PROFESSIONAL CONSULTING SERVICES AGREEMENT
PROFESSIONAL CONSULTING SERVICES AGREEMENT
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This Professional Consulting Services Agreement (the "Agreement") is made this 11L-
day of ~ 2008 by and between the City of Clearwater (hereinafter referred to as
"Client"), an~ercury Associates, Inc., a Maryland corporation (hereinafter referred to as
"Consultant").
WITNESSETH:
WHEREAS, Client is interested in completing a detailed study of vehicle use and fleet
size in time to assist the Client in its budget approving process; and
WHEREAS, Consultant has the capacity, skill, and experience in producing
comprehensive studies in the field of fleet utilization efficiency; and
WHEREAS, Client desires to utilize Consultant's unique service to provide a detailed
study for the aforementioned purpose;
NOW, THEREFORE, in consideration of the mutual promises contained herein, the
Client and Consultant agree as follows:
1. SCOPE OF SERVICES: Consultant shall perform the services ("Services") set forth in
the Scope of Services attached hereto as Exhibit A and incorporated herein by this reference.
Consultant shall perform the Services in a professional and expeditious manner.
2. TERM: Consultant shall commence Services on or about ~ 13 I dtc>~. This
Agreement shall remain in effect until such time as the Services described in Exhibit A and any
amendments thereto are completed in accordance with the specifications and descriptions set
forth in Exhibit A to the reasonable satisfaction of the Client and payment for all such services
has been completed.
3. COMPENSATION AND PAYMENT: In consideration of Consultant's performance of
Services hereunder, Client shall pay to Consultant fIXed-price fee of forty thousand dollars
($40,000). The aforementioned fee amount excludes any sales, gross receipts, or other taxes
for which the Consultant may be liable for performing the Services hereunder. The Client shall
be responsible for paying any such taxes levied on the Services, other than taxes on
Consultant's income.
Consultant shall issue monthly invoices for Services during the Term of the agreement.
Such invoices will include fees based on the estimated percentage of completion of each of the
Services tasks set forth in Exhibit A, applicable taxes (if any), and out-of-pocket expenses
incurred. Receipts for all expenses of $25 or more billed to the Client will be maintained on file
by the Consultant and furnished to the Client upon request. Client shall pay all invoices within
thirty (30) days of receipt.
4. PERSONNEL: Consultant represents that it has, or will secure at its own expense, all
personnel necessary to perform the Services required under this Agreement. All of the Services
required hereunder shall be performed by Consultant or under its supervision, and all personnel
engaged in performing the services shall be qualified to do so. Consultant reserves the right to
subcontract for Services hereunder, and Consultant warranties that all such subcontractors shall
have insurance coverage equal to that of Consultant.
5. INDEPENDENT CONTRACTOR. Client and Consultant are, and intend to remain,
independent contractors and this Agreement shall not be construed to create any joint venture,
partnership, business organization or employer-employee relationship. Under no circumstances
shall Consultant or any of its employees or subcontractors be deemed an employee of Client.
Except as specffically authorized by Client in writing, Consultant shall have no authority to act
on behalf of or to bind Client.
6. CONSULTANT COVENANTS.
6.1 Services Warranty. Consultant warrants that all Services to be performed
hereunder shall be performed in accordance with professional standards in the automotive fleet
consulting field. Consultant shall comply with all applicable laws, ordinances, rules, regulations
and statutes or any governmental agency bearing on its performance of Services hereunder.
6.2 Insurance. Consultant shall provide a certificate of insurance prior to
commencement of the engagement, and if a subcontractor is required by Consultant, then
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Consultant shall provide a certificate of insurance for that subcontrador prior to the
commencement of any work by the subcontrador. The certificate shall clearly indicate that the
Consultant and/or the subcontrador has obtained insurance including identification of the type
and amount of coverage. If Consultant and/or subcontrador allow any insurance required
under this article to lapse, Client may, at its option, take out and pay the premiums on the
necessary amounts spent to comply, and Client is entitled to immediate reimbursement from
Consultant and/or subcontrador for all amounts spend to procure and maintain such insurance.
7. CLIENT COVENANTS.
7.1 Cooperation. Client shall cooperate with Consultant in Consultant's
performance of Services, and shall provide timely and expeditious access to Client's facilities,
personnel and information and data as may be reasonably necessary for Consultant to
complete the Services hereunder.
7.2 Information. Client represents and warrants that all information and data
provided by Client to Consultant hereunder is accurate, timely and complete and shall indemnify
and hold harmless Consultant from any liability for any breach of this representation and
warranty.
8. OWNERSHIP OF DELlVERABLES. Consultant shall deliver to the Client all
deliverables required to be submitted consistent with the Scope of Services set forth in Exhibit
A. All deliverables shall be the property of Client, except to the extent such deliverables contain
any "Consultant Intellectual Property" as defined in Sedion 9 below, which Consultant
Intelledual Property shall remain the exclusive property of Consultant and shall be licensed to
Client for Client's authorized use. All working papers shall remain the property of Consultant.
Consultant shall maintain its working papers for a period of three (3) years from the date of
execution of this Agreement.
9. CONFIDENTIALITY; PROPRIETARY INFORMATION. The parties acknowledge that it
may be necessary for each of them to disclose or make available to the other information and
material that is confidential, proprietary and/or a trade secret of such party ("Confidential
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Information"}. Confidential Information shall include, but not be limited to, a party's products,
software, financial information, business and marketing plans, customers and prospects,
business methods and methodologies. Both during and after the Term of this Agreement, each
of the parties agrees to use its best efforts to protect the Confidential Information of the other
from unauthorized use or disclosure and to use and reproduce the Confidential Information of
the other only as permitted under this Agreement and only as needed to perform its duties
hereunder. Each party further covenants and agrees that neither it nor its employees,
subcontractors or agents will, directly or indirectly, use any of the other's Confidential
Information for its own use or the use by any third party. Further, Client acknowledges that
Consultant has developed and created its software, business methods and methodologies,
business expertise and client and supplier lists (collectively, "Consultant Intellectual Property").
To the extent Consultant incorporates any of its Consultant Intellectual Property in any
deliverables or otherwise discloses any of its Consultant Intellectual Property to Client, such
Consultant Intellectual Property shall remain the exclusive property of Consultant and shall only
be licensed to Client for the specific use contemplated hereunder. Each party acknowledges
that any breach of their respective obligations and duties under this Section 9 will cause the
other party irreparable harm for which monetary damages alone are not sufficient and the non-
breaching party shall be entitled to seek all of its remedies at law and in equity, including
injunctive relief without the necessity of posting a bond or other security.
10. INDEMNIFICATION: Client shall defend, indemnify and hold Consultant free and
harmless from and against any claims, demands, actions, damages, expenses, fees, or
liabilities: 1} arising from the acts or failures to act by the Client or its agents; and 2} arising only
from any reckless or grossly negligent use by Client of the deliverables or report prepared by
Consultant hereunder. Client shall not be liable for indemnifying Consultant, or Consultant's
agents, servants, employees, subcontractors for any claims, demands, actions, damages,
expenses, fees, or liabilities caused by any act, omission, or neglect of Consultant, or
Consultant's agents, servants, employees, subcontractors arising from the performance of the
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obligations hereunder. Moreover, nothing herein shall constitute a waiver by Client of its
sovereign immunity and the limitations set forth in Section 768.28 Florida Statutes.
11. LIMITATION OF LIABILITY. Neither party shall be liable for any special, indirect,
incidental or consequential damages arising from or related to this Agreement, including without
limitation loss of use, loss of data, loss of revenues or profits, or failure to realize savings or
other benefits, even if the party has been advised of the possibility of such damages.
12. TERMINATION. Either party may terminate this Agreement by written notice to the
other party upon the breach of any material term or condition of this Agreement by the other
party if such breaching party fails to substantially cure such breach within thirty (30) days of its
receipt of written notice of such breach. In the event of such termination, Client shall pay to
Consultant for. all Services performed and expenses incurred through the effective date of
termination. After such termination, Consultant shall provide a final invoice to Client, and Client
shall pay such invoice within thirty (30) days of its receipt.
13. FORCE MAJEURE. Neither party shall be in default of any of its obligations hereunder
by reason of any delay in or failure of such party's performance under this Agreement if such
delay or failure results, either directly or indirectly, from causes beyond such party's reasonable
control.
14. GENERAL.
14.1 Assignment Neither party may assign or delegate any of its rights, duties or
obligations hereunder (except for permissible subcontract of specific Services by Consultant)
without the prior written consent of the other party; provided, however, that either party may
assign, conveyor transfer its interest, rights and duties in this Agreement to an affiliated or
parent company which succeeds to substantially all of the business of such party.
14.2 Notices. All written notices, demands or requests of any kind which either party
may be required or may desire to serve on the other in connection with this Agreement may be
served (as an alternative to personal service) by registered or certified mail or air freight
services that provide proof of delivery. Any such notice or demand so served by registered or
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certified mail shall be deposited in the United States mail with postage and fees thereon fully
prepaid, and addressed to the parties so to be served as follows:
If to Consultant:
Mercury Associates, Inc.
16051 Comprint Circle
Gaithersburg, MD 20877
Attention: Paul Lauria, President
If to Client:
City of Clearwater
Finance Department
A TIN: Margie Simmons
P.O. Box 4748
Clearwater, FL 33758
City of Clearwater
City Attorney
P.O. Box 4748
Clearwater, FL 33758
Copy to:
Service of any such notice or demand so made by mail shall be deemed complete on the day of
actual delivery as shown by the addressee's registry or certification receipt. Either party hereto
may from time to time, by notice in writing served upon the other as aforesaid, designate a
different mailing address, or (a) different or additional person(s) to which or to whom all such
notices or demands are thereafter to be addressed. Persons named to receive copies of
notices are listed for accommodation only and are not required to be served to comply with
service of notice on a party (are required to be served to comply with service of notice).
14.3 Severability. If any term or provision of this Agreement shall be held invalid or
unenforceable, they are, to that extent deemed omitted. The rest of this Agreement shall
remain in full force and effect.
14.4 Waiver. The waiver of either Consultant or Client of a breach of any provision of
this Agreement shall not operate or be construed as a waiver of any subsequent breach by
either Consultant or Client.
14.5 Third Parties. The Client and the Consultant are the only parties to this
Agreement and are the only parties entitled to enforce its terms. Nothing in this Agreement
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gives, is intended to give, or shall be construed to give or provide, any right or benefrt, whether
directly or indirectly or otherwise, to third persons.
14.6 Governing Law; Remedies; Venue. This Agreement shall be construed and
interpreted pursuant to the lawsof the State of Florida. No remedy provided hereunder is
intended to be exclusive of any other remedy, and every remedy shall be cumulative and shall
be in addition to every other remedy existing at law or in equity. The parties agree that venue for
any proceedings brought to enforce this Agreement shall be in Pinellas County, Florida
14.7 Entire Agreement This Agreement, including any Exhibits referenced herein
and attached hereto, is the complete and exclusive agreement of the parties with respect to the
subject matter hereof, and supersedes all prior and contemporaneous agreements, promises,
proposals, representations and warranties, oral or written with respect to the same subject
matter. Any change, alteration or modification to this Agreement must be in writing and signed
by both the Client and the Consultant.
IN WITNESS WHEREOF, each of the parties has executed this Agreement as of the
respective dates set forth below.
CONSULTANT:
MERCU~ ASSOCIATES, INC.
By: lu~ (}\Ar---
Randy Owen, Senior VP
Date: ~ '7 t 2o~
CLIENT:
City of Clearwater ~ ~
~~K :A~~
'--Frank V. Hibbard IIliam B. Horne, II
Mayor City Manager
Approved as to form:
Attest:
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Camilo A. Soto
Assistant City Attorney
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EXHIBIT A
SCOPE OF SERVICES
TASK 1 - CONDUCT DETAILED STUDY OF VEHICLE USE TO RIGHT SIZE THE
FLEET
The primary driver of fleet related costs for any organization is the size and composition of the
fleet. Simply stated, the more vehicles an organization owns, the higher the annual cost. This is
due to the fact that depreciation is the top fleet cost. Every day that a vehicle is owned by an
organization it loses market resale value. Moreover, even under-utilized vehicles consume fuel
and maintenance resources each year. Consequently, as with any organization that operates a
large fleet, any serious effort to lower the City's fleet costs needs to start with right-sizing the
fleet. The steps that we propose to assist the City right size its fleet is as follows:
Steo 1: Develoo Detailed Fleet Deolovment and Use Profile
We will begin our data analysis by developing a detailed inventory of vehicles and equipment by
vehicle type, by customer organization, and by physical location. This information will be used
to develop a map of vehicle domiciles so that any overlaps in vehicle assignments can be
identified. We will also use this information to analyze the proximity of vehicle user office and
corporation yards to those of other vehicle users, the proximity of sites to motor pool locations,
and the proximity of sites to commercial vehicle rental locations. Finally, we will develop annual
use profiles for each vehicle in the fleet.
Steo 2: Analvze Vehicle Utilization Data
Our next step will be to conduct an in-depth review of data relative to vehicle assignment and
utilization. This review will include calculation of average use by vehicle class, development of
utilization thresholds for each type of vehicle, and identification of units that have low life
mileage and, therefore, are candidates for a more intensive review. We will also review
available information regarding the City's past use of, and expenditures for, rental cars and
equipment, and reimbursement of private car mileage.
Steo 3: Survev Fleet Users
Utilization statistics alone, of course, can be misleading indicators of the need for a vehicle or
piece of equipment. A common definition of a vehicle being in use is when it is not available for
use by another organization. In many such situations, a vehicle that is in use mayor may not be
accumulating many (or any) miles or engine hours. For example, a pickup truck assigned to a
carpenter may function as a tool box on wheels and carry materials to a job site where the
vehicle sits for extended periods. Analysis of historical miles driven will indicate that it is not
used very much, but this clearly does not mean that the unit is underutilized or not needed.
Consequently, we will analyze equipment utilization from a number of perspectives in addition to
meter readings for low mileage units and will also tailor our analysis to the different types of
equipment and conditions in which user organizations operate. Other pertinent factors for
analyzing equipment use and an organization's need for assignment of a vehicle include:
. Passenger, cargo carrying, and towing requirements;
. Requirements to transport tools and equipment;
. Any special security needs;
. Requirements for special equipment and attachments;
. Emergency response requirements;
. Typical required times of use including after normal working hours;
. Seasonal and peak periods of use; and
. The existence of any backup or spare units.
We will gather this information through use of a web-based survey and interviews with City staff
(both on-site and telephone). Our goal will be to assist managers determine their base fleet
needs by reviewing the fleet assignment matrix, historical use data, employee assignments, and
work activities.
SteD 4: DeveloD a Table of Allocation for the Fleet
From our analysis of available data, the results of our vehicle utilization questionnaire, meetings
with FMD managers, and an analysis of the costs of alternatives to permanent vehicle
assignment, we will develop a table of allocation for the fleet that characterizes each vehicle
need as falling into one of the following categories:
. Justified permanent assignment to an individual or work crew;
. Opportunity for shared use of an assigned vehicle;
. Opportunity for use of a pooled vehicle;
. Opportunity for use of a commercial rental vehicle;
. Opportunity to reimburse an employee for use of their personal vehicle; and
. Opportunity for reduction or disposition.
While the fleet right-sizing task will require a high level of effort to complete and thus is the
most costly task in our work plan, it also has the potential to provide significant cost-savings.
So much so that we are confident that savings/cost avoidance/revenue generated over the
next three years resulting from this task will pay the entire cost of the study many times over.
Also please note that in order to keep the budget down we have not included the. cost of
making a formal presentation of study results to the City. If the City feels that a presentation is
needed, we will be happy to provide a separate quote for this effort.
COST PROPOSAL AND TIMELlNE
Our proposed firm fixed price for conducting this project is $40,000 inclusive of all professional
fees and travel expenses. This proposed budget is based on an average professional billing
rate of $175 per hour.
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We propose to invoice the City on a monthly basis for actual work completed and expenses
incurred. We will provide appropriate details on study progress to support each invoice
submitted.
We estimate that this project will take 3 months to complete from receipt of an official notice to
proceed. Please note this timeline assumes that we receive all requested data, documentation,
and access to individuals for interviews and meetings, as well as feedback on any draft reports
from FMD in a timely manner.
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