(5)AR 040108 Accounting Services contract

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ITEM #6 CITY OF COLTON AGENDA REPORT FOR CITY COUNCIL MEETING OF APRIL 1, 2008 TO: HONORABLE MAYOR AND MEMBERS IF THE CITY COUNCIL FROM: DILU DE ALWIS, FINANCE DIRECTOR SUBJECT: APPROVE PROFESSIONAL SERVICES CONTRACT WITH THERESA JALLORINA OF MAYON LLC FOR ACCOUNTING SERVICES DATE: MARCH 24, 2008 BACKGROUND The Finance Department has two Senior Accountant positions budgeted at the present time to provide a wide variety of accounting services. These tasks require technical skills in order to meet the accounting standards set by the Government Accounting Standards Board (GASB) and Financial Accounting Standards Board (FASB). DISCUSSION/ ANALYSIS In January 2007 due to the sudden passing of a Sr. Accountant a position has been vacant and has been filled through contract with an audit firm. Additionally in August 2007, the second Sr. Accountant left the City of Colton for employment with another agency in Northern California. This position was briefly filled through recruitment but became vacant again when the candidate did not pass probation. Recruitment is currently underway to fill this position. It has been staffs experience the past months that candidates with government accounting experience is very limited and the pool of candidates from which to select is depleted. Theresa Jallorina has been working with the Finance Department through a contract with an audit firm during the past few months as a Sr. Accountant. Staff is very pleased with the quality of her work product and has negotiated with the audit firm to contract directly with her subject to Council approval. Ms. Jallorina is familiar with the Eden Financial System, Utility Billing System and will be a great asset to the Finance Department. Her contract rate will be at $55 per hour which is a significant savings over the contract with the audit firm and per the proposed contract she will work approximately thirty hours per week. As a contractor she is not entitled to any benefits including medical, vacation, sick or holiday pay. The City will not make contributions to PERS on behalf of the contractor. Due to the depleted pool of qualified experienced candidates, staff feels this contract will enable the department to have quality senior accounting services at a lower cost than a full-time Sr. Accountant. A full-time Sr. Accountant with benefits at the current pay rate would top out at approximately $94,300 per year. The cost of services under this contract at the above mentioned rate would generate savings of approximately $15,000 per year. In addition, CMC Section 3.08.140 provides that the City Manager, for contracts up to $100,000, may dispense with public bidding for Professional Services Agreements when it is in the best interests of the City and its administrative operations. Theresa Jallorina is very familiar with the City's Financial Systems and has been working with the Department in the current fiscal year providing accounting services on an as -needed basis. Therefore, City staff respectfully requests that City Council ratify the City Manager's waiver of competitive bidding, and approve the Professional Services Agreement with Theresa Jallorina of Mayon LLC for $75,000 for accounting services. FINANCIAL IMPACT This contract if approved by the City Council will go into effect April 2nd will have a cost of $19,000 for fiscal year 2007-08 and a cost of $75,000 for fiscal year 2008-09. The funds for the fiscal year 2007-08 portion of the contract is available in account 100-6040-6041-2350 and the account's funding status is noted in the table below. The portion of the contract for fiscal year 2008-09 is not depicted in a table format as the budget for that year is a work in progress at this time. Budget FY 2007-08 Year-to-date Expenditures Open Available Encumbrances I Funds $ 219,000 $ 183,681 $ 5,000 1 $ 30,319