Council Sends All $902K in Post Office Proceeds to OPEB Trust in Divided Vote

Pinole's City Council split 3-2 over the most consequential fiscal question of the night — whether to bet on long-term pension health or near-term road repair — while also overhauling more than 200 city fees, adopting electronic campaign filing, and directing staff to draft a solidarity resolution for striking sugar refinery workers.

• $902,500 in post office sale proceeds directed entirely to the OPEB trust in a 3-2 vote, with dissenters pushing for a road maintenance split
• 232 city fees updated, including a new tiered conditional use permit structure that could cut costs nearly in half for small businesses
• Electronic campaign finance filing adopted, joining 250 California cities ahead of the November election cycle
• Council unanimously backs grand jury response, committing to quarterly finance reviews and an OPEB consultant after receiving F grades on pension obligations
• ILWU Local 6 solidarity resolution directed after council member visits striking C&H Sugar Refinery workers in Crockett

---

Roads vs. Retirement: The $902K Fight

Why it matters: The grand jury gave Pinole F grades on pension obligations, OPEB obligations, and OPEB funding — and the council had to decide whether a nearly $1 million windfall from selling the old post office should shore up those liabilities or fix deteriorating roads.

Where things stand: Director Marquisha Gilroy presented GFOA guidance recommending one-time revenues go to reserves, the Section 115 Trust, or unfunded capital improvements. City Manager Kelly said she preferred the funds go to the trust, which holds $13.6 million and earned 10–12% interest annually — about $1.7 million last year — with only $900,000 scheduled for withdrawal in FY 26-27.

Councilmember Maureen Toms moved to direct 100% to the trust. "We need to show the public that we're taking very seriously the grand jury report. And we also need to show the grand jury that we're taking their recommendations seriously," she said. She warned that the trust's interest income funds city budgets and "as that shrinks down, that interest is going to go away."

Councilmember Norma Martinez-Rubin seconded, arguing that pension and OPEB liabilities have no alternative funding source, unlike roads, which could eventually be supported by a general obligation bond.

The other side: Mayor Pro Tem Devin Murphy opposed, insisting the policy shouldn't ignore the grand jury's findings on road maintenance and economic development. "I don't want us to ignore the other findings in the grand jury report, two of which include road maintenance and repavement, which I think we have to, to be disciplined, you have to sometimes manage multiple priorities," he said, requesting staff return with amended language allowing a split.

Councilmember Cameron Sasai also voted no, arguing the finance subcommittee should weigh in first. "As we get briefed on the conditions of our roads and how much money we are putting in year by year, the road quality isn't improving. We're just maintaining and we're barely maintaining and it's going to get more expensive as time goes on," he said, suggesting a 75/25 or 50/50 split between the trust and road maintenance.

Mayor Anthony Tave initially explored whether funds could support economic development but was persuaded that strengthening the trust would make the city more attractive for future bond issuance.

Decisions: The motion passed 3-2 (For: Toms, Martinez-Rubin, Tave; Against: Sasai, Murphy). The policy applies immediately to the $902,500 post office proceeds. Councilmember Toms noted the policy could be revisited annually during budget season.

What's next: The tension between fiscal austerity and infrastructure investment is likely to resurface at budget time and when the finance subcommittee begins its quarterly meetings in September.

---

Pinole Overhauls 232 Fees, Cuts Permit Costs for Small Businesses

Why it matters: More than half of the city's user and regulatory fees hadn't kept pace with the actual cost of providing services. The overhaul brings them current — and creates a new tiered system for conditional use permits designed to lower barriers for small businesses while maintaining full cost recovery for complex projects.

The basics: Consultant Terry Madsen of Clearsource Financial Consulting presented the third and final phase of a comprehensive fee study. Of 232 fees reviewed, 59% increase, 30% remain unchanged or decrease, 8% vary by criteria, one (CUP) is restructured, and six are new. The estimated annual revenue impact is $227,000, effective Oct. 1, 2026.

Where things stand: The most significant change replaces the flat $5,726 CUP fee with three tiers. Tier 1 Minor drops to $4,254 — or $2,552 for qualifying small businesses — while Tier 3 Major rises to $9,176 ($6,882 for small businesses). Madsen described the old system: "Your conditional use permit as it exists today is one base fee. It's sort of a one size fits all fee." City Manager Kelly illustrated the tiers using examples: a martial arts studio would qualify for the lowest tier, while a new bar would require the highest.

New fees include charges for SB9 unit processing, zoning code interpretations, digital media devices for records requests, and two code enforcement research and meeting fees. A proposed business license application review fee was deferred for further time-study analysis.

Councilmember Martinez-Rubin asked detailed questions about fire inspection fee separation between ConFire and the city — staff confirmed they are separate — and about business license review processes. Mayor Pro Tem Murphy asked about SB9 project pipeline, advanced manufacturing CUP classification, and communication strategy for affected businesses.

Public commenter Rafael Menace questioned why multiple fees were set at exactly $1 less than full cost recovery and flagged a mismatch between the consultant's and staff's descriptions of the business license fee.

Decisions: Adopted unanimously 5-0. Madsen assured the council the fees would not make Pinole an outlier: "We believe that Pinole City Council could adopt these fees and feel comfortable that you're adopting fees that align to what other agencies in your region and throughout the state adopt."

---

Grand Jury's F Grades Prompt Quarterly Finance Reviews, OPEB Consultant

Why it matters: The California Policy Center's fiscal health dashboard gave Pinole A grades on reserves, liquidity, and revenue trends — but F grades on pension obligations, OPEB obligations, and OPEB funding. The city's formal response to Grand Jury Report No. 2604 commits to its most concrete fiscal reform steps in years.

Where things stand: City Manager Kelly presented the response, due Aug. 14, 2026. The city agrees with 23 of 26 findings and partially agrees with three — the partial disagreements reflecting the council's June 23 balanced budget that did not use the Section 115 Trust. All six recommendations will be implemented.

Kelly announced quarterly finance subcommittee meetings (September 2026, January, March, and June 2027), an infrastructure subcommittee meeting in January 2027, and plans to hire an OPEB consultant to benchmark retiree healthcare plans. She committed to a town hall in the second half of the fiscal year: "I don't want it just directly about the civil grand jury report. If I have a town hall meeting, it'll be about Pinole and its vision in light of the civil grand jury report."

Councilmember Sasai noted the finance subcommittee had been underutilized, saying it "really only met once or twice a year" during his time as mayor, and encouraged more frequent use. Councilmember Martinez-Rubin requested a less formal town hall format for public engagement, which Kelly agreed to host.

Public commenter Rafael Menace caught a numbering error in the response (finding 12 vs. 13), which Kelly acknowledged and agreed to correct. Stephen Tilton praised the new city manager's openness.

Decisions: Approved 5-0 with the numbering correction.

---

Solidarity for Striking Sugar Workers

Councilmember Sasai reported visiting ILWU Local 6 workers striking at the C&H Sugar Refinery in Crockett and learning that many strikers are Pinole residents. He moved for staff to draft a formal resolution and letter of support expressing solidarity with the union, recognizing collective bargaining, and urging a fair and immediate resolution.

Councilmember Toms added a friendly amendment: the item would not be needed if the strike is settled before the September meeting. The motion passed 5-0.

---

Campaign Finance Goes Digital

City Clerk Heather Bell Spears presented an ordinance requiring electronic filing of campaign disclosure statements through the Netfile system, already used by 250 California cities including Contra Costa County, Antioch, Concord, Martinez, and Richmond. Pinole previously relied on paper filings requiring significant staff handling. The change will make campaign finance data publicly available online within 72 hours of filing deadlines — a transparency upgrade ahead of the November election cycle.

Councilmember Martinez-Rubin asked about the relationship between Netfile and FPPC online filing; the clerk clarified Netfile transmits directly to the FPPC and the ordinance covers 400-series campaign forms. First reading was waived; second reading is scheduled for Sept. 1. Approved 5-0.

---

Minor Items

• Pinole Valley Road assessment renewed 5-0. Maximum per-parcel rates reach $699.96 (Zone A, north of I-80) and $660.80 (Zone B, south). Public commenters Richard Kossel and Anthony Vosbrink urged the city to negotiate delegated maintenance agreements with Caltrans for freeway on/off-ramp areas, citing reimbursement programs of up to $400,000 in other California cities.
• Professional memberships audit ordered. Mayor Pro Tem Murphy won a 4-1 vote (Martinez-Rubin dissenting) to place a cost-benefit analysis of the city's professional association memberships on the September agenda.
• Capital projects update continued to September due to staff absence.
• Consent calendar approved 5-0 without discussion.
• City Clerk announced meeting minutes will shift to a brief action-style format due to budget reductions — a change that could reduce the detail available to the public at a time of heightened fiscal scrutiny.
• City Manager Kelly reported: Summer camp enrollment surged from 12–17 to 40 participants with waitlists; the senior center is operating as a cooling center; a police backpack giveaway is set for Aug. 13; sewer lateral compliance policies will be reviewed in August with recommendations in September; and an Active Transportation Plan workshop is scheduled for July 23 at the Public Safety Building.
• Bastille Day proclamation read celebrating democratic values.
• Meeting adjourned in remembrance of Tita Pearl Parmley Cabrera, a Filipino community leader and Pinole resident.