HomeMy WebLinkAboutContract 32246 CITY SECRETARY
CONTRACT NO
STATE OF TEXAS )
KNOW ALL MEN BY THESE PRESENTS:
COUNTY OF TARRANT )
THIS AGREEMENT is made and executed by and between the City of Fort Worth,
Texas, a municipal corporation situated in Tarrant, Denton, and Wise Counties, Texas,
hereinafter called the "City", acting herein by and through Marc Ott, its duly authorized
Assistant City Manager, and MAXIMUS, Inc. , hereinafter called the "Consultant."
WITNESSETH:
WHEREAS, the City requires a cost analysis of infrastructure-related plan review and
inspection activities in the engineering, Transportation and Public Works (TPW) and Water
and Sewer Departments ; and
WHEREAS, Consultant represents that it has the requisite experience and expertise
and is willing to provide such services.
NOW, THEREFORE, that for and in consideration of the mutual covenants and
agreements herein contained, the parties hereto do hereby covenant and agree as follows:
SECTION 1. Scope of Services: Consultant shall perform the services as described in Exhibit
"A" to this Agreement, the proposal letter from J. Mark Carpenter dated July 7. 2005. Dtinno
the term of this Agreement, City may request changes in the Scope of Services. Any such
change, including any increase or decrease in the amount of compensation, requires the
mutual agreement of the parties and shall be effective when incorporated by written
amendment to this Agreement.
SECTION 2. Compensation: The total amount paid to Consultant under this Agreement shall not
exceed SIXTEEN THOUSAND, SIX HUNDRED SEVENTY DOLLARS ($16,670.00). This
amount shall constitute full and complete compensation for the Consultant's services under this
Agreement, including all expenditures made and expenses incurred by the Consultant in
performing such services, and which amount is hereinafter referred to as the "Basic Fee."
City shall pay Consultant Ninety (90) percent of the Basic Fee within thirty (30) days of
receipt of the draft report and the remaining ten (10) percent of the Basic Fee within thirty (30)
days of receipt of the final report.
Consultant shall submit invoices to the City in sufficient detail to support the services
provided. City agrees to pay those invoices within thirty (30) days of receipt. In the event
City disputes a portion of an invoice, City agrees to pay the undisputed portion of the invoice
within thirty (30) days of receipt and to provide Consultant with a detailed statement of City's
position on the disputed portion of the invoice within thirty (30) days of receipt. City'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 entitle Consultant to charge interest at the lower of
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ORIGINAL
1.5% per month or the highest rate permitted by law.
SECTION 3. Standard of Care: Consultant warrants that it will perform the services
contemplated in this Agreement in accordance with the standards of care and diligence
normally practiced by recognized consulting firms in performing services of a similar nature.
If, during the six month period following the earlier of completion or termination of this
Agreement, it is shown there is an error in the Consultant's services. caused solely by
Consultant's failure to meet such standards, and the City has promptly notified Consultant in
writing of any such error with that period, Consultant shall perform at its sole cost and expense
such corrective consulting services within the original Scope of Services as may be necessary
to remedy such error.
SECTION 4. Insurance: Consultant 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.
E. ADDITIONAL INSURANCE REQUIREMENTS:
a. The City, its officers, employees and servants shall be named or listed as an
additional insured on Consultant's insurance policies with the exception of the
Consultant's workers' compensation insurance policy.
b. Certificates of insurance shall be delivered to the City of Fort Worth, contract
administrator in the respective department, 1000 Throckmorton Street, Fort Worth,
TX 76102, prior to commencement of work on the contracted project. Certificate
shall identify sublimits of coverage if any. Certificate shall clearly indicate whether
the insurance covers subcontractors.
c. Any failure on part of the City to request required insurance documentation shall not
constitute a waiver of the insurance requirements specified herein.
d. Each insurance policy shall be endorsed to provide the City a minimum thirty days
notice of cancellation, non-renewal, and/or material change in policy terms or
coverage. A ten days notice shall be acceptable in the event of non-payment of
premium.
e. Insurers must be authorized to do business in the State of Texas and have a current
A.M. Best rating of A: VII or equivalent measure of financial strength and solvency.
f. For all insurance, other than worker's compensation insurance, in lieu of commercial
insurance, the City may consider alternative coverage or risk treatment measures
through insurance pools or risk retention groups. The City must approve in writing
any alternative coverage.
g. Workers' compensation insurance policy(s) covering employees employed on the
project shall be endorsed with a waiver of subrogation providing rights of recovery in
favor of the City.
h. City shall not be responsible for the direct payment of insurance premium costs for
Consultant's insurance.
i. Consultant's insurance policies shall each be endorsed to provide that such insurance
is primary protection and any self-funded or commercial coverage maintained by City
shall not be called upon to contribute to loss recovery.
j. In the course of the project, Consultant shall report in writing and in a timely manner
to City's officially designated contract administrator any known loss occurrence
which could give rise to a liability claim or lawsuit or which could result in a property
loss.
k. Consultant's liability shall not be limited to the specified amounts of insurance
required herein.
1. Upon the request of City, Consultant shall provide complete copies of all insurance
policies required by this Agreement.
SECTION 5. Establishment and Maintenance of Records: Records shall be maintained by the
Consultant at its place of business with respect to all matters covered by this Agreement. Such
records shall be maintained for a period of three (3) years after receipt of final payment under
this Agreement.
SECTION 6. Responsibilities:
A. The parties understand and agree that the City is providing certain personnel resources
and facilities to Consultant in connection with selected tasks under this Agreement and
Consultant is relying on the availability of such resources. The City shall provide these
resources in a timely manner and represents that the personnel resources are
appropriately qualified and capable of performing the assigned tasks.
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B. Consultant 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. Consultant shall retain financial, programmatic, City data and other service records for
five (5) years from the date services are completed.
SECTION 7. Rights in Data: City 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 Consultant in the course of the services pursuant to this
Agreement, whether jointly or individually, subject to the Confidentiality provisions of this
Agreement. Notwithstanding anything to the contrary contained herein or in any attachment
hereto, any and all intellectual property or other proprietary data owned by Consultant prior to
the effective date of this Agreement ("Preexisting Information") shall remain the exclusive
property of Consultant even if such Preexisting Information is embedded or otherwise
incorporated into materials or products first produced as a result of this Agreement or used to
develop such materials or products. The City's rights under this section shall not apply to any
Preexisting Information or any component thereof regardless of form or media
SECTION 8. Audits and Inspections: The Consultant agrees that the City shall, until the
expiration of three (3) years after the final payment under this Agreement have access to and the
right to examine any directly pertinent books, documents, papers and records of the Consultant
involving transactions relating to this Agreement. The Consultant agrees that the City shall have
access during normal working hours to all necessary Consultant facilities and shall be provided
adequate and appropriate work space in order to conduct audits in compliance with the provisions
of this Section. The City shall give Consultant reasonable advance notice of intended audits.
The Consultant further agrees to include in all its subcontracts hereunder a provision to the
effect that the subcontractor agrees that the City shall, until the expiration of three (3) years after
the final payment and directly pertinent books, documents, papers and records of such
subcontractor, involving transactions to the subcontract, and further, that City shall have access
during normal working hours to all subcontractor facilities, and shall be provided adequate and
appropriate work space, in order to conduct audits in compliance with the provisions of this
article, and shall give subcontractor reasonable advance notice of intended audits.
SECTION 9. Indemnity and Limitation of Liability: The Consultant agrees to defend. indemnify
and hold harmless the City and its officials, agents and employees from and against third parte
claims, actions, suits or proceedings brought against said parties to the extent caused by the
negligent act, error, or omission of the Consultant or anyone for whom it is legally liable in the
performance of services hereunder. The Consultant is not required hereunder to defend,
indemnify and hold harmless the City of Fort Worth and its officials, agents and employees
from li ibility resulting from the negligence or wrongful acts of the City or any third party. For
the purposes of this Section, the term "third party" does not mean officers, subconsultants. the
agents or employees of the Consultant. The indemnity required hereunder shall not be limited bN
reason of the specification of any particular insurance coverage in this Agreement.
The Consultant shall have the right to defend against any and all such claims, actions, suits or
proceedings with counsel of its own choosing and shall have the right to settle and or
compromise such matter as the Consultant deems appropriate. The City shall provide Consultant
with written notice of such claims within 10 business days after receipt of same by the City.
The City agrees that it will cooperate with the Consultant in the defense of any such matter
including, but not limited to, providing necessary documents and personnel to testify.
The total aggregate liability of Consultant arising out of the performance or breach of this
Agreement shall not exceed an amount equal to two times the total compensation paid to
Consultant under this Agreement. Not withstanding any other provisions of this Agreement, the
Consultant shall have no liability to the City for contingent, consequential or other indirect
damages including, without limitation, damages for loss of use or revenue; operating costs or
facility downtime; or other similar interruption losses, however, the same may be caused. The
limitations and exclusions of liability set forth in this subsection shall apply regardless of the
fault, breach of contract, tort (including the concurrent or sole exclusive negligence), strict
liability or otherwise of the Consultant, its employees or subconsultants.
SECTION 10. Compliance with Laws: In providing the scope of services outlined herein. the
Consultant shall comply with all applicable laws, ordinances, and codes of the Federal. State and
local governments.
SECTION 11. Non-Discrimination: The Consultant agrees that its employees and applicants 1'01'
employment and those of any labor organization, subconsultants, or employment agency in either
furnishing or referring employee applicants to the undersigned are not discriminated against as
prohibited by the terms of City Ordinance No. 7278 as amended.
SECTION 12. Confidentiality: Consultant agrees that all information disclosed by the City to
Consultant shall be held in confidence and used only in perfonnance under this Agreement.
Consultant shall exercise the same standard of care to protect such information as is used to
protect its own proprietary or trade secret information.
City urderstands and agrees that it may have access to confidential or proprietary information.
processes or documentation owned or controlled by Consultant. City understands and agrees that
disclosure or use of such information, processes or documentation may violate Consultant's
trademarks, copyrights or other proprietary rights. City agrees to exercise reasonable standards
of care to protect such information, processes or documentation.
SECTION 13. Personnel:
A. The Consultant represents that it has, or will secure at its own expense, all personnel
required in performing all of the services required under this Agreement. Such
personnel shall not be employees of or have any contractual relationships with the
City.
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B. All the services required hereunder will be performed by the Consultant or under its
supervision and all personnel engaged in the work shall be qualified and shall be
authorized or permitted under state and local law to perform such services.
SECTION 14. Assignability: Neither party hereto shall assign, sublet or transfer its interest
herein without prior written consent of the other party, and any attempted assignment, sublease
or transfer of all or any part hereof without such prior written consent shall be void.
SECTION 15. No Third-Party Beneficiaries: This Agreement shall inure only to the benefit of
the parties hereto and third persons not privy hereto shall not, in any form or manner, be
considered a third party beneficiary of this Agreement. Each party hereto shall be solely
responsible for the fulfillment of its own contracts or commitments.
SECTION 16. Termination for Cause. If through any cause, unless it is caused by another
party or due to an act beyond the control of the Consultant, the Consultant shall fail to
materially fulfill in a timely and proper manner its obligations under this Agreement or if the
Consultant shall materially violate any of the covenants, agreements or stipulations of this
Agreement, the City shall thereupon have the right to terminate this Agreement by giving
written notice to the Consultant of such termination and specifying the effective date thereof,
with such effective date not to occur earlier than thirty days after the notice date. The
Consultant shall have thirty calendar days to cure such alleged defaults. Unless such alleged
defaults are cured and accepted by the City within this thirty-day period, the Consultant shall
immediately cease all work. In such event, all finished or unfinished documents, data, maps,
studies, surveys, drawings, models, photographs and reports prepared by the Consultant under
this Agreement shall, at the option of the City, become its property, and the Consultant shall be
entitled to receive compensation in accordance with the terms of this contract for all work
completed in accordance with the terms of this contract up to the date of termination.
Performance shall be defined in accordance with the terms of this contract and all attachments.
Compensation is to include fees and expenses incurred by the Consultant as defined by this
Agreement. Nothing herein shall constitute a waiver of any right, at law and at equity, which
the City may have if the Consultant is in default of this contract. The Consultant' s work papers
are specifically excluded from the list of documents which become the City' s property under
this Section. However, the City does have the right to make copies, at its own expense, of the
Consultant's work papers solely for it's internal purpose as related to the services performed
hereunder.
SECTION 17. Termination for Convenience of City: The City may terminate this Agreement
for its convenience at any time by giving at least thirty days' notice in writing to the
Consultant. In the event of termination pursuant to this paragraph, Consultant shall be entitled to
receive payment for all work completed or in progress, and for costs reasonably incurred to
close out its project services. Compensation is to include fees, expenses, and liabilities to
subconsultants or other third parties. Consultant will make reasonable attempts to cancel all
such liabilities in order to mitigate the cost to the City. If this Agreement is terminated due to
the fault of the Consultant, Section 15 hereof relative to termination shall apply.
SECTION 18. Force Majeure: It is expressly understood and agreed by the parties to this
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Agreement that if the performance of any obligations hereunder is delayed by reason of war:
civil commotion; acts of God; inclement weather; governmental restrictions. regulations. or
interferences; fires; strikes; lockouts, national disasters; riots; material or labor restrictions:
transportation problems; or any other circumstances which are reasonably beyond the control of
the party obligated or permitted under the terms of this Agreement to do or perform the same,
regardless of whether any such circumstance is similar to any of those enumerated or not, the
party so obligated or permitted shall be excused from doing or performing the same during such
period of delay, so that the time period applicable to such requirement shall be extended for a
period of time equal to the period such party was delayed.
SECTION 19. Severability: If any portion of this agreement is held to be void, invalid. or
otherwise unenforceable, in whole or part, the remaining portions of this agreement shall
remain in effect.
SECTION 20. Waiver: No waiver of performance by either party shall be construed as or
operate as a waiver of any subsequent default of any terms, covenants, and conditions of this
Agreement. The payment or acceptance of fees for any period after a default shall not be
deemed a waiver of any right or acceptance of defective performance.
SECTION 21. Venue: If any action, whether real or asserted, at law or in equity, arises on the
basis of any provision of this Agreement,venue for such action shall lie in state courts located
in Tarrant County, Texas or the United States District Court for the Northern District of Texas—
Fort Worth Division. This Agreement shall be construed in accordance with the laws of the
State of Texas.
SECTION 22. Agreement Amendment: This instrument represents the entire understanding
between the City and the Consultant in respect to the Project, supersedes any and all prior written
or oral negotiations of agreements between the parties, and may only be modified in writing
signed by both parties.
SECTION 23. motions: The captions of this Agreement are for informational purposes only and
shall not in any way affect the substantive terms and conditions of the Agreement.
SECTION 24. Conflicts: This Agreement is the sole agreement between the City and the
Consultant and any and all other prior agreements, whether oral or written, are merged into this
Agreement and of no further force or effect.
SECTION 25. Notices: All notices, requests, demands, and other communications which are
required or permitted to be given under this Agreement shall be in writing and shall be deemed
to have been duly given upon the delivery or receipt thereof, as the case may be, if delivered
personally or sent by registered or certified mail, return receipt requested, postage prepaid, as
follows:
1. CITY OF FORT WORTH: Marc Ott, Assistant City Manager
City Manager's Office
7
City of Fort Worth
1000 Throckmorton Street
Fort Worth, TX 76102
Copies to: Robert Goode, Director
Transportation Public Works
City of Fort Worth
1000 Throckmorton
Fort Worth, TX 76102
2. CONSULTANT: MAXIMUS
J. Mark Carpenter
13601 Preston Road, Suite 201E
Dallas, Texas 75240
Executed thisday of ' 2005.
Approval Recommended: CITE' OF FO T WO
/ Ae � c
Robert Ef. Goode, Director Marc A. Ott
Transportation Public Works Assistant Ci Manager
ATTEST: Approve to Form and Legality:
Marty HendA A sistant 11f
orn y j
City Secretary
NO M&C REQUIRED ' CONSULTANT
-----��� MAXIMUS
QWBy:
J. ark Carpen
StMe Manager
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EXHIBIT A:
PROPOSAL LETTER
MAXIMUS
HELPING GOVERNMENT SERVE THE PEOPLE'
July 7, 2005
Christa Sharpe
Assistant Director
Transportation and Public Works
City of Fort Worth, Texas
1000 Throckmorton
Fort Worth, Texas 76102
Dear Ms. Sharpe:
MAXIMUS, INC. is pleased to present a proposal to the City of Fort Worth for a cost of
services/user fee study to cover specific infrastructure development fees for Transportation and
Public Works, Water and Sewer, and Engineering departments.
The following proposal details the proposed services MAXIMUS can provide to the City.
BACKGROUND
The City provides many fee-related infrastructure development services to developers in the City
of Fort Worth. The City wants to ensure that the fees charged for infrastructure development
projects bear a direct relationship to the city's cost of providing these services. Subsidization of
these services results from not updating the fee schedules.
The City needs to maintain or increase its revenue base in order to maintain or enhance the
development service levels it provides to its citizenry. Therefore, the City is interested in
analyzing the cost of service and revenue relationships that exits among the various
infrastructure development fee for service activities. The results of this analysis will provide the
tool for understanding the current service levels, the cost and demand for those services, and
what fees for service can and should be charged.
The City recognizes the benefit from using outside professional expertise to assist in this
engagement. City staff could not complete this work in-house without jeopardizing current
responsibilities. Furthermore, without qualified outside professional assistance, the City could
not successfully implement a comprehensive program within the immediate timeframe. Based on
our firm's experience in other jurisdictions, we can produce the comprehensive results the City
desires. We believe that with our assistance, the City of Fort Worth will have the knowledge and
ability to maximize its revenue equitably between all service users.
SCOPE OF SERVICES
MAXIMUS proposes to complete the following scope of services for the City of Fort Worth:
11495 N. PENNSYLVANIA STREET • CARMEL,INDIANA 46032 • 317-575-4911
0
Ms. Christa Sharpe,Assistant Director, TPW July 7, 2005
City of Fort Worth, TX Page 2
• The focus of the fee element of this project will be on the City's infrastructure and civil
engineering regulation systems. It excludes all other fee activities. Specifically. the fee areas
will include:
1) Community Development Facility Agreement Fee
2) Plan Review Fees
3) Inspection Fees
4) Materials Testing Fees
• Determine the full cost of providing each the service to the outside user. Cost will include not
only the direct department cost, but an allocation of administrative and overhead costs.
• Identify increased fees and projected revenue increases for possible implementation.
• Identify factors that might affect a decision to implement a fee structure based on recovery of
full costs.
• Prepare a draft report on the fee analysis summarizing the results of the fee study and
projecting revenues.
• Prepare a final report of the fee analysis.
• Develop and present a presentation package, prepared in conjunction with City staff; which
will present the data and explain the costing structure to City officials, developers and/or City
Council.
• Provide the City with a costing model that may be used in future years to update the cost
analysis and determine new fee levels.
MO OR()('LE",�/
oC.
Ms. Christa Sharpe,Assistant Director, TPW Jule, 7, 7005
City of Port Worth, TX Page.?
WORK PROGRAM
Cost of Services/User Fee Study
The work program to provide the Cost of Services/User Fee Study for the three departments is
divided into two phases and a total of seven (7) tasks. The first phase is concerned with the
development of the Cost of Services Analysis itself. The second phase is concerned with the
presentation of the results to the Department staff, City officials, and interested third parties.
Following are descriptions of the eight tasks required for the completion of this study.
Phase I - Development of the Cost of Services Analysis
MAXIMUS will conduct a cost/revenue analysis to determine the full cost of services.
Following is a breakdown of the first five tasks.
Task 1. Initiate User Fee Proiect.
A. Establish City's Priorities and Goals. An initial meeting is held with the City's
management staff to determine the exact parameters of the engagement.
MAXIMUS staff understand the general goals going into the engagement;
however, having an initial meeting to set and determine goals ensure that the final
product will meet all of the City's expectations.
B. Engagement Briefing. MAXIMUS will present a briefing to the departments
concerning the goals of the engagement, the steps to complete the goals, the time
frame the departments can expect, the requests we will place on the departments
and the benefits of the engagement. MAXIMUS staff is completely responsible
for the gathering of information and statistics.
The purpose of this meeting is to attain the cooperation and support of the
departments by informing them fully. This can be accomplished as a group or
with each department individually.
C. Establish Contact Individual. The appointment of an individual within the City's
Transportation and Public Works Department is imperative for the smooth flow of
any engagement. This person's involvement is limited to the scheduling of
interviews with key department personnel as deemed necessarN b" the
consultants, as well as to direct the MAXIMUS staff to the appropriate location of
documents and data required throughout the engagement. At this point in the
engagement, a contact person for each department should be established.
D. Review Organizational Structure. A complete organizational staffing schedule is
crucial to determining operating costs, including management. supervisory,
clerical and line employees.
MAXIMUS; A
Ms. Christa Sharpe,Assistant Director, TPW July 7,2005
City of Fort Worth, TX Page 4
E. Review Accounting System/Anal zee Expenditure and Salary Data. This is a
crucial step necessary in order for MAXIMUS staff to understand the proper
treatment for all expense items. MAXIMUS requests expenditure and salary data
for each of the departments/divisions to be included in the study. This step also
allows the consultants to familiarize themselves with the statistics available. It
also includes establishment of the initial costing models used in the interviews
with each department.
Task 2. Understand Schedule of Current Fees and Chartres. Current fees and
charges will be identified and documented. This involves surveying all departments to
determine the specific charges collected in each department. It should be noted that it is
not our objective within this study to restructure existing fee schedules that may be based
on a sliding scale or tiered structure, or to structure fees in areas that a fee does not
currently exist. Our analysis consists of a cost/revenue match-up. However, if the City
desires to establish a new fee structure, MAXIMUS will leave the City with the tools
necessary to accomplish the tasks in-house or allow for a revised scope of services for
MAXIMUS to complete the work at a later time.
Task 3. Cost/Revenue Analysis of Services.
A. Interview Process. Within this process, each department is analyzed and
functionalized to reflect the various activities being performed within it. This step
is conducted through interviews with key department personnel as well as in-
depth review of documentation of job duties. MAXIMUS will develop an initial
model of the costs, personnel, and activities included in each department/division
included in the study. A consultant will them schedule meetings with appropriate
City staff members and together build the cost model.
For each activity that is being reviewed and analyzed, the actual expenditures
must be identified for the period being studied. Any costs directly billed or
charged back must also be considered at this point within the engagement. At the
conclusion of this step, the department expenses are entered into the sottwarc
program.
B. Select Per Unit Basis. Each activity must have a per unit basis (i.e. numher 01'
permits, hours etc.). In completing this task. the following criteria serve as a
guideline in our selection process.
a. The basis must be accurate.
b. The basis must be defensible.
c. The basis must conform to generally accepted allocation and unit cost
standards.
d. The basis must be consistently applied.
NO XIMus
HELPING GOVF.RNMENTSERV£THE PEOPLE'
Ms. Christa Sharpe,Assistant Director, TPW July 7, 2005
City of Fort Worth, TX Page 5
The results of this segment of our engagement are input as allocation units within
the software program.
C. Incorporate the Citywide Central Service Costs. This task increases the
allocations of unallocated and central service dollars to City agencies to support
determinations of costs for fees and user charges.
When comparing the cost of providing a service with the revenue received from
the charges, the costs need to include not only the expenditures contained in a
department's budget, but the department's share of central service costs (e.g..
payroll, purchasing, data processing, janitorial, etc.). A Citywide cost allocation
plan, identifies each department's share of central service costs. These central
service costs (indirect costs) will be added to the department's costs (direct costs)
when analyzing the cost of each service area or activity. MAXIMUS will use
data already included in the City's existing full cost allocation plan.
D. Select Most Appropriate Costing Approach. Depending on the availability of
data, type of service and needs of the City, MAXIMUS utilizes either the Cost
Pool Method (i.e., top down approach) or the Unit Cost Method (i.e.- hOU0111 u1)
approach) of costing. Both methods are further explained below.
Cost Pool Method - "Top Down Approach". This costing method identifies
comparable revenue and cost pools within a department. The cost pool is taken
down to the lowest level at which valid cost and/or revenue data are available. An
example would be Building Permits where cost, revenue, and number of permits
can be identified at the "total" Building Permit level; whereas. it may not he
possible to identify the cost, revenue and number of permits for a Building Permit
for Storage Facilities with an area between 2,001 and 5,000 square feet. Thus,
although the cost to issue a particular permit is not identified. the direct cost of the
total service is known. When the other costs are added to the direct costs, the full
cost of the service is identified. This full cost can then be compared with the
revenue generated with any necessary fee increases identified. To develop a unit
cost figure, the full cost of the service is then divided by the total number of
service units.
Unit Cost Method - "Bottom Up Approach". This costing method identifies the
cost at the unit activity level where the effort of individuals by activity is
identified. The time spent for a fee activity is determined for each individual or
position with the hourly rate based on using the individuals productive hours.
Productive hours are total hours (usually 2,080) less vacation, holidays. sick
leave, administrative time, etc. With the overhead cost added to the individual's
salary and other direct costs and this full cost divided by productive hours, a fully
loaded hourly rate is determined. This rate is then multiplied by the time
MAXIMUS
HE NG GOVEkNNEWSERVE THEFEOP[.E'
Ms. Christa Sharpe,Assistant Director, TPW July 7, 2005
City of Fort Worth, TX Page 6
necessary to perform the activity. The resulting cost can then be compared to the
actual fee schedule.
Task 4. Process Cost of Services Study. Utilizing the knowledge and data obtained
through the prior four tasks, the various department fee analyses are now prepared. A
computer run is completed which produces a draft report. A User Fee Summary schedule
is produced by the software, which presents the cost/revenue analysis on a clear single
schedule such that the review process by City staff can begin.
Phase II - Presentation of Results to the City
The presentation phase is critical to the success of the overall engagement. It involves three
distinct stages. The initial stage is the review of findings and recommendations with each of the
departments. Once the departments are aware of the methodology and have reviewed our
findings for their individual department, we proceed to the second stage. This stage is the
presentation of the overall study to City management for their review and concurrence. When
this second stage is completed, then the final stage is the presentation of the results to the City
officials for their consideration. MAXIMUS will assist the City with this presentation.
MAXIMUS staff members are fully cognizant of the importance of making a thorough and
understandable presentation to City officials.
Task 5. Department Review of Initial Study. This segment of the engagement
involves conducting secondary interviews with department representatives to review the
initial results of the Cost of Services/Revenue Analysis and discuss the revenues and
associated costs of each service area. Comments received at this time are incorporated in
the review process.
Task 6. Joint Meeting of All Departments to Review the Study. We then present the
"draft" report to the group of three departments and their appropriate representatives.
Together, we will review our assumptions and the results. Invariably, there are certain
changes in the study that the client requests. After a full discussion of the issues we will
enter the agreed upon changes into the program and finalize the study.
Task 7. Presentation of Results to City Officials/Developers/Other Interested
Parties. The objective of this final step is to present a very succinct, straightforward
executive summary document that clearly summarizes the results of the engagement.
Because of this fact, graphic representations are commonly used within the report.
MAXIMUS is heavily committed to the full and complete understanding and satisfaction
of any client's management regarding the results of our engagement. As such, we
commonly present the results to the governing body of our client or provide support
during any presentation made by our client to individuals within its own organization.
These two phases and seven tasks complete the Cost of Service/User Fee Study.
MAXIMUS
HELPING GOVERNMENT SERVE THE PEOPLE'
Ms. Christa Sharpe,Assistant Director, TPW July, 7, 2005
City of Fort Worth, TX Page 7
FEES AND PROJECT SCHEDULE
The table below summarizes the cost proposal to complete the services identified above:
Fee Schedule
Project Project
Director Manager Total
Cost of Services/User Fee Study
Taskl 16 24 40
Task 2 2 2
Task 3 8 20 28
Task 4 4 12 16
Task 5 4 10 14
Task 6 4 8 12
Task 7 4 4 8
Rate $ 163.00 $ 125.00 120
Expenses $ 100 $ 50
Subtotal $ 6,620 $ 10,050
TOTAL COST $ 16,670
Recognizing the City's time constraint, we are prepared to begin this work immediately, with
completion scheduled for mid-August 2005.
MAXIMUS looks forward to assisting the City of Fort Worth in analyzing its costs designed to
accurately identify costs for infrastructure fees and enhance City revenues. Please call me with
any comments regarding this proposal.
Very truly yours,
MAXIMUS, Inc.
?Mark Carpenter
State Manager
Cost Services Division
NVAXIMUS
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