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HomeMy WebLinkAboutThe Reed Group, Inc. 2020-01-16CONTRACT #1920196 AGREEMENT FOR PROFESSIONAL CONSULTING SERVICES This Agreement, made and entered into this 16th day of January, 2020 ("Effective Date"), by and between CITY OF UKIAH, CALIFORNIA, hereinafter referred to as "City" and The Reed Group, Inc., a corporation organized and in good standing under the laws of the state of California, hereinafter referred to as "Consultant". RECITALS This Agreement is predicated on the following facts: a. City requires consulting services related to preparation of a water rate study. b. Consultant represents that it has the qualifications, skills, experience and properly licensed to provide these services, and is willing to provide them according to the terms of this Agreement. c. City and Consultant agree upon the Scope -of -Work attached hereto as Attachment "A" and Work Schedule attached hereto as Attachment "A", describing contract provisions for the project and setting forth the completion dates for the various services to be provided pursuant to this Agreement. TERMS OF AGREEMENT 1.0 DESCRIPTION OF PROJECT 1.1 The Project is described in detail in the attached Scope -of -Work (Attachment "A"). 2.0 SCOPE OF SERVICES 2.1 As set forth in Attachment "A". 2.2. Additional Services. Additional services, if any, shall only proceed upon written agreement between City and Consultant. The written Agreement shall be in the form of an Amendment to this Agreement. 3.0 CONDUCT OF WORK 3.1 Time of Completion. Consultant shall commence performance of services as required by the Scope -of -Work upon receipt of a Notice to Proceed from City and shall complete such services as soon as possible. Consultant shall complete the work to the City's reasonable satisfaction, even if contract disputes arise or Consultant contends it is entitled to further compensation. Attachment A sets forth the expected schedule for the services to be provided. 4.0 COMPENSATION FOR SERVICES 4.1 Basis for Compensation. For the performance of the professional services of this Agreement, Consultant shall be compensated on a time and expense basis not to exceed a guaranteed maximum dollar amount of $32,100. Labor charges shall be based upon hourly billing rates for the various classifications of personnel employed by Consultant to perform the Scope of Work as set forth in the attached Attachment A, Contract 1920-196 — Reed Group — Water Rate Study PAGE 1 OF 7 CONTRACT #1920196 which shall include all indirect costs and expenses of every kind or nature, except direct expenses. The direct expenses and the fees to be charged for same shall be as set forth in Attachment A. Consultant shall complete the Scope of Work for the not -to - exceed guaranteed maximum, even if actual time and expenses exceed that amount. 4.2 Changes. Should changes in compensation be required because of changes to the Scope -of -Work of this Agreement, the parties shall agree in writing to any changes in compensation. "Changes to the Scope -of -Work" means different activities than those described in Attachment A and not additional time to complete those activities than the parties anticipated on the date they entered this Agreement. 4.3 Sub -contractor Payment. The use of sub -consultants or other services to perform a portion of the work of this Agreement shall be approved by City prior to commencement of work. The cost of sub -consultants shall be included within guaranteed not -to -exceed amount set forth in Section 4.1. 4.4 Terms of Payment. Payment to Consultant for services rendered in accordance with this contract shall be based upon submission of monthly invoices for the work satisfactorily performed prior to the date of the invoice less any amount already paid to Consultant, which amounts shall be due and payable thirty (30) days after receipt by City. The invoices shall provide a description of each item of work performed, the time expended to perform each task, the fees charged for that task, and the direct expenses incurred and billed for. Invoices shall be accompanied by documentation sufficient to enable City to determine progress made and to support the expenses claimed. 5.0 ASSURANCES OF CONSULTANT 5.1 Independent Contractor. Consultant is an independent contractor and is solely responsible for its acts or omissions. Consultant (including its agents, servants, and employees) is not the City's agent, employee, or representative for any purpose. It is the express intention of the parties hereto that Consultant is an independent contractor and not an employee, joint venturer, or partner of City for any purpose whatsoever. City shall have no right to, and shall not control the manner or prescribe the method of accomplishing those services contracted to and performed by Consultant under this Agreement, and the general public and all governmental agencies regulating such activity shall be so informed. Those provisions of this Agreement that reserve ultimate authority in City have been inserted solely to achieve compliance with federal and state laws, rules, regulations, and interpretations thereof. No such provisions and no other provisions of this Agreement shall be interpreted or construed as creating or establishing the relationship of employer and employee between Consultant and City. Consultant shall pay all estimated and actual federal and state income and self- employment taxes that are due the state and federal government and shall furnish and pay worker's compensation insurance, unemployment insurance and any other benefits required by law for himself and his employees, if any. Consultant agrees to indemnify and hold City and its officers, agents and employees harmless from and against any claims or demands by federal, state or local government agencies for any such taxes or benefits due but not paid by Consultant, including the legal costs associated with defending against any audit, claim, demand or law suit. Contract 1920-196 — Reed Group — Water Rate Study PAGE 2 OF 7 CONTRACT #1920196 Consultant warrants and represents that it is a properly licensed professional or professional organization with a substantial investment in its business and that it maintains its own offices and staff which it will use in performing under this Agreement. 5.2 Conflict of Interest. Consultant understands that its professional responsibility is solely to City. Consultant has no interest and will not acquire any direct or indirect interest that would conflict with its performance of the Agreement. Consultant shall not in the performance of this Agreement employ a person having such an interest. If the City Manager determines that the Consultant has a disclosure obligation under the City's local conflict of interest code, the Consultant shall file the required disclosure form with the City Clerk within 10 days of being notified of the City Manager's determination. 6.0 INDEMNIFICATION 6.1 Insurance Liability. Without limiting Consultant's obligations arising under Paragraph 6.2 Consultant shall not begin work under this Agreement until it procures and maintains for the full period of time allowed by law, surviving the termination of this Agreement insurance against claims for injuries to persons or damages to property, which may arise from or in connection with its performance under this Agreement. A. Minimum Scope of Insurance Coverage shall be at least as broad as: 1. Insurance Services Office ("ISO) Commercial General Liability Coverage Form No. CG 20 10 10 01 and Commercial General Liability Coverage — Completed Operations Form No. CG 20 37 10 01. 2. ISO Form No. CA 0001 (Ed. 1/87) covering Automobile Liability, Code 1 "any auto" or Code 8, 9 if no owned autos and endorsement CA 0025. 3. Worker's Compensation Insurance as required by the Labor Code of the State of California and Employers Liability Insurance. 4. Errors and Omissions liability insurance appropriate to the consultant's profession. Architects' and engineers' coverage is to be endorsed to include contractual liability. B. Minimum Limits of Insurance Consultant shall maintain limits no less than: 1. General Liability: $1,000,000 combined single limit per occurrence for bodily injury, personal injury and property damage including operations, products and completed operations. If Commercial General Liability Insurance or other form with a general aggregate limit is used, the general aggregate limit shall apply separately to the work performed under this Agreement, or the aggregate limit shall be twice the prescribed per occurrence limit. 2. Automobile Liability: $1,000,000 combined single limit per accident for bodily injury and property damage. Contract 1920-196 — Reed Group — Water Rate Study PAGE 3 OF 7 CONTRACT #1920196 3. Worker's Compensation and Employers Liability: Worker's compensation limits as required by the Labor Code of the State of California and Employers Liability limits of $1,000,000 per accident. 4. Errors and Omissions liability: $1,000,000 per occurrence. C. Deductibles and Self -Insured Retentions Any deductibles or self-insured retentions must be declared to and approved by the City. At the option of the City, either the insurer shall reduce or eliminate such deductibles or self-insured retentions as respects to the City, its officers, officials, employees and volunteers; or the Consultant shall procure a bond guaranteeing payment of losses and related investigations, claim administration and defense expenses. D. Other Insurance Provisions The policies are to contain, or be endorsed to contain, the following provisions: 1. General Liability and Automobile Liability Coverages a. The City, it officers, officials, employees and volunteers are to be covered as additional insureds as respects; liability arising out of activities performed by or on behalf of the Consultant, products and completed operations of the Consultant, premises owned, occupied or used by the Consultant, or automobiles owned, hired or borrowed by the Consultant for the full period of time allowed by law, surviving the termination of this Agreement. The coverage shall contain no special limitations on the scope -of -protection afforded to the City, its officers, officials, employees or volunteers. b. The Consultant's insurance coverage shall be primary insurance as respects to the City, its officers, officials, employees and volunteers. Any insurance or self-insurance maintained by the City, its officers, officials, employees or volunteers shall be in excess of the Consultant's insurance and shall not contribute with it. c. Any failure to comply with reporting provisions of the policies shall not affect coverage provided to the City, its officers, officials, employees or volunteers. d. The Consultant's insurance shall apply separately to each insured against whom claim is made or suit is brought, except with respect to the limits of the insurer's liability. 2. Worker's Compensation and Employers Liability Coverage The insurer shall agree to waive all rights of subrogation against the City, its officers, officials, employees and volunteers for losses arising from Consultant's performance of the work, pursuant to this Agreement. Contract 1920-196 — Reed Group — Water Rate Stud} PAGE 4 OF 7 CONTRACT #1920196 3. Professional Liability Coverage If written on a claims -made basis, the retroactivity date shall be the effective date of this Agreement. The policy period shall extend one year from date of final approved invoice for this project. 4. All Coverages Each Insurance policy required by this clause shall be endorsed to state that coverage shall not be suspended, voided, canceled by either party, reduced in coverage or in limits except after thirty (30) days prior written notice by certified mail, return receipt requested, has been given to the City. E. Acceptability of Insurers Insurance is to be placed with admitted California insurers with an A.M. Best's rating of no less than A- for financial strength, AA for long-term credit rating and AMB -1 for short-term credit rating. F. Verification of Coverage Consultant shall furnish the City with Certificates of Insurance and with original Endorsements effecting coverage required by this Agreement. The Certificates and Endorsements for each insurance policy are to be signed by a person authorized by that insurer to bind coverage on its behalf. The Certificates and Endorsements are to be on forms provided or approved by the City. Where by statute, the City's Workers' Compensation - related forms cannot be used, equivalent forms approved by the Insurance Commissioner are to be substituted. All Certificates and Endorsements are to be received and approved by the City before Consultant begins the work of this Agreement. The City reserves the right to require complete, certified copies of all required insurance policies, at any time. If Consultant fails to provide the coverages required herein, the City shall have the right, but not the obligation, to purchase any or all of them. In that event, the cost of insurance becomes part of the compensation due the contractor after notice to Consultant that City has paid the premium. G. Subcontractors Consultant shall include all subcontractors or sub -consultants as insured under its policies or shall furnish separate certificates and endorsements for each sub- contractor or sub -consultant. All coverage for sub -contractors or sub -consultants shall be subject to all insurance requirements set forth in this Paragraph 6.1. 6.2 Indemnification. Notwithstanding the foregoing insurance requirements, and in addition thereto, Consultant agrees, for the full period of time allowed by law, surviving the termination of this Agreement, to indemnify the City for any claim, cost or liability that arises out of, or pertains to, or relates to any negligent act or omission or the willful misconduct of Consultant in the performance of services under this contract by Consultant, but this indemnity does not apply to liability for damages for death or bodily injury to persons, injury to property, or other loss, arising from the sole negligence, willful misconduct or defects in design by the City, or arising from the active negligence of the City. Contract 1920-196 — Reed Group — Water Rate Study PAGE 5 OF 7 CONTRACT #1920196 "Indemnify," as used herein includes the expenses of defending against a claim and the payment of any settlement or judgment arising out of the claim. Defense costs include all costs associated with defending the claim, including, but not limited to, the fees of attorneys, investigators, consultants, experts and expert witnesses, and litigation expenses. References in this paragraph to City or Consultant, include their officers, employees, agents, and subcontractors. 7.0 CONTRACT PROVISIONS 7.1 Ownership of Work. All documents furnished to Consultant by City and all documents or reports and supportive data prepared by Consultant under this Agreement are owned and become the property of the City upon their creation and shall be given to City immediately upon demand and at the completion of Consultant's services at no additional cost to City. Deliverables are identified in the Scope -of -Work, Attachment A. All documents produced by Consultant shall be furnished to City in digital format and hardcopy. Consultant shall produce the digital format, using software and media approved by City. 7.2 Governing Law. Consultant shall comply with the laws and regulations of the United States, the State of California, and all local governments having jurisdiction over this Agreement. The interpretation and enforcement of this Agreement shall be governed by California law and any action arising under or in connection with this Agreement must be filed in a Court of competent jurisdiction in Mendocino County. 7.3 Entire Agreement. This Agreement plus its Attachment(s) and executed Amendments set forth the entire understanding between the parties. 7.4 Severability. If any term of this Agreement is held invalid by a court of competent jurisdiction, the remainder of this Agreement shall remain in effect. 7.5 Modification. No modification of this Agreement is valid unless made with the agreement of both parties in writing. 7.6 Assignment. Consultant's services are considered unique and personal. Consultant shall not assign, transfer, or sub -contract its interest or obligation under all or any portion of this Agreement without City's prior written consent. 7.7 Waiver. No waiver of a breach of any covenant, term, or condition of this Agreement shall be a waiver of any other or subsequent breach of the same or any other covenant, term or condition or a waiver of the covenant, term or condition itself. 7.8 Termination. This Agreement may only be terminated by either party: 1) for breach of the Agreement; 2) because funds are no longer available to pay Consultant for services provided under this Agreement; or 3) City has abandoned and does not wish to complete the project for which Consultant was retained. A party shall notify the other party of any alleged breach of the Agreement and of the action required to cure the breach. If the breaching party fails to cure the breach within the time specified in the notice, the contract shall be terminated as of that time. If terminated for lack of funds or abandonment of the project, the contract shall terminate on the date notice of termination is given to Consultant. City shall pay the Consultant only for services Contract 1920-196 — Reed Group — Water Rate Stud) PAGE 6 OF 7 CONTRACT #1920196 performed and expenses incurred as of the effective termination date. In such event, as a condition to payment, Consultant shall provide to City all finished or unfinished documents, data, studies, surveys, drawings, maps, models, photographs and reports prepared by the Consultant under this Agreement. Consultant shall be entitled to receive just and equitable compensation for any work satisfactorily completed hereunder, subject to off -set for any direct or consequential damages City may incur as a result of Consultant's breach of contract. 7.9 Execution of Agreement. This Agreement may be executed in duplicate originals, each bearing the original signature of the parties. Alternatively, this Agreement may be executed and delivered by facsimile or other electronic transmission, and in more than one counterpart, each of which shall be deemed an original, and all of which together shall constitute one and the same instrument. When executed using either alternative. the executed agreement shall be deemed an original admissible as evidence in any administrative or judicial proceeding to prove the terms and content of this Agreement. 8.0 NOTICES Any notice given under this Agreement shall be in writing and deemed given when personally delivered or deposited in the mail (certified or registered) addressed to the parties as follows: CITY OF UKIAH DEPT. OF FINANCE 300 SEMINARY AVENUE UKIAH, CALIFORNIA 95482-5400 THE REED GROUP, INC. ROBERT REED 3053 FREEPORT BOULEVARD, #158 SACRAMENTO, CALIFORNIA 95818-4346 9.0 SIGNATURES IN WITNESS WHEREOF, the parties have executed this Agreement the Effective Date: THE REED GROUP, INC. BY: NKIN I NAME: ‘P:5be r ocean �i�f-�3�38'Iy IRS IDN Number CITY OF UKIAH BY: 5:1 GEMIA NGIACOMO Date CITY NAGER ATTEST katt, 1/7-0/ZZ Date 1 -;Ls -�t(Y CITY CLERK Date Contact 1920-196 - Reed Gawp — Water Rate Study PAGE 7 OF 7 c ATTACHMENT A THE REED GROUP, INC. December 19, 2019 Sean White City of Ukiah 300 Seminary Ave Ukiah, CA 95482 Subject: Proposal to Prepare Water Rate Study Dear Sean, In response to your request, The Reed Group, Inc. is pleased to offer assistance to the City of Ukiah in preparing a water rate study. This proposal letter includes a scope of services, schedule, cost estimate, and an initial information request for the study based on our recent telephone conversation. As you know, The Reed Group completed a water rate study in February 2016. Annual rate adjustments were adopted at that time through January 2020. This study is intended to update the financial plan for the water utility and develop recommendations for water rate adjustments for the next five years. One focus of the study will be to examine the financial impacts of the City's recycled water program, including potential financing of Phase 4 of the program. The study described herein includes the technical and financial analysis for preparing a new 10 - year financial plan for the water utility, including recycled water costs and related financing. The study also includes (1) a presentation to the City Council prior to the Proposition 218 notification process, and (2) a presentation during a public hearing to consider proposed water rates. If necessary, the study scope and schedule could be modified to accommodate any additional needs of the City. Scope of Services The City of Ukiah currently adjusts its water rates annually based on recommendations made during the 2016 water rate study. At that time, a five-year rate plan was adopted by the City. The last of the annual rate adjustments is scheduled for January 2020. The timing is appropriate for a review of the financial condition of the water utility and an update of the water rates, with consideration of a new five-year rate plan. Water rates must generate sufficient revenues to meet the utility's operation and maintenance needs, debt service obligations, and capital program needs with consideration for other revenue sources and financial reserves and reserve policies. As with past studies, the water rate study will also need to be sensitive to the concerns of the community. 3053 Freeport Boulevard #158 • Sacramento, CA 95818-4346 • (916) 444-9622 (&) SEAN WHIM DECEMBER 19, 2019 PAGE 2 Specific tasks for the water rate study include: • Project Initiation and Management - Includes kick-off meeting and up to 2 interim meetings with staff, contract administration, and coordination and communication with the City. Meetings with staff may be conducted via conference call. In particular, we will use the kick-off meeting to review project scope, overall schedule, and initial data and information needs. This proposal letter includes an initial data and information request. During the kick-off meeting, we will review the request, and also discuss the issues that will be central to the study. • Develop 10 -Year Financial Plan - The financial plan will include consideration of annual operating and maintenance costs, current and potential future debt service obligations, capital improvement needs, prudent reserves, and revenues to the water utility. The financial plan will be used to (1) develop a financial strategy for meeting capital improvement needs of the utility, and (2) identify the annual water rate revenues requirement. The financial strategy may include consideration of debt financing of capital projects and, if necessary, estimation of the size and timing of debt issuance. We will also consider how reserve policies might help to reduce financial risk, reduce the need for future debt, and moderate annual rate adjustments. The revenue requirement is the amount needed to meet financial obligations and goals with consideration of reserves and reserve policies. Specific recommendations for establishing and maintaining operating and capital replacement reserves will be developed as part of this study. • Cost of Service Analysis and Rate Calculations - This task will include cost of service analyses and calculation of water rates. We will follow the requirements of Proposition 218 in determining water rates and in proportionately allocating costs to each customer. Rate analyses will be consistent with meeting the revenue needs identified through the financial plan. Changes to the current water rate structure are not contemplated at this time. • Prepare and Present Draft Rate Study Report - Draft recommendations on the financial plan and water rates will be documented in a draft report including all underlying assumptions, proposed financial strategy, cost allocations, rate calculations, and policy recommendations. Draft recommendations will be presented to the City Council during a regular council meeting or in a workshop setting. This will provide an opportunity to describe how each of the key issues identified for this project were addressed and resolved, as well as provide an opportunity to address public comments and questions before the formal rate adoption process begins. • Finalize Rate Study and Recommendations - Based on comments and direction received from staff and the City Council financial and rate analyses will be refined, as necessary, and study recommendations finalized. We will also work with City staff to prepare required public hearing notice in compliance with Proposition 218. This notice must be mailed to all customers/property owners at least 45 days prior to a public hearing. 41)1 SEAN WI -HTE DECEMBER 19, 2019 PAGE 3 • Presentation and Rate Hearing - The Reed Group will present final study recommendations to the City Council during a public hearing to consider new water rates for adoption. Cost and Schedule It is estimated that water financial plan and rate study can be performed for $32,100, including expenses. It is our practice to bill clients monthly for actual time and expenses, subject to the not - to -exceed limit of the study. Payments are due within 30 days. My hourly billing rate for this study is $300. Assistance with the rate study will be provided by Mark Hildebrand, of Hildebrand Consulting, LLC. His hourly billing rate is $210. Expenses are estimated at about $600 (primarily for travel). All work products will be submitted in electronic format (primarily PDF files). An initial timeline for the project is listed below, assuming that the study begins by early January. The timeline will be reviewed and, if necessary, adjusted during the kick-off meeting for the project. The proposed timeline would enable the City to adopt new water rates before the end of the current fiscal year. Kick-off meeting Early January Financial plan development January Water rate calculations February Draft report February Presentation to City Council Early March Finalize Report & Mail Notice of Public Hearings Late March Public Hearing on Water Rates Early May The schedule for the water rate study can be adjusted to meet the City's needs. We will work closely with City staff to ensure that the City's needs are addressed throughout the study. Initial Data and Information Request The following items related to the City's water utility will be needed to perform the water rate study. We may request additional information as the study proceeds. • Actual FY 18-19 revenues and expenses in the same level of detail as the budget • Budgeted FY 19-20 revenues and expenses • Fund/reserve balances as of June 30, 2019 • Multi-year capital improvement plan for the water system • Existing debt service schedules and related coverage requirements • Information pertaining to the City's recycled water program including, to the extent available: T 165) SEAN WHITE DECEMBER 19, 2019 PAGE 4 o Past and anticipated capital program costs associated with recycled water facilities o Operating and maintenance costs o List of recycled water customers, including account name, account number, and recent (or projected future) recycled water demand and meter sizes o Anticipated financing for Phase 4 o Any relevant information on issues/policies pertaining to recycled water from both water utility and sewer utility perspectives • Current water rate and connection fee schedules Because we are currently working on the City's and UVSD's wastewater rates, we have recent utility billing data. At this point, we are assuming that we can extract needed water billing information from that data. Also, we will develop the water financial plan with the same growth, interest, and inflation assumptions as used in the wastewater rate study. These topics will be discussed during the kick-off meeting. Please let me know if you have any questions regarding this proposal. We appreciate the opportunity to be of continued service to the City of Ukiah. Sincerely, C -1?_.„. -C Robert Reed The Reed Group, Inc.