Agenda packet — Audit Committee, September 15, 2022

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www.modestogov.com

AMENDED AGENDA
City of Modesto

SPECIAL AUDIT COMMITTEE / COUNCIL WORKSHOP
Held Via Teleconference
(To Access Meeting Please See Instructions Below)
*Thursday, September 15, 2022 at 11:00 AM
*Roll Call: Sue Zwahlen, Chair
David Wright, Vice-Chair
Jenny Kenoyer, Member
Alternates: Rosa Escutia-Braaton, Tony Madrigal, Chris Ricci * Please Note: In order to respond to COVID-19, and pursuant to AB 361, the City will hold this meeting via teleconference and Committee Members will be calling in. “Wordly” can translate into 25+ different languages! To access written translation during the meeting, please scan the QR Code or click this link https://attend.wordly.ai/join/RJDY-6364.
"Wordly" puede traducir a más de 25 idiomas diferentes! Para acceder a la traducción durante la reunión, por favor escanee el código QR o haga clic en el enlace https://attend.wordly.ai/join/RJDY-6364.

THIS MEETING WILL NOT BE PHYSICALLY OPEN TO THE PUBLIC
In order to minimize the spread of the COVID-19 virus, this meeting will be conducted pursuant to AB 361, which amended the Brown Act’s teleconferencing provisions and will not be physically open to the public. You may observe and participate in the meeting via teleconference as indicated below.
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PARTICIPATING IN COMMITTEE MEETINGS IN CONFORMANCE
WITH AB 361
The City of Modesto is providing alternatives to observe and participate in Committee meetings.

If you wish to make either a general public comment or to comment on a specific agenda item, you may use one of the following options:

SUBMITTING COMMENTS BY E-MAIL
Written comments may be submitted via email to: [email protected] (include Agenda Item Number in the subject line). All comments will be shared with the Committee Members and placed in the record, but will not be read aloud during the meeting. Written comments must be received two hours before the meeting.

VIRTUAL PARTICIPATION BY ZOOM VIDEO

CONFERENCING AND TELEPHONE
Joining the Committee meeting via Zoom
The City of Modesto is now offering the ability to view and participate in Committee meetings via telephonic conferencing via “Zoom” video conferencing computer technology. The meeting may be accessed through the use of Zoom using the following options:
 Enter the following link into an Internet Browser
https://us02web.zoom.us/j/86945970570,
 Enter the following link into an Internet Browser https://zoom.us/ and using the Webinar ID 869 4597 0570
 Passcode 84326
To use Zoom, please visit: https://zoom.us/ and either sign-up for a free Zoom account or continue as a guest. Once you have downloaded the app onto your mobile device, joined from your web browser, or downloaded the Zoom software on your computer you will be ready for the upcoming Committee meeting.

Joining the Committee meeting via Telephone
If you don’t have a smart phone or computer to access the meeting via Zoom, you can participate by phone, by calling 1-877-853-5257 (Toll Free) or 1-888-475-4499 (Toll Free) and enter the Webinar ID 869 4597 0570 Passcode 84326
Providing Public Comment on Zoom and by Telephone
The Committee Chairman will request public comment during the Public Comment periods on the meeting agendas and during each Regular Calendar Item on the Committee Agenda. Once the Chairman has announced the public comment period, please do one of the following.

USING A COMPUTER OR SMART PHONE APP:
 Click on the “Raise Hand” feature in the webinar controls. This will notify City staff that you have raised your hand.
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 City staff will unmute your microphone when it is your turn to provide public comment.
 A prompt will appear to confirm you would like to be unmuted and then you will have three minutes to provide public comment.
 Once your public comment has ended, you will be muted again.

USING A REGULAR PHONE (not using a computer or smart phone APP):
 Dial *9 (star 9), this will notify City staff that you have “raised your hand” for public comment.
 City staff will unmute your microphone when it is your turn to provide public comment.
 You will hear “you are unmuted” and then you will have three minutes to provide public comment.
 Once your public comment has ended, you will be muted again.  If your phone is unmuted, and you are unable to be heard, the host may ask that you Dial *6 to toggle mute on/off in Zoom.

Additional Zoom resources/support
Please visit Zoom’s website support page on helpful tips to prepare for the meeting:
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Council has not delegated directive or final approval authority to the Committees. Committee actions are recommendations to the full City Council, not final decisions on an issue.

PUBLIC COMMENTS
Please refer to special public comment instructions above.

Three-minute time limit per speaker
Only interested persons in the audience may present these matters. Under State law, Committee Members may respond to matters being presented under this item only as follows:
a. Briefly respond to statements made or questions raised. b. Ask a question for clarification.
c. Provide a reference to staff or other resources for factual information. d. Request staff to report back at a subsequent meeting. e. Finally, a Committee Member or the Committee itself may take action to direct staff to place a matter of business on a future agenda.

NEW BUSINESS

1. Consider approving the Award of Proposal and Agreement for the Furnishing of External Auditing Services to Vasquez and Company LLC, Glendale, California, for a three year Agreement with two one-year extension options, for an estimated annual - 3 -
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cost of $142,228, and a total amount not to exceed $715,000 over five years; and forwarding to Council for approval. (Funding Source: General Fund, Housing Urban Development Funds, Utility Funds, Community Facility Districts, and Ceres-Modesto Industrial Fire District)
FINANCE DEPARTMENT; Cynthia Kline, 209-577-5412, [email protected]

MATTERS TOO LATE FOR THE AGENDA
These may be presented by members of the City Council and staff upon determination by a majority vote that an emergency exists, as defined by State law, or by a 2/3 vote that (1) there is a need to take immediate action, and (2) that the need for action came to the City’s attention after the agenda was posted.

ADJOURNMENT
Posted pursuant to Government Code Section 54954.2 on the bulletin board at Tenth Street Place on at by
date time signature
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CITY OF MODESTO

AUDIT COMMITTEE REPORT
DATE OF MEETING:

September 15, 2022
Date: August 1, 2022
TO: Audit Committee
Sue Zwalen, Chair
David Wright, Vice-Chair
Jenny Kenoyer, Member
THROUGH: Joseph P. Lopez, City Manager
FROM: DeAnna Christensen, Director of Finance
SUBJECT: External Auditing Services Agreement
CONTACT: Cynthia Kline, Purchasing Manager, (209) 577-5412; [email protected] DESCRIPTION:

Consider approving the Award of Proposal and Agreement for the Furnishing of External Auditing Services to Vasquez and Company LLC, Glendale, California, for a three (3) year Agreement with two (2) one-year extension options, for an estimated annual cost of $142,228, and a total amount not to exceed $715,000 over five (5) years; and forwarding to Council for approval. (Funding Source: General Fund, Housing Urban Development Funds, Utility Funds, Community Facility Districts, and Ceres-Modesto Industrial Fire District) STRATEGIC PLAN ELEMENT:

This item supports the City of Modesto 2020-2025 Strategic Plan focus of Governance and Service Delivery under Goal H: Achieve Financial Sustainability.

BACKGROUND:

Under Section 1306 of the Modesto City Charter requires the Council to employ independent auditors to perform an annual financial audit of the City to examine the financial records managed by City employees.

The City requests an external auditor to express an opinion on the fair presentation of its basic financial statements and schedule of expenditures from federal awards in conformity with generally accepted accounting principles, the provisions of the Federal Single Audit Act Amendments of 1996 and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). The auditor is required to express an opinion on the compliance for each major federal program as part of the single audit. The auditor will report any identified material weaknesses or significant deficiencies in internal control. #1..
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External Auditing Services Agreement

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The City is the financial administrator for five (5) joint power agencies/program audits and twelve (12) Community Facilities Districts and will require the financial statement compilation and express an opinion on the financial statements and programs for these funds. The five (5) joint power agencies and program audits include the following:
1) Tuolumne River Regional Park (TRRP)
2) Ceres-Modesto Industrial Fire Protection JPA
3) Measure L - Local Roads First Transportation Funding Measure 4) Local Transportation Funds (LTF) - Streets and Roads and Non-motorized funds under Transportation Development Act (TDA)
5) Abandoned Vehicle Abatement (AVA)
In addition, the City is required to file the Annual State Controllers Report Financial Transaction Report to the State of California to provide fiscal year financial data and statistical information.

This report is prepared by this audit firm as part of this agreement and reviewed by City staff.

DISCUSSION:

The City Manager authorized the Purchasing Manager to issue formal Request for Proposals (RFP) for the furnishing of external auditing services.

The Purchasing Division issued RFP No. 2122-40 for external auditing services on PlanetBids via the City’s website under nine (9) commodity codes1. Prospective proposers were notified online and via email of the bid opportunity. Twenty (20) chose to download the RFP document.

On April 26, 2022, proposals were formally opened by the City Clerk’s Office and broadcast via Microsoft Teams Livestream. Seven (7) companies chose to respond, none of which were local companies.

An evaluation committee comprised of five (5) City staff members which included Director of Finance, Accounting Manager, Senior Financial Analyst, Budget Financial Analyst, and Community Development Services Manager who evaluated the proposals and Mayor Sue Zwahlen (Chair of Audit Committee) was chosen to observe the RFP process. The evaluation was based on technical proposal, mandatory elements, expertise and experience, audit approach, and cost.

Based on being ranked highest in total evaluation criteria, the evaluation committee recommends the award of proposal for the external auditing services to Vasquez and Company LLC. Vasquez and Company LLC is certified as a minority business enterprise and small business enterprise in the State of California and provides a wide-range of diversity in their workforce.

Modesto Municipal Code Section 8-3.203 generally requires all purchases, which meet or exceed $50,000 for material, equipment or contractual services to be formally bid. The award of proposal for the furnishing of external auditing services to Vasquez and Company LLC, Glendale, California, conforms to Modesto Municipal Code 8-3.203. 1 91800 Consulting Services; 91804 Accounting/Auditing/Budget Consulting; 91806 Administrative Consulting; 91849 Finance/Economics Consulting; 91858 Governmental Consulting; 94600 Financial Services; 94620 Auditing; 96100 Miscellaneous Services, No. 1 (Not Otherwise Classified); 96200 Miscellaneous Services, No. 2 (Not Otherwise Classified) #1..
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External Auditing Services Agreement

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FISCAL IMPACT:

Sufficient funds are budgeted in Fiscal Year 2022-23 and will be budgeted for future years through the term of this agreement, to cover the cost for this service. The prior contract for auditing services with Hudson and Henderson was an estimated $147,110 to $148,400 per audit year which has been outlined below.

Fiscal Year
Audit Period Amount
2017-18 $ 147,110
2018-19 $ 147,110
2019-20 $ 147,845
2020-21 $ 147,845
2021-22 $ 148,400
Total $ 738,310
The new agreement with Vasquez and Company is estimated at an average annual cost of $142,228 through the term of the agreement. The first audit year the agreement will be $135,000 with a 2% increase annually through the term of the agreement. Comparing the firstyear amount to the current annual cost with Hudson and Henderson this will generate a savings of about $13,400 annually. The amount also includes an additional cost for up to three (3) new Community Facility District audits over the term of the agreement.

Funding Source
Year One
Amount
General Fund - Fund 0100 $ 81,200
Housing Urban Development Funds $ 4,900
Water Fund $ 11,800
Wastewater Fund $ 8,000
Storm Drain Fund $ 1,100
Community Facility Districts $ 18,000
Tuolumne River Regional Park Joint Power Agency (JPA) $ 5,000 Ceres-Modesto Industrial Fire JPA $ 5,000
Total $ 135,000
Approved by:

DeAnna Christensen, Director of Finance
Joseph P. Lopez, City Manager
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External Auditing Services Agreement

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Attachment:

1. Agreement

2. Exhibit A – Request for Proposal Auditing Services

3. Exhibit B – Vasquez Proposal

4. Exhibit C – Pricing Cost

5. Financial Interest Disclosure
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1 EXTERNAL AUDITING SERVICES
THIS AGREEMENT, made and entered into in the City of Modesto, State of California, this day of , 2022 (“Effective Date”), by and between the CITY OF MODESTO, a municipal corporation of the State of California, hereinafter referred to as "City", and VASQUEZ & COMPANY LLP, a California LLP, hereinafter referred to as "Consultant."
This Agreement is made with regard to the following recitals:

A. The City has determined that auditing services are needed to support the City of Modesto.

B. Consultant represents that it is qualified, willing and able to provide the services to prepare said document(s).

NOW, THEREFORE, in consideration of this agreement, and the mutual promises, covenants, and stipulations hereinafter contained, the parties agree as follows:

1. SCOPE OF SERVICES.

Consultant shall undertake and complete the preparation of the scope of work as set forth and described in the documents attached hereto and referred to as Exhibit "A" or "project". The Consultant shall perform the services as described in Exhibit "A" in a manner compatible with the standards of its profession, and shall produce a fully complete project that is acceptable to City.

2. TERM OF AGREEMENT.

The term of the contract shall be for a period of three (3) years, with two (2) one-year extension options at the sole discretion of City, for a total of up to five (5) years.

Pricing shall remain firm for the first three (3) years of any contract, which may be awarded pursuant to this RFP.
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2 Price increases for subsequent contract years four and five, shall not exceed the Consumer Price Index (CPI) for West Urban Area in any one contract year, and shall be negotiated through the Purchasing Division. Requests for price increases shall be submitted by Contractor(s) in writing, at least sixty (60) days prior to the annual anniversary date of the contract to be effective for the subsequent year.

City hereby gives Consultant notice to proceed with the preparation of the project in the manner described in Exhibit "A", as of the Effective Date of this agreement.

Consultant shall diligently proceed with the preparation of the project and agrees to complete said preparation within the time period set forth in Exhibit "A".

3. COMPENSATION.

Consultant agrees to accept a sum not to exceed $715,000 as full remuneration for performing all services and furnishing all staffing and materials called for in Exhibit "A" and for performance by Consultant of all of its duties and obligations under this Agreement.

The Compensation shall be paid pursuant in the manner and at the times set forth below:

All work to be performed under this Agreement shall be billed at the rates set forth in Exhibit “B” attached hereto, Consultant shall submit monthly invoices to City which include detailed tasks, hours worked, and billable rates for all work completed, and detailed receipts for any out-of-pocket, reimbursable costs paid by Consultant in connection with work performed on this project.

4. OBLIGATIONS OF CONSULTANT.

Throughout the term of this Agreement, Consultant shall possess, or secure all licenses, permits, qualifications and approvals legally required to conduct business. Consultant warrants that it has all of the necessary professional capabilities and experience, as well as all tools, #1..
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3 instrumentalities, facilities and other resources necessary to provide the City with the services contemplated by this Agreement. Consultant further warrants that it will follow the best current, generally accepted and professional practices to make findings, render opinions, prepare factual presentations, and provide professional advice and recommendations regarding this project.

5. PERFORMANCE BY KEY EMPLOYEE.

Consultant has represented to City that ELISA STILWELL, PARTNER, will be the person primarily responsible for the performance of the services referred to in this Agreement. City has entered into this Agreement in reliance on that representation by Consultant.

Consultant therefore agrees that SEVEN percent (7%) or more of the time to be devoted to the project that is the subject of this Agreement will be that of the above-named person.

6. OWNERSHIP OF DOCUMENTS/TITLE TO DATA.

Ownership of Documents
All reports, drawings, designs, graphics, working papers and other incidental work or materials furnished hereunder shall become and remain the property of the City, and may be used by City as it may require without any additional cost to City. No reports shall be used by the Consultant for purposes other than this contract without the express prior written consent of City.

The deliverables or audit working papers prepared in accordance with Auditing Standards shall not be subject to the provisions of this section where the section requirements are inconsistent with such Auditing Standards. In such case, the Auditing Standards shall prevail.

Title to Data
If, as a part of the agreement, Consultant is required to produce data such as, but not limited to, drawings, plans, specifications, calculations, models, flow diagrams, visual #1..
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4 aids and other related materials, the originals of all such data generated under this agreement will be delivered to City upon the completion or termination of services under the contract.

All materials, documents, data or information obtained from the City data files or any City medium furnished to Consultant in the performance of this Agreement will at all times remain the property of the City. Such data or information may not be used or copied for direct or indirect use by Consultant after termination of this Agreement without written consent of the City.

7. NEWS AND INFORMATION RELEASE.

Consultant agrees that it will not issue any news releases in connection with either the award of this Agreement, or any subsequent amendment of or efforts under this Agreement, without first obtaining review and approval of said news releases from City through the City Manager.

8. INTEREST OF CONTRACTOR.

Consultant agrees to file a Statement of Economic Interests with the City Clerk at the start and end of this contract if so required at the option of City.

9. AMENDMENTS.

Both parties to this Agreement understand that it may become desirable or necessary during the execution of this Agreement, for City or Consultant to modify the scope of services provided for under this Agreement. Any material extension or change in the scope of work shall be discussed with City and the change and cost shall be memorialized in a written amendment to the original contract prior to the performance of the additional work. #1..
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5 Until a change order is so executed, City will not be responsible to pay any charges Consultant may incur in performing such additional services, and Consultant shall not be required to perform any such additional services.

10. INDEPENDENT CONTRACTOR.

All acts of Consultant, its agents, officers, and employees and all others acting on behalf of Consultant relating to the performance of this Agreement, shall be performed as independent contractors and not as agents, officers, or employees of City. Consultant, by virtue of this Agreement, has no authority to bind or incur any obligation on behalf of City. Consultant has no authority or responsibility to exercise any rights or power vested in the City. No agent, officer, or employee of the City is to be considered an employee of Consultant. It is understood by both Consultant and City that this Agreement shall not under any circumstances be construed or considered to create an employer-employee relationship or a joint venture.

Consultant, its agents, officers and employees are and, at all times during the terms of this Agreement, shall represent and conduct themselves as independent contractors and not as employees of City.

Consultant shall determine the method, details and means of performing the work and services to be provided by Consultant under this Agreement. Consultant shall be responsible to City only for the requirements and results specified in this Agreement, and, except as expressly provided in this Agreement, shall not be subjected to City's control with respect to the physical action or activities of the Consultant in fulfillment of this Agreement. Consultant has control over the manner and means of performing the services under this Agreement. Consultant is permitted to provide services to others during the same period service is provided to City under this Agreement. If necessary, Consultant has the responsibility for employing other persons or firms to assist Consultant in fulfilling the terms and obligations under this Agreement. #1..
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6 If in the performance of this Agreement any third persons are employed by Consultant, such persons shall be entirely and exclusively under the direction, supervision, and control of Consultant. All terms of employment including hours, wages, working conditions, discipline, hiring, and discharging or any other term of employment or requirement of law shall be determined by the Consultant.

It is understood and agreed that as an independent contractor and not an employee of City neither the Consultant or Consultant's assigned personnel shall have any entitlement as a City employee, right to act on behalf of the City in any capacity whatsoever as an agent, or to bind the City to any obligation whatsoever.

It is further understood and agreed that Consultant must issue W-2 forms or other forms as required by law for income and employment tax purposes for all of Consultant's personnel.

As an independent contractor, Consultant hereby indemnifies and holds City harmless from any and all claims that may be made against City based upon any contention by any third party that an employer-employee relationship exists by reason of this Agreement.

11. ASSIGNMENT.

Neither this Agreement nor any portion thereof shall be subcontracted or assigned without the express prior written consent of the City in each and every instance.

12. PATENT/COPYRIGHT MATERIALS.

Unless otherwise expressly provided in the contract, Consultant shall be solely responsible for obtaining the right to use any patented or copyrighted materials in the performance of this Agreement. Consultant shall furnish a warranty of such right to use to City at the request of City.

13. NOTICES.
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7 Any and all notices permitted or required to be given hereunder shall be deemed duly given and effective (a) upon actual delivery, if delivery is by hand; or (b) five (5) days after delivery into the United States mail if delivery is by postage paid registered or certified (return receipt requested) mail. Each such notice shall be sent to the parties at the address respectively indicated below or to any other address as the respective parties may designate from time to time.

FOR Consultant:

Name: VASQUEZ & COMPANY LLP
Address: 655 NORTH CENTRAL AVE., SUITE 1550,
GLENDALE, CA 91203
Attention: ROGER MARTINEZ
Phone: (213) 873-1703
FOR CITY:

Name: CITY OF MODESTO, PURCHASING DIVISION
Address: 1010 10th STREET, SUITE 5200
MODESTO, CA 95354
Attention: DIANNE LOVE
Phone: (209)571-5164

14. INSURANCE REQUIREMENTS.

The Consultant shall provide at its own expense and maintain at all times the following insurance with insurance companies licensed in the State of California and shall provide evidence of such insurance to the City as may be required by the Risk Manager of the City. The policies or certificates thereof shall provide that, thirty (30) days prior to cancellation or material change in the policy, notices of same shall be given to the Risk Manager of the City by certified mail, return receipt requested, for all of the following stated insurance policies. (a) Worker's Compensation - in compliance with the statutes of the State of California, plus employer's liability with a minimum limit of liability of $1,000,000. (b) General Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and $1,000,000 for property damage or $1,000,000 #1..
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8 combined single limit. If commercial general liability insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required per-occurrence limit.

This insurance shall indicate on the certificate of insurance the following coverages and indicate the policy aggregate limit applying to: premises and operations; broad form contractual; independent consultants and subcontractors; products and completed operations. (c) Automobile Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and $1,000,000 property damage or $1,000,000 combined single limit. This insurance shall cover any automobile for bodily injury and property damage.
(d) Professional Liability (Errors and Omissions) Insurance with limits not less than $2,000,000 per claim, $4,000,000 aggregate. If coverage is on a claims-made basis it shall be maintained for at least three (3) years following completion of the work.

If at any time any of said policies shall be unsatisfactory to the City, as to form or substance, or if a company issuing such policy shall be unsatisfactory to the City, the Consultant shall promptly obtain a new policy, submit the same to the Risk Manager for approval and submit a certificate thereof as hereinabove provided. Upon failure of the Consultant to furnish, deliver or maintain such insurance and certificates as above provided, this Agreement, at the election of the City, may be forthwith declared suspended or terminated. Failure of the Consultant to obtain and/or maintain any required insurance shall not relieve the Consultant from any liability under this Agreement, nor shall the insurance requirements be construed to conflict with or otherwise limit the obligations of the Consultant concerning indemnification. The City, its agents, officers, employees, and volunteers shall be named as an additional insured on all insurance policies required herein, except Workers' Compensation and Professional Liability. CONSULTANT shall provide CITY with separate endorsements evidencing proof of the CITY’s additional insured #1..
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9 status as to both the general liability and automobile liability insurance policies. The Workers' Compensation insurer shall agree to waive all rights of subrogation against the City, its agents, officers, employees, and volunteers for losses arising from work performed by Consultant for the City. In addition, CONSULTANT shall provide CITY with a Workers Compensation subrogation waiver by way of a separate endorsement. The Consultant's insurance policy(ies) shall include a provision that the coverage is primary as respects the City; shall include no special limitations to coverage provided to additional insured; and, shall be placed with insurer(s) with acceptable Best's rating of A:VII or with approval of the Risk Manager. The Consultant must deliver certificates evidencing existence of the insurance listed above to the City prior to the time the contract is signed.

All endorsements referenced above must include the applicable policy number.

15. TERMINATION OF AGREEMENT.

For the purposes of this section, material breach of this Agreement shall include, but not be limited to, any of the following: failure to perform required services or duties, willful destruction of City's property by Consultant, dishonesty or theft.

Termination by City for Convenience
The City may also terminate the Consultant's performance under the Agreement, either in whole or in part, at its own discretion, or when conditions encountered during the Work make it impossible or impracticable to proceed, or when the City is prevented from proceeding with the Agreement by act of God, by law, or by official action of a public authority, or upon a determination by the City #1..
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10 that such termination is in the best interest and convenience of the City, or whenever the City is prohibited from completing the Work for any reason. The City shall provide no less than ten (10) calendar days written notice of its intent to terminate the Agreement for convenience, and shall endeavor to provide the Consultant with consultation with the City prior to termination.

Termination by City for Lack of Budgeted Funds
The City may terminate this Agreement effective July 1 of any given year upon the City's determination to not appropriate sufficient funds for this Agreement for the ensuing fiscal year. In such event City shall give Consultant not less than 30 days written notice of termination.

Termination by City for Change of Consultant's Tax Status If City determines that Consultant does not meet the requirements of federal and state tax laws for independent contractor status, City may terminate this Agreement by giving written notice to Consultant. The termination date shall be the effective date of the notice.

City will pay Consultant an amount based on the percentage of satisfactory work completed in accordance with the notice of termination. If the Agreement is terminated pursuant to the subparagraph entitled Termination by City for Default of Consultant, Consultant #1..
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12 understands and agrees that City may, in City's sole discretion, refuse to pay Consultant for that portion of Consultant's services which were performed by Consultant on the project prior to the termination date and which remain unacceptable and/or not useful to City as of the termination date. The final payment to the Consultant after termination for convenience shall be limited to amounts due and owing under the Agreement at time of termination, including the following:
a. The cost of settling and paying valid claims arising out of the termination of the Work such as subconsultant agreements or contracts for materials;
b. The Agreement price allocable to the portion of the Work properly performed or goods supplied to the work site by the Consultant as of the date of termination, as determined in accordance with the notice of termination, reduced by any sums previously paid to the Consultant.

16. CERTIFIED PAYROLL REQUIREMENT.

For consultants performing field work on public works contracts on which prevailing wages are required: The Consultant shall comply with the provisions of Section 1776 of the California Labor Code, regarding payroll records, and shall require its subconsultants and subcontractors to comply with that section as may be required by law.

17. INDEMNITY.

The Consultant shall hold the City, its agents, officers, employees, and volunteers, harmless from and save, defend and indemnify them against any and all claims, losses, liabilities, judgments or damages from every cause, including but not limited to injury to person or property or wrongful death, including reasonable costs and expenses of defense of any judicial or administrative action, arising directly or indirectly out of any act or omission of Consultant. #1..
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13 Consultant's obligation to defend, indemnify, and hold the City, its agents, officers, and employees harmless under the provisions of this paragraph is not limited to or restricted by any requirement in this Agreement for Consultant to procure and maintain a policy of insurance.

18. ENTIRE AGREEMENT.

This Agreement and its exhibits contain the entire understanding between Consultant and City. Additional or new terms contained in this Agreement which vary from Consultant's proposal are controlling and are deemed accepted by Consultant by shipment of any article or other commencement of performance hereunder. All previous proposals, offers and communications relative to this Agreement, whether oral or written, are hereby superseded except to the extent that they have been incorporated into this Agreement. No future waiver of or exception to any of the terms, conditions, and provisions of this Agreement shall be considered valid unless specifically agreed to in writing by all the parties.

19. PARTIAL INVALIDITY.

If any provision in this Agreement is held by a court of competent jurisdiction to be invalid, void, or unenforceable, the remaining provisions shall nevertheless continue in full force without being impaired or invalidated in any way.

20. WAIVER.

The waiver by any party to this Agreement of a breach of any provision hereof shall be in writing and shall not operate or be construed as a waiver of any other or subsequent breach hereof unless specifically stated in writing.

21. AUDIT.

The City's duly authorized representative shall have access at all reasonable times to all reports, contract records, contract documents, contract files, and personnel necessary to audit and verify Consultant's charges to City under this Agreement. #1..
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14 Consultant agrees to retain reports, records, documents, and files related to charges under this Agreement for a period of four (4) years following the date of final payment for Consultant services. City's representative shall have the right to reproduce any of the aforesaid documents.

22. GOVERNING LAW.

This Agreement shall be governed according to the laws of the State of California.

23. HEADINGS NOT CONTROLLING.

Headings used in the Agreement are for reference purposes only and shall not be considered in construing this Agreement.

24. COMPLIANCE WITH LAWS.

Consultant shall insure compliance with all safety and hourly requirements for employees, in accordance with federal, state, and county safety and health regulations and laws.

Consultant shall fully comply with all applicable federal, state, and local laws, ordinances, regulations and permits.

25. CITY BUSINESS LICENSE.

Consultant shall have a City of Modesto business license. #1..
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15 IN WITNESS WHEREOF, the City of Modesto, a municipal corporation, has authorized the execution of this Agreement in duplicate by its City Manager and attestation by its City Clerk under authority of Resolution No. 2022- , adopted by the Council of the City of Modesto on the day of , 2022, and Vasquez & Company LLP has caused this agreement to be duly executed as of the Effective Date. #1..
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1 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40
FOR

EXTERNAL AUDITING SERVICES
PROPOSAL OPENING: APRIL 26, 2022 at 11:00 A.M.

CITY OF MODESTO CONTACT: Dianne Love, Senior Buyer
E-MAIL ADDRESS: [email protected]
PHONE: (209)571-5164
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2 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

TABLE OF CONTENTS
Page
. Notice to Proposers ..............................................................................................................3 . City Contacts ........................................................................................................................4 . Calendar of Events ...............................................................................................................4 . Offer and Acceptance...........................................................................................................4 FORMS
. Proposal Acknowledgement (Signature Form).................................................................6 . Pricing Schedule (Signature Form) ...................................................................................7 . Exceptions, Clarifications, Amendments ............................................................................9 . References ..........................................................................................................................10 . Financial Interest Disclosure..............................................................................................12 . Company History Statement..............................................................................................15 . Minimum Qualifications....................................................................................................15 Technical Specifications and Requirements
. Background.........................................................................................................................18 . Technical Specifications ....................................................................................................17 . Proposal Evaluation Criteria ..............................................................................................17 . Insurance Requirements.....................................................................................................25 General Terms and Conditions
. Proposal Submittal .............................................................................................................31 . Acceptance/Rejection of Irregular Proposals ....................................................................31 . Complete Proposal Document ...........................................................................................32 . Compliance / Non-Compliance .........................................................................................32 . Pricing Format....................................................................................................................32 . Pricing Schedule.................................................................................................................32 . Award of Proposal..............................................................................................................33 . Evaluation Process .............................................................................................................33 . Term of Contract ................................................................................................................33 . Termination of Services .....................................................................................................34 . Payment ..............................................................................................................................34 . Sample Agreement .............................................................................................................42 #1..
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3 NOTICE TO PROPOSERS
NOTICE IS HEREBY GIVEN that the City of Modesto, County of Stanislaus, State of California, will receive at the City Clerk’s office, 1010 Tenth Street, Suite 6600, Modesto, CA 95354 sealed proposals for the furnishing of External Auditing Services for the City of Modesto, Finance Department.

All equipment, materials, and supplies shall be furnished F.O.B. City of Modesto. Proposals shall be submitted on the proposal sheet and shall be downloaded from the City’s Purchasing website at http://www.modestogov.com/257/Contracting-Bid-Opportunities; such proposals shall include all necessary specifications. It is highly recommended all proposal documents be downloaded from the City’s website.

Each proposal shall be sealed and filed with the City Clerk’s office, 1010 Tenth Street, Suite 6600, Modesto, CA 95354 no later than Tuesday, April 26, 2022 at 11:00 A.M., at which time proposals will be opened and recorded. All proposals shall be available for review following City Council award approval at the Purchasing Division, 1010 Tenth Street, 5th Floor, Suite 5300, Modesto, CA 95354.

Proposals will be received only at the address shown above, and prior to the time indicated. Any proposal received at or after said time and/or date, or at a place other than the stated address cannot be considered and will be returned to the proposer unopened.

All proposals, whether delivered by an employee of the proposer, U.S. Postal Service, courier or package delivery service must be received and time stamped at the stated address prior to the time designated. The City Clerk’s time stamp shall be considered the official timepiece for the purpose of establishing the actual receipt of proposals. The City of Modesto assumes no responsibility for delay in the delivery of the proposal.

On the outside of both the proposal envelope and courier envelope, the proposer shall indicate the following:

NAME AND ADDRESS OF PROPOSER
SPECIFICATION NUMBER 2122-40

EXTERNAL AUDITING SERVICES
PROPOSAL OPENING DATE: APRIL 26, 2022 AT 11:00 A.M.

MAIL TO: CITY CLERK COURIER TO: CITY CLERK

CITY OF MODESTO CITY OF MODESTO
P.O. BOX 642 1010 10TH STREET, SUITE 6600
MODESTO, CA 95353 MODESTO, CA 95354
The City reserves the right to reject any or all proposals or to waive any informalities or minor irregularities in a proposal.

No proposer may withdraw his/her proposal for a period of one-hundred twenty (120) days after the date set for the opening thereof.
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4 CITY CONTACTS
All questions regarding these specifications, terms, and conditions shall be submitted in writing to Dianne Love, Senior Buyer, via email at [email protected].

All contacts during the proposal process shall be through the Purchasing Division. Attempts by the proposer to contact department representatives may result in disqualification of the proposer from the proposal process.

CALENDAR OF EVENTS
Event Date
Proposal Issued March 25, 2022
Written Questions Due April 4, 2022
Addendum Issued (if required) March 12, 2022
Response Due BEFORE 11:00 A.M. on Tuesday, April 26, 2022 Proposal Award Date June 2022
Note: Award date is approximate.

Note: Deliver or mail proposals to the referenced address, only, as indicated in the Notice to proposers.

It is the responsibility of each proposer to be familiar with all of the specifications, terms and conditions and the site condition (if applicable). The proposer agrees and acknowledges all RFP specifications, terms, and conditions and indicates the ability to perform by submission of a proposal. By the submission of a proposal, the proposer certifies that if awarded a contract they will make no claim against the City based upon ignorance of conditions or misunderstanding of the specifications.

OFFER AND ACCEPTANCE:

Seller represents his/her acceptance to provide products and/or services as follows. City's offer to purchase products and/or services is expressly conditioned upon Seller's assent to the terms and conditions set forth in City purchase order or contract documents, specifications, supporting data, and these articles. Seller agrees that Seller's Order Acknowledgement terms and conditions received prior to, during, or after order placement by City are hereby rejected. City purchase orders signed by the City's Purchasing Manager or her designated agent and issued to Seller or agreement constitutes written notification to Seller of City's rejection of any and all of Seller Order Acknowledgements, counter offers and change to the City's terms and conditions.
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5 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES

PROPOSAL SUBMITTAL CHECKLIST
The bidder shall provide a complete bid in a sealed envelope before 11:00 A.M. on the bid opening date.

Failure to provide all the required documents may cause the bid to be considered non-responsive.

NAME OF BID
COMPLETE BID Page No.
. Proposal Acknowledgement (Signature)............................................................................6 . Pricing Schedule (Signature)..............................................................................................7 . Exceptions, Clarifications, Amendments (if applicable) ....................................................9 . References ..........................................................................................................................10 . Financial Interest Disclosure Form (Pg. 13 if applicable) ...............................................12 . Company History Statement .............................................................................................15 . Addenda Acknowledgement Page (if applicable) ............................................................16 . Specification/Technical Response .................................................................................N/A #1..
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6 PROPOSAL ACKNOWLEDGEMENT
REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES
The City is soliciting proposals from qualified proposers to furnish its requirements per the specifications, terms and conditions contained in the above referenced proposal number. This Proposal Acknowledgement must be completed, signed by a responsible officer or employee, dated and submitted with the proposal response. Obligations assumed by such signature must be fulfilled.

1. Preparation of Proposals: (a) All prices and notations must be printed in ink or typewritten. No erasures permitted. Errors may be crossed out and corrections printed in ink or typewritten adjacent and must be initialed in ink by person signing the proposal. (b) Quote price as specified in proposal. No alterations or changes of any kind shall be permitted to the Proposal Form. Responses that do not comply shall be subject to rejection in total.

2. Failure to Submit Proposal: If you are not submitting a proposal but want to remain on the mailing list and receive future proposals, complete, sign and return this Proposal Acknowledgement and state the reason you are not pricing.

3. Taxes and Freight Charges: (a) Unless otherwise required and specified in the RFP, the prices quoted herein do not include Sales, Use or other taxes. (b) No charge for delivery, drayage, express, parcel post packing, cartage, insurance, license fees, permits, costs of bonds, or for any other purpose, except taxes legally payable by City, will be paid by the City unless expressly included and itemized in the proposal. (c) Amount paid for transportation of property to the City is exempt from Federal Transportation Tax. An exemption certificate is not required where the shipping paper shows the consignee as one (1) of the Agencies; as such papers may be accepted by the carrier as proof of the exempt character of the shipment. (d) Articles sold to the Agencies are exempt from certain Federal excise taxes. The Agencies will furnish an exemption certificate.

4. Award: (a) Unless otherwise specified by the proposer or the RFP gives notice of an all-or-none award, the City may accept any item or group of items of any proposal. (b) Proposals are subject to acceptance at any time within thirty (30) days of opening, unless otherwise specified in the RFP. (c) A valid, written purchase order mailed, or otherwise furnished, to the successful proposer within the time for acceptance specified results in a binding contract without further action by either party. The contract shall be interpreted, construed and given effect in all respects according to the laws of the State of California.

5. Patent Indemnity: Proposers who do business with the City shall hold the City, its officers, agents and employees, harmless from liability of any nature or kind, including cost and expenses, for infringement or use of any patent, copyright or other proprietary right, secret process, patented or un-patented invention, article or appliance furnished or used in connection with the contract or purchase order.

6. Samples: Samples of items, when required, shall be furnished free of expense to the City and if not destroyed by test may upon request (made when the sample is furnished), be returned at the proposer’s expense.

7. Rights and Remedies of Agencies for Default: (a) In the event any item furnished by the proposer in the performance of the contract or purchase order should fail to conform to the specifications therefore or to the sample submitted by the proposer with its proposal, the City may reject the same, and it shall thereupon become the duty of the proposer to reclaim and remove the same forthwith, without expense to the City, and immediately to replace all such rejected items with others conforming to such specifications or samples; provided that should the proposer fail, neglect or refuse so to do the City shall thereupon have the right to purchase in the open market, in lieu thereof, a corresponding quantity of any such items and to deduct from any moneys due or that may there after come due to vendor the difference between the prices named in the contract or purchase order and the actual cost thereof to the City. In the event that the proposer fails to make prompt delivery as specified for any item, the same conditions as to the rights of the City to purchase in the open market and to reimbursement set forth above shall apply, except when delivery is delayed by fire, strike, freight embargo, or Act of God or the government. (b) Cost of inspection or deliveries or offers for delivery, which do not meet specifications, will be borne by the proposer. (c) The rights and remedies of the Agencies provided above shall not be exclusive and are in addition to any other rights and remedies provided by law or under the contract.

8. Discounts: (a) Terms of less than ten (10) days for cash discount will be considered as net. (b) In connection with any discount offered, time will be computed from date of complete, satisfactory delivery of the supplies, equipment or services specified in the RFP, or from date correct invoices are received by the City at the billing address specified, if the latter date is later than the date of delivery. Payment is deemed to be made, for the purpose of earning the discount, on the date of mailing the City’s check.

9. California Government Code Section 4552: In submitting a proposal to a public purchasing body, the proposer offers and agrees that if the proposal is accepted, it will assign to the purchasing body all rights, title, and interest in and to all causes of action it may have under Section 4 of the Clayton Act (15 U.S.C. Sec. 15) or under the Cartwright Act (Chapter 2, commencing with Section 16700, of Part 2 of Division 7 of the Business and Professions Code), arising from purchases of goods, materials, or services by the proposer for sale to the purchasing body pursuant to the proposal. Such assignment shall be made and become effective at the time the purchasing body tenders final payment to the proposer.

10. No Guarantee or Warranty: The City makes no guarantee or warranty as to the condition, completeness or safety of any material or equipment that may be traded in on this order.

11. Two “Inked” Signed Original Proposal Document Requested: Failure to furnish at least one “inked” signed original proposal document may result in disqualification.

THE undersigned acknowledges receipt of the referenced RFP and/or Addenda and offers and agrees to furnish the articles and/or services specified on behalf of the proposer indicated below, in accordance with the specifications, terms and conditions of this RFP and Proposal Acknowledgement, for the pricing indicated on the Pricing Schedule.

Firm:
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7 Address:

City/State/Zip:

Signature/Title/Date:
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8 PRICING SCHEDULE
REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES
Total All-Inclusive Maximum Price for combined Fiscal Years 2022/23, 2023/24 and 2024/25 shall be used for cost evaluation
Total All-Inclusive Maximum Price
Item Fiscal Year 2022-23 Fiscal Year 2023/24 Fiscal Year 2024/25 Basic
Financial
Statements
(Audits and
Reports)
$________________________ $________________________ $________________________ Single Audit
and
Management
Letter
$________________________ $________________________ $________________________ TOTAL: $________________________ $________________________ $________________________ Detail Schedule of Professional Fees and Expenses for Fiscal 2022/23 ONLY Item Hourly Rate Total Hours TOTAL
Basic
Financial
Statements
Partners $________________________ $________________________ $________________________ Specialists $________________________ $________________________ $________________________ Supervisory $________________________ $________________________ $________________________ Staff $________________________ $________________________ $________________________ Out-ofPocket
(Misc.)
$________________________ $________________________ $________________________ TOTAL Fiscal Year 2022/23: $________________________
Detail Schedule of Professional Fees and Expenses for Fiscal 2022/23 ONLY Item Hourly Rate Total Hours TOTAL
Single Audit
and
Management
Letter
Partners $________________________ $________________________ $________________________ Specialists $________________________ $________________________ $________________________ Supervisory $________________________ $________________________ $________________________ Staff $________________________ $________________________ $________________________ Out-ofPocket
(Misc.)
$________________________ $________________________ $________________________ TOTAL Fiscal Year 2022/23: $________________________
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9 Will proposer accept the City’s Epay Payment Program? Please check one: Yes ____ No ____ Information regarding the program is provided in Section 2.15 Payment.

City Business License No. __________ Expiration Date: __________ THE undersigned acknowledges receipt of the referenced RFP and/or Addenda and offers and agrees to furnish the articles and/or services specified on behalf of the proposer indicated below, in accordance with the specifications, terms and conditions of this RFP and Proposal Acknowledgement, for the pricing indicated on the Pricing Schedule.

Company Name (Proposer):

By (Person Submitting Proposal): (Print)
By (Person Submitting Proposal): (Signature)
Title of Person Submitting Proposal:

Business Address
(City/State/Zip):

Email Address:

Telephone Number:

Fax Number:

Date:
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10 EXCEPTIONS, CLARIFICATIONS, AMENDMENTS
REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES
Exceptions, Clarifications, Amendments
List requests for proposal clarifications and exceptions below, if any, sign and submit with your proposal response.

Item No. Reference To: Description
Page No. Paragraph No.

Company Name (Proposer):
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11 REFERENCES
REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES
All proposers must provide a list of five (5) current or former clients in the area provided below, identifying prior experience with the same type of services requested by the City under Scope of Work.

References shall have similar volume and requirements to those outlined in these specifications, terms and conditions. Proposer’s failing to provide references shall be deemed unacceptable.

The City may contact some or all of the references provided in order to determine the Proposers’ performance record on services similar to that described in this proposal. The City reserves the right to contact references other than those provided in the response and to use the information gained from them in the award process.

Company Name:

Address:

City, State, Zip Code:

Contact Person:

Email Address:

Telephone Number:

Type of Business:

Date of Service:

Annual Contract Value $
Company Name:

Address:

City, State, Zip Code:

Contact Person:

Email Address:

Telephone Number:

Type of Business:

Date of Service:

Annual Contract Value $
Company Name:

Address:

City, State, Zip Code
Contact Person:

Email Address:

Telephone Number:

Type of Business:

Date of Service:

Annual Contract Value $
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12 Company Name:

Address:

City, State, Zip Code
Contact Person:

Email Address:

Telephone Number:

Type of Business:

Date of Service:

Annual Contract Value $
Company Name:

Address:

City, State, Zip Code
Contact Person:

Email Address:

Telephone Number:

Type of Business:

Date of Service:

Annual Contract Value $
Company Name (Proposer):
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13 FINANCIAL INTEREST DISCLOSURE
REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES

FINANCIAL INTEREST DISCLOSURE

REQUIRED DISCLOSURE BEGINNING THE COUNCIL MEETING
OF JANUARY 7, 2003
The ordinance requiring financial interest disclosure by all parties having a direct or indirect interest of $2,000 or more (except for certain publicly traded companies) will be effective at the Council meeting of January 7, 2003. This means that any Council action on a contract, agreement or development right must be accompanied by a FINANCIAL INTEREST DISCLOSURE FORM listing by name all parties that have a material financial interest in the agreement, contract or development right.

PLEASE NOTE, any Council action that requires a FINANCIAL INTEREST DISCLOSURE cannot be considered by the City Council until the required reporting is made. That means that Agenda Items without the DISCLOSURE will be removed from the Council Agenda.

FinDisclosure12-19
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14 FINANCIAL INTEREST DISCLOSURE
All persons included within the meaning of either of the following tests have a material financial interest in an agreement, or application for development rights, submitted for approval or disapproval by the City Council, and shall be identified by the applicant, by name.

Tests of Materiality:

1. Whether it is foreseeable to a reasonable person that the value of their interest in property available for use by an applicant, or their interest in the applicant itself, may increase or decrease by an amount greater than $2,000.00 as a direct or indirect result of Council action on the applicant’s agreement or application for development rights.

2. Whether it is foreseeable to a reasonable person that the person’s gross income from the applicant may increase or decrease by a sum greater than $2,000.00 as a direct or indirect result of Council action on the agreement or application for development rights.

It is the legal obligation of all applicants for approval of an agreement or of an application for development rights to verify in writing, under penalty of perjury, that the identity of each person having a material financial interest in the agreement or application or development rights is true, correct and complete.

The applicant understands that this information is provided under penalty of perjury, and that intentionally supplying misinformation or deception may result in either invalidation of the agreement or application, or criminal prosecution for misdemeanor violation of the Modesto Municipal Code, or both. Negligent provision of misinformation shall be grounds for invalidation. In accordance with the Modesto Municipal Code, each applicant has a continuing obligation to maintain the truth, accuracy and completeness of the financial interest disclosure information provided below until after final consideration by the City Council of any matter arising out of or relating to the agreement or application.

By signing this document I agree to the information contained within.

COMPANY NAME: ____________________________________________________ __________________________________
APPLICANT’S NAME (SIGNATURE):
__________________________________
APPLICANT’S NAME/TITLE (PRINT):
__________________________________
Applicable Names: DATE:
(See attached list)
Questions concerning the application of either test to particular facts should be resolved in advance of Council action by agreement with the department head recommending approval of its agreement/application.

DIRECTOR
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15 FINANCIAL INTEREST DISCLOSURE
COMPANY NAME: __________________________________________ NAMES
Signature / Print:

Signature / Print:

Signature / Print:
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16 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES

COMPANY HISTORY STATEMENT
Your company shall have been in business for a minimum of three (3) continuous years (immediately prior to the time of the RFP submittal date) providing the types of services requested in this RFP.

The company history statement shall be prepared on company letterhead and provided with the proposal submittal.

MINIMUM QUALIFICATIONS
Minimum Qualifications are mandatory for proposal consideration, and at a minimum shall include the following:

Financial Stability (Provided in a sealed separate envelope):

Proposers shall submit a copy of their company’s most recent professionally prepared Financial Statements (Income Statement and Balance Sheet). These statements, if unaudited, shall be accompanied by a cover letter that states the name and title of the preparer, the basis of the financial statement presentation (cash or accrual) and whether these statements have been prepared in accordance with Generally Accepted Accounting Principles for the most recent fiscal year end of the proposer. Audited financial statements shall be submitted in their entirety, including the auditor’s opinion and notes to the financial statements.

A separate document shall be provided and signed under penalty of perjury by the proposer’s financial officer or owner that explains the proposer’s inability to provide statements for a fiscal period that ended at least eight (8) months before the required date of submittal, if such inability exists.

One complete set of Financial Statements shall be submitted in a sealed separate envelope filed with the (original proposal document), marked with the following:

FINANCIAL STATEMENTS

NAME AND ADDRESS OF PROPOSER
SPECIFICATION NO. 2122-40

EXTERNAL AUDITING SERVICES
PROPOSAL OPENING DATE: APRIL 26, 2022 AT 11:00 A.M.
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17 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES

ADDENDA ACKNOWLEDGEMENT
The bidder shall check the RFB listing on the City or PlanetBid website, periodically, and in any event, no later than the day prior to bid opening to obtain any addenda information. The changes identified in the addenda modify this request for bid and specifications. The addenda now become a part of this request for bid and specifications. Signing the Bid on the signature portion thereof, the bidder is acknowledging that the bidder has confirmed that he or she has received all addenda issued for this request for bid and specifications, and has included costs for such in the bid submitted. Failure to list and acknowledge all addenda numbers may cause the bid to be considered nonresponsive. Do not attach any of the addenda to this sheet nor include them with the bid.

This document is only required to be returned should addenda have been issued.

The Bid is submitted with respect to the changes to the request for bid and specifications included in addenda numbers:

LIST ALL ADDENDA
NUMBERS:_____________________________________________________ Company Name (Bidder):
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18 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES
Most of the material needed to present a comprehensive proposal can be placed into one of the sections listed. Responses should be complete and detailed. However, if relevant information needs to be presented to further support the proposer’s case other appropriate sections may be added.

EVALUATION
All responsive proposals submitted will be reviewed by a City of Modesto evaluation committee.

At the completion of the proposal review, finalists may be asked to provide an in-depth presentation and product demonstration in Modesto. Whether or not a presentation shall be performed is wholly within the discretion of the evaluation committee. The committee will select the proposal which best fulfills the City’s requirements and represents the best value to the City of Modesto as determined by the evaluation committee. No single factor will determine the final award decision.

Overall responsiveness to the Request for Proposals is an important factor in the evaluation process.

EVALUATION CRITERIA

1. TECHNICAL PROPOSAL

2. EXPERTISE AND EXPERIENCE

3. AUDIT APPROACH

4. COST

5. MANDATORY ELEMENTS

6. REFERENCES (Minimum of 5)
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19 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES

TECHNICAL SPECIFICATIONS AND GENERAL REQUIREMENTS

1.0 BACKGROUND:

The City of Modesto is the County seat and largest City in Stanislaus County with a population of approximately 219,294 persons. The City encompasses a total incorporated area of 37 square miles and a total General Plan area of 66.7 square miles and is located on State Route 99, which links it to other Central Valley cities, including Sacramento (82 miles north), Stockton (32 miles north), and Fresno (96 miles south). Rail service links Modesto to the greater region. Passenger service is available outside of Downtown Modesto at the Burlington Northern/Santa Fe Railroad’s (Amtrak) Lakewood East Station, in eastern Modesto. Modesto is also located adjacent to the Tuolumne River, which flows out of Yosemite National Park. The Tuolumne River Regional Park includes a parkway along the river. In combination with Dry Creek Regional Park, the City has extensive river access and excellent recreational opportunities, both regionally and locally.

Modesto is a charter city with a Council-Manager form of government. The City’s operating budget for Fiscal Year 2021/22 is approximately $478 million and approximately 1,188 active permanent employees.

The City of Modesto accounting, financial reporting and investing functions are centralized in the Finance Department. The City's main financial applications operate on Oracle, and are networked to users via PC/terminal emulation.

1.1 GENERAL REQUIREMENTS:

The City of Modesto is requesting proposals from qualified Certified Public Accountants to conduct the annual independent audit of the City’s financial statements for Fiscal Years ending June 30, 2023, 2024 and 2025, with an option to renew for Fiscal Years ending June 30, 2026 and 2027, at the sole discretion of the City.

The City desires the external auditor to express an opinion on the fair presentation of its basic financial statements and schedule of expenditures from federal awards in conformity with generally accepted accounting principles, the provisions of the federal Single Audit Act Amendments of 1996 and Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).

The auditor is not required to audit the combining and individual fund financial statements and supporting schedules. The auditor is to provide an “in-relation-to” report on the basic financial statements and supporting schedules based on the auditing procedures applied during the audit of the basic financial statements. The auditor is required to express an opinion on the compliance #1..
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20 for each major federal program as part of the single audit. The auditor will report any identified material weaknesses or significant deficiencies in internal control but does not express an opinion on internal control.

The City is the financial administrator for two (2) joint power agencies, two (2) state programs, one (1) county wide sales tax program, known as Measure L and twelve (12) Community Facilities Districts (CFD) with the possibility of increasing to up to eighteen (18) CFDs and will require the financial statement compilation and express an opinion on the financial statements for these funds.

1.2 TECHNICAL SPECIFICATIONS:

A. The City has obtained the "Certificate of Achievement for Excellence in Financial Reporting" from the Government Finance Officers Association (GFOA) of the United States and Canada for the 38th year. It is the City's intention to continue to receive these awards annually and will expect the Annual Comprehensive Financial Report ( A C F R ) to meet the requirements of those programs. The auditor will be expected to review the final draft of the ACFR for compliance with the certificate program checklists.

B. The City has obtained the award from GFOA for the Popular Annual Financial Report (PAFR) for the 5th year. A PAFR presents financial information in a manner that appeals to the reader, is understandable and shows creativity and usefulness. It is the City’s intention to continue to receive this award annually and will expect the PAFR to meet the requirements of the GFOA award program. The auditor will be expected to review the final draft of the PAFR for compliance with the certificate program checklists.

B. The City anticipates it will prepare one or more official statements in connection with the sale of debt securities which will contain the basic financial statements and the auditor's report thereon. The auditor shall be required, if requested by the municipal advisor and/or the underwriter, to issue a "consent and citation of expertise" as the auditor, and any necessary "comfort letters."
C. The Schedule of Expenditures of Federal Awards and related auditors' report, as well as the reports on the internal controls and compliance are not to be included in the Annual Comprehensive Financial Report, but are to be issued separately.

D. The City may request additional services from the auditor, subject to compliance with independence standards, including the following:

1. The City has several debt issues that may or may not be subject to arbitrage rebate requirements or have complex accounting requirements. The auditor may be asked to prepare the necessary calculations or assist with journals and advise the City accordingly.

2. The City is occasionally confronted with complex tax issues related to #1..
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21 employment taxes withholding and reporting, information reporting, etc. The auditor may be asked from time to time to advise the City on tax related issues and to recommend a proper course of action.

E. In addition to expressing an opinion on the City’s compliance with current governmental GAAP, the audit firm shall also be required to provide assistance and guidance in the implementation of all new GASB pronouncements not yet in effect.

F. Working Paper Retention and Access to Working Papers. All working papers and reports must be retained, at the auditor's expense, for a minimum of seven (7) years, unless the firm is notified in writing by the City of Modesto of the need to extend the retention period. The auditor will be required to make working papers available, upon request, to the following parties or their designees:

1. City of Modesto.

2. Oversight or cognizant agencies.

3. Parties designated by the federal or state governments or by the City as part of an audit quality review process.

4. Auditors of entities of which the City is a sub recipient of grant funds.

5. Auditors of entities of which the City is a component unit.

6. In addition, the firm shall respond to the reasonable inquiries of successor auditors and allow successor auditors to review working papers relating to matters of continuing accounting significance.

1.3 FUND STRUCTURE:

The City uses the following fund types and account groups in its financial reporting:

Fund Types No. of Groups
General Fund 1
Special Revenue Funds 8
Debt Service Funds 1
Capital Projects Funds 8
Enterprise Funds 9
Internal Service Funds 6
Private Purpose Trust Fund 2
Custodial Funds 4

1.4 BUDGETARY BASIS OF ACCOUNTING:

Budgets for all fund types including the General, Special Revenue and Debt Service funds are #1..
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22 adopted on a basis consistent with generally accepted accounting principles. The modified accrual basis of accounting is employed in the preparation of the budget. At fiscal year-end, budget appropriations lapse. Capital projects and certain operating programs are budgeted on a multi-year basis. Unspent multi-year budget appropriations are carried over in the following fiscal year.

1.5 PROPOSED SCHEDULE FOR THE 2022/2023 YEAR AUDIT:

The City will have records ready for interim audit work and all management personnel available to meet with the firm’s personnel after execution of contracts. (A similar time schedule will be developed for audits of future fiscal years and will be agreed upon by City and auditors during the exit conference).

Each of the following should be completed by the auditor no later than the dates indicated.

A. Entrance Conference:

The entrance conference shall be held with City staff by March 1, 2023. The primary purpose of this meeting will be to discuss the interim work to be performed. This meeting will also be used to establish overall liaison for the audits, make arrangements for work space and other needs of the auditor, and plan for the year-end and single audits.

B. Detailed Audit Plans:

The auditor shall provide the City by March 31, 2023, both detailed audit plans and a list of all schedules to be prepared by the City.

C. Interim Work:

The auditor shall complete interim work by June 2, 2023.

D. Fieldwork:

The auditor shall complete all fieldwork by October 27, 2023.

E. Exit Conference:

The exit conference shall be held with City Management by October 27, 2023. The purpose of this meeting will be to summarize the results of the fieldwork and to review significant findings.

This meeting will also be used to establish the schedule for the new fiscal year audit.

F. Draft Reports:

The initial Draft Basic Financial Statements shall be submitted to the auditor by the City by October 16, 2023. The auditor shall have the draft Single Audit and recommendations to City Management available for review by October 16, 2023.

G. Date Final Reports are Due:
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23 The final Basic Financial Statements are due by December 8, 2023. The final Single Audit Report and Management Letter are due by December 8, 2023.

1.6 ASSISTANCE TO AUDITOR AND REPORT PREPARATION:

A. Finance Department and Clerical Assistance:

The Finance Department staff and responsible management personnel shall be available during the audit to assist the firm by providing direction to needed sources of information, documentation and explanations. The City of Modesto shall work jointly with the auditors to prepare the confirmation letters.

B. Information & Technology Department:

IT personnel and finance management shall be available to provide systems documentation and explanations. The auditor shall be provided computer time and the use of the City of Modesto's computer hardware and software. The City's financial management system shall be available online from 7:30 AM to 5:00 PM.

C. Statements and Schedules Prepared by City Staff:

Finance department staff will prepare the lead schedules, financial statements, notes, and required supplementary schedules for the ACFR. However, auditor assistance may be required with certain note disclosures or schedules.

D. Work Area and Equipment:

The City of Modesto will provide the auditor with reasonable work space, desks and chairs and VPN access. The auditor will also be provided with access to telephone lines, photocopying facilities and FAX machines, the auditor shall provide all Wi-Fi connection for their own work computer stations. It is expected that use of such facilities and equipment be limited to reasonable and pertinent business concerning the City engagement.

E. Report Preparation:

Report preparations, Report editing and typing of the Single Audit and other reports shall be the responsibility of the auditor. Auditors will be responsible for printing of Single Audit and other financial reports.

City staff shall be responsible for preparation and printing of the Annual Comprehensive Financial Report.

1.7 DELIVERABLES/REPORTS:

Following the completion of the audit of the fiscal year’s financial statements, the auditor shall issue:

A. An audit report of the basic financial statements and assistance with the preparation of the Annual Comprehensive Financial report and review of GANN appropriations limit report.
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24 B. A report on compliance and internal control over financial reporting based on an audit of the financial statements.

C. Testing five (5) programs for compliance with the Single Audit Act and applicable laws and regulations and issuance of a report thereon for the City and joint power agencies.

D. A report on compliance and internal control over compliance applicable to each major federal program.

E. A report on compliance with specific requirements applicable to non-major federal financial assistance programs.

F. Separate audit reports for the financial statements of the following component units and joint ventures of the City of Modesto:

1. Tuolumne River Regional Park (TRRP)

2. The Community Facilities Districts (CFDs) (currently the City has twelve (12) CFDs but the number may increase to up to eighteen (18))

3. Ceres-Modesto Industrial Fire Protection JPA

4. Measure L - Local Roads First Transportation Funding Measure G. Separate audit reports on the following State programs:

1. Local Transportation Funds (LTF) - Streets and Roads and Non-motorized funds under Transportation Development Act (TDA)

2. Abandoned Vehicle Abatement (AVA)
H. Preparation of Annual Report of Financial Transactions for the City (State Controller's Report).

I. Others, as requirements change, may be added as additional work, as covered in the RFP by the terms for such work.

J. In the required report(s) on compliance and internal controls, the auditor shall communicate any reportable conditions found during the audit. A reportable condition shall be defined as a significant deficiency in the design or operation of the internal control structure, which could adversely affect the organization's ability to record, process, summarize and report financial data consistent with the assertions of management in the financialstatements.

K. Reportable conditions that are also material weaknesses shall be identified as such in the report. Non-reportable conditions discovered by the auditors shall be reported in a separate letter to management, which shall be referred to in the reports on internal #1..
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25 controls.

L. Reports on compliance shall include all instances of non-compliance.

Irregularities and illegal acts: Auditors shall be required to make an immediate, written report of all irregularities and illegal acts or indications of illegal acts of which they become aware to the following parties:

City Manager City Auditor
Deputy City Manager
City Attorney
Director of Finance
City Clerk
M. Reporting to the audit committee. Auditors shall assure that the City of Modesto's Audit Committee is informed of each of the following:

1. The auditor's responsibility under generally accepted auditing standards

2. Significant accounting policies

3. Management judgments and accounting estimates

4. Significant audit adjustments

5. Other information in documents containing audited financial statements

6. Disagreements with management

7. Management consultation with other accountants

8. Major issues discussed with management prior to retention

9. Difficulties encountered in performing the audit
Submittals shall include, at a minimum, the following components.

1.8 COVER LETTER:

A signed cover letter briefly stating the proposers’ understanding of the work to be done, the commitment to perform the work within the time period, and a statement why the firm believes itself to be best qualified to perform the engagement.

1.9 TECHNICAL PROPOSAL:

The technical proposal shall follow the order set forth in items A through I of this section.

The purpose of the Technical Proposal is to demonstrate the qualifications, competence and capacity of the firms seeking to undertake an independent audit of the City in conformity with the requirements of this RFP. As such, the substance of proposals will carry more weight than their form or manner of presentation. The Technical Proposal should demonstrate the qualifications of the firm and of the particular staff to be assigned to this engagement. It should also specify an audit approach that will meet the request for proposals requirements.

The Technical Proposal should address all of the points outlined in the RFP. The Proposal should be a straightforward, concise description of the proposer's capabilities to satisfy the requirements of the RFP. While additional data may be presented, the following subjects, items Nos. A through I, shall be included. They represent the criteria against which the proposal will be evaluated.
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26 A. Independence:

The firm shall provide an affirmative statement that is independent of the City of Modesto as defined by the U.S. General Accounting Office's Government Auditing Standards (1994 edition, with all subsequent amendments).

The firm shall also provide an affirmative statement that it is independent of the component units of the City as defined by those same standards.

The firm should also list and describe the firm's (or proposed subcontractors') professional relationships involving the City or any of its component units for the past five (5) years, together with a statement explaining why such relationships do not constitute a conflict of interest relative to performing the proposed audit.

In addition, the firm shall give the City written notice of any such professional relationships entered into during the period of this agreement.

B. License to Practice in California:

An affirmative statement should be included that the firm and all assigned key professional staff are properly licensed to practice in the State of California.

C. Firm Qualifications and Experience:

The proposer shall state the size of the firm, the size of the firm's governmental audit staff, the location of the office from which the work on this engagement is to be performed, and the number and nature of the professional staff to be employed in this engagement on a full-time basis and the number and nature of the staff to be employed on a part-time basis.

If the proposer is a joint venture or consortium, the qualifications of each firm comprising the joint venture or consortium shall be separately identified and the firm that is to serve as the principal auditor shall be noted, if applicable.

The firm is also required to submit a copy of the report on its most recent external quality control review, with a statement whether that quality control review included a review of specific government engagements.

The firm shall also provide information on the results of any federal or state desk reviews or field reviews of its audits during the past three (3) years. In addition, the firm shall provide information on the circumstances and status of any disciplinary action taken or pending against the firm during the past three (3) years with state regulatory bodies or professional organizations.

D. Partner, Supervisory and Staff Qualifications and Experience:

Identify the principal, supervisory and management staff, including engagement partners, managers, other supervisors and specialists, who would be assigned to the engagement. Indicate whether each such person is registered or licensed to practice #1..
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27 as a certified public accountant in California. Provide information on the government auditing experience of each person, including information on relevant continuing professional education for the past three (3) years and membership in professional organizations relevant to the performance of this audit.

Provide as much information as possible regarding the number, qualifications, experience and training, including relevant continuing professional education, of the specific staff to be assigned to this engagement. Indicate how the quality of staff over the term of the agreement will be assured.

Engagement partners, managers, other supervisory staff and specialists may be changed if those personnel leave the firm. These personnel may also be changed for other reasons with the express prior written permission of the City of Modesto.

However, in either case, the City retains the right to approve or reject replacements.

Consultants and firm specialists mentioned in response to this RFP can only be changed with the express prior written permission of the City, which retains the right to approve or reject replacements.

Other audit personnel may be changed at the discretion of the proposer provided that replacements have substantially the same or better qualifications or experience.

E. Prior Engagements with the City:

List separately all engagements within the last five (5) years, ranked on the basis of total staff hours, for the City by type of engagement (i.e., audit, management advisory services, other). Indicate the scope of work, date engagement partners, total hours, the location of the firm's office from which the engagement was performed, and the name and telephone number of the principal client contact.

F. Similar Engagements With Other Government Entities:

For the firm's office that will be assigned responsibility for the audit, list the most significant engagements performed (maximum of five (5) to be listed) in the last five (5) years that are similar to the engagement described in this RFP. These engagements should be ranked on the basis of total staff hours. Indicate the scope of work, date, engagement partners, total hours, and the name and telephone number of the principal client contact.

G. Specific Audit Approach:

The proposal shall set forth a work plan, including an explanation of the audit methodology to be followed, to perform the services required outlined in this RFP.

In developing the work plan, reference shall be made to such sources of information as City budget and related materials, organizational charts, manuals and programs, and financial and other management information systems.

Proposers shall be required to provide the following information on their audit approach:
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28 1. Proposed segmentation of the engagement.

2. Level of staff and number of hours to be assigned to each proposed segment of the engagement.

3. Sample size and the extent to which statistical sampling is to be used in the engagement.

4. Describe the type and extent of analytical procedures to be used in the engagement and how analytical information will be utilized in approaching the engagement.

5. Approach to be taken to gain and document an understanding of the City's internal control structure.

6. Approach to be taken in determining laws and regulations that will be subject to audit test work.

7. Approach to be taken in drawing audit samples for purposes of tests of compliance ·
H. Identification of Anticipated Potential Audit Problems:

The proposal should identify and describe any anticipated potential audit problems, the firm's approach to resolving these problems, and any special assistance that will be requested from the City.

I. Report format:

The proposal shall include sample formats of required reports.

1.10 MANDATORY ELEMENTS:

Proposer shall provide detailed information on the following:

A. The audit firm is independent and licensed to practice in California.

B. The firm has no conflict of interest or impairment to independence with regard to any other work performed by the firm for the City.

C. The firm adheres to the instructions in this RFP on preparing and submitting their proposal.

D. The firm submits a copy of its last external quality control review report and a record of quality audit work.

1.11 EXPERTISE AND EXPERIENCE:

Proposer shall provide detailed information on the following:

A. The firm’s past experience and performance on comparable governmental engagements. #1..
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29 B. The firm’s professional personnel and management personnel assigned to the engagement.

1.12 AUDIT APPROACH:

Proposer shall provide detailed information on the following:

A. Proposed staffing plan for the various segments of the engagement.

B. Sampling techniques.

C. Analytical procedures.

1.13 SUBCONTRACTING:

Should any firm submitting a proposal consider subcontracting portions of the engagement, that fact must be clearly identified in the proposal along with the name of the proposed subcontractor.

Following the award of the audit contract, no additional subcontracting shall be allowed without the express prior consent by the City of Modesto.

1.12 ACCOUNT MANAGER/SUPPORT STAFF
Please identify the account manager and support staff that will be assigned to this project and provide resumes. This should include the names, titles and qualifications (including education, degrees and specialization) of the Project Manager and support staff and any sub-consultants who will be performing work on the project. It should also include the Project Manager and support staffs experience, length of time with the firm and projects for organizational structure should be included.

1.13 REQUIRED LICENSES:

Prior to beginning any service that shall be furnished under this specification, the bidder shall secure the appropriate Business/Delivery license from the City of Modesto. Business/Delivery license information may be obtained by calling (209)577-5389.

If the bidder is furnishing any labor or service including installation or maintenance, the bidder shall possess the appropriate California Contractor's license(s) at the time the proposal is submitted. A contract shall not be awarded to a bidder that does not possess the appropriate Contractor's license(s). The appropriate Contractor's license(s) is that specified in this request, or if not specified, that which is otherwise required by law, and qualifies the Contractor to do business in the State of California.

1.14 INSURANCE:

The CONTRACTOR shall provide, at its own expense, and maintain at all times the following insurance with insurance companies licensed in the State of California and shall provide evidence of such insurance to the CITY as may be required by the City Clerk of the CITY. The policies or certificates thereof shall provide that, thirty (30) days prior to cancellation or material change in the policy, notices of same shall be given to the Risk Manager of the CITY by registered mail, return receipt requested, for all of the following stated insurance policies.
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30 A. Workers' Compensation - in compliance with the statutes of the State of California, plus employer's liability with a minimum limit of liability of $1,000,000.

B. General Liability - insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. The insurance shall indicate on the certificate of insurance the following coverage and indicate the policy aggregate limit applying to: premises and operations; broad form contractual; independent contractors and subcontractors; products and completed operations; and/or professional liability.

C. Automobile Liability – insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and property damage. This insurance shall cover any automobile for bodily injury and property damage.

D. Professional Liability – insurance with a minimum limit of $1,000,000 per claim and $2,000,000 policy aggregate. If coverage is on a claims-made basis it shall be maintained for at least three (3) years following completion of the work.

If at any time any of said policies shall be unsatisfactory to the CITY, as to form or substance or if a company issuing such policy shall be unsatisfactory to the CITY, the CONTRACTOR shall promptly obtain a new policy, submit the same to Risk Manager for approval and submit a certificate thereof as hereinabove provided. Upon failure of the CONTRACTOR to furnish, deliver or maintain such insurance and certificates as above provided, this Agreement, at the election of the CITY, may be forthwith declared suspended, or terminated. Failure of the CONTRACTOR to obtain and/or maintain any required insurance shall not relieve the CONTRACTOR from any liability under this Agreement, nor shall the insurance requirements be construed to conflict with or otherwise limit the obligations of the CONTRACTOR concerning indemnification. The CITY, it agents, officers, employees, and volunteers shall be named as an additional insured on all insurance policies required herein, except Workers' Compensation.

The Workers' Compensation insurer shall agree to waive all rights of subrogation against the CITY, its agents, officers, employees, and volunteers for losses arising from work performed by CONTRACTOR for the CITY.

The CONTRACTOR's insurance policy(ies) shall include a provision that the coverage is primary as respects the CITY; shall include no special limitations to coverage provided to additional insured; and, shall be placed with insurer(s) with acceptable Best's rating of A:VII or with approval of the Risk Manager.

For any claims related to this project, the CONTRACTOR’s insurance coverage shall be primary insurance as respects the Entity, its officers, officials, employees, and volunteers. Any insurance or self-insurance maintained by the Entity, its officers, officials, employees, or volunteers shall be excess of the Contractor’s insurance and shall not contribute with it. #1..
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31 REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES

GENERAL REQUIREMENTS

2.0 PROPOSAL SUBMITTAL:

Proposer should submit two “inked” (preferably blue ink) signed original proposal documents, plus two (2) copies of the signed original proposal document and one (1) electronic copy submitted via USB. The original proposal document(s) shall be clearly marked. Photocopies do not constitute an original proposal document.

FAILURE TO FURNISH AT LEAST ONE “INKED” SIGNED ORIGINAL PROPOSAL DOCUMENT MAY RESULT IN DISQUALIFICATION.

It is the responsibility of the proposers to identify information in their proposal responses that they consider confidential under the California Public Records Act. To the extent that the City agrees with that designation, such information will be held in confidence whenever possible. All other information will be considered public.

All costs associated with the preparation of this proposal shall be borne by the proposer.

All exceptions taken to these specifications shall be specifically and clearly identified on the Exceptions, Clarifications, and Amendments Form. Failure to comply with this provision is grounds for proposal rejection.

Exceptions taken shall not affect the overall performance and quality of the services required by the City. The Purchasing Manager or her designated agent shall make the final decision regarding the acceptability of the services with exceptions.

Proposal shall be made in the format specified below. All requested exhibits shall be submitted with the completed Proposal and in the designated format. No oral, telegraph, telephone, facsimile or electronic proposals will be accepted. Failure to comply with all requirements may result in proposal rejection.

2.0.1 PROPOSAL PREPARATION:

Proposal shall be submitted in a three-ring binder with section tabs (A through Z as needed) with responses in the order described below. In those instances where specific questions are asked, each question shall be repeated in the proposal with the response following the question.

Extraneous or marketing information shall not be included.

If a service requirement cannot be met, Proposer shall indicate “No Proposal” in the relevant section of the proposal. In this case, proposer may offer an alternative equivalent service.

2.0.2 ACCEPTANCE/REJECTION OF IRREGULAR PROPOSALS:

A contract shall be awarded to the proposer whose proposal most closely satisfies the needs of the City and is deemed the most advantageous to the City. The City reserves the right to reject any or all proposals or to waive any informalities or minor irregularities in a proposal. #1..
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32 2.0.3 COMPLETE PROPOSAL SUBMITTAL:

The following documents constitute the makeup of a complete proposal submittal:
 Proposal Acknowledgement (Signature Form)
 Pricing Schedule (Signature Form)
 Exceptions, Clarifications, Amendments
 References
 Financial Interest Disclosure (Signature Form)
 Addenda Acknowledgment Form (If Applicable)
 Company History Statement
 Minimum Qualifications (Financials)
 Technical Proposal
Failure to furnish any of these documents may result in disqualification.

2.0.4 PROPOSAL PREPARATION:

Proposals shall be prepared in the order listed in Section 2.1.3 Complete Proposal Submittal.

Proposals should be tabbed with dividers. Tabbed dividers shall be clearly marked indicating the appropriate document.

2.1 COMPLIANCE:

Proposers are required to sign the “Pricing Schedule, Financial Interest Disclosure and Proposal Acknowledgement Forms” of this proposal document, thereby acknowledging they are in full compliance with all requirements of RFP No. 2122-40, and any addendum to such proposal.

Failure to comply may result in disqualification.

The proposer guarantees that the offered equipment, material or services meet all safety requirements applicable in accordance with Cal-OSHA regulations and any other rule or regulation required by the City of Modesto.

2.2 NON-COMPLIANCE:

If you cannot comply with a specification requirement, note as an addendum on the Exceptions, Clarifications, Amendments Form specification paragraph, your exception, and your recommendation. The Purchasing Manager will evaluate your recommendation. If after evaluation it is determined that the proposer is not in compliance with the specification, the proposal may be rejected.

2.3 PRICING FORMAT:

All labor, initial background checks, drug-screening, licenses and insurance necessary to perform the services shall be included in the proposed pricing.

Unless otherwise stated, the proposer agrees that, in the event of a price decline, the benefit of such lower pricing shall be extended to the City.

2.4 PRICING SCHEDULE:

Proposers shall use the Pricing Schedule Form to present their proposed pricing. No other form or format shall be accepted.
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33 2.5 AWARD OF PROPOSAL:

Proposals shall be evaluated by a committee and will be ranked in accordance with the RFP section entitled “Evaluation Criteria.”
The committee shall recommend award to the proposer who, in its opinion, has submitted a proposal that best serves the overall interests of the City, and attains the highest overall point score.

Award may not necessarily be made to the proposer with the lowest price.

The City reserves the right to decline to award a contract if it is determined that the proposed pricing is not competitively priced based on similar contracts with public agencies within the State of California.

The City reserves the right to select that proposal, which best suits the City’s needs. Regardless of City staff’s recommendation, the City Council reserves the right to award a contract to the proposer that best suits the City’s needs as determined by the City Council whether or not said award is consistent with City staff’s recommendation for award.

2.6 EVALUATION PROCESS:

Proposals shall be evaluated using a three (3) step process:

Level 1 – Minimum Qualifications Review: The City shall perform an initial responsiveness review to determine compliance and shall notify disqualified Proposers. Proposers that do not meet the “Minimum Qualifications” requirements shall be deemed non-responsive and/or/nonresponsible to this RFP and will receive no further consideration.

Level 2 – Proposal Content and Cost Ratings: Proposals that meet Level 1 Minimum Qualifications Review shall be evaluated based on the evaluation criteria “Proposal Evaluation Criteria”. Proposer submittals shall be evaluated and scored. Proposer cost information shall be evaluated as part of Level 2 evaluation process.

Level 3 – Short List (Oral Presentations): At the sole discretion of the Evaluation Committee, a “short list” of proposers may be developed of the highest rated written submissions, based on Level 1 and Level 2 rankings. If the Evaluation Committee chooses, these proposers would be invited to give presentations. Final scoring of “short list” proposals shall be completed upon the conclusion of presentations.

2.7 TERM OF CONTRACT:

The term of the contract shall be for a period of three (3) years, with two (2) one-year extension options at the sole discretion of City, for a total of up to five (5) years.

Pricing shall remain firm for the first two (2) years of any contract, which may be awarded pursuant to this RFP.

Price increases for subsequent contract years number and number, shall not exceed the Consumer Price Index (CPI) for West Urban Area in any one contract year, and shall be negotiated through the Purchasing Division. Requests for price increases shall be submitted by Contractor(s) in writing, at least sixty (60) days prior to the annual anniversary date of the contract to be effective for the subsequent year.
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34 2.8 QUANTITIES:

The successful proposer shall be required to provide whatever quantities may be required during the contract term. No minimum or maximum is guaranteed or implied.

2.9 FUNDING:

All annual extensions are based upon continuous funding for that purpose by the City Council.

Failure to fund any annual extension shall result in an immediate termination of the agreement without redress.

2.10 INSPECTION AND ACCEPTANCE:

Whenever the product or service provided by the supplier has been delivered to the delivery point, the designated agent shall make the final inspection and acceptance.

If upon initial inspection the product or service is found to be defective in its construction or deficient in any of the requirements of this specification, the supplier shall remedy or remove said product in an acceptable manner at the supplier's expense. No compensation shall be allowed for such correction of product, labor, or transportation of product.

2.11 CITY BUSINESS LICENSE:

Prior to beginning any service, that shall be furnished under this specification and proposal, the Proposer shall secure the appropriate Business license from the City of Modesto. Business license information may be obtained by calling (209) 577-5389.

2.12 TERMINATION OF SERVICES:

Refer to the “Sample Agreement” for termination of services

2.13 ELECTRONIC PAYMENT:

Electronic Payment Method:

The City of Modesto provides an Epay Program which involves payment of invoices by a secure Visa account number assigned to the supplier after award of bid or contract. Notification of payments and required invoice information is issued to the supplier’s designated Accounts Receivable contact by email remittance advice at time of payment.

During the evaluation process preference may be shown to proposers that agree to accept Epay for payment of invoices. Please indicate on the Pricing Schedule whether or not your company will accept the City’s Epay Program.

Invoice to: City of Modesto
Attn: Accounts Payable
P.O. Box 642
Modesto, CA 95353
Email to: [email protected]
The preferred method for submitting invoices in electronically via email.

2.14 OTHER GOVERNMENT/PUBLICLY FUNDED AGENCIES:

If mutually agreeable to all parties, the issuance of any resultant contract/purchase order referencing these specifications and modified by mutual agreement between all parties may be #1..
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35 extended to other government or publicly funded agencies. It shall be understood that all terms and conditions as specified herein shall apply.

2.15 NON-DISCRIMINATION:

A. During the performance of this contract, Contractor and its subcontractors shall not unlawfully discriminate against any employee or applicant for employment because of race, color, ancestry, religion, sex, national origin, marital status, age, medical condition (cancer related), physical handicap (including AIDS), or sexual orientation. Equal employment opportunity extends, but is not limited to recruitment, compensation, benefits, layoff, termination, and all other conditions of employment. Contractor and subcontractors shall ensure that the evaluation and treatment of their employees and applicants for employment are free of such discrimination. Contractor and subcontractors shall comply with the provisions of the Fair Employment and Housing Act (Government Code, Section 12900 et seq.) and the applicable regulations promulgated thereunder (California Administrative Code, Title 2, Section 7285.0 et seq.). The applicable regulations of the Fair Employment and Housing Commission implementing Government Code, Section 12900, set forth in Chapter 5 of Division 4 of Title 2 of the California Administrative Code are incorporated into this contract by reference and made a part hereof as if set forth in full.

B. Contractor and its subcontractors shall give written notice of their obligations under this clause to labor organizations with which they have a collective bargaining or other agreement.

C. Contractor shall include the nondiscrimination and compliance provisions of this clause in all subcontracts to perform work under the contract.

D. Contractor shall permit access by representatives of the Department of Fair Employment and Housing and the City upon reasonable notice at any time during the normal business hours, but in no case less than twenty-four (24) hours notice, to such of its books, records, accounts, other sources of information and its facilities as said Department or City shall require to ascertain compliance with this clause.

2.16 NON-DISCRIMINATION OF THE HANDICAPPED:

CERTIFICATION OF PROPOSER REGARDING NON-DISCRIMINATION OF THE

HANDICAPPED
By executing this agreement, the proposer hereby certifies that he/she is in compliance with the Americans with Disabilities Act of 1990, the applicable administrative requirements promulgated in response thereto, and any other applicable Federal laws and regulations relating to handicap discrimination and participation, and will continue to do so for at least the duration of the agreement and any extensions thereof.

2.17 DRUG FREE WORKPLACE:

Proposer/Contractor certifies that he/she is in compliance with Sections 8350 - 8355 of Chapter

5.5 of the Government Code, Drug Free Workplace Act. Every person or organization awarded a contract/purchase order or grant for the procurement of any property or service from any state #1..
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36 agency (city) shall certify to the contracting or granting agency that it will provide a drug free workplace.

2.18 HOLD HARMLESS AGREEMENT:

The CONTRACTOR shall hold the CITY, its agents, officers, employees, and volunteers, harmless from and save, defend and indemnify them against any and all claims, losses, liabilities and damages from every cause, including but not limited to injury to person or property or wrongful death, with the indemnity to include reasonable attorney's fees, and all costs and expenses, arising directly or indirectly out of any act or omission of CONTRACTOR, whether or not the act or omission arises from the sole negligence or other liability of CITY, or its agents, officers, employees, or volunteers relating to or during the performance of its obligations under the Agreement.

2.19 ASSIGNMENT OF RIGHTS:

CONTRACTOR offers and agrees, and will require all subcontractors and suppliers to agree, to assign to the CITY all rights, title, and interest in and to all causes of action it and they may have under Section 4 of the Clayton Act (15 United States code, Section 15) or under the Cartwright Act (Business and Professions Code, Section 16700 et seq.), arising from the purchase of goods, services, or materials pursuant to this contract or any subcontract. The assignment made by CONTRACTOR and all assignments made by subcontractors and suppliers shall be made and become effective at the time the CITY tenders final payment to CONTRACTOR, without further acknowledgment by the parties (Government Code, Sections 4550-4554).

2.20 CITY PROCESS/PROCEDURE APPROVALS:

CITY approval of any process or procedure shall not relieve the proposer of his/her responsibility to furnish the required items and service meeting all specifications contained herein.

2.21 PROPOSAL/SELLER REPRESENTATION:

The proposer/seller represents that:

A. He/She has had an opportunity to examine and has examined any and all of the documents, including specifications, any resultant purchase order and supporting data, and that he/she has, from the information contained in such documents, specifications, and data, fully acquainted him/her with all conditions relevant to the work.

B. He/She has made all reasonable investigations essential to a full understanding of the difficulties, which may be encountered in performing the work.

C. He/She will complete the work for the compensation stated above.

D. He/She assumes full and complete responsibility for all conditions relevant to the work and all risks in connection therewith.

E. In addition thereto, the proposer/seller represents that he/she is fully qualified to do the work in accordance with the terms of any Purchase Order issued within the time specified in it.
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37 F. Anything mentioned in the specifications and not in the Purchase Order, or mentioned in the Purchase Order and not mentioned in the specifications, shall be of like effect as if shown or mentioned in both. In case of difference between the specifications and the Purchase Order, the Purchase Order shall govern.

2.22 FAILURE TO PERFORM SATISFACTORY:

It is agreed and understood that if the CONTRACTOR fails to perform the work as specified herein, CITY's representative may (1) consent to accept such unsatisfactory service with an appropriate adjustment in contract price, based on established cost factors, (2) have such required work done by CITY forces or otherwise, and charge the cost thereof to the CONTRACTOR, or (3) recommend termination of contract between said CONTRACTOR and the City of Modesto.

Those discrepancies and deficiencies in the work that remains uncorrected after the date set for correction may be the necessary justification for a billing adjustment in the month following the occurrence. Unless otherwise negotiated, billing adjustments for this incomplete or uncorrected work shall be permanent retention of 100% of the estimated monthly cost for the work not corrected or completed.

2.23 CONTRACTOR'S RESPONSIBILITY FOR DAMAGES:

If CONTRACTOR damages any property belonging to the CITY, the CITY may either retain from the money due to CONTRACTOR an amount sufficient to repair the damage or require CONTRACTOR to repair the damage to the satisfaction of the CITY at CONTRACTOR's expense.

2.24 LABOR FORCE AND SUPERVISION:

CONSULTANT shall provide sufficient labor at all times to carry out the project properly and shall ensure that fully experienced competent licensed workers who are skilled in the type of work required are employed. CONSULTANT shall ensure that supervision is provided at all times while any work under this contract is being performed. If, in the judgment of the CITY, any person is incompetent or disorderly, CONSULTANT shall promptly remove such person from the work for the duration of the contract.

2.25 PROTEST AND APPEAL PROCEDURES:

Potential offerors, bidders, contractors, and subcontractors wishing to protest or appeal a procurement or contracting decision by the City of Modesto must follow the procedures provided by the section. Protests or appeals which are not submitted in accordance with these procedures will not be reviewed.

DEFINITIONS
For the purposes of this procedure: "Days" means working days in which City Hall is open for business, excluding holidays and weekends.
"Filing Date" or "Submission Date" means the date of receipt by the City Clerk’s office of the City of Modesto.
"Interested Party" means an actual or prospective bidder or offeror, or any contractor or subcontractor identified by name in any bid or proposal. "Bid" includes the term "offer" or "proposal" as used in the context of formal, informal, or negotiated procurements.
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38 "Announced Decision" includes the term “Notice of Intent to Award Letter”. Once the City has issued an Announced Decision, the date noted will begin the time that an Interested Party may lodge a protest. Procurements valued at $50,000 or less normally will not have an Announced Decision.

A. PROTEST PROCEDURES

1. Any interested party may lodge a written protest to an Announced Decision with the City of Modesto's Purchasing Manager no later than ten (10) days after the Announced Decision.

2. The protest shall be delivered or sent by registered mail and postmarked by the deadline, or protest will be automatically rejected. Protestors who choose to be represented by legal counsel are responsible for the associated expenses.

3. The protest shall be accompanied by a certified or cashier's check in the amount of $300.00, (EXCEPT FOR PROTESTS OF FEDERALLY FUNDED
PROJECTS) or in such other sum as the City may establish, made payable to the Clerk of the City of Modesto. Protests filed without the requisite fee will be rejected without any additional review.

4. The protest filed with the Purchasing Manager shall:
a. Include the name, address, and business telephone number of the protestor;
b. Identify the project under protest by name, Request for Bid (RFB)/Request for Proposal (RFP) number, and bid/RFP date; c. Contain a concise statement of the grounds for protest; d. Include all supporting documentation, if any. Documentation submitted after filing deadline will not be reviewed.

All protests shall either be delivered to:

City Clerk’s Office
Attn: Purchasing Manager
1010 Tenth St. Suite 6600
Modesto CA 95354
Or mailed to:

City Clerk’s Office
Attn: Purchasing Manager
PO Box 642
Modesto CA 95353
B. PROTEST REVIEW (ANNOUNCED DECISION)
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39 1. Protest to Purchasing Manager
Upon receipt of a complete and timely protest, the Purchasing Manager shall review all the submitted materials and shall create and retain a written record of the review. The Purchasing Manager shall respond at least generally to each material issue raised in the protest not later than ten (10) days after receipt of the protest. Notice of the Purchasing Manager's decision may be given by letter mailed through U.S. Postal Service.

2. Appeal to Deputy City Manager
The Purchasing Manager's decision may be appealed in writing to the City of Modesto's Deputy City Manager(s) no later than ten (10) days after the date of the Purchasing Manager’s Decision. The scope of the appeal shall be limited by the issues raised in the initial protest to the Purchasing Manager. The Deputy City Manager shall not be permitted to review any newly raised issues. The Deputy City Manager shall review the appeal, accompanying supporting documents, if any, and the written record of the protest review by the Purchasing Manager.

A written record of the Deputy City Manager's review shall be created and maintained. The Deputy City Manager shall give notice of his or her decision to the protestor within ten (10) days after receipt of appeal.

All protest appeals shall either be delivered to:

City Clerk’s Office
Attn: Deputy City Manager
1010 Tenth St. Suite 6600
Modesto CA 95354
Or mailed to:

City Clerk’s Office
Attn: Deputy City Manager
PO Box 642
Modesto CA 95353

3. Appeal to City Council
Any protestor seeking to appeal to the decision of the Deputy City Manager may appeal in writing to the City Council by filing with the City Clerk a written notice of such appeal not later than fifteen (15) business days after the date of the Deputy City Manager's decision. The City Clerk will calendar the protest for Council hearing and give notice of the time and place of the hearing as provided in Modesto Municipal Code Sections 1-4.01 through 1-

4.05. #1..
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40 The City Council is the highest authority of the City of Modesto. It is possible that the City Council may reverse the decision of any City staff member at the hearing, or provide other direction to staff. In such cases, staff cannot reverse a City Council decision.

All protests shall either be delivered to:

City Clerk’s Office
Attn: City Council
1010 Tenth St. Suite 6600
Modesto CA 95354
Or mailed to:

City Clerk’s Office
Attn: City Council
PO Box 642
Modesto CA 95353
C. PROTESTS OF PROCUREMENTS EXCEEDING $250,000.00
Interested parties protesting procurements exceeding $250,000.00 shall comply with the procedures contained herein, except that in lieu of appeal to the Deputy City Manager, a protestor may request that the protest be heard and decided at an administrative hearing.

A written request for administrative hearing shall be accompanied by a certified or cashier's check in the amount of $1,500.00, (EXCEPT FOR PROTESTS OF FEDERALLY FUNDED PROJECTS; Refer to Purchasing Procedures Manual for the Transit Division and Federal Transit Administration Funded Purchases, Chapter 14) payable to the City of Modesto, and shall be received by the Purchasing Manager not later than fifteen (15) days after dispatch of the Purchasing Manager's decision. The request for hearing shall include the specific grounds of the appeal.

The City of Modesto shall select and engage an impartial and qualified person to act as hearing officer in the pending protest. The protestor shall have the right to twice reject the selected hearing officer, provided that the City is notified of such rejection within three (3) days of notice to protestor of the name of the hearing officer.

The protest shall be heard not later than twenty (20) days after receipt of protestor's request for hearing and the selection of a hearing officer. Protests not heard in a timely manner shall be deemed withdrawn, unless the City and the protestor mutually agree otherwise in writing. The protestor’s failure to accept a hearing officer after the third attempt by City staff to identify an impartial hearing officer shall be deemed a withdrawal of the protest.

The costs of the hearing officer and expenses of the protest shall be borne by the protestor. The sums deposited with the request for hearing shall be credited to the costs of the hearing officer and other hearing expenses.
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41 The decision of the hearing officer shall be deemed as the final decision of the City, and no other appeal to City Staff or body shall be permitted.

D. PROCUREMENTS OBTAINED WITH FEDERAL FUNDS

1. If the protested procurement involves federal funds, e.g., from the Federal Transit Administration (FTA) of the United States, the Deputy City Manager, City Council, or hearing officer shall give notice, accompanying their respective decisions, to the protestor that he or she has the right to appeal to the appropriate federal agency, for which an agency name, contact (where available) and address shall be provided by City staff. Such an appeal shall be filed with the appropriate agency within seven (7) business days of the dispatch or rejection notices to the protestor. Federal agencies may entertain protests alleging that the City has failed to adopt written protest procedures or has failed to follow such procedures. Appeals to the Federal Transit Administration (FTA) shall comply with FTA Circular 4220.1E and the amendments and supplements thereto.

Additional information regarding protesting procurements obtained with Federal Funds can be found in the Purchasing Procedures Manual for the Transit Division and Federal Transit Administration Funded Purchases, Chapter 14.

2. The City Council is the highest authority of the City of Modesto. It is possible that the City Council may reverse the decision of any City staff member at the hearing before Council on the procurement at hand. In such cases, no internal appeal is possible since staff may in no case reverse a City Council decision. In such an event, a disappointed transit bidder or a contract involving expenditures of Federal funds shall have the right to appeal the City Council decision directly to the Federal Transit Administration. #1..
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42 SAMPLE AGREEMENT
REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES
THIS AGREEMENT, made and entered into in the City of Modesto, State of California, this day of , 2022 (“Effective Date”), by and between the CITY OF MODESTO, a municipal corporation of the State of California, hereinafter referred to as "City", and ___________________________, a California corporation, hereinafter referred to as "Consultant."
This Agreement is made with regard to the following recitals:

A. The City has determined that auditing services are services are needed to support the City of Modesto.

B. Consultant represents that it is qualified, willing and able to provide the services to prepare said document(s).

NOW, THEREFORE, in consideration of this agreement, and the mutual promises, covenants, and stipulations hereinafter contained, the parties agree as follows:

1. SCOPE OF SERVICES.

2. TERM OF AGREEMENT.

The term of the contract shall be for a period of three (3) years, with two (2) one-year extension options at the sole discretion of City, for a total of up to five (5) years. #1..
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43 Pricing shall remain firm for the first two (2) years of any contract, which may be awarded pursuant to this RFP.

City hereby gives Consultant notice to proceed with the preparation of the project in the manner described in Exhibit "A", as of the Effective Date of this agreement.

Consultant shall diligently proceed with the preparation of the project and agrees to complete said preparation within the time period set forth in Exhibit "A".

3. COMPENSATION.

Consultant agrees to accept a sum not to exceed $_________ AND XX/100 DOLLARS ($XXX,XXX.XX) as full remuneration for performing all services and furnishing all staffing and materials called for in Exhibit "A" and for performance by Consultant of all of its duties and obligations under this Agreement.

The Compensation shall be paid pursuant in the manner and at the times set forth below:

4. OBLIGATIONS OF CONSULTANT.
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44 Throughout the term of this Agreement, Consultant shall possess, or secure all licenses, permits, qualifications and approvals legally required to conduct business.

Consultant warrants that it has all of the necessary professional capabilities and experience, as well as all tools, instrumentalities, facilities and other resources necessary to provide the City with the services contemplated by this Agreement. Consultant further warrants that it will follow the best current, generally accepted and professional practices to make findings, render opinions, prepare factual presentations, and provide professional advice and recommendations regarding this project.

5. PERFORMANCE BY KEY EMPLOYEE.

Consultant has represented to City that NAME, TITLE, will be the person primarily responsible for the performance of the services referred to in this Agreement.

City has entered into this Agreement in reliance on that representation by Consultant. Consultant therefore agrees that ____ percent (__%) or more of the time to be devoted to the project that is the subject of this Agreement will be that of the above-named person.

6. OWNERSHIP OF DOCUMENTS/TITLE TO DATA.

Title to Data
If, as a part of the agreement, Consultant is required to produce data such as, but not limited to, drawings, plans, specifications, calculations, models, flow diagrams, visual #1..
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45 aids and other related materials, the originals of all such data generated under this agreement will be delivered to City upon the completion or termination of services under the contract.

7. NEWS AND INFORMATION RELEASE.

8. INTEREST OF CONTRACTOR.

Consultant warrants that it presently has no interest and shall not acquire any interest, direct or indirect, which would conflict in any manner or degree with the performance of services required to be performed under this Agreement. Consultant warrants that, in performance of this Agreement, Consultant shall not employ any person having any such interest. Consultant agrees to file a Statement of Economic Interests with the City Clerk at the start and end of this contract if so required at the option of City.

9. AMENDMENTS.

Both parties to this Agreement understand that it may become desirable or necessary during the execution of this Agreement, for City or Consultant to modify the scope of services provided for under this Agreement. Any material extension or change in the scope of work shall be discussed with City and the change and cost shall be memorialized in a written amendment to the original contract prior to the performance of the additional work. #1..
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46 Until a change order is so executed, City will not be responsible to pay any charges Consultant may incur in performing such additional services, and Consultant shall not be required to perform any such additional services.

10. INDEPENDENT CONTRACTOR.

Consultant has no authority or responsibility to exercise any rights or power vested in the City.

No agent, officer, or employee of the City is to be considered an employee of Consultant. It is understood by both Consultant and City that this Agreement shall not under any circumstances be construed or considered to create an employer-employee relationship or a joint venture.

Consultant is permitted to provide services to others during the same period service is provided to City under this Agreement. If necessary, Consultant has the responsibility for employing other persons or firms to assist Consultant in fulfilling the terms and obligations under this Agreement.
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47 If in the performance of this Agreement any third persons are employed by Consultant, such persons shall be entirely and exclusively under the direction, supervision, and control of Consultant. All terms of employment including hours, wages, working conditions, discipline, hiring, and discharging or any other term of employment or requirement of law shall be determined by the Consultant.

It is further understood and agreed that Consultant must issue W-2 forms or other forms as required by law for income and employment tax purposes for all of Consultant's personnel.

11. ASSIGNMENT.

Neither this Agreement nor any portion thereof shall be subcontracted or assigned without the express prior written consent of the City in each and every instance.

12. PATENT/COPYRIGHT MATERIALS.

13. NOTICES.
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48 Any and all notices permitted or required to be given hereunder shall be deemed duly given and effective (a) upon actual delivery, if delivery is by hand; or (b) five (5) days after delivery into the United States mail if delivery is by postage paid registered or certified (return receipt requested) mail. Each such notice shall be sent to the parties at the address respectively indicated below or to any other address as the respective parties may designate from time to time.

FOR Consultant:

Name:

Address:

Attention:

Phone: ( )
FOR CITY:

Name:

Address:

Attention:

Phone: ( )

14. INSURANCE REQUIREMENTS.

The Consultant shall provide at its own expense and maintain at all times the following insurance with insurance companies licensed in the State of California and shall provide evidence of such insurance to the City as may be required by the Risk Manager of the City. The policies or certificates thereof shall provide that, thirty (30) days prior to cancellation or material change in the policy, notices of same shall be given to the Risk Manager of the City by certified mail, return receipt requested, for all of the following stated insurance policies. (a) Worker's Compensation - in compliance with the statutes of the State of California, plus employer's liability with a minimum limit of liability of $1,000,000. #1..
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49 (b) General Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and $1,000,000 for property damage or $1,000,000 combined single limit. If commercial general liability insurance or other form with a general aggregate limit is used, either the general aggregate limit shall apply separately to this project/location or the general aggregate limit shall be twice the required per-occurrence limit.

This insurance shall indicate on the certificate of insurance the following coverages and indicate the policy aggregate limit applying to: premises and operations; broad form contractual; independent consultants and subcontractors; products and completed operations. (c) Automobile Liability insurance with a minimum limit of liability per occurrence of $1,000,000 for bodily injury and $1,000,000 property damage or $1,000,000 combined single limit. This insurance shall cover any automobile for bodily injury and property damage.
(d) Professional Liability (Errors and Omissions) Insurance with limits not less than $2,000,000 per claim, $4,000,000 aggregate. If coverage is on a claims made basis it shall be maintained for at least three (3) years following completion of the work.

Failure of the Consultant to obtain and/or maintain any required insurance shall not relieve the Consultant from any liability under this Agreement, nor shall the insurance requirements be construed to conflict with or otherwise limit the obligations of the Consultant concerning indemnification. The City, its agents, officers, employees, and volunteers shall be named as an #1..
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50 additional insured on all insurance policies required herein, except Workers' Compensation and Professional Liability. CONSULTANT shall provide CITY with separate endorsements evidencing proof of the CITY ’ s additional insured status as to both the general liability and automobile liability insurance policies. The Workers' Compensation insurer shall agree to waive all rights of subrogation against the City, its agents, officers, employees, and volunteers for losses arising from work performed by Consultant for the City. In addition, CONSULTANT shall provide CITY with a Workers Compensation subrogation waiver by way of a separate endorsement. The Consultant's insurance policy(ies) shall include a provision that the coverage is primary as respects the City; shall include no special limitations to coverage provided to additional insured; and, shall be placed with insurer(s) with acceptable Best's rating of A:VII or with approval of the Risk Manager. The Consultant must deliver certificates evidencing existence of the insurance listed above to the City prior to the time the contract is signed.

All endorsements referenced above must include the applicable policy number.

15. TERMINATION OF AGREEMENT.

Termination by City for Default of Consultant
Should Consultant default in the performance of this Agreement or materially breach any of its provisions, at its option, City may terminate this Agreement by giving written notification to Consultant. The termination date shall be the effective date of the notice. For the purposes of this section, material breach of this Agreement shall include, but not be limited to, any of the following: failure to perform required services or duties, willful destruction of City's property by Consultant, dishonesty or theft.

Termination by City for Convenience
The City may also terminate the Consultant's performance under the Agreement, either in whole or in part, at its own discretion, or when conditions encountered during the #1..
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51 Work make it impossible or impracticable to proceed, or when the City is prevented from proceeding with the Agreement by act of God, by law, or by official action of a public authority, or upon a determination by the City that such termination is in the best interest and convenience of the City, or whenever the City is prohibited from completing the Work for any reason. The City shall provide no less than ten (10) calendar days written notice of its intent to terminate the Agreement for convenience, and shall endeavor to provide the Consultant with consultation with the City prior to termination.

Post-Termination Procedures
If this Agreement is terminated pursuant to this Section, Consultant shall:
a. Cease its work as directed in the notice of termination as of the termination date and see to it that its employees, subconsultants and agents are notified of such termination and act as specified in the notice of termination;
b. Terminate all orders and Subcontractors except as necessary to complete any portion of the Work that is not terminated; c. If directed in writing by the City to do so, assign all right, #1..
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52 title and interest in subcontracts and materials in progress to City, in which case the City will have the right at its discretion to settle, or pay any or all claims arising out of the termination of such subconsultants, but in no event shall recovery by any Consultant or subconsultant include lost profits for portions of the Work not completed or undertaken, including materials not delivered; d. Deliver or otherwise make available to the City all data, drawings, specifications, reports, estimates, summaries and such other information and material as may have been accumulated by the Consultant in performing the Work whether completed or in process; e. Settle outstanding liabilities and claims, subject to the approval of City;
f. Complete performance of such part of the Work as has not been terminated;
g. Take such other actions as may be necessary, or as may be directed by the City for the protection and preservation of the Work and/or property related to the Work;
h. If City so requests, and at City's cost, Consultant shall provide sufficient oral or written status reports to make City reasonably aware of the status of Consultant's work on the project. i. The Consultant understands and agrees that City may, in City's sole discretion, refuse to pay Consultant for that portion of Consultant's services which were performed by Consultant on the project prior to the termination date and which remain
unacceptable and/or not useful to City as of the termination date. #1..
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53 City will pay Consultant an amount based on the percentage of satisfactory work completed in accordance with the notice of termination. If the Agreement is terminated pursuant to the subparagraph entitled Termination by City for Default of Consultant, Consultant understands and agrees that City may, in City's sole discretion, refuse to pay Consultant for that portion of Consultant's services which were performed by Consultant on the project prior to the termination date and which remain unacceptable and/or not useful to City as of the termination date. The final payment to the Consultant after termination for convenience shall be limited to amounts due and owing under the Agreement at time of termination, including the following:
a. The cost of settling and paying valid claims arising out of the termination of the Work such as subconsultant agreements or contracts for materials;
b. The Agreement price allocable to the portion of the Work properly performed or goods supplied to the work site by the Consultant as of the date of termination, as determined in accordance with the notice of termination, reduced by any sums previously paid to the Consultant.

16. CERTIFIED PAYROLL REQUIREMENT.

17. INDEMNITY.

The Consultant shall hold the City, its agents, officers, employees, and volunteers, harmless from and save, defend and indemnify them against any and all claims, #1..
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54 losses, liabilities, judgments or damages from every cause, including but not limited to injury to person or property or wrongful death, including reasonable costs and expenses of defense of any judicial or administrative action, arising directly or indirectly out of any act or omission of Consultant whether or not the act or omission arises from the sole negligence or other liability of City, or its agents, officers, and employees or volunteers relating to or during the performance of its obligations under this agreement.

Consultant's obligation to defend, indemnify, and hold the City, its agents, officers, and employees harmless under the provisions of this paragraph is not limited to or restricted by any requirement in this Agreement for Consultant to procure and maintain a policy of insurance.

18. ENTIRE AGREEMENT.

19. PARTIAL INVALIDITY.

20. WAIVER.
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55 The waiver by any party to this Agreement of a breach of any provision hereof shall be in writing and shall not operate or be construed as a waiver of any other or subsequent breach hereof unless specifically stated in writing.

21. AUDIT.

Consultant agrees to retain reports, records, documents, and files related to charges under this Agreement for a period of four (4) years following the date of final payment for Consultant services. City's representative shall have the right to reproduce any of the aforesaid documents.

22. GOVERNING LAW.

This Agreement shall be governed according to the laws of the State of California.

23. HEADINGS NOT CONTROLLING.

Headings used in the Agreement are for reference purposes only and shall not be considered in construing this Agreement.

24. COMPLIANCE WITH LAWS.

Consultant shall insure compliance with all safety and hourly requirements for employees, in accordance with federal, state, and county safety and health regulations and laws. Consultant shall fully comply with all applicable federal, state, and local laws, ordinances, regulations and permits.

25. CITY BUSINESS LICENSE.

Consultant shall have a City of Modesto business license. #1..
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56 IN WITNESS WHEREOF, the City of Modesto, a municipal corporation, has authorized the execution of this Agreement in duplicate by its City Manager and attestation by its City Clerk under authority of Resolution No. 2022- , adopted by the Council of the City of Modesto on the day of , 2022, and CONSULTANT, INC. has caused this agreement to be duly executed in duplicate as of the Effective Date.

CITY OF MODESTO, CONSULTANT, INC.
a municipal corporation a California corporation*
By ___________________________ By________________________________ JOSEPH P. LOPEZ, City Manager Name Title

By ________________________________
Name Title
ATTEST: (Seal)
By ___________________________
DANA SANCHEZ, Interim City Clerk
Consultant’s Federal ID #XX-XXXXXXX
APPROVED AS TO FORM:

By ________________________________
JOSE M. SANCHEZ, City Attorney
APPROVED AS TO FORM:

By ________________________________
CHRISTINA D. ALGER
Director of Human Resources (Risk)
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City of Modesto
Technical Proposal to RFP Specifications No. 2122-40 External Auditing Services 7 Pricing Schedule

PRICING SCHEDULE
REQUEST FOR PROPOSAL AND SPECIFICATIONS NO. 2122-40

EXTERNAL AUDITING SERVICES
Total All-Inclusive Maximum Price for combined Fiscal Years 2022/23, 2023/24 and 2024/25 shall be used for cost evaluation
Detail Schedule of Professional Fees and Expenses for Fiscal 2022/23 ONLY Item Hourly Rate Total Hours TOTAL
Basic
Financial
Statements
Partners $_Partners______________ 285 $______________________60 $__________________17,100 Specialists $_Manager______________180 $______________________64 $__________________11,520 Supervisory $_Supervisor____________160 $_____________________111 $__________________17,760 Staff $_Senior________________120 $_____________________226 $__________________27,120 Out-ofPocket
(Misc.)
$_Staff_________________100 $_____________________415 $__________________41,500 TOTAL Fiscal Year 2022/23: $_________________115,000
Detail Schedule of Professional Fees and Expenses for Fiscal 2022/23 ONLY Item Hourly Rate Total Hours TOTAL
Single Audit and
Management Letter
Partners $_Partners______________285 $______________________4 $___________________1,140 Specialists $_Manager_____________180 $______________________8 $___________________1,440 Supervisory $_Supervisor___________160 $_____________________16 $___________________2,560 Staff $_Senior_______________120 $_____________________58 $___________________6,960 Out-of-Pocket (Misc.) $_Staff________________100 $_____________________79 $___________________7,900 TOTAL Fiscal Year 2022/23: $__________________20,000_
Item Report Description
Fiscal Year
2022/23
Fiscal Year
2023/24
Fiscal Year
2024/25
City ACFR $ 71,000 $ 72,420 73,868$
Toulumne River Regional Park (TRRP) 5,000 5,100 5,202
Local Transportation Fund - TDA 5,000 5,100 5,202
Community Facilities Districts (12) 18,000 18,360 18,727 Ceres-Modesto Industrial Fire Protection JPA 5,000 5,100 5,202 Measure L 5,000 5,100 5,202
Abandoned Vehicle Abatement (AVA) 2,000 2,040 2,081
State Controller's Report - City Only 2,500 2,550 2,601 Review of Popular Annual Financial Report (PAFR) 1,500 1,530 1,561 Sub Total $ 115,000 $ 117,300 $ 119,646
Single Audit and Management Letter $ 20,000 $ 20,400 20,808$ TOTAL $ 135,000 $ 137,700 $ 140,454
Total All-Inclusive Maximum Price
Basic Financial
Statements
(Audits and
Reports)
Single Audit
and
Management
Letter
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City of Modesto
Technical Proposal to RFP Specifications No. 2122-40 External Auditing Services 8 #1..
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Audit CommitteeSeptember 15, 2022

Audit Committee
September 15, 2022