AGENDA CAPTION:
Title
Consider approval of Resolution 2025-181R, approving a one-year extension of the city’s contract with the Hays Caldwell Economic Development Partnership (“HCEDP”) in the amount of $200,000.00, plus eligible expenses, for economic development services; authorizing the City Manager, or her designee, to execute such contract extension; and declaring an effective date.
Body
Meeting date: September 16, 2025
Department: City Manager’s Office
Amount & Source of Funding
Funds Required: $320,000
Account Number: 10001133-54195, 21006322-54195, 22006335-54195
Funds Available: Yes
Account Name: Economic Development
Fiscal Note:
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Background Information:
The current contract with the Hays Caldwell Economic Development Partnership (“HCEDP”) is a one-year contract extension of the original contract. The one-year extension ends September 30, 2025 (FY25). The request for another one-year extension will cover the period of October 1, 2025 through September 30, 2026 (FY26).
For the FY25 contract, the following changes were made:
- The annual contract was reduced from $400,000 to $320,000 to financially support moving the business retention and expansion (BRE) services from an HCEDP contract scope to BRE services which are directly provided by City staff.
- The $80,000 reduction in the contract was used to hire a full-time BRE position to take on the responsibilities.
For the FY26 contract, the following changes are proposed:
- Reduce the annual contract from $320,000 to $200,000 to financially support moving more services directly to City staff and taking direct responsibility for the economic development incentive application process and analysis.
- The $120,000 reduction in the contract will be used to (1) hire an analyst/specialist (yet to be titled) position to compute the benefits and costs of submitted incentive applications; and (2) increase the job scope and responsibilities of the vacant Economic and Business Development Manager position to Economic and Local Business Development Director. The increase in job scope and responsibilities also relates to a recent operational change as described below.
Recently, the Main Street Program was integrated into the Economic Development Program, consolidating small and local business services within a single program. This realignment will enhance collaboration between Main Street and the Economic Development team, particularly in supporting Downtown as a hub for business and community life. Main Street will continue to focus on maintaining the unique and historic nature of Downtown San Marcos and supporting Downtown as a destination for visitors and tourists. Reflecting this broadened scope, the ED Program has been retitled “Economic and Local Business Development” to highlight small and local business as a central focus.
Council Committee, Board/Commission Action:
In August 2025, the Economic Development San Marcos (EDSM) Board voted unanimously to recommend to city council a one-year contract extension with Hays Caldwell Economic Development Partnership (“HCEDP”) with the revised contract costs and scope of work.
Alternatives:
Council can vote to approve the contract, deny the contract extension, or postpone the item.
Recommendation:
Staff recommends approval of the contract as presented.