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HomeMy WebLinkAbout2025-02-11 Policy & Services Committee Summary MinutesPOLICY & SERVICES COMMITTEE SUMMARY MINUTES Page 1 of 15 Regular Meeting February 11, 2025 The Policy & Services Committee of the City of Palo Alto met on this date in Council Chambers and by virtual teleconference at 7:00 p.m. Present In-Person: Veenker (Chair), Lu, Stone Absent: None Call to Order Vice Mayor Veenker called the meeting to order. Deputy City Clerk Christine Prior called roll and declared all were present. Public Comments Ken H. requested that the City levy a two cent per ounce tax on sugar-sweetened beverages for general governmental use to sustain vital City services. He requested that the Clerk send the Committee the minutes from 2018, which was when the subject was first introduced to Council. He also asked the Clerk to send the executive order from the governor who was proposing a similar measure for the State. Jennifer L. discussed airplane noise. She wanted to know how Council engaged with the public and how issues were placed on Council’s agenda and the public agenda. She had sent an email to Council on January 11 regarding her interest in the issue discussed at this Committee’s December 10 meeting. In the minutes, she did not find a topic on how items would make the public agenda or how Colleagues’ Memos, etc., would be handled going forward. She asked that consideration be given to printing a small handbook or that there be a webpage for the public with updated rules and protocols to engage effectively with Council. Vice Mayor Veenker announced that Item 3 would be heard before Item 2. Action Items 1. Office of the City Auditor Presentation of the Grant Management Audit Report City Auditor Kate Murdock voiced that the Grant Management Audit was part of the FY2024 Annual Audit Plan. SUMMARY MINUTES Page 2 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 Baker Tilly Project Manager Claire Veazey stated that the audit was to determine whether the City had adequate internal controls to manage the grant lifecycle efficiently and effectively. She provided the background of grant management. She displayed slides and detailed their findings and recommendations as it related to ways the grant analyst could further improve the grant administration process, which included coordinated oversight, recordkeeping and internal reporting, and grant opportunities. She noted that ASD agreed with their recommendations. Councilmember Lu asked if the risks of the recordkeeping and grant tracking issues could be shared and if any of the grants analyzed included putative measures for not fulling obligations or if any obligations were missed. He questioned how separate accounts or cost centers were currently tracked and how the budget for spent grant money was reconciled in the budget. Project Manager Veazey replied that they had tested whether grants met certain deadlines for reporting and there were no financial penalties for those. Of the samples tested, they checked grants that had been closed out, and they did not find any instances of funding being left on the table. They did not find instances of any high risks. Assistant Director of Administrative Services Christine Paras answered that if it was a capital project they would usually track the grant funding within the capital project. Generally they would include grant revenue in a category and file it under federal, state, or local grants. Councilmember Stone inquired what the process would be to implement the recommendations. Assistant Director Paras responded that they hired a grant analyst to work through a lot of the recommendations. Some would be great improvements to the processes, especially with incoming tracking of opportunities, which they were focused on. In the next several months, they hoped to update the policy to include a full picture of the grant lifecycle and guidance for departments on how they could better track manage with their oversight. Deputy City Manager Chantal Cotton Gaines added that Assistant Director Paras and her team were looking forward to taking the recommendations to continue to build out the grants program to receive a larger volume and dollar amounts in federal or state grants. Vice Mayor Veenker provided staff an opportunity to comment on there being more grant dollars flowing in than what had been prepandemic. She requested more granularity on a formal work plan being under development. She wanted to know what the City did well when it came to the application process and what made the City attractive as a grantee, which could be a learning opportunity. Deputy City Manager Gaines stated that they were working with Townsend Public Affairs for all advocacy work for state, federal, and grants management. They used a somewhat intermingled nature of that to follow up with some of the agencies they had built relationships with when applying for grants that had not been received. She provided an example of being more competitive in applying for grants. They had monthly meetings with Townsend, and they SUMMARY MINUTES Page 3 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 usually addressed forthcoming opportunities and being competitive. She thought Assistant Director Paras and Grants Management Analyst Michael Hagerty were looking forward to having a better tracking system for knowing what had been applied for and what had been received/not received, and that information would be used for future grants. City Manager Ed Shikada introduced Grants Management Analyst Michael Hagerty. Grants Management Analyst Michael Hagerty expressed that he was looking forward to working with the Committee on the audit and implementing the recommendations. Vice Mayor Veenker wanted to know how best to get grants in the door and how to utilize them once they were in. She noted that this was an opportunity to augment and supplement the budget on specific items. She addressed the recommendation for Finding 1 and inquired what other grants the policy would apply to. City Auditor Murdock answered that the City received certain grants that did not need to be applied for. Vice Mayor Veenker wanted to understand why the grants received that were not applied for would not be tracked or monitored. City Auditor Murdock understood that those grants did not require the same level of reporting as grants that were applied for. Analyst Hagerty thought it was speaking to the requirement to list federal grant expenditures specifically as a more specific requirement but it was generally a good principle to track all grant agreements associated with the City. Assistant Director Paras added that they should track grants overall. She stated that some grants could be looked at on a case-by-case basis and some things stipulated in the policy may not apply to such grant requirements. She thought part of their role was to review grant requirements against the policy, and if things did not fit, they would alter their approach and document it with ASD. Public Comment There were no requests to speak. MOTION: Councilmember Stone moved, seconded by Councilmember Lu, to recommend the City Council approve the results of the Grant Management Audit Report. MOTION PASSED: 3-0 City Manager Shikada mentioned that, based on the unanimous recommendation, the item would appear on the full Council’s consent agenda. SUMMARY MINUTES Page 4 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 Item 3 heard out of order before Item 2 3. Nonprofit Partnerships Workplan: Phased Approach Assistant to the City Manager Lupita Alamos stated that the recommendation was to review and recommend Council approve a phased approach to enhancing nonprofit partnerships beginning with the process improvements for nonprofit requests for funding through the FY2026 budget process. It was important to note which would fall outside of a currently established process. She discussed the purpose of the Nonprofit Work Plan. They needed to establish a work plan with a clear framework that would align nonprofit partnerships with Council priorities, ensure fairness and inclusion in resource allocation, and strengthen accountability while maintaining agility to evolving community needs. The totality of the work plan had two phases, which she elaborated on. She recapped the guiding principles and defined the principles, practices, and products. The revised principles included impact-oriented focus and accountability; service alignment; fairness, open access, equity, and inclusion; and flexibility for special circumstances. In the second phase of the work plan, P&S would define how the work would apply to grant program service and lease agreements. The focus at this meeting was to discuss Phase 1 of the work plan. The four key elements supporting the discussion included funding availability, eligibility and criteria, application, evaluation process and time frame, and monitoring and reporting. She furnished slides and discussed the recommendations and best practices within the key elements. Related to the time frame, she presented two options for the Committee’s consideration. As for next steps, they would continue to engage nonprofits throughout the process, and feedback would be incorporated throughout the process to inform Council actions. They planned to share information through City platforms as well as dedicating a Nonprofit Work Plan webpage. She furnished a slide with staff’s recommendation. If the Committee agreed with the approach, staff had outlined the four elements to inform the work. City Manager Ed Shikada commented that staff proposed a work plan first phase that would fit within the context of the upcoming budget cycle, which was a way to provide guidance to any nonprofit submitting a request in the upcoming budget. If Council was amenable to the approach, there was an opportunity at this meeting and there would be an opportunity next month to nail down specifics. At some point, the Finance Committee would evaluate any proposals received this year. Item 3 Public Comment Charlie W., Palo Alto Chamber of Commerce, voiced that the Chamber represented over 30 local nonprofits that received funding from Palo Alto. They supported the Partnership Work Plan process to enhance the engagement and relationship with the nonprofits, the four guiding principles, and P&S recommending an initial Phase 1 approach for nonprofits not currently in the established funding process for request for funding in the FY2026 budget. He discussed why they were interested in continued evaluation of the Phase 1 outcomes. SUMMARY MINUTES Page 5 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 Dal C. (zoom), Program Manager with Palo Alto Downtown Streets Team, agreed with the City’s phased approach to funding. Vice Mayor Veenker asked if the Committee was onboard with the four nonprofit relationship principles and looking at Work Plan Phase 1. If so, she suggested addressing each of the four categories in order. She requested Committee comments related to the approach to funding availability. Councilmember Stone was concerned that he had not observed progress in proposing new City events. He did not see a plan to further invest in community events. He did not observe a problem with the approach, but he questioned where that money would come from and what would be left for City-sponsored and funded events. City Manager Shikada responded that City-sponsored community events were separate resources. In terms of the funding shown, they wanted to provide a foundation that would enable an overall approach to have funds to work with, and the funding designated in last year’s budget seemed to be a logical starting place. Council could decide to increase available dollars for these types of uses or others as may be appropriate based on the overall fiscal situation. For events specifically, they would bring a separate item to Council to review the plan for City-sponsored/produced events, which would be funded outside the dollars being spoken to completely. It would be useful to think about City-produced events ran by CSD. There was a $50K proposal that was anticipated to be an expansion beyond the existing Know Your Neighbors Grant, which could be used for larger grants. There was $185K that could be used for events, but it was intended to be available for broader purposes that may be proposed by nonprofit partners. Community Services Director Kristen O’Kane added that oftentimes applications for the Know Your Neighbors Grant were for community-wide events. She discussed a group that had wanted to do an event that did not qualify for the Know Your Neighbors Grant and Council used their contingency to fund it. This process would allow such to be done at the staff level with the CSD. Council Member Stone thought the process of the larger Know Your Neighbor grants and a more formal process was far better than the current process. He was comfortable moving forward with the staff recommendation related to funding. Councilmember Lu thought the funding and the breakdown were reasonable. He presumed it was something that could be finetuned upon receiving requests. Vice Mayor Veenker understood that City events and programming would come from other funds, that this money would go for the nonprofit process, and that $50K would be for community-planned, community-wide events. She asked about the Know Your Neighbors small events. City Manager Shikada stated that $235K was the sum of the $50K and the $185K. What had been budgeted in the past year for City events and programs would be implemented in $50K SUMMARY MINUTES Page 6 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 for grants similar to Know Your Neighbors. He noted that a new name was needed. It would be for larger community events up to $5K. The $185K was the totality of what would be used for the Phase 1 approach. The Know Your Neighbors grants was a separate line item of $50K, and there was a $1K limit per grant. Director O’Kane added that it was an ongoing budget line in the CSD operating budget, which was $50K. It was up to $1K for one type of grant and she believed there was another number for a different type of grant depending on it being for a block or a neighborhood. Vice Mayor Veenker understood that there were smaller dollar Know Your Neighbors grants up to a total of $50K; another $50K up to the $5K for city-wide, community-planned events; then the second $50K plus $185K for a total of $235K; and that the $185K was being discussed for the nonprofit proposals, which was separate from what would be presented to Council in a couple weeks. City Manager Shikada confirmed that Vice Mayor Veenker’s understanding was correct. Vice Mayor Veenker addressed eligibility and criteria and asked the Committee if there were questions related to the criteria on Slide 12. Councilmember Lu asked if non-501(c)(3)s had an interest in applying for grants. He was concerned that groups such as a school club or the Pickleball Club might want funds for hosting events. While figuring out what the process should be, he suggested that it be opened up to see who would apply before restricting it too narrowly. City Manager Shikada answered that generally non-501(c)(3)s had no interest in applying for grants. Occasionally there had been discussions with organizations that were not 501(c)(3)s, but he believed they were very exceptional as opposed to it being the norm. He explained why staff recommended limiting it to 501(c)(3)s, especially while piloting the process overall. He discussed there being possible issues in opening it up to informal groups. Human Services Manager Minka Van Der Zwaag added being a 501(c)(3) was not required for HSRAP but just that it be a human services organization. In her 15 years of HSRAP history, only once did a for-profit apply for money, which she explained was not a legitimate ask. It was primarily 501(c)(3)s receiving HSRAP funding. Councilmember Stone seconded staff’s preference for 501(c)(3)s. Regarding criteria for allocating community grants, aligning with Council priorities made sense to some extent, but he was concerned that with exclusively relying on Council priorities some of the most underserved would be missed. He wanted those groups to be especially cared for, which the nonprofits were good at identifying and advocating for. He thought the other criteria were helpful and important. He believed community reach should be weighed the most. He mentioned that the equity impact and the nonprofits’ ability to show they could deliver on programs or services was key. As for new or existing grantees, he felt those currently receiving funds from the City SUMMARY MINUTES Page 7 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 and those relying on City funding to leverage other funding sources should be prioritized. He inquired if there were plans for the HRC to weigh in on this. City Manager Shikada replied that staff was looking to the Committee on how best to include the HRC as part of the decision-making related to the overall process or how it would be implemented. They included the schedule and the time line as a consideration in fitting within the upcoming budget cycle. Vice Mayor Veenker supported adhering to 501(c)(3)s, at least in the early days, and generally aligning it with Council priorities. The best practices made sense. She discussed the new or existing organization issue being tricky. She thought it was important to be open to both sets of circumstances and to monitor it going forward. She inquired how it would be known if a program aligned more with services provided by the County or State. She addressed the process and the timing and the two options staff presented and queried if one would coincide to end with the budget process and if the other would give nonprofits another 50 days to get applications in, so the funding would come a little later. Assistant to the City Manager Alamos provided an example of a county typically providing health services, which could be identified by staff and with a note to Council of the potential of being better served at that level. She confirmed that Vice Mayor Veenker described the two options correctly. She reported that there had been a listening session with the nonprofits yesterday and that timing to access funds was important. Councilmember Stone preferred, regarding timing, that it be done for the budget cycle, but he thought Option 2 made sense for this year. However, in future years, he wanted to aim for Option 1. He questioned if the concern with involving the HRC and other groups related to the time line for this year in getting this started and not for future years. Regarding the application process, he understood that the full Council reviewing proposals and awarding grants directly related to this year because of the time line, which made sense for this year. He noted that on the HRC there were subcommittees dedicated to examining requests, then recommendations would be made to the full body, and then it would be forwarded to Council, and he thought there should be a similar process after this year. He wondered if the HRC should provide recommendations to be returned to the full Council for the final decision. He did not think it should go to the full Council first. He thought the HRC, a subcommittee, or a newly created separate subcommittee should review the requests. Councilmember Lu thought the HRC’s HSRAP grants generally focused on health, equity, and other services whereas some the grants the Committee received might be arts programs, etc., things that would be hard to weigh and would ultimately be a subjective Council decision. If more efficient for this cycle, he thought it would be fine if only Council weighed in. He wanted there to be a clear process for voting on multiple applications. Concerning the time frame, he asked what was envisioned to happen differently in Option 1 versus 2 between March 24 and April 14. He inquired if in the listening session any of the nonprofits expressed an option preference. He asked if under Option 2 there would be a potential to miss out on summer SUMMARY MINUTES Page 8 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 programs or those wanting to do something more quickly. He felt either option was viable. Aligning with budgeting was appealing, but he was concerned that the budgeting meetings would be overloaded and that there would not be time to consider the merits of the nonprofits that would be voted for. City Manager Shikada answered that the concern with involving the HRC and other groups related to the time line for this year, not future years. He clarified that Option 1 would run parallel or be a part of the budget decisions, which inherently would involve the Finance Committee making a recommendation to the full Council. He thought the statement “Council approval of funding awards” was more likely to be the Finance Committee recommendations such that the funding awards would be part of the overall budget approval. Assistant to the City Manager Alamos stated that the April 14 date would allow staff more time to prepare and turn materials around. The nonprofits saw the presentation in the listening session, and there was a preference for the earlier time frame. Concerning Option 2 and there being a potential to miss out on certain programs, she was not sure about the timing of those months in particular in terms of influx of applications or events happening. She added that they received a comment about not receiving funding in a timely manner, but there had not been a process to manage one-off requests. Through this process, they could try to guarantee a more timely dissemination of funds. Vice Mayor Veenker asked if there was an option for the Finance Committee to say there would be X dollars for X but without taking on a heavy burden of budgeting all the other pieces of the City’s doings. She felt P&S had a closer relationship with the nonprofit partners. She expressed that ideally there should be a committee delving into this, but she was reluctant to recommend creating such a committee so early in the process, but she wondered if P&S could do that. She asked if the item could be placed on consent if the Committee had a unanimous recommendation. City Manager Shikada replied that all options were open and ultimately for Council to decide. If Council agreed to the dollar amount, P&S could be charged with evaluating the applications to determine which organizations would be funded within that dollar amount, which could run in parallel with the Finance Committee’s discussion of the rest of the budget and all would plug in at the time of bringing the approval forward. Councilmember Lu thought what was described aligned with Option 2, and he wondered if the time lines of Option 2 could be tightened up and funding be awarded before the summer recess or at some point early mid-summer. City Manager Shikada stated that when staff brings forward a recommended budget in late April, recommended levels would be set. For example, if it was $285K, Council could choose to keep going down that path or adjustments could be made at the initial review, and as the Finance Committee did their work, P&S could be assigned to work on the specific decision. SUMMARY MINUTES Page 9 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 Vice Mayor Veenker inquired if under Option 1 Council could approve the dollar amount on March 24 and if P&S could then look at the applications under either option while the Finance Committee did its work in parallel. She noted that some nonprofits could not always withstand waiting for dollars, and she would gravitate to Option 1 to honor that if there was a way to make it work. City Manager Shikada confirmed that under Option 1 Council could approve the dollar amount on March 24 and P&S could then look at the applications under either option while the Finance Committee did its work in parallel. It could be a fixed dollar amount or a ballpark amount with the final decision being made as a part of the budget adoption. Councilmember Stone believed it would be fine if P&S vetted the applications and made recommendations based on the City Manager’s budget proposal. He would be surprised if the proposed budget changed dramatically, but if it did, the Committee could recommend a dollar amount and break it down proportionally. He thought a longer time frame for the nonprofits was desirable, but it may be something between Option 1 and 2. Vice Mayor Veenker asked that next time the public provide input on the time lines of the options, and in the in the interim, she welcomed emails and communications to staff. She addressed monitoring and reporting and commented that the break point for semiannual reporting, etc., should apply to grants of at least $10K or $20K. She liked the escalating and deescalating demand. Councilmember Stone felt the range for the medium grants was too broad. Assistant to the City Manager Alamos had no concerns in raising the break point. Vice Mayor Veenker asked what else staff needed from this meeting. Assistant to the City Manager Alamos thought there was enough feedback to bring it back next month along with any community or nonprofit partner feedback on option preference. Councilmember Lu asked if next month the Committee would choose an option. Assistant to the City Manager Alamos confirmed that was correct. NO ACTION TAKEN 2. Office of the City Auditor Presentation of the Utility Billing Audit Report And Recommendation to City Council for Approval City Auditor Kate Murdock stated that the Utility Billing Audit was on the FY2024 Annual Audit Plan. She presented slides and outlined the objectives of the audit. She provided some background related to the CPAU and Public Works. She noted that the Utility was making improvements to the billing process through the Advanced Metering Infrastructure Project, and as of mid-January, approximately 80 percent of the meters had been installed. She discussed SUMMARY MINUTES Page 10 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 the audit findings, areas for improvement, and recommendations as it related to billing accuracy, internal control gaps, and the billing process. Assistant Director for Utility Customer Support Services Tom Auzenne remarked that they basically agreed with the findings and they were in the process of implementing the recommendations. Public Comment There were no requests to speak. Councilmember Lu questioned why this specific issue was audited, if there were specific incidents of fraud or customer complaints, and if there were any learnings or analysis related to the correctness of the metering or the frequency of adjustments and how that might have changed over time. He stated that they periodically received email complaints related to billing adjustments after a metering or some other random change, and he asked if such issues had been investigated. He referenced the second bullet under additional observations related to metrics that could be tracked over time, and he asked if staff had responded to those metrics and if there were plans to track them and report changes. He thought some were core metrics, such as first contact resolution rate and overall customer satisfaction. He believed the financial metrics should be reported to the UAC regularly. City Auditor Murdock replied that they did a city-wide risk assessment and that some years it was more involved and in depth than others. They had several criterion factors in looking at different programs, departments, etc., and she believed her predecessor may have had questions about how adjustments were being handled. Nothing specific prompted the audit. As they looked at the adjustment process, they had investigated what prompted an adjustment. They did not do a larger scale trend analysis as it was outside the scope of the audit. This audit focused on billing being accurate. They did a lot of testing around bill calculation and the calculations being in line with City policy, and they found that adjustments were being handled well. Assistant Director Auzenne responded that there had been internal discussions about the metrics, some of which were already tracked and some they would have to create, and they would have to be monitored on a manual basis. It could be incorporated into some of the reporting to the UAC on a regular basis. The customer satisfaction metric was done in a number of places, and Utilities was rolled into that. Vice Mayor Veenker thanked the Utilities Department for having a good audit result. She noted that Finding 2 of the Internal Control Gaps recommended segregating duties between processing and approving adjustments and that Finding 1 recommended automating approvals to minimize human error, and she inquired if automating approvals naturally segregated duties. City Auditor Murdock responded that the second recommendation about consumption adjustments was specific to those types of adjustments being done. SUMMARY MINUTES Page 11 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 Assistant Director Auzenne added that it was also probably related to approval authorities. They wanted to ensure that the person preparing the document would not be the person approving the document. He explained that it was more of a manual process. They could try to find a way to automate it a little more. He thought it required a tweak more than a needed automation. He discussed implausible verifications, and they hoped a lot of them would go away. MOTION: Councilmember Stone moved, seconded by Councilmember Lu, to recommend the City Council approve the results of the Utility Billing Audit Report. MOTION PASSED: 3-0 4. Follow Up from 2025 Council Retreat - Discussion on 2025 Umbrella Operating Strategies Guiding Council Priorities Deputy City Manager Chantal Cotton Gaines stated this item related to the idea of establishing umbrella operating strategies in addition to existing Council values and priorities and the priority objectives. The Staff Report summed up some of the discussion at the retreat, and they shared where some of the proposed operating strategies were potentially already reflected in the existing value statement or the City budget. She suggested that the Committee discuss whether the existing values were captured in the way intended or if there was further interest in exploring the umbrella strategies in some way. She reference Packet Page 63, which included a table with the proposed umbrella operating strategies and related Council actions already in place. She thought Council wanted the Committee to discuss it and see if it should move forward and, if so, how. Item 4 Public Comment Jennifer L (zoom) opined that engaging with the City had become very convoluted. She had a hard time getting updates from the City and having things put on the agenda. She wondered if residents had been asked about their experience in engaging with Council, and she asked if there was a way to improve public engagement. She expressed her disappointment in Council as it related to working on issues on the public agenda. She requested that residents’ comments related to the process be considered. Councilmember Lu inquired if the Mayor had provided any more clarity related to his thoughts about the strategies. Deputy City Manager Gaines replied that they had not received anything beyond the retreat discussion. Vice Mayor Veenker had not received additional comment on deployment. It was a Mayor- driven suggestion, and he knew that additions, deletions, and approval or rejection would be addressed at this meeting. She thought he wanted to know if this would be helpful. SUMMARY MINUTES Page 12 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 Councilmember Stone understood that the operating strategies would be used by Council and staff to further refine how City priorities would be achieved each year. He asked staff how they might use these strategies in accomplishing the annual priorities. He referenced balancing some of the strategies. He found reducing employee vacancy rates and taking a more cautious approach to budgeting decisions to be contradicting. He felt that most of the strategies were being done under the set of values passed by Council a few years ago. He asked if staff or Committee members found this to be redundant or if it provided additional value in prioritizing the work. Assistant to the City Manager Lupita Alamos believed the intended framework was to help Council frame and develop priorities. Deputy City Manager Gaines stated that in staff’s review of the umbrella strategies, they tried to determine where it was linked to other things in which staff already had direction from Council on. As an example, with reducing the employee vacancy rate, Council had that as part of the performance metrics for the City Manager and it was something they reported to Council regularly. As for budgeting decisions, one of the Council values focused on fiscal sustainability, so staff thought it was covered in some existing direction that had been given. She added that the same was true with increasing effectiveness and channels of communication and safeguarding public trust through transparent processes. If the Committee had other ideas for that, it could be robust, and staff was open to that. She thought structuring committees for optimum effectiveness was a topic at the retreat and with action related to what committees would be continued. She voiced that she would not say they were not brining additional value. She described it as the Council being intentional with the direction they gave to staff already, and she thought the items aligned with some of that direction. Councilmember Stone thought a better job could be done referencing the values at priority- setting time. He felt that a lot of work could be put into this to only be forgotten about in a couple years. He believed it would be interesting to agendize discussions related to improving committee assignments. He voiced that Council could work more efficiently by respecting committee recommendations, etc., although Council should critically look at recommendations. He believed other cities and organizations did a lot of work at the committee level that would then go to the full body as typically more of a consent item. He thought Council could do better in that regard. He wanted there to be reexamination of how the retreat was done and how beneficial it was for Council, the community, and staff. Overall he liked how the Mayor was thinking outside the box and trying to change some of the ways the work was done, and he felt it was a valuable discussion. He wanted a better understanding of the goal. He felt a lot of it was being done in a lot of ways. Deputy City Manager Gaines liked the idea of elevating the values a little more during the priority setting process. She noted that staff had folded the values into the Council procedures and protocols. SUMMARY MINUTES Page 13 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 Vice Mayor Veenker appreciated the Mayor lifting up focus or prioritizing items. She considered this to be more a matter of emphasis than something different or new. She felt there had been an operating strategy to reduce employee vacancy, and she appreciated that it was a performance indicator for the City Manager, so she thought it was there as an operating strategy. She believed there was an underlying interest to get more granular information in the interest of reducing employee vacancy faster. The Mayor indicated to her that he was interested in reviewing vacancies by department. She thought tracking to see if more resources were required so it could be more intentional could be taken note of. Deputy City Manager Gaines voiced that in the budget process they were able to note some of what had been seen throughout the course of the year and what they expected in terms of resources for the upcoming fiscal year as it related to vacancies, but she understood there might be a question related to how often the information was provided. Vice Mayor Veenker thought the idea was to get information more often than annually. She agreed that there was tension between taking a more cautious approach to budgeting and reducing employee vacancies. She thought it would be councilmember to councilmember as to the degree of risk versus caution each would be comfortable with. She wanted to bear in mind balancing revenues as it had been done. She noted that the Mayor wanted to promote communication, which she found to be consistent with the values. With respect to the public comment, she thought it would be well received by the community. More thought may need to be given to structuring committees and the agendas syncing up with the priority objectives so they could be promoted and so Council would be better informed about where staff was on those and where there might be hitches. She supported the retreat being more efficient and productive, which could help with communication and policymaking. She was not sure a separate statement of operating strategy needed to be adopted, but she thought lessons could be taken from all the items. She did not feel a need to approve or reject them. She thought note should be taken and that the strategies should be embedded in the work. Councilmember Lu believed the operating strategies were something to think about. He opined that if they were not officially adopted they would not go anywhere, which he thought was fine. He liked the intent of the operating strategies. He imagined there was flexibility for staff to reframe some of the issues upon being presented to Council. For example, regarding a more cautious approach to budgeting, perhaps the Staff Report could discuss funding cliffs, budget issues, and projects with uncertain funding so a budget decision could be made. He thought the Mayor was making a case for staff reports or changes in staff practices to enable Council to be more effective, which he considered to be a reason for adoption. As for structuring committees, he thought P&S should see more policies and services. He was happy to see that homelessness and mental health issues would come to this body for deeper discussion. Vice Mayor Veenker thought P&S could take on the task of structuring committees. As for making policy decisions, she wondered if it could be recommended to the full Council that the following questions be asked: 1) Whether it would accelerate reducing employee vacancy, 2) whether financial impacts would be sufficiently cautious in light of the economic uncertainty SUMMARY MINUTES Page 14 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 backdrop, and 3) whether there had been effective communication of the policy options and decisions to residents. She noted that it would almost be a self-check list to be contemplated in making decisions. Council Member Lu queried whether staff could change their approach to agendizing items or including information in staff reports that aligned with the first three umbrella strategies. Deputy City Manager Gaines thought they had information hitting some of these and maybe they could pull that thread a little more in Staff Reports. In every Staff Report there was a section focused on fiscal impact, which is where she thought the financial impacts were being considered. She felt it would be good to ask those questions if staff was not quite addressing things in the tickler list the way it was imagined. There was also a stakeholder engagement section in the Staff Reports, and the intention of that section was to address who had been talked to in a process before it was presented to Council and where staff had shared information. There was opportunity to expand on such information. They did not address vacancies in Staff Reports unless relevant to a specific topic, so that would not be addressed in every Staff Report, but the existing structure of the other two should include enough baseline information. Councilmember Lu thought subtle changes might make sense. Regarding vacancies, he liked that the City Manager had a numerical goal. He agreed with Vice Mayor Veenker’s recommendation that councilmembers pay attention to these issues. Deputy City Manager Gaines stated that Human Resources had a large recruitment strategy that Council was aware of, so they were actively working on reducing vacancies and they were working on that within all the departments. MOTION: Councilmember Veenker moved, seconded by Councilmember Stone, to recommend the City Council direct staff to, when appropriate, include the following in staff reports: • Departmental employee vacancy rates when relevant • Associated risks in the Fiscal Impact section • Type and volume of communication in the Stakeholder Engagement section and any recommendations for increased effectiveness of communications Councilmember Lu was thinking about a bullet to proactively agendize issues that could reduce employee vacancies or budget burdens. For example, if there was no funding strategy for Palo Alto LINK, he suggested that be presented to Council to settle the budget. He thought it would be good to present to Council budget issues and anything that could help with vacancies. Vice Mayor Veenker thought the budget would typically go to the Finance Committee if they saw an issue that was likely to create risk of being out of range of revenue or the expense side SUMMARY MINUTES Page 15 of 15 Policy & Services Committee Meeting Summary Minutes: 2/11/25 of the budget. She asked how it would be flagged for Council if staff saw some change of circumstance that would have an adverse or positive revenue or expense impact. Deputy City Manager Gaines thought that information would be in the quarterly financial reports going to, she believed, the Finance Committee. Assistant City Manager Kiely Nose stated perhaps the best opportunity to provide some of the statistical updates would be in quarterly reports to the Finance Committee. She assured the Committee that staff would say something if something was going south. At the end of this month, she expected the full Council to discuss the financial status perspective. She added that there were minimum quarterly and likely more frequent touchpoints with Council on all the topics. Deputy City Manager Gaines stated the item could go on consent since it passed unanimously. Vice Mayor Veenker declared that the Committee agreed to place the item on consent. MOTION PASSED: 3-0 Future Meetings and Agendas Deputy City Manager Chantal Cotton Gaines noted that the next meeting would be March 11. There would be a few audit reports and a follow-up discussion on the Nonprofits Work Plan, and there may be one other item, which she would verify with staff. Councilmember Stone asked if the 7:00 start time was at the discretion of the body or if it was written into the procedures and protocols. Deputy City Manager Gaines replied that she was looking to the Clerk’s Office and the Attorney’s Office for the official process, but typically committees could meet at whatever time they preferred. Caio Arellano, Chief Assistant City Attorney, believed the Chair had the discretion to change the start time. Discussion ensued related to start time preferences. Chief Assistant City Attorney Arellano added that as long as the start time was properly reflected on the agenda, the meeting schedule and start time was a Committee decision. Vice Mayor Veenker declared that the March meeting would start at 6:00. Adjournment: The meeting was adjourned at 9:35 p.m.