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RESOLUTION (ID # 3750) DOC ID: 3750 E
CITY OF SAN BERNARDINO — REQUEST FOR COUNCIL ACTION
Agreement/Contract Amendment
From: Nita McKay M/CC Meeting Date: 03/16/2015
Prepared by: Veronica Martinez, (909)
384-5242
Dept: Finance Ward(s): All
Subject:
Resolution of the Mayor and Common Council of the City of San Bernardino Authorizing
the Execution of Amendment No. 2 to the Agreement for Auditing Services Between the
City of San Bernardino and Macias, Gini & O Connell LLP. (#3750)
Current Business Registration Certificate: Yes
Financial Impact:
Account Budgeted Amount:$436,172 Account No.001-090-0053-5502
Account Description: Professional/Contractual
Balance after approval of this item: $926,172
Motion: Adopt the Resolution.
Synopsis of Previous Council Action:
- 12/15/2014 - Resolution #2014-418 was adopted Authorizing Amendment No. 1
extending the Audit Agreement to perform financial audit services for FY 2013-2014 for
an estimated amount of $218,086.
3/17/2014 - Resolution #2014-57 was adopted Authorizing Audit Services for FY Ending
June 30, 2013 with an estimated amount of $218,086.
2/26/2014 - Audit Committee approved the Proposal from Macias, Gini & O Connell LLP
(MGO) to be taken to the Mayor and Common Council for Approval.
Background:
After completing a formal selection process, the Mayor and Common Council approved
a contract with Macias, Gini and O'Connell, LLP (MGO), Certified Public Accountants to
perform an independent audit of the City's financial records for Fiscal Year Ending June
30, 2013 and Fiscal Year Ending June 30, 2014. The estimated cost when the contract
was executed between the City and MGO was $218,086 for each fiscal year and
included the annual financial statements, Successor Agency financial reports, Single
Audit Report (including 6 major federal grant programs), and Appropriations Limit
review. It should be noted that the originally proposed cost was an estimate at the time
of award of bid. The audit firm is better able to assess the staff time necessary to
complete the audit after they are on site, conduct their internal control testing, determine
the number of major federal grant programs that require more detailed testing and the
Updated: 3/12/2015 by Georgeann "Gigi" Hanna E Packet Pg. 547
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3750
level and magnitude of required testing of accounting transactions.
MGO began the Fiscal Year 2012-13 audit in November 2014. The City has been given
a deadline from the bankruptcy court to submit a Plan of Adjustment by May 30, 2015.
This deadline necessitates that the City have audited beginning numbers to support the
City's Plan and as such, MGO is auditing both fiscal years simultaneously.
Because of the complexity of the City's audits, the City being in Chapter 9 bankruptcy,
the number of transactions that require testing and the tight deadline mandated by the
City of April 30, 2015 for completion of the audit reports, it is now estimated that costs
will increase $270,000 to $488,086 for Fiscal Year 2012-13 and will increase $220,000
to $438,086 for Fiscal Year 2013-14. Staff is recommending that the Mayor and
Common Council adopt the attached resolution amending the contract between the City
of San Bernardino and MGO to reflect the estimated increases in costs to perform the
auditing services.
City Attorney Review:
Supporting Documents:
Resoultion MGO Certified Public Accountants Amendment No 2 (DOCX)
agrmt 3750 (PDF)
Reso 2014-418 Amendment No 1 (PDF)
AMENDMENT NO. 2 TO AUDIT AGREEMENT WITH MACIAS, GINI & O CONNELL
LLP. (MGO) (DOCX)
MGO Svcs Agreement Amendment No 1 (PDF)
Reso 2014-57 Agreement for Auditing Svcs (PDF)
Updated: 3/12/2015 by Georgeann "Gigi" Hanna E Packet Pg. 548
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Q RESOLUTION NO. r
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2 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO AUTHORIZING THE EXECUTION OF AMENDMENT NO. 2 a,
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SAN BERNARDINO AND MACIAS, GINI & O CONNELL L.L.P. (MGO). N
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5 NOW THEREFORE, BE IT RESOLVED BY THE MAYOR AND COMMON
6 COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS:
7 SECTION 1. The City Manager is hereby authorized and directed to execute an Q
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amendment to the Audit Service Agreement between the City of San Bernardino and x
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Macias, Gini & O Connell, LLP, a copy of which is attached hereto and marked Exhibit"A"
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and incorporated herein by reference as fully as though set forth at length.
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12 SECTION 2. The Finance Department is hereby authorized to issue a N
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13 Purchase Order to MGO Certified Public Accountants LLP for Financial Auditing Services for
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14 an estimated amount of$926,172.00. Z
15 SECTION 3. The authorization granted hereunder shall expire and be void and of no
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further effect if the Service Agreement for Financial auditing Services is not completed Q
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within sixty(60) days following the effective date of the Resolution.
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RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
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SAN BERNARDINO AND MACIAS, GINI & O CONNELL L.L.P. (MGO). a
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I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor N
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5 and Common Council of the City of San Bernardino at a meeting
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6 thereof, held on the day of , 2015, by the following vote, to wit:
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Council Members: AYES NAYS ABSTAIN ABSENT a
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18 Georgeann Hanna, City Clerk
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The foregoing Resolution is hereby approved this day of , 2015. a
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R. Carey Davis, Mayor y'
22 City of San Bernardino
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24 GARY D. SAENZ
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AMENDMENT NO. 2 TO CONSULTANT SERVICES AGREEMENT
BETWEEN THE CITY OF SAN BERNARDINO AND
MACIAS, GINI& 0 CONNELL LLP L
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THIS AMENDMENT NO. 2 is made and entered into as of March 16, 2015 by and between the CITY OF
SAN BERNARDDNO, a charter city("City"), and MACIAS, GINI & 0 CONNELL LLP ("CONSULTANT'). In o
consideration of the mutual covenants and conditions set forth herein, the parties agree as follows:
1. This Amendment is made with respect to the following facts and purposes:
a. On March 17, 2014, the City of San Bernardino entered into an Agreement for Auditing Services for
Fiscal Year 2012-2013 for an estimated amount of Two Hundred Eighteen Thousand Eighty Six
($218,086) and authorized a purchase order to the Consultant.
b. On December 15, 2014, the City approved an extension to the agreement to perform financial audit
services for FY 2013-2014 for an estimated amount of$218,086.
c. The parties now desire to amend the agreement and add an additional estimated amount of Two
Hundred Seventy Thousand ($270,000) for FY 2012-2013 and Two Hundred Twenty Thousand Cn
($220,000) for FY 2013-2014 for Audit Services. These Audits will bring the City of San Bernardino
up to date and in line with the bankruptcy plan of adjustment.
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2. Section 2.0 Compensation And Billing of the Agreement is hereby amended to increase the amount .0
that the City agrees to pay the Consultant an amount of Nine Hundred Twenty Six Thousand One
CrHundred Seventy Two ($926,172). City shall pay Consultant for services rendered pursuant to this E
Agreement at the time and in the manner set forth herein. Amendment No. 2 shall be for an amount of L
Nine Hundred Twenty Six Thousand One Hundred Seventy Two ($926,172) for Audit Consultant a
services for the FY 2012-2013 and FY 2013-2014 Audits. °
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3. Except for the changes specifically set forth herein, all other terms and conditions of the Agreement z
shall remain in full force and effect.
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AMENDMENT NO. 2 TO CONSULTANT SERVICES AGREEMENT
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by and through 0
their respective authorized officers, as of the date first above written.
CITY OF SAN BERNARDINO MACIAS, GINI & 0 CONNELL LLP a
A Municipal Corporation Auditors
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Allen J. Parker, City Manager Signature
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RESOLUTION NO. 2014-418
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2 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF
SAN BERNARDINO, AUTHORIZING THE EXECUTION OF AMENDMENT NO. 1
3 TO THE AGREEMENT FOR AUDITING SERVICES BETWEEN THE CITY OF
SAN BERNARIDNO AND MACIAS, GINI & O CONNELL LLP. 3
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5 NOW THEREFORE, BE IT RESOLVED BY THE MAYOR AND COMMON L
6 COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS: Cn
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SECTION 1. The City Manager is hereby authorized and directed to execute an
$ amendment to the Audit Services Agreement between the City of San Bernardino and Macias,
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10 Gini & O Connell, a copy of which is attached hereto marked Exhibit "A" and incorporated
herein by reference as fully as though set forth at length.
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12 SECTION 2. The Finance Department is hereby authorized to issue a Purchase Order N
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13 to Macias, Gini &O Connell for audit services for an estimated total amount of$218,086. Z
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SECTION 3. The authorization granted hereunder shall expire and be void and of no
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further effect if the Agreement for is not executed by both parties and returned to the Office of E
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17 the City Clerk within sixty(60)days following the effective date of this Resolution.
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3 SAN BERNARIDNO AND MACIAS, GINI & O CONNELL LLP. �
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4 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor m
5 and Common Council of the City of San Bernardino at a joint regular meeting thereof, held on >
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the 15th day of December, 2014,by the following vote,to wit: _
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2014-418
AMENDMENT NO. 1 TO CONSULTANT SERVICES AGREEMENT R
BETWEEN THE CITY OF SAN BERNARDINO AND
MACIAS, GINI&0 CONNELL LLP =
THIS AMENDMENT NO. 1 is made and entered into as of December 15,2014 by and between the CITY m
OF SAN BERNARIDNO, (hereinafter referred to as City), and MACIAS, GINI & 0 CONNELL LLP
("CONSULTANT"). In consideration of the mutual covenants and conditions set forth herein,the parties
agree as follows:
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1. This Amendment is made with respect to the following facts and purposes:
a. On March 17, 2014, the City of San Bernardino entered into an Agreement for Auditing Services for a
Fiscal Year 2012-2013 for an estimated amount of Two Hundred Eighteen Thousand Eighty Six 12
($218,086) and authorized a purchase order to the Consultant.
b. The parties now desire to amend the agreement and add an additional estimated amount of Two E
Hundred Eighteen Thousand Eighty Six($218,086)for Audit Services for the additional Fiscal Year
2013-2014. This Audit will bring the City of San Bernardino up to date and in line with the a
bankruptcy plan of action. °
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2. Section 2.0 Compensation And Billing of the Agreement is hereby amended to increase the amount
that the City agrees to pay the Consultant an estimated amount of Two Hundred Eighteen Thousand 0
Eighty Six dollars ($218,086). City shall pay Consultant for services rendered pursuant to this -�
Agreement at the time and in the manner set forth herein. Amendment No. 1 shall be for an estimated
amount of Two Hundred Eighteen Thousand Eighty Six($218,086)for Audit Consultant services for the Q
FY 2013-2014 Audit.
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3. Except for the changes specifically set forth herein, all other terms and conditions of the Agreement w
shall remain in full force and effect, o
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2014-418
AMENDMENT NO. 1 TO CONSULTANT SERVICES AGREEMENT �
BETWEEN THE CITY OF SAN BERNARDINO AND w
MACIAS, GiNI &0 CONNELL LLP
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IN WITNESS WHEREOF,the parties hereto have caused this Agreement to be executed by and through m
their respective authorized officers, as of the date first above written.
CITY OF SAN BERNARDINO MACIAS, GINI &0 CONNELL LLP
A Municipal Corporation Auditors
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Allen J. Park , City Manager Signatu �---`' c
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RESOLUTION NO. 2014-57
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2 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF m
SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT
3 BETWEEN THE CITY OF SAN BERNARDINO AND MACIAS, GINI& O
CONNELL L.L.P. (MGO, CERTIFIED PUBLIC ACCOUNTANTS LLP)FOR THE
4 PROVISION OF FINANCIAL AUDITING SERVICES. co
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6 NOW THEREFORE,BE IT RESOLVED BY THE MAYOR AND COMMON a
COUNCIL OF THE CITY OF SAN BERNARDINO AS FOLLOWS: ,o
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8 SECTION 1. The City Manager is hereby authorized and directed to execute the E
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9 Financial Auditing Service Agreement with MGO Certified Public Accountants LLP, a copy Q
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10 of which is attached and incorporated herein as Exhibit"A". N
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SECTION 2. The Director of Administrative Services is hereby authorized to issue a c
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Purchase Order to MGO Certified Public Accountants LLP for Financial Auditing Services for c
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an estimated amount of$218,086.
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15 SECTION 3. The authorization granted hereunder shall expire and be void and of no
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16 further effect if the Service Agreement for Financial auditing Services is not completed within °
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17 sixty (60)days following the effective date of the Resolution.
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2014-57
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1 RESOLUTION OF THE MAYOR AND COMMON COUNCIL OF THE CITY OF 3
2 SAN BERNARDINO AUTHORIZING THE EXECUTION OF AN AGREEMENT m
BETWEEN THE CITY OF SAN BERNARDINO AND MACIAS, GINI & O d
3 CONNELL L.L.P. (MGO, CERTIFIED PUBLIC ACCOUNTANTS LLP) FOR THE 2
4 PROVISION OF FINANCIAL AUDITING SERVICES. cn
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5 I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the Mayor
6 and Common Council of the City of San Bernardino at a joint regular meeting Q
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7 thereof,held on the 17thday of March , 2014,by the following vote, to wit: a
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9 Council Members: AYES NAYS ABSTAIN ABSENT Q
10 MARQUEZ x N
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George Hanna, ty Clerk
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The foregoing Resolution is hereby approved this day of March 2014. o
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23 R. Car4Dis, May or a,
City of San Bernardino a
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Approved as to form: o
Gary D. Saenz, City Attorney c
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