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Home My WebLink AboutIR 7764 _00k 1944� INFORMAL REPORT TO CITY uOUNCIL MEMBERS No. 7764 *oTo the Mayor and Members of the City Council October 5, 1993 A x Subject: KENNEL SERVICES CONTRACT FEE INCREASE REQUEST Ian On June 20, 1993, Mr. James Bias, Executive Director, Humane Society of North Texas, notified Dr. James Agyemang, Animal Control Manager, of the Humane Society's intent to request a fee increase in the kenneling contract to $5.00 per day. That request was later changed to $4.32 per day. Mr. Bias noted that the current fee of $3.00 per day for a non-quarantined animal, up to a maximum of three days, did not cover the cost of the impoundment. He requested that the fee be increased to $4.32 per day for a maximum of three days. This report is a response to the fee increase request. To provide background on the kenneling issue, the history of the events leading up to the decision to contract for kenneling services is given. Next the request of the Humane Society to increase fees is discussed, followed by a projection of the contract costs. The cost of contracting for kenneling services is then compared to the cost to the City for constructing and operating an Animal Control Center. Finally, a summary of kenneling service options are listed with a recommendation on the option to execute. BASIS FOR ANIMAL CONTROL PROGRAM The Health and Safety Code of Texas, Chapter 826, Section 826.017 requires the governing body of a municipality to designate a local health authority to address a rabies control program. In responding to this requirement, the City of Fort Worth adopted Chapter 6, "Animals and Fowl", in the City Code to establish the procedures by which the Animal Control Program operates. From the early 1950's until January 1992, the City of Fort Worth operated an animal kennel. The kennel services were provided from four facilities: 1) A house built in 1946, approximately 896 square feet, served as the office for the clerical staff and program administrator; 2) A kennel built in 1951 housed the impounded animals in approximately 5,904 square feet; 3) An observation ward, which previously served as a quarantine ward until March 1980, housed small puppies and kittens in approximate- ly 1,224 square feet; 4) Around 1985, a single-wide mobile trailer, 720 square feet, was moved in. The trailer served as office space for 16 field officers, 2 assistant supervisors and 4 kennel staff. HISTORY In 1985 a preliminary plan to build an Animal Control Facility to replace the City's deteriorating 40-year old facility was submitted for approval on the Capital Im- provement plan. The facility was projected to have 18,000 square feet and cost $1.4 million. Functional serviceability of the facility was estimated to the y F M I --- CORD ol T CORD Cff SECRETARY ' W 0 R 3H ISSUED BY THE CITY MANAGER FORT AM% INFORMAL REPORT TO CITY tOUNCIL MEMBERS No. 7764 &J,RTE!4% t®r_ _% To the Mayor and Members of the City Council October 5, 1993 bA Page 2 of 8 X Subject: KENNEL SERVICES CONTRACT FEE INCREASE REQUEST new facility documents were prepared by Freeman and Frantz Associates. The decision was made not to include the proposed shelter in the 1986 Capital Improve- ment Plan bond election. From 1987 through 1988, Council investigated alternatives for providing kenneling services. On January 3, 1989, preliminary plans for the site development and construction, of a full-service Animal Control Facility were presented to Council; the facility was to encompass 17,500 square feet at a cost of $1.5 million. On October 10, 1989, Council approved the purchase of a three acre parcel at 4900 Martin Street. By this time the City had spent$220,000 in developing plans and purchasing land for the Animal Control Facility. On January 22, 1991, seeking the least costly short-term option, Council authorized the City Manager to issue a Request for Proposal (RFP) for Provision of Kennel Services. Three options were listed in the RFP: 1) Lease-purchase of an Animal Control Facility; 2) Construction of a City Owned Animal Control Facility; and 3) Contracting for Kennel Services with public/private agencies. After review of the options by Council on June 25, 1991, the City Manager was authorized to negotiate a contract with the Humane Society for the kenneling, euthanasia and disposal of animals. The Kenneling Services contract was executed on September 17, 1991. The initial term of the contract was for three years from the date of execution. The City reserved the right, as its sole option, to renew the agreement at the end of the initial term for a period of two years. On December 27, 1991, Fort Worth Animal Control started delivering animals to the Humane Society on a limited basis. On January 10, 1992, the Fort Worth Animal Shelter was closed (Exhibit 1, Kennel Services Timetable). FEE INCREASE REQUEST On June 20, 1993, the Humane Society submitted a request for an increase in the kenneling charges to the City. The initial request of the Society was for the City to increase payment for the following activities: Section 4.01 - City agrees to pay Society $5.00 (currently $3.00) per day per non-quarantined animal, up to a maximum of three (3) days, exclusive of the date of delivery by City, OFFicIA4 CORD SECRETARY CITY SECKTARy 11 LFT. WORM 0 TES. lily ISSUED BY THE CITY MANAGER FORT WORTH,TEXAS INFORMAL REPORT TO CITY %,OUNCIL MEMBERS No. 7764 To the Mayor and Members of the City Council October 5, 1993 Page 3 of 8 X Subject: KENNEL SERVICES CONTRACT FEE INCREASE REQUEST tan Section 4.02 - For non-owned animals quarantined for rabies or other such observation at the insistence of the City, City agrees to pay Society $5.00 (currently $3.00) per day per quarantined animal for each day that the City requires the animal to be quarantined. Section 4.04 - Animals picked up by City for delivery to Society at the request of an owner will become the property of Society upon delivery. Society may euthanize such animal upon delivery. No daily charge shall be made to City; however, City shall pay to Society $5.00 (currently $3.00) per animal euthaniz- ed. Written documentation shall be provided by City prior to euthanization. Mr. Bias, Executive Director, Humane Society of North Texas, states that the $5.00 rate is still below the actual cost to the Society. An average cost of daily care for animals received from the City is $5.47, according to Mr. Bias. The Society is requesting that the sections listed above be changed effective October 1, 1993. Because the contract with the Humane Society limits the amount of increase to the "actual cost increase" from year one of the contract, not the actual cost, Mr. Bias submitted a second request on July 25, 1993 to Ben Allen, Purchasing Director (Exhibit 2). In this request, Mr. Bias identifies the amount of the eligible increase to be a 44% increase over year one cost or $4.32. Mr. Bias does state that the Society would continue to experience a shortfall on the City contract at the $4.32 rate, which may result in the Society re-evaluating the merit of the contract. The City may want to re-evaluate the level of Humane Society staffing assigned to the contract. Initially, 7 full-time equivalents (FTE) were charged to the contract. Now the staff charged to the contract totals 13.5 FTE. Both the Purchasing Division staff and the Public Health Department staff have reviewed the documentation submitted by the Humane Society. Staff of both departments agree that the figures support the 44% increase in fee reimbursement requested by the Humane Society. Projections of Contract Costs In FY 91-92, kenneling costs totaled $83,984 for a nine month period - January 1992- September 1992. In the current fiscal year for the same nine month period, costs are estimated to be $76,633; 1992-93 annual kenneling costs are projected to total $101,536. In Table 1, kenneling costs are projected for the next 3 years, applying current terms of the contract versus revised terms allowing the proposed increase and a 5% increase thereafter for each year that follows. Costs are be sed nn the current OFFICIAL RECORD CITY SECRETARY ISSUED BY THE CITY MANAGER AWN0,4EUX INFORMAL REPORT TO CITY MEMBERS No. 7764 T To the Mayor and Members of the City Council October 5, 1993 Page 4 of 8 Subject: KENNEL SERVICES CONTRACT FEE INCREASE REQUEST staffing level of Animal Control field officers. Therefore, no change in animals kenneled is anticipated. TABLE 1 ACTUAL, PROPOSED AND ESTIMATED HUMANE SOCIETY CONTRACT KENNELING COSTS FISCAL YEARS 1993-96 Current Proposed Contract Increase Estimated Costs* COST FACTORS FY 93-94 FY 93-94 FY 94-95 FY 95-96 Estimated Annual impoundment 13,500 13,500 13,500 13,500 Cost Per Animal Per Day $3.00 $4.32 $4.54 $4.77 No. of Days Animal is Held 3 3 3 3 Projected Cost to City $174,960 $183,870 $193,185 lUnfunded Balance <$53,460> <$62,370> <$71,685> I I zi *94-95 and 95-96 figures include projected 5% annual increase in contract costs. In the proposed FY 93-94 Animal Control Budget, $64,320 is budgeted for the kenneling service contract. Fees collected by the Humane Society are applied against the contract. These revenues are projected to be $57,180 in FY 93-94. Adding the General Fund appropriation to the projected revenues collected by the Humane Society covers the $121,500 cost under the current contract terms. Application of fees collected by the Humane Society against kenneling service costs is consistent with the terms of the contract for fee collection. The fee increase requested by the Humane Society increases the kenneling services contract by $53,460 in FY 93-94, $62,370 in FY 94-95, and $71,685 in FY 95-96. A comparison of the estimated Humane Society kenneling costs for FY 93-94 to anticipated revenues is shown in Table 2. OFFICIAL RECORD Ry CITY SECRETARY_ I[FT. WORTH, JJRX ISSUED BY THE CITY MANAGER FORT WORTH,TEXAS �r INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 7764 ' GiC.RTERp� To the Mayor and Members of the City Council October 5, 1993page 5 of 8 Subject: KENNEL SERVICES CONTRACT FEE INCREASE REQUEST 1873 TABLE 2 ESTIMATED HUMANE SOCIETY CONTRACT KENNELING COSTS VS. ESTIMATED REVENUES FISCAL YEAR 93-94 Current Proposed Contract I ncrease Cost Factors FY 93-94 FY 93-94 Projected Cost to City $121,500 $174,960 Funding: General Fund 64,320 117,780 HS Fee Collection 57.180 57,180 $121,500 ' $174,960 CONSTRUCTION OF ANIMAL CONTROL FACILITY An option the City may consider is the construction of a City owned and operated kennel. As identified in the history of the kenneling issue, the City has an available site for the Animal Control Center and plans for the construction of the center. Wadkins and Associates estimates that it would take approximately 10 months to build the facility at a cost of $2.1 million (Exhibit 3). The loan amortization analysis, comparing debt service over 5, 10, and 20 years is shown in Exhibit 4. The operational cost to the City of Fort Worth to resume kenneling activities in FY 94- 95 is shown below in Table 3. E L RECORD SECRETARY ORTH, TEX. ISSUED BY THE CITY MANAGER FORT WORTH,TEXAS INFORMAL REPORT TO CITY LOUNCIL MEMBERS No. 7764 �RTEq� r To the Mayor and Members of the City Council October 5, 1993 g Rage 6 of 8 tax Subject: KENNEL SERVICES CONTRACT FEE INCREASE REQUEST TABLE 3 ESTIMATE OF CITY OF FORT WORTH ANIMAL CONTROL DIVISION OPERATIONAL KENNEL COSTS Cost Factors FY 94-95* FY 95-96* Personnel ** $169,305 $177,770 Supplies 19,742 20,729 Contractual 50,148 52,655 Operating Casts $239,195 $251,154 Fee Collections ( 57,180 ) ( 57,180 ) TOTAL - Gen. Fund $182,015 $194,000 * FY 94-95 and FY 95-96 figures include projected 5% increases. ** Provides 8 FTE: 1 Asst. Supervisor, 2 Clerks, 4 Animal Attds., 1 Veterinary Tech. Assuming construction is financed over a twenty year period, operational costs and debt service for FY 94-95 and FY 95-96 are shown in Table 4. TABLE 4 CITY OF FORT WORTH ANIMAL CONTROL DIVISION OPERATIONAL BUDGET AND TWENTY YEAR DEBT SERVICE Cost Factors FY 94-95 FY 95-96 Operational Budget $182,015 $194,000 Debt Service (20 yrs) 61,335 201,338 TOTAL $243,350 $395,338 A comparison of kenneling costs for FY 94-95 and FY 95-96 is shown in Table 5. OFFICIAL RECORD CITY SE'CRE'TARY FT. WORTH, TOL ISSUED BY THE CITY MANAGER FORT WORTH,TEXAS INFORMAL REPORT TO CITY t,%)UNCIL MEMBERS No. 7764 �,AART$'ff� 5 t 993 tobe war To the Mayor and Members of the City Council Oc � 7 of 8 TEXA Subject: KENNEL SERVICES CONTRACT FEE INCREASE REQUEST re» TABLE 5 COMPARISON OF KENNELING COSTS CITY OF FORT WORTH VS. HUMANE SOCIETY FY 1994-95 FY 1995-96 Items City of Humane City of Humane Fort Worth Society Fort Worth Society Operational Costs $182,015 $126,690* $194,000 $136,005* Debt Service 61,335 201 ,338 TOTAL $243,350 $126,690 $395,338 $136,005 *Estimated costs of $183,870 and $193,185 for FY 1994-95 and FY 1995-96 (see table 1) are each reduced by $57,180, estimated Humane Society fee collection. SUMMARY OF OPTIONS The City may consider the following options: Continue to contract at current rate through September 1994, and grant market increase effective October 1, 1994; or Continue to contract at current rate and face possible contract cancellation with one year notice at any point between September 1993 and September 1995; or Continue to contract at current rate through September 1994 while constructing City kenneling facility; or Grant the increase requested, or a portion of the increase requested; or Seek bids on a new contract. SOUL RECQRQ CiYY SECRETARY ISSUED BY THE CITY MANAGER FORT WORTH,TEXAS INFORMAL REPORT TO CITY t,1.)UNCIL MEMBERS No. 7764 Cy'wTe!PD October 5, 1993 To the Mayor and Members of the City Council Page 8 of 8 Subject: KENNEL SERVICES CONTRACT FEE INCREASE REQUEST rats STAFF RECOMMENDATION Staff recommends that the increase in fee be approved, recognizing that the Humane Society can provide kenneling services at a lower cost than the City at the $4.32 rate. Each year the staff will compare the cost of kenneling by contracting versus the cost of a City operated kennel. When the cost factor is lower for a City operated kennel, the contracting of kenneling services may not be an attractive option. 2ob TeB r' 11 City Manager Attachment OFFICIAL RECORD CITY SECRETARY L FT- WORTH, TE)L ISSUED BY THE CITY MANAGER FORT WORTH,TEXAS EXHIBIT 1 KENNEL SERVICES TIMETABLE 1985-1991 Action Qutcome 1985 Preliminary Plan to build an Shelter was not included in 1986 Animal Control Facility sub- Capital Improvement Plan bond muted for approval on Capital election Improvement Plan 1987 Staff requested guidance from Council directed staff to review Council on animal kennel con- the private sector interest in lease/ struction alternatives purchase option and post-con- struction operation of facility Council instructed staff to bring Council selected architect and lease/purchase agreement for new awarded contract for shelter animal shelter to Council design 1988 Council authorized City Manager to RFP was finalized, issued for the send out Request for Proposal for construction and operation of an constructing/operating an Animal Animal Control Facility Control Facility 1989 Preliminary Plans for Animal Con- Council approved contract for trol Facility presented to Council final design for the Animal Control Facility Council approved purchase of Property was withdrawn; negoti- property for $130,680 ations were made for 3-acre parcel at 4900 Martin Street 1990 Humane Society submitted proposal Council reviewed proposal favor- to contract for kenneling services ably 1991 Council considered options for Council awarded contract for provision of kenneling services: kenneling services to Humane 1) City owned/operated kennel; Society, saving $31,943 annual- 2) Humane Society contract for ly; contract executed September kenneling services; 17, 1991; initial term for 3 years 3) Humane Society providing with 2 year roll-over option kenneling services without reserved solely for City to enact cancellation of agreement to sell animals to Texas F:11 RECORD a :ECR]UjQY 11t JJX_ C: list College of Osteopathic a Medicine for research MY SECRETARY LFT. WORTu jnr I 1A, , .10 Au t - t !•K •M i • r • � • , • • ♦ • • M • _ • i • is ; �• • • • Irr • • _ •� r • .• t: � t r � :i• • 1 t " • i • 1 EXHIBIT 3 CITY OF FORT WORTH ANIMAL CONTROL CENTER/PUBLIC HEALTH DEPARTMENT Estimate of Construction Costs GSF $/GSF TOTAL Building Cost: Administration 4,200 85 $357,000 Clinic 7,350 68 499,800 Subtotal 856,800 Fixed Equipment: Administration 114 245 $ 27,930 Clinic - Casework 35 280 9,800 Fixed Cages 100 700 70,000 Subtotal 107,730 Site Improvements: Parking/Paving 29,050 3.90 $113,300 Drainage 70,000 1.25 87,500 Subtotal 200,800 TOTAL CONSTRUCTION COSTS: $3,165,330 Other Cost Estimates Operational: Lone Star Gas $ 6,000 TU Electric 27,000 Water Subtotal 50,000 83,000 Other: GSF $/GSF Fencing 1,080 9 $ 9,720 9,720 Movable Equipment: Administration-Furniture 50,000 Clinic - Cages 71,000 Subtotal 121,000 Alternates: #1 - Canopy 240 55 $ 13,200 #2 - Roof & Vehicle Wash 384 50 19,200 #3 - 100 Kennel Building 3,874 65 251,810 100 Cages 100 800 80,000 Subtotal 364,210 TOTAL OTHER COSTS: 485,210 TOTAL CONSTRUCTION COSTS: $1,650,540 OPERATIONAL COSTS: 83,000 OFFICIAL RECORD PROFESSIONAL FEES: 88,103 CONTINGENCIES: 163,200 CITY SECRETARY ADMINISTRATIVE COSTS: 16,300 GRAND TOTAL: FT. WOR11 $2,001,143 MI TM Source: Wadkins-McDonald & Associates and Suburban Surgical (cages) It is estimated that construction of the facility will take 9-10 months. +.� EXHIBIT 4 LOAN AMORTIZATION PROPOSED NEW FACILITY COST 5 Year Maturity 10 Year Maturity 'ear Principal ROI Interest Total Year Principal ROI Interest Total End M End M 1994 $ 46,405 $ 46,405 1994 $ 53,485 $ 53,485 1995 $ 420,000 2.600 68,460 488,460 1995 $ 210,000 2.600 82,425 292,425 1996 420,000 3.250 56,175 476,175 1996 210,000 3.250 76,283 286,283 1997 420,000 3.700 41,580 461,590 1997 210,000 3.700 68,985 278,985 1998 420,000 3.900 25,620 445,620 1998 210,000 3.900 61,005 271,005 1999 420.000 4.150 8,715 429,715 1999 210,000 4.150 52,552 262,552 $2,100,000 $246,955 $2,347,965 2000 210,000 4.250 43,732 253,732 Annual 2001 210,000 4.450 34,597 244,597 Avg. 3.520 $ 469,593 2002 210,000 4.650 25,042 235,042 2003 210,000 4.750 15,172 225,172 2004 $ 21 Q.000 4.850 v ,5.092 215,092 20 Year Maturity $2,100,000 $518,343 $2,618,370 1994 $ 61,335 $ 61,335 Annual 1995 $ 105,000 2.600 96,338 201,338 Avg. 4.055 $ 261,837 1996 105,000 3.250 93,266 198,266 r J 997 105,000 3.700 89,618 194,618 1998 105,000 3.900 85,627 190,627 1999 105,000 4.150 81,401 186,401 2000 105,000 4.250 76,991 181,991 2001 105,000 4.450 72,424 177,424 2002 105,000 4.650 67,646 172,646 2003 105,000 4.750 62,711 167,711 2004 105,000 4.850 57,671 162,671 2005 105,000 4.950 52,526 157,526 2006 105,000 5.050 47,276 152,276 2007 105,000 5.150 41,921 146,921 2008 105,000 5.200 36,488 141,488 2009 105,000 5.250 31,001 136,001 flffl�l�� RE�ORQ 2010 105,000 5.300 25,463 130,463 2011 105,000 5.350 19,871 124,871 vR SECRUARY 2012 105,000 5.400 14,227 119,227 flQR , IM 2013 105,000 5.400 8,557 113,557 RX x`.014 1 5.O00 5.250 2.861 $ 107,861 $2,100,000 $1,125,219 $3,225,219 Annual Avg. 4.6425 $ 161,261 Source: First Southwest Company, Dallas, TX