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Item 10ACity of Southlake, Texas MEMORANDUM April 13, 2005 TO: Shana Yelverton, City Manager FROM: Chuck Kiefer, Interim Deputy City Manager SUBJECT: Department of Public Works Operations Division Management Study. Action Requested: Authorize the City Manager to enter into a professional services agreement with MAXIMUS to conduct a management study of the Department of Public Works Operations Division. Background Information: One of the initiatives of the City Manager's transition plan is to conduct management studies of the larger operating departments to identify opportunities for improved resource utilization. The scope of the study is intended to be comprehensive and the areas of review will include: • Workload and staffing • Organization structure • Management systems • Recruitment and training • Policies and procedures • Use of technology • Fleet and equipment utilization • Comparison of DPW operations to industry best practices • Employee attitudes and morale MAXIMUS has experience conducting management reviews and feasibility studies of Public Works, Utility and Engineering Departments. In addition, MAXIMUS has a long history of service to local governments in Texas. Financial Considerations: The total cost for the management study is $44,000.00. This cost includes all professional fees and travel costs. Financial Impact: The Director of Finance has identified sufficient savings from position vacancies to cover the cost of the study. In addition, prior experience has shown that the cost of such studies is recouped as a result of implementing recommendations which reduce or avoid increases in operating costs. Citizen Input/ Board Review: N /A. Shana Yelverton April 13, 2005 2 Legal Review: Alternatives: Supporting Documents: The attached agreement is currently being reviewed by Debra Drayovitch with TOASE. Alternatives that exist are; (1) Seek another consulting firm, or (2) conduct the study in house. Letter of Agreement between MAXIMUS and the City of Southlake. Staff Recommendation: Authorize the City Manager to enter into a professional services agreement with MAXIMUS to conduct a management study of the Department of Public Works Operations Division. CK Shana Yelverton April 13, 2005 SERVICES AGREEMENT This Services Agreement ( "Agreement ") is effective as of the day of , 20_ ( "Effective Date "), by and between (hereinafter referred to as "Client ") and MAXIMUS, Inc. (hereinafter referred to as "MAXIMUS ") with reference to the following: WHEREAS, Client requires ; and WHEREAS, MAXIMUS has the requisite experience and expertise and is willing to provide such services. NOW, THEREFORE, in consideration of the mutual terms, conditions and covenants set forth herein, the parties agree as follows: SCOPE OF SERVICES Client hereby engages MAXIMUS to perform the services as described in Exhibit A, Scope of Services. During the term of this Agreement Client may request changes in the Scope of Services. Any such change, including any increase or decrease in the amount of MAXIMUS' compensation, requires the mutual agreement of the parties and shall be effective when incorporated by written amendment to this Agreement. 2. COMPENSATION AND METHOD OF PAYMENT Client agrees that compensation and method of payment to MAXIMUS shall be according to Exhibit B, Cost and Fee Schedule. MAXIMUS shall submit monthly invoices to the Client in sufficient detail to support the services provided during the previous month. Client agrees to pay those invoices within thirty (30) days of receipt. In the event the Client disputes a portion of an invoice, the Client agrees to pay the undisputed portion of the invoice within thirty (30) days of receipt and to provide MAXIMUS a detailed statement of the Client's position on the disputed portion of the invoice within thirty (30) days of receipt. Client's failure to pay any amount of an invoice that is not the subject of a good - faith dispute within thirty (30) days of receipt shall entitled MAXIMUS to charge interest on the overdue portion at the lower of 1.5% per month or the highest rate permitted by law. 3. TERM OF CONTRACT This Agreement shall commence as of the Effective Date and shall terminate on 4. RESPONSIBILITIES A. The parties understand and agree that the Client is providing certain personnel resources and facilities to MAXIMUS in connection with selected tasks under this Agreement and MAXIMUS is relying on the availability of such resources. The Client shall provide these resources in a timely manner and represents that the personnel resources are appropriately qualified and capable of performing the assigned tasks. Shana Yelverton April 13, 2005 4 B. MAXIMUS shall document all costs by maintaining complete and accurate records of all financial transactions associated with this Agreement, including, but not limited to, invoices and other official documentation which sufficiently support all charges under this Agreement. C. MAXIMUS shall retain financial, programmatic, client data and other service records for five (5) years from the date services are completed. 5. RIGHTS IN DATA Client shall have a perpetual, nontransferable, paid -up right and license for purposes of its internal business to use, copy, modify and prepare derivative works of the deliverable items developed by MAXIMUS in the course of the services pursuant to this Agreement, whether jointly or individually, subject to the Confidentiality provisions of this Agreement. 6. INDEPENDENT CONTRACTORS A. This Agreement shall not constitute, create, or otherwise imply an employment, joint venture, partnership, agency or similar arrangement, and nothing contained herein shall be construed as providing for the sharing of profits or losses arising from the efforts of either or both of the parties hereto. Each party to this Agreement shall act as an independent contractor, and neither party shall have the power to act for or bind the other party except as expressly provided for herein. MAXIMUS assumes sole responsibility for determining the manner and means of performance hereunder. B. MAXIMUS and its employees shall not be eligible for any benefit available to employees of Client, including, but not limited to, workers compensation insurance, state disability insurance, unemployment insurance, group health and life insurance, vacation pay, sick pay, severance pay, bonus plans, pension plans, savings plans and the like. C. No income, social security, state disability or other federal or state payroll tax shall be deducted from payments made to MAXIMUS under this Agreement. MAXIMUS agrees to pay all state and federal income taxes and other levies and charges as they become due on account of monies paid to MAXIMUS hereunder, and to defend, indemnify and hold Client harmless from and against any and all liability resulting from any failure to do so. D. MAXIMUS' services shall be exempt from State sales, use or similar taxes. However, in the event any such taxes are applicable to this contract, such taxes shall be treated as a reimbursable business expense under the terms of this Agreement. E. MAXIMUS may provide services to others during the same period MAXIMUS provides service to Client under this Agreement. 7. TERMINATION FOR CONVENIENCE This Agreement may be terminated by the Client if all or part of applicable funding becomes unavailable to Client. If applicable funding is reduced, Client may either cancel this Agreement or offer a contract amendment reflecting the reduced funding. If this Agreement is cancelled, Client agrees to reimburse MAXIMUS for all expenditures made in good faith that are unpaid at the time of termination, including all work products completed or in- process, and for the time required to Shana Yelverton April 13, 2005 discontinue onsite activities in an orderly manner, not to exceed the maximum amount payable under this Agreement. 8. TERMINATION FOR DEFAULT Either party shall have the right to terminate this Agreement if the other party is in default of any obligation hereunder and such default is not cured within thirty (30) days of receipt of a notice specifying such default. In the event of such a termination, Client shall reimburse MAXIMUS for all work that had been satisfactorily completed prior to such termination. 9. LIMITATION OF LIABILITY In no event shall MAXIMUS be liable for special, indirect, incidental, economic, consequential or punitive damages, regardless of the legal theory under which such damages are sought, and even if MAXIMUS has been advised of the likelihood of such damages. Client agrees that MAXIMUS total liability to Client or any third party for any and all damages whatsoever arising out of or in any way related to this Agreement from any cause, including but not limited to contract liability or MAXIMUS negligence, errors, omissions, strict liability, breach of contract or breach of warranty shall not, in the aggregate, exceed the fees paid to MAXIMUS hereunder. 10. INSURANCE MAXIMUS shall maintain the following insurance during the term of this Agreement: A. Worker's Compensation and Employer's Liability Insurance in accordance with applicable law. B. Commercial General Liability Insurance on a per occurrence basis with limits of liability not less than $1,000,000 per occurrence and aggregate combined single limit, Personal Injury, Bodily Injury and Property Damage. C. Automobile Liability Insurance with limits of liability of not less than $1,000,000 per occurrence combined single limit including Bodily Injury and Property Damage. Coverage shall include all owned vehicles, all non -owned vehicles, and all hired vehicles. D. Professional Errors and Omissions Insurance which shall include Consultant's Computer Errors and Omissions Coverage, with limits not less than $1,000,000 per claim and in the aggregate. 11. INDEMNIFICATION Each party ( "Indemnitor ") agrees to indemnify and hold the other party ( "Indemnitee ") harmless from any claims, lawsuits, proceedings, losses, liabilities, damages, costs and expenses (including reasonable attorneys' fees) made against or incurred by Indemnitee as a result of negligence, misrepresentation, error or omission on the part of Indemnitor or Indemnitor's employees, agents or representatives. Shana Yelverton April 13, 2005 6 12. NON - SOLICITATION The parties agree that, during the term of this Agreement and for a period of one year from the termination of this Agreement, neither party will solicit for employment or otherwise attempt to hire any employees of the other party or its affiliates who were involved in the performance or direct oversight of this Agreement without the prior written consent of such party. 13. COMPLIANCE WITH LAW A. In rendering services under this Agreement, MAXIMUS shall comply with all applicable federal, state and local laws, rules and regulations pertaining to equal employment opportunity and shall not discriminate based on age, ancestry, color, gender, marital status, medical condition, national origin, physical or mental disability, race, religion or sexual orientation. B. MAXIMUS will comply with all applicable federal, state and local laws, rules and regulations regarding the maintenance of a drug -free workplace. 14. CONFIDENTIALITY MAXIMUS agrees that all information disclosed by the Client to MAXIMUS shall be held in confidence and used only in performance under this Agreement. MAXIMUS shall exercise the same standard of care to protect such information as is used to protect its own proprietary or trade secret information. Client understands and agrees that it may have access to confidential or proprietary information, processes or documentation owned or controlled by MAXIMUS. Client understands and agrees that disclosure or use of such information, processes or documentation may violate MAXIMUS' trademarks, copyrights or other proprietary rights. Client agrees to exercise reasonable standards of care to protect such information, processes or documentation. 15. INSPECTION Authorized representatives of Client may inspect or audit MAXIMUS' performance and records pertaining to this Agreement at the MAXIMUS business office during normal business hours. 16. ASSIGNMENT Neither party shall assign or transfer this Agreement nor any duties or obligations hereunder without the prior written approval of the other party. 17. NOTICES All notices under the Agreement will be in writing and will be delivered by personal service, facsimile or certified mail, postage prepaid, or overnight courier to such address as may be designated from time to time by the relevant party, which initially shall be the address set forth below: CLIENT MAXIMUS Shana Yelverton April 13, 2005 Any notice sent by certified mail will be deemed to have been given five (5) days after the date on which it is mailed. All other notices will be deemed given when received. No objection may be made to the manner of delivery of any notice actually received in writing by an authorized agent of a party. 18. DISPUTES Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, that cannot be resolved through negotiation between the parties, shall be settled by arbitration administered by the American Arbitration Association under its Commercial Arbitration Rules, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. Any such arbitration proceedings shall be held in In the event arbitration is initiated to enforce or interpret any part of the Agreement, the prevailing party shall be entitled to recover its reasonable attorneys' fees to be fixed by the arbitrator(s). 19. GOVERNING LAW The Agreement shall be governed and construed in accordance with the laws of the Commonwealth of Virginia without regard to choice of law principles. 20. SURVIVAL Notwithstanding the expiration or early termination of this Agreement, the provisions hereof pertaining to Confidentiality and Non - Solicitation shall survive. 21. SEVERABILITY If any provision of the Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any manner. 22. FORCE MAJEURE Neither party shall be liable hereunder by reason of any failure or delay in the performance of its obligations hereunder (except for the payment of money) on account of strikes, shortages, riots, insurrection, fires, flood, storm, explosions, earthquakes, acts of God, war, governmental action, labor conditions, material shortages or any other cause which is beyond the reasonable control of such party. 23. WAIVER No provision of the Agreement may be waived unless in writing, signed by both of the parties hereto. Waiver of a breach of any provision of the Agreement shall not operate or be construed as a waiver of any subsequent breach of such provision, nor shall a waiver of any one provision of the Agreement be deemed to be a waiver of any other provision. 24. AMENDMENTS, SUPPLEMENTS The Agreement may be amended or supplemented only by the mutual written consent of the parties' authorized representatives. Shana Yelverton April 13, 2005 25. BINDING EFFECT, BENEFITS The Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and assigns. Notwithstanding anything contained in the Agreement to the contrary, nothing in the Agreement, expressed or implied, is intended to confer on any person other than the parties hereto or their respective successors and assigns, any rights, remedies, obligations or liabilities under or by reason of the Agreement. 26. HEADINGS The Section headings in the Agreement are inserted only as a matter of convenience, and in no way define, limit, or extend or interpret the scope of the Agreement or of any particular Article or Section. 27. AUTHORIZATION Each of the parties represents and warrants that the Agreement is a valid and binding obligation enforceable against it and that the representative executing the Agreement is duly authorized and empowered to sign the Agreement. 28. COUNTERPARTS The Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. 29. ENTIRE AGREEMENT The Agreement and any schedules and exhibits thereto contain the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes and replaces any and all prior discussions, representations and understandings, whether oral or written. IN WITNESS WHEREOF, the parties have executed this Agreement through their duly authorized representatives. MAXIMUS By Client NJ Title Title Shana Yelverton April 13, 2005 EXHIBIT A SCOPE OF SERVICES Shana Yelverton April 13, 2005 10 EXHIBIT B COST AND FEE SCHEDULE [SAMPLE] PAYMENTS TO CONTRACTOR This is a time and materials contract. In consideration for the services provided, Client agrees to pay MAXIMUS monthly based on the actual hours worked and actual expenses incurred. MAXIMUS shall submit monthly invoices in sufficient detail to support the services provided during the previous month. Services will be billed at the rates specified in the table below. Position Hours Rate Cost Project Management Senior Functional Consultant Senior Technical Consultant Functional Consultant Technical Consultant Total MAXIMUS will be reimbursed by the Client for all reasonable travel and living expenses incurred by staff while performing services under this agreement. MAXIMUS agrees to maintain detailed supporting documentation for actual expenses incurred.