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HomeMy WebLinkAboutCC Resolution 9780 (Refuse Rate Review; HF&H)RESOLUTION NO. 9780 A RESOLUTION AUTHORIZING THE SIGNING OF AN AGREEMENT WITH HILTON, FARNKOPF & HOBSON, LLC FOR REFUSE RATE REVIEW FOR THE 1997/98 FISCAL YEAR THE CITY COUNCIL OF THE CITY OF SAN RAFAEL RESOLVES as follows: The CITY MANAGER and CITY CLERK are authorized to execute, on behalf of the City of San Rafael, an agreement with Hilton, Farnkopf & Hobson, LLC for Refuse Rate Review for the 1997/98 fiscal year a copy of which is hereby attached and by this reference made a part hereof. I, JEANNE M. LEONCINI, Clerk of the City of San Rafael, hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a reaular meeting of the City Council of said City held on Tuesdav the 21st day of January , 19 97 , by the following vote, to wit: AYES: COUNCILMEMBERS: Heller, Miller, Phillips & Vice -Mayor Cohen NOES: COUNCILMEMBERS: None ABSENT: COUNCILMEMBERS: Mayor Boro JEANWEiK.LEONCINI, City Clerk ��IGI�AIPexe° AGREEMENT FOR Review of Marin Sanitary Service's 1977 Rate Application This Agreement is made and entered into this 21st day of JANUARY , 1997 , by and between the CITY OF SAN RAFAEL (hereinafter "CITY"), and Hilton Farnkopf and Hobson. LLC hereinafter "CONTRACTOR"). 1. PROJECT COORDINATION A. CITY. The City Manager shall be the representative of the CITY for all purposes under this Agreement. The Director of Administrative Services, Ken Nordhoff is hereby designated the PROJECT MANAGER for the CITY, and said PROJECT MANAGER shall supervise all aspects of the progress and execution of this Agreement. B. CONTRACTOR. CONTRACTOR shall assign a single PROJECT DIRECTOR to have overall responsibility for the progress and execution of this Agreement for CONTRACTOR. Robert D. Hilton is, hereby designated as the PROJECT DIRECTOR for CONTRACTOR. Should circumstances or conditions subsequent to the execution of this Agreement require a substitute PROJECT DIRECTOR for any reason, the CONTRACTOR shall notify the CITY within ten (10) business days of the substitution. 2. DUTIES OF CONTRACTOR CONTRACTOR shall perform the duties and/or provide services as described in Exhibit " A " attached and incorporated herein. 3. DUTIES OF CITY CITY shall cooperate with CONTRACTOR in his performance under this agreement and shall compensate CONTRACTOR as provided herein. 4. COMPENSATION For the full performance of the services described herein by CONTRACTOR, CITY shall pay CONTRACTOR an amount NOT to exceed $18,500.00 plus the cost of local business license taxes as described in Section 20. Payment will be made monthly upon receipt by PROJECT MANAGER of itemized invoices submitted by CONTRACTOR. 01 COPY 5. TERM OF AGREEMENT The term of this Agreement shall commence upon the date of execution of this agreement and shall end on June 30, 1997. 6. TERMINATION A. Discretionary. Either party may terminate this Agreement without cause upon thirty (30) days written notice mailed or personally delivered to the other party. B. Cause. Either party may terminate this Agreement for cause upon ten (10) days written notice mailed or personally delivered to the other party, and the notified party's failure to cure or correct the cause of the termination notice, to the reasonable satisfaction of the party giving such notice, within thirty (30) days of the receipt of said notice. C. Effect of Termination. Upon receipt of notice of termination, neither party shall incur additional obligations under any provision of this Agreement without the prior written consent of the other. D. Return of Documents. Upon termination, any and all CITY documents or materials provided to CONTRACTOR and any and all of CONTRACTOR's documents described in paragraph 7 below, shall be delivered to CITY as soon as possible, but not later than thirty (30) days after termination. 7. OWNERSHIP OF DOCUMENTS The written documents and materials prepared by the CONTRACTOR in connection with the performance of its duties under this Agreement, shall be the sole property of CITY. CITY may use said property for any purpose, including projects not contemplated by this Agreement. 8. INSPECTION AND AUDIT Upon reasonable notice, CONTRACTOR shall make available to CITY, or its agent, for inspection and audit, all documents directly related to CONTRACTOR'S performance of its duties under this Agreement. CONTRACTOR shall fully cooperate with CITY or its agent in any such audit or inspection. 9. ASSIGNABILITY The parties agree that they shall not assign or transfer any interest in this Agreement nor the performance of any of their respective obligations hereunder, without the prior written consent E of the other party, and any attempt to so assign this Agreement or any rights, duties or obligations arising hereunder shall be void and of no effect. 10. INSURANCE A. During the term of this Agreement, CONTRACTOR shall maintain, at no expense to CITY, the following insurance policies: 1. A comprehensive general liability insurance policy in the minimum amount of one million ($1,000,000) dollars per occurrence for death, bodily injury, personal injury, or property damage; 2. An automobile liability (owned, non -owned, and hired vehicles) insurance policy in the minimum amount of one million ($1,000,000) dollars per occurrence; 3. If any licensed professional performs any of the services required to be performed under this Agreement, a professional liability insurance policy in the minimum amount of one million $1,000,000) dollars to cover any claims arising out of the CONTRACTOR's performance of services under this Agreement. B. The insurance coverage required of the CONTRACTOR by section 11. A., shall also meet the following requirements: 1. The insurance shall be primary with respect to any insurance or coverage maintained by CITY and shall not call upon CITY's insurance or coverage for any contribution; 2. Except for professional liability insurance, the insurance policies shall be endorsed for contractual liability and personal injury; 3. Except for professional liability insurance, the insurance policies shall be specifically endorsed to include the CITY, and other entities in the Franchisors' Group, their officers, agents, employees and volunteers as additionally named insureds under the policies; 4. CONTRACTOR shall provide to PROJECT MANAGER, (a) Certificates of Insurance evidencing the insurance coverage required herein, and (b) specific endorsements naming CITY, and other entities in the Franchisors' Group, their officers, agents, employees and volunteers as additional insureds under the policies; 5. The insurance policies shall provide that the insurance carrier shall not cancel, terminate or otherwise modify the terms and conditions of said insurance policies except upon thirty (30) days written notice to CITY's PROJECT MANAGER; 6. If, the insurance is written on a Claims Made Form, then, following termination of this Agreement, said insurance coverage shall survive for a period of not less than five years; 7. The insurance policies shall provide for a retroactive date of placement coinciding with the effective date of this Agreement; 8. The insurance shall be approved as to form and sufficiency by PROJECT MANAGER and the City Attorney. C. If it employs any person, CONTRACTOR shall maintain worker's compensation and employer's liability insurance, as required by the State Labor Code and other applicable laws and regulations, and as necessary to protect both CONTRACTOR and CITY against all liability for injuries to CONTRACTOR's officers and employees. D. Any deductibles or self-insured retentions in CONTRACTOR's insurance policies must be declared to and approved by the PROJECT MANAGER and the City Attorney. At CITY's option, the deductibles or self-insured retentions with respect to CITY shall be reduced or eliminated to CITY's satisfaction, or CONTRACTOR shall procure a bond guaranteeing payment of losses and related investigations, claims administration, attorney's fees and defense expenses. 11. INDEMNIFICATION CONTRACTOR shall indemnify, release, defend and hold harmless CITY, and other entities in the Franchisors' Group, their officers, agents, employees and volunteers, against any claim, demand, suit, judgement, loss, liability or expense of any kind, including attorney's fees, arising out of or resulting in any way, in whole or in part, from any acts or omissions, intentional or negligent, of CONTRACTOR or CONTRACTOR's officers, agents and employees in the performance of their duties and obligations under this Agreement. 12. NONDISCRIMINATION CONTRACTOR shall not discriminate, in any way, against any person on the basis of age, sex, race, color, religion, ancestry, national origin or disability in connection with or related to the performance of its duties and obligations under this Agreement. 13. COMPLIANCE WITH ALL LAWS CONTRACTOR shall observe and comply with all applicable federal, state and local laws, ordinances, codes and regulations, 4 in the performance of its duties and obligations under this Agreement. CONTRACTOR shall perform all services under this Agreement in accordance with these laws, ordinances, codes and regulations. CONTRACTOR shall release, defend, indemnify and hold harmless CITY, and other entities in the Franchisors' Group, their officers, agents and employees from any and all damages, liabilities, penalties, fines and all other consequences from any noncompliance or violation of any laws, ordinances, codes or regulations. 14. NO THIRD PARTY BENEFICIARIES CITY and CONTRACTOR do not intend, by any provision of this Agreement, to create in any third party, any benefit or right owed by one party, under the terms and conditions of this Agreement, to the other party. 15. NOTICES All notices and other communications required or permitted to be given under this Agreement, including any notice of change of address, shall be in writing and given by personal delivery, or deposited with the United States Postal Service, postage prepaid, addressed to the parties intended to be notified. Notice shall be deemed given as of the date of personal delivery, or if mailed, upon the date of deposit with the United States Postal Service. Notice shall be given as follows: TO CITY: Mr. Kenneth A. Nordhoff Director of Administrative Services (Project Manager) City of San Rafael 1400 Fifth Avenue P.O. Box 151560 San Rafael CA 94915-1560 TO CONTRACTOR: Mr. Robert D. Hilton, CMC (Project Director) Hilton Farnkopf and Hobson, LLC 2201 Walnut Avenue Suite 280 Fremont CA 94538-2334 16. INDEPENDENT CONTRACTOR For the purposes, and for the duration, of this Agreement, CONTRACTOR, its officers, agents and employees shall act in the capacity of an Independent Contractor, and not as employees of the CITY. CONTRACTOR and CITY expressly intend and agree that the status of CONTRACTOR, its officers, agents and employees be that of an Independent Contractor and not that of an employee of CITY. 5 17. ENTIRE AGREEMENT -- AMENDMENTS A. The terms and conditions of this Agreement, all exhibits attached, and all documents expressly incorporated by reference, represent the entire Agreement of the parties with respect to the subject matter of this Agreement. B. This written Agreement shall supersede any and all prior agreements, oral or written, regarding the subject matter between the CONTRACTOR and the CITY. C. No other agreement, promise or statement, written or oral, relating to the subject matter of this Agreement, shall be valid or binding, except by way of a written amendment to this Agreement. D. The terms and conditions of this Agreement shall not be altered or modified except by a written amendment to this Agreement signed by the CONTRACTOR and the CITY. E. If any conflicts arise between the terms and conditions of this Agreement, and the terms and conditions of the attached exhibits or the documents expressly incorporated by reference, the terms and conditions of this Agreement shall control. 18. WAIVERS The waiver by either party of any breach or violation of any term, covenant or condition of this Agreement, or of any ordinance law or regulation, shall not be deemed to be a waiver of any other term, covenant, condition, ordinance, law or regulation, or of any subsequent breach or violation of the same or other term, covenant, condition, ordinance, law or regulation. The subsequent acceptance by either party of any fee, performance, or other consideration which may become due or owing under this Agreement, shall not be deemed to be a waiver of any preceding breach or violation by the other party of any term, condition, covenant of this Agreement or any applicable law, ordinance or regulation. 19. COSTS AND ATTORNEY'S FEES The prevailing party in any action brought to enforce the terms and conditions of this Agreement, or arising out of the performance of this Agreement, may recover its reasonable costs (including claims administration) and attorney's fees expended in connection with such action. 20. CITY BUSINESS LICENSE/OTHER TAXES CONTRACTOR shall obtain and maintain during the duration of this Agreement, a CITY business license as required by the San 9 Rafael Municipal Code. CONTRACTOR shall pay any and all state and federal taxes and any other applicable taxes. CONTRACTOR's taxpayer identification number is 94-3097242 , and CONTRACTOR certifies under penalty of perjury that said taxpayer identification number is correct. 21. APPLICABLE LAW The laws of the State of California shall govern this Agreement. IN WITNESS WHEREOF, the parties have executed this Agreement as of the day, month and year first above written. CITY OF SAN RAFAEL City Manager Rod Gould ATTEST: M� C' y rk CleJe M. Leoncini City AttorAy Gary �. Ragghianti FA CONTRACTOR HILTON F_ARRNNK,✓OPF AND ROBS N, /ILLC By: `/-� <LG C-C-LIQ//�! K ' ,C_ L Name: A. nA*, : 4 'Z /'Z' Title: Exhibit A HILTON FARNKOPF & HOBSON _ Advisory Services to =E _Municipal Management 2201 Walnut Avenue, Suite 280 Fremont, California 94538-2334 Telephone: 510/713-3270 Fax: 510/713-3294 December 2, 1996 Mr. Kenneth A. Nordhoff Director of Administrative Services City of San Rafael 1400 Fifth Avenue P.O. Box 151560 San Rafael, CA 94915-1560 Copy by facsimile: Orig nal by mail Re: Proposal to Perform a Review of Marin Sanitary Service's 1997 Rate Application Dear Mr. Nordhoff: Fremont Newport Beach In response to Mr. Ongaro's request of October 24, 1996, and subsequent discussions with the Franchisors' Group on November 19, 1996, Hilton Farnkopf & Hobson, LLC is pleased to present this proposal to perform a review of Marin Sanitary Service's (MSS) application for rates to be effective July 1, 1997. Background In 1995, the Franchisors adopted a new methodology that would be used to set MSS' refuse collection and disposal as well as recyclable collection and processing rates. The methodology alternates detailed reviews with summary reviews (based largely on the detailed review, the use of indices and the review of a few key matters such as revenues and disposal costs). In 1995 the last detailed review was performed and in 1996 the abbreviated review was conducted for the first time. The abbreviated review procedures will be used again in 1997. Scove of Work and Schedule We will perform the following tasks related to the review of MSS' Application. The schedule for the performance of these tasks is presented in parentheses and refers to the week beginning on the date indicated. recycled 0 Paper Mr. Kenneth A. Nordhoff December 2, 1996 Page 2 Task 1: Determination of Index Values (March 3, 1997) For each index used for adjusting costs, we will obtain and document the most recent value and the index's value 12 months ago. We will provide these results to MSS for their review and comment. We will meet once with MSS management to discuss these values and any differences between their calculations and ours. Task 2: Pre -Fieldwork (March 10, 1997) 2.1 We will meet with MSS management to receive the application and discuss the review schedule. 2.2 Thereafter, we will review the application to ensure that it is complete and in compliance with the methodology. Task 3: Review of Revenues (March 10 to March 31, 1997) HF&H will review MSS management's projection of collection and non -collection revenues for the 12 -month periods beginning July 1, 1996 and 1997. We will compare the results to MSS' audited financial statements for rate year 1995 and request explanations for variances. Task 4: Review of Expenses (March 10 to March 31, 1997) We will review the appropriateness of MSS management's classification of expenses into the various expense categories. We will review MSS management's calculation of rate year 1997 expense. Depreciation/ Lease Expense and Interest Expense projections will be reviewed by evaluating the reasonableness of MSS management's estimates for these expenses based on historical expenses and management's plans. Task 5: Review of Projected Profit (March 31, 1997) HF&H will review MSS management's calculation of projected profit for compliance with the procedures and mathematical accuracy. Task 6: Review of Rate Adjustments (March 31, 1997) We will review MSS management's calculation of adjustments to the current rate revenues, giving effect to any adjustments identified through performance of the procedures described above. HILTON FARNKOPF & HOBSON, LLC =E.E Mr. Kenneth A. Nordhoff December 2, 1996 Page 3 Task 7: Communicate Findings (April 7 to April 21, 1997) HF&H will meet once with MSS management to present and obtain its comments regarding our findings and recommendations. We will make any appropriate adjustments to our preliminary findings and recommendations. Task 8: Engagement Management We will prepare and amend detailed workplans, monitor engagement progress, and provide sufficient resources to ensure timely completion of the engagement, review analytical results and interim findings, review the draft and final reports, and respond to questions regarding the progress of the engagement and other issues. Limitation: Every approach to an engagement is limited in its scope. The major limitations regarding our proposed scope of work are: • The scope of work described above is different than an audit of financial statements performed in accordance with Generally Accepted Auditing Standards, which is performed by MSS' auditor. The tasks presented above will be performed in a manner that will allow us to achieve the objectives of the review in a cost effective manner. We will rely on MSS' auditor with regard to matters related to MSS' internal controls. Our testing of judgmental samples of transaction and analytical procedures, used in the Detailed Rate Review but not in the Rate Index Methodology, will only be for the purpose of providing evidence which supports our findings and recommendations regarding MSS' application. Our Review will be conducted in accordance with the Rate Index Methodology adopted by the Franchisors' Group. This methodology includes the review of MSS management's projection of the future results of operations. We will review these projections for reasonableness and propose adjustments as appropriate. We accept no responsibility to update these adjusted projected results after the date of our report. Additionally, the projections result from assumptions regarding future events and management's planned response to them. Frequently, future events do not occur as anticipated and the difference can be material. HILTON FARNKOPF Sc HOBSON, LLC =E=� Mr. Kenneth A. Nordhoff December 2, 1996 Page 4 • The performance of our review in accordance with the schedule described above is dependent on: — The ability of MSS management to prepare its application and respond to questions in a timely manner; and, — The ability of the Franchisors to provide necessary direction and comments to draft work products in a timely manner. We anticipate that neither MSS management nor the Franchisors will have difficulty performing in the manner we have assumed. • The passage of Proposition 218 may require modifications to this scope of work. If so, we would be pleased to discuss modifying our scope of work with the Franchisors' Group. We have neither included in the scope of our work modifications to any of the individual Franchisors' rates nor rate structures. If any of the Franchisors would like us to perform these functions, we would be pleased to discuss the matter with them. We have also not included in the scope of our work presentations to the Franchisors' governing bodies. However, we would be pleased to do so based on arrangements made with the requesting Franchisor. Staffing I will be responsible for directing the project and will perform all sub -tasks related to the project management task described above, as well as attending all meetings with the Franchisors and key meetings with MSS' management. I will be assisted by less senior experienced staff at lower billing rates who will perform certain tasks under my direction. Fee Based on our last Rate Index Methodology, I estimate our professional fees for this scope of work to be $17,000. Our out-of-pocket expenses should not exceed $1,500. Therefore, we propose to perform this scope of work for a not -to -exceed fee of $18,500. HILTON FARNKOPF & HOBSON, LLC HFFI Mr. Kenneth A. Nordhoff December 2, 1996 Page 5 As in the past, we will bill you in accordance with our standard rates and practices as described in Attachment A. Thank you for this opportunity to again be of service to you. If you have any questions, please call me at 510/713-3272. Very truly yours, HILTON FARNKOPF HOBSON, LLC Robert D. Hilton, CMC President Attachment A: Standard Billing Rates and Practices Copies to: Ms. Jean Bonander City Manager City of Larkspur 420 Magnolia Ave. Larkspur, CA 94939 Ms. Dee Johnson Manager Special Projects County of Marin 10 North San Pedro Rd. #1022 San Rafael, CA 94903 Mr. Ned Ongaro District Manager Ross Valley Sanitary District 2000 Larkspur Landing Circle Larkspur, CA 94939 Mr. Rabi Elias Public Works Director Town of Ross P.O. Box 320 Ross, CA 94957 Ms. Nadine A. Muller Chief Financial Officer Marin Sanitary Service 1050 Andersen Drive San Rafael, CA 94901 Mr. Peter Vine District Manager Las Gallinas Sanitary District 300 Smith Ranch Road San Rafael, CA 94903 HILTON FARNKOPF & HOBSON, LLC = E Attachment A HILTON FARNKOPF & HOBSON, LLC BILLING RATE SCHEDULE AND STANDARD TERMS Professional Fees Hourly rates for professional and administrative personnel are as follows: Position President Senior Vice President Vice President Senior Associate Associate Assistant Administrative Staff Direct ExvenseS. Standard charges for common direct expenses are as follows: Automobile Travel Document Reproduction (over 25 pages per run) Facsimile Telephone Public Conveyances Postage Overnight Mail and Couriers Updated 8/26/% Rate $200 $165-$180 $155 $110-$135 $90-$100 $65-$85 $45 $0.31 /mile $0.15/page No charge No charge Actual Actual Actual HILTON FARNKOPF & HOBSON, LLC =E_E Billing Policies Our policy is to bill for our services and direct expenses based on the standard hourly rates of the staff member assigned, multiplied by the time required to perform the client -related tasks, plus the subcontractor services as described above. In implementing this policy we adhere to the following practices: • We round to the nearest one-half hour (e.g., if two hours and 50 minutes are spent on a task, it is recorded as three hours, if two hours and 10 minutes are spent on a task, it is recorded as two hours). A minimum charge of one-half hour is charged for any client work performed in a day. We attempt to schedule travel time before and after normal work hours and we do not bill for this time. If travel occurs during normal work hours and we can use public conveyances, we attempt to use the time productively for the benefit of the client or for another client�and this time is billed to the appropriate client. If we must travel during business hours and cannot use the time productively or use a public conveyance, we bill the time to the client on whose behalf we are traveling. • Because public meetings (e.g., Board of Supervisors', City Council, and Board of Directors' meetings) generally occur after business hours and are not conducted in accordance with strict schedules, our standard policy is to bill a minimum two-hour charge. • We do not mark up out-of-pocket expenses, however, we may charge administrative or professional time related to the provision of the goods and services associated with these charges. Costs for outside consultants and subcontractors are billed at actual cost plus a 15 percent administrative fee. • Mileage fees are based on the round-trip distance from the point of origin. • If a client's change to a previously scheduled meeting results in penalties being assessed by a third party (e.g., airline cancellation fee), then the client will bear the cost of these penalties. While no minimum fee for a consulting engagement has been established, it is unlikely (given the nature of our services) that we can gain an understanding of a client's particular requirement, identify alternatives, and recommend a solution in less than twenty-four hours. Updated 8/26/96 Oft HILTON FARNKOPF & HOBSON, LLC —E—E Insurance We maintain the following policies of insurance with carriers doing business in California: • Comprehensive General Liability Insurance ($1,000,000) • Workers Compensation ($1,000,000) • Professional Liability Insurance ($1,000,000) All costs incurred in complying with special insurance, licensing, or permit requirements, including but not limited to naming client as an additional insured and waiver of subrogation, become the responsibility of the client and are not included in the fees for services or direct charges but are billed in addition to the contract at cost, plus any professional or administrative fees. Invoices and Payment for Services Our time reporting and billing system has certain standard formats that are designed to provide our clients with a detailed invoice of the time and charges associated with their engagement. (We typically discuss these with our clients at our kick-off meeting.) We are also pleased to provide our clients with a custom invoice format but we will have to bill the client for any additional costs associated with their unique requirements. Billings for professional services and charges are submitted every two weeks, in order that our clients can more closely monitor our services. Alternatively, if a project is of substantial duration, we will arrange to bill on a monthly basis, if the client prefers. In either case, a late fee of one and one-half percent per month is applied to balances unpaid after thirty (30) days. Updated 8/26i96 HILTON FARNKOPF & HOBSON, LLC � -