PSA Indirect Cost Allocation Review with NewGen Strategies-6007-Original Pricing
Docusign City Manager Approval T ransmittal Coversheet
File Name
Purchasing Contact
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
6007
Professional Services Contract for Indirect Cost
Allocation Review with NewGen Strategies
Contract
Karen Smith
PSA 6007
PROFESSIONAL SERVICES AGREEMENT
FOR INDIRECT COST ALLOCATION PLAN REVIEW
PSA 6007
STATE OF TEXAS §
COUNTY OF DENTON §
THIS AGREEMENT is made and entered into _______________________, by and
between the City of Denton, Texas, a Texas municipal corporation, wit h its principal office at
215 East McKinney Street, Denton, Denton County, Texas 76201, hereinafter called “OWNER”
and NewGen Strategies & Solutions , wi th its corporate office at 1300 E. Lookout Drive, Suite
100, Richardson, TX 75082 , hereinafter called “C ONSULTANT,” acting herein, by and through
their duly authorized representatives.
WITNESSETH, that in consideration of the covenants and agreements herein contained,
the parties hereto do mutually agree as follows:
ARTICLE I
EMPLOYMENT OF CONSULTANT
Th e OWNER hereby contracts with the CONSULTANT, as an independent contractor,
and the CONSULTANT hereby agrees to perform the services herein in connection with the
Project as stated in the sections to follow, with diligence and in accordance with the highes t
professional standards customarily obtained for such services in the State of Texas. The
professional services set out herein are in connection with the following described project:
The Project shall include, without limitation, (herein describe proje ct)
ARTICLE II
SCOPE OF SERVICES
The CONSULTANT shall perform the following services in a professional manner:
A. The CONSULTANT shall perform all those services as necessary and as described in the
OWNER’s N/A (describe any request fo r proposal which the OWNER has
utilized to solicit the CONSULTANT’s services), which is attached hereto as Exhibit “A”
and is incorporated by reference as if set forth fully herein.
B. To perform all those serv ices set forth in CONSULTANT’s Proposal dated No vember 3,
2015 which proposal is attached hereto as Exhibit “B” and is incorporated by reference as
if set forth fully herein.
C. CONSULTANT shall perform all those services set forth in indivi dual tasks below:
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Task 1 – Project Kick -off Meeting
NewGen wil l work with the City to schedule a kick -off meeting. The primary reason for
the kick -off meeting is to allow the key Project Team consultants and City stakeholders
to be introduced and lay the general framework for how the study will be conducted. This
mee ting will allow for the finalization of the proposed work approach, as well as discuss
and clarify the issues to be addressed in revising the existing cost allocation
methodologies. So as to reduce the cost to the City, Tasks 1 and 3 may be conducted
simul taneously.
In conducting the study, the Project Team proposes to continue to use the Step Method,
also known as the Double -Step Method, of allocation. In our opinion, this method
provides the greatest accuracy in allocation relative to the cost of develo pment and
administration. During the project kick -off meeting, the Project Team will discuss the
Step Allocation method with the Staff participants and answer any questions that may
arise regarding the allocation methodology.
Task 2 – Development of Data Request
The Project Team will develop an initial data request that we will need to adequately
conduct the analyses required to revise the current CAM. NewGen will issue the initial
data request within two days of the kick -off meeting.
Task 3 – Department Head Interviews and Follow -up Data Requests
To ensure that Project Team members fully understand the operations of each of the
City’s Departments and the activities conducted for which fees are charged, Project Team
members will conduct face -to -face mee tings with the Director of each of the City’s major
departments, and other departmental employees as deemed appropriate by the Director.
These interviews will consist of informal conversations in which the Project Team will
seek to understand the departmen t’s operations, changes in operations subsequent to the
2012 study, changes in departmental organizations subsequent to the last update, and
specific budgeted program responsibilities so as to establish the most appropriate cost
causal allocation factors. Such factors may include, but not be limited to: the number of
invoices or purchase orders processed; the number of contracts awarded or administered;
square footage, number of full time equivalent positions, etc. These meetings will be
conducted over a th ree to four day timeframe. Should follow -up interviews be needed,
these will be conducted via teleconference. Current allocation factor development will be
discussed along with alternative data that may be used in the development of new, more
streamlined a llocation factors.
Upon completion of the department head/program manager interviews, the Project Team
will prepare a supplemental request for information to obtain any additional information
needed to further identify direct and/or indirect costs and to prepare appropriate
allocation factors. It is anticipated that this request will be provided to the City within
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five days of the completion of the interviews. Gathering the data requested will be the
responsibility of the appropriate city employees as des ignated by City management
personnel.
Task 4 – Identification of Direct and Indirect Costs
Upon completion of the department head interviews, the Project Team will identify the
direct and indirect costs provided by each department (or program as require d). During
this process, the Project Team will ensure that no direct costs will be included as indirect
costs and vice -versa in the allocation process.
Task 5 – Determination of Direct and Indirect Cost Allocations
It is NewGen’s understanding that som e of the allocation metrics developed in the 2012
study will need to be streamlined to provide ease of annual development. With that
directive in mind, and the discussion held in Task 3, NewGen Project Team members will
identify and determine the most appr opriate cost allocation factor for each line -item of
the department’s/program’s budget as well as alternative methodologies that provide ease
of annual updates with an acceptable level of accuracy.
Task 6 – Summary Matrix of Costs and Cost Allocation Fac tors
Once the appropriate cost allocation factors have been identified, the Project Team will
develop a summary matrix, illustrating a summary of the expenditures for each “Service
Department” and the total amounts allocated to and across each “End -User Department.”
In addition, NewGen will provide a description of the cost allocation factors that were
used, instructions on the annual development of such factors and the specific budgetary
components impacted.
Task 7 – Draft Report
The Project Team wil l develop a draft report summarizing findings and recommendations
with respect to the development of a revised CAM. NewGen is committed to ensuring
that the City thoroughly understands the recommendations in the draft report and will be
available to discus s findings, answer questions, and receive input. The Project Team will
discuss the findings to City Staff and ensure that these individuals have enough time to
address their concerns and/or questions.
Task 9 – Final Report and Presentations
Upon receipt of City Staff recommendations and comments, the Project Team will make
appropriate changes and provide the City with the final report. After completion of the
final report, the Project Team will be prepared to make a presentation concerning the
findings b efore the City Council or other designated City group.
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Task 10 -Computerized Model and Training
The development of the Cost Allocation Model will occur throughout the course of the
project and will be provided using Microsoft Excel, version 2013. Pr oject Team Members
will deliver the model to City Staff within 30 days of the final project presentation and
conduct an up -to four hour training session on the model’s operation at a time determined
by the City.
Task 11 – Optional Development of Cost All ocation for IT Internal Services Fund
NewGen understands that the City may wish to streamline the current cost allocation
methodology used by the IT Internal Service Fund for cost recovery from all other City
departments and utility services. We have rev iewed the current methodology and have
already identified certain costs areas that may not need to be identified and charged at the
level of specificity that currently is computed.
If authorized to proceed with this optional task, and during our interview s with City
Departmental employees, we will include discussions of how the current IT charges are
used by each department, and where such charges may be aggregated. From these
discussions, we will develop a streamlined approach for discussion with City Sta ff.
If our recommendations are approved, we will develop an Excel based model that can be
used by the IT Internal Service Fund to affect computations utilizing the fully vetted,
streamlined approach. This Model will continue to be separate from the CAM u sed for
allocating the General Fund expenditures.
Deliverables
Upon completion of the proposed study, we will provide the City with the following:
1. Cost Allocation Plan
Draft Electronic Model
Presented within 120 days of notification of award, given the timely receipt of the
requested data, an electronic copy of the draft cost allocation electronic model will be
provided for the City’s review and comment that summarize s the Project Team’s findings
and recommendations. This model will be a rebuild of the existing cost allocation model
to take into account in increased functionality of Microsoft’s 2013 version of Excel.
Draft Report
Presented within one week of revie w of draft cost allocation electronic model so as to
include any changes in the draft cost allocation electronic model.
Final Report
The Final Report and Final Electronic Model will be presented to the City after receipt of
the City’s comments on both the draft model and draft report.
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Presentation of study results to City Council, if required.
Meetings
Pricing reflects a total of two on -site meetings, exclusive of Department Head meetings.
Additionally requested meetings will be provided at time an d expense.
Cost Allocation Model
Two copies on CD of the updated CAM written in the 2013 version of Microsoft Excel.
A four hour training session on -site with live installed model.
2. Optional Services Associated with IT Internal Service Fund
Draft outline of streamlined approach to allocating IT Internal Service Fund expenditures.
Draft Electronic IT Fund Model.
Inclusion of IT Fund results in the Draft Report.
Inclusion of IT Fund results in the Final Report.
A four hour training session for IT employees on use of the Model.
D. If there is any conflict between the terms of this Agreement and the exhibits attached to
this Agreement, the terms and conditions of this Agreement will control over the terms
and conditions of the attached exhibits or ta sk orders.
ARTICLE III
ADDITIONAL SERVICES
(To Be Used if Consultant is an Engineer)
Section not Applicable
ARTICLE III
ADDITIONAL SERVICES
Additional services to be performed by the CONSULTANT, if authorized by the
OWNER, which are not included in th e above -described Basic Services, are described as
follows: (list all additional services that may be required for the project)
A.
ARTICLE IV
PERIOD OF SERVICE
This Agreement shall become effective upon execution of this Agreement by the
OWNER and the CON SULTANT and upon issue of a notice to proceed by the OWNER, and
shall remain in force for the period which may reasonably be required for the completion of the
Project, including Additional Services, if any, and any required extensions approved by the
OWNE R. This Agreement may be sooner terminated in accordance with the provisions hereof.
Time is of the essence in this Agreement. The CONSULTANT shall make all reasonable efforts
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to complete the services set forth herein as expeditiously as possible and to meet the schedule
established by the OWNER, acting through its City Manager or his designee.
ARTICLE V
COMPENSATION
A. COMPENSATION TERMS:
1. “Subcontract Expense” is defined as expenses incurred by the CONSULTANT in
employment of others in outside firms fo r services in the nature of _____N /A __.
2. “Direct Non -Labor Expense” is defined as that expense for any assignment
incurred by the CONSULTANT for supplies, transportation and equipment,
travel, communications, subsistence, and lodging away from home, and sim ilar
incidental expenses in connection with that assignment.
B. BILLING AND PAYMENT: For and in consideration of the professional services to be
performed by the CONSULTANT herein, the OWNER agrees to pay, based on the cost
estimate detail in Exhibit “B ” wh ich is attached hereto and is incorporated by reference as
if set forth fully in this Agreement, a total fee, including reimbursement for direct non -
labor expenses not to exceed $57,000 for Revised Cost Allocation Module and $12,000
for the optional Techn ology Services Internal Service fun Cost Allocation Module .
Partial payments to the CONSULTANT will be made on the basis of detailed monthly
statements rendered to and approved by the OWNER through its City Manager or his
designee; however, under no circu mstances shall any monthly statement for services
exceed the value of the work performed at the time a statement is rendered. The
OWNER may withhold the final five percent (5%) of the contract amount until
completion of the Project.
Nothing contained in this Article shall require the OWNER to pay for any work which is
unsatisfactory, as reasonably determined by the City Manager or his designee, or which is
not submitted in compliance with the terms of this Agreement. The OWNER shall not be
required to ma ke any payments to the CONSULTANT when the CONSULTANT is in
default under this Agreement.
It is specifically understood and agreed that the CONSULTANT shall not be authorized
to undertake any work pursuant to this Agreement which would require additional
payments by the OWNER for any charge, expense, or reimbursement above the
maximum not to exceed fee as stated, without first having obtained written authorization
from the OWNER. The CONSULTANT shall not proceed to perform the services listed
in Article I II “Additional Services,” without obtaining prior written authorization from
the OWNER.
C. ADDITIONAL SERVICES: For additional services authorized in writing by the
OWNER in Article III, the CONSULTANT shall be paid based on the Schedule of
Charges at an ho urly rate shown in Exhibit “C.” Payments for additional services shall
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be due and payable upon submission by the CONSULTANT, and shall be in accordance
with subsection B hereof. Statements shall not be submitted more frequently than
monthly.
D. PAYMENT: I f the OWNER fails to make undisputed payments due the CONSULTANT
for services and expenses within thirty (3 0) days after receipt of the CONSULTANT’s
undisputed statement thereof, prompt payment act interest as set forth in Chapter 2251 of
the Texas Governm ent Code shall be paid on the amounts due the CONSULTANT . I n
addition, the CONSULTANT may, if it has not received payment by the thirty -first (31 st )
day after receipt of payment, after giving ten (10 ) days’ written notice to the OWNER,
suspend services un der this Agreement until the CONSULTANT has been paid in full all
amounts due for services, expenses, and charges, provided, however, nothing herein shall
require the OWNER to pay prompt payment act interest if the OWNER has a bona fide
dispute with the CO NSULTANT concerning the payment or if the OWNER reasonably
determines that the work is unsatisfactory, in accordance with this Article V,
“Compensation.”
ARTICLE VI
OBSERVATION AND REVIEW OF THE WORK
The CONSULTANT will exercise reasonable care and due d iligence in discovering and
promptly reporting to the OWNER any defects or deficiencies in the work of the
CONSULTANT or any subcontractors or subconsultants.
ARTICLE VII
OWNERSHIP OF DOCUMENTS
All documents prepared or furnished by the CONSULTANT (an d CONSULTANT’s
subcontractors or subconsultants) pursuant to this Agreement are instruments of service, and
shall become the property of the OWNER upon the termination of this Agreement. The
CONSULTANT is entitled to retain copies of all such documents. The documents prepared and
furnished by the CONSULTANT are intended only to be applicable to this Project, and
OWNER’s use of these documents in other projects shall be at OWNER’s sole risk and expense.
In the event the OWNER uses any of the information o r materials developed pursuant to this
Agreement in another project or for other purposes than specified herein, CONSULTANT is
released from any and all liability relating to their use in that project.
ARTICLE VIII
INDEPENDENT CONTRACTOR
CONSULTANT shal l provide services to OWNER as an independent contractor, not as
an employee of the OWNER. CONSULTANT shall not have or claim any right arising from
employee status.
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ARTICLE IX
INDEMNITY AGREEMENT
The CONSULTANT shall indemnify and save and hold harmle ss the OWNER and its
officers, agents, and employees from and against any and all liability, claims, demands, damages,
losses, and expenses, including, but not limited to court costs and reasonable attorney fees
incurred by the OWNER, and including, withou t limitation, damages for bodily and personal
injury, death and property damage, resulting from the negligent acts or omissions of the
CONSULTANT or its officers, shareholders, agents, or employees in the execution, operation, or
performance of this Agreem ent.
Nothing in this Agreement shall be construed to create a liability to any person who is not
a party to this Agreement, and nothing herein shall waive any of the parties’ defenses, both at
law or equity, to any claim, cause of action, or litigation f iled by anyone not a party to this
Agreement, including the defense of governmental immunity, which defenses are hereby
expressly reserved.
ARTICLE X
INSURANCE
During the performance of the services under this Agreement, CONSULTANT shall
maintain the fo llowing insurance with an insurance company licensed to do business in the State
of Texas by the State Insurance Commission or any successor agency that has a rating with Best
Rate Carriers of at least A VII or better :
A. Comprehensive General Liability Insur ance with bodily injury limits of not less than
$500,000 for each occurrence and not less than $500,000 in the aggregate, and with
property damage limits of not less than $100,000 for each occurrence and not less than
$100,000 in the aggregate.
B. Automobile Liability Insurance with bodily injury limits of not less than $500,000 for
each person and not less than $500,000 for each accident, and with property damage
limits of not less than $100,000 for each accident.
C. Worker s ’ Compensation Insurance in accordan ce with statutory requirements, and
Employers’ Liability Insurance with limits of not less than $100,000 for each accident.
D. Professional Liability Insurance with limits of not less than $1,000,000 annual aggregate.
E. The CONSULTANT shall furnish insurance certificates or insurance policies at the
OWNER’s request to evidence such coverages. The General Liability and Auto Liability
insurance policies shall name the OWNER as an additional insured , and shall contain a
provision that all required insurance poli cies shall not be canceled or modified without
thirty (30) days’ prior written notice to OWNER and CONSULTANT. In such event, the
CONSULTANT shall, prior to the effective date of the change or cancellation, serve
substitute policies furnishing the same co verage.
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ARTICLE XI
ARBITRATION AND ALTERNATE DISPUTE RESOLUTION
The parties may agree to settle any disputes under this Agreement by submitting the
dispute to mediation. No mediation arising out of or relating to this Agreement may proceed
without the agreement of both parties to submit the dispute to mediation. The location for the
mediation shall be the City of Denton, Denton County, Texas unless a different location is
agreed to by the parties.
ARTICLE XII
TERMINATION OF AGREEMENT
A. Notwithstanding any other provision of this Agreement, either party may terminate by
giving thirty (30) days’ advance written notice to the other party.
B. This Agreement may be terminated in whole or in part in the event of either party
substantially failing to fulfill its obligations under this Agreement. No such termination
will be affected unless the other party is given (1) written notice (delivered by certified
mail, return receipt requested) of intent to terminate and setting forth the reasons
specifying the non -perf ormance, and not less than thirty (30) calendar days to cure the
failure; and (2) an opportunity for consultation with the terminating party prior to
termination.
C. If the Agreement is terminated prior to completion of the services to be provided
hereunder, CONSULTANT shall immediately cease all services and shall render a final
bill for services to the OWNER within thirty (30) days after the date of termination. The
OWNER shall pay CONSULTANT for all services properly rendered and satisfactorily
performed and for reimbursable expenses to termination incurred prior to the date of
termination, in accordance with Article V “Compensation.” Should the OWNER
subsequently contract with a new consultant for the continuation of services on the
Project, CONSULTANT s hall cooperate in providing information. The CONSULTANT
shall turn over all documents prepared or furnished by CONSULTANT pursuant to this
Agreement to the OWNER on or before the date of termination, but may maintain copies
of such documents for its use.
ARTICLE XIII
RESPONSIBILITY FOR CLAIMS AND LIABILITIES
Approval by the OWNER shall not constitute, nor be deemed a release of the
responsibility and liability of the CONSULTANT, its employees, associates, agents,
subcontractors, and subconsultants for t he accuracy and competency of their designs or other
work; nor shall such approval be deemed to be an assumption of such responsibility by the
OWNER for any defect in the design or other work prepared by the CONSULTANT, its
employees, subcontractors, agent s, and consultants. CONSULTANT retains design
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responsibility and liability at all times during this Agreement and after completion of this
Agreement.
ARTICLE XIV
NOTICES
All notices, communications, and reports required or permitted under this Agreemen t
shall be personally delivered or mailed to the respective parties by depositing same in the United
States mail to the address shown below, certified mail, return receipt requested, unless otherwise
specified herein. Mailed notices shall be deemed commun icated as of three (3) days’ mailing:
To CONSULTANT: To OWNER:
NewGen Strategies & Solutions City of Denton
Mr. Chris Ekrut George C. Campbell, City Manager
1300 E. Lookout Dr, Suite 100 215 East McKinney
Richardson, TX 75082 Denton, Texas 76201
All notices shall be deemed effective upon receipt by the party to whom such notice is
given, or within three (3) days’ mailing.
ARTICLE XV
ENTIRE AGREEMENT
This Agreement, consisting of 23 pages and one (1) exhibits, constitutes the complete a nd
final expression of the agreement of the parties, and is intended as a complete and exclusive
statement of the terms of their agreements, and supersedes all prior contemporaneous offers,
promises, representations, negotiations, discussions, communicatio ns, and agreements which
may have been made in connection with the subject matter hereof.
ARTICLE XVI
SEVERABILITY
If any provision of this Agreement is found or deemed by a court of competent
jurisdiction to be invalid or unenforceable, it shall be con sidered severable from the remainder of
this Agreement and shall not cause the remainder to be invalid or unenforceable. In such event,
the parties shall reform this Agreement to replace such stricken provision with a valid and
enforceable provision which comes as close as possible to expressing the intention of the stricken
provision.
ARTICLE XVII
COMPLIANCE WITH LAWS
The CONSULTANT shall comply with all federal, state, and local laws, rules,
regulations, and ordinances applicable to the work covered he reunder as they may now read or
hereinafter be amended.
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ARTICLE XVIII
DISCRIMINATION PROHIBITED
In performing the services required hereunder, the CONSULTANT shall not discriminate
against any person on the basis of race, color, religion, sex, national origin or ancestry, age, or
physical handicap.
ARTICLE XIX
PERSONNEL
A. The CONSULTANT represents that it has or will secure, at its own expense, all
personnel required to perform all the services required under this Agreement. Such
personnel shall not be employees or officers of, or have any contractual relations with the
OWNER. CONSULTANT shall inform the OWNER of any conflict of interest or
potential conflict of interest that may arise during the term of this Agreement.
B. All services required hereunder will be performed by the CONSULTANT or under its
supervision. All personnel engaged in work shall be qualified, and shall be authorized
and permitted under state and local laws to perform such services.
C. In those instances deemed necessary by the OWNER, t he CONSULTANT, its employees
and/or its Sub -consultants shall be required to submit to background checks.
ARTICLE XX
ASSIGNABILITY
The CONSULTANT shall not assign any of its scope of work under in this Agreement,
and shall not transfer any of its scope of work under this Agreement (whether by assignment,
novation, or otherwise) without the prior written consent of the OWNER. Should the
CONSULTANT assign any part of the monies due under this Agreement, CONSULTANT is
required to provide written notice of the same to OWNER. Any assignment of monies due under
this Agreement shall not change any of the terms or conditions of this Agreement to include but
not limited to the terms and conditions for payment under this Agreement.
ARTICLE XXI
MODIFICATION
No waiver or modification of this Agreement or of any covenant, condition, or limitation
herein contained shall be valid unless in writing and duly executed by the party to be charged
therewith, and no evidence of any waiver or modification shall be offered or received in evidence
in any proceeding arising between the parties hereto out of or affecting this Agreement, or the
rights or obligations of the parties hereunder, and unless such waiver or modification is in
writing and duly executed; and the parties further agree that the provisions of this section will not
be waived unless as set forth herein.
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ARTICLE XXII
MISCELLANEOUS
A. The following exhibits are attached to and made a part of this Agreement: (list exhibits)
B. CONSULTANT agrees that OWNER shall, u ntil the expiration of five (5) years after the
final payment or after final completion of all work required under this Agreement,
whichever is longer, have access to and the right to examine any directly pertinent books,
documents, papers, correspondence, to include e -mails, and records of the
CONSULTANT involving transactions relating to this Agreement. CONSULTANT is
required to maintain and make available all electronic records associated with this
Agreement for purposes of examination. CONSULTANT agre es that OWNER shall
have access during normal working hours to all necessary CONSULTANT facilities and
shall be provided adequate and appropriate working space in order to conduct audits in
compliance with this section. OWNER shall give CONSULTANT reasona ble advance
notice of intended audits. This paragraph shall work in conjunction with the Audit
provision set forth in Article XXIII.
C. Venue of any suit or cause of action under this Agreement shall lie exclusively in Denton
County, Texas. This Agreement shall be construed in accordance with the laws of the
State of Texas.
D. For the purpose of this Agreement, the key persons who will perform most of the work
hereunder shall be ______________________________. However, nothing herein shall
limit CONSULTANT f rom using other qualified and competent members of its firm to
perform the services required herein. CONSULTANT understands that OWNER is to be
informed of the removal or loss of any of the key persons working under this Agreement.
CONSULTANT also agrees to provide the OWNER with notice of the name(s) of who it
intends to replace the key person . OWNER shall have a right to reject any replacement
key person(s) and CONSULTANT agrees to name a replacement key person(s)
acceptable to the OWNER.
E. CONSULTANT s hall commence, carry on, and complete any and all projects with all
applicable dispatch, in a sound, economical, and efficient manner and in accordance with
the provisions hereof. In accomplishing the projects, CONSULTANT shall take such
steps as are appr opriate to ensure that the work involved is properly coordinated with
related work being carried on by the OWNER.
F. The OWNER shall assist the CONSULTANT by placing at the CONSULTANT’s
disposal all available information pertinent to the Project, including p revious reports, any
other data relative to the Project, and arranging for the access thereto, and make all
provisions for the CONSULTANT to enter in or upon public and private property as
required for the CONSULTANT to perform services under this Agreemen t.
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Connie Cannady, Chris Ekrut, Matthew Garrett, and Matthew Beale
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G. The captions of this Agreement are for informational purposes only, and shall not in any
way affect the substantive terms or conditions of this Agreement.
ARTICLE XXIII
RIGHT TO AUDIT
The OWNER shall have the right to audit and make copies of the bo oks, records and
computations pertaining to this agreement. The CON SULTANT shall retain such books,
records, documents and other evidence pertaining to this A greement during the contract period
and five years thereafter, except if an audit is in progress or audit findings are yet unresolved, in
which case records shall be kept until all audit tasks are completed and resolved. These books,
records, documents and other evidence shall be available, within 10 business days of written
request. Further, the CO NSULTANT shall also require all Subcontractors, material suppliers,
and other payees to retain all books, records, documents and other evidence pertaining to this
agreement, and to allow the OWNER similar access to those documents. All books and records
w ill be made available within a 50 mile radius of the City of Denton. The cost of the audit will
be borne by the OWNER unless the audit reveals an overpayment of 1% or greater. If an
overpayment of 1% or greater occurs, the reasonable cost of the audit, i ncluding any travel costs,
must be borne by the CON SULTANT which must be payable within five business days of
receipt of an invoice.
Failure to comply with the provisions of this section shall be a material breach of this contract
and shall constitute, in the OWNER’S sole discretion, grounds for termination thereof. Each of
the terms "books", "records", "documents" and "other evidence", as used above, shall be
construed to include drafts and electronic files, even if such drafts or electronic files are
su bsequently used to generate or prepare a final printed document.
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IN WITNESS HEREOF, the City of Denton, Texas has caused this Agreement to be
executed by its duly authorized City Manager, and CONSULTANT has executed this Agreement
through its duly author ized undersigned officer on this the da te ____________________.
CITY OF DENTON, TEXAS
BY: __________________________________
GEORGE C. CAMPBELL, CITY MANAGER
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
BY: __________________________________
APPROVED AS TO LEGAL FORM:
ANITA BURGESS, CITY ATTORNEY
BY: __________________________________
CONSULTANT
BY: _______________________________
AUTHORIZED SIGNATURE, TITLE
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
Director
12/23/2015
PSA 6007 Page 15
CITY OF DENTON
INSURANCE REQUIREME NTS FOR
CONSULTANTS/CONTRACTORS
The Offeror’s /Bidder’s attention is directed to the insurance requirements below. It is highly
recommended that offeror s/bidders confer with their respective insurance carriers or brokers
to determine in advance of its pr oposal or bid submission the availability of insurance
certificates and endorsements as prescribed and provided herein. If an offeror /apparent low
bidder fails to comply strictly with the insurance requirements, that offeror /bidder may be
disqualified fro m award of the contract. Upon award, all insurance requirements shall
become contractual obligations, which the successful offeror/bidder shall have a duty to
maintain throughout the course of this contract.
STANDARD PROVISIONS:
Without limiting any of the other obligations or liabilities of the Consultant/Contractor, the
Consultant/Contractor shall provide and maintain until the contracted work has been completed
and accepted by the City of Denton, Owner, the minimum insurance coverage as indicated
her einafter.
As soon as practicable after notification of award, Consultant/Contractor shall file with the
Purchasing Department satisfactory certificates of insurance, containing the proposal/bid
number and title of the project. Consultant/Contractor may, u pon written request to the
Purchasing Department, ask for clarification of any insurance requirements at any time;
however, Consultants/Contractors are strongly advised to make such requests prior to
proposal/bid opening, since the insurance requirements m ay not be modified or waived after
proposal/bid opening unless a written exception has been submitted with the proposal/bid.
Consultant/Contractor shall not commence any work or deliver any material until he or she
receives notification that the contract has been accepted, approved, and signed by the City of
Denton.
All insurance policies proposed or obtained in satisfaction of these requirements shall comply
with the following general specifications, and shall be maintained in compliance with these
gener al specifications throughout the duration of the Contract, or longer, if so noted:
Each policy shall be issued by a company authorized to do business in the State of
Texas with an A.M. Best Company rating of at least A or better .
Any deductibles or self -insured retentions shall be declared in the proposal or bid. If
requested by the City, the insurer shall reduce or eliminate such deductibles or
self -insured retentions with respect to the City, its officials, agents, employees and
volunteers; or, the Co nsultant/C ontractor shall procure a bond guaranteeing payment of
losses and related investigations, claim administration and defense expenses.
Liability policies shall be endorsed to provide the following:
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PSA 6007 Page 16
Name as additional insured the City of Denton, i ts Officials, Agents,
Employees and volunteers.
That such insurance is primary to any other insurance available to the
additional insured with respect to claims covered under the policy and that this
insurance applies separately to each insured against wh om claim is made or
suit is brought. The inclusion of more than one insured shall not operate to
increase the insurer's limit of liability.
Cancellation: City requires 30 day written notice should any of the policies
described on the certificate be cance lled or materially changed before the
expiration date.
Should any of the required insurance be provided under a claims -made form,
Consultant/Contractor shall maintain such coverage continuously throughout
the term of this contract and, without lapse, for a period of three years beyond
the contract expiration, such that occurrences arising during the contract term
which give rise to claims made after expiration of the contract shall be covered.
Should any of the required insurance be provided under a form of coverage that
includes a general annual aggregate limit providing for claims investigation or
legal defense costs to be included in the general annual aggregate limit, the
Consultant/Contractor shall either double the occurrence limits or obtain
Owners and Contractors Protective Liability Insurance.
Should any required insurance lapse during the contract term, requests for
payments originating after such lapse shall not be processed until the City
receives satisfactory evidence of reinstated coverage as required by this
contract, effective as of the lapse date. If insurance is not reinstated, City may,
at its sole option, terminate this agreement effective on the date of the lapse.
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
PSA 6007
SPECIFIC ADDITIONAL INSURANCE REQUIREMENTS:
All insurance policies pr oposed or obtained in satisfaction of this Contract shall additionally
comply with the following marked specifications, and shall be maintained in compliance with
these additional specifications throughout the duration of the Contract, or longer, if so not ed:
[X ] A. General Liability Insurance:
General Liability insurance with combined single limits of not less than $500,000.00
shall be provided and maintained by the Contractor. The policy shall be written on
an occurrence basis either in a single poli cy or in a combination of underlying and
umbrella or excess policies.
If the Commercial General Liability form (ISO Form CG 0001 current edition) is
used:
Coverage A shall include premises, operations, products, and completed
operations, independent cont ractors, contractual liability covering this
contract and broad form property damage coverage.
Coverage B shall include personal injury.
Coverage C, medical payments, is not required.
If the Comprehensive General Liability form (ISO Form GL 0002 Curren t Edition
and ISO Form GL 0404) is used, it shall include at least:
Bodily injury and Property Damage Liability for premises, operations,
products and completed operations, independent contractors and property
damage resulting from explosion, collapse or underground (XCU)
exposures.
Broad form contractual liability (preferably by endorsement) covering this
contract, personal injury liability and broad form property damage liability.
[X ] Automobile Liability Insurance:
Contractor shall provide Commerci al Automobile Liability insurance with Combined
Single Limits (CSL) of not less than $500,000.00 either in a single policy or in a
combination of basic and umbrella or excess policies. The policy will include bodily
injury and property damage liability ar ising out of the operation, maintenance and use of
all automobiles and mobile equipment used in conjunction with this contract.
Satisfaction of the above requirement shall be in the form of a policy endorsement for:
any auto, or
all owned, hired and n on -owned autos.
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PSA 6007 Page 18
[X ] Workers ’ Compensation Insurance
Contractor shall purchase and maintain Worker's Compensation insurance which, in
addition to meeting the minimum statutory requirements for issuance of such insurance,
has Employer's Liability limits of at least $100,000 for each accident, $100,000 per each
employee, and a $500,000 policy limit for occupational disease. The City need not be
named as an "Additional Insured" but the insurer shall agree to waive all rights of
subrogation against the City, its officials, agents, employees and volunteers for any work
performed for the City by the Named Insured. For building or construction projects, the
Contractor shall comply with the provisions of Attachment 1 in accordance with
§406.096 of the Texas Labor Code and rule 28TAC 110.110 of the Texas Worker's
Compensation Commission (TWCC).
[__] Owner's and Contractor's Protective Liability Insurance
The Contractor shall obtain, pay for and maintain at all times during the prosecution of
the work under this contract, an Owner's and Contractor's Protective Liability insurance
policy naming the City as insured for property damage and bodily injury which may arise
in the prosecution of the work or Contractor's operations under this contract. Coverage
shall be o n an "occurrence" basis, and the policy shall be issued by the same insurance
company that carries the Contractor's liability insurance. Policy limits will be at least
combined bodily injury and property damage per occurrence with a aggregate.
[X ] Prof essional Liability Insurance
Professional liability insurance with limits not less than $1,000,000.00 per claim with
respect to negligent acts, errors or omissions in connection with professional services is
required under this Agreement.
[ ] Environmen tal Liability Insurance
Environmental liability insurance for $1,000,000 to cover all hazards contemplated by this
contract.
[ ] Riggers Insurance
The Contractor shall provide coverage for Rigger’s Liability. Said coverage may be provided by
a Rigger’s Liability endorsement on the existing CGL coverage; through and Installation Floater
covering rigging contractors; or through ISO form IH 00 91 12 11, Rigger’s Liability Coverage
form. Said coverage shall mirror the limits provided by the CGL coverage
[__] Builders' Risk Insurance
Builders' Risk Insurance, on an All -Risk form for 100% of the completed value shall be
provided. Such policy shall include as "Named Insured" the City of Denton and all
subcontractors as their interests may appear.
[__] C ommercial Crime
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PSA 6007 Page 1 9
Provides coverage for the theft or disappearance of cash or checks, robbery inside/outside
the premises, burglary of the premises, and employee fidelity. The employee fidelity
portion of this coverage should be written on a “blanket” basi s to cover all employees,
including new hires. This type insurance should be required if the contractor has access
to City funds. Limits of not less than each occurrence are required.
[__] Additional Insurance
Other insurance may be required on an individual basis for extra hazardous contracts and
specific service agreements. If such additional insurance is required for a specific
contract, that requirement will be described in the "Specific Conditions" of the contract
specifications.
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PSA 6007 Page 20
ATTACHMENT 1
[__] Worker's Compensation Coverage for Building or Construction Projects for
Governmental Entities
A. Definitions:
Certificate of coverage ("certificate")-A copy of a certificate of insurance, a
certificate of authority to self -insure issued by the commission, or a coverage
agreement (TWCC -81, TWCC -82, TWCC -83, or TWCC -84), showing statutory
workers' compensation insurance coverage for the person's or entity's employees
providing services on a project, for the duration of the project.
Duration of the project - includes the time from the beginning of the work on the
project until the contractor's/person's work on the project has been completed and
accepted by the governmental entity.
Persons providing services on the project ("subcontractor" in §406.096) - includes all
persons or entities performing all or part of the services the contractor has
undertaken to perform on the project, regardless of whether that person contracted
directly with the contractor and regardless of whether that person has employees.
This includes, without limitation, independent contractors, subcontractors, leasing
companies, motor carriers, owner -operators, employees of any such entity, or
employees of any entity which furnishes persons to provide services on the project.
"Services" include, without limitation, providing, hauling, or delivering equipment or
materials, or providing labor, transportation, or other service related to a project.
"Services" does not include activities unrelated to the project, such as food/be verage
vendors, office supply deliveries, and delivery of portable toilets.
B. The contractor shall provide coverage, based on proper reporting of classification
codes and payroll amounts and filing of any overage agreements, which meets the
statutory requir ements of Texas Labor Code, Section 401.011(44) for all employees
of the Contractor providing services on the project, for the duration of the project.
C. The Contractor must provide a certificate of coverage to the governmental entity prior
to being awarded the contract.
D. If the coverage period shown on the contractor's current certificate of coverage ends
during the duration of the project, the contractor must, prior to the end of the
coverage period, file a new certificate of coverage with the governmental entity
showing that coverage has been extended.
E. The contractor shall obtain from each person providing services on a project, and
provide to the governmental entity:
1) a certificate of coverage, prior to that person beginning work on the project, so the
g overnmental entity will have on file certificates of coverage showing coverage
for all persons providing services on the project; and
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PSA 6007 Page 21
2) no later than seven days after receipt by the contractor, a new certificate of
coverage showing extension of coverage, if the coverage period shown on the
current certificate of coverage ends during the duration of the project.
F. The contractor shall retain all required certificates of coverage for the duration of the
project and for one year thereafter.
G. The contractor shall notify the governmental entity in writing by certified mail or
personal delivery, within 10 days after the contractor knew or should have known, of
any change that materially affects the provision of coverage of any person providing
services on the projec t.
H. The contractor shall post on each project site a notice, in the text, form and manner
prescribed by the Texas Workers' Compensation Commission, informing all persons
providing services on the project that they are required to be covered, and stating ho w
a person may verify coverage and report lack of coverage.
I. The contractor shall contractually require each person with whom it contracts to
provide services on a project, to:
1) provide coverage, based on proper reporting of classification codes and payrol l
amounts and filing of any coverage agreements, which meets the statutory
requirements of Texas Labor Code, Section 401.011(44) for all of its employees
providing services on the project, for the duration of the project;
2) provide to the contractor, prior to that person beginning work on the project, a
certificate of coverage showing that coverage is being provided for all employees
of the person providing services on the project, for the duration of the project;
3) provide the contractor, prior to the end of the coverage period, a new certificate of
coverage showing extension of coverage, if the coverage period shown on the
current certificate of coverage ends during the duration of the project;
4) obtain from each other person with whom it contracts, and provi de to the
contractor:
a) certificate of coverage, prior to the other person beginning work on the
project; and
b) a new certificate of coverage showing extension of coverage, prior to the
end of the coverage period, if the coverage period shown on the current
certificate of coverage ends during the duration of the project;
5) retain all required certificates of coverage on file for the duration of the project
and for one year thereafter;
6) notify the governmental entity in writing by certified mail or personal del ivery,
within 10 days after the person knew or should have known, of any change that
materially affects the provision of coverage of any person providing services on
the project; and
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PSA 6007 Page 22
7) contractually require each person with whom it contracts, to perform as r equired
by paragraphs (1) - (7), with the certificates of coverage to be provided to the
person for whom they are providing services.
J. By signing this contract or providing or causing to be provided a certificate of
coverage, the contractor is representing to the governmental entity that all employees
of the contractor who will provide services on the project will be covered by workers'
compensation coverage for the duration of the project, that the coverage will be based
on proper reporting of classificati on codes and payroll amounts, and that all coverage
agreements will be filed with the appropriate insurance carrier or, in the case of a self -
insured, with the commission's Division of Self -Insurance Regulation. Providing
false or misleading information m ay subject the contractor to administrative penalties,
criminal penalties, civil penalties, or other civil actions.
K. The contractor’s failure to comply with any of these provisions is a breach of contract
by the contractor which entitles the governmental e ntity to declare the contract void if
the contractor does not remedy the breach within ten days after receipt of notice of
breach from the governmental entity.
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
PSA 6007
CONFLICT OF INTEREST QUESTIONNAIRE - FORM C IQ
For vendor or other person doing business with local governmental entity
This questionnaire reflects changes made to the law by H.B. 23, 84th Leg., Regular Session .
This questionnaire is being filed in accordance with Chapter 176, Local Government Cod e, by a vendor who has a business relationship as
defined by Section 176.001(1 -a) with a local governmental entity and the vendor meets requirements under Section 176.006(a).
By law this questionnaire must be filed with the records administrator of the l ocal government entity not later than the 7th business day after
the date the vendor becomes aware of facts that require the statement to be filed. See Section 176.006(a -1), Local Government Code.
A vendor commits an offense if the vendor knowingly violat es Section 176.006, Local Government Code. An offense under this section is a
misdemeanor.
1 Name of vendor who has a business relationship with local governmental entity.
2
Check this box if you are filing an update to a previously filed questionnaire.
(The law requires that you file an updated completed questionnaire with the appropriate filing authority not later than the 7 th business day after the
date on which you became aware that the originally filed questionnair e was incomplete or inaccurate.)
3 Name of local government officer about whom the information in this section is being disclosed.
Name of Officer
This section, (item 3 including subparts A, B, C & D), must be completed for each officer with whom the vendor has an employment or other business relationship
as defined by Section 176.001(1 -a), Local Government Code. Attach additional pages to this Form CIQ as necessary.
A. Is the local government of ficer named in this section receiving or likely to receive taxable income, other than investment income, from the vendor?
Yes No
B. Is the vendor receiving or likely to receive taxable income, other than investment income, from or at the direction of th e local government officer
named in this section AND the taxable income is not received from the local governmental entity?
Yes No
C. Is the filer of this questionnaire employed by a corporation or other business entity with respect to which the local g overnment officer serves as an
officer or director, or holds an ownership of one percent or more?
Yes No
D. Describe each employment or business and family relationship with the local government officer named in this section.
4
I have no Conf lict of Interest to disclose.
5
Signature of vendor doing business with the governmental entity Date
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
12/23/2015
X
INDIRECT COST ALLOCATION
PLAN REVIEW AND UPDATE
City of Denton, TX
PROPOSAL | November 3, 2015
www.newgenstrategies.net
PREPARED BY:
SUSTAINABILITY STAKEHOLDERS ECONOMICS STRATEGY
PSA 6007
Exhibit B
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
Economics | Strategy | Stakeholders | Sustainability
www.newgenstrategies.net
1300 E Lookout Drive
Suite 100
Richardson, TX 75082
Phone: (972) 680 -2000
November 3, 2015
Mr. Antonio Puente
Assistant Finance Director
City of Denton
215 E. McKinney St.
Denton, Texas 76201
Re: Indirect Cost Allocation Plan Review and Update
Dear Mr. Puente:
NewGen Strategies and Solutions, LLC (NewGen) is pleased to have this opportunity to propose our
assistance to the City of Denton (City) in revising the current indirect cost allocation model (CAM) for the
General Fund, with the option to provide assistance in developing a more streamlined allocation of cost
for the IT Internal Service Fund. The following proposal provides the scope of services that will be
conducted, our proposed project team and the not-to -exceed project costs for both the indirect cost
allocation model development and the development of a cost allocation methodology for the IT
department.
Scope of Services
Task 1 – Project Kick-off Meeting
NewGen will work with the City to schedule a kick-off meeting. The primary reason for the kick-off
meeting is to allow the key Project Team consultants and City stakeholders to be introduced and lay the
general framework for how the study will be conducted. This meeting will allow for the finalization of the
proposed work approach, as well as discuss and clarify the issues to be addressed in revising the existing
cost allocation methodologies. So as to reduce the cost to the City, Tasks 1 and 3 may be conducted
simultaneously.
In conducting the study, the Project Team proposes to continue to use the Step Method, also known as
the Double-Step Method, of allocation. In our opinion, this method provides the greatest accuracy in
allocation relative to the cost of development and administration. During the project kick-off meeting,
the Project Team will discuss the Step Allocation method with the Staff participants and answer an y
questions that may arise regarding the allocation methodology.
Task 2 – Development of Data Request
The Project Team will develop an initial data request that we will need to adequately conduct the analyses
required to revise the current CAM. NewGen will issue the initial data request within two days of the kick-
off meeting.
PSA 6007
Exhibit B
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
Mr. Antonio Puente
November 3, 2015
2 Thoughtful Decision Making for Uncertain Times
Task 3 – Department Head Interviews and Follow-up Data Requests
To ensure that Project Team members fully understand the operations of each of the City’s Departments
and the activities conducted for which fees are charged, Project Team members will conduct face-to -face
meetings with the Director of each of the City’s m ajor departments, and other departmental employees
as deemed appropriate by the Director. These interviews will consist of informal conversations in which
the Project Team will seek to understand the department’s operations, changes in operations subseque nt
to the 2012 study, changes in departmental organizations subsequent to the last update, and specific
budgeted program responsibilities so as to establish the most appropriate cost causal allocation factors.
Such factors may include, but not be limited to: the number of invoices or purchase orders processed; the
number of contracts awarded or administered; square footage, number of full time equivalent positions,
etc. These meetings will be conducted over a three to four day timeframe. Should follow-up interviews
be needed, these will be conducted via teleconference. Current allocation factor development will be
discussed along with alternative data that may be used in the development of new, more streamlined
allocation factors.
Upon completion of the department head/program manager interviews, the Project Team will prepare a
supplemental request for information to obtain any additional information needed to further identify
direct and/or indirect costs and to prepare appropriate allocation factors. It is anticipated that this
request will be provided to the City within five days of the completion of the interviews. Gathering the
data requested will be the responsibility of the appropriate city employees as designated by City
management personnel.
Task 4 – Identification of Direct and Indirect Costs
Upon completion of the department head interviews, the Project Team will identify the direct and indirect
costs provided by each department (or program as required). During this process, the Project Team wi ll
ensure that no direct costs will be included as indirect costs and vice-versa in the allocation process.
Task 5 – Determination of Direct and Indirect Cost Allocations
It is NewGen’s understanding that some of the allocation metrics developed in the 2 012 study will need
to be streamlined to provide ease of annual development. With that directive in mind, and the discussion
held in Task 3, NewGen Project Team members will identify and determine the most appropriate cost
allocation factor for each line-item of the department’s/program’s budget as well as alternative
methodologies that provide ease of annual updates with an acceptable level of accuracy.
Task 6 – Summary Matrix of Costs and Cost Allocation Factors
Once the appropriate cost allocation factors have been identified, the Project Team will develop a
summary matrix, illustrating a summary of the expenditures for each “Service Department” and the total
amounts allocated to and across each “End -User Department.”
In addition, NewGen will provide a description of the cost allocation factors that were used, instructions
on the annual development of such factors and the specific budgetary components impacted.
PSA 6007
Exhibit B
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
Mr. Antonio Puente
November 3, 2015
Thoughtful Decision Making for Uncertain Times 3
Task 7 – Draft Report
The Project Team will develop a draft report summarizing findings and recommendations with respect to
the development of a revised CAM. NewGen is committed to ensuring that the City thoroughly
understands the recommendations in the draft report and will be available to discuss findings, answer
questions, and receive input. The Project Team will discuss the findings to City Staff and ensure that these
individuals have enough time to address their concerns and/or questions.
Task 9 – Final Report and Presentations
Upon receipt of City Staff recommendations and comments, the Project Team will make appropriate
changes and provide the City with the final report. After completion of the final report, the Project Team
will be prepared to make a presentation concerning the findings before the City Council or other
designated City group.
Task 10 -Computerized Model and Training
The development of the Cost Allocation Model will occur throughout the course of the project and will be
provided using Microsoft Excel, version 2013. Project Team Members will deliver the model to City Staff
within 30 days of the final project presentation and conduct an up-to four hour training session on the
model’s operation at a time determined by the City.
Task 11 – Optional Development of Cost Allocation for IT Internal Services Fund
NewGen understands that the City may wish to streamline the current cost allocation methodology used
by the IT Internal Service Fund for cost recovery from all other City departments and utility services. We
have reviewed the current methodology and have already identified certain costs areas that may not need
to be identified and charged at the level of specificity that currently is computed.
If authorized to proceed with this optional task, and during our interviews with City Departmental
employees, we will include discussions of how the current IT charges are used by each department, and
where such charges may be aggregated. From these discussions, we will develop a streamlined approach
for discussion with City Staff.
If our recommendations are approved, we will develop an Excel based model that can be used by the IT
Internal Service Fund to affect computations utilizing the fully vetted, streamlined approach. This Model
will continue to be separate from the CAM used for allocating the General Fund expenditures.
Deliverables
Upon completion of the proposed study, we will provide the City with the following:
1. Cost Allocation Plan
Draft Electronic Model
Presented within 120 days of notification of award, given the timely receipt of the
requested data, an electronic copy of the draft cost allocation electronic model will be
provided for the City’s review and comment that summarizes the Project Team’s findings
PSA 6007
Exhibit B
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
Mr. Antonio Puente
November 3, 2015
4 Thoughtful Decision Making for Uncertain Times
and recommendations. This model will be a rebuild of the existing cost allocation model
to take into account in increased functionality of Microsoft’s 2013 version of Excel .
Draft Report
Presented within one week of review of draft cost allocation electronic model so as to
include any changes in the draft cost allocation electronic model.
Final Report
The Final Report and Final Electronic Model will be presented to the City after receipt of
the City’s comments on both the draft model and draft report.
Presentation of study results to City Council, if required.
Meetings
Pricing reflects a total of two on -site meetings, exclusive of Department Head meetings.
Additionally requested meetings will be provided at time and expense.
Cost Allocation Model
Two copies on CD of the updated CAM written in the 2013 version of Microsoft Excel.
A four hour training session on-site with live installed model.
2. Optional Services Associated with IT Internal Service Fund
Draft outline of streamlined approach to allocating IT Internal Service Fund expenditures.
Draft Electronic IT Fund Model.
Inclusion of IT Fund results in the Draft Report.
Inclusion of IT Fund results in the Final Report.
A four hour training session for IT employees on use of the Model.
PSA 6007
Exhibit B
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
Mr. Antonio Puente
November 3, 2015
Thoughtful Decision Making for Uncertain Times 5
Proposed Project Team
NewGen proposes a four member Project Team. Ms. Connie Cannady will serve as Project Manager, and
she is located in the Amarillo, Texas office. Ms. Cannady will participate in the interview process at the
City, manage the development of all cost allocation methodologies, and be the primary point of contact
with City Staff. She will be assisted by Mr. Matthew Garrett in the Richardson Office, who will also
participate during the interviews and will assist in the development of the allocation methodology. Mr.
Matt Beale, located in our Denver Office, will be responsible for the development of the Excel Model. Mr.
Chris Ekrut will provide the Quality Assurance/Quality Control (QA/QC) as he has significant knowledge of
the City from providing prior consulting services. The Project Team organization and reporting
requirements are as follows:
Proposed Professional Fees and Expense Reimbursement
Based on the project scope, we estimate our professional fees will not exceed $57,000 dollars for the
development of the revised CAM. This includes travel expenses to and from the City for interviews and
scheduled meetings. NewGen estimates that the optional activities to develop a streamlined IT Internal
Service Fund allocation model will not exceed an additional $12,000 dollars, provided that data collection
for this component can be conducted simultaneously with the conduct of interviews concerning the
revised CAM.
The hourly billing rates of the Project Team Members are as follows:
Connie Cannady
QA/QC
Chris Ekrut
Consultant
Matt Beale
Senior Consultant
Matthew Garrett
Project Manager
PSA 6007
Exhibit B
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
Mr. Antonio Puente
November 3, 2015
6 Thoughtful Decision Making for Uncertain Times
Ms. Connie Cannady - $225/hour
Mr. Chris Ekrut - $225/hour
Mr. Matthew Garrett - $160/hour
Mr. Matt Beale - $115/hour
Administrative Staff - $75/hour
NewGen bills its clients based on actual hours worked, plus out-of -pocket expenses. In the event that the
actual hours spent in conducting the enumerated activities are less than those used in the development
of the not-to -exceed proposed costs, the City will be billed only for the actual hours. However, if the
actual hours exceed the estimate, the City will only be billed up to the not-to -exceed cost, plus out-of -
pocket expenses.
Authorization
To the extent that the City is in agreement with the proposed consulting services and the proposed not-
to -exceed project costs for the development of the revised CAM and/or optional IT allocation
methodology, please execute the appropriate section below and send to:
Mr. Chris Ekrut
NewGen Strategies & Solutions
1300 E. Lookout Drive, Suite 100
Richardson, Texas 75082
We appreciate the opportunity to propose our assistance to the City. We believe our professional
experience provides the unique set of qualifications desired by the City. Should you have any questions
regarding this proposal, please do not hesitate to contact me by phone at 972.232.2234 or by email at
cekrut@newgenstrategies.net.
Sincerely,
NewGen Strategies and Solutions, LLC
Chris D. Ekrut
Director, Environmental Practice
PSA 6007
Exhibit B
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
Request for City Manager Approval of Purchase
DATE: December 21, 2015 Questions concerning this
acquisition may be directed to
DEPARTMENT: Materials Management Nancy Towle at 940 - 349 -7709
ACM: Bryan Langley
SUBJECT
Consider approval of a professional services agreement with NewGen Strategies and Solutions,
LLC (formerly J. S towe & C o .) for i ndirect c ost a llocation pla n r eview a nd u pdate , and includ e
the option to develop a streamlined allocation of costs for Technology Service in a not to exceed
amount of $69,000 . (PSA 6007)
BACKGROUND
The current cost allocation plan and model w ere developed by J. Stowe & Co. in 2012. Budge t
receive d a copy of the allocation model per the contract . Budget staff updates the model each
year with the latest internal cost data and develops the annual cost allocation by department.
Since th e allocation model was created , the City has had a numb er of changes to the
organizational structure, costs for the allocable departments have changed, new positions have
been authorized , and other misc ellaneous changes have occurred . All of these can have an
impact on the resulting allocations. A review and update to the cost allocation plan and model
are needed to accommodate these changes and ensure the accuracy, integrity and completeness
of the metrics and the data used in the allocations.
Technology Service has requested to b e included in this professi onal services agreement in order
to develop a streamlined allocation of costs for Technology Service. Their current process of
allocating costs is very time -consuming, labor intensive and heavily dependent on one individual
that is retiring.
Texas Loca l Government Code 252.022(4) allows for an exemption to competitive requirements
for the expenditure of funds for procurement of personal, professional or planning services.
Based on the services offered, NewGen Strategies and Solutions, LLC appears to pr ovide the
best value to the City of Denton.
RECOMMENDATION
Staff recommends approval of a professional services agreement with NewGen Strategies and
Solutions, LLC for indirect cost allocation plan review and update , and to develop an allocation
of cost s for Technology Service .
PRINCIPAL PLACE OF BUSINESS
NewGen Strategies and Solutions, LLC
1300 E. Lookout Drive, Suite 100
Richardson, Texas 75082
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
Request for City Manager Approval
Page 2
ESTIMATED SCHEDULE OF PROJECT
Completion Date : March 2016
CONTRACT ADMINISTRATOR
Nancy Towle
FISCAL INFORMATION
JDE Account Number : 1600 99 .7879
Contract cost: Not to exceed $57,000
Option for Technology Service: $12,000
Total: $69,000
Attachment 1: Contract
Attachment 2: Business Necessity Memo Requested by:
Name : Nancy Towle
Phone : 940 -349 -7709
Requisition # 127353
Respectfully submitted:
Purchasing
Expenditure Approved:
__________________________
City Manager or Designate
__________________________
Date
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
12/23/2015
“Dedicated to Quality Service”
www.cityofde nton.com
AFC Attachment 2
(940) 349 -82 60 * DFW Metro (972) 434 -2259 * Fax (940) 349 -7206
`
MEMORANDUM
DATE: Dece mber 2 2 , 20 1 5
TO: Elton Brock, Purchasing Manager
FROM: Nancy Towle , Budget Manager
SUBJECT: All ocation Plan Review and Update – NewGen Strategies & Solutions , LLC (formerly
J. Stowe & Co.)
The current cost allocation plan w as developed by J. Stowe & Co. in 2012. The proposed Project
Manager will be Connie Cannady, who managed the previous contract . The model uses the Step
Method of allocation. New Gen Strategies & Solutions, LLC has extensive experience , including
Denton, in providing cost allocation service s . Texas Local Government Code 252.022(4) allows for an
exemption to competitive requiremen ts for the expenditure of funds for procurement of personal,
professional or planning services.
New Gen Strategies & Solutions, LLC offers the following :
1. Has provided the City of Denton an in -depth cost allocation plan and model in FY 2012 ;
2. Has a highly experienced Project Team who have worked with Denton in the past.
3. The y use the Step Method of allocation which results in the greatest accuracy relative to the
time and cost of development and administration ;
4. Their model is Excel based which makes it easy to understand and update.
In total and based on the services offered , New Gen Strategies & Solutions, LLC appears to provide
the best value to the City of Denton.
I f you have any questions , or need additional information, please let me know .
Finance Department * 215 E. McKinney * Denton, TX 76201
DocuSign Envelope ID: C5E9722D-8494-4C71-8134-27C7D27CE0C2
Certificate Of Completion
Envelope Id: C5E9722D84944C71813427C7D27CE0C2 Status: Completed
Subject: Please DocuSign this document: Contract 6007
Source Envelope:
Document Pages: 34 Signatures: 7 Envelope Originator:
Certificate Pages: 6 Initials: 0 Karen E. Smith
AutoNav: Enabled
EnvelopeId Stamping: Enabled
Time Zone: (UTC-06:00) Central Time (US & Canada)
karen.smith@cityofdenton.com
IP Address: 129.120.6.150
Record Tracking
Status: Original
12/23/2015 10:13:27 AM
Holder: Karen E. Smith
karen.smith@cityofdenton.com
Location: DocuSign
Signer Events Signature Timestamp
Karen E. Smith
karen.smith@cityofdenton.com
Assistant Purchasing Manager
City of Denton
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Completed
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Sent: 12/23/2015 10:23:49 AM
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Elton Brock
elton.brock@cityofdenton.com
Purchasing Manager
City of Denton
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Chris Ekrut
cekrut@newgenstrategies.net
Director
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ID: 64a05c4f-3aab-4c24-aa06-d711ae31af93
John Knight
john.knight@cityofdenton.com
Deputy City Attorney
City of Denton
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George C. Campbell
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City Manager
City of Denton
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City Secretary
City of Denton
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Julia Klinck
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Contracts Administration Supervisor
City of Denton
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Certified Delivered Security Checked 12/28/2015 2:58:27 PM
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Electronic Record and Signature Disclosure created on: 4/20/2015 2:25:38 PM
Parties agreed to: Chris Ekrut
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