TO: HONORABLE MAYOR FROM: Julia H. Cooper
AND CITY COUNCIL
SUBJECT: SEE BELOW DATE: May 23, 2022
Approved Date
06/01/22
SUBJECT: AGREEMENT WITH MGT OF AMERICA CONSULTING LLC FOR A
CITYWIDE DISPARITY STUDY
RECOMMENDATION
Adopt a resolution authorizing the City Manager to:
(a) Negotiate and execute an agreement with MGT of America Consulting, LLC (Tampa, FL) for a Citywide disparity study and related services, for an initial term retroactively beginning on or about May 10, 2022 and ending June 30, 2023 with a total maximum compensation not to exceed $410,470, subject to the appropriation of funds;
(b) Exercise up to one one-year options to extend the term of the agreement with the last option ending on or about June 30, 2024 with total compensation not to exceed $500,000, subject to the appropriation of funds; and
(c) Negotiate and execute amendments and change orders as required for any unanticipated changes for a contingency amount not to exceed $89,530 during the term of the agreement, subject to the appropriation of funds.
OUTCOME
Production a Citywide disparity study report to help the City of San José (City) help assess its efforts to encourage participation of disadvantaged businesses in the City procurement and contracting processes and provide recommendations and refinements the City may take to increase the participation of disadvantaged businesses.
COUNCIL AGENDA: 06/14/22
FILE: 22-898
ITEM: 2.14
HONORABLE MAYOR AND CITY COUNCIL
May 23, 2022
Subject: Agreement with MGT of America Consulting LLC for a Citywide Disparity Study
BACKGROUND
A disparity study is used to determine if businesses – typically minority, women, and veteran- owned – face any barriers in the respective entity’s procurement and contracting processes. The City’ disparity study would assess City efforts to encourage participation and provide policy/procedure recommendations and refinements the City may take to increase participation of these groups. This specialized work effort includes a review of City procurement and contracting programs, data gathering for statistical and econometric analysis, vendor and community outreach, and a final report.
The City’s Attorney’s Office will review any programmatic changes the City desires to make as a result of the consultant’s final report and recommendations, as any changes must comply with the 1996 State of California approved Proposition 2091, which added the following language to the California Constitution:
The state shall not discriminate against, or grant preferential treatment to, any individual or group on the basis of race, sex, color, ethnicity, or national origin in the operation of public employment, public education, or public contracting.
At the January 12, 2021 City Council meeting, the Department of Public Works was directed to submit information through the Fiscal Year 2021-22 budget process for funding and resources for a City disparity study. Staff reviewed the scope and cost of disparity studies conducted by multiple jurisdictions within California over the past few years. The following three cities have performed recent, similar in size and scope disparity studies:
Report Year Entity Study Cost
2015 San Francisco Municipal Transportation Agency $450,000 2017 City of Oakland $490,875
2020 City of San Diego $477,000
As part of the City Council-approved Mayor’s June Budget Message for Fiscal Year 2021-2022, $50,000 was allocated for this project, and the Administration submitted information through the Fiscal Year 2022-23 budget process for additional funding in the amount of $400,000.
In February 2022, the City learned that the County of Santa Clara (County) executed an agreement with MGT of America Consulting LLC (MGT) to conduct a County-wide disparity study, as a result of the County’s competitive request for proposal (RFP). The City Manager subsequently sent a letter to the County Executive to discuss a possible partnership with the County on this work effort. While the City did not receive a response to this inquiry, the City did
1 California Proposition 209:
https://ballotpedia.org/California_Proposition_209,_Affirmative_Action_Initiative_(1996)
HONORABLE MAYOR AND CITY COUNCIL
May 23, 2022
Subject: Agreement with MGT of America Consulting LLC for a Citywide Disparity Study
receive copies of the County’s RFP, which included the requisite public agency purchase language, also known as piggyback language, which allows the City to leverage the County procurement and enter into a contract directly with MGT.
The City’s Fiscal Year 2022-23 Proposed Budget was released in May 2022 and included an additional $400,000 in funding for this initiative, pending City Council’s approval and adoption in June 2022. An additional funding of $50,000 is anticipated to be provided by Silicon Valley Community Foundation, a non-governmental organization, to help offset the cost of this project, which will be brought forward for approval and appropriation as part of a future budget process once details are finalized2. The Departments of Finance and Public Works staff subsequently reached out to MGT to commence discussions for a separate City contract.
ANALYSIS
The City will be leveraging the County’s Request for Proposals for Consulting Services for Disparity Study (RFP # eRFP-PRC-FY22-0005), pursuant to San José Municipal Code Chapter
4.12.225B.3 Public agency purchases. The City’s Chief Purchasing Officer determined leveraging the County’s RFP is appropriate for the following reasons:
• The County’s RFP included language that named the City of San José either specifically or categorically as a third-party beneficiary of the competitive procurement process, pursuant to San José Municipal Code;
• A review of the County’s procurement process indicated that is substantially complied with the City’s procurement procedures, pursuant to San José Municipal Code; • The County’s scope mirrored the City’s desired scope of services; • The County’s procurement and contract included recent, up-to-date pricing, as the RFP was released in July 2021 with the contract executed in January 2022; and • The County’s total cost was in-line with costs incurred by other public agencies and the City’s expected budget.
Staff recommends award of contract to MGT to conduct a disparity study for the City. MGT’s proposal is favorable in the following key areas:
• Extensive experience conducting disparity studies for other public agencies over 30 years;
• Thorough project approach and project schedule;
• Offers synergies with the current MGT disparity study work with the County, particularly with regards to conducting vendor outreach and surveys, to minimize or avoid “survey fatigue” among the business community;
• Fair and reasonable pricing compared to costs incurred by other public agencies.
2 See page 791 of the 2022-2023 Proposed Operating Budget:
https://www.sanjoseca.gov/home/showpublisheddocument/85284/637879526584500000
HONORABLE MAYOR AND CITY COUNCIL
May 23, 2022
Subject: Agreement with MGT of America Consulting LLC for a Citywide Disparity Study
Additionally, the City holds several other consulting contracts with MGT for other types of consulting services; the City’s experience with MGT in those capacities have been positive.
The Finance Department will lead this project, in collaboration with the Department of Public Works and the City Manager’s Office. The project would include a review of all Finance-, Public Works-, and department-led procurements.
Summary of Proposed Agreement: The agreement with MGT will be in accordance with the City’s standard terms and conditions and include the following provisions:
• A detailed scope of work to ensure that the implemented solution complies with the City’s requirements;
• A preliminary project implementation plan that meets the City’s requirements for project completion;
• A compensation schedule that includes holdback for vendor payment until after final acceptance of all milestones and project deliverables;
• Fixed pricing for the initial one-year term of the agreement; • One one-year option to extend the agreement, if more time is necessary to complete the project.
CONCLUSION
Approval of this recommendation will produce a Citywide disparity study report to help the City help assess its efforts to encourage participation of disadvantaged business in the City procurement and contracting process and provide recommendations and refinements that the City may take to increase the participation of disadvantaged businesses.
EVALUATION AND FOLLOW-UP
This memorandum will not require any follow-up from staff.
CLIMATE SMART SAN JOSE
The recommendation in this memorandum has no effect on Climate Smart San José energy, water, or mobility goals.
PUBLIC OUTREACH
This item will be posted on the City’s website for the June 14, 2022 City Council meeting.
HONORABLE MAYOR AND CITY COUNCIL
May 23, 2022
Subject: Agreement with MGT of America Consulting LLC for a Citywide Disparity Study
COORDINATION
This memorandum has been coordinated with the Department of Public Works, the City Attorney’s Office, and the City Manager’s Budget Office.
COMMISSION RECOMMENDATION
No commission recommendation or input is associated with this action.
FISCAL/POLICY ALIGNMENT
This action is consistent with the City’s 2022-2023 Proposed Operating Budget strategy to consider equity and inclusion in the City’s programs and service delivery.
COST SUMMARY/IMPLICATIONS
1. AMOUNT OF RECOMMENDATION (one-year initial term) $410,470
2. COST ELEMENTS:
One-Time Implementation Services (Year 1)
- Project Initiation $7,520
- Legal Review 2,560
- Procurement and Program Policy Review 14,200
- Data Assessment, Collection, and Preparation 48,920
- Relevant Geographic Market and Product Market Area 18,220 - Utilization Analysis 11,620
- Availability Analysis 115,520
- Public Sector Disparity Analysis 7,740
- Private Market Disparity and Non-Goal Analysis 9,700
- Regression Analysis 7,100
- Anecdotal Data Collection and Analysis 131,410
- Recommendations 9,980
- Goal Setting 9,640
- Develop Draft and Final Report 16,340
CONTRACT NOT-TO-EXCEED TOTAL (one-year initial term) $410,470 Contingency (subject to an executed change order or amendment) 89,530 GRAND TOTAL NOT TO EXCEED $500,000
3. SOURCE OF FUNDING: City-wide General Fund (001) appropriation ($450,000), and $50,000 from a non-governmental organization, Silicon Valley Community Foundation.
4. FISCAL IMPACT: The City of San José disparity study will be funded from a City-wide General Fund (001) appropriation. An additional funding of $50,000 is anticipated to be provided by a non-
HONORABLE MAYOR AND CITY COUNCIL
May 23, 2022
Subject: Agreement with MGT of America Consulting LLC for a Citywide Disparity Study
governmental organization, Silicon Valley Community Foundation, to help offset the cost of this project, which will be brought forward for approval and appropriation as part of a future budget process once details are finalized.
BUDGET REFERENCE
The table below identifies the funds and appropriations proposed to fund the contract recommended as part of this memorandum.
Fund # Appn. # Appn. Name Total Appn.
Amt. for
Contract*
2021-2022
Adopted Operating
Budget Page
Last Budget
Action (Date,
Ord. No.)
001 216L City of San José
Disparity Study
$50,000 $50,000 1081 06/22/2021
30621
Fund # Appn. # Appn. Name Total Appn.
Amt. for
Contract*
2022-2023
Proposed Operating
Budget Page*
Last Budget
Action (Date,
Ord. No.)*
001 216L City of San José
Disparity Study
$400,000 $400,000 803 N/A
* The 2020-2021 Proposed Operating Budget was released on May 4, 2022 is scheduled to be reviewed on June 14, 2022 and adopted on June 21, 2022 by the City Council.
CEQA
Not a Project, Public Project No. PP17-002. Consultant services for design, study, inspection, or other professional services with no commitment to future action.
/s/
JULIA H. COOPER
Director of Finance
For questions, please contact Jennifer Cheng, Deputy Director of Finance, at [email protected].