16-1115_NBS GOVERNMENT FINANCE GROUP_D11_Agenda ReportTO :
FROM :
SUBMITTED BY:
DATE:
SUBJECT:
City of San Juan Capistrano
Agenda Report
Honorable Mayor and Members of the City Council
.:??fen Siegel, City Manager
Ken Al-lmam, Chief Financial Officer '
November 15, 2016
11/15/2016
011
Consideration of an Amendment to the Personal Services
Agreement with NBS Government Finance Group to Update and
Complete the City's User Fee Study and Cost Allocation Plan; and
Appropriation of Funds
RECOMMENDATION:
By motion,
1. Approve and authorize the City Manager to execute an amendment to the City's
agreement with NBS Government Finance Group to update and complete the City's
userfee study and cost allocation plan; and,
2. Appropriate $27,200 from the General Fund to provide the funds needed to
complete the user fee study.
EXECUTIVE SUMMARY:
In 2012, the City initiated a comprehensive city-wide user fee study. This study was not
completed and is currently in draft form. Consequently, it no longer reflects the cost of
City operations. An amendment to the consultant agreement is needed to update and
complete the study so that it reflects the current cost of City operations.
DISCUSSION/ANALYSIS :
An up-to-date user fee study is critical to ensure that the City is properly recovering all
relevant costs in the establishment of its fees for services. Failure to do so can lead to a
deterioration of the City's financial condition which limits the ability of the City to provide
City Council Agenda Report
November 15, 2016
Page 2 of 3
critically needed services for the community. In addition, state law requires that there be
a proper nexus between the fees that are charged for City services and the cost of
those services. A fee structure that is not based on the current cost of operations
exposes the City to risk of challenge as to whether the required nexus between the fee
structure and current operating results is still intact.
It should be noted that while certain user fees and charges were adjusted on an annual
basis prior to 2012, the fees currently used by the City are not based on a
comprehensive city-wide user fee study. It is generally recommended that a
comprehensive user fee study be performed every five years to support an agency's
fees and rates.
The user fee study that was initiated in 2012 is currently in draft form and has not been
finalized. In addition, the 2012 user fee study was based on operational data that was
in effect at that time. Since 2012, the City has experienced substantial organizational
changes and there have been significant changes in the cost of operations. Staff
believes that it would be imprudent to finalize the draft study in its current form since it is
based on outdated data and does not reflect the current operational characteristics of
the City. In addition, because of the age of the data underlying the current draft, if it
was implemented without updating, a new study would need to be performed shortly
after implementation of the current draft. Accordingly, building upon the existing study
with updated data would be less costly in the long-run. The updated study could be
used for the next five years, without the City having to re-incur all of the costs that would
be associated with a new study.
Included within the scope of work for the user fee study is the development of a cost
allocation plan. In addition to providing a basis for the establishment of user fees, a
cost allocation plan is important to ensure that the City fully recovers all costs
associated with grant-financed programs and that the General Fund is properly
reimbursed by other funds of the City.
The recommended amendment to the existing agreement with NBS Government
Finance Group will provide the necessary funds to properly update the study and to
properly implement its execution. It also includes funds to provide a comparison of
proposed user fees to those of five comparable cities.
FISCAL IMPACT:
This action will increase General Fund appropriations by $27,200.
ENVIRONMENTAL IMPACT:
Not applicable .
City Council Agenda Report
November 15, 2016
Page 3 of 3
PRIOR CITY COUNCIL REVIEW:
On October 2, 2012, the City Council approved an agreement with NBS Government
Finance Group to conduct a City-wide comprehensive user fee study and develop a
cost allocation plan for use by the City.
On December 17, 2013, the City Council approved an amendment to the agreement
with NBS Government Finance Group.
COMMISSION/COMMITTEE/BOARD REVIEW AND RECOMMENDATIONS:
Not applicable.
NOTIFICATION:
NBS Government Finance Group -Greta Davis
ATTACHMENTS:
Attachment 1 -Amendment to Personal Services Agreement
Attachment 2 -Personal Services Agreement with NBS Government Finance Group
THIRD AMENDMENT TO
PERSONAL SERVICES AGREEMENT
THIS AMENDMENT to the Personal Services Agreement between the City of
San Juan Capistrano ("City") and NBS Government Finance Group, dba NBS
("Consultant") is made and entered into, to be effective the 151h day of November, 2016,
as follows:
RECITALS
WHEREAS, the City has retained the services of Consultant to develop a Cost
Allocation Plan and conduct a City-wide User Fee and Rate Study pursuant to that
Agreement dated as of October 2, 2012; and,
WHEREAS, the City and Consultant desire to amend the terms of the Agreement
as provided hereunder.
AMENDMENT
NOW, THEREFORE, in consideration of the promises and mutual covenants
contained therein, City and Consultant agree to amend the Agreement between City
and Consultant as follows:
Section 1 -Scope of Work
The scope of work to be performed by the Consultant shall be amended to
include an update of the Cost Allocation Plan and City-wide User Fee and Rate Study to
reflect budgeted data for the fiscal year ended June 30, 2017 with respect to the
number of full-time equivalents and increases in the cost of expenses. After receiving
feedback from departments as to fee adjustments and fees to be added to the study,
Consultant will provide one additional iterative review for each of the departments. If
needed, up to one department can make more substantive changes with respect to time
estimates and staffing allocations. An additional iterative review will be provided for the
final report with respect to changes in the narrative section of the report. Consultant will
provide two community stakeholder or public meetings. The Consultant will also provide
fee information for five other cities for comparison with the fees developed as a result of
this study.
Section 2 -Term
This Agreement is extended and shall terminate no later than December 31,
2017.
Section 3 -Compensation
3.1 Amount.
Total compensation for the services for the Cost Allocation Plan and City-Wide
User Fee and Rate Study hereunder shall not exceed $63,840.
Section 14.5-Errors and Omissions Coverage
At all times during the performance of the work under this Agreement the
Consultant shall maintain professional liability or Errors and Omissions insurance
appropriate to its profession, in a form and with insurance companies acceptable to the
City in the amount of $2 million per occurrence and in the aggregate. This insurance
shall be endorsed to include contractual liability applicable to this Agreement and shall
be written on a policy form coverage specifically designed to protect against acts, errors
or omissions of the Consultant. "Covered Professional Services" as designated in the
policy must specifically include work performed under this Agreement. The policy must
"pay on behalf of' the insured and must include a provision establishing the insurer's
duty to defend.
All other provisions of the Agreement not amended hereunder shall remain in full force
and effect.
(SIGNATURE PAGE FOLLOWS)
ATTACHMENT 1-Page 2 of 3
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
ATTEST :
By: ______________________ __
Maria Morris, City Clerk
APPROVED AS TO FORM:
BY : -------------------------Jeffrey Ballinger, City Attorney
CITY OF SAN JUAN CAPISTRANO
By: ______________________ __
Benjamin Siegel, City Manager
CONSULTANT
By: ______________________ __
Michael Rentner, President & CEO
ATTACHMENT 1-Page 3 of 3
PERSONAL SERVICES AGREEMENT
~ "\l
. THIS AGREEMENT is made, entered into, and shall become effective this '·...)_ -'a ay
of l.l:L. 2012, by and between 1he City of San Juan Capistrano (hereinafter referred to
as the 11City") and NBS Government Finance Group, DBA NBS (hereinafter referred to as
the "Consultant").
RECITALS :
WHEREAS, City desires to retain the services ofthe Consultant regarding the City's
proposal to develop a Cost Allocation Plan and conduct a City-wide User Fee and Rate
Study; and,
WHEREAS, the City also desires to retain the services of Consultant to review and
recommend updates to the City's Park & Recreation and Capistrano Circulation Fee
Program Fees; and,
WHEREAS, Consultant is qualified by virtue of experience, training, education and
expertise to accomplish such services.
NOW, THEREFORE, City and Consultant mutually agree as follows:
Section 1 . Scope of Work.
The scope of work to be performed by the Consultant shall consist of those tasks as
set forth in Exhibits "A" and "B" attached and incorporated herein by reference. To the
extent that there are any conflicts between the provisions described in Exhibits "A" and "B"
and those provisions contained within this Agreement, the provisions in this Agreement
shall control. The scope of work to be performed will not include the optional services , to
perform an "Art in Public Places In-Lieu Fee Analysis" as set forth in Exhibit "B ."
Section 2. Term .
This Agreement shall commence on the effective date and shall terminate, and all
servic~s required hereunder shall be completed, no later than June 30,2013.
Secti on 3. Compensation.
3.1 Amount.
Total compensation for the services for the Cost Allocation Plan and City-
Wide User Fee and Rate Study hereunder shall not exceed $30,790, including expenses
as set forth in Exhibit "A". Total compensation for the review and update of the City's Park
and Recreation and Capistrano Circulation Fee Program Fees hereunder shall not exceed
$18,280 , including expenses, as set forth in Exhibit "B", by reference.
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ATTACHMENT 2-Page 1 of 7
3.2 Method of Payment.
Subject to Section 3.1, Consultant shall submit invoices based on the total
services which have been satisfactorily completed and as outlined in Exhibits UA" and "8"
The City will pay approved invoices in accordance with this Section.
3.3 Records of Expenses .
Consultant shall keep complete and accurate records of all costs and
expenses incidental to services covered by this Agreement. These records will be made
available at reasonable times to the City. Invoices shall be addressed as provided for in
Section 16 below.
Section 4. Independent Contractor.
It is agreed that Consultant shall act and be an independent contractor and not an
agent or employee of the City, and shall obtain no rights to any benefits which accrue to
City's employees.
Section 5. Limitations Upon Subcontracting and Assignment.
The experience, knowledge, capability and reputation of Consultant, its principals
and employees were a substantial inducement for the City to enter into this Agreement.
Consultant shall not contract with any other entity to perform the services required without
prior written approval of the City. This Agreement may not be assigned , voluntarily or by
operation of law, without the prior written approval of the City. If Consultant is permitted to
subcontract any part of this Agreement by City, Consultant shall be responsible to the City
for the acts and omissions of its subcontractor as it is for persons directly employed.
Nothing contained in this Agreement shall create any contractual relationships between
any subcontractor and City. All persons engaged in the work will be considered employees
of Consultant. City will deal directly with and will make all payments to Consultant.
Section 6. Changes to Scope of Work.
For extra work not part of this Agreement, a written authorization from City is
required prior to Consultant undertaking any extra work. In the event of a change in the
Scope of Work provided for in the contract documents as requested by the City, the Parties
hereto shall execute an addendum to this Agreement setting forth with particularity all
terms of the new agreement, including but not limited to any additional Consultant's fees.
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ATTACHMENT 2-Page 2 of 7
Section 7. Familiarity with Work and/or Construction Site.
By executing this Agreement, Consultant warrants that: (1) it has investigated the
work to be performed; (2) if applicable, it has investigated the work site(s), and is aware of
all conditions there; and (3) it understands the facilities, difficulties and restrictions of the
work to be performed under this Agreement. Should Consultant discover any latent or
unknown conditions materially differing from those inherent in the work or as represented
by City, it shall immediately inform the City of this and shall not proceed with further work
under this Agreement until written instructions are received from the City.
Section 8. Time of Essence.
Time is of the essence in the performance of this Agreement.
Section 9. Comp li ance with law .
Consultant shall comply with all applicable laws, ordinances, codes and regulations
of federal, state and local government.
Section 10. Conflicts of In terest.
Consultant covenants that it presently has no interest and shall not acquire any
interest, direct or indirect, Which would conflict in any manner or degree with the
performance of the services contemplated by this Agreement. No person having such
interest shall be employed by or associated with Consultant.
Section 11. Copies of Work Produ ct.
At the completion of the work, Consultant shall have delivered to City at least one
(1) printed copy of any final reports and/or notes or drawings containing Consultant's
findings, conclusions, and recommendations with any supporting documentation and an
electronic copy. All reports submitted to the City shall be in reproducible format, or in the
format otherwise approved by the City in writing.
Section 12. Ownership of Documents .
All reports, information, data and exhibits prepared or assembled by Consultant in
connection with the performance of its services pursuant to this Agreement are confidential
to the extent permitted by law, and Consultant agrees that they shall not be made available
to any individual or organization without prior written consent of the City. All such reports,
information, data, and exhibits shall be the property of the City and shall be delivered to the
City upon demand without additional costs or expense to the City.
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ATTACHMENT 2-Page 3 of 7
Section 13. Inde mn ity.
To the fullest extent permitted by law, Consultant agrees to protect, defend, and
hold harmless the City and its elective and appointive boards, officers, agents, and
employees from any and all claims, liabilities, expenses, or damages of any nature,
including attorneys' fees, for injury or d eath of any person, or damages of any nature,
including interference with use of property, arising out of, or in any way connected wi th the
negligence, recklessness and/or intentional wrongful conduct of Consultant, Consultant's
agents, officers, employees, subcontractors, or independent contractors hired by
Consultant in the performance of the Agreement. The only exception to Consultant's
responsibility to protect, defend, and hold harmless the City, is due to the active
negligence, recklessness and/or wrongful conduct of the City, or any of its elective or
appointive boards, officers, agents, or employees.
This hold harmless agreement shall apply to all liability regardless of whether any
insurance policies are applicable . Any policy limits shall not act as a limitation upon the
amount of indemnification to be provided by Consultant.
Section 14. tnsurance.
Before beginning any of the services or work called for by any term of this
Agreement, Consultant, at its own cost and expense, shall carry, maintain for the duration
of the agreement, and provide proof thereof that is acceptable to the City, the insurance
specified below with insurers and under forms of insurance satisfactory in all respects to
the City. Consultant shall not allow any subcontractor to commence work on any
subcontract until all insurance required of the Consultant has also been obtained for the
subcontractor. Insurance required herein shall be provided by Insurers in good standing
with the State of California and having a minimum Best's Guide Rating of A-Class VII or
better.
14.1 Comprehensive General Liability.
Throughout the term of this Agreement, Consultant shall maintain in full force
and effect Comprehensive General Liability coverage in an amount not less than one
million dollars per occurrence ($1 ,000,000.00), combined single limit coverage for risks
associated with the work contemplated by this Agreement. If a Commercial General
liability Insurance form 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
Agreement or the general aggregate limit shall be at least twice the required occurrence
limit.
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ATTACHMENT 2-Page 4 of 7
14.2 Comprehensive Automobile Liability.
Throughout the term of this Agreement, Consultant shall maintain in full force
and effect Comprehensive Automobile Liability coverage, including owned, hired and non-
owned vehicles In an amount not less than one million dollars per occurrence
($1 ,000,000.00).
14.3 Workers' Compensation.
If Consultant intends to employ employees to perform services under this
Agreement, Consultant shall obtain and maintain, during the term of this Agreement,
Workers' Compensation Employer's Liability Insurance in the statutory amount as required
by state law. '
14.4 Proof of Insurance Requirements/Endorsement.
Prior to beginning any work under this Agreement, Consultant shall submit
the insurance certificates, including the deductible or self-retention amount, and an
additional insured endorsement naming City, its officers, employees, agents, and
volunteers as additional insured as respects each of the following: Liability arising out of
activities performed by or on behalf of Consultant, including the insured's general
supervision of Consultant; products and completed operations of Consultant; premises
owned, occupied or used by Consultant; or automobiles owned, leased, hired, or borrowed
by Consultant. The coverage shall contain no special limitations on the scope of protection
afforded City, its officers, employees, agents, or volunteers.
14.5 Errors and Omissions Coverage
Throughout the term of this Agreement, Consultant shall maintain Errors and
Omissions Coverage (professional liability coverage) in an amount of not less than One
Million Dollars ($1 ,000,000). Prior to beginning any work under this Agreement, Consultant
shall submit an insurance certificate to the City's General Counsel for certification that the
insurance requirements of this Agreement have been satisfied.
14.6 Notice of Cancellation/Termination of Insurance.
The above policy/policies shall not terminate, nor shall they be cancelled , nor
the coverages reduced, until after thirty (30) ·days' written notice is given to City, except that
ten (10) days' notice shall be given if there is a cancellation due to failure to pay a
premium.
14.7 Terms of Compensation.
Consultant shall not receive any compensation until all insurance provisions
have been satisfied .
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ATTACHMENT 2-Page 5 of 7
14.8 Notice to Proceed.
Consultant shall not proceed with any work under this Agreement until the
City has issued a written "Notice to Proceed" verifying that Consultant has complied with all
insurance requirements of this Agreement.
Section 15. Termination.
City shall have the right to terminate this Agreement without cause by giving thirty
(30) days' advance written notice of termination to Consultant.
In addition, this Agreement may be terminated by any party for cause by providing
ten (1 0) days' written notice to the other party of a material breach of contract. If the other
party does not cure the breach of contract, then the agreement may be terminated
subsequent to the ten (1 0) day cure period.
Section 16. Notice.
All notices shall be personally delivered or mailed to the below listed addresses, or
to such other addresses as may be designated by written notice . These addresses shall
be used for delivery of service of process:
To City: City of San Juan Capistrano
32400 Paseo Adelanto
San Juan Capistrano, CA 92675
Attn: Cindy Russell, Chief Financial Officer/City Treasurer
To Consultant: NBS Government Finance Group, DBA NBS
32605 Temecula Parkway, Suite 100
Temecula, CA 92592
Attn: Michael Rentner, President & CEO
Section 17. Attorneys' Fees .
If any action at law or in equity is necessary to enforce or interpret the terms of this
Agreement, the prevailing party shall be entitled to reasonable attorneys' fees, expert
witness fees, costs and necessary disbursements in addition to any other relief to which he
may be entitled.
Section 18. Dispute Re s ol ution .
In the event of a dispute arising between the parties regarding performance or
interpretation of this Agreement, the dispute shall be resolved by binding arbitration under
the auspices of the Judicial Arbitration and Mediation Service ("JAMS"), Orange County
Office.
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ATTACHMENT 2-Page 6 of 7
Section 19. Entire Ag eement.
This Agreement constitutes the entire understanding and agreement between the
parties and supersedes all previous negotiations between them pertaining to the subject
matter thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
CITY o • AN JUAN cAP ISTRANO
CONSULTANT
NBS GOVERNMENT FINANCE GROUP
DBA NBS I
By: 2/l/[/ «._ ,
Michael Rentner, President & CEO
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ATTACHMENT 2-Page 7 of 7