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HomeMy WebLinkAboutContract 35840Deloitte � September 28, 2007 Joe Paniagua Assistant City Manager City of Fort Worth 1000 Throckmorton Fort Worth, Texas 76102 Dear Mr. Paniagua: CITY SECRETARI( ' GONTRACT NQ . Deloitte & Touche LLP Suite 1501 201 Mafn Street Fort Worth, TX 76702-3119 USA Tel: +1 817 347 3300 Fax: +1 817 336 2013 www.deloitte.com This letter confinns the engagement of Deloitte & Touche LLP ("D&T") to perform certain agreed-upon procedures to assist the City of Fort Worth (the "City") in connection with an evaluation of certain programs of the Fort Worth Crime Control and Prevention District (the "CCPD"). This engagement to perform agreed-upon procedures will be conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants, subject to the terms and conditions set forth herein. The specific procedures that D&T is to perform are set forth in the accompanying Appendix A. These procedures have been established based on discussions with you, and the sufficiency of the procedures is solely the responsibility of the CCPD, as discussed below. In addition, these procedures may be changed or modified by mutual agreement between the City, on behalf of the CCPD, and D&T if, for example, unforeseen circuznstances arise, D&T will promptly discuss any such circumstances with the CCPD and, likewise, the CCPD agrees to promptly notify D&T if modifications to the procedures are requested. ACKNOWLEDGEMENTS AND AGREEMENTS The CCPD and the City specifically acknowledges and agrees to the following; • The performance of the agreed-upon procedures will not constitute an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion on the CCPD's or the City's financial statements. Therefore, D&T will not be in a position to express, and will not express, an opinion or a.ny other form of assurance with respect to any matters as a result of performing the agreed-upon procedures. • The agreed-upon procedures that D&T is to perform at the request of the CCPD, and with the agreement of D&T, are limited in nature and do not comprehend all matters that might be pertinent or necessary to the CCPD's evaluation of the CCPD programs. Accordingly, the procedures should not be taken to supplant other inquiries and procedures that the CCPD should undertake for the purpose described above. ,. l , ��li J�: t=l` j�'�uV;%ij � -:r,?' �i��� ��., . . ;.,�,^�, �;�,U �� �( Member of °'• �:� 1: � �➢ �L 6� , �eloitte Touche Tohmatsa-=--_ _ - • D&T's report will not extend to any financial statements of the CCPD or the City, taken as a whole, or its internal control for any date or period. The nature, scope, and design of the agreed-upon procedures that D&T is requested to perform are solely the responsibility of the CCPD. Furthermore, D&T has no responsibility to advise the CCPD of other procedures that might be performed and makes no representations as to the sufficiency of such procedures for the purposes of the CCPD. • D&T's responsibility is limited to perfornung the procedures specified and agreed to, and to reporting the resulting fmdings, subject to the limitations contained herein, and D&T's engagement cannot be relied on to disclose significant deficiencies, material weaknesses, or fraud should they exist, In addition, D&T's engagement cannot be relied on to disclose errors, other than those errors that may be reported as fmdings in connection with the application of the agreed-upon procedures that D&T is to perform hereunder. D&T has no responsibility for updating the procedures performed or for performing any additional procedures. • The City, on behalf of the CCPD, shall be solely responsible for the design and operation of effective internal control and for complying with all applicable laws and regulations. • The City, on behalf of the CCPD, shall be solely responsible for providing accurate and complete information requested by D&T. D&T has no responsibility for the accuracy or completeness of the information provided by or on behalf of the City, on behalf of the CCPD. � Immediately prior to the completion of this engagement, D&T will request that the City's management, on behalf of the CCPD's management, provide D&T with a representation letter acknowledging management's responsibility for the information provided to us and confirming certain representations made to D&T during the engagement. • Should D&T deternune that significant restrictions are being placed on the performance of the agreed-upon procedures by the CCPD, including, without limitation, the failure of management to provide D&T with a management representation letter that D&T deternunes to be satisfactory, D&T shall be entitled to withdraw from this engagement. • To the extent allowed by law, any report issued by D&T hereunder will not be used by or circulated, quoted, disclosed or distributed to, nor will reference to such report or D&T's engagement hereunder be made to, anyone who is not a member of management or the board of d'zrectors of the CCPD, or management or the City Council of the City of Fort Worth. FEES Our fees for these services are based on the amount of time required at various levels of responsibility. We estimate that our total fees for the performance of these procedures will be $25,000. We will perform these procedures at a rate of $155 per hour. Only that portion of those procedures described in Appendix A that may be completed within this fee will be completed and reported upon. We will perform the procedures in the oxder that they appear in Appendix A and will cease the performance of further procedures when we have reached the designated total fee goal. 5hould any additional procedures then be desired by the CCPD Board we will discuss those 2 ':,1 _",,.' ' , . _ :�'� l �riSv�i�'` �� ; �:i�l'�% �s�=?��'. � �� J :V:.ii ��J l` � 1' U �G i1 ��. �,...� J � 1 �,n., i fees with you at that time. NOT ALL PROCEDiJRES LISTED 1N APPENDIX A WILL BE COMPLETED. This engagement letter, including the appendices attached hereto and made a part hereof, constitutes the entire agreement between the parties with respect to this engagement and supersedes all other prior and contemporaneous agreements or understandings between the parties, whether written or oral, relating to this engagement. If the above terms are acceptable to you and the services described are in accordance with your understanding, please sign the copy of this engagement letter in the space provided and return it to us. Yours truly, �tiCa,:� � Ta-u,c.�� C t, J� Aclalowledged and approved on behalf of THE CITY OF F,1E)RT BY: ��j�� �_,=~- Title: ��� S�Tr� �� � (, r�, l�'��?NAc; ��'_ �__. , Date: ' •�.� ��� 1 ��P����� �� �� F0�10�1 ��l[�„ �EGAL..ITY: ; '�„ r �, _ , ., J %�� �' sssisT�tir Cr � � A � T�RN�Y "���-. Contrac� �u r��iz�tion � �C;►-� 1? a t e �s-J- �-' ' ,t: � �''f '� �i.;`,_ �:,r,1���;�: .�:�l,��J�� i �, ,_, n �, "� �'J � ��'s��, ��L��� , 4"�I ,yJ � G �ll �� ��7 � .�U� .• \%1: ���' ����a � z- �..._....� GENERAL BUSINESS TERMS Limitafion on Liabilitv. Release and Indemnification. a) The Fort Worth Crime Control and Prevention District and the City of Fort Worth (the °ClienC) agrees that D&T and its personnel will not be liable to the Client for any claims, liabilities, or e�enses relating to this engagement for an aggregate amount in excess of the fees paid by the Client to D&T pursuant to this engagement, except to the extent finally judicially determined to have resulted primarily irom the bad faith or intentional misconduct of D&T. In no event will D&T or its personnel be liable for consequential, special, indirect, incidental, punitive or exemplary loss, damage, or e�ense relaiing to this engagement. b) To the extent allowed by law, the Client agrees to release and indemnify D&T and its personnel from all claims, liabilities, and expenses relating to this engagement attributable to any misrepresentation by the ClienYs management. c) To the extent allowed by law, the Client agrees to indemnify and hold harmless D&T and its personnel from all claims, liabilitles, and expenses relating to this engagement, except to the extent finally judicially determined to have resulted primarily from the bad faith or intentional misconduct of D&T. d) The provisions of this Paragraph 1 will apply to the fullest extent of the law, whether in contract, statute, tort (such as negligence), or otherwise. In circumstances where all or any portion of the provisions of this Paragraph 1 are finally judicially determined to be unavailable, D&T's aggregate liability for any claims, liabilities, or expenses relating to this engagement shall not exceed an amount that is proportional to the relative fault that D&T's conduct bears to all other conduct giving rise to such claims, liabilities, or expenses. 2. Indeoendent Contractor. It is understood and agreed that each of the parties hereto is an independent contractor and that neither party is, nor will be considered to be, an agent, partner, fiduciary, or representative of the other. 3. Survival and Interaretation. The agreements and undertakings of the Client contained in the engagement letter to which these terms are attached (the "engagement letter'), together with the appendix to the engagement letter and these terms, will survive the completion or termination of this engagement. For purposes of the provisions in the "Acknowledgments and Agreements" section of the engagement letter and these terms, "D&T" shall mean Deloitte & Touche LLP and its subsidiaries; to the axtent providing services under the engagement letter, Deloitte Touche Tohmatsu, its member firms, and the affiliates of Deloitte & Touche LLP, Deloitte Touche Tohmatsu and its member firms; all of their partners, principals, members, owners, directors, staff, and agents; and in all cases any successor or assignee. 4. Assicanment. Except as provided below, neither party may assign, transfer, or delegate any of its rights or obligations hereunder (including, without Iimitation, interests or claims relating to this engagement) without the prior written consent of the other party. D&T may, without the consent of the Clfent or any other party, assign or subcontract its rights and obligations hereunder to any affiliate or related entity. 5. Disoute Resolution. Any controversy or claim between the parties arising out of or relating to the engagement letter, including its appendices, or this engagement (a "Dispute") shall be resoived by mediation or binding arbitration as set forth in the Dispute Resolution Provlsion attached hereto as Appendix B and made a part hereof. APPENDIX A AGREED-UPON PROCEDURES THE FORT WORTH CRIME CONTROL AND PREVENTION DISTRICT SEPTEMBER 28, 2007 Agreed-Upon procedures to be performed for the year ended September 30, 2005 (subject to the limitations described in the fee section above): 1. Gang Graffiti Abatement — Major program components include 2 civilian staff, supplies, contractual services a. We will obtain a listing of all graffiti abatement contractor invoices for the year and randomly select 10% of them(approximately 200 invoices), upon which the following procedures will be performed: i. Compare addresses to Tarrant Appraisal District records to verify that the addresses are either commercial or private property. ii. Determine whether compliance documentation was provided with the invoice (i.e. before and after pictures). iii. Compare the payment amount on the listing to the invoice amount. 2. Expanded Naxcotics - Major program components include staffing, miscellaneous supplies, and vehicle leases, all used in support of investigations of complaints of drug houses. a. Using cost center records we will compile a roster of employees actually charged to the cost center and will compare the total amount of employee costs to the amount originally budgeted for the program according to the adopted CCPD budget documentation. 3. Code: Blue — Major program components include temporary labor, supplies and fuel reimbursement. a. We will randomly select two months for testing. b. For the selected months, we will request a list of mileage reimbursement requests funded by the CCPD and will compare those requests to the request forms submitted by participating officers. c. Expenditures for the Code Blue banquet will also be examined to determine compliance with the City's purchasing regulations and procedures and adherence to budget. 4. Special Events Overtime - Major program components include civil service overtime and associated costs. a. For the month of Apri12005 we will obtain a list of all officer overtime charges funded by the CCPD in this area. b. We will compare the overtime charges on this list for Texas Motor Speedway traffic and security functions to the supplemental compensation forms filed by the officers. 5. Homeland Security — Major program components include staffing, equipment and supplies for the Intel Unit. a. Using cost center records we will compile a roster of employees actually charged to the cost center and will compare the total amount of employee ; . � � � d�,� �� .: f �J J�• :.t.�� � j,lS �„J �;l UJ ��j' � � G, � �j ������ ��:;U.'� � r� ti���'����� �;�� ���'�, ° , � � , costs to the amount originally budgeted for the program according to the adopted CCPD budget documentation. 6. School Security Initiative — Major progam components include staffing, supplies and vehicles costs necessary to provide officers in 8 school districts operating in Fort Worth, a. We will randomly select 10% of the quarterly charges paid to a118 school districts and compare them to supporting documentation provided by the school districts when billed. 7. Weapons — Major program components include purchase agreement for weapons a. We will read the authorization for the purchase of weapons with CCPD funds as documented in CCPD Board minutes and City Council minutes and compare to the purchase order, invoicing and receipt documentation for the purchase. g. Vehicles - Major program components include purchase agreements for replacement vehicles a. We will read the authorization for the purchase of vehicles with CCPD funds as documented in CCPD Board minutes and Fort Worth City Council minutes and compare to the purchase order, invoicing and receipt documentation for the purchase. b. We will verify the deposit of proceeds recovered from private insurance carriers through or by subrogation by the Risk Management Division of the Finance Deparhnent, required for all Police Department vehicles, purchased by the CCPD, totaled as a result of a third-party. We will compare the quarterly recovery reports prepared by the Risk Management Division to Police Deparhnent records to determine whether all vehicles totaled by a third-party are accounted for. We will determine whether all insurance monies owed to the District are accurately transferred and appropriated into the CCPD from the Risk Management Fund in accordance with the annual supplemental appropriation as authorized by the City Council (M&C). *�* � APPENDIX B DISPUTE RESOLUTION PROVISION FORT WORTH CRIME CONTROL AND PREVENTION DISTRICT SEPTEMBER 28, 2007 This Dispute Resolution Provision sets forth the dispute resolution process and procedures applicable to the resolution of Disputes and shall apply to the fullest extent of the law, whether in contract, statute, tort (such as negligence), or otherwise. Mediation: All Disputes shall be first submitted to nonbinding confidential mediation by written notice to the parties, and shall be treated as compromise and settlement negotiations under the standards set forth in the Federal Rules of Evidence and all applicable state counterparts, together with any applicable statutes protecting the confidentiality of inediations or settlement discussions. If the parties cannot agree on a mediator, the International Institute for Conflict Prevention and Resolution ("CPR"), at the written request of a party, shall designate a mediator. Arbitration Procedures: If a Dispute has not been resolved within 90 days after the effective date of the written notice beginning the mediation process (or such longer period, if the parties so agree in writing), the mediation shall ternunate and the Dispute shall be settled by binding arbitration to be held in New York, New York. The arbitration shall be solely between the parties and shall be conducted in accordance with the CPR Rules for Non-Administered Arbitration that are in effect at the time of the commencement of the arbitraiion, except to the extent modified by this Dispute Resolution Provision (the "Rules"). The arbitration shall be conducted before a panel of three arbitrators. Each of the Company and Deloitte & Touche LLP shall designate one arbitrator in accordance with the "screened" appointment procedure provided in the Rules and the two party-designated arbitrators shall jointly select the third in accordance with the Rules. No arbitrator may serve on the panel unless he or she has agreed in writing to enforce the terms of the engagement letter (including its appendices) to which this Dispute Resolution Provision is attached and to abide by the terms of this Dispute Resolution Provision. Except with respect to the interpretation and enforcement of these arbitration procedures (which shall be governed by the Federal Arbitration Act), the arbitrators shall apply the laws of the State of New York (without giving effect to its choice of law principles) in connection with the Dispute. The arbitrators shall have no power to award punitive, exemplary or other damages not based on a party's actual damages (and the parties expressly waive their right to receive such damages), The arbitrators may render a suimnary disposition relative to all or some of the issues, provided that the responding party has had an adequate opportunity to respond to any such application for such disposition. No discovery shall be pernutted in connection with the arbitration, except to the extent that it is expressly authorized by the arbitrators upon a showing of substantial need by the party seeking discovery. All aspects of the arbitration shall be treated as confidential, as provided in the Rules. Before making any disclosure pernutted by the Rules, a party shall give written notice to all other parties and afford such parties a reasonable opportunity to protect their interests. Further, judgment on the arbitrators' award may be entered in any court having jurisdiction. Costs: Each party shall bear its own costs in both the mediation and the arbitration; however, the parties shall share the fees and expenses of both the mediators and the arbitrators equally. 7 City of Fort Worth, Texas Mayor and Council Communication �,:i-e..��..�_—.�` �--..;..__..a__s-_'a —L.. _..��-��.��'�_.:e_�.; z.a-x_s__�-�_ �.,,: «�nrr��.�i:�.� �-����__:�:__»^_: .. � .__.� � ,___ _ ._:_.�. .�� COUNCIL ACTION: Approved on 7/10/2007 DATE: Tuesday, July 10, 2007 LOG NAME: 35CCPDAUDIT z_ -,.�_�z.�.._�.��� __. ^ -- REFERENCE NO.: C-22244 SUBJECT: Authorize Execution of an Agreement for Professional Services with Deloitte & Touche, LLP, for Audit Services Requested by the Crime Control and Prevention District Board �:-__ _ �.T - ..�.._��:.�:� ���:��-.,�_ __���_ y_._., __ .�--�._�._��v=-=- -_ =� RECOMMENDATION: It is recommended that the City Council: 1. Authorize the City Manager to execute an Agreement For Professional Services with Deloitte & Touche, LLP, for an audit of select Crime Control and Prevention District programs operated for the fiscal year ending September 30, 2005; and 2. Authorize payments not to exceed $25,000 to Deloitte & Touche, LLP, for certain agreed upon procedures perFormed relative to this audit. DISCUSSION: The purpose of this Mayor and Council Communication is to authorize execution of an Agreement for Professional Services for independent audit services to be provided by the external auditor, Deloitte & Touche, LLP, for the fiscal year ending September 30, 2005. On December 12, 2006, (M&C G-15528) the City Council approved a mid-year amendment, inclusive of funds for a Crime Control and Prevention District (CCPD) program audit. On February 15, 2007, the CCPD Board established a list of agreed upon procedures. On June 7, 2007, the audit scope and priorities were finalized by the CCPD Board with the following programs identified for review: Gang Graffiti Abatement, Expanded Narcotics, Code: Blue, Special Events Overtime, Homeland Security, School Security Initiative, Weapons and Vehicles. The CCPD Board has requested this audit and wants to have the results of the audit to review and consider as part of its fiduciary responsibility over the fund. FISCAL INFORMATION/CERTIFICATION: The Finance Director certifies that funds are available in the current operating budget, as appropriated, of the Crime Control and Prevention District Fund. Logname: 35CCPDAUDIT Page 1 of 2 TO Fund/Account/Centers Submitted for City Manager's Office bv: Originating Department Head: Additional Information Contact: FROM Fund/Account/Centers GR79 539120 0351000 $25,000.00 Joe Paniagua (6191) Ralph Mendoza (4210) Kara Shuror (4221) Logname: 35CCPDAUDIT Page 2 of 2