HomeMy WebLinkAboutStaff Report 2511-5436CITY OF PALO ALTO
CITY COUNCIL
Monday, December 01, 2025
Council Chambers & Hybrid
5:30 PM
Agenda Item
19.Approval of Amendments to the Employment Agreements between the City of Palo Alto
and Council Appointed Officers, specifically the City Manager, City Attorney, and City
Clerk. CEQA Status - Not a Project Public Comment
City Council
Staff Report
From: City Manager
Report Type: ACTION ITEMS
Lead Department: Human Resources
Meeting Date: December 1, 2025
Report #:2511-5436
TITLE
Approval of Amendments to the Employment Agreements between the City of Palo Alto and
Council Appointed Officers, specifically the City Manager, City Attorney, and City Clerk. CEQA
Status - Not a Project
RECOMMENDATION
Staff recommends that the City Council approve and authorize the Mayor to execute the
following contract amendments for Council Appointed Officers:
1. Amendment No. 13 to Employment Agreement between the City of Palo Alto and Molly
S. Stump (Attachment A);
2. Amendment No. 7 to Employment Agreement between the City of Palo Alto and
Ed Shikada (Attachment B); and
3. Amendment No. 2 to Employment Agreement between the City of Palo Alto and
Mahealani Ah Yun (Attachment C).
BACKGROUND
The City Council has completed the annual merit reviews for Council Appointed Officers (CAOs):
City Attorney Molly S. Stump, City Manager Ed Shikada, City Clerk Mahealani Ah Yun for the
prior fiscal year’s performance (FY 2025).
For the FY 2025 performance evaluation period, City Council completed evaluations for the City
Attorney, City Manager, and City Clerk. Council completed the evaluations with the assistance
of an outside consultant. The consultant, a professional with the firm Municipal Resource
Group (MRG), facilitates CAO evaluations for public agencies throughout California. The process
includes surveys, 1-1 interviews, and facilitated closed session discussions as appropriate under
the Brown Act.
As appointed officers of the Council, the City Attorney, City Manager, and City Clerk are
employed under employment agreements specifying that performance and salary are
evaluated annually. CAO’s do not receive regular cost of living adjustments which are applied to
other employee groups (all Management, Service Employees International Union, International
Association of Firefighters, Palo Alto Police Officers Association, etc.), all salary compensation is
determined by Council during the annual evaluation process and approved by Council in a
public meeting.
ANALYSIS
Salary Adjustments. Not less than once each year, the City Council shall meet for the express
purpose of evaluating the performance of Shikada and determining whether to grant him an
increase in annual base salary based on performance. The City Council will act in good faith in
determining whether to provide an increase based on performance, but the ultimate decision in
this regard is within the sole discretion of the City Council. The Council may also adjust Shikada’s
annual base salary due to labor market and/or internal equity conditions.
City Attorney Molly S. Stump will receive a merit increase of 3% as a City contribution
towards her 401(a) defined contribution retirement plan. (Attachment A)
City Manager Ed Shikada will receive a merit increase of 3%. Shikada‘s new salary will be
$435,510.40 (Attachment B)
City Clerk Mahealani Ah Yun will receive a merit increase and market-based adjustment
to median of the market at $211,764.80 (Attachment C). Council conducted a thorough
review of the Bay Area compensation for City Clerks and found the City Clerk’s salary to
be significantly below the City’s target market. A market-based adjustment is warranted
to ensure alignment with market.
FISCAL/RESOURCE IMPACT
STAKEHOLDER ENGAGEMENT
ENVIRONMENTAL REVIEW
ATTACHMENTS
APPROVED BY:
1
AMENDMENT NO. THIRTEEN TO EMPLOYMENT AGREEMENT
BETWEEN THE CITY OF PALO ALTO AND
MOLLY S. STUMP
This AMENDMENT NO. THIRTEEN to the EMPLOYMENT AGREEMENT(“Agreement”)
is entered into on December 1, 2025, by and between the CITY OF PALO ALTO, a California
chartered municipal corporation (“City”), and MOLLY S. STUMP (“Stump”), an individual,
located at 250 Hamilton Avenue 8th Floor, Palo Alto, CA.
R E C I T A L S:
WHEREAS, the original EMPLOYMENT AGREEMENT between the City of Palo Alto
and Molly S. Stump, attached hereto and incorporated herein as Exhibit “A” was entered
into between the parties for the services of City Attorney on or about April 18, 2011; and
WHEREAS, AMENDMENT NO. ONE to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
March 24, 2014; and
WHEREAS, AMENDMENT NO. TWO to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
December 8, 2014; and
WHEREAS, AMENDMENT NO. THREE to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
February 1, 2016; and
WHEREAS, AMENDMENT NO. FOUR to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
December 12, 2016; and
WHEREAS, AMENDMENT NO. FIVE to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
November 6, 2017; and
WHEREAS, AMENDMENT NO. SIX to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
December 17, 2018; and
WHEREAS, AMENDMENT NO. SEVEN to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
December 17, 2019; and
WHEREAS, AMENDMENT NO. EIGHT to the Agreement, attached hereto and
2
incorporated herein in Exhibit “B” was entered into between the parties on or about June
22, 2020; and
WHEREAS, AMENDMENT NO. NINE to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
December 13, 2021; and
WHEREAS, AMENDMENT NO. TEN to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
November 28, 2022; and
WHEREAS, AMENDMENT NO. ELEVEN to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
December 11, 2023; and
WHEREAS, AMENDMENT NO. TWELVE to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered into between the parties on or about
December 2, 2024; and
WHEREAS, the parties wish to amend the Agreement;
NOW, THEREFORE, in consideration of the covenants, terms, conditions, and
provisions of this Amendment, the parties agree:
SECTION 1.
Section 5.2 of the Agreement, 401(a) Defined Contribution Retirement Plan, is
hereby amended to read as follows:
Effective the first full pay period of July 2025, the City shall contribute Forty Four
Thousand and Forty Six dollars ($44,046) annually, prorated and contributed on the City’s
normal paydays, to a 401(a) retirement plan account established for Stump.
SECTION 2. Except as herein modified, all other provisions of the Contract,
including any exhibits and subsequent amendments thereto, shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties have by their duly authorized
representatives executed this Amendment on the first written date above written.
Attest: City of Palo Alto
Approved as to form: Molly S. Stump
3
Attachments:
EXHIBIT A: EMPLOYMENT AGREEMENT BETWEEN THE CITY OF PALO ALTO AND MOLLY S.
STUMP
EXHIBIT B: AMENDMENTS NO. ONE THROUGH NO. TWELVE.
1
AMENDMENT NO. SEVEN TO EMPLOYMENT AGREEMENT
BETWEEN
THE CITY OF PALO ALTO
AND
EDWARD SHIKADA
This AMENDMENT NO. SEVEN to the EMPLOYMENT AGREEMENT (“Agreement”)
is entered into on, December 1, 2025, by and between the CITY OF PALO ALTO, a California
chartered municipal corporation (“City”), and Edward Shikada (“Shikada”), an individual,
located at 250 Hamilton Avenue 7th Floor, Palo Alto, CA.
R E C I T A L S:
WHEREAS, the original EMPLOYMENT AGREEMENT between the City and Shikada,
attached hereto and incorporated herein as Exhibit “A” was entered between the parties
for the services of City Manager on or about September 18, 2018; and
WHEREAS, AMENDMENT NO. ONE to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered between the parties on or about
December 16, 2019; and
WHEREAS, AMENDMENT NO. TWO to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered between the parties on or about June
22, 2020; and
WHEREAS, AMENDMENT NO. THREE to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered between the parties on or about
December 13, 2021; and
WHEREAS, AMENDMENT NO. FOUR to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered between the parties on or about
November 28, 2022; and
WHEREAS, AMENDMENT NO. FIVE to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered between the parties on or about
December 11, 2023; and
WHEREAS, AMENDMENT NO. SIX to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered between the parties on or about
December 2, 2024; and
WHEREAS, the parties wish to amend the Agreement;
2
NOW, THEREFORE, in consideration of the covenants, terms, conditions, and
provisions of this Amendment, the parties agree:
SECTION 1.
Section 4.1 of the Agreement, Initial Compensation, is hereby amended to read as follows:
4.1. Compensation. At the recommendation of the Palo Alto City Council Appointed
Officers Committee (CAO) and consistent with annual merit practices, effective the
first full pay period following July 1, 2025, Shikada will receive a base annual salary of
Four Hundred Thirty-Five Thousand Five Hundred and ten dollars ($435,510.40). This
amount is subject to authorized or required deductions and withholding, prorated,
and paid on City’s regular paydays. Shikada is an exempt employee under applicable
wage and hour law and his base salary shall be compensation for all hours worked.
The City agrees that the amount of Shikada’s base annual salary will not decrease,
except as part of the permanent decrease that is consistent with the Fair Labor
Standards Act.
SECTION 2. Except as herein modified, all other provisions of the Contract, including
any exhibits and subsequent amendments thereto, shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have by their duly authorized representatives
executed this Amendment on the date first above written.
ATTEST: CITY OF PALO ALTO
City Clerk Mayor
APPROVED AS TO FORM: EDWARD SHIKADA
City Attorney
Attachments:
EXHIBIT A: EMPLOYMENT AGREEMENT BETWEEN THE CITY OF PALO
ALTO AND EDWARD SHIKADA
EXHIBIT B: AMENDMENTS NO. ONE THROUGH NO. SIX TO SHIKADA
1
AMENDMENT NO. TWO TO EMPLOYMENT AGREEMENT
BETWEEN
THE CITY OF PALO ALTO
AND
Mahealani Ah Yun
This AMENDMENT NO. TWO to the EMPLOYMENT AGREEMENT (“Agreement”)
is entered into on, December 1, 2025 by and between the CITY OF PALO ALTO, a California
chartered municipal corporation (“City”), and Mahealani Ah Yun (“Ah Yun”), an
individual, located at 250 Hamilton Avenue 7th Floor, Palo Alto, CA.
R E C I T A L S:
WHEREAS, the original EMPLOYMENT AGREEMENT between the City and Ah Yun,
attached hereto and incorporated herein as Exhibit “A” was entered between the parties
for the services of City Clerk on or about January 22, 2023; and
WHEREAS, AMENDMENT NO. ONE to the Agreement, attached hereto and
incorporated herein in Exhibit “B” was entered between the parties on or about
December 2, 2024; and
NOW, THEREFORE, in consideration of the covenants, terms, conditions, and
provisions of this Amendment, the parties agree:
SECTION 1.
Section 3 of the Agreement, Salary, is hereby amended to read as follows:
At the recommendation of the Palo Alto City Council Appointed Officers Committee (CAO) and
consistent with annual merit practices, effective the first full pay period following July 1, 2025,
Ah Yun will receive a base annual salary of Two Hundred Eleven Thousand Seven hundred and
Sixty-Four dollars ($211,764.80). This amount is subject to authorized or required deductions
and withholding, prorated, and paid on the City's regular paydays. Ah Yun is an exempt
employee under applicable wage and hour law and her base salary shall be compensation for all
hours worked. The City agrees that the amount of Ah Yun's base annual salary will not
decrease, except as part of a permanent decrease that is consistent with the Fair Labor
Standards Act.
SECTION 2. Except as herein modified, all other provisions of the Contract, including
any exhibits and subsequent amendments thereto, shall remain in full force and effect.
IN WITNESS WHEREOF, the parties have by their duly authorized representatives
executed this Amendment on the date first above written.
2
ATTEST: CITY OF PALO ALTO
Mayor
APPROVED AS TO FORM: Mahealani Ah Yun
City Attorney
Attachments:
EXHIBIT A: EMPLOYMENT AGREEMENT BETWEEN THE CITY OF PALO
ALTO AND Mahealani Ah Yun
EXHIBIT B: AMENDMENTS NO. ONE
From:herb
To:Council, City; Clerk, City
Subject:December 1, 2025 City Council Meeting, Agenda Item #19: City Manager Employment Agreement
Date:Sunday, November 30, 2025 4:11:54 PM
CAUTION: This email originated from outside of the organization. Be cautiousof opening attachments and clicking on links.
DECEMBER 1, 2025 CITY COUNCIL MEETING
AGENDA ITEM #19: CITY MANAGER EMPLOYMENT AGREEMENT
When the City Council appointed Ed Shikada as City Manager, nosearch process had been conducted for the position.
As reported in the Palo Alto Weekly at that time, when the CityCouncil appointed Shikada's predecessor James Keene, there were42 applicants, six semi-finalists, several interview panels,and three finalists.
Council Member Tom Dubois said of Shikada's appointment, "Therecould still be an opportunity for the public to comment andweigh in when we do goals and performance reviews and settingcriteria for evaluating the city manager." (See "Ed Shikadanamed next city manager" by Gennady Sheyner in Palo AltoWeeklyof June 29, 2018, at pages 5 and 8.)
Now that the results of the City Council's annual review of theCity Manager's performance have been completed, the Councilstill resists making public the Goals and Key PerformanceIndicators that they use to evaluate the City Manager'sperformance; the annual amendment for each Council AppointedOfficer's compensation is being proposed five months after thefiscal year has started; and amendments to their employmentagreements are placed at the end of a long meeting agendafollowing a long holiday weekend.
Should the public and press just assume that whatever opinionsthey have of the performance of the City Manager and the otherCouncil Appointed Officers are not really about thoseemployees, but that those employees are doing exactly what theCity Council wants them to do, and that the opinions of thepublic and press about those officers performance are reallyopinions about the performance of the City Council?
Thank you for your consideration of these comments.
Herb Borock