San Leandro council approves ARPA reallocation; finance staff to restore Lake Chabot funding in January

The San Leandro City Council voted 7–0 to adopt a resolution reallocating $1.6 million in American Rescue Plan Act (ARPA) funds to ensure the city meets federal deadlines for obligating those grants.

Council members, city staff and several nearby residents debated whether the swap would imperil design and stabilization work for Lake Chabot Road, a collector street and evacuation route that has been closed for about two years. City staff said the move is a timing maneuver to keep ARPA money “in contract” before the federal deadline and that the council will see a reappropriation in January to replenish project funding.

The council's action matters because ARPA rules require that awarded funds be contractually obligated by a specific deadline or risk being forfeited. City staff told the council the reallocation swaps general-fund appropriations and does not eliminate the city's commitment to projects, including Lake Chabot Road stabilization.

City manager (unnamed) explained the rationale during the consent-item discussion: “ARPA has regulations that all monies that have been given for the ARPA fund, have to be obligated or encumbered by December 31, 2024, which means we have to be in contract on that money.” Public Works Director Sheila Marquesas said the original $1,000,000 ARPA allocation, approved in 2022, was intended as seed money to “supplement the project's design and construction” and that further construction funding would require additional council actions.

Several residents from the Lake Chabot area urged the council to ensure the swapped funds return to the stabilization project. Payal Vora, a resident and structural engineer, offered to volunteer pro bono to help identify geotechnical consultants and urged the city to speed studies and contracting. Anne Caywood and Helen Cataldo described Lake Chabot Road as a vital evacuation route and asked the council to prioritize repairs.

Interim finance director Heather Rowden said staff would return to council in January with the reappropriation plan. “We will bring that back, as soon as possible,” she said. Council members pressed for clearer language in the resolution but several said their votes in favor reflected an intent that the Lake Chabot funds be restored when staff can obligate contracts for design and stabilization work.

Action taken: Council member Aguilar moved to adopt the ARPA reallocation resolution; the motion was seconded by Council member Baloo and carried unanimously. Council members present at roll call included Mayor Mary Gonzales, Vice Mayor Simon, Council members Aguilar, Azevedo, Baloo, Bowen and Viveiros Walton. Staff said no project is being defunded; the reallocation is intended to preserve ARPA eligibility and will be tracked through a future budget action.

City staff also told the council that a design consultant for Lake Chabot stabilization is expected to be awarded at an upcoming meeting and that environmental studies required under planned federal funding (Federal Highway Administration) remain necessary before construction can proceed. Council members and speakers emphasized that the geotechnical study—an item discussed in the Facilities Committee—remains a priority and could be paid for from project funds and later replenished when staff returns the ARPA swap.

The council adopted the resolution as presented; staff will return in January with the reappropriation and more detailed budget language for how money earmarked previously for Lake Chabot Road will be restored and spent.