HomeMy WebLinkAboutC-6094 - PSA for Contract Compliance AuditCCo
PROFESSIONAL SERVICES AGREEMENT
WITH SJOBERG EVASHENK CONSULTING, INC. FOR
CONTRACT COMPLIANCE AUDIT
THIS PROFESSIONAL SERVICES AGREEMENT ("Agreement") is made and
entered into as of this 13th day of April, 2015 ("Effective Date'), by and between the
CITY OF NEWPORT BEACH, a California municipal corporation and charter city
("City"), and SJOBERG EVASHENK CONSULTING, INC., a California corporation
("Consultant"), whose address is 455 Capitol Mall, Suite 700, Sacramento, California
95814, and is made with reference to the following:
RECITALS
A. City is a municipal corporation duly organized and validly existing under the laws
of the State of California with the power to carry on its business as it is now being
conducted under the statutes of the State of California and the Charter of City.
B. City desires to engage Consultant to conduct a contract compliance audit
("Project').
C. Consultant possesses the skill, experience, ability, background, certification and
knowledge to provide the professional services described in this Agreement.
D. City has solicited and received a proposal from Consultant, has reviewed the
previous experience and evaluated the expertise of Consultant, and desires to
retain Consultant to render professional services under the terms and conditions
set forth in this Agreement.
NOW, THEREFORE, it is mutually agreed by and between the undersigned
parties as follows:
1. TERM
The term of this Agreement shall commence on the Effective Date, and shall
terminate on June 30, 2015, unless terminated earlier as set forth herein.
2. SERVICES TO BE PERFORMED
Consultant shall diligently perform all the services described in the Scope of
Services attached hereto as Exhibit A and incorporated herein by reference ("Services"
or "Work"). City may elect to delete certain Services within the Scope of Services at its
sole discretion.
3. TIME OF PERFORMANCE
3.1 Time is of the essence in the performance of Services under this
Agreement and Consultant shall perform the Services in accordance with the schedule
included in Exhibit A. In the absence of a specific schedule, the Services shall be
performed to completion in a diligent and timely manner. The failure by Consultant to
strictly adhere to the schedule set forth in Exhibit A, if any, or perform the Services in a
diligent and timely manner may result in termination of this Agreement by City.
3.2 Notwithstanding the foregoing, Consultant shall not be responsible for
delays due to causes beyond Consultant's reasonable control. However, in the case of
any such delay in the Services to be provided for the Project, each party hereby agrees
to provide notice within two (2) calendar days of the occurrence causing the delay to the
other party so that all delays can be addressed.
3.3 Consultant shall submit all requests for extensions of time for performance
in writing to the Project Administrator as defined herein not later than ten (10) calendar
days after the start of the condition that purportedly causes a delay. The Project
Administrator shall review all such requests and may grant reasonable time extensions
for unforeseeable delays that are beyond Consultant's control.
3.4 For all time periods not specifically set forth herein, Consultant shall
respond in the most expedient and appropriate manner under the circumstances, by
hand -delivery or mail.
4. COMPENSATION TO CONSULTANT
4.1 City shall pay Consultant for the Services on a time and expense not -to -
exceed basis in accordance with the provisions of this Section and the Schedule of
Billing Rates attached hereto as Exhibit B and incorporated herein by reference.
Consultant's compensation for all Work performed in accordance with this Agreement,
including all reimbursable items and subconsultant fees, shall not exceed Seven
Thousand Dollars and 00/100 ($7,000.00), without prior written authorization from
City. No billing rate changes shall be made during the term of this Agreement without
the prior written approval of City.
4.2 Consultant shall submit monthly invoices to City describing the Work
performed the preceding month. Consultant's bills shall include the name of the person
who performed the Work, a brief description of the Services performed and/or the
specific task in the Scope of Services to which it relates, the date the Services were
performed, the number of hours spent on all Work billed on an hourly basis, and a
description of any reimbursable expenditures. City shall pay Consultant no later than
thirty (30) calendar days after approval of the monthly invoice by City staff.
4.3 City shall reimburse Consultant only for those costs or expenses
specifically identified in Exhibit B to this Agreement or specifically approved in writing in
advance by City.
4.4 Consultant shall not receive any compensation for Extra Work performed
without the prior written authorization of City. As used herein, "Extra Work" means any
Work that is determined by City to be necessary for the proper completion of the
Project, but which is not included within the Scope of Services and which the parties did
not reasonably anticipate would be necessary at the execution of this Agreement.
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Compensation for any authorized Extra Work shall be paid in accordance with the
Schedule of Billing Rates as set forth in Exhibit B.
5. PROJECT MANAGER
5.1 Consultant shall designate a Project Manager, who shall coordinate all
phases of the Project. This Project Manager shall be available to City at all reasonable
times during the Agreement term. Consultant has designated Marianne P. Evashenk,
President, to be its Project Manager. Consultant shall not remove or reassign the
Project Manager or any personnel listed in Exhibit A or assign any new or replacement
personnel to the Project without the prior written consent of City. City's approval shall
not be unreasonably withheld with respect to the removal or assignment of non -key
personnel.
5.2 Consultant, at the sole discretion of City, shall remove from the Project
any of its personnel assigned to the performance of Services upon written request of
City. Consultant warrants that it will continuously furnish the necessary personnel to
complete the Project on a timely basis as contemplated by this Agreement.
5.3 If Consultant is performing inspection services for City, the Project
Manager and any other assigned staff shall be equipped with a cellular phone to
communicate with City staff. The Project Manager's cellular phone number shall be
provided to City.
6. ADMINISTRATION
This Agreement will be administered by the Finance Department. City's Finance
Director or designee shall be the Project Administrator and shall have the authority to
act for City under this Agreement. The Project Administrator shall represent City in all
matters pertaining to the Services to be rendered pursuant to this Agreement.
7. CITY'S RESPONSIBILITIES
To assist Consultant in the execution of its responsibilities under this Agreement,
City agrees to provide access to and upon request of Consultant, one copy of all
existing relevant information on file at City. City will provide all such materials in a
timely manner so as not to cause delays in Consultant's Work schedule.
8. STANDARD OF CARE
8.1 All of the Services shall be performed by Consultant or under Consultant's
supervision. Consultant represents that it possesses the professional and technical
personnel required to perform the Services required by this Agreement, and that it will
perform all Services in a manner commensurate with the highest professional
standards. For purposes of this Agreement, the phrase "highest professional
standards" shall mean those standards of practice recognized by one (1) or more first-
class firms performing similar work under similar circumstances.
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8.2 All Services shall be performed by qualified and experienced personnel
who are not employed by City. By delivery of completed Work, Consultant certifies that
the Work conforms to the requirements of this Agreement, all applicable federal, state
and local laws, and the highest professional standard.
8.3 Consultant represents and warrants to City that it has, shall obtain, and
shall keep in full force and effect during the term hereof, at its sole cost and expense, all
licenses, permits, qualifications, insurance and approvals of whatsoever nature that is
legally required of Consultant to practice its profession. Consultant shall maintain a City
of Newport Beach business license during the term of this Agreement.
8.4 Consultant shall not be responsible for delay, nor shall Consultant be
responsible for damages or be in default or deemed to be in default by reason of strikes,
lockouts, accidents, acts of God, or the failure of City to furnish timely information or to
approve or disapprove Consultant's Work promptly, or delay or faulty performance by
City, contractors, or governmental agencies.
9. HOLD HARMLESS
9.1 To the fullest extent permitted by law, Consultant shall indemnify, defend
and hold harmless City, its City Council, boards and commissions, officers, agents,
volunteers and employees (collectively, the "Indemnified Parties") from and against any
and all claims (including, without limitation, claims for bodily injury, death or damage to
property), demands, obligations, damages, actions, causes of action, suits, losses,
judgments, fines, penalties, liabilities, costs and expenses (including, without limitation,
attorneys' fees, disbursements and court costs) of every kind and nature whatsoever
(individually, a Claim; collectively, "Claims"), which may arise from or in any manner
relate (directly or indirectly) to any breach of the terms and conditions of this
Agreement, any Work performed or Services provided under this Agreement including,
without limitation, defects in workmanship or materials or Consultant's presence or
activities conducted on the Project (including the negligent, reckless, and/or willful acts,
errors and/or omissions of Consultant, its principals, officers, agents, employees,
vendors, suppliers, consultants, subcontractors, anyone employed directly or indirectly
by any of them or for whose acts they may be liable, or any or all of them).
9.2 Notwithstanding the foregoing, nothing herein shall be construed to
require Consultant to indemnify the Indemnified Parties from any Claim arising from the
sole negligence or willful misconduct of the Indemnified Parties. Nothing in this
indemnity shall be construed as authorizing any award of attorneys' fees in any action
on or to enforce the terms of this Agreement. This indemnity shall apply to all claims
and liability regardless of whether any insurance policies are applicable. The policy
limits do not act as a limitation upon the amount of indemnification to be provided by
Consultant.
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10. INDEPENDENT CONTRACTOR
It is understood that City retains Consultant on an independent contractor basis
and Consultant is not an agent or employee of City. The manner and means of
conducting the Work are under the control of Consultant, except to the extent they are
limited by statute, rule or regulation and the expressed terms of this Agreement. No
civil service status or other right of employment shall accrue to Consultant or its
employees. Nothing in this Agreement shall be deemed to constitute approval for
Consultant or any of Consultant's employees or agents, to be the agents or employees
of City. Consultant shall have the responsibility for and control over the means of
performing the Work, provided that Consultant is in compliance with the terms of this
Agreement. Anything in this Agreement that may appear to give City the right to direct
Consultant as to the details of the performance of the Work or to exercise a measure of
control over Consultant shall mean only that Consultant shall follow the desires of City
with respect to the results of the Services.
11. COOPERATION
Consultant agrees to work closely and cooperate fully with City's designated
Project Administrator and any other agencies that may have jurisdiction or interest in the
Work to be performed. City agrees to cooperate with the Consultant on the Project.
12. CITY POLICY
Consultant shall discuss and review all matters relating to policy and Project
direction with City's Project Administrator in advance of all critical decision points in
order to ensure the Project proceeds in a manner consistent with City goals and
policies.
13. PROGRESS
Consultant is responsible for keeping the Project Administrator informed on a
regular basis regarding the status and progress of the Project, activities performed and
planned, and any meetings that have been scheduled or are desired.
14. INSURANCE
Without limiting Consultant's indemnification of City, and prior to commencement
of Work, Consultant shall obtain, provide and maintain at its own expense during the
term of this Agreement or for other periods as specified in this Agreement, policies of
insurance of the type, amounts, terms and conditions described in the Insurance
Requirements attached hereto as Exhibit C, and incorporated herein by reference.
15. PROHIBITION AGAINST ASSIGNMENTS AND TRANSFERS
Except as specifically authorized under this Agreement, the Services to be
provided under this Agreement shall not be assigned, transferred contracted or
subcontracted out without the prior written approval of City. Any of the following shall
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be construed as an assignment: The sale, assignment, transfer or other disposition of
any of the issued and outstanding capital stock of Consultant, or of the interest of any
general partner or joint venturer or syndicate member or cotenant if Consultant is a
partnership or joint -venture or syndicate or co -tenancy, which shall result in changing
the control of Consultant. Control means fifty percent (50%) or more of the voting
power or twenty-five percent (25%) or more of the assets of the corporation, partnership
or joint -venture.
16. SUBCONTRACTING
The subcontractors authorized by City, if any, to perform Work on this Project are
identified in Exhibit A. Consultant shall be fully responsible to City for all acts and
omissions of any subcontractor. Nothing in this Agreement shall create any contractual
relationship between City and any subcontractor nor shall it create any obligation on the
part of City to pay or to see to the payment of any monies due to any such
subcontractor other than as otherwise required by law. City is an intended beneficiary
of any Work performed by the subcontractor for purposes of establishing a duty of care
between the subcontractor and City. Except as specifically authorized herein, the
Services to be provided under this Agreement shall not be otherwise assigned,
transferred, contracted or subcontracted out without the prior written approval of City.
17. OWNERSHIP OF DOCUMENTS
17.1 Each and every report, draft, map, record, plan, document and other
writing produced, including but not limited to, websites, blogs, social media accounts
and applications (hereinafter "Documents"), prepared or caused to be prepared by
Consultant, its officers, employees, agents and subcontractors, in the course of
implementing this Agreement, shall become the exclusive property of City, and City
shall have the sole right to use such materials in its discretion without further
compensation to Consultant or any other party. Additionally, all material posted in
cyberspace by Consultant, its officers, employees, agents and subcontractors, in the
course of implementing this Agreement, shall become the exclusive property of City,
and City shall have the sole right to use such materials in its discretion without further
compensation to Consultant or any other party. Consultant shall, at Consultant's
expense, provide such Documents, including all logins and password information to City
upon prior written request.
17.2 Documents, including drawings and specifications, prepared by
Consultant pursuant to this Agreement are not intended or represented to be suitable
for reuse by City or others on any other project. Any use of completed Documents for
other projects and any use of incomplete Documents without specific written
authorization from Consultant will be at City's sole risk and without liability to
Consultant. Further, any and all liability arising out of changes made to Consultant's
deliverables under this Agreement by City or persons other than Consultant is waived
against Consultant, and City assumes full responsibility for such changes unless City
has given Consultant prior notice and has received from Consultant written consent for
such changes.
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17.3 All written documents shall be transmitted to City in formats compatible
with Microsoft Office and/or viewable with Adobe Acrobat.
18. CONFIDENTIALITY
All Documents, including drafts, preliminary drawings or plans, notes and
communications that result from the Services in this Agreement, shall be kept
confidential unless City expressly authorizes in writing the release of information.
19. INTELLECTUAL PROPERTY INDEMNITY
Consultant shall defend and indemnify City, its agents, officers, representatives
and employees against any and all liability, including costs, for infringement or alleged
infringement of any United States' letters patent, trademark, or copyright, including
costs, contained in Consultant's Documents provided under this Agreement.
20. RECORDS
Consultant shall keep records and invoices in connection with the Services to be
performed under this Agreement. Consultant shall maintain complete and accurate
records with respect to the costs incurred under this Agreement and any Services,
expenditures and disbursements charged to City, for a minimum period of three (3)
years, or for any longer period required by law, from the date of final payment to
Consultant under this Agreement. All such records and invoices shall be clearly
identifiable. Consultant shall allow a representative of City to examine, audit and make
transcripts or copies of such records and invoices during regular business hours.
Consultant shall allow inspection of all Work, data, Documents, proceedings and
activities related to the Agreement for a period of three (3) years from the date of final
payment to Consultant under this Agreement.
21. WITHHOLDINGS
City may withhold payment to Consultant of any disputed sums until satisfaction
of the dispute with respect to such payment. Such withholding shall not be deemed to
constitute a failure to pay according to the terms of this Agreement. Consultant shall
not discontinue Work as a result of such withholding. Consultant shall have an
immediate right to appeal to the City Manager or designee with respect to such disputed
sums. Consultant shall be entitled to receive interest on any withheld sums at the rate of
return that City earned on its investments during the time period, from the date of
withholding of any amounts found to have been improperly withheld.
22. ERRORS AND OMISSIONS
In the event of errors or omissions that are due to the negligence or professional
inexperience of Consultant which result in expense to City greater than what would
have resulted if there were not errors or omissions in the Work accomplished by
Consultant, the additional design, construction and/or restoration expense shall be
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borne by Consultant. Nothing in this Section is intended to limit City's rights under the
law or any other sections of this Agreement.
23. CITY'S RIGHT TO EMPLOY OTHER CONSULTANTS
City reserves the right to employ other Consultants in connection with the
Project.
24. CONFLICTS OF INTEREST
24.1 Consultant or its employees may be subject to the provisions of the
California Political Reform Act of 1974 (the "Act"), which (1) requires such persons to
disclose any financial interest that may foreseeably be materially affected by the Work
performed under this Agreement, and (2) prohibits such persons from making, or
participating in making, decisions that will foreseeably financially affect such interest.
24.2 If subject to the Act, Consultant shall conform to all requirements of the
Act. Failure to do so constitutes a material breach and is grounds for immediate
termination of this Agreement by City. Consultant shall indemnify and hold harmless
City for any and all claims for damages resulting from Consultant's violation of this
Section.
25. NOTICES
25.1 All notices, demands, requests or approvals, including any change in
mailing address, to be given under the terms of this Agreement shall be given in writing,
and conclusively shall be deemed served when delivered personally, or on the third
business day after the deposit thereof in the United States mail, postage prepaid, first-
class mail, addressed as hereinafter provided.
25.2 All notices, demands, requests or approvals from Consultant to City shall
be addressed to City at:
Attn: Dan Matusiewicz, Finance Director
Finance Department
City of Newport Beach
100 Civic Center Drive
PO Box 1768
Newport Beach, CA 92658
25.3 All notices, demands, requests or approvals from City to Consultant shall
be addressed to Consultant at:
Attn: Marianne P. Evashenk, President
Sjoberg Evashenk Consulting, Inc.
455 Capitol Mall, Suite 700
Sacramento, CA 95814
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26. CLAIMS
Unless a shorter time is specified elsewhere in this Agreement, before making its
final request for payment under this Agreement, Consultant shall submit to City, in
writing, all claims for compensation under or arising out of this Agreement.
Consultant's acceptance of the final payment shall constitute a waiver of all claims for
compensation under or arising out of this Agreement except those previously made in
writing and identified by Consultant in writing as unsettled at the time of its final request
for payment. Consultant and City expressly agree that in addition to any claims filing
requirements set forth in the Agreement, Consultant shall be required to file any claim
Consultant may have against City in strict conformance with the Government Claims Act
(Government Code sections 900 et seq.).
27. TERMINATION
27.1 In the event that either party fails or refuses to perform any of the
provisions of this Agreement at the time and in the manner required, that party shall be
deemed in default in the performance of this Agreement. If such default is not cured
within a period of two (2) calendar days, or if more than two (2) calendar days are
reasonably required to cure the default and the defaulting party fails to give adequate
assurance of due performance within two (2) calendar days after receipt of written
notice of default, specifying the nature of such default and the steps necessary to cure
such default, and thereafter diligently take steps to cure the default, the non -defaulting
party may terminate the Agreement forthwith by giving to the defaulting party written
notice thereof.
27.2 Notwithstanding the above provisions, City shall have the right, at its sole
and absolute discretion and without cause, of terminating this Agreement at any time by
giving no less than seven (7) calendar days' prior written notice to Consultant. In the
event of termination under this Section, City shall pay Consultant for Services
satisfactorily performed and costs incurred up to the effective date of termination for
which Consultant has not been previously paid. On the effective date of termination,
Consultant shall deliver to City all reports, Documents and other information developed
or accumulated in the performance of this Agreement, whether in draft or final form.
28. STANDARD PROVISIONS
28.1 Recitals. City and Consultant acknowledge that the above Recitals are
true and correct and are hereby incorporated by reference into this Agreement.
28.2 Compliance with all Laws. Consultant shall, at its own cost and expense,
comply with all statutes, ordinances, regulations and requirements of all governmental
entities, including federal, state, county or municipal, whether now in force or hereinafter
enacted. In addition, all Work prepared by Consultant shall conform to applicable City,
county, state and federal laws, rules, regulations and permit requirements and be
subject to approval of the Project Administrator and City.
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28.3 Waiver. A waiver by either party of any breach, of any term, covenant or
condition contained herein shall not be deemed to be a waiver of any subsequent
breach of the same or any other term, covenant or condition contained herein, whether
of the same or a different character.
28.4 Integrated Contract. This Agreement represents the full and complete
understanding of every kind or nature whatsoever between the parties hereto, and all
preliminary negotiations and agreements of whatsoever kind or nature are merged
herein. No verbal agreement or implied covenant shall be held to vary the provisions
herein.
28.5 Conflicts or Inconsistencies. In the event there are any conflicts or
inconsistencies between this Agreement and the Scope of Services or any other
attachments attached hereto, the terms of this Agreement shall govern.
28.6 Interpretation. The terms of this Agreement shall be construed in
accordance with the meaning of the language used and shall not be construed for or
against either party by reason of the authorship of the Agreement or any other rule of
construction which might otherwise apply.
28.7 Amendments. This Agreement may be modified or amended only by a
written document executed by both Consultant and City and approved as to form by the
City Attorney.
28.8 Severability. If any term or portion of this Agreement is held to be invalid,
illegal, or otherwise unenforceable by a court of competent jurisdiction, the remaining
provisions of this Agreement shall continue in full force and effect.
28.9 Controlling Law and Venue. The laws of the State of California shall
govern this Agreement and all matters relating to it and any action brought relating to
this Agreement shall be adjudicated in a court of competent jurisdiction in the County of
Orange, State of California.
28.10 Equal Opportunity Employment. Consultant represents that it is an equal
opportunity employer and it shall not discriminate against any subcontractor, employee
or applicant for employment because of race, religion, color, national origin, handicap,
ancestry, sex, age or any other impermissible basis under law.
28.11 No Attorneys' Fees. In the event of any dispute or legal action arising
under this Agreement, the prevailing party shall not be entitled to attorneys' fees.
28.12 Counterparts. This Agreement may be executed in two (2) or more
counterparts, each of which shall be deemed an original and all of which together shall
constitute one (1) and the same instrument.
[SIGNATURES ON NEXT PAGE]
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date: y/' / 1 S
By:
Aaron arp UM osju1 IS
City Attorney
ATTEST: rL )31/�
Date: '
By: 41� OP
Leilani I. Brown
City Clerk
'ALI FOµ
CITY OF NEWPORT BEACH,
a California municipal corporation
Date:
.1
By:
Da atusiewicz
Finance Director
CONSULTANT: Sjoberg Evashenk
Consulting, Inc., a California corporation
Date:
Signed in Counterpart
By:
Marianne P. Evashenk
President
Date:
Signed in Counterpart
By:
Kurt R. Sjoberg
Vice -President & Corporate Secretary
[END OF SIGNATURES]
Attachments: Exhibit A — Scope of Services
Exhibit B — Schedule of Billing Rates
Exhibit C — Insurance Requirements
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IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed on the dates written below.
APPROVED AS TO FORM:
CITY ATTORNEY'S OFFICE
Date: y/J / 1S
-2
Aaron "arp NM 031r l IS
City Attorney
CITY OF NEWPORT BEACH,
a California municipal corporation
Date:
By:
Dan Matusiewicz
Finance Director
ATTEST:
CONSULTANT: Sjoberg Evashenk
Date:
Consulting, I California corporation
Dater 2.0 'f—
By:
By:
Leilani I. Brown
Ma [ani e P. vashenk
City Clerk
Presi nt
Date:
�By: .
Kurt . Sjoberg
Vice -President & Cor orate Secr ary
[END OF SIGNATURES]
Attachments: Exhibit A – Scope of Services
Exhibit B – Schedule of Billing Rates
Exhibit C – Insurance Requirements
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EXHIBIT A
SCOPE OF SERVICES
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EXHIBIT A— SCOPE OF SERVICES
Sjoberg Evashenk Consulting, Inc. ("Consultant") shall conduct a Contract Compliance Audit
regarding the City's Tree Maintenance Services Contract.
THE PROJECT
The City of Newport Beach ("City") maintains nearly 34,000 trees located on parkways, slopes,
medians, in parks, and at City facilities. Tree maintenance services (pruning, planting and
removals) are performed by contractors overseen by the City's Municipal Operations
Department. The agreement with the current contractor, Great Scott Tree Services (GSTS), was
approved by the City Council on November 12, 2013 for a 10 -year term with option for three
extensions of two years each. During the first year of services, it came to the City's attention
that the services required for tree maintenance may be greater than other years. The City is
interested to determine whether the executed contract aligns with the RFP's scope of work or
whether conditions have changed and a new procurement is warranted. City is retaining
Consultant to review the procurement and provide advice on how to proceed in this situation.
GENERAL APPROACH
Consultant shall conduct interviews and document analysis as to understand and evaluate the
City contract related to the contracted Tree Maintenance Services. Consultant shall conduct
this project on a "stop and go" basis; this Agreement entails a first "phase"; any additional work
on this matter would be negotiated with the City to develop the work plan and additional
budget. Consultant's "work plan" and approach for this "reconnaissance" or "as is" will entail:
• Conduct interviews with relevant City staff.
• Obtain and review the following documents:
o RFP for the procurement
o Responses to the RFP
o Scoring criteria and scoring sheets
o Executed contract with scope of services
o Prior contract for Tree Services
o Relevant policies and procedures for such procurements.
• Analyze these and other relevant materials to determine whether the contract
awarded aligns with the RFP, whether the current situation suggests that the City's
requirements are greater than those expressed in the RFP or under the previous
contract, if the existing contract should remain as is or amended, or if the services
should be re -procured.
DELIVERABLE
Consultant shall conduct this brief reconnaissance to assess the current "condition" and
determine its view of how the City should proceed in this matter. To expedite the process and
EXHIBIT A —SCOPE OF SERVICES
contain the costs, Consultant suggests that the "deliverable" is a bullet point discussion
document conveying what it found and its advice of alternatives going forward. Should a
formal report be necessary, Consultant shall request additional budget and time.
CONSULTANT BACKGROUND
Sjoberg Evashenk Consulting—The Equation for Excellence. This is not only our motto; it is the
way we do business—every day, every project, every effort. We at Sjoberg Evashenk
Consulting have dedicated our careers to improving operations and programs in government
and quasi -government organizations. Important to this project is that Sjoberg Evashenk has
conducted more than 250 audits since our founding in 2000 serving more than 100 state and
local government entities throughout the western United States, including the City of Newport
Beach. Our firm is led by partners Kurt Sjoberg and Marianne Evashenk—former California
State Auditor General and Chief Deputy State Auditor—who bring our clients decades of
experience and expertise in government performance audit, program evaluation, compliance,
contract, financial audit, and many other areas of management consulting. Regardless of the
type of service, our firm's overall consulting philosophy is simple. We strive to deliver more to
our clients than they expect, and do so with unsurpassed quality. Our consulting approach and
rigid quality control procedures ensure that we consistently produce insightful, on -point,
actionable, value-added, and practical solutions—and we do so on-time and on -budget.
Sjoberg Evashenk Consulting offers over 15 years of relevant experience in evaluating
contracting, procurement, compliance, and control environment over governmental and quasi -
government operations. We offer not only audit and evaluation expertise, but bring direct
experience managing and operating governmental organizations as well. We understand the
City's fiduciary position to the public and the duties, roles, responsibilities, challenges and
parameters that these officers, executives, managers and staff must manage within.
Established in 2000, Sjoberg Evashenk Consulting, Inc. is organized as a Sub -Chapter S
Corporation headquartered in Sacramento, California. We are comprised of highly experienced
audit staff all having long tenure with our firm and each bringing advanced educational and
professional credentials. Sjoberg Evashenk Consulting is federally and state recognized
disadvantaged business enterprise—woman-owned, and a California small business "micro"
enterprise.
PROPOSED STAFF
For this engagement, Sjoberg Evashenk offers a small, but highly qualified team. Each member
of the team brings direct experience in conducting performance audits and compliance reviews.
They bring deep expertise in areas of procurement and contracting processes, contract
compliance, and public works.
Marianne Evashenk, CPA, CGFM, CGMA: Project Partner
• George Skiles, MA, CIA, CRMA: Project Manager
Robert Evashenk, BS: Consultant
EXHIBIT A— SCOPE OF SERVICES
Our team will work in concert to conduct this engagement. Mr. Skiles and Mr. Evashenk will
conduct the majority of the on-site fieldwork with Ms. Evashenk superintending and providing
assistance. If the project requires additional team members, we will provide their resumes and
request in writing for the City's approval to add them to the team; unless the scope of the
project changes, costs related to any additions to our team will be absorbed in the budget.
EXHIBIT A– SCOPE OF SERVICES
Marianne P. Evashenk, cofounder and President of
Sjoberg Evashenk Consulting. Ms. Evashenk has
dedicated her career to improvement in
accountability and excellence in government
services. Reviews she has conducted involved all
levels of complexity and entity size at the state and
local levels—isolating and evaluating the fiscal and
operational aspects specific programs, assessing
compliance and service delivery, reviewing business
processes and controls, determining information
flow and integrity, monitoring and reviewing
system's implementation and contracts, and
examining service efforts and accomplishments.
She brings vast experience in areas contract delivery
and the evaluation of related controls and enterprise
risk. Moreover, her projects often entail various
areas and functions of a program or organization
such as structure, personnel and human resource
issues, business cycle forensic analysis,
benchmarking, and monitoring and oversight. Ms.
Evashenk always strives to provide practical,
relevant, timely and practical information and
recommendations to leaders and other decision -
makers.
Examples of pertinent compliance and contract
engagements include:
* Los Angeles World Airports
* California Health Benefits Exchange
* San Francisco City and County -various projects
* Queen Mary lease with City of Long Beach
* City of Newport Beach
* City of Long Beach
* City of Anaheim
* City of Elk Grove
* Judicial Council of California
For more than 7 years, Ms. Evashenk managed the
operations of the California State Auditor. During
this 18 -year career, she participated and managed
literally hundreds of performance, financial, contract,
and compliance audits, as well as managed the
Bureau's investigative hotline.
EXHIBIT A — SCOPE OF SERVICES
George Skiles, manager with Sjoberg Evashenk
Consulting brings more than 15 years'
experience in evaluating programs in the public
and private sector. In this time, he managed
dozens of consulting engagements and
performance audits that encompass a wide
range of government and non-profit operations.
Mr. Skiles has managed or conducted several
performance audits evaluating contracting
practices as they relate to professional services,
construction of capital improvement projects,
memorandums of understanding and
intergovernmental agreements, and purchasing.
He is also familiar with the operating
environment of the City of Los Angeles, having
conducted independent, GAGAS-compliant
audits in the departments of in public works,
water and power, airports, harbor, information
technology, and general services agencies.
Below is a brief list of of related engagements
managed by Mr. Skiles:
Contracting practices in Department of Public
Works, including CIP projects administered by
Bureaus of Sanitation, Street Services, Street
Lighting, and Contract Administration.
Contracting practices at LAWA, including
professional services and construction.
♦ Centre City Development Corporation,
including redevelopment projects and public
works infrastructure projects.
♦ City of Elk Grove's Development Services
Division, including public works, planning, and
building and safety.
♦ Contracting Practices at Department of
Water and Power.
♦ Contracting Practices at the Port of Los
Angeles.
Many of these engagements involved
assessments of contract administration,
contract compliance, scheduling and budget -to -
actual, competitive solicitation activities,
amendments and change orders, benchmarking
and comparisons of existing practices to best or
leading contracting and CIP practices.
EXHIBIT A — SCOPE OF SERVICES
Robert Evashenk is a Staff Consultant with Sjoberg
Evashenk Consulting. Since joining the firm, he has
worked on a number of complex and challenging
projects. Mr. Evashenk has worked on a variety of
engagements and is currently completing work on a
large-scale audit of the San Diego TransNet
transportation program where he is evaluating
financial and contract activities. Mr. Evashenk
recently completed two contractor compliance
reviews relating to parking lot concessions and more
than a dozen reviews of contractor overhead rate
determinations and a third project evaluating the
City of San Francisco's Department of Public Works'
Job Order Contracts program.
He was recently a key team member on the firm's
performance audit of the City of Los Angeles' Fire
Department's Emergency Services billing and
collections activities. This project entails complex
compliance matters relating to two key vendor
contracts—procurement and award, contractor
compliance, and performance sanctions. He also
worked on a comprehensive project to develop
processes, procedures, and oversight of a new $85
million state -level loan guarantee program. This
project is built upon a previous engagement where
he evaluated loan portfolios in compliance with
federal provisions.
Additionally, participated in the review of the LA
Memorial Coliseum Commission, fiscal operations at
the Los Angeles Superior Court, and he was a key
team member on a performance audit for the City of
Elk Grove Police Department as the City's internal
auditor. Recently, he completed two projects with
the San Francisco City Service Auditor, reviewing
contractors' overhead rates from the Municipal
Transportation Agency Central Subway Project.
Further, his team conducted a comprehensive study
of Colorado's College Opportunity Fund program
involving data for thousands of college students over
a ten year period. Finally, among other engagements
he was a team member on the firm's engagement of
the review of Sacramento's Community Services
Department's building permitting processes.
EXHIBIT B
SCHEDULE OF BILLING RATES
Consultant shall conduct the interviews and the document review and analysis within
20-25 hours of work and at a reduced blended billing rate of $175.00 per hour. The
work on this aspect of the project will be conducted by Marianne Evashenk, Partner,
and George Skiles, Manager. It is anticipated that there is no need for additional staff
for this brief assignment.
It is estimated that to complete this phase of the engagement that services costs
will not exceed $5,000.
This engagement can be completed remotely from the Consultant's offices in
Sacramento as most of the effort entails document review and interviews. However, if
coming on site is deemed value-added or if in-person briefings are requested,
Consultant shall be reimbursed for actual travel costs.
Any additional work, as mutually agreed, would be billed at the following:
LEVEL
HOURLY RATE
Partner
$225.00
Manager
$160.00
Consultant
$90.00
Sjoberg Evashenk Consulting, Inc. Page B-1
EXHIBIT C
INSURANCE REQUIREMENTS — PROFESSIONAL SERVICES
1. Provision of Insurance. Without limiting Consultant's indemnification of City, and
prior to commencement of Work, Consultant shall obtain, provide and maintain at
its own expense during the term of this Agreement, policies of insurance of the
type and amounts described below and in a form satisfactory to City. Consultant
agrees to provide insurance in accordance with requirements set forth here. If
Consultant uses existing coverage to comply and that coverage does not meet
these requirements, Consultant agrees to amend, supplement or endorse the
existing coverage.
2. Acceptable Insurers. All insurance policies shall be issued by an insurance
company currently authorized by the Insurance Commissioner to transact
business of insurance in the State of California, with an assigned policyholders'
Rating of A- (or higher) and Financial Size Category Class VII (or larger) in
accordance with the latest edition of Best's Key Rating Guide, unless otherwise
approved by the City's Risk Manager.
3. Coverage Requirements.
A. Workers' Compensation Insurance. Consultant shall maintain Workers'
Compensation Insurance, statutory limits, and Employer's Liability
Insurance with limits of at least one million dollars ($1,000,000) each
accident for bodily injury by accident and each employee for bodily injury
by disease in accordance with the laws of the State of California, Section
3700 of the Labor Code.
Consultant shall submit to City, along with the certificate of insurance, a
Waiver of Subrogation endorsement in favor of City, its officers, agents,
employees and volunteers.
B. General Liability Insurance. Consultant shall maintain commercial general
liability insurance, and if necessary umbrella liability insurance, with
coverage at least as broad as provided by Insurance Services Office form
CG 00 01, in an amount not less than one million dollars ($1,000,000) per
occurrence, two million dollars ($2,000,000) general aggregate. The
policy shall cover liability arising from premises, operations, personal and
advertising injury, and liability assumed under an insured contract
(including the tort liability of another assumed in a business contract).
C. Automobile Liability Insurance. Consultant shall maintain automobile
insurance at least as broad as Insurance Services Office form CA 00 01
covering bodily injury and property damage for all activities of Consultant
arising out of or in connection with Work to be performed under this
Agreement, including coverage for any owned, hired, non -owned or rented
vehicles, in an amount not less than one million dollars ($1,000,000)
combined single limit each accident.
Sjoberg Evashenk Consulting, Inc. Page C-1
D. Professional Liability (Errors & Omissions) Insurance. Consultant shall
maintain professional liability insurance that covers the Services to be
performed in connection with this Agreement, in the minimum amount of
one million dollars ($1,000,000) per claim and two million dollars
($2,000,000) in the aggregate. Any policy inception date, continuity date,
or retroactive date must be before the Effective Date of this Agreement
and Consultant agrees to maintain continuous coverage through a period
no less than three years after completion of the Services required by this
Agreement.
4. Other Insurance Requirements. The policies are to contain, or be endorsed to
contain, the following provisions:
A. Waiver of Subrogation. All insurance coverage maintained or procured
pursuant to this Agreement shall be endorsed to waive subrogation
against City, its elected or appointed officers, agents, officials, employees
and volunteers or shall specifically allow Consultant or others providing
insurance evidence in compliance with these requirements to waive their
right of recovery prior to a loss. Consultant hereby waives its own right of
recovery against City, and shall require similar written express waivers
from each of its subconsultants.
B. Additional Insured Status. All liability policies including general liability,
excess liability, pollution liability, and automobile liability, if required, but
not including professional liability, shall provide or be endorsed to provide
that City and its officers, officials, employees, and agents shall be included
as insureds under such policies.
C. Primary and Non Contributory. All liability coverage shall apply on a
primary basis and shall not require contribution from any insurance or self-
insurance maintained by City.
D. Notice of Cancellation. All policies shall provide City with thirty (30)
calendar days notice of cancellation (except for nonpayment for which ten
(10) calendar days notice is required) or nonrenewal of coverage for each
required coverage.
Additional Agreements Between the Parties. The parties hereby agree to the
following:
A. Evidence of Insurance. Consultant shall provide certificates of insurance
to City as evidence of the insurance coverage required herein, along with
a waiver of subrogation endorsement for workers' compensation and other
endorsements as specified herein for each coverage. Insurance
certificates and endorsement must be approved by City's Risk Manager
prior to commencement of performance. Current certification of insurance
shall be kept on file with City at all times during the term of this
Agreement. City reserves the right to require complete, certified copies of
all required insurance policies, at any time.
Sjoberg Evashenk Consulting, Inc. Page C-2
B. City's Right to Revise Requirements. City reserves the right at any time
during the term of the Agreement to change the amounts and types of
insurance required by giving Consultant sixty (60) calendar days advance
written notice of such change. If such change results in substantial
additional cost to Consultant, City and Consultant may renegotiate
Consultant's compensation.
C. Enforcement of Agreement Provisions. Consultant acknowledges and
agrees that any actual or alleged failure on the part of City to inform
Consultant of non-compliance with any requirement imposes no additional
obligations on City nor does it waive any rights hereunder.
D. Requirements not Limiting. Requirements of specific coverage features
or limits contained in this Section are not intended as a limitation on
coverage, limits or other requirements, or a waiver of any coverage
normally provided by any insurance. Specific reference to a given
coverage feature is for purposes of clarification only as it pertains to a
given issue and is not intended by any party or insured to be all inclusive,
or to the exclusion of other coverage, or a waiver of any type. If the
Consultant maintains higher limits than the minimums shown above, the
City requires and shall be entitled to coverage for higher limits maintained
by the Consultant. Any available insurance proceeds in excess of the
specified minimum limits of insurance and coverage shall be available to
the City.
E. Self-insured Retentions. Any self-insured retentions must be declared to
and approved by City. City reserves the right to require that self-insured
retentions be eliminated, lowered, or replaced by a deductible. Self-
insurance will not be considered to comply with these requirements unless
approved by City.
F. City Remedies for Non -Compliance. If Consultant or any subconsultant
fails to provide and maintain insurance as required herein, then City shall
have the right but not the obligation, to purchase such insurance, to
terminate this Agreement, or to suspend Consultant's right to proceed until
proper evidence of insurance is provided. Any amounts paid by City shall,
at City's sole option, be deducted from amounts payable to Consultant or
reimbursed by Consultant upon demand.
G. Timely Notice of Claims. Contractor shall give City prompt and timely
notice of claims made or suits instituted that arise out of or result from
Contractor's performance under this Contract, and that involve or may
involve coverage under any of the required liability policies. City assumes
no obligation or liability by such notice, but has the right (but not the duty)
to monitor the handling of any such claim or claims if they are likely to
involve City.
H. Consultant's Insurance. Consultant shall also procure and maintain, at its
own cost and expense, any additional kinds of insurance, which in its own
Sjoberg Evashenk Consulting, Inc. Page C-3
judgment may be necessary for its proper protection and prosecution of
the Work.
Sjoberg Evashenk Consulting, Inc. Page C-4
CERTIFICATE OF INSURANCE
CHECKLIST
City of Newport Beach
This checklist is comprised of requirements as outlined by the City of Newport Beach. *
Date Received: 4/3/15 Dept./Contact Received From: Anthony
Date Completed: 4/3/15 Sent to: Anthony By: Chris/Alicia
Company/Person required to have certificate: All Other
Type of contract:
Sjoberg Evashenk Consulting Inc.
I. GENERAL LIABILITY
EFFECTIVE/EXPIRATION DATE: 12/31/14 to 12/31/15
A.
INSURANCE COMPANY: Sentinel Insurance Company
B.
AM BEST RATING (A-: VII or greater): A; XV
C.
ADMITTED Company (Must be Califomia Admitted):
Is Company admitted in California?
N Yes ❑ No
D.
LIMITS (Must be $1 M or greater): What is limit provided?
2M/2M, 2/M/3M-Prof Liab
E.
ADDITIONAL INSURED ENDORSEMENT — please attach
N Yes ❑ No
F.
PRODUCTS AND COMPLETED OPERATIONS (Must
(What is limits provided?)
include): Is it included? (completed Operations status does
F.
PRIMARY & NON-CONTRIBUTORY WORDING (For Waste
not apply to Waste Haulers or Recreation)
N Yes ❑ No
G.
ADDITIONAL INSURED FOR PRODUCTS AND
G.
HIRED AND NON -OWNED AUTO ONLY:
COMPLETED OPERATIONS ENDORSEMENT (completed
H.
NOTICE OF CANCELLATION:
Operations status does not apply to Waste Haulers)
N Yes ❑ No
H.
ADDITIONAL INSURED WORDING TO INCLUDE (The City
its officers, officials, employees and volunteers): Is it
included?
N Yes ❑ No
I.
PRIMARY & NON-CONTRIBUTORY WORDING (Must be
included): Is it included?
N Yes ❑ No
J.
CAUTION! (Confirm that loss or liability of the named insured
is not limited solely by their negligence) Does endorsement
include "solely by negligence' wording?
❑ Yes N No
K.
ELECTED SCMAF COVERAGE (RECREATION ONLY):
N N/A ❑ Yes ❑ No
L.
NOTICE OF CANCELLATION:
❑ N/A N Yes ❑ No
IL AUTOMOBILE LIABILITY
EFFECTIVE/EXPIRATION DATE: 12/31/14 to 12/31/15
A.
INSURANCE COMPANY: Sentinel Insurance Company
B.
AM BEST RATING (A-: VII or greater) A; XV
C.
ADMITTED COMPANY (Must be California Admitted):
Is Company admitted in California?
N Yes ❑ No
D.
LIMITS - If Employees (Must be $1 M min. BI & PD and $500,000
UM, $2M min for Waste Haulers): What is limits provided?
2,000,000
E
LIMITS Waiver of Auto Insurance / Proof of coverage (if individual)
(What is limits provided?)
N/A
F.
PRIMARY & NON-CONTRIBUTORY WORDING (For Waste
Haulers only):
® N/A ❑ Yes ❑ No
G.
HIRED AND NON -OWNED AUTO ONLY:
❑ N/A N Yes ❑ No
H.
NOTICE OF CANCELLATION:
❑ N/A N Yes ❑ No
III. WORKERS' COMPENSATION
EFFECTIVE/EXPIRATION DATE: 12/31/14 to 12/31/15
A.
INSURANCE COMPANY: Sentinel Insurance Company
B.
AM BEST RATING (A-: VII or greater): A; XV
C.
ADMITTED Company (Must be California Admitted):
® Yes
❑ No
D.
WORKERS' COMPENSATION LIMIT: Statutory
® Yes
❑ No
E.
EMPLOYERS' LIABILITY LIMIT (Must be $1M or greater)
1,000,000
F.
WAIVER OF SUBROGATION (To include): Is it included?
® Yes
❑ No
G.
SIGNED WORKERS' COMPENSATION EXEMPTION FORM:
® N/A ❑ Yes
❑ No
H.
NOTICE OF CANCELLATION:
❑ N/A ® Yes
❑ No
ADDITIONAL COVERAGE'S THAT MAYBE REQUIRED
IV. PROFESSIONAL LIABILITY
V POLLUTION LIABILITY
V BUILDERS RISK
HAVE ALL ABOVE REQUIREMENTS BEEN MET?
IF NO, WHICH ITEMS NEED TO BE COMPLETED?
Approved:
Agent of Alliant Insurance Services
Broker of record for the City of Newport Beach
413115
Date
❑ N/A ® Yes ❑ No
® N/A ❑ Yes ❑ No
® NIA ❑ Yes ❑ No
® Yes ❑ No
RISK MANAGEMENT APPROVAL REQUIRED (Non -admitted carrier rated less than _;
Self Insured Retention or Deductible greater than $ ) ❑ N/A ❑ Yes ❑ No
Reason for Risk Management approval/exception/waiver:
Approved:
Risk Management Date
* Subject to the terms of the contract.
J i l,� IIL
June 7, 2012
W. Dan ..4fatusiewiez
Deputy Finance Director
City of Newport Beach
3300 Newport Boulevard
Newport Beach, CA 42663
Dear Mr. Matusiewicz:
Sjoberg Evashenk Consulting is pleased to provide the City of Newport with services to conduct
a generally accepted government auditing standards ("GAGAS")-compliant review related to
two grant agreements between the City of Newport Beach and the Newport Beach Chamber of
Commerce ("Grantee"). The subject grants included in this engagement relate to two City
awards supporting two specific events: $7,200 for the 2011 Taste of Newport, and $30,000 for
2011 Christmas Boar Parade.
The objectives of the grant reviews are to determine whether grant funds were spent solely for
the approved uses as stipulated within the provisions of the agreements. Further, the audit will
assess the Grantee's activities related to support of Political Action Committees ("PACs") during
the last three years and include limited testing and audit procedures to determine whether the
City -sponsored event profits subsidized the funding of PACs and if event proceeds were
appropriately segregated from funds supporting PACs.
The grant agreements include parameters of allowable uses of the grant funds and require that
these City funds be expended solely for the specific purpose. The audit work will assess Grantee
compliance with agreement provisions' including expending the fiords within the stipulated term
of each agreement and the appropriate return to the City of any unused funds. Further, the audit
will determine if grant funds were used for any activity that would violate City, state, or federal
statutory or decisional law (including taxation provisions under Section 501(c) (3) of the Internal
Revenue Code).
'Me City and Sjoberg Evashenk mutually agreed to the following limited scope of work as
follows:
• Evaluate the Grantee's use of the Grant funds for each of the two 201 1 events to
determine how the funds were used and whether such funds were expending on allowable
costs and for purposes relating to the event.
• For each of the two 2011 events, assess the proportion of City -provided funds in relation
to ali revenues and sources for those events to identify the proportion of support and
context of use.
• In relation to the two 2011 events, review payments and in-kind transactions and assess
whether any City grant funds or the proceeds of City -sponsored events were used to
supp*)n PAC and `or lobbying activities, Obtain Grantee managernent assertions related to
PAC andior lobbying activities,
City of Newport
June 7.201 2
Page 2 of 2
• Determine the level and type of support provided by the Grantee for PAC and;'or
lobbying activities over the three fiscal years ending in FY 2011-2012
Sjoberg Evashenk Consulting will maintain open communication and ensure that matters under
audit are discussed with the Grantee, and findings developed and supported by sufficient
evidential matter. The preliminary findings of our audit will be presented in an exit conference
with the Grantee. After the exit conference and our internal quality review, we will provide the
City Finance Director with our written draft report for review and comment. A final draft report
will then be provided to the Grantee for comment and written response. Upon obtaining the
City's approval, we will finalize the audit report and submit it to the City in an agreed to form
and format. Our audit will be conducted in compliance with generally accepted government
auditing standards as promulgated by the U.S. Comptroller General.
As mutually agreed, the City will notify the Grantee of the audit. Upon die execution of this
agreement through signing this letter in the space provided below, Sjoberg Evashenk will contact
the Grantee to set up a mutually agreed to time and date for an entrance conference.
We will provide the City with frequent status reports and expect to deliver the post -exit draft
report to the City within 30-45 days of the entrance conference—schedules of key persons
permitting. Sjoberg Evashenk Consulting will conduct this engagement for five thousand dollars
($5,000). This fixed fee is inclusive of all travel and out-of-pocket expenses. Any testimony
before the City Council or other entities is not included in above fee and will be billed on an
hourly basis at the appropriate hourly rate disclosed in your proposal. Travel and out-of-pocket
expenses associated with any testimony will be reimbursed at cost.
Sjoberg Evashenk looks forward to commencing this important engagement and working closely
with the City. Please do not hesitate to contact me or my partner Kurt Sjoberg if you have any
questions.
Sincerely,
f
Man4ne P. Evashenk, President