HomeMy WebLinkAboutIR 7621 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 7621
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A To the Mayor and Members of the City Council June 23, 1992
ion Subject: Response to Questions Regarding Proposed Contract with Day
Care Association
I.R. No. 7609 dated May 26, 1992 presented to the City Council the following information about the
proposed contract with Day Care Association:
■ The contract is for brokered day-care services
• There are 9 Day Care Association Centers and 114 member centers providing services.
38% of the member centers are owned by minorities or women.
■ Of the 740 children placed in day-care through the broker in the present year's program
33 were placed in Day Care Association Centers and 707 were placed in member centers.
Any day-care center that is licensed by the state can choose to be a member- there are
no additional requirements dictated by Day Care Association and no fee is charged the
member centers.
The proposed daily rate per child paid by The Working Connection is $14.20, Day Care
Association keeps $1.55 as an administration fee and passes the balance ($12.65) to the
member center caring for the child. (Mis is a $.05 reduction in the administration fee
from the current contract.)
The estimated expenditures under this contract are$250,000. Of that,based on present year's experience
we can project $213,600 will be passed through Day Care Association to the 114 member providers;
$36,400 will be earned by Day Care Association.
114 Member providers @$ 12.65 per child per day $ 213,600
9 Day Care Association Centers @$ 12.65 per child per day $ 8,900
Administrative fee to Day Care Association @$1.55 per child $ 27,500
Total Estimated Contract $ 250,000
Total estimated amount earned by Day Care Association $ 36,400
The decision was made in 1987 to establish a brokered system of providing day-care services for clients
of The Working Connection. Previously, a list of eligible providers was maintained by The Working
Connection;clients selected a provider from that list based on personal preference,convenience and space
availability-,The Working Connection paid each provider monthly upon receipt of invoices. The payment
process involved reviewing and reconciling the invoices, monitoring the centers, causing checks to be
produced and sent. Monthly payments to providers often were not made in a timely fashion causing cash
flow problems for the providers, most of whom were small businesses.
By going to the brokered system, The Working Connection is now able to rely on the broker, Day Care
Association,to review and reconcile the invoices submitted by each provider. Only one check is processed
to Day Care Association. Day Care Association is responsible for payment to member centers. The
number of complaints received by the City for late payment has been all but eliminated. At the same
time, The Working Connection clients continue to self-select day-care centers for their children . And ,
over time,the number of centers from which to choose has continued to increase,making the service even
more convenient.
ISSUED BY THE CITY MANAGER FORT WORTH,TEXAS
INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 7621
op To the Mayor and Members of the City Council June 23, 1992
z Page 2 of 2
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(0 Subject:
Im Response to Questions Regarding Proposed Contract with Day
Care Association
In soliciting bids, fifty-two agencies were notified and only one, the Day Care Association, responded.
Approximately thirty of the vendors not responding were contacted by telephone. The majority are
members of Day Care Association and will receive their portion of the children through the Association.
Others who are not members declined to bid because they do not offer a brokerage type service. Some
contacted stated they are not full day-care centers but only operate a limited number of hours.
Approval of this contract will make day-care services available for The Working Connection clients in a
convenient, cost-effective manner. It removes the bulk of the administration required to provide this
service from the City and places it in the private sector. The bid submitted by Day Care Association is
in compliance with the City's DBE Policy. The contract has been reviewed by the Private Industry Council
and they recommend it be approved.
At the Pre-Council meeting on June 9, 1992, the City Attorney was asked to provide an opinion on
whether the Council can require a potential vendor to provide information on the level of DBE
participation on non-City related business. An execuitve session has been scheduled on the June 23,1992
agenda so that the City Attorney can brief the City Council on this matter.
Please feel free to contact me if you are in need of additional information.
OPL
b Terre
TerjeV'�t
Acting City Manager
ISSUED BY THE CITY MANAGER FORT WORTH,TEXAS