PREPARED BY: MATT RODRIGUEZ DATE OF MEETING: 07/06/2026
SUBJECT:
TITLE
CONSIDER RATIFYING A LETTER OF SUPPORT FROM SAN PABLO MAYOR PABON-ALVARADO/CITY COUNCIL AND THE NATIONAL ZIP CODE ADVOCACY COALITION FOR FEDERAL LEGISLATION S. 4505 - ZIP CODE GEOGRAPHIC INTEGRITY ACT TO CHANGE THE ZIP CODE FOR THE CITY OF SAN PABLO INCORPORATED MUNICIPAL LIMITS
CEQA: This proposed action is not a project as defined by CEQA.
Label
CITY MANAGER RECOMMENDATION
Recommendation
Authorize by Minute Order
Body
Compliance statements
FY 2025-27 Council Priority Workplan Compliance Statement
Major Policy Area: Focus On Economic Development and Fiscal Diversification is a major policy area contained in the adopted FY 2025-27 City Council Priority Workplan, effective April 7, 2025.
CEQA Compliance Statement
This proposed action is not a project as defined by CEQA as a budget or financing mechanism pursuant to 14 Cal. Code of Regulations section 15378(b).
BACKGROUND
For the past two years, San Pablo has monitored the progress of S.4505 legislation, the Zip Code Geographic Integrity Act, which aims to change the city's current zip code, 94806, to support local economic development and identity. This federal bill covers 70 communities and consolidates related legislation seeking approval for zip code changes.
The City's zip code, 94806, is shared with surrounding jurisdictions:
• Portions of City Incorporated Limits of Pinole, CA; and
• Portions of City Incorporated Limits of Richmond, CA; and
• County Unincorporated areas of: Montalvan Manor, North Richmond, Rollingwood, and Tara Hills
See current zip code map of 94806:
<https://www.unitedstateszipcodes.org/94806/>
Current Business License and Sales Tax Audits
Recent audits of business licenses and sales tax reporting, conducted by the City's contracted consultants, have revealed that several businesses physically located within San Pablo City limits operate under Richmond or El Sobrante mailing addresses assigned by their local post offices. Because these businesses are not consistently associated with San Pablo at the address level, the City's ability to accurately administer City business licensing and reconcile annual sales tax reporting is compromised, and a portion of revenue properly attributable to San Pablo may become misallocated to surrounding jurisdictions. This concern has become more pronounced following the City's recent permitting of licensed cannabis retail establishments operating within City limits, where precise revenue attribution is essential to the City’s General Fund.
Bradley-Burns Sales Tax Reform in California
Over the past year, a state-wide City Manager Working Group sought to reform Bradley-Burns local sales tax apportionment by implementing a 50/50 split of revenues from state-wide e-commerce sales. At its February 19-20, 2026 meeting, the League of California Cities Board rejected all but one of its Revenue & Taxation Committee's related recommendations by a 55-2 vote, citing concerns that the proposals were too divisive and that many cities depend heavily on this revenue for general fund operations and service delivery.
Instead, the Board directed League staff to pursue a narrower statutory change: reallocating county pool use tax dollars from out-of-state e-commerce transactions-revenue established under AB 147 (2019) following South Dakota v. Wayfair-from broader county pools directly to destination cities. This would better reflect where goods are actually delivered and consumed, and the Board viewed it as a more balanced and less disruptive alternative to the 50/50 split. League staff was directed to work with the California Department of Tax & Fee Administration (CDTFA) to design the reallocation mechanism, and staff will update the Council as it develops and is implemented.
Nonetheless, continued efforts to revise the State's apportionment formula for jurisdictions hosting major fulfillment and distribution centers, such as those in Richmond and comparable facilities state-wide, could reduce local sales tax revenue for cities whose zip codes encompass those facilities if enacted by State law. For San Pablo, the combination of ambiguous address attribution and a shifting State apportionment framework heightens the risk to the City's fiscal revenue capacity and could constrain its long-term economic development strategy.
Support for Federal Legislation (S. 4505)
To address these risks, the City's legislative advocate, TPA, is actively engaging Senator Alex Padilla's (D-CA) office who is a co-sponsor of the S. 4505 legislation, to include a zip code change for San Pablo in coordination with the National Zip Code Advocacy Coalition (Coalition). The Coalition represents communities across the country that are pursuing dedicated zip codes through the United States Postal Service. A unique zip code that aligns with San Pablo's incorporated City boundaries would allow the City to attribute business activity and sales tax revenue accurately, reduce reliance on neighboring jurisdictions' postal designations, and reinforce the City's distinct economic and civic identity. For these reasons, staff recommends that the Council affirm its support for S. 4505
City Manager Recommendation
This evening, the City Manager is seeking formal ratification and approval, by majority vote via minute order, of the attached letter transmitted from San Pablo Mayor Pabon-Alvarado on June 29, 2026, representing the San Pablo City Council. The letter expresses support for S.4505 legislation and the Coalition’s active advocacy and efforts in supporting those cities requesting zip code changes identified in the federal bill under consideration.
FISCAL IMPACT:
No fiscal impact associated with this agenda item.
ATTACHMENTS
Att A. Letter transmitted on June 29, 2026 from San Pablo Mayor Elizabeth Pabon-Alvarado re: SUPPORT FOR S. 4505 - ZIP CODE GEOGRAPHIC INTEGRITY ACT