HomeMy WebLinkAboutItem 4.11 - 1226 Management Partners Report
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STAFF REPORT
CITY COUNCIL
DATE: November 15, 2016
TO: Honorable Mayor and City Councilmembers
FROM:
Christopher L. Foss, City Manager
SUBJECT:
Update on Efforts to Improve Professional Services Contracting Practices
Prepared by: Linda Smith, Assistant City Manager
EXECUTIVE SUMMARY:
The City Council will receive an informational report on Staff’s efforts to improve the
City’s contracting practices for professional services. Earlier this year, the City Manager
issued six Administrative Actions aimed at increasing contracting transparency. The
City Manager also requested an independent review of the Administrative Actions to
determine if they are sufficient or if additional steps should be taken to meet with best
practices of other municipal organizations that rely heavily on contracting services for
their ongoing operations.
STAFF RECOMMENDATION:
Receive the report.
FINANCIAL IMPACT:
None.
DESCRIPTION:
Background
In February 2016, the City Manager issued six Administrative Action s (Attachment 1) to
improve the City’s contracting practices for professional services. At that same time,
the City Manager directed the Assistant City Manager to engage with an outside firm to
evaluate whether the six actions were sufficient or if additi onal steps should be taken to
ensure that Dublin was adhering to the best practices of other cities that rely heavily on
professional services. The City engaged Management Partners, a firm that specializes
in assisting municipalities with operational and process improvements, to evaluate the
actions. Management Partners provided a scope of services, which is included as an
exhibit to the attached report. The engagement began in March 2016.
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Management Partners Review
Since March, Staff has been working with Management Partners to provide the
necessary documentation, interviews and input to assist in their review. This review and
the City Manager’s Administrative Action were in response to public concerns raised
related to the billings of a specific consultant providing staff augmentation services. The
concerns ranged from the number of hours worked weekly and aberrations in daily
billings to the span of control for this service provider. In each instance, Management
Partners reviewed the area of concern.
Management Partners concluded that the number of work hours billed during a billing
period was consistent with the work assigned to that service provider. They also
concluded, via interviews with City staff and the service provider, that the aberra tion in
daily billings was likely as a result a lack of emphasis on reporting total activity by day
as the City's emphasis was on bi-weekly project-based billing. Since the City evaluated
work based on the project where services were provided on a bi -weekly basis, it would
have been extremely difficult for Staff to appropriate hours to each day. Even prior to
the City Manager’s formal Administrative Action, Staff implemented the change to also
require daily billings for that service provider as an additio nal way to ensure
transparency.
The Management Partners report contains some key observations related to the City’s
contracting practices for professional services, offers additional recommendations to
improve the City’s current contract administration practices, as well as lists some best
practices that all municipalities should institute and many of which the City of Dublin
already does.
In summary, Management Partners acknowledged that the steps taken by the City
Manager were appropriate and made the following top line (both positive and negative)
observations.
· The use of consulting services for staff augmentation has met the City’s goal of
remaining flexible with market demand
· Appropriate internal controls were in place to review billings from c onsultants
· Appropriate supervision/direction was provided to its consultant(s) providing staff
augmentation services
· The City does not have formal policies, procedures and guidelines that can assist
with proper oversight of a decentralized contracting process.
· The standard language in the City’s consulting services agreement can be
inconsistent with certain types of service providers, such as those firms providing
staff augmentation services.
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· The City’s practice of project-based reporting/billing for its professional service
consultants (prior to the City Manager’s Administrative Action) did not allow for
an efficient or effective review of daily work.
Following the above top line observations and others included in this summary,
Management Partners provided the City with eight recommendations to strengthen the
process. Prior to the finalization of the report, Staff began implementing some of the
recommendations. Following is a list of the eight recommendations and the City’s
actions (in italics) to date to implement them.
Recommendations from Management Partners Report
1. Amend the City’s Purchasing Procedures Manual and/or the City Municipal Code
to incorporate contract administration procedures.
Staff has convened an internal working group, meeting with key departmental
staff to discuss the inclusion of contract administration procedures. Staff agrees
that formal guidelines for both contract administration and purchasing are
required. Separate from this engagement, Staff engaged Ma nagement Partners
to assist the City in carrying out this recommendation. It is anticipated that these
formal guidelines and procedures will be in effect by the end of the calendar year.
2. Amend the City’s standard consultant services agreements for a s-needed staff
augmentation services.
Key departmental staff, along with the Assistant City Attorney, has worked on an
update the City’s agreement form in order to account for the various types of
professional consulting services retained by the City. This new agreement form
has been implemented.
3. Inform all consultants in writing of the City’s new invoicing requirements and
request their immediate adoption.
Staff has notified all of our consultants individually and many of their agreements
have been updated with the new Fiscal Year agreements.
4. Adopt a policy requiring consultant services agreements to include a reasonable
term limit based on an evaluation of service needs.
With the new contract services for this Fiscal Year, Staff has included te rm limits
on these new contracts, ranging from two to three years.
5. Conduct a review of current Purchasing Agent authorization limits for approving
as-needed services agreements for staff augmentation services.
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The City Council did discuss purchasing agent authorization in the last year and
determined that they were not interested in adjusting the authority.
6. Develop a work plan identifying project specific assignments and performance
expectations before entering into a consultant service agreement for as-needed staff
augmentation work.
This recommendation pertains to on-site planning staff augmentation work, and
the City is currently utilizing augmentation services for field inspections and
project-specific planning. However, should on-site staff augmentation services
become necessary again, Staff would require a work plan from the consultant to
determine the amount of time necessary to provide services for each project.
7. Establish a policy detailing requirements and testing procedures for dete rmining
in independent contractor status, particularly for those consultants performing as -
needed staff augmentation work.
Human Resources staff is keenly aware of the IRS and CalPERS requirements
to maintain independent contractor status and they do cond uct regular checks
based on the hours worked by contractors.
8. Require issuance of a purchase order annually for all consultant service
contracts with an amount equal to the maximum value of the service contract.
While all project based work also has a purchase order, staff augmentation
services traditionally have not. For any new staff augmentation agreements,
Staff will establish a not-to-exceed amount in the contract and issue a purchase
order for that amount.
Staff believes that the work and resp onse to the report to date is evidence of the City’s
commitment to improve its processes and its transparency related to the provision of
consulting services in the operation of the City.
NOTICING REQUIREMENTS/PUBLIC OUTREACH:
None.
ATTACHMENTS:
1. City Manager's Administrative Actions
2. Management Partners Report
CITY MANAGER’S STATEMENT ON CONTRACT SERVICES
IN THE CITY OF DUBLIN
Contract services have been the cornerstone of the City of Dublin’s operations since its incorporation in 1982. It has allowed
the City to efficiently and cost-effectively staff its operations over the past 34 years to help meet the needs of the community.
The City’s current financial position bears this out.
The City has, at last count, dozens of contracts totaling over $34 million in FY 15-16. In addition to the large contracts with the
Alameda County Sheriff’s Office, Alameda County Fire Department and MCE (parks, facilities and street maintenance services),
the City maintains dozens of contracts ranging from janitorial to plan check services. The City also works with several firms
that provide on-call services to augment staff in land development.
On-call contract services are and will remain strategically important in the delivery of services in the City. Recently, one of the
City’s long-term, on-call consulting firms received media and community attention regarding its daily and annual hours
billed. It should be noted that consultant work performed was at the direction of the City and that I believe the hours billed
are reasonable given the work that the City has asked of this consulting firm over the last several years. I also believe that the
City received good value for what it has paid to the consulting firm. However, I am concerned about some of the billing
practices that led to the media attention, and I have conducted a thorough review of the City’s contracting processes. From
that review, I have advised the City Council of six changes to our current practices that I will be instituting:
1. On-call City consulting firms will now be required to provide two measures of hourly billing. They will be required to
submit daily logs of total hours worked by each individual performing service under the consultant contract, and they
will also be required to log hours by City project assignment. This change will provide the necessary cross-check for
staff to ensure hours will not be aggregated on a single day for work conducted over multiple days.
2. All on-call consulting firms that serve as staff augmentation for development services will be deemed to be
“consultants” under the Political Reform Act and required to file Form 700s. In addition, I have directed the City
Attorney's Office to review all of the City’s consulting contracts to determine whether any additional individuals
would be considered “consultants” under the Political Reform Act and required to file Form 700s.
3. Contractors working for an on-call consulting firm shall work no more than 2,000 hours in a fiscal year. In certain
circumstances, I would approve a small variance if a project and/or service demands necessitate it.
4. Currently, contract consultant service agreements don’t address the increments of time in which the firm’s time is
billed; the practices among consulting firms have varied. Moving forward, the City shall require consulting firms to bill
in either tenths of hours or quarter hours.
5. All Requests for Proposals for contract consulting services will include a section that will identify what public and
private clients the consultant is serving at that time (and in what communities they are doing that work). City Staff
shall include that list as an attachment to any contract consultant services agreement when it is considered by the
City Council.
6. While the City retains the right to terminate any on-call consultant agreement, the contracts do not currently include
a provision for a “date certain” termination of the agreement. Moving forward, all new contracts with the City of
Dublin shall include this provision.
It is my belief these changes will help to further strengthen the City’s solid reputation for strong fiscal management and will
address the concerns raised by members of the public and the media. In addition to these administrative changes, upcoming
Council meetings will include discussions on Consultant and Professional Services contracts and the City’s Conflict of Interest
Ordinance.
For questions or more information, please email city.manager@dublin.ca.gov.
1730 MADISON ROAD •CINCINNATI,OH 45206 •513 861 5400 •FAX 513 861 3480 MANAGEMENTPARTNERS.COM
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To:Ms. Linda Smith, Assistant City Manager, City of Dublin
From:Steve Bocian,Special Advisor, Management Partners
Subject:Review of the City of Dublin’s Contract Administration Policies, Practices,
and Procedures for Consultant Services
Date:November 7,2016
This memorandum provides the results of Management Partners’review of the City of Dublin’s
current policies, practices, and procedures related to contract administration for consultant services.
This engagement was prompted by the City’s concern with certain billing irregularities related to
its service agreement with Stevenson, Porto & Pierce, Inc. (SP2) that led the city manager to prepare
an Administrative Action on February 16, 2016 pertaining to the administration of private
consultant contract service agreements and procedures.
The goal of our work was to provide observations and recommendations about the Administrative
Action and existing contract administration policies to ensure the City is administering its
consultant service agreements consistent with best practices.The scope included the following:
Review existing service contracts to determine their overall effectiveness in addressing the
City’s needs as well as compliance with internal procedures;
Review the City-prepared draft amended contract administration procedures;
Interview the City’s community development and administrative services directors to
determine their specific needs and expectations from service contract providers;
Review the City’s policies for awarding and administering service contracts, including
contract extensions and amendments;
Conduct research into best practices for service contracting, including standards for billing
submittals and review; and
Review current billing and accounts payable procedures related to payments for service
contracts.
In addition, based on City staff’s concern with consultant invoicing practices, we reviewed Sections
1, 2, 3, 8, and 9 of SP2’s current services agreement dated May 15, 2012 as well as a number of
invoices and services SP2 provides. This provided insight into specific SP2 actions, SP2 submittals,
and the City’s current contract administration practices for all service agreements.
The SP2 services agreement provided a good basis for also evaluating other City service contracts
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and invoices.Management Partners’observations related to SP2, City invoicing practices, and
existing service contract language,were developed from reviewing this material.
The detail of our work is described more fully in our March 2, 2016 engagement letter, which is
included as Attachment A.
Background
The City of Dublin maintains an administrative and service delivery model that relies heavily on
contract services for a broad range of municipal services. For example, police and fire services are
provided using service contracts with outside agencies. In addition, the City uses a wide range of
contracted specialized professional services with private firms to provide assistance . These are
generally categorized as follows:
1.Project-specific contract services such as preparation of an environmental impact report,
implementation of information services, financial audits, etc.
2.General contract services that cover a wide range of services and activities for clearly
defined scopes of work such as analysis of City fees, janitorial services, plan checking,
building inspection, etc.
3.Consultant services that augment City staff work, generally on an on-call/as-needed basis.
The utilization of consulting services, to meet Community Development Department needs (as
identified in item 3 above),has allowed the City to be nimble and flexible to changing market
conditions and work demands, which vary greatly depending on development and construction
activity. While the City has used many consulting firms to provide needed services, it has
maintained a contractual relationship with Stevenson, Porto, & Pierce, Inc., since 1996. This firm has
performed a full range of services provided at the City related to the processing of new residential
and commercial development applications and the inspection of new residential and commercial
construction. SP2’s services have been focused primarily on implementation of the City’s Eastern
Dublin Specific Plan, which was adopted initially on January 7, 1994.
While SP2’s specific services provided over the years have changed, they have ge nerally included
the following.
Field inspections of new construction to assure conformity with the City’s development
design approval. These include both preliminary inspections of exterior treatments, such as
when stucco, siding,and building veneers are applied (commonly referred to as “lath
inspections”),and final inspections.
Review of plot plans, parcel maps,and subdivision maps.
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Plan check of development plans submitted as part of a development application and plan
check of final plans submitted for conformance with approved development plans.
Review of development application-related materials, including environmental impact
reports, traffic studies, zoning maps, etc.
Preparation of general staff material, including reports and studies.
Attendance at City meetings, including City Council and Planning Commission meetings.
The contractual relationship with SP2 and the services it has provided is unique in that it has
occurred over an extended period with a broad scope of services.
Recently, the City identified several SP2 invoices that included a number of service days with an
excessive number of total service hours. In response, on February 16, 2016 the city manager revised
the City’s policies related to consulting services through the issuance of an Administrative Action.
While these revised policies apply to all types of consultant services, they are focused primarily on
services related to the Community Development Department provided in connection with specific
development applications and new construction. An outline of these new policies developed
through the February 16, 2016 Administrative Actions as follows.
1.Require consultants to submit daily logs of total hours worked for the billing period for each
individual employee performing services under the contract.
2.Submit a record of service hours provided for each specific job assignment (individual
Developer Deposit Accounts).
3.Identify consultants required to file Form 700s,in accordance with California Government
Code Section 87200,and notify the consultants of their obligation to file as a condition of
continued service with the City.
4.Establish that beginning in fiscal year 2016-17, no individual consultant shall work over
2,000 hours in a fiscal year,unless specifically authorized by the city manager or his/her
designee.
5.Establish a minimum billing increment of 15-minute blocks of time.
6.Require that any City request for proposals for consulting services require a respondent to
identify what additional public and private clients the consultant is serving at that time.
In addition to the Administrative Action, the city manager also directed staff to provide a detailed
accounting analysis of SP2 daily service hours. These spreadsheets were provided to Management
Partners for our review. While the city manager’s February 16, 2016 Administrative Action is
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currently in use by the organization,the development of contract administrative policies is
recommended.
Project Approach
Management Partners conducted its review of the City of Dublin’s contract administration policies
and procedures using several analytical and management techniques. These steps enabled project
team members to gain an understanding of the existing procedures and enabled us to identify
opportunities to optimize performance in these areas. Our approach included the elements
described below.
Interviews
Management Partners conducted three separate interviews with individuals to gather background
information and opinions about current contract administration practices and the challenges and
benefits the City accrues from using consultant services.From these interviews we learned about
the workflow related to contract administration, specifically, invoice processing;how work is
assigned to consultants and City policies related to these activities;an outline of what is working
well;and opportunities for improvement.We conducted interviews with the following individuals.
Linda Smith, Assistant City Manager
Like Sims, Community Development Director
Jeff Baker, Assistant Community Development Director
Colleen Tribby, Administrative Services Director/Finance Director
Lisa Hisatomi, Assistant Administrative Services Director/Budget
Jay Baska, Financial Analyst
The interview with City employees focused on the City’s current administrative procedures for
administering consultant agreements, processing invoices related primarily to consultant services
provided in the City’s Community Development Department, consultant work assignments, and
the City’s financial spreadsheets chronicling SP2 billed service hours.
We also conducted a telephone interview with Mike Porto,principal with SP2. This interview
included a discussion of the types of work provided to the City, the allocation of assignments and
submittals, and the firm’s current and past invoicing practices.
Document and Data Analysis
Management Partners reviewed a variety of documents and data provided by the City,including
those listed below.
The City’s Purchasing Procedures Manual dated September 2012;
Chapter 2.36, Contracts and Purchasing, from the City’s Municipal Code;
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Sections 1, 2, 3, 8, and 9, of the Consulting Services Agreement Between the City of Dublin
and Stevenson, Porto & Pierce, Inc. for On-Call Contract for Planning Services dated May
15, 2012;
SP2 invoices submitted since 2004;
SP2 revised invoices detailing changes to days with significant recorded hours,and
City financial spreadsheets detailing a historical record of SP2 invoices.
Best Practices
A best practice is defined as the most efficient and effective way of accomplishing a task, based on
favorable experiences in other similar organizations and identification by industry associations. As
things change over time, new best practices emerge and are adopted by leading organizations.We
have included a listing of best practices for consideration later in this memorandum.
Key Observations
Based on our review and analysis, Management Partners has identified the following observations
about the City’s specific practices related to administering the SP2 services agreement and
processing its invoices. While we did not review invoices from other consultants, based on our
interviews,the review process used for SP2 is similar to the process used for similar consultant
service agreements. Therefore, our observations should apply to the City’s overall process of
providing contract administration as well.
Utilizing consulting services for development review has met the City’s goal of obtaining
flexibility consistent with market demands and work requirements. Our review of SP2 invoices
indicates that from fiscal year (FY)2006-07 through FY 2014-15 the number of annual service hours
fluctuated from a low of 3,033 in FY 2008-09 to a high of 4,833 in FY 2013-14. This fluctuation is
consistent with the City’s overall approach of using these services as needed to meet service
demands. Had we not seen this fluctuation, we would have assumed the services were being used
for purposes other than meeting demands on an as-needed basis.
The city manager’s February 16, 2016 Administrative Action represents a positive step in
improving its contract administration practices.The City’s new procedures cover a range of
contract administration practices that will have wide-ranging implications for how it administers
contracts for services. This includes the potential for needing additional firms to provide as-needed
services for staff augmentation work because of the 2,000 hours limitation and an increased burden
on City staff reviewing daily activity logs and services hours. Nevertheless, these are positive and
necessary improvements. Our recommendations listed further in this memorandum include
procedures that expand on this Administrative Action.
Staff markings on SP2 invoices indicate they were approved by City staff consistent with its
practice of having invoices signed off by a management employee prior to submittal to the Finance
Department for payment.We looked at many, but not all, of the SP2 invoices provided and in all
cases, there is clear indication they were reviewed in detail and approved. This is important in that
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it verifies that City staff evaluated the work performed and that appropriate internal controls
occurred prior to issuance of payment.
City staff has been providing appropriate supervision of consultant services to maximize the value
of consultant services.Our interviews indicated the City’s Community Development Department
takes steps to assign work to consultants to assure they remain focused on fundamental tasks
consistent with service demands. In addition, when appropriate, consultants attend staff meetings
to assure they are up to date with current development related issues and procedures. Finally, staff
takes steps to assure that consultant activities, work products,and recommendations to the City
Council and commissions are a direct reflection of City staff and not the consultant. We found no
indication the consultant was acting on matters contrary to staff direction.
The City has not adopted policies for administering consultant service agreements.While it is not
standard for a city to retain a comprehensive policies and procedures manual that provides
guidance to staff regarding the processing of invoices related to service agreements, considering the
amount Dublin relies on these types of services, this type of policy would be effective. As noted in
our recommendation below, these policies should be included in the City’s Purchasing Procedures
Manual.
Services provided by SP2 were consistent with the terms of its service agreement.An attachment to
SP2’s service agreement (provided as Appendix 1 to this memorandum)lists the consultant’s scope
of work as including the following:
Provision of Planning, Public Works, and other developmental services, including, but not
limited to, environmental, architectural, landscape architectural, ecological and/or biological
consulting services to the City of Dublin regarding processing of development entitlements
and processing of City of Dublin projects. Said services shall be performed at the direction of
the Community Development Director on an as -needed basis.
As indicated previously, our review of invoices did not identify cases where services were
performed outside of the above scope. As such, we believe City staff is aware of the consultant’s
scope of services and identify consultant work assignments that comply with the service
agreement. Notwithstanding this observation, a more detailed scope of services included in the
City’s services agreement would benefit staff by focusing assignments, developing work plans, and
improving the transparency of anticipated tasks to be completed.
The Community Development and Administrative Services Departments meet monthly to review
the status of funding required and available for development project reimbursements.Based on the
City’s practice of requiring reimbursement for consultant services related to processing a
development application, the City has established an effective process. The process involves a
monthly meeting of key personnel from the Community Development and Finance Departments to
review activity related to development reimbursements. Our interviews indicated this is a smooth
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process leading to effective tracking of available funding for reimbursement, the status of project
expenditures, and the ability to communicate with developers about project activity.
Invoices submitted by SP2 were generally consistent with the information included in its May 5,
2012 services agreements. However, certain invoicing requirements were not applicable to the work
being provided.We reviewed invoices from FY 2014-15, tested them against Section 2.1 of the
services agreement, and noticed language that did not directly apply to the type of work being
conducted by SP2.As an example, the services agreement requires a task summary containing the
original contract amount, the amount of prior billings,a balance and percent of completion,which
creates a running total/balance for the expenditure of hours. However, this type of accounting is
inconsistent with the type of as-needed work provided and therefore,was not applicable to the
preparation of invoices.The concern with this issue is not with lack of compliance, but assuring
that contract language is specific to the service provider and the type of work being completed.
On another matter, the services agreement with SP2 requires SP2 to include a separate notice when
the total number of hours of work by consultant, employee, agent,or subcontractor reaches or
exceeds 800 hours. We did not see a record of this notice. In other aspects,though,the invoicing
was consistent with the services agreement.
The format of SP2 invoices submitted prior to December 29, 2015 was designed in a manner that
allowed City staff to review work completed and prepare invoices for reimbursement from
developers on a project-by-project basis. The format of invoices prior to December 29, 2015 (when
at City direction they were amended), highlighted hours expended and type of work completed for
each individual development project (each of which has a corresponding account number)serviced
by SP2. This format was advantageous because it allowed Community Development Department
staff to effectively review and evaluate work completed on a project-by-project basis, which is an
important component of project monitoring.
This project-based reporting was also effective for the Finance Department, which is responsible for
invoicing developers for work completed on each individual development project. During our
interviews, City staff indicated they received full reimbursement from developers for work
performed by SP2 and this is attributable, in some part, to the fact that the invoicing effectively
identified services provided by development project.
The format of SP2’s invoices submitted prior to December 29, 2015 did not adequately provide for
an efficient review of daily service hours.Because the formatting of invoices prior to December 29,
2015 highlighted services hours by project, tracking daily service hours was cumbersome and most
likely led to lack of emphasis on total activity by day. As an example, invoice Number 00997 dated
August 11, 2015 (Appendix 2)consists of individual billing information for 20 separate
development projects.For the City to calculate the daily hours billed, it would have had to examine
development activity for each of these projects and then extract and calculate daily hours billed in a
separate spreadsheet. Because the City’s focus was on reviewing the appropr iateness of the total
hours billed for each serviced development project and the total services provided, this step did not
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occur. In addition, due to staff’s focus on reviewing the type and total amount of services provided
and the emphasis on allocating these services to a specific development project, undertaking the
task of calculating service hours by day was not viewed as critical to the overall review process. It
should be noted that SP2’s service agreement does not require providing a daily total of services
provided.
City staff has implemented a change in the format and content of consultant invoices that will
meet its objectives of obtaining more detailed billing information. Our interviews with City staff
and SP2 indicated that in December 2015 the City instructed SP2 to modify the formatting and
content of SP2 invoices to include a summary of service hours by day and a total of daily service
hours for each SP2 employee providing service to the City. This action was followed with the city
manager’s February 16, 2016 Administrative Action requiring all consultants to include this detail.
We reviewed SP2 invoices since December 29, 2015 and verified they are consistent with City
direction to include service hours of each employee assigned to each project by day and by activity.
As such, the City now has an effective method of identifying daily service hours provided. In
addition, the City now requires a summary of services provided by day. This should also improve
its overall contract administration. A sample of this revised invoice is included as Appendix 3.
It would be difficult for the City to determine if SP2 service hours billed on a specific day prior to
December 29, 2015 were in error or misappropriated from another day of activity.The City
identified that some SP2 invoices included excessive billing hours on a number of specific days.
During our interviews, SP2 recognized this concern and indicated that the amount of service hours
recorded for these days were in error. In response, it submitted revised invoices correcting the
billing irregularities by reassigning billed service hours to other days.However, regardless of this
response,the City and SP2 have not adopted a system for tracking and recording the amount of
daily hours worked on a specific day. Therefore, determining the actual number of hours worked
and the days when they occurred is dependent on the SP2’s informal notes and records.Further,
prior to 2013,the City did not require SP2 to provide invoices with daily billing hours as it was
focused on the reasonableness of the bi-weekly project billing. However, in 2013, SP2 changed its
billing practice to include daily billing records.
Recommendations
Based on our review, we have identified eight recommendations to improve the City’s current
contract administration practices.These recommendations build on the February 16, 2016
Administrative Action already in place, which as indicated, represents a significant step toward
addressing the goal of establishing best practice procedures that can be incorporated fully into the
City’s day-to-day operations.
1.The City’s Purchasing Procedures Manual includes important information about processes for
the acquisition of services and goods. However, considering the City’s reliance on cons ultant
services, this document would be improved by adding a section related to administering
contract service activities.
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Recommendation 1.Amend the City’s Purchasing Procedures Manual and/or the
City Municipal Code to incorporate contract administration procedures.
To implement Recommendation 1, we have identified five specific actions below.
a)Differentiate between contract services performing project-specific tasks and consultant
services performing as-needed staff augmentation work. Adopt separate policies for
both types of services.
b)Incorporate monitoring and approval procedures by the management employee most
familiar with the consultant’s work and the department head consistent with
Recommendation 6.
c)Establish an annual cap of consultant service hours and provide a process for
considering an adjustment to it and approving or denying an adjustment to the original
cap.
d)Incorporate the city manager’s February 16, 2016 Administrative Action.
e)Include a solicitation process for securing consultant services.
2.The current May 15, 2012 services agreement with SP2 includes standard contract terms that
clearly identify critical contract administration requirements for invoicing requirements, scope
of work, fees, etc. However, if this agreement is to be used as a model or master agreement for
similar consulting service agreements, it should be amended to reflect applicable policies from
the city manager’s February 16, 2016 Administration Action and additional language to be
consistent with the City’s amended Purchasing Procedures Manual.
Recommendation 2.Amend the City’s standard consultant service agreements for
as-needed staff augmentation services.
To implement Recommendation 2, we have identified six specific actions below.
a)Require consultants providing as-needed staff augmentation services to provide a total of
daily service hours for each consultant providing service to the City and grand total of all
service hours detailed by day and billing period.
b)Require consultants providing as-needed staff augmentation services to provide more detail
concerning its scope of work to clearly identify specific expectations and service scope .
c)Establish the total dollar amount of the contract.
d)Include a cap on the maximum number of annual service hours to an amount determined
appropriate to retain independent consultant status and be consistent with city policy.
Where possible,fix service to a specific project of task and require separate tracking.
e)Include either a clearly identified consultant service fee escalator or a process for the
consultant to request service fee adjustments. (This inclusion would apply to contracts with
a term in excess of two years.)
f)When applicable, include contract performance monitoring provisions.
3.Because it is most likely impractical to unilaterally amend existing consultant service
agreements to be in full compliance with Recommendation 2, at a minimum the City should
take action to inform consultants of its invoicing procedures.
Review of the City of Dublin’s Contract Administration
Policies, Practices, and Procedures for Consultant Services Page 10
Recommendation 3.Inform all consultants in writing of the City’s new invoicing
requirements and request their immediate adoption.
4.Our interviews identified the high quality of services received by using as-need consultant
services and the flexibility and advantages this usage brings to the City operations. Further, the
retention of an individual consulting firm over time also brings advantages to the City because
of the familiarity and experience the consultant gains with the community and work product
expectations. However, the term of the SP2 services agreement is for one year with automatic
renewals unless the agreement is terminated by the City.
It is a best practice to establish a reasonable limit on the length of agreements for consultant
services.When the term limit is reached, the City should pursue a consultant solicitation
process to gain assurance that services are consistent with market conditions and to be
transparent in its selection process. Based on research, determining the ideal length of a contract
is dependent on the types of services provided.Therefore, staff should evaluate this matter
prior to preparing individual services agreements.
Recommendation 4.Adopt a policy requiring consultant services agreements to
include a reasonable term limit based on an evaluation of service needs.
5.Section IX (C) of the City Purchasing Procedures Manual establishes that the City’s Purchasing
Agent is authorized to approve consultant or professional service agreements that are less than
$45,000. City Council approval is required for these agreements over $45,000.Due to the unique
nature of as-needed consultant services agreements for staff augmentation work,staff should
review this threshold limit. The purpose of the review would be to gain assurance that the
amount provides and appropriate level of transparency and to assure that the City Council and
community are fully aware of these services. While we have seen City Council approval
required for consultant services as low as $20,000, it would be best if City staff evaluates its
ongoing needs and activities and determines an appropriate amount.Approval of a new limit
should be subject to City Council approval.
Recommendation 5.Conduct a review of current Purchasing Agent authorization
limits for approving as-needed services agreements for staff augmentations
services.
6.While we observed that City staff provided adequate oversight of consultant activities, our
interviews identified an opportunity to improve the overall contract administration process for
consultants providing as-needed staff augmentation services. This can be achieved by requiring
written work plans that clearly identify expectations and establish a record of activity
performed. This process would also help both the City and the consultant when preparing and
reviewing services performed and invoicing.In general, a work plan would include
identification of service hours by task (when applicable) performance testing, and a method for
tracking daily service hours.
Review of the City of Dublin’s Contract Administration
Policies, Practices, and Procedures for Consultant Services Page 11
Recommendation 6.Develop a work plan identifying project specific
assignments and performance expectations before entering into a consultant
service agreement for as-needed staff augmentation work.
7.It is important for the City to establish a policy and process consistent with Internal Revenue
Service and California Public Employees Retirement System requirements to determine a
consultant’s independent contractor status.While we understand that this has occurred to some
degree, we did not see reference to this testing in the Purchasing Procedures Manual or other
information received and therefore,we assume that it is not part of an existing administrative
policy and/or ongoing contract administration process.
Recommendation 7.Establish a policy detailing requirements and testing
procedures for determining independent contractor status, particularly for those
consultants performing as-needed staff augmentation work.
8.While our interviews indicated the City generally issues a purchase order for each service
contract, it was not determined whether this was a standard City policy or that it was always
adhered to.
Recommendation 8.Require issuance of a purchase order annually for all
consultant service contracts with an amount equal to the maximum value of the
service contract.
Best Practices
The following practices enable an organization to manage consultant services in the most effective
manner.These practices require proactive management and coordination across departments.
Although a number of these practices may already be in place, they are provided as a
comprehensive guideline rather than an evaluation of practices currently in place and are offered
for reference and future planning.
Conduct Regular Testing to Determine Independent Contractor Status.Assuring that consultants
engaged in as-needed staff augmentation duties retain independent contractor status is an
important analytical process that should be pursued when relying on contract services. Therefore,
regular testing by a City’s Human Resources Department is critical.Consultant services activities
and work practices should be managed to ensure consistency with independent contractor status.
Maintain an Internal Committee Responsible for Monitoring Developer Reimbursement
Agreements for Development Application Processing.A growing community relies on
reimbursements from developers of new development projects to offset the cost of project
processing and inspection. It is important that the City regularly track this activity to ensure
compliance with the individual reimbursement agreements and funding.
Avoid Consultant Agreements that are Open Ended in Terms of Cost, Service Hours,and Contract
Term.While it may be difficult to estimate service hours for as-needed consultant service
agreements,all agreements should specify a maximum number of service hour and fee limits.
Review of the City of Dublin’s Contract Administration
Policies, Practices, and Procedures for Consultant Services Page 12
Service in addition to the originally stated hours should be approved only through an amendment
to the agreement. The term limit of the contract should be clearly defined.
Establish Procedures for Contract Monitoring.A clearly defined policy for administering
consultant agreements is an important element for assuring that individual departments are
uniformly administering contracts. For best results, supervisory employees closest to the work
being completed should be most active in developing work plans, performance testing, estimating
required service hours, general oversight, and the tracking of service hours.Monitoring should also
include the consultant’s use of its employees, sub-consultants,and agents. Upper management is
typically involved with approval of work plans and financial matters.
Establish Uniform Consultant Invoicing Requirements that Meet the City’s Needs and are
Transparent.Invoices should include summary as well as detailed information demonstrating
consistency with service scope and billable hours. All service hours billed for on-site services
should be consistent with daily logs maintained by the contract administrator. Contractors should
be informed regularly of invoicing requirements, which should also be part of their service
agreements.
Regularly Monitor Contract Activity to Ensure Consistency with City Financial Policies.Utilize
the Internal Committee to monitor reimbursement agreements to review conformance with
financial policies. This will improve contract monitoring effectiveness. Monitoring may include
conformance with issued purchase orders, appropriate payment approvals, expense
reimbursements, and appropriate documentation verifying consultant service hours or activities
that may appear to be inconsistent with contract terms.
Conclusion
The City has taken significant steps to improve its contact administration practices and has
requested a review to receive observations and recommendations on further developing its
practices and policies. This memorandum provides one source of additional information and is
intended to assist the City with this process.
We are available to meet with you to discuss our observations and recommendations.
Attachments
Attachment A –Management Partners’Engagement Letter Dated March 2, 2016
Appendix 1 –Consulting Services Agreement between the City of Dublin and Stevenson, Porto &
Pierce, Inc. for On-Call Contract for Planning Services dated May 15, 2012
Appendix 2 –Stevenson, Porto & Pierce Invoice dated August 11, 2015
Appendix 3 –Stevenson, Porto & Pierce Invoice dated December 29, 2015
Management
Pa rtners
March 2,201.6
Ms. Linda Smith
Assistant City Manager
City of Dublin
100 Civic Center Plaza
Dublin, CA 95468
Dear Ms. Smith:
Thank you for this opportunity to assist the City of Dublin with the development of an
amended policy for the preparation and administration of service contracts for specialty
services. We understand that in a recent meeting with the City Council staff indicated they
would seek professional consulting services to assist with this effort and we are prepared to
respond in an effective and expedited manner.
We recognize that the City of Dublin has a history of using contract services for a range of
administrative needs, including planning and community development and that this approach
has been effective in addressing the City's service delivery needs. We also understand that
periodically it is necessary to review the procedures used to administer service contracts,
(particularly those that have been in place for an extended period), to assure they comply fully
with best practices. Management Partners has the skills needed to provide this consulting
assistance, and we would be pleased to do so.
Understanding of the Engagement
To ensure that the City of Dublin is administering its service contracts consistent with best
practices for contract m.rnagemen! the City has identified the need to review the procedures
used to develop, draft and administer them. We understand that the City has historically relied
on service contracts for a wide range of services, including those related to development
application reviews, field inspections, architectural reviews, engineering services, and other
specialized administration functions.
There are many factors to determine service contract effectiveness, including identifying service
contract needs, legal requirements, cost efficiency and the requirements of the service provider.
Further, because service providers are often relied on to provide time-critical and labor
intensive services, it is important that there are checks and balances that can be used to track
activity effectively and accurately during times of high demand.
1730 Mrorsoru Rono . Clrucrrunarr, OH 45206 . 513 861 5400 . Frx 513 8613480 MANAGEMENTPARTNERS.coM
2107 NonrH FrRsr SrnErr, SutrE 470 . SAN JosE, Cnuronrutn 95131 . 408 437 5400 . Fax 408 453 6191
3152ReoHILLAvrruur,SutrE21O. CosrAMesn,Cnuronung2526 .949222LO82. Fnx4084535191
Ms. Linda Smith Page2
In discussing this engagement, you expressed specific interest in reviewing contract
administration procedures related to the Community Development Department, which is
responsible for processing development applications, among other things. Further, you
indicated that City staff has already begun an intemal review of past contractor billings, and
they have prepared an amended draft set of contract administration procedures.
Considering this activity to date, our proposed scope of services would include:
. Review existing service contracts to determine their overall effectiveness in addressing
the City's needs as well as compliance with intemal procedures;
o Review the City-prepared draft amended contract administration procedures;
o Interview the City's Community Development and Administrative Services directors to
determine the department's specific needs and expectations from service contract
providers;
e Review the City's policies for awarding and administering service contracts, including
contract extensions and amendments;
. Conduct research into best practices for service contracting including standards for
billing submittals and review; and
o Review current billing and accounts payable procedures related to payments for service
contracts.
To make this project most usefuL we will have ongoing communications with you (or the City's
project manager) and designated staff to ensure we are accurately portraying existing practices,
and that our recorunendations and solutions are feasible within existing administration and
capabilities. Because we recognize that City staff members are busy with the ongoing work of
the organizatiory we will coordinate all scheduling and contacts through your office to
minimize any disruption.
As you know, the City has an active hourly services agreement with Management Partners, so
we anticipate this additional work can be authorized with acceptance of this proposal and
issuance of an expanded purchase order, as necessary. However, we will rely on your direction
for the requirements needed to commence work.
Our team will be led by Special Advisor Steven Bocian, a former assistant city manager and
communitlz development director, and with assistance from Hossein Golestan, a special advisor
with particular expertise in finance and financial procedures. Biographical information for both
team members is attached.
It is anticipated that this work will take between 40 and 50 hours to complete. The hourly rate
for Steven and Hossein is $190 per hour, plus expenses. Therefore/ we suggest an hourly
contract not to exceed $10000. We estimate the work can be done in between four and six
weeks, subject to additional direction and requests from the City.
Ms. Linda Smith
We appreciate the opportunity to be of assistance to the City of Dublin. Please feel free to
contact me at (513) 313-0503 if you have any questions about this proposal.
Sincerely,
Page 3
Gerald E. Newfarmer
President and CEO
Accepted for the City of Dublin by:
Ms. Linda Smith Page 4
Attachment - Consultant Bio graphies
SrnvuN R. BocmN
Steven Bocian, Special Advisor, brings over 30 years of municipal management experience
through his work with the cities of Arcadia and Pleasanton, Califomia. Over his career, he
directed significant projects to meet the needs of a growing community and region, including
those related to service enhancements, staff development and community planning.
During 27 years in Pleasanton as assistant city manager, Steven was responsible for directing a
full range of complex community projects. Some examples include establishing a municipal
library, planning for a 123-acre mixed-use developmen! developing a 105-unit affordable
assisted living facility with 19 memory-care units, developing an inclusionary housing zoning
ordinance, and developing numerous park projects. He brings significant expertise in the areas
of affordable housing capital improvement budgeting and programming policy development,
refuse and recycling programs, rates and franchise agreements, and project management for
both large and small city capital projects. Recently, Steven completed planning for a 54-acre
community park with three all-weather lighted multi-purpose sports fields and a large open
space area with trails.
In addition to a full range of community-based projects, Steven has significant experience with
administrative functions. These include labor negotiations, purchasing and capital
management budgeting policy analysis, animal control services, and program evaluation.
Steven graduated from Califomia State University, Hayward (now California State University,
East Bay) with a master's degree in Public Administration. He has served as a board member
for several non-profit housing organizations.
Ms. Linda Smith Page 5
HossuN Gomsreu
Hossein Golestan, Special Advisor, has over 30 years of combined municipal financial
management public accounting and corporate financial management experience. His expertise
in all aspects of municipal finance includes capital financing, accounting, auditing, budgeting
treasury, purchasing and fleet management. He also has experience in the selection and
implementation of financial software and GASB implementation.
During his career, Hossein was known for his critical thinking and ability to produce creative
solutions to complex and challenging problems.
Hossein's experience started in England lr:.1,972 when he worked for four years in a firm of
Chartered Accountants as part of the required training to become a Chartered Accountant in
that country. He also worked in Iran as a finance and investment manager in an investrnent
banking firm for five years prior to immigrating to the United States in 1983.
Hossein worked for the City of San Mateo for approximately 25 years/ in progressively
responsible positions, concluding with five years as finance director before retiring from that
clty in 2010. Prior to his appointrnent as finance director, Hossein served as a staff accountant
and accounting manager in San Mateo, and as assistant financial services director for the City of
Fremont.
As finance director in San Mateo, he oversaw the Finance Deparhnent's 15 employees, annual
budget of $140M and inveshent portfolio of $100M. He was responsible for budgeting
preparing a two-year business plan, and the following functions: accounting, financial
reporting inveshnents, business license tax, payroll, accounts payable, accounts receivable, debt
administration, purchasing and fleet management. Since his retirement from San Mateo, he has
been providing consulting services with Management Partners to municipal agencies.
Hossein also has received training in interest-based negotiations and process reengineering. He
has extensive experience working with acfuarial reports for retirement, workers compensation,
and liability.
Hossein holds a bachelor's degree in economics from Tehran University, Iran, and is a
Chartered Accountant from England.
CONSULTINGSERVICES AGREEMENT BETWEEN
THE CITY OF DUBLIN AND STEVENSON PORTO& PIERCE, INC.
ON-CALL CONTRACT FOR PLANNINGSERVICES
THIS AGREEMENT for consultingservices is made by and betweenthe City of Dublin ("City") and
Stevenson Porto & Pierce, Inc. ("Consultant")as of May 15, 2012.
Section 1. SERVICES. Subject to the terms and conditionsset forth in this Agreement, Consultant shall
provide to City theservices described in the Scope of Services attached as Exhibit A at the time and place and in the
mannerspecified therein. In the event of a conflict in or inconsistency between the terms ofthis Agreement and
Exhibit A, the Agreement shall prevail..
1.1 Term of Services. Thetermofthis Agreement shallbegin on July 1, 2012 and shallend one year
thereafter, except that the Agreement shall be automatically extended from year to year unless the
Agreement is otherwiseterminated, as provided for in Section 8.
1.2 Standard of Performance. Consultant shallperform all services required pursuant to this
Agreement in the manner and according to the standards observed by a competent practitioner of
the profession in which Consultant is engaged in the geographical area in which Consultant
practices its profession. Consultant shall prepare all work products required by this Agreement in a
substantial, first-class manner andshall conform to the standards of quality normally observed by a
person practicing in Consultant's profession.
1.3 Assignment of Personnel. Consultant shallassign only competent personnel to perform services
pursuant to this Agreement. In the event that City, in its sole discretion, at any time duringthe term of
this Agreement, desires the reassignment of any such persons, Consultant shall, immediately upon
receiving notice from City of such desire of City, reassign such person or persons.
1.4 Time. Consultant shall devote such time to the performance of servicespursuant to this Agreement
as may be reasonably necessary to meet thestandardofperformance provided in Section 1.2 above
andto satisfy Consultant's obligations hereunder.
Section 2. COMPENSATION. Cityherebyagreesto pay Consultant the hourly sum set forth in the
Compensation Schedulecontained in Exhibit B, notwithstanding any contraryindications that may be contained in
Consultant's proposal, for services to be performed and reimbursable costsincurred underthis Agreement. In the
event of a conflict between this Agreement and Consultant's proposal, attached as Exhibit A, regarding the amount of
compensation, the Agreement shallprevail. City shall pay Consultant for services renderedpursuant to this
Agreement at the time and in themanner set forth herein. The paymentsspecified belowshall be the only payments
fromCity to Consultant for services rendered pursuant to this Agreement. Consultant shall submit all invoices to City
in the manner specified herein. Except as specifically authorized by City, Consultant shall not bill City for duplicate
services performed by morethan one person.
Consultant and City acknowledge and agree that compensation paid by City to Consultant under this Agreement is
based upon Consultant's estimatedcosts of providing theservices required hereunder, includingsalaries and
benefits of employees and subcontractors of Consultant. Consequently, the parties further agree that compensation
hereunder is intended to include the costs of contributions to any pensions and/or annuities to which Consultant and
its employees, agents, and subcontractorsmay be eligible. City therefore has no responsibility for such contributions
beyond compensation required under this Agreement.
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto & Pierce, Inc. Page 1 of 11
2.1 Invoices. Consultant shallsubmit invoices, not more oftenthan once a monthduring the termof this
Agreement, based on the cost for services performed and reimbursable costs incurred prior to the
invoice date. Invoices shall contain the following information:
Serial identifications ofprogress bills; i.e., Progress Bill No. 1 for the firstinvoice, etc.;
The beginning and ending dates of the billing period;
A Task Summary containing theoriginal contractamount, the amount of prior billings, the
total due this period, the balance availableunder the Agreement, and the percentage of
completion;
At City's option, for each work item in each task, a copy of theapplicable time entries or time
sheets shall be submittedshowing thename of the persondoing thework, the hoursspent
by each person, a brief description of thework, and each reimbursable expense;
The total number of hours ofwork performed under the Agreement by Consultant and each
employee, agent, and subcontractor of Consultant performing services hereunder, as well as
a separate noticewhen the total number of hours of work by Consultant and any individual
employee, agent, or subcontractor of Consultantreaches or exceeds 800hours;
The Consultant's signature.
2.2 Monthly Payment. City shallmake payments, based on invoices received,for services satisfactorily
performed, and for authorized reimbursable costs incurred. City shall have 30 days fromthereceipt
of an invoice that complies with all ofthe requirements above to pay Consultant.
2.3 'Reserved.'
2.4 Total Payment. City shall pay for the services to be rendered by Consultant pursuant to this
Agreement. City shall not payany additional sum for any expense or cost whatsoever incurred by
Consultant in rendering services pursuantto thisAgreement. City shallmake no payment for any
extra,further, or additional servicepursuant to this Agreement.
In no event shall Consultantsubmit any invoice for an amount in excessof the maximumamountof
compensation provided above either for a task or for the entire Agreement, unless the Agreement is
modified prior tothesubmissionof such an invoice by a properly executedchange order or
amendment.
2.5 Hourly Fees. Fees forwork performed by Consultant on an hourly basis shall not exceed the
amounts shown on the Compensation Schedule contained in Exhibit B.
2.6 Reimbursable Expenses. Payment shall be limited to the hourly rates contained in Exhibit B. No
reimbursable expenses shall be paid.
2.7 Payment of Taxes. Consultant is solelyresponsible for the payment ofemploymenttaxes incurred
under this Agreement and any similar federal or statetaxes.
2.8 Payment upon Termination. In the event thattheCity or Consultantterminates this Agreement
pursuant to Section 8, the City shall compensate the Consultant for all outstandingcosts and
reimbursableexpenses incurred for work satisfactorily completed as of the date of written notice of
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto& Pierce, Inc. Page 2 of 11
termination. Consultant shall maintain adequate logs and timesheets in order to verify costs incurred
to thatdate.
2.9 Authorization to Perform Services. The Consultant is not authorized to performany services or
incur any costs whatsoever under the terms of this Agreement until receipt of authorization from the
Contract Administrator.
Section 3. FACILITIES AND EQUIPMENT. Except as set forthherein, Consultant shall, at its solecost and
expense, provide all facilities and equipment that may be necessary to perform the services required by this
Agreement. City shallmake available to Consultant only the facilities and equipment listed in this section, and only
under theterms and conditions set forth herein.
City may furnishphysical facilities such as desks, telephone service, filing cabinets, and conference space, as may
be reasonably necessary for Consultant's use while consulting with City employees and reviewing records and the
information in possession of the City. The location, quantity, and time of furnishing those facilities shall be in the sole
discretion of City.
Section 4. INSURANCEREQUIREMENTS. Before beginning any work under this Agreement, Consultant, at
its own cost and expense, shall procure "occurrence coverage" insuranceagainst claims for injuries to persons or
damages to property that may arise from or in connection with the performance of thework hereunder by the
Consultant and its agents, representatives, employees, and subcontractors. Consultant shall provide proof
satisfactory to Cityof such insurance that meets the requirements of this section and underforms of insurance
satisfactory in all respects to the City. Consultant shall maintain the insurance policiesrequired by this section
throughout the termof this Agreement. The cost of such insurance shall be included in the Consultants bid.
Consultant shall notallow any subcontractor to commence work on any subcontract until Consultant has obtained all
insurance required herein for the subcontractor(s) and provided evidence thereof toCity. Verification of the required
insurance shall be submitted and made part of this Agreement prior to execution.
4.1 Workers' Compensation. Consultant shall, at its sole cost and expense, maintain Statutory
Workers' Compensation Insurance and Employer's Liability Insurance for any andall persons
employed directly or indirectly by Consultant. The StatutoryWorkers' CompensationInsurance and
Employer's LiabilityInsurance shall be providedwith limits of not lessthan ONE MILLION DOLLARS
1,000,000.00) peraccident. In the alternative, Consultant may rely on a self-insurance program to
meet those requirements, but only if the program of self-insurance complies fully with the provisions
of the California Labor Code. Determination of whether a self-insurance program meets the
standardsof the Labor Code shall be solely in the discretion of theContract Administrator. The
insurer, if insurance is provided, or theConsultant, if a programof self-insurance is provided, shall
waive all rights of subrogation against the City and its officers, officials, employees, and volunteers
for loss arisingfrom work performed under this Agreement.
An endorsement shall state that coverage shall not be suspended, voided, canceled by either party,
reduced in coverage or in limits, except after thirty (30) days' prior written notice by certified mail,
return receipt requested, has been given to the City. Consultant shall notify City within 14 daysof
notificationfrom Consultant's insurer if such coverage is suspended, voided or reduced in coverage
or in limits.
4.2 Commercial General and Automobile Liability Insurance.
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto& Pierce, Inc. Page 3 of 11 .
4.2.1 General requirements. Consultant, at its own cost and expense,shall maintain commercial
general and automobile liability insurance for the term of this Agreement in an amount not
less than ONE MILLION DOLLARS ($1,000,000.00) per occurrence, combined single limit
coverage for risks associated with the work contemplated by this Agreement. If a
Commercial GeneralLiabilityInsurance or an Automobile Liabilityform or other form with a
general aggregate limit is used, either the general aggregate limit shall apply separately to
the work to be performed under this Agreementor thegeneral aggregate limit shall be at
least twice the required occurrence limit. Such coverage shall include but shall not be
limited to, protection against claimsarisingfrom bodily and personalinjury, includingdeath
resulting therefrom, and damage to propertyresultingfrom activities contemplatedunder this
Agreement, including the use of owned andnon-owned automobiles.
4.2.2 Minimum scope of coverage. Commercial generalcoverage shall be at least as broad as
Insurance Services Office Commercial General Liability occurrence form CG0001.
Automobile coverage shall be at least as broad as InsuranceServices Office Automobile
Liability form CA 0001 Code 1 ("any auto"). No endorsement shall be attached limitingthe
coverage.
4.2.3 Additional requirements. Each ofthe following shall be included in the insurance
coverage or added as an endorsement tothe policy:
a. City and its officers, employees, agents, and volunteers shall be covered as
insureds with respect to each of thefollowing: liability arising out of activities
performed by or on behalf of Consultant, including theinsured's generalsupervision
of Consultant; products and completed operations of Consultant; premises owned,
occupied, or used by Consultant; and automobiles owned, leased, or used by the
Consultant. Thecoverage shallcontain no special limitations on the scope of
protection afforded to City or its officers, employees, agents, or volunteers.
b. The insurance shall cover on an occurrence or an accident basis, and not on a
claims-made basis.
c. An endorsement must state that coverage is primaryinsurance with respect to the
City and its officers, officials, employees and volunteers, and that no insurance or
self-insurance maintained by the City shall be called upon tocontribute to a loss
under the coverage.
d. Any failure ofCONSULTANTto comply withreporting provisions of thepolicy shall
not affect coverage provided to CITY and its officers, employees, agents, and
volunteers.
e. An endorsement shall state that coverage shall not be suspended, voided, canceled
by either party, reduced in coverage or in limits, except after thirty (30) days' prior
written notice by certified mail, return receipt requested, hasbeen giventotheCity.
Consultant shall notify City within 14 days of notification from Consultant's insurer if
such coverage is suspended, voided or reduced in coverage or in limits
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto& Pierce, Inc. Page 4 of 11
4.3 Professional Liability Insurance. Consultant, at its owncost and expense, shall maintain for the
periodcovered by this Agreement professionalliability insurance for licensed professionals
performing work pursuant to this Agreement in an amount notless than ONE MILLION DOLLARS
1,000,000)coveringthe licensed professionals'errors and omissions.
4.3.1 Any deductible or self-insuredretention shall not exceed $150,000 per claim.
4.3.2 An endorsement shall state that coverage shall not be suspended, voided, canceled by
either party, reduced in coverage or in limits, exceptafterthirty(30)days' prior written notice
by certified mail, return receiptrequested, has been given to the City.
4.3.3 The policy must contain a crossliability or severabilityofinterest clause.
4.3.4 The following provisions shall apply if the professional liability coverages are written on a
claims-made form:
a. The retroactive date of the policymust be shown and must be before the dateof the
Agreement.
b.Insurancemust be maintained and evidence of insurance must be provided for at
leastfive years after completion ofthe Agreement or thework, so long as
commercially available at reasonable rates.
c.If coverage is canceled or not renewed and it is not replacedwith another claims-
madepolicyform with a retroactive date that precedesthedateofthis Agreement,
Consultant mustprovide extended reporting coverage for a minimum of five years
after completionofthe Agreement or the work. The Cityshall have the right to
exercise, at the Consultant's solecost and expense, any extended reporting
provisions of the policy, if the Consultant cancels or does not renew the coverage.
d. A copy of theclaim reporting requirements must be submitted to theCity prior tothe
commencement of any work under this Agreement.
4.4 All Policies Requirements.
4.4.1 Acceptabilityof insurers. Allinsurance required by this section is to be placedwith
insurers with a Bests' ratingof no less than A:VII.
4.4.2 Verification of coverage. Prior to beginning any work under this Agreement, Consultant
shall furnish City with certificates ofinsurance and with original endorsements effecting
coverage required herein. The certificates and endorsements for each insurancepolicy are
to be signed by a person authorized by that insurer tobind coverage on its behalf. TheCity
reserves the right to require complete, certifiedcopiesof all requiredinsurance policies, at
anytime.
4.4.3 Subcontractors. Consultant shall include all subcontractors as insureds under its policies
or shall furnishseparate certificates and endorsements for each subcontractor. All
coverages for subcontractors shall be subject to all of the requirements stated herein.
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto & Pierce, Inc. Page 5 of 11
4.4.4 Variation. The City may approve a variation in the foregoinginsurance requirements, upon
a determination thatthe coverages, scope, limits, and forms of such insurance are either not
commercially available, or thatthe City's interests are otherwisefully protected.
4.4.5 Deductibles and Self-Insured Retentions. Consultant shall disclose toand obtain the
approval of City for the self-insuredretentions and deductibles beforebeginningany of the
services or work called for by any termof this Agreement.
Duringtheperiod covered by thisAgreement, only upon theprior express written
authorization of Contract Administrator, Consultant may increase such deductibles or self-
insured retentions with respect to City, its officers, employees, agents, and volunteers. The
Contract Administrator may condition approvalof an increase in deductible or self-insured
retention levels with a requirement that Consultant procure a bond, guaranteeing paymentof
losses and related investigations, claimadministration, and defense expenses that is
satisfactory in all respects to each of them.
4.4.6 Notice of Reduction in Coverage. In the event that any coverage required by this section
is reduced, limited, or materiallyaffected in any othermanner, Consultant shall provide
written notice to City at Consultant's earliest possible opportunity and in no case later than
fivedaysafter Consultant is notified ofthechange in coverage.
4.5 Remedies. In addition to any otherremedies City may have if Consultant fails to provide ormaintain
any insurancepolicies or policy endorsements to the extent and within the timeherein required, City
may, atits sole optionexercise any ofthe following remedies, which are alternatives toother
remedies City mayhave and are not the exclusive remedy for Consultant's breach:
Obtain such insurance and deduct andretainthe amount of the premiums for such insurance
from any sums due under the Agreement;
Order Consultant to stop work under thisAgreement or withhold any payment that becomes due
to Consultant hereunder, or both stop work and withhold anypayment, until Consultant
demonstratescompliance with the requirements hereof; and/or
Terminate this Agreement.
Section 5. INDEMNIFICATION ANDCONSULTANT'S RESPONSIBILITIES. Consultant shall indemnify,
defend with counselselected by the City, andhold harmless the City and its officials, officers, employees, agents,
and volunteersfrom and against any andall losses, liability, claims, suits, actions, damages, and causes of action
arising out of any personalinjury, bodily injury, loss of life, or damage to property, or any violation of any federal,
state, or municipal law or ordinance, to the extent caused, in whole or in part, by thewillful misconduct or negligent
acts oromissions of Consultant or its employees, subcontractors, or agents, by acts for which theycould be held
strictly liable, or by the quality or character of theirwork. The foregoing obligation of Consultant shall not apply when
1) the injury, loss of fife, damage to property, or violation of lawarises whollyfrom thenegligence or willful
misconduct of theCity or its officers, employees, agents, or volunteers and (2) the actions of Consultant or its
employees, subcontractor, or agentshave contributed in no part to the injury, loss of life, damage to property, or
violation of law. It is understoodthatthe duty of Consultant to indemnify andhold harmless includes the duty to
defend as set forth in Section 2778 of the California Civil Code. Acceptance by City of insurance certificates and
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto& Pierce, Inc. Page 6 of 11
endorsements required under this Agreement does notrelieve Consultant fromliability under thisindemnification and
hold harmless clause. This indemnification andhold harmlessclause shall apply to any damages orclaims for
damages whetheror not such insurance policies shall have been determined to apply. By executionofthis
Agreement, Consultant acknowledges and agrees to the provisions of this Section and that it is a material element of
consideration.
In the event thatConsultant or any employee, agent, or subcontractor of Consultant providing services underthis
Agreement is determined by a court of competent jurisdiction or the CaliforniaPublic Employees RetirementSystem
PERS) to be eligible for enrollment in PERS as an employee of City, Consultantshallindemnify, defend, andhold
harmless City for the payment of any employee and/or employercontributionsfor PERS benefits on behalf of
Consultant or its employees, agents, orsubcontractors, as well as for the payment of any penalties and interest on
such contributions, which would otherwise be the responsibility of City.
Section 6. STATUS OF CONSULTANT.
6.1 Independent Contractor. At alltimes during the termofthis Agreement, Consultant shall bean
independent contractor and shall not bean employeeof City. City shall have the right to control
Consultant onlyinsofar as the results of Consultant's servicesrenderedpursuant to this Agreement
and assignment of personnel pursuant to Subparagraph 1.3; however, otherwise City shall nothave
theright to control the means by which Consultant accomplishesservices rendered pursuant to this
Agreement.
6.2 Waiver of Employee Benefits. Notwithstanding any other City, state, orfederalpolicy, rule,
regulation, law, or ordinance tothe contrary, Consultant and any of its employees, agents, and
subcontractors providing services under this Agreement shall not qualifyfor or becomeentitled to,
and hereby agree towaive any andall claims to, any compensation, benefit, oranyincident of
employment by City, includingbutnot limited to eligibility to enroll in the CaliforniaPublicEmployees
Retirement System(PERS) as an employee of City and entitlement to any contribution to be paid by
City foremployercontributions and/or employeecontributions for PERS benefits.
6.3 Consultant No Agent. Except as City may specify in writing, Consultant shall have no authority,
express or implied, to act on behalf of City in any capacity whatsoever as an agent. Consultant shall
have no authority, express or implied, pursuant to this Agreement tobind City to any obligation
whatsoever.
Section 7. LEGAL REQUIREMENTS.
7.1 Governing Law. The laws of the State of California shall govern this Agreement.
7.2 Compliance withApplicable Laws. Consultant and any subcontractors shall comply with all laws
applicable to the performanceoftheworkhereunder.
7.3 Other Governmental Regulations. To the extent that this Agreement may be fundedbyfiscal
assistance from another governmental entity, Consultant and anysubcontractors shall complywith
all applicable rules and regulations to whichCity is bound by the terms of such fiscal assistance
program.
Consulting Services Agreement between May 15,2012
City of Dublin and Stevenson Porto& Pierce, Inc. Page 7 of 11
7.4 Licenses and Permits. Consultant represents and warrants to City that Consultant and its
employees, agents, and any subcontractors haveall licenses, permits, qualifications, and approvals
of whatsoever nature that are legally required to practice their respective professions. Consultant
represents and warrants to City thatConsultant and its employees, agents, any subcontractors shall,
at their solecost and expense, keep in effect atall timesduringtheterm of this Agreement any
licenses, permits, and approvals that are legally required to practice their respective professions. In
addition to the foregoing, Consultant and any subcontractors shall obtain and maintainduring the
term of thisAgreement valid Business LicensesfromCity.
7.5 Nondiscrimination and Equal Opportunity. Consultant shall not discriminate, on the basis of a
person's race, religion, color, nationalorigin, age, physical or mental handicap or disability, medical
condition, marital status, sex, or sexualorientation, against any employee, applicant foremployment,
subcontractor, bidder for a subcontract, or participant in, recipient of, or applicant for any services or
programsprovided by Consultant under this Agreement. Consultant shall comply with all applicable
federal, state, and local laws, policies, rules, and requirements related to equal opportunity and
nondiscrimination in employment, contracting, and the provisionof any servicesthat are the subject
of this Agreement, includingbut not limited to thesatisfaction of any positive obligations required of
Consultant thereby.
Consultant shall include the provisions ofthis Subsection in any subcontractapproved by the
Contract Administrator or this Agreement.
Section 8. TERMINATION AND MODIFICATION.
8.1 Termination. City may cancel this Agreement at any time and without cause upon written
notification to Consultant.
Consultant may cancel thisAgreement upon thirty (30) days' written notice to City and shall include
in such notice the reasons for cancellation.
In the event of termination, Consultant shall be entitled to compensation for services performed to
theeffectivedateof termination; City, however, may conditionpayment of such compensation upon
Consultant delivering to City any or all documents, photographs, computer software,video and audio
tapes, and othermaterials provided to Consultant or prepared by or for Consultant or the City in
connection with this Agreement.
8.2 Extension. Citymay, in its sole and exclusive discretion, extendthe end date of this Agreement
beyondthat provided for in Subsection 1.1. Any such extension shall require a written amendment
tothis Agreement, as provided for herein. Consultant understands and agreesthat, if City grants
such an extension, City shall have no obligation to provide Consultant with compensation beyondthe
maximum amount provided for in this Agreement. Similarly, unless authorized by theContract
Administrator, City shall have no obligation to reimburse Consultantfor any otherwise reimbursable
expenses incurred duringthe extension period.
8.3 Amendments. The parties may amend this Agreement only by a writing signed by all the parties.
8.4 Assignment and Subcontracting City and Consultantrecognize and agreethatthis Agreement
contemplates personal performance by Consultant and is basedupon a determination of
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto &Pierce, Inc. Page 8 of 11
Consultant's uniquepersonal competence, experience, and specialized personal knowledge.
Moreover, a substantial inducement to City for entering into this Agreement was and is the
professional reputation and competence ofConsultant. Consultant may notassign this Agreement
or any interest therein without the prior written approval oftheContract Administrator. Consultant
shallnot subcontract any portion of the performance contemplated and provided for herein, other
than to the subcontractors noted in the proposal, without prior writtenapproval of theContract
Administrator.
8.5 Survival. All obligations arising prior tothe termination of thisAgreement and all provisions of this
Agreement allocatingliability between City and Consultant shall survive the termination of this
Agreement.
8.6 Options uponBreach by Consultant. If Consultant materially breaches any of the terms of this
Agreement, City's remedies shallincluded, but not be limited to,thefollowing:
8.6.1 Immediately terminate the Agreement;
8.6.2 Retainthe plans, specifications, drawings, reports, designdocuments, and any other work
productprepared by Consultant pursuant tothis Agreement;
8.6.3 Retain a different consultant to completethe work described in Exhibit A not finished by
Consultant; or
8.6.4 Charge Consultant the difference between thecost to complete the work described in Exhibit
A that is unfinished at the time of breach and the amount that City wouldhave paid
Consultant pursuant to Section 2 if Consultant had completed the work.
Section 9. KEEPING AND STATUS OF RECORDS.
9.1 Records Created as Part of Consultant's Performance. All reports, data, maps, models, charts,
studies, surveys, photographs, memoranda, plans, studies, specifications, records, files, orany other
documents or materials, in electronic or any otherform, thatConsultant preparesor obtains pursuant
to this Agreement and thatrelate to thematters covered hereunder shall be the property of theCity.
Consultant herebyagrees to deliver those documents to the City upon termination of the Agreement.
It is understood and agreed that the documents and other materials, includingbut not limited to
those described above, prepared pursuant to this Agreement areprepared specifically for the City
and are not necessarilysuitablefor any future or other use. City and Consultant agreethat, until
final approval by City, all data, plans, specifications, reports and other documents are confidential
and will not be released to third parties without prior written consent of both parties.
9.2 Consultant's Books and Records. Consultant shall maintain any and all ledgers, books of
account, invoices, vouchers, canceled checks, and other records or documentsevidencing or
relating to charges forservices or expenditures and disbursements chargedto the City under this
Agreementfor a minimum of three (3) years, or for any longer period required by law, from the date
of final payment to the Consultant to this Agreement.
9.3 Inspection and Audit of Records. Any records or documentsthat Section 9.2 ofthis Agreement
requires Consultant tomaintain shall be made available for inspection, audit, and/or copying at any
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto & Pierce, Inc. Page 9 of 11
time during regular business hours, upon oral or writtenrequest of theCity. Under California
Government CodeSection 8546.7, if the amount ofpublic funds expended under this Agreement
exceeds TEN THOUSAND DOLLARS ($10,000.00), the Agreement shall be subject to the
examination and auditof theState Auditor, at the request of City or as part of any audit of the City,
for a period of three(3)years after final payment under the Agreement.
Section 10 MISCELLANEOUS PROVISIONS.
10.1 Attorneys' Fees. If a party to this Agreement brings any action, including an action for declaratory
relief, to enforce or interpret the provision of this Agreement, theprevailing party shall be entitled to
reasonable attorneys' fees in addition to any other relief to which thatparty may be entitled. The
courtmay set such fees in the same action or in a separate action brought for that purpose.
10.2 Venue. In the eventthat either party brings any action against the other underthis Agreement, the
parties agree that trial of such action shall be vested exclusively in thestate courts of California in
the County of Alameda or in the United States District Court for the Northern District of California.
10.3 Severability. If a court of competent jurisdiction finds or rules that anyprovision of this Agreement
is invalid, void, or unenforceable, the provisions of this Agreement not so adjudged shall remain in
full force and effect. The invalidity in whole or in part of any provision of this Agreement shall not
void or affect the validity of any other provisionofthis Agreement.
10.4 No Implied Waiver of Breach. The waiver of any breach of a specific provision of this Agreement
does not constitute a waiver of anyother breach of thatterm or any other termofthis Agreement.
10.5 Successors and Assigns. The provisions of this Agreement shallinure to thebenefit of and shall
apply toandbind the successors and assignsoftheparties.
10.6 Use of Recycled Products. Consultant shall prepare and submit all reports, written studies and
other printed material on recycled paper to the extent it is available at equal or less cost than virgin
paper.
10.7 . Conflict of Interest. Consultant may serve other clients, but none whose activities within the
corporate limits of City or whose business, regardless of location, wouldplace Consultant in a
conflict of interest," as that term is defined in thePolitical Reform Act, codified at California
Government Code Section81000 et seq.
Consultant shall not employ any City official in thework performedpursuant to this Agreement. No
officer or employee of City shall have any financialinterest in this Agreement that would violate
California Government Code Sections 1090 et seq.
Consultanthereby warrants that it is notnow, nor has it been in the previoustwelve (12) months, an
employee, agent, appointee, orofficial of the City. If Consultant was an employee, agent, appointee,
or official of the City in the previoustwelve months, Consultant warrants that it did notparticipate in
any manner in the forming ofthis Agreement. Consultant understands that, if this Agreement is
made in violation of Government Code §1090 et.seq., theentire Agreement is void and Consultant
will not be entitled to any compensation forservices performed pursuant to this Agreement, including
reimbursement of expenses, and Consultant will be required to reimburse the City for any sums paid
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto& Pierce, Inc. Page 10 of 11
10.12 Integration. This Agreement, includingthe scope of workattached hereto and incorporated herein
as Exhibit A, represents the entire and integratedagreement between City and Consultant and
supersedes all prior negotiations, representations, or agreements, either written or oral.
CITY OF DUBLIN CONSULTANT
tat
ni Pattillo, City Manager Michael Porto, Principal
Attest:
CX/l/tN 1. '
Caroline Soto, CityClerk
Approved as to Form:
Bakker, City Attorney
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto & Pierce, Inc. Page 11 of 11
EXHIBIT A
SCOPEOF SERVICES
Provision of Planning, Public Works, and other development services including, but not limited to, environmental,
architectural, landscape architectural, ecological and/or biological consulting services to theCity of Dublinregarding:
o Processing of developmententitlements
o Processing City of Dublinprojects
Said services shall be performed at the direction of the CommunityDevelopment Director on an as-needed basis.
Adjustment of Rates
Hourly rates shall be thoseset forth in Exhibit B (CompensationSchedule).
Consulting Services Agreement between May 15, 2012
City of Dublin and Stevenson Porto& Pierce, Inc. I Exhibit A Page 1 of 1
EXHIBIT B
COMPENSATION SCHEDULE
Cityhereby agrees to pay Consultant a sumnot to exceed 100.00 per hour forwork completed during Fiscal Year 11-
12(July 1, 2011 through June 30, 2012).
Cityhereby agrees to pay Consultant a sumnot to exceed $103.50 per hour for workcommencing Fiscal Year 12-13
July 1, 2012).
Consultant shall not bill for any reimbursableitems.
1854375.1
Consulting Services Agreement between May 15,2012
City of Dublin and Stevenson Porto & Pierce, Inc. I Exhibit B Page 1 of 1
ORIGHI.
DUE FROMPREVIOUSINVOICE(S):
TOTAL DUE TODATE THIS CONTRACT:
$17,687.50
$21,250.00SP21NVOICE NO.00996DATED 07128/2015
$38,937.50
TOTAL AMOUNT DUETHIS INVOICE:
-1\rkCS
\I.._",It1-__._.-.----'
AUG 13 2015
.~'-c!\'ED
-.01 IN
LOCATION HOURS HOURS
FISCALYEAR 201~2016 THJSPERlOD YEAR-TQ.OATE
MICHAEL A PORTO CITY OF DUBLIN 118.50 381.50
ROBERTAJ.BUCHANAN SP2,INC.10.00 84.00
SARAHC.RHEE SP2,INC.13.00 41.50
OTAlS:141.50 507.00
PLANNINGSERVICESPERATIACHEDDETAIL(S)s 17,687.50
PERIOD ENDING:08/07/2015
:08/1112015
:96002
:VARIOUSPLANNINGPROJECTS
DUBLIN,CALIFORNIA
cAv~aLE UPON R!:C'E.::lT
INVOICEDATE
JOB NO.
LOCATION
CITYOFDUBLIN
ATIN:PLANNINGDEPARTMENT
100 CIVICPLAZA
DUBLIN,CALIFORNIA94568
STEVENSON,PORTO &PIERCE,INC.5519A YONAVENUE.IRWINDALE.CAUFORNIA 91706--2057
CIVILENGINEERS.LANDPLANNERS.LANDSURVEYORS&ENVIRONMENTALPLANNERS T:626.385.3980
F:626.385.3983
INVOICE NO.00997