Title
Recommendation to Authorize the City Manager to Execute the Second Amendment to the Agreement with the Friends of the Alameda Animal Shelter to Increase Fiscal Year 2024-2025 Expenditures by $267,692, for a Total of $1,424,994 in Fiscal Year 2024-25 and a Total 10-Year Agreement Not-to-Exceed $12,028,331. (City Manager 10021030)
Body
To: Honorable Mayor and Members of the City Council
From: Jennifer Ott, City Manager
EXECUTIVE SUMMARY
Costs for core state-mandated animal control services have exceeded the amount the City of Alameda (City) budgeted to reimburse the Friends of the Alameda Animal Shelter (FAAS). This staff report and a memo from FAAS (Exhibit 1) detail these cost increases. FAAS is requesting an amendment to the Agreement with the City to increase the current year budget by $267,692, for a total this Fiscal Year (FY) 2024-25 of $1,424,994. This increase will be funded by vacancy savings from the Finance Department available for FY2024-25. The Second Amendment increases the overall compensation to FAAS for a total not-to-exceed of $12,028,331. FAAS is not requesting an increase to future budgets, as its staff anticipates new revenues from the soon to open Animal Medical Services and Training Campus will help offset any future cost increases.
BACKGROUND
Since 2012, the City has maintained a strong public-private partnership with FAAS to provide animal control services in the City. In July 2021, the City entered into an Agreement with FAAS for animal shelter and related operations. The term of the agreement is for two years with up to four two-year extensions.
In September 2023, City Council approved the First Amendment to the Agreement with FAAS for an additional amount of $186,000 for FY 2024-25, which included an annual amount not-to-exceed $1,157,300.
The City’s Agreement with FAAS identifies core state-mandated animal control services that the City is responsible for funding, such as sheltering, necessary medical care, adoption, spay and neuter, licensing and animal care. Additional services are funded by FAAS through their fundraising efforts. FAAS is responsible for funding salaries including a half-time (0.5 FTE) Executive Director, a Medical Director, South Shore adoption center staff, Healthy Pets/Healthy People program staff, and marketing, development and administrative positions.
DISCUSSION
The City’s Agreement with FAAS is on a reimbursement basis, whereby FAAS bills the City monthly for its expenses to conduct core services. FAAS invoices are thoroughly reviewed by the Finance Department to ensure the expenses correspond with the services outlined in the Agreement. In fall 2024, the City’s Finance Department identified that FAAS’ monthly reimbursements were increasing and noted that if costs continued to increase, the Agreement, as amended in July 2023, may not be enough to cover core services. Staff shared this information with FAAS.
In April 2025, the Finance Department again identified that FAAS’ invoices for core services were higher than the Agreement provided for. Staff shared this information with FAAS and the Executive Director expressed the need for additional funding for the remainder of FY 2024-25. On May 8, 2025, the City received a memo from FAAS requesting City funding for FY 2024-25 in the amount of $267,692 to bridge a funding gap caused primarily by an increase in animal intake and an increase in costs for the services the City supports (Exhibit 1).
The funding request memo from FAAS shares the Shelter’s year-over-year intake and live release rate and details how, since 2021, intake numbers have been increasing steadily. As FAAS indicates in the memo, the biggest variable in managing an open-intake animal shelter is the number of animals coming in and their medical and behavior status. FAAS has the core responsibility to maintain public safety, meet community standards for outcomes, and provide hands-on care seven days/week, 365 days/year.
In June 2025, FAAS will be opening a new medical center and launching a new pet licensing system. Both are expected to bring in revenues that will likely offset these increased costs in the coming fiscal years.
ALTERNATIVES
• Authorize the City Manager to execute the Second Amendment to the Agreement with FAAS to increase the FY 2024-2025 budget by $267,692, funded from vacancy savings from the Finance Department.
• Provide alternative direction to staff.
FINANCIAL IMPACT
This Second Amendment would increase the FY 2024-25 compensation by $267,692, to an amount not-to-exceed $1,424,994 in Fiscal Year 2024-25. The overall compensation to FAAS is a total not-to-exceed $12,028,331. There are no changes to the FY 2025-26 budget of $1,215,165 or future budgets.
Vacancy savings from the Finance Department will be used to cover the entire amount of $267,692.
MUNICIPAL CODE/POLICY DOCUMENT CROSS REFERENCE
This action is in conformance with the Alameda Municipal Code and all policy documents.
This action is subject to the Levine Act.
ENVIRONMENTAL REVIEW
This action does not constitute a “project” as defined in California Environmental Quality Act (CEQA) Guidelines Section 15378 and therefore no further CEQA analysis is required.
CLIMATE IMPACT
There are no identifiable climate impacts or climate action opportunities associated with the subject of this report.
RECOMMENDATION
Authorize the City Manager to execute the Second Amendment to the Agreement with FAAS to increase Fiscal Year 2024-2025 expenditures by $267,692, for a total in Fiscal Year 2024-25 of $1,424,994 and a total 10-Year agreement not-to-exceed $12,028,331.
Respectfully submitted,
Sarah Henry, Communications and Legislative Affairs Director
Financial Impact section reviewed,
Ross McCarthy, Finance Director
Exhibits:
1. FAAS Funding Request Memo
2. FAAS Second Amendment
3. FAAS Agreement and First Amendment