HomeMy WebLinkAboutStaff Report 2511-5402CITY OF PALO ALTO
CITY COUNCIL
Monday, November 10, 2025
Council Chambers & Hybrid
5:30 PM
Agenda Item
AA1.Adopt a Resolution Deferring CPAU Late Fees and Collection Actions for Certain
Customers Affected by the Ongoing Federal Government Shutdown; CEQA Status –
Not a Project. New Item Added
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City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Utilities
Meeting Date: November 10, 2025
Report #:2511-5402
TITLE
Adopt a Resolution Deferring CPAU Late Fees and Collection Actions for Certain Customers
Affected by the Ongoing Federal Government Shutdown; CEQA Status – Not a Project.
RECOMMENDATION
Staff recommends Council adopt a Resolution that temporarily defers late fees and other
collection actions for certain residential customers (Rate Assistance Program (RAP) participants
and federal employees) who are anticipated to be in financial hardship due to the federal
government shutdown.
EXECUTIVE SUMMARY
The current federal government shutdown has disrupted the income and benefits of many
federal employees and low-income households nationwide. While exact figures of affected
residents in Palo Alto are unavailable, we recognize the potential impact on our community and
have proactively identified flexible utility billing measures such as partial payment or
postponement of utility bill payments, term repayment arrangements, suspension of late fees,
and expedited access to CPAU financial assistance programs that will support our affected RAP
residential customers and federal employees during the current shutdown.
BACKGROUND
As of this writing, the federal government financial closure is now the longest continuous
federal government lockdown in history. Federal government employees who have been
furloughed or dismissed, essential workers who are legally required to work without paychecks,
and rate assistance customers who may be impacted due to suspension of other federal
benefits programs are facing the financial impacts beyond their control.
ANALYSIS
In order to help customers who are having difficulty paying their utility bills, CPAU currently
administers bill repayment scheduling, as well as residential financial assistance on a routine
basis through the RAP and ProjectPLEDGE, a community-funded utility bill grant program.
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However, due to the unique nature of the federal shutdown, staff believes that it would be
helpful to create a special program that temporarily defers late charges and collection actions
for customers who are likely to be impacted by the shutdown.
with respect to
utility charges incurred during the shutdown:
FISCAL/RESOURCE IMPACT
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STAKEHOLDER ENGAGEMENT
ENVIRONMENTAL REVIEW
ATTACHMENT:
APPROVED BY:
ATTACHMENT A NOT YET APPROVED
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027110625
Resolution No.
Resolution of the Council of the City of Palo Alto Deferring CPAU Late Fees and
Collection Actions for Certain Customers Affected by the Ongoing Federal Government
Shutdown
R E C I T A L S
A. Since October 1, 2025 the Federal Government has been operating without
funding appropriations.
B. Until appropriations are approved and go into effect, the Federal Government is
“shutdown.”
C. During the shutdown many payments normally made by the Federal
Government have been suspended; these suspended payments include wage payments to
federal employees and payments to states that support certain food assistance and other
programs.
D. It is not clear at this time how long the shutdown will persist.
E. Many Palo Alto residents are federal employees or are recipients of assistance
that has been disrupted by the shutdown.
F. The City’s utility and public work enterprises provide vital services, including
electricity, natural gas, water, sewer, stormwater, and refuse services, to the households of
these residents.
G. As a result of the shutdown-related disruption to household cashflow, many of
these households are anticipated to encounter temporary difficulty in paying their bills.
H. It is vital to the public health and safety that the City not disrupt public services
to those most affected by the shutdown.
I. Pursuant to Chapter 12.20.010 of the Palo Alto Municipal Code, the Council of
the City of Palo Alto may by resolution adopt rules and regulations governing utility services,
fees and charges.
J. The City Council desires to defer certain consequences of non-payment of utility
bills for residential customers that are most directly affected by the shutdown.
The Council of the City of Palo Alto RESOLVES as follows:
SECTION 1. During the Shutdown Period and the Recovery Period as it pertains to
charges incurred during the Shutdown Period, the City will not, in connection with an Enrolled
Account: (i) apply late charges, (ii) take collection actions such as referring an account to a
ATTACHMENT A NOT YET APPROVED
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027110625
collection agency or bringing civil action, (iii) initiate termination or disconnection of services,
(iv) lower the internal credit risk assessment for the accountholder or account, or (v) report
non-payment to any external credit reporting agency.
SECTION 2. For any accountholder of an Enrolled Account, the Administrator may
create a payment plan for the Enrolled Account that requires that the balance unpaid at the
end of the Shutdown Period be paid in installments during the Recovery Period.
SECTION 3. The Administrator is authorized to promulgate procedures and rules for
the administration of this Resolution consistent with the provisions of this Resolution. The
Administrator may require that any request made by an accountholder pursuant to this
Resolution be made in a manner or in a format required by the Administrator.
SECTION 4. For purposes of this Resolution, the following terms have the following
meanings:
A. “Administrator” means: The Utilities Director or his designee.
B. “Enrolled Account” means: Any residential CPAU Account (other than a
multifamily account that covers more than one dwelling unit) that either (i) is
enrolled in the CPAU Rate Assistance Program or (ii) serves a Federal Employee
Dwelling Unit, where the accountholder applies to the City for such treatment,
and establishes that a dwelling unit served in connection with the account is a
Federal Employee Dwelling Unit, in a manner to be designated by the
Administrator.
C. “Federal Employee Dwelling Unit” means: A residential dwelling unit at least one
of the occupants of which was employed by the United States Government on
October 1, 2025.
D. “Shutdown Period” means: The period beginning on October 1, 2025 and ending
on the day that an appropriations bill funding the federal government becomes
law.
E. “Recovery Period” means: A 365-day period that begins on the day following the
end of the Shutdown Period.
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ATTACHMENT A NOT YET APPROVED
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027110625
SECTION 5. The Council’s adoption of this Resolution and the actions taken herein
do not require review under the California Environmental Quality Act because they do not
meet the definition of “project” set forth in Public Resources Code Section 21065 nor the CEQA
Guidelines, 14 CCR section 15378(b)(5).
INTRODUCED AND PASSED:
AYES:
NOES:
ABSENT:
ABSTENTIONS:
ATTEST:
City Clerk Mayor
APPROVED AS TO FORM: APPROVED:
Assistant City Attorney City Manager
Director of Utilities
Director of Administrative Services