1993-114e:\WPD0CS\0RD\A14ERICAN.0
ORDINANCE NO. _93 - AN ORDINANCE AUTHORIZING THE CITY MANAGER TO EXECUTE AN AGREEMENT
BETWEEN THE CITY OF DENTON AND AMERICAN APPRAISAL ASSOCIATES, INC.
FOR PROFESSIONAL SERVICES TO CONDUCT AN INVENTORY OF CITY ASSETS;
PROVIDING FOR THE EXPENDITURE OF FUNDS THEREFOR; AND PROVIDING FOR
AN EFFECTIVE DATE.
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION I. That the City Manager is authorized to execute an
Agreement between the City of Denton and American Appraisal Assoc-
iates, Inc. for professional services to conduct an inventory of
City assets.
SECTION II. That the City Manager is authorized to expend
funds for the above referenced professional services to the firm
of American Appraisal Associates, Inc. in the amount of Seventy Six
Thousand Nine Hundred Seventy Five Dollars ($76,975.00).
SECTION III. That this ordinance shall become effective immed-
iately upon its passage and approval.
, 1993.
PASSED AND APPROVED this the day of
44*--9 _t
BOB CASTLEBERRY, MAY
ATTORNEY
ATTEST:
JENNIFER WALTERS, CITY SECRETARY
AGREEMENT BETWEEN THE
CITY OF DENTON AND
AMERICAN APPRAISAL ASSOCIATES, INC.
The City of Denton, Texas situated in DE
hereinafter called "City", acting herein by
Manager, and American Appraisal Associates,
organized under the laws of Delaware,
"Consultant", acting herein by and through
hereby mutually agree as follows:
Anton County, Texas,
and through its City
Inc., a corporation
hereinafter called
its vice President,
I. SERVICES TO BE PERFORMED: City hereby retains Consultant to
perform the hereinafter designated services and Consultant
agrees to perform the following services:
A. Conduct an appraisal and inventory of City's
assets, in accordance with the scope of
services set forth in Exhibit "A", a copy of
which is attached hereto.
Consultant agrees to provide warranties on all
computer hardware and software for a period of
one year from the date of acceptance by the
City.
B. Availability of City Resources: City will make
available to Consultant the following:
Information and explanations requested through
the Director of Accounting and Budget
Operations, and the City's Internal Audit
staff and staff from the various operating
departments will be available on a limited
basis to assist the Consultant during the
physical inventory process.
II. SCHEDULE OF SERVICES:
A. Completion of Field Inventory
July 15, 1993
Completion of Office Pricing
August 14, 1993
Completion of office processing and review
September 15, 1993
Delivery of Report
September 30, 1993
1
2
III.
B. Deviation from this schedule is acceptable
only if approved by City's Executive Director
of Finance, or for reasons beyond the
Consultant's control.
COMPENSATION TO BE PAID CONSULTANT: City agrees to
pay Consultant for the services performed hereunder
as follows:
A. Amount of payment for services: The sum of
Seventy-Six Thousand Nine Hundred Seventy-Five
Dollars ($76,975.00) as follows:
Fixed assets appraisal including $56,000
tagging
SATO model 8450 Label printer, 5,700
including tag stock
ASTDX2-50 PC, Sony VGA monitor, 4,000
and Panasonic 2624 printer
Bar code readers (2) 6,200
PC based fixed asset system:
- Fixed asset system only 1,500
- IDOL IV Ad-hoc report program 800
- 3 days on-site training 21275
First Annual Trend Factors 500
In addition, Consultant agrees to provide a
copy of the master file on computer tape at no
charge.
B. Dates of payment: City will make payment
within 30 days of proper completion of
services provided for herein and of receipt of
invoice, as follows:
Fifty percent (50%), or Thirty-Eight Thousand
Four Hundred Eighty-Seven Dollars ($38,487.00)
upon completion of the inventory sweep.
Thirty-three percent (33%), or Twenty-Five Thousand
Four Hundred Two Dollars ($25,402.00) upon delivery
of the reports
Seventeen percent (17%), or Thirteen Thousand
Eighty-Six Dollars ($13,086.00) after delivery
of the final report.
3
IV. INDEPENDENT CONTRACTOR: It is mutually understood
and agreed by and between City and Consultant that
Consultant is an independent Consultant and shall
not be deemed to be or considered an employee of the
City of Denton, Texas, for the purposes of income
tax, withholding, social security taxes, vacation or
sick leave benefits, worker's compensation, or any
other City employee benefit. Consultant shall
perform the services hereunder at the direction of
and to the satisfaction of the City Manager of the
City of Denton or his designee under this Agreement.
V. INSURANCE: Consultant shall provide at its own cost
and expense Workers' Compensation insurance
liability insurance, and all other insurance
necessary to protect Consultant in the operation of
Consultant's business.
VI. INDEMNIFICATION: Consultant shall and does hereby
agree to indemnify and hold harmless the City of
Denton from any and all damages, loss or liability
of any kind whatsoever, by reason of injury to
property or third persons arising from any negligent
act or omission of Consultant, its officers, agents,
employees, invitees, and other persons for whom it
is legally liable, in the course of the performance
of this Agreement, and Consultant will, at its cost
and expense, defend and protect the City of Denton
against any and all such claims and demands.
VII. CANCELLATION: City and Consultant each reserve the
right to cancel this Agreement at any time by giving
the other party fourteen (14) days written notice of
its intention to cancel this Agreement, provided the
City pays Consultant for services performed prior to
notice of cancellation.
VIII. TERM OF CONTRACT: This Agreement shall commence on
the 16th day of June, 1993, and end upon the
completion of the project.
IX. NOTICES: Any notice given by one party to the other
in connection with this Agreement shall be in
writing and shall be sent by registered mail, return
receipt requested, with postage and registration
fees prepaid, as follows:
If to City, addressed to:
City Manager
City of Denton
215 E. McKinney
Denton, Texas 76201
ph-,
4
If to Consultant, addressed to:
John W. Hughes
American Appraisal Associates, Inc.
14651 Dallas Parkway, Suite 405
Dallas, Texas 75240
Notices shall be deemed to have been received on the
date of receipgt~ as shown the return receipt.
EXECUTED this day of 1993.
CITY OF DENTON, TEXAS
By:
1 d V. Harrell
City Manager
ATTEST:
Jennifer Walters, City Secretary
By: 341w ' l~t/L~-eo~-$a
APPROVED AS TO LEGAL FORM:
Debra A. Drayovitch, City Attorney
By: 42~'e 'c , X
AMERICAN APPRAISAL ASSOCIATES, INC.
By: _.J,~ Ltl .
Ronald M. Goergen
Executive Vice President
American Appraisal Associates
PROPOSAL TO CITY OF DENTON, TEXAS
FOR
A FIXED ASSETS INVENTORY
American Appraisal Associates, Inc.
14651 Dallas Parkway, Suite 405
Dallas, Texas 75240
Mr. John W. "Jack" Hughes
District Manager
(214) 392-0630
May 3, 1993
American Appraisal Associates
TABLE OF CONTENTS
SECTION
1
Page
I.
Introduction
4
II.
Engagement objectives
5
III.
Field Procedures and Specific Elements
to be Collected
7
IV.
Inventory Valuation
11
V.
Reports Furnished
it
VI.
Project Staffing
12
VII.
Bar Code Readers
13
VIII.
Fixed Asset Software System
15
IX.
Timing and Delivery
16
X.
Fees and Payments
16
XI.
General Services Conditions
19
SECTION
2
Representative List of Public Sector
Clients Served
20
SECTION
3
Representative Client Listing For
Texas Municipalities and Universities......
21
SECTION 4
SECTION 5
SECTION 6
SECTION 7
SECTION 8
Public Sector Group Capabilities
Biographical Sketches of Project Team
Sample Report
TELXON Literature, Municipal Administrative
Solutions, and American Appraisal Associates,
Inc. Brochures
City of Denton, Notice To Vendors
RFSP #1494
AA
American Appraisal Associates
The Princeton
14651 Dallas Parkway
Suite 405
Dallas, Texas 75240-7479
Telephone 214/392-0630
Fax 214/239-4649
May 3, 1993
Ms. Kathy DuBose, CPA
Controller
City of Denton
Municipal Building
Denton, Texas 76201
RE: Fixed Asset Inventory of
the City of Denton, Texas
Dear Ms. DuBose:
American Appraisal Associates is pleased to respond to your request
for a proposal relative to a fixed asset equipment and building
appraisal for the City of Denton owned property. Our proposed
involvement centers upon a need to develop a property inventory, to
provide original and replacement cost data, and to assist in making
this information available to management within an appropriate time
frame. our experience indicates that property moves frequently,
although often referred to as fixed assets. Therefore, the initial
inventory must be completed rapidly or accuracy can be hindered.
Further, a system for perpetuation must be in place at the
conclusion of the field inventory process to preclude rapid
obsolescence of the system.
THE CONSULTING TEAM
We have made every effort to be responsive to your objectives and,
where possible, have provided more information than required to
help you better understand our approach and our service philosophy.
Based upon the benefits to be achieved, you should have the
following expectations from the firm engaged to help you in meeting
your objectives. As your consultant, we will provide the follow-
ing:
Me value your business."'
American Appraisal Associates
Ms. Kathy DuBose 2 May 3, 1993
(1) A project team with significant public sector fixed
asset expertise directed by a project manager
capable of utilizing national and local resources.
(2) A professional team consisting of individuals
experienced in Generally Accepted Accounting
Principles; Governmental Accounting, Auditing and
Financial Reporting; Fixed Asset Records; and
valuation expertise.
(3) A project team with the necessary resources to
complete all field inventory requirements and
establish ongoing perpetuation procedures within
120 days of authorization. Further, to completely
implement and install the entire fixed-asset
management system no later than September 15, 1993.
The project team will be headed by Mr. Paul Gruenwald, Product
Services Manager, who has over 20 years of public sector experience
and by members from a full-time Property Appraisal Services Group
that specializes in appraisals for cities, counties, school
districts, universities, and colleges. Our staff is committed to
performing work of the highest quality and providing on time
deliveries. Our support to your City does not end at the time the
appraisal reports are delivered but continues on to answer any
questions you or your auditors may have concerning our work.
LEADERS IN SERVING GOVERNMENT
American Appraisal has significant experience serving government
entities in the design and implementation of fixed-asset systems.
We have served more than 1,200 government clients ranging from
small school colleges and municipalities to large school colleges,
cities, and states.
American Appraisal Associates, Inc. is an international firm,
founded in 1896. It is the oldest and largest professional
valuation firm in the world. Currently, we have 800 full-time
employees located in 27 offices throughout the United States. In
any given year, service engagements for approximately 4,500
individual clients are performed by American Appraisal. In
addition, more than 2,500 engagements are executed on an annual
American Appraisal Associates
Ms. Kathy DuBose 3 May 3, 1993
basis through the Continuous Service Division for perpetuation of
property records and insurable value requirements.
We recognize the importance of selecting the best firm to service
the City of Denton - and the importance of people who bring a
wealth of expertise in government and fixed-asset systems designed
specifically for the project. We are confident American Appraisal
Associates, Inc. has the staff and experience to assist you in this
important project.
CONCLUSION
Thank you for this opportunity to provide our recommendations and
proposal. Please be assured that we would give this matter our
utmost professional attention.
Very truly yours,
John W. "Jack" Hughes
District Manager
JWH/jcg
Enclosures
American Appraisal Associates
Ms. Kathy DuBose 4 May 3, 1993
I. INTRODUCTION
The City of Denton requires a comprehensive fixed asset inventory
and property control system. This system must provide an accurate
inventory of all personal and real property for effective analysis
and control of its general fixed asset account group.
The need for a fixed asset inventory system is clearly established
for the City by certain pronouncements of the Governmental
Accounting, Auditing and Financial Reporting (GAAFR), Audits of
State and Local Government Units (AICPA), and National council on
Government Accounting (NCGA) Statement 1.
American
Appraisal
Associates, Inc. (AAA)
is prepared to provide
the City
with a comprehensive fixed asset
inventory and
property
control
system for
specific assets. Our
proposal is
carefully
designed
to meet
specific needs of the
City for a
property
informat
ion system.
The complexities of implementing the fixed asset inventory and
property control system being considered by the City, necessitates
a well conceived and coordinated plan based on organization,
experience and expertise. Our proposal incorporates this kind of
service plan.
Selection of an appraisal firm to provide such a comprehensive and
complex service requires careful consideration of a firm's size,
capability, utility, expertise, reputation in the property systems
field, financial responsibility and, most importantly, an under-
standing of the City's needs. American Appraisal Associates, Inc.
believes it meets the test of these considerations. Our firm
offers the City of Denton years of experience in providing
governmental, institutional, and industrial clients with counsel on
property value and property control.
The fixed asset inventory and property control project is an
extremely challenging one. The establishment and implementation
of such a complex system demands a high level of specialized
experience and knowledge to ensure proper implementation. American
Appraisal Associates, Inc. possesses in house, the unique combina-
tion of capabilities and experience particularly suited to this
American Appraisal Associates
Ms. Kathy DuBose 5 May 3, 1993
sophisticated project. We are confident of our ability, not only
to provide the high level of quality services to the City, but to
provide these services economically and expeditiously.
II. ENGAGEMENT OBJECTIVES
The objectives for this engagement are threefold:
1. Development of Property Record System - The City
will be provided with a detailed property informa-
tion system, offering the following benefits and
goals:
(a) Proper accountability and steward-
ship of owned assets.
(b) Compliance with the requirements of Gen-
erally Accepted Accounting Principles
(GAAP) and Governmental Accounting, Au-
diting and Financial Reporting (GAAFR)
for both the General Fund and Enterprise
Fund assets.
(c) Elimination of a major obstacle in the process
of obtaining the Certificate of Achievement
from the Government Finance Officers Associa-
tion (GFOA).
(d) Assurance that the City will not be pe-
nalized, via high interest rates, by the
bond rating companies for lack of ade-
quate property records.
(e) A basis for projecting the cost of future
capital replacement.
(f) Improvement in equipment utilization
through control identification of
property in service and that which
may be available for transfer.
American Appraisai Associates
Ms. Kathy DuBose 6 May 3, 1993
2. Insurance Requirements and Administration - This
objective requires the development of accurate
contents descriptions along with the development of
replacement costs. This activity will also develop
a system for perpetuating the above valuation
conclusions and assisting the city in ongoing
proof-of-loss services in the event of a required
claim against the insurance coverage.
3. In House Conversion - At the completion of the
assignment, and after the acceptance of our ap-
praisal reports by the City, we will provide a
personal computer based fixed asset system along
with the hardware to run it on. The hardware will
include:
ASTDX2-50 (IBM compatible) personal computer
8MB RAM
1.2MB 5 1/4 inch floppy diskette drive
1.44MB 3.5 inch diskette drive
200MB hard drive
14 inch Sony VGA color monitor
MS DOS 6.0 operating software
Panasonic 2624 Printer (wide spool)
Assets to be Appraised
The fixed assets to be included in this proposed engagement are
located in approximately 105 buildings and will include the
following:
Building and structures
Water and Sewer Mains
office furniture and equipment
American Appraisal Associates
Ms. Kathy DuBose 7 May 3, 1993
Computer hardware, personal computer, printers and
other related equipment
Copy Computer hardware
Copy machines and related equipment
Reproduction equipment
Telecommunication equipment
Fleet vehicles and Rolling stock
Heavy machinery and equipment
Minor machinery and equipment
Laboratory and testing equipment
Cash registers and related equipment
Also incorporated into the record, based on information supplied by
the City are land, radios, library books, computer software,
records, diskettes, cassettes, films, framed art, and licensed
vehicles.
Leased equipment, expendable inventories, supplies, and personal
property of employees or others will be excluded. We will make no
investigation of, nor assume any responsibility for the existence
or impact of any hazardous substance, which may or may not be
present on the property, in the development of our appraisal
conclusion.
III. FIELD PROCEDURES AND SPECIFIC DATA ELEMENTS
TO BE COLLECTED
The field investigation and inventory of the specific locations
will be conducted by staff appraisers who are permanently employed
by American Appraisal's Property Appraisal Services Group. It is
recommended that an initial planning meeting be held with the
Directors of Accounting, Data Processing, and Purchasing to firmly
establish parameters to be followed during the engagement. This
initial meeting will include topics such as:
(1) The current policies of the City regarding
capitalization, accounting, depreciation,
asset management, economic life, department
cost centers, and available cost records.
(2) Finalizing an exact schedule of our work, and
arrangements whereby department heads will extend
full cooperation to our appraisal staff to insure
accessibility to properties.
(3) Selecting as a liaison, an individual employed by
the City who is aware of the appraisal objectives
and with whom we will interface on a daily basis.
(4) Review our intended report formats for the final
output of the engagement and confirm the delivery
date.
American Appraisal Associates
Ms. Kathy DuBose 8 May 3, 1993
(5) Receive any available listings of audio visual
software, computer software, vehicles, land, li-
brary books, and the like.
(6) Establish procedures for City personnel to perpetu-
ate the property records after the appraisal inven-
tory is taken. Please note, it is critical to
implement this step at this stage of the engagement
in order to protect the sizable investment in the
appraisal by taking into account the additions,
transfers, and retirements which would begin to
occur immediately following our physical inventory.
(7) Review the property locations and asset clas-
sifications that are to be included, and
excluded, as part of the appraisal project.
(8) Review the inventory procedures, methodology, and
valuation procedures that will be followed.
(9) Arrange for work space to be used by the appraisal
staff during the field work period.
(10) Discuss with the data processing representa-
tive the field requirements and hierarchy
required for input to LGFS.
This detailed inventory and appraisal service will include a
physical inspection and inventory of all City owned property previ-
ously identified as being included in this engagement. The
following specific data elements will capture:
1. Asset Location - A series to identify the physical
location of the appraised property (floor, room).
2. Building Identification - Where used, existing
numerical identifications will remain; unidentified
space will be numbered sequentially following the
last assigned number.
3. Department - Existing numbers will be utilized.
When not available, AAA will identify those partic-
ular areas. Generally, only one unit number will
be applied to a particular space. The largest
department representation will be utilized.
4. Asset Number - A sequentially assigned asset number
placed on controlled property by the Fixed Asset
System. This will be the bar coded tag that is
of fixed to each controllable asset (greater than
$ 00)
`V
American Appraisal Associates
Ms. Kathy DuBose 9 May 3, 1993
5. Asset Account - A major classification of property
to identify major grouping of assets, i.e., equip-
ment, vehicles, etc.
6. Asset Classification - A sub-division of property
to further identify assets, i.e., outdoor equip-
ment, business machines, data processing equipment,
furniture, audio visual equipment, fire equipment,
food service equipment, etc.
7. Quantity - Unit controlled property will be record-
ed as one.
8. Asset Description - Manufacturer's name, model,
generic nomenclature and serial number will be
utilized for unit controlled property.
9. Acquisition Date - When readily available, AAA will
use the actual acquisition date of property. In
the absence of readily available information, the
acquisition date will be estimated based upon our
knowledge of the property type and its condition.
10. Estimated Life - An estimate will be made of the
useful life of each unit and group controlled
asset. The remaining useful life will be deter-
mined from the estimated life and date of acquisi-
tion and printed on reports.
11. Insurable Value - Cost of Reproduction New (Re-
placement Cost) as of the appraisal date will be
used as a basis for insurable values for all in-
cluded property.
12. original /Historical Cost - Where known, we will use
the actual original cost and acquisition date for
the property inventoried. When invoices or accu-
rate records are not readily available, we will
utilize standard costing or normal costing, both of
which are defined below.
In our position as a third party, professional
appraisal firm with substantial expertise in
property accounting, these estimates are both
accurate and well regarded by those who will
be scrutinizing our reports.
Direct Costing - Inventoried units/groups will
match a historical cost record and will be recorded
at that amount, if possible.
Standard Costing - Inventoried property
American Appraisal Associates
Ms. Kathy DuBose 10 May 3, 1993
units/groups not reconciled to a historical record
will receive an estimated cost, where possible,
based on a Standard Cost; a known average installed
cost for a like unit estimating acquisition date.
The unit's age is estimated based on observed
condition, manufacturer's name, model, serial
number, age of the facility, etc. Standard costs
for many equipment items are available from our own
files and records.
Normal Costing - Where neither of the above tech-
niques can be employed to apply historical cost,
cost is estimated based on a present Cost of Repro-
duction New indexed by a reciprocal factor of the
price increase from the estimated date acquired to
the appraisal date. GAAP states "...it may be
impossible or time consuming to reconstruct the
actual cost of the property. In this situation,
the original cost of the property may be estimat-
ed..." (Section 30.07 of HBJ MILLER Governmental
GAAP Guide 1993).
13. Accounting Depreciation - Accumulated and
annual depreciation will be calculated, and
reported, for all capitalized assets, if
requested.
14. Fund Source`Fund Code - Where known, the source of
funds will be recorded. It is difficult to identi-
fy the source of funds during the inventory so many
times this information is entered by our clients on
a "preliminary" report provided by AAA and we
update the files before providing final reports.
15. Status Code - All inventoried assets will be iden-
tified as in use, surplus, or needs repair/obso-
lete. This code will be printed on the inventory
reports.
Once the inventory and tagging is complete we enter our costing and
pricing phase. Utilizing the results of our inventory, records you
furnish, and our own records and computer capabilities, we assign
an estimated Original Cost, Cost of Reproduction New, and year of
acquisition to each controllable unit. Both our inventory and
costing phases follow generally accepted accounting principles
(GAAP). The same staff who performs the inventory also does the
pricing.
Inventory Control/Capitalization Level and Grouping
Inventory control will be on a room-by-room basis with organiza-
American Appraisal Associates
Ms. Kathy DuBose 11 May 3, 1993
tional unit structure being shown. All assets included will be
inventoried if their replacement cost is greater than $300.
Taaainq
AAA will provide a bar code label printer manufactured by SATO
(model 8400 or 8450). This printer and associated software works
with an IBM compatible personal computer which we will provide for
the application. The printer uses an ink ribbon along with a "heat
process" to produce the tags. The actual model and type of
material for the tags will be determined after discussion with City
personnel familiar with the requirements of the project. Bar coded
tags will be affixed to all assets with a value of $300 or greater.
IV. INVENTORY VALUATION
Based upon an analysis, pricing, and processing of these records,
we will furnish our opinion of the following for all city owned
contents:
Cost of Reproduction New (CRN)
Cost of Reproduction New is the amount required to
reproduce the entire property at one time in like kind
and materials in accordance with current market prices
for materials, labor and manufactured equipment, con-
tractors' overhead and profit, and fees, but without
provision for overtime or bonuses for labor and premiums
for material or equipment.
Cost of Reproduction New is synonymous with the insurance
industry term "Replacement Cost".
The appraisal will not take into consideration the
replacement of the property to conform with building
codes, ordinances, and other legal restrictions; nor will
it consider the cost of demolition in connection with
reconstruction or the removal of destroyed property.
V. REPORTS FURNISHED
The Consultant will provide a full complement of reports (in dupli-
cate) reflecting the results of AAA's investigation, to include:
(1) A narrative for use by management and outside auditors
to provide assurance that the techniques and conclusions
are consistent with GAAP
(2) Certificate of Values
American Appraisal Associates
Ms. Kathy DuBose 12 May 3, 1993
(3) Glossary of Accounts and Descriptive Abbreviations used
(4) User Manual for Perpetuation Purposes
(5) Following Appraisal Reports:
Property Accounting Summary - Displays description
of fields being summarized, original cost, accumu-
lated depreciation, unrecovered cost, annual depre-
ciation and projected provision.
Property Accounting Ledger Report - Displays asset
tag number, class code, quantity, description,
model, manufacturer's name, serial number, depreci-
ation begin date, fund code, estimated life, origi-
nal cost, accumulated depreciation, annual depreci-
ation and projected provision. Only capitalized
assets appear on this report.
Insurance Summary - Displays description of fields
being summarized, reproduction costs, exclusions,
reproduction insurable cost, and original cost.
Insurance Property Record Report - Displays asset
tag number, location, status code, class code,
quantity, description, manufacturer's name, model
number, serial number, and reproduction cost. Both
capitalized and expensed assets appear on this
report.
Expiration Report - Displays all assets whose
normal useful life has expired.
Obsolete Asset Report - Displays all assets that
are obsolete, are no longer in service or that have
exceeded their economic useful life.
Class Code Report - A listing of assets by asset
type (class code).
All reports are laser printed on 8 1/2" x 1111 loose-leaf bond paper
for ease of duplication and reinventory use by staff.
VI. PROJECT STAFFING
Professionals assigned to this project will involve several levels
of management: executive review, district manager, project
manager, and the appraisal staff.
American Appraisal Associates
Ms. Kathy DuBose 13
CITY OF
DENTON
EXECUTIVE
REVIEW
PROJECT
MANAGER
APPRAISAL
STAFF
DISTRICT
MANAGER
The City of Denton project staff will include:
Executive Review:
May 3, 1993
Paul Gruenwald
Product Services Manager
Project Manager:
District Manager:
Jim Eastman
Engagement Manager
Jack Hughes
District Manager
The above professional staff members will have overall responsibil-
ity and are key personnel to the successful completion of the
assignment. Specific appraisal staff assignments may vary
depending upon current availability at the time of the authoriza-
tion to proceed with this project.
VII. BAR CODE READERS
The use of bar code tags is an efficient and economical means of
perpetuating an asset inventory. The initial step of applying a
tag, whether it be a normal tag or a bar code tag, usually involves
additional effort during the inventory. However, if bar code tags
are used along with portable scanners to read the tags, inventory
verification time can be reduced by as much as 70% over convention-
al methods.
American Appraisal Associates
Ms. Kathy DuBose 14 May 3, 1993
The benefits to you are speed, accuracy, and reduced costs through
efficiency. Cost savings are achieved by decreased staffing needs,
increased productivity, and decreased overtime. The average
payback period is 18 months.
American Appraisal Associates, Inc. will provide two (2) handheld
portable laser scanners that allow for the input of information
such as site/property, building, floor, department, room, status,
etc. All assets within a specific location are wanded by the bar
code reader. The output of the bar code reader is then down loaded
to a personal computer for direct input into a fixed asset system.
American Appraisal Associates, Inc. will format the output of the
bar code reader to be compatible with your fixed asset system.
The following illustrates how the verification process works:
LASER BAR On site Verification
CODE SCANNER 11 by Inventory Personnel
(cable)
(Communication Program)
IBM
COMPATIBLE
PC
CITY OF
DENTON
FA SYSTEM
(PC)
1. Update fixed asset records with
current building, room, floor,
department, date, quantity, status
code, tag number.
2. Exception reports
The use of bar codes provides an economical method of verifying the
location and existence of assets. To achieve an even work flow and
to gain the maximum usage of the bar code reading equipment, it is
recommended that the verification be done on a continuous basis
throughout the year. Your entity would be verified only once a
year, but the process would occur over the entire year. This
eliminates the manpower problem that occurs when all properties are
inventoried at the same time. After the information is updated,
inventory reports can be run and sent to each department for
American Appraisal Associates
Ms. Kathy DuBose 15 May 3, 1993
review. Exception reports can be run at this time listing all
assets that were not found but appeared on the last inventory
report.
We have had good experience using the model 960, laser bar code
reader manufactured by Telxon Corporation. Telxon Corporation is
a worldwide organization and the leader in the field of portable
handheld data collection devices. Their equipment is dependable,
well designed, and most important field upgradable when new
technology is announced. The model 960 is a single unit weighing
only 30 ounces. It includes in the single unit the rechargeable
Nicad batteries, built in battery charger, fail safe battery
backup, and a four line display. Only a single piece of equipment
has to be carried to perform the inventory verification. Included
with the model 960 laser scanner is the customized program that
allows the user to input building, room, floor, department, date,
quantity, status, and asset tag number. The location information
is automatically duplicated for each asset until one of the fields
changes at which time the field is changed and the verification
continues. The asset tag number can be either wanded into storage
by use of the bar code scanner or by keyboard entry if the tag is
not scannable. Some users affix bar coded location tags to door
jams of rooms which are read when entering the room. This
eliminates all manual (keypad) entry of information.
The data is down loaded to an IBM compatible personal computer
using a standard RS232C interface and any standard communication
software such as PROCOMM. The down loaded file is a standard ASCII
file formatted for direct input into the City's fixed asset system.
The reformatting is part of our service.
American Appraisal Associates, Inc. will supply the data entry
program, communication program (PROCOMM), laser scanner, cables,
and user manuals that are necessary to operate the scanners and
PC's. There will be no development work on your part. The bar code
scanner will be programmed to read both Code 39 and Code 128 bar
codes.
VIII. FIXED ASSET SOFTWARE SYSTEM
The PC based fixed asset system American Appraisal will provide is
written by Municipal Administrative Solutions, a national software
firm specializing in software for the public sector. This firm has
rewritten their fixed asset system per the specifications of
American Appraisal and includes an interface from the Bar Code
Scanner to their system. An ad-hoc report program (IDOL IV) is
available with the system that allows non-programmers to produce
on-screen inquires or reports. In a matter of minutes it is
possible to build and display, or print, queries or reports. You
simply step through pick and choose windows to build your requests
with no programming, codes, or commands. In fact, you can easily
American Appraisal Associates
Ms. Kathy DuBose 16 May 3, 1993
build your own data files and these files can be linked to any
existing data files.
Literature describing the features of the system is included with
this proposal. Three days of on-site training is included as part
of our proposal and a toll free 800 number is available to answer
any questions and assist in the installation process. There is no
maximum usage limit on the toll free assistance.
IX. TIMING AND DELIVERY
Based on our current commitments, we would anticipate delivery of
our final reports within 120 days after authorization. The
following outlines the possible timing of our effort:
Authorization
June
15,
1993
Planning Meeting
June
22,
1993
Field Inventory
July
15,
1993
Office Pricing
August
14,
1993
Office Processing and Review
September
15,
1993
Report Delivery
September
30,
1993
Because of our size, we have the resources and flexibility to
adjust our schedule to best suit the requirements of the City. If
the above schedule needs to be altered, we will work with you to
arrive at a mutually convenient schedule.
X. FEES AND PAYMENT
We estimate our fees for this engagement to be as follows:
Fixed Asset Appraisal including tagging
* SATO Model 8450 label printer including tag
stock
* ASTDX2-50 PC, Sony VGA monitor, and
Panasonic 2624 printer
* Bar Code Readers (2)
PC based Fixed Asset System
Fixed Asset System Only
IDOL IV Ad-hoc report program
3 Days on-site training
Annual Trend Factors (Optional)
* Includes One Year Factory Warranty
Copy of Master file on computer
tape
$56,000
$ 5,700
$ 4,000
$ 6,200
$ 1,500
$ 800
$ 2,275
$ 500
No Charge
No Charge
American Appraisal Associates
Ms. Kathy DuBose 17 May 3, 1993
Expenses are included in the above fee estimates. These fees are
based on our estimate of professional services to be furnished
according to our understanding of your requirements and in no way
are contingent upon the outcome of our conclusions.
American Appraisal will invoice you for professional services
rendered. You will be invoiced for portions of the balance of
professional fees on four occasions:
(1) 50% will be due upon completion of inventory sweep
(2) 33% will be due upon delivery of reports; and
(3) 17% will be due 30 days after delivery of the
final report.
All invoices are payable by the City upon receipt.
We reserve the right to withhold delivery of our advance conclu-
sions or final report(s) if, when either of these are ready for
delivery, any previously issued invoices remain unpaid.
In the event invoices are not paid on a timely basis defined as
within thirty (30) days of receipt, allowing normal mail delivery,
we reserve the right to charge interest calculated on the basis of
one and one-half percent (1-1/2%) per month will be due and owing.
American Appraisal will re-invoice you on the anniversary date of
the 31st day of the original invoice, this re-invoiced amount will
reflect the addition of the interest charge. Non-payment of re-
invoiced amount will be adequate cause to cease all work effort and
to withhold delivery of conclusion( s) and/or reports until such
time as the re-invoiced amount is paid.
The attached General Service Conditions apply to all professional
services provided by American Appraisal Associates, Inc.
If this proposal correctly reflects your understanding of our
agreement, please confirm such by signing and returning one copy.
Please note we will be unable to deliver any conclusions, verbal or
written, until we are in receipt of this acknowledgement. To avoid
any delays in delivery, you may wish to first Fax the signed
acknowledgement to (214) 490-9445. Thereafter, please forward the
original to us.
American Appraisal Associates
Ms. Kathy DuBose
Client of Record:
ACKNOWLEDGEMENT:
INITIAL
INITIAL
INITIAL
INITIAL
INITIAL
INITIAL
Name:
Title:
Date:
18
City of Denton
May 3, 1993
FIXED ASSET APPRAISAL INCLUDING TAGGING
SATO 8450 LABEL PRINTER
PC BASED FIXED ASSET SYSTEM WITH TRAINING
PERSONAL COMPUTER HARDWARE/PRINTER
BAR CODE READER
ANNUAL TREND FACTORS
American Appraisal Associates
Ms. Kathy DuBose 19 May 3, 1993
XI. GENERAL SERVICES CONDITIONS
The service (s) provided by American Appraisal Associates, Inc.,
will be performed in accordance with professional appraisal
standards. Our compensation is not contingent in any way upon our
conclusions of value. We assume, without independent verification,
the accuracy of all data provided to us. We will act as an
independent contractor and reserve the right to use subcontractors.
All files, work papers or documents developed by us during the
course of the engagement will be our property. We will retain this
data for at least five years.
Our report is to be used only for the purpose stated herein; any
use or reliance for any other purpose, by you or third parties, is
invalid. You may show our report in its entirety to those third
parties who need to review the information contained herein. No
reference to our name or our report, in whole or in part, in any
document you prepare and/or distribute to third parties may be made
without written consent.
You agree to indemnify and hold us harmless against and from any
and all losses, claims, actions, damages, expenses or liabilities,
including reasonable attorneys' fees, to which we may become
subject in connection with this engagement. You will not be liable
for our negligence. Your obligation for indemnification and
reimbursement shall extend to any controlling person of American
Appraisal Associates, Inc., including any director, officer,
employee, subcontractor, affiliate or agent.
We reserve the right to include your company/firm name in our
client list, but we will maintain the confidentiality of all
conversations, documents provided to us, and the contents of our
reports, subject to legal or administrative process or proceedings.
These conditions can only be modified by written documents executed
by both parties.
American Appraisal Associates
Ms. Kathy DuBose 20 May 3, 1993
REPRESENTATIVE LIST OF PUBLIC SECTOR
CLIENTS SERVED
City of Redondo Beach
City of Calexico
City of San Rafeal
City of San Leandro
City of Atascadero
City of Baldwin Park
City of Chico
Town of Colma
City of Lancaster
City of Santa Rosa
City of Vallejo
City of Alhambra
City of Azusa
City of Cerritos
City of Corona
City of Duarte
City of Imperial Beach
City of Manteca
City of Sunnyvale
City of Tracy
City of Yorba Linda
Board of Education, City of New York
City of New York - Infrastructure
State of New York - Buildings
State of Ohio - Buildings and Internal Service Funds
Alabama Municipal League (60 cities)
League of Minnesota Counties (20 counties)
City of Medina
City of Waukesha
County of Waukesha
Houston Department of Aviation - Airport
City of University Heights
Florida League of Cities
County of Sonoma
County of Cumberland
City of Seattle
Northwest Water Commission
City of Ketchikan
City of Golden
City of Pittsburgh, PA
American Appraisal Associates
Ms. Kathy DuBose 21 May 3, 1993
REPRESENTATIVE CLIENT LISTING FOR TEXAS MUNICIPALITIES
AND UNIVERSITIES
City of Allen
Brownsville Independent School District, Brownsville
East Texas Baptist University, Marshall
Georgetown Independent School District, Georgetown
The University of Hardin-Baylor Mary, Belton
City of Houston
City of Hutchins
Jordan School District, Sandy
Lancaster Independent School District, Lancaster
City of McKinney
City of Mexia
Pilot Point Independent School District, Pilot Point
San Antonio Independent School District, San Antonio
Socorro Independent School District, E1 Paso