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R-02-03-14-13D3 - 3/14/2002RESOLUTION NO. R- 02- 03- 14 -13D3 WHEREAS, the City of Round Rock desires to retain professional construction auditing services for the revision of engineering, consulting, architectural, and construction contract agreements, and WHEREAS, Jefferson Wells International has submitted a Proposal for Construction Auditing Services to provide said services, and WHEREAS, the City Council desires to approve said proposal, Now Therefore BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS, That the Mayor is hereby authorized and directed to execute on behalf of the City a Proposal for Construction Auditing Services with Jefferson Wells International for the revision of engineering, consulting, architectural, and construction contract agreements, a copy of said proposal being attached hereto as Exhibit "A" and incorporated herein for all purposes. The City Council hereby finds and declares that written notice of the date, hour, place and subject of the meeting at which this Resolution was adopted was posted and that such meeting was open to the public as required by law at all times during which this Resolution and the subject matter hereof were discussed, considered and formally acted upon, all as required by the Open Meetings Act, Chapter 551, Texas Government Code, as amended. ODMA\ WORLDOX\ O : \W➢OX \RESOLUTI \R203140 3.WPD /sc AT sS RESOLVED this 14th day of March, 2002. CHRISTINE R. MARTINEZ, City Secretar 2 of Round Rock, Texas 1 1 EXHIBIT $ " JEFFERSONWELLS INTERNATIONAL City of Round Rock Department of Public Works Proposal for Construction Auditing Services Contract Review March 1, 2002 Submitted by Jefferson Wells International 100 Congress Avenue, Suite 1520 Austin, Texas 78701 Jefferson Wells International Contact: Mike Linam Business Development Manager Phone: (512) 691 -6412 Fax: (512) 691 -6401 E -Mail: mike_linam @jeffersonwells.com March 1, 2002 Mr. Jim Nuse Director of Public Works City of Round Rock Public Works Department 2008 Enterprise Drive Round Rock, TX 78664 Dear Jim: Jefferson Wells International ( "Jefferson Wells ") appreciates the opportunity to present the City of Round Rock, ( "The City ") with a proposal for professional services. This proposal is subject to the Jefferson Wells Master Service Agreement signed on December 6, 2001. This proposal must be signed, dated and returned to Jefferson Wells at your earliest convenience. Business Issue The City of Round Rock, Public Works Department, regularly issues contracts for professional services and construction projects. Although the standard contracts being utilized have been in use for several years and provide a measure of protection for the City, it may be possible to improve the contracts to add additional protection. It is also possible that improvements to the cost control and verification procedures can be made. The City would like a firm experienced in analyzing and verifying architectural, engineering and construction contracts to review selected contracts and offer recommendations for improvement. The City recognizes this review would not preclude or eliminate the need for a review of these contracts by an attorney with expertise in design and construction contracts. The City considers the review of the financial terms and conditions and the suggestions for improving cost control and verification a pre- cursor to the attorney's efforts. Thus, the two reviews are complementary. Jefferson Wells Solution Jefferson Wells, having been previously engaged to review the management and related controls of the Public Works Department, has encountered several examples of the contracts currently in use, and is, therefore, familiar with the contracts and having the benefit of the previous work, is positioned to expeditiously complete this work. Jefferson Wells routinely reviews design contracts, architectural and engineering projects and construction projects and provides verification and control recommendations to its clients. In discussing this topic, we learned there are four (4) general contract types constituting the majority of the work needed. These contracts are for design and engineering services by architects and consulting engineers and construction services by construction contractors. Based on these discussions and our knowledge of the existing documents and our experience in performing similar engagements, we expect to be able to complete this work in approximately 68 hours with the bulk of that time provided by our Engagement Manager. Our Director of Construction Services would be involved, but we expect his time contribution to be 15 or fewer Position Rate Engagement Manager $130 per hour Director $140 per hour hours of the total 68 -hour engagement. In addition, we anticipate up to 18 hours of travel time (3 round trips) which will be charged at one half the standard Engagement Manager rate. Engagement Management, Staffing and Deliverables We expect to assign an Engagement Manager to the contract evaluation and analysis. For continuity with the previous engagement, we expect this will be Bryan Guidry. Bob McDonald, Director Construction Services, will provide the secondary review and quality control function. The deliverables for this project are the contracts in electronic format annotated with our comments and recommendations and a brief summary report. For this engagement, the work papers and the electronic versions of the contract with our notations are one in the same. Pr Jefferson Wells is pleased to offer a customized, quality solution. Our pricing is based on the complexity of the engagement and the technical skills required and are as follows: Based upon the information stated above, we anticipate our fees for this engagement will not exceed $10,500 including services and expenses. Since the nature of this engagement does not necessitate an on -site presence (assuming we are able to gather all the information needed electronically), our expenses should be minimal. We anticipate two or less onsite visits by our Engagement Manager with no overnight stays involved. Jefferson Wells charges no premium for overtime hours. Our Construction Audit professionals generally work a minimum of 45 hours per week. Travel time will be billed at one -half the standard rate. All reasonable travel and commuting expenses will be invoiced at actual cost. Jefferson Wells will make every effort to keep these expenses to a minimum. Payment Terms Jefferson Wells invoices are sent bi- weekly and are due 15 days from the invoice date. Your cooperation in ensuring these terms are met will enable us to continue to provide you with the best value in the marketplace. We also believe consistent and timely invoicing helps our customers closely track costs accumulating on their projects for optimal internal project management. Benefits of Using Jefferson Wells A customized Jefferson Wells solution delivers many benefits to the City including: • NO CONFLICT OF INTEREST: Avoiding any conflict of interest issues that may arise from using your external audit firm to perform internal audit or internal engagements (Statement of Internal Auditing Standards No.18, December 1997, Section 220.5 -.7 and Revisions of the Commission's Auditor Independence Requirements, November 21, 2000, effective February 5, 2001.) • EXPERIENCE: Utilizing professionals with relevant Construction Services experience. • DEDICATION: Gaining professional staff members dedicated to the City exclusively during this engagement. • CONFIDENTIALITY: Jefferson Wells will maintain the confidentiality of all information disclosed to Jefferson Wells by the City. Other Provisions • In recognition of your changing and evolving environment, this engagement can be cancelled at any time for any reason. • As our customer, all documents and reports belong to you. • Jefferson Wells is not a public accounting firm and does not provide attest services or otherwise report on financial statements. The procedures we perform and the products we create will be under the direction of the City and are intended for internal use. • This proposal expires sixty days from the proposal date, unless signed. We at Jefferson Wells appreciate the opportunity to provide the City with this proposal for professional services. If you approve of its contents, we are committed to earning your loyalty by providing excellent operating solutions and delivering added value, high quality services in support of the City. We are available to answer any questions you may have or to meet with you to further discuss the details of the engagement. We look forward to working with you on this engagement. Sincerely, Mike Linam Business Development Manager Please indicate your acceptance of this proposal by signing and returning this document to me. You may fax it to (512) 691 -6401, if you wish. Proposal accepted by: Date: DATE: March 8, 2002 SUBJECT: City Council Meeting — March 14, 2002 ITEM: 13.D.3. Consider a resolution authorizing the Mayor to execute a Proposal for Construction Auditing Services with Jefferson Wells International for the revision of engineering, consulting, architectural, and construction contract agreements. Resource: Jim Nuse, Public Works Director History: With nearly $180 million worth of projects to be completed by the City within the next five years, Jefferson Wells International evaluated our project management processes. After reviewing their draft audit report, the staff recommends that we need to revise the City's contracts and agreements for both professional services as well as construction contracts. Funding: Cost: On an hourly basis not to exceed $ 10,500. Source of funds: 2000 CO Interest Outside Resources: Jefferson Wells Impact/ Benefit: This process will help improve the value of our construction projects. Public Comment: N/A 1 1 1 1 1 1 1 1 1 1 1 1 1 1 JEFFERSONWELLS INTERNATIONAL City of Round Rock Department of Public Works Proposal for Construction Auditing Services Contract Review March 1, 2002 Submitted by Jefferson Wells International 100 Congress Avenue, Suite 1520 Austin, Texas 78701 Jefferson Wells International Contact: Mike Linam Business Development Manager Phone: (512) 691 -6412 Fax: (512) 691 -6401 E -Mail: mike_linam @jeffersonwells.com March 1, 2002 Mr. Jim Nuse Director of Public Works City of Round Rock Public Works Department 2008 Enterprise Drive Round Rock, TX 78664 Dear Jim: Jefferson Wells International ( "Jefferson Wells ") appreciates the opportunity to present the City of Round Rock, ( "The City") with a proposal for professional services. This proposal is subject to the Jefferson Wells Master Service Agreement signed on December 6, 2001. This proposal must be signed, dated and returned to Jefferson Wells at your earliest convenience. Business Issue The City of Round Rock, Public Works Department, regularly issues contracts for professional services and construction projects. Although the standard contracts being utilized have been in use for several years and provide a measure of protection for the City, it may be possible to improve the contracts to add additional protection. It is also possible that improvements to the cost control and verification procedures can be made. The City would like a firm experienced in analyzing and verifying architectural, engineering and construction contracts to review selected contracts and offer recommendations for improvement. The City recognizes this review would not preclude or eliminate the need for a review of these contracts by an attorney with expertise in design and construction contracts. The City considers the review of the financial terms and conditions and the suggestions for improving cost control and verification a pre- cursor to the attorney's efforts. Thus, the two reviews are complementary. Jefferson Wells Solution Jefferson Wells, having been previously engaged to review the management and related controls of the Public Works Department, has encountered several examples of the contracts currently in use, and is, therefore, familiar with the contracts and having the benefit of the previous work, is positioned to expeditiously complete this work. Jefferson Wells routinely reviews design contracts, architectural and engineering projects and construction projects and provides verification and control recommendations to its clients. In discussing this topic, we learned there are four (4) general contract types constituting the majority of the work needed. These contracts are for design and engineering services by architects and consulting engineers and construction services by construction contractors. Based on these discussions and our knowledge of the existing documents and our experience in performing similar engagements, we expect to be able to complete this work in approximately 68 hours with the bulk of that time provided by our Engagement Manager Our Director of Construction Services would be involved, but we expect his time contribution to be 15 or fewer Position Rate Engagement Manager $130 per hour Director $140 per hour 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 Benefits of Using Jefferson Wells 1 1 1 hours of the total 68 -hour engagement. In addition, we anticipate up to 18 hours of travel time (3 round trips) which will be charged at one half the standard Engagement Manager rate. Engagement Management, Staffing and Deliverables We expect to assign an Engagement Manager to the contract evaluation and analysis. For continuity with the previous engagement, we expect this will be Bryan Guidry. Bob McDonald, Director Construction Services, will provide the secondary review and quality control function. The deliverables for this project are the contracts in electronic format annotated with our comments and recommendations and a brief summary report. For this engagement, the work papers and the electronic versions of the contract with our notations are one in the same. Pricing Jefferson Wells is pleased to offer a customized, quality solution. Our pricing is based on the complexity of the engagement and the technical skills required and are as follows: Based upon the information stated above, we anticipate our fees for this engagement will not exceed 810,500 including services and expenses. Since the nature of this engagement does not necessitate an on -site presence (assuming we are able to gather all the information needed electronically), our expenses should be minimal. We anticipate two or less onsite visits by our Engagement Manager with no overnight stays involved. Jefferson Wells charges no premium for overtime hours. Our Construction Audit professionals generally work a minimum of 45 hours per week. Travel time will be billed at one -half the standard rate. All reasonable travel and commuting expenses will be invoiced at actual cost. Jefferson Wells will make every effort to keep these expenses to a minimum. Payment Terms Jefferson Wells invoices are sent bi- weekly and are due 15 days from the invoice date. Your cooperation in ensuring these terms are met will enable us to continue to provide you with the best value in the marketplace. We also believe consistent and timely invoicing helps our customers closely track costs accumulating on their projects for optimal internal project management. A customized Jefferson Wells solution delivers many benefits to the City including: • NO CONFLICT OF INTEREST: Avoiding any conflict of interest issues that may arise from using your external audit firm to perform internal audit or internal engagements (Statement of Internal Auditing Standards No.18, December 1997, Section 220.5 -.7 and Revisions of the Commission's Auditor Independence Requirements, November 21, 2000, effective February 5, 2001.) • EXPERIENCE: Utilizing professionals with relevant Construction Services experience. • DEDICATION: Gaining professional staff members dedicated to the City exclusively during this engagement. • CONFIDENTIALITY: Jefferson Wells will maintain the confidentiality of all information disclosed to Jefferson Wells by the City. Other Provisions • In recognition of your changing and evolving environment, this engagement can be cancelled at any time for any reason. • As our customer, all documents and reports belong to you. • Jefferson Wells is not a public accounting firm and does not provide attest services or otherwise report on financial statements. The procedures we perform and the products we create will be under the direction of the City and are intended for internal use. • This proposal expires sixty days from the proposal date, unless signed. We at Jefferson Wells appreciate the opportunity to provide the City with this proposal for professional services. If you approve of its contents, we are committed to earning your loyalty by providing excellent operating solutions and delivering added value, high quality services in support of the City. We are available to answer any questions you may have or to meet with you to further discuss the details of the engagement. We look forward to working with you on this engagement. Sincerely, Mike Linam Business Development Manager Please indicate your acceptance of this proposal by signing and returning this document to me. You may fax it to (512) 69 -6401, if you wish. Proposal accepted by: CITY OF ROUND ROCK -y NiN /1 Mayor Robert A. Sdaka, Jr. Mayor Pro-tem Tom Nielson Council Members Alan McCraw- Carrie Pitt Earl Palmer Isabel Callahan Cary Coe City Manager RobertL Bennett, Jr. City Attorney Stephan L Sheers March 19, 2002 Mr. Mike Linam Business Development Manager Jefferson Wells International 100 Congress Avenue, Suite 1520 Austin, TX 78701 Dear Mr. Linam: The Round Rock City Council approved Resolution No. R-02-03-14-13D3 at their regularly scheduled meeting on March 14, 2002. This resolution approves the proposal for Construction Auditing Services. Enclosed is a copy of resolution and the proposal for your files. If you have any questions, please do not hesitate to contact Jim Nuse at 218 -5560. Sincerely, Christine R. Martinez City Secretary Enclosure Fax: 512- 218 -7097 1.800- 735 -2989 TDD 1 -800- 735 -2988 Voice www.ci.round-rocklx.us