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HomeMy WebLinkAboutContracts & Agreements_143-2011_CCv0001.pdf AGREEMENT FOR THE PROVISION OF PROFESSIONAL CONSULTING SERVICES This agreement for the provision of consulting services for the City of Redlands ("Agreement") is made and entered into this 4h day of October, 2011 ("Effective Date"), by and between the City of Redlands, a municipal corporation ("City") and Communications Support Group,Inc.("Consultant"). City and Consultant are sometimes individually referred to herein as a "Party"and,together, as the"Parties." In consideration of the mutual promises contained herein, City and Consultant agree as follows: ARTICLE 1 -ENGAGEMENT OF CONSULTANT 1.1 City hereby engages Consultant to perform a comprehensive agreed-upon procedures review of franchise fees for a three-year period on Verizon California and Time Warner Cable(the"Services"). 1.2 The Services shall be performed by Consultant in a professional manner, and Consultant represents that it has the skill and the professional expertise necessary to provide the Services to City at a level of competency presently maintained by other practicing professional consultants in the industry providing like and similar types of Services. ARTICLE 2 -SERVICES OF CONSULTANT 2.1 The Services that Consultant shall perform are more particularly described in Exhibit "A,"entitled"Proposed Procedures,"which is attached hereto and incorporated herein by reference. 2.2 Consultant shall comply with applicable federal,state and local laws and regulations in the performance of this Agreement including,but not limited to,the Americans with Disabilities Act, the Fair Employment and Housing Act and prevailing wage laws. ARTICLE 3 -RESPONSIBILITIES OF CITY 3.1 City shall make available to Consultant information in its possession that may assist Consultant in performing the Services. 3.2 City designates Tina Kundig as City's representative with respect to performance of the Services,and such person shall have the authority to transmit instructions, receive information, interpret and defuse City's policies and decisions with respect to performance of the Services. ARTICLE 4-PE NCE OF SERVICES 4.1 Consultant shall perform the Services in a prompt and diligent manner. 4.2 During the term of this Agreement.City may request that Consultant perform Extra Services. As used herein, "Extra Services"means any worts that is determined necessary 1 I\ca\dtm\Apt me \Communication55uppmt.9 27.11 AM by City for the proper completion of the project or work for which the Services are being performed, but which the Parties did not reasonably anticipate would be necessary at the time of execution of this Agreement.Provided the Extra Services do not exceed twenty percent(20%)of the compensation to be paid by City to Consultant for the Services, such Extra Services may be agreed to by the Parties by written amendment to this Agreement, executed by a duly authorized City official in accordance with Chapter 2.16 of the Redlands Municipal Code. Consultant shall not perform,nor be compensated for, Extra Services without such written authorization from City. ' ARTICLE 5 -PAYMENTS TO CONSULTANT 5.1 The total compensation for Consultant's performance of the Services shall not exceed the amount of Fifty-Two Thousand Dollars($52,000).City shall pay Consultant on a time and materials basis up to the not to exceed amount, and at the hourly rates specified in Exhibit «B „ 5.2 Consultant shall submit monthly invoices to City describing the work performed during the preceding month. Consultant's invoices shall include a brief description of the Services performed,the dates the Services were performed,the number of hours spent and by whom, and a description of reimbursable expenses related to the project.City shall pay Consultant no later than thirty (30)days after receipt and approval by City of Consultant's invoice. 5.3 All notices shall be given in writing by personal delivery or by mail. Notices sent by mail should be addressed as follows: City Consultant: Tina Kundig, Finance Director/City Treasurer John Risk,President City of Redlands Communications Support Group, Inc 35 Cajon Street, Suite 30 1255 Somerset Lane Redlands,CA 92373 Newport Beach, CA 92660 When so addressed, such notices shall be deemed given upon deposit in the United States Mail. Changes may be made in the names and addresses of the person to whom notices and payments are to be given by giving notice pursuant to this section 5.3. ARTICLE 6-INSURANCE AND INDEMNIFICATION 6.1 Insurance. Insurance required by this Agreement shall be maintained by Consultant for the duration of its performance of the Services.Consultant shall not perform any Services unless and until required insurance listed below is obtained by Consultant.Consultant shall provide City with certificates of insurance and endorsements evidencing such insurance prior to commencement of the Services. Insurance policies shall include a provision prohibiting cancellation or modification of the policy except upon thirty(30) days' prior written notice to City,provided,however,the policies shall allow for ten (10) days notice for cancellation to City due to non-payment of premium. 2 i'\ca\djm\AgreementstCcunmunicationsSupport.927.1 i.doc 6.2 Workers' Compensation and Employer's Liability. Consultant shall secure and maintain Workers' Compensation and Employer's Liability insurance throughout the duration of its performance of the Services in accordance with the laws of the State of California, with an insurance carrier acceptable to City as described in Exhibit "E,"entitled "Workers' Compensation Insurance Certification,"which is attached hereto and incorporated herein by this reference. 6.3 Hold Harmless and Indemnification. Consultant shall defend, indemnify and hold harmless City and its elected officials,employees and agents from and against any and all claims„ losses or liability, including attorneys' fees,arising from injury or death to persons or damage to property occasioned by and negligent act,omission or failure to act by Consultant, its officers,employees and agents in performing the Services. 6.4 Comprehensive General Liability Insurance.Consultant shall secure and maintain in force throughout the term of this Agreement comprehensive general liability insurance with carriers acceptable to City.Minimum coverage of One Million Dollars($1,000,000) per occurrence and Two Million Dollars($2,000,000)aggregate for public liability, property damage and personal injury is required. City shall be named as an additional insured and the insurance policy shall include a provision prohibiting modification of coverage I imits or cancellation of the policy except upon thirty(30)days prior written notice to City. Such insurance shall be primary and non-contributing to any insurance or self-insurance maintained by City.Certificates of insurance shall be delivered to City prior to commencement of the Services. 6.5 Business Auto Liability Insurance. Consultant shall have business auto liability coverage, with minimum limits of One Million Dollars($1,000,0(x})per occurrence,combined single limit for bodily injury liability and property damage liability.This coverage shall include all Consultant owned vehicles used in connection with Consultant's provision of the Services, hired and non-owned vehicles,and employee non-ownership vehicles.City shall be named as an additional insured and a certificate of insurance and endorsement shall be delivered to City prior to commencement of the services. Such insurance shall be primary and non-contributing to any insurance or self insurance maintained by City. ARTICLE 7-CONFLICTS OF INTEREST 7.1 Consultant covenants and represents that it does not have any investment or interest in any real property that may be the subject of this Agreement or any other source of income, interest in real property or investment that would be affected in any manner or degree by the performance of Consultant's Services.Consultant further covenants and represents that in the performance of its duties hereunder, no person having any such interest shall perform any Services under this Agreement. 7.2 Consultant agrees it is not a designated employee within the meaning of the Political Refonn Act because Consultant: 3 c\cakljm\Agreenvu"\Communicatioass urk9.a7.I Ldoc A.Does not make or participate in: (i)the making or any City governmental decisions regarding approval of rate, rule or regulation, or the adoption or enforcement of laws; (ii)the issuance, denial, suspension or revocation of City permits, licenses, applications,certifications, approvals, orders or similar authorizations or entitlements; (iii)authorizing City to enter into, modify or renew a contract; (iv)granting City approval to a contract that requires City approval and to which City is a party, or to the specifications for such a contract; (v)granting City approval to a plan,design,report, study or similar item; (vi)adopting, or granting City approval of,policies,standards or guidelines for City or for any subdivision thereof. B. Does not serve in a staff capacity with City and in that capacity, participate in making a governmental decision or otherwise perform the same or substantially the same duties for City that would otherwise be performed by an individual holding a position specified in City's Conflict of Interest Code under Government Code section 87302. 7.3 In the event City officially determines that Consultant must disclose its financial interests by completing and filing a Fair Political Practices Commission Form 700,Statement of Economic Interests.Consultant shall file the subject Form 700 with the City Clerk's office pursuant to the written instructions provided by the Office of the City Clerk. ARTICLE 8-GENERAL CONSIDERATIONS 8.1 Attorney sem' Fees. In the event any action is commenced to enforce or interpret any of the terms or conditions of this Agreement the prevailing Party shall,in addition to any costs and other relief, be entitled to the recovery of its reasonable attorneys'fees, including fees for the use of in-house counsel by a Party. 8.2 Prohibition Against Assignment. Consultant shall not assign any of the Services,except with the prior written approval of City and in strict compliance with the terms,and conditions of this Agreement. 8.3 Documents and Records.Project related documents, records,drawings, designs,cost estimates,electronic data files, databases and any other documents developed by Consultant in connection with its performance of the Services,and any copyright interest in such documents, shall become the property of City and shall be delivered to City upon completion of the Services,or upon the request of City, subject to the terms of any binding non-disclosure agreement required by Time Warner and Verizon respectively. Any reuse of such documents,and any use of incomplete documents,shall be at City's 4 1lcaidjm�AgmementsUCommunieationssupport.9.27.1 l.doc sole risk. 8.4 Independent Contractor Status. Consultant is for all purposes under this Agreement an independent contractor and shall perform the Services as an independent contractor. Neither City nor of its agents shall have control over the conduct of Consultant or Consultant's employees, except as herein set forth.Consultant shall supply necessary tools and instrumentalities required to perform the Services.Assigned personnel employed by Consultant are for its account only,and in no event shall Consultant or personnel retained by it be deemed to have been employed by City or engaged by City for the account of, or on behalf of City.Consultant shall have no authority,express or implied,to act on behalf of City in any capacity whatsoever as an agent,nor shall Consultant have any authority, express or implied,to bind City to any obligation. 8.5 Termination. A.Unless earlier terminated as provided for below,this Agreement shall terminate upon completion and acceptance of the Services by City. B.This Agreement may be terminated by City, in its sole discretion,by providing thirty (30)days' prior written notice to Consultant(delivered by certified mail,return receipt requested)of City's intent to terminate. C. If this Agreement is terminated by City, an adjustment to Consultant's compensation shall be made, but(1)no amount shall be allowed for anticipated profit or unperformed Services, and(2)any payment due Consultant at the time of termination may be adjusted to the extent of any additional costs to City occasioned by any default by Consultant. D.Upon receipt of a termination notice, Consultant shall immediately discontinue its provision of the Services and,within five(5)days of the date of the termination notice, deliver or otherwise make available to City,copies(in both hard copy and electronic form,where applicable)of project related data,design calculations,drawings, specifications,reports,estimates,summaries and such other information and materials as may have been accumulated by Consultant in performing the Services, subject to the terms of any binding non-disclosure agreement required by Time Warner and Verizon respectively.Consultant shall be compensated on an hourly,time and materials basis for Services completed up to the date of termination. 8.6 Entire Agreement/Amendment. This Agreement, including the Exhibits incorporated herein by reference, represents the entire agreement and understanding between the Parties as to the matters contained herein,and any prior negotiations, written proposals or verbal agreements relating to such matters are superseded by this Agreement. Except as otherwise provided for herein,an amendment to this Agreement shall be in writing, approved by City and signed by City and Consultant. 8.7 Governing Law.This Agreement shall be governed by and construed in accordance with the laws of the State of California. 1:\csWjmlAgreements\Communic,atio-Support 9.27A Ldoc IN WITNESS WHEREOF, duly authorized representatives of the City and Consultant have signed in confirmation of this Agreement. CITY OF REDLANDS COMMUNICATIONS SUPPORT GROUP,INC. A �—)Ili 4 1 �Ij By: ��t�L --V, By: OA�4j Pete Alivilar,Mayor John R k,President Attest: Sam Irwin, City Clerk 6 1\CaWjm\AWeemnts\CommunicatiomSttpporL927.1 1,doc EXHIBIT "All SCOPE OF SERVICES A-1 I:kawjmlAgreements\CommunicatimisSuppott9,27-1 l.doc City of Redlands EXHIBIT Consulting Proposal-Communications Support Group,Inc. #'As!p PROPOSED MQMURES 1. Nature of Engagement: This will be an agreed-upon procedures engagement, with certain procedures complying to the rules of the American Institute of Certified Public Accountants("AICPA"). 2. Proposed Procedures: In connection with this engagement we propose to review Verizon and Time Warner books and records to assist the City in determining the companies have paid the City the appropriate cable franchise fees (and PEG fees if any) for the three year-period from January 1, 2008 through December 31, 2010. Our review will consist of the following procedures: Please 1 a. Shortly after we receive a signed engagement letter or contract from the City, we will send a document request to the City. The letter will include a request that the City provide us with any of the following documents that are not otherwise available for access on the City's web site: • Copies of the City's Cable Ordinance, Cable Franchise Agreement(s), Transfer Agreements, Renewal Agreements, and any other agreements, letters, memorandums or written correspondence with Verizon and Time Warner that may govern the franchise fee obligations of Verizon and Time Warner prior to, and during,the review period. • Franchise fee tax returns filed with the City by Verizon and Time Warner for the review period, including transmittal letters and any back up schedules or other information submitted by Verizon and Time Warner.Also,-if Verizon and Time Warner made any"true up" payments to correct previous franchise fee payments, please provide copies of those payments and the supporting schedules. • Rate and channel information for the four calendar years 2007,2008, 2009 and 2010. • An Excel listing of all residential address with approximately 50 addresses of homes along City borders specifically identified. • Annexation information for the calendar years 2008 through 2010, if applicable. b. We will prepare and forward certain questionnaires to Verizon and Time Warner to solicit information regarding the company's payment of franchise fees during the respective review periods. c. We will review the ordinances and agreements between the City and Verizon and Time Warner to identify definitions of"gross revenues", fi-anchise fee rates, late Payment Provisions, etc. d. We will discuss with the City and execute any non-disclosure agreements required by the companies. 0 2011 Communications Support Group, Inc. City of Redlands Consulting Proposal-Communications Support Group, Inc. Phase 2 We will request that copies of certain books and records of Verizon and Time Warner either be forwarded to our offices in California, or be made available at a Verizon and Time Warner Regional office in Southern California. In connection with the review of these records: a. We will review Verizon and Time Warner's internal control systems and procedures related to accounting for gross revenues, and franchise fee payments. We will identify the various types of revenue recorded by Verizon and Time Warner. We will determine whether the company is calculating fees on an accrual basis or cash basis. b. We will analyze Verizon and Time Warner's method of accounting for non-subscriber revenues, including advertising revenues, home shopping revenues, cable launch fees and other such revenues. c. We will review Verizon and Time Warner's method for identifying subscribers to the proper franchise area and perform a detailed review of addresses of homes passed by cable. d. We will test subscriber revenue by comparison with amounts recorded on reports from the company's outside service bureau. e. We will review the accounting records of Verizon and Time Warner for any revenue items not being reported to the City with the periodic remittances, including franchise fee worksheets, general ledgers, profit and loss statements, and billing system reports. f. We will analyze all revenues accounts of Verizon and Time Warner as to whether it has been paying franchise on PEG fee revenue (if any), franchise fee revenue and FCC regulatory fee revenue for the review period. g. We will test the mathematical accuracy of the selected franchise fee remittances to the City for the review period. Phase 3 We will review findings with the company and obtain the provider's position on the findings. We will issue a report on our findings to the City within forty-five days of the successful delivery of all information requested of Verizon and Time Warner. Said findings will include any penalties and interest computations allowable under the City's various ordinances and codes. Our reports will provide schedules of our findings compliant with any required non-disclosure agreements. Caveat Regarding the Possible Results of this Zmm ement The management of the City is advised that, on occasion, these engagements disclose that the cable operator has overpaid franchise fees. Accordingly, this engagement could discover refunds owed by the City to Verizon and Tune Warner, Should the City elect, we have provided pricing for adding a fourth and partial fifth year to the Time Warner review. 0 2011 Communications Support Group,Inc. EXHIBIT FEE PROPOSAL CSG proposes to perform a comprehensive agreed-upon procedures review of franchise fees and PEG fees for a three-year period on Verizon for an amount not to exceed $26,000 should no PEG fee component be included and $29,000 should PEG fees be analyzed. CSG proposes to perform an agreed-upon procedures review of franchise fees and PEG fees for a three year period of Time Warner for an amount not to exceed $26,000 should no PEG fee component be included and$29,000 should PEG fees be analyzed. We propose calendar years 2008-2010 for both companies. However, should the City wish us to perform additional years of review for Time Warner, we offer a review of calendar year 2007 for $10,000 and the partial year August 2006 — December 2006 for$5,000 as a la carte offerings. We agree to perform all services on an hourly basis. Both Mr. Risk's and Mr. Morgan's time will be billed at a rate of$200 per hour. Associates are billed at rates of$100 and$85 respectively. We will invoice the City monthly for our services. Invoices are payable on presentation. A finance charge of 1% per month will be added to fees billed but not received before the end of the month following the month of our invoice. This corresponds to an Annual Percentage Rate (APR) of 12%. No finance charge will be imposed on unpaid finance charges. Also, our fees will be payable in full regardless of findings that result from this engagement. Provisions for Adjustment in Fixed Fee Arrangement The quotes stated above for each of these phases is estimated based upon the following assumptions: • Verizon and Time Warner will complete and return all of our questionnaires, addenda, and emailed question, together with all requested documents and Verizon and Time Warner prepared schedules. • Verizon and Time Warner will have personnel available who are knowledgeable regarding franchise fees and PEG fee reporting to work with CSG and DE&CD.. • No travel time or expenses to either Verizon corporate offices in Texas or Time Warner's corporate offices in Stanford,CT. Should Verizon and Time Warner not provide the requested questionnaires, information or documents,or should we need to travel to out of state, we will communicate these circumstances to the City in writing. We may request that the City approve a fee increase to cover any additional services or expenses that may be involved. We agree to not incur additional expenses without express written consent of the City. Also, it is the policy of both CSG and DE&CO not to bid work on a "contingency fee" basis. It has been our experience that such a fee arrangement gives the perception of a conflict of interest, and cable companies often will not accept consultants who contract on a contingent fee basis. 02011 Communications Support Group, Inc. Fee Proposal Page 1 of 1