6469 EXECUTED Amendment 2
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PSA 6469 – Amendment No. 2 Page 1 of 2
THE STATE OF TEXAS §
§
COUNTY OF DENTON §
SECOND AMENDMENT TO CONTRACT
BY AND BETWEEN THE CITY OF DENTON, TEXAS
AND DELOITTE & TOUCHE, LLP
CONTRACT NO. 6469
THIS SECOND AMENDMENT TO CONTRACT NO. 6469 (“Amendment”) by
and between the City of Denton, Texas (“City”) and Deloitte & Touche, LLP
(“Consultant”);
The original Agreement provided by Deloitte & Touche, LLP for professional
services related to Agreement for Denton Municipal Electric (“DME”) and Energy
Management Operations (“EMO”) Analysis, as is contained in Contract # 6469. The initial
agreement for the Basic Services was approved on May 25, 2017, in the not-to-exceed
amount of $26,000. The first amendment for additional assessment services was approved
on July 26, 2017, in the not-to-exceed amount of $60,000.
The CITY deems it necessary to further expand the professional services provided
by CONSULTANT to the CITY;
NOW THEREFORE,
1. “ARTICLE II, SCOPE OF SERVICES” of the Agreement is hereby amended
to read as follows:
C. “CONSULTANT shall perform all those services set forth in the individual
task orders as described in Exhibit “1” – Statement of Work, Drafted:
September 11, 2017, which shall be attached to this Agreement and made a
part hereof.
2. “ARTICLE V, COMPENSATION, B. BILLING AND PAYMENT” of the
Agreement is hereby amended to read as follows:
“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 shown in Exhibit “A” – Engagement
Fees and Exhibit “1” – Statement of Work, Drafted: September 11, 2017,
which are attached hereto and made a part of this Agreement as if written word
for word herein, a total fee not to exceed $231,000.”
DocuSign Envelope ID: F3E32C78-946E-43E9-BC3F-DEB718F2BCF0
PSA 6469 –Amendment No. 2 Page 2 of 2
All other provisions of the contract, as heretofore amended, remain in full force and effect.
IN WITNESS WHEREOF, the CITY and the CONSULTANT, have each executed
this Amendment, by and through their respective duly authorized representatives and
officers on this date _________________________.
“CITY”
CITY OF DENTON, TEXAS
A Texas Municipal Corporation
By: __________________________________
TODD HILEMAN
CITY MANAGER
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
By: __________________________________
APPROVED AS TO LEGAL FORM:
AARON LEAL, INTERIM CITY ATTORNEY
By: ___________________________________
“CONSULTANT”
Deloitte & Touche, LLP
A Limited Liability Partnership
By: _________________________________
AUTHORIZED SIGNATURE, TITLE
DocuSign Envelope ID: F3E32C78-946E-43E9-BC3F-DEB718F2BCF0
Exhibit 1
STATEMENT OF WORK, DRAFTED: September 11, 2017
This Statement of Work is to confirm the engagement of Deloitte & Touche LLP (“Consultant”
or “we” or “our”) to provide City of Denton (the “Owner” or “you”) with analysis and
recommendations in support of establishing Denton Municipal Electric’s (“DME”) the FY 2017
Energy Management Organization (“EMO”) cost savings benchmark (the “Services”). The
engagement is subject to the terms of the Professional Services Agreement for DME’s EMO
(designated by Client as File 6469) to which this Exhibit A is attached and made a part thereof.
SCOPE, APPROACH, AND ASSUMPTIONS
The nature of the Services that the Consultant is to perform for the Owner can be broken into the
following tasks:
x Task 1: FY 2017 benchmark cost analysis
x Task 2: EMO capability maturity assessment
The scope of work will focus on helping the Owner and DME establish a benchmark for FY
2017 that is representative of the capabilities of the EMO. The approach to providing these
services includes:
Task 1
Key Activities:
x Assess the appropriateness of different methodologies for calculating the FY2017
cost savings, including the following:
o A benchmark method initially identified by DME for FY 2017: 3.5 heat rate adder
over the DAM ERCOT index for energy
o A benchmark method based on the following approach – Compare actual
performance to the market forwards as of a particular date for the energy
component
x Identify the advantages and disadvantages between benchmark different options
x Recommend an option going forward for the City and DME’s consideration
Deliverables
x Executive summary of analysis, results and recommendation
x The advantages and disadvantages of the different benchmark options
x A recommendation on the appropriate benchmark to use in the cost savings
calculation
Duration and Fees:
x Approximately 3 weeks and 150 hours
x $35,000, inclusive of travel
DocuSign Envelope ID: F3E32C78-946E-43E9-BC3F-DEB718F2BCF0
Task 2:
Key Activities
x Gain an understanding of DME’s current energy risk management governance
structure, control activities, resources and technology, including the possible risks
assumed by DME with the creation of the EMO
x Interview specific Owner and DME personnel involved in the execution of the EMO
program in order to develop an in-depth understanding of EMO’s existing activities.
x Identify potential gaps and develop recommendations utilizing our proprietary
Capability Maturity Model
x Review our findings and recommendations with appropriate Owner and DME
personnel
x Advise DME management in their preparation for specific stakeholder discussions
(e.g. Board of Directors, senior management, City Council) to gain agreement and
consensus on their desired future state program
Deliverables:
x Risk Assessment Executive Summary
x Detailed Assessment Findings
x Advice and recommendation on the potential enhancement for EMO’s consideration
to help achieve the desired future state and/or close identified gaps
Duration and Fees:
x Approximately 5 weeks and 400 Hours
x $110,000 inclusive of travel
ACKNOWLEDGMENTS AND AGREEMENTS
x Substantial and meaningful involvement of key stakeholders in the risk assessment and
risk identification process of the Company is critical to the success of this engagement.
The Company shall be responsible for ensuring that the identified Company personnel
actively participate in both the planning and execution of this engagement.
x The Services will not constitute an engagement to provide audit, compilation, review, or
attestation services as described in the pronouncements on professional standards issued
by the AICPA, the Public Company Accounting Oversight Board, or other regulatory
body and, therefore, we will not express an opinion or any other form of assurance as a
result of performing the Services.
x Consultant will not make any management decisions, perform any management
functions, or assume any management responsibilities.
x Observable inputs such as market data shall be provided by the Owner or agreed with
Owner for use in the assessment
The Services will be performed in accordance with the Statement on Standards for Consulting
Services issued by the American Institute of Certified Public Accountants (AICPA).
DocuSign Envelope ID: F3E32C78-946E-43E9-BC3F-DEB718F2BCF0
TIMETABLE
Based on our experience delivering similar engagements, we believe that the services described
can be provided in approximately six (6) weeks.
ENGAGEMENT FEES
The estimated fees for this engagement are estimated not to exceed $145,000 inclusive of travel,
based on the following rates and approximately 550 hours:
Resource Level Hourly Rate
Partner, Principal, Managing
Director $445
Senior Manager $415
Manager $380
Senior Consultant $330
Consultant $280
US India Senior Consultant $91
DocuSign Envelope ID: F3E32C78-946E-43E9-BC3F-DEB718F2BCF0
Certificate Of Completion
Envelope Id: F3E32C78946E43E9BC3FDEB718F2BCF0 Status: Completed
Subject: City Council Docusign Item - 6469 Amendment No. 2
Source Envelope:
Document Pages: 6 Signatures: 4 Envelope Originator:
Certificate Pages: 6 Initials: 0 Cindy Alonzo
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Cynthia.Alonzo@cityofdenton.com
IP Address: 10.102.101.11
Record Tracking
Status: Original
10/5/2017 7:54:05 AM
Holder: Cindy Alonzo
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Buyer
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