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CC - ACTION ITEM: (1) Approval of Organizational Reorganization; (2) Adoption of a Resolution Adopting the Related Classification and Salary Plan for City Employees, Effective January 26, 2026; (3) Adoption of a Resolution Adopting the Updated Executive Compensation Plan, Effective January 26, 2026; and (4) Approval of a Performance Management Framework.
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Meeting Date: January 26, 2026
Contact Person/Dept.: Dana Anderson/Human Resources Director
Phone Number: (310) 253-5640
Fiscal Impact: Yes [X] No [] General Fund: Yes [X] No []
Attachments: Yes [X] No []
Public Notification: (E-Mail) Meetings and Agendas - City Council (01/22/2026)
Department Approval: Dana Anderson, Human Resources Director (1/22/2026) _____________________________________________________________________
RECOMMENDATION
Staff recommends the City Council (1) approve the reorganization of the City Manager’s Office to align the executive leadership structure with the City Manager’s Fiscal Year 2026-2027 strategic priorities; (2) approve the update and reclassification of executive positions and selective department head salary adjustments as described in this report; (3) adopt a Resolution adopting the related City employee salary schedules, effective January 26, 2026; (4) adopt a Resolution adopting the updated Executive Compensation Plan, effective January 26, 2026; (5) approve the establishment of an executive-level Performance Management and Pay-for-Performance framework aligned with City Council priorities, ICMA best practices, and modern talent development principles; and (6) authorize the City Manager to implement the organizational, classification, and compensation changes, including step placement, consistent with qualifications, experience, and internal equity.
BACKGROUND
Over the past several fiscal years, the City has experienced increasing organizational complexity across affordable housing delivery, homelessness response, infrastructure investment, fiscal constraints, and community-facing service delivery. These demands have placed heightened expectations on executive leadership and underscored the importance of organizational capacity, workforce capability, and leadership continuity.
In response, the City Manager evaluated the City’s organizational structure, executive classifications, and compensation framework and identified opportunities to strengthen enterprise-wide leadership capacity while preserving internal equity and fiscal discipline. The proposed changes reflect best practices observed in comparable public agencies and are intentionally designed to support talent acquisition, leadership development, and long-term employee retention, ensuring the City remains competitive in attracting and developing high-performing professionals.
DISCUSSION
Proposed Organizational Structure
The proposed reorganization establishes a streamlined executive structure centered on a Senior Assistant City Manager serving as the City Manager’s principal deputy and second-in-command. The Infrastructure & Innovation executive group reports to the Senior Assistant City Manager, strengthening enterprise-wide coordination, execution, and accountability. Fiscal Sustainability & Transparency is led by an Assistant City Manager reporting directly to the City Manager. The third executive group is Economic Development, Vitality & Equity, which is also led by an Assistant City Manager reporting directly to the City Manager. Talent Development, Labor & Inclusion is led by the Chief Human Resources Officer, who reports directly to the City Manager. Statutory, legislative, and public-facing functions, including the Communications and Public Information Officer, continue to report directly to the City Manager. In addition, the structure establishes a dedicated Performance Management function within the City Manager’s Office to ensure City Council priorities are translated into measurable outcomes and tracked consistently across the organization.
Executive Position Replacement and Realignment
The proposed reorganization is implemented primarily through the replacement and reallocation of existing executive positions, rather than through net growth in executive headcount. The Senior Assistant City Manager is a new position that builds intellectual capacity in the City Manager’s Office. The Assistant City Manager - Fiscal Sustainability & Transparency replaces a currently vacant Assistant City Manager position using existing budgeted resources and oversees the Chief Financial Officer and City Clerk functions. The current Assistant City Manager position is enhanced to focus on Economic Development, Vitality & Equity, and the Human Resources Director is reclassified to Chief Human Resources Officer to reflect expanded enterprise-wide responsibilities.
In addition, a Senior Executive Assistant to the City Manager is established to strengthen executive coordination and City Council support, and the Assistant to the City Manager/Performance Management role is enhanced to support enterprise performance analytics, accountability, and results-based management. Collectively, these changes are intended to build leadership depth, improve succession readiness, and reinforce the City’s ability to attract, retain, and develop high-performing talent across the organization.
Performance Management and Pay-for-Performance
The reorganization incorporates a formal executive performance management and pay-for-performance framework consistent with International City/County Management Association (ICMA) best practices and modern talent development principles. Executives will operate under annual performance plans aligned with City Council priorities and strategic goals, supported by measurable, outcome-based objectives, mid-year and annual evaluations, and integration of performance results into compensation and advancement decisions.
As part of this framework, the City will incorporate 360-degree performance feedback for executives to capture leadership effectiveness, identify development opportunities, and support continuous growth. This approach strengthens accountability while reinforcing a culture of learning and improvement. Executives will also be accountable for applying Lean Six Sigma methodologies to improve cross-departmental collaboration, including creating operational synergy between Transportation Planning and the Public Works Mobility Engineering team to streamline workflows, reduce duplication, and optimize project delivery. Together, these tools support long-term cost savings, service efficiency, and a strong return on the City’s investment in its workforce.
FISCAL ANALYSIS
The proposed reorganization of the City Manager’s Office represents an investment in organizational capacity, leadership capability, and workforce acumen and results in a net increase of $962,500 in annual full costs, inclusive of salary and associated benefit costs. This impact reflects a combination of new executive positions, replacement and reclassification of existing positions, and equity-based adjustments to select department head and City Clerk classifications.
Primary cost drivers include the establishment of a Senior Assistant City Manager, a Senior Executive Assistant to the City Manager, and an Assistant to the City Manager for Performance Management, as well as the reclassification of the two existing Assistant City Manager roles and the Human Resources Director to Chief Human Resources Officer.
The projected increase represents full annual cost estimates, including benefits, and excludes only indirect overhead. Actual costs may vary based on final step placement and implementation timing. Collectively, these investments are intended to strengthen leadership effectiveness, improve talent attraction and retention, and enhance the City’s long-term organizational performance.
The Adopted Budget for Fiscal Year 2025-2026 can support these changes without additional appropriation due to salary savings from existing vacant positions and the time needed to recruit for new positions. The costs for Fiscal Year 2026-2027 will be included in the upcoming budget and will be balanced by reductions in other areas. Likewise, any costs for the performance management and the pay-for-performance framework will be included in next fiscal year’s budget.
ATTACHMENTS
1. 2026-01-26_ATT 1_Proposed Resolution Adopting Classification and Salary Plan for City Employees, effective January 26, 2026; and
2. 2026-01-26_ATT 2_Proposed Resolution Adopting Updated Executive Compensation Plan, effective January 26, 2026
recommended action
MOTION(S)
That the City Council:
1. Approve the City Organizational Reorganization; and
2. Adopt a Resolution adopting the Classification and Salary Plan for City Employees, effective January 26, 2026; and
3. Adopt a Resolution adopting the updated Executive Compensation Plan, effective January 26, 2026.
4. Approve the executive performance management and pay-for-performance framework; and
5. Authorize the City Manager to implement the approved changes.