HomeMy WebLinkAboutStaff Report 12106
City of Palo Alto (ID # 12106)
City Council Staff Report
Report Type: Consent Calendar Meeting Date: 4/12/2021
City of Palo Alto Page 1
Summary Title: Financial Audit Contract Extension
Title: Approval of Amendment Number 2 to Contract Number CC16161769
With Macias, Gini, & O'Connell for External Audit Services, to Extend the
Term for one Year and add $175,000, for a new Total Not -to-Exceed Amount
of $1,050,569
From: City Manager
Lead Department: City Auditor
Recommended Motion
The City Auditor recommends approval of amendment no. 2 to Contract No. C16161769 with
the accounting firm of Macias, Gini & O’Connell LLP (MGO), for external finan cial audit services,
to extend the term of the contract by one additional year, ending February 28, 2022, and to
increase the total maximum compensation by $175,000.00, from $875,569 to $1,050,569
(Attachment A).
Discussion
The City Charter requires the City Council, through the City Auditor, to engage an independent
certified public accounting firm to conduct the annual financial audit, and report the results of
the audit, in writing, to the City Council. The City’s original contract with MGO included the
provision of external audit services through January 21, 2021 and was approved by the City
Council on April 4, 2016 (Staff Report). Contract amendment no. 1, approved and executed by
the City Manager per PAMC 2.30.290 (b), extended the contract term by six months, through
July 21, 2021, at no added cost to the City (Attachment B). Contract amendment no. 2 will
extend the contract term through February 28, 2022, and add $175,000 to the not-to-exceed
amount, for a new total not to exceed $1,050,569. Contract amendment no. 2 will enable the
provision of external auditing services to cover the City’s fiscal year ending June 30, 2021.
Due to extraordinary circumstances caused by the COVID-19 pandemic and the timing and
selection of a new service delivery for the City Auditor role, the City Auditor and City staff
expect that going out to a new competitive solicitation is impractical at this time. If a new
provider were to be awarded the contract, engaging a new financial audit firm would cause
significant logistical challenges for City staff under the current circumstances. The first year of a
new audit engagement requires significant interaction with and education of the new fin ancial
City of Palo Alto Page 2
audit team to understand the City's finances and accounting practices. Due to the current
remote work environment, critical vacancies in the City’s accounting team (most notably the
Finance Manager), and the expectation that remote work will be on-going when preliminary
audit work is expected to begin (April/May), the added effort involved in on-boarding new audit
staff would exacerbate already challenging circumstances.
According to Section 2.30.360(b)(2) of the Palo Alto Municipal Code (PAMC), an exemption
from competitive solicitation applies to situations where solicitation would be “impracticable,
unavailing or impossible ... [or] not be useful or produce any operational or financial advantage
for the city”. As above, a competitive solicitation at this time would cause significant challenges
under the current circumstances, sufficient to render such solicitation “impracticable” and
“unavailing,” as well as being without “operational advantage” for the city.
Under the circumstances, and in accordance with PAMC, the City Auditor initiated a request for
exemption from competitive solicitation with the Chief Procurement Officer and City Manager,
which was approved. Staff expects to conduct a request to proposal solicitation during this
extension and award a new contract for service based on that public process prior to the sunset
of this extension.
Given the above, the City Auditor recommends that the City Council authorize this amendment
no. 2 to the MGO contract to extend the current contr act term by one year, ending February
28, 2022 (for audit of the financial statements for the fiscal year ending June 30, 2021 ), and to
increase the total maximum compensation by $175,000 from $875,569 to $1,050,569 .
Additional note: California Government Code Section 12410.6 (b) states that a local agency shall
not employ a firm to provide audit services if the lead audit partner or coordinating audit
partner having primary responsibility for the audit, or the audit partner responsible for
reviewing the audit, has performed audit services for six consecutive fiscal years. In the case of
the current financial auditors, the lead audit partner has transitioned in the appropriate time
period such that the current team may, consistent with Government Code Section 12410.6 (b),
perform an audit of the financial statements for the fiscal year ending June 30, 2021 .
For reference, amendment no. 1 to this contract extending the contract for a six -month term to
complete the FY 2020 Single Audit of Federally Funded P rograms is Attachment B. The total
not-to-exceed compensation was not increased in amendment no. 1, which was approved and
executed by the City Manager per PAMC 2.30.290 (b). The original City Council approval can be
found here: https://www.cityofpaloalto.org/civicax/filebank/documents/51628 after a formal
Request for Proposal (RFP) and competitive procurement process.
Resource Impact
This contract amendment no. 2 increases total maximum compensation of the existing contract
by $175,000. That figure is comprised of two components. First, to perform the same
procedures as have been performed in prior years, audit fees total $163,725, which is inclusive
City of Palo Alto Page 3
of a $10,000 discount offered by MGO.
The second component of the total increase to compensation is included in the anticipation of
the need to perform audit procedures over a second major program under the Single Audit.
Note that definition of a major program lies in the a mount of funding received by the City
through Federal grants, and is not determined by the actions of the City itself.
Funding for this contract amendment no. 2 is subject to City Council approval through the
annual budget process.
Environmental Impact
The action recommended is not a project for the purposes of the California Environmental
Quality Act.
Attachments:
• Attachment A - Amendment No. 2 to Contract No. C16161769 with Macias Gini &
O'Connell LLP
• Attachment B - Amendment No. 1 to Contract No. C16161769 with Macias Gini &
O'Connell
Page 1 of 15
AMENDMENT NO. 2 TO CONTRACT NO. C16161769
BETWEEN THE CITY OF PALO ALTO AND
MACIAS GINI & O’CONNELL LLP
This Amendment No. 2 (this “Amendment”) to Contract No. C16161769 (the “Contract” as
defined below) is entered into as of April 5, 2021, by and between the CITY OF PALO ALTO, a
California chartered municipal corporation (“CITY”), and MACIAS GINI & O’CONNELL LLP, a
limited liability partnership, located at 2121 N. California Blvd., Suite 750, Walnut Creek,
California, 94596 (“CONSULTANT”). CITY and CONSULTANT are referred to collectively as
the “Parties” in this Amendment.
R E C I T A L S
A. The Contract (as defined below) was entered into by and between the Parties hereto for
the provision of external auditing services, as detailed therein.
B. The Parties now wish to amend the Contract in order to extend the term, and to
increase the total maximum compensation by $175,000.00 from $875,569.00 to
$1,050,569.00, as detailed herein.
NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of
this Amendment, the Parties agree:
SECTION 1. Definitions. The following definitions shall apply to this Amendment:
a. Contract. The term “Contract” shall mean Contract No. C16161769
between CONSULTANT and CITY, dated April 11, 2016, as amended by:
Amendment No.1, dated January 15, 2021
b. Other Terms. Capitalized terms used and not defined in this
Amendment shall have the meanings assigned to such terms in the
Contract.
SECTION 2. Section 2, “TERM,” of the Contract is hereby amended to read as follows:
“SECTION 2. TERM. The term of this Agreement shall be from the date of its
full execution through February 28, 2022, unless terminated earlier pursuant
to Section 19 of this Agreement.”
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SECTION 3. Section 4, “NOT TO EXCEED COMPENSATION,” of the Contract is hereby
amended to read as follows:
“SECTION 4. NOT TO EXCEED COMPENSATION. The compensation to be paid to
CONSULTANT for performance of the Services described in Exhibit “A,” including
both payment for professional services and reimbursable expenses, shall not
exceed per year as follows:
2016 – 2017 $149,925.00
2017 – 2018 $154,423.00
2018 – 2019 $159,055.00
2019 – 2020 $163,827.00
2020 – 2021 $168,742.00
2021 – 2022 $163,725.00
Total compensation for services and reimbursable expenses shall not exceed
Nine Hundred Fifty Nine Thousand Six Hundred Ninety Seven Dollars
($959,697.00). In the event Additional Services are authorized, the total
compensation for Services, Additional Services, and reimbursable expenses shall
not exceed One Million Fifty Thousand Five Hundred Sixty Nine Dollars
($1,050,569.00). The applicable rates and schedule of payment are set out at
Exhibit “C-1,” entitled “HOURLY RATE SCHEDULE,” which is attached to and
made a part of this Agreement.
Additional Services, if any, shall be authorized in accordance with and subject to
the provisions of Exhibit “C.” CONSULTANT shall not receive any compensation
for Additional Services performed without the prior written authorization of
CITY. Additional Services shall mean any work that is determined by CITY to be
necessary for the proper completion of the Project, but which is not included
within the Scope of Services described at Exhibit “A.””
SECTION 4. The following exhibit(s) to the Contract is/are hereby amended or added, as
indicated below, to read as set forth in the attachment(s) to this Amendment, which is/are
hereby incorporated in full into this Amendment and into the Contract by this reference:
a. Exhibit “A” entitled “SCOPE OF SERVICES”, AMENDED, REPLACES PREVIOUS.
b. Exhibit “B” entitled “SCHEDULE OF PERFORMANCE”, AMENDED, REPLACES
PREVIOUS.
c. Exhibit “C” entitled “COMPENSATION”, AMENDED, REPLACES PREVIOUS.
d. Exhibit “C-1” entitled “HOURLY RATE SCHEDULE”, AMENDED, REPLACES
PREVIOUS.
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SECTION 5. Legal Effect. Except as modified by this Amendment, all other provisions of the
Contract, including any exhibits thereto, shall remain in full force and effect.
SECTION 6. Incorporation of Recitals. The recitals set forth above are terms of this
Amendment and are fully incorporated herein by this reference.
SIGNATURES OF THE PARTIES
IN WITNESS WHEREOF, the Parties have by their duly authorized representatives
executed this Amendment effective as of the date first above written.
CITY OF PALO ALTO
City Manager
APPROVED AS TO FORM:
City Attorney or designee
MACIAS GINI & O’CONNELL LLP
By:
Name:
Title:
Attachments:
EXHIBIT “A”: SCOPE OF SERVICES (AMENDED, REPLACES PREVIOUS)
EXHIBIT “B”: SCHEDULE OF PERFORMANCE (AMENDED, REPLACES PREVIOUS)
EXHIBIT “C”: COMPENSATION (AMENDED, REPLACES PREVIOUS)
EXHIBIT “C-1”: HOURLY RATE SCHEDULE (AMENDED, REPLACES PREVIOUS)
DocuSign Envelope ID: D3FABAE8-5237-4792-8824-CD62C686D88C
Partner
David Bullock
Page 4 of 15
EXHIBIT “A”
SCOPE OF SERVICES, AMENDMENT NO. 2
(AMENDED, REPLACES PREVIOUS)
CONSULTANT to provide Auditing Services per the following:
PROJECT SPECIFICATIONS
Unless otherwise noted, all audit services cover the City's fiscal years ending on June 30,
2016, through June 30, 2021. The audit services are to be performed in accordance with
generally accepted auditing standards; the standards for financial audits set forth in the
United States Government Accountability Office's Government Auditing Standards (2011
revision, or subsequent revisions); the provisions of the federal Single Audit Act of 1984, as
amended in 1996; and the United States Office of Management and Budget Circular A-133,
Audits of States, Local Governments, and Non-Profit Organizations.
Generally accepted accounting principles provide for certain required supplementary
information, such as Management's Discussion and Analysis to accompany the City's basic
financial statements. CONSULTANT shall apply certain limited procedures consisting
principally of inquiries of management regarding the methods of measurement and
presentation, which the City shall affirm to the CONSULTANT in the City's Management
Letter. Please note that all dates cited will be confirmed each year during the entrance
conference.
Basic Audit Services Required
CONSULTANT shall audit the City's financial statements and prepare the City's federal and
state tax returns for the Palo Alto Public Improvement Corporation for the fiscal years
ending on June 30, 2016, through June 30, 2021. In providing these services, CONSULTANT
shall:
A. Prior to year-end, and preferably during March and April, the CONSULTANT shall
perform interim work to test the internal controls of accounting processes.
Deliverables:
1) No later than the last working day in May of each year, provide the City Auditor
and the Director of Administrative Services with a draft management letter of the
issues identified.
2) Within three weeks after receiving the City’s response to any issues in the draft
management letter (the Accounting Division in the Administrative Services
Department will respond in a written memo), provide written comments to the
response to the City Auditor and the Director of Administrative Services.
B. Use the City’s worksheet and template to prepare the Comprehensive Annual Financial
Report (Annual Report), including the entity wide statements. The Annual Report
should be prepared in the format recommended by the Government Finance Officers
Association, in accordance with City standards, and with website-compatibility.
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NOTE: The City of Palo Alto may transition during the contract period to preparing the Annual
Report itself. If it does, this item would no longer be a required service, and the contract price
would be adjusted accordingly.
Deliverables:
1) No later than the fifteenth (15th) day of November of each year, provide the electronic
data used to prepare the Annual Report to the Administrative Services Department.
C. Audit the basic financial statements and supplementary entity-wide combining and individual
fund financial statements included in the City's Annual Report, including all funds under the
jurisdiction and control of the City, and render a professional opinion thereon.
Deliverables:
1) No later than the 15th day in November of each year, provide a complete electronic version
of the Comprehensive Annual Financial Report, including the opinion letter and the Single
Audit Report, in a website-compatible format, to the City Auditor and the Director of
Administrative Services.
2) No later than the fifteenth (15th) day of November of each year, provide fifteen (15) color
and ten (10) black and white bound copies of the Comprehensive Annual Financial Report,
including the opinion letter and the Single Audit Report, to the City Auditor.
D. Audit the City's federal financial assistance program and issue reports thereon in accordance
with the provisions of the Single Audit Act of 1984, including the 1996 amendments to the
Single Audit Act, and any other amendments which become effective during the term of this
contract.
Deliverables:
1) See deliverables under Item C above.
E. Prepare a management letter to the City Council that includes observations and
recommendations identified during the audit. This may include:
• issues regarding internal control structure (e.g., information systems, functions, and
procedures)
• items concerning compliance with laws, rules, and regulations
• opportunities for economies and efficiencies inherent in the accounting functions or
reporting activities of the City
• other matters of interest to the City Council and management
Deliverables:
1) One week after completing field work each year, provide a draft management letter for
completed field work to the City Auditor and the Director of Administrative Services.
2) No later than the fifteenth (15th) day of November of each year, provide the final
comprehensive management letter to the City Auditor and the Director of Administrative
Services.
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F. Audit the financial statements of the Regional Water Quality Control (RWQC) Plant and issue a
report thereon in accordance with the requirements in the "Basic Agreement between the
Cities of Palo Alto, Mountain View, and Los Altos for Acquisition, Construction, and
Maintenance of a Joint Sewer System," and all addenda thereto.
Deliverables:
1) No later than the last working day in October of each year, provide an electronic copy of
the draft RWQC report to the City Auditor and the Director of Administrative Services.
2) No later than the fifteenth (15th) day of November of each year, provide an electronic copy
of the final RWQC report to the City Auditor and the Director of Administrative Services.
G. Audit and issue a report on the financial statements of the Palo Alto Public Improvement
Corporation, which the City has created to finance construction of specific facilities and prepare
their applicable federal and state informational and tax returns.
Deliverables:
1) No later than the last working day in October of each year, provide an electronic copy of the
draft Public Improvement Corporation report to the City Auditor and the Director of
Administrative Services.
2) No later than the last working day of November of each year, provide an electronic copy of
the final Public Improvement Corporation report to the City Auditor and the Director of
Administrative Services.
3) No later than the fifteenth (15th) day of February of each year, provide an electronic copy
of the federal and state tax returns to the City Auditor and the Director of Administrative
Services.
H. Audit the City's state financial assistance program (Transportation Development Act) and issue
reports thereon in accordance with applicable state requirements.
Deliverables:
1) No later than the last working day in October of each year, provide an electronic copy of the
draft financial assistance program report to the City Auditor and the Director of
Administrative Services.
2) No later than the fifteenth (15th) day of November of each year, provide an electronic copy
of the final financial assistance program report to the City Auditor and the Director of
Administrative Services.
I. Perform agreed-upon procedures on the Gann Limit calculation and prepare a letter certifying
compliance, as required.
Deliverables:
1) No later than the last working day in May of each year, provide an electronic copy of the
Gann Limit letter to the City Auditor and the Director of Administrative Services.
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J. Audit the statements of, and issue a report thereon, cable television franchise receipts and
disbursements, for the current period, relating to the Joint Operating Agreement signed on
October 13, 1988, by and among the City of Palo Alto, Town of Atherton, City of Menlo Park,
City of East Palo Alto, County of San Mateo, and County of Santa Clara.
Deliverables:
1) No later than the fifteenth (15th) day of November of each year, provide an electronic
copy of the cable report to the City Auditor and the Director of Administrative Services.
K. Prepare the Annual Financial Transactions Report and Annual Street Report in accordance with
instructions from the California State Controller’s Office.
NOTE: The City of Palo Alto may transition during the contract period to preparing these reports
itself. If it does, this item would no longer be a required service, and the contract price would be
adjusted accordingly.
Deliverables:
1) No later than the second Friday in September of each year, provide an electronic copy of
the Annual Street Report to the Director of Administrative Services for signature and
mailing, with a courtesy copy to the City Auditor.
2) No later than the fifteenth (15th) day of October of each year, provide an electronic copy of
the Annual Financial Transactions Report to the Director of Administrative Services for
signature and mailing, with a courtesy copy to the City Auditor.
L. Audit and issue a report on the financial statements of the Palo Alto Library Bond Fund, and
perform agreed-upon procedures on the Library Bond Fund and issue a report of compliance as
required.
NOTE: We are anticipating that activity in this fund will cease at some point during the contract
period. If it does, this item would no longer be a required service, and the contract price will be
adjusted accordingly.
Deliverables:
1) No later than the last working day in October of each year, provide an electronic copy of
the library bond report to the City Auditor and the Director of Administrative Services.
2) No later than the fifteenth (15th) day of November of each year, provide an electronic copy
of the library bond report of compliance to the City Auditor and the Director of
Administrative Services.
M. CONSULTANT is required to attend the following meetings, at no additional cost, during each
audit engagement period:
• Entrance Conference – Prior to conducting interim work, CONSULTANT shall meet with the
City Auditor and the Director of Administrative Services or their designees, to establish
timelines for completing required tasks.
• CONSULTANT shall meet regularly with the City Auditor and the Assistant Director of
Administrative Services or their designees to report on the progress of CONSULTANT’S
examinations and on the preliminary audit findings and recommendations.
Page 8 of 15
• CONSULTANT shall meet with the City Auditor or designee independently to review internal
control issues identified during the audit. This will include reportable conditions, if
applicable, reflected in the draft management letter.
• CONSULTANT shall hold an exit conference with the City Auditor, Director of Administrative
Services, and appropriate staff upon completion of the audit. CONSULTANT will present the
financial statements and draft management letter at this meeting.
• CONSULTANT shall attend a Council Finance Committee meeting to present and discuss the
audit results and the management letter.
N. Provide training for City staff, at no additional cost, regarding important industry developments
and technical matters:
• Proactive guidance on complying with any GASB pronouncements and/or other
requirements that may significantly impact the City’s financial reporting over the next
several years.
• Provide formal training regarding industry developments and new accounting regulations.
O. Assist the City in the transition to comply with any new Governmental Accounting Standards
Board (GASB) pronouncements. To the extent possible, this assistance should be provided
during the interim work, and may include reviewing reports, transactions, and Management
Discussion and Analysis.
P. CONSULTANT will provide to the City Auditor and Director of Administrative Services or
designee, at no additional cost, any publications produced by CONSULTANT, the American
Institute of Certified Public Accountants (AICPA), the Financial Accounting Standards Board
(FASB), the GASB, the Government Finance Officers Association (GFOA), and the United States
Government Accountability Office (GAO). Examples of these publications include:
• AICPA Professional Standards
• AICPA State and Local Governments – Audit and Accounting Guide
• FASB Accounting Standards
• GASB Codifications of Governmental Accounting and Financial Reporting Standards
• GFOA publications related to governmental accounting, auditing and financial reporting
• GAO’s Government Auditing Standards
ASSISTANCE TO BE PROVIDED TO CONSULTANT AND REPORT PREPARATION
Administrative Services Department (ASD) and Clerical Assistance
ASD staff and responsible management will be available during the audit to assist the firm by
providing information, documentation and explanations. ASD staff will prepare statements and
schedules for CONSULTANT as requested.
Report editing and compilation shall be the responsibility of CONSULTANT. ASD staff will print
copies, as needed, of the electronic reports provided by CONSULTANT.
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Work Area, Photocopying, and Parking
The City will provide CONSULTANT with reasonable workspace and access to a copying
machine/scanner and parking for CONSULTANT’S staff, taking into consideration the on-going
pandemic and safety restrictions.
TIME REQUIREMENTS
Audit schedule (exact dates to be confirmed at the entrance conference each year):
Interim Work Completed: May 31 – for subsequent years, it is anticipated that draft
management letter interim work be completed in March and April
Field Work Completed: October 15
Initial Draft Report: November 1
Final Report: November 15
Presentation of Audit Results: Third Tuesday in November to Finance Committee
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EXHIBIT “B”
SCHEDULE OF PERFORMANCE, AMENDMENT NO. 2
(AMENDED, REPLACES PREVIOUS)
CONSULTANT shall perform the Services so as to complete each milestone by the dates specified
below. The time to complete each milestone may be increased or decreased by mutual written
agreement of the project managers for CONSULTANT and CITY so long as all work is completed
within the term of the Agreement. See also the “Time Requirements” section of Exhibit A (Scope of
Services).
For fiscal years 2015–2016 through 2020–2021, CONSULTANT’s schedule of performance is as
follows:
(CONTINUED ON THE NEXT PAGE.)
Page 11 of 15
For fiscal year 2021–2022, CONSULTANT’s schedule of performance is as follows:
AUDIT TIMELINE - CITY OF PALO ALTO
Planning
Client expectations meeting Upon execution of contract
Perform planning procedures 4/19/2021 - 4/30/2021
Interim Fieldwork
On-site interim fieldwork 5/3/2021 - 5/21/2021
Report interim management letter and provide the client participation schedule for year-end 6/4/2021
Year End Fieldwork
Obtain final client trial balances and prepared by client (PBC) items 9/7/2021
On-site year-end financial statements fieldwork 09/13/2021*-10/15/2021
Reporting
Receipt of draft MD&A, financial statements, notes and other RSI for the City 9/20/2021
Receipt of draft MD&A, financial statements, notes and other RSI for the other reports 9/20/2021
Review Annual Street Report 10/8/2021
Review of draft Comprehensive Annual Financial Report and other reports with the City 10/15/2021
Deliver and submission of Annual Street Report 10/29/2021
Deliver Comprehensive Annual Financial Report and Single Audit Reports to the City 10/29/2021
Deliver all other reports (including Required Communication to City Council)10/29/2021
Review Annual Financial Transactions Report 1/7/2021
Deliver and submission of Annual Financial Transactions Report 1/31/2022
Deliver Federal and State tax returns for the Palo Alto Public Improvement Corporation 02/15/2022
Communication
Weekly status meetings 09/13/2021-10/29/2021
Exit conference: review with Management the results of the engagement 10/29/2021
On-Going Services
Meet and consult with the City Auditor and City management throughout the year on business and
accounting issues.On-going
* Year-end fieldwork starts two weeks after receipt of agreed-upon PBC items.
DATES
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EXHIBIT “C”
COMPENSATION, AMENDMENT NO. 2
(AMENDED, REPLACES PREVIOUS)
The CITY agrees to compensate the CONSULTANT for professional services performed in
accordance with the terms and conditions of this Agreement based on the hourly rate schedule
attached as Exhibit C-1.
The compensation to be paid to CONSULTANT under this Agreement for all services described in
Exhibit “A” (“Services”) and reimbursable expenses shall not exceed $959,697.00. CONSULTANT
agrees to complete all Services, including reimbursable expenses, within this amount. In the event
CITY authorizes any Additional Services, the maximum compensation shall not exceed
$1,050,569.00. Any work performed or expenses incurred for which payment would result in a
total exceeding the maximum amount of compensation set forth herein shall be at no cost to the
CITY.
REIMBURSABLE EXPENSES
The administrative, overhead, secretarial time or secretarial overtime, word processing,
photocopying, in-house printing, insurance, and other ordinary business expenses are included
within the scope of payment for services and are not reimbursable expenses. CITY shall reimburse
CONSULTANT for the following reimbursable expenses at cost. Expenses for which CONSULTANT
shall be reimbursed are: None
However, if CITY authorizes reimbursable expenses, all requests for payment of expenses shall be
accompanied by appropriate backup information. Any expense shall be approved in advance by
the CITY’s project manager.
ADDITIONAL SERVICES
The CONSULTANT shall provide additional services only by advanced, written authorization from
the CITY. The CONSULTANT, at the CITY’s project manager’s request, shall submit a detailed
written proposal including a description of the scope of services, schedule, level of effort, and
CONSULTANT’s proposed maximum compensation, including reimbursable expenses, for such
services based on the rates set forth in Exhibit C-1. The additional services scope, schedule and
maximum compensation shall be negotiated and agreed to in writing by the CITY’s Project
Manager and CONSULTANT prior to commencement of the services. Payment for additional
services is subject to all requirements and restrictions in this Agreement.
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EXHIBIT “C-1”
HOURLY RATE SCHEDULE, AMENDMENT NO. 2
(AMENDED, REPLACES PREVIOUS)
For fiscal years 2017–2018 through 2020–2021, CONSULTANT’s hourly rate schedule is as follows:
Page 14 of 15
Fees for subsequent years shall be adjusted to reflect increases in the consumer price index, up to a maximum of
3% per year. After the initial year, the maximum annual fee amount, if a 3% increase is granted, shall be:
2017 – 2018 $154,423.00
2018 – 2019 $159,055.00
2019 – 2020 $163,827.00
2020 – 2021 $168,742.00
See following page regarding fiscal year 2021-2022 fees.
(CONTINUED ON THE NEXT PAGE.)
Page 15 of 15
For fiscal year 2021–2022, CONSULTANT’s hourly rate schedule is as follows:
Fees for subsequent years may, by agreement of the parties, be adjusted to reflect increases in the consumer
price index, up to a maximum of 3% per year.
Vers.: Aug. 5, 2019
Page 1 of 2
AMENDMENT NO. 1 TO CONTRACT NO. C16161769
BETWEEN THE CITY OF PALO ALTO AND
MACIAS GINI & O’CONNELL LLP
This Amendment No. 1 (this “Amendment”) to Contract No. C16161769 (the “Contract” as
defined below) is entered into as of January 15, 2021, by and between the CITY OF PALO ALTO, a
California chartered municipal corporation (“CITY”), and MACIAS GINI & O’CONNELL LLP, a limited
liability partnership, located at 2121 N. California Blvd., Suite 750, Walnut Creek, California, 94596
(“CONSULTANT”). CITY and CONSULTANT are referred to collectively as the “Parties” in this
Amendment.
R E C I T A L S
A. The Contract (as defined below) was entered into by and between the Parties
hereto for the provision of external auditing services, as detailed therein.
B. The Parties now wish to amend the Contract in order to extend the term by six
months, from the original contract end date of January 21, 2021 through July 21, 2021, with no
change to the maximum compensation payable under the Contract.
NOW, THEREFORE, in consideration of the covenants, terms, conditions, and provisions of
this Amendment, the Parties agree:
SECTION 1. Definitions. The following definitions shall apply to this Amendment:
a. Contract. The term “Contract” shall mean Contract No. C16161769
between CONSULTANT and CITY, dated April 11, 2016.
b. Other Terms. Capitalized terms used and not defined in this Amendment
shall have the meanings assigned to such terms in the Contract.
SECTION 2. Section 2. “TERM” of the Contract is hereby amended to read as follows:
“SECTION 2. TERM. The term of this Agreement shall be from the date of its full
execution through July 21, 2021, unless terminated earlier pursuant to Section 19 of
this Agreement.”
SECTION 3. Legal Effect. Except as modified by this Amendment, all other provisions of the
Contract, including any exhibits thereto, shall remain in full force and effect.
SECTION 4. Incorporation of Recitals. The recitals set forth above are terms of this
Amendment and are fully incorporated herein by this reference.
DocuSign Envelope ID: 21B4C992-C9DA-46BF-832D-2F68EE6E142C
Vers.: Aug. 5, 2019
Page 2 of 2
SIGNATURES OF THE PARTIES
IN WITNESS WHEREOF, the Parties have by their duly authorized representatives executed
this Amendment effective as of the date first above written.
CITY OF PALO ALTO
City Manager
APPROVED AS TO FORM:
City Attorney or designee
MACIAS GINI & O’CONNELL LLP
By:
Name:
Title:
DocuSign Envelope ID: 21B4C992-C9DA-46BF-832D-2F68EE6E142C
David Bullock
Partner
Cassie Coleman
Ed Shikada
Certificate Of Completion
Envelope Id: 21B4C992C9DA46BF832D2F68EE6E142C Status: Completed
Subject: Please DocuSign: Amendment #1 C16161769 MGO - Legal Reviewed.pdf
Source Envelope:
Document Pages: 2 Signatures: 3 Envelope Originator:
Certificate Pages: 2 Initials: 0 Terry Loo
AutoNav: Enabled
EnvelopeId Stamping: Enabled
Time Zone: (UTC-08:00) Pacific Time (US & Canada)
250 Hamilton Ave
Palo Alto , CA 94301
Terry.Loo@CityofPaloAlto.org
IP Address: 199.33.32.254
Record Tracking
Status: Original
1/12/2021 4:40:47 PM
Holder: Terry Loo
Terry.Loo@CityofPaloAlto.org
Location: DocuSign
Security Appliance Status: Connected Pool: StateLocal
Storage Appliance Status: Connected Pool: City of Palo Alto Location: DocuSign
Signer Events Signature Timestamp
David Bullock
dbullock@mgocpa.com
Partner
Security Level: Email, Account Authentication
(None)Signature Adoption: Pre-selected Style
Using IP Address: 98.35.35.26
Sent: 1/12/2021 4:47:07 PM
Viewed: 1/13/2021 12:48:36 AM
Signed: 1/13/2021 12:54:47 AM
Electronic Record and Signature Disclosure:
Not Offered via DocuSign
Cassie Coleman
cassie.coleman@cityofpaloalto.org
Assistant City Attorney
Security Level: Email, Account Authentication
(None)Signature Adoption: Pre-selected Style
Using IP Address: 199.33.32.254
Sent: 1/13/2021 12:54:49 AM
Viewed: 1/13/2021 10:04:41 AM
Signed: 1/13/2021 10:04:56 AM
Electronic Record and Signature Disclosure:
Not Offered via DocuSign
Ed Shikada
ed.shikada@cityofpaloalto.org
Ed Shikada, City Manager
City of Palo Alto
Security Level: Email, Account Authentication
(None)
Signature Adoption: Pre-selected Style
Using IP Address: 98.42.3.200
Sent: 1/13/2021 10:04:58 AM
Viewed: 1/13/2021 11:45:15 AM
Signed: 1/13/2021 11:46:02 AM
Electronic Record and Signature Disclosure:
Not Offered via DocuSign
In Person Signer Events Signature Timestamp
Editor Delivery Events Status Timestamp
Agent Delivery Events Status Timestamp
Intermediary Delivery Events Status Timestamp
Certified Delivery Events Status Timestamp
Carbon Copy Events Status Timestamp
Rocelyn Fernando
Rocelyn.Fernando@CityofPaloAlto.org
Interim Accounting Manager
City of Palo Alto
Security Level: Email, Account Authentication
(None)
Sent: 1/13/2021 11:46:04 AM
Electronic Record and Signature Disclosure:
Not Offered via DocuSign
Witness Events Signature Timestamp
Notary Events Signature Timestamp
Envelope Summary Events Status Timestamps
Envelope Sent Hashed/Encrypted 1/12/2021 4:47:07 PM
Certified Delivered Security Checked 1/13/2021 11:45:15 AM
Signing Complete Security Checked 1/13/2021 11:46:02 AM
Completed Security Checked 1/13/2021 11:46:04 AM
Payment Events Status Timestamps