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Home My WebLink AboutStaff Report 2607-6557CITY OF PALO ALTO CITY COUNCIL Special Meeting Wednesday, September 09, 2026 Council Chambers & Hybrid 5:00 PM Agenda Item 7.Approval of Amendment No. 1 to Contract No. S25186778 with Municipal Resources Group, LLC to increase the Contract Amount by $85,000 to a Total Not-to-Exceed of $340,000 for Organizational Development Services and Extend the Contract Term by One Year through September 4, 2027; CEQA Status – Not a Project. City Council Staff Report From: City Manager Report Type: CONSENT CALENDAR Lead Department: Human Resources Meeting Date: September 9, 2026 Report #:2607-6557 TITLE Approval of Amendment No. 1 to Contract No. S25186778 with Municipal Resources Group, LLC to increase the Contract Amount by $85,000 to a Total Not-to-Exceed of $340,000 for Organizational Development Services and Extend the Contract Term by One Year through September 4, 2027; CEQA Status – Not a Project. RECOMMENDATION Staff recommends that Council approve and authorize the City Manager or their designee to execute Amendment No 1. to Contract No. S25186778 (Attachment A) with Municipal Resources Group, LLC, to increase the contract amount by $85,000 and to extend the contract term from September 4, 2026, to September 4, 2027, to provide organizational development services as needed. The revised contract not-to-exceed amount is $340,000 for a revised contract term of 4 years. EXECUTIVE SUMMARY Staff proposes an extension to the existing contract with Municipal Resources Group, LLC (MRG) for organizational development services. The City provides employee leadership coaching, professional development, and career advancement training for employees, advancing the City's commitment to a positive work environment and its organizational values through this contract. MRG delivers these services through a team of experienced organizational development professionals. The proposed amendment increases the contract's not-to-exceed amount from $255,000 to $340,000. This increase covers continuation of services provided in prior fiscal years and ensures the City can continue providing coaching and training services through September 4, 2027. The Council Appointed Officer performance evaluation process is outside the scope of this proposed amendment and is under separate contract. BACKGROUND ANALYSIS FISCAL/RESOURCE IMPACT STAKEHOLDER ENGAGEMENT Administrative Services managed the contract amendment process and supporting documentation. Human Resources will continue working with these stakeholders to complete the amendment process. ENVIRONMENTAL REVIEW ATTACHMENTS APPROVED BY: Vers.: Aug. 5, 2019 Page 1 of 4 AMENDMENT NO. 1 TO CONTRACT NO. S25186778 BETWEEN THE CITY OF PALO ALTO AND MUNICIPAL RESOURCE GROUP, LLC This Amendment No. 1 (this “Amendment”) to Contract No. S25186778 (the “Contract” as defined below) is entered into as of September 9, 2026, by and between the CITY OF PALO ALTO, a California chartered municipal corporation (“CITY”), and MUNICIPAL RESOURCE GROUP, LLC, a California limited liability company, located at 1622 D Street, Sacramento, CA 95814 (“CONSULTANT”). CITY and CONSULTANT are referred to collectively as the “Parties” in this Amendment. R E C I T A L S A. The Contract (as defined below) was entered into by and between the Parties hereto for the provision of planning and implementing organization transformation, providing leadership training, and developing a performance management system, as detailed therein. B. The Parties now wish to amend the Contract in order to extend the contract term for one year through September 4, 2027 and increase compensation by Eighty-Five Thousand Dollars ($85,000), from a total not-to-exceed compensation of Two Hundred Fifty-Five Thousand Dollars ($255,000) to a new not-to-exceed total compensation of Three Hundred Forty Thousand Dollars ($340,000), as detailed herein. NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of this Amendment, the Parties agree: SECTION 1. Definitions. The following definitions shall apply to this Amendment: a. Contract. The term “Contract” shall mean Contract No. S25186778 between CONSULTANT and CITY, dated September 5, 2023. b. Other Terms. Capitalized terms used and not defined in this Amendment shall have the meanings assigned to such terms in the Contract. SECTION 2. Section 2 “TERM’’ of the Contract is hereby amended to read as follows: “The term of this Agreement shall be effective as of September 5, 2023 through September 4, 2027 unless terminated earlier pursuant to Section 19 (Termination) of this Agreement.” SECTION 3. Section 4 “NOT TO EXCEED COMPENSATION” of the Contract is hereby amended to read as follows: "!# Vers.: Aug. 5, 2019 Page 2 of 4 “The compensation to be paid to CONSULTANT for performance of the Services shall be based on the compensation structure detailed in Exhibit C, entitled “COMPENSATION,” including any reimbursable expenses specified therein, and the maximum total compensation shall not exceed Eighty-Five Thousand Dollars ($85,000) per year for Four Years, Not to Exceed Three Hundred Forty Thousand Dollars ($340,000.00). The hourly schedule of rates, if applicable, is set out in Exhibit C-1, entitled “SCHEDULE OF RATES.” Any work performed or expenses incurred for which payment would result in a total exceeding the maximum compensation set forth in this Section 4 shall be at no cost to the CITY. Optional Additional Services Provision (This provision applies only if checked and a not- to-exceed compensation amount for Additional Services is allocated below under this Section 4.) In addition to the not-to-exceed compensation specified above, CITY has set aside the not- to-exceed compensation amount of Dollars ($ ) for the performance of Additional Services (as defined below). The total compensation for performance of the Services, Additional Services and any reimbursable expenses specified in Exhibit C, shall not exceed Dollars ($ ), as detailed in Exhibit C. “Additional Services” means any work that is determined by CITY to be necessary for the proper completion of the Project, but which is not included within the Scope of Services described at Exhibit A. CITY may elect to, but is not required to, authorize Additional Services up to the maximum amount of compensation set forth for Additional Services in this Section 4. CONSULTANT shall provide Additional Services only by advanced, written authorization from CITY as detailed in this Section. Additional Services, if any, shall be authorized by CITY with a Task Order assigned and authorized by CITY’s Project Manager, as identified in Section 13 (Project Management). Each Task Order shall be in substantially the same form as Exhibit A-1, entitled “PROFESSIONAL SERVICES TASK ORDER”. Each Task Order shall contain a specific scope of services, schedule of performance and maximum compensation amount, in accordance with the provisions of this Agreement. Compensation for Additional Services shall be specified by CITY in the Task Order, based on whichever is lowest: the compensation structure set forth in Exhibit C, the hourly rates set forth in Exhibit C-1, or a negotiated lump sum. To accept a Task Order, CONSULTANT shall sign the Task Order and return it to CITY’s Project Manager within the time specified by the Project Manager, and upon authorization by CITY (defined as counter-signature by the CITY Project Manager), the fully executed Task Order shall become part of this Agreement. The cumulative total compensation to CONSULTANT for all Task Orders authorized under this Agreement shall not exceed the amount of compensation set forth for Additional Services in this Section 4. CONSULTANT shall only be compensated for Additional Services performed under an authorized Task Order and only up to the maximum amount of compensation set forth for Additional Services in this Section 4. Performance of and payment for any Additional Services are subject to all requirements and restrictions in this Agreement.” "!# Vers.: Aug. 5, 2019 Page 3 of 4 SECTION 4. The following exhibit(s) to the Contract is/are hereby amended or added, as indicated below, to read as set forth in the attachment(s) to this Amendment, which is/are hereby incorporated in full into this Amendment and into the Contract by this reference: SECTION 5. Legal Effect. Except as modified by this Amendment, all other provisions of the Contract, including any exhibits thereto, shall remain in full force and effect. SECTION 6. Incorporation of Recitals. The recitals set forth above are terms of this Amendment and are fully incorporated herein by this reference. (SIGNATURE BLOCK FOLLOWS ON THE NEXT PAGE.) "!# Vers.: Aug. 5, 2019 Page 4 of 4 SIGNATURES OF THE PARTIES IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed this Amendment effective as of the date first above written. CITY OF PALO ALTO __________________________ City Manager APPROVED AS TO FORM: __________________________ City Attorney or designee MUNICIPAL RESOURCE GROUP, LLC Officer 1 By:_________________________ Name:______________________ Title:_______________________ "!# $