Loading...
HomeMy WebLinkAboutStaff Report 2605-6368CITY OF PALO ALTO Policy & Services Committee Special Meeting Tuesday, August 11, 2026 6:00 PM     Agenda Item     2.Recommend that City Council approve the HSRAP Grant Program expansion , Staff Presentation 1 0 0 0 2 Policy & Services Committee Staff Report From: City Manager Report Type: ACTION ITEMS Lead Department: City Manager Meeting Date: August 11, 2026 Report #:2605-6368 TITLE Recommend that City Council approve the HSRAP Grant Program expansion RECOMMENDATION Staff recommends that the Policy & Services Committee recommend Council approve a proposed HSRAP+ approach and associated funding levels and timeframe. EXECUTIVE SUMMARY This report recommends an expanded Human Services Resource Allocation Process, referred to as HSRAP+, for the FY 2028-29 funding cycle building from the City Council direction as part of the FY 2027 budget process. HSRAP+ would create a transparent pathway for nonprofit programs that address demonstrated community needs but do not fit within existing HSRAP priorities or other City funding processes. HSRAP+ builds on Council direction following the suspension of the Nonprofit Partnership Workplan Phase I pilot in FY 2027, and expressed interest in determining whether HSRAP funding levels, eligibility, or scope should be modified to better accommodate innovative or non-human services nonprofit programs serving Palo Alto residents. Core HSRAP funding would continue to prioritize direct human services for low-income and vulnerable Palo Alto residents, and HSRAP+ would expand with additional funding appropriation. Staff recommends considering an additional HSRAP+ allocation of $100,000 to $200,000, subject to a recommendation by this Committee and Council budget appropriation. The pilot would align with the regular HSRAP timeline; policy review in FY 2027 and award recommendations in FY 2028. Committee recommendation is requested on the proposed model, funding range, and implementation approach before staff returns with refined recommendations for Human Relations Commission and City Council consideration. 1 0 0 0 2 BACKGROUND 1, the City Council reviewed the purpose of the NPW Phase I pilot and discussed potential improvements for FY 2027. As part of that discussion, staff presented an inventory of nonprofit grants and service agreements over $10,000 to provide a broader overview of City funding relationships with nonprofit organizations beyond Phase I grants. The inventory illustrated the range and complexity of those relationships, which were estimated to total approximately $6.6 million in FY 2027 across multiple funding sources. Council discussion generally reflected interest in a transparent, equitable, and consistent framework for nonprofit funding, including clearer guidance regarding how different types of nonprofit requests should be categorized, reviewed, and funded. Multiyear service agreements are a significant body of work that will be brought to the Committee later this year. 2, Council also recognized the City’s fiscal constraints, including projected FY 2027 budget pressures. In that context, Council supported proceeding without additional NPW Phase I grant funding in FY 2027 and indicated that grant and award funding should, where appropriate, be considered through HSRAP. Council also acknowledged that some nonprofit requests considered through Phase I may not fit within current HSRAP eligibility criteria and expressed interest in evaluating whether HSRAP funding levels, eligibility, or scope should be modified in the future. 1 April 6, 2026, City Council Meeting: https://recordsportal.paloalto.gov/WebLink/DocView.aspx?id=87042&dbid=0&repo=PaloAlto 2 May 11, 2026, City Council Meeting: https://recordsportal.paloalto.gov/WebLink/DocView.aspx?id=88043&dbid=0&repo=PaloAlto 1 0 0 0 2 This report presents options for Committee consideration regarding a potential expanded HSRAP scope, related funding considerations, and an implementation timeline. ANALYSIS HSRAP Expansion 1 0 0 0 2 even if those needs fall outside the traditional human services priority categories. This also provides a pathway for a more varied portfolio of organizations to access City funding. All proposers must demonstrate that their program responds to an identified community need, meets the established proposal evaluation criteria, and does not duplicate an existing City- funded program or established funding mechanism. HSRAP+ Funding Options HSRAP 5 5 FY 2026 Nonprofit Service Agreements, Page 9: https://recordsportal.paloalto.gov/WebLink/DocView.aspx?id=87042&dbid=0&repo=PaloAlto 1 0 0 0 2 staff anticipates recommending Council approval of $998,992 in FY 2028 and $1,027,620 in FY 2029. HSRAP+ HSRAP+ Funding Option Item Funding Notes 1 0 0 0 2 HSRAP+ (Proposed FY 2028 additional allocation for expansion) $100,000-$200,000 Proposed additional appropriation for HSRAP+ expansion; calculated based on last year’s unfunded nonprofit requests not receiving direct allocations Total Available for Grant Allocation $1.1 M-$1.2 M A $100,000-$200,000 allocation would also create a practical starting funding level for evaluating whether HSRAP+ should continue in future years. It is large enough to support multiple nonprofit partners or program areas but limited enough to allow staff and the Human Relations Commission to assess demand, applicant quality, implementation feasibility within existing resource levels, and community impact before recommending any long-term funding structure. In addition, establishing HSRAP+ as a separate appropriation would create a clearer distinction between the City’s longstanding HSRAP funding priorities and proposals that respond to other identified or emerging community needs. HSRAP+ Timeline Consideration of HSRAP+ is well-timed, as the regular HSRAP cycle typically begins in September. The proposed schedule would incorporate HSRAP+ into the existing HSRAP timeline without delaying nonprofit awards. The table below compares the current HSRAP timeline with the proposed HSRAP+ expansion. Key milestones include a proposed joint Policy and Services Committee/Human Relations Commission meeting in September, Council direction on funding levels in October, and Policy and Services Committee award recommendations to Council in May. This would differ from the current process, in which the Finance Committee typically reviews and approves HSRAP funding award recommendations as part of the annual budget. The proposed change reflects the fact that Council’s initial referral was made to the Policy and Services Committee, and the proposed HSRAP+ framework would be developed as part of that Committee’s workplan and policy discussion. As a result, it would be appropriate for Policy and Services to review recommendations related to the structure, criteria, and implementation of HSRAP+, including how the expanded applicant pool would be evaluated and incorporated into the City’s broader human services funding framework. This approach would not eliminate the Finance Committee’s role in the funding process. The Finance Committee would retain its role through the annual budget review, including the ability to review and make recommendations on overall HSRAP+ funding levels as part of the City’s broader budget deliberations. In this way, Policy and Services would provide policy direction and oversight for the program framework that originated from its referral, while Finance would continue to have input on the overarching allocation of City funds through the budget. 1 0 0 0 2 Current and Proposed Timeframe P&S to discuss HSRAP expansion opportunities Survey nonprofits & clients on human service needs Survey nonprofits & clients on human service needs Joint P&S/HRC meeting on HSRAP+ feedback HRC sets Priority of Needs HRC sets Priority of Needs Council to approve HSRAP+ funding levels Nonprofit engagement on HSRAP process Nonprofit engagement on HSRAP+ process Application period opens Application period opens Application period closes Application period closes Review committee evaluates applications HRC recommends awards Review committee evaluates applications HRC reviews and recommends awards Finance Committee reviews HRC award recommendations P&S reviews HRC award recommendations Council approves HSRAP awards Council approves HSRAP+ awards Staff seeks Committee direction on the proposed timeframe and feedback on successful discussion outcomes with the HRC proposed for September 2026. This discussion does not have a fiscal impact, however a recommendation to Council will impact FY 2028 budgeting direction. Community members, nonprofit partners, and service recipients will be surveyed regarding human service needs and notified of upcoming meetings, including information sessions on the HSRAP+ pilot. Additionally, the City’s website will be updated to clearly communicate program changes, key dates and the overall timeline. 1 0 0 0 2 ENVIRONMENTAL REVIEW APPROVED BY: August 11, 2026 www.paloalto.gov HSRAP Grant Program Expansion FY 2027 Nonprofit Funding Level: •Suspended Nonprofit Partnership Workplan Phase I grant process in FY 2027 •FY 2027 Budget Direct Allocations (Ongoing) = $78,280 •FY 2027 Additional Direct Allocations = $235,000 •Policy & Services Committee to consider HSRAP expansion 2 City Council Direction New additional, limited funding path for nonprofit programs addressing community needs identified through the needs assessment, that do not fall within the adopted HSRAP Priority categories. •Ensures that all nonprofit requests are handled through a clear, transparent and predictable process (not during budget adoption process). 3 HSRAP Expansion Top Priorities Other Proposals Original model. No proposed changes or reduction in funding. •Award recommendations based on alignment with Priority of Needs HR A P + •Priority of needs to determine evaluation criteria •Proposals must demonstrate program/service responds to an identified community need, meets established evaluation criteria, and does not duplicate an existing City funded program. •Demonstrates clear public value, which may include improved outcomes, broad reach, increased equity, better coordination, earlier intervention or service population, unaddressed issue area. •Proposal must include a clear scope of work, organizational readiness, realistic budget, feasible timeline, and measurable outcomes. 4 HSRAP Guiding Principles and Best Practices •The Priority of Needs Survey identifies the top 4–5 service priorities for Palo Alto.HSRAP+may further expand, refine, or clarify these priorities. •The Human Relations Commission (HRC)reviews and adopts the service priorities by accepting, rejecting, or modifying them. Adopted priorities are used as criteria for evaluating funding applications. •Applications are submitted by eligible human service providers. •The HRC evaluates applications using the adopted priorities and additional evaluation criteria, including the provider’s delivery of services to Palo Alto residents and demonstrated funding sources beyond the City. •The HRC’s funding allocation recommendations are reviewed by the Finance Committee and forwarded to the City Council for final consideration. •The City Council takes final action by approving, rejecting, or modifying the HRC recommendations. 5 HSRAP Process •Priority of Needs Survey identifies the top 4–5 service priorities for Palo Alto; HSRAP+ may expand or refine these priorities. •HRC reviews and adopts priorities by accepting, rejecting, or modifying them to serve as application evaluation criteria. •Applications are received from eligible service providers. •HRC evaluates applications based on adopted priorities and additional criteria, including Palo Alto service delivery and diverse funding sources beyond the City. •City Council takes final action by approving, rejecting, or modifying HRC recommendations. 6 HSRAP Process Staff recommends keeping existing HSRAP funding methodology. •On average City funds 78% of HSRAP funding requests •HSRAP is one of many ways in which the City supports nonprofit partnerships. In FY27 about $6 million will support contracts for service and grants. •HSRAP funding level increases annually through CPI adjustments. Funding in FY 2028 anticipates Council approval of $998,992 and $1,027,620 in FY 2029. •HSRAP funding is augmented by the Emerging Needs Fund with $50,000 set annually. 7 HSRAP Funding Recommendation Staff recommends adding an allocation of $100,000-$200,000 for HSRAP+ expansion. •Recommended range aligns with demonstrated level of eligible but unfunded demand identified through the NPW Phase I pilot. •Meaningful but limited expansion that preserves the majority of funding for HSRAP priority of needs. •Feasible for existing staffing to absorb and manage. 8 HSRAP+ Funding Recommendation 9 HSRAP+ Timeline Month Current HSRAP Key Dates Proposed HSRAP+ Key Dates August •P&S to discuss HSRAP expansion opportunities •Survey nonprofits & clients on human service needs September Survey nonprofits & clients on human service needs Joint P&S/HRC meeting on HSRAP+ feedback October HRC sets Priority of Needs HRC sets Priority of Needs Council to approve HSRAP+ funding levels November Nonprofit engagement on HSRAP process •Nonprofit engagement on HSRAP+ process •Application period opens December Application period opens January Application period closes Application period closes February Review committee evaluates applications March HRC recommends awards Review committee evaluates applications April HRC reviews and recommends awards May Finance Committee reviews HRC award recommendations P&S reviews HRC award recommendations June Council approves HSRAP awards Council approves HSRAP+ awards 10 Joint P&S and HRC Meeting Staff seeks Committee feedback on successful discussion outcomes with the Human Relations Commission (HRC) proposed for September 2026. •What would you like to learn from HRC? 8 9 Recommendation That Policy & Services: •Recommend that the City Council approve the HSRAP grant program expansion •Provide feedback on proposed expansion model, funding range and implementation approach in preparation for joint P&S and HRC meeting. Lupita Alamos, Assistant to the City Manager Sophie Pigman, Human Services Manager lupita.alamos@paloalto.gov August 11, 2026