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Staff: Committee members: Steven Teglia, Assistant to the City Manager Russell Johnson, Chair Sue Benham Ken Weir REGULAR MEETING OF THE BUDGET AND FINANCE COMMITTEE
of the City Council - City of Bakersfield
Monday, March 26, 2012
12:00 p.m.
City Hall North
1600 Truxtun Avenue, Bakersfield, CA 93301
First Floor, Conference Room A
A G E N D A
1. ROLL CALL
2. ADOPT FEBRUARY 27, 2012 AGENDA SUMMARY REPORT
3. PUBLIC STATEMENTS
4. NEW BUSINESS
A. Discussion and Committee Recommendation Regarding Auditors
Selection Process – Smith
5. COMMITTEE COMMENTS
6. ADJOURNMENT
CORRECTED
Committee Members:
Staff: Steven Teglia Russell Johnson, Chair
Assistant to the City Manager Sue Benham
Ken Weir
AGENDA SUMMARY REPORT
REGULAR MEETING OF THE
BUDGET AND FINANCE COMMITTEE
Monday, February 27, 2012
12:00 p.m.
City Hall North – Conference Room A
1600 Truxtun Avenue
Bakersfield, CA 93301
The meeting was called to order at 12:00 PM
1. ROLL CALL
Committee members present: Councilmember Russell Johnson, Chair
Councilmember Sue Benham
Councilmember Ken Weir
Staff present:
Alan Tandy, City Manager Ginny Gennaro, City Attorney
Rhonda Smiley, Asst. to the City Manager Josh Rudnick, Deputy City Attorney
Steven Teglia, Asst. to the City Manager Andrew Heglund, Associate Attorney
Chris Huot, Administrative Analyst Nelson Smith, Finance Director
Greg Williamson, Chief of Police Kim Berrigan, Purchasing Officer
Others Present:
Chad Manning, Jim Burke Ford Debbie Moreno, Chambers of Commerce
Antonie Boessenkool, Bakersfield Californian
AGENDA SUMMARY REPORT
Budget and Finance Committee Meeting
Monday, February 27, 2012
Page 2
2. ADOPT JANUARY 30, 2011 AGENDA SUMMARY REPORT
Adopted as submitted.
3. PUBLIC STATEMENTS
None
4. DEFERRED BUSINESS
A. Discussion and Committee Recommendation Regarding Local Vendor Preference
Policy – Smith
Finance Director Nelson Smith reported that none of the surveyed cities had a
mathematical justification for anything above a one percent vendor preference;
those having a one percent vendor preference were associated with the amount
of Sales Tax returned to the City in exchange for the local purchase. Reviewing
the purchasing data discussed at the previous meeting, one third of purchases,
$6,256,000 of the $20,390,000 12 month history total, are award to local vendors;
another third, $6,800,000, are award to vendors which produce products which
are not available within City limits; and another third, $7,340,400, awarded to
vendors outside the City including a bid award of $4 million for fuel. Based on this
information, if every one of the outside awards was subject to the 3% credit, it
could potentially cost the city approximately $220,212 annually. Finance Director
Smith also provided a summary of how a 3% local vendor preference might work.
Committee member Weir stated that the 3% local vender preference should only
apply to a local vendor if their original bid amount places then as the 2nd lowest
overall bidder.
Debbie Moreno representing the Chamber of Commerce asked how typical a
situation is where the 2nd lowest bid is from a vendor within the City limits.
Finance Director Smith stated that the majority of the one third of bids awarded to
vendors outside the city has no local bidders competing. Having an additional
preference in place, may encourage local vendor participation.
Committee Chair Russell Johnson asked Finance Director Smith what would be an
appropriate dollar “cap” to limit the City’s overall exposure to any increase as a
result of the enhanced local vendor preference policy.
Finance Director Smith stated the current bids being received are approximately
between $200,000 to $250,000 and lower. A credit of $7,500 to $10,000 would
cover a large portion of participants; the lowest possible credit would limit the
City’s exposure.
AGENDA SUMMARY REPORT
Budget and Finance Committee Meeting
Monday, February 27, 2012
Page 3
Committee Chair Johnson asked if these changes would comply with the City
Charter.
City Attorney Ginny Gennaro stated the City would be in compliance. If the
Committee desires to proceed, the current policy would be amended to include
the two new revisions; establishing a “cap” and limiting it to be applied to a local
vender when they are the 2nd lowest bidder.
Committee member Weir made a motion to increase the vendor preference to
3% for local bidders who are the 2nd lowest bidders with a “cap” of $9,000.
The motion was unanimously approved.
5. COMMITTEE COMMENTS
None
6. ADJOURNMENT
The meeting adjourned at 12:13 PM
cc: Honorable Mayor and City Council
MEMORANDUM
TO:
FROM:
BUDGET AND FINANCE COMMITTEE MEMBERS
NELSON K. SMITH, f.INANCE DIRECTOR /V'..:5
MARCH 26, 2012 DATE:
SUBJECT: SELECTION OF AUDITOR
In February 2012, a Request for Proposal for auditing services was posted on the City's
online vendor and bid management system. Fourteen firms showed an interest in the
process. Four firms submitted proposals which were reviewed by the Finance
Department. Three of the four firms meet the experience requirements to perform the
City's audit. The three firms, tl)eir estimated hours and total bid amounts are as follows:
• Brown Armstrong -Bakersfield, CA
Hours estimate = 660 hours
Dollar Bid = $59,800
• Price Paige & Company-Clovis, CA
Hours estimate = 544 hours
Dollar Bid = $68,335
• White Nelson Diehl Evans-Irvine, CA
Hours estimate = 808 hours
Dollar Bid = $89,500
Sotomayor & Associates, the fourth firm, had limited governmental experience and is
not being recommended for consideration.
The Request for Proposal contemplates a five year commitment with the selected firm,
with the 2011-12 fiscal year being year T of 5. A cost of living factor is built into the
contract so that future year costs do not exceed Consumer Price Index (CPI) inflation
measures, assuming no change in the scope of the audit and assuming no significant
change in the audit workload as a result of Governmental Accounting Standards
Boards (GASB) actions that might take place in the future.
Staff is looking to the committee for a recommendation regarding auditor selection.
Cc: Alan Tandy
Ginny Genaro
S:\Admin\Memos\Auciit services 2012.doc
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