB retiree health that went up over 700,000 in fiscal year 27 compared to 26. As our mayor Pabona knows as well as our standing committee other chair Council member Ponce is that the in during mid year we identified that we did not budget for opeb. So it seems as a significant increase compared to current year. Although we are starting to see an increase in OPEB in general. So I'll be very clear is that we identified that these that we were trying to appropriate funds directly from our OPEB Trust which is a separate special revenue and we identified in mid year that we could not pull out of that fund into our general fund. So it's an accounting specific practice and what we know now is that we are now budgeting correctly and moving forward around OPEB to come out of our general fund appropriately and budget appropriately. So I want to be clear on that. In addition we have our property insurance. Here's another significant one. Our general liability and our workers compensation is increasing close to a million dollars for fiscal year 27 compared to 26 and each year it's increasing in 27. It's obviously increasing in 28 and then we go into savings. Though I do want to applaud everyone for moving forward the cannabis revenue. We're looking at a $350,000 growth in fiscal year 27 and then we're also looking at over 400,000 for fiscal year 28. So that is providing us the revenue needed in order to continue our general operating funds or and services and supplies and proceeds from sales. We're looking at around $2 million for fiscal year 27 for our property sale and we're looking at 2.5 for 28 and for use of property. This is particularly around our earned interest. I have to, I'm not highlighting just because Matt's obviously my boss but but I have to tip my hat off to our city manager because he has he identified working with our advisory group called Shuster Advisory Group around our earned interest projections. We never budgeted well our earned interest from our investments and this was identified by our city manager's office to work with our investment group to project for 27 and 28. And we, we identified an increase of $2.6 million in earned interest that we're budgeting now. So that has always came into the books. But now we're able to project and also work with this investment company, who's our fiduciary, to really increase that earned interest and maximize our investments. So I have to tip my hat off to Matt for that. And then in general, I do want to mention, I know I mentioned the top three, but I do want to mention medical benefits. As I mentioned at the standing committee, the city utilized in the prior biannual and the one before that for 22 and also 23 is that they use the peanut butter effect of Kaiser plus two plan. So what that means is that I could have Kaiser two and our city manager may have Kaiser one. And so what happens is when you use a peanut butter approach is you elevate your cost for medical insurance. And so we identified that increased our personnel cost. And actually we did not need that. So what we did is we looked at every single employee and identified what their actual medical selection was to look at that cost to project based on actuals, not based on a peanut butter effect. So this is why you see an elevated savings of about 500,000 is because we went back to the actuals of what people are utilizing and selected in October 2025 during open enrollment. So our next slide, our city manager identified the 4.3 million dollar deficit, as I mentioned. And sorry I'm being repetitive, Mayor Papona Varado, but I have to say this is that I was pulling my hair around the 4.3 million because I didn't know how to really talk to Matt and say, hey, we're going to need to do some serious reductions in order to meet this deficit. And again, I have to tip my hat off to City Manager Matt Rodriguez and also Assistant City Manager Maria Ojeda, who had our, had us sharpen our pencils. So our department heads identified a significant savings or significant, I would say savings in their departments where they could identify how to reduce that shortfall. So where we're at today is a $2 million total shortfall compared to a $4.3 million shortfall. And that really was around us identifying which revenue sources we could increase or what we were missing, as well as our expenses. So again, I have to apply our department heads and our city manager's office for this. Now we're going into Budget balancing measures to reduce the deficit. So now that we reduced our deficit to a more manageable allocation where we identified from 2.1 million in 2627 to 800,000. And this went to new cannabis sales proceeds from sales of property, earned interest as we mentioned and department services supplies reductions as well as contracts IT consolidation and I was mentioning the medical benefits. The IT consolidation optimization is that many departments had similar software or programs that they were purchasing. So we wanted to consolidate all department programs and software into one department which IT and admin manages in order to minimize our cost. And then for 2728 the balancing deficit at the time in December was 2.2 million and we reduced it to 1.2 million. And this again went to cannabis proceeds of sales and property, continued earned interest allocations and obviously reduction of services and supplies and contracts and the continued actual medical cost. And what funds are we going to utilize in order to balance our budget? Here we are. Historically we've utilized the GFDR Fund 110, that's going to be a quarter million as well as Our Sales Tax Fund 103 is another quarter million. We identified the sales tax because we know they're there's a trend of a reduction in sales tax. So this is a more appropriate reserve to pull from or appropriate from. And then we have our casino sustainability fund at 180 for 312,000 for fiscal year 2627 and then for 2728 is similar except the casino sustainability fund will be over 700,000 for a total of those reserves at 1 1.2 million. And that balances our budget. So again from a 4.3 million dollar deficit to a million $2 million deficit is a lot more manageable and percentage of costs and reductions. So as I stated the 4.3 million and then we in March got to a 2.3 million and our third round we got in March 2020, late March 2026 to 2 million. So you see those reductions was really again the support of the city manager's office as well as department heads.
[28:55] Speaker 1: So I just want to point out that this preliminary draft budget as you can see is using a more fair, balanced approach of cost reductions and use of one time operating reserves. So what we would normally have been doing in the past is just covering the entire 4.3 million with one time operating service. So I think the council should be fortunate to realize that this approach this year using the fiscal discipline of strategic approach enabled us to take a more fair, balanced approach to how we're eliminating the deficit. So I just want to highlight that, that through a combination of cost reductions, Tier 1 and 3 and the use of one time funds we were able to tap tackle that deficit that was forecasted for the next two years.
[29:42] Speaker 5: And in more detail of that summary reductions we have this slide. And I'm going to go left to right. We're going to go left down to right down. Is that our police department. Thank you Chief reduced his budget by 767,000. We had citywide reductions including it and again as I mentioned, the medical benefits of 750,000. Our public works department. Thank you. Public works for 150,000 reduction and then community services. Thank you Mr. Dwyer. Greg Dwyer reduced it by 550,000. And this is due to the West Contra Costa county fiscal cutbacks as well. And uncertainty is that they I believe are still in labor negotiations. And this will also our community services department, which holds very crucial services to our community, will be impacted by our measure S sales tax revenue in fiscal year 2728. It reduces by a quarter cent to a quarter cent from half a cent I believe November 2027. So just note that that will impact community services and other departments as well.
[30:58] Speaker 1: And, and when we talk to the stand community about this, right now the school district hasn't adopted their budget for the upcoming school school year for 2627. So at this point in time we have to go with a conservative worst case scenario. Now if the school district is able to add their non essential staffing back into their budget, there's also some state legislation being introduced to help fund school districts with full service community schools. If that bill gets approved in the state budget, that won't be known until September when the governor enacts all the bills into law. So at the mid year budget cycle, if we see the district coming back to replenish their lost programs and and lay off to positions, then at the mid year budget cycle we can reconsider adding more expense to that side because we can't really mount through our youth services Community partnership division successful programs. We don't have our partner agency on the other side of the fence supporting these programs if there's no staffing available. So we're sort of having to deal with the school district's fiscal uncertainty right now. But again, there's an opportunity to amend our budget later if they're able to replenish that funding during the the course of the school year for 26, 27.
[32:25] Speaker 5: Thank you for that. Thank you for that. So going into the final but not least Department is community development at 80,000, reduced their contracts for the inspectors and they really reviewed the balance between their personnel vacancies as well as these contract services. They'll maintain contract services for inspectors. But they're looking, they were looking more detailed into that. So our next is the fund review. Revenue versus expenses. So what I'll do is identify the columns in the blue rib in the blue table. Sorry, blue rows in the table. So from left to right, our expense, our revenue totals for fiscal year 2526, which is current year, is 69.9 million. If we jump to the 2627 total, we're identifying 72.4 million. So that's a variance of 2.4 million. For our expenses. Our current expense total is 68.3 million. And if we jump to 2627 totals, it's 73.2 million. So if you see there, there is a deficit compared to current year. But just. I just want to note that current year 2526 is utilizing this year over $3 million from GFDR. For 2627, we will be utilizing 800,000 for, for the surplus for the shortfall. I'm sorry. So just know that's why we have a cushion in 252026 of 1.5 million. If we go to 2728 are compared to 2627, we have a total revenue of 72.4 million. As I stated, for 2726 27. And for 2728 we have 74.6 million. So it's a $2.2 million increase. And then for fiscal year 2627, as I mentioned, 73.2 million in expenses, we are identifying for 2728 75.8 million, which is a $2.6 million increase. So I'm going to identify just the items, the rows and blues and there's details there. In general that will be more. Have more graphics in a later slide. In General though, for 2526, if we look at the total revenue is 58.9 million. If we look at 2627, we're identifying 64.5 million and that is an increase of 5.6 million. So we're seeing increases in various revenue sources, but we're also seeing some decreases as well. And I'll detail that in a second. And then for 2728 we have in total, again as I mentioned, 2627 64.5 million in revenue. And then for 2728 in total, we have 66.4 million, which is a $1.9 million increase compared to 2627. And this is the graph that I was mentioning. There's another one thereafter where we identify the total revenue types and the percentages provided. So we have casino revenue for 2627 and 2728 at 54.8%. And then our next in line would be our sales tax and then obviously our casino property in lieu of tax. And then we also have our
[36:33] Speaker 3: use
[36:33] Speaker 5: of property, our utility UT, which is our user utility tax at 8 point, sorry, 5.7%. And we also have our vehicle in lieu, which is 6.9%. So here's our percentages based on revenue type, which gives us a good visual of what's coming in based on those revenues.
[36:54] Speaker 1: And I do want to point out the the last bar graph on the far right, cannabis. That's a new revenue source. So hopefully that's going to grow over time.
[37:02] Speaker 5: Thank you. And I did that oversight. And that is a new graph and sorry, a new line in that graph. I appreciate it. And if we look at expense summaries, I want to point out that personnel is our most significant cost. So just note that on the pie graph below, for 2627 56% of our budget is personnel and 33% is our services supplies and 11% is our transfers into our special revenue funds. And for 2728 there's a slight decrease in personnel and an increase in sales and sorry, services and supplies. And then we maintain 11% at transfers. So personnel costs. Let me provide some more details. In total, for 2526, if we look at total personnel, we have 39.1 million. For 2627 it increases to 40.7 which is an increase of 1.6 million. And then for 2728 we have 41.8 million which is an increase of over a million dollars. So if you see on the bottom, our UAL is significantly increasing each year. In addition to our OPEB and personnel cost is our greatest cost for our personnel for our general fund budget. And then we have services supplies. And this is based by department. I'll identify the rows in blue which is for 2526 we had about 17 point total cost and service supplies. For 2627 we have a total of 20.3 million, which is a $2.4 million increase. And then for 2728 we have 21.4 million, which is a million dollar increase. So there is a significant increase compared for 2627 compared to current year 2526 and a slight increase for 2728 compared to 2627. And those are the details of those variances. So going into our CIP and debt service summary, we have a total of $2.7 million in debt services that we pay for our bonds. This includes the incredible beautiful city hall, our new PD headquarters, and in general, these debt services are until, I believe 2052. Some of them, especially the redevelopment or successor agency is ending in 2032. And then we also transfer a million dollars from our general fund revenues into our cip, which will receive a presentation for public works in more details around what that pays for.
[40:04] Speaker 1: So one of the critical things to mention about our debt service is that we currently have a double A minus credit rating, which is very good. And so it's very important as a city that we maintain that credit rating. We don't set that credit rating. That's set by our credit rating agencies who look at all of our financial obligations, what we have outstanding on the books, and then how we're managing our cash and operating expenses year to year. So it's very important that we continue to have good replenished reserves because they do look at our ability to manage our fiscal management. And as interest rates drop over the next couple of years and we have a more positive interest rate environment, the city must position itself to take advantage of the bond markets because we will be refinancing some of this debt so we can reduce our debt service annually. So if I'd like to get that under 2 million if I could, instead of 2.7. So that's something that we're going to be doing on. So we have to be very careful that we maintain this financial good credit rating and that our optimization operating costs are within our projected revenues. If we don't do that and if we get a lower credit rating, the cost of bond issuance and bond insurance requirements will go up. And that means the cost of issuance for all of those requirements would be substantial. And if we are looking and we continue to sustain declining casino revenues, that also will increase our cost of issuance and the bond insurance requirements. So it's very important that we continue to maintain good fiscal management, that we're not overzealous, our spending beyond our revenue capacity until new revenue sources come online so that we're living within our projected revenues. So very important that we maintain that because it does reflect our credit worthiness from the credit rating agencies.
[42:19] Speaker 5: And speaking of, and speaking of that we have our general fund subsidies to special revenue funds we offset or subsidize a significant amount from our general fund into these special revenue funds. And let me identify them. So our fund 200, which is our gas tax for fiscal year 2526 the transfer was 432,000. For 2627 it increased to over 819,000 which is a variance of 386,000 and some change. For fiscal year 2728 that slightly increased to 848,000 and some change which is a variance of of close to 30,000 for Measure K. And again, I apologize for gas tax. That's our road maintenance needs that we have obviously. And then if we go to Fund 201, which is our Measure K, that is our Contra Costa Fire District contract in 2526 there is sales tax obviously from measure K. Our subsidy for current year is 760,000 and some change. Although in 2627 it increases to over a million dollars which is a variance of 247,000. And then in 2728 it increases to over a million with a slight increase of close to 78,000. And our Fund 212 is our development services or community community development department. Historically our community development department has sat in a special revenue fund in most cities usually sits in the general fund. So there's discussion of moving that to the general fund. The I believe the general mandate is that we cannot utilize development fees for general fund. So there's discussion again on moving our community development department into the general fund budget rather than having a special revenue fund. But getting back to the the allocations is that in 2526 we allocate we transferred 838,000 and some change. For 2627 it increased to 1.1 million and which is a variance of 263,000. Some change. Now that is mainly personnel. So just a heads up on that. And then we have 2728 a transfer of 1.1 million which is a slight increase of 67,000 and some change. And our last special revenue fund to receive the transfer is our street lighting and landscape, also known as LAD District is a Fund 237 in current fiscal year it's over a million and you have a slight increase of 50,000 to 2627 for the proposed over a million dollars. And then you also have for 2728 another increase of 70,000. Now these, this is one of our largest subsidies in addition to our measure
[45:41] Speaker 1: K. I do want to point out that you know the LAD process and we've identified this during Our revenue mechanism discussions last year is that property assessments in San Pablo have not increased since 1997. So they remain at 840,000 a year. So it's not sufficient to cover all of the district's expenses. So it has to be subsidized every year. Now one of the goals is to look at going back to our property owners and assessing them to increase that property assessment. We made a decision to defer that because we know that the college district has a bond parcel tax measure coming forward this November. The school district may also pursue another bond measure to right size their budget from all of their labor contracts that they negotiated and their their overall fiscal condition. So we know that our property owners are going to be tapped out via property assessment. So it's not a good time to go back to them to increase that assessment. But it's been 30 years since they've increased their assessment to help with the landscaping and line district. So that's something we're going to going to have to continue to monitor. But it is a large subsidy to
[46:57] Speaker 5: our general fund and in total biannual general fund subsidies is 8.2 million, which is over 2.1 million in prior year.
[47:11] Speaker 1: So I just wanted to highlight that back In December of 2023, I came to the Council with a number of different financial guidance tools that we were having to implement as part of your work work plan. This was adopted into the work plan for our budget planning going forward for fiscal year 2425 and 2526. So we've implemented most of these guidelines. But one thing that we have to continue to monitor is number eight, avoiding creating any new general fund structural deficits or shortfalls.
[47:47] Speaker 6: 9.
[47:47] Speaker 1: Be prudent and strategic in managing any new FT staff investments. We're not proposing any new investments, but until our revenue capacity increases, we're not going to be in position to add any more bodies to our employee workforce at this time. Also number 10, we have to create new revenue opportunities to meet operational requirements and debt obligations which we are going to be exploring. And we'll talk about those new revenue sources that are going to materialize over the next year, including looking at a new funding mechanism for November 2026. Next slide in. In the course of adopting our next two year budget, we will be implementing a new priority based budgeting model, deviating away from the zero based budget model we've been using for the past couple years. And priority based budgeting is a new approach. It's going to take about a year to implement. So for the next budget cycle for 2829. Well, city staff and departments are going to be focused on spending on community priorities, whether they be public safety, illegal dumping, parks or road repairs. Those programs have to be ranked and we must budget according to those top priorities as adopted by the city council. So funds would be directed to the highest priority programs while reducing our red designing lower value services to improve efficiencies. So we're going to be starting that work this summer with the council in terms of retooling your work plan to prepare for priority based budgeting model. So that's something we're going to be doing. Also item 13 is a new one. We have to look at Tier 4 budget reductions. If our new revenue sources do not materialize for whatever reason, if our voters don't support our funding mechanism, if we aren't able to implement all of our revenue sources that we're identifying, that's going to materialize and then we see casino revenues continue to decline, then I have to conduct some comparative organizational analysis of FT staffing and our structure. Because this is for advanced planning decision making. We need to look at our size compared to other smaller size system cities. This would be subject to collective bargaining, of course, because of state employer law requirements. Phase one would be all of our administrative city departments and phase two would be police department. This is something city managers don't want to do, but it may be operationally required if our revenue sources do not come online like we're planning or if our annual casino revenue continues to go decline. These are things that we may have to explore for the next budget cycle. Something that's going to be very impactful to our organization. Next slide. Also, I do want to call attention to your current city council adopted policy 405.2. The city manager and staff built the preliminary draft budget plan based on this policy that's been adopted by the council since December 9, 19th, 2024 by resolution 24 149. So this fiscal discipline and financial practice means that we cannot add any new programs or staffing levels until we generate an additional net increase of a million dollars to the city's general fund. So we're on pace to increase our general fund revenue capacity, but it has not materialized yet. So that's why there are no new programs and no new staffing proposed in our in our preliminary draft budget for you today. And note, once we do have our revenue sources coming online, the procedure that we will bring back to the council will be to first modify or rescind this policy. 405.2 and then consider adding new spending programs which have to be reflected in the current council priority work plan and they must require a fiscal impact analysis before funding appropriation via resolution. So we're hoping to reconsider this at our mid year budget cycle which will be after November 2026 and after we complete the audit for this fiscal year when our books close on June 30th. And this will be post when all our new revenue sources materialize. So I just want to point out your existing policy next slide. And this slide represents the four potential new revenue sources that will hopefully generate between 4 to 5 million over the next year. You have already authorized us to develop and update our master fee schedule that was approved by the council last November. Sorry, that's a typo. 2025 and it's in effect as of January 16, 2026. We're hoping to yield 200 to 400,000 annually. And then your next revenue source is commercial cannabis which we're in the process right now. You have two cannabis retailers who have received their conditional use permits. Our first cannabis retailer just became operational last week and the and so we're hoping to at full operation. If we have three cups approved, it could be generating close to 2.2 million annually. So we'll see how that moves along. Also the new half cent sales tax measure. Council will be making a decision this July whether to put this measure on the ballot for November that could yield another $2 million if passed by our local voters. We will be doing additional polling for this funding mechanism and bringing that ballot language for your consideration again via ordinance which requires a four fist vote of the council. And then last, our PD headquarters training center project. We're at the final stages of construction. Once our facility is occupied by our police department and fully operational, we hope to generate between 200 and 400,000 annually just on the fees through our consortium with the other law enforcement agencies in the region. And we hope to generate that funding to go to our city's general fund. So you can see the potential revenue increase coming online is 4 to 5 million. However, as mentioned earlier, we do have our measure S sales tax shift which is going to occur during 2728 on October 1, 2027 where we will reduce general fund revenue by 1 million. Because of our voters who voted in measure s back in November 2020, our half cent sales tax measure shifts to a quarter cent sales tax. And so we're going to be dealing with that net revenue loss to our city programs. So net general fund revenue increases of between 3 and 4 million dollars added annually. So we're patiently waiting for those revenue sources to materialize and hopefully they will so we can come back to the council at mid year and make appropriate adjustments to the budget. Next slide.
[54:59] Speaker 5: So staff recommendations are number one is consider the preliminary draft budget for 2627 and 2728, biennial operating budget and also capital improvement program which we'll present next. And also proceed with city council public hearing on June 1, 2026 to approve the final fiscal year 2627 and 2728 biannual operating budget and two year CIP budget. And here's where we pause and ask if you have any, any questions.
[55:38] Speaker 2: Thank you. Arturo, do we have any public comment on this item? I think everybody asked that, huh? Yeah, I think I did. Sorry, but no, we don't have any. Okay. All right, Council Member. Thank you, Arturo, for the presentation. Council member Cruz, do you have any questions?
[56:04] Speaker 7: Yes, thank for that presentation. I just want to be more clear on what the CAL purse UAL and OPEB retirement retiree healthcare is. Can you explain that to me?
[56:18] Speaker 5: Yeah. So that is our contribution to have our employees participate in the CalPERS retirement program. So that is the estimate of that particular agency, CalPERS, around what our cost is to the contribution of the city into the retirement plan.
[56:38] Speaker 7: So is that, is that those funds, are they banked or sent away in accounts for the employees and retirees? How does that.
[56:48] Speaker 5: So each. So that particular fund goes directly to CalPERS and we provide them regularly a list of employees and it's based on classification years of service around what their retirement estimates would be. And based on that information, they provide us those estimates.
[57:09] Speaker 1: And also the UAL does reflect because obviously CalPERS manages a very large significant investment pool for all the agencies in California, California who are contract agencies like us. And so they do have policies with regard to passing along investment losses for that pool. So sometimes when investments fluctuate, we also, all of us contract agencies have to pay for those cost increases for those investment losses. So that's part of our UAL payment as well.
[57:43] Speaker 7: Okay. And let's see. I think the capital project is going to be the next presentation.
[57:50] Speaker 5: Yes, that's correct.
[57:51] Speaker 7: I'll hold these other questions till then. But how do we plan to replace our operating reserves like once we use them?
[58:00] Speaker 1: So as you know, we've been modifying your fiscal resiliency reserve policies. Maybe you can go back to that slide with all the reserves are true. And remember, there are formulas attached to each of those reserve levels. So once we adopt the budget and we close the audit for the year we prepare the act for, which is your annual comprehensive financial report. Arturo works with our auditor to get that completed. That's usually done in the fall. And then we bring forward the ACTFR with an audited fund balance figure. And that audited fund balance figure in addition to the formulas in your FRRP policy, sort of replenish these 10 reserves based on those formulas. And those policies have been adopted by the council, by resolution. And we're on our fourth or fifth Amendment, fifth correct amendment. So we're constantly refining the policy so that we keep these reserves plentiful so that if there's a need for any unforeseen or emergency, these reserves are available for us. Now, one thing that we haven't talked about is the economic existential threat of a new casino coming into our market area. So as you can see, if we were to be impacted by a new casino, which there is one under consideration for Solano county in Vallejo, if the federal government approves that, that could be a drastic revenue, revenue loss for casino San Pablo and then the city under the terms of our msa, So a lot of these reserves would be impacted. So we're fortunate right now that as long as we have audited fund balance every year after we complete our Act 4 and we adopt a, you know, balanced budgets, those FRRP policies enable us to sort of replenish these reserves as we go forward.
[60:02] Speaker 7: So right now, how much do we have in the reserves?
[60:05] Speaker 1: Right there you can see.
[60:06] Speaker 5: So it's here in, in yellow is the 51.8 million that's appropriated.
[60:11] Speaker 7: Okay.
[60:12] Speaker 5: And as City Manager Matt Rodriguez stated, it depends if those, some of those funds are if we utilize more or those that we transferred or not utilize at the end, we check our books and identify if they have not been utilized to move them back into our fund balance and to see if we have a surplus. And I do have to mention that this is our fifth amendment. And what we receive from our auditors and others is this. We have a very sophisticated fiscal resiliency policy. And this is a good reason why we have it is because sales tax are going down. We did that at mid year as well as to general liability. So we, we, we're in, in really good planning phase for fiscal resiliency policy.
[60:59] Speaker 7: Yeah, I think that's very healthy. Still at the 51.
[61:01] Speaker 1: Yes. And remember I talked about the credit agencies. They look at this and they look at how much, how much operating reserves are being appropriated every year. That's why we need to kind of deviate away from using them as a source for our operating expenses. That's all. We have to increase revenue so that we have less reliance on the operating reserves because it's very important to keep them intact.
[61:23] Speaker 7: So the reserves are only used for these kind of moments, correct?
[61:27] Speaker 1: Yes. When we have shortfalls.
[61:28] Speaker 5: That is correct. And the GFOA bases the cat. So the fund 150 catastrophic reserve is the only one that's best practice or required by GFOA, which is 30%. We have a 50%. So going back to your statement, Council member Cruz, is that we do have healthy reserves, although they are being utilized.
[61:52] Speaker 7: Okay. Because my concern would be like a, a catastrophic event or circumstance here in the city. Well, that would be a catastrophic reserve.
[62:01] Speaker 5: Yes.
[62:01] Speaker 1: So if we have an unforeseen contingency like a calamity such as like an earthquake or something, and we have to expend more multiple millions of dollars for whatever public health and safety expense we would normally go to your catastrophic reserve. However, Fund150 does have a replenishment requirement. So if we appropriate out of that 150 fund, we have to pay that back within. Is it three years or one year? I can't remember.
[62:29] Speaker 5: I believe it's one year.
[62:31] Speaker 1: One year. We have to replenish that whatever we use within a year.
[62:35] Speaker 7: Okay.
[62:35] Speaker 1: Secondly, Fund 170, your budget stabilization reserve. If we appropriate funds out of that, we have to replenish that over the next three fiscal years. So those two funds in particular, if we use them, which we avoid always, we never try to use fund 150 or 170. So that's truly for emergency and catastrophic uses. But we have to pay back those reserves.
[63:01] Speaker 7: Okay. I think we used that one time during the pandemic. Was that.
[63:06] Speaker 1: No, we had enough one time funds in 110, your general fund designate reserve. Because the casino lost about $78 million because of COVID So we had to use a phone 110 to replenish that revenue.
[63:20] Speaker 7: We pay our back. Yeah. Okay. And then let's see. When you went through the, through the numbers, did you find any really big misspending or any area where we, we could have like did better come back or without without affecting our normal programs and services? Did you something really stand out like where we saw a lot of misspending in this area? I know the department heads did a great job on going line by line, but did you see something really stand out transparently?
[63:59] Speaker 5: I. I have to say no, I didn't see anything defined as misspending or that we went drastically over. I have to hand it over to our department heads and our city manager's offices. We are maintaining, I think the mid year identified where we didn't budget correctly due to accounting purposes for OPEB retiree health and we corrected that. So I would say that's one of the ones that we identified. And then there were some that the actual didn't come to what we budgeted which was franchise fees for example. So we looked at the trends more in detail. Not to say that the previous interim finance director did not but we, we are looking at the trends more in detail now.
[64:48] Speaker 1: And also keep in mind there's not a whole lot of fat in this preliminary draft budget. We, we've been very dutiful. I say as our city departments have really looked in to eliminating non essential contract spending or deferring those expenses. So this is a very, very disciplinary lean budget. So there's no thing such slush funds or anything else that we have discovered that's going on in our, in our operating budget. So this took a lot of work, a lot of hard work in scrubbing our budgets and trying to eliminate that deficit. I mean 2.3 million reduced.
[65:26] Speaker 5: Yeah.
[65:26] Speaker 1: Was pretty significant.
[65:28] Speaker 7: Yeah. No and I thank, I thank you Matt and assistant city manager and the department heads and working together to balance our budget budget. One last question when we do get to that point because we will get to that point of in the future when you consider the rank programs along with you consider those with, along with the yearly surveys by Dr. Manross besides the council.
[65:49] Speaker 1: Yes. So I mean again I'm going to be being a broken record to the council. We have to make data driven decisions always. It's very important when you're developing your policy going forward. So we're going to retool our council priority work plan to incorporate the priority based budgeting model. You'll actually start to rank your priorities in terms of programs that the community supports. We'll also continue to use the annual survey process with SRI to fuel some of that discussion with the council so that you have data or intel that shows, you know, if crime or illegal dumping is number one, well then that's a ranked priority that the council should acknowledge from your community coming from your survey process as a program that the community wants you to focus on. So we have to make those decisions. It's not about what we think would be great or what are what, you know, what might be the greatest idea that's currently buzzing in our Ear it has to be on data driven decision so that you're responding to the needs of your community. So this is going to be a profound change on your policy development. But it's going to start with the work plan and then trickle down to our individual departmental budgets to start budgeting based on those priorities that you, the council, establish.
[67:12] Speaker 7: And then, so most importantly, if the council tonight goes with your recommendation, we have a balanced budget. So I can sleep good tonight?
[67:22] Speaker 5: That is correct.
[67:23] Speaker 7: All right, good.
[67:24] Speaker 5: Well, I don't know if you'll sleep good tonight, but I'll just have to
[67:26] Speaker 7: say that it is as good as can be. Yeah, okay.
[67:28] Speaker 5: Definitely.
[67:29] Speaker 7: All right. Thank you, Madam Mayor. Thank you,
[67:34] Speaker 2: Vice Mayor Xavier.
[67:35] Speaker 4: I don't have any questions. This is a tremendous amount of work on the part of all the department heads and city manager. So it's quite impressive. It's a lot to think about and I'll add more later.
[67:56] Speaker 5: Thank you.
[67:56] Speaker 4: Thank you.
[67:58] Speaker 2: Thank you, Vice Mayor. And yes, I have, you know me, I have 150,000 questions. Maybe not 150, but I want to go back really quick, Matt, about what you said about how we rank the priorities. This is a new thing that we're going to do moving forward. But we did that last year where we ranked it. I remember, I was thinking about this the other day. I remember there was the beautification and there was another one that was ranked and it was council member Pineda and I had a disagreement about who had the most ranking and what should be first. And that was really. We already do that. So I'm not sure what new process you're considering that's different than what we're already doing. Because when we sit in that meeting, we listen to the priorities of the, you know, our constituents and people who are there within council. We talk about it, we, you know, deliberate and then we choose. And from that list that comes out of that brainstorming session, we choose what's the priorities.
[69:29] Speaker 1: So mayor and council to address the mayor's comment. So there actually is no prioritization or ranking in your work plan. The exercise we went through was to rank the top policies that you're going to add to the work plan. So that was the point of the exercise, was to make sure that you had consensus on what you wanted to add to the work plan for 25, 27 overall. The work plan does not have a ranking. So that's the thing that we're going to be focusing on. The priority based budgeting model is something that has to be explained in detail and we will do that. We do have a consultant that we contract with who's skilled at this. And it's going to take over a year to implement this from the Council's understanding of it down to the individual employed. Because it's going to change how we budget, how we prioritize and that we put a value on what we're actually establishing as community priorities. So there's a way for us to rank it by value, which the Council has to have a consensus on. So there will be an actual prioritization part of your work plan now. So I just wanted to clarify that. So, okay, we have had discussions in the past, but the, the voting that we did was just to add the top priorities to the existing work plan. So I just wanted to clarify that. So this is going to be a monumental change for us.
[70:59] Speaker 2: Okay. I was looking at the strengths that was outlined here. And. Can you explain this map? It says here that the reserves exceed local peer cities by 150% of general fund.
[71:22] Speaker 1: Let's get to the slide real quick.
[71:26] Speaker 2: Okay, that means that we have it, if I read it right, that means that we have more reserves on average of 150% more than any city around us. Is that what this means?
[71:38] Speaker 1: So, yeah. So when we did the comparison between the other west county cities during the PFM analysis, they did a comparison of all of our combined fund balances or reserves compared to the other cities. And San Pablo has the most resources in our reserves compared to other west county cities. So that was a report that came out of the PFM analysis. And then as was brought up at the stand committee last week, we're actually going to be undertaking a new consultant provider to update that financial forecast for this next year.
[72:21] Speaker 5: That is correct.
[72:22] Speaker 1: We're going to be doing this more regularly so that we can keep a very close monitoring of our reserve level levels as it compares to other cities and to look at the standard practices of GASB or GAP or whatever GFOA about the recommended thresholds for reserves so that we can have something that can be recommended the Council for Future Fiscal Resiliency Policy Amendments. So we do have healthier reserves compared to our neighboring cities.
[72:56] Speaker 2: And if we do, and I'm sure we're not the only one with the AAA rating. So the also I realized that I was. Because I was doing a little bit of the analysis is that currently. Can we go back to the, the reserve balances? Right now most of our reserves are in the catastrophic reserves and the oped. I think it's like 80%. Right.
[73:31] Speaker 5: Not the OPEB, the catastrophic reserve and the budget stabilization is that we are identifying. And also the casino revenue sustainability.
[73:41] Speaker 2: Yeah. So we're almost surpassing the catastrophic catastrophic reserve. We have 49.9% right now sitting as part of the. And we, and we, when we allocate funds, the unallocated funds, we take 50% of that and funds.
[74:08] Speaker 1: Yeah, it's 50% of your adopted budget per your fiscal residency reserve policy. So if we're going to modify that, we have to modify the policy. So what I'm saying is looking at all the fiscal management practices under GASB, GeoFET, GFOA or GAP or whatever, we will be working with a new investment, excuse me, independent consultant that we have, bringing them on to do the new forecasting model. And there may be some recommendations down the line about changing that catastrophic reserve level. Not today, but that's going to have to be a separate discussion with the council about your fiscal resiliency reserve policy. So 50% has been our standard since October of 2013.
[74:56] Speaker 2: Right. So at what point normally do cities say that there we have more than enough in each of these categories? Because each of these categories operate differently. Right. Because some of these operate where it's totally restricted and unflexible. Then there's some that are flexible that we can use it for other things. And I think 10% is the only thing that we have in terms of our funds that is flexible that we can use. The rest are restricted.
[75:33] Speaker 5: So technically everything is restricted per the policy around what it could be used for. So for example, for mid year, we utilized the sales tax revenue sustainability because we knew that there was going to be over $200,000 in revenue shortfall. We also identified using the casino sustainable sustainability reserve because we're identifying there may be a $900,000 shortfall going back to City Manager Matt Rodriguez's point. And your question is that there is no best practices other than GFOA, which identifies 30% of your operating budget should be in reserves at minimum. Having a consultant come in and do some comparables is the best way we would develop a best practice. I do want to be mindful is that we have some local cities, some a little further, that have barely met payroll and utilize their reserves and. Or bought a movie theater with their reserves and were not able to sustain.
[76:42] Speaker 2: So but that won't happen to us. Right now we are, we have a really healthy.
[76:48] Speaker 5: We have a healthy reserve.
[76:49] Speaker 2: I mean healthy now having. Which you know is at some point, when, when does the city get To a point where they say we have such good reserves, right, that we can reduce the percentage. So we'll keep it healthy, we'll keep it there. I'm not saying to spend it, we'll keep it there, but we won't keep funding it so that we can fund, give it to the operation operating account so that we can fund these other, what I would call a strategic investment in our city. Because I know that since I've been here, it has always been we rely way too much on the casino, right? And now we're up against this Vallejo casino that's going to come in. So what are we doing to mitigate and invest in our city so that more investments can come in? One of the ways that I see it, it's not about, I think I've been framing this whole idea of beautification incorrectly because it really is about investing in our community so that we can, people that come in to invest can say, wow, the city really invests in the community, in the community. And we are investing as well. It's just, this is another strategic investment, right? So that we can get more investors here. It also increases property value. It also, you know, it is just a lot of good investment. It's a great investment. Now, I do want to ask again, do we just wait for the consultant to tell us whether or not these percentages are correct? And it's not even so much the percentages as much as it is the dollar amounts.
[78:58] Speaker 1: So like I said, it's important to get a third party independent analysis to look at the rate of depletion on your reserves, because this is one time money and year to year the formulas. If we use a chunk of any of our reserves for operating costs, again, your credit ratings, credit rating agencies are going to monitor how much you're using of one time money to fund projects, which is why we're looking at the, the enhanced Infrastructure Financing district mechanism for this very thing about capital investment. So that's going to be the new mechanism we're going to use to continue with capital investment to incur more private investment into our community. So that's why we're creating that mechanism. Also don't forget, over the past 10 years, you've invested over 110 million through your bond financings and through one time funding as well. Well, to be able to fund all these city facilities that you've been building for the past 10 years. So a lot of that has to do with maintaining a healthy reserve and a high credit rating because we've bonded over the last few years, within the last 10 years to generate the bond proceeds that have built those new facilities. So everything's relative. Changing your operating reserve level arbitrarily is not recommended. Waiting for new revenue sources to come online to help the general fund is highly recommended.
[80:24] Speaker 2: Okay, Matt, I'm not asking for arbitrarily. Right. I'm not saying let's just do it. To do it.
[80:30] Speaker 5: Yeah.
[80:31] Speaker 1: I'm just saying.
[80:31] Speaker 2: Right. I'm.
[80:32] Speaker 1: You should rely on a professional, independent analysis to show if we did want to modify our fiscal resiliency reserve policy, this would be the analysis and this would be the recommendation. So I would just caution the council about using your operating reserves to pay for new capital improvements when we're really in this current fiscal condition until those new revenue sources come online.
[80:57] Speaker 2: Right. But I guess, I guess we're kind of not. See for me, I look at let's invest and we'll watch the money come in and you're saying, no, the money got to come in and then we invest. So I guess we have to really.
[81:14] Speaker 1: We've been investing. You've, you've got the house, but we're
[81:17] Speaker 2: in, we're in a loan. Right. Bond with that. A big loan with, with, with. It's beautiful. This building is beautiful as well. But just the, the simple. The, the major corridors are not right. And you know, I understand a CIP, we're going into $250,000 under beautification. But I want to, I kind of want to get everyone to start thinking this isn't really about beautification. It's really about investing in our, in our. Right. In, in the corridors, in the. In. In where people come in.
[81:58] Speaker 1: So that's what the big. So remember when we talked about the Enhanced Infrastructure Financing District in January? We're now entering the implementation phase and at your next meeting you're going to be doing a resolution of intention. That's what that EIFD mechanism is about. It's being able to generate your own tax increment to be used for capital investment for housing, AI infrastructure, street roads and bridges, city facility rehabilitation. The very thing you're talking about, enhancing our corridors. That's the mechanism we want to use instead of our general fund and instead of our CIP budget. Because that eifd, once we create it, will generate revenue that will induce private investment.
[82:44] Speaker 2: When are we going to get the professional to come in and look at our reserves and see if maybe we're not. Maybe a little reserve heavy while we're restricting spending money in our City.
[83:06] Speaker 1: Yeah, I mean, about that today. So we're actually bringing forward a proposal within the next month. I think we just received this cup of work.
[83:17] Speaker 5: And in addition to that, it's meeting with them so quickly, we could probably do it in within less than 30 days.
[83:25] Speaker 7: Can I, can I interject, Madam Mayor? So I really feel comfortable with having a healthy reserve now. Say for instance, the. We had to lay off do layoffs. Can we use the reserves to, to cover that cost?
[83:40] Speaker 1: So that would be a separate discussion. And like I said, as a city manager, that's the last measure we would ever consider. The balance of budget trying to lay off our, our people. So like I said, we have to go through some pretty substantial analysis identifying how we want to be staffed in our individual departments.
[84:00] Speaker 7: Yeah.
[84:01] Speaker 1: And then there's also collective bargaining with that where we have to meet and confer with the affected employee labor unions on those positions that are represented. So it's, it's a long process because
[84:13] Speaker 7: I was, I was getting to maybe creating a beautification fund.
[84:18] Speaker 2: So we do. There's a $250,000 and I'm gonna get to that when the CIP and I. And I want to rephrase beautification to be really more about investing because that's what it is. It's not so that we could look, you know, it's like, I don't know, beautification is too superficial when in fact it's really strategic, is strategic thinking so that our city could look really nice and people will be interested in, in buying homes here or staying or in investing, coming in and having their businesses. Because now we're gonna, we're going to have a lot of storefronts, right? We're going to have for sure that one right here on San Pablo Avenue, the new apartments down at the bottom, there's going to be a bunch of commercial space. So if people are driving in either from the Robert Miller or here, San Pablo Dam Road, it's not appealing for me, it is not appealing. If I'm going to spend, if I'm going to my business, have a business here and spend four or five thousand dollars a month on just rent or lease leasing. I wanted to look a little bit. I want to know that when my customers come in, it's going to be going to be appealing to them. It's not going to look like it. Poor people or poor. Poor. Not poor people. That it's poor in general. So I'll leave that point there. I have another question. The summary of reductions to city Programs and service delivery. I have a question about the, the West County USD fiscal cutbacks and uncertainty. I just have a question on that.
[86:24] Speaker 5: I was going to move to that slide. Thank you.
[86:29] Speaker 2: I just want to understand when it says here that 25% cut to beacon Community School Initiatives. Initiatives, are we going to supplement that until they can?
[86:45] Speaker 1: No.
[86:46] Speaker 2: No. Okay, so don't.
[86:47] Speaker 1: Yeah, we don't. So remember at this point in time.
[86:50] Speaker 2: Yeah.
[86:51] Speaker 1: In April.
[86:52] Speaker 2: Right. So we're not getting any revenue to. Or any matching funds, if you will,
[87:00] Speaker 1: for next fiscal year 26, 27. We already have our contract services pretty much locked in. And I know Greg's here, he can kind of explain this with bacr. So BACR is our major contract provider and they help to sustain the Beacon Community Schools initiative. We also have our MOU with the school district that helps to, helps to fund our Beacon Community School directors. So we are making some modifications for next year based on the school district's capacity. Now they're working through their budget. They've made some promises to us about funding our MoU for next year, but again, they haven't adopted their budget yet. So we're kind of in this holding pattern with them. So going forward, like I said, if we proceed with a conservative approach, you know, 20% reduction, 25% reduction, and we come back after the audit and after the mid year cycle and we see that the District 1 has adopted their budget for 26, 27, we see if this new legislation materializes to help fund full service community schools, which it looks like it might get put in the state budget. We won't know that till September. We can modify our budget at mid year to add some of these resources back in, which definitely will be augmenting the BACR contract and also hopefully fully funding any other program that we partner with on the school district level. And Greg can kind of talk about some of this.
[88:31] Speaker 6: Yes, thank you City Manager Rodriguez and a nice job in framing all of that. There's also, is the measure S reduction, a natural reduction that is going to take place where that's going to reduce from a half cent down to a quarter cent. So we, we are anticipating that. And this is step one of that. Everything that Matt just said is accurate, but it also is us needing to prepare for that reduction that's going to come regardless. In years past, the city has been made whole and we were able to absorb that shortfall. So seeing our numbers, seeing the projections, we're anticipating that shortfall and we're saying, hey, we need to, we need to kind of protect our own. And we're going to, we're going to stay in this framework. Right Now, I've communicated this with Bacr. I've also communicated this with Familia Zunidas as well. There's potentially other funding mechanism that city manager has referred to. We're also looking at the possibility of measure X which is a county funded proposition, which. Or shoot me a tax measure that funds some alternative programs in other schools. So I've asked those nonprofit groups to look into that as a possible funding mechanism to bridge the gap until we
[89:41] Speaker 5: can figure out where.
[89:42] Speaker 6: Where things land with the governor's budget and things like that.
[89:46] Speaker 2: Okay. Okay. Thank you, thank you, thank you. And then just help me understand where it says the next page. I think it is the budget overview by biennial budget over you overview for fiscal year 26 and 27. That one, yeah, that one right there. No. Yeah, that one. Yeah. So where it says the fiscal year 20, 25, 26, the adopted, there's going to. If, if, if everything, we have three, three more months before the year ends, right?
[90:27] Speaker 5: That's correct.
[90:28] Speaker 2: Two or three more months. If everything stays as is and there is a surplus after the audit, this then becomes that 1 million 575 becomes the unaudited fund. If that's what if everything stays the same. Right. It's not budget versus actual. It never is. So, you know, I'm not, I understand this, but just for conceptual, so that I can understand if this holds at the end of this year, will this be the one that's categorized as an unallocated fund so that then it's allocated to the reserves?
[91:18] Speaker 1: So. So. Yes.
[91:20] Speaker 2: Yes. Okay.
[91:21] Speaker 1: But remember, we don't close the books until.
[91:24] Speaker 2: Yeah, no,
[91:27] Speaker 1: because our casino revenue disbursement for the end of this fiscal year, we won't know that until after June 30th. And then Arturo has to go through the process of doing the year end audit with Maze. And that's when your actual is produced. And so your ACTFR will identify the audited fund balance, which is basically the year end surplus amount.
[91:49] Speaker 2: Right, Right. I understand that this is just an estimate. This is just what it, you know, possibly could be or not. We still have to go through the audit. We still have to go through all of that.
[92:00] Speaker 5: But just say so I just wanted to find is that that 1.5 million was actually a surplus based on the budget. What you're identifying is that any actuals versus budget, if any surplus. Yes. Going back to your point, mayor, proponent of rado and City Manager Matt Rodriguez's point, any surplus would go into the fund balance. That is correct.
[92:23] Speaker 2: That is correct. Okay. Okay.
[92:25] Speaker 5: And I do want to mention we're in a great position because as City Manager Matt Rodriguez identified, we actually closed the books mid July, although we review the books all the way up to October, late October, that during this time frame, if we get this consultant to come in and review our fiscal resiliency policy. As you all may recall, it's around December, January, where we're now allocating the funds into the reserves. We have a better picture even before that.
[93:01] Speaker 2: So do you anticipate that we're going to get this consultant before then? So that if, if, if, if they're seeing that I restricted reserves, because although they are all restricted, there's some that are. That we can. There's still, there's some flexibility in there. Would you be able to bring it back to the council before the unallocated reserves?
[93:29] Speaker 1: So, no, it. I would. I would be more supportive of us finishing off the ACTFR and have the consultants prepare to analyze while we're finishing the actor so that everything comes to you in January like it usually does, so that we have updated information. You'll have your audited fund balance. You'll have your FRP policy by formula updating that based on what's available. And then our consultant can assess and provide some recommendations. You don't want to do it before your. Your audit's completed and the act first. Done.
[94:05] Speaker 5: Agreed.
[94:10] Speaker 2: Okay. So going to the expense summary, I'll fund from 2627 and fiscal year 2728. Why is there a reduction of 1% in. In staff when everything goes up, what do you see? Where were you? Where were you?
[94:36] Speaker 5: You're talking about the bar. Sorry, The.
[94:38] Speaker 2: Not the bar.
[94:39] Speaker 5: This one.
[94:39] Speaker 2: That one. Yeah.
[94:40] Speaker 5: I should say the.
[94:41] Speaker 2: Yeah, just. It doesn't have to be a long explanation because I'm sure by 2728 there's going to be adjustments.
[94:48] Speaker 5: It's because the increases is more in service and supplies. So that increase therefore changes the percentage
[94:57] Speaker 2: in services and supplies.
[94:59] Speaker 5: Correct. So if we look at the second row under the blue row, Services and Supplies increases 1.2 compared to the personnel increases a million. Because it's comparing the 2720 is comparing to 2627. When 272627 is comparing to 2526.
[95:20] Speaker 1: Right. And also you have to keep in mind that all of our employee labor mous end on June 30, 2027. So we'll be initiating all of Our collective bargaining beginning in early 2027. And so we're hoping to do another round of multi year employee labor MOUs again. So right now we have a placeholder for COLA in 2728 because it hasn't been negotiated yet. So our personnel costs may actually go up.
[95:49] Speaker 2: Yeah, that's what I'm thinking.
[95:50] Speaker 5: Thank you for that articulation.
[95:52] Speaker 2: For sure. For sure. This isn't going to stay.
[95:54] Speaker 1: So there's a place over there, but we don't know where that's going to land.
[95:57] Speaker 5: Right.
[95:58] Speaker 2: Yeah, that one seemed a little, just a little off for me because I know salary, even if we stay in the same, the same number of people, everything increases benefits, all of that. So. And then services and supplies by department. And I think I asked this question but I want to be a little bit more mindful I guess on the. Under the clerk. 1330 and 1340.
[96:37] Speaker 5: Yes, ma'.
[96:38] Speaker 2: Am. Where were they previously? What budget line item were they?
[96:44] Speaker 5: They were in the 1310 city manager.
[96:47] Speaker 2: 1310.
[96:49] Speaker 5: So that's why you see a reduction and that variance.
[96:53] Speaker 2: Yep, yep, yep, yep. Yeah. And then the multi department general government, that's. I mean that's significant. Six million dollars.
[97:03] Speaker 5: Yes ma'.
[97:04] Speaker 8: Am.
[97:04] Speaker 2: What's that?
[97:05] Speaker 5: And I'll, I'll give a detail which is that if you recall in the standing committee in number 1110 city council, you see a significant reduction of 3.8 too.
[97:18] Speaker 2: Yeah, yeah, yeah.
[97:18] Speaker 5: That was reduced because there should not be contracts like animal services or library and city council. It should be in department wide obviously because we're supporting that. So they were also in not, I would consider not the appropriate spend category. It was community services at some point and we moved it to professional services. So this is why you see a significant increase in the 1430 multi department. In addition, we moved all our IT cost into multi service department as well. So we. Admin is able to monitor this particular department a lot more thoroughly and make sure that we don't have multiple software and services in different departments where IT and admin is not reviewing that we need need to add accounts rather than more and more software accounts.
[98:17] Speaker 2: Okay. So that the account 1510, a portion of it also went to 1430.
[98:25] Speaker 5: That is correct. So that's why you see.
[98:27] Speaker 2: Because it's easier for you to monitor than one line item. Really.
[98:30] Speaker 5: Yes, because how do you do your trends?
[98:32] Speaker 2: That. How do you. Because I do trends. Right. When I look at my financials through the organizations that I run, I look at trends. Right. Per department. But this 1430, it's all of the departments.
[98:51] Speaker 1: Right. So I think what Arturo is alluding to is that we're still exploring the way to kind of do internal cost methodologies, which is kind of like applying services across city departments instead of budgeting it individually in every city internal service fund. Yeah. So this kind of consolidates everything into a multi departmental general services account so that we can have a total accounting of things that are not very departmental specific, but that provide internal services to everybody. So we're actually going to be looking at a. At a better internal cost methodology on how to we do IT services, for example, because everyone has IT services.
[99:34] Speaker 2: Sure, for sure.
[99:36] Speaker 1: Also, Arturo mentioned the intergovernmental contracts with our county agencies. So that would be an appropriate location for those contracts. So because we don't have an animal control department, we don't have a library department, those are all done by contracts. So there's. That's the justification and the rationale why we did the 1430 and why it's increasing so that we can keep a close contact on all those costs.
[100:02] Speaker 5: And if I may see major mayoral judges, I'll give something also, like tangible. What I was looking at is copiers. So copiers, an apartment may have a sharp or Caltronics is another one. And so we want to make sure that everyone is using one agreement to maximize our efficiency but also minimize cost. So it's really looking at all our cost and making sure that we're maximizing the users in that software service and minimizing additional cost. And some contractors actually love to have split departments because they get to charge a certain amount to those departments compared to others rather than having one service agreement.
[100:48] Speaker 2: Right. Okay.
[100:49] Speaker 1: So it's just for efficiencies and monitoring.
[100:59] Speaker 2: There's not a question. But I'm going to trust that you guys will still be able to look at trends. Right. So the different categories that you're posting all the expenses into this multi department. Because it could get lost when you're absolutely right.
[101:19] Speaker 5: The priority based budgeting, when city manager Matt Rodriguez identified that that is a great methodology and it is all about your actuals and your trends compared to your budget. And this is really what it is about. It's preparing for our priority based budgeting.
[101:41] Speaker 2: Okay. Okay. Those are my questions. They are. I'm glad. I'm sure you guys are happy that that's all my questions.
[101:59] Speaker 5: I ate my Wheaties this morning. I'm ready.
[102:01] Speaker 2: You know, I mean, as part of council, we need to make sure, especially now with everything going on and not to say I really Trust, Matt. I trust that you know what you're doing. I trust that these questions come out of two things. Me trying to better understand, but also for the community to know that, yeah, we are not just saying, yes, yes, you're doing the right thing, but actually going in and asking questions. Especially right now with the climate of fraud. I want to make sure that, you know, it's recorded that we're asking questions, that we're going, and that we're, you know, doing all of this to the best of our ability. Right. So I don't mean to, you know, offend anyone or with the type of questions that I ask or anything like that, but I think as, as council, it is really, really important that we stay astute and understand what really is going on instead of just saying yes. Good. So thank you so much, Arturo.
[103:02] Speaker 5: We welcome those questions. Thank you.
[103:04] Speaker 2: All right.
[103:04] Speaker 1: All right, so we can. We can take a quick break and then transition to the CIB budget presentation
[103:11] Speaker 2: before we approve anything.
[103:12] Speaker 1: Take action at the end.
[103:13] Speaker 2: Okay. All right, so it's 6:45. We're going to take a five, five minute, five minute break.
[103:28] Speaker 1: Recording in progress.
[103:46] Speaker 2: Okay, roll call please. We are back in session. It is 6:54.
[103:50] Speaker 3: Council member Cruz.
[103:52] Speaker 2: Here.
[103:52] Speaker 3: Council Member Ponce. Council member Pineda. Vice Mayor Xavier.
[103:58] Speaker 4: Here.
[103:59] Speaker 3: Mayor Pabone Alvarado.
[104:01] Speaker 2: Here.
[104:02] Speaker 3: Council Member Cruz, Vice Mayor Xavier and Mayor Pabone Alvarado are all present in council chambers. Council Members Ponce and Pineda are absent.
[104:18] Speaker 2: Okay, next item.
[104:25] Speaker 1: Okay, so now we're here to present our two year CIP budget for fiscal years 27 and 27 28. So Matt Brown, our senior civil engineer, will be doing the honors.
[104:39] Speaker 9: All right, thank you everyone, Council members and staff.
[104:44] Speaker 10: Moving forward, I think sometimes it's best to remember some simple things of why we are here. One of the things to remember,
[104:59] Speaker 2: if
[104:59] Speaker 8: I can get the button to work.
[105:04] Speaker 9: There we go. Okay.
[105:06] Speaker 10: Infrastructure is the backbone of economic growth and the foundation upon which societies thrive. If you have no infrastructure, you will have no society. You know the basis. Water, wastewater, roads. That's what made us great.
[105:25] Speaker 1: So,
[105:34] Speaker 10: Okay, going back and looking at some of the things that we've achieved over the last few years. Projects completed. The Rum Rail complete streets project. The community center roof replacement. The citywide trash capture device installation. Happy Friday. Park. The Sutter Avenue Green street project. We've done our slurry seal. We've done some creek work with the Wildcat Creek root rod repair, the large full trash capture device that we installed over on Willow San Pablo Dam Road. We did a Sinkhole repair, emergency repair there. We did another emergency repair up in Leroy Heights. We had a sinkhole repair that we fixed there. And we maintain ongoing traffic studies. Also projects that we have obviously going on is the new police headquarters building next door. And we're working on the ADA transition plan. And what have we gotten for this stewardship? Well, some of the things we've gotten national awards, we've gotten local awards, state awards for the Rum Rail Complete Streets Project. We've been recognized nationally at APWA for Project of the Year. In 2025, we won state awards for the Rim Real Complete Streets Project for
[107:05] Speaker 9: Casca, the Outstanding Stormwater Capture and Use Project for Rumrell, California League of Cities
[107:13] Speaker 10: for outstanding Local Streets, and award for Rumrell as well.
[107:18] Speaker 9: But not just Rumrell.
[107:20] Speaker 10: We got the.
[107:22] Speaker 9: We had the sustainability, the APWA Northern California Sustainability Award for the Public Works
[107:30] Speaker 10: Department for our stewardship of the environment and the projects that we do. And most specifically, our associate engineer, Jimmy Zhao, was awarded the APA Northern California Chrysalis Award, which basically kind of recognizes excellence in engineering. I say this because with all the budget things that we're going through, it's kind of important to realize that you have a department that is doing a lot of good work and continues to do so. So let's look at some of the major projects that we're going to be taking on or continuing. We have the McNeil park project, the Giant Road Bridge Repair Project, the San Pablo Avenue Bridge Repair Project, the Broadway El Portal Bicycle Path and Streets project, The Gateway, the i80 Gateway Improvement Project, the Rum Rail Sports Park Turf Replacement, the Giant Road Paving Project, the Contra Costa Mobility Hub. These are all large projects that we've used in combination with grants to implement. One of the first projects we're going to discuss is the Giant Road Bridge repair project. Giant Road Bridge repair. This is right there, just south of the intersection of Par Boulevard and Par and Road 20, where those intertwine and meet Giant Highway. The thing to remember about this project is this bridge is just out in the elements. And so it's a resurfacing, it's a restoration of surface on the bridge itself. Again, this is. We already have the money for this. We're just actually doing the work in
[109:35] Speaker 8: the next couple of years.
[109:42] Speaker 10: Next project.
[109:43] Speaker 9: Oops, we skipped one there.
[109:46] Speaker 10: The Giant Road pavement project. Now this, this is the paving project on both sides of the bridge. And we're doing the work at more or less at the same time. We're going out there bid these projects on a similar time Frame. And we're looking to add, you know, put money forward of $100,000 in the next fiscal year. But this pretty much secures a new surface on the road from basically the beginning, from the city limit to the north to the city limit in the
[110:18] Speaker 8: south on Giant red.
[110:31] Speaker 7: There we go.
[110:34] Speaker 10: The San Pablo Avenue Bridge replacement Project. This is a huge project. This takes the existing bridge, which is 100 years old. We're going to demo the bridge. We're going to put in a new bridge structure. And that's one of the most interesting configurations of an intersection in the East Bay where you have Road 20, you have 23rd street, you have San Pablo Avenue taking a turn as you go through this project. The design of this is quite complex. And with this design, we're trying to incorporate relocation of the monuments on the arch, moving it from the location that it is now to the bridge, make it a little more prominent. And so we are looking to use a lot of different funding for this, including General Fund Fund 130, which would involve some of the design and funding from the archway and then road funding
[111:40] Speaker 9: that that Public Works has access to.
[111:46] Speaker 10: With this project, we still have a shortfall. We're pursuing grants for this money. Grant funding has been difficult to achieve. We are diligent and we're looking to utilize Safe Streets for All and ATP project money for this, for this project.
[112:09] Speaker 1: And keep in mind, when we have the EIFD mechanism up and running, we can use a portion of that fund to help close this gap. So that's another part of why we're doing the EIFD mechanism. As for street, road and bridge work as well,
[112:28] Speaker 10: the next project that we're taking on is McNeil Park. This is an ongoing project, as many as the council's probably well aware. This is the site next to Contra Costa College. That was a former school site and was the location of many, many unhoused activity. And that's the site has been demoed. Right now it's pretty much an empty lot. And we are converting this to a soccer park and have other amenities there as well. We're waiting the outcome of a grant for this one for $3 million. That's going to tell us we're going to move forward with the park. It's just what amenities are we going to implement right away and what we're going to have to stage in time. Next project is the Rum Rail Sports park turf replacement. This is what happens when we have a resource that people love. This sports park was built on an old brownfield site, as I like to say, there's methyl ethyl funk underneath, but it's got a concrete cap and is secure. And with this we are looking at the turf, using the same kind of turf at McNeil here. And that's what we're working on, that design to try to make sure that
[113:59] Speaker 9: we have one type of maintenance, one
[114:02] Speaker 10: type of cross section so it's easier for us to maintain. Next project. This is the i80 Gateway Improvement Project. Now this is a two phase project. We broke it up in two phases because we found that the sidewalks here are cracked pretty severely. So we're doing a lot of sidewalk work and this is going into that investment in the visual aspect of the city, that beautification and stewardship that I think that you're looking for. Where we're going to fix the sidewalks first, get a nice clean sidewalk, new look, fix up the ramps, make it more approachable and usable for the public and then go back in phase two and work on the streets. And this is coming, this is a project that is going to be coming to council within at the next session. But the funding we're asking for is for phase two. Again, we're looking for some general fund and looking to use roadway funds. The next project is the Contra Costa Mobility Hub. This is Mission Bell Drive up to the roundabout by where the, the Contra Costa College is. This is a means to make bus multimodal service, improve multimodal service. And basically it's tied with other projects that where we have the ability to try to improve bicycle and bus access
[116:04] Speaker 9: and pedestrian access for the public where they, where they're going to use it.
[116:09] Speaker 10: Because a lot of people that use the bus, go to college, cost college. So I mean it's one of those things where putting the money where it's going to be used. The next project is the Broadway El Portal project. Now this is in close, very close functionality if you will, and location to the mobility hub. In fact, these projects at one time were one project, but given the funding we separated them. This has an education component to it. Unlike most projects that we do. The some of the. We're actually going to work with schools and go into the schools and have a traffic safety program where we try to teach students the rules of the road and how to bicycle, how to bicycle more safely, things to give them strategies on how to negotiate traffic. And that's a huge part of this project and something that most roadway projects don't consider. So again, we're looking to use roadway funding and general fund and A lot of the general fund will be going specifically for that education part. So those are the major projects that we're working on.
[117:44] Speaker 9: And that's about eight projects and that's barely half of what we do.
[117:52] Speaker 10: But you can see it's about $60 million worth of projects. We're looking to get less than a million dollars of general fund over the next budget cycle. Each year of the budget cycle we will be using Fund 130 money. We're using a lot of the money that council gives us to go out as matching funds for grants. Now then there's the minor projects. The minor projects include the fiber, the fiber upgrade to the PD building. This is taking fiber optic line from the old PD site to the new PD headquarters. We're using Fund 130 money for this. And then there's the Senior Center H vac repair again, a facility that is well used and a facility that really needs stewardship. And with this project we're also going to, while we have the senior center down, do some, some other upgrades, some other maintenance, heavy maintenance upgrades with this at the same time. Because if you have a facility down, you want to do as much as possible when it's not operational. The annex conversion Once the police department moves into the new headquarters, the old fire station that they were using as an annex, we are looking to convert that for the streets department for their use. And we know that our existing courtyard is pretty cramped and trying to move
[119:43] Speaker 9: some staff and some equipment out of
[119:45] Speaker 10: that facility at the Corp yard into the annex is just. Will allow us to work more efficiently and allow us not to have to
[119:55] Speaker 9: back vehicles up to access other vehicles in the yard.
[120:00] Speaker 10: Additionally, we have the Adobe utility connections with us maintaining the Adobe structure. We are currently on temporary power and so as they build the next phase of Alvarado Gardens, we need to establish a more permanent power supply for the Adobe. And as we venture into its next phase of use, we need to secure that facility can be operational. The San Pablo Bridge parapet wall repair. We've had a series of people hit that bridge and before we replace it, we have basically what is known as K rail up in one lane. We're going to be doing a small repair to the bridge structure so we can get back to full, full lane width of the road in front of the bridge. But this is a small project and we know we're working on its replacement. So we're not, we're not going to
[121:06] Speaker 8: do massive, massive repairs to the bridge.
[121:10] Speaker 10: And then there's the, the city wide beautification plan. Now, this is a placeholder value. We know that we still haven't established what beautification projects will be completed. You know that we have a list
[121:25] Speaker 9: of things we'd like to achieve.
[121:27] Speaker 10: And so we have assigned a budget to this that at your discretion and at the availability of funding, may change. So those are the projects for 27, for 28 fiscal year 28. We have the Princeton Plaza stabilization. The hill behind the Raley shopping center. We are going back there. The hill sliding. We know it. We monitor. Sometimes we have to drill more bore holes to determine, put in seismic monitoring.
[122:09] Speaker 9: So that's money for that seismic monitoring.
[122:13] Speaker 10: The Love Grove pavement project. Again, one of the core things that public works does is pave roads. And an area that needs major pavement is the Love Grove area. This is Love Grove and Stone, just west of San Pablo Avenue, right by the Jack in the Box. East Bay Mud has done some work there. They've given us some money towards this project.
[122:38] Speaker 9: That is the other money of 133,000
[122:44] Speaker 10: of that of that budget line. We will mostly be using road funds for that, but they gave us money in lieu of doing trench paving there final trench paving, knowing that the surface of the street is in such a state that we'd just be ripping out
[123:02] Speaker 9: the money they put in to do the new surface.
[123:05] Speaker 10: So it was more, it was, it was better stewardship for them to give us the money and us incorporate that into paving ourselves. Then we have the Leroy Heights storm drain repair. The Hayward fault runs right through Leroy Heights, and we have a storm drain line that runs right over the fault. And so over the years, storm drain lines may have shifted. This is money to investigate and repair storm drain lines in that vicinity. And again, we have the beautification plan. So in, in summary, over the next two years, we have basically $61 million worth of projects, about 17 active and a good, good. Nearly 50% of that is funded by grants that we are actively trying to achieve. Unfortunately, some of it is unfunded at this moment. But we use Rhodes funding. We use Fund 130. We use basically every penny that we can to go out and do the work that, that you have prioritized. And at this moment, we have four project managers.
[124:38] Speaker 8: So it's, it's, it's a lot for small staff.
[124:45] Speaker 9: And if you have questions, I am. It's what I'm here for.
[124:49] Speaker 2: Thank you for the presentation. And do we have any questions, public comment, public speakers?
[124:58] Speaker 3: No, we do not have any.
[124:59] Speaker 2: Okay, perfect. Council member Cruz, do you have Any questions?
[125:04] Speaker 7: Thank you for that presentation.
[125:08] Speaker 10: So.
[125:08] Speaker 7: And congratulations for all the, the awards that you received. Well, we've received and the grants that you've applied for and also received. My questions are when we're replacing our bridges, usually they're homeless individuals underneath those bridges. What are we doing to assist them with housing or other resources to improve their livelihood? Do you know?
[125:37] Speaker 9: Yeah.
[125:37] Speaker 10: Right now we're still in the design
[125:39] Speaker 9: phase of the bridge replacement project. And really there's only one bridge that we're.
[125:44] Speaker 8: We're looking at replacing right now, and that's the San Pablo Avenue Bridge.
[125:48] Speaker 9: And we will work with the existing groups that we work that, that the
[125:53] Speaker 8: city's worked with for all of the. The homeless relocations. So we're just going to keep standard policy on that. That project is as, as we get
[126:04] Speaker 9: closer, we'll, we'll take a harder look at that one.
[126:07] Speaker 7: Okay.
[126:08] Speaker 8: But until we have the design complete and we have funding, it's. We're kind of in a holding pattern for that.
[126:15] Speaker 1: Yeah, we have $12 million shortfall. So it's going to be some time before we get to construction. So when that, when that time comes, you know, through, through pd, the chief can talk about this. We have our core homeless outreach services contracts that will help us to relocate those homeless individuals if there's, if there are some underneath the bridge before we start construction direction.
[126:36] Speaker 7: Okay. For like the Giant Road and was it Giant Road and par. Yes, that's next to the bridge of the Railroad.
[126:47] Speaker 5: How you.
[126:48] Speaker 8: Yes.
[126:48] Speaker 7: Collaborating with them to.
[126:51] Speaker 9: That is why.
[126:52] Speaker 8: That is part of the reason why that project wasn't.
[126:55] Speaker 9: Hasn't been completed earlier because the railroad had some requests from us that were
[127:04] Speaker 8: outside of our jurisdiction.
[127:05] Speaker 7: Okay.
[127:06] Speaker 9: Because of the proximity of, of Richmond.
[127:09] Speaker 10: The boundary of Richmond.
[127:10] Speaker 2: Yeah.
[127:11] Speaker 10: And the boundary of Saint Pablo are
[127:13] Speaker 9: such that they were asking for some requests that we could not agree to
[127:18] Speaker 8: because they were outside of our jurisdiction.
[127:21] Speaker 7: Okay.
[127:22] Speaker 9: So we kind of, we cut the scope back a little bit so that
[127:25] Speaker 8: we could focus on the elements that,
[127:28] Speaker 9: that are in our jurisdiction. But that, that is a location where we do not. The, the work is on the roadway surface, not underneath.
[127:40] Speaker 7: And that's, that's from, that's from Brookside down all the way down to say, Giant Minor Avenue all the way.
[127:47] Speaker 9: The paving project.
[127:49] Speaker 8: Yes.
[127:50] Speaker 9: So you have the bridge project.
[127:51] Speaker 10: That's just the bridge and the transitions on either side. And then you have the paving project, which is the transitions to the roadway, as you say, south to Brookside and north to Minor.
[128:07] Speaker 7: Okay.
[128:08] Speaker 10: So it does incorporate that entire run.
[128:13] Speaker 7: Okay. So and also when purchasing the turf for Realm Rail and McNeil park, do you, do you plan to get the same company for that and get a better cost?
[128:24] Speaker 10: Like not only, not only the same company.
[128:26] Speaker 9: We're trying to keep the designs the same too.
[128:30] Speaker 10: And this is again, the emphasis is to the unity of maintenance, the unity
[128:37] Speaker 9: of training our staff to maintain the vehicles and the equipment that we purchase as long as we can keep the design similar.
[128:46] Speaker 10: We're hoping to get that long term
[128:49] Speaker 9: stewardship, that long term management of costs
[128:52] Speaker 10: by not have to implementing.
[128:54] Speaker 9: Be implementing two different types of treatment going forward.
[128:59] Speaker 5: Right.
[129:00] Speaker 1: Because there's lots of artificial turf companies out there. So we don't want to have multiple products on two different fields. You want to have the same. So our maintenance division can handle the maintenance in the process more efficient manner. So.
[129:13] Speaker 5: Right.
[129:13] Speaker 1: And remember at the last councilman, you just modified the design contract for CSW Stro to do the artificial turf study for whatever applications are going to be applied at both facilities.
[129:27] Speaker 7: Because I'm assuming on those field soccer fields, there's more wear and tear in certain areas like the penalty kick and other areas. So how do you focus on those areas to make sure they're not being worn down sooner than later?
[129:42] Speaker 10: That's why CSW Stuber Stro is doing its study.
[129:47] Speaker 8: That is what we're, we're looking for that recommendation.
[129:50] Speaker 7: Okay.
[129:51] Speaker 8: And so that's, that's the plan.
[129:56] Speaker 7: Sounds good. Okay, that's all the questions I have. Thank you.
[129:59] Speaker 2: Thank you. Vice Mayor.
[130:02] Speaker 4: Yes. On San Pablo Dam Road, on the Gateway improvements.
[130:07] Speaker 8: Yes.
[130:08] Speaker 4: Like for sidewake, sidewalk construction, etc. Will Val I 80 will the overcrossing project impact what you've already done after you do it?
[130:25] Speaker 9: We have adjusted the scope to try to minimize that as much as possible. But the area in front of Denny's
[130:35] Speaker 10: we're going to do up to pretty much the on ramp.
[130:38] Speaker 8: So in front of Denny's on the
[130:40] Speaker 9: other side, we're pretty much just starting
[130:42] Speaker 8: at the pedestrian curb ramp that's closest
[130:46] Speaker 9: to Jack in a Box. There will be. That may change if CCTA does their project is they're going to increase their right of way and change the alignment. But the majority of the work is to the west of that. And so yes, there's going to be
[131:09] Speaker 8: a small part of the project where there's going to. We may be putting in something that does get ripped out, but we don't know exactly when CCTs go get their funding.
[131:22] Speaker 4: Yeah.
[131:23] Speaker 9: So if it's, if it's, you know, if it's two years, we might have done something where we could have maybe
[131:32] Speaker 8: held off on that.
[131:33] Speaker 9: If it's 10 years, then we have 10 years of use out of it. We don't, we can't judge when CCTA is going to get their funding in order to do their projects.
[131:46] Speaker 8: So it's.
[131:48] Speaker 9: Sometimes you, you have to spend the
[131:52] Speaker 10: money where it's, where it's needed and
[131:54] Speaker 9: know that this may change.
[131:56] Speaker 4: I'm hoping not 10 years.
[131:59] Speaker 9: Yeah, yeah, I am too, but. But, you know, I don't know. My crystal ball isn't good enough to
[132:07] Speaker 8: tell me what, what they're going to be able to achieve in one.
[132:12] Speaker 1: And keep in mind that our segment that we're doing our phase one on, which is coming to you at your next councilman for award, it's been long overdue. We have to take care of the sidewalks, the street meetings and landscaping. The paving is terrible right now, and if we continue to delay it, we put the city at significant risk and liability for potential claims. So we have to start the work and get that segment done and then hopefully ccta, you know, will do their portion with the bridge over crossing and everything else soon. But for us, we need to move forward because it's long overdue.
[132:48] Speaker 8: Right.
[132:48] Speaker 9: Again, we've. We've been focusing most of the design
[132:51] Speaker 8: on that to the area west of Ventura. So that's.
[132:58] Speaker 9: That's the majority.
[132:59] Speaker 8: That's ours.
[132:59] Speaker 9: That's the majority that even if CCTA
[133:02] Speaker 8: gets their funding, won't change.
[133:06] Speaker 7: Right, right.
[133:07] Speaker 8: So.
[133:07] Speaker 1: And there's going to be some project impacts on traffic flow. So we're going to have to work with our future contractor to make sure that we still have traffic access because we don't want that to impact Casino San Pablo because obviously if they're impacted, that means less revenue for both them and us. So we need to work on that.
[133:28] Speaker 5: Yeah.
[133:30] Speaker 4: And speaking of ccta, my next comment is the contra costume mobility hub at the college.
[133:39] Speaker 8: Yes.
[133:39] Speaker 4: That's on CCTA's list of mobility hubs. And what they've been talking about for other locations like Walnut Creek Bar and stuff, is not only the getting to transit, but like improvements of coffee shops, places where people will hang out.
[134:04] Speaker 8: Right.
[134:05] Speaker 4: So I don't know what's in the future for there.
[134:09] Speaker 9: Yeah. Where our part of this project is
[134:13] Speaker 8: being located, I'm not sure because we're trying to maximize the hub that exists on the campus,
[134:25] Speaker 9: but it would serve
[134:26] Speaker 10: to revitalize that area between,
[134:31] Speaker 9: between College and El Portel.
[134:35] Speaker 10: Where, like, the old showers was, where the.
[134:38] Speaker 9: Where the paint store is.
[134:39] Speaker 8: And that block would definitely improve.
[134:48] Speaker 4: And one other thing. On Broadway, El Patal, I can't wait for bike lanes, because lately when I'm walking, there are e bikes on the sidewalk. I've been so close to being hit several times, and yesterday this young guy comes from behind me. Even all around on an E bike.
[135:20] Speaker 7: Right.
[135:21] Speaker 4: Those things go fast.
[135:23] Speaker 8: Some really do.
[135:24] Speaker 4: So I was thinking, I can't wait for the bike lanes.
[135:28] Speaker 10: We're working on it. We're trying to get the funding on
[135:31] Speaker 2: El Portal and Broadway. You said this is.
[135:35] Speaker 9: This is Broadway from. Basically from 11th, basically all the way
[135:42] Speaker 10: all the way through.
[135:45] Speaker 9: And the. The El Portal part will go and
[135:48] Speaker 8: meet the existing bike lane at church. So that.
[135:51] Speaker 9: That entire S bend.
[135:53] Speaker 2: Yeah.
[135:53] Speaker 9: On El Portel.
[135:54] Speaker 2: Yeah.
[135:55] Speaker 10: And. And then on Broadway for its.
[135:58] Speaker 8: For its alignment.
[136:00] Speaker 4: It's bad enough when they're coming towards you, but when they come from behind and you.
[136:05] Speaker 7: Yeah.
[136:05] Speaker 4: You're in trouble.
[136:06] Speaker 10: You can't see them.
[136:07] Speaker 9: You can barely hear them. Yes.
[136:09] Speaker 4: No, no, no. Oh, also, we need a new photo with median with the vegetation.
[136:23] Speaker 10: Yeah, we'll try to get that re reflown if we can.
[136:28] Speaker 1: Drone shot. Yep, Yep.
[136:30] Speaker 10: Yeah, that was. That was a drone shot. Clearly taken of Rum Rill during the winter. So things were not as lush as we'd like to see because we hadn't
[136:43] Speaker 8: finished the median yet. So.
[136:46] Speaker 4: Great. Thank you.
[136:47] Speaker 8: Thank you.
[136:49] Speaker 2: Thank you, Vice Mayor. Thank you for the presentation. I think I have a couple of questions. I went back to September 29, 2025, when we had a meeting on the CIP list and the new CIP list. And what I didn't. What I. What was presented here that is not on this list is a citywide street light upgrade that's not there, and it's really needed.
[137:29] Speaker 9: And let me address this. As part of the budget process, we started looking at some projects that we were kind of doing every year. And that was a project that existed annually so that as people had requests
[137:49] Speaker 10: for streetlights, we would use that CIP money for.
[137:54] Speaker 9: We've transitioned that project to our operations budget. So because it's something that, like you say, we need it, and it was something that was a small and pretty much consistent sum. We're like, should this really be a CIP project, or should this be part of our operations budget? And so we decided that it should be an operations. Should be an item in our OPS
[138:25] Speaker 8: budget, so we moved it there.
[138:27] Speaker 2: So can you. Can you roughly tell us about how many street light upgrades they had been in the last, you know, year and a half since 2025, actually, we haven't done.
[138:42] Speaker 9: I don't think we've done more than two or three in the last year and a half. It's not consistent and mostly it goes on requests from the public. But because it's frequent enough, like it's been on as a CIP project for probably at least the last five or six years.
[139:04] Speaker 10: It was one of those things where, like, it really.
[139:07] Speaker 2: It belongs in operating or not.
[139:10] Speaker 10: Yeah, I mean, in that.
[139:11] Speaker 9: That concept of CIP is really new pro. New projects that we know or, or projects that are active for one or
[139:21] Speaker 10: two years that you go build, maybe
[139:22] Speaker 9: not something that's consistently there that you utilize.
[139:27] Speaker 2: So then this is included in the budget then?
[139:29] Speaker 8: Yes.
[139:30] Speaker 2: So it's a line item. It's a line item in a budget.
[139:34] Speaker 10: Operations budget.
[139:35] Speaker 2: Right. It's a line item. Right. But it's a line item in the operating. Yes, the operating budget, yes. So you, you only wait for people to call and say, hey, this light isn't working. Can you please.
[139:54] Speaker 9: No, not.
[139:54] Speaker 10: Hold on.
[139:55] Speaker 9: It's more like when we're going to add.
[139:58] Speaker 10: When I say we wait for people, wait for the public when they're saying,
[140:01] Speaker 9: hey, this is an area that's dark.
[140:04] Speaker 8: We need a new light.
[140:05] Speaker 9: If it's something that's repaired, a light that's out, that's part of the maintenance budget. So this is that. That street light CIP item that you're referring to was basically for the additions of new light, new lights, as opposed to maintaining existing lighting.
[140:25] Speaker 1: And remember, we don't own all of our street lights. Two thirds are owned by PG and E. We only own about a third.
[140:31] Speaker 2: Okay, so when somebody said, says we don't have a light here, that is then our responsibility, not PG and E. Because we're not talking maintenance. We're talking about a street being way too dark and it's dangerous.
[140:46] Speaker 10: Right. That would be what that is for.
[140:48] Speaker 9: And because that project has been in
[140:51] Speaker 10: existence for multiple years. Okay, we swapped it over.
[140:56] Speaker 2: All right. Because that does improve safety in our city. It does improve the confidence people have in walking the streets. You know, after some people work till 9, 10 o' clock and then they, you know, but if they have to go down the street that's really dark
[141:16] Speaker 9: and opposed to having that as something we have to come to council for,
[141:20] Speaker 10: for, for every time we do a
[141:21] Speaker 9: light in the ops budget, then there's funding there and we could just utilize
[141:25] Speaker 8: it and make it less, make it
[141:28] Speaker 9: more seamless between request and install.
[141:35] Speaker 2: So how long does it take? So I call, I call and I say, hey, this street is way dark. You know, what can you do? Can you. I'm thinking as a right, A person who lives in San Pablo who just came in, how long does it take for a light to be put out? Once they, they put in the request,
[141:54] Speaker 9: it's probably approaching six to nine months. We have to, we have to evaluate the location. We have to measure sidewalks. We have to, you know, and also when you start to look at a
[142:06] Speaker 8: light location, you have to start looking for the design around it.
[142:10] Speaker 9: Like where you can't just put a light in.
[142:13] Speaker 1: Right.
[142:14] Speaker 10: You have to make sure your right
[142:15] Speaker 9: of way is wide enough. So it takes a little bit.
[142:17] Speaker 1: Plus we also do a photovoltaic study as part of that process too, to make sure that there is adequate lighting. So it does take some time because it is the public right of way. We have to make sure everything meets all the specifications and so forth.
[142:31] Speaker 2: So six to nine months. Okay. All right, then. Giant road bridge repair. When I compared the, the, the list from 2025, the estimated total costs went up what, 20, 20, $3,000 is that.
[142:51] Speaker 9: Yep, it did. We did additional. Because that project had been on, on the books for a little bit, we
[142:59] Speaker 8: went back and, and had to update the plans and for new CEQA compliance.
[143:08] Speaker 9: And when we were looking at it,
[143:09] Speaker 8: we found the condition of the road
[143:12] Speaker 9: a little bit worse than what we thought in the previous design. And so we're actually doing a slightly different pavement.
[143:21] Speaker 8: I say pavement because it's concrete, but
[143:23] Speaker 9: we're doing a slightly different repair. And so that repair is, the cost
[143:31] Speaker 8: of that repair is reflected.
[143:33] Speaker 2: Okay. Okay. And this is going to start in fall 2026.
[143:41] Speaker 10: Yes.
[143:42] Speaker 2: Right. Okay. Okay. The same thing with Project 202, San Pablo Bridge replacement.
[143:53] Speaker 9: Oh, yes.
[143:56] Speaker 2: So explain it. Help me understand this active and proposed project on September 2025. What was here was for fiscal year 2025, 26, it was $145,000. That was, I think, still needed right now. We're, I mean, $12 million. I mean, this, that one was.
[144:21] Speaker 9: Okay, so what has happened? Okay, so Caltrans, when we submitted the 35% plans to Caltrans to approve the alignment, Caltrans asked for a lot of
[144:36] Speaker 8: additional studies that we were not prepared to do. Some of those studies involve drilling. There is an environmental aspect that, that we needed to begin and then the cost of everything since the pandemic, as far as Engineering has gone up at least 20%. And so with the additional, we've also been asked to do a 2D analysis of the edge at the ends of the bridge, the support structures. So we got asked by Caltrans to do a lot more work than we anticipated. And so the design costs have gone up. And with that, what we're going to have to install structure wise for the bridge has also gone up. So we've had scope creep. But again, this is a bridge that's 100 years old and doesn't have the capacity to serve the traffic that it serves.
[145:39] Speaker 1: So,
[145:44] Speaker 2: So usually when you, when just to help me understand how this, how this works, when you assess this replacement or something that needs to be upgraded, you wait until you're fully, fully funded before you, before you go out.
[146:07] Speaker 10: No.
[146:08] Speaker 9: So we've done a 35% design and then it.
[146:12] Speaker 8: Originally we were looking to do a 65 design and then a 95 design.
[146:20] Speaker 9: But at the 35% review,
[146:24] Speaker 8: the Caltrans hit us with a lot of things that the design team wasn't anticipating. And when this project was originally budgeted, some of the environmental rules have changed. And so we set a budget based on one set of rules. And as the rules have gotten progressively more stringent, then the impact of that to the budget gets reflected and.
[146:57] Speaker 1: Right. Caltrans and Caltrans deemed the bridge obsolete. So they're kind of like the oversight agency that we have to get everything approved by. So there are requirements we have to march to in order to fully fund the project and have it ready for construction. So we have to deal with Caltrans on this. There's, there's no going beyond around Caltrans.
[147:21] Speaker 10: Now one of the things that, that
[147:22] Speaker 8: we've tried to do is because we were looking at the archway project, the replacement of that archway, trying to incorporate the design of that into the bridge so that we can basically get that new structure going and have it be a symbol for the city that we know that the existing structure is, it needs improvement. And so trying to incorporate that into the design as well.
[147:56] Speaker 3: Okay,
[148:00] Speaker 2: that's a big desk. That's just, that's a lot.
[148:03] Speaker 10: It is a lot.
[148:04] Speaker 2: This is a big difference.
[148:06] Speaker 8: Yes, it is.
[148:09] Speaker 2: Okay, so with the rum reel spread sports, that should start happening in winter 2026.
[148:17] Speaker 8: Yes.
[148:17] Speaker 2: Right. Okay. All right. There is, I think 707 was also something that I kind of seen. It was summary funding needs for fiscal year 2526. I'm sorry, sorry. 707 is 3 million, 350 it went up a little. It went up. Then that's.
[148:51] Speaker 9: That is. That is in six months.
[148:55] Speaker 2: All right.
[148:56] Speaker 8: Again, again, when we, when we submitted the. We submit plans, if it's something that's going to Caltrans.
[149:04] Speaker 2: Okay.
[149:05] Speaker 5: It's tough.
[149:05] Speaker 8: I mean, those are the hard decisions. And also why we so actively pursue grants to try to offset that.
[149:15] Speaker 2: Yeah. And the Princeton Plaza stabilization.
[149:23] Speaker 8: Yes.
[149:25] Speaker 2: This is ongoing. I mean, there's work done every single.
[149:29] Speaker 9: So we. Again, going back to that example with
[149:33] Speaker 8: the, with the streetlights that you asked me a couple of minutes ago. So there's monitoring of Princeton Plaza and
[149:41] Speaker 9: then there's the actual installing, doing more
[149:43] Speaker 8: boreholes and installing more seismic monitoring equipment.
[149:50] Speaker 9: So what we've done is we've taken the monitoring that is pretty much consistent, move that to operations. Then when we actually go out there and do boreholes and actually have to move equipment, we've made that the CIP so that it better reflects what's going on.
[150:10] Speaker 2: Okay. That's why.
[150:11] Speaker 1: Right. And this is for geotechnic requirements because we do have a moving hillside.
[150:17] Speaker 2: Yeah, for sure.
[150:18] Speaker 1: Is in our public liability area. So we need.
[150:20] Speaker 2: I was just asking because of the, the dollar amounts being so different.
[150:25] Speaker 10: You're doing your due diligence original.
[150:27] Speaker 2: But what he did was reclassified a portion just like you did with the lighting. Okay.
[150:31] Speaker 9: Right.
[150:32] Speaker 2: All right. The 601 is not in here, which is Giant Road. Or is it before I say it. Hold on, 608 is. It is in here. I don't know why I highlighted it. Maybe because here it said $350,000. The amount and its projected cost is 1 million. To which.
[151:05] Speaker 9: Which project is that? 608.
[151:06] Speaker 2: The Giant. 601. The Giant Road pavement rehab. Let me see, Let me see. 601. Oh, no, you had one. 1432. Actually, it went. It went down from the total cost in 2025 turn out to six. Okay.
[151:29] Speaker 9: We were sharpening our pencils.
[151:33] Speaker 2: All right. All right, then I have just one final question. And this is for Matt. There's. As you can see, as we all know, there's a lot of work to be done in the city of San Pablo. Right. And we're always looking for funding. At what point does the city consider either hiring an outside contractor to seek grants specifically for these projects? Because we know we don't necessarily start working on anything until we're fully funded.
[152:22] Speaker 10: It looks like before we go to construction.
[152:26] Speaker 2: Right. We need to have make sure that the money is there. So I just wonder if that was something to consider. I mean, there is money out there, it's just going after it.
[152:41] Speaker 1: So we've discussed this internally before and if we do hire specific professional grant writers or professional service providers who excel in capital infrastructure grant funding, those costs can be anywhere from 100 to $150,000 annually. So we do have a very good internal staff who have been going after grants for quite some time. I mean, if you look at the monumental number of grants we did to build Rum Roll Streets Corridor project, that was all in house. So there's no question that our staff is very skilled at going after those grant resources without having to pay an outside consultant, which we can't afford right now at this day and time. So we continue to be successful in acquiring those grants. And again, this is just a two year window on what we feel that we're going to be able to accomplish given our current funding sources and external funding sources that we have identified to be able to get these bidded out and awarded and into construction. So you always have to remind yourself just hiring a grant contractor might be ideal, but they have to also produce the grants to offset their costs. So that's the dilemma we have. So we're not saying we're against it, but I think if we have more revenue capacity, we can certainly formally consider it. If we're looking at priority projects where we feel we can't do it internally with staff, that we may have to pick one or two projects like the San Paul Avenue bridge replacement project. We've gone after several federal grant sources and have not been awarded. That might be one eligible project we might focus on to close that $12 million gap. Also, I did mention your EIFD is going to be also that mechanism that helps close the gap on some of these street, road and bridges projects. So there are mechanisms available, but at this point in time we can't afford to hire a grant writer. And then also we're going to be using some one time money next year. And I'm talking to Jill about this about hiring contract project management staff because we don't have the staff internally to manage the projects once we award them and get them out the door. So we will be hiring some professional services using one time money next fiscal year that is going to be deficit. We needed to support some of these CIP projects that are in your CIP budget right now. So that's the priority.
[155:13] Speaker 2: Yeah, because I bet if I look back three years, some of these projects are still unfunded. And it's like, so when are we going to start looking after these money. I mean, we keep funding our reserves. I think our reserves is at 80% of the operating expenses, which is. It's high. I mean, we won't, we will not lose our rating if we lower that. But that's for another conversation. I want to say this last thing just for thought and consideration, because you all know that I really am invested in San Pablo and I wanted to start looking like people want to be here not only for our businesses, so that the businesses can benefit from increased sales, right? Most of our businesses here are mom and pop. But then when people come here, it's already. We know it's already safe, right? But if it doesn't look safe and perception is big, then they're less likely to want to come and hang out here and spend their money. So I want to. And I did write it up because I know I can sometimes just go over and kind of rant. And I don't want to do that. So I want to speak briefly about beautification, not as an esthetic issue, but as strategic investment tied directly to economic development, public safety and community perception. Currently, the city budgets $250,000 annually toward beautification. When compared to our multi million dollar capital investments, this level of funding is not sufficient to meaningfully improve corridor conditions or shift community perception. And this is not about appearance, it's about economic competitiveness. Our own budget emphasizes the importance of attracting private investment and improving corridor branding. However, perception drives investment. If our corridor corridors do not reflect safety, care and vibrancy, we limit our ability to attract businesses and development. $250,000 does not move the city. The needle. Citywide, we are investing millions in infrastructure, roads, bridges and corridors, but only only a fraction of that in how those investments are experienced by the public. Without complementary beautification, we risk building infrastructure that functions well but does not improve community perception or economic activity. And I'm not recommending new funding general funding spending. Instead, I propose embedding beautification into existing CIP program projects, allocating a small percentage 1 or 2% from project budgets, leveraging external funding and partnerships. This allows us to increase the impact without increasing fiscal risk. A modest increase from 250,000 to approximately 500,000 to 750,000 will significantly improve visible outcomes. This can be achieved through reallocation and strategic funding alignment, not new spending commitments. We should prioritize high visibility areas, major corridors such as San Pablo Avenue, entry points and gateways, high traffic community areas. Residents need to see tangible improvements. Visible change builds trust and confidence in city leadership, beautification also supports public safety, improve lighting, maintain spaces and clean corridors, contribute to crime deterrence and align with our border broader public safety investment. This is prevent preventative infrastructure. If we maintain the current funding level, we risk continuing a cycle where infrastructure improves but perception does not. This disconnect ultimately impacts economic growth, community pride and long term revenue potential. And in closing, beautification is not discretionary. It is a strategic investment. By integrate integrating it into our existing capital projects and leveraging available funding sources, we can enhance the city image, support economic development and improve public safety without increasing financial strain. I respect respectfully ask the council to consider a phased increase and a more integrated approach to beautification within the CIP framework. And yeah, so I also think about us going out to and telling asking our constituents a sales tax is going is is the right move. If they see investment that we're already investing in it, we probably will get a stronger. Yes, that is my position.
[160:48] Speaker 1: So just to clarify, as Matt indicated in the two year presentation, the 250,000 in both 2627 and 2728 are just placeholders. There's no funding appropriate yet. So right now you just approved on Monday night the project engineer consultant who prepare this plan. And once that plan is prepared, you also approved an ad hoc subcommittee which consists of the mayor and Councilman Ponce to sit down with consultant and staff to review the draft plan. So this follows previous direction already given by the council on January 20 and the 12 to 14 conceptual projects that are going to be added to the citywide beautification plan. So right now it'd be very premature for us to talk about any funding appropriation until the plan's developed. We have a recommendation from the subcommittee and yes, the subcommittee can provide a recommendation on one, which projects get elevated to be done in year one or year two or year three. And also recommending a funding allocation. Right now the funding appropriation and funding source has not been identified. So we're allowing the consultant to put the plan together and then there will be a recommendation to the ad hoc subcommittee and a recommendation from the subcommittee to the council for June so that you can have a discussion on how you best want to implement and fund your beautification plan.
[162:17] Speaker 2: I get it, but what I'm asking is because what happens when we get get into the meeting and we look at, you know, what is needed with, with the consultant and the consultant says it's going to cost about $450,000 to get just this phase done. Our budget says $250,000 and it's only, you know, it's only a placeholder. But why does that placeholder have to be so minimal?
[162:49] Speaker 1: Because when we know there's more work. When we brought this forward, we said that this is a three year plan, we're going to be allocating 750,000 but that we have to get a plan developed by a project engineer because we have to prioritize how we're going to implement the plan over three years. The 250 is not set in stone. Those are just placeholders. So like I said, it's premature for us to be talking about funding appropriation when we haven't identified the funding source or the amount needed because we don't have the plan developed yet. So like I said in June, but you'll see this first. As a member of the ad hoc subcommittee, you'll have an opportunity to make a recommendation on which projects get funded and at what funding level. So that way the council can decide as a whole what they want to fund. That's the process you agreed to in,
[163:43] Speaker 10: in an intermediary capacity.
[163:45] Speaker 2: 50 is still not enough. I don't care what anybody says to me, the need, the need, the need that this without within our need and what, you know, the city should have as a placeholder. But okay.
[164:01] Speaker 10: In maintenance we have been making it
[164:03] Speaker 9: a priority to go back in large areas of medians.
[164:06] Speaker 8: If you look at the intersection of Brookside and 23rd, that large triangular patch right there, we did a recent project
[164:16] Speaker 9: where we, we really focused on that area. So that's what we've been doing at, in an intermediary condition is trying to really go back and, and look at our medians and try to, to do that because our medians are along those
[164:34] Speaker 8: major arterials that you're talking about and
[164:37] Speaker 9: so trying to, so it's been happening. We may not be as, as vocal
[164:45] Speaker 8: about it because that hasn't necessarily been part of this staged plan but, but public works and maintenance has been working
[164:54] Speaker 9: to, to address those things in the
[164:57] Speaker 8: capacity that we can immediately.
[165:02] Speaker 2: Okay. Okay. Any more questions?
[165:07] Speaker 7: Yeah, a couple questions.
[165:09] Speaker 2: Okay.
[165:14] Speaker 7: I really don't want to want to ask this question but just for curiosity because we don't have no one, we don't have any funds right now, but in the near future are we still planning to move forward with the Rollingwood Community Center?
[165:26] Speaker 1: Yes.
[165:27] Speaker 10: So yeah, that is still on our five year list.
[165:31] Speaker 1: So we just submitted to our federal representatives and this is what was ratified by the council when the mayor signed the letter on March 6, those two projects have been elevated to our two U.S. senators and Congressman Garam Mendy for federal funding allocation. So we're hoping to earmark around $2 million for Rollingwood Community Center. Now, whether the federal government or the state government because we also submit that to our state representatives. Yeah, if that gets added to the state budget, great. If not, again under your eifd city facilities is one of those areas where we can fund using that mechanism. So if we don't get any federal or state funds or any grant funds that we identify, then we'll use our EIFD to help implement the rehabilitation needed for that facility. So there is going to be a need for ADA improvements, major uniform building code improvements and really deciding how we're going to multi purpose that facility either as a meeting location because there is a lack of parking for that facility because it's in that neighborhood, but it could be another smaller community center or community meeting location once we get funding to upgrade that facility. It's just taking some time to get federal state support.
[166:56] Speaker 7: Since it's an unincorporated area, we can't approach the county supervisors for some assistance.
[167:02] Speaker 1: So if you, if you don't Remember back in 2018 it used to be part of the old Wildart Recreation District which has now been dissolved by the county and the county was the successor agency to that district and so they actually owned that asset. And so when they were dissolving the district we went in and purchased the site in the center. So even though it's in county unincorporated, we own that asset. So the county doesn't really have any fiscal responsibility anymore to put dollars into an asset they no longer own. And plus the district is no longer viable so it's been dissolved. So it's still owned by the city. And so our intention is to make it a multi purpose use facility of some, some sort
[167:55] Speaker 7: and then back to the the consultants and, and to try to get more funding, I suggest we content we continue working with Congress and senators who sit on transportation infrastructure committees and commissions and continue sending our letters to them to apply for grants.
[168:16] Speaker 1: Yeah, absolutely.
[168:17] Speaker 7: That we're constantly looking for funding.
[168:19] Speaker 1: Right. And don't forget when we come back at mid year budget cycle and we've got our new revenue sources coming online again, we may be able to revisit the CIP budget and then add some funding to some of these projects that are in dire need of it. So there's an opportunity to revisit the CIP budget at the midpoint and see if we can't Augment it with some additional funding or one time funding or any other funding source that may be out there that we can apply to our CIP project list.
[168:49] Speaker 7: Okay. And then back to the. Thanks, Matt. And back to the lighting.
[168:53] Speaker 9: Yes.
[168:54] Speaker 7: So when there was recently that. At Davis park, there was a vandalism there.
[168:58] Speaker 8: Yes.
[168:59] Speaker 7: We had to. Regarding the lighting situation.
[169:02] Speaker 8: Yes.
[169:02] Speaker 7: So that came out of your operating budget or.
[169:06] Speaker 10: Yeah, we used on call and we
[169:10] Speaker 9: used an on call contractor and that
[169:12] Speaker 8: came out of our. A lot of that came out of
[169:13] Speaker 1: the OPS budget because you had $53,000.
[169:16] Speaker 7: It took a few, few months to get that right.
[169:19] Speaker 10: Yeah, we had to agree on a scope. We had to agree on, you know,
[169:23] Speaker 9: how to, how to make changes to make it a little less the, the, the vaults a little less accessible.
[169:33] Speaker 7: Thank you. Yeah.
[169:35] Speaker 1: Yes.
[169:35] Speaker 7: Yeah, no, I know it's live and learn and. But do we want to make sure those areas are protected so people won't try to do what they did in that circumstance of vandalism there? So.
[169:51] Speaker 10: Yeah.
[169:51] Speaker 7: Thank you so much.
[169:52] Speaker 9: Yeah, we, we can make things tamper resistant.
[169:55] Speaker 10: Yeah, we can't make it tamper proof.
[169:57] Speaker 7: Yeah. Thank you. Thank you, Madam Mayor.
[170:00] Speaker 2: Okay. Any further questions? Anything else? Okay, so before, before the motion is made, I just want to make sure that there is going to be a consultant soon to review the percentage of reserves.
[170:22] Speaker 1: Yeah.
[170:22] Speaker 2: So we'll do all of that.
[170:24] Speaker 1: We're currently evaluating those professional services and so we hope to bring forward a contract. Our city attorney will look at that agreement and then we'll bring it forward, depending on the dollar amount to retain those services. Now if it's under 50,000, then it's. I can execute it under my authority, but it's over. Then I'll come to council for approval. So we're in the process of evaluating, doing a proposal right now.
[170:48] Speaker 2: Okay. Well, thank you everyone for, for the presentation.
[171:00] Speaker 7: Yeah.
[171:01] Speaker 1: So we do need a formal action because you're not adopting the budget tonight.
[171:06] Speaker 7: Okay.
[171:06] Speaker 1: What you're doing is providing direction to obviously consider the preliminary draft budget for fiscal years 2627 and 27 28, biannual operating budget and capital improvement budget and then proceed with council public hearing on June 1, 2026. And then the staff will develop the final fiscal year biannual operating budget and two year CIP budget for the the budget required hearing and that's required in your municipal code. And then from there, once we conclude with the hearing, budget enabling resolutions will be prepared and come forward on consent at your following June 15th city council meeting. For formal adoption. So tonight you're just providing majority vote direction to proceed with final budget development for the hearing.
[171:58] Speaker 2: What is the pleasure of the council?
[172:03] Speaker 4: Hi. Move that we approve them and go ahead with finalizing the proposed preliminary draft budget and CIP budget for formal adoption in June.
[172:21] Speaker 7: I second.
[172:25] Speaker 3: Council Member Cruz.
[172:27] Speaker 5: Aye.
[172:28] Speaker 3: Vice Mayor Xavier.
[172:31] Speaker 4: Hi.
[172:31] Speaker 3: Mayor Pabone Alvarado.
[172:33] Speaker 2: Aye.
[172:34] Speaker 3: Motion passes.
[172:35] Speaker 7: Thank you.
[172:36] Speaker 10: Great.
[172:37] Speaker 2: Matthew, I didn't say thank you, but thank you for your presentation and for indulging me in answering all my questions. Appreciate you. Okay, now we can adjourn.
[172:48] Speaker 7: Thank you. Thank you. Matt, too. And the department heads the budget committee. You and Patricia. Councilman? Yeah.
[172:58] Speaker 2: Okay.
[172:58] Speaker 7: Thank you, guys. Yeah.
[173:00] Speaker 2: All right, so we're adjourned to regular council meeting on Monday, April 20, 2026.
[173:06] Speaker 7: Thank you. Good night. Drive safe.