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HomeMy WebLinkAbout1998-229F \sharad\dept1L OUOur Documents\Ordlnances\98Wnended Ri Ordinance doc ORDINANCE NO Da) AN ORDINANCE OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE A SECOND AMENDMENT TO THE PROFESSIONAL SERVICES AGREEMENT FOR CONSULTING SERVICES RELATING TO DENTON MUNICIPAL ELECTRIC WITH R J COVINGTON CONSULTING FOR PROFESSIONAL SERVICES PERTAINING TO ELECTRIC RESTRUCTURING AND ASSISTANCE AND SUPPORT OF CITY STAFF RESPECTING PUBLIC UTILITY COMMISSION OF TEXAS PROJECT NO 18703, AUTHORIZING THE EXPENDITURE OF FUNDS THEREFOR, AND PROVIDING AN EFFECTIVE DATE WHEREAS, on the le day of February, 1998 the City entered into a "Professional Services Agreement For Consulting Services Relating To The Denton Municipal Electric Utility" ("Agreement") with R J Covington Consulting ("Covington"), and on the 281h day of April, 1998, the City and Covington entered into a First Amendment to said Agreement, in both of which Agreements Covington agreed to perform professional and consulting services pertaining to electric utility restructuring, and WHEREAS, several events have occurred before the Public Utilities Commission of Texas, namely in Project No 18703, and other related Projects since the City entered into the above Agreement and the First Amendment to Agreement, which impact upon the position of the City's Municipal Electric Utility as it approaches the upcoming Texas Legislative Session, and which urgently requires that Denton obtain additional professional and consulting services in order to protect its position and advance its interests, and WHEREAS, it appears to the Council that it is in the best interest of the City to obtain such additional professional and consulting services by entering into a Second Amended Agreement with Covington NOW THEREFOR, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SACTION I That the City Manager is hereby authorized to execute the Second Amendment To Professional Services Agreement For Consulting Services Relating To The Denton Municipal Electric Utility (the "Second Amended Agreement") with R J Covington Consulting for the provision of additional professional and consulting services related to electric restructuring and deregulation, and related to PUC Project No 18703, a copy of which Second Amended Agreement is attached hereto and incorporated herewith by reference, along with any Task Orders and other documents necessary in the performance of the Second Amended Agreement SECTION II. That the expenditure of funds as provided in the attached Second Amended Agreement is hereby authorized 5ECTION III That this ordinance shall become effective immediately upon its passage and approval PASSED AND APPROVED this the day of / //L��IL� 1998 ATTEST JENNIFER WALTERS, CITY SECRETARY BY AP OVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY ., fMJ.vY � .lam STATE OF TEXAS COUNTY; OF DENTON SECOND AMENDMENT TO PROFESSIONAL SERVICES AGREEMENT FOR CONSULTING SERVICES RELATING TO DENTON MUNICIPAL ELECTRIC THIS SECOND AMENDMENT, to the Professional Services Agreement For Consulting Services Relating To The Denton Municipal Electric Utility, entered into on the 16`h day of February, 1998, by and between R J Covington Consulting, a sole proprietorship, with its principal offices at 13276 Research Boulevard, Suite 204, Austin, Texas 78750 ("Covington"), and the City of Denton, Texas, a Texas Municipal Corporation, with its principal offices at 215 E McKinney, Denton, Texas 76201 ("City") for professional and related consulting services provided to the City, which Agreement is hereinafter referred to as the "Base Agreement", said Base Agreement was heretofore amended by First Amendment, entered into on the 28th day of April, 1998, by and between Covington and the City, which Agreement is hereinafter referred to as the "First Amended Agreement" In consideration of the mutual promises of the parties, the terms and conditions set forth herein, and for other good and valuable considerations expressed herein, the parties hereby AGREE to amend the said Base Agreement and First Amended Agreement as follows I That Article II "Scope of Services" of the Base Agreement and the First Amended Agreement is hereby amended by adding the following additional provision IhE Covington shall provide to the City those services set forth in Task Order No 98- D (Tasks A,B,C,D,E, and F) II That Article III "Pertod of Service" of the Base Agreement and the First Amended Agreement is hereby amended by adding the following additional provision As to the period of service respecting the completion of Task Order 98-D, the term of this Agreement shall be from July 1, 1998 to June 30, 1999 III That Article IV B 1 "Compensation/Billing and Payment" of the Base Agreement and the First Amended Agreement is hereby amended by adding the following additional provision Second Amendment To Professional Services — Page 1 With respect to the additional professional services to be performed by Covington pursuant to Task Order 98-D, the City agrees to pay Covington, a further professional fee, including reimbursement for direct non -labor expense, not to exceed $ 100,000 00 IV That Article XIV "Entire Agreement' of the Base Agreement and the First Amended Agreement is hereby amended to replace the entire paragraph contained in Article XIV With the following language, to wit This Agreement, consisting of nine (9) pages, plus Exhibit "A" (Fees For Services), Task Order No, 98-13, Task Order No 98-C, and Task Order No 98-D, which Exhibit "A" and Task Orders are incorporated by reference herewith, constitutes the complete and final expression of the Agreement of the parties and is intended as a complete and exclusive statement of the terms of their Agreement and supersedes all prior contemporaneous offers, promises, representations, negotiations, discussions, communications and agreements which may have been made in connection with the subject matter hereof V IN WITNESS WHEREOF, the City of Denton, Texas has caused this Second Amended Agreement to be executed in duplicate original counterparts, by its duly -authorized City Manager, and Covmgta has execu d this Agreement by its duly -authorized Owner and Proprietor on this the day of t , 1998 "CITY" CITY OF DENTON, TEXAS BY Ted Benavides, City Manager ATTEST JENNIFER WALTERS, CITY SECRETARY BY APPRQVED AS TO LEGAL FORM HERBERT L PROUTY, CITY ATTORNEY BY'I Second Amendment To Professional Services — Page 2 "COVINGTON" R J COVINGTON CONSULTING BY &dwe_tz 9 Richard J Covm i Owner & Proprietor ATTEST M F \shared\dept\LGL\Our Documents\Contracts\98\SecondAmended Covington doe Second Amendment To Professional Services — Page 3 AMENDMENTTO PROFESSIONAL SERVICES AGREEMENT DATED FEBRUARY 16,1998 BETWEEN THE CITY OF DENTON AND R J COVINGTON CONSULTING TASK ORDER NO 98-D This Task Order sets forth specific services to be provided by R J Covington Consulting (RJC) and amends Article IV, B,1 of the Professional Services Agreement Tasks provided for in this Amendment are directed at assisting the City staff (Staff) in participation at the Public Utility Commission of Texas (PUC) on issues affecting the City The PUC has identified Project 17555 - Investigation Into the Competitiveness of the Wholesale Market and Docket 18703 - Review of Transmission Access Rules, PUC Subst Rule 23 67 and 23 70 to address a number of issues related to restructuring of the electric industry in Texas PUC staff has recommended the following categories of actions in order to accelerate the pace at wluch the wholesale market is developing This includes, 1) PUC Rulemakmg, 2) Other PUC Activities, and 3) ISO Activities The PUC has projected a schedule for these activities to cover from July 1998 through December 1998 These proceedings will overlap other Dockets Because Docket 18703 is the transmission open access rule, it essentially opens the entire rules 23 67 and 23 70 for discussion For example the Commission has also cited an interest in re -working the transmission pricing structure (VAMM and Postage Stamp), including the transition mechanism issue The frequency of TCOS updates, whether to update billing units and other TCOS issues are also up for review The rules for governing must -run units (Project 14789) is being reviewed and will likely be addressed further in the discussion on ancillary services in Docket 18703 RJC'$ work will therefore focus on these proceedings, and related proceedings as they evolve, to address restructuring issues RJC's role will be that of Staff liaison to PUC to keep Staff informed on activities, work with Staff in developing positions on issues, assist Staff in responding to issues that affect City and provide technical support for Staff and City's legal experts on regulatory issues RJC's activities will include, 1 ) attending workshops hosted by PUC and ISO, 2 ) participating on relevant PUC and ISO committees to discuss and debate issues, 3) analyzing proposed rules filed by PUC and policies presented by ISO, 4 ) preparation of comments to be filed at the PUC to present the City's position on issues, 5 ) analyzing comments filed by other parties on issues affecting City, t of 4 6) working with City Staff and legal team to develop responses to positions taken by other parties adverse to the City's positions, 7) providing technical support to Staff and the City's legal team on issues before the PUC and the ISO, 8) maintaining information on activities at the PUC, ERCOT ISO and the Legislature that supports effective representation on issues in these and related proceedings associated with restructuring in Texas Scope of Services Task A Attending Workshops At PUC And ISO RJC will stay informed on activities at PUC and ISO and will attend workshops as needed When appropriate, RJC will participate in workshops to represent interest of City based on directions of Staff Reports will be provided to Staff detailing issues addressed and positions taken by parties at workshops Task B Particigahon On Cominittees I RJC will participate on working committees as approved by Staff in order to influence issues and solutions brought forward for discussion to larger groups 2 Staff will be kept informed of issues being addressed in committees and positions of parties 3 RJC will discuss with Staff positions which should be taken and strategies for working with parties involved Task C Analyze Proposed Rules and Policies The proposed new rules and rule changes from the PUC and associated proposed policies from the ISO will be analyzed RJC will discuss proposed new rules and changes to existing rules with Staff, helping to identify areas of concern and preparing positions on rules that represent interests of City RJC will meet with PUC staff as appropriate to discuss the proposed rules and present the City's concerns regarding PUC staff proposals 2of4 Task D Preparation of Comments RJC will prepare or assist in preparing comments to be filed with PUC representing City's position on issues brought up in proposed rules These comments will be coordinated through Staff and the City's legal team RJC will assist the City's legal team as necessary in the preparation of and filing of comments Task E Work With Staff And Legal Team 1 RJC will have continuing communication with Staff and the City's legal team in order to monitor proposed industry changes and address those issues affecting municipalities 2 An on -going dialog will be maintained with Staff and the legal team in order to evaluate changing proposals and evaluate potential effects on City operations 3 Information necessary to supplement and support the decision making process will be provided as requested 4 RJC will be available to discuss with the Utility Board and City management activities at PUC and the ISO as requested from time to time by Staff 5 As directed by Staff, RJC will coordinate and support other consultants, attorneys, and lobbyists used by the City in order to insure coordination of planning and other activities Task F Technical Support 1 RJC will provide technical support to the City's legal team to assist in the evaluation of proposals and the potential impact on the City under different scenarios 2 RJC will provide technical support to Staff, providing information as requested from time to time to assist Staff in its evaluations and planning processes 3 RJC will evaluate scenarios and proposals from perspective of City utility and as a member of TMPA 4 Workpapers will be developed to support the analysis and will be provided to City upon request 5 Presentations to Staff will be made as appropriate to discuss results of analyses and recommended strategies based on the results 3 of 4 Budget The budget for the above scope of services for labor and expenses is difficult to estimate due to the fact that the actual rulemaking proceedings are lust beginning However, because of the wide range of issues to be addressed, the significant impact these issues will have on utilities in Texas, and the limited time allowed for parties to address these issues, it is expected that an intense effort will be required for the next six months Based on prior experience in working with these issues, RJC recommends a budget of $100,000 for labor and expenses be approved This budget will not be exceeded without prior approval of the City RJC will bill monthly with supporting documentation of activities performed The work being performed will be under the supervision of the Director of Electric Utilities and may be modified at any time upon appropriate notice to RJC EXECUTED thA4 day of 1998 AUTHORIZED BY CITY OF DENTON, TEXAS By ATTEST JENNIFER WALTERS CITY SECRETARY ACCEPTED BY R J COVINGTON CONSULTING APPROVED AS TO LEGAL FORM HERBERT L PROUTY CITY ATTORNEY B By 9ated Dated '7I2-)-) CIF 4of4