San Leandro Finance Committee Meeting (Nov. 19, 2025)

The San Leandro City Council Finance Committee met on Nov. 19, 2025 and heard reports on (1) annual AB 1600 Development Impact Fees (DIFs) (referencing fiscal year ending June 30, 2025), (2) quarter-three investment performance for the City’s OPEB and Pension Trusts (through Sept. 30, 2025), and (3) the proposed 2026 Finance Committee meeting calendar. The committee provided direction on improving future reporting transparency (including five-year DIF spending deadlines) and forwarded items to the full City Council by consensus. The meeting adjourned at 4:39 p.m. (start time not stated in the transcript).

Public Comments & Testimony

• No public comments were received during the meeting (including on agenda items and on non-agenda items).

Discussion Items

• 2A — Annual AB 1600 Development Impact Fee Report (FY ending June 30, 2025) (Presenter: Angie Nichols, Finance Manager)

  • Purpose/requirements explained: DIFs must be segregated from the General Fund; records must be maintained for funded projects; fees must be spent or committed within five years or the City must make a finding showing continued need; the City must present an annual DIF report within 180 days after fiscal year-end.
  • Streets/Traffic DIF (Special Revenue Fund 120):
    • Began FY 2025 with $1.6 million fund balance.
    • Collected $210,000 (including interest).
    • Spent $140,000.
    • Ended with $1.7 million.
    • Of the ending balance: $10,000 encumbered (P.O. obligations), $512,000 committed to projects, and $1.1 million uncommitted.
    • Staff noted that although some funds were “uncommitted” at year-end, they were identified as funding sources in the City’s 10-year CIP plan for certain projects.
  • Parks Facilities DIF (Special Revenue Fund 122):
    • Began FY 2025 with $6.0 million.
    • Collected about $841,000 (fees, revenue, and interest).
    • Spent $25,000.
    • Ended with $6.9 million.
    • $4.9 million was committed to projects; uncommitted funds were described as anticipated to fund upcoming projects, including the Washington Manor Park site-specific master plan (adopted by Council in June 2025).
  • Unaudited numbers: Staff stated the figures were unaudited because the audit was still in progress, but changes were not anticipated to be significant.
  • Committee questions/direction:
    • A committee member requested clearer disclosure at Council of which “uncommitted” balances are effectively planned/assigned through the CIP, because those funds are not truly available for new allocation.
    • Recreation & Parks Director (name unclear in transcript; referred to as Director of Recreation & Parks) stated staff would use the recently adopted Recreation and Parks Master Plan to identify priorities and bring future project commitments back to Council; staff also planned to re-evaluate some currently committed projects for potential uncommitment if better-aligned priorities emerged from community feedback.
    • Discussion of specific committed/identified projects included:
      • Stephen Taylor “Sanctity of Life” Memorial: Committee asked whether the listed $140,678 delta reflected the additional cost previously discussed. Engineering staff explained the project was rebid after scope reduction but still exceeded estimates; Council approved an increased total appropriation of $765,678 (up from an original budget of about $625,000). A committee member expressed surprise and said they would review Council’s prior action.
      • Farrelly Pool replacement: A committee member questioned why funds appeared still committed when the facility was open; staff explained that after final audit closeout, any remaining committed funds may be brought back for re-commitment to other projects.
      • “Downtown Park Construction” (parks DIF list): Director explained the project had been identified with Engineering/Community Development for a possible downtown park, but several projects were on hold pending completion of the master plan; staff anticipated re-evaluating these and returning to Council.
    • Five-year DIF spending deadlines: A committee member emphasized the importance of tracking when specific DIF tranches approach the five-year deadline, requested a simple “expiring funds” spreadsheet, and asked whether reallocating funds restarts the five-year clock (staff answered it does not; the City can make findings explaining continued need and transition to a different eligible project).
    • Traffic fee applicability: A committee member asked whether Fund 120 inflows are exclusively from new development and whether substantial remodels/changes of use could trigger the fee; staff said fees are associated with new development and agreed to follow up on the remodel/change-of-use question.
    • Davis & Doolittle intersection: Committee asked why a project would be listed at an intersection they believed was within Caltrans jurisdiction; engineering staff clarified the work described was on a corner where the City is responsible for that signal, while some other signals (e.g., on East 14th) are the State’s responsibility.
    • Park acquisition need: Director stated the master plan identified a need for additional park acreage and recommended collaborating with economic/community development to identify opportunities in park-deficient areas; allocation between acquisition vs. refurbishments would be handled case-by-case based on need, opportunity, and long-term strategy.

• 2B — OPEB & Pension Trust Investment Performance Report (through Sept. 30, 2025)

  • Presenter: Finance staff (speaker name not clearly captured in transcript).
  • OPEB Trust (retiree medical fund): value increased from $23.5 million (last quarter) to $24.3 million; one-year return ~6.85%; since-inception return a little over 5%.
  • Pension Trust: value increased from $34.7 million (last quarter) to $36.7 million; one-year return ~9.15%; since-inception return ~4.45%.
  • Market context cited by staff: easing financial conditions relative to earlier tariff uncertainty; ongoing monitoring of inflation (not at the Fed’s 2% target; staff cited “close to about 3%”), labor market, geopolitical/political risks (including Middle East conflict) and a prolonged government shutdown (as stated in the transcript).
  • Committee position/concern: The chair/committee member stated ongoing concerns (over “two or three years”) that the City’s investment approach yields returns materially lower than CalPERS, describing a “material” compounded opportunity cost and indicating this should be explored further by the committee/council.

• 2C — Proposed 2026 Finance Committee Meeting Calendar

  • Regular schedule proposed: fourth Wednesday of each month through October.
  • Holiday adjustments requested: move November and December 2026 meetings to the third Wednesday of those months.
  • Conflicts disclosed: A committee member stated the shift to third Wednesdays in November/December could conflict with another commitment, and also disclosed being out of town on Jan. 28 for the U.S. Mayor’s Conference.
  • Budget calendar planning: Staff stated they were planning to bring budget-related items to the Finance Committee in February and March, with a tentative Council work session in April and adoption in May.
  • ERP implementation noted: Committee requested proactive updates to avoid surprises; staff stated payroll go-live was tentatively March 1 and new financials were still targeted for July 1.

Key Outcomes

• AB 1600 Development Impact Fee Report (Item 2A): Committee reached consensus to recommend forwarding the annual AB 1600 DIF report to the full City Council for consideration/adoption (no roll-call vote reported).
• OPEB & Pension Trust Investment Report (Item 2B): Committee reached unanimous consensus to forward the quarterly report to the City Council (with the expectation it could be placed on the Council’s consent calendar).
• 2026 Finance Committee Calendar (Item 2C): Committee reached consensus to approve the proposed 2026 meeting calendar, including shifting November and December meetings to the third Wednesday to accommodate holidays.
• Staff follow-ups/direction (no formal vote):
  • Add clearer reporting on DIF “uncommitted” funds that are functionally planned via the CIP.
  • Provide a spreadsheet tracking DIF tranches approaching the five-year spending/commitment deadline.
  • Follow up on whether traffic impact fees apply only to new buildings or also to major remodels/change-of-use.
  • Bring future Recreation & Parks DIF commitments (and potential re-commitments/uncommitments) back to Council aligned with the adopted master plan.