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Home My WebLink AboutStaff Report 3.E 04/01/2019zs5$ DATE: April 1, 2019 TO: FROM: Honorable Mayor and Members of the City Council through City Manager Corey Garberolio, Finance Director Janine Tedrow, Finance and Accounting Manager SUBJECT: Resolution Authorizing the City Manager to Enter into a Professional Services Agreement with Badawi & Associates to Provide Audit Services to the City for the Fiscal Year Ending June 30, 2019 with Two Potential One -Year Renewals RECOMMENDATION It is recommended that the City Council adopt the attached Resolution authorizing the City Manager to enter into a professional services agreement with Badawi & Associates to provide audit services to the City of Petaluma for the fiscal year ending June 30, 2019 with two potential one-year renewals. BACKGROUND The City is required to have an annual financial audit performed by an independent outside accounting firm. The firm MAZE and Associates has been the City's auditor since 2011. Their contract ended June 30, 2018. A Request for Proposal for audit services was issued on January 24, 2019, and in response, six proposals were received. The agreement proposed will use the City's standard Professional Services Agreement, with any modifications to the standard form subject to the approval of the City Manager and City Attorney. Services for fiscal year ending June 30, 2019 will be provided at an amount not to exceed $64,955. If the City decides to renew for one or more years, services for the fiscal year ending June 30, 2020 will not exceed $66,095 and services for the fiscal year ending June 30, 2021 will not exceed $675315, totaling a three year not -to -exceed amount.of $198,365. DISCUSSION The audit proposals were received on February 19, 2019. An evaluation was conducted by department staff based on the following point system: understanding of the work to be performed (20 points); experience auditing local governments (30 points); qualifications of partners, managers, and staff (20 points); additional information (10 points); and, cost (20 points). Based on the selection criteria and the evaluation provided by department staff, the firm of Badawi & Associates received the highest number of points. In particular, Badawi & Associates scored well for their depth of experience in providing audit service to local government agencies. FINANCIAL IMPACTS The not -to -exceed cost for the fiscal year ending June 30, 2019 is $64,955. This is a reduction in cost of approximately $22,000 from the not to exceed cost of the audit services provided for the fiscal year ending June 30, 2018. If the City decides to renew for an additional two years, services for all three years will not exceed $198,365, resulting in budget savings of approximately $60,000 from what the City is currently paying over the three year period. ATTACHMENTS 1. Resolution Exhibit A to the Resolution: Cost Proposal (Scope of Services) ATTACHMENT 1 RESOLUTION AUTHORIZING THE CITY MANAGER TO ENTER INTO A PROFESSIONAL SERVICES AGREEMENT WITH BADAWI & ASSOCIATES TO PROVIDE AUDIT SERVICES TO THE CITY OF PETALUMA FOR THE FISCAL YEAR ENDING JUNE 30, 2019 WITH TWO POTENTIAL ONE YEAR RENEWALS WHEREAS, the City has solicited bids from audit firms to provide audit services for the City of Petaluma; and WHEREAS, the City has received proposals from six audit firms; and WHEREAS, the City has evaluated the proposals and selected Badawi & Associates as the contract awardee. NOW, THEREFORE, BE IT RESOLVED that the City Council authorizes the City Manager to enter into a Professional Services Agreement acceptable to the City Manager and City Attorney with Badawi & Associates to provide audit services, pursuant to the scope of services provided by Badawi & Associates attached as Exhibit A to this resolution and incorporated herein, for the fiscal year ending June 30, 2019 in an amount not to exceed $64,955, and for two renewal periods at the City's sole discretion, not to exceed $66,095 for the fiscal year ending June 30, 2020 and $67,315 for the fiscal year ending June 30, 2021. 9 C" ----- --- — -- --- SEALED DOLLAR COST BID PROPOSAL " For Professional Auditing Services for City of Petaluma For fiscal years ending June 30, 2019, with the option to renew the contract for two additional years. February 19, 2019 Contact Person: Ahmed Badawl, CPA Badawi & Associates Certified Public Accountants 180 Grand Avenue, Suite 1600 Oakland, CA 94612 Phone: (510) 768-8244 Pax: (510) 768-8249 E-mail: abadawl a,b-acpa.com t 90>r l' BAIJAWI&ASS OMTES khIM CERTIFIED PUBLIC ACCOUNTANTS v 4 City of Petaluma Cost Proposal Name of Firm and Certification Name of Firm: Badawi & Associates Address: 180 Grand Avenue, Suite 1500 City, State, Zip: Oakland, CA 94612 Contact Name: Ahmed Badawi Contact Telephone Number(s): 510-768-8244 Contact Fax Number(s): 510-768-8249 Contact E-mail Address: abadawiCcbb-acpa.com I, the undersigned, certify I am duly authorized to represent the above named firm and am empowered to submit this bid. In addition, I certify I am authorized to contract with the City on behalf of the above named firm. The Firm will honor the prices listed in this proposal for 180 days from the submittal deadline. Signature Ahmed Badawi Name (print) AI D BADAWI&ASSOCIATES MITWED PUBLIC ACCOUNTANTS President February 19. 2019 Title pate 1 K-) City of Petaluma Cost Proposal Schedule of professional Fees and Total All -Inclusive Maximum Price Service 2019 2020 2021 Audit of City $ 48,390 $ 491160 $ 50,290 1Single Audit Report 4,975 5,025 5,195 Transportation Development Act 3,485 3,590 3,515 State Controller's Report 4,975 5,025 5,195 Transit and Paratransit Report 2,540 2,675 2,470 Gann Limit 590 ( 620 ( 650 Total:! " '$_ 64 955.::$_ 66;095=1 $; 7,31-6 Total 691 �:$ .64,9550 s 668.::;; $66;05.;. -. `648. $:.67;315 Rates for Additional Professional Services: Any services outside the scope of our engagement will be promptly identified before the services are rendered. Upon mutual agreement, the out -of -scope services will be separately billed at our standard hourly rates. While it can be difficult to simply state hourly rates, as often times the needs of the client and the specific tasks directly impact the billing rates for our services, we want to provide the following information regarding our published billing rates: _ — _ ,_-Postfion ., _ r Ho�fly Jtate Partner $ 200 FY2019 ` 200 _: FY 2020 Senior 125 FY -2021 100 IT Hours . Rates ' Am'oupf Hours _Rates- Amount: --Hours,',, Rates ' I CAmounf (Partner ' 69 $ 150 $ 10,350 67 $ 155 $ 10,385 64 $ 160 $ 10,240 Audit Manager 137 120 16,440 ( 132 125 16,500 129 130 16,770 Audit Senior 206 85 17,510 199 ( 90' 17,910 ( 193 95 18,335 Professional Audit Staff ( 253 75 18,975 ( 246 80 19,680 238 ( 85 20,230 �IT Speciplists 21 120 240 1 1 125 1261 1 1 130 130 Administrative Assistant 1 24 1 60 1 1,440 1 23 + 65 1 1,495 1 231 70 ( 1,610 1 Total 691 �:$ .64,9550 s 668.::;; $66;05.;. -. `648. $:.67;315 Rates for Additional Professional Services: Any services outside the scope of our engagement will be promptly identified before the services are rendered. Upon mutual agreement, the out -of -scope services will be separately billed at our standard hourly rates. While it can be difficult to simply state hourly rates, as often times the needs of the client and the specific tasks directly impact the billing rates for our services, we want to provide the following information regarding our published billing rates: _ — _ ,_-Postfion ., _ r Ho�fly Jtate Partner $ 200 EQR 200 Manager 150 Senior 125 Staff 100 IT 150 Admin. 75 Our Standard Hourly Rates are adjusted annually by 3% for Cost of Living and Inflation Adjustments 41 fL10 BADAWI&ASSOCIATES CE R fit -RED PUBLIC ACCO UN AN T$ K N i City of Petaluma Cost Proposal A client relationship with the City will be of great value to our Firm and we welcome the opportunity to develop I a long-term relationship with the City. We are committed to: * Rendering the highest standard of service. * Developing a long-term working relationship dedicated to meeting the needs of the City. * Assisting the City in operational issues. * Producing a quality end -product. We have the technical qualifications and experience to provide the level of service desired and expected by the City and stand ready to provide our knowledge and experience for the benefit of your organization. We would like to express our appreciation to the City and to its Staff for allowing us the opportunity to submit a proposal to perform professional auditing services. We are available, at your convenience, to discuss any I aspects of our proposal. Thank you for allowing us to present our Firm to you. ***************** I PORN 9131�13ADAWL&'ASSOCIATES g ��; rif"I�C7 FUC3ld� A��l�)�J i ANTS I