San Leandro Finance Committee Meeting – March 26, 2025

The Finance Committee of the San Leandro City Council met on March 26, 2025, at 4:01 PM in the Surlene Grant Community Room. Mayor Gonzalez and Councilmember Viveros-Walton were present; Councilmember Aguilar was excused. The meeting covered three discussion items: proposed fee updates for multiple departments, an update on the Workday Enterprise Resource Planning (ERP) project, and the fourth-quarter 2024 investment report. No public comments were received. The meeting adjourned at 5:27 PM.

Discussion Items

• 25-130 Discussion on Fees: City Manager’s Office, City Clerk, Parking, Recreation and Parks, Golf
  Staff presented proposed fee adjustments for fiscal year 2025–26, focusing on cost recovery, simplification, and alignment with operational costs. Key points included:

  • Parking fees: Proposed hourly meter rate increases (zone one from $1.50 to $2; zone two from $0.75 to $1) and monthly garage permit adjustments (unrestricted from $35 to $45; low-income from $15 to $20), plus a new reserved spot option at $960/year. The parking fund currently operates at a ~$300,000 annual deficit, with $950,000 in budgeted revenue (2024–25) and actual expenses of $1,009,000 in 2024. Staff noted that over a third of parking meters were broken, reducing revenue, and enforcement has recently increased.
  • Recreation, Parks, and Golf fees: Staff proposed condensing eligibility categories (A through G) into four groups (city-administered, public agencies/nonprofits, residents, non-residents/businesses) with a mathematical markup of 30% between tiers. Councilmember Viveros-Walton expressed concern that neighborhood associations without formal nonprofit status might face higher fees, and staff agreed to consider including them under the nonprofit category. Mayor Gonzalez discussed broader equity considerations, noting that park and field fees should balance cost recovery with social benefit, citing the example of underused athletic fields and a past $2 per visit loss at pools.
  • City Manager and City Clerk fees: Adjustments to public records reproduction costs, subpoena fees, and the “fire and closing out sales” application fee were clarified. The latter applies to going‑out‑of‑business sidewalk sales.

• 25-132 Workday Enterprise Resource Planning (ERP) Project Update
  Chief Technology Officer Michael Seiner reported that the ERP project is on schedule and on budget. Phase 1 (HR/Payroll) go‑live is set for January 2026, delayed from October 2025 due to a change to bi‑weekly pay cycles. Phase 2 (Core Financials) is expected to go live in July 2026. The total biennial budget request includes approximately $2.1 million in implementation costs (mainly for implementation partner Cognizant and Workday software) plus an $814,452 contingency (10% of project cost). Staff costs for six new FTEs are pending approval of a new MOU.
  Mayor Gonzalez questioned the size of the contingency (over 20% of consulting costs) and expressed concern that it could become an expected overrun. He urged aggressive management of vendor performance and strategic decisions to avoid delays that could trigger additional costs. Councilmember Viveros-Walton asked about project governance and the roles of Finance, HR, and IT; staff noted the City Manager is the executive sponsor and a steering committee oversees the work.

• 25-141 Calendar Year 2024, Fourth Quarter Investment Report Update
  Finance Director Nicole Gonzalez presented the portfolio performance for October–December 2024. Total combined portfolio assets were $222.5 million, a decrease of $3.3 million from the prior quarter due to liquidity needs (securities were not reinvested). The Chandler‑managed portfolio yielded 4.43% (vs. benchmark 4.25%); LAIF and Wells Fargo cash balances yielded 2.75%.
  Councilmember Viveros‑Walton asked about investment selection and noted concerns about some corporations in the portfolio. Staff explained that investments must comply with the City’s investment policy and Government Code, and that additional restrictions could be added but may increase management costs.
  Mayor Gonzalez critiqued the report’s usefulness: he questioned whether the portfolio consistently “beats the market” simply because it bears more risk, and requested that future reports include explanatory context for changes in market value and a clearer discussion of risk exposure. He also raised the broader question of the appropriate risk level for the City’s investment strategy.

Key Outcomes

• The Finance Committee accepted the reports for Items 25‑130, 25‑132, and 25‑141 (as noted in the minutes). No formal votes were taken; the committee directed staff to incorporate feedback.
• For fees: Staff will explore including neighborhood associations under the nonprofit fee category for recreation facilities.
• For the ERP project: The committee noted the importance of staying on budget and on schedule; staff will provide a deeper briefing on project governance and risk mitigation.
• For the investment report: The Finance Director will consider providing additional context and risk‑adjusted performance analysis in future quarterly reports.