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[Auburn 2024 Utility Comprehensive Plan Financial Update] January 12, 2024 Page 1 of 12
CITY OF AUBURN
AGREEMENT FOR SERVICES
Auburn 2024 Utility Comprehensive Plan Financial Update.
THIS AGREEMENT made and entered into on this 12th of January, 2024, by and
between the CITY OF AUBURN (“City”), a municipal corporation of the State of Washington, and Financial Consulting Solutions Group, Inc. (FCS GROUP) (“Provider”), whose address is 7525 166TH Avenue NE, Suite D-215, Redmond, WA 98052.
In consideration of the conditions and the mutual promises and covenants contained in this Agreement, the parties agree as follows:
1. Scope of Services The Provider agrees to perform the tasks described in Exhibit A to this Agreement. The Provider will be responsible to provide work products and services of a quality and professional standard acceptable to the City. Without additional compensation, the Provider will correct or revise any negligent errors, omissions or other deficiencies in any required plans, designs, drawings, specifications, reports and/or other services, whether during or after the Term of this Agreement. The City’s approval of Provider’s services will not in any way relieve the Provider of responsibility for service accuracy and adequacy. 2. Additional Services The Parties will amend this Agreement if additional services are required beyond those specified in Exhibit A and/or included in the compensation amount for this Agreement. An amendment must be written and agreed to by the Parties before Provider performs any
additional services, and it must specify the nature, scope, and payment terms for the additional services. If the time period for completing additional services makes the advance signing of an amendment impractical, the Provider agrees to perform only the
additional services requested in writing by an authorized City representative pending the signing of an Amendment as set forth in this Section. The invoice procedure for any additional services is described in Section 4 of this Agreement.
3. Provider’s Representations & Qualifications The Provider represents and warrants that it has all required licenses, certifications and qualifications to perform the services in this Agreement. Provider represents that its signatory to this Agreement has the requisite legal authority to bind Provider to the terms and conditions of this Agreement. 4. Compensation a. As compensation for the Provider’s performance of this Agreement, the City will pay the Provider the fees and costs specified in Exhibit B. The City’s payments will fully compensate Provider for work performed/services rendered and for all
labor, materials, supplies, equipment, overhead, profit, and incidentals necessary for Provider to complete the work.
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b. The Provider will submit monthly invoices or statements to the City detailing the
time spent on Exhibit A tasks. Upon its acceptance of the invoice or statement, the City will process it in its next billing/claim cycle, and will remit payment to the Provider (subject to any conditions or provisions in this Agreement or an
Amendment). This Agreement’s number must appear on all submitted invoices. Provider will submit copies of any documents supporting an invoice or statement to the City upon request. c. The not-to-exceed amount for this agreement is $74,080. The Provider will not undertake any work or otherwise financially obligate the City in excess of this not-to-exceed amount without the City’s advance written authorization. d. City payments to the Provider after the current year are contingent on available funds.
5. Time for Performance, Term, and Termination of Agreement a. The Provider will begin no work under this Agreement until authorized by the City
in writing. The term of this Agreement commences on the date that the last party signs it (as reflected on the signature page). Once commenced, Provider shall complete the performance of all services in Exhibit A on or before May 31, 2024,
unless the Parties otherwise agree in writing. b. Termination for cause. Either party may terminate this Agreement for cause
with written notice to the other party. A termination is “for cause” if a party substantially fails to perform in accordance with the terms of this Agreement through no fault of the other party. The notice will specify the termination reason(s) and its effective date. If the City terminates this Agreement for cause, all City payments otherwise due to Provider will be suspended and the City will have no further obligations to Provider. c. Termination for Convenience. The City may terminate this Agreement for convenience upon at least 7 days’ written notice to the Provider. The notice shall contain the termination effective date. If the termination is through no fault of the Provider, the City will compensate Provider for services performed up to the
termination effective date in accordance with the Exhibit B compensation rate. This compensation will fully satisfy the City’s obligations under this Agreement, and will discharge the City from any further obligations and liabilities to the
Provider (including any Provider claims of anticipated profits or other consequential damages resulting from the termination).
d. Upon receipt of any termination notice, the Provider will promptly discontinue all services and deliver to the City all data, drawings, specifications, reports, summaries, and such other information and materials the Provider has accumulated, prepared, or obtained in performing this Agreement (whether fully or partially completed).
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e. The rights and remedies in this Section do not exclude any other legal or equitable rights or remedies available to the City.
6. Ownership and Use of Documents The City will own all documents, reports, memoranda, diagrams, sketches, plans, surveys,
design calculations, working drawings and any other materials that the Provider creates or prepares in performing this Agreement (the “Work Products”). The City may use these work products for any lawful purpose. Provider acknowledges that this Agreement and the work products are public records subject to RCW 42.56 unless exempt from public records disclosure requirements. The Provider agrees to fully assist the City in identifying, locating, and copying any records Provider possesses that the City determines in its sole discretion are responsive to a Public Records request. 7. Records Inspection and Audit All City payments are subject to adjustment for any amounts found upon audit or otherwise to have been improperly invoiced. The City may inspect and audit any Provider records and books of account pertaining to any work performed under this Agreement for up to 3 years after the City’s final payment to Provider. If any litigation, claim, dispute, or audit is initiated before this 3 year period expires, Provider shall retain all records and books of
account for any work performed under this Agreement until final resolution of any such litigation, claim, dispute, or audit.
8. Continuation of Performance If any dispute or conflict arises between the parties while this Agreement is in effect, the Provider agrees to cooperate and continue in good faith toward successful completion of
its responsibilities under this Agreement notwithstanding such dispute or conflict. 9. Independent Contractor The Provider will perform the services as an independent contractor, and will not be deemed by virtue of this Agreement or the performance of it to be in a partnership, joint venture, employment, or other relationship with the City. Nothing in this Agreement creates any contract relationship between the City and the Provider’s employees, agents, or subcontractors. 10. Administration of Agreement This Agreement will be administered by Sergey Tarasov, Principal, on behalf of the
Provider, and by the City Mayor (or designee) on behalf of the City. 11. Notices
Notices or communications permitted or required under this Agreement will be written and delivered to the following addresses: Notice to the City: Notice to Provider: Attn: Frank Downard City of Auburn 25 West Main St Auburn WA 98001-4998 Phone: 253.804.5095
Fax: 253.876-1920
Attn: Sergey Tarasov FCS Group 7525 166th Ave NE, Suite D-215 Redmond, WA 98052 Phone: 425.867.1802 ext. 247
Fax: 425.867-1937
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Email: fdownard@auburnwa.gov Email: sergeyt@fcsgroup.com
Either party may change its above address by giving written notice to the other party.
Notices to non-parties will be delivered as designated by a party to this Agreement. 12. Insurance a. The Provider will, at its sole expense, procure and maintain for the duration of this Agreement and for 30 days thereafter insurance against claims for injuries to persons or damage to property which may arise from or in connection with the performance of this Agreement by the Provider, its agents, representatives, or employees. b. Provider’s maintenance of insurance as required by the Agreement will not be construed to limit the liability of the Provider to the coverage provided by such insurance, or otherwise limit the City’s recourse to any remedy available at law or in equity.
c. The Service Provider will obtain insurance of the types described below: (i) Automobile Liability insurance covering all owned, non-owned, hired and
leased vehicles. Coverage will be at least as broad as Insurance Services Office (ISO) form CA 00 01 (provider may use a substitute form providing equivalent liability coverage). Provider will maintain automobile insurance with minimum combined single limit for bodily injury and property damage of $1,000,000 per accident. (ii) Commercial General Liability insurance will be at least as broad as ISO occurrence form CG 00 01 and will cover liability arising from premises, operations, stop-gap independent contractors, products-completed operations, personal injury and advertising injury, and liability assumed under an insured contract. The City will be named as an additional insured under the Provider’s Commercial General Liability insurance policy with respect to the work performed for the City using an additional insured endorsement at least as broad as ISO Additional Insured endorsement CG 20 26.
Commercial General Liability insurance will be written with limits no less than $2,000,000 each occurrence, $2,000,000 general aggregate.
(iii) Worker’s Compensation coverage as required by the Industrial Insurance laws of the State of Washington. (iv) Professional Liability insurance appropriate to the Provider’s profession with limits no less than $2,000,000 per claim and $2,000,000 policy aggregate limit. d. For Automobile Liability and Commercial General Liability insurance, the policies are to contain, or be endorsed to contain that Provider’s insurance coverage will be primary insurance as respects the City. Any insurance, self-insurance, or self-
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insurance pool coverage maintained by the City will be excess of the Provider’s insurance and will not contribute with it.
e. Insurance is to be placed with an authorized insurer in Washington State. The insurer must have a current A.M. Best rating of not less than A:VII.
f. The Provider will furnish the City with original certificates of insurance and a copy of the amendatory endorsements, including but not necessarily limited to the additional insured endorsement, evidencing the insurance requirements of this Agreement before commencement of the work. g. The City reserves the right to require that complete, certified copies of all required insurance policies and/or evidence of all subcontractors’ coverage be submitted to the City at any time. The City may withhold payment if the Provider does not fully comply with this request.
h. If the Provider maintains higher insurance limits than the minimums shown above, the City will be insured for the full available limits of Commercial General and Excess or Umbrella liability maintained by the Provider, irrespective of
whether such limits maintained by the Provider are greater than those required by this Agreement or whether any certificate of insurance furnished to the City evidences limits of liability lower than those maintained by the Provider.
i. The provider will provide the City with written notice of any policy cancellation within two business days of their receipt of such notice. Failure by the Provider to maintain the insurance as required will constitute a material breach of this agreement, upon which the City may, after giving five (5) business days’ notice to the Provider to correct the breach, immediately terminate the agreement or, at its discretion, procure or renew such insurance and pay any and all premiums in connection therewith, with any sums so expended to be repaid to the City on demand, or at the City’s sole discretion, offset against funds due the Provider from the City.
13. Indemnification/Hold Harmless a. Except for injuries and damages caused by the sole negligence of the City, the Provider will defend, indemnify and hold the City and its officers, officials,
employees, and volunteers harmless from any and all claims, injuries, damages, losses, or suits of every kind, including attorney fees and litigation expenses, arising out of or resulting from the acts, errors, or omissions of the Provider, its
employees, agents, representatives, or subcontractors, including employees, agents, or representatives of its subcontractors, made in the performance of this Agreement, or arising out of worker’s compensation, unemployment
compensation, or unemployment disability compensation claims. b. However, should a court of competent jurisdiction determine that this Agreement is subject to RCW 4.24.115, then, in the event of liability for damages arising out of bodily injury to persons or damages to property caused by or resulting from the concurrent negligence of the Provider and the City, its officers, officials,
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employees, and volunteers, the Provider's liability, including the duty and cost to defend, hereunder shall be only to the extent of the Provider’s negligence.
c. If is further specifically and expressly understood that this indemnification constitutes the Provider’s waiver of immunity under Industrial Insurance, Title 51
RCW, solely for the purposes of this indemnification. This waiver has been mutually negotiated by the parties. The provisions of this section will survive the expiration or termination of this Agreement. d. The provisions of this section were separately and mutually negotiated by the parties. 14. Assignment Neither party to this Agreement may partially or wholly assign any right or obligation in it without the other party’s prior written consent. No assignment or transfer of any interest under this Agreement will release the assignor from any liability or obligation under this Agreement, or cause any such liability or obligation to be reduced to a secondary liability or obligation.
15. Nondiscrimination The Provider may not engage in any unfair practice identified in RCW 49.60.180 and/or 42 U.S.C. §2000e-2 in the performance of any services or activities under this Agreement
(either directly or through contractual, hiring, or other arrangements). 16. Amendment, Modification and Waiver
No amendment, modification, or waiver of any condition, provision, or term of this Agreement will be valid or effective unless written and signed by the party to be bound (or the party’s authorized representative), specifying the nature and extent of such amendment, modification or waiver. Any waiver, approval or acceptance, or payment by any party will not affect or impair that party’s rights arising from any default by the other party. 17. Parties in Interest This Agreement will bind (and its benefits and obligations will inure to) the parties and their respective successors and assigns. This section will not permit any transfer or assignment otherwise prohibited by this Agreement. This Agreement is for the exclusive
benefit of the parties and it does not create a contractual relationship with or exist for the benefit of any third party (including contractors, sub-contractors and sureties).
18. Force Majeure Delays in performing this Agreement will be excused to the extent caused by acts outside a party’s control, such as fires, cyber/ransomware attacks, earthquakes, floods,
explosions, actions of the elements, riots, mob violence, strikes, pandemics, labor strikes or lockouts, and state or federal government emergency orders. 19. Applicable Law This Agreement and the rights of the parties under it will be governed by the laws, regulations, and ordinances of the City, King County, and the State of Washington. Venue
for actions involving this agreement will be in the county where the property or project is
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located, or in King County if not site specific. An applicable statute of limitation will commence no later than the Provider’s substantial completion of the services in this
Agreement. 20. Captions, Headings and Titles
All captions, headings or titles in the paragraphs or sections of this Agreement are inserted for convenience of reference only and will not act to limit the scope of their particular paragraph or section. Where appropriate, the singular will include the plural (and vice versa), and masculine, feminine and neuter expressions will be interchangeable. This Agreement has been drafted by mutual agreement of the parties, and it will be interpreted and/or constructed without regard to its drafter. 21. Severable Provisions Each provision of this Agreement is intended to be severable. The illegality or invalidity of any provision in this Agreement will not affect the validity of the Agreement’s remaining provisions. 22. Entire Agreement This Agreement (together with any subsequent amendments or addendums) contains the
entire understanding of the parties regarding its subject matter, and it supersedes all prior oral or written representations, agreements and understandings between the parties. No other oral or written understandings regarding this Agreement shall bind any party.
23. Non-Availability of Funds Every City obligation under this Agreement is contingent on the availability of appropriated
or allocated City funds. If funds required for the City’s performance are not allocated and available, the City may terminate this Agreement at the end of the available funding period and without the required Section 5 seven days’ notice. The City will not be liable if it exercises this provision, and will not be obligated or liable for any future payments or damages as a result of termination under this Section. 24. Counterparts This Agreement may be executed in multiple counterparts, with each counterpart being one and the same Agreement, and the Agreement will become effective when one or more counterparts have been signed by each of the parties and delivered to the other party.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed effective the day and year first set forth above.
CITY OF AUBURN FCS GROUP
_____________________________ Nancy Backus, Mayor Signature
Name:
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Sergey Tarasov
1/30/2024
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Title:
Date: ________________________________ Approved as to form:
_____________________________ Harry Boesche, Acting City Attorney Signature Name:
Title: Date: ________________________________
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1/23/2024
Principal
1/23/2024
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EXHIBIT A SCOPE OF WORK
City of Auburn Utility Financial Plans/Chapters The following scope of services identifies the task Provider will perform in developing the financial programs /chapters for the City’s water, sewer and stormwater comprehensive system plans. Provider will coordinate as necessary with the City’s consulting engineers, Consor North America (water), Carollo Engineers (sewer) and Parametrix (storm).
• Task 1: Data Collection and Validation Provide a data needs list encompassing historical and projected financial, operational and planning information. The provided data will be reviewed, analyzed and validated for inclusion in the study process.
• Task 2: Historical Financial Performance Review Review and document the financial operations (revenue and expenses) and financial condition (assets and liabilities) of each utility for the previous six/ten-year period. Summarize noteworthy financial trends.
• Task 3: Financial Policy Review Review the City’s current fiscal policies for operating and capital reserves, system reinvestment funding, debt management, and debt service coverage and recommend changes if warranted.
• Task 4: Capital Financial Plan Evaluate capital funding options and develop a capital financing plan for the six-year, 10-year and 20-year Capital Improvement Programs (CIP). The analysis will include a forecast of capital funding needs, borrowing requirements, and associated cash flows and cash balances over the study period. Evaluate and recommend an appropriate
balance of funding from cash, SDCs, bonds, low interest loans and/or other available funding sources. Depending upon preliminary results, FCS will work closely with the City to perform sensitivity analyses for alternative scheduling of capital projects in order to
smooth customer rate impacts. The budget provides for up to three (3) scenarios.
• Task 5: Operating Forecast The City’s current utilities operating budgets will be used as the baseline for forecasting ongoing operating and maintenance (O&M) costs, debt service, and other financial
obligations over the six-year, 10-year and 20-year study periods. Incorporate engineering planning growth forecasts and establish economic factors for cost escalation. Integrate additional O&M expenses identified as part of the updated CIP and/or any other changes in operational requirements.
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• Task 6: Revenue Needs Assessment Develop an operating cash flow projection for the six-year, 10-year and 20-year study period integrating fiscal policies, operating forecast and capital financing impacts. Compare forecasted financial requirements against forecasted revenue under existing
rates to determine annual and cumulative revenue adjustments needed to ensure financial sustainability over time.
• Task 7: Rate Forecast & Affordability Test Develop a rate forecast for the six-year and 10-year periods. Apply annual rate adjustments to the City’s existing water rate structures “across-the-board” meaning each rate class and rate charge (fixed and variable) will be adjusted equally. Note: this scope does not include changes to the City’s existing rate structures. The Financial Chapter will
include a narrative discussion of potential rate structure enhancements, if necessary. Perform an affordability test as an indication of a residential customer’s ability to pay the existing and forecasted rates. This includes an analysis and comparison of each system’s existing and forecasted average residential bills to 2.0 percent of the median household income. This test will be conducted for the six-year, 10-year and 20-year study periods.
• Task 8: System Development Charge Update A system development charge (SDC) is a one-time charge imposed as a condition of service on new development or on expanded connection to the system. The charge represents a prorated share of the capital investment made to provide system capacity. The SDC is calculated based on the intent and structure of the Revised Code of Washington (RCW) statute for Water-Wastewater Cities (RCW 35.092.025). In general, each connection shall bear a proportional share of the cost of the system capacity required. This task will focus on updating the City’s existing SDCs for each system. The SDC shall reflect an updated inventory of existing system assets, the most recent approved capital
improvement program costs related to growth and capacity supported by the infrastructure identified as part of the system plan updates.
• Task 9: Review Meetings Six (6) internal review meetings are included to go over assumptions and results of the
financial analysis and SDC update. The meetings are budgeted to be performed remotely through interactive conference calls. This scope does not include a presentation to Council.
Additional meetings and / or presentations can be added on a time and materials basis at the request of the City.
• Task 10: Documentation Craft the draft financial chapter for each utility for City staff review. An electronic copy of the draft financial chapters and Excel-based tables will be provided to the City and / or consulting Engineer to incorporate into the system planning documents. Incorporate requested changes, as appropriate, and submit the final version of the financial chapters.
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Schedule The schedule will be coordinated with the City and its consulting engineers. The City has
indicated a desired completion date of May 2024. The project schedule is based on variety of issues including timeliness of receipt of requested data / information; quality of data; ability to schedule meetings in a timely manner, and the ability of the City to provide policy direction for
the study to move forward at key milestones. Assuming the project will commence January 2024 and the final capital improvement program (CIP) will be provided at least 30 days prior to the desired completion date, we believe we can meet the City’s timeline.
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EXHIBIT B
$ 250 225$ 155$ 95$ Task 1 | Data collection & validation 3 6 6 15 2,175$
Task 2 | Historical financial performance review 3 12 30 45 8,100
Task 3 | Financial policy review 0 -
Task 4 | Capital financial plan 3 12 30 45 8,100
Task 5 | Operating forecast 3 12 30 45 8,100
Task 6 | Revenue needs assessment 3 12 42 57 9,960
Task 7 | Rate forecast & affordability test 3 3 12 18 3,285
Task 8 | System development charge update 6 24 56 86 15,580
Task 9 | Review meetings 6 6 6 18 3,780 Task 10 | Documentation 12 12 60 84 15,000 TOTAL BUDGET 39 96 272 6 413 74,080$
Note : Task 3 will utilize the financial policies established in the 2022 rate study.
Total
BudgetTASKPrincipalProject
Manager Analyst Admin Total Hours
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