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GENERAL FUND FINANCIAL SUSTAINABILITY ANALYSIS UPDATE - PROPOSED AGREEMENTStantec February 16, 2018 Mr. Jay Ravins, Finance Director City of Clearwater Municipal Services Building, 3rd Floor 100 S. Myrtle Ave. Clearwater, FL 33756 Re: General Fund Financial Sustainability Analysis Update - Proposed Agreement Dear Mr. Ravins: As requested, I have prepared this proposed Agreement for the above referenced analysis to conduct an FY 2018 General Fund Financial Sustainability Update Study (Study). The following sections present our proposed approach to the Study and our estimated fees for conducting the Study. Scope of Work The scope of work will be to update the General Fund Financial Sustainability Analysis that we conducted for the City in FY 2016. This will include adjusting the projection period in the model, updating the underlying property data upon which the model is based, running a Status Quo scenario, which will be a diagnostic view of the projected financial condition of the City over the ten year projection period, and identifying potential scenarios as applicable to ensure financial sustainability of the City's General Fund over the ten year projection period. We will also conduct two interactive work sessions with City staff to review the results of the analysis. We will also conduct one-on-one meetings with City Council Members to review the results of the analysis and we will make a presentation to the City Council in a Council workshop. We will then prepare a final report of the analysis. Fee Proposal I have prepared a detailed Project Work Plan and Fee Estimate Schedule (Schedule), which is included in the Appendix and a Fee Summary by Work Element is presented below. orki men Work Element - 1: Diagnostic Evaluation and Development of a Sustainable Ten Year Financial Plan Work Element - 2• Present Findings to City Management and Council and Prepare a Final Report Total Project (inclusive of out-of-pocket expenses) 514,958 510,692 $25,650 Stantec 200 Business Park Circle. Suite 101 • St. Augustine. Florida 32095 • Phone (904) 247-0787 E-mail: michaet.burton itstantec.com Page 1 Therefore, we propose to complete the Study for the Total Fixed Fee amount shown in the above Fee Summary by Work Element that would be invoiced monthly based upon the percentage of each task completed. To the extent that additional presentations, meetings, analysis, or any other services are requested by the City that are beyond the scope identified in the above referenced Schedule, they would be completed based upon the necessary time and the hourly rates identified within the Schedule plus actual out -of --pocket expenses. Schedule We can begin work on this assignment immediately and estimate that the Study can be completed within 90 days. Conclusion We appreciate the opportunity to present this proposed Agreement and look forward to working with you on this assignment. If the terms of this Proposed Agreement and the attached Terms and Conditions are acceptable to the City, please affix the appropriate signature on the following page and return a copy to me for our files. A facsimile copy will be fine. If you have any questions, please do not hesitate to call me at (904) 247-0787. Very truly yours, Michael E. Burton Vice President Enclosure Stantec 200 Business Park Circle, Suite 101 • St. Augustine, Florida 32095 • Phone (904) 247-0787 E-mail: michael.burton4stantec.com Page 2 If this proposal and the enclosed Terms and Conditions of this proposed Agreement are acceptable, please affix the appropriate signature below and return a copy (facsimile will be acceptable) to us for our files. Stantec Consulting Services, Inc. will conduct a FY 2018 General Fund Financial Sustainability Analysis Update for a fixed fee of $25,650, to be billed monthly based upon percent complete by sub -task as represented on the Project Work Plan and Fee Estimate Schedule in the Appendix. City of Clearwater, Florida A municipal corporation and Political subdivision of the State of Florida William B. Horne City Manager Date Ap yid as to rm: Attest: ,,� ,‘e., L 4 (4) mice" A4po RosemaryCall ossis#cwt City Attorney City Clerk Stantec Consulting Services, Inc. Michael E. Burton Vice President - Financial Services 2/16/18 Date Attest: bin Lightsey Administrative Assistant Stantec 200 Business Park Circle. Suite 101 • St. Augustine, FiondO 32095 • Phone 1904) 247-0787 . E-mail: michael.burton*stontec.com Page 3 (� TASK1 1.1 1.2 APPENDIX City of Clearwater 1Y 20l'' r. 1 i RATED FINANCIAL SUSTAINABILITY ANALYSIS UP[) l i PROJECT WORK PLAN & COST ESTIMATE Rama TASKS till 1 Initiate the Project Conduct Project Kick-off meeting via conference call Obtain and review property, customer, usage and financial and operating data need for the analysis of all funds TASK2 Customize FAMS-XL® Model for the City's General Fund 2.1 Define specific requirements and refinements of the General Fund (GF) Model functionality and data required b Prepare data requirements list to include financial and other data to be provided by the City and property data, from the County Property Appraiser's Office c Review information/data provided and request clarification/additional data as required d Conduct conference with City staff to discuss issues with data, timeline, reaffirmation of the system requirements, 2.2 Make adjustments to GF Model to address specific General Fund user requirements, fund linkages and data and as determined in the prior task 2.3 Make adjustments to GF Model to address specific CRA user requirements and data as determined in the prior task. TASK 3 Populate the model and perform analysis, including evaluation of cost reduction and revenue diversification 3.1 Input financial, property, and other data into Burton & Associates' proprietary FAMS XL© model for the General Fund model, project year end results for the current year and run the model and produce preliminary output for identified scenarios, including a ten year financial management program that will include the following o Property data base by parcel Complete data base of all parcels on the City with relevant information such as taxable value, exemptions, current tax, etc., including adjustment factors for each parcel, or parcels by property classes, for future years Above referenced property data base integrated so that changes in assumptions for future years are linked to the calculation algorithms of the model o Operations and Maintenance (0&M) Budget and projections - O&M budget categories initial year budget and projections of budget in future years - Inflation factors for each O&M budget cost category o Capital Improvements Program (10 year) Project listing by year (including alternative Master Plan/CIP scenarios) - Identification of funding source by project by year for each scenario o Borrowing Program (for each Master Plan/CIP scenario) Borrowing required (by source) to fund CIP projects not funded by other sources to include but not necessarily be limited to revenue bonds and State or other programs. Timing of bond issues)/loan(s) to provide required borrowed funds Annual debt service of bond issues)/loan(s) o Revenue Sufficiency Analysis - Annual revenue projections for all GF revenue sources, including variable annual adjustment factors for each revenue source Stant Project Prindpal Project Director Project Analyst $331 0 0 0 0 0 5115 Accomplishe 0 0 0 5121 1 1 d in Initial Stu 0 0 4 0 0 0 0 0 16 dy Stantec 200 Business Park Circle. Suite 101 • St. Augusline. Florida 32095 • Phone (904) 247-0787 E-mail: michael.burton astanfec.com Page 1 APPENDIX City of Clearwater Y 2018 INTEGRATED FINANCIAL SUSTAINABILITY ANALYSIS UPDATE PROJECT WORN PLAN & COST ESTIMATE Stnntec ROIECr TA5K5 a�. .•Y,,s=', Pr•i.a M1MWNII hoard Minter P *Ct Analyst 5332 5205 5127 - Annual plan to provide sufficient revenues for each scenario evaluated through adjustments to O&M costs, capital costs, millage rates, etc. o Sources and Uses of Funds Analysis o Funds Analysis - Spend down limits (minimum reserve requirements) by fund - Beginning and ending funds balances by fund by year. o Analysis of prior and current year performance versus performance criteria. 3.2 Program interfund transfers to/from the Water & Sewer and Electric Utility Funds. 0 0.5 1 1.5 3.3 Identify, quantify, and set-up potential revenue diversification alternatives within the General Fund model 0 0.5 1 1.5 3.4 Review preliminary output with consulting team, make adjustments, and re -run models. 1 1 2 4 3.5 Conduct an interactive review session with City staff to review the preliminary results of the ten year projection of revenue sufficiency of the General Fund and the CRA 6 6 6 18 3.6 Make adjustments based upon input from City staff and prepare preliminary schedules of initial results. 0 2 3 5 3.7 Identify alternatives to ensure financial sustainability to include cost reduction and revenue enhancement/diversification strategies. 1 1 1 3 3.8 Adjust the Model to include the strategies identified in the prior sub -tasks 0 1 2 3 3.9 Conduct a second interactive review session with City staff to review the preliminary results of the ten year projection of revenue sufficiency of the General Fund and the CRA 0 6 6 12 3.10 Make adjustments based upon input from City staff and prepare schedules of adjusted results 0 1 2 3 ;T:� TOTAL ESTIMATED CONSULTING FEE - WORK ELEMENT 1A $3,652 55,125 55,334 514,111 ESTIMATED EXPENSES - WORK ELEMENT 1A 4.DD% $564 TOTAL ESTIMATED COST - WORK ELEMENT 1A 514,675 i. nr. �..,,. .... . .1nri, ..n. I'.. d-. TASK 5 Present tlndinas to City Management and Council 5.1 Prepare a presentation of the results of the analysis, including status quo and alternative scenarios identified during the project. 0.5 1 1 2.5 5.2 Review presentation with City Staff & Management and make adjustments to presentation. 0.5 1 0 1.5 5.3 Conduct one-on-one meetings with City Council members to review the results sof the analysis 8 8 8 24 5 4 Present the results of the analysis to City Council in a workshop 0 6 0 6 5.5 Make adjustments based upon input and direction from City Council 0 1 2 3 5.6 Conduct a second interactive review session with City Council as required. --- At Hourly Ra es as Required --- 5.7 Make adjustments as required based upon the review with City Council in the prior subtask. --- At Hourly Ra es as Required --- Stantec 200 Business Pork Circle. Suite 101 • St. Augustine. Florida 32095 • Phone (904) 247-0787 E-mail: michael.burton astanfec.cam Page 2 APPENDIX City of Clearwater Y 2018 INTEGRATED FINANCIA1 SUSTAINABILITY ANALYSIS UPDATE PROJECT WORK PLAN & COST ESTIMATE ROJECT TASKS = . ,. a , 114.d...L1:C: dl.:• Project Principal Project area« Project Analyst S33 $7OS Stn TASK 6 Document the results In a Report. 1 0 --- 2 1 At Hourly Rate 8 2 as Required 11 3 --- 6.1 Document the results of the analysis in a Draft Report 6.2 Make adjustments based upon input from City staff and prepare the Final Report 6.3 Present the results of the Final Report to the City Council TOTAL ESTIMATED CONSULTING FEE WORK ELEMENT 2 ESTIMATED EXPENSES - WORK ELEMENT 2 6.00% 53,320 54,100 52,667 510,087 5605 TOTAL ESTIMATED COST - WORK ELEMENT 2 510,692 TOTAL PROJECT TOTAL ESTIMATED CONSULTING FEE - WORX ELEMENT 1 ESTIMATED EXPENSES - WORK ELEMENT 1 6.00% 56,972 59,225 58,001 524,198 51,452 TOTAL ESTIMATED COST - WORK ELEMENT 1 525,650 l Stantec 200 Business Park Circle, Suite 101 • St. Augustine. Florida 32095 • Phone (904) 247-0787 E-mail: michael.burtornasfanfec.com Page 3 (, Stantec PROFESSIONAL SERVICES TERMS AND CONDITIONS Page 1 of 2 The following Terms and Conditions are attached to and form part of a proposal for services to be performed by Consultant and together, when the CLIENT authorizes Consultant to proceed with the services, constitute the AGREEMENT. Consultant means the Stantec entity issuing the Proposal. DESCRIPTION OF WORK: Consultant shall render the services described in the Proposal (hereinafter caned the "SERVICES") to the CLIENT. DESCRIPTION OF CLIENT: The CLIENT confirms and agrees that the CLIENT has authority to enter into this AGREEMENT on its own behalf and on behalf of all parties reloted to the CLIENT who may have an interest in the PROJECT. TERMS AND CONDITIONS: No terms. conditions, understandings, or agreements purporting to modify or vary these Terms and Conditions shall be binding unless hereafter made in writing and signed by the CLIENT and Consultant. In the event of any conflict between the Proposal and these Terms and Conditions, these Terms and Conditions shall take precedence. This AGREEMENT supersedes 011 previous agreements, arrangements or understandings between the parties whether written or orol in connection with or incidental to the PROJECT. COMPENSATION: Payment is due to Consultant upon receipt of invoice and shall be paid as provided in Florida Statues §§218.70 et.seq. Local Government Prompt Payment Act. Failure to make any payment when due is a material breach of this AGREEMENT and will entitle Consultant, at its option, to suspend or terminate this AGREEMENT and the provision of the SERVICES. Unless otherwise noted, the fees in this agreement do not include any value added, sales, or other taxes that may be applied by Government on fees for services. Consultant understonds that CLIENT is a tax exempt entity. NOTICES: Each party shall designate a representative who is authorized to act on behalf of that party. All notices, consents, and approvals required to be given hereunder shall be in writing and shall be given to the representatives of each party. TERMINATION: Either party may terminate the AGREEMENT without cause upon thirty (30) days' notice in writing. if either party breaches the AGREEMENT and fails to remedy such breach within seven (7) days of notice to do so by the non -defaulting party, the non -defaulting party may immediately terminate the Agreement. Non-payment by the CLIENT of Consultant's invoices as provided in F.S.218.70 et.seq. is agreed to constitute a material breach and, upon written notice as prescribed above, the duties, obligations and responsibilities of Consultant are terminated. On termination by either party, the CLIENT shall forthwith pay Consultant all fees and charges for the SERVICES provided to the effective date of termination. PROFESSIONAL RESPONSIBIUTY: In performing the SERVICES, Consultant will provide and exercise the standard of care, skill and diligence required by customarily accepted professional practices normally provided in the performance of the SERVICES at the time and the location in which the SERVICES were performed. LIMITATION OF LIABILITY: The parties ogree that each will hold harmless or defend the other from and against all liabilities and expenses on account of the negligent acts of the negligent party's employees, servants. or agents in relation to this PROJECT. Each party shall be responsible for their own attorney's fees. Nothing contained herein shall be construed as o waiver of any immunity from or limitation of liability the CLIENT is entitled to under the doctrine of sovereign immunity or section 768.28, Florida Statutes. 11 is further ogreed that the total amount of all claims the CLIENT may have against Consultant under this AGREEMENT, including but not limited to claims for negligence, negligent misrepresentation and/or breach of contract, shall be strictly limited to the greater of professional fees paid to Consultant for the SERVICES or $50,000.00. No claim may be brought against Consultant more thon two (2) years after the cause of action arose. As the CLIENT's sole and exclusive remedy under this AGREEMENT any claim, demand or suit shall be directed and/or asserted only against Consultant and not against any of Consultant's employees. officers or directors. Consultant's liability with respect to any claims arising out of this AGREEMENT shall be absolutely limited to direct damages arising out of the SERVICES and Consultant shall bear no liability whatsoever for any consequential loss, injury or damage incurred by the CLIENT, including but not limited to claims for loss of use, loss of profits and/or loss of markets. DOCUMENTS: Subject to the requirement of Florida laws regarding public records all documents containing "trade secrets," as defined by Florida Statutes section 812.081(1) (c), which are produced or developed by the Consultant or any "trade secret" data available to the Consultant pursuant to this Agreement shall not be made available to any individual or organization, other thon any Consultant's Representative, without prior written consent from the CLIENT. If the CLIENT receives documents containing "trade secrets," then the CLIENT shall retain such documents pursuant to chapter 119, Florida Statutes. If trade secret information is provided and such documents are marked "confidential," then the CLIENT shall exempt such documents from public access and make such documents confidential. Any document produced by Consultant in relation to the Services is intended for the sole use of Client. The documents may not be relied upon by any other party without the express written consent of Consultant. which may be withheld at Consultant's discretion. Any such consent will provide no greater rights to the third party than those held by the Client under the contract, and will only be authorized pursuant to the conditions of Consultant's standard form reliance letter. Consultant cannot guarantee the authenticity. integrity or completeness of data files supplied in electronic format ("Electronic Files"). CLIENT shall release, indemnify and hold Consultant, its officers, employees, Consultant's and agents harmless from any claims or damages arising from the use of Electronic Files. Electronic files will not contain stamps or seals, remain the property of Consultant, are not to be used for any purpose other than that for which they were transmitted, and ore not to be retransmitted too third party without Consultant's written consent except as otherwise provided by F.S. 119. INSURANCE: Consultant shall procure and maintain throughout the term of this Agreement the following insurance with the limits set forth herein, and shall, upon executing this Agreement, provide to CLIENT a certificate(s) of insurance evidencing same, and showing CLIENT as on additional insured: Stantec PROFESSIONAL SERVICES TERMS AND CONDITIONS Page 2 of 2 A. Worker's Compensation Insurance as required by law. B. Unless otherwise provided for herein. Comprehensive General Liability Insurance including contractual liability and liability arising out of the use of automobiles with the following limits: (1) Bodily Injury Liability Insurance with limits of $1.000,000 per occurrence and $2.000,000 aggregate: (2) Property Damage Liability Insurance with o limit of $50,000 per occurrence. C. Unless otherwise provided for herein. Errors and Omissions Liability Insurance with a limit of $3,000,000 per claim and aggregate. GOVERNING LAW/COMPLIANCE WITH LAWS: This agreement shall be governed by and construed in accordance with the laws of the State of Horida. Venue for any dispute pertaining to this Agreement shall be in Pinellas County. Consultant shall observe and comply with all applicable laws, continue to provide equal employment opportunity to all qualified persons, and to recruit, hire, train, promote and compensate persons in all jobs without regard to race, color, religion, sex, age, disability or national origin or any other basis prohibited by applicable laws. DISPUTE RESOLUTION: In the event of a dispute, such dispute may be settled by appropriote legal proceeding or, if the Parties mutually agree in writing, through non-binding arbitration or administrative process. Pending any non-binding arbitrative or administrative decision, appeal, or judgment referred to in this Section or the settlement of any dispute arising under this Agreement, the Parties shall proceed diligently with the performance of this Agreement. Each party shall be responsible for its own costs and expenses, including legal fees, of any arbitration, administrative proceedings, appeal or suit prosecuted by either porty.. ASSIGNMENT: The CLIENT and Consultant shall not, without the prior written consent of the other party, assign the benefit or in any way transfer the obligations under these Terms and Conditions or any part hereof. SEVERABILITY: If any term. condition or covenant of the AGREEMENT is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions of the AGREEMENT shall be binding on the CLIENT and Consultant. FLORIDA CONTRACTS: PURSUANT TO FLORIDA STATUTES CHAPTER 558.0035 AN INDIVIDUAL EMPLOYEE OR AGENT MAY NOT BE HELD INDIVIDUALLY LIABLE FOR DAMAGES RESULTING FROM NEGLIGENCE. IF THE CONSULTANT HAS QUESTIONS REGARDING THE APPLICATION OF CHAPTER 119, FLORIDA STATUTES, TO THE CONSULTANT'S DUTY TO PROVIDE PUBLIC RECORDS RELATING TO THIS AGREEMENT, CONTACT THE CUSTODIAN OF PUBLIC RECORDS: ROSEMARIE CALL, CITY CLERK, 112 S. OSCEOLA AVE., CLEARWATER, FL 33756: (727) 562-4093: ROSEMARIE.CALL@MYCLEARWATER.COM. Consultant shall (1) keep and maintain public records (as defined in Chapter 119, Florida Statutes) required by the CLIENT to perform the services pursuant to this Agreement; (ii)Upon request from the City Clerk's Office, provide the CLIENT (at no cost to the CLIENT) with a copy of the requested records or allow the records to be inspected or copied within a reasonable time at a cost that does not exceed the cost provided under Florida laws regarding public records or other applicable Laws; (iii) ensure that public records in the Consultant's possession that are exempt or confidential and exempt from public records disclosure requirements are not disclosed except as authorized by applicable Laws for the Term and after the expiration or earlier termination of this Agreement: and (iv) after the expiration or earlier termination of this Agreement, at the CLIENT's request, either transfer. at no cost. to the CLIENT all public records in the Consultant's possession within ten (10) days following the CLIENT's request and/or keep and maintain any public records required by the CLIENT to perform the services pursuant to this Agreement. If the Consultant tronsfers all public records to the CLIENT upon the expiration or earlier termination of this Agreement. the Consultant shall destroy any duplicate public records that ore exempt or confidential and exempt from public records disclosure requirements. If the Consultant keeps and maintains public records upon the expiration or earlier termination of this Agreement, the Consultant shall meet all applicable requirements for retaining public records in accordance with this Agreement and all applicable Laws. At the CLIENT'S request, all public records stored electronically by the Consultant shall be provided to the CLIENT in a format approved by the CLIENT. Consultant shall retain one complete copy of any such records for archival purposes under the same conditions as set out herein