HomeMy WebLinkAboutCC AG PKT 2011-06-13 #F AGENDA STAFF REPORT
DATE: June 13, 2011
TO: Honorable Mayor and City Council
THRU: Jill R. Ingram, Acting City Manager
FROM: Robbeyn Bird, CPA
Director of Administrative Services /City Treasurer
SUBJECT: CONSULTING SERVICES FOR PREPARATION OF A
FULL COST ALLOCATION PLAN AND A
COMPREHENSIVE FEE STUDY
SUMMARY OF REQUEST:
Staff requests that the City Council adopt Resolution No. 6138 approving the
agreement for consulting services between Matrix Consulting Group and the City
of Seal Beach and authorize the Acting City Manager to execute the agreement.
BACKGROUND AND ANALYSIS:
On February 14, 2011, the City Council authorized staff to issue a Request for
Proposal (RFP) for consulting services for the preparation of a full cost allocation
plan and a comprehensive fee study. Staff received three proposals in response
to the RFP. The following is a summary of the proposals:
NBS $46,125
Willdan 29,775
Matrix 24,460
The City of Seal Beach generates approximately $2.9 million in user fees and
charges annually derived from a variety of services providing a specific benefit to
the user. Best Practices in the Government Sector recommend that fees and
charges be evaluated and, if necessary, adjusted annually to ensure that they
generate sufficient revenues to meet service delivery costs. The user fee study
needs to be done to ascertain that the fee structure remains consistent and
closely aligned with the cost of providing certain services. The studies generally
provide a defensible methodology for determining the actual cost of providing
eligible City services such that the desired level of cost recovery and /or General
Fund subsidy can be ascertained and potential "new" fees and charges can be
evaluated.
Agenda Item F
Page 2
In addition, the full cost allocation plan will provide the City with well documented
results to recover indirect overhead support. The cost allocation plan will provide
useful management information for budgeting purposes, as well as it will identify
opportunities for General Fund reimbursement of overhead costs from various
funding sources such as grants, fees for service, capital projects, and other
general and non - general fund revenues.
Staff reviewed the proposals and invited two of the three most qualified and
responsive firms for interviews: Matrix Consulting Group and Willdan Financial
Services.
The firm of Matrix Consulting Group, although located in Palo Alto, also has an
office located in Irvine, CA. The firm has a reputation for producing a final
product in a timely fashion, on schedule and within the amount budgeted. The
staff that will be assigned to this project has extensive experience with other
coastal communities such as Newport Beach, Huntington Beach, Oceanside,
Solana Beach and Malibu. References provided were checked and the reviews
and comments were very favorable.
The firm of Willdan Financial Services is located in Temecula, CA. The firm has
an extensive background in the development of cost allocation plans and user
fee studies for municipalities and a long history of providing contract staff support
to public agencies. The cities of Montebello, Burlingame, American Canyon,
Laguna Hills, Hemet, and Irvine are a few of their past clients.
After careful consideration, staff has selected Matrix consulting group to perform
the cost allocation plan and the user fee study. Matrix Consulting Group is a
highly respected firm. They have a proven track record as reflected by the list of
accomplishments and references contained in their proposal (page 11). Staff
contacted several of the references listed on the "Client List" in the proposal and
confirmed without exception, that Matrix Consulting Group is a highly reputable
firm with exemplary performance, experience, accountability, and credibility.
FINANCIAL IMPACT:
Matrix Consulting Group fees for services to be provided are outlined in the
attached proposal in the amount of $24,460. This firm was the low bid out of the
three received. There are adequate funds budgeted in the 2011/12 budget for
completion of the cost allocation plan and the user fee study. The work will
commence after July 1, 2011.
Page 3
RECOMMENDATION:
Staff recommends that the Council adopt Resolution No. 6138 approving the
agreement for the cost allocation plan and user fee study between Matrix
Consulting Group and the City of Seal Beach and authorize the Acting City
Manager to execute the agreement.
SUBMITTED BY: NOTED AND APPROVED:
Robberd, CPA '• . Ingram,
Director of Administrative Services/ A cting City Manag
City Treasurer
•
Attachments:
A. Resolution No. 6138
B. Agreement for Cost Allocation Plan and User Fee Study
C. Exhibit "A" - Proposal for Cost Allocation Plan
RESOLUTION NUMBER 6138
A RESOLUTION OF THE SEAL BEACH CITY COUNCIL
APPROVING AN AGREEMENT BETWEEN THE CITY OF SEAL
BEACH AND MATRIX CONSULTING GROUP FOR
PREPARATION OF A COST ALLOCATION PLAN AND A USER
FEE STUDY
The City Council of the City of Seal Beach hereby resolves as follows:
SECTION 1. The Council hereby approves the agreement between the City of
Seal Beach and Matrix Consulting Group for preparation of a cost allocation plan
and a user fee study in an amount not to exceed $24,460 per year.
SECTION 2. The Council hereby directs the Acting City Manager to execute the
contract on behalf of the City.
SECTION 3. The City Clerk shall certify to the passage and adoption of this
resolution.
PASSED, APPROVED and ADOPTED by the Seal Beach City Council at a
regular meeting held on the 13th day of June 2011 by the following vote:
AYES: Council Members:
NOES: Council Members:
ABSENT: Council Members:
ABSTAIN: Council Members:
Mayor
ATTEST:
City Clerk
STATE OF CALIFORNIA }
COUNTY OF ORANGE } SS
CITY OF SEAL BEACH }
I, Linda Devine, City Clerk of the City of Seal Beach, do hereby certify that the
foregoing resolution is the original copy of Resolution Number 6138 on file in
the office of the City Clerk, passed, approved, and adopted by the Seal Beach
City Council at a regular meeting held on the 13th day of June , 2011.
City Clerk
PROFESSIONAL SERVICES AGREEMENT
COST ALLOCATION PLAN AND
COMPREHENSIVE USER FEE STUDY
Between
<% P R F"9C''b • * i
io 'Qi
I �, f y Q ,
' '4G' ' ' . : \ \..-:
City of Seal Beach
211 - 8th Street
Seal Beach, CA 90740
&
Matrix Consulting Group
721 Colorado Ave., Suite 101
Palo Alto, CA 94303
(650) 858 -0507
This Professional Service Agreement ( "the Agreement ") is made as of June 13,
2011 (the "Effective Date "), by and between Matrix Consulting Group( "Consultant "), a
Consultant, and the City of Seal Beach ( "City "), a California charter city, (collectively,
"the Parties ").
1 of 9
S7296- 000111236808v1.doc
RECITALS
A. City desires certain professional services.
B. Consultant represents that it is qualified and able to provide City with such
services.
NOW THEREFORE, in consideration of the Parties' performance of the
promises, covenants, and conditions stated herein, the Parties hereto agree as follows.
AGREEMENT
1.0 Scope of Services
1.1. Consultant shall provide those services ( "Services ") set forth in the
attached Proposal to Develop a Cost Allocation Plan and Comprehensive Fee Study
Exhibit A, which is hereby incorporated by this reference. To the extent that there is any
conflict between Exhibit A and this Agreement, this Agreement shall control.
1.2. Consultant shall perform all Services under this Agreement in accordance
with the standard of care generally exercised by like professionals under similar
circumstances and in a manner reasonably satisfactory to City.
1.3. In performing this Agreement, Consultant shall comply with all applicable
provisions of federal, state, and local law.
1.4. Consultant will not be compensated for any work performed not specified
in the Scope of Services unless the City authorizes such work in advance and in writing.
The City Manager may authorize payment for such work up to a cumulative maximum of
$10,000. Payment for additional work in excess of $10,000 requires prior City Council
authorization.
2.0 Term
The term of this Agreement shall commence as of the Effective Date and shall
continue for a term of 1 year unless previously terminated as provided by this
Agreement.
3.0 Consultant's Compensation
City will pay Consultant in accordance with the hourly rates shown on the fee
schedule set forth in Exhibit A for Services but in no event will the City pay more than
$24,460. Any additional work authorized by the City pursuant to Section 1.4 will be
compensated in accordance with the fee schedule set forth in Exhibit A.
2 of 9
S7296- 0001 \1236808v1.doc
4.0 Method of Payment
4.1. Consultant shall submit to City monthly invoices for all services rendered
pursuant to this Agreement. Such invoices shall be submitted within 15 days of the end
of the month during which the services were rendered and shall describe in detail the
services rendered during the period, the days worked, number of hours worked, the
hourly rates charged, and the services performed for each day in the period. City will
pay Consultant within 30 days of receiving Consultant's invoice. City will not withhold
any applicable federal or state payroll and other required taxes, or other authorized
deductions from payments made to Consultant.
4.2. Upon 24 -hour notice from City, Consultant shall allow City or City's agents
or representatives to inspect at Consultant's offices during reasonable business hours
all records, invoices, time cards, cost control sheets and other records maintained by
Consultant in connection with this Agreement. City's rights under this Section 4.2 shall
survive for two years following the termination of this Agreement.
5.0 Termination
5.1. This Agreement may be terminated by City, without cause, or by
Consultant based on reasonable cause, upon giving the other party written notice
thereof not less than 30 days prior to the date of termination.
5.2. This Agreement may be terminated by City upon 10 days' notice to
Consultant if Consultant fails to provide satisfactory evidence of renewal or replacement
of comprehensive general liability insurance as required by this Agreement at least 20
days before the expiration date of the previous policy.
6.0 Party Representatives
6.1. The City Manager is the City's representative for purposes of this
Agreement.
6.2. Greta M. Davis is the Consultant's primary representative for purposes of
this Agreement.
7.0 Notices
7.1. All notices permitted or required under this Agreement shall be deemed
made when personally delivered or when mailed 48 hours after deposit in the United
States Mail, first class postage prepaid and addressed to the party at the following
addresses:
•
/
3 of 9
S7296- 0001 \1236808v1.doc
To City: City of Seal Beach
211 Eighth Street
Seal Beach, California 90740
Attn: City Manager
To Consultant: Matrix Consulting Group
721 Colorado Ave., Suite 101
Palo Alto, CA 94303
Attn: Richard Brady, President
7.2. Actual notice shall be deemed adequate notice on the date actual notice
occurred, regardless of the method of service.
8.0 Independent Contractor
8.1. Consultant is an independent contractor and not an employee of the City.
All services provided pursuant to this Agreement shall be performed by Consultant or
under its supervision. Consultant will determine the means, methods, and details of
performing the services. Any additional personnel performing services under this
Agreement on behalf of Consultant shall also not be employees of City and shall at all
times be under Consultant's exclusive direction and control. Consultant shall pay all
wages, salaries, and other amounts due such personnel in connection with their
performance of services under this Agreement and as required by law. Consultant shall
be responsible for all reports and obligations respecting such additional personnel,
including, but not limited to: social security taxes, income tax withholding,
unemployment insurance, disability insurance, and workers' compensation insurance.
8.2. Consultant shall indemnify and hold harmless City and its elected officials,
officers, employees, servants, designated volunteers, and agents serving as
independent contractors in the role of City officials, from any and all liability, damages,
claims, costs and expenses of any nature to the extent arising from Consultant's
personnel practices. City shall have the right to offset against the amount of any fees
due to Consultant under this Agreement any amount due to City from Consultant as a
result of Consultant's failure to promptly pay to City any reimbursement or
indemnification arising under this Section.
9.0 Subcontractors
No portion of this Agreement shall be subcontracted without the prior written
approval of the City. Consultant is fully responsible to City for the performance of any
and all subcontractors.
4 of 9
S7296-0001 \1 236808v 1. d o c
10.0 Assignment
Consultant shall not assign or transfer any interest in this Agreement whether by
assignment or novation, without the prior written consent of City. Any purported
assignment without such consent shall be void and without effect.
11.0 Insurance
11.1. Consultant shall not commence work under this Agreement until it has
provided evidence satisfactory to the City that Consultant has secured all insurance
required under this Section. Consultant shall furnish City with original certificates of
insurance and endorsements effecting coverage required by this Agreement on forms
satisfactory to the City. The certificates and endorsements for each insurance policy
shall be signed by a person authorized by that insurer to bind coverage on its behalf,
and shall be on forms provided by the City if requested. All certificates and
endorsements shall be received and approved by the City before work commences.
The City reserves the right to require complete, certified copies of all required insurance
policies, at any time.
11.2. Consultant shall, at its expense, procure and maintain for the duration of
the Agreement, insurance against claims for injuries to persons or damages to property
that may arise from or in connection with the performance of this Agreement. Insurance
is to be placed with insurers with a current A.M. Best's rating no Tess than A:VIII,
licensed to do business in California, and satisfactory to the City. Coverage shall be at
least as broad as the latest version of the following: (1) General Liability: Insurance
Services Office Commercial General Liability coverage (occurrence form CG 0001);
(2) Automobile Liability: Insurance Services Office Business Auto Coverage form
number CA 0001, code 1 (any auto); and, if required by the City, (3) Professional
Liability. Consultant shall maintain limits no Tess than: (1) General Liability: $2,000,000
per occurrence for bodily injury, personal injury and property damage and if Commercial
General Liability Insurance or other form with a general aggregate limit is used, either
the general aggregate limit shall apply separately to this Agreement/location or the
general aggregate limit shall be twice the required occurrence limit; (2) Automobile
Liability: $1,000,000 per accident for bodily injury and property damage; and
(3) Professional Liability: $1,000,000 per claim /aggregate.
11.3. The insurance policies shall contain the following provisions, or Consultant
shall provide endorsements on forms supplied or approved by the City to state:
(1) coverage shall not be suspended, voided, reduced or canceled except after 30 days
prior written notice by certified mail, return receipt requested, has been given to the City;
(2) any failure to comply with reporting or other provisions of the policies, including
breaches of warranties, shall not affect coverage provided to the City, its directors,
officials, officers, (3) coverage shall be primary insurance as respects the City, its
directors, officials, officers, employees, agents and volunteers, or if excess, shall stand
in an unbroken chain of coverage excess of the Consultant's scheduled underlying
coverage and that any insurance or self - insurance maintained by the City, its directors,
5 of 9
S7296 -0001 \1236808v1.doc
officials, officers, employees, agents and volunteers shall be excess of the Consultant's
insurance and shall not be called upon to contribute with it; (4) for general liability
insurance, that the City, its directors, officials, officers, employees, agents and
volunteers shall be covered as additional insureds with respect to the services or
operations performed by or on behalf of the Consultant, including materials, parts or
equipment furnished in connection with such work; and (5) for automobile liability, that
the City, its directors, officials, officers, employees, agents and volunteers shall be
covered as additional insureds with respect to the ownership, operation, maintenance,
use, loading or unloading of any auto owned, leased, hired or borrowed by the
Consultant or for which the Consultant is responsible.
11.4. All insurance required by this Section shall contain standard separation of
insureds provisions and shall not contain any special limitations on the scope of
protection afforded to the City, its directors, officials, officers, employees, agents, and
volunteers.
11.5. Any deductibles or self - insured retentions shall be declared to and
approved by the City. Consultant guarantees that, at the option of the City, either:
(1) the insurer shall reduce or eliminate such deductibles or self - insured retentions as
respects the City, its directors, officials, officers, employees, agents, and volunteers; or
(2) the Consultant shall procure a bond guaranteeing payment of losses and related
investigation costs, claims and administrative and defense expenses.
12.0 Indemnification, Hold Harmless, and Duty to Defend
Consultant shall defend, indemnify, and hold the City, its officials, officers,
employees, volunteers and agents serving as independent contractors in the role of city
officials (collectively "Indemnitees ") free and harmless from any and all claims,
demands, causes of action, costs, expenses, liability, loss, damage or injury, in law or
equity, to property or persons, including wrongful death, in any manner arising out of or
incident to any acts or omissions of Consultant, its employees, or its agents in
connection with the performance of this Agreement, including without limitation the
payment of all consequential damages and attorneys' fees and other related costs and
expenses, except for such Toss or damage arising from the sole negligence or willful
misconduct of the City. With respect to any and all such aforesaid suits, actions, or
other legal proceedings of every kind that may be brought or instituted against
Indemnitees, Consultant shall defend Indemnitees, at Consultant's own cost, expense,
and risk, and shall pay and satisfy any judgment, award, or decree that may be
rendered against Indemnitees. Consultant shall reimburse City and its directors,
officials, officers, employees, agents and /or volunteers, for any and all legal expenses
and costs incurred by each of them in connection therewith or in enforcing the indemnity
herein provided. Consultant's obligation to indemnify shall not be restricted to insurance
proceeds, if any, received by Consultant, the City, its directors, officials, officers,
employees, agents or volunteers. All duties of Consultant under this Section shall
survive termination of this Agreement.
6 of 9
S7296- 0001 \1236808v1.doc
13.0 Equal Opportunity
Consultant affirmatively represents that it is an equal opportunity employer.
Consultant shall not discriminate against any subcontractor, employee, or applicant for
employment because of race, religion, color, national origin, handicap, ancestry, sex,
sexual orientation, or age. Such non - discrimination includes, but is not limited to, all
activities related to initial employment, upgrading, demotion, transfer, recruitment or
recruitment advertising, layoff, or termination.
14.0 Labor Certification
By its signature hereunder, Consultant certifies that it is aware of the provisions
of Section 3700 of the California Labor Code that require every employer to be insured
against liability for Workers' Compensation or to undertake self - insurance in accordance
with the provisions of that Code, and agrees to comply with such provisions before
commencing the performance of the Services.
15.0 Entire Agreement
This Agreement contains the entire agreement of the parties with respect to the
subject matter hereof, and supersedes all prior negotiations, understandings, or
agreements. This Agreement may only be modified by a writing signed by both parties.
16.0 Severability
The invalidity in whole or in part of any provisions of this Agreement shall not
void or affect the validity of the other provisions of this Agreement.
17.0 Governing Law
This Agreement shall be governed by and construed in accordance with the laws
of the State of California.
18.0 No Third Party Rights
No third party shall be deemed to have any rights hereunder against either party
as a result of this Agreement.
19.0 Waiver
No waiver of any default shall constitute a waiver of any other default or breach,
whether of the same or other covenant or condition. No waiver, benefit, privilege, or
service voluntarily given or performed by a party shall give the other party any
contractual rights by custom, estoppel, or otherwise.
7 of 9
S7296-0001\ 1236808v1 .doc
20.0 Prohibited Interests; Conflict of Interest
20.1. Consultant covenants that it presently has no interest and shall not
acquire any interest, direct or indirect, which may be affected by the Services, or which
would conflict in any manner with the performance of the Services. Consultant further
covenants that, in performance of this Agreement, no person having any such interest
shall be employed by it. Furthermore, Consultant shall avoid the appearance of having
any interest, which would conflict in any manner with the performance of the Services.
Consultant shall not accept any employment or representation during the term of this
Agreement which is or may likely make Consultant "financially interested" (as provided
in California Government Code § §1090 and 87100) in any decision made by City on any
matter in connection with which Consultant has been retained.
20.2. Consultant further warrants and maintains that it has not employed or
retained any person or entity, other than a bona fide employee working exclusively for
Consultant, to solicit or obtain this Agreement. Nor has Consultant paid or agreed to
pay any person or entity, other than a bona fide employee working exclusively for
Consultant, any fee, commission, gift, percentage, or any other consideration contingent
upon the execution of this Agreement. Upon any breach or violation of this warranty,
City shall have the right, at its sole and absolute discretion, to terminate this Agreement
without further liability, or to deduct from any sums payable to Consultant hereunder the
full amount or value of any such fee, commission, percentage or gift.
20.3. Consultant warrants and maintains that it has no knowledge that any
officer or employee of City has any interest, whether contractual, non - contractual,
financial, proprietary, or otherwise, in this transaction or in the business of Consultant,
and that if any such interest comes to the knowledge of Consultant at any time during
the term of this Agreement, Consultant shall immediately make a complete, written
disclosure of such interest to City, even if such interest would not be deemed a
prohibited "conflict of interest" under applicable laws as described in this subsection.
210 Attorneys' Fees
If either party commences an action against the other party, either legal,
administrative or otherwise, arising out of or in connection with this Agreement, the
prevailing party in such litigation shall be entitled to have and recover from the losing
party all of its attorneys' fees and other costs incurred in connection therewith.
22.0 Exhibits
All exhibits referenced in this Agreement are hereby incorporated into the
Agreement as if set forth in full herein. In the event of any material discrepancy
between the terms of any exhibit so incorporated and the terms of this Agreement, the
terms of this Agreement shall control.
8 of 9
S7296 -0001 \1236808v1.doc
23.0 Corporate Authority
The person executing this Agreement on behalf of Consultant warrants that he or
she is duly authorized to execute this Agreement on behalf of said Party and that by his
or her execution, the Consultant is formally bound to the provisions of this Agreement.
IN WITNESS WHEREOF, the Parties hereto, through their respective authorized
representatives have executed this Agreement as of the date and year first above
written.
CITY OF SEAL BEACH CONSULTANT
By: By: >(�
Jill R. Ingram, City Manager
Name: Richard Bra
Attest: Its: President
By: By:
Linda Devine, City Clerk
Name:
Approved as to Form: Its:
By:
Quinn Barrow, City Attorney
9 of 9
S7296- 0001 \1236808v1.doc
Full Cost Allocation Plan and
Comprehensive Fee Study
CITY OF SEAL BEACH, CALIFORNIA
COPY
Submitted by:
Matrix Consulting Group
Richard Brady, President
721 Colorado Ave., Suite 101
Palo Alto, CA 94303
(650) 858 -0507
March 23, 2011
matrix..,:
consulting group
TABLE OF CONTENTS
March 23, 2011
Page Number
1. TRANSMITTAL LETTER i
2 BACKGROUND AND PROJECT SUMMARY 1
3. FIRM QUALIFICATIONS AND EXPERIENCE 3
4. STAFF QUALIFICATIONS AND EXPERIENCE 5
5 PROJECTS WITH OTHER GOVERNMENT ENTITIES 11
6. PROJECT APPROACH 12
7. INDEPENDENCE 25
8. PROPOSED COSTS 26
9. RATES FOR ADDITIONAL PROFESSIONAL SERVICES 27
10. METHOD OF PAYMENT 28
1. TRANSMITTAL LETTER
s
consulting group
March 23, 2011
Ms. Robbeyn Bird
Director of Administrative Services
City of Seal Beach
211 Eighth Street
Seal Beach, CA 90740
Dear Ms. Bird:
The Matrix Consulting Group is pleased to have the opportunity to submit a
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study for the
City of Seal Beach. This proposal will not only demonstrate our exceptional skills and
experience required to meet the City's needs for this study, but also establish the
additional value of choosing a firm like the Matrix Consulting Group.
With the $17 billion State deficit forcing funding cuts to local governments as well
as the slowdown in the economy locally, the City of Seal Beach, like many others has
experienced a decline in sales and property taxes and has had to find ways to
consolidate programs and core services wherever possible. There are a few key areas
in which the Matrix Consulting Group can assist the City with additional cost recovery.
These areas include:
• Review and calculate City -wide indirect costs through the full cost allocation plan
— specific areas of interest are the Water Enterprise Fund and Sewer Enterprise
Funds — to ensure that the general fund recovers the appropriate level of support
costs that are currently provided.
• Review and analyze the full cost of providing Planning Services as well as review
the current contract for Building plan review, permitting and inspection services to
ensure that the City is recovering internal costs for support costs provided over
and above the contract costs, as well as, to ensure that the fee structure paid to
the Building contractor is reasonable based on the relationship to the fees
charged for user fee services.
• Review and analyze all user fee services for potential new fees, as well as
recommendations to the existing fee schedule based on experience, best
practices, appropriateness for the organization, technical capability, and.
reasonableness.
As staff prepares options for the FY 2012 budget, Matrix Consulting Group
believes that our extensive experience as well as the ability to enhance cost recovery in
the above outlined areas, we can assist the City to recover direct and indirect costs
721 Colorado Avenue, Suite 101 Palo Alto, CA 94303 . 650.858.0507 > 650.858.0509 fax
California, Illinois, Massachusetts, Maryland, Texas, Washington
•
whenever possible in FY 2012, as well as in future years. Our firm understands the
urgency and importance of maximizing revenue recovery.
The Matrix Consulting Group stands apart from other firms for the following
reasons:
• On -site presence and accessibility: The Matrix Consulting Group will help Seal
Beach reach its goals because we understand the City's issues and needs, and
are committed to serving our clients as a small firm that allows for a personal,
hands -on approach. We have prepared a variety of financial, management and
operational study engagements for jurisdictions throughout California, most
recently including Oceanside, Sunnyvale, Temecula and Rancho Santa
Margarita. This is facilitated by our proposed project manager's presence in
nearby Irvine.
• Prior project experience with other coastal communities — Greta Davis, the
Project Manager, has prior experience working with Newport Beach, Huntington
Beach, Oceanside, Solana Beach, Malibu and Grover Beach that provides
insight into the culture and environment of serving a coastal community.
• Qualifications: We have proposed a uniquely qualified and experienced project
team for this engagement. Our team includes Richard Brady, President of the
firm, and Greta M. Davis, a Senior Manager and proposed Project Manager. Both
have over 20 years of local government experience, primarily conducting similar
financial studies.
• Reputation for effective project management: Our project team has the ability
to produce the required product in a timely fashion, on schedule and within
budget, as well as to present findings to elected officials and the public. Our
references will attest to the personal attention, enthusiasm, timeliness and detail
provided on their projects.
For questions pertaining to the content of this proposal or for contract
negotiation, please contact me at rbradv matrixcq.net, or at the address and phone
number listed on this letterhead.
As President of the firm, I have the authority to negotiate on its behalf. Thank
you for the opportunity to present our services to you.
L
Ma Fix Consulting G oup
Richard Brady
President
matrix::
consulting group
2. BACKGROUND AND PROJECT SUMMARY
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Al location Plan and Comprehensive Fee Study
2. BACKGROUND AND PROJECT SUMMARY
The City of Seal Beach has requested a scope of work for a Full Cost Allocation
Plan and Comprehensive Fee Study that will produce the following deliverables:
• Full Cost Allocation Plan
• Comprehensive Master Fee Study
The City of Seal Beach has requested a scope of work for a Full Cost Allocation
Plan and a Comprehensive Fee Study. Despite the projected decrease in sales and
property taxes, the City was able to approve a balanced budget for Fiscal Year 2010 -11.
The City has undergone significant budget strategies to increase transparency and
understandability of the City's finances. In an effort to implement these changes, the
City added a new fund for purposes of vehicle and equipment purchases, as well as
including budgets for all funds of the City in the current budget.
The focus of this project is to enhance the efficiency and effectiveness of cost
recovery policy and procedure for the City of Seal Beach, which will assist the City with
the continued efforts of providing well documented financial information which is
available to the public. The Matrix Consulting Group understands the importance of
maximizing revenue recovery in this area. Our firm can not only calculate the full cost of
providing user fee services, we can ensure that the cost calculation is for the "full,
complete and adequate" service level, which will enable the City to recover 100% of
costs, wherever feasible. In addition, the full cost allocation plan will provide the City
with well documented results to recover indirect overhead support, including the newly
centralized Information Technology function that is provided by the general fund to the
enterprise funds and special revenue funds. The methodologies described in this
section have been commonly utilized and accepted by the local government industry for
more than 30 years.
Organizations often desire to examine the cost of administrative services
provided to third parties, utility funds, internal services, special revenue or enterprise
funds. A Cost Allocation Plan provides useful management information for budgeting
purposes, as well as identifies opportunities for General Fund reimbursement of
overhead costs from various funding sources such as grants, fees for service, capital
projects, and other general and non - general fund revenues.
By conducting the user fee study, the City follows a Finance / Budget Best
Management Practice of cost recovery review and analysis. The results of this study will
allow the City to accomplish the following objectives:
• Provide a well documented and defensible cost of service plan, including all
potential direct and indirect costs
Matrix Consulting Group Page 1
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
• Maximize recovery of indirect costs from the water and sewer enterprise funds,
grants, and fees and rates charged to the public.
• Implement defensible and appropriate fees for service in accordance with State
laws.
• Maintain a foundation for a routine and defensible update of cost allocation,
charges to other funds and user fees for service in future years.
Our firm and project team have assisted hundreds of local government agencies
in California and elsewhere in the United States maximize cost recovery of direct and
indirect costs.
Matrix Consulting Group Page 2
3. FIRM QUALIFICATIONS AND EXPERIENCE
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
3. FIRM QUALIFICATIONS AND EXPERIENCE
The Matrix Consulting Group is a national financial and management consulting
firm which was formed in July, 2002 and incorporated in January, 2003. The following
table provides basic descriptive information about the Matrix Consulting Group:
Firm Official Name:
The Matrix Consulting Group, Ltd.
Headquarters:
721 Colorado Avenue, Suite 101
Palo Alto, CA. 94303
v.650.858.0507 f.650.858.0509
Richard Brady, President
FEIN:
05- 0545979
•
Primary Contact Person
Richard Brady, President
rbradv matrixcg.net
The Matrix Consulting Group is a California corporation created by senior
consultants in pursuit of a service in which the senior people actually do the work in a
low overhead environment. Our firm's history and composition is summarized below:
• Our market and service focus is financial, management, staffing and operations
analysis of local government.
• We were founded in 2002. However, the staff of our firm have worked together
in this and other consulting organizations as one team for between 10 and over
30 years.
• We currently have seven offices — our headquarters is in Palo Alto, California.
We also have offices in: Irvine, California; Plano, Texas; Silver Spring, Maryland;
Edwardsville, Illinois; Andover, Massachusetts; and Spokane, Washington.
• We are incorporated in the State of California. We have four Directors — Richard
Brady is the President and Chief Financial Officer; Gary Goelitz is a Senior Vice
President; Randy Tan is a Vice President and Secretary; and Alan Pennington is
a Vice President.
• We currently have 13 full time and 5 part time staff.
The work on this project would be managed and performed from our:
Matrix Consulting Group Page 3
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
• Local, Irvine office by Senior Manager, Greta Davis (one year with the firm),
which houses two consultants. Greta Davis has extensive experience performing
Cost Allocation and User Fee studies for local jurisdictions for over seventeen
years.
• Palo Alto, California Headquarters by our President, Richard Brady (founder of
the firm — 9 years), which houses six consultants.
We are proud of our service philosophy based on detailed analysis as well as
extensive input and interaction with our clients. It has resulted in high levels of
implementation of our project recommendations.
Additionally, the Matrix Consulting Group has provided training to client staff on
numerous occasions, both in management auditing as well as cost analysis. All of our
professional staff are skilled at leading interviews, focus groups, and comparative
surveys as part of our typical scopes of work.
Our professional staff have conducted hundreds of cost allocation plan, user fee,
and other types of cost and operational analysis for cities, counties and state agencies
throughout the United States. As part of this firm and other firms, the professional staff
presented in this proposal have a combined experience of 40 years of cost allocation
experience. Financial Cost Studies account for approximately one half of our contracts
in California.
Matrix Consulting Group Page 4
4. STAFF QUALIFICATIONS AND
EXPERIENCE
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
4. STAFF QUALIFICATIONS AND EXPERIENCE
We are proposing a very experienced consulting team composed of individuals
having significant experience in the conduct of similar engagements. The following
organizational chart shows the team organization.
Richard Brady
President
Project Executive
Greta Davis
Senior Manager
Project Manager / Lead Analyst
Courtney Ramos
Consultant
Supporting Analyst
Each Matrix Consulting Group team member has successfully managed or
participated in similar studies to the City's requested scope of work. Specific project
experience for each team member is included in the resumes below.
The Matrix Consulting Group commits the staff described in this section for the
duration of the project. The project manager and lead analyst, Greta Davis, is located in
our Irvine office, and will be fully involved in the details of the project on a day -to -day
basis.
Matrix Consulting Group Page 5
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
RICHARD P. BRADY
PRESIDENT, MATRIX CONSULTING GROUP
Background: Richard Brady provides organization, staffing and management analytical services to
local government. In his extensive career, he has conducted over 600 projects for over 400 local and
state government client agencies. Richard Brady has been a management consultant to local
government for 30 years. Prior to creating his own consulting practice of Matrix Consulting Group, Mr.
Brady was MAXIMUS's Vice President for providing management auditing services nationwide. Before
that, he was the managing partner of the consulting firm of Hughes, Heiss & Associates.
Agency - Wide Studies: Conducted studies of entire city and county organizations. Scopes of work
included organizational structure and allocation of functions, management spans of control, service and
staffing levels, operational requirements as well as policies and procedures,
Albany, New York Los Gatos, California
Alachua County, Florida Monroe County, Michigan
Alexandria, Louisiana North Miami Beach, Florida
Allegan County, Michigan Palo Alto, California
Augusta, Georgia Portsmouth, New Hampshire
Beaufort County, South Carolina Portsmouth, Virginia
Brattleboro, Vermont Prescott Valley, Arizona
Burke County, North Carolina San Antonio, Texas
Burlington, Massachusetts San Clemente, California
Culpeper County, Virginia San Luis Obispo, California
Florence County, South Carolina Sunnyvale, California
Gainesville, Georgia Upper Merlon Twp, Pennsylvania
Hall County, Georgia Waltham, Massachusetts
Irvine, Califomia Wayland, Massachusetts
Lathrop, California West Boylston, Massachusetts
Los Angeles, California Whitman, Massachusetts
Administrative Services: Conducted studies of internal service functions, including human resources,
information technology, purchasing and risk management. Focuses included comparison to best
management practices and peer agencies, customer services approaches, support systems, etc.
Edmond (OK) — IT Salt Lake City (UT) — IT
Franklin County (OH) — Purchasing Santa Rosa (CA) — Purchasing
Irvine (CA) — Human Resources Sonoma County (CA) — Purchasing
Newport Beach — Risk Management Washington D.C. — Purchasing
Law Enforcement: Mr. Brady is a nationally recognized expert in the analysis of law enforcement,. He
has conducted police and sheriffs office studies which focused on service delivery strategies, patrol
deployments, scheduling and levels of proactivity, case management, records management systems
and business practices, policies and procedures, crime prevention programs.
Alaska Anchorage Nebraska Omaha
Arizona Goodyear, Prescott Valley Nevada Las Vegas Metropolitan PD
Matrix Consulting Group Page 6
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
RICHARD P. BRADY (continued)
PRESIDENT, MATRIX CONSULTING GROUP
California Alameda County, Anaheim, Butte New Hampshire Portsmouth
County, Citrus Heights, Contra Costa County, New York Albany, Carthage, Endicott, Vestal and
Galt, Gilroy, Glendale, Kern County, Los Angeles, Briarcliff Manor
Los Angeles County, Los Gatos, Lynwood, North Carolina Burke County and Durham
Monrovia, Napa, Ontario, Orange County, Michigan Alpena and Detroit
Palmdale, Palo Alto, Pittsburg, Poway, San Jose, Ohio Fairborn
Pasadena, San Bernardino, San Bernardino Oregon Clackamas County and Grants Pass
County, San Rafael, Santa Ana, Santa Monica, Pennsylvania York
Sunnyvale
Colorado Aurora South Carolina Beaufort County, Charleston
Florida Alachua County, Jacksonville, Jupiter, County, Hilton Head Island, Spartanburg County
North Miami Beach, Orange County, Pasco Tennessee Nashville- Davidson County and Knox
County, Pinellas County, Port Richey and Venice County
Georgia Americus, Augusta- Richmond County, Texas Arlington, Terrell, El Paso, Grand Prairie
Fulton County, Hall County, Chatham County, and Southlake
Americus and Gainesville Utah Salt Lake City
Louisiana Alexandria Vermont Brattleboro
Massachusetts Beverly, Boston, Lawrence, Virginia Leesburg and Loudoun County
Milford, Mansfield, Burlington, Pelham, Wayland, Washington Spokane, Kirkland and Snohomish
Westwood, Whitman County
Minnesota Anoka County Wisconsin Sun Prairie, Milwaukee
Missouri Des Peres and Raymore
Fire and Emergency Medical Services: Mr. Brady is also a nationally recognized expert in the
analysis of fire and emergency medical services. Projects have included evaluations of deployment,
station locations, response policies, company staffing, non -call utilization, fire prevention and
education, training, hazardous materials management, fire management and administration.
Alachua County, Florida Lansing, Michigan
Albany, New York Newark, California
Americus, Georgia Norwalk, Connecticut
Augusta, Georgia Omaha, Nebraska
Bellingham, Washington Palo Alto, California
Brattleboro, Vermont Peoria, Illinois
Bremerton, Washington Albany, Nevada
Broward County, Florida Salt Lake City, Utah
Burlington, Massachusetts San Rafael, California
Charlotte County, Florida Sarasota County, Florida
Cupertino, California Tallahassee, Florida
Hilton Head Island, South Carolina Venice, Florida
Planning and Building: Conducted studies of development review functions for local government.
Studies included evaluations of the organization of these functions, overlaps and duplications of
functions, cycle times for permits, technology, fees and cost recovery.
Cupertino, California Mountain View, California
Hayward, California Nantucket, Massachusetts
Hillsborough County, Florida Prince William County, Virginia
Matrix Consulting Group Page 7
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
RICHARD P. BRADY (continued)
PRESIDENT, MATRIX CONSULTING GROUP
Parks and Recreation: Evaluated parks and recreational functions for local government. Scopes of
work included how services meet community needs, the utilization of programs and facilities, the depth
of recreational programs, public - private partnerships, technology, parks preventive maintenance and
coordination of services with other service providers.
Davie, Florida Howard County, Maryland
Davis, California Santa Barbara, California
Cranford, New Jersey Campbell, California
Public Works and Utilities: Conducted studies of road, parks, fleet, traffic and other infrastructure
maintenance in addition to engineering. Study scopes included the effectiveness of maintenance
management, responsiveness to urgent and emergency calls, technology, crew sizes, fleet utilization
and specifications, staff utilization and the level of service to the community served,.
Alachua County, Florida Monterey County, California
Alameda County, California Newark, California
Albany, New York Oakland, California
Anaheim, California Ohio State Fair
Beverly Hills, California Pasadena, California
Campbell, California Philadelphia, Pennsylvania
Cuyahoga City, Oh Salt Lake City, Utah
Haverhill, Massachusetts San Clemente, California
Hercules, California San Luis Obispo, California
Hernando County, Florida San Rafael, California
Huntington Beach, California Springfield, Massachusetts
Kings County, California Washington D.C.
EDUCATION
Mr. Brady received his BA degree from California State University at Hayward and his MA and PhD
degrees from Oxford University, U.K.
Matrix Consulting Group Page 8
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
GRETA M. DAVIS
SENIOR CONSULTANT, MATRIX CONSULTING GROUP
Background: Ms. Davis has extensive cost analysis experience gained through her government
consulting experience for the past 25 years, including 9 years as in full -time management analyst roles
for three California cities. Her clients are principally cities and counties with a few special districts. Her
most recent experience has been working with clients to identify opportunities for process improvement
through automation and re- engineering; thus improving accuracy, efficiency and quality while reducing
cost. Her range of subject matter experience includes the following: Training and Quality Assurance,
Indirect Cost Rate Studies /Federal OMB A -87 Indirect Cost Allocation Plan development, Cost of
Service /User Fee Studies /Activity Based Cost Studies, Federal /State Jail Rates, Federal IV -D Indirect
Cost Reimbursement Agreements, Revenue Maximization, Process Re- engineering and Process
Improvement, Program Management and Budget Analysis, Generally Accepted Accounting Principles
(GAAP) and Sarbanes Oxley (SOX).
Revenue Enhancement, Cost Allocation Plans and User Fee Studies: Ms. Davis worked for
Maximus, Inc., a large national govemment consulting firm, as a project manager and consultant for
almost 17 years. The following provides a list of relevant project experience gathered over her career to
date:
OMB A -87 Compliant Cost Allocation Plans Cost of Service (User Fee) Studies
California: California:
Bay Area Air Quality District Butte County Moreno Valley
Galt Calexico National City
Long Beach Chula Vista Newport Beach
Los Angeles County Metropolitan Transportation Authority Covina Oceanside
(LAMTA)* Dana Point Orange
Mountain View Encinitas Orange County
Olivehain Water District Fresno Pasadena(in process)
Orange County* Grover Beach Rancho Cucamonga
Pasadena (in process) Hawthorne Rancho Palos Verdes
San Bernardino Imperial Beach Rancho Santa Margarita
Solano Irrigation District Irvine San Bernardino
Turlock Lancaster Tulare
Lathrop Turlock
Ohio: Lynwood Vallejo
Butler County Malibu Victorville
Cleveland Maywood Vista
Columbiana County Mission Viejo Yucaipa
Greater Cleveland Rapid Transit Authority (GCRTA)*
Portage National
Trumbull Athens, OH
Detroit, MI
*Projects submitted, reviewed and approved by State or Henderson, NV
Federal cognizant agencies Montgomery County, OH
Other Cost Allocation and Financial Studies: Ms. Davis has also performed a Sheriff County-wide
Booking Fee Analysis for Butte County, CA and a U.S. Marshall Per -Diem Jail Rate for Henry County,
Indiana, and was responsible for the preparation of the State Jail Rate Analysis for Ventura and Placer
Counties in CA. Additionally she performed Child Support Enforcement Title IV -D Agreements analyses
for Union County, OH, and development of their Child Support Enforcement Agency provider
agreements for Sheriff, Prosecutor, Juvenile Court, Common Pleas Court and the Clerk of Court.
Matrix Consulting Group Page 9
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
GRETA M. DAVIS
SENIOR CONSULTANT, MATRIX CONSULTING GROUP
Education and Affiliations:
B.A., Social Science; Emphasis in Finance, University of California, Irvine, 1990
Risk Management Certificate, University of California, Riverside, 1992
MMASC — Municipal Management Association of Southern Califomia
University of CA, Irvine Alumni Association
Matrix Consulting Group Page 10
5. PROJECTS WITH OTHER GOVERNMENT
ENTITIES
•
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
5. PROJECTS WITH OTHER GOVERNMENT
ENTITIES
Below are several project summaries as well as contact information for selected
reference assignments:
Client / Project Contact Information Description of Services
City of Calexico, CA Judith Hashem 2008 -09 Citywide Cost Allocation Plan,
Finance Director OMB A -87 Cost Plan, User Fee Study
(760) 768 -2130 Greta Davis
hashemi
City of Rancho Santa Mr. Paul Boyer 2008 -09 Citywide Cost Allocation Plan,
Margarita, CA Administrative Services Dir. OMB A -87 Cost Plan, User Fee Study
(949) 635 -1815 Greta Davis
pbover citvofrsm.ora
City of Tulare, CA Mr. Mark Kielty 2009 User Fee Study
Planning & Building Director
Greta Davis
(559) 684 -4217
mkieltv us
City of Elk Grove, CA Rebecca Craig Description of Services: Cost Allocation
Finance Director Plan for 2007/08 and 2008/09
(916) 627 — 3243 Courtney Ramos
rcraig(a.el karovecitv.orq
City of Richmond, CA Andrea Miller 2008 -09 Citywide Cost Allocation Plan,
Budget Administrator OMB A -87 Cost Plan
(510) 620 -6727 Richard Brady, Courtney Ramos
amiller ri.richmond.ca.us
City of San Luis Obispo, CA Katie Lichtig Public Works Management Study
City Manager FY 2011
(805) 781 -7114 Richard Brady
klichtiaslocitv.orq
City of Sunnyvale, CA Karen Miller 2007 -08 Community Development Cost of
Project Manager Services (User Fee) Study
(408) 730 — 7395 Richard Brady, Courtney Ramos
kmiller ..ci.sunnvvale.ca.us
Matrix Consulting Group Page 11
6. PROJECT APPROACH
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
6. PROJECT APPROACH
In this section of the proposal is described, in detail, the approaches the project
team would take to develop the cost allocation plan and user fee study. This section
opens with a summary of our proposed approaches. Following that will be a detailed
work plan that also includes the required description and estimated amount of time for
City staff support broken down by task, so that it relates directly to the work plan.
1. IMPLEMENTATION PLAN - MATRIX CONSULTING GROUP'S PROJECT
MANAGEMENT APPROACH
Our staff are experienced and effective project managers with proven track
records of meeting project schedule and budget requirements. Every project customized
for your specific needs and is managed according to the following essential project
management principles:
• Cross trained project managers: our senior level staff are cross trained in cost
and management analysis. No other firm better understands work processes and
service level assumptions behind fees for service. Again, we feel that our unique
experience, combined with our on -site facilitated gathering approach provides an
advantage over a traditional cost calculation provided by other firms.
• Senior professional staff do the work: A principal or senior member of the firm
performs the majority of client interviews and analysis on all of our projects.
Other firms primarily use mid to entry-level staff to complete their work.
• Workshop Data Gathering Approach: Our team of seasoned experts will
facilitate two data gathering workshops for the time and service level analysis
task of the Fee and Rate Study, which enables us to obtain more accurate data
than filling in a questionnaire. We feel that this approach is far superior to other
approaches more commonly used of completing time estimate questionnaires.
• Reputation for effective project management: Our references value the
personal attention, enthusiasm, timely delivery, and expert attention to detail
provided on their projects. This attention to project management is demonstrated
in our work approach provided in the detailed work plans for each project below.
• Quality Control: Our models, draft reports and final reports are proofed and
reviewed by a senior member of the project team to ensure accurate and quality
work products and results.
• Minimize Project Impacts on City staff: The Matrix Consulting Group is mindful
of the City's current workload, especially in light of reducing staffing levels and
shared or realignment of duties. As a result, our approach is to work with our
clients' staff to minimize the project impacts through strong project management,
Matrix Consulting Group Page 12
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
clear expectations of our roles versus staff roles and careful as well as realistic
scheduling. We assist our clients with manual data collection efforts; we also can
modify our work plans to accommodate each client's needs.
These approaches, focusing on detailed data collection and analysis by very
senior professionals, results in high levels of implementation and client satisfaction.
2. CLIENT SATISFACTION
The Matrix Consulting Group provides a chance for City Management and City
Council to review, ask questions, provide comments and feedback at the draft results
phase as well as the final report phase. This provides for opportunity for adjustment to
the final results to ensure satisfaction with the project results. We feel that the above
detailed project management approach, including detailed work plans, quality control
measures, efforts to minimize project impacts on City staff combined with our draft and
final review and input steps, provides systematic measures for our proven track record
of client satisfaction. We believe the above points are critical success factors for any
consulting engagement.
3. PROPOSED WORK PLANS / CITY STAFF SUPPORT IDENTIFIED
The following presents our proposed work plans to complete the requested
scope of work. The plan is presented two sections: (1) Full Cost Allocation Plan, and (2)
Comprehensive Fee Study.
COST ALLOCATION PLAN
A general outline of task steps required to complete a Full Cost Allocation Plan is
provided in the table below:
1. Establish Goals and Objectives for the Study and Initiate the Project
2. Structure Custom Cost Allocation Plan Model
3. Prepare and Review Draft Plan
4. Prepare and Present Final Plan
5. Provide Analytical Model / Training for City Staff
The following description of each task contains a narrative, associated
deliverables, and activities.
Task 1 Establish Goals and Objectives for the Study and Initiate the Project
Prior to our initial on -site meeting, the Matrix Consulting Group will provide the
City with a list of initial data requirements for the Study. Our project team will review this
information thoroughly in preparation for initial discussions with management and
department staff.
The Matrix Consulting Group will then conduct a kick -off presentation to staff and
member agencies regarding the scope, methodology, and timeline for the project, as
Matrix Consulting Group Page 13
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
well as initial meetings with the City's management staff to further clarify the intended
goals and purpose of the engagement. Any internal or external stakeholders may be
invited at the City's discretion. Discussion will include:
• Review of the City's specific needs and critical issues surrounding development
and implementation of the cost allocation plan.
• Opportunities for improvement and restructuring of previous plans, and /or review
and discussion of existing cost allocation methodologies performed in -house by
finance department staff
• Discussion of appropriate financial data to be utilized for the analysis
During this task of the project, the appointment of a project management
representative is imperative for the smooth flow of any engagement. This helps keep
the project on task, on schedule and on budget. In additional, this person may assist if
any potential analysis issues arise in order to identify the appropriate person to assist
and minimize the issue or potential down -time. This person's involvement is limited to
the scheduling of initial interviews with key personnel, as well as to direct our staff to the
appropriate location of documents and data required throughout the engagement.
Project Deliverable - MCG City Services Required
• List of basic data requirements for the Study • Basic data requirements for the Study as
• Kick -Off presentation to appropriate staff and listed by MCG (staffing, salary, budget, etc)
member agencies • Attendance at kick -off presentation and initial
• On -site initial meeting with Executive staff to Executive staff meeting
review goals, objectives, and project • Designate City project management
management plans representative
Estimated Hours: 4 — 8 hrs - Senior Manager Estimated Hours: 2 hours for the Finance
Department, and approximately 30 minutes for
each attendee of the kick off presentation and
Executive staff meeting.
Task 2 Structure Custom Cost Allocation Plan Model
To structure a custom cost allocation model, our project team would perform the
following tasks:
• Review and discuss the accounting (fund and organizational levels) and staffing
structure of the City, as well as the current operating budget or actual
expenditure report.
• Meet with each administrative services department to identify their major services
and document the most reasonable allocation basis of these costs to their
benefiting departments, funds, and activities.
Matrix Consulting Group Page 14
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
Project Deliverable - MCG City Services Required
• Staff interviews • Attendance at interviews
• Data collection for the structure, functions, • Provide consultant with data as requested
costs and allocation bases needed to • Review and discussion of consultant's initial
complete the first draft of the Plan interpretation of the data
Estimated Hours: 20 -24 hrs — Senior Manager Estimated Hours: Approximately 2 to 3 hours for
(8 -10) and Consultant (12 -14) each administrative department involved in the
Study
Task 3 Prepare and Review Draft Cost Allocation Plan
Based upon units of service identified in Task 2, allowable administrative costs
are allocated to each benefiting City department or operating unit. Costs are
summarized in the cost allocation plan for each receiver of services. Draft Cost
Allocation Plan will be provided, discussed, and reviewed with the appropriate City
Management staff, and will include a narrative summary of the results.
At this time, the project team will also advise the City staff on application and
implementation of the cost allocation plan for current and future needs.
Project Deliverable - MCG City Services Required
• Delivery and discussion of the Draft Full Cost • Review and provide requests for changes or
Allocation Plan points of discussion to the consultant
• Draft overhead rates for each department
• Draft narrative report that explains the
analysis
Estimated Hours: 24 hrs - Senior Manager (8- Estimated Hours: Approximately 2 hours for
10); Consultant (16) each administrative department involved in the
Study
Task 4 Prepare Final Full Cost Allocation Plan
Once the City's management team has reviewed the draft Plan from Task 3,
revisions are conducted in development of the final Plan. The final Plan is documented
in presentation format for the City's appropriate financial advisory committees and /or
City Council, etc. Overhead rates will be developed for each department using the final
results from the Cost Allocation Plan. In combination with the User Fee Study portion of
this scope of work, our project manager will attend and present the final results at up to
two Council meetings. If any Council review requires revision to the final version of the
plan, Matrix Consulting Group will revise and re -issue the final report.
Matrix Consulting Group Page 15
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
Project Deliverable - MCG City Services Required
• One to two rounds of revisions to finalize the • Review and approve final Full Cost Allocation
Full Cost Allocation plan plan
• Copies of Final Full Cost Allocation Plan and
e- version of the analytical model, as well as a
narrative report that explains the analysis
• Discussion and advice on implementation
• Presentation at up to two implementation
meetings with the City Council, etc.
Estimated Hours: 16 hrs - Senior Manager (8- Estimated Hours: Approximately 1 hour for each
10); Consultant (8) administrative department involved in the Study
Task 5 Provide Cost Plan Analytical Summary Table and Training for City
The City wishes to have the ability to update the final version of the Cost
Allocation Plan from year to year, including the ability to add or remove direct and
overhead costs, adjust rates, and add or delete service areas. Our cost plan can be
developed using our excel model and is available to the City at no additional cost. It will
enable the City to adapt and continuously update the model and Cost Allocation Plan
from year to year as the organization changes.
Project Deliverable — MCG City Services Required
• Computer based summary table of the final • Attend training session with Matrix Consulting
version of the Cost Allocation Plan Group
• Four (4) hours of on -site training for
appropriate Finance Department staff.
Estimated Hours: 4 hrs — Senior Manager Estimated Hours: Training attendance — 4 hours
CITYWIDE FEE STUDY
The table on the following page provides a general outline of task steps required
to complete a Comprehensive Master Fee and Rate Study:
1. Preliminary Data Collection
2. Project Initiation
3. Establish Goals and Objectives for the Study
4. Develop a Schedule of Current and Proposed Fees for Service
5. Conduct Time and Activity Data Workshop —1
6. Conduct Time and Activity Data Workshop — 2
7. Perform Total Cost Analysis
8. Compare Fees to Similar Jurisdictions
9. Review and Revise Results with City Departments
10. Prepare Final Report and Master Fee Schedule
11. Present Final Report
12. Provide Automatic Fee Update Model and Train City Staff
Matrix Consulting Group Page 16
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
The following descriptions of each task contain a narrative, associated
deliverables, and activities.
Task 1 Determine and Review Initial Documentation
The project team will provide the City with a written "Data Collection List" for the
Study. This data request typically includes basic budgetary, revenue, and staffing
information. This will also include a request for the list of the City's existing fees.
Before our first on -site visit, we will review this information to familiarize
ourselves with strengths, weaknesses and opportunities for improvement related to the
City's existing fee structure. In addition, we will familiarize ourselves with the budgetary
and staffing structures relevant to fees for service.
Project Deliverable - MCG City Services Required
• List of basic data requirements for the Study • Basic data requirements for the Study as
listed by MCG (staffing, salary, budget, etc)
Estimated Hours: 2 — 4 hrs — Consultant Estimated Hours: 1 -2 hours for the Finance
Department
Task 2 Initiate the Fee Study Project
The project team will conduct a project "kick -off' presentation for the
departments, including the goals of the engagement, the steps to complete the goals,
the time frame the departments can expect, the requests we will place on the
departments and the benefits of the engagement.
Project Deliverable - MCG City Services Required
• Employee briefing package and project • Attendance of staff involved or impacted by
initiation Power Point the study in a 30 minute project initiation
• On -site presentation meeting
Estimated Hours: 2 hrs — Senior Manager Estimated Hours: 0.5 hours per attendee
Task 3 Establish the City's Goals and Objectives for the Study, and Identify
Trends and Plans Which Impact Cost Recovery Analysis and Policy.
To effectively analyze and present the full cost of providing City services, it is
important that the project team develops an understanding of key issues which impact
and shape the City's service delivery and cost recovery policies. To develop this
perspective, we plan to conduct an initial meeting with the City's management staff to
solidify the exact parameters of the Study. It is essential to conduct an initial meeting of
this nature to ensure the project meets the City's expectations and requirements. As a
"user fee" study, Matrix Consulting Group does not propose to evaluate any fines, taxes,
Matrix Consulting Group Page 17
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
utility rates, or impact fees. Services and activities included in the study are those that
are defined specifically by an estimate of staff time devoted to providing each service.
Project Deliverable - MCG City Services Required
• On -site meeting with City management • Designated project management
involved in or impacted by the Study representative
• Project Management Plan • Approval of work plan as provided by MCG
Estimated Hours: 0.5 hours per executive staff
Estimated Hours: 2 hrs — Senior Manager member attending the meeting
Task 4 Develop a Schedule of Current and Potential Fees for Service.
The scope of this effort will be the fees charged by the City for the departments
identified. Current as well as potential fees and charges will be identified and
documented. This involves discussion with each department to identify the areas of
greatest potential cost recovery, and to structure and expand existing fee schedules for
both optimum cost recovery and fairness and equitability to the applicant for services.
At this time, the project team will request volume statistics to be used for staff
utilization and cost/revenue comparisons later in the analysis. The City will be
responsible for providing this data.
Project Deliverable - MCG City Services Required
• On -site meeting to discuss and revise fee • Participation in discussion of existing and
structures for each department proposed fee items for the analysis
• Thorough review of existing documentation • Review, comment, and approval of fee
and analyses that support the Department's structure report prepared by MCG
current fee structure and operations
• Report of proposed changes to existing fee
structures
Estimated Hours: 14 — 16 hrs — Senior Manager Estimated Hours: 3 hours per department
(4 -8); Consultant (8 — 10) studied
Task 5 Conduct Time and Activity Data Gathering Workshop 1
The project team will conduct a total of two workshops to gather time and activity
estimates for each service included in the study, using the following approach:
• Interview key personnel from each department and analyze the various activities
being performed within it that are both revenue and non - revenue generating.
Document basic process steps in application / permit processing.
• Establish the net available hours for each employee. Starting with a total of 2,080
hours per year less reductions for vacation, sick, training, etc., and also for
estimated "non- billable" time spent in meetings and supervisory or clerical roles.
Matrix Consulting Group Page 18
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
Project Deliverable - MCG City Services Required
• Facilitation of two -days of meetings related to • Attendance at workshop meetings
available net hour calculations, documentation • Provision of follow up data or discussion as
of service levels and global processes needed
associated with provision of services
Estimated Hours: 22 — 26 hrs — Senior Manager Estimated Hours: 2 - 4 hours for each
(12 -16 hrs); Consultant (10) department studied
Task 6 Conduct Time and Activity Data Gathering Workshop - 2
In each department's review, 100% of staff available hours are identified to both
fee and non -fee related services to ensure a complete and defensible analysis.
Project Deliverable - MCG City Services Required
• 1 — 2 iterations of review / revisions to achieve • Attendance at workshop meetings
a defensible and reasonable allocation of staff • Provision of follow up data or discussion as
time to fee and non -fee activities needed
Estimated Hours: 22 — 26 hrs — Senior Manager Estimated Hours: 1 - 3 hours for each
(12 -16 hrs); Consultant (10) department studied
Task 7 Perform Total Cost Analysis
The Matrix Consulting Group's costing method is a build -up approach" to fee and
rate analysis. This costing method uses time and annual activity level data to establish
the cost of providing services on both a unit and annual level. Once the time spent for a
fee activity is determined for each individual or position, the Matrix Consulting Group will
use its fee and rate software to apply all applicable City costs toward the calculation of
the full cost of providing each service. The following table details a description of the
typical costs considered as applicable to fees and rates.
Cost Component Description
Direct Salaries, benefits and allowable departmental expenditures
Departmental Overhead Departmental administration /management and clerical support
Citywide Overhead City costs associated with central service costs such as payroll,
human resources, etc. Established through the results of the Citywide
Full Cost Allocation plan performed by the Matrix Consulting Group.
Cross - Departmental Support Costs associated with review or assistance in providing specific
services. For example, costs established via study of the Planning
department for review of Building permits are included as overhead to
building permit fees.
Plans, Policies, and Systems Examples: General Plan Update, code enforcement, and technology
Maintenance related costs.
Matrix Consulting Group Page 19
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
Resulting costs are presented on a unit and annual level, and are compared to
the existing fee schedule and revenue reports. The City will obtain information about
cost recovery surpluses and deficits on both a detailed (per unit) and global
(annualized) level, as well as an understanding of itemized cost components for each
service.
Project Deliverable — MCG City Services Required
• Detailed documentation of current charges • Provision of follow up data or discussion as
versus the actual cost of providing services needed
from both a cost per unit and annual cost
perspective
Estimated Hours: 1 - 3 hours for each
Estimated Hours: 20 -24 hrs — Senior Manager (8 department studied
— 16); Consultant (10 -12)
Task 8 Conduct a Fee Comparison Survey of Similar Cities in Orange
County and Coastal California
The project team will work with the City to identify up to 5 comparable
jurisdictions targeted for the fee comparison survey. Comparable jurisdictions will
include those within Orange County or other California cities that are comparable to the
City of Seal Beach. We will also develop the survey tools and select up to 10 of the
most appropriate fee items in each Department for benchmarks (with City concurrence).
Then, we will administer the survey, collect comparative data, conduct the comparison,
and document the results.
Project Deliverable — MCG City Services Required
• Survey of fees in similar jurisdictions • Review of proposed jurisdictions and list of
• Written comparative summary of the results comparable fees to be included in the survey
Estimated Hours: 14 hrs — Senior Manager (2- Estimated Hours: 1 hour per department studied
4); Consultant (10 -12)
Our benchmarking of neighboring / comparable cities will be for both the fee
amounts and, to the extent this information is available cost recovery / subsidy
percentages.
Task 9 Review / Revise the Fee Study Results with Departments and City
Management
Because the analysis of fees for service is based on estimates and information
provided by City staff, it is extremely important that all participants are comfortable with
our methodology and with the data they have provided.
Matrix Consulting Group Page 20
•
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
Once the Department agrees that the analysis reflects the reasonable costs of
providing services, City management will have an opportunity to review the results. The
project team will address the following:
• Economic and revenue impacts of proposed and recommended fee levels and
methodologies, including fee affordability for small projects and applications
• Implementation strategy that considers both policy issues and goals for optimum
cost recovery. While it is generally desirable to eliminate any subsidies,
discussions regarding the feasibility of raising fees based on political climate,
legal restrictions, and social and economic consequences must occur.
Project Deliverable — MCG City Services Required
• Approval of analytical results at the • Review of final analytical model
Department and City management levels documentation
• Formulation of cost recovery • Attendance at meetings related to discussion
recommendations and associated revenue of results and economic policy implications
impacts • Follow up data or discussion as needed
• Estimated Hours: 1 - 3 hours for each
Estimated Hours: 12 — 16 hrs — Senior Manager department studied
(8 -10); Consultant (4 -8)
Task 10 Prepare a Final Report and Master User Fee Schedule
Upon the conclusion of the fee study, we will prepare a detailed report which
summarizes the results of each of the previous work tasks described above. This report
includes the following:
• A narrative describing the services included in the study, as well as the
methodology, recommendations, and key decision points to be considered.
• Appendices which compare existing and potential cost recovery on a unit and
annual basis by department.
• A Master User Fee Schedule to include within the City's Council adoption packet.
The report would be reviewed, revised and finalized with department and City
management.
Project Deliverable - MCG City Services Required
• Preparation and approval of the Final Citywide • Review and approval of Final Report drafts.
User Fee Study repot
• Delivery of Final Report
Estimated Hours: : 12 — 16 hrs — Senior Estimated Hours: 1 hour per reviewer
Manager (8 -10); Consultant (4 -8)
Matrix Consulting Group Page 21
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
Task 11 Present the Final Report to City Council
We will present the results to the governing body of our client. The presentation
of results to City officials and /or stakeholders is critical to the success of the overall
engagement. Since the product from the study is often controversial, the objective of
this final step is to present a very succinct, straightforward summary that provides
decision makers with key information. The Matrix Consulting Group will attend and
present the Study at up to two City Council study sessions or meetings (concurrent with
the Cost Allocation Plans).
Project Deliverable - MCG City Services Required
• Presentation of Study results at two regularly • Preparation discussion with the consultant
scheduled Council study sessions or and review of any presentation materials
meetings. required for Council meetings
• Preparation of City Staff Report
Estimated Hours: 8 hrs — Senior Manager or Estimated Hours: 4 hours Finance Department
President
Task 12 Provide User Fee Automatic Update Model
The Matrix Consulting Group recommends the City perform a complete update of
its fee analysis on a periodic basis. In general, a 3 — 5 year cycle for fee and rate
studies is sufficient to account for major shifts in organizational and cost structure. The
purpose of a comprehensive update to a fee study is to completely revisit the analytical
structure, service level estimates and assumptions applied in the previous studies.
In between comprehensive update cycles, the City should consider several
options for an automatic increase mechanism to the fee and rate structure. The first
would be to utilize published industry economic factors such as CPI or other regional
factors to update the cost calculations established in the fee analysis on an annual
basis. Alternatively, the City could also consider the use of its own anticipated labor cost
increases such as step increases, benefit enhancements, or cost of living raises.
The Matrix Consulting Group will assist the City in determining an automatic
increase mechanism for fee analysis as part of the overall scope of work defined in this
proposal. The Matrix Consulting Group will provide an Excel based worksheet for
performing an annual percentage increase, and train staff in the utilization of the
worksheet.
Project Deliverable - MCG City Services Required
• Excel -based software application to allow staff • Approval of application and attendance at
to annually adjust fee schedules based on a training related to updating fees on an annual
percentage increase (CPI or otherwise) basis
Estimated Hours: 8 hrs — Senior Manager Estimated Hours: 1 - 3 hours for identified City
representative
Matrix Consulting Group Page 22
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
Much of the knowledge transfer of how to conduct a user fee study will occur
within the tasks of the work plan above. We recommend that a designated City
representative attend all meetings of at least one or two departmental analyses to
understand the process and data components involved in conducting the study.
4. PROJECT SCHEDULE
A typical timeframe to complete a Study of this nature is approximately 12 to 16
weeks. The Cost Allocation Plan and User Fee Study deliverables will be managed
concurrently, as shown in the 16 -week timeline below:
Tasks 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
•
•
FULL / OMB CAPS
•
1. Initiate Project
2. Develop CAP Models
3. Draft Plans
4. Final Plans
5. Model / Training
•
•
•
FEE STUDY
1. Data Collection
2. Initiate Project
3. Goals & Objectives
4. Fee Structure
5. Data Workshop 1
6. Data Workshop 2 1111Mismi
7. Total Cost Analysis
8. Fee Survey
9. Review / Revise
10. Final Report
11. Present Report
12. Update/Training
Presentation of results and adoption by City Council would occur after delivery
and approval of the final report, at the discretion of the Finance Director. Delivery of
analytical summaries and worksheets, automatic update mechanisms and training
would occur either before or after the Council meetings, per the City's preference.
Matrix Consulting Group Page 23
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
5. RECORD KEEPING
The Project Manager maintains all project files, containing all working models,
data collected for analysis, as well as Draft and Final Reports. Files are backed up on a
weekly basis during the course of the project. Upon completion, final files and
documents are saved and stored at an off -site server to remain accessible for questions
or future assistance.
Matrix Consulting Group Page 24
7. INDEPENDENCE
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
7. INDEPENDENCE
The Matrix Consulting Group does not have any conflict of interest with the City
of Seal Beach, nor does any of the proposed project team.
Matrix Consulting Group Page 25
8. PROPOSED COSTS
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
8. PROPOSED COSTS
The Matrix Consulting Group is prepared to conduct this assessment at the level
detail in our project approach for $24,460 if contracted for both (there is a cost
savings when both projects are conducted concurrently) including both
professional time and expenses within our hourly rates, as follows:
President /
Task Sr. Manager Consultant Total Hours Total Cost
_FULL COST ALLOCATION PLAN
1. Initiate Project 4 4 $640
2. Structure Cost Plan Model 8 12 20 $2,180
3. Draft Plan 8 16 24 $2,480
4. Final Plan 8 8 16 $1,880
5. Analytical Model and Training 4 0 4 $640
SUBTOTAL CAP 32 36 68 $7,820
FEE AND RATE STUDY _.
1. Data Collection / Review 2 2 $150
2. Initiate Project 2 0 2 $320
3. Goals and Objectives 2 0 2 $320
4. Fee Structure 4 10 14 $1,390
5. Data Workshop 1 12 10 22 $2,670
6. Data Workshop 2 12 10 22 $2,670
7. Total Cost Analysis 8 12 20 $2,180
8. Comparative Fee Survey 2 12 14 $1,220
9. Review and Revise Results 8 4 12 $1,580
10. Final Report / MFS 8 4 12 $1,580
11. Present Final Report 8 0 8 $1,280
12. Automatic Update Model / Training 8 0 8 $1,280
SUBTOTAL FEE STUDY 74 64 138 $16,640
TOTAL HOURS 106 100 206
RATE PER HOUR $160 $75
TOTAL COST $16,960 $7,500 $24,460
TRAVEL $0
TOTAL PROJECT COST $24,460
Matrix Consulting Group Page 26
9. RATES FOR ADDITIONAL PROFESSIONAL
SERVICES
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
9. RATES FOR ADDITIONAL PROFESSIONAL
SERVICES
Hourly rates for Matrix Consulting Group staff for additional professional services
are provided in the table below:
Senior Manager $160 per hour
Consultant $75 per hour
Matrix Consulting Group Page 27
10. METHOD OF PAYMENT
CITY OF SEAL BEACH, CALIFORNIA
Proposal to Conduct a Full Cost Allocation Plan and Comprehensive Fee Study
10. METHOD OF PAYMENT
We would be prepared to enter into a fixed price contract for any / all scopes of
work included above. Our typical procedure for invoicing is to bill on a monthly basis for
hours and expense incurred on the project. The final ten percent (10 %) of the Total All-
Inclusive Maximum Price will be paid upon delivery of the firm's final reports.
Matrix Consulting Group Page 28