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HomeMy WebLinkAboutItem 4.03 DavidMGriffithStateMandate (2) CITY CLERK File # D~~[{1]-l3J[QL AGENDA STATEMENT CITY COUNCIL MEETING DATE: (July 1, 1997) SUBJECT: Agreement With David M. Griffith & Assoc., Ltd. (DMG) To Obtain State Mandated Cost Claiming Services ~prepared by: Paul S. Rankin, Assistant City Manager) EXHIBITS ATTACHED: Exhibit I: Excerpts From DMG Proposal Exhibit 2: Consultant Agreement with David M. Griffith & Associates, LTD. RECOMMENDA TIO,-=-, (1.-"--- \{'\Ff" FINANCIAL STATEMENT: Authorize the City Manager to execute agreement with David M. Griffith & Associates, LTD. The proposed Agreement is a contingent fee option, under which the consultant will bill the City for 30% of actual State payments received by the City as reimbursement for state mandated costs, not to exceed a total of$IO,OOO. DESCRIPTION: The City Council identified an investigation into receiving reimbursement for state mandated costs as a Medium Priority Goal for Fiscal Year 1997-98. Due to deadlines established by the State it is important for the City to consider these services at this time. Some of the potentIal reimbursable costs have claiming periods which will close in the month of July. If the City is unable to submit a fully documented claim by the deadline it will not be possi~le to recover state monies for that particular mandated cost. State Mandated Costs The State mandates under its Constitution that the cities perform various functions for the public, including providing absentee ballots, notices of open meetings, notification of stolen vehicles, and reporting to the State of all City businesses with business licenses. The State, as part of its budget, allows for reimbursement requests to be made by cities to recover the costs of performing these functions. Due to the complex data collection and reporting requirements required for these reimbursements, staff has elected to enlist the assistance of an outside firm in gathering the data and preparing the reimbursement claim. Solicitation of Proposals From Qualified Firms Staff contacted two firms who have extensive experience in providing state mandated cost claiming services to cities. Both of these firms, David M. Griffith & Associates LTD. (DMG), and David Wellhouse and Associates Inc., provided information about their services to staff and submitted proposals ------------------------coprnsTO:-v~IS~DMGI~~~~---~;, G/Agenda/mandcost.doc (>1 to provide these services for tJ ':ity. Although the approach may c '~r, both firms have excellent - references in this area and are fullY capable of assisting the City with preparing its mandated cost claims. City staff has evaluated both of the firms' proposals and has determined that the proposal provided by DMG best met the needs of the City of Dublin. The following factors were considered of importance in making this recommendation: the cost of providing the service was lower; the firm has a number of clients in the Bay Area, including the County of Alameda and the cities of Pleasanton and Danville; and the firm offered to perform the services under a contingent fee option. The contingent fee option ensures that the City will only incur costs based upon the actual amount of the reimbursement the City receives from the State. In addition the City will not be obligated to make any payments until funds are received from the State. Structure of Proposed Continz:ency Agreement The proposed contract cost is based upon a contingent fee option, under which the consultant will bill the City for 30% of actual State payments received by the City as reimbursement for state mandated costs, up to a maximum fee of $10,000. For example if the claims Which the City receives reimbursement for are $20,000, the Consultant fee would be $6,000 (.30*$20,000 "" $6,000). However, the amount of the Consultant fees would never exceed $10,000, under the terms of this Agreement. Since it is early in the Fiscal Year adequate funds are available in the Administrative Services Department Contract Services Account, to allow the City to enter into the Agreement. It is anticipated that Staff will include a budget change on a future City Council Agenda, once Staff has more precise information related to the amount claimed. The Budget Change will address both the cost of the Consultant Services as well as the additional revenue. As adopted, the Fiscal Year 1997-98 Budget did not account for either the revenue or Consultant expense. Scope of Work Sections lA, IB, and IC ofthe Agreement describe the potential areas for claims. Part of the Consultants work will be to assist Staff in determining whether the City has incurred costs which would be reimbursable under State guidelines. It should be noted that the State also has considered the cost of submitting the claim as a reimbursable cost. Therefore, the State should reimburse the costs associated with the services provided by DMG. The exact amount of claims is undetermined and it is DMG's experience that it will vary from city to city. It is expected that reimbursements will be primarily related to the following mandates: Open Meeting Act Notices; Business Tax Reporting Requirements; absentee ballots; and various law enforcement reporting and training requirements. The Consultant has suggested proceeding with the filing of "late" claims for expenses incurred in prior Fiscal Years. The State would only pay 90% of these "late" claims rather than the full cost. It would remain in the City's interest to file the late claims in order to receive partial reimbursement of the costs. DMG will compile all information needed for the claims including, collection of program and cost information from City Departments. DMG then prepares the claim, and informs City Staff of any potential issues related to the claim. After review by City Staff, DMG then sends the claim in the State's required format for reimbursement. Throughout the year, DMG will respond to any questions from the State Controller's Office and provide ongoing assistance to City staff in regards to state mandated costs. It is recommended that the City Council authorize the City Manager to execute an agreement with David M. Griffith & Associates L TD for state mandated cost claiming services. -.;<- EXHIBIT 1 EXCERPT FROM PROPOSAL FOR STATE MANDATED COST CLAIMING SERVICES SUBMITTED BY DAVID M. GRIFFITH & ASSOCIATES, LTD. I n F:I J.<:t [i (::1 r:I '<"~I '''' '" ",':, " .:~ ~" 1;'-', "., ~ iiI! JI '-'1 1 ,:" ,,,' ;" , , , , J OJ , " '.Ii -- DAVID M. GRIFFITH & ASSOCIATES, LTD. Professional Services for the Public Sector 4320 Auburn Boulevard, Suite 2000 Sacramento, California 9S841 916.48S.8102 Fax: 916.48S.0111 DMG January 28, 1997 Mr. Fred Marsh Finance Director City of Dublin 100 Civic Plaza Dublin, CA 94568 Dear Mr. Marsh: David M. Griffith & Associates, Ltd. (DMG) is pleased to submit this proposal to provide comprehensive state mandate cost claiming services to the City of Dublin. DMG will provide the City with a full range of services to prepare and file all eligible claims. This service should result in greater levels of reimbursement, enhance the ability of your jurisdiction to monitor the mandated reimbursement process, and increase audit protection. This proposal describes the various claiming opportunities, scope of services, DMG's approach to maximizing your cost recovery, the advantages of having DMG complete your claims, and the costs , for providing these comprehensive state mandated cost claiming services. It is organized as follows: :> :> Claiming Opportunities and Scope of Services Our Approach to Claiming Your Mandated Cost Programs Firm Qualifications and Advantages of DMG's Services Costs and Method of Payments f" ~ ~ We have also enclosed a copy of DMG's California Cities SB 90 Service newsletter. A complimentary copy of this newsletter, which will help you stay on top of all key mandated cost issues, will be sent to you during the term of our agreement. There are several reasons for the City of Dublin to join the over 160 cities and 30 counties that rely on DMG to file their state mandated cost claims. They include: Acknowledged Expert in tlte Area of State Mandated Cost Claiming - DMG has served California local government in the State Mandated Cost area for over 15 years. We are endorsed by both the League of California Cities and California State Association of Counties in the state mandated cost area. :z. ~',:, 'J ~,.;,I ~ >~ ~:I' \'", fl:" ft",,, t ~~ ~f ,,\ , :~'\~~ I',', f;'~ , Gi J:! ~-" Ii' -' ~ ~.! ~ fl ,i'J ~~\ . ..~ ~" [I,,' 'I" ~;" !} Ji :!! ~" <f:' ":".", ,..,. I~?; ," Increased Revenue to tlte City - DMG's State Mandated cost knowledge coupled with our expertise in preparing separate OMB A-87 departmental indirect cost rate proposals for each mandated program, result in increased reimbursement to the City. Unparalleled Cost Accounting Expertise - DMG is the nation's leading expert in public sector cost accounting and the OMB A-87 reporting areas. It is now more important than ever to have your claims prepared by a firm that can provide maximum surety that acceptable cost accounting practices are met. We welcome the opportunity to work with you and your staff in the City's mandated cost claiming program. If you have any questions concerning this proposal or would like to meet with DMG staff to discuss it in more detail, please do not hesitate to give me a call. You can reach me in our Sacramento office at (916) 485-8102 or Virgil Salzman in our Cupertino office at (408) 366-0260. Sincerely, Allan P. Burdick Vice President \ 1j 1996-97 Annual & Late State Mandated Cost Reimbursement Claims Absentee Ballots ,f Elections costs associated with the absentee ballots mandated requirements. Business Tax Reporting Requirements ,f Tracking & transmitting FTB-required data for all new and renewal city businesses. Firefighters' Cancer Presumption ,f Workers compensation, disability and legal costs in cases of presumptive firefighter cancer cases. Open Meetings Act Notices ,f Agenda preparation, review & posting costs required by the Ralph M. Brown Act. Mandate Reimbursement Process ,f Costs of participating in the SB 90 process: DMG's fees, staff time, and time & payment tracking costs. Peace Officers' Cancer Presumption " Workers compensation, disability and legal costs in cases of presumptive police cancer cases. Brendon McGuire Act " Elections costs incurred by an agency in the event that an elected candidate dies before taking office. Stolen Vehicle Notification " Cost associated with notifying reporting party of the recovery of a stolen vehicle. R V. t. C I. get N t" ,f Cost of providing a rape victim with infor- ape Ie 1m ounse In en er 0 Ices \ . d' d tt" th . matlon regar mg, an pu mg em m contact with rape victim counseling centers. Law Enforcement AIDS Testing ,f Providing training and HIV testing of law enforcement officers. Misdemeanors: Booking and Fingerprinting ,f Cost of providing the misdemeanant with a record or verification of the booking or fingerprinting. '1 OUR APPROACH TO CLAIMING - TAILORED To FIT YOUR CITY'S SITUATION This section describes the general approach for meeting the various claiming deadlines and requirements for the state mandated cost claiming process. We will tailor our approach to fit your City's specific situation. To make sure there is a complete understanding between all parties, DMG has developed the following approach which should result in the highest supportable reimbursement possible. The following steps will be taken by DMG to complete each claiming cycle: > Complete Planning & Scheduling - For each claiming cycle, DMG will work with the City to develop separate plans and schedules for completing claims. The plan will also identify the roles and responsibilities of all persons involved with the process and the tasks to be completed. Specifically, these activities include: · DMG consultants will contact the City's SB 90 Coordinator to discuss the approach and tentative schedule for work completion. DMG will also work with the SB 90 Coordinator to identify the primary contact in each applicable department. · DMG will contact each departmental liaison and provide them with infor- mation on the specific mandate reimbursement needs required to file claims applicable to their department. > Data Collection from Departments - DMG will collect mandated program information from all affected departments, as well as, identify administrative and support personnel who should be included in the department's indirect cost rate proposal (ICRP). DMG will review the information and help department personnel understand what tasks are specifically reimbursable through SB 90. > Collect Departmental Expenditure Data & Compensation Information - A key step in the data collection process is to obtain all required fmancial data from the City's Finance Department. DMG will gather salary and benefit information, annual department expenditure reports, and OMB A-87 cost allocation schedules. > Prepare & File" Claims - As the claims are prepared, DMG will inform the SB 90 Coordinator if there are any problems and assist in resolving those problems. After completion of the claims, DMG will send the claims to the City for review and signature. Finally, DMG will deliver the signed claims to the State Controller by the deadline. > Organize Work Papers & On-Going Support - After the claims are filed with the State, DMG will send the City a receipt listing all claims that were filed, and the amounts claimed. This claims receipt will be signed by a representative from the State Controller's Office signifYing timely claims submission. We will also respond to requests from the Controller's staff and provide on-going assistance throughout the year. 5 !~I !:" ~:\'1 I P ~I q,." ~: ,-.},,\\ B ~~~ . ~:~I WI III ~ fI ~'" \')1, :;~ ' ~ w~ [if i. fI" ,. " , fil ~5 "" " , ~"" ." ,I of"~ 1i ~! ,., " ;:. DAVID M. GRIFFITH & ASSOCIATES: Firm Back!!round & Experience David M. Griffith & Associates, Ltd. (DMG) is California's leading firm dedicated to providing the public sector with creative revenue enhancement alternatives. Calculating the full costs of government services is the cornerstone to maximizing our clients' revenues. We believe that our expertise will enable your agency to maximize State mandated claims reimbursement with as little effort or disruption to your operation as possible. Since it's establishment, DMG's California practice has served over 225 California cities and all 58 counties. DMG has offices in Sacramento, Cupertino and Pasadena to serve cities throughout California. ADVANTAGES OF DMG's SO 90 SERVICE [2J Knowledge & Experience DMG has specialized in the state mandated cost area for over 15 years. We currently prepare SB 90 claims for approximately 160 cities and 30 counties in California. DMG's advice and assistance is often sought by the State Department of Finance, the Controller's Office, the Commission on State Mandates, and State legislative committees. I2l Expert Staff Our firm has a full-time staff dedicated solely to the research and preparation of SB 90 mandates to identify the exact components which are eligible for reimbursement. We work closely with the State Controller's staff and are often involved in the development and editing of claiming instructions. This access and involvement provides our consultants with invaluable insight, which is essential to high quality claim preparation. bZI Service We feel that our high level of customer service and attention to detail has lead to our success. Almost all of our State mandated service clients are long~term, repeat clients. Our service doesn't end with the submission of your claims. Responding to State Controller's audits, challenging reductions to your claims, and assisting you in state mandated revenue tracking are examples of our on-going service. bZI Increased Recovery For Your Agency Our expertise translates directly into higher reimbursements for our clients. Not only are you assured that eligible direct costs will be captured, but our cost accoWlting emphasis enables us to include all items which are recognized as eligible by OMB A-87 while calculating departmental indirect cost rates. bZl Reputation For Quality t, DMG takes pride in our reputation for technical accuracy -- a critical consideration given the increasing scrutiny imposed by State auditors on cost accounting applications. We are endorsed exclusively by both the League of California Cities and the California State Association of Counties in the state mandated cost area. COSTS AND METHOD OF PAYMENT In this proposal, we have separated the cost of our claiming services by fiscal year. We have also provided a fixed fee and a contingent fee option for the City to select from. Each is described below. Services To Be Provided 1996-97 Services - includes all AB 818 law enforcement claims; any Fall 1996 claims that may still be eligible to file, and the SB 91 law enforcement claims. If the City does not have any AB 818 claims, the price would be reduced accordingly. 1997-98 Services - includes all Fall 1997 annual claims and claims due based on all other claiming instructions issued in the 1997-98 fiscal year. Fee Options Fixed Fee Option - the fixed fee option includes all fees and expenses. The 1996-97 fixed fee would be due on June 30, 1997. For our 1997-98 services, 50% of the fixed fee would be due following the Annual claiming cycle on November 30, 1997 and the other half would be due on June 30, 1998. Contingent Fee Option - under the contingent fee option, DMG will bill the city for 30% of actual State payments to the City up to a maximum amount or cap. The contingent fee cap is slightly higher than the fixed fee amount, due to delay in receiving payment. Proposed Costs The costs for completing the work described in this proposal are: Claimin1l Services Fixed Fee Contin1lent Fee 1996-97 Claiming Services $ 5,000* $ 5,500 1997-98 Claiming Services $ 4,750 $ 5,250 $10,000 Both Fiscal Y ears/All Claims $ 9,000 "'Assumes the City will have at least two of the AB 818 claiming programs (each program consists of several fiscal year claims). If the City would prefer some other pricing alternative, we would be pleased to discuss other arrangements. New Rules on Payment to Contractors The State has adopted new guidelines regarding the reimbursement of contractor's fees. If the City is to retain full reimbursement of our fees, the City will need to certify that they could not have prepared the claims in-house for less than DMG's fee. '1 Contract Number: F97.239 Agreement to Provide Mandated Cost Claiming Services THIS AGREEMENT, entered into this 1ST day of JULY , 1997 and effective immediately by and between David M. Griffith & Associates, Ltd. (hereinafter "Consultant") and the City of Dublin (hereinafter "City"), WHEREAS, Article XIIIB of the California State Constitution provides that cities may recover costs associated with carrying out programs mandated by the State of California, WHEREAS, the City desires to obtain maximum reimbursement for costs incurred in carrying out State mandated programs, and has determined that engaging the Consultant to assist in the mandated cost claim preparation process is the most economical and cost effective means for preparing the City's state mandated cost claims; and WHEREAS, the Consultant is staffed with personnel knowledgeable and experienced in determining the costs of governmental programs and in the submission of cost claims to the State of California, and WHEREAS, the City desires to engage the Consultant to assist in developing, submitting, and negotiating cost claims pertaining to state mandated programs. NOW, THEREFORE, the parties hereto mutually agree as follows: 1. Scope of Services The Consultant shall prepare claims for reimbursable state mandated costs as provided herein. A. Annual (Actual'and Late) State Mandated Cost Reimbursement Claims. The Consultant shall prepare and file all applicable actual annual state mandated cost reimbursement claims for the 1995-96 and 1996-97 fiscal year. The Consultant shall also file estimated claims for fiscal year 1997-98. The fiscal year 1996-97 actual and 1997-98 estimated claims must be submitted to the StateeNovember 30, 1997 to be considered a timely filing and to avoid late penalties. , The fiscal year 1995-96 claims were due to the State Controller's Office November 30, 1996 and as such are subject to a per claim late penalty equaling 10% of the amount claimed or $1,000, whichever is less. All amended or late claims filed by the consultant for this fiscal year shall be subject to these penalties. The Annual State Mandate cost claims include the following: City of Dublin g - 1 - E]@lIBfT 2 Contract Number: F97-239 (I) Open Meetings Act requirement as specified in Chapter 641, Statutes of 1986. (2) Business License Tax Reporting Requirements as specified in Chapter 1490, Statutes of 1984. (3) Absentee Ballots as specified in Chapter 77, Statutes of 1978. (4) Mandate Reimbursement Process as specified in Chapter 486, Statutes of 1975 and Chapter 1489, Statutes of 1984. (5) Firefighter Cancer Presumption as specified in Chapter 1568, Statutes of 1982. (6) Peace Officer Cancer Presumption as specified in Chapter 1171, Statutes of 1989. (7) Stolen Vehicle Notification as specified in Chapter 337, Statutes of 1990. (8) Misdemeanors: Booking and Fingerprinting as specified in Chapter 1105, Statutes of 1992. (9) Law Enforcement AIDS Testing as specified in Chapter 768, Statutes of 1991. (10) Rape Victim Counseling Center Notices as specified in Chapter 999, Statutes of 1991. The Consultant may also file additional fiscal year 1995-96 and 1996-97 actual claims if any such eligible claims remain. B. New Claims Authorized by Assembly Bill 818 of 1995 - Late Law Enforcement Claims The Consultant shall prepare and file all applicable actual AB 818 state mandated cost reimbursement claims. These back year claims were due to the State Controller's Office August 19, 1996 and as such are subject to a per claim late penalty equaling 10% of the amount claimed or $1,000, whichever is less. Eligible cost claims include: (1) Stolen Vehicle Notification as specified in Chapter 337, Statutes of 1990. Annual actual cost claims for fiscal years 1990-91 through 1994-95. (2) Misdemeanors: Booking and Fingerprinting as specified in Chapter 1105, Statutes of 1992. Annual actual cost claims for fiscal years 1992-93 through 1994. (3) Law Enforcement AIDS Testing as specified in Chapter 768, Statutes of 1991. Annual actual cost claims for fiscal years 1988-89 through 1994-95. (4) Rape Victim Counseling Center Notices as specified in Chapter 999, Statutes of 1991. Annual actual cost claims for fiscal year 1991-92 through 1994-95. City of Dublin "J - 2 - June 19, 1997 Contract Number: F97~239 C. New Mandates Funded in the 1996 Legislative Sessions - Fiscal Year 1994-95 Missing Persons III Claim The Consultant shall file the fiscal year 1994-95 Missing Persons III claim due to the State Controller's Office July 28, 1997 if the City can provide necessary data to the consultant by July 16, 1997. If the claim is filed after that date, it is subject to a penalty equaling 10% of the amount claimed or $1,000, whichever is less. 2. Consultant Claim Filinl! Reauirements The Consultant shall file these claims to the extent that appropriate documentation is available and verifiable. The City explicitly acknowledges that the Consultant does not warrant under Scope of Services that claims will be filed for all of the applicable mandates listed. . 3. Costs and Method of Compensation Scope of Services 1.A., 1.B., and 1.e. - Annual, AB 818, and Missing Persons III State Mandated Cost Reimbursement Claims For the services provided pursuant to Scope of Services LA, 1.8., and 1.C the City agrees to pay the Consultant a contingent fee of thirty percent (30%) of the amount claimed and paid, to a maximum of ten thousand dollars ($10,000). Payment shall be made from monies actually received from the State resulting from the Consultant's efforts. Monies received shall be defined as payments resulting from the Consultant's filing of cost claims listed in Scope of Services LA., LB. and 1.C.. The fee, which in no case shall exceed the maximum amount, is due within four weeks of City receipt of reimbursement from the State. 4. Services and Materials to be Furnished bv the City The Consultant shall provide guidance to the City in determining the data required for claims submission. The Consultant shall assume all data so provided to be correct. The City further agrees to provide all specifically requested data, documentation and information to the Consultant in a timely manner. Consultant shall make its best effort to file claims in a timely manner pursuant to Scope of Services. Consultant shall not be liable for claims that cannot be filed as a result of inadequate data or data provided in an untimely manner. For purposes of this Agreement, data that is requested by the Consultant must be provided within three weeks of the request, or three weeks prior to the filing deadline, whichever would come first, to be deemed to have been received in a timely manner. It is the responsibility of the City to provide the Consultant with payment information upon City of Dublin 10 - 3 - June 19, 1997 Contract Number: F97-239 receipt of disbursements from the State for any and all claims filed pursuant to this agreement. 5. Not Oblie:ated to Third Parties The City shall not be obligated or liable hereunder to any party other than the Consultant. 6. Consultant Liability if Audited The Consultant will assume all financial and statistical information provided to the Consultant by City employees or representatives is accurate and complete. Any subsequent disallowance of funds paid to the City under the claims for whatever reason is the sole responsibility of the City. 7. Indirect Costs The cost claims to be submitted by the Consultant may consist of both direct and indirect costs. The Consultant may either utilize the ten percent (10%) indirect cost rate allowed by the State Controller or calculate a higher rate if City records support such a calculation. The Consultant by this Agreement is not required to prepare a central service cost allocation plan or departmental indirect cost rate proposals for the City. 8. Consultant Assistance if Audited If audited, the Consultant shall make workpapers and other records available to the State auditors. If requeste4, by the City, the Consultant shall provide assistance to the City in defending claims submitted if an audit results in a disallowance of at least twenty percent (20%) or seven hundred fifty dollars ($750), whichever is greater. Reductions of less than twenty percent (20%) or seven hundred fifty dollars ($750) shall not be contested by the Consultant. 9. Insurance Consultant shall acquire and maintain appropriate general liability insurance, workers' compensation insurance, automobile insurance, and professional liability insurance. 10. Chane:es The City may, from time to time, require changes in the scope of services of the Consultant to be performed hereunder. Such changes, which are mutually agreed upon by and between the City and the Consultant, shall be incorporated in written amendment to this agreement. City of Dublin II - 4 - June 19, 1997 Contract Nwnber: F97-239 11. Termination of Aereement If, through any cause, the Consultant shall fail to fulfill in a timely and proper manner its obligation under this agreement, the City shall thereupon have the right to terminate this agreement by giving written notice to the Consultant of such termination and specifying the effective date thereof, at least five (5) days before the effective date of such termination. 12. City Contact Person The City designates the following individual as contact person for this contract: Name: FRED MARSH Telephone: (510) 833-6640 Title: FINANCE MANAGER Fax: (510) 833-6651 Address: 100 CIVIC PLAZA (POST OFFICE BOX 2340) DUBLIN, CA 94568 13. Executed Contract To be valid this contract must be signed by the City by July 2, 1997. If signed after that date the Consultant cannot guarantee acceptance of the Agreement unless otherwise agreed upon. If the City requests that DMG prepare the claim(s), and DMG prepares and submits the claim(s) without the City having executed and forwarded a copy of this contract to the Consultant prior to the due date of the reimbursement claim, a signature by a City employee on the claim(s) coversheet(s) indicates the City's acceptance of this contract and its terms. OFFER IS M~ OFFER IS ACCEPTED BY CITY BS- , __By: Allan P. Burdick, Vice President City OfficialRICHARD C. AMBROSE David M. Griffith & Associates, Ltd. CITY MANAGER Date: June 19. 1997 Date: City of Dublin /).. ~ 5 M June 19, 1997