HomeMy WebLinkAboutCC Resolution 13108 (Auditing Services; Maze & Associates)RESOLUTION NO. 13108
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN
RAFAEL APPROVING AND AUTHORIZING THE INTERIM CITY
MANAGER TO EXECUTE AN AMENDMENT TO THE AGREEMENT
FOR PROFESSIONAL AUDITING SERVICES BETWEEN THE CITY
AND MAZE AND ASSOCIATES, EXTENDING THE TERM OF THE
AGREEMENT FOR THE FISCAL YEARS ENDING JUNE 30, 2011 AND
JUNE 30, 2012, RESPECTIVELY.
The City Council of the City of San Rafael hereby resolves as follows:
The City Council approves and hereby authorizes the Interim City Manager to
execute an amendment to the Agreement for Professional Auditing Services, dated
March 5, 2007, with Maze and Associates, extending the term of the Agreement for the
fiscal years ending June 30, 2011 and June 30, 2012, respectively, in the form attached
hereto.
I, ESTHER C. BEIRNE, Clerk of the City of San Rafael, hereby certify that the
foregoing resolution was duly and regularly introduced and adopted at a regular meeting
of the City Council of said City held on Tuesday, the 22nd day of February, 2011, by the
following vote, to wit:
AYES: COUNCILMEMBERS: Brockbank, Connolly, Heller, Levine & Mayor Boro
NOES: COUNCILMEMBERS: None
ABSENT: COUNCILMEMBERS: None
2 C'2"-� .
ESTHER C. BEIRNE, City Clerk
8';166
AMENDMENT TO AGREEMENT
FOR PROFESSIONAL AUDITING SERVICES
This Amendment to Agreement is made and entered into this day of r`r3 , 2011,
by and between the CITY OF SAN RAFAEL (hereinafter "CITY"), and MAZE AND
ASSOCIATES (hereinafter "CONTRACTOR").
RECITALS
WHEREAS, the CITY and the CONTRACTOR entered into an Agreement dated March
5, 2007, by which CONTRACTOR agreed to provide CITY with professional auditing services;
and
WHEREAS, the CITY and CONTRACTOR wish to enter into an Amendment to the
Agreement to extend the term of that Agreement.
AGREEMENT
NOW, THEREFORE, the parties hereby agree as follows:
1. Paragraph 5 is amended to read as follows:
"The term of this Agreement shall be for six consecutive years for the fiscal years
ending June 30, 2007 through June 30, 2012.
2. All other covenants, terms and conditions of the Agreement shall remain
unchanged and in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day, month
and year first above written.
CITY OF SAN RAFAEL
JkS�huttz, Interi Ci Manager
CONTRACTOR
BY'
Name: y p n
Title: P.�' (lnR. `�t�-�L _ l% [ o mt-on
1
ATTEST:
xz,4 , e- r tae a ,.2
ESTHER C. BEIRNE, City Clerk
APPROVED AS TO FORM:
ROBERT F. EPSTEN, City Attorney
AGREEMENT
FOR: Professional Auditing Services
This Agreement is made and entered into this 5th day of March. 2007, by and between
the CITY OF SAN RAFAEL (hereinafter "CITY"), and Maze and Associates ("Maze") hereinafter
("CONTRACTOR").
PROJECT COORDINATION
A. CITY. The City Manager shall be the representative of the CITY for all
purposes under this Agreement. The Finance Director, Cindy Mosser, 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. Katherine Yuen, Shareholder, 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
the Request for Proposal for Audit Services
CONTRACTOR'S Proposal dated February 2,
herein.
3. DUTIES OF CITY
duties and/or provide services as described in
(attached Exhibit A) and pursuant to the
2007 (attached Exhibit B) and incorporated
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 pursuant to the Schedule of Fees and Expenses reflected in the
CONTRACTOR'S Pricing Proposal (attached Exhibit C), dated February 2, 2007, including the
cost of local business license taxes.
Payment will be made monthly upon receipt by PROJECT MANAGER of itemized
invoices submitted by CONTRACTOR.
5. TERM OF AGREEMENT
The term of this Agreement shall be for four consecutive years for auditing fiscal
years ending June 30, 2007 through June 30, 2010. Upon mutual agreement of the parties, and
subject to the approval of the City Council, the term of this Agreement shall be extended for an
additional period of two years for auditing fiscal years ending June 30, 2011 and June 30, 2012.
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 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.
2
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
3
placement coinciding with the effective date of this Agreement;
8. PROJECT MANAGER and the City Attorney shall approve the
insurance as to form and sufficiency.
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, judgment, 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, 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
R
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 Rafael Municipal Code. CONTRACTOR shall pay
any and all state and federal taxes and any other applicable taxes. CONTRACTOR's taxpayer
identification number is 94-2590179, 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 1147
r ( /
ATTEST:
CWj Clerk
APPROVED
City
FORM:
CONTRACTOR
V
Name: 1-6-
uAtor, 2 Yk en
Title: �,� we hol t�
MManagement services- WorkFile\Finance- WorkFile\Agreement and Contracts\Professional Contracts12007\Maze Audit
services agreement.doc
7
EXHIBIT C
PRICING PROPOSAL
Portion of Our Proposal
To Provide Professional Auditing Services
for the
CITY OF SAN RAFAEL
Submitted By
MAZE & ASSOCIATES
3478 Buskirk Avenue, Suite 215
Pleasant Hill, CA 94523
(925) 930-0902
Contact Persons
Cory Biggs — e-mail address —corvb(@mazeassociates.com
Katherine Yuen — e-mail address—katherinev(@mazeassociates.com
February 2, 2007
G
Li -I
u
3,
i
I~
PRICING PROPOSAL
Certification
Cory Biggs and Katherine Yuen are authorized to submit this proposal and negotiate and sign a contract
with the City of San Rafael. Our offer is firm and irrevocable for a period of 90 days from the date of
this proposal.
Total Cost of Audit
Our Estimated All-inclusive Maximum Prices for the services specified in the Request Form Proposal for
the fiscal years ending June 30, 2007 through 2012, are detailed at the end of this section. Our Total All-
inclusive Maximum Prices for the services specified in the RFP are firm fixed fees.
Our policy is to attempt to keep our clients fees constant after inflation. Therefore, the fees for years
subsequent to 2007 have been adjusted for the estimated 2006 CPI increase for the Services Sector of the
U.S. Department of Labor, Bureau of Labor Statistics for the San Francisco -Oakland Area.
What Our Price Includes
Our price includes all the basic audit work and reports, statements and other deliverables specified in
your request for proposal. Our price also includes the items below at no additional cost:
1) year-round support and telephone consultation on pertinent issues affecting your City,
2) copies of our journal entries and our leadsheets used to support the amounts in your financial
statements,
3) a Study Session for the Council to discuss the audit process, financial statements and
recommendations,
4) periodic Client Alert letters, but only when needed,
5) active on-site Partner involvement in your work every year,
6) our typed Interim Audit Checklist,
7) our typed Annual Closing Checklist,
8) our typed interim Accounting Issues Memorandum,
9) preliminary proforma financial statement formats at interim,
10) answers to most municipal payroll tax questions,
11) reference library of California CAFR award -winners.
12) GASB 34 consolidation, major fund determination, reconciliations,
13) Pivot table analysis tools for the current and prior years
14) Rotating Areas of Special Emphasis
Additional Services
Any additional services will be performed and billed only on the City's prior authorization at our
standard billing rates.
e
PRICING PROPOSAL (Continued)
Fees and Billings
Our fees are firm fixed prices. In determining our fees, we understand that the City's records will be in
condition to be audited; that is, transactions will be properly recorded in the general ledger and subsidiary
records, these accounting records and the original source documents will be readily available to use, we will
be furnished with copies of bank reconciliations and other reconciliations and analyses prepared by the City
and City personnel will be reasonably available to explain procedures, prepare audit correspondence and
obtain files and records.
We do not post separate rate structures for municipal audit work. We view this work as being every
bit as important and valuable as the work we perform for other clients and we put our best people on
it. Any consulting work you request will be performed at the same rates as our audit work.
Cost Rationale
We are quite confident we will complete the work in the time budgeted. But we thought you should know
the rationale we used to arrive at our budget. You should know that we fmish what we start, regardless of
the accuracy of our budgets.
Since municipal auditing is our principal business, we have no need to assign staff and add hours simply
because our people are available and need experience, as is the case with most funis. At the same time, we
do not need to discount our work, since we do not need to offset the inefficiencies of inexperienced staff
people. And we keep the City's "hidden costs"—time spent with auditors—to a minimum.
We do more work in less time because our people are much better trained and we use a much more efficient
audit approach. All our people receive two or three times as much training as their contemporaries in other
firms. This training is very intense, very inter -active, very practical and is nearly 100% municipal audit
related. Since nearly all our work is municipal audit, our people average 1,500 hours of municipal
experience annually as they quickly gain experience to match their training, which makes them much more
efficient at municipal auditing than their contemporaries. Not only do they understand your problems, they
have seen how your peers are solving them.
Since so much of our practice is fixed-price municipal work, we have been under constant pressure for years
to increase our efficiency without simply shifting work to clients. We have responded with some real
L innovations. Performing our Analytical Review of financial statements before we begin our year-end audit
forces the Partners to get actively involved early and give Directors, Supervisors and Associates the
direction they need. Computerizing the entire financial statement and trial balance preparation cut out a
di huge number of hours while it increased accuracy, as did the mini -networks of computers and printers we
bring to your office. Our Closing Checklist forces us and our clients to plan the year-end and identify
closing problems at interim, months in advance. And our heavy emphasis on accomplishing major segments
of the work at interim brings audit problems to light much earlier and takes much of the pressure off your
staff at year end.
I
f Basically, we have disproved the assumption that the quality of the audit is a direct function of the
L number of hours expended. Instead we have proved there are much more efficient ways to audit and we
have used much of those time savings to increase the thoroughness and depth of the audit.
U
CITY OF SAN RAFAEL
SCHEDULE OF PROFESSIONAL FEES AND EXPENSES
FOR THE AUDITS OF THE FINANCIAL STATEMENTS FOR THE YEARS ENDED JUNE 30:
Hourly
Totals (2)
Hours (3) Rates 2007 2008
2009
2010
2011
2012
Comprehensive Annual Financial Report
& Management Letter.
Partners
46.00 $275 $12,650 $13,093
$13,551
$14,025
$14,516
$15,024
Supervisor
$7.00 110 9,570 9,905
10,252
10,611
10,982
11,366
Associates
174.00 85 14,790 17,985
15,937
16,495
17,072
17,670
Office
17.00 75 1,275 1,320
1,366
1,414
1,463
1,514
Total Comprehensive Annual Financial Report
324.00 38,285 42,303
41,106
42,545
44,033
45,574
Additional Reports:
Redevelopment Agency
45.00 4,555 4,715
4,880
5,051
5,228
5,410
Single Audit (I Program)
55.00 5,335 5,522
5,715
5,915
6,122
6,337
Child Development Program Report
47.00 4,675 4,839
5,009
5,184
5,366
5,554
Gann Limit Agreed Upon Procedures
9.25 1,039 1,076
1,113
1,152
1,192
1,233
Out-of-pocket expenses (1)
Total firm fixed fees
480.25 $53,889 $58,455
$57,823
$59,847
$61,941
$64,108
Schedule of Hourly Rates by Position By Year
Rates per Hora(4)
Position
2007 2008
2009
2010
2011
2012
Pers
$275 $289
$303
5318
$334
$351
IT Manager.
$130 $137
$144
$151
$159
$167
ry
Supervisor
$110 $116
$122
$128
$134
$141
d
Associates
$85 $89
$93
$98
$103
$108
Office
$75 $79
$83
$87
$91
$96
NOTES:
(1) Out-of-pocket expenses are included in our standard hourly rate.
(2) Our policy is to attempt to keep our clients fees constant after inflation. Therefore, the fees for years subsequent
to 2007 have been adjusted for the estimated
2006 CPI increase of 3.5% for the Services Sector of the U.S. Department of Labor,
Bureau of Labor Statistics for the San Francisco -Oakland Area. The resulting data aro firm fixed fees.
(3) Estimated hours are expected to remain constant, except for 2008, which includes $2,677 in GASB 45 implementation costs.
(4) Rates are annually adjusted for a 5% cost of living adjustment
a