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HomeMy WebLinkAbout1999-012S \Our Documents\Ordinances\98\Amendment#3 RJ Covington Consulting doc ORDINANCE NO AN ORDINANCE OF THE CITY OF DENTON, TEXAS AUTHORIZING THE CITY MANAGER TO EXECUTE AMENDMENT NUMBER THREE TO THE PROFESSIONAL SERVICES AGREEMENT FOR CONSULTING SERVICES WITH R J COVINGTON CONSULTING RELATING TO THE DENTON MUNICIPAL ELECTRIC UTILITY, DATED FEBRUARY 16, 1998, PROVIDING FOR ADDITIONAL PROFESSIONAL SERVICES TO BE PERFORMED RELATED TO ELECTRIC RESTRUCTURING AND REGULATORY MATTERS, BY ADDING TASK ORDER NO 98-E, AUTHORIZING THE EXPENDITURE OF ADDITIONAL FUNDS THEREFOR, AND PROVIDING AN EFFECTIVE DATE WHEREAS, on the 16th 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"), on the 28`h day of April, 1998, the City and Covington entered into a First Amendment to said Agreement, on the 4`h day of August, 1998, the City and Covington entered into a Second Amendment to said Agreement, in all three of which Agreements, Covington agreed to perform professional consulting services pertaining to electric utility restructuring and state regulatory matters impacting upon Denton Municipal Electric, and WHEREAS, several events have occurred since the Second Amendment to the Agreement was entered into, which impact upon the position of the City's Municipal Electric Utility asi it approaches the upcoming Texas Legislative Session, and several pending projects before the Public Utilities Commission of Texas, which urgently require that Denton obtain additional demonstrated competent and qualified professional and consulting services in order to properly prepare, communicate, and protect its position and advance its interests, and WHEREAS, Task Order No 98-E shall be added by the Third Amended Agreement, to include six areas where the City needs professional consulting services incident to proper evaluation, planning, and related services incident to competitive issues, the operation of, and possible divestiture of the Denton Municipal Electric system, which amendment provides that the City shall pay additional compensation to Covington attributable to Task Order No 98-E, not to exceed $ 47,000 for professional fees and expenses, and WHEREAS, the City Council deems it in the public interest to engage Covington to provide the additional professional consulting services to the City and to accordingly enter into a Third Amended Agreement providing for said services, NOW THEREFOR, THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS SECTION I, That the City Manager is hereby authorized to execute the Third Amendment To Professional Services Agreement For Consulting Services Relating To The Denton Munttrapal Electric Utility (the "Third Amended Agreement") with R J Covington Consulting for the provision of additional professional consulting services respecting the above- S \Our Documents\Ordmences\98WmendmentN3 RJ Covington Consulting doe described activities pertaining to Denton Municipal Electric, in substantially the form of the Third Amended Agreement attached hereto and incorporated herewith by reference SECTION II That the award of this Third Amended Agreement is on the basis of the demonstrated competence and qualifications of R J Covington Consulting and the ability of R J Covington Consulting to perform the services needed by the City for a fair and reasonable price SSECTION III That the expenditure of funds as provided in the attached Third Amended Agreement is hereby authorized SECTION IV That this ordinance shall become effective immediately upon its passage and approval PASSED AND APPROVED this the '�-4 day of 1999 JACK LER, MAYOR ATTEST JENNIFER WALTERS, CITY SECRETARY BY APPROVED AS TO LEGAL FORM HERBEE�RT L PROUTY, CITY ATTORNEY /$0 � ;U STATE OF TEXAS COUNTY OF DENTON THIRD AMENDMENT TO PROFESSIONAL SERVICES AGREEMENT FOR CONSULTING SERVICES RELATING TO DENTON MUNICIPAL ELECTRIC THIS THIRD AMENDMENT, to the Professional Services Agreement For Consulting Services Relating To The Denton Municipal Electric Utility, entered into on the 16a' 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 28d' day of April, 1998, by and between Covington and the City, which Agreement is hereinafter referred to as the "First Amended Agreement', said Base Agreement was also heretofore amended by Second Amendment, entered into on the fourth day of August, 1998, by and between Covington and the City, which Agreement is hereinafter referred to as the "Second 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, the First Amended Agreement, and the Second Amended Agreement as follows That Article II "Scope of Services" of the Base Agreement, the First Amended Agreement, and the Second Amended Agreement is hereby amended by adding the following additional provision II E Covington shall provide to the City those services set forth in the First Amended Task Order No 98-D (Tasks, A,B,C,D,E,F, and G ) U F Covington shall provide to the City those services set forth in an additional Task Order, Task Order 98-E (Tasks A,B,C,D,E and F) 11 That Article III 'Period of Service" of the Base Agreement, the First Amended Agreement and the Second Amended Agreement is hereby amended by adding the following additional provision As to the period of service respecting the completion of all Task Orders 98-A,B,C,D,and E, the term of this Agreement shall expire when all services provided for in said Task Orders are completed, or upon the depletion of the budget provided for under said Agreements Tbird Amendment To Professional Services Page I That Article IV B 1, "Compensation/Billing and Payment" of the Base Agreement, the First Amended Agreement, and the Second Amended Agreement is hereby amended by adding the following additional provision With respect to the additional professional services to be performed by Covington pursuant to Task Order 98-E, the City agrees to pay Covington, a further professional fee, including reimbursement for direct non -labor expense, not to exceed $47,000 IV That Article XIV "Entire Agreement" of the Base Agreement, the First Amended Agreement, and the Second 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-B, Task Order No 98-C, Task Order No 98-D, First Amended Task Order 98-D, and Task Order 98-E, which Exhibit "A" and Task Orders are incorporated by reference herewith, copstitutes 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 Third Amended Agreement to be executed in four original counterparts, by its duly -authorized City Manager, and Co ggton has executed this Agreement by its duly -authorized Owner and proprietor on this the �Ct22r day of, 1999 "CITY" DENTON, IM ATTEST B N AL RS, ITY SECRETARY APN(OVED Ag TO LEGAL FORM HERBERT L PRO , CITY ATTORNEY BY J \ Thjrd Amendment To Professional services - Page 2 "Covington" R J COVIINGTOON CONSULTING BY i BY ft4i,% �/ Richard J Cov on, Prestd ATTEST m Third 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-E CONSULTING SERVICES This Task Order amends Article IV, B,1 of the Professional Services Agreement and sets forth specific services to be provided by R J Covington Consulting (RJC) to the City of Denton (City) Tasks provided for in this Amendment may include the following activities 1) Research of Competitive Issues Facing City 2) Assistance With Analysis Of Customer Specific Questions 3) Assistance in Evaluation of Strategic Options 4) Assistance in Evaluation of and Development of Contracts and Agreements 5) Support of Distribution, Transmission and Generation Planning 6) Other Services as Directed by City All specific activities performed by RJC under this Task Order will be at the direction of the Director of Electric Utilities Scope of Services Task to Research of Competitive Issues Facing Citv RJC will gather and review data on competitors and on competitive issues that affect City This will included data from the PUC, ERCOT, and other industry sources Information may be obtained as part of RJC's on -going activities in the market place, or research of particular issues as requested by staff Activities can include Maintaining copy of competitors tariffs Monitoring of competitor filings at PUC Monitoring of power costs in North Texas Monitoring of new generating plants proposed in North Texas Review and monitoring of transmission constraints affecting North Texas Researching competitive issues as directed Task B Assistance With Analysis Of Customer Specific Ouestions RJC will work with City to evaluate questions which anse in serving Cit/s customers Such questions may include Task Order No 98-E 1 Interconnect questions for on -site generation 2 Buy-back rates from customer owned generation 3 Development of interruptible options for customers 4 Development of switch -over policy 5 Evaluation of conjunctive billmg 6 Other issues as requested by staff Task C Assistance in Evaluation of Strategic Options RJC will work with City staff in evaluating and developing options for services to lower costs, enhance revenues and help protect against lost of customers to competition Such activities may include 1 Evaluate new services to be offered to distribution customers to provide new sources of revenues for City 2 Identify partnering opportunities to increase revenues 3 Evaluate load management options Task D Assistance in Evaluation of and Development of Contracts and Agreements RJC will provide assistance as requested for the development of and evaluation of agreements and contracts between the City and 1 DMEU customers 2 Other utilities 3 Control areas 4 Other Agreements as necessary to doing business in ERCOT Task F Support in Distribution, Transmission and Generation Planning RJC will provide assistance to staff as needed to model, evaluate and plan for the electric system Such activities may include 1 Evaluation of transmission costs from alternative resources 2 Review of forecast for system and substations 3 Evaluate transmission and distribution facilities for upgrades and replacements 4 Provide assistance in filing annual planned service application with ERCOT 2 Task Order No 98-E Task IF Other Services as Directed by Citv RJC will provide continued consulting services as specified in Article II - Scope of Services, in the Professional Services Agreement As stated in Article II, such services are as follows "A Covington shall provide to the CITY professional services and technical support, upon City's request, which shall relate to PUC and Texas legislative activities relatmg thereto, including without limitation, power marketing issues, stranded cost issues, participation and review of the Excess Cost Over Market ("ECOM") model, pricing issues, TMPA issues, and divestiture issues " "B To consult with the City Manager, Assistant City Manager/Utilities, the Director of Electnc Utilities, the City Attorney, and other designated admirustrative personnel regarding any and all aspects of the services to be performed pursuant to this Agreement " Budget The budget for the above scope of services for time and expenses is estimated at $47,000 This budget will not be exceeded without prior approval of the City RJC will bill monthly with supporting documentation of activities performed EXECUTED this f day of 00 199q CITY CONSULTANT CITY OF DENTON, TEXAS R J COVINGTON CONSULTING By By vNtichael Jez - ty wager Richard J Co gton