Title
Report regarding a resolution approving a sixth amendment to the agreement with JobTrain, Inc. for workforce development support services in an amount not to exceed $75,835 and a sixth amendment to the agreement with Renaissance Entrepreneurship Center for entrepreneurship development services in an amount not to exceed $184,165. (Michael Guss, Economic Development Specialist)
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RECOMMENDATION
Recommendation
Staff recommends that the City Council adopt a resolution approving a sixth amendment to the agreement with JobTrain, Inc., not to exceed $75,835 until funds are exhausted or December 31, 2025, whichever occurs sooner, and a sixth amendment to the agreement with Renaissance Entrepreneurship Center, not to exceed $184,165 until funds are exhausted or December 31, 2025, whichever occurs sooner.
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BACKGROUND
The City established the Economic Advancement Center (EAC) with a $2 million General Fund appropriation in 2021. The EAC was designed as a Covid-19 recovery program. The main goal of the EAC was to assist South San Francisco residents during the Covid-19 pandemic who were displaced from employment or had their small businesses impacted generate income quickly as Covid relief funds waned.
A central reason for creating the EAC was that North San Mateo County was a resource desert prior to, during, and immediately after, the Covid-19 pandemic. Many individuals who could have benefited from Covid-19 relief programs were not able to apply because the locations that served South San Francisco were based in Redwood City, San Francisco, and Sunnyvale.
The City conducted a Requests for Qualifications (RFQ) process to select a workforce development service provider and a small business/entrepreneurship counseling and development provider. As a result of the twin RFQs, JobTrain, Inc. was selected as the workforce development provider and Renaissance Entrepreneurship Center was selected as the small business development provider.
Grant Funding for the EAC
As the Covid-19 pandemic receded, the EAC was successful in obtaining several grants to support continued operations.
In February 2022, the City received a $1.132 million grant from the United States Department of Commerce, Economic Development Administration (EDA) to support small business development and entrepreneurial development services at the EAC. The EDA grant funded the EAC’s small business programs from March 2022 through December 31, 2024. All funds have been expended, the City has received the full $1.132 million from EDA; the City also received a closeout letter in May 2025.
In May 2023, the City received a $500,000 grant from the United States Department of Labor. This project was made possible through the work of former Congressmember Jackie Speier, who submitted an earmark request on the City’s behalf. This grant paid for roughly half of the EAC’s workforce development programs from 2023 through May 31, 2025.
In July 2023, the City received a $1 million appropriation from the Office of State Senator Josh Becker. This could support operations of the EAC, including space, workforce development services, and small business development/entrepreneurial services. This earmark has funded the cost of leasing the EAC and filled gaps in workforce development and small business funding over the past two years.
In October 2024, the City received a $270,000 grant from San Mateo County Measure K funds designated by Supervisors Pine and Canepa to fund workforce development services, small business development services, and the Promotores Program. This grant requires $184,165 to be spent on Renaissance Entrepreneurship Center’s small business development programs, $75,835 on JobTrain’s workforce development services, and $10,000 on the Promotores Program. This funding remains available to spend down.
The grants described above shifted the focus of the EAC from Covid-19 recovery to economic mobility services and expanded the service area of the EAC from the City of South San Francisco to a regional area including the communities of Brisbane, Colma, Daly City, Pacifica, Millbrae, and San Bruno.
Previous Renaissance & JobTrain Contract Amendments, and Clients Served
Since 2021, the City Council has approved four cost extension amendments to the contract with Renaissance Entrepreneurship Center and four cost extensions to the contract with JobTrain, Inc. They are as follows:
Renaissance Entrepreneurship Center:
|
Year |
Contracted Amount |
|
2021 |
$467,000 |
|
2022 |
$568,128 |
|
2023 |
$573,327 |
|
2024 |
$425,000 |
|
Total |
$2,033,455 |
As a result of this investment, 262 businesses received technical assistance, 41 business launched, and 543 jobs were created or retained (246 created and 297 retained).
Since 2021, City Council has approved four cost extension amendments to the contract with JobTrain, Inc. They are as follows:
JobTrain, Inc.
|
Year |
Contracted Amount |
|
2021 |
$403,916 |
|
2022 |
$469,200 |
|
2023 |
$515,387 |
|
2024 |
$387,613 |
|
Total |
$1,776,116 |
As a result of this investment, 357 individuals obtained employment at an average wage of $22.46 per hour (total earned varied from $15 an hour to $75 per hour); the total annual wages of JobTrain clients who obtained employment through the EAC is $16.67 million per year. This is roughly a 939% annual return on funds expended on workforce development services.
Future Funding for the EAC
While the EAC has been a success, and the services valuable to South San Francisco residents as well as residents of nearby communities, the City’s ability to subsidize the services offered at the EAC is coming to an end. Since 2022, services at the EAC have been significantly subsidized through federal and state grants. Since 2022, the federal government has pulled back funding across the board, and the state government went from record surpluses to significant deficits. The City now faces a significant structural deficit as well, leaving the City in a position where it can no longer guarantee General Fund funding for the EAC.
Housing Division staff identified a way to pay for the cost of the EAC facility. The Permanent Local Housing Allowance (PLHA) can pay for facility costs to host services that assist people in avoiding homelessness. The services provided at the EAC are services that assist people with avoiding homelessness, and are therefore eligible under PLHA. Staff is currently evaluating a lease extension at the current EAC facility or moving the EAC to another location.
Service provider JobTrain was successful in obtaining a large grant from the State of California. Their $3 million grant will pay for job placement services (with a specific focus on individuals re-entering society after serving time in jail or prison) in San Jose, East Palo Alto, North Fair Oaks, and South San Francisco. Our understanding from speaking with JobTrain staff is that the grant pays for 75% of the Career Specialists’ salaries who work at the EAC between June 1, 2025, and May 31, 2028.
Renaissance and JobTrain are working together with the support of City staff to solicit funds from private foundations. Promising conversations have occurred with one prominent foundation and asks have been made at several others.
City staff is engaged in a planning process to examine the feasibility of locating a Financial Empowerment Center (FEC) within the EAC. FECs provide 1:1 financial counseling to individuals; this focuses on establishing a bank account, reducing debt, creating savings plan, establishing credit and increasing credit scores. Financial counseling can be provided for a myriad of reasons, including obtaining more suitable housing, buying a home, buying a car, etc. Limited services for business owners are provided by FECs; these services focus on detangling the personal and business finances of microentrepreneurs. FECs can also make referrals to service providers, such as Small Business Development Centers, when they are unable to provide the services clients are seeking. If an FEC is found to be feasible, the City would issue an RFP for services, and the services would likely be located within the EAC.
By allocating the $260,000 remaining in the Measure K discretionary grant provided by Supervisors Pine and Canepa in 2024 to cost-extensions for Renaissance Entrepreneurship Center and JobTrain, Inc., the City will be able to provide services at the EAC through the Fall. This will allow the FEC planning process to be completed, and philanthropic fundraising to continue.
DISCUSSION
City Council could elect to cease EAC operations on July 1, 2025, when the existing contracts expire (the lease runs through August). However, because of JobTrain’s state funding, this would likely mean that services would be moved to another community, such as San Bruno, Daly City, or Brisbane in North San Mateo County. Ceasing EAC operations on July 1, 2025, would leave entrepreneurs in South San Francisco without services and would re-establish the service desert that the EAC was established to address. This would also require the City to return the $260,000 that the County awarded to the City to provide services at the EAC.
In October 2024, the City Council passed Resolution 158-2024, which approved Budget Amendment Number 25.022. As a result, these funds were appropriated for the appropriate projects. No further budget appropriation is necessary; the proposed resolution merely authorizes amendments to the service provider contracts to expend grant monies already accepted and budgeted by City Council.
Finally, because the Permanent Local Housing Allocation can pay for space and because the County Discretionary Grant can pay for the extensions, there is no impact to the General Fund to approve this resolution.
Approving this resolution would allow the City and its nonprofit partners appropriate time to transition services at the EAC and adapt the EAC model to changing conditions.
FISCAL IMPACT
There is no impact to the General Fund associated with adopting the resolution.
CONCLUSION
Short-term extensions through December 31, 2025 give staff the time to complete planning processes and nonprofits time to transition to a model where the City provides the space to operate the EAC but does not directly fund services provided at the EAC.
Attachments:
1. Resolution 158-2024
2. Executed Grant Agreement Between County of San Mateo and City of South San Francisco