San Leandro Finance Committee Meeting – April 22, 2026: Fee Schedule, Investment Reports
San Leandro Finance Committee Meeting – April 22, 2026
The San Leandro Finance Committee met on Wednesday, April 22, 2026, at 4:00 PM in the City Council Chambers. Mayor González chaired the meeting; Councilmember Viveros-Walton was present, and Councilmember Aguilar was excused. The committee reviewed the proposed FY 2027 Master Fee Schedule, the 2025 Q4 Investment Report, and the 2025 Q4 OPEB and Pension Trust Investment Reports. No public comments were received. The meeting adjourned at 4:45 PM.
Discussion Items
2.A – Review of the Proposed FY 2027 Master Fee Schedule Update and Annual Rate Adjustments
- Presentation: Assistant Finance Director Felicia Silva presented the proposed fee schedule, which is updated annually to balance cost recovery and accessibility. The schedule is governed by Proposition 26 (reasonable fees for cost recovery) and Proposition 218 (utility fees, e.g., wastewater and stormwater). Development impact fees (e.g., park acquisition, traffic mitigation) are also included. The proposal builds on an in-depth fee study presented to council last year.
- Inflation Adjustments: For most services, fees are adjusted by inflation. For construction-related fees, the Bay Area Construction Cost Index is used (2.8% increase). For three taxes—business license tax, emergency medical services tax, and emergency communication system access tax—a 3% CPI increase is proposed, as allowed by municipal code.
- Parking Fee Discussion: Councilmember Viveros-Walton raised concerns from downtown businesses, particularly regarding parking fee zones near the Best Building lot. The City Manager’s office explained that the west side of East 14th Street is subject to a historic agreement (Marea) prohibiting parking charges, while the Best Building lot (city-owned) is currently $1/hour. A public meeting with 15–18 business owners was held, and the city is actively evaluating the rate. The parking fund is now solvent and no longer requires a general fund subsidy (previously several hundred thousand dollars annually). The proposed fee schedule sets caps; the city will optimize rates after at least one year of data.
- Committee Action: The committee voted unanimously to recommend the fee schedule to the full City Council for adoption by resolution, and to recommend the 3% CPI increases for the three taxes for adoption by ordinance. No public comments were made.
2.B – Review of 2025 Q4 Investment Report (through December 31, 2025)
- Presentation: Monique Spyke of PFM Asset Management (PFMAM) presented the report. Key economic context: the U.S. government shutdown (42 days), labor market softening, inflation above 2% target, and the Federal Reserve cutting rates by 25 basis points twice (target range: 3.50%–3.75%).
- Portfolio Activity: PFMAM rebalanced the portfolio, moving $8 million to liquidity investments. They diversified into corporate notes, certificates of deposit, commercial mortgage-backed securities, federal agency securities, and commercial paper, reducing U.S. Treasury allocation. The portfolio yield at cost is 4.16%, and the duration is approximately two years.
- Performance: For Q4 2025, the portfolio’s total return was 1.12%, slightly above the benchmark (0–5 year U.S. Treasury index) return of 1.10%. For Q1 2026, the portfolio returned 53 basis points versus the benchmark’s 43 basis points. Mayor González requested a clearer explanation of the expected risk premium over the benchmark, given the portfolio’s credit quality (28% in securities under one year duration). PFMAM will provide a deeper dive on sector spreads in future reports.
- Committee Action: The committee unanimously recommended that the City Council adopt the investment report by resolution.
2.C – 2025 Q4 OPEB Trust and Pension Trust Investment Report (through December 31, 2025)
- Presentation: Assistant Finance Director Felicia Silva presented the report. These trusts are held separately for future post-employment benefits and pensions.
- OPEB Trust: Q4 2025 return: 1.54% (approx. $370,000). Calendar year 2025 return: 10.73% ($2.4 million). Inception-to-date return: just over 5%.
- Pension Trust: Q4 2025 return: 1.89% (approx. $688,000). One-year return: 12.86%. Inception-to-date return: 4.64%.
- Outlook: The quarter was described as “sluggish,” and Q1 2026 is expected to show negative returns due to geopolitical conflict. The investment advisor is actively managing with a long-term view.
- Future Plans: The committee will receive a deeper dive on both trusts at the next Finance Committee meeting (May 2026) and a discussion on amending investment strategies in June 2026. A CalPERS update is expected in late summer/early fall 2026 after the release of updated actuarial information. Councilmember Viveros-Walton requested that the CalPERS presentation be tailored to address council’s questions.
- Committee Action: The committee accepted the report (no resolution required). Councilmember Viveros-Walton suggested that the City Council also formally accept the report as good governance; the item will be discussed further.
Committee Member Comments
- Councilmember Viveros-Walton requested a brief follow-up (15 minutes) to better understand the rationale for the $8 million liquidity increase, particularly how the portfolio’s duration is aligned with expected cash flow needs. Assistant Finance Director Silva noted that the strategy changed from a 0–3 year to a 0–5 year duration to capture higher yields while ensuring liquidity, and that the portfolio is now appropriately sized.
Key Outcomes
- Item 2.A: Unanimous recommendation to City Council to adopt the FY 2027 Master Fee Schedule and the 3% CPI increases for the three taxes (business license, EMS, emergency communication).
- Item 2.B: Unanimous recommendation to City Council to adopt the 2025 Q4 Investment Report by resolution.
- Item 2.C: Committee accepted the 2025 Q4 OPEB and Pension Trust Investment Report. Future meetings will include deeper dives on trust strategies (May 2026) and investment strategy amendments (June 2026), with a CalPERS presentation later in 2026.
- No public comments were made on any agenda item.
Meeting Transcript
Recording in progress. Okay, so it's four o'clock and I call you over to the City of Cellulator Finance Committee meeting. Today is Wednesday on the second says four o'clock. Would you please take their role? Mayor Gonzalez. Vice Mayor Miguel Salton. And Councilmember Eggler would not be present today. And would you please take your answer? After each agenda item is presented, the mayor will ask for committee member comments and then take public comment. You will have two minutes for your comment. The compound member will appear for the convenience of the speaker and attendees. There you are. The floor is yours. Yes, thank you. Felicia Silva, Assistant Finance Director, Mayor Gonzalez. Finance Committee here to present the fiscal year 2027 proposed master fee schedule update. We do bring this forward every year to update the council council approved fees while we ensure cost uh accessibility while trying to maximize cost recovery. Um the authority to be able to charge the fees. We're looking at proposition 26, California government code 66014, and the key point here is we are allowed to charge fees for um cost recovery of services, but reasonable fees. Um, so always looking at the estimated reasonable cost for our fees. And uh additional authority, we have proposition 218. Um we see this um governing our fees associated with our utilities such as wastewater and uh store water. We also have development impact fees, um, which are fees that are um designed to mitigate the impact of um development on the community. Um so for example, we have our our park um acquisition and improvement fee and traffic um mitigation fees or impact fees. Um where we've been and where we're headed. Uh we did do an in-depth um fee study that we presented to council last year. This um presentation uh to council with proposed fees built on that fee study. Um it also incorporates um any fees that were approved throughout the year to give us the quote unquote master fee schedule. Um typically, again, looking at um trying to make sure that we're balancing cost recovery and accessibility. Um we adjust by inflation for most of our services for uh fees that are related to construction related activities. We have what we call the construction cost index for the Bay Area that we use, which um is set at 2.8 percent, and then we also have some fees that are governed by um state statute or municipal code that uh may have a cap or may other um lies be um inflated based on that governing information, and then um some other fees may be updated uh regarding uh market alignment and or direct cost um depending on again looking at um our estimated reasonable cost and um trying to maximize cost recovery what we can. I do want to point out that the revenue impact associated with the recommended fees are included in the proposed fiscal year 2027 mid-cycle budget. In addition to fees, um we also have um three um taxes that are um by uh chapter two of the municipal code um allowed to be adjusted for inflation, and that's our business license tax, uh, our emergency medical services tax, and as well as our emergency communication system access tax. Again, looking at that uh CPI um index for uh our region in the Bay Area, we're proposing a three percent CPI increase. And what we're asking from finance committee today, we're asking that um finance committee recommend that the master fee schedule be presented to um city council for adoption by resolution, and we're also recommending that the three percent CPI um increase that we're proposing for those three taxes be presented to city council for adoption of ordinances. And with that, I'm here to answer any questions. And we also have some of the departments here for any questions regarding specific fees. Do we have any questions? Okay. So we'll pass the floor over to the Vice Mayor. Thank you for all your work into getting us to hear today. And do we have the city managers office here to discuss parking can be they're coming out? Thank you. And I know that the parking uh, the new parking fees, and it has all been revamped due to usage and kind of just up, just bringing it up to the I don't know when was the last time I think we're reviewed, but what we have here today, I did want to elevate some of the concerns from uh the downtown businesses that they came to council, particularly around the East 14th, um the East 14th delineation, um the east side of East 14th of the best building is having parking years, but not the other side. Um I do know I do notice that there are some um the zones have been changed and the hour maximum has been changed. Can you talk a little bit about um the best building lot three, downtown core, the one, two, three. There's through two downtown corps and a downtown run and the downtown south. Can you tell a little bit about what that um what's the delineation of those zones? Uh certainly there is a map available on MarcusL.com that has kind of a map overview of where those different areas are with regards to the best building. I can talk about that and have to provide some information, as well as the relationship of that parking lot to the west side, because this in this schedule, as you correctly noted, there's been some feedback from the business community highlighting those distinctions.
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